THE HIGH COURT IN THE MATTER OF THE COMPANIES ACTS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES ACT 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R eport of th e A p p o in t e d A f f a ir s o f to In specto rs E n q u ir e A n sb a c h e r in t o t h e (C a y m a n ) L im it e d Published by Order o f the Court made on 24 June 2002 V olum e [ i ]: R e p o r t BAILE ATHA CLIATH ARNA FHOILSIU AG OIFIG AN tSOLATHAIR Le ceannach direach on OIFIG DHIOLTA FOILSEACHAN RIALTAIS, TEACH SUN ALLIANCE, SRAID THEACH LAIGHEAN, BAILE ATHA CLIATH 2, no trfd an bpost o FOILSEA CHAlN RIALTAIS, AN RANNOG POST-TRACHTA, 51 FAICHE STIABHNA, BAILE ATHA CLIATH 2, (Teil: 01 - 6476834/35/36/37; Fax: 01 - 6476843) no trf aon dfoltoir leabhar. 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(Pn. 11798) €25.40 ISBN 0?7557?1355?9 Government of Ireland 2002 REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF AN SBACHER (CAYMAN) LIMITED CONTENTS Page Preface 5 Glossary 7 PART I: INTRODUCTION AND BACKGROUND 11 Chapter 1: Background to the appointment of Inspectors 12 PART II: ANSBACHER (CAYMAN) LIMITED - DESCRIPTION OF ITS IRISH BUSINESS AND THE WRONGDOING INVOLVED 23 Chapter 2: Evolution of the Irish business of Ansbacher (Cayman) Limited 24 Chapter 3: The services offered by Ansbacher (Cayman) Limited and the policy of concealment in operation 42 Chapter 4: The extent of the Irish business of Ansbacher (Cayman) Limited 65 Chapter 5: The wrongdoing of Ansbacher (Cayman) Limited 80 PART III: RESPONSIBILITY FOR TUI WRONGDOING OF ANSBACHER (CAYMAN) LIMITED 99 Chapter 6: Responsibility - Officers and Agents 100 Chapter 7: Responsibility of Mr Desmond Traynor 106 Chapter 8: Responsibility of Mr John Furze 120 Chapter 9: Responsibility of Mr John Collins 130 Chapter 10: Responsibility of Guinness and Mahon 139 Chapter 11: Responsibility of Guinness Mahon London 142 Chapter 12: Responsibility of Henry Ansbacher Holdings pic 149 Chapter 13: First National Bank of Southern Africa Limited 165 PART IV: ASSISTING ANSBACHER (CAYMAN) LTD 168 Introduction to Part IV 169 Chapter 14: Assistance provided by Guinness and Mahon 170 Chapter 15: Assistance provided by CRH pic 173 Chapter 16: Assistance provided by Bank of Ireland Private Banking Limited 190 Chapter 17: Assistance provided by Mr Padraig Collery 194 Chapter 18: Assistance provided by Ms Joan Williams 214 Chapter 19: Assistance provided by Mr Sam Field-Corbett 218 Chapter 20: Assistance provided by Mr Jack Stakelum 222 Chapter 21: Assistance provided by IIB 236 PART V: THE CLIENTS OF ANSBACHER (CAYMAMJ LIMITED 26fe Chapter 22: Identification and categorisation of the clients of Ansbacher (Cayman) Ltd 267 Chapter 23: List of clients of Ansbacher (Cayman) Ltd 279 PART VI: RELATED MATTERS 43% Introduction to Part VI 433 Chapter 24: Hamilton Ross Company Limited (1992 to early 1997) 434 Chapter 25: The role of the Central Bank 449 Chapter 26: Exchange Control 474 Chapter 27: The role of the auditors of Guinness and Mahon 477 Chapter 28: Persons who failed to co-operate with the Inquiry 482 PART VII: SUMMARY OF CONCLUSIONS 486 Chapter 29: Summary of Conclusions 487 List of Appendices I XV (12) XV (37) XV (62) XV (87) XV (112) XV (137) XV (162) II XV (13) XV (38) XV (63) XV (88) XV (113) XV (138) XV (163) III XV (14) XV (39) XV (64) XV (89) XV (114) XV (139) XV (164) IV XV (15) XV (40) XV (65) XV (90) XV (115) XV (140) XV (165) V XV (16) XV (41) XV (66) XV (91) XV (116) XV (141) XV (166) VI XV (17) XV (42) XV (67) XV (92) XV (117) XV (142) XV (167) VII XV (18) XV (43) XV (68) XV (93) XV (118) XV (143) XV (168) VIII XV (19) XV (44) XV (69) XV (94) XV (119) XV (144) XV (169) IX XV (20) XV (45) XV (70) XV (95) XV (120) XV (145) XV (170) X XV (21) XV (46) XV (71) XV (96) XV (121) XV (146) XV (171) XI XV (22) XV (47) XV (72) XV (97) XV (122) XV (147) XVI XII XV (23) XV (48) XV (73) XV (98) XV (123) XV (148) XVII XIII XV (24) XV (49) XV (74) XV (99) XV (124) XV (149) XIV XV (25) XV (50) XV (75) XV (100) XV (125) XV (150) XV (1) XV (26) XV (51) XV (76) XV (101) XV (126) XV (151) XV (2) XV (27) XV (52) XV (77) XV (102) XV (127) XV( 152) XV (3) XV (28) XV (53) XV (78) XV (103) XV (128) XV (153) XV (4) XV (29) XV (54) XV (79) XV (104) XV (129) XV (154) XV (5) XV (30) XV (55) XV (80) XV (105) XV (130) XV (155) XV (6) XV (31) XV (56) XV (81) XV (106) XV (131) XV (156) XV (7) XV (32) XV (57) XV (82) XV (107) XV (132) XV (157) XV (8) XV (33) XV (58) XV (83) XV (108) XV (133) XV (158) XV (9) XV (34) XV (59) XV (84) XV (109) XV (134) XV (159) XV (10) XV (35) XV (60) XV (85) XV (110) XV (135) XV (160) XV (11) XV (36) XV (61) XV (86) XV (111) XV (136) XV (161) Note: THIS PA G E DOES N O T FORM PA R T OF THE INSPECTORS’ REPO RT BUT, WITH THE CONSENT OF THE H IG H COURT, HAS BEEN INCLUDED IN THE COPY AUTHORISED TO BE PUBLISHED B Y ELECTRONIC MEANS TO FACILITATE NAVIG ATIO N WITHIN THE TEXT, Preface The Inspectors appointed by the High Court to examine the affairs o f Ansbacher (Cayman) Limited present herewith their Report In doing so, they wish to draw particular attention to a number o f matters. Firstly, they wish to stress that a finding by them that any particular person is a client of Ansbacher is not to be taken as a finding that that person has evaded tax. This matter is explained further in Chapter 22, and the Inspectors urge the readers o f this Report to pay particular attention to the explanation given in that chapter. Secondly, the Inspectors are conscious that during the greater part of the period in which the events related in this Report took place, the company under investigation did not bear the Ansbacher name. Therefore, when referring to the company, the Inspectors have attempted to refer to it by the name it was known by at any given period. So it is that the reader will find the company referred to on some occasions as ‘GMCT’ (Guinness Mahon Cayman Trust) the name by which it was known until its acquisition by the Henry Ansbacher Group of companies in 1988. On other occasions, it isreferred to simply as ‘Ansbacher’ a convenient shorthand for Ansbacher (Cayman) Limited, the company’s present title. Thirdly, readers of the Report will find a certain amount of repetition throughout This is deliberate, so that as many of the chapters as possible can be read as self-contained units, without the need for cross-reference to other sections of the Report. Finally, the Inspectors thank the staff who assisted them in their work, and without whom it would not have been possible to bring it to a completion. In particular, they wish to express their thanks to Frances Gaynor, Assistant Principal Officer who acted as Secretaiy to the Inspectorate, to Mary Cummins o f the Chief State Solicitor’s Office who acted as their Solicitor, to Tom Slevin and Padraig McGoldrick, Accountants, to Liam Bowen, Higher Executive Officer and to the following, who acted as members o f the Bowen, Higher Executive Officer and to the following, who acted as members o f the secretariat at different times: Susan Troy, Deborah Tyson, Anne Bevan, Breege O’Reilly, Declan Keegan, Maiy Farrell, Teresa Noonan, Tracey Me Govern. The Inspectors would like to record their thanks to their team o f advisors: Mr Jim O ’Hara, FCA, Mr Frank Clarke SC, Mr Shane Murphy SC, Mr Lyndon MacCann BL, Mr Fintan J O’Connor BL, Mr Antonio Bueno QC, Mr Charles Quin and Mr Hector Robinson o f Quin & Hampson, Barristers and Attorneys at Law in the Cayman Islands and Oslen Ferbrache Morgan, Advocates in Guernsey. The Honourable Mr Justice Declan Costello was one o f the original Inspectors appointed by the High Court Order o f 22 September 1999. He retired on the grounds o f iHhealth towards the end o f the year 2000. His retirement was an immense loss to the work of the Inspectors. They thank him for having done so much to shape their procedures and recognise his very significant contribution to the investigation. June 2002 His Honour Judge Sean O ’Leary Mr Paul Rowan F.C.A. Mr Michael Cush S.C. GLOSSARY OF TERMS Amiens ‘Amiens’ means either Amiens Investments Limited or Amiens Securities Limited which were companies set up by Mr Traynor to facilitate, in Ireland, lodgments to and disbursements from the Ansbacher memorandum accounts. Ansbacher ‘Ansbacher’ means Ansbacher (Cayman) Limited, formerly known as Guinness Mahon Cayman Trust Limited, Ansbacher Limited and Cayman International Bank and Trust Company Limited. Client For the puxposes o f their investigation and having regard to the contentsof the Order of the High Court dated the 22 September 1999, the Inspectors consider a person to be a ‘client’ of the Ansbacher (Cayman) Limited (‘the Company’) within the meaning o f the Order if business was carried out for that person by the Company in the State or, in the case o f a person who is an Irish resident, if business was carried out for him by the Company anywhere in the world. In particular, but without prejudice to the generality of the foregoing, a client shall include: a) Any person who directly or indirectly maintains or has maintained all or part of any account with tiie Company or who has or had de fecto or de jure control over all or part o f any account with the company. b) Any person who has or had de jure or de facto control o f a body corporate which directly or indirectly maintains or has maintained an account with the Company or is or was administered by the Company or which has had borrowings directly or indirectly secured wholly or partly by the Company. c) The Settlor o f any trust administered by the Company or of which the Company is or was the trustee and/or any other person or persons who funded such a trust or caused such a trust to be funded. d) The Beneficiary o f any trust administered by the Company or of which the Company is or was the trustee in circumstances where the beneficiary has or had de jure or de fecto control ova- all or part o f the trust funds. e) Any person who had an account relationship with a body corporate owned or managed by the Company. The expression ‘account’ shall include deposit accounts, loan accounts, securities accounts and custodial accounts. College Trustees ‘College Trustees’ means College Trustees Limited, a Guernsey incorporated limited liability trust company which was formed in 1975 as a wholly-owned subsidiary o f Guinness Mahon Channel Islands Limited, which in turn was a wholly-owned subsidiary o f Guinness and Mahon. The Company ‘The Company’ means Ansbacher (Cayman) Limited, formerly known as Guinness Mahon Cayman Trust Limited, Ansbacher Limited and Cayman International Bank and Trust Company Limited. Considered adequate ‘Considered adequate’ see ‘suitably secured’ CRH ‘CRH’ means CRH pic formerly known as Cement Roadstone Holdings pic. GMCT ‘GMCT’ means Guinness Mahon Cayman Trust Limited, a former name o f ‘Ansbacher’. GMCI ‘GMCI’ means Guinness Mahon Channel Islands Limited a company which was formed in Jersey in 1974 to provide banking services, which was a wholly owned subsidiary o f Guinness and Mahon. Guinness and Mahon ‘Guinness and Mahon’ means Guinness and Mahon (Ireland) Ltd, formerly known as Guinness and Mahon Limited. Guinness Mahon London ‘Guinness Mahon London’ means Guinness Mahon & Company Ltd, London. Hamilton Ross ‘Hamilton Ross’ means Hamilton Ross Company Limited, a company incorporated in the Cayman in whose name accounts were opened in IIB from 1992 onwards. Some o f the funds held in accounts in Ansbacher’s name in EB were transferred to the Hamilton Ross accounts. Ansbacher accounts in Guinness and Mahon were re-named Hamilton Ross during the year 1992/93. Almost all Hamilton Ross accounts were formerly Ansbacher accounts. IIB ‘IIB’ means IIB Bank Limited formerly known as Irish Intercontinental Bank Limited. The McCracken Tribunal ‘The McCracken Tribunal’means the Tribunal of Inquiry (Dunnes Payments) The Moriarty Tribunal ‘The Moriarty Tribunal’ means the Tribunal of Inquiry (Payments to Messrs Charles Haughey and Michael Lowry). Off-shore deposit ‘Off-shore deposit’ means a deposit of funds by a person in a financial institution outside the State in which he/she is residing. Overseas Nominees Limited ‘Overseas Nominees Limited’ means the Cayman Island incorporated company providing nominee services to its parent company Guinness Mahon Cayman Trust Limited. Person ‘Person’ includes a corporate entity. Poinciana Fund Limited ‘Poinciana Fund Limited’ means a company incorporated in the Cayman Islands, in whose name an account was opened in Bank of Ireland, into which deposits of a number o f individuals were lodged. Poinciana Fund Limited was at all relevant times a company vehicle used for conducting Ansbacher business. Sovereign Management ‘Sovereign Management’ means Sovereign Management Limited, a company incorporated in Guernsey in 1974 which provided company and trust management services to College Trustees Limited. Suitably secured/adequately secured or considered adequate ‘Suitably secured’ or ‘adequately secured’ or ‘considered adequate’: this terminology was used by the officers and officials o f Guinness and Mahon to describe loans that were secured (but not necessarily solely secured) by funds on deposit with a subsidiary of Guinness& Mahon outside the jurisdiction. PART I INTRODUCTION AND BACKGROUND CHAPTER 1 BACKGROUND TO THE APPOINTMENT OF THE INSPECTORS INDEX 1.1 The Cayman Islands and the ‘Dublin accounts ’ 13 1.2 Ansbacher (Cayman) Limited 14 1.3 The Report o f the McCracken Tribunal 15 1.4 The Moriarty Tribunal 15 1.5 The Report o f the Authorised Officer 15 1.6 The Order Appointing the Inspectors and the structure o f this Report 16 1.7 The identification of possible breaches of Common Law and Statutory Provisions, including Company Law. 17 1.8 The Work of the Inspectors 19 1.9 Those Assisting Ihe Inspectors 21 CHAPTER 1 BACKGROUND TO THE APPOINTMENT OF THE INSPECTORS 1.1 The Cayman Islands and the ‘Dublin accounts’ ‘There is a book o f customer accounts ( ‘Dublin accounts’) which are operated and controlled in Dublin, Ireland by the Chairman o f Ansbacher Limited. The Dublin accounts are operated outside the regular internal control environment o f Ansbacher Limited...’ So commences a 1992 management letter from the auditors to Ansbacher (Cayman) Limited. The auditors were describing what have since become known (somewhat incorrectly) to the people of Ireland as the ‘Ansbacher accounts’. It is important to bear in mind that the Company under investigation did not become the responsibility of the Ansbacher group of companies until 1988. Up to that time, it belonged to the Guinness Mahon group (except for a period o f a few months when it belonged to a consortium led by Mr Desmond Traynor) and was known as Guinness Mahon Cayman Trust, or GMCT. 1 The accounts might therefore more correctly be called the ‘GMCT accounts’. This Report attempts to tell the story o f these accounts, which involves the island o f Ireland and the island of Grand Cayman, largest o f the Cayman Islands. The Cayman Islands are situated off the coast of Florida in the Caribbean, 475 miles south o f Miami and 200 miles west o f Montego Bay, Jamaica The Islands are a British crown colony. However, for all practical purposes they are governed under a constitution that gives executive and legislative power to a Governor, an Executive Council and a Legislative Assembly. They therefore enjoy a large measure of self-government. Of the 1 The Cayman bank, which was originally called Guinness Mahon Cayman Trust (and later, GMCT), did not change its name to ‘Ansbacher Limited’ until 1988. Itbecame Ansbacher (Cayman) Limited only in 1994 three islands that make up the group, Grand Cayman is the largest and busiest, with a flourishing banking industry. In Georgetown, the principal town o f Grand Cayman, stands Ansbacher House, the registered office of Ansbacher (Cayman) Limited. 1.2 Ansbacher (Cayman) Limited Ansbacher (Cayman) Limited (which in this Report will be referred to simply as ‘Ansbacher’ or as ‘GMCT’, depending upon the period referred to) has had a number of names in the course o f its fairly short history. It was incorporated in the Cayman Islands in 1971 as Guinness Mahon Cayman Trust Ltd, and was a subsidiary o f the Dublin merchant bank, Guinness and Mahon Limited. The Cayman Islands were at that time part o f the sterling area introduced into the United Kingdom in 1939. However, in 1972, the sterling area was effectively dismantled. The ‘scheduled territories’, that is, those territories not subject to Exchange Control legislation, were reduced to just the Channel Islands, the Isle o f Man, Ireland and Gibraltar. The Cayman Islands no longer formed part o f the scheduled territories from that time. In 1973, GMCT had obtained a full class ‘A ’ banking licence, which allowed it to provide general banking services. In 1988, having been sold to Chichester Investments Ltd, the name o f the Cayman Company was changed to GMCT Ltd. Later in the same year, the name Ansbacher was used for the first time, after the Company was called Ansbacher Ltd by new owners. In November 1992, the name changed again to Cayman International Bank and Trust Company Ltd. It was in September 1994 that the Company assumed its current name o f Ansbacher (Cayman) Ltd. 1.3 The Report of the McCracken Tribunal The events giving rise to the appointment o f High Court Inspectors into the affairs of Ansbacher commenced in August 1997 with the publication o f the report o f the Tribunal of Inquiry (Dunnes Payments), more popularly known as the McCracken Tribunal. That report revealed for the first time the existence of what came to be known as the ‘Ansbacher deposits’ - monies lodged by Irish residents with Ansbacher and placed on deposit by that company with Guinness and Mahon. 1.4 The Moriarty Tribunal Following publication o f the Report of the McCracken Tribunal, the Government established a new Tribunal to investigate payments to politicians. This was entitled ‘Tribunal o f Inquiry (Payments to Messrs Charles Haughey and Michael Lowry), but is popularly referred to as the Moriarty Tribunal. Both prior and subsequent to its establishment, unsuccessful attempts were made in the Dail to broaden the terms of reference o f this Tribunal so as to allow it to investigate aspects of the Ansbacher accounts other than possible payments to politicians from them. 1.5 The Report of the Authorised Officer Section 19 o f Part 11 of the Companies Act, 1990, (‘the Act’) provides that the Minister for Enterprise, Trade and Employment (‘the Minister’),2 may seek the production o f books and documents o f companies under investigation, and may authorise an officer to do so on her behalf. On 8 January 1998, the Minister, by warrant of appointment o f that date, authorised Mr Gerard Ryan to seek the production of Ansbacher’s books and documents. Mr Ryan reported to the Minister on 22 June 1999. As a direct result of his report, the Minister decided to ask the High Court to appoint Inspectors pursuant to the provisions of Section 8 o f the A ct Accordingly, on 22 September, 1999, the High Court appointed the Honourable Mr Justice Declan Costello, Ms Noreen Mackey, barrister-at- Since the enactment of the Companies Act 2001, the Minister’s role in regard to the investigation of companies has been taken over by the Director of Corporate Enforcement law and Mr Paul Rowan, FCA as Inspectors to investigate the affairs o f Ansbacher. Following the retirement from the Inquiry on health grounds of Mr Justice Costello in November 2000, the High Court, by Order dated 8 December 2000 appointed His Honour Judge Sean O’Leary and Mr Michael Cush, Senior Counsel, to replace him. Copies o f the two Orders are attached at Appendix 1(a) and Appendix 1(b). 1.6 The Order appointing the Inspectors and the structure of this Report The original Order o f the 22 September 1999 constitutes the terms o f reference for this investigation. The operative part o f the Order reads: ‘it is ordered that the said Inspectors investigate and report to the Court on the affairs o f the Company in the title hereof and in particular: (a) to examine and define the nature and extent of the Company’s Irish business from 1971 to date i. e. the business carried out in the State or any other business carried out on behalf of Irish residents whether in the State or elsewhere (b) to identify as far as possible all of the parties who were either officers (including shadow directors) and agents of the Company clients o f the Company or who otherwise assisted in the carrying out of the business at the relevant time (c) to examine whether the Companies Acts, 1963-1990 were breached by the Company, its officers (including shadow directors), agents or third parties at the relevant time and if so to identify the provisions involved and the persons in default in each case d) to examine whether the affairs of the company were conducted with an intent to defraud its creditors or the creditors o f any other person or otherwise for a fraudulent or unlawful purpose and if so to identify the statutory provisions involved and the persons in default in each case (e) to report on any related matters. ’ This Report is structured in such a way as to reflect the terms o f reference set for the Inspectors by the High Court. Thus, Part II of the Report contains chapters dealing with the evolution o f the Irish business of Ansbacher (Cayman) Limited, dealing with the services offered by the Company and the nature and extent o f its business and dealing with the wrongdoing committed by the Company. Part El of the Report seeks to identify those persons and companies responsible for the wrongdoing o f Ansbacher. Part IV o f the Report identifies those who assisted Ansbacher in the carrying out of its unlawful business in Ireland. Part V identifies the clients of the Company. The Inspectors are mandated by the Order appointing them to identify the clients of the Company but they do not interpret the Order o f the 22 September 1999 as permitting them to investigate the clients of the Company. This interpretation has been confirmed by the High Court By an Order made on the 13 March 2001, Mr Justice Johnson directed that, in discharging their obligation to the High Court, the Inspectors were required to investigate and report on the clients o f Ansbacher only in so far as it was necessary to do so for the purpose of examining and defining the nature and extent of Ansbacher’s Irish business, for the purpose o f identifying the clients and for the purpose o f examining the affairs o f Ansbacher. Part VI of this Report contains chapters dealing with related matters, and, finally, Part VII contains a summary of the Inspectors’ findings. 1.7 The identification of possible breaches of Common Law and Statutory Provisions, including Company Law The Inspectors gave detailed consideration to the duties imposed upon them by the terms of the Order of 22 September 1999 in so far as these involved the identification o f breaches o f the Companies Acts and taxation provisions and o f possible fraud by Ansbacher and other entities or persons. The Inspectors further considered how (if at all) the obligation to report on related matters contained an implied obligation to report mutatis mutandi on any potential fraud discovered in these additional areas o f reporting. The Inspectors are satisfied that the terms o f the Order o f 22 September 1999 imposes an obligation on them to identify both the fact o f and possible responsibility for any possible breaches of the Companies Acts and other statutory and common law offences. The Inspectors have however been conscious of the need to ensure that any person identified in pursuance o f that duty is not categorised as an offender by reason o f this investigation but is accorded the presumption o f innocence to which every person is entitled. The extent of the conclusions o f the Inspectors, in respect o f those potential offences identified and persons named in connection with them, has been limited to a finding that in any particular case there is evidence tending to show that a particular offence has been committed or that there is evidence tending to show that a specified person has committed that offence. Those reading or commenting on this Report should also be conscious o f the rights o f those named. It is a matter for others to decide whether, in the light of the available evidence and the standard o f proof required in a criminal case and other factors such as delay, any criminal prosecutions are desirable or possible. The Inspectors foresee some difficulty in bringing such prosecutions. The extent to which this duty to report on potentially criminal acts extended to those issues which the Inspectors decided were related matters within the meaning o f the Order was also considered. The Inspectors have construed their duty to report on related matters narrowly, confining their consideration of possible offences arising from such matters to business activities that were continuations o f Ansbacher activities (such as Hamilton Ross) or businesses feeding Ansbacher’s Irish business (such as the deposit taking activities o f Mr Jack Stakelum). The relationship between the activities o f the Company and these matters was so close that the Inspectors formed the view that it was necessary to include comments on potential breaches of the criminal law covering these areas. 1.8 The Work of the Inspectors Stages of the Investigation The work o f the Inspectors was carried out between September 1999 and June 2002 at a total cost o f approximately €3,2m. There have been a number of identifiable stages to the Investigation. There was first the information gathering phase. This was a lengthy process involving the assessment of thousands of documents and the taking of evidence o f approximately two hundred witnesses. The second stage involved the assessment o f information gathered and in particular the consideration o f whether or not that information warranted preliminary findings of an adverse nature against any individual or corporation. The third stage involved the communication of any such preliminary findings and the identification o f the evidence upon which the findings were based. Each person in receipt of such a preliminary finding was informed that he or she was entitled to challenge the preliminary finding either by challenging the evidence upon which it was based, producing evidence to the contrary, making oral or written submissions or any combination thereof. The next stage o f the process involved hearings in which the preliminary findings o f the Inspectors were challenged by the persons concerned. Lastly, the Inspectors considered all of the relevant evidence and in particular the evidence and submissions of those who had challenged their preliminary findings. The Inspectors then proceeded to finalise their conclusions. This Report was then written. Work in the Cayman Islands and the Channel Islands On 7 June 2000, the Inspectors made application to the High Court in Dublin for an Order directing that the Court issue a letter of request to the Grand Court of the Cayman Islands, seeking its assistance for the purposes of the investigation and, in particular, requesting that it make Orders directing that certain officers of Ansbacher (Cayman) Limited attend for examination before the Inspectors and that the Company produce certain documents to the Inspectors. The High Court in Ireland duly issued such a letter o f request. The matter first came before the Grand Court o f Cayman on foot o f a summons dated 20 September 2000. It was then agreed that the letter o f request application be postponed to await the outcome o f an application brought by the Company itself pursuant to Section 4 o f the Confidential Relationships (Preservation) Law [1995 revision], seeking leave o f the Grand Court of Cayman to divulge to the Inspectors certain confidential information relating in particular to the identification o f clients of the Company. That application was heard before Mr Justice Smellie over a period o f seven days in the months o f April and May 2001. Ultimately, in a reserved judgement, Mr Justice Smellie directed that the Company be at liberty to furnish to the Inspectors a limited amount of information. Significantly, he directed that they were not at liberty to furnish the Inspectors with information which would identify the clients of the Company. In the light of this ruling, the Inspectors were advised that there was little point in proceeding with the letter o f request application. Furthermore, although the Inspectors were advised that there were some grounds for appealing the Order made by Mr Justice Smellie, they were also advised that the outcome of any appeal was far from certain and that ultimately the appeal process might take a period of years. The Inspectors decided not to appeal. On 27 July 2000, an application was made by the Inspectors to the High Court in Dublin for an Order directing that the Court issue a letter o f request to the Royal Court o f Guernsey in the Channel Islands, seeking its assistance for the purposes of the investigation and, in particular, requesting that it make Orders directing that certain officers o f College Trustees and its parent company furnish evidence and specified documentation to the Inspectors. The High Court subsequently signed this letter o f request. However, in light o f the decision o f the Grand Court o f Cayman, referred to above, the Inspectors received advice that the application would not succeed. Therefore, the Inspectors applied to have the letter of request withdrawn. The High Court withdrew the letter of request on 7 June 2002. The Authorised Officer’s Report Whilst the report o f the Authorised Officer, Mr Gerard Ryan, was the basis o f the appointment o f the Inspectors, it is not the basis for and does not form any part o f this Report From the outset, the Inspectors determined that they would report to the Court only on the basis o f their own work and not upon the basis of the work o f others. It is worth noting also that the powers available to Mr Ryan as an Authorised Officerpursuant to the Companies Act, 1990 were confined essentially to seeking books and documents and requiring explanations o f same. The powers of the Inspectors are considerably more extensive. They include, in particular, the power to compel any person who may be in possession of information concerning the affairs of the company to attend before them and to give all assistance in connection with the investigation that he or she is reasonably able to give. This power, which was not available to Mr Ryan, was exercised frequently by the Inspectors and resulted in the Inspectors having a level o f interaction with a wide variety o f individuals from which their understanding of the affairs o f the Company was greatly enhanced. To the extent that there may be differences in the report of the Authorised Officer and the report of the Inspectors, those differences are almost certainly explained by the greater powers available to the Inspectors. Conflicts of Interest During the course o f the Inquiry, each Inspector examined the matters involved and identified any potential conflicts of interest that arose. They disqualified themselves from all decision-making in relation to those cases. In identifying these potential conflicts, the Inspectors erred on the side o f caution. Those parties in respect of whom conflicts o f interest were declared were individually notified o f the matter. These procedures were adopted in accordance with the terms o f Court Orders dated 6 April 2000 and 25 May 2001 (see Appendix 1(c) and Appaidix 1(d)). 1.9 Those assisting the Inspectors The Inspectors place on record the co-operation that they received from many individuals and companies. In particular: The manner in which Guinness and Mahon Ireland Ltd, under its new owners, dealt with the Inspectors was very co-operative. First Rand Limited and the First National Bank o f Southern Africa Limited being the later owners o f Ansbacher (Cayman) Ltd co-operated very fully with the Inspectors. Henry Ansbacher Holdings pic also participated in the supply o f information which played a significant part in advancing the understanding of the Inspectors of the issues involved. Ansbacher (Cayman) Ltd co-operated to the extent permitted by the Grand Cayman Court. The Inspectors record the very willing and substantial help received from the executives o f IIB pic and CRH pic. Mr Padraig Colleiy assisted the Inspectors with promptness and courtesy in difficult circumstances. Mr Jack Stakelum (having quite properly raised his concerns in respect of giving evidence concerning his former clients) when required by the Inspectors fully discharged his duties. Many others also assisted the Inspectors in their work. These include persons who, though appearing to be the subject o f proper inquiry by the Inspectors, on the receipt o f their evidence were found not to have any connection with the subject of this investigation. Chapter 29 contains the very limited list of those whose co-operation fell short of what is required under the Companies Acts. PART II ANSBACHER (CAYMAN) LIMITED DESCRIPTION OF ITS IRISH BUSINESS AND THE WRONGDOING INVOLVED CHAPTER 2 EVOLUTION OF THE IRISH BUSINESS OF ANSBACHER (CAYMAN) LTD INDEX Page 2.1 Guinness and Mahon and the Cayman connection 26 2.2 The modernisation of Guinness and Mahon 27 2.3 Mr James Desmond Traynor 28 2.4 The genesis of GMCT 29 2.5 Early operation of GMCT 31 2.6 Opening of accounts with Guinness and Mahon 31 2.7 Amiens Investments Limited and Amiens Securities Limited 32 2.8 Mr Traynor on the board of GMCT 33 2.9 College Trustees Limited 34 2.10 Mr Richard Fenhalls and the sale of GMCT to GMOIL 34 2.11 Mr Traynor leaves Guinness and Mahon 35 2.12 Mr Traynor opens accounts with NCB 35 2.13 Sale of GMCT to Chichester Investments Limited 36 2.14 Sale of GMCT to the Henry Ansbacher Group 37 2.15 Change of name of GMCT and Mr Traynor appointed as Chairman 37 2.16 IIB and Kentford Securities Limited 37 2.17 Hamilton Ross 39 2.18 Sale of Henry Ansbacher Group to First National Bank of 2.19 Southern Africa, and further change of name of the Cayman Company 40 Sale of First National Bank of Southern Africa to FirstRand Limited 41 CHAPTER 2 EVOLUTION OF THE IRISH BUSINESS OF ANSBACHER (CAYMAN) LIMITED 2.1 Guinness and Mahon and the Cayman connection The story of the Irish business of Ansbacher is so inextricably linked to the company’s genesis that it is necessary, in order to fully understand it, to begin at the time of its incorporation. This occurred when Guinness and Mahon had decided to extend their services to include an offshore operation in a tax haven. At that time, Guinness and Mahon was a small merchant bank in College Green, Dublin. Originally established in 1836 by John Ross Mahon and Robert Guinness as a merchant bank, it subsequently opened a sub-office in London, which in 1923 became the headquarters of the bank. It became an incorporated company on 3 February 1942 under the name Guinness and Mahon Limited, (see Appendix 11(a)). In 1966, it became Guinness and Mahon (Ireland) Limited and became a wholly owned subsidiary of Guinness Mahon & Company, the London bank. In 1994, it was acquired by the then Irish Permanent Building Society, now known as Irish Life & Permanent pic. Guinness and Mahon was effectively run by its three managing directors, Mr John Guinness, Sir George Mahon and Mr William Forwood. This triumvirate was known as a ‘conclave’. On 17 January 1969, they agreed at a conclave meeting to investigate the possibility of forming a company or trust in the Cayman Islands ‘or in some other haven The following month they instructed the late Mr Liam McGonagle, solicitor, to arrange for the incorporation of seven companies in the Caymans, of which four were to be taxexempt companies. Matters seem to have rested there until June 1969, when, in the minutes of a meeting of directors, under the heading of ‘B ank o f Nova Scotia Trust Co. (Cayman) Lim ited’, the following item is found: ‘J ohn Collins, Manager, has called to see G.E.J.M* [Sir George Mahon] and J.H.G [Mr John Guinness] in connection with companies set up fo r us. L. McGonagle who was present at the meeting is satisfied with the proposals whereby an operation can be ‘unscrambled’ without any action having to be taken in the Cayman Islands. I f we can devise an attractive scheme fo r our customers the Trust Company would probably be prepared to split some o f their fees with us. ’ This document is interesting on two counts; firstly, the ‘John Collins ’ referred to, who at the time was an official of the Bank of Nova Scotia, subsequently became one of the first directors of the new Cayman bank.1 Secondly, there is already an incentive for Guinness and Mahon to ‘devise an attractive scheme ’ for their customers. 2.2 The modernisation of Guinness and Mahon The minutes of the conclave meeting in December 1969 note that Mr Guinness had discussions with ‘M r Desmond Traynor’ concerning the operation of Cayman Island companies. This is the first appearance of Mr Traynor on the Guinness and Mahon stage. He was already known to each of the three managing directors, who had formed a high view of his capabilities. Around that time, Mr Guinness, Sir George Mahon and Mr Forwood had begun to take stock of the merchant bank they governed, and had come to the conclusion that it needed to change its rather leisurely, old-fashioned style to something more in keeping with the competitive world of mid-twentieth century banking. As Mr Forwood has told the Inspectors, the three men were conscious that they came from a similar Anglo-Irish Protestant privileged background. All three had received a similar upbringing, and indeed, had even attended the same school. They were aware that the bank needed new blood; someone from outside the Old Boys’ club that Guinness and Mahon had become, someone, as Mr Forwood put it, who was in touch with the ‘outside world’. To this end, each one drafted a set of specifications, and when they came together Mr Collins and Mr Forwood are the only surviving members of what may be called the founding group, and are thus the only people from whom the Inspectors have been able to obtain first-hand evidence. Much of this portion of the Report is derived from the evidence of Mr Forwood. to discuss them, they agreed that there was only one man for the job - Desmond Traynor. Shortly afterwards, therefore, at the end of 1969, Mr Traynor, who up to that time was a partner in the accountancy firm of Haughey Boland, was appointed to the board of directors of Guinness and Mahon. 2.3 Mr James Desmond Traynor Mr James Desmond Traynor commenced his career in 1950 as the first articled clerk in Haughey Boland & Company, Chartered Accountants, where he remained until 1969. During that period, Mr Charles Haughey was also working with the company and there Mr Traynor struck up what was to be a lifelong friendship with the future Taoiseach. Mr Traynor appears to have been a man of formidable capabilities, who went on to become one of the outstanding financiers of the 1980s and early 1990s. He was reserved to the point of taciturnity; a man who could truly be said not to have permitted his left hand to know what his right hand was doing. At the same time, he was, according to his secretary, a man devoted to his family, who, no matter how pressing his business engagements, would never miss the family holiday. He was also a man who inspired absolute trust and confidence in all who met him; indeed, a recurring theme in the evidence gathered by the Inspectors has been the phrase ‘/ trusted M r Traynor absolutely Mr Traynor would remain on the board of directors of Guinness and Mahon until 1986. He would hold the position of Chairman of CRH pic from 1987 until his death in 1994 and became without doubt one of the leading figures in the Irish business community. When, in 1990, the Corporate Finance Department of Henry Ansbacher & Company in London had instructions to convert the Irish Permanent Building Society from a mutual society into a bank, Mr Richard Fenhalls, Henry Ansbacher’s then Chief Executive, identified Mr Traynor as a possible candidate for the position of Chief Executive of the new bank. 2.4 The genesis of GMCT It was, then, this man who, according to Guinness and Mahon conclave minutes, in the year following his arrival in Guinness and Mahon visited Nassau in the Bahamas ‘concerning Trust companies’. On 12 March 1970, a brief note in the minutes refers to the Cayman companies that had by then been incorporated and allocated to individual customers of Guinness and Mahon. It was noted that the customers concerned were to bear the expenses of those companies. During the same meeting, Mr Traynor reported that following his recent visit to the Bahamas, he and Mr William Forwood had attended a meeting in Guinness Mahon & Company London, at which it was agreed in principle to form a Guinness Mahon Bahamas Trust Company, but that more detailed information would be sought before a final decision was taken. Finally, another small item appears in the minutes of that meeting: ‘J ohn Collins o f Bank o f Nova Scotia Trust Co. has asked i f we would be interested in financing a residential development in the North Sound at Grand Cayman. We are applying fo r more information before suggesting that the Principal, John Dise, should come to meet us. ’ The information was forthcoming, and by May, the directors were considering ‘copious cash flow statements' sent by John Dise. By 25 June 1970, Mr Traynor was taking an active role in the matter. At a Guinness and Mahon directors’ meeting held on that date, he reported that it had been decided in London to proceed with the incorporation of Guinness Mahon Bahamas Trust Limited. For the first time, the possibility of setting up a bank in Cayman is referred to in the minutes. However, it must already have been the subject of unrecorded discussion, because Mr Traynor reports that if it is decided to proceed with such a bank, the name to be used would be Guinness Mahon Cayman Trust Limited, and that it would then also be decided to have the share capital of both the Bahamas and the Cayman Trust companies owned by a new holding company in Cayman, which in turn would be wholly owned by Guinness and Mahon. The minutes record that the decision whether or not to proceed with the creation of a Cayman bank would be made upon consideration of Mr Traynor’s final recommendation. By 16 July 1970, the idea of a bank seemed to have been temporarily shelved. Instead, Mr Traynor proposed the incorporation of Guinness Mahon Cayman Trust Limited as a holding company for Guinness and Mahon’s various Cayman investments On 19 November 1970, Mr Traynor reported that he had been to Cayman and was satisfied with the bank’s various investments there. He was happy that the ‘political situation ’ in Cayman had not changed, and could "still be said to be very satisfactory ’. In contrast, the political situation in the Bahamas, which he had also visited, was not looking good, and he did not believe that much business would materialise in respect of Guinness and Mahon’s trust company there. He said that he hoped to return to Cayman early in 1971 to establish Guinness Mahon Cayman Trust Limited. Finally, on 25 January 1971, Guinness Mahon Cayman Trust Limited (‘GMCT’), the company that is now known as Ansbacher (Cayman) Limited, was incorporated to provide trust and other corporate services to wealthy customers of the Guinness Mahon Group. Guinness and Mahon subscribed in full for the issued share capital of Jamaican $20,000. Minutes of 28 January 1971 note that the application for a banking licence had been approved in principle by the Executive Council of the Cayman Islands. By 5 March 1971, a restricted banking licence had been obtained and in 1973 the company obtained a full Class ‘A ’ licence, enabling it to provide banking services both within and outside of the Cayman Islands. Between 1971 and 1973, the administration of the new bank was carried out by the Bank of Nova Scotia Trust Company (Cayman) Limited. Two employees of the Bank of Nova Scotia, Mr John Collins and Mr John Furze, were nominated by their employer to act as directors of GMCT. In 1973, GMCT set up its own offices and staff in Cayman, and terminated its contract with the Bank of Nova Scotia. At that point, Messrs Collins and Furze left their previous employment to become executive directors of the new company. 2.5 Early operation of GMCT The first set of accounts of GMCT is dated 31 March 1971. It shows that the Company had at that date two wholly owned subsidiaries, Ireland’s Eye Limited and Blasket Limited. Both, despite their names, were Cayman companies. These subsidiaries in turn owned two other companies: Mercury Holdings Limited and Mercury Investments Limited. The subsidiaries appear to have been involved in the buying and selling of land. Up to that date, GMCT does not appear to have begun to offer the services to Irish clients for which it has since become so well known. However, a significant item appears in the minutes of a meeting of directors of Guinness and Mahon on 21 April 1971, when Mr Traynor reports that John Collins would be visiting Ireland in May, and that a meeting would be set up with the firm of Kennedy Crowley (now KPMG) ‘who are interested in services which we can offer in Cayman ’. On 6 May, the proposed meeting was again referred to, this time "with a view to arranging that business shall flow through our trustee company. ’ This is the genesis of a mutually profitable liaison between Kennedy Crowley and Guinness and Mahon. Kennedy Crowley had at that time wealthy clients seeking a secure and perhaps confidential investment for their funds, while Guinness and Mahon had an offshore trust company waiting for customers. By June 1971, the meetings had taken place, but with John Furze rather than John Collins representing GMCT. Around that time too, back-to-back arrangements involving Cayman are mentioned for the first time in the minutes, where it is said to have been agreed that any differential arising would normally be split equally between Guinness and Mahon and GMCT. 2.6 Opening of accounts with Guinness and Mahon On the date of its incorporation, GMCT opened various accounts with Guinness and Mahon, and signed a declaration of non-residency in respect of each of them. The effect of this declaration was that the interest earned on the accounts would not be included in any returns made by Guinness and Mahon to the Revenue. In a Guinness and Mahon list of thirty non-resident deposit accounts dated 30 June 1972, twenty-five are coded accounts in the name of GMCT. For convenience, these accounts and deposits will from here on be referred to as the GMCT accounts, or the GMCT deposits. In a list of loans over £5,000 of the same date, nine are expressed to be to ‘Guinness Mahon Cayman Trust’. However, the first extant statements of GMCT’s accounts in Guinness and Mahon date from 1974. From then on, a series of accounts appears. Some accounts are specific to a particular currency - sterling, US dollars, etc - while others are specific to a particular individual. The latter accounts, although in the name of GMCT, bear coded references, for example ‘re. H C ’ or LA (I Some of these accounts represented funds belonging to trusts established by Irish clients with GMCT. Other accounts represented simple deposits of funds made by Irish clients with GMCT. GMCT placed the funds, or part of them, on deposit with Guinness and Mahon, thus enabling the client to have easy access to them. Others again were sundry accounts. Some of these sundry accounts also contained money beneficially owned by individuals. The instructions on all of these accounts were given by telex from GMCT, or by internal communication from Mr Traynor. 2.7 Amiens Investments Limited and Amiens Securities Limited In 1976, Mr Traynor opened accounts in Guinness and Mahon in the names of Amiens Investments Limited and Amiens Securities Limited. These accounts allowed Irish residents to lodge Irish currency to their Cayman or Channel Island trusts or deposit accounts. The client would give the funds to Mr Traynor, who would lodge them to one of the Amiens accounts. The transaction would then be recorded on the client’s memorandum account - a secret coded account maintained by Mr Padraig Collery (see chapter 3) and would ultimately be reflected in the books of GMCT. Mr Traynor occasionally used the Amiens accounts to make cash payments to persons who wished to withdraw funds from their offshore accounts. The effect of these transactions was that the client could deposit or withdraw Irish pounds in Dublin without requiring Exchange Control clearance, and without bringing the transactions to the attention of the Revenue Commissioners (see Ninth Memorandum of Evidence of Sandra Kells to the Moriarty Tribunal at Appendix 11(b)). Mr Collery gave evidence to the Inspectors on 11 January 2000 that there were a number of Amiens type accounts: ‘A miens SX. was an account used by M r Traynor. There were a number o f these Amiens investments. Amiens Investments, Amiens Securities, Kentford, Montbrook, they are obviously nominees. They were all used fo r the facility o f receiving Irish funds and then paying these Irish funds back out again, in general. ’ Mr Collery, in evidence, described the process of lodging and withdrawing thus: A ... I f the client had £5,000 Irish and wished to put it into an account in Cayman, from time to time there were instances, we know where M r Traynor accepted that £5,000 Irish and lodged it, say, into Amiens Securities. So now Amiens Securities has the value o f a credit o f £5,000 in its books. L e t’s say that is M r X M r X already has an account in Cayman. M r ABC, to which we referred to [sic] earlier, comes in and says, 7 want to draw o ff £5,000 ’. There was a switch made where out o f Amiens £5,000 would have been paid. M r X, as fa r as he is concerned has got the funds out o f his account, but in the Cayman books what would have happened is that M r A B C ’s account would have been debited with £5,000 and M r X ’s account would have been credited with £5,000. So, no exchange did happen between the main account and Amiens Securities in that instance. 2.8 Q That was avoiding any problems in relation to exchange control? A That is one o f the scenarios, yes. ’ Mr Traynor on the Board of GMCT On the incorporation of GMCT, Mr Traynor was appointed a director. He was described for many years as the Chairman of the company and was still on the board of directors of Ansbacher (as it had by then become) at the date of his death, 11 May 1994. Ansbacher has informed the Inspectors that Mr Traynor was not a director from 1974 to 1981. There is some evidence that the Central Bank was informed of the intention of GMCT to protect itself against potential Irish tax complications by not having Irish officers. The Inspectors have concluded that any such formal decision was cosmetic only and that Mr Traynor should be considered a director or shadow director of GMCT from the date of its incorporation to the date of his death. On 18 March 1981, the board of GMCT passed a resolution to the effect that the duties of Mr Traynor would be performed solely in the Cayman Islands and that his authority to act on the company’s behalf would be limited accordingly. Despite this formal position, Mr Traynor until the date of his death carried out in Dublin executive functions for and on behalf of GMCT/Ansbacher. He remained based in Dublin, visiting Cayman three or four times a year to attend board meetings and to assist Mr Furze in the reconciliation of the memorandum accounts with the clients’ accounts in Cayman. The duties he performed on behalf of GMCT remained predominantly Irish-based. 2.9 College Trustees Limited In 1981, certain events caused GMCT’s Irish business to increase substantially. Guinness and Mahon had a Channel Islands subsidiary called Guinness Mahon Channel Islands, which in turn had a subsidiary called College Trustees Limited. As its name suggests, College Trustees was a trustee company, and it managed trusts for a number of wealthy Irish clients. It had accounts in its own name in Guinness and Mahon up to 1981. In that year, for reasons that remain unclear, College Trustees deposited the funds of its Irish clients with GMCT. From then until 1989, the funds of these clients were held in Guinness and Mahon in an account entitled GMCT re College Trustees Limited. 2.10 Mr Richard Fenhalls and the sale of GMCT to GMOIL Also in 1981, Mr Richard Fenhalls was appointed Chief Executive of the Guinness Mahon Group based in London, and was further appointed a non-executive director of Guinness and Mahon. From 1971 to 1976, Mr Fenhalls had been a director of Irish Intercontinental Bank Limited, (now known as IIB Bank Limited), (‘IIB’). From 1981 to 1984, he was Chief Executive of the Guinness Mahon Group, and a non-executive director of Guinness and Mahon. From 1985 to 1992, he was chief executive of Henry Ansbacher & Company Limited, and from 1988 to 1992, he was a director of the Company under investigation. It was he who, in 1991, introduced Ansbacher business to IIB. This matter is described in greater detail elsewhere in this Report. In his capacity as chief executive of the Guinness Mahon Group, Mr Fenhalls had met the management of GMCT. He had found GMCT to be a profitable and useful organisation. When therefore, in 1984, Guinness and Mahon found its solvency threatened as a result of a series of disastrous venture capital investments that made a total loss of some IR£7 million, Mr Fenhalls devised a plan whereby the shares in GMCT were sold to another company in the Group, Guinness Mahon Overseas Investments Limited (‘GMOIL’). The price paid by GMOIL offset the venture capital loss. Mr Fenhalls left Guinness Mahon shortly thereafter, and was appointed as chief executive of the Henry Ansbacher group. 2.11 Mr Traynor leaves Guinness and Mahon In February or March of 1986 - apparently as the result of a disagreement with London management - Mr Traynor resigned from Guinness and Mahon. As part of a severance package, the bank permitted him the use of an office in Trinity Street, Dublin, equipped with a computer. He was also permitted to bring with him his secretary of many years, Ms Joan Williams. He continued to be active as a director of GMCT, carrying out his functions first from the office in Trinity Street and later from his office in the CRH premises at 42 Fitzwilliam Square, Dublin, following his appointment as Chairman of that company in 1987. 2.12 Mr Traynor opens accounts with NCB In 1987 or 1988, Mr Traynor approached Mr Dermot Desmond of NCB Stockbrokers with a request to open a number of accounts. In all, seven accounts were opened, all in the name of an NCB nominee, Aurum Nominees. Each account was individually identified by an account number, and each had its own bank account in Ulster Bank, College Green, Dublin. NCB was informed that the beneficial owner of all seven accounts was Overseas Nominees Limited. Overseas Nominees was a Cayman company, and was the nominee company of Ansbacher although NCB was not aware of this at the time. The Inspectors are satisfied that the seven accounts in question appear to have been held for the benefit of clients of Ansbacher. Movements on the accounts and on their corresponding accounts in Ulster Bank show that funds from the Ulster Bank accounts were regularly paid into Ansbacher’s accounts in IIB. The Inspectors are satisfied that NCB has not committed any wrongdoing in connection with the accounts. 2.13 Sale of GMCT to Chichester Investments Limited Meanwhile, in his new position in London, Mr Fenhalls had set about building up an offshore banking group for the Henry Ansbacher Group. Henry Ansbacher already had companies in the Channel Islands and in Gibraltar, but had nothing in the Cayman Islands. Remembering the good impression GMCT had made upon him, Mr Fenhalls phoned Mr Traynor and told him that if the company ever became available on the market, Henry Ansbacher would be interested in purchasing it. By then, having traded for a number of years in Cayman, GMCT’s deposit base had broadened to include depositors who were not Irish. These new depositors were sourced principally from the United States and Jamaica. Some time in 1988, Mr Traynor contacted Mr Fenhalls and told him that he, John Furze, John Collins and Hugh Hart (a Jamaican based lawyer who was at that time a director of GMCT) were ‘tired o f what was going on in Guinness and Mahon ’ and, as a result of their dissatisfaction, they intended to purchase GMCT themselves. He proposed that they would then discuss a sale to Henry Ansbacher. Mr Fenhalls wished to do a deal directly with Guinness and Mahon, but Mr Traynor dissuaded him from this course for reasons that are unclear. Consequently, in June of that year, a Cayman company, Chichester Investments Limited, the beneficial owners of which were Messrs Traynor, Furze, Collins and Hart, purchased GMCT from GMOIL. It appears that at the time of the Chichester purchase, the name of the Cayman company was changed from Guinness Mahon Cayman Trust Limited to GMCT Limited - presumably because it would not be possible for Chichester Investments Limited to use the name Guinness Mahon. 2.14 Sale of GMCT to the Henry Ansbacher Group Following the sale to Chichester Investments Limited, Mr Fenhalls and another director of Henry Ansbacher, Mr John Button, set about negotiating the purchase of a majority shareholding in GMCT. In August 1988, Henry Ansbacher Holdings pic acquired a 75% shareholding at a price of £750,000 cash plus shares in Henry Ansbacher Holdings pic valued at £2.25 million. Henry Ansbacher Holdings pic took £2.25 million worth of shares in GMCT on a new issue. The vendors subscribed for an additional £750,000 worth of new shares. Finally, as agreed by Henry Ansbacher Holdings pic, Henry Ansbacher & Co Limited in London injected a further £2.5 million into GMCT through subscription for subordinated loan stock. The parties agreed that the interests still held by Messrs Traynor and Hart would be purchased five years after the date of completion. In the case of Messrs Furze and Collins, 50% of each of their shareholdings was to be purchased five years from the date of completion, and the remainder upon the severing of their employment with the company. Furthermore, the minority shareholders undertook to guarantee certain loans that were considered to be a bad risk. 2.15 Change of name of GMCT and Mr Traynor appointed as Chairman Following the share sale, GMCT’s name was changed to Ansbacher Limited on 29 August 1988. It remained under that name until November 1992, when it became known as Cayman International Bank and Trust Company Limited. Mr Traynor was appointed non-executive Chairman, which position he held until 27 April 1993. Thereafter he continued as a non-executive director until his death in 1994. 2.16 TTB and Kentford Securities Limited Meanwhile, Ansbacher (as it was now called) had continued to hold accounts in Guinness and Mahon. By 1990, Mr Fenhalls had become increasingly worried about the credit­ worthiness of Guinness and Mahon and had come to the view that it was unsafe for Ansbacher to continue to place large group deposits with it.2 He discussed the position with Mr Traynor, who, according to Mr Fenhalls, was reluctant at first to close the accounts. Finally, however, on the instructions of Mr Fenhalls, he did so, and he opened new accounts with KB in Dublin. Mr Fenhalls had first paved the way with that bank where of course he was well known, having formerly been a member of its board. Ansbacher thus became a customer of IIB, holding accounts in the same way as it had held them in Guinness and Mahon, namely, on behalf of its clients. Memorandum accounts continued to be maintained by Mr Collery in Mr Traynor’s office in CRH pic, and everything continued as before, with one exception. IIB did not have a counter service, and persons requiring cash withdrawals from their Ansbacher accounts were unable to obtain it directly from IIB. Instead, Mr Traynor made use of an account in the Bank of Ireland’s branch in St Stephen’s Green in the name of a company called Kentford Securities Limited. The practice was that IIB would issue a cheque or draft in the required amount payable to Kentford Securities, and the cash would be withdrawn from that account on the instructions of Mr Traynor who was one of the signatories. The cash would then be passed on to the client. The involvement of IIB in the Irish business of Ansbacher is considered in detail elsewhere in this report. Ansbacher remained a customer of Guinness and Mahon to a small extent even after 1991, with some cash-backed loan accounts remaining on the books until 1998, after the takeover of Guinness and Mahon by the Irish Permanent Building Society in 1994. 2 Much of this portion of the narrative is taken from the transcript of evidence of Richard Fenhalls 2.17 Hamilton Ross At this point in the narrative it becomes necessary to introduce Hamilton Ross Company Limited (‘Hamilton Ross’), whose function in the conduct of Ansbacher’s Irish business came to light in the early 1990s. Hamilton Ross is a Cayman registered limited liability company incorporated in 1981. The first directors of the company were Mr John Furze, Mr JD Ashenheim and Mr PA Harty, all employees of the then GMCT. shares in his capacity as trust company officer. Each held The directors remained unchanged until the aftermath of the events of September 1992, which are described in Chapter 12. Hamilton Ross was in all respects typical of the Cayman companies used by Ansbacher to carry out its business. By reason of Ansbacher’s status as a trust company (in addition to its existence as a bank), Ansbacher operated in respect of most of its clients through limited liability companies controlled by itself. In the Ansbacher method of operation, a client based in Ireland or elsewhere did not have a direct account with the Ansbacher bank but either used a trust (to which one or a number of companies would be attached), or deposited funds with the bank in the name of a limited liability Cayman company. It was a feature of this method of operation that Cayman companies were often rendered obsolete when the underlying customer closed his or her account or changed his or her method of operation. The Inspectors have come across many cases where these ‘spent’ entities were revived and used for a different customer’s purpose. Hamilton Ross was one such ‘recycled’ company. Up to 1 January 1988 it was beneficially owned by American clients of Ansbacher. It was dormant from that date until October 1988 when Ansbacher began to use it to hold the combined funds of a number of sterling depositors whose funds were not considered large enough to warrant the expense of individual companies. Prior to October 1988, it appears, according to Ansbacher’s evidence, that the funds of such small depositors had been held in Poinciana Fund Limited, another Cayman company. After that date, some monies remained in Poinciana, but the majority was moved to Hamilton Ross. In 1992, all Hamilton Ross accounts were taken off Ansbacher’s books, at the direction of London management. At the same time, Mr Traynor gave instructions to IIB to close certain accounts that had been held in that bank in the name of Ansbacher, and to transfer the funds to new accounts, which were opened in the name of Hamilton Ross. This was the first appearance of that company on the Irish scene. The effect of these instructions was that clients’ funds, which had up to that time been held in an Ansbacher pooled account in IIB, and held in an account in the name of Hamilton Ross in Ansbacher in Cayman, now ceased to be held in any Ansbacher account either in Ireland or in Cayman. Instead, they were held on the clients’ behalf in IIB in an account in the name of Hamilton Ross Limited. Thus from then on, some people who had hitherto been clients of Ansbacher became simply clients of Hamilton Ross. 2.18 Sale of Henry Ansbacher Group to First National Bank of Southern Africa, and further change of name of the Cayman Company On 20 January 1993, the entire Henry Ansbacher Group was purchased by First National Bank of Southern Africa Limited. Messrs Traynor, Furze, Collins and Hart retained their 25% shareholding in the company until 30 April 1993, when their shares were acquired, on behalf of the new owners, by Ansbacher Trust Group Services Limited. The Company assumed its present name of Ansbacher (Cayman) Limited in September 1994. As noted above, Mr Traynor resigned as chairman and became a non-executive director in April 1993, which position he held until his death in May 1994. Mr Traynor’s death was unexpected, and caused some panic among the Irish clients of Ansbacher. Mr Collery was forced to take over Mr Traynor’s role at short notice, and after a brief period of some disarray, he began the winding down of operations in Ireland. Mr Collery had never been an employee of the Cayman bank, but had, it appears, been paid personally by Mr Traynor. However, following Mr Traynor’s death, he was paid a retainer by Ansbacher to ‘ensure an orderly transition in respect o f /Ansbacher]’.? dealings with Irish clients’ (see Information Document provided to the Inspectors by Ansbacher (Cayman) Limited at Appendix 11(c)). In April 1995, Mr Furze resigned as executive director (he died in 1997) and Mr Collins became a non-executive director, which position he held until his resignation on 31 October 2000. 2.19 Sale of First National Bank of Southern Africa to FirstRand Limited Finally, following the merger of Rand Merchant Bank Holdings and Anglo American to form a new company, FirstRand Limited, the shares of First National Bank of Southern Africa Limited were acquired by FirstRand in 1998. FirstRand, therefore, is the current owner of Ansbacher (Cayman) Limited. CHAPTER 3 THE SERVICES OFFERED BY ANSBACHER (CAYMAN) LIMITED AND THE POLICY OF CONCEALMENT IN OPERATION INDEX Page 3.1 Introduction 44 3.2 Use of Discretionary Trusts by Irish Clients 44 3.3 Trusts established by GMCT 47 3.4 Knowledge of GMCT and Guinness and Mahon 49 3.5 GMCT accounts in Guinness and Mahon 54 3.6 The memorandum accounts 55 3.7 Concealment of memorandum accounts 56 3.8 1976 Central Bank report on Guinness and Mahon 57 3.9 Destruction of Ansbacher’s records 58 3.10 Irish clients’ lodgements and withdrawals 58 3.11 Payment to Mr Haughey 59 Page 3.12 Concealment of clients’ identities in statements of account 60 3.13 Transfer of Ansbacher’s business to 42 Fitzwilliam Square 60 3.14 Transfer of Ansbacher’s business to Winetavern Street 61 3.15 Back-To-Back Loans 61 3.16 Limited information to auditors 62 3.17 Limited information to Central Bank 63 3.18 Caveat regarding the ‘suitably secured’ reference 63 3.19 Concealment of banking operation from Central Bank 64 3.20 Concealment of banking operation from Cayman Authorities 64 3.21 Conclusion 64 CHAPTER 3 THE SERVICES OFFERED BY ANSBACHER (CAYMAN) LIMITED AND THE POLICY OF CONCEALMENT IN OPERATION 3.1 Introduction In this chapter, the Inspectors seek to identify the various services offered by Ansbacher (Cayman) Limited and to ascertain the true nature of its business. There were three essential services offered by Ansbacher as part of its Irish business. There was firstly a discretionary trust facility. Secondly, there were deposit or memorandum accounts maintained in the name of Ansbacher in Dublin to which Irish clients could make lodgements and from which they could make withdrawals. By this means, they were enabled to lodge their funds offshore but still have access to them in Ireland as though they had never left the jurisdiction. Thirdly, Ansbacher participated in the provision of back-to-back loan facilities to their clients. A feature of each of the services offered by Ansbacher is the extent to which secrecy or concealment was an essential element. Ansbacher’s policy of concealment is highlighted in this chapter. Having reviewed the various services offered by Ansbacher and the manner in which they were operated, the Inspectors conclude in this chapter that Ansbacher knowingly promoted tax evasion by Irish clients. 3.2 Use of Discretionary Trusts by Irish Clients Discretionary trusts have a long history of use by those with wealth to protect their own interests and the interests of later generations. It is a feature of the genre that assets are transferred from the control of the owner ( ‘the prime mover’) to a structure founded on a trust deed for the benefit of beneficiaries, who sometimes include the prime mover. In this way the fund appears to be legally independent of the wealthy individual who was the prime mover. The key attribute of a discretionary trust, as opposed to other forms of trust, is that the trustees are given discretion as to how they apply the assets for the benefit of the beneficiaries. There are many different reasons for establishing a trust and many different methods of implementing the process. Sometimes this is achieved by having the settlor (the person who notionally establishes the trust) a person other than the prime mover. The settlor establishes the fund with a nominal sum, which, after the paper work has been completed, is augmented by the assets or funds of the prime mover. When established, the trust is controlled by trustees who sometimes use a company to hold the assets. The assets can be further separated from the trustees by the use of subsidiary companies as required. In some cases, the funds are put into the control of managing agents who make the day-to-day decisions, relegating the function of the trustees to one of general supervision. The purpose of the structure is to preserve the property rights of the beneficiaries. These beneficiaries may be identified in the trust deed by name or by description. In many cases, the prime mover of the structure arranges to name his or her spouse as the principal beneficiary with their wider family as other beneficiaries. Indeed, the prime mover himself may also be named as a beneficiary. In other cases, the beneficiaries may be simply described as a class such as the children of the prime mover. Many companies offer the service of acting as professional trustees to persons wishing to set up trusts. In such cases, of course, the trustees cannot know intimately the affairs of the prime movers and families for whom they act. At the same time, the legal effect is to grant to the trustees legal authority and a wide discretion as to how they deal with the assets. Letters of Wishes Typically in a discretionary trust situation, the prime mover in the scheme is given the comfort of transmitting to the trustees a ‘letter of wishes’. This document, which is not legally binding, informs the trustee of the wishes of the person who provided the funds and lists the intended beneficiaries. The letter of wishes is not part of the trust deed. Its purpose is to give the prime mover a measure of comfort in light of the fact that by placing his assets in trust he or she is handing legal control of them over to the trustees who he or she may not know. It also provides guidance to professional trustees who may act for several hundred cases and could not otherwise know the intention of each client. A letter of wishes, as its name suggests, is a document provided by a settlor to the trustees explaining his or her thoughts on how he or she would like the trustees to exercise their powers and often, specifically envisaging how he or she would like them to divide the trust property. For example, in the case of a discretionary trust where the beneficiaries are described as a class comprising the prime mover’s children, he or she might explain that it would be his or her wish that the trust property should, after a certain period, be divided equally among his children. It should be emphasised that a letter of wishes is not binding on the trustees. Their duty is to act on an independent basis in exercising such discretion as they have been given by the trust deed in making decisions. Protector Another device sometimes used to give added comfort to the prime mover is the appointment of a protector. A protector is not a trustee because the trust property is not vested in him or her. He or she merely holds certain powers given by the trust deed. Typically, the powers granted are those of monitoring and agreeing trustees fees, giving or withholding consent to certain transactions, the right to be consulted and, perhaps, have the power of veto in respect of appointments to beneficiaries or the sale of trust property and the right to remove trustees and appoint new ones. Taxation issues Schemes established by those living within this jurisdiction in the past conferred some tax advantages on those involved. However, various Finance Acts have eroded these benefits. In particular, after 1974, foreign based trusts were largely rendered ineffective for income tax purposes by anti-avoidance legislation. At the present time, Irish trusts still have some uses in respect of protecting the interests of minors and those under a legal disability. They are also used in inter-generational asset transfer management. To understand the background to the discretionary trust schemes operated by GMCT, one must return to the early 1970s. In that era, personal tax rates were high and the political preparations were underway to introduce capital taxes such as Capital Gains, Capital Acquisitions and Wealth Taxes. In these conditions, those with money were concerned about their financial future and were receptive to schemes that appeared to offer a measure of security. The class of person with these concerns was also coincidentally the target market of Guinness and Mahon, who wished to provide personal banking services to wealthy clients. The major accountancy firms in Dublin at that time were developing tax strategies to respond to their clients’ concerns. Guinness and Mahon facilitated this development by providing vehicles to implement such schemes. It was a common feature of such schemes that those wishing to avail of them wanted to locate their assets in tax havens abroad. As outlined in Chapter 2, the main purpose in establishing GMCT was that Guinness and Mahon would own a trust company in the Cayman Islands. Guinness and Mahon already had such companies in the Channel Islands. The structure of the schemes continued to develop over the years and the complications brought about by the need for secrecy (as outlined below) encouraged the proliferation of companies and trusts. 3.3 Trusts established by GMCT The trusts established by GMCT differed in certain details to the general scheme outlined above. The true object of the scheme was sometimes hidden by listing as the beneficiaries a class of persons such as ‘all those who have contributed £10 to the Red Cross’. This device enabled the trustees to distribute money to persons who could not be identified by reading the trust deed, so keeping the true object of the trust secret. Of course, this type of scheme depended on the trustee using his or her powers in accordance with the wishes of the provider of the assets. The use of a letter of wishes is a legitimate method by which comfort is given to prime movers who appoint professional trustees whom they may not know personally. However, as can be seen from the ‘Note to John Furze’ document, which will be dealt with below, the purpose of letters of wishes was distorted in the way that it was presented to potential GMCT clients. It is clear that the letter of wishes was promoted by GMCT as an added element in the culture of secrecy. The power to change the trustee or trustees is a vital control mechanism and this power is normally given to the settlor. Simultaneously with the setting up of the scheme, however, the settlor in the GMCT case immediately conveys his or her right to appoint new trustees to the prime mover (who of course is usually the wealthy person who set the whole process in motion). By these processes, the prime mover supplied the assets to the fund, retained the right to hire and fire those who controlled the fund and remained a beneficiary of the structure. However, he or she was not identified in the trust deed. In the early 1970s, when many of the GMCT trusts were established, neither GMCT nor its clients were acting illegally by establishing such trusts. Provided the funds transferred to the trust were tax paid or tax-free, the transaction was lawful in all respects. However, once the trusts had been established, those involved had a continuing obligation to operate them in a manner consistent with the laws of the Cayman Islands. Further, those who received a taxable benefit at any time thereafter from the fund had potential tax obligations in their country of tax residence. A feature of the system as operated was that at least some of the funds of trusts serving Irish prime movers were transferred back to Ireland to Guinness and Mahon in Dublin and held there in accounts in the nominal name of GMCT. The reality was that these funds were available to those who had established the trust. The Irish prime movers were enabled to use the GMCT accounts in Guinness and Mahon as a means of withdrawing cash from the trust funds when needed, lodging new funds or using the funds to secretly provide security for back-to-back loans, as described in greater detail further on. If these persons had returned to the Irish Revenue Commissioners those elements of these transactions giving rise to Revenue implications, no law would have been broken. However, in more than 100 cases (relating to both trusts and deposits) in which the Inspectors addressed Revenue issues, they did not discover a single case where contemporaneous tax returns were made in respect of these transactions. The Inspectors must stress, however, that they did not address this issue in respect of every person identified as a client in this report. Therefore, they urge all those with access to this report to recognise that the individual tax affairs of the clients of Ansbacher were not within the Inspectors’ remit (see Chapter 22) and to exercise caution before concluding in any individual case that a particular client defrauded the Revenue authorities. However, in the opinion of the Inspectors, there is evidence tending to show that the scheme as operated by Guinness and Mahon and GMCT facilitated the widespread evasion of tax. 3.4 Knowledge of GMCT and Guinness and Mahon On the other hand, the fact that some customers failed to make tax returns of distributions received from their trusts through the GMCT accounts in Guinness and Mahon is not conclusive evidence that either Guinness and Mahon or GMCT knew or approved of such behaviour. The evidence relating to the possibility that these companies actively participated in a scheme of tax evasion must be considered separately. As already reported, GMCT had a number of deposit accounts in Guinness and Mahon, and, to an increasing extent over the years, these were used to provide funds for beneficiaries of trusts of which GMCT was trustee. No evidence has emerged that these payments were made as a result of decisions by trustees to make distributions to beneficiaries. Among files of over 50 trusts furnished to the Inspectors by Ansbacher (Cayman) Limited following litigation in the Grand Court of the Cayman Islands, not a single document exists minuting a decision of the trustees to make a distribution. On the contrary, all the evidence points to the request for payment originating with the client and being processed in Guinness and Mahon (and later in IIB) upon the instructions of Mr Traynor. GMCT was not informed of the completed transaction until Mr Collery (having posted the transaction in the secret Irish memorandum accounts or otherwise processed it internally within Guinness and Mahon) sent a reconciliation statement to Cayman, which he did on a monthly basis. This is strong evidence that the trust structure was a sham - not in respect of its legal status at the time of establishment, but in the manner of its operation - and that GMCT exercised no effective control over the assets nominally under its control. The back-to-back loans, considered in more detail further on, are additional evidence that the trust structure was a legal fiction. One example will suffice to illustrate this. Mr John Byrne (see Chapter 23) established two complex trust structures, one for Irish and one for UK business. These trusts were alleged to be completely separate from each other and from Mr Byrne. All the liquid assets happened to be in one trust, but back-to- back loans were granted by Guinness and Mahon to a company owned by the trust which did not have cash, backed by the funds of the other ‘independent’ trust. No fee was charged for this financial service. To give what amounted to a cash guarantee to a stranger, without charge, would be a breach of the trustee’s fiduciary duty. experienced trust company such as GMCT transaction and that That an approved of such an irregular financial Guinness and Mahon accepted this security suggests that both institutions viewed these trusts as legal fictions. It seems evident that both trusts were operated as one in the interest of Mr Byrne with the knowledge and approval of Guinness and Mahon and GMCT without reference to their legal status. The Inspectors are of the view that further strong evidence as to the knowledge of GMCT and Guinness and Mahon, and their involvement and promotion of tax evasion, comes from a remarkable document produced by Mr Raymond McLoughlin, headed ‘Note to John Furze ’ (see Appendix 111(a)). The Inspectors accept the evidence of Mr McLoughlin that he himself was not a client of Ansbacher but that he produced this document after a meeting with Mr John Furze in September 1983, which was arranged by Mr Traynor and held in the Guinness and Mahon offices in Dublin. Mr Furze, as an executive director of GMCT, was the named settlor in many of the trusts established by that Company. Mr Traynor was at that time Deputy Chairman of Guinness and Mahon and was its link with GMCT. He was also Chairman of GMCT. The LNote to John Furze ’ document outlines the method GMCT used to set up discretionary trusts for their Irish clients. In relation to the concealment of the names of their clients, the document confirms that Mr Furze advised Mr McLoughlin that Ansbacher accepted the use of nom-de-plumes by clients in the listing of the names of the beneficiaries of the trust. It also confirms that individuals or companies can be included in this list if they contribute $10 to the Red Cross, once a clause to this effect is inserted in the trust deed. It reports Mr Furze as stating that the Letter of Wishes in practice bestows upon the initial owner of the funds the right to instruct the trustees, which is not the case in genuine trusts. It goes so far as to state: ‘in practice the Trustees will do nothing except as instructed by the client or by such person as is nominated by the client. ’ It acknowledges that clients: ‘do not like committing instructions to the Trustees to paper, and allows fo r the client to have his or her wishes acted upon merely by telephoning the Trustees money can be moved, invested or divested from time-to-time simply through a telephone call to a contact operating on behalf o f the Trustees. ’ Dealing with a situation where the client wishes to move all of the funds out of the Trust and discontinue its operation, the document states that it would be: ‘legally possible fo r him to remove the Trust Deed and the Letter o f Wishes and any other correspondence and to obtain a certificate from the Trustees that there were no copies anywhere ’. Mr Furze was happy at the same time to confirm that: ‘the Bank in Ireland can swear to the Revenue as to the non-connection in the legal sense between any parties it might be inquiring about and any legal Trust [because] it is factually and legally correct to state that the Client does not own any o f the assets held by the Discretionary Trust and is therefore not in breach o f exchange control regulations This reflects the sham nature of the GMCT trust operations. The Note to John Furze goes on to outline the advantages of the Cayman Islands as a location for offshore funds, and the focus is on secrecy and tax avoidance. It points out that ‘there is no taxation in the [Cayman Islands].’ It notes the existence of the ‘Cayman Islands Secrecy Act’ (the Confidential Relationships (Preservation) Law), and notes that the Cayman authorities were unlikely to amend this to disadvantage investors, as ‘finance’ was probably the major economic activity on the Island. It points out that the British government does not have the power to change the law without the consent of the Islands’ authorities. The Islands’ distance and remoteness are extolled as virtues, and, in a comparison with the Channel Islands, Cayman is favoured for these reasons and also because: ‘it is fe lt that the [Channel Islands are] more vulnerable in the sense that there is a suspision [sic] already that the Authorities in the [Channel Islands] and the authorities in the UK exchange information. ’ The document discusses in detail the level of secrecy involved in the trust arrangements. It notes that all of the GMCT officers dealing with the trust arrangements are bound by the Confidential Relationships Law, and, in practice, the officers privy to the trust documents would be limited to: It is confirmed that: ‘nobody in Dublin other than the two principals would know about any Trust arrangement. ’ The concealment of the trust’s existence is almost watertight, and is contrasted to the lack of confidentiality of a Will (which the Trust can bypass), which: ‘even in the [Cayman Islands]. ... would be a registered public document and the tax authority in any part o f the world would be free to look at it. ’ No record ‘o f any kind anywhere in Dublin or any reference in any correspondence between GMCT and Dublin in relation to any Trust arrangement ’ would exist and no duplicate copies of Trust documents would be held anywhere outside of GMCT. In fact, the document states that for any interested party to identify: ‘a possible linkage between an individual and a particular Trust arrangement, it would be necessary that one or other o f the parties who are aware o f this arrangement would disclose that or that through detection work or theft or accident that sight would be obtained either o f the Trust Deed or the Letter o f Wishes or any other correspondence pertaining to the Trust arrangement. ’ Mr Furze discussed with Mr McLoughlin the various means by which the linkage between a client and a Trust arrangement could be concealed. In a section titled ‘Towards Minimising the Footprints ’, an analysis of possible methods of achieving this is presented. The clear intention is that the Trust Deed and the Letter of Wishes should not reveal the link with the client, in the event of these documents falling into the hands of 1 ‘X (l) ’ was previously signified in the document as being a person who would act as a conduit between the client and the trustees. ‘interested parties’ despite all of the above efforts. The purpose of tax evasion is pinpointed when the document focuses not on the potential discovery by the Revenue authorities of the Trust itself, which can be legally disowned by the client, but on the potential discovery of the assets transferred to the Trust by the client. The source and size of these assets could give rise to an unwelcome Revenue investigation of the client’s affairs. The detail and thrust of the ‘Note to John Furze ’ indicates a system of trust arrangements devised and operated for people of wealth who wished to conceal at least some of their assets from the relevant authorities. The high level of secrecy apparent from the document shows that the clear purpose of the GMCT trust operations was to conceal both the initial investment sum and the ongoing investment held by their clients and to conceal the identity of those clients. All of the foregoing strongly suggests that tax evasion was central to the package that GMCT was marketing with the support and active assistance of Guinness and Mahon. The ability of the prime mover to dismantle the trust is strong evidence that the scheme was, by this stage, little more than a charade. The Note to John Furze is further evidence tending to show that both Guinness and Mahon and GMCT promoted the scheme as a tax evasion vehicle. 3.5 GMCT accounts in Guinness and Mahon As described in Chapter 2, GMCT had opened a number of non-resident accounts in its own name in Guinness and Mahon. Into these accounts GMCT transferred the money of its Irish clients. During the first few years of the operation of the accounts, Guinness and Mahon maintained a deposit account ledger, with each separate customer account having a different code. The customer accounts were maintained by the late Mr Ru Leonard, who was accounts manager in Guinness and Mahon at the time. The ledger contained on its face the instruction that no information was to be given to auditors: ‘N o authority to supply inform, over the phone or to auditors ... This account is non resident and details o f int. is not therefore to disclose to the Rev. Authorities. Entries to this account must originate from T.R.L. i f not refer to T.R.L.2 I f authority is not received then post to Sundry Persons ’ 3.6 The memorandum accounts Some time in the late 1970s, a change occurred, in line with GMCT’s policy of concealment. The deposit account ledger was removed from the books of Guinness and Mahon and new call and fixed deposit accounts were opened in the name of GMCT. These accounts, as is clear from an internal audit carried out by Guinness and Mahon’s London parent in February 1989 (see Appendix 111(b)), contained funds lodged with GMCT by Irish and other customers. Those accounts that were held in foreign currency remained on the books of Guinness and Mahon, bearing the name of GMCT but with a coded sub-designation. All accounts held in sterling were pooled, and placed in one large account in GMCT’s name. Records of the sub- (or ‘memorandum’) accounts of the pooled account did not appear on Guinness and Mahon’s books, but instead were kept on a computer system maintained by Mr Padraig Collery, Mr Leonard’s successor as accounts manager. This computer system, although sharing the same hardware as Guinness and Mahon’s own system, was completely independent of it. Customer names were not held on this system; instead, each account was identified by a code. Meanwhile, in Cayman, each Irish customer’s account, whether sterling or other currency, was held in the name of a company allocated to that customer, thus ensuring that the real client’s name did not appear at all. In some cases, companies were ‘recycled’ for new clients, making it even more difficult at any given time to identify the true beneficial owner. As shown in Chapter 2, some depositors whose funds were considered to be too small to warrant the services of an individual company had their deposits pooled and held in the name of one of two companies - Poinciana Fund Limited or Hamilton Ross Limited, where they were sub-designated by the code they held in Dublin. Mr TR (‘Ru’) Leonard The system can be exemplified by the following imaginary cases: (a) Joe Bloggs. American Dollar deposit Dublin: Funds held in account GMCT re JB (or possibly re JoblogLtd) on the books of Guinness and Mahon. Cayman: Funds held in account Joblog Limited. (b) Mary Smith. Large Sterling deposit Dublin: Funds held in GMCT pooled account on the books of Guinness and Mahon. Record kept in Memorandum Account X/Xl. Cayman: Funds held in account Maysmit Limited. (c) John Doe. Small Sterling deposit Dublin: Funds held in GMCT pooled account on the books of Guinness and Mahon. Record kept in Memorandum Account X/X2. Cayman: Funds held in account Hamilton Ross, sub-designation X/X2. 3.7 Concealment of memorandum accounts The method of maintenance of the memorandum accounts indicates the high level of secrecy involved on the part of both GMCT and Guinness and Mahon. In 1978, Mr Furze, who was then one of GMCT’s joint managing directors, had written to Guinness and Mahon, requesting them to provide computer accounting services for the GMCT accounts. In this letter he states: ‘We would only request that you provide such a service on the basis that all information provided by us remains our sole property as also will all information stored within the computer programme. Needless to say, we will also require your written assurance that neither the programme information stored nor the accounting records themselves, are made available to any third parties such as auditors, bank inspectors, etc. ’ This indicates that the Cayman bank wanted the details of their accounts maintained separately from other Guinness and Mahon records and outside of their official records, thereby ensuring that they would not be disclosed to any of the relevant authorities. 3.8 1976 Central Bank report on Guinness and Mahon In 1976, the Central Bank examined and reported on Guinness and Mahon. It appears that during the course of their examination the directors of Guinness and Mahon told them that the bank held no files or records relating to any transactions between their customers and the offshore companies, including GMCT. Guinness and Mahon told the Central Bank that they feared ‘that the retention of such files would give grounds to the Revenue to claim that the companies are managed by Dublin and also individual files might come into the hands of the Revenue Authorities.’ (see Appendix 111(c)). Clients’ identities remained secret. The identity of all the persons to whom the codes referred was known only to Mr Traynor, although Mr Collery and Ms Williams became aware of the identity of some of the clients. Ordinary staff members working in Guinness and Mahon were not aware of the significance of these codes, and processed each transaction as directed by their managers. A data inputter working to Mr Collery in Guinness and Mahon stated in evidence to the Inspectors that the Cayman records were stored on diskettes or tapes, separately from other accounts. The diskettes were stored in a special cabinet which was kept locked, the key to which was held by Mr Collery only. He would give the staff member in question the key to the cabinet and special headed paper for her to work on and produce statements. He would also furnish her with the data which she was to input into the computer. She worked with lists of debits and credits and was unaware of the significance of the coded references. She handed all work back to Mr Collery and told the Inspectors that none of it was filed with other Guinness and Mahon account files. She also handed the cabinet key back to Mr Collery, having locked away the tapes after completing the tasks. This work was usually done after hours, when few other staff members were in the office. 3.9 Destruction of Ansbacher’s records On Mr Traynor’s death, most of the GMCT records in Dublin were either destroyed by Mr Furze or brought back by him to Cayman. 3.10 Irish clients’ lodgements and withdrawals Money arrived under GMCT’s control by various means. Mr Traynor appears to have decided the method in each particular case. During the period relevant to this Report, different foreign exchange control regimes operated which required changes from time to time in the system of operating the accounts. When the system was first set up, direct lodgements were the norm. An examination of the GMCT account in Dublin for part of November 1974 appears to show relatively straightforward records of direct lodgements (see Appendix 111(d)). Over the years this changed and an increasingly confused - and confusing - lodgement pattern developed as part of the policy of concealment to be discussed further on. However, what is clear is that the most usual lodgement method was through Mr Traynor himself. The Inspectors have received evidence from many clients of Ansbacher to the effect that they gave bank drafts or cash to Mr Traynor for lodgement to their offshore accounts. Through Mr Traynor, however, the money reached its final destination by any one of a number of means - through the Amiens accounts, through a seven-day-notice account in Guinness and Mahon’s name in Guinness Mahon London, or on occasion, directly into the sterling pooled account in Guinness and Mahon. It also seems that some clients may have dealt directly with Cayman, bypassing Mr Traynor entirely. In general, however, it can be said that when an Irish client, whether his funds had been settled on a trust or simply deposited, wished to make a lodgement or a withdrawal, he simply contacted Mr Traynor, who, as a signatory on the GMCT accounts, issued the appropriate instructions. In the case of clients whose funds were in the pooled account, Mr Traynor would issue an additional instruction, this time to Mr Padraig Collery who would make the necessary entry in the memorandum accounts. In the case of a withdrawal, Mr Traynor would give or send the funds to the client, frequently in cash but sometimes in the form of a bank draft. On occasion, he would arrange to have the required sum transferred to a bank account in the name of the client outside the jurisdiction. The Inspectors have received evidence from many of the Irish clients that they made large cash withdrawals, which Mr Traynor, Mr Collery or Ms Joan Williams would hand to them either in the offices of Guinness and Mahon or of CRH, or by arrangement at another venue. For example, Mr David Doyle gave evidence of frequent meetings with Mr Traynor in the lobby of the Berkeley Court Hotel in Dublin for the purpose of receiving money he had requested Mr Traynor to withdraw for him. The Inspectors have also heard evidence from the CRH caretaker and from Mr Traynor’s driver in CRH, who recollected making cash deliveries to clients of Ansbacher. Further detail on the lodgement and withdrawal of money by Irish clients will be found in Chapter 15 that deals with the involvement of CRH. 3.11 Payment to Mr Haughey The example of one of the payments made by Mr Ben Dunne to Mr Charles J Haughey provides a good picture of the complicated system of transferring funds that was in operation. In December 1987, a Dunnes Stores cheque for stg£l 82,630 was given to Mr Traynor and passed by him to Guinness Mahon London, with instructions for them to lodge it to clear in a Guinness and Mahon account in the London bank. Six days later, the Guinness and Mahon account was debited with stg£l 82,630 and the GMCT sundry sub company account in Guinness and Mahon in Dublin was credited with the same amount. Just two days before the money reached the GMCT account, the same account was debited with IR£204,055.87 (the IR£ equivalent of the sterling figure), which amount was then credited to an Amiens Investment Limited account in Guinness and Mahon. Approximately two weeks before this lodgement, IR£105,000 had been debited from the Amiens Investments Limited account, in the form of an overdraft, and credited to an ACC loan account in the name of Mr Haughey. Subsequently, amounts of IR£59,000, IR£30,000 and IR£10,000 were withdrawn from the Amiens account in cash or transferred to a Haughey Boland account, which was used to facilitate Mr Haughey’s financial affairs. Thus, a cheque which ordinarily could have been lodged by Mr Traynor in Dublin to a client’s account or accounts, was directed through a London account and two Irish accounts, none of which were in the name of the actual client, before reaching its final destinations. It can be seen from this example that, by deliberately complicating the lodgement and withdrawal system, Ansbacher, through Mr Traynor, made it difficult for anyone to trace the link between the client and their funds. 3.12 Concealment of clients’ identities in statements of account Only very infrequently were statements of account given or sent to clients in relation to their GMCT/Ansbacher accounts. Statements of account were under the control of Mr Traynor and Mr Collery, who arranged for them to be either delivered by hand or posted. The statements were prepared in such a way as not to provide documentary evidence of the existence of the account or identify the location where the money was deposited. In some instances, a hand written account was given, but the document contained no information as to where the funds were deposited. The headings of the bank statements, which had been prepared by Ms Williams, would be removed by Mr Traynor. He would tear off the ‘GMCT’ (and subsequently ‘Ansbacher’) headings with a ruler and give the statements to Ms Williams to arrange delivery to the client. Thus the client would receive a piece of paper that showed the debits and credits and balances in the account similar to a normal bank statement, except for the fact that the name of the bank, the account name and the account reference number had been removed. Mr Traynor told one client that the statements were unheaded for ‘security reasons’. 3.13 Transfer of Ansbacher’s business to 42 Fitzwilliam Square Mr Padraig Collery left Guinness and Mahon in 1989. At the same time, a computer was installed in Mr Traynor’s office, which had been located on the premises of CRH at 42 Fitzwilliam Square Dublin since 1987, for the purpose of keeping the memorandum accounts. Mr Collery visited the office regularly to keep the bookkeeping up to date. Otherwise, everything continued as before, with Mr Traynor receiving lodgements and arranging payments and transfers from the GMCT accounts in Guinness and Mahon (and later, in IIB). The only noticeable change was that gradually the internal memos giving instructions to Guinness and Mahon staff from Mr Traynor became more formal and less like internal instructions, until, during what may be called ‘the IIB period’, all instructions were given formally by letter. 3.14 Transfer of Ansbacher’s business to Winetavern Street After Mr Traynor’s death in May 1994, Mr Furze and Mr Collery removed the computer containing the memorandum accounts from the premises of CRH and brought it to offices belonging to Mr Sam Field-Corbett in Winetavern Street, Dublin. Here Mr Collery continued to operate them on behalf of Ansbacher (as GMCT had by then become.). The memorandum accounts in respect of Ansbacher’s business (as distinct from that of Hamilton Ross) continued to operate until 1996, although the amounts decreased in the latter years. In the latter years, one of Ansbacher’s clients, Mr John Byrne, continued to hold substantial deposits in Ansbacher’s pooled account in IIB and Mr Collery continued faithfully to record transactions on these deposits in the memorandum accounts (see Appendix 111(e)). 3.15 Back-To-Back Loans From a very early date, Guinness and Mahon provided loans to clients of GMCT, both Irish residents and persons not resident in Ireland, backed by the GMCT deposits of those persons. The facility letters sent by Guinness and Mahon to the Irish residents invariably failed to mention the GMCT deposit held as security, although any other form of security was carefully noted. In internal Guinness and Mahon documentation, those loans backed by GMCT deposits were referred to as ‘suitably secured’, as the minutes of a meeting of Guinness and Mahon directors on 20 August 1973 makes clear. Referring to GMCT deposits in Guinness and Mahon, the minutes say: A t present the G.M.C.T. deposits act as security fo r resident loans, which are referred to as “suitably secured”. ’ A former Guinness and Mahon loans officer, Mr Pat O’Dwyer, has told the Inspectors that he always inserted the phrase ‘suitably secured’ or ‘adequately secured’ in loan documentation where the loan was cash-backed. However, it is important to note that the term did not necessarily mean that the deposit was located in the Cayman Islands; the term ‘suitably secured’ (and its variants - ‘adequately secured’, ‘considered adequate’ etc) was used to describe deposits in any Guinness and Mahon subsidiary outside the jurisdiction. Thus, it was used in relation to deposits in Cayman, in the Channel Islands and even in Belfast. The omission of the security from the facility letters and the coy reference to the ‘suitability’ of the security leads one to the inescapable conclusion that Guinness and Mahon wished to keep the existence of the GMCT deposits of Irish residents secret from, among others, the Irish Revenue authorities. This conclusion is reinforced by very different behaviour on Guinness and Mahon’s part where the GMCT client is a non­ resident. In one such case the facility letter, when dealing with the question of security, unambiguously states: ‘In addition, we shall require a Letter o f Guarantee signed by Guinness Mahon Cayman Trust Ltd., supported by a sum equal to the loan hypothecated in our favour. ’ (see Appendix 111(f)). 3.16 Limited information to auditors Mr Traynor personally carried the loan security documents from the Cayman Islands to Ireland once a year, in order for the Guinness and Mahon auditors to inspect them, so that they could satisfy themselves as to the security of the Guinness and Mahon cash-backed loans. However, the auditors were not permitted to take notes of the details contained therein, nor were they permitted to take copies of them. In this way, the details remained secret a n d ‘off the books’ (see extract from a 1978 Central Bank report at Appendix ni(g)). 3.17 Limited information to Central Bank Similarly, Guinness and Mahon furnished the Central Bank in 1976 with copies of security documents relating to the back-to-back loans with Ansbacher, only with the proviso, to which the Central Bank agreed, that they would not take any notes on their contents (see Appendix 111(c)). In its 1978 report on Guinness and Mahon, the Central Bank remarked that the degree of secrecy cloaking the back-to-back loan arrangements was such that no normal banking operation could account for it. The Central Bank concluded that the secrecy surrounding the system existed for purposes of facilitating tax avoidance among their customers, and, in a meeting with Guinness and Mahon the following year, told Guinness and Mahon that this behaviour was not appropriate (see Appendix 111(h)). 3.18 Caveat regarding the ‘suitably secured’ reference Two final points are worthy of note. Firstly, many Ansbacher clients whose loans were described by Guinness and Mahon as being ‘suitably secured’ said on oath, when interviewed by the Inspectors, that they were totally unaware that their offshore funds had been used as security. In most cases, other security also existed, and that security always appeared on the face of the loan documentation. Many of the clients believed that this was the only security. The Inspectors have formed the view that Guinness and Mahon occasionally used the offshore funds of Ansbacher clients as a sort of ‘comfort’, without the clients’ knowledge. Secondly, a number of persons have given evidence to the Inspectors to the effect that they believed the phrase ‘suitably secured’ was occasionally used in cases where there was no cash backing the loan, but where Mr Traynor was so satisfied of the financial standing of the client that he was able to persuade Guinness and Mahon that no security was necessary. 3.19 Concealment of banking operation from Central Bank. The Inspectors have concluded in Chapter 5 that there is evidence tending to show that GMCT engaged in banking activities in Ireland. Nevertheless, it failed to apply at any stage for a banking licence from the Central Bank, as it was required to do. This copperfastened the secrecy by means of which GMCT ensured that the funds of its Irish clients would never come to the attention of any of the relevant Irish authorities. 3.20 Concealment of banking operation from Cayman Authorities Further, Ansbacher failed to seek approval from the Cayman authorities to ‘open outside the Islands a subsidiary, branch, agency or representative office ’, which it was required to do under Section 11 of the Banks and Trust Companies Law since 1989. The only apparent obstacle to their seeking this approval was the removal of the cloak of secrecy that would have resulted. 3.21 Conclusion The Inspectors are satisfied that the policy of secrecy surrounding the memorandum accounts, the contents of the Note to John Furze, the placing of the funds in non-resident accounts in the name of GMCT, the fact that Irish clients were permitted to withdraw sums from these accounts through the medium of Mr Traynor, who issued instructions as a GMCT signatory, and the fact that payments were frequently made in cash to the clients, when taken together constitute evidence tending to show that GMCT and Guinness and Mahon may have conspired together to defraud the Irish Revenue Commissioners. EXTENT OF THE IRISH BUSINESS OF ANSBACHER (CAYMAN) LIMITED INDEX Page 4.1 Introduction 66 4.2 Overall General Business 66 4.3 Dublin Deposits 68 4.4 Audited accounts of GMCT 68 4.5 Hypothecated Deposits 72 4.6 GMCT business relative to Guinness Mahon business 73 4.7 Contribution of GMCT to Guinness and Mahon 75 4.8 The IIB years 77 4.9 Back-to-Back loans and guarantees 78 4.10 Number of clients 78 EXTENT OF THE IRISH BUSINESS OF ANSBACHER (CAYMAN) LIMITED 4.1 Introduction For the purposes of their investigation and having regard to the High Court Order of the 22 September 1999, the Inspectors used the following definition of the Irish business: ‘B usiness which was carried on fo r a ‘Client ’ by the Company in the State or in the case o f a ‘Client ’ who is an Irish Resident i f business was carried on fo r him by the company anywhere in the World. ’ The definition of a ‘Client’ is discussed further in this report in Chapter 22. The Irish business of Ansbacher is described in this Chapter under two headings - firstly, the extent of the corporate business and secondly, the number of clients involved. 4.2 Overall Company Business From a review of its records, Ansbacher has informed the Inspectors that the Company had four distinct areas of operation in the years prior to and including 1988: 1. Business generated from the Americas and the Caribbean. This category represented the bulk of GMCT’s business. 2. Business generated from the UK and Europe, which was only a very small proportion of the total. 3. Business originating from Ireland, whether or not introduced by Mr. Traynor, which by the 1980s, it is claimed, represented a small and declining proportion of GMCT’s business. 4. Poinciana Fund Limited business which was administered by Mr. Traynor and Mr. Furze who transferred most of this business to Hamilton Ross Company Limited in or about September 1988. Mr Traynor made regular visits to Cayman. It was apparently his practice to prepare detailed reports for the Irish management of Guinness and Mahon following these visits. The Inspectors found only a small number of these reports. However, the following figures extracted from his reports of November 1980 and October 1984 give an indication of the level and type of business being conducted globally by GMCT in the late 1970s and early 1980s. Companies and trusts under management (Irish and non-Irish) 31 March 1978 30 April 1979 30 April 1980 31 October 1980 30 April 1982 30 April 1983 30 September 1983 30September 1984 Individual depositors (Irish and non-Irish) Customers ’ deposits (Irish and non-Irish) 143 192 230 250 335 388 420 462 Stg£m 21 29 44 56 116 141 163 204 560 634 685 709 824 896 922 943 In addition, he reported the following staff numbers at 30 September 1984: Total 36 Caymanian 29 Non-Caymanian 7 Ansbacher has informed the Inspectors that in its view ‘GM CT’s Irish sourced business in the mid-1970s accounted fo r no more than 20% o f the total’. In 2001, it has further stated that it ‘is currently administering only a few client relationships which fa ll within the definition o f “Irish business” contained in the Irish High C ourt’s Order o f 22 September 1999, which has been integrated into their other business ’. 4.3 Dublin Deposits From its incorporation until January 1991, GMCT maintained deposits in Dublin with Guinness and Mahon. At that juncture, the deposits were transferred to IIB. In 1997 the deposits were withdrawn. The audited accounts of GMCT show that the Dublin deposits grew from £3.6m in 1972 to almost £56m by 1987. It is tempting to surmise that this should give a good indication of the extent of the Irish business. However, it is important to keep in mind that these figures represent only the assets and liabilities of the Company itself. Any monies controlled by trusts or companies on behalf of Irish customers would not be reflected in the accounts of the Company unless those trusts or offshore companies in turn placed the money back on deposit with GMCT. Even then the monies would not necessarily be deposited in Dublin. For example, the Inspectors have come across instances where money belonging to Irish clients was deposited elsewhere, in particular with Guinness Mahon London. 4.4 Audited accounts of GMCT Copies of the audited accounts of GMCT from March 31, 1971 onwards were available to the Inspectors. These accounts were of particular interest up to 1987 as, taken in conjunction with Guinness and Mahon accounts, certain relevant information can be extracted therefrom. It must be borne in mind that these accounts refer to the overall business of GMCT and not solely the Irish business. Profit and loss accounts Appendix IV(a) summarises the profit and loss accounts available for the period while Graph 1 below illustrates the net profit figures in graphic form. GRAPH 1 GMCT NET PROFITS □ Net profit The main categories of income available to the company were net banking revenue (being the difference between interest earned and interest payable) and management and trust fees. The latter was an extremely important source being almost equivalent to, and in some years greater than, net banking revenue. The figures indicate a sixteen fold increase in net profit between 1972 and 1987 generated by an almost fifty fold increase in total revenue in the same period. The following figures illustrate the position at the beginning, middle and at the end of the period: 1972 1981 1987 STG£000 STG£000 STG£000 Net banking income Other income 16 45 61 607 519 1.126 1,652 1.368 3.020 Net profit 55 483 871 There was a significant increase in profits in the first half of the 1980s followed by an easing back in the mid 1980s. Balance sheets Appendix IV(b) summarises the balance sheets from 1971 through 1987 while graph 2 illustrates the growth in net assets in graphic form. GRAPH 2 GMCT NET ASSETS □ Net assets A similar overall picture emerges to that illustrated by the profit and loss accounts, with the net assets of the company increasing from £10,000 to in excess of £6.6 million over the period. Most striking is the increase in customer deposits (see graph 4 below). These amounted to slightly over £5.6 million in 1972 and had grown to £149 million by 1987. They peaked at over £203 million in 1984. It appears that up until 1975 most were deposited with the Dublin bank. A change occurred in the year to March 1976 when the ratio moved in favour of London (£3 million in Dublin as opposed to £5 million in London). By 1984 the Dublin deposits had dropped to 19% of the London figure. The 1986 and 1987 accounts show a reversal of this trend. By 1987 the Dublin deposits amounted to £56m as against £81m in London (69%). Dublin deposits more than doubled from £25m to £56m in the 3 year period 1984 to 1987. Examples illustrate the position as follows. Customer deposits in GMCT GM Dublin GM London GMCT loans to customers 1975 1981 1984 1987* Stg£000 Stg£000 Stg£000 Stg£000 9.628 5,224 303 3.316 63.833 9,397 34,867 13.126 203.937 25,154 129,888 50.055 149.408 55,964 81,209 14.802 The bulk of the money deposited with the Company by its customers was simply, in turn, deposited by the Company with its parent bank in either London or Dublin. Over time * Note: The figures for loans to customers and customer deposits were shown net of hypothecated amounts after 1984. the proportion of the deposits which were used for normal banking, that is lending to customers, became less important as a proportion of the total business. For example, in 1975 approximately 34% of customer deposits were used to fund customer lending. By 1987, this had fallen to 10%, showing that customer lending had fallen to a very small proportion of its activities. 4.5 Hypothecated Deposits From 1976 to 1983 the Cayman auditors disclosed the hypothecated amounts (i.e. the amounts of the deposits used to secure back-to-back lending) by way of note to the accounts. The accounting policy changed in 1984. From then on the amount of hypothecated funds appears to have been netted off against the figures for both customer deposits and advances to customers and was not disclosed. These figures disclosed, as compared to the Dublin deposits, are as follows: March 31, 1976 March 31, 1977 March 31, 1978 April 30, 1979 April 30, 1980 April 30, 1981 April 30, 1982 Sept 30, 1983 Sept 30, 1984* Hypothecated Funds Dublin Deposits STG £000 STG £000 2,281 2,782 1,449 1,357 2,187 10,631 21,985 34,329 38,759 3,434 2,903 3,331 4,924 7,663 9,397 26,980 30,970 25,154 By 1983, the amounts hypothecated exceeded the Dublin deposits. This shows that the practice of making back-to-back or hypothecated loans was not confined to the Irish business. ' Per Mr Traynor’s management report of 31 October 1984 4.6 GMCT business relative to Guinness and M ahon business Copies of the audited accounts of Guinness and Mahon were available to the Inspectors for the period from 1968 to 1998. Little information is revealed in these accounts with regard to the operations of GMCT or Ansbacher Cayman Ltd. The overall picture is of Guinness and Mahon as a company with a good profit record in the 1970s and early 1980s which experienced severe financial difficulties from the mid 1980s to the mid 1990s. The relationship of GMCT to Guinness and Mahon can be considered in three separate periods. Period to 1983 This was a period of solid profitability and steady growth. Guinness and Mahon was in a position to consistently pay dividends which increased from £39,000 in 1974 to £150,000 in 1983. The most noteworthy feature of this period is the sudden increase in profits in 1982 and 1983. The first mention of GMCT is in the accounts for the year ended April 12, 1971 where it is stated that its contribution to the consolidated profit was £17,322. In 1982 the Guinness and Mahon profits amounted to £1.3m. GMCT’s operating profit for that year was £765,000 so that the group profit of £2m would appear to have been contributed by Guinness and Mahon and GMCT with presumably negligible contributions from the other subsidiaries. For the 17 month period ended September 30, 1983 the roles were reversed. Consolidated profit amounted to £2.6m. Of this GMCT contributed £1.2m while the contribution of Guinness and Mahon was down to £884,000. 1984 to 1988 In September 1984 Guinness and Mahon disposed of a number of its overseas subsidiaries by way of inter company sale to GMOIL, a fellow subsidiary of the London parent. The difficulties experienced by Guinness and Mahon at that time have already been dealt with in Chapter 2. As a result of the inter-company sale the 1984 accounts of Guinness and Mahon recorded a profit of £2.8m. In reality it had made an operating loss of £1.4m in that year. This was turned into profit by an extraordinary profit of £4.2m arising on the sale of the overseas subsidiaries. Graph 3 compares the profits of GMCT, Guinness and Mahon and the Guinness and Mahon group in the critical 1977 to 1986 period. This indicates that GMCT maintained a stable profit record while the results of Guinness and Mahon and its subsidiaries moved into loss in the second half of the 1980s. GRAPH 3 GMCT/GMI/Group profits 1977 to 1986 HGMCT QGMI BGrcup Guinness and Mahon incurred substantial losses in two years out of three from the mid 1980s with only modest profits in every third year or so. The Irish group no longer had the benefit of the contribution of GMCT, which in the meanwhile continued to generate healthy profits of about three quarters of a million pounds per annum. This was therefore a period of considerable change for Guinness and Mahon. Among the changes were: • the resignation of several directors including Mr Traynor on May 2, 1996; • the replacement of Messrs Touche Ross as auditors by Messrs Coopers & Lybrand; • the ongoing losses required substantial injections of capital. The share capital of the company increased from £lm in 1986 in stages to £7.3m by 1993. At the same time the share premium account increased from £50,000 to £3.9m; • the 1988 accounts record redundancy payments of £1.6m in addition to the bad debt reserve of £5m; 1988 onwards As described in Chapter 2, Chichester Investments Limited, owned by Messrs Traynor, Furze, Collins and Hart, purchased GMCT from GMOIL in 1988 and, within months, sold a majority stake in it to Ansbacher. This had implications for Guinness and Mahon. The deposits, which had previously been placed by a fellow Guinness and Mahon group member were now third party deposits. This must have been viewed with some concern by Guinness and Mahon management as the GMCT or Ansbacher deposits represented some 35% of its deposit base at that time. The agreement for the sale of GMCT to Chichester Investments Limited preserved the level of London deposits on a reducing basis up to September 1990. As a matter of practice, the Irish deposits also followed this pattern. 4.7 Contribution of GMCT to Guinness and Mahon The Inspectors considered the importance of GMCT as a contributor to the assets and profits of the Irish group. The concern that arose at the time of the sale of the Company to Ansbacher was a clear reflection of the fact that Guinness and Mahon management was fully conscious of the importance of this business as a contributor to Guinness and Mahon profits. Graph 4 shows the total customer deposits as revealed in the balance sheets of GMCT and Guinness and Mahon. It is noteworthy that from 1982 onwards GMCT had a higher level of customer deposits than Guinness and Mahon peaking at over £200m in 1984.* Graph 4 GMCT Customer Deposits v GMI Customer Deposits 250.000.000 200.000.000 150.000.000 -i 100.000.000 — 50,000,000 0 =n J] n0. eQ [£l d] L [ ____ 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 □ GMCT "G M I Graph 5 illustrates the relationship between the GMCT balances at Guinness and Mahon (the Dublin deposits) and the total of customers current and deposit accounts appearing in the Guinness and Mahon balance sheet. Guinness and Mahon customer deposits grew from £25m in 1973 to £100m in 1984, while the GMCT deposits with Guinness and Mahon ranged from £5.5m to £21.3m peaking at £32.7m in 1982. Thus the GMCT deposits were an important feature of the Guinness and Mahon balance sheet. Typically they amounted to between 10% and 20% of non-group customer deposits but peaked at ' GMCT was no longer a subsidiary of Guinness and Mahon after 1984 40% in 1982. As mentioned above, the deposits were said to have amounted to some 35% of non-group deposits by the time of the sale of GMCT to Ansbacher in 1988. GRAPH 5 GMCT bala n ces v G Ml c u rre n t & d e p o s it a cc o u n ts . '20 i 100 80 60 40 20 0 TidhriHhl 1973 1974 1975 1976 1977 1978 ill 1979 1981 1982 1983 □ G M C T balance ■ C u rre n t & deposit accounts 4.8 T h e IIB years KB has informed the Inspectors that that some £96m passed through the Ansbacher/ Hamilton Ross accounts with IIB during the period 1991 to 1997. In addition, IIB provided the following year end deposit balances for both Ansbacher and Hamilton Ross: 31 December: 1991 1992 1993 1994 1995 1996 1997 Ansbacher IR£ Hamilton Ross IR£ 21,343,476 11,735,959 9,777,211 5,921,746 2,438,546 1,669,575 1,596,124 11,621,708 11,347,444 11,007,911 9,627,439 13,873,788 585,309 Total IR£ 21,343,476 23,357,667 21,124,655 16,929,657 12,065,985 15,543,363 2,181,433 4.9 Back-to-back loans and guarantees In the case of KB, formal hypothecation of Cayman deposits occurred in respect of both loans and guarantees given by IIB on behalf of Cayman. For the years 1991 to 1997 the amounts were approximately: Sterling £ 1991 1992 1993 1994 1995 1996 1997 4.10 9.7m 16.2m 19.01m 20.7m 22.1m 3.9m 2.7m Number of clients The Order of the Grand Court of Cayman made on 24 May 2001 precluded Ansbacher from identifying to the Inspectors its clients. However, the Company was in a position to furnish the Inspectors with certain information regarding the number of clients as opposed to the identity of the clients. The Inspectors had furnished to the Company a list of persons in respect of whom the Inspectors had some information indicating that they might be clients of the Company. Ansbacher was able to indicate to the Inspectors that there were only 28 clients known to the Company who did not appear on the list furnished by the Inspectors. In addition, the Company indicated that an unidentified number of persons appearing on the list were not in fact clients of the Company. Since receipt of that information, the Inspectors have refined further their list of clients by excluding certain persons in respect of whom there was insufficient evidence to conclude that they were a client. The Inspectors also excluded the names of corporate entities used by clients as a vehicle for their investments, except in the small number of cases where the principals of such entities were not known. In addition, they have concluded that another 25 persons (additional to the persons appearing on their list forwarded to the Company) were or are clients. If one assumes that the Inspectors have not mistakenly excluded any person from their original list, then it might appear reasonable to conclude that the Inspectors have identified all but three of the clients of the Company. However, some allowance must be made for frailties in record-keeping and research. Accordingly, while the Inspectors are satisfied that they have identified the vast majority of the clients, they cannot report with certainty that only three clients remain unidentified. The Inspectors have identified a total of 190 clients. THE WRONGDOING OF ANSBACHER (CAYMAN) LIMITED INDEX Introduction 82 Conducting its affairs with intent to defraud a creditor of some of its clients 82 Criminal Offences 83 Breaches of the Companies Acts 83 Unlicensed banking 85 Breaches of the taxation code 89 Taxation on Irish profits 89 Return to the Revenue Commissioners 91 Taxation on Illegal Trading Activities 93 Withholding tax on interest 93 Reporting of interest 94 80 5.12 Deposit Interest Retention Tax (DIRT) 95 5.13 Operation of PAYE 95 5.14 Breaches of Cayman law 97 THE WRONGDOING OF ANSBACHER (CAYMAN) LIMITED 5.1 Introduction As appears from the Order of 22 September 1999 appointing the Inspectors, they are required, at paragraph 2: ‘(c) to examine whether the Companies Acts 1963-1990 were breached by the Company..... and i f so to identify the provisions involved..... ’ and ‘(d) to examine whether the affairs o f the Company were conducted with intent to defraud its creditors or the creditors o f any other person or otherwise fo r fraudulent or unlawful purpose and i f so to identify the statutory provisions involved..... ’ The Inspectors considered it relevant also to examine whether or not there was evidence tending to show that Ansbacher carried on an unlicensed banking business, was in breach of the Taxation Code or breached certain aspects of Cayman law. 5.2 Conducting its affairs with intent to defraud a creditor of some of its clients As has been set out in the preceding chapters of this report the Inspectors are satisfied that, in the course of conducting its Irish business, Ansbacher provided a range of services to clients which were calculated to facilitate those clients in the evasion of their taxation liabilities. The Inspectors are satisfied that there is evidence tending to show that some of the clients of Ansbacher availed of its services for that purpose and did so with Ansbacher’s knowledge. So far as sub-paragraph (d) of the Order is concerned the Inspectors are satisfied therefore that there is evidence tending to show that the affairs of Ansbacher were conducted with intent to defraud a creditor of some of its clients, namely the Revenue authorities. 5.3 Criminal Offences The conclusion that there is evidence tending to show that Ansbacher conducted its affairs with intent to defraud a creditor of some of its clients leads the Inspectors to conclude that there is also evidence tending to show that Ansbacher was guilty of a number of criminal offences including: (a) The common law offence of conspiracy (with, inter alia, some of its clients) to defraud, which is an offence punishable by a fine or imprisonment; and (b) The offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the provisions of the appropriate tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act 1997. 5.4 Breaches of the Companies Acts The Inspectors are also required to consider whether Ansbacher has breached any of the provisions of the Companies Act 1963-1990. In this context, it is important to bear in mind that Ansbacher is a company incorporated outside the State and relatively few of the provisions of the Companies Acts therefore apply to it. However, Part XI of the Companies Act 1963 (‘1963 Act’) applies specifically to companies incorporated outside the State that have an established place of business within the State. The Inspectors are satisfied that Ansbacher had established places of business within the State, being at first the premises of Guinness and Mahon and later the premises of CRH pic and accordingly, Part XT of the 1963 Act applies to Ansbacher. The principal purpose of the provisions contained in the 1963 Act is to ensure that some basic information is available in Ireland in relation to companies incorporated outside the State but doing business in Ireland. Thus, Section 352 requires such a company, within one month of the establishment of a place of business within the State, to deliver to the Registrar of Companies certain basic information including: (a) A certified copy of its constitutional documents (e.g. the Memorandum and Articles of Association) and, if applicable, a certified translation thereof; (b) Particulars of its directors and secretary; (c) The names and addresses of persons resident in the State who are authorised to accept service of process notices and the like on behalf of the company; (d) The address of the company’s principal place of business in the State; (e) Any changes in all or any of the aforementioned documents and particulars. By Section 353, the company is obliged, if there is any alteration in any of the foregoing, to deliver a return to the Registrar of Companies containing the prescribed particulars of the alteration. Pursuant to Section 355, Ansbacher was obliged to exhibit conspicuously on every place where it carried on business in the State the name of the company and the country in which it is incorporated. By Section 357, Ansbacher, if it ceased to do business in the State (which it did not do earlier than 1995) was obliged to forthwith give notice of the fact to the Registrar of Companies. It was of the essence of Ansbacher’s Irish business that it should be conducted in secret. The Inspectors have detailed elsewhere the lengths to which Mr Traynor went to conceal, even in statements of account given to clients, the fact that Ansbacher was doing business in Ireland. It comes as no surprise therefore to find, as the Inspectors do, that Ansbacher breached each and every one of the provisions referred to above. Such breaches cannot be described as inadvertent, given that it was a conscious decision of Ansbacher’s to conduct its business in a secret fashion. By Section 358 of the Act of 1963, it is provided that if any company fails to comply with any of the provisions of Part XI of the Act, the company and every officer or agent of the company who knowingly and wilfully authorises or permits the default is liable to a fine not exceeding £500. The Inspectors are satisfied that Ansbacher has failed to comply with each of the foregoing provisions.1 5.5 Unlicensed banking The business of banking in Ireland is regulated, inter alia, by the provisions of the Central Bank Act 1971 (as amended) and the Central Bank Act 1989. It is necessary to know something of the provisions of these Acts before being in a position to address the question of unlicensed banking. Section 2 of the Act of 1971 defines banking business as meaning business that consists of: ‘(a) the business o f accepting deposits payable on demand or on notice or at a fixed or determinable future date, but excluding deposits with a trader from persons employed by him in his trading business or from his customers in the normal course o f his trading business and deposits or instalments in respect o f the letting or selling o f goods under a Hire Purchase Agreement or a Credit Sale Agreement, or The Inspectors have considered also the extent to which Ansbacher might be said to have breached the provisions of the European Communities (Branch Disclosure) Regulations of 1993,which came into force in the State on 1 February 1994. The disclosure requirements contained in the Regulations are similar to those contained in Part XI of the 1963 Act save that they apply to companies having a branch in the State as opposed to an established place of business. Given the overlap between the two provisions and given the fact that the conduct of business by Ansbacher in Ireland ceased in or about 1995 the Inspectors have not considered further the provisions of these Regulations. (b) the business aforesaid and any other business normally carried on by a bank, ’ Section 29 of the Central Bank Act 1989 replaced the definition of banking business contained in Section 2 of the Central Bank Act 1971 with a more detailed definition, the text of which is set out in the footnote below.2 However, for present purposes it does not materially alter the matters under consideration. Section 7 of the 1971 Act provides (in so far as is relevant) that a person shall not on his own behalf or on behalf of any other person in or outside the State carry on banking business or hold himself out or represent himself as a banker or as carrying on banking business unless - ‘(a) he is a holder o f a licence, and (b) he maintains a deposit in the Central Bank o f an amount determined in accordance with the provisions o f the Act. ’ Section 2 of the Act of 1971 is hereby amended ‘...'banking business’ means business which consists of (a) the business of accepting deposits payable on demand or on notice or at a fixed or determinable future date, or (b) the business of taking funds, other than deposits, from the public payable on demand or on notice or at a fixed or determinable future date (whether or not involving the issue of securities or other obligations, however described), but excluding (i) deposits with a trader from persons employed by him in his trading business or from his customers in the normal course of his trading business and deposits or instalments in respect of the letting or selling of goods under a Hire Purchase Agreement or a Credit Sale Agreement, or (ii) the taking of other funds by persons from the public where it can be shown that (I) no part of the business activities of the persons so taking or of any other person who is financed wholly or substantially out of those funds, and (II) such funds are, in the normal course of business, taken on a casual or incidental basis only, or (III) monies taken solely as a premium in respect of the issue or renewal of a Life Assurance Policy issued by a holder of an authorisation under the European Communities (Life Assurance) Regulations, 1984 (S. I. No. 57 of 1984), or either or both of the businesses aforesaid and any other business normally carried on by a bank and 'banking’ and words cognate thereto shall be construed accordingly;’ Subsection 2 of Section 7, in so far as is relevant, deems a person to hold himself out as a banker: ‘(a) if, being a body corporate carrying on any business, the name o f the body includes any o f the words bank’, banker’ or banking’ or any word which is a variant, derivative or translation o f or is analogous to any o f those words or..... (d) in any case, i f by the use, in an advertisement, circular, business card or other document, o f any o f the words bank ’, banker ’ or banking ’ or any word which is a variant, derivative or translation o f any o f those words or any word or phrase analogous thereto, he holds himself out or represents him self as conducting or being willing to conduct banking business. ’ Section 58 of the Act of 1971 provided that any person who contravened Section 7 of the Act should be guilty of an offence and should be liable on summary conviction to a fine not exceeding £100 or on conviction on indictment to a fine not exceeding £5,000. A continued contravention of Section 7 after conviction rendered the person liable to a further conviction on indictment and to a fine not exceeding £250 for each day on which the contravention was continued. These penalties were increased significantly by Section 9 of the Central Bank Act 1989 so that, for example, a conviction on indictment exposed the person convicted to a fine not exceeding £50,000 or to a term of imprisonment not exceeding five years or to both. The Inspectors are satisfied that there is evidence tending to show that Ansbacher carried on banking business in Ireland. In particular: (a) Irish clients were able to lodge and withdraw the funds in their Ansbacher accounts in Ireland. Up to 1988, these transactions were carried out in Guinness and Mahon and after that date, principally on the premises of CRH. Occasionally, Mr Traynor would meet people by arrangement to conduct their transactions, or money would be delivered to their homes by Mr Traynor’s driver or by the CRH porter. A number of persons have given evidence to the Inspectors that they made lodgements on the premises of CRH. (b) Transactions in relation to Ansbacher funds of Irish clients were entered on a computer on the premises of Guinness and Mahon (and later on the premises of CRH) weeks before similar entries were made in Cayman. To quote the internal audit report of Guinness and Mahon of February 1989, Mr Padraig Collery acted in practice as ‘the Dublin based agent o f Ansbacher. ’ The report went on to state: A ll transactions relating to [the] deposits are initiated and processed by [Mr Collery]. In addition to negotiating with both parties to the transactions, he raises accounting entries and prepares input vouchers, deals slips etc. fo r both the parties (Guinness and Mahon Limited).... and the customers o f Ansbacher [Mr Collery] together with certain agent[s] o f the customers negotiates not only interest payable on the Customer Deposits but also interest payable on the Ansbacher Deposits. ’ Furthermore, there is evidence that Ansbacher held itself out as carrying on banking business. Between November 1992 and September 1994, it was registered as ‘Cayman International Bank and Trust Company Limited’. Letters emanating from 42 Fitzwilliam Square were on headed paper bearing this name and requesting that, where appropriate, replies be directed to 42 Fitzwilliam Square. Similarly, the ‘Ansbacher Limited’ headed notepaper used by Mr Traynor throughout most of 1991 carried the legend ‘A Member of the Henry Ansbacher Holdings Pic Merchant Banking Group’. By these communications, Ansbacher held itself out as being engaged in the business of banking. Ansbacher did not have the licence required by Section 7 of the Central Bank Act 1971 (as amended) to carry on the business of banking in Ireland or to hold itself out as carrying on such a business. Indeed, it did not even apply for such a licence (see Appendix V(a)). The Inspectors are therefore satisfied that there is evidence tending to show the commission of a criminal offence. 5.6 Breaches of the taxation code The question of whether there is evidence tending to show that Ansbacher was in breach of the taxation code has been referred to in this Report in general terms. It is dealt with here in some detail. 5.7 Taxation on Irish profits Certain taxation consequences follow from a finding that Ansbacher had established a place of business in the State. In short, the Irish branch of a non-resident company carrying on business in the State is subject to Irish tax as if it (the branch) were resident in the State. Ansbacher was formed in 1971 and accordingly part of its commercial activities would pre-date the coming into force of the Corporation Tax Act, 1976. At that time, the primary tax legislation dealing with the activities of foreign persons carrying on business in the State was contained in Chapter II of Part IX of the Income Tax Act 1967. However, as the preponderance of Ansbacher’s activities related to the period after the 1976 Act came into force and its import is the same as the legislation that pre-dated it, the following comments are made in the context of the 1976 Act. The provisions of the Corporation Tax Act 1976 have since been incorporated into the Taxes Consolidation Act 1997. Section 1(5) of the Corporation Tax Act 1976 provides that the term ‘company’ for the purposes of corporation tax means any body corporate. Thus, it includes a company registered abroad. Section 6(1) of the Act then goes on to provide as follows: ‘Subject to any exceptions provided fo r in this Act, a company shall be subject to corporation tax on all o f its profits wherever arising. ’ This suggests that foreign companies could be subject to Irish corporation tax notwithstanding the fact that such companies might have no connection whatsoever with Ireland. However, the ostensibly wide remit of Section 6(1) is restricted by Section 8 which provides as follows: ‘(1) A company not resident in the State shall not be within the charge to corporation tax unless it carries on a trade in the State through a branch or agency but, i f it does so, it shall, subject to any exceptions provided fo r by this Act, be chargeable to corporation tax on all its chargeable profits wherever arising. (2) For purposes o f corporation tax the chargeable profits o f a company not resident in the State but carrying on a trade there through a branch or agency shall be— (a) any trading income arising directly or indirectly through or from the branch or agency, and any income from property or rights used by, or held by or for, the branch or agency (but so that this, paragraph shall not include distributions received from companies resident in the State); and (b) such chargeable gains as, but fo r this Act would be chargeable to capital gains tax in the case o f a company which is not resident in the State: Provided that such chargeable profits shall not include chargeable gains accruing to the company on the disposal o f assets which, at or before the time when the chargeable gains accrued, were not used in or fo r the purposes o f the trade and were not used or held or acquired fo r the purposes o f the branch or agency. ’ The effect is that a non-resident company is liable to corporation tax only on the profits and gains attributable to its Irish branch. The Inspectors are satisfied that Ansbacher carried on business in the State through a branch or agency in that they have concluded that Ansbacher had an established place of business within the State. The consequence is that the profits of such branch were liable to corporation tax and the appropriate tax returns and payments should have been made to the Revenue Commissioners. 5.8 Returns to the Revenue Commissioners Prior to the introduction of self-assessment the onus for taking the initiative in relation to the obtaining returns and the assessment of taxes rested with the Inspector of Taxes. For example, Section 169 of the Income Tax Act 1967 provided: ‘E very person chargeable under this Act, when required to do so by any general or particular notice given in pursuance o f this Act, shall, within the period limited by such notice, prepare and deliver to the inspector, a statement in writing as required by this Act, signed by him, containing— ................. ( b ) the amount o f the profits or gains arising to him, from each and every source chargeable according to the respective schedules, estimated fo r the period and according to the provisions o f this Act. ’ Similarly Section 143 of the Corporation Tax Act 1976 provided: A company may be required by a notice served on it by an inspector or other officer o f the Revenue Commissioners to deliver to the officer within the time limited by the notice a return o f the profits o f the company computed in accordance with this Act. ’ However, the onus did not rest solely with the Revenue. The tax legislation contains provisions which oblige taxpayers who have a liability to taxation to so inform the Inspector of Taxes. The purpose, of course is to enable the inspector to request the relevant returns and make the appropriate assessments. Section 5 of the Finance (Miscellaneous Provisions) Act 1968 (now section 876 Taxes Consolidation Act 1997) provided that: ‘E very person who is chargeable to income tax fo r any year o f assessment and who, in relation to that year, has not been given a notice under section 169 or section 172 o f the Income Tax Act, 1967, and has not made a return o f his total income, shall, not later than one year after the end o f the year o f assessment, give notice to the inspector o f taxes that he is so chargeable. ’ Section 142 of the Corporation Tax Act 1976 applied to companies for this purpose from April 1976 onwards: ‘(1). Every company which is chargeable to corporation tax fo r any accounting period and which has not made a return o f its profits fo r that accounting period shall, not later than one year after the end o f that accounting period, give notice to the inspector that it is so chargeable: Provided that this subsection shall not impose a duty to give any notice before the 6th day o f April, 1976. (2) Where a company fails to give a notice which it is required to give under this section— a. the company shall be liable to a penalty o f £500 and, i f the failure continues after judgement has been given by the court before which proceedings fo r the penalty have been commenced, to a further penalty o f £50 fo r each day on which the failure so continues, and b. the secretary o f the company shall be liable to a separate penalty o f £ 100 . ’ Following the introduction of self-assessment it became mandatory, under Section 10 of the Finance Act 1988, to make a return without being required to do so by an Inspector of Taxes. Apart from the penalties recited in section 142 of the Corporation Tax Act 1976, Sections 500 and 503 of the Income Tax Act 1967 (now Sections 1052 and 1054 Taxes Consolidation Act 1997) imposed penalties for failure to make a return. Prior to the introduction of self-assessment these penalties could be incurred only if the failure occurred after an Inspector of Taxes had requested a return. Following the introduction of self-assessment, failure to make the relevant mandatory returns incurs the relevant penalties. 5.9 Taxation of Illegal Trading Activities The Inspectors have concluded that there is evidence tending to show the commission of a criminal offence by the Company in that it carried on an unlicensed banking business in the State. Prior to the enactment of Section 19 of the Finance Act 1983 (now Section 58 Taxes Consolidation Act 1997), the profits from an illegal trade were not assessable to tax. That section brought such profits within the charge to tax. It applies to assessments made on or after 8 June 1983. 5.10 Withholding tax on interest Section 31 of the Finance Act 1974 imposed an obligation on certain persons to withhold income tax when paying interest and to account for that tax to the Revenue Commissioners. This legislation remains in force and is now contained in Section 246 Taxes Consolidation Act 1997. However, it was superseded, in the case of banks, by the introduction of DIRT in 1986. In summary, the legislation imposes an obligation to withhold income tax at the standard rate on payments of interest by: • A company • Any person paying interest to a non-resident. It provides an exemption in the case of interest paid by a bank in the ordinary course of carrying on a bona fide banking business in the State. The inspectors are satisfied that there is substantial evidence that Ansbacher carried on a banking business in the State. However, they are not satisfied that this was a bona fide banking business on the grounds that it was not licensed. Therefore Ansbacher had an obligation to withhold income tax at the standard rate on payment in the State of interest to its customers and should have accounted to the Revenue Commissioners for this taxation. 5.11 Reporting of interest Section 175 of the Income Tax Act 1967 (now Section 891 of the Taxes Consolidation Act 1997) imposes a requirement to report to the Revenue Commissioners all payments of interest which were made without deduction of withholding tax. This requirement applies in the case of every person carrying on a trade in the course of which interest amounting to £50 or more per annum is paid (£70 in the period 1968 to 1982). It did not apply where the owner of the interest made a declaration of non-residence to the person paying the interest. This requirement was primarily aimed at bona fide banks which were permitted to pay interest gross. It has been concluded above that Ansbacher had an obligation to withhold tax when paying interest. Consequently these reporting obligations would not apply to it. 5.12 Deposit Interest Retention Tax (DIRT) The Finance Act 1986 introduced DIRT with effect from 6 April 1986. The two major effects of this were: 1. It removed the exemption from withholding tax on interest paid by banks. 2. It removed the requirement for banks to report interest payments to the Revenue as such interest was not longer paid gross. The obligation to withhold DIRT and account for it to the Revenue Commissioners rests only with ‘relevant deposit takers’. These were defined in Section 31 of the Finance Act 1986 as follows: ‘(a) a person who is a holder o f a licence granted under section 9 o f the Central Bank. Act, 1971, (b) a building society, (c) a trustee savings bank, within the meaning o f the Trustee Savings Banks Acts, 1863 to 1979, (d) the Agricultural Credit Corporation, p. I. c., (e) the Industrial Credit Corporation, p. I. c., and the (f) Post Office Savings Bank ’ As Ansbacher did not hold a licence under Section 9 of the Central Bank Act 1971 (although it ought to have done), and did not fall within any of the other categories of ‘relevant deposit taker’, the obligation to withhold DIRT would not have applied to it. As a result of its failure to obtain a licence, it instead had the obligation to withhold tax under Section 31 of the Finance Act 1974. It failed in this obligation. 5.13 Operation of PAYE Employers are obliged to withhold income tax, pay related social insurance contributions and levies etc on making payments of emoluments to employees (Section 126 Income Tax Act 1967 - now Section 985 Taxes Consolidation Act 1997). These regulations apply only when the relevant emoluments are assessable to income tax under Schedule E. Broadly three conditions must be present before emoluments are assessable under Schedule E: 1. There must be a contract of service ie the relationship between the parties must be that of employer/employee 2. The contract of employment must be entered into in the State 3. The payment of the emoluments is made in the State If the contract is not one of service but rather for services, the recipient is regarded as self employed and subject to tax under Schedule D Case I or II. The ‘employer’ in such cases has no obligation to withhold tax but the ‘employee’ is obliged to make his or her own returns and pay any resultant tax liabilities. If the contract is one of employment but is made outside the State it is regarded as a foreign possession and assessable under Schedule D Case HI even though the duties of the employment may be performed in the State. Again the employer in such cases has no obligation to withhold tax but the employee is obliged to make his or her own returns and pay any resultant tax liabilities As PAYE withholding arises at the point of payment, it does not apply where the pay point is outside the State as Irish taxes cannot be imposed outside the jurisdiction of the State. The Inspectors have found that Ansbacher retained the services of three individuals and made regular payments of remuneration to them. The individuals involved were Messrs Desmond Traynor, Padraig Collery and Ms Joan Williams. Their duties are described elsewhere in the report. The payments of remuneration were effected within the State by crediting the memorandum accounts of the individuals in the Dublin books. The same arrangements were continued by Hamilton Ross. The Inspectors are satisfied that the relationship between Messrs Traynor, Collery and Ms Williams on the one hand and Ansbacher and Hamilton Ross on the other was one of employer/employee. In the view of the Inspectors, these arrangements constituted employment contracts entered into in the State, the remuneration in respect of which was paid in the State and consequently was assessable under Schedule E. PAYE was not operated. The result is that the employer in each case was in default under the PAYE regulations. Having regard to the above, the Inspectors have concluded that there is evidence tending to show that Ansbacher: (a) Breached Section 5 of the Finance (Miscellaneous Provisions) Act 1968 by failing to deliver to the Revenue Commissioners a statement in writing containing the particulars therein set out; (b) Breached Section 141 of the Corporation Tax Act 1976 by failing to deliver to the Revenue Commissioners a statement in writing containing the particulars therein set out; (c) Breached Section 142 of the Corporation Tax Act 1976 by failing to deliver to the Revenue Commissioners a Notice of Liability to Corporation Tax; (d) Failed to pay Corporation Tax lawfully due; (e) Breached Section 31 of the Finance Act 1974 in respect of the obligation to deduct tax from interest payments; and (f) Failed to make deductions from payments to employees (Mr Traynor, Ms Williams and Mr Collery) contrary to Section 126 of the Income Tax Act 1967 (now Section 985 of the Taxes Consolidation Act 1997). 5.14 Breaches of Cayman law Section 10(a) of the Cayman Islands Banks and Trust Companies Law (as amended) provides as follows: A licensee incorporated under the Companies Law (2001 Second Revision) shall not, without the prior written approval o f the Authority- (a) open outside the Islands a subsidiary, branch, agency or representative office; ’ A provision in identical terms has been in force in the Cayman Islands since 1989. The information available to the Inspectors indicates that had Ansbacher applied for such a permission it would almost certainly have been granted. To do so however would have run counter to its policy of secrecy and concealment in relation to its Irish business. It did not apply for such permission and the absence of such permission, there is evidence tending to show that it acted in breach of the laws of the Cayman Islands. PART RESPONSIBILITY FOR THE WRONGDOING OF ANSBACHER (CAYMAN) LIMITED 99 RESPONSIBILITY - OFFICERS AND AGENTS INDEX Page 6.1 Introducti on 101 6.2 The officers of Ansbacher 102 6.3 Mr James Desmond Traynor (1971-1994) 102 6.4 Mr John Anthony Collins (1971-2000) 103 6.5 Mr John Andrew Furze (1971-1995) 103 6.6 Mr Hugh Cecil Hart (1980 to February 2002) 103 6.7 The agents of Ansbacher 104 6.8 Mr Padraig Collery 104 6.9 Ms Joan Williams 104 6.10 Particular responsibility of certain individuals 105 RESPONSIBILITY - OFFICERS AND AGENTS 6.1 Introduction Up to this point in the report, the Inspectors have outlined the history of Ansbacher, described the services it provided and considered the evidence tending to show that certain wrongs were committed. The Order of 22 September 1999 appointing the Inspectors required, at paragraph 2(b), that they investigate and report on the affairs of the company, and in particular: ‘to identify as fa r as possible all o f the parties who were either officers (including shadow directors) and agents o f the Company, clients o f the Company or who otherwise assisted in the carrying out o f the business at the relevant time; ’ As described in Chapter 2, Ansbacher underwent a number of changes of ownership during its lifetime. It was originally a wholly owned subsidiary of Guinness and Mahon, and was sold in 1984 to another member of the Guinness Mahon Group, Guinness Mahon Overseas Investments Limited. Following a brief period during which it was owned by Mr Traynor and his colleagues, it was purchased by the Henry Ansbacher Group and the company’s name was changed again to Ansbacher Limited. It was later acquired by the First National Bank of Southern Africa, and became known as Ansbacher (Cayman) Limited. In 1998, the company became a subsidiary of First Rand Limited through that group’s acquisition of First National Bank of Southern Africa Limited. In this Part of the Report, the Inspectors identify the officers and agents of Ansbacher, consider the responsibility of certain of them, consider the roles and responsibilities of each of the owners of Ansbacher (with the exception of FirstRand, as the Irish business of Ansbacher had ceased by 1998) and examine the extent to which they may have to accept responsibility for its wrongdoing, if at all. 6.2 The officers of Ansbacher Section 2(1) of the Companies Act, 1963 defines an officer as ‘including a director or secretary’. Officers of a company are responsible for the company’s actions. Clearly, however, there are degrees of responsibility related to the roles played in the company. A non-executive director cannot be said to be as knowledgeable about day-to-day company activities as an executive director. A financial director will be expected to have a much better understanding of the financial issues in a company than a director involved in a non-financial role. A managing director or executive chairman, especially if his or her role involves the strategic development of the company, will bear a significant responsibility for the actions of a company. So it was with Ansbacher, where individual directors played a greater or lesser part in its development and day-to-day management. A list of the directors and company secretaries of Ansbacher from its incorporation in 1971 as Guinness Mahon Cayman Trust Limited is set out in Appendix VI(a). Many of the persons named on the list acted for varying periods of time, mostly short, as non­ executive directors. Some, such as Messrs Bryan Bothwell and Fraser Jennings who acted as executive directors from the early 1990s, appear to have played little if any part in the Irish business. Those who did play an influential role in the Irish business of Ansbacher, or a significant role over a lengthy period in the life of the company, were: 6.3 Mr James Desmond Traynor (1971- 1994) Mr. Traynor was one of the founders of GMCT, together with John Collins and the late John Furze. For many years until his death, he was the Chairman of GMCT and Ansbacher, and, although described as a non-executive director, carried out executive functions in Ireland, where he was its principal representative. 6.4 Mr John Anthony Collins (1971 - 2000) Mr John Collins was an employee of the Bank of Nova Scotia, which administered GMCT from 1971 to 1973. He was appointed a director of GMCT by his employer. He left the Bank of Nova Scotia in 1973 to take up duties as an executive director of GMCT. He was mainly responsible for the American and Jamaican clients of the company. He is the only surviving member of the founding group of GMCT, and he gave evidence on oath to the Inspectors. The transcript of Mr Collins’s evidence is attached at Appendix VI(b). 6.5 Mr John Andrew Furze (1971 - 1995) Mr John Furze was also formerly employed by the Bank of Nova Scotia, and was appointed a director of GMCT at the same time as M r Collins. He too left the Bank of Nova Scotia in 1973 to become an executive director of GMCT. He, together with Mr Traynor, was responsible for the management of the affairs of the Irish clients of the company. 6.6 Mr Hugh Cecil Hart (1980 to February 2002) Mr Hugh Hart was a practising lawyer based in Jamaica who appears to have generated business for GMCT within the Caribbean from early in the life of the company. In 1980, he became a non-executive director, which role he retains to the present day. In 1988, he was the prime negotiator on behalf of the management team in the acquisition of the company from the Guinness Mahon Group. Along with the management team of Messrs Traynor, Collins and Furze, he personally took up a share in the equity at that time. Mr Harte appears to have been a very important source of business for the Company, particularly business from the US and the Caribbean. There is no evidence, however, to indicate that he GMCT/Ansbacher. had any significant connection with the Irish business of 6.7 The agents of Ansbacher An agent is a person who has authority to carry out acts affecting the legal position of another person, termed the principal. When an agent acts on behalf of his principal, the law treats the act as being that of the principal himself, and renders the principal liable for it. In the opinion of the Inspectors, the following persons were agents of Ansbacher: 6.8 Mr Padraig Collery Mr Padraig Collery assisted M r Traynor in the operation of Ansbacher’s Irish business. He has had a lengthy career in banking, commencing with his first employment in Lloyds Bank in London in 1968. From 1974 to 1989, he was a senior official in Guinness and Mahon with responsibility for accounts and computer operations. In 1976, he succeeded Mr Ru Leonard in the maintenance of the so-called ‘memorandum accounts’. When Mr Traynor left Guinness and Mahon in 1986, M r Collery continued to operate the memorandum accounts. An internal audit report on Guinness and Mahon commissioned by its parent Guinness Mahon London in 1989 states, referring to M r Collery: ‘I n practice (but not officially) therefore, DPC acts as a Dublin-based agent o f Ansbacher Lim ited insofar as the management o f Customer and Ansbacher Deposits is concerned ... ’ Following Mr Traynor’s death in 1994, M r Collery effectively replaced him as Ansbacher’s representative in Ireland. He took on this task at the specific request of Mr Furze. This task continued with the management of the memorandum accounts in respect of clients of Hamilton Ross up to the late 1990s. 6.9 Ms Joan Williams Ms Joan Williams was M r Traynor’s personal secretary from 1972 until his death, and she worked very closely with him both in Guinness and Mahon and in CRH. Ms Williams acted as signatory on bank accounts used in the Ansbacher process, such as the Kentford Securities account. Ms W illiams’s working relationship with M r Traynor, on whose instructions she acted, gave her a good view of the nature of the Irish business. After M r Traynor’s death, Ms Williams facilitated the transfer of the Ansbacher and Hamilton Ross business to the control of M r Collery. 6.10 Particular responsibility of certain individuals The Inspectors have concluded that the late M r Traynor, the late Mr Furze and Mr Collins have a particular responsibility to bear in respect of the wrongdoing of Ansbacher. The Inspectors’ reasons for so concluding are set out in the following chapters of this Part of the Report. RESPONSIBILITY OF MR DESMOND TRAYNOR INDEX Page 7.1 Introducti on 108 7.2 Mr Traynor’s role in Guinness and Mahon 108 7.3 Mr Traynor as a director of Guinness Mahon London 109 7.4 Mr Traynor’s role in GMCT 110 7.5 Mr Traynor’s role after his resignation from Guinness and Mahon 111 7.6 Mr Traynor’s Ansbacher role at 42 Fitzwilliam Square 112 7.7 Mr Traynor’s role in GMCT while employed by Guinness and Mahon 113 7.8 Mr Traynor’s role in Hamilton Ross 113 7.9 Poinciana and Worldwide Management 114 7.10 Amiens Securities Limited, Amiens Investments Limited and 7.11 Kentford Securities Limited 114 Total control exercised by M r Traynor 114 7.12 Mr Traynor as part-owner of Ansbacher 115 7.13 Additional matters 115 7.14 Mr Traynor and the Central Bank of Ireland 115 7.15 Assessment of M r Traynor’s responsibility for the wrongdoing of Ansbacher and Hamilton Ross 117 7.16 Operation of trusts 117 7.17 Unlicensed banking 117 7.18 Breaches of Companies Acts 117 7.19 Conspiracy to defraud 118 7.20 Use of subordinates 118 7.21 Making of payments without deduction of tax 118 7.22 Corporation tax 118 7.23 Possible criminal offences 118 RESPONSIBILITY OF MR DESMOND TRAYNOR 7.1 Introduction In view of the criticisms of Mr Traynor set out hereunder, it is appropriate that the Inspectors record the high esteem in which those who dealt with him held Mr Traynor. Almost without exception his personal qualities were emphasised by those with whom he came into contact. The Inspectors have discovered no case where any of the persons who entrusted money to him were themselves treated by him other than fairly. He was a man of immense energy who was very well organised in his business affairs. 7.2 Mr Traynor’s role in Guinness and Mahon In order to set out fully the impact made by M r Traynor on the Company under investigation, it is necessary to understand the role he played in the Guinness Mahon Group on a company-by-company basis. It is of some significance that Mr Traynor joined Guinness and Mahon in 1969, as this was a time of great change and development within the Guinness Mahon Group’s Irish operation. From the time he joined the bank, he was one of the most important executives in the organisation. In documentation dated 1971, he is described as Managing Director, but this must be considered in the context that, at that time, this title was given simultaneously to up to four officers of the bank. There appeared to be a pecking order among those holding these apparently equal titles, and M r Traynor’s place was clearly near the top of that order. The precise range of M r Traynor’s activities and responsibilities in these early years are now unclear but as noted below he played a central role in organising the expanded functions of Ansbacher (under its original name of GMCT). Mr Traynor was the executive in Guinness and Mahon who controlled the relationship between GMCT and Dublin to the virtual exclusion of all others. This was surprising at least in the early years, as the suggestion for the establishment of GMCT seems to have originated from M r John Guinness, the Executive Chairman. The influence and power of Mr Traynor within Guinness and Mahon grew quickly. Part of the reason must have been the increasing importance of GMCT to the financial well being of Guinness and Mahon. Cash injected by GMCT increased between 1973 and 1983 from £3 million to £30 million in respect of deposits in Guinness and Mahon and from £2 million to £90 million in respect of Guinness Mahon London. This put Mr Traynor in a very strong position within the Guinness Mahon hierarchy. From the other evidence received by the Inspectors, it is also likely that Mr Traynor’s increasing status reflected his ability and dedication. Up to May 1976, Guinness and Mahon was managed by a conclave of four managing directors. On the 10 May 1976, Mr Forwood resigned and the executive authority was redefined. capacity. Mr John Guinness remained as Chairman but now in a non-executive M r Traynor became deputy Chairman and Chief Executive. O ’Kelly retained the title of Managing Director. Mr Maurice This was the culmination of a process within Guinness and Mahon by which Mr Traynor’s dominance grew. From that time, the running of Guinness and Mahon was primarily in the hands of M r Traynor. From May 1976 to May 1986, there was only one executive whose views mattered within Guinness and Mahon - Mr Desmond Traynor. During this period, the deposits of GMCT in Dublin grew from £3 million to £39 million. 7.3 Mr Traynor as a director of Guinness Mahon London Guinness Mahon & Company Limited, the London based principal operating entity in the Guinness Mahon group of companies, was the owner of Guinness and Mahon and assumed sole control of GMCT within the group after 1984, even though the shares in GMCT were nominally owned by one of Guinness M ahon’s other subsidiaries. Traynor was appointed a director of Guinness Mahon London in 1971. He remained a Mr director of the main board for as long as he was a director and an employee in Ireland. He severed the connection in 1986 in circumstances which reflected profound disagreements between himself and M r Bruce Ursell, the managing director of the London bank. By reason of his membership of both Guinness and Mahon in Dublin and Guinness Mahon London, Mr Traynor was at all times from 1971 up to his departure in May 1986 on the Board of directors of the controlling entity of GMCT. 7.4 Mr Traynor’s role in GMCT As described above, M r Traynor was appointed a director of GMCT upon its incorporation. He was described for many years as the chairman of the company and was still on the board of directors of Ansbacher (as it had by then become) at the date of his death, 11 May 1994. Ansbacher has informed the Inspectors that M r Traynor was not a director from 1974 to 1981. There is some evidence that the Central Bank was informed of the intention of GMCT to protect itself against potential Irish tax complications by not having Irish officers. The Inspectors have concluded that any such formal decision was cosmetic only and that Mr Traynor should be considered a director or shadow director of Ansbacher/GMCT from the date of its incorporation to the date of his death. As a director, Mr Traynor was involved in and responsible for the strategic decisions of the company. He had also a further responsibility as an executive of the company in relation to its Irish business. In the absence of information from M r Traynor himself, the Inspectors could have been seriously disadvantaged in separating that portion of his work relating to his role as an executive of GMCT from his work as an executive of Guinness and Mahon. The potential confusion arises from the fact that actions taken by Mr Traynor in the period up to 1986 (when he retired as an executive of Guinness and Mahon) relating to GMCT business could have been take either in his capacity as an executive of Guinness and Mahon or in his capacity as an executive of GMCT or as a combination of both. The Inspectors have deemed it necessary to consider this matter in some depth so as to properly assess the role of GMCT in Ireland and Mr Traynor’s part in it during that period. That the executive work of Mr Traynor while employed by Guinness and Mahon included an element of work on behalf of GMCT is clear from a proposal made to Mr Traynor by Mr Bruce Ursell at the time of M r Traynor’s retirement from GMI. In a memo dated 17 October 1985, M r Ursell discusses the proposed arrangements for Mr Traynor’s departure as follows: ‘F urther to our conversation last week, I confirm that we would be very pleased fo r you to continue in the role o f Chairman o f Guinness Mahon Cayman Trust fo r a period o f at least three years from the end o f your employment at Guinness and Mahon. We would be agreeable to you moving into the office previously occupied by Don O ’Connor and having a computer terminal w ired up to tap into the Cayman Bureau. ’ In the present context, this extract shows that the chief executive of the parent company acknowledged that there would be continuing executive work for Mr Traynor on his resignation. This demonstrates that the executive tasks previously performed by Mr Traynor were partly done as an executive of GMCT. W hat remains is an assessment of the extent of the GMCT work. The Inspectors have concluded that the extent of the intermingling of Guinness and Mahon and GMCT work by Mr Traynor can best be assessed by considering what executive work continued to be performed by M r Traynor after his resignation from Guinness and Mahon. 7.5 Mr Traynor’s role after his resignation from Guinness and Mahon Immediately after his resignation in 1986, Mr Traynor commenced operating as arranged from a Guinness and Mahon premises in Trinity Street, Dublin. immediately adjacent to the Guinness and Mahon headquarters. This office was In the year during which Mr Traynor was at this address, there was no identifiable change in the way GMCT business was conducted. The computer access to Guinness and Mahon records that had earlier been offered to Mr Traynor was apparently put in place. It appears that in respect of the transaction of GMCT business, the office at Trinity Street was treated as an integral part of Guinness and Mahon. 7.6 Mr Traynor’s Ansbacher role at 42 Fitzwilliam Square In May 1987, M r Traynor was appointed chairman of CRH pic and commenced operating firstly from 19 Pembroke Street and later from 42 Fitzwilliam Square Dublin. From that time, a gradual change took place in his relationship with Guinness and Mahon. The internal memo format of issuing instructions gave way to a more formal communication pattern. Two examples of the mixing of the formal with the informal can be seen in two documents, a note to the Securities Department of Guinness and Mahon dated 7 October 1987 and a more informal instruction to Mr P O ’Dwyer in Guinness and Mahon dated 3 August 1988 (see Appendix VII(a) and Appendix VII(b)). Mr Traynor transferred to 42 Fitzwilliam Square when CRH moved there in 1989. From this address, M r Traynor conducted business on a significant scale on behalf of Ansbacher under its various names. The movement of money between accounts, the lodgement of funds, the organisation of payments to Ansbacher clients, the arrangement of back-to-back loans and other banking services, were all carried out by Mr Traynor from this address to the date of his death. The documents available to the Inspectors originating from or addressed to Fitzwilliam Square number many thousands. More than two thousand are executive instructions of one kind or another. The Inspectors obtained most of these documents from Guinness and Mahon and IIB. Other documents were obtained from Bank of Ireland and from NCB Stockbrokers. Communications from the Irish offices of Ansbacher to other parties were destroyed or removed by Mr John Furze of Ansbacher after the death of M r Traynor. An examination of these facts and of the available documents has led the Inspectors to conclude that all executive activity carried out in Ireland on behalf of Ansbacher from 1986 until the date of Mr Traynor’s death, was carried out under his direction and control. 7.7 Mr Traynor’s role in GMCT while employed by Guinness and Mahon The Inspectors have further concluded that M r Traynor’s control of Ansbacher’s Irish operation after he left Guinness and Mahon merely reflected similar activity conducted by him while also an executive in Guinness and Mahon (though it had become more complicated as ownership and control of the company was transferred elsewhere). This conclusion is entirely consistent with the memo from the London managing director quoted above on the occasion of Mr Traynor’s departure from Guinness and Mahon. The facts found are also supported by the absence of any instructions from Cayman or any outside source for the majority of GMCT transactions while Mr Traynor was in Guinness and Mahon. This leads to the conclusion that M r Traynor, in originating the action within Guinness and Mahon, was doing so in a dual capacity as an executive of GMCT and Guinness and Mahon. 7.8 Mr Traynor’s role in Hamilton Ross In addition to the companies within the Guinness Mahon Group, Mr Traynor also had a relationship with other entities used in the offshore scheme. As will be considered in greater detail further on in this Report, Hamilton Ross Company Limited played in later years an increasing role in Ansbacher’s Irish business. Prior to the late 1980s, it had no part to play. From 1988 onwards, GMCT/Ansbacher used it as a convenience for recording, in the company’s books in Cayman, a portion of the sterling pooled accounts. Up to September 1992, the Hamilton Ross name was not used in Ireland. Ansbacher’s name was used exclusively in Ireland as the depositor of the Cayman funds. At this time, Hamilton Ross was probably owned by M r Traynor but was managed and controlled by Ansbacher. Any fees earned by Hamilton Ross were credited to the Ansbacher profit and loss account. Those customers in Ireland who used the facility were probably unaware that their Cayman funds were held in the name of Hamilton Ross. After September 1992, the status of Hamilton Ross changed. As related in Chapter 2, in 1992, all Hamilton Ross accounts were taken off Ansbacher’s books at the direction of London management. At the same time, Mr Traynor gave instructions to IIB to close certain accounts that had been held in that bank in the name of Ansbacher, and to transfer the funds to new accounts in the name of Hamilton Ross. In Chapter 24, the Inspectors conclude that there is evidence tending to show that, from September 1992 to early 1997, Hamilton Ross was engaged in banking in Ireland without a licence, and in other illegal activities as successor to Ansbacher’s Irish business. Mr Desmond Traynor was responsible for that activity as the prime mover in its implementation. Indeed, the control exercised by him over Hamilton Ross was such that he was at all material times after September 1992 a shadow director of Hamilton Ross. 7.9 Poinciana and Worldwide Management Two entities carried the Poinciana name, Poinciana Fund and Poinciana Fund Limited. These entities, together with Worldwide Management and Consultancy Services Ltd formed the assets of a trust called Poinciana Trust, which was established by Mr Traynor in 1993. Poinciana Fund Ltd had been used much earlier as an Ansbacher vehicle in its Cayman Island books in the same way as Hamilton Ross was later used. The Poinciana entities were beneficially owned by M r Traynor. They still exist and now appear to be awaiting trustee action to distribute the funds held for the named beneficiaries, members of the Traynor family 7.10 Amiens Securities Limited, Amiens Investments Limited and Kentford Securities Limited The Amiens companies, and the use made of them by M r Traynor have been described in Chapter 2. Kentford Securities Limited was a company whose Bank of Ireland account was used as a vehicle to cash cheques issued by IIB to clients of Ansbacher, as IIB did not have a cash facility. These entities were part of the unlicensed banking operation and Mr Traynor controlled each of these companies. 7.11 Total control exercised by Mr Traynor In summary, the Inspectors are satisfied that M r Traynor acted as the Dublin executive of GMCT while in the employment of Guinness and Mahon in addition to his Guinness and Mahon executive responsibilities. From the date of his resignation from Guinness and Mahon in 1986 until his death in 1994, he continued to be the executive presence of GMCT/Ansbacher in Ireland, although located outside Guinness and Mahon. At no time during Mr Traynor’s lifetime was any other person in control of Ansbacher’s Irish business. 7.12 Mr Traynor as part-owner of Ansbacher Mr Traynor was briefly part of the consortium that owned the company in 1988. Later that year, the consortium disposed of 75% of the company to Henry Ansbacher Holdings Pic, London. The consortium continued to own 25% of the company until it was bought out in April 1993. 7.13 Additional matters Before considering the responsibility of Mr Traynor as a director and executive of Ansbacher, certain additional matters arise which relate to M r Traynor himself. Over the years, he made certain representations to others, which in the view of the Inspectors were not correct. These representations, which are set out below, were made in his capacity as a director of Guinness and Mahon. 7.14 Mr Traynor and the Central Bank of Ireland In 1976, the Central Bank of Ireland expressed to Mr Traynor its concern that tax avoidance was one of the main objects of GMCT. M r Traynor denied this and said that the Guinness and Mahon subsidiaries (including GMCT) were all deposit taking institutions offering full banking services. executor and trustee business. Their main income, he said, derived from In fact, the balance sheet of GMCT at 31 March 1972 shows that 80% of its funds were lent to companies in the Guinness Mahon Group and only 20% lent to ordinary customers. This indicates the true nature of the operation at this stage. GMCT was at that time a company whose function was twofold: firstly, to collect offshore deposits for both Guinness and Mahon and Guinness Mahon London for the purpose of assisting the liquidity of the Irish and UK operations, and secondly, to provide a tax haven for the funds of Irish residents. A minute of a meeting between Mr Traynor and the Central Bank on 8 February 1977 contains the following statement: ‘Tax Havens. M r Traynor outlined in some detail the operations o f the bank’s subsidiary companies in Cayman Island. Guernsey and Jersey. He stressed that they were basically trust companies but that a proportion o f the assets being managed were deposited with the trust companies themselves. have banking status. The three companies themselves He also emphasised that the funds were not placed on deposit fo r the purpose o f tax avoidance or evasion. ’ Customers’ deposits at this stage had reached £19 million and the tax evasion scheme was well in place. In fact, as is clear from a 1978 report, by that time the Central Bank was aware that documentation relating to the Cayman business was kept offshore as a precaution against a physical inspection of the bank’s affairs by the Revenue Commissioners. Mr Traynor assured the Central Bank on a number of occasions during the 1970s and 1980s that no funds had been transferred from Ireland to the Cayman Islands since 1972 (see Appendix VII(c)). This may have been literally true, but in fact funds were sent from Ireland to College Trustees Ltd, a Guinness Mahon trust vehicle in Guernsey, which in turn transferred these funds to Cayman. However, in fairness to Mr Traynor, he had explained this to the Central Bank in 1979 as follows: ‘A nother Guinness Mahon company, Guinness Mahon Guernsey Limited, are the trustees o f hundreds o f discretionary trusts, owning companies with registered offices in the Cayman Islands. Deposits from Irish residents were placed in the name o f one o f these trusts which onlends to one o f these companies and the funds are in turn deposited with the Cayman bank. The Cayman bank redeposits these funds with the Dublin bank which may give an advance to a customer (original depositor) secured by these funds. ’ (see Appendix VII(d)). 7.15 Assessment of Mr Traynor’s responsibility for the wrongdoing of Ansbacher and Hamilton Ross In Chapters 5 and 24, the Inspectors have examined the evidence tending to show wrongdoing on the part of Ansbacher and of Hamilton Ross. They now assess the extent of M r Traynor’s responsibility for any such wrongdoing 7.16 Operation of trusts As described in Chapter 3, trusts were established by Irish clients - in many cases legitimately - in the Cayman Islands. They were, however, operated by the beneficial owners in a manner that rendered them sham operations. The Inspectors conclude that there is evidence tending to show that Mr Traynor facilitated this abuse of the trusts in that he accepted instructions from beneficial owners in Ireland and implemented these instructions without proper authorisation from the trustees 7.17 Unlicensed banking Again it can be seen in Chapter 3 that Ansbacher operated a deposit taking service in Ireland from the 1970s to 1994. After 1992, Hamilton Ross was also used for this purpose. Money belonging to depositors was accepted and credited to Ansbacher and Hamilton Ross accounts in Guinness and Mahon, IIB and to a lesser extent, Bank of Ireland Private Banking. There is evidence tending to show that M r Traynor thereby facilitated the carrying on of a banking business by Ansbacher and Hamilton Ross in Ireland without a banking licence. 7.18 Breaches of Companies Acts The Inspectors have also concluded that there is evidence tending to show that Mr Traynor, while an executive director of Ansbacher and Hamilton Ross, knowingly and wilfully permitted Ansbacher, while it was carrying on business in Ireland, to fail to furnish to the Registrar of companies the information required by sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 7.19 Conspiracy to defraud The Inspectors have concluded that there is evidence tending to show that Ansbacher and Hamilton Ross conducted their business in Ireland in such a manner as to intentionally defraud the Revenue authorities. As executive director of Ansbacher and Hamilton Ross in Ireland, M r Traynor was fully aware of the activities in question. There is therefore evidence tending to show that M r Traynor was the instrument by which Ansbacher and Hamilton Ross committed these acts. 7.20 Use of subordinates In his role as executive director of the operations of Ansbacher and Hamilton Ross in Ireland, there is evidence tending to show that M r Traynor improperly used subordinates such as M r Padraig Collery and Ms Joan Williams in the unlawful activities of that business. 7.21 Making of payments without deduction of tax There is evidence tending to show that Mr Traynor approved of and participated in the making of payments to Mr Padraig Collery and Ms Joan Williams without deduction of appropriate tax. 7.22 Corporation Tax Ansbacher and Hamilton Ross, while trading in Ireland, were potentially liable for Irish Corporation Tax. There is evidence tending to show that Mr Traynor through his actions facilitated the evasion by each of these companies of its tax responsibilities. 7.23 Possible criminal offences. The Inspectors are of the view that many of the actions of M r Traynor as set out above may constitute evidence tending to show the commission of criminal offences. Because Mr Traynor is no longer alive, the Inspectors did not further consider this matter. It is, however, possible that M r Traynor’s actions, taken together with those of others, would constitute evidence of conspiracy offences for which those third parties would still have a responsibility. It is also possible that the actions of Mr Traynor would constitute evidence of criminal acts of corporate bodies of which he was a principal. In this context, the Inspectors have been asked by Mr Traynor’s family to point out that, in the family’s view, his actions were taken in the context of his implementation of Guinness and Mahon policy, and not otherwise. CHAPTER 8 RESPONSIBILITY OF MR JOHN FURZE INDEX Page 8.1 Introducti on 122 8.2 Mr Furze as director of GMCT 122 8.3 Mr Furze in charge of Irish clients 122 8.4 Policy of concealment 123 8.5 Visits to Ireland 123 8.6 Part-ownership of GMCT 124 8.7 The Pruna affair 124 8.8 Hamilton Ross 125 8.9 Buy-out of M r Furze’s minority shareholding 126 8.10 Death of Mr Traynor and destruction of GMCT files 127 8.11 Role of Mr Furze after M r Traynor’s death 127 Page 8.12 Assessment of Mr Furze’s responsibility for the wrongdoing of Ansbacher 127 8.13 Conspiracy to defraud 128 8.14 Unlicensed banking 128 8.15 Breaches of Companies Acts 128 8.16 Breach of Cayman law 128 8.1 Introduction Together with John Collins and the late Desmond Traynor, the late M r John Furze was one of the first directors of GMCT, and was to become the individual most closely involved with M r Traynor in the running of Ansbacher’s Irish business. He was also a director of Hamilton Ross Company Limited, and of Poinciana Fund Limited. He first went to the Cayman Islands in 1967 or 1968 to assist Mr Collins in the new branch of the Bank of Nova Scotia, which had just opened there. He left again for a brief period, but returned about 1970, and remained there until his death in 1997. He was regarded as one of the pioneers in the evolution of the Islands as an offshore financial centre. During his time in Cayman, he was active in both civil and community affairs, and was a leading member of the Rotary Club. According to officials of Ansbacher, a leading Caymanian politician described M r Furze after his death as being ‘among the best o f persons who emigrated to the Cayman Islands'. He has been described to the Inspectors by those who met him as a bluff and jovial person, who, when he visited Mr Traynor in Guinness and Mahon or CRH, was in the habit of giving little gifts to members of staff who provided him with assistance. 8.2 Mr Furze as director of GMCT As related in Chapter 2, when Guinness and Mahon established GMCT as a trust company in January 1971, its administration was carried out at first by the Cayman branch of the Bank of Nova Scotia. The Bank nominated Mr Collins and M r Furze as directors. When in 1973, GMCT obtained its own premises in Cayman, M r Collins and Mr Furze left the Bank of Nova Scotia to become full time employees of GMCT. 8.3 Mr Furze in charge of Irish clients Although, in Ansbacher’s own words in the information document provided by them to the Inspectors (see Appendix 11(c)) ‘GMCT was, in essence, run as a quasi partnership ’, the informal division of responsibilities between the two men meant that, while Mr Collins looked after the North American and Caribbean business, M r Furze was mainly responsible for administration and in effect acted as the account manager for Irish clients - in particular, those introduced by Mr Traynor. Whenever M r Traynor had occasion to communicate with GMCT about its Irish business, he almost invariably contacted Mr Furze. 8.4 Policy of concealment From an early date, Mr Furze was active in promoting the policy of concealment by means of which, as described in Chapter 3, GMCT conducted its business with intent to defraud creditors of some of its clients. The bureau system on which the memorandum accounts were maintained by M r Collery in Guinness and Mahon was originally set up at the request of Mr Furze. He makes the request in a letter to Guinness and Mahon in February 1978, and goes on to say: ‘N eedless to say, we w ill also require your written assurance that neither the programme information stored nor the accounting records themselves, are made available to any third parties such as auditors, bank inspectors, etc. ’ 8.5 Visits to Ireland Mr Furze visited Ireland annually. On those occasions, he would ‘set up shop’ in one of the conference rooms in Guinness and Mahon. During this time, it was his habit to send out statements to Irish clients. M r Traynor’s secretary, Ms Williams, would type the covering letters for him. Mr Furze also made use of the CRH premises when he came to visit Ireland. He used the offices for the purpose of preparing reconciliation statements between the records held in Cayman and the records held in Dublin. It appears that he also met there some clients who were known to him. 8.6 Part-ownership of GMCT As related elsewhere, Mr Furze, together with Messrs Traynor and Collins and Mr Hart formed a consortium in June 1988 for the purpose of purchasing GMCT. In August of the same year, four companies representing the four men sold 75% of their shareholding in GMCT to Henry Ansbacher Holdings pic. 8.7 The Pruna affair Although the division of responsibilities between M r Collins and M r Furze meant that Mr Collins looked after American business, for some reason that remains unexplained, Mr Furze had a number of American clients, who were in the main members of a family called Pruna, or associates of that family. M r Furze’s involvement in the affair of the Pruna loans is one of the most bizarre matters in the whole Ansbacher saga. The Pruna family members and their associates were residents of the United States. During the relevant period, some of them were under investigation for drug-related offences in the US. Two members of the family, Fernando and Eudelia Pruna, who were clients of Ansbacher, had loans from Guinness and Mahon backed by their Cayman funds. Guinness and Mahon furnished the Inspectors with copies of correspondence consisting of letters written on Guinness and Mahon notepaper, but bearing an illegible signature, from which it appeared that Guinness and Mahon had made a loan to two other members of the Pruna family, Andreas Pruna and his wife Maria Isobel, secured on a property in Miami Beach, Florida. In November 1985, M r Andreas Pruna wrote to Guinness and Mahon saying that he would be unable to make the first interest payments and that he had doubts about his ability to repay the principal sum. He offered to transfer the deeds of the property in Miami Beach to Guinness and Mahon in lieu of foreclosure. By further letter on Guinness and Mahon notepaper, Guinness and Mahon appeared to accept the offer, and to arrange for the property to be registered in the name of Mars Nominees, their nominee company. This registration in fact took place. Steps were later taken to convey the property by warranty deed to Ms Maria Isobel Pruna, the wife of Andreas. The Inspectors have received evidence from Guinness and Mahon to the effect that no bank documentation relating to the alleged loan exists, that Guinness and Mahon believes that the loan was a fiction, and that GMCT falsely used Guinness and M ahon’s notepaper to create the alleged correspondence between Guinness and Mahon and Mr Andreas Pruna. In 1988, Mr Furze wrote to Mr Traynor to inform him that the Prunas were under investigation in the US for alleged drug-related offences. He explained that they were clients of Cayman, and that Mars Nominees would be involved in the investigation because the Miami Beach property had been registered in its name. Mr Furze alleged that he had not known this. Subsequently, an arrest and forfeiture notice was served on Guinness and Mahon and Mars Nominees The Inspectors believe that on the balance of probabilities, M r Furze not only knew of the registration of the property in the name of Mars Nominees, but also was active in bringing it about. It is not possible to say whether anyone in Guinness and Mahon was complicit in the affair, but it is clear that M r Furze could easily have obtained Guinness and Mahon headed notepaper on his trips to Dublin, without the involvement of any other person. The Inspectors have obtained evidence from Mr John Collins to the effect that, although M r Collins himself usually dealt with American clients, Mr Andreas Pruna was a client solely of M r Furze. The Inspectors are of the view that there is thus evidence tending to show that M r Furze, acting in his capacity as a director of GMCT, conspired with Mr Andreas Pruna in an attempt to prevent, by fraudulent means, the forfeiture of the Miami Beach property by the US authorities. 8.8 Hamilton Ross As related in Chapter 24, in September 1992, the London management of Ansbacher discovered the existence of the Hamilton Ross accounts. M r Furze described Hamilton Ross’s business to M r McAuliffe of the London office as being that of receiving deposits in Ireland from clients, and then banking them in IIB ‘on behalf o fA L [Ansbacher Limited] d. Upon further investigation, it emerged that M r Furze was the registered owner of the majority shareholding and was also one of the directors. The company had no reserves, and appeared to be used exclusively for the purpose of the collection and onward transmission of deposits to Ansbacher. Mr McAuliffe and his colleague, M r Fraser Jennings, noted that Hamilton Ross did not have a bank mandate for the operation of its accounts with Ansbacher. They were greatly disturbed by their findings and, in a fax to the chief executive, Mr Fenhalls, indicated their fears that the Hamilton Ross operation may have been in breach of the law in Ireland. They stressed that urgent action needed to be taken to ensure the speedy termination of the business. Mr Fenhall’s immediate reaction was to rid the company of both Mr Traynor and Mr Furze, but, on receiving reassurance from Mr Traynor that the Hamilton Ross business would be taken off Ansbacher’s books with immediate effect, he and other members of London management realised that the sudden departure of both directors might have had a detrimental effect upon Ansbacher’s standing with its clients and with the market. 8.9 Buy-out of Mr Furze’s minority shareholding However, this event, which had shaken the trust of London management in M r Traynor and M r Furze, was a major factor in causing Ansbacher to seek an early buy-out of the minority shareholding in the company held by Messrs Traynor, Collins, Furze and Hart. In a draft internal memo of 16 September 1992, M r Fenhalls sets out his thoughts on the matter as follows: ‘The role envisaged fo r Messrs Furze and Collins would be that o f non­ executive deputy chairmen o f the organisation (thus enabling them to maintain their face on the Island) See Appendix 11(c) 8.10 Death of Mr Traynor and destruction of GMCT files In May 1994, Mr Traynor died suddenly. His death threw the Ansbacher operation in Ireland into disarray. Mr Furze came to Ireland to attend M r Traynor’s funeral, and while in Ireland, he attempted to make some temporary arrangements about the running of the business. He asked Mr Padraig Collery to act as a liaison person in Ireland until such time as alternative arrangements were made. He also asked him to contact Ms Joan Williams and to obtain possession of the Cayman files, which, of course, were at that time in Mr Traynor’s office on the premises of CRH at 42 Fitzwilliam Square. M r Collery did so, and removed the files to a premises owned by Mr Sam Field-Corbett at Winetavem Street. In October or November of the same year, Mr Furze paid another visit to Dublin. He examined the files in Winetavern Street, and, under his instructions, some were destroyed. O f the remainder, some stayed in W inetavem Street and some returned to Cayman in Mr Furze’s custody. It appears that M r Furze and Mr Collery destroyed more files in or around September 1995. The deliberate destruction of the files has been a major impediment to the Inspectors in their investigation of Ansbacher’s Irish business and it is reasonable to conclude that it served to protect the identity of the Irish clients, and to prevent knowledge of their offshore funds from coming to the attention of the Irish Revenue Commissioners. 8.11 Role of Mr Furze after Mr Traynor’s death After Mr Traynor’s death, M r Furze took over responsibility for decisions on the Irish accounts. If one of the Irish clients wished to withdraw some funds, Mr Collery would ring Mr Furze to verify the matter. Again, it was Mr Furze who, after M r Traynor’s death, organized the continuation of payments to Mr Collery for his work on behalf of Hamilton Ross. Mr Furze resigned as a director of Ansbacher in April 1995. He died in 1997. 8.12 Assessment of Mr Furze’s responsibility for the wrongdoing of Ansbacher In summary, M r Furze worked closely with M r Traynor. From the beginning of his time at Ansbacher, he was fully aware of the nature of its Irish business. As a director, he must have consented to the opening and maintenance by Ansbacher of accounts in Guinness and Mahon and in IIB, knowing them to contain funds beneficially owned by Irish residents. He must also have consented to the use of the memorandum accounts by Ansbacher’s representatives in Ireland to keep secret the identity of Ansbacher’s clients, and to the making of lodgements to and withdrawals from the accounts in Ansbacher’s name in Guinness and Mahon and in IIB by Ansbacher’s Irish clients. It was M r Furze who reconciled those accounts when M r Collery sent them to Cayman on a monthly basis. As one of the first directors, and particularly as the director with responsibility for Irish clients, Mr Furze bears equal responsibility with Mr Traynor for any wrongdoing on the part of the company. 8.13 Conspiracy to defraud The Inspectors have concluded that the matters set out above constitute evidence tending to show that Mr Furze conspired with his fellow-director Mr Traynor to conduct Ansbacher’s affairs with intent to defraud a creditor of some of its clients, namely, the Irish Revenue Commissioners. This conclusion might, if M r Furze were still alive, have given rise to the possibility that he had committed certain criminal offences. However, because Mr Furze is no longer alive, the Inspectors did not think it useful to consider this matter further. 8.14 Unlicensed banking The Inspectors have concluded in Chapter 5 that there is evidence tending to show that Ansbacher carried on an unlicensed banking business in Ireland. They have also considered the responsibility of M r Furze for any such unlicensed banking business carried on by Ansbacher and have concluded that there is evidence tending to show that he consented to or approved of the carrying on of such business. 8.15 Breaches of Companies Acts The Inspectors have also concluded that Mr Furze, while a director of Ansbacher, knowingly and wilfully permitted Ansbacher, while it was carrying on business in Ireland, to fail to furnish to the Registrar of companies the information required by sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 8.16 Breach of Cayman law Finally, the Inspectors have concluded that there is evidence tending to show that Mr Furze failed in his duty under Cayman law to apply for the permission required by Section 10(a) of the Cayman Islands Banks and Trust Companies Law of 1989 (as amended) to open outside the Cayman Islands ‘a subsidiary, branch, agency or representative office’ without the prior written permission of the relevant Cayman Islands authority. CHAPTER 9 RESPONSIBILITY OF MR JOHN COLLINS INDEX Page 9.1 Introducti on 131 9.2 Early contacts with Mr Traynor 131 9.3 Mr Collins as director of GMCT 132 9.4 Mr Collins as part-owner of GMCT 133 9.5 Loans from Guinness and Mahon to US clients 134 9.6 Hamilton Ross 134 9.7 Day-to-day running of GMCT 135 9.8 Assessment of responsibility of Mr Collins for the wrongdoing of Ansbacher 136 9.9 Unlicensed banking 137 9.10 Breaches of the Companies Acts 137 9.11 Breach of Cayman law 137 9.1 Introduction Mr John Collins is the sole surviving founding director of Ansbacher (Cayman) Limited. He gave evidence on oath to the Inspectors in London in October 2001. M r Collins’s career has always been in the trustee department of banks, beginning with his first position as a seventeen year-old in the Luton UK branch of Barclay’s Bank. In 1965, he went to Jamaica as trust manager for the Montego Bay office of the Bank of Nova Scotia Trust Company. In 1966, he was sent to open an office of that Bank in the Cayman Islands. In 1967 or 1968, the head office of the Bank of Nova Scotia sent another official to assist M r Collins. This was Mr John Furze. Mr Furze assisted Mr Collins for a short period, and then returned to Jamaica. However, at Mr Collins’ request, he returned to Cayman in the late 1960s or early 1970s to take up the position of assistant manager. 9.2 Early contacts with Mr Traynor On a trip to Ireland in the late 1960s to visit a colleague who was there to expand Nova Scotia’s international business, Mr Collins was introduced to M r Desmond Traynor, who at that time was still working in Haughey Boland. Shortly afterwards, on another trip, Mr Collins met him again, but this time in Guinness and Mahon, where he had been appointed to the board of directors. Mr Collins was soon involved in Guinness and M ahon’s plans for expansion into the Cayman Islands. Guinness and Mahon had at that time instructed the late Mr Liam McGonagle, solicitor, to arrange for the incorporation of seven companies in the Caymans, of which four were to be tax-exempt companies. In June of 1969, M r Collins called to see two of the Guinness and Mahon directors, Mr John Guinness and Sir George Mahon, to discuss the companies. Around that time, M r Collins tried to interest Guinness and Mahon in a deal to purchase some land in Cayman. Guinness and Mahon agreed; a Cayman company, Northern Finance Limited, was established to carry out the transaction, and in due course the land was sold and a substantial profit made. 9.3 Mr Collins as director of GMCT When Guinness and Mahon established GMCT as a trust company in January 1971, its administration was carried out by the Bank of Nova Scotia Trust Company (Cayman) Limited. The Bank nominated Mr Collins and M r Furze as directors. For some years, the company was effectively run by both of them, together with Mr Traynor who was of course operating at all times in Ireland. In Ansbacher’s own words: ‘GM CT was, in essence, run as a quasi partnership. O f the ‘p a rtn ers’, M r Traynor remained based in Dublin, although he would visit Cayman at least three times a year fo r board meetings and to work with M r Furze on issues such as the reconciliation o f the client accounts ... M r Furze, conversely, visited M r Traynor once or twice a year in Dublin. The two executive directors, Messrs Furze and Collins, worked in the offices o f GMCT in Cayman. There was some form al division o f responsibilities between those two individuals but with considerable ‘blurring ’ at the edges reflecting the partnership nature o f the organisation. ’ Ansbacher goes on to indicate what these formal divisions of responsibilities were: F or example, M r Furze was mainly responsible fo r administration and in effect acted as the account manager fo r Irish clients, and in particular those introduced by M r Traynor, whereas local Cayman public relations and marketing were mainly the responsibility o f M r Collins. M r Collins never introduced or managed any Irish business, although from time to time he did complete administrative tasks on such accounts in the absence o f M r Furze. ’ (see at Appendix 11(c)). In May of 1971, Mr Collins visited Ireland, where M r Traynor set up meetings with the accountancy firm of Kennedy Crowley (now KPMG) who were interested in finding out what services the new GMCT could offer to their clients. M r Collins visited Dublin again in the late summer of 1972, where he had talks with Mr Traynor about Cayman trusts. When, in 1973, GMCT obtained its own premises in Cayman, M r Collins and Mr Furze left the Bank of Nova Scotia to become full time employees of GMCT. M r Collins told the Inspectors that, given his age, he saw this as possibly his last opportunity to take part in an entrepreneurial venture and although it was a risk when compared with a safe career in the Bank of Nova Scotia, he decided to seize the opportunity. He had by then spent some years in Cayman and had built up contacts. As he explained, trust company business is very personal, clients tend to stay with someone with whom they have built up a relationship, and M r Collins, in his own words, felt that he could ‘make a go of it’. Around that time too, the Cayman Islands were removed from the scheduled territories, with the disincentive to Irish business that this implied, and Mr Collins and M r Furze felt they might be able to develop business for GMCT in North America and the Caribbean. 9.4 Mr Collins as part-owner of GMCT When in 1988 Guinness Mahon & Company in London decided to sell GMCT, which they had purchased from Guinness and Mahon some years before, it was purchased by a consortium comprising Messrs Collins, Traynor and Furze and M r Hugh Hart, a Cayman lawyer who had become a director of GMCT. They used a vehicle called Chichester Investments Limited to do so. Mr Collins told the Inspectors that the matter arose when the Guinness Peat Group Ltd, the ultimate holding company, indicated its intention to divest. GMCT was very keen to maintain its independence and to avoid being sold en bloc with other Guinness Group companies. The negotiations on behalf of GMCT were undertaken principally by M r Hart, although Mr Collins himself was deeply involved. The sale went through, but almost immediately, the consortium sold 75% of the shareholding to the Henry Ansbacher Group. This transaction is dealt with in greater detail elsewhere in this report. M r Collins’s explanation for this immediate abandonment of independence is that having bought the company, the group of directors began to worry that there was not perhaps a great future for a totally independent trust company with no backing. They were willing to try, if backing was not forthcoming, but they felt somewhat unhappy with the situation in a climate where business was not exactly booming. They therefore approached several parties, including Credit Suisse, without success, and finally approached Richard Fenhalls of Ansbacher, who they had known in the days when he was chief executive of Guinness Mahon London. This led to the purchase of GMCT by the Ansbacher Group. 9.5 Loans from Guinness and Mahon to US clients From that time on, M r Collins appears to have had very little involvement in the Irish business of Ansbacher, devoting himself to the interests of the American clients. Occasionally, however, American and Irish interests overlapped, as in the case of backto-back loans from Guinness and Mahon to the Enochs, clients of M r Collins who, though Irish, resided in the United States. The Enochs’ case is dealt with in Chapter 23 of this report. For present purposes, it is noteworthy that in a letter written to Guinness and Mahon on 13 June 1990 to negotiate the terms of the loans, Mr Collins stated: ‘Your facility letter to Stephen Enoch w ill not mention the hypothecated deposits that are being provided as security’. The omission from Guinness and Mahon facility letters of any mention of a GMCT deposit securing a loan was part of GMCT’s policy of concealment, and the Inspectors have concluded in Chapter 5 that there is evidence tending to show that it formed part of the method by which GMCT conducted its affairs with intent to defraud creditors of some of its clients, whether they were the Irish Revenue Commissioners or the Revenue authorities of other countries. Mr Collins remained an executive director of GMCT until May 1995, and continued as a non-executive director until his retirement in October 2000. 9.6 Hamilton Ross A later section of this Report deals in some detail with the discovery by Ansbacher’s London management in 1992 of the Hamilton Ross accounts, and the ensuing attempts by management to have that part of the Irish business closed down. Mr Collins appears to have been involved only in a peripheral way in those events. As a member of the board, he was of course aware that they were taking place, but, as he him self told the Inspectors, ‘By that time, Fraser had come in and when this was going on, I think I was one o f the excluded parties Mr Collins told the Inspectors that for the first couple of years, although both he and Mr Furze held the title of joint managing director, he, as the elder by some seven or eight years was prim us inter pares. After that time, he said, they were equals, reporting regularly to M r Traynor back in Dublin. As time went on, Mr Collins did more of the North American and Caribbean business, while Mr Furze worked more closely with Mr Traynor on the Irish business. 9.7 Day-to-day running of GMCT Mr Collins told the Inspectors that board meetings were held about once every three months in the early days. These were attended by M r Traynor and a representative from Guinness Mahon London. However, all day-to-day management decisions were made by Mr Collins and M r Furze, who effectively ran the little company between them. As Mr Collins said, they were in daily contact and their office doors were wide open. Notwithstanding the greater involvement of M r Furze, Mr Collins was not totally uninvolved in the Irish business of the new company. It was he who conducted the initial discussions on trusts with Kennedy Crowley and Guinness and Mahon and who obtained as a result some Irish trust business. He also visited solicitors’ firms on these marketing trips. Even when he was not actively involved in a particular aspect of the Irish business, Mr Collins would have had a general awareness of what it was: as he told the Inspectors, ‘Fraser’ was Mr Fraser Jennings of Ansbacher’s London office. In 1989 the Ansbacher group purchased another Cayman company, CITCO. Ansbacher then set about merging its two Cayman companies. The proposed merger apparently met with some resistance, particularly from Mr Furze. This difficulty, together with a growing realisation of the autonomy enjoyed by Mr Traynor in his conduct of the Irish business of Ansbacher, prompted the Chief Executive, Mr Richard Fenhalls, to second Mr Jennings and Mr Kevin McAuliffe to Cayman in early 1992. As part of his secondment, Mr Jennings was made a managing director of Ansbacher. ‘...it isn 7 a question that there is a w all there that I cannot know what is going on over there and [John FurzeJ can 7 know what is going on over here, that d id n ’t happen... ’ 9.8 Assessment of responsibility of Mr Collins for the wrongdoing of Ansbacher The Inspectors, while acknowledging that there was a formal division of responsibilities among the members of the board, point out that in such a small company the three early directors must take equal responsibility for the management decisions that were made at that time - in particular, for the opening and maintenance of the non-resident accounts in GMCT’s name in Guinness and Mahon. These accounts, as seen in Chapter 3, contained the funds of Irish GMCT depositors, which funds were lodged in those accounts by GMCT itself. The Inspectors have concluded in Chapter 5 that these accounts were opened as part of GMCT’s policy of concealment, and are satisfied that by means of those accounts, Ansbacher provided a range of services to clients which were calculated to facilitate those clients in the evasion of their taxation liabilities. The Inspectors are therefore satisfied that there is evidence tending to show that in this way, Ansbacher conducted its affairs with intent to defraud the Irish Revenue Commissioners. M r Collins must take his share of the responsibility for the decision to open and maintain the accounts. Again, as explained in Chapter 3, where an Irish client had funds in foreign currency on deposit with GMCT, his funds were contained in an account in GMCT’s name on the books of Guinness and Mahon, but with a coded reference. However, all accounts held in sterling were pooled, and placed in one large account in GMCT’s name. Records of the sub- (or ‘memorandum’) accounts of the pooled account did not appear on Guinness and M ahon’s books, but instead were held on a computer system maintained by M r Padraig Collery, which, although sharing the same hardware as Guinness and M ahon’s own system, was completely independent of it. Customer names were not held on the system; instead, each account was identified by a code. The clients could use the GMCT accounts in Dublin to make lodgements to and withdrawals from their Cayman funds, and these transactions were recorded by M r Collery and sent on a regular basis to Cayman, where the account of the client in question was updated accordingly. The Inspectors have found evidence tending to show that Ansbacher had structured its system in this way with intent to defraud the Irish Revenue Commissioners. The early directors, including Mr Collins, must also take responsibility for this. The Inspectors do not consider, however, that the involvement of M r Collins was so substantial as to amount to evidence tending to show the commission of any criminal offence in this regard. As pointed out above, Mr Collins was principally concerned with the American business of the company, and did not take an active part in the day-to-day conduct of the Irish business 9.9 Unlicensed banking The Inspectors have also found in Chapter 5 that there is evidence tending to show that Ansbacher conducted a banking business in Ireland without the licence required by the Central Bank Act, 1971 (as amended). For this too, M r Collins, as a director involved in the making of the decision to carry on business in Ireland, must take his share of responsibility. In the opinion of the Inspectors, M r Collins either approved of or consented to the carrying on of this banking business, or he was wilfully negligent in not seeking to prevent it. 9.10 Breaches of the Companies Acts Mr Collins also knowingly and wilfully permitted GMCT to carry on business in Ireland without furnishing to the Registrar of companies the information required in respect of foreign companies by sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963 9.11 Breach of Cayman law Finally, Section 10(a) of the Cayman Islands Banks and Trust Companies Law of 1989 (as amended), a Cayman Islands law, forbids a bank licensed under that law from ‘opening outside the islands a subsidiary, branch, agency or representative office’ without the prior written permission of the relevant Cayman Islands authority. The information available to the Inspectors indicates that had Ansbacher applied for such a permission it would almost certainly have been granted. To do so however would have run counter to its policy of secrecy and concealment in relation to its Irish business. It did not apply for such permission and the absence of such permission rendered it in breach of the laws of the Cayman Islands. For this too M r Collins must accept his share of the responsibility. CHAPTER 10 RESPONSIBILITY OF GUINNESS AND MAHON INDEX Page 10.1 Introduction 140 10.2 Involvement of Guinness and Mahon 140 10.3 Conspiracy to defraud 141 10.4 Breaches of taxation legislation 141 10.5 Unlicensed banking 141 10.1 Introduction The activities of Guinness and Mahon referred to in this conclusion ceased a number of years prior to the acquisition of Guinness and Mahon by Irish Life & Permanent pic. Irish Life & Permanent pic bears no responsibility for any of the said activities of Guinness and Mahon. 10.2 Involvement of Guinness and Mahon As described in preceding chapters, much of that wrongdoing took place on the premises of Guinness and Mahon. The Inspectors have concluded that Guinness and Mahon, as Ansbacher’s parent from 1971 to 1984, bears a grave responsibility for its wrongdoing during that period. During part of that period, M r Desmond Traynor was both Chairman of Ansbacher and Managing Director of Guinness and Mahon. Again, the Irish business of Ansbacher was carried out entirely by Guinness and Mahon personnel during that time. As described previously, M r Padraig Collery and Ms Joan Williams were both actively involved in the promotion and carrying out of Ansbacher’s Irish business. The evidence is that during the relevant period, Guinness and Mahon maintained accounts in the name of the then GMCT, knowing them to contain funds beneficially owned by Irish residents. Through the use of the memorandum accounts Guinness and Mahon kept secret the identity of GMCT’s clients. As part of the policy of secrecy surrounding Ansbacher’s Irish business, Guinness and Mahon concealed the nature of the security in bank documentation, when a loan was secured on a GMCT deposit. Finally, Guinness and Mahon facilitated Irish residents in making withdrawals from and lodgements to their GMCT accounts, and provided staff and technical facilities for maintaining GMCT’s Irish accounts and for processing its Irish customer statements. 10.3 Conspiracy to defraud The Inspectors are satisfied that there is evidence tending to show that from 1971 to 1984, during which time Ansbacher (then called Guinness Mahon Cayman Trust) was its subsidiary, Guinness and Mahon conspired with Ansbacher to defraud a creditor of Ansbacher’s clients, namely, the Revenue Commissioners, and that that there is therefore evidence tending to show that during the period 1971 to 1984, Guinness and Mahon may have committed the offence of conspiracy to defraud contrary to common law, which is an offence punishable by a fine or imprisonment. 10.4 Breaches of taxation legislation The conclusion set out above leads the Inspectors to conclude further that there is evidence tending to show that during the period 1971 to 1984 Guinness and Mahon may have committed the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the provisions of the appropriate tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 10.5 Unlicensed banking The matters set out above also constitute evidence tending to show that from 1971 to 1984 Guinness and Mahon aided and abetted Ansbacher to carry on a banking business in the State without the licence required by Section 7 of the Central Bank Act, 1971. This leads the Inspectors to conclude further that there is evidence tending to show that Guinness and Mahon was an accessory to the carrying on of Ansbacher’s unlicensed banking business within the State, and that there is therefore evidence tending to show that Guinness and Mahon may have committed an offence of carrying on an unlicensed banking business within the State contrary to Section 7 of the Central Bank Act, 1971 (as amended). INDEX Page 11.1 Introduction 11.2 Lack of co-operation on the parts of Guinness Mahon London and 143 Investec Bank (UK) Limited 143 11.3 Guinness Mahon London as parent of GMCT 144 11.4 GMCT accounts in Guinness Mahon London 144 11.5 Mr Bruce Ursell 144 11.6 The internal audit of 1989 145 11.7 Back-to-back loans 145 11.8 Mr Richard Fenhalls 146 11.9 Assessment of responsibility of Guinness Mahon London for the wrongdoing of Ansbacher 11.10 Inspectors’ recommendation 147 148 11.1 Introduction Guinness Mahon & Company Limited, London (‘Guinness Mahon London’) was established in 1873 as a sub-office of Guinness and Mahon. In 1923, Guinness Mahon London became the bank’s headquarters. In 1966, Guinness and Mahon became Guinness and Mahon (Ireland) Limited, which then became a wholly owned subsidiary of Guinness Mahon London. Guinness Mahon London is now a wholly owned subsidiary of Investec Bank (UK) Limited. 11.2 Lack of co-operation on the parts of Guinness Mahon London and Investec Bank (UK) Limited The Inspectors wrote to Investec on 1 March 2001, seeking information about Ansbacher pursuant to the Irish Companies legislation. On 9 March, a response was received from Mr Richard Vardy, company secretary of Investec, seeking evidence of the Inspectors’ authority in the English jurisdiction. The Inspectors accept that as a matter of strict procedure, their original letter ought to have been addressed to Guinness Mahon London. Accordingly, they wrote to Guinness Mahon London on 5 April 2001, and by letter of the same date, so informed M r Vardy. On 25 April 2001, Mr Vardy wrote again to the Inspectors, noting the position and saying that the letter to Guinness Mahon London had been passed to him. Speaking on behalf of both companies, Mr Vardy said that while neither company wished to obstruct the work of the Inspectors, they were concerned not to breach any obligations they might owe to customers or to third parties. M r Vardy concluded by regretting his inability to be o f further assistance. Finally, the Inspectors wrote again to Mr Vardy on 30 April, noting his concerns as to confidentiality, but explaining that the information they sought (as set out in their letter of 1 March) related, not to customers either of Investec or of Guinness Mahon London, but to the organisation and governance of Ansbacher, which at all relevant times was either a subsidiary of Guinness Mahon London, or a subsidiary of Guinness Mahon London’s subsidiary, Guinness and Mahon. The Inspectors concluded by suggesting a meeting between them and representatives of Investec. Mr Vardy responded finally to this letter on 5 June 2001 simply noting its contents and requesting the Inspectors to seek assistance from the UK Department of Trade and Industry. In the light of the refusal of co-operation from Investec and Guinness Mahon London, the Inspectors have been obliged to proceed to draw their conclusions without the benefit of the assistance of the two companies. 11.3 Guinness Mahon London as parent of GMCT In 1984, Guinness Mahon London acquired GMCT from Guinness and Mahon through its wholly owned subsidiary Guinness Mahon Overseas Investments Limited. It was sold again in 1988. 11.4 GMCT accounts in Guinness Mahon London GMCT had a number of accounts with Guinness Mahon London. Guinness and Mahon has given evidence to the effect that sterling lodgements made by Irish residents to their GMCT accounts were frequently made through Guinness Mahon London, either by the Irish resident giving the funds to M r Traynor, who lodged them to Guinness and M ahon’s nostro account in Guinness Mahon London, from where they were transferred to GMCT’s account in Guinness Mahon London, or by Irish residents transferring funds directly to GMCT’s account in Guinness Mahon London. 11.5 Mr Bruce Ursell Mr Bruce Ursell was a director both of Guinness Mahon London and of Guinness and Mahon during the 1980s. It is clear from numerous documents that he was aware that the Ansbacher deposits in Guinness and Mahon concealed funds beneficially owned by Irish residents. In a letter written to Mr Traynor on 17 October 1985 at the time of the latter’s resignation from Guinness and Mahon, Mr Ursell assures him that Guinness Mahon London would be agreeable to his moving temporarily into a vacant office in Guinness and Mahon ‘and having a computer terminal w ired up to tap into the Cayman Bureau The ‘Cayman Bureau’ was the computer set up specially to hold the coded accounts of the Irish residents whose funds made up the GMCT deposits. 11.6 The internal audit of 1989 In February 1989, Guinness Mahon London conducted an internal audit on Guinness and Mahon. The audit report concentrated particularly on Guinness and M ahon’s management and control of the GMCT— or, as they had by then become known, the Ansbacher— deposits. Commenting on the fact that the management of the deposits was in the sole charge of an associate director of Guinness and Mahon (Mr Padraig Collery), the report goes on to say: ‘the Associate Director, additionally, manages the related anonymous off-shore ‘customer ’ deposits, on behalf o f Ansbacher ... the ledger accounting records o f the Customer Deposits are maintained by the Bank on a ‘B ureau System ’ ... Thus the Ansbacher Deposits held on the B a n k ’s computer system are represented by the Customer Deposits held on the Bureau system. ’ The report explains in some detail the management of the account, and Mr Collery’s role therein, including the fact that payments to Ansbacher customers were made from the Ansbacher deposits held in Guinness and Mahon. It is clear that Guinness Mahon London knew the purpose of the bureau system. 11.7 Back-to-back loans Guinness and Mahon was required to report weekly to Guinness Mahon London on credit issues. From September 1979, Guinness and Mahon reported to an official of Guinness Mahon London after every executive directors’ meeting in which credit matters had been dealt with. Guinness and Mahon was required to seek sanction from Guinness Mahon London in respect of every property-backed loan greater than £100,000, and every non­ property-backed loan greater than £250,000. In this way, some of the Guinness and Mahon loans backed by Ansbacher deposits came before Guinness Mahon London for approval. Guinness Mahon London also was conversant with Guinness and M ahon’s practice of referring to loans backed with Ansbacher deposits as being ‘suitably’ or ‘adequately’ secured (or other similar terminology). This can be seen from the following examples: An internal memo of 1 May 1990 from Michael Whitmarsh to the Credit Committee entitled ‘G&M Dublin - John Byrne Group Connection’ commences ‘ 7he annual renewal fo r these fu lly adequate ’facilities was submitted to Credit Committee on the 24 April ... ’ The memo goes on to state that backing deposits are held at Guinness and Mahon in the name of Ansbacher. (see Appendix VIII(a)) Another memo dated 28 September 1989, same to same, and entitled 7. Turley connection - G&M D ublin’ says: ‘ The present limits to the Group are set out on page 1 o f the accompanying memoranda [sic] and total an exposure o f £450,000 and these are currently secured by ‘adequate’ deposits which are effectively under D ublin’s control. The Committee w ill be aware o f the background o f such security and the fa c t that, in certain cases, this may be withdrawn in the foreseeable future. ’ (see Appendix VIII(b)). Evidence was given on behalf of Guinness and Mahon to the effect that in the case of certain loans, where large sums in pounds sterling were transferred to Guinness and Mahon from Cayman trusts, the money was transmitted via Ansbacher’s seven-day deposit account in Guinness Mahon London, whence it was placed in Guinness and M ahon’s nostro account in the same bank. Guinness Mahon London itself provided loans that were backed by Cayman deposits. In relation to one of these, a loan to PV Doyle Hotels Limited, a memo dated 11 June 1984 from Mr Traynor to Mr Pat O ’Dwyer of Guinness and Mahon recites the fact of the loan and adds ‘G&M [Guinness and Mahon] has guaranteed the facility and is charging %% fo r the Guarantee. 11.8 The Guarantee is fo r cosmetic purposes. ’ (see Appendix VIII(c)). Mr Richard Fenhalls Mr Richard Dorian Fenhalls has at different times held the positions of Managing Director of Henry Ansbacher and Company, Managing Director of Guinness Mahon London, Chief Executive of the Guinness Mahon Group, director of Guinness and Mahon, director of Ansbacher (Cayman) Limited and non-executive director of Irish Intercontinental Bank (‘IIB’). During his time on the boards both of Guinness Mahon London and of Guinness and Mahon, Mr Fenhalls was well acquainted with Guinness and M ahon’s Cayman portfolio. An internal memo dated 18 December 1984 from Bruce Ursell to the directors of Guinness Mahon London refers to the ‘Cayman loan portfolio’ and says that it has been agreed, in view of the small size of the loan book, ‘to accept the assurances o f RD F [Richard Fenhalls] on the working methods a n d h is own look at the portfolio’. It is clear from a comment in the memo about M r Traynor that the reference is to loans from Guinness and Mahon backed by Ansbacher deposits. The memo goes on to say that no one has looked at the portfolio since ‘R D F ’s ’ visit eight months previously (see Appendix VIII(d)). 11.9 Assessment of responsibility of Guinness Mahon London for the wrongdoing of Ansbacher The Inspectors conclude that the fact that Guinness Mahon London permitted the maintenance of the memorandum accounts during the time that Guinness and Mahon was its subsidiary, the fact that it actively facilitated their continuation when M r Traynor left Guinness and Mahon, the fact that it facilitated the lodgement of funds of Irish residents to their Ansbacher accounts and the fact that it provided loan facilities to Irish residents which were secured by Ansbacher deposits, when taken together constitute evidence tending to show that Guinness Mahon London knowingly assisted Ansbacher in conducting its affairs so as to defraud a creditor of some of its clients, namely, the Revenue Commissioners, and that there is therefore evidence tending to show that the common law offence of conspiracy to defraud may have been committed, as well as the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the appropriate tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 11.10 Inspectors’ recommendation While understanding the issues of confidentiality that arise for a bank in relation to requests for information coming from outside the jurisdiction, the Inspectors nevertheless point out the obligations imposed by the Companies Acts upon persons who are or may be in possession of information concerning a company under investigation. At all relevant times, the Irish business of Ansbacher was conducted in or with the assistance of Guinness and Mahon, a subsidiary of Guinness Mahon London. The Inspectors take the view that Guinness Mahon London cannot distance itself from its Irish subsidiary in such a way as to refuse to provide information relating to the way in which it conducted its business with Ansbacher - which itself (as has already been pointed out) formed at all relevant times part of the Guinness Mahon Group structure. The Inspectors are of the view that those who wish to take the benefit and protection of the limited liability granted to companies by Irish law must respect the rules under which the limited liability system operates. In view, therefore, of the failure of Guinness Mahon London and Investec Bank (UK) Limited to cooperate with them, the Inspectors recommend that consideration should be given by the appropriate authorities as to whether an application should be made for disqualification orders, pursuant to Section 160(2) (e) of the Companies Act, 1990 in respect of each and every member of the boards of both companies. INDEX Page 12.1 Introducti on 151 12.2 The McAuliffe review 153 12.3 Moving of Ansbacher accounts to IIB 154 12.4 Disquiet of Ansbacher’s auditors 154 12.5 Mr Fenhalls’ growing concerns about M r Traynor 156 12.6 The Jennings-McAuliffe investigation and the discovery of the Hamilton Ross accounts 158 12.7 Implications of the Hamilton Ross discovery 159 12.8 Jennings and McAuliffe seek legal advice 161 12.9 Removal of Hamilton Ross from Ansbacher’s books 161 12.10 First appearance of Hamilton Ross in Ireland 162 12.11 Continuation of remaining Irish business 162 12.12 Concerns of First National Bank of Southern Africa 12.13 Assessment of the responsibility of Henry Ansbacher Holdings pic for the wrongdoing of Ansbacher 12.14 Unlicensed banking 12.1 Introduction As described earlier in the Report, M r Richard Fenhalls, former chief executive of the Guinness Mahon Group, had become chief executive of the Henry Ansbacher Group in 1985. In 1988, pursuant to his desire to build up an offshore banking group for Henry Ansbacher, he entered into negotiations with M r Traynor, M r Collins, Mr Furze and Mr Hart for the purchase of GMCT, which was by then owned by Chichester Investments Limited, a company of which they were the shareholders, and which, as shown above, had earlier purchased GMCT from Guinness and Mahon. The negotiations reached a successful conclusion, and in August 1988, Henry Ansbacher Holdings pic acquired a 75% interest in the Company at a price of £750,000 cash plus shares in Henry Ansbacher Holdings pic valued at £2.25 million. Following the share sale, Mr Traynor was appointed Chairman, GMCT’s name was changed to Ansbacher Limited on 29 August 1988, and the Company remained under that name until November 1992, when it became known as Cayman International Bank and Trust Company Limited. The Henry Ansbacher Group owned GMCT until 20 January 1993 when First National Bank of Southern Africa Limited purchased the entire Henry Ansbacher Group. Henry Ansbacher Holdings held the shares in GMCT only for a period of four months, at which time they were transferred to the Ansbacher Offshore Group in Guernsey as part of a group reorganisation. Solicitors for FirstRand (the present owners of Ansbacher) have told the Inspectors that, thereafter, responsibility for the offshore subsidiaries lay with the Ansbacher Offshore Group, senior management of which were based in Guernsey. The Inspectors are satisfied that this did not alter the reality of the situation, namely that responsibility for decisions taken in relation to GMCT rested at all times with London management. That this was so is clear from documentation provided to the Inspectors by Henry Ansbacher & Company of London, which includes extracts from minutes of board meetings, and meetings of the Audit and Compliance committees of Henry Ansbacher & Company Ltd and Henry Ansbacher Holdings Ltd. These extracts show that the meetings (which were held in the 1990s, and thus long after the transfer of the shares to Guernsey) frequently considered matters relating to Ansbacher (Cayman) Limited. Included in the same documentation are memos relating to Ansbacher (Cayman) Limited from Mr Fenhalls, written on Henry Ansbacher headed paper. A letter dated 5 February 1992 from Mr Fenhalls to Mr Fraser Jennings of Henry Ansbacher is also written on Henry Ansbacher notepaper, and deals exclusively with Cayman matters. Some extracts from that letter exemplify the matter (Inspectors’ emphasis): ‘The total cost o f your package, which is to be agreed, would be p a id fo r by the Cayman Islands, but w ill be prorated between time spent on Cayman Island work and the rest o f the Group; that is to say, when you are in London for your monthly Henry Ansbacher H oldinss vie Executive Committee meetings - this ultimately would be a London cost. ’ ‘A s you know, I have never conceived o f your role in the Cayman Islands as a permanent appointment. The whole issue behind sending, you out there was to understand the risk profile o f the organisation and the business and to put it right from an administrative and professional point o f view. ’ ‘ This may all seem a little trite to you in the light o f our conversations that what you were going to do was p u t in place in the Cayman Islands the exact replica o f what we do in London ... ’ 7 have said to Hugh that I have no idea how long the jo b you have been asked to do w ill take overall. M y real delight would be i f it could be done sooner rather than later, but I know that we have to get it done. ’ The Inspectors are satisfied therefore that their conclusions in this regard properly relate to Henry Ansbacher Holdings. The Inspectors have concluded in Chapter 5 that there is evidence tending to show that GMCT/Ansbacher was guilty of certain wrongdoing. The Inspectors now consider what, if any, responsibility should be borne by Henry Ansbacher Holdings pic for Ansbacher’s wrongdoing during the period 1988 - 1993. 12.2 The McAuliffe review Prior to Ansbacher's purchase of the company, Mr Kevin McAuliffe, the then financial director of the Ansbacher Offshore Group, visited Cayman to conduct a review. His brief was essentially to review the organisational structure, systems and controls within the company, and to comment on strengths and weaknesses. His review did not turn up any problems significant enough to prevent the acquisition. However, among the weaknesses identified by him, some are of note in the light of later events. Under the heading ‘General Systems/Controls ’ Mr McAuliffe notes that the receipt of telephone instructions by trust officers is not recorded on client files, nor confirmed in writing. Again, under the heading ‘Standard o f management o f companies/trusts’ he remarks that no trustee minutes are kept. This practice of non-minuting of trustee decisions facilitated the system described elsewhere, whereby Irish residents could withdraw funds from offshore trusts by means of a simple request to Mr Traynor in Dublin and underlines what the Inspectors have concluded was a sham trust structure in the manner of its operation. An investigation of the loan book was undertaken by KPMG Peat Marwick. M r John Button, another Henry Ansbacher director, wished to have further investigations undertaken, but was dissuaded from this ambition by M r Fenhalls. According to a corporate history document prepared for the Inspectors by Ansbacher (Cayman) Limited in July 2001, Mr Fenhalls acted in this way because ‘in common with most bankers at the time, he believed that a bank could only fa il i f its loans collapsed (i.e. through non repayment fo r whatever reason) Corporate transactions were not seen as a likely cause o f failure. Here GM CT had a large deposit base (largely placed in the money markets) but, importantly, relatively little advanced in commercial loans. Having satisfied him self about the loan book, there seemed to him little needfor any more comprehensive due diligence ’. Mr Fenhalls himself gave evidence to the Inspectors to the same effect. The investigations found nothing to cause any concern in relation to the Irish business of GMCT. 12.3 Moving of Ansbacher accounts to IIB Over the years that followed, Mr Fenhalls became increasingly worried about the credit­ worthiness of Guinness and Mahon, and he told the Inspectors that by 1991 he had come to the view that it was unsafe for Ansbacher to continue to place large group deposits with it. He discussed the position with M r Traynor, who, according to M r Fenhalls, was reluctant at first to close the accounts. Finally, however, on the instructions of Mr Fenhalls he did so, and opened new accounts with IIB. M r Fenhalls had first paved the way with that bank where, of course, he was well known, having formerly been a member of its board. Ansbacher thus became a customer of IIB, holding accounts in the same way as it had held them in Guinness and Mahon, namely, on behalf of its clients. As outlined earlier in this Report, memorandum accounts continued to be maintained by Mr Collery in the offices of CRH, and everything continued much as before. 12.4 Disquiet of Ansbacher’s auditors Around the same time, more serious concerns began to trouble Ansbacher’s management. At a board meeting on 30 October 1991, it was noted ‘The auditors o f Ansbacher Limited, Cayman Islands, had expressed disquiet on various outstanding matters in regard to the movement o f funds on the Dublin accounts held in the Cayman Islands. M r Fenhalls Ansbacher remained a customer of Guinness and Mahon to a small extent even after 1991, with some cash-backed loan accounts remaining on the books until Guinness and Mahon’s takeover by Irish Permanent in 1994. requested M r Jennings to pursue this matter during the latter's discussions next week with M r Traynor. ’ Mr Jennings carried out this commission, and reported back to M r Fenhalls in a memo dated 12 November 1991, in which he expresses concern on a number of fronts. From this memo it is clear that the following matters had been raised with M r Traynor: the concern that he was the sole signature on the accounts and concerns about instructions on the accounts. Mr Traynor had dealt with the first concern by saying that it was ‘fatuous’, as the individuals concerned were his clients, and that as a matter of practicality there was nobody else available to perform the task. In relation to the second concern, M r Traynor said that it was unfounded 'g iven the longstanding and personal nature o f the relationships involved’. Mr Jennings concludes as follows: ‘On a broader note, Ife e l we must accept and respect the secrecy attached to the offshore deposits ...but in doing so recognise the trust and responsibility empowered to offshore’s senior executives to ensure that their activities are at all times in compliance with both the relevant regulating bodies and the bank’s own rules o f conduct. ’ (See Appendix IX(a)). Mr Fenhalls took a high tone in response to any implied criticism of Mr Traynor's conduct, saying that he accepts Mr Traynor's explanations and continuing: 7 fin d it inconceivable to make the assumption that the Chairman o f Ireland's largest Company, director o f a number o f prestigious Irish companies, adviser to the good and great in Dublin and approved by the Central Bank o f Ireland to be a f i t and proper person to run a Bank would be conducting improper, illegal or clandestine activities contrary to the law. What I suggest we do to p u t an end to the situation is as follows: - I propose that you and John Button visit Des, go through what he does, how he does it, and we advise the Audit Committee and the Auditors thereafter that we are satisfied with the overall position (if we are) ’. (see Appendix IX(b)). 12.5 Mr Fenhalls’ growing concerns about Mr Traynor Throughout the year that ensued, concerns in relation to the Dublin accounts were raised periodically at meetings of the board of directors and of the audit and compliance committees, usually with the comment that the matter was being looked into. Extracts from the relevant minutes can be found at Appendix IX(c). It would appear that the growing concerns had considerably altered Mr Fenhalls’ view of Mr Traynor’s conduct, because in a draft internal memo dated 16 September 1992, Mr Fenhalls, referring to management restructuring, and the position of Mr Traynor within the company, says: ‘With regard to Des Traynor, my view is that the sort o f business that he can usefully introduce to the Cayman Islands is more than outweighed by the regulatory risks involved o f his conducting a pseudo banking business in Dublin ... . . . F o r so m e tim e n ow we have been concerned about the regulatory aspects o f someone physically present in Dublin maintaining accounts in the Cayman Islands fo r the benefit o f Irish residents. ’ [Inspectors’ emphasis] Mr Fenhalls goes on to say that he believes the time has come to ‘unwind’ the Dublin accounts and place them with a bank of Mr Traynor’s choice. In this memo, Mr Fenhalls is not speaking about the Hamilton Ross business described later in this chapter, which coincidentally was revealed to him on that very day. He told the Inspectors that he was satisfied that at the time he wrote the draft memo, he had not yet received the Jennings/McAuliffe fax of the same date (see below ). He told the Inspectors that the memo was a record of ‘an increasingly growing concern ’ explaining it as follows: ‘You know the first time someone says no to you there is not a problem you accept it, you go through this and then factors become more prevalent and you have more internal memos from colleagues, you have more questions raised, inevitably this is going to raise a concern. ’ Asked by the Inspectors what factors influenced him, prior to the revelation of the Hamilton Ross business, in forming the view that the Dublin accounts should be unwound, Mr Fenhalls replied: 7 suspect, but do not know it was again that they were never a large income producer. There had been quite a lot o f ongoing operational difficulties. There were [sic] the management hassle o f having one signature as opposed to two. A ll these blind trusts where Traynor was dealing with them on his own. Ultimately things ju s t are not worth the managerial hassle and I think this was the easiest way in retrospect to bring it all to a conclusion. ’ The Inspectors pointed out to Mr Fenhalls that one of the concerns that appeared to be reflected in the document was that of Irish Exchange Control. The following exchange then took place, commencing with M r Fenhalls' reply: ‘A. Yes, but equally well i f Irish residents were drawing cash from offshore trusts I think it is a perfectly proper question to ask, you know, ‘I s this in breach o f exchange control and is this absolutely acceptable in central banking terms? ’ and I was consistently assured that it was. Q By M r Traynor? A Yes, o f course. I don't know who else could have assured me. Q This was what I was curious to fin d out, did you, at any stage, seek legal advice from lawyers in Ireland as to what was the position under Irish exchange control laws? A No. Q Or any banking advice? A I don't see what banking advice I could have taken. Frankly, this goes back to the extent and level o f enquiry that you do in relation to your senior and trusted colleagues. It is very easy fo r you to say in hindsight A,B, C ought to have been done. Do not lose sight o f the fa c t that this was a senior respected figure who knew the banking regulations better than I did and was telling me that this was perfectly acceptable. Q A s a matter o f fa c t then no other advice or assurance was sought other than what M r Traynor had said? A 12.6 Absolutely. ’ The Jennings-McAuliffe investigation and the discovery of the Hamilton Ross accounts Meanwhile, back in 1989, the Henry Ansbacher Group had purchased another Cayman company, CITCO. Henry Ansbacher then set about merging its two Cayman businesses. The proposed merger apparently met with some resistance, particularly from M r John Furze. This difficulty, together with a growing realisation of the autonomy enjoyed by Mr Traynor in his conduct of the Irish business of Ansbacher, prompted M r Fenhalls to second Mr Fraser Jennings and Mr Kevin McAuliffe to Cayman in early 1992. As part of his secondment, M r Jennings was made a managing director of Ansbacher. At that time, the main concern in relation to Mr Traynor’s activities was one of internal control. Accordingly, M r Jennings undertook an investigation of the business carried out by Mr Traynor. On 16 September 1992, Messrs Jennings and McAuliffe faxed M r Fenhalls and Mr Button from Cayman to relate the discovery of a matter hitherto unknown to the English management (see Appendix IX(d)). Having asked Mr Furze why it was not possible to ensure that transactions recorded in the memorandum accounts in Dublin would be entered in the books of Ansbacher more speedily, Mr McAuliffe had been told that there were approximately 250 transactions per month on the memorandum accounts, and that the majority were passed through a Cayman company called Hamilton Ross Limited. Mr Furze described Hamilton Ross’s business as being that of receiving deposits in Ireland from clients, and then banking them in IIB ‘on behalf o f AL [Ansbacher Limited] ’. Upon further investigation by Messrs Jennings and McAuliffe, it emerged that Hamilton Ross was a Cayman company formed in 1981, whose directors were M r Furze and two others. Mr Furze was the registered owner of the majority shareholding. The company had no reserves, and appeared to be used exclusively for the purpose of the collection and onward transmission of deposits to Ansbacher. An examination of the books of Ansbacher showed twenty-nine deposit accounts in the name of Hamilton Ross, each of which showed a numeric sub-designation. These were funded from a similar number of ‘suspense’ accounts, the majority of which carried no sub-designation. M r Furze said that once a quarter, statements of these accounts were printed in Ireland and were given to the underlying clients. Messrs Jennings and McAuliffe noted that Hamilton Ross did not have a bank mandate for the operation of its accounts with Ansbacher. The two men also found another company with similar bookkeeping but with a lesser number of sub-accounts. This entity was Poinciana Fund Limited. The remaining Irish business appeared to them to consist of individual deposits sourced in Ireland and placed by managed companies and trusts with Ansbacher. 12.7 Implications of the Hamilton Ross discovery In the course of his evidence to the Inspectors, Mr Fenhalls impressed upon them that this was shocking news for Ansbacher management. However, from what has already been written, it will be clear that management had been concerned about the possible legal implications of the Irish business for at least a year before. It would seem that what troubled Mr Fenhalls most in relation to the Hamilton Ross business was the fact that the identities of Hamilton Ross’s clients were unknown to Ansbacher, and it was this, coupled with what he saw as a betrayal of trust on the part of Mr Traynor, that shocked him, rather than the regulatory aspects of the matter. It is clear, however, that Mr Jennings and Mr McAuliffe saw the wider picture. They were greatly disturbed by their findings concerning Hamilton Ross and Poinciana, and in their fax to Mr Fenhalls, summarised the areas which caused them concern as follows: • ‘Carrying out a deposit taking activity in Eire without a licence. • Trading within Eire without declaring this to the Revenue. • Possible breach o f Eire Exchange Control • Assisting Eire residents to avoid Eire tax. • Failure to comply with the M oney laundering regulations. • Possible risk o f error on money transfer between the clients and AL. • Risks associated with the absence o f dual controls ’ They stressed that it was necessary to take urgent action in order to ensure the speedy termination of the Hamilton Ross and Poinciana business. They also felt that consideration should be given to the desirability of keeping on any remaining Irish business. A note in Mr Fenhall’s handwriting, dated 17 September, appears on the face of this fax. It says: ‘JMB [Mr John Button] w ill handle: fin d out facts: w ill get o ff books by end September. Will advise i f not: J D T ’s position agreed to be untenable and he would have to go in due course. RDF. ’ Despite the apparently robust reaction indicated by the above handwritten note, a responding fax sent to Messrs Jennings and McAuliffe by Mr Fenhalls’ colleague, Mr Button, on the following day was more measured in its tone. Mr Button had by then spoken to M r Traynor, and had been somewhat reassured. Among other things, Mr Traynor said he would be happy to remove the deposits from Ansbacher by the end of September, if Ansbacher so wished. He also assured M r Button that Hamilton Ross was not taking deposits as principal, but was placing them as fiduciary for individual clients with Ansbacher. The Inspectors have found it to be a remarkable feature of the Ansbacher management’s investigation of the Irish business that the alarm and concern induced by every fresh indication of what was going on was always allayed by a conversation with Mr Traynor. London management appeared to accept with very little question Mr Traynor’s assurances that no laws were being or had been broken, and perhaps this is yet again a measure of the confidence and trust that Mr Traynor inspired in all who met him. In the course of Mr Fenhalls’ evidence to the Inspectors, it was put to him that every so often, he would approach M r Traynor with his concerns, and would come away reassured. M r Fenhalls agreed that this was so, but added, significantly: ‘the fa c t that I kept on going back to Traynor and asking these questions thus indicate that I am becoming increasingly more concerned. ’ It is also remarkable, in the Inspectors’ view, that management focussed all its energy on the Hamilton Ross and Poinciana business, but ignored the remainder o f the Irish business, in spite of the fact that Mr Jennings had strongly recommended reconsideration of the maintenance of that business. 12.8 Jennings and McAuliffe seek legal advice Messrs Jennings and McAuliffe had also taken the step of seeking legal advice on the matter in the Cayman Islands. A file note of Mr Tim Ridley, an attorney with the firm of Maples & Calder, recounts in informal style the visit of the two men to his office at short notice on 16 September 1992 and comments that the matter was ‘extremely convoluted, in the best tradition o f the Irish Gnomes’’. M r Ridley found himself unable without more information to say whether Hamilton Ross was carrying on an unlicensed banking business, but he was quite satisfied that what was going on was extremely bad banking practice. He thought ‘that any banking regulator would, throw a f i t i f he knew about it. ’ He gave it as his opinion that the business was not an appropriate one for Ansbacher, and recommended that they should get rid of it (see Appendix IX(e)). 12.9 Removal of Hamilton Ross from Ansbacher’s books There appears to have been a rumour going around at this time that Mr Traynor and Mr Furze were going to leave because of the decision to drop the Hamilton Ross business. A handwritten file note dated 21 September 1992 and signed by Mr Fenhalls notes a discussion with M r Jennings about the matter, in which M r Jennings told him he had no knowledge of such a move. He also told Mr Fenhalls that Hamilton Ross belonged to Mr Traynor, and confirmed that it would be off Ansbacher’s books by 30 September 1992. Indeed, minutes of a meeting of the combined Audit and Compliance committees of Henry Ansbacher Holdings pic and Henry Ansbacher & Company Limited on 5 October 1992 show that M r Button advised the meeting that the Hamilton Ross and Poinciana accounts had now been closed. 12.10 First appearance of Hamilton Ross in Ireland Back in Ireland, Mr Traynor gave instructions to IIB, the effect of which was that the clients’ funds which had been in an Ansbacher pooled account in IIB, and held in an account in the name of Hamilton Ross in Ansbacher in Cayman, now ceased to be held in any Ansbacher account either in Ireland or in Cayman. Instead, they were held on the clients’ behalf in IIB in an account in the name of Hamilton Ross Limited. From then on, those people who had hitherto been clients of Ansbacher became simply clients of Hamilton Ross. Statements of the memorandum accounts continued to be printed on Ansbacher headed paper until January 1993, but M r Collery has explained to the Inspectors that this was because he was using up existing stationery until new stationery was printed. Mr Collery is clear on one vital point, namely, that from 30 September 1992 these statements were no longer sent for reconciliation to Ansbacher, instead, they were sent to Hamilton Ross at its Cayman address. 12.11 Continuation of remaining Irish business The remainder of the Irish business carried on as before. In a management letter signed on 30 October, 1992, KPMG Peat Marwick, auditors to Ansbacher, identified what they referred to as the ‘Dublin accounts’ as an area of weakness on the Ansbacher books. They described these accounts as follows: ‘There is a book o f customer accounts ( ‘D ublin accounts’) which are operated and controlled in Dublin, Ireland by the Chairman o f Ansbacher Limited. The Dublin accounts are operated outside the regular internal control environment o f Ansbacher Limited. The documentation supporting the balances and transactions through these accounts is weak and in general transactions are initiated verbally by the beneficiaries o f the trusts which own the account holding companies. The only control over these accounts has been that a managing director has prepared statements fo r the operating companies and these have been approved annually by the trust beneficiaries. Accordingly any irregularities in the operation o f these accounts could remain undetected fo r up to twelve months. We have seen no form al consideration o f the regulatory and taxation consequences o f the Company operating these accounts from Dublin. ’ The auditors recommended: ‘ The Directors should consider the desirability o f operating these accounts outside the regular internal controls o f the company and obtain advice on the possible consequences o f carrying on business in Dublin ’ (see Appendix IX(f)). In the view of the Inspectors, the above letter ought to have caused alarm bells to ring in the ears of London management, coming as it did so soon after the Hamilton Ross debacle, and using phraseology reminiscent of the Jennings-McAuliffe fax. But nothing was done. The last memorandum account was not closed until after the sale to First National Bank of Southern Africa. 12.12 Concerns of First National Bank of Southern Africa In the same month of October 1992, Mr Fenhalls, together with M r Brian Lavelle of the First National Bank of Southern Africa met with Mr Traynor to discuss the whole question of the Dublin accounts. At that meeting, the following issues were raised: ‘To what extent was there a permanent establishment created in Dublin and to what extent was a Banking licence needed to conduct the business in the manner in which it was conducted, particularly as the m ind and management o f the accounts was in Dublin? ’ Mr Fenhalls indicated that he did not think it was banking business, but noted in a subsequent memo that the ‘regulatory consequences’ of the way in which the Dublin accounts were managed remained to be dealt with (see Appendix IX(g)). 12.13 Assessment of the responsibility of Henry Ansbacher Holdings pic for the wrongdoing of Ansbacher The Inspectors are of the view that Ansbacher’s London management was on notice of the possible regulatory concerns relating to the Irish accounts at least from October 1991. In particular, they were aware of the possibility that an unlicensed banking business was being carried on in Ireland. The Inspectors note that M r Fenhalls in his evidence assured them that if he had known that regulatory breaches had occurred, he would have taken immediate action to put an end to them. However, the Inspectors note the failure of Henry Ansbacher Holdings pic to obtain advice from anyone other than Mr Traynor on the regulatory implications of the Dublin accounts, which, the Inspectors conclude, permitted the continuation of those accounts (excluding the Hamilton Ross and Poinciana accounts) notwithstanding warnings from Messrs Jennings and McAuliffe Ansbacher’s auditors. and The Inspectors conclude that Ansbacher’s London management ought to have taken legal advice on the issue, and ought not to have accepted the assurances of M r Traynor that the matter was not of concern. They are satisfied that if London management had sought and received legal advice to that effect, the unlicensed banking business would have ceased at a date earlier than it did. 12.14 Unlicensed banking The Inspectors therefore conclude that, insofar as the evidence tends to show the continuation of an unlicensed banking business in Ireland after October 1991, Ansbacher’s London management bears responsibility. FIRST NATIONAL BANK OF SOUTHERN AFRICA LIMITED INDEX Page 13.1 Introduction 166 13.2 Death of Mr Traynor 166 13.3 Resignation of Mr Furze 166 13.4 Winding down of Ansbacher’s Irish business 167 FIRST NATIONAL BANK OF SOUTHERN AFRICA LIMITED 13.1 Introduction On 20 January 1993, the entire Henry Ansbacher Group was purchased by First National Bank of Southern Africa Limited (‘FNBSA’). The Cayman Island subsidiary assumed its present name of Ansbacher (Cayman) Limited in September 1994. FNBSA remained the parent company of the Cayman company until 1998, when FirstRand, the present owner, acquired its shares. FNBSA has co-operated with the Inspectors by making available to them documentary and oral evidence. The Inspectors commend this co-operation. The Irish business of Ansbacher (Cayman) Ltd having concluded in 1996, the Inspectors have considered the question of what, if any responsibility FNBSA should bear for the Company’s wrongdoing from 1993 to 1996. During that period, a number of events took place. 13.2 Death of Mr Traynor In April 1993, Mr Traynor resigned as Chairman and became a non-executive director, which position he held until his death in 1994. After Mr Traynor’s death, Mr Collery took over his role and at the request of Ansbacher (Cayman) Ltd, began the winding down of operations in Ireland. Mr Collery had never been an employee of the Cayman bank, but had, it appears, been paid personally by Mr Traynor. However, following Mr Traynor’s death, he was paid a retainer by the Company to ‘ensure an orderly transition in respect o f /Ansbacher] ’s dealings with Irish clients ’ (see Appendix 11(c)). 13.3 Resignation of Mr Furze In April 1995, two significant changes occurred: Mr Furze resigned as executive director and Mr Collins became a non-executive director, which position he held until his resignation on 31 October 2000 13.4 Winding down of Ansbacher’s Irish business The Inspectors accept that the winding down of the Irish business began shortly after the takeover by FNBSA. Although FNBSA permitted Mr Traynor and Mr Furze to continue to serve on the board of Ansbacher (Cayman) Ltd - in Mr Traynor’s case until his death, and in Mr Furze’s case until 1995 - the Inspectors note that this was motivated by a wish to protect the Company from adverse reaction to the resignation or dismissal of the Chairman and an executive director. All of the Irish business was ultimately wound up prior to the commencement of the investigation of these matters undertaken by the McCracken Tribunal. Taking all the circumstances into account therefore, the Inspectors conclude that it would be unfair to categorise FNBSA as having equal responsibility with others for the conduct of the Company’s unlicensed banking business. PART IV ASSISTING ANSBACHER (CAYMAN) LIMITED 168 Introduction to Part IV The Order of 22 September 1999 appointing the Inspectors obliges them, inter alia, to identify as far as possible all of the parties who were either officers (including shadow directors) or agents of the Company, clients of the Company or who otherwise assisted in the carrying out of the business at the relevant time. This Part of the Report considers those parties who assisted in the carrying out of the business at the relevant time. The Inspectors have concluded that a wide range of persons and bodies assisted the carrying out of the Ansbacher business at different times and indeed that without their help the business could not have been continued. However, the Inspectors are conscious that some of the parties who helped Ansbacher in the carrying out of its Irish business may have done so without knowing the true nature of the Ansbacher business or the wrongdoing committed by Ansbacher. Accordingly, in an effort to be fair to all parties, the Inspectors, in reporting on the parties who assisted, have distinguished between those parties who may be said to have knowingly assisted and those parties who assisted without knowledge of the true nature of the Ansbacher business or the wrongdoing being committed by Ansbacher. Where the party providing assistance to Ansbacher is a body corporate, the Inspectors have been conscious of the fact that special legal rules apply when seeking to ascertain whether a body corporate (as opposed to an individual officer, agent or employee of the corporation) may be said to have acquired knowledge.1 See, inter alia, the decision of Viscount Haldane in Lennard’s Carrying Company Limited v. Asiatic Petroleum Company Limited [1915] AC 705; the decision of Denning L.J. in H.L. Bolton (Engineering) Company Limited v. T.J. Graham & Sons Limited [1956] 1 QB 159; the decision of the House of Lords in Tesco v. Nattrass [1972] AC 153; the decision of Lord Hoffmann in Meridian Global Funds Management Asia Limited v. Securities Commission [1995] 3 All ER 918 and the decision of both the High Court and Supreme Court in the Attorney General (SPUC) v. Open Door Counselling Limited and the Dublin Well Woman Centre Limited [1988] IR 593. INDEX 14.1 Introduction Page 171 14.2 Conclusions 171 14.3 Assisting to defraud 171 14.4 Assisting the carrying on of an unlicensed banking business 172 14.1 Introduction As related in Chapter 10, the Inspectors have found evidence tending to show that Guinness and Mahon was responsible for the wrongdoing of Ansbacher (then known as GMCT) during the time when it was Guinness and M ahon’s subsidiary, that is, between 1971 and 1984. There is, however, another aspect of the relationship between Ansbacher and Guinness and Mahon to be considered. This chapter relates to whether or not Guinness and Mahon assisted GMCT in the period after it ceased to be its subsidiary. GMCT continued to conduct its Irish business from the premises of Guinness and Mahon until the departure of Mr Traynor in 1986. Even after that date, Guinness and Mahon continued to maintain the Ansbacher accounts upon its books. This continued until the accounts were moved to IIB in 1991. 14.2 Conclusions Up to 1989, when the memorandum accounts were moved to Mr Traynor’s office at 42 Fitzwilliam Square, Guinness and Mahon continued to conceal the identity of Ansbacher’s clients, through the use of the memorandum accounts, and continued to provide staff and technical facilities for keeping Ansbacher’s Irish accounts and for processing its Irish customer statements. From 1989 to 1991, when the Ansbacher accounts were transferred to IIB, Guinness and Mahon concealed the fact that accounts in the name of Ansbacher contained funds beneficially owned by Irish clients, concealed the nature of the security in bank documentation when a loan was secured on an Ansbacher deposit and facilitated Irish residents in making withdrawals from and lodgements to their Ansbacher accounts 14.3 Assisting to defraud The Inspectors have therefore concluded that from 1971 to 1991, there is evidence tending to show that Guinness and Mahon knowingly assisted Ansbacher to conduct its affairs with intent to defraud the Revenue Commissioners and was knowingly a party to the carrying on of the business of Ansbacher with that intent. 14.4 Assisting the carrying on of an unlicensed banking business The Inspectors have also concluded that the concealment of the fact that accounts in the name of Ansbacher contained funds beneficially owned by Irish clients and the facilitation of Irish residents in making withdrawals from and lodgements to their Ansbacher accounts from 1984 to 1991 constitute evidence tending to show that Guinness and Mahon aided and abetted Ansbacher to carry on a banking business in the State without the licence required by Section 7 of the Central Bank Act, 1971 (as amended). This means that there is also evidence tending to show that Guinness and Mahon was during that time an accessory to the carrying on of Ansbacher’s unlicensed banking business within the State, and that there is therefore evidence tending to show that that Guinness and Mahon may have committed an offence of carrying on an unlicensed banking business within the State contrary to section 7 of the Central Bank Act, 1971 (as amended). CHAPTER 15 ASSISTANCE PROVIDED BY CRH PLC INDEX Introduction Page 175 Mr Traynor’s relationship with CRH 175 The nature and extent of the assistance afforded by CRH 177 M r Traynor’s use of CRH employees for Ansbacher business 177 42 Fitzwilliam Square 177 Incoming post for Ansbacher 178 Preparation of Ansbacher statements 178 Lodgements to Ansbacher accounts 179 Withdrawals from Ansbacher accounts 179 W ork of Mr Padraig Collery on CRH premises 181 W ork of Mr John Furze on CRH premises 181 Ansbacher letterhead 181 173 15.13 Visits of Henry Ansbacher executives to 42 Fitzwilliam Square 182 15.14 After M r Traynor’s death 182 15.15 Knowing or unknowing assistance? 183 15.16 The range and duration of the activities carried out on CRH premises 183 15.17 Transparency of conduct of Ansbacher business at 42 Fitzwilliam Square 183 15.18 CRH directors as clients of Ansbacher 184 15.19 M r James Culliton 184 15.20 Mr Anthony Barry 184 15.21 The location of the Chairman’s office 187 15.22 No knowledge of the CRH Board 187 15.23 No collective knowledge 187 15.24 Absence of knowledge on the part of many 188 15.25 Trust in M r Traynor 188 15.26 Conclusion 188 15.1 Introduction Mr Traynor was appointed chairman of CRH Pic in 1987 and remained as such until his death in 1994. From some time in 1989, the Irish business of Ansbacher was conducted from the premises of CRH, making use of CRH’s facilities. In this chapter, the Inspectors examine the relationship between Mr Traynor and CRH, identify the nature and extent of the assistance afforded to Ansbacher by CRH and question whether that assistance can be said to have been knowingly provided by CRH. 15.2 Mr Traynor’s relationship with CRH Prior to 1970, Mr Traynor had been a non-executive director of Irish Cement Limited. In 1970, Irish Cement Limited and Roadstone Limited merged to form the company now known as CRH. Mr Traynor became a non-executive director of CRH from the date of its formation. From 1973 until 1987, Mr Michael Dargan was Chairman of CRH. At a board meeting of the company on 9 April 1986, Mr Dargan announced his intention to resign as Chairman at the AGM in 1987. At the same meeting, Mr Traynor was appointed Deputy Chairman with immediate effect. This was tantamount to being appointed Chairman designate. On 13 May 1987, Mr Dargan formally tendered his resignation as Chairman and by unanimous resolution Mr Traynor was appointed in his stead, with effect from the end of that meeting. Prior to his appointment as Deputy Chairman and then as Chairman, Mr Traynor had been an active member of the board of CRH. He attended board meetings regularly and was active on the board’s various sub-committees. From the time of his appointment as chairman until his death in 1994, he was a continuous member of the Acquisitions Committee, the Finance Committee and the Standing Orders/Chairman’s Advisory Committee for the years ending 30 June 1991, 1992, 1993 and for the year of his death. He was also a member of the Remuneration Committee.2 During Mr Traynor’s time with CRH, it always ranked in the top five Irish companies, holding the number one position in three years, 1980, 1989 and 1990.3 In his period as chairman, CRH’s turnover increased from €916.2m to €2,064.8 m (2.25 times) and market capitalisation increased from €433.26 m to €1,584.63 m (3 .75 times). By the time Mr Traynor became chairman of CRH, he had apparently divested himself of all outside executive functions. Accordingly, he had no place of work other than the office provided to him by CRH. The Chairman’s office was originally situated at 19 Lower Pembroke Street, Dublin, but moved to 42 Fitzwilliam Square Dublin in 1988. From that time until the time of his death, 42 Fitzwilliam Square was Mr Traynor’s only place of work. He worked there full time. The board of CRH knew that Mr Traynor had other interests and that he used the office and facilities provided to him by CRH to pursue those other interests. Amongst those other interests was Mr Traynor’s involvement in banking and, in particular, in the Cayman Islands subsidiary of Guinness and Mahon. Mr Anthony Barry was the chief executive of CRH from 1988 until Mr Traynor’s death in 1994 and succeeded him as Chairman of the company. Mr Barry told the Inspectors that it was not unusual for a major corporation wishing to have the services of a full time Chairman to make office and secretarial facilities available to the chairman to enable him pursue his other interests. He also told the Inspectors that he was aware of Mr Traynor’s continuing interest in banking and in particular in the Guinness and Mahon subsidiary in the Cayman Islands. At a later stage, he learned that ‘Ansbacher had bought the business'. Mr Patrick Molloy, the current Chairman of CRH, confirmed to the Inspectors that, based on inquiries he had made of directors at the time, it was known that Mr Traynor had some ongoing involvement with Guinness and Mahon / Ansbacher. Mr Information supplied by Gerrard Scallan & O ’Brien Solicitors. Ranking is assessed by reference to market capitalisation Traynor attended at the CRH offices daily arriving early in the morning before most of the other staff and leaving usually some time around mid afternoon. Approximately two days a week would have been spent on CRH business with the balance of the week being spent pursuing his other interests 15.3 The nature and extent of the assistance afforded by CRH In addition to providing Mr Traynor with an office that enabled him to carry out his other activities, including his interests in offshore banking, CRH provided other facilities to Mr Traynor. His long time secretary in Guinness and Mahon, Ms. Joan Williams, became an employee of CRH. 15.4 Mr Traynor’s use of CRH employees for Ansbacher business As an employee of CRH, Ms Williams became an important functionary of the Ansbacher business, enjoying a significant level of delegated authority to conduct its affairs. Mr Traynor also made use of the services of other CRH employees for the purpose of carrying on the Ansbacher business. In particular, he made use of the services of the caretaker of 42 Fitzwilliam Square and the driver provided to him by CRH. 15.5 42 Fitzwilliam Square The office provided by CRH to Mr Traynor became the centre of the Ansbacher business in Ireland. As will be detailed below, much of the ordinary routine of banking occurred at these offices. A striking feature of this routine activity is that little attempt was made to conceal it from persons not directly involved. To better understand the transparency of this activity, it is worth saying something of the layout of the offices at 42 Fitzwilliam Square. The offices were in a Georgian building. The front door worked on a monitor, which could be operated by a number of people in the building. At ground floor level was a reception area and a room occasionally occupied by the caretaker of the premises. The Chairman’s office was on the first floor. Adjacent to his office was an office occupied by his secretary, Ms Joan Williams, and the secretary to the Company Secretary (‘the other secretary’). There was also a boardroom on the premises. The upper floors housed the company’s secretarial department, its registry and the insurance departments. 15.6 Incoming post for Ansbacher The day-to-day routine of the office was unexceptional. Typically, the caretaker would open the premises at approximately 7.45 am. Mr Traynor was usually one of the First to arrive thereafter. The incoming post for the office would arrive some time between 9.00 a.m. and 10.00 am. The caretaker would usually sort the post and leave it in bundles on a table in the hallway on the ground floor. The bundles were organised by reference to the addressee of the letters. The caretaker confirmed to the Inspectors that letters addressed to ‘Guinness and Mahon’ and ‘Ansbacher’ arrived at 42 Fitzwilliam Square but he described the volume of the latter category of letters as very small. He knew that such letters were for the attention of Mr Traynor. Such incoming post for Ansbacher appears to have included bank statements from Guinness and Mahon. Thus, whilst the volume of incoming post addressed to GMCT or Ansbacher might have been small no attempt was made to treat it any differently from other incoming post and it was left on the table in the hall where it might be seen by anyone passing. 15.7 Preparation of Ansbacher statements The offices at Fitzwilliam Square were also used for the preparation of statements for those clients who had memorandum accounts. The task was a cumbersome one. Mr Traynor would have the statement bearing the GMCT or Ansbacher name and the code number printed from a computer, which was situated in his office where Mr Collery visited to maintain the records on it. Mr Traynor would use a ruler to tear off that portion of the statement containing the GMCT/Ansbacher name and the code number. He would then pass the remainder of the statement containing only a set of Figures to Ms Williams and would tell her the name oF the person to whom the statement related. It was her job then to ensure that each statement dealt with in this manner was sent ultimately to the person to whom the statement related. She devised a system oF attaching loose pieces oF paper to each statement with the name oF the person to whom the statement related written on the loose piece oF paper. When putting the statement in an envelope she removed the loose piece oF paper. The statement was accompanied by nothing more than a ‘ With Compliments ’ slip From Mr Traynor. The envelope was then addressed to the person whose statement it contained and sent out with the ordinary CRH post. This system of preparing statements for clients occurred on a three-monthly basis. 15.8 Lodgements to Ansbacher accounts The CRH facilities were also used to enable clients make lodgements to their Ansbacher accounts. The Inspectors have evidence of clients calling to 42 Fitzwilliam Square for the purpose of giving Mr Traynor cheques with a view to having those cheques lodged to their Ansbacher account. Mr Traynor would then entrust the cheque to Ms Williams and request that she lodge the cheque to the GMCT or Ansbacher account at either Guinness and Mahon or IIB, depending upon the period during which the lodgement was being made. Lodgements to Guinness and Mahon were dealt somewhat less formally than lodgements to IIB. Lodgements to Guinness and Mahon might be accompanied merely by a ‘With Compliments’ slip bearing some handwritten note, whereas lodgements to IIB were always accompanied by a covering letter typed by Ms Williams. In the ordinary way either the caretaker or Mr Traynor’s driver would be asked to deliver the envelope or envelopes to either Guinness and Mahon or IIB. 15.9 Withdrawals from Ansbacher accounts Withdrawals from the accounts were also effected making use of CRH facilities. Mr Traynor would give the essential instructions to Ms Williams. He would inform her of the amount of the withdrawal and the account from which it was to be debited. He would tell her whether or not the withdrawal was to be in cash or by way of a cheque or draft. If the withdrawal were to be by way of a cheque he would inform her as to the payee of the cheque being either the account holder or some third party to whom the account holder wished to make a payment. Ms Williams would then prepare a letter of instruction to either Guinness and Mahon or IIB and a copy of that letter would go to Mr Padraig Collery so as to ensure that Mr Collery knew to debit the memorandum account of the individual client. The caretaker or Mr Traynor’s driver would be asked to deliver the letter of instruction. When either Guinness and Mahon or IIB had complied with the instruction someone from the paying bank would telephone Ms Williams to inform her that the instruction had been met and the draft, cheque or cash was available for collection. An envelope would be left at Reception to be collected by the caretaker or Mr Traynor’s driver. This system of making withdrawals has been described to the Inspectors as fairly regular and accordingly the caretaker and Mr Traynor’s driver knew to check at Reception on each occasion they went to the relevant bank to see if there was anything for delivery back to CRH. Cash withdrawals from IIB were a little more complex because IIB did not have a cash facility. When cash was required the letter of instruction to IIB would request a cheque payable to either Bank of Ireland or Kentford Securities - the name of the account that was used for this purpose in Bank of Ireland. The cheque would then be lodged in Bank of Ireland and the cash equivalent withdrawn. Once again either the caretaker or Mr Traynor’s driver would be asked to make the cash collection though on one or two occasions Ms Williams herself collected cash from Bank of Ireland. Withdrawals from the Ansbacher accounts were always brought back in the first instance to the CRH offices. Cheques or drafts were either entrusted to Mr Traynor for onward delivery to the clients, or delivered by the caretaker or Mr Traynor’s driver or, on some occasions, posted to clients. Some clients called to Mr Traynor at 42 Fitzwilliam Square to pick up their withdrawals. When the withdrawals were in the form of cash Ms Williams would usually take the precaution of counting the cash. This she would do at her desk and there was no secrecy attaching to the task. The other secretary who shared an office with Ms Williams remarked upon her performing this task and was quite clear in her own mind that this activity had nothing whatsoever to do with CRH’s business but was related to Mr Traynor’s other interests. Cash withdrawals were either collected by the client at Fitzwilliam Square or delivered by the caretaker or Mr Traynor’s driver to the client or the person for whom the cash was intended. The caretaker ‘s recollection is that the cash withdrawals usually ranged somewhere between IR£3,000 and IR£15,000 whilst Mr Traynor’s driver’s recollection is that the cash withdrawals might be something in the region of IR£4,000, IR£6,000 or IR£8,000. Both the caretaker and Mr Traynor’s driver recollect larger withdrawals. The caretaker recollects a withdrawal of approximately IR£28,000/IR£30,000 whilst Mr Traynor’s driver recollects a withdrawal which he knew to be substantially larger than IR£8,000 by reason of the size of the box in which the money was contained and because both Ms Williams and staff at Guinness and Mahon requested that he take particular care. 15.10 Work of Mr Padraig Collery on CRH premises Lodgements to and withdrawals from the various accounts had to be recorded for the purposes of preparing balances and statements of account. Mr Collery would visit the CRH premises for the purpose of preparing up to date balances. His visits were usually after hours. He worked in Mr Traynor’s room on a computer that had been installed there specifically for this purpose. Up to date balances appear to have been produced in this way on a monthly basis although, as indicated previously, statements of account went to the clients only every three months. Mr Collery was known by other members of the CRH staff to be using the chairman’s office for purposes that had nothing to do with CRH. 15.11 Work of Mr John Furze on CRH premises Mr Furze (who, it will be recalled, was one of the Cayman based Ansbacher directors) also made use of the CRH premises when he came to visit Ireland. He used the offices for the purpose of preparing reconciliations between the records held in Cayman and the records held in Dublin. It appears that he also saw some clients known to him in the offices in Dublin. Mr Furze was known to the staff in 42 Fitzwilliam Square as a banker from the Cayman Islands who was involved with Ansbacher. No attempt was made to conceal from the staff in 42 Fitzwilliam Square the fact that a Cayman Islands banker was making use of the CRH premises for the purpose of preparing reconciliations. 15.12 Ansbacher letterhead The Inspectors have seen thousands of documents bearing the Ansbacher letterhead and an annotation containing the words 'please reply to 42 Fitzwilliam Square annotation was actually affixed to the original of the documents by way of a label. The Letters of this nature were typed by Ms Williams and on occasion by the other secretary in the CRH offices and sent out at Mr Traynor’s request. Letters bearing the Hamilton Ross letterhead and carrying a similar annotation were also dealt with in this fashion. Thus, 42 Fitzwilliam Square was actually notified openly as being the premises at which Ansbacher (Cayman) Limited and Hamilton Ross might be contacted. 15.13 Visits of Henry Ansbacher executives to 42 Fitzwilliam Square It was not unusual for executives from Henry Ansbacher & Company to visit Mr Traynor at 42 Fitzwilliam Square. Thus, at a time when there was some concern being expressed in London regarding the Dublin accounts, Mr Kevin McAuliffe, an executive from Henry Ansbacher & Company, visited Mr Traynor in May of 1992. He spent approximately one hour examining the memorandum accounts on the computer at Fitzwilliam Square. He reported that the bookkeeping system appeared to be satisfactory and that earlier difficulties in reconciling the position with Cayman appeared to have been alleviated by that time (see Appendix X(a)). Later, in October of 1992, Mr Richard Fenhalls and Mr Brian Lavelle of First National Bank of South Africa met with Mr Traynor at 42 Fitzwilliam Square. Mr Collery also attended part of this meeting. This meeting was referred to in Chapter 12 (see Appendix IX(g)). For present purposes, it is sufficient to note that this important meeting regarding the Dublin business and involving high ranking executives from Henry Ansbacher & Company and the ultimate purchasers of the Ansbacher business took place at 42 Fitzwilliam Square. 15.14 After Mr Traynor’s death Even after Mr Traynor’s death, a certain amount of Ansbacher business continued to be transacted through 42 Fitzwilliam Square. Ms Williams continued to send out written instructions, usually at the direction of Mr Collery. After Mr Traynor’s death, both Mr Furze and Mr Collery visited the premises at 42 Fitzwilliam Square. The computer and an amount of Ansbacher related documentation was removed and this ended the relationship between CRH and Ansbacher. 15.15 Knowing or unknowing assistance? The Inspectors are satisfied that CRH did in fact assist Ansbacher in the carrying out of its business in the manner described above. The question arises however as to whether or not CRH may be said to have done so knowingly or unknowingly. The Inspectors have already concluded that there is evidence tending to show that Ansbacher was guilty of the criminal offence of carrying on unlicensed banking business within the State contrary to Sections 7 and 58 of the Central Bank Act, 1971, as amended by Section 9 of the Central Bank Act, 1989. If the Inspectors conclude that CRH knowingly assisted Ansbacher in the carrying out of its business in Ireland then there would be evidence tending to show that CRH was also guilty of the criminal offence of carrying on an unlicensed banking business within the State by virtue of having aided and abetted Ansbacher to do so. One who aids and abets, by virtue of Section 8 of the Accessories and Abettors Act, 1861 and Section 7(1) of the Criminal Law Act, 1997 is to be treated as a principal offender. The Inspectors will consider therefore the evidence suggestive of knowing assistance and the evidence suggestive of unwitting assistance. 15.16 The range and duration of the activities carried out on CRH premises The Inspectors are struck by the range of activities carried out on CRH premises and making use of the CRH facilities. Mr Traynor’s activities bore all the hallmarks of banking and he carried out these activities in CRH for almost six years. The range and duration of the activities is suggestive, but no more than that, of the idea that CRH was actually aware of Mr Traynor’s conduct. 15.17 Transparency of conduct of Ansbacher business at 42 Fitzwilliam Square The Ansbacher activities at 42 Fitzwilliam Square making use of CRH facilities and CRH staff were open and transparent. The caretaker confirmed to the Inspectors that there was no secret about what he was doing and no one asked him not to say anything about his activities. Similarly, Mr Traynor’s driver told the Inspectors that there was nothing hidden in relation to his activities. Of course, the fact that Ansbacher was carrying on business in Ireland from the CRH premises at 42 Fitzwilliam Square was well known to those with whom it regularly did business, including in particular Guinness and Mahon, IIB and Bank of Ireland. The fact that Mr Traynor had influence over the funds of private clients and could be contacted in that regard at the premises of CRH appears to have been known to persons in the business community. Thus, Mr Ray McLoughlin told the Inspectors that when seeking support for a rights issue in James Crean pic it became known to himself and his advisors that Mr Traynor and his clients might be able to assist. Mr McLoughlin made contact with Mr Traynor seeking his support and that of his clients and indeed Mr Traynor offered Mr McLoughlin a positive response. They met to discuss this issue at the CRH premises at Fitzwilliam Square. The transparency of the activities taken with the range and duration of the activities is a further indication that CRH was actually aware of what Mr Traynor was doing at 42 Fitzwilliam Square. 15.18 CRH directors as clients of Ansbacher As appears in Chapter 23, the Inspectors have concluded that eight directors of CRH were, in their personal capacities, clients of GMCT/Ansbacher. This is of some significance when considering the knowledge of CRH, as a corporate entity, of the activities of Ansbacher in Ireland. The eight directors are: 1. Mr Anthony Barry; 2. Mr James Culliton; 3. Mr Michael Dargan; 4. Mr Gerald Hickey; 5. Mr Diarmuid Quirke; 6. Mr Desmond Traynor; 7. Mr Robert Willis; 8. Mr Richard Wood. Given that they held the senior executive functions within the company in the relevant period, it is important to say something of the circumstances surrounding the relationship of Mr Culliton and Mr Barry with GMCT/Ansbacher. 15.19 Mr James Culliton Mr Culliton was appointed Chief Executive of CRH in July 1974. He joined the board of CRH at that time and came in contact with Mr Traynor. He retired as Chief Executive in 1987 - the same year that Mr Traynor became Chairman. Mr Culliton’s stewardship of the group is associated with its outstanding success. Some time in 1979, Mr Traynor suggested an offshore banking facility to Mr Culliton. Mr Culliton believes that he may himself have prompted this suggestion by referring to the very high rate of taxes at that time. Mr Traynor told Mr Culliton that he could place money for him in a demand account, that the deposit would have a variable rate of interest and that the interest would be paid gross. It was made quite clear to Mr Culliton that the arrangement was to be secretive. He got no application form to sign, no documents whatsoever were produced to him, no statements were given to him and there was no reference to fees or commissions. Mr Culliton terminated the facility some time in 1987 around the time of his retirement as chief executive. Mr Culliton made an arrangement with the Revenue Commissioners arising from these dealings. After his retirement, Mr Culliton remained a non-executive director of CRH until 1994. 15.20 Mr Anthony Barry Mr Barry succeeded Mr Culliton as Chief Executive of CRH. His tenure of that position coincided broadly with Mr Traynor’s chairmanship. He succeeded Mr Traynor as Chairman. Some time in 1989, knowing of Mr Traynor’s background in banking, Mr Barry initiated a discussion with Mr Traynor in which he explained that he was in receipt of certain monies by way of expenses and that he wished to get these monies to children who were living abroad. This conversation probably took place in 42 Fitzwilliam Square. Mr Traynor suggested making use of the offshore facilities available to him. From time to time Mr Barry gave cheques to Mr Traynor for lodgement to his account. He would either send them through the internal mailing system marked for the personal attention of Mr Traynor or would deliver them to him personally on one of his regular visits to Fitzwilliam Square. Mr Barry gave instructions in relation to a small number of withdrawals to Mr Traynor personally. He also received from Mr Traynor statements in relation to his account. The statements were sent to him at his office in Belgard Road from 42 Fitzwilliam Square. Mr Barry acknowledged that the features of his personal relationship with Ansbacher bore the hallmarks of banking and that they took place making use of the CRH premises and facilities. It is apparent, therefore, that a number of directors of CRH including successive Chief Executives availed of the private banking facilities being offered by Mr Traynor. So far as Mr Culliton is concerned, the Inspectors are satisfied that Mr Traynor promoted his offshore banking facility to Mr Culliton as being one which could assist Mr Culliton to evade tax and that Mr Culliton was aware of Mr Traynor’s intentions in this regard. Mr Culliton, after his retirement as Chief Executive, remained a director of CRH during the period when Mr Traynor was Chairman of CRH. In Mr Barry’s case, the actual banking relationship with Mr Traynor existed during Mr Traynor’s period as Chairman and the service provided by Mr Traynor to Mr Barry involved the use of CRH facilities. The banking relationship of the other directors was no less unorthodox. For example, Mr Willis, himself a former Chairman of CRH, referring to statements of his account which he received from Mr Traynor, was concerned that ‘everything warn’t quite kosher Mr Willis’ dealings with Mr Traynor were effected usually either on the way to CRH meetings, immediately before the meetings or immediately after the meetings. The fact that a significant number of directors of CRH, including successive Chief Executives (Mr Culliton and Mr Barry), were themselves clients of Ansbacher and the fact that some of them conducted their dealings with Mr Traynor making use of CRH facilities or at least in a CRH context is a further suggestion of knowledge on the part of CRH of the assistance it was providing to Mr Traynor and Ansbacher. There is then a substantial body of evidence indicative of knowledge on the part of CRH of the assistance it was providing to Ansbacher but there is also a body of evidence to the contrary effect which the Inspectors must also consider. 15.21 The location of the Chairman’s office Mr Traynor’s office at 42 Fitzwilliam Square was isolated from the main executive and administrative centre of CRH’s business which was located at Belgard Road, Clondalkin. It is true that the chief executives of the company visited Mr Traynor on occasion at 42 Fitzwilliam Square and it is true also that a number of committee meetings were held in the Board Room in 42 Fitzwilliam Square, but the main board meetings of the company were held in Belgard Road and a significant number of the executives of the company had no dealings with Mr Traynor whatsoever at 42 Fitzwilliam Square. This isolation of Mr Traynor from the main executive and administrative centres of the CRH business is of some significance when assessing the knowledge of CRH. 15.22 No knowledge of the CRH Board The Inspectors have heard sworn testimony from a number of CRH directors past and present. Each and every director of CRH who has given evidence to the Inspectors has stated that the affairs of Ansbacher or indeed the private affairs of individual directors who were clients of Ansbacher were never discussed at board meetings of CRH. The Inspectors have no difficulty in accepting this evidence and indeed it is not surprising. It would have been unusual for Mr Traynor to discuss these matters at a CRH Board meeting and it would have been counter to everything that the Inspectors know of the nature and character of the man. The Inspectors are satisfied therefore that knowledge of Ansbacher’s activities cannot be attributed to the Board of CRH per se. 15.23 No collective knowledge Each of the directors of CRH who was a client of Ansbacher has denied knowledge of the fact that any other director of CRH was also a client of Ansbacher. In each case, the individual director gave evidence to the effect that they regarded Mr Traynor as effecting a personal favour on his behalf. The Inspectors accept this evidence. Once again it is consistent with the nature of the man that Mr Traynor for his part would not speak of the affairs of any one director to another director and given the nature of their dealings with Mr Traynor it is not surprising that each of the directors did not speak to others about their own affairs. The Inspectors conclude therefore that there was no substantial body of knowledge within CRH of what it was that Mr Traynor was doing but rather there was piecemeal knowledge of his activities. It is notable also that some of the directors who were clients of Ansbacher ceased to be clients before others became clients and/or before Mr Traynor became Chairman of CRH and/or before Mr Traynor began using the CRH facilities to conduct the Ansbacher business. 15.24 Absence of knowledge on the part of many The Inspectors accept the evidence of those directors of CRH who said they knew nothing whatsoever of Mr Traynor’s activities. Mr Molloy described these directors as being ‘astonished’ and ‘genuinely dismayed’ on learning of his activities. The Inspectors also accept that the majority of the Board of Directors was at any one time made up of individuals who knew nothing of the business that Mr Traynor was carrying out from the CRH premises. 15.25 Trust in Mr Traynor A number of the directors of CRH who gave evidence to the Inspectors spoke of the trust which they had in Mr Traynor. Even those who had a banking relationship with him spoke of his integrity and the confidence that they had in him. The Inspectors accept that those directors who had no banking relationship with Mr Traynor were entitled to have trust in him and were reasonable in assuming that he was at all times discharging his duties as Chairman of CRH in a wholly proper and legal fashion. However, the Inspectors do not accept that those directors who did have a banking relationship with Mr Traynor were entitled to hold him in the same regard. 15.26 Conclusion Having considered all of the relevant evidence and having regard to the relevant legal principles concerning corporate knowledge the Inspectors conclude, on balance, that CRH as a corporation cannot be said to have knowingly assisted in the carrying out of Ansbacher’s activities in Ireland. In coming to that conclusion, the Inspectors accept that the knowledge of Ms Williams, the other secretary, the caretaker and Mr Traynor’s driver of the banking business carried on from 42 Fitzwilliam Square is not knowledge which can be imputed to CRH, albeit that the Inspectors note the transparency with which that activity was conducted. In the words of Lord Denning, those persons were the ‘hands to do the work ’they were not ‘the directing mind and will o f the company 4 Several of the directors of CRH who gave evidence to the Inspectors spoke of the pride CRH takes in its systems of corporate governance. Whilst the Inspectors have concluded that CRH cannot be said to have knowingly assisted the carrying out of the Ansbacher business in Ireland, they cannot agree that in this matter the CRH systems of corporate governance were deserving of pride. CRH must bear some responsibility for the fact that the activities of Ansbacher continued for the period 1989 to 1994. 4 See the decision of Denning L J in HL Bolton (Engineering) Company Limited v. TJ Graham & Sons Limited [1956] 1 QB 159. ASSISTANCE PROVIDED BY BANK OF IRELAND PRIVATE BANKING LIMITED (‘BOIPB’) INDEX Page 16.1 Introducti on 191 16.2 Poinciana and Worldwide accounts 191 16.3 Ansbacher accounts 192 16.4 New Poinciana accounts 192 16.5 State of knowl edge of Mr Mori arty 192 16.6 Conclusion 192 ASSISTANCE PROVIDED BY BANK OF IRELAND PRIVATE BANKING LIMITED (‘BOIPB’) 16.1 Introduction BOIPB’s involvement with Ansbacher’s Irish business began when, in early 1992, Mr Traynor called to see Mr Michael Moriarty, the then Head of Private Banking, and explained to him that he looked after investments for a number of individuals. He said he had lodged funds in another bank, but that he wished to ‘spread them around a bit’, and proposed opening some accounts in BOIPB. 16.2 Poinciana and Worldwide accounts Accordingly, in May 1992, a call deposit account number 27711020 was opened in BOIPB in the name of a Cayman company, Poinciana Fund Limited and a call deposit account number 27712020 was opened in the name of a second Cayman company, Worldwide Management and Consultancy Services Limited (‘W orldwide’). Both were non-resident accounts. An identical sum was transferred to both deposits from an account in Ansbacher’s name in IIB. The funds in both accounts were immediately transferred to fixed deposit accounts for one month, number 27711300 in the case of Poinciana, and number 27712300 in the case of Worldwide. The Inspectors interviewed Mr Moriarty and Mr Andrew Brennan, the former Relationship Manager with BOIPB. Mr Brennan and M r Moriarty said that they were both aware at the time that these companies held funds beneficially owned by other persons. The Inspectors put it to Messrs Brennan and Moriarty that, in such a case, a bank should not open a non-resident account without ascertaining the residential status of the beneficial owners of the funds, but they did not accept this proposition. They said they were satisfied that the companies themselves were non-resident, and that they were not obliged to go further than that. 16.3 Ansbacher accounts Upon maturity of the two deposits in July, the funds were transferred to two fixed deposit accounts: Ansbacher Limited ref 353 Poinciana Fund Limited and Ansbacher Limited ref 354 Worldwide Management and Consultancy Limited. In March 1993, both deposits together with the interest that had accumulated on them were transferred to an account in the name of Hamilton Ross in IIB. 16.4 New Poinciana accounts In May 1993, two new call deposit accounts were opened in Poinciana’s name in BOIPB. One, a US$ account, was numbered 27711011, and the other, a STG account was numbered 277110211. The funds in both were then transferred to fixed deposit accounts - number 27711302 in relation to the US$ account. In May 1994, shortly after the death of Mr Traynor, the sterling deposit was transferred to an account in the name of Hamilton Ross in IIB, via the Royal Bank of Scotland on the instructions of Joan Williams. Again on Ms W illiams’ instructions, the US$ deposit continued to roll over from month to month until, in 1995, she told the bank to deal in future with M r Sam Field-Corbett in relation to the account. Finally, in May 1997, halfway through the McCracken Tribunal, the US$ account was closed on the instructions of John Furze and the funds were transferred to Bank of America International, New York for the credit of Cayman National Bank for the benefit of Western International Trust Company. 16.5 State of knowledge of Mr Moriarty Mr Moriarty has told the Inspectors that he was aware that the Poinciana and Worldwide accounts held funds belonging to other persons. 16.6 Conclusion The Inspectors accept that the account documentation was in order in that the entities in whose name the accounts were opened were non-resident. However, superimposed upon this is the knowledge of BOIPB that clients of M r Traynor beneficially owned the funds in the accounts. In the circumstances where BOIPB was aware of this fact, and where instructions in relation to the accounts were issued at all times by an Irish resident (Mr Traynor himself) using notepaper with an Irish address, the Inspectors are of the view that, given the potential DIRT implications, BOIPB ought to have questioned the residential status of the beneficial owners. The Inspectors conclude that in failing to do so BOIPB assisted Ansbacher (perhaps unwittingly) in concealing the fact that Irish residents were the owners of the funds in the relevant accounts, and thus - again, perhaps unwittingly - assisted Ansbacher to conduct Ansbacher’s business so as to defraud a creditor of Ansbacher’s clients, namely, the Revenue Commissioners. INDEX Page 17.1 Introduction 196 17.2 The memorandum accounts 196 17.3 Development of Mr Collery’s role 197 17.4 Period to 1986 199 17.5 1986 to 1989 199 17.6 1989 to Death of M r Traynor 204 17.7 Mr Collery’s role in Hamilton Ross up to the death of Mr Traynor 206 17.8 Mr Collery’s Ansbacher work after the death of Mr Traynor 208 17.9 Mr Collery’s Hamilton Ross work after death of Mr Traynor 209 17.10 Payments to Mr Collery from Hamilton Ross 210 17.11 Level of control exercised by Mr Collery 211 Page 17.12 Conclusions 212 17.13 Criminal offences 212 195 17.1 Introduction Mr Padraig Collery has had a lengthy career in banking, commencing with his first employment in Lloyds Bank in London in 1968. From 1974 to 1989, he was a senior official in Guinness and Mahon with responsibility for accounts and computer operations. He is currently employed in a firm servicing the banking system, but not as a banker. In 1976, he succeeded Mr Ru Leonard in the maintenance of the so-called ‘memorandum accounts’. When M r Traynor left Guinness and Mahon in 1986, Mr Collery continued to operate the memorandum accounts, visiting M r Traynor’s office at night and at weekends for this purpose. The location was, initially, in the special office provided for Mr Traynor by Guinness and Mahon when he left that firm ’s employment, later it was in the Dublin city centre office of CRH pic. It is clear that the work of M r Collery went through a number of phases during which his role changed fundamentally. The Inspectors must assess each of these phases separately and arrive at conclusions relating to the involvement of M r Collery, which reflect his degree of knowledge and/or control from time to time. 17.2 The memorandum accounts Mr Collery was a young man with some business experience when first employed by Guinness and Mahon. He developed a skill in computers, which brought him into contact with the parallel accounting system developed within Guinness and Mahon for the Ansbacher records, which became known as the memorandum accounts. These were records of the beneficial owners of money held in accounts in Guinness and Mahon in the name of Ansbacher (then GMCT). Detailed records were also held in Cayman of each client’s sub-balance making up the total sterling deposit. As Grand Cayman was far distant in miles and time difference, however, the Irish records were essential tools in providing up-to-date information for the management and disbursement of funds to clients in Ireland. Further, the decision maker on the accounts was not in Cayman but in Dublin - M r Desmond Traynor. The accounts in Dublin became the point of M r Traynor’s control of the funds, relegating the Cayman records to an out of date record to be up-dated from time to time. Thus the posting of the memorandum accounts in Dublin was a vital part of M r Traynor’s control mechanism. 17.3 Development of Mr Collery’s role A number of dates are important in appreciating the role of Mr Collery as it developed. Pre-September 1984: GMCT was owned by Guinness and Mahon. M r Traynor was chairman of GMCT, vice-chairman of Guinness and Mahon and a board member of Guinness Mahon London. M r Collery was the employee of Guinness and Mahon in charge of the memorandum accounts maintained in the Guinness and Mahon office on a separate ledger. September 1984: GMCT acquired from Guinness and Mahon by Guinness Mahon London. No other change in operation. M ay 1986: Mr Traynor resigned from board of Guinness and Mahon and Guinness and Mahon London. He was set up in an office owned by Guinness and Mahon and financed by Guinness Mahon London and Guinness and Mahon, so as to continue the GMCT operation in Ireland. The use of the Guinness and Mahon computer continued but with the difference that Mr Collery was now acting (in so far as his Cayman work was concerned) under the control of a person (Mr Traynor) no longer employed by Guinness and Mahon M ay 1987: Mr Traynor was appointed chairman of CRH pic, supplied with an office, and thereupon left the Guinness and Mahon premises. In late 1987, the computer records for GMCT’s Irish customers memorandum accounts were moved to the CRH office. update records. M r Collery was given access to CRH premises to M r Collery was still employed by Guinness and Mahon but carried out his Cayman function separately from his other work. From M ay to August 1988: A consortium consisting of Mr Desmond Traynor, Mr John Furze, M r John Collins and Mr Hugh Hart purchased GMCT from Guinness Mahon & Co, and in August sold on 75% of the company to Henry Ansbacher Ltd. For the first time, there was no connection between the Guinness Mahon Group and the Cayman company. M r Collery continued to do the memorandum accounts. 1989\ An Internal Audit Report within the Guinness Mahon Group raised various issues concerning the Dublin deposits and memorandum accounts. Mr Collery’s role was highlighted. Mr Collery resigned from Guinness and Mahon during 1989 in the midst of discussions on the Internal Audit Report. After his departure, he continued to update the memorandum accounts for M r Traynor and Ansbacher. 1990-1: Ansbacher accounts were for the most part closed in Guinness and Mahon during late 1990 and early 1991, and moved to IIB. The memorandum accounts were among those moved. Mr Collery continued to provide the same service. From September 1992'. From this date, certain accounts in the name of Ansbacher in IIB were re-designated Hamilton Ross. All memorandum accounts were in the name of Hamilton Ross from January 1993. M r Collery participated in the change. M ay 1994: Mr Traynor died. Post M ay 1994: From the date of M r Traynor’s death, and for some years thereafter, Mr Collery provided two different services, one to Ansbacher in respect of its remaining clients, and one to Hamilton Ross in respect of its continuing operation. It appears to the Inspectors that the foregoing work can be further grouped into four different periods : 17.4 - Up to the departure of M r Traynor from Guinness and Mahon in 1986; - From 1986 to M r Collery’s resignation from Guinness and Mahon in 1989; - From 1989 to death of Mr Traynor in May 1994; - After 1994. Period to 1986 In the period up to the departure of M r Traynor from the Guinness Mahon Group, Mr Collery kept the memorandum accounts up to date internally on the Guinness and Mahon computer. If he was receiving any payment for this, it was really in addition to his Guinness and Mahon salary and not as an independent contractor. It is clear from the records available to the Inspectors that he was acting at all times as a functionary of Mr Traynor who was his chief executive. The Inspectors record no criticism of his role up to that stage. 17.5 1986 to 1989 In the period after the departure of M r Traynor from Guinness and Mahon, Mr Collery provided a service to GMCT and to Mr Traynor, separate from his ordinary Guinness and Mahon work. He also assumed a greater degree of control over the GMCT business within Guinness and Mahon. His role at this time was the focus of an internal audit report in 1989 produced by the internal audit department of the Guinness Mahon Group in respect of systems within Guinness and Mahon.5 The following are the relevant extracts from that report.: A matter o f particular concern to us relates to the management and control o f the Ansbacher Cayman deposits, amounting to nearly IR£38m and constituting almost 35% o f the bank’s liabilities. These deposits are under the sole charge o f the Associate Director o f the Bank [Mr. Collery] who also acts, in practice but not officially, as a Dublin based representative o f Ansbacher Lim ited and negotiates the rates with G & M in that capacity. The Associate Director additionally manages the related anonymous offshore ‘customer ’ deposits, on behalf o f Ansbacher, almost entirely on his own without any evident accountability to the Board. In this respect too, he acts as a Dublinbased agent o f Ansbacher whilst being a full-tim e employee o f G & M . This dual role, which involves him in acting on behalf o f both the parties to the transaction with little internal check not only creates serious conflicts o f interest but also exposes the bank to unacceptable risks o f fraud. Ansbacher Limited, a company based in Grand Cayman, has deposited, by way o f call and fix e d deposits, amounts equivalent to IR£38m with the bank (Ansbacher deposits’). These deposits equate to funds lodged on offshore call and fix e d deposit accounts with Ansbacher Lim ited ( ‘customer deposits ) by Dublin-based customers. The ledger accounting records o f the customer deposits are maintained by the bank on a ‘bureau system ’ which shares the same hardware as, but is totally independent of, the IBIS/38 system o f G & M Dublin. Thus the Ansbacher 5 The Inspectors note that the 1989 audit report was produced one year after the sale of GMCT to the Henry Ansbacher Group, and it reflects the fact that GMCT was no longer a sister company of Guinness and Mahon. deposits held in the bank’s computer system are represented by the customer deposits held on the bureau system. Ihe bureau system is operated and controlled solely, on behalf o f Ansbacher, by the Associate Director, Operations (DPC) and no other senior official o f the bank has access to that system. Customer names are not held on the system but each deposit is identified by a code. We understand that DPC is aware o f their names. D PC deals direct with the customers or their agents. deposit interest rates with them. He negotiates call/fixed He also negotiates, on behalf o f Ansbacher Limited, with G & M dealers the rates payable on the Ansbacher deposits ensuring that the total interest received by Ansbacher Lim ited agrees with the total interest p a id on the customer deposits. I f the totals do not agree, adjusting entries are passed in the bank’s books by DPC. We understand that Ansbacher Lim ited is remunerated by way o f a fe e o f Vs% per annum calculated on the total deposits although we have not seen any legal documentation to this effect. D PC also receives and processes the paym ent instructions in respect o f customer deposits. Ihe payments are in fa c t made from the Ansbacher deposits held in the bank’s books. Corresponding book-keeping entries debiting customer accounts, which are technically offshore, are than made on the bureau system thus maintaining the equation o f Ansbacher deposits with the customer deposits. In practice (but not officially), therefore, DPC acts as a Dublin-based agent o f Ansbacher Lim ited insofar as the management o f customer and Ansbacher deposits is concerned, although he is employed full-tim e by the bank. A ll transactions relating to these deposits are initiated and processed by DPC. In addition to negotiating with both the parties to the transactions, he raises accounting entries and prepares input vouchers, deal slips, etc. fo r both the parties (G & M and the customers o f Ansbacher Limited). I here is not internal check on his activity. It should also be noted that standard controls generally applicable within the bank to call and fix e d deposits are not applicable to Ansbacher deposits. For example, with respect to money market deals done with Ansbacher Limited, DPC, not the dealer, completes the deal slips; no counter party confirmations are received and the bank’s outgoing confirmations are sent not to Ansbacher Lim ited but to DPC. A s mentioned before, DPC together with certain agent(s) o f the customers, negotiates not only interest payable on the customer deposits but also interest payable on the Ansbacher deposits. This together with the ability to initiate and process paym ent instructions on the Ansbacher deposits with no effective internal check constitutes a serious control weakness. For example, interest rate negotiations could easily be manipulated so as to create a surplus o f interest credited to Ansbacher call deposit accounts over the average interest payable on the corresponding customer call deposit accounts. A s the function o f maintenance and operation o f the deposits is vested in one person only, the surplus may easily be misappropriated without detection because the equation o f balances on customer deposits with the Ansbacher deposit w ill be maintained. It should be pointed out that we have neither detected nor do we have any reason to believe that there has been any irregularity with respect to Ansbacher deposits. However, as the customer deposits constitute records o f Ansbacher Lim ited (and not o f G & M , Dublin) they have not been subject to our review. We have also not reviewed the procedures involved in opening up new customer deposits, i f any new deposits are indeed taken. Further, we have not seen any mandate fo r the operation o f the Ansbacher deposits and customer deposits. In our opinion, lack o f internal control over this activity coupled with the fa c t that the Ansbacher deposits constitute nearly 35% o f the bank’s liabilities expose the bank to serious risks o f loss and embarrassment. These risks together with the legal position o f the bank vis a vis the maintenance o f off-shore customer deposits by a bank employee and on the bank’s premises need to be evaluated by the Board. ’ A cursory reading of the internal report might give the impression that M r Collery had a central role at that stage. The following extracts exemplify this: ‘The bureau system is operated and controlled solely, on behalf o f Ansbacher, by the Associate Director, Operations (DPC) and no other senior official o f the bank has access to that system. Customer names are not held on the system but each deposit is identified by a code. We understand that DPC is aware o f their names. ’ and, ‘D PC [Mr Collery] deals direct with customers or their agents' The reality was different. M r Traynor retained control over the operation. M r Collery was the functionary who facilitated it within Guinness and Mahon, but he was not the prime mover. Again, as already noted, the audit report says: ‘These deposits are under the sole charge o f the Associate Director o f the Bank [Mr. Collery] who also acts, in practice but not officially, as a Dublin based representative o f Ansbacher Lim ited and negotiates the rates with G & M in that capacity. ’ In so far as the above extract identifies Mr Collery as the Dublin agent of Ansbacher, the Inspectors reject it as incorrect. At that time, Mr Collery carried out the functions referred to in the audit report in his capacity as an official of Guinness and Mahon, but in so far as Ansbacher had a representative in Ireland at that stage, it was M r Desmond Traynor. Mr Collery was, of course, carrying out some functions for Ansbacher. He was keeping the memorandum accounts up to date and was acting as in-house contact for Mr Traynor within Guinness and Mahon. He was setting rates on behalf of Guinness and Mahon. He was also used as a contact person within Guinness and Mahon for the Irish clients of Ansbacher. The contacts he made at this time would prove useful when later he was called upon to play a more central role. However, his work on behalf of Ansbacher was at this time under the control and direction of M r Traynor. M r Collery’s position in the Ansbacher hierarchy at this time can be assessed by the level of fees that he received in the year to end April 1989, that is twelve payments of STG£125 and four of STG£1000, totalling STG£5,500 (see extracts from his memorandum account A/A30 at Appendix XI(a)). This level of fees should be compared with the very much larger sums received by Mr Collery later and the US$ 60,000 cost of Mr Traynor to Ansbacher in 1992 as disclosed in a memorandum of Richard Fenhalls dated 16 September 1992 (see Appendix XI(b)). The Inspectors have formed the view that, up to the date of his resignation from Guinness and Mahon in 1989, Mr Collery was acting at all times, in respect of his work for GMCT/Ansbacher, under the direction of Mr Traynor, and was not in a position within the GMCT/Ansbacher structure to affect its policy. Up to this point, the Inspectors’ criticism of his role as an Ansbacher operative or ‘employee’ is of a minor nature. 17.6 1989 to Death of Mr Traynor When Mr Collery left Guinness and Mahon in 1989, the structure of the Ansbacher business in Ireland had changed a great deal from the early days. From 1989 onwards, neither M r Traynor, Mr Collery nor Ms Williams worked for Guinness and Mahon. The Ansbacher money was still on deposit in Guinness and Mahon, but only on a transitional basis. Mr Traynor was operating out of his office in CRH and was the owner, together with Messrs Furze, Collins and Hart, of 25% of the Cayman company, the remaining 75% being owned by the Henry Ansbacher Group. In 1989, Mr Collery began a new phase of his career with a company unrelated either to Ansbacher or to Guinness and Mahon. However, his services were still required by Mr Traynor and being no longer employed by Guinness and Mahon, he was in a much stronger negotiating position. He agreed to continue to update the memorandum accounts on a part-time basis, using M r Traynor’s office in CRH for the purpose. His fee was increased to IR£875 per month - IR£10,500 per annum - by the transfer of two monthly sums of IR£125 and IR£750 into his offshore account (see Appendix XI(a)). His responsibilities were increased, or at least his participation in the offshore service became more clearly identifiable because he no longer mixed a Guinness and Mahon and Ansbacher role. By the end of 1990, the period of retention of Ansbacher funds in the Guinness Mahon Group, which had been agreed (expressly in respect of the London funds and indirectly in respect of the Dublin funds) on the sale of the company to Henry Ansbacher, was expiring and new accounts were opened in IIB to accept the transferred funds. Mr Collery continued to operate the memorandum accounts but also moved into a more central role in managing the Irish business. An internal IIB memo dated 22 November 1990 ends as follows: H e [Mr Traynor] told us that the details o f these various activities were dealt with by Padraig Collery ex Guinness and Mahon who now works part-time fo r Des Traynor at his offices and the best way to proceed would be to discuss details with him after we had come to some preliminary conclusions as to what we would like to do. He would like us to revert to him directly in relation to the back-to-back loans which we prom ised to do early next week. Action We are to consider his needs in how we can respond to them and arrange a detailed meeting with Padraig Collery and phone Des Traynor about the back-toback loans. ’ In the early days of 1991, instructions were issued to IIB about the new accounts. Two examples of such documents, signed by Mr Collery, are included at Appendix XI(c). Many of these communications were on Ansbacher notepaper with a Dublin address superimposed. Mr Collery was the instrument by which many of the executive decisions of Mr Traynor were executed. In view of the information available to Mr Collery from his previous position in Guinness and Mahon, the Inspectors have concluded that there is evidence tending to show that Mr Collery was during this period assisting Ansbacher in: (a) Carrying on an unlicensed banking business; (b) Failing to furnish to the Registrar of companies the information required by sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963 (c) Evading tax due on its own activities; (d) Assisting others to evade tax The extent to which this assistance was the moral responsibility of Mr Collery was still limited to some extent in respect of some of the above wrongs. M r Collery was working under the direction of a strong personality, Mr Traynor, who had been, in one way or another, his boss for nearly twenty years. Because he was continuing the work of Ansbacher’s memorandum accounts, that company’s role in assisting the evasion of tax should also have been plain to him even if he lacked any control over the operation. As he was in secure employment elsewhere, he had one right, which he refused to exercise, the right to refuse to participate. There is therefore at this time, in the opinion of the Inspectors, evidence tending to show that he knowingly assisting Ansbacher to conduct its affairs in this jurisdiction in such a manner as to defraud creditors (that is the Revenue authorities) of other persons (those Ansbacher clients whose accounts he serviced). 17.7 Mr Collery’s role in Hamilton Ross up to the death of Mr Traynor The High Court order establishing this Inquiry instructs the Inspectors to report on related matters. The Inspectors have concluded that the business of Hamilton Ross Limited, in so far as it was a continuation of Ansbacher business, is such a related matter. As related in Chapter 2, much of the Ansbacher business in IIB was transferred to Hamilton Ross in 1992. With this transfer, Mr Collery’s position changed yet again. When the Hamilton Ross accounts were opened in 1992, Mr Collery was included as an authorised signatory (see Appendix XI(d)). The overall control of the scheme continued to rest with Mr Traynor, but Mr Collery’s work went far beyond the maintenance of the newly designated Hamilton Ross memorandum accounts. He knew that Hamilton Ross had started business in Ireland for the first time. For a person of M r Collery’s experience it should have been clear that Hamilton Ross, which he was assisting in its work, was operating in Ireland as a bank (see the Inspectors’ conclusions at Chapter 24). He should also have known that it was operating without a licence. The process of applying for a licence would have been so transparent that he could not have had any doubt that it was not applied for. The suddenness with which accounts were changed from the name of Ansbacher to that of Hamilton Ross was another pointer to the absence of a banking licence. Further, as noted above, his work on the memorandum accounts should have alerted him to his role in facilitating the evasion of tax. He should also have known that the culture of secrecy surrounding Hamilton Ross’s operations was such that proper registration of the company under company law and tax legislation had not been completed. The Inspectors are of the view that Mr Collery’s knowledge at this stage was complete, even if he lacked Mr Traynor’s control over the operation. Once again he refused to exercise his correct option in this matter, namely, the right to refuse to participate. This was a realistic option as he had now independent primary employment. The Inspectors have concluded that there is evidence tending to show that after Hamilton Ross took over the memorandum accounts in late 1992/early 1993 M r Collery: (a) Knowingly assisted Hamilton Ross in its unlicensed banking activities in Ireland; (b) Knowingly assisted Hamilton Ross in its breaches of sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963 (c) Knowingly assisted Hamilton Ross in evading tax due on its own activities; (d) knowingly assisted Hamilton Ross in carrying on business in this jurisdiction in such a manner as to defraud creditors (that is, the Revenue authorities) o f other persons. 17.8 Mr Collery’s Ansbacher work after the death of Mr Traynor After M r Traynor’s death, a fundamental change occurred in Mr Collery’s position. Mr Traynor was a most secretive person, so his death created a big problem for both Ansbacher and Hamilton Ross. At that time, both companies had Irish business, Ansbacher looking after some large Irish clients and both Ansbacher and Hamilton Ross providing a service to those covered by the memorandum accounts. On occasion, a client could straddle both systems. Ansbacher’s witnesses have informed the Inspectors that they recruited Mr Collery to provide them with a service in relation to their clients after Mr Traynor’s demise. Collery confirms this. Mr However, the parties do not appear to be in agreement on the nature of the service M r Collery provided. M r Fraser Jennings who gave evidence on behalf of Ansbacher confirmed that Ansbacher decided to establish a relationship with Mr Collery after the death of M r Traynor. He maintained that the work carried out by Mr Collery on foot of this relationship consisted mostly of making introductions to the existing Irish Ansbacher clients - five or six in all. Mr Jennings stated that to that end, Mr Collery organised meetings both with clients and with intermediaries. His sole purpose, according to M r Jennings, was ‘to maintain communications’. Mr Collery has a different memory of his functions for Ansbacher after Mr Traynor’s death. He describes his Ansbacher work at that time as being to ‘tidy up and wind up’. He further describes it as mainly relating to Tristan Securities (a John Byrne Company) and also as liasing with Cayman. He does not remember as many introductions as Mr Jennings does at this time. The Inspectors are content to consider the matter of Mr Collery’s involvement on the basis of his version of the service provided where it contradicts Mr Jennings recall. However, in addition to the above work, it is clear that Mr Collery continued to process the remaining Ansbacher memorandum accounts. Mr Collery received substantial payments from Ansbacher for his post-Traynor work. Monthly payments of STG£750 were credited to his account up to January 1995. These then stopped, but a final payment of STG£12,000 was received in April 1996. Documents relating to Mr Collery’s work at this time are not available to the Inspectors, having either been destroyed or sent to Grand Cayman. Some letters were written from 42 Fitzwilliam Square in the name of Ansbacher after the death of Mr Traynor but the level of correspondence would indicate that the Ansbacher business was reducing at that stage. This process of reduction had commenced prior to M r Traynor’s death. To the extent that Ansbacher continued to act illegally during this period, Mr Collery has a residual responsibility. The Inspectors are mindful of the difficult circumstances created by the death of M r Traynor in this period of running down of the Ansbacher operation. Mr Collery in this period, in view of his experience, was or ought have been fully aware of all the wrongs of Ansbacher’s Irish operation. 17.9 Mr Collery’s Hamilton Ross work after death of Mr Traynor No such mitigating circumstances can apply to the Hamilton Ross operation in the postTraynor period. Mr Collery provided an additional service after May 1994 to Hamilton Ross. Hamilton Ross had taken over some of the Ansbacher memorandum accounts at the end of 1992 or the start of 1993. The Hamilton Ross Irish operation had commenced in late 1992. It developed rapidly. After Mr Traynor’s death there was no attempt to change or limit the service. The business carried on as usual in 42 Fitzwilliam Square and subsequently in Winetavem Street, Dublin, using the Hamilton Ross name. The Inspectors have concluded in Chapter 24 that there is evidence tending to show that, in the period after the death of M r Traynor, Hamilton Ross was : (a) Operating a bank without a licence; (b) Breaching the provisions of sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963 by failing to provide the Registrar of Companies with the information required of foreign companies by those sections (c) Conducting its business so as to defraud creditors of other persons; (d) Failing to make proper tax returns and payments. In what follows, the Inspectors consider whether Mr Collery participated in and/or assisted in this wrongdoing, and if so, to what extent. 17.10 Payments to Mr Collery from Hamilton Ross After the death of M r Traynor, Mr Collery received substantial sums from Hamilton Ross. These included the following sterling amounts (see Appendix XI(e)). 1. A sum of STG£ 176,101.67 on 28 February 1995 2. A sum of STG£35,000 on 25 April 1995 3. A sum of STG£55,000 on 30 April 1996. The first sum represented the equal division with Mr Furze of a fee account in Hamilton Ross undistributed at the date of M r Traynor’s death. In evidence, Mr Collery explained these large payments as follows by way of reporting a conversation he had with Mr Furze: 7 had no interest nor could I accommodate people the way they - with the service that M r Traynor offered them because I was working on my own day jo b and I said ‘You know you must get this and take it over yourself as quickly as possible but in the meantime i f you expect me to do it I w ill do it in the short term and you w ill pay me substantial fe e s ’ and he did and these are - whatever fe es were gathered in the accounts then were split and you w ill see them coming in there: I think on three occasions. ’ 17.11 Level of control exercised by Mr Collery Another issue considered by the Inspectors was the extent to which Mr Collery exercised control of the operation in that period. It was Mr Collery’s understanding that Mr Furze controlled Hamilton Ross after the death of Mr Traynor. It had been his earlier view that Mr Traynor, when alive, was the owner and controller. The documentation available to the Inspectors suggests that Hamilton Ross was initially owned by Mr Traynor but sold after his death to M r Furze at an unknown date and for an unknown sum. However, even prior to its sale, Mr Furze controlled Hamilton Ross after the death of Mr Traynor under the terms of the trust which owned the shares in the company. Mr Collery, therefore, is correct in his belief that, after M r Traynor’s death, Mr Furze controlled Hamilton Ross at all times, irrespective of ownership. After Mr Traynor’s death, the centre of operations of the Irish business of Hamilton Ross moved to the premises of Mr Sam Field-Corbett at Inns Court, W inetavem Street. Mr Collery told the Inspectors that he arranged the move. Much of the day-to-day work had been done by Ms Williams prior to the move and thereafter by Mr Field Corbett himself. Mr Collery, however, was from then on the person who controlled the operation in Ireland. It would be incorrect to equate his role with Mr Traynor’s earlier control, as Mr Furze was the overall manager and decision maker. It is clear, however, that M r Collery was a vital link in Hamilton Ross retaining its business, and the level of fees earned by him reflects that fact. The Inspectors note the range and content of the correspondence emanating from the Inns Court premises during 1994, 1995 and 1996. The significance of this correspondence is dealt with in Chapter 24. The Inspectors have decided that this correspondence is a significant pointer to the role of Mr Collery. 17.12 Conclusions Having considered all of the foregoing facts, the Inspectors have concluded that Mr Collery, as an experienced banker and businessman, must have been aware of the nature of the business being carried on by Hamilton Ross. The Inspectors are therefore satisfied that there is evidence tending to show that in the period after the death of M r Traynor Mr Collery knowingly assisted Hamilton Ross in: (e) Operating a bank without a licence; (f) Breaching the provisions of sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963 by failing to provide the Registrar of Companies with the information required of foreign companies by those sections (g) Conducting its business so as to defraud creditors of other persons; (h) Failing to make proper tax returns and payments. 17.13 Criminal offences In Chapter 5, the Inspectors concluded that there was evidence tending to show that Ansbacher may have committed the following criminal offences: (a) The common law offence of conspiracy to defraud; (b) The offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the appropriate tax legislation now consolidated in Sections 1056 and 1078(2) Taxes Consolidation Act, 1997. The Inspectors are of the view that in the period from 1989 to 1995 there is evidence tending to show that M r Collery may also have committed these offences. CHAPTER 18 ASSISTANCE PROVIDED BY MS JOAN WILLIAMS INDEX Page 18.1 Introducti on 215 18.2 Ms Williams in CRH 215 18.3 Ansbacher-related tasks carried out by Ms Williams 215 18.4 ‘Assistant Secretary’ of Ansbacher? 216 18.5 Conclusion 217 18.1 Introduction Ms Joan Williams was employed as Mr Desmond Traynor’s personal secretary from 1972 until his death in 1994. During the time that M r Traynor worked in Guinness and Mahon, Ms Williams carried out her duties primarily in relation to Guinness and Mahon business but combined this with a certain amount of GMCT work. The status of Mr Traynor in carrying out his duties in Guinness and Mahon was never clear-cut and certain work was undertaken by him in his dual capacity as a director of Guinness and Mahon and of GMCT. Ms Williams would have taken a full and normal part in such work. 18.2 Ms Williams in CRH When Mr Traynor became chairman of CRH in 1987, Ms Williams too became an employee of CRH, where she continued to act as M r Traynor’s secretary. She remained an employee of CRH after M r Traynor’s death, retiring in 1999. Over the remaining years of M r Traynor’s life, Ms Williams had a central role to play in the organisation of his complicated business life. It is clear from the evidence of Ms Williams that she acted as secretary for all the business activities GMCT/Ansbacher. of Mr Traynor, including his activities in relation to Between 1987 and 1994, the facilities of CRH (including the services of Ms Williams) were used by Mr Traynor to conduct business on behalf of GMCT/Ansbacher from CRH offices. The responsibility of CRH for this state of affairs was considered in Part in of this Report. 18.3 Ansbacher-related tasks carried out by Ms Williams During her time in the chairman’s office, Ms Williams carried out many tasks that were GMCT/Ansbacher related. These included the following: • Checking balances on memorandum accounts in respect of clients of GMCT/Ansbacher; • Typing letters to banks on Ansbacher and Hamilton Ross notepaper; • Sending out Ansbacher and Hamilton Ross statements (from which the bank’s name had been removed by M r Traynor) to clients of Ansbacher and Hamilton Ross; • Lodging cheques sent in by customers to Ansbacher and Hamilton Ross accounts; • Arranging the withdrawal of funds for Ansbacher and Hamilton Ross clients on Mr Traynor’s instructions; • Acting as signatory on bank accounts such as Kentford Securities used in the Ansbacher and Hamilton Ross process; • Fulfilling the role of authorised signatory for transactions with other banks such as Kredietbank N V London; • Facilitating the transfer of the Ansbacher and Hamilton Ross business to the control of Mr Padraig Collery after the death of M r Traynor. 18.4 ‘Assistant Secretary’ of Ansbacher? The Inspectors had the benefit of two interviews with Ms Williams relating to her role as employee, and they considered all evidence relating to the level of her involvement. Particular consideration was given to a description of her as ‘Assistant Secretary’ of Ansbacher in two documents executed on 11 February 1993. These documents were a guarantee to IIB and a letter of set-off relating to the same transaction. Normally such actions would indicate a level of involvement far beyond that admitted in evidence by Ms. Williams. In this case, however the Inspectors are satisfied that this status of Assistant Secretary was inserted by the other co-signatory, Mr Desmond Traynor, to give legitimacy and status to the guarantee he was executing with Ms Williams for and on behalf of Ansbacher. 18.5 Conclusion The Inspectors are satisfied that Ms. Williams was a truthful witness and any discrepancies in her testimony are explained by a failure of memory related to the passage of time. The Inspectors are satisfied, however, that a person of Ms W illiams’s experience and education would over a period of time have acquired some level of understanding that the Ansbacher scheme had a tax evasion dimension. However, her position within the hierarchy of the firms in which she worked and the complicated nature of the issues involved would have effectively rendered her powerless to oppose Mr Traynor’s course of action. INDEX Page 19.1 Introducti on 219 19.2 Services to Ansbacher clients 219 19.3 Hamilton Ross business operating from M r Field-Corbett’s premises 19.4 Mr Field-Corbett’s role in Hamilton Ross 220 19.5 Conclusions 220 19.6 Possible criminal offence 221 19.7 Possible breach of the Companies Acts 221 219 19.1 Introduction Mr Sam Field-Corbett was a close associate of M r Desmond Traynor. Originally he had worked with M r Traynor in Haughey Boland Accountants. When speaking of that time, M r Field-Corbett describes himself as M r Traynor’s assistant. In 1973, he left Haughey Boland and started his own business, Management Investment Services Limited. He operated a bookkeeping service out of 3 Trinity Street, Dublin a premises belonging to Guinness and Mahon. Thus, he retained close contact with Mr Traynor and benefited from referrals from Guinness and Mahon. 19.2 Services to Ansbacher clients Some of the persons to whom Mr Field-Corbett provided a service were Ansbacher clients. M r Field-Corbett accepted in evidence his involvement in a number of such cases. He also accepted his involvement, with two other persons, in a loan, which was backed by Ansbacher funds. This aspect of his involvement is dealt with in Chapter 23. In general, Mr Field-Corbett was used by Mr Traynor as a facility to be offered to clients who needed a point of contact between Mr Traynor and their offshore funds. There is no evidence that he was a principal or exercised any primary control over any offshore funds prior to Mr Traynor’s death. He knew of the Ansbacher scheme, but had no part to play in its control. 19.3 Hamilton Ross business operating from Mr Field-Corbett’s premises After Mr Traynor’s death, it became necessary to find an office to relocate the business of Hamilton Ross. This task fell to Mr Collery. Mr Field-Corbett made office accommodation available to him at 8 Inns Quay, Winetavern Street, Dublin and this was used by Hamilton Ross until 1997. 19.4 Mr Field-Corbett’s role in Hamilton Ross In addition, M r Field-Corbett was installed as one of the signatories on the Hamilton Ross account. From that time on, Mr Field-Corbett played a substantial part in the Irish operation of Hamilton Ross, which, as described earlier, was a continuation of the Ansbacher business in Ireland. The Inspectors conclude that, from that time on, Mr Field-Corbett can be properly described as an agent of Hamilton Ross in Ireland. Mr Field-Corbett sought in evidence to minimise his involvement and to place responsibility for the operation on M r Collery and M r Furze. However, the Inspectors note that Mr Field-Corbett was paid a sum of STG£ 35,000 by Mr Furze during the course of his work for Hamilton Ross. This sum was in addition to his fees from his long established offshore clients. From an examination of the correspondence and from the evidence of Mr Collery, it appears that M r Field-Corbett’s involvement was administrative rather then managerial. It is clear that the control of the operation rested with Mr Furze as regards offshore matters and with Mr Collery in Ireland. M r Field-Corbett seems to have facilitated the running of Hamilton Ross rather than controlled it. However, the level of his involvement on a day-to-day basis was significant. All Hamilton Ross letters written over a two to three year period, whether signed by M r Collery or Mr Field-Corbett, were produced in M r Field-Corbett’s office. Mr Field-Corbett also became a signatory on the account called Darsley Nominees Limited which was used to disburse payments from offshore funds to Hamilton Ross clients in Ireland 19.5 Conclusions From the knowledge he had gleaned from his contact with Ansbacher clients, it must have been clear to Mr Field-Corbett that Hamilton Ross was operating a banking business from his premises and that his contribution was an important part of its work. The Inspectors have concluded that Hamilton Ross is a ‘related matter’ on which the Inspectors must report in accordance with the Order of the High Court (see Chapter 24). The Inspectors have further concluded in Chapter24 that there is evidence tending to show that Hamilton Ross operated an unlicensed banking business from 8 Inns Court W inetavem Street, the premises supplied by Mr Field-Corbett. M r Field-Corbett was fully aware of the nature and scale of the operation carried out on his premises, even if he did not have executive responsibility for it. 19.6 Possible criminal offence The Inspectors have considered the level of M r Field-Corbett’s involvement and have concluded that in supplying and continuing to supply a premises and back up service to Hamilton Ross from 1994 to 1997 there is evidence tending to show that Mr FieldCorbett may have committed a criminal offence, namely: acting in breach of Section 7 of the Central Bank Act, 1971 (as amended), by aiding and abetting in the manner envisaged by Section 8 of the Accessories and Abettors Act, 1861 and/or Section 7(1) of the Criminal Law Act, 1997, thereby rendering himself responsible as a principal offender. 19.7 Possible breach of the Companies Acts Mr Field-Corbett also permitted Hamilton Ross to operate out of his premises without ensuring that the appropriate notifications were made as required by Part XI of the Companies Act, 1963. In particular in the case of M r Field-Corbett, the failure to comply with Section 355(b) of the Companies Act, 1963 (the display of the Company’s name at its principal place of business in the State) was a matter for which he had responsibility as an agent of Hamilton Ross. INDEX Page Introduction 224 Early Career 224 Consultancy business 225 Deposit monitoring service 226 Practical arrangements 229 Location of offshore accounts 231 Mr Stakelum’s clients and the Ansbacher connection 231 Business Enterprises Limited and BEL Secretarial Limited 232 Move away from Guinness and Mahon 232 Conclusion regarding Mr Stakelum’s assistance of Ansbacher 233 Conclusion regarding Mr Stakelum’s services as a related matter 233 Page 20.12 Criminal Offences 234 223 20.1 Introduction Mr Jack Stakelum is a chartered accountant who, from 1975 until 1998, operated a number of businesses in what might be described today as the financial advisory sector. In the course of these businesses, Mr Stakelum acted as a financial intermediary between his clients and Ansbacher’s offshore deposit facility. He also acted as a non-executive director to a substantial number of companies controlled by his clients. The Inspectors considered the relationship between Ansbacher and Mr Stakelum, both in the context of whether the latter’s activities were of assistance to Ansbacher, and whether these activities were a related matter within the meaning of clause 2(e) of the Order appointing the Inspectors. 20.2 Early career Mr Stakelum joined the then small accountancy practice of Haughey Boland in 1956 to train as a chartered accountant. At that time, Messrs Charles Haughey and Harry Boland were the two partners, and Mr Desmond Traynor was a recently qualified senior. Mr Stakelum worked there until 1975, with an interval of four years from 1958 to 1962 during which time he qualified with Kennedy Crowley. On his return to Haughey Boland as a qualified senior, he worked very closely with M r Traynor, who had become a partner. Mr Traynor became involved with providing business advisory services to his larger clients, leaving more of the audit managerial responsibilities to M r Stakelum. One client of Mr Traynor’s was Guinness and Mahon, which he advised on property and taxation schemes. Mr Stakelum became a partner in 1967 and started to take insolvency appointments. When Mr Traynor left in 1969 to join Guinness and Mahon as joint managing director, Mr Stakelum inherited many of his audit clients. He subsequently referred lending opportunities to Guinness and Mahon. In 1975, he left Haughey Boland and by agreement retained in the region of 43 insolvency cases, which he subsequently completed. Mr Stakelum was a close personal friend of Mr Traynor with whom he discussed his leaving of Haughey Boland. This friendship made him aware that M r Traynor was involved with a bank in Cayman that dealt with offshore deposits for Irish residents, and, Mr Stakelum informed the Inspectors that he suspects that he was aware that discretionary trusts were being established. He also knew that Messrs Collins and Furze were directors of Ansbacher, then known as GMCT. Indeed, while still a partner in Haughey Boland in the early 1970s, Mr Traynor had suggested to him a scheme (which was reported to him as legitimate) for mitigating his tax liability which involved Mr Stakelum obtaining a loan from Guinness and Mahon that was deposited offshore through an investment in an offshore limited company. This was one of a category of early offshore ‘suitably secured’ situations. 20.3 Consultancy business While still with Haughey Boland, Mr Stakelum identified a market need which arose from his receivership, liquidation and financial restructuring experience. Therefore, in December 1975, he set up Business Enterprises Limited, a company through which he offered a range of services until his retirement on 31 October 1998. These services included financing proposals to banks, business projections, payroll production, and the preparation of management accounts. In addition, (and this was of particular value to the owner-managers of growing businesses), he was available to act as a sounding board on operational issues, including the resolution of business difficulties. Advice of this kind sometimes involves the sale or purchase of businesses, and the opportunity to act as a non­ executive director. In essence, Mr Stakelum’s business became the dispensing of a mixture of commercial and finance-raising advice. 20.4 Deposit monitoring service At some stage shortly after he commenced business, M r Stakelum was asked by some of his clients to look after funds they were holding outside Ireland. He described the arrangement thus (see transcript of M r Stakelum’s evidence of 8 November 2000 attached at Appendix XII(a)): ‘Q. Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in the sense o f what interest rate ... (INTERJECTION). Q. B ut you were not a bank? A. No. Q. They were asking your advice as to where to p u t the funds? A. They were asking me whether I could monitor those funds on their behalf Q. Monitor is a w ord you use; I don 7 understand it. and they come into you. A. Your clients have funds What do they ask you to do? They would say ‘We have funds offshore ’ wherever they might have been ‘Can you look after these funds fo r me. ’ Q. ‘Can you look after these funds. ’ What did that mean? A. Would you endeavour to get the best interest rate. Would you monitor the funds. Q. Take it slowly. Would you endeavour to get the best interest rate. Were they asking you to change where their funds were into some other financial institution? A. I d o n ’t think they would come in and say ‘We have funds. Will you change them fo r some other financial institution. ’ I think a discussion would have arose with them that they would have advised me that they had £x in funds and say ‘Can you look after these funds on my behalf. ’ Q. What does that mean? A. It means that they might not want to correspond directly with whatever foreign bank they were using. They might not want to get mail received from foreign banks on the basis o f monthly statements. They w ouldn’t fe e l that necessarily competent about looking at whether the funds should be placed one month or three months or six months. A nd that they would like me to look after those factors. Q. What did you do then? A. I would probably advise them at some stage that there would be facility through Guinness and Mahon. Q. You then contacted Guinness and Mahon? A. Yes. Q. You used the w ord facility ’. What does that mean in this connection? A. It means I probably would have contacted Des Traynor. I w ould have said 7 have a client - - fo r the most part he wouldn 7 know who my clients were - that wishes to have funds m onitored abroad by me. ’ This was a service he had not envisaged providing, and when he agreed to it, he required it to be on a ‘minimalist basis’. In a written submission to the Inspectors M r Stakelum, who described his role as that of being his clients’ personal intermediary, set out the guidelines he adopted: ■ Funds would be deposited in licensed banks at rates of interest that would be competitive and market related; ■ All decisions in relation to these funds would be conveyed to him directly and orally by the client concerned; ■ He would undertake no advisory or management role in relation to these funds, he merely monitored them; ■ He would neither issue nor obtain receipts for movements in funds. Neither would he keep any ledger records, issue statements or engage in correspondence; ■ Information in relation to balances and rates of interest would be provided on an oral basis only. Initially, the client funds were abroad, and he made arrangements with M r Traynor to enable his clients to transfer their overseas funds through the banking system to, for example, Guinness and M ahon’s account in Guinness Mahon London for sterling deposits, and Guinness Mahon & Co in New York for US dollar deposits, where they would be given a coded reference. A reference number supplied by Mr Traynor identified the ownership of the funds transferred to Guinness and Mahon. Thereafter, they would be routed on to their final offshore banking destination by M r Traynor. The money deposited through Mr Traynor by M r Stakelum was accounted for by Mr Stakelum in what he described as ‘hotchpotch’ accounts and into this account he accumulated all the funds given to him by his clients. To properly account for these funds, he maintained a manual memorandum record for each client’s money under his personal control, and he performed a monthly reconciliation of the total of the memorandum records with the sum of funds deposited with Guinness and Mahon and any float balances (described below). It became evident to Mr. Stakelum that other clients, who had funds available in Ireland for deposit, could avail of the offshore arrangements. He explained to them that their monies would be deposited in an offshore account associated with Guinness and Mahon. He did not recommend the arrangement with Guinness and Mahon, but rather advised clients: ‘..........Guinness Mahon have an offshore operation. That is the only place that I can handle the funds through and it would be up to them [the clients] to decide whether or not they transferred there. I w a sn ’t aware o f other options or presenting, them with options. ’ (see transcript of Mr Stakelum’s evidence of 6 December 2000 attached at Appendix XII(b)). In many ways, Mr Stakelum was acting in a capacity similar to what is now described as a tied agent in that he only introduced his clients to a single destination for their deposits. Since M r Traynor and Guinness and Mahon did not know the names of the individuals whose combined funds made up the total of the hotchpotch accounts, it follows that the accounts were operated by Mr Traynor as being under the control and legal ownership of Mr Stakelum. The beneficial ownership of the funds, according to Mr Stakelum, remained pro rata with his individual clients. 20.5 Practical Arrangements Once he decided to accept funds in Ireland, Mr Stakelum had to create a system for handling receipts from and facilitating payments to clients. He did this by operating a current account in an AIB branch in a business name entity, Business Enterprises (replaced later by Clyde Enterprises), in which was maintained a float of funds. This account did not attract interest, so the client monies did not earn interest while they remained in it. When Mr Stakelum received an Irish pounds deposit he lodged it into the Clyde Enterprises account where it was incorporated into the float until some other client wished to withdraw money from the offshore deposit. The withdrawal was funded out of the float. The practical effect of these arrangements was that small withdrawals were likely to be available to clients quickly and without Mr Stakelum needing to contact Guinness and Mahon. Quite obviously larger withdrawals would have needed funds from Ansbacher through M r Traynor. Mr Stakelum’s memorandum accounts had to keep track of these transactions. Prior to the break with sterling in 1978, it was possible to transfer clients’ funds abroad without any difficulty. However, after that things changed (see Appendix XII(b)): 'If they wished to transfer Irish pounds abroad, I think at a stage, at an early stage, there was no problems about that because I think the pound and the sterling were one and the same and that there was no restriction on sterling so it could ju s t be mover abroad offshore. A t a later stage that was a problem and the only way that that could be done would be to supplant and replace funds. I f somebody wanted to take funds back from abroad and somebody wanted to p u t them out, you could do it by journal entry. ’ Sometimes his clients had to wait for their money to be moved out of the Clyde Enterprises current account into the hotchpotch account. In Mr Stakelum’s mind, this was a matter of timing (see Appendix XII(b)):- A. I would be saying to the client, i f and when I have an opportunity I will transfer that abroad and when an opportunity presented itself where somebody might ask fo r £6,000 in cash I would draw the £6,000 in cash. Q. Out o f the £10,000 that you had received? A. Yes, and then do a journal entry fo r the abroad sums crediting one client with the £6,000 and debiting the other subject to whatever the exchange rate was etcetera. ’ When asked why he did not keep his clients’ float monies in a local deposit account, Mr Stakelum replied that it would attract attention: ‘Well the Revenue would be aware o f it fo r a start o f f .............. that there would have been deposit interest earned and there would be returns o f that made by the banks at that stage. ’ (see Appendix XII(b)). In keeping with the principles described earlier, M r Stakelum never gave his clients written information about where their money was on deposit, never gave them a receipt for their money, and never obtained from them a receipt when he repaid their deposit. was done on trust. Everything The effect of his operation of the hotchpotch accounts was that his clients could withdraw their funds in Ireland, while new clients could effect offshore deposits using Irish pounds. The bulk of Mr Stakelum’s clients operated through the hotchpotch accounts, with only a few exceptions being those who decided to take out back-to-back loans from Guinness and Mahon. and In each of these cases, a proportion of the hotchpotch account was separated out placed in an individual deposit that was hypothecated against the loan account. M r Stakelum’s arrangements with M r Traynor also enabled his clients to switch their funds between the sterling and US dollar hotchpotch accounts. 20.6 Location of Offshore Accounts Throughout his oral and written evidence to the Inspectors, M r Stakelum went to some lengths to persuade them that he did not know the location of the offshore account. As far as he was concerned, he merely gave the funds to Mr Traynor who moved them offshore. The Inspectors, therefore, have had to draw their conclusion as to the offshore location on the balance of probabilities. Several pieces of evidence point to an Ansbacher connection. First, M r Stakelum was asked in what offshore location the funds had been placed, and he replied: ‘A ll I know is that with Des Traynor I would have assumed Guinness Mahon Cayman Trust, later Ansbacher. But it could well have been College Trustees or Guinness and Mahon Guernsey. ’ (see Appendix XII(b)). In Mr Stakelum’s mind the choice was between Cayman and the Channel Islands. 20.7 Mr Stakelum’s clients and the Ansbacher connection In keeping with all the information he provided under the terms of a requirement by the Inspectors on foot of Section 10(2) of the Companies Act, 1990, Mr Stakelum listed the names of individuals who had entrusted him with the deposit of their funds. An examination of the records of Guinness and Mahon and IIB in the 1990s contains many letters of instruction from or on behalf of Mr Traynor for withdrawals from Ansbacher and Hamilton Ross to the account of Clyde Enterprises. A number of these contain specific references to individuals on M r Stakelum’s list. Further evidence of the link with Ansbacher arises from one of Mr Stakelum’s clients, Mr Gerard Keane, who accepted advice from Mr Traynor in connection with the purchase of a house for Mr Keane’s use in Dublin. Mr Traynor utilised some of M r Keane’s offshore deposit to fund a Channel Islands company to acquire the house. When, in due course, M r Keane purchased the house for himself using money borrowed from an Irish bank, the funds used to pay for the property were given to Mr Traynor who deposited them back into an Ansbacher account in IIB. From this evidence, supported by other examples, the Inspectors conclude that, on the balance of probabilities, the funds in Mr Stakelum’s sterling and US dollar hotchpotch accounts were deposited with Ansbacher. 20.8 Business Enterprises Limited and BEL Secretarial Limited Mr Stakelum was the controlling shareholder of Business Enterprises Limited (‘BEL’) and BEL Secretarial Limited (‘BEL Sec’). There is a considerable degree of apparent overlap in the records of Guinness and Mahon between BEL, BEL Sec and Clyde Enterprises, and so for the purposes of this report the Inspectors have taken all three to represent the common interest of M r Stakelum. An examination of the records of Guinness and Mahon and IIB in the 1990s shows that they contain many letters from or on behalf of Mr Desmond Traynor with instructions to withdraw sums from Ansbacher and Hamilton Ross accounts and to lodge them to the accounts of BEL and BEL Sec. According to a minute of a Guinness and Mahon lending committee dated 17 September 1976, BEL had a loan facility that was described as ‘suitably secured’. As outlined in Chapter 3, this phrase was used by Guinness and Mahon to describe loans backed by funds deposited with one of its subsidiaries outside the jurisdiction. The Inspectors conclude that, most likely, the backing security for the BEL loan was the hotchpotch deposit account. 20.9 Move away from Guinness and Mahon In 1987, Mr Stakelum felt that Guinness and Mahon were not providing him with the kind of service he had enjoyed previously, and also they were becoming expensive. resulted in his decision to open an account in Allied Irish Banks in Jersey. This From 1988, all funds of new clients were transferred to the new account while the funds of his earlier clients were gradually withdrawn from Guinness and Mahon. The details of this operation have not been investigated by the Inspectors on the basis that it is too remote from their terms of reference. 20.10 Conclusion regarding Mr Stakelum’s assistance of Ansbacher W hat is very evident from the method of operation of M r Stakelum’s deposit-monitoring service was his concern for secrecy, the minimal information he provided to his clients, the fact that people took all of this on trust and, finally, the use of the Clyde Enterprises Irish Pounds account as a conduit to the Ansbacher offshore account. In many respects, this mirrored the characteristics of M r Traynor’s modus operandi, including the use of the Amiens accounts in Guinness and Mahon to launder Irish pounds into sterling or other currencies. The Inspectors conclude that the aforementioned activities of M r Stakelum constituted assistance to Ansbacher in the carrying out of its Irish business. As Mr Stakelum’s detailed knowledge of Ansbacher’s Irish business was sparse, the Inspectors are of the view that such assistance was not knowing assistance. 20.11 Conclusion regarding Mr Stakelum’s services as a related matter For the reasons set out in this section of the report, including their close connection to Ansbacher’s Irish business, the Inspectors consider that the deposit taking and ‘monitoring’ activities of Mr Stakelum were themselves matters in respect of which the Inspectors should express a view, as being a related matter under their terms of reference. Specifically, the Inspectors have based their conclusions on the following factual matters arising from the evidence: 1) The finding that Mr Stakelum provided a deposit taking service; 2) The finding that the deposits were held offshore; 3) The finding that by Mr Stakelum provided a withdrawal service in Ireland; 4) The finding that Mr Stakelum made use of a non-interest bearing account for the purposes of hiding the business in question from the Revenue authorities, 5) The secrecy with which the service was carried out; 6) The experience of Mr Stakelum as a chartered accountant and business advisor. The Inspectors have concluded as a related matter that there is evidence tending to show that M r Stakelum, acting through Clyde Enterprises: (a) Carried out banking business in Ireland by facilitating the lodgement of funds of Irish Residents to overseas accounts in Ansbacher. (b) Provided a mechanism whereby Irish residents could withdraw their offshore funds in Ireland. (c) Carried out his business with intent to defraud creditors (that is, the Revenue authorities) of the depositors. 20.12 Criminal Offences The Inspectors have concluded that there is evidence tending to show that Mr. Stakelum, in undertaking knowingly the deposit taking activities described above, may have committed a number of criminal offences, as follows: I. The common law offence of conspiracy to defraud. II. The offence of knowingly aiding, abetting, assisting, inciting, or inducing another person to make or deliver knowingly or wilfully any incorrect return, statement or account in connection with their tax, contrary to the provisions of the relevant tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. III. That in accepting deposits from, and effecting withdrawals on behalf of his clients, Mr Stakelum may have carried on a banking business within the meaning of the provisions of the Central Bank Acts, 1971 and 1989 (see Chapter 5) and that he did so without the requisite licence. These possible offences are being reported on both as a related matter and as being a matter that has come to the knowledge of the Inspectors as a result of their investigation. CHAPTER 21 ASSISTANCE PROVIDED BY IIB INDEX Page Introduction 238 First Contact between Ansbacher and IIB 239 Opening of accounts 241 Procedures concerning residency declarations 242 The evidence in relation to the accounts 243 Arrival of Hamilton Ross 244 Back-to-back loans 245 Loan structure 246 Security 246 Evidence and submission of IIB on the security clause 250 Location and Source of Funds for Lyndon Property Transaction 253 236 Page 21.12 Doubts as to status of security 255 21.13 Request for re-designation as Trust Accounts 256 21.14 The involvement of Mr Sam Field-Corbett 258 21.15 Lodgements 259 21.16 Relative size of the Ansbacher activity 262 21.17 Knowledge within IIB 263 21.18 The evidence of IIB witnesses 264 21.19 Conclusions 264 21.1 Introduction From 1991 to 1996, IIB was the main bank in Ireland used by Ansbacher in the conduct of its business. The Inspectors have decided that, during the period of the IIB relationship, there is evidence tending to show that Ansbacher: 1. Carried on an unlicensed banking business in Ireland and/or; 2. Held itself out and/or represented itself as a bank or as carrying on banking business; and 3. Carried on its business in this jurisdiction in such a manner as to defraud the creditors (i.e. the Revenue authorities) of other persons. In this chapter, the Inspectors describe and analyse the relationship between Ansbacher and IIB and, in particular, the various services offered by IIB to Ansbacher. The Inspectors are satisfied that the provision of these services may be said to be the provision of assistance to Ansbacher, but, consistent with their approach to this part of their investigation, they have considered whether that assistance may be said to have been knowingly provided by IIB. In particular, the Inspectors have considered whether or not IIB knew that accounts held with IIB in the name of Ansbacher were in truth trust accounts holding monies for Irish residents. As appears from what is set out in the rest of this chapter, there is a body of evidence from which it might be concluded that IIB was actually aware of the trust nature of the accounts; but there is evidence also pointing to an opposite conclusion. This chapter considers all of the relevant evidence. 21.2 First Contact between Ansbacher and IIB It appears that the first contact between IIB and Ansbacher was initiated by Mr Richard Fenhalls. He was at that time the Managing Director of Henry Ansbacher & Co London, the parent company of the Ansbacher company in Cayman which is the subject of this investigation. The first meeting at which business was discussed in detail between Ansbacher and IIB is recorded in a file memo dated 22 November 1990 made by Mr Liam Donlon, an executive director of IIB. It appears to be central to an understanding of the later relationship. The complete memo and backing documentation is exhibited as Appendix Xm(a). The following is a relevant extract: ‘P McE and the writer met with Des Traynor at his request. Inter alia Des Traynor is chairman o f CRH but this meeting was in connection with his involvement in various trust companies, mainly Ansbacher Cayman Islands which is now 75% owned by Richard Fenhalls. Des outlined to us his interest in establishing a relationship with IIB fo r a number o f reasons: (a) The main purpose would be to have a bank which would hold on a continuous basis significant amounts o f funds, mainly Sterling but also other currencies as specified in a schedule given to us. The accounts which would need to exist would have various requirements - again these are set out in the schedule, including an indication o f the likely number o f transactions across the account. They would expect to receive reasonable market rates and would get quotes from time to time but not with a view to getting the best possible rate in the market as long as they were getting a fa ir rate. He would like us to respond as to what elements o f his requirements we could meet. He also has a need fo r back-to-back loans from time to time. As a sample o f these he gave us the accounts o f a company called Lydon [sic] and a copy o f a Facility Letter they had been offeredfrom Ansbacher. He told us that the details o f these various activities were dealt with by Padraig Collery, ex Guinness and Mahon who now works part-time fo r Des Traynor at his offices and that the best way to proceed would be to discuss details with him after we had come to some preliminary conclusions as to what we would like to do. He would like us to revert to him self directly in relation to the back-to-back loans, which we promised to do early next week. Action We are to consider his needs in how we can respond to them and arrange a detailed meeting with Padraig Collery and phone Des Traynor about the back-toback loans. ’ A week later, a memo from Mr Donlon dated 29 November 1990 records on this matter: 7 spoke to Des Traynor following our previous meeting. ’ I confirmed to him that we saw no problem in setting up the facility fo r Lyndon Properties on the basis o f a back-to-back loan o f £2 million at a margin 1%. I told him that we would envisage taking the deposit into Kredietbank London, as it is required to be in another jurisdiction. He was happy with that and asked that we should send him out the form s necessary. He will have Sam Field-Corbett who looks after the affairs o f this company contact us in regard to details o f the loan. We should proceed to get credit approval fo r this transaction a.s.a.p. need to agree a margin fo r KB London. We also I subsequently had a telephone call from Sam Field- Corbett. The facility is to be on a three year basis with interest rolled up fo r that period (both on the deposit and on the loan - although they are happy to pay the margin on a yearly basis). A meeting has been arranged fo r Tuesday, 4th December at 10.00am. In the meantime we are to process credit approval. ’ 21.3 Opening of accounts As a result of the above contact, Mr Desmond Traynor wrote to IIB on 10 December 1990, on Ansbacher Limited notepaper (with a reply address, 42 Fitzwilliam Square Dublin) enclosing application forms and other documentation necessary to open accounts in the name of Ansbacher Limited and Overseas Nominees Limited. The accounts were to be opened on 3 January 1991 with the transfer of STG£9 million. The following accounts were opened quickly thereafter: 8 January 1991: Ansbacher account re A/A26 0548 Sterling call deposit 8 January 1991: Swiss Fr. Call Deposit Ref CHV 08/02166/81 14 January 1991: US$ 14 January 1991: A$ 14 January 1991: DM 14 January 1991: Swiss Franc 15 January 1991: US$186,716.80 Call Deposit ref BZ 15 January 1991: US$139,777.04 do. A/A44 15 January 1991: US$ 18,391.42.do. ref A/B46 15 January 1991: US$ 42.617.31 do. ref A/A39 15 January 1991: US$ 614.272.89 do ref A/G 15 January 1991: US$ 20,089.87 do ref C/BT 15 January 1991: US$ 211,063.48 do ref A/B special 15 January 1991: US$ 21,112.40 do ref A/A35 The eight US$ accounts opened on the 15 January 1991 outlined above were subdivisions of one sum of US$1,254,041.21 sent to IIB on that day. Each of the subdivided sums was put on deposit on the same terms for the one customer of IIB, that is Ansbacher. No explanation has been given to the Inspectors as to why the money was so divided. The Inspectors conclude that the different sums represented the interest of particular clients of Ansbacher with the code denoting the hidden name of an individual client. The IIB witnesses contend, however, that this explanation never occurred to them. 21.4 Procedures concerning residency declarations The accounts were given different account numbers and notified by IIB to Ansbacher at 42 Fitzwilliam Square by letter dated 17 January 1991. Further accounts were later opened as required. At the time the accounts were opened, the procedure followed by IIB was based on its stated belief that the accounts were being opened by a non-resident bank and not by individuals. Because it was believed that these were transactions involving a bank, IIB formed the view that residency declarations were not necessary. In evidence, IIB accepted that if Ansbacher had been acting in the capacity of a trustee rather than a deposit owner, they (IIB) would have had to satisfy themselves as to the status of the beneficial owners of the funds. This would be necessary, according to Mr Tony Barnes, one of the Banks witnesses, to comply with the DIRT regulations. Another witness, Mr Liam Donlon, goes further and suggests that the bank would have had to take a ‘very different approach’ if they had received money on trust. The Inspectors note that, while Ansbacher was a registered bank in the Cayman Islands, an equally important objective in Ansbacher’s Memorandum of Incorporation was its business as trustee. IIB point out, however, that all banks carry on trustee business and that this is a normal part of a banks business. The number of accounts increased as the business developed. On 5 October 1992, five DM accounts were opened under the Ansbacher name all on similar terms. These were distinguished by use of the following codes, AC1, AC2, AC3, AC3A and AC5. The Inspectors have not uncovered any explanation for this duplication of accounts, each with the same depositor and terms, other than that each account represented the interest of different parties who were clients of Ansbacher. The Inspectors accept the evidence given by executives of IIB that such duplication may arise from time to time in inter­ banking transactions. This does not explain, however, the structured separation at the time of their opening of these accounts and the subdivided US$ accounts mentioned above. 21.5 The evidence in relation to the accounts The evidence in relation to the accounts shows: 1. Accounts were opened by a director of Ansbacher based in Dublin. 2. Back-to-back arrangements were an integral part of the business. 3. Accounts were opened for very specific sums, using coded references for identification purposes unique to that account, putting money on deposit on the same terms and for the same length as other coded accounts. (It should be noted that Mr Donlon gave evidence that he was not aware of these coded references). 4. The account holder was both a bank and a trust company located off shore. On 12 June 2001, and again on 27 and 28 February 2002, Mr Donlon gave evidence on behalf of IIB on the circumstances surrounding the opening of the accounts. A range of services were requested by Mr Traynor at a meeting with IIB officials, and Mr Donlon set these out in the note referred to earlier which he wrote following the meeting (see Appendix XHI(a)). IIB has pointed out that some of the services requested were not available through their bank, but, notwithstanding this restriction, the business was placed with IIB. The selectivity of the service being offered is relied upon by IIB as support for their view that this was ordinary business conducted in an ordinary way. Mr Donlon was questioned before the Inspectors as to whether his suspicions should have been aroused that the business was trust business (and therefore was possibly a vehicle for Irish residents evading tax). Mr Donlons position is well represented by the following answer: ‘ ...As I said before, it never crossed my mind nor was there any reason in my view that it should cross my mind that they would be trust money. ’ In evidence, it emerged that Mr Donlon did not know of the coded nature of the accounts. Mr Garrett Logan, then a relatively junior executive in Corporate Services, was aware of the codes together with such persons as monitored his incoming post. 21.6 Arrival of Hamilton Ross On 21 September 1992, Ansbacher instructed IIB as follows: ‘amend your records to show the deposits listed below as being in the name o f Hamilton Ross Co. Limited. Maturity dates remain as fixed. ’ There followed eight account numbers all in Sterling five of which had the same maturity date. The instruction came under the signature of Mr Desmond Traynor from 42 Fitzwilliam Square. The background to this change from Ansbacher to Hamilton Ross is described in Chapter 2 and Chapter 24. This instruction gave rise to a new set of potential problems. As mentioned above, IIB had decided that, as Ansbacher was a foreign licensed bank, it was not required to look behind its lodgements, and could make the working assumption that the money in the accounts it opened was owned by Ansbacher. Further, IIB had decided that a non­ residency declaration was not necessary, as it was dealing with another bank. From the receipt of the instruction to open accounts for Hamilton Ross, new considerations should have applied to those funds, as Hamilton Ross was not a bank but a company with ordinary Objects. IIB recognised this change and correctly asked for a non-resident declaration and for the Memorandum and Articles of Association of Hamilton Ross, but did not enquire as to the beneficial ownership of the funds lodged by it. IIB has maintained to the Inspectors that its knowledge was limited to the strict legal status of the accounts, and that the possibility that Hamilton Ross and/or Ansbacher were abusing IIB services had not occurred to them. After 21 Sept 1992, Hamilton Ross operated many accounts in the same currency and with identical maturity dates. The possibility that this company was operating accounts as trustee was not considered by IIB, according to their evidence. On the basis of the relevant officials evidence, the Inspectors accept that the correct banking practice would have been that, if IIB suspected that the money was invested on trust, they should have followed the procedure of seeking information on the true owners of the funds. If this was the banks view as to what constituted good practice, its failure to take any action arising out of the change of name on the accounts is surprising. By September 1992, a body of evidence existed which pointed to the true nature of the accounts of Ansbacher and Hamilton Ross. According to the evidence given to the Inspectors, the indicators listed above together with the Hamilton Ross change did not raise an issue in the mind of IIB as to the nature of their business. IIB officials at a senior level did not consider these matters, therefore the accuracy of the documentation held was not called into question. However, both at this time and later, the information available within IIB on the nature of the business they were assisting was not limited to the foregoing. Further examination of the method by which the accounts were operated is instructive in this regard. 21.7 Back-to-back loans Back-to-back loans were at the very centre of the business between the parties. The memo of 22 November 1990, at the time of the first formal contact states: ‘ He also has a need fo r back-to-back loans from time to time. As a sample o f these he gave us the account o f a company called Lyndon and a copy o f a facility letter they had been offeredfrom Ansbacher ’. The first back-to-back loan to be processed was for Lyndon Properties, an unlimited Irish company. A follow-up memo of 29 November 1990, from Mr Donlon mentioned that the deposit for this loan would be located in Kredietbank London, ‘as it is required to be in another jurisdiction ’. The Inspectors accept the evidence o f IIB that this requirem ent that the m oney be held abroad was IIB ’s requirem ent. 21.8 Loan structure The structure used for establishing this loan is set out in a letter dated 9 M ay 1991 from IIB to a firm o f solicitors in UK, Cam eron M arkby H ew itt, as follows: 1. Irish Intercontinental Bank provides a GBP2million loan facility to Lyndon Properties an Irish resident company. The terms o f the loan facility are covered in IIBs Facility Letter dated 28th January 1991,attached, and include a requirement fo r ‘ such other security in such form as shall be required by IIB, at its absolute discretion, from time to time ’. 2. KB London guarantees IIB fo r the loan facility to Lyndon Properties Guarantee dated 27 February 1991. 3. Ansbacher Limited (a Cayman Island company) counter-indemnifies KB London fo r the provision o f its guarantee to IIB - Counter-Indemnity dated 27 February 1991 4. As security fo r the counter-indemnity, Ansbacher Limited places a deposit o f GBP2 million with Kredietbank London, which is secured by a mortgage document - Mortgage on Monies dated 27 February 1991. 21.9 Security The way in w hich security was recorded in the Lyndon case had sim ilarities to the m anner in w hich security was dealt w ith in an earlier transfer o f an A nsbacher depositor from G uinness and M ahon to IIB. This earlier transfer was not organised by M r Traynor but was the result o f an independent third party decision. The firm in question decided in 1989 that it w ished to change its Irish banker from G uinness and M ahon to IIB. In the context o f the Inspectors assessm ent o f IIBs actions, its relevance is that the application to borrow m oney on a back-to-back basis (the deposit was to end up in London) created the sam e problem w ith regard to disclosure as surfaced later in the context o f Lyndon Properties and other IIB loans. In this first case, com pany X got a letter o f offer from IIB, w hich identified the security as a ‘g uarantee from a bank acceptable to IIB ’. The custom er rejected this clause and an alternative form o f words was used indicating that the borrow ing w ould be secured ‘in a manner acceptable to IIB ’ (see A ppendix XHI(b)). This arrangem ent was concluded before A nsbacher and IIB com m enced doing business. The problem o f properly describing back-to-back loans w ould arise again in the case o f Lyndon. The security to be provided by Lyndon Properties for the facility w as the subject of negotiation betw een the parties. A letter dated 13 D ecem ber 1990 to M r Sam Field- C orbett from KB enclosed a copy o f a draft facility letter. U nfortunately this letter is not available, but its contents are described in a m em o o f 29 January 1991 from Ms. Siobhan Lynch to M r John Reynolds. She expressed the view that ‘clause 5 o f the draft letter set out IIBs security requirement in more detail ’. It is clear she was com paring this to the actual clause in the facility letter dated 28 January 1991, w hich has the follow ing clause 5: LAny and all indebtedness or liability o f the borrower to IIB is to be secured by the guarantee o f M r Clayton Love and such other security in such form as shall be required by IIB in its absolute discretion from time to time. ’ This clause arose because M r D esm ond Traynor requested the deletion o f the reference to security in the facility letter. This request to delete all reference to security was refused. A n alternative to the om ission o f all reference to security was developed. The original clause 5 was replaced by the above quoted term. The key elem ent o f the new clause was that the back-to-back nature o f the security was hidden behind a com m itm ent to give HB ‘such security as it requiredfrom time to tim e\ IIB suggests that the form ula used was norm al in the industry. This m ay be so in circum stances w here available security is expected to fluctuate from tim e to tim e. U se of this form o f w ords appears strange, how ever, in circum stances w here a definite and perm anent m oney-based security had been agreed. It is clear that the purpose o f not setting out the full nature o f the security was to avoid it com ing to the attention o f som e other party. IIB suggests that the parties to be kept in ignorance w ere not necessarily R evenue authorities. This is a possible explanation but it is, at least, equally likely that R evenue authorities w ere the object o f the secrecy. The fact that IIB appeared to conceal the true nature o f the security appears to the Inspectors to be an im portant m atter w hen considering w hether or not IIB m ight be said to have know ingly assisted A nsbacher in carrying out its unlaw ful business in Ireland. The initial evidence from IIB w itnesses on this issue was som ew hat unsatisfactory and accordingly the Inspectors requested a considered position from IIB on this issue. U ltim ately, by letter o f 9 N ovem ber 2001, this was supplied as follows: 'Response o f the Bank to the Inspectors request fo r clarification o f the Security Clause ordinarily included within offer letter issued by the Bank to borrowers where guarantee was being provided by Ansbacher. ’ 1. The Inspectors query relates to the terms o f the security clause ordinarily included within an offer letter issued by the Bank to its customer where Ansbacher was providing a guarantee fo r that facility supported by its deposit. In particular, Mr. Rowan suggested that such a clause might be misleading to the auditors o f the borrowing company. Having regard to the nature and purpose o f the facility letter, as fa r as the Bank is concerned, this clause is not misleading. Further, the question o f whether a third party, such as an auditor, would review and/or rely upon such an offer letter or any o f its clauses form ed no part o f the Banks consideration when drafting the clause in question. 2. In order to properly respond to this issue, the Bank would like to clarify what its understanding is with regard to the purpose o f an offer offacility letter. In the Banks view, an offer letter is the document which sets out part o f a contractual position between a bank and its borrowing customer. So fa r as the Bank is concerned, it has no other function and is not required to, or intended to, have any other function. 3. For small personal loans, banks generally use standardised prescribed and in some cases pre-printed formats. For larger facilities, facility letters will be tailored fo r the individual transaction and will often be the subject o f negotiation and amendment between the bank and its client before a final form at is agreed and accepted. In the case o f the Bank, as it was generally involved in large scale lending transactions, facility letters were invariably tailor made and the negotiation and amendment o f facility letters was common and not considered unusual by the officers o f the Bank. That there is no standard or prescribed form at fo r facility letters is underscored by Lingard who states ‘the style o f facility letters varies widely from bank to bank and is often dictated by marketing considerations. ’ (J.R. Lingard, Banking Security Documents, 3rd Edition Butterworth). 4. So fa r as a bank is concerned, it must ensure the combination o f the facility letter, the guarantees and the security documents is such that the banks position is protected and provided the banks position is protected, and as alluded to by J.R. Lingard, it is o f little concern as to what is the wording o f a particular condition and whether particular conditions are met in a facility letter or in some other contractual document. 5. The type o f security clause used by the Bank in Ansbacher related lending was commonly used by the Bank and other reputable Irish banks, particular in the late 1980s/early 1990s. The particular clause was first used as regards to Ansbacher in the case o f Lyndon and was taken from a precedent agreement drafted by Arthur Cox. The use o f such a clause was in accordance with good banking practice and is not and was never intended to be misleading. 6. The Bank is not aware to what extent facility letters are (or were at the relevant time) reviewed by the auditors to borrowing companies. However, in drafting a security clause, the Bank was not conscious o f how third parties, including auditors, might interpret the clause. The Bank is not aware o f any instance where an auditor has contacted the Bank to seek clarification o f the wording o f a facility letter either in the case o f Ansbacher or in relation to the Banks business generally. So fa r as the Bank is aware, the only point o f contact fo r financial institutions with the auditors to borrowing companies is through the specific audit request sent by the auditors to the borrowers bank, the form o f which has been prescribed by the Institute o f Chartered Accountants in Ireland and the Irish Banks Standing Committee and the Northern Ireland Bankers Association. This document is explicit as to what information is to be furnished and, in particular, how third party guarantees are to be dealt with. Such an audit request is signed by the borrower and amounts to a very specific authorisation from the borrower to its bank to provide certain information to the borrowers auditor. The Inspectors reject the contention that it could be assumed that third parties, such as an auditor, would neither review and/or rely on an offer. This contention in the above letter is immediately contradicted by other contents of the same letter. For example, at paragraph number 2 above, the bank writes that the purpose of the facility letter is to form part of the contract between the bank and its customer. In that capacity, it is a vital document in the audit process, a fact well known to any senior bank official. The Inspectors are convinced neither by the point that the clause in question was used by the ‘bank and other reputable Irish banks’ nor by the status of the firm which drafted it. The clause could be unexceptional in the proper context but not, in the Inspectors view, in the way used by IIB in the absence of an acceptable explanation. 21.10 Evidence and submission of IIB on the security clause The m atter was further canvassed in later evidence and in subm issions from IIB. The follow ing is a sum m ary o f IIBs evidence and subm ission1 ‘The request made by Ansbacher in connection with the security clause in the Lyndon facility was to remove the security clause altogether. The request was made at a very early stage in IIBs relationship with Ansbacher and was made to M r Liam Donlon. M r Donlon declined to remove the clause because it was to be a secured facility but he requested Ms Siobhan Lynch to see i f the client could be otherwise facilitated. She came up with a general security clause that did not make specific reference to the actual security while at the same time making it clear that there was security. This clause had been used many times in the past by IIB and many times since and is not unusual in banking. It may well be that the Inspectors may now view the Ansbacher request relating to the security clause as suspicious in the light o f information now available to them about Ansbacher. However it is submitted that it is unreasonable and unrealistic to suggest that IIB personnel should, on the information available to them, have drawn ... any adverse conclusions based on this request. On the contrary the evidence establishes; 1. That it was common fo r people to negotiate clauses in draft facility letters including security clauses 2. That it was normal fo r a bank to have a general security clause which did not make reference to the specific security provided This is extracted from the final submission document presented to the Inspectors on 20 March 3. That the bank had in the past used such general clauses where specific security had been agreed and provided. 4. That on receipt o f the request by M r Donlon he passed the matter over to Ms Siobhan Lynch (who was the manager o f the documentation unit in the bank which was within M r Donlons area o f responsibility) to see i f the request could be accommodated and she came up with the general formula o f words that was in fa c t used. 5. That M r Donlon did not have any interest in M r Traynors reasons fo r requesting, the deletion o f the security clause. His only concern was to protect the banks position. 6. That the clause inserted in the Lyndon facility letter subsequent to M r Traynors request was a clause that had been used by IIB on many previous occasions with other customers. 7. That the reason the general clause was used in the Lyndon case was to facilitate a requestfrom M r Traynor. The Inspectors have requested IIB to speculate as to the reasons why somebody might wish to have no reference to a specific security in a facility letter. Various IIB witnesses have suggested the following possible reasons. 1. The bank offering, the guarantee might not wish the borrower to know that its guarantee was cash backed by a cash deposit because it might adversely reflect on the banks credit standing. 2. The bank offering, the guarantee might wish to avail o f the facility to restructure the security backing, the guarantee without the necessity to involve the borrower or even let the borrower know o f its internal arrangements 3. The bank offering, the guarantee might wish to seek better terms from another bank but might not wish to disclose to such other bank the precise security it had agreed with the other bank 4. The borrower might not wish the management at certain levels within the borrower to know o f the cash backed nature o f the guarantee as a form o f management o f financial discipline to ensure that management strove to perform in an optimum fashion. 5. I f the borrower had a number o f facilities from different banks it might not wish one bank to be aware o f the exact security held by another bank with a view to optimising its own negotiating position when seeking further facilities It could o f course be the case that a borrower might not wish to disclose the cash back security i f it was engaged in tax evasion and considered that the cash back facility might in some way alert the Revenue Commissioners to such activity ’. The Inspectors have considered all of the evidence and submissions from IIB on this issue. They conclude that the concealment of the true nature of the security was motivated by a desire on the part of Ansbacher and Ansbacher’s clients to conceal the real position from Revenue authorities. They accept, however, that this may not have occurred to IIB as being the motivation of Ansbacher and they accept, that IIBs primary concern was to ensure the validity and effectiveness of its security. 21.11 Location and Source of Funds for Lyndon Property Transaction As early as 29 November 1990, the wish of Ansbacher to have the back-to-back funds located abroad was noted in the records of IIB. When the facility was put in place, this was accomplished by the transfer of Ansbacher funds in the sum of STG£2 million from IIB to a new account in Kredietbank in London. Lyndon (in Ansbacher’s name) by IIB. A loan cheque was then issued to Lyndon in turn lodged this cheque back to Ansbacher. Kredietbank London then apparently made a separate and matching deposit back to IIB. The result was that a ‘loan’ was created in the books of Lyndon Properties, which could be drawn down to, in effect, make available offshore money of Lyndon or Lyndon’s principal previously unavailable to it. The circular nature o f the m ovem ent o f m oney can be seen from an exam ination o f a letter and schedule dated 25 February 1991, w hich gives final instructions to M s Siobhan Lynch, M anager B anking at IIB. The author o f the docum ents is M r D esm ond Traynor. The schedule sets out the system to be used for com pleting the drawdown. It provides: 1. ‘J.D.T. to provide a letter dated Wednesday 27th instructing IIB to transfer Stg.£2million ex Ansbacher Limited Account No. 02/01087/81 to Kredietbank fo r deposit to a new account in the Name o f Ansbacher Limited. 2. IIB to issue a cheque payable to Ansbacher Limited and debited to Lyndon Properties Loan Account. A t the same time Sam Field-Corbett to issue a letter to IIB authorising and requesting IIB to so issue the cheque. 3. Sam Field-Corbett will then pass to J.D.T. this cheque, which J.D.T. in turn will lodge to Ansbacher Limited Call Account No. 02/01087/81. ’ The m oney used for the creation o f the deposit in London cam e from an A nsbacher account in Dublin. Similarly, all deposits used for back-to-back loans later com pleted appear to have had their origin in A nsbacher’s Irish deposits. Part o f the evidence o f M r Liam D onlon, on w hich IIB depends in addressing the Inspectors concerns on this point, relates to the follow ing question and answ er in the course o f his evidence: ‘Q. D id M r Traynor indicate to you in the course o f this conversation or at any time that it was his intention that the money used to cash back in London would be taken out o f deposit, which were going to be made in Dublin? A. No, he certainly never mentioned that and indeed I was not aware o f it fo r many years after that. ’ It is clear, however, from the document referred to above that Ms Lynch, who was in a managerial position, was fully aware of the source of the funds transferred to London. It is a feature of Ansbacher’s relationship with IIB that no one person in IIB acquired a complete picture of the relationship between the parties. Rather, different people at different levels within IIB were appraised of particular matters concerning Ansbacher. Notwithstanding the established facts, IIB maintains that it failed at any level to recognise that these transactions might suggest that the funds in question were really lodged by Ansbacher in trust for specific people. For the sake of completeness, two lists dated 22 July 1993 and 3 January 1996 are attached at Appendix XHI(c). These show the range of back-to-back loans involving HB at each date. Three of the loans were based on cash deposits in London (like Lyndon Properties), while in the remainder of cases the deposit was in Ireland with HB in the name of Ansbacher. 21.12 Doubts as to status of security When the money was received in HB in Dublin in 1991, there appears to have been no concern as to its legal status. No query was raised, HB having concluded that the new deposits were money beneficially owned by another bank. This assumption continued on and after the arrangement of the loans for Lyndon Properties, Carlisle Trust and Alstead Securities, which involved deposits in London with Kredietbank backing loans in HB. However, doubts surfaced in 1991 relating to the status of the security and the letter to Cameron Markby Hewitt a firm of solicitors in London, quoted above, sought legal advice on the effectiveness of the security. The problem was not resolved for some time. The legal advisers of other parties were also consulted. The ultimate legal advice was that loans should be backed by funds lodged by Ansbacher not as owner but as trustee for the beneficial owner. HB fully participated in this process and on 24 June 1993 wrote to Ansbacher explaining what had occurred in London concerning the trustee status of the money lodged. At that stage, HB knew that money previously held by them in the name of Ansbacher and sent from their Ansbacher account to Kredietbank in London was of such a status that it could be re-designated as trust money. The Inspectors raised this point with IIB and received a detailed response. This is attached at Appendix Xm(d). The Inspectors do not accept that it was ever possible from a practical operational standpoint to make this change without the client knowing. If IIB did not tell the borrower, it is extremely likely that the guarantor would so do. In fact, what happened was that two companies were used which were the operating companies of the trusts controlled by the Irish borrowers or their immediate families. The Inspectors questioned Ms Lynch on the method by which funds could be legally transferred to another party when they had been previously beneficially owned by the original depositor. Ms Lynch’s explanation that the transfer to the two new companies was merely an accounting transaction is not convincing as an explanation. However, the Inspectors do not conclude from the unconvincing nature of the explanation that Ms Lynch was actually aware of the true status of the fund. Rather, they conclude that it ought to have occurred to those familiar with this transaction, had they considered the issue, that the residual funds, which remained on deposit in IIB and which were the source of the designated funds, may have been initially deposited by Ansbacher on a trust basis. 21.13 Request for re-designation as Trust Accounts The question of the possible trustee status of the Ansbacher deposits in Ireland was also raised in a domestic context. On 5 June 1992, Mr Desmond Traynor wrote on Ansbacher headed notepaper as follows: 7 would be grateful i f this Deposit Account presently standing in the name o f Ansbacher Limited could be designated ‘ Ansbacher Limited in Trust re T 7033 ’ and not included in any audit confirmations to Ansbacher. I would be grateful i f you would confirm that this is in order. I f you have any concerns I would appreciate i f you could ring me. ’ This request related to a deposit securing a loan to Mr Ru Leonard. 2 The request to re­ designate accounts must have been made a second time, as an internal memo of 12 June 1992, in further dealing with the above request, refers to this case and one other, S M Morris Limited. The memo is exhibited at Appendix XUI(e). An examination of the memo discloses both the account name and the account code, showing that the author Claire Gannon was privy to the fact of the connection between code and account name. HB initially sought to point to the fact that it did not actually re-designate the accounts. This reaction missed the reason for the importance the Inspectors attach to this communication. The significance of this documentation does not lie in whether the request was implemented but rather in indicating the evidence available to IIB of the true status of the deposits and in indicating the actual state of knowledge of IIB in relation thereto. In its evidence to the Inspectors, IIB put considerable emphasis on its belief that the purpose for which the request was made related to the desire of Mr Traynor to exclude the funds from Ansbacher’s balance sheet. The Inspectors accept that this was the likely motivation; however, the reason it was requested is not the point of interest. The fact that funds could be re-designated as trust funds by Ansbacher for its convenience indicates the true nature of those funds. Another IIB witness, Mr Paul Naessens said it was not appropriate to re-designate the account as a trust account because Ansbacher beneficially owned the funds. He also said: 7 was certain o f that really because o f the overall background knowledge and how the transaction was put together and the documents that Ansbacher signed and so forth ’ Notwithstanding this cash-backed loan, Mr Leonard has not been found to be a client of Ansbacher, as the Inspectors are satisfied that his loan was backed by funds beneficially owned by a third party. Evidence was also given by Mr Naessens and others that the request was driven by a desire to keep the fact of the back-to-back loans off Ansbacher’s balance sheet and off the balance sheet of its ultimate owners. This aspect of the relationship between IIB and Ansbacher is the subject of a submission by IIB which is exhibited at Appendix X E(f). The suggestion of Mr Liam Donlon and others that the request to change the name of an account from ‘Ansbacher’ to ‘Ansbacher in Trust re T.033’ does not raise an inference that the money was deposited in trust is rejected 21.14 The involvement of Mr Sam Field-Corbett Other circumstances existed which may assist in assessing by inference the state of knowledge of IIB on the true status of the deposits held by them under the name of Ansbacher. Two such matters relate to the activities of Mr Sam Field-Corbett. One of these relates to his personal involvement, the other to his role as a business adviser to many of those who were active in business at this period. In a personal capacity, Mr Field-Corbett, together with two others, applied to IIB for a loan in the sum of IR£120,000 in November 1991. purchase property in Dublin for letting. The purpose of the loan was to The application was the subject of a written recommendation to the IIB credit committee. This document was signed by Mr John Reynolds and approved by the credit committee under the signature of Mr Donlon and another director. The executive summary with which the document concludes contains, inter alia, the following paragraph: ‘The proposal will be secured by a cash deposit being moneys entrusted to Ansbacher Ltd by M r Field-Corbett and as such, Messrs [name deleted] and [name deleted] are not aware o f the cash-backed arrangement and M r FieldCorbett has requested that the documentation be drafted on the basis o f a normal commercial rate say 3 /2% as opposed to the margin justified by the deposit ... While the transaction is small it is requested by M r Field-Corbett who, with Des Traynor, has been instrumental in placing substantial cash backed business with us to date.’ [Inspectors emphasis and deletions] The loan was approved but, in accordance with IIB practice in Ansbacher related loans, the facility letter did not have any reference to the backing deposit. When first interviewed, neither Mr Reynolds nor Mr Donlon could give any explanation as to the meaning to be attached to the words underlined above. In later evidence, Mr Reynolds suggested that the reference was an error in drafting and that the true arrangement was that Mr Field-Corbett had placed a deposit with Ansbacher in consequence of which Ansbacher was now prepared to offer the guarantee. Mr Reynolds said it was not his understanding that the money over which the lien would be given was the same money as Mr Field-Corbett had deposited. The Inspectors conclude that Mr Reynolds is incorrect in believing that the money over which the lien was to be given was not the same money as that which had been deposited by Mr Field-Corbett. They accept, however, that that was his honest belief. In this case, the fact that Mr Field Corbett was the beneficial owner of certain funds used for his back-to-back arrangement should have been clear to all IIB officials. These events took place before the end of the first year of Ansbacher’s deposits in IIB, but no reappraisal of the operation took place as a result. The second matter involving Mr Sam Field-Corbett relates not to his personal affairs but to his business activity. In this regard, attention is focused on certain Ansbacher accounts coded A/A26. Mr Field-Corbett was used by Mr Traynor as a conduit by which information about these accounts was sent to Australia on a weekly basis. The ownership of these accounts is unknown. The Inspectors have considered whether the nature of the instructions given in relation these accounts should have alerted IIB as to the trust nature of these accounts. The Inspectors are satisfied that no such inference arises. 21.15 Lodgements The Inspectors have had the benefit of correspondence between the Central Bank of Ireland and IIB in September 1997 and, thereafter, arising from the McCracken Tribunal and dealing with matters relating to IIB’s Ansbacher business. Copies of a Central Bank letter of 8 September 1997 and IIB’s reply dated 11 September 1997 are attached at Appendix Xm(g). The Central Bank letter includes the following extract: ‘A s an Authorised Dealer your bank was required to verify on the opening o f such accounts the residential status o f the beneficial owner(s) o f the accounts in question. In addition it would appear that the instructions to open and operate these accounts were received from Irish residents who also carried out transactions across the relevant accounts. ’ The reply of IIB included the following: ‘In all cases, lodgements into the accounts were from off-shore sources. ’ The Inspectors have examined the lodgement pattern to the accounts maintained in IIB under the names of Ansbacher and Hamilton Ross. In particular, the Inspectors considered lodgements to the main Ansbacher Call Deposit account 02/01087/81 and the main Hamilton Ross Call Deposit account no 02/01354/81. Money arrived in these accounts by a variety of methods. In the early part of 1991, funds were transferred from Guinness and Mahon via the Royal Bank of Scotland. Later, funds from a number of sources were lodged. The Inspectors have selected a number of lodgements as examples of the methods and sources used. The first example is a cheque in the sum of STG£9,000 payable to Anthony Barry on behalf of Bluehill Investments Limited. The cheque was drawn on a bank in Guernsey. The evidence of Mr Barry is that he gave this cheque to Mr Traynor to be lodged in an account abroad. The money was received in Dublin and lodged in IIB through the normal method used by IIB to handle sterling cheques. IIB indicated to the Inspectors that, in this and other cases, it did not know of the tax status of the payee and submitted that IIB was entitled to lodge this cheque in the normal way. This and other cheques lodged have considerable significance in the context of whether Ansbacher was unlawfully banking in Ireland and whether IIB was assisting in that operation. They also have significance in assisting the Inspectors to decide whether IIB knew that the accounts to which the lodgements were being made had the characteristics of trust accounts. IIB in evidence submitted that they did not know from the face of the transaction that the funds in question had a source (Mr Barry) within Ireland. Similar submissions were advanced in respect of other lodgements, for example an Ulster Bank draft (College Green Dublin Branch) to Ansbacher in the sum of STG £85,620.44, and an Allied Irish Bank draft (Rathgar Branch) STG £455,500.00. These submissions, even if accepted, do not cover other lodgements. An instruction in IIBs files provides details of a sum of STG £735,178.60 from Ulster Bank Ltd Dublin and shows the source as Clayton Love Distribution, which was a well-known Irish company. The receipt of these funds might and perhaps should have alerted IIB to the possibility that money was being received from Irish sources and that the Ansbacher funds it held may have been trust funds. Two other lodgements (of those examined by the Inspectors) might and perhaps should have given rise to similar concerns. Money was lodged into Hamilton Ross via a cheque (payee College Trustees & Co) from County Fair Foods Ltd in the sum of IR£1,777,500.00. This money had an Irish source and the suggestion from IIB that it might be from a non-resident IR£ account is not accepted. In April 1994, a Hamilton Ross account was credited with the proceeds of an IR£211,000.00 cheque drawn on the Irish account of Ballymadun Stud. In this case, the cheque had been made payable to IIB itself. By way of further example of the lodgement system (in this case relevant to the possible operation of a bank in Ireland by Ansbacher), the Inspectors considered a transaction involving a London based lady, Mrs Nora Shanahan. This was a £30,000 Bank of Ireland sterling draft in the name of Mrs Shanahan. This was accepted by Mr Traynor in Dublin and sent forward for lodgement to Ansbacher account 02/01087/81. It is clear that this was a third party instrument accepted into Ansbacher’s control in Ireland and lodged to Ansbacher’s account in Dublin. This is evidence of Ansbacher accepting funds in Ireland, for which they needed a licence. The foregoing are examples but, as pointed out by IIB, are not representative of the bulk of the lodgements, which typically came from apparently external sources. However, Mr Traynor, from his office at 42 Fitzwilliam Square, controlled lodgements to and withdrawals from the accounts. Thousands of letters were dispatched from that address under the Ansbacher notepaper with the Irish address super-imposed by a sticker. The bulk of the correspondence of which the Inspectors are aware went to IIB. Ansbacher was a name associated with banking and those in authority within IIB should not have been in any doubt as to the significance of that name. The question may well be asked what was Mr Traynor doing from 42 Fitzwilliam Square if he was neither banking or holding himself out as a banker? The Inspectors do not accept the suggestion by IIB, that Mr Traynor was acting in a manner consistent with being a local representative of a foreign bank. 21.16 Relative size of the Ansbacher activity The Inspectors are indebted to IIB for an analysis which puts the Ansbacher/Hamilton Ross accounts into context. This analysis is attached at Appendix Xm(h), and reference should be made to it for a fuller understanding of the matter. The following is a summary of the main features: Period 1991 to 1997 Number of Ansbacher credit entries 2215 Inter accounts transfers 1568 Number of lodgements 647 Average lodgements 1991-1993 129 per annum Transfers and bank drafts from banks and third 443 value IR£87 million parties 1991-1997 Of which 30 value IR£5.15 million Irish Bank originated Guinness and Mahon 32 value IR£9.57 million Foreign Bank Originated 371 value IR£72.32 million Withdrawals 1991 to 1997 Irish Currency Value IR£8 million Foreign Currency Value IR£88.1 million IIB has stressed to the Inspectors that the number of transactions should be seen in the context of total credit entries in IIB at that time in the region of 40,000 per annum rising to 50,000 per annum in the years 1991 to 1997. The number of credit entries to the Ansbacher accounts is significant when answering in the affirmative the question as to whether or not Ansbacher was conducting a banking business in Ireland. However, the Inspectors acknowledge that, from an IIB perspective, the level of Ansbacher activity was very small when compared with the general business of IIB. This conclusion is of significance when considering whether IIB can be said to have knowingly assisted Ansbacher. The Inspectors accept the general proposition that in circumstances where the Ansbacher activity represented a small proportion of IIBs business at any given time IIB was less likely to be fully cognisant of the true nature of Ansbacher’s business than it might have been had the Ansbacher activity represented a greater proportion of its business. 21.17 Knowledge within IIB If the Inspectors were to aggregate all of the evidence available to IIB and attribute knowledge of that evidence to persons within IIB who could be said to represent the mind and will of IIB, then the Inspectors would have little difficulty in concluding that IIB was actually aware of the true nature of Ansbacher’s business in Ireland and that therefore the assistance which IIB provided to Ansbacher ought to be characterised as knowing assistance. However, that is not the reality. In fact, knowledge of the information which is described in this section of the Report was fragmented within IIB. Not once did the Ansbacher business warrant mention at meetings of the Board of Directors of IIB. Certainly, some information which might have prompted further questioning of the nature of Ansbacher’s business was available to executive directors and associate directors but other significant information was available only to more junior people in the organisation. The fragmented nature of this knowledge is not surprising given that the Ansbacher business straddled both the lending side of banking and the deposit side of banking. Furthermore, the fact that the Ansbacher business was relatively minor in comparison with IIB’s other business lends further credence to the proposition that no person or persons within IIB who can be said to represent the directing mind and will of IIB was actually aware of the true nature of Ansbacher’s business. 21.18 The evidence of IIB witnesses The Inspectors have considered and given considerable weight to the sworn evidence of all those who testified on behalf of IIB. Without exception, they were assessed as truthful and, except in one unimportant case, helpful. Without exception, they testified that they did not know the nature of the operation being carried on by Ansbacher in Ireland. It should also be said that the Inspectors have received considerable co-operation from IIB in conducting this investigation. Many of the documents relevant to the issues under investigation within the possession of IIB were released promptly and efficiently when requested. IIB employees responded to requests from the Inspectors for further assistance in a model manner. Given this assessment of IIB and its witnesses and given the Inspectors assessment of the other evidence suggesting knowledge on the part of IIB, the Inspectors must conclude that IIB was not actually aware of the true nature of the Ansbacher activities in Ireland. 21.19 Conclusions Having considered all of the relevant evidence and submissions and having regard to the relevant legal principles regarding corporate knowledge, the Inspectors conclude as follows: 1. The assistance rendered to Ansbacher by IIB was an essential part of the Ansbacher operation in Ireland from 1991 to 1997. Without that assistance Ansbacher could not have operated in that period in Ireland 2. There existed within IIB a substantial body of knowledge concerning the status of the Ansbacher accounts (and the general business being conducted) which if co-related would have alerted IIB to the possibility that Ansbacher was operating as a bank (and/or holding itself out as a banker and/or holding itself out as carrying out banking business) contrary to the Central Bank Act 1971 as amended and/or conducting its business in such a manner as to assist some of its clients in defrauding the Revenue authorities. 3. As a matter of fact, this knowledge within IIB was not concentrated in such a way as to enable corporate knowledge to be imputed to IIB. 4. The Inspectors have concluded that they should report on the relationship between IIB and Hamilton Ross as this represents a continuation of the Ansbacher business. Such a report falls within paragraph (e) of the High Court Order of 22 September 1999 as a related matter. The Inspectors further conclude, therefore, that from the time that Hamilton Ross was substituted as account holder, the relationship between IIB and Hamilton Ross was a continuation of the relationship between IIB and Ansbacher. In so far as it is necessary, the same conclusions apply as those outlined above. PART THE CLIENTS OF ANSBACHER (CAYMAN) LIMITED 266 IDENTIFICATION AND CATEGORISATION OF THE CLIENTS OF ANSBACHER (CAYMAN) LIMITED INDEX Page Caveat 269 22.1 The Inspectors’ approach to the identification of the clients of Ansbacher 270 22.2 The question of the possible tax liabilities of clients 270 22.3 Definition o f ‘client’ 271 22.4 ‘Fundless’ clients 273 22.5 Excluded clients 273 22.6 Composition of client list 274 22.7 State of knowledge of Ansbacher clients 274 22.8 The various categories of clients 275 22.9 Persons who beneficially owned funds in Ansbacher (Category A). 275 Page 22.10 Persons who were clients of Ansbacher through College Trustees (Category B). 275 22.11 Persons who were clients of Ansbacher through Mr Jack Stakelum (Category C). 277 22.12 Persons whose sole involvement was the establishment of Ansbacher trusts to which they never transferred any assets (Category D). 277 22.13 Persons for whom Ansbacher conducted business other than the holding of funds (Category E). 277 CAVEAT It is important to bear in mind that a finding that any particular individual is a client of Ansbacher, is NOT a finding that that person has evaded tax. As will be seen further on, persons who have been identified as clients did not necessarily have deposits with Ansbacher. Some such persons simply borrowed money from Ansbacher in the ordinary course of business, a transaction giving rise to no tax liability whatsoever. Others again established trusts to which they never transferred any assets. IDENTIFICATION AND CATEGORISATION OF THE CLIENTS OF ANSBACHER (CAYMAN) LIMITED 22.1 The Inspectors’ approach to the identification of the clients of Ansbacher The High Court Order of 22 September 1999 appointing the Inspectors required them, at paragraph (b) ‘to identify as fa r as possible all o f the parties who were ... clients o f the Company.... ’ The Inspectors, mindful that their statutory duty was to examine the affairs of Ansbacher, considered it necessary to seek the directions of the High Court in relation to the true meaning and interpretation of the Order of 22 September 1999, in so far as it might have been interpreted as directing the Inspectors to investigate and report upon the clients of Ansbacher. Accordingly, by application made to the High Court in camera on 13 March 2001, the Inspectors sought directions pursuant to section 7(4) of the Companies Act, 1990. By Order of the same date, Mr Justice Johnson directed that in discharging their obligations to the High Court, the Inspectors were required to investigate and report upon the clients of Ansbacher only in so far as was necessary to do so for the purpose of examining and defining the nature and extent of Ansbacher’s Irish business, for the purpose of identifying the clients and for the purpose of examining the affairs of Ansbacher. A copy of the Order of Mr Justice Johnson will be found at Appendix XIV(a). 22.2 The question of the possible tax liabilities of clients By the date of the making of the Order of 13 March 2001, the Inspectors had already interviewed a significant number of persons. Approximately half of those interviewed readily admitted that they had availed of Ansbacher’s services for the purposes of evading their tax liabilities either in Ireland or elsewhere. Others, although unaware that they were clients of Ansbacher, were aware that their funds were offshore, and admitted that they had not disclosed the existence of their offshore funds to the Revenue Commissioners. The Inspectors are satisfied that it was necessary to investigate persons for the purpose of confirming their identification as clients. They are satisfied that it was also necessary, in order to gain an understanding of the nature and extent of Ansbacher’s business, to enquire whether clients had availed of Ansbacher’s services for the purpose of evading tax. However, by the date of the making of the Order of 13 March 2001, the Inspectors were satisfied that they had a proper understanding of the nature and extent of the business, and that any further investigation into the tax liabilities of individuals would be superfluous. Accordingly, with effect from 13 March 2001, the Inspectors ceased to make enquiries about the tax liabilities of the persons they interviewed, directing their attention solely to the question of whether such persons were or were not clients of Ansbacher. For the purposes of this report, therefore, the only finding the Inspectors have made in relation to the individuals examined is that they were clients of Ansbacher. It must be borne in mind when reading the list of clients, that in relation to a considerable number of persons, the Inspectors have made no enquiries as to their tax liabilities, and the Inspectors do not know whether in fact certain persons on the list have any tax liability at all. 22.3 Definition of ‘client’ A second difficulty arose for the Inspectors in relation to the identification of clients namely, how should they define a client? The matter was complicated by the fact that, frequently, the beneficial owner of funds in Ansbacher was protected by a company, or more than one company, which was the legal or nominal owner of the funds. As related elsewhere, the Inspectors are satisfied that the true client was the person in control of the funds. They therefore decided to adopt a practical approach, and have defined a client as follows: For the purposes o f their investigation and having regard to the contents o f the Order o f the High Court dated the 22 September 1999, the Inspectors consider a person to be a ‘client’ o f Ansbacher (Cayman) Limited ( ‘the Company) within the meaning o f the Order i f business was carried out fo r that person by the Company in the State or, in the case o f a person who is an Irish resident, i f business was carried out fo r him by the Company anywhere in the world. In particular, but without prejudice to the generality o f the foregoing, a client shall include: a) Any person who directly or indirectly maintains or has maintained all or part o f any account with the Company or who has or had de facto or de jure control over all or part o f any account with the company. b) Any person who has or had de jure or de facto control o f a body corporate which directly or indirectly maintains or has maintained an account with the Company or is or was administered by the Company or which has had borrowings directly or indirectly secured wholly or partly by the Company. c) The Settlor o f any trust administered by the Company or o f which the Company is or was the trustee and/or any other person or persons who funded such a trust or caused such a trust to be funded. d) The Beneficiary o f any trust administered by the Company or o f which the Company is or was the trustee in circumstances where the beneficiary has or had de jure or de facto control over all or part o f the trust funds. e) Any person who had an account relationship with a body corporate owned or managed by the Company. The expression ‘account ’ shall include deposit accounts, loan accounts, securities accounts and custodial accounts. ’ 22.4 ‘Fundless’ clients From the definition above, it will be clear that it was possible for a person to be a client of Ansbacher without necessarily having placed any funds offshore. The Inspectors have identified, among the clients of Ansbacher persons for whom Ansbacher transacted business in the ordinary course of banking, such as by providing them with loans. Other persons caused trusts to be created under Ansbacher’s management, but never transferred any funds to those trusts. The Inspectors have included such persons in their client list, on the basis that they were persons for whom Ansbacher carried out business. 22.5 Excluded clients The Inspectors have not included Irish persons who, although Ansbacher clients, are not resident in Ireland, and for whom Ansbacher did not conduct business in Ireland. The business carried out by Ansbacher for such persons does not come with in the meaning of ‘Irish business’ as defined in the High Court Order of 22 September 1999 (see Appendix 1(a)). Certain other persons whose names might have been expected to appear in the list have been omitted, and this requires some explanation. As explained later in this Report, not all persons who had funds with College Trustees Limited fell within the remit of the Inspectors, but only those whose funds, during the period 1981 - 1989, were lodged in an account in Guinness and Mahon entitled GMCT re College Trustees. Neither did every person whose loan was described by Guinness and Mahon as ‘suitably secured’ fall within the Inspectors’ remit. It became clear to the Inspectors during the course of their investigation that this phrase was used by Guinness and Mahon to describe a loan backed by a deposit with any of its subsidiaries outside the jurisdiction - including, for example, its Belfast subsidiary. Again, certain persons who have been named in various publications as being clients of Ansbacher do not appear on the list. This is because the Inspectors, after careful examination, have found that the evidence does not suggest that such persons were clients of Ansbacher. 22.6 Composition of client list The Inspectors had a further difficulty, arising from the fact that, due to the ruling of the Cayman Court, they were unable to obtain a list of clients from Ansbacher itself. The Inspectors’ list of names has been put together from non-Ansbacher sources and therefore is not complete. It is impossible to assess with total accuracy the number of names not identified. All the information available to the Inspectors would suggest that the vast majority of clients have been identified. All those in respect of whom the Inspectors concluded that they were clients have been contacted, except where no address was available. In the case of deceased persons, the personal representative, legal adviser or nearest living relative has been informed, where possible. The Inspectors sent each person a preliminary conclusion, which included the evidence on which the conclusion was based. The person concerned or their representative, was invited to make representations or adduce further evidence or cross­ examine witnesses, as appropriate. Where representations were received or new items of evidence tendered, these were considered carefully before the Inspectors arrived at a final conclusion. 22.7 State of knowledge of Ansbacher clients Many persons have testified that they did not know that they were clients of Ansbacher and this has occasionally been the subject of unfavourable media comment. However, the pattern is so widespread and the truthfulness of the witnesses so apparent, that the Inspectors have concluded that some persons who were depositors did not know that they were clients of Ansbacher. It appears that in many cases the relationship between the depositor and Mr Desmond Traynor was such that money was entrusted to him without any formal paperwork and without any indication of its ultimate destination. The persons, of course, by and large knew that the funds were going into an offshore account but in many cases had never heard of Ansbacher or the Cayman Islands. Where clients have asked the Inspectors to state that they (the clients) may not have been aware of the location of their offshore funds, we have inserted such a comment in the text of the findings about them. It is also clear that College Trustee depositors in Guernsey did not realise that during a period of years in the 1980s their funds had been channelled through Ansbacher. 22.8 The various categories of clients The Inspectors have identified various categories of client of Ansbacher each of which are considered separately in this chapter of the report. The following are the categories: 22.9 Persons who beneficially owned funds in Ansbacher (Category A). This category includes persons who established trusts, and persons who deposited money in a simple account. The persons who established trusts tended to be the larger clients. In these cases, the trust would have a name which would not immediately identify the beneficial owner of the funds. It also would have one or more companies, which would be used by the trust as a vehicle for the investments controlled. The names of these entities (usually Cayman companies) have not been included in the list of clients. The list is confined to the principals involved rather than the corporate vehicles used, except in a limited number of cases where the principals were not known. The inclusion of these corporate entities would expand the list of clients to a number in excess of 300, but would add nothing to the information contained in the Inspectors’ more restricted list. 22.10 Persons who were clients of Ansbacher through College Trustees (Category B). In 1974, Guinness and Mahon had a number of old trusts in Dublin, which wished to move residence offshore at that time in order to avoid Capital Gains Tax. There were also in the region of thirty trusts established in the Channel Islands which did not have any effective system of administration, the company which was to have administered them, Guinness Mahon Channel Islands Limited (‘GMCI’), having relinquished its banking licence due to a review on cost grounds. A small number of old high asset Dublin trusts related to the Guinness Family. Through a mutual acquaintance, Guinness and Mahon came in contact with Mr John Lipscombe of Sovereign Management Ltd, Guernsey (‘Sovereign’). As a result of this acquaintance, a subsidiary of GMCI, called College Trustees Ltd. (‘College’) was established. This company rented space from Sovereign, and contracted Sovereign to supply management services for the Trusts. College then became Trustee of all the old Dublin trusts, of which there was something in the region of six to ten. Around 1976, Mr Traynor decided to change the accounting system in Guinness and Mahon insofar as it related to the Channel Island subsidiaries. Up to that time, individual deposits with the Channel Islands had appeared on the books of Guinness and Mahon in their owners’ names. These accounts were now coded, and appeared as ‘Guinness Mahon Channel Islands ‘A ’, or ‘B ’ ‘, etc. In 1978, the so-called ‘bureau system’ was introduced into Guinness and Mahon in respect of its Cayman and Channel Islands accounts. The individual deposits were amalgamated into pooled accounts, so that there was one pooled account in the name of the Cayman operation, and one in that of the Channel Islands. The underlying individual deposits were maintained in coded accounts on computer, but did not appear on the books of Guinness and Mahon. Around 1978 or 1979, Mr Lipscombe began to deal directly with the Irish clients of College. There were about 50 clients at that time, and very few new clients appeared after the end of the 1970s. The Channel Islands pooled account in Guinness and Mahon was for a time in the name of Guinness Mahon Guernsey. In 1981, the name of the account was changed, apparently for administrative reasons, to ‘Guinness Mahon Cayman Trust re College Trustees’. Thus, the flow of funds from companies underlying Channel Island trusts was from then on routed through Cayman to Guinness and Mahon. Many of College’s Irish clients were unaware of this. The result, however, was that persons who had formerly been clients of College and of Guinness Mahon Guernsey, then became clients of College and of Ansbacher. If a College client in Ireland wished to withdraw funds, Mr. Lipscombe would instruct Guinness and Mahon to that effect. The client would call to Mr Martin Keane of Guinness and Mahon and he would give him cash or a cheque for the desired amount. Mr Keane would enter this transaction in a suspense account, and Mr Traynor, who would know the relevant coded sub-account to be debited, would deal it with subsequently. From 1981 to 1989, all such withdrawals were debited to the Guinness Mahon Cayman Trust re College Trustees account. The Inspectors note that clients of College who became clients of Ansbacher in the way described above, may have been unaware of that fact. 22.11 Persons who were clients of Ansbacher through Mr Jack Stakelum (Category C). This category contains persons whose offshore funds were managed by Mr Stakelum and placed in Ansbacher through Mr Traynor, in the manner described in Chapter 20. The Inspectors note that clients of Mr Stakelum who were also Ansbacher clients may have been unaware of the location of their offshore funds. 22.12 Persons whose sole involvement was the establishment of Ansbacher trusts to which they never transferred any assets (Category D). The persons listed in this category arranged for the establishment of Ansbacher trusts. They have informed the Inspectors that no assets were ever transferred to these trusts. 22.13 Persons for whom Ansbacher conducted business other than the holding of funds (Category E). This category contains three classes of person: (i) Persons to whom Ansbacher provided loans in the ordinary course of business; (ii) Persons provided with an Ansbacher company for the purpose of purchasing property; (iii) Persons who owned Ansbacher-managed companies which were potential beneficiaries of the Lynbrette Trust. The following chapter contains the list of those identified as clients of Ansbacher in each of the above categories. INDEX Page 23.1 Introduction 281 23.2 Category A: List of persons who beneficially owned funds in Ansbacher 281 23.3 Description of Category A clients 286 23.4 Category B: List of persons who were clients of Ansbacher through College Trustees 399 23.5 Description of Category B clients 399 23.6 Category C: List of persons who were clients of Ansbacher through Mr Jack Stakelum 414 23.7 Description of Category C clients 414 23.8 Category D: List of persons whose sole involvement was the establishment 23.9 of Ansbacher trusts to which they never transferred any assets 419 Description of Category D 419 23.10 Category E: List of persons for whom Ansbacher conducted business other than the holding of funds 422 Page 23.11 Category E(i): List of persons to whom Ansbacher provided loans in the ordinary course of business 423 23.12 Description of Category E(i) clients 423 23.13 Category E(ii): List of persons provided with an Ansbacher company for the purpose of purchasing property 23.14 Description of Category E(ii) clients 428 428 23.15 Category E(iii): List of persons who owned Ansbacher-managed companies which were potential beneficiaries of the Lynbrette Trust 23.16 Description of Category E(iii) clients 429 429 23.1 Introduction This Chapter contains a list of all of the clients of Ansbacher identified by the Inspectors, which are presented under the category headings outlined in the previous chapter. Each category list is followed by a series of short narratives about each of the relevant clients. These narratives identify the individual client and describe their Ansbacher connection. The evidence supporting the conclusions about each client is appended to the Report, where any relevant submissions made by or on behalf of each client can also be found. The Appendix reference number is noted after each narrative. 23.2 Category A: List of persons who beneficially owned funds in Ansbacher 1. Mr Roger P Ballagh 2. Mrs Frances Elizabeth Barrett 3. Mr John Barrett - deceased 4. Mr Jesus Barrios and Mrs Maria Barrios 5. Mr Anthony Barry 6. Sir John Derek Birkin 7. Captain RG Bryce 8. Mr John Byrne 9. Mr Patrick Carty and Mrs Beatrice Carty 10. Mr DHA Cecil - deceased 11. Mr Ronald Chambers 12. Mr Samuel Clarke - deceased 13. Mr Henry J Cleeve 14. Mr PJ Clonan 15. Mr Kevin Collery and Mrs Kathleen Collery 16. Mr Padraig Collery 17. Mr Cornelius Collins 18. Mr Patrick Finbarr Collins 19. Lady Carole Conyngham 20. Mr Hugh Coveney - deceased 21. Mr George Crampton 22. Captain W R Cuffe-Smith - deceased 23. Mr James P Culliton 24. Dr Michael Dargan 25. Mr Brian Dennis 26. Mr Charles TG Dillon - deceased 27. Mr Terence DE Dixon 28. Mr David Doyle 29. Mr P Vincent Doyle - deceased 30. Mrs Helen Downes 31. Mr James Durkin 32. Mr James Sidney East - deceased 33. Mr Francis Augustine Eastwood - deceased 34. Mr Stephen Enoch 35. Mr Victor Enoch 36. Mr Bernard Etzin 37. Mr Sam Field-Corbett 38. Mr John Finnegan 39. Mr Desmond G Fitzgerald - deceased 40. Mrs Eileen M Fitzgerald 41. Mr Raymond C Fitzgerald 42. Ms Marjorie Sue Fitzgibbon 43. Mr Denis Foley 44. Fruit Importers of Ireland Limited 45. Mr Arthur Gibney 46. Mr Francis P Glennon - deceased 47. Mr Paul Goode 48. Mr Christopher Goosen 49. Ms Clare Griffin 50. Mr James Griffin Junior 51. Mrs Jennifer Guinness 52. Mr John Guinness - deceased 53. Mr Frank Hall 54. Mr Charles J Haughey 55. Mr Gerald Hickey - deceased 56. Mr Jorge Hine and Mrs Margo Hine 57. Mr Denis A Jackson 58. Mr Thomas Jackson 59. Jamila Pty Limited 60. Mr William Kearney - deceased 61. Mr John Kennedy 62. Dr Colm Killeen 63. Mr Richard Lawes 64. Mr Frank Lee 65. Mr Michael Leyden and Mrs Dorothy Leyden 66. Mr James Henry Lindsay 67. Mr Joseph Clayton Love Junior 68. Mr Bryan Lynam 69. Mr Edward Lynam 70. Ms Eileen Lynam 71. Mr James Lynam - deceased 72. Ms Mary Lynam 73. Mrs Hedli MacNeice - deceased 74. Ms Mary Meagher McCarroll 75. Mr Patrick McCarroll - deceased 76. Mr Liam McGonagle - deceased 77. Mr Sean McKeon 78. Mr Thomas J McLaughlin - deceased 79. Mr Patrick McNamee 80. Ms Susan Sheridan Mack 81. Ms Mary Maher (nee Lynam) 82. Sir George Mahon - deceased 83. Mr Alexander H Maj or 84. Mr Augustina Russek de Malamud 85. Mr Carlos David Malamud 86. Mr German Malamud 87. Mr Isaac Carlos Malamud 88. Mr Joseph Malone 89. Mr Ronald Markham and Ms Jean Peterson 90. Mr John A Masek 91. Mr Basil Mawdsley 92. Professor Anthony J Merrett 93. Mr Geoffrey Miller 94. Mr Jerome Morris 95. Mr Joseph Morris 96. Mr Martin Morris - deceased 97. Mr Stephen Morris 98. Mr Thomas Morris 99. Mr John Mulhern 100. Mr James Murray 101. Mr William Navan Senior - deceased 102. Mr Maurice Neligan and Dr Patricia Neligan 103. Mr Olivier Nicol 104. Mr Michael J O’Keeffe - deceased 105. Mr Maurice O’Kelly 106. O’Reilly Aerlod (Ireland) Limited 107. Mr Dermot O’Reilly-Hyland - deceased 108. Mr Ken O’Reilly-Hyland 109. Mr Michael O’Shea 110. Mr John Oppermann and Mrs Eileen Oppermann 111. Pettit International Limited 112. Dr Michael Phelan 113. Ms Marily Power 114. Mr Fernando Pruna and Mrs Eudelia Pruna 115. Mr Seamus Purcell 116. Mr Diarmuid Quirke - deceased 117. Mr Jeremy Robson 118. Mrs Sonia Rogers 119. Captain Tim Rogers - deceased 120. Mr John Savoy 121. Schwartz Management Company 122. Mr Joseph Seeley 123. Mr Sidney Seymour - deceased 124. Mrs Nora Shanahan 125. Mr Michael Shanley 126. Mr John D Sheridan - deceased 127. Mr Jack Stakelum 128. Mr Sam Stephenson 129. Super Ser Limited 130. Mr and Mrs Peter Tamburo 131. Mr Kazuaki Tazaki 132. Ms Carmel Traynor 133. Mr James Desmond Traynor 134. Mr Joseph Turley 135. Mr Martin Turley 136. Sir Charles Villiers - deceased 137. Dr Oliver Waldron 138. Mr Joseph Walsh 139. Mr Ivan Webb - deceased 140. Ms Joan Williams 141. M r R obert W illis 142. M r R obert W ilson 143. W ilson B ishop Tolley and Co Pty 144. M r A dolf Franz (Burschi) W ojnar - deceased 145. M r R ichard W ood 146. M r Christopher W oodw ard 147. M r R onald W arren W oss 23.3 Description of Category A clients 1. Mr Roger P Ballagh M r M ichael O ’Shea, M r R oger P B allagh and M r Terence D E D ixon are solicitors in a Dublin firm. D uring 1992, fees earned by the firm w ere given by M r M cG onagle, their late partner, to M r D esm ond Traynor and ended up in an A nsbacher account. The rem aining partners have assured the Inspectors that they did not know w here these funds w ere lodged. The sum involved was £40,000 approxim ately. The m oney was left on deposit offshore for som e tim e and then shared out am ong the partners. w ere m ade from a H am ilton R oss account in Ansbacher. The payments The IIB dealing tickets show that M r B allagh received over IR £ 1 1,530, M r O ’Shea and M r D ixon IR£6,243 each, the firm IR £4,877 and a com pany controlled by the late M r Liam M cG onagle Stg £6701. All the partners who shared m that fund w ere thus clients o f A nsbacher. (The Inspectors’ form al decision on the late M r M cG onagle is to be found elsew here in the report.) M r M ichael J O ’Shea, M r R oger Ballagh and M r Terence D ixon w ere clients o f A nsbacher, although the Inspectors accept that they w ere not aw are o f the location o f the funds. A ppendix X V (1) refers. 2. Mrs Frances Elizabeth Barrett M rs Frances Elizabeth B arrett resides at The Laurels, C lifford Cham bers, Stratford-uponAvon, W arw ickshire, England. She replied to the Inspectors’ w ritten request for inform ation by letter dated 2 July 2000, saying that she had no know ledge o f the m atters the subject o f their enquiries. W ithout the benefit o f M rs B arrett’s assistance, the Inspectors have been obliged to base their conclusions on docum entary evidence in their possession. Inform ation provided by M r Padraig Collery shows that M rs B arrett was the beneficiary o f an A nsbacher trust called the A lderw ood Trust, and that her A nsbacher account code was A /A 32. From other docum ents, it em erges that M rs B arrett received paym ents in London by direction o f M r D esm ond Traynor w riting on A nsbacher headed paper, and these paym ents w ere debited to an account in the name, initially, o f Colinas Investm ents Lim ited, and later o f Coral R eef Securities, both in Guinness and M ahon. Docum ents relating to Coral R e e f s account in Guinness M ahon & Co. show that M rs B arrett was an authorized signatory on the account. Letters from M r Padraig Collery to M rs B arrett from an address at W inetavern Street, D ublin, betw een 1995 and 1997, refer to a deposit that had m atured and explain that part o f the total sum has been replaced on deposit and that the balance, after deduction o f fees, is being credited to the Coral R e e f account in London. The W inetavern Street address was the address from w hich M r C ollery conducted A nsbacher’s business after the death o f M r Traynor in 1994. A ppendix X V (2) refers. 3. Mr John Barrett Deceased The late M r John B arrett, form erly o f 34 M onckton Court, A ddison Road, London W 14 8FN, was a long tim e G uinness and M ahon client. At all tim es he appears to have dealt w ith M r D esm ond Traynor in relation to his Guinness and M ahon business. D uring the 1970s M r B arrett had dealings with M r Traynor that show an A nsbacher connection. His involvem ent was contem poraneous w ith a transaction betw een Guinness and M ahon/A nsbacher and a M rs Frances B arrett about w hom the Inspectors have m ade a separate finding. A ppendix X V (3) refers. 4. Mr Jesus Barrios and Mrs Maria Barrios M r Jesus Barrios and M rs M aria Barrios form erly o f 943 S.W. 78 Place, Florida 33144 U S A w ere associates o f M r and M rs A ndreas Pruna. Like the Prunas the Barrioses w ere under investigation for drug related offences in the State o f Florida. Evidence on this was given to the M oriarty Tribunal by M s Sandra K ells on beh alf o f Guinness and M ahon. The correctness o f her evidence at that Tribunal has been confirm ed to the Inspectors by Guinness and M ahon. The B arrioses borrow ed $75,000.00 from Guinness and M ahon in 1984. The loan was secured by a m ortgage on property in Florida and a G M CT deposit in Dublin. Interest was paid on the borrow ing by the borrow ers during the lifetim e o f the loan. At all tim es the loan was considered a ‘suitably secured’ loan in the books o f Guinness and M ahon. The artificial nature o f the transaction is clear from the w ay in w hich the loan was operated. Interest on the loan was varied from tim e to tim e w ithout any com m ercial connection w ith the m arket interest rate at the tim e. For exam ple an exchange o f telexes betw een G M C T and G uinness and M ahon dated 18th and 19th D ecem ber 1985 m akes clear that the interest charged in 1984 at the negotiation o f the loan was up to 8% higher than the then m arket rate. It appears that artificial rates w ere put in place w ith only the differential betw een the deposit rate and the loan rate representing the true position. In D ecem ber 1985, in an attem pt to regularise the position, the loan rate was cut from 18% to 10% w ith a corresponding adjustm ent in the deposit rate. A t all m aterial tim es A nsbacher held the backing deposit in its account in Guinness and M ahon in Ireland and/or in the Caym an Islands. A ppendix XV (4) refers. 5. Mr Anthony Barry M r A nthony D erm ot B arry was form erly Chairm an o f C R H pic ( ‘C R H ’). M r B arry told the Inspectors in his evidence on oath that in about 1989, he w ished to m ake financial arrangem ents for tw o o f his children, w ho w ere non-resident. A t that tim e, M r D esm ond Traynor was Chairm an o f C R H and M r B arry was in regular contact w ith him. M r Traynor had left G uinness and M ahon at the tim e, but M r Barry was aw are that he retained a connection w ith an offshore subsidiary o f Guinness and M ahon . M r Barry m entioned to M r Traynor his desire to provide for his children, and to utilise certain funds representing foreign dividend incom e and/or paym ents in reim bursem ents o f business expenses for this purpose. H e told the Inspectors that this incom e had been properly declared to the Revenue. M r Traynor suggested that M r B arry should give him the cheques, telling him w hen he w anted to transfer m oney to his children and that he w ould arrange it. M r B arry accepted the suggestion, and gave cheques to M r Traynor from tim e to tim e, usually sending them through C R H internal mail. It is clear from M r B arry’s evidence and from docum entation in the possession o f the Inspectors and show n to M r B arry that M r Traynor deposited M r B arry’s funds with Ansbacher. Transfers to M r B arry’s children from tim e to tim e w ere debited to A nsbacher’s account in IIB. M r Padraig Collery has inform ed the Inspectors that M r B arry’s A nsbacher account bore the code A/A22. M r B arry was a client o f Ansbacher, as was confirm ed by him in his evidence to the Inspectors, only to the extent indicated in the above paragraphs. A ppendix X V (5) refers. 6. Sir John Derek Birkin Sir John D erek B irkin is now retired but was a leading industrialist in the U nited Kingdom . Sir D erek was interview ed in London on 20 February, 2001. H e explained that he had a business arrangem ent w ith M r D esm ond Traynor, then chief executive of Guinness and M ahon, under w hich he placed m oney offshore. Sir D erek was not aw are o f the actual m echanism used by M r Traynor to care for the funds but he now accepts that A nsbacher was used for the purpose. A t a later date the m oney was transferred to H am ilton Ross. A ppendix X V (6) refers. 7. Captain R G Bryce C aptain R G Bryce is a resident o f How th, Co Dublin. From 1974 to 1977, he lived in Bangkok, Thailand. M r John G uinness o f G uinness and M ahon offered to set up an account in G M C T for Captain Bryce, so that he could leave his savings offshore until his return to Ireland. Captain Bryce says that to the best o f his recollection, the m onies in his account w ere repatriated during the tax year follow ing his return to Ireland. A letter dated 16 D ecem ber 1975 from M r John Furze o f A nsbacher to C aptain Bryce thanks him for his recent deposit o f funds, and notes that he m ay w ish to transfer further funds from tim e to tim e from his account in France. A ppendix XV (7) refers. 8. Mr John Byrne, Tristan Securities Limited and Prospect Holdings M r John Byrne is a w ell-know n property developer. H e has extensive property interests in Ireland and the U nited Kingdom . On the 9 August 1971, Mr Byrne put in place two structures each headed by a trust namely the Tristan Settlement and the Prospect Settlement. The Tristan Settlement This related to Mr Byrne’s UK business. The beneficiaries were to be identified by reference to a nominal payment to the British Red Cross. The settlor was Mr John Furze. The Tristan Settlement had a structure that included a Cayman company, Tristan Securities Limited (TSL). This company had two subsidiaries, Danstar Holdings Pty (an Australian company) and Intramar Securities, a Cayman company. Danstar had an UK subsidiary, Tepbrook Properties Limited. The Inspectors accepted the evidence supplied by Mr Byrne on the structure of this group (see exhibit 2 of transcript of evidence. The Inspectors, however, looked at the element of control as relevant to their work. They are satisfied that the legal ownership of the group vested in the trust but that control remained with Mr Byrne. The Prospect Settlement This related to Mr Byrne’s Irish business. The settlor was Mr Byrne. The beneficiaries were the wife and family of the settlor. An unlimited Cayman company, Prospect Holdings, which in turn owned Carlisle Trust Limited, an Irish company, held the assets on behalf of the trust. Carlisle had in turn a number of subsidiaries: Dublin City Estates Limited, Alstead Securities, Smithfield Property Development Limited (formerly Endcamp Limited), Goreville Limited, Pritco Limited and JEC properties. This is set out in Exhibit 2 ibid. These entities typically had various categories of shares, which vested ownership in the next highest corporate vehicle while retaining control in the hands of Mr Byrne. That Prospect Holdings was a client of Ansbacher is clear. The Inspectors considered whether it could be said that Mr John Byrne and Tristan Securities Ltd were also clients. Other evidence must be considered to arrive at any conclusion on these matters. General Findings on Structure In the case of both the Tristan and Prospect Settlements, Mr Byrne funded the establishment of the trusts and retained the right to change the trustees. The trustees appointed were the Company now under investigation. The trustees are unchanged to date. The two trust structures were established and remain separate. Notwithstanding this independence, the Tristan Settlement had provided back-to-back money to facilitate the borrowings of Irish companies with which it had no legal connection. The representation made on Mr Byrne’s behalf, as an explanation for this unusual arrangement, that money on deposit continues to earn interest while forming the basis of a back-to-back loan is noted and accepted. Interest earned, however, would arise in any event. To provide cash backing for the borrowings of a third party, for no reward, in a commercial situation, is a very strange use of trust money. The Inspectors are of the view that it shows a closer connection between these entities than represented by Mr Byrne Other Relevant Matters Mr Byrne personally guaranteed the borrowings of companies within the structure on many occasions. He was unable to explain, to the satisfaction of the Inspectors, why he should be called upon and/or agree to so do where he had no legal or beneficial interest in the trusts. Ansbacher made a STG£3,500 payment to Mr Byrne through Guinness and Mahon in April 1990. No explanation has been received as to this transaction. IIB advanced a loan in the sum of IR£212,000 in 1994 circa to Mrs Byrne (the wife of John Byrne), on behalf of Ballymadun Stud. This was cash backed by Hamilton Ross or Ansbacher. At that time, Hamilton Ross (which had in theory separated from its Ansbacher ‘parent’) continued to use Ansbacher’s Cayman address and telephone number. Its business continued to be a matter on which the Inspectors were required to report and its activities continued to be interwoven with Ansbacher’s Irish business. The loan was repaid in September of the same year. The funds were raised to refund Mr Byrne for advances to the stud over the years. The repayment of the loan is reflected in Ansbacher’s J6 account on 1 September 1994. The Inspectors have been informed by Mr Byrne that this account was relevant to Tristan Securities Ltd. The Ansbacher connection is confirmed by the IIB internal documentation attached hereto. Mr Byrne’s explanation is rejected as failing to disclose the full extent of the terms and conditions under which the money was advanced. The Inspectors conclude that Mr Byrne was the real beneficiary of this transaction. The Inspectors received a letter dated February 28 2001 from Mr Byrne’s solicitor, which was considered by the Inspectors prior to their decision. The Inspectors noted from documents supplied by Mr Byrne that Ansbacher, in contacting their clients recently in connection with the Cayman Island litigation concerning the disclosure of information, appears to include Mr Byrne as one of their clients who were entitled to object. The Inspectors considered all the matters dealt with at the interview, those items exhibited herewith and Mr Byrne’s explanations, written and oral, in arriving at their conclusions. The Inspectors note the matters set out herein above and further conclude: I The trusts as established could have provided a legitimate vehicle for the apparent objective of transferring ownership to a trust while retaining control with Mr Byrne. II The trusts as operated did not appear to the Inspectors to retain the legal separation necessary to achieve M r B yrne’s objective. m M any loans w ere provided to the com panies controlled by M r Byrne and m any of these had back-to-back security provided by the Tristan structure. These are described in the records o f Guinness and M ahon as ‘suitably secured’. Mr B yrne’s true relationship w ith the operating com panies is indicated by the personal guarantees given by him for these loans IV The funds held by the trusts in A nsbacher in Ireland w ere at all tim es available for any purpose to M r Byrne who (subject to his duty to retain sufficient deposits to service the back-to-back facility) had pow er to apply these funds as he thought fit. No evidence has been received by the Inspectors (relevant to any period prior to the public controversies in Ireland), w hich tends to contradict the Inspectors’ conclusions on control o f the funds by M r Byrne. V As the Caym an records o f the C om pany have been w ithheld from us, the Inspectors are unable to ascertain w ith certainty the extent to w hich other trust funds w ere available in Caym an, w hich never left a financial footprint in Ireland. M r Byrne assures the Inspectors that the com pany under investigation has refused him access to these records. It was open to M r Byrne to change the trustees but he has chosen to accept advice that it is futile to so do. The Inspectors conclude that control o f the trust funds rested w ith M r Byrne at all times. A ppendix XV (8) refers. 9. Mr Patrick Carty, deceased and Mrs Beatrice Carty, deceased M r Patrick Carty (deceased) and his w ife M rs B eatrice Carty (deceased), form erly o f 13, The Pines, Castleknock, D ublin 15 w ere retired businesspersons. Patrick and B eatrice Carty established a discretionary trust through Guinness and M ahon in their jo in t nam es in the Channel Islands around 1971. The m onies deposited in the trust w ere m oved to A nsbacher at som e stage prior to the w inding-up o f the trust in 1993, and appointm ents to beneficiaries cam e out o f an A nsbacher account in IIB, no. 02/01087/81. A ppendix X V (9) refers. 10. Mr DHA Cecil, deceased The late M r DH A Cecil, who died in N ovem ber 2000, was a resident o f the U nited Kingdom . H e ow ned a public house know n as the H are & H ounds in H ungerford, Berks. From docum ents in the Inspectors’ possession, it emerges that he obtained a loan for IR£179,616.85 in the 1970s from Guinness and M ahon, w hich w as backed by a guarantee from G M C T supported by hypothecated funds equal to the am ount o f the loan. Further docum entation gives rise to an inference that he was the beneficial ow ner o f funds in tw o other A nsbacher accounts, one in the nam e o f a Channel Islands com pany called G om brette Lim ited, w hich also had a G uinness and M ahon loan backed by funds in GM CT, and another w ith the reference ‘CD W oodw ard’, w hich had a sim ilar cashbacked loan. (M r Christopher D W oodw ard was a director o f G om brette Limited). M r C ecil’s accounts w ere coded ‘# 3 ’, ‘G ’ and ‘R /F ’ The loans appear to have been taken out for the purpose o f purchasing shares in Jam aica Sugar Estates Lim ited, and the shares w ere used as security for all three loans, in addition to the cash deposits. The G om brette loan was for IR£247,500 and the W oodw ard loan was for IR £123,000. Since all o f these w ere backed by cash, M r C ecil’s A nsbacher deposits am ounted to at least IR £550,116.85 in the m id-1970s. In correspondence betw een A nsbacher and G uinness and M ahon, the three loans are frequently m entioned together. A ppendix X V (10) refers. 11. Mr Ronald Chambers M r R onald Cham bers is a form er m anaging director o f R obert W ilson and Sons (Ireland) Limited. H e is now retired. M r Cham bers gave evidence that on the advice o f M r D esm ond Traynor, he established, in 1972, a discretionary trust o f w hich G M C T was trustee. The trust (know n as the A scot Trust) was for his ow n benefit, and for that o f his w ife and children. The trust funds w ere deposited w ith Ansbacher, where, according to statem ents given to M r Cham bers by M r Padraig Collery, they w ere kept in an account coded A/A66. M r Traynor told M r Cham bers that he could w ithdraw m oney from the trust funds w henever he wished, sim ply by asking M r Traynor, or, in his absence, M r Collery. M r Cham bers availed o f this service on a num ber o f occasions. Funds w ere transferred directly to his account in B arclay’s Bank, London. D ocum entary evidence in relation to w ithdraw als in 1990 shows that the am ount w ithdraw n was debited to the A nsbacher pooled account m G uinness and M ahon. A ppendix X V (12) refers. 12. Mr Samuel Clarke, deceased The late M r Sam uel Clarke was a director o f Cram pton H ousing Limited. In or about 1972, Guinness and M ahon was involved in a jo in t venture w ith Cram pton H ousing Lim ited for the developm ent o f a site in Dublin. M r G eorge C ram pton gave evidence on oath to the Inspectors to the effect that six trusts w ere to be established in connection w ith this developm ent, one for each o f the directors o f Cram pton H ousing Limited. H e said that his ow n trust was in fact established. O n the balance o f probabilities, this fact, together w ith the correspondence herew ith, indicates that the entire schem e was activated. The Inspectors are satisfied that the establishm ent o f a trust on behalf o f a person constituted the carrying out o f business for them by GM CT. D ocum entation in the Inspectors’ possession indicates that the trust to be attributed to M r Clarke w as to be called the W hitethorn B Trust. The Inspectors have been unable to trace the next-of-kin o f M r Clarke. A ppendix X V (13) refers. 13. Mr Henry J Cleeve M r H enry J C leeve resides at The O ld Rectory, Gowran, Co Kilkenny. M r C leeve inform ed the Inspectors that he set up the Springfield Trust w ith funds bequeathed to him by his aunt, a Canadian national, who died in 1979. 1980 Statem ents o f a G M C T sundry sub com pany account in G uinness and M ahon show transactions relating to M r Cleeve and to a com pany called ‘Springfield Investm ents’ w ith w hich his nam e is linked in a num ber o f statements. O ne such transaction, dated 15 A ugust 1980 and referenced ‘re Springfield’, shows a debit o f STG£8,000. It w ould appear from a letter dated 18 A ugust 1980, w ritten to Guinness and M ahon by D erek H olden & Co, Solicitors, that a sum o f STG £8,000 was sent to that firm by Guinness and M ahon on behalf o f M r Cleeve on 14 A ugust 1980 A ppendix XV (14) refers. 14. Mr Patrick J Clonan M r Patrick J C lonan was a shareholder in D eilginish H oldings Lim ited, a property developm ent company. D ocum ents in the possession o f the Inspectors show that M r Clonan received a paym ent and travellers cheques, both o f w hich were debited to an A nsbacher account in Guinness and M ahon. The Inspectors w rote to M r Clonan on 3 A pril 2001 seeking inform ation about these transactions. On 20 April 2001, M r Clonan replied, stating that he had never had any dealings w ith Ansbacher. H ow ever, he adm itted that he had placed m oney abroad through M r Jack Stakelum , but said that he had no know ledge o f w here those funds w ere placed. A ppendix X V (15) refers. 15. Mr Kevin Collery and Mrs Kathleen Collery M r K evin Collery (deceased) and M rs K athleen Collery are the parents o f M r Padraig Collery. M r D esm ond Traynor opened an A nsbacher bureau account at the request o f M r Padraig C ollery in M ay 1992. M r K evin C ollery’s funds from a m aturing investm ent held in Ireland w ere placed on deposit in an account num ber A /A3 OK. added further funds after his father’s death on 20 A pril 1995. M r Padraig Collery The account was routed through H am ilton Ross from about 1993 and was closed in July 1999. It w ould appear that neither M r Kevin C ollery nor M rs K athleen C ollery took any part in the operation o f the account. A ppendix X V (16) refers. 16. Mr Padraig Collery From 1974, M r Padraig Collery w orked with M r D esm ond Traynor in Guinness and M ahon as an accounting and com puter m anager, rising to becom e an A ssociate D irector in 1986. H e left Guinness and M ahon in 1989 and joined a com puter softw are supplier as a support m anager, but continued, on a part-tim e basis, to assist M r Traynor w ith the m aintenance o f the A nsbacher and C ollege Trustees com puterised accounting records, the so-called bureau system. A fter M r T raynor’s death in 1994, M r Collery was the principal A nsbacher authorised representative in Ireland. A n A nsbacher deposit account, num ber A/A30, was opened for him by M r Traynor into w hich fees, expenses and gratuities earned for his w ork on A nsbacher and College Trustees w ere transferred. A t the start o f January 1993, M r Traynor arranged that M r C ollery’s deposit account was transferred into the nam e o f H am ilton Ross. A ppendix X V (17) refers. 17. Mr Cornelius Collins Cornelius (Neil) J Collins is a businessm an who is currently M anaging D irector of H effernan’s Travel in Cork. H e has been involved in property developm ent both in Ireland and abroad. M r Collins told the Inspectors under oath that he had funds and assets in the U nited States, w hich had been given to him by an uncle in the States. M r Collins was advised by Stokes K ennedy Crowley, who w ere his financial advisers, that it w ould be m ore productive to invest those assets offshore than to bring them back to Ireland. On the advice o f Stokes K ennedy Crowley, his financial advisers, a trust called the Redhall Trust, o f w hich A nsbacher was trustee, was established in the Caym an Islands. A 1976 statem ent o f affairs o f R edhall Trust shows that the trust was the beneficial owner of shares in tw o companies: Redhall Investm ents L im ited (‘R edhall’) and A gar International L im ited (‘A gar’). M r N eil Collins said that Redhall held his funds, w hile A gar held those o f his brother. D ocum entation indicates that the Redhall funds w ere in an account coded A/X4 Tam arin H oldings L im ited ( ‘T am arin’), a com pany belonging to M r Collins, w as also linked w ith Ansbacher. D ocum entation indicates that T am arin had at least tw o coded accounts, A /X l and A/X5. Mr Collins, together with two partners, was involved in a property development venture in Dundalk in the early 1970s. He had replaced Mr Neil McCann in this venture. An undated letter from Mr McCann to Ansbacher refers to a Deed of Settlement dated 31 March 1972, by which John Andrew Furze appointed Ansbacher as Trustees of a settlement for the benefit of the issue of the late Charles McCann and Rosetta McCann. The letter states that in its capacity as Trustee of the said settlement, Ansbacher, through its nominees, owned the entire issued share capital of a company called Blue Limited. The letter goes on to authorize Ansbacher to transfer the entire issued share capital of Blue Limited to Neil Collins. The Inspectors note that when asked about this, Mr Collins said he had never heard of Blue Limited. However, a letter dated 5 January 1973 from Mr Alex Spain to Mr Vincent Walsh of Arthur Cox, and copied to Mr McCann and Mr Philip Monahan, refers to three Cayman trusts, called the Red, White and Blue trusts, which were established ‘early in 1972’, and directs that any profits arising from Earl House Limited and Earl House Investments Limited should flow into the trusts ‘through Jocal Investments.’ A Companies Office search reveals that Earl House Investments was a company of which Mr Collins was a director, and his employee, Mr Frank Lee, was secretary. The registered office of the company from 1975 to 1982 was Westboro, Montenotte, Cork, which was a business address of Mr Collins. Jocal Investments was the majority shareholder in Earl House Limited. Mr Collins was also involved in a consortium to carry out a development near Phoenix, Arizona, USA. Upon the advice of Mr Desmond Traynor of Guinness and Mahon, a scheme was constructed involving the establishment of a discretionary trust, (the Lynbrette Trust) of which GMCT was the Trustee. The Trust had as beneficiaries five Cayman companies, representing the interests of the five Irish participants. Mr Collins told the Inspectors that Spartacus Holdings Limited was the name of the company that represented his interest in the Trust. The development was unsuccessful and all participants lost their investments. 18. Dr Patrick Finbarr Collins D r Patrick Finbarr (‘B arrie’) Collins is a retired m edical practitioner, and form er non­ executive director o f W estboro Investm ents. In reply to the Inspectors request for inform ation, he stated that he had no connections w ith A nsbacher. In the course o f his evidence on oath to the Inspectors, Dr Collins said that an A m erican relative gave him som e shares, w hich he then gave to his brother, M r Cornelius ( ‘N eil’) Collins, to dispose o f for him. H e believed that M r N eil Collins invested the proceeds o f sale on his behalf. The said M r N eil Collins also gave evidence on oath to the Inspectors, in the course o f w hich he told them o f the establishm ent o f a trust called the Redhall Trust, o f w hich A nsbacher was trustee. A 1976 statem ent o f affairs o f Redhall Trust shows that the trust was the beneficial ow ner o f shares in tw o com panies: Redhall Investm ents Lim ited and Agar International Limited. M r N eil Collins said A gar International L im ited held funds belonging to his brother, D r B arrie Collins. The Inspectors accept that D r Collins left entirely to his brother M r N eil Collins the investm ent and m anagem ent o f the proceeds o f the sale o f D r C ollins’ shares. A ppendix X V (19) refers. 19. Lady Carole Conyngham (formerly Ms Carole Power Yorke) Lady Carole Conyngham (form erly M s C arole Pow er Yorke) resides at 42 Lygon Road, Edinburgh, Scotland. The Inspectors w rote to Lady Conyngham requesting inform ation on 11 M ay 2000. H er solicitors replied on 22 M ay 2000, explaining that she was ill. A m edical certificate w as furnished on 21 June, at w hich tim e her solicitors requested a further 6 weeks in w hich to respond to the Inspectors’ letter. The Inspectors acceded to the request, fixing a deadline o f 3 A ugust 2000. On 12 July 2000, Lady C onygham ’s husband telephoned the Inspectors’ solicitor to explain that his w ife w as abroad convalescing, and that it w ould not be possible to deal w ith the m atter by the 3 August. This was follow ed by a letter dated 13 July 2000 from Lady C onyngham ’s solicitor, saying that he fully expected to be able to provide the Inspectors w ith a statem ent by the end o f August. D espite tw o telephone rem inders from the Inspectors’ solicitor, (in Septem ber 2000 and 24 O ctober 2000), as well as a w ritten rem inder on 26 October 2000, the only response was a fax from Lady C onyngham ’s solicitor on 30 October 2000 saying that he had rem inded his client about the m atter and was aw aiting her instructions. In the circum stances, the Inspectors have been obliged to arrive at a prelim inary conclusion w ithout the benefit o f Lady C onyngham ’s evidence. Lady Conyngham had funds, stocks and shares on deposit w ith GM CT. These funds, stocks and shares were held in the nam e o f a com pany called Capoyo Limited. These were used as security for loans obtained by Lady Conyngham from G uinness and M ahon. A ppendix X V (20) refers. 20. Mr Hugh Coveney, deceased M r H ugh P Coveney, late o f Laharn, M inane Bridge, County Cork, was a m em ber o f Dail Eireann and a quantity surveyor by profession. The existence o f deposits w ith G M CT during the 1970s up to 13 D ecem ber 1979 belonging to the late M r Coveney was adm itted on behalf o f his E state both to the M oriarty Tribunal and to the Inspectors. It was confirm ed that docum ents bearing the reference ‘H C ’ related to the late M r Coveney. This was confirm ed by a Guinness and M ahon statem ent o f account entitled "Guinness Mahon Cayman Trust Ltd H C ’ in w hich a debit for 10 A pril 1979 reads ‘tsfr stg 2000 to M idland B ank re M r H ugh C oveney’ A m em orandum prepared for the M oriarty Tribunal by the late M r Coveney dealt w ith a US property venture. This docum ent disclosed that, in 1980, the late M r Coveney, together w ith three A m erican investors and four other Irish investors, form ed a consortium to develop a property in the US. The consortium caused a discretionary trust, the Lynbrette Trust, to be established, o f w hich trust G M CT was the trustee. The beneficiaries o f the Lynbrette Trust w ere intended to be five Caym an Island registered com panies. The late M r Coveney was to be given the option to acquire one o f these com panies, Eclipse H oldings L im ited ( ‘E clipse’). M r Coveney was required to invest $212,500 in the venture. Eclipse borrow ed the necessary funds from G M C T and the late M r Coveney guaranteed these borrow ings, in return for w hich he was to be given an option to acquire the shares o f Eclipse. The property developm ent in question was unsuccessful and failed financially and the late M r Coveney had his guarantee for eclipse called by GM CT. H e also had, w ith other Irish investors, guaranteed borrow ings o f the Lynbrette Trust from AIB. That guarantee was also called. The late M r Coveney suffered considerable losses on this venture. A ppendix X V (21) refers. 21. Mr George Crampton M r G eorge Cram pton is a form er chairm an and m anaging director o f the building company, G& T Cram pton. In or about 1972, Guinness and M ahon was involved in a jo in t venture w ith Cram pton H ousing L im ited for the developm ent o f a site in Dublin. The directors o f Cram ptons sought advice from M r D on R eid o f Stokes K ennedy Crow ley (now K PM G ) as to taxation aspects o f a proposal m ade by M r D esm ond Traynor to place the proceeds o f the jo in t venture in an offshore trust based in the Caym an Islands. M r Cram pton told the Inspectors that follow ing M r R e id ’s advice (given after taking legal opinion) he was satisfied that the schem e did not involve tax evasion. Consequently six trusts w ere established in connection w ith the developm ent, one for each o f the directors o f C ram pton H ousing Limited. M r C ram pton’s ow n trust (know n as the W hitethorn No. 6 Trust) was established in 1972, and the trustee was Ansbacher. The trust funds w ere held in the nam e o f a com pany called Starling Securities Limited. M r Cram pton understood that the m oney w ould be held in the Caym an Islands. A ppendix XV (22) refers. 22. Captain W.R. Cuffe-Smith, deceased The late Captain W R C uffe-Sm ith was an A er Lingus pilot. D ue to the illness o f his widow, and the inability o f any other m em ber o f his fam ily to be o f assistance, the Inspectors have been obliged to arrive at their prelim inary conclusions by reference to docum ents in their possession. An undated Letter o f W ishes headed ‘Guinness M ahon Caym an Trust L im ited’ refers to a discretionary trust and asks the Trustees to hold the trust fund prim arily for the benefit of Captain Cuffe-Sm ith, his w ife and fam ily, and requires the Trustees not to m ake any distributions from the fund w ithout asking the advice o f Captain Cuffe-Sm ith. Other docum entation indicates that Captain C uffe-Sm ith’s funds w ere in an account coded ‘B /L ’. Further docum entation shows that funds w ere transferred from tim e to tim e from accounts in A nsbacher’s nam e in Guinness and M ahon and IIB to an account in the nam e o f Captain C uffe-Sm ith in Guinness and M ahon. A ppendix X V (23) refers. 23. Mr James P Culliton M r Jam es C ulliton becam e chief executive o f C R H in 1974 and a m em ber o f its board of directors. A t that tim e, the late M r D esm ond Traynor was also a m em ber o f the board. M r Culliton resigned as chief executive in 1987 but rem ained as a non-executive director until 1994. M r C ulliton told the Inspectors that in 1979, M r Traynor offered to place m oney for him in a dem and account, telling him that the deposit w ould have a variable rate o f interest and that the interest w ould be paid gross. It was clear to M r C ulliton that the account was to be a secret one, and that it w ould be offshore, although he was under the im pression at the tim e that it w ould be located in the Channel Islands. H e lodged and w ithdrew m oney through M r Traynor. H e closed the account in 1987. M r C ulliton’s funds w ere deposited offshore. His business was transacted at all tim es through M r Traynor. Day to day control o f funds deposited by Irish residents in the Caym an Islands rested w ith M r Traynor. H e did not have day-to-day control o f funds deposited in the Channel Islands. The Inspectors are therefore satisfied that, on the balance of probabilities, the funds w ere in Caym an rather than in the Channel Islands, and that M r Culliton was, on the balance o f probabilities, a client o f Ansbacher. A ppendix X V (24) refers. 24. Dr Michael Dargan Dr M ichael D argan is a form er Chairm an o f C R H and o f Aer Lingus. H e was also a m em ber o f the B oard o f the B ank o f Ireland. D r Dargan, w ho adm its that his m em ory is unreliable, told the Inspectors in his evidence on oath that he has no recollection o f having any funds in Ansbacher. H ow ever, docum entary evidence indicates that a guarantee given by Guinness and M ahon for a loan obtained from a B russels bank by D r D argan in 1990 was backed by an A nsbacher deposit. There is also docum entary evidence o f a transfer o f funds from an A nsbacher account in IIB to accounts in D r D argan’s nam e in U lster Bank and B ank o f Ireland. A ppendix XV (25) refers. 25. Mr Brian Dennis M r B rian D ennis has been involved all his life in the m otor trade and related industries. H e is now partly retired. H e is or has been a director o f a num ber o f com panies, including H B D ennis M otors Lim ited, Phoenix Finance Trust, E xchange Finance Lim ited, D ennis Group H oldings and the Educational B uilding Society. H e was a long tim e friend and neighbour o f the late M r D esm ond Traynor. M r D ennis stated in evidence that in 1972, he had a discussion w ith M r D esm ond Traynor in w hich he told M r Traynor that he w ished to m ake provision for the m arriage o f his sons. M r Traynor suggested to him that the m ost tax-effective w ay to do so w ould be to create a discretionary trust in the C aym an Islands. M r D ennis then did so, and transferred funds to the trust by giving them to M r Traynor. M r Traynor inform ed him that G M C T w ould be the trustee. M r D ennis stated that at a date he cannot recall, M r Traynor inform ed him that the trust was being m oved to the C hannel Islands. It w ould appear from an internal G uinness and M ahon m em o dated 24 D ecem ber 1986 that in the C hannel Islands the trust was m anaged by C ollege Trustees, but that G M C T continued to hold the deposit. A ppendix X V (26) refers. 26. Mr Charles T G Dillon, deceased The late Charles T G D illon was a prom inent businessm an w ho had been a director and chairm an o f a num ber o f Irish com panies including Guinness and M ahon. H e had been appointed a director o f that com pany on 8 M ay 1990 and retired from the board on 30 June 1996. M r D illon had a relationship w ith Guinness and M ahon as far back as 1986 when, according to an internal Guinness and M ahon docum ent, he had a loan together w ith another person in the sum o f IR£13,716.36. This loan is recorded as backed by an A nsbacher deposit Later the deposit appears to have been transferred to an account in the nam e o f H am ilton R oss held in IIB. The code o f this account was A /A 57 (see letter 2 February 1993 herew ith). From this account there w ere m any transactions in the nam e o f M r Dillon. These funds, w hile in the nam e o f H am ilton Ross, w ere at all tim es in the control of A nsbacher, as H am ilton Ross at that stage was a vehicle o f convenience for Ansbacher. A ppendix X V (27) refers. 27. Mr Terence DE Dixon M r M ichael O ’Shea, M r R oger P Ballagh and M r Terence D E D ixon are solicitors in a D ublin firm. D uring 1992, fees earned by the firm w ere given by M r M cG onagle, their late partner, to M r D esm ond Traynor and ended up in an A nsbacher account. The rem aining partners have assured the Inspectors that they did not know w here these funds w ere lodged. The sum involved was IR£40,000 approxim ately. The m oney was left on deposit offshore for som e tim e and then shared out am ong the partners. H am ilton R oss account in Ansbacher. The paym ents w ere m ade from a The IIB dealing tickets show that M r Ballagh received over IR £ 1 1,530, M r O ’Shea and M r D ixon IR£6,243 each, the firm IR£4,877 and a com pany controlled by the late M r Liam M cG onagle Stg £6701. All the partners w ho shared in that fund w ere thus clients o f Ansbacher. The Inspectors’ form al decision on the late M r M cG onagle is to be found elsew here in the report. M r M ichael J O ’Shea, M r R oger Ballagh and M r Terence D ixon w ere clients o f A nsbacher, although the Inspectors accept that they w ere not aw are o f the location o f the funds. A ppendix X V (28) refers. 28. Mr David Doyle Mr David Doyle is the son of the late PV Doyle of the Doyle Hotel Group. Guinness and Mahon, acting through Mr Desmond Traynor with whom Mr David Doyle came into regular contact, set up an offshore deposit account with GMCT for Mr Doyle (the number of which has not been established) about 1983. Initially Mr Doyle believed the account was in London, but, around 1986, he learned from Mr Traynor that it was in Cayman. He ended his relationship with Ansbacher around 1991. Mr Doyle enjoyed the use of the funds on deposit by means of a service provided by Ansbacher whereby he was able to deposit and withdraw funds in Ireland. Appendix XV (29) refers. 29. Mr P Vincent Doyle, deceased The late Mr P Vincent Doyle was a building contractor who, in the early 1960s, diversified his business and created the Doyle Hotels Group. Mr Desmond Traynor was a long time advisor to Mr Doyle, and, after the latter’s death in 1988, Mr Traynor attended board meetings of Doyle Hotels Group, and became a director. The Inspectors are indebted to Mr George Carville and Mr William Corrigan who attended for interview. Mr Carville is a former Deputy Managing Director, Financial Director and Company Secretary of the Doyle Hotel Group. Mr Corrigan acted as solicitor for the Doyle family and the Group. In these roles they worked very closely with the late Mr Doyle. An unlimited company, Thornhill Incorporated, held the shares of PV Doyle Hotels and the other Doyle companies in Ireland. Shares in Thornhill Incorporated were initially vested in an Irish discretionary trust for the benefit of Mr Doyle and his wife but, around 1986, 45% of the shares were transferred to the five Doyle children. In the early 1980s, Mr Doyle arranged for the formation of a US corporation, IH Investments Inc, which held the shares in the Doyle hotels in the US. The ownership of IH Investments Inc was by way of Extern Travel Inc 30%, PV Doyle Hotels 34% and Charles Frederick, a nominee entity used on the advice of Mr Traynor which held 36%. Extern Travel Inc was set up by Mr Doyle in the US to attract bookings for his Irish hotels. Extern Travel Inc was owned as to 17% by the Doyle Group and 83% by the Doyle family members. Mr Doyle also arranged for setting up of two Liechtenstein establishments into which were paid commissions earned by Extern Travel Inc. Both of these Liechtenstein bodies in the mid 1980s transferred their entire funds to a further Liechtenstein body called TAW A, which was a foundation with similarities to a discretionary family trust. In the early 1980s, a loan of STG£lm was arranged by Mr Traynor for a UK company, PV Doyle Hotels Limited, from Guinness Mahon London. The loan was cash backed by an Ansbacher deposit reference PVD. The deposit funds had come from TAWA or one of the other Liechtenstein entities. From 1990 to 1993, after Mr Doyle’s death, Mr Traynor sent Ansbacher account statements on unheaded notepaper for account numbers A/A38 and A/A42 to Mr Carville who believes they were beneficially owned by Mr Doyle or the Group. Mr Carville believes that the A/A42 account contained the accumulation of interest on the Stg£lm deposit which secured the London loan described above. Over the years, Mr Doyle and his hotel group, which were described by Mr Carville as being viewed by Mr Doyle as ‘one and the same thing’, had on-going contact with Ansbacher. The Inspectors are satisfied that the offshore funds held in Ansbacher in the names of companies in the Doyles Hotels group was under the effective control of Mr Doyle. 30. Mrs Helen Downes Mrs Helen Downes was employed in Guinness and Mahon from the age of 19. She ceased permanent employment in 1977 but worked on a part-time basis on and off for many years thereafter. When she became entitled to a sum of money that was surplus to her needs, she invested the sum on the advice of Mr Desmond Traynor. Initially she was unaware that the sum was offshore. On one occasion she added to the sum, and withdrew cash from time to time but in general the account was not active. The money was eventually held in an Ansbacher account ref A/A45 and later transferred to Hamilton Ross. Appendix XV (31) refers. 31. Mr James Durkin Mr James Durkin of 2 Bernard Road, West Worthing, Sussex, England, is of Irish background and worked in the building trade for many years. Unfortunately Mr James Durkin is now in bad health and the Inspectors are indebted to his son for the information, which he supplied concerning his father. Mr James Durkin established a vehicle in the Cayman Islands by way of a trust (Beechurst Trust) to receive money offshore. The Inspectors are not aware of the identity of the beneficiaries of the trust At least part of the money deposited in the trust made its way to Ansbacher accounts in Guinness and Mahon and later IIB. The money was also held in the name of Hamilton Ross Co. Limited m IIB. The account numbers used included A/A8 A /A ll and A/A8. Later, the money was transferred to accounts outside the scope of this investigation. Mr James Durkin withdrew money lodged with Ansbacher through both Guinness and Mahon and IIB and used the funds as his own. 32. Mr James Sidney East, deceased The late Mr James Sidney East was a director of Crampton Housing Limited. In or about 1972, Guinness and Mahon was involved in a joint venture with Crampton Housing Limited for the development of a site in Dublin. Mr George Crampton gave evidence on oath to the Inspectors to the effect that six trusts were to be established in connection with this development, one for each of the directors of Crampton Housing Limited. He said that his own trust was in fact established. Documentation in the Inspectors’ possession indicates that the trust to be attributed to Mr East was to be called the Whitethorn C Trust. In the early 1970s, the late Mr East had a loan from Guinness and Mahon described by the bank as ‘suitably secured’. On 24 January 2001, the Inspectors wrote to Mr Robin Peilow, Mr East’s executor, requiring him to furnish them with specified information. Mr Peilow, in his reply dated 26 January 2001, informed the Inspectors that he was unaware of any connection between Mr East and Ansbacher, and that he had no documentation in his possession relating to the matter. In those circumstances, the Inspectors have formed their preliminary conclusions on the basis of documentary and other evidence in their possession. Appendix XV (33) refers. 33. Mr Francis Augustine Eastwood, deceased The late Mr Francis Augustine Eastwood was a resident of Belfast, where he was a major dealer in scrap metal. When he sold his scrap metal yard in or around 1986, he settled the proceeds in three trusts of which Ansbacher was trustee. The trusts were called the Dallas, Canton and Omaha trusts Documentation in the possession of the Inspectors shows payments to Mr Eastwood from Ansbacher accounts in IIB. 34. Mr Stephen Enoch Mr Stephen Enoch was a resident of Ireland until 1979. He then emigrated to the US having sold his business interests in this country. He remained in the US until 1990. He acquired citizenship of the US but on leaving that country in 1990 relinquished that citizenship. Since 1990 Mr Enoch has had a residence in Spain but denies being tax resident in Spain or in any country since 1990 Mr Enoch was interviewed on 17 January 2001. For a full understanding of the issues raised, the transcript of that interview should be read. Some of the salient points appear to be as follows: I. Mr Enoch readily admitted that he was the part owner of a partnership called Girard Investment, which invested in property and borrowed US$1,250,000 from Guinness and Mahon in 1982. Mr Enoch refused to inform the Inspectors of the names of the other partners. This borrowing was backed by an Ansbacher deposit. II. Mr Enoch and his wife borrowed US$400,000 and $900,000 from Guinness and Mahon in 1990 both backed with Ansbacher based deposits. III. Mr Enoch denied knowing anything about Fountain Developments notwithstanding his name appearing in relation to this entity in the books of Guinness and Mahon. IV. Mr Enoch denied any legal or beneficial interest in or knowledge of ownership of Tabmount Corporation (the operating arm of a Cayman trust called the Anne Enoch Trust) despite an internal Guinness and Mahon document, dealing with the extension of a loan, identifying Mr Enoch as a beneficiary. Appendix XV (35) refers. 35. Mr Victor Enoch Mr Victor Enoch is a former resident of Ireland who now resides in Spain. He is 84 years old and in ill health. By reason of his ill health it has not been possible for him to attend before the Inspectors for examination on matters within his knowledge relevant to the inquiry. Mr Victor Enoch’s non-attendance for examination before the Inspectors is reasonable in view of his age and state of health. The central entity which is relevant in assessing this matter, is a Cayman based trust called the Anne Enoch Trust. Mr Stephen Enoch gave evidence that the person with information on that trust could be his father Victor Enoch. The Inspectors have concluded from this and other available information that the Anne Enoch Trust was at all material times under the control of Mr Victor Enoch and other family members. The trust has operated at least partly through the Tabmount Corporation. The Tabmount Corporation is, according to a Guinness and Mahon internal memo, a US property company, the beneficial owners of which are Mr Victor Enoch, his son Mr Stephen Enoch and other family members. Guinness and Mahon provided two facilities to the Tabmount Corporation, one in the sum of US $3 million in 1986 and the second in a sum of US $1.55 million in 1988. These borrowings were at all relevant times backed by cash on deposit in the Cayman Islands. On the balance of probability, the Inspectors conclude that the backing funds were provided by the Anne Enoch Trust structure. This conclusion is supported by a letter dated the 15 April 1988 from John Collins to Desmond Traynor listing properties registered in the name of Tabmount as assets of the Anne Enoch Trust. In addition, there were many other transactions involving Mr Victor Enoch that had an Ansbacher connection. An example was Girard Investments, a partnership that included both Victor and Stephen Enoch. In 1982, a loan was granted to this partnership by Guinness and Mahon, which was backed by Ansbacher lodgements Martina Investments Ltd is another entity connected with Mr Victor Enoch, which negotiated a loan with Ansbacher involvement. A letter from Guinness and Mahon to IIB of 6 March 1995 makes clear the Ansbacher connection. Mr Michael Enoch, another son, during the course of an interview with the Inspectors on 5 April 2001 gave evidence, the import of which was that his father, Mr Victor Enoch, controlled Martina Investments Ltd. A fuller understanding of the Enoch family involvement can be gamed if the evidence of both Mr Stephen Enoch and Mr Michael Enoch is read in conjunction with the other evidence. This is important because of the lack of first hand evidence from Mr Victor Enoch. Appendix XV (36) refers. 36. Mr Bernard Etzin Mr Bernard Etzin is a US citizen residing at 130 Grosvenor Road, London SW1. In the 1970s he was the Managing Director of Brother Ireland Limited and its English counterpart, both of which were subsidiaries of the Japanese Multi-National Corporation, Brother Industries. The Inspectors required Mr Etzin to attend for interview by letter of 9 March 2001, but no response was received. It transpired that Mr Etzm had moved residence, but he confirmed subsequently that he had received the letter. Mr Etzin provided information during a telephone call with the Solicitor for the Inspectors on 23 May 2001 which, taken with other information available to them, suggested he had an Ansbacher deposit account. By letter of 1 October 2001, Mr Etzin was requested to confirm in writing the information he had given orally. Mr Etzin declined to do so. From time to time during the 1970s, Mr Etzin borrowed monies from Guinness and Mahon or guaranteed loans to other companies. As an example, Guinness and Mahon records indicate that in 1977 Mr Etzm guaranteed a loan to an English company, Concept Plastics. This loan was described as being ‘suitably secured’. In the absence of an opportunity to interview Mr Etzin, the Inspectors infer that the loan was secured on his GMCT / Ansbacher deposit. A further letter of 22 February 1978 from Guinness and Mahon to Mr Traynor listed a document held for him as ‘Closed brown envelope marked ‘Agreement re Overseas Nominees and Etzin” . Overseas Nominees Limited was a Cayman registered nominee company owned by Ansbacher, and used for its business. Appendix XV (37) refers. 37. Mr Sam Field-Corbett Mr Sam Field-Corbett of 22, Pine valley Avenue, Grange Road, Rathfarnham, Dublin was a close associate of the late Mr Desmond Traynor. In his evidence on oath to the Inspectors, Mr Field-Corbett said that a trust, known as the Auckland Trust, was established on his behalf by Mr Desmond Traynor in the Cayman Islands in the mid 1980s. Mr Field-Corbett transferred money to the trust, which lent it to a company called Aucklands Investments. The latter placed the money on deposit with GMCT. A list of names and codes furnished to the Inspectors by Mr Padraig Collery shows that the funds were held in several accounts coded A/C. Mr Field-Corbett said that he was entitled to lodge and withdraw money from his coded accounts, and that he availed of this facility. Mr Field-Corbett also said that he used the trust funds as security for a loan, which he and two other persons obtained from IIB. Appendix XV (38) refers. 38. Mr John Finnegan Mr John Finnegan is a partner in Finnegan Menton. He has been an estate agent from the mid 1950s. In his evidence on oath to the Inspectors, Mr Finnegan said that he established a trust in the Cayman Islands in 1972, upon the advice of Mr Desmond Traynor. GMCT was the trustee. A company called Palace Investments Limited held the trust assets. The funds settled upon the trust were Mr Finnegan’s share of the profits arising from certain property transactions in which he was involved together with Guinness and Mahon transactions. The funds were deposited by Palace Investments Limited with GMCT, where they were held in accounts coded ‘P ’. Mr Finnegan accessed his funds by means of ‘loans’ made by the trustees. He did not repay these ‘loans’. Whenever he needed funds, he informed Mr Traynor, who would arrange to give him a bank draft, or would transfer funds to bank accounts in Mr Finnegan’s name or in the name of his wife or daughter. The trust was moved from GMCT in the early 1990s. Appendix XV (39) refers. 39. Mr Desmond G Fitzgerald, deceased Mr Desmond G Fitzgerald is deceased. He resided at Grove End, 6 The Grove, Epsom, Surrey, England, where his wife Eileen M Fitzgerald still resides. A letter dated 10 April 1979 between Mr J D Traynor and Mr Fitzgerald made arrangements for the opening of a bank account in GMCT in the name of Mr Fitzgerald and his wife. Mrs Fitzgerald has confirmed through her daughter that her husband had dealings with ‘Guinness and Mahon in Cayman’. By letter dated 30 November 2001, Mrs Fitzgerald informed the Inspectors that she has no information on the details of their account. Appendix XV (40) refers. 40. Mrs Eileen M. Fitzgerald See entry for Mr Desmond G Fitzgerald. 41. Mr Raymond C Fitzgerald Mr Raymond C Fitzgerald with an address in 1987 at 2351 Keystone Boulevard, North Miami, Florida, US, is one of a number of persons who did business with Guinness and Mahon in Ireland, apparently as an associate of a family called Pruna, who are the subject of comment elsewhere in this report. There is no doubt that the two parties were closely connected as an extract from an insurance policy dated 1 April 1986 show Guinness and Mahon as the first mortgagees of the above property occupied by Mr Fitzgerald and the Prunas as second mortgagees. A statement from a Guinness and Mahon official to the Moriarty Tribunal informed that body that Mr Fitzgerald’s December 1986 loan from Guinness and Mahon was in substitution for a loan made to Mr and Mrs Pruna. The loan is described as ‘suitably secured’ in the records of Guinness and Mahon and is included in a list produced on 24 December 1986 of loans backed with Ansbacher deposits. Mr Fitzgerald had the benefit of security for an Irish loan backed by funds on deposit in Ansbacher. The interest on the backing deposit, by Guinness and Mahon instruction, was to be credited to an account in Cayman by reason of an instruction in a memorandum in which the only name mentioned is Mr Fitzgerald. In the absence of an alternative, or any, explanation the Inspectors conclude that on the balance of probability, Mr Fitzgerald had a beneficial interest in these funds. Appendix XV (41) refers. 42. Marjorie Sue Fitzgibbon Ms Marjorie Sue Fitzgibbon, 34 Courtney House, Appian Way, Dublin 4 is an American national who settled in Ireland prior to the following events. On 8 July 1971, (as settlor) she caused to be established in Grand Cayman a trust and appointed GMCT as the trustees of the trust fund. The trust fund was operated through a company established in the Cayman Islands called Terra Securities Limited. On 28 May 1973, the trust funds and all assets were transferred to a different trust known as the Jersey Settlement under the control of Royal Trust Company of Canada (C l.) Limited, 33 Hill Street, St Helier, Jersey. This change apparently arose at the request of GMCT. Appendix XV (42) refers. 43. Mr Denis Foley Mr Denis Foley was, until the recent General Election, a member of Dail Eireann. He was a director of Central Tourist Holdings, a company that owned the Old Central Hotel in Ballybunion, Co Kerry. Mr Foley told the Inspectors that, in 1979, he had a sum of money to invest and he brought it to the late Mr Desmond Traynor, who at that time was a director of Gumness and Mahon. The meeting took place on the Guinness and Mahon premises, and Mr Martin Keane of Guinness and Mahon was present. Mr Foley was told at this meeting that his money would be invested in a company called Klic Investments. In his evidence on oath, Mr Foley agreed that in the light of documents made available to him by the Moriarty Tribunal, his money would appear to have been on deposit in GMCT’s account coded A/A40 in Guinness and Mahon. The account name was subsequently altered to that of Hamilton Ross. In 1986, Mr Foley opened a resident deposit account in Guinness and Mahon in his own name. Some time later, following a serious illness, he added his daughter’s name to the account. In 1990, Mr Traynor advised him to transfer the funds in the Guinness and Mahon account into his ‘Klic Investments’ account in order to earn better interest. Mr Foley did so. Mr Foley now believes that this money was placed on deposit in Ansbacher in a new coded account, A/A49. Mr Foley told the Inspectors that he made three withdrawals from the account. The first two withdrawals were made by arrangement with Mr Traynor. The first was a Guinness and Mahon bank draft; the second was in cash. The third withdrawal took place after Mr Traynor’s death. Mr Foley contacted Mr Padraig Collery to arrange this. The two men met in Jury’s Hotel in Dublin, where Mr Collery handed over £50,000 in cash to Mr Foley. Appendix XV (43) refers. 44. Fruit Importers of Ireland Limited Fruit Importers of Ireland Limited (‘Fruit Importers’) was incorporated in 1968. Mr Neil McCann was a majority shareholder, holding about 60% of the shares. The rest of the shares were divided among a number of persons. In 1980, the company ceased trading, and its trade and assets were transferred to a new company, FII pic. In 1986, FIT pic purchased Fyffes, and subsequently took over the name. The company is now known as Fyffes pic. Mr McCann gave evidence on oath to the Inspectors, and also furnished them with a number of documents. It is clear from a telex dated 14 October 1977 from Mr John Furze of GMCT to Martin Keane of Guinness and Mahon that Fruit Importers had funds on deposit with GMCT. This telex authorises the withdrawal of the balance in a dollar account and the debiting of the amount to GMCT’s sundry sub-company account in Guinness and Mahon. Mr McCann stated that he did not remember Fruit Importers having funds in GMCT. He agreed however that such must have been the case. Up to 1974, Fruit Importers had a subsidiary called International Fruit Agents (‘IFA’), a company incorporated in the Cayman Islands, with an address ‘c/o GMCT’. In 1974 it was sold to another Cayman company, Montagu Insurance Limited. However, between 1976 and 1980, Fruit Importers was the beneficial owner of funds held in a number of accounts in Guinness and Mahon under the name of IFA. Mr McCann gave evidence that these funds represented understated profits of Fruit Importers. Part of the funds in these accounts was subsequently transferred to Fruit Importers, on whose books they appeared as profit; the remainder of the funds was used to pay suppliers and to make bonus payments to Fruit Importers personnel. In relation to this, the company has informed the Inspectors that full disclosure of all relevant facts has been made to the Revenue Commissioners. The Inspectors are of the view that although IFA was no longer a subsidiary of Fruit Importers during this period, it was nevertheless available to Fruit Importers as a nominee company or fund-holding company. The GMCT sundry sub­ company account in Guinness and Mahon shows a debit of £164.67 on 4 February 1975, with the reference ‘Intl. Fruit A gents'. The inference that arises from this is either that IFA was receiving a payment from funds in GMCT, or that it was still managed at that time by GMCT, and the sum in question represented management fees. The Inspectors have formed the view that, on the balance of probabilities, Fruit Importers’ Cayman deposits were held in the name of IFA. Appendix XV (44) refers. 45. Mr Arthur Gibney Mr Arthur Gibney is a well-known Dublin architect. He has been a property developer in consortia with others, which on a number of occasions included Mr Desmond Traynor. Starting in the early 1970s, Mr Traynor placed monies representing Mr Gibney’s share of property development profits on deposit with Ansbacher in Cayman. Mr Traynor suggested that it would be a good idea for Mr Gibney to have a family trust in Cayman. Mr Gibney, while accepting that the creation of a trust had been mentioned to him, did not accept that he had any knowledge of the actual setting up of a trust. The Ansbacher deposit was used to provide security for property development loans from Guinness and Mahon, and these loans were described as being ‘suitably secured’. In the mid-1970s’ property crash, Guinness and Mahon wished to see Mr Gibney reduce the level of his borrowings, and the Ansbacher trust deposit was used by Guinness and Mahon to offset liabilities arising from development losses. However, Mr Traynor told Mr Gibney, who had been under severe financial pressure, that he had put aside an amount as security for his future. This amount was in an Ansbacher / Hamilton Ross deposit account code A/A2, and the account remained in existence in 1999. Appendix XV (45) refers. 46. Mr Francis P Glennon, deceased Mr Francis P Glennon (deceased) was the principal of the firm Frank Glennon Ltd. The firm was engaged in the insurance business in Ireland. Mr Glennon retired from day to day operational control of the firm in 1984 approximately but remained the Chairman until his death in 1992. During his retirement, Mr Glennon resided in Spain. The Inspectors are satisfied that Mr Glennon was the owner of substantial deposits with Ansbacher after his retirement. A letter dated 7 January 1991 on Ansbacher notepaper with an address for reply at 42 Fitzwilliam Square, under the signature of Mr Desmond Traynor, is typical of the information available to the Inspectors. This letter seeks the supply of a sterling draft of £380,000.00 to Mr Glennon from a specific account. This indicates that, at that date, Mr Glennon was an Ansbacher client. Appendix XV (46) refers. 47. Mr Paul Goode Orbit Investments Ltd was a Cayman company with a registered address at the GMCT Cayman office. It was used at various times for a number of persons apparently involved in racehorse ownership and or training. One such person was Mr Paul Goode of Haras de Clarbec, 14130 Pont L ’Eveque, France. By internal memo dated 1 June 1978, it is recorded that the beneficial owner of the company is Mr Goode. The Cayman connection is evidenced by undated letter to Mr Goode from an Irish executive of Orbit Investments Ltd, using Ansbacher’s address in Grand Cayman (PO Box 887). Guinness and Mahon provided the day-to-day management of this company from Ireland. Appendix XV (47) refers. 48. Mr Christopher Goosen Mr Francis Christopher Goosen was co-founder, together with Mr Harry Lindsay, of Super Ser Limited, in which he had a 50% shareholding. He worked in Dublin until 1970, when he moved to England to run Super Ser’s UK subsidiaries, Super Ser (UK) Limited and Impact Heaters Limited. Documentary evidence in the possession of the Inspectors showed that Mr Goosen had made regular withdrawals from the Ansbacher accounts in Guinness and Mahon and Henry Ansbacher & Co, London, between 1990 and 1991. In total, these amounted to around STG£400,000. In his evidence on oath, Mr Goosen told the Inspectors that he had no personal connection with Ansbacher. When the withdrawals referred to above were put to him, he was unable to recall them, but thought they might be payments for the sale of his shares in Super Ser, which, he said, Guinness and Mahon had brokered for him. He said that he had sold the shares for £250,000 to an American company whose name he was unable to recall. He could not explain why the withdrawals had been debited to Ansbacher, but said he didn’t know what methods of internal accounting Guinness and Mahon might have had. When it was pointed out to him that the total amount of withdrawals was greater than £250,000, he said that he thought the proceeds had been invested. Pressed further on this point, he admitted that he knew they had, and that in fact he had made an arrangement with the late Mr Desmond Traynor whereby Mr Traynor would invest the proceeds of sale of the shares, and Mr Goosen could withdraw them as and when required. Following the interview, Mr Goosen submitted an unsworn statement to the Inspectors in which he said that the funds had been invested 7« an offshore company in the Cayman Islands which M r Traynor had set u p ’. Mr Goosen said he understood that this was a legitimate procedure, and that where appropriate, the Cayman company accounted for taxes. Appendix XV (48) refers. 49. Ms Clare Griffin Ms Clare Griffin was the partner of the late Mr Francis P Glennon, the former owner of an Irish insurance brokerage. After Mr Glennon retired from day to day control of the business, the couple lived in Spain. From at least the year 1990, regular sums were paid to Ms Griffin from an account held in Ansbacher through Guinness and Mahon. These funds were, on the balance of probability, under the control of Mr Glennon so that at that time Ms Griffin was not herself a client of Ansbacher. Mr Glennon died on 1 April 1992. He was the owner of the A/A24 memorandum accounts. These totalled STG£64,085 in December 1992. It is clear that this did not represent the total fund available to Ms Griffin on the death of Mr Glennon as, in May 1993, substantial funds were transferred to Ms Griffin through Ansbacher’s account in IIB. These were a payment of STG £110,123.60 to herself alone in Guernsey together with two sums of STG£50,000 to herself and her son jointly, one in Gibraltar and one in Spain. Substantial funds were available to Ms Griffin over and above her late partner’s known deposit and the benefit of such funds and interest thereon accrued to Ms Griffin. The Inspectors, in pursuance of their duty to identify the clients of Ansbacher, sought the assistance of Ms Griffin but have failed to contact her either at her last known Spanish address or through her partner’s former lawyer in Gibraltar. Appendix XV (49) refers. 50. Mr James Griffin Jnr Mr James Griffin Jnr with a former address at 9751, S.W. 99th Street, Miami, Florida, US became a customer of Guinness and Mahon in 1987. A loan was negotiated in the sum of US$75, 000.00 apparently secured by a second mortgage on his property. At all times, however, the borrowing was backed by a deposit in the name of Ansbacher in Gumness and Mahon which account was noted as ‘Re; James Griffin Jnr’. The existence of the backing deposit was omitted from the letter of offer. The loan is also described as being ‘suitably secured’. The borrowing was renewed from time to time for a number of years. Mr Griffin was written to c/o Moby Marine Corporation, a company that lists Mr Griffin as a director. No reply was received. Appendix XV (50) refers. 51. Mrs Jennifer Guinness Mrs Jennifer Guinness is the widow of the late Mr John Guinness, a former chairman of Guinness and Mahon and close friend of the late Mr Desmond Traynor. Mrs Guinness told the Inspectors that in 1988, shortly after her husband’s death, Mr Traynor told her that her husband had established a trust in the Cayman Islands for her benefit and that of their children. A copy of a Deed of Trust dated 15 January 1972 which also names the trustees as GMCT - confirms this. Mrs Guinness said that she had not known of the existence of the trust prior to her husband’s death. Mrs Guinness said that Mr Traynor told her that if she needed money, she should ask him for it. She availed of this facility from time to time. On some occasions, the money was transferred to a bank account in her name in England. Documentary evidence shows that these transfers were debited to the Ansbacher pooled account either in Guinness and Mahon or in IIB. On other occasions she collected travellers’ cheques from him at the offices of CRH in Fitzwilliam Square. Following a requirement made by the Inspectors, certain files relating to business conducted with Ansbacher were furnished by NCB Stockbrokers of Dublin. All of the files related to an entity called Aurum Nominees. NCB have explained to the Inspectors that Aurum Nominees was a nominee account used by NCB for its clients. However, each client had a different account number, and a separate individually identified bank account, held in Ulster Bank, College Green, Dublin. Among the Aurum Nominees files were a number of files relating to a client account entitled Aurum Nominees Account 333034. This account was opened in 1989 by amalgamating two portfolios formerly held in Guinness and Mahon in the name of Overseas Nominees Limited, an Ansbacher nominee company. All instructions on the account were given either by the late Mr Traynor, or by the late Mr John Furze, another director of Ansbacher. Likewise, all information, account analysis, statements, etc, were sent to Mr Furze or to Mr John Collins at Ansbacher. NCB opened an account in the name of Aurum Nominees 333034 in Ulster Bank. At regular intervals, NCB would send an IR£ cheque to Ulster Bank requesting a sterling draft for the equivalent amount. The amount was debited to the Aurum 333034 account in the bank. The sterling draft was made payable on each occasion to Ansbacher, sometimes by its earlier names, GMCT and Cayman International Bank and Trust Company Limited. In 1994, the account was closed, and, as is evident from documents relating to the closure provided by NCB to the Inspectors, Mrs Guinness was the beneficial owner. The Inspectors have examined a number of the sterling draft requests made by NCB at the request of Mr Traynor. They have also examined, in the light of this information, the documentary evidence concerning the transfer of funds and the payment of travellers’ cheques which are referred to at paragraph 3 above. From this examination, the following emerges: (a) On 4 December 1990, Mr Traynor asked IIB to make available STG£4,600 worth of traveller’s cheques in the name of Mrs Guinness, and to debit the sterling cost to an Ansbacher account. On 7 December 1990, Mr Traynor wrote to NCB, ref. Aurum Nominees a/c 333034, asking ‘ in connection with a request from the above C lient’ for a cheque in the sum of STG£4,600.81, payable to Ansbacher. On 10 December 1990, NCB wrote to Ulster Bank requesting the sterling draft, and asking the bank to debit the amount to Aurum Nominees account 08393100, which was the account number in Ulster Bank of Aurum Nominees 333034. (b) On 13 December 1991, Mr Traynor wrote to NCB re Aurum 333034 thanking them for sending him STG£15,000 ‘f o r the above Client On the same date, Mr Traynor wrote to IIB asking them to transfer STG£15,000 to Mrs Guinness’s account at an English bank. (c) On 1 February 1993, Mr Traynor wrote to NCB ref. Aurum 333034, saying that the ‘client has requested some fu n d s ’ and asking for a draft for STG£5,000 payable to Cayman International Bank and Trust Company Limited. On 8 February 1993, Mr Traynor wrote to IIB asking them to transfer STG£5,000 to an account in the name of Mrs Guinness in England, debiting the amount to a Hamilton Ross account in IIB. (Hamilton Ross accounts in IIB held money that had previously been held in Ansbacher accounts in the same bank.) (d) On 2 March 1993, Mr Traynor wrote to NCB re Aurum 333034 thanking them for a draft in the sum of STG£6,000. A letter of the same date from NCB makes it clear that the draft is payable to Cayman International Bank and Trust Company Limited. On 3 March 1993, Mr Traynor wrote to IIB asking them to transfer STG£6,000 to an account in Mrs Guinness name in England, debiting the amount to a Hamilton Ross account. The Inspectors are therefore satisfied of the following matters: Mrs Guinness held stocks and shares in a portfolio managed by Ansbacher. From time to time, funds that were the proceeds of the sale of shares in the portfolio were lodged to an account in Ulster Bank. Money from that account, of which Mrs Guinness was the beneficial owner, was converted from time to time to sterling drafts payable to Ansbacher. These transactions frequently coincided, both as to date and as to amount, with transfers made from Ansbacher accounts in IIB to Mrs Guinness, or travellers cheques issued to her and debited to Ansbacher’s account in IIB. The Inspectors are satisfied therefore that money being paid to Mrs Guinness from an Ansbacher account was funded by money coming from an account in the name of Aurum Nominees, of which she was the beneficial owner. Their view is reinforced by a letter from Mr Traynor to NCB on 20 January 1992, in which he explains ‘we have recently organised some travellers cheques fo r the above client, and in order to reimburse us fo r this I would be grateful if you could organise to let me have a U.S. Dollar d ra ft... payable to Ansbacher Limited. ’ Appendix XV (51) refers. 52. Mr John Guinness, deceased The late Mr John Guinness was a director and chairman of Guinness and Mahon, and a close friend of the late Mr Desmond Traynor. Mr Guinness’s widow, Mrs Jennifer Guinness, gave evidence on oath to the Inspectors. She said that in 1988, shortly after her husband’s death, Mr Traynor told her that her husband had established a trust in the Cayman Islands for her benefit and that of their children. A copy of a Deed of Trust dated 28 January 1972 - which also names the trustees as GMCT - confirms this. Appendix XV (52) refers. 53. Mr Frank Hall Mr Frank Hall appears to have been a resident of the United Kingdom, and appears to have been linked to Sentinel Vehicles Ltd of Woolmer Industrial Estate, Barden, Hampshire. In 1982, he wished to take part in a venture together with a Mr Pieter Totte, another UK resident. The method of his proposed participation was explained in a letter from Mr John Collins of GMCT to Mr Totte. Essentially, GMCT was to provide a bank guarantee to Midland Bank pic to cover borrowings by Mr Totte’s company, Sentinel Vehicles Limited. Mr Collins indicated that the guarantee would probably come from Guinness and Mahon. For the guarantee, GMCT was to receive twenty-five percent of the issued share capital of Sentinel Vehicles, which was to be issued in the name of Beech Realty Company Limited, a GMCT company of which Mr Hall was the beneficial owner. In January 1982, Mr John Collins of GMCT wrote to the late Mr Desmond Traynor to indicate that he might need a bank guarantee for £35,000 from Guinness and Mahon ‘to cover Frank H all’s latest investment’. On 4 June, a guarantee in that amount was furnished by Guinness and Mahon to Midland Bank pic. On 8 November 1982, a memo from Mr Collins to Mr Traynor stated under the heading ‘Frank Hall Beech What we would like to do now is that G&M pay the £35,000 to Midland fo r A/C Sentinel fo r release o f guarantee and remit a further £20,000 to the company's lawyers trust account fo r sentinel and receive back from Sentinel a Debenture fo r £75,000. We or Frank have already paid £20,000. We will forward to you cash as backing deposit £50,000 and you will treat previous £20,000 as remitted through you to obtain total backing deposit o f £75,000. Turn between loan and deposit we have told Frank will be From the above, the Inspectors infer that the GMCT funds backing the Sentinel Vehicles Limited Ltd loan in Guinness and Mahon were beneficially owned by Mr Hall. Appendix XV (53) refers. 54. Mr Charles J Haughey Mr Charles J Haughey is a former Taoiseach. At the same time as the Inspectors were conducting their inquiries into the Company, a Tribunal of Inquiry into payments to Mr Haughey and Mr Lowry was sitting (the Moriarty Tribunal). The Inspectors were aware from the terms of reference of that Inquiry and from public reports of its proceedings that many matters touching on Mr Haughey’s finances were the subject of that Inquiry. However, in the context of the Inspectors’ own terms of reference, as there is no evidence to suggest that Mr Haughey played any part in the management of the Ansbacher, the Inspectors limited their investigation of him to the extent only that he was a client of the Company. It had been the intention of the Inspectors to interview Mr Haughey at the conclusion of his evidence to the Tribunal of Inquiry, headed by Mr Justice Michael Moriarty. Prior to that evidence concluding, Mr Haughey’s health deteriorated to such an extent that the concluding tranche of his evidence to the Moriarty Tribunal was conducted in private on commission. This evidence was subsequently read into the public record and forms part of the evidence before the Tribunal. On a requirement from the Inspectors for assistance, Mr Haughey forwarded a medical report from his medical advisors. This was considered by the Inspectors, who formed the view that the potential benefit to their Inquiry of the compulsory attendance of a person who had a marginal involvement in the general Ansbacher scheme, (in so far as it related to the company’s alleged wrongs), was not of such importance as to warrant the use by the Inspectors of their powers of requirement. This conclusion was assisted by the acceptance by Mr Haughey that evidence given by him at the Tribunal of Inquiry, then under way, could be availed of by the Inspectors in assessing whether Mr Haughey was a client of Ansbacher. Mr Haughey has agreed in evidence to the Moriarty Tribunal, (day 88 Q.133 to 136), that he and his wife jointly sought the permission of the Central Bank for a foreign currency loan, in the sum of the sterling equivalent of IRL£400,000. A letter addressed to the Manager, Exchange Control, Central Bank of Ireland dated 8 December 1982, was read into the record as follows: ‘D ear Sir I wish to make application on behalf o f Abbeyville Stud fo r permission to borrow Sterling. The details are as follows: 1. The bank: Guinness Mahon Cayman Trust Ltd, PO box 887, Grand Cayman British West Indies. 2. The amount: The sterling equivalent o f 400,000 Irish. 3. The purpose: Primarily development and commercial development o f the stud. 4. Drawdown in amounts o f 100,000 between 1st January 1983 and 31st January 1983. 5. Repayment: Full amount on the 31st January 1985. 6. Interest: Interest payable half-yearly will be at 1% over the cost o f the three- month funds. 7. Security: Joint and several guarantees o f C J Haughey and Maureen Haughey. The title deeds o f stud will be deposited with Mars nominees Limited, 17 College Green, on behalf o f Guinness Mahon Cayman Trust Limited and an undertaking given to formalise the security should this be required. la m enclosing an extra copy o f this letter fo r your convenience. Yours faithfully, Charles J Haughey. ’ The sum was apparently borrowed as STG£350,000 as two years later in January 1985 a letter was sent to Mr Haughey at his home from GMCT as follows; ‘D ear Sir Re loan extension -2 years- Sterling£350,000. We refer to our recent telephone discussion in connection with the extension o f the present facility. We confirm that we are willing to extend 350,000 sterling on the following terms and conditions. Interest: Payable quarterly at cost o f 1% over 90 day funds. Security: We will continue to retain the jo in t and several guarantee o f Charles J Haughey and Maureen Haughey. The guarantees will continue to be supported by the title deeds presently held. We should be grateful i f you would: 1. Have a copy o f this facility letter signed by both yourself and your wife. 2. Arrange fo r the Central Bank o f Ireland approval to be stamped on the copy o f this letter. Having had the above documentation completed, we would be grateful i f you would hand them to Des Traynor fo r onward transmission to us. Yours faithfully John A Furze. ’ Mr Haughey confirmed to the Moriarty Tribunal the above facts, and the validity of his own and his wife’s signatures, written on the above document (day 88 Q. 158 and reply). No evidence has been adduced as to whether this loan was repaid. This appears to have been accepted by Mr Haughey at day 88 Q. 192 to 202 of his evidence. Earlier Mr Haughey had been questioned about the source of a lodgement of funds in January 1983. The funds in question, IRL£200,000, had its origin in a GMCT sundry sub account (day 86 Q. 65 to 68). It is possible that this represented a partial draw-down of the loan documented above although Mr Haughey submits that this is not completely clear. In any event, the above evidence given by Mr Haughey to the Moriarty Tribunal and accepted by him as accurate for the purpose of this inquiry shows that Mr Haughey was himself a client of GMCT (subsequently renamed Ansbacher). Consistent with the Inspectors’ approach to the identification of other clients of Ansbacher, once the connection with Ansbacher was established, further investigation of the personal affairs ceased as being not relevant to this Inquiry. The full investigation of these issues is properly left to the Moriarty Tribunal. Two pieces of evidence were, however, disclosed to the Inspectors, which tend to show that at least some of the money available to Mr Haughey was under his effective control. A payment was made from an Ansbacher account of IRL£10,000 to a Mr Conor Haughey in September 1992 and a further sum of IRL£15,000 in November of that year from Hamilton Ross. Mr Conor Haughey is of the view that this was assistance from his father (C J Haughey) in the building of his house. Appendix XV (54) refers. 55. Mr Gerald Hickey, deceased Mr Gerald Hickey had retired from business before he died in 2001. During his career as a practising solicitor he was the chairman of the Hickey Beauchamp O’Reilly legal firm, from which he retired in 1979. He was also a non-executive director of a number of corporate entities including The Industrial Credit Corporation, CRH pic and New Ireland Assurance. He came into contact with Mr Desmond Traynor from about 1969 when they were both directors of New Ireland Assurance, and thereafter acted as a solicitor to Guinness and Mahon. He also took part in meetings with Mr Traynor in which clients of Guinness and Mahon were advised on aspects of offshore trusts. Mr Hickey also undertook a number of property developments and had borrowings from Guinness and Mahon in relation to these, some of which were described in Guinness and Mahon documentation in the 1970s as being ‘suitably secured’. At some stage early in the 1970s Mr Hickey, who claimed to be in a consortium with two non- resident foreign nationals, although that claim was later withdrawn, acquired a property in Abbey Street, Dublin through an Irish company called Clonmel Estates Limited. Besides being a director of the company, Mr Hickey also acted as solicitor to it, and when the property was sold, acted as liquidator to the company. He explained that he distributed the value of the shares by giving the proceeds to Guinness and Mahon who deposited it with GMCT / Ansbacher. The creation of this deposit, which appears to have been controlled by Mr Hickey, is evidenced by a minute of a Guinness and Mahon lending committee on 4 November 1971, in which the impending receipt of the funds is noted, as is a proposal to make available to Mr Hickey an overdraft facility secured on a back-to-back basis against the deposit. Subsequently, on 16 November 1971, Guinness and Mahon wrote to Mr Hickey offering a facility. Appendix XV (55) refers. 56. Mr Jorge Hine & Mrs Margo Hine Jorge Hine and Margo Hine are two residents of the US who negotiated loans with Guinness and Mahon in the mid 1980s. These loans were backed by funds in GMCT. In common with other US based borrowers the GMCT connection was referred to openly in Guinness and Mahon records. One such reference is in the list prepared by M J Pender for London office on 24 December 1986 in which J & M Hine are noted as owing 101,000 (currency unspecified) which is stated to be backed by a GMCT deposit. In a schedule supplied to the Central Bank of Ireland relating to hypothecated loans at 31 December 1988, the loan and deposit are entered as US$ to the value of IR £63,000. Other documents set out below reinforce the connection. Appendix XV (56) refers. 57. Mr Denis A Jackson Mr Denis A Jackson of 7, Vesey Place, Monkstown, Co Dublin is a dentist. At all relevant times, Mr Jackson was non-resident in this jurisdiction. Mr Jackson was identified by Mr Jack Stakelum (under a requirement from the Inspectors) as a client who had money on deposit through Mr Stakelum. In addition to the foregoing there are two Ansbacher documents, which identify Mr Jackson by name. The Inspectors are satisfied that this evidence taken together enables a determination to be made that Mr Jackson was a client of Ansbacher. Appendix XV (57) refers. 58. Mr Thomas Jackson Mr Thomas Jackson was a director of Monarch Properties Limited, a property development company, in the 1970s. A 1976 telex from Mr Desmond Traynor to Mr John Furze of GMCT, showing that Mr Jackson had at that time an account in GMCT, is in the Inspectors’ possession. This telex indicates that instructions regarding Mr Jackson’s account were given by Mr Frank Lee, another director of Monarch Properties Limited. 59. Jamila Pty Ltd. Jamila Pty Ltd had a loan with Guinness and Mahon in 1981. This loan was backed with funds lodged to GMCT. Jamila Pty Ltd is also the ultimate holding company of Wilson Bishop & Co Pty Co Ltd. This latter company had borrowing in its own right from Guinness and Mahon with a Cayman Island connection. Appendix XV (59) refers. 60. Mr William Kearney, deceased The late Mr William Kearney was an obstetrician who resided at ‘Beechwood’, College Road, Cork. Documentation from 1976 shows that he had a deposit account in GMCT at that time. Appendix XV (60) refers. 61. Mr John Kennedy Mr John Kennedy is a director of Sheelin Homes Limited. He has been involved in the building trade since the late 1960s. In his evidence on oath to the Inspectors, Mr Kennedy said that he established a trust in the Cayman Islands in 1986, following discussions with the late Mr Desmond Traynor. The trust funds were held by Penta Investments Limited, a company incorporated in the Cayman Islands. Documents in the possession of the Inspectors, including a document dated 6 December 1993 and signed by John Furze, show that the monies held by Penta were on deposit in Ansbacher’s bank in the Cayman Islands. In his evidence to the Inspectors, Mr Kennedy accepted that this was the case. Mr Kennedy was advised by someone in Guinness and Mahon (he is uncertain whether it was Mr Traynor or another person) that he could choose the currencies in which he wished his funds to be held. He chose the currencies that appeared profitable from time to time. Mr Kennedy said that Mr Traynor told him that if he would entrust him with his money, Mr Traynor would treat it in such a way that if questions were asked, the money would be outside Mr Kennedy’s control. However, Mr Kennedy and Mr Traynor would have an understanding whereby Mr Traynor would make the money available to Mr Kennedy whenever he wished. The scheme depended upon Mr Kennedy placing total trust in Mr Traynor, as Mr Kennedy would have no legal control over the funds. Appendix XV (61) refers. 62. Dr Colm Killeen Dr Colm Killeen is a general medical practitioner and was a near neighbour of Mr Desmond Traynor. From around the early 1980s, Dr Killeen gave Mr Traynor money to place on deposit, but it was not until 1992 that he learned that his money was with Ansbacher. Appendix XV (62) refers. 63. Mr Richard Lawes Mr Richard Lawes, formerly of Crispians, White House Road, Bayleys Hill, Sevenoaks, Kent was a businessman engaged in a number of businesses in this jurisdiction over many years. Mr Lawes died in the United Kingdom on 2 February 1997. A company Picton Investments Ltd (later Olympic Investments), with an address in the Cayman Islands, c/o Ansbacher, held the legal ownership of shares in Connacht Foods Ltd. Documentary evidence connects the two companies, in particular the payment of dividends to Picton Investments Ltd by Connacht Foods Ltd. Money so received was placed on deposit in Guinness and Mahon as early as 1976. Ansbacher was the entity that issued the instruction concerning the deposit. Mr Padraig Collery testified that Mr Lawes (whose first name he did not know) had a connection with these funds. Mr Collery also expressed the view that the relationship between Picton Investments Ltd and Guinness and Mahon was direct and did not involve Ansbacher. This is clearly incorrect as documents below demonstrate. The Inspectors are satisfied that the beneficial owner of the funds was, on the balance of probability, Mr Lawes. Appendix XV (63) refers. 64. Mr Frank Lee Mr Frank Lee, who resides at 2, Perrier Drive, Rochestown Road, Cork, was company secretary of Westboro Investments Limited. A GMCT memo (which, although unsigned, is so identified by its telex code and cable address, 305 Guinness CP) refers to a deposit in the name of Mr Lee. Appendix XV (64) refers. 65. Mr Michael Leyden, deceased and Mrs Dorothy Leyden The late Mr Michael Leyden and his company Leyden Farms Limited, a UK based company, had a business relationship with Mr Jack Stakelum which involved the deposit of funds through Mr Stakelum with Ansbacher. After Mr Leyden’s death in the mid 1980s Mr Leyden’s widow Mrs Dorothy Leyden had a continuing business relationship involving Ansbacher funds until at least June 1991. Leyden Farms Limited was incorporated in 1975 in England. Michael Leyden and Leyden Securities (Scunthorpe) Limited. The shareholders were The Directors were Michael Leyden and Dorothy Leyden who took the shares into their own names in 1977. The company continues to trade under a new name and ownership since 1991 but the new owners appear not to have an Ansbacher connection. Funds were given to Mr Stakelum to place on deposit. These instructions were implemented in such a way that the funds were invested offshore through Ansbacher. Back-to-back loans were given to Leyden Farms Ltd in the 1976 to 1978 period. Appendix XV (65) refers. 66. Mr James Henry Lindsay Mr James Henry (Harry) Lindsay is a former director of and 50% shareholder in Super Ser Limited (‘Super Ser’). Mr Lindsay told the Inspectors that in 1986, while working in Bangladesh, he wished to assure the college fees of his children who were studying in the United States. He contacted the late Mr Desmond Traynor, whom he knew as a result of Super Ser’s dealings with Guinness and Mahon . Mr Traynor told him to give him the money and he would look after it. Mr Lindsay gave him his Bangladesh earnings and Mr Traynor deposited them with Ansbacher. Mr Lindsay continued to pass his earnings from Bangladesh to Mr Traynor, and whenever he needed money to pay fees or other bills for his children he would telephone Mr Traynor and the latter would withdraw it from Ansbacher’s account in Guinness and Mahon and subsequently in IIB. Mr Lindsay closed his account on 31 March 1994 when his children had finished college. It would appear that all the funds in Mr Lindsay’s account came from a source outside Ireland and were used exclusively abroad. Appendix XV (66) refers. 67. Mr Joseph Clayton Love Junior Mr Joseph Clayton Love Junior is a property developer and a former non-executive director of Guinness and Mahon. Mr Love told the Inspectors that, upon the advice of the late Mr Desmond Traynor, he established a trust (known as the Elizabeth Love trust) on 23 April 1971 in the Cayman Islands, in order to make provision for his wife and children in the event that he lost his assets as a result of personal guarantees being called in. He consulted his own accountants Haughey Boland about the matter. Mr Traynor organized all the formalities. The named settlor in the trust Deed was Mrs Elizabeth Love, Mr Love’s wife. The trust deed shows that Mr Love himself was a member of the class of beneficiaries. The trust was funded by the assets of a Channel Islands trust (the Clayton Love trust), which trust held Mr Love’s shares in a property development company called Wildwood Investments. The Inspectors are satisfied, (and Mr Love himself agrees) that he was the wealth generator for the trust. The Inspectors are therefore satisfied that Mr Love, not his wife, was the person who caused the trust to be funded. The trust funds were held by a company called Yale Securities Limited, and placed on deposit with Ansbacher, where they were held in a number of accounts coded ‘M ’. Mr Love told the Inspectors that Mr Traynor gave him annual statements of affairs of Yale. Mr Love also told the Inspectors that at the time the trust was established, Mr Traynor agreed with him that he could borrow from the trust. In Mr Love’s own words: ‘When the trust was set up it was agreed that I use or I borrowed, I think, in the early mid 1970s when things were not too good, I borrowed money at that time from the trust and then I did nothing really until the early 1990s. ’ There was a surprising informality in what were substantial loan arrangements. Nothing was reduced to writing. Mr Love says that there was an oral agreement with Mr Traynor that repayments would be made at a commercial rate of interest. However, no arrangement whatever appears to have been made as to the term of the loan, and indeed, at the date of Mr Love’s evidence to the Inspectors on 8 March 2000, he had made no repayments to the trust, either of capital or of interest. Upon receipt of the Inspectors preliminary conclusion that Mr Love was a client of Ansbacher, his solicitors informed the Inspectors by letter dated 7 December 2001 that Mr Love had repaid capital and interest to Yale in or about August 2000, some five months after he had given his sworn evidence. A further Ansbacher involvement concerns a consortium formed to carry out a development near Phoenix, Arizona, in the US. Upon the advice of Mr Desmond Traynor of Guinness and Mahon, a scheme was constructed involving the establishment of a discretionary trust, (the Lynbrette Trust) of which GMCT was the Trustee. The Trust had as beneficiaries five Cayman companies. Four of these represented the interests of four of the participants. The fifth individual involved was Mr Love, and the fifth company was Yale, but Mr Love has submitted that in the consortium he represented the interests of Yale rather than the converse. In fact, the assets risked in the venture were trust assets in the legal ownership of Yale. Mr Love appears to have made all the decisions in relation to the venture, and indeed never had any contact with the trustees throughout the life of the trust. The Inspectors are satisfied that Mr Love’s ability to borrow in an informal manner from the trust over such a lengthy period without any request for repayment being made until August 2000 indicates that he had de facto control over the funds of the trust. The involvement of Yale in a property venture in which it was represented by Mr Love, and in which the trustees of the Elizabeth Love trust were not involved, taken together with the fact that Mr Traynor provided Mr Love with an annual statement of affairs of Yale, indicates that Mr Love had de facto, if not de jure control of Yale. The Inspectors are satisfied that the fact that Mr Love caused the trust to be funded, Mr Love’s de facto control of the trust funds and his de facto control of the company which held the trust funds and which had an account with Ansbacher, makes Mr Love himself a client of Ansbacher. 68. Mr Bryan Lynam Mr Bryan Lynam is the son of Mr Edward Lynam. In February 1994, Mr Edward Lynam instructed that his Ansbacher deposit (A/A5) be transferred jointly into the names of his son and daughter. At some point in the early 1990s, Mr Desmond Traynor arranged matters so that the deposit was routed through Hamilton Ross. In February 1995, Mr Padraig Collery was instructed by Mr and Ms Lynam to transfer the monies on deposit to another bank, and close the account. Appendix XV (68) refers. 69. Mr Edward Lynam Mr Edward Lynam is a former builder who spent most of his career in E & J Lynam Properties Limited in partnership with his brother, Mr James Lynam. Mr Edward Lynam opened a joint deposit account with his brother in GMCT / Ansbacher at the suggestion of Mr Desmond Traynor in 1979. In 1987 the account was split into separate accounts for his brother and himself, coded A/A5. At some point in the early 1990s Mr Desmond Traynor arranged matters so that the deposit was routed through Hamilton Ross. The account remained in operation until Mr Lynam instructed it be transferred jointly into the names of his son and daughter in February 1994. Appendix XV (69) refers. 70. Ms Eileen Lynam Ms Eileen Lynam is one of two daughters of Mr James Lynam. The Inspectors have found Mr Lynam to be a client of Ansbacher. In June 1995, Mr Lynam, who was becoming increasingly unwell, decided to sub-divide his Ansbacher deposit account, number A/A5-A, into three separate accounts in order that his daughters and he could withdraw funds when required. Ms Eileen Lynam’s account was given the number A/A5-G, and her father told her the value of the opening deposit. She knew the deposit was held in an offshore account in the Cayman Islands, but did not at that time know the name of the bank. Ms Lynam told the Inspectors that she continued to withdraw money from her account in a similar manner to that operated previously by her father. She closed the account in 1997. Appendix XV (70) refers. 71. Mr James Lynam, deceased The late Mr James Lynam of 18 La Vista Avenue, Sutton, Co. Dublin was a partner in E & J Lynam Properties Limited together with his brother Edward. As Mr Lynam was ill at the time of the Inspectors’ investigation, his daughter agreed to give evidence on his behalf. Ms Lynam confirmed the matters set out in her father’s unsworn statement. Her knowledge of her father’s affairs results from conversations she has had with him, and from a search through his papers, which she conducted. In August 1979, following a discussion with the late Mr Desmond Traynor, Mr Lynam gave him money to invest jointly for himself and his brother Edward (see entiy under heading Edward Lynam) in the Cayman Islands. Documentation in Mr Lynam’s possession shows that the money was invested with GMCT. Mr Lynam maintains that it was not a trust, in spite of references in documentation to a letter of wishes. In 1987, this account was divided in two, one account (coded A/A5-A) being for the benefit of James and the other for that of his brother. From 1990 onwards, Mr Lynam made regular withdrawals, which were always in cash. In 1995, he divided the money into three accounts, two of which were for the benefit of his daughters. 72. Ms Mary Lynam Ms Mary Lynam is one of two daughters of Mr James Lynam. The Inspectors have found Mr Lynam to be a client of Ansbacher. In June 1995, Mr Lynam, who was becoming increasingly unwell, decided to sub-divide his Ansbacher deposit account, number A/A5-A, into three separate accounts in order that his daughters and he could withdraw funds when required. Ms Mary Lynam’s account was given the number A/A5-D, and her father told her the value of the opening deposit. She knew the deposit was held in an offshore account in the Cayman Islands, but did not at that time know the name of the bank. Ms Lynam told the Inspectors that she continued to withdraw money from her account in a similar manner to that operated previously by her father. She closed the account in 1997. Appendix XV (72) refers. 73. Mrs Hedli MacNeice, deceased The late Mrs Antoinette Millicent Hedli Anderson MacNeice, widow of Louis MacNiece, was up to 1978 a resident of Kinsale, Co. Cork. She died in France in 1990. In 1978, she had a personal loan from Guinness and Mahon which was secured on a deposit of funds from GMCT, as is clear from a Guinness and Mahon loan decision memorandum of 31 May 1978. She also withdrew money through Guinness and Mahon from time to time, and the withdrawals were debited to GMCT’s account in Guinness and Mahon. 74. Ms Mary Meagher McCarroll Ms Mary Meagher McCarroll is an architect now residing in Dublin. She is the widow of the late Mr Patrick McCarroll (see entry under that heading). Ms McCarroll resided outside Ireland from January 1987 to April 1991, and again from September 1992 to May 1995. In evidence given on oath a short time before his death, Ms McCarroll’s husband told the Inspectors that when he was about to take up employment in Sudan in 1978, he asked Guinness and Mahon to assist him in the setting up of an offshore account, as he believed he would then have non-resident status and would not be liable to pay Irish tax. Mr McCarroll initially believed his money was in Guernsey, but accepted when shown documentation that it was in Ansbacher, and was coded A/A43P. Mr McCarroll further informed the Inspectors that after his marriage, he and Ms McCarroll were working in the United States. He therefore asked Mr Padraig Collery to set up an offshore account for her also. Documentary evidence indicates that this account too was in Ansbacher, and was coded A/A43M. Both accounts were closed in 1993. Appendix XV (74) refers. 75. Mr Patrick McCarroll, deceased The late Mr Patrick McCarroll was an architect who worked in various places around the world during his career. He qualified in 1976 and worked in Dublin until 1978, when he went to Sudan. In 1982 he went to Baghdad. He then worked in Nairobi for a number of years. He was in Ireland from 1986-87, and spent the following two and a half years in the US. He then worked in Portugal for a couple of years. From 1990-1992 he was back in Ireland. He was in Oman from 1992-1994 and was since engaged in project management consultancy in Eastern Europe. He bought a house in Ireland in 1993 and lived there with his wife and child from 1995 until his death in 2000. In his evidence given on oath shortly before his death, Mr McCarroll told the Inspectors that when about to take up employment in the Sudan in 1978, he asked Guinness and Mahon to assist him in the setting up of an offshore account, as he believed he would then have non-resident status and would not be liable to pay Irish tax. Mr McCarroll believed initially that his money had been in Guernsey, but accepted when shown documentation that some of the statements relating to his funds are headed ‘GMCT’. It would appear that his funds, in common with those of many persons whose funds were managed by College Trustees, were deposited subsequently in Ansbacher without his knowledge. Documentation shows that his funds were coded A/A43P. Appendix XV (75) refers. 76. Mr Liam McGonagle, deceased Mr Liam McGonagle was a well-known solicitor practising as one of the partners in a Dublin legal firm. He was also involved with others in property investment. His firm had a normal solicitor - client relationship with the company under investigation. This is not the focus of the Inspectors’ interest in Mr McGonagle. Mr McGonagle died unexpectedly on 14 November 1999 and the Inspectors have had to assess his possible involvement in the absence of his testimony. The Inspectors received the cooperation of Mr McGonagle’s widow, friend Mr Desmond Turvey and his legal partners and wish to record their thanks for the assistance given. There are many apparent contact points between Mr McGonagle and Ansbacher but the Inspectors have been conscious that some of these may have arisen because the late Mr McGonagle acted for clients rather then in a personal capacity. There were a number of transactions, however with which Mr McGonagle was personally involved. Camille Investments Limited was an Irish registered company owned by Mr McGonagle. Prior to its dissolution in 1988, this company had four registered shareholders. Two of these were obviously £1 nominee holders with £98 ordinary shares held by Guinness Mahon Jersey Trust Limited. had 4,500 preference shares. The only other shareholder was Liam McGonagle, who It is clear that Mr McGonagle was the beneficial owner of all the shares. By letter dated 30 March 1988 (attached hereto) Mr McGonagle informed Guinness and Mahon of his exclusive ownership of the Company. Mr Desmond Turvey, a long-time associate of Mr McGonagle, has confirmed this conclusion. An internal memo of Guinness and Mahon 16 August 1978 from Mr Desmond Traynor to Mr P O’Dwyer (attached hereto) deals with a request by Mr Turvey, for a short-term facility for Camille Investments Limited. Mr Turvey was the company secretary of Camille. This memo refers to the situation as being a ‘suitably secured’ situation. It further refers to the holding of $300,000 on deposit from GMCT in this context. Mr Turvey has confirmed that the source of this back-to-back security was British Isles Investments Limited a Cayman company owned by British Isles Trust, which is a trust whose beneficial owner was Mr McGonagle. Further a letter from Mr Martin Lanigan-O’Keefe to Ansbacher for the attention of Mr JD Traynor dated 11 May 1990, set out account details requested by Ansbacher. It appears to be a list of borrowers from Guinness and Mahon in respect of which back-to-back loans existed. In any event the supplying of such information by Guinness and Mahon to Ansbacher, implies that those listed were clients of Ansbacher, as that firm could not be entitled to that information except they had a client relationship with those listed. Mr McGonagle’s name is on the list supplied. Mr McGonagle also had an involvement with the following entities that also used the services of Ansbacher: Kinsale Yacht Charters Limited Beresford Investments Limited These involvements were not necessarily exclusive. Appendix XV (76) refers. 77. Mr Sean McKeon Mr Sean McKeon, of 163, Howth Road, was involved for many years in property development and building. Around 1986, he permitted a discretionary trust to be established in the Cayman Islands, at the suggestion of Guinness and Mahon. He signed some papers including a letter of wishes. GMCT managed the trust (he believed). Mr McKeon received periodic statements from Guinness and Mahon with the name ‘Tara’ on the top. This is believed to be a holding company called Tara Securities Ltd, even though Mr McKeon thought it was the name of the trust. Mr McKeon’s investment was by way of various currencies including US Dollars, Pounds Sterling and Deutschmarks. Mr McKeon terminated his relationship with Ansbacher in 1994 when, by letter of 7 January 1994 to IIB, he withdrew all his funds. Mr McKeon has requested the Inspectors to indicate that the funds were withdrawn in order to make a payment to the Revenue Commissioners under the Tax Amnesty. Appendix XV (77) refers. 78. Thomas J Me Laughlin, deceased Mr Thomas J McLaughlin late of 21 Finsbury House 79/81 Pembroke Road, Ballsbridge, Dublin 4 was a businessman who died 3 January 2000. His executors supplied information to the Inspectorate when requested. Mr McLaughlin was involved with another person in purchasing a property in Portugal through Ansbacher using a trust mechanism and a Cayman Island company, Coral Reef Securities Limited. He also entrusted a substantial sum of money to Mr Desmond Traynor to be put on deposit. This was done through Ansbacher and Hamilton Ross. It was submitted that the fund in question was provided by Mr McLaughlin from after-tax gains and tax-exempt income. It was asserted on Mr McLaughlin’s behalf that he had no knowledge that the sum of money he entrusted to Mr Traynor had been placed on deposit with Ansbacher until after Mr Traynor’s death. It was further submitted that when Mr McLaughlin became aware of this in 1998, he took steps to have the fund repatriated to Ireland, and made contact with the Revenue Commissioners on a voluntary basis to ensure that any relevant taxation liability in relation to the interest earned on the fund was discharged. Appendix XV (78) refers. 79. Mr Patrick McNamee Mr Patrick McNamee is a former Deputy Chief Executive of Fyffes pic. He is now retired. A number of Guinness and Mahon loans made in 1988 to members of Mr McNamee’s family and to his secretary were guaranteed by Mr McNamee. The Guinness and Mahon credit committee recommendations in respect of these loans note ‘the guarantee given may be taken as adequate to the extent o f £50,000’. A letter dated 11 May 1990 Guinness and Mahon to the late Mr Desmond Traynor at ‘Ansbacher, c/o 42 Fitzwilliam Square’ attaches a schedule which the letter describes as ‘the account details requested’. Mr McNamee’s name appears on this with the notation ‘£50,000 (as Guarantor For various facilities)’. A second letter dated the 8 April 1991, same to same, attaches a similar schedule, this time described as a schedule of balances. Mr McNamee told the Inspectors that in 1985 he was awarded a large bonus payment by Fyffes, nett of tax. He stated that he received in total £100,000, which was lodged in either two tranches of £50,000, or three tranches of £40,000, £10,000 and £50,000. The funds were not made available to him directly. Instead, upon the advice either of Mr Neil McCann, a director of Fyffes, or of Mr McCann’s son Carl, who was the financial director of Fyffes at that time, he contacted Guinness and Mahon where he met Mr Padraig Collery. From then on, Mr McNamee contacted Mr Collery whenever he wished to make a withdrawal from the funds, even after Mr Collery’s departure from Guinness and Mahon in 1989. He said that did not know where the funds were deposited, but assumed they were in Guinness and Mahon. A letter dated 19 July 2000 to Mr McNamee from Mr Michael Clerkin of Fyffes confirms that a sum of £50,000 was paid to him towards the end of 1985, but regrets that the underlying documentation no longer exists. Mr Clerkin encloses an AIB bank statement in the name of Fyffes, which records a debit of £40,000 on 14 May 1985. Mr Clerkin believes that this was another part of the payment to Mr McNamee. There is some confusion in Mr McNamee’s mind as to how he received the remaining £10,000, but he is certain that he did receive it. The Inspectors are satisfied that on the balance of probabilities the £50,000 in respect of which Guinness and Mahon wrote to Ansbacher, and in respect of which his guarantees for loans to family and an employee were described as ‘considered adequate’ is one and the same as the £50,000 paid to Mr McNamee by Fyffes in 1985. However, Mr McNamee told the Inspectors that the money earned some interest, which he received. The Inspectors are therefore satisfied that, although he did not himself open the account in Ansbacher, he was the beneficial owner of the funds contained therein. 80. Ms Susan Sheridan Mack Ms Susan Sheridan Mack, 5959, Bay View Circle, South Golf Port, Florida 33707 US was contacted by the Inspectors in connection with her possible connection with an Ansbacher account. She replied through her attorney as follows: As you may or may not be aware, Ms Mack's father John D Sheridan died in Januaiy 1983. Subsequently in 1985 Ms Mack first heard o f Ansbacher and began receiving distributions. Ms Mack has no idea how she acquired her interest, but presumed that it was inheritedfrom her father. Please understand that Ms Mack is (sic,) never considered herself a client o f Ansbacher and still does not do so. Again, she has little knowledge o f the investment and still assumed it was inherited. ’ From the documents inspected by the Inspectors, including in particular a letter from Hamilton Ross to Irish Intercontinental Bank Ltd dated 14 December 1992, the account code relating to Ms Sheridan Mack was A/A56. Appendix XV (81) refers. 81. Ms Mary Maher (nee Lynam) Ms Mary Maher (nee Lynam) is the daughter of Mr Edward Lynam In February 1994, Mr Edward Lynam instructed that his Ansbacher deposit (A/A5) be transferred jointly into the names of his son and daughter. At some point in the early 1990s, Mr Desmond Traynor arranged matters so that the deposit was routed through Hamilton Ross. In February 1995, Mr Padraig Collery was instructed by Mr and Ms Lynam to transfer the monies on deposit to another bank, and close the account. Appendix XV (82) refers. 82. Sir George Mahon, deceased Sir George Mahon (deceased) was a banker and a former director of Guinness and Mahon until his resignation in January 1971. He died on 16 December 1987 and his estate made no mention of any Ansbacher involvement. However, Guinness and Mahon records show a letter dated 11 November, 1977 in which Sir George advises Guinness and Mahon that he expects to receive over US$105,000 for the account of ‘Dursey’. He goes on to request that part of the money should be placed on deposit and the remainder invested in 8% Finance Stock 1980. In a further Guinness and Mahon internal memorandum of 11 May 1976, it is noted that Sir George has requested the purchase of US$25,000 worth of Bank of Scotland 7% % Eurodollar Bonds for Dursey Limited, and that the cost should be debited to Dursey’s Fixed Dollar Deposit Account. GMCT On this note, in handwriting, is the instruction ‘Dr A/Q’ which appears to be an instruction to charge the cost to a GMCT / Ansbacher account with the code A/Q. There are also Guinness and Mahon bank statements for account no. 51656/03/58, which is a US Dollar External Call Deposit bearing the name of ‘Guinness Mahon Cayman Trust A/Q’. Appendix XV (83) refers. 83. Alexander H Major Mr Alexander H Major had an address in 1986 at 31, Union Square West Suite 11300 New York US. His present whereabouts are unknown. It appears that Mr Major had three loans from Guinness and Mahon in 1982 totalling $897,000. It is clear from internal Guinness and Mahon documentation that these loans were back-to-back with deposits held by GMCT. By 1983, the number of loans had grown to four. Substantial repayments were made on 26 August 1986 when the relationship appears to have terminated. Appendix XV (84) refers. 84. Ms Augustina Russek de Malamud Californian based businessmen Mr Isaac Carlos Malamud, Mr Carlos David Malamud and Mr German Malamud opened an account in Guinness and Mahon in January 1982. They borrowed US$550,000.00 to invest in various business interests. The security given was described as follows in the letter of offer dated 28 January 1982: ‘Promissory notes on a joint and several basis signed by all the borrowers supported by ‘audits’ statements of net worth of at least US£7 million and undertakings by all borrowers not to transfer assets out of their ownership or control without lender’s approval.’ A further loan was granted in the sum of US$250,000.00 on 1 March 1982 which sum was increased later to US$450,000.00 and a further US$20,000.00 was later added. At the start of 1984, the total due on foot of all loans was US$1,020,000.00. In 1989, the loans were renewed with Augustina Russek de Malamud replacing Isaac Carlos Malamud. It is clear from the records of Guinness and Mahon that these loans were at all times backed by a deposit of money which originated in Cayman Islands. The borrowers discharged interest due on the loans themselves in the normal way while interest earned on the funds on deposit was sent to Ansbacher for the account of the borrowers. It is not known what structure was in place on Cayman but there are references in the records to the existence of a trust. The Malamud brothers were asked to co-operate with the investigation through Carlos Malamud from and to whom the bank correspondence passed but no reply was received to the request for assistance. Separate notifications were sent to the other family members at the same address, but no reply was received in these cases either. The loans in question and the backing deposits were maintained in Guinness and Mahon until 1994 shortly after the death of Mr Traynor. Appendix XV (85) refers. 85. Mr Carlos David Malamud See entry for Ms Augustina Russek de Malamud. 86. Mr German Malamud See entry for Ms Augustina Russek de Malamud. 87. Mr Isaac Carlos Malamud See entry for Ms Augustina Russek de Malamud. 88. Mr Joseph Malone Mr Joseph Malone, formerly of Ardoyne House, Pembroke Park, Dublin 4 and now resident in the United States, is a businessman who has held a number of high-profile positions in Ireland and in the US. Mr Malone gave evidence to the Inspectors that, in or around 1975, the late Mr Desmond Traynor suggested that it would be ‘appropriate’ for Mr Malone as a non-resident to deposit money in Cayman for tax purposes. He asked Mr Malone for his consent to open an account there for him, explaining that Guinness and Mahon had a ‘branch’ there, and wished to build up its client portfolio. Mr Malone lodged money to the account by transferring it to Mr Traynor. Documentary evidence suggests that Mr Malone’s accounts were coded ‘A/G’. Transfers from the Ansbacher pooled accounts in Guinness and Mahon and IIB to bank accounts in Mr Malone’s name or for his benefit were made by Mr Traynor on Mr Malone’s telephoned instructions. Mr Traynor also bought and sold shares for Mr Malone. They were not registered in Mr Malone’s name, but were in a numbered account in the name of Mars Nominees. He says that Mr Traynor told him that most of the shares he dealt with for Irish residents were held in that way. Profits on the sale of such shares were transferred to Mr Malone’s Ansbacher account. Appendix XV (86) refers. 89. Ronald Markham and Jean Peterson Mr Ronald Markham and Ms Jean Peterson of 1665 S Bayshore Drive Miami Florida USA and P.O. box 129 Sanibel Florida 33957 USA, have failed to respond to the Inspectors’ correspondence. Their present whereabouts are uncertain. For a number of years from 1986, Mr Markham and Ms Peterson borrowed a substantial sum of money from Guinness and Mahon. The borrowing was on a back-to-back basis, with the matching funds being in a GMCT account in Guinness and Mahon. The transactions are well documented. There was also a borrowing in the name of an associated trading entity viz. Apgar & Markham Construction. This appeared to have been backed by the same funds. Appendix XV (87) refers. 90. Mr John A Masek Mr John A Masek d o Synthetic Energy Corporation, 410 1741' Street, Suite 1375, Denver, Colorado, US is a businessman, who has been involved in the oil business in the United States of America for many years. He came to the attention of the Inspectors as he had loans from Guinness and Mahon in the 1980s individually and through a trading entity Kelly Drilling Corporation. These loans are described in the books of Guinness and Mahon as ‘Security Considered Adequate’. Mr Masek when contacted by the Inspectors indicated, that the inquiry may have been appropriate for Kelly Drilling Corporation, but he had no records or recall concerning the financial affairs of the Corporation. The Inspectors are satisfied from information available to them that both Mr Masek and Kelly Drilling Corporation were borrowers from Guinness and Mahon but the funds backing the borrowing were held in GMCT under the name of Mr Masek. Appendix XV (88) refers. 91. Mr Basil Mawdsley Mr Basil Mawdsley, a resident of the United Kingdom, is a former group financial director of Tunnel Holdings, a UK-based producer of building products and speciality chemicals, International Thomson Organisation, a newspaper, business press, oil and travel group, and House of Fraser Holdings. In his evidence on oath to the Inspectors, Mr Mawdsley said that he gave funds to the late Mr Desmond Traynor during the 1970s to place offshore for him. Mr Mawdsley said that he did not know the name of the entity in which his money was placed, but was aware that it was connected with Guinness and Mahon. Documentary evidence shows that the deposit was placed with Ansbacher in accounts coded A/A15 and A/A20. He had both a sterling and a US$ account, the latter bearing the reference ‘re Coral’. Mr Traynor told him that cash from the funds could be made available to him in the UK, and he occasionally availed himself of this facility either by collecting money from the offices of Guinness Mahon and Company in London or from the offices of Henry Ansbacher and Company at 1 Mitre Square, London. Appendix XV (89) refers. 92. Professor Anthony J Merrett Professor Anthony J Merrett had addresses at Mountain Farm Road, P.O. Box 14, Tuxedo Park, Tuxedo New York State, 520 Sylvan Avenue, Englewood Cliffs, New Jersey in the US, and at Kilballyowen, Bruff, Co Limerick. In the 1970s and at least until 1980, Professor Anthony J Merrett had a business relationship with Ansbacher. He had loans from GMCT, which were cash-backed by funds held in Guinness and Mahon in Dublin. Appendix XV (90) refers. 93. Mr Geoffrey Miller Mr Miller was a director of GB Miller & Son. In 1977, GB Miller & Son had a loan from Guinness and Mahon, which was described as ‘suitably secured’. Documents show that in 1990 and 1991, the cost of travellers cheques furnished to Mr Miller by Guinness and Mahon was debited to an Ansbacher account. In his evidence on oath to the Inspectors, Mr Miller said that on the advice of Mr Don Reid of Stokes Kennedy Crowley, a UK company British Cedak Limited, (a distributor of GB Miller & Son which paid GB Miller on a commission basis only), established a company in the Channel Islands whose name Mr Miller cannot recollect. This company was appointed by British Cedak as its advisor for the Irish market. Half of the commission earned by GB Miller was paid into the company. Mr Miller said that he was ‘virtually certain’ that the company was managed by College Trustees. Mr Miller said that he understood he could withdraw money from the fund through Guinness and Mahon, where he dealt usually with Mr Padraig Collery. After Mr Collery’s departure from Guinness and Mahon, Mr Miller continued to contact him when he wished to withdraw money, which he says was once or twice a year, for holidays. He usually contacted Mr Collery by telephone, but on one occasion he went to the offices of CRH at 42 Fitzwilliam Square, where he was handed money in an envelope. Mr Miller says that around the time Mr Desmond Traynor left Guinness and Mahon, the money ‘disappeared from the Channel Islands’. The Inspectors are satisfied on the basis of the documentary evidence that the money was transferred at that time to Ansbacher, where it was coded B/Z, as appears from an Ansbacher statement showing a debit m relation to travellers cheques purchased by Mr Miller. Mr Miller requested, in correspondence of 6 December 2001, that it be noted that he complied with the provisions of the Waiver of Certain Tax, Interest and Penalties Act, 1993. Appendix XV (91) refers. 94. Mr Jerome Morris Messrs Stephen Morris, Joseph Morris, Thomas Morris and Jerome Morris are directors of S M Morris Limited, a company involved in civil engineering and road surfacing. The late Martin Morris was also a director. Mr Stephen Morris gave evidence on oath to the Inspectors, furnished them with all the documentation in his possession and otherwise co-operated fully with them. His evidence was accepted as correct by the other Morris brothers and by the personal representative of the late Martin Morris. In his sworn evidence Mr Morris told the Inspectors that in 1976 the Morris brothers moved money which they had earned overseas, and which was in an account in the Bank of Nova Scotia, Jersey, to a joint account in which each brother held a one-fifth share in Guinness and Mahon. Guinness and Mahon deposited this money with one of its subsidiaries in Jersey. Mr Morris told the Inspectors that in 1989 a discretionary trust (the Optima Trust) was established in the Cayman Islands. John Furze was the nominal settlor and GMCT was trustee. The funds settled on the trust came from the Morris brothers’ Channel Islands account. They were placed on deposit in GMCT by the trustee in an account in the name of Optima Securities Limited. Mr Morris said that the brothers were unaware until a much later date that this movement of funds had taken place. Appendix XV (92) refers. 95. Mr Joseph Morris See entry for Mr Jerome Morris. 96. Mr Martin Morris, deceased See entry for Mr Jerome Morris. 97. Mr Stephen Morris See entry for Mr Jerome Morris. 98. Mr Thomas Morris See entry for Mr Jerome Morris. 99. Mr John Mulhern Mr John Mulhern is a well-known businessman who owns Clayton Love Distribution Limited. He has been involved in that company since 1966. He originally was an employee but, in the early 1970s, took a 55% stake in the company by purchasing the shares of the previous owners. At the same time, Nestle Limited took a 45% stake by the same means. In 1983, the shares of the minority shareholder were transferred to new minority shareholders - College Trustees Limited. This was at that time a Channel Islands company within the Guinness Mahon Group. Mr Mulhern explained that Mr Desmond Traynor arranged this but he did not know on whose behalf the purchase was made. The shareholding remained unchanged until 29 October 1993 when the College Trustee shares were sold back to Clayton Love Distribution Limited for a sum of £3,199,500 in two tranches - IRL£1,422,000 and £1,777,500. Mr Mulhern gave evidence under oath that he did not know the identity of the beneficial owner of the 45% shareholding held in the name of College Trustees. The Inspectors considered it unlikely that College Trustees themselves were the beneficial owners of the shares, as their value was never referred to in internal Guinness and Mahon documents. It was important for the work of the Inspectors to establish who was the beneficial owner as that client of College Trustees had used the services of Ansbacher/Hamilton Ross. The Inspectors learned with surprise in Mr Mulhern’s solicitor’s letter of 13 August 2001 that the ultimate owner of the £1,777,500 was Mr Mulhern himself. This called into question the extent to which the Inspectors could rely on Mr Mulhern’s evidence Mr Mulhern in a statement, which was confirmed on oath, had assured the Inspectors that he had no involvement with Ansbacher. A letter on Ansbacher paper dated 30 July 1992 authorising the transfer of IRL£750,000 from Ansbacher account in IIB to Clayton Love Distribution Ltd was proffered to Mr Mulhern. He explained this as a loan from Mr Des Traynor to his firm, in anticipation of a takeover deal, which never materialised. Mr Mulhern was asked to explain when and to whom it was repaid and to whom interest was paid in respect of this borrowing. An explanation was also sought in similar terms on the details of a further Ansbacher document dated 27 July 1993 relating to a transfer of STG£1,300,000 to Clayton Love Distribution Limited which Mr Mulhern explained as a loan from Mr Traynor. The explanations offered were inadequate in the case of the first loan and practically non­ existent in the case of the second example. In view of the contradictory evidence of Mr Mulhern relating to the beneficial ownership of shares held by College Trustees, the Inspectors do not accept that, in arranging loans from Ansbacher related deposits, Mr Traynor was acting on his own behalf only. The Inspectors conclude that, on the balance of probability, the loans so arranged were also connected with Mr Mulhern’s offshore interests. Mr Mulhern could not explain a charge of £500 in 1974 to the account of Guinness Mahon Jersey Trust account in Guinness and Mahon under the name of John Mulhern Settlement. Mr Mulhern gave evidence that he did not have a Jersey Trust or deposit at that time or at all to his knowledge. A Loan to a subsidiary company, Ice Cream Marketing Limited, which was described as ‘Suitably Secured’ in a number of internal Guinness and Mahon documents, was put to Mr Mulhern. He could not explain the source from which these loans were cash backed. A payment from Ansbacher to Clarkwood Holdings (a Company under the control of Mr Mulhern) of STG£45 on 7 December 1990 was not explained by Mr Mulhern. Mr Mulhern agreed that Mr Traynor had established a company named Debon Arabia Contracts Ltd for his use. It was to this account that the transfer of STG£1,700,178.75 (being the sterling equivalent of the cash received for the Clayton Love Distribution Limited shares) was made on 16 February 1994 from the account of Hamilton Ross. Appendix XV (93) refers. 100. Mr James Murray, deceased The late Mr James Murray, formerly of Hadley, Coast Road, Mornington, Co Meath, was a client of Mr Jack Stakelum. He gave funds to Mr Stakelum in the 1970s to place on deposit. This instruction was implemented in such a way that the funds were invested in Ansbacher throughn Guinness and Mahon. At a later time, Mr Murray took a loan from Guinness and Mahon, which was backed by these funds. He thereafter had a direct relationship with Ansbacher. Appendix XV (94) refers. 101. Mr William Navan Senior, deceased Mr William Navan Snr, formerly of 35 Ballyshannon Road, Portadown, Co Armagh died on 16 September 1990. His daughter, Ms Amanda Navan, and son, William, were his personal representatives. Mr William Navan Jnr died in the following year. Both siblings opened a joint account in Northern Bank to administer their father’s estate. This account received a lodgement of STG£5,000 on or about 19 September 1990. Ms Navan does not know the source. A letter dated 19 September from Ansbacher in Dublin to Guinness and Mahon, relates to the transaction. It is clear that the funds came from Ansbacher account no. 13154602. As the estate that received the benefit of the funds was that of Wm Navan Snr, the Inspectors conclude that he was the owner of the Ansbacher based assets. Appendix XV (95) refers. 102. Mr Maurice Neligan and Dr Patricia Neligan Mr Maurice Neligan is a well-known surgeon and one of the promoters of the Blackrock Clinic. Dr Patricia Neligan, his wife, is a medical practitioner. In 1986, the Neligans borrowed money from Guinness and Mahon, with whom Mr Neligan had previously done business. At about the same time as the loan was negotiated, a sum of IRL£90,000 was placed on deposit with Guinness and Mahon. Part of this was used to buy gilts through a Guinness and Mahon nominee account. The remainder of the deposit, for some unknown reason, was moved without the knowledge of the Neligans into an Ansbacher account called GMCT College ref. MP. They closed their account in 1989. Appendix XV (96) refers. 103. Mr Olivier Nicol Orbit Investments Ltd was a Cayman company with a registered address at the GMCT Cayman office. It was used at various times for a number of persons apparently involved in racehorse ownership and or training. One such person was Olivier Nicol of Haras de la Viette, Le Mesnil-Mauger, 14270 Mesidon, France. A letter of offer from Guinness and Mahon to Orbit Investments Limited addressed to GMCT office in Grand Cayman requests a guarantee from Mr Nicol. A letter from Ansbacher Irish office to Guinness and Mahon on 30 January 1991 also connects the Orbit Investments Ltd with Mr Nicol. Two letters on Orbit Investment notepaper with both Cayman and Irish addresses also involve a reference to Mr Nicol. Appendix XV (97) refers. 104. Mr Michael J O’Keeffe, deceased The late Mr Michael J O’Keeffe was an accountant by profession and a retired banker. Unfortunately he died during the course of the Inspectors’ work. Mr O’Keeffe was seriously ill during the course of the Inspectors work and used his accountant and tax adviser as his agent in this matter. Mr O’Keeffe, through his authorised agent, replied to a request for information by letter dated 21 January 2000 and by further letter of 26 January 2001 enclosing a statement dated 29 November 1999. This communication and all other matters brought to the attention of the Inspectors by Mr O’Keeffe through his agent have been taken into account for the purpose of arriving at these conclusions. Mr Michael J O’Keeffe borrowed funds from Guinness and Mahon in the 1970s. This loan was referred to as ‘suitably secured’ in Guinness and Mahon documentation. In 1976, Mr O’Keeffe requested a Guinness and Mahon official to enquire as to a US$ deposit a/c in GMCT, clearly in the belief that he had such an account. In 1984 Mr Desmond Traynor placed an envelope in safekeeping with Guinness and Mahon under the reference ‘GMCT re Michael O’Keeffe’. 105. Mr Maurice O’Kelly Mr Maurice O’Kelly is a former joint managing director of Guinness and Mahon, which he joined following the takeover by Guinness and Mahon of Commercial Investment Advisers, in which he owned 70% of the shares. He is a chartered accountant by profession, and his friendship with Mr Traynor dates back to 1951, when they were both articled clerks in Haughey Boland. Mr O’Kelly retired from Guinness and Mahon in 1985. In his evidence to the Inspectors, Mr O’Kelly said that when he joined Guinness and Mahon in 1971, he had certain funds available to him from the sale of company shares. These he gave to Mr Traynor to invest. Mr O’Kelly said that he did not know what Mr Traynor did with it, but he now accepts that the money was lodged to a GMCT account on his behalf. He also accepts that the account was coded A/A55. Appendix XV (99) refers. 106. O’Reilly Aerlod (Ireland) Limited O’Reilly Aerlod (Ireland) Limited is a limited liability company which was established in 1985 to take over the business of O’Reilly Aerlod Limited, an air freight company. It was first owned by a group involved in the transport business based in Cork but at the time relevant to its involvement with Ansbacher, a management team headed by Mr Diarmuid Carpendale owned it. The company’s secretary at this time was Mr Desmond Turvey. A liquidator was appointed to the company on 1 March 1995. A sum of STG£6,284.50 was lodged to an Ansbacher account in IIB on 22 January 1991. The cheque was payable to the old company, O’Reilly Aerlod Limited but, on investigation, it was clear that this firm had not received the benefit of the funds. The company secretary, Mr Desmond Turvey, denied any knowledge of the cheque. Mr Diarmuid Carpendale, the former chief executive of the company, gave evidence that the sum was owned by O’Reilly Aerlod (Ireland) Limited and had been lodged as part of a scheme whereby Mr Turvey lodged money, which was later used for the payment of tax-free bonuses to the executives of the firm. The Inspectors accept Mr Carpendale’s evidence and accept that Mr Turvey must have been mistaken. The exact mechanism used to lodge the money is unclear but the combination of Mr Carpendale’s evidence and the lodgement of the cheque to Ansbacher lead the Inspectors to the conclusion that the firm was a client of Ansbacher. Appendix XV (100) refers. 107. Mr Dermot O’Reilly-Hyland, deceased The late Mr Dermot O’Reilly-Hyland was a senior partner in O’Reilly-Hyland Tierney and Associates, and resided at Hollywood House, Glenealy, Co. Wicklow. A document furnished by Guinness and Mahon shows that as at 30 April 1978, a loan held by Mr O’Reilly-Hyland was secured by a deposit held in either Cayman or Guernsey. Later documentation makes it clear that in fact the deposits were with GMCT. An internal Guinness and Mahon document entitled ‘Balances as at 17thAugust 1982 D. O ’R eilly-Hyland' shows four loans and corresponding deposit balances. The deposit accounts are entitled F, FI, F2 and F3. An internal Guinness and Mahon memo dated 18 April 1977 from Mr Desmond Traynor (‘JDT’) attaches G.R.A share certificates and says 7 ... would be grateful if you would arrange to ‘sell ’ crediting Dermot O ’R eilly-Hyland’s account with the proceeds and ‘buy’ on behalf o f Achill Limited debiting the cost to GMCT F I deposit, ’(our emphasis). 108. Mr Ken O’Reilly-Hyland Mr Ken O’Reilly-Hyland of 5/6 Cypress, Hazeldene, Anglesea Road, Dublin 4 is a retired businessman Mr O’Reilly-Hyland told the Inspectors that, having become a ‘name’ at Lloyds, he was advised by his solicitors that it would be prudent to order his affairs by the establishment of an offshore trust. He established such a trust in the Bahamas in the 1960s, which, on the advice of the late John Guinness, he moved to GMCT, Mr Guinness having indicated that GMCT would provide a more cost-effective trustee service. The trust funds were held in GMCT in the name of Newport Agencies Limited. Documentary evidence indicates that the accounts were coded A/D. Appendix XV (102) refers. 109. Mr Michael O’Shea Mr Michael O’Shea, Mr Roger P Ballagh and Mr Terence D E Dixon are solicitors in a Dublin firm. During 1992, fees earned by the firm were given by Mr McGonagle, their late partner, to Mr Desmond Traynor and ended up in an Ansbacher account. The remaining partners have assured the Inspectors that they did not know where these funds were lodged. The sum involved was £40,000 approximately. The money was left on deposit offshore for some time and then shared out among the partners. The payments were made from a Hamilton Ross account in Ansbacher. The IIB dealing tickets show that Mr Ballagh received over IR£11,530, Mr O’Shea and Mr Dixon IR£6,243 each, the firm IR£4,877 and a company controlled by the late Mr Liam McGonagle Stg £6701. All the partners who shared in that fund were thus clients of Ansbacher. The Inspectors’ formal decision on the late Mr McGonagle is to be found elsewhere in the report. Mr Michael J O’Shea, Mr Roger Ballagh and Mr Terence Dixon were clients of Ansbacher, although the Inspectors accept that they were not aware of the location of the funds. Appendix XV (103) refers. 110. Mr John Oppermann and Mrs Eileen Oppermann Mr and Mrs Oppermann, now retired, were the owners of Johnny’s Restaurant in Malahide from 1973 to 1989. The late Mr Desmond Traynor was a frequent visitor to the restaurant. Around 1974 or 1975, Mr Oppermann asked Mr Traynor’s advice as to where he and his wife might invest some money. Mr Traynor offered to invest it for them. It is now clear that he placed the funds in GMCT, where, as appears from an internal Guinness an Mahon memo of 18 August 1981, they were held in an account coded A/A7. From then on, the Oppermanns gave him sums of money from time to time. It also happened occasionally that Mr Traynor held a dinner party in the restaurant, and instead of paying the bill, lodged the amount to the Oppermanns’ GMCT account. Appendix XV (104) refers. 111. Pettit International Ltd Pettit International Ltd is part of E G Pettit, an Irish based consulting engineering company with offices in Dublin and Cork. The Inspectors note that the company underwent a complete change of ownership in October 1997. In the 1982/3 period, Pettit International Ltd used the services of Guinness and Mahon and GMCT on a number of occasions. It is clear from the documents available to the Inspectors that Pettit International had an account with GMCT. The current owners of the company, who provided the Inspectors with information available to them, state that this GMCT account was used by the former company to service income generated by their overseas trading operation. They have assured the Inspectors that the funds lodged to the GMCT account comprised money earned from their overseas operations only and that no funds were ever transferred from Ireland to the account. Appendix XV (105) refers. 112. Dr Michael Phelan Dr Michael B Phelan resides at 53 Great Cumberland Place, London. The Inspectors are in possession of documentation showing that Dr Phelan received a number of payments from Ansbacher accounts in Guinness and Mahon and OB. As one document shows, the payment in question was debited to coded account A/A20. The Inspectors wrote to Dr Phelan seeking information on 4 May 2000. On 15 May he telephoned the Inspectors’ solicitor Ms Mary Cummins explaining that he had just returned from holidays. He then gave her certain information over the phone. She asked him to put this in writing for the Inspectors, and he agreed to do so, having however explained that he was unwell. On 16 June 2000, the Inspectors’ secretary Ms Frances Gaynor wrote to Dr Phelan reminding him of the Inspectors’ request and seeking to arrange an interview. On 3 July, no response having been received from Dr Phelan, Ms Gaynor telephoned him at his home. Dr Phelan told her that he had no information or documents to impart to the Inspectors, and that an interview would be a waste of time. A second telephone conversation on the following day did not advance matters. On 7 July 2000 Ms Gaynor wrote again to Dr Phelan suggesting an interview in London. She asked him to provide a medical certificate in the event that he was unable to attend an interview on health grounds. This was provided on 14 July 2000. In the absence, therefore, of any evidence from Dr Phelan himself, the Inspectors have been obliged to arrive at their preliminary conclusions on the basis of documentary evidence in their possession. 113. Ms Marily Power Ms Marily Power is the part-owner of Suma Stud in Co Meath. In 1977, a trust was constituted in the Cayman Islands on Ms Power’s behalf for the purpose of holding assets in the United States belonging to her. John Furze was the nominal settlor and GMCT was the trustee. A letter of wishes signed by John Furze indicates that he expects Ms Power’s instructions to be taken in connection with any capital or income distributions from the trust. A Cayman company, Jumelol Investments, managed the assets of the trust, which it placed on deposit with GMCT. Appendix XV (107) refers. 114. Mr Fernando Pruna and Mrs Eudelia Pruna On 21 December 1985, the credit committee of Guinness and Mahon approved a loan to Fernando Pruna and Eudelia Pruna (hereinafter called ‘the Prunas’) in the sum of US $135,000. This was the first of a series of transactions that had serious repercussions for GMCT, Guinness and Mahon and Mars Nominees. Deposits of the same sum backed the borrowing from GMCT. This was the first of a series of loans to the Prunas, which totalled at one time US $ 1,068,000, all backed by GMCT deposits. The Inspectors have had the benefit of The Ninth Memorandum of Evidence prepared by Ms Sandra Kells of Guinness and Mahon for the Moriarty Tribunal. Mr Cathal McCarthy has adopted this document as his evidence in his capacity as legal adviser of Guinness and Mahon. For a fuller understanding of the matters raised relative to these loans, that document (exhibited hereinas 1(a)) should be consulted. Appendix XV (108) refers. 115. Mr Seamus Purcell Mr Seamus Purcell is a company director and businessman operating in the livestock processing and exporting sector, initially as an unincorporated entity, Seamus Purcell & Company, but from the 1980s as Purcell Exports Limited, and in Northern Ireland as Ulster Meats Limited. Mr Purcell was introduced to Guinness and Mahon by a business acquaintance around 1975 and came into contact with Mr Desmond Traynor. Guinness and Mahon provided Mr Purcell’s business with bid and performance bonds to enable it to secure livestock export contracts. Mr Purcell needed US dollars to pay his overseas agents’ commissions (some of which were secret), and in the early 1980s, Mr Traynor offered to facilitate him with an external dollar account. Some export earnings from the Canary Islands were used to open the US dollar account in the name of Guinness Mahon Cayman Trust ‘Y ’ Account, number 41229/03/68. Into this account was lodged a Banco Intercontinental Espanol cheque for US$432,438.24, payable to Seamus Purcell. The photocopy of the cheque bore the words ‘File Seattle Securities’. Mr Purcell accepted these funds were related to his business activities, but denied having been aware of the GMCT ‘Y ’ account or Seattle Securities at the time. On occasion, commission payments were made in Ireland and, by going to see Mr Traynor in Guinness and Mahon, Mr Purcell could obtain cash or drafts in dollars. Mr Purcell said he was not advised by Guinness and Mahon of any breach of exchange control regulations and he left all of that to the bank. A Guinness and Mahon document on 6 February 1984 recorded the opening of a Deutschemarks loan account in the name Purcell Exports Limited for DM6,000,000. Guinness and Guinness records also indicate the opening of a Deutschmark deposit account on 8 February 1984 into which was deposited DM5,797,090.14, and the account name was GMCT ‘Y ’ C/o P Collery. The account was annotated ‘Back-to-back with DM loan’. Once again Mr Purcell said he was unaware of these accounts. However, he also said he spent much of each year travelling abroad on behalf of his business, and did not, in consequence, deal with its administration. The Inspectors conclude that Mr Seamus Purcell, as the beneficial owner of Seamus Purcell & Company and Purcell Exports Limited, was a client of Ansbacher. Appendix XV (109) refers. 116. Mr Diarmuid Quirke, deceased The late Mr Diarmuid Quirke was an executive director of CRH pic from 1980 to his retirement in 1991. Mr Quirke died on 21 September 1994. Mrs Joan Quirke, his widow, and the executor of Mr Quirke’s estate assisted the Inspectors in their investigation. The Inspectors accept that her knowledge of the matters within the remit of the Inspectors is minimal. She has however explained the context in which certain traveller’s cheques were issued to her husband and herself. A number of points of contact exist between Mr Quirke and Ansbacher based on the documentation available to the Inspectors. On 22 October 1985 an amount of IR£960 was transferred from the account of Amiens Securities m Guinness and Mahon to Mr Quirke’s account in that bank. Amiens was used by Mr Traynor for the processing of small Ansbacher transactions but this transaction alone would not be sufficient proof of a client relationship between Mr Quirke and Ansbacher. On 29 July 1991 a cheque payable to Mr Quirke from Bluehill Investments Ltd in the sum of STG£2872 was lodged to Ansbacher account in HB. Bluehill Investments Ltd was a Guernsey company used by CRH to assist in the financing of the acquisition by CRH of overseas companies, in the course of which it reimbursed, in sterling, expenses incurred in connection with this work by executives and directors of CRH. On 7 January 1992 Mr Quirke wrote to a CRH executive as follows: I enclose second statement o f sterling expenses fo r calendar year 1991. I would request that you would forward your cheque to M s Joan Williams at 42 Fitzwilliam Square who will be authorised to deal with it on my behalf On 14 January 1992 US$4,000 was withdrawn from Guinness and Mahon account of Ansbacher re Poinciana and used to purchase travellers cheques for Mr Quirke and his spouse. On 23 January 1992 a cheque in sum of STG£3125 from Bluehill Investments Ltd payable to Mr Quirke was lodged to Ansbacher account in IIB. These latter three events are obviously connected. Ms Williams at that time was the secretary of Mr Traynor in CRH but her only banking role was as an assistant in Mr Traynor’s Ansbacher banking service to his/the bank’s Irish customers. Ansbacher’s service was used to facilitate the purchase of these travellers’ cheques and Mr Quirke was familiar enough with how the system operated to direct the incoming funds to Ms Williams. On 13 September 1993, sterling travellers cheques to the value of IR£1324.59 were made available to Mr Quirke and his spouse through the Bank of Ireland account of Kentford Securities Ltd. This account was used exclusively for the provision of cash and Irish pound cheques for clients of Ansbacher, as IIB did not have a cash facility. It is only to this limited extent that Mr Quirke appears to have used Ansbacher’s services but the full context of the above contacts satisfies the Inspectors that Mr Quirke was a client of Ansbacher. 117. Mr Jeremy Robson Mr Jeremy Robson appears to have been UK based and used the offices of GM & Co London to collect cash withdrawals from his Ansbacher account. Mr Robson’s name appears on a number of Ansbacher-related documents indicating that he regularly withdrew funds that were debited to Ansbacher or GMCT accounts. The withdrawals, although made in Guinness Mahon and Co London, were always made on the instructions of either Guinness and Mahon or IIB, themselves acting on earlier instructions from the late Mr Desmond Traynor. A memo from Mr Traynor dated 4 June 1986 links Mr Robson with the Wentworth Trust, a GMCT trust. Many GMCT statements in Guinness and Mahon show transactions relating to this trust. A sample only is attached hereto. Appendix XV (111) refers. 118. Mrs Sonia Rogers Mrs Sonia Rogers is the widow of Captain Tim Rogers. She is the owner of Airlie Stud, Maynooth. Mr Padraig Collery, an employee of Ansbacher in Ireland during the relevant period, gave evidence to the Inspectors of making payments to Mrs Rogers’ secretary from an account held with Ansbacher in the name of Hamilton Ross. This account was coded A/A3. Statements of the A/A3 account show lodgements and withdrawals from 1992 onwards. Mrs Rogers informed the Inspectors that she gave the proceeds of two insurance policies to the late Mr Traynor in 1988 to fund the education of one of her children. She said that she had no knowledge of where Mr Traynor had lodged the funds. She believed that the payments she received from Mr Collery were repayments of the amounts she had given In cross-examination by Mrs Rogers’ lawyers, Mr Collery said that the payments he had made to her over the years were debited by him to a memorandum account A/A3. This memorandum reflected movements on an account held in the name of Hamilton Ross. As is clear from the statements of account A/A3, Hamilton Ross held funds in Ansbacher’s bank in the Cayman Islands. Mr Collery agreed when questioned by the Inspectors that this meant that Mrs Rogers was the beneficial owner of part of the funds held in Hamilton Ross account A/A3. The Inspectors are therefore satisfied that Mrs Rogers funds were deposited with Ansbacher. Appendix XV (112) refers. 119. Captain Tim Rogers, deceased The late Captain Tim Rogers was a well-known stallion owner and stud farmer. He died in 1984. The Inspectors received evidence on oath from his widow, Mrs Sonia Rogers. Mrs Rogers said that after her husband’s death, Mr Desmond Traynor told her that her husband had established an offshore trust for her benefit and that of their children. At a later stage, Mrs Rogers learned that the trust was in the Cayman Islands. Mr Traynor told her that the trust ‘dealt in bloodstock’ through a company called Ascot Holdings. Appendix XV (113) refers. 120. Mr John Savoy Mr John Savoy appears to be a resident of the United States. In 1984, he was an officer of Southeastern Commodities Inc, a US company whose registered address in 1984 was 1080 SW 12th Avenue, Pompano Beach, Florida. The company went into liquidation in that year. In 1984, the company had a loan from Guinness and Mahon backed by funds held in Guinness and Mahon in an account entitled ‘Guinness Mahon Cayman re Southeastern Commodities external offset D/A The loan was also initially guaranteed by GMCT, but this guarantee was subsequently cancelled and replaced by the personal guarantee Mr Savoy. The GMCT funds on deposit with Guinness and Mahon were themselves backed by a deposit in the same sum placed with GMCT by a GMCT company, Cool Breeze Investment Corporation, of which Mr Savoy was the beneficial owner. The Inspectors are satisfied therefore that the funds backing the Guinness and Mahon loan were beneficially owned by Mr Savoy. Appendix XV (114) refers. 121. Schwartz Management Company Schwartz Management Company is a company registered in the state of Delaware, in the U.S. Outside Delaware, its principal place of business is in Iowa, where its registered office is 520 Walnut Street, Des Moines, Iowa 50306. Its business is described as that of managing the financial and business affairs of other companies, and dealing in metal products. Its president was Mr Ben Schwartz, recently deceased, whose most recent address was 1909 North Clifton Avenue, Chicago, Illinois 60614. He also had an address at PO Box 10363, Des Moines, Iowa 50306. In the 1980s, Schwartz Management Company had a loan from Guinness and Mahon, which was backed by a deposit held in Guinness and Mahon in the name of GMCT. In 1983, this loan was the largest on the bank’s books, standing at US$10.3 million. Appendix XV (115) refers. 122. Mr Joseph Seeley Mr Joseph Seeley was a Company Director of a number of Irish based companies including Westward Cables Ltd, Westward Horizon Ltd, Horizon Distribution Ltd and Histon Securities Limited. According to information contained in a Guinness and Mahon internal document, the facility in the name of Histon Securities (loan £119,000 and £20,000 letter of credit) was originally advanced in 1984 in connection with the purchase of shares in Western Cables Limited. That firm was involved in multi-channel TV installation in Limerick and elsewhere. Security is described as ‘adequate’. A further internal memorandum of Guinness and Mahon dated 24 December 1986 lists Histon Securities as College Trustee clients for whom ‘College have arranged deposits here through GMCT’. Mr Seeley and his wife are listed as the sole shareholders in Histon Securities Limited. In an internal Guinness and Mahon document relating to security for a company loan, Mr Seeley alone (rather than he and his wife together) is requested to personally guarantee the loan. This indicates that Mr Seeley was the controlling shareholder. Appendix XV (116) refers. 123. Mr Sidney Seymour, deceased The late Mr Sydney Seymour died on 31 October 1992. He had appointed his wife as his executrix, but unfortunately she died on 17 December 2000 before she could assist the Inspectors in their investigation. The Inspectors are satisfied that the remaining members of the family do not have any relevant information. In these circumstances, the Inspectors have considered this matter on the basis of the documents available from a number of sources and the evidence of Mr George Crampton. Mr Seymour was employed for many years by G&T Crampton Ltd, an Irish based building company. He was also a director of that company. In the early 1970s, this company arranged that a number of trusts were established in the Cayman Islands for the benefit of its directors. These trusts were to be managed by Ansbacher. Each of these trusts was to be given the name of Whitethorn and identified by ‘A ’, ‘B ’, ‘C’ etc. The Inspectors have documentary evidence that one such trust was established and the testimony of Mr Crampton infers that the other trusts were also established. The Inspectors, in the case of Mr Seymour have additional information in that he is identified after the relevant time as having a loan from Guinness and Mahon that is described as ‘suitably secured’. The Inspectors conclude from the above information that Mr Seymour was a client of Ansbacher. Appendix XV (117) refers. 124. Mrs Nora Shanahan Mrs Nora Shanahan lives at 8, Clifton Gardens, London W9 IDT. Unfortunately, due to the lack of co-operation of Mrs Shanahan, the Inspectors have been unable to confirm any of the details necessary to report fully on her. They have established the following, however: It appears that Mrs Shanahan had a business connection with Ansbacher in the 1990s. From records available to the Inspectors the following transactions took place in and out of Ansbacher/Hamilton Ross accounts in IIB (all sums sterling): 14 October 1991 lodgement STG£30,000 27 August 1990 withdrawal STG£5,000 Further withdrawals of STG£5,000 were made on 28 August 1991, 8 April 1992, 21 January 1993, 26 July 1993, 3 March 1994, 6 January 1995, 6 December 1995, and 19 October 1996. As appears from the letter dated 2 October 1991, Mrs Shanahan’s account number was A/A48. Appendix XV (118) refers. 125. Mr Michael J Shanley Mr Michael J Shanley of Tingrith Manor, Tingrith, Milton Keynes, England, is a director of a number of Irish companies, among them Shanley Hotels (Ireland) Limited. The Inspectors wrote to Mr Shanley in December 2000, and despite a number of reminders and a formal requirement to attend before the Inspectors to give evidence on oath, either in Ireland, or if more convenient, in England, Mr Shanley did not reply until July 2001. In that letter he refused to comply with the Inspectors’ requirement to attend before them, and said he would write a letter of explanation ‘eventually’. He added that if the Inspectors still had questions upon receipt of the proposed letter of explanation, he might consider a meeting, but that in any event, this would not be before November 2001. The Inspectors find Mr Shanley’s response unacceptable, and have been obliged to proceed to a preliminary conclusion without the benefit of his evidence. The Inspectors heard evidence from Mr Thomas Kevin Smith, a former director of Maybach Investment Company Limited (‘Maybach’), a company that had a loan from Guinness and Mahon described by the bank as ‘suitably secured’. From their evidence and from documents in the possession of the Inspectors, it emerged that an Irish trust known as the Maureen O’Brien Settlement was established in 1970 to benefit ‘the grandchildren and more remote issue o f Thomas and Bridget Shanley Funds from the sale of a property in Raheny, Dublin, were settled on the trust. A letter of wishes signed by the settlor (Mr Shanley’s sister) makes it clear that the wishes of Mr Shanley are to be taken into account by the trustees in making distributions. The letter of wishes also indicates that it might be desirable that monies should be made available to assist businesses promoted by Mr Shanley. The trust lent money to a company called Keeladrum Investments Limited, with an address c/o GMCT, who placed it on deposit with Ansbacher. The funds so deposited were used as security for a loan obtained by Maybach from Guinness and Mahon. On 12 January 1978, College Trustees, the trustees of the Katharina Settlement, a Channel Island trust, acquired the full issued share capital of Maybach. In May 1980, the trustees of the Maureen O’Brien Settlement resettled the trust fund on the Katharina Trust and in due course, the trustees of that trust lent the funds interest-free to Maybach. Considerable documentation in the possession of the Inspectors indicates that Mr Shanley was the beneficial owner of the funds in the two trusts. Three documents are of particular significance. The first is a letter dated 21/22 January 1987 from Mr Smith to Mr Shanley, from which it emerges that Mr Shanley had issued instructions concerning the beneficiaries of the Katharina Trust. The second document is a letter dated 18 February 1986 from Mr Smith to Mr Shanley discussing the accounts of Maybach. The third significant document is a letter dated 21 January 1987 from Mr Smith to Mr Ellis of College Trustees. The Inspectors’ copy of this letter is of such poor quality as to be almost illegible, but on the second page, one can discern the following sentence: ‘M r Shanley would like to lodge with you a letter o f intention in regard to the proportions in which he would like named beneficiaries to benefit under the trust and from time to time he may wish to amend the said letter. ’ The above documents clearly show that Mr Shanley exercised control over the Katharina Trust funds. Since the funds in the Katharina Trust are the same funds that were held previously by the Maureen O’Brien Settlement, and since, as the Maureen O’Brien Settlement Deed shows, Mr Shanley was not a beneficiary of that settlement, the only inference that can be drawn from his subsequent exercise of control over the funds is that he was at all times the beneficial owner of them. This includes the period during which they were on deposit with Ansbacher. Appendix XV (119) refers. 126. Mr John D Sheridan Mr John D Sheridan, who died in 1983, was a client of Ansbacher. For the avoidance of doubt and any possible confusion with others of the same name, the deceased has a daughter resident in Florida, Ms Susan Sheridan Mack. Ms Susan Sheridan Mack was contacted by the Inspectors in connection with her possible connection with an Ansbacher account. She replied through her attorney as follows: LAs you may or may not be aware, Ms Mack's father John D Sheridan died in Januaiy 1983. Subsequently in 1985 Ms Mack first heard o f Ansbacher and began receiving distributions. Ms Mack has no idea how she acquired her interest, but presumed that it was inheritedfrom her father. Please understand that Ms Mack is (sic,) never considered herself a client o f Ansbacher and still does not do so. assumed it was inherited. ’ Appendix XV (120) refers. Again, she has little knowledge o f the investment and still 127. Mr Jack Stakelum Mr Jack Stakelum is a chartered accountant and company director, and was a close personal friend of Mr Desmond Traynor. In the 1960s they were partners in the accountancy firm of Haughey Boland. In the early 1970s when Mr Stakelum was still with Haughey Boland, Mr Traynor suggested a scheme whereby Mr Stakelum borrowed a substantial amount from Guinness and Mahon on which he claimed tax relief on the interest. In a Guinness and Mahon listing of loans the loan is described as being suitably secured. The funds were placed with an offshore company, the name of which has not been established but in which Mr Stakelum was beneficially interested, which placed them on deposit offshore. Mr Stakelum said the offshore bank might have re-deposited the money with Guinness and Mahon. Mr Stakelum acknowledged that this was a classic suitably secured situation of the time. After leaving Haughey Boland in 1975 Mr Stakelum set up Business Enterprises Limited, a company from which he offered financial services and business advice. From around 1976-77 some of Mr Stakelum’s clients had funds abroad which they asked him to ‘monitor’ on their behalf. Mr Stakelum arranged with Mr Traynor that these funds were transferred to Guinness and Mahon and placed on offshore deposit. Thereafter he offered a service to his clients whereby, using a business name entity called Clyde Enterprises, he accepted Irish pound lodgements for, and provided withdrawals from, the offshore account which he described as a ‘hotchpotch account’ containing funds belonging to a number of his clients. In another section of the report the Inspectors have considered carefully the evidence available to them as to the location of the offshore entity into which Mr Traynor deposited the funds given to him by Mr Stakelum, and they have concluded that the hotchpotch funds were on deposit with Ansbacher. Since Mr Traynor and Guinness and Mahon did not know the names of the individuals whose combined funds made up the total of the hotchpotch account, it follows that the account was operated by Mr Traynor as being under the control, and therefore the legal ownership, of Mr Stakelum. The beneficial ownership of the funds, according to Mr Stakelum, remained pro rata with his individual clients. Further, by letter of 1 August 1990, Mr Traynor instructed Guinness and Mahon to arrange for travellers cheques for US$6,000 to be issued in the name of John J Stakelum and charged to Ansbacher account number 13154977. Mr Stakelum accepted that this withdrawal came from a US dollar offshore account separate from the main hotchpotch account, and that the cost was charged to him. Mr Stakelum enjoyed the use of the funds nominally deposited abroad, but held in Ireland through an Ansbacher account in Guinness and Mahon, by means of a service provided by Ansbacher and Mr Traynor whereby he was able to withdraw funds in Ireland. Appendix XV (121) refers. 128. Mr Sam Stephenson Mr Sam Stephenson is a well-known Dublin architect. He has been a property developer in consortia with others, which on a number of occasions included the late Mr Desmond Traynor. Until the mid 1970s, when a disagreement arose between them resulting from the then property crash, Mr Stephenson characterised his relationship with Mr Traynor as one of a very close partnership and friendship, and said that Mr Traynor was of great benefit as an advisor. Starting in the early 1970s, Mr Traynor placed monies representing Mr Stephenson’s share of property development profits on deposit with Ansbacher, which was then known as GMCT, in Cayman. Mr Traynor suggested that it would be prudent for Mr Stephenson to have a family trust in Cayman. Mr Stephenson, while accepting that the creation of a trust had been mentioned to him, did not accept that he had any knowledge of the actual setting up of a trust. The Ansbacher deposit was used to provide security for property development loans from Guinness and Mahon, and these loans were described as being ‘suitably secured’. In the mid 1970s property crash, Guinness and Mahon wished to see Mr Stephenson reduce the level of his borrowings, and the Ansbacher trust deposit was used by Guinness and Mahon to offset liabilities arising from development losses. Appendix XV (122) refers. 129. Super Ser Limited Super Ser Limited (‘Super Ser’) was a company operating in Ireland up to the 1980s. Its shareholders were Mr Harry Lindsay and Mr Chris Goosen. It is no longer in existence, and the Inspectors wish to stress that any company currently bearing the same or a similar name has no connection with Ansbacher. Mr Harry Lindsay told the Inspectors that Super Ser had substantial deposits with Ansbacher. This is substantiated by an extract from a 1978 report on Guinness and Mahon by the Central Bank which refers to Super Ser having at that time funds on deposit with GMCT. According to Mr Lindsay, this account was opened to finance dealings conducted by Super Ser in the United States. He said that the funds were subsequently exhausted in repaying debts owed by Super Ser to Guinness and Mahon. Appendix XV (123) refers. 130. Mr and Mrs Peter Tamburo Mr and Mrs Peter A Tamburo resided in 1974 at 2520 Dellago Drive, Fort Lauderdale, Florida, U.S.A. In 1974, following discussions with the late Mr Desmond Traynor, John Furze of GMCT arranged to form a trust and a Cayman company, Windsor Securities Limited, on Mr Tamburo’s behalf. In 1981, the company acquired shares in Tunnel Holdings Limited, a UK-based manufacturer of asbestos products, which shares were held in the name of Overseas Nominees Limited, GMCT’s nominee company. Appendix XV (124) refers. 131. Mr Kazuaki Tazaki Mr Kazuaki Tazaki is a former director of Brother International Corporation (Europe) Limited (‘Brother’). He came to Ireland from Japan in 1960 to take up employment with that company. He became a member of the board of directors in 1968. In 1970, he left Ireland to work with Brother in Manchester. When Brother International Corporation (Ireland) Limited was incorporated in 1974, he became a director of that company also, while remaining in England, where he continues to reside. At all relevant times, Mr Tazaki has been resident for tax purposes outside the jurisdiction. In his evidence on oath to the Inspectors, Mr Tazaki said that when he left Dublin in 1970, he got a bonus payment from Brother. This was transferred to the late Mr Desmond Traynor by Mr Tazaki’s employers. Mr Tazaki could not explain why the money was sent to Mr Traynor rather than to him. Mr Traynor told him that the money would be placed in a trust. In the late 70s or early 80s, Mr Tazaki learned that the trust in question was in the Cayman Islands. Mr Tazaki received statements from Mr Traynor showing balances for a sterling account coded A/J and for a US$ account in the name of Titan Investments Limited. He had no doubt that these were statements of the account of his offshore funds. Documents shown to Mr Tazaki at interview show that these accounts were in GMCT. Appendix XV (125) refers. 132. Ms Carmel Traynor Ms Carmel Traynor, of 63 St Anne’s, Kimmage Road West, Dublin 12, is a sister of the late Mr Desmond Traynor. In the mid 1970s, Ms Traynor invested a small sum through her brother. She was not aware of where the money was invested and did not deal with it for many years. On her brother’s death in 1994, she requested the repayment of her investment. Some time later, another brother, John, made arrangements for the payment of the funds through Mr Padraig Collery. The repayment was made in cash and the exact sum is unknown to Ms Traynor. In reaching their decision, the Inspectors noted the evidence of Mr John Traynor concerning the closing by him of Ms Carmel Traynor’s account, after the death of Mr Desmond Traynor, through Mr Collery. The only cash under the control of Mr Collery after Mr Traynor’s death was Hamilton Ross money, which had been (in respect of any money on deposit prior to 1 January 1993) Ansbacher funds. Ms Traynor’s money had been on deposit a far longer time. The Inspectors conclude that Ms Carmel Traynor was a client of Ansbacher, although she may have been unaware of the fact. Appendix XV (126) refers. 133. Mr James Desmond Traynor, deceased The late Mr James Desmond Traynor was one of the founding directors of GMCT, and was its representative in Ireland. He was later its Chairman. He commenced his career in 1950 as the first articled clerk in Haughey Boland & Company, Chartered Accountants, where he remained until 1969. When he left Haughey Boland, Mr Traynor joined Guinness and Mahon and remained there until 1986. He was a director of Guinness and Mahon from 1969 to 1986. He was chairman of CRH pic from 1987 until his death in 1994. He was in his later years one of the leading figures in the Irish business community. Mr Traynor had substantial deposits with Ansbacher, which at the time of his death were mostly contained in accounts in the name of Hamilton Ross and Poinciana Fund. Both of these companies were owned by the Poinciana Trust, Mr Traynor’s Cayman Island trust. Mr Traynor was also the beneficiary of an earlier trust of which GMCT was trustee. It is not clear whether this trust was taken over by the Poinciana Trust, or whether it continued to have a separate existence. Appendix XV (127) refers. 134. Mr Joseph Turley Mr Joseph Turley (Senior) is a director of Rathdown Motors. His earlier career was in the car rental business, and he commenced a family firm, Argus Automobiles, sometime in the 1970s. Loans obtained by Mr Turley from Guinness and Mahon for himself and for Argus Automobiles, are described by Guinness and Mahon as ‘suitably secured’ or ‘considered adequate’. Mr Turley told the Inspectors under oath that he could not understand why his loans would be so described, and he denied any connection with Ansbacher. An internal Guinness and Mahon document with the title entitled ‘Joseph Turley Argus Automobiles Limited GBM Plastics’ signed JR/CC and dated 4 September 1989 states ‘[Mr Turley’s] facilities ... were provided on the basis that security was adequate to the extent o f STG£lm.) Due to the Bank’s changing relationship with the offshore connections and in particular with the departure o f Padraig Collery from G&M, it has been agreed with Mr Turley that our facilities with him/Argus/ GBM should now be formalised without regard to the adequate security. It is proposed that G&M should take security over a number o f investment properties owned by Mr Turley’. Mr Turley’s knowledge of the backing deposit is clear from the previous reference, and also from an internal Guinness Mahon & Co memorandum dated 28 September 1989 headed ‘J Turley connection - G&M Dublin’. It includes the following remarks: ‘7he present limits to the [Guinness Mahon] Group are set out on page 1 o f the accompanying memoranda and total an exposure o f £450,000 and these are currently secured by ‘adequate’ deposits which are effectively under [Guinness and Mahon ’s] control. The Committee will be aware o f the background o f such security and the fact that, in certain cases, this may be withdrawn in the foreseeable future. This is one case where the customer has been informed that the Bank would prefer to have such arrangements conducted elsewhere, unless additional security could be provided. ’ Finally, a letter from Mr Desmond Traynor to Guinness and Mahon gives rise to the inescapable conclusion that the offshore entity holding the backing funds is Ansbacher. The letter, dated 9 January 1990, is on paper with the Ansbacher letterhead and it requests a note of balances for a number of accounts, among which are Resident Loan accounts in the names of GBM Plastics and J Turley. There is no evidence that the beneficial owner of the backing funds is anyone other than Mr Turley. Appendix XV (128) refers. 135. Mr Martin Turley Mr Martin Turley resides at 309 West Columbine Street, Santa Ana, California 92907, US. In response to the Inspectors’ general letter of enquiry, Mr Turley replied that he had no information relating to Ansbacher. The Inspectors responded with a specific query on 26 June 2000, but have received no further reply from Mr Turley. A fax dated 11 November 1994 from the late Mr John Furze of Ansbacher directs the transfer of substantial funds from an Ansbacher account in IIB to an account in the name of Mr Turley in Ulster Bank Limited, International Division, Belfast. Mr Martin Turley of 309 West Columbine Street, Santa Ana, California 92907, U.S.A. has failed to give the Inspectors the co-operation to which they were entitled and arising there from, consideration should be given by the appropriate authorities as to whether an application should be made for a disqualification order, pursuant to S. 160.(2)(e) Companies Act 1990, in respect of Mr Turley. Appendix XV (129) refers. 136. Sir Charles Villiers, deceased The late Sir Charles English Hyde Villiers MC was a director of Guinness Mahon London between 1971 and 1976. From documentation available to the Inspectors, it appears that Sir Charles had an account in GMCT for many years prior to his death. Appendix XV (130) refers. 137. Dr Oliver Waldron Dr Oliver Waldron resides at 3 Kingston House North, Princes Gate, London SW7 1LN. Dr Waldron furnished the Inspectors with an unsworn statement and certain documents. Dr Waldron informed the Inspectors that he lived abroad between 1965 and 1972. Upon his return to Ireland from Canada in that year, he established a trust with GMCT. The beneficiaries were his children. The assets settled on the trust were acquired abroad, where they were held in a number of companies controlled and managed by GMCT, one of which was called Inter Agent Limited. Dr Waldron says that small amounts from the trust funds were paid out to him from time to time in Ireland to defray expenses on behalf of his children. In 1983, he moved permanently to England, and at that time, he withdrew all of the trust funds to pay for his children’s education. Appendix XV (131) refers. 138. Mr Joseph Walsh Mr Joseph Walsh is a retired businessman and former Joint Managing Director of his family business, P Walsh & Sons Limited, Kilkenny. Mr Walsh met Mr Desmond Traynor in the course of business, and when, around 1972, Mr Walsh said he wish to leave some money to his nephews and nieces, Mr Traynor proposed the creation of a discretionary trust in the Channel Islands. Mr Walsh gave Mr Traynor in the region of £100,000 by way of a loan to get the trust going, and Mr Traynor said it could be taken back later if he needed the money. Mr Walsh made no further lodgments to the trust. In 1995, Mr Walsh’s brother died suddenly and he decided to withdraw the value of his ‘original loan’ and give the money to his brother’s children. By this time Mr Traynor had also died and Mr Walsh did not know how to make contact with his trust. He sought help from Mr Paul Carty of Deloitte & Touche who put him in touch with Mr Padraig Collery, who obtained a withdrawal. At this stage Mr Walsh learned that his trust funds were in the Cayman Islands. As part of obtaining information resulting from the Inspectors’ inquiry, Mr Walsh’s solicitor telephoned Ansbacher who told him that on 27 November 1989 a Cayman discretionary trust had been established which owns a Cayman company called Drogheda Investments Limited. The trust continued in existence after the sole withdrawal. 139. Mr Ivan Webb, deceased The late Mr Ivan Webb was Managing Director of G & C Crampton Ltd. He died in June 1972. Shortly before he died, arrangements were made to establish a number of trusts in the Cayman Islands. There were six in number, designated Whitethorn A, B, C, D, E, and F. It is clear from correspondence available to the Inspectors that the intention was that Whitethorn F trust was to be the vehicle to be used by Mr Webb. As Mr Webb died within three months of these arrangements being made, it is not possible in his case to describe the exact sequence of events that followed from the preliminary decision to establish the Whitethorn F trust. The Inspectors have, however, established that, after the death of Mr Webb, an account existed in Ansbacher and later under the control of Hamilton Ross Limited, which held funds apparently intended for the trust. The money transferred to the Ansbacher account was administered for many years in the same way as other funds deposited at that time, leading to the conclusion, on the balance of probability, that the trust was in place prior to the death of Mr Webb. (The Inspectors are further satisfied that the beneficiary of these funds took no action with regard to the establishment or maintenance of the trust after Mr Webb’s death.) Appendix XV (133) refers. 140. Ms Joan Williams Ms Joan Williams of 21 Stradbrook Grove, Blackrock, Co. Dublin, was secretary to Mr Desmond Traynor, both during his time at Guinness and Mahon and at CRH. She is now retired. In her evidence to the Inspectors, Ms Williams said that Mr John Furze of GMCT told her during one of his visits to Ireland that he would open an account for her in GMCT and that he would lodge some money to it. She regarded this as a gift. She said that she had been told that a memorandum account coded ‘A/A7’ was her account. Mr Furze made lodgements to the account from time to time. Ms Williams made some withdrawals from the account, which is still in existence. Appendix XV (134) refers. 141. Mr Robert Willis Mr Robert Willis is a former director of Irish Life, CRH and Banque Nationale de Paris. Mr Willis knew the late Mr Desmond Traynor very well and regarded him highly. Knowing of Mr Traynor’s connection with Guinness and Mahon, Mr Willis asked him to open a deposit account for him, and from then on, gave cheques to Mr Traynor from time to time for lodgement to that account. He usually gave him these cheques in an informal manner, on the premises of CRH. Mr Willis told the Inspectors that he did not know where Mr Traynor had opened the account, and he did not enquire, as he trusted Mr Traynor absolutely. He said that whenever he wished to make a withdrawal, he asked Mr Traynor to transfer funds to an account in the Royal Bank of Scotland. The Inspectors have a number of documents containing instructions from or on behalf of Mr Traynor to transfer funds to Mr Willis’ account in that bank, and the documents show that the amounts withdrawn were always debited to an Ansbacher account. Appendix XV (135) refers. 142. Mr Robert Wilson Mr Robert Wilson is a businessman and former chairman of Robert Wilson & Sons (Ulster) Limited and Robert Wilson (Ireland) Limited both of which went into receivership in 1983. Mr Wilson has been tax resident abroad since 1985. Mr Wilson came into contact with Mr Desmond Traynor when the latter worked with Haughey Boland, who provided audit services to the Robert Wilson companies. In the early 1970s, Mr Traynor became a director and shareholder of the companies. Around 1977, Mr Wilson discussed with Mr Traynor the creation of a discretionary trust for the benefit of his family and himself. The trust was set up through GMCT with £40,000 from Robert Wilson & Sons (Ulster) Limited. The trust operated through a Cayman registered company called Northern Finance Limited which appears to have ceased trading as at 4 January 1993. In 1978, Robert Wilson (Ireland) Limited obtained a loan of IRL£125, 000 from Guinness and Mahon and this was described as being backed by a Cayman deposit in a report by the Central Bank as at 30 April 1978. Over the years from about 1984 onwards, Mr Wilson obtained withdrawals from the trust funds by contacting Mr Traynor. Some of these were effected by transfers from Guinness and Mahon and later IIB, directly to Mr Wilson’s account in Ulster Bank, Dublin. Appendix XV (136) refers. 143. Wilson Bishop Tolley & Co Pty. Wilson Bishop Tolley & Co Ltd is an Australian-based company. It had a number of loans with Guinness and Mahon in the 1970s and 1980s. These included loans in 1978 of US$90,000 and DM150,000. By 1981 these loans were US$90,000 and DM40,000. These loans were described in the books of Guinness and Mahon as ‘suitably secured’ in 1978 and as ‘fully backed by GMCT’ by 1981. On 27 January 1981 an internal Guinness and Mahon memorandum advises Mr Desmond Traynor of funds in US$ and DM placed in Guinness and Mahon through GMCT. A note from GMCT dated 3 March 1981 also connects Wilson Bishop Tolley & Co Pty Ltd with GMCT. Appendix XV (137) refers. 144. Adolf Franz (Burschi) Wojnar, deceased The late Mr Adolf Franz Wojnar (normally known as Mr Burschi Wojnar) was a Dublin based businessman who was involved in a number of companies up to the date of his death on 7 May 1993. These entities included MW Wallpaper Specialists Ltd, Fletcher & Phillipson Ltd and Foxrock Securities Ltd. The Inspectors interviewed Mr Wojnar’s sons, Christopher and Bernard, for the purpose of assessing whether their father was a client of Ansbacher. The following transactions were identified by the Inspectors as relevant to the issue: In early 1977, Foxrock Securities Ltd borrowed a sum of £9,000 guaranteed by Mr Burschi Wojnar. Under the heading of security, an internal Guinness and Mahon document notes that a ‘‘Suitably secured’ situation will exist in due course. ’ Later in 1977, MW Wallpaper Specialities borrowed a sum of £10,000 from Guinness and Mahon. This was described as ‘suitably secured’ in the books of Guinness and Mahon and was to be guaranteed by Mr Burschi Wojnar. In 1978, Fletcher & Phillipson Ltd borrowed a sum of £87,000 so that Mr Burschi Wojnar could purchase shares in that company, held by his wife, as part of a family arrangement. The borrowing is described in the books of Guinness and Mahon as ‘suitably secured’ to the extent of £37,500. Mr Wojnar guaranteed this loan also. A document produced by Guinness and Mahon in 1978 for the Central Bank lists the Foxrock Securities loan as backed by a Guernsey deposit. A report from Guinness and Mahon to their London Head office, dated 24 December 1986, lists Fletcher & Phillipson as a College Trustee client for whom College have arranged backing deposits in Dublin through GMCT. A further loan of £100,000 in 1988 was guaranteed by Mr Burschi Wojnar and designated ‘considered adequate’. While there are many references in the documents available to the Inspectors describing loans as ‘suitably secured’ or ‘adequately secured’, there is only one document which identifies an Ansbacher connection i.e. the list of 24 December 1986 referred to above. Mr Christopher and Mr Bernard Wojnar in evidence stated that they had no knowledge of any of the above transactions. They were directors of the family companies over many of the relevant years and they confirmed that these companies did not appear to have any offshore funds It is noteworthy that the late Mr Burschi Wojnar, who was the principal shareholder in the companies, guaranteed each loan. It therefore appears probable that the offshore funds were under the control of Mr Burschi Wojnar. In addition to the foregoing Mr Jack Stakelum has confirmed, on foot of a requirement from the Inspectors, by letter 30 July 2001 that Mr Burschi Wojnar had offshore deposits through his system. 145. Mr Richard Wood Mr Richard Wood is chairman of John A Wood Limited. He was a director of CRH from 1981 to 1997. Mr Wood gave evidence that his late father was involved with a group of businessmen in property speculation in the 1960s and 1970s. They established a trust in the Cayman Islands called the Whitethorn No 7 Trust. This trust owned all the shares in a company called Hexagon Securities Limited (‘Hexagon’). The funds of the trust were deposited in Hexagon’s name in GMCT, in accounts coded A/G. Mr Wood’s father died on 29 January 1972. A letter dated 16 March 1977 from Mr John Furze of GMCT to Mr Wood, sending him statements in relation to the trust and asking him to sign them, indicates that GMCT regarded Mr Richard Wood as its client. Upon the dissolution of the trust in 1977, the funds were distributed to Youghal Development Company Limited, of which Mr Woods was the sole shareholder, and Thrush Securities Limited, of which he also was a shareholder, although it is unclear to what extent. Appendix XV (139) refers. 146. Mr Christopher Woodward Mr Christopher Woodward of 3 The Green, Branksome Hill Road, Dorset, United Kingdom, was an employee of Guinness Mahon Jersey Trust, who was the Settlor of many of the trusts established in Jersey through a Guinness and Mahon subsidiary on that Island. In 1975, these trusts were re-organised so that Guinness and Mahon Jersey Trust Limited took over as trustees. Some time later, Mr Woodward resigned as director of the companies operating the trusts. By 1984, correspondence with Guinness and Mahon shows that Mr Woodward had broken or was about to break all links with the operation and his concern was to relocate to London. In the event, this occurred. Any examination of the documents in which Mr Woodward’s name appears is complicated by his nominal involvement in the affairs of others. The benefit of the doubt has been given to Mr Woodward and all references that appear to relate to his work as a trust official, have been assumed to be on behalf of others. When the above exclusions have been made there remain a number of references that appear to relate to Mr Woodward as an individual. There are clear references in these documents to a GMCT account in the name of Mr Woodward and to the involvement of Mr John Collins, a GMCT executive, in the private affairs of Mr Woodward. Appendix XV (140) refers. 147. Mr Ronald Warren Woss Mr Ronald Warren Woss c/o 14 Business Park Drive Notting Hill Victoria 3168 Australia is a businessman who had a close connection with the late Mr Desmond Traynor. He was a director of a number of companies withm the trust structure of Mr John Byrne i.e. Danstar Holdings Pty (an Australian company) and Tepbrook Properties Limited an UK company. The reasons for these involvements are not known but they do not appear to be connected with any ownership. The Inspectors have written to Mr Woss seeking his assistance in their work without any response. A number of records available to the Inspectors have references to Mr Woss. An Ansbacher letter dated 11 February 1991 to IIB seeks a payment to Mr Woss from memorandum account A/A36. Further, a letter from Hamilton Ross directs a payment from Hamilton Ross account A/A26 to a travel company apparently in connection with the travel arrangements of Mr Woss. These references on their own would not be sufficient to suggest a connection between Mr Woss and Ansbacher of the type on which the Inspectors are required to report. From the time the business was transferred to IIB from Guinness and Mahon in 1991 accounts were in existence under the code A/A26 in the name of Ansbacher and later Hamilton Ross. These were always treated in a special way and were the subject of a weekly report from Ireland to Australia. This reporting was not done directly by IIB or Ansbacher/Hamilton Ross but was organised by Mr Sam Field Corbett, a Dublin based provider of secretarial and other services through a company called Management and Investment Services Ltd. The Inspectors were anxious to establish the beneficial owner of the A/A26 funds and raised the issue with Mr Field Corbett. He informed the Inspectors that he was not aware of who was the ultimate owner as he was only providing the service at the request of Mr Traynor. He did however confirm that the person to whom he conveyed the weekly information was Mr Woss in Australia. The weekly reporting from IIB was a continuation of a similar system, which operated when the funds were in Guinness and Mahon. This latter information together with the above mentioned payments are sufficient to allow a conclusion to be drawn. Appendix XV (141) refers. 23.4 Category B: List of persons who were clients of Ansbacher through College Trustees. 1. Mr Douglas Armstrong 2. Blue Jeans Limited and JB Agencies Limited 3. Mr Ray Carroll 4. Mr Liam Cassidy 5. College Trustees 6. Mr Tom Conaty 7. Mr Stephen Daly - deceased 8. Mr William Forwood and Mrs Joyce Forwood 9. Mr Ronald T Fredette 10. Mr Colm Hyland 11. Mr Denis McCarthy 12. Mr Harold F Murray 13. Mr Brian Rhatigan 23.5 Description of Category B clients 1. Mr Douglas Armstrong Mr Douglas Armstrong has been involved in a number of companies in the electronic field over many years. One of the main companies was Armstrong Electronics Limited. Mr Jack Stakelum is a long time associate and advisor. Mr Armstrong has had a long time business relationship with Guinness and Mahon. Mr Armstrong was interviewed on January 31 2001 for the purpose of establishing whether he was a client of Ansbacher. Because of the contradictions between the evidence given by Mr Armstrong, which evidence was supported in writing by Mr Stakelum, and the documentary information available to the Inspectors, it is necessary to set out in some detail the facts of the case. The following facts are evident from the documentation in the hands of the Inspectors: 1. Armstrong Electronic Limited and its associated firms have been doing business with Guinness and Mahon since the mid 1970s. 2. Money was borrowed from time to time to finance the business of various companies. 3. Many of the loans were designated within Guinness and Mahon as ‘adequate’ ‘considered adequate’, or ‘adequately secured’. This has always, in the experience of the Inspectors, meant a back-to-back security not necessarily based on Ansbacher funds. Mr Stakelum does not agree that this is a correct interpretation. Three documents dated September 1985 (in some cases the date is arrived at by inference), and further documents dated November 1986, 1 June 1988, April 1990 all use these formulae of words indicating security outside this jurisdiction. 4. The route by which this security existed is signposted in a Guinness and Mahon memo dated 24 December 1986, which identifies Armstrong Electronics’ security as being in a category, which Guinness and Mahon call ‘College Trustees clients for whom College have arranged backing deposits here through G.M.C.T.’ In evidence Mr Armstrong was unable to explain these matters but maintained his position that neither his nor any other money abroad had backed his companies borrowings. The Inspectors concentrated on the Jersey Island connection, as this appeared the likely original source of any backing funds. Armstrong made a number of statements: On his firm’s involvement with Jersey Mr (a) At page 23 of the transcript he seems to suggest that he had no business in Jersey but this is taken by the Inspectors to be an error of understanding and Mr Armstrong is given the benefit of the doubt in this regard. (b) He states at page 5 of the transcript as follows: Q. You are using a Jersey based company for your non-Irish activities, is that right? A. No not at the moment, no. We did one time. (c) When asked the name of his Jersey Company at page 24 of transcript Mr Armstrong identifies the company as Enterprise Trading, which was not owned by him but by Mr Stakelum. However, an internal Guinness and Mahon memo dated 14 June 1991, based on an interview between Mr Stakelum and Mr Armstrong on the one hand and the Guinness and Mahon on the other, reports as follows: ‘Outside of the Armstrong operation D.A. has expanded his activities into Europe using a Jersey based company’. In addition to Armstrong Electronic Limited a back-to-back loan was negotiated for Wilfield Securities Limited, another Armstrong company. The Inspectors have considered the evidence in its entirety and conclude that on the balance of probability the power to dispose of and pledge the offshore funds rested with Mr Armstrong as the majority shareholder in the Irish companies who received cash backed loans. In a situation where Mr Armstrong was the owner of almost 100% of the shares in the various companies, the likelihood of any other person providing back-toback cover was remote. Appendix XV (142) refers. 2. Blue Jeans Limited and J B Agencies Limited. Blue Jeans Limited was a Guernsey based limited liability Company. It was operated and controlled by College Trustees Limited until it was liquidated in 1995. It is clear that, over a long number of years, Blue Jeans had deposits under the control of College Trustees. As part of the scheme operated in the 1980s by the Guinness Mahon group of companies, the Blue Jeans Limited account was directed through GMCT. Blue Jeans had a strong Irish connection. On 7 February 1986 an account in the name of the company was opened in Guinness and Mahon by way of the lodgement of STG£22,462.90. This account continued to operate until 4 February 1987. There are also many examples in the Guinness and Mahon files of loans by Guinness and Mahon to an Irish company JB Agencies Limited by way of letter of credit facilities between 1986 and 1990. These borrowings were backed by guarantees given by Blue Jeans Limited from its Guernsey office. Typical of such arrangement is a faxed note dated 26 June 1990 from Blue Jeans Limited to Guinness and Mahon as follows: ‘We wish to confirm that we are willing to guarantee letter o f credit facilities to yourselves up to a maximum o f Sterling £475,000. We can provide collateral in the fom i o f cash deposits in support o f any such guarantee. (Signed) For Blue Jeans Limited. ’ Blue Jeans Limited was operated by College Trustee personnel from the office of College Trustees Limited in Guernsey. In common with many of College Trustee clients, the money it held on deposit was channeled through GMCT. This is borne out by a letter dated 12 January 1988 from Blue Jeans Limited to Guinness and Mahon, which authorized the disclosure of information to the firm’s auditors of account referred to as ‘Guinness Mahon Cayman Trust Limited for account of Blue Jeans Limited’. internal Guinness and Mahon account listing has a similar listing. An The Inspectors have attempted to identify the owners of Blue Jeans Limited. Mr James Sweeney and Mr Terry Kennedy, the owners of JB Agencies, the firm receiving the guarantee, gave evidence that the Guernsey firm was an offshoot of their Belgian supplier. The Belgian supplier (Mr Roland Wallaert) denies this in equally strong terms. Because of the lack of cooperation of College Trustees, that issue has not been easily resolved. The Inspectors have attempted to uncover other external information which would indicate which of the explanations is most likely correct. No information has been discovered linking Mr Wallaert to Blue Jeans other than the testimony of Mr Sweeney and Mr Kennedy, which is disputed by Mr Wallaert. There are two matters showing a link with J B Agencies and/or its principals. 1. A letter dated 5 September 1985, Mr Collery (of Guinness and Mahon) to Guinness Mahon Guernsey Limited, which refers to a payment to ‘Mr Jim Sweeney of Blue Jeans Ltd’. Mr Sweeney explains this as a contribution to a cinema advertising campaign by Wally Jeans (the supplier owned by Mr Wallaert) to J B Agencies. 2. An internal Guinness and Mahon credit memorandum of 27August 1988 contains the following note: J B Agencies has been a client since 1983. As turnover increased so did its L/C requirements. The appendix summarizes the trading results and financial position. Small profits/break even has been the norm though this does not accurately reflect the true nature o f the business. Accounts fo r year ended 30/4/1988 are due shortly and are expected to show an increase in declared profits. Management is experienced in rag trade and the account is well conducted. IR£307k. year. Security is considered adequate to the extent o f This is likely to increase to IR£400k approximately in the coming This reference to IRL£307k is a reflection of the same sum stated to be available for back-to-back purposes at that time. It is clear that the author of the above document within Guinness and Mahon thought that J B Agencies beneficially owned the deposit of Blue Jeans Limited The net value of the Irish company (J B Agencies Ltd) in 1988 was IRL£12,353 and in 1989 IRL£19,369. borrowing needed. This was obviously not adequate for the level of It follows that offshore funds were funds that were owned by the company or its promoters, on which Guinness and Mahon could rely. Appendix XV (143) refers. 3. Mr Ray Carroll Mr Ray Carroll 6 Clonfadda Wood Blackrock Co Dublin is a retired businessman. The Murray group of companies formerly employed him in the capacity of Chief Executive. His alleged involvement with Ansbacher can only be understood in the context of his employment and his shareholding in the Murray group. It is therefore necessary to set out in broad terms the reasons why this shareholding is relevant to the issue to be decided by the Inspectors. Mr Harold F Murray was the founder of the Murray group of companies, which group has been involved in the car sale, rental and general motor trade in Ireland over many years. In 1974 the late Mr Murray caused to be established a trust based in Jersey called the Woodward Trust. The trust operated through Sumac Investments, a Jersey based company. According to evidence received by the Inspectors, the money deposited was money realised by the sale of a company asset. College Trustees managed money sent to the Woodward Trust in 1974. For some time the funds were in Guinness and Mahon in Dublin having been deposited from Jersey but later in or around 1981 these funds were channelled through Ansbacher under its then title of GMCT. This was done without reference to those who controlled the funds. Evidence was given that up to 1994 (when the money was withdrawn and declared for the tax amnesty) the funds of the trust were used to back loans to the group. Some money was distributed from Jersey to the beneficiaries in 1980. The beneficiaries included Mr Ray Carroll who had a 9% interest in the Murray group and a similar entitlement to the funds lodged abroad. At that time, however, the GMCT connection may not have occurred and this payment is considered by the Inspectors not to be an Ansbacher connected transaction but is relevant in establishing Mr Carroll’s ownership of part of the trust funds. The Inspectors received evidence that the money was ultimately transferred to a number of directors of the Murray Group at the time of the tax amnesty under the direction of Mr Harold F Murray. In respect of Mr Ray Carroll, an issue arises as to whether he was the true owner of part of the funds at the time these funds were on deposit in GMCT. Executive of the Group between 1977 and 1991. He was the Chief The Inspectors conclude that his entitlement to part of the funds was established as a right from at least 1980 and that his share was not dependant on the grace and favour of Mr Harold F Murray or any other person but was a right which could have been enforced in law from 1980 onwards at the latest. In so far as it is clear from the documentation that the offshore funds of the Group were in GMCT from 1981 onwards, Mr Ray Carroll must be considered a client of the company now known as Ansbacher by reason of his ownership of part of those funds. 4. Mr Liam Cassidy Mr Liam Cassidy is a former director of Cassidy Silks Limited. Because of his present state of health, he declined to attend for interview, and he provided a medical certificate, which the Inspectors were happy to accept. However, without the benefit of Mr Cassidy’s assistance, the Inspectors have been obliged to arrive at their preliminary conclusions on the basis of documentary evidence. Mr Cassidy is adamant in his correspondence with the Inspectors that he never had any connection with Ansbacher. However, Guinness and Mahon documentation shows that Cassidy Silks had a loan in the 1970s that is described as ‘suitably secured’ Further documentation shows that Mr Cassidy and his wife Vera obtained travellers cheques from Guinness and Mahon in 1985, and that the cost of the cheques was debited to an account in Guinness and Mahon entitled ‘Guinness Mahon Cayman Trust College This account held monies belonging to clients of College Trustees, which College Trustees had deposited with Ansbacher, frequently unknown to those clients. The Inspectors have therefore concluded that Mr Cassidy placed funds with College Trustees in the Channel Islands, and that College Trustee deposited those funds with Ansbacher. Appendix XV (145) refers. 5. College Trustees Ltd College Trustees Ltd itself has been found to be a client of Ansbacher from 1981 to 1989 approximately. Appendix XV (146) refers. 6. Mr Tom Conaty Tom Conaty Ltd with a registered office at 73 May Street, Belfast 1 and a place of business at Balmoral Fruit Market is involved in fruit brokering. Mr Tom Conaty is the majority shareholder in the company. As early as 1977, Guinness and Mahon (Ireland) Limited (hereinafter Guinness and Mahon) was granting loans to Tom Conaty Ltd. The loans were described as ‘suitably secured’ indicating a deposit outside the jurisdiction not necessarily Cayman based. There is a similar reference in a 1978 loan. In April 1988, an executive directors’ meeting within Guinness and Mahon considered an application to renew the facility of Tom Conaty Ltd of Balmoral Fruit Market Belfast. The application was supported by a guarantee of Mr Tom Conaty and was designated as ‘adequately secured’. On 16 May 1983, Tom Conaty Ltd was paid STG£1,500 from a Guinness Mahon Cayman Trust / College account. Mr Tom Conaty of 4 O’Neill’s Place, Holywood, Co Down, a director of the company, was written to concerning these matters but did not respond until the Inspectors issued a preliminary conclusion to him. By letter of 13 September 2001, Mr Conaty’s solicitor forwarded a statement from their client. It is clear from the statement provided by Mr Conaty that Mr Conaty held funds offshore through College Trustees. It is also evident from the documentation relating to the payment of 16 May 1983, referred to above, that College Trustees held those funds in a GMCT/College Trustee account in Guinness and Mahon. The Inspectors note that Mr Conaty submits that he gave instructions to College Trustees to hold the funds in Guernsey rather than the Cayman Islands. Mr Conaty accepts in his statement that: The money was held for his benefit.... In those circumstances it is not proposed to make any adverse conclusion against the limited liability company. Appendix XV (147) refers. 7. Mr Stephen Daly, deceased The late Mr Stephen Daly was a primary school teacher until his retirement in 1988. As a summer holiday activity between 1958 and 1974, he organized ‘affinity charter’ flights to the US as a one-man operation. In 1974 he set up Irish Teacher Projects Ltd, which organised educational tours for teachers to the US. He subsequently operated ITP Travel Ltd. Surpluses arising from his charter operations were deposited with Guinness Mahon Guernsey in 1978 on the advice of Mr Martin Keane. College Trustees controlled the funds in an account reference GMCT College ref. TC431 which was part of the Elinor Trust, of which Mr Daly was the beneficial owner. Mr Daly communicated periodically with College Trustees about his investment, which was spread over a number of foreign currencies managed by NM Rothschild & Sons (Cl). Mr Daly made a further lodgement to the Elinor Trust in 1983, whereby he took funds to the UK for lodgement to the Channel Islands via the Isle of Man. Mr Daly terminated his relationship with Ansbacher in 1994. Appendix XV (148) refers. 8. Mr William Forwood and Mrs Joyce Forwood Mr William Forwood qualified as a solicitor and became a partner in a law firm in London. In 1967 he was invited to join Guinness and Mahon, and became co-Managing Director in 1968 with Sir George Mahon and Mr John Guinness, specialising in the area of mergers and acquisitions. Mr Forwood was involved in setting up the GMCT corporate legal arrangements in the early 1970s. In May 1976, Mr Forwood discontinued his employment with Guinness and Mahon and resigned as a director in November 1976. Around 1969 / 1970, Mr Forwood caused a Channel Islands trust called Rockford Investments to be set up for the benefit of his wife, Joyce, and himself as well as others, into which was invested the property associated with a one third share of a farm in Buckinghamshire inherited from Mrs Forwood’s father. the trust. College Trustees administered Mr Forwood believes other assets were subsequently invested in the trust. Mr and Mrs Forwood were beneficiaries under this trust, which was wound up in 1993. At some stage in the early 1980s, Guinness and Mahon arranged for the funds held in the trust to be invested through GMCT, and a Guinness and Mahon bank statement of January 1987 for an account named Guinness Mahon Cayman Trust / College records a lodgement of STG£2,000 ‘re. Rockford’. Further confirmation of the position is recorded in a letter of 17 May 1991 from Ansbacher requesting IIB to accept lodgement of a cheque payable to Rockford Investments for STG£1,057.50 to an Ansbacher account No. 02/01087/81. Reference to the linking of the Rockford Investments assets to loans made by Guinness and Mahon to a property development company called York Securities Limited is contained in an extract of a 1985 Guinness and Mahon report to the Central Bank entitled ‘Loans set-off against Deposit Accounts’. This links IR£ loans to York Securities with a deposit in the name of Rockford Investments. Mr Forwood said he was unaware that Guinness and Mahon had linked the loans to the Rockford Investments deposit. This had been done without his authority, and in any event the trust assets were largely land rather than cash. A further reference to the backing of the loans to York Securities Limited, in which Mr Forwood held an equity interest together with others, is demonstrated by a Guinness and Mahon credit committee memorandum of 1986 in which the security for three loans to York Securities was described as ‘adequate’, and the comment that ‘the loan is cash backed’. The Inspectors conclude that Mr William Forwood and Mrs Joyce Forwood were clients of Ansbacher, but accept that they thought, wrongly, that, as their trust was in the Channel Islands, their deposit was also there. Appendix XV (149) refers. 9. Mr Ronald T Fredette Mr Ronald D Fredette with an address in 1985 at 63 Soundview Road P.O. Box 471 Guilford, Conneticut 06437, US, had a banking relationship with Gumness and Mahon in the mid 1980s. Money was also lodged to an US $ account in Guinness and Mahon with the account holder as Guinness Mahon Cayman Trust/College re R Fredette. Appendix XV (150) refers. 10. Mr Colm Hyland Mr Colm Hyland was a shareholder in and director of GB Miller. Guinness and Mahon documentation describes a loan furnished to Mr Hyland in 1977 as being ‘suitably secured’. In evidence on oath, Mr Hyland told the Inspectors that while he was a shareholder in GB Miller, a trust was established in the Channel Islands for the purpose of lodging overseas commission earned by the two shareholders, Mr Hyland himself and Mr Geoffrey Miller. Mr Miller had earlier given evidence to the Inspectors that in fact an offshore company was established. It is not clear whether or not there was a trust, as Mr Hyland thinks, but in any event Mr Hyland understood at the time that he could withdraw money from time to time in Ireland. He did this through Mr Padraig Collery. Mr Hyland believes that the fund was at all times in the Channel Islands. However, a Guinness and Mahon statement of account in the name Guinness Mahon Cayman Trust.College shows two transactions in 1984 with the reference ‘Hyland”, showing that the funds had been deposited by College trustees with GMCT. Mr Hyland was a client of Ansbacher, although he was not aware of that fact. Appendix XV (151) refers. 11. Mr Denis McCarthy Mr Denis McCarthy was the Managing Director, and then Chairman, of Odearest until his retirement in the early 1980s. He was also a long time non-executive director of Eagle Star insurance group, and was on the board of Beaumont Hospital. His interest in horse racing gave him the opportunity to be on the board of Leopardstown Racecourse, and to become the Senior Steward of the Turf Club. In the early 1970s Mr McCarthy met Mr Desmond Traynor at a dinner party. Sometime later, in 1973, Mr McCarthy decided to invest his share of the profit from the sale of a successful horse in an offshore account. He gave a cheque to Mr Traynor who arranged for the funds to be invested in a Guernsey company called Chunga Investments Limited. Although he does not remember signing any documents, he thought Mr Traynor mentioned a discretionary trust, and records provided by College Trustees show that, in December 1978, a discretionary trust known as The Garenne Trust was set up with College Trustees acting as trustees. Around 1981/82, Guinness and Mahon decided to redeposit much of the monies invested in Guernsey under the control of College Trustees, with GMCT / Ansbacher in the Cayman Islands. On 20 November 1981, the balance of US$25,092.26 held in an US dollar external call deposit account with Guinness and Mahon (ref: GMCT re. College B/G Account no. 32713/03/68) was transferred to Chunga Investments. The Inspectors infer that this transfer was an amount beneficially owned by Chunga which originated in a GMCT / Ansbacher account. Other payments by Ansbacher, possibly for fees and expenses, were made on behalf of Chunga to College Trustees through a Guinness and Mahon account entitled GMCT College Sundry Sub Co Account no. 6312 7 02 16 Appendix XV (152) refers. 12. Harold F Murray Mr Harold F Murray was the founder of the Murray group of companies which group has been involved in the car sale, rental and general motor trade in Ireland over many years. In 1974, the late Mr Murray caused to be established a trust based in Jersey called the Woodward Trust. The trust operated through Sumac Investments Ltd, a Jersey based company. College Trustees managed money sent to the Woodward Trust in 1974. For some time the funds were lodged in Guinness and Mahon in Dublin from Jersey but later, in or around 1981, these funds were channelled through Ansbacher under its then title of GMCT. This was done without reference to Mr Murray. Mr Harold T Murray (son of Harold F) gave evidence that, up to 1994 (when the money was withdrawn and declared for the tax amnesty), the funds of the trust were used to back loans to the group. Further, the money was at all times available to Mr Harold F Murray to be used as he thought fit. Appendix XV (153) refers. 13. Mr Brian Rhatigan Mr Brian Rhatigan is a former director of Rhatigan Holdings and Rhatigan Developments and is now a self-employed project management consultant. Both in his unsworn statement and in his sworn evidence, Mr Rhatigan denied any involvement with Ansbacher. When shown a document indicating that he had withdrawn funds for travellers cheques from an account in Guinness and Mahon entitled ‘GMCT re College Mr Rhatigan said he did not know what that account was, and repeatedly said he did not remember whether he had ever received travellers cheques from Guinness and Mahon. When shown other documents in which Guinness and Mahon loans given to himself and to companies controlled by him and a partner were described as ‘suitably secured’ Mr Rhatigan said that he was aware from the media what the term was supposed to mean, but that ‘other people might not agree with them’. The Inspectors are satisfied that Mr Rhatigan’s funds were initially on deposit with College Trustees in the Channel Islands. Together with other funds belonging to Irish residents, these were placed on deposit in Ansbacher’s bank in the Cayman Islands by College Trustees (often unknown to the clients), and formed part of an account held in Guinness and Mahon and entitled ‘GMCT re College Trustees Appendix XV (154) refers. 23.6 Category C: List of persons who were clients of Ansbacher through Mr Jack Stakelum 1. Mrs Margaret Clifford 2. Mr Thomas Clifford 3. Mr William Clifford - deceased 4. Ms Olga Gray 5. Mr Gerard Keane 6. Mr Austin C Murray 7. Mr William Quinn and Mrs Eileen Veronica Quinn - both deceased 8. Dr Tom Tiernan 9. Mr Patrick Tolan 23.7 Description of Category C clients 1. Mrs Margaret Clifford Mr William Clifford (deceased), formerly of The Spa Tralee, Co Kerry, had a business relationship with Jack Stakelum. Mr Clifford was a director of Princes Investments Limited, which had an adequately secured loan with Guinness and Mahon. The security used for this loan is not clear but Mr Clifford had money on deposit through Mr Stakelum between 1976 and the date of his death in 1981. Mr Clifford may not have been aware of the exact location of his deposits. Mr Clifford is on a list of clients relevant to this investigation supplied by Mr Stakelum following a requirement by the Inspectors. The list supplied by Mr Stakelum indicates that Mrs Clifford closed the account in 1987/8. The account therefore continued for some four years after Mr Clifford’s death. Mrs Clifford has dated the closing of the account as March 1994. Mrs Margaret Clifford was a client of Ansbacher from the date of her husband’s death in 1981 until 1994. Appendix XV (155) refers. 2. Mr Thomas Clifford Mr Thomas Clifford, of the Kerries, Tralee, Co. Kerry, had a business relationship with Jack Stakelum. Unfortunately, due to age and infirmity, Mr Clifford has been unable to assist the Inspectors. No blame is attached to Mr Clifford in respect of his unavailability. Mr Clifford was a director of Princes Investments Limited who had an adequately secured loan with Guinness and Mahon. He had money on deposit through Mr Stakelum between 1976 and 1987/8. Mr Clifford may not have been aware of the exact location of his deposits. Mr Clifford is on a list of clients relevant to this investigation supplied by Mr Stakelum following a requirement by the Inspectors. Appendix XV (156) refers. 3. Mr William Clifford, deceased The late Mr William Clifford, formerly of The Spa Tralee, Co Kerry, had a business relationship with Jack Stakelum. Mr Clifford was a director of Princes Investments Limited, which had an adequately secured loan with Guinness and Mahon. The security used for this loan is not clear but Mr Clifford had money on deposit through Mr Stakelum between 1976 and the date of his death in 1981. Mr Clifford may not have been aware of the exact location of his deposits Mr Clifford is on a list of clients relevant to this investigation supplied by Mr Stakelum following a requirement by the Inspectors. 4. Ms Olga Gray Ms Olga Gray of 9, Essen Road, Ormande 2091, Johannesburg, had a business relationship with Jack Stakelum. She gave money to Mr Stakelum in the mid 1980s and it remained under Mr Stakelum’s control until 1987/8. The money was given to Mr Stakelum to be put on deposit outside this jurisdiction Mr Stakelum carried out these instructions. Ms Gray may not have known where the money was deposited. Ms Gray is on a list of clients relevant to this investigation supplied by Mr Stakelum following a requirement by the Inspectors. Appendix XV (158) refers. 5. Mr Gerard Keane Mr Gerard Keane is the beneficial owner of Gerry Keane Limited, a wholesale and retail paint and wallpaper business in Dublin. He was a client of Jack Stakelum, to whom, from 1983/4 onwards, he gave monies to place on deposit for him. It was his understanding that Mr Stakelum would place the money on deposit in an undisclosed offshore account. Mr Keane did not know where the money was held. In 1988, Mr Stakelum sought advice from Mr Desmond Traynor of Guinness and Mahon who arranged on Mr Keane’s behalf to have a Channel Islands registered company called Beesley Properties Inc ( ‘B eesley) purchase a house at 54 Heytesbury Lane, Dublin. Mr Keane agreed that the money used by Beesley to fund the purchase came out of the monies he held on deposit through Mr Stakelum. Keane Initially the house was rented to Mr Beesley was the recipient of a lodgment in 1988 through an Ansbacher account in Guinness and Mahon described as Guinness Mahon Cayman Trust / College Sundry Sub Co account. In 1990, Mr Keane agreed to acquire the house from Beesley (which he effectively controlled) and borrowed the necessary funds from Allied Irish Finance. These funds were given to Killeen solicitors, who paid a cheque to Mr Traynor which was deposited by him in an Ansbacher account, no. 13154602, in IIB, as set out in his letter of 27 March 1990. In 1994, Mr Stakelum withdrew £100,000 of Mr Keane’s funds at his client’s request. Appendix XV (159) refers. 6. Mr Austin C Murray Mr Austin Celsus Murray is an architect. He and his wife Jean Murray are directors of the unlimited company Austin C Murray. The names of Austin and Jean Murray appear on a Guinness and Mahon list of loans described as ‘suitably secured’. This gave rise to the inference that they had money m an offshore account. The Inspectors are satisfied however, from information provided by both Mr and Mrs Murray, that Mrs Murray was unaware of the existence of any such account, and that she was not beneficially entitled to any funds it might contain. Mr Murray told the Inspectors that, to his knowledge, he never had monies in the Cayman Islands. He said that, in 1974, he placed money on deposit with Guinness and Mahon, and that this money was placed in an account in his name in the Channel Islands. At a later stage, Mr Jack Stakelum looked after these funds for him, and he understood that Mr Stakelum placed them in a collective account held by him. Mr Murray was unaware where that collective account was held. 7. Mr William Quinn and Mrs Eileen Veronica Quinn, both deceased Mr William Quinn, deceased, formerly of 15 Offington Park, Sutton, Dublin 13 had a business relationship with Mr Jack Stakelum. This commenced in the late 1970s and continued until Mr Quinn’s death in 1985. Money was given to Mr Stakelum to be invested outside the jurisdiction. Mr Stakelum carried out these instructions. Mr Quinn may not have known where the money was deposited. His wife, Mrs Eileen Veronica Quinn, now also deceased, continued the account after his death. Mr Quinn is on a list of clients relevant to this investigation supplied by Mr Stakelum following a requirement by the Inspectors. Appendix XV (161) refers. 8. Dr Tom Tiernan Dr Tom Tiernan of 529 Howth Road, Raheny, Dublin 5 was a client of Jack Stakelum, to whom, during the period 1976 to 1980, he gave monies to place on deposit. He had no knowledge of where the deposits were held or any contact with any financial institution. He made no withdrawals until Mr Stakelum advised him that he was retiring when the balance on his account was transferred elsewhere. Dr Tiernan is on a list of clients, relevant to this investigation, supplied by Mr Stakelum following a requirement by the Inspectors. Appendix XV (162) refers. 9. Mr Patrick Tolan Mr Patrick Tolan is resident at 40, Elkwood, Rathfarnham, Dublin 14. He was a client of Mr Jack Stakelum to whom, during the period 1983 to 1988, Mr Tolan gave untaxed income of which he was in receipt. His understanding was that Mr Stakelum would place the money on deposit in an undisclosed account, which also held the monies of other persons. Mr Tolan did not know where the money was held. Appendix XV (163) refers. 23.8 Category D: List of persons whose sole involvement was the establishment of Ansbacher trusts to which they never transferred any assets 1. Mr Neil McCann 2. Mr Philip Monahan 3. Mr Alex Spain 23.9 Description of Category D clients 1. Mr Neil McCann Mr Neil McCann is a director of Fyffes pic. In the mid-1950s, he took over the family company, which was then known as Charles McCann Limited. In 1968, a new company was incorporated - Fruit Importers of Ireland Limited in which Mr McCann was a majority shareholder, holding about 60% of the shares. The rest of the shares were divided among a number of people. Fruit Importers of Ireland Limited ceased trading in 1980. Its trade and assets were transferred to a new and previously unconnected company, FIT pic, which in 1986 purchased Fyffes, and subsequently changed its name to Fyffes pic. A copy letter from Mr McCann to GMCT refers to a Deed of Settlement dated 3 March 1972, by which John Andrew Furze appointed GMCT as Trustees of a settlement for the benefit of the issue of the late Charles McCann and Rosetta McCann. The letter states that in its capacity as Trustee of the said settlement, GMCT, through its nominees, owned the entire issued share capital of a company called Blue Limited. Mr McCann told the Inspectors that he had no such trust, and had no recollection of ever having seen the letter until it was furnished to him recently by SKC, his financial advisers. In the letter, Mr McCann goes on to authorise GMCT to transfer the entire issued share capital of Blue Limited to a third party However, a letter dated 28 December 1972, from Mr Furze to Mr McCann confirms the existence of a trust, established on 31 March 1972, of which John Furze is settlor and GMCT is trustee. It states that Mr McCann is a member of the appointed class, and that the settlor has requested that the trust funds be held primarily for the benefit of Mr McCann himself and his wife and family. The settlor has further requested that the trustee make no distribution without taking the advice of Mr McCann. A second letter, dated 5 January 1973, is addressed to Mr Vincent Walsh of Arthur Cox from Mr Alex Spain. The letter (which is copied to Mr McCann) refers to three Cayman trusts, called the Red, White and Blue Trusts, which were established ‘early in 1972’. It is clear from the fact that the letter was copied to Mr McCann that he still had an involvement with the Blue Trust at that time. Mr McCann is adamant that, whatever the intended purpose of such a trust, no assets were ever transferred to it. A letter dated 11 May 2000, from Mr Sean Mooney of KPMG, supports his assertion. The Inspectors accept Mr McCann’s evidence in this regard. However, it is clear from what has been said above that Mr McCann arranged for or permitted the establishment of the Blue trust. It was so established on his behalf by GMCT, and the Inspectors are satisfied that this constituted the carrying out of business for him by GMCT. Mr McCann was a client of Ansbacher only to the extent that it carried out business on his behalf by establishing a trust, to which, however, no assets were ever transferred. Appendix XV (164) refers. 2. Mr Philip Monahan Mr Philip Monahan resides at Somerton, Porterstown Road, Castleknock, Dublin 15. He is a property developer, and is a shareholder in and director of a number of companies. A letter dated 5 January 1973 from Mr Alex Spain to Mr Vincent Walsh of Arthur Cox, and copied to Mr Monahan, refers to three Cayman trusts, called the Red, White and Blue trusts, which were established ‘early in 1972’. Mr Spain explains that he is enclosing a letter from John Furze of GMCT about the trust, of which he, Mr Spain is a potential beneficiary, and he adds that identical letters have been sent to Mr Monahan and to Mr Neil McCann. This gives rise to an inference that Mr Monahan must also have been a potential beneficiary of one of the trusts. As the letter indicates that the Red Trust was that of which Mr Spain was a potential beneficiary, and as other information in the Inspectors’ possession indicates that the Blue trust was Mr McCann’s, the Inspectors believe that the White trust was that of Mr Monahan. The letter tells the recipient that any profits arising from two named companies should flow into the trusts In reply to a letter from the Inspectors enquiring in general terms as to any information Mr Monahan might have about Ansbacher, his solicitors said that he had ‘no details and/or recollection pertaining to any o f the matters ’ set out in the Inspectors’ letter. However, the Inspectors subsequently furnished Mr Monahan with a copy of the letter of 5 January 1973, and in response, by letter dated 7 November 2001 his solicitors, Noel Smyth and Partners, stated that Mr Monahan recollected that the Red White and Blue trusts were set up in respect of a venture which did not proceed, and that he understands that no money was transferred to them, and that he received no benefits therefrom. The Inspectors accept this as true. However, it is clear from what has been said at paragraph 2 above that Mr Monahan arranged for or permitted the establishment of the White trust. It was so established on his behalf by GMCT, and the Inspectors are satisfied that this constituted the carrying out of business for him by GMCT. Appendix XV (165) refers. 3. Mr Alex Spain Mr Alex Spain, of 46 Upper Mount Street, Dublin, is a former partner in KPMG. A letter dated 5 January 1973 from Mr Spain to Mr Vincent Walsh of Arthur Cox refers to three Cayman trusts, called the Red, White and Blue trusts, which were established ‘early in 1972’. Mr Spain explains in the letter that he is enclosing a letter from John Furze of GMCT about the trust, of which he, Mr Spain, is a potential beneficiary. The letter tells the recipient that any profits arising from two named companies should flow into the trusts. In a letter to the Inspectors, Mr Spain said that the Red trust was set up in connection with his interest in a property development, but that it was never activated and that no assets flowed into it at any time. It is clear from the foregoing that Mr Spain arranged for the establishment of the Red trust. It was so established on his behalf by GMCT, and the Inspectors are satisfied that this constituted the carrying out of business for him by GMCT. Appendix XV (166) refers. 23.10 Category E: List of persons for whom Ansbacher conducted business other than the holding of funds This category comprises three sub-categories as follows: 23.11 Category E(i): List of persons to whom Ansbacher provided a service or loans in the ordinary course of business 1. Mr Vincent Ferguson 2. Mr James McCarthy 3. Celtic Helicopters 4. Colm McLoughlin 23.12 Description of Category E(i) clients 1. Mr Vincent Ferguson Mr Vincent Ferguson is a former director of Fitzwilton pic and Atlantic Resources Limited. Through Mr Desmond Traynor, he obtained a number of loans from Ansbacher. Appendix XV (167) refers. 2. Mr James McCarthy Mr James McCarthy is a former Chief Executive of Dockrell’s and former member of the Board of Fitzwilton pic, Independent Newspapers and Atlantic Resources pic. Around 1997 he became an executive director of Arcon Limited, which was a subsidiary of Atlantic Resources. He has now retired from business. Evidence shows that cheques drawn by Mr McCarthy were lodged to an account in the name of Kentford Securities Limited (see paragraph 3 below). This company, which had an account in Bank of Ireland, was widely used by Mr Desmond Traynor for the purpose of making lodgments to and withdrawals from Ansbacher accounts in Guinness and Mahon and HB. Mr McCarthy, who gave evidence on oath to the Inspectors, categorically denied that he had any dealings with Ansbacher other than that about to be outlined. In 1983-84, Mr McCarthy and two other persons who were shareholders in and board members of Atlantic Resources pic, wished to obtain finance for the purchase of shares in that company. They approached Mr Traynor, who agreed to arrange the matter. At first Mr McCarthy assumed that the finance would be provided by Guinness and Mahon, but in fact Mr Traynor arranged that it should be provided by GMCT. He set up a structure whereby the loan would be granted to a GMCT nominee company, Medford Investments Limited, which company would also purchase the shares. In 1986, GMCT provided Mr McCarthy with a similar service in respect of the purchase of shares in Fitzwilton pic, and in respect of the purchase of further shares in Atlantic. Another GMCT Nominee company, Ascot Holdings Limited, was on this occasion the entity to which the loan was granted, and which purchased the shares. Mr McCarthy explains the payments into Kentford by stating that they were cheques he gave Mr Traynor as repayments of his loans from the Company. Some of these cheques were made out to ‘Cash’. He explains this by stating that those cheques were given to Mr Traynor after Mr Traynor’s departure from Guinness and Mahon, and that Mr Traynor probably told him to make the cheques payable to cash. The Inspectors accept Mr McCarthy’s explanation, and are satisfied that it was Mr Traynor himself, not Mr McCarthy, who lodged the cheques in Kentford Securities’ account, and that he did so in order to transfer the payments to Ansbacher. Appendix XV (168) refers. 3. Celtic Helicopters Limited Celtic Helicopters Limited is a Dublin company that provides helicopter services. Its directors are Mr Ciaran Haughey and Mr John Terrance Barnicle. In 1991, Celtic Helicopters obtained a loan from IIB secured upon a cash deposit placed with IIB by Ansbacher. In 1992, IIB provided Celtic Helicopters with a guarantee for a loan from Bank of Ireland. IIB’s guarantee was secured by a further guarantee and cash deposit from Ansbacher. In 1993, IIB provided Celtic Helicopters with a guarantee in respect of a lease contract with Jet Aviation. On this occasion, HB’s guarantee was secured by a guarantee and cash deposit from Hamilton Ross. In 1992, funds debited to an Ansbacher account in IIB were lodged to an account in the name of Celtic Helicopters in Bank of Ireland, and used to repay its loan from IIB. There is no evidence whatsoever to suggest that Celtic Helicopters was the beneficial owner of the Ansbacher or Hamilton Ross funds used to back the loans described above, or of any funds on deposit with either Ansbacher or Hamilton Ross. On the contrary, the evidence given on behalf of the company is that it never had funds on deposit with Ansbacher, and indeed that the directors were unaware of the existence of the cashbacked security. However, it is clear that Ansbacher carried out business for Celtic Helicopters by providing the services described above, from which Celtic Helicopters clearly benefited, and to that extent, Celtic Helicopters was a client. Appendix XV (11) refers. 4. Mr Colin McLoughlin Mr Colm McLoughlin is a resident of Dubai, United Arab Emirates, and was so resident at all relevant times. Mr McLoughlin’s business affairs in Ireland were handled, in the present context, by his brother, Mr Ray McLoughlin. In the early 1980s, a company called Selima Investments Limited, with an address 'c o Guinness Mahon Cayman Trust ’ borrowed money from Guinness and Mahon. Its loan account number was 07318006. Security for the loan included shares in James Crean Limited. On 11 September 1984, the name on loan account number 07318006 was changed to Montoire Limited (a Channel Islands company) and Selima Investments Limited was so advised on 17 September. The name ‘Montoire’ had already appeared on documents relating to the Selima loan, on one occasion appearing in brackets after the name ‘Selima’. As Selima Investments was a GMCT company, it was necessary for the Inspectors to identify its beneficial owner, as that person was clearly a client of Ansbacher On 1 October 1984, an internal Guinness and Mahon memorandum notes that it had been agreed that Mr Ray McLoughlin would guarantee the aforementioned loan, but that he had indicated that he wished to give the matter further consideration, as there was a ‘distinct possibility he might repay the loan in the near future. ’ A further memo of the 18 October and a file note of 14 December note that Mr McLoughlin still had not provided the guarantee. A memo of 26 March 1985 notes that the name of the account had again been changed, this time to a company called Dewdrop Investments Limited, another Channel Islands company. Security for the loan continued to include, inter alia, the shares in James Crean Limited already mentioned. A copy of a facility letter to Dewdrop Investments Limited dated 28 May 1985 bears on its face the handwritten annotation ‘Switch from Montoire packet ’ indicating that the Dewdrop loan was in all respects the same loan previously held by Montoire. Mr Ray McLoughlin gave evidence on oath to the Inspectors, the gist of which was that his brother Colm McLoughlin was the principal of Selima Investments Limited. According to Mr McLoughlin, Colm wished to borrow money from Guinness and Mahon to purchase shares in James Crean Limited, and Guinness and Mahon furnished him with a GMCT company, Selima, for this purpose. Mr McLoughlin gave evidence that he was the principal negotiator with Guinness and Mahon on behalf of his brother Colm, and he put forward this fact as the explanation for the proposal in the documentation that he should furnish a guarantee, although he added that he did not recollect being asked for such a guarantee. Asked about the Guinness and Mahon memo of 1 October 1984, which refers to the possibility that he will repay the loan, Mr McLoughlin gave evidence that he did not know what it meant, and suggested that it might be inaccurate. Mr McLoughlin also stated that in 1985 Colm decided to use a Channel Islands company instead of a Cayman company, and Dewdrop Investments Limited was provided to him in consequence. Mr Ray McLoughlin denied that he himself had any interest in Dewdrop Investments Limited. On 4 September 1985, Guinness and Mahon sent detailed information on the Dewdrop loan to Mr Paddy Meagher, an employee of James Crean Limited. Mr Ray McLoughlin has told the Inspectors that Mr Meagher was an accountant employed in an administrative capacity by James Crean Limited. He assisted Mr Ray McLoughlin with various matters from time to time. Asked why Guinness and Mahon would communicate with Mr Meagher about Dewdrop Limited, Mr McLoughlin said that he would communicate with Colm about these matters and ‘that led to this communication with Paddy M eagher’. Mr McLoughlin went on to say ‘ ... on an issue relating to the loan I would have dialogued with Colm. I f that involved talking with the administration people in Guinness Mahon about a thing like currency, I would have asked Paddy, probably, to help me with that because I was too busy. That is what, I think, this means, but again, I repeat, I actually do not recall all that. ’ On 14 January 1986, Mr Ray McLoughlin wrote to Guinness and Mahon about arranging a borrowing for ‘his brother’. In an attached memo, he sets out relevant information. This includes an item stating that ‘his brother’s’ present borrowing amounts to £160,000. This figure equates roughly to the amount borrowed by Dewdrop Investments Ltd, not being the original borrowing but an additional borrowing arising out of a rights issue based on the Crean shares originally purchased. Up to that moment, no reference to Mr Ray McLoughlin’s brother had been made in any of the documentation. Finally, a Guinness and Mahon file note dated 15 January 1986 and signed ‘M C K ’ (the initials of Mr Martin Keane) is headed ‘Ray McLoughlin ( ‘R. McL ’) / James Crean pic ( ‘Crean ’). This note begins: ‘A t the present time our involvement with the above is as follows and it goes on to set out (inter alia) the balance on the Dewdrop loan account. Mr Ray McLoughlin, when asked about this memo, stated that his name was on it because of his brother’s connection to him. The Inspectors had some doubts whether the beneficial owner of Selima was Colm McLoughlin or his brother Ray McLoughlin. Subsequently, Mr Colm McLoughlin furnished the Inspectors with an affidavit stating that he was the beneficial owner of Selima, and that the borrowings referred to above were at all times for his benefit. Mr Maurice O’Kelly and Mr Martin Keane of Guinness and Mahon gave evidence on oath that they believed Mr Colm McLoughlin to be the beneficial owner of Selima. The Inspectors accept that evidence. Appendix XV (79) refers. 23.13 Category E(ii): List of persons provided with an Ansbacher company for the purpose of purchasing property 1. Ms Barbara Breen 23.14 Description of Category E(ii) clients 1. Ms Barbara Breen Ms Barbara Breen is the Managing Director of Merops Nutrition and Windsor Nutrition, and is a director of and shareholder in Windsor Foods Ltd and Windsor Nutrition Ltd. These companies were all owned by the late Mr Thomas McLaughlin, a close friend of Ms Breen. In the 1980s, Ms Breen used a Cayman Island company, Coral Reef Securities Limited (‘Coral R eef), to buy a property in Portugal. Fees in respect of this company were invoiced by Ansbacher, under its earlier names of Cayman International Bank and Trust Company Limited and Ansbacher Limited. In the early 1980s, Mr McLaughlin gave funds to Mr Desmond Traynor to place on deposit. Mr Traynor deposited them with Ansbacher. Ms Breen understood that these funds were to be placed at her disposal in the event of Mr McLaughlin’s death. She withdrew money from the funds from time to time but only with the consent of Mr McLaughlin whom she considered to be the real owner of the funds. In or about 1998, Mr McLaughlin repatriated the money and lodged it to an account in his own name in an Irish bank. The Inspectors are satisfied that Ms Breen was not the beneficial owner of the funds placed on deposit with Ansbacher by Mr Thomas McLaughlin. Ms Barbara Breen was a client of Ansbacher only to the extent that Ansbacher managed Coral Reef Securities Limited, a company that purchased and held a property on her behalf. Appendix XV (169) refers. 23.15 Category E(iii): List of persons who owned Ansbacher-managed companies which were potential beneficiaries of the Lynbrette Trust 1. Mr Francis Boland 2. Mr Patrick J Dineen 23.16 Description of Category E(iii) clients 1. Mr Francis Boland Mr Francis Boland is currently chairman of the Port of Cork Company Ltd. Evidence supplied by Guinness and Mahon showed that on 19 November 1980, Barclay’s Bank International in Manchester transferred $50,000 to an account in the name of Guinness Mahon & Co (the London company) in Bankers Trust Company, New York, for further transmission to a GMCT seven-day deposit account. Guinness and Mahon says that Mr Boland requested this transfer. Mr Boland gave evidence that he formed part of a consortium to carry out a development near Phoenix, Arizona, USA. Upon the advice of Mr Desmond Traynor, a scheme was constructed involving the establishment of a discretionary trust, the Lynbrette Trust, of which GMCT was the Trustee. The Trust had as beneficiaries five Cayman companies, representing the interests of the five Irish participants. Mr Boland told the Inspectors that Medford Investments Limited was the name of the company that represented his interest in the Trust. Mr Boland was unable to recollect the transaction referred to above, but he explained that his personal contribution towards the development amounted to $212,000, which he paid in three or four tranches and he presumes that the transaction in question must have been the payment of the first tranche. The Inspectors accept that this is the most likely explanation, given a similar transaction on the part of another participant in the development at the same time. The development was unsuccessful and all participants lost their investments. Mr Boland was a client of Ansbacher to the extent only that he was the beneficial owner of a company (Medford Investments), which was a potential beneficiary of a trust of which Ansbacher was trustee. Appendix XV (170) refers. 2. Mr Patrick J Dineen Mr Patrick Dineen, of Temple Lawn House, Blackrock Road, Cork, is a businessman and company director. He has been a professional non-executive director who has served on the boards of many well-known Irish companies. In May 1981, Mr Dineen, together with seven others, formed a consortium to develop a property in the US. The consortium caused a discretionary trust, the Lynbrette Trust, to be established, of which GMCT was the trustee. The trust had as beneficiaries five Cayman companies, representing the interests of the five Irish members of the consortium. Mr Dineen was uncertain as to the name of the company representing his interest, but information available to the Inspectors suggests it was Overseas Nominees Ltd. Mr Dineen invested monies in the Lynbrette Trust, which also borrowed funds from AIB in New York. The development was unsuccessful and failed financially and the Irish members of the consortium had their guarantees called by AIB. The Inspectors conclude that Mr Patrick Dineen was a client of Ansbacher to the extent only that he was beneficially entitled to the interest held by Overseas Nominees in the Lynbrette Trust. Appendix XV (171) refers. PART VI RELATED MATTERS 432 Introduction to Part VI The High Court Order of 22 September 1999 directed the Inspectors at paragraph (e) to ‘report on any related m atter’. The Inspectors do so in this section of the report. They have deemed that there are four such related matters: (a) the operation and wrongdoing of the Cayman Islands company known as Hamilton Ross Company Limited, (b) the role of the Central Bank, (c) the matter of exchange control and (d) the role of the auditors of Guinness and Mahon during the period when Ansbacher held accounts with that bank. In this chapter also, the Inspectors name those persons who, in one way or another, failed to co-operate with their enquiry, and make a recommendation to the High Court in that regard. HAMILTON ROSS COMPANY LIMITED (1992 TO EARLY 1997) INDEX Page Introduction 436 Hamilton Ross’s opposition to the Inspectors investigations 436 Ownership and control of Hamilton Ross 437 Mr Traynor as beneficial owner from 1992 437 The involvement of Hamilton Ross in Ansbacher’s Irish business 438 Removal of Hamilton Ross from the books of Ansbacher 438 Hamilton Ross opens accounts in IIB 439 Ansbacher notepaper used for Hamilton Ross business 440 Ansbacher clients become clients of Hamilton Ross 440 Hamilton Ross statements printed on Ansbacher paper until 1993 440 Hamilton Ross uses Ansbacher’s Cayman address 440 434 Page 24.12 Hamilton Ross operation identical to that of Ansbacher 441 24.13 Lodgements 441 24.14 Withdrawals 441 24.15 Hamilton Ross at 8-10 Inns Court 442 24.16 Responsibility of individuals 442 24.17 Wrongdoing of Hamilton Ross (1992 to early 1997) 443 24.18 Conducting its affairs with intent to defraud a creditor of some of its clients 444 24.19 General criminal offences. 444 24.20 Breaches of the Companies Acts 445 24.21 Unlicensed banking 446 24.22 Breaches of the taxation code by Hamilton Ross 448 HAMILTON ROSS COMPANY LIMITED 24.1 Introduction Hamilton Ross Company Limited (‘Hamilton Ross’), as shown earlier, was originally a company used by Ansbacher to hold the funds of some of Ansbacher’s Irish clients. The Inspectors consider its operation and wrongdoing to be a ‘related matter’ within the terms of the High Court Order for a number of reasons. Firstly, there is evidence tending to show that when Ansbacher’s London management insisted upon the removal of Hamilton Ross from the books of Ansbacher, Hamilton Ross set up business in Ireland as a bank, operating without the licence required by the Central Bank. In that capacity, it held funds belonging to a number of former clients of Ansbacher. Secondly, the signatories on the Hamilton Ross accounts were Mr Furze (who was stated to be a director) and three authorised signatories: Mr Traynor, Mr Collery and Ms Williams. Of these four people, Mr Traynor was the chairman of Ansbacher, Mr Furze was an executive director of Ansbacher, Mr Collery controlled the memorandum accounts and Ms Williams was Mr Traynor’s secretary (although of course not by any means exclusively in relation to his Ansbacher work). Thirdly, instructions in relation to the Hamilton Ross accounts in IIB were initially issued on Ansbacher headed paper. Even when that practice changed, the notepaper used was identical with the Ansbacher notepaper in every respect except the name of the company. The Cayman postal address was that of Ansbacher. The telephone, telex and fax numbers were Ansbacher’s. 24.2 Hamilton Ross’s opposition to the Inspectors investigations The Inspectors, pursuant to their duty to report on the affairs of Ansbacher and identify its clients, sought the assistance of Ansbacher itself. In due course, that company made an application to The Grand Court of the Cayman Islands seeking permission to disclose certain limited information to the Inspectors. Hamilton Ross as a notice party opposed this application and an affidavit was filed as to the nature of their objections (see Appendix XVI(a)). From these documents, it is clear that Hamilton Ross felt unable to co-operate with the Inspectors. In common with other affected parties, Hamilton Ross was notified of the essential elements of the Inspectors’ conclusions and made representations arising therefrom, which have been taken into account by the Inspectors. 24.3 Ownership and control of Hamilton Ross Hamilton Ross, its functions and its appearance on the Irish scene are described in Chapter 2. Dramatic changes took place in mid September 1992 as a result of executive action by Henry Ansbacher in London. The details of these events are related elsewhere in this report, but, as a result, control of Hamilton Ross left Ansbacher and rested with Mr John Furze and/or Mr Desmond Traynor. It is difficult to delimit the role of Mr Furze as he was a director of Hamilton Ross at all times, originally as a GMCT and Ansbacher executive, later as principal or agent of Mr Desmond Traynor. After Mr Traynor’s death, Mr Furze acquired Hamilton Ross, possibly as beneficial owner. Of particular importance to the Inspectors is the ownership between September 1992 and Mr Traynor’s death on 11 May 1994. September 1992 is significant as at that time certain Ansbacher accounts in IIB were closed and the funds (bearing the same codes) were transferred to new accounts opened in the name of Hamilton Ross. The documents opening Hamilton Ross accounts in IIB in September 1992 describe Mr Furze as a director, with Mr Traynor, Mr Padraig Collery and Ms Joan Williams as authorised signatories. This would suggest that Mr Furze was the new beneficial owner but the question arises as to whether he was acting on his own behalf or as an agent of another. 24.4 Mr Traynor as beneficial owner from 1992 Events which occurred on 5 May 1993 answered this question. Through the agency of Mr John Furze, a trust known as the Poinciana Trust was established with Mr Desmond Traynor as the moving party. The third member of the group that ran GMCT/Ansbacher for over 20 years, Mr John Collins, is named as the Protector in the deed. The beneficiaries are stated to be Mr Desmond Traynor and his wife in the first place and his wider family secondly. The trust deed contains a schedule setting out the assets of the trust. These include the issued shares and other capital of four companies, Poinciana Fund Limited, Hamilton Ross Limited, Worldwide Management and Consultancy Services Limited and Dumas Holdings Limited (see Appendix XVT(b)). The conclusion is clear - Mr Traynor was the beneficial owner of Hamilton Ross from the time of the de-merger of the Ansbacher accounts in 1992 to his death. Following Mr Traynor’s death, Mr Furze disposed of Hamilton Ross in his capacity as trustee of Poinciana Trust. This information is contained in a letter dated 22 June 2001 from Barry B Benjamin (the new trustee of the Poinciana Trust) to Mr Tony Traynor, son of Mr Desmond Traynor. (see Appendix XVT(c)). The date of the disposal and the price paid (if any) are unknown. The Traynor family have assured the Inspectors that they do not have this information. If the lack of knowledge of the Traynor family is genuine (a fact not disputed by the Inspectors), the secret nature of this transaction is a lesson to those who entrust their wealth to offshore trusts. 24.5 The involvement of Hamilton Ross in Ansbacher’s Irish business Hamilton Ross’s involvement in Ansbacher’s Irish business began in 1988, when it appeared on the books of Ansbacher as the company holding the funds in Cayman of some of the smaller Irish sterling depositors. Up to September 1992, the use made of Hamilton Ross was no different to that made of other Cayman companies within the Ansbacher scheme, apart from the fact that the Hamilton Ross system was an amalgamation of many individuals’ investments. Ansbacher, through Hamilton Ross, was providing offshore banking for the small investor through the ingenuity of Mr Traynor and Mr Furze. Within Ireland, Hamilton Ross had thus far done no wrong. 24.6 Removal of Hamilton Ross from the books of Ansbacher However, the use made of Hamilton Ross, both within and outside Ireland, changed dramatically towards the end of 1992. The background and details of the change at that time is set out elsewhere in this report. A brief summary will suffice here so as to put the part played by Hamilton Ross into context. On 16 September 1992, two senior employees of Henry Ansbacher, Messrs Jennings and McAuliffe, sent a fax to Mr Richard Fenhalls, the chief executive of Henry Ansbacher, from Cayman where they had been seconded in circumstances outlined in Chapter 12. They had discovered the use that was being made of Hamilton Ross in Cayman, and were seriously alarmed. According to the fax, they feared that it could lay Ansbacher open to charges of: • ‘Carrying out a deposit taking activity in Eire without a licence. • Trading within Eire without declaring this to the Revenue. • Possible breach o f Eire Exchange Control • Assisting Eire residents to avoid Eire tax. • Failure to comply with the Money laundering regulations. • Possible risk o f error on money transfer between the clients and AL [Ansbacher Limited], • Risks associated with the absence o f dual controls ’ (see Appendix XVI(d)). Mr Fenhalls took action to bring this dangerous situation to an end. He issued instructions that all Hamilton Ross accounts were to be removed from the books of Ansbacher by 30 September 1992. 24.7 Hamilton Ross opens accounts in IIB Back in Ireland, Mr Traynor responded to the new situation by taking steps to ensure that some of the memorandum accounts and other business considered to be of a similar type were taken off the books of Ansbacher in Ireland. He gave instructions to IIB to close certain accounts that had been held in the name of Ansbacher, and to transfer the funds to new accounts which were opened in the name of Hamilton Ross. This was the first appearance of that company on the Irish scene. The accounts were opened on foot of a resolution of the board of Hamilton Ross and were non-resident accounts. Only part of the main pooled account was transferred. The signatories on the Hamilton Ross accounts were to be Mr Furze (who was stated to be a director) and three authorised signatories Mr Traynor, Mr Collery and Ms Williams. These are exhibited in Appendix XVI(d). 24.8 Ansbacher notepaper used for Hamilton Ross business Instructions to IIB were issued on Ansbacher notepaper bearing an Irish address for correspondence. Examples of the type of instructions issued appear in Appendix XVI(e). Ansbacher notepaper continued to be used to give instructions to Irish banks on the new Hamilton Ross accounts after September 1992. In general, Hamilton Ross notepaper was used after mid November. A later letter on Ansbacher notepaper dated 3 December 1992 is exhibited in Appendix XVI(f), but this was the exception rather than the rule and may have been a clerical error. 24.9 Ansbacher clients become clients of Hamilton Ross The cumulative effect of the removal of Hamilton Ross from the Cayman books, the opening of the Hamilton Ross accounts in IIB, and the transfer to them of Ansbacher funds was that those clients whose funds which had been held in a pooled account in Ansbacher’s name in IIB, and in a pooled account in the name of Hamilton Ross on the books of Ansbacher in Cayman, now ceased to be held in any Ansbacher account either in Ireland or in Cayman. Instead, they were held on the clients’ behalf in IIB in an account in the name of Hamilton Ross. Thus, those persons who had hitherto been clients of Ansbacher became clients of Hamilton Ross. 24.10 Hamilton Ross statements printed on Ansbacher paper until 1993 Statements of the Hamilton Ross memorandum accounts continued to be printed on Ansbacher headed paper until January 1993, but Mr Collery has explained to the Inspectors that this was simply because he was using up available stationery until new stationery was printed. Mr Collery is clear on one vital point, namely, that from 30 September 1992, these statements were no longer sent for reconciliation to Ansbacher; instead, they were sent to Hamilton Ross at its Cayman address. 24.11 Hamilton Ross uses Ansbacher’s Cayman address On 19 November 1992, new stationary made its debut in 42 Fitzwilliam Square. In addition to the previous Ansbacher paper, Hamilton Ross paper was made available, which would be used for Hamilton Ross business from that time on. The paper itself is interesting, as it fundamentally contradicts the assertion of Henry Ansbacher’s management that, after September 1992, Ansbacher no longer managed Hamilton Ross. The notepaper is identical with the Ansbacher notepaper except for the name. The Cayman postal address is that of Ansbacher. The telephone, telex and fax numbers are Ansbacher’s. The way in which the Irish address at 42 Fitzwilliam Square is superimposed is identical. Hamilton Ross continued to use this notepaper, unchanged, until at least December 1994. Examples of this notepaper are exhibited at Appendix XVI(g). 24.12 Hamilton Ross operation identical to that of Ansbacher After the transfer of some of the Ansbacher funds to Hamilton Ross, no change in the range, scope or intensity of the operation is obvious. Letters continued to be issued under the names of one of the three Irish authorised signatories. Ms Williams signed most of the letters, but from her evidence and the references contained therein it is clear that Mr Traynor continued to manage the operation. The system, as operated for Hamilton Ross clients, involved a cash lodgement and withdrawal system in Ireland in respect of money notionally held by these persons in Grand Cayman. 24.13 Lodgements Hamilton Ross accepted lodgements in Ireland for and on behalf of Irish residents. Lodgements when they were made were rarely sent directly from Hamilton Ross to IIB but were transferred through an Amiens type account and a sterling account in Scotland. This was necessary as the memorandum accounts were denominated in sterling at all times. Lodgements were directly made, however, on some occasions. One such example can be found at Appendix XVI(h). 24.14 Withdrawals There are many examples in the records made available to the Inspectors of withdrawals by Hamilton Ross of the type previously done in the name of Ansbacher: see letter 4 January 1993 seeking IR£20,000 for B.E.L. Secretarial Services, letter dated 18 February 1993 seeking IR£50 payable to Kentford Securities Ltd and letter 15 March 1993 seeking a cheque for IR£10,000 payable to Bank of Ireland. exhibited at Appendix XVI(i). Copies of these documents are Kentford Securities Ltd account in the Bank of Ireland continued to be used as a cash facility for withdrawals as IIB did not have a cash service. 24.15 Hamilton Ross at 8-10 Inns Court After the death of Mr Traynor in May 1994, Hamilton Ross continued to operate from 42 Fitzwilliam Square. It later moved to 8-10 Inns Court Winetavern Street Dublin 8, the premises of Mr Sam Field-Corbett, a long-time associate of Mr Traynor. The transfer was organised by Mr Padraig Collery who recognised that the Hamilton Ross business could not be run indefinitely from CRH offices after Mr Traynor’s demise. The transfer took place in and about November 1994 even though Hamilton Ross letters were still issuing from 42 Fitzwilliam Square up to December 1994. Once the transfer had taken place, the day-to-day work appears to have been done by Mr Field-Corbett. It is outside the scope of this section of the report to consider in detail the roles played by Ms Williams, Mr Collery and/or Mr Field Corbett at the various dates relating to Hamilton Ross. These matters are considered under the appropriate section dealing with the role of each of these persons. 24.16 Responsibility of individuals During the lifetime of Mr Traynor, all executive decisions were taken by him or under his authority. Mr Traynor controlled all aspects of Hamilton Ross’s Irish operation. As a result Mr Traynor, if alive, would have to accept responsibility for any breach by Hamilton Ross of its duties under Irish law. Ms Joan Williams and Mr Padraig Collery assisted Mr Traynor but had no overall executive responsibility for the business up to the date of his death. It is obvious from the correspondence that Mr Collery had greater authority than Ms Williams at this stage. After the death of Mr Traynor, the executive functions previously exercised by him were divided between Mr John Furze and Mr Padraig Collery. In playing a major role in the continuation of the business, Mr Collery must share with Mr Furze responsibility for any breach by the Company of its legal duties in this jurisdiction for periods after the death of Mr Traynor. Mr Field-Corbett does not appear to have had executive responsibility for the actions taken by him. His actions appear to have been taken under the control of Mr Furze and Mr Collery. Mr Field-Corbett was responsible for assisting the enterprise by the provision of premises. 24.17 Wrongdoing of Hamilton Ross (1992 to early 1997) As appears from the Order appointing the Inspectors of 22 September 1999, the Inspectors are required, inter alia: ‘to examine whether the Companies Acts 1963-1990 were breached by the Company... and i f so to identify the provisions involved.... ’ (see sub-paragraph (c) o f the Order) and ‘to examine whether the affairs o f the Company were conducted with intent to defraud its creditors or the creditors o f any other person or otherwise fo r fraudulent or unlawful purpose and i f so to identify the statutory provisions involved.... ’ (see sub-paragraph (d) o f the Order). The Inspectors have formed the view that they should apply the Order of the High Court, mutatis mutandi, to the related matter of Hamilton Ross. The Inspectors therefore considered it relevant to consider whether, during the period in which it carried on business in Ireland (i.e., between 1992 and early 1997) the affairs of Hamilton Ross were conducted with intent to defraud creditors of some of its clients, whether Hamilton Ross was guilty of carrying on an unlicensed banking business, whether Hamilton Ross was in breach of Part XI of the Companies Act, 1963 and whether Hamilton Ross can be said to have breached the taxation acts. The Inspectors are satisfied that the present management of Hamilton Ross was not in situ during the relevant time. 24.18 Conducting its affairs with intent to defraud a creditor of some of its clients As has been set out in previous chapters of this Report, the Inspectors are satisfied that there is evidence tending to show that, in the course of conducting its Irish business, Ansbacher provided a range of services to clients which was calculated to facilitate those clients in the evasion of their taxation liabilities. This conclusion also applies to Hamilton Ross, which took over part of the Ansbacher Irish business in 1992. The Inspectors are satisfied that the clients of Hamilton Ross availed of Hamilton Ross’s services for that purpose and did so with the knowledge of Hamilton Ross. So far therefore as sub-paragraph (d) of the Order is concerned the Inspectors are satisfied therefore that there is evidence tending to show that the affairs of Hamilton Ross were conducted with intent to defraud creditors (namely the Revenue Commissioners) of some of its clients. 24.19 General criminal offences. The above conclusion leads the Inspectors to conclude further that there is evidence tending to show that Hamilton Ross may have been guilty of a number of criminal offences including: (a) The common law offence of conspiracy to defraud which is an offence punishable by a fine or imprisonment; and (b) The offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver, knowingly or wilfully, any incorrect return, statements or accounts in connection with their tax contrary to the provisions of the appropriate tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 24.20 Breaches of the Companies Acts The Inspectors have considered also whether Hamilton Ross breached any of the provisions of the Companies Acts, 1963-1990. In this context, it is important to bear in mind that Hamilton Ross is a company incorporated outside the State and relatively few of the provisions of the Companies Acts therefore apply to it. However, Part XI of the Companies Act, 1963 applies specifically to companies incorporated outside the State which have an established place of business within the State. The Inspectors have concluded that Hamilton Ross had established places of business within the State at 42 Fitzwilliam Square and Inns Court Winetavern Street and accordingly, Part XI of the Companies Act, 1963 applies to Hamilton Ross. The purpose of the provisions contained in Part XI of the Act of 1963 is to ensure that some basic information is available in Ireland in relation to companies incorporated outside the State but doing business in Ireland. Thus, Section 352 requires such companies, within one month of the establishment of a place of business within the State to deliver to the Registrar of Companies certain basic information including: (a) A certified copy of its constitutional documents (e.g. the Memorandum and Articles of Association) and, if applicable, a certified translation thereof; (b) Particulars of its directors and secretary; (c) The names and addresses of persons resident in the State who are authorised to accept service of process notices and the like on behalf of the Company; (d) The address of the Company’s principal place of business in the State; (e) Any changes in all or any of the aforementioned documents and particulars. By Section 353 the Company is obliged, if there is any alteration in any of the foregoing, to deliver a return to the Registrar of Companies containing the prescribed particulars of the alteration. Pursuant to Section 355 Hamilton Ross was obliged to exhibit conspicuously on every place where it carried on business in the State the name of the company and the country in which it is incorporated. By Section 357 of the Act, Hamilton Ross, if it ceased to do business in the State (which it did in or about 1997) was obliged to forthwith give notice of the fact to the Registrar of Companies. It was of the essence of Hamilton Ross’s Irish business that it be conducted in secret. The Inspectors have detailed elsewhere the lengths, which Mr Traynor went to conceal, even in statements given to clients, the fact that Ansbacher was doing business in Ireland. This policy of concealment continued in respect of the Hamilton Ross business. It comes as no surprise therefore to find that, like Ansbacher, Hamilton Ross breached each and every one of the provisions referred to above. By Section 358 of the Act of 1963, it is provided that if any company fails to comply with any of the provisions of Part XI of the Act the company and every officer or agent of the company who knowingly and wilfully authorises or permits the default is liable to a fine not exceeding £500. The Inspectors are satisfied, both on the balance of probabilities and beyond reasonable doubt, that Hamilton Ross has failed to comply with each of the foregoing provisions. 24.21 Unlicensed banking The business of banking in Ireland is regulated, inter alia, by the provisions of the Central Bank Act, 1971 (as amended) and the Central Bank Act, 1989. The relevant provisions of these Acts have been set out in Chapter 5. The Inspectors are satisfied that Hamilton Ross carried on business in Ireland, and that there is evidence tending to show that that business was banking business within the meaning of the Central Bank Acts, 1971 and 1989. In particular: (a) Irish clients were enabled to lodge and withdraw money in Ireland albeit that their funds were in Hamilton Ross. These transactions were carried out principally on or from the premises of CRH. Occasionally, Mr Traynor would meet people by arrangement to conduct their transactions, or money would be delivered to their homes by Mr Traynor’s driver or by the CRH porter. This is described in greater detail elsewhere in this report. A number of persons have given evidence to the Inspectors that they made lodgements on the premises of CRH. These transactions were an intermingling of Ansbacher and Hamilton Ross business. Later the location changed to Winetavern Street. (b) Transactions in relation to Hamilton Ross funds of Irish clients were entered on a computer in CRH weeks before similar entries were made in Cayman. (c) From November 1992, letters emanating from 42 Fitzwilliam Square were on headed paper bearing the name of Hamilton Ross and requesting that, where appropriate, replies be directed to 42 Fitzwilliam Square and later to Inns Court, Winetavern Street. By these communications, Hamilton Ross held itself out as being engaged in the business of banking at these addresses. Hamilton Ross did not have the licence required by Section 7 of the Central Bank Act, 1971 (as amended) to carry on the business of banking in Ireland. Indeed, it did not even apply for such a licence, (see letter from the Central Bank at Appendix XVT(j)). The Inspectors are, therefore, satisfied that Hamilton Ross carried on an unlicensed banking business, and that there is therefore evidence tending to show the commission of a criminal offence. 24.22 Breaches of the taxation code by Hamilton Ross A detailed treatment of the taxation legislation pertinent to an analysis of Ansbacher’s wrongdoing is presented in Chapter 5. The Inspectors have based their analysis of the failure of Hamilton Ross to comply with taxation laws on the same detail. The Inspectors conclude that there is evidence tending to show that Hamilton Ross may have: 1. Breached Section 141 of the Corporation Tax Act, 1976 by failing to notify the Revenue Commissioners of the commencement of business within the State as required. 2. Breached Section 142 of the Corporation Tax Act, 1976 by failing to deliver to the Revenue Commissioners a Notice of Liability to Corporation Tax. 3. Failed to pay Corporation Tax lawfully due. 4. Breached Section 31 of the Finance Act, 1974 in respect of its obligations to deduct tax from interest paid. 5. Failed to make deductions from payments to employees contrary to Section 126 of the Income Tax Act, 1967 (now Section 985 of the Taxes Consolidation Act 1997) and corresponding Social Welfare legislation. CHAPTER 25 THE ROLE OF THE CENTRAL BANK INDEX Page 25.1 Introduction 450 25.2 The nature and practice of Central Bank regulation 451 25.3 Bank required to have regard to qualitative factors 452 25.4 The 1976 inspection of Guinness and Mahon and subsequent events 453 25.5 The 1978 inspection and related events 457 25.6 The 1982 inspection and subsequent events 464 25.7 The 1986 inspection and subsequent events 467 25.8 The 1988 inspection and subsequent events 469 25.9 The current view of the Central Bank in relation to the activities of 25.10 Ansbacher 470 Conclusions on the role of the Central Bank 471 THE ROLE OF THE CENTRAL BANK 25.1 Introduction When assessing the role of the Central Bank (hereinafter referred to as ‘the Bank’) in the affairs of Ansbacher, it is important to bear in mind that the Inspectors are investigating Ansbacher and not the Bank. Furthermore, Ansbacher at no time came directly under the supervisory jurisdiction of the Bank but came to the attention of the Bank only as a subsidiary of Guinness and Mahon. Likewise, the Inspectors are not investigating Guinness and Mahon though, as appears from what has already been set out in this report, Guinness and Mahon does feature centrally in the affairs of Ansbacher. These considerations notwithstanding, the Inspectors are conscious that, on foot of the High Court Order of 22 September 1999, they are charged, in their investigation of the affairs of Ansbacher, to report upon any related matters. As appears from what is set out hereunder, certain aspects of Ansbacher’s business in Ireland came to the attention of the Bank and it is for this reason that the Inspectors see fit to refer to the role of the Bank. It is also important, when assessing the role of the Bank in the affairs of Ansbacher, to bear in mind what was regulatory practice at the time of the events in issue and to be careful not to form any conclusion based upon later concepts of regulatory practice. Furthermore, the Inspectors are cognisant of the fact that only certain aspects of Ansbacher’s business came to the attention of the Bank and that other aspects of its business, including the system of maintaining memorandum accounts recording the interests of Irish residents in deposits held by Guinness Mahon Cayman Trust/Ansbacher, were concealed from the Bank. 25.2 The nature and practice of Central Bank regulation The Bank is statutorily responsible for the supervision of most financial institutions in Ireland, including banks. The Bank’s supervisory powers were first established in relation to banking supervision in the Central Bank Act 1971. Since then the Bank’s supervisory remit has been extended considerably, though for the most part, those extensions have no relevance to the work of the Inspectors. The Bank’s regulation of banking is concerned principally with protecting against what is known as systemic risk and prudential risk. Systemic risk is the risk associated with the collapse of a bank, which may in turn prompt the collapse of other banks or related financial institutions. Prudential risk is the risk associated with depositors and investors, persons who are not usually in a position to judge the safety and soundness of a particular financial institution. The Bank’s regulation therefore has two objectives: firstly, to manage systemic risk thereby seeking to ensure that the financial system as a whole is secure and, secondly, to reduce the risk of an individual institution failing, with the consequent loss to depositors and investors. The Bank is not principally concerned with Revenue matters and indeed, subject to certain exceptions which are not here relevant, the duty of confidentiality imposed upon the Bank and its staff is such that it may not disclose information about individual persons or entities to third parties including the Revenue Commissioners. This is another important point to bear in mind when assessing the role of the Central Bank in the affairs of Ansbacher. The Central Bank Act, 1971 vested in the Bank the power to grant bank licences. The Act also provided, for the first time, for on-site inspection of banks. The system which initially evolved from the 1971 Act was, in common with other countries, one which set out to achieve regulatory objectives by imposing general ‘one size fits all’ ratios on banks. These traditional ratios sought to identify certain key risks such as credit risk, lack of diversification and lending to connected institutions. The practice of regulation has changed dramatically over the past thirty years but this concentration on ratios is a feature of the Bank’s supervision of Guinness and Mahon in the late 1970s and for much of the 1980s. That said, there has always been both a quantitative and a qualitative aspect to the Bank’s supervisory technique. Thus, pursuant to Section 9 of the Central Bank Act 1971 the Bank is empowered to refuse to grant a banking licence in circumstances where it is satisfied that a grant would not be in the interests of the orderly and proper regulation of banking. Furthermore, pursuant to Section 10 the Bank may grant a banking licence subject to conditions which, in the opinion of the Bank, are calculated to promote the orderly and proper regulation of banking. Those conditions may be amended, revoked or added to from time to time by the Bank if it is of the opinion that such action is calculated to promote the orderly and proper regulation of banking. Pursuant to Section 11 of the 1971 Act, the Bank may, with the consent of the Minister for Finance, revoke a bank licence if the circumstances relevant to the grant are changed and are such that, if an application for a licence were made in the changed circumstances, it would be refused. 25.3 Bank required to have regard to qualitative factors It is apparent therefore that from the very beginning of banking regulation the Bank was required to have regard to qualitative factors. These factors included the quality of the management of a bank and the nature of the activities being carried on by a bank. Thus, whilst it has been emphasised earlier that the Bank is not principally concerned with Revenue matters, the Bank was and is statutorily obliged to concern itself with the proper regulation of banking. In this context, any evidence that a bank was facilitating tax evasion was at all material times a matter of concern for the Bank. Ongoing supervision of existing entities by the Bank consisted of: (a) regular collection and analysis of data; (b) regular reviews with management of the institution; (c) dealing with specific issues; (d) on-site inspection. This is the approach that was adopted in relation to Guinness and Mahon and it is through this approach that the Bank came into possession of certain information in relation to particular aspects of Guinness and Mahon’s business, including those aspects which concerned its Cayman subsidiary. 25.4 The 1976 inspection of Guinness and Mahon and subsequent events Inspections are usually carried out by two bank examiners, one of whom is termed the Lead Examiner. The Lead Examiner plans the inspection and is the person principally responsible for writing the examination report. That report is reviewed by a more senior person in the Bank. The Lead Examiner on the Guinness and Mahon examination in 1976 was Mr Adrian Byrne. Mr Byrne is currently the Head of Banking Supervision in the Bank. The other examiner was Mr John Rockett and the review person was Mr Bernard Daly. All three gentlemen were chartered accountants by qualification. The principal purpose of the 1976 inspection was to consider the Guinness and Mahon loan book and in particular, the recoverability of the loans. That entailed an examination of the security for those loans which in turn revealed the back-to-back nature of some of the deposits with Guinness and Mahon. As part of their inspection, the bank examiners had regard to the offshore subsidiaries of Guinness and Mahon, including in particular Guinness Mahon Cayman Trust Limited, which at that time had deposits of IR£14.3 million with Guinness and Mahon. The clear impression gained by the bank examiners in relation to these deposits is that they were part of a scheme which was surrounded by a unique level of secrecy and which appeared to involve tax evasion. This impression gained by the bank examiners is clear from the report which they wrote at the time in relation to the inspection and is clear also from the evidence given by Mr Adrian Byrne to the Inspectors. Referring to the offshore subsidiaries and in particular Guinness Mahon Cayman Trust Limited, the bank examiners wrote: ‘We are satisfied from our conversations with M r J.D. Traynor that a major part o f these companies ’ activities is in the receipt o f funds on which taxation has been avoided. The largest o f the offshore subsidiaries is the Cayman Island company which we understand has received no funds from the Scheduled Territories since 22nd June 1972 - the date the Cayman Islands became in effect a foreign state fo r exchange control purposes.... The bank is in effect offering a special service which assists persons to transfer funds, on which tax has been avoided, to offshore tax havens. The possibility o f the bank abusing its position as an authorised dealer in providing this service cannot be ignored. In view o f the delicate nature o f these matters we did not pursue the matter fu rth e r.... The directors o f the bank were initially reluctant to give information about the activities o f these companies to the Central Bank because it feared that the information might be conveyed to the revenue authorities. With regard to cases where loans by Guinness and Mahon (Dublin) were secured by complex back-to-back arrangements o f deposits in these companies, we were given sight o f copy security documents but were requested not to note the names in which the deposits were held. This we agreed to do. No files or records relating to customer transactions with these companies are retained in Dublin. The bank fears that the retention o f such files would give grounds to the revenue to claim that the companies are managed by Dublin and also individual files might come into the hands o f the revenue authorities. We have been assured by M r Traynor that no funds from Ireland have been transferred to the Cayman Islands since 22nd June 1972. Deposits held by the Cayman company have, however, increased by £4.7 million to £14.3 million during the twelve month period to 31 March 1976. We have been assured that this increase has been obtained through deposits from the United States and Jamaica. We have no evidence to support this information. ’ Mr Adrian Byrne, the Lead Examiner on the 1976 inspection, gave evidence to the Inspectors in relation to these entries in the examination report. He told the Inspectors that what the examiners encountered - ‘ ...just didn 7 smell rig h t.... it didn 7 taste right. There was something wrong. ’ Mr Byrne told the Inspectors that, when the examiners wrote of the possibility of the bank abusing its position as an authorised dealer, they were drawing the attention of the reader of their report to the clear possibility that the bank was involved in a scheme of tax evasion. The only readers of the report would have been people holding some senior position within the Bank. He was also drawing the attention of the reader to the fact that they, as examiners, did not pursue the matter further. Mr Byrne also told the Inspectors that the concerns of Guinness and Mahon to ensure secrecy and to ensure that information did not find its way into the hands of the Revenue Commissioners were completely out of the ordinary. Neither before 1976 nor since then had he encountered such a level of concern on the part of any other financial institution. It is clear that Mr Byrne’s own impression was that the bank examiners had encountered systematic tax evasion rather than avoidance. Without proof, he was reluctant to formalise such a conclusion in writing but he wanted to signal it as a clear possibility. He did not think it appropriate on the basis of the information then available to characterise all concerned as engaging in tax evasion. The examiners report was reviewed by Mr Bernard Daly who was the Manager of Banking Supervision. Senior to him was the Assistant Director General who at that time was Mr Timothy O’Grady-Walshe. The next most senior man was the Director General of the Bank who at that time was Mr Bernard Breen and the person in overall charge was the Governor of the Bank who at that time was Mr Charles Murray. Mr Byrne believes that his report would have been discussed internally within the Bank but cannot recall any specific discussion in relation thereto. In any event, arising out of the 1976 inspection, the Bank wrote to the Chairman of Guinness and Mahon by letter dated 9 September 1976 which letter went under the hand of the Governor. In that letter it was stated: A number o f points o f serious concern have emerged from the examination which the Bankfeels ought to be brought to your attention. Tax havens The examination revealed that Guinness and Mahon Limited has banking subsidiaries, closely connected with the Irish bank, operating in offshore tax havens. The Bank is somewhat concerned at the extent o f this involvement and would welcome an opportunity to discuss the matter. ’ Guinness and Mahon Limited replied by letter of 26 November 1976 and in relation to this particular concern on the part of the Bank replied as follows: 7 would not altogether be happy with your understanding o f our situation in this regard and would certainly welcome the opportunity o f discussing the matter. ’ It is clear from this correspondence that the concerns which the bank examiners had expressed had fed their way into the system in the Bank and were now being recorded, albeit in somewhat discreet terms, by the Governor of the Central Bank. Ultimately, a meeting was held on 8 February 1977 between the Bank and Guinness and Mahon. Minutes of the meeting appear to have been kept by Mr Bernard Daly who appears to have attended the meeting along with Mr O’Grady-Walshe on the part of the Bank. In relation to this aspect of matters the minute records as follows: ‘Tax havens M r Traynor outlined in some detail the operation o f the bank’s subsidiary companies in the Cayman Islands, Guernsey and Jersey. He stressed that they were basically trust companies but that a proportion o f the assets being managed were deposited with the trust companies themselves. The three companies in question had banking status. He also emphasised that the funds were not placed on deposit fo r the purpose o f tax avoidance or evasion. (Mr O ’Grady-Walshe and I discussed this matter subsequently and agreed that we should talk with Guinness and Mahon again concerning this matter at a later date). ’ It is clear, therefore, that, from as early as 1976, the Bank had concerns in relation to the activities of the Cayman subsidiary of Guinness and Mahon. Those concerns centred upon the back-to-back deposit arrangements and, in short, the concern was to the effect that the bank was facilitating tax evasion on the part of Irish residents. On behalf of Guinness and Mahon Mr Traynor was maintaining the position that the arrangements were neither for the purpose of tax avoidance or tax evasion, but, from the decision of Mr O’Grady-Walshe and Mr Daly to discuss the matter further, it appears that the Bank continued to have reservations. 25.5 The 1978 inspection and related events On average, the Bank conducted investigations approximately once every two years. The first inspection of Guinness and Mahon subsequent to the 1976 inspection was in fact conducted in June and July of 1978. Earlier in 1978, however, an issue arose regarding the free resources ratio1 of Guinness and Mahon. At a meeting held on 25 January 1978 between Mr Traynor and Mr O’Kelly on behalf of Guinness and Mahon and Mr The free resources ratio is a concept relevant to the amount of capital required to be held by a licensed bank. O’Grady-Walshe and Mr Daly on behalf of the Bank, Mr Traynor indicated that Guinness and Mahon had loans of approximately IR£4 million which were secured by deposits placed with the bank’s Cayman Islands subsidiary and he requested that the Bank would consider these loans as non-risk for the purpose of calculating the free resources ratio. This specific request of Mr Traynor’s was considered by the Bank and in particular by Mr Byrne in the first instance. He wrote a recommendation in the following terms: ‘F rom the information available it would appear that the loans were secured by cash deposit and as such form a normal back-to-back arrangement. However the fa c t that the bank takes such extreme precautions to keep the existence o f the deposits secret from the Revenue Commissioners indicates that the bank might well be a party to a tax evasion scheme. Should this be the case and the Bank accepts the right o f set-off fo r the purpose o f calculating the free resources ratio the Bank would be placed in a very embarrassing position should the revenue authorities ever become aware o f the situation. It is therefore recommended that the Bank does not accept a right o f set-off fo r the purpose o f calculating the free resources ratio. ’ The word ‘evasion’ in this recommendation was crossed out and in manuscript the word ‘avoidance’ was substituted. This was not the first alteration of such a nature made by the Bank. In the 1976 examination report, a reference by Mr Byrne to tax evasion in the context of Guinness and Mahon Channel Islands Limited was altered to refer to tax avoidance. The Inspectors have been informed by solicitors for the Bank that the official who effected these changes has no recollection of these events. Whether the written reference be to tax avoidance or to tax evasion, it is clear from this recommendation that the Bank continued to have concerns regarding the Cayman deposits and that at least some members within the Bank were of the view that Guinness and Mahon was involved in a tax evasion scheme. Mr Byrne’s recommendation was accepted by his superiors within the Bank. Mr Daly telephoned Mr Traynor on 23 March 1978 and informed him that the Bank had considered the question of the cash backed loans and had decided they should continue to be regarded as risk assets. He also intimated to Mr Traynor that Mr O’Grady-Walshe might wish to discuss the ‘tax’ aspect of the loans at a later date. By the time the 1978 inspection was conducted, Mr Adrian Byrne had been promoted and was now the review person on that examination. The examination was conducted by John Fitzgerald, Michael Burke and John Hynes. The examination report contained a summary of the main findings, the first of which was in the following terms: ‘The bank is participating in taxation avoidance arrangements. ’ In relation to this aspect of the main findings the report states as follows: ‘The bank has advanced loans amounting to £5.5 million which, according to the books and records o f the bank, are either partially secured or unsecured ... We have been informed by the Vice Chairman o f the bank, M r D. Traynor, that each o f these loans are, in effect, secured by means o f a cash deposit placed with Guinness and Mahon Cayman Trust Limited - a wholly owned subsidiary o f the bank, or with G&M, Guernsey Limited, a wholly owned subsidiary o f Guinness Mahon Limited London. These deposits are placed as part o f a complex tax avoidance scheme and considerable measures are being taken by the bank to ensure that knowledge o f the existence o f the scheme does not become known to the revenue authorities in Ireland. The scheme, as we understand it, operates as follows.... ‘ [there then follows a detailed and accurate description of the scheme] The first of the conclusions and recommendations to the 1978 examination report is in the following terms: ‘Taxation avoidance scheme The bank has advanced loans amounting to £5.5 million to customers which are secured by deposits placed with Guinness and Mahon Cayman Trust Limited or Guinness Mahon Guernsey Limited. These deposits form part o f tax avoidance schemes. The fu ll extent to which the bank is involved in these schemes is difficult to determine. We are o f the view that while the provision o f advice on tax avoidance within the law may be an acceptable part o f the work o f any bank, it is not, in our view, appropriate or ethitical (sic) fo r a bank to participate in, as distinct from advise on, tax avoidance schemes. We suggest, therefore, that the bank should cease its participation in these schemes. ’ The Inspectors were initially surprised that it should have been the view of the Bank that it was either inappropriate or unethical for a bank to participate in tax avoidance schemes. Of course, it would be quite inappropriate and unethical for a bank to participate in a tax evasion scheme and the Inspectors wondered whether this is really what the report intended to convey. On this issue the following exchange took place with Mr Byrne, who was the reviewer of that report, in the course of his evidence to the Inspectors: ‘Q. Is it the view o f the Central Bank that it is not ethical fo r a bank to participate in a tax avoidance scheme? A. I d o n ’t ... well, I don 7 know whether that is coding again. Q. Yes, yes. You see it is certainly the view, I take it, o f the Central Bank that it is not ethical to participate in a tax evasion scheme? A. Well, yes. Q. Is that what that is really saying? A. I suspect it is. Q. Right? A. I don 7 know but again I think it is code fo r evade, yes. ’ It is clear, therefore, that by 1978 the Bank’s concerns in relation to the cash backed deposits were such as to cause the Bank to recommend that Guinness and Mahon should cease its participation in a scheme involving back-to-back deposits. Whether the terminology used was tax avoidance or tax evasion the message was clear. There is one further feature of the 1978 inspection worthy of remark. In 1978 as opposed to 1976, Guinness and Mahon produced for the Bank a list of the major loans backed by deposits held in Cayman/Guernsey Trust companies. That list included a loan of some IR£416,000 to Mr Ken O’Reilly-Hyland secured by a deposit of IR£230,000 in Cayman. Mr O’Reilly-Hyland was at that time a director of the Bank. There is considerable uncertainty as to what if any steps were taken upon receipt of this information. So far as Mr Byrne is concerned, the matter was recorded in the examination report for others to deal with as they saw fit. Mr O’Grady-Walshe has no specific recollection in relation to the matter but feels sure he would have mentioned it to his superiors. Mr Charles Murray, the then Governor, has no recollection of the matter being raised. There appears to be no documentary record within the Bank recording receipt or consideration of this information. There is nothing in the evidence to indicate, and the Inspectors do not suggest, that the view which the management and the Bank took at the time of Guinness and Mahon’s involvement in such cash back loan business was in any way influenced by Mr O’Reilly-Hyland’s personal situation. Following upon the Bank’s 1978 inspection, there was a meeting on 13 September 1978 between Mr Traynor and Mr O’Kelly on behalf of Guinness and Mahon and Mr Daly, Mr Byrne and Mr Fitzgerald on behalf of the Bank. The Bank’s minute of that meeting records a discussion in relation to tax avoidance schemes in the following manner: M r Daly said that the Central Bank was not happy with the extent o f the bank’s involvement in tax avoidance schemes. The Bank fe lt that such schemes were not in the national interest and it was considering whether to request Guinness and Mahon Limited to wind down its activities in this area. M r Traynor said that such request would make him very unhappy. He added that it was not correct to say that the bank was involved in any tax avoidance scheme. The schemes to which M r, Daly was referring were devised and arranged by the bank’s customers and their, financial advisors. The bank merely informed its customers o f the existence o f the banking facilities available in Guernsey and which were formerly available in the Cayman Islands. It is clear from this minute that the Bank’s concerns were being expressed now in ever more trenchant terms (‘such schemes were not in the national interest’) whilst Mr Traynor was maintaining his position that the schemes were legitimate. The Bank appears not have been convinced by Mr Traynor’s protestations. On 1 November 1978, Mr O’Grady-Walshe on behalf of the Bank wrote to Mr Guinness, the Chairman of Guinness and Mahon Limited. Referring to its offshore banking activities Mr O’GradyWalshe wrote: ‘We are o f the view that there can be no reason fo r , these arrangements other, than to reduce the tax liabilities o f the customers in question. It appears to the Central Bank that your, bank’s involvement in such arrangements is inappropriate and could be considered to be contrary to the national interest. ’ Mr Guinness replied by letter of 1 February 1979 in which he emphasised the complexity of the arrangements and suggested that both Mr Traynor and Mr O’Kelly might meet Central Bank representatives to discuss the whole matter in detail. Such a meeting ultimately took place on 7 March 1979. It was attended by Mr Daly and Mr Byrne on behalf of the Bank. At the meeting, each side maintained its position. Mr Daly indicated that the Bank could see no logical reason for the arrangements other than to assist customers to avoid taxation, whilst Mr Traynor emphasised that all the loans represented genuine banking loans. The impasse between the two sides appears to have been resolved by Mr Traynor stating that the then level of loans which had cash deposits placed in offshore banks as securities would not increase. He went so far as to say that since 1972 (when the Cayman Islands ceased to be part of the sterling area), no new loans had been granted where deposits held in the Cayman Islands formed part of the security and that it seemed to him that the introduction of the then new exchange control regulations would effectively end further loans being advanced where deposits held in the Channel Islands formed part of the security. A minute of the meeting records Mr Daly on behalf of the Bank as indicating that, in view of this assurance given by Mr Traynor that the level of loans was likely to be reduced in the future, the Bank would not wish to pursue the matter further. Mr Byrne, giving evidence to the Inspectors, felt it unlikely that Mr Daly would have been authorised to give such a commitment at the meeting and feels it likely that such a commitment was given by Mr Daly subject to ratification by his superiors within the Bank. In any event, by August of 1979, Mr Traynor appears to have modified his position somewhat. A minute of a standard review meeting with representatives of the Bank records Mr Traynor, when referring to the Cayman deposits, as saying that there was little increase in activity in the Cayman company in the last few years and that he did not think it would grow any further. The meeting is significant in one other respect: it appears to be the first occasion upon which the Bank learned of the routing of money of Irish depositors through Guernsey, on to Cayman and back to Ireland. The minute of the meeting records the Bank being told that Guinness Mahon Guernsey Limited acted as a trustee to hundreds of discretionary trusts which owned companies with a registered office in Cayman. The Bank was informed that deposits from Irish residents were placed in the name of one of these trusts which lent on the money to one of the companies with the funds in turn being deposited with the Cayman bank. The Cayman bank then redeposited the funds with the Dublin bank which was then enabled to give an advance to the original depositor secured by the funds. It appears that matters rested there until 1981. At a standard review meeting held on 29 April 1981, there appears to have been some passing reference to particular loans with a Cayman connection but there appears to have been no further discussion of the overall nature of this banking activity or of its taxation implications. It appears therefore that, whilst the Bank’s concerns about the nature of the activity were never allayed by Mr Traynor, his assurances that the activity would not increase and would likely decrease were sufficient to persuade the Bank to leave matters rest. A further review meeting in February of 1982 produced no reference to the Cayman deposits. 25.6 The 1982 inspection and subsequent events The third inspection of Guinness and Mahon was conducted in the months of August and September of 1982 by Neil Kennedy and Catherine Heery. Once again their inspection report was reviewed by Mr Byrne. Their report was not in fact completed until April 1983. The 1982 report begins with a summary of the main points to arise from the inspections in 1976 and 1978. Surprisingly, there is no reference to the participation by Guinness and Mahon in what had previously been described as ‘taxation avoidance arrangements’. This is so notwithstanding the fact that this was the first of the main findings of the 1978 report. The issue of back-to-back loans was touched upon in the 1982 report. An extract from the report identifies the major loans and identifies one company as having a loan of IR£870,000 with a backing deposit held in the Cayman Islands. An appendix to the report indicated that in the case of this company the sum on deposit in the Cayman Islands was STG£720,000. That information is of some significance because in 1978 when the Bank was first provided with a list of borrowers with back-to-back deposits that list revealed that this company had a loan of IR£595,000 secured by a deposit in Guernsey of IR£595,000. Here then was evidence of the routing of monies to Cayman via Guernsey and an increase of the sums on deposit in Cayman. Later in the 1982 report however it is stated: ‘N o funds have been transferred from this country to the Cayman Islands since 1972. ’ Even if this representation from Mr Traynor was accurate (which it was not), it represented only the literal truth because it was clear that money was being routed from Ireland to Cayman via Guernsey. That information was available to the Bank. It is clear from the 1982 report that the Bank continued to harbour reservations concerning Guinness Mahon’s operations in Cayman. The following is an extract from the report under the heading ‘Guinness Mahon Cayman Trust’: ‘The balance sheet o f the company at 30 September 1982 is contained in Appendix 22. It shows that the company had assets o f £166 million at that date comprised mainly o f liquid assets (£128 million). Advances by the company amount to only £36 million. As fa r as we are aware the bank conducts normal banking operations. consideration as to whether we It is a matter fo r should seek to verify this understanding. ’ In relation to this extract of the report, Mr Byrne confirmed to the Inspectors that the report revealed a ‘very high’ liquidity ratio and that the references to ‘As far as we are aware’, ‘normal banking operations’ and ‘whether we should seek to verify this understanding’ were intended to convey a concern on the part of the Bank regarding the operations in Cayman. On this issue, the following exchange took place between the Inspectors and Mr Byrne: ‘Q. A nd somebody records that this is a matter fo r consideration as to whether you should seek to verify that understanding? A. Yes. Q. What concern has there been signalled? A. That all might not be well. Q. Yes. A. Or what is the Cayman bank at? What type o f business is it in? O. It is the same concern all the way is it not? A. Well, yes. O. Yes? A. I think so. Q. Does this heighten your concern; this information that you have in relation to the balance sheet? A. Well, it would do. I presume that when one saw those figures the immediate reaction was, ‘it is a very highly liquid bank ’. Q. Yes? A. A nd ‘ju st le t’s see what is behind it ’. That no doubt was raised there and that was the question. ’ On 12 January 1983, Mr Byrne and Mr Kennedy on behalf of the Bank attended a meeting with Mr Traynor, Mr O’Kelly and Mr McCleane of Guinness and Mahon. The meeting was held to discuss the outcome of the 1982 inspection. At this meeting, Mr Byrne referred to the commitment given subsequent to the 1978 inspection whereby the bank undertook to reduce its involvement in back-to-back lending. In response, Mr Traynor said that there had been no increase in the level of this type of lending. He provided a list of loans under this heading which totalled IR£1.9 million. At further meetings in May of 1983 and January of 1984 between Bank personnel and Guinness and Mahon personnel, no reference was made to the back-to-back deposits. On 18 July 1984, Mr O’Grady-Walshe and Mr O’Sullivan on behalf of the Bank met with Mr Pender of Guinness and Mahon. The purpose of the meeting was to discuss matters relating to emerging bad debts in Guinness and Mahon and related concerns. Mr O’Grady-Walshe indicated that the Bank was considering carrying out an inspection in Guinness and Mahon. He also referred to developments in bank supervision generally both at home and abroad, focussing particularly on the need for adequate supervision in relation to banking subsidiaries and the application of prudential supervision on a consolidated basis. In keeping with this, Mr O’Grady-Walshe indicated that the Bank would wish to extend its prudential surveillance to Guinness and Mahon Cayman Trust Limited. Mr Pender indicated that it would be necessary to speak to Mr Traynor about that matter. The Bank was aware at this time that Guinness and Mahon’s subsidiaries were contributing approximately 50% to the total group profits. Ultimately, a decision was taken by Guinness and Mahon to sell its subsidiaries to its London parent for a consideration of IR£4.7 million. consequences from the Bank’s perspective. That decision had a number of Firstly, the capital ratio concerns arising from the bad debt situation were removed and, secondly, the supervisory concerns regarding the Cayman operation appeared to become the concerns of the regulatory authorities in the United Kingdom rather than those of the Bank. 25.7 The 1986 inspection and subsequent events The 1986 inspection was carried out in the months of February and March of 1986. The examiners were Mr Neil Kennedy and Ms Ann Horan. Their report was completed on 2 May 1986. Mr Byrne had by this time been promoted further and was not therefore the reviewer of this examination report. The foreword to the report records a number of significant happenings, including the sale of Guinness Mahon Cayman Trust, the resignation of Mr O’Kelly as Managing Director of the bank consequent upon the collapse of a textile company which had substantial borrowings from the bank and the announcement of Mr Traynor’s resignation as Chief Executive and Deputy Chairman of the bank. Under the heading ‘Hypothecated Deposits to Secure Loans’ the following entry appears: ‘D eposits amounting to £11.1 million, as at 31 December 1985, were hypothecated to secure loans to customers and are not included as advances on the balance sheet. These are loans granted by the Dublin bank on the strength o f deposits held in the Cayman Islands and other offshore locations. When these loans are granted an equivalent amount offunds is transferred from the offshore location to the Dublin bank. Most o f these loans are to non-residents. In the case o f loans to residents M r Pender said that it is possible that some tax liability could arise in the event o f default but should this arise additional funds can be transferred to Dublin should this be required. ’ An appendix to the report gives a breakdown of the deposits amounting to IR£11.1 million and does indeed indicate that the bulk of those deposits are referable to non­ residents. However, even a cursory examination of the details set out in the appendix to the 1986 report would reveal that the profile of the Irish resident loans and deposits was significantly different from the profile of the Irish resident loans and deposits referred to in earlier inspection reports. At a minimum, if this information was correct, it indicated that new loans were being granted to Irish residents and new deposits received for and on behalf of Irish residents. In fact, the information supplied by Guinness and Mahon was not accurate but, even taken at face value, it indicated that the assurances previously given by Mr Traynor were not being honoured. Another significant factor emerging from the 1986 report is that the Bank now appeared to be willing to permit Guinness and Mahon to exclude hypothecated loans from risk assets. This was confirmed, in terms, in the 1988 inspection report. The Bank had previously dealt with a specific request from Mr Traynor to treat the hypothecated loans in such a fashion and, after a detailed consideration, had declined that request. This significant change of policy on the part of the Bank in 1986 and subsequently is not recorded in any document and indeed there is no documented consideration of the issue. Giving evidence to the Inspectors, Mr Byrne stated as follows: ‘There would have been in a sense that, when we said no to the set-off originally it was because we were generally unhappy with this tax scheme because there was uncertainty as regards the whole legality o f the thing, whether i f the thing was actually called on, could they get the security in. It was basically surrounding that specific set o f loans. But hypothecated loans or back-to-back loans were set-off which is quite normal banking practice. So once we got over that particular hump and we regarded these as legitimate back-to-back loans, we did allow set-offs. They were loans to non-residents secured by deposits, by cash. ’ This answer is illuminating in a number of respects. Firstly, it confirms that the Bank at all times had reservations about back-to-back loans involving Cayman. Secondly, it indicates that the Bank did take at face value Mr Traynor’s assurances that the amount of such loans involving Irish residents was being run down even though the Bank was being furnished with information indicating that new loans were being granted and new deposits received. Thirdly, it suggests that the Bank was prepared to take a more relaxed view in circumstances where the loans involved non-residents (and not all of them did) even in circumstances where the lending bank was subject to the supervision of the Bank. 25.8 The 1988 inspection and subsequent events The fifth inspection took place in the month of February 1988. The examiners were Mrs A Horan, Ms E Byrne and Mr T Donovan. The report contains little information in relation to Cayman but does confirm that deposits at the bank amounting to IR£8.6 million at 31 January 1988 were hypothecated to secure loans to customers and were therefore excluded from risk assets. Once again, an appendix is attached to the report detailing the loans so hypothecated and, at least in respect of Irish resident persons, that appendix is wholly misleading. Once again, it would appear that Guinness and Mahon furnished misleading information to the Bank. There existed some controversy between Mr Terry Donovan, one of the examiners on the 1988 inspection, Mrs Horan, another of the 1988 examiners and Mr Byrne regarding concerns that had been raised by Mr Donovan relating to the Guinness and Mahon backto-back loans. Mr Donovan appeared to feel that legitimate concerns that he was raising at the time were not being taken sufficiently seriously by other members of the Bank staff. Mrs Horan and Mr Byrne disagree with some of Mr Donovan’s recollections but Mr Donovan in any event was putting the matter no further than to suggest that the Bank had perhaps been unduly hasty in disregarding matters which have subsequently turned out to be highly significant. Another matter which arose in late 1988 was the issue of the appointment of an internal auditor to Guinness Mahon. This topic had been the subject of earlier initiatives on the part of the Bank. From 1982 onwards, the Bank had stressed the importance of the internal audit function and had made a direct request of Guinness and Mahon in June 1986 requiring deficiencies in that respect to be corrected. On 21 November 1988, the Chairman wrote to the Bank indicating that the position of internal auditor had not been filled since the resignation of the previous incumbent but that the function was being fulfilled by the internal auditor of Guinness Mahon London. Mr Byrne informed the Inspectors that the Bank would draw comfort from the workings of an internal auditor. In the event, the internal audit report for Guinness and Mahon of 1989 revealed some startling new information which was never made available to the Bank. In fact, Mr Byrne was not in a position to indicate whether the Bank had even requested sight of the report. The 1989 internal audit report in fact revealed the existence of the memorandum accounts and had that information been made available to the Bank it is likely to have sparked a very significant reaction, particularly in light of the concerns which the Bank had in relation to Guinness and Mahon over a considerable period of time. 25.9 The current view of the Central Bank in relation to the activities of Ansbacher Witnesses on behalf of the Bank have been asked a number of questions based upon the knowledge which they now have of the activities of Ansbacher as opposed to the knowledge which they had at the time of conducting the examinations referred to above. They are consistent in their view that the activities of Ansbacher in Dublin constituted the acceptance of deposits and hence banking, within the meaning of the Central Bank Acts, and that such an activity was unlawful in the absence of a licence. Speaking generally in relation to Ansbacher’s activities, Bank witnesses spoke of being ‘outraged’ whilst Mr Byrne in particular stated that he felt ‘very betrayed by a lot of people in Guinness and Mahon particularly Mr Traynor’. Mr Byrne also made it clear that had the Bank known all of what was actually happening in Guinness and Mahon there would be no ‘doubt or hesitation as to what the Central Bank would have done’. In a subsequent written submission, the Bank has indicated what it would in fact have done: namely, conduct a thorough investigation of Guinness and Mahon with a view to ensuring that persons concerned in the unlawful activities and the deception practised on the Bank would have no place in the banking industry and to take any necessary legal proceedings and also to co-operate with the Director of Public Prosecutions in any criminal investigation. 25.10 Conclusions on the role of the Central Bank In the light of the evidence which has been summarised above the Inspectors reach the following conclusions in relation to the role of the Central Bank: (1) The Central Bank examiners, and in particular, Mr Byrne, deserve credit for detecting the unusual nature of the services being offered by Guinness and Mahon’s Cayman subsidiary and for raising the question as to whether or not the Bank was abusing its position as early as 1976. (2) There may have been a certain reluctance on the part of some members of Central Bank staff to formalise a charge that Guinness and Mahon was engaged in tax evasion, but the suggestion in 1978 that it was not appropriate or ethical for Guinness and Mahon to continue to engage with the particular back-to-back loans then under consideration and the suggestion that the bank should cease its participation in such arrangements is a clear indication that the Bank had very serious concerns regarding the operations of Guinness and Mahon at that time. (3) Mr Traynor sought to mislead the representatives of the Bank when insisting that the arrangements in Cayman involved neither tax evasion nor tax avoidance. He did not succeed in misleading the Bank, which at all times harboured reservations in relation to the back-to-back loan arrangements. (4) The Bank was persuaded not to take action in relation to these arrangements, not by any suggestion that they were wholly innocent, but rather by a representation from Mr Traynor to the effect that their volume would not increase and would in all likelihood decrease. This representation appears to have been accepted by the Bank, and indeed information was subsequently furnished by Guinness and Mahon to the Bank tending to support the accuracy of that representation. The representation was untrue and the information furnished to support it was misleading. It was unwise of and regrettable for the Bank to have accepted Mr Traynor’s representations, particularly in circumstances where the Bank already harboured reservations about his protestations of innocence regarding the back-to-back deposits. Furthermore, there was information available to the Bank which on any reasonable analysis demonstrated that Mr Traynor’s representations were inaccurate. (5) It is regrettable that the Bank did not secure sight of the reports from the internal auditor of Guinness and Mahon and in particular, the internal audit report of 1989. Had the Bank considered that report it would have been forced to take serious action. The ongoing involvement of Mr Traynor and Mr Collery would have been revealed, as would evidence suggesting the conduct of unlicensed banking business by Ansbacher in Ireland. The suspicions regarding a tax evasion scheme would have been heightened even further. In such circumstances, it seems inconceivable that the Bank would have permitted any of Ansbacher’s activities in Ireland to continue. (6) At all material times and even prior to the passing of the 1989 Central Bank Act, the Bank had sufficient powers available to it, be it by threat of revocation of a licence or by the attachment of conditions to the licence, to ensure that Guinness and Mahon did not involve itself in inappropriate banking activity. Had the Bank probed Mr Traynor’s representations further in the early 1980s, there is good reason to believe that the Bank could have availed of these powers to put an end to Ansbacher’s activities in Ireland. It seems certain that had the Bank seen the internal audit report in 1989, it would have availed of these powers to ensure an end to Ansbacher’s activities. (7) A combination of the misleading information furnished by Guinness and Mahon and in particular by Mr Traynor and a failure on the part of the Bank to test, appraise and gather the information available to it resulted in the true nature of Ansbacher’s activities going undetected for longer than ought to have been the case. CHAPTER 26 EXCHANGE CONTROL INDEX Page 26.1 Introduction 475 26.2 Statutory Framework 475 26.3 Conclusions 476 EXCHANGE CONTROL 26.1 Introduction In Chapter 4, the Inspectors concluded that Ansbacher had been carrying on an unlicensed banking business in Ireland. The operation of this business should have brought Ansbacher within the exchange control regime that operated in Ireland from 1954 until 1992. However, in the absence of a banking licence, the company appears to have relied on its banking relationship with Guinness Mahon and IIB in this regard. 26.2 Statutory Framework The Central Bank has provided the Inspectors with a summary of Exchange Controls, which is set out in Appendix XVII(a). The Exchange Control arrangements in Ireland sought to apply an ‘economic’ rationale for implementing exchange controls, with its main purpose being to safeguard the Official External Reserves and to regulate the effects of capital movements on the exchange rate of the Irish pound. From its introduction in 1954, the legislation was developed to reflect Ireland’s participation in the economic development of Western Europe, including the country’s membership of the EEC in 1973, the break with the pound sterling in 1978, the creation of the International Financial Services Centre in 1987 and the gradual movement towards the abolition of controls in 1992. Responsibility for exchange controls was with the Minister for Finance to effect regulations by way of statutory instruments. He delegated his power to established banks who acted as Authorised Dealers. One such was Guinness and Mahon. In 1965, the Minister delegated to the Central Bank responsibility for administering most of the exchange control system. 26.3 Conclusions Ansbacher’s trading in Ireland was assisted through its banking relationships with, mainly, Guinness and Mahon, and, from 1991 (by which time exchange controls had largely been abolished), IIB. The Inspectors are satisfied that any arrangements made by clients with Mr Traynor during the period of exchange control were on the basis that Guinness and Mahon or other Irish financial institution acting on the instructions of Mr Traynor would take whatever steps were necessary in relation to exchange control. Guinness and Mahon were at all times authorised dealers for exchange control purposes. In that context, the individual clients could not be held responsible for any exchange control issues. The Inspectors are satisfied that in so far as any exchange control difficulties arise for Guinness and Mahon or IIB from the activities of the company under investigation these are matters to be taken up (if necessary) by the Central Bank with the institutions involved. These matters therefore fall outside the scope of the Inspectors remit to investigate Ansbacher (Cayman) Limited. INDEX Page 27.1 Introduction 478 27.2 Auditors of Ansbacher (Cayman) Limited 478 27.3 The central role of Guinness and Mahon in the context of its auditors’ actions 479 27.4 The relevant period 479 27.5 Duties of Guinness and Mahon auditors relative to Ansbacher 480 27.6 Assistance provided to Ansbacher by Guinness and Mahon 480 27.7 Incomplete information 480 27.8 Auditors 481 27.9 Conclusions 481 27.1 Introduction In accordance with the terms of the High Court Orders from which the Inspectors derive their authority, the Inspectors have also considered the role of auditors in the matters under investigation. The Inspectors are conscious that their mandate relates to investigating Ansbacher, not the auditors. However, the Inspectors have concluded that, as auditors should have a watchdog type role (which should, if properly performed, have had a bearing on the activities of Ansbacher), some examination of their role was appropriate. The Inspectors therefore decided that the role of the auditors could be a related matter within the meaning of the High Court Order and considered the matter in that limited context. 27.2 Auditors of Ansbacher (Cayman) Ltd The Auditors of Ansbacher (Cayman) Limited are outside this jurisdiction and operate under the laws of the Cayman Islands. The Inspectors concluded that no useful purpose would be served in seeking to investigate the manner in which such audits were carried out as any relevant investigation would be hampered by the confidentiality laws of Cayman. This view was confirmed by legal advice from the Inspectors’ Cayman lawyers. 27.3 The central role of Guinness and Mahon in the context of its auditors’ actions The Inspectors’ initial assessment of the actions of Irish based audit firms mainly centred on the audit of Guinness and Mahon. From the date of Ansbacher’s incorporation in 1971 until 1991, when the Ansbacher accounts were moved to IIB, Guinness and Mahon played a central role in the unlicensed banking operation described in this Report. The Henry Ansbacher Group only acquired GMCT after it had traded illegally for 16 years within the Guinness Mahon Group under the Guinness Mahon Cayman Trust name. 27.4 The relevant period Between 1971 and 1991, various changes occurred which are relevant in the auditing context. 1. From 1971 to 1984, GMCT was a subsidiary of Guinness and Mahon. The Irish business of the company was conducted from Guinness and Mahon’s offices. 2. From 1984 to 1988, GMCT was a subsidiary of Guinness Mahon London. Its Irish business was conducted from the offices of Guinness and Mahon up to 1986; up to 1987, it operated from an office provided by Guinness and Mahon to Mr Desmond Traynor and thereafter from Mr Traynor’s office at CRH pic. 3. From 1988, GMCT (now renamed with an Ansbacher title) was part of the Ansbacher group. It was merely a customer of Guinness and Mahon, as it was later of IIB and Bank of Ireland Private Banking Ltd. Its location in Ireland continued to be at the office of CRH pic. From the foregoing, lthe Inspectors are of the view that the relevant period so far as the role of the auditors is concerned is the period 1971-1988. 27.5 Duties of Guinness and Mahon auditors relative to Ansbacher The duties of the auditors of Guinness and Mahon relative to its interface with GMCT changed as the Cayman company moved from subsidiary to sister company to mere customer. The overriding consideration remained constant, however. Any interaction between GMCT/Ansbacher and Guinness and Mahon, which would have affected the true and fair view of Guinness and Mahon’s balance sheet, should have been reflected in the audit process and reports. 27.6 Assistance provided to Ansbacher by Guinness and Mahon The Inspectors have concluded that GMCT/Ansbacher carried on business in Ireland as a bank, without a licence (see Chapter 5). The Inspectors have concluded that it was facilitated in this by Guinness and Mahon in every way (see Chapters 6 and 14). This assistance was particularly important in the years prior to 1988. During most of this period, staff of Guinness and Mahon were used to update and maintain the records of GMCT’s Irish customers; Guinness and Mahon operated accounts as non-resident when it knew them to be beneficially owned by Irish persons; it provided back-to-back facilities to Irish persons on the basis of incorrectly drafted letters of offer (omitting the back-to-back security); and it provided the facilities whereby GMCT received lodgements and made payments to Irish persons. Some of these activities left traces in the records of Guinness and Mahon, which might have alerted its auditors to what was happening. 27.7 Incomplete information The Inspectors sought the assistance of the audit firms associated with the audit of Guinness and Mahon in respect of audit records. The Inspectors are satisfied that audit files for much of the period no longer exist and any consideration of the matter on the basis of incomplete information must take cognisance of that limitation. 27.8 Auditors Up to 1973, Craig Gardner (now PricewaterhouseCoopers) were the auditors for Guinness and Mahon. From 1973 to 1981, Touche Ross based in London were the auditors but the work was carried out by Stokes Kennedy Crowley (SKC), an Irish firm, which is now part of KPMG. From 1982 to 1986, Touche Ross (now Deloitte & Touche) were the auditors. From 1986 onward, the auditors were Cooper & Lybrand (now PricewaterhouseCoopers). The Inspectors have interviewed representatives of these firms and received information on the audits conducted. This information is limited and largely unsupported by documentation for the period 1971 to 1988 when the involvement of Guinness and Mahon’s auditors should have been greatest due to the intermingling of Guinness and Mahon and GMCT business. During that period, GMCT was first a subsidiary of Guinness and Mahon and later a sister company within the Guinness and Mahon Group. 27.9 Conclusions The Inspectors conclude that it is a matter for the appropriate regulatory authorities to consider whether the fact that different audit firms did not identify the evidence of unlicensed banking business of GMCT over many years highlights any deficiency in either the general practice relating to auditing of the banking sector, and/or, if appropriate, in the manner in which the audit work was completed. The absence of audit records over much of this period and the frequency of changes in audit personnel make it unsafe for the Inspectors to attempt to identify individual shortcomings by those who conducted the audits. Further, the Inspectors are of the view that the assessment of responsibility on a firm-by-firm basis by them would require a degree of speculation inappropriate to an investigation of this type. Therefore it is for the regulatory authorities to decide whether they should or can, with their greater powers and expertise, advance the issues raised by the Inspectors. PERSONS AND COMPANIES WHO FAILED TO CO-OPERATE WITH THE INQUIRY INDEX Page 28.1 Introduction 483 28.2 List of those who failed to co-operate 483 28.3 Inspectors’ recommendation 485 PERSONS WHO FAILED TO CO-OPERATE WITH THE INSPECTORS 28.1 Introduction During the course of their Inquiry, the Inspectors considered that certain individuals who had been required to assist them under Section 10 (2) of the Companies Act, 1990 had ultimately failed to do so. In certain cases, the Inspectors considered that the lack of co­ operation by these people was sufficient to warrant mention to the Court. Those in question are as follows: 28.2 List of those who failed to co-operate Guinness Mahon & Company Limited, London (‘Guinness Mahon London’) When the Inspectors made inquiries of Guinness Mahon London seeking information regarding Ansbacher pursuant to the Companies Acts, the company failed to co-operate. While the Inspectors understand the issues of confidentiality that arise for a bank in relation to requests for information emanating from outside their jurisdiction, they nevertheless point out the obligations imposed by the Companies Acts upon persons who are or may be in possession of information concerning a company under investigation. Investec Bank (UK) Limited (‘Investec’) When the Inspectors made inquiries of Investec seeking information regarding Ansbacher pursuant to the Companies Acts, the company failed to co-operate. While the Inspectors understand the issues of confidentiality that arise for a bank in relation to requests for information emanating from outside their jurisdiction, they nevertheless point out the obligations imposed by the Companies Acts upon persons who are or may be in possession of information concerning a company under investigation. Mr Stephen Enoch Mr Enoch refused to inform the Inspectors of the names of the other partners of Girard Investments when required to do so during an examination under oath. Mr Enoch has been found to be a client of Ansbacher (see Chapter 23). Mr Bernard Etzin Mr Etzin refused to respond to a written requirement of the Inspectors, which the Inspectors can reasonably presume that he received. Mr Etzin has been found to be a client of Ansbacher (see Chapter 23). Mrs Nora Shanahan Mrs Shanahan failed to respond to a written requirement from the Inspectors, which the Inspectors can reasonably presume that she received. Mrs Shanahan has been found to be a client of Ansbacher (see Chapter 23). Mr Michael J Shanley Mr Shanley refused to attend for examination as required in writing by the Inspectors and failed to comply with a written requirement, which the Inspectors can reasonably presume that he received. Mr Shanley has been found to be a client of Ansbacher (see Chapter 23). Mr Martin Turley Mr Turley replied in writing to the Inspectors stating that he had no information relating to Ansbacher. He failed to respond to subsequent correspondence from the Inspectors, which they can reasonably presume that he received. Mr Turley has been found to be a client of Ansbacher (see Chapter 23). Mr John Murphy Mr John Murphy, of 25 Sanderson Close London NW5 ITS England and also c/o J Murphy & Sons Limited, Hiview House, Highgate Road London, is a businessman. The Inspectors wished to interview Mr Murphy so as to establish whether he or any other person could be considered a client of the Company under investigation by reason of certain trusts established by Mr Murphy. The Inspectors also wished to investigate the nature of the contact between Mr Murphy and/or the Murphy Group of Companies and Ansbacher (under any of its names) so as to get a fuller understanding of the nature of the business conducted by that company. Mr Murphy’s solicitors in the course of correspondence admitted that Mr Murphy established certain trusts as Settlor (not in Cayman) and that these trusts did business with the Company under investigation. A requirement to attend for interview was made on two occasions to Mr Murphy with an indication that the interview would be held if requested in London to convenience Mr Murphy. The solicitors for Mr Murphy, by letter of 10 October 2001, conveyed Mr Murphy’s refusal to attend. Because of Mr Murphy’s lack of co-operation, the Inspectors have been unable to conclude whether or not he was a client of Ansbacher. 28.3 Inspectors’ recommendation In view, therefore, of the failure of the above persons and companies to co-operate with them, the Inspectors issue a recommendation to the appropriate authorities that they consider whether an application should be made for a disqualification order, pursuant to Section 160(2)(e) of the Companies Act, 1990 in respect of each of the above-named persons and in respect of each and every member of the boards of Guinness Mahon & Company Limited, London and of Investec Bank (UK) Limited. PART VII SUMMARY OF CONCLUSIONS 486 CHAPTER 29 SUMMARY OF CONCLUSIONS INDEX Page Ansbacher (Cayman) Limited 489 Mr Desmond Traynor 491 Mr John Furze 492 Mr John Collins 493 Guinness and Mahon (Ireland) Limited 494 Guinness Mahon and Company Limited, London 495 Investec Bank (UK) Limited 495 Henry Ansbacher Holdings pic 496 First National Bank of Southern Africa 496 CRH pic 496 Bank of Ireland Private Banking Limited 496 487 Page 29.12 Mr Padraig Collery 497 29.13 Ms Joan Williams 498 29.14 Mr Sam Field-Corbett 498 29.15 Mr Jack Stakelum 499 29.16 IIB 499 29.17 Clients of Ansbacher (Cayman) Limited 500 29.18 Hamilton Ross Company Limited 500 29.19 The Central Bank of Ireland 502 29.20 Exchange Control 502 29.21 The Auditors of Guinness and Mahon (Ireland) Limited 502 29.22 Failure to co-operate with the Inspectors 503 29.1 Ansbacher (Cayman) Limited The Inspectors investigated the affairs of Ansbacher in accordance with the terms of reference set out by the Order of the High Court of 22 September 1999. In Chapters 2,3,4 and 5 of this Report, the Inspectors examine and define the nature and extent of Ansbacher’s Irish business (as defined by the Order), tracing the evolution of the Company from its incorporation in 1971 to the winding down of the Irish business in the mid 1990s. In these Chapters, based on the evidence before them, the Inspectors found that: 1. The ‘memorandum account’ system was operated by Guinness and Mahon and GMCT in a deliberately complex and secretive manner which concealed the names of the clients involved while allowing them to lodge and withdraw funds to and from accounts held nominally for GMCT. 2. Loans were obtained from Guinness and Mahon for GMCT clients on the security of their GMCT deposit, while the existence of this deposit was deliberately omitted from the loan agreement documentation and therefore the general regulatory system of Guinness and Mahon where it would have been seen by bank and Revenue auditors. 3. Ansbacher had established places of business within the State, being at first the premises of Guinness and Mahon and later the premises of CRH pic. 4. Ansbacher knowingly breached Sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 5. Ansbacher carried on banking business in Ireland without holding a licence to do so, which conclusion leads the Inspectors to further conclude that there is evidence tending to show that Ansbacher breached Section 7 of the Central Bank Act, 1971 (as amended). The Inspectors found further that there was evidence tending to show that: 6. The discretionary trust structure as operated by GMCT in conjunction with Guinness and Mahon - through its policy of concealing the true object of the trust, the retention of control by the prime mover over the assets of the trust and the access to the funds provided to the prime mover who could withdraw funds in Dublin - amounted to a sham trust structure. There is also evidence to show that the discretionary trust scheme facilitated widespread tax evasion. 7. That the affairs of Ansbacher were conducted with intent to defraud a creditor of some of its clients, that is the Revenue authorities. 8. That Ansbacher may have committed a number of criminal offences, namely: a) the common law offence of conspiracy (with, inter alia, some of its clients) to defraud, and b) the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the provisions of the appropriate tax legislation, now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 9. That Ansbacher breached Section 5 of the Finances (Miscellaneous Provisions) Act, 1968 by failing to deliver to the Revenue Commissioners a statement in writing containing the particulars set out therein. 10. That Ansbacher breached Sections 141 and 142 of the Corporation Tax Act, 1976. 11. That Ansbacher failed to pay Corporation Tax lawfully due. 12. That Ansbacher breached Section 31 of the Finance Act, 1974. 13. That Ansbacher failed to make deductions from payments to employees, contrary to Section 126 of the Income Tax Act, 1967 (now Section 985 of the Taxes Consolidation Act, 1997). 14. That Ansbacher may have been in breach of Section 10(a) of the Cayman Islands Banks and Trust Companies Law, 1989 (as amended). 29.2 Mr Desmond Traynor Chapter 7 examines the responsibility of Mr Desmond Traynor for the wrongdoing of Ansbacher (Cayman) Limited. Based on the evidence before them, the Inspectors conclude that there is evidence tending to show that: 1. Mr Traynor facilitated the operation of sham trusts on behalf of Ansbacher’s clients. 2. Mr Traynor facilitated the carrying on of a banking business by Ansbacher and Hamilton Ross in Ireland without a licence. 3. Mr Traynor knowingly and wilfully permitted Ansbacher, while carrying on business in Ireland, to breach Sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 4. Mr Traynor knowingly and wilfullly facilitated Ansbacher and Hamilton Ross to conduct their affairs in Ireland in such a manner as to intentionally defraud the Revenue authorities. 5. Mr Traynor improperly used subordinates in the unlawful activities of the business of Ansbacher and Hamilton Ross. 6. Mr Traynor approved of and participated in the making of payments to Mr Collery and Ms Williams without the deduction of the appropriate tax. 7. Mr Traynor facilitated Ansbacher and Hamilton Ross in the evasion of their Corporation Tax liabilities. 8. Many of the aforementioned actions of Mr Traynor may constitute evidence tending to show the commission of criminal offences. 29.3 Mr John Furze Chapter 8 examines the responsibility of Mr John Furze for the wrongdoing of Ansbacher (Cayman) Limited. Based on the evidence before them, the Inspectors conclude that there is evidence to show that: 1. Mr Furze conspired with his fellow-director Mr Traynor to conduct Ansbacher’s affairs with intent to defraud the Irish Revenue Commissioners. This conclusion may constitute evidence tending to show the commission of criminal offences. 2. Mr Furze consented to or approved of the carrying on of an unlicensed banking business by Ansbacher in Ireland. 3. Mr Furze knowingly and wilfully permitted Ansbacher, while it was carrying on business in Ireland, to breach Sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 4. Mr Furze may have been in breach of Section 10(a) of the Cayman Islands Banks and Trust Companies Law, 1989 (as amended). 29.4 Mr John Collins Chapter 9 examines the responsibility of Mr John Collins for the wrongdoing of Ansbacher (Cayman) Limited. Based on the evidence before them, the Inspectors conclude that: 1. Mr Collins must take his share of the responsibility, as one of the three early directors, for the consequences of management decisions made in its initial years, and in particular for the decision to open and maintain the GMCT accounts in Guinness and Mahon, which, the Inspectors have concluded, were operated in such a way as to defraud the Irish Revenue Commissioners. 2. There is evidence tending to show that Mr Collins shares responsibility for Ansbacher conducting unlicensed banking business in Ireland. 3. Mr Collins knowingly and wilfully permitted GMCT, while it was carrying on business in Ireland, to breach Sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 4. Mr Collins shares responsibility for Ansbacher’s possible breach of Section 10(a) of the Cayman Islands Banks and Trust Companies Law, 1989 (as amended). 29.5 Guinness and Mahon (Ireland) Limited (‘Guinness and Mahon’) Chapter 10 examines the responsibility of Guinness and Mahon, in the period 1971 to 1984, for the wrongdoing of Ansbacher (Cayman) Limited and Chapter 14 examines the assistance provided by Guinness and Mahon, during the period 1971 to 1991, to the Cayman Company. Based on the evidence before them, the Inspectors conclude that there is evidence to show that, from 1971 to 1991: 1. Guinness and Mahon conspired with Ansbacher to defraud a creditor of Ansbacher’s clients, namely the Irish Revenue Commissioners, and that there is therefore evidence tending to show that Guinness and Mahon may have committed the offence of conspiracy to defraud contrary to common law. 2. Guinness and Mahon may have committed the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the provisions of the appropriate tax legislation, now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 3. Guinness and Mahon aided and abetted Ansbacher to carry on a banking business in Ireland without a licence to do so, as required by Section 7 of the Central Bank Act, 1971 (as amended). 4. Guinness and Mahon was an accessory to the carrying on of Ansbacher’s unlicensed banking business within the State, and that there is therefore evidence tending to show that Guinness and Mahon may have committed an offence of carrying on an unlicensed banking business in Ireland contrary to Section 7 of the Central Bank Act, 1971 (as amended). 29.6 Guinness Mahon & Company Limited (‘Guinness Mahon London’) Chapter 11 examines the responsibility of Guinness Mahon London for the wrongdoing of Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that: 1. There is evidence tending to show that Guinness Mahon London knowingly assisted Ansbacher in conducting its affairs so as to defraud a creditor of some of its clients, namely the Revenue Commissioners, and that there is therefore evidence tending to show that Guinness Mahon London may have committed the offence of conspiracy to defraud contrary to common law. 2. There is evidence tending to show that Guinness Mahon London may have committed the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the provisions of the appropriate tax legislation, now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 3. Guinness Mahon London failed to co-operate with the Inspectors as required by Section 10(2) of the Companies Act, 1990 and the Inspectors therefore recommend that consideration should be given by the appropriate authorities as to whether an application should be made for disqualification orders in respect of the directors of Guinness Mahon London, pursuant to Section 160(2)(e) of the Companies Act, 1990. 29.7 Investec Bank (UK) Limited The Inspectors conclude that Investec Bank (UK) Limited, as the current owners of Guinness Mahon London, failed to co-operate with them as required by Section 10(2) of the Companies Act, 1990 and the Inspectors therefore recommend that consideration should be given by the appropriate authorities as to whether an application should be made for disqualification orders in respect of the directors of Investec Bank (UK) Limited, pursuant to Section 160(2)(e) of the Companies Act, 1990. 29.8 Henry Ansbacher Holdings pic Chapter 12 examines the responsibility of Henry Ansbacher Holdings pic for the wrongdoing of Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that Henry Ansbacher Holdings pic bears responsibility for the continuation of the carrying on of unlicensed banking business in Ireland by Ansbacher after October 1991. 29.9 First National Bank of Southern Africa (‘FNBSA’) Chapter 13 examines the involvement of FNBSA in the wrongdoing of Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that, taking into account the fact that all of Ansbacher’s Irish business was wound down by FNBSA between the time that they acquired the Company and before the commencement of the McCracken Tribunal, it would be unfair to categorise FNBSA as having equal responsibility with others for the conduct of Ansbacher’s unlicensed banking business. 29.10 CRH pic Chapter 14 examines the assistance provided by CRH to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that: 1. CRH provided assistance to Ansbacher (Cayman) Ltd in the carrying out of its business in Ireland. This assistance cannot be said to have been given knowingly, having regard to the legal principles concerning corporate knowledge, but it is a matter for which CRH must bear some responsibility. 29.11 Bank of Ireland Private Banking Limited (‘BOIPB’) Chapter 16 examines the assistance provided by BOIPB to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that: 1. By their failure to raise questions about the residential status of the beneficial owners of the relevant accounts, BOUPB assisted Ansbacher (perhaps unwittingly) in concealing the fact that Irish residents were the owners of the funds in the relevant accounts, and thus - again, perhaps unwittingly assisted Ansbacher to conduct Ansbacher’s business so as to defraud a creditor of Ansbacher’s clients, namely the Revenue Commissioners. 29.12 Mr Padraig Collery Chapter 17 examines the assistance provided by Mr Padraig Collery to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that there is evidence to show that: 1. From 1989 to May 1994, Mr Collery assisted Ansbacher in carrying on an unlicensed banking business, in breaching Sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963, in evading tax due on its own activities and in assisting others to evade tax. 2. From 1989 to May 1994, Mr Collery knowingly assisted Ansbacher in conducting its affairs in the State so as to defraud a creditor of some of its clients, namely the Revenue Commissioners. 3. From late 1992/early 1993 to 1995, Mr Collery also knowingly assisted Hamilton Ross in operating its unlicensed banking business in Ireland, in its breaches of Sections 352, 353, 355 and 357 of Part XT of the Companies Act, 1963, in evading tax due on its own activities and in carrying on business in the State in such a manner as to defraud a creditor of some of its clients, namely the Revenue Commissioners. 4. From 1989 to 1995, Mr Collery may have committed: a) the common law offence of conspiracy to defraud, and b) the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statements or accounts in connection with their tax contrary to the provision of the appropriate tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 29.13 Ms Joan Williams Chapter 18 examines the assistance provided by Ms Joan Williams to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that: 1. Ms Joan Williams would have acquired some level of understanding that the Ansbacher scheme had a tax evasion dimension. However, her position within the hierarchy of the firms in which she worked and the complicated nature of the issues involved would have effectively rendered her powerless to oppose Mr Traynor’s course of action. 29.14 Mr Sam Field-Corbett Chapter 19 examines the assistance provided by Mr Sam Field-Corbett to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that there is evidence to show that: 1. From 1994 to 1997, Mr Sam Field-Corbett may have acted in breach of Section 7 of the Central Bank Act, 1971 (as amended), by aiding and abetting in the manner envisaged by Section 8 of the Accessories and Abettors Act, 1861 and/or Section 7(1) of the Criminal Law Act, 1997, thereby rendering himself responsible as a principal offender. 2. Mr Field-Corbett assisted Hamilton Ross in breaching Section 355(b) of Part XI of the Companies Act, 1963. 29.15 Mr Jack Stakelum Chapter 20 examines the assistance provided by Mr Jack Stakelum to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that: 1. Mr Jack Stakelum assisted Ansbacher in the carrying out of its Irish business, but that this assistance was unknowing. 2. There is evidence tending to show that Mr Stakelum, in undertaking knowingly his deposit taking activities, may have committed a number of criminal offences as follows: a) The common law offence of conspiracy to defraud; b) The offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statement or account in connection with their tax, contrary to the provisions of the relevant tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997; c) That, in accepting deposits from and effecting withdrawals on behalf of his clients, Mr Stakelum may have carried on a banking business within the meaning of the provisions of the Central Bank Act, 1971 (as amended) and 1989, and that he did so without the requisite licence. 29.16 IIB Chapter 21 examines the assistance provided by IIB to Ansbacher (Cayman) Ltd. Based on the evidence before them, the Inspectors conclude that: 1. IIB provided assistance to Ansbacher between 1991 and 1997, which enabled Ansbacher to continue its operations in the State. There was a substantial body of knowledge within IIB concerning the nature of the Ansbacher operations, but this knowledge was not concentrated in such a way as to enable corporate knowledge to be imputed to IIB. 2. IIB provided assistance to Hamilton Ross between 1991 and 1997, which enabled Hamilton Ross to continue its operations in the State. There was a substantial body of knowledge within IIB concerning the nature of the Hamilton Ross operations, but this knowledge was not concentrated in such a way as to enable corporate knowledge to be imputed to IIB. 29.17 Clients of Ansbacher (Cayman) Limited The Inspectors, having identified a total of 190 clients of Ansbacher (details of whom appear in Chapters 22 and 23), conclude that this constitutes the larger proportion of the clients that they are required to identify. Reports of a larger number of clients appear to be based on counting both the individuals beneficially entitled to the funds and the corporate entities used by them. 29.18 Hamilton Ross Company Limited (‘Hamilton Ross’) Chapter 24 examines Hamilton Ross as a related matter. Based on the evidence before them, the Inspectors conclude that, between 1992 and early 1997: 1. Hamilton Ross had established places of business within the State, being at first the premises of CRH pic and later the premises at Inns Court, Winetavern Street, Dublin. 2. Hamilton Ross knowingly breached Sections 352, 353, 355 and 357 of Part XI of the Companies Act, 1963. 3. Hamilton Ross carried on banking business in Ireland without holding a licence to do so, which leads the Inspectors to further conclude that there is evidence tending to show that Hamilton Ross breached Section 7 of the Central Bank Act, 1971 (as amended). 4. The affairs of Hamilton Ross were conducted with intent to defraud creditors of some of its clients, that is the Revenue authorities. 5. Hamilton Ross was guilty of a number of criminal offences, namely: a) the common law offence of conspiracy (with, inter alia, their clients) to defraud, and b) the offence of knowingly aiding, abetting, assisting, inciting or inducing another person to make or deliver knowingly or wilfully any incorrect return, statement or account in connection with their tax, contrary to the provisions of the relevant tax legislation now consolidated in Sections 1056 and 1078(2) of the Taxes Consolidation Act, 1997. 6. Hamilton Ross breached Sections 141 and 142 of the Corporation Tax Act, 1976. 7. Hamilton Ross failed to pay Corporation tax lawfully due. 8. Hamilton Ross breached Section 31 of the Finance Act, 1974. 9. Hamilton Ross failed to make deductions from payments to employees, contrary to Section 126 of the Income Tax Act, 1967 (now Section 985 of the Taxes Consolidation Act, 1997). 29.19 The Central Bank of Ireland Chapter 25 examines the Central Bank as a related matter. Based on the evidence before them, the Inspectors conclude that: 1. A combination of the misleading information furnished by Guinness and Mahon and in particular by Mr Traynor and a failure on the part of the Bank to test, appraise and gather the information available to it resulted in the true nature of Ansbacher’s activities going undetected for longer than ought to have been the case. 29.20 Exchange Control Chapter 26 examines the issue of exchange control as a related matter. Based on the evidence before them, the Inspectors conclude that responsibility for exchange control issues could not be assigned to the individual clients of Ansbacher. In so far as any exchange control issues pertained, Guinness and Mahon and IIB would have been the responsible bodies. However, these matters fall outside the scope of this Inquiry. 29.21 The Auditors of Guinness and Mahon (Ireland) Limited Chapter 27 examines the role of the auditors of Guinness and Mahon as a related matter. Based on the evidence before them, the Inspectors conclude that it is a matter for the appropriate regulatory authorities to consider whether the fact that different audit firms did not identify the evidence of unlicensed banking business of GMCT over many years highlights any deficiency in either the general practice relating to auditing of the banking sector, and/or, if appropriate, in the manner in which the audit work was completed. 29.22 Failure to co-operate with the Inspectors Chapter 28 examines, as a related matter, the issue of those who failed to assist the Inspectors in this Inquiry. The Inspectors conclude that the following persons failed to co-operate as required under Section 10(2) of the Companies Act, 1990 and they issue a recommendation to the appropriate authorities that they consider whether an application should be made for a disqualification order, pursuant to Section 160(2)(e) of the Companies Act, 1990, in respect of each of the following persons: 1. Mr Stephen Enoch 2. Mr Bernard Etzin 3. Mrs Nora Shanahan 4. Mr Michael J Shanley 5. Mr Martin Turley 6. Mr John Murphy 7. The individual members of the board of Guinness Mahon & Company Ltd, London 8. The individual members of the board of Investec Bank (UK) Limited. Appendix I (a) Order o f the High Court o f 22 September 1999 o f Johnson J. (b) Order o f the High Court o f 8 December 2000 o f Finnegan P. (c) Order o f the High Court o f 6 April 2000 o f Finnegan P. (d) Order o f the High Court o f 25 May 2001 o f Finnegan P. THEHIGH.COURT " 1999 No I6'3COS . Wednesday the 22nd day of September 1999 BEFORE MR JUSTICE JOHNSON' •. • IN TUE MATTER OF THE COMPANTES ACTS 19 j . j f. John Lawless Brian Cox Christina Loughlm Ilal McGuckin all filed in Court on ; this day and the documents and exhibits in said Affidavitsreferred to the Affidavit : * of Gerard Ryan filed in Court on this day the Affidavit of Paul Appleby sworn on I-. I The 26th day o f July 199.9 the documents and exhibits in said Affidavit referred to the second Affidavit of Paul Appleby filed in Court on (his day .(seeking inter alia ; *' " *• 6.1. THE HIGH COURT • t- I " suvd exhibits ill said Affidavit referred to and on hearing said Counsel there beiiv> no appearance oil behalf of the Company in the title hereof . The Court doth deem good and sufficient' service the scrvicc effected * * by rhe said Hal McGuekin and referred to in his Affidavit filed in Court on this da- • IT IS ORDERED pursuant to Section 8 of the Companies Act 1990 , ‘ • that the persons named hereunder be appointed as Inspectors to investigate the offices of Ansbacher (Cayman) Limited (formerly Guinness Mahon Cayman TrustLimited Ansbacher Limited and Caymanlnteajoational Bank and Trust Company • larailed) ’ . a) The Honourable Mr Justice Declan Costello b) Ms Noreen P Maokey Banister-at-LaW ?) Paul F Rowan Chartered Accountant . . IT IS ORDERED that the said Inspectors investigate and report to the • Court on the affairs of the Company in the title hereof and in particular to examine and define the nature and extent of the Company's Irish 00 business from 1971 to date ie . the business carried out in the State or • any other business carried out on behalf oflrish residents whether in ■ the State or cslsowhere , « to identify as far as possible all of the parties who were either officers Q. Note re Irish E xc hange Control Regulations Note re Richie R y a n 1974 A c t Risks Fees and Costs Lj 3 £ ~ (o TRUST A Trust is' something created b y deed w hereby somebody gives property to somebody else to ho ld for the b e ne fi t of certain specified b eneficiaries. CLIENT The person giving the p r o p e r t y to the Trustee shall for the purpose of this note be referred to as the Client. DISCRETIONARY, N O N - D I S C R E T I O N A R Y & O P E N TRUSTS A Discretionary Trust is one i n w h i c h discretion in relation to the decisions affecting the p r o p e r t y or it's transfer to potential benefici ari es are legally at the d i s c r e t i o n of the Trustees and where the Client abdicates all legal control in r e l a t i o n to s u c h decisions from the point at w h i c h the Trust arrangement comes into being. In a Non-Discretionary T r u s t the Client retains the T r u s t e e s . the right of instr uc tin g In an earlier note I had a reference to an Open Trust and I do not k n o w wh at that m e a n s . TRUSTEE • The Trustee is the p a r t y i n w h i c h there has b e e n vested the authority to h o l d property for the be n e f i t of certain specified beneficiaries and w h i c h is b e i n g trusted b y the Client to make decisions in relation to the holding and transfe rr in g of the p r o p e r t y in accordance with the w i s h e s of the Client. SETTLOR • The Settlor is the e xe cutive or adminis tr at or who gives effect to the steps necessary to b ri n g a Trust arrangement into being. A Settlor will usually be a pr ofessional person engaged inter-alia in the activity of creati ng Trusts and Trust arrangements. TRUST DEED The structure and operation of any Trust in the Cayman Islands must operate in accordance w i t h the Trust laws of the Islands. In the c a d e of a specific Trust arrangement the activities of the Trustees are also guided and governed by a Trust Deed and a supplemental deed . The Trust Deed is the principal document and as I understand it the principal feature of this Deed is that it specifies all those w ho can be beneficiaries under the Trust but does not specify the specific rules to be adopted in making decisions in relation to the property held by the Trus t . The Trustees can at any time in their absolute discretion transfer part or all of the pr op er ty to any beneficiary or beneficiaries under the Trust Deed that it wishes but it cannot settle property on any party other than a party specified as a beneficiary under the Trust Deed. SUPPLEMENTAL DEED O R L E T T E R O F WISHES The Supplemental Deed is also called the Letter of Wishes and it is the letter w r i t t e n in the first instance by the Settlor to the Trustees indicating his wishes w i t h regard to the operation of the Trust. As I understand it the Trustees c a n disregard the Letter of Wishes eventhough the normal practice is that they take full account of the L e t t e r of W i s h e s . It is my u nderstanding that legally the Trustees are not under any ob ligation to abide by the wishes of the Settlor1. In an eo J ilie A cLucu& sion tk e A z wcu A zfizA zn cz t o an Opzn TAuAt t o avowed t a x a t i o n co n A ideA ation A heAZ. A - Q .I I.1 voouutd appzaA t h a t an Opzn TAuAt may b z the. tamz cu a ViACA-ttLoncvnj T n iu t. I wouZd Like, to clatU fiy. I n t h a t zo a L L za note. I t uxu 6 t a t z d t h a t th e. T A iu t and T A tu tz z t, o a z one. and the. tame.. A - Q .2 . .... V'-' • Aa I u n d e /u ta n d Jit the. T /iiu t -U a Izg a U L y cA.ea.ted z n t i t y t h a t -c4 m poioeA zd th ro u g h th e. a c t o£ IzgaJL cA ex itio n t o a c t 06 a Tau*>tzz. A - Q .3 W hat eZi>z doeA a t y p i c a l T A iu t V zed 6 a y o th e A th a n t o 6 pe.cU.6 y t h z b z n z ^ ic ia A lz & . A - Q .4 UlouZd I t be. p o a i b t z t o 4 en d me. a £ew zxampl&A oft TAuut V zzdt, an d L e t t e r o& Wi i h z s ? A - Q .5 Am I A ig h t i n undeAAtancUng t h a t t h z TAa&tzeA ca n I z g a Z ly ' dl& AzgaAd t h z w i i h z i c o n ta in e d Jen t h z L z tte A W*Uhz6 oa in d z e d i n a n y o th e A cotm u .n icatijon fiAom t h z C t l z n t oa hu> n o m in zz. A - q .6 Am I A ig h t i n andeA & tanding t h a t t h z T A u itzeA can A i t t t z am ounts o n l y on l i i t z d A - Q .7 b z n z ^ id a A ie ^ . Thz e a A tie A n o tz it a X z d t h a t t h z b z n zfiic ia A iz A had to be c h a s t i t i e s oa c h a A ita b lz oAg a n im a tio n * . 14 tfv U c o A iz c t? A - Q .8 The. m nZleA . note. s t a t e d t h a t the. Th.uAte.eA had to b e ch asuA able. 0 A .ganu atjx> n 6 . Am I fu ig k t I n th in k i n g now t h a t t h a t uai a n ln c.on A zc.t n o te .? A - Q .9 In th e. qjojULIqa. n ote. th eA Z m u a 6 tc u tw e .n t t h a t onae. the. T h iu t am a.ngejne.nt vxu cA ea-ted i t c o u td n o t be. unwound. I uoouZd t i k e , t o claA lfay w h a t t h a t mzan.6 . R V - 3E S FROM JOHN FURZE TO A-QUESTIONS The Client authorises The Settlor creates a S ettlor to create the Trust arrangement. the Tr u s t arrangement by (a) drawing up the Trust Deed; (b) obtaining the agreement of a selected Trustee Trustee; (c) arranging ap propriate engrossment of the Trust Deed; (d) preparing and s e nd in g a Letter of Wishes to act as to the Trustees. The Settlor and the Client arrange the transfer of the appropriate property to the control of the Trustee. B - Q .1 U th e. corvtznX o i t l v u S t a t i o n :PLIES FROM JOHN FURZE TO B-QUESTIONS (8 ) conA&tt? As already stated the Client has no legal control over the decisions of the Trus tee s. j The practice however is that the Trustees will fully accept the wishes expressed in the Letter of W i sh es provided doing so is not in c ontravention of the appropriate Trust laws. Usually at the outset the L e t t e r of' Wishes will contain the w i s h that the Trustees should in the future be guided by the day-to-day instructions of some specified pers on and that specified person would be the Client or ' omebody acting to the order of the Client. The Settlor has in the first instance t h e power to change the Trustees at any time but at the time of c r e a t i o n of the Trust he renounces his right in favour of the Client. Because the Trustees will a cknowledge the wishes contained in the L e t t e r of Wishes and will therefore r e c o g n i s e the day-to-day instructions of the Client or somebody o perating under the Client's instruction.it is therefore p os si bl e for the Client to give ins tr uctions-inreffect to the Trustees w i t h regard to the allocation and transfer of the property held b y the Trust. Ho w e v e r since the Trustees cann ot legally settle any part of the p r o p e r t y of the Trust on anybody other th an somebody specified as a beneficiary of the T r u s t it is important kt the time of inception of the Tryst that the Client arranges wi th the Settlor that all parties will be named as benefici ar ie s to •the Trust that he can anticipate as people to w h o m he might like to transfer funds at any time in thefuture b o t h before his own demis and subsequent to it. . . . . order to give h i m m a x i m u m flexi bi lit y in this respiect it w o u l d b e usual ^hat one of the beneficiaries u n d e r the Trust wo u l d be specified as anybody, w h e t h e r corporate or individual, w h o w o u l d subscribe $10 to the R ed Cross and w o u l d be able to deliver a ce rtificate of subscription to the Trustees. j. You 6 t a t z d t h a t a t t h z o u t 6 Z t t h z S e ttlo n muJLd d e n o u n c e C - Q .l . , j hJU S lig h t t o change, th e. T A iu tz z 6 and t h a t hz ivouZd A.znouncz i t i n fiavouA. o { th e. C Z izn t. How would a C t i z n t change, the. Tnu6tzz6? WouZd new T fm 6tzz6 o p z h a tz to the. tame. ofu.gA.nat Tn.uu>t P e e d f You 6 cuid t h a t a n y b o d y ca n bzcom z a. b zn z^ ic M u iy cut a n y tim e, b y 6 ub 6 c A ib in g $10 t o th e. Red C /u m and 6 howing a c e A t i ^ i c a t z t o t h a t z ^ z c t t o th e. TA.uu6te.eJ>. I a d o p te.d oa a meA.ru o f c o im u n ic a tio n ? F - Q .2 Aa 1 undeA& tand i t th e. p ro b le m a b o u t the. T/iu&t h o ld in g p tio p eA tieA iA t h a t ciAcum&tanceA c o u ld oaaaz whejie. th e. o m e /i o f a pm opeA ty c o u td be. A u bj& ct t o le .g a l a c t i o n and t h a t a Z t th e. aA&ztA o f th e. TswAt c o u ld be.come. vu ln eA a b le. t o -6ue.fi a .c tio n and t h w i f o K t t h a t i t iA appKopnioXe. t h a t a w h o lly -o w n e d i>ubt>idiaAy s h o u ld b e in6Q A te.d b e tw e e n th e . T fw A t an d th e. p h o p eA ty b ein g acquiA & d. • 14 th iA th e. p r o b le m ? I f i t iA i t huAeZy m u it a p p ly t o c e A ta in o tk e A aA hitA a lA o e . g . a pie.ce. o f m achineA y w h ich c o u ld Xnc.uA a p u b l i c l i a b i l i t y p r o b le m . 1 w o u ld l i k e , t o c l a A i f y th iA q u e A tio n a b i t . F - Q .3 Am I s u g k t i n th in k i n g t h a t i t iA a. w h o lZ y -o m z d 6 u b & id ia A y o f th e. TKuAt t h a t w o u ld a c q u ir e , a p n o p eA ty n a th eA th a n a com pany l i i t z d oa a b z n z f ic M v iy undeA th e. Ttux&t. • Wkat lim its ane then.e on the administnaXLon 6QJwic.z p o ten tia lly pn.ovid.zd. by -the. Tnxutees? F - Q .4 Von. exam ple ., F - Q .5 (i) w ill they $onm Cayman 1Aland companies; (ii) M ill they engage. soliciXoM; [UM m ill they manage the legal gymnatics acquining a phopenty. 1 s my u n d eJ U ta n d in g oj$ t h e tax. i m p l i c a t i o n i n t h e caj>e s e ttlin g on a b en e& icin A y co n A ect? - Q .6 Have you any comment on an the example s e t out in F.(7). F - Q .7 S p ecifica lly i i my statement in the la s t pafia.g>vaph In rela tio n to Bloggs being in bn.each o£ InJLsh low oowiect? F F - q ,8 Am I fujght in undenstanding th a t the Trustees uj>e an investment on. management company to manage the al&ains 0 J th e Tfuist? REPLIES FROM JOHN FURZE TO F-QUESTIONS !L > PLANNING FOR DEATH Pro vided that the Client has arranged that one of the beneficiaries listed in the Trust Deed is an (X) Limited then he can use that company as a c on dui t through which funds could be transferred from the Trust to anybody he wo ul d like for as long as he is alive. Ho wever he might wish to have specific rules adhered to following his death and not to leave the allocation of be n e f i t to be determined by decisions taken after his death and for that reason therefore he would very probably be happier that it w o u l d be possible for h i m to arrange that in the event of his death funds wo u l d be settled in an appropriate w a y on those people that he would like to be b.'.Asficiaries after his death. ■ i zause the Trustees cannot settle m o n e y on anybody w ho is not listed in the Ir u s t Deed as a beneficiary it is of value therefore that at the time of i n c e pt io n of the Trust arrangement in the first place the Client specifies as benefic ia ri es in the Trust Deed anybody w h o m he might ultimately w a nt to be be neficiaries after his death. It seems to me however that he could still do it through Company (X) Limited. H e could specify to the Trustees that in the event of his death a certain amount of m o n e y should be settled in (X) Limited and he could provide instructions to the Directors of (X) Limited w i t h regarjd to h o w those funds w o u l d be al located in the e v e n t . If (X) Limited we re an Irish company or U K company then it seems to me that the s et tling of such money on such a company woul d b e subject to gift tax w i t h i n the rules of the gift tax legislation of these countries and I wonde r therefore w h e t h e r it would be normal that (X) Limited w o u l d be a Cayman Island r e g ist er ed company. ’ xt were a Cayman Island r eg istered company and if such settlement were .arefore free of any tax implications it w o u l d r e ma in -for the Directors of that company to distribute the funds in accordance w i t h the wishes of the Client. It seems to me that the tax implications for the recipients of such m on e y w o u l d b e the same whether the mo n e y w a s settled on them b y the Trust or transferred to t h e m by (X) Limited. I can see h ow ever that the settlement of funds on them by the Trust could b e hidden and not necessarily disclosed by the receipients wh e r e a s the transfer of money b y (X) Limited might create a record of transactions i n the records of (X) Limited w hi c h might prejudice that position. The Client w o u l d have great flexibility in the form of the instruction that he might give to the Trustees w i t h regard to what should h a p pe n in the event of his death. He could for example arrange any of the following in relation to a specific benefic ia ry (i) that an amount of money would be settled on that beneficiary; (ii) t h a t an amount o f money wo u ld be r e t a i n e d and i n v e s t e d f o r t h e b e n e f i t of t h a t b e n e f i c i y on t h e b a s i s t h a t t h e income w o u l d be p a i d t o t h a t b e n e f i c i a r y on an o n g o i n g b a s i s ; /? (iii) that Che money w o u l d be held for the benefit of that beneficiary and that the actual transactions in relation to that money in the event would be done on the instruction of some specified person. If it was intended that there w o u l d be three parties who could give instructions'in relation to the funds in the Trust on the basis of a certain allocation of the overall fund then it would simply be arranged that in the event of the death of the Client each party could give direct instructions to the Trustees. The instructions wo u l d relate only to the propo rt ion of the overall original fund applicable to that person. Ordinarily it wo ul d not be arranged that three new Trust arrangements would be created to reflect this p os i t i o n and it wo u l d be unnecessary to do so. Neither of the three parties w o u l d k no w anyting about the amount of funds i/-vthat had been in the earlier Trust arrangement or w ha t the allocation of the . overall Trust fund-was o n the .death of the the Client. The GMCT'is a legal body which deals w i t h m ul tiple Trust arrangements and it would simply see itself here as dealing w i t h three separate Trust arrangements eventhough it would be guided by one original Letter of Wishes and one Trust Deed. . • If the Client w e re to die and if he had specified that monies would be settled o n certain beneficiaries or that ce rtain beneficiaries wo uld benefit in some w a y from monies h el d by the T r u s t then any one of those beneficiaries wou ld be entitled to see the Trust De ed but w o u l d not be entitled to see the Letter of Wishes. ; Therefore at the time of s et tin g must be anticipated that any one the Client's death would see the important therefore to leave out ,i. % '■■■ out the beneficiaries in the Trust Deed it of those people ultimately benef it tin g after list of beneficiaries. It would be mistresses and such like. The Trust Deed wo u l d not s p ec if y the amount of mon ey that had been transferred to the Trust in the first p l a c e and there wou ld be a record of that only in the Trust a c c o u n t s . . Nobody wo ul d b e entitled to see the Trust a c c o u n t s . . The original Trust Deed and the wishes of the Client expressed either through the Letter of Wishe s or subseq uen tl y wou ld constitute the rules to be ’applied by the Trustees in r el at io n to the particular amount of funds to be managed for the benefit of a particular beneficiary and the Trustees wo u l d simply manage that particular amount in accordance w i t h the instructions given to them either in the fi r s t instance b y the Client or subsequently by such perso n as would b e emp ow ere d to give instructions to the Trustees. It would be possible after the death of the Client that eventhough one beneficiary e.g. a wife, wou ld be a be ne fi c i a r y only in relation to a part of the overall Trust fund that she could specify that any part of her particular proportion could be settled on any oth er beneficiary under the original Trust Deed. G - Q .l Am I riglvt in undzfutanding th a t when th z Tru&t 6 ztttz6 money on an individual on. an zn tity th z individual on. zn tity ijt> 6u.bje.c.t to the tax law6 of the count/uj of residence, of th a t individual on. en tity tliat one apfjropriate to the rzczi.pt of monzy fon non-coYUidznation 06 Mould apply in the. comz of 6zttlem znt from the Tru6t. G - Q .2 Can you t e l l mz about any problem re the iu>e of companies l u t e d a6 be.nzficUafu.e6 to th z Tnm>t cu> a mean6 of conduiXing monzy i.n th z zvznt of death to an intzndzd individual bznzficiary other than tho6e problw6 th a t I have l i f t e d hzrz. G - Q .3 Arz thz ta x imolication6 fon. th z recipient of monies by an indi.vi.dual from th z Tnjx&t whzthzr bzfore th z C liznt'6 death or aftzmmrdA th z 6amz, whzthzr th z monzy come6 from a Tru&t or from a company which would bz a bznzficiary under th z Tmx&t. I f thzy arz th z 6tancUng th a t nobody Ln any (UAc.wn6tanc.Z6 Xm enLLttzd to &zz a copy oi thz Lz&tex otf WXtheA zxczpt th e CLLznt ? G - Q .7 Am I ftLght X.n undeA A tanding t h a t n obody Li a t a n y tXmz and Ln an y cXac unU>tanc.eJ> zntLttzd t o hzz th z T/cait Account&f G - Q.8 In thz zvznt th a t aitzA th z CLLznt'* death thuiz Lt> 6omz bznziLcuaAy uxLth an zntLtlemznt to a pnopontLon oi thz Tmut iund and uUth a sUght to gLvz LmtnuctLoni to thz Tnu&tzzs voLth AzgaAd to th z managemznt oi th a t iuncU, can thatbznziX. no t a x a t i o n o& a n y k in d I n th e. Cayman lila n c L i? - Q.3 Who" ha6 the. a u th o n lty to a p p o in t t h z &upeAv S z c tio n ? H Whznz doz& t h a t awthafiJLty uJLtunatzly come ^Aom? H - q.4 k tiz th z A z d ou ble, t a x a t i o n aAAangem znti b z tw z z n t h z Cayman J tla n cU and jA e la n d on. t h z Cayman l&land& and England? th e /iz afiz c o u ld I o b ta in c o p lz i o£ them? H - Q.5 Can t h z 4 upzA vl& 0Ay o H I cza A& ^zvizd t o I n t h U S z c t i o n t a k z c o p ie s o{ T /u tit docum znti o u t o{ t h z c o n tr o l o i t h z GMCT on hz a llo w zd o n ly to zxam inz them toithZn t h z pA.zcu.nct6 o& GMCT?. REPLIES FROM JOHN FURZE TO H -Q UESTIONS There is a Secrecy Act in the C.I. w it h Trust arrangements and i n d e ed responsibility for s u p ervising the arrangements in the C.I. are s w or n and all officers involved the overall officer w i t h operation of Trust by the Secrecy Act. In practice in the GMCT si t ua ti on only very senior officers have privy to the Trust documents. In the case of a D u b l i n si tu at i o n the only parties who would be aware of a Trust arrangement w o u l d be X ( l ) , X ( 2 ) , JF and perhaps 3 or A of his officers. None of the Trust documents are publ ic documents or are registered anywhere. The m ak in g of arrangements w i t h the Trustees w it h regard to the disposition of funds in the c a s e of the death of a Client can be given effect to w i t h o u t going through a Will w h i c h must be p robated and w ou l d be a public document. Even in the C.I. a Will w o u l d be a registered public document and the tax authority in any p a r t of the world w ou l d be free to look at it. Nobody in Dublin o th er .t h a n the two principals would know about any Trust arrangement and there w o u l d be no record of any kind anywhere in D u b l in or any reference in any correspondence between GMCT and Dublin in relation to any Tr us t arrangement. In order that any interested p a r t y could identify a possible linkage b e t w e e n an individual and a p a r t i c u l a r Trust arrangement it w o u l d be necessary that one o r ot he r of the parties who are aware of this arrangement wo ul d d isclose that or that through detection w o r k or theft or accident that sight w o u l d be obtained either of the Trust Deed or the Letter of Wishes or any other correspondence pertaining to the Tr us t arrangement. If all the money were moved f r o m the Trust at any point in time and if the Client wis h ed to discontinue the operation of the Trust it would be legally possible for h i m to recover the Trust Deed and the Letter of Wishes and any other correspondence and to obtain a certificate from the Trustees that there were no copies anywhere. 9. There are no duplicate copies of Trust documents anywhere outside of the GMCT. C onsideration is b e i n g given to having a set of duplicate copies somewhere but no decision has been reached on it, lA I - Q .l la/hat sanctions oa penalty apply bsiea.chi.ng the SecAecy Act? in the event o someone I - Q.2 An1 I fl i g h t i n th in k in g t h a t i t it> n o t a veAy e l e c t i v e d e te rm e n t i n any cxue because anybody u)ko uiuh&& to tsian&mit in fo r m a tio n co a id do &o anonymously? I - Q.3 A>ie theAe many JsUsh people mptoyed in GMCT? I - Q.4 Am I flig h t in understanding th a t theAe t& no fiecofid ok note, of any kind in A ela tio n to any a&pect o f a T/ujj>t aAAangement in th e of f i ce * i n V u b lin ? J2s Am I rig h t in understanding that the. only people lik e ly to be tr u ly aware o£ a 4pe.cu.6ic. Trust arrangement mould be X (7) and X (2). Am I flig h t i n u n d ersta n d in g t h a t the. Client can a t any s ta g e d e c id e to teA m in a te th e use o f th e Trust arrangem ent and t o r e c o v e r th e Letter o f Wishes and Trust Deed and to o b ta in a c e r t i f i c a t e t h a t there a re no co p ies heZd anywhere? EPLIES F R O M JOHN FURZE TO I-QUESTIONS I discussed with JF various p os si bl e ways in which it could be arranged that sight of either the Trust Deed or the Let t er of Wishes w ou l d not provide clues as to the linkage b e t w e e n the Client and the Trust arrangement. On the basis of my discussion w i t h J F it seems might be possible (i) that the following things If it is correct that any individual could be named as a beneficiary upon s ub sc r ib in g $10 to the Red Cross then at the time of creation of the initial Trust Deed it wou ld be possible to leave out names of any connected parties but still have the o pt io n of p ut ti ng them in later by a r ra ng i ng that they wo u ld subscribe $10 to the Red Cross . This would mean that the p r o b l e m was deferred until a later point but it would b r i n g w i t h it the risk that the Client might die before he gave effect to satisfactory arrangements. (ii) Equally it could be arranged that there could be a list of several (X) companies in the or iginal T r u st Deed and that at a later point each one of these could be assigned to a potential individual b en eficiary and that mo n e y could be settled indirectly on those be.nef iciaries through the (X)-company route. This however wo u ld h a ve the d i fficulty implicit in transferring money from a private company to a shareholder or to an unconnected third party whatever' those difficulties might be. In the case of the company registered in Ireland or the U K there would be tax implications but presumably there would not be if it we re a company regi st er e d in the Cayman Islands. If the Client were to go the route of using a series of (X) companies the onus wo u l d then fall on him to make sure that the officers of those companies w o u l d carry out his instructions with regard to transfer of monies to the intended beneficiaries. Of course the intended beneficiaries could be shareholders or Directors or both. It would be an implication of this that the confidence w h i c h the Client had in the reliability of the Trustees to discharge his wishes after his death would be lost and that he would be substituting for that such confidence as he could have in the officers in the company and perhaps that might not be as good. The Letter of Wishes in the first place might specify that the Trustees should accept the instructions of a partner in a law firm in New Y o r k or in London. A problem arises if such a partner were to die. However this might be covered by h a v i n g it specified that the Trustees should accept the instructions of either of two or three or four persons. They could be different persons in the same law firm or persons from di f fe re nt law firms. If that were to be done the Client wo ul d have to have confidence that the people specified could be relied upon to behave properly and not to give instructions to the Trustees to transfer funds s om ewhere without the Client's authority. In following this route the Client is losing the insurance w h i c h he has that thie Trustees are reliable in relation to acting in accordance w it h the wishes of the Client and that in any case there is insurance cover in relation to potential erratic action on the part of the Trustees.' Perhaps he can satisfy himself that in the case of the persons nominated that he can have total reliability but if there were a doubt about that it could be dealt w it h by arranging that Trustees could only act w h e n an i nstruction from a specified person was confirmed by some other specified person. In this situation the Client could then select two unconnected people e.g. from two different and unrelated law firms and he would therefore cut d ow n sharply whatever probability there might be that one of the nominated persons might give a m is guided or irresponsible i ns truction to the Trustees. If the route were be i ng followed that the Trustees could only act on instructions w h e n they w er e confirmed b y a second party then it wo u l d be n e cessary to have a number of pairs to cover the possibility of somebody dying. j Vera t a l k z d a b o u t in6uA anc.z coueA. I im agine. t f v u it, in su A a n c e t a k z n ouX. by t h z GMCT i n tiztcuLLon t o nuc6appA.opuxiM.on o& t h z Tn.u&t FuncU by a n y o& i t ' 6 o ^ i z z f u - Q.i * RE'^S Am I fU g h t -In th in k in g t h a t no C liz n t would havz any I z g a l azco u uz to GM i n r e la tio n to t h z pn.oc.zzdU, o£ 6uc.h iru>uAjinc.z b u t would &imply bz dzpznding on t h z T r u it aAAangzmznt to o p z n a tz to hi* bznzfiiA i n t h z hamz way a6 i n a l l o th zA cin.cumAtancz6? F R O M JOHN FURZE TO J-QUESTIONS W > PLUSSES (i) Money can be moved, invested or divested from time-to-time simply through a telephone call to a contact operating on behalf of the Trustees. A Bank will not do that without drawing up time-to-time documents of authority. (ii) In theevent of demise it is possible to give effect to the C l ie n t’s wishes without drawing up a will and this is of advantage because a will has to be probated and is a public document and any authority or .tax authority anywhere can go and look at the details of any will whether it be registered in the Cayman Islands or anywhere else. (iii) Because assets held in a Discretionary Trust are legally not at all under the control or ownership of the Client it is therefore factually and legally correct to state that the Client does not own any of the assets held by the Discretionary Trust and is therefore not in breach of exchange control regulations. The Bank in Ireland can swear to the Revenue as to the non-connection in the legal sense between any parties it might be enquiring about and any legal Trust. MINUSES i though many of the footprints can be erased it is still true that a .amber of individuals will k no w who the effective Client is in the case of any Trust. It is always possible therefore that due to error or investigation of a sufficiently thorough kind that the true Client might be identified by an interested party as being connected w i t h a Trust. On the other hand if an Irish individual who held undisclosed funds were to hold them to his own account in an overseas bank then it is much less likely that anybody would learn about the matter eventhough he would be in breach of various Irish l a w s . The problem about a tax official identifying through research or investi ga t i on who the real Client was in the case of any Trust arrangement is not that he can claim that the Client is the owner of the assets in the Trust because he cannot do that because he legally is not the owner, but rather that he knows that the assets of the Trust arose in the first instance through a transfer to the Trust from the Client and he will suspect that the assets in the first instance may have been generated by the Client without paying the appropriate amount of tax and that might lead to an investigation of the Client's affairs of a sufficient degree to track down what the assets might have been. K - q . i I vwuZd Like, to cZaAt^y a b i t &uAtheA ivhat &ofut o& tnaniac.ti.onA a bank voMJL n o t do t h a t the. T/wu>te.eA w t t t do. EPL IE S F R O M JOHN FURZE TO K-QUESTIONS It" NOTE RE IRISH TAX IMPLICATIONS (W 1: NOTE RE IRISH EXCHANGE CONTROL REGULATIONS I2 NOTE RE RICHIE RYAN 1974 ACT (A) IO RISKS I'd FEE 8: COSTS Report No.6/Feb. 1989 INTERNAL AUDIT REPORT 33 . I ?mink? V: GUINNESS MAHON LIMITED DUBLIN [04711] . INTERNAL AUDIT * REPORT "" " ' Introduction We have completed accordance Purpose The of Guinness with our programme and of & Mahon routine Limited in audits. Scope overall internal a review objective controls of the within review the b a n k was for to evaluate adequacy th e and effectiveness. Our audit included together with (1) Foreign (2) Security (3) Credit In a d d i t i o n , other also the we the following related main support Exchange and activities of the ba n k functions: Money Market Trading. Trading Administration reviewed sundry activities cash, of the payroll, bank. computer The Cork s e c u r i t y and office was visited. The b a n k ' s loan portfolio occasion as detailed examination by credit We have in r e c e n t controller also was months t he not reviewed it h a s external been by the auditors us on this subject of and b y t he (London O f f ice ). avoided repetition, the p o i n t s raised by the management letter 12 D e c e m b e r of external as far as auditors 1988. is p o s s i b l e , in their of draft * C. Overall Whilst Conclusions in changes recent within recovered control and the are, which require generally who to the 3 5% the also of the sole charge ac t s , almost based [[ e m p l o y e e good appreciation morale t he little internal had of fraud"! report. associated Board dual so as embarassment the ~ " this in this are and of as are the a Bank Dublin negotiates manages deposits, In this which to a need potential with section report: the risks evaluated loss or other of 1 of Ban k. summary of of ' operational to b e as in risks * under and him conflicts to u n a c c e p t a b l e legal acts transaction serious _ he full-time involves the of evident too, being in d e t a i l against any respect ~ activity which is a b r i e f the related on behalf whilst Bank serious the own without role, matter to c o v e r to t he following Limited to constituting deposits officially, the p a r t i e s exposes There with not not o n l y c r e a t e s this and Director additionally, This dealt with IR£38M the A s s o c i a t e but concern the Ansbacher, These of A n s b a c h e r ‘ of report capacity. behalf of bot h in'teres't" b Ut - a T s o in t h i s of p a r t i c u l a r to n e a r l y Board. check, raised control entirely on his o f G + M. on raised staff issues and "customer" agent acting of of Ansba c h e r Director, a c c o u n t a b i l i t y to a Dublin of in t h a t off-shore Ansbacher, The organisational liabilities. in p r a c t i c e G + M Associate anonymous the major that A matter Bank's with this was been S ' amounting 'I r a t e s We have there management representative if found a number iI based The we attention. Cayman deposits, under Bank, however, relates almost there h a v e disciplines. There us months main issues by (1) The foreign number of exchange functions and money which are market dealers carry incompatible, with out a their i. . .mainstream trading ^'responsibilities Central m include Bank and US reconciliations, access to a major (2) I I trading computer system on the up to three The investment their so as role Loan of the 'items on ■ controls : constraints entered into effect out they are allocate the of this of date done. a conflict prior deals There of interest to the not cheques relating to loans This task should in the allocation. should the be under be performed Section to is Officers by reporting direct Director. Financial Controller certain ensuring and e tc . within that detected.' ma y be always Administration suspense revaluations, or The and a risk Loan In p a r t i c u l a r , and not date. changes . . i1 that to e n c o m p a s s functions. receiving therefore reports not that price issue Managing monitoring \ ! do responsibility. the j time suggested formal The L computer dealers the to are the weeks. of m a t e r i a l We have and be p rev e n t e d contract a p o s s i b i l i t y of (5) 1 the is on other nostro sending transactions therefore to V not their payments nostros, There at more JiV keys. customers authorised • Dollar relative for event (4) test example, effecting irregularity may that for confirmation Security is (3) the activity; the should independent . . monitoring prompt nostro accounts, . These will B an k , particularly preclude improve effective enhanced monitoring of . trading resolution . be . . limits, of outstanding monitoring of FX . supervisory where segregation staff of duties. \ (6 ) A t present the reconciliations I "5^ ^ I nostro are the need established accounts items are a re suspense performed throughout t o be B an k , and and reconciled investigated by various therefore in o r d e r account to resolved spread supervisory controls ensure regularly and and people all that the outstanding promptly. a j (7) Certain procedures need be to tightened (8 ) "in r e s p e c t of established of relating new to in o r d e r staff, of to standard requiring written verification the telex payment improve control. procedures references messages and academic and professional out our should be evidencing qualifications. We would like exception to point basis, and weaknesses only. management effort has within Bank the that therefore Over report highlights is m a d e on an the points the last 12 m o n t h s , gone into improving procedural in g e n e r a l and particularly a of considerable in the controls Banking jf. Department. We would like co-operation to e x p r e s s afforded us our gratitude during the for review. the assistance and Findings, Conclusions and Ansbacher Limited, Grand Ansbacher Limited, a Recommendations Cayma] company based Cayman, deposited, by way call and fixed deposits, equivalent to IR£38M with the Bank These deposits of in G r a n d equate to funds fixed d e p o s i t accounts Deposits") by Dublin-based The accounting ledger maintained the Bank same h a r d w a r e as, but the G + M, Bank's Deposits computer held on the The of System system. is a w a r e of DPC deals that is of, shares the the IBIS/38 Deposits held represented by their controlled the A s s o c i a t e senior the on Customer official names are a Director, of the not h e l d code. We on with the customers deposit on behalf rates payable of on their agents. interest rates with Ansbacher Limited, the Ansbacher interest paid remunerated total not D PC . deposits to on the a g r e e , adjusting by way documentation t h at DPC of We a understand f ee o f a l t h o ugh we this effect. Customer entries that He them. He with G + M Deposits total by to s y s t e m but or with the books the access understand received by Ansbacher do on Operations Bank has interest totals solely, names. call/fixed the and total th e which are System. identified by negotiates, Bank's Deposits independent the the and ("Customer Customer the A n s b a c h e r are operated Customer direct negotiates dealers is no other each deposit also the "Bureau System" Bureau Ansbacher, by (D P C ) a n d that Limited call -r^-\ . Bureau behalf of Thus system s '- lodged on off-shore totally Dublin. Deposits"). customers. on a ia amounts ("Ansbacher Ansbacher records by system of with has ensuring Limited agrees Deposits. If are passed Ansbacher in t h e Limited 1 / 8 % p er a n n um ca l c u l a t e d o n have not seen any le ga l is DPC also receives respect from of Customer i. accounts, Deposits Dublin ara System with In p r a c t i c e Deposits management although he agent of is e m p l o y e d processed by DPC. prepares internal applicable ^ money market I dealer, these the he raises of Ansbacher completes slips the that Bank standard to C al l Deposits. done with and For Ansbacher the deal slips; no sent to A n s b a c h e r Deposits. process no payment effective not DPC not also together check w e a k n e s s For example, so a s credited Call to A n s b a c h e r interest payable on the the on entries and the p a r t i e s There is no with Deposit not a to not to the D PC . agent(s) on on of the the A n s b a c h e r initiate Ansbacher and Deposits serious with c o n t r ol negotiations could a interest surplus Accounts corresponding DPC, payable a b i l i t y to create are respect Limited but certain constitutes to Deposits outgoing payable rate generally Limited, interest the interest easily be manipulated with only with Fixed Bank's interest instructions internal the together n e g o t i ates This the counterparty are but and with both f or b o t h example, confirmations Deposits the initiated controls and Customer a All Limited). received customers, Bank. are etc are the as as activity. noted m e n tioned before, on of A n s b a c h e r accounting confirmations As made is c o n c e r n e d , to n e gotiati n g customers deals then insofar deposits In a d d i t i o n to Ansbacher made The DPC acts Deposits deal within are equation Limited vouchers, also be fact books. i. customer therefore, full-time by to check on his It s h o u l d applied the the in Bank's debiting Ansbacher transactions, input (G + M a n d Ansbacher Customer.and the are in Deposits. officially), relating to in t h e entries Customer transactions parties payments thus maintaining the of The instructions technically off-shore, (but n o t based the p a y m e n t held book-keeping which Bureau processes Deposits. the A n s b a c h e r corresponding the and of over Customer the Call average Deposit Accounts. As the the d e p o s i t s easily be equation Deposit It is vested of balances should be be any the on pointed reason Customer of G review. We have person without Customer out + that to b e l i e v e respect Deposits (and n o t maintenance taken. operation In o u r M, we have coupled nearly with 35% that not serious of o f f - s h o r e Bank's that loss the Customer need of embarassment. to be Bank by subject to These vis a a Bank evaluated by vis are for the activity constitute Bank risks to together the m a i n t e n a n c e employee the in Deposits. this the our involved Deposits expose as Limited any mandates over do However, and Customer control nor any Ansbacher not be e n the A n s b a c h e r Deposits of seen Deposits the been if a n y n e w d e p o s i t s liabilities and position premises may detected the procedures not internal Bank's of legal of the A n s b a c h e r Deposits. records reviewed we have of fact the risks with the lack there has they have Ansbacher the of surplus with neither to A n s b a c h e r Dublin) also the opinion, the Deposits constitute Further, of only, operation detection because i ' opening of new C u stomer Deposits, ,( i n d e e d and maintained. irregularity with j in o n e misappropriated will we have function of and on the Board. I In t he m e a n t i m e , order (i) to the safeguard The site to the Bank's the Customer been away Bureau outside authorised by of the System, documents sho u l d be including and be from the Bank's premises. hardware the shoul d be is n o t Bank's a Managing in the vouchers should it taken Ban k. Deposits accomplished computer terminal measures interests stationery, elsewhere, has the of Ansbacher following relating relocated ensured When this that the ' linked to a ny premises Director. unless duly g/t'C Ideally, no management If, ,/ft and however, employees Customer a c t i n g this G + M Ansbacher the in m a n a g i n g and hence should involved Customer not are The aware Limited, and be former of Grand on as the of those maintaining should their the behalf same the Deposits. then the and in maintaining acting and managing Deposits. customers of be is n o t p r a c t i c a b l e , Limited, for should maintenance Deposits, Ansbacher the employee involved Ansbacher a Bank the ensure that relationship with Cayman. A LJ-- £ (iii ) The Bank mandate to should obtain specifying issue payment from Ansb acher authorised Limited signatories instructions on the a empowered Ansbacher Deposi t s . (iv) Standard controls Deposits and Fixed the Ansbacher applicable Deposits Deposits, generally should unless the also to Call be applied exceptions to are iK duly authorised by a Managing D i r e c t o r . / ' The . . /dealings b e t w e e n A n s b a c h e r [be s e e n to b e o n a n (v) Statements should be arm's of A c c o u n t s sent . Limited and G + M should length basis. relating to Ansbacher to A n s b a c h e r Limited on Deposits a monthly b a si s , h r (vi) To the steps extent should be deposits the that so a s Ansbacher taken not to Deposits account to w e a k e n the form security, separately existing for these qu a l i t y of security. Implementation Response: I- Date: Foreign Exchange Whilst the service dealer while Our 2.1 Bank the participates actively generally limits review Money Market requirements trades trading and effective by by the segregation structure of activities exchange which (ii) Nostro (iii) Control over account reconciliation. Hanover) We the the present recommend should be separation of US follows: dealing functions either from carried the dealing Bank payments telex test there is room and (Manufacturers and that activities so therefore highlighted that between and payment keys. irregularity may detected of d u t i e s ensure Receiving. Dollar room the not messages. system restructured confirmation The (Sterling). Central payment Calculation or of or and Reconciliation Transmission prevented as does are dealer Sending material the d a y office. the de a l i n g Confirmation that exchange positions. in c o n t r o l (i) Under during London to him: (v) foreign overnight reporting (iv) the to incompatible duties foreign personnel markets primarily market square organisation following the spot weaknesses Segregation of the in t h e are prescribed current these customers, maintaining highlighted The of in Dealing a risk not be promptly. and o r ganisation there trading, functions. is a d i s t i n c t accounting, out In order the to ensure following effective changes segregati on of should, inter alja, duties, be considered: (i) The reporting (Aideen line Tierney) of the should FX be support to the clerk Operations I C Manager. (ii) The personnel engaging activity should not: (a) access to have Manufacturers message (b) be t he Hanover in d e a l i n g room telex keys test electronic and payment system, on the sign payment list of p e o p l e documents (e.g. authorised Central to Bank D e b i t s ), (c) be involved outstanding (iii) in p r e p a r i n g items The M a n u f a c t u r e r s system should be on nostro Hanover relocated and controlling reconciliations. electronic out of payments the dealing room. (iv) Discrepancies found confirmations should be reported independent of th e d e a l i n g official Response; in c h e c k i n g incoming to a senior activities, Implementation Date; Revaluation of FX positions / FX positions are weekly as forward losses are to revalued booked The exchange the FX dealer and there We t h at the FX dealer these with least once a which is /•; to However, spot the rates profits/ revaluation essential no prepared by independent revaluation be sources month; is are by independent this in verified rates will ensure computing the of prepared by Financial dealers at objectivity dealing profits. Implementation Reconciliation between and Foreign Exchange It w a s noted column in Report Position' The that should two Currency Positions Revaluation the 'Net 74A did column on reason the that and rates. the should Controller as on a w e e k l y basis. f or of recommend rates. rates verification daily be reports P o s i t i o n at not Report Report agree 13A as at investigated show the with 30 Report 13A 074A Spot the R a t es ' 'Net December in o r d e r same Date; 1 98 8 . to e n s u r e figures. Implementation Date; The'securities government most stocks account is d o n e overall objective in t h e done manage 3.1 four of account major a nominee the Bank company from the The are Bank's (Eblana) short-term a high proportion periods. client by Dealing on benefiting of investment own with the fluctuations trading dealers is also portfolios. Trading board has equity traded equities. Therefore, Limits on The and through market. within commonly trading established and adhered to b y the present there is these limits limits Treasury no for the are g e n e r a l l y Director. independent gilt and being However, monitoring of at the limits. We noted reviews note that and the A s s o c i a t e signs and hence each monitors the trading activity. not necessarily detect Director, internal the Operations investment volume and the contract nature However, this p r oced ure excesses over that Chief the of will authorised limits. We therefore Financial Trading within Response: recommend Controller Limits the should in o r d e r parameters to the monitor ensure prescribed the Security that by Accountant/ t h e y are t h e board.* Implementation D a t e ; At present the IBIS Reports from security We the that that Director the are figures Treasury in calculated/assessed arising as Director reported line w ith by should by IBIS review and the profits/losses the dealers. Implementation Input Our to IBIS review into the input computer settlement The effect may be IBIS We date of reports out for may up not positions are closed. deals input not pos se s s the is forward until the until short and be to date. gilts short is b e c a u s e necessary the are the period. the deal up The the tax on weeks the positions. dates. account input relative sold short, forward the input authority system control preventing creating entered nearer the that not not contract the three This are adjust within to when are override to therefore that the input this practice noted does the in o r d e r the deals clerk the d e a l s system on closed delayed also that withholds transactions Date; system revealed clerk any activity. figures they d o e s 'not r e c e i v e daily profit/loss trading daily profit ensure as on recommend the Treasury the to input of We recommend ensure that that the the p r o c e d u r e deals are should entered be into revised the to system on 4 the contract dates. <■; Implementation Allocation We noted of deals that to customers Under these conflict to customers the dealers deals at do the interests unfavourably prior We recommend that to customers at to not time circumstances of if done. is a p o s s i b i l i t y vary allocation that allocate they are the p r i c e s the time always that there the d e a l e r s the should they At present, deals on weakness in t h e than the the Sheets the dealers each deal duplicated because Deal to customers. allocate are deals done. input may enter sheet. original deal up to three This introduces area in t h a t or m i s s i n g clerks Date; - Dealers operations input of favourably/ Implementation Completion of Date act input is the control risk of increased on photocopies sheets. a days' rather We recommend entered on that only each deal one d a y ’s d e a l s sheet. should Consecutive be lines should 4 be used day and any uncompleted should be ruled sheet on completion. deal off. lines at The dealer the end should of t he sign Implementation Completion of Deal Inpfit c l e r k s evidence We tick that recommend Sheets each the de al that Confirmation" column clerks enter This should will enhance the deal sheet has input the been of ticking to evidence to the i n p ut , a sequential IBIS the qu a l i t y of the to system. "Deal the Deal input Number. audit trail. Implementation Incoming All Brokers deals incoming on referenced. incoming dealers efficacy by of the sheets notes However, contract and are m atched notes are found reported clerks independent with the appropriately discrepancies operations this Date; Contract Notes the deal contract Date: - Operations entry on instead each thus control. in c h e c k i n g direct to t he reducing t he We recommend instructed checking that to the refer incoming Director, operations all clerks discrepancies contract notes to found be in the A s s o c i a t e Operations. Implementation Response: 3.8 should IBIS-generated At present, notes We two (held be rather than files in d ea l recommend should Contract that filed a in Notes of IBIS-generated number sequence) second copy of the Date relevant in s e q u e n t i a l contract are maintained. the contract Brokers' notes files, order. Implementation Response; Date; B r o k e r s ' Commissions At present, reviewed by We recommend at least the Brokers' the A s s o ci at e that quarterly such a rather commissions Director review than are twice should be analysed and a year. carried six-monthly. out Review and Reconciliation of Bargains Report Although we Bargains Report accounts, We and the the do not be appear the evidenced and that individual to be at Unsettled weekly brokers monthly. Date: Implementation Response; Banking Department 4 .1 Issue of Cheques A number of Department, with cheques which on loan drawdowns Officers cheques issue loose should relating of cheques department Officers, or not to We loans should is kept able be under the the used consider separate to in are be p ermitted section, which are occasions etc. is evidenced. least individual it brokers the Brokers evidenced against be the review of should B r o k e r s ' Unsettled reviewed against the check should that regularly checks that Report accounts is checked Bargains that advised these recommend Unsettled t are periodically Brokers' to in c o n n e c t i o n that issue their Banking Loan and control. responsibility from verify sign the The of a Loan independently that the payment is documentation the case of correctly authorised, and security has loan drawdowns, have been Loan Administration Henry, met. This reporting the may be Section direct been the necessary completed conditions by a status to the Managing in precedent achieved formal and, according under the Jim Director. Implementation Date: fa vo * Out-of-Order Account The complete out-of-order the computer is o n l y p r i n t e d our review and covered excessive the number December. well should be we corrective action has present the t ha n one the day monthly it w i l l at not time of This interest of is p r o d u c e d become Whilst this list additional that by 72 pages end any taken, is controls necessary because out-of-order be h i g h l i g h t e d is p r i n t e d . the have indeed b een remains by the list that to e n s u r e account list customers. day. consider introduced if 200 At comprised accounts the previous controlled, list a daily whose produced monthly. to a c c o u n t s In a d d i t i o n out-of-order list is p a r t l y e x p l a i n e d applied customers account recent approximately having been showing most List for again at more until We recommend that new out-of should , that the list order continue should be positions to a p p e a r on redesigned remaining so irregular t h e d a i ly ' jList u n t i l the * '■ monthly should list is p r i n t e d . maintain which should d a lly lis t- Alternatively, running be records reviewed of in the the reviewer irregular accounts same manner as the j j y Reponse; Implementation Date; < n 4 .3 Diary We Record are Cards pleased system has Department to been note that introduced and is nearing a big advance, we consider could be more undertaken, f or We the person such a way that of For interest, usually requested of card the and numbers should be securities commission at a given or might some of the being a cards be be completed kept should financial also to r e c o r d of, received or date. the to make to a information is contact The action f or the in indicate how include record note task. necessity should is to be can c a r r y out the this cards reminder the should the task and addresses. used form a permanent guarantee that that files commission telephone should Whilst cards example, names, the completion. other personnel to card Banking just need and diary the regarding than the reference minimum. within usually performing that in case further the rather recommend task explicit a central reverse taken example, value of and In o r d e r we ' \ to enclose, subject, further as illustrate A p p e n d i x A, together with this recommendation, further examples of Response: notes on the diary record cards. Implementation Date: j-'l - 4.4 Procedures We note Manual that • - Banking various in A n d y O ' D o n n e l l ' s 1 98 7 , were during We revised procedures, in the Banking set out Department there are further plans 1988. that existing procedures revised procedures agree as 8th December memorandum dated introduced understand the Department with the approa ch and move to be agreed towards recommend s h o u l d be p r o d u c e d in d e t a i l for that the and and f or set out new and implemented. a properly a users to We structured procedures manual Department. Response: Implementation Date: pl/L. Q l K 5. Control over telex payment messages Our review of control over the following matters where procedures order to improve control: telex payment messages should be highlighted enhanced in Test Key Arrangements 5.1.1. The custodian provided access with to from 5.1.2 are register prepared. t he those It should should be number staff be of excluded out to ensure a variable that number by the G + M keys are easy test key to c r a c k insecure. key arrangements should be detail: Name and test number least once number should with be was last ensured each party changed that the is c h a n g e d at a year. The members of calculating and instructed Answerback key it fixed not staff telex messages. destroyed. to w rite up All test tests for should test number calculations key be the calcul a t i o n s the Otherwise, s e c r e c y of compromised. responsible decoding components making the should with authorised list room potentially test Thereafter, 5.1.4. The carried of Telex Number Date be replaced therefore Customer keys. without system because A tables l is t . component 5.1.3. key of people the deal i n g test keys and test list test A review should all the to a m i n i m u m p o s s i b l e with the a the restricted people, of there is numbers on must a risk will be and copy be that 5.2 Reconciliation with Nostro Transfers In o r d e r to ensure messages have accounting should that transmitted payment been duly processed records, agree all all the nostro copy payment Manufacturer's Hanover nostro movements. account system, the reconciliation messages etc) Response; 5.3 through to clerk (telex, the respective Implementation Date: Security of Telex Equipment The telex and readily accessible. desirable machine if the is located machine in an o p e n p l a n It w o u l d was therefore protected office be by password control. Alternatively, machine the at measures close day when the should of b u s i n e s s machine be and taken to at p e r i o d s is u n a t t e n d e d . secure during the Nostro Reconciliations 6.1 i Although Mahon's most accounts reconciled & Mahon's London weeks of the with regularly, sterling had and nostro at fully the unreconciled balance advised a that banks) we were account not been that other accounts have been concerned that with Guinness reconciled time of exceeded full (Guinness our Guinness Mahon, f or several review the £300,000. reconciliation & We w ere is o n l y also conducted monthly. As this is o n e we consider basis. that the it Otherwise detected be of by should errors promptly incurred two most be active reconciled (or e v e n on accounts a daily may interest not be costs Implementation Segregation of The Duties reconciliation nostro account currently Murray. carried The conducted by Laura room Foreign Exchange Settlement is also the above-mentioned Guinness out and b y by the Costello, Eileen Dealing Account is Date: - Reconciliations Mahon, Chief reco nciliatio n of dealing who of with may Bank. Response: 6.2 fraud) and unnecessary the nostro K an e , Sundries reconciled in t h e d e a l i n g Dealer, the who r oo m . London sterling is David IR£ ac c o u n t s is the a dealer in cashier. is the The Counterparty by Aideen Tierney, It is important by persons involved that nostro independent in therefore effecting recommend rearranged of are the d e a l e r s and that accounts receiving reconciled and those payments. We 4 the d u t i e s shduld accordingly. Implementation Control The over nostro reconciliations throughout Associate Director, is account no with with recent control in that that of Royal The Bank In a examination out. are performed Bank of of and p r o m p t various Canada, the examination, cases, Cork to such and we as the the CAN$ found that a reconciliation had been examination a senior few Ireland, by forwarded for h i s very is a n member the o u t s t a n d i n g investigated and Operations Bank the carried ensure the evidenced. IR£ account Date; Reconciliations personnel which ■ be of items important staff are corrective quality should being properly action is b e i n g taken. In o r d e r to ensure conducted a senior all date the at regular person, nostro should that we accounts reconciliations intervals recommend should be placed reconciliation all is and that being signed each off as being examined a control be maintained against are and account list of that a name examined. by when The '■ Bank maintains banks. Whilst possible most of reduce several Dollar, and that two Francs We five each and the Deutsche accounts the of by and other it m a y b e closing to a few there being IR£ accounts, accounts Canadian are we maintained Dollars, Swiss Dollars. feasibility should be of closing some of considered. Reponse; 7. with needed, in a d d i t i o n Marks case Australian that are £ sterling in t h e recommend accounts administration In p ar t i c u l a r , US forty these accounts. note i§ M to nearly Implementation Date; Suspense Accounts Suspense Accounts provide costs an need opportunity to be h i d d e n . Controls Following balances to p r e v e n t over the responsibility controlled they expenses and to be debits. the A c c o u n t s recent personnel for each the b a l a n c e s of w a y as (section recommend that changes, suspense reconciliation accounts as require unauthorised We same losses, also clearly defined. in the Response; closely for u n a l l o c a t e d Credit carefully controlled 7.1 to be account that to be the should recommended needs be for controlled nostro 6.3). Implementation Date; The 7.2 We Need for consider reduce might and be We by we that the an opportunity risks the accounts of be account consider a to Bank and should cleared suspense by entries and item (Section 14.6 nostro account to, shows an should used). Implementation The Role of The Bank has may be d e s i r a b l e encompass be accounts allocati on of an Response: 8. to might use direct them consideration accounts a nostro where the Entries over suspense recommend avoided of and of any and may be to whether example, example be there number to whether closed ft*. J the them. given for that administration reducing over the A c c o u n t s the Financial recently certain for Controller recruited the Date: Bank independent a Financial Controller. to enhance his monitoring role so as It to functions: V- / (i) Monitoring related (ii) of to c r e d i t Ensuring regular resolution of suspense (iii) trading limits other than those risk. reconciliation items outstanding and prompt on nostro and accounts. Review of revaluations of foreign exchange security positions. (iv) Monthly monitoring of bro ker s' commissions. and (v) Monitoring of The^.e Ansbacher functions will bank particularly preclude and Deposits improve in the effective reporting on and where segretation of controls staff of fee. within the constraints incompatible Response: 9. profitability calculation supervisory areas the duties. Implementation Date Cashier 9.1 Control A cash over count balances In a are to be small through their till or sickness. are to with her and well the of at when the Other records access is balances ledger usual cashier the The B ank h o w e v e r , the £15,770. each not p r a c t i c a l visit were kept. and p r o h i b i t i o n reconcile our The of such as manually kept controls having to time till of holidays dependant under her and that upon the control the computer place when a e a c h d ay . Although independent difference external cash longer held. organisation many others, between no during IR£15,234 and accurate by records conducted segregation, own cashier was held were currencies found Cash counts is r e p o r t e d auditors, such should long checks. be or at least o nce should be evidenced. when visits periods We counted by random take of therefore an a month are time may recommend independent and made that the by the elapse that person check at the stocks be should detected. counted once and be controlled We recommend substantiated a month by a person usually maintains the and that that with the the other any than loss stock should should records at be least the p erson who records. Implementation Reponse; Date: V 10.2 Policy Regarding At the time travellers had that Deutsche our review regarding there Marks, were cheques. travellers cheques We is the 1988 recommend retail and a the in it its above-mentioned French and replacement. the last and case We s h o u l d be the in Dollar of Franc Swiss in M a r c h in 19 8 5 . new policy considered to h o l d also Canadian transaction was one Franc no decision few t r a n s a c t i o n s v i e w of requirement of exhausted Francs In stock the previous that banking, still the very Swiss travellers October Held cheques had been been made noted Response: of Stocks regarding whether travellers there cheques in currencies. Implementation Date: 11.1 * Keyholders An 'A' gain as , and a access 'B' to keyholder the are currently strongroom and the Niall Padraig Anna Marie Ryan Margetson is strongroom Tierney. Ryan with All either area access recommend that that able Marie three are effective of McKiernan the Collery access McKiernan in Bank. through Ryan Tierney to g a i n employed control Niall Padraig Collery Aideen therefore Administration should to the or A i d e e n the Treasury In o r d e r to ensure segregation we be should be Response; a 'B' keyholder an 'A' keyholder. Implementation The previously been Department security evening and we strongroom. should in disaster, be kept it, both subject recommended register note However, not be recorded will Date: Security Register It h a s each are B Chris Waite Niall 11.2 keyholders to follows: A and required the same in cas e register to the it is consider in t he because should be that we same that and the locked now kept that the l o c a t i o n as of the risk. Banking fire or away in the register the items other recorded items We therefore location recommend should be that found an alter n a t i v e f or the secure register. 4 R 12. e s p o n s e I m p l e m e n t a t i o n Date Personnel 12.1 References We on new Personnel understand that new personnel not of always the Mahon a written the fidelity of the staff any time references are made always conversations. We are advised by Insurance for Services all insurance new We staff taken, qualifications of taking of is a c o n d i t i o n in r e s p e c t recommend in a d d i t i o n telephone. that the arranges therefore be by ensured that that he should obtained it s h o u l d b e on not in D u b l i n . references written references are references professional file telephone notes reference of written obtained, taken and telephone Guinness Response; are although At the any academic new staff are that to same and verified Implementation Date; 12.2 H o lid a y s It is also fidelity ten condition of insurance consecutive Although this a the that working officers requirement and handbook, we personnel changes, in it understand the above-mentioned staff days members holiday Dublin is are included that during it m a y n o t h a v e {fake a t each well in year. aware the 1988, been least of staff due to strictly . enforced. We the Response; recommend attention that this of t h e requirement staff and should enforced be drawn during Implementation to 1989. Date: We r e c o m m e n d written reminders , loans * understood these Response: that periodically/ in defa ult that should be to e n s u r e it is the sent that Bank's s u i t a b l y worded, to al l it is ex staff with c?learly intention to collect loans. Implementation Date; 14. Cork Branch 14.'1 Loan Documentation '■ 4 We examined procedures the question of for C o r k involved, consider B r a n c h and, them to be satisfactory. However, are o n the maintained documentation relating that the although loans and copies We other are not recommend legal security given its the own is always placed on facility m e m o r a n d u m of d e p o s i t , agreements, etc in o r d e r to maintain a complete safeguard against l os s of the At and Terminal present access Cork file. important letters, the record customer and be obtain access out their capability certain allow desirable also as a originals. we the ability maintained that Cork to D u b l i n ' s shou ld be other them staff have duties, file Date; Facilities accounts it m a y to strongroom, Implementation Computer note charges, on Response: 14.2 all the We customer of be p l a c e d keeps relating in a the guarantees, should Cork records customers. kept signed copies such as risks accounting documentation facilities documentation the Dublin computer, to disaster generally whilst original that and with staff accounts consider that restricted accounts, to operate. input Whilst are to able in o r d e r their it to Dublin. to Cork for w h i c h to is to carry input customers and necessary to 14.3 ......j Facsimile Payment Cork Branch send payment messages Instructions now has fax contain a test which guard f r a ud . against the machine instructions fixed number, purposes a number is to key a We which Dublin be to includes a designed that changed uses these This code recommend should and number. secret it for at to security least s ix monthly. Response; 14.4 Implementation Tested Cork to Telexes Branch London sends after from Dublin by message. its own improve Response: sent We telex Date: to London tested payment first h a v i n g telephone, recommend testing obtained which that instructions Cork it a test includes Branch arrangements direct number in t h e should have with London to security. Implementation D a t e : Customers Account Statements i Customers' prepared statements in Dublin, are subsequent mailing that additional as an passed to the maintained to the the monitor his at Cork being is now returning control holders to Cork customer. statements f or all should be Branch t h e m to the Cork accounts In o r d e r direct to in c o n t i n u i n g consideration might to being despatched being be to conducted by given to paid f or retention, Branch usual practice for recommend entries from Dublin. forwarded Branch the transactions the more We although over Branch the business cheques the Manager of Cork customers, which to accounts, forwarded accounts, account assist for c u r r e n t rather than account holder. Implementation Date: Cork Suspense Account/Fixed Deposit Accounts Maturing fixed deposits Suspense Account instructions such a re rollovers We recommend be passed account. account is credited to then debited received. There are the Cork again about when new 25-30 each week. that over which are where possible the c u s t o m e r ' s Alternatively, s h o u l d be used. a these call specific items deposit or should current counterparty 14.7 Outstanding Drafts Cork The balance issued by still We we recommend months account debit over which entries 1979 w h i c h six that most of by two be additional of not been drafts old, are to a known to solicitors. for m o r e controls than separate regarding are placed. Implementation Response: 14.8 years firms transferred of d r a f t s these them outstanding up have of over drafts should made are are h e l d that is Thirty one IR£28,215) and account since understand exist twelve Branch for p a y m e n t . value although the a b o v e Cork presented (total of Date: Travellers Cheque Stocks Stocks of Francs, Cork Deutsche Branch check number of visit. the stocks and the of figures, by travellers Marks are stocks incorrect e tc , until should and be in U S against this ledger brought corrected travellers it controlled are at cheques is and ledger. revealed at Our a forward the are any time of our not paid important that French maintained in a m a n u a l postings, issued, Dollars, Sterling recorded which were Although Bank cheques that loss for the should We recommend that substantiated by a person maintains Response; with other the the the than stock should be records at counted least the p e r s o n w h o once and a month usually records. Implementation Date APPENDIX I DIARY RECORD CARDS T h e s e caxfds a r e c o m p l e t e d f r o m i n f o r m a t i o n c o n t a i n e d i n t h e d o c u m e n t a t i o n w h e n t h e f a c i l i t y is f i r s t a g r e e d w i t h t h e c u s t o m e r a n d a m e n d e d a n d a d d e d t o a s a n d w h e n n e c e s s a r y d u r i n g t h e l i f e of the f acility. 1. INTEREST RATE FIXING Th i s c a r d s h o u l d be c o m p l e t e d for all a c c o u n t s o n w h i c h there is a f l o a t i n g i n t e r e s t r a t e a n d f i l e d i n c h r o n o l o g i c a l o r d e r in t he d i a r y c a r d b o x for the n ext date of a c t ion . The card s h o u l d c o n t a i n a l l t h e i n f o r m a t i o n n e c e s s a r y to c o m p l e t e the in t e r e s t r a t e f i x i n g in c o n j u n c t i o n w i t h the d e a l e r s . Q.. The d a t e for a c t i o n s h o u l d be at least 2 b u s i n e s s d a y s b e f o r e t h e r a t e f i x i n g is d u e . It s h o u l d b e n o t e d t h a t c u r r e n c y loans a r e f i x e d two b u s i n e s s d a y s b e f o r e the e f f e c t i v e date. It m a y b e d e s i r a b l e t o f i l e e a r l i e r if it is n e c e s s a r y to c o n t a c t t h e b o r r o w e r to a s c e r t a i n the n e x t i n t e r e s t p e r i o d selected. A r e c o r d of the r a t e s fixed s h o u l d b e k e p t o n the r e v e r s e o f t h e c a r d . ( E x a m p l e s 1) . COMMISSION COLLECTION T h i s c a r d is u s e d t o m o n i t o r t h e c o l l e c t i o n o f c o m m i s s i o n s p a y a b l e t o t h e B a n k for e x a m p l e : Guarantee Commission Commitment Commission Management Fees/Other Flat all Fees Th e c a r d s s h o u l d be filed in the d i a r y ca r d b o x in c h r o n o l o g i c a l o r d e r f o r t h e d a t e o n w h i c h a c t i o n is n e x t due. T h i s m a y b e b e f o r e t h e d u e d a t e if it is n e c e s s a r y to re q ue st p a y m e n t in a d v an ce. A record of commissio ns r e q u e s t e d a n d r e c e i v e d is k e p t o n t h e r e v e r s e o f t h e c a r d . ( E x a m p l e s 2) . FINANCIAL INFORMATION T h i s c a r d is u s e d t o m o n i t o r information and certificates facility. For example: the col l e c t i o n of financial r e q u i r e d d u r i n g t h e life of the Annual Accounts of Borrower/Obligor and Guarantor(s) Interim Accounts of Borrower/Obligor and Guarantor(s) O t h e r s t a t e m e n t s f r o m B o r r o w e r / O b l i g o r a n d G u a r a n t o r ( s ) such as o t h e r f i n a n c i a l inf o r m a t i o n , c e r t i f ica tes , statist ics , r e p o r t s e t c c a l l e d f o r in a g r e e m e n t . The a g r e e m e n t o f t e n s p e c i f i e s the d a t e b y w h i c h i n f o r m a t i o n is r e q u i r e d a n d t h i s s h o u l d b e r e c o r d e d o n t h e d a t a m o n i t o r i n g card. i . It is u s u a l t o o b t a i n t h e a n n u a l a u d i t e d a c c o u n t s f o r a l l corporate borrowers/obligors/guarantors regardless of whether t h i s is s p e c i f i e d in t h e a g r e e m e n t . The c ards s h o u l d be filed in the d i a r y c a r d b o x in c h r o n o l o g i c a l o r d e r f o r t h e d a t e u p o n w h i c h a c t i o n is n e x t due. W h e n i n f o r m a t i o n r e q u e s t e d is a w a i t e d t h e c a r d s h o u l d be filed for a few da y s forw ard w i t h a p e n c i l n o t e i n d i c a t i n g the situation. A l l data r e c e i v e d s h oul d be r e c o r d e d o n the card and g iv en to the relative loan officer R e cen t f i n a n c i a l r e p o r t s shoul d be f i l e d o n f i l e . ( E x a m p l e 3) MONITORING r e v e r s e o f the for act ion . the customer CARD T h i s c a r d is u s e d already covered. to moni t o r all For example: other action required not Collection of interest (arrange c o llection and e nsure r e c e i p t ). Receipt pf repayments R e c e i p t o f m o n i e s a s s i g n e d t o b a n k (eg c h a r t e r h i r e s ) V a l u a t i o n s o f S e c u r i t y (eg s h a r e s a n d o t h e r t a n g i b l e a s s e t s h e l d as s e c u r i t y ) Insurance Renewals/Payment of Premium a f f e c t i n g the bank's s e c u r i t y (eg l i f e p r e m i u m s , f i r e i n s u r a n c e f o r p r o p e r t i e s a n d s h i p p i n g i n s u r a n c e s - ma ri n e risks, w a r risks, P&I, mortgagees interest) T h e a b o v e l i s t is i n t e n d e d a s a g e n e r a l g u i d e a n d is n o t exhaustive. T h e d o c u m e n t a t i o n s h o u l d be s c a n n e d to e n s u r e that n o t h i n g that s h oul d be d i a r i s e d for a c t i o n d u r i n g the life of t h e f a c i l i t y has b e e n o v e r l o o k e d . The cards should be chronological order due. f i l e d in t h e d i a r y c a r d for t h e d a t e u p o n w h i c h b o x in action is next W h e r e a r e q u e s t h a s b e e n m a d e (f or e x a m p l e f o r i n t e r e s t ) a n d r e c e i p t is a w a i t e d t h e c a r d s h o u l d b e r e - f i l e d t o m o n i t o r receipt. T h e b a c k o f t he c a r d s h o u l d b e u s e d t o i n d i c a t e w h a t h a s b e e n r e q u e s t e d a n d w h e n r e c e i v e d . ( E x a m p l e s 4) FROM as TO 1 3 37 I 8 ** RATE 6 ( C o n p U k t (ra%tS alrove B u i h n t , 10 8 l6o*) GM PARTN J , 70I 1 0 0 ,0 0 0 I O 0 V0 REMARKS Ffr P A £ n ic* Co. i.V D . f o a T h £ « 7.1 n ‘ r u e AMOUNT OF FACILITY J l S o, 00 o •lo Tfl rl . Vrt C Fat P£c £nQE4 SPECIAL TERMS RELATING COMM ISSION AMOUNT OF FACILITY G uAAAnf^e PS/t iW u f l fl^rMAt-t-Y TO X r.JsO 'C o o BaJk Of l4£lAJj) D£8it Ho. P ataka iHiP Th£ j L OA N G U A R A N T E E D ; C O N T A C T FOR F I N A N C I A L !i in fo r m a tio n •> 1 A N Y RA TI OS C A L L E D L.TD O A T A M O N IT O R I N G CARD PLC SuPfftio/* BY CO. i ... tcl. otfl 7 6 ^ S C£LitJ£ O-Retuty --•------— FOR U N D E R j L OA N A G R E E M E N T D A T E O 1 Xr LOAN A M O U N T OOO VffTii. F'JR.ThS* r*tTic£ EXPIRING A N N U A L RE VI EW D A T E 31 ■fj NAME OF ’ 2.V B/S AS A T (ftl (JUAATfAtr - £H0 • G U AR AN TO R : . OTHER STATEM ENTS Aijr OP CNri«r£AHiA^ Mrt/tCH ^ , SEPT- ir " i t C , DAYS GRACE DATE DATE PER TERM S REQUIRED BY RECEIVED ■ , /S J l f . f)T 3 1 • ; C-i.o6C Tfin ^ E l t-on-J O M A ilh li/ W ltC -i , / . i . ! ’ !.'•■: ■.•••■• 182 1^2 60 01 cm I ' l l WON (>1*1 R A T I O N TO III U. ETTEA I’ H O C f O U H L S C -'H H IIU OUT TbJo U££K5 Id Gi I N K UN/.; lU V lli-. fi£q£C M OUT JoH fJ flflc < /» * «• < u0 itAli kOArJ IS S -U O I-e l C A H D FOR M O N IT O R IN G IN TE R N A L rjS’lol'IO N O N - C R E D I T R E V IE W P R O C E D U R E S ------------- - t e l ----------------- 0 3 / 7S •a o 0 ° 3 O C T A I I S OF O P E R A T I O N T O Of C A R R I E D O U T CrfSt*. BoTh S E c u A iT f V A i< JA T i* rJS . AOArJi S a /t flA A iir l, lo c / a ttA A C fJ A £ q < i.A £ 0 JF fit.** Ir J o*te SToC*. JohW 0*oW rf-l g»aaaj~ec> S h A A E i S a P f t A T i.a A « t To A O C U T> . MS' But At/iAie /aiiTurJ J « n ' ( Mahon Cayman Trust Ltd. (incorporated in the Cayman Islands) Guinness & Mahon Jersey Trust Ltd. (incorporated in Jersey) Guinness & Mahon Channel Islands Ltd. (incorporated in Guernsey) . The directors of the bank were initially, reluctant to give information about the activities of these companies to the Central Bank because of fears that the information might be conveyed to the Revenue Authorities^ With regard i^to cases where leans by Guinness & Mahon (Dublin) were secured by .complex back to back nrr«npm«ni-ii of deposits in these companies, we were given eight of copy security tocuraents but were requested not to note the names in which the deposits were held. This we agreed to do. No files or records relating to customer transactions with these companies are retained in Dublin. The bank-fears that the retention of such files would give grounds to the Revenge to claim that the companies are managed by Dublin and also individual files might come into the hands of the Revenue Authorities. The largest of the three companies is Guinness & Mahon Cayman Trust Limited (G.M.C.T.). This company, which is registered in the Cayman Islands,.was set up in 1971. Initially, it operated on a 'B1 banking licence which restricted its activities to offshore business. In 1973, an 'A' licence was obtained which allowed the company to carry on full banking business. The licence costs £10,000 per annum. The directors of the bank are John Collins and J. Furze (both British) and a Frenchman. Mr. Traynor.and Mr. Guinness resigned as directors following the decision in the Clinch Case in England where a director of a company registered in che Cayman Islands who is resident in the U.K. was held to be an accountable person to the Revenue Authorities on the activities of the Cayman company. • The function of the Cayman company is summarised briefly as follows:(1) Prior to 22 June 1972 when the Cayman Islands ceased to be part of the Scheduled Territories, Guinness & Mahon (Dublin) arranged for the transfer of funds to a Cayman registered discretionary trust of which Guinness & Mahon (Cayman) was the trustee. The use of the trust funds was totally at the discretion of the trustees (G.H.C.T.). A Cayman company was formed which was controlled by the trust and A deposit placed in the Cayman bank in the name of the Cayman Company. The customer in Dublin, whose funds had been transferred, would then apply to the Dublin bank for a loan equal to the funds deposited by the Cayman company. Before the loan was advanced the Cayman company signed an Appendixm?) -- tfotf ««d« 12311 GUIMHESS MAHOH CATKAfl TRUST L •• V*>.' MW 774 J,50CU<3 1 2 ,7 0 6 $ . P.TO7 77T ?N0V 774 P-WV1174 NOV1274 NOV1274 NOV1274 9M0V1274 X0V1274 *«IV1274 9WIV1274 PER J5 RE EOUINOX TOREV LODGED JIE J A F <0Vl374 9WV1374 V/D V/D NUV1474 MV 14*74 . NOV14*74 :, * * uV1474 40V 1874 40V 1874 •«W18V4 ' 40V1874 .40V1874 »V 1874 10V1874 WOV1874 .«JV 1874 '<1211174 fMT PER per PER FROM 7/ t o m S am A/Z! MM r 30/9/7* 295J5 TRANSFER omovnl ACCtUtD t2,70627 • 12,70627 • 177,2 (radilbotooc. limit (2) *mno £3,405.*; * 41.! 4,079.5 59.9 f 4,079.) 62.3 ^4,079.9 £6,925.74 • 63 J f7.2H.f2 • 63.1 A 4,079.9 £7,957.19 • 64 .6 1 4,0793 14,7$%% * 66.4 ^4,079^ M ill dola/t> C IIO II '300.00 '163 .llo ^ 615.06s, '5000 '4,215141 ■ ■'1,054.51 -700j00v. "■ •1,750.00s %11QJOO -300j006 ••»v -500j00k . •750XX> .500.001. • 600.00V .r -..v 500.00 10V2074 rnSFO FROM C .H .C .T ; H .J .K 0 CXT CALL OJ/A '{3121 74 CASH TO A.f«6«0UM0ALK OV2l'/4 REV OF EMTRY I12,71W< • £I2;913M • J27> 133.n 4,ft7>.W £425*5* • 155.9' 4,079.! 141,421 4,079.94] *S30u80 12449 258.99 105.53 17357 ir m o t l cm commmton cm IM* to IUndM Tho S o c r o ta r y , Guinness Mahon Cayaan T ru st L td ., P.O. Dox 887, Grand C aynan, BRITISH WEST 1KD1ES. _______________________________ V SKXtlNG CMDlf NOUS No A u t h o r i t y t o iiupply in fo rm , o v e r phono o r to a u d i t o r * . n o te H'£ f ix o d . I n t . q r t . on 3 1 * t March fe :i3Mt Doc. onch y o * r . In to ro M t r n to fjiiotod to r u n a ln u n l o N N to h onr to th o c o n tr a r y ro p a y a b lo In IrlM h V * T h in a c c o u n t 1« Non R o n ld o n t nnd d e t a i l * o t I n t . In n o t t h o r o l o r o to d lk c lo tfo to th o Rov. A u t h o r lt io n K ntrloM to t h i n a c c o u n t a u n t M ill . (dAlWmi l« lo4yr»nt cb dxqw«bo<4. 70.61 A 4,07934 £1%713.5< • '200.00 PER P D/A TSFO PER 8/C >ER B/F >ER A/0 tn IntMMi 4,079.J '300-00 TSFO FROM A/R I TSFO FROM S/G EQUITY . • ' > : M * 3 0 .9 .7 * PER r . r '/ .D . 3 0 .9 .7 * CASH JANKERS PAYMENT TO Y.D . 3 0 .9 .7 * PER Z 1 * , . 0 . 3 0 .9 .7 * PER A/U . 0 . 3 0 .9 .7 * PER K ' : M * 3 0 .9 .7 * PER Y 1 * / .D . 3 0 .9 .7 * PER O.E J.O . 3 0 .9 .7 * CASH . »l»AC* 59.59 15rtjOO '108.75 z m jix 3 0 /9 /7 * tod* AlCftUfD ilimH ■ PER V3 Ml 2574 Ml 2574 4012574 MSI 2574 OfM -700/9 TO 7 / 1 !/7* . ifabil* a w ownt 1J>0 .000 d o ll W U ,7< i mt- f f.QH y/ fo/ y k t m t J / r m TEftEST TO J1jEC9o ! 3iDcCyoi II.TcFEST TC CREDIT DEWT V I, 2CA . 2C C3JAN94 03JA N9e 03J a NV o 13F£eVo 1/051.15 21,953.15 41, Q94. G1 46,207.89 i!f>,122.SO 35.00 31MAS96 27“* Y ye 30JoNy6 25JuLVft. 25Sc PVa 30SEF96 3iui C9o. 1,250.00 ! S s a C -'s 5 *05.72 1,2 5 u .0 C j 3 n 7 .00 1 26,000.00 37*..53 16.70 2 *i, 528.67 27.778.67 25.165.67 ’f , 915.67 915.67 1,290.20 1,303.90 OVERDRAW N BALANCES ARE M ARKEO DR IN TH E EVENT O f QUERIES PLEASE WHITE T O OUR INTERNAL A U O IT DEPARTMENT a k s ta te m e n td a te 2 7F £3 V7 DETAILS OATS *>* : 000 Pi m ( ( . ‘ YKAMJ l TC’ rEF : urtr1* n L ATTN n-. M ICnAcL OAY PL' =0 a o £7, o h AND CAYMAN CAYrA.-, I5(.A:.0i /goo/T m not* that cradlla r i c i lwi i i l H f A t ANSBACHER (C a y m a n ) LTD KE F: Gf»P-Kj ATTN MR (i ICHAEL LlAY PO 3QX 647* vjRANu CAYrSA.N CAYMAN ISLANDS a /C: 0 2/ 0 1 0 S 7 / a i IRISH INTERCONTINENTAL BANK LTD 91 Menion Square Dublin 2. Telephone: (01)6619744 Telex: 33322 Facsimile: (01)6785034 m u Bp UEP CL OtH fiON H i ; ** PAGE Nu: OATE A r: C h I V £ CjPY as S TA TE M E N T O A TE: 0U0 OfTAILS :05A PR?5 bnOuGaT FC^«Ar\L> : 0oAPR95 R i jT 156 71 7 * IThi)F: AtfAL Rt wT lb671i wIThuRAWAL luA PR3 5‘n t CT lit 579 WITnOHAWAL 1 i! V J ' ■w l j J . Sc 15 s 00 a 1 : RE ST 15c 001 CM. IFo L-;DIT 1 SJISSE rICLtS TrfUST i04KAY95 CEPuSIT C / u 11995c ! OEFuSIT F/* C/N 199v9o OvHAYVSi C/N 15 4027 lLCi.uEfENT A,-,So/l i * C a y m a n ILTC C/ iV 11990 c 15HAY95! CN 15a021 C m E IfO llfc LTD 31MAYV5! CN 159152 A.’.SiACri? CAYMAN ! RE jv 1V5230 Ch^Gs AP* a N l. i MAY 95 . 01JUNV5. Rt UT 15917 h L O u t i - i M C2JUI.45! FA C/N 6i9u5i 2VJU N 95I fit jT 1 5 S G 2 1 K E v E ^ S a L Tu i CANCEL V/L IC u 595 30JUNJ5! I« T cR t S T T u JC j U'i?S ldJuL95l Jv 1 9 t > 4 1 6 ° i Cn*Roij T O laJ7«i 2 9SEP95I DEPOSIT C/N 5»5i77 t C E ^ S I T F/ a C/" 1-S177 i;iEr»i 305 EP95I INTEREST TL 10UCT95! Cll 1 o 4 3 s 9 2 JO CT95 0EF0SIT C/>: ll^aSv DEPOSIT F/a C/>- 1 17NUVV5. Jv NO 1V3605 charges tc 1 7 / 1 1 / 9 5 29NOVV5! C/N 1 6 6 3 3 v A n S c AC^ER ( C A l M A M i - T ^ 313 EC ? 5 InTEREsT TO IN TH E EVENT OF QUERIES PLEASE WHITE T O OUR INTERNAL A U O IT DEPARTMENT. A.JScACH" CCAYka:;) lTj £PS b■«P .'It aTTn hr “ICttAiL 2aY ®0 £0* oc7/ GhanD Cayman CAYrA.'t ISi_an" j . 04Jj L9» ’ VALUE OATE 1 ----------- — CREDIT DEBIT ---BALANCE ? / 2» 7/37-.2» '• 06Ar* * v 5 i ioA?fi95 i°/Ao2.5* 26/175.0 luAPRvS; 05'**«Y95 2/ls5/0 75.sj 05-IAY95 i 3 0A r**95 3UAPS95I 1 i/751/7J7.67 io/631 . 52 :,UuC.}« J<5/!13.0» , j25/il3.j ° 0 v <;a Y95 i 1 v/"“h YV 5 j 31KAYV5i 3U-.AYV5 ■ 01 JO.NV5 • j 2 J w rt » 5 ‘•i/^72.1. 1~ . * 7? It : ’ ‘ 17/95'".. 9 i ‘•3/95C.92 <.2/526.02 lot 1 r ') i l> , '1 U 2 5/u0u.uu *. / Ui...; 2.5c 2*45C,UC.0u 2V-.L.W5 310zCv: 3/9-9.5i 72/071.4.1 72/068.83 11A/ 0 o 2 . 115/113.99 93/6 59.02 39/ 7 Z u . c 3 V3 / 771.74 5 15 .3 J * 7/9 2 6 .9 2 2/*91/ v 9 h .v1 1/051.15 t,'l,4£4.?7 5 iC/i37.yi 17 ,;vvs -l/6sl.!i; j ^lL.i2 1 ■ l/iii.7s: :S.Cu 31-AYV5 3 0J J N i 5 1oAJC»5 2 »S £ P 9 5 ■ 2»S;P95 3uic ?» 5. lsL’LTy5 l6i/v.Tvf. lc-vTv5 **i*6ol«£2 V?, 756.11. C06 . 6 * vi/2u6.2o ■5°/ _/ J?». i t OVERDRAWN BALANCES ARE MARKED DR Ptoua iwm that cradlu n M MMr «w •bow* dal* do n«l sppaar on this iut«m«nL a n S o a Cii E k (C a y m a n ) l t d K E F : 3rtP«Mi< ATTN MR MICHAEL OAY PO BOX S& 7 , uRANu CAY MAN CAYMAN IsLANOS A/C: G 2 / U l u 3 7 / a l IRISH INTERCONTINENTAL BANK LTD. 91 Menion Square Dublin 2. Telephone: (01) 6619744 Tele*: 33322 Facsimile: <01)6785034 oar* uz? CL D£M \ u « S t S PAoE NO: j DATE • . , s>» A*CriIvE COPY S T A T E M E N T D A TE: ?<•JULYS 009 DETAILS !0 6 M A R 9 5 .BROuSnT FCR»ArT Jo-*E*'T !DT 15e274 L J, '0 T 156275 Lv.0uErtE:.T :DT 156226 LuJjE*Ef*T :ST 15'o2o5 C«» Iri c A ‘.k JF IK; LANC :DT 1136267 »ITL«A^Ata ’C rid IFO cA’U j f I.-\El*.nS : J* 1924,j 9 S 172 G u A t A n T c E 1 FEE S LODGED 22 12'«<. - 95 23MAR95'REVERSAL i C H 1562&S AnSoAv.n£* CAY.i A k 2 7M AR 9 51Cn 1563ol R 2 S 2onAR95i Rt CT 15s 55 5 « I T fi.,** »AL ir CA^tlaLi ALiTcAy 31MAR95' C n 155372 i RivcfiSAi. CN 155372 ^ £r C h -.l I s L c /vLaTiAJ 1 RchcWAL OcPuSIT C/fc » 14ji77 1 INTEREST TC, 03APH95: DT 156711 TrlA.’.SFEr. rtAT .& = s . limits 0>Ar'SV5 !\c jT 156 74t, T-A'o':E IN TH E EVENT OF QUERIES PIEASE WRITE TO OUR INTERNAL A U D IT DEPARTMENT. A.\5=rC-f_uT^ r:^F l sj^r” iG ATTn nn vI CoAcL I'AY rC dt 7* dr.AciZ. CAYwAin CAYM:» I SLA,.vs * VALUE DATE ! ' DEBIT CREDIT balance 2,14-:, 192.6 = lOlARrJ 21"Afi •>5 21>*a R'*5 , 2 1 N«ny 5 21-*i a *'v 5 ■ 21* A F.9 5 : iifnKyS: 21-An9'■ 2 1 «Ari i i £l,,Af'»5 : 211AR 95 ' 2.T/.595 ' i t . ».~V5 i 21 1 A R 5 5 ; Zl-^nRvS : 21-i a SV5 ' . 21“A^95 2 , 1 ‘*6 , U 2 .6 <, x0 .C i 201.* 7 2,9*5.20 2C .Cu 19,***4.1.i 12,729.45 4i5.oj i°,«V4.l5 i'*,oj3 . 5o ■ ■ 13o. ^ 6 JbC *0 u $>353.20 2 , 0 7 0 , 34S.07 2,0o3,991.21 2,060,991.21 3 ,C « 0 .0 u VCi,163. 37 »v 2 / l - 3 . i ) 7 9 j,iilo. 57 oo,77i. -7 2>, 5 7 u. 73 2,?<.7,553.9 b 5 > 4 ,2 1 2 .« 7 334,537. i a 5 j C •C ‘ j 2,247,«7«.29 2,247,378.29 • OVERDRAWN BALANCES ARE MARKED DR PIm m not* (tuil cratfHt n c i l v i i a ft* Mm •Iww* d » t « d o not •pfM tr m ih li m x w w ii. AMSSACnCn (C a y m a n ) REF: l. to IRISH INTERCONTINENTAL BANK LTD 91 Morion Square Dublin 2. Telephone: (01)6619744 Telex: 33322 Facsimile: (01)6785034 SfD£C94 RE UT 151S4* .IThuftAWAL .0aJe.C94: F* C/N 6e3<>22 !16DEC94; H i OT 15253o CH« IFJ SOI CREJIT CARD S E F V K E a 0 T 152526 .ITriDwA.AL 19DECV4. FA L/N o£36.>* i2i0cC*4. Re JT Ii2tl2 .ITHji-AWAL 2 iU cC*4; OcP^SIT C/4 1S2 o 2 c 24DEC94i JV 152664 L u C u E.*iE i»T 300cCV4! ncHc.«AL DEPOSIT C/*« 145x77 MAT.CEP. I52o2i JiDEC»Ai INTEREST TC 31.»ECy4 03JAN95' RcNu»AL DePuSIT C/:> 119o65 OaJANVS RE rfT-lai**?! Cha'SuES n - ‘jiC 5*» 12JAN95i FX C/l. Se*ulS 27JAN95; Nc* C'K rtATE 5.7iOUOdCU 07FE395I s i;Nc«fAL *Jc ° vj5IT C/'- Iy*V9o Oar £5y5! Rc J V 1 y 0 73 >. Hz Cn **ucS J A :,i 95 24FE-)95lRfc l-T 15 516* C h »- F/ u a 1 Ea STw OGj RE uT 1551&3 CMi r/vi A-^ICAf. i E*F nESS EtKyPi LT., 1 k a T.OEP. I»9j9i 27FE695! Rc iT ljSloi nA.\ n3aS T FE* Cis 155332 n H J S b Cu lS'.tyZ A:.3^Ai.w ;:i 06«Afi9 5. CicPuSIT C/‘- 9vlw4t Dcr*CSlT C/'- 9i4 2 75 Cl£P US IT C/ ’i 9y5u3» DE 3 jS iT "/A C/.‘. 1 iti 73 • STA TEM EN T o ate OtJoL^r 000 u = 3 0SIT F/.4 C/f V l l u i u u c ^ C S lT F/A C / ‘-' 9 * 1 * 3 * IN TH E EVENT O f QUERIES PLEASE WRITE T O OUR INTERNAL A U D IT DEPARTMENT VALUE OATE CREDIT DEBIT BALANCE 3 , 1 5 ?.2-1 . Is OktizCii 02ScCV4 07CECV4 OswtCSK. . i*i)£C94 lou=.C94 1V-)EC*» 21J l C v 4 : 24; 3(.aiCy4; 3Gj;CV4: 31jiCV4 03 j AN»5 t5JA-.J5 ie 27J a .-.j s ; C7F t i 9 5 • j 7F c 3V5 04.IV 1/321.1 vi 1/000,000.30 3/0o8.1i iils.’l 4/2jS.il 2,9 0 5.5o 1 , 0 0 0 .Gu 950,CjC.Ow . 2 , U 2 , 6 2 2 .1 i 1 j 3h . y7c ■i i 2,133,056.^3 2,li',o5t.i3 l,l*:,6st.63 2,1^3,627.61 9ii,ai5.c:7 » 51, 315. j 7 4 y #ooe. »c £ b i . .'2 • 3t.^» 2,9 SC .7u 2 .4 y 2 *>F cf- »5 75,9uO.C'U 2*f t'jv 5 2-.Si3i5 2‘*?^5'r5 27FEe95 27ri;V5 2oF£b'*5 2 »ri 2 iF i jy 5 6 0 6 •5 S y40. 23 2,123,627.61 2,173,294.07 2,173,557.79 2,173,503.15 2,170,552.45 2,171,552.45 2,17C,754.E2 2,17'-',752.33 ?^c7r^Ci5.61 j 5c2,o..O.’ j -Cl. 79 2 * 0 70*4(17.17 d5,Oud.OL* 416,4x7.2 t V„;,= 73 .Si *3?,Cv4.ja j c >*(••*/ 2 ir ; 3 V 5 2uF1 2 v5• . 3/15C,7y'.io 2 , 1 ? f , 795. 'o 2,1-7,727.75 «• 1 5 ✓•j t !> c # j[ 12. *c 2* 1 **c* 1 v2 • 6o j OVERDRAWN BA LA NC ES ARE M ARKED DR R n w net* that cradlti n u i « t 4 aNpr th « ■bw« d « l « do nol *ppMr a n ihl* MtlMMnL ^'(Sc^vOt1* (CAYMANJ L^bi r;F : jr.H iC A TT.\ ir ^1Cha£L DAY Pu c ■ *"*A a ? 7 , o i ' . i j GAYhA’« CAYI**f( iSuAiikO ANSBACHER (CAYMAN) LTD KEF: GfiP-HO ATTN MR MICHAEL DAY PO 5UX 867/ GRANu CAYMAN CAYMAN ISLA NUS A/C: 02/01067/81 IRISH INTERCONTINENTAL BANK LTD 91 Memon Square Dublin 2. Telephone: 101)6619744 Telex: 3332: Facsimile: (01)6785034 u3P JEP CL DEM SON RES os M C H I * ; HauE NO: OETAJLS OATE □RGu 6 nT p LF*AnL> Dc^wSiT F/A C/N 199a65 INT cSEST TO i0SE°9<> JV 18e367 CriAKiES St* 1994 07 14V479 7/F DT 149525 CriS IFC CnEDIT SUISSE F I C l ES T k u ST ^Tu 100CT94 DT 149431 =.£ T/F DT 149632 Rc 7/F 27GCT54'DT 15C1V2 CnS IFO eul CREDIT CAw? S£B v ICES RtNtWAL l)cPu5IT C/N Iy4j7j r.cNcwAL 0c5 *jSIT C/»< 9i.l»>40 StHtUAL i)eP05JT C/ 1* 9vluJ9 Q4K0V9AIJ'/ lSd<*£9 CnA*27 Dt'r OS IT F/A C /'• 9 203 ?7 16N0V94! DT 150776 .ITHC k A.A l F/C A S a ST.UC j 21N0V94I RE C/N 1 ? 0 s e7 :RE C/r> 121<:^7 23N0V94! DT 151C-2 ChJ IrC ;jl C a I JI T CAh^ Swi-VlCC^ Fx C/N 6S22i4 28NCV94- 9tNc»AL iceOSIT C/ k- 194373 ■REl.c«AL UEPuSIT C/ ‘- 911u4U RlNE«AL Oc^uSIT C/f* 9V1 j 39 3 JN 0V94 ■Dc° JSIT C/-i Iv9j9u DcG CSIT F/ a C/f. 9V.ATM*\) lTo ■iz? statementoatE' CJPt Ot/0 : ATTa* .-= - IC n A c L SAY P U c C l a s 7 , c r . A M C CAY>a .-. 0 - J j L«* VALUE OATI : 2e5cpV<. 3a5EPyt 03 j CT»4 070C7v4. 070C7 v4 10UCT94 ! 1UOCT94 . 27CCT-»4 27JCTV4i 27JCT*t t 270C7V4 GZ'.vjVyi . 0 7-IUVV4 . J3SuVy4• 03UVV* ! 10;,JV »<■ 1U 1u V V4 ' lciNaVyi DEBIT CREOIT j 2o 57/ 3<-i.79 i9.7 0 1 0 ,3 U C . 0 u 4 , o 3 ;,(.?9.3j i45.95 ?J0.52 i 3i .jc *27 .77 19*.1C 33."v. . 2 h I« 4,c.^2, 431. 02 4/’ o ’ /377.94 j 0 o . i2 o7S» OOC.Ox oiii/091,1'. 4«.6.4u 5- >^ 0 . 0 0 1/776, 775.11 4,9oi/775.34,9*>v,32e.9<. 4/ 0 3 2,3af.9i l,li5/M0.j Facwoul*' (01)671^ «■* ARCHIVE COPY ** S T A T iM IN T O A n : PAliE NO: 000 “ M u OCTAUJS DATS 03AuG94j BROU 6 tiT FCRWARD 0aAuG94l D T ■14 73 09 RE HAM NOSS T/F I REVERSAL OT 147309 RE rtAn ftOSS T/F 10AUG94 DT 147*52 TRANSFER UAUG94 6 FEES FA EASTWUOO 5 019 4.S* 30.11.94 JV 1A6396 16AUG9* RENEWAL DEPOSIT C/N 99V«2S 17AUGS4 TO REVERSE tNTPY 23AUG94 DT 147690 CtlQ IFO AMERICAN EXPRESS LTD 30AUG94 DT i*79o7 C m E IFO A E a STWOO u 05SEP94 JV 1871*2 CHARGES SE Al/j 94 M a T.OEP. 120109 DEPOSIT C/* 143177 0oS£P94 OT 148432 T/F DT 14tl4.il T/F DT 148437 T/F 07SEP94 REVERSAL CF DT 14o437 DT 148437 T/F 04SEP94 DT 148448 Ch3 IFO SOI FX C/N 6 alC 20 13SEP94 RE OT 14856a LODGEMENT RE DT 148569 i.Oi/Gctf£NT 14SEP94 OT 148638 TRANSFER 15SEP9* DT 144779 xITrtCRAnAL CHti IFO EAN< OF IRELAND CREDIT CARD S E f w K E S FX C/N 6el261 16SEP9*] RE DT 148786 • ITHORAWAL FX C/N 6el*29 23SEP9*! DT 148748 T/F G KICHEY 2oSEP9*i OT 1491o3 RE T/F DEPOSIT C/K 119i65 IN TH E EVENT OF QUERIES PLEASE W HITE T O O U fl INTERNAL A U D IT DEPARTMENT. i VALUE DATS 2 73' ^{*9.3* 09AUG9*! 0yAvJC-S*l 09AUG94 10AJG94 273/359.3*1 114UG94 10AUG94! l6AviG94< 23AUG94 3 (M uu94 j 02SEP9* OsSEPvA SsSePV* 0oScP'»4 06SEPV4 Go S iP V * OoSc P94 0 7Sc PV4 Oese P 9 4 : OoSt P 9 4 ! 12ScPV4I 12ScPV4j JL**SEPV4 j 1 15 S1 F94I 15ScP94i 16S&P941 1 6SE P 94 • 235cPV4l 2a5EP9<>' I 2oScPv4 i 43.35 943-53 20.ouo.oo 34.69 l,5Q0,0jC.3o 441.Ou 397.32 5,572.25 5.572.25 4' 75«/Ul.jj 3 , j 72,25 375.00 U,o<2.0 j 207*104.61 1*8.32 4 / 7 4 5 , ' 237.3o */952. Sfr.tbi */9$J, 340.1^1 3,*!)C.0U 7.9 2?.0 0 */941,0J2.x l 4, 3t/0• 30 2*477.5 0 12,0«0.Qu lO/OUC.Ou 5 1 3 ,5*5.4 J 4/934, SS4.M-1 *,*22/554.4# I 4,394/409.1/ ...............~~tt rriii mnMr PMm m m M n * ■ ■InAiiltMiiifaiiikaM Am3c*C/i£k (iI*YMA*») LTO H z.fi uRf-f.D ATTN nS M C n *cL DAY Po cJX d i7 , C-tANO C a Y a a n CaYP^ii IsLAi-DS ANSS a C h E k ( C a VMAn ) i< EF: LT D IRISH INTERCONTINENTAL BANK LTD 91 Memon Square Dublin 2. Telephone: (01) 6619744 Tele*: 33322 Facsimile: (01)6785034 GKP-fD ATTN HR MICHAEL uAY PO duX 8 6 7 , uRANi) CAY MAN CAYMAN I b L A N j S A / C : C2/vi i a37/81 vi5P UcP CL DcH NON RES »3> PAvic >ij: t— '• OATE VALUE OATE DETAILS i S C U u h T F0R<»Ar ^ t V : r j A l V? 7 / {»/ 9 •• . OT 99V9*.o T u n E v E r . 5 i c*TRY Vu j / 5 / » 4 I n T i f EST AL'jUsTrtE' T Kc ! DT '999V4* **a T u PI' ‘iv; I H C ^ k PECTLY UN 7/0/94 , c sr i S I T C / “< D e r L S I T c /A C / '■ 9 y 9 ? > 2 2 J U L 9 4 ! O , 14 o7a4 RC.S , JV 14o7o5 2 j J U L 9 4 l DT 14 o 7V1 CrtEiilT 27JUL94; DT 14t9o5 Cnu I r C CAR y iEi-.V ICES . F a C/r. 6 50021 2VJuLV4 uT 1469S3 T / F t = DT 146931 T/ F i D oT l*-es a2 t / f c;03AuG94 JV 156175 CnAR5s£ = i J UL Y 199* CI = TC U i AUuyA h t-\ l » AL 1>c ° - S I T C/-- I J Ov Oo 4 0 w t 0 ^EF : > 4.6.5 4 4,'jj0.0u 4,160,356.80 4,15o,3 4 4 .6 o 4,152,344.64 442.91 2 , 0 1 s . *4 4,149,462.89 132.45 19*.i l 1 2 - . o3 4 , 1 4 9 , 9 1 4 ,6a 9ti.oc 4,149,850.26 4,149,946*92 3 4. 4 2 n b a l a n c e s a r e m a r k e d or PIu m not* that cra d lli ri w lw d altof tfw •bow* dal* do n ol « pp— f on this m n w n C us.k- n- C*YrAf« * « Ov e r d r a w IN THE EVENT OF QUERIES PLEASE WRITE T O OUR INTERNAL A U O IT D EPARTM ENT. A,.S2iCrtc- CUPT 0*. J dL Vs :01JuL94 I • •• A -i C n l vE Oj O lSi_‘ ^Ca ANSaACHER ( C a V h A w ) LTD C/U COSPORATc S£r»VIC =S n c r : MAIto A/C A/C: IRISH INTERCONTINENTAL BANK LTD 91 Memon Square Dublin 2. Telephone: (01 >6619744 Tele*: 33322 Facsimile: (01)6785034 02/G1037/81 Gci* ui? v.L CtH RcS #* r'Aoc l i t : ! 2 4 m a y 54 or^G uO .nT 2 6 .-iAY94 J T . 0 3 J U N 94 1 1 1 3 J u ’i > 4 'lo J ,22J U N ? 4 U V »4 DT 1 4 3 5 * 5 « * l T n l - A A * A L 0 5 J U N V 4 C'T i 4 3 - I T r O n A * A t . 0 3 J u N * c J* Cr\ArtuiS "i lAf i^V4 jT l A i t f i ? * i T n C r t A mA l c T 1 1 53 **2 o 7 : d i 4 c* T I'T OT IT ZT 2 ir J U N V 4 , 3 u J uN f 4 0 ’ /■. CREDIT DEBI T BALANCE 0 c a ’J 5 I T 1 4 4 5 9 0 C a 435'* t • J J ‘. » 4 2 , o o c . o o 1 7 . ? U 4 , l o i , 4 6 3 . 6 ** 4 i. 2 . 7 o ' 4 , l o l , 0 1 9 . 9 4 7 i 7 . 2 4 1 4 , l o O 7 , v i C . G 0 , c o 2 . 7 C • 1 ,?o 6 . 6 j 1 2JJvJNy2 jjur.ii . (J7 j u N v 4 . 2 4 J u :<94 2 ojvK» X 9 ,;*<» 9 • 3 i 0 j J J f . V - w T rC * ;v A • Al. L T ; 2* J 27 J PT 4 , l o 1 A 3C 47 DT 23J U / . V 4 ! DATE 2 6 r 4 Y v 4 C / n u F C ^ * » A n u uT 1 <*huVI i VALUE DT F a C 2JPr595 DETAILS DATE A rtC ^ I V c OjO l,UuC « 0 'm 2 al Cn£»Uc lCJGEl1 l 25APR94. CT 1434ofi C h E wUc IF O oOI 0T 1434a9 . 1 DT 1435J0 * IThDrtAwAL F a C/N 670659 27APS94' RENEWAL D c P u s IT C/!. 194373 Ftf-EwAL D £ ° d S I T C/"‘ 91io*.0 R t N t . A L C c P u S IT C/N 991J 39 0T 143494 LuOuEnfcKT i CT i434V7 L uDuEflcf'T i DT 14349S LuDuEf.E.'.T DT 143496 LODvEnEi.T 3T 143493 L J0l>EnEi»T 2dAPR94." 0T 7654o TSANSFcf. i DT 143653 Cn9 F/C AnE'tlCAN 03MAY94: CT 143759 wIT.jSawaL 1)4ttAY94I D EPO SIT C/f- fVO»4 * I OEPCSIT F/A C/M 9vP546 05hAY94l J V 133952 Wi. CrtAFosj Hi t RENEWAL D ePilS IT C/^ 999V4e 10MAY94I DT 144062 TnAriSFEK 1 DT 144361 TrtANSrE^ lxM AY94! OT 1440 72 LCwuE? E ’.T 2UrtAY94i OT 144437 CMi F/C *rE n ILAiN , E>F l t d 2_>r.AY94. OT 144529 Crtw I r G 1 CREDIT CARD SER VIC E DT 144530 S/0 Cfc" Gj E R S s -Y F X C/i* 6 77 b61 2*«AY94 DT 14456J ilt n t " rw~S ./ " v « « STJCTSM ENT O A TS : 20c£r*v5 000 JU S ^ C n c .- U * Y *A \) l T u C/0 CuW»*0»\AT£, S i^ v X C E s " i ? I f.Al't A/C VALUE OATE i--> ' 08AP994 ■ \ 1VAPS94 03r"AYV4 j 25APR94; 25Ar*R94 1 25AP3V4 25APR94; 27Ak :5v 4 ; 2 7Ak S 94; 2 7Ar* R94 ! 274^94', 27AP*9<.! 274KPV4 2 7Ar V4 27AKR94! 274?^,4 ic.Ai'Sil' . 9s. 03 m a Y »4 3l»AP‘t94 30APRV4 04rtAY94 0 5c * Yv4 : 1U^ * Y y*»10>i a YV*. • ll- .»Y y4 ’ 2UJ-AYV4 23r.AYV4 2i.^«Yy«: 23'iAYV4 24 *1A Y y fc OEBIT CREDIT ■ALANCE ‘ /27'i,13C.32 4»2 o 7,415.17 2/715.10 *.,2 0 6 / 3 7 9 , 5 7 4 , 2 7 1 / 2-.E.64 1/C3S.60. **/ce9.u7 6/123.62 4 / 2 c, 3. J j 575.00 4,3c5.3v) 1 1 1 4 3 / 0 9 3 .* 3 i i« 2 .9 3 4 0 , 3 0 . ) . 32 1 3 7 9 .j ? 1 ,5 S i.c C V 1 ,o 9 5 .il 1 ,2 6 3 . oC 3 09.3505..7 1/loP.17 17.42 311, ?fc«*4 , 2 5.*A R v 4 , i 1 2op £594 • a n.94 29r,An^4 2*,-.a RV4 143 /3 79 .17 31M An9»* 1 6 1 / 3 7 6 . 2V 31KAPV4! 514.36 359.91 3/4 96.14 & ,4vS.l«. 35/000.00 59/ 31b.aO 95.99 3l.<*Ry4 05« r R 9 4 . OSAFRyt * 0 5A PFV 4 ■ 3ivAR'y4i 4 , 6 ) 1 5 , 8 9 9 . 3a 270 /0 00 .00 7 , 7 5 2 . OS 35.55 4,54 7,84 1.89 4 ,2 7 0 ,1 8 5 .8 a 4 ,27 0,13 0.33 OVERDRAW N BA LA N C ES ARE MARKEC P I u w m w ih a lc rW lta m i l v i i t m : ohomtfMatoiwtappwrMMa MM A.,SiACliE- ( L A Y M A N ) LTu C/0 Cu^POnATE SESVIC'i r.'zf : M A I N A/C ANSBACttEii (C a y m a n ) l t d C/0 CORPORATE S E R V IC E S R E F : MAIN A/C IRISH INTERCONTINENTAL BANK LTD 91 Memon Square Dublin 2. Telephone: (01)6619744 Tele* 3332: Facsimile: 101)6785034 A /C : 02/01087/11 OBP OEP CL DEM NON RES »* PAGE NO: OAT* ARCHIVE COPY SS. S TA TE M E N T D A TE: 20F ='v 030 value details DATE 20JAN94; BROUGHT f o r w a r d 27JAN94 RENEWAL D E ° o S I T C/N 1**373 • *. SEN E.A L D E PO SIT C/N 911040 k EN cm AL C'EP u S I T C/N 991U3V J a J A N 9 V RE DT 13932* PAY o ARC l AYS SAN n i He liT 1*»C100 Chw F/w a Mc R I C a N E*P riESS EliROPE l T lI ;1JAN9 4 CHARGES RE JAN J V 1S0565 5.18000000 U F E B 9 4 NE'w Cfi DATE i DT 140222 TRANSFER FX C/h o73*.33 ) i r E3V4i OT 140501 TRANSFER ydFco94i DT 140537 «‘ ITnC’KArfAL i UT 14053o TnA.sSFEn F * C/N 6 73 o 5 7 i l F t B 9 4 ' OT 140672 w I T iC k A .AL DT 140673 TRANSFER DT 140*73 TRANSFER DT 140673 TRANSFER 1 DT 140675 Tn An SI" E h . 1 DT 140674 TrtA'tSrER • ; DT 140722 TnAwSrEK 14Ffc394; DT 140829 C n i F/C * E a S T w u J J :5Fc3V4i Dfc'PuSIT C/:- I v 5 i 4V i C EPU 5IT F / * C/N 999549 i 2 F £ a 9 4 , FX C/fi 67 44 h O -•JFc39*.! DT 1411-.5 « I ThDi\A»Ai. Crt'i 1/F/O r-ul ; 4 r £394; Si!i 2 ‘ . e j . 4 , 5 1 7 , 7 2 5 . Sfi h, 2 o u . u9 5 , 6 9 4 . DO 322.1 a 2<5.0c So fi.oo 9 ,3*6.50 4 , 5 1 3 , 1G0.7V 1 4 3 , J 7 t .17 9,3 *.6.5u 25,1/00.00 4 , o o l , 576.07 4 ,62 1,57 6.07 o lJ,:7 5 .2 4 4 , 6 < 1 , 576.07 4 ,5 b l , &5o •4 * «»0,00 0.0j 4 1 3 ,c7 5 .2 i 3 9 ,7 1 9 .6 3 3,4 o 4 .5 x 4 , 5 7 e , 391.93 319.52 3 0 7 ,0 7 0.00 i0 7 , u 7 0 . 0 0 5 ,5 2 4 . 2 a 123.3 r 39.49 4 , 5 7 S , 711.45 4 ,5 7 3 ,1 8 7 .1 7 4 , 5 7 3 , 0 6 3 . 7a 4,572,974.29 I TH E EVENT OF QUERIES PLEASE W RITE OVERDRAW N B A LA N C ES ARE MARKED O OUR INTERNAL A U O IT D EPARTM ENT. Hnn noto thateradlfai r«c«ivd attar I •bov«dal*dono«»pp—r«nlib aiaim* A N S iA C n i? c/c S£c : Co ICAY»A XI r p o r a t e m a in A/C l.Tl> S c ^ v i t E j a im A'U3Awis;n c iv ic r a i u i w C/0 CORPORATE S E RV I C E S K E F ; MAlf. A/C IRISH INTERCONTINENTAL BANK L n 91 Memon Squaie Dublin Z. Telephone: (01)6619714 Telex: 333; ; Facsimile: (01) 6783034 A / C : 02/01037/( >l GEP dEP CL 0£M NuN RES * * ARCfllVE COPY PAuE No: MSi S TA TE M E N T OATE. 000 VALUE D A TE J5JAN94.BSG uGrlT FCRwAftD J v 17913* RE Ch a PG ES FOT DEC <. ' '• .’.JV ; JV 174132 ClaTC CHAKaES *E OCT CT 139241 *E uOuC-ED O/U He^nY iNScACht^ 07 1392*.0 rtt LO j G c D 0/0 HEN k Y USiiACr'S'? joJAK94.C 7 139242 WE ►'AY rtE R r ANSsACnifi i u JAN94‘F a C/N t>72373 Ii J A.N 54 ,I T 13 94 <3 TSAiiSrEn 07 1 3 9 4 4 3 T ^ A . ' i S r En 1S J A N y 4 . > 1 t n o r a « a 1 C m -o E IrO r i uT i ?5* wI . : 04JANV4 i , 1 CUJ„I.V. 7 o. : a 76.33 0SJANV4. ■ 05J A N y 4 . 46/752.4 3 9 5 .,2 1 .5 3 I j 0oJA\y41UjanJ4. llJAN ? * . 1 1*JAI.*<- »/9oi.,2<;k.3. T h * . - a <*AL CT 13570: 7u RE» EnSE c*-'T3Y J T 1397e3 - i INTEHEaT Af.OONTS Rc J 7 139e26 « I Trio»JAV,AL N TH E EV EN T O F QUERIES PLEASE W R ITE •O OUR INTERNAL A U O IT D EPA RTM ENT. 1 3 J A . ‘. V 4 laJ«A94 1 7 J a N94, ' 17JAK94 ' lVj~t>y4 'I ! lyj*t\y4 i • i19JANV4 4/S*4/a2 7.1 c 4/826/134.1c 1/0^5.6 b 4,264.69 222.Oj 4.81a I vjAl TY ML®£ •DanCE Cutis ^T :j97/: w i t n o n . a l n / j r.O n riS Z T 1357^3 *A «7 l!.i 2uJAN>4 BALANCE 7 4 / 8 1 2 / 5o0.7 o 2 / 1 0 2 . 54 2>4/5s 7 .2j OzoOo.53 O / o 0 o .i3 2/3<.’5 . 7 y 4 / 5 e 8 / 80 O .7 c OVERDRAW N BALANCES ARE MARKEC P M m i m w ttial credits m » t v * d t t w • to m d m 4 s not ip f a a r m i ttil* i u i m A-.iiACHc7' (Cay^a-.j c7u C/C Cu:0I C’-. p a L/S 67177o F a C/i. 071 777 . 5Dc C t 3 CT 13fc226 F(jn PAY I *.S Ss E r „ X LcTTEK KE CnE.U E r/u h -u0tC93 CT 1 3£ 2cl EaE T.OOu KX C/N 6717-7 i c b 6 C 9 3 DT 13fc7V9 t£ C n E i o ; Ft_G A.nEnlCAri c X H P E S i c u k CPE L I “i IT ti; 3 1 u E C °J U D E C S3 IN TEREST to VA LUE O A TE ! OEBIT CREDIT BALANCE rf S ,l5 j,S o i.2 OiOECV3 0aj£C>3 i>5,42’ .53 C o n iC iJ 080ECV3 090&CV3 1J0-C93 1 3JcC v3 ■ 1 3jtC »Z ' 9 5 ,4 21 .5 3 *•6,752.4.} 7,13 0.1* 1 , 7 0 7 . 2c 4 ,7 7 5 .0 0 ? t 3 .1 o Isj^ C 93 ! 1o3 c CV3 lo JE C y S • ? 5 ,< .2 l. 5 3 12 5 , 0 0 C. 0 'J 1 5 ,0 * .:, 7 0 7 . J 5 ,3 3 4 ,5 o B.l 1 ! 1 5 ,C 2 7 ,lo 2 .7 i,« U 2 ,lo 2 .7 5 , 0 ^ 0 . On 4 ,8 9 2 ,3 5 2 .7 4 ,5 1 0 .3 0 I 2 2 JiC 9 3 • 3 1 J iC v 3 ?7 5 .3 v i 7*,l50«o0 4,<>92,074.3 4 , 9 o4 , 2 2 4 . 3 i i i I I TH E EVENT OF QUERIES P U A S E W RITE 3 OUR INTERNAL A U D IT D EPARTM ENT. CAt ?!A:i ISTErtKATIC'iAL jAilfc TaUiT C j 'VA n Y LI'.ITtO C/0 CuSr'OnATt SE^vILEa OVERDRAW N BALANCES ARE MARKEI P tM M M l * ItMl m M a im lw i mhmr ■bm dal* do not i p p w r wi thl* mm« i CAYMAN INTERNATIONAL BANK i TRUST COMPANY L H I T E j C/O CORPORATE S E R V I C E S ATTN MR n REONONO A /C : Gap IRISH INTERCONTINENTAL BANK LTD 91 Memon Square Dublin 2. Telephone: 101)6619744 Telei: 313:: Facsimile: (01)6785034 02/01087/81 OEP CL DEH NON S t S * * ArlCHlvE COPY s<* PAGE NO: DATE S TA TE M E N T D A TE 000 0 SOCT VALUE DATE DETAILS ilOCT93; «!iOC,T53 ' ' B S O o G m T FCRrfAKD Cn 136407 C n 13&iu7 UT 136406 C h E w UE F/O AMcFICAN EXPRESS EL30PE l TU CW 13o424 WITHDRAWAL T/r 2o0CT93: Cu 13oot3 v»IThO RA«A l 270CT93’ DT 13 o 465 DT 136465 CrtS F / 0 A tASTWOOJ : REfl£«/AL D E PO SIT C/N 194j73 : RElicWAL D E PO SIT C/S 911o*U ! RENEWAL DEPO SIT C/« 991U3'* J2N(JV»3! Nt« CR nATE 5.3?5oOuOO lo ll0 V 9 3' DT 1371V6 PAY A/C UNUV93 FX C/N 670350 1o N u V93. WITHCRA-Al jT 15744V T/F WITHDRAWAL w T 1j 7j »4o , FX C/N (.70635 I0NUV93,' DT 137530 TKA.-.SF Erf 1VNOVV3 0T 137536 C n . F/C o*.I : FX C/N i 7 0606 CT 137550 T rA u S F E S _’2NOVV3, DT *37575 Ch3 F/C 1 rtt uT l J 7 o 6 i nITMwfiAWAL ’ 4N0VV3i RENEWAL DEPO SIT C/»- 999 o6i 2vn0V93! OT 1379J3 CnE-U= F/O A F R I C A N ■EXPr 1353*9 LuObE.iEM T/F 0aCCTV3. I Cl. 135649 LuCCiE'lENT T/F OoOCTv3' . CN 135S 4 9 L J O o E ’l EhT T/F O auCT• 1Ci. 135349 LoOuErtENT T/F OouCT93• C(. 1 3 5 S 4 9 L u l . c E M i n T T/F OaJCTvi• LoOucpiE.nT T/F , Cl. 1 3 5 1 - 9 OoO C T 9 3 ■ i OT 135907 T n A a S F E n I HCv. T y 3 : JOCT»3: Ci. 136103 11 Trlfrt A » A l I30L T»3 ' i Ci. 1 3tO V l wI THDrtA« AL T/K 130CTv3 Lu^uSrEnT T/f Cm 1360 91 13oCT»3 ' CN 12fc0v3 » I T h U h A . * , . T/F 13CC T»3 I4UCT93I Cl. 136102 * I T hL nAwAL T/F I v j C T vJ • FA C/N 069175 140CT,3 : FA C/I. 969452 140C T}3 ; CT 13aOV6 ChJ F/O PANk OF ' IfttLANC C n z u IT CAfil) ScrylCij i 1---C Ty3 CT 1360VI T«A;.Sf-'En I 13.XTV3. laOCT93i DT 135j*2 C.*tO NT I150CTV3 iF X C/N 0 6 »4 53 ' 150CT*3 'P t UT 13o2;i « ITmuPawal j 12')l T ■) j •iUOCT93. OT 13o*ii5 Tr.A;.SrEn 2C 0 C Ty 3 ’ 1 ; ~i : ■ 7 v > • il OCTj3 .Cn — SnA.^7. ________ * TH E EV E N T OF QUERIES PLEASE WRITE O OUR INTERNAL A U O IT D EPA RTM ENT. CREDIT BALANCE 5/; 331, 5 5a.jC 7?,y?* .7 2 4 7 5 . ou 5 .4 5 1 . 5 - ; 5 .45 1.5-: 2 .8 6 0 .0 0 5.000.01/ 5 ,4 -3 ,i v 2 .3; 14,7 0 5.e3I 3 94 .i3 j -2 7.7 6 1 5 3 5 . - fc ' 570 .37 ' l.* 2 i.* 3 1 .-Z 5 .V 7 2.136.V7 i5 .0 0 0 .0 v 5 .0 0 0 .0 0 21j.oCU.'jO 5 ,6 7 4 .t l 4 . 4; 5, J00.00 l , l b 2 .7 e 14,705.6 3 2 L'5 . 1 7 0 . 2 9 5 , 6 * 3 , 661. 72 4 .S 2 P .0 i; 1 .5 0 0 .0 0 5 .30 0.00 5 .4 1 7 , 4 6 5 . 8 0 2 ,U5u.uO 7 * 3 . 2u 14,705.A3 4 .J29 .71 » .7 n n .r,.» 5 ,404,06*.97 5 , 3 9 9 , 2 3 7 . 2o OVERDRAW N BA LA NC ES ARE MARKEC Ploaaa n sl* U w i era* l u tacolvod aRar •bow* dal* do nal appaar an H C A Y , J A.N INTERNATIONAL OAUH TnUsT CurlPAiNY L I “tlT E 0 C/O CORrOnATE S t r t V I C E i & CAYMAN IuTcRnATIuNAL aANfc 4 TRUST COrtPANt LlrttT cu IRISH INTERCONTINENTAL BANK LTD 91 Memon Square C/U cOKPoRaTs, S£uVIC-s Dublin 2 aTTn .irt n Pt£ur.u'w a/ C : Telephone: (01i 66197-u Telex: 3332; Facsimile: {0 0 6785034 C i/ u l0 3 7 /o l ijBr* u£r' CL d i ? non ** AKCnIVE C j PT »» PAo£ Ng; QUO •3oUC T value DETAILS OAT* •ALANCE II:.' 3. Ci. 134ci2 LuDoEiEriT c.. 13*»e 31 «lTnurtArfAu .iS c P 9 3 F a I j 5 i i ? v 3 F a C/i. 645147 j.6ScP 93 DT 135012 » ITrtDnA« AL DT 135013 Tr.A.iSFEfDT 1350ul Tn A:,5F Er. CT 1 3 TnA iShen J T 1 35 Cjt TnA \S Fc« OT 1350O5 T tA .'.S rS ' 2T 1350o7 TKA.’.S rE h OT 135;ju4 TuAnSrc**. FA C/I. ic . - o . 173cs i3 Fx i./t'* 6 o5 •*c j 27ScP93. F.c*- 5..AU U£5vlSIT C/ . 194.175 P.ih tx A L O c P ^ i l T C/ \ » i i w<*0 9V1 ■ ft cN £WAL S t uw5lT C/ *- * DT 13531c T/C s.u5'Ef'93! CT 135375 T/ r CT 135774 T/J y i e P V J DT 1354 j C DT 135457 3J5 cPv3> CC.-: .-..LOAN f / „ 40j6 05 ALSTZA./ S c Cu ? 2TtHS -T u . jC Ai_ST=«: S t C J = * I T i i 3 " C t j J o o r / » h C36 j 5 Cw- ...LOAN A tb T - A J S cC J 1 1T [ E 5 l T j F/:. -Oi 1*5 CC.i M.LuA.'; Al 5TiAl/ S =C.w)-!TliS uT ^ J ' l J r'/;. i J j t v S CC* .-..Li-Af. Al 5.T im ... a.cCw" I ~ i i s . T.. JLU i------ 0 7 s ; =».’ 0 * i t ° »3 Dobcr*3 0*3-=•*’ • lis trij 133C.P93 1 o S c P*3. lo 5 ;P i3 lo jirv l l o i i 39 j l o i r pV3 1<>S:F*3 lo S c P y 3 lo 5 iF * 3 . 1 7 i is y3• 37i£PV3 2 7 iir* 3 2 7: £ P v 3 u U C T-V3 t J i i z r yj 233i ? V j 2vS ==r:. 2;5 c PV : 5,51'// 2 7 t . ; - J * . A> 322.50 I,2 t 3 .'9 1<*6 , 3 oQ •4 7 2 a ‘ .=7 5 ,5 1 2 , 5 . 5 w i , iJ > ..3 5 , ? o 2 , 51r .5 3 ilo .1 3 11/4 56.13 11 ,4 5 A . I o 15#2o‘; . ' i i 7 5 , » UC .? 0 x 7 / T jC .- J j ' ' ^ 30 . 0 i 3 ,A & 3 .? 5 • 1 4 o ,3 a 0 .4 7 1 2 3 .s a : 106.04 c C l.c 2 3,3v,0.3«i 5 9 7 . w? 3/*.*U.25 1 , ■*16 / 6** * . 5w 9S >» 3 j 5 , 3 7 4 , 251.2o 3 , 4 5 6 , 914.10 2v3zr »: 253/300 .00 2<>S=.'>t 3 ^17/uCu.oO 2vs •: »T 5 ,2 2 7 , 856.91 5 ,3 7 4 , 237.3 a 5,371/ 365.90 ^4e/1 25.u 0 ■ S . 5 H , 2j - . ? : 2/731.17 2Vi s F r 3 c Z v J/ u .l.w O j 01 /1 e 5 . J C 5 ,0 4 2 . 004.10 OVERDRAW N 8 A L A N C IS A M MARKED • 4 TH E EV EN T OF QUERIES PLEASE WRITE O OUR INTERNAL A U D IT DEPARTM ENT P l « a » « no I* thai u i d l l i received altar above date d e not appaer a* ihla atatame CAtr*> ir.TcKS#.Tl^Au .-*v, * C*.fSPA«Y CREDIT TC *o S c/v c-'r'-f.a t e oesiT OATI ) ? S c P 9 3 SHOuGrtT F l S h ApeD -7,ScPV3 JV 1^7430 CnAnueS H i T/ f T * u -T S TA TE M E N T O A TE U I-a T d J s =.'■v i l r j cayman International bank * TRUST COrtPANY LIMITEu C/O COnPURATc SERVICES Ir i s h i n t e r c o n t i n e n t a l 91 Memon Square Dublin 2 Telephone: (01) 6619?-U Tele* .1332: Facsimile: (01 ) 6785034 ATTN Hn n A / C : 02/ 01087/ 81 i BP 0 Hi* CL SEP vuN -icS ■» PAuE nu: OA TE * « C rt I YE C^f-Y ** S TA TE M E N T O A TE. ii'XT.. OuO VALUE OATE D ETA ILS : DEBIT bank lit CREOIT BALANCE t J O J U l i J driClviuriT FCSrfAriC JA»JG9I F* C/N s i o L o t j T 133107 ^ i T n£>rv AmAl. ...A U tj^ C-T 1331o 5 -lT nDnA.Ai. 9 T 1 3 3 1 J* *ITnDt\A»AL F > C/N 66 c61^ liAu>j9i UT 1337U2 WITnOnA«A l T/FEn AKl i o o lS .O ti *71.2.5 OT 133701 *ITnL-sA«AL OT 13371* LOJai-lE.-.T L04UGV3 F a i/ \ ft c c 't J i»AoCV3 Cl. 1 3 3 ? g l w I TnC-nAw^ l . F ci\iAL Cl. I l i S u l •» I TnL'nAnAw Tn;_ bAN^ OF IRE.-ASv Ci. i33& >>2 . i Tn jH A .n L t*c'‘ i « A L DE s j 5 I T C/'. 5 C;. 134C 71 p«ITnurtA»>L Crw SAIf . T MAJ TJ:tS S l u u C l Cn KATE 5.4j7>(iuCu ' 3AuoVj c 3051T C/' 1 y 4 j 73 ioAu(j93 S E N ’ l w a L S s m c W A L 2 t 3u S i T C/\ 9 V U 3 9 i- O V/iL o 3c» 13t.5*3 » I T m. ;CA * a l. 37StPv3i t. I T n w Ft A w A L P A Y 1 A r .A 2 . l i L . Pf.O^EnT I E ; PJC J T 134533 J< 1774j l C' J Ot Uc 1-. CriAnw; S ! . 'r . '■> ^ i l t i ' J i C i . i f --------------------j 5 ,4 u3 , 7 4 : . 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PA-jE 17JUN93' 330UG«T Nu: NUN RiS S TA TE M E N T DATE ii OuS VALUE DATE DT FX C/N 6o*22i 1 3 1 2 G 2 WITnOfiAwAL 1 3 1 2 0 3 *ITrtUrT IMcfifcST TO iOjUUv^ CREDIT 7,\*3 17JoN9 3 ! loJo;»9: IdJON9I 21JUN93 23JWNV3 23jon^j: ’ uJjN V i' 3 m I 3 C Ju ^vJ. 3bJufcV3 i TH E EV EN T OP QUERIES PLEASE WRITE 0 OUR INTERNAL A U O lT D EPARTM ENT. CaY.m*.» i *.TEF.naTI u.nAl :>An< t Tk-J£T Cvi.tf-AhY Ll'UTfj C/T/ CijnrU^ATE S-rrVICEj :0 . Na. 4 0 5 3 7 R.l. DEBIT FCRaAriO DT 131250 LOOoEnEuT IiT 1 2 1 2 3 7 ulTfiDSA.At r: : FA U J U N 9 7 OT ;JJUN '»3: .-aJUKiS. j„JUNV3 D t“ OETA IL5 D A TE ' CL 1*A,0j C.3w 9,S 35.0„ i*,5uQ.3b Jio.77 135. Ou 7 ,7 7 5 ,1 7 5 .: • 2 2 2 . o2 7 , *i :, • v-. 5; 7 , t t l , Vi-1.7t 7 , < - a l , ? _ ; . 7- X i 5 •0 V I # f- - o 7 , ° i 5 . * * o 6» , l e v . a 5 6, 7 iT , 6x7. c . O VERD RAW N BA LA NC ES ARE MARKEC P IM M n o w n w ie ra d lla n c * t n 4 «Mm « bow« data d o not appear an tMa atalafti a i M i c iv ic m i CAYMAN i n t e r n a t i o n a l b a n k . (. TRJST COMPANY LIMITED C/0 COKPOSATt S t f t V I C t S ATT™ In n ittJ’lONJ IRISH INTERCONTINENTAL BA.NK LTD 91 Memon Square Dublin Telephone: (011 6619744 Telex. 333; ; Facsimile: lOI 16783034 A/C: C2/013i7/al u&r' J zi1 CL C c “ n j n S t S A.^CnlV; Cu=Y we PAoE Mu: J value OfTAILS DATE S T4CTEM ENTO ATE O j1? 0C8IT OATt CREDIT “ A *“ V i 8A LANCE V *2Ju h V 3 BROuOriT fJ J j n 93 * * J JlV1 ?3 T jT OT 130S33 1KTL j T I;;T OT DT F H / o J U inV I F u c -A*D 130623 CT J j:nV3 1 I J j:,*3 :-»j u n v 3 liJuN VJ. -C,JuNV3 0T Fa CT Fa DT CT w lTriOTA-*t. 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I NTEnN A T I O.'i A l TnC-cT Cui-rAi.* L l ' l T c J ; ■ ' ; : 7 . i 5> Pfoaaa net* lh a ie n d lto laeohad «n*v i b o w M i t e M a p f M t n M a M alar jA iU C/L' Cw^rL’.TATE Sc-vlCHo & CAYHAN INTERNATIONAL Ban*, i TRUST COrtPANY L lM U tO C/O CCSPORATt S En V lC tS aTTK NK « KEUMJNy IRISH INTERCONTINENTAL BANK L IT 91 Meirion Square Dublin Telephone: (01 >66197-14 Telex: 333:: Facsimile: (01)6785034 A/C: 02/G1087/i»l I1 6 P UEP CL Ccf* ‘ ’’ON RES PAoE NO: S TA TE M E N T O A TE : Ok*A°»fc COO value DETAILS OATE DATE . ' CREDIT OEBIT BALANCE 1 » 4 a P h 9 3 ' •j S O u G m T F C R u a RD Pc n A r l L T O f ROSS „ * A Ft n 9 3 T / F LCl/cE^iNT j T I2 j7 5 e l i * T E a R.' i E j . j A r 'A v S - JV 173512 b 6 , l b E,4 9 * .9 JV 17?o82 vi-N SJP 010*93 O U iC C/. ' . J E P O j I T 3 1 S 3 V 3 1290 i 7 * l T n J - < A . A L 1 2 9 0 i s L O O u E.- i E n T I 2 9 0 i 6 w I T nOrt A ■*A c 1 29 0* 9 WlTrtOnA.Ac. OT ST uT OT .OAPS93. F a cn j A H r V 3! 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SERVICES Telephone: 101) 6619744 Telex: 33322 Facsimile: (0116783034 REuMO.NJ 02/010»7/al GbP JEP CL PEM NUN « E S S TA TE M E N T DATE «•* AnCnlvE CuPY HA«E NO: VALUE DATE DETAILS DATE 3-1-11’• 003 DEBIT ; CWEDtT BALANCE V )V*ARVI skCUGHT ; or. a s 9 3 S t DT 12 7 5 i c - I T m OPAWAL JV 1 7 2 7 c ? LoDiszhEttT <vo. 2 * 5 u l‘ . 0 u 12*3*0.41 2*2^5.53 A *5 j 0 . 5 » J j ' . l ? 5*952*899.31 5 * 0 3 3 * 7 1 2 . Sc 1 2 5 .yJ i 4 u . 3^ 3«.o.v3 6 * 1 7 3 * OOct.SO 0*174,549. 1 / 54 3 . 3 6 2j.1 7 15*075.’ J r-aia. 6 * 1 5 9 * 4 v -.03 i v/ i j ; nt . . . A . ’ SiA-iaA-.?! OVERDRAW N BA LA NC ES ARE MARKED Ploaa* M i l ttwl e n M a laealvad allar It • b t w d M ^ s i i M i p p t a r t f t Mila atalama I M E ^ ' . a T l:.-> A u uA. i « . C o f : r A : , Y LIM.TtJ C j-IrOnATE 1/^37.75 : 2i'i*-tV3 2 i ^ a f. t i 2^ .A i> 3 2 5 “ A »\ T m . 2 5^ A n y I : 29^AiV i • 29"anvZ 3u < ^ V 3 3C.,-‘ A C 9 3 3 J -a^v ; M TH E EV EN T OF QUERIES PLEASE WHITE 0 OUR INTERNAL A U D IT DEPARTM ENT. 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I i*T E F it S T T C 3 1 “•A r\ 9 3 J lA P n 9 S ' i# ls 7 ,5 ll . f - i\ 6 33.60 lu'-.Afi93 SE" v IC£ i g m i c iv ic iv • CAY*AN INTERN ATIO N AL SANK i IRISH INTERCONTINENTAL BANK LTD 91 Memon Square Dublin 2. Telephone: 101) 6619114 Telex. 33322 Facsimile: 101>6783034 TRUST COrtPAMY L I M I T E J C/0 CORPORATi S E R V I C E S ATTN Mm ri KEOKONo A/C: 02/01037/41 lioP o?P CL D£H NON Hz.s m* ARCnIVE COPY <** S TA TE M E N T D A TE : 04“ A9'ii PAuE KU: 000 ; D A TE VALUE D ATE DETA ILS . DEBIT CREDIT BALANCE i •0SFE693! BROUGHT FCR-AKD O v F c ^ v J FX C/N o5fc941 FX C/N 6 5A9 4 * •10F;b93 . Sc 0T 1*6599 LOOGtlcNT i 1 2 F c i9 3 F » t/h. o 5 » 7 j ‘. l i f £593 RENEWAL (JEbU SIT C/N 99«t>Oo ! l o F £.3 93 0T I Z t 'J n Z R t vAYXAN I n T l 0T 126045 . I T n O n A . A L i ! OT 126644 LQOu E ^ F n T i . OT 120046 wI Trtori A«A l i F a C/N 659746 I ! I S r caV3: Cl. 127S.S0 WITrtOWA.Au 1 ' f t . C/N 0 6v l7 5 : F a C/N o 6 o l : 0 £WAL D c ° j S I T C/^ 9i>9a6i 2 iF c b 9 3 ; 24F Ea93 He. LT 127i*4f *«IThOFAWAL 25FE393' k£ uT 12727a ■ITt'jrAwAL 2oF Ed93' Ac uT 1273*2 tSiC-cHiKT R t u T 127*S1 .I T n j R A W A L I RENEWAL Dc? uS1T C/i- 194.S73 ■ n cN CWAL DcPwSIT C/N 911040 • • C/' 9Vl-j3V • H t ’.cWAL D c6 J S » T G1MAR93 REh t-A L DEPOSIT C/>. 990u 02 rtc'ic-AL DEPoStT C/ n 9 y 9 5 4 0 ■ Nc« Cn nfiTZ 5 . 9 /O j Oj Ou 0-.»V3 09 1 A 3 9 3 09 6/17C/93? . 7 ’ 6 ,1 7 2 , 4 5 1 . 4 1 6 ,1 7 o ,l4 f.7 z 6 , l o 2 , 0 1 7 #9o 2/3o2.63 5 ,o o 9 .* ? 17 ,2 S5 .»1 1 ,2 3 7 .7 9 1 3 / 5 0 0 .oO 7 / 0 5 6 . 3u 7 ,2 6 2 .5 0 5-3.51 2oQ . 7 u o , l y » , ?■.' . 5c • 39 . 60 10 3 . t 6 c 2 i 0 . 3 u 155. 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Telephone: 101) 6619744 Telex: 3332: TRUST COMPANY LIMITED C/O COkPORATt SERVICES ATTN MK n SEuMONj A/C: (ipP OEP 02/01037/81 CL DEM NON Facsimile: (01)6785034 3ES » » PAoE { Nu: VALUE OATE : 04JAN93 d SOUGh T FCRVARO . , RfcuE.AL DEPO SIT C/N 990002 0o J AN 9 3 JV 121.616 wITnO^AwAu * J V 124617 ■I Th0* AWAk J V 124618 « I TrtCkAoAt F a C/N 65776* i 07JAN93 CT 1245 97 MITnOnA-AL DT 12*596 W I T mOk Aw AL ! l i J a N93 Cn 125208 LODGEMENT i Ch 125207 W IT h jn A *A L 1 Cn 1252u2 . 1TtiClriAwAv. i l J J A M 9 3 : 0 T 125206 WI TrtDij Cit •*? PIT........ ** S TA TE M E N T O A TE: DEBIT CREDIT BALANCE !, 5 , 5 s s , 2 5 J . 15, 5 i f , 2 7 V . : 25.74 30,0\»0.00 50,0uC.0O 28.35 10,7 04 .*3 1 ,0 3 8 .0 0 2 0 ,0 50 .0 0 5 ,437,541.9; 5,416,457.92 1,1 2 i t 639.60 125.30 10,*v*0.Cu 2,3>»4.2.> 22 0 , 0 0 0 . 0 j . 1j Z o ' 1 , 5 2 7 . =>o 1 ,7 9 5 . - 3 0 , 5 2 9 , 1 7 2 . 5£ ' o , 3 0 6 ,8 2 5 .2 7 6 ,3 0 4 , 7 2 4 . 2 9 o,3u5 , 1 9 o . 3 i <.,«3 v .49 76.54 6 ,306,141.53 6 / 3 0 4 ,1 2 0 . 8 7 2/1.15.?u 2 ,0 9 0 .6 6 155.0U t l , O y C . ,'Ii &19.30 2, 197.29 o 9 9 .ll 1 0 1 , 190.75 6 ,262,285.17 6 ,3 8 6 , 5 7 2 . 3 2 1 , 6 j 7 .2 7 i . 5 0 0 .uO 6 , 3 8 8 , 4 3 5.0 5 •»93.o5 20. / I i t 0 0 0 .uO 6 ,3 6 8 , 8 0 3 . 7 0 6 , 3 o 8 , 824.41 6 ,3 9 0 , 8 2 4 . 4 1 1i), lDli.OD 4,400,-5?4.41 H i .Ou l.OuO .Ou OV ERDRAW N BA LA NC ES ARE MARKEC PIh m not* thal crdlto gacahwd allar •bov* tfJIfl donot appear an Rla alalatn C A Y . - * ; . I T E n - ' . A T I C m A L aA>\N T r . U i T C v j.-p A N Y L l * l T f J Cu^pOnATE , 0..JAN53 06J»N93 06 JA N 9 3 ' 0oJAN93 . 0 6 JA N V 3 . 07JAN93 : 07JAS93 31us.C92 : 31DEC921 I t JAN-*3 liJA N y J f 13JaN » !. 1j J a N»: lv jan v 3 J U a ’-y I 3 1 J t C 93 : 21J4 -93 2 1 j* N t Z » 2 2JA \ 9 3 2s JAi>93 2 5J * n 9 i 21JAN93 2 o JA N * i 26JAN92 26JAN‘>: 2 7JAN93 27JAN9? 29JAW 3 29j ANv I O lF iiy T 03r i393 JlF i?.y J 05F ci'»5 CSCi-.9! IN TH E EV EN T OF QUERIES PLEASE WRITE T O OUR INTERNAL A U O IT D EPARTM ENT. C/E COPY 04*»"• on AILS OATE AKCnIVE OoO S £ “’ v I l £ » & T0**' ' ? \ ' ■ : CV’ C o a P f i 5. •:;:•••; u-i> . a : . ? ■ -i.j; . cv ; •■ ' >.•.•:• • '' V..%. . . • . . .■ ' ........... . i♦*.• : „ rV"". , .Vi. -:QS37tU.' IRISH INTERCONTINENTAL BANK LTD. 91 TvJenion Square ■ " ra!?3s 2 OVERDRAWN BALANCES ARE MARKEO Plm u not* that credits nedwtd attor ( above dal* do not «ppmr on Ala statum .tir**- ■'; s f •■ •;/'* : 'T / O ' COi»l»Of?AVS' ;ATT:'l ■:;j (: «£. & . , I :• ^ Y & I E INTERCONT1NENTAI. BANX LTD. Si .\.'orien Square ' 2 •v . - a: , f : . TeK"r:icco: (01) 619744 33322 Fcssieiiic: (01)785034 • : ’ . ■■ . . ' STATEMENT DATE: ■ ;' G»(iAY93 B ALAN CE . 1 4 0 C792 1# 2 7 9 / 2 3 2 .9 7 •.20CCT..V2. . -26/441 .32 ^ :S;A ^,i/69;J.32 PR1 «sJis • n o / o o o .u o . 4/711/16/.62' 1/279/232.97 1/ 2 7 9 / 2 iZ .9 7 ■ ■ ..'1 / 1 6 5 „tf 4 i2^C T9 2 l" i Z i k C & Z ; 2?,'0.C;jr92' 260CT92 260 CT92 2 8 b C 192 28p. C:' f 92. 300CT92 K -l60CT-92 :f :s ■ ; U f •<- .**. •■ ••■• •§«• : *R( •,» „ . ^ ibSs 1 r v -0VS2 ; ;••... .iovw '.'■l6,2U 0.iiU ' . ?: 1 0 0 / 7 3 9 . u4 4 / 3 9 6 . .jO 1 / CJu J . 1/1 • •••., •> V»m-«gSS IsajeiK r i 1 -i 2 is 13 1 6 •" f • 1 2 2 ' '* C /.'I 6 5 *- K •*!. W I;lT.y 2 2 : . ..■‘ y , : r ^ 3 , W o .« 0 B 3 7 R I . ‘ , ' 7/24a/564i05 1 4 u / li U0 . Uu <’ > i u i ; / b o 4 . U ) ' 0 2 0 / 0 0 0 . Oo 1 25.IJU 0/422/949 .3 0 6 /402/949.30 6/401/U03.o 0 5 / 5 0 5 . uO QUO..; i.i 2/261.11 21 / 9 4 0 . U U r:'!;--U ' 7/24K/536.65 2 7.2U 1/2oU.2l’ •• ..’• vv r^ 'i''V v , • 2/Uuo.oi; 1 / 7 4 4 . 5U • 1 8 PI OV 9 2 ^ 1 7/25l;,932.aS VJ .*/ Li\ivj. ^.»J 31- 0 C T 9 2 .TONOV92 ■■T.1iM0,V9 2 il.t!0,V92 ....................... .. : n ; r j o r v 9 2 : 99&60 ?; ■13N0V92' t* .1; .13 MOV 9 2 A V- i (* '• i 7M0; V92 K 7 / 2 6 7 / 1 3 2 . as fT.il" j i 3. Vu AL ! S ;<:j=AS3 T ESPABTM Bn^s^fer^ 1 3 7 .0*2 219.23 100/789.04 :■ » Vi•’ . »£• ■ • k •i.JsOV92 £v '■ li" 310CTV 2 OZ. N0V9 2:03koy,92 03K0V. 92 02! N0V92 Q:3 ' « O V 9 2 04;H0V92 . .. ■'vr . 6/395/324.07 6/396/062 .9 6 6,3 7 4 /1 2 2 .9 6 OVERDRAWN BALANCES ARE MARKED D PIm m not* that credita rceaivad altar d» abov* dnt» do not apprcr on this (totmned OVERDRAWN BALANCES ARE MARKED 01 PJcjMKoto (iuileroifei itc^vsdafte,g* obav* dot* d o n a l apposr c n this c ta tm s n t V i ’s.1* TC.3K S'iTERCONTINENTAL. BANK LTD. 91M5sicn Sqnise Dublin 2 •' Teltiphons: (01) 619744 Telex: 33322 Facsimile: (01) 785034 . . ?***? •• ;■v :-; ■ '■■: STATEMENT DATE: : V a l u e >:r V- 'iV p A T E : ' '. ■, ■ ■ d ib it . ; r •; H 'V i y ■■ 1 3 .N 0 .’/ 9 2 : ' ■ CR ED IT. 0 6 1''AY 93 "' i ;. 4 9 4 . > 20NOV92 . B A LA N C E . • • 6 / 3 7 3 / 6 2 ^ .7 3 2 9 3 .9 3 6 /3 7 3 / 9 2 2 .6 6 3 6 5 .5 6 ,6 ,3 7 4 ,1 6 3 .2 2 ‘ 2 4 I J 0 .V ,9 2 :2 3 M v '9 2 7.5 H O W 2 = 2 5 .M 0 :V 9 2 '• 9 >5 U 0 .0ii . . 2 0 ,0 50 .;.;i 6 /3 4 4 /6 1 3 .2 2 •26H0V92 2 6 6 .4 o 26MGV92 2?- ' J .V 0 2 D E C 92 1 , 0 0 0 . t i i: ■. : 0 3 0 EC 9 2 O^S'u.EiC'9 2 ‘ ■ , • . 1/000.J-J 3 / 2 7 3 . it: , 6 / 433 . 1 : o . i 'o e 'c .9 2 7 ,51 5 r 31U .U 3 7 / 5 0 4 / o U 2.U 2 7 / 5 0 4 / 6 0 2 . U2 ■0.7. D E C 9 2 '. 0 ’6 0 E C 9 2 ' 1vJ,OUO.ii>> . 6Uti.6o 0.3DE:C92 7 / 4 9 4 / oil2 .0 2 x. • 136.5..' 0; 3 6 E :C 9 2. ' . .140.00 .O .a oEC92 '. . , ■ ' ' . *; 7 / 4 9 5 / 0 0 ^ .4 5 7 , u 1; 3 , 5 t i i . <*5 : rv .. •• , 2 ,0 3 2 .2 1 2 ,1 5 0 .0 0 I-' 7; ;'» : ■&; ’• _ 19.1'. .JQ N 0 V 9 2 € .•(•;•■.Aa lIITGRMAl IONAL‘ BAN'K : & Zr. r J ST CO.-IKAiMY..::lI;MXt EP ? P i:/u cu«po'rA.t-e'sen vie e.s •-sh>y i- •.. A;r r t ; i ^ e ; &n d H :^ ■~v. ' 6 ,3 9 4 » * a 4 . 52 ' '30N0.V92 ' 1 1 D Ir.C 9 2 ■ -1 ,5 2 7 .3 5 '• I S S ’. i . u ■ i » 15u ■ . 1 .■s o n o v v ?. ■3Ut)OV92 ■ 6 , 1 * 7 9 . ? / ' 2S/«'OVV2 0 3 .0 E C 9 2 ' ' 4 1 /7 5 7 .7 2 ./ ' OVERDRAW N B A LA N C ES AR E MARKED 1 PIs o m not® that credit* rocolvod «tts r It abovs data d o not a p p e a r on this atalsra* ■ ''• C/>-'- :'.i:: r<.-;",.‘’!’/:'f-iOfi'AX'-B.V-K C T;J'-'■>.T -;i; •"■'•• ; .:....; ii. ■ C.’V..;:. ^ r, : - , - . i :T '.v;;- ;;■ ' / n ';''^vK ,v:^v; ■. : •,.••\7.-i■•>*•.;/’V.•?V/'‘SV'? V'f.r-v• i m t f; ■ ; f t * ' r? v ‘• ' ; ' ;\ ■ . ..■* IRISH INTERCONTINENTAL BANK LTD. •? 91 Menion Square^ . ■■. •■ £ Dublin 2 . .*'•,-■■!:■,,.-. ■ :,’ telq)hone: (01) 619744:' *?': !-«Rsiot:Svtf ••" '33322 •>' ' •,•■..•:■•: ■■ Facstoule: "(01) 785034 : STATEMENT OATE: ■;06 pIAY93 CREDIT ’ BALANCE : ; , ;7;491/6b5.12 •. ■6 / 4 S 3 1 b 1 1 2 . a? 5/42a*4.6i iur.4ii 215.Ob 5/424/1 bVab3. 5 / 4 2 4 * 4&6 . 5/424/211 \ 2 f i 9 7 6 . ' ? S i-g si-zr o? cyaass :’:."i\Sv WR*T3 *cw crrswi. audit, caw: ■£ I'q<■ ■■ ■ ...•;. ^ !i i R Eo.M o.[40 S 37 a.l.''; :S^‘V>:r* '5*543/253.36 OVERORAWN BALANCES ARE MARKED 0 { * 3ft-v,;? *:?■.■ I t ! : ^ r « •' 'i-Vw #• ■ •> ;?' ':f' C;. r i>a -i I?) TERMATIOM/AL'.j.feAMK:\X - ".iV <:'^ST COMfiAlfiM^UWCTtifei.riV &■\h c/u c*.iiPoi)Ate';,se(i#cE.'fi :.!:v:^' # T-v u>iT .M . PIdsm nota that crodlla rscclvad aliar f t abova dal* do nol appear on this atsteoiaf \ I -Ith I CJ ■: f UC t 1■ ' I T* » • •I ; • ! 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DEPOSIT C/M.<111039., ' :'r ^y -31JAH9^ RENEWAL DEPOSIT; C / jl'SH K H O U'f’v i 2iyr*N92V, 21JAN9? ........ ;iANS^ACHEtXMtT6t>: ^ -■!I '■-s \ ;Vj ; C/ 0' C0RPtfRAT.E'; SERVICES V [>}?:' ^ATTN-^REDMOND;; ' " ' .........’ - • -,rg £ ■•• 'IiJ1•42» f j V-'i/'- v . ..................’ . ■ ' ‘. •• ■ ■ ■■■= , ' * W * ••> '^ '4 ’ •• :• • •>■: •> . ,.•:!••&4^^ ... ••:•• ‘ -'•;'v'i’i;‘:'''.: ■ -^ >\ L '= \; K ' Y lr’r»* -./,i :UMo.«0B37a.l. .STATEMENT a w so ach er l im it e d C/0 CORPORATE s e r v ic e s JS33H E*fTEKCCWnMHffrAL ©AfJKLTO.. fX C/N 645B5*" or 1 1 3539 u i t h W * W I ' OT .11 5*’ 38' LOD6SW6NTS DT 113537 LODGEMENT^ Ot 11S5S4 tODOSHSH-T^.^'iif -•• ■ O f 113535 I O 0 O S M N l% ^ ?rti *fc;.«6P' ‘ JV 1547(15 :0T :9 9 9 9 2 9 ^ i;! ^ ‘i :?* '' IMT * OJOST.MeNTVZJ.rZ-9 1 J10EC91 3 1 .1 2 .9 .1 ^ te r; jJ1D6C91 iO EPO SIf'M A f'C V N 999929 . •• I72JAM9? 22JAN92 f* C/M 645*53., ‘ . FX C/N 64SH54 . - I? ? JA * 9 ? ‘ 22JAH92 PEWFWAl DEPOSIT C/ll 319863 . 22JAM92. 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IS»n.No.40537B,l. ’ S T A T E 0 fla « r« # ••' I , W ; ly « ,* / C i n 2 /o in « 7 /a i J ••• °E P CL DEM NOW RES ■i?T ,f»J &.-J ' •.-■•• MOI 003 ■ if tp " :^ r n r n m VAIU*,;' 05FEO92 CJ6FEB92 07FEU92 I 10FEB92 l .C/H A4A238 ... ■ \ « p s& O5;F60i92 0'5«tf92; OAFE092? JV 11 *0n?',L004«nW ifal-:^i!if# V\ {•ENtrHAL OBP08i.OC>'MK99.972'«:1i?!lj:^ RENEWAL' OEPOl 0AFE992' 6 ,922.67 S S if M J .'I U 0y«.89'# 10F6893< RENEWAL OEPOSrf/ Ciffifr9999 Z S •<#{(tr-■■■i 10(56892 F X e / l l - /.A A S t f ! i I f c -m w i -t 10FE892; ? i ^ j :- i ^ 7 0 6 . n ( , A -i .lOF.6892j .^ ^ o a .n o 10>8892;; 10*„6092;: JV t tf?,GSl9Z: 11FED92 Fx r^93Av2.1i 12FEU92 FX 1 2FE892; IN TEREST 1f>EB92;: 1V-HJ92 DT A4A744 REVERSAL VO'"' 'M S ii] W INCORRCCT ■ , 'v .'.»;..;.'w':iV;5.: t i2 F E B 9 ^ ■(•', ii '- * • ) . CN 114(H1? L0086HRNT;'. i:.' 13F6B92 CW 11 59?$ LODSEHEWT^V^ , 13FE8921 r e v e r s a l cn i 13 9 * > - • . • ••!(8£ ,13FEB92 CN 11 39?5 LODGEMENT''^'";. ?:i.> 13F.E892:j 14 FEH92 R E h F U A I . DEP08IT: C/N- 990822 ' 1.A£6092*RSNfUAi. DEPOSIT 'cV>l 9908231*fE892, RENEWAL DBPOStr^t/N' 990*2*1- iv I ■1AFEB92.' 53.79 REMfiwAL . O.EPOSIiTw.c/M /.990825i -; !. 1AFEB92 3 E N E w * L ,. Df P0 St ^ ' C/ N 9-90 8 2 6 ! j ' '1 ' v 1AF8B92 fh c / u a ^ A s v i j . h / . M 14FEB92 if* c/ m;-6'aa'aj 9 . - 1AFEH92 93J.70 • i 0 T (.hisi*2 WITHDRAWAL ' ’ ; V ‘ ' 17FEB92 t 9 i . . 40 C/ H; K :9.99?4A"-'‘ . 'v ' ■' •­ : 14FEB92 14 3 * « 6 7 . l l f l 17 FEU92 f x i\-l : 17FfcB92 23.337.50 DT 111 .0 8 * . WITHDRAWAL v . ! 17 Ff II9? 2/000.00 DEPo;;i9i3: ... a/tto o * o o fM liai.is i^ 3 1 'i7 9 - "".Is * ' -l/i .^Q.'AS^3oi'iA8^ ' sfejtS]6«.1o " ;-')i5..a-i 230.60 1b.3ni*iA 3.92 tb.230»693.H« 1 •- O VZROAAW M O A L A N C IS A R 4 MAflKEO o r ^ P&WMfWt* BwlcwOsa wftrhsrteftw' ANRHACMSB LIM ITED C/n COHPORiTE SE R V IC E S ATTM B RtDMOHO ■■ -V. - i r ;. ■;;/•'•!' >‘ ‘ A T T N ., H HfeDHOW O Jfrk: v.; *:?. v • ;' '" 7 ;-'.‘• V . ' > .!■*'':••• v ’V ‘y1 "-''■ , • '0^-f • f..r v : •■ *£* ‘A - i p : . A : -■ "“ STATEMENT:' ^ANSBACHER ‘CtMITEO * ■■■: ■ . iV.C/O CORPORATE SERVI ••• • ■’ ■A- !r jr-^'ATTN R REDHON0 „ • • ,» • , . . *:s ' ' - '• ; : ‘ ' . ••r. •V"!M. ■!!“• "-v . - • ; ? PAGE NOi.;'004 l ’ OATE v. •y DETAILS 25FKB92 I EU92 • V!‘*.■. !■ y.iJ , /'.•.'f-,'.1*.? .&'•■ ! 14FEB<)2 18FEB92" .v'0T-',:114250 ••Vll.T.HoH'AWJl't.:-/-Ur 1 *fEB 9 2 i ^ or J S i i ' 3 b*'; .'wi r md ra u a l i ' •, ; i85E892(; :.?0Ti:iri^2Ai4‘;ii0to«:EM6NTx:i( > ’« 7 » i^;-. 1 8fEB92? OT wi 'j'4505" WX t HDRAW A L i f v ’ 18fEB92) 18>'E8*2 •OT 1142*5 L066NM6MT; OT 114307 L O O G E M iN T K 'g ^ ^ ' VU';. ■ l8 fE 8 9 2 i C/N 646571 *• ' ' .. • . *• : '• ' 'V - ' j ' /• j ’ •* ; .. i- • - -j.. BAUNCt ; CflfDIT , ,»•■?«• -> ,*--A • .^-y DE p0 S I T4>. fti0crt■ ■990824 24FEB92 ' J1, _ j i _ - * 21FEU92 i •• .v v 2UFEU92 .. *• -V* •. /* ’ '••• ■ ;• •' ■■■ . V FX ‘ t\ ' v'.-r. ' ;, . :?. ••• j A / C» ’ 02/01037/81 OEP CL OEM NON R E S : 19FEB92 .. A iv ’• • I UOFEU92 ' '7:- • ■■- T -y v r.‘ r <;-a ■■ ■■* ^ ’• ;-V:•- < KG.Ho. 40837 I U ■rid'''- -I.:.; kv.’ '■' 'ty- tS M S S K 1?'fE89'«. fX C/N 44C.57? ■ ' 19FEflf92; CN 114309 HITHDBAWA’L - ' . V ’r':. ■ . 20FE092 • CN 11435 A. W ITH D RAW AL;, -i'1 20/,EB9? 20FE897 BSM6HALvOBPOSI-Yc‘C/N -911865 ' i F X , C / N > ^ 5 7 3 ^ ^ ' . ’: t ‘- ? n f e m ? I? 1F E M9 7 . OT . 1l^baJiiitOOGIMeNT/: ■21 FE8^;» R B N E W ^ t f M P O i^ C / t t j l 110391 . !21FE092 »EN6UAt'$D.6P'6‘sM^C7Nr. 111040 ' 2ri FE( i 92 o e p o s w cvj^ 9 ^ i . 8 ^ - / ' ' j2«FPH9,> PENFUAl!:''B;6P0«it:;'C,/Ni 31 9863 !2iFEa«>2 RENl!ViALS;?'l>^'POS11fC ifU)319366 ];iF E H 9 ^ FX Cf N \ ■ ■ j2?FKa<>? CN 114372/ L00(iEM6NT,;. !. '. • j ? S F E :'l 9 ^ cn ;i ,i '437i ;;:w' it h d r a 'Wl : JV 156557 -R6 911*65 T#F T/A :? iif h ^ ; WENTj.TO'-“ IJOSTRO S/ O A/C I ? 5 F E B 9 'i? ; FX C/N.,f\646771 >]' ; 2 1 F F W9 ^ i FX C/»^9iiA767'-3 -‘A "• ' 25FI:«V^ j OEPOSJT'C/M 114373 ■ , 2ftFE»92 i CN 114538 !UITHDRAWAL ’ 26FETIV? I CN 11454(1 tbo'figMEIJT 2AFE392 ! CN 114541 LODGEMENT 26FE092 CN 1U5'.J9 WITHDRAWAL ' , 26FE092 INTEREST TO. 26FEB92 j n , noo.no I "fi.'ii'r.'- 4 , 5 2 9 . At '• - •■■•V. . , •.■ '.-,.'19.47 ' . ;:152.4S , . '■' A7 i 10 ; ln#433»726.i 5, J:. *■.*' V4 9,9Aft,585;i8 *45,399.97 •• 73*52 29.55 106.49 . 2’*91h • 66 1 1 5 .on » 11,350.69 1 1 6 .'iO 9>9AR>794.74, ! 4 3 4 ,n 4 9 .2 « 2 .0< i3 .V t 4n.f #4__ &A&223_______________ :___ ifiy- ’ . ' ' 11 ,494.07 .............. ...... i __ !ibi} UAfJJ 5.iAft_ IN T H E EVEN T O f QUERIES P U A S S W TO Tt T O O u n INTERNAL A U D IT DEP AR TM ENT. O V IW IU iM N BALANCES A H ! MAftKEO - . . . ' : ■ FlMMMM ttwUnHlll* mcJmdettMI in*naiappM M 0 /J 0 IflEn. No. *0337 3.1. STATii% 1EPIT . . AUS8ACHER LIMITED ’ C/0 CORPORATE SERV IC ES ATTN R REOMOND mm . 91Miafc3»$qMs« ■■0s&&j2 : • ' sA m ltd . ' ■• . ■ ■ ' D IIN K Ktgnuwu. .• ■ , • : :;x:.■ ■ ■ ••j,-.;:-.?• -i;' : •' iX:> ' r- v■ '>"■ = !. • .•■ :^v ; R IO. No. 40837 R.I. STATEMENT ifcWT,,-c#.MSBACHED; LIMITED .*:' ^ B « E R C O f T n N B N T A L 0 A M k L i t ) f ■■ *2 :;V V?J:IJ:U ' .• "• -v '7: iV"ATrN! RvREOHOHO:;i: ;,i.^.V ftf t :.: ,• -i'V / Ci\0 2 /0 1 087/ 8.1 >:A;V •?: : •:..:^.?v.‘ *.: \ .-•v* t ■ili •. * *< *L-k: -*">-..-.i-i1 ? >-. ' W : / ..:3^?»,vji-V- • :.*•.*% v^'41 -ai\.:, ^PAG*^ua*^Op» . ^i<: STATiMENroA7E,:-^i »®"^!;^: . , ..-•. ‘ •'hvwmW&&'■-fAfc' -' •. : VALue'.:.)' D A T! :^ j , P A T t 99 04MAR92 06MAR92 09MAR92 FX)‘T^N :JA 4 6 9 0 5 '% 1 4 •K5.;^ V / : ' ■ D T't'1 U 7 ’0 : 1u“0 ci CSE* fi N T } V b - 2 7 / 2 / 9 2 R EN EW A U ^ D BPb Si^ C /W , 999728 CN.' 11*757 LOiDGEHEHT FX C/t» A47159 1UMAR92 FX C/M *47702 . RENEWAL D EPO SIT C / N 119939 RFNEUAL D EPO SIT C / N 99997S 12MAR92 CN n S flO A WITHOKAWAU DT 115010 WITHDRAWAL FX C/M #.*7209 FX.'.CV.N A47212 . FX C/N -'.647213 ,l»R92 FX C/M: 647208 FX.C /N 647211 CN 115m fl WITHDRAWAL 16MAR92 OT 11513A LOOGEfEUT 18MAR92 RENEWAL Dft»OSIT C / U 990flZ1 Rf OT (tU7 : 1PM A u ^ ; 1?>*A»VZ i n f* A » 9 2 ! 13HAR92 . 1 AHA R V 7 ' : 1<.*>.Aa9Z ; 18MAS9? j 1 9 l'A » 9 2 i f 1 */"•/,'•( / ■>, ' *$ •'' • • .' \r . 4 ’ 9 ,9 1 0 ,2 1 1 .1 6 . “ ■'-;. 9,9SA,046.’78 v .. 9i9»6>779.00 9,94«S#05$^60 . 1*4.83 I ’.IHMARVS , -;a .‘ % \ 21#«.3 0.00 j ; 1I! MARV7 ■ ■v « :\r- io » :n o s^a-^y j.^ ■ \.iC-:;yt -i. :.«*■-sSiu;:?^ 31#1*ct»0b •f--.1n#on« . .. \K’ *“* Oitia 00 D6P0SIT ;;F/ * A C / N '.: 9 9 0 6 U Q :- i.«• CM 1 U 547‘*:.wi'T BtH6U*L 0 EPOS IT C/N 990602: w ,i-‘‘ 1 6 5 ;S J RENEW*l. ; DEPO.$XTi!C7.MJ 9 99.5 *6'i-.i. •.'■;'.: 7i n a 42 CM:^1 i'.K '^. k i% -, ^ ^ m k U flo o ^ o o . :: :/4 ‘ i*';; 2 IU E 8 9 2 28^6092: ■ :-:S y xa6iia5».ih CNT^.11 4683: WITHDRAWAL;-j-* ^ •>, ■’■:■' •■ -'''4, 656. *d! 2 8 FEB9 2 t xic/m?'is:4 * > o k v,'‘‘ '"v 03HAR92 NSW^C»:j ?AT8^:i^;'’B-10i'26(lri0d60 02MAH92 njM AR97 CH$1,U'*i^WMifMA’WAl ;>);•: >.,•■•}• ? 8 #80(1.00CN^lH*8Ai.tflTHDRAWALH;:h . I D . ilor i.oo 0 J H AR 9 1' i»< HA»V? CN; 1.14AA8 tUl.THDR AWAL; f ;-.1’ 5 #000. (10 J092 I ' .. CBEOIT ■><■ 2AFEII92. 26M B922 6 f8 B ^ 2 ( 28F.SB92i 2 8FE0921 ■»! •*.iiijV r-»-r*,V-! -r .•• •• •' • . • ‘ ■■ • *S% - ' 5. 7 ’'-r: ‘•■ ‘V-. ' -V?, ‘7 '• ........ '. •; • .•»v»‘.V. *. -.• ’ ••. .■ ■ ' i " , -‘ 11 :i: ->■* '!-■•■.-'i M i . m sn i ^ m it t c o w n N K W A L o a n k l t d # ' 8' )‘ • 91 Mci7i«4 . Vt&fito2 • * • : ; Aim«ACMER LINITEO C/0 CORPORATE; CORPORATE . SERVICES ,, • , , ; ATTN :« HeDHOND , O ATI 20HAR92 2JMAR92 ." • 1V-V-* '! 5 v A lU € ;"i'.: ! -. P A T t-t • ,4', ■■■•■'As ■ :v:r'c5«,*SM*;v,, -y. R E V E R S AI..,. 5 { V , W * •? PE OT 64742.1^.ANS8ACHB K\ L-T6 ,R E .';0T!<6 i i i 42IT'AiN#8AC^Cil. LTO RENEUA'Ufv0ei»d8T.1r.^ C /M iM V 0 aj6 DT v:1.15O h 00G6MEMTi’ •. :« m •'. R IN Ei/At; If 06 P08XT> C/ If* 1110 3.9 r i ne u au po¥p o 8 rr; •c /h * n i o a o n $ t iriqFP. 1 H H J IN TEREST TO 74HAB92 OT 1153*5 WITHDRAWAL DEPOSIT C/N 9 U 1 7 J >H92 DT 1 I 5 343 U lT H D P A JA L OT 1 1534? WITHDRAWAL' DT 1 15344 WITHDRAWAL Cll I 15151) LODGEMENT CN I 15349 WITHDRAWAL fX C/M 6 4 7 U 9 . CN 6474^1 T/F :. FX C/N >"599': 2AMAR92 FX C/M 647596 : 27MAR92 [DT 11 5 ?1 3 ' I. ODGEMENT OT 115 5 1 0 :WITHORAWAL 31MAR92 RENEWAL'‘DI-POSIT C/N 990002 OT 115514 WITHDRAWAL t>T 115513- WITHORAWAL . 0J. .1 J.5 U - L_H m a R A .W JH .._______ IN THE EVENT Of OUEPiliS PLEAUC WHIH TO OUR INTERNAL AUDIT DEPARTMENT, . :• ^ V(F.; -. • 19MAR.92 10MAR92 19MAR92 20HAR97 ?0MAR9/> '- 'if •'•! . h '?3«AK7? ' >. ■'} '; 'V ^ L £ it? ,n; n c i± OM IT :?vu»v;- j j j?*l*AI»9/ w s f if i s r - v r v - i 2«42S.fl1 5H« i . 4 i . . : .} lri/050,00 17 4 1'. * » 9 <1 1’J,75Z.OO ■ ja.4 4 a '-.' »» • Q:i:i ■■'■/M lli, V. ■ 9'#7*9>02'9U;4;' . »>>*9#056;i8.'; , 21.96 ' Mi.. 41: 14 7.20 j i Aiifl. t*t* \ ’ 74MA»' J>' l n . f h ’Z 'i? 1 l24l<*»<*Ml ap^eM on.Ms atatsm AHSIUCH6R LtniTk'O C/0 CORPORATE SE R V IC E S ATTN R REDMOND iftI_1.U5.Lt JUXH BJlAWAi. JLL9_*MQ ■UK T H I t V E N T O f O U fR ltS P U A O * W B IT I '■ j p s f y m m n r m . a u d it o s p a b tm in t. O V S R O flA W N B A IA M C 3 8 M S MAftXKD 01 .. • '& T •-' .•>'}• -'V/.r-v;;- -if:.--. ••• fVV:vf-V A-'.-.V-’'-'"5 .. o ;; v :s *j:„ STATEMENT i.i'-- . AMSUAC.tl-B L I * 1 T E D C / 0 CO R PO H A T E S E R V I C E S . ATTN » HE OMC. HO :' .•■'.• . r’.WV-. ■>',i F N TE 3 1 C 0 N TIN E N TA I. B A N K L T D . imZ’ A . 91 Marion 3qjw« P " * '. I 'f. i '. /c i DEP ■ r.2 /m o 8 > /8 l Cl . OEM NUN --—“ OATI f i t •i ' ri0 t ‘ f ■* y ^ 007 ' VMLUt. * o w r! : ..DATf:" '•') •\f •' •;* ■’ : ,;v •■■■■'%■■ ’’r.‘ 31HAB92 •.’ i‘ A ;'o o b .o o J1 K A R 9 ? r... ;5 > o5 o.r,o i1 » A # 9 2 ' ' ' j’ -'v'. ' ' 3 1MA H9 ? 31 ;•' V■ ■. DUbEe?- \ ■,H .V'•■'>'?• •) i-')-;7; ; . !>* TrAsp&w*: (01) 619744; <' a r f- ■' i / ? e f 5 i ANSBACHER LIM IT E D i '. C/0 CORPORATE S E R V IC E S ^ . ATTN » REOMONO ■}.,> Ittft. N o . / 0 5 3 7 A.I/» v.., '■-tw ' ■• • i , BALANC8 >..j,'*. ' .. ' ' ■ * • •• 1 * 0 0 0 .0 0 # 2 *7 0 7 .7 1 ?5 # * 9 7 ?.4 0 * ? 3 2 * 7 2 6 .5 3 . ■ ' ... . ' ./ ■ ■ ■' • . j ,. . ► ••• •. ... • • >• , •/ v ’: •»**' , s .. r i»»» ww2 i79^2 S b 1V 99 *8 6 7» *0 11MA R9 ^ & ¥ 'V •T B c s r# 10 . 3 3 001J 0 0 0 B S P O S IT iC / N :9 $ V « A J • . • D5P0GIT>! F/A C/N 991865 ,'t FX 'C /N 947842 : FX.“ C/N.' 947843 . • * ' JV ' 1 567(15: RB I NT •A 6 J TO 31/3 M C/N 6478*7 . DEPOSIT C/M 994373 DEPOSIT f / A C/N 914373 FX C/N «479tt? FX C . / U h/.793a FX C/N 6'./Vtt9 MENfcuAL DHP0 S IT C/N 999728 CN ■ ; 1 S 5 1A LODGEMENT JV 1511067 RE CHARGES R f. JA N Ftn I U R RE HT 115 7 A 5 WITHDRAWAL FX C /ll. 6/.T990 FX C/H 647V93 . FX C/H 647994 RENEWAL D EPO SIT C/N 119939 RENEWAL OI-POSIT C/N 999925 C fLJJ5 > 3 7 ...T /F M B S LODGEMENT 0 1 Al> 0 9 1 I M Al*«9/ 01 A P R ? ? 01 APR9U(). 5 'i • > 7 * 5 0 0 .0 0 1 » ? H . IS ' ; ;■; ' v, ■ ... ■■ ■ ’ v ; ■ 4 i.U 3 9 9 .9 7 4 4 5 ;3 9 9 .9 7 1* h / < . . 0 0 I0 # 3 0 7 .n o . 9 * 8 0 0 * 4 7 0 .1 6 ' / • 1 1 » 7 5 0 .n « 4 U 6 »5 4 1 .4 7 ?,7i ' ! 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No. 40B37IU • 1:- '' y, • i S T A r E M S W T :'l ; -: 'ANSHACMEtT LIMITED • C/O CORPORATE SERVICES atth r beohono;. ■"r ■ 0 2 /oip877«i> O OP KWSMINTEHCOWTIMENTALBANKLTD.! 9? m S q u a m :' •;?V'V ‘ ■■'.y ■ ■ i'.kh’; ' • . • '-'-r' \-.r uir.t ■ X t P*ftE MO* tint 008I i ;v:V - ’ ";■) !" M T A IL S V A lU f O ATI [ I .10APP97 > : 1Sap *92 113APR92 14APR92 . 10APR92 14APR92 14APR92 16 APR9 2 l6iAP#9? 16APR?? 16APR92 16APR92 115APR9? 21APR9? i j3APR92 1 14APR92 15APR92 CN.'i 15926?ilOOGE WENT CN 115933 LODGEMENT CN 115V40 LODGEDIUT . FX C/N 648778 DT 11 5930 WITHDRAWAL RE DT, 115950 WITHDRAWAL HE DT 11*1151 LODGEMENT: 01 6 i.8 ?B6 ,Re.;:;AN*0ACHER. ' •.'5i" ■;r T0 REVER8is?-6NT.BYiif«.{ ;■ - • to^ rev«rs 6; j n Vry^ V ',: ''‘v-'.-; •••.•• ■?!' o n U t t s i * - *'• V." 16APR92 2 1 A PR 9 J TO.VlREVIRSE i-ENTRY ‘ • •" DT *1.16055 LODGEMENT " : RENEWAL,';0KP08JT C/N 990821 HffllHWAL* DBPOltt,T.: C/H 99)103 RENEWAL DEP08r,V'it C/N . 190836 . . 22APR92 REHJV. 156978 0'T164829 3 W/DRAW 2 JA P R 9 2 REN EU A LtD EP.O SiT 'C /N 1 1 1039 •••■ r"*-RENEWAL-DEP081T C/N 111040 HE' DT 1-16075 ‘WITHDRAWAL RE;=DT 116073 LODGEMENT INTEREST: .TO • Z3APR92 ’ FX C/N '6 4 8 2 9 8 . FX C/N 648299 . : 24APR92 FX C/N 648796 DT 116507 UITMDRAWAL DT 116074 WITHDRAWAL . DT 116301 WITHDRAWAL DT 116313 HE C/N 3 1 9 6*3 /3 1 9 8 66 T/FER 27APR92 OT 116315 LODGEMENT DT 1163(19 WITHDRAWAL 0T .11 6308 WITHDRAWAL ML4_.HU.VLft ________ IN TH E E V tN T OF QUIH1S3 PLEASE W RITS T O O U R INTERNAL A U D IT O fP A R T M IN T . oew •_ • ■• . • cmcrr'-’.' c/o ’ <■ ... '-s: i?4APR92 iZ7APR92 IZ7APR92 i27AP«?Z ' 'V'’> ,672i2S ; :9/78A>323'.7i. , 50/129.29 i /a o o /o n n .u o ... , . . -,. V.' . ' : /’• ,! • i*‘ ; ■ . ••■'■•‘ v 470.09 ii 11/5 8 0 ,1 3 7 .4 0 •' -r '■ ••■*/•* . ' 319.8-9 '.I: ?/ ■. . 678.34 / ■'V■ ‘ * * '■<•!i*f ■ ■ . ‘ '. ■■■■ 18**70.00 30.000.00 .6 /3 1 S«A9 319.59 319.89 678.34 '/..-IV,: 'LV5#152^37 21APR9X 21APR92 22APR92 23APR92 73APR9? 23APR92 73APR9? 73APR97 23APR92 73APR92 24APR92 74APR92 74APR92‘ 24APR92 i,' ;■ : 11>5A4>969#tttt 'i • ■ ■f 7V>;.f;t*via#5o*.2v 11/An9*413.07 11/6 0 9 /3 0 2 .7 8 116.-30 . ' - ■t , 30/066.46 110.29' A-9.16 : : ' . A18.H2 7/179.49 107:74 143.66 ,i ■ 11 11*64^/886.09 : 1 1 ,414/832.77 1/191.01 '2* / 184 .76 678.72 16 4 .1 V 2 # 9 1 6 .6 6 78/795.00 28? 795.00 155.00 11*560/004.43 o v tn o n A w N balan ces a m m ark to PtMM not* Owl BMdll* m i>w’>v-‘ rHSXSv; "■yr-y.. „■V1.V• v** ’ 290CT9?■(**, v .'Y 1•''* OEP CL0£H DE»NOW BfcS •j. v; .vvl'i ' ‘ {./, L 1M I T E Ii corporate ATT/J R R E D M O N D se n vices mi t p p t a r on OtUalsMmx ANSIIACH6* LIMIT60 ’■■■■ * C / 0 CORPOHATC:SERVICES ATTN R REDMONO ■ » • : 1 R t R .N o .4 0 S 3 7 N . I , ■ ■''t: STATEMENT ' .!?'• ••:i n u s a A c m x l im it e d C/.O CORPORATE SERVICE'S - •.;• • ' ■:■'■• ' . - -f/. . ' CiSMJN'TZSCOtmMSNTALBAWKLTD, ■ ATTN R REDMOND TtehjiSww(01)619744 ? Totsn.‘: : IV 33322 VFaoialle: (01)73S034 :S ''- ■ A'/'C t ii£‘p 02/01047/81 CL D E I/' ■ B fS 11O'? . i * DETAILS r > ” : •” ' ^v;.y ocarr VALUE O A T I V- .j/;.' j f» C/M 648901 .■ V " UT I t ASM R8?.ANSBACHER; :;HAPR9Z FX C7N .648902,.$. -V'. FX’ C/N;648903 ;. * • FX*:C/ N?648904j.si;' /a •■*! 30APR92 JV.^11*325-iJXTHORAWAL^■ r-_-> '< KSfa UA'iiftDEPOSU :C/ N' ?90Dn2 •;> 01MAY92 JVAl,16532Mi008.6HENT j ;, ' ?. U5MAY92 JV-/1l653Jif/WITHDRAWAL ' ‘ J V>il 16534 ,.UI.T.HO.«*w*l b . nn(1rtI>, NEW' CR-'1RA.T V"'I • RENEWACJj PEPOSIT' C/M. 993590 •;•..• I JVM5716^ CHAR6ES! RE APRIL ,i . ' . 06HAY92 CMC116540: T/F 'RBSv ,;;, cm;:i 1.454.1 withdrawal. CN<116542, LODGEMENT 07HAY9J MBN6WAL D E P O S IT ■C/M 99972# n C/H 6485.15 AY92 R EN EW A L'D EPO SIT C/N ‘119939 £ RENEW AL-DEPOSIT C/N 99992S RENEWAL D EPO SIT C/M, 999600 FX C/N 648522 V ' FX C/N- 64H523 : • JV 649196 RE AUR8ACMfcR KTD REVERSAL RE J V 649196 . REVERSA L’ RE. J V 649196 ‘ R E V E R S A L V ' ' „ JV 649196 RE ANSBACHER LTD 18HAY92 FX C/N 649197 FX C/N 6*9198 2UMAY92 J V . 116880 UITHORAWAL JV 116881 LODGEMENT REHFkAt. DEPOSIT C/N 999865 _____ F» c/i. 6u ___i__:______~ IN THE EVENT Of QUEMI.r, PLEArt WRITE TO OUR INTERNAL AUOiT DEPARTMENT. ' •• -V “ * ' 4 r hi }S ~ ' paceno J '".‘y ; 27APR92 2i7Al»R92 ?8APrt92 2MAPR92 28APB92 30APR92 30APR92 30APR92 0SHAY92 n5MAY9? 01MAY92 OSMA Y.92 04HAY.92 06HAY92 0AMAY92 0SMAY92 07MAY92 07MAY9? 11MAY92 11HAY9? 13MAY9? UM AY92 14MAY92 1AMAY92 18MAY92 18HAY92 18HAY92 18MAY92 18MAY92 1HHAY92 20MAY92 20MAY92 20MAY92 20MAY92 vr -. •" : - V v -r.“ CA2DIT- - ' balan ce V::.. . ■■ -i.; ■Jf’. .';'.441'.S7' 18»348iflO ■' llEO.No. 40S37IU. ■ J!;i I f #008.»0 -'366.96 f 'i t i w # j 4 s a * 7 i '. . >5#ooo.no ,^ 5 :» o . 1 1 # 5 ii» 6 6 4 ^ ii;. 11#524#664.61 1/000.00 2o#nso.no ; 1 ,S< .4 .K .' j i 294.19 I 15 S . 5 i 4 5 0 « n a 0 .n fl ; ; 11 # 5 0 3 /2 0 8 ^ 3 ; 1#000.0(1 i 3/92A.70 1»943.77 t#37b.«0 : 1 8 # 2 4 0 .n 0 . 5*600.011 114.61 125.6b t/2 3 2 i8 « > H#n56>700.40 11>n56>960,67, • 11#(15«;193.55 11#034#J53.55 i6 . m , 11 #n?•• . “;iv ;•••■' ’. t- ri i •. . •• >je v • ■ ' -V•* .* .-r • '■'ys* ■ ••>4- .•S T A T E M E N T S ■VA.NIS9ACHER1 LIMITED ' ■ '^ ;:c '/ 0 "C 0 R f» 0 R A T E ; S E R V IC E S :;;;- " m J S « d Ite P ” oats • i.; n-* . .f v : r f i f f i S S _______________ _____:•__ •- ■ • *• --it •< • ; ,V Aiue : . • OATE • ■>— D E B IT . ■■f c rc o iT ; bai ancb '.H: : I ' 21MAY92: 32MAY92 f X^C/.N * 4 4 9 4 * 9 ; ? : ^ ; ! ; ; e ;:* - # ? * RENEWAir .^'66POSI f C7M i-190836;. >; . F X .C/ N l-J> J V . 157327 STO PPIN G CHEQUE . v jv 26HAY92 1168 VA iODaenniiT D EPO SIT C/N 194373 D EPO SIT C/M 9110JV D EPO SIT F/A C/M 99437$ RENEWAL D EPO SIT C/ l l 19V17S RENEWAL D EPO SIT C/ U ’I I K U V RENEWAL DfcPOSlT C/U 7111)4 0 RENEWAL DKPO SIT C/U 91 9 86 3 . JV 11710* WITHDRAWAL ^ .' JV 1 171 13: LODGEMENT JV 1171.1 2:'.Ut j MDR AUAL >' . F X ,:C / N ^ 9 4 3 3 ,1 ^ ,^ ,: V ^ -S lNTEBESTVT,or,;:37MAr92 • •• JV "1S 7339V,CHARGES , R6 ST O PPIN G CHEQUEi'- ^ ih - ^ ^ y - :;?' . / ’ •■■■ AY92 RENEWAL' D EPO SIT C/N 9995«A J V . '1 1 7 1 2 1 'LODGEMENT ' JV 117120-.L0DGEMEMT AY92 DT 11*90O’ LODGEMENT' ' RENEWAL DEPOSIT. C/N 990002 DT 117308' LODGEMENT . JV 140071- VAL 230492 Rfc 911039 ANSHACIIER ,TRF V 0 300*92 i : / . 9 .7 7 0 0 0 0 0 0 0 2J UN92 NEW CH.HATE 03JUM92 0T 1 17321- LODGEMENT OT 11 731.9< WITHDRAWAL ' DT 117320 WITHDRAWAL " JV 15M79I PAYMENT TO (301 27MAY 92 !?(>MAY92 I21HAY9? 71MAY9? i ?1 «A Y 9 2 ,71i*AY9? ) :3083.3.1 i S » 1 6 9 .2 5 I '1ni # 2 *>> « 8.2 i 7 9. . ",7A0.17 6 - Wfi I ! • •.’ ’ i’ ' :v 145.87 1*000.00 1U*139.50 5*000.00 '■ 25.24 44*460.61 28MAY92 736«69H .59 221.69 10*000.00 10#2»7#636.V^' . ,.v iV V. 5v «. • i *•i ■*•. > ’ 1 0 ,? 7 a #942‘. J 3 , 11 *0A3» 12A.7.7 11*043*126.77 1*500*480.23 11 *0'5A«828»69. :, :OVEnOIW ,W VNBAl>NCI3AW MAB(tED '. .'HSHACMER L I M I T E O C/0 CORPORATE S E R V I C E S ATTN R REDMOND RF.fi. No. 4 0S 37 H .I. ' 1 7 *0 0 0 .0 0 1 *5 0 0 *0 0 0 .0 0 IN THE EVENT OF QUERIES PUMkSK WRITE -. TO OUR INTEANAL AUDIT, DEPAnTMENT. f 10*259/818.23 *ji';'6o 29MAY92 ,3JiL*YJLZ. ' 410*145«35 1 0 0 .8 6 29MAY92 29MAY92 0 ? J UII92 D3JUM92 03JUN 92 0 3JUN 92 I12JUM92 2"'ipi>94V393.99;:\ - 103.09 ;:V/io,'994;st>3iii>-' 1i.191.01 ■ * 2;.'.uo 4in»145.3S 736*698.59 *.73 r - PIm m Mt» 0 mI m4IM Vi m 1wi< i Dm 1 >Ku... Mo. 40837 R.l. r - : ; :7:k : ^ *STATES^EftlT Vv?;'- icr> h h ite o ;; ; i .- ■ IPO#ATI;SCUVXCES;.;V .mohoho. ; ^ : (1 fl:« X‘ ••• >.V« ■?V ; 0EPr:CL>: 06M MON-:»es . •«••/.jV $VV?*., "! ••■•- V, ■*:.’ • •V;^PASE:fN0i-;i011/\ :f- v :: • VALUE*.., DATE ••• • fa.H■ DATE s, ^ f.-.v •; *•■*;•.? >.V*y &>r i* •. ,UM92. DEPOSIT F /A JC y M ^ I.1 0 3 9 t >.,;&% w JU N 9 2 IN tER 6 iSn T 0 ;s- 0 5 ilJW 9 2 /.i;;;.:::r t H ‘i-REMEUAL' D EPO SIT VC/.H :;993590* JV 158863 CHARGES RE . WAY •ii- V ) CN 117325 LODGEMENT •• <’ . 'V .' UuJU N92 D T 1 1 7 5 ? « WITHDRAWAL RENEWAL D EPO SIT C/M 999728 .; v 0 9JU N 9 2 DT 911039 TRANSFER VD 26/5 DT' 117542 WITHDRAWAL DT 117543 LODGEMENT DT 117540 LODGEMENT 1 ' DT 117540 LODGEMENT •1UJUN92 OT 11735 WITHDRAWAL ’ FX C/N 649747. DT 1 1 75411 WITHORAWAL : 11JUN 92 DT 117546 WITHDRAWAL. : • ' RENEWAL DEPOSIT, C/Nr-119939 : RENEWAL DEP0SI1P;C/N :;999925 ; RE . J V . 1666O6t/RBV-J0F '\\DT. 1175 35 FX»-C/n ? :6 A 9 7 i6 f e ;j'" ;" ' s' 15J UN92 f*?C/M'-f->*50'i'54^'^n^ -* ' : "• i 16JUN92 DT :1 17675? WITHDRAWAL . .. ' * V . '' FX- : C/N;650'l55":-'.; -l'iV: J'> 17JUN92 R E :>DT.'-'.11:781 3'"-tfITHDR AWAL . ,>• RE.; DT. 65tl1 57 WITHDRAWAL' . REVERSAL;'!.;'.. ... ■ RE:. DT' 6501 57 ANSBACHER LTD ' (,.. 4UN92 FXv-C/N , 650159 , • . . . ■ . ' •' .• ‘ / ' . FXV C/N;!; 650160 • ' . p V JUN92 RE.-0T.-.i'l7»ii. LODflEMNET 22JUN92 RENEWAL D EPO SIT C/N 99IJ8Z1 1 , ' ' ’ ■ FX C/N i 650167 FX-C/N. 650168 t " 2.5J_UN92 FX C/N 650170 . . 31MAV97 05JUM92 0 5 JIJN 9 ? 05JUN 92 0 1 JU N 9 7 O liJUH92 f!iU 1.11497 0 5 JU I4 9 ? f)9 J U HV 2 09JUN 92 09 JilN 9 ^ (I’M 0149? 10JIJI492 10JUN92 10JUN92 11JUN 92 11.JUN9? 11JU N 9 2 10JUMJ)?11JUH92 15 JIJN 9 2 16JUU92 1 6 JU N 9 ? 17JIJM 92 17JUN 92 17JUN92 1 7 JIJH 9 7 18JUN92. 1 8 JIJN 9 2 19 JIIN 92 72JUN92 22JUN92 77JUN 92 23 JIJN92 ' s'l••* •' v ' ..■■-I- -. ' .'i i ■ " *”•*. rv’ ' ■ ■ *y<. i i ; o 3 6 ; a 2 8 . 6 ^ ^ jr ,..74 3# 1 5'T .S'2 ; ■ly-: '1 i »i77.9’#9!86«.0;V?'.':.: : 7,?.o3-i65, • A vV* t<*{■'■&} ?' ji i"K'> ' i... ' • ■ *; >■ . - 1 / 7 .1 0 .' ■. - ' ■ " ‘ ■\i 3 ,0 0 8 .4 6 ■& (■. 1’1V7'9 (1i»2 i'O •#.#/.; '■ A # 0 5 0.0 0 K'i 7 4 3 ,1 5 7 .J2 2 2 1 .6 9 ■ - • . i 4 2 .3 6 4 ,6 0 4 .0 0 4 ,2 3 6 .0 0 3 6 ,4 9 7 .7 8 - ' •:. .. . V * j• •• * 4 ,5 H ’ .91 . . '!•••'' ••’ ' ’•! 11" • .. v'.v. ;'r 3 0 8 .5 2 ' p . 158.62, 11.^043,851 .'94 . ■'■[. ■’■ ’■' • ' * ’*■'f* J •« '".•** i;i. ■ ' ' i ‘ ' ’ . *• t< ;■ 1 1 ,0 3 4 i.9 6 9 .5 8 1 s’ ' v, ' 4 2 ,8 2 6 .1 0 •* ■ .• '• . /«.' i V / ,6 2 6 .7 2 • ', v^1••v*' . ' f.A.. 4 ?.3 6 y -A'#/.1'’■ 13 7 .4 5 9 ,i7 i;n o ,,2 # 9 « 4 .? 1 ••#609.00 34.(10 1 1 5 .2 2 f 1 1 ,0 4 0 * 1 d * . 4 3 • . •* 11 iO S 9 “*933'.4r.3 *'• ■. ~y: ‘ - >■ i’ ■' ;. j 115-22 1 1 5 .2 2 1 8 ,2 9 4 *0 0 ? , 7 u 4 . 10 ! j I •■■■■ ' 11*78 2.#.17, S it 9o'.;V ' ' ; '7 7 6 LOO •'■53,545.89 " 1 3 3 .1 2 : 9 9 .8 5 ■' / : , t i .'•/ •'•• • •' : ’ ■>.', V- . ’«’**•j.! j. in o .ij^ i^ i.o o ' *'•'?.■‘ 1 1 * 0 1 1 * 1 5 2 .9 0 }/ 11 *011 *9 2 8 .9 0 ,. " ' .•;.; !•" \• 9 ^ 0 9 9 .0 0 11 ,0 6 ^ * 7 0 7 .7 6 ’ 1 1 ,0 5 6 * 6 0 8 .7 6 ■IN THE EVENT OF OUCRIEB PLEASB WRITE ; TO OUR INTERNAL AUOIT DEPARTMENT. OVERDRAWN BALANCES AffE MARKEO Hm m Ml* thrtsndlu roeotvod« Mr I •fcovxferf* do no* vppaM on thl* M M t 4ANSEhUHER L IM IT E D C/0 CORPORATE S E R V IC E S ATTN It REDMOND . f- . < • '. ' REG. No. 40S37 R.l. STATEMENT AIJSUACHER L IM IT E D C/0 CORPORATE SERVICES'. AX71) fl REDMOND IRfSfJ .TTTE)''iCONTJNENT/\L BANK-LTD. 93 h&jrian Square ■ ■ E^tSin2 ■ , .. • • •" ATTN R RSOHONU' • . . • ■ -r ■‘'ly St\>4 tf-': TOO. No. 40537 R.l. t . 'STATEMENT ANSBACHER LIMITED i ' :V C/O CORPORATE SERVICES.','' £.,: ; attm », redmond;^ ■ 'V , IRISHINTERCOiNTlNENrrAi. BANKLTD. Merrier) Sviuc ' ' ■ .. ■ ■ vi;• ' i ;3 :f} \ i (:■* '..'. A/cT'n'2/01087/BI • j*/• ;; DSP CL' ofi.M NOM,,Rfi$C. ' " .v':-1 •* . ^ P A O S D ATE N 0 » ; _ 0 1 2 ; •:! f' .'■ ’ 5JUN92 26JUM92 3UJUM92 FX C/N 65 ni7 1 w f''.;'i-.?^ .: J V 11796? WITMOR.AWAL i . :;:,K FX C/M *5»480'<;-M:~'.~"V-''-. K JV 1179*1 WITHDRAWAL ,;" ; P J V 117U11 LODGEMENT J V 1179AA LODGEMENT FX C/M *50175* •‘ JV 117969 WITHDRAWAL . JV-.11757D L00GEH5UT J V 11797? lOOGEMEUT D EPO SIT C/N 1179 66 J V 1 1 7 9 6 5 .WITHDRAWAL J V 117971 WITHDRAWAL JV 1 17974 WITHDRAWAL FX C/N 6511481 . HE DT 117814 LODGEMENT RENEWAL D EPO SIT C/N 9 1 9 **5 J V 11«n»4 LODGEMENT JV 11«n.13 LOOGEMEUT RENEWAL D EPO SIT C/N 990002. IN T ER EST TO 30JUH 92 V. . . JV* . ' V. OETAILS /)H9 2 ■K- . ■..'• VALUE' date . ■ >,; ! '- . ■ c' • ■ 23JUM92 23JUM92 23JUM92 i ?4JUH9? :?4JU»9? ■ I74JUN9? IP4JUN92 . j ? 4 J UH9 2 :;'4 jll«9? ,?4JUN97 I12JUH9? ' ? >JUN92 :?SJUN97 •0« JIHI92 ?5 IIIN97 26JIJN9? 26JUN9? •' 30JUNO? 30JIIN92 • 30JUN9? 30JUN9? >o o w r^ v ^ r '' • : 4,094.55 7,500.00 .; /'/O.nO 6 5 8 .bn ' ‘ ' . • •• ' . ■ v* ■ :: '• ■. • BAUMJCt; v y- V 11 #(146 #224 • 21 V‘■■' -‘■ : ■' ■'/ . -- 1*: 34 •00 4i9#96D.OO ■V-V"-"'??•: i::*'. '• 'i‘ ‘ J t1 .l3 i.9 0 4,352*nA 42,700.45 155.00 894.91 317.24 2#noo.no crsoiT < ■ • • ■’ ■w 7 ; ■* ; 290.58- • .' i . f* J• . "* , • • ■ v ■' ■•> * • *T ' ■■ ' ‘ i • V■; * !” . ' '! . * r 11,3?8#642.04 tV. s,nrio.oo 3.23 ^ 835.33 1 , non.oo 22 .4 6 . 261#f76.86 ’ . / 11> 3l\#645.27 yV i. o ■. . • • V" •• t■. '■ ’/• :.:;i1#596#97Ti?2; • • •: •• mj . • ’ / "’ ’>('‘ ..* ' • *. • IN T K f EVENT OF QUIHIES PUEA«« WRIT'. TO O im INTERNAL AUDIT DEPARTMENT. ' ' - O VanerU W N BALANCES APICMAAIUO . PIm m n»la (hot crtdlla neatvad «n m V •beva dnta do not sppw r an ttila ilakm i ANSBACHER L IM IT E D C/0 CORl>CRATE S E R V IC E S ATTN R REDMOND /■"V ■ICO. No. 40B37R.I. STAT(E?J3ENT . ARAX LTD ' . C/0 CORPORATE S E R V IC E S . DEPT imSHJKJTERCON-n^lTALBANKtm 91 J.fetaS " ! CR DR : -B A L A N C E 9,763,427.58 2,074.77 9,761,352.81 9,764,352.81 9,766,452.07 9,775,066.30 9,775,836.00 9,775,941.03 9J74.628.53 9,771,928.53 9,761,878.53 9,756,828.53 9,756,065.06 9,737^555.06 9,726i305.06 9,725,941.41 9,725,015.91 9,715,760.91 9,711,133.41 9,708,358.41 9,694^483.41 9,690,483.41 2.376 60 9,692,860.01 9^92,278.89 2.346.33 9,69.4^625.22 9.69^.605.57 1,323.29 9,695,928.86 ...... 9,693,607^86 9,693,482.86 j 9,684,191.86 i 9,676,691.86 I 255.83 j 9,676,947.69 9,676,608.51 I 3,000.00 2,099.26 8,614.23 769.70 105.03 1,312.50 2,700.00 10,050.00 5,050.00 763.47 18,510.00 11,250.00 363.65 925.50 9,255.00 4,627.50 2,775.00 13,875.00 4,000.00 581.12 19.65 2,321.00 125.00 9,291.00 7,500.00 339.18 ’ Oclcalc 23-Ocl 23-Ocl 23-Ocl 23-Oct 23-Ocl 23-Ocl 23-Ocl 23-Ocl 29-Oct 29-Oct 29-Oct 29-Oct 29-Oct 30-0cl 30-0cl 31-Oct 31 -Oct 31-Oct 31-Oct 31-Oct 23-OctjCN 111057 Trf from A/C: 02/01062/81 23-Oct CN 111056 Trf from A/C: 02/01062/81 23-Oct CN 111106 Lodgement O/O Ansbacher Ltd 23-Oct CN 643490 Withdrawal IFO Gilbeys of Ireland Ltd 23-Oct CN 643490 Withdrawal IFO Bank of Ireland 23-Oct CN 111082 Withdrawal IFO American Express 23-Oct CN 111081 Withdrawal IFO 23-Oct CN 111083 Withdrawal IFO Ansbacher Grand Caymen 29-Oct CN 150582 Withdrawal 29-Oct CN 110995 Lodgement 29-Oct CN 111276 Withdrawal IFO Park Street Securities Ltd 25-Oct CN 111136 Withdrawal 25-Oct CN 111135 Lodgement 30-0cl CN 111052 Lodgement O/O Kalon Grp. 8. Assoc. Brit. Eng. 30-0cl CN 111051 Lodgement O/O Assoc. Fisheries & Casket PLC 24-Oct CN 111176 Withdrawal IFO AIB (C.I) A/C No: 11158833 31-Oct CN 111282 Withdrawal IFO College Trustees 31-Oct CN 150410 Trf to A/C: 02/01947/77 31-Oct CN 111281 Withdrawal IFO Mr: R.H. Chambers 31-Oct Renewal Dep C/N: 990002 ' 16,561.50 588.101 522,457.79 8,607.43 4,627.50 1,186.78 4,005.06 150,000.00 2,083.33 1,087.661 450,000.00 155.00 2,916.66 45.00 60.36 200,000.00 2,312.14 25,000.00 20,000.00 2.35 10,104,246.89 10,104,834.99 10.627,292.78 10,618,685.36 10,614,057.86 10,612,871.08 10,608,866.02 10,458,866.02 10,456,782.69 10,457,870.35 10,007,870.35 10,007,715.35 10.010,632.01 10,010,677.01 10,010,737.37 9,810,737.37 9,808,425.23 9,783,425.23 9,763,425.23 9,763,427.58 o ) Octcatc S T A T E M E N T OF A C C O U N T 02/01087/81 FOR O C TO B E R P O STIN G D A TE O1-Oct 01-Oct 0 3 -0 c t 0 3 -0 c t 0 2 -0 c t 0 3 -0 c t 0 3 -0 c t 0 4 -0 c t 0 7 -0 c t OB-Oct OB-Oct OB-Oct 0 9 -0 c t 11-Oct 11-Oct 14-Oct 14-Oct V A LU E DETAILS D A TE O1-Oct CN 110484 Withdrawal IFO Clyde Enterprises 01-Oct Lodgement CN 642B95 W ithdrawal IFO Guinness & Mahon CN 642896 W ithdrawal IFO Mrs. C. Griffin CN 642828 W ithdrawal IFO Business Enterprises CN 110500 W ithdrawal IFO Mr. R. H. Chambers CN 110499 W ithdrawal IFO Colonial M utual Group CN 642831 W ithdrawal CN 110438 Lodgem ent CN 110439 Tfr to A /C No: 02/01062/81 CN 110440 Tfr to A/C No: 02/02991/77 CN 110261 Lodgement CN 110751 W ithdrawal IFO A nsbacher L td W ithdraw al CN 642991 W ithdrawal CN 110436 Lodgem ent ' CN 110437 Lodgement 15-Oct CN 110920 Trf to A/C: 02/01062/81 0 3 -0 c t 0 3 -0 c t OZ-Oct 0 3 -0 c t 0 3 -0 c t 0 4-0c t O j-O ct 0 7 -0 c t OB-Oct OB-Oct 0 9 -0 c t 11-Oct 11-Oct 14-Oct 14-Oct 15-Oct 15-Oct 15-Oct CN 110919 Trf from A/C: 02/01062/81 15-Oct 15-Oct CN 110483 W ithdrawal IFO A nsbacher L td 16-Oct 18-Oct 18-Oct 18-Oct 21-Oct 21-Oct 22-Oct 22-Oct 22-Oct 23-Oct 23-Oct 23-Oct 23-Oct 23-Oct 23-Oct 23-Oct 23-Oct 17-Oct 18-Oct 18-Oct 18-Oct 21-Oct 21-Oct 22-Oct 22-Oct 22-bct 21-Oct 21 Oci 22-Oct 22-Oct 22-Oct 22-Oct 22-Oct 23-Oct CN CN CN CN CN CN CN CN CN CN CN CN CN CN CN CN CN 110963 Withdrawal IFO Rogers Aviation Sales 110918 Trf to A/C: 02/01062/81 110811 Trf from A/C: 02/01062/81 110991 Withdrawal IFO American Express 111041 Lodgement 150006 Withdrawal IFO Ansbacher Grand Caymen 643293 Lodgement 0/0 CRH 109249 Withdrawal 643444 Withdrawal IFO Bank or Ireland 643491 Withdrawal 643492 Withdrawal 111105 Trf from A/C: 02/01062/81 111104 Trf from A/C: 02/01062/81 111103 Trf from A/C: 02/01062/81 111079 trf to A/C: 02/01062/81 111102 Trf to A/C: 02/01062/81 111055 Trf from A/C: 02/01062/81 . 1 10,588,606.71 DR 25,000.00 Ij CR j • 90.96I 4,842.62 918.50 46125 950.00 98.68 6,299.90 15,000.00 15,000.00 100,000.00 459.00 1,000.00 3,810.32 30,000.00 21,250.00 1,000.00 18,285.00 8,700.00 19,773.11 3,000.00 158.62 2,409.49 135,042.18 522,329.00 245.37 1,655.28 9,255.00 112.11 149.48 275.00 1,388.09 6,326.78 17,000.00 5,189.26 .... ... I 14,491.06 BALANCE 10,563,606.71 10,563,697.67 10,558,855.05 10,557,936.55 10,557,475.30 10,556,525.30 10,556,426.62 10,562,726.52 10,577,726.52 10,562,726.52 10,462,726.52 10,463,185.52 10’462,185.52 10,462,185.52 10,465,995.84 10,495,995.84 10,517,245.84 10,516,245.84 10,534i530!84 10,543,230.84 10,523,457.73 10,520,457.73 10,520,616.35 10,518,206.86 10,653,249.04 10,130*920.04 10,131,165.41 10,129,510.13 10,120,255.13 10,120,367.24 ioiiidisie:^ 10;120J91.72 10,1221179.81 10,128,506.59 10,111,506.59 10,106,317.33 10,120,808.39 ‘■•V■ O V ER O A A W * RALANC1S W E M ARXEO 0 * J"""** *■*•*■** w«ii»h« wi Ms 3 L Na. 40197R J .' 4 ........■ STATEMENT. • <■ • . * .f •■ 1 ANSBACHER L I M I T E D . C/0 CORPORATE SERVICE.! IRISH INTERCONTINENTAL BANK LTD. 91 Motion Square Dublin 2 Telephone: (01)619744 Tek*: 33322 Factimile: (01) 7SS034 - •• - .. A/Cl, 02/01087/81 CEP'CL .,1 ■j*' . DEM NON RES PAGE NO: UOt OATS . DETAILS . ' 27JUM91 bROUGHT FORWARD •. J V 143281 .‘JE- CR RATE 1 1 .1875 • .* TRANSFER FROM 02010078(1 J V 107613 WITHDRAWAL ■ -• JV 107612 UITHORAWAL JV . 1U7610 Wl-TMOMAWAI • J V 1U7611 WITHDRAWAL ■ ' '• i * * ■ DT 639320 REVERSAL I FX:C/N 939320' ' I . * DEPUS I T C/N -990002 . DEPOSIT C/K 990600 !’ • - DEPOSIT C/N 990821 ' • DEPOSIT C/N 990822 DEPOSIT C/N 99U823 . ’ r * DEPOSIT C/N 99082<. DEPOSIT C/N 990825 I • , DEPOSIT.: C/N '>90826 • DEPOSIT ’. C/N V93589 . ■ DEPOSIT C/N 993590' DEPOSIT.-C/N 995103 ’ D E P O S I T . C/N 99940^ ■ • ■ v¥ • DEPOSIT C/N 99972B ■i. ■ DEPOSIT C/N 999729 DEPOSIT C/N 999925 2SJUN91 J V " 1 4211 (i TRANSFER FHOM 02-01087-38 TO 02-J1U87-81 ANSlsACHE.t L IM IT E D ' •’ RENE..AL J E P O S I T C/U 990002 ; • 1 JV 141487 RE A/C T / f E R •. ■ ! JV 1-14.io RE A/C T/FER w j u u 9 i : ntc- :6ST TO 3 0 J U NV 1 i S T ATEMENT OATE: VALUE OAT* 26JUN91 27J J N 9 1 27J JN91 27JUN91 27JUN91 2 5 JJN 9 1 25J UN91 31KAY91 31 h A Y 91 1 7JU!!91 31MAY91 31 !1A Y91 31HAY91 31MAY91 31 ^AY91 31HAY91 0 5 J U M91 31MAY91 31IIAY91 24JUN91 31MAY91 0 o J U N51 27JUN91 2UJUNV1 27JUI.91 20JIKIV1 3 0 JU N 9 I OEBIT CREDIT 19N0V91 BALANCE 1 1 / 1 2 3 / 9 2 1 .9 2 I 7 5 0 .0 0 2 / 5 U J.U O 1 5 /0 0 0 .0 0 9 / 2 5 3 .6 3 7 55.2 9 6 7 9 .7 6 95 *8 9 7 .9 5 S 0 / 0 0 0 . ou 2 00/000.0 0 3 82/499.2 2 37 *7 2 3 .9 9 4 u / 4 9 7 .6 2 2 6 /998.4 2 2 6 / 9 9 b .* 2 6 0 0 * 0 0 0 . UO 46 9 /009.4 0 25 6 /2 2 5 .0 0 1/330/113.71 91 /5 2 0 .7 4 2 9 1 /7 6 0 .2 0 5 4 3 /276.2 9 6/65 3 */5 5■6U '*>442*536.90 ! V J.U 5 4/41.2/566.96 <« >>4 4 2 * 5 8 6 . 9 6 2 9 J/V 4 5 .U 2 11/ U 9 6 / 3 6 1 .81 11/ 3 9 U / 3 0 6 .8 3 ! ■ ■ yTHE I auEHIIS EVENT OR PLEASE WRITE 3 OUR INTERNAL AUOIT OEPARTMCNT, OVERORAWN BALANCES ARE MARKED Or Mmm nex Bmi andlti r«—l»«d in*r th« •.lev* M l* 4o M l *P9«ar on Ittli «ui«nw\i ANSBACHER L IM I T E D C/0 CORPORATE S E R V IC E S I 5 «C ». h o . 4 0 S 3 7 R .I. STATEMENT A.^SPACHE* L I .*•t T 5 D C/3 CORPORA Te S e R V i ; a / c : r .a / m IR IS H IN T 91 M e m o n D u b lin 2 T e le p h o n e : T e le * : F a c s im ile : .5 o 7 / s i E R C O N T IN E N T A L B A N K L T D . S q u a re (0 1 )6 1 9 7 4 4 33322 (0 1 )7 8 3 0 3 4 5 !J P 0 E P CL Oct‘r « 0 « RES S TA TE M E N T O A TE. PAGE KO: PJ1<. DETAILS O A T* > “‘XSEP91 jBROUGHT POPJARO 1EP91 ;jV 11i<133 LODGEMENT : j v 1103i.» WITHDRAWAL ■UT 11037? WITHDRAWAL J 7 S I P 9 1 , 5 T DT 1103111 11 >'37(> WTHDRAUAL U I T H D P A w A l. ■ : R E MKu AL DEPOSIT C/N 9 9 9 7 i3 3 0 S E P 5 1 i j v 110675 w i t h d r a w a l ;J V 11P47& -ITHDPAWAL i j V 11.■>*7," i o o « e m f : o : JV 110477 LODGEMENT •RENEWAL DEPOSIT C /*- Tf UCi l Z ■INTEREST TO 30SEP91 value O A TE 2 A K E P V 1 2 o S r P 9 1 2o Se P < 5 1 2 7 S H> 51 ? ?SEP< >1 i ? S E a 91 , < u S E P 9 J 3;)Si;a.-;i ■Jii'.r.*'? ! JiiSi *’V1 3i’S CP9 1 5-'Sk5>S1 D E B IT C R E D IT BALANCE ; - 2 >'v. ti s • ii 133. i}i> 11 13 * '/'lUUa!i^ 1 *w / it # j i ■ 4 i /’#i• i • n f ** ■•/ j ; luU.f.c ?i. • i / ► iv%0 \ };'• V IN T H E E '.S M T O f C U ER IES P LEA S E W R ITE T O O U R iK TE R N A L A U D I* O E P A H T M E N T . O V E R D R A W N B A L A N C E S ARE M A R K E C ’ Plaaaa noI t that c ra d lla racaivad itta r t> a b o va data d o n o t a p p a a t an lh\» M a la m a :;i5 i-iC » E » 1.1 n I T E ’ c/o coHPij?irt SEhVir.cS R E G . N o. 4 0 5 3 7 .R .I. STATEM ENT 5.!J v'Af.HfR UTl' !RrSH INTERCONTINENTAL BANK LTD Appendix **»lkl*TCO TO «UIMN(tl MAMOM * CO. WTO. UOMOO* «>T»»WI>M«Q t»3Q * 01nccTOMs JOMMH. OUINNCSS 6H4IMMAM WILOAMO. L. KORWQOO MAHAGINQ J. DC9MON0 TMAVNONUAMARINO MAUMICKC. O’tOCLLTMAMAUIMO NOBINQ.ClAPMAM JAMCS , A* *. aUlNNCU MtaCUP. BCWtOHf J. CLAYTONLOV*. JNH. MAMOVa W. XVCRITT OANICUT*O'eONMOR A. PCTIft «. OUlNNIlt MieHACLJ. FCNOCH SC6RCTAMV ■OCMALOC. J. MeCWACKIH 17, C o l l e g e G r e e n . DUBLIN. 2 P. O. BOX 55A REGISTERED OFFICE TCLCGRAM&: MARS. OUBUN TKLCX : 8209 TCLI^HONC: OUBL1N 7*2444 RCO. NO. 10 2 1 a -M r. c /o D .H .A . C e c il, P O 'D /J B C . D . A le x a n d e r , 21, W i l t o n P l a c e , L O N D O N S. W .I 2 5 th M a r c h , 1975 D e a r S ir , W e r e f e r t o r e c e n t n e g o t ia t io n s a n d n o w w r i t e to c o n f i r m t h a t w e a r e p r e p a r e d to m a k e a v a ila b le to y o u b r id g in g fin a n c e , s u b j e c t t o t h e f o l l o w i n g t e r m s a n d c o n d it io n s Ctntra1 6ank The meting was held to discuss one particular aspect of the bank's offshore activities which was of concern to the Bank. Mr. Daly commenced by saying that the Bank recognised that a significant proportion of International banking business Is conducted through offshore centres and that, 1n this regard, the Bank did not have a concern about this type of banking business being conducted by Guinness and Mahon Limited 1n these centres,through Its subsidiary company in the Cayman Islands and Its affiliated bank In the Channel Islands. The Bank's concern related solely to the fact that Guinness Si Mahon United has advanced loans in excess of £5 million to customers which were secured, partly or wholly, by deposits placed in these banks through discretionary trusts. Mr. Daly said that because of the complex manner in which the loans are secured and the secrecy surrounding the existence of the security the Bank could see no logical reason for the arrangements other than to assist customers to avoid taxation. The Sank was of the view that It Is not appropriate for a bank to be engaged 1n such a significant way 1n tax avoidance schemes. H r. Traynor mentioned that discretionary trusts are used for a large number of legitimate reasons. They are used extensively by the multi-national companies as a means of transferring assets from one country to another. They had also been used extensively In this country in the past as a legitimate method of reducing Estate Duty liability. With regard to the loans granted by Guinness A Mahon Limited to which Mr. Daly referred, Mr. Traynor said that he wished to emphasise that all of these loans represent genuine banking loans, which,with the possible exception of one loan amounting to £400,000;the bank would have been quite satisfied to advance w*th the existence of the "Cash Deposit" as part of the security. He was quite confident that all of the loans would be fully recovered without recourse to the “ Cash Deposit*. Mr. Traynor stressed that -in all cases, the cash deposits were placed 1n the offshore bank before the loan was advanced to the borrower 1n Dublin. There was no question of the bank advancing loans to be placed on deposit 1n the offshore banks. ^ *m A 4 I * 4 L U /o/a/ 1 * (r*” . At 33 Oecember 1977 the bank's free resources ratio, on a group basis, amounted to 9.9 per cent, which was 0.1 per cent, below the minimum required by the Bank. Representations have been made to the Bank ^ . ^ claiming that certain Items (which at 31 December 1977 amounted to approximately 15.3 m illion) should be excluded from risk assets when calculating the ratio. , i j , The effect of excluding these items from risk assets at 31 Oecember 1977 would be to increase the free resources ra tio / to 12.1 per cent. J? rh**n r* r The items which the bank claims should be excluded from risk assets are . as follows;, ' / / (1) I f C6k loans by Guinness > Mahon Limited (G & M) "secured" by cash deposits In Guinness & Hahon Cayman Trust limited (GMCT) and Guinness & Hahon Channel Islands limited (GMCI) The method by which these loans are secured Is complicated and 1s d esig n ed as a tax avoidance scheme. The procedure is that funds are transferred to the Cayman Islands and the Channel Islands (Guernsey) to a registered discretionary trust of which CHCT/GMCI* are the trustees. The trust 1s controlled by GMCT/GMCI. A wholly owned and controlled company is formed by the trust. This company places on deposit with the Cayman/Guernsey bank an amount equal to a sum to be advanced by G & M (Dublin). Before the advance is Issued by the Dublin office the Cayman/ Guernsey company signs an agreement with GMCT/GMCI which stipulates that in the event of the borrower fa iling to meet his commitments to the 0ub1in Office GHCT/GMCI has the right to forfeit a sun from the deposit ■ - tclu3* t0 ar,y loss incurred by the Dublin office on the loan. ^GMCT/GMCI may transfer the forfeited deposit to the credit of the Dublin office by way of dividend. . • No evidence of the agreements between the Cabman/Guernsey company and the Cayman/Guernsey bank is maintained at the Dublin office^purely as a precaution against a physical inspection of the bank's affairs by the Revenue Conmissloners. However, in order to satisfy the bank's auditors as to the adequacy of the security on the loans Mr. Traynor, during the course of the bank's annual audited,personally,brings the agreements from Cayman/Guernsey, The auditors inspect the agreements but do not take notes of their contents. GMCT 1s a wholly owned subsidiary of Guinness & Mahon (Dublin) and GMC1 is a wholly owned subsidiary of Guinness Mahon (London). Appendix IV (a) GMCT audited accounts - Profit & Loss accounts 1972 - 1987 (b) GMCT audited accounts - Balance Sheets 1971 - 1987 ) ) GUINNESS MAHON CAYMAN TRUST LTD AUDITED ACCOUNTS PROFIT & LOSS ACCOUNTS (Amounts in Sterling £000) 31-Mar 31-Mar 31-Mar 31-Mar 31-Mar 31-Mar 31-Mar 1972 1973 1974 1975 1976 1977 1978 30-Apr 30-Apr 30-Apr 1979 1980 1981 30-Apr 1982 30-Sep 30-Sep 30-Sep 30-Sep 30-Sep 1983 1984 1986 1985 1987 NET BANKING REVENUE 16 30 52 119 209 275 94 252 503 607 976 1,766 1,296 1,621 1,499 1,652 OTHER INCOME 45 64 153 125 189 200 233 338 380 519 804 1,338 1,298 1,338 1,232 1,368 61 94 205 244 398 475 327 590 883 1,126 1,779 3,104 2,594 2,959 2,731 3,020 1 0 0 2 2 21 10 5 1 0 0 8 6 18 315 352 695 18 27 398 571 1,014 26 39 639 1,197 1,901 26 71 477 1,262 1,836 42 146 540 1,517 2,245 39 159 486 1,344 2,028 30 162 564 1,392 2,148 55 765 1,203 758 714 703 872 765 1,203 758 714 703 872 EXPENSES Auditor's remuneration Depreciation Directors emoluments Other expenses OPERATING PROFIT 2 5 8 10 8 9 37 62 4 58 55 119 98 131 242 85 143 125 156 Dividend from subsidiary Extraordinary interest NET PROFIT 85 261 8 113 164 295 15 145 196 364 9 13 332 214 568 180 87 226 315 431 189 51 504 482 20 118 55 8 13 52 167 240 125 176 180 87 226 -- GUINNESS MAHON CAYMAN TRUST LTD AUDITED ACCOUNTS BALANCE SHEETS (Amounts in Starling £000) 31-Mar 31-Mar 31-Mar 1971 1972 1973 31-Mar 30-Apr 30-Apr 30-Apr 30-Apr 30-Sep 30-Sep 30-Sep 30-Sep 30-Sep 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 20 38 37 46 48 43 38 105 111 157 603 585 491 344 0 0 0 0 0 0 0 0 0 0 31-Mar 31-Mar 31-Mar 31-Mar Fixed assets and investments Fixed assets Investment in subsidiary companies 1 4 18 101 15 0 0 22 32 32 32 32 32 0 0 0 1,173 1,544 1,544 1,544 1,544 1 4 18 143 85 69 79 81 76 38 105 112 1,329 2,147 2,129 2,035 1,888 Investments Current assets Cash at banks 8 52 55 1,131 1,343 2,363 3,298 4,557 7,150 10,145 8,599 4,732 1,652 1,273 173 1,449 2,665 GM Dublin 0 3,672 5,616 6,316 5,224 3,435 2,903 3,331 4,924 7,662 9,397 26,980 30,971 25,154 25,853 39,392 55,964 GM London 0 2,008 136 764 303 5,040 8,698 9,060 13,594 24,300 34,867 61,596 92,280 129,888 128,233 126,139 81,209 Loans to customers 0 1,290 845 367 3,316 4,418 5,664 5,081 4,409 3,839 13,127 24,715 40,541 50,055 9,177 12,234 14,802 932 Interest receivable 0 0 0 15 26 112 152 0 435 854 1,463 3,117 1,606 2,269 1,773 1,209 Sundry debtors 1 14 3 5 17 17 16 0 17 36 53 35 976 59 64 23 18 9 7,036 6,655 8,598 10,229 15,385 20,731 22,029 30,530 46,835 67,506 121,175 167,147 208,699 165,273 180,446 155,590 Current liabilities 31-Mar 31-Mar 31-Mar 31-Mar 30-Apr 30-Apr 30-Apr 30-Apr 30-Sep 30-Sep 30-Sep 30-Sep 30-Sep 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 149,408 31-Mar 31-Mar 31-Mar 31-Mar Customer deposits 0 5,680 5,673 8,239 9,627 14,387 19,632 20,924 28,936 44,171 63,833 115,811 163,019 203,937 160,486 175,317 Loans from banks 0 1,282 842 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest payable 0 0 0 35 94 164 178 157 330 656 1,231 2,690 1,260 1,952 1,279 855 642 Sundry creditors 0 14 8 23 57 92 107 48 132 335 353 376 585 586 551 519 767 Bank overdraft 0 0 0 0 0 98 0 0 0 0 0 0 0 0 0 0 0 Subsidiary companies 0 0 0 33 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6,976 6,523 8,330 9,778 14,741 19,917 21,130 29,399 45,162 65,417 118,877 164,864 206,475 162,316 176,691 150,817 9 60 132 268 451 644 814 899 1,131 1,673 2,089 2,298 2,283 2,224 2,957 3,755 4,773 10 64 150 411 536 713 893 980 1,207 1,711 2,194 2,410 3,612 4,371 5,086 5,790 6,661 Net current assets Net assets Financed by: 10 10 10 100 250 250 250 250 250 500 500 1,000 1,000 1,000 1,000 1,000 1,000 Profit & loss account 0 54 140 311 36 88 143 230 457 461 395 410 1,612 3,371 3,086 3,790 4,661 General reserve 0 0 0 0 125 125 125 125 125 125 750 0 0 0 1,000 0 0 Contingency reserve 0 0 0 0 125 250 375 375 375 625 549 0 0 0 0 0 0 Balance on consolidation 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Reserves 0 0 0 0 0 0 0 0 0 0 0 1,000 1,000 0 0 1,000 1,000 10 64 150 411 536 713 893 980 1,207 1,711 2,194 2,410 3,612 4,371 5,086 5,790 6,661 2,281 2,782 1,449 1,357 2,187 10,631 21,985 34,329 38,759 Share capital Hypothecated deposits Appendix IX (a) Henry Ansbacher Memo dated 12 November 1991: Fraser Jennings - Richard Fenhalls (b) Henry Ansbacher Memo dated 14 November 1991, Richard Fenhalls - Fraser Jennings (c) Extracts of minutes of Henry Ansbacher audit and compliance committees, 29 January 1992, 28 April 1992, 29 July 1992; extracts o f minutes of meetings of Henry Ansbacher Board of Directors, 29 January 1992, 29 July 1992 (d) Fax 16 September 1992, SF Jennings/KM McAuliffe - RD Fenhalls/JM Button (e) File note o f Tim Ridley 17 September 1992 (f) KPMG Peat Marwick management letter dated 30 October 1992 (g) Memo dated 2 October 1991, Richard Fenhalls - Dublin File Appendixlx HENBX ANSBACHER S CO. LIMITED: INTERNAL MEMORANDUM TO: Richard Fenhalls FROM: Fraser Jennings DATE: 12 November 1991 SUBJECT: Offshore Operations Further to your note 12.11.91, you should be aware that my concerns relate to two separate areas of the business. Firstly the way in which loans are booked, documented and monitored in Cayman, (a review and finding completed by J Button is attached) and in turn uncertainty relating to documentation of back to backs highlighted by the SM deals. The second issue relates to matters arising from Peat's Management letter raised at October's Audit and Compliance meeting specifically in respect of Des Traynor's operation of the 'Dublin Accounts' from Dublin. I have discussed this with Des, who made the following observations: 1. The concern that he is the sole signature is fatuous as they are his clients and practically there is no one else to perform the task. 2. Documentation and records are maintained to a high standard and kept on a PC which' is kept current by an ex G S M employee on a part time basis, (someone DT has known for some years and has a high regard for). 3. Concerns over instructions relating .to the accounts are unfounded given the longstanding and personal nature of the relationships involved. 4. The request that all documentation be reviewed in London was totally unacceptable given the rules of secrecy governing the Cayman Accounts. In summary I would say that there is real reason for concern over some of the operating procedures I have referred to and that are evidenced in J Button's report, these have been identified and it is up to John Button to ensure that they are effectively dealt ,with. /2 On a broader note, I feel we must accept and respect the secrecy attached to the offshore accounts which by definition cannot be subjected to all the tests and scrutiny that might apply in the UK, but in doing so recognise the trust and responsibility empowered to offshore's senior executives to ensure that their activities are at all times in compliance with both the relevant regulating bodies and the bank's own rules of conduct. SFJ/AEH \ \I AppendixIX . H E N R Y A N S B A C H E R / S 7 j . I N T E R N A L M E M O R A N D U M R ich a rd F a n h a lls iaa/ecc j .jpA "■ 0a“ ’ . ^ ' - F r a s e r J en n in g s John B u t t o n cc: f - I n t e r n a l A u d it R azort - 14 November 1 9 9 1 . " D u b lin A c c o u n ts " Thank y o u f o r y o u r n o t a o f November 1 2 , 1 9 9 1 . P u t q u i t a b l u n t l y , I a c c e p t t h s e x p l a n a t i o n g i v e n by Des T ra yn or. I f i n d i t i n c o n c e i v a b l e t o make t h e a s s u m p t i o n t h a t t h e Chainaan o f I r e l a n d ' s l a r g e s t company, d i r e c t o r o f a number o f p r e s t i g i o u s I r i s h c o m p a n ie s , a d v i s e r t o t h e good and g r e a t i n D u b li n and a p p r o v e d by t h e C e n t r a l Bank o f I r e l a n d t o be a f i t and p r o p e r p e r s o n t o run a Bank w o u ld b e c o n d u c t i n g i m p r o p e r , i l l e g a l o r c l a n d e s t i n e a c t i v i t i e s co n tra ry t o th e l a v . What I s u g g e s t we do t o p u t an end t o t h e s i t u a t i o n i s as f o l l o w s : . • I p r o p o s e t h a t y o u and John B utton v i s i t D e s , g o t h r o u g h what he d o e s , how he d o e s i t a n d we a d v i s e t h e A u d it C o m m ittee and t h e A u d i t o r s t h e r e a f t e r t h a t we a r e s a t i s f i e d w i t h t h e p o s i t i o n o v e r a l l ( i f we a r e ) . I f y ou want me t o t a l k t o Des a b o u t i t , I w i l l . r . R ich ard F e n h a l l s . H is r d f 0 1 9 4 8 .mem ■ H hnrt A n s b a c h e r & Co. Limited Appendix Minutes of a meeting of the com bined'Audit & Compliance Committees held at One Mitre Square, London EC3A 5AN on Wednesday 29th January 1992 at 09.GO am Present: O.J. Sebire - in the Chair O.S.G. Adam P. Ballard J-0 Calmes (from Ite/n S) W.L.S. Guinness (from Item 2.3) M. Tilmant In attendance: 0. Catt S.F. Jennings M. Mayhew-Arnold O.C. Matthews P.R. Thom P.G. Greenhalgh - Secretary MINUTES OF PREVIOUS MEETINGS . The Minutes of the meeting* held on 30th October 1991 wgre approved for signature by the Chairman. ' 13.0 Dublin Accounts The Chairman drew to the attention of the Committee the paper from Ansbacher Limited regarding the percentage of accounts which had not been signed off. It is not clear from the letter 4hd previous correspondence:-* 1 how many such "Dublin" accounts there are, how many of these accounts have not been reconciled within the last 12 months, 24 months etc. SFJ advised that he would look into this matter and advise the Committee of the position. Ai 19.■ Minutes of a mesting of the combined Audit & Compliance Committees held at Cne Mitre Square. London EC3A 5AN on Tuesday 28th April 1S92 at 3.00 om Present: O.J. Sebire - in the Chair P. 8 allard W.L.S. Guinness • M. Tilmant In attendance: M. Mayhew-Arnold D.C. Matthews P.J. Remington P.R. .Thom P.G. Greenhalgh - Secretary APOLOGIES FOR ABSENCE Apologies for absence were received from D.S.G. Adam. S.F. Jennings and D. Catt. % X MINUTES OF PREVIOUS MEETINGS The Minutes of the meeting held on 29th January 1992 were approved for signature by the Chairman. 3 11 (29.1.92) 2.5 Oublin Accr-.its PGG raocftac tha-: 3FJ r a ; id'.-is ad that ha and John Button ware having axiansivs talks with Des Traync-r .vhilsis^e was in Cay mar regarding the structure, documentation and lavai c: detailed ihformation an fiie !.n Cayman in respect of chase accounts. S rJ aiso aavisad that they w^re satisfied that the business was bona fide. PGG had been advised tha: Kevin McAuliffe had reviewed the accounts in Oublin and is satisfied with the standards of control and documentation. The Committee asked to be provided with a written report by KMcA which should also address security (physical) aspects, access to documentation and the position regarding mandates. Minutes of a meeting of the combined Audit & Compliance Committee held at One Mitre Square, London EC3A 5AN '• on Wednesday 29 July 1992 at 09.30 Present: D.J. Sebire - in the Chair D.S.G. Adam W.LS. Guinness P. Ballard In attendance: S.F. P.R. P.J. P.G. 1. Jennings ' Thom Remington Greenhalgh - Secretary APOLOGIES FOR ABSENCE . Apologies for absence were noted from M. Tilmant and J-O. Calmes. M. MayhewArnold's absence on medical grounds was noted and the Chairman asked that the Com mittee's best wishes for a speedy recovery be conveyed to MMA. 2. MINUTES OF PREVIOUS MEETING ^ The minutes of the meeting held on 28 April 1992 were approved for signature by the Chairman. v 6.3.2. Dublin Accounts SFJ advised the Committee that he and Mr. Button had now discussed these accounts with Mr. Traynor and basically there were two issues which need to be "considered:' _ • the accounts are controlled exclusively by Mr. Traynor with the Cayman books being only a reflection of the Dublin position which operate under the^sole signing authority of Mr. Traynor. SFJ advised that this was the exception; all other Cayman authorities required authorising by two staff. _ .. • a number of the trusts are "blind trusts" where discretion largely rests with Mr. Traynor; this structure creates risk which SFJ advised is • under review. In summary SFJ advised the Committee that the position was recognised by management who were considering the matter. In the meantime SFJ sjated that he did not consider that the Dublin business constituted a "terminal' risk to the Cayman operation. PRT885.repPGG. -3 - r The question of the Oublin accounts- had initially been raised in the .-Peats 1990 Management letter and SFJ. advised. in reply to a query raised by DSGA. that he was not aware of the current views of Peats. As Peats had not re-visited this matter it was assumed that their earlier concerns had been allayed. 6.3.3 Management Latter . S r j advised the Ccmmittee that the computer al! ether matters been addressed, developments pending the outcome of current Group. 5.3.4 with -:ne exception of che back-up facility for raise:: in the iS3* Management Letter had in respect of the computer were s u s p e n d e d discussions w!:r, potential purchasers of the _ Organisations.' Structure SFJ advised tna: :.-.= interna! structure has r.ow oeer. re-organised; Committee will be provided with details. :he Staff resources have been increasec and SFJ reported that in particular the new Financial Ccn:;oller is proving effective. Segregation of banking and trust business is now largely completed with only 23 out of 417 banking facilities now remaining outside Banking. 6.3.5 Banking Facilities SFJ confirmed that the half yearly review was currently in hand but reminded the Committee that the majority of loans are related to trusts. T h e f l B V facility has been reviewed; SFJ confirmed that security values are considered to be realistic and provide adequate coVer for the exposure. \ SFJ confirmed that the large exposure was in respect of the SAF facility which is reducing. In reply to a question regarding the integrity of the structure of the loan and the relative security SFJ advised that opinions have been sought from accountants and lawyers and that whilst not entirely risk free the documentation and security appear water-tight; the commercial risk is considered to be minimal. On the question of back-to-back documentation SFJ advised that in the absence of case law the position was inconclusive however Cayman were attempting to move from Memorandum of Deposit to a Flawed Asset position which improves the value of the Security. . I , j 'v ^ SFJ undertook to provide the Committee with the' Cayman procedural •. documentation in respect of the Philippine fiduciary business. j ' t ! N ' 6.3.6 ' Limit; Barclays Bank Pic SFJ explained that whilst the bank in general was cutting back on lending lines to banks the Barclays limit of ElOOm, although three times greater than the next largest limit was realistic in view of the quality of Barclays. In this connection SFJ mentioned that the 8ank of England were satisfied with the allocation of limits. ' ' . . The Committee commented that Barclays rating had dropped significantly and that it would be pru.dent to relate the limit marked to those marked for other banks. The Chairman advised that he would raise the matter at the HA Board. PRT885.repPGG. -4- HZHRY ANSBACHER & CO. LIMITED ------------------------------------ -- ^ c< £ Minutes a t a meeting of the Directors held at One Mitre Square, London EC3A SAN on Wednesday 29 th January 1992 at 1 1 . 3 0 asa Present: In attendance: iy 3..D. Fenhalls - Chairman G.3.0. Cooper S.:. Jennings J.A. KolliweLl O.S.G. Adam ?. Ballard J.K. Button J-D Calmes ?.A. Cragg D.A.P. CrawLev J.J. Helbronner 3.N. Jolles D.C. Matthews F.T. Riess D.J. Sebire P.R. Thom . M. Tilmant P.J. Wastall Apologies for absence were received from Messrs. A. Al-Salem and p. BeLlens. 'szxc I - MATTERS . - . .q - n; QG l? 474 I . Loan 5 Investment Review Comittee 4.3 475' ,.4.2 Msetinc held c " January 1992 M 5*. Sebirs reported to the Board as foLlows, i respect of matters considered and r e v i s e d at th quarterly meeting of the Committee held earlia today; . The Committee had discussed a revia> (aarticularly in regard to the Loan beak) c. operations and procedures in the Caysa; Is Lancs. The Board noted that this natter would b< further investigated and addressed H-• Jennings, in consultation with Mr. FennallJ and H r • B u t t o n . till Hinu t e s ’of a aeeting of the Directors •• he l d at One Mitre Square, London EC3A SAM on 'Wednesday 29th July 1992 Pr e s e n t : 5.0. Fenhalls - Chairnan E.H. Al-Humaidhi D . Sellens ',.; J.M. Button' R.'rf.E. Charlton (as Alternate for J.D. Calaes) G.5.0. Cooper W.L.S. Guinness • S.?. Jennings D.J. Sebire Invited: J.A. Holliwell In attendance: ?.3. Then - Secretary S.A. Cole - KPMG Peat Marwick (items 1 to 10) G. Russell - KPHG Peat Marwick (iteas 3 to 5) P.J. Wastall Apologies for absence were received from Messrs. A. Al-Salem, J.D. Calroes, M. Delloye, J. Krier, A. Langlois-Meurinne and M. Tilmant: MINUTES 1.1 Minutes of the meeting of the Directors held on 29th April 1992 were approved for signature b y the Chairman. 1-2 Minutes of meetings of the Executive Committee of the Board held on 27th Hay, 5th June and 24th June 1992 were noted and endorsed. • b) Dublin Accounts The Committee had expressed concern that -.these accounts continued to^ be controlled •exclusively (with the Cayman books being only a reflection of the Dublin position) by Mr. Des Traynor and operated under his sole signing authority. It was noted that the position relating to the Dublin accounts would be reviewed by the Board in due.course. AppendixDK-(g) ANSBACHER INTERNATIONAL TRUST GROUP LTD INTERNAL MEMORANDUM To: R.D. Fenhalls/J.M. Button 4 . From: i-l S.F. Jennings / K.M. McAuliffe ✓ Date: 16th September 1992 Subject: Dublin Accounts BACKGROUND • Whilst reviewing the circumstances surrounding ihc continual excesses at Irish Intercontinental Bank (IIB) and Kredtetbank (KB) a discussion was held between SFJ, KMA, John Furze (JAF), and Bryan Bothwell (JBB). JAF was asked by KMA why it was not possible to ensure that transactions recorded in the records held in Dublin could not be entered in the books o f AL on a more timely basis. JAF responded that there were approx 250 transactions per month and that the majority were passed through a Cayman company called Hamilton Ross Limited (HRL). JAF described HRL's activity as being to receive "deposits" in Eire from a number o f clients and for these to be banked in HB on behalf o f AL. JAF advised that he was unsure what if any documentation existed in Eire to substantiate the relationships between HRL and the depositors. HRL ' This is a Cayman company formed in 1981, whose directors are JAF, one current employee and one ex-employee o f AL. JAF is Ihe registered holder o f 98 shares the other 2 being held by employees. N o nominee agreement* or Declarations o f trust are on file. N o financial statements exist for HRL but the books o f HRL show that it has 29 separate sub designated deposits with AL arid that these were funded from a similar number o f '’Suspense'* accounts, the majority o f which carry no' sub-designation. The company docs not have any reserves, and would appear, with the exception o f one deposit o f £2m which JAF advised to be for the company’s account as principal (being funded by a loan), to be used exclusively for the purpose o f the collcction and onward .transmission o f deposits to AL. AL's ROLE . AL's books show 29 deposit accounts from HRL all o f which carry a numeric sub­ designation. Once a quarter, statements o f these accounts are printed in Eire and JAF advised that these are given to the underlying clients. HRL does not have a bank mandate for the operation o f its accounts with AL. l&AO) . IaiiU j (\ fajh IrnJJj IrJKnddh '• u QLb tfff thi w jb O y jk i'tK j fa

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I*®** CUa A r«h**cV . - [) Ky WOfk 1Mtmbtr tftk t Hmry Ambacher HaUbtgi PLCMerchant Banking Croup P .O . B o x S t7 . O r m d C a y m a n . B ritb k W a t H i g Please reply to: 42 Fazwflliam Square, Dublin 2. Phan* T«kjc CP 4305 Rue Tel: 765144/763065 Fax; 612035 G a r r e t t Lo ga n , E s q ., I r i s h In te r c o n t in e n t a l 91 M e r r i o n S q u a r e , D U B L IN 2 . Dear (IN) M90M6 (W9) 9*9-3267 Bank L im ite d , " G a rre tt, C o u ld y o u p le a s e S t g .£ 1 ,057.50 to Y o u rs <*0») 94M«33m a r r a n g e t o lo d g e t h e e n c lo s e d c h e q u e f o r A n s b a c h e r L im it e d C a l l A c c o u n t N o . 02/0 1 0 87 /8 1 s in c e r e ly , . L 'J U U For ANSBACHER L IM IT E D I ITib T *• •• r - - • ’.s .- ..'/* * •* • .. , •>*.••• •* • ■ & • : ............. ( • >. . r...■•.‘v * t f . ■!"•. • ’ ••• \ •* t • >> i •. **• * r .v <.1A J.1 • " -•-.»■■ , -* ) 900 X . F . D . I I 10595 3884 .5 » 5 S i. ( “ ) 10 -12 -0 1 wurore^--.-?.l.'«?.-?®P... o~“ * " ! . WC..T If thb documam ■pmanud through A BANK* I witfmax mentis. ihoCmhrn oOnhndftawmii*vwilpay; * PAYEE - vS' » Rockford Iavestsents Halted 7-11 Britannia Place Bath Street ' St Keller Jersey C h a n n e l Is la n d s • * 0 0 0 0 0 l»* . £ l.0 5 7 .5 0 1 J. M. CRAWLEY P r in c i p a l Pmtnea O H .e a r of I n l a n d fta v a n o * Tha MVH’i lignmura I* raqund om iM ITttw documam to AMpntM M through t» w m 'i mik btrfc account i O - l B O l i : 0 5=15 3aaun* ^ c a t- r /« « -* ' appopix xtii L o w i« t- o f f a g a in st P coeaft Account* Loan IB£ Loans Rockford InvMtKfits/Yorfc Securitlos £ 172,965 Deposit * £ 194.243 Wat Balanct £ (21.278) YORK SECURITIES LIMITED - ASSESSMENT. No.1. Loan : £101,796. No.2. Loan : £211,153. No..3. Loan : £112,222. / S ecu rity : No.1 . Loan. J o i n t and several guarantee of Brian , and Anthony Rhatigan. ( No.2 .Loan. Jo in t and several guarantee o f William ( and Joyce Forwood supported by , No.3.Loan2t»ui t ?b1f of T i t l e Deeds of ( Woodstock. We consider the Security to be adequate in a l l cases. THIS LOAN IS CASH BACKED « rovto for Drawdown; ................. ........... ....................................— • J & M . & Co. (W w ar £1m total axposura) A ppendix X V (150) M r R onald T Fredette 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Ronald T Fredette. a) Letter o f 25 November 1991 - Ansbacher Limited to Guinness and Mahon. b) Guinness and Mahon statement o f 20 November 1985 - GMCT/College. c) Guinness and Mahon statement o f 22 January 1986 - GMCT/College. d) Guinness and Mahon statement o f 17 February 1986 - GMCT/College. e) Guinness and Mahon statement o f 20 February 1986 - GMCT/College. f) Guinness and Mahon statement o f 19 March 1986 - GMCT/College. g) Guinness and Mahon statement o f 24 March 1986 - GMCT/College. Please reply to: 42 Fitzwiniam Square,'' Dublin 2. Tel: 765144/763065 Fax: 612035 P.O. Box 187, Gtaad Caynan, 0 yma Idtnd^Brittah Wert Indiea Telephone: (809) 949-8635 Tela* CP4305 FaotaOe (809) 949-7946 (809) 949-5267 25th November, 1991. M. D av id H u m p h r i e s , Esq., Senior Manager - Operations/ G uinness 6 M a h o n Limited, 17 College G r e e n , DUBLIN 2. Dear David, I confirm Fadraig C o l l e r y 1s letter of the 20th November requesting US$5,000 cash and US$5,000 in Travellers Cheques payable to Mr. R o n Fredette. rhe above amounts are to be debited to Ansbacher Limited ce Poinciana Fund Account N o . 08428030. E should be grateful if you could advise the total cost of rhe above. C enclose herewith the signed receipts for the Travellers Cheques. 'o sincerely. r.D. Traynor. 15 H W *® DT/AJW A M P O P O T T C T H 1 l f l^ B I H r H I » n i llM I,T « U W O » O II » 0 » C 0 M W I H M W> IH no. * 1 IWWW f it rr J*V •, S: :; S v i yr ,;Clw .. t. t -P. ct. c 0 U 1 N M S S N M N N C AVN AN T R U S T / C O L L K I C / O G u t I M S I W U M H C A T * A * TR U S T M W MT GRAMO C A T * A * M t t T t S H M «S T W O I I J ' I rn.B-.-i 11I0M *SW MSillV * MtulM 0*t«9 rniN tf itnu m«»> Mm tiHMim o/j M c n o a / x in ti wniAvs new** o ssm w x b •>i v > j > t ' iMMU»i* itfl •‘it j *»• v/o ti»3 utMiun • 1 (39031 n r m o e *J*fl •0« I9»< *Sn jh to a m l / MiNIW « a* i s m l i m n s m n stMMMtt mnQini i >niaii O il N0HW I+SS3NNinD ■s - lAI+0 A ppendix X V (151) M r Colm H yland 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Colm Hyland. a) Transcript o f evidence o f Mr Colm Hyland dated 11 July 2001. b) Statement o f Mr Colm Hyland dated 14 May 2001. c) Guinness and Mahon statement o f a/c re GMCT/College o f 20 February 1984. d) Guinness and Mahon statement o f a/c re GMCT/College o f 18 October 1985. e) Guinness and Mahon credit committee minute o f 21 September 1977. f) Extract o f transcript o f evidence o f Mr Geoffrey Miller dated 20 February 2000 . UNDER OATH ON WEDNESDAY, 11TH JULY 2001 I hereby c e r t i f y the fo ll owin g to be a t r u e and a c c u r a t e t r a n s c r i p t of my sho rth an d note s i n the above named i n t e r v i e w . Stenographer The I n s p e c t o r s : JUDGE O'LEARY MS. MACKEY BL S o l i c i t o r t o th e I n s p e c t o r s MS. M. CUMMINS Interviewee: MR. C. HYLAND 1 2 3 4 5 JUDGE O'LEARY: Thank you very much indeed, Mr. Hyland, f o r 6 7 coming. 8 We should not be long, i t w i l l be q u i t e s h o r t . 9 p o s i t i o n i s t h a t we have been i n v e s t i g a t i n g the We have a number of q u e s t i o n s t o ask you. The 10 a f f a i r s of a company c a l l e d Ansbacher, which has 11 been c a l l e d o t h e r th i n g s as wel l, l i k e ; Guinness 12 Mahon Cayman T r u s t, GMCT and v a r io u s names of t h a t 13 kind down through the y e a r s . 14 15 One of the jobs we have been asked t o do by th e High 16 Court i s to i d e n t i f y pe rsons who were, a t the 17 a p p r o p r i a t e time, which i s b a s i c a l l y d uri ng the 18 1970's, 1980's and 1990's, who were c l i e n t s of t h i s 19 firm, Ansbacher, under t h a t name or under one of i t s 20 p re v io u s names. 21 22 We are not i n v e s t i g a t i n g th o s e peo ple , I want to 23 make t h a t c l e a r but we must f i n d out who were the 24 c l i e n t s of Ansbacher. 25 do i s we have to t r y and e s t a b l i s h t h a t f o r t h a t 26 purpose and a l s o to get a b e t t e r u n d e rs ta n d in g of 27 the company's o p e r a t i o n s , we have i n v i t e d a number 28 of people from time to time to come i n and chat to 29 us . The next t h i n g we have got to 1 I t i s a very inf or mal p ro c e dure . 2 p o r t i o n i s t h a t which i s l a i d down by th e Act under 3 which we o p e r a t e and t h a t i s t h a t th e evidence w i l l 4 be given on oath and t h a t a t th e end of the 5 i n t e r v i e w th e evidence w i l l be reduced t o w r i t i n g 6 and you w i l l be r e q u i r e d to si g n i t as an 7 acknowledgment t h a t i t i s a c o r r e c t r e c o r d of what 8 went on here today. 9 later. The only formal I w i l l t a l k t o you about t h a t 10 11 My name i s Sean O'Leary, I am one of th e i n s p e c t o r s . 12 In f a c t I am not th e i n s p e c t o r who w i l l be asking 13 you most of th e q u e s t i o n s today, t h a t perso n i s Ms. 14 Noreeen Mackey, who i s a l s o an i n s p e c t o r . 15 fo ur i n s p e c t o r s but the two i n s p e c t o r s who have been 16 a l l o c a t e d to i n t e r v i e w you a re Ms. Mackey and 17 myself. There ar e 18 19 I have nothi ng e l s e to say except t h a t th e only 20 r e a l l y formal p a r t of th e procedure i s th e t a k i n g of 21 the oa th. 22 23 24 25 26 27 28 29 So, we w i l l ask you to ta k e th e oath now. 1 FOLLOWS 2 3 4 5 1 Q. MS. MACKEY: Mr. Hyland, j u s t f o r the re c o r d i f I could ge t a 6 7 l i t t l e b i t about your background and your c a r e e r . I 8 t h i n k you t o l d us in your st a t e m e n t t h a t you worked 9 with G.B. M i l l e r , what a re you by p r o f e s s i o n or career? 10 11 A. I did a B. Com. in U.C.D. between 1961 and 1964. 12 S h o r t l y a f t e r w a r d s I emigrated to Canada and spent 13 two and h a l f year s t h e r e and then came back to the 14 U.K. 15 a p e r i o d of time, f o r a year and a h a l f and then 16 through t h a t came in c o n t a c t with a gentleman c a l l e d 17 J e f f M i l l e r , whom you have i n t e r v i e w e d a l r e a d y . 18 2 Q. 19 A. I worked in the U. K. f o r a m u l t i n a t i o n a l f o r Yes? He asked me to j o i n , so, I b a s i c a l l y j o i n e d . . . (INTERJECTION). 20 21 3 Q. 22 A. In what c a p a c i t y did you j o i n the company? I j o i n e d on th e u n d e rs ta n d in g t h a t I would a t a 23 l a t e r s ta g e be ab le t o pu rchase a s h a r e h o ld in g . 24 suppose i n i t i a l l y i t was on a t r i a l p e r i o d , I was 25 coming home, I wanted to come home, I mean, the 26 60' s , th e whole ide a was to go abroad and get some 27 e xper ie nc e and then come back. 28 29 4 Q. Did you j o i n th e board immediately? I 1 5 Q 2 A I suppose I was r e a l l y brought back, we had a c q u ir e d 3 a new agency, I was working f o r th e company in 4 England, which c o n s t i t u t e d th e main agency of G.B. 5 M i l l e r , which was a company c a l l e d W.R. Grace. 6 6 Q 7 A Yes? I t was an American company and th e y were inv olv ed in 8 th e p r o d u c ti o n of vacuum packaging m a t e r i a l s , which 9 were used in th e meat i n d u s t r y and th e cheese 10 i n d u s t r y and a l l of t h a t type of t h i n g . 11 have j o i n e d i n i t i a l l y to - - wel l, we had a c q u ir e d a 12 new agency and I suppose he wanted somebody to look 13 after that. 14 7 Q 15 A I would You were coming back to manage t h a t e f f e c t i v e l y ? Coming back to manage t h a t , but I mean, managing in 16 th e sense t h a t i t was a small company so i t was very 17 much a hands on o p e r a t i o n . 18 8 Q 19 A 20 9 Q I went out s e l l i n g and a d m i n i s t e r i n g . In due course then di d you in f a c t purchase s ha r es in th e company? 21 22 Yes ? A 23 I th e n became a d i r e c t o r but not a s h a r e h o l d e r and th e n s u b s e q u e n t l y . . . (INTERJECTION). 24 10 Q 25 A 26 11 Q 27 A What d a te s appro xim at el y did t h e s e t h i n g s happen? I j o i n e d M i l l e r s in 1969. Yes? I would have become a d i r e c t o r I t h i n k pro bably 28 about 1970, then su bse q u e n tl y I t h i n k about '72, 29 maybe, I pur chased a 10 p e r c e n t share hol di ng . '73 1 12 Q. 2 A. 3 13 Q. 4 A. 5 About 1972? T h a t ' s my guess. Did you i n c r e a s e t h a t s h a r e h o ld in g a t any s tag e? I su bs e q u e n tl y r e c e i v e d an a d d i t i o n a l 5 p e r c e n t in 1979, 1980, somewhere around 1979 or 1980. 6 14 Q. 7 A. Y ou rs el f and Mr. M i l l e r were th e two s h a r e h o l d e r s ? There was a n o th er d i r e c t o r c a l l e d Ray McCutcheon but 8 I d o n ' t t h i n k he was a s har e h o ld e r and he l e f t 9 shortly a fte r that. 10 15 Q. c o n s t i t u t e d th e e n t i r e . . . (INTERJECTION)? 11 12 To th e b e s t of your knowledge the two of you A. Yes, and a t a l a t e r s ta g e a n o th er gentleman 13 purchased a 10 p e r c e n t s har e h o ld in g . 14 t h e r e was a disagreement and he l e f t th e company. 15 That i s r e a l l y how I go got to a c q u ir e my a d d i t i o n a l 16 5 p e r c e n t i f you l i k e . 17 16 Q. Yes, I un de rs tand , in 1979? 18 17 Q. JUDGE O'LEARY: Who was t h a t , do we know 19 20 h i s name, t h a t chaps name? A. 21 22 Shortly a f t e r 18 Q. Dermot O'Regan. JUDGE O'LEARY: Thank you. MS. MACKEY: You s e n t us i n a sta te m e nt 23 Mr. Hyland, do you have a 24 copy of i t t h e r e with you? 25 A. 26 19 Q. E x h i b it 1. I do, yes. I would l i k e to j u s t go through i t , I t h i n k t h a t the 27 i s the s i m p l e s t t h i n g , to go through t h a t because 28 you have given us q u i t e a l o t of i n f o r m a t i o n and 29 thank you f o r t h a t . To c l a r i f y a c e r t a i n number of 1 m a t t e r s in t h a t , you s t a r t o f f by t e l l i n g us t h a t 2 you do not have an Ansbacher account and t h a t you 3 only became aware of the name through th e media 4 coverage. 5 begin nin g, Ansbacher was not always c a l l e d 6 Ansbacher? 7 A. 8 20 Q. 9 As Judge O'Leary s a i d t o you a t the Yes. I t had a number of d i f f e r e n t names. I t may be t h a t you are more f a m i l i a r with i t under one of i t s o l d e r 10 names. 11 Tr u st , i t was a s u b s i d i a r y of Guinness and Mahon and 12 was c a l l e d a f t e r i t . 13 I n t e r n a t i o n a l Bank and Tr u st Company? 14 A. 15 21 Q. 16 I t s f i r s t name was Guinness Mahon Cayman I t was a l s o c a l l e d Cayman Yes. I t was c a l l e d then Ansbacher Limited and Ansbacher Cayman Limited. 17 A. 18 22 Q. Yes. You e x p la i n e d to us here on page fo ur of your 19 s ta t e m e n t, E x h i b it 1, about a p ro p o s a l put to 20 y o u r s e l f and Mr. M i l l e r or to the company, by S.K.C. 21 about th e s e t t i n g up of a t r u s t ? 22 A. 23 23 Q. Yes. Could you f i l l in the background of t h a t a l i t t l e 24 b i t f o r me? 25 f i r s t a ros e and who the perso n in S.K.C. t h a t d e a l t 26 with i t was? 27 A. Could you t e l l me how t h i s pro pos a l I t h i n k , as I have s a i d in my s t a t e m e n t , E x h i b it 1, 28 I would have been aware of i t but most of the 29 d e a l i n g s would have been done by Mr. M i l l e r . 1 24 Q. 2 A. 3 25 Q. 4 5 Yes? He was more o f f i c e based. I u n de rs ta nd but were you p r e s e n t a t th e meetings t h a t de cided t h i s th in g? A. I have no r e c o l l e c t i o n , I knew the background to i t , 6 put i t t h a t way, but i f you ask me t o swear on oath 7 was I p r e s e n t a t meetings, I c o u l d n ' t t e l l you. 8 26 Q. 9 Who t o l d you f i r s t about th e t r u s t , was i t Mr. M i l l e r him se lf? 10 A. Mr. M i l l e r , yes. 11 27 Q. 12 A. 13 28 Q. Had i t a l r e a d y been e s t a b l i s h e d a t t h a t s tag e? 14 A. No, I t h i n k i t would have been in th e p r o c e s s . That i s th e f i r s t you he ard about i t ? Yes. I 15 t h i n k th e l i k e l y s c e n a r i o and you must remember t h a t 16 we are t a l k i n g about 25 ye ars ago. 17 29 Q. 18 A. Yes? The l i k e l y s c e n a r i o would have been t h a t he would 19 have had a meeting or a s u g g e s ti o n would have been 20 put t o him, say maybe i t was th e review of the 21 annual accounts or something l i k e t h a t , and a 22 s u g g e s ti o n would have been made t h a t i t was p o s s i b l e 23 t o s e t t h i s up. 24 30 Q. 25 A. 26 31 Q. 27 Yes? I would have been aware of i t , I mean. What was put i n t o t h i s e f f e c t i v e l y was commission t h a t was being earned o ve rs eas? 28 A. 29 32 Q. Yes. You a t t h i s s ta g e were a l r e a d y a s h a r e h o l d e r ; i s 1 2 A. 3 4 I would have been a 10 p e r c e n t s h a r e h o l d e r , I t h i n k I would have been a t t h a t s t a g e , yes. 33 Q. In th e o r d i n a r y course of ev en ts you would have been 5 e n t i t l e d to 10 p e r c e n t of t h i s commission; would 6 t h a t be th e case? 7 A. 8 34 Q. 9 C o r r e c t, yes. In t h a t sense p a r t of th e money t h a t was r i g h t f u l l y due t o you was going i n t o t h i s t r u s t ; i s t h a t correct? 10 11 A. 12 35 Q. 13 Yes. Ten p e r c e n t of whatever went in you were e n t i t l e d to? 14 A. 15 36 Q. 16 Yes. Coming down a l i t t l e f u r t h e r towards th e bottom of page 4, you say, 17 "In a d d i t i o n and a t th e T r u s t ' s d i s c r e t i o n both Mr. M i l l e r & myself were permmitted to draw monies in p r o p o r t i o n to our s h a r e h o l d i n g . " 18 19 20 21 Who de cided t h i s , how di d t h i s come about or how did 22 you know you were committed? 23 A. Again, I presume s in ce I was a 10 p e r c e n t 24 s h a r e h o l d e r in th e company and a l s o because the 25 t r u s t was s e t up and monies were going, i f I l i k e , 26 i t would have been - - i t i s r a t h e r d i f f i c u l t y to 27 e x p l a i n because I suppose any th in g t h a t would have 28 happened, i f I was a 10 p e r c e n t s h a r e h o l d e r in the 29 company, I would have been e n t i t l e d t o i t , yes. 1 37 Q 2 A 3 38 Q Yes . Are you f a m i l i a r with th e o p e r a t i o n of t r u s t s ? The 4 money i s a c t u a l l y put o u t s i d e the c o n t r o l of the 5 owner of th e money and i t i s a t th e t o t a l d i s c r e t i o n 6 of th e t r u s t e e s to decide what to do with i t ? 7 A Yes. 8 39 Q Yes? 9 A Well, was t h a t th e case then? A ll I can t e l l you i s t h a t somebody came t o us with 10 a scheme, which, as f a r as we were concerned, was a 11 l e g a l scheme. 12 40 Q 13 In f a c t i t was someone in S.K.C. who t o l d you you could withdraw th e money? 14 A 15 41 Q 16 A 17 42 Q We would not have known about t h i s q u i t e f r a n k l y . Yes? I t was a s u g g e s ti o n t h a t was put t o us. I t was your unde rs ta n d in g t h a t whenever you wished 18 t o withdraw money you could do so. 19 no i l l u s i o n s about t h a t , you were q u i t e s a t i s f i e d 20 t h a t i f you wished to have money a l l you had to do 21 was ask? 22 A You were under I would t h i n k t h a t - - i f I t h i n k back, and again I 23 p r e f a c e a l l t h i s by saying you are a ski ng me to 24 remember d e t a i l s of 25 ye ars ago, I c o u l d n ' t even 25 t e l l you what p r o f i t s th e company was making 25 26 years ago. 27 like th at. 28 43 Q 29 A Yes? You a re asking me to remember d e t a i l s 1 t h a t i n i t i a l l y , and as I say, the main re a so n s , we 2 had had a couple of bank s t r i k e s , we were a company 3 t h a t was growing, here was a p o s s i b i l i t y , of having 4 monies which could be used as backing, so t h a t we 5 could use back to back f a c i l i t i e s t o develop the 6 b u s i n e s s . . . (INTERJECTION). 7 44 Q Yes, but I am t a l k i n g about th e withdrawing of the money? 8 9 A 10 45 Q 11 A I am coming to t h a t . Yes ? Here i s th e s i t u a t i o n , we have t h i s i n i t i a l l y , 12 would t h i n k t h a t over th e p e r i o d t h a t the 13 arrangement e x i s t e d i t became a l i t t l e l o o s e r . 14 46 Q 15 A I Yes? Put i t t h a t way. That i n i t i a l l y we pro ba bly 16 w o u ld n 't have drawn monies or i t might have been, i f 17 you l i k e , a more r i g i d system in o p e r a t i o n but I 18 t h i n k i t i s t r u e to say t h a t as time p r o g r e s s e d and 19 i f I go back towards th e be gin nin g of th e 80 ' s . 20 47 Q When you did want money, Mr. Hyland, you c o n t a c t e d Mr. Colle ry? 21 22 A 23 48 Q 24 Yes . Was i t always Mr. C o ll e ry or were you i n c o n t a c t with Mr. Traynor a t any s ta ge ? 25 A 26 49 Q 27 A 28 50 Q 29 Yes. No. I s a i d I have never met Mr. Traynor i n my l i f e . I t was always Mr. Colle ry? Yes . Were you in t r o d u c e d t o Mr. C o l l e r y and t o l d t h i s i s th e man t h a t w i l l . . . ( INTERJECTION)? 1 You see, we had had commercial d e a l i n g s with 2 Guinness and Mahon, we would have used them f o r 3 loans and I t h i n k f o r e i g n c u r r e n c i e s , I t h i n k I am 4 c o r r e c t in saying f o r e i g n c u r r e n c i e s , f o r e i g n 5 cu rre nc y t r a n s a c t i o n s . 6 51 Q 7 A 8 52 Q 9 A Yes? L e t ' s say we were imp or tin g. Yes, I und erstand? I f we were impo rt ing from Germany and t h i n g s l i k e 10 that. 11 there is a 12 t h a t we d e a l t with but t r y i n g to , over th e p e r i o d of 13 time, t r y i n g to d i f f e r e n t i a t e between who we d e a l t 14 with on e i t h e r s i d e i s a l i t t l e d i f f i c u l t . 15 f o r i n s t a n c e t h a t we had d e a l i n g s with a chap c a l l e d 16 Leonard in t h e r e who was a banking manager. 17 53 Q 18 A 19 20 Where I have a l i t t l e d i f f i c u l t y i s t h a t number of people in Guinness and Mahon I know Yes ? He would come in and review and we would come in and p r e s e n t our accounts to him. 54 Q R e a ll y a l l I am concerned with are who you d e a l t 21 with i n r e l a t i o n to t h i s p a r t i c u l a r a s p e c t , not who 22 you d e a l t with in r e l a t i o n to your normal b u s in e s s ? 23 A What I am saying to you i s th e d i f f i c u l t y I have i s 24 over a p e r i o d of 25 years a c t u a l l y d i s t i n g u i s h i n g 25 who i s who. 26 55 Q 27 A 28 56 Q 29 A ll r i g h t . Okay. Moving on the n, were you aware a t th e time when S.K.C. s e t t h i s up where th e t r u s t was being 1 2 As f a r as I was concerned and t h i s i s where my 3 d iffic u lty is, 4 th e names you have mentioned. 5 57 Q 6 A 7 58 Q 8 A 9 Leaving t h a t a s i d e , where d id you t h i n k i t was? The I s l e of Man or the Channel I s l a n d s . Yes? The Cayman I s l a n d s , I have no r e c o l l e c t i o n o f . . . (INTERJECTION) 10 59 Q 11 A Your b e l i e f i t was the Channel Is l a n d s ? Oh, yes. As f a r as I am concerned i t was e i t h e r the I s l e of Man or th e Channel I s l a n d s . 12 13 I c e r t a i n l y h a v e n ' t he ard of any of 60 Q I t h i n k you a re c o r r e c t because I am going to show 14 you a document now, I t h i n k you are c o r r e c t in your 15 b e l i e f t h a t i t was one or th e o t h e r and i n f a c t i t 16 appears to have been th e Channel I s l a n d s . 17 going t o show you a document but I want t o e x p la i n 18 something to you f i r s t about i t ? 19 JUDGE O'LEARY: 21 q u e s t i o n a r i s i n g out of t h a t i f you would not mind. 22 A 23 61 Q 24 Yes, of cou rse. You thought i t was going to be I s l e of Man or the Channel I s l a n d s ? 25 A 26 62 Q 27 29 Before I show you the document could I ask one 20 28 I am Yes . When i t was a c t u a l l y s e t up di d you know whether i t was th e I s l e of Man or th e Channel I s l a n d s ? A I c o u l d n ' t h o n e s t l y t e l l you which one i t was because th e two, i f you l i k e , were synonymous. 1 63 Q 2 A 3 You had money t h e r e f o r a p e r i o d of how many year s? Well, I t h i n k I have s a i d in my s ta t e m e n t, E x h i b it 1, t h a t I t h i n k t h i s was s e t up i n 1974. 4 64 Q 5 A 6 65 Q Yes, and you f i n a l l y withdrew your l a s t money in? In 1984. For t e n ye ars you had money and you d id not know 7 whether i t was on the i s l a n d in th e I s l e of Man or 8 one of Channel Is l a n d s ? 9 A As f a r as I was concerned i t was being a d m in is te r e d 10 by G. & M. 11 we were in t r o d u c e d to somebody from th e Channel 12 I s l a n d s on one occas ion when he came over here. 13 66 Q I met somebody from th e Channel I s l a n d s , MS. MACKEY: 14 15 was ? A 16 17 Do you r e c o l l e c t who t h a t Yes, I am su re you have h i s name a l r e a d y , a chap c a l l e d John Lipscombe. 67 Q JUDGE O'LEARY: 18 Can I ta k e i t t h a t from th e a v a i l a b l e i n fo r m a t io n 19 and the f a c t t h a t you were in t r o d u c e d t o t h i s man 20 from the Channel I s l a n d s t h a t you thoug ht i t was the 21 Channel I s l a n d s ? 22 A 23 68 Q I t h i n k i t would be f a i r to assume t h a t , yes. MS. MACKEY: Before I show you 24 t h i s document the n, Mr. 25 Hyland, I should e x p la i n to you t h a t what we have 26 l e a r n e d in th e course of th e i n v e s t i g a t i o n we have 27 been doing f o r th e l a s t year and a h a l f i s t h a t one 28 of the s u b s i d i a r i e s of Guinness and Mahon w i t h i n the 29 Channel I s l a n d s , and i t was a company c a l l e d College 1 T r u s t e e s , and indeed Mr. Lipscombe worked f o r 2 College T r u st e e s? 3 A. 4 69 Q. 5 Right. I t managed funds of I r i s h r e s i d e n t s who had funds with Guinness and Mahon in th e channel I s l a n d s ? 6 A. 7 70 Q. Yes. From sometime towards th e end of th e 1970' s or mid 8 1970' s onwards i t p la c e d th o s e c l i e n t ' s monies on 9 d e p o s i t with Ansbacher and in the m a j o r i t y of cases 10 th e c l i e n t s di d not know t h a t because t h e y were 11 d e a l i n g a t a l l times with College T r u st e e s through 12 Guinness and Mahon but in f a c t the funds were pl a c e d 13 with Ansbacher. 14 i n Guinness and Mahon, which i s where you were a ble 15 t o draw them out, in an account c a l l e d Guinness 16 Mahon Cayman T r u s t, which was the name of Asnbacher 17 a t th e time, s t r o k e , College T r u s t e e s . They were p la c e d by Ansbacher back 18 19 I am going to show you a document now, page 58 Ms. 20 Cummins, p l e a s e , s o r r y 59 a c t u a l l y , you can give 21 both of them but i t i s 59 I want t o look a t f i r s t . 22 A c t u a l l y no, we w i l l look a t 58 f i r s t , we w i l l ta ke 23 them i n o r d e r . 24 t h e r e , Guinness Mahon Cayman/College, E x h i b it 2? 25 A. 26 71 Q. 27 A. 28 72 Q. 29 You see a t th e top of th e page Stroke College, yes. Account name? Yes. We have b l o t t e d out a number of th e t r a n s a c t i o n s in 1 under the column p a r t i c u l a r s , with th e d a te 16th 2 February 1988, "Deutschemark Charges" do you see 3 that ? 4 JUDGE O'LEARY: 1984 i s i t not? 5 MS. MACKEY: 1984, s o r r y . 6 "Deutschemark Charges, 1032 a t 385, H y la n d. " 7 8 9 10 Can you see t h a t Mr. Hyland? A. Yes, s o r r y , yes. I see DM charges, 1032 a t 305, yes . 11 12 73 Q. 13 A. 14 74 Q. "Hyland"? Yes. Would i t be l i k e l y t h a t you were g e t t i n g 15 Deutschemarks a t t h a t s t a g e , buying Deutschemarks. 16 Did you buy Deutschemarks o c c a s i o n a l l y ? 17 A. 18 19 Why would I have bought - - 16th February - - i t i s p o s s i b l e , yes, q u i t e p o s s i b l e . 75 Q. I f we move on down f u r t h e r then you see a d a te 20th 20 February '84, and we have " S t e r l i n g , Re Hyland" and 21 we have £50? 22 A. 23 76 Q. 24 A. 25 77 Q. 26 A. 27 78 Q. Yes. Does t h a t seem l i k e l y ? Had we s e p a r a t e d from s t e r l i n g a t t h a t s t a g e . We must have i f i t was being purchased, yes? You are s u g g e s ti n g t h e s e a re char ges , are th e y. That appears to be an a c t u a l S t e r l i n g t r a n s a c t i o n , 28 the one above i s a charge f o r Deutschemarks, t h i s 29 appears to a c t u a l l y be S t e r l i n g t h a t was bought? 1 2 79 Q. 3 A. 4 80 Q. 5 A. 6 81 Q. 7 A. 8 82 Q. 9 A. 10 83 Q. 11 A. 12 84 Q. 13 A. 14 85 Q. Yes, i t appears to be? Yes. I f we look a t page 59, E x h i b it 3? Yes, which i s th e second. Have you got a r e l a t i v e c a l l e d Jean? My wife i s Jan Hyland. J-E-A-N? No, i t ' s J-A-N. J-A-N? Yes. Do you have a dau ghter c a l l e d Jean? No. JUDGE O'LEARY: 15 which from time t o time i s 16 17 abused by people who do not know i t ? A. 18 Yes. JUDGE O'LEARY: A. 21 22 You can see t h e r e on 15th O c t o b e r . . . (INTERJECTION). 19 20 I presume J-A-N i s a name Maybe i f you could e x p la i n to me th e re aso n f o r your q u e s t i o n and then maybe I can help you? 8 6 Q. MS. MACKEY: 23 I am not even asking you a q u e s t i o n a t t h i s s ta g e I 24 am p o i n t i n g out to you t h a t your name appears on 25 t h e s e accounts? 26 A. 27 87 Q. 28 A. 29 88 Q. Yes. In th e name of Guinness Mahon Cayman T r u s t / C o l l e g e ? Right, yes. What you have i n d i c a t e d to us a l r e a d y i n d i c a t e s t h a t 1 your money was c e r t a i n l y in th e Channel I s l a n d s ? 2 A. 3 89 Q. 4 C o r r e c t. Because you were of the b e l i e f t h a t i t was t h e r e or th e I s l e of Man? 5 A. 6 90 Q. 7 A. 8 91 Q. 9 A. 10 92 Q. In f a c t he was a College T r u st e e s man. 11 93 Q. JUDGE 0 ' LEARY: Yes . The man you met was a Channel I s l a n d s man? Yes . Whom we know? Yes . College T r u st e e s a t t h a t 12 13 time ? 14 A. 15 94 Q. 16 A. 17 95 Q. 18 19 Did you ever hear At th e time I c o u l d n ' t say, I h o n e s t l y c o u l d n ' t say. Did you hear of i t su bse quently? Oh, I did, yes, obvio usl y r e a d in g th e pa per s. Did you h e ar of i t in th e c o n te x t of your money subse quen tly? A. No, no. Well, i f I did I c e r t a i n t y have no r e c o l l e c t i o n of i t . 20 21 96 Q. 22 A. I see? I t h i n k , your Honour, what I ' l l have t o say i s t h a t 23 I d i d n ' t ta k e a huge i n t e r e s t , 24 monies t h e r e , th e mechanics of i t w ou ld n 't be 25 something t h a t I would ta k e a g r e a t i n t e r e s t in . 26 97 Q. 27 A. MS. MACKEY: I knew t h e r e were Yes, I unde rstand? In terms of e x p l a i n i n g , assuming t h a t i t i s my wife, 28 i t could e a s i l y have been t h a t I s a i d "You're in 29 town, would you ever p ic k up something?" And i t 1 2 98 Q. 3 A. 4 99 Q. 5 100 Q. 6 A. 7 101 Q. Yes? She w ou ld n' t have been aware of t h i s ? JUDGE O'LEARY: I un d e rs ta n d t h a t MS. MACKEY: I t was r e a l l y th e name? My wife i s Jan, s h o r t f o r J a n i c e . Yes. Taking a l l in a l l i t would appear t h a t your 8 money, which had been in College T r u st e e s or been in 9 th e Channel I s l a n d s , was moved by College T r ust e e s 10 a t th e time t h a t i t moved a l l i t s o t h e r c l i e n t ' s 11 monies to Ansbacher? 12 A. 13 102 Q. Yes. This i s how your name appears in an account with the 14 name of Ansbacher over i t and t h i s i s th e reason 15 t h a t we have asked you to come in and see us. 16 A. 17 103 Q. 18 Would you acce pt t h a t in f a c t t h a t appears to be the case, t h a t your money appears to have been moved? 19 A. 20 104 Q. 21 A. Moved t o t h i s . . . ( INTERJECTION). Without your knowledge more than l i k e l y ? But t h i s i s , I mean, th e f i g u r e s t h a t are here, I am j u s t lookin g a t b a l a n c e s , am I r e a d in g £3 m i l l i o n ? 22 23 Yes. 105 Q. This i s a s ta te m e nt of accounts of Guinness Mahon 24 Cayman Tr ust with a number of t r a n s a c t i o n s r e l a t i n g 25 t o o t h e r people in i t , whose names we have b l o t t e d 26 out, th e y have n o th in g to do with you a t a l l ? 27 A. 28 106 Q. 29 Right, r i g h t . The only t r a n s a c t i o n s r e l a t i n g to you are th o s e two 1 2 107 Q. 3 You can ign ore th o s e b a l a n c e s , which i s the accumulation of accounts of a whole l o t of people? 4 A. 5 108 Q. Right. JUDGE O'LEARY: We a re not s u g g e s ti n g you had £3 m i l l i o n S t e r l i n g ? 6 7 109 Q. 8 A. 9 110 Q. MS. MACKEY: Not a t a l l , no? I would l i k e to know where i t i s . No, not a t a l l . Those b a la n c e s are not yours. The items r e l a t i n g to you a re th o s e two very small ones? 10 11 A. 12 111 Q. Yes. JUDGE O'LEARY: 13 Could I e x p l a i n t o you, Mr. Hyland, th e system 14 the y used was t h a t when th e money went out to the 15 Channel I s l a n d s and went through Cayman back to 16 Dublin i t did not come back i n t o one account f o r 17 each i n d i v i d u a l ? 18 A. 19 112 Q. 20 A. 21 113 Q. 22 A. 23 114 Q. Right. I t came back in grouped accounts? Yes. There could be dozens? Yes, okay. This i s one of th e grouped accounts and th e only way 24 we can f i n d out who was in th e grouped accounts i s 25 by c lu e s l i k e t h i s ; do you un de rstand? 26 A. 27 115 Q. 28 29 Yes, I d o . There might be l o t s of o t h e r people t h a t we have sim ilarly id entified. 116 Q. MS. MACKEY: I r e a l l y have only one 1 2 Hyland, t h a t i s in r e l a t i o n to the time a t which you 3 te r m i n a t e d t h i s arrangement. 4 your s ta t e m e n t, E x h i b it 1, t h a t a t a given p o i n t you 5 broke o f f your r e l a t i o n s h i p with G. B. M i ll e r ? 6 Yes . 7 117 Q 8 A 9 118 Q You t e l l us t h e r e in At t h a t s t a g e . . . (INTERJECTION)? Well, we s o l d th e company. The company was s o ld . The company was s o l d and a t t h a t s ta g e you 10 l i q u i d a t e d your a s s e t s , you c lo se d 11 down.. . (INTERJECTION)? 12 A 13 119 Q 14 A 15 120 Q 16 A The small amount t h a t was l e f t . You withdrew whatever t h e r e was form th e t r u s t ? Yes . You say you p a r t e d company in 1984? The company was s o l d in 1984 and I remained on as 17 managing d i r e c t o r of i t but working f o r a Swedish 18 m ultinational. 19 121 Q Could i t have been some time a f t e r t h a t t h a t you 20 a c t u a l l y withdrew the f i n a l amount. 21 l oo kin g a t t h i s t r a n s a c t i o n on page 59, E x h i b it 3, 22 i n r e l a t i o n to Jean Hyland and t h a t i s October '85; 23 is th a t possible? 24 A I am j u s t I would have thought t h a t - - I mean, q u i t e h o n e s t l y 25 I would have thought in '84 because my r e c o l l e c t i o n 26 was t h a t we s o l d - - i f you say i t i s October '85, I 27 thought we f i n i s h e d . . . (INTERJECTION). 28 Do you have any documents r e l a t i n g t o the 29 transactions ? 1 I d o n ' t , no. 2 we got very l i t t l e documents. 3 123 Q 4 A 5 124 Q 6 A As I s a i d in my s t a t e m e n t , E x h i b it 1, You do say t h e r e t h a t you were shown f i g u r e s ? Yes . Who showed you those? I would have thought Padraig C o l l e r y . We were 7 p a r t i n g company, J e f f m i l l e r and myself were p a r t i n g 8 company, we had t h i s approach from a company c a l l e d 9 Kema-Nobel, who were s e t t i n g up, t h e y had bought a 10 company in England and th e y were s e t t i n g up, i f you 11 l i k e , a new v e n tu re f o r them o u t s i d e t h e i r normal 12 bu s i n e s s and th e y made us an o f f e r . 13 money f o r my s h a r e s . 14 of th e de al was t h a t J e f f M i l l e r would r e t i r e . 15 125 Q 16 A I received They asked me t o s t a y on, p a r t Yes? But we had a s l i g h t f a l l i n g out or more th a n a 17 s l i g h t f a l l i n g out a t th e time of t h i s de a l because 18 he wanted to s t a y on and th e y d i d n ' t and t h i n g s got 19 a l i t t l e bit difficult. 20 126 Q 21 22 You t h i n k i t was Padraig C o l l e r y who would have shown you a st a t e m e n t a t t h a t s tag e? A Yes, a t t h a t s t a g e and t h a t i s why I say t h a t I 23 thought th e t h i n g had - - because my r e c o l l e c t i o n was 24 t h a t I had very l i t t l e money l e f t a t t h a t s t a g e . 25 127 Q 26 Did he give you th e s ta te m e nt or j u s t show i t to you and ta k e i t away? 27 A 28 128 Q 29 A I t h i n k he might have given Mr. M i l l e r s t a t e m e n t s . But d id he give you any? 1 129 Q documents, or from the Channel Is l a n d s ? 2 3 Did you a t any s t a g e get any th in g from him, any A No, c e r t a i n l y not from th e Channel I s l a n d s . Whether 4 I got 5 r e c e i v i n g any kind of w r i t t e n documentation. 6 c e r t a i n l y d o n ' t have - - i f th e q u e s t i o n you ar e 7 le a d i n g on to i s , do I have an yt hi n g, th e honest 8 answer i s I d o n ' t , but I have no firm r e c o l l e c t i o n 9 of r e c e i v i n g any th in g a t th e time. - - I have very l i t t l e r e c o l l e c t i o n of 10 130 Q Very good. 11 131 Q JUDGE O'LEARY: I have no f u r t h e r q u e s t i o n s Mr. Hyland? J u s t a few, yes. What was the name of th e t r u s t 12 13 14 I t h a t was e s t a b l i s h e d ? A The name of t r u s t was I t h i n k Goldtan. I t i s e i t h e r 15 G-O-L-D-T-A-N or G-O-U-L-D-T-A-N or G-O-L-T-A-N. 16 t h i n k i t was, you know, one of th os e o f f - t h e - s h e l f 17 companies or t r u s t s . 18 132 Q 19 20 Yes. That was i t . I Do you know what d a te i t would have been e s t a b l i s h e d ? A Going from my s ta t e m e n t, E x h i b it 1, I seem to 21 remember t h a t a l l t h i s happened, i t had t o be p r i o r 22 to '77 because t h a t i s document you s e n t me. 23 133 Q 24 A Yes ? I n c i d e n t a l l y I have never r e c e i v e d any of t h e s e 25 documents from G. & M., my u n d e rs ta n d in g was t h a t 26 documents which were sub mit ted should have 27 b e e n . . . (INTERJECTION). 28 134 Q 29 A Have you r e q u e s t e d them? No, I never r e q u e s t e d them but I would have thought 24 1 t h a t th e y would have s en t - - you know, i f th e y were 2 sending you documents th e y would have s e n t me 3 documents, which th e y have never done. 4 135 Q I t h i n k th e y are inun da te d with t h a t s i t u a t i o n but 5 I t h i n k you can obvio usl y go and r e q u e s t documents 6 from them? 7 A 8 136 Q 9 Yes . They might not have th e same amount of d e t e c t i v e work as we; do you u n de rs ta nd what I mean? 10 A 11 137 Q Right, yes. They have o t h e r jobs to do as w e ll . I f you had a 12 b ig account in your own name t h a t might be one t h i n g 13 but t h e s e a re only, i f you l i k e , s c a t t e r e d 14 references ? 15 A 16 138 Q Yes . A ll r i g h t , t h a t i s the name of t h a t , t h a t i s number 17 one. 18 £25,000, and r e a l l y the amount i s of no g r e a t 19 re le v a n c e to us I can a s s u r e you, d id you r e c e i v e i t 20 i n one, two, twenty or a hundred t r a n c h e s ; do you 21 u n de rs ta nd what I mean? 22 A When you say you r e c e i v e d ap proxim ately I t would have been a m u l t i p l i c i t y over a p e r i o d of 23 y e a r s, you know, i f I was going on h o li d a y s or 24 something l i k e t h a t I would go in and I s us p e c t t h i s 25 i s where my w i f e ' s name was brought i n t o t h i s , she 26 w o u ld n 't have r e a l l y had a c l u e . 27 "Would you mind p i c k i n g something up f o r me?" 28 We w i l l not b o t h e r he r, you can r e s t a s s u r e d of 29 that? I would j u s t say 1 2 140 Q. 3 M u l t i p l i c i t y of small sums, would th e average be £500? 4 A. Probably £1,000. 5 141 Q. Probably £1,000? 6 A. You know, £500, £1,000, £1,500, pro ba bly not much 7 more. 8 have no r e c o l l e c t i o n of th e time. 9 142 Q. I q u i t e h o n e s t l y d o n ' t know, t h i s £2,500, I Could I ask you about th e p h y s i c a l p ie c e of paper 10 you would ge t in your hand when you s a i d you wanted 11 £ 1 , 000 ? 12 A. I have no r e c o l l e c t i o n of a c t u a l l y g e t t i n g a 13 p h y s i c a l p i e c e of paper o t h e r than going i n and 14 c o l l e c t i n g money, now, whether we s ign ed f o r 15 anything. 16 143 Q. MS. MACKEY: 17 Hyland? 18 A. 19 14 4 Q. 20 A. 21 145 Q. 22 A. 23 146 Q. 24 A. 25 Oh, i t was cash. JUDGE HYLAND: Cash? Yes, I r e c e i v e d cash. Cash? Yes. Mr. C o l l e r y would arra nge t h a t ? Yes. I t was simply a q u e s t i o n of going i n and c o l l e c t i n g i t over the co u n te r . 26 147 Q. 27 A. 28 148 Q. 29 I t was cash the n, Mr. MS. MACKEY: And i d e n t i f y i n g y o u r s e l f ? Yes, obvio us ly. JUDGE O'LEARY: Do you remember i n 1982, 1 want t o ask you about, do you remember i n 1982 you 2 deci de d to make an investment I t h i n k which r e q u i r e d 3 borrowing money from ICC? 4 warehouse? 5 A. 6 149 Q. Yes. Was i t th e purchase of a I bought a warehouse in Coolock, c o r r e c t . That r e q u i r e d th e borrowing of money from, I t h i n k 7 ICC but you had an i n t e r i m or a b r i d g i n g f in a nc e 8 s i t u a t i o n where you were a s s i s t e d by Guinness and 9 Mahon; do you remember t h a t ? 10 A. 11 150 Q. Do you remember g e t t i n g some £40,000 from them f o r a p e r i o d of some months? 12 13 I don't. A. No, b u t, I mean, I am not saying t h a t I d i d n ' t , 14 obv io us ly you have documents t h e r e . 15 a s t r a i g h t forward arrangement. 16 151 Q. 17 A. 18 152 Q. 19 A. A ll I can say r e a l l y i s t h a t you a p p l i e d f o r i t ? Yes. I cannot say you a c t u a l l y got i t ? That would have been th e p r i c e of th e u n i t I bought, yes . 20 21 I thought I did 153 Q. Do you remember then an e a r l i e r , s m a l le r sum of 22 money t o do with a t a x scheme, where you borrowed 23 money from Guinness and Mahon to t i d e you over u n t i l 24 you got a t a x re fun d; do you remember t h a t ? 25 A. 26 154 Q. 27 A. 28 155 Q. 29 No, but would i t be l i n k e d - - was i t l i n k e d to t h a t . No, no thi ng a t a l l to do with t h a t ? To th e purchase of the warehouse. I t might have been l i n k e d in t h i s way, I un de rs tan d 1 2 3 156 Q 4 A 5 157 Q 6 A As a r e s u l t of t h a t your t a x was reduced? C o rr e c t, yes. Do you remember t h a t ? I know th e scheme, so I can remember t h a t , but i f 7 you are asking me do I remember th e s p e c i f i c d e t a i l s 8 th e answer i s no. 9 158 Q I wonder, Ms. Cummins, would you show Mr. Hyland 10 page 33 and 34? (Same Handed) You were s t i l l with 11 M i l l e r s a t t h a t s t a g e , E x h i b it 4? 12 A 13 159 Q 14 A Yes . Do you remember t h a t scheme? The answer i s no I d o n ' t . But i t does not seem, I 15 mean, th e I n d u s t r i a l Bu ild in g Allowances were 16 available. 17 160 Q 18 A 19 J u s t re a d in g b r i e f l y through i t i t seems t o me t h a t t h e r e i s n o th in g i l l e g i t i m a t e about i t . 20 161 Q 21 A 22 162 Q 23 24 Yes ? No, no, I am not s u g g e s ti n g t h a t f o r a moment? Right. A ll I am doing with t h a t a c t u a l l y i s t r y i n g to t e s t your memory; do you remember i t a t a l l ? A I can c e r t a i n l y remember buying th e b u i l d i n g and the 25 main purpose of buying th e b u i l d i n g was t o a v a i l of 26 th e allowances which were a v a i l a b l e a t th e time. 27 163 Q 28 A 29 164 Q Nothing wrong with t h a t ? But i n terms o f . . . ( INTERJECTION). You do not remember th e d e t a i l s ? 1 2 165 Q. Would you show Mr. Hyland page 24? This i s in 1977 3 you borrowed £2,500 from Guinness and Mahon; do you 4 remember t h a t , E x h i b it 5? 5 A. No. You asked me t h a t in my s ta t e m e n t, E x h i b it 1, 6 i n th e o r i g i n a l document and I s a i d "No, I had no 7 r e c o l l e c t i o n " and I r e p e a t e d t h a t e a r l i e r on. 8 d i d n ' t r e c e i v e t h i s document b e f o r e , E x h i b i t 5. 9 166 Q. 10 A. 11 167 Q. I You never r e c e i v e d the document? No, I am not saying t h a t , I mean I s ign ed i t . Would you look a t the second page, i s t h a t your signature? 12 13 A. 14 168 Q. 15 I would t h i n k i t i s , yes. In th e re c o rd s of Guinness and Mahon t h a t loan i s d e s c r i b e d as a s u i t a b l y s ec ure d loan? 16 A. 17 169 Q. 18 A. In t h e i r r e c o r d s , yes. Yes, a t page 26, E x h i b it 6? I have t h a t document, you s e n t me t h a t with the le tte r. 19 20 170 Q. 21 A. 22 171 Q. 23 Yes? So, I have seen t h i s b e f o r e . S u i t a b l y s ec ure d means t h a t i t was backed with funds elsewhere? 24 A. 25 172 Q. 26 A. Yes, you e x p la i n e d t h a t . Do you remember t h a t ? No, I s a i d t h a t e a r l i e r on t h a t I d o n ' t remember 27 t h a t but I am not denying i t , but i n terms of why I 28 would ta k e a loan f o r £2,500 and t h e y d o n ' t even 29 mention in t h i s why. 1 173 Q was a d i f f e r e n t sum of money than i s i t i s now. 2 3 A 4 174 Q 5 Yes . I suppose £2,500 in 1977 was a t h i r d of th e valu e of a t h r e e bedroomed semidetached house? 6 A 7 175 Q 8 A 9 176 Q Yes . In c u r r e n t terms i t would be £50,000? Yes . I t i s a l o t of money. Do you remember anything about i t ? 10 11 I suppose, Mr. Hyland, in f a i r n e s s , i n 1977 £2,500 A The honest answer i s no. I mean, I query th e value 12 i n 1977 because we had c o n s i d e r a b l e i n f l a t i o n the n. 13 I know t h a t I bought my house f o r £18,000 i n '75 and 14 I know t h a t i t had gone up c o n s i d e r a b l y i n value in 15 two ye a r s, between 20 and 25 p e r c e n t . 16 177 Q 17 now? 18 A 19 178 Q A 22 23 Half a m i l l i o n , so, you ta k e t e n p e r c e n t of t h a t I c a n ' t deny t h a t I took i t out but what i t was f o r I have a b s o l u t e l y no ide a. 179 Q 24 25 Oh. £50,000? 20 21 Even i f i t i s t e n p e r c e n t , what i s th e house worth Do you remember th e money in th e Channel I s l a n d s being used as s e c u r i t y f o r t h a t ? A I c an 't, I mean, I can only t e l l you under oath t h a t 26 I have no r e c o l l e c t i o n of t h i s loan but i f t h a t 27 document t h e r e says t h a t i t was s u i t a b l y secu red and 28 you say in your l e t t e r t h a t s u i t a b l y s ec ure d was a 29 code f o r i t be ing backed then l o g i c a l l y I have to 1 2 180 Q 3 A Yes ? But i f you ask me have I any r e c o l l e c t i o n , with my 4 hand on th e b i b l e I can say I d o n ' t have any 5 recollection. 6 181 Q MS. MACKEY: 7 I t h i n k you s a i d y o u r s e l f t h a t p a r t of the 8 arrangement about the t r u s t was t h a t i t could be 9 used as backing? 10 A Yes, but more f o r the b u s i n e s s . As th e o r i g i n a l 11 scheme was proposed i t was a means of p ro v id i n g back 12 t o back f i n a n c i n g f o r th e b u s i n e s s . 13 182 Q JUDGE O'LEARY: 14 Mr. O'Regan, was he a 15 16 I want t o ask you about p a r t y t o t h i s o f f s h o r e d e p o s i t scheme? A No, t o th e b e s t of my knowledge he was not invol ve d 17 in t h a t s e c t i o n of i t because he was running one 18 s e c t i o n of th e b u s i n e s s , th e income stream was 19 coming from a n o th e r s e c t i o n , so, when he bought i n t o 20 th e b u s i n e s s he bought in on th e v a l u a t i o n , i f you 21 l i k e , we s e p a r a t e d out and he bought i n on a 22 v a l u a t i o n which only took i n t o account th e b u s in e s s 23 t h a t he was r e s p o n s i b l e f o r , i f you l i k e . 24 183 Q 25 A Yes ? I t sounds l i k e a convoluted d e a l . The o t h e r t h i n g 26 t h a t I am anxious about i s t h a t he had a p e r s o n a l 27 t r a g e d y some year s ago, h i s only son was k i l l e d in a 28 drowning and he has had enough problems, h i s wife 29 had a brea k down. 1 184 Q t h a t re g a rd 2 3 The in f o r m a t io n you have given a s s i s t s us g r e a t l y in 185 Q MS. MACKEY: 4 checked th e m a t t e r out 5 6 with Mr. M i l l e r ? A 7 8 I t h i n k you s a i d you I checked th e m a t t e r with Mr. M i l l e r and he i s adamant t h a t he was not invo lve d. 186 Q JUDGE O'LEARY: 9 The only t h i n g t h a t i s l e f t then, Mr. Hyland, i s 10 t h i s , th e t r a n s c r i p t w i l l be ready i n due cou rse. 11 Ms. Cummins, our s o l i c i t o r , 12 in t r o d u c e d you? 13 A 14 187 Q I am not sure i f I No, she in t r o d u c e d h e r s e l f . Ms. Cummins, our s o l i c i t o r w i l l c o n t a c t you and a t 15 t h a t s ta g e arrangements can be made f o r i t to be 16 signed? 17 Yes, okay. 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW WAS THEN CONCLUDED XML \V\cs ?a CM!?le 5 0&0: hp '3 CS ^O S /V o ^ ~ & -v X . d / 'l t $ /j£ i/< s z 7 )d > s y ^ <1 ^ J 0LZ~£ ^ /^ o / a A a s .^ j /£ .< • .* » v < c / A- & / { 9 t^ c v U s L '/ i a «'v/^o f ' Q C C 9 >*.*. / ” & /£ / v *s l . \f * .5 /f #f / -v £e& *^ y^ ^ 7 7 ^ e - s 2_ j / £*> **~A-< L-SC ’ & t . /i M <%'3>J%Lf-, d • /& <£•• C’f k / ' V? / fc ' ^ . r /V/ & l A. \ 7d £cvA<^ J? ^ * ~ . jC s tS . & /% -C o s z U . e e ld . , / a to'Jir e^z ,° C * < / ^ / ’ y e t A ^ $ i ^ / ) & f c - t-^ c -5 ^2 . ^ # (* { / ■* / < - L 4 ) ‘f l j L c J 'i o 'J 4 * /k Z s ^ \P _- -_ <4. t f /tZ Z / < 'to d & d j* _ 5& ~ ~ 5 t< r? ? - s P& ^< . y g jT v ? 'tO tJ U v t . ^ A fth S G L Q f / ) / 'U l+ J -3 -0 . J & £-'C rG i ir ^ c ^ ' /^£ * + .< \ B - L 'tr - L S 'i - t & 't /C ^ /k . 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J f/Z > tA - *£-/" & ' & \jb lA> ic % tl_ £ c /f Z s i A /V c ^ tV f / r t s * C *£**<*£ >v7 a 7 ^ 7 &&&* c a 3 ~i / ” } 1 ^ J '& s z , # ,& , 1 {# ([? ■ (t & /■ d a / . - , * , J £ € f ,ts < _ c * -.# - ^ M c U h -j /o ' J s ft* J ~ C t^ t£ . ^ 5 ^ c /* & / ; —c . tO S^v « /C /■ ^ k>c S * *Lc / *0 /b M - .o f /^ *.£ eM c ^ & * -/ M < * * 'c ,a t ,- - j /'t't-M. •» ^ J$£2-^<_3 & < -£tC .SA~. 4 H - S ,^ c $ s y /tf* /? o y U ^ A jir A f/' /o C /.A tC fte .f.& i., /* t# 't/< tj <7^7 kr" £ } //£ * - A. $*<£ tp< c+ *t.$ A)<- /H.y~y/U ^ l /$**■ S * «-€-5 5 < /tZ * /4— C ^ A / f> r S A) £ -9 C ^ & *tk -J & + -•£.. /l^r £ s /~ - * ~ s s d c ^ ' ^ < H /'<_ S , l £ ,3 ^ o . 4 d / - ^ f e ^v. ^ a ^ A j / 4 * rr ^ 1 *£< -*{ S /C C . t^ L f. f S tc c . ? tlr r * ~ c l r f Z '* - /^75^) ^ 3 & "$ p * ' * l ^ w W '? * + ^ ^ / € ^ « / ^ ^ ^ L o *7 ^ e d '- t f a Z o ----- ^ f r 'C 't x X M ^ i^ ltt^ L S pre~i>&&€^ / < -< - ^ s ^ ^ . r /iy * /£ r > y £ ^ ^ Co ^ - t i L , * * * £ • ^ ■ ikiJL G *-^r G tfjL *> & uJ5t*~*-2>S O t i s ? ' # - • G ' J v - r s ^ L ,^ /j^ d /$*r£/s ^ iT j^ ^ ^ d C o A * - ^ ^ u S *J^ m o lS e & A ) ( P wi w / / ©VC ^ C '/ & ~JL * y ? j ^ jo ^ I / & C. ^ S * y ^ l & y & % > J& A> /fc$' ,^ /u ^ _ / f e /^ 0 L - c tM ,^ > * + * s ^ i ^),«>^ ^ J # £ 0 L & £ ch rj A z v C -* /' tH < Z ~ ^ - S ( h \s c r < L .y .* rj & e tf r ~ A { /i M •*'*<-% t*SK- fr&JZQ,^* aJ r u -l fc\ * Ai a -J L ° ~ U3<- /*^f$S—r,t' j/'V j • r $ * T & «< , 5 i M .< l L s ^ ^ # ..* ^ a d tL fr^ - {X*.l. ti^ ✓ « .. fA .A i* ^ .— . y ^ l u « - i ^ /© H ,S / ~ J d-^/0^> / ^ 6^. a Y fo s / i t ^3 p t, / * / ^ o m /-j / J i /» rv/ / 2 c ^ L u t ^ / , n ^ /-V . y + y A /£ ; d * £ . . bt <£e ^ * t + y = A .a ^ U h - d . pc. 'f < ^ 0 K T l^ s o -h /J c 7 * ~ i / i # Y ^ C e> * -/'# -tS fe{ •/&. ^ £*£*£*- A S f/l mo.jkJ'^ ____•--------- /f t i^ jL ^ ir ^ Cfa P.I------ *? o - — . s ~- . ^ 'S' /jX /L . q -^ . — tty /t--~ j *C* rfo £ j L s2./^& ** A f/k^ &> / u ^ s - t - ^ l^ J iitJ L . 5 " a / > S ^ * < -g £ „ ^ L f ^ ^ ' J f y $ /^ s T /'' ^ >P £ 0 .* $ . /< z s * tf b /A - S ) *1 u s f M r A $ a / j t - « s - * j z . y^- /b X .o~ i/< ^ Af<_ * -i Ax^_ £ /- < - / cl*. A '^ - <5> / W ' < 2 / ^ z f e A / Y ^ ^St) y A J -//^ - /~‘C £ c * fI e -* £ ' / . f # 5 f~j/ A * -£ _ ^ 5 f o tC o i- y / £ r 0 & j l /£ ~ ^ *Y\/^ 5 /.& & /^ & S /fe T ~ tP A ^ 1 /C .S / /d < ~ s< < 0 - 0 t o o l ' d / i t - / ^ r & $ ~ c .s? /£ c . £? n. /^ S '/f a ta ,~ c ^ 2 tJ A >\ * * - / ’■ <. /? c CuL.sZ.G.'t^ $ < -* (. & \>C f f /<£V» ©-*£ / “i C L ^ f— t£ n $ * ~ iX - ^ /p * & v f fi- t?t*. 6 c * $ £ i§ (h A .< £ s£ <3 J A C ^ l . 3 ^ / ^ . a x - C -------- /^ C C 'G -s-tJ-' ^ /£ c c o r * < ~ . A & t- a 7 /3 L /-< _ / H 4 ' -'■ / z tst-% ±~L jfizo + < S b * * -< j£ _ s /je ? s > /7 fe ^ z . /* \ /^ C % /£> £ '!> t> ^ ,ffeU i v / i /U 4 - /I / • o s " . o / . - G+M G U J N N E S S + M A H O N L HANXOtS *eeouM» GUIN/tfiSS MAHCM CA»KA« W U S T i COILBW CNUII ooui jvMJUCCMTl m m k iu m ■I •l •A, ^ AT .14*88«4 ON CHG3.lO.3_ I . I w c a iw .■ 3-05 , I •. •< * 2a*E8«j 6XCH. . F /X OFAi.IHC.SU* s r a R6"hylaho 1402a* •I i>. ' .If- 9 0 .0 0 . ?*»•MMt I CMNINMWKUAI.AM.TgM( UAftl MM1ft*Nm4 C U IM 'FS S c/a j p HAHON c CAT»*A*t TPUST / CCLlHCE +M MXCNS CUtMS! ta««a<*Mia«Mk>i' g.u. ua tmmm MIV’ « « > «•0^0*5* > 1HCT(» iTAtmjur PiCC MO. mo. 4* 4 &M I U tftl F ii£ ~ 1 C olm H y la n d / EK t Amounh £2/500 Purpose: Persona! Loan Term: Rat*; Drawdown: Security: * v . 20/3/78 ‘' . 13% fixed « Immediate Suitably Secured. r* S d & k J ' ffe u v inu 4rfxth- %j&ja u^du. ■o M < 0^ 22 64 Q. 23 Yes. & 1 a . Yes, th is is w hat I am c o m i n g t o n o w . w as t h a t a com pany - - 26 w ere d i s t r i b u t o r s 29 iw o . G e n e r a l l y w h at w as t h e sch em e t h a t w as 25 28 b o p erated ? 24 27 ^ tu rftU iC Q 65 Q. Yes? A. And i t q u ite w as a fo r, o n e o f o u r c o m p a n ie s t h a t p a id u s s m a lle r p a r t we o n c o m m is s io n o n l y . o f o u r b u s in e s s b u t i t s u b s t a n t i a l a n d t h e y w ere t o 13 T he schem e se t up, w as o r th e y 1 w o u ld s e t u p , 2 o v e r s e a s com pany. 3 66 4 Q. Yes? A. A n d we w o u l d p a y t h a t J e r s e y w h ic h was a n " com pany o r t h e y w o u ld a p p o i n t 5 th at 6 th e y s h o u ld m arket t h e i r goods t o 7 A n a g r e e m e n t w o u l d b e d r a w n u p a n d we w o u l d 8 r e l i n q u i s h h a l f o u r c o m m is s io n . 9 was 5 p e r c e n t . 10 . 12 com pany a s a d v i s o r s 67 Q. A. 14 c a n 't r e c a lle d -- th e l a s t m e e t i n g we w e r e a t who t h a t c o m p a n y w a s . You s e e , 17 by B r it is h 18 T h is 19 d o in g 20 money i n 68 22 in to th e 69 it w ith a g e n ts a l l 70 27 A. P a rt of t h e ir Q. D id B r i t i s h . Yes, yes. Q. And, how a 71 . Q. who w e r e o u r s u p p l i e r s . o v e r t h e w o rld , k e e p in g overseas. c o m m is s io n . C e e d a ck L im it e d fo rm a com pany o n y o u r in G uernsey? . . . (IN T E R JE C T IO N ) ? B a s ic a lly H a lf d id n 't have London and v a r io u s p la c e s Yes? a th e y s a id w as n o t h in g u n u s u a l f o r them b e c a u s e t h e y w e re in s tr u c tio n s 25 I have T h i s w as a co m p an y f o r m e d C eedack L im it e d , Q. 24 29 O ur c o m m is s io n re m em be r t h e name o f t h e co m p a n y b u t I a n y th in g to do w ith t h a t . 28 m arket. H a l f t h e c o m m is s io n w as tw o a n d a 16 26 the I r i s h o n how W h a t w a s t h e n am e o f t h e c o m p a n y ? I * 15 23 m arket, G u e rn s e y com pany. 13 21 to th e I r is h h a l f p e r c e n t a n d t h e s e w o u ld b e p a i d 11 ‘ a com pany i n o n my i n s t r u c t i o n s . t h e c o m m is s io n t h a t y o u w ere e n t i t l e d to t h is com pany? t o w ent 0 1 2 72 3 4 73 A. Yes. Q. C a n y o u r e m e m b e r t h e n am e o f t h e c o m p a n y ? A. I Q. Have you any re co rd s a v a ila b le a s to t h is 5 74 8 9 75 10 11 r e m e m b e r t h e nam e o f t h e c o m p a n y . . tr a n s a c tio n ? 6 7 c a n 't 76 12 A. I never kept any records of t h is . Q. Yes? A. I Q. Who . . . ( I N T E R J E C T I O N ) ? A. I Q. D id M r. R e id i n A. I ju s t d id n 't keep an y. am l i k e th at. SKC ag en ts 14 s itu a tio n 15 s a id , 16 f o r everybody a l l 77 Q. 18 f o r them s i n c e 78 19 3 7 and I e x p la in e d th e r ig h t. th e re is who i s no p ro b le m . I now d e a d , am d o i n g i t o v e r th e w o rld " . T h is w i l l happen th e n . It was w as s e t Yes, it w as Q. T h e m oney, . . . (IN T E R JE C T IO N ). h a lf t h e m oney, w ent i n t o the G u e r n s e y com pany? 22 a 79 24 . Q. a . It w ent in t o W e ll, I 26 tru st 27 in s is te n c e 28 M ahon. Q. com pany, yes. am t r y i n g t o p u z z l e o u t how G u i n n e s s & M a h o n g o t in v o lv e d 80 th is T h e n w h at was t h e r e s t o f t h e a r r a n g e m e n t . 25 29 My f a t h e r h a d b e e n and t h e i r s a le s m anager, "G eoff, A. 21 23 A ll Ceedack. up? 19 20 ...(IN T E R J E C T IO N )? approached B r it is h 13 17 " I in th is o r bankers in am s o r r y . and I th in k th a t th e y to o k on a th e is l e o r s u g g e s tio n i t Was i t th e I s le O f M an a t w h o s e w as, w ere G u in n e s s & O f M an , d id you sa y ? A. 1 No, w ere G u in n e s s 2 a fte r th is 3 G u in n e s s 4 o a th so I 5 X was a s k e d , 6 it 7 M o r ia r t y m e e tin g . 8 in c lu d in g 9 81 10 & M ahon. T h e b a n k e r s w ho l o o k e d com pany o n b e h a lf o f C e e d a c k w ere & M ahon. Now , th is I am n o t -• "W as i t su c h and su c h a com pany? C o lle g e T ru s te e s . Q. Yes? A. A t t h a t tim e i t d id n 't b u t s in c e 13 C o lle g e T ru s te e s b u t I 14 C o lle g e T ru s te e s . 15 G u i n n e s s & M ahon b e ca m e c o n n e c t e d w i t h 16 becam e c o n n e c te d - - 17 G u i n n e s s & M ahon I 18 th e overseas 83 22 is Q. Yes? A. Okay? Q. Yes. A. Now , I have a ls o c lic k T h is 21 why 1 I tho ug ht t h is 26 27 85 28 29 86 you c o u ld j u s t A. Anyw ay. Q. Just A. A ll Q. If it c e r ta in th in k th a t th a t is so, and was it w as how -- ho w I w as a c u s to m e r o f w as - I w e ll, & M ahon. God, w as r a i s i n g I w as 36 y e a r s tw o b o y s a n d I . . . (IN T E R JE C T IO N )? t e l l VIS . . . ( I N T E R J E C T I O N ) ? rig h t, -- th e new spapers. say th at com pany t o G u in n e s s . . . ( IN T E R JE C T IO N ) . If th e n t h i n k t h a t w a s my i n t r o d u c t i o n o f 24 Q. in am v i r t u a l l y a lth o u g h I o f ag e a t t h a t tim e . 84 read t h is cannot p o s it iv e ly 23 25 W as S e v e r a l c o m p a n ie s w e re m e n t io n e d 12 20 but s u c h a n d s u c h a c o m p a n y ," a t t h e l a s t m in d y o u l 82 am u n d e r have got to be ve ry c a re fu l about t h is 11 19 I ’ th en ...(IN T E R J E C T IO N ). you c o u ld j u s t keep i t ...(IN T E R J E C T IO N )? 1 2 87 3 4 88 5 A. It w ent on t h e n . Q. Just A. Okay, I Q. Yes. J u s t keep i t A. Yes, keep i t as w ill. Okay. sh o rt as you can, I I am j u s t g e t t i n g as M r. M i l l e r ? a b it c a rrie d s h o rt a s you ca n ? th in k th a t i s c o n v in c e d t h a t t h i s w hat i t w as. Now, 6 fu lly 7 to ld 8 T h e money i s 9 c o m m is s io n w a s n 't p a i d t o y o u a n d y o u j u s t th at i t w as l e g a l o r I w as l e g a l : " A b s o lu te ly l e g a l , c o m in g i n t o Ire la n d . If 11 T h e R e ve n u e C o m m is s io n e rs . 12 s e p a r a t e com pany o u t s id e t h e j u r i s d i c t i o n 13 and i t 14 89 15 Q. Yes? A. " O c c a s io n a lly t h is 16 17 90 91 20 T h i s m oney i s th e re and i t is g o in g to a o f Ir e la n d m o u n tin g u p . ” com pan y m ay l e n d y o u a b i t Q. Who? A. W h ic h I of Q. Who a d v i s e d y o u a b o u t t h i s ? A. I d id n 't u se . d o n ' t h o n e s t l y know. w ho i t w as. 22 I t h a t w h ile I 23 c o u ld go in t o G u in n e s s 24 my g u a r a n t e e s , w h ic h I 25 w here, 26 . . . (IN T E R JE C T IO N ). 92 Q. 28 29 d id n 't yo u w o u ld n 't h a v e t o a d v is e 21 27 yes. money" o r s o m e t h in g . 18 19 w as your g e t y o u r c o m m is s io n , s ta y in g 1 had been 10 is aw ay. fe lt I I M r. R e id , c o u ld n 't w as i t ? Bay d e f in i t e l y d o n ' t h o n e s t l y know b u t I know t h a t c o u l d n ' t r e a l l y u s e t h e m oney I & M ahon a n d d ra w a g a i n s t w h a t h a d a l r e a d y g iv e n them , s m a ll am o un ts o f money a n d t h a t t h e s e Had you an a c c o u n ta n t a t th is tim e a d v is in g th is then ju s t you on y o u r own t a x a f f a i r s ? A. Not r e a lly , no, I w as -- d is a p p e a r e d m ore o r l e s s 1 2 93 3 4 94 5 6 95 7 8 96 9 10 97 11 12 98 13 14 99 No, 100 18 19 10 1 20 21 A. Yes. Q. Y o u h a d t o m ake A. We h a d Q. M r. A. We m o v e d . . . ( i n Q. M r. M i l l e r ? A. We m o v e d . . . ( I N T E R J E C T I O N ) . Q- M r. M i l l e r ? A. Yes, so rry. Q. Just lis t e n A. A ll Q. I 102 10 3 25 10 4 27 28 29 . . . (IN T E R JE C T IO N ) ? . . . (IN T E R JE C T IO N ). M ille r ? rig h t, ‘ t e r je c t io n ) . t o th e q u e s tio n ? yes. w ant t o know, d id you have an a c c o u n ta n t lo o k in g Yes. Q. D u rin g A. Yes, Q. SKC? A. Yes. Q. D id you have a se p a ra te a cco u n ta n t lo o k in g a f t e r . . . (IN T E R JE C T IO N )? SKC. y o u r own a f f a i r s ? 23 26 ...(IN T E R J E C T IO N )? A. 22 24 j u s t w a n t t o k no w a f t e r y o u r c o m p a n y 's a f f a i r s ? 16 17 I . . . (IN T E R JE C T IO N ). Q. 15 no. a n d X w as 10 5 A. No. Q. Y o u r own t a x a f f a i r s ? A. NO . Q. D i d S K C l o o k a f t e r y o u r own t a x a f f a i r s ? A. Yes. Q. They d id ? A. Yes. y > Y > ' > : > > x y * V > . x x 20 113 Q. 21 A ll rig h t. W hat o c c u r r e d t h e n ? u s w hat o c c u r r e d b r i e f l y 22 a . O ver th e years I m oney fro m G u in n e s s 24 lit t le 25 w o u ld go i n 26 w a s n 't v e r y m uch. 27 th in g s 28 29 114 lik e over th e ye a rs o c c a s io n a lly s a id 23 b it W o u ld y o u j u s t I th e n ? w a n t e d som e & M ah o n a n d t h e r e w a s a l w a y s o f a pause b e fo re I and cash i t , got i t c o lle c t We u s e d i t w ho w o u l d y o u c o n t a c t i n A. P a d r a ig C o lle r y . a and then X t h e m o n ie s . It o n ly f o r h o lid a y s th at. Q. te ll G u in n e s s & M ahon? and 1 2 115 Q. A. Padraig Gallery? Yes. Appendix XV (152) Mr Denis McCarthy 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr D enis McCarthy. a) Transcript o f evidence o f Mr Denis McCarthy dated 15 June 2000. b) Statement o f Mr Denis McCarthy o f 8 June 2000. c) Guinness and Mahon statement o f 12 January 1983 - GMCT/College. d) Guinness and Mahon statement o f 20 November 1981 - GMCT re College. e) Declaration o f Trust - the Garenne Trust. f) The Garenne Trust - balance sheet as at 31 December 1985. Correspondence received from or on behalf o f Mr Denis McCarthy. a) Letter o f 14 December 2001 - Matheson Ormsby Prentice Solicitors to Inspectors. mr. d e n is Mc Ca r t h y UNDER OATH ON THURSDAY, 15H JUNE 2000 I h e r e b y c e r t i f y th e f o l l o w i n g to be a t r u e and a c c u r a t e t r a n s c r i p t o f my s h o r t h a n d n o t e s i n th e above named i n t e r v i e w . Stenog rap her THE INSPECTORS: MR. ROWAN FCA MS. MACKEY B . L . S O LIC IT O R TO THE INSPECTORS: MS. M. CUMMINS INTERVIEW EE: mr. INSTRUCTED BY: MR. ANTHONY 0 ' GRADY d e n is Mc Ca r t h y MATHESON ORMSBY PRENTICE SO LIC ITO RS 30 HERBERT STREET DUBLIN 2 . 1 2 3 4 MR. ROWAN: Good m o rn in g , 5 Mr. M c C a r t h y . 6 in tro d u c e m y s e lf, 7 my f e l l o w I n s p e c t o r s , 8 Mr. M c C a rth y , 9 is it th is a T rib u n a l, L e t me I am P a u l Rowan and t h i s is one o f Ms. Noreen Mackey. i s no t a C o u r t t h i s m o rn in g , it is an i n t e r v i e w . As s u c h , no r if 10 d u r i n g th e c o u r s e o f th e i n t e r v i e w you w is h t o s e e k 11 some g u id a n c e from y o u r s o l i c i t o r , p l e a s e a s k us to 12 s t o p and we s h a l l do s o . E q u a lly , if your s o l i c i t o r 13 w is h e s to o f f e r you some g u i d a n c e , if he would a s k 14 us t o s t o p e q u a l l y and we w i l l p r o v i d e t h a t 15 o p p o rtu n ity . 16 17 We a r e g o in g to make a r e c o r d o f t h e i n t e r v i e w and 18 a f t e r th e i n t e r v i e w we w i l l a s k you t o come and s i g n 19 a t r a n s c r i p t when you have had an o p p o r t u n i t y to 20 r e a d th r o u g h i t . 21 22 May I a s k Ms. Cummins, o u r s o l i c i t o r , 23 the oath , 24 25 26 27 28 29 p le a s e . to a d m in is te r 1 2 3 4 MR. ROWAN: Mr. M c C a rth y , 5 is 6 7 Ms. Mackey g o in g t o a s k you some q u e s tio n s . 1 Q. MS. MACKEY: Mr. M c C a rt h y , 8 you s e n t us in a statem ent, 9 have a copy o f i t 10 A. 11 2 Q. do you w it h you t h e r e ? Yes. I w ould l i k e t o go th r o u g h t h a t i n due c o u r s e . Just 12 b e f o r e I s t a r t to do t h a t , 13 w ould t e l l us a l i t t l e 14 b a c k g ro u n d i n a s b r i e f a f a s h i o n as you ca n so we 15 can e s t a b l i s h your b u s in e s s ? 16 A. 17 3 Q. 18 A. When I l e f t Yes, f o r th e r e c o r d i f b i t ab o u t y o u r c a r e e r and s ch o o l? what y o u r c a r e e r h a s been to d a t e ? My f a m i l y b u s i n e s s was O d e a r e s t , 19 was found ed by my g r a n d f a t h e r , 20 O 'D e e , 21 4 Q. 22 A. 23 5 Q. 25 A. 26 6 Q. 27 A. 28 7 Q. 29 O'Dee & Co. w hich th e l a t e M ic h a e l some 1 2 0 y e a r s ag o. You went i n t o t h i s b u s i n e s s ? Yes, I went i n t o t h e b u s i n e s s w it h my f a t h e r and I went i n w it h my y o u n g er b r o t h e r . 24 you You f i n a l l y r o s e to what p o s i t i o n i n i t ? When my f a t h e r d i e d I became c h a ir m a n . You became c h a ir m a n ? Yes. T h a t was what y e a r ? 1 8 Q. 2 A. 3 9 Q. 4 5 R o u g h ly th e 1 9 6 0 ' s . I n th e 1 9 6 0 ' s some t im e . Would i t be th e l a t e 19 6 0 's? A. M id d le 1 9 6 0 ' s , th at is to t h e b e s t o f my r e c o l l e c t i o n now. 6 7 R o u g h ly . 10 Q. 8 If you c a n n o t remember a n y t h i n g , ju s t 9 A. 10 1 1 Q. it is q u it e okay, say. I w i l l do my b e s t . Of c o u r s e , but i f you c a n n o t be s p e c i f i c about 11 dates, 12 became c h a ir m a n o f O d e a r e s t i n th e m id 1 9 6 0 ' s and 13 you c o n t in u e d on u n t i l ? 14 A. j u s t t e l l us t h a t and t h a t i s fin e . You I t was t a k e n o v e r th e n i n t h e 1 9 7 0 ' s by an E n g l i s h company c a l l e d Bondworth. 15 16 1 2 Q. 17 A. 18 1 3 Q. 19 A. 20 14 Q. 21 A. C a lle d ? Bondworth. D id you c o n t i n u e on? I c o n t in u e d on, yes, As c h a ir m a n ? No, no t a s c h a ir m a n . 22 m anaging d i r e c t o r . 23 k n o w le d g e . 24 1 5 Q. 25 A. w it h my b r o t h e r . Yes. I was m anaging d i r e c t o r , That i s jo in t t o th e b e s t o f my D id t h a t c o n t in u e th e n up t o ? Bondworth expanded a l o t . They were a B r i t i s h 26 company b u t t h e y expanded i n t o A u s t r a l i a . 27 i n t h e c a r p e t b u s i n e s s m a i n l y , m a n u f a c t u r in g and 28 w h o le sa lin g . 29 f u r n i t u r e and th e n t h e y went i n t o b u s i n e s s i n They were They expanded i n t o t h e m a n u f a c t u r e o f 1 A u s tra lia , 2 shops i n Germany. 3 1 6 Q. 4 A. 5 1 7 Q. 6 A. 7 18 Q. 8 A. 9 1 9 Q. 10 A. 11 20 Q. 12 13 They bo ught a l o t o f D id you have a r o l e i n t h i s ? No, no t r e a l l y . D id you l e a v e a t t h a t s t a g e ? No, I was p a r t o f th e g ro u p . A re you s t i l l w it h them? No. A re you r e t i r e d now? Do you want me t o f o l l o w up what h appened? In s o f a r as i t r e l a t e s t o you j u s t and where you a r e now. A. 14 Bondworth went i n t o r e c e i v e r s h i p and we bought th e company o u t . 15 2 1 Q. 16 A. 17 22 Q. 18 We b e i n g ? A g ro u p , my b r o t h e r and m y s e l f . T h i s g ro u p , it 19 A. 20 23 Q. 21 A. 22 2 4 Q. 23 A. 24 25 Q. 25 A. 26 26 Q. 27 A. 28 27 Q. 29 F r a n c e and Germany. were t h e s e p e o p le who were i n v o l v e d i n a lre a d y ? No, f r i e n d s o f m in e . F rie n d s of y o u rs. Can you t e l l me who t h e y w ere? They were th e M cGrath G rou p. You bought out t h e company? We bought out t h e company from th e r e c e i v e r . The e n t i r e o f Bondworth i t s e l f ? No, no. J u s t O d earest? Yes. T h a t was when, Mr. M c C a rth y ? 1 2 3 D o n 't h o ld me to t h o s e d a t e s . 28 Q. 4 5 Okay, b u t r o u g h l y aro u n d t h e n . ru n O d e a r e s t , A. Yes, is D id you c o n t i n u e to t h a t what h appened? b u t w it h t h e h e l p o f p e o p le who were n o m in a ted from t h e M cGrath G roup. 6 7 29 Q. 8 A. 9 30 Q. 10 A. 11 D id i t It c o n t i n u e to t r a d e u n d e r th e name O d e a r e s t ? d id . Y ou r p o s i t i o n was what t h e n ? F o r a tim e I was m anaging d i r e c t o r and t h e n I t h i n k I became c h a ir m a n . 12 3 1 Q. 13 A. 14 32 Q. 15 A. What i s No, your p re se n t p o s it io n ? I have r e t i r e d . You have r e t i r e d s i n c e when, r o u g h l y ? If I knew you were g o in g t o a s k me t h e s e q u e s t i o n s , 16 and I have no o b j e c t i o n t o you a s k i n g 17 . . . . ( IN T E R J E C T IO N ) . 18 33 Q. 19 A. 20 34 Q. 21 A. 22 35 Q. 23 A. 24 36 Q. 25 A. 26 you c a n n o t be p r e c i s e , that is a lr ig h t. E a rly 19 8 0 's . That i s grand. I c o u l d be wrong ab out t h a t . You a r e r e t i r e d some y e a r s ? Yes. You a r e not i n b u s i n e s s now? I was a d i r e c t o r o f c o m p a n ie s, do you want me to t e l l you ab out t h a t ? 27 37 Q. 28 A. 29 If If you w ould, yes. I was a D i r e c t o r o f E a g l e S t a r f o r ab o u t 25 y e a r s . 1 8 0 th y e a r , 2 on t h e B o ard o f Beaumont H o s p i t a l f o r 20 or 3 25 y e a r s . 4 30 y e a r s . 5 38 Q 6 A so t h e y kept me f o r a lo n g t im e . I was I was on th e B o ard o f Le o p a rd sto w n f o r Le o p a rd sto w n H o s p i t a l ? No, Le o p a rd sto w n R a c e c o u r s e . I was on t h e R a c in g 7 B o ard f o r 30 y e a r s . 8 T u r f C lu b f o r 1 2 y e a r s and I am now p r e s e n t l y 9 C h a irm a n o f t h e Drugs C e n t r e i n P e a r s e S t r e e t . I was s e n i o r s te w a rd o f th e 10 C h a irm a n o f t h e C h a r i t a b l e T r u s t w h ic h fu n d s 11 r e s e a r c h f o r Beaumont H o s p i t a l . 12 39 Q F in e , t h a n k you v e r y much, that i s I am g ra n d f o r y o u r 13 career. 14 ( E x h i b i t 1) 15 le tte r . 16 you have n e v e r to y o u r knowledge k n o w in g ly had any 17 d e a l i n g s w it h t h e company. 18 s t a t e m e n t and i n o u r p r e v i o u s l e t t e r r e f e r s to 19 A n s b a c h e r o r as i t 20 Mahon Cayman T r u s t L i m i t e d . 21 A 22 40 Q 23 I f we can have a l o o k a t y o u r s t a t e m e n t w h ich you s e n t to us i n answ er t o ou r You t e l l us a t (B) o f y o u r s t a t e m e n t t h a t Now, t h e company i n y o u r was f o r m a l l y c a l l e d G u in n e s s Yes . To th e b e s t o f y o u r knowledge you have n e v e r had any d e a l i n g s w it h i t ? 24 A 25 41 Q T h a t's r ig h t . T h e r e f o r e you s a y a t (C) you do no t have an y books 26 or d o cu m en ts. 27 you have had d e a l i n g s w it h G u in n e s s Mahon I r e l a n d 28 and I would l i k e to a s k you ab o u t t h a t i n a moment. 29 You go on a t and o v e r t h e p a g e , You s a y th e n a t (E) (D) t h a t i n t h e p a s t t h e to p o f y o u r 1 s e c o n d page o f y o u r s t a t e m e n t t o s a y t h a t th e b a n k, 2 G u in n e s s & Mahon, 3 t h e r e was an A n s b a c h e r a c c o u n t e n t i t l e d Re C o l l e g e 4 T r u s t e e s i n w h ich was l i s t e d paym ents t o c e r t a i n 5 offsh o re e n t it ie s 6 i n c o r p o r a t e d company named Chunga i n w h ich 7 Mr. T r a y n o r , 8 some m onies b e l o n g in g to you i n 1 9 7 3 . in f o rm e d y o u r s o l i c i t o r s th at i n c l u d i n g payment t o a G u e rn s e y on b e h a l f o f t h e b a n k , had i n v e s t e d 9 10 What I would l i k e 11 c o n t a c t w it h G u in n e s s & Mahon i t s e l f 12 r e l a t i o n s h i p w it h i t 13 re la tio n s h ip , 14 we c o u l d j u s t go th r o u g h t h e s e a l i t t l e 15 a s k you, 16 r e l a t i o n s h i p w it h G u in n e s s & Mahon, 17 A. f ir s t if to a s k you ab o u t i s , and, s e c o n d ly , firs tly , your and y o u r your a n y , w it h Mr. T r a y n o r h i m s e l f . of a l l , when you f i r s t To th e b e s t o f my r e c o l l e c t i o n b it. If Can I d e v e lo p e d a th e b a n k ? I had a s m a l l a c c o u n t 18 t h e r e and I mean a v e r y s m a l l a c c o u n t , 19 a c c o u n t and I am not e x a c t l y c e r t a i n o f t h i s , 20 so m e th in g t e l l s me i n th e b a c k o f my m ind t h a t I had 21 i n aro u n d ab out th e 1 9 7 0 ' s , 22 42 Q. a d e p o s it 1 9 7 1 or 1 9 7 2 . When you s a y you t h i n k you ha d , d i d you know 23 G u in n e s s & Mahon a t t h a t s t a g e o r d i d you know 24 someone t h e r e ? 25 A. 26 27 28 29 I knew i t but as a r e p u t a b l e bank w e l l t h o u g h t o f i n th e C ity . 43 Q. Why i s there? it t h a t you t h i n k you may have had an a c c o u n t Where was y o u r no rm al b a n k ? 1 44 Q 2 3 What makes you t h i n k t h a t you may have had an a c c o u n t w it h G u in n e s s & Mahon? A It is a v e r y good q u e s t i o n , b u t I am no t r e a l l y 4 c e r t a i n o f th e answer to t h a t q u e s t i o n . 5 f e e l i n g t h a t I had a s m a l l a c c o u n t . 6 45 Q 7 A 8 I have a D id you know Mr. T r a y n o r o f th e b a n k ? I was a t a d i n n e r p a r t y i n a f r i e n d ' s house some t im e b e f o r e t h i s t h i n g happe ne d. 9 46 Q 10 A Sorry, some tim e b e f o r e I made an i n v e s t m e n t . 11 47 Q R ig h t, okay. 12 A W hich t h i n g h appened? T h a t was th e o n l y tim e I e v e r met him . He was n e v e r 13 a f r i e n d o f mine o r an a c q u a i n t a n c e . 14 even c a l l him an a c q u a i n t a n c e , 15 he was an a c q u a i n t a n c e when I got t o know him a t th e 16 bank b u t b e f o r e t h a t I o n l y met him once a t a d i n n e r 17 party. 18 48 Q I w o u ld n 't I sup pose I c o u l d s a y So you met him a t a d i n n e r p a r t y and t h e n you s a y 19 t h a t was j u s t a s h o r t tim e b e f o r e you i n v e s t e d some 20 money? 21 A 22 49 Q 23 A 24 50 Q 25 26 Sorry, if I s a i d a s h o r t tim e ....( IN T E R J E C T IO N ). I t was some t im e ? Yes, no t a v e r y lo n g t im e . T e l l me ab out th e i n v e s t m e n t , what was t h i s in v e s t m e n t ? A Yes, I w ill. My l a t e f a t h e r had h o r s e s w it h V i n c e n t 27 O ' B r i e n who was a famous t r a i n e r , 28 know, t h e b e s t t r a i n e r I r e l a n d e v e r p r o d u c e d . 29 my f a t h e r d i e d , as you p r o b a b l y and I knew him v e r y w e l l , A fte r he s a i d to 1 me, 2 ho rse?' I s a id , 3 would i t be?' 4 So we went to th e s a l e s i n 1 9 7 1 o r 1 9 7 2 and we 5 bo ug ht a y e a r l i n g w hich was s u b s e q u e n t l y c a l l e d 6 M is s C h a m o z zie and t h a t r a n w e l l . 7 fo u r tim e s. 8 and i t 9 s e c o n d t h e n e x t tim e i t 'D e n is, why d o n ' t we have a g e t - t o g e t h e r on a ' I h a v e n ' t a l o t o f money, how much He s a i d , 11 C o le , 12 . . . . ( IN T E R J E C T IO N ) . 14 A 15 52 Q 16 17 ran, I th in k , t im e i t won th e n a t th e C u r r a g h and I t h i n k i t it 51 Q It I t was u n p l a c e d t h e f i r s t 10 13 'a b o u t £ 1 , 4 0 0 o r £ 1 , 5 0 0 . ' won two o t h e r s . ran was r a n a t th e P h o e n ix P a r k and I t was s o l d e v e n t u a l l y t o P a u l one o f t h e E n g l i s h t r a i n e r s for To P a u l ? C o le , C -O -L -E . Yes. So i t was on th e p r o f i t s o f t h i s s a l e t h a t you made . . . . ( I N T E R J E C T I O N ) . A Sorry, I am i n t e r r u p t i n g , £3 3 ,0 0 0 I g o t. T h e re was 18 a t im e , 19 Permanent was - - 20 t h e I r i s h pound was i n t r o u b l e . 21 amount o f money as f a r a s I was c o n c e r n e d b e c a u s e i t 22 was a h o r s e , 23 somebody i n G u in n e s s & Mahon and I was p u t i n t o u c h 24 w it h t h e l a t e Mr. T r a y n o r . 25 53 Q 26 A 27 54 Q 28 29 i f my memory i s t r u e t o me, t h a t I r i s h i n t e r e s t r a t e s were v e r y h i g h and T h i s was a t a x f r e e I th o u g h t t h a t maybe I w ould t a l k to Can you s a y who p u t you i n t o u c h ? I c a n ' t remember r e a l l y . Had you a t t h a t t im e f i n a n c i a l o r l e g a l a d v i s o r s t h a t you m ig h t have c o n s u l t e d ? 1 2 55 Q So i t would have been some m u t u a l f r i e n d who 3 s u g g e s t e d you t a l k t o Mr. T r a y n o r o r t o G u in n e s s & 4 Mahon? 5 A No. I am i n c l i n e d t o do t h i n g s a b i t on t h e s p u r o f 6 t h e moment, 7 t h e moment. 8 from anybody and c e r t a i n l y I got no p r o f e s s i o n a l 9 a d v ic e . 10 56 Q 11 A 12 57 Q I t h i n k I d i d i t m y s e l f on t h e s p u r o f I d o n ' t remember g e t t i n g an y a d v i c e So you c o n t a c t e d Mr. T r a y n o r anyway? Yes, I was p u t i n t o u c h w it h him . When you s a y you were p u t i n t o u c h w it h him . . . . ( IN T E R J E C T IO N ) . 13 14 A 15 58 Q 16 A 17 59 Q 18 A 19 60 Q 20 A My r e c o l l e c t i o n i s somebody i n th e b a n k . You went to t h e ba nk and t h e y p u t you i n t o u c h ? Yes, e x a c tly . What d i d he s a y to you ? It is n e a r l y 30 y e a r s ago. I know, a s b e s t you can remember. He s a i d , 'th is is t a x f r e e money and as t h e pound i s 21 p o s s ib l y in danger of r e d u c in g in v a lu e , 22 be p u t o f f s h o r e . ' 23 61 Q 24 A Yes, 25 62 Q Yes . 26 A o r words t o t h a t e f f e c t . A f t e r some c o n s i d e r a t i o n , and I d i d n ' t c o n s u l t my a c c o u n t a n t s o r an y p r o f e s s i o n a l a d v i s o r s , 28 what happened. 63 Q c o u ld He a c t u a l l y s a i d t h a t ? 27 29 th is that is D id he g i v e you an y more d e t a i l s t h a n t h a t o f what 12 1 would be done w it h i t ? 2 ab o u t a d i s c r e t i o n a r y t r u s t ? 3 A. 4 5 64 Q. I ju s t You may, yes, c e rta in ly . T h e se a r e n o t e s you have j u s t w r it t e n f o r the in t e r v ie w to d ay ? A. 8 9 b u t I c a n ' t remember e x a c t l y w hat. w rote down a few n o t e s , may I lo o k a t them? 6 7 He d i d , D id he t a l k t o you a t a l l Yes, I w rote them t h i s m o r n in g . It d o e s n ' t t o u c h on t h a t p a r t i c u l a r p o i n t you a r e a s k i n g me. 65 Q. Maybe i f I can a s k you some q u e s t i o n s and i f you 10 t h i n k t h a t you have an answ er i n y o u r n o t e s t h e r e , 11 we ca n r e f e r to them t h a t way. 12 t h i n g t h a t way. 13 r e c o l l e c t i o n t h a t he may have m e n tio n e d a 14 d is c r e tio n a r y t r u s t. 15 A. 16 66 Q. 17 A. 19 67 Q. 20 A. 21 68 Q. 22 A. Do you t h i n k t h a t he s u g g e s t e d to you t h a t t h a t A s a f e way. A d is c r e tio n a r y t r u s t. I am no t s u r e what a d i s c r e t i o n a r y t r u s t means. That i s what I was coming t o . D id he e x p l a i n t o you No, and I s t i l l d o n ' t even know. I have a vague id e a . 69 Q. 26 You do not r e c o l l e c t him e x p l a i n i n g t o you i n some d e t a i l what a d i s c r e t i o n a r y t r u s t was? 27 A. 28 70 Q. 29 Yes. what a d i s c r e t i o n a r y t r u s t was? 24 25 You t h i n k you have some vague w ould be a good way o f i n v e s t i n g y o u r money? 18 23 We m ig h t f o c u s t h e No. D id he o f f e r you t h a t a s an a l t e r n a t i v e ? D id he 1 or d i d you g et th e i m p r e s s i o n t h a t what he was g o in g 2 t o do was s e t t i n g up a d i s c r e t i o n a r y t r u s t ? 3 A. I had an i d e a t h a t he was g o in g t o i n v e s t i t as i t 4 was t a x f r e e and d i d n ' t come u n d e r t h e - - 5 d id n 't th in k i t 6 t h a t i t p r o b a b l y would have been a w is e way o f 7 s a f e g u a r d i n g and maybe g e t t i n g a b e t t e r in co m e. 8 7 1 Q. 9 came u n d e r an y r u l e s o r r e g u l a t i o n s , D id he t e l l you where o f f s h o r e he m ig h t t h i n k o f in v e s tin g i t ? 10 A. 11 72 Q. 12 A. 13 73 Q. 14 A. 15 74 Q. 16 A. 17 75 Q. 18 A. 19 76 Q. 20 On th e f i r s t A. 22 77 Q. 23 day? Yes. I d o n ' t know t o be h o n e s t , I d o n ' t remember. D id he a t a l a t e r s t a g e ? O h' y e s . Where d i d he s a y ? G uernsey. In G uernsey? Yes. D id he s a y t o you t h a t i t s u b s id ia rie s 21 24 or I would be w it h one o f th e o f G u in n e s s & Mahon i n G u e r n s e y ? He d i d n ' t . D id he s a y what ba nk o r what i n s t i t u t i o n i t would be in v e s te d in ? A. I d i d n ' t get the im p re s s io n t h a t i t was a s u b s i d i a r y 25 o f G u in n e s s & Mahon b u t t h a t he had a c o n n e c t io n 26 w it h them. 27 78 Q. 28 A. 29 79 Q. D id he s a y where i t was o r what company o r b a n k ? He s a i d C r e d i t S u i s s e . He a c t u a l l y s a i d C r e d i t S u i s s e ? 1 2 80 Q. 3 A. 4 8 1 Q. 5 A. 6 82 Q. 7 A. 8 83 Q. 9 10 We a r e g o in g b a c k now t o what y e a r , 1973, I th in k , or 1974. D id he m e n tio n C o l l e g e T r u s t e e s ? No. He s a i d C r e d i t S u i s s e ? Yes. Was i t d e c i d e d a t t h a t m e e t in g t h a t t h a t was what he would do? A. I m ig h t have w a it e d a few d a y s . 11 f o r me to s a y y e s , 12 remember. 13 ro u g h ly ? 84 Q. 14 I t w ould be e a s y b u t I must a d m it t h a t I c a n ' t I t was e i t h e r th e n or some tim e l a t e r t h a t you made a d e c i s i o n t h a t you would go a lo n g w it h t h i s ? 15 A. 16 85 Q. Yes. D id you th e n t r a n s f e r money to him o r how d i d th e 17 a c t u a l in v e s t m e n t work? 18 or a d r a f t o r w h a t e v e r ? 19 A. 20 86 Q. 21 A. 22 87 Q. D id you g i v e him a cheque I t h i n k I gave t h e cheque t h a t I got m y s e l f . To him ? Yes, a g ain th a t i s That i s t o th e b e s t o f my r e c o l l e c t i o n . a l l we can a s k you to do t o d a y , 23 of your r e c o l l e c t i o n . 24 p r o c e d u r e s were f o l lo w e d i n d o in g t h a t ? 25 s i g n some document o r m an d a te? 26 A. 27 88 Q. 28 29 t o th e b e s t Do you r e c o l l e c t what D id you I d o n ' t remember s i g n i n g an y document. D id you u n d e r s t a n d t h a t t h e money w ould be i n v e s t e d i n y o u r name o r th r o u g h th e name o f some company? 1 89 Q. 2 A. 3 90 Q. 4 A. 5 No. Why d i d you no t t h i n k t h a t ? B e c a u se I t h i n k my u n d e r s t a n d i n g was t h a t i t 91 Q. 7 A. 8 The money would be h e l d f o r you by t r u s t e e s ? Or i n a t r u s t . I was v e r y raw i n t h o s e d a y s , 92 Q. Y ou r u n d e r s t a n d i n g was t h a t t h i s money w ould no t be h e l d i n y o u r name? 11 A. 12 93 Q. 13 T h a t's r ig h t . B ut t h a t b e n e f i c i a l l y i t c o u l d u se i t , 14 A. 15 94 Q. 16 A. 17 95 Q. was y o u r money and you d i d you u n d e r s t a n d t h a t ? I d id . D id Mr. T r a y n o r t e l l you t h a t ? Yes, t h a t was my u n d e r s t a n d i n g . D id you u n d e r s t a n d from Mr. T r a y n o r t h a t a lt h o u g h 18 t h e money would no t be i n y o u r name, 19 w is h e d you c o u l d c a l l upon i t , 20 that? A. Yes, w a sn 't a s h o r t -t e r m , 23 no t a s h o r t - t e r m . 96 Q. Yes, that i f you d i d you u n d e r s t a n d b u t I t h i n k t h e u n d e r s t a n d i n g was t h a t i t 22 24 I d i d n ' t know v e r y much ab o u t t h i s . 10 21 was p o s s ib ly a t r u s t. 6 9 You d i d n o t ? it I understand th a t, was a l o n g - t e r m i n v e s t m e n t , it was no t l i k e o p e n in g an 25 a c c o u n t t h a t you c o u l d w ith d raw money from t h e n e x t 26 d ay i f 27 A. 28 97 Q. 29 No, you wanted i t . e x a c tly . D id you u n d e r s t a n d t h a t you c o u l d i f you w is h e d 1 I sup pose s o , 2 th at. 3 98 Q 4 but i t A 6 99 Q 7 A 8 10 0 Q 9 w a s n ' t my i n t e n t i o n t o do b u t you d i d no t f e e l i t c o u l d not a c c e s s i t 5 at a l l , I d o n ' t want to be awkward, was so t i e d up t h a t you d i d y ou ? I r e a l l y d o n 't t h in k so. I t h i n k you s a i d t h i s was aro u n d 1 9 7 3 ? Yes . You have m e n tio n e d i n y o u r s t a t e m e n t ( E x h i b i t 1) to us h e re on t h e se c o n d page t h i s G u e r n s e y 10 11 Yes, yes, i n c o r p o r a t e d company named C h u n g a . A T h a t's r ig h t , I have a n o te on t h a t . Chunga seems 12 t o be a company i n G u e rn s e y a s s o c i a t e d w it h C r e d i t 13 S u i s s e and t h e r e does no t seem t o be an y i n f o r m a t i o n 14 f o r th e p e r i o d from 1 9 7 3 to 19 7 8 i n r e l a t i o n t o what 15 was h a p p e n in g t h e r e . 16 d e s p i t e my s o l i c i t o r s h a v in g w r i t t e n t o G u in n e s s & 17 Mahon, 18 101 Q T h e re i s no i n f o r m a t i o n G u e r n s e y and C r e d i t S u i s s e . What you a r e t e l l i n g me t h e r e now i s t h a t you have 19 done some r e s e a r c h e s a t t h e moment and you c a n n o t 20 f i n d a n y t h i n g out about i t ? 21 A 22 10 2 Q 23 A 24 103 Q Sorry, T h is i s t h i s was when I r e p o r t e d t h i s t o t h e R evenu e. a ll i n r e c e n t t im e s you a r e t a l k i n g a b o u t ? W i t h i n t h e l a s t two y e a r s . What I am r e a l l y a s k i n g you i s d i d you do a n y t h in g 25 ab o u t Chunga a t t h a t t i m e ? 26 Mr. T r a y n o r had m e n tio n e d to you i n c o n n e c t i o n w it h 27 y o u r in v e s t m e n t ? 28 29 A No. Was i t a name 1 2 1 0 5 Q. 3 4 A. I d o n ' t know, I d o n ' t want t o i n an y way s a y a n y th in g th a t i s 10 6 Q. 7 L e t me p u t i t is 8 A. 9 1 0 7 Q. Yes, a n o t h e r way; a r e you happy t h a t Chunga I t h in k so, yes. D id you o v e r th e y e a r s - how lo n g t h i s 11 s t ill A. not what I know f o r 1 0 0 % . a company c o n n e c t e d w it h y o u r i n v e s t m e n t ? 10 12 tim e you h e a r d o f Chunga when G u in n e s s & Mahon c o n t a c t e d you o r had you known ab o u t i t ? 5 6 I s the f i r s t sorry, I s h o u ld a s k you in v e s t m e n t c o n t in u e d f o r o r i s it i n e x i s t e n c e o r what happened t o i t ? When th e s e t t l e m e n t o r when we p r o c e e d e d t o make a 13 s e t t l e m e n t w it h th e R evenu e, 14 t o a company c a l l e d G arenn e T r u s t and t h e i r o n l y 15 a s s e t was a lo a n o f a p p r o x i m a t e l y £ 1 3 8 , 0 0 0 . 16 108 Q. 17 Sorry, when you s a y t h e money had gone t o a company c a l l e d G arenn e T r u s t ? 18 A. 19 10 9 Q. 20 I t was a lo a n t o G arenne T r u s t . When d i d a l l t h i s ha p p e n? w it h t h e R evenu e, 21 A. 22 1 1 0 Q. 24 G uernsey? A. 26 1 1 1 Q. 27 29 was i t ? Maybe we c o u l d f o l l o w t h e h i s t o r y a l i t t l e it. 25 B e f o r e th e s e t t l e m e n t O h' y e s . 23 28 th e money had gone th e n b i t of T h i s money was i n v e s t e d by Mr. T r a y n o r i n Yes. Then you s a y i t went t o a company c a l l e d Garenne T ru st? A. No, sorry, I may be m i s l e a d i n g you t h e r e . One 1 d i d n ' t t a k e an y money out o f my p o c k e t s o r my income 2 and throw i t 3 in v e s tm e n t. 4 112 Q 5 Yes, over th e re . I understand. I j u s t had one s i n g l e Mr. T r a y n o r i n v e s t e d t h a t f o r you i n G u e r n s e y ? 6 A 7 113 Q 8 A 9 114 Q 10 A 11 Yes . W ith C r e d i t S u i s s e , as you u n d e r s t o o d i t ? Yes . And c o n n e c t e d w it h t h a t was t h i s company C hunga? Yes, a p p a re n tly . anyway a t l e a s t , 12 It s a y s h e r e o r my r e c o l l e c t i o n and I t h i n k t h i s is correct; " C h u n g a 's o n l y a s s e t was a l o a n o f a p p r o x i m a t e l y £ 1 3 8 , 0 0 0 to th e Garenne T ru st. T h i s lo a n was f o r g i v e n . " 13 14 15 115 Q 16 Mr. M c C a rth y , you s a y you j o t t e d t h i s down t h i s m o r n in g . 17 A 18 116 Q Yes . Where would you have got a l l t h a t i n f o r m a t i o n from t h i s m o rn in g ? 19 20 A 21 117 Q 22 A 23 118 Q 24 A 25 119 Q From l e t t e r s t h a t were s e n t to th e R e ve n u e. By you ? My s o l i c i t o r s . T he se a r e l e t t e r s r e l a t i n g t o t h i s Yes, If in v e stm e n t? t h e y must b e . t h e y a r e r e l a t i n g to t h i s p a r t i c u l a r in v e s t m e n t 26 and t h i s is 27 here, would be r e l e v a n t t o us t o see t h o s e 28 le tte rs 29 a r e no t c o n c e r n e d w it h o t h e r t a x a f f a i r s it t h e in v e s t m e n t t h a t we a r e l o o k i n g a t i n s o f a r as th e y r e l a t e to t h i s aspe ct. We of yours in 1 2 3 No, 120 Q I have no . . . . ( I N T E R J E C T I O N ) . We a r e not c o n c e r n e d w it h y o u r a f f a i r s and y o u r 4 d i s c u s s i o n s w it h t h e Revenue i n an y way. 5 a r e c o n c e r n e d w it h 6 A 7 121 Q What we . . . . ( I N T E R J E C T IO N ) . My o t h e r t a x a r e a b s o l u t e l y and a lw a y s have b e e n . . . I und erstan d. What we a r e c o n c e r n e d w it h i s any 8 d o c u m e n t a t io n you m ig h t have i n r e l a t i o n t o t h i s 9 in v e s t m e n t you made th r o u g h Mr. T r a y n o r w hich 10 r e s u l t e d i n what a p p e a r s to be th e s e t t i n g up o f a 11 Tru st. 12 what happened t o t h e i n v e s t m e n t . 13 I am no t s u r e . 14 MS. MACKEY: C e r t a i n l y you may, y e s . 15 MR. O'GRADY: May we go o u t s i d e ? 16 MS. MACKEY: C e rta in ly . I f you have documents t h a t a c t u a l l y show May I t a l k t o my s o l i c i t o r ? 17 18 19 (SHORT BREAK) 20 21 MR. O'GRADY: Mr. M c C a r t h y 's v ie w on 22 i n s t r u c t i o n s t o us would 23 be t h a t th e d o c u m e n ta t io n i n r e l a t i o n t o t h i s 24 in v e s t m e n t on a d v i c e from us d i d no t come w i t h i n t h e 25 am b it o f S c h e d u le C o r A p p e n d ix C t o y o u r l e t t e r . 26 If 27 e v e r y t h i n g i n th e s t a t e m e n t o r an y c o n n e c t i o n t h a t 28 he i s 29 in v e stm e n t, you a r e s a y i n g t h a t i t is r e l e v a n t and he s e t out aware o f between t h e company and h i s if you a r e s a y i n g t o us t h a t t h a t 1 d o c u m e n ta tio n i s 2 happy t o p r o v i d e t h a t . 3 MS. MACKEY: re le v a n t, we w i l l o f c o u r s e be T h a t i s what we a r e s a y i n g 4 and i n f a c t I am g o in g to 5 a s k Mr. M c C a rth y t o lo o k a t some G u in n e s s & Mahon 6 s t a t e m e n t s now o f th e a c c o u n t o f G u in n e s s Mahon 7 Cayman T r u s t w h ich i s A n s b a c h e r show ing t r a n s a c t i o n s 8 i n r e l a t i o n to C h u n g a . 9 MR. O'GRADY: C o u ld I s a y f i n a l l y o r 10 s u b m it as my f i n a l i n p u t 11 t h a t we have r e q u e s t e d c o p i e s o f t h a t d o c u m e n ta tio n 12 from G u in n e s s & Mahon and a s o f t o d a y we have not 13 re ce iv e d i t . 14 15 A. That i s in the statem e n t, MS. MACKEY: is n 't Yes, 16 it? it is , Mr. M c C a rth y . On t h e b a s i s o f t h i s and 17 what I am now g o in g to show Mr. M c C a rth y , 18 t h a t t h i s d o c u m e n ta t io n would be r e l e v a n t t o us 19 . . . . ( IN T E R J E C T IO N ) . 20 MR. O'GRADY: 21 . . . . ( IN T E R J E C T IO N ) . 22 MS. MACKEY: And comes w i t h i n t h e am b it Comes w i t h i n t h e am b it 23 because i t 24 w it h A n s b a c h e r and, 25 Ansbacher i s 26 Mr. M c C a rth y h a s e x p l a i n e d t o u s , 27 c o n n e c t e d w it h th e i n v e s t m e n t , 28 e n t i t l e d to l o o k a t t h e i n v e s t m e n t . 29 we s a y the refo re , c o n n e c t s Chunga an y i n v e s t i g a t i o n o f e n t i t l e d t o l o o k i n t o Chunga w h ic h , is a company t h e r e f o r e we a r e as 1 d i d no t know p r e c i s e l y 2 what th e c o n n e c t i o n between them was. 3 MS. MACKEY: I understand t h a t . 4 is f i n e and i t That was not 5 c le a r, 6 t o Mr. M c C a rth y u n t i l we began t o t e a s e t h e t h i n g 7 o ut now w it h you what t h e c o n n e c t i o n e x a c t l y was. 8 A. 9 to any o f u s , The o n l y t h i n g i s e i t h e r to o u r s e lv e s or I n e v e r had a n y t h i n g t o do w it h t h e r u n n in g o f C h u n g a . 10 11 I th in k , A ll I know i s t h a t th e i n v e s t m e n t was made o r a p p e a re d t o have been made. 1 2 2 Q. That i s th e p o i n t and I t h i n k you have e x p l a i n e d 12 t h a t t o us when you s a y t h a t i n f a c t t h e a c c o u n t was 13 no t i n y o u r name o r th e T r u s t was no t i n y o u r name 14 and t h a t e x p l a i n s why you had n o t h in g t o do w it h th e 15 r u n n in g o f i t . 16 a f t e r a l l t h a t and i t 17 t h r o u g h Chunga o r i n c o n n e c t io n w it h Chunga. Mr. T r a y n o r , p r e s u m a b ly , was done, it lo o k e d w ould a p p e a r , 18 19 Anyway, 20 h e re t o have a l o o k a t . 21 (E x h ib it 2 ) . (SAME HANDED). 22 Mr. M c C a rth y , i s s u e d by G u in n e s s & Mahon i n D u b l i n 23 and i t 24 w it h them. 25 G M C T /C o lle g e S u n d ry S u b - A c c o u n t . 26 you what t h a t a c t u a l l y i s . 27 D u b l i n t h e r e was a t t h a t t im e , 28 was a t t h a t p e r i o d an a c c o u n t i n t h e name o f GMCT 29 w h ic h i s if is I m ig h t j u s t p a s s you a document o r two F i r s t of a l l , T h is i s page 28 a statem ent, a s t a t e m e n t o f an a c c o u n t t h a t was h e l d You w i l l see t h e name a t t h e t o p , it is I w i l l e x p l a i n to I n G u in n e s s & Mahon i n th at i s G u in n e s s Mahon Cayman T r u s t , 1982, th e re and t h a t i s 1 t h e fo rm er name o f A n s b a c h e r , 2 in v e s tig a tin g . 3 G u in n e s s Mahon Cayman T r u s t w it h a r e f e r e n c e C o l l e g e 4 or C o lle g e T r u s te e s , 5 and what i t 6 C o l l e g e T r u s t e e s i n G u e r n s e y p l a c e d money o f I r i s h 7 in v e s t o r s in t o A nsbacher, 8 T r u s t and t h a t money was h e l d i n G u in n e s s & Mahon i n 9 D u b l i n i n t h i s p a r t i c u l a r a c c o u n t and t r a n s a c t i o n s th e company we a r e now The a c c o u n t was i n t h e name o f as you se e t h e r e G M C T /C o lle g e was was a s u b s i d i a r y o f G u in n e s s & Mahon i n t o G u in n e s s Mahon Cayman 10 r e l a t i n g t o t h a t money p a s s e d th r o u g h t h i s 11 p a r t ic u la r account. 12 t h e p o o le d money o f numerous i n v e s t o r s , 13 i n v e s t o r s who had money i n th e C h a n n e l I s l a n d s w it h 14 C o l l e g e T r u s t e e s o f whom C r e d i t S u i s s e i s 15 company i n f a c t . 16 P a r t i c u l a r s you w i l l see th e d a t e o f 2 0 t h December 17 19 8 2 and you see Re Chunga, 18 Mr. M c C a rth y ? 19 A. 20 1 2 3 Q. The a c c o u n t i n t o t a l c o m p ris e d Ir is h the p a re n t I f you se e t h e r e i n th e do you see t h a t t h e r e , Yes. You see a c r e d i t o f £ 1 , 0 0 0 . T h a t shows t h a t th e 21 company we have been t a l k i n g a b o u t , 22 money o r money was lo d g e d on b e h a l f o r Re Chunga to 23 th is 24 a c c o u n t i n G u in n e s s & Mahon. 25 y o u r Chunga and y o u r in v e s t m e n t w it h A n s b a c h e r and 26 t h a t i s why we a r e t a l k i n g t o you t o d a y . 27 a p p e a r to have happened i s 28 i n v e s t e d y o u r money i n G u e r n s e y w it h C r e d i t S u i s s e 29 o f w h ic h C o l l e g e T r u s t e e s i s a c c o u n t w h ich i s Chunga, lo d g e d the A n s b a c h e r /C o lle g e T r u s te e s That i s how we l i n k What would t h a t Mr. T r a y n o r h a v in g a su b sid ia ry , C o lle g e 1 T r u s t e e s i n t u r n p l a c e d y o u r money a lo n g w it h a l o t 2 o f o t h e r p e o p l e s ' money w it h A n s b a c h e r w h ic h a t t h a t 3 t im e was c a l l e d G u in n e s s Mahon Cayman T r u s t who i n 4 tu rn p la c e d i t 5 o f them, 6 G u in n e s s & Mahon, 7 t h e r e w it h a c r e d i t . 8 t h a t was lo d g e d i n c o n n e c t io n w it h Chunga o r p e r h a p s 9 t h r o u g h th e T r u s t , i n t h i s a c c o u n t i n th e name o f b o th G u in n e s s Mahon Cayman T r u s t and C o l l e g e i n and so we se e Chunga a p p e a r in g T h a t would a p p e a r t o be money it is no t v e r y c l e a r , b u t you can 10 see from t h a t t h a t a t r a n s a c t i o n r e l a t i n g t o Chunga 11 has p a s s e d th r o u g h t h i s G u in n e s s Mahon Cayman 12 T r u s t/C o lle g e account. 13 t h a t document t o be th e c a s e ? 14 A. 15 12 4 Q. Does t h a t no t a p p e a r from I have n e v e r seen t h a t . I understand t h a t . You may keep t h i s document, it 16 is 17 w i l l f u r n i s h to you when t h e y f i n a l l y g e t aro u n d to 18 f u r n i s h i n g you w it h th e documents you have a s k e d 19 them f o r . 20 A. 21 22 one o f t h e o n e s , p r e s u m a b ly , I n an y v a l u a t i o n s t h a t I g o t , G u in n e s s & Mahon t h a t d i d n ' t come i n t o it . 1 2 5 Q. It is i n the l i g h t o f t h a t t h a t we do c o n s i d e r t h a t 23 t h e documents f o r w hich you drew up y o u r n o t e s t h i s 24 m o rn in g would be r e l e v a n t to o u r e n q u i r i e s and we 25 w ould a s k you i f 26 t h a t we c o u l d 27 A. 28 1 2 6 Q. 29 you would f u r n i s h t h o s e t o us so ....(IN T E R J E C T IO N ). The ones to t h e R e ve nu e? L e t me p u t i t t h i s way Mr. M c C a rth y , w h a te v e r t h e 1 drew up f o r t h e i n t e r v i e w h e r e t o d a y , 2 have been r e a d i n g t o us from, 3 i n f o r m a t i o n t h a t you p u t i n t o t h o s e n o t e s would be 4 r e le v a n t to u s. 5 A. 6 1 2 7 Q. 7 t h e ones you w h erever you got th e They came f r o m . . . If you would f u r n i s h t h o s e to u s , we w ould be g ra te fu l. 8 A. 9 12 8 Q. A copy? Yes, a copy, of course. A n y t h i n g you have i n 10 r e l a t i o n t o Chunga o r i n r e l a t i o n t o t h e in v e s t m e n t 11 t h a t Mr. T r a y n o r made f o r you o r i n r e l a t i o n t o t h i s 12 Trust - - what d i d you c a l l i t 13 A. 14 1 2 9 Q. 15 A. I th in k i t 16 1 3 0 Q. Thank you. a g a in ? Garenne. How do you s p e l l t h a t ? is G -A -R -E -N -N -E . A n y t h i n g you have i n r e l a t i o n t o t h o s e 17 would be o f r e l e v a n c e to us and we w ould a s k you i f 18 you would f u r n i s h them t o u s . 19 A. 20 1 3 1 Q. Yes. T h a t would be g r a n d . Mr. M c C a rth y , 21 little d i d Mr. T r a y n o r g i v e you any 22 code o r r e f e r e n c e f o r y o u r a c c o u n t ? 23 m e n tio n t o you "B /G " as b e in g a code o r r e f e r e n c e ? 24 A. 25 1 3 2 Q. 26 A. 27 1 3 3 Q. b it from t h a t , j u s t moving on a D id he e v e r No. He n e v e r d i d ? Not t o my r e c o l l e c t i o n . Okay. I n th e c o u r s e o f th e y e a r s up t o t h e tim e 28 t h a t you c o n c lu d e d y o u r t r a n s a c t i o n s w it h t h e 29 Revenue - - sorry, d i d you th e n c l o s e t h i s T r u s t or 1 2 3 Yes . 134 Q 4 You went and c l o s e d i t down, you i n s t r u c t e d Mr. T r a y n o r t o c l o s e i t , 5 A 6 135 Q 7 A 8 136 Q 9 A 10 137 Q 11 A 12 13 8 Q 13 A 14 139 Q 15 A 16 140 Q 17 d i d y ou ? He was lo n g d ead . Was i t Mr. C o l l e r y t h e n ? How d i d you c l o s e i t down? D i r e c t l y w it h G u e r n s e y . Who d i d you s p e a k to t h e r e ? (P a u s e ) . Was i t a Mr. E l l i s ? I t p r o b a b l y was. B ria n E l l i s ? T h e re was a n o t h e r man, Woodward. C h r i s t o p h e r Woodward? No, I d o n 't t h in k i t was C h r i s t o p h e r . I t may have been Mr. Woodward o r i t may have been Mr. E l l i s ? 18 A 19 14 1 Q 20 Yes . Had you had c o n t a c t w it h Mr. E l l i s , does t h a t name r i n g a b e l l w it h you ? 21 A 22 14 2 Q 23 A 24 143 Q 25 Yes . B ria n E l l i s ? Yes, b u t no t v e r y much. He w ould be one o f th e o f f i c i a l s in fa c t, 26 A 27 144 Q in C o lle g e T ru ste e s B ria n E l l i s . I d i d n ' t know t h a t . Over th e y e a r s d i d you have c o n t a c t d i r e c t l y w it h 28 t h e s e p e o p le a t a l l 29 t r a n s a c t i o n s d i d you go th r o u g h Mr. T r a y n o r ? s t a g e s f o r i n f o r m a t i o n and 1 2 1 4 5 Q. 3 F o r a n y t h i n g you wanted to do i n r e l a t i o n t o y o u r Tru st, 4 A. 5 14 6 Q. 6 A. 7 1 4 7 Q. 8 A. 9 No, e it h e r in fo rm a tio n or t r a n s a c t io n s ? I would g e t v a l u a t i o n s from tim e t o t im e . You mean s t a t e m e n t s o f t h e b a l a n c e s ? Yes. Where would you g e t t h o s e from ? I n G u in n e s s & Mahon o r maybe som etim es s e n t d ir e c tly . 10 148 Q. From G u e r n s e y ? 11 A. I am no t s u r e . 12 14 9 Q. 13 A. Do you have an y c o p i e s o f t h o s e s t i l l ? No. F i v e y e a r s ago we had a house i n Temple 14 Gardens, 15 y e a r s ago a p p r o x im a t e l y we s o l d t h a t house and moved 16 t o an a p a rtm e n t i n B a l l s b r i d g e . 17 d e c i d e d t h a t she w o u ld n 't be a b l e t o t a k e a l l th e 18 paperw ork w h ich was a huge amount o f paperw ork 19 b e c a u s e o f my in v o lv e m e n t i n v a r i o u s b u s i n e s s e s , 20 some o f them I d i d n ' t even m e n tio n t o yo u . 21 n o t h in g v e r y s i n i s t e r ab o u t an y o f them. 22 1 5 0 Q. 23 A. 24 I have s e v e n c h i l d r e n , a b i g house and f i v e My w i f e , Rhona, T h e re i s No, no. So she s a i d t h a t she would have t o g e t them - is what th e word? 25 1 5 1 Q. S h re d d e d ? 26 A. S h re d d e d , 27 1 5 2 Q. 28 A. 29 1 5 3 Q. yes. So a number o f t h e s e documents got s h r e d d e d , Yes, but t h i s I understand. is lo n g b e f o r e a n y t h i n g l i k e is it? th is. T h a t e x p l a i n s why you have not got 1 th e d o cu m en ts. 2 t im e t o t im e , 3 G u in n e s s & Mahon, was i t 4 them t o y o u ? 5 A. 6 7 154 Q. A. 1 5 5 Q. 12 A. 13 1 5 6 Q. Not v e r y r e g u l a r l y . I c a n ' t remember t o be Was i t j u s t on y o u r r e q u e s t g e n e r a l l y ? B e in g th e k in d o f p e r s o n t h a t I am i t was p r o b a b l y b u t I am no t c e r t a i n . Would th e s t a t e m e n t s s i m p l y i n d i c a t e t o you th e b a la n c e of your t r a n s a c t i o n s ? 16 A. 17 1 5 7 Q. 18 A. 19 15 8 Q. No, it would g i v e f u l l d e t a i l s . Were t h e y headed i n some way? C r e d i t S u i s s e a s f a r as I know. You do not have an y c o p i e s . D id t h e y show i n t e r e s t a c c u m u l a t i n g on t h e b a l a n c e ? 20 21 A. 22 1 5 9 Q. 23 A. 24 16 0 Q. 25 D id t h e y show i n t e r e s t ? Yes. I d o n ' t u n d e r s t a n d what you mean by t h a t . D id i n t e r e s t a c c u m u la t e on th e b a l a n c e and d i d t h e sum o f i n t e r e s t a p p e a r on th e s t a t e m e n t s ? A. 27 29 T h e re were Would you go i n and a s k f o r a s t a t e m e n t o r were on my r e q u e s t , 15 28 I d i d n ' t se e Mr. T r a y n o r t h a t o f t e n . p e r f e c t l y h o n e s t w it h you. 11 26 Mr. T r a y n o r who would g i v e th e se is s u e d r e g u l a r l y to you? 10 14 you s a y you som etim es got them i n v a r i o u s p e o p le i n t h e r e . 8 9 The s t a t e m e n t s t h a t you got from Some o f th e in v e s t m e n t s were i n e q u i t i e s , there w o u ld n ' t be an y q u e s t i o n o f i n t e r e s t . 1 6 1 Q. So we a r e no t t a l k i n g ab o u t s t a t e m e n t s show ing a 1 2 1 6 2 Q. 3 A. 4 1 6 3 Q. 5 6 We a r e ? Yes. T h a t was t h a t on d e p o s i t ? Was t h a t a c c r u i n g in te re s t? A. No, as f a r a s my r e c o l l e c t i o n g o e s , 7 b e in g a c c u r a t e , 8 in v e s t m e n t s . 9 164 Q. 10 A. 11 1 6 5 Q. I n o t h e r w ords, Yes, and I hope I am t h e y came i n t h e form o f show ing th e showing s h a r e s i n e q u i t i e s ? o r maybe i n g i l t s . Was t h e e n t i r e o f y o u r o r i g i n a l in v e s t m e n t d i s p e r s e d 12 i n t h e p u r c h a s e o f s h a r e s and e q u i t i e s i n g i l t s 13 was some o f i t 14 f i x e d d e p o s i t t h a t mounted u p ? 15 A. 16 1 6 6 Q. 17 A. 18 1 6 7 Q. on d e p o s i t i t s e l f i n some k in d o f I d o n 't t h in k so. None o f i t ? B ut I d o n ' t know. So you do no t know th e n w heth er i n t e r e s t a c c r u e d on 19 y o u r o r i g i n a l in v e s t m e n t o r n o t , 20 an y sum o f i t 21 in te re s t, 22 A. or No, b u t i f w heth er t h e r e was i n money t h a t m ig h t have e a rn e d do y o u ? Goodbodys f o ll o w e d th e example o f what 23 was h a p p e n in g w it h th e p r e v i o u s p e o p le l o o k i n g a f t e r 24 it, 25 i n s h a r e s and i n g i l t s . 26 168 Q. 27 a f t e r my i n v e s t m e n t , it p r o b a b l y w ould have been A re we t a l k i n g ab o u t y o u r o r i g i n a l in v e s t m e n t t h a t you made th r o u g h Mr. T r a y n o r ? 28 A. 29 1 6 9 Q. Yes. How d i d Goodbodys come i n t o t h i s ? 1 2 1 9 9 1 I would s a y o r i t 3 the o th e r, 4 170 Q 5 A c o u l d be a y e a r one way o r th e y d e cid e d . . . . ( IN T E R J E C T IO N ) . Who d e c i d e d ? C r e d it S u is s e , maybe b e c a u s e o f bad p e rf o rm a n c e t h a t 6 t h e y would g i v e t h e p o r t f o l i o 7 word t o u s e ? 8 171 Q 9 A 10 172 Q 11 -- is R ig h t. To G o o d b o d y s. P r i o r t o t h a t from 1 9 7 3 to 1 9 9 1 , however, A 13 173 Q 14 No. So what was h a p p e n in g t o y o u r o r i g i n a l in v e s t m e n t d u rin g th a t p e rio d ? 15 A 16 17 4 Q Sorry? What was h a p p e n in g to y o u r o r i g i n a l in v e s t m e n t 17 d u rin g th a t p e rio d ? 18 money o r what was h a p p e n in g to i t ? 19 A 20 175 Q 21 I th o u g h t i t From 1 9 7 3 to 1 9 9 1 where was t h e was o v e r i n . . . What d i d you t h i n k i t was d o in g t h e r e ? A I th o u g h t i t was b e in g i n v e s t e d w h ic h i t was b e c a u s e I was g e t t i n g some a c c o u n t s show ing th e i n v e s t m e n t . 24 176 Q 25 A T he se were a g a i n p u r c h a s e o f e q u i t i e s and g i l t s ? Yes, I th in k , if I remember c o r r e c t l y , 26 p o s s i b l e t h e y m ig h t have p u t some o f i t 27 G uernsey. 29 Was i t s i m p l y m ou n tin g u p? 23 28 Goodbodys d i d no t have t h e p o r t f o l i o ? 12 22 that a s u ita b le 177 Q it is in to 1 I d o n 't t h in k so. 2 so. 3 178 Q I d o n ' t know, b u t I d o n ' t t h i n k D u r in g th e c o u r s e o f a l l t h o s e y e a r s d i d you 4 w ith d ra w an y o f y o u r o r i g i n a l in v e s t m e n t o r u se i t 5 i n an y way and have i t 6 A 7 179 Q 8 A 9 18 0 Q 10 A 11 181 Q 12 A 13 18 2 Q 14 A 15 183 Q 16 A 17 184 Q 18 A 19 185 Q 20 A 21 tran sfe rred ? Yes . You d i d ? Yes . How d i d you go ab o u t t h a t ? May I have a l o o k a t my n o t e s ? Yes . Lo a n s were made t o me a t a l a t e r d a t e . Lo a n s ? Yes, t h e y c a l l them l o a n s . Who c a l l e d them l o a n s , C re d it S u is s e ? Yes . Can you t e l l me ab o u t t h o s e and how t h a t h appened? How I got them? Yes, If what you d i d i f you wanted one. I wanted one i n th e G u in n e s s & Mahon tim e I would have t o r i n g up G u e r n s e y . 22 18 6 Q 23 A 24 187 Q 25 A From G u in n e s s & Mahon. 26 188 Q Do you remember who i t 27 A 28 18 9 Q 29 A You would r i n g who? I w ould r i n g somebody i n G u e r n s e y . Where would you have got t h e i r phone number from ? was you would phone? D if f e r e n t p e o p le . Do you not r e c o l l e c t any p a r t i c u l a r name? 1 2 19 0 Q 3 A What would you s a y ? I w ould s a y - - w e ll, it u s u a l l y happened aroun d 4 C h r i s t m a s t im e , 5 f a r as I know, 6 t h a t I wanted X amount o f money f o r w h a t e v e r . 7 191 Q 8 A 9 192 Q 10 A 11 12 is o n ly i n the l a t t e r , i n th e l a t t e r p e r i o d . as I would s a y And t h e y would . . . . ( I N T E R J E C T I O N ) . They would t e l l me where to c o l l e c t i t . Where would you c o l l e c t i t ? I n t h e G u in n e s s & Mahon tim e i t was i n G u in n e s s & Mahon. 193 Q 13 You would go i n t h e r e and i t would be a v a i l a b l e for you t h e r e ? 14 A 15 194 Q 16 Yes . When you s a y t h e y c a l l e d them l o a n s , d i d you have to repay th e se ? 17 A 18 195 Q 19 A 20 No. So as f a r as you were c o n c e r n e d . . . . ( IN T E R J E C T IO N ) . I o n l y d i s c o v e r e d t h a t t h e y c a l l e d them l o a n s o n l y re c e n tly . 21 196 Q 22 A 23 197 Q 24 A 25 198 Q 26 Where d i d you d i s c o v e r t h i s r e c e n t l y ? I th in k i t was th r o u g h o u r s o l i c i t o r s . Through y o u r s o l i c i t o r s ? I t h in k so, yes. Would t h i s be th r o u g h d o c u m e n ta tio n t h a t you re fe rre d to? 27 A 28 199 Q 29 but t h i s P o s s ib ly . So a l l t h i s d o c u m e n t a t io n s h o u ld show us a l l o f th is , sh o u ld i t ? 1 2 200 Q I s t h e r e d o c u m e n t a tio n a t th e moment i n th e p r e s e n c e 3 of your s o l i c i t o r s 4 and t o t h i s T r u s t g e n e r a l l y ? 5 A 6 201 Q 7 A 8 202 Q 9 11 T h a t you w i l l be g i v i n g u s ? I w i l l g i v e you an y more t h a t I ca n remember. You w i l l a c t u a l l y g i v e us c o p i e s o f t h e no t j u s t n o t e s t h a t you have made from them? A 12 13 Not an y more th a n I am g i v i n g you now. d o c u m e n t a t io n , 10 t h a t r e l a t e s t o t h e s e w it h d r a w a ls What do you mean by c o p i e s o f th e d o c u m e n t a t io n , sorry? 203 Q As I u n d e r s t a n d i t from what you have s a i d to us 14 t o d a y and e s p e c i a l l y s i n c e you came b a c k from th e 15 b r i e f c o n s u l t a t i o n w it h y o u r s o l i c i t o r , 16 n o t e s t h e r e t h a t you made t h i s m o rn in g i n 17 p r e p a r a tio n fo r t h i s 18 from documents e i t h e r i n y o u r p o s s e s s i o n o r i n t h e 19 p o s s e s s io n of your s o l i c i t o r ? 20 A fo r in s ta n c e , 22 here. 23 204 Q 24 A 25 205 Q statem ent, and some n o t e s made from y o u r document Our l e t t e r ? Yes . You were r e a d i n g out to me t h e r e e a r l i e r , 26 Mr. M c C a rth y , 27 t h o s e d ocu m en ts, 28 t h e G arenn e T r u s t . 29 i n t e r v i e w and you made t h o s e No, t h e r e a r e some n o t e s made from t h i s 21 you have in fo rm a tio n th a t i s no t i n e i t h e r o f t h a t was i n f o r m a t i o n i n r e l a t i o n to 1 206 Q I a s k e d you where you got t h a t and you s a i d you had 2 some documents t h a t you got t h a t i n f o r m a t i o n from, 3 d i d I m is u n d e r s t a n d y ou ? 4 A Docum ents, I d o n ' t know i f 5 maybe t h e y a r e docum en ts, 6 ' docum ents'. 7 207 Q I n o t h e r w ords, you c a l l them docum en ts, u n d e r t h e b r o a d word o f you have t h a t i n f o r m a t i o n somewhere 8 e l s e o t h e r t h a n on t h a t b i t o f p a p e r t h e r e t o d a y ; 9 that rig h t? 10 A 11 208 Q I t h in k so. As I u n d e r s t a n d from what y o u r s o l i c i t o r s a i d when 12 you came b a c k i n t o th e room, you a r e p r e p a r e d to 13 make t h a t a v a i l a b l e t o us i f we c o n s i d e r i t 14 and we do c o n s i d e r i t 15 A 16 209 Q 17 A 18 210 Q 20 A 21 211 Q 22 A 23 212 Q re le v a n t re le v a n t? Yes . So you w i l l make t h a t a v a i l a b l e ? Yes . G ra n d , that i s Mr. M c C a rth y , 19 Sorry, c le a r. J u s t one o t h e r q u e s t i o n , and th e n I am f i n i s h e d . I d o n ' t want t o i n t e r r u p t you. Go ah ead . You d o n ' t want me t o s a y anymore ab o u t G oodbodys? I d o n 't t h in k so, no. That i s a lr ig h t, t h a n k you. 24 One o t h e r q u e s t i o n I want t o a s k you, 25 e x p l a i n e d t o us ab o u t t h e w it h d r a w a ls and what I 26 want t o a s k you i s 27 in v e s t m e n t make any a d d i t i o n s t o t h e f u n d , 28 f u r t h e r lo d g m e n t s ? 29 is you have d i d you a f t e r t h e f i r s t any 1 2 no f u r t h e r q u e s t i o n s , 3 Mr. M c C a rth y , 4 have some q u e s t i o n s . t h a n k you v e r y much. Mr. Rowan may 5 MR. ROWAN: 6 Mr. M c C a rt h y , 7 f a i r l y e a rly on i n t h e i n t e r v i e w you 8 m e n tio n e d t h a t y o u r i n i t i a l 9 was made by Mr. T r a y n o r and i t 10 in v e s t m e n t w it h G u e rn s e y was th e p r o c e e d s o f th e s a l e o f th e h o r s e . 11 A 12 2 14 Q 13 H a l f th e p r o c e e d s . So h a l f t h e p r o c e e d s I t h i n k you i n d i c a t e d r e p r e s e n t e d ab out £ 3 3 , 0 0 0 ? 14 A 15 215 Q Yes . A little l a t e r you i n d i c a t e d to us t h a t C h u n g a ' s 16 o n ly a s s e t , 17 lo a n e d to th e G arenne T r u s t and I t h i n k you r e f e r r e d 18 to i t 19 A I t h i n k was th e way you p u t i t , was as £ 1 3 8 , 0 0 0 . I have a n o te h e r e th e o n l y a s s e t a p p e a re d t o be a 20 l o a n o f a p p r o x i m a t e l y £ 1 3 8 , 0 0 0 t o th e G arenn e T r u s t 21 and t h a t was done w it h o u t my knowledge or 22 in itia tiv e . 23 216 Q I t h i n k my q u e s t i o n has to be how d i d £ 3 3 , 0 0 0 g e t to 24 be £ 1 3 8 , 0 0 0 i f 25 d e p o s its , 26 A 27 217 Q 28 A 29 you d i d no t make an y f u r t h e r as you i n d i c a t e d t o Ms. M ackey? I t h i n k t h e r e was more i n Chunga t h a n my £ 3 3 , 0 0 0 . Can you g i v e me some e x p l a n a t i o n o f t h a t ? I d o n ' t know. I have sworn and I w i l l swear a g a i n t h a t I n e v e r gave a n o t h e r p e n n y , I cannot e x p la in i t 1 t o you and I m ig h t have g o t i t 2 c e r t a i n l y n e v e r gave one s h i l l i n g 3 f o r in v e s t m e n t t o G u e r n s e y o r t o G u in n e s s & Mahon. 4 I 5 218 Q. o r one penny e x t r a c a n 't e x p la in i t . P r e s u m a b ly , Mr. M c C a rth y , y o u r in v e s t m e n t was g ro w in g i n v a l u e o v e r a number o f y e a r s ? 6 7 A. 8 219 Q. I w ould s a y s o . So i t w ould have been e x p e c t e d t o h a v e s e e n an in c r e a s e th e re fo re in the v a lu e of i t 9 and t h a t m ig h t be a p a r t i a l e x p l a n a t i o n ? 10 11 A. 12 220 Q . Yes. Were t h e r e an y o t h e r p e o p le i n v o l v e d i n Chunga o t h e r than y o u r s e lf ? 13 14 a l l baw w ays, b u t I A, . I d o n ' t know, Chunga h a s o n l y be en com ing i n t o my 15 m in d i n v e r y r e c e n t t i m e s . 16 s tu p id ly , 17 t a k i n g c a r e o f th e £ 3 3 , 0 0 0 t h a t was i n v e s t e d and 18 Chunga i s 19 I d o n ' t know o f anybody t h a t h a s an y money i n Chunga 20 except m y s e lf, 21 know. 22 2 2 1 Q. I t h o u g h t , maybe v e r y t h a t C r e d i t S u i s s e h ad an a c c o u n t f o r me a name t h a t h a s b e e n h a u n t i n g my m in d b u t b u t t h e r e may h a v e b e e n , I d o n 't The document from w h ic h you were a b l e t o a s c e r t a i n 23 t h a t £ 1 3 8 , 0 0 0 , may we p l e a s e h a v e a co p y o f t h a t 24 document s p e c i f i c a l l y ? 25 A. 26 I am v e r y s t u p i d now and I s h o u l d be a b l e t o t e l l you where i t 27 2 2 2 Q. 28 A. 29 2 2 3 Q. came from, b u t I am s u r e i t is th ere. May we p l e a s e have a co p y o f i t ? Yes. T h a n k yo u . You e x p l a i n e d t o u s t h a t i n t h e e a r l y 36 1 1 9 9 0 ' s C r e d i t S u i s s e became d i s e n c h a n t e d w it h t h e 2 management o f y o u r p o r t f o l i o o f in v e s t m e n t s , 3 d is e n c h a n te d , 4 managed and moved to G o o d b o d y s. 5 May I comment on t h a t ? 6 224 Q 7 A p r e s u m a b ly , w it h th e way i t was b e in g Yes . I d id n 't say, w it h th e g r e a t e s t o f r e s p e c t t o you, 8 t h a t t h e y had become d i s e n c h a n t e d , 9 an e x p l a n a t i o n , it is but i t c o u l d be a p o s s ib le e x p la n a tio n but 10 t h e y d i d n ' t t e l l me t h e y were d o in g i t 11 done and t h e y n e v e r came t o me and s a i d , 12 no t d o in g v e r y w e l l , 13 We have gone to G o o d b o d y s .' 14 Goodbodys w it h o u t t e l l i n g me, b u t I d o n ' t remember 15 them s a y i n g , 16 afte r p r o p e rly .' 17 move, 18 resp ect, 19 s e l l i n g them. 20 225 Q lik e u n til it was 'th e y are we b e t t e r go somewhere e l s e . They d i d go t o ' y o u r in v e s t m e n t s a r e no t b e in g lo o k e d I am i n f e r r i n g t h a t t h e y w o u ld n 't you p r o b a b l y a r e , w it h t h e g r e a t e s t o f b u t t h e y would h a r d l y move i f t h e y were D is e n c h a n t e d was my i n t e r p r e t a t i o n o f what I t h o u g h t 21 was g o in g on. 22 t h e p e r i o d up t o t h a t p o i n t t h a t I was i n t e r e s t e d i n 23 b e c a u s e you had an i n t e r e s t i n Chunga and you a l s o 24 had an i n t e r e s t i n G arenne and o v e r t h e p e r i o d 25 C o l l e g e T r u s t e e s were m anaging th e v a l u e o f t h o s e 26 funds. 27 th a t p ro ce ss, 28 from them p e r i o d i c s t a t e m e n t s o f y o u r in v e s t m e n t a t 29 your re q u e s t. You d i d no t s a y t h a t . I would l i k e if I t was r e a l l y to u n d e r s t a n d a b i t more ab ou t I may. For in s t a n c e , you o b t a in e d 1 2 226 Q. 3 A. 4 227 Q. B ut you o b t a in e d p e r i o d i c s t a t e m e n t s ? Yes. Those s t a t e m e n t s would have shown you a p o r t f o l i o o f 5 in v e s t m e n t s w h ich m ig h t have i n c l u d e d money on 6 d e p o s it? 7 A. I d o n ' t know and t h e r e i s no p o i n t i n me s a y i n g I do 8 when I d o n ' t know what t h e y i n c l u d e d . 9 lo n g ago, 10 228 Q. 11 A. 13 229 Q. 14 A. 230 Q. 17 I c a n ' t remember. Mr. M c C a rth y , m ig h t t h e r e have been some money on You mean c a s h ? Money on d e p o s i t , yes, a d e p o s it acco u n t? Anybody i n t h e room c o u l d s a y y e s o r no, I h o n e stly M ig h t t h e r e have been d e t a i l s o f some e q u i t i e s i n g ilts 18 A. 19 2 3 1 Q. 20 w h ich you m e n t io n e d ? I w ould im a g in e s o , yes. M ig h t t h e r e have been a h o l d i n g o f s h a r e s i n n o n - p u b l i c l y q u o te d c o m p a n ie s ? 21 A. 22 232 Q. 23 I w o u l d n ' t t h i n k so . M ig h t t h e r e have been b a l a n c e s h e l d i n o t h e r c u r re n c ie s ? 24 A. 25 23 3 Q. 26 I c a n ' t remember, b u t I d o n ' t t h i n k s o . E s s e n t i a l l y what you can remember i s in v e stm e n ts, A. t h a t t h e r e were in e q u it ie s or g i l t s ? I am no t s a y i n g t h a t i s the f u l l e x te n t but t h a t i s what I can remember. 28 29 too d o n ' t remember. 15 27 is d e p o s it? 12 16 It 234 Q. If you can remember t h a t , may I e n q u ir e d i d you have 1 p e r i o d i c d i s c u s s i o n s w it h C o l l e g e T r u s t e e s about 2 what e q u i t i e s o r g i l t s 3 in ? 4 I n e v e r met C o l l e g e T r u s t e e s and I n e v e r had any 5 d i s c u s s i o n s w it h C o l l e g e T r u s t e e s . 6 235 Q 7 L e t me a s k you a more open q u e s t i o n t h e n ; who was i t who d e c i d e d what y o u r fun d s h o u ld be i n v e s t e d i n ? 8 A 9 236 Q 10 A 11 237 Q 12 A In D u b lin . 13 238 Q In D u b lin ? 14 A 15 239 Q 16 I w ould s a y th e p e o p le i n G u in n e s s & Mahon. The p e o p le i n G u in n e s s & Mahon? Yes . G u in n e s s & Mahon w here? T h a t i s my i m p r e s s i o n . So th e p e o p le i n G u in n e s s & Mahon D u b l i n d e c i d e d what i n v e s t m e n t s would be bo ught o r s o l d ? 17 A 18 240 Q 19 20 y o u r h o l d i n g s s h o u ld be h e l d To th e b e s t o f my r e c o l l e c t i o n . You were p e r f e c t l y c o m f o r t a b le w it h t h i s a r ra n g e m e n t , A it worked w e l l from y o u r p o i n t o f v ie w ? I w a s n ' t f o c u s i n g my whole m ind on t h i s in v e stm e n t, 21 maybe I s h o u ld have been b u t I had a l o t o f t h i n g s , 22 I to o k on f a r too much i n t h o s e t i m e s . 23 was I s a t i s f i e d o r was I no t s a t i s f i e d - - 24 am 27 y e a r s out o f i t , 25 241 Q I a p p re c ia te th a t a lo t of d e t a i l s l i p s m in d, b u t I am s o r t o f a s k i n g you 27 . . . . ( IN T E R J E C T IO N ) . A 29 242 Q I mean I I c a n ' t r e a l l y remember. 26 28 To a s k me from o n e ' s I am no t t r y i n g to be d i f f i c u l t . No, no, I a p p re c ia te t h a t . 39 I am s o r t o f a s k i n g you 1 f o r im p r e s s i o n s t h a t you have b e c a u s e q u i t e c l e a r l y 2 you had a s i z e a b l e sum o f money w it h G u in n e s s & 3 Mahon and i f 4 p r e s u m a b ly you would have o b s e r v e d t h a t ? 5 As you know much b e t t e r t h a n I would know, m a r k e ts 6 go up and down and have gone up and down o v e r th e 7 years, 8 have a c o n s e q u e n c e on th e v a l u e o f an y p o r t f o l i o . 9 243 Q It t h a t had been d i m i n i s h i n g i n v a l u e , so I would be aware o f t h a t and t h a t would was l i k e l y t h a t some s h a r e s d i d w e l l and some 10 s h a r e s d i d no t do so w e l l i n th e o r d i n a r y c o u r s e o f 11 e q u i t y in v e s t m e n t ? 12 A 13 244 Q 14 15 Yes . If t h e r e were in v e s t m e n t g a i n s made on o c c a s i o n , were t h o s e d e a l t w it h from a t a x a t i o n p o i n t o f v ie w ? A They w e r e n ' t t a k e n out o f th e fun d b e c a u s e t h e y went 16 up. 17 aro u n d t h e C h r i s t m a s t im e and t h a t i s 18 statem ent. 19 up o r down. 20 how 245 Q The o n l y r e a s o n t h a t I lo o k e d f o r an y c a s h was a general I t w a s n ' t t r i g g e r e d o f f by a fun d g o in g I am c o n s c i o u s , Mr. M c C a rth y , that i t is past 21 1 o ' c l o c k and I know we a l l need t o g e t some 22 re fre sh m en t. 23 an y r e t u r n s to th e Revenue C o m m is s io n e rs i n r e s p e c t 24 o f an y i n t e r e s t t h a t you may have e a r n e d o v e r t h e 25 y e a r s on t h i s 26 A J u s t one f i n a l q u e s t i o n ; d i d you make fun d t h a t you had i n G u e r n s e y ? The Revenue a r e aw are, f u l l y aware o f th e whole 27 s itu a tio n . 28 You d i d no t make any r e t u r n s b u t you have s i n c e been 29 d e a l i n g w it h th e R e ve nu e? The q u i c k answ er i s that I d id n 't. 1 2 247 Q 3 A 4 Yes . MR. ROWAN: 5 A lr ig h t. Mr. M c C a rth y , t h a n k you v e r y much in d e e d 6 f o r coming i n to answ er q u e s t i o n s t o d a y . 7 q u e s t i o n s and an sw ers w i l l be t r a n s c r i b e d and 8 Ms. Cummins w i l l be i n t o u c h w it h you i n due c o u r s e 9 ab o u t g e t t i n g you t o come b a c k i n t o s i g n a copy o f 10 th a t t r a n s c r ip t . 11 R ig h t. 12 MR. ROWAN: The Ms. Cummins w i l l have a b r i e f c o n v e r s a t i o n w it h 13 14 you on y o u r way out ab out th e documents w h ich we 15 have d i s c u s s e d w it h you t h i s m o rn in g and w h ich we 16 hope you w i l l be a b le to p r o v i d e us w it h i n due 17 course. 18 MR. O'GRADY: 19 May I j u s t c l a r i f y what you r e q u i r e i n t h a t 20 regard, 21 C o l l e g e T r u s t e e s managed h i s 22 . . . . ( IN T E R J E C T IO N ) . 23 MS. MACKEY: e s s e n t i a l l y you have t o l d Mr. M c C a rth y t h a t 24 fu n d , so t o t h a t e x t e n t No, we have no t t o l d Mr. M c C a rth y t h a t C o l l e g e 25 T r u s t e e s managed h i s f u n d . 26 Mr. M c C a rth y and y o u r s e l f t h e c o n n e c t i o n between 27 C o l l e g e T r u s t e e s and G u in n e s s Mahon Cayman T r u s t . 28 29 We have t o l d 1 told there were some payments and I am not sure 2 whether it was yourself or Mr. Rowan who said 3 something to that effect or put it to Mr. McCarthy 4 that College Trustees managed his investment. 5 MS. MACKEY: 6 We asked you if College Trustees did. Essentially 7 what we are looking for from Mr. McCarthy, 8 Mr. O'Grady, are any documents he has in connection 9 with his original investment made in what he 10 understood to be Credit Suisse but which would 11 appear it would seem to be College Trustees. 12 A. 13 Not to my knowledge. MS. MACKEY: Not to you knowledge. In 14 any event, whatever he has 15 in connection with that investment to Credit Suisse, 16 anything he has in connection with the Garenne Trust 17 and any documents which were the basis of that note 18 that he prepared today for our interview and which 19 he has read. 20 MR. O'GRADY: 21 I suspect in fairness to him that the document may 22 have been, and I am speculating, but may have been 23 prepared from correspondence with the Revenue and 24 not from original documentation. 25 A. 26 24 8 Q. 27 28 29 Yes. MS. MACKEY: Presumably the correspondence for the Revenue was prepared from something else. 1 simply do not know. 2 Presumably you do not require our file in relation 3 to correspondence to and from the Revenue? 4 MR. ROWAN: 5 I think our difficulty is that we learned from 6 Mr. McCarthy in response to our questions, we 7 learned some information this morning. 8 information was available from some other source. 9 If that source was a document and we believe it was That 10 applicable to the purpose of our interview today, 11 then we would like a copy of that document. 12 not exactly know what the documents are and you will 13 have to ascertain that with your client. 14 MR. O'GRADY: 15 We do I would simply like to make the point as well 16 that the connection between College Trustees is not 17 something that Mr. McCarthy would have been aware 18 o f. 19 MS. MACKEY: 20 We appreciate that totally and we are not in any way 21 making a criticism of Mr. McCarthy for not providing 22 this information to us, not at all, and we would not 23 like you to think that. 24 with you now, now that we have a broader picture, of 25 what it is we would like. 26 the basis on which he prepared those notes and gave 27 us some information that he has jotted down there 28 today. 29 was able to indicate that the sole asset of Chunga We are simply clarifying Basically what we want is For example, as Mr. Rowan said earlier, he 1 was a sum of £138,000 and that information came from 2 somewhere. 3 MR. O'GRADY: It was a loan of 4 5 £138, 000 . MS. MACKEY: That information is 6 somewhere that we have not 7 seen yet, so that is the kind of thing that we are 8 looking for. 9 anything in relation to Chunga and anything in Anything in relation to Garenne, 10 relation to the investment with Credit Suisse in 11 Mr. McCarthy's possession or power is basically what 12 we are looking for. 13 MR. ROWAN: I think also we are 14 dealing with 15 Mr. McCarthy's recollection and it is a long time 16 ago and we fully understand that, but we also know 17 from other aspects of our investigation that Credit 18 Suisse became involved at a particular time with 19 Guernsey and the transition from Guinness Mahon 20 Cayman Trust to Credit Suisse and so on all have 21 time scales on them. 22 MR. O'GRADY: 23 Again you are saying the transition from Guinness 24 Mahon Cayman Trust, that is something of which we 25 are not aware. 26 Mahon that there were payments into this account, 27 this Guinness Mahon Cayman Trust account from 28 Chunga. 29 Cayman Trust managed the ....(INTERJECTION). We have been informed by Guinness & You are inferring that Guinness Mahon 1 2 anything. 3 MR. O'GRADY: 4 When you said the transition from Guinness 5 Mahon Cayman Trust -- I am really trying to 6 ascertain precisely what you require and that is why 7 I am asking this. 8 MS. MACKEY: 9 What we require is precisely what I have 10 said. 11 have transmogrified into what. 12 have on Chunga, anything you have on Garenne, and it 13 is quite specific, and anything you have on the 14 investment with Credit Suisse. 15 any documents referring or relating to those three 16 aspects. 17 MR. O'GRADY: 18 19 A. We can leave aside all inferences or what may 22 23 24 25 26 27 28 29 Those three aspects, Okay, thank you. I would just like to thank you for your kindness. MS. MACKEY: 20 21 We need anything you END OF INTERVIEW Thank you, Mr. McCarthy. .ww/ \V?C?kk CkkaW?mS So?olbon PgucavxS}; .1000 IN THE COMPANIES ACT, 1963-1999 AND IN THE MATTER PART H OF THE COMPANIES ACT, 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (FORMERLY GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED AND CAYMAN INTERNATIONAL RANK AND TRUST COMPANY LIMITED) STATEMENT OF DENIS McCARXHY A. By undated letter received fay me on 14 April 2000 (die “Inspectors’ Letter”) addressed to me and signed by the three inspectors (die “Inspectors'*) appointed by the High Court to Ansbacher (Cayman) Limited (the “Company") I have been requested to provide as unsworn statement in relation to the matters set out in appendix C (“Appendix C") to the Inspectors’ Letter. B. I have never to die best of my knowledge knowingly had any dealings with the Company and had never even heard of the Company until in recent times I saw references to it in the newspapers. C. Because I have not, to the best of my knowledge, had any dealings with the Company, I do not have any books or documents in my custody or power relating to die Company. D. I have in the past had dealings with Guinness & Mahon (Ireland) Limited (die “Bank”). E. By letter dated 17 November 1999 the Bank indicated to me that I might be a person who could be affected by the terms of High Court orders dated 13 September 1999 and 11 November 1999 (copies of which I attach). By further letter dated 6 December 1999 the Bank indicated to me that I might be a person affected by the direction of the Inspectors contained in a letter dated 24 November 1999 from the Inspectors to fee Bank (copy of which is attached). As I had never, to the best of my knowledge, had any dealings with the Company, I passed the said letter dated 17 November 1999 on to ray solicitors, who telephoned fee Bank to seek an explanation for the Bank's opinion that I might be a person who could be affected by die terms of High Court orders dated 13 September 1999 and 11 November 1999. The Bank informed ray solicitors that there was an Ansbacher account which was entitled Re College Trustees in which was listed payments to certain offshore entities, including payments to a Guernsey incorporated company named Chunga in which Mr Des Traynor, on behalf of the Bank, had invested some monies belonging to me in 1973 . My solicitors were informed that there were three references to Chunga in the account, which, the Bank said, appeared to be references to fees in respect of company formation services and annual administration fees. The Bank-indicated that the monies involved were very small and that they were notifying me merely as a precaution. F. I have requested die Bank to ftirniah me with copies of all documents in their possession relevant to die matters outlined above. I do not have any documentation relevant to the payments from the Ansbacher account entitled Re College Trustees in my possession. I intend to forward any documentation ftimished 1 7 die Bank to me in relation to the matters outlined above to the Inspectors. G. I am willing to attend before die Inspectors for die purpose of being examined in relation to any information contained in this statement or in any documents which I may be in a position to forward to the inspectors upon receiving a reply from the Bank. H. Regarding the matters set out in Appendix C, the position is, to the best of my knowledge, and, subject to my comments in paragraphs^and /above (which comments represent die totality of my knowledge of die matters upon which I have commented), as follows (in the same numerical order as the items referred to in the Appendix C) 1. I did not cause to be executed a deed of trust or other instrument in the Cayman Islands or elsewhere whereby the Company or some other person associated with it or acting at its direction was a trustee or managed a trust, nor did I transfer monies or other assets to any such trust, nor did I cause to be established in the Cayman Islands a body corporate to which I caused to be assigned money or other assets which were managed by the Company or some other person associated with it or acting at its direcdon. 2. I did not avail of die service or of a service of a similar type offered by the Company to that outlined in paragraph 2 to Appendix C. 3. I did not avail of die service or of a service of a similar type offered by the Company to that outlined in paragraph 3 to Appendix C. 4. I did not avail of the service offered by die Company outlined in paragraph 4 to Appendix C. 5. I did not avail of the service offered by die Company outlined in paragraph 5 to Appendix C. 6. As I did not avail of any services provided by die Company, the issue of whether or not I or someone on my behalf applied under die Exchange Control Acts for permission in relation to any such transaction does not arise. 7. I did not avail of the service offered by the Company outlined in paragraph 7 to Appendix C. 8. No company or trust in which I had a direct or indirect interest or which was directly or indirectly controlled by me or whose income or part of whose income I had power to enjoy had any dealings with the Company. Signed: DENIS MCCARTHY M:\Brownem\TOQ\McCtrthy.doc Appendme \ s-,'- GUINNESS+ 17 College Green Dublin 2 P.O. Bot(] GMCT /COLLEGE SUNDRY SUU CO CURRENCY S Tt RLl NG ACCOUNT DESCRIPTION fcXTERNAL P A R T IC U L A R S t ; . DAT£ 'CHUM* ACCOUNTNUMBER LEDGER value : date STATEMENTDATE D E B IT C R E D IT uuseu?I: . . ?0.1 mm?. ?itJana-"mag may: Nil m? I?l?ll I. - amt: "Cumin; nut . - ?can u?o ?Lamps - - . - . .- . It i n. ost . V?anu.u? .. \c I. I Jun-Io 30?. .. 3?ngha . « C0 X. Definitions. 2. B » Proper taw Including Power to change each lw . • . 3. T n iti fox sale and la w tM t. 4. Trnata o f lnooaa and capital. 5. Powers aa to paj f aata to charities. 6* Powufi o f appointment and advaaosaMat. 7. Powers to exclude and include Benefloiariaa. B. Payaanta te r the baoaflt of atanra. 9 . General tcw u i oC w lle y tla t and fllapoaal o f vxnat property aad Power fo r Craataaa to ebargi fee* and to par Am a, 10. Power to fa n aa^anlea aad other a e titia a . 11. Power not to Interfere la aanageatnt. 12. Power to mate loans. 13. Powers to s e ll, laaaa aad exchange, to vote aad give proxiea. 14. Powers relating to Chattels. ' 15. Oaaaral proria iona relating to tha emreiaa o f Powers. 16. Power to w y the Powers haxraadar. 11. Lim itation a* to esarol aa of Powera. . 18. Appoint—at of aew Troateaa. 19. Tnd—n1f 1catloo o f retirin g Troataea. 20. Oaaaral Tnrt—n lty of Trustees. 21. Proriaioaa aa to diaeloanra o f lafotaatloa. 22. Maaa 23. Power to change a a a . . 24. Irrevocability of SettiLweea*. ' Bchadulea 1. In itia l settled Property. : 2. P in t niaed Benefidarias. 3. Included peraona. THIS D l C L k l t T I O l ^'f s T and d*y o f OF TRUST is sad* th a ana Thousand Mina Bundred S t v t n T y S ttfH T .. B V COLLEGE ZRUSTEKS LXMXRD o f i t . O n U ai'i Court, S t. J u li*» 'a Avanus, a t. Peter Port, Goarnaay (hereinafter callad "the Traataea"). • 101 T i l l 1. D ill as fB lle m t- In thia Settlement wherever the context pazmlta the following . worde have tha following naaniagai- . (a) "Tha B enefidariaa’' aaana and l ncl adaa a ll and any o f tha persona naaad ok deaerlbad la tha aeoond MhaWia hereto. . Za dateraining whether or not a pasian la c m o f tha ' Benefidariaa an adopted or lagitiaatad person sh all ba • treated an a child of hia d e p tlw as Itg ltia itiw parent aa tha oaaa aagr bn and o f no other parana and reference* to tha isaua.of any ptnaa shall inclodi tha d illd raa ■ and n n star ieaue o f each parson through a ll dagraaai . Ob) "Excluded Parsons* aaana and'includes n il and any o f tha parsons naaed ok described la tha th ird k M sI* haratoi , . * ( f ) . "The Troataaa" ah all naan tha Trustee or Tnataoa fo r tha tiaa being hereofi (g) T r ust Vund" aaana i(1) tha soi o f sonsy aantlooad la the fir s t SchaA ila haratoi <11) a ll acney, inveataents and property paid or transferred to and accepted by the Trustees u additions to the Txuat Fundi and (H I) tha iavestaenta and proparty froa tlas to tiaa representing aucfa aaaay, JLnwataeata and addition* or any puts thereof. Os) "tte Truat Period* shall Man tha period faoa tha data hereof u n til whidwver of the following days ahall occur d ra t aaaalyi(I) tha day on whlcb shall axplra tha parlod of eighty yaaxa after tha execution o f thia Settleaent; . ( II) anch day ( if my) aa .tha Tnustaee mttj at th air dlaeratlon appoint by deed executed prior to tha day specified la paragraph (1) of thla atfc-olauaei ( ill) tha day of aspiration of twenty-one yaaxa after the death of the laa t aurrivor of tha Beneficiaries being paracpa living at tha data haxaof wan thou^i sudi PanaflciBxy say not tn a baas a Beneficiary at tha tiaa of tha eaacutloa here«fi (1) ■Mopertj'' shall aaan nd Include any Meal or N im m I Property wharvecever aitoata and any rl£ ita or interest legal, equitable or otherwise la or over such property as aforaaald. • (j) words inverting tha asaeuliae gender aha ll lscloda tha faainlne gender. ' . ' (k) words la tha singular shall lncl uda tha plural and words In tha plural ahall include tha singular. - ' This Sett leaent Is estafallshsd wdax and la accordance with tha Ia n of tha Xslsad of Guamaey and tha rl^ tta of a ll pasties and tha ooostraction and affaot of aach and a n iy provision hereof ahall ba aAJaet to tha exclusive jurisdiction o f and eeaotrued and regulated only according to tha Ia n of tha said Island which shall ba tha flm si for tha (M a litx a * tlcn haxaof saw only that notwithstanding tha foregolag provisions of this clauae tha Trustaaa ahall have tha power at tha lr dlaeration to declare by Inatrunant la writing or by Daad vhlefcamr My ba applicable according to tha Proper Law of this Settleaent (which axpraaaion sha ll aaaa the la r of' Ouexnaay or of aueh othar atata or territo ry as nay ta*» been froa tiaa to tia a declared by tha Trustees la eaarolsa o f tha powars conferred by thla clausa) froa tiaa to tiaa executed within tha Truat period, that thia Sattlaaant shall thenceforth taka affaot in accordance with tha law of acaa othar atata or territo ry in any part of the world (not being a plaoe under the law of which (1) any of tha m a t*, Powers and Provisions herein declared and contained would not be enforceable or capable of being exercised and so taking effect or (11) thla lettlaaan t would be capable of being revoked) and tha forua of adatalstxaticn ahall thenceforth be the Courts of that state- or territo ry and tha law o f that atata or territo ry shall thancaforth b« applicable to thia Settlement and fuzthazaon tha Truataaa ahall have power to aaka auch conaaquential altaraticna or additiona to tU i Settlensat to enauza that tha Truata, Powara and Previaloos hereof shall (autatla autandia) ba as valid aid affective aa thay ondar tha law of Goarnsay which aapreaaion herein shall asn tha law o f Guernsey or of such othar stata or te rrito ry as ■«y hava bean txom tiaa to tine daclazad by tha Truataaa la aaardae of tha pcaiaza confamd toy this elaoaa. Tha Tnataaa shall stand poaaaaaad of tha T n at ta d qpen Truet aa to ia m tm ta or property othar than m ay In th alr abaolnta dlacratlon althar to pandt th* aaaa to re n in as Isvaatad or to s a il w convert into acney a ll or any o f anch invastaaats aid Open tn a t aa to aonay with tha Ilk a die oration to In w t tha saaa la th alr naaaa or under th a lr control la icy of tha inveataenta haralaaftar anthorlaad with powar at tha HXa dlacretlen fn a tia a to tiaa to vary or tranapoae any each in u ta n t* fo r others of a natara haraby aathoriaad. * • Tnataaa ehall atand poaaaaaad of tha tn a t ta d and shall apply the lnoeaw tharafraa during tha T n at Varied la aaeh Banner and la each aaounta for tha banafit of «jy ona or a ll of tha Banafiaiarlea as they Shall la th alr abaolnta diaczation thlak f i t and tha Trualeea without prajndloa to tha fonffolag pzoviaioo ahall hana powar to eccaaulata anch lnooaa as thay aaa f i t for tha aa-rlana parlod pesadttad by tha Law of tha Island of Guazaaay and any laeeaa aeciil.atad aa afenaaid ahall fora part of tha capital o f tha Truet and a t tha avU atfca o f tha T n at Varied CPCM JK3ST aa to both capital and laeeaa of tha T n a t ta d for a ll or anch ooa or aon aM ln ala of tha othar or othan of tha ■anafidaziea la such shasaa and prcportiana I f aora that one and generally la such awinar aa tha Tnataaa shall than la th alr Aaolnts dlacratlcn detszaina and la dafaalt of and Subject to aaeh detazalaatioa WON n o n In -aqual aharaa abaolntaly tax apch of tha lo tlte ta x la s aa shall than ha liv in g oz ead.atla«i MOVZOD B H i ap ieaafieiaxy nor a ll of thaa In ocatilaatlon ahall ham any rig ht of any klad as agalaat tha Tnataaa or tha Trust rand or any othar parson nr too^y paraooa by «irtoa only of being Banafloiazlaa any rula o f law, eqaity or othaawlaa to tha eentrasy notwithatandlng... In tha-event of tha fa llu n or dataadnatlen of tha Trusta la this danse hereinbefore contained and adbjact tharato'and to tha provisions of thaaa pzasants and to tha Vmars haraby or toy law oonfarrad on tha’ Tnataaa and to any and evacy exercise of atadt Powers and In tha event of no additional Baaafidarlea being appolntad toy tha Trustees in axareiaa o f th alr Powara harain oonfarrad pzlor to tha aiqpiratioe af tha T n a t Varied tha Truataaa ahall hold tha T nat Tund open tha following Truata (a) M rlitg the Trust Period aa to any In com of tha Truat Fund accruing during such period UPON ntOBT to pay or apply tha u m to or far such charitable institution or Institutions or other charitable object or objacta aa the trustees aha11 In th alr absolute . dlacratloa aalact and in such proportions I f aora ttm one and generally la auch aamar aa tha Txuataaa shall la thalr 111m discretion determinei (b) At tha axpixatioo of tha tn a t Varlad M flO R aa to both capi tal aad In com of tha Truat IM So* such chadtabla object or objects and I f aora than one la auch sharaa aa the Truataaa ahall la thair absolute discretion daterminal aad (c) Sa default of tha exardae of any H w t or diacretioe under thla danaa aad la tha event of tha failure or dataralnation of tba other Truata hereinbefore contained VCN s o n for tha Jersey rand far Blind cad.Ideas abaolutely. ■ Motvlthataodlag tha Truata and H « m kaM ldM ftn dadand a d aoat alnad tha Txuataaa ahall b m raver w n is A la la thalr absolute dlacratloa at any tlas or tlw a p rior to tha taxalaatioe of tha Icaat Varied to pay or apply any part of tha capital or lace— of tba tn a t Mad to or for nek charitable institution or lnatitntiona or othar d ia rit*la object or objacta aa tha Trostaaa shall la thalr absoluta dlaeration salact aad la eueh proportion if aora than ana aad ganarally la auch aarwar aa tha Truataaa ahall la thalr Ilk a dlaexatian think f i t aad tha receipt la writing of tba Traaaurar or othar oftlear of any particular char ltabla laatltatlca authorised to give raoaipta for aoaaya paid to that institution ahall ha a au ffld en t dl schargs to tha Txuataaa for any p q M t paid to a«ch Inatitution haraoadar. ■ ■otvlthatending tha tn a t* and provisions hereinbefore daelarad aad contained tha Trostaaa a q at n r tlaa or tlaaa drirtng tba SMat Varied I f la ' thalr abaoluta dlaeration thay ahall so think f it by say Inatrunsnt or Inatraanta la writing or by Daad or Paada rid d a w Mgr ha m U cd ila according to tha proper la f of thla Sattlaanat revocable dnriag tha tn a t Varied or irrevocable appoint such m m or othar Trnata Venera and provisions y iw nad by tha'laM'bf ■nyjj«lft_0f _tha'**0rld- of and concerning tha M a t Tm/A or any part or parts thereof for tha banef it of the Beneficiaries or any one or aora of thaa exclualve of tha othar or others at auch aga or tlaa or respective agaa or tlaaa aad in auch aharaa and proportions aad avbjaet to auch taras and llaltatlcn a and with and subject to auch powers of avpolntsant vested . la any parson or persona aad auch provisions for Maintenance education or advancement or for accuaulatlen of laccaa dnriag alacrity or for tha puxpoea of raising • sub ox aaaa of capital os for forfeiture In tha event of desaatre, insolvency or budmftejr aanay b« applicable according to tha pxepax law of this Sattlaaant and otharwiae at tlia discretion of any parson or peracaia -and with inch dlacretlchary Truata and Pcwera eaerdaabla by such paxaona aid ganexally la and) aannar aa tha Trustees may think fit for tha benefit of auch aaneflclaxlea or any ana or aoxe of thea aa afaxaaaid and for tha purpoaa of giving affaet to any aoch appointaent by tha aaaa Inatruaant la writing ox Daad whichever Mgr bji applicable according to tha prepax law of this Sattlaaant revoke all or any of tha Truata Powers and provisions herein contained with reapeet to tha Trust fund ox tha part or paxta' thaseof to wbich audh appointasnt relataa aid ao that la tha aaat of any n A appoiataant tha Troataea ahall thenceforward hold tha-Truet rand ox the part or paxta thereof to which anch appoiataaat relataa apea with and aiAiject to tha Truata Pcwexa and provlslona ao appointed In ad>atitutlca fox aqr of the Truata Powers aad provisions hereof ao rsvokad aa afoxaaald aid la priority to the othar Truata Powaxa and provisions herein declared aad contained a d la a y qppalntaeat endax tha foregoing Power tha Troataea aay delegate te any paxaca ox pexaoaa all ox any of the Powaxa aad dlacxatiena by thia Sattlaaant ox by law Wkttd in tha Truataaa. Notalthataadiag tha Truata, Powaxa aad provisions herein declared and contained tha Troataea ehall have the following Peuera eaerdaabla during the Trust Period, that la to aay the tower to escloda aay paxacaa or claaa of paxaona froa tha claas of Maattdaxlaa hareof aad tha Power to include any persona or claaa of persona in tha claaa of ■aaeficlaxiea hareof and thaaa .Pcwaxa ahall be eascdaabla la aaafa a waff aa to exclude a pexaon prevloualy Ineluded by tha exercise of thaaa Powers ex -to include a paxaca previously excluded by tha aaaxdaa thereof without llaitatica aa to tha narisax of tiaaa' which a person aey.be ao Included ear excluded. Notwithatending anything contained la this Claoae or la this Settlement, la ao dreuaataaoaa ahall any imlnrtad Paxaca ba paxalttad to ba a Banafldaqr. . Mhere tha ftuatsaa are authorlaad ear required ts apply any inccaa or capital of tha Txuat Tend to ax fox tha benefit of aay paxaca who la a i n or the Trvataea aay la thalr abeoluta discretion elthar p^r tha aaan to hla or hex aa hia or her absolute property notwithstanding that ha ex aha la a alnox aad tha raoalpt of any auch alaox Beneficiary if paxalttad by tha proper la* of this Sattlaaant ahall ba a good discharge ' to tha Ikuataaa therefor ox pay the aaaa to any paxaat or gnaxdlaa of auch ainor without seeing to tha application thereof aad tha raoalpt of auch paxaat ox guardian ahall ba anfflclant diacharge to tha Truataaa far any inccaa or capital ao paid or applied. 9. ' ttia Truataaa ahull h n * tha following ta n a i(a) To invaat or othazwiaa dlapoaa of or da&l witfc tha Troat rand and to aaardaa th alr diaetatlon o*ar tha iu a aa If thay m u * afaaoluta banafleial ownara and tha tallowing elauaan khall not daxogata frca tha ganaral Powaza ooofamd by till* clanaai (b) To oaa tha Vrnat rand la any way whataoavar according to th alr abaoluta dlaczatlon aa tfeoutf) thay wara abaolnta baoaficlal owoaxa aid notwithatandlng any rulaof lm erf aqulty or otharwiaa to tha contrary and without pxajudioa to tha guaranty of tha foragolng pxovlaion ahall bawa Powar to aoqnlza any propaxty «h«tMnu awn tfaougi aueh pxcparty ahall ylald no laooaa and a m though auch preparty ba a wanting aaaat and avan thoufr aocb proparty ahall ba of banaflt to ana or now of tha •anafleiarlaa hazaof only to tha axeluaIon of tha othar ■aoaflelazlaa haraofi tha prtrrtalooa of thla avb-dauaa ahall apply to any lnvaatnant or dlapoaal of or any othar daallag with any of tha Trot Pond and any raatrlctian or llaitatlan l^ioaait hr nla of lav or aqtdty ox.othazwlsa ahall accordingly ba Inapplloabla harato. .' (e) *a borrow nonay or giva or antar lnta gnarantaaa aq tha aaeoxlty of tha m a t Fond with powar to charga any past of tha capital or inooaa (Including any futora inooaa) of tha Truat ta d with tha npayaant of any aooaya .ao borrowad or guarantaad and to pay or apply tha nonay ao ralaad la any am ar in wttidi nonay foraing part of tha capital o f tha Truat Pund nay ba paid or appliod and ao that tha froataaa ahall hare powar to antar into any jo in t borrowing arrangasmta with any paraon and abattoir or not im M a i' jo in t or awwaral lia b ility and na pnrchaaar landtr or othar parson paying or advancing nonay an a aala nortgaga dnqa or othar tranaaction purporting to bo nada by tha Vraatana ondar or fBr any of tha pwipaaaa o f thla Sattlanant ahall ba oanoamad to aaa that tha nenay la wantad or that no aora than la wantad la ralaad or othanlaa aa to tha preprlaty of tha tranaaction or tha application of tha nonay. (d) Itarthar and without any pcajodica to tha ganarality of tha fozagaiag pztnrlaiona tha Truataaa ahall ba aavxaaaly author!aad hazaby to dalagata any or a ll of thalr dvtiaa or Powers « t o thin lattlaaant to any paraon vhataoavar without lia b ility for loaa Mid i f ouch paraon ahall ba acting in tha couraa of hia trada, pxofaaalon or vocation ha ahall bo antltlad to propar raaunazation out of tha Truat rund. (a) Any Truataa haraof who ia a corporation ahall bo antltlad to raaunaration for acting aa a Truataa haraof In accoxdanoa with its acala of chargaa aa pobllabad froa tin t to tina i f any or in tha abaanca of audi ptfcllahad acala aa aforaaald ahal l 1m an titlad to raaaonabla ranunaratlcn tor »o acting and any m a tt* who la a profaaalanal parson of any daacriptian ahall ba an tltlad to pzopar n M M n tlc n foe work ondartakan la his o p to ltr aa a profaaalanal paraoa oat o f tha Traat fund (althar capital or laooaa) and any Truataa .haraof ahall ba an tltlad to pxopar raaunaratlon fo r acting la tba capacity o f Truataa haraof oat of tha Traat ta d (althar capital or Is com ) . I t ) 9m Troataaa ahall haw fw w t o pmy any dotlaa and taxaa floe vbldi thay My bacona lia b le In any part of tha world notwithstanding that neb lia b ility aa a tm u M Mgr not ba aoforoa'abla throu^i th t Coorta of tha Island o f Oeanaay or of lo d i other ta rrlto ry aa a q ham bacoaa tha fq n fear tha adnlniatration haraof by *irtn e o f Hm aaerdaa by tha goeuateae of th air Vowan In that ngard ondax olanao 2 haraof. (g) flu Troataaa ahall not bo llab la in mepact o f any pnpoctat anarotao of any dotiaa or fotfora oodax thla fn a t aava only that I f thay h m / * aetad fraodnlantly thay ahall not ba an tltlad to tha protection oonfarmd haraby. ' • : j; ■ 31. Oh* Trostaaa ahall net ucapt undax caaptOiion of law of tha Island of Guarnsay or of tha Pzopac Law aa daflnad in clauaa 2 haraof, dlvulga os dlacloaa dlractly or indlractly to uxf tax or fiscal authority aqy information relating to tha Truat Fond or tba tn a t Daad or to tha aaaats or tha . BaaaficLarias thazaof axcapt that n latln g to thla clausa aad to tha third aehadula. 22. TUm dattlanant ahall be know a* ft* Banana *n a t. 23. Dm naan o f thla Sattlaaant M tr ba ehangad by tha Tt.uaf as at th a lr dlacratloa to aach othar aaa or naaaa aa thay canaldir f it . A aaaoxandoa raooxdlng aaab and n tQ diaaga of nana ahall bo affixad to tha original tn a t daad. 24. Thla SatUawnt ahall ba lm rocabla. jacaagr rtnd fas Blind Chlldnn . amngr Oxf«*> Jarsay midUfa Vnaanatlen Tnjat m m js s s * 1 . *ag pane* who la or la ' . tnatad aa naldaat In tha Xaland .of Quaxnaay for tba pvspoaes of t axatloa in that Island. 9B-OOMNCMlU l ofonmraa ukxted waa harasnto affixed In tha pnaanea of i- Bags 1. THE GARENNE TRUST NOTE INVESTMENTS AT COST (Market Value £68,482) 1 82,631 CURRENT ASSETS .)Cash at Bank 79,348 CURRENT LIABILITIES Creditors 7,7^4 7 1 ,604 £154,235 Trust Capital Account - See Page 2 For SOVEREIGN TRUSTEES LIMITED, TRUSTEES Direc £154,235 SOLICITORS 30 Herbert Street Dublin 2 Ireland tel + 353 1619 9000 fax + 353 1619 9010 dx 2 Dublin e mail mop@mop.ie www www.mop.ie MATHESON ORMSBY Prentice His Honour Judge Sean O'Leary, Noreen Mackey BL Mr Paul Rowan, Michael Cusli SC Office of the Inspectors Appointed by Order o f the High Court to Ansbacher (Cayman) Limited 3rd Floor, Trident House Blackrock Co Dublin PRIVATE & CONFIDENTIAL TO BE OPENED BY ADDRESSEES ONLY Our Ref Your Ref TOG/MB C/M04/NSPM 14 December 2001 Dear Sirs / Madam OUR CLIENT - DENIS MCCARTHY We refer to your letter dated 20 November 2001 to our client care o f ourselves. Regarding your preliminary conclusions, our client is not in a position to adduce evidence affecting one way or another the preliminary conclusion that our client was a client o f Ansbacher. We assume that, in this regard, you have drawn this inference from ledger cards dated 20 November 1981 and 12 January 1983 in relation to account at Guinness & Mahon entitled GMCT re College B/G account number 32713/03/68 and account in the name o f GMCT / College Sundry Sub Co account number 63127/02/16 respectively and other information in your possession to which neither we nor our client are privy. Our client is quite categorical, however, that, if he was a client o f Ansbacher, he was at all relevant times totally unaware o f this fact. He has been absolutely consistent in this regard both in his instructions to ourselves, his statement dated 8 June 2000 submitted to you and in his evidence in the course o f his examination under oath by you on 15 June 2000. His evidence in this regard is as far as we are aware, the only evidence in your possession which touches upon this issue. It is o f the utmost importance to our client that both you and all persons reading your final report are not given the impression that our client was aware that he was a client o f Ansbacher. Our client’s view is that the words “even though he may have believed his trust arrangements were in the Channel Islands” at best would not convey to the reader the fact that our client was unaware that he was a client o f Ansbacher and, at worst, could give the impression that you had some doubt, and had reasonable grounds for having such doubt, as to whether he believed that his trust arrangements were in the Channel Islands. For these reasons, we would submit on our client’s behalf that your preliminary conclusions in relation to our client should be amended to read as follows:- DUBLI N PARTNERS SirAnthonyO'Reilly (Chairman) Garrett Gilt Michael Irvine ArthurMoran GiuhamRichards AlanGraham MichaelTyrrell FrankNowlan Stuari Marsieison Donal Roche WilliamPrentice RodericKnsor JamesHickey PaulineO’Donnvai StanleyWatson Robert Heron LiamQuirke AndrewMuckian PatrickSwectman BrianBuggy DonMcAleese SimonMcAleese Paul Gle-dleld AndrewDoyle JamesScanlon Michael Jackson ChrisQuinn TimScanlon LONDON ASSOCIATES Dcirdre Morris DeirdreDunne HelenKelly PaulaMullooly SharonDaly V eil Keenan RuihHunter TonyWilliams TonyO'Grady PatrickMolloy ParaieMadigan Anne-MarieBohan Michael O'Connor KennethEgan EdwardMiller TaraDoyle Emer Hunt PatrickSpicer CatherineGalvin1 PALO NicolaRooney LisaSexton1 FrankO'Neill ' GregLockhart1 TurloughGalvin TanyaHolly SineadDuffy GeorgeBrady SusanO'Reilly CatherineYoung ALTO LisaBroderick VanessaByrne MarkVarian TaraMacMahon BarryLynch Robert O’Shea Paul Farrell Jacqui Cross LONDON ThirdFloor PinnacleHouse23-26St. DunstanNMill LondonEC3SIINEngland ti;.l+442076186750 fax+442076186790 PALOALTO375Forest Avenue PaloAlto CA‘M30I 2521 l.'SAti;l+6504700810 r\x +6504700811 nutamemberoftheLawSociety"IIreland CONSULTANTS AnthonyWalsh1 JohnRyan1 JohnGulliver1 BernardDoherty1 HilaryPrentice LorraineCompton KevinMcGilligan “ The Inspectors conclude that M r Denis McCarthy was a client o f Ansbacher, although at all relevant times he was unaware o f this fact”. We would be grateful if you would let us know whether or not you agree to make this alteration to your preliminary conclusions before progressing the matter insofar as our client is concerned. Yours faithfully , T H E H IG H C O U R T IN THE MATTER OF THE COMPANIES ACTS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES ACT 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R epo rt of th e I n spec to r s A p p o in t e d t o E n q u ir e in t o t h e A f f a ir s o f A n s b a c h e r ( C a y m a n ) L im it e d Published by Order of the Court made on 24 June 2002 V o l u m e [ 1 4 ]: A p p e n d ix X V ( 1 5 3 ) t o X V ( 1 6 7 ) ISBN 0?7557?1355?9 Government of Ireland 2002 A ppendix X V (153) M r H arold F M urray 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Harold F Murray. a) Transcript o f evidence o f Mr Harold T Murray dated 1 February 2001. b) Guinness and Mahon statement o f 31 March 1980 re Guinness Mahon Guernsey Limited. c) Internal Guinness and Mahon memo o f 30 September 1987 re GMCT/College. d) Guinness and Mahon statement o f 20 January 1986 re GMCT/College. e) Letter o f 4 January 1994 - IIB to Kredietbank NV. f) Internal IIB memo re Murray Group Holdings credit application o f 3 February 1989. g) Internal Guinness and Mahon credit committee memo o f 29 April 1977. h) Letter o f 25 April 1989 - IIB to Murrays Europcar Limited. i) Letter o f 23 July 1993 - Murrays Europcar to IIB. j) Letter o f authority - Murrays Europcar to IIB in respect o f accounts o f the company up to 31 December 1992. Correspondence received from or on behalf o f Mr Harold F Murray. a) Letter o f 3 December 2001 - O ’Donnell Sweeney Solicitors to Inspectors. UNDER OATH ON THURSDAY, 1ST FEBRUARY 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: HIS HONOUR JUDGE O'LEARY MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. HAROLD T. MURRAY Represented by: MR. NORMAN FITZGERALD O'DONNELL SWEENEY SOLICITORS 15 - 16 FITZWILLIAM PLACE DUBLIN 2 WITNESS MR. H. MURRAY I EXAMINATION JUDGE PAGE 49 1 2 23RD JANUARY 2 001: 3 4 JUDGE O'LEARY: 5 Mr. Murray, as you are aware, we are appointed to 6 investigate the affairs of a limited liability 7 company. We are not appointed to investigate your 8 affairs. We are appointed to investigate the 9 affairs of a limited liability company. 10 11 Unfortunately, there are many people whose paths may 12 have crossed the limited liability company we are 13 investigating and we have to ask them a certain 14 number of questions relating to their knowledge of 15 or business with the company. 16 17 Now, it is a reasonably informal procedure except in 18 one regard and that is the evidence is taken on 19 oath. 20 Ms. Cummins, to administer the oath. So I would ask the solicitor to the inquiry, 21 22 MR. HAROLD MURRAY, HAVING BEEN SWORN, WAS EXAMINED 23 AS FOLLOWS: 24 25 1 Q. JUDGE O'LEARY: First of all could 26 I 27 This is Miss Noreen Mackey. 28 inspectors and my name is Sean O'Leary, I am a Judge 29 of the Circuit Court and I am another one of the introduce both of She is one of the 1 inspectors. 2 simplicity sake, and to avoid the appearance of a 3 large number of people, we have, with regard to most 4 of the individuals, allocated one or possibly two 5 inspectors to deal, if you like, with any matters 6 arising in that case. There are four inspectors but for 7 8 So Miss Mackey and I will deal with anything which 9 arises in your case which may be nothing at all but 10 anything that arises we will deal with it. 11 understand? 12 A. 13 2 Q. 14 Do you Yes. Could I first of all say thank you very much for coming this morning and you are welcome. 15 16 The position is we are investigating a company which 17 apparently, that is all I can say at the moment, 18 operated in Ireland even though, if you like, based 19 in the Cayman Islands, operated in Ireland and 20 provided a banking facility to certain individuals 21 within Ireland and it is our job to enquire into 22 these activities, did they take place, and 23 ultimately to report to the High Court. 24 25 If you like, we are creatures of the High Court. 26 have 27 appointment 28 legislation. 29 Judge or Miss Mackey is a Barrister, that does not We if you like, no statutory basis other than by the High Court under the appropriate It is not because I am a Circuit Court 1 give us any rights. 2 by the High Court so, if you like, it is the High 3 Court that is doing the inquiry. It is because we are appointed 4 5 First of all, we know quite a bit about your company 6 and there is no point in me going through it in too 7 much detail with you, but I think the Murray Group 8 of Companies was established, 9 father; is that correct? 10 A. 11 3 Q. 12 A. I think, by your Yes it was built up by my father. Is your father dead, is he? My father and mother died in 1994, December 1995 my father. 13 14 4 Q. 15 A. 16 5 Q. 17 He was a good age when he died, was he, Mr. Murray? He was 82. And he established what was originally a car hire company; is that right? 18 A. 19 6 Q. 20 A. No, he started off in the funeral business. Did he, in fact, yes? And he moved from the funeral business and I suppose 21 in the 40's into renting a small number of cars and 22 gradually the car rental business became, more or 23 less, the main business and then we moved into the 24 car sales business. 25 Serpentine Avenue which was owned by a friend of his 26 who got into health difficulties and he bought the 27 garage off him to help his family out. 28 29 7 Q. He bought a garage in So he followed the pattern of a fairly successful 1 2 8 Q 3 4 How many children did he have, do you mind me asking? A He had nine children, one died at birth and the 5 other, my brother, died I think about 7 years ago, 6 my younger brother, Paul. 7 9 Q 8 A 9 10 Q But, if you like, there were? Five girls and three boys. I think in common with a lot of people in the 10 1970's, and I want to emphasise we are not 11 investigating this, but in common with a lot of 12 people in the 1970's, your father took certain steps 13 in the early 1970's with the coming of capital taxes 14 and that sort of thing, he made certain arrangements 15 with regard to the establishment of a Trust and all 16 that sort of thing? 17 A 18 Well, are you referring to anything in particular now? 19 11 Q 20 A Well, did he establish a Trust? What happened was we sold some properties, 21 I understand, and he established a Trust at that 22 time. 23 12 Q 24 A 25 13 Q 26 A So that was not unusual at the time? No. Do you know what the name of that Trust was or is? The Trust was the Woodward Trust, as far as I 27 understand it, and that was on the sale of 28 properties in '73. 29 14 Q We are not investigating that. 7 That is not a matter 1 really of any consequence. 2 fact. 3 Yes . 4 15 Q We are accepting that as Do you understand? So you need not worry, so far as we are concerned, 5 about that at all. 6 got his money, whatever way he got the money, it 7 makes no difference to us, and he established a 8 trust called the Woodward Trust; is that right? 9 A 10 16 Q 11 A So he established a Trust, he That's correct. And that was established where, do you know? In Jersey. I think at that time there was some 12 worry, I believe, of devaluation of the Irish Pound 13 I think. 14 17 Q 15 A 16 18 Q He deemed it prudent to do it anyway? Yes . That was fair enough. So he established the trust 17 and we have in fact the documentation and I do not 18 intend to go through that documentation with you. 19 20 I think that trusts, they operate through companies. 21 Do you know the name of the company that this Trust 22 operated through? 23 A 24 19 Q I am not sure I understand what you mean by that. When a Trust is established, you see, the Trust is 25 established and it has to operate. 26 it has to function and one of the ways it functions 27 is that there is a company attached or owned by the 28 Trust. 29 company which was attached to the In other words, Were you familiar with the name of the Woodward Trust? 1 No I don't think I know that. 2 that particular point about that, we transferred 3 those funds from the sale to Jersey and they set up 4 the Woodward Trust there? 5 20 Q 6 A 7 21 Q 8 A 9 22 Q 11 A 12 And that was my father's kind of whatever. I understand that? He dealt with that entirely. It was not part of our It was not part of the company? It was not part of the company and it was set up off-shore. 23 Q 14 But, of course, the funds had originally come from the company; isn't that right? 15 A 16 24 Q 17 18 Yes . company, if you understand what I am saying. 10 13 As I understand from They did, yes. So, to that extent, it had a connection with the company? A It did. I understand the way it was set up that it 19 did originally have, yes but the funds weren't 20 needed as I understood. 21 25 Q 22 23 Does the name Sumac Limited mean anything to you, Sumac Limited? A 24 Sumac, no I heard it, I heard it somewhere but it does not mean anything to me. 25 26 Q 26 A You did not know about it, did you? No, I should really point out that I was working at 27 the time in Esmonde Motors where I had moved from 28 Murrays at that time and I wasn't really, I didn't 29 even know the Trust was set up until recent times 1 2 3 27 Q Yes I understand that but you knew about the company 4 Sumac many years later, didn't you, you did business 5 with it? 6 A 7 8 what the actual involvement of that was. 28 Q 9 What did you understand it to be? I understood it to be. 10 11 I heard about that later, yes, but I am not sure Don't mind what You tell me what you thought it was? A I don't know how I was involved. I know that we set 12 up the Woodward Trust and, as far as I was 13 concerned, the actual money that my father put out 14 into Jersey was used sometimes for the guarantee of 15 loans. 16 29 Q 17 A 18 We will come to that later.? When it comes to Sumac, I don't really know the connection. 19 30 Q 20 A 21 22 I do not really know. You do not know anything about Sumac? I don't know the connection and I don't understand the connection. 31 Q I see. Now, when did you say you acquired a 23 position of significance within the Murray 24 organisation? 25 Well a position of significance, I was asked to move 26 to Esmonde Motors in 1968 and I was there for many 27 years. 28 selling and buying and also selling new cars that 29 was cars for our hire drive company and I got in That was a company that was involved with 1 involved in that part of the business for many years 2 and we sold the property there in Serpentine Avenue 3 to the bank, that was the early 70's and it must 4 have been five years later we moved eventually. 5 moved to a small garage next. 6 was Kinsellas on the Blackrock Road which was too 7 small for what we required and we eventually bought 8 the OK Garage in Stillorgan and I have been there 9 for -- in fact, my head office is still there but 10 I became involved in the car rental business more 11 and more through buying the cars for that car rental 12 company, and I got more involved. We We rented one which 13 14 We had a lot of people working for us. 15 of with the car rental company for many years, 40 16 years wouldn't be unusual but I got involved as a 17 main Board Director I think it was 1978. We were kind 18 32 Q 19 A 20 33 Q Yes and before that who was the Managing Director? 21 A Before that, Ray Carroll was the Managing Director 22 23 I see. When did you become Managing Director? Managing Director I think was around 91. before that. 34 Q At the time that you became Managing Director, let 24 us take that picture in the early 1990's, just at 25 that time, who were the owners of the Murray Group? 26 A 27 28 29 The owners of the Murray Group, the shareholding was, my father, of course, was the main shareholder. 35 Q Yes . 1 36 Q We will put it like this: How much did you own? 2 Forget the others for the moment. 3 did you own? 4 A 5 37 Q 6 A 7 38 Q 8 A 9 39 Q 10 A 11 40 Q 12 13 What percentage Nine per cent. You owned nine per cent? Yes . And when did that change? The nine per cent changed on my father's death. Which was in 19? 94, 95 I should say. And after that? What percentage did you own after that? A What happened was after that, my brother, Paul, had 14 died and the way the actual, my father's wishes were 15 that the girls were to get 40 per cent of the 16 company and the boys would get 60 per cent of the 17 company but that was not established. 18 to get him to actually lock-in on that at a much 19 earlier date because I was building up the company 20 and the cake was getting bigger and I was trying to 21 get him to fix the amounts and so on but eventually 22 that was done, and when my brother, Paul, died, the 23 girls were dealt with with preference shares and he 24 left his house and contents to the girls. I was trying 25 26 My father gave me 60 per cent of the company and 27 that was including the nine, now, and my other 28 brother, Noel, forty per cent. 29 1 2 death, the girls disputed the Will and my father had 3 held ten 4 for himself. 5 when he died, of course, that was in the estate and 6 there was a dispute over that and the girls were, 7 two of the girls, the other girls were advised, 8 three other girls to get involved because it was in 9 their interest. per cent for my mother and ten per cent Don't ask me why he held on to it and One decided not to and it 10 eventually ended up that the four girls got five per 11 cent each. 12 per cent of each of the girls. 13 42 Q. 14 15 Since then, we have bought out the five So the position nowadays is that you own sixty per cent, is it, approximately? A. As I speak, we are just about to sign a deal where I 16 am buying out by brother, Noel, so there is nobody 17 left other than myself then. 18 43 Q. I see. Did Mr. Carroll own a percentage of the company at any stage? 19 20 A. 21 44 Q. 22 A. Ray Carroll? Yes? Yes he had five per cent. As I understand, my 23 father passed over at some stage the five per cent 24 to him because he was with the company for a long 25 time . 26 45 Q. Are you sure it was not nine per cent because I have 27 some documents which would seem to suggest it is 28 nine per cent. 29 I could be wrong now? 1 46 Q. 2 A. 3 47 Q. 4 A. Would you check that for me? I could check that out. That would be very helpful? I know that my Uncle Anthony, who was involved in 5 the funeral business at the time, was given a 6 percentage and Ray Carroll was given a percentage at 7 some time. 8 48 Q. 9 Mr. Carroll's involvement, the dates of it where he owned X per cent and X per cent? 10 A. 11 49 Q. 12 Yes. If that was laid out to us, it would be of considerable assistance if you would do that? 13 A. 14 50 Q. Yes okay. I know these things can become very complicated down 15 through the years and you don't necessarily carry 16 them around in your head, but if we were making a 17 report, we may not mention it in the report at all 18 but if we do have to mention it, we would prefer to 19 be accurate, as you will appreciate. 20 to say Mr. Carroll had five per cent when he had 21 nine and we certainly don't want to say he had nine 22 per cent if he had five. We don't want Do you understand what I 23 24 A. 25 51 Q. 26 A. 27 52 Q. 28 A. 29 53 Q. Yes . Was Mr . Carroll a family member? No he wasn't a member of the family, no. He was a trusted employee? He was an accountant. He did move into more general management at one 1 2 A. 3 54 Q. 4 He was Managing Director. And when would he have ceased to be that then, Mr. Murray? 5 A. 6 55 Q. 7 A. 8 56 Q. 9 He retired, I think, in 1991. In the normal course of events? Yes. And your arrival on the scene as Managing Director was, if you like, following on from that retirement? 10 A. 11 57 Q. That's correct, yes. I am only just trying to get the picture. The 12 company which we are investigating is, as you know, 13 it is a company which was a subsidiary of Guinness & 14 Mahon here in Ireland and which ultimately had a 15 number of different names but if we call it 16 Ansbacher for the moment but it did not always have 17 that name. 18 it had? 19 A. 20 58 Q. You will have seen the other names that Yes. And you are probably saying to yourself, "What is my 21 connection with that company?" and I will go through 22 that with you. 23 that is where we are heading, if you like, I am not 24 taking you by surprise, I would like to just canvass 25 your company's involvement with Guinness & Mahon. 26 How long was your company doing business with 27 Guinness & Mahon? 28 29 A. But before we go through that, and I don't really know but I do know that we did 1 I wasn't really involved in the financial 2 arrangements or loans. 3 4 I was involved more in the operational side of it, 5 totally in fact, but I do know that we dealt with 6 Guinness & Mahon and obviously I knew that because 7 they used to have an annual golf outing in the 8 Castle, I used to play in it and I knew they were 9 involved in it. 10 59 Q. 11 A. 12 60 Q. 13 A. 14 61 Q. Did you negotiate anything with them? I never negotiated. Never negotiated? No I was never involved in any of it. Did you know any of the people involved in Guinness & Mahon? 15 16 A. 17 62 Q. 18 A. 19 63 Q. 20 A. 21 64 Q. 22 A. 23 65 Q. 24 Yes I knew Maurice O'Kelly. Did you know Mr. Traynor? No. Or Mr. Collery? No. You did not know them? No. I see. Now, from about 1989 onwards, that banking, right? 25 A. 26 66 Q. 27 Yes. About 1989 onwards, that arm of the banking seems to have been changed to IIB; is that correct? 28 A. 29 67 Q. Irish Intercontinental Bank? Yes? 1 Yes, that's right because I remember meeting them 2 and seeing them in Merrion Square. 3 68 Q 4 dealt with IIB directly or indirectly? 5 A 6 69 Q 7 8 I take it that from 1991 onwards, you would have I did not deal with them directly, no. But would you have been aware of the money you were borrowing from them? A 9 No the borrowings changed, you see. The money we borrowed for cars, during the early 1980's, we took 10 over a Ford dealership in 1980 and the new car 11 market at that stage was about 106,000 registrations 12 per annum and in 1981/82, the market collapsed so it 13 was not necessary to have collateral for borrowing 14 for cars because cars were not acceptable to banks 15 as an asset because the banks felt they could not 16 repossess them clearly enough, and as we moved into 17 the 1990's, the economic situation changed and we 18 were borrowing money through Ford, Ford Motor Credit 19 Bank, in which we could reverse the situation and we 20 could borrow money versus cars, if you like, so we 21 weren't really involved in that. 22 23 I have to say I would not be aware of what financial 24 arrangements were made with IIB. 25 70 Q A 28 29 You were the Managing Director after 1991? 26 27 But after 1991 you would, surely? I was, yes but we had a new accountant who dealt with loans. 71 Q And what was his name? 1 2 72 Q. 3 A. And is he still with you? He is, yes. He is our accountant and our financial 4 guru or whatever. 5 around that time. I think he joined the company 6 7 Sorry, I think I am wrong in that. 8 he joined the company in 1991, I think he joined the 9 company around 1995. I do not think Ray Carroll would have been 10 still involved with the company even though he moved 11 from MD, he moved to advisor, company consultant. 12 73 Q. What I am going to show now, Mr. Murray is this. 13 am going to show you a Guinness & Mahon statement, 14 page 206 Exhibit I. I 15 16 Now, I am going to show it to you because of certain 17 information which is contained in it. 18 if you like, it does not show any connection with 19 the company which we are investigating but I will 20 explain that to you later? 21 A. 22 74 Q. 23 24 (Handed) Okay. It is helpful for me in understanding the full picture? A. 25 This is a Guinness & Mahon Sterling Account. is 1980? 26 75 Q. 27 A. 28 76 Q. 29 Even though, 1980, all right? Yes. Now, you will see that it is an account which This 1 2 A. 3 77 Q. Sorry? It was for a particular customer, if you like. The 4 customer was not Guinness Mahon (Jersey). I 5 the customer was the Murray Group in one guise or 6 other? 7 A. 8 78 Q. 9 think Yes. There is nothing wrong with that, I am not making any suggestion there is. But you will see a number 10 of things arise with regard to that. 11 in March 1980 to "H.T. Murray College Trustees 12 Jessica Trust, £91,100." You will see 13 14 Now, can I take it that the "H.T. 15 Murray"...(INTERJECTION)? 16 A. 17 79 Q. 18 A. 19 Sorry, "Transfer into H.F. Murray". "H.F. Murray" is first, yes? "28th March 1980 transfer to H.T. Murray College Trustees". 20 80 Q. 21 A. 22 81 Q. 23 A. 24 82 Q. 25 A. 26 83 Q. 27 A. 28 84 Q. 29 A. Who is H.F. Murray? That is my father. All right. Do you know anything about that? No. Do you know anything about Jessica Trust? No. Did you ever hear of Jessica Trust? Never heard of it. Look at the next entry? "A.P. Murray"? 1 2 3 8 6 Q. MS. MACKEY: "H.T. is the next one? 4 87 Q. JUDGE O'LEARY: "Transfer to H.T. Murray"? 5 A. 6 88 Q. 7 A. 8 89 Q. 9 A. 10 90 Q. 11 A. 12 91 Q. 13 A. 14 92 Q. 15 A. 16 93 Q. 17 A. 18 94 Q. 19 A. 20 95 Q. 21 A. Sorry, I thought you said that? No I didn't, I said "H.F. Murray"? "H.F. Murray", that is my father. The next is "Transfer to H.T. Murray"? Yes, £81,990. Yes? Yes. And something to do with a Delisle Trust? Delisle Trust. Yes. Is that you? Never heard of it. Is that you? I have no knowledge of that at all. Is that you? H.T. Murray is me, yes. Did you get £81,990 directly or indirectly in 1980? I would say I could have but I don't recall. I know 22 that year I bought a house. I sold my house in 23 1979/80, the very end of 1979 in Kill Lane, which is 24 where I lived, for £100,000 and I bought another 25 house in Carrickmines for £164,000 and I borrowed 26 £100,000 from the bank. 27 96 Q. 28 A. 29 Which bank? I don't know why or I will have to check what that was because any money that I got...(INTERJECTION). 1 97 Q I know you strike me, Mr. Murray, with respect, as 2 a very modest man. 3 man or anything like that? 4 A 5 98 Q Some people may have a different opinion you know. But if you got in 1980 £81,000, almost £82,000, you 6 would not forget it. 7 to you? 8 A 9 You are not a flashy life-style That is the point I am making That is not necessarily so because when I -- the way I ever got money was from the company. It might 10 have been a loan from the company or a bonus or 11 something at the end of the year. 12 99 Q I understand that of course. 13 A And even when I got married, I mean my father gave 14 me in 1963, £6,000 and he never handed it to me 15 himself. I got it from the accountant in the 16 company. We did not have that kind of relationship. 17 So the money that would be there, obviously it went 18 through the books of some kind or was transferred 19 into...(INTERJECTION). 20 100 Q 21 the next one? 22 A 23 101 Q 24 A 25 102 Q 26 A 27 103 Q 28 29 I might help your memory because I will now go on Yes . The next one is "A.P. Murray"; is it? Yes . Who is "A.P. Murray"? My mum, Ann Patricia, yes. And "Bianca Trust", do you see that, as Trustees for the Bianca Trust"? "for Trustees 1 104 Q 2 A 3 105 Q 4 No I never heard of that. And do you see the next one now, "Pay to Ray Carroll"? 5 A 6 106 Q 7 Yes . Ray Carroll, we know, was an important person within your organisation at that time and he got £50,000? 8 A 9 107 Q Yes . Would that not in its entirety seem to suggest that 10 some kind of a divi up at that time: 11 got so much, you got so much, your mother got so 12 much and Mr. Carroll got so much? 13 A 14 108 Q 15 Yes. Your father When you say "a divi up". Where did the money come from is what I am asking you? 16 A 17 109 Q 18 Guinness & Mahon (Jersey). I know that is where it came from, but I am talking about did it come from the Woodward Trust? 19 A 20 110 Q I do not know. I will tell you why that becomes very relevant when 21 I show you the next two or three documents. 22 to know where that money came from. 23 care why you got it. 24 paid on it or not, it is nothing to do with me, but 25 I am interested in where it came from because that 26 is necessary for the investigation of the company in 27 circumstances which I will explain to you later. So 28 I need to know where that money came from and could 29 you enquire about that? I need I really don't I don't care whether tax was 1 2 111 Q 3 A 4 112 Q 5 A 6 113 Q Absolutely we will give you a copy of that. Okay. We will get another copy for you? Thank you. I want to make it clear that right up to this point, 7 there is no connection with what I would call the 8 Cayman Islands, Ansbacher (Cayman Islands) even 9 though the money in question ultimately, I think, I 10 would be able to show to your satisfaction in the 11 Woodward Trust ended up in the Cayman Islands? 12 A About 2 years ago when the Ansbacher thing came into 13 the papers, 2 years ago when that was announced, 14 have to say, I can quite honestly say that that was 15 a bombshell and my father's name was printed in the 16 paper with that because I had never heard of 17 Ansbacher before and neither had he or anybody else. 18 114 Q I I think Miss Mackey will confirm that quite a number 19 of people who have been genuinely trying to help us 20 find themselves in the same position. 21 enough. 22 that the person in question, it may be your father, 23 I am not saying it was your father, but whoever was 24 involved in the setting up of the Trust? 25 A That is fair But the reality is that what happened was Yes . 26 If you like, entrusted certain individuals with 27 regard to their money and there was nothing 28 improper, there wasn't money being taken or anything 29 like that, but that person was given wide authority 1 to move the money around and ultimately it ended up 2 in the Cayman Islands? 3 Okay. 4 116 Q 5 That is the problem and that is why a lot of people are coming into us, do you understand? 6 A 7 117 Q Yes . Not because they know it themselves but because the 8 fact of life is that Guinness & Mahon, through Mr. 9 Traynor or otherwise, ended up in a situation where 10 the money ended up in the Cayman Islands and it 11 ended up in the company we are investigating, 12 unfortunately for you. 13 I am making? 14 A 15 118 Q 16 Do you understand the point Yes . What I would like to show you then about that is I would like to show you number 282. Exhibit 2. 17 A 18 119 Q (Handed). Again we will give you a copy of this if you want it 19 in due course. 20 with that? There is no problem or difficulty 21 A 22 120 Q Does the name College Trustees mean anything to you? 23 A I have to say I heard of College Trustees all right. 24 121 Q 25 I think what College Trustees did is, I think they managed the money out in the Channel Islands? 26 A 27 122 Q Yes . Would you think that is a fair summary of the position? 28 29 The College Trust. A 1 123 Q 2 A 3 124 Q Yes . But what happened, right, is that College Trustees 4 in managing the money had wide powers, College 5 Trustees now was a creature of Guinness & Mahon as 6 well, they had wide powers where to put the money. 7 Sometimes they put it one place and sometimes they 8 put it another. 9 you will see, do you see "GMCT", do you see that up 10 But if you look at 282, Exhibit 2, on top? 11 A 12 125 Q "GMCT" Guinness Mahon. Cayman Trust. That is one of the names of the 13 company we are investigating. Ansbacher came in 14 afterwards, but that is one of its names. 15 16 This is a Guinness & Mahon document and I am sure 17 Guinness & Mahon will confirm it to you if you wish 18 but College Trustees opened an account in Guinness 19 Mahon (Cayman Trust) and in September 1987 Sumac, do 20 you see Sumac there, S-U-M-A-C, Exhibit 2? 21 A 22 126 Q 23 A 24 127 Q 25 A 26 128 Q 27 Yes . Sumac had Deutsch Marks at that time? Deutsch Marks, yes. Did you know that at the time? No. It is a fact. You can take it that it is a fact that it was there. 28 A 29 129 Q Do you understand? Yes . So that is the first thing. 25 The second thing I want 1 to show you is one of a number of sheets of paper 2 which I have which even make the thing more clear, 3 number 283, Exhibit 3. 4 A. 5 130 Q. (Handed). Do you see it is a Guinness & Mahon statement like the first statement I showed you, Exhibit I? 6 7 A. 8 131 Q. 9 Yes. Except this time the money has gone through Cayman because the customer of Guinness & Mahon in Dublin 10 is Guinness Mahon Cayman Trust/College. You can 11 take that means College Trustees Re Sumac? 12 A. 13 132 Q. Yes. And that means in 1986, Sumac, which was the company 14 which was the operating company of Woodward Trust, 15 had £1.421 million Sterling. 16 Sterling account in the Cayman Islands. 17 133 Q. 18 A. 19 134 Q. MS MACKEY: I think there was a Deutsch Marks? Deutsch Marks, is it? JUDGE O'LEARY: I do not see where that is written actually. 20 21 MS. MACKEY: It is written on the top. 22 JUDGE O'LEARY: It is indeed, Deutsch 23 Marks. 24 A. 25 135 Q. 26 A. 27 136 Q. Do you see that? Yes. Now, did you know anything about that? No. And where did you think the money was, because 28 I know the money came back in 1994 and we will go 29 into all that later, but where did you think it was? 1 As far as I knew, Jersey was the only word that we 2 used, the money was in Jersey. 3 137 Q 4 5 Do you understand? A Whether it was or not, as far as I knew, the money was Jersey money or whatever. 6 7 It was being controlled in Jersey. 138 Q I understand. So you see there where there was this 8 money and it is clearly money that Sumac had an 9 interest in. Forget who owed Sumac that. It is not terribly important just for the moment. 10 11 12 You can take it, Mr. Murray, that I have many other 13 similar examples but they all come down to precisely 14 the same? 15 A 16 139 Q Yes . So I think unless you can come up with an 17 alternative explanation for it, I think you can take 18 it that you are going to have to come to terms with 19 the fact that the money was in the company we are 20 investigating. 21 A 22 140 Q Well, I Do you understand? — There is nothing wrong with that, I can say to you, 23 but the reality is one of the jobs the High Court 24 has asked us to do is to find out who the customers 25 of the company were. 26 report, unless we get another explanation, that 27 Sumac was one of the customers of Ansbacher. 28 understand? 29 Now, we certainly will have to Do you 1 141 Q Now, what I am saying to you is, if you have any 2 other information which would contradicts that, by 3 all means tell us. 4 A 5 142 Q Do you understand? I wouldn't have any information. I am just going to leave it like that for the moment on that part of it? 6 7 A 8 143 Q 9 Yes . Now, one of the things which we are going to have to do then is we are going to have to find out who Sumac were, all right? 10 11 A 12 144 Q Yes . We know that Sumac were a company which was the 13 operating arm of the Woodward Trust. 14 find out then who the Woodward Trust was and prior 15 to the money coming back in 1994, and I will deal 16 with that separately later, prior to that now, if I 17 was to ask you in 1991 who owned the money which you 18 thought was in Jersey, what would you have said? 19 A 145 Q 22 23 My father dealt with it whenever he had to, I suppose. 20 21 My father. We have to So you would have thought your father could have done what he wanted with it? A Yes, absolutely. It was not something that was 24 discussed ever because I can say if he brought money 25 back or gave it to anyone, I was not privy to that 26 knowledge. 27 As far as you were concerned, he was the man who had 28 control of that money? 29 1 147 Q 2 A 3 148 Q January 1995. Between 1991 when you took over as Managing 4 Director, and I know it is a gradual thing, I know 5 you don't just go in one morning and say "I am the 6 Managing Director", that's not the way it is done. 7 I have been around business long enough to know the 8 way that family business is operated, it is a 9 gradual transfer? 10 A 11 149 Q Yes . So you would have naturally thought that your father 12 had the power and control over that but at some 13 stage that changed? 14 A Yes. No, it did not change until I think he decided 15 to bring it back when the Amnesty was announced and 16 that was, as I understood, what had changed. 17 150 Q 18 But when the Amnesty was announced, percentage meaning nothing at the moment now? 19 A 20 151 Q 21 Yes . We will go into those later, but you got a big percentage of it? 22 A 23 152 Q Yes . So at some stage it did change. At some stage 24 somebody said, "Well if it was your father's money 25 and it became your money, you got a very substantial 26 gift from your father"? 27 A Well, when he set up the Trust, whatever way he set 28 up that Trust, I don't know. 29 You can take it that there is nothing in the Trust 29 1 that would have said you would get forty per cent of 2 the money or fifty per cent of the money? 3 I have no idea whether there was or not. 4 set this Trust up and he decided...(INTERJECTION). 5 154 Q 6 A 7 155 Q 8 A 9 156 Q Whether he Do you have the Trust document? No. Have you ever seen the Trust document? No. You can take it from me I have seen the Trust document. 10 11 12 Miss Cummins indicates to me that in fact as part of 13 your affidavit to the authorised officer who was an 14 official investigating the company, you exhibited 15 the Trust document as part of your affidavit. 16 I know you might have forgotten it, I am not making 17 a big issue of it, but you can take it that in the 18 Trust document which you have had access to, you 19 were not named as a fifty per cent beneficiary. 20 you understand? 21 A 22 157 Q Do Okay. It is all the children and variable. You know the 23 usual kind of nonsense that people go into in these 24 documents, you understand that? 25 A 26 158 Q Yes . But somebody decided that this very deserving young 27 man at the time, Mr. H.T. Murray, was not entitled 28 to the same as all the rest of his siblings but he 29 was entitled to forty or fifty per cent. All I am 1 asking you to find out is when that decision was 2 made? 3 A. 4 159 Q. How can I answer that? I don't know because I don't know what went on. 5 When the money came for the Amnesty, your father was 6 an elderly man at this stage? 7 A. He was still involved in business in so far as he 8 was in every day, I should say, but when that 9 decision was made, I don't know. 10 160 Q. Would you show Mr. Murray a letter dated 4th January 11 1994 from Irish Intercontinental Bank to Kredietbank 12 in London, Exhibit 4? 13 MS MACKEY: 14 A. 15 161 Q. Page 193. (Handed). JUDGE O'LEARY: 16 You can see down there it talks about your account 17 in general and the second last paragraph: 18 "On receipt of the above funds, the amounts will be transferred into four individual deposit accounts with IIB in the following proportions: Harold T. Murray, 50%; Noel G. Murray" -- (who is your brother) -- "31%; Harold F. Murray" -- (who, I think, was your surviving father at that stage)? Yes. 19 20 21 22 A. 23 162 Q. 24 A. 25 163 Q. "And Ray Carroll 9%"? Yes. Did that reflect at that time your interest in the 26 company approximately or how was that percentage 27 arrived at? 28 A. 29 164 Q. I don't know. I see? 1 Unless it was in proportion to the way the 2 shareholdings were held but the shareholdings 3 changed. 4 165 Q 5 I never saw that before. I am not saying you saw it but you know you got fifty per cent of the money? 6 A 7 166 Q 8 A I expected I would get more than Noel. 9 167 Q Because you owned more of the company? 10 A I see. Did you know that you got more than Noel? Yes, well I was not sure what way he would have broken it up. 11 12 I did not know what percentage of the money. 168 Q Does that not lead to the inference that the money 13 was really the company's because it was being 14 divided in accordance with your interest in the 15 company? 16 A Yes, I suppose, but my interest in the company, my 17 mother was there with a ten per cent shareholding of 18 the company and she is not featured there at all. 19 don't understand those percentages. 20 169 Q MS MACKEY: 21 22 Did your mother not die in 1994 you told us, I think? A 23 24 My mother died at the end of 1994. This is 93, is it not? 170 Q JUDGE O'LEARY: 25 Yes, this is 4th January 1994. But am I not right 26 in saying that, for instance, your sisters aren't 27 mentioned at all in that? 28 29 I A No they had been dealt with at that stage. 1 Yes . 2 3 172 Q But they had not been dealt with unless some money 4 which was out in Jersey or Cayman or whatever it 5 was, unless that was owned by the company as well. 6 Can you see the problem? 7 A I have to say that my father really dealt with this account most of the time. 8 9 173 Q 10 A And he decided? But my sisters now, this was before my father died. 11 My mother died at the end of 94 and my father died 12 in 95 . 13 174 Q 14 But, you see, your sisters are not mentioned in that at all? 15 A 16 175 Q 17 No because they were not part of the company then. It was reflecting your interest in the company approximately without being precise for the moment? 18 A 19 176 Q It was but I was not aware of that. I understand that. Could I ask you this: Did you 20 declare, I am not really interested in your tax 21 affairs, it is nothing to do with me. 22 interested in it in so far as it might give the 23 information with regard to the ownership of money, 24 that is the only thing that we are interested in. 25 don't care whether you have over paid your tax or 26 under paid your tax, it is nothing to do with me? 27 A I am only Yes . 28 But I am interested about the fact that you did 29 actually avail of the Amnesty? I 1 2 178 Q 3 understand? 4 A 5 179 Q Yes . And if it was a proper Trust, it did not need to avail of the Amnesty? 6 7 Now, if the Trust was properly set up, do you A That is correct because at the time there was a 8 discussion whether or not we needed to avail of the 9 Amnesty because all the legal advice that we had was 10 that maybe we don't because our discussion was that 11 the money was legally put out there and 12 180 Q -­ The problem was that while it was legally out there, 13 it might be illegal to bring it back or it might 14 give rise to a tax liability to bring it back? 15 A The tax situation changed several years after we had 16 put it out there. 17 thought it was better that we avail of it. 18 181 Q 19 A So when it was brought back, they Who advised you on the Amnesty? It would have been KPMG. They would have actually 20 dealt with my portion or whatever I was to get which 21 went into the company. 22 because the company needed it. 23 straight into the company. 24 182 Q 25 I did not get it personally The money went I understand that, but it came in by way of loan or loan shares or something? 26 A 27 183 Q Yes . Now, do you know, Mr. Murray, that for many years 28 the company had been borrowing money on a 29 back-to-back basis? 1 2 184 Q Yes ? 3 A Yes . 4 185 Q 5 A It had been doing that with Guinness & Mahon? Well I was not aware that Guinness & Mahon were 6 involved, although I am sure that they were, but I 7 was aware of Irish Intercontinental Bank because, as 8 I said, the motor industry at that time in the mid 9 80's was difficult. 10 186 Q What I would like to show you is a memo which is dated and it is page 227 to 231, Exhibit 5. 11 12 A 13 187 Q (Handed). This is an IIB memo and this is a credit 14 application. 15 documents that we have. 16 which is the second page of that, IIB make the 17 following statement, "Proposed Security". 18 see that there down at the bottom of the page? 19 A 20 188 Q 21 A 23 189 Q 24 A 26 190 Q 29 Do you "IIB facilities secured"? No, the term "Proposed Securities". Have you page Yes . Look at the bottom of that page, "Proposed Security"? 25 28 If you look at page 228, 228? 22 27 It is only typical of many such Yes . "The term loan will be secured for principal only by a bank guarantee accepted by IIB. This will be provided on behalf of a Trust controlled by the shareholders of the company, who have a deposit of a similar amount." 1 2 Is that a fair reflection of what the position was 3 at that time? 4 that is all it, is what the Bank says? 5 That's correct. 6 shareholders of the company, the company being 7 Murray's you are talking about. 8 191 Q 9 A I mean, it was controlled by the Yes . That is what we used to guarantee the loans at that time for money we borrowed for. 10 11 That is what the Bank is saying and 192 Q The only other matter that I want to talk to you 12 about before moving on probably less contentious 13 matters is of all the discussions we have had so 14 far, only one really has led to a disagreement and 15 it is this, that we have information, and you have 16 seen one document which is the bank statement, 17 Exhibit I? 18 A 19 193 Q Yes . Which refers to other Trusts, being the Jessica, the 20 Delisle Trust, the Bianca Trust and finally a Trust 21 called Kodier, C-O-U-D-I-E-R,I do not know how you 22 pronounce it, which I think was connected with Mr. 23 Carroll. Do you know anything about those? 24 A 25 194 Q 26 A 27 195 Q Absolutely nothing? 28 A Absolutely nothing. 29 196 Q No. Nothing at all? No. And specifically about your own one and I am using 36 1 that in inverted commas now for the moment the 2 Delisle, D-E-L-I-S-L-E? 3 No, I know nothing about that. 4 197 Q Fair enough. I am going to give you an example of 5 the Guinness & Mahon borrowings, do you understand? 6 I know you do not know much about them but as, if 7 you like, the main man in the company it would be 8 unfair if I did not give you the opportunity of 9 commenting on it. 10 11 So I wonder if you would go to page 296 and would 12 you bend down the top because it has nothing to do 13 with this matter. 14 but I want to take the top off it because it is 15 nothing to do with you, it is different. 16 minutes of a credit minute in Guinness & Mahon and 17 you can see that at that time "Murray's Europcar", 18 Exhibit 6 . 19 A 20 198 Q 21 A 22 199 Q We can give you a copy of this These are (Handed). Do you see that there? Yes . They had these Credit Committee meetings and 23 everybody was discussed at it and you were one of 24 the people discussed at it under the heading of 25 Murray's Europcar: "Murray's Europcar are borrowing £170,000 for working capital, rate 15%"? 26 27 28 29 A 1977 . 1977. You see there the words "suitably secured", 37 1 "Suitably secured", yes. 2 3 201 Q You can take it that we have evidence from Guinness 4 & Mahon that that word was a code they used 5 themselves which meant that they were backing 6 deposits. 7 A 8 202 Q 9 Do you understand? Yes . Where they wanted to avoid saying, "This person had backing deposits", they used "adequately secured" or 10 "suitably secured" as a code word. 11 saying in 1977 this loan was backed by money and you 12 have no reason to doubt that? 13 A So they are No, any money that we would have borrowed, maybe not 14 all of it, but we secured it against our -- my 15 father actually guaranteed the loan through the 16 money he had obviously in Jersey. 17 the time right up to...(INTERJECTION). 18 203 Q That happened all Can you see the problem that arises? You can take 19 it I have a dozen other examples, all right, which I 20 won't put to you because they are all the same and 21 you have been very fair with you us and we 22 appreciate that. 23 24 Now, the problem, as far as we are concerned, with 25 that is that nowhere in your accounts that we have 26 seen is there any record that the loans you have 27 taken out are secured by back-to-back deposits. 28 Certainly there is no reference to that until well 29 into the 90's. Do you understand and we would like 1 2 3 204 Q 4 A 5 205 Q Oh, yes, you can take it that there should? There are guarantees you have to put in. You are supposed to give a full record, do you 6 understand, so that everybody who looks at them 7 knows what the position is. 8 you to do is, if you would not mind, I would like 9 you to consider that and you may wish to take legal Now, what I would like 10 advice on it. 11 there is no difficulty with regard to that, and I am 12 not asking that you should answer the question now, 13 if you like, but if there is anything you wish to 14 say to me about it, feel perfectly free to write 15 into me about it? 16 A If you do by all means of course, Well, all I can say really is it would be reflected 17 in our accounts that the money was transferred out 18 when they did it in the 73 period, but as regards 19 the loans -­ 20 206 Q 21 22 sheet. A 23 24 If it was company money, it should be on the balance Can you see the problem? I can't say why they were not. I can't answer that question. 207 Q You see, Mr. Murray, when it was moved out, if it 25 was genuinely moved out of the company, it was no 26 longer company money? 27 A 28 208 Q 29 No longer company money, that is correct. Now, if it came in, if you like, through a back door by you using back-to-back facilities, that should 1 have been made clear in the company records and one 2 of the things that we are required to do is if 3 during the course of investigation of the company, 4 which is the banking company, we come across exact 5 accounts of where the company, which is the banking 6 company, gave information or other companies acted 7 in a way which was potentially illegal, that we may 8 have to report on it. 9 A. 10 209 Q. Do you understand? Yes. We will be writing to you formally about this but 11 I think it is only fair that I should say to you it 12 is a concern to us at the moment, not specifically 13 only with regard to your company but that the whole 14 question of the back-to-back facilities were hidden 15 from view for over 20 years as far as anybody 16 looking at your accounts is concerned, and of course 17 we will, in due course, be asking you, have you any 18 comment to make on that? 19 warning in advance that you might go away and think 20 about that and I am glad you have your solicitor 21 here who can take a note of it and he can advise you 22 accordingly and make any representations you want to 23 us about it or make no representations. 24 matter entirely for yourself. So I am giving you fair It is a 25 26 You see, I am going to give you as an example of 27 that, it might be good if you took this away with 28 you, a page 178 and this is only one example of a 29 number, and this is in 1989 before you became 1 Managing Director but it is related to your company 2 and I have to put it to somebody, Exhibit 7? 3 (Handed). 4 210 Q That is an offer from the Irish Intercontinental 5 Bank to your company for a loan of Stg £700,000. 6 Now, you can take it that that was cash-back loans. 7 As you said yourself, they were all a cash-back 8 loan. 9 the back-to-back facilities? 10 A It does say the security there, "security.... in a manner acceptable to IIB". 11 12 The offer letter to you makes no reference to 211 Q Well I think we all the know the difference between 13 a truth and a whole truth. 14 this, it is at least economical with the truth, if 15 you understand? 16 A 17 18 Will we put it like I don't think we were deliberately trying to hide anything. 212 Q It is not your document, Exhibit I, but I am saying 19 to you, that is typical of the way the business was 20 done? 21 A 22 213 Q Yes I see. Do you accept that, that that was typical of the 23 kind of short-hand that was used to hide the fact 24 that there was a specific back-to-back facility? 25 Well, is there something incorrect about a 26 back-to-back facility, because obviously the bank 27 have to have some kind of security and, as far as I 28 was aware, the money that was in Jersey was legally 29 over there and the bank, well you have to give them 1 some security other than motor vehicles or whatever, 2 so that is why we used that. 3 that was illegal. 4 I am not saying it is illegal, that is a different 5 matter altogether. 6 Mr. Murray, and you had better take legal advice on 7 this because you may wish to make representations, 8 one of the problems we have on this is that, on the 9 one hand, you send money out to a Trust, whether it I was not aware that You see, one of the problems, 10 was you or your father, it does not matter at the 11 moment, it is somebody within the company, sends 12 money out to a Trust. 13 of that money because it has now gone into the Trust 14 but in reality they have control? 15 A 16 They no longer have control I would have thought my father would have had control of the Trust. 17 215 Q 18 A At all relevant times? I would have understood that he decided to do 19 whatever he wanted to do so he wasn't giving the 20 money out to Joe Bloggs who wouldn't go through 21 everything, you know? 22 216 Q I understand. I am not going to go back even though 23 I have a note here with regard to what appears to be 24 withdrawals for yourself, your father, your mother 25 and Ray Carroll of £91, £81, £91 and £50,000 but I 26 think you are going to come back to me on that. 27 have that copy there, have you, Exhibit 4? 28 29 A You Yes I have a copy of it. We normally take a break but we are almost finished 42 1 I am fine, yes. 2 3 218 Q 4 A 5 219 Q And there is a cup of coffee or tea there? Thank you. Could I show you at page 217, I am going to give you 6 a copy and to a certain extent now I am asking you 7 to account for the potential sins of others but as 8 part of your company, if you like. 9 signed by Mr. Carroll but it is your company's name. I know it is You can see the problem there, Exhibit 8 . 10 11 12 This is a letter sent by one of your company's 13 signed by Mr. Carroll which says: 14 "I wonder would it be possible to omit item 3 in the letter to Stokes Kennedy Crowley confirming the amount of the loans at the end of the year." 15 16 17 You can take it that item number 3 is dealing with 18 security. 19 20 If you give, Mr. Murray the following document as 21 well because that is necessary for a fuller 22 understanding as to what was asked. 23 218 and 219, Exhibit 9? 24 A 25 220 Q (Handed) 92 and this is 93? Yes at the time when you were the Managing Director 26 of course. 27 Director of the company? 28 A 29 221 Q That is pages Mr. Carroll must have been still a He was involved. I must check those dates. 1 2 222 Q 3 It did strike me as a little odd. I do not think he went out quite immediately? 4 A 5 223 Q No he didn't, no. I am going to assume for the moment, unless I know 6 to the contrary, that he was still involved on that 7 date and he was writing on behalf of your company 8 and was effectively saying "hide the security"? 9 A 10 224 Q 11 A 12 225 Q Okay. Have you any comment to make on that? No. Would it be fair, Mr. Murray, or unfair, finally as 13 far as I am concerned, Ms. Mackey may have other 14 questions, but would it be fair to say, I know we 15 have already gone into the question of who 16 controlled the money when it went out to the Trust 17 and you said it was your father, I understand all 18 that, but would it be fair to say that at some time 19 immediately prior to the money being repatriated for 20 the Amnesty, that discussions were held between 21 yourselves and the accountant with regard to the 22 matter? 23 A 24 226 Q 25 A 26 227 Q 27 28 29 Yes . That would be quite normal? Yes . Do you remember who was involved in those discussions? A No because I wasn't involved directly. I was not involved in the discussions of that but when I was 1 advised I was a beneficiary, I was told that I would 2 be advised on the Amnesty and to do something but I 3 was not involved in the discussions as to how or 4 what at that time. 5 228 Q Who would have advised that you had better do 6 something because you were going to get money out of 7 it? 8 A 9 My father would have said, "We feel that we should avail of the Amnesty" and he would have said or 10 advised that we are going to avail of it in order to 11 bring it back and put it into the company. 12 229 Q 13 A 14 15 Yes . I have to say I was not aware of the percentages at the time. 230 Q 16 Would Mr. Carroll have been involved in those discussions? 17 A 18 231 Q Yes . So you would think from a practical viewpoint it 19 would be Mr. Carroll and your father and Stokes 20 Kennedy? 21 A 22 232 Q 23 A Correct. Would Noel have been involved in it? No, he would not have been involved in it actually 24 because he was not -- I think he was a main Board 25 Director at that point. 26 233 Q 27 A 28 234 Q 29 A Would your mother have been involved in it? No. Did your mother have any say? 1 Would it be fair for us to assume that in so far as 2 that generation is concerned, that the control of 3 anything of that nature rested with your father 4 rather than your mother? 5 A 6 236 Q 7 A 8 237 Q 9 10 My father really, everything yes. Rather than your mother? Yes . She would have taken a back seat in those sort of things ? A Totally. 11 MR. MURRAY WAS EXAMINED, AS FOLLOWS, BY MS MACKEY: 12 13 14 238 Q MS. MACKEY: I have just one question, 15 Mr. Murray. 16 17 Judge O'Leary asked you about the four other Trusts 18 whose names were mentioned and they were all 19 unfamiliar to you. 20 have a Trust yourself in either Jersey or Cayman? 21 A 22 239 Q 23 A 24 240 Q 25 A 27 241 Q 29 Did I have a Trust? Yes? No. Or your brother or any other member of your family that you know of? 26 28 But can I ask you this, did you Not that I am aware of. Thank you. JUDGE O'LEARY: Would you do us a favour 1 asking you to do it in respect of anybody else 2 because that is unfair? 3 Yes . 4 242 Q I wonder would you write to College Trustees and 5 would you ask them, have they any information on the 6 Delisle Trust, will you do that? 7 A 8 243 Q 9 Okay. Because if we write to them, they will just say, "Mind your own business" and we can go to Court and 10 we can get it properly through the Court but that is 11 a long, expensive, and fairly time-consuming 12 process? 13 A 14 15 I never dealt with them directly but I will write to them. 244 Q 16 I understand that. We are not interested in the details of the Woodward Trust? 17 A 18 245 Q They do not know me. I understand that and if they write back and say 19 "Mind your own business", we can't do anything about 20 that but I think you could point out to them, you 21 could send them a copy of the bank statement that we 22 have given you which shows your interest in it? 23 A 24 246 Q Yes, and you want to know about this Delisle Trust. That is the only one I am interested in at the 25 moment because the others have to speak for 26 themselves. 27 Carroll or your brother who, unfortunately, is 28 deceased; is that right? 29 I cannot ask you to speak for Mr. 1 247 Q 2 A 3 248 Q 4 He is, yes. But he is not deceased but your other brother is deceased? 5 A 6 249 Q My other brother is dead. And your father. I am not asking you to account for 7 them. 8 involvement in the company. 9 their own personal business, that is their own Obviously I have to ask with regard to their But with regard to personal business and it is nothing to do with you. 10 11 So, I wonder, would you do that for us? 12 13 A 14 250 Q Okay. It would be considerably helpful. Is there anything 15 else? 16 MS. MACKEY: No. 17 JUDGE O'LEARY: Thank you very much. What 18 happens now is actually 19 very simple. 20 been taking a careful note of everything we said. 21 That will be reduced into a transcript form and you 22 will be asked to sign the transcript just to say 23 "yes that is what happened". 24 A This lady over here in the corner has I am sorry if you think I was in any way unhelpful 25 but, as I said, in running the company and kind of 26 moving up through the ranks I was not that involved 27 with the financial end, whatever, in detail. 28 Mr. Murray, I did not form the view that you were 29 unhelpful at all. 1 it be true to say that 2 3 Mr. Carroll was the person most involved in the 4 financial end of the company? 5 A There was arrangements of loans and cash loans. 6 7 With the company, yes. 253 Q And he would have had a good knowledge of the 8 company's finances and how it conducted its 9 business; isn't that so? 10 A 11 254 Q So. JUDGE O'LEARY: And would have been your father's financial 12 advisor? 13 14 A My father was there every day up to some months 15 before he did. 16 dominant personality. 17 255 Q He used to go in and he was a very And you know the way these dominant personalities 18 gather around them people who carry out their 19 wishes, if you like? 20 A 21 256 Q People who advise them, yes but he did not. Would Mr. Carroll fall into that category or was 22 there a friendly relationship or was it purely a 23 business relationship? 24 A 25 They worked together for years. 26 257 Q 27 A 28 258 Q 29 I would say there was a friendly relationship there. What age is Mr. Carroll now? Ray is now, say, 75. MS MACKEY: Just one other question, 1 2 Austin, no. 3 other brother. 4 JUDGE O'LEARY: 5 No, Paul was my brother and Noel is my Thank you very much indeed. 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED KSQS ?gs.sz 14/02,? of?ng/ya? {fr/(n7 9 WIWHII 4«M«M l>UM«tCf U». «IN CB. ■ _ '•. 1 ilkVLINS ' IWHI «m C«. led ge r AMCI OiOUMT roiUAIt OF.niuiio ITOALIHIUI lllflf I S4HMI0 ’IMatO iM I lO y»a»»«n IUUN . „• \ ■ ?* ■ **’ M B w i k 'w w l * 9 • ♦'•*/ "• *. " « » U t » / • * / » * ............. f/ •I nmnrMi W H IM mk ' ^ GUINME S S + M A H O N U P * trcrthginwm T* to «r miaiAV dm cillcm t/i l i» i / m * -• 9,«oo.oo 11HAS10 ro m u l l nnav i n i io if MMMI »1,100,00 ra t 1 jo,o a a .o d - • *1*100.00 u»-« «r .VQ-ri rar to »i mmwt p u cmxicf ret a ir/nts to* m iuihi »au»i i • PH IMIHt AT .*010 itr io tr nnitt na tou tits m r m u ru t thi ijanca i •* 1«11«9-«l A* .9010 ]IMU< m to pic Cfu. m f r w i n r * r TUf- CMMiM- m P»* M M M 4 11 .VU10 31IUIIBO IKTMCST *,*00.41 . • ' • • I HjIW.BO “ «* l> w «.*a M «,tA 0 .S V M K. I : 1. asw w II f \ r *.••3 NfM pgpfflKH 06040018 09040130 00040189 00040117 r Saaaai ito* *4fr M O M M M « DJM. 1»t11i31T«00^ U80 8um*s Itfr* 00040840 * 00M7741 L i 110*80.71 C€J\ uS D.M. 7«n,*17.7« * J 1 « C S O .O O • i • ! / 4**. • «v— •.* .*?••.* ’ CT««* ** f •t• r • I i i KredietfaankNVLondonBranch, Exchange House - 7thFloor, . Primrose Street, London EV2A2HQ. ^ R « \ Sum ac Investm ents Lim ited/M urrays Europcar Lim ited/Esm onde M otors Limited. : . Sirs, . ■ We referto our letterto you of 28 May 1993 in connbctionwith SumacInvestments Limited/Murrays EuropcarLimited. Weherebyconfirmthat it is in orderto transferthe full balance on deposit account number40349002 to ouraccount in Royal.BankofScotland.. account IrishIntercontinental BankLimited. We understandthat the balance on this account is circaGBP922,6o6. .... ..... .............. • *............................... . . ...... We also referto ourletter to you of28 May 1993 in connectionwith SumacInvestments Limited/Esmonde Motors Limited. We confirmthat it is in orderforyou to transferthefull balance on deposit account number40349001 to ouraccount at KredietbankBankvereinBremen - account number5000971910 - account IrishIntercontinental Bank Limited. Weunderstand that the balance onthis accountis circaDM1,142,000. _....... „ ... ................ . . v.;£mts.withHBin thefollowingproportions, HMd.lVMra " -ia&IdF.Munay-10% andftayn^d C a r r o l . / ' l « * _ ...... G. Murray-31%, , ? V ; . ’ • We herebyconfirmthatyou will be releasedfromyourguarantees to us of 28 May 1993 subject to receipt ofthe abovefimds. We understandthatthe transferof funds is to takeplace on7 January 1994. The instruction ofSumacInvestments Limitedin relationto the amount and allocation of the transfer to the individual deposit accounts must be in accordance withdie above proportions. . Yours faithfully, v • b-vt.iLx.v, 'm Donlon, cutive Director. W ISH im iK C O N f l M t N r A L ttA N K U M IT tO ' • •»* M t M I Q N f t Q U A U . O U a U N i • i d U Finola O'Donoghue, Manager. rtU C H O N C .O I 01 4W H40J4 i ___ • m ix >3121 A S U tth tU tA H V O f K H l O U T B A N N N V *XJCO*! CREDIT APPLICATION Background: ' The Murray Group ("M u rra ys") was s ta rte d in the 1930's by H .F . M urray, now r e t ir e d . The p r in c ip le business was i n i t i a l l y the h ire ca r business (w ith some chauffeur d rive n c a rs )« although they .subsequently expanded in to ca r - s a l e s , ^ The cu rre n t group s tru c tu re i s [o u tlin e d in Appendix 1 (in c lu d in g .. * re ia '& lie - tra d in g ) although there are o n ly - two p r in c ip a l't r a d in g companies/ . viz* * • ’ • ’ ' • - Murrays Europcar Lim ited - Car h ir e - Esmonds Motors Lim ited - Car sales . . Murrays h e ld the H ertz fran ch ise i n Ire la n d f o r approxim ately 20 years u n t i l 1972- when H e rtz decided to s e t up t h e ir own o rg a n isa tio n in Ire la n d . At ”l*l9lllTO'tfey~6r^e^'Eo''purcTi‘ aS6'Mift?Sy¥bat,'tHs^fcana5(^nr»ishedito-'---continue in business at th a t tim e. In 1973 Murrays entered e lic e n s in g agreement w ith Europcar/Godfrey Davis which i s s t i l l in e f fe c t . They c u rr e n tly have a f iv e ye a r agreement w ith Europcar u n t i l 1st Janaury 1994. The r e f e r r a l o f business by Europcar i s extrem ely Important fo r Murrays accounting fo r approxim ately .40% o f t o t a l business. In a d d itio n , Murrays have a th re e ye a r co n tra c t w ith Aer Lihgus to supply ca rs fo r t h e ir European f ly / d r iv e programme. T h is a ls o leads to su b sta n tia l, . volumes p a r t ic u la r ly ini " o f f peak" Reasons when Aer L l n ^ s are a c tiv e ly ' promoting 'vacant' s e a t s - V ■** F le e t Movements: • ' Murrays t r a d i t i o n a l ly s t a r t the year w ith 300/350 cars a l l le s s than a year o ld . B eginning in February/March t h is i s b u i l t up to 800/850 cars the end o f Ju n e . are lea se d. by Approximately 300 new cars are purchased w hile the balance Sales o f the o ld e r ca rs commence in August/September and are disposed o f by November/December. The year then commences again w ith a stock o f ca rs o f approximately 300/350 a l l - o f which would be less than a year o ld . • . -2 P r o p o s a l; . Murrays have a core borrowing requirem ent o f approximately IR£1.2m which " they have t r a d it io n a lly borrowed in currency. I t i9 proposed to tra n sfe r th is from Guinness-& Mahon who cu rre n tly provide i t . I t i s also proposed- to provide a short term re vo lvin g c re d it o f up to IR£3m to be drawndown as in d ica te d .in Appendix 2 . Th is w i l l be used fo r new - fleet, purchases and would be repaid in accordance w ith the schedule. A s. Indicated above t h is i s a- short terra s e lf -liq u id a tin g requirement. I t has \ - t ra d itio n a lly been provided by Bank o f .Ireland Finance. E x is tin g Banking F a c ilit ie s * • The following f a c i l i t i e s •are .available to Murrays: _ 1. * t Bank o f Ire la n d - O verdraft F a c ilit y - IR£250k — p*--»_ ir[l)l,-..—g*-*- - iii i- - • ? . Revolving Credit - IR£400k 2. In d u s tria l C re d it Company - Tourism Loan t IR£3Q0k 3. Bank o f Ire la n d Finance - Car Loans - Up to IR£2.'5m. The Bank of Ire la n d •f a c i l i t i e s are secured by an equiteble deposit o f the t i t l e deeds to Haddington Road (value IEP 400k) premises and the guarantee of various group companies. Tha Bank o f Ire la n d Finance f a c ilit ie s are secured by a ch atte l mortgage .. -over. ths.jm ca. fJLnanced together with e holding company guarantee, ...... ........... ..a* W. . The ICC f a c i l i t i e s are secured by a flo a tin g charge' over Thomdane Investments . Lim ited, a c h a tte l mortgage over the cars financed and a guarantee o f Murray Group Holdings. The cers financed are owned by Thorndene investments. I t is with a view to s im p lifyin g the above s tru ctu re that IIB has an opportunity to provide the re v o lv in g c re d it f a c i l it y . " Proposed S e c u rity t .The term loan would be secured for p rin c ip a l only by a bank guarantee acceptable to 118. Th is w i l l be provided on behalf of a tru s t controlled by the shareholders o f the company, who have a deposit of a s im ila r amount. * . [& ~ L -3 - S e c u rity fo r the s h o rt term re v o lv in g c r e d it would be the guarantee o f a l l group companies supported by fixed and flo a tin g charges on a l l assets o f the group. While^fche past the company has pro vid e d c h a tte l mortgages on th e .c a rs fin a n c e d ,'g iv e n the short term requirem ents, the s ize o f the fle e t and the frequent sales and purchases t h is has proved a d m in is tra tiv e ly cumbersome and ve ry expensive. M urrays, th e re fo re , are c u rr e n tly seeking a bank who w i l l p ro vid e the f a c i l i t y without the c h a tte l mortgage requirement.. • T ra d in g : •■ ' w ' .. 7- .... . . Appendix 3 co n ta in s the consolidated p r o f i t and lo s s account fo r the group fo r the la s t two ye a rs . P re -ta x p r o f it in the ye a r to December 1987 amounted to IR£414k (1986: IR£172k) more than double th a t o f the previous ‘ye a r. ■ 1986 re tu rn s were depressed by the small number o f Americans in Europe due to the Libyan c r i s i s and the fact that Hurrays d id not have the co n tract w ith Aer Lingus th a t y e a r. In te re s t cover in 1987 was 2 .4 (1986: 1 .6 6 ) a s a tis fa c to ry le v e l fo r what i s e s s e n tia lly a s h o rt term leasing company. Management accounts f o r the year to 30th November 1988 in d ic a te , a p re -ta x p r o f i t o f IR£408k (B u d ge t: IR£320k) and the p ro je c te d o u t-tu rn fo r the year is s im ila r to 1987. has in creased volumes s ig n if ic a n t ly . An improved c a r market has seen Esmonds Motors perform ing w e ll fo r the f i r s t time in many ye a rs . F in a n c ia l P o stitlo n i . 1988 has seen margins eroded b ut the Aer Lingus c o n tra c t _ .............. ....... . _ • ; . . . . . . .‘ . T h r f in a n c ia l p o s i t i o n - a t - 3 1 s t December . 19B 7 .(A p p a t id lx „ A )jh m ^ net w orth o f IR£2.1m (19B6: - IR£1.7n) re presen tin g -39* o f t o t a l assets. The lo ng term l i a b i l i t i e s represent 71# o f net w orth b ut when deferred ta x a tio n is excluded lo n g term debt amounts td o n ly 50% o f shareholders' funds. O v e ra ll, the le v e l, o f gearing is very .low at year end i n t h is company re f le c t in g the c y c l i c a l nature o f i t s f le e t . . ' A t m id -y e a r, both the in ve n to ry o f cars snd s h o rt term debt can be expected to in crea se by up to IR £3m . of 2 tim es. Nevertheless, t h is represents stock cover T h e stock would be re a d ily saleable over a number o f months and would b e more than capable o f repaying sh o rt term debt. O th e r cu rren t assets (IE PB O O k) and fixe d assets o f IEP 1 .2 m pro vid e s ig n if ic a n t e d d itio n a l s e c u rity c o ve r. . 1^3 . .................... ~ «• -4Assessment: This is a company with a long tradition in the motor industry in Ireland which has weathered the recession of the 80's very well. It has been well introduced to the bank via Stokes Kennedy Crowley, who are their auditors. Alex Spain has recently joined the Board of Murray Holdings, having been associated with the company for many, years. • . . • : . The proposal for the . IR£1 . 2 m bank guatahteed fa c ility .represent^ an attractive . return of 3/4S on whaV i s very limited risRT1 The:risk o n ln t e r e s tis 1in i ted . ^ as the structure, can be collapsed at any" time .(KB London w ill earn on the guarantee which- is cash collateralised) . . . The proposal to finance short term car asset’s i s well secured by stocks and fixed assets and is inherently of a self-liquidating nature. I IB w ill . have the right to inspect the very comprehensive fle e t summaries which Murrays * produce on a monthly basis. It will be possible to verify the location „to i n a p e c t ^ l t s , t a x J w a u a j U J n & d ----1.^...... ... centrally in head o ffic e . ' . ^ . The principal risks associated with the short term funding proposal are ■ changes in excise duties and fraud* Given the likelihood that any excise .• duty changes w ill be signalled in the Budget- (in January - when stocks ere • at a minimum) and the short term nature of the funding i t is likely that the company w ill be. able to takB stepa to BBeliorate the effects of the * . changes. ! In addition, the inportance of the car hire industry to tourism . ^ ~iiey>conceivably lead 'to-special treatment -as^n • makes the p o ssib ility of large scdle fraud unlikely. Any disposal of the f l e e t in excess of planned level would have the effect of reducing prices significantly in the merket piece. Overall, Murrays appears to be 8 tight well managed operation.' They produce excellent fle e t and financial management in a timely fashion within two weeks of month end. Having weathered the recession of the early 80*s they . are well poised to take advantage of the present, upturn in the economy end the increased emphasis being put on tourism. The strong asset cover and the readily reelisable nature of stock provide a strong basis for providing the fa c ilitie s outlined. jm ' . • 5 ° r r o w e r .8 H u rrays E u ro p ca r ^PRr ty?« 2803 P a t e : 3 .2 .8 9 C26) Purpose and Justification Purposet 1. .To approve a new IR£i.2m equiv. term loan fa cility ; 2. To approve a new IR£3.0m equiv. revolving credit fa c ility . Justification: I ••v I . . •• v.. '.■■■■ - 1. The term fa c ility represents a good return on a bank guaranteed fec illty i .2, The revolving credit le ju stifie d ,b y :. , . . ’ . .. ' (a) the strong asset cover (2.5:1) (b} the annually s e l f liquidating nature of the transaction. ( . (2 7 ) ^ Guarantees and ' a). E x is tin g . b) In process : ! . e) Proposed (New or additional^ v£i« *• Sank Guarantee ecceptable to IIB ' ■• (probably KB London) . d) — • • Special fcwditions/fcivenanta Ji%* 2 . .. . . •"'^'-•^^^is^rge^drt1:ali'ia*4ets* o f :the" borrower ■'■* ■ shared pari passu with ICC in an amount o f IR£300k.(to be negotiated) !t (28) Terns and conditlt^s Guarantee of ^ group companies floating . wjjjporl»cf£y first fixed and fla > I 1. 2. LIBOR + 3/AS OIBOR + RAC + 1. iV* T 1UA*JktS> tA M jxjtJb'& u. 2SS C o '.k 9, Cl* f t i I# f+ v U itu Vrtx , u s *** ** .w K b h t. u~~ C Aj& ll/ MlwJbtwt^ S’ oVvAjJbt’C^/ S. k ■ ■ FCeei- fZeptiiJ- fe l*g ft> SwI-cLu/ U. (ArppiMjeltJr n«<5 . r*. 428: I .! 429s Raeommandad. Murreys Europcar; Amount: £170,000 ftirpose: Working capital Rate: 15% Drawdown: ^ 4/5/77 Security: . "Suitably lacinrad". Ravlew: Raeommandad. 430: 4/11/77 * signed and returned t o u s r together. With the attached form for the opening of an account Yours faithfully, for and on behalf of IRISH INTERCONTINENTAL BANK LIMITED E A MARAH Deputy Chief Executive Accepted on the a b o v e Terms and Conditions For. and on Behalf of MURRAYS EUR Europcar m >. '’f t * * Murrays E u ro p c a r L im ited fag g o t Street Bridge, DubBn 4, Ireland. Telephone 688 1777 Telex 83784 Fax 660 2958 Dear Hugo, I enclose copies of the Audited Accounts to December 31st 1992 as follows:. ’ ’ Consolidated Accounts - Murray Group Holdings Limited . -Hurrays Europpax. Limited ...... .... . Esxnonde Motor b Limited ‘ M 'H - ’ I Wonder wbxili ‘ it ’Toe ’possible to omit .Item 3 j.i n -the to. stokes Kennedy Crowley confirming the amount of the loans et tije end of the year. . ^ c tfi 'sl#* Yours sincerely* ‘1°l v £,*. <*?"** R. Carroll. (f y . ' Murrays Europcar Ud. Dlr.elor.: H. P. Murray (Chairman). H. Carroll F.C.A.. H. T. Murray. M.S. Qil.anan. J. Smith. Rtgislirid In Ireltnd. RtQltMfttlon No. 49086. 0 o'V S .Amndix . ‘ th is to rm n a s o e e n a p p ro v e u u y . u i e m u u u t c u i u w i w i s u ...... ................................................. Irish Banks' S tan din g m m ittee and th a N orthern Ireland Bankers* * 'to cia tio n . T he Manager, . ______ f e & re fs AJ ° C - j c M f c f c -------(Bank) ......'?»••••• (Branch) Dear Sir, & ^ £ ! & i £ & # S & £ . _____------------------------------r - (N am * o f custom er) I/We have read th is d o c u m e n t and I/w e au th orise y o u t o provide th a in form ation requested herein in resp ect o f t h e accou n ts o f th e above-nam ed cu stom er a n d also t o d isclo se .the num ber o f jo in t a cc o u n ts, if a n y , t o w h ich th e ab ove-nam ed cu sto m er Is party. Please send th is in fon n a tio ri t o dtir k 1 . 5 folcea Pla.ca. j .Yours faithfully, i d t St. t n ... r t s 0 l ° * r ' u^ H > uJal£m jg . mhmmmnmmmin A uthorised Signature(s) Dear Sir, '■ i We rep ort th a t a t t h e d o s e o f business o n * _______ branch sh o w e d :— 1..•*r> BANK .w :fcuACCOUNTS ..... Dataoflast la tta DescriptionoftJ d S/SX routlin s/ lnfl Batanca (includingdeposita/cs) NonA‘eonterm bodrrltia owra ingof £ • &>cjdgI / osms. 7ook oa * & ° U 0 (s $ i . . t h e records o f this -•v'—«.< postatfatabovedata(NotaB)■ OrJOr. Est.Currant Estfmatad A ccountPm . in tsra st DrJCr. &atherchargm £ \SSV8t O ■ N o te A N ote B 2. •-4 ;».••• sSj.-. W here a s p e c ific latter o f se t-o ff fo r principal e x is ts a ffe ctin g an y o f t h e ab ove a c c o u n ts, p lea se in dicate th is b y ad din g S t o t h e a c c o u n t t itle . If th e se t-o ff refers t o a c c o u n ts o th e r than th o se b ein g rep orted o n u se S X . (O th er se t-o ffs m ay arise e ith e r e t la w o r o n f o o t o f a b ank se cu rity d o cu m e n t). T h e p ro v isio n o f th is in form ation m ay en tail w ork a n d o o sts. If th a in form ation is n o t essen tia l t h is request sh o u ld b e d e le te d . _____________ __ F U L L T IT L E S A N D D A T E S O F C LO SU RE O F A L L A C C O U N T S CLO SED D U R IN G PER IO D : *N .B . D a te t o b e in serted b a to n form is se n t to bank. C.2S ( 1 1 / 8 2 ) * /"V. ' ........................... N atu re o f se cu rit\ ltd d ir e c tly fro m c u s to m e r le .g . D e e d s. S to c S h ares e t c .) . A m o u n t o n ly o f a n y g u a r a n te e s h e ld fo r th e b e n e fit o f t h e c u sto m e r . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......... ...............-....................... — • 4. CONTINGENT LIABILITIES: All known contingent liabilities .. Oate(s) Amount £ (a) Total of Bills discounted for your customer, with recourse ■•• .J-*. •. / . t (b) Amounts and dates of each Guarantee, (exducfing Accept* ; ances) Bond or Indemnity given to you by the customer. ^ 1 ;... ' -- - (c) Amounts and date* of each Guarantee, (excluding Accept* ances) Bond or Indemnity given by yoy on behalf of your customer. . (d) Total of Bills drawn on and accepted by Bank on behalf of customers (excluding (f) hereunder). (e) Total Forward Foreign Exchange Contracts. 1* ' ' ^ ( f h T o t t l - o f - Outstanding- •U M tia s ~ M (K l« * J l9 ^ Credits. (g) Others —Please give details: • . ,\ ' iipetyt % • ’ Tha information available a t branch contained herein ’1* given in cotttidenca for Your use* only. In your capacity as Auditor(s) and without responsibility on the part of the Bank or . any of it* officials. " ............ ........... .,‘wu‘ •’'■ ...... Note: No Information can or will ba given which would disclose confidential Information regarding other customers. Signed.......................................... ........... ........................ ..MinaQW Date Branch Brand ’ Earlsfort Terrace, STRICTLY PRIVATE & CONFIDENTIAL ADDRESSEE ONLY The Inspectors Third Floor Trident House Blackrock C O DUBLIN Dublin 2, Ireland. Telephone Fax 01-664 4200. 01-664 4300. Intl. Code + 353-1 EMail R@odonneilsweeney.ie OX 109 023 Dublin Our Ref: December 3, 2001 C/M18/NSPM NF/FF our client: Harold T. Murray, The Leys, Glenamuck Road, Carrickmines, Co. Dublin. re: The late Mr. Harold F. Murray, deceased Dear Sirs and M a d a m W e refer to your letter of the 25th October, addressed to our above named client. Our client has instructed us to write to you in response to the preliminary conclusion that the late Mr. Murray (our client’s father) was a client of Ansbacher. C o m p a n y loans As our client has averred to on Affidavit, funds were paid out of the Companies for the benefit of the Trust and thereafter ceased to be Company monies. The Companies had no further beneficial interest, direct or indirect, in the monies except in one respect. The principal shareholder of both Companies at that time was our client’s father, the late H.F. Murray. He was also a beneficiary of the Trust and was influentiai in getting the Trusiees to see their way to placing certain Trust funds in bank accounts, firstly, with Guinness & Mahon (Jersey) and later with Kredietbank, as a result of which the Companies got slightly more favourable terms on borrowings from the said banks. Trust funds You have already been furnished with a copy of the Trust document entered into by the late Mr. Murray (" th e W o o d w a r d T r u s t’] . Under the Trust Deed and at law, the Trustees of the Woodward Trust had full control over the funds held by them. The Woodward Trust was set up by our client’s father. Our client had no involvement whatsoever in the establishment of the Trust. Nor did he have any communication whatsoever with the Trustees at any time. NF/FF Page 2 of 2 Our client has quite openly acknowledged that it was his impression that his father had considerable control over how the funds were administered. However, our client has no knowledge whatsoever of the day to day operations of the Trust or of any communications between his father and the Trustees. W e note that in reaching your conclusion that you seek to rely upon our client’s evidence and the documents attached to your memorandum. W e see nothing in our client’s evidence or in the documents to suggest that the late Mr. Murray had any right to override the specific provisions of the Trust Deed. Indeed, we note that you accept that if, as you appear to maintain, funds were moved to Ansbacher Cayman, this was done without the late Mr Murray’s knowledge. This is consistent with the trustees having control over the funds and not the late Mr Murray. In our submission, you have absolutely no evidence that Mr. Murray had any role in relation to the Trust, other than to request the Trustees to consider applying funds in a particular manner (a request which the Trustees could at their discretion either refuse or go along with). With respect, you appear to be concluding that the Trust Deed was effectively a " s h a m ”. Such a conclusion requires you, with respect, to make assumptions and suppositions not based on any evidence before you. W e respectfully submit, therefore, that for you to reach the conclusion which you propose requires you to unreasonably stretch the facts before you. Given the above and bearing in mind the very serious and damaging effect that publication of the late Mr. Murray’s name as “a c lie n t o f A n s b a c h e r ” would have on the reputation and standing of the late Mr. Murray and his family, itis our opinion that you are not entitled to form the conclusion which you propose. Please note that if you proceed to form this conclusion and include same in your report to the Minister, our client reserves the right to issue judicial review proceedings against you and any other proceedings as Counsel may advise. Yours faithfully O ’D O N N E L L S W E E N E Y Appendix XV (154) Mr Brian Rhatigan 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Brian Rhatigan. a) Guinness and Mahon statement o f 20 November 1992 - GMCT re College. b) Internal Guinness and Mahon memo of 25 May 1977. c) Extract from credit committee minute o f 26 October 1977. d) List o f companies, furnished by Mr Brian Rhatigan, with which he was associated. e) Extract from Guinness and Mahon executive directors meeting o f 29 June 1977. f) Extract from credit committee minute of 31 May 1977. g) Extract from Guinness and Mahon banking report dated July 1985. h) Extract from Guinness and Mahon banking report dated May 1988. i) Extract from Guinness and Mahon credit committee minute o f 25 October 1978. j) Extract from Central Bank Report on Guinness and Mahon dated 1978. 3+M G U I N N E S S + M A H O N LTI t7CBfcg«0«—w0n*»«»a<,0 0o»S6ATub-vlM iamI t lit* nav<«Z (mums) ,3 is }sfn. Brian RhaHflan, E*qulr*i - EXTENSION* Am ount: £ 1 3 ,0 0 0 Tame Extwufonof 3montfii to 30/9/97 Ratat 1 5 $ % flx a d . Drawdown:By way of fluctuattng owrdrofK (ft— nt Bdano £72,530.) Security: "Suitably Sacrured"., ’ Rovlaw: 30/9/77 " R * c c sn m * n d * d . . Brian RhaHsatf, Esqulr* - EXTENSION: ■^ AppendixxvaMme), ' OlESSNTs - * Minutes of the 148th Meeting of the Banking /Credit Committee held at 17 College G n m , Dublin 2, en Wednesday 24th October, 1977. J. D. T. - M. E. O'K. - M. J. P. - GMeC - P. O'D. - BMeL. - M. C. K. I. W. K. MONEY MARKETi 60& QBM Anthony & Men Rhattgan: Amount: £5,000 Purpose: Guarantee required b y U lster Bank Ltd. Ranelogh. a ll'll] £50 Conmlfanent F « « Saeurily: 5 d b ily S * c u r« d . ' R*eomm«nd*d. ■ Im • I- nlsai _ jJ - •» * /(/, T *. ?Rhntigan Holdings Limited Holdings Limited rBrook?eid Seem-ides Limited VMeduaa Seemitiee Limited :?Oa?ey Seemitiea Limited - Spaeemate Ireland Limited /Ardi?' Searities Limited rBdOdi Holdings Limited z?l?ownhold Limited nun-? no? 1_ Appendixxvasom 7 WECUT1V8DttBCTOUM0STWO. NO. 25. MadamSwfttat UnrfMi T Tfch loan tm ainadyfaaM rahnad-ta In Mlnuta 1470. W* wfH now prevld* S £ 0 ,0 0 0 and na» 8 8 3 ,0 0 0 at DoM , unit) HMfakiaMf ay GirfnwN Mahan &Ca. of lha Mai anaunt. V Approval!. J nudism?) (mo 23' r\ r 1470» Madura Saeurttto Ltaltadk • - Thli loon'lo Hb abovo nanHanad, which b eoMrollad by Hw Rhatfgan Brat. ThvoIvm a total ef£1<0,000 and will ba pravtdad by O . M. &Co. In tha moanHme, wa hem bam mkad lo ptovlda £83,000 unHI tha and of A m , 1977. DMferanHal 2% -Suitably Saeurad. Appendix ms?wm) a nun .u . W. [and I mum for sigma in [?our of Irish . - Lilo Axum-m on hum]! of Bulging? ?mind ml rescind cash ?I'u manage. M B B f l y i w fc i M n f l ? a ~ m t o w a n iat nonuani; / a r a n ( f f t a r X ba I ‘ t M l o * J O S f w S S w S ^ " 8 :* *• h*T« lantd «■» 1 5 0 , 0 0 0 m r l t l M J b U l f l l k - B l a r i a n ** tv n a e a t A.X.X.B. f t S o Z n d c a m a r lt j r B f o b a r t l n n f l 0 O I ) 1 O / ^ J (154mm) Minutes of the 249th Meeting of the Banking/Credit Committee held at 1 7 College Green, Dublin 2, on W ed n e s d a y 25th October, 1978. PRESENT: M . E. O ' K . - M . J. P. - G M c C . - P. J. F, - P. O ' D . - I . W . K . - M . C . K. O a k l e y Securities Lid: Amount: £70,000 Purpose: Working capital T e r m 1 year : Rate: 2% over base Security: Joint and Several Guarantee A . & B. R h aH ga n and hypothecated deposits in n a m e of Par & Brl-odl Holdings to extent of £40K. Recommended. Appendixxv-(immI? I I I I Cwpany which owni tha South County Hotol. Dim of tha directors of tha eoopany has deposits of S3 million with tha hank through inofchor conpaqy on which th« bink has • lcttor of undertaking. The bank *111 obtain a charge on tha Hotel. Appendix XV (155) Mrs Margaret Clifford 1. Ev i d e n c e relied u p o n b y the Inspectors in arriving at the conclusion relating to M r s Margaret Clifford. a) Extract of transcript o f evidence of M r Jack S ta kelum dated 8 N o v e m b e r 2000 . b) Letter o f 18 October 2 0 0 0 f r o m Inspectors to M r Jack Stakelum. c) Letter o f 6 N o v e m b e r 2 0 0 0 a n d enclosure f r o m M r S ta ke lu m to Inspectors. d) Letter of 21 February 2 0 0 1 a n d enclosures fronr M r St ak e l u m to Inspectors. e) Gu i nn e s s a n d M a h o n credit m e m o of 3 M a y 1985. f) Letter of 3 M a y 1985 - Guinness a n d M a h o n to Princes Investments Limited. g) Gu i nn es s a n d M a h o n credit m e m o of 7 M a y 1985. h) Letter of 10 April 1975 - Gu inness a n d M a h o n to Princes Investments Limited. i) 2. Letter of 21 D e c e m b e r 2 00 1 - D o w n i n g Courtney & Larkin to Inspectors. C o r r e sp on de n ce received f r o m or o n behalf o f M r s Margaret Clifford. a) Letter o f 7 February 2 0 0 2 - D o w n i n g Courtney & Larkin to Inspectors. 23 147 24 Q. When did that start? A. I am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service r s 1 A. If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 10 149 Q. Could you not be a little bit more specific because you know these terms, I don't know. . 11 Would you mind explaining them to us? 12 A. If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 16 17 151 18 Q. This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in 19 20 the sense of- what interest rate...(INTERJECTION). 152 21 22 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 ’ They were asking me whether I could monitor those funds on their behalf. 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say ’We have funds offshore' wherever 1 they might have been. 'Can you look after these funds 2 for me.' 3 155 Q. 4 mean? 5 A. 6 7 "Can you look after these funds." What did that Would you endeavour to get the best interest rate. Would you monitor the funds. ’ 156 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial Q. 10 institution? 11 A. I don't think they would come in and say *We have 12 funds. 13 financial institution.' I think a discussion would 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other Q. What does that mean? A. It.means that they might not want to correspond 19 directly with whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 And that Q. What did you do then? A. I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 What does that mean in this connection? 5 A. It means I would probably have contacted 6 Des Traynor. 7 — 8 were — that wishes to have funds monitored abroad 9 by me.' 10 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? A. 13 . You have a client. Des Traynor is to give me an account number, a 14 reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — might be 18 moved to a receiving bank. 19 162 Q. This is very important. Those funds — If you don't understand it, 20 1 understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 1 164 Q. 2 What was the account, in whose name was the account to be placed? 3 A. I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. 8 All I am saying is You must have known the financial institution in which your clients's funds were going to be placed? 9 A. The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. 13 Tell me some of them that were used that Mr. Traynor would have told you about. .14 Give me the names of some of those, Mr. Stakelum? 15 A. It is very difficult unde? oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 -so-etc. etc.. 20 that. 21 If it was dollars it might be something else. 22 167 Q. 23 I don't know. But I am not absolutely positive of.. It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? 24 A. I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 29 168 Q. I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other 34 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. 5 6 169 170 Q. Why can't you remember?' A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 9 the Guinness & Mahon subsidiaries in Cayman or in , 10 the Channel Islands? ; 11 ! 12 initially lodged somewhere maybe for the account of . 13 Guinness Mahon Cayman, reference number so and so, A. I don't think so. . 14 But I think the funds would be maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. 18 ^ That is not wanting to be uncooperative, I just cannot remember. 7 8 I just cannot answer that. 19 I am not too sure. It may have been the account of Guinness & Mahon in Dublin or Guinness & Mahon in London. • Was this the offshore bank we are talking...about, Guinness & Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 24 172 25 26 173 They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? 35 1 A. I cannot remember. I suspect that some of the 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 what their internal ...(INTERJECTION). 5 174 Q. A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A. 175 13 14 They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 11 12 Didn't you say that to me a few 176 Q. They were offshore already you think? A. Yes, most of the funds were offshore already. Q. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 18 177 Did you ever have clients coming in A. Yes. Q. What would happen then? A. •At different 3tages,- in the early stages I think 19 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 24 25 26 179 It is one and the same in the Then-they could be moved from Sterling. Q. Were they put offshore, the funds? A. Yes. Q. Where? A. All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey, But it could well have been 1 180 2 3 181 Q. One or the other? A. Yes, I assume one or the other. Q. Did any of your clients to your knowledge establish 4 trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in the Cayman Islands or in the 6 Channel Islands? 7 8 182 9 10 183 A. Not to my knowledge. Q. None of them told you that they had done this? A. No. Q. Mr. Traynor didn't tell you that he was going to 11 suggest this to them? 12 13 ' 184 A. No. Q. You are pretty certain on that or are you doubtful 14 about it? 15 A. I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q. 19 22 If they didn't establish trusts, you are aware of 186 A. Yes, that's right. Q. We will break now for a cup of coffee, Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 ' clients who transferred funds offshore? 20 21 I am not aware of any SHORT ADJOOTaaflBW? 18* October 2000 Mr. Jack Stakelum “Fairmont?’ BaUyrooan Road Kflpedder Co. Widdow Strictly Private & Confidential -Addressee Only . , . Dear Sir I refer to your letter of 11 October 2000, and I reply an my own behalf, and on behalf of my colleagues, Mr. Justice Declan Costello andMr. Paul Rowan. 4 Wc now wish to examine you under oath concerning the matters set out in our two letters dated 30 August 2000 and 21 September 2000. To that’end, I propose that an interview would take place in our offices at the above address, either on Wednesday 8 or on Thursday 9 November, at 10.00 a.m. Perhaps you would make contact with our secretary, Ms Frances Gaynor at the above phone number to confirm either date, or to make mutually conveoieit alternative arrangements if those dates do not suit you. We note your refusal to provide us with names of your clients prior to examination. I must point out to you that you are obliged by law to provide us with the information we have required of you. In that regard, I refer you to Appendix B of our two letters, which sets out our statutory powers. You m il note that section 10(5) of the Companies Act 1990 imposes a duty upon you to comply with our requirement, and, in the case of a refusal to do so, nukes provision for the matter to be dealt with by the High Court I therefore repeat our requirement that you provide us with the names and addresses of those clients who you may have advised in relation to trusts in the Cayman or Channel Islands, or in relation to the transfer of funds to either of those islands. We require this information to be provided in writing prior to the interview. We have noted also your expressed intention to argue at interview that it would be invidious to disclose the identity of your clients. Once again, I must point out to you that you are obliged to do so, in compliance with our requirement The interview is not the proper forum in which to make submissions, and it is not our practice to entertain diem. Yours faithfblly . (1)03) I r ' n r m11 ■■f■■ fniini - i■ fJSii : : H E " J A C K S T A K E L U M CHARTBKBD ACCOUNTANT . TELEPHONE: 2810646 PAX: 2810645 MOBILE: 087 2854660 . The Inspectors y * Floor Trident House Blackrock “FAIRMONT" BALLYRONAN ROAD KILPEDDER CO. WICKLOW m . ao* n 6 November, 2000 Dear Sirs, . With reference to your letter ofthe 18* October, and in particular the third paragraph, I should point out that I did sot refUse as such to provide the information in question, merely that I should be afforded the opportunity to arguewhy I should not be asked to divulge such information. The persona in question dealt with me on an understanding of confidentiality, and as the Inspectors will surely appreciate, it is difficult not to honour that confidentiality, particularly when one has been uarf, over one’s professional life, to honouring the confidentiality of Clients. " However, asyou point out forcefully in your letter, you arenot prepared to allow me that opportunity and you have referred to the legal position. In the circumstances, I attach a list ofthe names and addresses ofthe persons in questioa r * Yours feithfiUly, End: fci . 'fl' WaHtn Clifford, c/o Vigo Lodge, The Spa, Tralee, Co. Kerry (deceased) f*N *i.» :a;r« w: I JOHN J. STAKELUM ?Fairmont? Ballyrouan Road, Kilpedder, Co. Wicldow. 21 February 2001. 1th Court Inspectors, it? 5 3 Floor, . Trident House, thhouk, Co. Dublin. Re: Interviews with the Inspectors on 811112000 and 6/12/2000. Dear Inspectors, Th1? contentinsections I-and2has add clari?ca?ontp the informatton given in my Statemnnt dated 22 September 2000. 1. The Consnltancy B o d ie s I set op in 1975. . In December 1975 I decided to set up a business that would provide a general financial Consultancy service to clients. I had identified the market need in Haughey Boland & Company during my auditing work but more particularly during my receivership, liquidation and financial restructuring experience. The services I decided to focus on were: • • • • • • • • • Preparation of properly assembled requests for financing from banks. Preparation of well constructed projected cash flow and profit and loss statements. Accompanying clients at meetings with their bankers. The presentation o f meaningful management accounts and the procedures within businesses for the timely production of them. Being a sounding board for all kinds of operating issues - both problems and perceived oppoitumtes. Guidance on where to go and howto request professional services. Helping businesses in difficulty to get back to profitability or to move logically to receivership or liquidation . Acting for clients in the purchase or sale of businesses. Acting in a non-Executive Director capacity when requested to do so. Those were the principal service headings under which I operated in the name o f Business Enterprises Limited from December 1975 until my retirement on the 31 October 1998. This business was busy, demanding and successful. Typically, it occupied well over 100% of 50hour weeks. 2. Th e service I gave to persons who wished to hold fond* ofbhore. Involvement with the savings of clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalist basis. Towards this my stipulations were: • Funds would be deposited in licensed banks at rates of interest that would be competitive and market related. This empowered depositors to be satisfied concerning both safety and interest rates. • A ll decisions in relation to movements in these funds would be conveyed to me directly and orally by the person concerned; « I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling o f investments. • I would neither issue'nor obtain receipts for movements in funds. Neither would I keep any ledger recprds, issue statements or engage in correspondence. • Information in relation to balances and rates of interest would be provided on an oral basis only. • Originally, no charge was envisaged for this service but over time it became necessary to recover costs on a case by case basis. M y operating procedure for this service bad but four components: • • ■• • • • A deposit account in G & M that I have described as a hotchpotch account. A manual memorandum record I kept in my office under my personal control A float account in A IB . A monthly reconciliation o f the sum o f the memorandum records with the sum o f the accounts) in G & M and any float balances. In the interest of completeness perhaps I should add also: • G & M would be aware o f the total funds I had in my hotchpotch account • G & M would not be aware o f the names of the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could sur&ce as part of another business transaction with the bank, e.g. a back-to-back ban. • Some o f my clients would be aware generally that the funds they held offshore were In a G & M vehicle. Other clients would be aware that their funds were offshore but would have no awareness or care about the name o f the bank in which their money was deposited. ' • Only I knew the names in the memorandum account and only I knew the ownership of the balance in the float account kept in A IB . ' The information requested by Ms. Mackey on 6 December* 2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list of names I sent to the Inspectors on 6 November 2000. schedule had offshore deposits in G&M through my procedure. Yours sincerely, A ll on this SCHEDULE 1 Name. Offehae Beckie DeteDepoelt DeteDepodt Smamede Scumeomeds Depoe?e Backloan. Opened Closed - Offshore Irish Pounds. wmiun cum Yet No. Circe 1970. On dellh - an; Bnyec. 1967M. All. Nme. NAME : Cradle MMMnadoa ( aittod bjr : po'n Equity itik i * ’ PrincM lovMcmm Llaltad. ADDRESS : c/a, BwloMS Entarprlsai Ualtad, 17, Cl yd* Roadt BallafarUfl*, Oublia 4 MiMMrsa / _ ORATION : lnvatfment Comply. PmlMton Obtataad DM*» N/A . I Oaiaw m awroprtatn 1 ™ * M I L PURPOSE / DRAWDOWN : If mm or lic w d IkUMMi is 4n**hrn panaittad prior to cm pM m of *acuritjr T ' Worfclaf capital YES / MBu TERM Or PAOUTKS : . REVIEW DATES i lUtanaloa for oaa y**r, 3LUML ' SOURCE or REPAYMENT j Caah Flow. OUTUMB OF PROPOSAL t Guarantors an . m H ta m Ii Qomidifid sdMMMb . to OutaMM • IU hm and la tfci* eaao fta Mcmirv RELATED rAOUTJES / BORROWERS t Total Expotura : CUM,M& 1 'v ■ Mh — Orta SftCfotC ‘ NRnMiPBIBiV BOARDtnmiiinui hi -. riir Now ilmlt(s) Ra«ordad by .... DaM t Approvad tC»( If ovar Cl* total •fBDM) AfrntmmmA kw • .... .n*H> i ... OM, Dttt t MiMnimniiniiiH m * & 2 : Appendix Tha Secretary, do, M m h Entwprim United, IT, Clyde Road, Ballibrtdga, D U M Ij Omt Sir. We an pleeeed to confirm that «a ara prepared to axtand your facility for a further period Mbject to the following tenae and coodlUanBN nM bNWMMi Limited. 1180,000.00 (One Hundred and Eighty Thoaaand Poendi) - Starting f. Purpoaet Tba fund* hive already been placed at jm r dbptnl In die for* of working capital. Tana: hi acoordmca with nornal banking practice all fuada taken «p an repayable on demand but In any cue not later than Slat May, IMS. Wo propaaa to continue charging Interest at a find rata of IS* par annual. Interest win be debited on yoar account and baccate payable by you on the nmol quarterly dataa and at Maturity of the loan. Security: As aecurity for the toea we to ll retain the guarantee ilgnad by J. J. Byrne and Tboeiaa Clifford. W* «r« pMoootf w bo of i ii Ii ii w to you « mI «aclQM harowitli • copy of tWt facility lotMr for oiSMtm by yoor autboriwd ti Mtorl«a •ad rotnrn thoroby conflr^ln* yofr ■co ptineo of tk* lorn on the term Motioned. W o itMU raquiri • copy of • Board Ranivt ion Mttarblnf the continued bornnrtaf. - Yoon M thNfe - far.OUMNEM * M A H O N L M T E D . ’ BMktag KlMMStf* T.VL 1U S S V " Bttktof Mfltaftf* tiao.ooo. Caplt. 1 . for 0 0 1 5 o I * fllM . A,n«hr z z .. 9 7 • ................. If hw or Inm w d fadUttet, Is diawdowa INMUMd prior 10 cM Blttki a agearitr f PURPOSE / DRAWDOWN: Working capital YES f Ufloc . REVIEW DATES t TERM OF MC3UTTES > Extaaaioa for aw * r- . 3ULM8S. SOURCE OT REPAYMENT : CaA Flow. I 0 SECURITY i Guar*WM J. J. BjmM and Tlm ui CSriML If iM ttaw l of yrtfltliig tefllty, u mcurltj to t • YES/M b If No, itodataUa mpmrnif. BACKGROUND NOTE / OUTLINE Of PROPOSAL I Cuaraatart tra wall knowi to Cuhwn «■M itai Md la thu eta* (to aacurtty ii eenU m l ariaquata. RELATED rAOUTttS / BORROWERSl ..........r ..... ^ ^ . H i 6 ^ VTlnill lUfiMIMNNild fi&ABEL u iim t'T ’Sir *~Tr«rir~*~" -~7^ ' f • Total Expoturt t 1180,000. . aw Unit(a) Rteardad by s ......... »...— Cato t lurltjr in ordar lor Drawdown i ' ........................... Data t MMMHHtMWM Approved GJM. ft Ca, ( If ovar £lm total e*oiura) ‘AxmmmI tw > . ..._ n*t» ! Appendix 17. C o l l e g e G r e e n , D U B L IN . 2 . ’P.O.BOX SSA. W u J S S S S liM I iw rnwiw: w w t.puu h m a n O ar R e f : REGISTERED OFFICE. 1 0 th A p r i l , PO'D/M R. 1 *7 5 . The S e c r e t a r y , P r in c e s In v e s tm e n ts L im it e d , 6 0 / 6 2 , A n ie n s S t r e e t , D U B L IN l . Dear S ir , ■ ‘ On t h e in s t r u c t i o n s o f M r. T r a y n o r , we w r i t e t o c o n fir m t h a t we a r e p re p a re d t o make a v a i l a b l e t o you a f a c i l i t y , s u b je c t t o t h e f o l l o w i n g te rm s and c o n d itio n s : (1 ) Maximum Am ount: £ 1 1 6 ,0 0 0 (One Hundred and S ix te e n Thousand P o u n d s ). . (3 ) Term : A l l fu n d s advanced a r e re p a y a b le on demand b u t i n any c a s e n o t l a t e r th a n t h e 6 t h M a rc h , 1 9 7 6 . (3 ) Drawdown: The fu n d s h ave a lr e a d y been ta k e n u p . (4 ) In te r e s t: Ve p ro p o s e c h a rg in g I n t e r e s t on t h e f a c i l i t y a t 11$% p e r annum. In te r e s t w i l l be d e b ite d by us t o th e Account on t h e 3 0 t h JUne, 3 0 t h Septem ber and 3 1 s t Decem ber a n n u a lly and a t m a t u r it y o f th e L o a n . Ve s h a l l a p p ly t o you im m e d ia te ly a f t e r t h e a fo re m e n tio n e d d a te s f o r payment o f i n t e r e s t (5 ) S e c u r it y : As s e c u r i t y , we s h a l l r e q u i r e a F o r a o f G u a ra n te e s ig n e d by M r. J . J . B y rn e , M r. W illia m . C l i f f o r d and M r. Thomas C l i f f o r d . The r e l a t i v e Form o f G u a ra n te e i s e n c lo s e d f o r c o m p le tio n and r e t u r n a t y o u r e a r l i e s t o o n v e n ie n o e . (6 ) Reserve Bequirem ents: I f tb e r e e h a .ll be any In c re a s e I n th e co st to ue o f making o r m a in ta in in g th e Loan by an amount which ve deem m a te r ia l r e s u lt in g from any changes In th e re s e rv e o r l i q u i d i t y requirem ents t o which t h i s Bank i s o r nay be s u b je c te d , then we s b a l l be e n t i t l e d to c a l l f o r payment o f a d d it io n a l i n t e r e s t o f such amount as we s h a l l c e r t i f y as th e amount re q u ire d to compensate us f o r such in c re a s e d cost w ith e f f e c t f r o a th e d a te o f n o t i f i c a t i o n . Tou s h a l l be a t l i b e r t y w it h in one month l i f t e r such n o t i f i c a t i o n and w ith o u t payment o f any premium o r p e n a lty to repay th e f u l l amount o f th e Loan o u ts ta n d in g to g e th e r w ith ln t e r e s a t th e r a t e a p p ly in g p r i o r t o n o t i f i c a t i o n . . - Ve enclose h e re w ith a copy o f t h i s f a c i l i t y l e t t e r f o r s ig n a tu re by your a u th o ris e d s ig n a to rie s and r e tu r n I n due course, th e re b y o o n fir m in t acceptance o f th e f a c i l i t y on th e terms s ta te d . Ve a h a l l a ls o r e q u ir e a copy o f a Board R e s o lu tio n c o n firm in g th e b o rro w in g . Ve a ls o enclose a Form o f Mandate and S ig n atu re Cards f o r c o m p letio n and r e t u r n co verin g th e o p e ra tio n o f a Banking Account. Vben r e tu r n in g th e aforem entioned documents to us, perhaps, you would a ls o k in d ly arran g e to l e t us have a copy o f your Memorandum k A r t i c l e s o f A s s o c ia tio n to g e th e r w ith a photocopy o f th e C e r t i f i c a t e o f In c o r p o r a tio n . * Yours f a i t h f u l l y f o r GUXKNSSS fc MASON LIMITBD . t P . 0 * Dwyer, Loans O f f i c e r . iB B . J . MoLoughlin, .A u th o ris e d S ig n a to ry . ’ ■ . i Appendixxvass)a)(i)_ DOWNING, COURTNEY & LARKIN SOLICITORS (I N C . E U G E N E D O W N IN G * C O .. A N D D O N A L J . C O U R T N E Y ) MICHAEL C.LARKIN.(CL..LLJL.WrTAHYRWUC MAURICE COFFEY.S.CUU.B. 84, NEW STREET, KILLARNEY CO. KERRY, IRELAND TEL. 064-31061. E-mail: info@downingslaw.com Inm-kafcr:KENMARE. OumiOgkt:24UPPER ORMOND QUAY. DUBLIN 7. V.A.T. Reg. No. I.E. 0092115L. DX 5 1006 KILLARNEY FAX. 064-33934. 21 Our Ref: M CL.M B.M Your Ref: C/C23/NSPM Re: M rs. Margaret Clifford. Vieo Lodge. The Spa. Tralee. Co. Kerry. Dear Sirs, We act on behalf of the above named who has passed us your letter of the 14th December and received by her on the 19th idem. Our Client does not question the obligations placed on you or your statutory powers. Our Client has no information concerning the affairs of the Company and we set out hereunder such information as may be of assistance, though same does not directly refer to it. Our Client’s dccea3cd husband, Mr. William Clifford, had certain funds invested with Mr. Jack Stakelum. She was unaware of the existence of such funds until after his death in 1981. Mr. Stakelum continued to hold the funds until the mid 1990’s -perhaps 1993/1994. During the interim period, our client was advised by Mr. Stakelum that the fluids were held off shore, but at no time did he specify where they were held. Further our Client holds no documentation in respect of such accounts and presumes that such documentation as exists is held by Mr. Stakelum. Our client never dealt directly with the funds and same continued under the control of Mr. Stakelum until same were repatriated in or about March 1994 and the Revenue Commissioners were advised of the funds at that time. Our Client is not in a position to assist you further and she trusts that this letter will suffice as providing such information and documents ap she. holds in her custody or within her power to provide. Yours fiiihfull Downing, Office of the Inspectors Appointed By O rder of the High Court To Ansbacher (Caym an) Limited, 3rd Floor, Trident House, Blackrock, C O . D U B L IN ¥ Larkin Appendix Xvassmua) DOW NING, COURTNEY & LARKIN SOLICITORS (IN C . E U G E N E D O W N IN G & C O ., A N D D O N A L J. C O U R T N E Y ) MICHAEL C.LARKIN, B.C.L..LL.B..NOTARY PUBLIC MAURICE COFFEY, B.C.L..LL.B. 84, NEW STREET, KILLARNEY CO. KERRY, IRELAND TEL. 064-31061. E-mail: info@downingslaw.com O u r Ref: M C L . M B . M BranchOfferKENMARE. DublinOffice:24UPPER ORMOND QUAY. DUBLIN 7. V.A.T. Reg. No. I.E. 0092115L. DX 51 006 KILLARNEY FAX. 064-33934. 0 7 Fe br u a r y 2 0 0 2 Y o u r Ref: C / C 3 1 / N S P M Re: M rs. M argaret Clifford. Vigo Lodge. The Spa. Tralee. Co. K erry. D e a r Sirs, Y o u r letter o f the 1 5 th January addressed to M r s . M a r g a r e t Clifford has b e e n p assed to us w i t h instructions to reply thereto. A s set out in our letter to y o u o f the 2 1 st D e c e m b e r last, o u r Client w a s u n a w a r e o f the existence o f the funds invested w i t h M r . S t a k e l u m until after the death o f her H u s b a n d , M r . W i l l i a m Clifford. S h e c annot say if her late H u s b a n d w a s a w a r e o f w h e r e the funds w e r e invested, but it appears f r o m M r . S t a k e l u m ’ s evidence that it is m o r e likely that h e w a s not so aware. Insofar as M r s . Clifford w a s a n unwitting beneficiary o f these funds a n d h a d n o input into the operation o f the s ame, it is unjust to n a m e her as a Client o f A n s b a c h e r a n d to d o so will certainly b e adverse to her g o o d n a m e a n d reputation. Natural justice s hould surely dictate that o ur Client not b e n a m e d as a n A n s b a c h e r A c c o u n t H o l d e r in the abs e nc e o f a n y concrete evidence that she w a s such. A s our Client is a stranger to the matters referred to in M r . S t a k e l u m ’ s evidence, w e believe that to take u p the opportunity o f cross e x a m i n i n g h i m will serve n o useful p u r p os e a n d will m e r e l y delay matters. O u r Client rejects y o u r preliminary conclusion thjj ^yas a n A n s b a c h e r A c c o u n t Holder. Y o u r s fai D o w n i r i g / C o S k n e y & Larkin Office of the Inspectors Appointed By O rder of the H igh Court T o Ansbacher (Caym an) Lim ited, 3rd Floor, Trid e n t House, Blackrock, C O . D U B L IN Appendix XV (156) Mr Thomas Clifford 1. E vi d e n c e relied u p o n b y the Inspectors in arriving at the conclusion relating to M r T h o m a s Clifford. a) Extract of transcript o f evidence of M r Jack St ak e l u m dated 8 N o v e m b e r 2000 . 2. b) Letter o f 18 October 2 0 0 0 f r o m Inspectors to M r Jack Stakelum. c) Letter o f 6 N o v e m b e r 2 0 0 0 a n d enclosure f r o m M r St ak el um to Inspectors. d) Letter o f 21 February 2 0 0 1 a n d enclosures f r o m M r S ta k e l u m to Inspectors. e) Internal Gu inness a n d M a h o n Credit C o m m i t t e e M i n u t e of 31 M a y 1985. f) Letter o f 3 M a y 1985 f r o m Guinness a n d M a h o n to Princes Investments Ltd. C o r r e sp on de n ce received f r o m or o n behalf o f M r T h o m a s Clifford. a) Letter o f 3 0 January 2 0 0 2 f r o m D o w n i n g , Courtney & Larkin to Inspectors. 23 147 24 Q. When did that start? A. I am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service 1 A. If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 Q. Could you not be a little bit more specific because 10 . you know these terms, I don't know. 11 explaining them to us? 12 A. Would you mind If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 15 or wherever. Q. This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? 18 A. They might be unhappy about monitoring the funds in 19 • 150 16 17 20 151 152 21 22 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 the sense -of- what interest rate... (INTERJECTION) . They were asking me whether I could monitor those funds on their behalf. 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say 'We have funds offshore' wherever 1 they might have been 'Can you look after these funds 2 for me.1 3 155 Q. 4 What did that mean? A. 5 Would you endeavour to get the best interest rate. Would you monitor the funds. ' 6 7 "Can you look after these funds." 156 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial Q. 10 institution? 11 A. I don't think they would come in and say 'We have 12 funds. 13 financial institution.' I think a discussion would 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other Q. What does that mean? • A. It. means that they might not want to correspond 19 directly, with, whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 And that Q. What did you do then? A. I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 in this connection? 5 A. What does that mean ” It means I would probably have contacted 6 Des Traynor. 7 — 8 were — that wishes to have funds monitored abroad 9 by me.' 10 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A. You have a client. Des Traynor is to give me an account number, a 14 reference/ a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — might be 18 moved to a receiving bank. 19 162 Q. •This is very important. Those funds — If you do.n't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don’t remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. \ 1 164 Q. 2 What was the account, in whose name was the account to be placed? 3 A. I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. All I am saying is You must have known the financial institution in which your clients's funds were going to be placed? 8 9 A. The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. Tell me some of them that were used that 13 Mr. Traynor would have told you about. 14 names of some of those, Mr. Stakelum? A. 15 Give me the It is very difficult unde? oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 so-etc. etc.. 20 that. 21 If it was dollars it might be something else. 22 167 Q. 23 I don't know. But I am not absolutely positive of . It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? 24 A. I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 29 168 Q. I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other 34 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. 5 6 That is not wanting to be uncooperative, I just cannot remember. 169 7 8 I just cannot answer that. 170 Q. Why can't you remember? A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 9 ‘ the Guinness & Mahon subsidiaries in Cayman or in 10 the Channel Islands? 11 A. I don't think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. I am not too sure. It may have been the 'account of Guinness & Mahon in 18 Dublin or Guinness & Mahon in London. 19 offshore bank we are talking...about, Guinness & Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in .London? 23 24 172 25 26 173 Was this the They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? 1 A. I cannot remember. I suspect that some of the 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 what their internal ...(INTERJECTION). 5 174 Q. A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A. 11 12 They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 175 13 14 Didn't you say that to me a few 176 Q. They were offshore already you think? A. Yes, most of the funds were offshore already. Q. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 18 177 Did you ever.have clients coming in A. Yes. Q. What would happen then? A. •At different stages, in the early stages I think 19 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 24 25 26 179 It is one and the same in the Then-they could be moved from Sterling. Q. Were they put offshore, the funds? A. Yes. Q. Where? A. All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey. But it could well have been ^C 1 180 2 3 Q. A. 181 Q. 4 trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in the Cayman Islands or in the 6 Channel Islands? 7 8 A. 182 Q. A. 9 10 183 Q. suggest this to them? 11 12 13 ' A. 184 Q. about it? 14 15 A. I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q. 20 22 If they didn't establish trusts, you are aware oi A. 186 Q. Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 ' ■ clients who transferred funds offshore? 19 21 I am not aware of any SHORT ADJOURNMENT a Appenasxl .Q - 18* October 2000 Mr. Jade Stakelum “Fairmont? Ballyronan Road Kilpeddcr Co. Wicklow Strtettv Private & Confldential - Addressee Only . . Dear Sir I refer to your letter of 11 October 2000, and I reply on my own behalf, and aa behalf of my colleagues, Mr. Justice Declan. Costello and Mr. Paul Rowan. * We now wish to examine you under oath concerning the matters set out in our two letters dated 30 August 2000 and 21 September 2000. To that'end, I propose that an interview would tike place in our offices at the above address, either on Wednesday 8 or on Thursday 9 November, at 10.00 a.m. Perhaps you would make contact with our secretary, Ms Frances Gaynor at fee above phone number to confirm either date, or to make mutually convenient alternative arrangements if those dates do not suit you • . We note your refusal to provide us with wwn« of your-clients prior to examination. I must point out to you that you are obliged by law to provide us with the information we have required of you. In that regard, I refer you to Appendix B of our two letters, which sets out our statutory powers. You will note that section 10(5) of the Companies Act 1990 imposes a duty upon you to comply with our requirement, and, in the case of a refusal to do so, mdces provision for the matter to be dealt with by the High Court I therefore repeat our requirement that you provide us with the names and addresses of those clients who you may have advised in relation to trusts in the Cayman or Channel Islands, or in relation to the transfer of funds to either of those islands. We require this information to be provided in writing prior to the interview. We have noted also your expressed intention to argue at interview that it would be invidious to disclose the identity of your clients. Once again, I must point out to you that you are obliged to do so, in compliance with our requirement The interview is not the proper forum in which to make submissions, and it is not our practice to entertain them. Yours faithfully “FAIRMONT” BALLYRONAN ROAD K1LPEDDER CO. WICKLOW JACK STAKELUM CHARTEREDACCOUNTANT . TELEPHONE: 2810646 FAX: 2810645 MOBILE: 087 2854660 . The Inspectors 3* Floor Trident House Blackrock * sr aok I-' 6 November, 2000 Dear Sirs, . With reference to your letter of the 18* October, and in particular the third paragraph, I should point out that I did not refbse as such to provide the information in question, merely that I should be afforded the opportunity to aigue why I should not be asked to divulge such information. The persona in question dealt with me on an understanding of confidentiality, and as the Inspectors will surely appreciate, it is difficult not to honour that confidentiality, particularly when one has been used, over one’s professional life, to honouring the confidentiality of Clients. " However, as you point out forcefully in your letter, you are not prepared to allow me that opportunity and you have referred to the legal position. In the circumstances, I attach a list of the names and addresses of the persons in question. YoursfeithfUlly, Eocli [en/Mm) 6 (?baa-143a Lina? . kl Tomm'l?haxerdea, TnlegCoxm I - 391559;:5 (5mm) JOHN J. STAKELUM ?Fairmont? Road, Kilpedder, Co. Wicklow. 21 February 2001. The High Court Inspectors, -, .r BMFloor? . fg? .w Trident House, Blackrock, Co. Dublin. Re: Inter-7m: with the Inspectors on 811112000 and 6/12/2000. Dear Inspectors, The content in sections [and 2 has been written-in order to add clari?cation to the information given in my Statement dated 22 September 2000. 1. The Consnltancy Business I set op In 3975. • •» In December 1975 I decided to set up a business that would provide a general finflnniqj Consultancy service to clients. I had identified the market need in Haughey Boland & Company during m y auditing work but more particularly during my receivership, liquidation and financial restructuring experience. The services I decided to focus on were: • • • • Preparation o f properly assembled requests for financing from banks. Preparation o f well constructed projected cash flow and profit and loss statements. Accompanying clients at meetings with their bankers. The presentation o f meaningful management accounts and the procedures within businesses for the timely production o f them. • Being a sounding board for all kinds o f operating issues - both problems and perceived opportunites. • Guidance on where to go and how to request professional services. • Helping businesses in difficulty to get back to profitability or to move logically to receivership or liquidation. . . • Acting for clients in the purchase or sale o f businesses. • Acting in a non-Executive Director capacity when requested to do so. Those were the principal sendee headings under which I operated in the name o f Business Enterprises Limited from December 1975 until my retirement on the 31 October 1998. This business was busy, demanding and successful. Typically, it occupied well over 10094 o f 50hour weeks. . . . 2. The service I gave to persons who wished to hold fbnds oflshore. Involvement with the savings o f clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalist basis. Towards thia my stipulations were: • • Funds would be deposited in licensed banks at rates of interest that would be competitive and market related. This empowered depositors to be satisfied concerning both safety and interest rates. All decisions in relation to movements in these funds would be conveyed to me directly and orally by the person concerned; ® I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling of investments. • I would oeither issuenor obtain, receipts for. movements in funds. Neither would I keep any ledger recprds, issue statements or engage in correspondence. • Information in relation to balances and rates of interest would be provided on an oral basis only. • Originally, no charge was envisaged for this service but over time it became necessary to recover costs on a case by case basis. My operatingprocedure for this service had but four components: • • • • A deposit account in G&M that I have described as a hotchpotch account A manual memorandum record I kept in my office under my personal control. A float account in AIB. A monthly reconciliation o f the sum o f the memorandum records with the sum o f the accounts) in G&M and any float balances. In the interest o f completeness perhaps I should add also: • • • • G&M would be aware o f the total funds I had in my hotdpotch account G&M would not be aware o f the names o f the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could surface as part o f another business transaction with the bank, e.g. a back-to-back ban. Some o f my clients would be aware generally that the funds they held offshore were in a G&M vehicle. Other clients would be aware that their funds were offshore but would have no awareness or care about the name o f the bank in which their money was deposited. Only I knew the names in the memorandum account and only I knew the ownership o f the balance in the float account kept in AEB. ' S. The information requested by Ms. Mackey on the 6 December 2000. t The information requested by Ms. Mackey on 6 December'2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list o f names I sent to the Inspectors on 6 November 2000. schedule had offshore deposits in G&M through my procedure. Yours sincerely, All on this Tom Clifford. O f b ta r a D e p o s its B ack to B a c k lo o n . D a ta D e p o s it O pened D a te D e p o s it S o u rc e o f F u n d s C lo s e d O fla h o re S o u rc e o f F u n d s Iris h P o u n d s . Y es. N o. O rc a 1 9 7 8 c . 1 9 8 7 /8 8 . P a rtia lly . P a rtia lly . NAME : Priacas iovwaan CradU Maainraaduia aUltad » t pp»n LI»Had. _« Equity Staka: ADDRESS : c/o, Builaaw Entarpriiaa Llwltad, 17, Clyda Road, BaU*rM*a, Dahlia 4. MWNQS / CB. Approval i Ytm / No Hmiuhn OMataM D atai WA _ OCCUPATION : tovaatmam Coaqpap. THS APPLICATION : TYPE : ( Daiaca aa appropriate ) AMOUNT i < M M M .......... U *n .......... - PURPOSE / DRAWDOWN t H- W ( E m H » / -Willi H i ’ RATE : .IfflL.rhaA.,.. FSB t — - If aaw or laeraaaad fartllrtaa, la frawdowm panalttad prior to coaplattoa a t aaouriqr T ' Working oapical YES / MOut TERM OP FACILITIES : - Fjmmatna for oaa yaar. SO U RC E or R E P A Y M E N T C uh REVIEW DATES: SULMM. ' t F lo w . SECURITY i Cuaraatoa J. J. Byrna and Ttaaaa CHAM. If addHlaaal or astalai faculty, la aacaiiv la ardar t • YES/MS* If No, f f m datalla • BACKGROUND NOTE / OUTLINE OP PROPOSAL J . Guarantor* am writ Inmm to flalnaaai ♦ Mafcoa and la tMi eaaa t e gGWIlMtMd i^ hMV RELATED FACtUTtES / BORROWERS i ■ Mlauta itSS,.... D * m ! d . Q . £ £ ' .... .............. MCMnRHBN feBABB. UtauM ............ flaM . . ........ Total Expoaira : *HO,OOOi Anpnvid Saoarity In ontar for Drawdown i Data : .............................. Q J i 4 Cab ( If o*ar U a total aapsawal kfrnmm* fcw • ....... ....... fM* f —---- * G U IN N E S S + M A H O N L T D U rn M 1T fti * *A la a H A W « 1 M * M 0 0 U m t) Tha SieriHnr, P tto c M In v w ta M n t* L ln tfta d , c / a , B m liw w B t to r p r la a t L ia t ia d , 17, C ly d a R o a d . B a lls b rid s a , "■M W * Sir, W o a ra p la a s a d t o c o n firm th a t w a a ra p ra p a ra d to a x to n d y o u r f a c ilit y f a r a f u rth a r p a rto d tu b ja c t to tb a fo llo w ta c M rm a a n d c o n d U k x * :- B o rro w o n P rln o a * Im a i t a w t t L im lt a d . A m o u n t: 11K X 0 0 0 .0 0 (O n a H u n d re d a n d E ig h t y Th o u a a n d P o u w M * S ta rltn g L f u rp o M ! T b a fa n d i h a v a a lro a d y b o a n p la c a d a t y e a r d is p o s a l in th a fo rm o r w a s tin g c a p it a l. Ta m s In a o o o rd a n c o w it h n o rm a l b a n k in g p ra e tie a a ll fu n d i ta k a n u p a ra ra p n y a b la o n d e m a n d b u t in a n y caa a n o t la c a r th a n 31 m M a y . M M . W a pro p o sa t o c o n tln u a c h a rg in g In t a r a n a t a N n d ra ta o f 1 8 % p a r a n n u m . In ta ra M w ill b o d s b ita d a n y o u r a c c o u n t a n d b a c o m a p a y a b la b y y o u o n th a u s u a l q u a rt o r ly d a ta * a n d a t m a tu r ity o f tfca lo o n . A * a a o n rity f o r th a lo a n w a a h a ll ro ta te ! th a fu a ra m a a sig n a d b y J . J . B y r a o a n d T h o m a s C lif f o r d . _. SRSiBW " .... . »— *■<»«— jffflf— *“ W a a ra ateaaad t o b a o f o M b c a a e * t o y o n a a d a a d o o a tao row ith i c o p y o f th i* f a c ilit y la tta r t a r ilf n a t a r a b y j mm jM b M lt a d tffn a to ria * ____ t o d r a t u r n th a ra b y e a a f lr a t a t y o * r •o etp u M * o f th a le a n o o th a t a r a t s ia n tio n a d . W a t o l l ra q u lra • c o p y o f a B e a rd R a a o lw io a a u th o r liin f th a c o n tin u e d Y o o n fa itb fM ly , ______ for OUMMM ♦ MAHON UMTim PM o v w y a r, B w k lm M a o a « a r. T . R . la a a o r * B a n k ia i M an a t o r . DOWNING, COURTNEY & LARKIN S O L IC IT O R S (IN C . E U G E N E D O W N IN G & C O ., A N D D O N A L J. C O U R T N E Y ) 84 , N E W S T R E E T , K IL L A R N E Y M IC H A E L C . L A R K IN , B.C.L., LL.B.. NOTARY PUBLIC Branch Office: K E N M A R E . C O . K E R R Y , IR E L A N D Dublin Office: 2 4 U P P E R O R M O N D Q U A Y , T E L . 064-31061. M A U R IC E C O F F E Y , B.C.L.. LL.B. D U B L I N 7. E -m ail: info@ dow ningslaw .com V .A .T . R eg. N o. I.E. 0 0 9 2 1 15L. D X 51 0 0 6 K IL L A R N E Y FA X . 064-33934. Our ref: MCL.MB 30 January 2002 Your ref: C/C23/NSPM Re: Mr. Thomas Clifford, The Kerries, Tralee, Co. Kerry. Dear Sirs, We write by reference to your letter o f the 14th December 2001 and have taken the instructions o f Mr. Thomas Clifford thereto. 1. At no time has Mr. Clifford had any direct contact with Ansbacher. 2. Mr. Stakelum managed certain monies on behalf of Mr. Clifford since in or about 1976 until in or about 1997/1998. Mr. Stakelum managed the monies offshore and during the period further monies were given to Mr. Stakelum from time to time. At no time was Mr. Clifford advised where his monies were held but he was advised, from time to time, by Mr. Stakelum as to the amount of money held by Mr. Stakelum to his credit. 3. Mr. Clifford was a Director of Princes Investments Limited which had a loan from G.M.I., which loan was subsequently repaid to G.M.I. by Princes Investments. Mr. Clifford has no knowledge, either direct or indirect, of that loan being secured by funds on deposit with a subsidiary of G.M.I. outside the jurisdiction. The writer acted for Princes Investments Limited in its appearance before the Moriarty Tribunal and supplied to the Tribunal evidence of the repayment of the loan by Princes Investments direct to G.M.I. 4. At no time has Mr. Stakelum, or indeed anyone else, communicated to Mr. Clifford that offshore monies standing to his credit were invested in or placed with Ansbacher. 5. It was alleged at the Tribunal that the repayment of the loan to Princes Investments was made by Ansbacher and/or College Trustees. Mr. Stakelum advised the Tribunal that the repayment of the loan from this source could not have involved Clifford funds in that it would have needed his permission and further that there was no benefit to Mr. Clifford in the suggested arrangement. Mr. Clifford repeats that he was never at any time a client of Ansbacher, rejects your preliminary conclusion that he was a client of Ansbacher, and in the light of what is detailed above he urges that you accept that he was not a client of Ansbacher. Inspectorate appointed by The High Court Ansbacher (Cayman) Limited, 3rd Floor, Trident House, Blackrock, Co. Dublin. Appendix XV (157) Mr William Clifford, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr William Clifford. a) Extract of transcript of evidence of Mr Jack Stakelum dated 8 November 2000. b) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. c) Letter of 6 November 2000 and enclosure from Mr Stakelum to Inspectors. d) Letter of 21 February 2001 and enclosures from Mr Stakelum to Inspectors. e) Guinness and Mahon credit memo of 3 May 1985. f) Letter of 3 May 1985 - Guinness and Mahon to Princes Investments Limited. g) Guinness and Mahon credit memo of 7 May 1985. h) Letter of 10 April 1975 - Guinness and Mahon to Princes Investments Ltd. 23 147 24 Q. When did that start? A. I am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service r\ 1 A. If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 Q. Could you not be a little bit more specific because 10 you know these terms, I don't know. 11 explaining them to us? 12 A. Would you mind If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 16 17 151 18 19 20 This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in . the sense of what interest rate...(INTERJECTION). 152 21 22 Q. 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 They were asking me whether I could monitor those funds on their behalf. 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say 'We have funds offshore' wherever 31 v 1 they might have been 'Can you look after these funds 2 for me.' 3 155 Q. 4 What did that mean? A. 5 Would you endeavour to get the best interest rate. Would you monitor the funds. ' 6 7 "Can you look after these funds." 156 Q. Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial 10 institution? A. 11 I don't think they would come in and say 'We have 12 funds. 13 financial institution.' 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other I think a discussion would Q. What does that mean? A. It.means that they might not want to correspond 19 directly with whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 28 158 And that Q. What did you do then? A. I would probably advise them at some stage that there would be a facility available through Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 in this connection? 5 ^ A. Des Traynor. 7 — 8 were — I would have said 'I have a client for the most part he wouldn't know who my clients that wishes to have funds monitored abroad 9 by me.' 161 Q. Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 ^ It means I would probably have contacted 6 10 What does that mean A. You have a client. Des Traynor is to give me an account number, a 14 reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — 18 moved to a receiving bank. 19 162 r the timely production o f them. Being a sounding board for all kinds o f operating issues - both problems and perceived opportunites. Guidance on where to go and how to request professional services. Helping businesses in difficulty to get back to profitability or to move logically to receivership or liquidation. . . Acting for clients in the purchase or sale ofbusinesses. Acting in a non-Executive Director capacity when requested to do so. Those were the principal service headings under which I operated in the name o f Business Enterprises Limited from December 1975 until my retirement on the 31 October 1998. This business was busy, demanding and successful Typically, it occupied well over 100% o f 50hour weeks. 2. The service I gave to persons who wished to hold Hinds offshore. Involvement with the savings o f clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalist basis. Towards this my stipulations were: • • • Funds would be deposited in licensed banks at rates of interest that would be competitive and market related. This empowered depositors to be satisfied concerning both safety and interest rates. All decisions in relation to movements in these funds would be conveyed to me directly and orally by the person concerned; I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling o f investments. n • • • 1 would neither issue'nor obtain receipts for movements in funds. Neither would I keep any ledger recprds, issue statements or engage in correspondence. Information in relation to balances and rates of interest would be provided on an oral basis only. Originally, no charge was envisaged for this service but over time it became necessary to recover costs on a case by case basis. My operating procedure for this service had but four components: i • • • • A deposit account in G&M that I have described as a hotchpotch accomit. A manual memorandum record I kept in my office under my personal control. A float account in AEB. A monthly reconciliation o f the sum o f the memorandum records with the sum o f the accounts) in G&M and any float balances. In tie interest o f completeness perhaps I should add also: • • • '• G&M would be aware o f the total fluids I had in my hotchpotch account G&M would not be aware o f the names of the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could surface as part o f another business transaction with the bank; e.g. a back-to-back ban. Some o f my clients would be aware generally that the funds they held offshore were in a G&M vehicle. Other clients would be aware that their funds were offshore but would have no awareness or care about the name of the bank in which their money was deposited. Only I knew the names in the memorandum account and only I knew the ownership o f the balance in the float account kept in AIB. The information requested by Ms. Mackey on 6 December'2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list o f names I sent to the Inspectors on 6 November 2000. schedule had offshore deposits in G&M through my procedure. Yours sincerely, All on this SCHEDULE 1 Name. O?dm Buckie Odom Dar-Doped! Sam-ofme SourcoofFunds Doped:- Badtloan. Oponod Cloud Offshore Irish Pounds. William aim Ya. No. m1m. cum-wan: By wlfo c. 1907!?. NI. None. NAM E : P r ln c a a l a v a a t a a n A D D R ESS : B m ittH * P m « rp r ta “ * L J ■ ! » < ( , 1 7 , C l y d a R a a 4 B a J la b rid fa * D u b U a 4 . Wm r r t l w a q n J i l t ^ Ijl W t i l W i l l l i li i'll!— DRAW DOW N AM OUNT : ................ RA TE ! ' ■ M f r , / C x M M to n Z f l w h # * * , f flfc f H a d ...... or F A C IL IT IE S E t t a m lm 1 FOR t / YES * TE R M “ If H t of laeraw * taUMafc la d ra w d o w a p ifw iM prior to cnaplarioa o t a o o a rity T ' W o rk la g c a p ita l r ^ V o* y N o n td N /A D a ta : { Dalata u tpproprlota ) M w ....... ............ ' / C & A p p ro v a l i trnmtatim O ta M _ in v a ttm a n t C o a tp a a y . T H B A P P L IC A T IO N : PURPOSE I E q u ity S t a k a : c/9, H JS M O S / 'O C C U P A T IO N s TY PC : C r a d lt M a a u r a n d u a M il l a d b jr t Po>n U a i lt a d . > . R E V IE W D A T E S i tm fo r oa a y a a r . M Bh : i ' • SOURCE o r REPAYMENT i C a * h Flow. , If aMtlonat ov wtoting S E C U R IT Y t la s U ta ft G u a ra n te e J . J . B y rn e a n d T h o r n t C U ffe rd l la a a c a rltjr ia ordar T • YES / N&r U Na, gtva dataJU BACKGROUND NOTE / OUTLINE OT PROPOSAL I ara U oomidorad G u a r a n to r * taowa to OttbMM . Uaboa and la tfaU ca« tfa. mteohty RELATED rAOUTtES / BORROWERS! ■ Minute t t S U — VkfmhiSljbZ' BQAW> Total Expotwt: 1180,000. • Appvpvad Security in ordar for Drawdowi i .... ......... ..... * OM. * Ca. ( if o«ar t l a total « fH M ) i f 1**** • .............. I> rr t .... —■ n G U IN N E S S + M A H O N L T D 1* (W h n « M M M k I P A ta t H A T * 7N 044 0 0 U r n ) 3 rd M a y , 1965. O u r R o ft P f f D / S C T h e S e c r e ta r y , P rfn a a a In v a a ta o n ta L im it e d , c / a , B u rt— E n n w p rta a * U n i t e d , I T , Cly lr_ « •— O O tS Q Tho«* Clifford. PURPOSE / DRAWDOWN : If mw or 1norland (•dUtiM, la drawdown parmLttad prior to coaiplatiaa of aaenrtqr T Worfcta capital YES TERM or fAOLmES : Egtamkm for am 7 t MBs . REVIEW DATES t *■* 3L&UM. . SOURCE o r REPAYMENT : BACKGROUND NOTE / OUTLINE Of PROPOSAL I G« w t« « wU to w M aitaMM * Mahon aad ta thU caaa et» -cu rlt, ISOOMMtrM MtQIMMb R E L A T E D r A C f lU T IE S / BORROW ERSi ' ...... ........................., T o ta l . E x p o w ra : ^ t r -3 .- £ 8 0 ,0 0 0 . a w U n l t ( i ) R a c o rd a d b y s . . . » » » — a ir t t y in o rd a r fo r D ra w d o w n i ■ O a tn i — ^ a r — r* , ~ v .< / 1 : A p p ro v e d < U L ft C a . ( ( f a w (1 m a v M u ra ) 't m M m 1 Kw . . t o ta l rW » t . „GUINNESS & MAHON LTP kMMOMaCOlUS. 17.C ollege G r e e n . DUBLIN, 2 . • R O. BOX SSA. RCaiSTCRCO OFFICE. m a. n o . io m c Our Ref: 10th April, 1975. PO'D/MR. The Secretary, Princes Investment* Liad.ted, 60/62, Aaiens Street, DtTBLiy 1. Dear Sir, • ‘ On the instructions of Mr. Traynor, we write to confirm that we are prepared to make available to you a facility, subject to the following terns and conditions: (1) Maxisum Aaount: £116,000 (One Hundred and Sixteen Thousand Pounds). . (2) Tern: All funds advanced are repayable on demand but in any case not later than the 6th March, 1976. (3) Drawdown: The funds have already been taken up. (4) Interest: Ve propose charging Interest on the facility at 11$% per annua. Interest will he debited by us to the Account on the 30th June, 30th September and 31st December annually and at maturity of the Loan. Ve shall apply to you immediately after the aforementioned dates for payment of interest (5) Security: As security, we shall require a Fora of Guarantee signed by Mr. J. J. Byrne, Hr. Vllliam Clifford and Mr. Thomas Clifford. The relative Form of Guarantee is enclosed for completion and return at your earliest convenience. n (6 ) Reserve a c q u ire m e n ts: . I f th e re a h u ll be u r in c re a s e i n th e c o s t to us o f making o r m a in ta in in g th e Loan by an aaouat which ve dees m a te ria l r e s u lt i n g I r o n a n ; changes in the re s e rv e o r l i q u i d i t y requirem ents to w hich t h i s Bank l a o r nay be s u b je c te d , then we a h a ll be e n t i t l e d to c a l l f o r payment o f a d d it io n a l In t e r e s t o f such amount as we s h a l l c e r t i f y as the amount re q u ire d to ooapensate us f o r such In cre ased co s t w ith e f f e c t from the d ate o f n o t i f i c a t i o n . Ton s h a ll be a t l i b e r t y w it h in one month s ifte r such n o t i f i c a t i o n and w ith o u t payment o f any premium o r p e n a lty to repay th e f u l l amount - o f th e Loan o u tsta n d in g to g e th e r w it h ln te re s * • a t the r a t e a p p ly in g p r i o r t o n o t i f i c a t i o n . Ve enclose h e re w ith a copy o f t h i s f a c i l i t y l e t t e r f o r s ig n a tu r e by y o u r a u th o ris e d s ig n a t o rie s and r e t u r n In due co u rs e , th e re b y o o n f lrm ln t acceptance o f the f a c i l i t y on the te rn s s ta te d . Ve s h a l l a ls o r e q u ir e a copy o f a Board B e s o lu tlo n co n firm in g th e b o rro w in g . Ve a ls o enclose a Torm o f Mandate and S ig n a tu re Cards f o r co m p le tio n and r e t u r n c o v e rin g th e o p e ra tio n o f a Banking Account. When r e t u r n in g the aforem entioned documents to u s , perhaps, you would a ls o k i n d l y a rra ng e to l e t us have a copy o f yo u r Memorandum ft A r t i c l e s o f A s s o c ia tio n to g e th e r w ith a photocopy o f the C e r t if ic a t e o f In c o r p o r a t io n . ‘ To u rs f a i t h f u l l y f o r GUXBNS88 * NASON LIM ITED . t P . O 'D w yer, Loans O f f i c e r . ■6 B . jr. lio L o u g h lln , .A u th o ris e d S ig n a to ry . d ' A cce n te d on b e h a lf o f P rin c e s In ve «to e n t«__L im ite d WiIlian Clifford / Appendix XV (158) Ms Olga Gray 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Olga Gray. 3) Extract of transcript of evidence of Mr Jack Stakelum dated 8 November 2000. b) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. c) Letter of 6 November 2000 and enclosure from Mr Stakelum to Inspectors. d) Letter of 21 February 2001 and enclosures from Mr Stakelum to Inspectors. 147 Q. When did that start? A. I am inclined to believe 1976 but it might have been 1977. I would have started on my own in late 1975. I only had one year of operations in 1975. 148 Q. Would you tell us what the arrangement in a general way was with Mr. Traynor. operated? How was this service 1 A. If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 Q. Could you not be a little bit more specific because 10 you know these terms, I don't know. 11 explaining them to us? 12 A. Would you mind If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 16 17 151 18 Q. This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in 19 20 the sense of what interest rate...(INTERJECTION). 152 21 22 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 They were asking me whether I could monitor those funds on their behalf. 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say 'We have funds offshore' wherever 31 1 they might have been 'Can you look after these funds 2 for me.' 3 155 Q. 4 What did that mean? A. 5 Would you endeavour to get the best interest rate. Would you monitor the funds. ' 6 7 "Can you look after these funds." 156 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial Q. 10 institution? A. 11 I don't think they would come in and say 'We have 12 funds. 13 financial institution.' I think a discussion would 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other Q. What does that mean? A. It means that they might not want to correspond 19 directly with whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 And that Q. What did you do then? A. I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 32 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 in this connection? 5 A. It means I would probably have contacted 6 Des Traynor. 7 — 8 were — 9 by me.' 10 What does that mean 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients that wishes to have funds monitored abroad Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A. You have a client. Des Traynor is to give me an account number, a 14 reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — might be 18 moved to a receiving bank. 19 162 Q. This is very important. Those funds — If you don't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 33 1 164 Q. 2 to be placed? 3 A. I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. 8 ^ What was the account, in whose name was the account All I am saying is You must have known the financial institution in which your clients1s funds were going to be placed? 9 A. The only answer I can give to that is I don’t recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. 13 Tell me some of them that were used that Mr. Traynor would have told you about. .14 Give me the names of some of those, Mr. Stakelum? 15 A. It is very difficult unde? oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 1 9 so etc. etc.. I don't know. But I am not absolutely positive of 20 that. 21 If it was dollars it might be something else. 22 167 Q. 23 It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? 24 A. I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 29 168 Q. I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. 5 6 That is not wanting to be uncooperative, I just cannot remember. 169 7 8 I just cannot answer that. 170 Q. Why can't you remember? A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 9 ’ the Guinness & Mahon subsidiaries in Cayman or in 10 the Channel Islands? 11 A. I don't think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. I am not too sure. It may have been the account of Guinness & Mahon in Dublin or Guinness & Mahon in London. 18 Was this the .offshore bank.we are talking about, Guinness & .Mahon 19 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 24 172 25 26 173 They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? 1 I cannot remember. I suspect that some of the 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 what their internal ...{INTERJECTION). 5 ^ A. 174 Q. A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A. 175 13 14 They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 11 12 Didn't you say that to me a few 176 Q. They were offshore already you think? A. Yes, most of the funds were offshore already. Q. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 IB 177 19 Did you ever have clients coming in A. Yes. Q. What would happen then? A. At different stages, in the early stages I think 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 24 25 26 179 It is one and the same in the Then-they could be moved from Sterling. Q. Were they put offshore, the funds? A. Yes. Q. Where? A. All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey. But it could well have been 36 1 180 2 3 181 Q, One or the other? A. Yes, I assume one or the other. Q. Did any of your clients to your knowledge establish 4 trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in the Cayman Islands or in the 6 Channel Islands? 7 8 182 9 10 183 A. Not to my knowledge. Q. None of them told you that they had done this? A. No. Q. Mr. Traynor didn't tell you that he was going to 11 suggest this to them? 12 13 184 A. No. Q. You are pretty certain on that or are you doubtful 14 about it? 15 A. I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q. 19 ^ ‘ 22 ' If they didn't establish trusts, you are aware of clients who transferred funds offshore? 20 21 A. 186 Q. Yes, that's right. We will break now for a cup of coffee, Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 I am not aware of any SHORT ADJOORMflanf (1589(1100 Our Ref: C/S1G/NM 18* October 2000 Mr. Jack Stakelum ‘Tainnonf BaUyronan Road Kilpedder Co. Wicklow Strictly Private & CopM m tiil -A ddressee Only . . . Dear Sir I refer to your letter of 11 October 2000, and I reply on m y own behalf, and on behalf of m y colleagues, Mr. Justice Dedan Costdlo and Mr. Paul Rowan. * W c now wish to examine you under oath concerning thematters setoutin ourtwo letters dated 30 August 2000 and 21 September 2000. To that'end, I propose that an interview would take place in our offices attie above address, eitheron Wednesday 8 or on Thursday 9 November, at 10.00 a.m. Perhaps you would make contactwith our secretary, Ms Frances Gaynor atthe above phone number to confirm eitherdate, or to make mutually convenient alternativearrangements if those dates do not suityou. ' ' /-*« W e note your refusal to provide us with names ofyour-clientspriorto examination. Imust point out to you thatyou are obliged by law to provide us with the information we have required of you. In that regard, I refer you to Appendix B of our two letters, which sets out our statutory powers. You will note that section 10(5) of the Companies Act 1990 imposes a duly upon you to comply with our requirement, and, in the case of a refusal to do so, mdces provision for the matter to be dealtwith by the High Court I therefore repeat our requirement that you provide us wife the names and addresses of those dients who you may have advised in relation to trusts in the Cayman or Channel Islands, or in relation to the transfer of funds to either of those islands. W e require this information to be provided in writing prior to the interview. W e have noted also your expressed intentionto argue atinterview that itwould be invidious to disclose the identity of your dients. Once again, I must point out to you thatyou are obliged to do so, in compliancewith our requirement The interview isnot the proper forum in which to make submissions, and itisnot our practiceto entertainthem. Yours faithfully “FAIRMONT" BALLYRONAN ROAD K1LPEDDER CO. WICKLOW JACK STAKELUM C H A R TE R E D A C C O U N TA N T TELEPHONE: 2810646 FAX: 281064S MOBILE: 087 2854660 The Inspectors 3* Floor TridentHouse ne a w *- Blackrock o n . mrm.TK 6 November, 2000 Dear Sirs, With referencetoyour letterofthe 18* October, and isparticularthethird paragraph,Ishould pointoutthatIdidnot refiiseaa suchto providethe informationin question, merely thatIshould be affordedtheopportunityto aiguewhy Ishould notbe asked to divulgesuch information. The perrons inquestion dealtwith me on an understanding ofconfidentiality, and astheInspectorswillsurelyappreciate, itiadifficult notto honourthatconfidentiality,particularlywhen one has been used, over one’s professional life,tohonouring the confidentialityofClients. " However, asyou point outforcefullyinyour letter,you arenotpreparedtoallow me thatopportunityand you have referredtodielegalposition. Inthecircumstances, I attacha listofthenames and addresses ofthe personsinquestioa Yours faithfiiUy, End; Wtotu?e: 4277M 6 ww? r? on. I <1 JOHN J. STAKELUM ‘‘Fairmont’* Ballyronan Road, Kilpedder, Co. Wicklow. . 21 February 2001. The H igh Court Inspectors, 3ri Floor, . Trident H ouse, Blackcock, Co. Dublin. ‘ \j>g . . jgjfl . Re: Interview s w ith the Inspectors on 8/11/2000 and 6/12/2000. Dear Inspectors, The content in sections 1 and 2 has been written in order to add clarification to the information given in m y Statement dated 22 September 2000. 1. T he C onsultancy B usiness I set np in 1975. , *• • i In Decem ber 1975 I decided to set up a business that 'would provide a general financial Consultancy service to clients. I had identified the market need in Haughey Boland & Company during m y auditing work bat more particularly during ray receivership, liquidation and financial restructuring experience. The services I decided to focus on were: • Preparation ofproperty assembled requests for financing from banks. • • • • • • • • Preparation o f w ell constructed projected cash flow and profit and loss statements. Accompanying clients at m eetings with their bankers. The presentation o f meaningful management accounts and the procedures within businesses for the tim ely production o f them. B eing a sounding board for all kinds o f operating issues - both problems and perceived opportunites. Guidance on where to go and how to request professional services. Helping businesses in difficulty to get bade to profitability or to m ove logically to receivership or liquidation. . . Acting for clients in the purchase or sale o f businesses. A cting in a non-Executive Director capacity when requested to do so. Those w ere the principal service headings under which I operated in the name o f Business Enterprises Lim ited from Decem ber 1975 until m y retirement on the 31 October 1998. This business w as busy, demanding and successful. Typically, it occupied w ell over 100% o f 50hour w eeks. • 2. T he service I gave to persons w ho w ished to hold food s oflshore. Involvem ent with the savings o f clients in any rapacity whatsoever was not envisaged in my original plan. W hen in due course I agreed to provide a service I required that it be on a m inim alist basis. Towards this my stipulations were: • • Funds w ould be deposited in licensed banks at rates o f interest that would be com petitive and market related. This empowered depositors to be satisfied concerning both safety and interest rates. A ll decisions in relation to movements in these funds would be conveyed to me directly and orally by the person concerned; • I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling of investments. • I would neither issue'nor obtain.receipts for movements in funds. Neither would I keep any ledger recprds, issue statements or engage in correspondence. • Information in relation to balances and rates of interest would be provided on an oral basis only. • Originally, no charge was envisaged for this service but over time it became necessary to recover costs on a case by case basis. My operating procedure for this service had but four components: • • • • A deposit account in G&M that I have described as a hotchpotch account A manual memorandum record I kept in my office under my personal control. A float account in ADB. A monthly reconciliation o f the sum o f the memorandum records with the sum o f the account(s) in G&M and any float balances. In the interest o f com pleteness perhaps I should add also: • • • • G&M would be aware o f the total funds I had in my hotchpotch account G&M would not be aware o f the names o f the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could surfece as part o f another business transaction with the bank, e.g. a back-to-back ban. Some o f my clients would be aware generally that the funds they held offshore were in a G&M vehicle. Other clients would be aware that their funds were offshore but would have no awareness or care about the name o f the bank in which their money was deposited. Only I knew the names in the memorandum account and only I knew the ownership o f the balance in the float account kept in AEB. 5. The inform ation requested by M s. M ackey on th e 6 D ecem ber 2000. The information requested by M s. Mackey on 6 December' 2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list o f names I sent to the Inspectors on 6 November 2000. schedule had offehorc deposits in GAM through my procedure. Yours sincerely, A ll on this SCHEDULE 1 Nume. Offshore Buckie Damped! mowed: ?_Sourcaumeds Deposit Badman. Opened Cloud Offline Irid?aPomda 0133 Gray. Ya. M3. Md 19808. c. 1987138. All. NCIIB. Appendix X V 1. (15 9 ) M r G e r a r d K e a n e Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Gerard Keane. a) Transcript of evidence o f Mr Gerard Keane dated 30 May 2000. b) Unsworn statement o f Mr Gerard Keane dated 3 May 2000. c) Internal Guinness and Mahon banking report of February 1980. d) Application to make payment to a non-resident of the state dated 28 February 1990. e) Cheque in favour o f Beesley Properties Inc of 26 March 1990. f) Letter o f 27 March 1990 - Ansbacher Limited to Guinness and Mahon. g) Internal print-out o f GMCT/College - 31 May 1988 to 20 June 1988. h) Extract o f transcript o f evidence o f Mr Jack Stakelum dated 8 November 2000. i) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. j) Letter o f 6 November 2000 and enclosure from Mr Stakelum to Inspectors. k) Letter of 21 February 2001 and enclosures from Mr Stakelum to Inspectors. 1) Extract from a statement dated 22 September - Mr Jack Stakelum to the Inspectors. UNDER OATH ON TUESDAY, 30TH MAY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. GERARD KEANE Represented by: MR. E. BUTLER L.K. SHILEDS SOLICITORS 39/40 UPPER MOUNT STREET DUBLIN 2 1 2 AS FOLLOWS: 3 4 5 MR. JUSTICE COSTELLO: 6 Mr. Keane, we will start our interview then and I 7 will introduce myself. 8 my right is Ms. Mackey and on my left Mr. Rowan and 9 we are the inspectors, as you know, appointed by the I am Declan Costello and on 10 High Court to investigate the affairs of the 11 company. 12 this, of course, is not a court and it is not a 13 tribunal. 14 questions and we will ask Ms. Cummins to administer 15 the oath to you in a moment. I should explain to you Mr. Keane that It is an interview and we will ask you 16 17 If during the course of the questions you wish to 18 take legal advice, please tell us and we will stop 19 asking you questions and you can take legal advice 20 and similarly should your solicitor in the course of 21 the questioning wish to advise you on any matter, he 22 can indicate this to us and we will stop and he can 23 advise you so you understand how we progress? 24 25 26 27 28 29 A. Yes. MR. JUSTICE COSTELLO: Mr. Keane, I will ask Ms. Cummins to administer 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Keane, could I ask you to begin by just briefly 6 giving an outline of your business career and the 7 companies through which it was carried on? 8 A. 9 2 Q. 10 11 From the very beginning? Just briefly, but briefly, how did you start in business and what was your business Mr. Keane? A. Initially I worked for a company called Hodges many 12 years ago and then I went on to another company 13 called Monsell Mitchell where I was a wall coverings 14 manager. 15 the company at the moment in partnership with two 16 other people and it just went on from there. 17 3 Q. 18 A. 19 4 Q. 20 A. 21 5 Q. 22 A. 23 6 Q. 24 What was the name of the company? Gerry Keane Limited. Was it Gerry Keane? G-E-R-R-Y Keane. Gerry Keane Limited, yes? Gerry Keane Limited. When was that formed, Mr. Keane, do you remember just roughly? 25 A. 26 7 Q. 27 A. 28 8 Q. 29 From then on I started up, the current, 1972 I think. Yes? 1972. What was the business it carried on? 1 9 Q. 2 3 besides yourself? A. 4 5 10 Q. A. 11 Q. 10 A. 11 12 Q. 12 A. 13 13 Q. 14 A. 15 14 Q. 16 A. 17 15 Q. 18 Eventually Mr. Quinn and I bought out the third When would that have been about? It would have been about two years later. I see, around 1974? Around 1974/1975, yes. Yes? Then eventually I actually bought Mr. Quinn out. When was that? That would have been about 1983/1984. You continued on the business, where was the business carried on from? 19 A. 20 16 Q. 21 A. 22 17 Q. 23 A. 24 18 Q. 25 A place in 14 Talbot Street. 14 Talbot Street? Yes. Is that a retail shop there? Retail, yes. You have a retail shop and where Mr. Keane have you been living? A. 27 29 As it developed then partner. 9 28 Of course, this was initially. what happened? 8 26 Initially it was Bill Quinn, myself and you will have to give me a moment. 6 7 Who were the other shareholders in the company I was living originally in Mount Alton in Rathfarnham. 19 Q. Yes? 1 lived in various apartments for a while and 2 eventually bought 54, Heytesbury Lane. 3 20 Q 4 A 5 21 Q 6 A 7 22 Q 8 9 A 23 Q 12 A 13 24 Q 14 A 15 25 Q 16 I think around 1988/1989. Can you be a bit more definite on that, can you Let me think now. That would have been I would say Mr. Keane, I would just like t o ...(INTERJECTION)? Sorry, Sean Nolan, Nolan is the other man. He is the other man? Yes . Mr. Nolan was with you then in the business for a couple of years? A 18 Yes, they were actually in the financial end. 26 Q Just arising from that, you must have had a firm of accountants to do your accounts Mr. Keane? A 22 Our accounts were always from the start done by Niall Brophy. 23 27 Q 24 A 25 28 Q 26 A Niall Brophy? Yes . Did you have a solicitor? Nothing, not a regular solicitor, no, I would not 27 say. 28 like a chap called Daire Walsh. 29 I actually ran the business. 20 21 When did you buy it do you remember? it was 1988. 11 19 That is my house. remember which year it was? 10 17 That was your house then was it? 29 Q We had a fellow who handled bits and pieces, 1 2 30 Q 3 A 4 31 Q 5 A 6 32 Q 7 A 8 9 33 Q Daire Walsh? Yes . Had you any other solicitor who acted for you? The latest was the purchase of a warehouse and it Mr. Keane, would you just look at the unsworn statement that you sent to us (Exhibit 1)? 11 A 12 34 Q 13 Yes . Do you see that in the third paragraph: "I can only speculate that monies invested by Mr. Jack Stakelum might have been deposited." 14 15 Why do you say that? 16 A 17 35 Q 18 A 19 Because I do not actually know. No but why do you speculate they might have been? Because in the case that I knew that he had monies and that I knew it was somewhere. 36 Q 21 22 It was Daire Walsh. was a chap called John Nelson from Templeogue. 10 20 Can you remember the firm he was in? Yes but what made you think it might have been in Ansbacher? A Because I did not know what Ansbacher was until I 23 got a letter from the Revenue. 24 it. 25 MR. KILLEEN: 26 27 28 29 I had never heard of If we could perhaps interrupt and clarify the situation? 1 2 3 moment with our client 4 then? 5 MR. JUSTICE COSTELLO: 6 Yes, if it is to give him advice, please go ahead. 7 SHORT ADJOURNMENT 8 9 A The only reason I am speculating there is because 10 you actually wrote to me in connection with 11 Ansbacher. 12 37 Q MR. JUSTICE COSTELLO: I see but did Mr. Stakelum not tell you 13 14 what he did with the money you gave him? 15 A 16 38 Q 17 A 18 39 Q No, never. Not at all, ever? Ever. Tell me a little bit more about how that came about, 19 that arrangement came about. 20 paragraph: 21 You say in the next 23 "I have asked Mr. Jack stakelum to furnish to me any books or records pertaining to funds held with him for the purposes of investment from approximately 1983/1984 until 1996." 24 Was that when you started with Mr. Stakelum? 22 25 A In my recollection it would have been around 26 1983/1984, yes. 27 Tell me how that came about? 28 It would have been around the time of the change of 29 partnership when Mr. Quinn and I parted. I was 1 2 41 Q. 3 A. 4 By whom? By a gentleman that knew both of us in the golf club. 5 42 Q. 6 A. 7 43 Q. 8 A. 9 44 Q. 10 A. Who was it? It was a fellow called Bertie Wojmar. Sorry? Wojmar. W-O-J-M-A-R. Bertie Wojmar. Wojmar, yes? Yes and he introduced me to Jack and suggested that 11 he might be of help to me because I was more on the 12 sales side of the company. 13 45 Q. 14 A. In what way a help? To help me go to the banks and talking to the banks 15 about money and all the rest, as a financial 16 advisor. 17 46 Q. 18 A. 19 47 Q. 20 A. 21 Yes. That was when in 1982/1983? As far as I can remember it would have been around then, yes. 22 48 Q. 23 A. 24 4 9 Q. 25 A. 26 50 Q. 27 A. 28 51 Q. 29 To advise you financially? Did you go to see Mr. Stakelum? I did. Where did you see him? In Clyde Road. In his offices in Clyde Road? 17, Clyde Road, yes. What was the terms on which you engaged with him, 1 2 52 Q. 3 A. What was the service he was to give you? He was to look at the banks, keep the banks happy 4 whenever he was going on alright and if I needed 5 loans or whatever he would do all the negotiation 6 and did it very successfully. 7 53 Q. 8 A. 9 54 Q. 10 Negotiate loans for you? Yes. Yes, that is not everything, Mr. Keane, there must have been more arrangements made? 11 A. 12 55 Q. In what way? Just from what you say in your statement. 13 "I have asked Mr. Stakelum to furnish to me any books or records for the purposes of investment from approximately..."? 14 15 16 A. 17 56 Q. 18 A. 19 57 Q. 20 I did pass some monies. That is what I want you to tell me about Mr. Keane? Sorry, I did pass him some monies. Tell me about -- no, no. Mr. Keane, listen to me, this is a very serious investigation? 21 A. 22 58 Q. Yes, I understand that. It is no good being vague, you passed him some 23 monies. 24 to the court is to get full details of these matters 25 so I want full details now please? 26 A. 27 59 Q. It is no good saying that to us. That is the way it went. Please Mr. Keane. Our duty We passed.. (INTERJECTION). Mr. Keane, can you listen to the 28 question. 29 you had with Mr. Stakelum about you giving him I want you to describe the conversation 1 monies and what he was proposing to do with the 2 monies and when those conversations started? 3 A. 4 60 Q. 5 A. 6 61 Q. 7 A. 8 62 Q. 9 10 In 198 --? I would say in 1983, in that area, yes. That was in his? It would have been in Clyde Road, yes. Tell me what you said to him and what he said to you? A. 11 I just said that to him that if I had some...(INTERJECTION). 12 63 Q. 13 A. 14 64 Q. 15 A. 16 65 Q. 17 A. 18 66 Q. 19 A. 20 Sorry? I said to him if I had some money. If I had some money, what? To put it away. Who would put it away? Would he put it away for me. What do you mean by that? In other words, put it away wherever the monies were to avoid 21 67 Q. 22 A. 23 68 Q. 24 Tax? Yes, probably, yes. What made you think that Mr. Stakelum might help you to avoid tax? 25 A. 26 69 Q. 27 A. 28 7 0 Q. 29 I would say they started fairly soon after. Obviously it must have been said to me by somebody. By whom do you think? I could not remember that. Pardon? 1 71 Q. 2 A. 3 72 Q. 4 5 This must have been a fairly important point? It must have been. It must have been himself. Himself, he might have said to you that he could, if you had funds he could help you put them away? A. 6 Yes, I would say so. MR. KILLEEN: 7 I think if we could have one moment with our client 8 because his recollection is not as good? 9 MR. JUSTICE COSTELLO: 10 No, I am sorry, I must explain what your role is 11 and what our role is and what the witness's role is. 12 You are not entitled to tell the witness pieces of 13 evidence that he is forgetting. 14 them, that is fine and he can tell us later on, he 15 has forgotten but you can advise him on any legal 16 point and if his recollection is not good on any 17 point, he can tell us. 18 MR. BUTLER: 19 If he is forgetting Judge, I do not wish to involve myself 20 unnecessarily in this but I would 21 and I hope it is regarded as helpful. 22 the way the question is being put makes it quite 23 difficult for the witness to deal in the way that 24 you would wish him to deal with the question. 25 MR. JUSTICE COSTELLO: 27 29 Very well. I think that I am handling this interview Mr. Butler. 26 28 make a suggestion 73 Q. MR. BUTLER: I fully appreciate that. MR. JUSTICE COSTELLO: I am handling this 1 such questions as I think are necessary. 2 continue the interview now. 3 Mr. Keane, as far you can, in relation to the 4 arrangements you had with Mr. Stakelum? 5 A. 6 7 4 Q. 7 I want you to help me Yes. About the funds. You said that he would put them away? 8 A. 9 75 Q. 10 A. 11 76 Q. 12 13 We will Yes. Did he tell you what he would do? He did not tell me exactly where he would put them. No, not exactly but did he tell you what he would do? A. 14 He would just say that -- I would just give him the...(INTERJECTION). 15 77 Q. 16 A. 17 78 Q. 18 A. 19 79 Q. No but did he tell you what he would do? He said he would put it away, yes. Where? He never said where. Did you know it was going to be invested, for 20 example, in Ireland or put on deposit in Ireland or 21 outside ireland? 22 A. To be absolutely truthful I thought it would be 23 going to Jersey. 24 always in Jersey but that was never clearly said to 25 me . 26 80 Q. 27 A. 28 81 Q. 29 That was what I thought it was What made you think that? I thought that is what was to be done. Jersey, why did you think the money was going to 1 A. I thought that is where all this sort of money went. 2 I was not that experienced at the time and I thought 3 this is where all this sort of money went to, to 4 Jersey or the Isle of Man. 5 82 Q. You gave him funds and that was in 1983, did you 6 continue then giving him funds from time to time 7 over the years? 8 A. 9 83 Q. Yes. What about the use of the funds that you gave him, 10 Mr. Keane, what happened to that? 11 the funds you gave him? 12 A. 13 8 4 Q. 14 A. 15 85 Q. 16 A. 17 86 Q. How did you use Very very little actually. How did you do it? How did I spend it you mean? No, no, how did you get the funds? Eventually I think 1996. No, no, I am not asking you about eventually, 18 Mr. Keane, I am just asking you throughout the 19 years, how did you get the funds? 20 A. 21 87 Q. 22 A. 23 88 Q. 24 A. 25 89 Q. I did not get them. You did not get them? No. They were put away? Put away. What about any of the interest or the profits that 26 might have been earned on the funds, were they paid 27 to you? 28 A. 29 90 Q. They actually added that on monthly. Monthly, did they? 1 2 91 Q 3 A 4 figure. 5 92 Q 6 A 7 8 You ring up, who would you ring up? I would ring up Mr. Stakelum or Mr. Sealy who was there at the time. 93 Q 9 Mr. Sealy and they'd tell you what had been entered in? 10 A 11 94 Q 12 How you stood, yes. Would you give them advice as to what to do with it or would you take their advice? 13 A 14 95 Q 15 A 16 96 Q 17 A 18 97 Q I just took their advice. Took their advice? Yes . Did they ever send you any written statement? Never anything, no. You got monthly statements, you would ring them up and ask them? 19 20 A 21 98 Q 22 Possibly monthly, yes. You never asked where the money was, you assumed it was in Jersey? 23 A 24 99 Q 25 26 You would just ring up and ask and they give you the I assumed it was in Jersey, yes. I want you to tell me how the matter terminated, how did this arrangement terminated in 1966? A 27 I decided that in 1966 that I sort of would finish up with Mr. Stakelum. 28 100 Q 29 A 1996? 1 101 Q 2 A 1996, I decided that I would finish up with 3 Mr. Stakelum from that point of view, from putting 4 away any more money and I asked him then to give me 5 back the monies that were there which he did. 6 102 Q 7 A 8 103 Q And whatever income they had earned? Yes . I do not want to go into your private affairs but am 9 I correct in saying that you had nothing to do with 10 any of the companies with which we are concerned or 11 refer to in our letter after 1996? 12 A 13 104 Q 14 Did you have anything do with any of the companies named in our letter after 1996? 15 A 16 105 Q 17 18 Sorry? No, no. I want you to tell us about your relationship with Guinness & Mahon, the bankers? A With Guinness & Mahon, the bankers. I was 19 introduced to Guinness & Mahon, the bankers by 20 Mr. Stakelum who arranged an original loan for me as 21 far as I can remember, it was a long time ago. 22 106 Q You met Mr. Stakelum in his office in 1983 and it 23 was some time after then that he introduced you, is 24 that it? 25 A 26 107 Q I would really have to think about the years. Do think about it, it is of some importance 27 Mr. Keane. 28 relationship with Guinness & Mahon? 29 A I am asking you when was your first 1 2 108 Q 3 Mr. Stakelum then? 4 A 5 109 Q 6 A 7 8 110 Q A 12 111 Q 13 You see you talk about on reflection, Mr. Keane, in (Exhibit 1)? Yes . In your statement you said it was 1983/1984, is that incorrect ? 14 A 15 112 Q 16 I would have to look up my diaries and honestly Doing the best you can, have you got diaries with it down? A 18 No, just my own little personal diaries would probably have that at home somewhere. 113 Q 20 Probably have one of nearly 20 years old would you, you have the 1983 diary? 21 A 22 114 Q 23 Possibly, possibly yes. When you made that statement in the unsworn statement A 25 26 I must have met Mr. Stakelum a bit earlier than that your statement 11 24 Sorry? the statement is what presumably you reflected on in 10 19 No, I must have met with Stakelum a bit earlier. now on reflection. 9 17 Then you were not introduced to Guinness & Mahon by (Exhibit 1)? You see I did not think -- I know the importance of it now but 1983. 115 Q You see you were able to identify the time you went 27 to and it was the time of the break up of your 28 partnership, was it not, and somebody in the golf 29 club suggested that you see Mr. Stakelum? 1 Yes, that's right. 2 was about 1983. 3 earlier than that. 4 116 Q 5 A 6 117 Q 8 A 9 118 Q 10 A 11 A year or so? Yes, it night have been a year or so earlier than Who did Mr. Stakelum introduce you to? In Guinness & Mahon, he just arranged it. Who did he introduce you to, who did you meet? I did not meet anybody. He just arranged the loan with Guinness & Mahon. 12 119 Q 13 A 14 I see? I did go into Guinness & Mahon on one occasion and sign, sign something or other. 120 Q 16 Did you not then have any dealings, personal dealings with Guinness & Mahon then? 17 A 18 121 Q No. You did not know any of the personnel in Guinness & Mahon? 19 20 It night have been a year or so that. 7 15 I would have still thought it A No. I met Mr. Traynor. I met him but on a social 21 thing but otherwise I did not know anybody in the 22 bank. 23 122 Q 24 It was all handled then through Mr. Stakelum, is that the position? 25 A 26 123 Q 27 Yes . The loan that you obtained, was that a loan to your company? 28 A 29 124 Q In Guinness & Mahon, yes. 1 2 125 Q 3 4 A 5 126 Q That would have been later then? 6 A It should have been a bit later. 7 That might have been to buy out my partner, Mr. Quinn. 8 127 Q 9 A 10 Did you not have a personal loan? I did have a personal loan, yes, I beg your pardon. That was to pay my wife, that is quite right. 11 128 Q 12 A 13 129 Q 14 When was that? That would have been in 1983. Do you remember the first loan you got? A 16 130 Q 17 A 18 I think it was about £40,000. Do you know what it was for? The first loan to my recollection was to pay some Sterling accounts in England. 131 Q I would just like you to look at a bank report of 20 February 1980 at page 28. 21 document from Guinness & Mahon, Mr. Keane 22 2 )? 23 MR. KILLEEN: 24 25 This is an internal (Exhibit We do not have this document. 132 Q MR. JUSTICE COSTELLO: 26 1980, I wonder if you have got the right document? 27 A 28 133 Q 29 Do you remember how much it was for? 15 19 Yes, I think I had a second loan. Yes . It is the banking report, February 1980, do you see that? Is that it, is that the document you have? 1 2 3 "In addition Sterling loans were granted to Gerry Keane Limited £50,000." 4 5 6 A 7 135 Q 8 A 9 136 Q 10 A 11 137 Q 12 13 £50,000, yes. That seems to be your loan? That was the start of the loan, yes. That is February 1980? Sorry, yes, I did not think it was that far back. Do you remember the security that was given for that loan? A Yes, I think on the first loan I got out from 14 Guinness & Mahon, I think Mr. Stakelum guaranteed 15 it. 16 138 Q 17 I am not a 1 0 0 % sure about that. Do you know the security, if any security was given for Mr. Stakelum's guarantee? 18 A 19 139 Q 20 A 21 140 Q I do not know. You do not know? No. The course of our investigations have indicated that 22 the loan which was granted to your company, and 23 which was granted to you personally was secured by a 24 deposit of what is now known as Ansbacher, did you 25 know about that? 26 I did not, no. 27 MR. KILLEEN: 28 29 Perhaps we could have a 1 2 MR. KILLEEN: If we could possibly have 3 one moment with our 4 client, it is just because our client cannot hear 5 us . 6 MR. JUSTICE COSTELLO: Sure. 7 8 SHORT ADJOURNMENT 9 10 141 Q. MR. JUSTICE COSTELLO: 11 I now want to come to page 22 or 23. I want you 12 to look at an exchange control document in relation 13 to Heytesbury Lane. 14 E4 up there on the left-hand side (Exhibit 3)? 15 A. 16 142 Q. You see Mr. Keane this is form Yes. It is a central bank form and do you see at the 17 bottom there is a signature G. Keane, is that your 18 signature? 19 A. 20 143 Q. Yes, it is, yes. Do you see there it is addressed to the National 21 Irish Bank, the name and address of the bank to 22 which the application is made and you are the 23 applicant. 24 A. 25 144 Q. 26 A. 27 145 Q. 28 29 Do you see that? Yes. The amount of currency is Stg£98,000 Sterling? Yes. The name and address of the payee is Beesley Properties Inc. Who were Beesley Properties Inc.? 1 2 146 Q. 3 A. 4 147 Q. 5 A. 6 148 Q. 7 8 A. 149 Q. 1988 I would say it would have been. What is your association with Beesley Properties I asked at the time, Mr. Stakelum, that I found this Can I just interrupt you? I just want to know what your association with Beesley Properties Inc., is? A. 13 I really had no association apart from signing the documents. 14 150 Q. 15 A. 16 What do you mean by having really no association? Mr. Stakelum arranged for the house to be bought by Beesley & company. 17 151 Q. 18 A. 19 152 Q. 20 A. 21 153 Q. 22 A. 23 In 1988? Yes, as far as I am aware 1988, yes. What money did he use to buy the property? I do not know what monies he used. But was it not being purchased on your behalf? It was being purchased on my behalf, yes. The money would be money that was away obviously. 24 154 Q. 25 A. 26 155 Q. 27 A. 28 156 Q. 29 When did they buy the house? house and I could not get a loan at the time. 11 12 That bought the house, yes. Limited? 9 10 Yes, originally? Money away? Yes. He used that money that you thought was in Jersey? Yes. To buy this house? 1 157 Q. 2 You see the name of the company, Beesley Properties Inc. ? 3 A. 4 158 Q. 5 A. 6 159 Q. 7 Yes . That was established, that was in Guernsey? Yes, I see that, yes. You knew then that the house that you were buying would have been owned by this Guernsey company? 8 A. 9 160 Q. 10 Yes . And the money was money that you had given him to look after? 11 A. 12 161 Q. 13 A. 14 162 Q. 15 A. 16 163 Q. 17 A. Yes . In fact, it was your house in name of this company? Yes . Do you see the date of this document? Yes . On the 28th of the 2nd 1990? Yes . 18 164 Q. Beesley Properties Inc., your company in Jersey INTERJECTION). 19 A. 20 165 Q. 21 22 23 Perhaps I misunderstood what you said, I thought you were agreeing with me that it was your company? A. 16 6 Q . 24 A. 25 167 Q. 26 A. 27 28 I cannot say it was my company in Jersey. It was the company used to buy the -- I do not know It was your money? Yes, yes. The company owned the property? I do not understand that, as far as I was just told that you use this company to 168 Q. To what? 1 169 Q 2 A 3 170 Q 4 A 5 171 Q 6 A 7 172 Q 8 A 9 173 Q 10 A 11 174 Q 12 A 13 175 Q 14 A Mr. Stakelum. 15 176 Q Mr. Stakelum? 16 A 17 177 Q Yes and then ultimately buy the house back off them. That is what I am coining to now? Yes, right. They bought the house? Yes . With money that you had in the Channel Islands? Wherever, yes. Then you bought the property from them? Yes . Why did you do that? That was the advice I was given? Who gave you that advice? Yes . Would you just look at page 24, a cheque. 18 cheque from a firm of solicitors, Killeen 19 solicitors. 20 is for £96,439.20 21 A 22 178 Q 23 This is a It is payable to Beesley Properties. It (Exhibit 4)? Yes . That is the purchase price of the house that you bought? 24 A 25 179 Q 26 A 27 180 Q Yes . Who were Killeen's, were they your solicitors? No, they were Beesley's solicitors. Beesley's solicitors, yes. Beesley's solicitors 28 made out a cheque payable from their client's 29 account to Beesley's Properties? 1 2 This cheque was to be, it was in Irish pounds and 3 you applied on behalf of Beesley's to transfer that 4 Irish pounds into Sterling, £98,000 Sterling, is 5 that right, that is on the form? 6 A 7 182 Q 8 A 9 You signed, you signed it? I signed the form obviously, yes, but all the dealings were done by Mr. Stakelum. 10 183 Q 11 A 12 Sorry? The dealings were all done by Mr. Stakelum, I would just sign. 13 184 Q 14 A 15 I did not apply. You just did what he advised you to do? Yes . MR. BUTLER: 16 Judge, I really do not wish to interrupt because 17 I realise that it is prone to a reaction from you in 18 certain terms but to be helpful, the date on the E4 19 predates the date of the cheque because the E4 is 20 the 28th February 1990. 21 MR. JUSTICE COSTELLO: Yes. 22 MR. BUTLER: The cheque is the 26th 23 March and I think the 24 question you were putting was to the effect that the 25 proceeds had something to do with the E4 which the 26 dating does not, in fact, support. 27 MR. JUSTICE COSTELLO: 28 29 We can discuss that but if you would just look, 1 second page of the form. 2 27th March? Application approved, the 3 4 186 Q. Just to come back to the question I was asking you. 5 This is an application in which you are the 6 applicant. 7 transfer the money which was paid to Beesley 8 Properties Inc., by the cheque into -- it was the 9 proceed -- you see the purpose of the payment, It is on behalf of the -- it is to 10 proceeds of sale there number 8 and it was to change 11 that money into Sterling. 12 Mr. Stakelum's recommendation? 13 A. 14 187 Q. Did you sign that on Yes. Would you just look at another document on page 21. 15 This is a letter from Mr. Traynor and it is signed 16 by his secretary, Ms. Williams, and it is to 17 Guinness & Mahon, you see that (Exhibit 5)? 18 A. 19 188 Q. 20 A. 21 189 Q. 22 Yes. It is dated the 27th 1990? Yes. It is: "Dear David, I enclose herewith cheque in the sum of IR£96,439.20 payable to Beesley Properties Inc., together with photostat of Form E4?" 23 24 25 A. 26 190 Q. 27 28 29 Yes. "Would you please arrange to credit the Sterling equivalent to Ansbacher Limited Account No. 13154 602 and advise Sterling figure in due course?" 1 2 191 Q 3 presumably? 4 A 5 192 Q 6 7 Yes . The purchase price which you paid for the house ended up in Ansbacher's account in Guinness & Mahon? A 8 9 No, this would have been arranged by Mr. Stakelum Evidently, yes. Not to my knowledge. I have no knowledge of that. 193 Q Whoever owned, whoever was entitled to the 10 beneficial ownership of the shares in 11 Beesley Properties now had money in Ansbacher 12 account in Guinness & Mahon? 13 A 14 194 Q 15 Apparently, yes. Apparently so. Did you know that you had money there? 16 A 17 195 Q 18 No. Did you ever seek to draw out any money from the Ansbacher account? 19 A 20 196 Q 21 No. After this time 1990, did you ask Mr. Stakelum for any sums, any payment out, after 1990? 22 A 23 197 Q 24 A 25 198 Q 26 A 27 199 Q After 1990, yes, in 1994. Yes ? I transferred some money out of the account. How much was that? It was £100,000. You asked him for that sum. He would have arranged 28 it, you do not know how he got it, is that the 29 position? 1 2 I want you to put another document to you, it is 3 page 27. 4 bank. 5 Cayman Trust/College, do you see that 6 A 7 201 Q This is an internal document from the If you see the top of it Guinness & Mahon (Exhibit 6 )? Yes . If I could just pause there. That is a reference to 8 a firm called College Trustees in Guernsey. 9 ever hear of College Trustees? 10 A 11 202 Q Did you No. If you just look at then to the left Guinness & 12 Mahon Cayman Trust/College, c/o, then it gives the 13 Guinness Mahon Trust address and then it is a sundry 14 sub company account and do you see the 10th 15 1988, lodged re: Beesley and there is a sum of 16 £1,483.28. Do you remember making any lodgement or 17 giving any money at that time in June of 1988, that 18 particular figure, to Mr. Stakelum for any reason? 19 A 20 203 Q 21 A 22 204 Q June No. You do not? No. You tell us in your statement that you asked 23 Mr. Stakelum to furnish me any books or records 24 pertaining to funds held my him. 25 him that? 26 A 27 205 Q 28 A 29 206 Q When did you ask When I got the letter, the note from The letter from us? Yes, yes. I just asked him and...(INTERJECTION). 1 2 3 207 Q 4 A What did you say to him? He had gone out of business at that stage, he had 5 left his office and all that sort of thing at that 6 stage. 7 208 Q 8 A 9 He had left? Yes, he closed his offices I think in 1998 and when I rang him he said that he had no files. I have 10 written to him since or at least we have written to 11 him since and have had no reply so far. 12 209 Q 13 You say you are awaiting his reply but it looks as if he cannot help in any way? 14 A 15 210 Q It does look that way, yes. Do you know was there anybody else carrying on his 16 particular business, that firm or did it close with 17 him? 18 A 19 211 Q 20 A 21 212 Q 22 A 23 213 Q 24 A 25 214 Q 26 A 27 I think it closed with him. With him? Yes, the office. Business Enterprises Limited? Yes, yes he still operates on his own. Does he? Yes . Where does he operate? Out in Kilpeddar. He still works for me as an advisor. 28 215 Q 29 A He works for you? Yes, I still pay him a retainer to handle the bank 29 1 2 He acted as your advisor from the time you indicated 3 to us, 1983 or perhaps earlier and during that 4 period you also had your own accountant looking 5 after you? 6 A 7 217 Q 8 Yes . Your own personal affairs, I suppose, and your company's affairs? 9 A 10 218 Q 11 Yes, yes. You did not inform your accountant of the monies that you were giving to Mr. Stakelum? 12 A 13 219 Q No, no. Mr. Keane, we will break there for a cup of coffee 14 or a cup of tea if you would like now for about ten 15 minutes ? 16 A 17 220 Q 18 Right. And we will not have very many more questions to ask you. 19 20 SHORT ADJOURNMENT 21 22 MR. JUSTICE COSTELLO: 23 Mr. Keane, I have no further questions to ask 24 you but my colleague may want to ask you a few 25 questions. 26 27 28 29 1 2 3 MS. MACKEY: Mr. Keane, I just want to 4 clarify a few things that 5 I did not fully follow in the course of your 6 evidence. 7 purchased your house back from Beesley? 8 A 9 222 Q 10 Getting back to the transaction where you Yes . We were looking at a cheque, I think you may still have a copy of it (Exhibit 4)? 11 A 12 223 Q 13 Yes, Killeen. Drawn, yes, on the client's account, Killeen solicitors ? 14 A 15 224 Q 16 A 17 225 Q 18 Yes . You have that there? Yes, yes. What I wanted to ask you about that was, Killeen you told us were solicitors for Beesley? 19 A 20 226 Q 21 Yes . This is a cheque drawn by them on their client account? 22 A 23 227 Q Yes . Which they were paying to Beesley. 24 reimburse Killeen solicitors? 25 house, is that not right? 26 A 27 228 Q 28 29 Did you then You were buying this Yes . Where did the monies come from for the purchase of the house? A Sorry, we borrowed that money. 31 That money was 1 borrowed from AIF. 2 two loans running with Guinness & Mahon which was 3 very expensive and Mr. Stakelum arranged to clear 4 them off by borrowing from AIF, a separate account 5 and that was paid off. 6 year or so after that, we asked AIF for a following 7 £90,000 to buy this house and those borrowings were 8 paid off. 9 229 Q 10 At one stage I think there were Then after I think it was a Can I just get clear now, if I could summarise what happened with this house? 11 A 12 230 Q 13 A 14 231 Q 15 A 16 232 Q 17 Right. In 1988 Beesley Properties purchased the house? Yes . From some third party? Yes . With monies that belonged to you that were, as you thought, in Guernsey, 18 A 19 233 Q 20 A 21 234 Q 22 is that right? I would so, yes. That was the first thing? Yes . Then the situation was the house was owned by in the name anyway of Beesley Properties? 23 A 24 235 Q 25 A 26 236 Q 27 A 28 237 Q 29 A That's right. But purchased with your money? Yes . You then borrowed money from AIF? Yes . To purchase the house from Beesley? 1 238 Q 2 A 3 4 It would have been to Beesley, honestly I do not know. 239 Q Beesley had already got money drawn by their own 5 solicitors. 6 that he saw went into the Ansbacher account? 7 A 8 240 Q 9 The cheque that Beesley got, the one Yes . Was a cheque signed by their own solicitors drawn an their client account. 10 Were you a client of Killeen solicitors ? 11 A 12 241 Q 13 A 14 242 Q 15 No. No, so it was not drawn on your account? No. That is clear now. You say you took out a loan from AIF to finance this? 16 A 17 243 Q Yes . The loan that was taken out from AIF, there was a 18 draft or a cheque or something in 19 this...(INTERJECTION)? 20 A 21 As I understand it is this, that must have been given to Killeen. 22 244 Q 23 A It was given to Killeen? That is the only way I can understand it because 24 they have written this so that draft must have gone 25 to Killeen. 26 245 Q 27 Since the money that Beesley used to purchase the house in the beginning was your money? 28 A 29 246 Q It thought -- that is where it came from. 1 2 247 Q. 3 A. 4 248 Q. 5 A. 6 When Beesley first bought the house? Yes. They used your money that was off-shore? Yes, it would have been money that I would have given to Mr. Stakelum. 7 249 Q. 8 A. 9 250 Q. 10 Yes so it was your money? Yes, probably, yes. In paying them the same sum again were you not at a loss? 11 A. 12 251 Q. 13 A. 14 No, I do not think so. Can you explain? I might sound very vague but I really do not know. It was all handled by other people. 15 252 Q. You cannot throw any further light on this? 16 A. I really could not, no, I really could not. 17 253 Q. That leads me to another point, Mr. Stakelum, as you 18 have explained there in your statement and again to 19 us this morning; has not furnished you with any 20 information? 21 A. 22 254 Q. No. Records or anything like that and you think that he 23 probably has not got any or will not be able to 24 help? 25 A. 26 255 Q. 27 A. 28 256 Q. 29 He told me that they were destroyed. He told you they were destroyed? Yes. You just told us there before the break that he is 1 2 257 Q. Have you asked him specifically to clarify for you 3 where he put your money on deposit because 4 presumably he would remember that? 5 A. He said to me that -- I said to him, I said Jack, 6 this Ansbacher I had never heard of it until it came 7 in on the letter and he said there is a possibility 8 that it was there for some time. 9 understood -- thought it was in Jersey, it has been 10 -- 11 been monies transferred. 12 258 Q. He said, I always the transfer -- not just yours but there has Was this what he told you, I see. Did he tell you, 13 in fact, that he originally had put your money in 14 Jersey? 15 A. 16 259 Q. He told me it was away. No but now, when you went now to get the whole 17 position clarified with him and you said to him, you 18 had never heard of Ansbacher; did he say to you, 19 look, where I actually put your money was? 20 A. 21 260 Q. 22 A. No, he did not say. Did you ask him where did he actually put it? I asked him, I said to him I understood that all the 23 money was in Jersey, that I had never heard of the 24 Cayman Islands. 25 261 Q. 26 A. 27 262 Q. 28 A. 29 263 Q. Did he say that was right? And he said, well it was like at times. He said it was? At times it would have been in Jersey. He did say that it was in Jersey? 1 2 264 Q 3 A 4 5 Then he said to you that? He just said, I had said, could the money have been in the Cayman Islands and he said, yes. 265 Q You said something a minute ago that he said some of 6 it was transferred from time to time or what was 7 that? 8 A 9 i s ...(INTERJECTION). 10 266 Q 11 A 12 13 I do not know exactly what the words were but that If you could try to remember? The impression that I got was, it was shifted around a bit. 267 Q It was shifted around, thank you and just one other 14 matter, you mentioned when you were talking about 15 your first meeting with Mr. Stakelum and when you 16 retained him to act on your behalf, you mentioned a 17 Mr. Sealy, is he an associate of Mr. Stakelum? 18 A 19 time . 20 268 Q 21 A 22 Is he still working...(INTERJECTION)? No, he is long gone. He is long gone. He is 10/15 years gone I would say. 23 269 Q 24 A 25 270 Q 26 A 27 271 Q And he is still living is he? I would say he is still living, yes. Do you know where he is? I have no idea. You have no idea. I have no other questions, thanks very much Mr. Keane? 28 29 Joe Sealy was a partner of Mr. Stakelums at that A 1 2 3 FURTHER EXAMINATION OF MR. KEANE BY 4 MR. JUSTICE COSTELLO: 5 6 MR. JUSTICE COSTELLO: 7 Just one final matter, Mr. Keane, which I think 8 is clear from what you have been telling us but just 9 so there can be no doubt about it. Did Mr. Stakelum 10 at any time tell you that he had established on your 11 behalf a trust? 12 A 13 273 Q No. Just again I think it is clear from your evidence, 14 but you gave the money to Mr. Stakelum and 15 Mr. Stakelum put it, you thought, in Jersey and am I 16 correct in saying that it was not any interest or 17 any profit was not returned for tax by you? 18 A 19 274 Q No. Thank you Mr. Keane. We will require you to come in 20 to sign the transcript when it is available next 21 week probably? 22 Right okay. 23 24 END OF EXAMINATION OF MR. KEANE BY MR. JUSTICE 25 COSTELLO 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED i. Air E564 rm 7 xdrr/(rxz ,0 We 00 r _______________________ UNSWORN STATEMENT OF MR. GERARD KEANE I refer to your letter of 1st March, 2000. . . • ' . ,-4 Firstly, I should mention that the matters raised in your letter are unknown to me in general terms with the exception of my knowledge of these matters from media reports. I have no books or records pertaining to the matters raised in your letter of 1st March, 2000. I can only speculate that monies invested by Mr. Jack Stakelum, Financial Advisor, might have been deposited in Ansbacher (Cayman) Limited for a period unknown to me. I have asked Mr. Jack Stakelum to furnish to me any books or records pertaining to funds held with him for the purposes of investment from approximately 1983/4 until 1996 and I am awaiting his reply. At no stage was I aware of the precise location of funds invested with Mr. Jack Stakelum and/or his company, Business Enterprises Limited, as the investments were handled exclusively by Mr. Stakelum and/or Business Enterprises Limited. In approximately 19881wished to purchase a house. At that time I was unable to obtain a loan and I asked Mr. Stakelum to make funds available to me in this regard. It may be the case that the funds that were made available to me were secured by funds lodged in a deposit account, the location of which I do not know. I note in your letter to me of 1st March, 1992, at paragraph 6 of Appendix C thereof, you refer to the Exchange Control Acts (1954-1992). I do not know whether any application was made on my behalf under the Exchange Control Acts (1954 -1992). day of May, 2000 BANKING REPORT FEBRUARY 1980 HOBBY MARKET: LOANS & OVERDRAFTS* flftHBiliflfl.'jfWM ijfWBii BWlrtBi to q « rry Kw m i m a l f f l £30,000; : FORM E.4 EXCHANGE CONTROL ACTS 'MISCELLANEOUS PAYMENTS 646186 AppOudn>to make.a payment lo !a nonresident of the State* other than iMgoods, c a sh glttafirfreinidnal loans. .s ,.... ' ■ • .• 7 *■■£'■■■’ ?" ’■* ’ For official use only Country ’ ALL APPLICANTS SECTION A-^+tffe'C Currency Nam* and address. of;bank, to: " " liATiCj^AL..]3;Si$K,BANK, .. .. which application js'maisie . '■ ...., < ....;...... Amount A*Vf« t Na lie OT^sdcfiisa o?:appflQ^nF~ -.15ftK ?. Kf? P.ftP.P.. E X C H / » '« J l. . I 54 H.ytesbury' Latie ‘ ’ .....I Dublin 4 2. ... ~ 2 M A R 1990 F ile 3. Category ___ ^ .h ito c j r,...... * 4 w ^ w i ! <=“'™n°y proposed payment ' J Thouaand....... pounds S t a r l i n g . . Amount in words 5. ‘ 6. 7. 8. Source IriaB pound equivalent! ) ' I . ' ' ' . ' . • : ' *' • •* .•••.< i ■ ? t Name/and; address ofj P la t e a u Mignot, S t . P ete r P o r t , paves Gua unsay.,..channel.. Island*...... ' ' [ ?' Source oT fun' MAR1990 EXCHANGE C O N T R O l . 1. Permissions granted must be availed of within three months unleaa otherwise specified. '■ . 2. Where the amount transferred is not full/ utilised for the purpose* stated, the applicant must arrange (or the balance to be repatriated and, if in a currency other than Irish pound*, sold to an At the:toed Dealer at tha current rate of exchange. ' BANKS SHOULD REMIT COMPLETED FORMS TO THEIR HEAD OFFICE FOR LODGEMENT WITH THE CENTRAL BANK OF IRELAND AS SOON AS THE TRANSFER HAS BEEN COMPLETED. CentreI Bank at (ra'and. Exchange Control. P.O. Box 859, Dame Street, Dublin 2. Telephone— 01 -716666. Telex—31041. KILLEEN 95-15-05 mans 67A mourmov SQUARE. - mom ran onus zrtu'i j. - it; Tobin: 3m hm 3% 3.30. H, m4 mun:me? Wm?- 26 g?bga?lujg?; 2-5 {an cum?Acoouur . mm - ?is-1505!: ?HiOhLUof s r ^ . ' • ) Dear D a v i d , ' I enclose herewith cheque in th* sun of IR£96,439.20 payable to Beesley Properties Inc., together with photostat copy of Form B.4. . Would you please arrange to credit the Sterling equivalent to Ansbacher Limited Account Mo.13154602 and advise Sterling figure in due course. Yours sincerely, s.. JDT/AJW ■ f I . . . . It I f W ' T Jtrmn n mmntn M B H M H M IA m eo a a m a n xw u n uuxw b whd ORVBO 'i n m a x m a iv» / im i m u u « m m n s / m u in n o m bm n a n nj^< % C . # C m o * mmno aora* ram tino o/a wa— ina u me n 23 147 24 Q. When did that start? A. I -am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service r i A. If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I era aware of were already abroad. 4 >«• 5 I would have asked Mr. Traynor to advise me where the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 Could you not be a little bit more specific because Q. 10 . you know these terms, I don't know. 11 explaining them to us? 12 Would you mind If the client wished to place the funds with me and A. 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 16 17 151 18 152 21 22 This is client's of yours? A. Yes. Q- Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in ... 19 20 Q. 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 the sense of what interest rate...(INTERJECTION). They were asking me whether I could monitor those funds on their behalf. 154 Q. ' Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say 'We have funds offshore' wherever 1 they might have been 'Can you look after these funds 2 for me.' 3 155 Q. 4 What did that mean? 5 A. 6 7 "Can you look after these funds." Would you endeavour to get^xhe best interest rate. Would you monitor the funds. ‘ 156 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial Q. 10 institution? 11 A. I don't think they would come in and say 'We have 12 funds. Will you change them for some other 13 financial institution.' I think a discussion would .14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.1 17 157 18 Q. What does that mean? . A. It. means that they might not want to correspond 19 directly with whatever -foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 Q. a And that What did you do then? . I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 in this connection? 5 A. It means I would probably have contacted 6 Des Traynor. 7 — 8 were — 9 by me.' 10 What does that mean 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients that wishes to have funds monitored abroad Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A. You have a client. Des Traynor is to give me an account number, a 14 reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — might be 18 19 162 Q. Those funds — moved to a receiving bank.k This is very important. If you don't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 33 ! 1 164 Q. 2 What was the account, in whose name was the account to be placed? 3 A. ’ I have a difficulty answering that question, not 4 wanting to be uncooperative. ' All I am saying is 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. 8 You must have known the financial institution in which your clients's funds were going to be placed? 9 A. The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. 13 Tell me some of them that were used that Mr. Traynor would have told you about. .14 Give me the names of some of those, Mr. Stakelum? 15 A. It is very difficult unde? oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 so etc. etc.. 20 that. 21 If 22 167 Q. 23 ,it I don't know. But I am not absolutely positive of It could also vary depending on the currency. was dollars it might be something else. What other financial institution did he tell you that the money was going to be deposited in? 24 A. I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 168 Q. 29 ' I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other 34 ! o 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. I just cannot answer that. That is not wanting to • . '■:•--& be uncooperative, I just cannot remember. Q. Why can't you remember? A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 5 6 169 7 8 170 9 ‘ the Guinness & Mahon subsidiaries in Cayman or in 10 the Channel Islands? 11 A. I don't think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. I am not too sure. It may have been the account of Guinness & Mahon in 18 Dublin or Guinness & Mahon in London. 19 offshore bank we are talking about, Guinness & Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 24 172 25 26 173 Was this the They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? r> i A. I cannot remember. I suspect that some of the 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 'w* 5 what their internal ...(INTERJECTION). 174 Q. A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A. 11 12 They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 175 13 14 Didn't you say that to me a few 176 Q. They were offshore already you think? A. Yes, most of the funds were offshore already. Q. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 18 177 19 Did you ever have clients coming in A. Yes. Q. What would happen then? A. At different stage's, "inthe early stages I think 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 24 25 26 179 It is one and the same in the Then-they could be moved from Sterling. Q. Were they put offshore, the funds? A. Yes. Q. Where? A. All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey. But it could well have been oc. » r 1 180 2 3 181 Q. One or the other? A. Yes, I assume one or the other. Q. Did any of your clients to your knowledge establish 4 trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in theT%ayman Islands or in the 6 Channel Islands? 7 8 182 9 10 183 A. Not to my knowledge. Q. None of them told you that they had done this? A. No. Q. Mr. Traynor didn't tell you that he was going to 11 suggest this to them? 12 13 ’ 184 A. No. Q. You are pretty certain on that or are you doubtful 14 about it? 15 A. I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q. 20 22 If they didn't establish trusts, you are aware of 186 A. Yes, that's right. Q. We will break now for a cup of coffee, Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 ' clients.who"transferred funds offshore? 19 21 I am not aware of any SHORT ADJOORNMKNT Our Ref: CZS1Q/NM iJ h 'M i. 18* October 2000 Mr. Jack Stakelum. “Fairmonf’ BaUyronan Road Kilpcdder Co. Wicklow S trictly Private A Co>I My operating procedure for this service bad but four components: • • • • A deposit account in G&M that I have described as a hotchpotch account. A manual memorandum record I kept in my office under my personal control A float account in AEB. A monthly reconciliation o f the sum o f the memorandum records with the sum o f the account(s) in G&M and any float balances. In the interest o f completeness perhaps I should add also: • • • • G&M would be aware o f the total fbnds I had in my hotchpotch account G&M would not be aware o f the names o f the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could surface as part o f another business transaction with the bank, e.g. a back-to-back loan. Some o f my clients would be aware generally that the funds they held offshore were in a G&M vehicle. Other clients would be aware that their funds were ofl&hore but would have no awareness or care about the name o f the bank in which their money was deposited Only I knew the names in the memorandum account and only I knew the ownership o f the balance in the float account kept in AEB. ' 5. The information requested by Ms. Mackey on the 6 December 2000. The information requested by Ms. Mackey on 6 December'2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list o f names I sent to the Inspectors on 6 November 2000. schedule had offshore deposits in G&M through my procedure. Yours sincerely, All on this GenyKetne. ■ r * ' Offshore Deposits Back to Back loon. Date Deposit Opened Date Deposit nnorri Source o f Funds Offshore Source of Funds Irish Pounds. Yes. Yss. Late 1970#. a 1990. PartM y. PwtWly. Extract from a statement dated 22 September 2000 provided to the Inspectors by Mr. Jack Stakelum Turning now to the data requested in Appendix C enclosed with your letter of 30 August 2000. I propose treating the information requested in the separately number paragraphs as questions to which I now respond seriatim as follows: (7) Channel Island Trusts and Companies. I am aware of this service through experience of one transaction only. I have no documentation but my recollection goes as follows. Mr. Geny Keane, a Client...... probably in 1988 wished to purchase a residence in Ireland using funds he held offshore. Having sought advice from Mr. Traynor I advised Mr. Keane that the only manner in which he could maintain the confidentiality of his funds was by using an offshore company. Guinness and Mahon provided this service; a property was acquired and initially rented to Mr. Keane. Subsequently, Mr. Keane purchased Ihe subject property himself. ’ r ' & A C M P T m te r - r 5 * - S T fid & L U H (7)CtaMlblMi T M aid OMipniM. 7b s ^ S s ^ * 000 & A J & 0 & C Z b tS Subeequeiitiy.Mr.Keeiepureiwedthesiiyedprope^yMBW^ lsv»Qcdof«hk»«rrfc»tanoodiBfinv«^«cc* a^ » few^ * wwfl,,iq,*,do“ contained in (a) throuahm la fth m & m do «•»■»•"'•"■» Appendix XV (160) Mr Austin C Murray 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Austin C Murray. a) b) Transcript of evidence of Mr Austin C Murray dated 30 January 2001. Extract of transcript of evidence of Mr Jack Stakelum dated 8 November 2000. 2. c) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. d) Letter of 6 November 2000 and enclosure from Mr Stakelum to Inspectors. e) Letter of 21 February 2001 and enclosures from Mr Stakelum to Inspectors. Correspondence received from or on behalf of Mr Austin C Murray, a) Letter of 21 November 2001 - Austin C Murray to Inspectors. UNDER OATH ON TUESDAY, 30TH J A N U A R Y 2001 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The Inspectors: MS. N. MACKEY BL MR. M. CUSH SC Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. AUSTIN C. MURRAY WITNESS MR. A. MURRAY I EXAMINATION MS. MACKEY PAGE 25 1 2 3 4 5 MS. MACKEY: 6 Mr. Murray, we have already introduced 7 ourselves but just formally now my name is 8 Noreen Mackey and this is Michael Cush. 9 two of the four Inspectors appointed to investigate We are 10 the affairs of Ansbacher. 11 are not dealing with your particular case. The other two Inspectors 12 13 This is not, as you know, a Court or a Tribunal. 14 It is just an interview. 15 MR. MURRAY: Yes. 16 MS. MACKEY: Although it is an 17 interview under oath. 18 MR. MURRAY: Yes. 19 MS. MACKEY: If for any reason during 20 the course of the 21 interview you feel concerned about a question that 22 you have been asked and would prefer not to answer 23 unless you get legal advice you can tell us that 24 and we will adjourn to a later date to enable you 25 to do that since you have not got a lawyer with 26 you today. 27 MR. MURRAY: 28 29 Yes. 1 2 M R . MURRAY: 3 I don't have a lawyer with me because I don't think I 4 need one. 5 MS. MACKEY: That is grand. 6 M R . MURRAY: But I was informed that 7 when somebody had brought 8 along a lawyer that they didn't even listen to him. 9 MS. MACKEY: 10 I see. Any way, Mr. Murray, I will now 11 ask Ms. Cummins, our soli citor here, to administer 12 the oath to you. 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 5 1 Q. MS. MACKEY: Mr. Murray, I do not think this will take 6 7 very long because you sent us in a helpful 8 statement, Exhibit 1. 9 your own statement with you? 10 A. 11 2 Q. 12 A. 13 3 Q. Do you have a copy of I do, yes. Because I will refer to that if you do not mind? Yes. Just for the record first of all can I just have 14 a little bit of background about yourself and your 15 own professional career? 16 architect; is that correct? 17 A. 18 4 Q. 19 A. 20 5 Q. 21 A. 22 6 Q. 23 I am, yes. And are you still practising or retired? I am more or less retired. You are retired? Yes. Did you work as an architect for all your professional life? 24 A. 25 7 Q. 26 Yes. Were you involved in business as well apart from your architectural practice? 27 A. 28 8 Q. 29 I understand you are an You mean did I have a company or anything like that? Yes? 1 2 3 10 Q. 4 That was all. Did you operate that through a company? 5 A. 6 11 Q. 7 Well, I was just a Director of the company. I understand you had a company called Arthur C. Murray; is that correct? 8 A. 9 12 Q. 10 A. 11 13 Q. 12 No. It is not correct? No. I say that because you provided us kindly yesterday with some files that you got from Guinness & Mahon? 13 A. 14 14 Q. Yes. And from that it emerged that you had at one 15 stage a loan with Guinness & Mahon in the name 16 of Arthur C. Murray Limited, 17 Clyde Road, 17 and it appears that that is a company with its 18 registered office at 17 Clyde Road; is that correct? 19 A. 20 15 Q. 21 22 Never heard of it. I see. May be we can leave that aside...(INTERJECTION)? A. Unless somebody is mistaken and put my name 23 down as Arthur instead of Austin but I 24 never -- I have been called lots of things. 25 16 Q. 26 Did I say "Arthur C. Murray"? 27 A. 28 17 Q. 29 Sorry, instead of what? Yes. I beg your pardon. I should have said 1 2 18 Q. 3 Yes. The name of the company that we saw is Austin C. Murray Limited? 4 A. 5 19 Q. 6 A. 7 2 0 Q. 8 A. 9 21 Q. 10 A. 11 22 Q. 12 Yes. 17 Clyde Road? Yes. That was a company? That would be the architectural practice. That was your practice? Yes. I see. That is fine. Sorry, it was my mistake. If we could look at your statement, Exhibit 1? 13 A. 14 23 Q. 15 A. 16 24 Q. 17 A. 18 25 Q. If I can find it now. We will give you another copy? Yes, if have another copy that would be useful. Yes (Same Handed), Exhibit 1? Thank you. If we could move down the statement to the 19 fourth paragraph there and to where you talk 20 about the funds that you received in 1974; 21 do you see? 22 A. 23 26 Q. Yes. I would like to you ask about your first contact 24 with Guinness & Mahon in Dublin? 25 come about? 26 A. 27 27 Q. 28 29 How did that I think it was through Haughey Boland. Yes. Someone in Haughey Boland introduced you to Guinness & Mahon; is that it? 1 2 3 2 9 Q. 4 A. 5 30 Q. 6 A. 7 31 Q. 8 9 It's 30 years ago. I can't remember. You cannot remember? No. Was your first contact with them in 1974 when you deposited these funds with them? A. 10 11 Can you remember? When -- really what I am saying here is that I put money into...(INTERJECTION). 32 Q. No, I understand what you are saying there 12 (indicating). 13 Had you had contact with Guinness & Mahon prior 14 to that? 15 A. However, what I want to know is: Were you banking with them? It is difficult to remember but in fact it has 16 just suddenly struck me that Guinness & Mahon 17 were a client of mine at one stage and that is 18 probably how I came to them. 19 33 Q. 20 A. 21 34 Q. Prior to 1974? Yes. I see. Anyway moving on to the deposit that you 22 made, as you say here, with Guinness & Mahon in 23 1974. 24 to make this deposit? 25 A. 26 35 Q. 27 A. 28 36 Q. 29 Who did you approach in Guinness & Mahon I couldn't tell you. Was it Mr. Traynor? No. Did you know Mr. Traynor? 1 37 Q. 2 3 You did not approach Mr. Traynor to make this deposit? A. 4 No, I think in fact what happened is that I -­ well, I had money. 5 38 Q. 6 A. 7 39 Q. 8 A. 9 Yes? I had fees coming in. Yes? And they were clients of mine and I put the money into -- on an ordinary account basis. 10 40 Q. 11 A. Into Guinness & Mahon. 12 41 Q. Into Guinness & Mahon? 13 A. 14 42 Q. 15 Yes? Yes. You say here that you did not declare the income to the Revenue authorities? 16 A. 17 43 Q. 18 A. 19 This other thing because...(INTERJECTION). Is that a different account? Some of that money eventually may have gone into an off sea account. 20 44 Q. 21 A. 22 45 Q. 23 A. 24 4 6 Q. 25 A. 26 47 Q. 27 A. 28 48 Q. 29 A. This is what I am trying to get at? Yes, I know. How would that have happened? Really I can't remember how. You cannot remember at all? No. May be we could assist you a little bit? Yes. You are acquainted with Mr. Stakelum I believe? I am, yes. 1 4 9 Q. Right. Did Mr. Stakelum have any management of 2 your overseas funds or assist you in any way in 3 the management of them? 4 A. Mr. Stakelum was involved but I am trying to 5 remember to what extent. 6 office. 7 Clyde Road. 8 50 Q. 9 A. 10 51 Q. 11 A. 12 13 He was in the same He rented his office from me in He rented. You were his Landlord? Yes. I see. Yes? And I met him through Haughey Boland; as being my accountants. 52 Q. 14 This would have been after he had left Haughey Boland himself; was it? 15 A. 16 53 Q. 17 A. 18 54 Q. 19 A. 20 55 Q. 21 A. 22 56 Q. 23 A. 24 57 Q. 25 No, when he was still there. He was still there? Yes. So, was he acting as your accountant in fact? Well, Haughey Bolands were acting as my accountants. However ... (INTERJECTION)? Not Jack Stakelum personally. Not him personally? No. Who in Haughey Boland was acting for you? Mr. Traynor? 26 A. 27 58 Q. 28 A. 29 5 9 Q. No, no. No, no. You are putting words in my mouth. I am only trying t o ...(INTERJECTION)? Assist me. Help your memory? 1 A. 2 3 I can't remember the names of the people who were dealing with my accounts. 60 Q. 4 In any event it was not either Mr. Traynor or Mr. Stakelum? 5 A. 6 61 Q. However, you knew both of them through that? 7 A. Again, Haughey Bolands were clients of mine. 8 62 Q. 9 A. 10 63 Q. 11 A. 12 64 Q. 13 Yes? At one stage. Yes? I designed their offices in Amiens Street. However, they were also your accountants; you have explained? 14 A. 15 65 Q. 16 A. 17 66 Q. 18 A. 19 20 No, it wasn't. Yes. That is really the relationship? But I would have known Des and Jack as clients. As your clients? Yes, but it is through the client relationship that I really knew them. 67 Q. I understand. In any event what I am interested 21 in at the moment is your relationship with 22 Jack Stakelum insofar as it impinges on 23 the overseas accounts? 24 A. 25 68 Q. 26 A. 27 69 Q. I hope there is no suggestion of...(INTERJECTION). Pardon? I beg your pardon? Sorry, I am being facetious. Yes. May be we could just move on, you know? 28 It would help us all if we can get to the end 29 of this quickly? 1 2 7 0 Q. Did you approach Mr. Stakelum and ask him if 3 he could assist you in the management of the 4 overseas accounts or in placing them overseas? 5 A. I don't know how to put it but I can't answer 6 that question because I don't remember but it 7 was with Mr. Stakelum eventually that the 8 monies that I had put into the Ireland -- not 9 the Ireland one -- into the North of Ireland. 10 71 Q. 11 A. 12 The North of Ireland? Yes, yes. I had some money which I put into Kircubbin; The Ulster Bank. 13 72 Q. 14 A. 15 73 Q. 16 A. 17 7 4 Q. 18 A. 19 75 Q. 20 A. 21 76 Q. 22 A. 23 77 Q. 24 A. 25 78 Q. 26 A. Into where? Kircubbin; K-i-r-c-u-b-b-i-n. Right. What was that? It is in -- no, sorry. What was Kircubbin? Kircubbin was a bank; The Ulster Bank. I see? It's a place north of -- on Strangford Lough. Yes. Was this through Mr. Stakelum? No. Is that what you are telling me? No. Can you tell me what way Mr. Stakelum assisted you? Well, it -- I think I realised that that money, 27 instead of being in Kircubbin, could be put 28 somewhere else. 29 79 Q. Yes? 1 2 80 Q. 3 A. 4 81 Q. 5 A. 6 82 Q. 7 A. 8 Yes? That he -- no, I remember now. It does not matter who approached who first? No. However, what did he say to you? I haven't a clue. The money in fact went from Kircubbin to Guernsey. 9 83 Q. 10 A. 11 84 Q. Yes? And that was done through Guinness & Mahon. Right. Can you tell me how this was done 12 through Guinness & Mahon? 13 money from Kircubbin to Guernsey? 14 A. 15 85 Q. 16 A. 17 86 Q. 18 A. 19 87 Q. 20 A. 21 I don't know. Who moved the I haven't a clue. This was your money, Mr. Murray? This was my money, yes. Did you give instructions to the bank in Kircubbin? I presume I did. And what instructions did you give them? I just -- we are talking about 1974; around those dates. 22 88 Q. 23 A. 24 89 Q. Are we still talking about 1974? I couldn't tell you. It's, you know Let us see if we can tease it out? Did 25 Mr. Stakelum give you the number of an account 26 that you could...(INTERJECTION)? 27 A. 28 90 Q. 29 No. He did not? 1 91 Q 2 A 3 92 Q 4 A 5 Yes . What did he do? I don't know what to say because I am totally at sea on the dates and the amounts and the method. 6 93 Q 7 A Mr. Murray....(INTERJECTION)? All I can tell you is that the money went to -­ 8 I put -- I had money in Guinness & Mahon and they 9 put it on deposit in Jersey in my name. 10 94 Q 11 A 12 95 Q 13 In your name? In my name. And was that with College Trustees in Jersey or Guernsey? 14 A 15 96 Q 16 A 17 97 Q 18 I think it was. Yes. The name is familiar. Did you get statements from them after that? No, no. What did you do when you wanted to know the state of affairs of your fund? 19 A 20 98 Q I would ask Guinness & Mahon and they would tell me. Who would you ask in Guinness & Mahon? Is it 21 not the case, Mr. Murray, that you dealt with 22 Mr. Stakelum in relation to these funds? 23 A 24 99 Q Not at that stage? 25 A Not at that stage. 26 100 Q 27 Not at that stage; later. Was it later? At what stage then did you begin to deal with Mr. Stakelum in relation to the funds? 28 A 29 101 Q I couldn't tell you. All right. It does not matter what date. 15 Can you 1 tell me why you began to deal with Mr. Stakelum or 2 how that came about? 3 point, you say, with somebody in Guinness & Mahon 4 in Dublin? 5 A. 6 102 Q. 7 Yes. And then there came a point where Mr. Stalelum took over? 8 A. 9 103 Q. 10 11 You were dealing up to this Yes. What did he do for you after that or how did that come about? A. 12 Well, he wanted the money to be put into collective funds that he had. 13 104 Q. 14 A. 15 105 Q. 16 A. 17 106 Q. 18 A. 19 107 Q. 20 A. I see? And I didn't want to do that. Yes? Because I wanted total accessibility. Yes? On my own. Yes? And at some stage he convinced me that the money 21 in one account would be -- would save sort of 22 bank fees and other corporate charges. 23 108 Q. 24 money to sort of a pooled account that he had? 25 A. 26 109 Q. 27 A. Yes. That that would save you bank charges? Yes. By the way there is something which, again referring to your stuff? 28 29 He convinced you that if you transferred your 110 Q. Yes? 1 A. 2 3 To my knowledge at no time did I have monies in the Cayman Islands. 111 Q. 4 Yes. I think that is quite possible, Mr. Murray, because to just explain to you what happened? 5 A. 6 112 Q. 7 Yes. Many of the people that we have met did not know this either? 8 A. 9 113 Q. Yes. People who had money with Guinness & Mahon's 10 subsidiary in the Channel Islands, and which money 11 was managed by College Trustees, in fact ended up 12 with their money in an account in the name of 13 Ansbacher in Guinness & Mahon, which is how they 14 become Ansbacher clients, and that was done because 15 between 1981 and 1989 College Trustees put its 16 money, the money belonging to its clients, on 17 deposit with Ansbacher? 18 A. 19 114 Q. 20 Yes. And Ansbacher had an account in Guinness & Mahon here? 21 A. 22 115 Q. Yes. It had that money in an account marked Guinness 23 Mahon Cayman Trust, which was the then name of 24 Ansbacher? 25 A. 26 116 Q. 27 A. 28 117 Q. 29 Yes. Reference College Trustees? Yes. And it appears that that is what happened to 1 that totally unwittingly your money ended up 2 in Ansbacher although you thought it was in 3 the Channel Islands most probably. 4 the connection...(INTERJECTION)? 5 Yes . 6 118 Q 7 A 8 Between the Channel Islands and Ansbacher? Well, it's strange because at one stage I met a Mr. Lipscombe. 9 119 Q 10 A 11 120 Q 12 A 13 Yes. From the Channel Islands; from College? From the Channel Islands. Yes ? And that was when I had the control of it. So, I was quite happy that it was there. 14 121 Q 15 A 16 17 That is Yes, yes? That's -- the other is -- it is what I suspected; that the money had been shifted. 122 Q Yes. However, that would have happened even if 18 it was still in your own name in College. 19 happened to all the College Trustee monies at 20 that particular period? 21 A 22 123 Q This It did? Yes. So, it would have made no difference. Anyway 23 just to clarify: 24 really is the picture of the relationship between 25 yourself and Mr. Stakelum; between yourself and 26 Guinness & Mahon; and how the money came to move 27 from one place to another; and how it was managed. 28 You have just explained to us, and this is helpful, 29 that you had the money in your own name in What we are trying to get clear 1 2 3 Yes . 124 Q Certainly in the Channel Islands up to a 4 particular date, which you cannot remember; 5 is that right? 6 A Yes. On dates, no. 7 125 Q Yes. You cannot even give me a general idea? 8 Was it the 1970's or the 1980's? 9 A 10 126 Q I haven't a clue what it was. All right. At a particular point Mr. Stakelum 11 persuaded you that it would be advantageous to 12 you to have it in this pooled account and you 13 agreed? 14 A 15 127 Q 16 How was that done? pooled account was? 17 A 18 128 Q 19 A 20 129 Q 21 A 22 130 Q 23 24 Yes . Did he give you any details? Well, I thought it was still in Jersey. Did he say it was? Or Guernsey. Did he say it was? No, I assumed it. I see. You agreed that your money would be transferred to that. A Where did he tell you this How was that then done? I would -- sorry, I am not too sure that I am 25 taking you up right. 26 arrange the transfer of it? 27 131 Q 28 A 29 Yes? Did you say: How did I 1 132 Q 2 A 3 133 Q 4 A 5 134 Q Yes, yes. That had to be closed or at least partially emptied? I haven't a clue how it was done. However, who did it? I mean you gave instructions 6 somewhere; did you? It did not happen by some kind 7 of, you know, magic? 8 A 9 the transfer of the money from Kircubbin to 10 11 Guinness & Mahon...(INTERJECTION). 135 Q 12 13 Yes, but I couldn't tell you today how say However, what I am trying to get at...(INTERJECTION)? A May be I gave a letter or something saying that 14 you can transfer the monies from -- but I don't 15 remember. 16 136 Q I haven't a clue as to how it was done. You probably would have written to College Trustee 17 or to whoever was dealing with your money and said 18 that you wished this to happen. 19 have had to tell them where you wanted it to go; is 20 that not right? 21 A However, you would In hindsight it is -- yes, I would agree with you 22 but in memory I cannot say how and I presume I gave 23 some sort of authorisation. 24 137 Q 25 A 26 138 Q 27 A 28 139 Q 29 A Yes ? To the bank. Yes? To transfer. Yes? 1 140 Q 2 3 A 4 I can't remember, no. If I asked you what you were doing in 1974 could you answer me? 5 141 Q 6 A 7 142 Q I could actually, yes? You could? Any way, Mr. Murray, moving on from that: Would 8 it be a correct summary of your evidence so far 9 to say that in 1974 you deposited some funds with 10 Guinness & Mahon in Dublin? 11 A 12 143 Q 13 Yes . Those funds were then transferred to the North of Ireland; is that right? 14 A No. 15 144 Q No? 16 A 17 It was the Ulster Bank that the funds were put up in Kircubbin first. 18 145 Q 19 A Yes ? And then through Guinness & Mahon. It was 20 brought to Dublin I presume because I had an 21 account, a sizable account, in Guinness & Mahon. 22 146 Q 23 So, the funds were transferred from the North of Ireland to Dublin? 24 A 25 147 Q 26 A 27 I don't know how it in fact happened. Well...(INTERJECTION)? Whether it came to Dublin and went on or ...(INTERJECTION). 28 148 Q 29 A I am looking here at your statement, Exhibit 1? Yes . 1 And what you say is that in 1974 you deposited 2 money with Guinness & Mahon in College Green, 3 Dublin. 4 came from the North and maybe went via 5 Guinness & Mahon to the Channel Islands or is 6 this something different? 7 are talking about here in your statement, Exhibit 1? 8 A 9 150 Q 10 Did you or are these the funds that What is it that you That presumably is the money from Kircubbin. Mr. Murray, you say "presumably" but you wrote this statement? 11 A 12 151 Q 13 A 14 152 Q I did, yes. Just a few weeks ago? Yes . So, what were you talking about at the time that 15 you wrote it? 16 in 1974. You say that you received funds Received them from where? 17 A I presume I was thinking of the Kircubbin monies. 18 153 Q So, what you were saying here is that monies came down from the North of Ireland? 19 20 A 21 154 Q 22 23 Yes . You say you deposited them in Dublin; is that correct? A Is that what you in fact did? When I wrote that it didn't seem so problematic 24 as you seem to be making it. 25 They -- what I am saying there effectively I 26 think is that the money was transferred 27 through Guinness & Mahon. 28 Yes? 29 I cannot remember. 1 156 Q 2 A 3 157 Q 4 To Guernsey. I see. That is not actually what you say here but that is what you mean? 5 A 6 158 Q 7 That is. That the money was transferred through Guinness & Mahon to Guernsey? 8 A 9 159 Q 10 Yes . And that money in Guernsey, which was in your own name for sometime; we do not know how long? 11 A 12 160 Q Yes . Was ultimately transferred into a general account, 13 combined account, whatever we would like to call 14 it, in -- held by Mr. Stakelum; is that correct? 15 A 16 161 Q Yes, yes. During the time that your money was being managed 17 by Mr. Stakelum you believed it was still in the 18 Channel Islands; is that correct? 19 A 20 162 Q 21 22 Yes . Did you believe it was still in exactly the same Institution that your funds had been in previously? A 23 I never thought about it like that but...(INTERJECTION). 24 163 Q 25 A 26 164 Q 27 A 28 165 Q 29 A Pardon? I never thought about it. However, you did not think...(INTERJECTION)? I would have I think if I had. Yes? 1 166 Q 2 Yes. You did not think Mr. Stakelum was minding it for you somewhere? 3 A No. 4 167 Q No. That is grand. As you know we are 5 investigating the company Ansbacher and we are 6 not interested actually in the individual people's 7 personal tax affairs except insofar as that relates 8 to possible wrongdoing on the part of Ansbacher 9 the bank. One of the things we are asked to look 10 at is whether Ansbacher conducted its affairs in a 11 way that enabled the creditors of other people to 12 be defrauded and in order to find out whether that 13 is the case we must ask individual clients whether 14 in fact they used the facilities of Ansbacher. 15 Now, I appreciate you did not know you were using 16 Ansbacher's facilities at all? 17 A 18 168 Q Yes . However, insofar as you were using the Channel 19 Islands ones for that similar purpose that is 20 relevant to us. 21 did not declare the income that was placed on 22 deposit to the Revenue Commissioners? 23 A 24 169 Q You have already said here you Yes . I now must ask you: Did you declare the 25 interest that was earned on the deposit to 26 the Revenue? 27 A 28 170 Q 29 No. 1 2 171 Q 3 A 4 172 Q 5 A 6 173 Q 7 A 8 174 Q 9 A 10 However, Mr. Cush might like to ask you one or two? Just this thing of Ansbacher? Yes ? I didn't even know about Ansbacher. I know. I appreciate that? I never heard of them. Yes, yes. Thank you very much, Mr. Murray? Thank you. MR. CUSH: I have no questions, 11 Mr. Murray. 12 A 13 175 Q Thank you. MS. MACKEY: Okay. 14 Thank you very much for coming in? 15 A 16 176 Q All right. We do not need to talk to Mrs. Murray at all. 17 I think that is perfectly clear. 18 explained to us that she was not involved. 19 may have signed things at your request but it was 20 not in her own right? 21 A Yes. You have In fact she would be very -- she is 22 very or she was very annoyed at my lack of 23 intercommunication during my practice years. 24 177 Q All right. Thank you very much, Mr. Murray? 25 A All right. Thank you. 26 27 28 29 THE EXAMINATION THEN CONCLUDED. She Hum g?Hoz Ha?z 0020.ng . E. 9% gr QWWMA 0,9231, $6 or C67 23 147 24 Q. When did that start7 A. I am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service 1 A. If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 Q. Could you not be a little bit more specific because 10 you know these terms, I don't know. 11 explaining them to us? 12 P., Would you mind If the client wished to place the funds with me and 13 th^y were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 16 17 151 18 Q. This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in 19 20 the sense of what interest rate...(INTERJECTION). 152 21 22 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 They were asking me whether I could monitor those funds on their behalf. 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say 'We have funds offshore' wherever 31 1 they might have been 'Can you look after these funds 2 for me.' 3 155 Q. 4 "Can you look after these funds." What did that mean? 5 A. Would you endeavour to get the best interest rate. Would you monitor the funds. ' 6 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into same other financial 7 156 Q. 10 institution? 11 A. I don't think they would come in and say 'We have 12 funds. 13 fiujincial institution.' 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other I think, a discussion would Q. What does that mean? ' A. It. means that they might not want to correspond 19 directly with whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 And that Q. What did you do then? A. I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 in this connection? 5 A. It means I would probably have contacted 6 Des Traynor. 7 — 8 were — 9 by me.' 10 What does that mean 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients that wishes to have funds monitored abroad Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A. .14 You have a client. Des Traynor is to give me an account number, a reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — might be 18 moved to a receiving bank. 19 162 Q. This is very important. Those funds — If you don't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 33 1 164 Q. 2 What was the account, in whose name was the account to be placed? 3 A. I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. 8 All I am saying is You must have known the financial institution in which your clients's funds were going to be placed? 9 A. The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. 13 Tell me some of them that were used that Mr. Traynor would have told you about. .14 Give me the names of some of those, Mr. Stakelum? 15 A. It is very difficult unde? oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 so etc. etc.. 20 that. 21 If it was dollars it might be something else. 22 167 Q. 23 I don't know. But I am not absolutely positive of It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? 24 A. I -don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 29 168 Q. I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other r 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. 5 6 That is not wanting to be uncooperative, I just cannot remember. 169 7 8 I just cannot answer that. 170 Q. Why can't you remember? A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 9 ‘ the Guinness & Mahon subsidiaries in Cayman or in 10 the Channel Islands? 11 A. I don't think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. I am not too sure. It may have been the account of Guinness & Mahon in 18 Dublin or Guinness & Mahon in London. 19 offshore bank we are talking about, Guinness & Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 24 172 25 26 173 Has this the They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? A. 1 I c a n n o t rem em b er. I s u s p e c t t h a t som e o f t h e 2 i n s t r u c t i o n s g iv e n a t t h e tim e w o u ld b e w h a t w as a t 3 t h e b e s t r e q u ir e m e n t s o f t h e G u in n e s s & Mahon b a n k , 4 w h a t t h e i r i n t e r n a l . . . (INTERJECTION). 5 174 Q, A fe w m in u te s a g o you t o s a i d t o me t h a t y o u g a v e 6 M r. T r a y n o r i n s t r u c t i o n s a n d t h a t y ou t r a n s f e r r e d 7 f u n d s t o h im an d t h e y w e re t r a n s f e r r e d o f f s h o r e , 8 th a t not rig h t. 9 m in u te s ago? A. 10 175 13 14 D id n ’ t y o u s a y t h a t t o me a few T h ey w e re p r o b a b ly o f f s h o r e a l r e a d y . I t h o u g h t we w e re t a l k i n g a b o u t a c l i e n t . . . (INTERJECTION). 11 12 176 Q. T h e y w e re o f f s h o r e a l r e a d y y o u t h i n k ? A. Y*>s, m o s t o f t h e fu n d s w e re o f f s h o r e a l r e a d y . Q. A l l t h e f u n d s o f t h e s e c l i e n t s we a r e t a l k i n g a b o u t 15 w e re o f f s h o r e . 16 t o y o u w i t h f u n d s t h a t w e r e n 't o f f s h o r e ? 17 18 is 177 19 D id y ou e v e r h a v e c l i e n t s c o m in g i n A. Y e s. Q. W hat w o u ld h a p p e n th e n ? A. A t d i f f e r e n t s ta g e s , in th e e a r ly s ta g e s I th in k 20 I r i s h p o u n d s c o u ld b e c o n v e r t e d w i t h o u t a n y p r o b le m 21 in to S te rlin g . 22 1 9 7 0 's . 23 178 24 25 26 179 I t i s o n e a n d t h e sam e i n t h e T h e n - th e y c o u ld b e m oved fro m S t e r l i n g . Q. W ere t h e y p u t o f f s h o r e , t h e f u n d s ? A. Y e s. Q. W here? A. A l l I know i s t h a t w ith Des T r a y n o r I w o u ld h a v e 27 a ssu m e d G u in n e s s Mahon Cayman T r u s t , l a t e r 28 A n sb a c h er. 29 C o lle g e T r u s t e e s o r G u in n e s s & Mahon G u e r n s e y . B u t i t c o u ld w e l l h a v e b e e n 1 180 2 3 181 Q. A. Y e s , I a ssu m e o n e o r t h e o t h e r . Q. D id a n y o f y o u r c l i e n t s t o y o u r k n o w le d g e e s t a b l i s h 4 t r u s t s w i t h t h e a s s i s t a n c e o f G u in n e s s & Mahon w i t h 5 M r. T r a y n o r e i t h e r i n t h e Cayman I s l a n d s o r i n t h e 6 C hannel Is la n d s ? 7 8 182 9 10 183 A. N o t t o my k n o w le d g e . Q. N one o f th e m t o l d y o u t h a t t h e y h a d d o n e t h i s ? A. N o. Q. M r. T r a y n o r d i d n ' t t e l l you t h a t h e w as g o in g t o s u g g e s t t h i s t o th em ? 11 12 13 ' 184 A. N o. Q. You a r e p r e t t y c e r t a i n o n t h a t o r a r e y o u d o u b t f u l about it? 14 15 A. I am n o t a w a re c e r t a i n l y o f a n y c l i e n t s t h a t 16 e s ta b lis h e d such t r u s t s . 17 t h a t d id . 18 185 Q. 20 22 ' I f t h e y d i d n ' t e s t a b l i s h t r u s t s , y o u a r e a w a re o f c l i e n t s who t r a n s f e r r e d fu n d s o f f s h o r e ? 19 21 186 A. Y e s, t h a t ' s rig h t. Q. We w i l l b r e a k now f o r a c u p o f c o f f e e , M r. S ta k e lu m , f o r a b o u t t e n m i n u te s o r s o . 23 24 25 26 27 28 29 I am n o t a w a re o f a n y SHORT ADJOURNMENT 18* October2000 Mr. Jack Stakelum “Fainnonf’ BallyronanRoad Kilpeddnr Co. Widdow . . StrictlyPrivate& Confidential-AddresseeOnly . Dear Sir referto your icwer of 11 October 2000, and Irrp'y «" «w own behalf, and on behalfofmy colleagues,Mr. JusticeDedan CostelloandMr. PaulRowan. 1 » • We now wishtoexamineyou under oathconcerningthematterssetoutinourtwo Idlers dated 30 August 2000 and 21 September 2000. To that'end, 1propose thatan interviewwould take placeinour officesatfeeabove address,dtheronWednesday 8 oron Thursday 9 November, at 10.00 a.m. Perhapsyou would make contactwifeoursecretary,Ms Frances Gaynor atfeeabove phonenumber toconfirmdtherdale,ortomake mutuallyconveoiertalternativearrangementsif those datesdo notsuityou. * We noteyour refusaltoprovideus withnames ofyourclientspriortoexamination.Imustpoint outtoyou featyou are obligedby law toprovideus withfeeinformationwe have required of you. In featregard, I referyou to Appendix B of our two letters,which sets out our statutory powers. You willnotefeatsection 10(5) oftheCompaniesAct 1990 imposes adutyuponyou to comply wife our requirement, and, in fee case of a refusal to do so, mkes provision forthe mattertobe dealtwithby theHigh Court I therefore repeat our requirement thatyou provide us wife the names and addresses of those clientswho you may have advised inrelationtomists infeeCayman or Channd Islands, or m relation to the transfer of ftinrin to either of those islands. We require this information to be provided inwritingpriortotheinterview. We havenotedalsoyour expressedintentionto argue atinterviewthatitwould be invidioustodisdosefeeidentityofyour clients.Once again,Imust pointouttoyou thatyou areobligedto do so,incompliancewifeourrequirement The interview isnottheproper forum inwhich tomake submissions,anditisnotourpracticetoentertainthem. Yours faithfully — r ar aa “FAIRMONT" BALLYRONAN ROAD K1LPEDDER CO. WICKLOW JA C K S T A K E L U M CHARTEREDACCOUNTANT . TELEPHONE: 2810646 FAX: 2810645 MOBILE: 0872854660 m s The Inspectors 3- Floor TridentHouse Blackrock AC» 9 “ y o . n in T fTW 6 November, 2000 Dear S in , . Withrexemncotoyourletterofthe18*October,andinparticularthethird paragraph,lshouldpointoutthatIdidnotretUseu suchtoprovidetheinformationis question,merelythatIshouldbeaffordedtheopportunitytoargue why Ishouldnotbe askedtodivulgesuchinformation. Thepersonsinquestiondealtwithme on an understandingofconfidentiality,andaatheInspectorswillsurelyappreciate,itisdifficult nottohonourthatconfidentiality,particularlywhen onehasbeenused,overone’s professionallife,tohonouringtheconfidentialityofClients. " However, asyoupointoutforcefullyinyourletter,you arenotpreparedtoallow me thatopportunityandyou havereferredtothelegalpositioa Inthecircumstances,I attach alistofthenamesandaddressesofthepersonsinquestion. Yoursfhithfully, End; & IC L O S U <20 : U :J 7 £ 4 - n e g hi . '# ' r* A. C.Murray, ElVoano, UpperMountown,Dun Laoghaire,Co.Dublin. n r s ( p /m tc T ) JOHN J.STAKELUM . “Fairmont” Baltyronan Road, Kilpedder, Co. Wicklow. 21 February2 0 0 1 . The High CourtInspectors, 3 Floor, . Trident House, Blackrock, Co. Dublin. ’v»s rs'ft JflW ’ Re: Interviewswith the Inspectors on 8/11/2000 and (5/12/2000. Dear Inspectors, The content in sections 1 and 2 has been written in orderto add clarificationto the information given in my Statement dated 22 September 2000. ‘ ‘ 1. The Consultancy Business Isetup In 1975. ■ ■ » la December 1975 I decided to sal up a business that would provide a general financial Consultancyservicetoclients. Ihad identifiedthemarket need inHaughey Boland & Company during my auditing work but more particularlyduring my receivership, liquidationand financial restructuringexperience. The servicesIdecidedtofocuson were: • Preparation ofproperty assembled requests for financing frombanks. • Preparationofwell constructedprojectedcashflowandprofitand lossstatements. • Accompanying clientsatmeetingswiththeirbankers. • The presentationofmeaningful management accounts and the procedures within businesses "forthetimelyproductionofthem. • Being a sonoJ' .5 board for aii Kinds of operating issues - both problems and perceived otmortunxtes. • Guidance onwhere togo and how torequestprofessionalservices. • Helping businesses In difficulty to get back to profitability or to move logically to receivership orliquidation. . . • Acting forclientsinthepurchaseorsaleofbusinesses. • Acting ina non-ExecutiveDirectorcapacitywhen requestedto do so. Those were die principal service headings under which I operated in the name of Business Enterprises Limited from December 1975 untilmy retirement on the 31 October 1998; This business was busy, demanding and successful. Typically, itoccupied well over 100% of 50hourweeks. . 2. The serviceI gave topersonswho wished to hold fends offshore. Involvement with the savings of clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalistbasis. Towards thismy stipulationswere: • Funds would be depositedinlicensedbanks atratesofinterestthatwould be competitive and market related. This empowered depositors to be satisfied concerning both safety and interestrates. • All decisions inrelationto movements inthesefUnds would be conveyed to me directly and orallyby thepersonconcerned; 0 I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling of investments. • Iwould tjeitherissue'norobtain,receiptsformovements infunds. Neither would Ikeep any ledgerrecprds, issuestatementsorengage incorrespondence. • Information in relation to balances and rates ofinterest would be provided on an oral basis only. • Originally, no charge was envisaged for this service but over time itbecame necessary to recover costson a case by case basis. My operatingprocedure forthisservicehad butfourcomponents: •* • • • • A depositaccountinG & M thatIhavedescribedasahotchpotchaccount. A manual memorandum record Ikeptinmy officeunder my personalcontrol. A floataccountinAIB. A monthly reconciliation of the sum of the memorandum records with the sum of the account(s)inG & M and any floatbalances. IntheinterestofcompletenessperhapsIshouldadd also: • G & M would be aware ofthetotalfundsIhad inmy hotchpotchaccount • G & M would sot be aware of the names of the depositors whose funds, in aggregate, comprised Hie :»Jnnee in the hotchpotch account albeit that a name and an amount couIU surfaceasparttuanotherbusinesstransactionwiththebamc; e.g.a back-to-backloan. • dome of my clients would be aware generally that the funds they held offshore were in a G & M vehicle. Other clientswould be aware thattheir funds were offshore but would have no awareness orcareaboutthename ofthebank inwhich theirmoney was deposited. • Only I knew the names inthe memorandum account and only I knew the ownership of the balance inthefloataccountkept inAIB. ' S. The information requested by Ms. Mackey on the 6 December 2000. The information requested by Ms. Mackey on 6 December'2000 isgiven in the three schedules thatare appended tothisletter. Schedule 1 relatesto the listofnames Isentto the Inspectorson 6 November 2000. All on this schedule had offshoredeposits inG & M throughmy procedure. Yours sincerely, Nune. A.C.Mumy. Yen. MID Badman. . . . scrawny: Dunn-pun Oct-Doped Sandman: SmofFunds Opmod. Maud mm IMPomda curly 19800. a. 1987!?. All. Nam. Office o f the Inspectors, 3rd Floor, Trident House, Blackrock, Co. Dublin. 4 St. Johns, Park Avenue, Sandymount Dublin 4. 2 1st November ’01 Dear Sir, With reference to your letter o f the 16th inst., I wish to state that at no time had I funds in Ansbacher nor was I a client o f Ansbacher. There is no evidence or proof that I was such a client. I have read Mr. Stakelum’s extract and he does not state that I had funds in Ansbacher Cayman or that I was aware that such funds had been deposited on my behalf. The fact that Mr. Stakelum listed me as one o f his clients does categorically not prove that I had any account with Ansbacher. I have at all times stated that I was a client o f Guinness Mahon and that, subsequent to that, I was approached by Mr. Stakelum to handle the funds on my behalf in order to obtain a better interest rate. He alone deposited the funds and I was not aware o f the location o f the account. th I have read through the transcript o f my examination on the 30 January 2001 and, looking at some o f the questions and answers and in particular numbers 113, 114, 115, 116 and 117, it appears that when I said ‘yes’, I was agreeing with the Inspector, Ms. Mackey. This was not the case. I was saying ‘yes’ as a matter o f courtesy that I was attentive to what she was saying. I would again stress that I was not a client o f Ansbacher Cayman. Yours faithfully, A p p e n d ix X V (1 6 1 ) M r W illia m Q u in n & M r s E ile e n Q u in n 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr William Quinn & Mrs Eileen Quinn. a) Extract of Transcript o f evidence of Mr Jack Stakelum dated 8 November 2000. b) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. c) Letter of 6 November 2000 with enclosures to Inspectors. d) Extract of letter from Mr Jack Stakelum to Inspectors o f 21 February 2001 with enclosure. e) Letter of 30 March 2001 from Mr Paul J Quinn. 23 147 24 Q. When d i d t h a t s t a r t ? A. I am i n c l i n e d t o b e l i e v e 1 9 7 6 b u t i t m ig h t h a v e b e e n 25 1977. 26 i o n ly h ad one y e a r o f o p e ra tio n s in 1975. 27 148 Q. I w o u ld h a v e s t a r t e d o n my own i n l a t e 1975. W ould y o u t e l l u s w h a t t h e a r r a n g e m e n t i n a g e n e r a l 28 w ay w as w i t h M r. T r a y n o r . 29 o p e ra te d ? How w as t h i s s e rv ic e r A. 1 I f I c a n t a k e a t y p i c a l e x a m p le , a c l i e n t m ay h a v e 2 a s k e d me t o l o o k a f t e r f u n d s t h a t i n a l m o s t a l l 3 c a s e s t h a t I am a w a re o f w e re a l r e a d y a b r o a d . 4 I w o u ld h a v e a s k e d M r. T r a y n o r t o a d v i s e me w h e re 5 t h e f u n d s m ig h t b e t r a n s f e r r e d t o , 6 c l i e n t w o u ld i s s u e i n s t r u c t i o n s w hen I g o t t h e 7 t r a c k i n g r o u t e o r a c c o u n t name o r c o d e o r w h a t e v e r 8 t h e y m ig h t b e . 9 10 149 Q. C o u ld y o u n o t b e a l i t t l e y o u know t h e s e t e r m s , . an d th e n th e b i t m o re s p e c i f i c b e c a u s e I d o n ' t know . W ould y o u m in d e x p l a i n i n g th e m t o u s ? 11 A. 12 I f t h e c l i e n t w is h e d t o p l a c e t h e f u n d s w i t h me a n d 13 t i . y w e re i n som e R o y a l B ank o f S c o t l a n d i n J e r s e y 14 o r w h e re v e r. 15 150 16 17 151 18 Q. T h is i s c l i e n t 's A. Y es. Q. Why w o u ld t h e y w a n t t o p l a c e t h e i r f u n d s w i t h y o u ? A. T h e y m ig h t b e u n h a p p y a b o u t m o n i t o r i h g t h e f u n d s i n 19 20 t h e s e n s e o f w h a t i n t e r e s t r a t e . . . (IN TER JEC TIO N ). 152 21 22 153 Q. B u t y o u w e re n o t a b a n k ? A. N o. Q. T h e y w e re a s k i n g y o u r a d v i c e a s t o w h e re t o p u t t h e 23 fu n d s? 24 A. 25 26 o f y o u rs? T h e y w e re a s k i n g me w h e t h e r I c o u l d m o n i t o r t h o s e fu n d s on t h e i r b e h a lf . 154 Q. M o n ito r i s a w o rd y o u u s e ; I d o n ' t u n d e r s t a n d i t . 27 Y o u r c l i e n t s h a v e f u n d s a n d t h e y come i n t o y o u . 28 W hat do t h e y a s k y o u t o d o ? 29 A. T h ey w o u ld s a y 'We h a v e f u n d s o f f s h o r e ' w h e r e v e r *31 1 t h e y m ig h t h a v e b e e n 'C a n y o u lo o k a f t e r t h e s e f u n d s 2 f o r m e .' 3 155 Q. 4 W hat d i d t h a t m ean ? 5 A. W ould y o u e n d e a v o u r t o g e t t h e b e s t i n t e r e s t r a t e . W ould y o u m o n i to r t h e f u n d s . 6 7 "C an yo u lo o k a f t e r t h e s e f u n d s . " 156 Q. T ake i t s lo w ly . ' W ould y o u e n d e a v o u r t o g e t t h e b e s t 8 in te re s t ra te . W ere t h e y a s k i n g y o u t o c h a n g e 9 w h e re t h e i r f u n d s w e re i n t o som e o t h e r f i n a n c i a l in s titu tio n ? 10 A. 11 I d o n ' t t h i n k t h e y w o u ld come i n a n d s a y 'We h a v e 12 fu n d s. 13 f i . n c ia l in s titu tio n .' 14 h a v e a r o s e w i t h th e m t h a t t h e y w o u ld h a v e a d v i s e d iue 15 t h a t t h e y h a d £X i n f u n d s a n d s a y 'C a n y o u l o o k 16 a f t e r t h e s e f u n d s o n my b e h a l f . ' 17 157 18 W i l l y o u c h a n g e th e m f o r som e o t h e r I t h i n k a d i s c u s s i o n w o u ld Q. W hat d o e s t h a t m ean? A. I t m e an s t h a t t h e y m ig h t n o t w a n t t o c o r r e s p o n d 19 d i r e c t l y w i t h w h a te v e r f o r e i g n b a n k t h e y w e re u s i n g . 20 T h e y m ig h t n o t w a n t t o g e t m a i l r e c e i v e d fro m 21 f o r e i g n b a n k s on t h e b a s i s o f m o n th ly s t a t e m e n t s . 22 T h e y w o u l d n 't f e e l t h a t n e c e s s a r i l y c o m p e te n t a b o u t 23 l o o k i n g a t w h e th e r t h e f u n d s s h o u l d b e p l a c e d 24 o n e m o n th o r t h r e e m o n th s o r s i x m o n th s . 25 t h e y w o u ld l i k e me t o lo o k a f t e r t h o s e f a c t o r s . 26 27 158 And t h a t Q. W hat d i d y o u d o t h e n ? A. I w o u ld p r o b a b l y a d v i s e th e m a t som e s t a g e t h a t 28 t h e r e w o u ld b e a f a c i l i t y a v a i l a b l e t h r o u g h 29 G u in n e s s & M ahon. 1 159 2 3 160 Q. You t h e n c o n t a c t e d G u in n e s s & Mahon? A. Y e s. Q. You u s e d t h e w ord " f a c i l i t y . " 4 W hat d o e s t h a t m ean i n t h i s c o n n e c ti o n ? 5 A. I t m eans I w o u ld p r o b a b l y h a v e c o n t a c t e d 6 Des T r a y n o r . 7 — f o r t h e m o s t p a r t h e w o u l d n 't know who my c l i e n t s 8 w e re — t h a t w is h e s t o h a v e f u n d s m o n i t o r e d a b r o a d 9 b y m e .' 10 161 Q. I w o u ld h a v e s a i d D o n 't u s e d t h e w ord " m o n ito r e d " b e c a u s e I d o n 't 11 u n d e r s t a n d w h a t i t m e a n s. 12 W hat i s h e t o do? 13 A. ' I have a c lie n t You h a v e a c l i e n t . De... f r a y n o r i s t o g i v e me a n a c c o u n t n u m b e r, a 14 r e f e r e n c e , a b a n k w h ere t h e c l i e n t who w o u ld h a v e 15 t h e f u n d s w o u ld h a v e t o g i v e i n s t r u c t i o n s t o h i s 16 b a n k t o h a v e t h e fu n d s m oved. 17 I d o n 't u n d e r s t a n d t h e s e t h i n g s e i t h e r — m ig h t b e 18 m oved t o a r e c e i v i n g b a n k . 19 162 Q. T h is i s v e r y im p o r ta n t. T h o se f u n d s — I f you d o n 't u n d e r s t a n d i t , 20 I u n d e rs ta n d even l e s s . 21 c l i e n t w ith fu n d s i n J e r s e y . 22 th a t th is c lie n t is d is s a tis fie d . 23 M r. T r a y n o r t h e n d o ? 24 A. L et us ta k e a t y p ic a l He g i v e s me c o d e d r e f e r e n c e s . You t e l l M r. T r a y n o r W hat d o e s I d o n 't rem em b er b u t 25 i t m ig h t w e l l b e a r e f e r e n c e t o a b a n k a c c o u n t i n 26 L ondon f o r s o a n d s o , f o r t h e a c c o u n t o f s o a n d s o . 27 28 29 163 Q. W hat w as t h e b a n k ? A. M r. C o s t e l l o , I d o n 't rem em ber a n d I am s u r e t h o s e i n s t r u c t i o n s w o u ld h a v e v a r i e d o v e r t h e y e a r s . 33 -r > 1 164 Q. t o be p la c e d ? 2 3 A. I h a v e a d i f f i c u l t y a n s w e r in g t h a t q u e s t i o n , not 4 w a n tin g t o b e u n c o o p e r a tiv e . 5 t h a t M r. T r a y n o r w o u ld b e s e e k i n g t o g e t t h e f u n d s 6 u n d e r h is c o n tr o l and th e r e i s a t r a n s f e r p r o c e s s . 7 Q. 165 9 A. 10 . in f u n d s w e re g o i n g t o b e p l a c e d ? The o n ly a n sw e r I can g iv e t o t h a t i s I d o n 't r e c a l l b e c a u s e o v e r th e y e a rs th e y p ro b a b ly u se d d i f f e r e n t fin a n c ia l in s titu tio n s . 11 12 A l l I am s a y i n g i s You m u s t h a v e known t h e f i n a n c i a l i n s t i t u t i o n w h ic h y o u r c l i e n t s ' s 8 166 Q. T e l l me som e o f th e m t h a t w e re u s e d t h a t 13 fix. 14 n a m es o f som e o f t h o s e , M r. S ta k e lu m ? 15 /-s. W hat w as t h e a c c o u n t , i n w h o se nam e w as t h e a c c o u n t A. r r a y n o r w o u ld h a v e t o l d y o u a b o u t . G iv e me t h e I t i s v e ry d i f f i c u l t unde? o a th , b u t l e t u s t r y 16 G u in n e s s & M ahon L o n d o n f o r a s t a r t . 17 B u t i f i t w as G u in n e s s & Mahon L o n d o n , i t w o u ld 18 p ro b a b ly b e a c c o u n t o f so and s o , r e f e r e n c e so a n d 19 s o e t c . e tc w . I d o n ' t know . B u t I am n o t a b s o l u t e l y p o s i t i v e o f 20 th a t. 21 I f i t w as d o l l a r s i t m ig h t b e s o m e th in g e l s e . 22 167 Q. 23 I t c o u l d a l s o v a r y d e p e n d in g o n t h e c u r r e n c y . W hat o t h e r f i n a n c i a l i n s t i t u t i o n d i d h e t e l l y o u t h a t t h e m oney w as g o in g t o b e d e p o s i t e d i n ? 24 A. I d o n ' t know , I j u s t d o n ' t know . I t w o u ld b e a 25 o n c e -o ff in s tru c tio n . 26 w o u ld d e p e n d o n w h e re t h e f u n d s w e re c o m in g fr o m 27 to o . 28 29 168 Q. I d o n ' t know . I t p ro b a b ly Do y o u r b e s t . I am s u r e y o u a r e u n d e r s t r a i n , M r. S ta k e lu m . T e l l me t h e n u m b e rs o f o t h e r 34 1 i n s t i t u t i o n s t h a t c l i e n t s o f y o u r s h a d m oney 2 d e p o s ite d a s a r e s u l t o f y o u r c o n ta c t w ith 3 M r. T r a y n o r ? 4 A. 5 6 b e u n c o o p e ra tiv e , 169 7 8 I j u s t c a n n o t an sw er t h a t . 170 T h a t i s n o t w a n tin g t o I j u s t c a n n o t re m e m b e r. Q. Why c a n ' t y o u rem em b er? A. How do I a n s w e r a q u e s t i o n o f why I c a n n o t re m e m b e r? Q. F o r e x a m p le , w e re a n y o f t h e f u n d s l o d g e d i n a n y o f 9 ’ t h e G u in n e s s & Mahon s u b s i d i a r i e s i n Caym an o r i n th e C hannel Is la n d s ? 10 A. 11 I d o n 't th i n k s o . B u t I t h i n k t h e f u n d s w o u ld b e 12 in itia lly 13 G .’ u n e s s Mahon C aym an, r e f e r e n c e n u m b e r s o a n d s o , 14 m aybe f o r t h e a c c o u n t i n G u in n e s s & Mahon L o n d o n f o r 15 G u in n e s s & Mahon D u b lin . 16 You w o u ld g e t s p e c i f i c i n s t r u c t i o n s . 17 171 Q. lo d g e d so m ew h ere m aybe f o r t h e a c c o u n t o f I am n o t t o o s u r e . I t m ay h a v e b e e n t h e a c c o u n t o f G u in n e s s & M ahon i n 18 D u b lin o r G u in n e s s & Mahon i n L o n d o n . 19 o f f s h o r e b a n k we a r e t a l k i n g a b o u t , G u in n e s s & M ahon 20 Caym an T r u s t , t h e A n s b a c h e r b a n k . 21 b e e n lo d g e d i n i t s 22 its 23 24 172 25 26 173 Was t h i s t h e T h e y w o u ld h a v e a c c o u n t i n D u b lin o r lo d g e d i n a c c o u n t i n London? A. I t m ay w e l l h a v e b e e n , I d o n ' t re m e m b e r. Q. B u t y o u a r e u n d e r o a t h now? A. T h a t 's r i g h t . Q. You a r e u n d e r o a t h . Can y o u s a y t h a t f u n d s y o u r 27 c l i e n t h a d a s k e d y o u i n r e l a t i o n t o a s s i s t a n c e w e re 28 lo d g e d i n a n a c c o u n t i n t h e name o f G u in n e s s M ahon 29 Caym an T r u s t i n D u b lin o r i n L o n d o n ? A. 1 I c a n n o t rem em b er. I s u s p e c t t h a t some o f t h e 2 i n s t r u c t i o n s g iv e n a t t h e tim e w o u ld b e w h a t was a t 3 t h e b e s t r e q u ir e m e n ts o f t h e G u in n e s s & Mahon b a n k , 4 w h a t t h e i r i n t e r n a l ...(IN T E R JE C T IO N ). 5 174 Q. A few m in u te s ag o you t o s a i d t o me t h a t y ou g a v e 6 M r. T r a y n o r i n s t r u c t i o n s a n d t h a t y ou t r a n s f e r r e d 7 f u n d s t o him a n d t h e y w e re t r a n s f e r r e d o f f s h o r e , 8 th a t not rig h t. 9 m in u te s a g o ? A. 10 175 13 14 D i d n 't you s a y t h a t t o me a few T hey w e re p r o b a b ly o f f s h o r e a l r e a d y . I t h o u g h t we w e re t a l k i n g a b o u t a c l i e n t . . . (INTERJECTION). 11 12 176 Q. T h ey w e re o f f s h o r e a l r e a d y you t h i n k ? A. i . Q. A l l t h e f u n d s o f t h e s e c l i e n t s we a r e t a l k i n g a b o u t mo s t o f t h e fu n d s w ere o f f s h o r e a l r e a d y . 15 w e re o f f s h o r e . 16 t o you w i t h fu n d s t h a t w e r e n 't o f f s h o r e ? 17 18 is 177 19 D id you e v e r h a v e c l i e n t s co m in g i n A. Y e s. Q. W hat w o u ld h a p p e n th e n ? A. A t d i f f e r e n t s ta g e s , in th e e a r ly s ta g e s I th in k 20 I r i s h p o u n d s c o u ld b e c o n v e r te d w i t h o u t a n y p ro b le m 21 in to S te rlin g . 22 1 9 7 0 's . 23 178 24 25 26 179 I t i s one a n d t h e sam e i n t h e T hen -th e y c o u ld b e moved fro m S t e r l i n g . Q. W ere t h e y p u t o f f s h o r e , t h e fu n d s ? A. Y e s. Q. W here? A. A l l I know i s t h a t w ith Des T r a y n o r I w o u ld h a v e 27 a ssu m e d G u in n e s s Mahon Cayman T r u s t , l a t e r 28 A n sb a c h er. 29 C o lle g e T r u s t e e s o r G u in n e s s & Mahon G u e rn s e y . B ut i t c o u ld w e l l h a v e b e e n 1 180 2 3 181 Q. One o r t h e o t h e r ? A. Y e s , I a ss u m e o n e o r t h e o t h e r . Q. D id a n y o f y o u r c l i e n t s t o y o u r k n o w le d g e e s t a b l i s h 4 t r u s t s w i t h t h e a s s i s t a n c e o f G u in n e s s & M ahon w i t h 5 M r. T r a y n o r e i t h e r i n t h e Cayman I s l a n d s o r i n t h e 6 C hannel Is la n d s ? 7 8 182 9 10 183 A. N o t t o my k n o w le d g e . Q. N one o f th e m t o l d y o u t h a t t h e y h a d d o n e t h i s ? A. N o. Q. M r. T r a y n o r d i d n ' t t e l l y ou t h a t h e w as g o i n g t o s u g g e s t t h i s t o th e m ? 11 12 13 184 A. N o. Q. Y.*, a r e p r e t t y c e r t a i n o n t h a t o r a r e y o u d o u b t f u l 14 about it? 15 A. I am n o t a w a re c e r t a i n l y o f a n y c l i e n t s t h a t 16 e s ta b lis h e d su ch t r u s t s . 17 th a t d id . 18 185 Q. 20 22 I f th e y d i d n 't e s t a b l i s h t r u s t s , 25 26 27 28 29 you a r e a w a re o f 186 A. Y es, t h a t ' s rig h t. Q. He w i l l b r e a k now f o r a c u p o f c o f f e e , M r. S ta k e lu m , f o r a b o u t t e n m i n u t e s o r s o . 23 24 I am n o t a w a re o f a n y c l i e n t s who t r a n s f e r r e d f u n d s o f f s h o r e ? 19 21 ' SHORT ADJOURNMENT 3e*a^f 18®*October2000 Mr. JadeStakelum “Fairmont” BallyronanRoad Kilpedder Co. Wicklow StrieflyPrivate& Confidential- Addressee Only . . Dear Sir T **f-rtn ymrr letterof 11 October 2000, and Ireply on any own behalf, and on behalfofmy colleagues,Mr. JusticeDeclan CostelloandMr. Paulivuwau. We now wish toexamineyou under oathconcerningthematterssetoutinourtwo lettersdated 30 August 2000 and 21 September 2000. To that“end, Ipropose that an interviewwould take place inour offices atthe above address, eitheron Wednesday 8 oron Thursday 9 November, at 10.00 a.m. Perhaps you would make contactwith our secretary,Ms Frances Gaynor attieabove phone number toconfirm eitherdate,ortomake mutually conveniertalternativearrangements if thosedatesdo notsuityou. ' We noteyour refusaltoprovideus withnames ofyour clientspriortoexamination Imustpoint outto you thatyou are obliged by law to provideus withthe informationwe have required of you. In thatregard, I referyou to Appendix B of our two letters,which sets out our statutory powers. You willnotethatsection 10(5) oftheCompanies Act 1990 imposes adutyuponyou to comply with our requirement, and, in the case of a refusal to do so,mdces provision for the mattertobe dealtwithby theHigh Court I therefore repeat our requirement thatyou provide us with the names and addresses of those clients who you may have advised in relationtotrustsintheCayman or ChannelIslands, or in rdation to the transfer of funds to dlher of those islands. We require this information to be provided inwritingpriortoHieinterview. We havenotedalsoyour expressedintentionto argue atinterviewthatitwould be invidious to disdosetheidentityofyour clients. Once again,Imust pointouttoyou thatyou areobligedtodo so,incompliancewithourrequirement The interview isnottheproper forum inwhich tomake submissions,and itisnotourpracticetoentertainthan. Yours faithfully n w B . TELEPHONE: 2810646 FAX: 2810645 MOBILE: 087 2854660 The Inspectors 3* Floor Trident House Blackrock “FAIRMONT" BALLYRONAN ROAD KILPEDDER CO. WICKLOW S K AOK 9 “ 6 November, 2000 DearSirs, . With i t .. ence to your letter of the 18* October, and m particular the third rarwnph, I should point that I did not •• «•»* «»wide the information in question, merely that I should be afforded the opportunity to aigue why I should not be asked to divulge such information. The persons in question dealt with me cman understanding of confidentiality, and aa the Inspectors will surely appreciate, it is difficult not to honour that confidentiality, particularly when one has been used, over erne’s professional life, to honouring the confidentiality ofClients. " However, as you point out forcefully in your letter, you are not prepared to allow me that opportunity and you have referred to the legal position. In the circumstance^ I Attach a list of the names and addresses ofthe penons in question. Yours fiuthfblly, End; . L tfr fe fc . 6 • r £ fci . ff’ n I/**s BillQuinn,c/oPaulQuinn,25theQuany,Portmarnock,Ca Dublin.(deceased) ( ) JOHN J.STAKELUM “Fairmont” Ballyronan Road, Kilpedder, Co. Wicklow. The content insections 1 and 2 has been writteninorderto add clarificationto the information given in my Statement dated 22 September 2000. ' 1. The Consultancy Business Isetup in 1975. , • In December 1975 I decided to set up a business that would provide a general financial Consultancyservice to clients. 1had identifiedthemarket need inHaughey Boland & Company during nay auditing work but more particularlyduring my receivership, liquidation and financial restructuringexperience. The servicesIdecidedtofocuson were: ■ • • • • • • • • • • _ /* *»■ '■ ■ Preparationofproperlyassembledrequestsforfinancingfrom banks. Preparationofwell constructedprojectedcashflowandprofitand lossstatements. Accompanying clientsatmeetingswiththeirhankers. The presentationofmeaningful management accounts and the procedures within businesses forthetimelyproductionofthem. Being a soim-’*^ board for all lands of operating issues - both problems and percel,*^ opportunites. Lruidance on wnere togo and how torequestprofessionalservices. Helping businesses in difficulty to get back to profitability or to move logically to receivership orliquidation. . Acting forclientsinthepurchase orsaleofbusinesses. Acting ina non-ExecutiveDirectorcapacitywhen requestedtodo so. Those were the principal service headings under which I operated in the name of Business Enterprises Limited from December 1975 untilmy retirement on the 31 October 1998. This business was busy, demanding and successful Typically, itoccupied well over 100% of 50­ hour weeks. ........ , 2. The service I gave to personswho wished tohold Hands offshore. Involvement with the savings of clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalist basis. Towards thismy stipulationswere: • Funds would be depositedinlicensedbanks atratesofinterestthatwould be competitive and market related. This empowered depositors to be satisfied concerning both safety and interestrates. • All decisions inrelationto movements inthese funds would be conveyed to me directly and orallyby theperson concerned; ° I w ould undertake no advisory or management role in relation to these funds and this fact w as com m unicated to each person w ith particular reference to decisions that concerned the buying or selling o f investments. • Iwould oeitherissuenor obtainreceipts formovements in funds. Neither would Ikeep any ledgerrecords, issuestatementsorengage incorrespondence. • Information in relation to balances and ratesofinterest would be provided on an oral basis only. • Originally, no charge was envisaged for this service but over time itbecame necessary to recovercostson a caseby case basis. My operatingprocedureforthisservicehad butfourcomponents: i • • • • * A depositaccount inG & M thatIhavedescribedasahotchpotchaccount. A manual memorandum record Ikeptinmy officeundermy personalcontrol. A floataccountinAIB. A monthly reconciliation of the sum of the memorandum records with the sum of the account(s) inG & M and any floatbalances. IntheinterestofcompletenessperhapsIshouldadd also: • G & M would be aware ofthetotalfundsIhad inmy hotchpotchaccount • G & M would not be aware of the names of the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount ce"'A surfeceaspartv anotherbusinesstransactionwiththetauL, e.g.a back-to-backloan. • Sczzz cfmy clients wouIJ Lo aware geiMoiij uuai iuu uuuls they held offshore were in a G & M vehicle. Other clientswould be aware thattheirfunds were offshore but would have no awarenessor careaboutthename ofthebank inwhichtheirmoney was deposited. • Only I knew the names inthe memorandum account and only I knew the ownership of the balance inthefloataccountkeptinAIB. The informationrequested by Ms. Mackey on 6 December'2000 isgiven inthe three schedules thatare appendedtothisletter. Schedule 1 relatestothelistofnames IsenttotheInspectorson 6 November 2000. Allon this schedule had offshoredepositsinG & M throughmy procedure. Yours sincerely, SCHEDULE 1 Name. efflu- Baum New mom Sourcnamedo Soumoamem Dapodb Buck loan. Opened S'oud om; Palm Bill Quinn. You. No. Lab 1970:. On dam uncertain. All. Nan. aywnomaama Inspectorsto Ansbacher (Cayman) Ltd., 3rd.Floor, TridentHouse, Blackrock, Co. Dublin. PaulJ.Quinn, 25, The Quarry, Portmarnock, Co. Dublin. Your Ref. C/Q02/NSPM 13*. March 2001. Dear Sir/Madam, Iam inreceiptofyourletterofthe9th.Inst,and inresponseIwould liketo make the followingunsworn statementasrequested: My latefatherWilliamQuinn diedin 1985.1 understandthatatthattimemy late mother was informedoftheexistenceofan accountheldby Mr. Jack Stakehimof BusinessEnterprisesLtd. on my fathersbehalf.At thattimeIunderstandthatmy mother nomfcm:me asa contacton theaccount.Follovnng my motliersdeathin Tnlyr>f1 997 anrf when contactedby Mr. S*"1'"1— ",''z nc about the account. At no stagewas Imade aware ofanyconnectionofthisaccountto any particularinstitutionotherthanthatthemoney was “offshore”.Thisaccount was closedinOctober of1997. Specificallydealingwithmattersassetout inAppendix C ofyour letterIwould like to respondpointby pointaspertheAppendix: 1. Ineverhad anydealingswithCaymen IslandTrustsand Trust companies. Ineverhad anydealingswithGuinness& Mahon (Ireland)Ltd. 3. Ineverhad any dealingswithIrishIntercontinentalBank Ltd. 4. As with2.above. 5. As with3.above. 6 . IneverappliedforpermissioninrelationtotheExchange controlacts. 7. Ineverhad any dealingswithany ChannelIslandtrustsor companies. 8 . No bodiescorporateconnected withme had any dealingswiththecompany, 2. My onlypointofcontact inthismatterhas beatand isMr. Jack Stakelumand Ihave alreadybeenincontactwithhim inan efforttoobtainanyrecordshe may have in relationtotheaccount. He informed me thathe has notretainedanyrecords concerning my latefatherormother. Yours Sincerely, PaulJ.Quinn. A p p e n d ix X V (1 6 2 ) D r T o m T ie rn a n 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Dr Tom Tiernan. a) Extract of transcript o f evidence o f Mr Jack Stakelum dated 8 November 2000 . 2. b) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. c) Letter of 6 November 2000 and enclosure from Mr Stakelum to Inspectors. d) Letter of 21 February 2001 and enclosures from Mr Stakelum to Inspectors. e) Statement of Dr Tom Tiernan dated 30 January 2001. Correspondence received from or on behalf of Dr Tom Tiernan. a) Letter of 3 December 2001 - Dr Tom Tiernan to the Inspectors. 23 147 24 Q. When d i d t h a t s t a r t ? A. i am i n c l i n e d t o b e l i e v e 1976 b u t i t m ig h t h a v e b e e n 25 1977. 26 I o n ly h a d o n e y e a r o f o p e r a t i o n s i n 1 9 7 5 . 27 148 Q. I w o u ld h a v e s t a r t e d o n my own i n l a t e 1 9 7 5 . W ould yo u t e l l u s w h at t h e a rra n g e m e n t i n a g e n e r a l 28 way w as w i t h M r. T r a y n o r . 29 o p e ra te d ? How w as t h i s s e r v i c e o : 1 A. I f I c a n t a k e a t y p i c a l e x a m p le , a c l i e n t may h a v e 2 a s k e d me t o lo o k a f t e r fu n d s t h a t i n a lm o s t a l l 3 c a s e s t h a t I am a w a re o f w e re a l r e a d y a b r o a d . 4 I w o u ld h a v e a s k e d M r. T r a y n o r t o a d v i s e me w h e re 5 t h e fu n d s m ig h t b e t r a n s f e r r e d t o , a n d t h e n t h e 6 c l i e n t w o u ld i s s u e i n s t r u c t i o n s when I g o t t h e 7 t r a c k i n g r o u t e o r a c c o u n t name o r c o d e o r w h a te v e r 8 t h e y m ig h t b e . 9 149 Q. 10. C o u ld you n o t b e a l i t t l e b i t m o re s p e c i f i c b e c a u s e yo u know t h e s e te r m s , I d o n 't know. W ould y o u m in d e x p l a i n i n g th e m t o u s ? 11 12 A. I f t h e c l i e n t w is h e d t o p l a c e t h e f u n d s w i t h me a n d 13 t h e y w e re i n some R o y a l Bank o f S c o t l a n d i n J e r s e y 14 o r w h e re v e r. 15 150 16 17 151 IB A. Q. T h i s i s c l i e n t ' s o f y o u rs ? A. Y e s. Q. Why w o u ld t h e y w a n t t o p l a c e t h e i r f u n d s w i t h y o u ? T hey m ig h t b e u n h a p p y a b o u t m o n i to r in g t h e f u n d s i n 19 20 t h e s e n s e o f w h a t i n t e r e s t r a t e - . , (INTERJECTION). 152 21 22 153 Q. B u t you w e re n o t a b a n k ? A. No. Q. T hey w e re a s k i n g y o u r a d v ic e a s t o w h e re t o p u t t h e 23 funds? 24 A. 25 26 T hey w e re a s k i n g me w h e th e r I c o u ld m o n ito r t h o s e f u n d s on t h e i r b e h a l f . 154 Q. M o n ito r i s a w ord you u s e ; I d o n 't u n d e r s t a n d i t . 27 Y our c l i e n t s h a v e fu n d s an d t h e y come i n t o y o u . 28 What do t h e y a s k y ou t o do? 29 A. T hey w o u ld s a y 'We h a v e fu n d s o f f s h o r e ' w h e r e v e r 31 1 t h e y m ig h t h a v e b e e n 'C a n y o u l o o k a f t e r t h e s e f u n d s 2 f o r m e .' 3 Q. 4 5 W hat d i d t h a t m ean? A. W ould y o u e n d e a v o u r t o g e t t h e b e s t i n t e r e s t r a t e . W ould y o u m o n i t o r t h e f u n d s . 6 7 "C an y o u lo o k a f t e r t h e s e f u n d s . " Q. T ake i t s lo w ly . ’ W ould y o u e n d e a v o u r t o g e t t h e b e s t 8 in te re s t ra te . 9 w h e re t h e i r f u n d s w e re i n t o some o t h e r f i n a n c i a l in s titu tio n ? 10 11 W ere t h e y a s k i n g y o u t o c h a n g e A. I d o n ' t t h i n k t h e y w o u ld come i n a n d s a y 'We h a v e 12 fu n d s. W i l l yo u c h a n g e th e m f o r som e o t h e r 13 fin u n c ia l i n s t i t u t i o n .' 14 h a v e a r o s e w i t h th e m t h a t t h e y w o u ld h a v e a d v i s e d me 15 t h a t t h e y h a d £X i n f u n d s a n d s a y 'C a n y o u l o o k 16 a f t e r t h e s e f u n d s on my b e h a l f . ' I t h i n k a d i s c u s s i o n w o u ld 17 Q. W hat d o e s t h a t m ean? 18 A. I t . m e a n s t h a t t h e y m ig h t n o t w a n t t o c o r r e s p o n d 19 - d i r e c t l y w i t h w h a t e v e r . f o r e i g n b a n k t h e y w e re u s i n g . 20 T h e y m ig h t n o t w a n t t o g e t m a i l r e c e i v e d fr o m 21 f o r e i g n b a n k s o n t h e b a s i s o f m o n th ly s t a t e m e n t s . 22 T h e y w o u l d n 't f e e l t h a t n e c e s s a r i l y c o m p e te n t a b o u t 23 l o o k i n g a t w h e th e r t h e f u n d s s h o u l d b e p l a c e d 24 o n e m o n th o r t h r e e m o n th s o r s i x m o n th s . 25 t h e y w o u ld l i k e me t o lo o k a f t e r t h o s e f a c t o r s . And t h a t 26 Q. W hat d i d y o u do th e n ? 27 A. I w o u ld p r o b a b l y a d v i s e th e m a t som e s t a g e t h a t 28 t h e r e w o u ld b e a f a c i l i t y a v a i l a b l e t h r o u g h 29 G u in n e s s & M ahon. 1 159 2 3 160 Q. You t h e n c o n t a c t e d G u in n e s s & M ahon? A. Y es. Q. You u s e d t h e w o rd " f a c i l i t y . " 4 in th is 5 A. W hat d o e s t h a t m ean c o n n e c tio n ? I t m e a n s I w o u ld p r o b a b l y h a v e c o n t a c t e d 6 D es T r a y n o r . 7 — f o r t h e m o s t p a r t h e w o u l d n 't know who my c l i e n t s 8 w e r e — t h a t w is h e s t o h a v e f u n d s m o n i t o r e d a b r o a d 9 b y m e .' 10 161 Q. I w o u ld h a v e s a i d D o n 't u s e d t h e w o rd " m o n i to r e d " b e c a u s e I d o n ' t 11 u n d e r s ta n d w hat i t m eans. 12 W hat i s h e t o d o ? 13 A. 'I have a c l i e n t Det; T r a y n o r i s You h a v e a c l i e n t . t o g i v e me a n a c c o u n t n u m b e r, a 14 re fe re n c e , 15 t h e f u n d s w o u ld h a v e t o g i v e i n s t r u c t i o n s t o h i s 16 b a n k t o h a v e t h e f u n d s m o v ed . 17 I d o n 't u n d e r s ta n d th e s e t h i n g s e i t h e r — m ig h t b e 18 m oved t o a r e c e i v i n g b a n k . 19 162 Q. a b a n k w h e re t h e c l i e n t who w o u ld h a v e T h is i s v e ry im p o r ta n t. T hose fu n d s — I f you d o n 't u n d e r s ta n d i t . 20 I u n d e rs ta n d even l e s s . 21 c l i e n t w ith fu n d s in J e r s e y . 22 th a t th is c lie n t is d is s a tis fie d . 23 M r. T r a y n o r t h e n d o ? 24 A. L et u s ta k e a ty p ic a l He g i v e s me c o d e d r e f e r e n c e s . You t e l l M r. T r a y n o r W hat d o e s I d o n ' t re m e m b e r b u t 25 i t m ig h t w e l l b e a r e f e r e n c e t o a b a n k a c c o u n t i n 26 London f o r so an d s o , f o r th e a c c o u n t o f s o an d s o . 27 28 29 163 Q. W hat w as t h e b a n k ? A. M r. C o s t e l l o , I d o n ' t rem em b er a n d I am s u r e t h o s e i n s t r u c t i o n s w o u ld h a v e v a r i e d o v e r t h e y e a r s . 1 164 Q. t o b e p la c e d ? 2 3 A. not w a n tin g t o b e u n c o o p e r a t i v e . 5 t h a t M r. T r a y n o r w o u ld b e s e e k in g t o g e t t h e f u n d s 6 u n d er h is c o n tr o l and th e r e i s a t r a n s f e r p r o c e s s . 165 Q. 9 A l l I am s a y i n g i s You m u s t h a v e known t h e f i n a n c i a l i n s t i t u t i o n i n w h ic h y o u r c l i e n t s ’ s fu n d s w e re g o in g t o b e p l a c e d ? 8 A. T he o n ly a n sw e r I c a n g iv e t o t h a t i s I d o n ' t r e c a l l 10 b e c a u s e o v e r t h e y e a r s t h e y p r o b a b ly u s e d d i f f e r e n t 11 fin a n c ia l in s titu tio n s . 12 166 Q, T e l l me some o f th e m t h a t w ere u s e d t h a t 13 M r. f r a y n o r w o u ld h a v e t o l d you a b o u t . 14 nam es o f some o f t h o s e , Mr. S ta k e lu m ? 15 ^ I h a v e a d i f f i c u l t y a n s w e rin g t h a t q u e s t i o n , 4 7 ^ W hat was t h e a c c o u n t , i n w hose name w as t h e a c c o u n t A. G iv e me t h e I t i s v e ry d i f f i c u l t unde? o a th , b u t l e t u s t r y 16 G u in n e s s & Mahon L ondon f o r a s t a r t . 17 B u t i f i t w as G u in n e s s & Mahon L o n d o n , i t w o u ld 18 p ro b a b ly b e a c c o u n t o f so and s o , r e f e r e n c e so and 19 so e tc . e tc . . I d o n ' t know . B u t I am n o t a b s o l u t e l y p o s i t i v e o f 20 th a t. 21 I f i t was d o l l a r s i t m ig h t b e s o m e th in g e l s e . 22 167 Q. 23 I t c o u ld a l s o v a r y d e p e n d in g o n t h e c u r r e n c y . W hat o t h e r f i n a n c i a l i n s t i t u t i o n d i d h e t e l l y o u t h a t t h e m oney w as g o in g t o b e d e p o s i t e d i n ? 24 A. I d o n 't know, I j u s t d o n 't know. I t w o u ld b e a 25 o n c e -o ff in s tr u c tio n . 26 w o u ld d e p e n d on w h e re t h e fu n d s w e re co m in g fro m 27 to o . 28 29 168 Q. I d o n 't know. I t p ro b a b ly Do y o u r b e s t . I am s u r e you a r e u n d e r s t r a i n , M r. S ta k e lu m . T e l l me t h e nu m b ers o f o t h e r 34 r 1 i n s t i t u t i o n s t h a t c l i e n t s o f y o u r s h a d m oney 2 d e p o s ite d a s a r e s u l t o f y o u r c o n ta c t w ith 3 M r. T r a y n o r ? 4 A. 169 7 8 T h a t i s n o t w a n tin g t o b e u n c o o p e r a t i v e , I j u s t c a n n o t re m e m b e r. 5 6 I j u s t c a n n o t an sw er t h a t . 170 Q. Why c a n ’ t y o u re m e m b er? ' A. How d o I a n s w e r a q u e s t i o n o f why I c a n n o t re m e m b e r? Q. F o r e x a m p le , w e re a n y o f t h e f u n d s lo d g e d i n a n y o f t h e G u in n e s s 6 Mahon s u b s i d i a r i e s i n Caym an o r i n 9 th e C hannel Is la n d s ? 10 A. 11 I d o n ’t t h i n k s o . B u t I t h i n k t h e f u n d s w o u ld b e 12 in itia lly 13 Gv.; n n e s s Mahon C aym an, r e f e r e n c e n u m b e r s o a n d s o , 14 m aybe f o r t h e a c c o u n t i n G u in n e s s & M ahon L o n d o n f o r 15 G u in n e s s & M ahon D u b lin . 16 Y ou w o u ld g e t s p e c i f i c i n s t r u c t i o n s . 17 171 Q. lo d g e d so m ew h ere m aybe f o r t h e a c c o u n t o f I am n o t t o o s u r e . I t m ay h a v e b e e n t h e a c c o u n t o f G u in n e s s & M ahon i n 18 D u b lin o r G u in n e s s & Mahon i n L o n d o n . 19 . o f f s h o r e b a n k we a r e t a l k i n g a b o u t , G u in n e s s & M ahon 20 Caym an T r u s t , t h e A n s b a c h e r b a n k . 21 b e e n lo d g e d i n i t s 22 its 23 24 172 25 26 173 Was t h i s th e T h e y w o u ld h a v e a c c o u n t i n D u b lin o r l o d g e d i n a c c o u n t i n London? A. I t m ay w e l l h a v e b e e n , I d o n ' t re m e m b e r. Q. B u t y o u a r e u n d e r o a t h now? A. T h a t 's r i g h t . Q. You a r e u n d e r o a t h . C an y o u s a y t h a t f u n d s y o u r 27 c l i e n t h a d a s k e d y o u i n r e l a t i o n t o a s s i s t a n c e w e re 28 lo d g e d i n a n a c c o u n t i n t h e nam e o f G u in n e s s M ahon 29 Caym an T r u s t i n D u b lin o r i n L o n d o n ? 1 A. I c a n n o t re m e m b e r. I s u s p e c t t h a t som e o f t h e 2 i n s t r u c t i o n s g i v e n a t t h e t i m e w o u ld b e w h a t w as a t 3 t h e b e s t r e q u i r e m e n t s o f t h e G u in n e s s & M ahon b a n k , 4 w h a t t h e i r i n t e r n a l ...(IN T E R J E C T IO N ). 5 174 Q. A fe w m i n u t e s a g o y o u t o s a i d t o me t h a t y o u g a v e 6 M r. T r a y n o r i n s t r u c t i o n s a n d t h a t y o u t r a n s f e r r e d 7 f u n d s t o h im a n d t h e y w e re t r a n s f e r r e d o f f s h o r e , 8 th a t not rig h t. 9 m in u te s ago? 10 A. 11 12 D i d n 't y o u s a y t h a t t o me a fe w T h e y w e re p r o b a b l y o f f s h o r e a l r e a d y . I t h o u g h t we w e r e t a l k i n g a b o u t a c l i e n t . . . (IN TERJECTIO N ). 175 13 14 17 6 0. T h e y w e re o f f s h o r e a l r e a d y y o u t h i n k ? A. Yc*-if m o s t o f t h e f u n d s w e re c f f s h o r e a l r e a d y . Q. A l l t h e f u n d s o f t h e s e c l i e n t s we a r e t a l k i n g a b o u t 15 w e re o f f s h o r e . 16 t o y o u w i t h f u n d s t h a t w e r e n 't o f f s h o r e ? 17 18 is 177 19 D id y o u e v e r h a v e c l i e n t s c o m in g i n A. Y es. Q. W hat w o u ld h a p p e n th e n ? A. A t d i f f e r e n t s ta g e s ,, in th e e a r ly s ta g e s I th in k 20 I r i s h p o u n d s c o u l d b e c o n v e r t e d w i t h o u t a n y p r o b le m 21 in to S te rlin g . 22 1 9 7 0 's . 23 178 24 25 26 179 I t i s o n e a n d t h e sam e i n t h e T h e n - t h e y c o u l d b e m oved fro m S t e r l i n g . Q. W ere t h e y p u t o f f s h o r e , t h e f u n d s ? A. Y es. Q. W h ere? A. A l l I know i s t h a t w i t h D es T r a y n o r I w o u ld h a v e 27 a s s u m e d G u in n e s s Mahon Cayman T r u s t , la te r 28 A n sb ach er. 29 C o l l e g e T r u s t e e s o r G u in n e s s & M ahon G u e r n s e y . B ut i t c o u ld w e ll h a v e b e e n 36 1 180 2 3 181 Q. One o r t h e o t h e r ? A. Y es, Q. D id a n y o f y o u r c l i e n t s t o y o u r k n o w le d g e e s t a b l i s h I assum e one o r th e o t h e r . 4 t r u s t s w i t h t h e a s s i s t a n c e o f G u in n e s s & M ahon w i t h 5 M r. T r a y n o r e i t h e r i n t h e Caym an I s l a n d s o r i n t h e 6 C hannel Is la n d s ? 7 8 182 9 10 183 A. N o t t o my k n o w le d g e . Q. N one o f th e m t o l d y o u t h a t t h e y h a d d o n e t h i s ? A. N o. Q. M r. T r a y n o r d i d n ' t t e l l y o u t h a t h e w as g o i n g t o s u g g e s t t h i s t o th e m ? 11 12 13 184 A. No. Q. You a r e p r e t t y c e r t a i n o n t h a t o r a r e y o u d o u b t f u l 14 about it? 15 A. I am n o t a w a re c e r t a i n l y o f a n y c l i e n t s t h a t 16 e s ta b lis h e d such t r u s t s . 17 th a t d id . 18 185 Q. 20 22 I f th e y d i d n 't e s t a b l i s h t r u s t s , 25 26 27 28 29 you a r e a w a re o f 186 A. Y es, t h a t ' s rig h t. Q. We w i l l b r e a k now f o r a c u p o f c o f f e e , M r. S ta k e lu m , f o r a b o u t t e n m i n u t e s o r s o . 23 24 I am n o t a w a r e o f a n y c l i e n t s who t r a n s f e r r e d f u n d s o f f s h o r e ? 19 21 ‘ SHORT ADJOURNMENT Our Ref: C/S1Q/NM ‘ 11 18*October 2000 Mr. JackStakelum “Fairmont” BallyronanRoad KQpedder Co. Wicklow StrictlyPrivate& Confidential- AddresseeOnly . . Dear Sir Ireferto yscr of 11 October 2000, and Ireply on my own behalf, and on behalfofnay colleagues,Mr. JusticeDedan CostelloandMr. PaulRowan. # We now wish toexamineyou underoathconcerningthematterssetoutinourtwo lritersdated 30 August 2000 and 21 September 2000. To that’end, Ipropose thatan interviewwould take placeinour officesatthe aboveaddress, eitheron Wednesday 8 oron Thursday 9 November, at 10.00 a.m. Perhaps you would make contactwithoursecretary,Ms Frances Gaynor attheabove phonenumber toconfirmeitherdate,ortomake mutuallyconvenientalternativearrangementsif thosedatesdo notsuityou. —v We noteyour refusaltoprovideus withnames ofyour dientspriortoexamination.Imustpoint outtoyou thatyou are obligedby law toprovideus withtheinformationwe have required of you. In thatregard, I refer you to Appendix B of our two letters,which sets out our statutory powers. You willnotethatsection 10(5) oftheCompaniesAct 1990 imposes adutyuponyou to complywith our requirement, and, in the case of a refusalto do so, nukes provision for the mattertobe dealtwithby theHigh Court I therefore repeat our requirement thatyou provide us with the names and addresses ofthose clientswho you may have advised in relationtotrustsintheCayman or ChannelIslands, or in relation to the transfer of funds to either of those islands We require this information to be provided inwritingpriortotheinterview. We have notedalsoyour expressedintentionto argue atinterviewthatitwould be invidiousto disclosedieidentityofyour clients.Once again,Imust pointouttoyou thatyou areobligedtodo so,incompliancewithourrequirement The interview isnottheproper foruminwhich tomake submissions,anditisnotourpracticetoentertainthem. Yours faithfully •FAIRMONT" BALLYRONAN ROAD KILPEDDER CO. WICKLOW JA C K ST A K E L U M CHARTEREDACCOUNTANT . TELEPHONE: 2810646 PAX: 2810645 MOBILE: 087 2854660 TheInspectors 3* Moor g. TridentHouse Biackrock » T r id e n t ffOi-PllPHJW 6 November,2000 Dear Sro, WithreiLencetoyourletterofthe18*Octobsr,andLaparticulartoethird prn^aph, IshoJdpoint iluuIcfidnotrcT---,_wlitctheinformationin question,merelythatIshouldbeaffordedtheopportunitytoarguewhy Ishouldnotbe askedtodivulgesuchinformation. Thepersonsinquestiondealtwithme onan understandingofconfidentiality,andastheInspector!willsurelyappreciate,ittsdifficult nottohonourthatconfidentiality,particularlywhenonehasbeenused,overone’s professionallife,tohonouringtheconfidentialityofClients. However,asyoupointcutforcefullyinyourletter,you arenotpreparedtoallow me thatopportunityandyouhavereferredtothelegalposition. Inthecircumstances,I attachalistofthenamesandaddressesofthepersonsinquestion. Yours&ithfUlly, S b& macaw -. 497794: emm?sMAi Tom Tiernan, 529 Howth Road. Rahuly, Dublin 5. (amt/T) JOHN J. STAKELUM ?Fairmont? Ballyronan Road, Kilpedder, Co. Wicklow. 21 February 2001. The High Court Inapectors, Floor, . Trident House, Blachoek, Co. Dublin. 5 Re: mom with the Inspector: on 8111/2000 and 6/12/2600. 'I'hecontentinsections given in my Statement dated 22 September 2000. 1. The Consultancy Bnsiiess I set op In 1975. . * In December 1975 I decided to set up a business that would provide a general financial Consultancy service toclients. Ihad identifiedthemarket need inHaughty Boland & Company during my andfting work but more particularlyduring ray receivership, liquidationand financial restructuring experience. The servicesIdecidedtofocuson were: • Preparationofproperlyassembledrequestsforfinancingfrom banks. • Preparationofwell constructedprojectedcashflowand profitand lossstatements. • Accompanying clients at meetings with their bankers. • The presentaifon nf trwnningfiil management flrannnta and the procedures within businesses for the timely production ofthem. • Being a sorakl? nnrtnrfiifjites. board for ali kinds of operating issues - both problems and percei.^I • Guidance on where to go and howto request professional services. • Helping businesses in difficulty to get back to profitability or to move logically to receivership orliquidation. . • Acting forclientsinthepurchase orsaleofbusinesses. • Acting ina non-ExecutiveDirectorcapacitywhen requestedtodo so. Those were the principal service headings under which I operated in the name of Business Enterprises Limited from December 1975 until my retirement on the 31 October 1998. This business was busy, demanding and successful. Typically, itoccupied well over 100% of 50hour weeks. ' 2. The service 1 gave to persons who wished to hold firads offshore. Involvement with the savings of clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalistbasis. Towards thismy stipulationswere: • Funds would be depositedinlicensed banks atratesofinterestthatwould be competitive and market related. This empowered depositors to be satisfied concerning both safety and interestrates. • All decisions inrelationto movements inthese funds would be conveyed to me directly and orallyby theperson concerned; • I would undertake no advisory or management role in relationto these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or sellingofinvestments. • Iwould neitherissue'norobtainreceiptsformovements influids. Neither would Ikeep any ledgerrecprds, issuestatementsorengage incorrespondence. • Information in relationto balances and ratesofinterestwould be provided on an oral basis only. • Originally, no charge was envisaged for this sendee but over time itbecame necessary to recover costson a caseby case basis. My operatingprocedureforthisservicehad butfourcomponents: i» ■• • • • A depositaccountinG & M thatIhave describedasahotchpotchaccount. A nMm»nl memorandum record Ikeptinmy officeunder my personalcontrol. A floataccountinAIB. A monthly reconciliation of the sum of the memorandum records with the sum of the accounts) inG & M and any floatbalances. IntheinterestofcompletenessperhapsIshouldadd also: • G & M would be awareofthetotalfttndsIhad innxyhotchpotchaccount • G & M would not be aware of the names of the depositors whose funds, in aggregate, compn«>ed the laboce in the hnt^fpntch account albeit that a name and an amount co>,M surfaceaspartol «™therbusinesstransactionwiththebank, e.g.a back-to-backloan. • bome of my ciieuis would be aware generallymat the ninds they held offshore were in a G & M vehicle. Other clientswould be aware thattheirfunds were offshore but would have no awareness or careaboutthename ofthebank inwhichtheirmoney was deposited. • Only Iknew the names inthe memorandum account and only I knew the ownership of the balance inthe floataccountkeptinAIB. 5. The information requested by Ms. Mackey on the6 December 2000. The information requested by Ms. Mackey on 6 December 2000 isgiven inthe three schedules thatareappended tothisletter. Schedule 1 relatesto the listofnames IsenttotheInspectorson 6 November 2000. Allon this schedule had ofishoredepositsinG & M throughmy procedure. Yours sincerely, mam? Name. O?dm Backto DdeDopodt Damn-pod: murmu- momma nape-m auto-u. om cm canna- mm Pom Tam Tiernln. You. Nu Early 1930: c. 1mm Una-mm Uncor?n. Rozel, 529 Howth Road, Raheny, Dublin 5. Telephone: 831 0994 ^ ^ J h> — / —- £ ~ t Orj b ^ i * r* * A '^ U S ^ J ^ & U J> y / / / Z V J * ~ /u . r U ^ H r y \ )0 J r. i q ? l /h s& rC trvy*> f/o fyjbiL. -jlu -r t'r fyyTsm't^ li^-£J--/cc_, K J {U jO h ^ * H /^ O / /^ £ £ > - IfaCtaU-tC J y j / L f —tt. *xj—& --£r} /h j? *. r /ly /J u 'tC jL -S tttfl < * (t« V 4 & l‘£ fj£ L 6 r r v ? J ib - . & .^ u j J /r/- &C • p& i\S tfh — fte 'ts + s L p * ~ 4 & ir* t'C 4 * i r l X f r U # * ^ vP i^l^L e^C /z ^ / i f Y T2 I'U r J io ^ f ^ h’ < ~ - Rozel, 529 Howth Road, Raheny, Dublin 5. Telephone: 831 0994 _ J ffa k 'fr 'f X - A ^ ftfc > (] *f( & ) & / i f l ? Rozel, 529 Howth Road, Raheny, &4 e r e m i Dublin 5. Telephone: 831 J — /£ - ln > D -a * -/ j L y / ' 11 O j Ht ^C fc r r . I. J r f~j fZ t'7 \ ^ A -t J fc /L r fijn + * • i^ tA J C*~~rF& v7£ti- fa p P '. p + * ^" dp j i ^ t ' f/L J vl u U U H p ^ £ Z S j^ & -‘^ U sC fr -'L ts fc J f~ i{**■• 4 / k J fa fr ~ / YH ft< V it^ \, fts jf$ p T t-fa f ./h iy 'H ? t -r ^ A 7!- O st C ^ L ^ r^ r-* ^ I* ~rrC & ) 0 7 ^ hu c?C'£rr>~^£'v$ .' 1% * £ 0994 ^ Rozel, 529 Howth Road, Raheny, Dublin 5. Telephone: 831 0994 U ^ _ tU . ^ p r ~ ? r - 7 t. 7 / /h fi Appendix XV (163) Mr Patrick Tolan 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Patrick Tolan. a) Extract of transcript of evidence of Mr Jack Stakelum dated 8 November 2000 . b) Letter of 18 October 2000 from Inspectors to Mr Jack Stakelum. c) Letter of 6 November 2000 and enclosure from Mr Stakelum to Inspectors. d) Letter of 21 February 2001 and enclosures from Mr Stakelum to Inspectors. e) Statement of Mr Patrick Tolan dated 26 February 2001. Correspondence received from or on behalf of Mr Patrick Tolan. a) Letter of 14 January 2002 - Peter O’Boyle & Company Solicitors to Secretary to the Inspectors. 23 147 24 Q. When did that start? A. 1 am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service 1 A. 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 10. Q. Could you not be a little bit more specific because you know these terms, I don't know. 11 Would you mind explaining them to us? 12 A. If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 Q. This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? 18 a. They might be unhappy about monitorihg the funds in 19 the sense 6f what interest rate...(INTERJECTION). 16 17 ^ If I can take a typical example, a client may have 20 151 152 21 22 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 a . They were asking me whether I could monitor those 25 26 funds on their behalf.' 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 a . They would say 'We have funds offshore1 wherever 31 1 they might have been 'Can you look after these funds 2 for me.1 3 155 Q. 4 mean? 5 A. 6 7 "Can you look after these funds." What did that - " Would you endeavour to get the best interest rate. Would you monitor the funds. ‘ 156 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial Q. 10 institution? 11 A. I don't think they would come in and say 'We have 12 funds. 13 financial institution.' I think a discussion would 14 have arose with them that they would have advised me 15 that they had £X in funds and Bay 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other Q. What does that mean? A. It. means that they might not want to■correspond 19 .directly with whatever foreign bank they .were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 And that Q. What did you do then? A. I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." 4 in this connection? 5 A. Des Traynor. 7 — 8 were — 9 by me. * 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients that wishes to have funds monitored abroad Don't used, the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A. - It means I would probably have contacted 6 10 What does that mean You have a client. Des Traynor is to give me an account number, a 14 15 reference, a bank where the client who would have 16 bank to have the funds moved. 17 I don't understand these things either — might be 18 moved to a receiving bank. 19 the funds would have to give instructions to his 162 Q. This is very important. Those funds — If you don't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 1 164 Q. 2 What was the account, in whose name was the account to be placed? 3 A. I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. 8 All I am saying is You must have known the financial institution in which your clients's funds were going to be placed? 9 A. The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. 13 Tell me some of them that were used that Mr. Traynor would have told you about. .14 Give me the names of some of those, Mr. Stakelum? 15 A. It is very difficult under oath, but let us try 16 Guinness & Mahon London for a start. 17 But If it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 so etc. etc. . 20 that. 21 If it was dollars it might be something else. 22 167 Q. 23 I don't know. But I am not' absolutely positive of It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? 24 a . I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 29 168 Q. I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other 34 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. 5 6 That is not wanting to be uncooperative, I just cannot remember. 169 7 8 I just cannot answer that. 170 Q. Why can't you remember? A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 9 ‘ the Guinness & Mahon subsidiaries in Cayman or in 10 the Channel Islands? 11 A. I don't think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. I am not too sure. It may have been the account of Guinness & Mahon in 18 Dublin or Guinness & Mahon in London. 19 offshore bank we are talking about, Guinness s Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 24 172 25 26 173 Was this the They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? 1 A. I cannot remember. I suspect that some of the 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 what their internal ...(INTERJECTION). 5 174 Q. A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A. 11 12 They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 175 13 14 Didn't you say that to me a few 176 Q. They were offshore already you think? A. Yes, most of the funds were offshore already. Q. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 18 177 19 Did you ever have clients coming in A. Yes. Q. What would happen then? A. At different stages,- in the early stages' I think 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 24 25 26 179 It is one and the same in the Then-they could be moved from Sterling. Q. Were they put offshore, the funds? A. Yes. Q. Where? A. All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey. But it could well have been fI 1 180 2 3 181 A. Yes, I assume one or the other. Q. Did any of your clients to your knowledge establish trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in the Cayman Islands or in the 6 Channel Islands? 8 182 ' A. Not to my knowledge. Q. None of them told you that they had done this? 9 A. 10 ' One or the other? 4 7 ^ Q. 183 Q. Mr. Traynor didn't tell you that he was going to 11 suggest this to them? 12 13 No. 184 A. No. Q. You are pretty certain on that or are you doubtful 14 about it? 15 A. I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q. 19 22 If they didn't establish trusts, you are aware of 186 A. Yes, that's right. Q. We will break now for a cup of coffee, Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 • clients who transferred funds offshore? 20 21 I am not aware of any : SHORT ADJOURNMENT .. 1? ,AppendixXV? I - 18thOctober 2000 Mr. Jack Stakdum “Fairmont” Ballyronan Road KUpedder . Co. Wicklow Strictly Private & Confidential -Addressee Only . . Dear Sir I refer to your letter of 11 October 2000, and I reply on my own behalf, and on behalf of my colleagues, Mr. Justice Declan Costello and Mr. Paul Rowan. We now wish to examine you under oath conccrning the matters set out in our two Irtters dated 30 August 2000 and 21 September 2000. To that’end, I propose that an interview would take place in our offices at fee above address, either on Wednesday 8 or on Thursday 9 November, at 10.00 a.m. Perhaps you would make contact wife our secretary, Ms Frances Gaynor at fee above phone number to confirm either date, or to make mutually convenient alternative arrangements if those dates do not suit you. ' ' We note your refusal to provide us with, names of your clients prior to examination. I must point out to you feat you are obliged by law to provide us wife fee information we have required of you. In that regard, I refer you to Appendix B of our two letters, which sets out our statutory powers. You will note feat section 10(5) of fee Companies Act 1990 imposes a duty upon you to comply wife our requirement* and, in fee case of a refusal to do so, m&es provision for the matter to he dealt with by the High Court ■ I therefore repeat our requirement feat you provide us wife the names and addresses of those clients who you may have advised in relation to trusts in fee Cayman or Channel Islands, or in relation to the transfer of funds to either of those islands. We require feis information to be provided in writing prior to fee interview. We have noted also your expressed intention to argue at interview feat it would be invidious to disdose fee identity of your clients. Once again, I must point out to you feat you are obliged to do so, in compliance wife our requirement The interview is not the proper forum in which to make submissions, and it is not our practice to entertain them. Yours faithfully JACK STAKELUM CHARTKRBD ACCOUNTANT . TELEPHONE: 2810646 PAX: 2810645 MOBILE: 087 2854660 .. The Inspectors 3* Floor Trident House Blackrock “FAIRMONT" BALLYRONAN ROAD K1LPEDDER CO. WICKLOW « s r ao» 6 November, 2000 DearSirs, . With reference to your letter of the 18* October, and in particular the third paragraph, I should point out that I did not refiise as such to provide the information in question, merely dot I should be afforded the opportunity to argue why I should not be asked to divulge such information. The persons in question dealt with me on an understanding o f confidentiality, and as the Inspectors will surely appreciate, it is difficult not to honour that confidentiality, particularly when one has been used, over cate’s professional life, to honouring the confidentiality of Clients. " However, as you point out fbrcefidly in your letter, you are not prepared to allow me that opportunity and you have referred to the legal positxra. In the circumstances, I attach a list of the names and addresses ofthe persons in questioa End: Pat Tuba, 40 Wuhan Dublin 14. .. ?00 tit:- :41? ( P fJ W 'T ? JOHN J. STAKELUM . “Fairmont” ■ Ballyronan Road, Kilpedder, Co. 'Wicklow. 21 February 2001. The High Court Inspectors, 3"1Floor, . Trident House, Blackrock, Co. Dublin. ' '•? g rtf* WM S c Interviews with the Inspectors on 8/11/2000 and 6/12/2000. Dear Inspectors, The content in sections 1 and 2 has been written in order to add clarification to the information given in my Statement dated 22 September 2000. ' 1. T he C onsultancy B o siie ss I set np in 1975. •i • In December 1975 I decided to set up a business that would provide a general financial Consultancy service to clients. I had identified the market need in Haughey Boland & Company during my auditing work but more particularly during a y receivership, liquidation and financial restructuring experience. The services I decided to focus on were: • • • • Preparation o f properly assembled requests for financing from banks. Preparation o f well constructed projected cash flow and profit and lossstatements. Accompanying clients at meetings with their bankers. The presentation o f meaningful management accounts and the procedures within businesses for the timely production o f them. • Being a sounding board for all kinds o f operating issues - both problems and perceived opportunites. • Guidance on where to go and how to request professional services. • Helping businesses in difficulty to get back to profitability or to move logically to receivership or liquidation. . . ■ • Acting for clients in the purchase or sale o f businesses. • Acting in a non-Executive Director capacity when requested to do so. Those were the principal sendee headings under which I operated in the name o f Business Enterprises Limited from December 1975 until my retirement on the 31 October 1998. This business was busy, demanding and successful. Typically, it occupied well over 100% o f 50hour weeks. 2. T he service I gave to persons w ho wished to hold fin d s offitoore. Involvement with the savings o f clients in any capacity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalist basis. Towards this nay stipulations were: • Funds would be deposited in licensed banks at rates o f interest that would be competitive and market related. This empowered depositors to be satisfied concerning both safety and interest rates. • All decisions in relation to movements in these funds would be conveyed to me directly and orally by the person concerned; « I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling o f investments. • I would neither issuenor obtain.receipts for. movements in funds. Neither would I keep any ledger records, issue statements or engage in correspondence. • Information in relation to balances and rates of interest would be provided on an oral basis only. • Originally, no charge was envisaged for this service but over time it became necessary to recover costs on a case by case basis. '~ My operating procedure for this service had but four components: » • • • • * A deposit account in G&M that I have described as a hotchpotch account. A manual mftmnranrfiim record I kept in my office under my personal control. A float account in AIB. A monthly reconciliation o f the sum o f the memorandum records with the sum o f the accounts) in G&M and any float balances. In the interest o f completeness perhaps I should add also: • • • • G&M would be aware o f the total ftinds I had in my hotchpotch account G&M would not be aware o f the names o f the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could surface as part of another business transaction with the bank, e.g. a back-to-back ban. Some o f my clients would be aware generally that the foods they held offshore were in a G&M vehicle. Other clients would be aware that their funds were oAshore but would have no awareness or care about the name o f the bank in which their money was deposited. Only t knew the names in tbs memorandum account and only I knew the ownership o f the balance in the float account kept in AIB. ' The jnfnrmntinnrequested by Ms. Mackey on 6 December'2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list o f names I sent to the Inspectors on 6 November 2000. schedule had ofMore deposits in G&M through xny procedure. i Yours sincerely, All on this Name. O?dm Buckie Damped! Datum :Soumaomeds SourcoufFunds Dapodb Buck loan. Open-d Cloud Offdm Ind! Pounds. 1. Pat Tolln. You. No. 5st 19600. c. 1967.68 None. All. IN THE MATTER OF THE COMPANIES ACTS 1963 TO 1990 AND IN THE MATTER OF PART II OF THE COMPANIES ACTS 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (FORMERLY GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED AND CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) THE HIGH COURT 1999 NO. 163 COS ' STATEMENT OF PAT TOLAN This unsworn statement is made by me in response to a request for assistance by the Inspectors appointed in the above proceedings to investigate the affairs of the above named company (“the Company”). I have never had any direct dealings with the Company. The only transactions through which I might have had indirect dealings with the Company were with Mr. Jack Stakelum o f‘Fairmont”, Baliyronan Road, Kilpedder, Co. Wicklow. I was in receipt of untaxed income in the period 1983 to 1988. This income was paid to me in an annual lump sum by cheque. I gave these cheques to Jack Stakelum who at that time had an office in Clyde Road, Dublin 4. My arrangement with him was that he would place the money on deposit with other money in an undisclosed account and whenever I wanted some o f it back I would contact him by telephone and tell him how much I wanted. He would tell me when the money would be available and I would go to his office and collect it in cash. This would usually take one or two days. I received no documents and maintained no records in relation to this arrangement. The understanding was that Mr. Stakelum would deduct part of the income from the deposit as his fee. I understood the money that I placed with him was deposited with other monies in a form of general account. I was not informed where the account was held or how the deposit was operated. I did not know how the withdrawals were made. My understanding was that if anything happened to me that the fund would be paid out to my family. In or about 1990 I gave further sums of money to Mr. Stakelum under the same arrangement. In the years 1994 and 1995 I requested monthly payments in the form of bank drafts payable to Leeson Park Nursing Home where my mother resided until she died in September 1995. I do not recall what bank the drafts were drawn on but I believe that it was an Irish bank. In early 1998 I was informed by Mr. Stakelum that he proposed to cease providing this service and he suggested I open an account in the Irish Permanent Isle of Man Branch into which he would transfer the balance of funds standing to my account. I opened an account in Irish Permanent (IOM) Limited of St. James’s Chambers, 64a Athol Street, Douglas, Isle of Man in joint names of myself and my wife Paula Tolan. On receipt of a letter from the Inspectors dated 24thJanuary 20011 consulted my solicitor Peter O’Boyle who wrote to Jack Stakelum on 7th February enclosing copies of the documents received from the Inspectors seeking any information or documents that would be of assistance to the Inspectors. Mr. Stakelum replied to my solicitor on 16* February 2001 in which he confirmed that he maintained an account through Guinness & Mahon for offshore funds but had no information or documents that would be of assistance. I attach a copy of my solicitor’s letter to Mr. Stakelum and Mr. Stakelum’s reply. I also attach a copy o f the opening statement with Irish Permanent (IOM) Limited showing a lodgement to that account on 17* April 1998. I have instructed my solicitor to write to Irish Permanent (IOM) Limited seeking a copy of any document evidencing the transfer of that money into that account and the source of that money. I have no records or documents relating to my transactions with Mr. Stakelum. The only dealings I have had with the Company are the possible indirect dealings I may have had through Jack Stakelum. If I did have such dealings with the Company, such dealings were without my knowledge at the time such dealings took place. All transactions that may have been with the Company have been personal on my part, no company or trust having been involved. In relation to such transactions I never executed any documents or obtained any documents save on those occasions when I obtained a bank draft which I gave to Leeson Park Nursing Home to pay my mother’s account there. The person I usually dealt with was Mr. Stakelum. On occasion, I dealt with his secretary whose name I believe is Ann, or with a man called lan. 1 dealt with no other person in relation to these matters except them. I was not informed where funds were deposited. I did not at any time execute a deed of trust or other instrument in the Cayman Islands or elsewhere whereby the Company or any other person associated with it or acting at its direction was a trustee or managed the trust I am not aware whether accounts in the name of Amiens Securities Limited, Amiens Investment Limited or Kentford Securities Limited were used either to lodge or withdraw monies from the Company’s account with Guinness & Mahon (Ireland) Limited or Irish Intercontinental Bank Limited. I am not aware o f any code number used to designate my account in which the record of any service such as I have described in this statement was maintained although I assume that some such system must have existed. I never availed of any service involving a loan and guarantee facility through Mr. Stakelum or in relation to the Company or any of the companies mentioned in the documents received by me from the Inspectors. I am not aware that I or anyone on my behalf applied under the Exchange Control Acts for permission in relation to the transactions that I describe in this statement. I never availed o f any o f the services referred to in the documents furnished by the Inspectors relating to the deposit entitled“Guinness Mahon Cayman Limited - re College Trustees”. There are no bodies corporate which had dealings with the Company in which I had any direct or indirect interest or which were directly or indirectly controlled by me or whose income or part of whose income I had power to enjoy, nor are there any subsidiaries o f such bodies corporate or any other entities related to such bodies corporate and there were no Trusts which had dealings with the Company in which I had any direct or indirect interest whether as Settlor, Trustee of Beneficiary or whose income or part of whose income I had power to enjoy so far as I am aware. Dated: 2 (o February 2001 Signed: PATTOLAN Ref: 3d/Tolan Pat No.6/statemeat of Pat Tolan 20.2.01 P E T E R O 'B O Y L E & C O M P A N Y S o lic ito r s C o m m i s s i o n e r s fo r O a t h s 7 N o r th G r e a t G e o r g e s S tr e e t D u b lin 1 T e l: (0 1 ) 8 7 4 6 8 0 2 F a x : (0 1 ) 8 7 4 6 8 0 9 E -m a il: o b o y le c o @ e ir c o m .n e t Frances Gaynor, Secretary to the Inspectors, 3ld Floor Trident H ouse, Blackrock, Co. Dublin. Our Ref: P/TO L003-6/A H Re: Your Ref: CT09 14 January, 2002 Pat Tolan. D e a r M s. G a y n o r, W e a c k n o w le d g e y o u r le tte r o f 2 nd J a n u a ry w ith e n c lo s u re s . O u r c lie n t d id n o t re c e iv e th e s e p a p e rs u n til w e s e n t h im c o p ie s a n d w e h a v e n o w re c e iv e d in s tru c tio n s . W e tru s t th a t th e tim e lim it m e n tio n e d in th e I n s p e c to r’s le tte r o f 1 1th D e c e m b e r w ill b e e x te n d e d to re c e iv e th is le tte r o n b e h a lf o f o u r c lie n t. T h is is b y w a y o f a w ritte n re p ly to th e p re lim in a ry c o n c lu s io n th a t o u r c lie n t w a s a c lie n t o f A n s b a c h e r. O u r c lie n t d o e s n o t w is h to a v a il o f th e o p p o rtu n ity to c ro s s -e x a m in e M r. J a c k S ta k e lu m . T h e in s p e c to r ’s p re lim in a ry c o n c lu s io n is as fo llo w s :“M r. T o la n w a s a c lie n t o f A n s b a c h e r a lth o u g h h e w a s p ro b a b ly u n a w a re o f th a t fa c t. O u r c lie n t w is h e s to d is p u te th is p re lim in a ry c o n c lu s io n o n th e g ro u n d th a t fo r h im to b e a c lie n t o f A n s b a c h e r so m e fo rm o f re la tio n s h ip o f a c o n tra c tu a l n a tu re w o u ld h a v e h a d to e x is t b e tw e e n o u r c lie n t a n d A n sb a c h e r. N o s u c h re la tio n s h ip e x is te d . O u r c lie n t w a s n o t a w a re th a t a n y fu n d s o w n e d b y h im w e re d e p o s ite d w ith A n s b a c h e r a n d A n s b a c h e r w e re n o t a w a re th a t a n y fu n d s h e ld b y it b e lo n g e d to o u r c lie n t. T h e re is n o e v id e n c e o f a n y k in d th a t o u r c lie n t w a s a w a re o f a n y m o n e y b e lo n g in g to h im b e in g d e p o s ite d w ith A n s b a c h e r. T h e fa c t is th a t h e w a s n o t so a w a re . W e a w a it h e a rin g fro m y o u . PARTNERS : Peter O'Boyle, B.C.L., Terry O'Boyle, B.A. ASSISTANT: Donnacha O’Baoighill B.C.L. Vat No. F1292514B Appendix XV (164) Mr Neil McCann 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Neil McCann. a) Transcript of evidence of Mr Neil McCann dated 31 March 2000. b) Letter of 2 March 2000 - Mr Neil McCann to the Inspectors. c) Letter of 5 January 1973 - Kennedy Crowley & Co to Mr Vincent Walsh. d) Letter of 28 December 1972 - GMCT to Mr Neil McCann. e) Undated letter re Deed of Settlement - Mr Neil McCann to GMCT. f) Letter of 11 May 2000 - Mr Sean Mooney to Mr Michael Meghen. Correspondence received from or on behalf of Mr Neil McCann. a) Letter o f 21 December 2001 - Arthur Cox Solicitors to the Inspectors. b) Letter and statement of 21 December 2001 - Mr Neil McCann to the Inspectors. c) letter of 21 December 2001 - Mr Alex Bums to Mr Michael Meghan. UNDER OATH ON FRIDAY, 31ST MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. NEIL McCANN Represented by: MR. DAN O'KEEFE SC Instructed by: MR. MICHAEL MEGHEN ARTHUR COX EARLSFORT CENTRE EARLSFORT TERRACE DUBLIN 2 WITNESS MR. N. McCANN EXAMINATION MR. JUSTICE COSTELLO MS. MR. PAGE 6 - 62 MACKEY 63 - 69 JUSTICE COSTELLO 70 - 73 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr McCann, we will start o u r i n t e r v i e w now. 6 M R . McCANN: Yes . 7 MR. I am Declan Costello and JUSTICE COSTELLO: o n m y r i g h t is Ms. M a c k e y . 8 9 10 M R . McCANN: Yes . MR. We are tw o of the JUSTICE COSTELLO: Inspectors that have been 11 12 appointed by The High C o u r t . 13 M R . McCANN: Yes . 14 MR. What JUSTICE COSTELLO: I e x p l a i n to p e o p l e w h o c o m e f o r i n t e r v i e w is 15 16 t h i s t h a t t h i s is n o t a C o u r t . 17 M R .McCANN: Yes, 18 MR. J U S T I C E C O S T E L L O : It is n o t a T r i b u n a l . 19 M R .McCANN: Yes . 20 MR. J U S T I C E C O S T E L L O : It is a n i n t e r v i e w . 21 M R .McCANN: Right. 22 MR. J U S T I C E C O S T E L L O : If d u r i n g t h e c o u r s e of 23 right. t h i s i n t e r v i e w y o u w a n t to 24 consult with your counsel or solicitor please tell 25 me and I will 26 c o u l d d o so. 27 M R . McCANN: stop asking you questions and you Right. 28 A n d if d u r i n g t h e 29 i n t e r v i e w y o u r c o u n s e l or 1 2 MR. McCANN: Right. 3 MR. JUSTICE COSTELLO: They can indicate this to me and we will stop the 4 5 questions and then you can consult with your legal 6 advisors. 7 MR. McCANN: Thank you very much. 8 MR. JUSTICE COSTELLO: Mr. McCann, this 9 interview, as you know, is 10 under oath and I would ask now Ms. Cummins, our 11 solicitor, to administer the oath to you. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. McCann, I think we could best start if you 6 give us a bit of background? 7 A. 8 2 Q. 9 A. 10 3 Q. 11 A. 12 4 Q. Yes. To yourself? Yes. And to the company Fruit Importers Ireland Limited? Yes. And what members of your family were involved in 13 that and how the shares were held. 14 give me general background information? 15 A. Sure. Could you just Well, my father and brother died within two 16 years of each other back in 1952 and 1954 and I ran 17 then -- I took over the running of the company, 18 which was a family company operated out of Dundalk. 19 5 Q. 20 A. Yes? And then through the years, moving through the 1950s 21 into the 1960s, the company started to grow somewhat 22 and we moved into Dublin to establish a brokerage 23 business and partnership there with a North of 24 Ireland firm. 25 developed. 26 growing until finally we came into the 1980s and at 27 that stage, in the early 1980s, the company merged 28 with D.C.C., and also went public, I think, a year 29 ot two afterwards. Through the 1960s, you know, that In the 1970s we kept on, you know 1 6 Q 2 A And probably in those early 1980s, you know, one of 3 my sons came into the business as Finance Director. 4 In 1986 we bought the UK company, which was Fyffes. 5 As I say we acquired that company and eventually we 6 changed the name of what had been FII -- the 7 company I think was changed from McCann to 8 Tormey Brothers & McCann then to FII. 9 from FII to Fyffes. It went then Fyffes was a pretty substantial 10 public company -- well, by our standards pretty 11 substantial. 12 7 Q 13 A Yes ? Then another son then came in. He was a solicitor 14 and he came in, I think, in 1988 or 1987 and that 15 leaves us where we are today. 16 8 Q 17 18 Mr. McCann, was it the same company all these years or was a separate company incorporated called FII? A I think FII was incorporated separately, yes, and it 19 acquired Tormey Brothers & McCann, which was the 20 partnership and then...(INTERJECTION). 21 9 Q 22 A 23 10 Q Yes. I ... (INTERJECTION)? Sorry? Sorry, Mr. McCann I just want to get the technical 24 details. 25 your father died? The business that you carried on after 26 A 27 11 Q Was that a Limited company? 28 A That was a Limited company. 29 12 Q Yes . 1 2 13 Q 3 A 4 14 Q 5 6 Limited? Yes . Yes. Was it in 1968 that FII was incorporated as a new company? A I am just not sure. I knew we had been inviting in 7 various people and we said -- it was about that 8 time. 9 15 Q 10 However, am I right in saying that a new company was formed called...(INTERJECTION)? 11 A 12 16 Q I am sorry, Justice. Yes . MR. MEGHEN: 13 14 Judge, my understanding is that the new company was 15 formed at the time of the D.C.C., investment, which 16 was in either 1979 or 1980. 17 MR. JUSTICE COSTELLO: Yes. 18 MR. MEGHEN: And that the business and 19 assets of the former 20 companies. 21 MR. JUSTICE COSTELLO: That is...(INTERJECTION) 22 MR. MEGHEN: Were transferred. MR. JUSTICE COSTELLO: Sorry, I may have been -­ 23 17 Q 24 I may have misunderstood 25 some of the documents, Mr. McCann? 26 A 27 18 Q Yes . I understood that a new company was formed in 1968 28 called Fruit Importers Ireland Limited, am I wrong 29 in that? 1 2 19 Q. 3 A. Well... (INTERJECTION)? I think you are right. I am not just sure of the 4 years and that FII lived until -- it lived until the 5 beginning of the 1980s and then there was a new 6 company formed. 7 20 Q. 8 9 Yes. I will come to that later. Really what I am concerned at the moment is...(INTERJECTION)? A. 10 I think you are right. I am sorry I should know that. 11 21 Q. 12 A. 13 22 Q. 14 A. 15 23 Q. 16 With FII? Yes. Yes? I think I can find that out, you know, very quickly. If you look at page 3 of your statement to us (Same Handed) 17 A. 18 24 Q. 19 (Exhibit 1)? Yes, you are very good. Do you see part "B"? You say there: "Fyffes pic is an Irish publicly quoted company"? 20 21 A. 22 25 Q. Yes. "I control approximately 10% of Fyffes pic. Fyffes pic was incorporated in 1980 and acquired the fruit distribution business previously carried on by another Irish company Fruit Importers of Ireland Limited which was incorporated in 1968"? 23 24 25 26 27 28 29 A. I think that the piece about, you know, "Fruit Importers of Ireland Limited incorporated in 1968," 1 2 26 Q. 3 A. 4 2 7 Q. 5 A. 6 28 Q. That is really all I am concerned about? Well, that is accurate. At the moment? I believe. Yes. Presumably then this was incorporated and took 7 over the business which had been previously carried 8 on by Charles McCann Limited? 9 A. 10 29 Q. 11 A. 12 30 Q. Yes, which had spread over the years. Of course? Yes, yes. What I am concerned to know is, in 1968, who held 13 the shares in the company Fruit Importers of Ireland 14 limited? 15 A. 16 31 Q. 17 A. 18 32 Q. 19 A. 20 Just generally? Okay, the general way...(INTERJECTION). Approximately? Well, I controlled I think -- I certainly controlled the majority of the shares. 21 33 Q. 22 A. 23 34 Q. 24 A. 25 Yes? Through my own holding and family trusts. Yes? Which were being done around that time I think. They were done through The Bank Of Ireland. 26 35 Q. 27 A. Yes? But it was more than 50%. It was probably in the order of sixty something per cent. 28 29 Right. 36 Q. Yes. Who else was in the company then? 1 A. Well, then there were a number of people in the 2 company. 3 country and there were people in the market there 4 who had been invited to participate and they took 5 shares in the company. There were family companies around the 6 37 Q. 7 A. I was a major shareholder. 8 38 Q. Had you...(INTERJECTION)? 9 A. 10 39 Q. 11 A. 12 40 Q. 13 A. 15 41 Q. 16 A. 17 42 Q. 18 A. 19 43 Q. 20 Your trusts? Yes. We held the other shares then, the other 40% Yes. Divided up amongst a number of different people? A number of different people. Yes? Some big and some small. Small, yes. I see. Did you have any brothers or sisters in the company? 21 A. 22 44 Q. 23 A. 24 45 Q. 25 A. 26 4 6 Q. 27 29 My ownself or my trusts. approximately? 14 28 You were the major shareholder? No. At that stage? No, no. It was mainly controlled then by yourself? Yes. And then later your sons came in and we can deal with that later? A. Yes. 1 2 3 48 Q. 4 A. 5 49 Q. 6 A. Yes? Which the Managing Partner was Jack Story. Yes? And they continued as the accountants from the 7 foundation until right into after the deal was done 8 with Fyffes. 9 50 Q. 10 A. 11 51 Q. 12 A. 13 52 Q. 14 A. 15 53 Q. 16 Yes. That would be in the 1980s? In the 1980s. Yes? And then they were acquired by SKC. Yes. Story & Phelan were acquired? Story & Phelan. Story & Phelan were your accountants then, the firm's accountants? 17 A. 18 54 Q. 19 A. 20 55 Q. They were the auditors, yes. And auditors, yes? Yes. Did you have a personal accountant yourself looking 21 after your own personal affairs or did they look 22 after your affairs as well? 23 A. 24 56 Q. 25 A. 27 57 Q. 29 Yes. You would have an association with SKC then for a very long time? 26 28 I think SKC were the personal accountants. For a long time. Yes. Did you have a solicitor then, a personal solicitor, who looked after your own affairs? 1 58 Q 2 A 3 I had a firm in Dundalk called Daniel O'Connell & Son. 4 59 Q 5 A 6 60 Q 7 A Yes ? The principal was Peter O'Connell. Yes? And then in Dublin we had Coxs and we operated 8 mostly with Denis Bergin and at a later stage with 9 Mr. Michael Meghen. 10 61 Q Yes. I want to come to your meeting in 11 Guinness & Mahon, your first association with them. 12 When did you first become associated with 13 Guinness & Mahon? 14 A I think it was at a time in the 1960s that we were 15 trying to buy a company called The Tropical Fruit 16 Company and Guinness & Mahon were acting for them, 17 and we more or less thought we had negotiated a deal 18 but it fell through, and the person at that stage 19 was a man called William Forwood. 20 62 Q 21 A 22 63 Q 23 24 Yes. That is when you first met them? I believe so. When did you first start then to enter into a client relationship with them? A Again, I am fairly certain but I will just say I 25 think or I believe, I think it was the time of the 26 first bank strike. 27 64 Q 28 A 29 Yes? And they stayed open during the bank strike and they gave, you know, a very good services. 1 65 Q 2 A I met Mr. Traynor, I would say maybe seven or eight 3 times over the years, just to shake hands and say 4 hello. 5 66 Q 6 A 7 67 Q 8 A 9 Who then was your main contact in Guinness & Mahon? The main contact would have been Maurice O'Kelly. Yes? And then it kind of varied. In the early stages it was certainly Maurice O'Kelly. 10 68 Q 11 A 12 69 Q 13 A 14 70 Q 15 A Yes ? Whom I got to know very well. Yes ? And then at a later stage also Martin Keane. Yes? And then there were a few names, one was a chap in 16 the Foreign Exchange Department with whom I had a 17 fair few dealings called Scully. 18 71 Q 19 A 20 72 Q 22 A 23 73 Q 24 Did you meet Mr. Collery at all? No. Mr. Traynor then you would have only met over the years a number of times, a few times? A I don't think I ever had a full conversation with him. 26 27 But that was very much a phone business and that was about i t . 21 25 Yes ? 74 Q Yes. Mr. McCann, if Stokes Kennedy Crowley then 28 were looking after your own personal affairs, in 29 relation to the matters that you referred to about 1 2 Yes . 3 75 Q 4 A 5 76 Q And the steps that were then taken? Sure . In relation to tax avoidance schemes that were being 6 operated, that was on the advice of Stokes Kennedy 7 Crowley? 8 A 9 10 believe. 77 Q 11 12 That was on the advice of Stokes Kennedy Crowley I Yes. Who in Stokes Kennedy Crowley were you discussing these affairs with? A Now, the involved people there I believe were 13 Alex Spain at some stage and John Callaghan at 14 another stage. 15 78 Q 16 A 17 Yes? And maybe, you know, various people at a lower level but I believe it was Alex Spain and John Callaghan. 18 79 Q 19 A 20 80 Q 21 A 22 What about Mr. Reid, Mr. Don Reid? Mr. Reid, sorry, Mr. Don Reid, yes. Yes? It wasn't very much with him but I do know that he appeared at some stage. 23 81 Q 24 A Yes ? Just, I should also say, that at that time I mean I 25 was a kind of a hands on person dealing with all 26 aspects of the business. 27 82 Q 28 A 29 Yes? And I wasn't familiar with what was happening in wherever, in Bermuda, and eventually Paris and so 1 on. 2 really, you know in the driving seat, as it were, 3 because I was running all the rest of the business. 4 We were growing and there was, you know -- people 5 were working terribly hard and so on. 6 83 Q. 7 A. 8 Yes? But in any event I have gleaned a lot in the last few months of what, you know, was happening. 9 84 Q. 10 A. 11 85 Q. 12 13 I was probably kept in the picture but I wasn't Did...(INTERJECTION)? I wasn't entirely in the dark either. Did you go into Stokes Kennedy Crowley and see Mr. Spain and Mr. Reid? A. I see a reference in these papers here, it was 14 suggesting having a meeting with myself and then I 15 saw another -- I think there was -- one of the 16 letters was copied to me. 17 letter was copied to me but I notice the following 18 letters 19 were not copied to me. 20 86 Q. 21 A. 22 23 -- sorry, pardon me. The following letters Yes? As I say I am familiar now with what had been happening. 87 Q. 24 I see a reference in the correspondance to a Ms. Spain? 25 A. 26 88 Q. 27 A. 28 89 Q. 29 I think Alex Spain's Yes. Who is your Financial Director? Yes. Was she then related to Alex Spain? 1 90 Q 2 A 3 91 Q 4 She is a qualified accountant. Would she have been involved, do you think, with Mr. Alex Spain in these arrangements? 5 A 6 92 Q Yes? 7 A Yes. 8 93 Q Yes? 9 A 10 11 She was involved, yes. She was a very competent lady. And a very what would you say, you know, meticulous and a person of the highest integrity. 94 Q Then she would have been a person that would have 12 been involved then in these tax planning proposals 13 that were being discussed? 14 A 15 95 Q 16 A 17 96 Q 18 A Yes . Yes? Yes . Perhaps, more than you were? I would say more than I was but having said that I 19 mean the responsibility would clearly have been 20 mine . 21 97 Q 22 23 Ms. Spain is she alive? Is she able to give evidence? A She is alive. Well, if you ask me that question I 24 would say there is a question mark. 25 that stage was under an awful lot of pressure 26 because she was a very scrupulous person and she was 27 overwhelmed with work and I think I was at fault for 28 that but in 1979 or that period, 1979/1980, she was 29 quite ill and it was on and off. 17 Ms. Spain at I mean I assume -­ 1 2 98 Q 3 A 4 99 Q 5 A 6 100 Q 7 A 8 Yes, or course? Yes . This is absolutely confidential? Right, yes. Yes? Well, anyway she had severe bouts of depression at that stage. 9 101 Q 10 A Yes ? And eventually I think in 1979/1980 she had a long 11 period in hospital. 12 for a while but eventually she retired early in 1982 13 or 1983 or thereabouts. 14 102 Q 15 A She came back to the business I am not sure about dates. Yes? But she had a very bad time and probably the 16 pressures of mergers and public companies, off shore 17 accounts and, you know, maybe lack of consideration 18 on my part in not providing her with proper people 19 and that to back her up, but she was very much 20 involved. 21 103 Q 22 She was involved then but, you say, she retired early? 23 A 24 104 Q 25 A 26 105 Q 27 A 28 106 Q 29 A Yes . She went into ill health? Yes . And she retired early then? Yes . Had she been out of the business ever since? 1 2 107 Q. 3 A. Yes? She has been out of the business since except that 4 she does some little bit. 5 retired but she takes care at the same time. 6 108 Q. 7 I mean she is officially Did you consider asking her about this question of this trust, that we will come to now in a moment? 8 A. 9 109 Q. 10 A. 11 Yes. And your letter concerning it? At first I was very nervous of speaking to her at all in case I might trigger off a repeat. 12 110 Q. 13 A. 14 111 Q. 15 A. 16 Yes? Or a return of the illness. Yes? But some of the other people in our place have spoken to her. 17 112 Q. 18 A. 19 113 Q. 20 A. 21 114 Q. 22 A. 23 115 Q. 24 A. 25 116 Q. Yes? I have spoken to her. Yes? But in a very limited way. Yes? I gather that she has a fairly clear picture. I see? Of what went on. Yes. I would like to come to this letter that you 26 wrote to the Cayman company. 27 documents 28 A. 29 117 Q. (Exhibit 2) You are marvelous. It is page 26 of our (Same Handed)? Thank you very much. Yes. Was that your personal, your private, address, 1 "Miltown Grange, Castlebellingham"? 2 Yes . 3 118 Q 4 5 The copy of the letter that we have is undated. Can you explain that? A 6 I can't. In fact I can't explain anything about this letter. 7 119 Q 8 A 9 120 Q I will come to that in a moment, Mr. McCann? Sorry. However, I am just wondering -- we have been given, 10 we all presume, a photocopy and it seems to be a 11 photocopy of a copy of a letter. 12 now whether the original copy is undated or not? 13 A 14 121 Q 15 A 16 122 Q 17 A 18 123 Q 19 However, do you Yes, undated. It is undated? Undated. The document you got was undated? Yes . Before we go into this document I want you to tell me how you came across this document? 20 A 21 124 Q 22 A 23 125 Q 24 A Well, when I got the letter from yourselves. Yes? About the enquiry. Yes ? I was staggered. Anyway having said that we 25 immediately appointed a team of three people, the 26 Finance Director Mr. Gernon and Mrs. Ghose, who 27 manages my personal affairs and also she is a 28 Taxation Manager for the company, and also a man 29 called John Hennessy, who was a partner in Arthur 1 Anderson and is now practicing at the Bar. 2 have done very little else for the last two months 3 but try and get, try and build, up the information 4 on what went on over these years. 5 126 Q 6 A They Yes ? And it is a lot of work and I must say that most of 7 the people that we approached were more than helpful 8 in making files available and any information. 9 127 Q 10 A 11 12 Yes ? And I think, trawling through the SKC files, they found this letter (Exhibit 2). 128 Q 13 Yes. When you say "they" do you mean either Mr. Gernon, Mrs. Ghose or Mr. Hennessy? 14 A 15 129 Q 16 A 17 130 Q 18 Yes . They found the letter? Yes, in SKC. You must have contacted Stokes Kennedy Crowley to ask permission? 19 A 20 131 Q 21 A We did. Who did you contact in Stokes Kennedy Crowley? I just don't know that, who was contacted, but I 22 know at various -- I spoke to Alex Spain myself at 23 some stage. 24 132 Q 25 A 26 133 Q 27 A Yes ? I spoke to Don Reid at another stage. Yes? And I gather that some members of that team, maybe 28 Mrs. Ghose, who had worked for years in SKC, 29 approached other people -- Don Reid and Alex Spain 1 have left the company or the partnership at this 2 stage. 3 134 Q. 4 A. Yes? And also John Callaghan but various members of 5 that group spoke to those other people. 6 Mr. Sean Mooney as well. 7 135 Q. 8 A. 9 136 Q. 10 I spoke to Who is Mr. Mooney? Mr. Mooney is the taxation man in SKC. I am just wondering, SKC must have searched their files ? 11 A. 12 137 Q. 13 A. 14 138 Q. 15 A. 16 139 Q. Yes. Their records? Sure. For documents? Yes. I am just wondering who in SKC would have done this? 17 Who would have undertaken this task? 18 touch with the Managing Partner of SKC or who were 19 you in touch with do you know? 20 A. 21 Well, I know I was in touch with, as I say, Alex Spain. 22 140 Q. 23 A. 24 141 Q. 25 A. 26 142 Q. 27 A. 28 143 Q. 29 Were you in However, they are retired now? Yes, they are retired. Yes? I was also in touch with Sean Murphy. What... (INTERJECTION)? And he would have made approaches to other members. Yes? 1 144 Q 2 A 3 145 Q 4 A 5 146 Q 6 A 7 147 Q 8 A 9 148 Q 12 A 13 149 Q 14 A Has been given to you? Yes . Were you given any other letters? I think other letters, I mean of the dealings with Yes ? That our people deemed pertinent. Were you given any correspondance that SKC may have I think if that had been there it would have -­ sorry, with Cayman. 17 150 Q 18 A 19 151 Q 20 A 21 Yes ? Anything we got from...(INTERJECTION). Can you remember now, Mr. McCann? No, no. I can tell you that whatever we got from SKC has been sent to you. 152 Q 23 I wonder is that right? I mean have you given us every piece of paper that SKC gave you? A 25 Everything -- I will put it another way, everything that we deemed was part of your requirement here. 26 153 Q 27 A 28 154 Q 29 Sure . had with Cayman? 16 24 Then as a result of this one letter? was nothing pertinent. 11 22 Yes. ourselves and SKC, were available to us but there 10 15 Who opened the file. Yes. What I am concerned about? Yes . Is that we have no correspondence that Stokes Kennedy Crowley may have had with 1 2 3 Sure . 155 Q 4 It would seem to me very likely that such correspondence must have taken place? 5 A 6 156 Q 7 A 8 157 Q 9 A 10 158 Q Yes ? 11 A Yes . 12 159 Q 13 A 14 160 Q Well, you know, it may be. I don't know. Yes? Yes . I take it Mr. McCann you can make enquiries? Absolutely. This is the only document then (Exhibit 2)? Yes . That you have been given by Stokes Kennedy Crowley 15 that they have been able to find in relation to a 16 possible trust? 17 A 18 161 Q 19 A 20 162 Q 21 A 22 163 Q 23 A 24 164 Q 25 A 26 165 Q Sure . Yes ? I believe that is absolutely correct. It appears to be your address on the top of it? Sure . It is not a Stokes Kennedy Crowley letter? Right. It is in their possession? Yes . Did you keep any correspondence in your home in 27 relation to your financial matters? 28 I think not really. 29 would have stuff at home and that. I mean from time to time I I might have 1 2 166 Q. 3 A. 4 167 Q. Did you? No, the answer is no. If a trust or something like that had been created, 5 in which you personally were involved, you would not 6 have kept the documents? 7 with your accountant. 8 dealt with them? 9 A. 10 168 Q. 11 A. 12 Well, no. You would have left them The accountant would have I kept fairly good files in the office. Yes? Now, they mightn't be very sophisticated but I would have kept most important things. 13 169 Q. Yes. 14 A. Yes. 15 170 Q. 16 A. 17 171 Q. 18 A. Your own personal affairs? Have you looked...(INTERJECTION)? I have always -- sorry? Sorry? I was going to say I have always -- I have had the 19 benefit for over 30 years of having a qualified 20 person's service available to manage the things. 21 172 Q. 22 A. 23 173 Q. 24 25 Absolutely, I have been through files up and down. Have you any files going back to the period, to the early 1970s? A. There are bits and pieces of things but there is certainly nothing with this thing here. 26 27 174 Q. 28 A. 29 Have you looked in your own personal files? Yes. And, you know, while there might have been so many things happening at various stages, you know, with 1 acquisitions of companies and developing and so on, 2 that I wouldn't remember a connection with the 3 company. 4 175 Q. 5 A. Yes? But the idea of setting up anything apart from 6 The Bank Of Ireland trusts, you know, on the local, 7 on the Irish, scene, I -- okay, you can't remember 8 so many things but I think I would remember that to 9 do with the family. 10 176 Q. 11 A. 12 177 Q. 13 A. 14 178 Q. 15 The Bank of Ireland set up trusts for you? Yes. Were these discretionary trusts? Yes. You were familiar with the concept of discretionary trusts ? 16 A. 17 179 Q. 18 A. 19 Yes. Yes? I wasn't familiar with all the different companies they have on the chart coming down. 20 180 Q. 21 A. 22 181 Q. Yes? But I was...(INTERJECTION). However, you were familiar with the concept of 23 discretionary trust, that the trustees have a 24 discretion? 25 A. 26 182 Q. 27 A. 28 183 Q. 29 Sure. To give the benefit? Yes. That they are in? 1 184 Q. 2 A. 3 185 Q. 4 A. 5 186 Q. 6 The funds in the trust to a group of people? Absolutely. And have a discretion? Yes. Are you familiar with the concept of a letter of wishes ? 7 A. 8 187 Q. 9 A. 10 188 Q. 11 A. 12 189 Q. Yes. That the Settlor? Yes. Would give a letter of wishes? Yes. And that in the normal course of events the Settlor 13 would expect the trustees to comply with the Letter 14 of Wishes? 15 A. 16 190 Q. 17 A. 18 191 Q. Absolutely, yes. You are familiar with that concept? Yes, yes. Would you just take the letter for a moment here. 19 Do you see that it is addressed to the Directors of 20 Guinness Mahon Cayman Trust Limited, with an address 21 in the West Indies? 22 A. 23 192 Q. 24 A. 25 193 Q. Yes. Did you know about Guinness Mahon Cayman Trust? No, I wasn't familiar with that at all. Perhaps I did not put the question properly or 26 fairly to you, because you did become familiar with 27 Guinness Mahon Cayman Trust Limited, did you not, in 28 relation to the scheme with Paris Investment? 29 1 years, and trying to go back to those years in my 2 mind, I had no knowledge of Guinness Mahon Cayman 3 Trust. 4 to be done. 5 Bermuda and afterwards something in Cayman but I had 6 no -- I wouldn't have known the refinement of 7 Guinness Mahon Cayman or whatever the different 8 names of that company was. 9 194 Q I had no knowledge of the detail of what was I knew we were doing something in Did you not know, in fact you told us in your 10 statement, that Guinness Mahon Cayman Trust Limited 11 owned the shares in Paris Investment's? 12 A 13 195 Q 14 May I look at this? Sure, yes. If you look at page 4 of your statement? Have you got page 4 of your statement 15 A 16 196 Q 17 A 18 197 Q 19 (Exhibit 1)? Yes . Yes. Do you see Fruit Importers...(INTERJECTION)? On this, yes, sorry. Do you see Fruit Importers of Ireland Limited? You see the second paragraph: 20 "The company held the shares in Paris Investments Limited in trust for the shareholders of FII"? 21 22 23 A 24 198 Q Is that right? 25 A Yes, I follow. 26 199 Q Yes, the company. What I am pointing out to you Mr. McCann is that you 27 must have been aware of the existence of this Cayman 28 company, Guinness Mahon Cayman Trust Limited? 29 A 1 2 from FII, you know, down to Paris, and then I have 3 Cayman marked outside here as 4 being...(INTERJECTION). 5 200 Q 6 A 7 201 Q 8 Look...(INTERJECTION)? Of the Cayman company, yes. Yes. If you look at the very beginning? Turn to the very first page of your letter? 9 A 10 202 Q Yes, yes. "As requested I set out below a statement of all of my dealings whether direct or indirect with Ansbacher (Cayman) Limited formerly known as Guinness Mahon Cayman Trust Limited, Ansbacher Limited and Cayman International Bank and Trust Company Limited (the Company)." 11 12 13 14 15 16 In your letter the company is referred to? 17 A 18 203 Q 19 A 20 204 Q 21 A 23 205 Q 24 A 26 206 Q 29 Yes . Or in those days it was known as Guinness Mahon Right, yes. I think I have lost my way, Justice. What I am coming back to, if you come back to page 4 (Exhibit 1)? 25 28 As to what we have been calling "Ansbacher"? Cayman Trust? 22 27 Referred to. Yes . Under "Fruit Importers Of Ireland Limited" it says: "The company held the shares in Paris Investments Limited in trust for the shareholders of FII"? 1 2 207 Q. What I am asking you Mr. McCann is: Does it not 3 appear that you must have been aware of the 4 existence of Guinness Mahon Cayman Trust at the time 5 that this tax planning was undertaken? 6 A. No, because my memory going back to all of this is 7 that I was not familiar with those things but I have 8 become familiar with them in the trawling that has 9 gone on. 10 208 Q. 11 A. Yes? But at that stage it was just very much a thing of 12 we were doing something with Bermuda and at a later 13 stage we were doing something with Cayman, and I 14 think the knowledge that it was Paris or whatever, 15 or IFS and what have you. 16 209 Q. 17 A. 18 210 Q. 19 A. 20 211 Q. 21 Did you...(INTERJECTION)? That is recent for me. Yes? Recent knowledge. Very well. However, when you say you were doing something in Bermuda and doing something in Cayman? 22 A. 23 212 Q. Yes. Do you mean that you were moving funds there and 24 they were involved in the tax planning that was 25 being undertaken? 26 A. 27 213 Q. 28 29 Yes, absolutely. Did you know that you were doing something in Cayman with a subsidiary of Guinness & Mahon in Dublin? 1 2 214 Q. 3 A. 4 215 Q. 6 A. 7 What do you mean that they were involved? Well, they were either advising or helping to advise maybe SKC. 216 Q. 9 Did you not know that, in fact, you were transferring funds or getting involved with a 10 company in the Cayman Islands? 11 A. 12 217 Q. Sure. Which was a subsidiary of Guinness Mahon in Ireland, in Dublin? 13 14 But as regards the details of it at that time I didn't know. 5 8 Yes? A. Well, I am not so sure of that because I was sure of 15 the fact that SKC, in whom we had the utmost 16 confidence, and possibly to a lesser extent 17 Guinness Mahon, were helping to set up something. 18 218 Q. 19 A. 20 219 Q. In the Cayman? 21 A. In the Cayman. 22 220 Q. 23 A. 24 221 Q. 25 A. 26 Yes? To do with off shore business in...(INTERJECTION). Yes? Yes. Well... (INTERJECTION)? But beyond that I wouldn't have known a name or a detail about it. 27 222 Q. 28 A. 29 223 Q. You must have known the amounts of funds? No. That were transferred, did you? 1 2 224 Q 3 A I i m a g i n e at s o m e s t a g e as t h e cash, y o u know, would 4 have come through, 5 through, 6 t h r o u g h t h e FII c o m p a n y a c c o u n t s . 7 b e e n s o m e t h i n g t h e r e f o r m e to se e b u t n o n e o f t h a t 8 registers. 9 22 5 Q 10 A 11 226 Q Now, or as t h i n g s w o u l d h a v e c o m e there might have been information passing is t h a t it? It r e g i s t e r s n o w b e c a u s e Yes. There would have However, I h a v e b e e n t h r o u g h it all. you had forgotten, u ntil this was b r o u g h t to y o u r m e m o r y yo u h a d f o r g o t t e n ? 12 13 A 14 227 Q 15 Yes. I m e a n it w a s q u i t e a s h o c k t h a t t h i s c a m e in. V e r y go od. Yes. L e t u s l o o k at t h i s i n s o m e detail? 16 A 17 228 Q 18 A 19 229 Q Yes . It is a l e t t e r a d d r e s s e d t o t h e c o m p a n y i n C a y m a n ? I a m sor r y . Yes, yes, so r r y , yes. You say that you now know about the Guinness Mahon 20 Cayman Trust Limited. 21 you w r o te the letter, 22 have then known the address or a l t e r n a t i v e l y that 23 this letter was d r a f t e d b y someone for your 24 signature, 25 have known the address? 26 A 27 23 0 Q Yes? 28 A This 29 Justice, D o e s it n o t a p p e a r t h a t if this letter, that you would a n d t h a t t h e p e r s o n w h o d r a f t e d it w o u l d c a n I s a y to y o u v e r y c l e a r l y . l e t t e r is a b s o l u t e l y n e w s t o me, it c a m e b a c k f r o m t h e f i l e s o f SKC. from the day 1 2 A n d nothing that 3 make me think otherwise. 4 232 Q 5 I h a v e b e e n t o l d s i n c e h e l p s to L e t us j u s t l o o k at t h e t e r m s o f t h e l e t t e r (Exhibit 2 )? 6 A 7 23 3 Q Yes . It re a d s : "I r e f e r to a D e e d o f S e t t l e m e n t d a t e d 3 1 s t M a r c h , 1972, w h e r e b y J o h n A n d r e w Furze appointed Guinness and Mahon C a y m a n T r u s t L i m i t e d as T r u s t e e s of a Se t t l e m e n t for the b e n e f i t of the issue of the late Charles M c C a n n and Rosetta McCann." 8 9 10 11 12 T hey are your father and m o t h e r ? 13 14 A 15 234 Q 16 A 17 23 5 Q 18 A Yes, yes. It r e f e r s to a D e e d of S e t t l e m e n t o f t h e 3 1 s t M a r c h ? Yes . Have you made enquiries about this? Absolutely, a n d I h a v e s p o k e n p a r t i c u l a r l y to t h e 19 p e o p l e at S K C a n d t h e v i e w -- t h e r e is a v i e w t h e r e 20 t h a t Mr. M o o n e y w o u l d s a y h e v a g u e l y r e m e m b e r s 21 s o m e t h i n g a b o u t t h a t b u t h e s a y s i f he d i d a n d if 22 there was 23 implemented. such a thing being m o o t e d 24 236 Q Mr. Mooney? 25 A Mr. Mooney. 26 237 Q Mr. M o o n e y is S e a n M o o n e y , 27 A Mr. Sean Mooney. 28 238 Q 29 A You have mentioned? it n e v e r w a s is t h a t r i g h t ? 1 239 Q 2 A 3 24 0 Q 4 A He m u s t h a v e b e e n , Yes. yes. W h a t a b o u t Mr. A l e x S p a i n ? A l e x Spain was very much involved. I see f r o m the 5 co r r e s p o n d e n c e was ver y m u c h i n v o l v e d e a r l y on but 6 t h i n k a f t e r that he k i n d of w e n t off the scene. 7 24 1 Q 8 A 9 242 Q 10 A 11 24 3 Q 12 A 13 D i d yo u as k h i m d i d he r e m e m b e r a n y t h i n g a b out t h is? Well, when I saw Alex Spain I hadn't s e e n th i s . So y o u h a v e n o t a s k e d h i m s i n c e ? No. Yes ? B u t h e s a i d t o m e at t h a t st a g e , "Look, I can r e m e m b e r n o t h i n g a b o u t w h a t w e n t o n at t h e t i m e . " 14 244 Q 15 A Yes? "I d o k n o w w e s e t u p t r u s t s , " h e said, "i n B e r m u d a 16 a n d C a y m a n u n t i l t h e y w e r e n o l o n g e r l e g a l or 17 l e g i t i m a t e ." 18 24 5 Q 19 A He t o l d h e t h a t t h e y d i d se t u p t r u s t s ? This was for, yes, in a c c o r d a n c e w i t h t h a t l e t t e r . 20 Y o u k n o w t h e l e t t e r t h a t c a m e i n r e c e n t l y t o you, 21 the mo s t r ecent letter? 22 246 Q 23 24 Mr. S p a i n t o l d y o u t h a t h e h a d se t u p t r u s t s u n t i l they became illegal? A 25 I a m s o r r y I p u t it t h e w r o n g way. companies 26 247 Q 27 A 28 248 Q 29 A I in C a y m a n , H e s e t up in B e r m u d a a n d C a y m a n . You have not shown him this letter ( E x h i b i t 2 )? No. H a v e y o u s h o w n t h i s t o D o n Reid , this letter? 1 249 Q 2 A 3 25 0 Q 4 A No. Yes ? And I had certainly a very serious discussion with 5 Mr. 6 is a n y w a y f a m i l i a r t o h i m b u t . . . ( I N T E R J E C T I O N ) . 7 25 1 Q M o o n e y a n d he is t h e o n l y o n e t h a t s a y s t h a t it Y o u se e I s h o u l d e x p l a i n to y o u Mr. you may n o t k n o w it, b u t w h a t is s a i d i n t h i s l e t t e r ? 8 9 A 10 252 Q Yes . H a s be e n , o n t h e i n f o r m a t i o n w e h a v e got, quite a co m m o n w a y of se t t i n g up t rusts? 11 12 A 13 25 3 Q 14 Sure . W h i c h S t o k e s K e n n e d y C r o w l e y w e r e e n g a g e d i n at t h i s stage? 15 A 16 254 Q 17 Right. It s e e m s t o m i r r o r e x a c t l y w h a t t h e y d i d i n o t h e r cases that we have come across? 18 A 19 25 5 Q Sure, What I h e a r you. I a m w o n d e r i n g is w h o c o u l d h e l p us i f y o u r m e m o r y is s u c h t h a t y o u d o n o t r e m e m b e r t h i s ? 20 21 A 22 256 Q 23 Right. W h o c ould help us? Y o u t h i n k Mr. Mooney could h e l p us ? 24 A 25 257 Q 26 A I t h i n k Mr. M o o n e y c o u l d he l p . D o y o u t h i n k Mr. Yes, S p a i n c o u l d h e l p us? b u t I b e l i e v e a b s o l u t e l y -- I b e l i e v e t h a t no 27 t r u s t o f a n y k i n d of t h a t n a t u r e w a s 28 a n y t h i n g c a m e i n t o it o r o u t o f it. 29 McCann, 258 Q Yes? fo r m e d or that 1 A n d I don't think, 2 the family. 3 259 Q 4 A 5 26 0 Q t h e r e is a f e w t h i n g s t o do w i t h Yes ? T h a t I c o u l d b e m i s t a k e n i n that . If w e j u s t l o o k at t h e l e t t e r (Exhibit 2)? It g o e s on: 6 7 "I n t h e i r c a p a c i t y as T r u s t e e s , Guinness & M ahon Cayman Trust Limited, t h r o u g h t heir n o m inees own the entire issued share capital of Blue L i m ited"? 8 9 10 A 11 26 1 Q Yes . T h e l e t t e r g o e s o n then: "I h e r e b y a u t h o r i s e y o u to t r a n s f e r at p a r to N e i l C o l l i n s o r h i s n o m i n e e t h e e n t i r e i s s u e d s h a r e c a p i t a l of B l u e L i m i t e d ." 12 13 14 15 A 16 262 Q 17 A 18 26 3 Q 19 A Yes . Do you know who Neil C o l l i n s ? I know Neil Collins, W h o is h e ? Neil Collins 20 C o rk , 21 business 22 264 Q 23 A yes. is -- wel l, h e is a n i n d i v i d u a l in a b u s i n e s s m a n in Cork, w h o w a s v e r y a c t i v e in s o m e y e a r s ago. Yes? T h e r e a s o n w h y h i s n a m e is p e r h a p s -- w e l l, wait 24 u n t i l w e s e e N e i l C o l l i n s -- a n y i n v o l v e m e n t 25 w a s at s o m e s t a g e I h a d a s h a r e i n a p r o p e r t y in 26 D u n d a l k in p a r t n e r s h i p w i t h two o t h e r p e o p l e a n d I 27 o p t e d o u t of it a n d m y s h a r e s -- I w a s p a i d f o r m y 28 shares and I understood afterwards 29 s p o k e n to h i m a bout that b ut I had -- I h a d n e v e r I understood afterwards 1 t h a t Mr. C o l l i n s t o o k m y p l a c e as t h e s h a r e h o l d e r , 2 or p a r t n e r , or w h a t e v e r in that p r o p e r t y company. 3 4 A. But I didn't have any dealings with him and my 5 dealings were p u r e l y with the two other 6 shareholders. 7 2 6 6 Q. 8 A. 9 267 Q. 10 A. 11 268 Q. 12 A. 13 14 Because you asked me about Neil Collins. Yes? A n d the association. Yes? A n d t h a t is t h e o n l y t i m e I k n e w a n y t h i n g a b o u t Neil C o l l i n s . 2 6 9 Q. 15 16 H o w is t h a t r e l e v a n t t o t h i s l e t t e r ? H o w w o u l d y o u b e a u t h o r i s i n g t h e t r a n s f e r of s h a r e s to Neil Collins? A. I don't believe I d i d a n y t h i n g o f t h e sort. A s to 17 w h e t h e r you want me to s p e c u l a t e I c o u l d say well 18 Collins replaced m e . . . (INTERJECTION)? 19 27 0 Q. No. 20 A. No, 21 27 1 Q. I do not w a n t yo u to s p e culate, Mr. If McCann? b u t t h a t ... ( I N T E R J E C T I O N ) . Because what I u n d e r s t a n d is t h a t y o u h a v e no r e c o l l e c t i o n of this? 22 23 A. 24 272 Q. No, no. I am just w o n d e r i n g h o wever this letter was written, 25 h o w it c a m e a b o u t t h a t y o u w e r e a u t h o r i s i n g t h e 26 t r a n s f e r o f t h e s h a r e s to N e i l C o l l i n s ? 27 A. 28 27 3 Q. 29 A. I d o n ' t b e l i e v e t h a t I did. Is t h e r e a n y o t h e r N e i l C o l l i n s t h a t t h i s c o u l d b e ? No, no. I a m q u i t e s u r e t h a t is t h e p e r s o n a n d t h i s 1 m a y h a v e b e e n i n t e n d e d to be done in some w a y or 2 anot h e r but c e r t a i n l y I have no r e c o l l e c t i o n 3 w h a t e v e r of this authorisation. 4 274 Q Yes. Perhaps, you might tell me about this 5 a r r a n g e m e n t w i t h Mr. 6 personally? 7 A No, I h e a r d o f h im. think, 8 9 27 5 Q 10 A 11 276 Q 12 A 13 277 Q 14 A 15 278 Q 16 Collins? Did you knew him I met hi m once afterwards a g a i n o n l y " H e llo , I n i c e day ". Y o u h a d no -- y o u h a d n o . . . ( I N T E R J E C T I O N ) ? I k n e w h e was. Y ou knew who he was? Yes . He w a s a C o r k b u s i n e s s m a n ? A n d he w a s p r e t t y w e l l kn o w n . You must have be e n very su r p r i s e d whe n you saw this letter? 17 A 18 279 Q 19 A 20 28 0 Q 21 A 22 28 1 Q 23 A 24 In t h e l a s t few weeks, m y Lord? Yes ? I was very surprised. W h e n d i d you see this l e t t er for the first time? Well, it is s i n c e t h e t r a w l s t a r t e d . Yes? So, it h a s to h a v e b e e n i n t h e l a s t f o u r w e e k s o r so. 25 282 Q 26 A 27 28 3 Q 28 A 29 284 Q Since you got our letter? Yes, yes. In D e c e m b e r ? Yes, absolutely, as a r e s u l t of. 1 2 28 5 Q. J u s t t e l l me, you have i n d i c a t e d to me that 3 Mr. 4 some business venture? C o l l i n s m a y h a v e t a k e n y o u r p l a c e as p a r t n e r in 5 A. In Dundalk. 6 2 8 6 Q. In D u n d a l k ? 7 A. 8 287 Q. 9 Yes. However, Mr. 10 A. 11 288 Q. 12 A. 13 2 8 9 Q. t h a t is a v e r y r e m o t e c o n n e c t i o n w i t h Collins, is it n o t ? V e r y remote. You w ould not have met him? No. D i d y o u k n o w t h a t t h e r e w a s a Mr. John Collins 14 who was M a n a g i n g D i r ector of Guinness M a h o n 15 Cayman Trust Limited? 16 A. 17 29 0 Q. 18 A. 19 20 21 No. You did not No, no. know that? I n e v e r h e a r d o f him. I didn't know any p e o p l e in t h i s C a y m a n T r u s t . 29 1 Q. T h e r e is j u s t o n e o t h e r m a t t e r I w a n t t o r e f e r to in this letter, t h e l a s t p a r a g r a p h g o e s on: 22 23 24 "I h e r e b y a u t h o r i s e y o u t o t r a n s f e r at p a r to N e i l C o l l i n s o r h i s n o m i n e e t h e e n t i r e i s s u e d s h a r e c a p i t a l of B l u e L i m i t e d ." 25 26 D o e s t h a t n o t i n d i c a t e Mr. M c C a n n , 27 w h i c h t h a t is w o r d e d , 28 the T r u s t e e s to t r a n s f e r ? 29 f r o m t h e w a y in t h a t y o u h a d a u t h o r i t y to t e l l 1 292 Q 2 A 3 It w o u l d a p p e a r t o but, y o u know, I never saw that letter. 4 29 3 Q 5 A 6 294 Q 7 A 8 29 5 Q 9 A 10 296 Q I understand? Or that draft. Yes? Or I don't k n o w o f a n y b o d y e l s e w h o has. Yes? I d o n ' t b e l i e v e a n y of it h a p p e n e d . Yes. However, if y o u h a d a u t h o r i t y it w o u l d 11 m e a n that the Trustees must have appointed, 12 t h e D e e d of T r u s t , 13 i n o r d e r to g i v e y o u . . . ( I N T E R J E C T I O N ) ? 14 A If it w a s tru e. 15 297 Q If it w a s t r u e ? 16 A 17 298 Q 18 A 20 299 Q the p r o p e r t y in the t r u s t to you Yes . V e r y well. t a b 15 19 under I w a n t y o u to r e f e r t o p a g e ( E x h i b i t 3) 64. It is (Same H a n d e d ) ? T h a n k you. T h i s is a r e c o r d o f r e s i d e n t a n d n o n - r e s i d e n t loans 21 of £ 5 , 0 0 0 a n d over , w h i c h has b e e n o b t a i n e d from the 22 records of G u i n n e s s & M a h o n Ireland. 23 on the l e f t - h a n d side the cus t o m e r s a nd t ow a r d s the 24 end, 25 Y o u will see the fourth from the bottom: "Fruit I m p o r t e r s of I r e l a n d L i m i t e d . " 26 27 28 29 Do yo u see t hat? A Yes . D o y o u s e e t h a t it s h o w s t h e p r e s e n t b a l a n c e 40 1 Yes . 2 3 30 1 Q 4 Do y o u se e u n d e r t h e c o l u m n h e a d e d " C o m m e n t s " "Suitably secured." 5 Do yo u see t hat? 6 7 A 8 302 Q 9 10 I do. A r e y o u f a m i l i a r Mr. M c C a n n wit h the concept of cash b acked loans? A I am sorry Justice, am I familiar w i t h the c o n c e p t of ? 11 12 30 3 Q 13 A 14 304 Q 15 The c oncept of cash b a c k e d loans? Cash backed loans? Yes, I t h i n k so, yes. T h a t t h e l o a n w o u l d b e g i v e n in t h i s c a s e b y t h e b a n k a n d t h e y w o u l d u s e as s e c u r i t y a d e p o s i t ? 16 A 17 30 5 Q 18 A 19 306 Q 20 A 21 307 Q Sure . F o r t h e s a m e a m o u n t of t h e l o a n i n f a c t ? Right. You are f a m iliar wit h that? Y e ah , I must I a m f a m i l i a r w i t h that , yes. i n f o r m y o u Mr. M c C a n n t h a t o u r i n f o r m a t i o n is 22 that where Guinness 23 s u i t a b l y s e c u r e d l o a n t h a t t h e y m e a n a l o a n w h i c h is 24 cash backed by a deposit? 25 A & M a h o n I re l a n d r efer to a Yes . 26 It w o u l d a p p e a r t h e r e f o r e t h a t y o u r c o m p a n y h a d a 27 very substantial 28 which, 29 company, loan or overdraft, it is n o t c l e a r a n d t h a t it w a s s e c u r e d b y a d e p o s i t w i t h t h e is t h a t n o t so? 1 2 3 0 9 Q. 3 A. 4 31 0 Q. 5 A. 6 31 1 Q. Y o u r e a d it t h e r e ? B u t ... ( I N T E R J E C T I O N ) . Yes. I t a k e it t h a t y o u h a v e n o r e c o l l e c t i o n o f i t? No. Do y o u s e e a g a i n it is y o u r i n f o r m a t i o n t h a t p e o p l e 7 who h a d e s t a b l i s h e d trusts w ere e n a b l e d to use the 8 d e p o s i t in G u i n n e s s M a h o n C a y m a n T r u s t , 9 C a y m a n c o m p a n y h a d in G u i n n e s s as a s e c u r i t y . 10 11 A. & M a h o n in Ireland, Yo u see that in the l e t t e r ? I am sorry Judge am I m i ssing something? I do n o t se e -- is t h e r e a dat e. 12 13 Yes. which that 312 Q. 14 T h e dat e, t h e r e p a y m e n t date, is t h e b e s t w e c a n give? 15 A. 16 31 3 Q. 17 A. 18 314 Q. 19 Yes, M a r c h 1973. 31st M arch 1973? Yes, yes. T h e r e is a v e r y s u b s t a n t i a l d e p o s i t a p p a r e n t l y b e i n g u s e d to s e c u r e that loan? 20 A. 21 31 5 Q. 22 A. 23 3 1 6 Q. 24 A. 25 317 Q. 26 A. 27 318 Q. 28 A. 29 3 1 9 Q. Yes. Have you any explanation for...(INTERJECTION)? Well, I j u s t a m n o t f a m i l i a r w i t h it. Y o u a r e n o t f a m i l i a r w i t h it? No. P e r h a p s y o u m i g h t t r y to s e e ? Yes. If y o u c a n g e t a n y i n f o r m a t i o n a b o u t i t? If I m a y t a k e a c o p y ? Y o u m a y t a k e it, yes. We h ave kept out the o ther 1 Okay. 2 3 32 0 Q 4 A 5 32 1 Q 6 A 7 322 Q O f o t h e r p e o p l e in o t h e r c o m p a n i e s ? So, w e w i l l p u r s u e t h a t one. If y o u c a n p u r s u e t h a t one, yes? Yes . We also have information that there was a 8 m a n a g e m e n t r e p o r t i n t h e 1 974 t o t h e e f f e c t 9 that there was a s u i t a b l y s e c u r e d l oan to your 10 c o m p a n y of £96,000. 11 r e p o r t o f 3 1 s t O c t o b e r 1974. 12 you can get any i n f o r m a t i o n on that? 13 A 14 32 3 Q I will. Mr. T h a t is i n t h e m a n a g e m e n t C a n y o u s e e if I w o u l d b e v e r y h a p p y to, McCann, Justice. w e do t a k e a c o f f e e b r e a k . I was just 15 w o n d e r i n g if this w o u l d be a s u i t a b l e t i m e for a 16 coffee break? 17 A 18 324 Q 19 20 T h a t is a v e r y n i c e idea. V e r y w e l l t h e n. We w i l l sa y a b o u t t e n m i n u t e s or so? A Yes . 21 SHORT ADJOURNMENT 22 23 24 A 25 32 5 Q 26 27 A 28 326 Q 29 Apologies Judge. No, t h a t is f i n e Mr. Mr. McCann? Yes . McCann. We will continue then 1 2 327 Q. The pe o p l e that you h ad the a r r a n g e m e n t w i t h or you 3 w e r e in b u s i n e s s w i t h in Dundalk; 4 names, 5 A. 6 328 Q. 7 A. 8 3 2 9 Q. 9 A. 10 33 0 Q. 11 A. 12 33 1 Q. 13 A. Mr. what were their McCann? A l e x S p a i n w a s one. Yes? A n d Philip M o n a h a n was another. Yes. W a s y o u r p l a c e t a k e n i n t h a t b y Mr. Collins? I b e l i e v e so. Y o u b e l i e v e so? Yes. W a s t h a t a p r o p e r t y d e v e l o p m e n t or w h a t w a s it? It w a s a p r o p e r t y d e v e l o p m e n t . T h e r e h a d b e en , you 14 know, 15 p a r t i c u l a r d e v e l o p m e n t the y were g oing to do and I 16 didn't 17 to o p t out. 18 332 Q. 19 A. 20 33 3 Q. 21 A. Yes, 22 334 Q. Yes. 23 A. 25 33 5 Q. 26 27 A. 28 3 3 6 Q. 29 feel co m f o r t a b l e and I said that I w o u l d like Yes? And they produced. Mr. Mr. 24 bits of p r o p e r t y i n v o l v e d in the t h i n g a nd a Collins? I believe. W o u l d y o u h a v e a n y o b j e c t i o n t o o u r w r i t i n g to C o l l i n s to g e t h i s e v i d e n c e i n t h i s c o n n e c t i o n ? A b s o l u t e l y not. V e r y w e l l. I w a n t to d e a l w i t h a n o t h e r m a t t e r n o w about Fruit Importers of Irel a n d Limited? Yes. It a p p e a r s t h a t F r u i t I m p o r t e r s of I r e l a n d L i m i t e d 1 2 3 337 Q I t h i n k it m a y r e f r e s h y o u r m e m o r y if w e t u r n to 4 p a g e 48, 5 t e l e x of the 14th O c t o b e r 1977 6 A 7 338 Q 8 A 9 339 Q 10 A 11 34 0 Q 12 A 13 34 1 Q Yes, t h e t e l e x t o Mr. Keane. Have you got the (Same H a n d e d ) ? I have. Y o u k n e w Mr. Martin Keane? Yes . W o u l d you have dealings with him? Yes, yes. Y o u n e v e r m e t Mr. John Furze? No. D i d y o u k n o w o f Mr. Furze's existence until 14 the recent d e v e l o p m e n t s that have b e e n in the 15 public domain? 16 A 17 342 Q 18 A 19 34 3 Q 20 A 21 344 Q No. You did not? No. Y o u h a v e s e e n t h i s t e l e x I t a k e it Yes . Does it n o t a p p e a r f r o m t h a t t h a t F II h a d a d e p o s i t of $29,9 2 7 ? 22 23 A 24 34 5 Q 25 A 26 346 Q 27 A 28 347 Q 29 A ( E x h i b i t 4)? Yes, it a p p e a r s t h a t way. Have you a ny r e c o l l e c t i o n of this? No. You have not? No. You have read this document? 1 348 Q. It d o s e a p p e a r t h a t t h i s w a s a n i n s t r u c t i o n , 2 not, 3 M a h o n C a y m a n T rust w h i c h h a d an a c c o u n t in Dublin, 4 a n d o u t o f t h i s sum, 5 be p a i d two drafts? 6 A. g i v e n m y Mr. w a s it F u r z e o n b e h a l f of t h e G u i n n e s s t h i s FII d e p o s i t , I m e a n since I saw this y o u w e r e to I mean I have racked my 7 brains. 8 l o o k e d t h r o u g h e v e r y w h e r e in m y o w n f i l e s a n d j u s t 9 -- it b u g s me. I have looked through old diaries. I have T h e r e is n o t h i n g I c a n r e c a l l a b o u t 10 t h i s a n d as I s a i d I k n o w M a r t i n K e a n e . 11 h e a r d o f t h e o t h e r m a n a n d n o n e of t h i s r i n g s a n y 12 bells, 13 3 4 9 Q. just nothing. Is it n o t c l e a r t h a t y o u a r e r e c e i v i n g f r o m t h e 14 a c c o u n t of G u i n n e s s M a h o n C a y m a n T r u s t in 15 Guinness 16 A. I never Well, & M a h o n in D u b l i n t h i s s u m o f m o n e y ? it s c e r t a i n l y -- t h e i n t e r n a l m e m o is t h e r e 17 a n d it a p p e a r s 18 a r r a n g e m e n t to d o t h a t b u t 19 o n it J u d g e a n d as I s a i d . . . ( I N T E R J E C T I O N ) . 20 35 0 Q. W e h a v e, f r o m that that t h e r e was an I can't t hrow any light a n d I w i l l s h o w you, the s un d a r y 21 s u b - c o m p a n y a c c o u n t a n d it is a b a d p h o t o s t a t b u t 22 y o u w i l l a b l e t o m a k e o u t t h e -- 23 Handed)? 24 A. 25 35 1 Q. 26 T h a n k you. If y o u s e e t h e p a y m e n t to F r u i t I m p o r t e r s of t h i s f i g u r e of £ 2 , 1 6 6 ? 27 A. 28 352 Q. 29 Yes. ( E x h i b i t 5 ) (Same Yes. Y o u w i l l t h e n se e o n t h e r i g h t - h a n d s i d e t h e b a l a n c e 1 h a s n o t c o m e o u t in r e l a t i o n t o t h e f i g u r e t h a t 2 s h o w s t h e b a l a n c e o n t h e r i g h t - h a n d side, 3 is £ 3 3 , 0 0 0 a n d t h e o t h e r b a l a n c e . 4 a r i t h m e t i c of the sit u a t i o n shows that the bala n c e 5 t h a t w a s l e f t a m o u n t s to t h e f i g u r e , 6 r e f e r r e d to in t h i s Te l e x , 7 A 8 35 3 Q 9 However, the t h a t is of £ 1 4,655? Yes . What I a m i n d i c a t i n g to y o u is t h a t t h e m o n e y c a m e out? 10 A 11 354 Q 12 A 13 35 5 Q 14 Right. Of the account? Right. T h a t G u i n n e s s M a h o n C a y m a n T r u s t L i m i t e d h a d in Dublin, have you any doubt about this? 15 A Well, I me a n that looks 16 356 Q Yes. W e l l ...(INTERJECTION)? 17 A 18 357 Q 19 20 A 21 358 Q 22 A 23 359 Q 24 A 25 26 there 36 0 Q 27 f a i r ly strong. I c a n ' t s e e t h e d a t e of t h e m o n e y c o m i n g out. No, the photostat is v e r y b ad . I agree with you Mr. M c C a n n it is v e r y h a r d to m a k e it o u t ? I s e e t h e d a t e now. However, t h e d a t e is t h e r e . It is 1 9 7 7 ? It is O c t o b e r . It is 1 3 t h O c t o b e r 1 9 7 7 ? Yes. T h i s o n e h e r e is -- yes, yes, yes. I just have , y o u k n o w -- I h a v e n o m e m o r y o f it. Yes. L e t us a s s u m e t h a t t h e r e c o r d s h o w s t h i s payment ? 28 A 29 36 1 Q Sure . C a n yo u e x p l a i n h o w you came to be p a i d m o n e y w h i c h 47 1 2 3 Well, 4 -- I j u s t d o n ' t 5 362 Q 6 A 7 36 3 Q I m e a n if I a m s p e c u l a t i n g , y o u know, perhaps know. V e r y w el l . I d o n ' t know. I w a n t n o w to t u r n to T h e I n t e r n a t i o n a l Fruit Agents Limited? 8 9 A 10 364 Q Right, Ju d g e . If y o u w o u l d l i k e t o l o o k at y o u r s t a t e m e n t to r e f r e s h y o u r m e m o r y o n i t? 11 12 A 13 36 5 Q 14 Yes . It w a s i n c o r p o r a t e d in the y e a r e n d i n g the 31st O c tober 1972? 15 A 16 3 66 Q 17 Yes . It is l i s t e d as a s u b s i d i a r y o f FII i n i t s a c c o u n t s , is t h a t n o t r i g h t ? 18 A 19 367 Q Yes, yes. The documents, w h i c h I will put to you in a moment, 20 s h o w that its a d d r e s s was C/ O G u i n n e s s M a h o n 21 C a y m a n Trust. 22 A 23 368 Q Did you know that? No. Y o u t e l l us t h a t it w a s s o l d i n M a r c h 19 74 t o a 24 company called Montagu Insurance Company. 25 y o u j u s t l o o k at this, 26 documents 27 28 29 A Right. Yes . it is E x h i b i t Would 5 of your (Same H a n d e d ) ? Y o u a r e v e r y g o od . T h a n k you v e r y much. 1 between Fruit 2 a n d M o n t a g u I n s u r a n c e L i m i t e d o f a n a d d r e s s in 3 Grand Cayman? 4 Yes . 5 37 0 Q Importers Of Ireland Limited It is a n a g r e e m e n t b y w h i c h FII a g r e e d t o 6 s e l l t h e e q u i t y in a f i r m c a l l e d I n t e r n a t i o n a l 7 Agents Limited, 8 was a p p a r e n t l y £110,800? 9 A 10 37 1 Q 100 o r d i n a r y s h a r e s a n d t h e p r i c e Yes . FII s o l d i t s s h a r e h o l d i n g i n t h e c o m p a n y t o 11 M on t a g u Insurance Limited by that document, 12 n o t so? 13 A 14 372 Q I w a n t y o u to r e f e r n o w t o t h e d o c u m e n t s o n pages 16 are n e w a c c o u n ts b e i n g o p e n e d 17 Handed)? A 19 37 3 Q 20 A 21 374 Q 38 t o 41 o f o u r file. Ms. Cummins, (Exhibit they 1 ) (Same T h a n k you. Have you got these? Yes . International -- it is s l i g h t l y n o t q u i t e i n o r d e r in m y c o p y b u t le t us l o o k at w h a t it is? 22 23 A 24 37 5 Q Yes . It is a n a u t h o r i s a t i o n t o o p e n a n e w a c c o u n t . 25 n a m e is I n t e r n a t i o n a l F r u i t A g e n t s 26 is C / O GMCT , 27 A 28 376 Q 29 is t h a t Yes . 15 18 Fruit The and the address w h i c h is G u i n n e s s M a h o n C a y m a n T r u s t ? Yes . The a ddress of the I n t e r n a t i o n a l Guinness M a h o n Cayman Trust. Fruit Agents is It is a f i x e d d e p o s i t . 1 T h e n u m b e r o f t h e a c c o u n t is h a r d t o m a k e o u t b u t it 2 is u p t h e r e on t h e r i g h t - h a n d s i d e ? 3 Yes . 4 377 Q 5 It is i n F r e n c h F r a n c s I think. It is f r o m t h e French Francs Ledger? 6 A 7 378 Q 8 A 9 379 Q Yes . W o u l d you turn over the next page? Yes . It is a g a i n an a u t h o r i s a t i o n to o p e n a d e p o s i t account. 10 11 A 12 38 0 Q It is t h e 4 t h O c t o b e r 1 9 7 8 ? Yes . It is t h e I n t e r n a t i o n a l Fruit Agents Limited. 13 a c c o u n t n u m b e r is g i v e n a n d t h e a m o u n t o f t h e 14 d e p o s i t is g i v e n in F r e n c h F r a n c s . 15 m i l lion French Francs? 16 A 17 38 1 Q The It is n e a r l y o n e Right. T h e n e x t d o c u m e n t is a n o t h e r a u t h o r i s a t i o n to o p e n 18 Deposit Account. 19 mentioned. 20 is -- t h e a m o u n t o f t h e d e p o s i t is h a l f a m i l l i o n 21 French Francs? 22 A 23 382 Q The n ame of the c o m p a n y we have T h e a d d r e s s is C / O G u i n n e s s M a h o n a n d it Yes . The last document, that I w a n t t o r e f e r t o you, 24 dated earlier. 25 It is e x t e r n a l 26 it is 2 3 r d N o v e m b e r 197 6 ? 27 A It is I n t e r n a t i o n a l fixed deposits Fruit Agents. in F r e n c h F r a n c s a n d Yes . 28 It s ho ws , 29 F r a n c s a n d a p p a r e n t l y it w a s r e d u c e d t o a s m a l l i n fact, is t h e b a l a n c e t h e r e of F r e n c h 1 amount. 2 statement. 3 it is a c o n t i n u a t i o n o f t h e p a r a g r a p h , 4 p r e v i o u s p a r a g r a p h r e f e r s to I n t e r n a t i o n a l 5 Agents Limited? 6 So r r y , 7 p a g e 4. 8 384 Q 9 A 10 38 5 Q I w a n t to r e f e r y o u n o w t o y o u r o w n yes, S e e at p a g e f i v e o f y o u r o w n s t a t e m e n t , International w h i c h on the Fruit F ruit A g e n t s L i m i t e d on Yes? On the top of pag e five. I a m o n t o p o f p a g e 5 now. L o o k at t h e l a s t s e n t e n c e in the p a r a g r a p h ? 11 12 A 13 386 Q 14 Yes . It re a d s : "I b e l i e v e t h a t . . . " 15 16 It is t h e s e c o n d l a s t s e n t e n c e : 17 "I b e l i e v e t h a t FII w a s t h e b e n e f i c i a l o w n e r o f t h e f u n d s in t h e s e b a n k a c c o u n t s ." 18 19 20 These b a n k acc o u n t s are r e f e r r e d to in the ea r l i er 21 sentence: " N o t w i t h s t a n d i n g t h e s a i d s a l e it appears that non-resident bank accounts were m a i n t a i n e d w ith the B a n k in the name of I n t e r n a t i o n a l Fruit Ag e n t s f r o m O c t o b e r 197 6 to a p p r o x i m a t e l y October 1980." 22 23 24 25 26 A Yes . 27 I w a n t y o u to t e l l us h o w it c a m e a b o u t t h a t FII w a s 28 t h e b e n e f i c i a l o w n e r of t h e f u n d s i n t h e s e b a n k 29 accounts ? 1 2 388 Q 3 A 4 389 Q 5 A Yes . A n d then this happened. Yes ? Yes, I t h i n k -- I b e l i e v e t h a t this, y o u k n o w -- it puzzles u s . 6 7 39 0 Q 8 A 9 Yes? A n d I d o n ' t u n d e r s t a n d w h y o r h o w IFA, continued, y o u know, or the name w o u l d have ever continued, 10 a f t e r t h e t h i n g h a d b e e n s o l d a n d I t h i n k it j u s t 11 l o o k s -- it l o o k s a m e s s 12 it w a s . . . ( I N T E R J E C T I O N ) . 13 39 1 Q 14 However, s u r e l y Mr. M c C a n n j u s t t o s a y it l o o k s a mess isn't a proper explanation? 15 A 16 392 Q 17 A 18 39 3 Q Sorry. For the situation? Sorry. If y o u s a y a n d in y o u r s t a t e m e n t 19 b e n e f i c i a l l y ow n e d , 20 monies 21 f rom that p e r i o d 1976 until A say they were h o w d i d F II b e n e f i c i a l l y o w n t h e in t h e s e a c c o u n t s ? I u n d e r s t a n d tha t, y o u r know, t h e p a r t i c u l a r -- b u t 22 a g a i n t h i s is n o t 23 Ms. 24 a b s o l u t e l y a w a r e o f w h a t m o n i e s w e r e d u e t o FII t h a t 25 h a d not b e e n t r a n s f e r r e d a nd e v e n t u a l l y all of those 26 m o n i e s w e r e t r a n s f e r r e d b a c k i n t o F II i n D u b l i n . 27 394 Q 29 Spain d e a l i n g wit h that p a r t i c u l a r b u s i n e s s was However, Mr. M c C a n n if the d o c u m e n t s r e f l e c t the true situation? 28 A f irst-hand but I u n d e r s t a n d that 1 39 5 Q A l l t h e s h a r e s w e r e s o l d a n d FII n o l o n g e r h a d a n y i n t e r e s t in this c o m p a n y ? 2 3 A 4 396 Q Sure . What I w a n t to k n o w is w h y y o u s a y i n y o u r s t a t e m e n t 5 t h a t y o u r c o m p a n y b e n e f i c i a l l y o w n e d t h e s e s u m s in 6 the a ccount? 7 A 8 397 Q 9 A 10 398 Q 11 A 12 399 Q 13 A 14 400 Q Yes? So r r y , A I w a s g o i n g to s a y I j u s t d o n ' t u n d e r s t a n d . Y o u do not u n d e r s t a n d ? Yes . I see? May I consult Yes, MR. 15 16 I ...(INTERJECTION). for a m o me n t ? yes? O'KEEFFE: Yes, Can we step ou ts i d e the door? of course, yes. 17 18 SHORT ADJOURNMENT 19 20 A 21 401 Q No, I a m s o r r y f o r r u s h i n g you, 22 A No, y o u a r e not. 23 402 Q Judge, What I am sorry b u t ...(I N T E R J E C T I O N ) . Mr. McCann? I w a n t e d t o s u g g e s t w a s if t h e r e a r e m a t t e r s 24 t h a t y o u w a n t to c l a r i f y l a t e r o n y o u c a n d o it b y 25 l e t t e r t o us, 26 A 27 403 Q if n e c e s s a r y ? Sure . I j u s t w a n t to g e t y o u r s t a t e m e n t t o d a y as to w h a t 28 you recollect. 29 w h a t y o u h a v e s t a t e d in y o u r s t a t e m e n t t o u s ? Yo u see w h a t I want you to clar i f y 1 2 404 Q 3 A 4 405 Q 5 A T h a t y o u r c o m p a n y w a s t h e b e n e f i c i a l o w n e r of it? Right. T h a t is w h a t Well, n o w as I u n d e r s t a n d a n d p l e a s e b e a r w i t h m e 6 because 7 transactions. 8 406 Q 9 A 11 407 Q 12 A 13 408 Q Yes? But I have b e e n thro u g h all of this but I just m a y Yes ? A n y w a y j u s t to s a y t h a t t h e c o m p a n y w a s sold Can I just stop you there. Do y o u k n o w w h o M o n t a g u were? A 17 No, j u s t t h e b u y e r b u t w h o t h e y w e r e or a n y t h i n g about them I don't 18 409 Q 19 A 20 410 Q 21 A 22 411 Q 23 A 24 know. It m i g h t h a v e b e e n a s h e l f c o m p a n y ? It m a y h a v e b e e n . Yes? I just...(INTERJECTION). Very well? I d o n ' t k n o w b u t t h e c o n s i d e r a t i o n w e n t b a c k to Dublin, 25 412 Q 26 A An d, 27 413 Q Yes? 28 A 29 familiar wit h the original to Montagu. 15 16 I am not n o t h a v e t a k e n it a l l o n b o a r d . 10 14 I want to clarify? I t h i n k w a s s h o w n in t h e a c c o u n t s . Yes ? y o u know, c l e a r l y was d ealt with. A n d t h e n a f t e r t h a t t h i s o t h e r c a s h s t a r t e d to c o m e t h r o u g h a n d w a s l o d g e d a n d I t h i n k t h e f i r s t o n e or 1 two documents show, 2 International Fruit Agents Limited, 3 an e x planation? 4 Fruit Ag e n t s but not I n t e r n a t i o n a l Fruit Agents 5 L i m i t e d a n d s o m e of t h e l a t e r o n e s I think have 6 Limited. 7 414 Q. 8 A. 9 y o u know, l o d g e m e n t to I d o n ' t t h i n k so. y o u know. Is it International Yes? But w h e t h e r that was a m i s t a k e or d e l i b e r a t e but n o n e o f it e x p l a i n s t h e f a c t t h a t t h i s International F r u i t A g e n t s h a d b e e n d i s p o s e d of. 10 11 415 Q. 12 A. Yes? A n d t h e f u n d s h a d g o n e b a n k i n t o t h e c o m p a n y at 13 h o me , 14 t h i s is o b v i o u s l y i r r e g u l a r a n d I d o n ' t h a v e a n 15 explanation. 16 4 1 6 Q. our Irish company, V e r y well. I just want to r e f e r yo u to a n o t h e r 17 document. 18 (Same H a n d e d ) 19 A. 20 417 Q. a n d t h e r e - a p p e a r a n c e of T h a t d o c u m e n t n o w is p a g e 52, T h a n k you. T h i s is a d o c u m e n t , it is a n i n t e r n a l m e m o r a n d u m of Guinness 22 t h e l o w e r p h o t o s t a t is c l e a r e r ? A. 24 418 Q. Cummins ( E x h i b i t 4)? 21 23 Ms. & M a h o n a n d t h e u p p e r p h o t o s t a t is b a d b u t S ure. It is a " C h a n g e s In S t a t i c D a t a . " T h i s is a b a n k i n g 25 term , 26 n o t e s a y i n g a n y c h a n g e s in t h e d a t a i n t h e a c c o u n t 27 are n o t e d on t hese p ieces of p aper? 28 A. 29 4 1 9 Q. as I u n d e r s t a n d it, w h i c h is j u s t m e r e l y a Yes. However, what I w a n t t o d r a w y o u r a t t e n t i o n to is 1 this: 2 that? 3 Yes . 4 420 Q 5 It is t h e 2 3 r d N o v e m b e r 197 6 . Do y o u s e e It s a y s : "International Fruit Agents Limited." 6 7 Do yo u see t hat? 8 A 9 421 Q Yes . T h e n it says: "NR" 10 11 w h i c h is n o n - r e s i d e n t ? 12 13 A 14 422 Q 15 Yes . Then: " F i x e d DA" 16 17 t h a t is d e p o s i t a c c o u n t ? 18 A 19 423 Q Yes . "Jersey & with GMCT"? 20 21 A 22 424 Q 23 A 24 425 Q 25 Yes . The v e r y d i f f i c u l t p h o t o s t a t to r e a d a b o v e t h at? Yes, b u t . . . (INTERJECTION). Also show Guinness & Mahon. It is a " C h a n g e s Static Data"? 26 A 27 426 Q 28 A 29 427 Q Yes . It s e e m s t o b e t h e 2 5 t h N o v e m b e r ? Yes . In 1 "Fruit Agents," 2 3 that c omes out all right. 4 H o w e v e r t h e n it says: "Jersey Islands Ledger"? 5 6 7 428 Q. Sorry, it is: "Channel 8 Islands Ledger"? 9 10 A. 11 4 2 9 Q. Yes. However, w e n e e d n o t b o t h e r a b o u t t h a t one. The 12 b o t t o m o n e is a r e c o r d w h i c h s h o w s t h a t t h i s c o m p a n y 13 International 14 d e p o s i t a c c o u n t in the J e r s e y Islands, 15 A. 16 430 Q. 17 A. 18 431 Q. 19 A. 20 432 Q. Fruit Agents Limited had a fixed in Jersey? I j u s t d o n ' t h a v e a n y f a s t a n s w e r f o r t ha t , Ju d g e . Yes? If I m i g h t b e p e r m i t t e d ? Yes, do? To search. Yes. Y o u c a n c o n s i d e r it a n d I t h i n k u n f o r t u n a t e l y 21 w e m a y h a v e to a s k y o u c o m e b a c k a g a i n or w e c a n do 22 it b y l e t t e r b u t y o u c a n c o n s i d e r i t? 23 A. 24 433 Q. Yes. I w a n t y o u to s e e w h a t I a m s u g g e s t i n g is t h a t t h i s 25 co m p a n y w h i c h you said you b e n e f i c i a l l y o wned the 26 a c c o u n t s of ? 27 A. 28 434 Q. 29 S ure. W h i c h w e r e in G u i n n e s s & M a h o n in D u b l i n also h a d 1 2 A n d t h a t t h e r e is a s u b s i d i a r y o f G u i n n e s s 3 in Jersey, 4 Guinness 5 Mahon Jersey Limited? 6 A 7 436 Q 8 A 9 437 Q 11 A 12 438 Q t h e r e w a s a s u b s i d i a r y of & M a h o n in J e r s e y , at t h e tim e, Guinness Yes . You know nothing about this? I k n o w n o t h i n g a b o u t t h e w h o l e o f th i s . Just in that c o n n e c t i o n I w a n t to p ut a n o t h e r l e t t e r t o you. 10 & Mahon It is p a g e 56 ( E x h i b i t 7 ) (Same H a n d e d ) ? Yes . T h i s is a v e r y l o n g l e t t e r . T h e r e is c o n f i d e n t i a l 13 i n f o r m a t i o n in t h i s l e t t e r a n d I k n o w y o u w i l l t r e a t 14 it as c o n f i d e n t i a l ? 15 A 16 439 Q 17 Sure . I a m o n l y r e f e r r i n g it t o y o u b e c a u s e of o n e p a r t in it w h i c h I w i l l d r a w y o u r a t t e n t i o n t o ? 18 A 19 440 Q Yes . I w i l l j u s t t e l l y o u w h a t t h e l e t t e r is. 20 d a t e d 1 6 t h O c t o b e r 1987. 21 English Guinness 22 A 23 441 Q 24 It is It is a l e t t e r f r o m t h e & Mahon company? Yes . W h i c h was the pa r e n t c o m p a n y of Guinn e s s & Mahon Ireland? 25 A 26 442 Q 27 Yes . It is a d d r e s s e d t o Mr. L i m i t e d in D u b l i n . 28 A 29 443 Q Yes, P e n d e r in G u i n n e s s & Mahon Do y o u s e e t h a t ? I do. It is a b o u t C o l l e g e T r u s t e e s . 58 Do y o u s e e t h a t 1 Yes, 2 3 444 Q 4 A 5 445 Q 6 A 7 446 Q 8 A 9 447 Q I do. If I m a y j u s t p a u s e t h e r e ? Yes . H a v e yo u h e a r d of C o l l e g e T r u s t e e s ? Yes, bu t o n l y since. Since this has started? Yes . College Trustees, I t h i n k y o u know, 10 It is a s u b s i d i a r y of t h e G u i n n e s s 11 companies. 12 s u b s i d i a r y of G u i n n e s s 13 this 14 College Trustees? 15 A 16 448 Q 17 A 18 449 Q It w a s the n. l e t t e r is: Which, i n fact, I a m o n l y d r a w i n g y o u r a t t e n t i o n t o t h i s l e t t e r fo r 21 arise in respect 24 25 T h e w r i t e r o f t h i s l e t t e r is circumstances that could of the sale of C o l l e g e T r u s t e e s ? Yes . He d i s c u s s e s on the s e c o n d p a g e the c l i e n t s of College Trustees, "...which may have a loyalty..." 26 27 28 29 What Yes . d iscussing the various 450 Q & M a h o n in I r e l a n d . d i d t a k e p l a c e l a t e r on? 20 23 It w a s o r i g i n a l l y a Yes . this purpose: A & M a h o n g r o u p of Is a d i s c u s s i o n a b o u t t h e s a l e o f 19 22 is a c o m p a n y . he says, " to G u i n n e s s the Guinness & M a h o n s p e c i f i c a l l y or & Mahon group generally." 1 Yes . 2 3 451 Q W h i c h C o l l e g e T r u s t e e s m a n a g e d a n d t h e n he sets out 4 the c o m p an i e s w h i c h t hey managed. 5 over the pag e you will see "trusts" and then 6 " c o m p a n i e s "? 7 A 8 452 Q 9 A 10 453 Q 11 A 12 454 Q 13 If y o u w o u l d t u r n A l l ri g h t . Y ou w ill see h al f w a y ...(I N T E R J E C T I O N ) ? Yes, s orr y, I h a v e it he r e . H a v e y o u g o t it t h e r e ? Yes . Y o u w i l l se e h a l f w a y -- do y o u se e t h e l i s t t h a t is headed "companies"? 14 A 15 455 Q Yes . "International Fruit Limited"? 16 17 A 18 456 Q Yes . What I a m p o i n t i n g o u t t o y o u Mr. M c C a n n is t h a t 19 International 20 w h i c h was a c l i e n t of C o l l e g e T r u s t e e s ? 21 A 22 457 Q Fruit L i m i t e d was in 1987 a c o m p a n y Yes . A n d this l ends s u p p o r t to the n o t e t h a t I r e f e r r e d 23 y o u to e a r l i e r t h a t C o l l e g e T r u s t e e s -- t h a t t h i s 24 c o m p a n y h a d an a c c o u n t in the J e r s e y c o m p a n y of 25 Guinness 26 that the position? 27 A 28 458 Q 29 A & Mahon. International Y o u k n o w n o t h i n g a b o u t it, is Fruit L i m i t e d I don't. Yes? B u t I d o k n o w I t h i n k at s o m e s t a g e t h a t -- no, 60 I 1 don't. 2 t h a t is n o t as F y f f e s . 3 459 Q 4 A 5 6 I am s o r r y I was g o i n g to sa y Fyf f e s but T h a t is n o t F y f f e s , No, Fyffes had some relationship, relationship, 460 Q no? a management for a short w h i l e i n . . . ( I N T E R J E C T I O N ) . I w i l l g i v e y o u a c o p y o f t h i s l e t t e r b u t I do t h i n k 7 w e w o u l d h a v e to k e e p t h e c o n f i d e n t i a l i n f o r m a t i o n 8 o u t of it? 9 A 10 461 Q Yes . If t h a t is a l l r i g h t w i t h you, Mr. O'Keeffe? 11 MR. O'KEEFFE: Of course. 12 MR. JUSTICE COSTELLO: If y o u w o u l d l i k e t o l o o k 13 at i t ? 14 MR. O'KEEFFE: Yes, 15 MR. JUSTICE COSTELLO: A n d r e a d it y o u r s e l f . 16 MR. O'KEEFFE: W e c a n l o o k at it b e f o r e 17 18 Ju d g e . w e le a v e . 462 Q MR. JUSTICE COSTELLO: 19 Y o u c a n l o o k at it b e f o r e you l e a v e , y e s . 20 Mr. 21 y o u r s o l i c i t o r i n r e l a t i o n to P a r i s 22 Limited? 23 A 24 463 Q 25 A 27 464 Q 29 we d id re c ei v e d o c u m e nt s y e s t e r d a y from Investments Yes . We h a v e not h a d an o p p o r t u n i t y to e x a m i n e t h e m properly? 26 28 McCann, Fine . S o it m a y b e n e c e s s a r y to c a l l y o u b a c k w h e n w e h a v e h a d a n e x a m i n a t i o n of i t? 1 465 Q There m a y be o ther m a t t e r s a r i s i n g w h i c h we w o u l d l i k e y o u r a s s i s t a n c e o n? 2 3 A 4 4 66 Q Yes . T h a t is a l l I h a v e to a s k y o u at t h e m o m e n t . 5 Ms. 6 however? 7 A M a c k e y w o u l d l i k e to a s k y o u a f e w q u e s t i o n s Sure . 8 E N D O F E X A M I N A T I O N O F MR. 9 MR. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 JUSTICE COSTELLO N E I L M c C A N N BY 1 M S . MACKEY 2 3 4 4 67 Q. MS. MACKEY: Mr. 5 McCann, j u s t if we c o u l d go b a c k f o r a m o m e n t to your s tatement? 6 7 A. 8 468 Q. 9 A. 10 4 6 9 Q. 11 A. 12 470 Q. Yes. H a v e y o u g o t it t h e r e ? Yes. If y o u w o u l d j u s t t u r n t o p a g e 5 (Exhibit 1)? Yes. U p at t h e top, it is a c o n t i n u a t i o n of t h e p a r t o f 13 your statement that deals with International Fruit 14 Agents Limited, 15 A. 16 471 Q. Right. It is w h a t w e h a v e j u s t b e e n t a l k i n g a b o u t now, 17 International 18 Guinness 19 A. 20 472 Q. 21 A. 22 473 Q. w h i c h b e g a n on the p r e v i o u s p age? Yes, Fruit Agents' a c c o u n t s in & M a h o n f r o m 1976 to 1980? at l e a s t I t h i n k ...(I N T E R J E C TI O N) . It is w h a t w e w e r e t a l k i n g a b o u t e a r l i e r ? Yes, As ri g h t . I u n d e r s t a n d w h a t y o u w e r e s a y i n g t o us e a r l i e r , 23 after International 24 c o n t i n u e d to b e t r a n s f e r r e d a n d w a s l o d g e d i n t o i ts 25 account there? 26 A. 27 474 Q. 28 A. 29 475 Q. Fruit Agents had been sold m o n e y S ure. A n d y o u d e s c r i b e d it as a m e s s a n d so o n? Yes. However, I am just not t o t a l l y c l e a r a n d if I c o u l d 1 c l a r i f y it a l i t t l e b i t b e t t e r I w o u l d b e g l a d ? 2 Right, 3 476 Q Yes ? 4 A Yes . 5 477 Q I w i l l try. W h a t e x a c t l y h a p p e n e d at t h a t s t a g e ? 6 the name of Intern a t i o n a l 7 h a v e b e e n o p e n e d in G u i n n e s s 8 that right? 9 A 10 478 Q It a p p e a r s t h a t way, 12 A 13 479 Q 14 A 16 480 Q 17 A 18 481 Q 19 A & M a h o n i n 197 6 , is yes. was there? I d o n ' t t h i n k so. No, so t h i s w a s o p e n e d . monies 15 a p p e a r s to There was not one there dating from the time prior t o t h e sale, 11 Fruit Agents A n a c c o u n t in Into that account came what exactly? I h a v e a n o t e h e r e if I m a y r e a d it. Certainly? M a y b e it w i l l b e m o r e h e l p f u l . Yes ? It j u s t says: " I n t e r n a t i o n a l F r u i t A g e n t s 197 6 19 80. We do not k n o w or w h y 20 21 22 482 Q 23 So r r y , Mr. 24 A 25 483 Q 26 A c ould I just i n t e rr u p t you for a mo m e n t McCann? Yes . Did you prepare this note? No, it is p r e p a r e d b y t h e p e o p l e w h o h a v e b e e n, 27 know, 28 in-house and s o r r y . . . (INTERJECTION). 29 working, the p r ofessionals and the people you 1 A. No, no. I a m s o r r y it h a s n ' t . This has been 2 p r e p a r e d b y t h e p e o p l e i n - h o u s e b u t it 3 i s ...(INTERJECTION). 4 484 Q. 5 A. 6 485 Q. 7 A. Mr s. C h o s e in p a r t i c u l a r . 8 4 8 6 Q. What i n f o r m a t i o n w o u l d s h e h a v e u s e d i n o r d e r to 9 10 MS. MACKEY: In F y f f e s ? In Fyffes. W h o w o u l d h a v e p r e p a r e d i t? prepare this? A. Well, al l t h e i n f o r m a t i o n t h a t sh e w o u l d h a v e h a d in 11 t a l k i n g to p e o p l e a n d l o o k i n g t h r o u g h f i l e s a n d 12 t a l k i n g to t h e p r o f e s s i o n a l s a n d so on. 13 487 Q. 14 A. 15 16 17 V e r y well. So, Okay. anyway: "We d o n o t k n o w or w h y t h i s c o m p a n y a p p e a r s to c o m e b a c k i n t o e x i s t e n c e in 197 6 . W e t h i n k t h a t it w a s a n a m e of c o n v e n i e n c e u s e d on a n u m b e r of b a n k a c c o u n t s h e l d w i t h G u i n n e s s & M a h o n in Dublin. 18 19 M o n e y w a s t r a n s f e r r e d to t h e s e a c c o u n t s b y o v e r s t a t i n g the cost of fruit in the books of F I I . 20 22 The p r a c t i c e was d i s c o n t i n u e d in 1979 a n d al l o f t h e a c c u m u l a t e d m o n i e s w e r e b r o u g h t b a c k into the P & L a c c o u n t in 1 9 8 0 a n d w e r e c h a r g e a b l e t o tax. 23 W e d o n o t k n o w w h o a d v i s e d . .." 21 24 25 If a n y b o d y I t h i n k t h e y s h o u l d b e s a y i n g , 26 " . . . i n r e l a t i o n to t h i s s t r u c t u r e . 27 28 29 We have supplied some b a n k statements in c o n n e c t i o n w i t h t h i s p e r i o d of activity. The statements supplied r e f e r to G u i n n e s s & M a h o n C a y m a n Trust. There were o t h e r acc o u n t s on w h i c h 1 2 3 488 Q 4 A 5 489 Q If I c o u l d j u s t McCann? Yes . Then the m o n e y that was t r a n s f e r r e d into IFA came f r o m FII, 6 s t o p y o u t h e r e Mr. 7 A 8 490 Q Right. 9 491 Q MR. is t h a t c o r r e c t ? I b e l i e v e so. JUSTICE COSTELLO: C a n y o u g i v e us a c o p y of t h a t p l e a s e Mr. 10 11 A 12 492 Q 13 A Yes, MS. yes. MACKEY: Yes. I c a n g i v e it to y o u a f t e r w a r d s b e c a u s e 14 scribbling. 15 n e e d it b a c k . 16 493 Q 17 A 18 494 Q McCann? I have been I a m n o t q u i t e s u r e w h e r e -- I t h i n k I So. . . ( I N T E R J E C T I O N ) ? I a m sor ry , Yes. Ms. Mackey. Is it on t h a t b a s i s t h e n Mr. M c Cann that you 19 s a y t h a t FII is t h e b e n e f i c i a l o w n e r of t h e m o n i e s 20 i n it? 21 A 22 495 Q Yes, yes. W h e n yo u sa y h e r e in y o u r s t a tement: 23 "I b e l i e v e t h a t FII w a s t h e b e n e f i c i a l owner" 24 25 d o y o u b e l i e v e t h a t of y o u r o n l y k n o w l e d g e or h a v e 26 your r e s e a r c h e r s . . . (INTERJECTION)? 27 28 29 A No, I d o n ' t h a v e m y o w n k n o w l e d g e o f it. just from enquiries. T h i s is 1 2 497 Q 3 Yes. V e r y g o od . M o v i n g on down to just two paragraphs b e l o w that? 4 A 5 498 Q Yes . Y o u se t ou t h o w t h e f u n d s in t h e s e b a n k a c c o u n t s were applied. 6 7 Do y o u s e e that : "I b e l i e v e t h a t a l l o f t h e f u n d s tran s f e r r e d into these ba n k accounts together with interest earned thereon w e r e a p p l i e d (1 )"? 8 9 10 A 11 499 Q 12 A 13 50 0 Q 14 A 15 50 1 Q 16 Yes, So yes. (1) in the t r a n s f e r of p a r t of s u c h funds to FII? Yes . T h e y w e n t b a c k t o FII a g a i n ? Yes . A n d t h e n i n m a k i n g p a y m e n t to s u p p l i e r s a n d t h i r d l y : " I n m a k i n g p a y m e n t s t o p e r s o n n e l of FII" . 17 18 19 W h a t does that r e l a t e to? A I u n d e r s t a n d t h a t t h a t is p a y m e n t s p e r h a p s of b o n u s e s t o s taf f, 20 21 502 Q 22 A 23 50 3 Q 24 g r o s s w i t h o u t d e d u c t i o n o f tax. W i t h o u t d e d u c t i o n of tax? Yes . W o u l d that be to p a r t i c u l a r m e m b e r s of s t a f f or personnel? 25 A 26 504 Q 27 A 28 50 5 Q 29 A Well, yes. Yes? But I am not sure, I don't know w h o t h e y were. W o u l d it b e a p a r t i c u l a r g r a d e o r l e v e l o f s t a f f ? 1 No. 2 h a v e t o l d us. 3 4 ) t h a t w e l o o k e d at f r o m J o h n F u r z e t o M a r t i n Ke a n e , 4 y o u r e m e m b e r t h e o n e a b o u t t h e w i t h d r a w a l of t h e 5 money? 6 A 7 507 Q 8 A 9 508 Q Okay. Just two t h i n g s in r e l a t i o n to w h a t you In r e g a r d to t h e T e l e x (Exhibit Yes . F r o m FII d e p o s i t ? Yes . H a v e y o u e n q u i r e d f r o m Mr. K e a n e if h e h a s a n y k n o w l e d g e o r m e m o r y of t h i s T e l e x ? 10 11 A 12 509 Q 13 A 14 51 0 Q 15 A 16 I d i d n ' t s p e a k t o him. Yes ? B u t I u n d e r s t a n d t h a t s o m e o f o u r p e o p l e did. Right? A n d I t h i n k he c o m m e n t s o n w h a t it w a s w i t h o u t i n d i c a t i n g a n y k n o w l e d g e o f t h e p a r t i c u l a r one. 17 51 1 Q 18 A Yes ? B u t I t h i n k h e said, "Yes, t h a t is a n i n - h o u s e 19 internal memo," 20 i n f o r m a t i o n to g i v e us t h a t h e l p e d us t o i d e n t i f y 21 it. 22 512 Q Right. a n d I d o n ' t t h i n g he h a d a n y T h a t is v e r y g o od . T hen just one other 23 question: In r e l a t i o n to t h e d r a f t s y o u a r e 24 satisfied, yo u sa y in y o u r statement, 25 n o t r e c e i v e t h e s e fo r y o u r p e r s o n a l u s e ? 26 A 27 51 3 Q 28 29 A b s o l u t e l y not. H a v e you, t h i s r e l a t e s to 1977, personal bank accounts A that you did for 1977? checked your 1 2 514 Q 3 Do y o u k e e p r e c o r d s of y o u r p e r s o n a l b a n k a c c o u n t s going back that 4 A 5 51 5 Q 6 A 7 Yes, far? and going b a c k even ten years earlier. Right? The p e r s o n a l re c o r d s are fortunately, y o u know, very complete. 8 516 Q 9 A Yes. V e r y good. I have not a n y . . . (INTER J E C T I O N ) . W h i c h is n o t -- sorry, w h i c h is n o t t h e c a s e fo r 10 s o m e of t h e c o m p a n i e s t h i n g s b e c a u s e of c h a n g e o f 11 location and one thing and another. 12 517 Q I have not any further questions. 13 Mr. 14 E N D O F E X A M I N A T I O N O F MR. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Thank you McCann. N E I L M c C A N N B Y MS. M A C K E Y 1 2 3 4 MR. JUSTICE COSTELLO: Mr. 5 MR. O'KEEFFE: Judge, McCann? we h a n d e d in the c o n t e n t s of the l e t t e r 6 7 t h a t w e w r o t e i n i t i a l l y to KPMG , 8 MR. JUSTICE COSTELLO: Yes. 9 MR. O'KEEFE: We also h a n d e d in a copy as t h e y a r e now. o f t h e r e p l y w h i c h w e got. 10 11 MR. JUSTICE COSTELLO: Yes. 12 MR. O'KEEFFE: A n d we h a v e h a n d e d in a 13 l e t t e r t h a t w e s e n t to t h e 14 C a y m a n Islands C o mp a n y ' s O f f i c e a nd a g ai n no reply. 15 MR. 16 A 17 JUSTICE COSTELLO: Yes? A n d J u d g e j u s t if I m a y a s k y o u a q u e s t i o n j u s t fo r guidance. 18 519 Q 19 A Yes ? In t h e l i g h t n o w of, y o u know, the q u e stions and 20 answers and the things that 21 about, 22 feel w h e n we discuss, 23 that there m a y be something, 24 h e l p f u l w o u l d y o u l i k e us t o p u t t h a t o n p a p e r to 25 y o u if t h e r e is a n y t h i n g ? 26 52 0 Q 27 Yes. if t h e r e is s o m e t h i n g I f e e l or o u r p e o p l e Mr. situation? 28 A 29 52 1 Q Yes . I have felt und u l y vague McCann, y o u know, what has t aken p lace y o u know, that m a y be we are i n v e s t i g a t i n g this 1 2 522 Q. 3 A l l i n f o r m a t i o n t h a t y o u c a n g a v e us t h a t w o u l d indicate what occurred? 4 A. 5 52 3 Q. 6 A. 7 524 Q. Yes. In this s i t u a t i o n we w o u l d r e q u i r e ? Yes. If t h e r e is a n y f u r t h e r i n f o r m a t i o n t h a t y o u c a n g i v e us p l e a s e d o so? 8 9 A. 10 52 5 Q. 11 A. 12 5 2 6 Q. 13 A. Yes. Y o u c a n s e n d it o n b y l e t t e r t o u s ? Yes. A n d w e c a n c o n s i d e r i t? Yes, a n d i f I m a y just, y o u know, str e s s again, you 14 k n o w -- I a p p r e c i a t e v e r y m u c h t h e c o u r t e o u s w a y y o u 15 are d e a l i n g w i t h the i n q u i r y a nd to say to you that 16 w e at o u r e n d h a v e i n v o l v e d t h r e e m o s t 17 and we will in v e s t i g a t e e v e r y t h i n g that we can and 18 it is t h e i n t e n t i o n t o b e a b s o l u t e l y open . 19 527 Q. 20 A. Yes? A n d the same i n s t r u c t i o n s h a v e b e e n g i v e n to all p e o p l e in t h e o r g a n i s a t i o n . 21 22 senior people 528 Q. Yes. J u s t a p r o p o s of t h a t Mr. M c C a n n : There have 23 b e e n some cases that we h ave c o n s i d e r e d in w h i c h the 24 p e r s o n t h a t w e w e r e i n t e r v i e w i n g had, 25 previously approached and given information by 26 Guinness 27 ca s e s , 28 your case? 29 about this inve s t i g a t i o n until our letter, & M a h o n or s o m e t i m e s the Ca y m a n Islands. from, i n fact, been i n o n e or t w o T h i s d i d n o t h a p p e n in You got no i n f o r m a t i o n f rom a n y b o d y is t h a t 1 A b s o l u t e l y not. 2 3 529 Q 4 A Yes . A n d w e w r o t e to -- we w r o t e to t h e v a r i o u s -- t o a n y 5 a d d r e s s w e h a d a b o u t c o m p a n y r e g i s t r a t i o n a n d so on 6 in the C a y m a n and B e r m u d a a n d Ireland. 7 53 0 Q 8 A 9 53 1 Q 10 A 11 532 Q 12 Yes? A n d we didn't get answers. Yes. Very well? But we ha v e n ' t b e e n a p p r o a c h e d b y anybody. V e r y w e l l Mr. MR. McCann. O'KEEFFE: J u s t J u d g e i n r e l a t i o n to 13 the last ques t i o n that you 14 raised? 15 MR. JUSTICE COSTELLO: Yes? 16 MR. O'KEEFE: I t hi n k that we m i g h t just 17 h a v e to l o o k i n t o the 18 Telex matter, 19 o f t h a t b e f o r e o r af t e r . 20 MR. t h e Te l e x , JUSTICE COSTELLO: No, no. I t ...(INTERJECTION). 21 22 to s e e if h a d w e g o t a c o p y MR. MEGHEN: W e h a d b e e n s e n t a c o p y of 23 the Telex. I cannot 24 r e m e m b e r b y w ho m . 25 MR. O'KEEFFE: Yes. 26 MR. JUSTICE COSTELLO: It d o e s a p p e a r 27 Mr. 28 that Guinness 29 c ertain records. O'Keeffe & M a h o n h a d b e e n a s k e d to p ro d u c e 1 MR. J U S T I C E C O S T E L L O : 2 3 A n d they felt that they were o b l i g e d to ask their 4 clients. 5 MR. O ' K E E F F E : Yes . 6 MR. J U S T I C E C O S T E L L O : For permission. 7 MR. O ' K E E F F E : Yes . 8 MR. J U S T I C E C O S T E L L O : To p r o d u c e t h e s e records. 9 MR. O ' K E E F F E : Yes, 10 MR. J U S T I C E C O S T E L L O : That was one instance. 11 MR. O ' K E E F F E : Yes . MR. J U S T I C E C O S T E L L O : I was wo n d e r i n g whether 12 53 3 Q 13 sure. t h a t h a d h a p p e n e d in t h i s 14 case? 15 A 16 534 Q I t h i n k so. Secondly, the r e p o r t of the A u t h o r i z e d O f f i c e r was 17 m a d e a v a i l a b l e t o t h e r e p r e s e n t a t i v e of " A n s b a c h e r " 18 h e r e i n D u b l i n a n d he h a s m a d e p o r t i o n s 19 r e p o r t a v a i l a b l e to s o m e o f t h e w i t n e s s e s ? 20 A 21 53 5 Q Yes . I j u s t w a n t e d to se e w h e t h e r t h a t h a d h a p p e n e d . 22 V e r y well then. 23 T h a n k you v e r y much. T h a n k you. 24 25 26 27 28 29 of t h a t THE E X A MINATION WAS THEN CONCLUDED ?597 hog??vo 7 cake?? nq air/70..er Miltown Grange Castlebellingliam Co. L o u t h Mr. JusticeDeclan Costello Ms. Noreen Mackey Mr. Paul Rowan Office of theInspectors Third Floor Trident House Blackrock Co. Dublin Dear Sirs & Madam, MdCQUBJUiiK, . Irefertoyour letterof20* January. As requested, Isetoutbelow a statementofallofmy dealingswhetherdirector indirectwith Ansbacher (Cayman) Limited formerly known as Guinness Mahon Cayman TrustLimited, Ansbacher Limited and Cayman International Bank and Trust Company Limited (the Company). Ihave conducted orhavehad conductedon a y behalfan extensivesearchof all records in my custody or power or in the custody or power of Fyffes pic in relation to the matterswhich arethesubjectofyourletter. Ihave alsomade or caused tobemade enquiries ofpersons whom Ibelieved could be ofassistanceinenablingme toprepare thisreply. The enquiriesmade on my behalfincludeda letterofrequest to the Company [EX1] seeking any information or records held by ithowever no response to this requesthas been received to date. ImakeThis statementon the basisofsuch records and informationas have been disclosedby the searches referred to above, on the basis of such limited recollection as I have of the relevanteventsand circumstanceshaving regardtothepassage oftime and on thebasisofthe documentation referred toherein and enclosedherewith. For ease ofreferenceIhave dividedmy response tothe questions raisedby you inAppendix C into two parts. PartA dealswith thepersonal affairsofmyselfand my wife includingany companies controlledby eitherorbothofus and PartB dealswiththeaffairsofFyffesPic (of which Iam Chairman), itssubsidiaries from time to time and itspredecessors. I have been a long-standing client of Guinness & Mahon Limited (the Bank) where I maintained and continue to maintain a small current account (my principal account being maintained with AIB). I startedmy relationship with theBank during the 1971 bank strike. From time to time I invested some funds with the Bank in accounts which were atallti™*? designated "residentaccounts". /•-v ) Question (I) ‘ Iam advised and believe thatIam entitledto answer this question in the negative because I do not believe that Icaused a Deed ofTrust to be executed and transferred money or other assets to such a trust. However, 1 attach a filecopy of an undated letterwhich appears to . have been sentby me to Guinness & Mahon Cayman Trust Limited [EX2]. This letterwas obtained from the filesofmy advisors SKC, now known as KPMG, arisingout ofa search conducted at my request for the puipose of enabling me to furnish this reply. This letter constitutes the only documentation inmy custody or power in relation to Guinness Mahon Cayman TrustLimited and itspossible involvementinmy personal affairs. 1have no further 'informationor recollection on who may have advised inrelation to the establishment of the trustor as towhether itwas ever actually established. From thisletteritwould appear thaton 31 March 1972,1may have caused a settlementfor thebenefitoftheissueofmy parents, thelateChaiies and RosettaMcCann, to be createdby John Andrew Furze who appointed Guinness & Mahon Cayman Trust Limited as trustees. Notwithstanding the reference toMr. Furzeintheletter1have no recollectionofeverhaving heard of Mr. Furze until the public disclosure of his name in relation to the McCracken Tribunal. Inever met him. ^ . i The letter suggests that the trust, ifestablished, may have owned the share capital of Blue Limited. I recollect nothing about Blue Limited and have not been able to obtain any informationinrelationtothiscompany despiteenquiriesmade on my behalfwiththeRegistrar ofCompanies inGrand Cayman [EX3] and searchesconductedattheCompanies Registration Office inDublin. From the letter it would appear that the trust’s interest in Blue Limited was disposed of. However apartfromtheinformationsuppliedaboveIdo nothave any furtherormore detailed responses toyour questions 1 (a)- to- 1 (g)inrelationtotheforegoing eventswhich occurred almost thirty years ago. In particularmy recollection and thatof my advisors atthattime, SKC, isthatifthetrustwas everputinplace, Ineversettledany assetsor transferredany cash to such trustand thatthe trustwas neverused. • Question (2) 1 did not avail of the service described. Question (3) Idid not availof the service described. Question (4) Idid not avail of the service described. Question (5) Idid not avail ofthe service described. Question (6) See reply at(1) above. Question (7) Idid not avail of the servicedescribed. Question (9) See reply to (1) above. PARTB Fyffes pic is an Irish publicly quoted company of which I am currently a director and the chairman. Icontrol approximately 10% ofFyffespic. Fyffespicwas incorporated in 1980 and acquired the fruitdistributionbusiness previously carried on by another Irishcompany FruitImporters ofIreland Limited which was incorporated in 1968. Isetout below my responses to the specific questions raised dividing my response between Fyffespic and FruitImporters ofIrelandLimited Fyffes pic . In all cases the response is given in relation to Fyffes pic and each of its subsidiary or associated companies. Question (1) Fyffes pic did not avail of die service described. Question (2) . Fyffes pic did not availofthe servicedescribed.' Question (3) Fyffes pic did not avail of the service described. Question (4) Fyffes pic did not avail of the servicedescribed. Question (5) Fyffes pic did not avail of the service described. 3 Question (6) . Not applicable. Question (7) fyffespic did not avail of the service described. Question (8) None. . . . . Fruit Importers of Ireland Limited Inallcases theresponse isgiveninrelationtoFruitImporters ofIrelandLimited and itssubsidiary or associated companies ("FII"). This company ceased trading in 1980. of FII had dealings with two Cayman Island companies in the early 1970ies, namely Paris InvestmentsLimitedand InternationalFruitAgentsLimitedwhicharedealtwithinmore detail below. The Company held the shares in Paris Investments Limited in trust for the shareholders ofFII. Apart from thisIam not aware ofairyconnection betweendieCompany and these two companies atthattime. Inparticular Ido not know whether thesecompanies orany oftheirassetswere managed faydieCompany atthattime and accordinglyitisnotclear whether these companies are covered by the terms ofyour letter.. - Paris Investments Limited A Cayman company called ParisInvestments Limited (Paris) was establishedin 1972 and it was referred tointhefinancial statementsofFruitimporters ofIrelandLimited forthatyear. Iattach a copy of the saidfinancial statements in which reference to Paris appears on pages 5 and 8 [BX4]. Paris was established to acquire the share capital of two Bermudan subsidiariesofFII,namely InternationalFruitShippers Limited and FruitExportersLimited. Ibelieve itislikely thatthese companies were acquired at nominal cost by Paris from FII. During the year to 31* October 1972 International FruitShippers Limited,was acquired and subsequendy disposed ofas a subsidiary and thereforewas not listedas a subsidiary as at31“ October 1972. I believe that these two companies were liquidated and the proceeds of liquidation were used by Paris to subscribe fornew shares in FII: Paris was subsequendy liquidated and the shares inFII were distributed inspecieto the shareholders ofFII.. As thistransactionpre-datedtheCorporationTax Act, theCapitalGains Tax Act and the 1974 FinanceAct 1have been advisedby K P M G thatthetransactiondoes notgiverisetoany Irish taxexposure for the companies involvedor for the shareholders inFII. - International Fruit Agents Limited FIIacquireda subsidiarycalledInternationalFruitAgentsLimitedincorporatedintheCayman Islandsduring theyear ended 31.October 1972 though itmay not have caused thatcompany to be established in the first instance. Its share capital was Cy$100. It was listed as a subsidiary atpage 11 ofthe financial statements ofFIIin thatyear a copy ofwhich issetout in [EX4]. The company was involved in the buying and selling of fruit and received commissions for these activities. In March 1974 die company was sold. I attach a copy of the sale agreement [EX5]. Notwithstanding the said sale it appears that non-resident bank accounts were maintained with the Bank in the name of International Fruit Agents from October 1976. to approximately October 1980. 1believe that FII was the beneficial owner of the funds in these bank accounts. A numberof documents relating to certain of these accounts refer to the Company and copies of these documents are attached [EX6]. I am not aware of what, if any, service was provided by die Company in relation to these bank accounts. I believe that all of the funds transferred into these bank accounts together withinterest earned thereon were applied (1) in the transfer of part of such funds to FII from 1976 to 1980 in circumstances where FII believes that the said amounts were brought into the P & L account of FII for the relevantyear and accordingly wouldhave formed part of the profits liable to tax for that year; (2) in making payments to suppliers from November - to - December 1976 and March- to -June 1979; (3) in making payments to personnel of IpCT; and (4) in discharging bankcharges andother costs. Despite extensive enquiries no closing statements for these bank accounts have been located nor are there any accounting records available reflecting the closure of these bank accounts. Full disclosure of relevant facts has been made to the Revenue Commissioners. I am advised and believe that any Exchange Control consents required in respect of Paris Investments Limited were sought and obtained by the Bank. I attach a copy of a letter from the Bank to Story & Phelan, Chartered Accountants, dated 19 October 1972 [EXT]. I do not know whether Exchange Control consent was necessary or obtained in relation to the transactions undertaken by International Fruit Agents described above. Other Guinness and Mahon Limited have supplied me with a copy of a telex [EX8] which refers to a dollar deposit in the name of FII containing, at the relevant time, $29,927.54. The fact that John Furze was the author of the telex and a handwrittenreference to "GMCT file" appears in the top comer suggests a link between the account and the Company. The telex refers to die debiting "ofthe sundry sub company account" andahand-writtennote indicates thattwo drafts for the total amount ^ the account, after deducting a number of expenses, were made payable to me. I have no recollection of receiving these drafts. No reference to this account has been located in what remains of the records of FII. Having enquired of a former employee of die Bank I am advised that the references to the "sub-company "account and to replenishing the account refers to an inter-bank account between die Bank and the Company. I have carried out or have had carried out an extensive review of all of my personal bank accounts and financial affairs and I am satisfied that these drafts were not given to me for my personal use. Kennedy Crowley & Co. Cliartered Accountants H a r c o u r t H o u s e H a r c o u i t Street D u b l i n 2 T el e p h o n e (oi) 75 7 9 7 1 T e l e x 4 4 9 4 Vincent Walsh, Esq., Arthur Cox & Co., 42, St. Stephen's Green, Dublin, 2. i.; AJS/BE . . * 5th January, 1973. ted. White and Blue Trusts Dear Vincent: Th ree Dracxetlonary Trusts va?e .sat ^up ift t^ei.Caygian early in, White and Blqfc arlalng front Earl-Houae Limited or, Ea,rl;-^quaa j^^eatanaiat;f^t»lt*d . .. shbbld flow th roughjocal ^nvasiajants v^tg; ''fu n d f o r ' t t i e b fe n e fit o f . y o u r .'c h il'd r e h ..• * . : % . £ • -vC""I n / a d d itio n -isp :the aforem entioned ;T r u s t .B»6d? ' ^ .s t f i-a l s d ‘ h o ld in g v ? a f u r t h e r Deed made bn th e 7 th o f November 1972 .whereby th e pow ers g ra n te d t o t h e S e t t l o r u n d e r t h e t e rm s * o f’C la u s e 8 ( a ) o f t h e T r u s t Deed have been ir r e v o c a b l y g ra n te d t o V in c e n t W alsh E s q . o f A r t h u r Cox & Company, s o l i c i t o r s , 4 2 , S t . Stephens G re e n , D u b lin 2 , o r i f th e s a id V in c e n t Walsh s h o u ld be deceased, t o th e s e n io r p a r t n e r f o r th e tim e bainfc i n th e s a id f ir m o f A r t h u r Cox and Company. JA F th r E*V& V E X H IB i . IT 2 ■ ■ H i l t o n Gnugt, C Utl tbll Co. Loath. Xha Biroctora, . . Gulxmass & Mahon Cayaan Trust Lialtad, P.O. Boat 887, , Grand Cayman, British Vaat Indiaa. D m * Sirs, ' • . ' I rafar to a Doad of 8attlaaant datad Slat March, 1972, vharaby John ' Andranr Txarm appoint ad Goianaaa and Hahon Cayman Troat Llaitad aa Truataea of a SattlaaMnt for th« banafit of thaiaaua of tha lata Charlas MeCaxm and Itoaatta KeCaon. * ’ In thair capacity as Trustaas, Goianaaa A Mahon Caynan Treat Liaitad, through thair noaiiuwa o n tha antira laauad ahaxa capital of Blua Liaitad. I haraby authorlsa you to tranafar at par to Hail Collins or1his noninea tha antira laauad’ahara capital of Blua Liaitad. Youra faithfully, E X H 1 Stokes Place St. Stephen's Green Dublin 2 Ireland Te. Fax Internet ~ IB IT 1 ........................ +383 1 4 1 2 1122 www.kpmg.le Mr M ichael Meghen Arthur Cox & Co Solicitors Earlsfoit Centre Earlsfort Terrace Dublin 2 Our ref sm/ep/162102 11 May 2000 DearMichael . NeilV McCann I refer to die undated letter marked “Exhibit 2 ” which was enclosed with Mr McCann’s letter o f March 2ndto the Inspectors. ' . I was on the staff o f Kennedy Crowley in 1972. It is my recollection that die trust referred to in the said letter and the company, Blue Limited, wexe established as a tax planning measure to be available if and when profits arose from various property transactions. It is also my recollection that the trust and Blue Limited wexe never in fact used and were dissolved in due course. I have no documentary evidence to support m y recollection o f these matters. Yours sincerely Sean M ooney Jawma Kwiwdy • D M lam • N M ik M • AnyNaan • Maaauw • GolmCMm Mn CatfM • NmI Osaka • CMwfMr Mm • Mu OMr • Mi OTtay • Mbait Ota MutOatois • Pul May • ftunm itr • SoMnoM • O M ltam • KcNriOaoiga IHaUMMteaa •W »M ii li • % M m •OanMKaam* •MutaaMaOw •PMMcOanan Namk MantwN • Jk» MMnm • Oton* Muaan • 3hwi Mvpky • Pn Olikn Oanta O'Cofncx > Knki ODwnu • Saw O'Kaala • Itoma CKawta Milan HaMaion • Jalia RaeHa * Hmy twKa • Saamua l»aWa • Site WMan nctwtf WMm • fWxn Waada ■ Cananmm fauiMct«on» atiar tm dwtand AtxturMt. Mbanlaflar > fcanMaanar • f W » « a > * 0aii: Conor McDonniill Patrick McGovlrn Grainnl Uln' ni^sy Siamcs Givln Colin Byrnh CAROTIN!DliVIIN ClARANHoUJIiR C.RIX'.ORYGl.YNN DaVII)FoILY SILHILN1ll-V-AtfITDl-ICIANDKISLVNH SARAHClNNIIT KATIIIJ-liNGaRRI-HT PAt>RAIC.O RfORDAIN I)K.MaRYRitDMONI) I;i.izaiii;tii Boimvii.i. Nia. mii Bvkki: W illiam Day Ani>ri\x’Llnny John Mlnton Patrick OBKiiiN Oria O'Connor Brian O’Gorman Mark Sapndlrs Rcvd 12/21 05:13PM (0 1 . 2 1 /1 2 /0 1 , 18O:2 0 rt,1Ur C°* l ' ne 11 f o r MMEGHEN Your ref: C/M03PNSP. 21 D e ce m b e r 2001. H is Honour Judge Sean O’Leary', Ms. N oreen Mackey B .L Mr. Paul Rowan F.C.A. Mr. M ichael Cush S.C. O ffice o f the Inspector o f Taxes, 3rd Floor Trident H ouse, Blackrock, Co. Dublin. P rivate Bt C O N F lD E N T I A l. D eaf Sin, The attached Replying Statementis made in response to the preliminary coodoaons expressed in you* letterof 20th November 2000 in relation to myself. I referto the paragraphs as numbered in your letter. If necessary I am prepared to give further evidencg-W substantiate the matters set out in my accompanying statement Yours sincerety. REPLYING STATEMENT OF NEIL V. MCCANN TO INSPECTORS (i) Around 1975 my wife and I controlled, directly or indirectly, 57% o f the shares in FII. FII was an unlisted public company with many other shareholders. The Board (in addition to myself) comprised independent directors, some o f whom were the representatives o f other significant shareholders. Note: These facts are relevant to illustrate the Board comprised independent persons and was representative o f many shareholders. 2. 3. (ii) The second last sentence in paragraph 1 commencing with the words “In 1972, FII acquired........... ” has no bearing on the facts or inference and should, I suggest, be deleted. (iii) The last sentence in paragraph 1 is factually incoiTect The facts are: T ie Company Fruit Importers o f Ireland Limited ceased trading in 1980. Its trade and assets -were transferred to a new and previously unconnected company, FII pic, which in 1986 purchased Fyffes and subsequently changed its n^me to Fyffes pic. (i) I repeat I have no recollection or knowledge in relation to the undated copy letter to which you refer. I do not believe I ever signed the original o f such a letter and it is significant that no original signed version exists. As noted by me already this copy letter only came to light from files which had been maintained by SKC. Whilst they were my financial and taxation advisers, there is no certainty the letter was ever sent by me to GMCT. (ii) The hand written notes on the copy letter sent by you to me are in fact mine, having been written by me in February 2000. (i) The letter dated 28 December 1972 from Mr Furze addressed to me was in feet sent to SKC. The Inspectors, in paragraph 4, accept that no assets were ever transferred to the Trust (and refer to the letter of Mr Sean Mooney o f KPMG). This last fact confirms my belief and my evidence as already given to the Inspectors. In the light o f this finding by the Inspectors I contend that the finding in the last sentence in paragraph 3, namely “it is clear........... that he still had an interest in the Blue Trust at that time”, is clearly incorrect in fact and contradictory to the findings in paragraph 4, to which I have referred, namely that “no assets were ever transferred to it”. (ii) I am also advised that as a matter o f law I did not have an interest direct or indirect if in fact no assets were ever transferred to the Blue Trust. (i) As far as I can recall I never arranged for or permitted the establishment o f the Blue Trust. Moreover I cannot accept the conclusion o f the Inspectors that having determined that no assets were transferred by me to the Trust, that the role o f GMCT constituted the “carrying out o f business” for me by GMCT. M r Mooney also states in his letter that the Trust (is . the Blue Trust) and Blue Limited wers never in iaet used and were dissolved. (ii) As already stated I received taxation and financial advice from Kennedy Crowley at the lime. Transactions suck aa the establishment o f a Trust with an associated company were part o f the tax planning measures o f the time. This has been confirmed to me by XPMG in a letter dated 21* December 2001 a copy o f which 1 attach. I at all times acted in accordance with such advice. It is, I suggest, appropriate to refer to such facts, if the inspectors are to conclude that GMCT carried out business for me so as the context can be fairly understood. 6. Conclusion: Having regard to the potential impact o f your findings on my good name and reputation 1 also request the substantial restatement and redrafting o f paragraph 6. If the Inspectors accept my submissions in relation to paragraphs 5 and 6, then 1 submit having regard to the potential adverse affect on my reputation o f any remaining findings o f the Inspectors (howsoever slight) that the Inspectors should in accepting that no assets were ever transferred to the Trust by me exonerate me and exclude any such finding. Alternatively any findings o f the Inspectors should protect firstly my reputation as at all times I acted properly on accepted legal and taxation advice. 12/21 12:19PM (00:36) on Arthur Cox tine 02 for MMEGHEN 2 \ •Dec• 2001 !2:32 UORKSRV2 printed FAX3C23290671CA on 12/21/2001 12:23PM No•2173 P. 2 Pg Chartered Accountants 1Stokss Place St.Stephen'a Green Dublin 2 Ireland Mr Michael Meghen Arthur Cox Solicitors Earlsfort Centre Earlsfort Terrace Dublin 2 Telephone +3S3 1410 1000 Fax +3S3 1412 1122 Internet www.kpmg.ie Our ref *Wbh/2553a2 21 December 2001 Dear Michael Re: Neil V. McCann Thank you for your letter dated 11 December 2001 addressed to Jerome Kennedy, who has asked me to reply. Trust arrangements, such as those set up in relation to the Blue Trust and the underlying company, were a framework within which profits arising from property development might accumulate for the benefit of beneficiaries. This was a type of taxation mitigation arrangement prevalent at the time and, to the best of my recollection, such an arrangement was in accordance with Irish law at the time and had been so opined upon by leading Counsel of the day. Yours sincer* Alexander K. Bums Partner Finn Ed'cVVfc)lao« RtChafdWlwlan • DividWilkirt«oi\ « RobertWoqiH » taruutwtci i^uSlificaoonao ttitf Ctwwwd AccoufltiMMV. ftcfttrt * $»an Moofi*y • im Young * * * ■ W(wtC ortina Appendix XV (165) Mr Philip Monahan 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Philip Monahan. a) Letter of 5 January 1973 Kennedy Crowley Co to Mr Vincent Walsh of Arthur Cox Co. Kennedy Crowley & Co. CharteredAccountant* Haroourt Home Hucoutt Straet Dubfin 1 Tdrphoo* (01) 747971 Telex44M AJ8/B* Vincoat W*l*h, Xwj., ArtJwr ftoe * Co., 42, St. fitojhon'* Q**oa» Dnblin, 2. 5th Jooujr, 1973. g « u Vlaoanct T n u t t ii V k t t m . and Bta* VvcV "- " i i t e - U ^ « M U N U a l f d * a L ajaylfe • r• MuftLd o . v w * • * rl^ :■••■ ,>a w,/. v ^ . v Atiuudi/Btoeosopjr ©fr l o t t o * ,■•. ^ t.......; .: b ? y •:•■ ■ . j u i b A k c q m * t m a t .i»r,'JLn;« w p ^ t i w , j ^ e h .,; ••>.•v -:.V ”: V i*>fc«otl*l b*H*fioi#xy., •■ .k! :•••• •'■irHLtt^ ^ >JWUT,lldC««k. »a*:JW.Wp v-.^W..*.^:' •: ' tto,poUri roforrod to is X m ? p « $ H P ^ ffctdi h * f booa • ; " - I*r«rt>c*bly gxaattd ta y«u *r» th* paw*** « t t i«,Socelor, th* .. .. prlnolpol power boiag tho pooor to roplooo-th«Tjnutooo. Xho Sattiov w « a Ca y n Loayor. . . . I hop* that this will bo in ordox vithyoo «nd should yea roqplxo •ugr finrtfco* Information, or * oopgr of tho original docu— ata, plaaaa lot on know. ’ ♦ With ovosy toed «Uk, . ' ' Yoora olaooroly, Alox. Spain, oot so il v. McCatm, Saq.1' / fhillp Nraahan, Iif. ' . V " Appendix XV (166) Mr Alex Spain 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Alex Spain. a) Letter of 5 January 1973 Mr Alex Spain to Mr Vincent Walsh. ^ Kennedy Crawley & Co. ChirteredAccountant* Hircourt House Harcoutt StreetDublin S Tskpfaooe (oi) 75797lTd«4484 Viaooot Volah, *»!•. i s d w O n A Co., 42. se. 8 w t h « U a m a , Dahlia, 2. AJ*/SI . ___ 1OTS 5th J « « * 7 . O u r Tlatnt! . ' V M - ' - rt t o W r mito. ood * b * f W W f c - J t o o o o Uaitod ttlftte. * * * U n& U ttw 4 a i* o O !^ ‘3 0 e * lX jm titW tn tt * * * '-•.■'■•./•• M V S .' ' ; ’ # ii 'M ,»c E*V»iv;r<3<-‘'.-A > .-jv'' s r * » t t ^ :#6tttsopr oft ■. - T :?.lv ••■• ’'-ltikh&0 Csfrjpi.tfJsost-Ltd.;' l*v ■'.V- •"re**t>fcoofct*l b000«t0 U*y. : V~« ■.=■! •'•■:• wxlfcMto X * x t ‘W A K M t t m M v & r W M •. i n # ¥ -:• ’“K •’■■• .?4a*.v^a-.i.w.y v..O;;i tto'pooincb roforrod to In tfeo.Ust p u g t M # i U A luevft boon • ; it*Wbc«blr gxootod to you *s» «ho pony*#-olet$o.lottlor, tho ... prlaoipol powor boln* tho powor to ropUeo^ tho, T*u*tOO*. tho {Bottler w i o Capua U q r W t ... ■ X hopo that this will bo is ordox vith. you sad ahocld j n roqpixo oap fosthot iafauotloa, ok o oopjr of Cho o d g & M l (loa w snfs. ploooo lot in tag*. ' < With ovoxy good vMh. Yoozs olaooxoly. Ales* Spain. aot soil V. MoOsaa, * M . ^ Ihllip Manahoa, Isq. •:. V . 11;. Appendix X V 1. (167) M r V i n c e n t F e r g u s o n Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Vincent Ferguson. a) Transcript o f evidence o f Mr Vincent Ferguson dated 23 February 2000. b) Letter o f 2 March 1992 - JA Furze to JD Traynor. c) Letter o f 15 October 1992 - JA Furze to JD Traynor. d) Letter o f 27 May 1993 - JD Traynor to Vincent Ferguson. e) Letter o f 31 December 1986 - JA Furze to JD Traynor. f) Letter o f 13 February 1990 - JA Furze to Ascot Holdings. g) Letter o f 23 April 1987 - JD Traynor to Vincent Fergsuon. h) Letter o f 4 September 1987 - JD Traynor to JS McCarthy. i) Letter o f 28 May 1990 - JD Traynor to JS McCarthy, j) Letter o f 28 May 1990 - JD Traynor to JS McCarthy. k) Unsworn statement o f Vincent Fergsuon o f 11 February 2000. UNDER OATH ON WEDNESDAY, 23RD FEBRUARY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. VINCENT FERGUSON Represented by: MR. SIMON McALEESSE MATHESON ORMSBY PRENTICE 30 HERBERT STREET DUBLIN 2 1 2 3 4 5 MR. JUSTICE COSTELLO: Mr. Ferguson, we will start the interview. 6 I am 7 Declan Costello and on my right is Ms. Mackey and on 8 my left is Mr. Rowan. 9 MR. FERGUSON: Yes. MR. JUSTICE COSTELLO: We are the Inspectors 10 appointed by 11 12 The High Court as you know. 13 MR. FERGUSON: Yes. 14 MR. JUSTICE COSTELLO: What we have made clear to witnesses is that, of 15 16 course, if they have a problem about questions that 17 we ask and they want legal advise they can consult 18 their legal advisor. 19 advisor wants to mention something to their client, 20 we will stop and allow that to be done. 21 MR. FERGUSON: Right. 22 MR. JUSTICE COSTELLO: Would you now take the Similarly, if their legal 23 oath, which we will ask 24 Ms. Cummins, our solicitor, to administer to you. 25 26 27 28 29 1 2 3 4 MR. McALEESE: I suppose I should at this 5 stage say, Judge, once 6 again, that I am the solicitor for Mr. Ferguson. 7 MR. JUSTICE COSTELLO: Yes, yes. 8 9 MR. FERGUSON WAS EXAMINED, AS FOLLOWS, BY 10 MR. JUSTICE COSTELLO: 11 12 1 Q. MR. JUSTICE COSTELLO: 13 could briefly outline your 14 15 Mr. Ferguson, perhaps you career for the purposes of the record? A. Certainly, Judge. I am a certified accountant. I 16 have worked in business all my life. 17 practising accountant as such. 18 Sligo, where I was born, as a clerk in a builders 19 providers. 20 qualify as a certified accountant over the years. 21 went to London in 1958 for experience and was there 22 two years. 23 company called M.J. Boylan. 24 there I went to an American company, Warner Lambert, 25 who were situated in Deansgrange. 26 2 Q. 27 A. I was never a I started work in I undertook a correspondence course to I I came back to Dublin to work for a After a year or so Yes? From there in 1964 I went to the Irish Sugar Company 28 as a management accountant. 29 1969 to join Allied Irish Investment Bank, which is I left that company in 1 a merchant bank set up by Allied Irish Banks. 2 there a year and a half when we set up our own 3 company with my partners at the 4 Leonard and Tony O'Reilly. 5 called Fitzwilton Securities, which was designed to 6 be an investment holding company. 7 3 Q. 8 A. 9 I was time Nicholas We set up a company Yes? We borrowed money from The Ulster Bank at the time and went on a series of acquisitions of various 10 companies in Ireland. 11 quite a successful company for a period and 12 eventually we acquired W.H.M. Goulding & Company, a 13 fertilizer company, which was a public company at 14 the time. 15 further other companies over the years. 16 4 Q. 17 A. 18 That developed and grew into We then ran that company which acquired Yes? That company was called Fitzwilton from 1972 onwards. 19 5 Q. 20 A. Yes? During the period of that company's expansion we 21 fell on hard times in the fertilizer business 22 following the oil crisis of the mid 70's. 23 realise quite a lot of our investments. 24 held investments in Independent Newspapers. 25 started an oil company called Atlantic Resources and 26 I retired from that company in, I think, 1987. 27 remained a Director until it was acquired recently. 28 I am a Director of Independent Newspapers. 29 6 Q. MS. MACKEY: Of which? We had to We then We I 1 2 7 Q. MS. MACKEY: 3 4 You are a Director of which? A. 5 Independent Newspapers. MS. MACKEY: 6 A. 7 8 Q. Yes. Independent News & Media, is its new name. MR. JUSTICE COSTELLO: 8 Just so that I understand, Fitzwilton is a completely 9 separate company to Atlantic Resources, is it? 10 A. 11 9 Q. Absolutely, yes. Is it the investment company which you and 12 Mr. O'Reilly and Mr. Leonard had started, or is this 13 the holding company of these other companies? 14 A. 15 10 Q. 16 A. Well, it made investments in other companies. In other companies? Yes, I mean the first investment was a small public 17 company in Dublin called Crowe Wilson, which was in 18 the textile business. 19 11 Q. 20 What is the name of this company which is the investment company? 21 A. Fitzwilton. 22 12 Q. Fitzwilton? 23 A. 24 13 Q. 25 Yes. Fitzwilton made investments then in Atlantic Resources, did it? 26 A. 27 14 Q. 28 A. 29 15 Q. That's right. Was it a subsidiary then? No. Of Fitzwilton? 1 No, no. 2 it. 3 16 Q 4 A 5 17 Q 6 A 7 18 Q 8 A 9 19 Q 10 A 11 20 Q 12 A It was that Fitzwilton were shareholders in Yes ? Other people became shareholders as well. Yes. You were a Director then of Fitzwilton? Yes . You were a Director of Atlantic Resources? That's right. Are you still a Director of these companies? No. When did you cease? Well, Atlantic Resources was taken over by a mining company, Arcon. 13 14 21 Q 15 A Yes? I don't exactly know when. 16 early 1990's. 17 stage. 18 22 Q 19 A I ceased to be a Director at that Yes ? Fitzwilton was acquired by the O'Reilly Family Interests. 20 21 23 Q 22 A 23 24 Q 24 A 25 25 Q Yes? In 1998. Yes ? I ceased to become a Director at that stage. Yes. I want you to tell us about your relationship with Mr. Traynor? 26 27 I think it was in the A Well, I met Mr. Traynor originally -- one of the 28 investments that Fitzwilton had in the early 1970's 29 was a share in New Ireland Assurance Company. We 1 acquired a 20 percent interest in New Ireland 2 Assurance Company in the early 1970's and 3 Mr. Traynor was a Director of New Ireland. 4 met him at that stage. 5 26 Q. 6 A. 7 27 Q. Yes. So, I Did you have a business relationship with him? No, no. When did you have your first business relationship with him? 8 9 A. 10 28 Q. 11 A. 12 29 Q. 13 A. 14 30 Q. 15 A. 16 31 Q. 17 1984. What was that? That was a loan that we made from Guinness & Mahon. Yes. Could you tell us about that now please? We borrowed money from Guinness & Mahon. Who is "we"? Mr. Jim McCarthy and Mr. Neil Collins. Yes. I want you to tell me in detail the conversations you had and where they took place? 18 A. 19 32 Q. 20 A. 21 33 Q. 22 A. 23 The conversations I had? Yes? Where, with Mr. McCarthy and Mr. Collins? Yes? They had had previous dealings with Guinness & Mahon. 24 34 Q. 25 A. 26 35 Q. 27 A. Yes? I hadn't had previous dealings with them. Yes? I knew Guinness & Mahon in the old days when a man 28 called Bill Forwood and John Guinness were the 29 joint Managing Directors. I worked, as I said, for 1 Allied Irish Investment Bank and I had commercial 2 dealings with them on behalf of the bank. 3 36 Q. 4 A. 5 37 Q. Yes? 6 A. Yes. 7 38 Q. With Guinness & Mahon. I want you to tell me, did negotiations take place with Mr. Traynor about the loans? 8 9 Yes? A. 10 Yes, I didn't actually partake in the negotiations directly myself. 11 39 Q. 12 A. 13 40 Q. No? 14 A. No. 15 41 Q. 16 You did not meet Mr. Traynor at all, did you not? No, not at that stage. Tell we what you were told? Was it Mr. McCarthy and Mr. Collins you saw? 17 A. 18 42 Q. 19 A. 20 Yes. Tell me what they told you? They told me that money would be available from Guinness & Mahon to buy shares. 21 43 Q. 22 A. 23 Yes? On terms that other banks wouldn't be ...(INTERJECTION). 24 44 Q. 25 A. 26 45 Q. 27 No, I want you to tell me, Mr. Ferguson? Sure. Mr. Ferguson, I want full details of this transaction? 28 A. 29 46 Q. Right. Completely full details? 1 2 47 Q 3 A 4 48 Q 5 A 6 I understand. Very well? Yes. All I can say is what I remember from the time . 7 49 Q 8 A 9 Yes? My memory at the time was that Mr. McCarthy and Mr. Collins had had previous dealings 10 with Guinness & Mahon. 11 money to invest in Atlantic Resources shares. 12 already very heavily borrowed with the ordinary 13 banks. 14 50 Q 15 16 We were trying to borrow I was Mr. Ferguson, would you just tell me what was said and what you understood the arrangement was? A I understood that money was available from 17 Guinness & Mahon, as a bank loan, to purchase shares 18 in Atlantic Resources. 19 51 Q 20 A Yes? And the conditions were that shares would be held as 21 security and that a personal guarantee would be 22 required. 23 52 Q 24 A 25 53 Q 26 A 27 Go on? And that was implemented. No. I want you to tell me what the arrangement was? The arrangement was that a loan was being made available to us. 28 54 Q 29 A Yes? I thought collectively at the time but it turned out 10 1 to be separately to each of us, that the loan was 2 made for the purchase of the shares. 3 would be purchased and would be held as security by 4 the bank and that a personal guarantee would be 5 required as well. 6 available from any other bank. 7 55 Q. All right. 9 A. 10 56 Q. 11 A. 12 57 Q. 13 A. 14 I want you to tell me what happened The loan was implemented. Tell me what happened? The shares were purchased. How do you know and by whom? I had dealt with Guinness & Mahon in the previous ten years. They were a reputable merchant bank. 15 58 Q. 16 A. Guinness & Mahon. 17 59 Q. Guinness & Mahon? 18 A. 19 60 Q. 20 A. Yes. 21 61 Q. Yes? 22 A. 23 Who purchased the shares? Yes. You were told that? Well, I assumed that. I mean because we were dealing with Guinness & Mahon. 62 Q. 25 You assumed that Guinness & Mahon had purchased the shares ? 26 A. 27 63 Q. 28 A. 29 Now, these terms were not then? 8 24 The shares Yes. The Irish company? Well, the Irish company through a subsidiary or through a nominee account or whoever. 1 64 Q. 2 A. 3 65 Q. 4 A. 5 66 Q. 6 Did you know? No, I didn't know. Did you make enquiries? I didn't make enquiries. Continue, what happened then? shares. 7 A. 8 67 Q. 9 A. 10 68 Q. 11 A. 12 They purchased the How did you learn that? They informed us. Who did? I presume Mr. Traynor did. You were not told by Mr. Traynor? I don't recollect being told by him but I knew that ...(INTERJECTION). 13 69 Q. 14 A. 15 70 Q. 16 A. 17 Could he have told you? Pardon? Could he have told you? He could, of course, certainly, yes. He could have told me but I don't remember him telling me. 18 71 Q. 19 A. 20 72 Q. 21 You do not remember him telling you? No. If he did not tell you, then Mr. McCarthy told you or Mr. Collins told you? 22 A. 23 73 Q. 24 A. 25 Yes. What did they tell you? They told me that the loan had been approved and was available and shares had been purchased. 26 7 4 Q. 27 A. By Guinness & Mahon. 28 75 Q. By Guinness & Mahon? 29 I didn't know. By whom? 1 7 6 Q. 2 shares ? 3 A. 4 77 Q. 5 A. 6 78 Q. 7 A. 8 79 Q. 9 A. 11 80 Q. 12 A. 13 81 Q. 14 A. 16 82 Q. 17 A. 18 Yes, on our behalf. On your behalf? Yes. What about the registration of the shares? Who I presumed I would be indirectly. No, no? Yes. However, you would not be -- I am talking about the Who would be on the share register? The nominee company. Who was what? Which I understood later was a company called Coral Reef. 19 83 Q. 20 A. 21 84 Q. 22 A. 23 85 Q. 24 A. 25 86 Q. When did you find that out? Sometime after the event. How long after, Mr. Ferguson? I can't honestly say. I would say weeks. Weeks? Yes. So, weeks later you had understood a nominee company... 26 29 Yes? share register. 15 28 Absolutely, yes. would be registered as owner of the shares? 10 27 You thought Guinness & Mahon had purchased the A. Right. 87 Q ...... called Coral Reef Securities? 1 88 Q. 2 What did you understand that was? Did you know where it was registered? 3 A. 4 89 Q. 5 No, I didn't. Yes, I know. I assumed it was a nominee company. However, did you know where it was registered? 6 A. 7 90 Q. 8 No, I didn't, no. You did not know that it was registered in the Cayman Islands? 9 A. 10 91 Q. 11 A. 12 92 Q. 13 A. 14 I didn't know at that time, no. When did you find that out? Some time later. How long later? I don't know, Judge. I mean it could have been weeks. 15 93 Q. 16 A. 17 94 Q. It could have been weeks? Yes, or months, yes. Within a matter of weeks then you had learned, first 18 of all, that it was a nominee company called 19 Coral Reef Securities Limited that were holding the 20 shares ? 21 A. 22 95 Q. 23 Did you ascertain were they registered as the owners of the shares? 24 A. 25 96 Q. 26 No, I didn't, no. No. Did you make any enquiries as to who was registered as the owners of the shares? 27 A. 28 97 Q. 29 Yes. No, I didn't. How much money did you borrow, Mr. Ferguson? 1 98 Q 2 A 3 99 Q 4 A 5 100 Q 6 Something around 325 I think. At £1.20 per share? At £1.20, yes. That's right. There is no doubt, Mr. Ferguson, that you were the beneficial owner of these shares? 7 A 8 101 Q 9 A 10 102 Q I had no doubts, no. You had no doubts? No. You had absolutely no legal document to support your 11 claim that you were the legal owner of the shares, 12 is that correct? 13 A 14 As far as I know I haven't been able to find one Judge. 15 103 Q 16 A 17 104 Q 18 A 19 105 Q 20 A 21 106 Q 22 A 23 107 Q 24 A 25 108 Q 26 I mean ...(INTERJECTION). You signed nothing? Pardon? You signed nothing? I certainly signed a personal guarantee. Did you sign a personal guarantee? Yes, I did, yes. Yes? Yes . You got some documents then? Yes . You got some documents relating to this transaction. You got a personal guarantee to sign? 27 A 28 109 Q 29 A I did, yes. Who gave you that? 1 110 Q. 2 A. 3 111 Q. 4 A. 5 112 Q. 6 A. Who in Guinness & Mahon? Well, I presume it came from Mr. Traynor. Did you meet Mr. Traynor? Not personally at that stage, no. Somebody handed you this document to sign? That's right, yes. It may have come in the post. 7 can't remember. 8 I remember seeing it afterwards. 9 113 Q. 10 I do remember signing it and Where there any other documents that you were given at this time? 11 A. 12 114 Q. 13 14 I Not that I can recollect, Judge. When you say, "not that you can recollect," did you look to see? A. 15 I didn't specifically look. I mean I was dealing with a reputable merchant bank. 16 115 Q. 17 A. 18 116 Q. 19 A. 20 117 Q. 21 No? Sorry to go back. What I mean, Mr. Ferguson, is now? Sorry, yes. Have you looked to see since what records you have about this transaction? 22 A. 23 118 Q. 24 A. 25 119 Q. 26 A. 27 120 Q. 28 A. 29 121 Q. Yes, I have looked to see whatever records I had. Did you see any records? No, I didn't. You found no records? Well, I found some correspondence. What correspondence? Well, it is in the document that I submitted. No, that is not it. There is no correspondence 1 about Coral Reef Securities in 1984. 2 any correspondence about it? 3 No, I haven't been able to find any, Judge. 4 122 Q 5 A Yes ? I may have had. I mean to my mind the loan had been 6 made. 7 dealing with a bank. 8 123 Q 9 Did you have I knew I was liable for it. I knew I was Did you know what interest you had to pay on the loan? 10 A 11 124 Q 12 A 13 125 Q 14 A 15 126 Q 16 A Well, it was a variable rate of interest. How do you know that it was variable? Well, it seemed to change from time to time. However, was it agreed that it was to be variable? I assume it was. How do you know that it changed from time to time? Well, I seem to recollect being told that interests 17 rates was varying according to the 18 ...(INTERJECTION). 19 127 Q 20 A Who told you? I presume Mr. Traynor told me. I mean I don't 21 honestly know. 22 loan as being at a variable rate of interest. 23 128 Q I mean I would regard a normal bank I am just wondering what your recollection is, 24 Mr. Ferguson. 25 that the rates had been changed? 26 A 27 129 Q 28 A 29 Do you recall Mr. Traynor telling you I don't recall specifically, no. You do not? I don't. I mean I had several other bank loans with other banks and they were always subject to a 1 2 130 Q Did you know how this Coral Reef Securities -- what 3 its arrangement was? 4 told us, is that right? 5 A 6 131 Q 7 8 It was a nominee company you I thought it was a nominee. What do you mean by that? What did you understand by that? A 9 I thought that the shares were held on my behalf by this company. 10 132 Q 11 A 12 133 Q 13 A 14 134 Q 15 A 16 135 Q 17 A 18 136 Q 19 A By it? Yes . Yes. However, to whom did you owe the money? To Guinness & Mahon. You owed the money to Guinness & Mahon? Yes . When did you stop paying interest? When did I start or stop? Paying interest, yes? I presume it started pretty well straightaway, you 20 know. 21 interest had to be paid. 22 details. 23 137 Q 24 A 25 138 Q 26 A 27 139 Q 28 A 29 140 Q I don't know whether it was quarterely the I can't remember the exact Do you remember how much? But interest was accruing, Yes. I know, from the start. Do you remember how much you were paying? I think it was a reasonably high rate. No. Do you remember how much it was? Not specifically, no. 1 A. 2 I would say probably 10/12 percent. percent. 3 141 Q. 4 A. 5 142 Q. 6 How much did that come to? Pardon? How much did that come to? A. 8 143 Q. 9 A. A quarter. 10 144 Q. A quarter? 11 A. 12 145 Q. 13 A. 14 146 Q. 16 A. 17 147 Q. 18 £10,000? Yes. Who did you pay this to? Well, I recollect paying it to Guinness & Mahon in What do you mean by that? Well, I was repaying Guinness & Mahon the interest. No, what do you recollect about the repayments of the loan, Mr. Ferguson? A. I recollect paying various sums of money to the bank. 20 21 148 Q. 22 A. 23 149 Q. 24 A. 25 150 Q. 26 A. 27 29 It could be £10,000. the earlier stages. 15 28 What did you have to pay by way of a cheque? 7 19 Probably 12 To who? To Guinness & Mahon. To the bank? To the bank, yes. How were they paid? Were they paid to Mr. Traynor? I can't remember offhand when he took over. Whether they were being paid by post or ...(INTERJECTION). 151 Q. You cannot remember? 1 152 Q 2 A 3 153 Q 4 A 5 154 Q 6 A 7 155 Q 8 A 9 156 Q 10 A 11 157 Q 12 A 13 At some stage he certainly took over, yes. Did you then pay him personally? I paid him personally, yes. Used you go to his office? Yes, yes. You went into his office? I went into his office. And paid him a cheque? That's right. Who was the cheque made payable to? I would say to Guinness & Mahon in the earlier stages. 14 158 Q 15 A And the later stages? The later stages it could have been, and certainly 16 in the final stages it was Ansbacher because they 17 had taken over the business. 18 159 Q I want you to try and remember back when you think 19 you made the cheques payable firstly to 20 Guinness & Mahon and then who took over? 21 A 22 That is all I remember. I mean ...(INTERJECTION). 23 160 Q 24 A 25 161 Q 26 You do not remember in between? I don't remember in between or when that changed. No. However, you do not remember any other person to whom the cheques were made payable? 27 A 28 162 Q 29 And to Ansbacher. No, I don't. Your recollection is that you made the cheques payable to Guinness & Mahon? 1 2 163 Q. 3 A. 4 164 Q. 5 A. 6 165 Q. And then to Ansbacher? 7 A. And then to Ansbacher. 8 166 Q. 9 A. 10 167 Q. 11 A. 12 168 Q. That is Guinness & Mahon Ireland Limited? Yes. The Irish company? Right, yes. Yes? Now, I did pass over various cheques. That is what I am coming to? Sure. Okay. Apart from writing cheques did you pass over cheques to him? 13 14 A. 15 169 Q. 16 A. 17 I did, certainly. What were these? These were cheques that I would have received myself. 18 Q. Yes ? 19 A. Either as salary cheques. 20 Q. Yes? 21 A. Or cheques for sale of assets, which I had to do in 22 the later stages, you know. 23 Q. Yes ? 24 A. It became difficult for us after a while. 25 Q. I know that, yes? 26 A. To . . . (INTERJECTION). 27 Q. I will come to that, Mr. Ferguson? 28 A. Right. 29 Q. In addition to paying cheques you paid over cheques Okay. 1 2 Right. 3 176 Q 4 A 5 177 Q These would have been paid in his office? Yes, yes. I want to come back, Mr. Ferguson, to the 6 circumstances in which you and your fellow Directors 7 became entitled to take up shares in 8 Atlantic Resources. 9 happened? 10 A Well, there were various rights issues from time to 11 time. 12 Atlantic Resources. 13 178 Q 14 Again, I am giving the general history of No, you need not, just come to the time when you purchased shares? 15 A 16 179 Q 17 A 18 180 Q 19 20 Can you explain to me how that Well, ...(INTERJECTION). When you took up these ...(INTERJECTION)? Yes . When you made this borrowing of £375,000 to purchase shares ? A 21 Yes, my recollection is that there had been a rights issue or a placement some time previously. 22 181 Q 23 A Yes? At that stage we were not able to take up our 24 entitlements or to support the share issue through 25 lack of funds, through lack of available funds. 26 182 Q 27 A Yes? It was a very speculative company at all stages. 28 always required you to raise fairly considerable 29 sums of money to stay in business. These issue It 1 share issues would have been underwritten by 2 stockbrokers and various investment houses. 3 not regarded by them as favourable if Directors were 4 not seen to be taking up their shares. 5 black mark against the company if the Directors were 6 not seen to support it. 7 we could but at that final stage there in 1984 we 8 couldn't, in fact, it was the end of 1983 and we 9 couldn't support it. 10 183 Q 11 A It was It was a We did support it as best We didn't have the funds. Yes ? My recollection is that a lot of shares were left 12 with the underwriters and were hanging over the 13 market and this is when we decided we should buy 14 some of these shares. 15 184 Q That is it. However, it was completely hidden from the public 16 and from everybody that the Directors were buying 17 these shares? 18 A 19 185 Q That particular lot, yes, that is true. However, then there was no reason why you should buy 20 the shares in order to give confidence to the 21 public. 22 A It did not apply in this case? Well, it meant that these shares were available to 23 us that otherwise might be sold on the market and 24 over a long period of time. 25 186 Q 26 A 27 Yes ? They were available to us and we felt that we should support the issue. 28 187 Q 29 A I am only just ...(INTERJECTION)? 1 188 Q 2 3 I am only just asking you about the reason that you gave. A 4 It is not valid in the sense of the public awareness. 5 189 Q 6 A 7 Yes, very well? But it was valid in the sense that the underwriters were aware that the shares had been taken up. 8 190 Q 9 A 10 191 Q Yes ? 11 A Yes . 12 192 Q 13 Yes? On the market. Can you be more specific about the date on which this occurred? 14 A 15 193 Q 16 A 17 194 Q 18 I think it was early March/April 1984. March or April of 1984, you think? I think so, yes. I just take it that you have made enquires about this or you have checked it out, have you? 19 A 20 195 Q 21 22 It is invalid in this instance? Pardon? You have checked it out, have you? Is that pretty definite, March or April 1984? A I haven't been able, it has been difficult to get 23 information because I haven't been able to get any 24 information from them. 25 196 Q April of 1984? 26 27 A 28 29 However, your recollection is that it was March or My understanding is, after talking with my colleagues. 197 Q Yes? 1 2 198 Q. Would there be any records of this in the company of 3 these shares been purchased by the three of you? 4 Would there be a record in the company? 5 A. 6 There should be a record in Atlantic Resources of various share transactions. 7 199 Q. 8 A. 9 Yes? My understanding is that it has not been possible to identify these particular purchases that we made. 10 200 Q. 11 A. 12 201 Q. 13 A. 14 202 Q. 15 A. 16 203 Q. 17 Why is that? I don't know. I think you do know, Mr. Ferguson? Pardon? I think you do know? I don't honestly know. I mean ...(INTERJECTION). Because the shares were not taken in the name of Coral Reef Securities, were they? 18 A. 19 204 Q. 20 A. 21 No, apparently not. Is that not the reason? That is the reason -- no, you could still try and identify the numbers of shares. 22 205 Q. 23 A. 24 206 Q. No, but for some reason ...(INTERJECTION)? Or the quantity of shares. I take it that you do not know why 25 Coral Reef Securities did not take up the shares. 26 They were the nominee company? 27 A. 28 29 Yes. No, I only became aware of that quite recently. 207 Q. Yes, and that is the reason why you are not able to 1 identify who took up the shares. 2 the name of the company, is that it? 3 I don't know the name of the company that actually 4 took up the shares. 5 was Coral Reef. You do not know I assumed that it 6 208 Q 7 A 8 209 Q 9 A 10 210 Q 11 A 12 211 Q 13 A The register was searched. 14 212 Q Yes, on your instructions? 15 A 16 213 Q 17 A Yes? But that hasn't appeared in the register. Yes? Also ...(INTERJECTION). Did you look in the register? Yes . Did you check the register? On my behalf, yes. What came up? Well, they couldn't identify any particular numbers 18 of shares that equated, the sums, the amounts of 19 share that we had purchased. 20 214 Q 21 A 22 215 Q 23 A 24 The register. Who did this on your behalf? I can't honestly say. I think the solicitors did it. 25 216 Q 26 A 27 217 Q 28 29 Who could not? The solicitors did it? Yes . I see. You had advisors, Mr. Corcoran, is that right? A Mr. Corcoran, yes. 26 He was certainly 1 2 218 Q 3 A 4 219 Q 5 A I think he did. Yes ? I think he did. I was told that it couldn't be 6 identified, those particular shares that we had 7 purchased. 8 220 Q 9 A 10 11 Yes? Whether they were amalgamated with other purchases at the same time or...(INTERJECTION). 221 Q What I want to know is: How is it that it came 12 about that you purchased the shares at £1.20 in 13 March or April of 1984? 14 A 15 16 My understanding was that was the market price at the time. 222 Q 17 You were not buying shares in the market, is that right? 18 A 19 223 Q 20 21 I can't remember. How was that price fixed? Pardon? You were not buying shares in the market? You were taking up shares out of an issue, is that not right? A No, not specifically because the shares had not been 22 taken up in the placing. 23 through the underwriters. 24 224 Q 25 A They were still available You were taking them from underwriters? I assumed so. Now, to me that is through the market in my understanding. 26 27 225 Q 28 A 29 226 Q Very well? Yes . Yes. The underwriters had shares? 1 2 227 Q If Coral Reef Securities got these shares they got 3 them from the underwriters, is that your 4 understanding? 5 A 6 228 Q That is my understanding, yes. Would the underwriters have sold the shares to 7 Coral Reef at the market price, at the then market 8 price? 9 A 10 11 Well, the market price may have been the placing price. 229 Q I am not quite sure of that. You see I understood, Mr. Ferguson, and correct me 12 if I am wrong, but this was a placement of shares 13 which had been issued but had not yet been taken up. 14 They were then issued to you by the company, is that 15 wrong? 16 A I don't honestly know, I can't answer that question. 17 I don't honestly know. 18 the shares had failed to be placed by the 19 underwriters and were still with the underwriters. 20 230 Q 21 A 22 231 Q My own assumption was that But were they placed ...(INTERJECTION)? But my ...(INTERJECTION). Were they placed then to you and your fellow 23 Directors at the price in which they were originally 24 offered, at £1.20? 25 at £1.20? 26 A 27 232 Q 28 A 29 Were they originally offered I think that is the figure, yes. Was that the price they were originally offered? Yes, they were originally offered at £6 a share but there had been a share split by five. 1 233 Q 2 A 3 234 Q 4 A 5 235 Q 6 Which would be equivalent to £1.20. They were £1.20? Yes . You then and your fellow Directors were able to buy the shares, obtain the shares, at £1.20? 7 A 8 236 Q 9 A 10 237 Q 11 A Yes . 12 238 Q Yes ? 13 A 14 239 Q Yes . That was from the underwriters? Well, through the market. Through the market? From the underwriters, yes. Why I ask you these questions, Mr. Ferguson, is that 15 from information that we have got it would appear 16 that the price, the market price, of the shares was 17 a great deal more than that at that time. 18 know that? 19 A 20 240 Q 21 A 22 Do you I don't, no. You do not? No, I don't. I assumed the price had gone down to be honest with you. 23 241 Q 24 A Yes ? Because certainly they were -- we were under water 25 with our borrowings very shortly after the 26 borrowings were taken out. 27 242 Q 28 A 29 243 Q I just want to refer you to a document? Yes . I will explain to you in a moment what it is 29 1 2 Thank you. 3 244 Q 4 A 5 245 Q This is a ledger of Guinness & Mahon (Exhibit 1)? Yes . The account is in the name of "Guinness & Mahon 6 Cayman Trust College" and it is a call account. 7 is a sterling account? 8 A 9 246 Q 10 A 11 247 Q 12 Yes . You will see down there on the 20th February 1984? Yes . "5,750 Atlantic Resources shares were sold at £39,020"? 13 A 14 248 Q 15 Yes . Further down in March 1984 there were 4,000 Atlantic Resources were sold at £20,660.50? 16 A 17 249 Q 18 A 19 250 Q 20 A Yes . In rough figures about £5 a share. I can only assume that was after the split. I beg your pardon? I can only assume that that was after the 21 subdivision of the shares by five. 22 ...(INTERJECTION). 23 251 Q 24 25 I mean It would appear that you bought the shares around about the same time at £1.20 a share? A 26 27 It I don't know the exact date of the actual subdivision of the shares. 252 Q No, I am not talking about the price though. 28 talking about the price that you paid for the 29 shares ? I am 1 A. Well, there was no way that we bought shares at 2 £1.20 and they were being sold at the same time 3 at £6 a share. 4 253 Q. 5 A. 6 254 Q. I see. That could not be? That couldn't be, no. Very well. We can leave it then at that. Before I 7 go further in relation to these transactions 8 Mr. Ferguson I want to ask you about the documents 9 and the records that you have about them? 10 A. 11 255 Q. 12 A. 13 256 Q. Yes, Judge, yes. Your statement contained a number of documents? Yes. Which were, in fact, the same documents that your 14 colleague Mr. McCarthy gave us in his statement. 15 Were you aware of that? 16 A. 17 257 Q. 18 A. 19 Well, in fact, I got these copies from Mr. McCarthy. Yes? The ones I was able to discover in my own right were all dated from 1990 onwards. 20 258 Q. 21 A. 22 259 Q. 23 A. 24 260 Q. 25 A. 26 261 Q. 27 Yes. I think you have three or so copy letters? That's right. There are in relation to Coral? That's right. To Coral Reef Securities? Yes. However, all the others are from Mr. McCarthy's file? 28 A. 29 262 Q. Yes. I want you to tell me why that is so Mr. Ferguson? 1 2 Because I wasn't able to find any records. 3 keep the records. I mean I am not a great record 4 keeper, Judge, I have to say. 5 263 Q 6 A 7 264 Q 8 A 9 265 Q 10 A 11 I didn't Where did you keep the records of these? At home. In your home? In my home, yes. Not in your office? Not in my office, no, but I didn't have an office since 1989 really. 12 2 66 Q 13 A 14 267 Q 15 A 16 268 Q 17 Since 1989? Yes . Up to 1989 where was your office? I was in Fitzwilton in Hatch Street. Did you have records in relation to your investments in Hatch Street, in your Hatch Street offices? 18 A 19 269 Q 20 A 21 270 Q 22 Not really, no, no. Where were they then? At home in my house, wherever I was. All your own private records were at home, is that it? 23 A 24 271 Q Yes . Yes. Presumably you kept a record of the 25 substantial sum of money that you had borrowed. 26 you keep records in relation to it? 27 A 28 29 I didn't keep records, Judge. what my liability was. 272 Q Did I mean I knew exactly 1 2 273 Q 3 A 4 274 Q 5 A 6 275 Q Well, ...(INTERJECTION)? I mean I moved house several times. Just listen to the question, Mr. Ferguson? Sorry, Judge, sorry. I think you got correspondence from Mr. Traynor or 7 from Coral Reef Securities or from your colleagues 8 about this. 9 A 10 276 Q 11 A Did you keep the letters? No, no. You destroyed all the letters? Well, once I got the gist of what was being said -­ 12 I mean these were, if you like, transitory letters 13 dealing with the on-going situation. 14 277 Q 15 A 16 You destroyed all the letters? Well, I think that they would have been disposed of, or thrown out or whatever, you know. 17 278 Q 18 A 19 279 Q 20 A 21 280 Q 22 A 23 No, I do not know, Mr. Ferguson? Sorry, Judge. What did you do? Sorry. What did you do? I tend to clear out my correspondence quite regularly. 24 281 Q 25 A 26 27 What happened then? No, I am ...(INTERJECTION)? I do destroy a lot or dispose of a lot of what I regard as superfluous pieces of paper. 282 Q Would documents relating to this mounting debt, that 28 started off at £375,000, be superfluous in your 29 view? 1 2 3 283 Q. 4 and did you destroy them? 5 A. 6 284 Q. 7 A. 8 285 Q. 9 A. 10 286 Q. 11 12 Well, they confirmed what I felt. Were they superfluous and did you destroy them? Yes, they were superfluous and I did destroy them. When did you destroy them? Very shortly after I got them usually. I see. You have no records at all in relation to the original loan of £375,000? A. 13 Well, I did get a letter, which I requested, which is in the file here. 14 287 Q. 15 A. 16 288 Q. 17 No, no. Do not bother about the file? Yes. Because you have told me that you have just got those? 18 A. 19 289 Q. 20 A. 21 290 Q. 22 A. 23 291 Q. 24 A. 25 Yes. From Mr. McCarthy? No, it is not that one that I am talking about now. From Coral Reef. You asked for those, did you? I asked for this particular one. Which one did you ask for? It is dated 2nd March 1992. I asked for the details ...(INTERJECTION). 26 292 Q. 27 A. 28 293 Q. 29 However, what I what to know is was it superfluous Just one moment. Let me find it? Sorry. Just let me see it. 1 294 Q 2 A 3 295 Q 4 A 5 296 Q 6 Yes . This is "Ansbacher"? It is "Ansbacher". I asked Mr. Traynor to provide me with my overall position in regard to Coral Reef? 7 297 Q 8 A 9 Sorry, I am ...(INTERJECTION)? It is a memorandum, yes. It was a memorandum from Mr. Traynor to Mr. Furze (Exhibit 2). 10 298 Q 11 A 12 299 Q Yes. You asked Mr. Traynor for that? Yes . Presumably you asked him and he sent it to you from Mr. Furze then? 13 14 A 15 300 Q 16 A 17 301 Q Yes ? 18 A Yes . 19 302 Q Yes . When did you ask Mr. Traynor for that? Well, very shortly before I got it. You were in touch with Mr. Traynor asking for the 20 documents. 21 1992? 22 A 23 303 Q 24 What about the next one, 15th October That is addressed to Mr. Traynor? Yes . How have we got that now? How did it come about that you have been able to give us a copy of it? 25 A 26 304 Q Yes, in 1992? 27 A In 1992, yes. 28 305 Q 29 A Well, Mr. Traynor gave me a copy of it. And you kept it? I kept it. I mean very specifically if you look at 35 1 2 306 Q. 3 A. 4 307 Q. 5 A. 6 308 Q. 7 A. 8 309 Q. 9 A. 10 310 Q. 11 A. 12 311 Q. 13 A. 14 15 Where was it kept, Mr. Ferguson? It was kept at home. Was it kept in a file at home? Yes. What was the file marked? No, it wasn't marked. It was not marked? It wasn't marked, no. Are these the only letters in the file? These are the only letters that I kept, Judge. Were there other letters there? There would have been others letters from time to time . 312 Q. 16 No, I am just talking now between March 1992 and October 1992? 17 A. 18 313 Q. 19 A. 20 314 Q. 21 A. 22 I don't recollect. I don't think so. You do not think there were other letters? Well, can I say why I kept this particular letter. Yes? Because in the last paragraph he hints that; "action may be taken to recover the loans". 23 315 Q. 24 A. 25 316 Q. Yes. 26 A. Yes. 27 317 Q. 28 A. 29 318 Q. Yes? And that was an important factor in my mind. Do you see in May 1993? There is a letter written to you? Yes, that's right. You kept that? 1 2 319 Q 3 4 destroyed? A 5 320 Q 7 A 8 321 Q 9 A 10 Yes? Being ...(INTERJECTION). And did you keep any ...(INTERJECTION)? That was an important letter to me as well, Judge, I have to say. 322 Q 12 Did you keep any letters after? Did you receive any further letters after 1993? 13 A 14 323 Q 15 16 There may have been in relation to minor details about interest. 6 11 Was there letters in between that you may have I don't think so, no. You do not think that you received any further letters ? A 17 I don't think so, no. I mean if I can elaborate a little bit? 18 324 Q 19 A 20 325 Q 21 A 22 Yes ? I was in contact with Dr. O'Reilly at that stage. Yes? Because I had been under increasing pressure to repay the loans due. 23 326 Q 24 A Yes ? I had sold my house. I had sold various other 25 assets to meet these liabilities and other 26 liabilities. 27 terms that I had no other resources that I could 28 call on. 29 for the second loan, the Ascot loan. I was reaching the pin of my collar in He had provided a guarantee, as you know, I discussed 1 with him that I was under increasing pressure on the 2 Coral Reef loan, which he didn't guarantee. 3 hadn't guaranteed that. 4 into it on my behalf and obviously he took care of 5 it. 6 settlement which I heard later in regard to Coral 7 Reef. 8 327 Q. 9 A. 10 328 Q. 11 A. 12 329 Q. 13 A. 14 330 Q. 15 A. 16 331 Q. 17 A. 18 332 Q. 19 A. 20 333 Q. 21 A. 22 334 Q. 23 He said that he would look He made a settlement. I know that he made a Did he write and inform you of this? No. How did you hear it? I heard it through Mr. Corcoran. From Mr. Corcoran? Yes. Were you in touch with Mr. Corcoran? Pardon? Were you in touch with Mr. Corcoran about this? Only recently, yes. However, I mean about Mr. O'Reilly paying it? Yes. Mr. O'Reilly making the payment? Yes. I assumed he had made a settlement because he had told me not to worry about it? 24 335 Q. 25 A. 26 336 Q. 27 A. 28 337 Q. 29 He Yes. Did Mr. Corcoran tell you that? He told me that a settlement had been made. Yes? At a considerably smaller sum to my understanding. I see. I want you to give us evidence now about 1 2 338 Q 3 When was the loan, this further loan, made? In what year and about when? 4 A 5 339 Q 6 A 7 340 Q 8 A 9 I think 1986. 1986? 1986, yes. Tell us how it came about? Well, we were under increasing pressure in regard to the original loans. We were very much under water 10 in terms of the assets backing the loans. 11 discussing with Mr. Traynor -- and I am not saying 12 that he suggested that we borrow more money -- we 13 felt that he would be receptive to a further loan 14 which we would use to buy a more solid share, if you 15 like, being Fitzwilton primarily. 16 willing to structure that loan because it enabled 17 him to use some of the loan to repay some of the 18 other liabilities on Coral Reef and the other 19 companies. 20 341 Q 21 In He was quite Did you have discussions personally with Mr. Traynor about this? 22 A 23 342 Q 24 A 25 343 Q 26 We did. No, do not bother about "we" Mr. Ferguson? Sorry. I know witnesses say that and Judges get irascible when they do? 27 A 28 344 Q 29 A Sorry. I want you to tell me what happened? 1 345 Q 2 3 You saw Mr. Traynor. You talked to Mr. Traynor. Would you tell us what was agreed? A It was agreed that he would make another loan on 4 foot of Fitzwilton shares. 5 told us, told me, at the time that some of the 6 proceeds would be used to defray the original loans. 7 346 Q I don't know whether he How much was the loan that you were ...(INTERJECTION)? 8 9 A 10 347 Q 11 A 12 348 Q 13 A 14 349 Q 15 A 16 350 Q 17 A 18 351 Q £1 million. No, that was not the original loan? Pardon? In 1986. Was it £1 million? £1 million, yes. £1 million. I see? This is the Ascot loan. This is the Ascot one? Yes . Did Mr. Traynor tell you how the loan was going to 19 be structured, and how it was going to be brought 20 about, and what companies were going to be involved 21 in it? 22 A I can't remember whether he -- Ascot was the company 23 that was chosen. 24 whether it happened afterwards I don't know. 25 352 Q 26 A 27 353 Q 28 A 29 354 Q Whether he told us initially or Ascot holdings? Ascot Holdings, yes. Did you know where Ascot was registered? Well, I assumed it was in the Caymans. 1 2 355 Q. 3 A. 4 356 Q. 5 A. 6 357 Q. 7 What other companies? Well, Coral Reef. Was in the Caymans? Yes. Did you know that the loan to Ascot and Coral Reef was coming from the bank in the Caymans? 8 A. 9 358 Q. In 1986? 10 A. In 1986. 11 359 Q. 12 A. 13 360 Q. 14 A. 15 16 I knew the Ascot loan was coming from the Caymans. Yes? I knew the other loan had come from the Caymans. Yes? But that was after the event, after the initial event. 361 Q. 17 Yes. The million pounds loan to Ascot was for what purpose? 18 A. 19 362 Q. 20 A. 21 363 Q. 22 A. 23 364 Q. 24 A. 25 365 Q. 26 A. It was to buy shares in a more solid situation. Yes? Other than Atlantic. Yes. What were they? These were Fitzwilton? Fitzwilton, yes. Yes. Did that happen then? Did they buy shares? Yes. How many shares did they buy? I haven't been able to find out the exact number, 27 sir, but I have seen a figure of 475,000 shares. 28 don't remember the price at the time but they would 29 have been bought at market price in the market. I 1 3 66 Q This was an arrangement that was entered into 2 between the three of you, Mr. McCarthy, Mr. Collins 3 and yourself? 4 A 5 367 Q 6 A 7 368 Q 8 A 9 369 Q 10 A 11 370 Q That's right. And Mr. Traynor? Yes . Were you all then equally entitled to a third each? Yes . In the shares? That's right, yes. Did you regard yourself then from then on as a 12 beneficial owner of the shares that Ascot Holdings 13 held? 14 A 15 371 Q 16 A 17 372 Q Yes . To the extent of a third? To the extent of one third, yes. Yes. Did Mr. Traynor not give you an account from 18 time to time of the company or what shares it was 19 buying and what shares it was selling, and how it 20 was doing in relation to discharging the debt that 21 you owed, and each of your colleagues owed, did he? 22 A 23 373 Q 24 A 25 374 Q 26 A 27 He did. I am sure he did. What has come of those? Pardon? What has become of those records? I haven't got them, Judge. them again. 28 375 Q 29 A You destroyed them? I presume I destroyed 1 376 Q. 2 recollection of this at all? 3 A. 4 377 Q. 5 6 When you say, "you presume," do you have no Well, I haven't been able to find them. No, but have you no recollection of getting documents and destroying them? A. Not as such, no. Not of destroying them. As I said 7 I would have a pile of correspondence relating to 8 various issues that were ...(INTERJECTION). 9 378 Q. That is what I would have thought. I would have 10 thought there would have been a very considerable 11 amount of correspondence telling you how Ascot was 12 doing; what shares it had bought and what it had 13 sold; what money had been transferred to relieve 14 your debt? 15 A. No, when I mean by a considerable pile of 16 correspondence it would relate to all kinds of 17 different issues. 18 379 Q. 19 A. 20 380 Q. 21 A. 22 23 And involvements. I see? I mean there was never that many letters in regard to our dealings in Ascot. 381 Q. 24 I see. When you say "a pile of correspondence" it is nothing to do with what we are concerned with? 25 A. 26 382 Q. 27 A. 28 383 Q. 29 I see? No, no. I see? No, no. If there was not a pile of correspondence, if there 1 2 3 384 Q. They were two shares. They were Fitzwilton shares 4 and they were Atlantic Resources also, is that not 5 right? 6 A. 7 385 Q. 8 They bought Atlantic Resources and it sold Atlantic Resources ? 9 A. 10 386 Q. 11 Yes. It bought Fitzwilton and did it sell Fitzwilton from time to time? 12 A. 13 387 Q. 14 A. 15 Yes, apparently so. Yes? Again, I have to say, Judge, it is hard for me to explain but we really had lost control of those. 16 388 Q. 17 A. 18 389 Q. 19 A. 20 390 Q. 21 A. 22 Yes? Of those accounts. Yes? At that stage. Yes? We were very much at the discretion of what Guinness & Mahon decided to do. 23 391 Q. 24 A. 25 392 Q. 26 Yes? In regard to reducing our liabilities. Yes. Mr. Ferguson, I think we will break now. that is all right with you? 27 A. 28 393 Q. 29 That's right, yes. Yes. We will break for a cup of coffee for about ten If Certainly. Thank you Judge. SHORT ADJOURNMENT: 1 2 3 394 Q. MR. JUSTICE COSTELLO: 4 Mr. Ferguson, I want to return now briefly 5 to Ascot for a few moments? 6 A. 7 395 Q. Yes. The Ascot situation was from 1986 onwards. It was 8 buying and selling these Fitzwilton shares and 9 Atlantic Holdings, is that it? 10 A. 11 396 Q. 12 Yes. You were not registered as the owner of any interest in any of the shares? 13 A. 14 397 Q. 15 No, no. I think the shares in Ascot were in the name of "Overseas Nominees Limited"; is that right? 16 A. 17 398 Q. 18 A. 19 399 Q. 20 A. 21 400 Q. 22 A. 23 401 Q. 24 A. 25 4 02 Q. 26 A. 27 403 Q. 28 A. 29 404 Q. I don't know. It is in the correspondence? Sorry, yes. You referred to it? I am sure that you are right. Did you not check that out? Well, I did read the correspondence. Sorry? But I can't remember. You cannot remember? Yes. I think that it is in your statement too? Is it? Yes? 1 2 Would I be correct then in saying that you did not 3 enter in the share register of 4 Ascot Holdings Limited or of Fitzwilton any 5 interest, any equitable interest, in the shares? 6 A 7 406 Q 8 A 9 407 Q 10 Not in Fitzwilton, no. Or in Atlantic Resources? No, no. Did you have an accountant, a personal accountant, who was looking after your own income tax affairs? 11 A 12 408 Q 13 Yes, yes. Do you know did you inform him of your interest in these shares? 14 A 15 409 Q 16 A 17 410 Q 18 No. You did not? No, Judge, no. There would be no return made to The Revenue of anything to do with these shares? 19 A 20 411 Q No, no. Any interest that might have been earned on the 21 shares were not returned and any capital gains were 22 not returned? 23 A 24 I am not sure whether any capital gains ...(INTERJECTION). 25 412 Q 26 A 27 413 Q 28 A 29 No, Judge. Were made? Arose. Yes . But certainly there would have been ...(INTERJECTION). 1 414 Q 2 A 3 There would have been dividend income that is for sure . 4 415 Q 5 A 6 416 Q 7 A 8 417 Q 9 Dividend income? Yes . There would have been? Yes, yes. Do you know what happened to these shares? receive them ever? 10 Did you Did they come into your possession? 11 A 12 418 Q 13 A 14 419 Q Never, never. They were never registered in your name? No, Judge, no. When Mr. O'Reilly paid off the debt of 15 Coral Reef Securities, you do not know what happened 16 to the shares that it owned? 17 A 18 19 I don't. I assumed the guarantor got the benefit of them. 420 Q Yes. Similarly, in relation to the shares which Ascot had held, you never got any ...(INTERJECTION)? 20 21 A 22 421 Q I never got any. Yes. Very well. 23 Mr. Ferguson. 24 few questions? 25 A Mr. Thank you. Thank you Rowan would like to ask you a Thank you, Judge. 26 END OF EXAMINATION OF MR. FERGUSON BY MR. JUSTICE 27 COSTELLO. 28 29 1 2 3 422 Q 4 A 5 423 Q 6 MR. ROWAN: Good morning Mr. Ferguson. Good morning, Mr. Rowan. Mr. Ferguson, am I right in believing that at some stage you were a Director of The Central Bank? 7 A 8 424 Q 9 A Yes . When was that please? I can't give the exact dates Mr. Rowan but I think 10 from possibly the late 1970's up to the late 1980's. 11 I can find out for you but it was during the 1980's 12 mainly. 13 425 Q 14 A 15 426 Q 16 Yes . You indicated to us earlier that Fitzwilton made an investment in Atlantic Resources? 17 A 18 427 Q 19 A 20 Yes . Approximately when? I think 1981 or it could have been earlier. could have been 1980. 21 428 Q 22 A 23 429 Q 24 A 25 It It was, I think, 1981. Yes? Atlantic ...(INTERJECTION). I see, sorry? Atlantic Resources was formed. That was the date it was formed. 26 430 Q 27 A 28 29 Principally during the 1980's? Around 1981? Around 1981 to my recollection. It could have been 1980 but I think it was 1981. 431 Q Was the investment by Fitzwilton part of the 49 1 original capital which was introduced into Atlantic? 2 Yes, yes. 3 432 Q 4 5 What proportion of the shares did Fitzwilton hold at that stage? A I can't remember the exact number but ...(INTERJECTION). 6 7 433 Q 8 A 9 434 Q 10 A Roughly? I have a feeling it may have been around 20 percent. Who would have been the other major shareholders? The major shareholders would have been the 11 Directors, the original Directors, and individuals 12 who, if you like, started the company 13 Atlantic Resources, including Dr. O'Reilly, myself, 14 Mr. McCarthy, Mr. 15 I mean I can find that out for you in detail because 16 the original memorandum and articles of association 17 would show. 18 435 Q 19 A 20 436 Q 21 A 22 437 Q Collins and various other people. Was the company formed as a public company? Yes, yes. There would have been a public advertisement? Yes, that's right. Yes. That's right. If one took the Fitzwilton investment plus the 23 personal holdings of yourself and Mr. McCarthy and 24 Mr. O'Reilly and others who were close to you and 25 that group of individuals, what proportion of 26 Atlantic Resources shares might have been held at 27 the quotation date by those shareholders, plus 28 Fitzwilton? 29 1 438 Q 2 A 3 There was a public placing as far as I remember. was have been more than 50 percent originally. 4 439 Q 5 A Yes ? There were other Directors such 6 as Mr. James Stafford and Mr. Gerry McGuinness. 7 They weren't all Fitzwilton Directors. 8 other people as Directors also. 9 formed the company and placed a number of shares 10 with the general public but I can't remember the 11 proportion. 12 440 Q 13 A 14 441 Q 15 A 16 442 Q 17 A 18 443 Q 19 There were They originally I would say probably up to 50 percent. Would you please obtain this information for us? Certainly, yes. And let us have it? Yes, sure. In due course? Of course, Mr. Rowan, yes. Thank you. You became a Director of Atlantic Resources at that time? 20 A 21 444 Q 22 A 23 445 Q 24 At that time, yes. Around 1981? Around 1981, yes. Could I ask you please to turn to the documents that you sent us? 25 A 26 446 Q Yes . It was the memorandum, which we looked at earlier, 27 from Mr. Traynor to Mr. Furze regarding Coral Reef 28 Securities 29 It (Exhibit 2)? 1 447 Q This was the one, which I think you explained to the 2 Judge, that you had obtained from Mr. Traynor to 3 give you ...(INTERJECTION)? 4 A 5 448 Q 6 A 7 449 Q 8 I requested it from him, yes. Right? Yes . What we can see on that is that there was £374,000 advanced? 9 A 10 450 Q 11 A 12 451 Q 13 Yes . Which I take to be the original cost of the shares? Right. In your statement to us that acquired 344,333 shares ? 14 A 15 452 Q 16 Right. Then over the period you paid -- there was interest charged of £234,196? 17 A 18 453 Q Right. Therefore, at that point you had made an investment, 19 and when I say, "that point," I take this memorandum 20 to be written sometime around 1991, in the running 21 order of your papers? 22 A 23 Well, March 1992 is the date of it. It is underneath the signature. 24 454 Q 25 A 26 455 Q 27 Yes. That is quite right. March 1992? Yes . By March 1992 the original loan had incurred interest of £234,196? 28 A 29 456 Q Right. Which meant that at that stage you had a total 52 1 investment, if you like, in those 344,000 shares of 2 £609,000 approximately? 3 That's right Mr. Rowan, yes. 4 457 Q 5 A 6 458 Q 7 8 Yes. Well, yes, I did. How much might they have been worth, do you think, in March 1992 per share? A 9 I would say considerably less than the original cost, never mind the £600,000. 10 11 You still held the shares? I don't know. They could have been worth maybe £50,000/£100,000. 459 Q Yes. In some of the other papers we see shares 12 being sold, the Atlantic shares being sold at lOp 13 and lip? 14 A 15 460 Q 16 A 17 461 Q 18 Had they improved a bit by 1992? I don't think so. I don't think so. If we say sort of £30,000 to £50,000 they might have been worth, those 300,000 shares? 19 A 20 462 Q 21 Yes . Then you could, if you had sold the shares, have reduced your loss to about £550,000 or £560,000? 22 A 23 463 Q 24 A 25 464 Q 26 A 27 465 Q 28 A 29 Yes . Right. Would you agree with that? Yes, yes. I see. That is an incredible amount of money? Yes, unfortunately, yes. By 1992 you still held those shares? Yes . 1 Well, I never really had them physically myself 2 if you know what I mean. 3 by Guinness & Mahon. 4 467 Q 5 A 6 468 Q 7 A 8 4 69 Q 9 10 They were held Yes ? Now "Ansbacher". Yes. They were held in Coral Reef Securities? Yes . How long did Coral Reef Securities continue to hold the shares? A I don't know. I don't know. I never saw those 11 shares at any time because of the fact that this 12 loan was taken out for me. 13 470 Q However, in one of the other documents, which we 14 looked at earlier, the letter to you of the 15 27th May 1993, 16 A 17 471 Q 18 (Exhibit 4)? Right, yes. Which is from Mr. Traynor to yourself regarding Coral Reef? 19 A 20 472 Q 21 Right. In the third paragraph he says: "I wish to confirm however indicating to you that in the event that interest is not paid up to date in connection with Ascot, it is very likely and logical that Cayman would then feel that there is no point in waiting until the 30th September before taking action under foot of Coral Reef." 22 23 24 25 26 A 27 473 Q That sounds pretty threatening to me? 28 A Absolutely, and it did to me as well. 29 474 Q Yes . Yes? 1 2 475 Q 3 A Well, I discussed the situation with Dr. O'Reilly 4 and his representatives. 5 of the Ascot loan. 6 pressure on this original Coral Reef loan." So, he 7 said, "Look, I will do what I can for you." I heard 8 much later that a settlement had been reached in 9 regard to my liability to Coral Reef and I assumed 10 11 I said; "I am under severe that he took possession of the shares. 476 Q 12 13 He was already guarantor However, you never actually personally followed this up? A I was aware that I stopped getting pressure, if you 14 like. 15 negotiations or was certainly acting on my behalf in 16 regard to this loan. 17 477 Q 18 So, I assumed that he was either in We knew that in due course the O'Reilly family made a gift which sorted out all of this? 19 A 20 478 Q 21 A 22 No, no, I don't think so. Not in my case. I see? Yes, I think that was probably in Mr. McCarthy's case. 23 479 Q 24 A 25 480 Q 26 A 27 481 Q I see? Yes . Forgive me. Yes . However, if you asked Dr. O'Reilly to do something 28 to help you about this -- I mean, give us some more 29 information about that conversation and what he 1 2 3 482 Q. 4 A. 5 483 Q. 6 A. I mean in particular what he said about the shares? Well, I made him aware of the problem. Yes? He said, "I will look into it for you. See what can 7 be done." 8 taking me out of the problem he was obviously 9 entitled to take the shares as well, at the very As far as I was concerned if he was 10 small value they were at that stage. 11 kind of man that you question him often, 12 things going on this front?" 13 busy man. 14 it because I stopped getting these letters 15 threatening action? 16 MR. JUSTICE COSTELLO: 17 A. 18 19 "How are I mean he is a very All I knew was that he was taking care of Yes. Is it appropriate for me to say something about my relationship with Dr. O'Reilly? 484 Q. MR. JUSTICE COSTELLO: 20 You were a friend of Dr. O'Reilly. 21 You were close friends, is that right? 22 A. 23 485 Q. That's right. MR. JUSTICE COSTELLO: 24 This was a friend who was ...(INTERJECTION)? 25 A. 26 486 Q. 27 A. Well, I was also a very special business confidant. MR. JUSTICE COSTELLO: Yes? In the sense that I introduced him to the Heinz Company. 28 29 He is not the 487 Q. MR. JUSTICE COSTELLO: Yes? 1 2 3 MR. JUSTICE COSTELLO: A 4 Which enabled him to buy The Independent Newspaper group. 5 488 Q 6 A MR. JUSTICE COSTELLO: successful career. 8 MR. JUSTICE COSTELLO: A clear. 11 MR. JUSTICE COSTELLO: A 13 Of his career? So, you know, I just wanted to make that point 10 12 Yes? He regarded me as one of the cornerstones of his 7 9 I see. Yes. That he feels that he owes me a lot. MR. JUSTICE COSTELLO: 14 Yes. Very well. We understand. 15 A 16 489 Q Yes. Thank you. MR. ROWAN: What you know is that he 17 sorted -- he did something 18 because you no longer were under pressure in respect 19 of the indebtedness? 20 A 21 490 Q 22 A Yes, that's right. Of Coral Reef? Yes, and one of the reasons that I got that previous 23 letter was to show him the efforts I had been making 24 to clear this debt. 25 491 Q 26 A 27 Yes ? Apart from getting the picture myself of how it stood. 28 492 Q 29 A Yes? I also wanted him to know that I had made very 57 1 serious efforts to -- I had sold my house for 2 example. 3 493 Q 4 A 5 494 Q 6 A Yes ? In 1987. Yes ? I had sold a lot of my art through auctions. So, I 7 had made strenuous efforts and I wanted to show him 8 that I had made strenuous efforts to reduce the 9 liability. 10 495 Q You supposed that as a result of your conversation 11 with Dr. O'Reilly saying, "Look, please can you do 12 something to help here?" He would have made contact 13 with Mr. Traynor? 14 A 15 4 96 Q Absolutely, yes. Between the two of them there would have been 16 negotiations and it would have somehow been sorted 17 out? 18 A Yes. I mean that is my understanding. I think that 19 is the fact of the matter. 20 think he would have done it himself but I think he 21 would have got his representatives to do it for him. 22 497 Q 23 Yes. Now, obviously I don't I think you said also, at some stage, that Atlantic Resources eventually turned into Arcon? 24 A 25 498 Q 26 A That's right. Can you tell us a little about that please? The O'Reilly family had taken an interest in Conroy, 27 I think that was the name of the company at the 28 time, which had made a zinc discovery in Tipperary. 29 They eventually acquired control of that company, 1 Arcon. 2 acquired the shares in Atlantic Resources. 3 Atlantic Resources still do have discovery, you 4 know. 5 various oil interests and they do have an oil 6 discovery off the south coast of Ireland. 7 499 Q 8 A 9 It has not come to shore yet but they do have Yes? So Arcon, which is the family company that Mr. O'Reilly changed from Conroy, it is a public 10 company, acquired Atlantic Resources. 11 500 Q 12 A 13 501 Q 14 A 15 502 Q 16 17 They changed the name to Arcon and they It acquired Atlantic Resources? It acquired it, yes. It acquired 100 percent of the shares? 100 percent of the shares, yes. Right. So, that on that supposition the Coral shares were acquired as part of that exercise? A I assume so, yes. I assume so because I never saw 18 them; because as far as I was concerned they weren't 19 mine. 20 diminished very much. 21 503 Q 22 A 23 504 Q 24 A 25 I see? If the debt was taken care of ...(INTERJECTION). I see? Well, whoever took care of the debt was entitled to the shares. 26 505 Q 27 A 28 506 Q 29 They were security against the debt which had Okay. It was a very limited value. Could I ask you please turning to Ascot Holdings, could I ask you to turn to the letter of the 31st 1 2 3 Yes, I have got that here. 507 Q You will see that on the first page of that letter, 4 there are some transactions detailed where there 5 were some Atlantic shares purchased and some 6 Fitzwilton shares sold? 7 A 8 508 Q 9 Yes . Then over the page, on page two, we see that -- and it is a bit hard to read the top paragraph but it 10 says : 11 "We presently hold 760,000 shares in Fitzwilton?" 12 Further along that paragraph: 13 14 "375,000 shares in Atlantic Resources?" 15 16 A 17 509 Q Right, yes. At that date, therefore, Ascot had that number of 18 shares, 375,000 Atlantic shares and 760,000 19 Fitzwilton shares? 20 A 21 510 Q 22 A 23 511 Q 24 Yes . It had a balance of a loan of £542,910.77? Right. After the transactions that happened on previous days ? 25 A 26 512 Q 27 Yes . Could I ask you please to turn now to the page which is the 13th February 1990, that letter 28 A 29 513 Q (Exhibit 6)? Yes . At the bottom of the first page of that letter, it 60 1 2 "The quoted investments referred to in (9) (which is the security heading) consist of 535,000 Atlantic shares and 475,000 Fitzwilton shares?" 3 4 5 6 Yes . 514 Q 7 Therefore, we see that between 1986 and 1990, the Atlantic shares have grown from 375,000 to 535,000? 8 A 9 515 Q 10 Right. So that yourself and Mr. McCarthy and Mr. Collins, continued to buy through Ascot, Atlantic shares? 11 A 12 516 Q 13 A Yes, yes. Why was that? I do not honestly know, Mr. Rowan, but my feeling is 14 that we did not really have full control over the 15 proceedings of Ascot at that stage, that Mr. Traynor 16 was dictating things that should be done. 17 honestly recollect why we bought Atlantic shares at 18 that stage. 19 sanitary before that, but I do not honestly know 20 that. 21 517 Q 22 I cannot I thought from experience that was very Also, during the period you started off in 1986 with 760,000 Fitzwilton shares? 23 A 24 518 Q 25 A 26 519 Q 27 A 28 520 Q 29 A Yes . Those had reduced to 475,000 Fitzwilton shares? Yes . By the time you got to 1990? Yes . Some shares in Fitzwilton had been sold? 1 521 Q 2 A I assume that Mr. Traynor was trying to reduce the 3 borrowings and again, we were not in control at that 4 stage. 5 522 Q selling shares? 6 7 In effect, Ascot Holdings, in fact, was buying and A I think there were a number of transactions. I do 8 not think there were very many. 9 there are some of them here but I cannot be certain 10 11 I think probably of that. 523 Q You observe also, of course, that this facilities 12 letter of February 1990 agreed an advance of 13 sterling one million pounds? 14 A 15 524 Q 16 A 17 525 Q 18 19 Right, yes. The loan was a million pounds (Exhibit 6)? Yes . That had grown from the 1986 letter, it had grown from £542,910 to a million? A My understanding, as I said earlier, was that we had 20 borrowed a million in the first instance. 21 whether it was all drawn down at the same time, I do 22 not know but the figure in my mind was always that 23 we had borrowed a million in Ascot. 24 526 Q 25 26 29 But the loan had increased, had it not, over the four years? A 27 28 Now, It had increased because of interest accruing, it had not been paid off fully. 527 Q Yes. Could I then ask you to go back in your papers, in your book of papers to the letter of the 1 2 Yes . 3 528 Q 4 A 5 529 Q This is a letter from Mr. Traynor to yourself? Right, yes. "Dear Vincent, 6 this is to advise that the special advance to Ascot amounted to sterling £149,408.92 which it in turn on-passed to enable the various entities to meet their commitments." 7 8 9 10 11 What does that mean exactly? A What I assume it means and again, and excuse me if I 12 am not certain on it, but, I think, what he was 13 doing was using money from Ascot to repay certain 14 arrears on the other loans, the original loans, 15 Coral Reef and the other two loans to Mr. Collins 16 and Mr. McCarthy. 17 530 Q Then the second paragraph says: 18 "As a result of this advance, the balance outstanding to Guinness Mahon Cayman Trust, inclusive of interest at the 31/3/1987 was sterling £675,191.?" 19 20 21 A 22 531 Q 23 A Yes, and the transfer. 24 532 Q The transfer of money? 25 A 26 533 Q 27 A 28 534 Q 29 A Yes . The balance had grown then because of that? Yes . Out of Ascot to these other borrowings? Yes . To reduce them? 1 Then the following page in your documentation, a 2 letter of the 4th September 1987 to Mr. McCarthy 3 from Mr. Traynor (Exhibit 8): 4 "You will receive word from Vincent that as of the 25th September you will effectively have received by way of loan from Ascot the sum of sterling £115,947.82." 5 6 7 8 A 9 536 Q 10 A 11 537 Q 12 A 13 538 Q 14 A 15 539 Q 16 Yes . This was a further transfer from Ascot? Yes . To the other companies? Yes . To produce their indebtedness? That is right, yes. I believe, if you turn to the letter of the 28th May 1990 17 A 18 540 Q 19 (Exhibit 9)? Yes . This is a letter from Mr. Traynor to Mr. McCarthy where he says: 20 "I am sure the three of you have clear figures in your records but just in case! ..." 21 22 23 A 24 541 Q Yes . Then the next paragraph says: 25 26 27 28 29 "... March 1987, September 1987 and March 1988 had advanced made ex Ascot to look after other items for the three of you as follows." 1 2 542 Q 3 If you deduct from the £475,000, the two amounts I mentioned earlier, the £149,000 and the £115,000? 4 A 5 543 Q Yes . If you take those away, I get left with an amount of £210,264? 6 7 A 8 544 Q 9 Yes . That was a third payment which appeared to have been made in March 1988. 10 A third payment out of Ascot to the other companies? 11 A 12 545 Q Yes, yes. Those three payments totaling £475,000 13 approximately, one of the reasons it seems why the 14 Ascot loan grew from £542,000 in 1986 to a million 15 pounds or thereabouts in 1990? 16 A 17 546 Q 18 A Yes, yes. Is that your understanding? My understanding is that he provided a million 19 pounds loan but used part of that million pound loan 20 to Ascot to reduce the other liabilities arising on 21 the other accounts over a period of time. 22 of the reasons why the purchase of Fitzwilton shares 23 is a lot less than a million pounds. 24 547 Q It is one The paperwork starts to get somewhat slim on the 25 subject of Ascot. 26 became of Ascot and the shares which it held? 27 A What eventually, Mr. Ferguson, I know Mr. McCarthy was different to my case and 28 Mr. Collins, in a sense that his share of Ascot was, 29 if you like, taken out of Ascot and amalgamated with 1 2 He had put a guarantee in place. 3 1990 by Dr. O'Reilly to cover Ascot up to the amount 4 of £750,000. 5 called in. 6 understanding is it is 1998 it was called in. 7 Personally, I had assumed that they had called it in 8 much earlier and had been repaid. 9 shares then went to the benefit of the guarantor, 10 11 That guarantee, It was in place in I understand was I do not know exactly when but my I assumed the the shares held by Ascot. 54 8 Q. You do not know exactly what happened? You cannot 12 give me chapter and verse, if you like, as to what 13 happened to Ascot Holdings? 14 A. No, no. All I know is that the loan was taken out, 15 the guarantee was called out, the money was paid 16 over and then the shares went to the guarantor, the 17 shares remaining in Ascot. 18 549 Q. 19 A. 20 550 Q. 21 A. 22 551 Q. 23 A. You held what proportion of the interest in Ascot? One-third. You held a one-third interest in Ascot? Right. You do not know exactly what happened to Ascot? I do not know what happened after the guarantee was 24 called in, if you follow. 25 was taken care of as far as I was concerned by the 26 guarantor. 27 552 Q. 28 A. 29 553 Q. How do you know that? I had been told. By whom? You know what I mean, it 1 2 554 Q 3 A 4 555 Q 5 6 By Noel Corcoran? Yes . Noel Corcoran has a good view of what happened to Ascot? A I imagine he has probably the best view of what 7 happened afterwards because he would have been, if 8 you like, taking care of the operations. 9 556 Q 10 11 Did you ask him in anticipation of this interview; did you ask him for any information on Ascot? A Not particularly. It was out of my hands, in the 12 sense, that I was not being pressurised for 13 repayment any more. 14 as I understand it, and the loan had been repaid. 15 557 Q The guarantee had been called, You have sort of left us hanging though because you 16 have provided us with some copy documentation and 17 then suddenly to...(INTERJECTION)? 18 A 19 20 afterwards. 558 Q 21 22 I have no documentation in regard to what happened Mr. Corcoran might have been able to provide you with some? A I did ask him what -- not for documentation as such, 23 but I did ask him when was the loan paid off 24 finally. 25 certainly no later than the mid 1990's. 26 understand it did not take place until 1998. 27 559 Q 28 A 29 560 Q I assumed the loan had been paid off I Did he tell you whether interest continued to run? No. On the loan? 1 2 No, he regarded it as not my responsibility anymore. 561 Q 3 third of the letters dated the 28th May, 1990? 4 A 5 562 Q 6 Yes . This is a letter from Mr. Traynor to Mr. McCarthy where he says: 7 "I wish to confirm that the balance representing the trading loss as at the 31st May 1990 is sterling pounds, £29,701.58. This was confirmed by me to Vincent on the 2nd May." 8 9 10 A 11 563 Q 12 13 Could I ask you to turn please, Mr. Ferguson, to the Yes . What exactly does that mean do you think, Mr. Ferguson? A Again, I do not honestly know. My understanding, my 14 own understanding, is that it represents a loss on 15 shares actually sold. 16 would be producing, if you like, security in terms 17 of the original security. 18 loss on the value of the shares. 19 564 Q 20 A 21 22 23 That this was a realised In which company? I presume Ascot, I do not honestly know, it must be Ascot. 565 Q In other words, that sum That is the joint company. Did Ascot maintain a trading profit and loss and balance sheet? 24 A 25 5 66 Q 26 A No, I have never seen one. The use o f ...(INTERJECTION)? Sorry, the record is an internal mechanism that the 27 bank were using. 28 had a loan outstanding and there was various 29 securities there, various securities were sold from As far as we were concerned, we 1 time to time. 2 on one of those, the sale of securities. 3 567 Q I would assume that this was a loss Could I just confirm with you if that Ascot Holdings 4 was a limited company? 5 company? 6 A 7 I do not honestly know. Was Ascot Holdings a limited I assume it must be a limited company. 8 568 Q 9 A You were a one-third shareholder? Again, I have never had shares. There is no 10 evidence to say I was a one-third shareholder in 11 Ascot. 12 out in on behalf of the bank. 13 5 69 Q 14 Ascot was the name that the loan was taken In your statement to us you say, it is on page 5 of your statement at the top, you say: 15 "I also borrowed money through Ascot Holdings Limited?" 16 17 A Yes, yes. I presume it is a limited company. 18 far as I was concerned, it is the bank's way 19 o f ...(INTERJECTION). 20 570 Q 21 A 22 571 Q 23 A That is what your statement says to us? Sure, yes. Where was this company registered? I do not know. I do not know to be honest with you. 24 I presume it was the Caymans but I cannot be 25 certain. 26 572 Q 27 As That Ascot Holdings was registered in the Cayman, you believe? 28 A 29 573 Q I believe, yes. Presumably there would be requirements in Cayman as 69 1 in Ireland for a limited company to file annual 2 accounts ? 3 I do not know what the requirements are in the 4 Cayman Islands. 5 574 Q 6 A 7 I do not know, honestly. It seems a likely proposition, does it not? I am sure. I mean it would confirm the general practice. 8 575 Q 9 A 10 576 Q 11 A 12 577 Q You never saw any accounts? No. For Ascot Holdings Limited? No. This was a company which you and your fellow 13 colleagues, Messrs. McCarthy & Collins became a 14 party to, allowed it to borrow money. 15 sort of beneficial interest in it and you never saw 16 accounts ? 17 A 18 578 Q 19 A 20 579 Q 21 A 23 580 Q 24 A 25 581 Q 26 A 27 28 29 No, no. You never played any part in setting all of this up? No, none whatever. All of those matters where undertaken on behalf of the three of you by Guinness & Mahon? 22 You had some Yes . And particularly Mr. Traynor? Yes, yes. Thank you very much. Thank you, Mr. Rowan. 1 2 3 MR. FERGUSON WAS EXAMINED, AS FOLLOWS BY MS. MACKEY 4 5 MS. MACKEY: Mr. Ferguson, just really 6 questions on one 7 particular area and that is the cheques which you 8 gave to Mr. 9 to repay, to make repayments on your loans? 10 A 11 583 Q Traynor or to Guinness & Mahon in order Yes, yes. I have two specific questions in relation to those 12 cheques. 13 made out to cash? 14 A 15 584 Q 16 A 17 585 Q 18 A 19 586 Q 20 A First of all, a number of the cheques were Right. Why was that? I presume Mr. Traynor asked me to. Do you remember that he did? Pardon? Do you remember that Mr. Traynor asked you? I do not remember it if he did but I would have done 21 whatever he asked me to do. 22 as much as I could off these loans. 23 587 Q 24 A I was trying to repay Yes ? Whatever cheques I could obtain from various 25 services, I would go along to Mr. Traynor and hand 26 them over to him and sometimes I would pay the 27 cheques to him. 28 You told the Judge earlier that initially you made 29 the cheques payable to Guinness & Mahon? 1 2 58 9 Q. 3 4 At what point did you change and make them payable to cash? A. I would think it is probably during the course of 5 the gathering trauma in regard to trying to meet the 6 sums due as best I could. 7 590 Q. 8 A. 9 Yes? That I would go along to Mr. Traynor with a cheque and if he told me to make it out to Uncle Tom 10 Casley, I would have done it. 11 belief in him. 12 591 Q. 13 A. 14 592 Q. I had faith and Yes? As a representative of Guinness & Mahon bank. You would go along to Mr. Traynor without having 15 already made out the cheque in advance? 16 not have made out a cheque to Guinness & Mahon? 17 A. 18 593 Q. 19 A. You would No. For the amount that you wanted to pay? No, because normally I would not be able to meet the 20 full liabilities that were outstanding. 21 along with whatever sums I could make available to 22 him. 23 594 Q. 24 A. 25 595 Q. 26 Yes? Yes. You do not recollect specifically that he told you to do this but you think it is likely? 27 A. 28 596 Q. 29 I would go I think it is very likely, yes. Do you know why he might have told you to do that? 1 597 Q. 2 A. Yes? He was handling the matters on behalf of 3 Guinness & Mahon to my mind. 4 handling those matters to suit his way of dealing 5 with it, I went along with it. 6 598 Q. 7 However, he was Did he give you any reason why he might have asked you to make them out to cash? 8 A. 9 599 Q. 10 No, no. Then at a later stage, you made a number of cheques payable to Ansbacher? 11 A. 12 600 Q. 13 A. 14 Yes. Why was that? Again, Mr. Traynor would have told me to make them payable to Ansbacher. 15 601 Q. 16 A. Can you remember when that change came about? I do not know when Ansbacher came into the 17 reckoning, in the situation. 18 before Ansbacher had been acquired or 19 Guinness & Mahon had been acquired by Ansbacher? 20 602 Q. 21 A. 22 603 Q. Was this after or Guinness & Mahon Cayman Trust I think? Yes. When Mr. Traynor asked you to make out the cheques 23 to Ansbacher, did he explain why he was asking you 24 to do this? 25 A. 26 604 Q. 27 28 29 No. Did you ask him why you suddenly were making out cheques to an entity called Ansbacher? A. No, as I said, did Ansbacher take over the Cayman account, the Guinness & Mahon Cayman. 1 605 Q 2 A 3 60 6 Q 4 A 5 607 Q I think I was aware. You were aware of it? I think it was public knowledge at the time. Very good. I have no further questions, thank you. 6 7 END OF EXAMINATION OF MR. FERGUSON BY MS. MACKEY 8 9 MR. JUSTICE COSTELLO: Thank you 10 Mr. Ferguson. 11 The transcript of your 12 evidence will be prepared and we would ask you to 13 come in to sign it? 14 Certainly. 15 mr . M cAl e e s e : I wonder Judge, sorry to 16 interrupt, before you 17 finish, could I consult w th my client just for a 18 moment before you finish. 19 MR. JUSTICE COSTELLO: 20 Would you like to go into 21 the consulting room? 22 mr . M cAl e e s e : I do not think it will be 23 necessary. 24 brief. 25 mr . M cAl e e s e : Thank you. 26 27 (SHORT ADJOURNMENT) 28 29 Yes, of course, yes. AFTER A SHORT ADJOURNMENT 74 I will be very 1 2 3 point in regard to Ascot 4 to Mr. Rowan, that I never had any beneficial 5 interest or ownership in Ascot. 6 nominee company used by Guinness & Mahon. 7 wanted to make it clear. 8 MR. JUSTICE COSTELLO: 9 10 Ascot, again was a I just I think that is clear, Mr. Ferguson. A. 11 Sorry, fair enough. MR. JUSTICE COSTELLO: 12 No, of course, no, it is just in the course of the 13 discussion, it may not have been made clear. 14 understand your evidence, you never had any 15 shareholding in Ascot. 16 any shares in Ascot? 17 A. 18 MR. JUSTICE COSTELLO: Ascot owned? A. 22 Exactly, Judge. MR. JUSTICE COSTELLO: 23 29 You were your view to the assets? A. Exactly, Judge. MR. McALEESE: 27 28 To a third. beneficially entitled in 24 26 But you were entitled to the underlying shares that 20 25 You were never entitled to Yes. 19 21 As we I just took that up as Mr. Rowan was finishing his questioning, I perhaps misinterpreted it. 1 think it is good to have 2 the matter clarified. 3 much. Very well. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW WAS THEN CONCLUDED Thank you very 0/0 6110/3 5,2499 (21.01.20 aim/27.5w n59} - ?l p.o; Box U7 Ctud Cayman, Cayman Iiiam)*, Britiih Wot Indlw ' .Tdaphem: (S09) 9494653 Take CP4303' FaeaiiaiU (109) 949*7946 (109) 949.326? 1) MEMORANDUM To: J. D . Traynor ‘From: • Join A. Font -r /I.S.. V.p. fStGtA**1* Ra: Coral Reef Securities Ltd. A brief analysis of die loan poddon ii u foUowa: ;r... . Funds Advanced Intefett charged 374,739,69 234.12642 608^986.1 Repayment! Loinbalance tI inoatm rAi.«ww>QCTjyco»gAjg»wta qifwoM « , n 2*, 72000 16:20 PAGE 08 EMSWORTH 353-1-8461905 609 949 7946 10 15X9a> • ANSBACBER •CAYMAN 1U21 •• '. ■ . 8^01 * •*■ » * t AnibtichetLimittd • • » P.O. Box IS?, GrandCayman, Ctyaua hltndt, BritfakWait lodkt . • T#Hpbon#; (10$) 9494*45 T«kxs CP 4305 . • Feeilm!!'(809) 949-7946 (»9)949-52<7 V J t F a c r im ile # 0 11-3 3 3 1-15 12 -0 3 3 15 October, 1992 JA F s ill • . J.D.ttynartBsq, • .CRH pie 42Htzwilliam Square Dublin 2 , IRELAND Dear Des, • ' • • ' . . • * • • . . . Ba; Coral Rttflf SflOUritica Ltd. • • ’ ' * T h e l o a n b c l a a c p o u t i f t a n d ln f M a t 3 0 t h S e p t e m b e r 1 9 9 2 ! » a a f o l l o w s : P e r f a c i l i t y l e t t e r 1 4 t h J i n a j n y J1 9 9 1 I n t e i ^ t o 3 0 t h S e p te m b e r 19 9 2 ' . • . x n jm .1 9 -, idsaiU —fifiLQft 1 jSA v fiw S S 292 JLQSUQ . L e u p a y m e n t o n account ** •Qg7.4M.23 iDteTettliTimniBg Bt the roe of £93,48 per day. . . . ’ •• * . D u . I v e r y n x a c h r e g r e t t o a d v i s e y o u t h a t o a l e u t h ia a m o u n t U d e e w d b y . N o v e m b e r 1 9 9 2 w o u w t b e e n in it n ie t e d to c a l l thA l o t a a n d p r o c e e d , a f t t a f t t b e . g u a r a n t o r . I f y o o f e e l th e r e i s n o p o in t In w a i t i n g u n d l 3 0 * N o v e m b e r , p l e i a e a d v i s e a n d , 1 w e w tilc o m m e n c e th e m o v e n o w . • Please let me hem*from you »tnd ht away. * . • Yoars sincerely, . •. ' : tMbWJKIH ": -i..r f s«’: : ,T»i: 870:5144/876 3066; ‘jf«:’86’1'203?-; • - *• / • *A, * • * ;•• • i STRICTLY- X.V.Tf*!*; .’f ' \ \ S C* ,4-V.V--r.-v : ;__Appendix xv; i; GUINNESS MAHON CAYMAN TRUST LIMITED kIm m gt tta OunMaa Malm Marefta* 9 a m * Qfoua » .0 .3 « a iT T O N M M NO MM«> IMK1U Sa a»oos m Cayman iW* 3 1*c m , 19 8 6 your raf ouriat IAF:«« J . D . T ra y n o r Esq. 3 T r ± n iC 7 S e ra tc D u b lin 2 ' IR E L A N D Daar D « ii ‘ > g » A ic o c B o l d l n t a L e d . Tha C o l l o w i n g t r a n s a c t io n s cook p la c a c h i* a o n c b t - PURCHASED 200,000 ‘ A x la n c le S a s o u r c a s A t l a n t i c R a s o i t r c a s C a l l O p t io n s 4 0 ,0 0 0 4 9 .8 16 .0 0 2 ,13 8 .0 0 3 1.9 3 4 .0 0 SOU 3 0 ,0 0 0 Anounc p a id F itz v ilc o n an l i t D a c t a b a r 19 8 6 3 8 ,0 9 3 .2 3 £ 13 ,8 6 0 .7 3 PURCHASED 17 3 ,0 0 0 Ac l a n t i c R a s o u x c a s £ 4 6 ,3 6 1.14 Ab>j>'« a n o u n c p a i d on 1 3 t h D a c t a b a r 19 8 6 ./e o n c 'd o /=> J . fi . T r a y r . — • ' ! • r D * v t n: ■J er. .'.036 J»> p r e s e n t l y ^ 7r shares in F i i E v i ! - - n O U . u O u acouI r*, - through i p v»n-n S ^ c c r i s 1 a\ j .OC0 throt.-jii Sraw . :.pan> and " *,yuO A t l a n t i c St ??■. r.‘*s “ 5 • :-.awir.i'‘ i l l y we ha,- similar type o f service which may have been offered by the Company/Guinness & Mahon (Ireland) Limited. I appreciate that what is being described here by you have become commonly known as “Ansbacher Accounts”. > * ] 7 . Nor did I have an account o f that nature (or indeed any other account) with Irish Intercontinental Bank, nor did I have any dealings with Amiens Securities Limited or Amiens Investments Limited. I never had dealings with Kentford Securities Limited o f *\ the nature referred to by the inspectors on pages 11 and 12 o f Appendix C to their letter, and in fact as far as I was aware I never had any dealings at all with any entity o f this ' name. I have, however, been advised by the Moriarty Tribunal that monies paid by me by way o f interest repayments to the Company were lodged to a bank account in the name j o f this company. Once again, further details o f this are provided below. (iv) 8. J Guinness & Mahon (Ireland) Limited loan/guarantee facilities secured by cash deposits with Ansbacher (Cayman) Limited I, at no time, had any such facilities extended to me by either Guinness & Mahon (Ireland) Limited or Irish Intercontinental Bank Limited, nor have I ever had dealings with either the latter or Kredietebank NV. Nor did I ever seek to obtain such a facility - 1 never had I any funds on deposit (either directly or indirectly) with die Company which would have enabled me to seek to enter into such an arrangement as described. (v) 9. Exchange Control Acts 1954-1992: In respect o f the transactions which I outline in some detail further on in this statement, I wish to advise that I personally never sought Exchange Control Act approval. I I assumed that exchange control approval would be organised by the bank which arranged - the loans - namely Guinness and Mahon Ireland. ! (vi) Channel Island Trusts and Companies o ’ ' h 10. j I never, at any stage, availed o f any o f the services described. Nor was I ever at any stage a beneficiary o f the trusts/companies mentioned in your letter. I have never had dealings with Guinness Mahon Jersey lim ited, Guinness Mahon Channel Islands Limited or College Trustees Limited or indeed any company called Sovereign Management Limited. (vii) 11. ^ Bodies corporate which had dealings with Ansbacher (Cayman) Limited I at no stage, had any direct or indirect interest in any body corporate which had dealings with the Company. Nor had I any dealings with subsidiaries o f or entities relating to such ^ bodies corporate. Nor had I any interest (direct or indirect) in any trust which had dealings with the Company. •j (viii) 12. Services operated by Ansbacher (Cayman) Limited o f which I availed - I say that I obtained circa 1984 loan finance from die company then known as Guinness Mahon Cayman Trust Limited (“GMCT”). I was at that time a director o f Atlantic Resources Limited (“Atlantic”) and a shareholder in that company when I sought finance to invest in that company’s shares. I obtained loan finance o f STG£375,000 to purchase the shares at a price o f £1.20 per share. The loan finance was arranged by Mr. Des Traynor o f Guinness and Mahon Bank Limited, but was advanced by GMCT to one o f ' ! its n o m in ee companies, Coral R eef Securities Limited (“Coral Reef*). That company purchased Atlantic shares on my behalf. I was however the beneficial owner o f those shares. I had no beneficial interest whatever in Coral Reef as that company was wholly owned by GMCT. The advance by GMCT to Coral Reef was secured by a pledge over the 344,333 Atlantic shares purchased together with a personal guarantee signed by myself. I also understand from inquiry that neither Coral Reef nor Ascot Holdings Limited - the other company referred to below - was ever registered as the owner o f the , shares acquired on my behalf. This suggests that they were held in the name o f another i entity. I say that I continued to make payments over the course of a number o f years in ■ an effort to reduce my debt to GMCT. ; 13. I also borrowed money (but this time as one o f three equal borrowers - myself, James 4 i i i ______________ ; ____________________________ ______________________________________ . McCarthy, and CJ Collins) through Ascot Holdings Limited (“Ascot”) in 1986 in a manner similar to that outlined above in respect o f Coral Reef. Ascot was used to purchase shares in Fitzwilton pic and Atlantic. It was also used for the payment o f debts owing by each o f us on our individual accounts, ie Coral R eef in my case. The first document I have in relation to Ascot is a letter dated 31 December 1986 from Mr. Furze to Mr. Traynor outlining the shares purchased by Ascot. There appears thereafter a letter from Mr. Traynor to me dated April 23 1987. This document refers to an advance to Ascot o f STG£149,408.92 "...to enable the various entities to meet their commitments”. The “entity” so far as I was concerned was Coral Reef. A s I have stated, I had no doubt but that I was the beneficial owner o f these shares, in whatever manner the transaction was structured from GMCT’s perspective. As far as I was concerned, these structures were essentially in Mr. Traynor’s/the bank’s hands, I having relied upon them in the first place to obtain the necessary loans. The third document in my chronology is a letter from Mr Des Traynor to Mr. Jim McCarthy dated 4 September 1987 referring to a conversation with me in relation to the Ascot loan. This is followed by a note o f Mr McCarthy’s o f September 20 1988 recording the provision by Mr. McCarthy o f two cheques on my behalf to Mr. Traynor in respect o f outstanding interest and capital. Invariably, payments in respect o f these loans were given to Des Traynor, GMCT’s representative in Ireland and the person who had arranged the loan. Due to the fact that the Atlantic shares had plummeted in value, my investment in the shares had been highly unsuccessful. Interest rates had risen steadily and I found that by 19901 was struggling to keep up with payments on the loan. Because o f the difficulties in keeping up these repayments, it became necessary for me to dispose o f some o f the shares and this is referred to in a letter o f 6 September 1989 to Jim McCarthy from Des Traynor and copied to me. Two subsequent letters dated 27 and 29 September 1989 record further disposal o f these shares. A letter o f January 10 1990 from Mr. Traynor to me records sale o f Fitzwilton shares by Mr. Furze generating a net amount o f STG£179,534.90, but a balance on our Ascot account due of STG£1,015,037.90. After this, on February 13, a facility letter was issued by Ansbacher Limited to Ascot Holdings Limited recording a facility o f STG£1,000,000 backed by 535,000 shares in Atlantic Resources pic, and 475,000 shares in Fitzwilton pic. It also necessitated a personal guarantee from Dr. AJF O’Reilly in respect o f this facility at that stage. Dr. O’Reilly is a long-standing personal friend o f mine. It will be noted that this document refers to these investments being registered in the name o f Overseas Nominees Limited, a wholly owned subsidiary o f the Company. A letter o f 14 February 1990 addressed to James McCarthy records a balance o f interest owing on the Ascot facility o f STO£28,141.83. By letter dated May 28 1990, Mr. Traynor confirmed to Mr McCarthy the use o f Ascot to cover interest and repayments due by us on our respective loan amounts. I also wish to refer to two parallel letters o f that date. By undated letter written shortly after June 6,1990, Mr McCarthy was advised that I had recently made repayments which amounted o f STG£5,700. This letter referred to the problems being encountered by the three o f us (being myself, Mr. McCarthy and Mr. Collins). On June 22 1990, Mr. Traynor recorded a further payment by me of STG£7,599.68, and by letter o f the same date the amount then outstanding for May was explained. A letter which was sent to me by the Moriarty Tribunal on 25 March 1999 reveals that a number o f cheques given to Des Traynor by me (in reduction o f my GMCT loan liabilities) ended up in the account o f Kentford Securities Limited, an account controlled by the late Des Traynor and from which payments were made for the benefit o f Charles J Haughey. It will be noted from the material supplied to me by the Moriarty Tribunal that by that stage I was reduced to selling shares and personal items to maintain payments on the debts. Certain of the cheques which have been drawn to my attention by the Moriarty Tribunal represent payments made to me by auction houses (James Adam and Taylor De Vere Art Auctions). I say that I would have simply endorsed those cheques to the bank in an effort to reduce my liabilities to the bank. These payments were in reduction o f my debt and not by way o f payment to Mr Haughey or any other person. This letter from the Moriarty Tribunal refers to four such credits. The first was credited on March 29 1990, and was in the amount o f IR£10,500.00. The second payment was credited on June 20 1990 and is in the amount o f IR£8,351.30. It will be seen that this j was comprised o f payments from James Adams, and Taylor De Vere Art Auctions as well as Ulster Bank. This is refared to in the letter from Mr. Traynor dated June 22 1990. The third was in the amount o f IR£5,528.20 and was from Taylor’s De Vere Art Auctions. The final payment was in the amount o f IR£3,342.50 and was credited to the i Kentford account on April 4 1991, the cheques being drawn on March 28 and 31 1991. 20. By letter dated January 141991, Ansbacher Limited recorded the facilities then available to Coral Reef Securities Limited, at that stage representing some STG£227,070.19, secured by my personal guarantee and shares in Atlantic Resources Limited. By note dated March 2 1992, Mr. Furze recorded this liability as being in the amount o f STG£262,153.37 out o f an initial advance o f STO£374,789.68 on which I had made repayments o f STG£346,832.73 and by letter dated October 15 1992, the amount was STG£287,425.23. On May 27 1993, Mr. Traynor wrote to me and advising me o f a change o f ownership o f the business, and o f the likely effects upon the calling in o f the loan. This is the last document I have dealing with the debts. 21. I was ultimately unable to maintain payments to GMCT and AJF O’Reilly had kindly agreed to guarantee my liabilities in respect o f Ascot. That guarantee was called in by the bank and paid off by AJF O’Reilly in 1998. AJF O’Reilly ultimately negotiated a settlement in respect o f the Coral Reef debt. . 22. I regret the absence of much o f the relevant documentation but, as mentioned previously in this statement, I have done my best to obtain all relevant records and am furnishing herewith those records which I have obtained. VINCENT FERGUSON Dated this 11th day o f February 2000 _SJ T H E H IG H C O U R T IN THE MATTER OF THE COMPANIES ACTS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES ACT 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R eport of th e Inspectors A p p o in t e d to E n q u ir e in to t h e A ffa ir s o f A n s b a c h e r ( C a y m a n ) L im ited Published by Order of the Court made on 24 June 2002 V o l u m e [ 1 5 ]: A p p e n d i x X V ( 1 6 8 ) t o X V ( 1 7 1 ) A ppendices X V I & X V II ISBN 0?7557?1355?9 Government of Ireland 2002 A p p e n d ix X V (168) M r J a m e s M c C a r t h y 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James McCarthy. a) Transcript o f evidence o f Mr James McCarthy dated 22 February 2000. b) Internal Guinness and Mahon memo of 19 April 1977 - JD Traynor to Pat O’Dwyer. c) Letter of 31 December 1986 - GMCT to JD Traynor. d) Letter of 31 December 1986 - JA Furze to JD Traynor. e) Letter of 13 February 1990 - Ansbacher Limited to Ascot Holdings Limited. f) Letter of 10 January 1990 - JD Traynor to Vincent Ferguson. g) Letter o f 28 May 1990 - JD Traynor to James McCarthy. UNDER OATH ON TUESDAY, 22ND FEBRUARY 2000 I hereby c e r t i f y the fo ll ow in g to be a t r u e and a c c u r a t e t r a n s c r i p t of my shor tha nd no te s i n the above named i n t e r v i e w . Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY BL S o l i c i t o r t o the I n s p e c t o r s MS. M. CUMMINS Interviewee: mr. james Represented by: MR. SIMON McALEESE McCarthy MATHESON ORMSBY PRENTICE 30 HERBERT STREET DUBLIN 2 I WITNESS EXAMINATION MR. J. MCCARTHY MS. MACKEY MR. ROWAN MR. JUSTICE COSTELLO 31 42 PAGE 30 42 55 1 2 3 4 MR. McALEESE: I suppose I should 5 in t r o d u c e myself f i r s t . 6 My name i s Simon McAleese, I am Mr. McCarthy's 7 s o l i c i t o r , with Matheson Ormsby P r e n t i c e . 8 MR. JUSTICE COSTELLO: 9 Thank you. We w i l l s t a r t our i n t e r v i e w then, 10 Mr. McCarthy. 11 r i g h t i s Ms. Mackey and on my l e f t i s Mr. Rowan. 12 We, as you know, a re the I n s p e c t o r s t h a t have been 13 ap poin te d by th e High Court. 14 nor i s i t a t r i b u n a l , i t i s an i n v e s t i g a t i o n and an 15 i n t e r v i e w in th e course of our i n v e s t i g a t i o n . 16 you want to ta k e l e g a l ad vice from Me. McAleese on 17 any q u e s t i o n t h a t we ask, p l e a s e t e l l me and we w i l l 18 s top , we w i l l pause, and i f Mr. McAleese wants to 19 give you any advice i n th e course of our 20 q u e s t i o n i n g , we w i l l pause and he can give the 21 a dv ic e . 22 t o a d m i n i s t e r th e oath to you. 23 24 25 26 27 28 29 My name i s Declan C o s t e l l o and on my This i s not a c ourt If We w i l l now ask our s o l i c i t o r , Ms. Cummins, 1 2 AS FOLLOWS 3 4 MR. MCCARTHY: I have a l i t t l e sta te m e nt 5 here which r e f e r s to my 6 memorandum. I t i s a m a t t e r of a d j u s t i n g a few 7 dates. 8 MR. JUSTICE COSTELLO: Yes. 9 MR. MCCARTHY: I t i s pa ragra ph 15 on page 5. 10 I t j u s t says, "The 11 second Medford loan was given around about th e same 12 time as th e f i r s t l o a n . " 13 "February 1986" in the f i r s t l i n e of parag rap h 15 of 14 my s ta te m e nt should read "March 1984". 15 MS. MACKEY: 1984? 16 MR. MCCARTHY: Yes. 17 Th eref ore , th e words Otherwise, my st a t e m e n t i s t r u e and 18 c o r r e c t , to th e b e s t of my r e c o l l e c t i o n . 19 a f u r t h e r s ta te m e n t t h a t my s o l i c i t o r s have r e c e i v e d 20 a l e t t e r from Ansbacher (Cayman) r e f u s i n g t o pr ovi de 21 documentation r e l e v a n t to my p a s t lo a n s . 22 MR. JUSTICE COSTELLO: Then j u s t Yes, very w e ll . 23 Mr. McCarthy, I am going 24 t o ask Ms. Mackey to ask you some q u e s t i o n s f i r s t . 25 26 27 28 29 mr. McCarthy was examined, as follows, by ms . mackey 1 s ta te m e nt he re , which has been very h e l p f u l , and I 2 j u s t want to ask you a c e r t a i n number of q u e s ti o n s 3 i n r e l a t i o n to i t , 4 t h a t you have pro vi de d with i t . 5 t o r e f e r to any document, we w i l l pass you a copy of 6 i t and to your s o l i c i t o r so t h a t you can look a t i t . 7 A. 8 2 Q. 9 and in r e l a t i o n t o th e documents I n s o f a r as I want Yes. J u s t f o r th e re c o r d , would you t e l l us a l i t t l e b i t about your own c a r e e r and your p r e s e n t p o s i t i o n ? 10 You were, I t h i n k , a D i r e c t o r of D ock rel l; i s t h a t 11 correct? 12 A. Yes. I was o r i g i n a l l y from Cork, as you might 13 g a t h e r , and my b u s in e s s J . S . McCarthy, Cork, was 14 bought by th e F i t z w i l t o n Group in about 1972. 15 was bought, a c t u a l l y , by a s u b s i d i a r y of F i t z w i l t o n 16 named D o c k re l ls . 17 Managing D i r e c t o r . 18 main board f o r a number of y e a r s . 19 F i t z w i l t o n so ld o f f a l o t of t h e i r management 20 companies and became, r e a l l y , an inve stment v e h i c l e 21 and I, with th e p a r t n e r s h i p of William Mawlinson and 22 Denny Mott, a l a r g e E ngl ish timber company, bought 23 out th e Dockrell Group. 24 3 Q. 25 A. It Then I went i n t o D oc kre ll s as I was a l s o on th e F i t z w i l t o n Then about 1977 You did? I did, yes, with William Mawlinson and Denny Mott, 26 and two or t h r e e - - t h r e e , a c t u a l l y , of th e top 27 Managers in th e Group. 28 Chief Executive/Managing D i r e c t o r of D o c k re l ls , and 29 I was a l s o on th e board of F i t z w i l t o n and some o t h e r So, t h a t l e f t me as the 1 companies, Independent newspapers, and companies 2 connected with F i t z w i l t o n . 3 4 Q. 4 A. I see. Then, D o c k re l ls , in th e mid 8 0 ' s, with th e slump in 5 th e b u i l d i n g i n d u s t r y , were themselves i n a p r e t t y 6 serious fin a n c ial s ta te . 7 a very s e r i o u s f i n a n c i a l s t a t e . 8 ta ke n then t h a t th e y should s e l l o f f a l l th e p i e c e s 9 of th e B u il d e r s Pr ovid er s Company, which th e y did, In f a c t , you could say in A d e c i s i o n was 10 mostly to th e Managers. 11 who were myself and my b r o t h e r , William Mawlinson 12 and Denny Mott, to a l l i n t e n t s and purposes l o s t a l l 13 of th e money th e y o r i g i n a l l y i n v e s t e d . That would, 14 s i r , be th e high and low of my c a r e e r . Since then, 15 I r e t i r e d f i v e ye ars ago, and I have been on a 16 number of boards and t h i n g s l i k e t h a t . 17 5 Q. 18 19 The o r i g i n a l s h a r e h o l d e r s , A f t e r th e c o l l a p s e of D o c k re l ls , what d id you do then? A. A f t e r th e D oc krell s t h i n g , I went i n , a c t u a l l y , and worked f o r F i t z w i l t o n . 20 21 6 Q. 22 A. You worked f o r F i t z w i l t o n ? Yes, F i t z w i l t o n then were expanding and I was put 23 not q u i t e in charge, but to look a f t e r c e r t a i n 24 i n t e r e s t s th e y had in th e UK and i n I r e l a n d , and 25 a l s o I was inv o lv ed as an Executive D i r e c t o r of 26 Arcon. 27 7 Q. 28 A. 29 Arcon? Arcon, which in f a c t was th e son or da ugh ter of A t l a n t i c Resources. 1 8 Q 2 A 3 9 Q 4 A Of? Of A t l a n t i c Resources. Oh, A t l a n t i c Resources. A t l a n t i c Resources was merged, or ta k en over you 5 could say. 6 th e n c a l l e d Conroy Petroleum. 7 Resources main s h a r e h o l d e r s , in f a c t , became the 8 b i g g e s t s h a r e h o l d e r s in Conroy, and t h e y changed 9 t h e i r name to Arcon. 10 10 Q But, th e A t l a n t i c What year di d you become Executive D i r e c t o r of Arcon, roughly? 11 12 I t was a share swop done with what was A 13 I would have to make a guess a t t h a t , but I would say i t would have been 1997. 14 11 Q 15 A 16 12 Q 1997? Yes . That i s f i n e . Thank you very much, Mr. McCarthy. 17 Now, j u s t to get down to your s ta t e m e n t, you have 18 e x p la i n e d to us in your st a t e m e n t t h a t your d e a l i n g s 19 with th e company, which we c a l l "Ansbacher", were in 20 r e l a t i o n to loans t h a t you o b ta in e d f o r th e purchase 21 of sh ar es in A t l a n t i c Resources; i s t h a t c o r r e c t ? 22 A 23 13 Q 24 A 25 14 Q That i s c o r r e c t . Do you have a copy of your st a t e m e n t with you? I have i t here, yes. I f I could r e f e r to page 4 of the st a t e m e n t and the 26 p a r t beg innin g a t para gra ph 11, where you r e l a t e to 27 us t h a t you were on th e board of A t l a n t i c Resources 28 a t t h a t time? 29 1 "I r e q u i r e d fi na nc e f o r t h i s inve stment 2 ff 3 4 That was th e purchase of s h a r e s . 5 "Such fi n a n c e was arra ng ed by Des Traynor, then a prominent and r e s p e c t e d bu s i n e s s man, e t c . " 6 7 8 Had you known Des Traynor f o r a long time a t t h a t 9 pe rio d? 10 A I had known Des Traynor - - t h a t a l l happened in 11 1984, so I would have known Des Traynor s in c e about 12 1972 . 13 16 Q 14 A How d id you f i r s t ge t to know Mr. Traynor? Well, I got to know Mr. Traynor and Guinness & 15 Mahon, g e n e r a l l y , because in 1972/73 we had an 16 o p p o r t u n i t y of i n v e s t i n g in Tara Mines. 17 17 Q 18 A 19 We be ing . . . ? ( INTERJECTION). Sorry, excuse me. Myself and Tony O ' R e i l l y and Guinness & Mahon. 20 18 Q And Guinness & Mahon? 21 A And Guinness & Mahon. 22 19 Q 23 A An o p p o r t u n i t y of i n v e s t i n g in Tara Mines? And, in f a c t , F i t z w i l t o n , as wel l, had an investment 24 in i t . 25 Hughes, who was then Chief Executive of Tara Mines, 26 to i n v e s t in th e company, and we borrowed about 27 $7 m i l l i o n . 28 was allowed a g a i n s t your t a x . 29 There was an o p p o r t u n i t y given t o us by Pat But, a t t h a t time i n t e r e s t on borrowing 1 2 In f a c t , we borrowed th e money from them. 3 took, I t h i n k , some of th e e q u i t y . 4 J u s t t o be c l e a r about t h i s . 5 Traynor f i r s t when you approached Guinness & Mahon 6 or d id you approach Guinness & Mahon and meet 7 Mr. Traynor t h a t way? 8 A 9 They a l s o Did you know Des That i s th e way we did i t , yes, we approached Guinness & Mahon. 10 22 Q 11 A Can I ask you why you approached Guinness & Mahon? Well, Guinness & Mahon, as I was going t o e x p la i n 12 l a t e r on, Guinness & Mahon, you see, were pro bably 13 one of th e few merchant banks in Dublin. 14 - - th e major banks — t h i s was a c t u a l l y share 15 p u rc ha si ng in a mine up in Navan. 16 are q u i t e slow to loan you money f o r share 17 p ur c h a si n g . 18 buying i n t o an ongoing s i t u a t i o n t h e r e . 19 remember which one of our group knew Des Traynor, 20 but I know t h a t I met him through t h a t t h i n g , which 21 t u r n e d out to be a very s u c c e s s f u l inve stment f o r 22 me. 23 t o s t a y t h e r e once i n t e r e s t w a s n ' t allowed a g a i n s t 24 your t a x anymore, we j u s t had to s e l l out and we 25 were lucky to ge t the r i g h t buyer. 26 23 Q 27 A 28 24 Q 29 They were The major banks Tara was s l i g h t l y - - I mean, we were I cannot But, q u i t e h o n e s t l y , we d i d n ' t have th e f in a nc e I t was in t h a t c o n te x t you met Mr. Traynor? Yes . Did you then develop a b u s i n e s s , p r o f e s s i o n a l or s o c i a l r e l a t i o n s h i p ...(INTERJECTION). 1 A. No, I d i d n ' t meet Des Traynor then - - I was never 2 s o r t of c l o s e l y a s s o c i a t e d with Des Traynor on the 3 b u s i n e s s s id e of i t . 4 b u s i n e s s and i t worked out well f o r us. 5 years a f t e r t h a t , p r o p e r t y became a v a i l a b l e up in 6 Bride S t r e e t f o r s a l e . I t was t h e r e f o r q u i t e a 7 while with no o f f e r s . So, we he ard - - a t l e a s t we 8 imagined a t th e time ...(INTERJECTION). 9 25 Q. 10 A. We then di d t h a t s o r t of Then, some Sorry, "we" ag ain being th e same group as be fo re ? No, no. In f a c t , t h i s was Des Traynor on a p e r s o n a l 11 b a s i s , Sam Stevenson th e a r c h i t e c t , Tony O ' R e i l l y 12 and myself. 13 26 Q. Now, can I j u s t st o p you t h e r e f o r th e moment 14 because I would l i k e to ta k e t h i s slowly and ge t i t 15 c l e a r what happened? 16 A. 17 27 Q. 18 Yes, I hope I am not con fus ing you. Not a t a l l . I t i s j u s t to ge t i t s ta g e by s ta g e so t h a t we a re a b s o l u t e l y c l e a r . 19 A. 20 28 Q. 21 Yes. You met Mr. Traynor i n i t i a l l y when you embarked on t h i s ve n tu re in Tara Mines? 22 A. 23 29 Q. 24 In Tara, y e s . You d i d n ' t , you s a i d to me, develop a c l o s e b u s i n e s s r e l a t i o n s h i p with him a t t h a t time? 25 A. 26 30 Q. 27 Not r e a l l y , no. But, n e v e r t h e l e s s , some ye ars l a t e r you were invol ve d, as you say, a t a p e r s o n a l l e v e l ? 28 A. 29 31 Q. Right. Had t h e r e been some c o n t a c t in-between? 1 Not r e a l l y , no. 2 l i t t l e property deal. 3 32 Q 4 A The next one would have been t h i s How did he become invol ve d in t h a t with you? Again, we were lookin g f o r money. I t would be a 5 p r e t t y n a t u r a l t h i n g t h a t i f you had done a 6 s u c c e s s f u l de al with a merchant bank, t h a t th e y ar e 7 p r e t t y happy to accommodate you a g ai n. 8 a l o t of d e a l s looked a good i d e a . 9 Des Traynor ...(INTERJECTION). 10 33 Q So, we went to That i s to say you, Tony O ' R e i l l y and Sam Stevenson went to Des Traynor? 11 12 At th e time A Yes, and he put in about £200,000 a t th e time. 13 There was a r e n t coming in on the p r o p e r t y . 14 the p r o p e r t y had been l e t o f f as garages or t h i n g s 15 l i k e t h a t and t h e r e was a r e n t coming i n o f f t h a t . 16 But, a t th e end of the day, i t j u s t tu r n e d out to be 17 a loss s itu a tio n . 18 would say, f i v e or s i x year s and th e n we j u s t had to 19 sell it. 20 34 Q 21 22 P a r t of We hung onto th e p r o p e r t y f o r , I The four of you had purchased t h a t p r o p e r t y , and t h a t was Mr. Traynor in a p e r s o n a l c a p a c it y ? A 23 Well, can I j u s t say t h i s to you about th e Guinness & Mahon people? 24 35 Q 25 A Yes . You were never, i t might sound s t u p i d t o say, but 26 you are never too sure - - th e only t h i n g you knew 27 was you were g e t t i n g the money from Guinness & 28 Mahon. 29 knowledge, took e q u i t y in a s i t u a t i o n i f th e y f e l t Guinness & Mahon, to th e b e s t of our 1 i t was a good one. 2 Traynor was a p e r s o n a l i n v e s t o r , but i t would be 3 wrong of me to say t h a t as a d e f i n i t e t h i n g . 4 Des was r e p r e s e n t i n g e i t h e r th e bank or o t h e r 5 pe op le . 6 had 25%, and of course th e y gave us th e money as 7 w ell. 8 36 Q 9 Now, from what I g a t h e r , Des Maybe But, as f a r as we were concerned, he always That was th e next occas ion in which you were in vo lve d with Mr. Traynor. 10 A 11 37 Q 12 A That was th e next occa si on, yes. Then, a f t e r t h a t ? The next oc cas io n then I had with him was, in f a c t , 13 t h i s A t l a n t i c Resources. 14 i f t h e r e was a n o th er occa si on, I d o n ' t remember i t . 15 38 Q I have t o say t h i s much; In-between t h i s ve n tu re in Bride S t r e e t and the 16 A t l a n t i c Resources, di d you keep i n c o n t a c t with 17 Mr. Traynor? 18 A 19 39 Q 20 A No. You d id not? No. I would see him the odd time a t some meeting or 21 something l i k e t h a t . 22 between F i t z w i l t o n , I t h i n k , and th e New I r e l a n d 23 In su rance Company and I t h i n k Des Traynor was e i t h e r 24 the chairman or something l i k e t h a t . 25 on very f r i e n d l y terms, I must say. 26 40 Q 27 A 28 29 There was a mutual i n t e r e s t I t was always Did you meet him s o c i a l l y duri ng t h a t time? No, I never met him s o c i a l l y , except a t th o s e kind of t h i n g s , you know. 41 Q Yes, I un d e rs ta n d . 13 At th e time, i n 1983/84, when 1 you wished to arra nge th e fi na nc e f o r th e A t l a n t i c 2 Resources s h a r e s , you went to Mr. Traynor. 3 what happened? 4 A. Is t h a t I should say t h a t A t l a n t i c Resources was, you could 5 say, an e x p l o r a t i o n sh a r e . 6 Tara Mines. 7 we would have gone, a group of us - - Mr. Ferguson, 8 Mr. C o l l i n s and myself, we were on th e board of 9 A t l a n t i c Resources and s h a r e h o l d e r s . I t was d i f f e r e n t than I t was an e x p l o r a t i o n s h a r e . I think There had 10 been a s u c c e s s f u l o i l s t r i k e o f f th e south c o a s t of 11 Cork and t h i n g s looked t e r r i f i c a t th e time and i t 12 was a m a t t e r of how l a r g e was the f i e l d , e t c , e t c . 13 So, t h e r e was a p l a c i n g . 14 b u s i n e s s , I should e x p l a i n , i f you wanted to 15 p a r t i c i p a t e in a d r i l l i n g programme you would have 16 to have a p l a c i n g in ord e r to ge t th e money to do 17 it. 18 company, th e y would have to pro ba bl y ge t t h e i r sh are 19 of whatever i t was - - I cannot remember a t th e time, 20 maybe i t was 10% or 15%. 21 that. 22 say the y were going to d r i l l what t h e y c a l l 23 step-ups. So, we had a s t r i k e t h e r e i n th e c e n t r e 24 of t h a t . Then, to d e l i n e a t e th e s i z e of th e f i e l d , 25 th e y would d r i l l th e well out t h e r e . Then, i f t h e r e 26 was no thi ng th e y would come in a b i t . So t h a t f o r 27 each d r i l l i n g programme you had t o put up your money 28 or e l s e you were d i l u t e d . 29 the s t r i k e , we looked f o r more money, we wanted to You see, i n t h a t type of So, w e ' l l say A t l a n t i c Resources, which was our I t w a s n ' t even as b ig as Gulf Oil were the o p e r a t o r s and t h e y would I n v a r i a b l y , th e n , a f t e r 1 p a r ti c ip a te ourselves. 2 concerned, t h e r e would be no q u e s t i o n — two 3 re a s o n s . 4 give you a loan f o r what was then r e a l l y a 5 sp eculative share. 6 p e r s o n a l l y , I p e r s o n a l l y w ou ld n 't have got any money 7 from them because I was in D o c k re l ls , which was a 8 doomed b u s i n e s s in the 1980' s , l i k e e v e r y th in g 9 connected with th e b u i l d i n g i n d u s t r y . U n f o r t u n a t e l y , where I was F i r s t of a l l , th e major banks would not The second re aso n f o r me, So, I would 10 have had no ready cash to put i n t o i t a t t h a t time, 11 i n the s u b s t a n t i a l amount th e y wanted. 12 to - - I am s o r r y , I am going on and b i t now. 13 42 Q. 14 A. Then, I went Not a t a l l . So, I / m y s e l f went to Guinness & Mahon. At t h a t 15 time, you would want to u n de rs ta nd , o i l e x p l o r a t i o n 16 b u s i n e s s was l i k e a gold rus h. 17 43 Q. 18 19 Yes, I f know. A. Everyone was g e t t i n g in and g e t t i n g ou t, would make 20 a f o r t u n e and l o s i n g money. 21 gambling t h i n g . 22 c our se. 23 had done b u s i n e s s with him and he was always 24 f r i e n d l y , and he spoke to us and we went i n and 25 . . . (INTERJECTION). 26 44 Q. A ll t h a t was a r e a l This i s a l l with h i n d s i g h t , of So, we went to Des Traynor th e n because we Sorry, j u s t to focus i t a l i t t l e b i t , d id you go to 27 Mr. Traynor with th e i n t e n t i o n of g e t t i n g f in a nc e 28 from Guinness & Mahon, as on th e pr e v io u s occasion? 29 1 45 Q 2 A 3 46 Q 4 Yes, d e f i n i t e l y . I t was Mr. Traynor in Guinness & Mahon who you approached d i r e c t l y ; i s t h a t r i g h t ? 5 A 6 47 Q 7 A Yes . What did he propose to you? Well, we d i d n ' t even meet him, we a c t u a l l y c a l l e d 8 him up and we s a i d , "Look, we want t o p a r t i c i p a t e in 9 t h i s p l a c i n g , Des," and t h i s , t h a t and th e o t h e r thing. 10 11 48 Q 12 A There had been, as I s a i d , a s t r i k e . Yes . He was very i n t e r e s t e d and s a i d , "Well, look, I w i l l 13 have to t h i n k about i t , 14 and I w i l l come back to y o u , " which he d id a f t e r 15 about a day or a day and h a l f and s a i d words to the 16 e f f e c t of, "Okay, we w i l l go ahead. 17 have o t h e r c l i e n t s , " which might have been 18 themselves f o r a l l I know, "who would be i n t e r e s t e d 19 i n p a r t i c i p a t i n g in a p l a c i n g . " 20 would give - - I t h i n k my own amount was £330,000. 21 49 Q 22 We pro bably Then he s a i d he Did you un d e rs ta n d t h a t to mean Guinness & Mahon? 23 A 24 50 Q 25 26 He s a i d to you "we". I w i l l have t o d i s c u s s i t No, I am s o r r y . No, but he s a i d to you "We w i l l give you f i n a n c e " ; is th at right? A By "we" I meant th e t h r e e of us. No, you a re n o t. Sorry, maybe I . . . (INTERJECTION). In f a c t , I suppose, yes, t h a t i s 27 pro ba bly th e a c t u a l words. 28 effect, 29 he s a i d th e bank or - - I cannot remember th e words, "We w i l l . . . " He s a i d words t o t h a t I d o n ' t now remember whether 1 but th e f a c t i s he s a i d "We w i l l give you the 2 fi n a n c e and I w i l l s e t up th e v e h i c l e which we w i l l 3 do i t th r o u g h . " 4 handle e v e r y th in g , i n c l u d i n g th e buying of the 5 s h a r e s , " which he went ahead and d id . 6 have used Guinness & Mahon Cayman as a v e h i c l e . " 7 51 Q. He s a i d , "I w i l l He s a i d , "I Now, d id he t e l l you t h a t a f t e r he had done i t or be fo re ? 8 9 So, we were i n . A. I must say he t o l d us t h a t pro ba bly a t around the 10 same time, he j u s t proba bly s a i d i t . 11 say i t was not l i k e , 12 we w i l l give you th e money." 13 us th e money, but i t r e a l l y w a s n ' t an impor tant 14 f e a t u r e of how he s e t i t up. 15 52 Q. 16 But, I must " I f you come i n t o t h i s v e h i c l e He was going to give What I need to get c l e a r here i s - - j u s t lookin g a t your s ta te m e nt here a t pa ra grap h 12, you say: 17 "Mr. Traynor s t a t e d t h a t he could a rra ng e fi n a n c e f o r us through the company then known as Guinness Mahon Cayman Tr us t Li m ite d. " 18 19 20 A. 21 53 Q. Yes. My u n d e rs ta n d in g of t h a t sen te nc e would be t h a t i t 22 was th e company t h a t was going to fi n a n c e you. 23 t h a t what you mean to say t h e r e ? 24 A. 25 54 Q. 26 A. 27 55 Q. 28 29 Is You mean th e bank? Guinness Mahon Cayman Tru st? Oh, yes, yes. So, you were borrowing from Guinness Mahon Cayman Trust? 1 56 Q Now, did you u n de rs ta nd t h a t to be th e case a t the 2 time or did you t h i n k you were borrowing from 3 Guinness & Mahon? 4 A Well, I must say Guinness & Mahon was j u s t Guinness 5 & Mahon to me. 6 honest with you, a t th e time I r e a l l y d id not give a 7 damn once I got th e money. 8 saying i t , 9 got the money, but g e t t i n g th e money was what I was I was not r e a l l y - - t o be q u i t e I t i s an off hand way of I know, t h a t I d i d n ' t give a damn once I 10 most i n t e r e s t e d in to put i n t o t h i s ma rvellous new 11 v e h i c l e we were going to make a p r o f i t out of. 12 Sorry, you asked me a n o th er q u e s t i o n t h e r e . 13 57 Q No, t h a t was my q u e s t i o n : Did you know a t t h a t time 14 t h a t you were not borrowing from Guinness & Mahon 15 but t h a t you were borrowing from t h e i r o f f - s h o r e 16 subsidiary? 17 A No, and, in f a c t , i t i s i n t e r e s t i n g , a l l of the 18 cheques t h a t I gave Des Traynor, up t o th e t h r e e 19 famous cheques t h a t tu r n e d up in . . . (INTERJECTION). 20 58 Q Kentford. They were a c t u a l l y made out t o Guinness 21 Mahon. 22 not become aware t h a t i t was done through t h i s 23 con voluted way t h a t he di d i t in th e end? 24 59 Q But, I would be wrong now t o deny t h a t I did Okay, wel l, maybe I cut a c r o s s you t h e r e and you 25 were going to e x p l a i n to me how he s e t i t up f o r you 26 th e n . 27 through Guinness & Mahon Cayman Trust? 28 29 A He s a i d to you t h a t i t would be fin a nc ed That i s r i g h t . 1 2 61 Q 3 A 4 62 Q 5 A How di d he s e t i t up? Well, he bought th e s h a r e s . He, p e r s o n a l l y ? Well, s o r r y , I keep on saying "he". Well, the v e h i c l e , I presume, bought th e s h a r e s . 6 7 What d id he do then? 63 Q I t h i n k , acc ord ing to your st a t e m e n t her e, 8 Mr. McCarthy, he o rg a n is e d t h a t a company, which was 9 a Guinness Mahon Cayman Tr ust nominee company c a l l e d Medford, would buy the s h a r e s ; i s t h a t c o r r e c t ? 10 11 A T h a t ' s r i g h t , yes, but t h i s was not a t h i n g t h a t was 12 kind of pre pla nn ed , I am going to do t h i s , t h a t and 13 the o t h e r . 14 e v e r y th in g and buy the s h a r e s . " 15 saying " I " , he meant the bank. 16 t a l k i n g about th e bank. 17 am not a f i n a n c i a l pers on. 18 t h a t much aware of the d i f f e r e n c e between Guinness & 19 Mahon and Guinness Mahon Cayman T r u s t. 20 64 Q He j u s t s a i d "I w i l l look a f t e r I am s o r r y f o r In my view, he was I r e a l l y was not aware, I So, I was not r e a l l y Did he e x p l a i n to you a t any s ta g e why th e loan was 21 coming from Guinness Mahon Cayman Tr us t r a t h e r than 22 Guinness & Mahon i t s e l f , 23 fi n a n c e in th e p a s t ? 24 A from which you had got Well, i f he did, Ms. Mackey, I cannot remember i t . 25 I must say t h a t maybe he did, but i f he d id I cannot 26 remember. 27 Okay. 28 company Guinness Mahon Cayman Tr u st a t th e time? 29 I d o n ' t want to say he d i d n ' t . Now, d id he t e l l you any th in g about t h i s 1 Well, can I say t h i s ; in my view, a t t h a t time, I 2 was d e a l i n g with Guinness & Mahon/Des Traynor, an 3 honourable man and a most honourable bank, with 4 Jonathan Guinness the chairman. 5 Guinness & Mahon did, I would have ta ke n as, w ell, 6 t h a t i s f i n e , t h a t i s okay, t h e r e i s no problem 7 there. 8 e s p e c i a l l y when we s t a r t e d g e t t i n g our r e q u e s t s f o r 9 i n t e r e s t , he c e r t a i n l y must have t o l d us then t h a t So, Des who prob ab ly must have t o l d us, i t was Medford. 10 11 So, anything 66 Q Medford, anyway, was going to do th e buying and the 12 s e l l i n g of th e s h a r e s . 13 c l e a r to you or di d you ask Mr. Traynor t o have the 14 buying and s e l l i n g of th e s h a r e s o r g a n is e d in 15 something o t h e r than your name? 16 A 17 67 Q 18 19 Did Mr. Traynor make i t No. How d id t h a t come about then? What was th e purpose of Medford? A Well, from what I can g a t h e r with h i n d s i g h t , the 20 purpose seemingly was t h a t a t a l l times Guinness & 21 Mahon - - now, d o n ' t mind me us in g Des Traynor, 22 because I have to say t h a t Des Traynor, t h a t he 23 would have c o n t r o l of th e buying and th e s e l l i n g of 24 the s h a r e s . 25 68 Q 26 A What was th e re aso n f o r t h a t ? I can only say t h a t t h a t i s pro ba bl y th e way t h a t 27 t h e s e merchant banks, who took e q u i t y s ta k e s 28 themselves, worked, t h a t th e y j u s t w ou ld n 't hand you 29 out a major loan and allow you to have freedom of 1 when you are going to s e l l them. 2 sh ar es had gone up c o n s i d e r a b l y i n val ue, I t h i n k 3 t h a t maybe th e y wanted to have the power t o s e l l 4 them i f th e y thought th e y should. 5 s e l l e r of t h i n g s , so a l l I am saying maybe t h a t i s 6 th e reason th e y wanted to do i t . 7 t o have command, obvio us ly, and i n a way you 8 w ou ld n' t blame them f o r wanting t o do t h a t , of the 9 shares. 10 69 Q 12 A I am a hop eless But, t h e y wanted In what way were you b e n e f i c i a l owner of t h e s e sh ar es ? 11 Supposing t h a t the What power had you or . . . (INTERJECTION). Well, i t i s i n t e r e s t i n g . They say t h e r e i n one of 13 th e l e t t e r s , which you pro ba bl y rea d, t h a t I was the 14 b e n e f i c i a l owner. 15 70 Q 16 17 Well, you say t h i s y o u r s e l f , Mr. McCarthy, in your s ta te m e nt ? A That i s r i g h t , yes, but I have been a dv is e d s in c e 18 t h a t in f a c t I was not th e b e n e f i c i a l owner. 19 could say t h a t I am th e b e n e f i c i a l owner here , but 20 i n f a c t , through some l e g a l t h i n g or an o th er , t h a t I 21 had no c o n t r o l over th e s h a r e s . 22 t o l d , anyway, by l e g a l people and by f i n a n c i a l 23 pe op le . 24 n o t. 25 71 Q They That i s what I am I would not know whether t h a t i s t r u e or I mean, my name i s o b vio us ly on th e l i n e . I t appears from your s ta te m e n t and from documents 26 t h a t you a t t a c h e d to i t t h a t th e s ha r es were not 27 r e g i s t e r e d in th e name of Medford? 28 A 29 72 Q That's rig h t. But were r e g i s t e r e d i n th e name of some o t h e r 21 1 2 3 7 3 Q. 4 A. 5 7 4 Q. 6 A. What do you know about t h a t ? I know no thi ng about t h a t whatsoever. Did you know t h a t a t th e time? Do you know, I must say, I j u s t d i d n ' t c a r e , you 7 know. I d i d n ' t s o r t of t h i n k about t h i n g s l i k e 8 that. I was d e a l i n g with Guinness & Mahon and with 9 Des Traynor - - s o rr y , I know I am r e p e a t i n g myself 10 - - people t h a t I knew and t r u s t e d and I j u s t thought 11 an yt h in g th e y d id was th e r i g h t way t o do i t . 12 C e r t a i n in f o r m a t io n i s coming to me now, but I say 13 t h a t with h i n d s i g h t t h a t , Des, in f a c t , you might 14 say t h a t was a s i l l y t h i n g to do, w a s n ' t i t ? 15 you have done s u c c e s s f u l d e a l s with banks and t h i n g s 16 l i k e t h a t , you r e a l l y t h i n k t h a t t h e y are doing the 17 rig h t thing. 18 75 Q. Okay. When I f we could move on a l i t t l e b i t from t h a t 19 and i f I could ask you, in r e l a t i o n t o th e cheques 20 t h a t you gave to Mr. Traynor from time t o time in 21 or d e r to make th e loan repayments, you s t a t e in your 22 s ta te m e nt here t h a t from to time t h e s e 23 . . . (INTERJECTION). 24 A. 25 76 Q. 26 I t i s page 8, a c t u a l l y , th e top of page 8, paragraph 20 . 27 A. 28 77 Q. 29 What page are you on, p l e a s e ? Yes. R e f e r r i n g to th e t h r e e payments t h a t went i n t o Kentford. 1 2 78 Q 3 A 4 79 Q 5 6 They were made payable to cash. I t h i n k you s a i d t h a t from time t o time cheques were made payable to cash? A 7 No, s o r r y , Ms. Mackey, i t was only th e l a s t t h r e e c heq ue s . 8 80 Q 9 A 10 81 Q 11 A The l a s t t h r e e cheques? Yes . Why were th e y made payable to cash? I t h i n k th e reason they were made payable t o cash i s 12 t h a t Des Traynor was in Guinness & Mahon up to about 13 1986 t o 1987, and Des Traynor then was out of the 14 bank and was chairman of a couple of companies, 15 in c l u d i n g CRH and Aer R ia nta, or something l i k e 16 t h a t , and he had an o f f i c e l i t e r a l l y down th e s t r e e t 17 from where I had an o f f i c e . 18 l i v i n g in Cork, th e o t h e r was l i v i n g i n Sl i g o , and I 19 t h i n k Des pr obab ly found me - - I am going around i t 20 i n a roundabout way now - - pro ba b ly found me the 21 e a s i e s t guy to de al with, being up th e s t r e e t . 22 was i t you a re a ski ng me now again? 23 82 Q 24 A 25 One of my p a r t n e r s was What I asked you why th e cheques were made out t o cash? Why th e cheques were made out to cash. He l e f t the bank the n, say, about 1986 or 1987. 26 83 Q 27 A Yes, t h a t i s r i g h t . I used to go over to Des with the cheques. The 28 r ea son I used to go over to Des with th e cheques 29 r a t h e r than sending them over was because I always 1 had a sob s t o r y . 2 w i l l read in th e correspondence t h e r e . 3 i n c l i n e d to give him cheques f o r I r i s h and he would 4 say, no, he wanted S t e r l i n g . 5 i t i s an t h i n g to do, but th e f a c t i s t h a t I gave 6 him a cheque and I was always s h o r t - - not always, 7 but n e a r l y always s h o r t . 8 t e l l him about t h i s , t h a t and o t h e r problems I had. 9 84 Q. 10 A. I was n e a r l y always s h o r t , you I was You might s o r t of say So, I had a sob s t o r y to So why were th e y made out to cash? I t h i n k t h a t I must have s a i d to Des, t h a t I 11 pro b a bly brought th e cheque over with me, I am 12 assuming, and Des was always t a l k i n g about going to 13 th e Caymans on Fr ida y or Fr ida y week or Fr iday a f t e r 14 t h a t , and "I must have them." 15 assume t h a t I had made a l l my o t h e r cheques out to 16 Guinness & Mahon and I d i d n ' t know who t o make th ose 17 cheques out to or what to do, because I knew Des was 18 no lo n g e r in Guinness & Mahon and he was running h i s 19 Ansbacher b u s i n e s s from CRH o f f i c e s . 20 have s a i d to Des, "Who w i l l I make th e cheques out 21 to ? " 22 we w i l l do i s I am going out today, so you b e t t e r 23 make i t out to c a s h ." 24 85 Q. 25 26 Now, I can only So, I must He must have s a i d , "Look, I am not s u re . What So, i t would have been Mr. Traynor who asked you to make i t out to cash? A. I t would have been, yes. Also, could I j u s t say, 27 t h a t when you are s o r t of in f i n a n c i a l d i f f i c u l t i e s , 28 you know - - I am be ing a b i t f a c e t i o u s by saying you 29 would make i t out to Satan, j u s t t o kind of, you 1 know. 2 th e time. 3 16 Q. Things l i k e t h a t j u s t w e r e n ' t imp or tan t a t I can u n de rs tand t h a t . Can you remember a l i t t l e 4 b i t more about him asking you to make th e cheques 5 out t o cash? 6 i n f a c t , you were paying them to th e same e n t i t y . 7 Whether Des Traynor was in Guinness & Mahon a t t h a t 8 time or not, your loan was with th e same company 9 t h a t i t always had been? 10 A. Did he give you any reason? Because, Yes, and I di d ge t acknowledgments of them and i t 11 c e r t a i n l y showed c r e d i t . 12 gave me an e x p l a n a t i o n or n o t. 13 very p l a u s i b l e because I never thought about i t f o r 14 a second. 15 ]1 Q. Okay, grand. I d o n ' t know whether he I f he did, i t was Now, from time to time, you t o l d us in 16 your s ta t e m e n t, Mr. Traynor s e n t you s o r t of 17 s t a t e m e n ts of what you owed or b a la n c e s and so on? 18 A. 19 ]Q Q. 20 A. Yes. In what form did t h e s e come? That i s what I would get from him and th e n you might 21 have n o t i c e d here and t h e r e I would ge t th e odd 22 l i t t l e note , you know. 23 i9 Q. 24 25 There would be simply a note t h a t you owed now so much i n t e r e s t ? A. That i s r i g h t . A t y p i c a l note would be, page 4, 26 say, " t h e r e i s an en clo se d cheque f o r £67,000 being 27 the I r i s h pound v a l u a t i o n of £60,0 00. " 28 converse l i k e t h a t . 29 up j u s t lookin g f o r what he s a i d t o me. We would O c c a s i o n a ll y , he might r i n g me He used to 1 obv io us ly ge t t h e s e l e t t e r s from John Furze and he 2 used to send them on to me. 3 90 Q. 4 Well, would you ever get a st a t e m e n t from th e Cayman bank s e t t i n g out your loan account? 5 A. 6 91 Q. 7 A. I never. You never got ...(INTERJECTION). I never met John Furze or never had any d i r e c t 8 correspondence from him. 9 t h e r e from him . . . (INTERJECTION). 10 92 Q. Yes, I see t h a t . There i s one l e t t e r in Did i t not s u r p r i s e you t h a t you 11 w o u ld n 't ge t what you would normally ge t from the 12 bank when you have a loan account, a sta te m e nt 13 s e t t i n g out what your ba lanc e was . . . (INTERJECTION). 14 A. No. I have got to say i t should have s u r p r i s e d me, 15 but i t d i d n ' t , r e a l l y , a t th e time. 16 whole way t h a t Guinness & Mahon, t h e y had q u i t e an 17 inf or ma l way of doing b u s i n e s s , not l i k e your us ua l 18 monthly s ta te m e nt you ge t from an o r d i n a r y bank. 19 93 Q. Yes, I un d e rs ta n d . Because, the Moving on the n, Mr. McCarthy, 20 you mention in your s ta t e m e n t, a t pa ra grap h 9 - ­ 21 t h a t i s page 4 of your sta te m e nt? 22 A. 23 94 Q. 24 A. 25 95 Q. 26 27 28 29 Yes. Have you got t h a t t h e r e ? Yes. In r e l a t i o n to Channel I s l a n d Tr us t & Company, t h a t you never a v a i l e d of any of th e s e r v i c e s d e s c r ib e d : "I have never had d e a l i n g s with Guinness & Mahon J e r s e y Limited, Guinness & Mahon, Channel I s l a n d s Limited or College T r u s t e e s . " 1 2 3 9 6 Q. 4 Now, can I show you a document (SAME HANDED TO MR. McCarthy) (Ex hib it 1). 5 A. 6 97 Q. Thank you very much. This i s an i n t e r n a l memorandum of Guinness & Mahon, 7 from Mr. Traynor to POD, who we un d e rs ta n d to be Pat 8 O'Dwyer of th e Loans Department i n Guinness & Mahon, 9 and he i s saying: "Could you p l e a s e arra nge to send a cheque f o r £3,500, with th e fol lo wi ng l e t t e r from y o u r s e l f , to Mr. P.L.O. Kinder, Deputy Manager, U l s t e r Bank Limited, College Green, Dublin 2. The amount should be d e b i t e d to GMCI . . . " 10 11 12 13 14 Which s ta nd s f o r Guinness Mahon Channel I s l a n d s . 15 " . . . E5 a c c o u n t ." 16 17 Then he appends th e l e t t e r t h a t i s t o go with t h a t 18 and th e l e t t e r says: "Dear S i r , At th e r e q u e s t of Mr. J . S . McCarthy we have p l e a s u r e in a t t a c h i n g h e r e t o a d r a f t pa yable to him f o r £3,500, and would be g r a t e f u l i f you would lodge i t t o h i s account and a d v is e him of the p o s i t i o n . Yours, e t c , J .D .T ." 19 20 21 22 23 24 Which i s Mr. Traynor. 25 Would you l i k e a couple of minutes t o d i s c u s s t h i s ? 26 A. 27 28 29 Now, t h a t i s 19th A p r il 1977. I d o n ' t r e a l l y need a few minutes because, q u i t e h o n e s t l y , I a b s o l u t e l y h a v e n ' t a cl ue what i t means. 98 Q. You h a v e n ' t ...(INTERJECTION). 1 s u r p r i s e d I never got a cheque from - - I do not know 2 whether i t would have been . . . (INTERJECTION). 3 99 Q 4 Have you any r e c o l l e c t i o n of t h i s cheque being lodged to your account with th e U l s t e r Bank? 5 A 6 100 Q 7 A 8 101 Q 9 I h a v e n ' t th e s l i g h t e s t . You h a v e n ' t ? No. Now, does th e r e f e r e n c e to Guinness Mahon Channel I s l a n d s ...(INTERJECTION). 10 A 11 102 Q Can I keep t h a t ? Yes, you may. Does th e r e f e r e n c e t o Guinness Mahon Channel I s l a n d s E5 account mean any th in g t o you? 12 13 A 14 103 Q 15 A No, n ot hin g a t a l l . I t doesn't? No. Unless I have had an e x t r a o r d i n a r y l a p s e of 16 memory, I never remember having any th in g t o do with 17 t h a t , what di d you c a l l i t Guinness & Mahon - - no, 18 f i r s t of a l l , 19 College T r u s t e e s . 20 want t o be saying I d i d n ' t , but my s i g n a t u r e i s n ' t 21 down anywhere, i s i t ? 22 104 Q I know I have n o th in g t o do with Or, i f I d id - - you see, I d o n ' t No, your s i g n a t u r e i s not on i t , but on th e face of 23 t h i s , what i t appears to mean i s t h a t £3,500 was 24 withdrawn from th e account of Guinness Mahon Channel 25 I s l a n d s E5, which i s a coded account, and a d r a f t in 26 th e amount p a i d i n t o your account i n U l s t e r Bank. 27 So t h a t f o r some reason money came i n t o your account 28 in U l s t e r Bank from th e Guinness Mahon Channel 29 I s l a n d s account. You cannot remember what t h a t was 1 2 No, I h a v e n ' t th e s l i g h t e s t memory of i t a t a l l , but 3 I would have to say t h a t I would only assume t h a t 4 maybe Mr. O'Dwyer or somebody made a mis ta ke. 5 Now, can I ask you about a d i f f e r e n t m a t t e r , 6 Mr. McCarthy, about a company c a l l e d Beryl 7 Investments? 8 Investments? 9 A That i s th e l i t t l e p r o p e r t y company I t o l d you about. 10 11 You are f a m i l i a r with Beryl 106 Q That i s th e p r o p e r t y company in which you were a s h a r e h o ld e r? 12 13 A 14 107 Q That's rig h t. Did t h a t company, i n s o f a r as you can remember, 15 r e c e i v e fi n a n c e in the e a r l y 70' s from Guinness & 16 Mahon? 17 A 18 Well, Guinness & Mahon put up the money f o r us to buy i t . 19 108 Q 20 A 21 For you to buy? To buy th e p r o p e r t y , Beryl. That i s th e same one I t o l d you about . . . (INTERJECTION). 22 109 Q 23 A 24 110 Q 25 A 26 111 Q 27 A For th e Bride S t r e e t p r o p e r ty ? Yes . Oh, i s i t t h a t one? Well, Beryl was a kind of a name we j u s t c a l l e d i t . What s e c u r i t y was given f o r t h a t fina nc e? The s e c u r i t y would have been th e p r o p e r t y i t s e l f , 28 pl u s a r e n t a l income f o r th o s e garages and t h i n g s I 29 t o l d you were r e n t e d from th e p r o p e r t y . That again 1 MR. JUSTICE COSTELLO: 2 3 Mr. McCarthy, we thought we might ta k e a c o ff e e 4 break now, f o r about te n minutes or so. 5 Okay. 6 7 SHORT ADJOURNMENT 8 9 MR. JUSTICE COSTELLO: something, Mr. McCarthy? 10 11 Did you want t o say A I j u s t wondered was t h e r e any way t h a t t h a t l e t t e r 12 would have any th in g to do with t h a t Beryl t h in g ? 13 That i s th e only o t h e r s o r t of l o o s e - e n d I can t h i n k 14 of 15 112 Q . MS. MACKEY: 16 17 What might i t have had to do with Beryl? A Having s a i d t h a t , I j u s t do not know. You see, the 18 i n t e r e s t from th e Beryl r e n t of th e garage and 19 th i n g s went towards the r e n t of th e money. 20 words, i t went towards th e i n t e r e s t payments. 21 r e n t , I should have s a i d , went towards paying the 22 i n t e r e s t on th e o r i g i n a l loa n. 23 113 Q 24 A In o t h e r The Right. So, I am wondering would i t have any th in g t o do with 25 that. 26 you, I j u s t have to say t h a t I j u s t do not know. 27 MS. MACKEY: 28 29 Having s a i d t h a t the n, I j u s t c o u l d n ' t t e l l Very good. Thank you. 1 2 3 MR. ROWAN: Mr. McCarthy, you have 4 e x p la i n e d t o us t h a t , 5 t o g e t h e r with o t h e r s , you i n v e s t e d i n some p r o p e r t y 6 t r a n s a c t i o n s and you a l s o i n v e s t e d a t a d i f f e r e n t 7 time i n some s h a r e s of A t l a n t i c Resources? 8 A 9 115 Q Yes, r i g h t . The o t h e r s on each oc casion, t h e r e were some names 10 in common, but t h e r e were some who were not 11 n e c e s s a r i l y inv olv ed in both t r a n s a c t i o n . 12 wondered whether, s in ce c e r t a i n l y th e A t l a n t i c 13 Resources investment was f a i r l y s u b s t a n t i a l money in 14 th o s e days ...(INTERJECTION). 15 A 16 116 Q I That i s r i g h t . Whether you a c te d e n t i r e l y on your own i n i t i a t i v e or 17 whether, f o r i n s t a n c e , you sought some guidance from 18 a d v i s o r s on th e A t l a n t i c Resources t r a n s a c t i o n ? 19 The only people I d e a l t with, n e e d le s s t o say, were 20 th e two people I d e a l t w ith. 21 f o r o u t s i d e a dvice . 22 th e A t l a n t i c Resources t h i n g , e v e r y t h i n g t h a t 23 happened in A t l a n t i c Resources - - and I am not being 24 f a c e t i o u s when I say t h i s - - you would re a d in the 25 paper every day. 26 in vo lv e d in a d r i l l i n g programme and l i k e every 27 redneck on th e r i g you knew what was happening; you 28 d r i l l through c e r t a i n sands - - I remembered a l l the 29 term ino log y then and I f o r g e t i t now - - th e n you get We d i d n ' t a c t u a l l y ask Because, i f I could say, about In a way, i t was simple, you were 1 t o th e f i n a l 50 f e e t or 100 f e e t and l i t e r a l l y then 2 t h a t i s where your g e o l o g i s t and people l i k e t h a t 3 say th e y t h i n k t h e r e would be commercial q u a n t i t i e s 4 of o i l . 5 out a f t e r t h a t . 6 117 Q 7 8 The r i s k was t h a t t h e r e would be n o th in g t h e r e or t h a t t h e r e would be b la c k gold found? A 9 Well, t h a t i s r i g h t . But, as I s a i d t o you e a r l i e r on, an awful l o t depended as well on s t e p - u p s to d e l i n e a t e th e s i z e of th e f i e l d . 10 11 The f i r s t s t r i k e , th e y never got anything 118 Q I f I u n de rs ta nd you c o r r e c t , you i n v e s t e d a very 12 s u b s t a n t i a l sum of money and you c o nt in ue d to i n v e s t 13 over a pe rio d? 14 A 15 119 Q Yes . E n t i r e l y in th e hope t h a t t h e r e would be o i l found 16 and of course then t h e r e would be a s u b s t a n t i a l 17 growth in th e value of your inv e st m en t. 18 th e nub of i t ? 19 A I know lookin g back i t sounds very s t u p i d , but t h a t was i t . 20 21 Yes. That was 120 Q I am j u s t s l i g h t l y in c r e d u lo u s of th e id e a t h a t you 22 might have done t h i s merely by r e a d in g th e paper? 23 No, i t r e a l l y w a s n ' t t h a t way. 24 t h a t as s o r t of an e x p l a n a t i o n , t h a t s o r t of 25 everyone in I r e l a n d knew what was going on in 26 A t l a n t i c Resources. 27 make a f i n d - - in the A t l a n t i c Resources s i t u a t i o n 28 th e o p e r a t o r was th e Gulf Oil Company and they 29 r e a l l y are th e main i n fo r m a t io n g i v e r s . I am only making All I can say i s t h a t i f you They look 1 a t i t and th e y say, 2 t h a t and th e o t h e r t h i n g , ' and "This looks very 3 prom ising.' 4 h i g h l y e n t h u s i a s t i c themselves about what was going 5 t o happen. 6 regime was put in , which was as high as any o i l 7 producing c ountry in th e world, and a l l t h e s e people 8 l i t e r a l l y j u s t di s a p p e a re d . 9 e v e r y th in g and s a i d , 10 121 Q. Before th e y scampered o f f t h e y were Then, as you pro ba bl y know, th e ta x Gulf Oil dropped 'We a re not d r i l l i n g any more.' . So th e t a x regime was l i k e l y to make an investment of t h a t s o r t e i t h e r l e s s a t t r a c t i v e or u n a t t r a c t i v e ? 11 12 'Well, I t h i n k we w i l l do t h i s , A. Yes, t o th e o p e r a t o r s / m a j o r companies, and Gulf were 13 a major company. 14 i f th e t a x regime was wrong. 15 very wrong f o r a cou ntry t h a t had never a c t u a l l y 16 produced a p i n t of o i l to put in a t a x regime saying 17 i n case we do produce a p i n t of o i l , our t a x regime 18 i s going to be worse than th e North Sea. 19 l i t e r a l l y what th e y s a i d . 20 where th e Gulf Oil Company were e n t h u s i a s t i c and 21 e v e r y th in g e l s e - - we were a l l e n t h u s i a s t i c because 22 we would a u t o m a t i c a l l y say, w e ll, look, i f th e y say 23 i t i s good to keep d r i l l i n g - - now I w ould n't do i t , 24 I need h a r d l y t e l l you, with h i n d s i g h t - - you would 25 a u t o m a t i c a l l y s o r t of say we have got t o be t h e r e , 26 t h e s e are th e b e s t people in th e world. 27 would be th e re aso n. 28 t h i n g , lookin g back on i t . 29 122 Q. I t would make i t very u n a t t r a c t i v e They c o n s id e re d i t was That i s Having s a i d a l l t h a t , So t h a t The money was an enormous Making th e s o r t of investment t h a t you did, 1 su bs e q u e n tl y we saw t h a t t h a t l e d t o c o n s i d e r a b l e 2 f i n a n c i a l embarrassment f o r you? 3 Absolutely. 4 123 Q Did t h a t p o s s i b i l i t y of f i n a n c i a l embarrassment 5 s t r i k e you a t th e time you were making the 6 inve stment ? 7 A I t might sound a s t u p i d t h i n g to say, but of course 8 you had an ide a in the back of your mind, but when 9 you ge t th e f e v e r , i f I could use t h a t word, f o r 10 some reason or o t h e r you j u s t d o n ' t even t h i n k of 11 it. 12 r i g h t t h a t you j u s t keep on dig gin g y o u r s e l f i n t o a 13 b i g g e r ho le . 14 where you l i t e r a l l y cannot pay your d eb ts to 15 Guinness & Mahon and you a re i n c l i n e d t o s o r t of do 16 any th in g to keep i t going, s t u p i d though i t may 17 sound. 18 l o s i n g s u b s t a n t i a l money in Lloyds and, as I say, I 19 was l o s i n g s u b s t a n t i a l money in D o c k r e l ls . 20 sure you w ou ld n' t i n v e s t in me. 21 124 Q 22 A 23 24 You are so convinced t h a t i t i s going to be Also, you know, you are i n a s i t u a t i o n I might add t h a t a t th e same time I was So, I am Troubled times? Extremely t r o u b l e d times, t e n ye ars of a p p a l l i n g d i s a s t e r f o r me, p e r s o n a l l y . 125 Q I f I u n de rs ta nd you c o r r e c t l y , you say t h a t you did 25 t h e s e t h i n g s witho ut c o n s u l t i n g an inve stment b ro ke r 26 or a cc ounta nt or a s o l i c i t o r , or any p r o f e s s i o n a l 27 perso n who might have, s h a l l we say, r e e l e d you in a 28 little? 29 Well, i n f a c t , i t i s i n t e r e s t i n g when I say t h i s - ­ 35 1 obvi ous ly, I am su re as an a cc ou nt a n t you would have 2 been ab le to un de rsta nd th e Medford and th e n the 3 Ascot t h i n g which was s t a r t e d to s o r t of save the 4 d i f f e r e n t - - th e Medford in my case and th e o t h e r 5 two companies, or the o t h e r two companies, I suppose 6 t h a t were s e t up f o r th e o t h e r two peo ple . 7 Obviously, Guinness & Mahon a l s o had th e f e v e r or 8 e l s e th e y would have s a i d , 9 That was t r u l y th e way i t was. 'Look, enough i s enough.' Now you say 'How in 10 th e name of God di d I do i t ? ' 11 a t th e back of your mind you s a i d , 12 work out and i t i s going to he lp me with a l l my 13 o t h e r s o r t of p r o b le m s .' 14 126 Q 15 16 A 127 Q A Guinness & Mahon came out of i t a l l r i g h t a t the Guinness & Mahon got t h e i r money back, but th e y must But a t th e beg innin g th e y d i d n ' t know t h e y were Well, I presume l i k e th e y a re in th e r i s k b u s i n e s s , th e merchant bank. 128 Q 23 24 . going t o be a b le to get t h e i r money back? 21 22 'T h is i s going to have ...(INTERJECTION). 19 20 Maybe end, d i d n ' t they? 17 18 but you d id . Yes, but i t was, or am I c o r r e c t , i t was unsecured le n d in g a t th e beginning? A They had my p e r s o n a l gua ra nt ee and of course they 25 had th e s h a r e s th e n. 26 th e y must have thought my p e r s o n a l g u a ra n te e , a t the 27 end of th e day, i t would be down t o s e l l i n g the 28 house and t h a t kind of s t u f f . 29 But, as time pass ed , between th e time t h a t you 36 That i s what t h e y had. Maybe 1 a c q u ir e d th e loan f i r s t and by the time (in au di bl e) 2 - - f o r g i v e me i f I am not us in g th e c o r r e c t term 3 r e p a i d th e b a la nc e of th e loan in 1997, somewhere in 4 th e middle of a l l of t h a t th e O ' R e i l l y family gave a 5 security? 6 In 1990, I t h i n k . 7 130 Q -­ You have s a i d t h a t your s e c u r i t y r e a l l y would not 8 have been s u f f i c i e n t to have r e p a i d th e loan had the 9 s e c u r i t y been c a l l e d ; i s t h a t r i g h t ? 10 A Yes. I presume i f I had s o r t of s old , as I say, my 11 house and e v e r y t h i n g e l s e , I suppose i t would have 12 been. 13 131 Q 14 A 15 132 Q 16 17 Eve rything on th e l i n e ? Eve rything was on the l i n e . Then, around t h a t time, in 1991 or t h e r e a b o u t s , Mr. O ' R e i l l y came in with a s e c u r i t y ? A With a g u a ra n te e , yes, and in f a c t , as I have shown 18 t h e r e , took over th e paying of my i n t e r e s t on the 19 loan. 20 133 Q So t h a t a t t h a t p o i n t , of cou rse, an unsecured loan 21 became a s ec ure d - - w e ll, not a s ec ure d loan, i t 22 became a loan s u b j e c t to a g u a ra n te e , where i t was 23 very l i k e l y t h a t th e i n d i v i d u a l g iv in g th e gu aran tee 24 had th e r e s o u r c e s to meet i t i f n e ces sar y? 25 A They were a c t u a l l y i n a good p o s i t i o n th e n. 26 27 134 Q 28 A 29 T h a t ' s r i g h t , yes. How d id th e y manage t o achiev e t h a t p o s i t i o n ? Once th e y got th e O ' R e i l l y gu a ra nt ee f o r £750,000, th e y had i t then, r e a l l y . 1 135 Q. Yes, th e q u e s t i o n I suppose i s a narrower q u e s ti o n : 2 What prompted Mr. O ' R e i l l y to give th e gu a ra nt ee a t 3 t h a t st age ? 4 A. What prompted him was, l i t e r a l l y , t h a t I, myself, 5 was i n deep f i n a n c i a l t r o u b l e and t h e y w ouldn 't 6 a cc e pt my gu a ra nt ee anymore. 7 t o my f r i e n d and say t h i s i s th e p o s i t i o n . 8 I have got to say t h a t i f I had s a i d , 9 me the £750,000," he would have given me the So, I th e n had to go I mean, "Will you give 10 £750,000. 11 have happened. 12 got him on board were in good shape, but i t did not 13 change t h e i r view on me p e r s o n a l l y . 14 136 Q. 15 16 Strange though i t may seem, but i t would So, l i k e Guinness & Mahon, once they A t l a n t i c Resources tu r n e d out to be a g r e a t dis app oi ntm ent to you? A. Well, i t did, because what was happening the n, we 17 had the Gulf War coming on, i f you remember, the 18 p r i c e of o i l was going down, d r a m a t i c a l l y going 19 down, and th e i n t e r e s t r a t e s on your loan were going 20 up. 21 137 Q. But had i t been oth erw is e i t might have been a very i n t e r e s t i n g investment? 22 23 I t was th e o r i g i n a l Catch-22 s i t u a t i o n . A. Indeed, i t would, and t h a t i s what we were hoping i t 24 would be. 25 as simple as t h a t . 26 138 Q. I t was a c t u a l l y a t o t a l d i s a s t e r . I t is As you q u i t e r i g h t l y say, I suppose i t was Guinness 27 & Mahon's r o l e to lend money, not n e c e s s a r i l y to 28 de cide f o r themselves whether the inve stment was a 29 good one, because th e y were allow in g you t o make the 1 judgment on th e r i s k . 2 your judgment? 3 A. So th e y l e n t you money on Yes, I suppose you could put i t t h a t way, th e y did. 4 They had e x p er ie n c e of me and Tony O ' R e i l l y in the 5 Tara t h i n g , where th e y o b vi ou s ly made a l o t of money 6 on t h e i r investment and on t h e i r a c t u a l banking of 7 the lo a n. 8 doing i t , 9 139 Q. you know, t h a t i t was good. I t h i n k you s a i d to us t h a t Mr. Traynor de cided how th e whole loan s i t u a t i o n would be s t r u c t u r e d ? 10 11 A. 12 140 Q. 13 That i s r i g h t . And he de cided th e s o r t of v e h i c l e t h a t would be used and so on? 14 A. 15 141 Q. 16 17 So, th e y prob ab ly thought t h a t i f we were Yes, yes. Do you b e l i e v e t h a t s t r u c t u r e was put i n p la c e with some end o b j e c t i v e in mind? A. Well, th e only t h i n g I can t h i n k of now, again with 18 h i n d s i g h t , was t h a t i t gave him, or them f u l l 19 c o n t r o l over th e s h a r e s . 20 i t was done t h a t way. 21 142 Q. I am assuming t h a t i s why Of course, a t th e time a l l of t h a t was c r e a t e d 22 everyone had a view t h a t t h e r e was going t o be a 23 very p r o f i t a b l e investment t h e r e ? 24 A. 25 143 Q. 26 A. 27 144 Q. 28 A. 29 That i s r i g h t . Might t h a t have in f l u e n c e d th e s t r u c t u r e ? I am assuming t h a t i t pro ba bl y did. In what way? Well, I t h i n k maybe they were p r o t e c t i n g themselves a g a i n s t people l i k e myself who were n o n - s e l l e r s , 1 which was th e re aso n. 2 be a time when we want to s e l l t h e s e s h ar es and 3 maybe t h e s e guys w i l l come along with a s t o r y and 4 say, look, no, i t i s going to be b e t t e r , t h i s i s 5 going t o be a 100 m i l l i o n b a r r e l f i e l d , i t i s going 6 t o be a 200 m i l l i o n b a r r e l f i e l d . ' 7 assume t h a t th e y wanted to have power so th e y could 8 say, 9 had a good run on t h i s and we are s e l l i n g down the Maybe th e y s a i d , 'Enough i s enough. 'There w i l l So, I can only We a re ba nk er s. We have 10 shares.' 11 a m a t t e r of f a c t , I t h i n k t h a t must be th e reaso n. 12 145 Q. That i s the only t h i n g I can t h i n k of . As Would I be r i g h t in b e l i e v i n g t h a t i t was pro bably 13 not n e c e s s a r y to s e t up a l l of t h e s e nominee and 14 i n t e r m e d i a r y arrangements between you as the 15 t h e o r e t i c a l b e n e f i c i a l owner and th e a c t u a l company, 16 A t l a n t i c Resources, t h a t t h a t could have been done 17 w i t h i n I r e l a n d and i t was not s t r i c t l y n e c e s s a r y to 18 do i t via th e o f f - s h o r e v e h i c l e . 19 were doing was d i s t a n c i n g th e b e n e f i c i a l owner from 20 th e share r e g i s t e r , i f you l i k e , so i t w a s n ' t then 21 e v id e n t who a c t u a l l y owned th e s ha re s? 22 A. Because, a l l they Well, yes, I would say i t pro ba bl y - - ag ain with 23 h i n d s i g h t , i t was s o r t of to say, 24 i s , t h e r e i s th e money.' 25 t h e r e where th e Dublin bank might have s a i d , 26 we can only allow so much,' and we wanted more 27 money. 28 said, 29 main reason was to give him power over buying and 'Well, t h e r e i t Maybe t h e y had a s i t u a t i o n 'Look, Maybe t h a t was one of the re aso ns t h a t he ' I w i l l do i t t h i s w a y . ' But, I t h i n k the 1 selling. 2 a dvis e d by my a cc ou nt a n t. 3 146 Q. That i s the view I have now, having been Causing a s a l e to be made i f someone judged t h a t the 4 sh ar es had rea ched a p a r t i c u l a r p r i c e i n th e market 5 and i t was a j u d i c i o u s time to s e l l them? 6 A. You see, th o s e sh ar es a t t h a t time, Mr. Rowan, t h e r e 7 was a f l u c t u a t i o n of th e s h a r e s were kind of 8 enormous. 9 50p, back up to a pound. I t used go from s o r t of a pound down to Huge jumps. Those kind of 10 sh ar es are not l i k e the normal climb and th e normal 11 d e c l i n e of, say, a banking s h a r e . 12 is. 13 o t h e r sh ar e, because you a c t u a l l y h a v e n ' t got 14 any th in g. 15 could say, on a chance t h a t you w i l l ge t something, 16 t h a t the r e p o r t s are good and the rea son s are good 17 and the sands are r i g h t and th e (i n a u d ib le ) and a l l 18 tho se big long words which I knew th e n but I d o n ' t 19 know now, t h a t th e y were a l l r i g h t . 20 147 Q. That i s what i t An e x p l o r a t i o n share i s so d i f f e r e n t than any You a re i n v e s t i n g your money, r e a l l y , you Had th e sh ar es been r e a l i s e d a t a p r o f i t , of course, 21 t h e r e was then an advantage to having an o f f - s h o r e 22 company? 23 A. I f you are r e f e r r i n g to t a x or t h a t s o r t of t h i n g , 24 of course t h e r e would be, but could I j u s t say t h i s 25 much to you; th e l e a s t worry I had i n th e whole 26 world then was ta x , because I had so many t a x l o s s e s 27 c a r r i e d forward, from Lloyds, from D o c k re l ls , from 28 t h a t l i t t l e company t h e r e and from a n o th er company 29 c a l l e d IEC - - i n c i d e n t a l l y , I m is le d you a l i t t l e 1 b i t t h e r e , Ms. Mackey. 2 company t h e r e c a l l e d IEC. 3 MS. MACKEY: What i s t h a t ? 4 That Des Traynor was i n . I fo r g o t t o say t h a t to 5 you. 6 i t c e r t a i n l y w ould n't have m a t t e r e d t o me whether i t 7 was o f f - s h o r e or on -s ho re . 8 148 Q There was a n o th er l i t t l e I had so many ta x l o s s e s c a r r i e d forward t h a t MR. ROWAN: You w i l l f o r g i v e me i f I 9 find i t a l i t t l e d i f f i c u l t 10 to u n de rs ta nd why you would have gone i n t o a 11 s p e c u l a t i v e investment with th e id e a o t h e r than you 12 were going to make a p r o f i t out of i t ? 13 A 14 149 Q That's rig h t. Eq ually, of cou rse, l o s s e s t h a t you had, t h e r e may 15 well have been r e s t r i c t i o n s on the use of them 16 against future gains. 17 you went i n t o A t l a n t i c because you b e l i e v e d i t was 18 going to be a s u c c e s s f u l investment? 19 A 20 150 Q The i s s u e , r e a l l y , i s t h a t Yes . Had i t been a s u c c e s s f u l in ve st me nt, i t was u s e f u l 21 t h a t i t would have been handled through Cayman 22 Trust. 23 A I have got to say t h a t f o r me - - I know I am 24 r e p e a t i n g myself ag ain - - i t r e a l l y would not have 25 m a tt e re d . 26 what do you mean? 27 What I mean i s t h a t i t would have been a gain which 28 would have been enjoyed by a company o f f - s h o r e and 29 t h a t might have p r e s e n t e d t a x o p p o r t u n i t i e s ? When you say i t would have been u s e f u l , 1 Yes. 2 me one way or th e o t h e r because any th in g c a p i t a l , 3 even r i g h t up to t h i s very day - - I mean, I have ta x 4 l o s s e s c a r r i e d forward of p r e t t y s u b s t a n t i a l sums. 5 I t w ou ld n 't have r e a l l y m a t t e r e d t o me one way or 6 the o t h e r . 7 investment i n t o D oc kre ll s, which was a couple of 8 hundred thousand pounds, and more a f t e r t h a t . 9 l o s t s u b s t a n t i a l money in Lloyds, which happened Well, c e r t a i n l y , i t would not have m a tt e r e d to I had a l r e a d y t o t a l l y l o s t my f i r s t I had 10 when Lloyds went i n t o l o s s e s , which you are pro ba bly 11 aware, around th e e a r l y 80 ' s . 12 ta x r e a l l y d i d n ' t even e n t e r my mind. 13 MR. ROWAN: So, th e q u e s t i o n of Thank you very much. 14 END OF EXAMINATION OF MR. MCCARTHY BY MR. ROWAN 15 16 17 mr. 18 MR. JUSTICE COSTELLO McCarthy was examined, as follows, by 19 20 152 Q MR. JUSTICE COSTELLO: I have a few q u e s t i o n s to ask you, Mr. McCarthy. 21 22 The f i r s t i s about the documents you have given us? 23 A 24 153 Q Yes . They seem to be incomplete, Mr. McCarthy. Have you 25 any o t h e r s ? 26 I have no o t h e r documents. 27 say to you, Judge C o s t e l l o , were - - I have changed 28 my o f f i c e fo ur tim e s . 29 bu s i n e s s now, but up to t h a t time I had changed my These documents, may I As I say, I am r e t i r e d from 1 o f f i c e fo ur tim es , i n c l u d i n g t o t a l l y l o s i n g every 2 document I had in the Dockrell f i r e i n Georges 3 Street. 4 . . . (INTERJECTION). 5 154 Q. Then I went out to Ballymun I f I can st o p you, Mr. McCarthy. Are t h e y th e only documents you have? 6 7 A. 8 155 Q. 9 A. 10 156 Q. 11 A. 12 157 Q. 13 These ones t h a t I have given you? Yes. They are th e only documents. You have no o t h e r s ? None a t a l l . Did you ever have an a cc ounta nt a d v i s i n g you a t any time i n r e l a t i o n to t h e s e m a t t e r s ? 14 A. 15 158 Q. 16 A. 17 159 Q. Oh, yes, Noel Corcoran. Mr. Corcoran? I t h i n k i t i s t h e r e i n th e . . . (INTERJECTION). Have you a s c e r t a i n e d from Mr. Corcoran whether he 18 has any documents r e l e v a n t to the purchase of t h e s e 19 sh ar es and th e e s t a b l i s h m e n t of t h e s e companies 20 off-shore? 21 A. 22 23 These documents are what he got from me and from Mo riar ty. 160 Q. 24 25 I know he h a s n ' t . The documents t h a t you have given us, t h e s e were a t your home, were they? A. No, some of them were in my f i l e t h a t I had i n s i d e 26 i n my old o f f i c e , where I s t i l l l e f t a few f i l i n g 27 c a b i n e t s , and th e r e s t of them were got from a 28 basement, which I thought had been d e s tr o y e d , but I 29 had t o re-employ my s e c r e t a r y f o r two weeks to go 1 down and go through a l l of t h o s e , and t h a t i s what 2 we came up with. 3 161 Q 4 A So, t h e r e a re o t h e r documents down t h e r e ? There are not any more documents down t h e r e , because 5 i t has been sear ch ed from top to bottom, but I am 6 sure t h e r e were more documents. 7 162 Q 8 A 9 163 Q 10 A 11 164 Q 12 A Sorry, you s a i d you s en t your s e c r e t a r y down t h e r e ? And myself. And y o u r s e l f ? Yes . Where t h e r e a l o t of documents down t h e r e ? There were a l l kinds of documents down t h e r e . 13 documents were in boxes t h a t I had 14 t h i s and t h a t , you know, t h e s e o r d i n a r y s o r t of 15 files . 16 165 Q 17 A 19 166 Q 20 A You took out from the documents i n th e basement the No, e v e r y th in g to do with t h a t I took out. Eve rything to do with what? Eve rything to do with A t l a n t i c Resources . . . (INTERJECTION). 21 22 167 Q 23 A 24 168 Q 25 A Where th e y in a box c a l l e d " A t l a n t i c Resources"? No, no. How were th e y . . . (INTERJECTION). They were jumbled up with a whole l o t of o t h e r 26 documents. 27 extremely lucky to have them. 29 on "bank" and ones you thought were r e l e v a n t ? 18 28 Those 169 Q You must remember, Judge C o s t e l l o , I was Other documents which had n o th in g t o do with your d e a l i n g s with Ansbacher; i s t h a t i t ? 1 2 170 Q A ll r i g h t , Guinness & Mahon. Were t h e y jumbled up 3 with o t h e r documents t h a t had n o th in g t o do with 4 Guinness & Mahon? 5 A banks. 6 7 They were jumbled up with o t h e r documents from o t h e r 171 Q Very w e l l . Now, I want to ask you t h i s about your 8 statement. You say i n pa ragra ph 2 of your sta te m e n t 9 th at: "These d e a l i n g s a ros e from loans made by th e company to me f o r th e purpose of inv est me nt s by me in c e r t a i n s h a r e s . " 10 11 12 13 Is t h a t c o r r e c t ? 14 A 15 172 Q 16 A 17 173 Q What page are you on? Page 1, p a ra graph 2, th e t h i r d s en te n c e. Yes . "These d e a l i n g s a ros e from loans made by th e company to me f o r th e purpose of inv est me nt s by me in c e r t a i n s h a r e s . " 18 19 Is t h a t c o r r e c t ? 20 21 A 22 174 Q 23 A 24 175 Q 25 Yes . The loans were, in f a c t , made to you, were they? I am assuming th e y were made to me. The v e h i c l e t h a t was used was t h i s o f f - s h o r e company e s t a b l i s h e d by Ansbacher in Cayman? 26 A 27 176 Q Yes. Medford, as f a r as I was concerned, Medford. You reg a rd ed y o u r s e l f as th e owner of th e s har es 28 which were pur chased with th e money which was 29 loaned? 1 2 177 Q 3 A Well, now, c e r t a i n l y not in mine. I was always 4 under th e imp re ssi on th e y were r e g i s t e r e d i n a 5 company c a l l e d Medford. 6 r e g i s t e r e d in t h a t company e i t h e r . 7 178 Q Seemingly, t h e y were not We know from th e documents t h a t some of th e s ha r es 8 i n Ascot were r e g i s t e r e d in th e name of Overseas 9 Nominees ? 10 A 11 179 Q 12 A 13 180 Q 14 Yes . Were t h e s e s h a r e s r e g i s t e r e d in . . . (INTERJECTION). I d o n ' t know, Judge. Did you not check to see in whose name th e s har es were r e g i s t e r e d in the s har e r e g i s t e r ? 15 A 16 181 Q 17 A 18 182 Q 19 A 20 183 Q 21 You mean l a t e l y ? No, no, a t th e time. No, I d id not. You assumed th e y were your s ha re s? Yes, I j u s t assumed i t . The o r i g i n a l loan was so t h a t you could own s har es i n A t l a n t i c Resources; i s n ' t t h a t c o r r e c t ? 22 A 23 184 Q 24 Yes . Then t h i s was supplemented by a second loan to buy f u r t h e r sh ar es ? 25 A 26 185 Q 27 That i s c o r r e c t . Then t h e s e were amalgamated on 5th A p r i l 1986, the two loans? 28 A 29 186 Q Yes, t h a t i s c o r r e c t . Medford then had borrowed t h e s e monies i n o rd e r to 1 a s s i s t you, en able you to have a l l th e s ha r es which 2 were i n th e name of e i t h e r Medford or some o t h e r 3 company. 4 Yes . 5 187 Q Is t h a t the p o s i t i o n ? You reg a rd ed y o u r s e l f as b e n e f i c i a l owner of t h e s e sh ar es ? 6 7 A 8 188 Q 9 A 10 189 Q I di d. I want you to t u r n your mind now t o Ascot Holdings? Yes . You have not found any document which evidences the 11 c o n t r a c t with Ascot Holdings, i s t h a t c o r r e c t , 12 n o th in g a t a l l ? 13 A I d o n ' t t h i n k t h e r e was a document t h a t I was given. 14 Anyway, th e answer to your q u e s t i o n i s , no, I have 15 not. 16 190 Q 17 Do you know when th e loan was made i n r e l a t i o n to Ascot Holdings? 18 A 19 191 Q I t h i n k th e d a te i s here somewhere. We have a l e t t e r of 31st December 1986, from 20 Guinness Mahon Cayman to Mr. Traynor, which t a l k s 21 about the purchase of s h a r e s , but i t d o e s n ' t - - t h i s 22 i s the f i r s t l e t t e r t h a t you have given us about the 23 loa n t o Ascot (Ex hib it 11)? 24 A 25 192 Q 26 27 Do you know when th e loan took p la ce ? I t was obv io us ly b e f o r e December 1986. A 31st December 1986, and i t shows t h e y were purchased . . . (INTERJECTION). 28 29 Yes . 193 Q 1 Mr. McCarthy, do you remember when th e loan was 2 made ? 3 A. 4 5 I can only assume i t must have been around t h a t dat e . 194 Q. I see. Well, now, t h i s Ascot Holdings seemed to have owned s h a r e s in F i t z w i l t o n ? 6 7 A. 8 195 Q. 9 A. 10 196 Q. 11 A. 12 197 Q. 13 A. 14 198 Q. Yes. Were you a D i r e c t o r of F i t z w i l t o n ? I was. Was i t a p u b l i c company, F i t z w i l t o n ? I t was. A t l a n t i c Resources, was i t a p u b l i c company? Yes. Over th e page t h e r e , th e p h o t o s t a t i s very bad, but 15 i t s t a t e s " p r e s e n t l y hold 760,000 s har es in 16 Fitzw ilton"? 17 A. 18 199 Q. Yes. Do you know how Ascot Holdings Limited obta in e d 19 760.000 s h a r e s in F i t z w i l t o n ? 20 i t a c q u ir e d them from th e Cayman S e c u r i t i e s and 21 445.000 through Shaw & Company. 22 A. 23 200 Q. I t says, i n b r a c k e t s , Yes. Was t h e r e money borrowed by you and us in g Ascot 24 Holdings Limited as a v e h i c l e f o r th e purchase of 25 F i t z w i l t o n sh ar es ? 26 A. Yes. Ascot Holdings was s e t up, ob vio usl y, by 27 Traynor because th e o t h e r loans he had were going 28 badly. 29 201 Q. No, I u n de rs ta nd t h a t . What I am t r y i n g t o i n q u i r e 1 i s whether or not, in accordance with th e sta te m e nt 2 you made a t th e very begi nni ng, t h a t you o bt a in e d 3 th e s e loans f o r th e purpose of invest men t, di d you 4 o b t a i n f u r t h e r loans and use Ascot Holdings with the 5 purpose to buy sh ar es in F i t z w i l t o n ? 6 Yes . 7 202 Q They were again in the name of t h i s company Ascot, but you r e ga rd ed them as your own? 8 9 A 10 203 Q Yes, I assumed th e y were my s h a r e s , yes. This was a n o th e r t r a n s a c t i o n t h a t you undertook with 11 Guinness & Mahon Cayman Tr u st - - t h e y s e t up a n o th er 12 company, th e y lend money to t h a t o t h e r company, the 13 o t h e r company bought sh ar es and i t seems as i f they 14 had 760,000, which was in t h e i r name and r e g i s t e r e d 15 in the name of Overseas Investment, but you reg a rd ed 16 as your s h a r e s ; i s t h a t i t ? 17 A 18 I owned a t h i r d of e v e r y th in g th e y bought. 19 204 Q 20 A 21 22 Yes, I assumed th e y were my s h a r e s . You owned a t h i r d ? Yes, and Mr. Ferguson and Mr. C o l l i n s , t h e y owned a t h i r d each. 205 Q I f you j u s t look a t t h i s , th e loan p o s i t i o n , the 23 second page of t h a t l e t t e r t h a t I r e f e r r e d to you, 24 i t says th e loan p o s i t i o n was on 20th November 1986, 25 £476,950, and then t h e r e were v a r io u s purchases 26 showing th e b a la nc e due on th e loan? 27 28 29 A Yes . That was in 1986? 1 207 Q Now I want you to t u r n to th e l e t t e r of 13th 2 February 1990, which i s j u s t a l i t t l e over t h r e e 3 years l a t e r (Ex hib it 111)? 4 A 5 208 Q Yes . That i s to Ascot Holdings from Ansbacher. Have you got t h a t ? 6 7 A 8 209 Q 9 Yes, I have i t . Do you see t h a t th e f a c i l i t y t h e r e was f o r £1 m i l l i o n ? 10 A 11 210 Q Yes . That, i n f a c t , was the debt which was th e n owed by Ascot Holdings to Ansbacher; i s n ' t t h a t c o r r e c t ? 12 13 A 14 211 Q Yes . You look back a t th e l e t t e r of 10th January 1990, to 15 Mr. Furze, and a copy of which was s e n t t o you, the 16 ba lan ce which w i l l be due a f t e r th e funds being 17 c r e d i t e d on 22nd January 1990 w i l l be S t e r l i n g 18 £1,015,037? 19 A 20 212 Q Yes . Can you e x p l a i n how the o v e r d r a f t , because t h i s 21 a p p a r e n t l y was on an o v e r d r a f t f a c i l i t y , had gone up 22 between th e end of 1986 and th e e a r l y p a r t of 1990, 23 from £500,000 odd to £1 m i l l i o n odd? 24 A Could you give me t h a t f i r s t da te again? 25 You see, th e l e t t e r t h a t I was r e f e r r i n g t o , of 21st 26 December, showed t h a t Ascot Holdings th e n owed a 27 l i t t l e over £500,000 and i t owed on 10th January 28 1990 a l i t t l e over £1 m i l l i o n . 29 f u r t h e r s h a r e s in the i n t e r v e n i n g p e r i o d (Exhibit Did i t purchase 1 2 3 th e n th e y gave loans to th e o t h e r - - i f you see the 4 l e t t e r of 28th May 1990 - - have you got t h a t out, 5 Judge C o s t e l l o (E xhibit VI? 6 214 Q. 7 A. 8 215 Q. 9 A. What i s th e da te? 28th May 1990. What page i s i t ? I am s o r r y , i t i s in t h e s e documents: 10 "Re: 11 Dear Jim, I am su re t h a t the t h r e e of you have c l e a r f i g u r e s in your r e c o r d s but j u s t i n case! 12 ASCOT 13 16 March 1987, September 1987 and March 1988 had advances made ex Ascot t o look a f t e r o t h e r items f o r th e t h r e e of you as follow: J . S . McC. S t g . £161,768.86 V.F. £134,121.85 17 C.J.C. 14 15 £179,729.08 18 19 £475,619.79 20 21 22 In a r r i v i n g a t the ba la nc e of I n t e r e s t due as a t 31/5.1990 I have ta ken i n t o account th e fol lo wi ng payments made: 23 24 By J . S . McCarthy By Vincent Ferguson Stg. £14,675.07 Stg. £7, 449.78" 25 26 27 Now, th os e items were i n t e r e s t payments and c a p i t a l 28 repayments. 29 a t the end f o r £475,619. They show th e t h r e e names and th e b i l l I f you add t h a t t o the 1 l e t t e r of 543 in 1986, t h a t a ppr oxim atel y makes the 2 m i l l i o n pounds. 3 216 Q 4 Will you go back to th e l e t t e r of 13th February 1990? 5 A 6 217 Q Yes . The l e t t e r r e f e r s to th e s e c u r i t y and a memorandum 7 of d e p o s i t over in ve st m en ts , and th e quoted 8 inve st me nts which are r e f e r r e d to are 535,000 9 A t l a n t i c Resources p i c s h a r e s , 475,000 F i t z w i l t o n p i c s har es? 10 11 A 12 218 Q Yes . Are t h e s e th e s h a r e s which th e company purchased on 13 your b e h a l f , which you r e ga rd ed y o u r s e l f as the 14 owner of th e s h a r e s but were in t h e i r name? 15 A 16 219 Q 17 A 18 220 Q I reg a rd ed myself as th e owner of a t h i r d of them. A t h i r d of them? Yes . I see. But, th e b e n e f i c i a l owner of t h e s e s har es 19 was y o u r s e l f and your two c o l l e a g u e s , Mr. Ferguson 20 and Mr. C o l l i n s . 21 A 22 221 Q Is t h a t th e p o s i t i o n ? T h a t ' s r i g h t , yes. We know, Mr. McCarthy, t h a t th e A t l a n t i c Resources 23 sh ar es were so ld , were th e y n ot, i n o rd e r t o pay o f f 24 th e debt? 25 A 26 222 Q 27 A 28 223 Q 29 A That i s r i g h t . What happened . . . (INTERJECTION). Well, not - - s o r r y to i n t e r r u p t t h e r e . Yes . 1 th e y were so ld to pay o f f some c a p i t a l repayments 2 and i n t e r e s t repayments. 3 224 Q. 4 A. 5 225 Q. 6 A. 7 226 Q. 8 A. 9 Were they a l l s o l d or some of them sold? They were not a l l so ld . Again, in whose name are th e y r e g i s t e r e d now? You mean th e ones t h a t were not sold? Yes. I t h i n k t h a t a l l of th o s e were so ld , except about a hundred and something thousand, which would have 10 been my t h i r d of Ascot. 11 never s old . 12 227 Q. 13 A. Now, th os e s ha r es were They are in my name. Your name? Yes. Because, when I went to Dr. O ' R e i l l y and s a i d 14 that, ' I want you to go s e c u r i t y f o r m e , ' which he 15 did , and then when he took over my debt I s a id , 16 'Well, look, here i s a t h i r d of th e Ascot s t u f f , ' 17 and he s a i d , 18 t a l k about them a f t e r w a r d s when you s o r t out your 19 other problem s.'. 20 228 Q. 21 A. ' I d o n ' t want i t , j u s t keep i t , we w i l l Are th e y r e g i s t e r e d i n your name? What I did with them then i s I put them i n t o a 22 fam ily t r u s t , and t h a t i s where t h e y are now, and 23 the F i t z w i l t o n sh ar es as w e ll. 24 229 Q. 25 The F i t z w i l t o n sh ar es were not sold? 26 A. 27 230 Q. 28 A. 29 That i s what I wanted to ask about. I am sure t w o - t h i r d s of them were so ld . Was t h i s in o r d e r to pay ...(INTERJECTION). I was only i n t e r e s t e d , Judge C o s t e l l o , i n o n e - t h i r d , and t h a t was th e t h i r d I was allowed t o keep when I 1 was out of Ascot, and Dr. O ' R e i l l y s a i d , 2 keep them, put them away somewhere and we w i l l t a l k 3 about them a f te r w a r d s when you s o r t out your o t h e r 4 pro ble m s . ' . 5 231 Q 'Look, j u s t Well, now, Dr. O ' R e i l l y ' s wife p a i d th e money to you, gave you a g i f t of th e money, th e £1 m i l l i o n ? 6 7 A 8 232 Q 9 A 10 233 Q 11 A 12 234 Q 13 A Yes . What d id you do with i t ? I p a i d o f f th e loan. The loan? Yes . On which company? Well, you see, what happened then was t h a t my p a r t 14 of the Ascot loan was put i n t o Medford and i t a l l 15 became Medford, as i s shown on t h a t document t h e r e . 16 That i s then how i t was p a i d o f f . 17 235 Q 18 19 What happened to th e F i t z w i l t o n s ha r es which had been i n th e name of th e company? A My t h i r d of th o s e are s t i l l t h e r e , t h e y were never sold. 20 21 236 Q 22 A Where are th e y r e g i s t e r e d ? They are in a family t r u s t . I got my A t l a n t i c 23 sh ar es and my F i t z w i l t o n and put them i n t o a family 24 tru st. 25 237 Q Are th e y r e g i s t e r e d i n your name or are th e y 26 r e g i s t e r e d in th e name of th e t r u s t e e s i n th e family 27 trust? 28 A 29 238 Q They a re , yes. Which i s i t ? 1 2 239 Q 3 So, t h e s e a re r e g i s t e r e d now in th e name of the bank? 4 A 5 240 Q Yes, t h a t i s r i g h t . Perhaps you might j u s t t e l l us what a c t u a l l y 6 happened when you p a i d o f f th e loan? 7 r e g i s t e r e d in th e name of Overseas Nominees. 8 you a c t u a l l y a rr a n g e a s har e t r a n s f e r ? 9 A 10 241 Q 11 A 12 242 Q They had been Did Sorry, I p a i d o f f the lo a ns . You got £1 m i l l i o n from Dr. O ' R e i l l y ' s wife? Yes . With t h a t you were ab le to pay the i n d e b te d n e s s . 13 The sh ar es t h a t s t i l l e x i s t e d were i n th e name of 14 Overseas Nominees, but th e y ended up i n th e Bank of 15 I r e l a n d t r u s t e e company. 16 share t r a n s f e r , did you not? 17 A 18 You must have e f f e c t e d a I do not t h i n k you would have to , would you? Oh, s o r r y , going i n t o the t r u s t e e company? 19 243 Q 20 A Yes . To be q u i t e hone st with you, I d o n ' t know, but I am sure ...(INTERJECTION). 21 22 244 Q 23 A 24 Who handled i t f o r you? Whatever was done, the Bank of I r e l a n d - - Noel Corcoran handled t h a t . 25 245 Q 26 A 27 Mr. Corcoran? Yes, I am almost c e r t a i n he d id . I t was a number of years ago. 28 246 Q 29 A I t was 1997, i t was t h r e e ye ars ago? 1 2 3 247 Q 4 A 5 248 Q And Mr. Corcoran was han dlin g i t ? Yes, I t h i n k so, yes. Very well the n, thank you, Mr. McCarthy, t h a t i s 6 all. 7 i n a couple of days' time to si g n th e t r a n s c r i p t . 8 A We w i l l r e q u i r e you, Mr. McCarthy, t o come in Very good, yes. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED 092??.4 Amp/W 3P4 r> / > fT <©' J.D.T. to P.O*D. • ‘ •* 19th April 1977. '* ... *• ''**■ . •• C o u ld y o u p le a s e a rra n g e to s e n d & ch eq u e1 f o r £ 3 ,5 0 0 . w ith th e * fo llo w in g l e t t e r Upon y o u r s e lf to ; .. H r . P .L .O . K in d e r , D e p u ty M a n a g e r, U ls te r B ank U n it e d , Colle g e .-G r e e n . D u b lin 2 . Th e am ount s h o u ld b e - A c c o u n t. - D e a r S ir , • A t t l le re q u e s t o f U r . J .8 . M c C a rth y we h a v e p le a s u r e 'in a tta c h in g h e r e to d r a f t p a y a b le to h im f o r £ 3 ,5 0 0 a n d w o u ld b e g r a t e f u l i f yo u w o u ld lo d g e i t to h is a c c o u n t a n d a d v is e h im 'o f th e p o s itio n . Y o u ra e t c . G U I N N E S S M A H O N C A Y M A N TRUST UMTT5D A Mene* el »■ Qumnws Mahon Maichart Sarang Qumo TitfaohonaNo (909-0*1 94463/4 ».a 90S 817 T am O m Cayman CP4303 Caote A Acflm g M lQurnnan Britan W « intiaa ™ 3lsc J>m h W 1986 your raf our rat JA F : n J . D . T ra y n o r Esq. 3 T r in i t y S tre e t D u b lin 2 IRELAND ■ Dear D es, R E : A s c o c H o ld in g s Che f o l l o v i n g t r a n s a c t io n s cook p la c e Led. c h i? PU R C H A S ED 2 0 0 .0 0 0 4 0 ,0 0 0 A t Lane i c R e s o u rc e s A c l a n c i c R e s o u r c e s C a l l Op c i o n s ' 4 9 , 8 1 6 .0 0 2 ,1 3 8 .0 0 5 1 ,9 5 4 .0 0 SOLD 5 0 ,0 0 0 A m ou nE p a i d F itx w ilc o n a n 1 s t D e e m b e r 1985 3 8 ,0 9 3 .2 5 £ 1 3 ,8 6 0 -7 5 PURCHASE!? 1 7 5 .0 0 0 Abov* A tla n d c R e s o u rc e s £ 4 6 ,3 6 1 .1 4 a n o u n e p a i d o n 1 3 th D e c e m b e r 1 98 6 / c o n c 'd Ik - '■ • •tdVIMMl St***7 I * L L L \ J. r<. Cravr. — I'ac. J je V P hn d 7r '.C*C i h a re s p re s e n tly y v - ' n S R c .» c . r .- * s s 'r a r a s . T li* lo a n * c u * r r i t l « ta f f m iis . p e n s '* -'r - UkP \i\iir.L «■ J in F i t * v i ! ‘ 'n th r o ^ jlt S h * * i l l y w « ha--er 4&>000 A . R . 3 ^ S I 0 0 f t f rJ lc w s tN o ve m b e r 1 9 6 4 4 7 5 ,1 1 0 .9 6 . I . li P u rc h a s e s - net - P u rc h a s e s s e e a b o ve In te re s t - so 3 l » c sae a b o v r 1 3 . 8 6 0 .7 5 & 6 ( 3 6 1 .1 & D e ce m b e r 19A6 3 . 7 3 7 . (!4 £5*.2,<}10.77 ‘ 'j The lo a n has been rtn c v a d fo r a fa rth e r a o n th To u rs at 13 s in c e re ly , J # V* •J • JOHN A. FUFZE J j i J J i J i ................................................. 1/8% ............................................... per a n n «tn . 1 c * /.ar A M tm b tr o fth * H tm y A m b a th r n N o U to p M ~ C S d v d m u B a n k in t G ro u p I P.O. Box M7. Qraod Cayman, Briddi W«m ladkt Pfconsc t«0») 94*463)1* T eto CP *303 F ts (t09) 949.7946 { # » )9 4 « tt7 FeteuarylS, 1990 JA F ta l Ascot Holdings Uidtwrt . P . O . B o x 887 Grand Cayman, B.W.I. Dear S ir s : . Wa write to ccnfitni our willingness to extend the owrdraft facilities node avail­ able to y o u , on the following terms and conditions: 1 at * d w a x ® 1. MDoanb S t g . 1 ,0 0 0 ,0 0 0 .0 0 2. V&L v m D a t e 1 s t F tib tu u X y 1990 3. t t e t u r i t y D o te 1 s t A u g u s t 1990 4. I n t e r e s t B a te 90 d a y ZJB Q R p l u s 2 « p . a . « 5. Pre-Payment Penalty MIL , 6. OoamLlwint Vtm MIL ' 7. napqyroants Xntacest only to be paid nmthly . ate t h e a o d o f e a c h r o n t h n c cn w ric in g 2 8 th F e b r u a r y 1990 . 8. P r i n c i p a l Sepa yn a B t 9. Security O n o r b e f o r e 1 s t A u g u s t 1990 & Meagcandntt of Deposit over q u o te d i & M s t a s B t s p l u a p e rg o n a l g u a ra n te e (s e e b e lo w ) T h e q u o t e d in v e s t m e n t s r e f e r r e d t o i n (9 ) a b o ve c o n s i s t o f : 5 3 5 .0 0 0 A t l a n t i c R a e o uroes p i c S h a re s 4 7 5 .0 0 0 F i t s w l l t c n p l o Sbaxas Th e p e rs o n a l g u a ra n te e i a t h a t o f t o S t g . 7 5 0 ,0 0 0 .0 0 . . ‘ _ t » c o v e r a n am ount o f up ST jw o t an , g z / T p / o z t I P a g e t 2 o x 2 ■ '• . _ ' Ih e investm ents re fe rre d to on th e preceding page aia j bglatBcad in tb s t m m o f our w holly owned su b sid iary, OWBBSEM EOGNEES L3METED, and are h eld by us in K bzife custody. ■ lb acknavledgenent and acceptance o f th a ftaragoing t enae and oo n d itixaM , and in i* re cognitio n th a t in our capacity as d irac tn ra and ofCLoecs o f ASOOT pxDDKS [ j LBOTED wa nay execute Whatever docaractatio n ia required to perfect? the eeco rity o f th e le a d e r, AMSBBTHKR EM nED , we should be g ra te fu l i f you would! k in d ly sign . and re tu rn th a aoaarpw yio g copy a f th is lib b e r. ; faithfully» m 768144/763085 4 2 FITZVyiLLIAM SQUARE.. taaimilw 612038 DUBLIN 2. 10th January, 1990 Vincent ferguson, Esq., Fitzwilton pic, 1 Upper Hatch Street, DUBLIN 2. Dear Vincent, I have been advised by John Purse that on Friday he sold 76,750. shares at Stg«1*25 and on Monday .69,763 a t ’Stg.1.22. The total sale was therefore 146,513 shares (leaving a balance of 475,000 shares) producing a net amount of Sfcg.El79,534.90 for settlement on 22nd January 1990. The balance which will be due - after the funds have been credited on 22nd January 1990 - will he Stg.£1,015,037.90. Will you please arrange to let Joan have Stg.£15,037.90 on the* 31st January 1990 (X am due to be in Cayman on that- day) and she will advise me. Cayman will then arrange to issue a new facility letter to the end of July 1990 as agreed with you. Please confirm you will handle with Joan. Kindest regards, . , J.D. Traynor c.e. j.s* McCarthy, Bag a 42 FIT2WILUAM SQUARE "W. 7IMS144/7NO0B F*K*lm(»>-. tP03fS DUBLIN 2. 2 8 t h M ay 1 9 9 0 . S T R I C T L Y PKRSO HAL J . S . M c C a rth y , E s q ., F ita v ilt o n p ic , 1 O p p e r B a tc h S t r e e t , D U B L IH 2. ?*.• '' **. — --- -----—;- Dear J in , ...... ..................... ' I an s u ra th e th re e o t you have c le a r b u t ju s t in e « u ! ■ f ig u re s in y o u r re c o rd a - M a r c h 1 9 8 7 , S e p t e m b e r 1987 a n d M a rc h 1 9 8 8 h a d a d v a n c e s s a d * e x K s c o t t o l o o k a l t e r o t h e r At a n s f o r th re e o f yo u as f o llo w s : J .S .K c C . S t g . E U I ,7 6 8 .8 6 YKV . £134,121.85 Y > c)c 812ii222*sa 6175,619.79 I n a r r i v i n g a t t h e b a la n c e o f I n t a r e s t d u e e » a t 3 1 / 5 / 1 9 9 0 h a v e t a k e n i n t o a c c o u n t t h a f o l l o w i n g p a y m e n t s «a d e * By J . S . By X M c C a rth y K jt. t St«.B l4,675.07 Stg. E 7 , 449.78 X o u rs s in c e r e ly , J.D . Tra v n o r. c.c. • JD T/AJW *A Appendix XV (169) Ms Barbara Breen 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Barbara Breen. a) Transcript o f evidence o f Ms Barbara Breen dated 12 March 2001. PRIVATE EXAMINATION OF MS. BARBARA BREEN UNDER OATH ON MONDAY, 12TH MARCH 2001 I hereby c e r t i f y the fo llowing to be a true and accurate t r a n s c r ip t of my shorthand notes in the above named int erview. Stenographer The I n s p e c t o r s : HIS HONOUR JUDGE O'LEARY MS. MACKEY BL S o l i c i t o r to the Inspectors MR. T. SLAVIN In te r vi ew e e : MS. BARBARA BREEN Represented by: MR. J. LEYDEN & MS. A. CORRIGAN ARTHUR COX EARLSFORT CENTRE EARLSFORT TERRACE DUBLIN 2 WITNESS MS. B. BREEN I EXAMINATION MS. MACKEY JUDGE 51 PAGE 50 68 1 2 3 4 5 MS. MACKEY: Good morning, Ms. Breen. 6 MS. BREEN: Morning. 7 MS. MACKEY: Thank you very much for 8 9 coming. I will j u s t introduce those of us who are here although 10 we have already said h e l l o to you. 11 Judge Sean O'Leary and I am Noreen Mackey. 12 i s our colleague Tom Slavin, who w i l l be taking a 13 note, and we have our stenographer here, who w i l l 14 be taking a d e t a i l e d tr a n s c r ip t of the int erview. This i s This 15 16 We are two of the four Inspectors appointed by the 17 High Court and we are the two who w i l l be dealing 18 with any matters r e l a t i n g to you and the other two 19 Inspectors w i l l not be taking any part in i t . 20 21 This, as you know, i s not a Tribunal and i t i s not 22 a Court. 23 under oath i t i s otherwise quite informal. It i s an interview and although i t i s 24 25 I f at any stage you want to ask your s o l i c i t o r or 26 your l e g a l advisors advice about anything j u s t t e l l 27 us and we w i l l stop. 28 29 1 advise Ms. Breen about anything ask us and we w i l l 2 stop. 3 MS. BREEN: Thank you. 4 MS. MACKEY: I f by 11 o 'c lo c k we have 5 not fi n i s h e d we w i l l 6 probably take a ten minute break and you can have 7 a cup of tea or c o f f e e , which we w i l l provide for 8 you here, and we w i l l come back again. 9 10 I w i l l now administer the oath and we can get under 11 way. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 5 1 Q. MS. MACKEY: Ms. Breen, j u s t for the 6 record I would l i k e to 7 get a l i t t l e b i t of background; your own sort 8 of p r o f e s s io n a l business background and so on. 9 Are you at the moment working or...(INTERJECTION)? 10 A. Yes. 11 2 Q. Yes. 12 A. 13 3 Q. 14 A. 15 4 Q. 16 A. Managing Director. 17 5 Q. Managing Director. 18 19 A pet food manufacturing company. Yes? Merops (Nutrition) Limited. Merops ( N u t r i t i o n ) . A. Six years but I have worked in the company since 6 Q. Right. What was your p o s i t i o n prior to becoming Managing Director? 23 A. Financial Director. 24 7 Q. Financial Director. 25 29 Had you been on the Board for some time prior t o . . . (INTERJECTION)? A. 27 28 Have you held that p o s i t i o n i t was founded. 22 26 What i s your p o s i t i o n there? for long? 20 21 Where do you work at present? Yes, I would have been on the Board since I think the ea rly 1980's. 8 Q. Early 1980's. Have you any other Directorships or 1 Yes, there are two other companies; Windsor Foods 2 Limited and Windsor Nutr itio n Limited. 3 English company and the other i s an I r i s h company. 4 9 Q 5 A 6 10 Q 7 A 8 11 Q 9 A 10 12 Q 11 A 12 13 Q 13 Which i s which? Windsor Foods i s an English company. Right, and Windsor Nutrition i s . . . ( INTERJECTION)? Windsor Nutr itio n i s based in the north of Ireland. Right? I t ' s an I r i s h company. A ll r ig h t . It i s s t i l l functioning; i s i t ? Yes, as a s e l l i n g company. As a s e l l i n g company. JUDGE O'LEARY: Is that r e g i s t e r e d in 14 15 the Republic of Ireland? A 16 I t i s , yes. JUDGE O'LEARY: It ju s t operates in the 17 18 North. A 19 20 One i s an 14 Q Yes . JUDGE O'LEARY: Yes, I see. MS. MACKEY: I had understood that 21 I see. was c los ed down around 22 the end of 1980's; i s that so? 23 A 24 15 Q 25 A 26 16 Q 27 The manufacturing unit was c los ed in 1989. I see? But i t ' s now ju s t a small s e l l i n g company. I see. However, there was no question of i t being wound up or anything? 28 A 29 17 Q No. I see. Thank you very much. 7 I think that i s fi n e 1 2 A. 3 18 Q. Right. You sent us in a statement, Ms. Breen. Do you have 4 a copy of i t there because I would l i k e to r ef er to 5 it? 6 A. 7 19 Q. 8 A. 9 20 Q. 10 No, I don't a c t u a l l y . We can give you a copy? Yes. You can ju s t look at i t there (Same Handed), Exhibit 1? 11 A. 12 21 Q. 13 Thank you. In t h i s you s e t out y o u r . . . (INTERJECTION). JUDGE O'LEARY: Would you l i k e a biro 14 and paper, Ms. Breen, or anything l i k e that? 15 16 A. 17 18 JUDGE O'LEARY: A. 19 20 No, I have a pen. 2 2 Q. Thank you. Have you? Yes. JUDGE O'LEARY: A ll r ig h t , grand. MS. MACKEY: I f we can j u s t have a 21 Yes. look at t h i s statement, 22 Ms. Breen? 23 answers to the questions that he had asked you in 24 our i n i t i a l l e t t e r and you s e t out the two contacts 25 that you b e l i e v e you had with the company we are 26 investigating? 27 28 29 A. Yes. You s e t out in i t very h e l p f u l l y the 1 24 Q. 2 Which used to be c a l l e d Guinness Mahon Cayman Trust and a number of other names? 3 A. 4 25 Q. 5 Yes. You s t a r t o f f by t e l l i n g us about the property you purchased in Portugal in 1980? 6 A. 7 26 Q. 8 Yes. You discusse d the proposed purchase with Des Traynor? 9 A. 10 27 Q. 11 A. 12 28 Q. 13 Yes. Who you say was a personal frie nd of yours? Yes. Did you have at that stage - - where you working with Merops and Windsor at that point in 1980? 14 A. 15 29 Q. 16 A. 17 30 Q. 18 A. 19 31 Q. Yes. You were. Were you Financial D ir e c t o r /C o n t r o ll e r ? Yes. In both of them? Yes. Did e it h e r of those companies, or did you 20 perso na lly , bank with Guinness & Mahon prior to 21 that date? 22 A. No, the companies did n't bank - - we would have used 23 Guinness & Mahon in r e l a t i o n to French Francs. 24 one point I know we were r e c e iv in g a l o t of French 25 Francs and there was a vat s i t u a t i o n in whereby we 26 had to pay vat in France before our products went 27 in and we di d n' t rec e iv e i t back for months l a t e r 28 and we were - - I can't remember what the word i s . 29 At 1 2 32 Q. 3 A. 4 33 Q. 6 A. 7 34 Q. 8 Prior to 1980? Yes. What about you personally? Did you have a banking r e l a t i o n s h i p with them? A. 10 I had a borrowing with Guinness & Mahon in the l a t e 1970's. 11 35 Q. 12 A. 13 36 Q. 14 A. 15 37 Q. 16 Yes? In order to purchase a house. Yes. This was n o t . . . ( INTERJECTION)? Which was a three year loan. This was not the same house that we are ta lk in g about here? 17 A. 18 38 Q. 19 A. 20 21 That i s the only time I can remember I using Guinness & Mahon. 5 9 Right? No, no. This was here in Ireland. I see? A three year loan and I - - i t was paid back over three y e a r s . 39 Q. Yes. Can I ju s t get some kind of background on your 22 connection with Guinness & Mahon because as you know 23 i t i s through Guinness & Mahon that one has the 24 connection with "Ansbacher"? 25 A. 26 40 Q. Yes. When did you f i r s t enter int o some kind of business 27 r e l a t i o n s h i p with Guinness & Mahon? 28 Mr. Traynor, who I b e l i e v e was a fr ie nd of yours? 29 Was i t through 1 Mr. Traynor' s wife was my next-door neighbour when 2 I was a ch il d . 3 41 Q. 4 A. 5 42 Q. 6 A. 7 43 Q. 8 A. 9 So, I have known Mrs. Traynor a l l my l i f e . Yes. Through Mr. Traynor then? So, through Mr. Traynor then. You came to bank with Guinness & Mahon? We di d n' t a c t u a l l y bank with Guinness.. . (INTERJECTION). 10 44 Q. 11 A. 12 45 Q. 13 A. 14 4 6 Q. Borrow? With Guinness & Mahon. To borrow with Guinness & Mahon? Yes. Why did you decide to approach Guinness & Mahon rather than whatever your own bank was at the time? 15 16 Yes? A. Because I knew Mr. Traynor and I was - - at that 17 stage I was buying a house. 18 d ifficu lt. 19 47 Q. 20 A. 21 48 Q. 22 A. 23 49 Q. 24 A. It was extremely Yes? Women di d n' t get loans from bui ldi ng s o c i e t i e s . Yes? And things in those days. Yes? And ev en tu all y the I r is h Permanent gave me a loan 25 of part of the money and the balance Mr. Traynor 26 said he would organise for me and I paid i t back 27 over three y e a r s . 28 29 50 Q. I see. I would ju s t l i k e to show you a document, 1 2 Exhibit 2 and Exhibit 3)? 3 Thank you. 4 51 Q 5 You see t h i s document, Ms. Breen? You see your name there sort of halfway down i t ? 6 A 7 52 Q 8 A 9 53 Q Yes . Towards the end? Yes . This i s a Guinness & Mahon in t e r n a l document 10 d e t a i l i n g loans that were given to d i f f e r e n t 11 people and t h i s i s d e t a i l i n g a loan in 1977 12 with the return date of the 30th December 1978; 13 do you see that? 14 A 15 54 Q 16 I t i s a loan for £8,000 s t e r l i n g . Would that be, do you think, the loan that you are ta l k i n g about? 17 A 18 55 Q 19 A 20 21 Yes . I think i t could. The date i s 1977? Yes ? December 1977. Are you - - i s t h i s saying that i t was paid o f f by December 1978? 56 Q No, the date that i t was due to be paid o f f was 1978 22 but we see on the next document that in fa c t i t was 23 extended for a further year. 24 r e a l l y asking you i s : 25 loan that you were t e l l i n g me about a few moments 26 ago? 27 28 29 A However, what I am Is that the amount of the (I n d i c a t i n g ) . This i s l i k e l y to be the loan? 1 2 3 5 9 Q. 4 A. 5 60 Q. Yes? But i t i s l i k e l y to be tha t. Yes, i t seems that i t i s . What I would l i k e you 6 to look at there on that document i s : 7 loan and then the l i m i t and then the i n t e r e s t rate 8 and the maturity date and then you have You see the 9 10 "Security" 11 12 do you see that? 13 A. 14 61 Q. Yes. I t says: 15 16 "Suitably secured." 17 18 And that i s in inverted commas and then we have: 19 20 "Guarantee completed by T. McLoughlin." 21 22 I t i s r ef er ri n g to two types of s e c u r i t y there. 23 One i s a guarantee by Mr. McLoughlin, who I think 24 was connected with Windsor and Merops; i s that not 25 correct? 26 A. 27 62 Q. Yes. And the other i s s u i t a b l y secured. I do not know 28 i f you are fa m ili ar with the expression "suitably 29 secured" as used by Guinness & Mahon as a 1 d e s c r ip t io n of loans? 2 about i t in the media? There has been some t a l k 3 4 63 Q. So, I think you may have heard about i t . "Suitably 5 secured" Guinness & Mahon have t o l d us when placed 6 in inverted commas l i k e that means secured on a 7 depo sit held with one of the o f f shore s u b s i d i a r i e s 8 of Guinness & Mahon. 9 cash backed loan? 10 A. 11 64 Q. B a s i c a l l y i t means i t i s a Right. And that part of the s e c u r i t y used was de pos its 12 somewhere o f f shore, e it h e r in "Ansbacher" or in 13 i t s Channel Islands su bsidiary. 14 i s so described. 15 on an o f f shore deposit and I was wondering i f you 16 could throw any l i g h t on that for me? 17 A. Your loan in 1977 It i s described as being backed I have no idea why that should have been. I think 18 Mr. McLoughlin might have guaranteed i f I - - to 19 Guinness & Mahon i f I di d n' t repay the loan that 20 he would have repaid i t . 21 65 Q. 22 A. 23 66 Q. 24 A. 25 67 Q. 26 But I have no idea; the s u i t a b l y . You cannot ...(INTERJECTION)? No. We w i l l come in a few moments to what you t o l d us in your statement about a fund being s e t aside for you? 27 A. 28 68 Q. 29 Yes? Yes. By Mr. McLoughlin? 1 69 Q. 2 A. 3 70 Q. 4 Yes. Did you prior to 1980, prior to Mr. McLoughlin s e t t i n g aside the funds, have funds o f f shore? 5 A. 6 71 Q. 7 A. 8 72 Q. 9 A. 10 73 Q. 11 No. With them? No. You did not? No. Is i t p o s s i b l e that t h i s could r ef er to funds o f f shore held by Mr. McLoughlin himself? 12 A. 13 74 Q. 14 A. 15 16 However, that was la te r? I wouldn't think so, no. You would not think so? No. In fa c t I - - w e ll, I can't say I know. I t ' s not - ­ 75 Q. I see. I f you ju s t look at the next page, 17 Exhibit 3. 18 You can see up at the top there: Again i t i s more of the same r e a l l y . 19 20 "Miss Barbara Breen - EXTENSION." 21 22 A. 23 76 Q. Yes. This i s saying - - sorry, a c t u a l l y t h i s i s the 24 previous year, as I now see, because the review 25 date i s the 20th December 1977; do you see that? 26 A. 27 77 Q. Yes. So, obviously i t had been extended already; 28 perhaps from the previous year. 29 one we looked at was the l a t e r year. So, the f i r s t However, 1 2 3 "Guarantee of T. McLoughlin held. Suitably secured." 4 5 6 I t i s again described that way? 7 A. 8 78 Q. 9 A. 10 79 Q. 11 I have not idea why that i s . You have no idea? No. Okay, we w i l l pass on from th at. Getting back to your statement, Ms. Breen? 12 A. 13 80 Q. 14 Yes. You t e l l us about the purchase of t h i s property in Portugal? 15 A. 16 81 Q. Yes. And you had discus sed the proposed purchase with 17 Mr. Traynor and you explain that you had been 18 advised that there where s u b s t a n t i a l taxes i f you 19 passed on t h i s property i f i t was in your own name? 20 A. 21 82 Q. Yes. So, Mr. Traynor advised that you put i t in the name 22 of a company. 23 what e x a c t ly i t was he said to you about that? 24 A. 25 I ca n' t r e a l l y remember the d e t a i l s of the c on ve rs at io n . 26 83 Q. 27 A. 28 84 Q. 29 Can you remember the conversation and May be i f I ask you a few s p e c i f i c questions? I t was . . . (INTERJECTION) . I know i t i s a long time ago. We are going back 1 2 3 Yes . 85 Q 4 And he said to you that i t would be b e t t e r that i t was not in your own name? 5 A 6 86 Q 7 A 8 87 Q 9 A 10 That was - - no. No? I t was a lawyer in Portugal. Yes? Who f i r s t r ais ed the i s s u e of the house not being bought in my name because I di d n' t have children. 11 88 Q 12 A 13 Yes ? And the taxes was p r o h i b i t i v e in - - inh eritance taxes were p r o h i b i t i v e . 14 89 Q 15 A 16 Yes? And she said she thought the company should be bought - - the house should be bought by a company. 17 90 Q 18 A 19 91 Q 20 A 21 92 Q 22 A 23 93 Q 24 Yes. She said t h i s to you or to Mr. Traynor? No, to me. To you. Yes? Mr. Traynor I think wouldn't h a v e . . . (INTERJECTION). Was not involved in i t at that stage? I don't think he was involved in th at. Did you say t h i s then to Mr. Traynor; i s that what happened? 25 A 26 94 Q 27 A 28 95 Q 29 A I would have said that to Mr. Traynor. Yes? And he said he could organise an o f f shore company. Right? My understanding was that there was nothing wrong 17 1 2 96 Q 3 Did he say to you where the company was? 4 A 5 97 Q 6 A 7 98 Q 8 9 He did not? No. So, you were not aware that t h i s was a company.. . (INTERJECTION)? A 10 He gave me the name of the company w h ic h .. . (INTERJECTION). 11 99 Q 12 A Yes. He t o l d you the name of the company? The name of the company which I then gave to the lawyer. 13 14 No. 100 Q 15 This company was simply to hold the property in your name; i s that i t ? 16 A 17 101 Q Yes . With regard then to the payment for the house: 18 Were funds made a v a il a b le to the company; i s 19 that what happened? 20 A 21 No, I don't think there were funds made av a il a b le to the company. 22 102 Q 23 A 24 103 Q 25 A 26 104 Q 27 A 28 105 Q 29 A Mr. McLoughlin loaned me the money. Right? To buy that house. Yes ? So, the money was brought to Portugal. Yes? To pay for that house. I see, I see? 1 106 Q 2 A 3 107 Q 4 A 5 108 Q 6 A 7 109 Q No. I see? I brought the money to the s o l i c i t o r in Portugal. You p er son all y went over; did you? Yes . Right. Could we look, Tom, at page 158 8 (Same Handed), Exhibit 4? 9 JUDGE O'LEARY: Was that in cash or in 10 11 cheques ? A 12 13 No, i t was a . . . (INTERJECTION). JUDGE O'LEARY: A 14 Or a bank draft? A bank draft . JUDGE O'LEARY: It was a bank dr af t . Drawn on which bank; do 15 16 17 you remember? A 18 Oh, gosh, I couldn't remember. JUDGE O'LEARY: You do not remember, I se e . 19 20 21 do you think? A 22 23 Was i t an I r i s h bank I think i t was an English bank. JUDGE O'LEARY: A 24 25 110 Q 26 A 27 111 Q 28 A 29 112 Q An English bank. I t was a s t e r l i n g - ­ JUDGE O'LEARY: I see, grand. MS. MACKEY: Page 158. You have i t ? Yes . This i s a memorandum, as you see, Ms. Breen? Yes . To Mr. Traynor from John Furze. 19 Are you fam ili ar 1 2 3 113 Q. 4 Yes. He was one of the Managers of Coral Reef; i s that not correct? 5 A. 6 114 Q. 7 Yes. And he was al s o a Managing Director of "Ansbacher" Cayman as i t happened? 8 A. 9 115 Q. Yes. You see t h i s memorandum says: 10 11 "Re: Coral Reef S e c u r i t i e s Ltd." 12 And i t i s dated January 30th 1992. 13 14 15 "Attached i s an invo ic e r e l a t i v e to the above company for administration s e r v i c e s and disbursements for three years to 31-12-91." 16 17 18 19 A. 20 116 Q. 21 22 A. 117 Q. 25 A. 26 29 30 I co ul dn 't. I mean they were companies - - they were - - excuse me, may I just? 24 28 Can you explain to me what disbursements Coral Reef would have been making over the years up to 1991? 23 27 Yes. I f you want to speak t o . . . (INTERJECTION) Ann, I don't know what the l e g a l . . . (INTERJECTION). MS. CORRIGAN: A. The Company's Off ice f e e s . The Company's Of fi ce f e e s . MS. CORRIGAN: Annual f e e s . 1 2 A. F i l i n g fee. 3 118 Q. MS. MACKEY: 4 These would be disbursements made 5 by Coral Reef? 6 A. 7 119 Q. 8 A. 9 Well, that i s the only thing that I know about. Right? Because the fe e s were paid over the years and i t wasn't u n t i l r e c e n t l y that I had ever seen an 10 invoice. 11 120 Q. 12 A. 13 121 Q. 14 A. 15 I see? To do with t h i s . I see. Yes. So, I - - that i s - ­ Do you know Mr. Jack Stakelum, Ms. Breen? He i s a Director of Merops (Nutrition) Limited. 16 122 Q. 17 A. 18 123 Q. 19 A. Yes. 20 124 Q. Yes. I see? Has been for a number of years. He i s a Director of Merops? Because I no ti ce in the Declaration of Trust 21 that you sent us in in connection with the purchase 22 of the Portuguese property? 23 A. 24 125 Q. Yes. That the f i n a l paragraph s t a t e s that in the event 25 of the simultaneous death of y o u r s el f and 26 Mr. McLoughlin i n s t r u c t i o n s for the d i s p o s i t i o n 27 of the property would come e it h e r from Mr. Traynor 28 or Mr. Stakelum? 29 1 126 Q 2 So, Mr. Stakelum then at that stage was aware of your Portuguese transac tion; was he? 3 A 4 127 Q 5 A 6 128 Q He would have been aware. Yes ? That I had a house. Yes. In fa c t he was so i n t im a te ly connected with 7 i t that in fa c t he was appointed by you presumably 8 to be the person who would give in s t r u c t i o n s a f t e r 9 your death; i s that correct? 10 A 11 of the companies for many years. 12 129 Q 13 A 14 15 Yes, Mr. Traynor - - Mr. Stakelum was a Director Yes ? And as Financial Advisor I have know him for many many years. 130 Q 16 Yes, yes. Did he ever pe r so n al ly advise you in connection with your finances? 17 A 18 131 Q 19 A 20 132 Q No; Mr. Stakelum. He did not? No. Yes. I would l i k e to show you a number of 21 documents, Ms. Breen. 22 to show you pages 105, 106 and 175. 23 in that order (Same Handed), Exhibit 5, Exhibit 6 24 and Exhibit 7? 25 A 26 133 Q F i r s t of a l l I would l i k e Thank you. You w i l l see that the pages are numbered down at the 27 bottom, Ms. Breen; do you see that? 28 page 105 f i r s t ? 29 A Tom, please I f you look at 1 134 Q 2 A 3 135 Q Yes . This i s a l e t t e r from a company c a l l e d Hamilton 4 Ross. 5 company; are you? 6 A 7 8 I do not know i f you are fa m ili ar with t h i s From the - - e v en tu al ly from everything that has happened, y e s . 136 Q 9 From everything. As you know i t was at one time one and the same as "Ansbacher" e f f e c t i v e l y ? 10 A 11 137 Q Yes . And held accounts on behalf of c l i e n t s of 12 "Ansbacher" within the general "Ansbacher" scheme. 13 Here we see a l e t t e r from Hamilton Ross with an 14 address which i s in fa c t the address of "Ansbacher": 15 16 "P.O. Box 887, Grand Cayman, Cayman Islan ds." 17 18 19 And up on the top le ft - h a n d corner you see we have: 20 21 "Please r e l y to: 8 Inns Court, Winetavern S t re e t, Dublin 8." 22 23 24 Do you see that? 25 A 26 138 Q 27 Yes . I t i s addressed to a Ms. Paula Hartnett of the I r i s h In te r co n ti n e n t al Bank? 28 A 29 139 Q Yes . You may or may not know what the IIB has to do with 23 1 any of t h i s ; most people who come to see us do not. 2 However, in fa c t what happened was: 3 de po s its that were held in Ireland in Guinness & 4 Mahon up to 1991 were moved to IIB at that stage? 5 A. 6 140 Q. The "Ansbacher" Yes . Mostly unknown to the c l i e n t s who a c t u a l l y held 7 funds in "Ansbacher". 8 "Ansbacher' s " accounts were in IIB rather than 9 Guinness & Mahon. 10 So, from 1991 onwards That i s the only s i g n i f i c a n c e of IIB here? 11 A. 12 141 Q. 13 Yes . Here you see t h i s l e t t e r i s wr itten by Hamilton Ross, somebody on i t s behalf: 14 15 "Dear Paula, ple as e arrange to l e t me have a draft for STG£25,000.00 payable Windsor Nutr itio n Ltd and debit the co st t o . . . " 16 17 18 19 And i t gives an account which you can take i t from 20 me i s the account number of "Ansbacher" in IIB? 21 A. 22 142 Q. 23 A. 24 143 Q. 25 Yes . This i s a s t e r l i n g draft for Windsor Nutrition? Yes . In 1997 were you Managing Director or Financial Director of Windsor? 26 A. 27 144 Q. 28 A. 29 145 Q. Yes . Both or eith er ? I'm - - wel l, I'm s t i l l both I suppose. 1 2 3 Yes . 146 Q 4 5 then? A 6 I would be fa m ili ar with a £25,000 draft lodged to Windsor Nu trit ion . 7 147 Q 8 A 9 10 So, would you be fam ili ar with t h i s tr ans ac tio n Yes? But I wouldn't have known anything about Hamilton Ross o r . . . (INTERJECTION). 148 Q No. However, would t h i s cheque have come to 11 be lodged, or t h i s draft come to be lodged, to 12 Windsor Nutrition? 13 who gave i n s t r u c t i o n s for i t s withdrawal from 14 wherever i t came from? 15 A 16 149 Q 17 A Where did that come from or I would have telephoned Mr. Stakelum. Yes ? And said that we needed £25,000 s t e r l i n g and he 18 would have arranged for t h i s , the £25,000 s t e r l i n g , 19 to be sent to Windsor Nutr itio n in the north of 20 Ireland. 21 150 Q 22 A 23 151 Q 24 A 25 Mr. Stakelum would have arranged i t ? Yes . I see? I don't know how Mr. Stakelum - - I mean I spoke to Mr. Stakelum. 26 152 Q 27 A 28 153 Q 29 A Yes? B u t . . . (INTERJECTION). Yes? 1 154 Q 2 A 3 155 Q 4 5 Yes, I understand. May be we can t e a s e . . . (INTERJECTION)? A 6 7 Mr. Traynor was dead at that stage. Mr. Traynor had money belonging to Mr. McLoughlin. He needed money so t h a t ' s - ­ 156 Q I see. May be we can go back a l i t t l e b i t . We 8 might have got ahead of ourselves here. 9 was looking a f t e r money for Mr. McLoughlin; i s that 10 the s it u a t io n ? 11 A 12 157 Q Yes, yes. Is t h i s money separate from the fund that Mr. McLoughlin had s e t up? 13 14 A 15 158 Q 16 A 17 18 Mr. Traynor No, that i s the same. I t i s the same fund? The same, yes. JUDGE O'LEARY: A Your fund? Yes . 19 JUDGE O'LEARY: Yes. 20 MS. MACKEY: May be we should c l a r i f y 21 whose fund e x a c t l y t h i s 22 was. 23 was s e t aside for you by Mr. McLoughlin? 24 your money to dispose of? 25 A What i s your understanding of the fund that No, I think what I thought, i f I thought at a l l 26 about i t , was: 27 was there i f the roof f e l l in. 28 I f the roof f e l l in? 29 Was i t Is that t h i s was something which 1 160 Q 2 A I f the companies were in d i f f i c u l t i e s , i f 3 Mr. McLoughlin died, i f I were l e f t . 4 a l l a very personal thing. 5 161 Q 6 A 7 This was I understand? This wasn't anything to do with d e li b e r a t e evasion of anything. 8 162 Q 9 A 10 163 Q No, I understand that? I t was - - i t ' s very personal. Yes. What I need to c l a r i f y i s whose fund i t was 11 because the s i t u a t i o n we are in here and the only 12 thing we are tr yin g to do in any of these interviews 13 i s e s t a b l i s h the c l i e n t s of "Ansbacher" because t h i s 14 i s what we have been dir e ct ed by the High Court to 15 do. 16 the c l i e n t s ? 17 A 18 164 Q 19 We are i n v e s t i g a t i n g "Ansbacher" i t s e l f and not Yes . However, we have to, because we were t o l d to, find out who the c l i e n t s were? 20 A 21 165 Q Yes . So, here in the s i t u a t i o n that we are looking at 22 with regard to you we have a fund which i s c l e a r l y 23 an "Ansbacher" fund. 24 A There i s no doubt about that? Yes . 25 And the d i f f i c u l t y we are in i s in deciding whether 26 i t i s your fund or Mr. McLoughlin's fund or indeed a 27 j o i n t fund and as Mr. McLoughlin i s no longer with 28 us ? 29 1 We have to tr y and find out as best we can from you. 2 JUDGE O'LEARY: 3 Could I j u s t say to help, Ms. Breen, i f you would 4 not mind? 5 MS. MACKEY: No. 6 JUDGE O'LEARY: We are not i n t e r e s t e d in 7 any personal matters. 8 They are matters of no concern to us. 9 assured that in s o fa r as and to the extend that we You can r e s t 10 come across any personal matters they w i l l be de alt 11 with in the most d i s c r e t e way with regard to our 12 report. 13 not a thing we are i n t e r e s t e d in at a l l . 14 as Ms. Mackey says we have to find out whose money 15 i t was and that i s r e a l l y our only i n t e r e s t . 16 MS. MACKEY: Absolutely. 17 JUDGE O'LEARY: That i s our only i n t e r e s t . They w i l l not feature in our report. 18 regard to any other worries you might have? A 21 Okay. JUDGE O'LEARY: 22 23 They are not worries; a l l r ig ht ? A 24 25 However, Set your mind at r e s t with 19 20 It is Yes . JUDGE O'LEARY: A You can j u s t ignore those. Well, I think - - excuse me. 26 JUDGE O'LEARY: Yes. 27 Did - - Ann, did you write to the 28 Inspectors o r i g i n a l l y in r e l a t i o n to 29 Mr. McLoughlin's. . . (INTERJECTION)? 1 2 A. 3 4 MS. MACKEY: A. 5 168 Q. 7 A. 8 169 Q. 9 A. 10 170 Q. 11 A. 12 171 Q. 13 A. 14 172 Q. 16 A. 17 Yes? Not having of f er ed i t . Yes? Was Mr. McLoughlin's money. It wasn't - ­ Yes? I t wasn't my money. Right? But the in t e n t i o n was that i f anything happened to Yes? Or I don't know. I r e a l l y don't know. I t wasn't money that was - - came int o the everyday bu siness. 18 173 Q. 19 A. 20 174 Q. 21 A. 22 175 Q. 23 A. 24 176 Q. 25 A. 26 177 Q. 29 The money which Mr. McLoughlin gave to Mr. Traynor, him; i f he died a l o t sooner than he died. 15 28 Yes. having been asked by Mr. Traynor for t h i s money. 6 27 So, the money; i f I may put t h i s corr ect ly ? Yes, I understand? Of e it h e r our l i v e s or of our bu sin ess . Yes? I t was ju s t that money was there. Set aside for a rainy day? Probably, yes. Yes? That i s the bes t way to put i t . Yes. JUDGE O'LEARY: Supposing God forbid, and I am glad i t did not happen, Mr. McLoughlin died in 1987? 1 2 3 a c t u a l l y died in 1987? 4 Yes . 5 JUDGE O'LEARY: 6 7 out there somewhere. A 8 Yes . JUDGE O'LEARY: 9 10 A I d id n 't . I di d n' t r e a l l y . JUDGE O'LEARY: 12 A But I knew i t - - yes. JUDGE O'LEARY: 15 And you knew i t would make i t s way to you eventually? A 17 18 However, you knew the money was there? 14 16 What would have happened the money; did you know? 11 13 There was a lump of money Yes . JUDGE O'LEARY: A A ll r ig h t . I knew that Mr. Traynor - - I tr us te d that 19 Mr. Traynor would take - - give i t to me when I - ­ 20 i f I . . . (INTERJECTION). 21 JUDGE O'LEARY: 22 A 23 24 25 26 When I needed i t or for whatever reason. JUDGE O'LEARY: A I see. I had no reason to b e l i e v e that he wouldn't. JUDGE O'LEARY: A When you needed i t ? Well. . . ( INTERJECTION). Because as far as we were concerned Mr. Traynor 27 was holding t h i s with personal funds. 28 JUDGE O'LEARY: 29 A ll r ig h t . 1 2 Ms. Breen? 3 JUDGE O'LEARY: 4 There i s only one document she has seen so far. 5 MS. MACKEY: Yes . 6 JUDGE O'LEARY: Yes . 7 MS. MACKEY: Yes, but she has three in 8 front of her. 9 10 179 Q JUDGE O'LEARY: Yes . MS. MACKEY: We are looking at the 11 f i r s t one? 12 A Yes . 13 A You s ta r te d to t e l l me that you remember t h i s 14 t r ans ac tio n because you contacted Mr. Stakelum; 15 Mr. Traynor being dead at the time. 16 A 17 180 Q Yes . Was t h i s something that from time to time during 18 Mr. Traynor's l i f e you would do when money was 19 needed for one of the companies? 20 fund was there you would contact Mr. Traynor? 21 Would that be the way i t happened? 22 A 23 I think I had only contacted Mr. Traynor once in r e l a t i o n to - - I think i t was £10,000. 24 181 Q 25 A 26 182 Q 27 A 28 29 Knowing t h i s Yes ? I r i s h pounds. Yes? I think that was the only time I ever contacted him about i t . 183 Q 1 necessary to do so or would you f i r s t check with 2 Mr. McLoughlin or would i t be his d e c is i o n to do 3 i t or how did t h i s happen? 4 I think in r e l a t i o n to that p a r ti c u l a r £10,000. 5 184 Q 6 A 7 185 Q 8 A 9 Yes ? I would have spoken to Mr. McLoughlin. Yes? And said tha t, you know - - because that £10,000 was for somebody. 10 I had guaranteed a loan s t u p i d i t y for somebody. 11 186 Q 12 A 13 187 Q 14 A Yes ? And they di d n' t pay i t and I had to pay i t . So you needed t h i s t o . . . ( INTERJECTION)? And t h a t ' s the only time I can - - but I would 15 have discus sed i t with Mr. McLoughlin; the 16 f a c t . . . (INTERJECTION). 17 188 Q Of course. In regard to t h i s p a r ti c u l a r one here, 18 t h i s one payable to Windsor Nutr itio n ( i n d i c a t i n g ) : 19 Was t h i s something you would disc us s f i r s t with 20 Mr. McLoughlin or would you see that Windsor 21 Nutrit ion for whatever reason needed t h i s lodgement 22 and you would then apply to Mr. Traynor and in t h i s 23 case Mr. Stakelum? 24 A 25 189 Q 26 A 27 190 Q 28 29 Well. . . (INTERJECTION) . Yes ? Mr. Traynor was dead at that stage. Mr. Stakelum? 1 I know but t h i s i s 2 Mr. Stakelum. 3 JUDGE O'LEARY: Yes. Mr. McLoughlin was not 4 dead now at that stage? 5 No, no. 6 MS. MACKEY: No, Mr. McLoughlin was 7 not, no. 8 JUDGE O'LEARY: Yes . 9 MS. MACKEY: Yes . JUDGE O'LEARY: No . MS. MACKEY: I ju s t want to find out 10 11 191 Q 12 now: Did you speak to Mr. McLoughlin f i r s t about t h i s or...(INTERJECTION)? 13 14 A 15 192 Q I would have spoken to him, yes. Would you have said to him, "Look, we need t h i s for 16 Windsor N u t r i t i o n , " or would you have said, "What 17 do you think? 18 t h i s ," or what? 19 A 20 193 Q 21 A 22 194 Q Should we ask Mr. Stakelum to get us I ca n' t remember. You cannot remember? I am sorry. I couldn't remember. Really what I am tr ying to a s c e r ta in i s : Would 23 you f e e l free of your own d e c is i o n to contact 24 Mr. Traynor or Mr. Stakelum; which ever of them 25 was the case? 26 A 27 195 Q 28 A 29 196 Q While Mr. McLoughlin was a li v e ? Yes? No, I would have discussed i t . You would have discussed with i t him? 1 2 197 Q. 3 I see. Would you have wanted his agreement; I mean i f he had said "no"? 4 A. Yes. 5 198 Q. Yes? 6 A. 7 199 Q. I would have. Just t h i s business of Mr. Stakelum: After 8 Mr. Traynor' s death why did you approach 9 Mr. Stakelum about th is ? 10 A. I am tr yin g to think of the circumstances under 11 which I f i r s t would have, we both would have, 12 f i r s t spoken to Mr. Stakelum. 13 200 Q. 14 A. Yes? I'm not c er ta in that i t wasn't even when - - I can't remember when a l l t h i s "Ansbacher" thing came out. 15 16 201 Q. 17 A. 18 202 Q. 19 A. 20 Yes? When i t s ta r te d . Yes? And I think Mr. McLoughlin and myself then were worried. 21 203 Q. 22 A. 23 204 Q. 24 A. In smoke. 25 205 Q. Yes, yes? 26 A. 27 206 Q. 28 A. 29 Yes? That t h i s money was gone. Yes? Because we never had any idea of "Ansbacher". Yes, yes, of course? Or "Ansbacher" accounts or what Mr. Traynor. . . (INTERJECTION). 1 207 Q. So, you may have approached Mr. Stakelum? 2 A. And i t may have been - - I can't remember. 3 208 Q. 4 A. 5 209 Q. 6 A. Yes? I couldn't remember the exact - ­ How would he have known what to do about i t ? I couldn't t e l l you. I couldn't t e l l you th at . 7 I mean I knew Mr. Traynor and Mr. Stakelum were 8 very f r i e n d l y . 9 210 Q. 10 A. 11 211 Q. 12 Yes? And I assumed that he might have known. Yes. JUDGE O'LEARY: 13 Ms. Mackey i s making to 14 15 I think the point that you i s . . . (INTERJECTION)? A. 16 Sorry. JUDGE O'LEARY: 17 Of a l l the people in the whole world faced with 18 t h i s problem; Mr. Traynor i s dead and you want 19 to get access to your money. 20 A. 21 Yes. JUDGE O'LEARY: 22 23 24 It does not matter for the moment whose money i t i s . A. Yes. JUDGE O'LEARY: 25 Of a l l the people in the whole world you decide to 26 approach, the person you decide to approach i s , 27 Mr. Stakelum. 28 29 1 than me and t h i s man 2 in d ic ati ng ) or anybody at a l l ? 3 B u t . . . (INTERJECTION). 4 MS. MACKEY: Or Mr. Collery indeed? 5 JUDGE O'LEARY: Or anybody or Mr. Collery, 6 who was deeply involved in 7 8 a s s i s t i n g Mr. Traynor? A 9 been because we knew Mr. Stakelum so w e ll . 10 11 For me i t would, and Mr. McLoughlin i t would, have 212 Q JUDGE O'LEARY: W e l l . . . (INTERJECTION). MS. MACKEY: However, I mean you might 12 have known me for example 13 but you would not have thought that I would be able 14 to sort out t h i s for you. 15 JUDGE O'LEARY: 16 In other words there must have been - - you must have 17 known some connection in your mind between Stakelum 18 and the money; i s the question I think that i s 19 being asked? 20 A Well, how can I explain that? Mr. Stakelum 21 c e r t a i n l y - - we would never have di sc ussed the 22 fa c t that Mr. Traynor had that money with 23 Mr. Stakelum. 24 213 Q 25 A 26 214 Q 27 A Yes? While Mr. Traynor was a l i v e . Yes. So, did he know? Because in fa c t Mr. Traynor had asked us not to discus s i t with Mr. Stakelum. 28 29 MS. MACKEY: 215 Q Yes? 1 2 216 Q 3 A Yes ? Why I would have, we would have, di sc us sed i t with 4 Mr. Stakelum: 5 that i s because we knew him very well and I don't 6 know — 7 217 Q Well, the only thing I can say i s Can you r e c o l l e c t - - I mean you went along to 8 Mr. Stakelum at some stage and you would have had 9 to t e l l him that the money was there because he did 10 11 not know; i s that right? A 12 a f t e r Mr. Traynor died. 13 218 Q 14 A 15 219 Q 16 17 Yes? Exactly when i s what I don't remember. When does not matter r e a l l y . However, you would have t o l d him money was there? A 18 We would have t o l d him that Mr. Traynor had been given money. 19 220 Q 20 A 21 221 Q 22 A 23 24 I think we would have t o l d Mr. Stakelum about that Yes? But we di d n' t know where the money was. Yes? So, we couldn't t e l l him where i t - - that i t was there as such. 222 Q He must have then reassured you in some way that he 25 would be able to gain access to i t because here we 26 are in 1997 and he i s g e t t i n g i t for you? 27 A Well, I'm - - at that stage when we o r i g i n a l l y t o l d 28 Mr. Stakelum that the money had been given to - ­ 29 Mr. Stakelum di d n' t appear to know anything about 2 223 Q 3 A 4 224 Q 5 A Yes ? Now, I am tr yin g to think of t h e . . . (INTERJECTION). Sequence of events? The sequence of events as to how. Did we ask 6 Mr. Stakelum was there somebody that he could 7 contact ? 8 225 Q 9 A 10 226 Q 11 A 12 227 Q Yes? I simply ca n't remember the d e t a i l s . I see, a l l r ig h t . But t h i s was in 1997. That was 1997. Any way may be we can pass on from 13 that at the moment. 14 then, which i s the next page although in terms of 15 the sequence of time i t i s a c t u a l l y an e a r l i e r 16 trans ac tion; i t i s the month prior to th at. 17 you see that? 18 A 19 228 Q 17th January 1997? 20 A January 1997, yes. 21 229 Q I f you would look at page 106 Do Yes . It i s a s im ila r l e t t e r from Hamilton Ross to IIB 22 and t h i s time i t i s looking for a draft for £20,000 23 s t e r l i n g payable to Windsor Nutrition? 24 A 25 230 Q 26 A 27 231 Q 28 A 29 232 Q Yes . Do you r e c o l l e c t that as well? Yes . Again, was i t similar? I t was, yes. You went to Mr. Stakelum? 1 2 233 Q. 3 I see. JUDGE O'LEARY: 4 Mr. Stakelum and said, 5 6 When you went to "I want to ...(INTERJECTION)"? A. I think I might have telephoned him rather than 7 a c t u a l l y . . . (INTERJECTION). 8 JUDGE O'LEARY: 9 A ll r ig h t . How did you p h y s i c a l l y get the draft 10 in t o your hand ev entua ll y e i t h e r at that time or the 11 previous time? 12 A. I'm not sure that I a c t u a l l y got the draft int o my 13 hands. 14 JUDGE O'LEARY: 15 A. 16 17 I think i t was posted. To Windsor Nutr itio n in Northern Ireland and lodged. JUDGE O'LEARY: A. Right. By whom? I think Mr. Stakelum's sec r eta r y probably posted i t . 18 JUDGE O'LEARY: I see, I see. 19 MS. MACKEY: A ll r ig h t. 20 A. 21 I don't think I ever a c t u a l l y had those d r a f t s . JUDGE O'LEARY: 22 that; of the l e t t e r 23 24 25 Do you have a copy of accompanying that? A. No. JUDGE O'LEARY: Sure, there must be 26 something accompanying i t . 27 You do not ju s t open a l e t t e r in B e l f a s t or whatever 28 you are loca ted , somebody does not open i t , and see 29 a cheque or a draft for £25,000. 1 A. But I would have telephoned the g i r l in the o f f i c e 2 in the North. 3 JUDGE O'LEARY: 4 s l i p with i t or there must 5 6 be a l e t t e r with i t or something with i t . A. I'm not sure that there would have been. 7 post i t . 8 JUDGE O'LEARY: I know you did not but you were the r e c ip i e n t ; 10 your company was the r e c i p i e n t . A. Yes, but I would have telephoned the g i r l in my 12 company in Armagh. 13 JUDGE O'LEARY: 14 15 However, she must h a v e . . . (INTERJECTION). A. And t o l d her that there would the next day be a 16 bank draft for £20,200 or £25,000. 17 JUDGE O'LEARY: 18 19 I did n't I wouldn't have. . . ( INTERJECTION). 9 11 There must be a complement A. Yes. I t would ar rive in the post so she would know. JUDGE O'LEARY: 20 However, she must - - there must be something in with 21 it. 22 saying nobody, w i l l send out a draft for £25,000 23 in an envelope without some explanation as to where 24 i t i s coming from. 25 MS. MACKEY: Nobody - - w e ll, very few people, I am not 26 was an IIB complement s l i p 27 with i t . 28 JUDGE O'LEARY: 29 However, presumably there Or something. 1 2 3 I mean I can check with the o f f i c e . 4 JUDGE O'LEARY: 5 In the north of Ireland. 6 MS. MACKEY: Yes. 7 JUDGE O'LEARY: A ll r ig h t . 8 A 9 10 I f there i s anything on f i l e . JUDGE O'LEARY: A 11 Would you do that? That something accompanied.. . (INTERJECTION) JUDGE O'LEARY: 12 13 Would you check? That would be extremely helpful. 234 Q MS. MACKEY: 14 I f we could look now at page 175, which i s the 15 f i n a l one and again i t i s a c t u a l l y e a r l i e r in time? 16 I t i s the previous year and i t i s a si m ila r l e t t e r ; 17 do you see that? 18 A 19 235 Q Yes, that i s si m il a r to the £20,000. A si m ila r l e t t e r but t h i s time i t i s signed 20 by Mr. Collery. 21 Padraig Collery? 22 A 23 24 Page 175? Do you know Mr. Collery; I don't think I have ever - - I think I did. I met Mr. Collery once; the day Mr. Traynor died. 236 Q 25 Yes. However, did you have any dealings with him in connection with these funds? 26 A 27 237 Q No. Because here he i s making the arrangement, as you 28 can see. 29 he i s asking her to l e t him have a draft for £26,000 He i s writing to Paula Hartnett again and 1 s t e r l i n g payable to Windsor N ut ri ti on . 2 c ost to be debited to "Ansbacher" and he says: Again, the 3 4 "I w i l l c a l l to c o l l e c t the draft on Tuesday evening, ple as e leave at r e c e p t i o n ." 5 6 7 8 On that occasion Mr. Collery got the draft? A 9 10 b u t . . . (INTERJECTION). 238 Q 11 However, you do not know how you got i t from Mr. Collery? 12 A 13 239 Q 14 15 Yes, I can appreciate what you are saying No, no. He may have sent i t up, you think, to Northern Ireland? A No, I don't think Mr. Collery would have sent i t 16 to Northern Ireland. 17 f e e l i n g . . . (INTERJECTION). 18 240 Q 19 A 20 241 Q 21 A I have a Mr. Collery had i t p h ysi c ally ? Yes . So, he did something with i t ? Well, I'm not sure that he would have p h y s i c a l l y 22 sent i t , 23 Mr. Stakelum's sec retary who would have sent i t ? 24 242 Q I don't know, or did he give i t to Who would have sent i t , I see. Can we look at 25 another document? 26 (Same Handed), Exhibit 8. 27 e a r l i e r document but i t i s s im il a r . 28 Hamilton Ross and i t i s addressed to another 29 person in IIB and i t i s dated the 29th March 1993. Page 164 p le as e, Tom This i s again an I t i s from 1 2 3 "Could you pl e as e arrange to l e t us have for c o l l e c t i o n an I r i s h Pounds cheque for IR£10,000 payable to Merops (Nutrition) Limited and debit the S t e r l i n g cost to Hamilton Ross Account No. 02/01354/81." 4 5 6 7 8 Down at the very bottom in handwriting - - do you see 9 down in the right-hand corner? 10 A. 11 2 43 Q. Yes. It says: 12 13 "Cheque by hand to BMB at Merops." 14 15 Is that you? 16 A. 17 244 Q. 18 A. 19 245 Q. 20 A. 21 Yes, yes. Barbara Mary Breen; i s that right? Yes. This . . . (INTERJECTION)? I t - - that £10,000 I would have telephoned Mr. Traynor. 22 246 Q. 23 A. 24 247 Q. 25 Yes? And asked him to get me £10,000. Is t h i s the £10,000 you were t e l l i n g us about earlier? 26 A. 27 248 Q. 28 A. 29 249 Q. Yes. Which was the guarantee? Yes. Why i s i t payable to Merops rather than to yourself? A. 2 needed to pay i t back. 3 250 Q. 4 A. 5 251 Q. 6 I understand? Before the end of the f i n a n c i a l year. I see . However, e s s e n t i a l l y i t was money for yourself? 7 A. 8 252 Q. 9 A. 10 11 Because I would have owed that money to Merops and I Yes . To repay a debt? I t was lodged to Merops and i t would have paid my d e b t. 253 Q. 12 Yes. However, i t was your personal debt rather than the company's; i s that right? 13 A. 14 254 Q. 15 I t was my personal debt. I understand. You als o see down here, j u s t above the l i t t l e handwritten b i t ; do you see: 16 17 "DPC - Please debit A/A10." 18 19 A. 20 255 Q. 21 A. 22 256 Q. 23 A. 24 257 Q. 25 26 Yes . Are you fa m ili ar with the code "A/A10"? I am now, yes. You are now? Yes . Do you accept that that r e l a t e s to the de pos its s e t aside by Mr. McLoughlin for you? A. 27 I t appears to be from the information which was given to me. 28 258 Q. 29 A. You sent us i n . . . ( INTERJECTION)? 1 259 Q. 2 A. 3 260 Q. 4 A. 5 261 Q. 6 A. 8 262 Q. 10 Yes. "Ansbacher" and Hamilton Ross statements of those? Which were given to me by the Tribunal. By the Moriarty Tribunal, yes. F in al ly , could we look at page 168 (Same Handed), Exhibit 9? 7 9 Or your s o l i c i t o r sent us in a number of statements? Thank you. Again, t h i s i s a l e t t e r from Hamilton Ross to IIB and i t i s dated 5th March 1993. d i f f e r e n t to the others. This i s s l i g h t l y It says: 11 12 13 "Dear Ronan, AIB in Jersey have been requested to tr a n s fe r an amount of S t g .£89,185.39 to Royal Bank of Scotland for c r e d it to your Acco un t..." 14 15 16 That i s the account of IIB in the Royal Bank of 17 Scotland, 18 19 " .. .a n d onward c re d it to Hamilton Ross Account no. 0 2 /0 1 3 5 4 /8 1 .. ." 20 21 22 That i s the Hamilton Ross account in IIB that the 23 withdrawals we have been looking at have come from. 24 25 "In due course perhaps you could confirm the r e c e ip t of t h i s tr a n s fe r ." 26 27 28 Then down at the bottom we have again a l i t t l e note 29 to DPC, who i s Mr. Padraig Collery: 1 2 3 4 Can you throw any light on that transaction? 5 Absolutely no idea. 6 263 Q 7 A 8 264 Q 9 A 10 265 Q None at all? No. Mr. McLoughlin was still alive at that stage? Yes . Then it appears to be a transfer from Allied Irish 11 Banks in Jersey to his or yours or both of yours 12 account in "Ansbacher" or does that not seem to 13 be the case? 14 A 15 2 66 Q 16 That's what it appears to be but -­ Do you personally or did you personally have an account in AIB in Jersey? 17 A No. 18 267 Q No? 19 A No. 20 268 Q 21 A 22 269 Q 23 A 24 270 Q 25 A 26 271 Q Do you know if Mr. McLoughlin had? No, he didn't. He did not? No. I see. What about either Merops or Windsor? No, it didn't. Are you sure Mr. McLoughlin did not? I mean is it 27 possible he had? 28 Well, I can be as certain I think as anybody because 29 I would have handled all his transactions. 1 272 Q 2 I see. You do see that here we have a transfer from AIB in Jersey into your funds? 3 A 4 273 Q 5 A 6 274 Q Yes . And you can throw no light on that? No. I see. Any way just to recap then, Ms. Breen, 7 because I do not think I have any more questions 8 for you after this, and just to try again to be 9 clear about the ownership of these funds: Your 10 understanding of it is that Mr. McLoughlin put 11 them there for his and your use; is that correct? 12 Did he draw on them during his lifetime? 13 A 14 (indicating). 15 275 Q 16 A 17 276 Q 18 A The Windsor ones? These Windsor ones. Yes ? But other than that he wouldn't have drawn. I did that (indicating). 19 20 Well, he would have drawn these amounts 277 Q 21 You were able to draw on it for the particular thing...(INTERJECTION)? 22 A 23 278 Q 24 A 25 279 Q 26 A That £10,000 was...(INTERJECTION). Did you draw on it for any other? No, no. You do not recollect? There were these three sterling ones (indicating). 27 No, I don't think there was anything I withdrew 28 for anything else. 29 280 Q 1 A. 2 that money back. 3 281 Q. 4 A. 5 282 Q. 6 A. 7 283 Q. 8 A. 9 284 Q. 10 A. 11 285 Q. 12 13 Yes? When he realized where the money was. Yes? He brought that money back. I see? To Ireland. Right? And lodged it with Anglo Irish. I see. So, in fact it had at that stage been brought back? A. 14 15 Well, the money was -- Mr. McLoughlin had brought That was I think brought back about two years ago. I can't remember exactly the details. 286 Q. 16 Mr. McLoughlin's death was just last year; is that not right? 17 A. 18 287 Q. 19 A. 20 288 Q. January 2000. Yes? So, 1999. I think it was probably 1998. You were aware from 1980 that this fund was there. 21 You were aware that in an emergency you could use 22 it? 23 A. 24 289 Q. 25 However, you felt that in order to use it you had to notify Mr. McLoughlin first or ask him? 26 A. 27 290 Q. 28 A. 29 I -- yes. Yes. Or at least make him aware of it? Certainly, yes, I would have discussed it. 1 2 3 292 Q. However, having discussed it with him you then went 4 to Mr. Traynor or as the case might be Mr. Stakelum. 5 It was you rather than Mr. McLoughlin who went; is 6 that right? 7 A. 8 Yes, because I would have dealt with all the financial aspects. 9 293 Q. 10 A. 11 294 Q. Yes, yes? Mr. McLoughlin wasn't very good at keeping -­ Right, right. On the occasions when you went to 12 Mr. Traynor himself, prior to Mr. Stakelum taking 13 over, would you just say to him that you needed 14 X amount of funds? 15 A. 16 295 Q. 17 A. 18 296 Q. 19 A. 20 297 Q. 21 A. 22 298 Q. 23 A. 24 299 Q. 25 A. 26 300 Q. 27 Well, I think the only time I clearly can remember. Yes? And I think that was the only occasion. Yes? Was the £10,000. Right? And I would have I think may be just telephoned him. Yes? Or saw him in the house. I mean I...(INTERJECTION). Yes, and he would tell you that he could arrange it? Yes. And in due course the cheque or whatever would arrive ? 28 A. 29 301 Q. Yes. I see. I have no further questions, Ms. Breen. 1 2 Thank you very much. 3 Judge O'Leary may have some. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF EXAMINATION OF MS. BREEN BY MS. MACKEY. 1 2 3 4 303 Q. JUDGE O'LEARY: Yes. 5 Who owns the companies that got 6 the money; on page 175 for example, Exhibit 7? 7 A. 8 304 Q. Nutrition Limited? 9 A. Windsor Nutrition. 10 305 Q. 11 A. 12 Windsor? Yes? Well, Mr. McLoughlin was the majority shareholder up to his death in Windsor Nutrition. 13 306 Q. 14 A. 15 307 Q. 16 A. 17 308 Q. 18 A. 19 What percentage did he hold; do you remember? 99 and I had one. You had one? Yes. Who owns it now? Well, his -- its divided between his two daughters and myself. 20 309 Q. 21 A. 22 310 Q. 23 A. 24 311 Q. Yes. What percentage do you each have? One third each of it. One third each. All right, grand? One third each of Windsor Nutrition. That is just number one. This fund originally 25 started at something over £300,000; is that not 26 correct? 27 A. 28 312 Q. 29 I think it was, yes. £380,000? 1 313 Q. 2 A. 3 314 Q. I am not really interested in the numbers? Yes, yes, it was about that. I try to avoid numbers if I can but just to give 4 some idea of it. 5 over the years? 6 A. 7 315 Q. 8 Obviously, it earned interest Yes. And obviously payments were made out of it just like we have mentioned here including the £ 1 0 ,000 ? 9 A. 10 316 Q. 11 Yes. So, by the time it came back in 1988 or whatever the appropriate...(INTERJECTION)? 12 A. 1998 . 13 Q. 1998? 14 A. Yes. 15 Q. 1998 or 1999, whatever the appropriate year 16 A. Yes . 17 Q. It still was a substantial amount of money? 18 A. Yes, although I remember Mr. McLoughlin I think it was 1998, yes. saying...(INTERJECTION). 19 20 320 Q. 21 A. 22 Yes? That if the money had been put into a building society loan. 23 321 Q. 24 A. 25 322 Q. 26 A. 27 323 Q. 28 A. 29 324 Q. Yes, it would have been better off, I understand? And everything handled by himself or by me. Yes? Or whatever. Yes? That the fund would have been an awful lot more. All right? 1 I know that that was something he felt very 2 strongly about. 3 What happened that money eventually? 4 say -- it went -- eventually you say it went into 5 Anglo Irish. 6 Islands? 7 A 8 326 Q 9 A 10 327 Q 11 12 Did any of it go to the Channel No. No, all right. So, it went into Anglo Irish? Yes . Who owned that money eventually? Who owns it today shall we say for example? A 13 Well, when everything -- Mr. McLoughlin would have spent some of it. 14 328 Q 15 A 16 329 Q 17 A 18 19 Who shall we I understand? You know on various expenses. Yes ? But the residue of Mr. McLoughlin's Will all comes to me . 330 Q 20 Yes. Ultimately it made its way to you less whatever amount had been spent in the meantime? 21 A Yes . 22 331 Q Yes . 23 MS. CORRIGAN: Just to clarify? 24 JUDGE O'LEARY: Yes . 25 MS. CORRIGAN: It went back into 26 an account in 27 Tom McLoughlin's name. 28 Yes, yes. 29 1 2 3 MS. MACKEY: I see, that is helpful. 4 MS. CORRIGAN: Yes . 5 It is not -- sorry. 6 MS. CORRIGAN: 7 8 Sorry, just to clarify a point. 332 Q JUDGE O'LEARY: 9 Yes. When it was brought back it was brought back 10 in his name? 11 A 12 333 Q 13 A 14 334 Q Yes . Not in your name? No. I see. Ultimately you acquired ownership of it 15 again or re-acquired ownership of it again as the 16 residual legatee on his death? 17 MS. CORRIGAN: Well...(INTERJECTION)? JUDGE O'LEARY: Would that be a 18 335 Q fair summary of the 19 20 position? 21 A 22 336 Q 23 Yes . I see. MS. CORRIGAN: 24 Sorry, again just to mention that the Estate 25 is not fully administered yet. 26 Yes . 27 MS. MACKEY: All right. 28 So, in fact the Executors 29 still have control of that 1 2 3 JUDGE O'LEARY: I see, yes. 4 MS. MACKEY: So, in fact that fund, the 5 fund that had been out to 6 Cayman, formed part of Mr. McLoughlin's Estate in 7 due course? 8 MS. CORRIGAN: Yes, it did, yes. 9 MS. MACKEY: I see. MS. CORRIGAN: May be -- would you mind 10 11 if I comment 12 on...(INTERJECTION)? 13 JUDGE O'LEARY: 14 questions now first. 15 16 I might have a few more 337 Q. MS. CORRIGAN: Yes, Okay. JUDGE O'LEARY: Yes, thank you. 17 Sorry. I wonder would you show this kind 18 lady number 57; page number 57 (Same Handed), 19 Exhibit 10? 20 Mr. Traynor died and before Mr. McLoughlin died in 21 which there were substantial disbursements to 22 Windsor Foods, Windsor Nutrition and Merops We are going back now to a time before 23 (Nutrition). 24 Director of the company receiving those monies 25 (indicating)? 26 A. 27 338 Q. 28 29 Do you remember as the Financial Yes. They are in addition to the monies which were put 1 339 Q. 2 3 So, that is another substantial tranche of money. A. 4 5 Yes. How was that received? That was received in a sterling -- I can't remember if these were cheques or drafts. 340 Q. 6 Yes. I think ...(INTERJECTION). MS. MACKEY: 7 A. 8 341 Q. I think they were drafts. I don't know if that matters. JUDGE O'LEARY: It says: 9 10 "Please debit the cost of all four Drafts ..." 11 12 13 A. 14 342 Q. 15 Yes. Well... (INTERJECTION) . I am not really concerned whether they were cheques or drafts any way? 16 A. 17 343 Q. 18 A. 19 344 Q. 20 A. 21 Sorry. It does not make any difference to me? Yes . However, how did you arrange that? I spoke to Mr. Traynor about these four (indicating). 22 345 Q. 23 A. Yes? It was for those amounts (indicating) and it was 24 at a time when the companies were in financial 25 difficulties. 26 346 Q. 27 A. 28 347 Q. 29 Yes, I understand that? And...(INTERJECTION). And I am not concerned with that aspect of the matter. 1 2 348 Q 3 A That is of no interest? Mr. McLoughlin needed, or we needed, to put some 4 injection of funds into the companies and the reason 5 why they were done in those amounts is I think: The 6 £2,000 loan, Irish, was probably a loan may 7 be Mr. McLoughlin had with Merops. 8 349 Q 9 A Yes? So, that would have gone back to pay that loan. The 10 £34,000: 11 sold a number of products to France which tins had 12 exploded and there was a claim from the customer and 13 we eventually thought it would be sorted out and it 14 wasn't and because as I said the companies were in 15 financial difficulties I was terrified to either 16 tell the banks or the auditors that we were going 17 to have an additional £34,000 loss on that. 18 would have spoken to Mr. Traynor in relation to 19 these amounts 20 them to me. 21 350 Q 22 23 (indicating). We had So, I He would have given How would they have been dealt with in the company's accounts? A 24 The £34,000 would have paid the claim. We had an outstanding claim. 25 351 Q 26 A 27 352 Q 28 A 29 Yes. That was in relation to the claim. I understand that? From a customer. Somebody in France? Yes. So, that amount of the £34,000 would have gone in against that. 1 353 Q. I understand that and you can take it that I 2 appreciate that and of course I accept entirely 3 what you say. 4 that I am asking? 5 A. 6 354 Q. That is not the question however Sorry, I am misunderstanding. Yes. The question I am asking is: When a company 7 receives £34,000 from an outside source it has to 8 receive it as a loan or as capital or it has to 9 receive it -- it has to appear in the balance sheet 10 11 under some guise? A. 12 355 Q. 14 A. 15 356 Q. 16 A. 17 357 Q. 18 To Mr. McLoughlin? Yes, yes. And would it have...(INTERJECTION)? Because it was -- he was putting the money in. Would that have been shown as being owed to Mr. McLoughlin? A. 20 21 That would then have been owed to Mr. McLoughlin. 13 19 It would have been a loan. It would have formed part of a Director's loan account. 358 Q. Yes. If I was to look at the accounts of Windsor 22 Foods Limited would I see that in the following year 23 as being an outstanding loan? 24 A. 25 359 Q. 26 A. 27 360 Q. Yes, you -- yes, it would have. Yes? It would have been lodged. Yes, I see. Thank you very much. When you asked 28 Mr. Traynor for that money where did you think that 29 the money was coming from? 1 2 3 361 Q 4 will...(INTERJECTION)? 5 A 6 362 Q 7 8 Any one of them if you like but we The money which Mr....(INTERJECTION). As we have this one open in front of us we might as well take this one? A 9 But Mr. McLoughlin had given Mr. Traynor money and as this in my view was a very rainy day or a 10 serious situation I had said to Mr. McLoughlin 11 that I was going to ask Mr. Traynor for some 12 money because the company was in...(INTERJECTION). 13 363 Q 14 A 15 364 Q Yes, I understand that? Dire straights. Yes, I understand that. I am sure it was a very 16 wise decision. 17 all. 18 Mr. Traynor was not a man who kept the money in his 19 own back pocket. 20 had the money somewhere. 21 money was coming from? 22 A I am not have criticising that at We seem to be at cross purposes. However, You obviously must have thought he Where did you think the To be quite truthful with you I didn't really. 23 Mr. Traynor was a banker and he had the money. 24 I didn't have no -- he had told Mr. -- I didn't 25 really think. 26 really worked out where the money was. 27 had it and he could arrange to get this money for 28 me . 29 Yes. If I am being very honest I never Mr. Traynor However, you knew it was not in the Rathmines 59 1 2 3 4 I didn't think of the Allied Irish Bank. 3 66 Q I am only talking about -- you did not think it was 5 deposited in some Allied Irish locally or Bank of 6 Ireland because if it was there would have been 7 tax implications with regard to the interest? 8 A 9 I truthfully never thought where this money was. Mr. McLoughlin had given this money. I only heard 10 about this after the event and Mr. Traynor -- more 11 or less I suppose I thought when I -- when there 12 were -- when these kind of financial problems arose 13 I asked Mr. Traynor for the money. 14 367 Q Yes, I understand that. However, the question is: 15 Where did you think he was getting the money from; 16 that is the question I am asking you? 17 you think Mr. Traynor had this money on deposit 18 that he could give you access to it? 19 Guinness & Mahon? 20 shore company or where was it; did you think? 21 A 22 Where did Was it in Was it in some unknown off I don't -- I honestly can't say where I -- I didn't think about i t . 23 368 Q 24 A Mr. Traynor was handling money for lots of people. 25 369 Q Did you think that as a Financial -- as a Director I mean did you think as a . ..(INTERJECTION)? 26 of the company and as a potential beneficiary, 27 will not put it any stronger than that, of the funds 28 did you think that it was possible that interest was 29 being earned on the money? I You must have thought 1 2 I suppose I must have at some level. 3 370 Q 4 A 5 371 Q 6 Yes ? But it wasn't something. At some level. MR. LEYDEN: Sorry, with respect, I 7 think it might be more 8 helpful if the witness were asked what she actually 9 knew; that that might help you in terms of, you 10 11 know, the facts that you are trying to establish. 372 Q JUDGE O'LEARY: Yes. 12 I will ask the questions the way I want 13 to ask them myself. Ms. Breen, the question I am 14 asking you is this: You described yourself as the 15 Financial Director of a company and I am sure as a 16 Financial Director of a company you know that if 17 money is available -- if you have -- if you owe 18 people money you pay interest on it and if you have 19 money on deposit normally you get interest on it? 20 A 21 373 Q 22 Yes, yes. However, that does not inevitably apply nowadays. However, in those days it certainly applied? 23 A 24 374 Q 25 A Yes . And you agree with that? I do but what I am trying -- what I would like to 26 point out to you in relation to this money is that 27 this wasn't money that I actually thought of in 28 real terms. 29 myself badly. If I may put it to you I am expressing This was money which if it were to 1 be mine as it were it was going to be under very 2 bad circumstances; Mr. McLoughlin was going to be 3 dead or the company was going to be bankrupt or in 4 some serious difficulty. 5 375 Q 6 A Yes, I understand that, yes? I never actually factored that money into any area 7 of the business until this point in 1991 when we 8 were in serious difficulties. 9 taken an oath -- I will have to say to you that I 10 11 I would and I have never thought about that money. 376 Q You see the question I am really putting to you is: 12 As I understand it from your evidence you had a lot 13 to do with the personal financial affairs of 14 Mr. McLoughlin? 15 A 16 377 Q 17 I did, yes. Yes, all right. Taking if you like your personal interest out of it for the moment? 18 A 19 378 Q 20 A 21 379 Q 22 A 23 380 Q Yes . And leaving that to one side? Yes . Forget that? Yes . We will say that it was only a remote interest. 24 However, you know that Mr. McLoughlin had put money 25 approaching £400,000 somewhere? 26 A 27 381 Q Yes . That it was earning interest somewhere and that 28 returns should be made to the Revenue Commissioners 29 in respect of that interest. Now, I am not 1 2 No, no. 3 382 Q 4 A 5 I am not concerned...(INTERJECTION)? But what I am trying to say to you is that...(INTERJECTION). 6 383 Q 7 A 8 I just want to know what was in your mind? That in the same terms as I have said to you that I never thought about this money. 9 384 Q 10 A Yes ? Or factored it into the -- Mr. McLoughlin equally 11 wouldn't have. 12 you. 13 Mr. McLoughlin for this money on by behalf. 14 385 Q 15 A It's very difficult to explain to Mr. Traynor was the one who asked Yes? Mr. McLoughlin didn't go to Mr. Traynor and say, 16 "I have this money. 17 It was Mr. Traynor who asked Mr. McLoughlin for 18 this money in order to take -- to look after me 19 if something happened to him or whatever. 20 I don't know i f ...(INTERJECTION). 21 MS. CORRIGAN: No, no, that is fine. JUDGE O'LEARY: Thank you very much. 22 386 Q Please do something with it." 23 Sorry, There is just one other 24 question that I want to ask you. 25 show the lady number 45 (Same Handed), Exhibit 11? 26 Page 45 is a Windsor Nutrition Limited document. 27 This is a document in Guinness & Mahon and it is to 28 do with Windsor Nutrition. 29 with you personally at all. I wonder would you It has nothing to do However, as you are 1 here and as you are a Director to the company I am 2 going to ask you a question about it; that is all? 3 Yes . 4 Apparently Windsor Nutrition Limited, which was a 5 pet food manufacturer which you had a connection 6 with, was borrowing money from Guinness & Mahon and 7 this I think is about 1987. 8 one of a number of similar ones. 9 up on the 1987 aspect of it? 10 A 11 388 Q 12 A 13 389 Q 14 A 15 390 Q However, this is only Do not be hung Right. It could be one of a number? Okay. I am just using one as an example? Yes . You can see in fact that it is a review which 16 means that there was an existing loan which they 17 were holding over or something. 18 £ 1 0 0 ,000 ? 19 A 20 391 Q 21 Yes . Did Windsor Nutrition Limited have in the 1980's a borrowing with Guinness & Mahon? 22 A 23 392 Q 24 A 25 No. I see . Windsor -- the reason why I am looking at this is because the Tribunal. 26 393 Q 27 A Yes? Gave Mr. McLoughlin -- it is not exactly the same document. 28 29 It was for 394 Q Yes? 1 But it had something to do with a £100,000 2 guarantee. 3 395 Q 4 I can give you five other documents to do with the same thing? 5 A 6 396 Q 7 A Exactly, yes. They are almost the same? In -- it must have been 1987. 8 later quite truthfully. 9 1989. 10 397 Q 11 A I thought it was I thought it was 1988 or Yes ? Windsor Nutrition was the company which had the 12 largest bank account. 13 Nutrition had an account with Northern Bank. 14 398 Q 15 A In other words Windsor Yes? Whereas Merops (Nutrition) in Dublin would have had 16 a smaller account and Windsor Foods would have had a 17 smaller account. 18 moving the factory from the north of Ireland down 19 to the south of Ireland. 20 3 99 Q 21 A 22 Windsor Nutrition was -- we were Yes? And were obviously going to adjust bank, various bank, arrangements. 23 400 Q 24 A Yes ? We had had some difficulties with Northern Bank 25 over the years; that the overdrafts went up beyond 26 the agreed facilities or whatever. 27 401 Q 28 A 29 Yes? I can't remember the exact details but Mr. Traynor said that Guinness & Mahon...(INTERJECTION). 1 402 Q. 2 A. 3 403 Q. 4 A. 5 6 Yes? Would guarantee £100,000 to the Northern Bank. Yes? In other words we had a loan, I can't remember again the details, with Northern Bank. 404 Q. If you actually -- if you read the document? I gave 7 you that document particularly because it gives all 8 that information. If you read there it says: 9 10 "We have been requested..." 11 12 "We" now being Guinness & Mahon? 13 A. 14 405 Q. Yes. 15 16 "...to provide the above guarantee..." 17 18 Which is £100,000? 19 A. 20 406 Q. Yes. 21 22 23 24 25 "...in respect of a facility being made available to the company by Northern Bank Limited. The facility is for £350,000 however the guarantee states that we shall not be liable for the fist Stg £250,000. We hold funds Stg £180,000 "Blocked" to cover the guarantee." 26 27 28 29 means. 1 407 Q 2 Obviously some funds which were either owned by Windsor Nutrition, which you tell me is unlikely? 3 A 4 408 Q Yes . Or which were owned by one or the Directors or 5 shareholders of it were being used to back the 6 £ 100,000 and do you know which? 7 A 8 409 Q I don't . However, some funds were been used to back the £ 1 0 0 ,000 ? 9 10 I don't . A 11 Would this have been the fund which Mr. Traynor had; is that...(INTERJECTION)? 12 410 Q 13 A 14 411 Q 15 A May be? Is that it? May be, yes. No. Do you know anything about that? I mean that is the only thing; that was 16 Mr. Traynor giving this guarantee on the basis that 17 Guinness -- that he had funds that he would take. 18 I don't know but Windsor Nutrition wouldn't be 19 the...(INTERJECTION). 20 412 Q Yes, I understand what you say about that. However, 21 obviously some entity, and if you tell me it is 22 not Windsor Nutrition of course I accept that, 23 other than Windsor Nutrition was willing to give 24 a £ 100,000 guarantee to the company from funds 25 placed in some way off shore with Guinness & Mahon 26 because that is what adequately secured means. 27 you know who was giving that guarantee? 28 29 A Do I don't. You do not. Fair enough. 67 That is fine. That is 1 grand. 2 Thank you very much. Thank you very much indeed, Ms. Breen. 3 4 END OF EXAMINATION OF MS. BREEN BY JUDGE O'LEARY. 5 6 7 MS. MACKEY: Thank you, Ms. Breen. 8 We have not got any further 9 questions to ask you. If you would like to have a 10 cup of tea or coffee one is provided. 11 than welcome to have one before you leave. You are more 12 13 The only other thing we have to ask you to do is: 14 In due course the transcript will be typed up and 15 we do need to ask you to come back to sign it but 16 our solicitor will be in touch with you or your 17 solicitor to make an arrangement for you to come 18 and read it and sign it if you agree with it at your 19 convenience. 20 21 A. Yes. Excuse me? MS. CORRIGAN: 22 Was there something? Yes. I just wondered if -- I just had a few pieces 23 of information to volunteer. 24 JUDGE O'LEARY: Yes. 25 MS. CORRIGAN: You may find it helpful. 26 JUDGE O'LEARY: Certainly, certainly. 27 MS. CORRIGAN: Because Mr. McLoughlin did 28 29 discuss this issue with me in his lifetime and it might help to clarify one or 1 two of the questions that you asked Ms. Breen; that 2 certainly, you know, Tom would have said -- given 3 information to me at meetings. 4 JUDGE O'LEARY: Yes. 5 MS. CORRIGAN: And just very briefly the 6 background was as Barbara 7 mentioned. 8 He didn't know Des Traynor at all well. 9 grew up next door to the Traynors or two doors down. It was Des Traynor who approached him. Barbara 10 Mrs. Traynor baby-sat her as a child and knew her 11 very well. 12 company and became a close personal friend with 13 Mr. McLoughlin. Then Barbara started to work in the 14 15 Mr. McLoughlin had sold some shares in the early 16 1980's for a substantial sum of money and had used 17 the stock broking services of Guinness & Mahon to 18 do that. 19 20 He then shortly afterwards received an approach 21 from Des Traynor who rang him and asked him to meet 22 him in the Shelbourne Hotel, which he went and did, 23 and Mr. Traynor said that effectively on behalf -­ 24 almost like as if in loco parentis. 25 JUDGE O'LEARY: Yes. 26 MS. CORRIGAN: He was asking for a fund 27 to be set aside for 28 Barbara because she had no pension and she had been 29 working in the company for 16 years. 1 2 wrote to us and you set 3 out all of this in the letter. 4 MS. CORRIGAN: 5 6 think...(INTERJECTION). JUDGE O'LEARY: 7 8 Yes, but I And we have taken it...(INTERJECTION). MS. CORRIGAN: 9 I think just in terms of the questions that you 10 asked about tax: 11 to Des Traynor either had capital gains tax paid on 12 it or it was exempt ESR funds. 13 MS. MACKEY: Yes. 14 MS. CORRIGAN: So, the funds that he gave 15 The fund that Mr. McLoughlin gave him: There was no question 16 that tax had not been properly accounted for on the 17 funds. 18 MS. MACKEY: We understand that. 19 MS. CORRIGAN: Yes. 20 MS. MACKEY: No, I think 21 Judge O'Leary's 22 question was in relation to the interest. 23 MS. CORRIGAN: 24 In relation to the interest: 25 Tom McLoughlin's understanding was that Des Traynor, 26 being an accountant, would be looking after properly 27 all of the issues to do with any interest that was 28 earned on it. 29 1 2 3 effectively a Trustee. JUDGE O'LEARY: 4 How could that be the case? Sure, Mr. Traynor 5 could not make a financial return for 6 Mr. McLoughlin. 7 MS. CORRIGAN: Well, as a Trustee. 8 JUDGE O'LEARY: No, he could not 9 10 make...(INTERJECTION). MS. CORRIGAN: 11 12 He would be responsible as a Trustee. JUDGE O'LEARY: 13 He could not make the annual returns for and on 14 behalf of Mr. McLoughlin. 15 JUDGE O'LEARY: I would have to disagree, 16 Judge O'Leary, that as a 17 Trustee if you have a sum of money -- if I have -­ 18 if someone gives me a sum of money and as a Trustee 19 I invest it and I receive interest on it it is my 20 obligation under the Tax Acts to make a return of 21 interest. 22 MS. MACKEY: 23 from Mr. McLoughlin that a 24 Trust was constituted? 25 MS. CORRIGAN: 26 Well, that was -- although there was no formal 27 documentation. 28 MS. MACKEY: 29 Is it your understanding Yes . 1 understood it and how I 2 understood it from speaking to Mr. McLoughlin was 3 that, as Barbara described it, it was effectively 4 a fund that, in my understanding, belonged to 5 Mr. McLoughlin unless something -- unless he died. 6 MS. MACKEY: Yes . 7 MS. CORRIGAN: In which case Barbara was 8 9 10 to have the benefit of it...(INTERJECTION). JUDGE O'LEARY: 11 The one thing we know for absolute certainty is that 12 Mr. Traynor exercised no control over the fund. 13 MS. CORRIGAN: Well...(INTERJECTION). 14 JUDGE O'LEARY: He paid out when he was 15 16 asked to pay out. MS. CORRIGAN: 17 18 I ...(INTERJECTION). JUDGE O'LEARY: 19 20 I -- he -- I have heard enough thank you. MR. LEYDEN: 21 Thank you. We are merely trying to be helpful to you. 22 JUDGE O'LEARY: Yes . 23 MR. LEYDEN: I mean if we give you the 24 information you can make 25 of it what you will. 26 JUDGE O'LEARY: Yes . 27 MR. LEYDEN: However, if you are not 28 29 receptive that is fine. 1 2 3 I just... (INTERJECTION) . 4 JUDGE O'LEARY: 5 And we are -- this question of giving us 6 unsworn testimony...(INTERJECTION). 7 MS. CORRIGAN: 8 I am quite happy to...(INTERJECTION). 9 JUDGE O'LEARY: If you want to give -- if 10 you want to be called to 11 give evidence we will do that in due course but we 12 will do it in a formal way and not in this kind of 13 ad hoc way. 14 MR. LEYDEN: 15 Clearly it is a matter for yourselves. 16 trying to be helpful; that is all. 17 MS. MACKEY: 18 Thank you. 20 MS. CORRIGAN: 21 23 24 No, we appreciate that. Thank you very much. 19 22 Okay. That is fine. Thank you. A. Thank you. JUDGE O'LEARY: Thank you very much indeed. 25 26 27 28 29 We are merely THE EXAMINATION WAS THEN CONCLUDED Thank you. Kwa- NW can; Cummist Ckcik-p 5" 0\ Appendix XV (170) Mr Francis Boland 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Francis Boland. a) Transcript of evidence of M r Francis Boland dated 15 M a y 2000. b) Letter of 22 March 2000 from O ’Flynn, Exhams & Partners to Inspectors. c) The Lynbrette Trust Deed. Correspondence written on behalf of M r Francis Boland. a) Letter of 20 August 2001 from O ’Flynn, Exhams & Partners to Inspectors. UNDER OATH ON MONDAY, 15TH MAY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. FRANCIS J. BOLAND Represented by: MR. FRANK 0'FLYNN 0'FLYNN EXHAMS & PARTNERS SOLICITORS 5 8 SOUTH MALL CORK WITNESS MR. F. BOLAND I EXAMINATION MR. JUSTICE COSTELLO MS. MACKEY MR. JUSTICE COSTELLO 35 47 PAGE 34 46 54 1 2 3 4 MR. JUSTICE COSTELLO: Good morning Mr. Boland. 5 MR. BOLAND: Morning. 6 MR. JUSTICE COSTELLO: Sorry for being a bit late 7 starting. 8 MR. BOLAND: Okay Chairman, Okay. 9 MR. JUSTICE COSTELLO: My name is Declan Costello 10 and on my right is 11 Ms. Mackey. 12 Inspectors by The High Court to investigate the 13 affairs of the company. We have been, as you know, appointed 14 15 I should explain to you, as we do to other persons 16 whom we ask to come for interview, that this is not 17 a Court. It is not a Tribunal. It is an interview. 18 19 If in the course of the questioning by me or by 20 Ms. Mackey you would like to take advice from your 21 solicitor please tell us so and we will stop asking 22 the questions. 23 24 Similarly, if Mr. O'Flynn thinks that he would like 25 to advise you in relation to any questions that we 26 ask, he can indicate that to us and we will stop and 27 he can then discuss the questions with you. 28 29 wi11 ask now Ms. oath to you. Cummins how to administer the 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Boland could we begin by your recounting to us, 6 just briefly, your business experience and your 7 background in business? 8 A. 9 Well, its a long story Chairman. worked for anybody in my life. I have never I started in 10 business going to school and eventually set up my 11 own business -- set up as a sole trader. 12 in the car and motor business and the parts business 13 and went into the rent-a-van business which 14 was...(INTERJECTION). 15 2 Q. 16 A. 17 3 Q. 18 A. 19 The what? The rent-a-van business. Yes? Which was probably the most public looking one of my enterprises that I was in. 20 4 Q. 21 A. Yes? Machinery business and I had a lot of involvements 22 all over. 23 Dublin. 24 North of Ireland. 25 5 Q. 26 A. 27 6 Q. 28 A. 29 I set up I had at one stage five operations in I had an operation in Randlestown in the Yes? I had a business in Manchester. Yes? I had a place in Limerick and I was in a myriad of other businesses and so on and so forth. I was one 1 2 7 Q 3 A 4 8 Q 5 A 6 9 Q 7 A 8 Of? Cork Communications in Cork. Yes ? And in Ivernia Exploration. Yes? And I was at one stage a Director of Beamish & Crawfords. 9 10 Q 10 A Yes ? And over the years then I served in many State 11 bodies. 12 Chairman of B&I. 13 11 Q 14 A 15 12 Q 16 A 17 18 I served on Aer Lingus and B&I. I was Yes? And Chairman of AerRianta. Yes? And I am presently Chairman of The Port Of Cork Company. 13 Q Yes. Thank you Mr. Boland. What I propose doing is 19 asking you some questions about the Lynbrett Trust 20 first? 21 A 22 14 Q Yes . The people that were involved with you in the 23 establishment of the Lynbrett Trust were, I think, 24 personal friends of yours, is that right? 25 A 26 15 Q That is correct. Yes. Would you tell me how you became involved in 27 it? 28 I just can recount, I think, that some deal came up 29 at some stage, you know, that there was an 1 2 16 Q 3 A 5 17 Q 6 In Yes . In great detail I want you to tell me who talked to you first? 7 A 8 18 Q 9 A 10 19 Q 11 A 12 20 Q 13 A 14 I couldn't honestly answer you Chairman. Which do you think? Who do you think? I would say it was probably Collins, Neil Collins. Mr. Collins? I would say but I couldn't swear to it Chairman. Yes. What did he tell you? Well, that -- just like that. I can't fully recollect what he told me. 15 21 Q 16 A 17 No, of course, not the details but generally? Generally that there was an opportunity to invest in a real estate deal. 22 Q 19 20 Mr. Boland, not as general as that. great detail now? 4 18 No, no. Tell me more about it? What was the opportunity and what was the deal? A The deal was that there was an operation in the 21 States, or a number of investors in the States, who 22 were interested. 23 23 Q 24 A In what? In an RV Park, it was known as. We would call them 25 caravan parks but this is a more sophisticated type 26 of operation. 27 24 Q 28 A 29 Yes? And that there was an opportunity. They were looking for overseas investors to join with them. 25 Q. 2 A. 3 In promoting this idea and developing these RV Parks. 4 26 Q. 5 A. 6 Yes? And it went on from there Chairman. 27 Q. 8 A. 9 28 Q. 10 A. 11 29 Q. 12 A. 13 30 Q. 14 A. 15 31 Q. 16 A. 17 32 Q. 18 A. 19 33 Q. 20 A. 21 Where was the park? The park was in Arizona. Yes? In a place called Apache Junction. Yes? So, Apache was the operative word...(INTERJECTION). A suitable name for it? A suitable name. Yes? A very suitable name for it. Yes. Continue Mr. Boland? And the deal was put together. By whom? By -- I would say by Collins -- by -- we must have all agreed to partake in it. 34 Q. 23 Not, "we must have all". What was agreed Mr. Boland and who agreed and where and when? 24 A. 25 35 Q. 26 A. With Collins. 27 3 6 Q. And who else? 28 A. 29 It is...(INTERJECTION). 7 22 Yes? Well, I agreed. With who? And with Coveney. I understand...(INTERJECTION). 1 2 38 Q 3 A 4 39 Q 5 A 6 Mr. Love? And with Mr. Dineen. Yes. Did you meet the American people involved? I did meet -- there was one of the American people who was quite well known to me. 7 40 Q 8 A 9 41 Q 10 A Who was that? M r . Cummins. Yes. Tell me what Mr. Cummins told you? Well, Mr. Cummins was originally from Kinsale and 11 how I -- that is how I knew him. 12 Kinsale on holiday. 13 42 Q 14 A He used to come to Yes? I think that himself and Mr. Collins and a guy 15 by the name of Keith Smith, who was a friend 16 of Cummins. 17 43 Q 18 A 19 44 Q 20 A 21 22 Yes ? He was the driving force behind this thing. Yes? Mr. Cummins seemed to have been quite happy with the project per say. 45 Q 23 Yes. However, just tell me did you meet Mr. Cummins? 24 A 25 46 Q 26 A I did meet...(INTERJECTION). About this? I did meet Mr. Cummins, yes. 27 What did he tell you? 28 That he was quite happy with the project and 29 quite...(INTERJECTION). 1 48 Q. 2 3 What was he -- tell me what he told you the project was ? A. That it was an RV Park and an investment in the 4 thing, to build and develop, to get this land and 5 get it zoned, and develop these RV lots per say. 6 4 9 Q. 7 involved? 8 A. 9 50 Q. 10 11 Did he tell you how much he thought would be Not specifically, No. I don't think at the time. However, generally he must have talked. He must have talked to you generally? A. I am sure that he did but Chairman I honestly 12 couldn't swear exactly what the man said to me. 13 is twenty years ago. 14 51 Q. 15 A. 17 52 Q. 18 A. 19 53 Q. 20 A. 21 54 Q. 22 A. 23 55 Q. 29 I can't honestly remember about it. You remember meeting him at any rate? I do because I knew Mr. Cummins fairly well. Yes? And he used to come to Kinsale on holidays. Yes. Do you remember when this was? Well, it must have been around 1980 because that Why do you think it must have been around about 1980? A. 27 28 I don't. is ...(INTERJECTION). 25 26 Did Mr. Cummins come to you with Mr. Collins or did he come to you alone first, do you remember? 16 24 Yes. It Because it looks like that that is when the deal commenced per say. 56 Q. Why do you say "it looks like that" Mr. Boland? 1 set up in 1981 and the loan was made by the AIB 2 in 1981? 3 Yes . 4 57 Q 5 How do you -- can you remember when he first came to you? 6 A 7 58 Q 8 I can't. No, no. I cannot remember Chairman. Mr. Boland, did you have any professional advice in relation to this? 9 A 10 59 Q 11 A No, not really, no. What do you mean "not really"? Well, only my own. I was -- technically I am a bit 12 of a wheeler dealer in my own right, and always have 13 been, and I would go on steers and gut feelings and 14 I felt...(INTERJECTION). 15 60 Q Yes. However, you need -- you are a very successful 16 businessman but successful businessmen need 17 professional help? 18 A 19 61 Q 20 A 21 62 Q I would agree, yes. I would agree. Did you go to a solicitor? I didn't go to a solicitor, no. Did you have your own solicitor then? Who was 22 looking after your private affairs for example? 23 Twenty years ago, it may be difficult to remember. 24 However, was it the same solicitor you now have? 25 A At the time I can't remember who looked after my 26 private affairs. 27 business. 28 Yes? 29 Ronan Daly Hayes did some of my 1 64 Q. 2 A. 3 65 Q. 4 A. 5 66 Q. 6 A. 8 67 Q. 9 A. 10 68 Q. 11 A. 13 69 Q. 14 A. 15 70 Q. 16 A. 17 71 Q. 18 A. 19 I didn't seek any advice which...(INTERJECTION). What about an accountant? Did you seek any Unfortunately I didn't. You did not? No, no. Did you have your own accountant looking after Craig Gardners. They were looking after...(INTERJECTION)? All my ...(INTERJECTION). Were they looking after your personal affairs? Yes. Yes. You did not go to anybody then? I didn't unfortunately. If I had, Chairman, I would have structured my deal correctly. 20 72 Q. 21 A. 22 Yes. Because I wound up with this total loss which...(INTERJECTION). 23 73 Q. 24 A. 25 7 4 Q. 26 29 You did not? your...(INTERJECTION)? 12 28 But I didn't. assistance from an accountant? 7 27 Yes? We will come to that later? Yes. Your position is that you cannot remember when Mr. Cummins came to you? A. Strictly speaking, no. I mean I couldn't swear to when he came to me Chairman. 1 2 3 Yes . 76 Q 4 5 However, you must have had some correspondence about this? A I am sure that there was a -- there was some 6 correspondence I am sure, or some requests, or phone 7 requests or whatever it was. 8 77 Q 9 10 Are you suggesting that this whole transaction went on over the phone? A I am not suggesting but like I can't recollect with 11 my having taken an oath as to how exactly it went on 12 Chairman. 13 78 Q 14 A 15 79 Q 16 No. However, is it not likely that there was some correspondence? 17 A 18 80 Q 19 A 20 81 Q 21 A 22 23 Not actually? I am sure there was. There was. Yes? Because there was a . ..(INTERJECTION). With whom do you think there was correspondence? Well, there was correspondence definitely from AIB Bank. 82 Q 24 Yes. I would have thought so, is that not right Mr. Boland? 25 A 26 83 Q 27 A 28 84 Q 29 A That is right. The Bank would have been in touch with you? Yes, yes. Which bank was that? AIB Bank in 66 South Mall. 14 I signed a guarantee for 1 2 85 Q. 3 There was correspondence then with the Cork Branch of AIB about a guarantee? 4 A. 5 8 6 Q. 6 7 Yes. That is correct. Would you tell me about the guarantee and what was agreed? A. 8 Well, I agreed to sign a guarantee. I was asked to go to 66 South Mall and I signed a guarantee. 9 87 Q. 10 A. Yes? And I know that I broke every rule in the book in 11 signing a joint and several because I had always 12 made it my business -- at one stage in my career 13 with some bank I was caught with a joint and several 14 guarantee. 15 88 Q. 16 A. 17 89 Q. 18 A. Just tell me about the...(INTERJECTION)? And I said I would never again sign one. Tell me what was the guarantee about? The guarantee was joint and several guarantee 19 between myself and the other people who were 20 involved in the project. 21 90 Q. 22 A. 23 91 Q. 24 A. 25 92 Q. 26 A. 27 93 Q. 28 29 What was it? It was for US$2.77m I think. You were guaranteeing the repayment of that? Yes. Jointly and severally? Jointly and severally, yes. The guarantee was for what Mr. Boland? happening? What were you guaranteeing? What was 1 94 Q 2 A 3 95 Q 4 A 5 96 Q 6 A 7 8 In New York? Well, I don't whether it was. Do you not know? I don't know whether it was -- more than likely it was New York but it was...(INTERJECTION). 97 Q 9 10 AIB Bank. Mr. Boland, do you not know that you were sued by the New York Bank? A Well, I am -- what I am trying to say Chairman, I 11 don't know who was borrowing -- sending -- lending 12 the money. 13 98 Q 14 Was it 66 South Mall or New York? However, do you not know that you were giving the guarantee to New York? 15 A 16 99 Q 17 A 18 100 Q Well, if I did I did. No, no. I am asking you a question Mr. Boland? I don't know because I signed...(INTERJECTION). No, wait now. Wait now. Are you telling m e . ..(INTERJECTION)? 19 20 A 21 101 Q Chairman, I signed...(INTERJECTION). Mr. Boland, wait a minute. Are you telling me that 22 you do not know the name of the bank with whom you 23 gave a guarantee for $2.775m? 24 A 25 102 Q 26 A 27 103 Q 28 A 29 AIB Bank. Yes. Which Branch of the AIB bank? Well, I signed...(INTERJECTION). Which corporate entity? I signed the guarantee Chairman inside in 66 South Mall. 1 104 Q I know that. Are you telling me that you do not 2 know that you were guaranteed a loan by the New York 3 Branch of the AIB? 4 A 5 105 Q 6 A Well, I knew at the time I presume, yes. Why did you not tell me that? Well, I am not -- I am trying to say that I don't 7 know who was the forwarder of the money per say, was 8 it AIB in 66 South Mall? 9 106 Q I did not ask you that. I asked you who you signed 10 the guarantee with. 11 with the New York Branch of AIB? 12 A 13 107 Q 14 15 A However, I will ask you the question again: Do you Well, it was AIB New York were involved in forwarding the money or providing the money . 108 Q 18 19 Well, I signed it in 66 South Mall. know who you signed the guarantee with? 16 17 Is it not clear you signed it Does that mean that you think you signed it with AIB New York? A Well, its not a case -- all I am trying to make the 20 point is that I signed it in Cork, probably on 21 behalf...(INTERJECTION). 22 109 Q However, that is not -- you are making that point 23 Mr. Boland. 24 Who sued you? 25 A 26 110 Q 27 A 28 111 Q 29 I am asking you to answer the question. AIB Bank. Which? Of where? Of -- probably the New York Branch. 1 112 Q 2 Tell me what you understood then, that the New York Branch was lending money to whom? 3 A 4 113 Q 5 A 6 114 Q 7 A 8 115 Q 9 A 10 116 Q 11 Was lending money to this Apache project. To whom? Roadhaven. However, who was it lending the money to? It was lending it to Lynbrett. Lynbrett? Yes . Yes. I think, am I correct Mr. Boland, that the Lynbrett was then lending it on to this company? 12 A 13 117 Q 14 A 15 118 Q 16 A 17 119 Q That is correct. What was the name of the company? Roadhaven. Yes? Resorts. Yes. In addition to the loan, which was being given 18 by the New York Bank, where you required to put up a 19 sum yourself? 20 A 21 120 Q 22 A 23 How much were you required to put up? Too -- well, it eventually wound up at US$212,000 Chairman. 24 121 Q 25 A 26 122 Q 27 A 28 123 Q 29 I was, yes. US$212,000? Yes . This was a share of which you had to pay? That is correct. I think, we understanding from Mr. Coveney's statement, that the figure was US$950,000? 1 2 124 Q 3 A 4 125 Q 5 6 A Could you tell me how you raised that money, from Well, I have -- the best recollection I have Chairman is that I paid it out from the UK. 8 126 Q 9 A 10 127 Q 11 Yes? From shares that I disposed of. Just tell me what you did? You must have some record of what happened? A Well, I had shares in the United Kingdom which I sold, which were...(INTERJECTION). 13 14 Yes, that is correct. where and when? 7 12 Yes, that is correct. 128 Q When you said you had shares in the United Kingdom, 15 was this in a -- you had shares in a United Kingdom 16 company, is that what you are saying? 17 A 18 129 Q 19 A 20 130 Q 21 A United Dominions Trust. 22 131 Q United Dominions Trust? 23 A 24 132 Q 25 You had shares in a United Kingdom company? Yes . What was the name of that company you had shares in? Yes . Did you instruct your stockbroker then to sell shares to give you US$212,500? 26 A 27 133 Q 28 A 29 In a United Kingdom company, yes. I doubt it. I doubt it. What did you do? Well, I would say that I probably sold the shares and as far as I know I sold the shares and I had 1 2 134 Q. 3 A. Yes? This was all part of an investigation with the 4 Revenue and that is how I know that these shares -­ 5 and I did inform the Revenue that this money went 6 into this US venture and that was in 7 19...(INTERJECTION). 8 135 Q. 9 10 question is: A. 11 12 You are not answering the question Mr. Boland. How did you raise the US$212,500? By the sale of -- well, some of it was by the sale of shares I imagine. 136 Q. You are under oath. You are not to imagine. 13 You are to give me evidence. 14 am I ... (INTERJECTION)? A. 16 137 Q. 17 A. 18 138 Q. 19 A. Well, I can't recollect exactly. 20 139 Q. No, I am not asking for exactly. 21 A. Would you try t o ...(INTERJECTION)? And...(INTERJECTION). If you cannot recollect tell me so? I am asking you I would say that the bulk of it was from the sale of securities in the UK. 140 Q. 25 You told me about the United Dominions Trust securities ? 26 A. 27 141 Q. 28 A. 29 I am very much aware that I am under oath. how you raised US$212,500? 23 24 Chairman, Now Mr. Boland, 15 22 The Yes, yes. You think you sold other securities? No, I -- to my -- I had sold some United Dominions Trust shares and bought some English bonds or 1 2 142 Q. 3 A. 4 143 Q. You sold? 5 A. Yes, yes. 6 144 Q. 7 A. 8 145 Q. 9 A. From my own resources. 10 146 Q. In the United Kingdom? 11 A. In the United Kingdom. 12 147 Q. 13 A. 14 148 Q. 16 A. 17 Yes, I see? Yes, and...(INTERJECTION). So it was from your own resources? Yes? And possibly some of my resources in Ireland What is your recollection? My recollection is that the bulk of it Chairman came from my sale of my shares in the United kingdom. 149 Q. 19 20 Which I sold. but...(INTERJECTION). 15 18 Yes? And some of them may have come by sale of shares, was it, here in Ireland? A. 21 No, I would have had monies of my own at that time, you know. 22 150 Q. 23 A. Monies of your own but where, on deposit? Well, probably in my business or, you know, I didn't 24 keep -- I used to use what money I had even 25 personally in my business, you know. 26 151 Q. 27 You may have taken money from your business for this purpose? 28 A. 29 152 Q. I could have, yes. Have you any record of this? 1 2 153 Q 3 4 When you say "not now", you had a record? You had a record of...(INTERJECTION)? A 5 Well, there would have been records at that stage, yes . 6 154 Q 7 A 8 155 Q 9 Yes? Yes . For example there would have been a record of the payment, would there not? 10 A 11 156 Q 12 A 13 The payment of? The payment of the US$212,500? Well, I know that it is was put in because I paid my share. 14 157 Q 15 A 16 158 Q 17 A 18 159 Q 19 A 20 160 Q 21 When did you pay it? I can't recollect. I ...(INTERJECTION)? I don't know Chairman. I will come back to the question? Yes . There would have been a record of that payment, would there not? 22 A 23 161 Q 24 A 25 There would have been, yes. How would it have been paid? Well, I presume, and that is all I can say, is that I was asked to put up money, monies. 26 162 Q 27 A 28 163 Q 29 A How would it have been paid Mr. Boland? By -- I presume by draft. By draft? 1 164 Q. 2 A. 3 165 Q. 4 A. 5 166 Q. 6 A. 7 167 Q. 8 A. 9 Yes. You would have got a draft? Yes. For US$212,500? No, it was paid in tranches Chairman. Yes? Because as far as I know my first involvement in much money, I think. 168 Q. 12 I will just come back. Listen to the question I am asking? 13 A. 14 169 Q. 15 A. 16 17 It was a dollar call per say. this venture was that we wouldn't have to put in as 10 11 Yes? Yes. The question is: When was the first tranche paid? Well, I have a letter from your good selves to say that there was US$50,000...(INTERJECTION). 170 Q. 18 No, no, do not bother about that. I am asking for your recollection? 19 A. 20 171 Q. 21 A. 22 172 Q. 23 My recollection is that it was paid in 1980/81. However, how was the first tranche paid? By -- I presume by a dollar draft. Why do you presume? Can you not remember how it was paid? 24 A. 25 173 Q. 26 A. 27 174 Q. 28 A. 29 175 Q. Because it was a draft payment Chairman. It was a draft? Yes. And...(INTERJECTION). It was a dollar payment, sorry, Chairman. Yes. You presume it was a dollar draft? 1 2 176 Q. 3 A. 4 177 Q. 5 A. 6 178 Q. 7 Because it was the only way I could pay it Chairman. Who did you send it on to? I must have given it to Guinness & Mahon. No, no, I am not asking you what you must have done. Can you remember? 8 A. 9 179 Q. 10 A. 11 180 Q. 12 13 Did you...(INTERJECTION)? I don't know who I sent it to. You do not know? I don't know Chairman. You do not know who you sent it on to. How many tranches of the US$212,500 were there? A. 14 My recollection is that there was three or four payments in total. 15 181 Q. 16 A. 17 Three or four payments? Yes, but I can't -- that is only a recollection Chairman. 18 182 Q. 19 A. 20 183 Q. 21 A. 22 184 Q. 23 A. 24 Yes? I want to be careful. Yes? Because I am not certain. Who were they paid to? Well, they were either paid to Guinness & Mahon or to AIB Bank. 25 185 Q. 26 A. In New York? In New York, yes, but they could have been paid 27 Chairman to AIB Bank in the South Mall for 28 transmission to New York. 29 186 Q. I see. However, the arrangement was that you were 1 2 A. 3 187 Q. 4 5 That is correct. Yes. The New York Branch of AIB was to get this sum from you, is that right? A. Well, I am not sure whether it was the Cayman Trust 6 or Guinness & Mahon was to get it or who got it 7 Chairman. 8 188 Q. 9 A. 10 189 Q. Well... (INTERJECTION)? I can't answer you. I don't know. I find it strange Mr. Boland that this is a 11 substantial sum of money and you cannot remember 12 who you paid it to? 13 A. 14 190 Q. 15 A. 16 191 Q. 17 A. 18 192 Q. I know that I paid it into this venture Chairman. No, I know that? I know that. Yes. However, that is...(INTERJECTION)? But the mechanics...(INTERJECTION). Mr. Boland that is not the question I am asking you. 19 I am asking you: 20 it to Lynbrett Trust? 21 New York? 22 A. Who did you pay this sum to? Was Was it to the AIB Bank in Well, what bank it was paid to, it was more than 23 likely -- it was more than likely the Lynbrett Trust 24 that it was paid to. 25 193 Q. 26 A. Yes? But through what conduit it went Chairman I can't 27 answer you. 28 another tranche of money or whatever it was at the 29 time . I would have got a request to pay 1 194 Q. 2 A. 3 195 Q. 4 A. 5 Who would you have got the request from? More than likely from Collins, more than likely. Yes? But like that again I can't swear to it Chairman. am being very careful. 6 196 Q. 7 A. 8 Yes? I just cannot recollect what happened twenty years ago. 9 197 Q. 10 A. 11 Yes? All I have of this whole venture is bad memories. MR. O'FLYNN: 12 moment? 13 14 May I intervene for one MR. JUSTICE COSTELLO: A. Chairman, Yes, yes. I had a very very serious accident in 1977. 15 16 198 Q. 17 A. Yes? So -- which had me technically out of business for 18 about eighteen months and seriously impaired in a 19 lot of ways. 20 199 Q. 21 A. 22 200 Q. 23 A. In 1977 you had an accident? 1977, yes. Yes. Well...(INTERJECTION). So, it did affect a lot of my memory on a lot of 24 things regarding this. 25 hospital for the guts of twelve months. 26 201 Q. 27 28 29 Yes. I was laid up. I was in I just want you to tell me what happened to the records about this whole transaction? A. Well, I don't have any records recording the I 1 my last tranche of money on my indebtedness and 2 the indebtedness of one of my colleagues last 3 February twelve months. 4 202 Q 5 A 6 203 Q Yes ? Now I...(INTERJECTION). The question I am asking you Mr. Boland is about the 7 records. 8 this ? 9 A 10 204 Q 11 A 12 205 Q 13 A 14 206 Q 15 A 16 207 Q 17 A 18 208 Q 19 A 20 209 Q 21 A 22 210 Q 23 What became of the records in relation to Well, I had very little records Chairman. What became of the records Mr. Boland? Well, I presume over the years...(INTERJECTION). Pardon? Over the years I wouldn't have kept them Chairman. You destroyed them, did you? I would have, yes, yes. Would you not have given them to your solicitor? No, I didn't have any reason to. Were you not sued? I was sued, yes. What happened about the action in New York? Well, we -- all we had to do was pay up Chairman. I wonder is that right. Did you not have a High Court action and was it not settled? 24 A 25 211 Q Sorry, an action in the American Courts, was it not? 26 A It was, yes, but we hadn't any -- I hadn't any input It was settled. 27 or any input into that action regarding -- they had 28 a record of what monies I had in it at that stage 29 Chairman. 1 212 Q 2 A 3 213 Q 4 A 5 214 Q 6 I must ask you to try Mr. Boland. Yes . Who did you -- you must have been very concerned with been sued for over $2m, nearly $3m? 7 A 8 215 Q 9 A 10 216 Q 11 A 12 217 Q 13 A 14 218 Q 15 A 16 219 Q 17 A 18 220 Q 19 A 20 221 Q 21 A 22 222 Q 23 A 24 223 Q 25 A 26 224 Q 27 A 28 225 Q 29 I can't...(INTERJECTION). That is right. Did you go to an Irish solicitor? No, no. Not at all? No. Who did you go to? Well, I didn't handle it. Who did you go to? There was -- people in New York were retained. What was the name of the firm Mr. Boland? I can't recollect but I can get it Chairman. Would you get it? I can get it, yes, certainly. Did they ask you for any documents? No. You did not give them any documents? No, they knew what the...(INTERJECTION). Sorry, just listen to the question Mr. Boland? No, Chairman, I didn't give them any documents. You did not? No. Whatever documents you had were not given to any professional advisors? 1 2 226 Q 3 A 4 I didn't have any documentation to give them Chairman. 5 227 Q 6 A 7 You think you destroyed the other documents? Any correspondence, if you care to call it, that I had I wouldn't have kept. 8 228 Q 9 A 10 Yes. When did you destroy them? I wouldn't -- it would be just a matter of course and I would purge. 11 229 Q 12 A 13 What about the last payment that you made? I would have -- I have all the history of my payments to the Bank. 14 230 Q 15 A 16 231 Q 17 A 18 Sorry? I have the history of my payments to the Bank. What do you mean the history of the payments? Well, I have -- I would have -- I know actually when I paid them. 19 232 Q 20 A 21 233 Q 22 A 23 234 Q 24 A 25 235 Q 26 A 27 236 Q 28 A 29 237 Q No. What documents? I would have the...(INTERJECTION). Is the word you are seeking...(INTERJECTION)? Acknowledgments Chairman. Is the word you are seeking "correspondence"? Sorry? Was the word you are seeking "correspondence"? Correspondence? Yes? I would have the acknowledgement of the payments. Sorry, would you have correspondence? 1 2 238 Q What? 3 A Yes . 4 239 Q 5 A 6 240 Q Is the answer "yes"? Yes . Yes. Have you destroyed your correspondence with 7 the AIB Bank, the last payment you made about a year 8 ago? 9 A 10 241 Q 11 A 12 242 Q 13 You have that correspondence? Yes . The correspondence with that Bank is relating to your indebtedness? 14 A 15 243 Q 16 A 17 244 Q 18 19 No. My indebtedness to them. To them, yes? Yes . That file of correspondence, how far does that go back? A It would go back to my first payment. 20 not a file. 21 Chairman. 22 245 Q 23 A 24 25 It is may be six or eight letters Yes? It is -- I particularly wanted to keep that because I paid...(INTERJECTION). 246 Q 26 27 Well, it is No, just the question is: How far does the correspondence go back? A I will try and explain to you Chairman. It would go 28 back to my payment, my first payment, after our 29 settlement with the Bank. 1 247 Q. 2 A. 3 Yes. Who...(INTERJECTION)? Which would be -- I think Chairman you have a copy of the settlement agreement. 4 248 Q. 5 A. 6 249 Q. 7 A. 8 250 Q. 9 A. 10 251 Q. 11 A. Who is the correspondence with? It would be an acknowledgement from 66 South Mall. Who is the correspondence with? AIB, 66 South Mall. Yes? Acknowledging my payments. Yes? And what I am trying to explain Chairman is that I 12 would have paid my share and waited for a demand for 13 the share of my colleague under the guarantee. 14 252 Q. I take it you would not have any objection 15 Mr. Boland to giving us such correspondence that you 16 have in relation to that? 17 A. 18 253 Q. 19 A. 20 254 Q. 21 No problem. Yes? No problem. And any other correspondence that you have in relation to the Lynbrett Trust? 22 A. 23 255 Q. No problem. Yes. Very well. Can you assist us in relation 24 to the lodgement of £50,000 in 1980 to the US 25 Dollar account of Guinness Mahon Cayman Trust in 26 Guinness & Mahon & Company, the London bank? 27 A. 28 29 I can't Chairman. That is $50,000 I think you said in your correspondence. 256 Q. Yes. Sorry, if I said pounds I was wrong? 1 2 257 Q 3 A Yes, a l l I can say i s th a t - - a l l I can not say or 4 a l l I can r e c o l l e c t i s th a t i t must have come from 5 my funds in the UK. 6 258 Q Just so th a t I understand what your evidence i s , 7 have you any r e c o l l e c t i o n o f making a payment of 8 $50,000? 9 A None . 10 259 Q None? 11 A 12 260 Q Yes ? 13 A Yes . 14 261 Q None, but I did put in $50,000 Chairman. I j u s t want to get c l e a r what your evidence i s 15 Mr. Boland. 16 recollection. 17 in $50,000? 18 A 19 262 Q Your evidence i s th a t you have no I take you mean th a t you did not put No, I did put in $50,000. No. You did not lodge $50,000 as fa r as you were 20 p e r s o n a l l y concerned i n t o the US d o l l a r account of 21 Guinness Mahon Cayman Trust in London? 22 A 23 Well, I put in $50,000 i n t o the America p r o j e c t i f I may c a l l i t t h a t . 24 263 Q 25 A 26 264 Q 27 No. I f you would j u s t l i s t e n to the question? Yes . Am I t o understand your ev id e nc e, i s t h a t you did not lodge th a t money i n t o the account? 28 A 29 265 Q I c a n ' t r e c o l l e c t Chairman. 1 2 266 Q. 3 A. 4 267 Q. 5 A. 6 268 Q. 7 8 Sorry. Just stop? Sorry Chairman. I must stop you Mr. Boland? Sorry. You could have lodged $50,000 i n t o the Guinness Mahon Cayman Trust in London? A. 9 I would say th a t I obtained a d r a f t Chairman and passed i t on to somebody fo r my American p r o j e c t . 10 269 Q. 11 A. 12 W e l l . . . (INTERJECTION)? The mechanics o f where i t was lodged I cannot on oath Chairman know how i t was done. 13 270 Q. 14 A. 15 271 Q. No. However, what i s your r e c o l l e c t i o n ? I d o n 't have a r e c o l l e c t i o n Chairman. However, have you any r e c o l l e c t i o n of where the 16 money - - you got a d ra ft you say — where you sent 17 it? 18 A. 20 272 Q. 21 A. 22 No, no. You cannot r e c o l l e c t you got a d raf t? Well, Chairman I must have because i t was recorded a f t e r th at I put in , in t o t a l , 273 Q. 24 $212,000. I j u s t want to get your e v i d e n c e. You cannot r e c o l l e c t g e t t i n g a d raf t? 25 A. 26 274 Q. 27 A. 28 275 Q. 29 I am only assuming I got a d ra f t Chairman. 19 23 I can't r e c o lle c t . No. You cannot r e c o l l e c t who you paid t h i s sum to? No, Chairman. You have no r e c o l l e c t i o n o f sending the money to London? 1 2 276 Q 3 You have no r e c o l l e c t whether you se nt i t t o New York? 4 A 5 277 Q No r e c o l l e c t i o n at a l l . You have no r e c o l l e c t i o n whether you se nt i t to the AIB Bank in Cork? 6 7 A 8 278 Q 9 No. Mr. Boland, I th in k we w i l l adjourn now i f t h a t i s a l l r i g h t with you, for a cup o f c o f f e e fo r about 10 ten minutes? 11 A 12 279 Q 13 Okay. I f you would l i k e to s t a y here we can gi v e you a cup of c o f f e e ? 14 A 15 280 Q 16 A Okay. And we w i l l return then? Yes . 17 18 SHORT ADJOURNMENT 19 20 MR. JUSTICE COSTELLO: 21 We w i l l resume Mr. Boland. Ms. Mackey has some 22 fu r t h e r q u e s t i o n s to ask you. 23 Thank you. 24 END OF EXAMINATION OF MR. BOLAND BY MR. JUSTICE 25 COSTELLO 26 27 28 29 1 2 3 MS. MACKEY: Mr. Boland, I j u s t wanted 4 to ask you some q u es ti o n s 5 about the Lynbrett Trust i t s e l f and your own a c t u a l 6 involvement in i t and what you know about i t and so 7 on. 8 A 9 282 Q Yes . You were e x p l a i n i n g to us e a r l i e r t h a t you were 10 f i r s t approached about t h i s p r o j e c t probably by Mr. 11 Collins, 12 have been Mr. C o l l i n s . 13 who t o l d you about the s t r u c t u r e and about the 14 Lynbrett Trust and i t s a s s o c i a t e d companies? 15 A 16 283 Q 17 A 18 19 you were not c e r t a i n but you th in k i t might Who was the f i r s t person I h o n e s t l y c a n ' t remember. Can you r e c o l l e c t hearing about i t from somebody? Well, I d e f i n i t e l y heard about i t from somebody but from whom I c a n ' t t e l l you. 284 Q 20 Right. Can you remember what you heard about i t ? What you were t o ld ? 21 A 22 285 Q 23 A 24 286 Q 25 A 26 287 Q I can't. Can you not remember anything at a l l ? I cannot, no. You cannot? I c a n ' t , no. May be I can a s s i s t you a l i t t l e b i t . You can 27 remember, I am sure, th a t t h er e were f i v e companies 28 established? 29 A 1 288 Q. 2 A. 3 289 Q. 4 A. 6 290 Q. 7 A. 8 2 91 Q. 9 A. I had one company which was c a l l e d Medford. Your company was Medford. Yes. Do you know or did you know at the time where I would say I did. I would say I did, yes, th a t i t was in Cayman. 12 2 92 Q. 13 A. 14 2 93 Q. 15 I t was a Cayman company? Yes. Why was the company r e g i s t e r e d in the Caymans rath er than in Ireland? A. 17 This was part o f the deal why we were approached, i s my understanding o f i t . 18 294 Q. 19 A. Yes? Is t h a t the US i n v e s t o r s wanted - - t h i s was a l l put together, 20 21 295 Q. 22 A. 23 296 Q. 24 A. 25 297 Q. 26 i s my understanding. Yes? To f a c i l i t a t e the US i n v e s t o r s . Yes. And i t was to do with compliance with US t ax law. In what way was i t n e ce s s a ry fo r you fo r tax purposes th a t the company be a Cayman company? 27 A. 28 298 Q. 29 Can you r e c o l l e c t which company you were a s s o c i a t e d Medford was r e g i s t e r e d ? 11 16 Yes, th a t i s c o r r e c t . with? 5 10 Within t h i s t r u s t ? I c a n ' t answer you t h a t . I ha v en 't an id e a . Was i t e x p la in e d to you then how the Trust would 1 way from t h i s Trust? 2 it? 3 My understanding was th a t I was t o get a share of 4 the p r o f i t s of t h i s venture. 5 299 Q 6 A What was your understanding of Yes ? Now, regarding the Trust and a l l of t h a t , I don't 7 have any r e c o l l e c t i o n o f th a t being of any advantage 8 t o us . 9 300 Q 10 11 A 301 Q A I t was to come to me p e r s o n a l l y I presume. only making a presumption. 302 Q 18 19 However, was i t to come to you p e r s o n a l l y or to t h i s company Medford? 16 17 I t was in the washout o f the de a l, whatever was l e f t we had a perce nta ge t o g e t . 14 15 How was the share to come t o you, of the share o f the p r o f i t s ? 12 13 How were you to get the share? I am That i s a l l I can say. What was your understanding o f the r o l e of Medford in this? A I t was - - my understanding o f the r o l e of Medford 20 and Lynbrett was th a t i t was a v e h i c l e t o f a c i l i t a t e 21 the US i n v e s t o r s . 22 303 Q 23 24 Medford s p e c i f i c a l l y because Medford was your company, i s th a t not ri g h t ? A 25 I presumed th a t th a t was to keep us separated, our shareholdings. 26 304 Q 27 A 28 305 Q 29 No, no. To keep your sha reh old ing s separate? Separated, I presume i t was, ye s. Did Medford then hold your shares in the company? 1 anybody. 2 my share. 3 306 Q 4 5 Right. A l l I know i s th a t I p e r s o n a l l y paid for What did you get as a r e s u l t of t h a t , what documentation? A I got nothing. I d i d n ' t because I had arguments 6 with - - w e l l , not arguments. 7 the Revenue a f t e r . 8 307 Q 9 A I had d i s c u s s i o n with Yes? Trying to get a tax rebate per say, which I w i l l 10 r e f e r t o in a minute because I would l i k e t o put on 11 the record what I did with the Revenue. 12 308 Q 13 A 14 309 Q 15 A Yes ? Trying to get my rebate o f f s e t s . Yes? And I was informed i t was a loan and I wasn't 16 entitled. 17 by the Revenue and my tax pe o p le . 18 310 Q 19 I t wasn't a c a p i t a l l o s s , I was advised Did you r e c e i v e any st atements of the a f f a i r s of Medford? 20 A No. 21 311 Q No? 22 A No. 23 312 Q Going back to the s e t t i n g up o f t h i s , you exp lai ne d 24 t o us th a t you got no a d v ic e , you sought no 25 f i n a n c i a l a d v ic e . 26 Medford would be s e t up, and i t would be your 27 company? 28 29 A Who t o l d you t h a t t h i s company What were you t o l d about i t ? I c a n ' t h o n e s t l y answer you. Did you have d i s c u s s i o n s at th a t time apart from 38 1 d i s c u s s i o n s with your f e l l o w i n v e s t o r s ? 2 have d i s c u s s i o n s with Guinness & Mahon? 3 I have no r e c o l l e c t i o n . 4 recollection . 5 314 Q I have none. No At t h a t time were you y o u r s e l f in any 6 r e l a t i o n s h i p with Guinness & Mahon? 7 know Guinness & Mahon or anybody there? 8 A 9 315 Q 10 A 11 Did you Did you I knew Guinness & Mahon. Yes. How did you come to know Guinness & Mahon? I did a v a s t amount of b u s i n e s s with Guinness & Mahon with my firm in Cork. 12 316 Q 13 A 14 317 Q 15 A 16 318 Q 17 A Yes ? In Cork in p a r t i c u l a r . Yes? With the Cork o f f i c e of Guinness & Mahon. Yes . And I got a copy of a l l th a t documentation. I th ink 18 i t was made a v a i l a b l e to you and r e a l l y i t had to do 19 — we used to buy a l l o u r . . . ( INTERJECTION). 20 319 Q 21 back q u it e some time p r i o r to any of t h i s ? 22 A 23 320 Q 24 A 25 321 Q 26 27 I would say so . I hav en 't looked at the d a t e s . Right? I would say I had. Who s p e c i f i c a l l y did you know in Guinness & Mahon or dea l with? A 28 29 You had a r e l a t i o n s h i p with Guinness & Mahon going We used to deal at th at time with a man by the name of Howard, in Cork. 322 Q Howard? 1 2 323 Q 3 A 4 5 324 Q A 8 325 Q 9 A 10 326 Q 11 A 12 327 Q 13 A 14 I knew Des Traynor. You knew Des Traynor? Yes . When did you come to know Des Traynor? I c a n ' t answer you t h a t . I don 't e x a c t l y know. How did you know? I would have met him. I would have met him s o c i a l l y with Clayton Love. 328 Q 16 Did you know o f h i s involvement with Guinness & Mahon in the Cayman I sl an ds? A 18 19 Did you know any o f the perso nn el of Guinness & Mahon in Dublin? 7 17 And a man by the name o f Dominic Long, who was with him u n t i l they c l o s e d down in Cork. 6 15 Yes ? I knew of h i s involvement with Guinness & Mahon, yes . 329 Q However, did you know o f h i s involvement with Guinness & Mahon in Cayman? 20 21 A 22 330 Q 23 A 24 Not r e a l l y . I t wasn' t . . . ( INTERJECTION). Guinness Mahon Cayman Trust? I t wa sn' t, no. I t wasn't r e a l l y of any concern to me . 25 331 Q 26 A 27 However, had you heard o f i t ? I have heard o f i t . papers. 28 332 Q 29 A Did you know then? I have now read i t in a l l the 1 333 Q 2 Did you meet Mr. Traynor f r e q u e n t l y on a s o c i a l basis ? 3 A 4 334 Q 5 A 6 335 Q 7 A 8 336 Q 9 No, no. Did you have b u s i n e s s d e a l i n g s with Mr. Traynor? No, no. Never? No. Did you have any d i s c u s s i o n s with Mr. Traynor in r e l a t i o n to the Lynbrett Trust? 10 A 11 337 Q 12 A 13 338 Q I can't r e c o lle c t honestly. Is i t p o s s i b l e th a t you did? I doubt I did. I doubt I did. In r e l a t i o n to the Lynbrett Trust Mr. Boland your 14 e vi den ce , i f I can summarise i t , 15 remember who t o l d you about i t . 16 of the companies under the Trust, a Cayman company 17 c a l l e d Medford, was your company but you are not 18 sure what purpose i t served for you? 19 A 20 339 Q 21 A 22 340 Q i s t h a t you cannot You know t h a t one Yes . Other than to hold shares? Yes . You do not know - - you were to get a share of the 23 p r o f i t s but you are not sure how t h a t was t o come to 24 you? 25 A 26 341 Q Yes . You never r e c e i v e d any statement of a f f a i r s o f the 27 company Medford. 28 evidence? 29 A Is th at a c o r r e c t summary o f your 1 342 Q. Did none o f t h i s worry you or make you f e e l t h a t you 2 needed some adv ice about i t ? 3 s t ru ct u re ? 4 A. Well, none of i t concerned me. I t seems a very vague I mean I was 5 t e c h n i c a l l y in a r e l a t i o n s h i p with other c o l l e a g u e s 6 who I t r u s t e d . 7 343 Q. Right. You t o l d us e a r l i e r th a t your own p a r t i c u l a r 8 c o n t r i b u t i o n to the investment, your own p a r t i c u l a r 9 share of the investment o f $950,000, was $212,000? 10 A. 11 344 Q. Y es . Did each member of the consortium or group, i f we 12 can c a l l i t t h a t , 13 how was i t done? 14 A. 15 345 Q. 16 A. 17 I d o n 't th in k so . Yes. c o n t r ib u t e an i d e n t i c a l amount or Mr. Dineen c o n t r ib u t e d l e s s . What about the others? The o t h e r s , to my r e c o l l e c t i o n , put in the same as I d id. 18 346 Q. 19 A. 20 347 Q. 21 A. 22 348 Q. 23 A. 24 349 Q. Do you know what Mr. Dineen's c o n t r i b u t i o n was? I am not sure but I th in k i t was about h a l f o f i t . Half of the othe r p e o p l e ' s co n tr ib u t io n ? I th in k so, y es . Half of yours? Yes, yes. You are aware, I am sure, th a t Mr. Traynor of 25 Guinness & Mahon was the person who advice on t h i s 26 s t r u c t u r e , the s e t t i n g up o f the Lynbrett Trust? 27 A. 28 350 Q. 29 I am not c e r t a i n who did adv ice out the s t r u c t u r e . Are you aware th a t i t was a Guinness & Mahon 1 2 351 Q 3 Were you aware at the time th a t i t was Guinness & Mahon? 4 A 5 352 Q 6 A 7 353 Q I was, yes. Did Mr. C o l l i n s t e l l you that? Yes, I presume he did. And t h a t would have reass ure d you, I am sure, 8 t o know th a t a Bank of the r e p u t a t io n of 9 Guinness & Mahon had adv ised on t h i s s t ru ct u re ? 10 A 11 12 Well, I knew o f them. I knew o f Guinness & Mahon because we used to do b u s i n e s s with them. 354 Q Yes. However, what I am asking you i s would th at 13 have given you some reassurance? 14 been why you did not seek f i n a n c i a l advice elsewhere 15 i f t hey had s e t up t h i s s t r u c t u r e , would 16 t h a t . . . (INTERJECTION)? 17 A 18 355 Q 19 Might t h a t have I t probably would have give n me some. Right. Did you at th at time come ac ros s anybody from Stokes Kennedy Crowley? 20 A 21 356 Q 22 A 23 357 Q No. In r e l a t i o n to the s e t t i n g up o f t h i s ? Never done b u s i n e s s with them, no. Did a l l o f you t o g e t h e r , the f i v e of you t o g e t h e r , 24 have meetings about t h i s , 25 the companies th a t each o f you were t o have? 26 A and about the Trust, and I c a n ' t r e c o l l e c t h o n e s t l y , you know. We would, 27 you know - - t h er e would be phone c a l l s . 28 c o n s t a n t l y t r a v e l l i n g at th a t time, here t h er e and 29 everywhere, you know, and s o . . . (INTERJECTION). I was 1 358 Q. 2 However, did you not at any s t a ge s i t down t o g e t h e r , t h i s was a complicated deal? 3 A. 4 359 Q. 5 More than l i k e l y we did, you know. Yes. Would Mr. Traynor have been p re s en t at t h a t or a member of Guinness & Mahon? 6 A. 7 360 Q. 8 A. 9 361 Q. 10 A. 11 362 Q. Not t h a t I can r e c o l l e c t . You do not r e c o l l e c t any such meeting? No, no. Just g e t t i n g back for a moment to Medford? Y es . How were you t o l d th a t t h i s company was t o operate 12 on b e h a l f of you? 13 r e g i s t e r e d owner o f t h i s company? 14 your r e l a t i o n s h i p with Medford? 15 A. 16 363 Q. 17 A. In othe r words were you to be the What was to be I c a n ' t h o n e s t l y answer you. You cannot remember? A l l I know i s th a t th ere was a, fo r the sake of 18 c a l l i n g i t and I don 't know i f I am p u t t i n g the 19 r i g h t word on i t , 20 f i v e companies th a t owned th a t company and my 21 understanding o f i t was th a t th a t was my share. 22 364 Q. 23 A. 24 365 Q. 25 A. hold ing company and th er e was That was your share? Y es . Were you a shareholder in Medford, i s t h a t i t ? I d o n 't know what I was, you know, because I d i d n ' t . . . (INTERJECTION). 26 27 366 Q. 28 A. 29 367 Q. Did you not ask? Not t h a t . . . (INTERJECTION). You are an ex pe ri enc ed businessman? 1 2 368 Q 3 You must have r e a l i s e d you would have t o hold the shares in the company, acquire them in some way? 4 A 5 369 Q 6 A I d o n 't - - I c a n ' t r e c o l l e c t what I done, you know. I cannot r e c o l l e c t ? I can't r e c o lle c t . I f in d i t very hard and I am not 7 being e v a s i v e but I c a n ' t r e c o l l e c t what I done two 8 or t h re e years ago. 9 370 Q 10 A 11 Yes ? I mean I am being ho nes t. I mean I c a n ' t and I am under oath so I want to b e . . . (INTERJECTION). 12 371 Q 13 A 14 372 Q 15 A 16 373 Q 17 A 18 374 Q Yes ? You know. I ap p r e c i a te th a t i t . . . ( INTERJECTION)? I mean twenty years ago I h a v e . . . (INTERJECTION). I ap p r e c i a te i t i s d i f f i c u l t to r e c a l l d e t a i l ? Yes . However, t h i s was n e v e r t h e l e s s a huge t r a n s a c t i o n 19 t h a t had t e r r i b l e i m p l i c a t i o n s for you and the 20 oth ers ? 21 A 22 375 Q 23 A 24 376 Q Well, i t became a huge t r a n s a c t i o n a f t e r . Yes? From the stand p o in t th a t i t went o f f the r a i l s . I would have thought t h a t , you know, the d e t a i l s of 25 it, 26 the Trust i t s e l f , might have stuck in your mind? 27 A 28 377 Q 29 A at l e a s t in r e l a t i o n to the var io us e n t i t i e s and Yes . However, you do not r e c o l l e c t ? 1 Yes. 2 Mr. J u s t i c e C o s t e l l o j u s t wants t o ask you some 3 more . 4 END OF EXAMINATION OF MR. BOLAND BY MS. MACKEY 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 I have no f u rt h er q u e s t i o n s . I th ink 1 2 COSTELLO: 3 4 379 Q MR. JUSTICE COSTELLO: 5 Just to be a b s o l u t e l y c l e a r about your evidence 6 Mr. Boland? 7 A 8 380 Q 9 Yes . You had a very c l o s e r e l a t i o n s h i p , i t appears, with the Cork o f f i c e o f Guinness & Mahon? 10 A 11 381 Q 12 A That i s c o r r e c t . When did i t c l o s e , do you remember? Well, I got c o p ie s of the f i l e s . Sandra K e ll s 13 wrote t o me to say th at your o f f i c e , 14 your o f f i c e , had reques ted t h e s e f i l e s and did I 15 want a copy o f them. 16 382 Q 17 A 18 I th in k i t was Yes ? So, I s a id , "Certainly, I do want a copy of th em ," j u s t . . . (INTERJECTION). 19 383 Q 20 A Have you got those? Because I hadn't them and - - I mean what they were 21 and t h i s i s one f i l e th a t I want t o r a i s e now 22 (INDICATING). 23 384 Q 24 A Yes ? Because i t would be in c o n f l i c t with may be what 25 Mr. O'Flynn s a i d . 26 t h a t I d is c o v e r e d t h i s . 27 385 Q 28 29 I t was only going through t h i s Just l i s t e n to the q u es ti o n , you got f i l e s from Sandra Ke lls ? A Yes, I got a copy o f what she gave t o your o f f i c e . 47 1 386 Q. 2 A. 4 387 Q. 5 A. 6 388 Q. 7 A. 8 389 Q. 9 A. 10 390 Q. 11 A. 12 391 Q. 13 A. 14 392 Q. 15 A. 16 393 Q. 17 A. 18 394 Q. 19 A. 20 395 Q. Sorry. I want to know can you g i v e us co p ie s of them? C e r t a in ly , y es. You can? Yes, c e r t a i n l y . Very w e l l . These f i l e s r e l a t e d t o what Mr. Boland? To my d e a l i n g s with Guinness & Mahon. Yes. From what period? I presume from the very s t a r t . When you say you presume, did you look at the f i l e s ? I looked at the f i l e s , yes. When do they s t a r t , the date when th ey s t a r te d ? I presume they are 1970. 1970, yes . Any way. . . ( INTERJECTION)? I c a n ' t answer you but I can g iv e you them. Yes. You can g i v e them to us? I presumed Chairman th at i t was you had got the Yes. You can g i v e us t h o se f i l e s any way Mr. Boland? 23 A. 24 396 Q. 25 Y es . From the 19 70's you would have d e a l i n g s with Guinness & Mahon in the Cork o f f i c e ? 26 A. 27 397 Q. 29 They were not given to us. files . 22 28 You got c o p i e s . I j u s t want to know.. . (INTERJECTION)? 3 21 No, no. In the Cork o f f i c e . I am j u s t wondering can you r e c o l l e c t when the Cork o f f i c e cl osed ? 1 Was i t r e c e n t l y ? 2 Mr. O'Flynn knows? 3 MR. O'FLYNN: Was i t in the - - perhaps 4 I was in v o lv e d in the c l o s u r e of i t , yes. 5 MR. JUSTICE COSTELLO: Yes . 6 MR. O'FLYNN: I t was about f i v e years 7 ago. 8 MR. JUSTICE COSTELLO: About f i v e years ago? 9 MR. O'FLYNN: Yes, yes MR. JUSTICE COSTELLO: About f i v e years ago then 10 399 Q 11 the Cork o f f i c e c l o s e d . 12 Did you then proceed to have n e g o t i a t i o n s , to carry 13 on b u s i n e s s , with the Dublin o f f i c e ? 14 A 15 400 Q 16 A 17 401 Q 18 A 19 No. You did not? No, Chairman j u s t to c l a r i f y the t h i n g . Yes ? I d o n 't th in k th a t I did b u s i n e s s with the Cork o f f i c e up to f i v e years ago i f you know what I mean. 20 402 Q 21 A 22 I see? I - - my b u s i n e s s with the Cork o f f i c e was buying foreign d rafts. 23 403 Q 24 A 25 404 Q 26 A 27 Yes ? For my b u s i n e s s . Yes ? And when I got the f i l e - - the f i l e i s a f a i r l y hefty f i l e . 28 405 Q 29 A Yes? 1 2 40 6 Q 3 A 4 Yes ? And we would have been paying our c r e d i t o r s and s tu ff lik e that. 5 407 Q 6 A Yes ? And the reason fo r th at was th a t we were able to 7 ob ta in a b e t t e r r a t e than o f f the other banks and i t 8 was a ...(INTERJECTION). 9 408 Q Yes. I must ask you j u s t formally, but I understand 10 from your evide nc e th at the s i t u a t i o n i s such th at 11 your evidence i s th a t you never e s t a b l i s h e d a Trust 12 through Guinness & Mahon, i s th a t ri g h t ? 13 A 14 409 Q 15 A 16 410 Q 17 A 18 411 Q 19 A 20 412 Q 21 A 22 413 Q 23 A 24 414 Q 25 A 26 415 Q Well, the record says th a t I did e s t a b l i s h a Trust. No, apart from the Lynbrett Trust? Yes . Apart from Lynbrett Trust? Yes . Did you ever d e p o s i t money with Guinness & Mahon? Well, I would have sent money to the Lynbrett Trust. Apart from that? Apart from t h a t , no. No. You never had an account in the Cayman I sla n ds? No, no, no. Or none o f your companies? No, no. Very w e l l then. Mr. Boland, i f you could - - t her e 27 was something you wanted to say t o us? 28 This was a t h in g th a t came up in t h e s e copy 29 documents th a t I g o t . This i s part of the f i l e 1 because in Mr. O'Flynn's l e t t e r t o you he sa id 2 t h a t I d i d n ' t hold an account and I d is co v er e d 3 t h a t I did, but i t i s r e c o l l e c t i o n again, with 4 Guinness & Mahon in Dublin. 5 Yes ? 6 A And i t was - - i t r e l a t e d to the purchase of some 7 shares which I bought on b e h a l f of - - on my own 8 b e h a l f and Guinness & Mahon advanced the money on a 9 j o i n t loan account for £16 ,0 00 . 10 417 Q 11 12 Would you j u s t hand me up t h a t f i l e fo r a moment? A 13 Yes (Same Handed) and they o f f e r e d me a loan then fo r my share o f i t and, which I re f u s e d , I paid i t . 14 418 Q 15 A 16 419 Q 17 A 18 420 Q 19 A 20 421 Q 21 A 22 23 Yes. In 1983 t h a t was. Is t h i s the f i l e you obtained from Guinness & Mahon? Yes, I wouldn't have even remembered i t . Yes ? I f I hadn't got i t o f f them Chairman. Yes ? Other than the b u s i n e s s f i l e . Yes. The b u s i n e s s f i l e , you s a y . . . (INTERJECTION)? That i s the only pers on al t h in g t h a t i s t he re Chairman. 422 Q Yes. The documents you got from Sandra K e ll s 24 r e l a t e d to your d e a l i n g s with the Cork branch of 25 Guinness & Mahon? 26 A 27 423 Q 28 29 Yes . However, in a d d it io n t h er e i s t h i s document, t h i s file? 1 424 Q 2 A 3 425 Q No, no. I th ink we b e t t e r have a l l the f i l e s t h a t you got 4 from Sandra K e l l s . 5 you got o f f of her? 6 A Yes. 7 426 Q Yes? 8 A 9 427 Q You can g i v e us a l l the f i l e s Well, th er e i s th a t one and the b u s i n e s s one. You can keep th a t one Chairman. MS. MACKEY: 10 Mr. Boland? 11 A 12 428 Q 13 A 14 15 Is th a t your copy I have two c o p ie s of i t . MS. MACKEY: You can keep th a t one. MS. MACKEY: A Have you? Very good. Thank you. And I w i l l copy the other one but I was le a d to 16 b e l i e v e th a t Sandra K e ll s had give n you a l l o f t h i s . 17 You see I could have brought i t with me. 18 MS. MACKEY: 19 A Yes . MR. JUSTICE COSTELLO: 20 No, i t was not us. 21 Very w e l l then Mr. Boland. We would requ ir e you to 22 come up to s ig n the t r a n s c r i p t of t h i s evide nc e, 23 which w i l l be typed up s h o r t l y . 24 in touch with you. 25 A 26 Ms. Cummins w i l l be Chairman, I would l i k e to put something e l s e now on the record. 27 429 Q 28 A Yes . 29 430 Q Yes? Sure, yes? 1 I had - - going back to the l a t e 19 80's I was s u b j e c t 2 t o a b i g Revenue aud it per say. 3 431 Q 4 A Yes ? And i t went on fo r a number o f years with 5 Craig Gardners my acc ou nt an ts. 6 and on and a l l t h i s f i a s c o , 7 a b e t t e r word. 8 432 Q 9 A I t went on and on i f I — for the sake of Yes? With my American involvement, i s a l l in i t and the 10 t r a c i n g o f the UDT shares in England and a l l o f th at 11 i s a l l in i t . 12 Chairman th a t I have - - th a t i t i s a l l done with the 13 Revenue and I e v e n t u a l l y wound up with an amnesty 14 o f f Revenue and th a t was even q u es tio n ed a f t e r . 15 There was some p i e c e of i t , 16 i n v e s t i g a t i o n , th a t they wouldn't all o w me on and so 17 f o r t h t o c l e a r a l l my a f f a i r s but t h i s was d e a l t 18 with very very m e t i c u l o u s l y by McCarthy, 19 Tony McCarthy, in the Revenue. 20 t h e . . . (INTERJECTION). 21 433 Q 22 A 23 So, I would j u s t l i k e t o t e l l you th ere was an So, a l l What was d e a l t with was t h e . . . ( INTERJECTION)? A l l my a f f a i r s were but in p a r t i c u l a r t ho se UDT sh ares. 24 434 Q 25 A Yes ? And the r e f e r e n c e to them back to my involvement 26 with the American p r o j e c t and th at 27 w a s . . . (INTERJECTION). 28 29 435 Q And your involvement in the Lynbrett Trust was a l s o done? 1 2 436 Q 3 A 4 5 Craig Gardner ac te d for you? Yes, and th a t was - - th at i s going back t o 1988 but i t wasn't f i n a l i s e d Chairman. 437 Q Would you not have given records t o Craig Gardner, 6 correspondence to Craig Gardner, t h a t you would have 7 had? 8 A 9 Craig Gardner's - - I can get correspondence o f f of them but I w i l l be honest I d i d n ' t want t o go to 10 Craig Gardner's and j u s t t e l l them about t h i s a f f a i r 11 but i f . . . (INTERJECTION). 12 438 Q 13 Did - - I am concerned about the records which you had at the time in r e l a t i o n to the Lynbrett Trust? 14 A 15 439 Q 16 Well, I had no re co rds . So you have t o l d us. However, I am j u s t wondering had Craig Gardner any records? 17 A 18 440 Q 19 A 20 441 Q No. Would you ask them? I can ask them Chairman. Yes. Ask them did you supply them with any f i l e s or 21 correspondence th a t you had had about the 22 Lynbrett Trust? 23 A 24 442 Q 25 A Yes. I can, of course, Chairman. 26 443 Q Y es . Very good. 27 28 29 Yes . And you can get c op ie s fo r us i f th ey did? 50 NXQA 7 Seeva QQ Appendixzwm (13m I ^ O 'H yim Exhams & Partners Solicitors 58 South Mall, Cork. Telephone (021) 277788/271998 Facsimile (021) 272117 Email: ofexcorliflindigo.ie________ Our Ref: FOF/AOD/19391.011 Your Ref: Date 22nd March, 2000 Ms. Noreen Mackey B.L., Inspector’s Office, 3 rd Floor, Trident House, Blackrock, Co. Dublin. Re: Inspectors appointed by order o f The High Court to Ansbacher (Cayman) Limited Our client - Mr. Francis J. Boland, Famastack, Annmount, Glounthaune, Co. Cork ^ . ‘ '' -i- D ear Ms. Mackey, I am in receipt o f your letter o f the 6th inst. herein and I note the contents thereof. I refer to your letter o f the 10* January last and in particular to the lodgement o f the sum o f US$50,000 referred to in the penultimate paragraph thereof and the queries raised in the final paragraph in relation thereto. M y Client has no documentation whatsoever in his possession relating to the payment of the sum o f US$50,000. but he presumes that it was part o f an investment which he made in a US Property Venture in which he was a participant with Cornelius J. Collins, Clayton Love, Patrick J. Dineen and the late Hugh P. Covency. While my Client does not have any documentation relating to that transaction, I do have some documentation arising from the fact that this Firm represents the family o f the late Hugh P. Coveney. In January 1998, prior to his death, Mr Coveney had supplied a Statement on the US Property Venture to Ike Moriarty Tribunal. I have a copy o f this Statement in my possession and, with the permission o f the Coveney Family, I am authorised to make it available to you, I therefore enclose herewith the following documents:(1) (2) Memorandum US Property Venture (prepared by the late Hugh P. Coveney). Copy Lynbrett Trust Deed dated 22ntl May 1981. Frank O'Flynn Fachina O'Driscoll Rory W Collins ( s f lanspan international Consultants: Dublin Office: Peler Klrwan Danis P. Cahalan Jonathan While Brian W Russell A.C I Arb Michael A Bolger Brona McNamara Irene O'Qonovan MicheSi P. 6 MullSIn Eamonn P. Muldoon Cliona O’Rourke Nlall Cronin 17 Upper Pembroke S t , Dublin 2. Tel (01) 6311657 Fax (01) 6789549 Email: olexdubOindigo ie Richard Neville O’FIynn Exhams & Partners Our Ref: FOF/AOD The funding o f Mr Boland’s participation in this investment differed from that o f Mr Coveney. Mr Boland paid his share of the US$950,000 investment requirement from his own resources. While he never had any Bank Account with Guinness & Mahon, and has no recollection of ever paying any money to Guinness & Mahon* it is his belief that the lodgement or transfer o f US$50,000 referred to in your letter must have been part of his share o f the said required investment As to why the payment was made through Guinness & Mahon, Mr Boland presumes that he must have been requested to do so. Mr Boland states that he furnished full details o f the US Property Venture to the Revenue Commissioners many years ago in relation to his personal taxation affairs. I note from your letter of the 6th inst. that Mr Boland will be required to attend an interview with the Inspectors and I confirm that he will be available to do so subject to receipt of reasonable prior notice. I trust that the foregoing is the information you require. Yours sincerely, FRANK O’FLYN O’FLYNN EXHA WW 770289 Ge o r g e Town, Grant Caynan BY: . GUINNESS MAHON CAYMAN TRUST LIMITED A C a y m a n C o m p a n y w i t h its r e g i s t e r e d o f f i c e at Ge o r g e Town, Grand Cayman, British W e s t Indies W H E R E A S the s u m of U . S . D o l l a r s h a s b e e n t r a n s f e r r e d to t h e s a i d G u i n n e s s M a h o n Cavtnan T r u s t L i m i t e d t o t h e i n t e n t • t h a t ’i t s h a l l b e h e l d o n t h e t r u s t s h e r e i n a f t e r d e c l a r e d w h i c h shall b e k n o w n as the " L Y N B R E T T E " Trust. N O W T H I S DSHD W I T N E S S E T H as follows: . 1. I n this d e e d the following expressions shall have the following meanings:(i) " T h a Trustee'* m e a n s t h e s a i d G u i n n e s s M a h o n C a y m a n T r u s t L i m i t e d o r o t h e r the t r u s t e e o r t r u s t e e s f o r the t i m e b e i n g a f r o m t i m e to time hereof.* ‘ (ii) "The 3eneficiaries" means the persons spec i f i e d in the F i r s t Sche d u l e hereto. (iii) " T h e S c h e d u l e d Property'1 means the said sum of * (iv) " T h e T r u s t F u n d ” means: ' a) T h e Scheduled Property, • and b) A n y further or additional oroperty which a n y pe r s o n or persons may donate to or vest o r ’c a u s e t o b e v e s t e d i n t h e T r u s t e e to b e h e l d u o o n t h e t r u s t s a n d w i t h a n d s u b j e c t ic t h e o o w e r s a n d p r o v i s i o n s h e r e o f , and" c) T h e p r o p e r t y f o r the t i m e b a i n s ari° f r o m t i m e to t i m e r e p r e s e n t i n g t h e S c h e d u l e d Property and the further or additional o r o p e r t v (if a n v ) a f o r e s a i d . (v) " T h e P e r p e t u i t y ^ a t e " m e a n s t he d a y (a) or. w h i c h s h a l l e x c i r e chs p e r i o d o f Eii»htv y e a r s fror. c h e e x e c u t i o n o f t h i s D e e d , o r Cb > t h e d a y o n w h i c h s h a l l e x p i r e “h e p e r i o d o t w e n t y y e a r s f r o n c h e d e a t h o f C h e l a s t survf.var 770270 -7 ‘. o f al l d e s c e n d a n t s m a l e a n d f e m a l e o f K i n g G e o r g e • F i f t h l i v i n g on t h e da t e hereof ( w h i c h e v e r shall first o c c u r } , or ■ (c) s u c h e a r l i e r d a t e as the: T r u s t e e s h a l l a t its absolute d i s c r e t i o n by d e e d appoint. (vi) ’ 'Property" m e a n s real personal m o v a b l e o r im m o v a b l e p r o o e r t y ’o f a n y d e s c r i p t i o n a n d w h e r e s o e v e r s i t u a t e including policies cash and choses in action. (i) T h e T r u s t e e h e r e b y declares that the T r u s t e e will h o l d the T r u s t F u n d u o o n t h e t r u s t s a n d w i t h a n d subject to the powers and provisions hereinafter contained. ' (ii) T h e T r u s t e e s h a l l h a v e the r i g h t a t any t i m e d u r i n g t h e c o n t i n u a n c e o f t h e t r u s t h e r e b y c r e a t e d to a c c e p t s u c h a d d i t i o n a l p r o p e r t y as m a y b e d o n a t e d to s u c h t r u s t b y a n y p e r s o n o r p e r s o n s e i t h e r personally or by testamentary act or disposition. (i) T h e T r u s t e e s h a l l s t a n d o o s s e s s e d o f the c a p i t a l a n d income of the T r u s t Fund in trust for all or s u c n one o r m o r e e x c l usively of the others or other o f the B e n e f i c i a r i e s a t s u c h a g e o r t i n e o r r e s p e c t i v e a g e s o r t i m e s if m o r e t h a n o n e i n s u c h Shares a n d w i t h s u c h trusts for t h e i r resoectivs benefit a n d such provisions for their respective a d v a n c e m e n t m a i n t e n a n c e and e d u c a t i o n at the d i s c r e t i o n o f t h e T r u s t e e as the T r u s t e e s h all by any deed o r deeds revocable or irrevocable executed before the Perpetuity Date appoint. (ii) N o appointment shall be made revoked or r e v o c a b l e o n or a f t e r the P e r p e t u i t y Date. ’ (iii) A n y r e v o c a b l e a o n o i n t m e n t nay be m a d e or r e v o k e d b y t h e T r u s t e e f o r t h e tine b e i n g n o t w i t h s t a n d i n g t h a t the p e r s o n s w h o m a k e the. a p p o i n t m e n t a n d revo k e t h e a p p o i n t m e n t may n o t be o r include the same persons. (i) I n d e f a u l t o f a n d s u b j e c t to a n y stich appointment: as a f o r e s a i d t h e T r u s t e e m a y u n t i l the P e r p e t u i t y d a t e pa y o r a p p l y t h e w h o l e o r s u c h p a r t a s the Trustee shall ’ t h i n k f i t of t h e i n c o m e of t h e T r u s t F u n d as i t a r i s e s t o o r for t h e m a i n t e n a n c e e d u c a t i o n a d v a n c e m e n t o r b e n e f i t o f all o r s u c h o n e or m o r e of t h e B e n e f i c i a r i e s f o r the t i n e bein0 o f the Republic o f Ireland ^ 'tv \ \/K • < # y/, n AFFIDAVIT I, BARRY BRET BE& fei *• ■A •.f .,* * « -' •* * «,V m /* t s < 0 _r OATH and say as follows:-:^', (1) I am a director o f Hamilton Ross Co. Limited (“Hamilton Ross”) by which I am duly authorised to make this Affidavit in opposition to an application that Ansbacher (Cayman) Limited (“ACL’1) has made to this Honourable Court requesting a declaration under Sections 3(2)(b)(v) or, alternatively, a direction under Section 4 o f the Confidential Relationships (Preservation) Law (1995 Revision) (“the Law”) to divulge the confidential information set out in the Schedule to ACL’s Summons dated l sl February, 2001. Hamilton Ross has been served with notice o f ACL’s application. (2 ) I crave leave to refer to my Affidavit d a t e d ^ March, 2001 filed in this Cause on behalf o f . Poinciana Fund Limited and Worldwide Management and Consultancy Services Limited. On behalf o f Hamilton Ross, which has been served with the application, I adopt the reasons set out in that Affidavit as to why ACL’s application should be refused and add the farther reasons referred to below for such refusal. (3) As a preface, I have no idea whether the clients of Hamilton Ross have or have not paid Irish tax on their funds in the hands of Hamilton Ross nor do I know whether they are required to do so, but I am advised that it is against the public policy o f the Cayman Islands to assist a wide-ranging information gathering exercise which is aimed at enforcing the revenue laws o f another country and the more so when the person seeking the permission to make the disclosure is motivated in so doing by threats or by fear o f reprisals. It is on those bases that Hamilton Ross makes this further, objection to this application by ACL. (4) ACL admits in paragraph 2.6 o f the Affidavit o f John Bryan Bothwell dated 1st February, 2001 filed in this Cause (“the Bothwell Affidavit”) that the creditors) on whose behalf the Inspectors were to conduct the examination o f the affairs o f ACL to determine whether ACL had attempted to defraud any creditors either o f itself or any other person, were none other than the Irish Revenue. (5) Since it is clear that the disclosure o f the confidential information can only be used for the purpose o f assisting a foreign country to enforce its revenue laws and the enforcement itself has for many years, I am advised, been held to be against public policy, it follows that assisting in the disclosure, when those affected or who might be affected object, must equally be against Cayman Islands public policy even i f the person in possession o f the information were prepared voluntarily to give it up. . (6) In this case, ACL has admitted that it is prepared “voluntarily” to give up the information to the Inspectors purely as an appeasement measure in the hope that other pressures on ACL w ill be relieved. Indeed, in paragraph 4.2 o f the Bothwell Affidavit it is stated that “It has been suggested by the Inspectors that the Irish High Court could, at least in theory, act upon their report by making a winding up order in respect o f ACL o f its own. motion.” This can only reasonably be regarded in the context o f the circumstances set out in the Bothwell Affidavit, as a not too subtle threat with the clear objective o f bringing pressure to bear on ACL to give up the information or seek permission to do so. It surely must also be against Cayman Islands public policy to render assistance in those circumstances. (7) I am further advised that the pressure brought to bear on ACL as outlined above also constitutes a breach by the Inspectors o f Section 5(1 )(b) o f the Law for which criminal sanctions can be imposed. <8) For the further reasons appearing in this Affidavit, I respectfully request this Honourable Court to deny A C L ’s application. N o declaration under Section 3(2)(b)(v) nor any direction under Section 4 o f the Law should be made or given. S W O R N to at George Town, Grand ) Cayman this day o f March, ) N O T A R Y PUBLIC1 THIS AFFIDAVIT is filed by Myers & Alberga, whose address for s e rv ic e is One Regis Place, 90 Fort Street, P.O. Box 472, George Town, Grand Cayman B.W.I., attorneys-at-law for Hamilton Ross Co. Limited. I. .. I T IIIS D E C L A R A T IO N O F T R U S T is made the S V l day of T H E O R IG IN A L T R U S T E E _______ _ 199J3, B Y J W H E R E A S the Scheduled Property has been transferred to the Original Trustee to the intent that the Original Trustee must hold it on the trusts declared in this Declaration of Trust. y N O W T H IS D E E D W IT N E S S E S as follows:1. In this Declaration of Trust, unless inconsistent with the context or subject matter or circumstances: (1) "The Beneficiaries" means the persons specified in the First Schedule as amended from time to time in accordance with clause 2 and "Beneficiary" must be construed accordingly; (2) "The Original Trustee” means JO H N A N D R E W F U R Z E o f Ansbacher House, "■George Town, Grand Cayman, British West Indies. (3) "The Perpetuity Date" means the day on which the shortest o f the following periods expires:(a) The period ending on the hundredth anniversary of the date o f this Trust; or (b) The period o f twenty (20) years from the death of the last survivor qf all descendants male and female o f King George Sixth o f England living on the date o f this Trust; or (c) The period ending on such date as the Trustee appoints by deed. (4) "Property" means assets of every description wherever situate and includes real personal intangible, movable or immovable property o f every description and wherever situate and include investments, policies, cash and choses in action. (5) "The Protector" means JO H N A N T H O N Y C O L L IN S of Ansbacher House, George Town, Grand Cayman, British West Indies, or any successor (whether an individual or body corporate) appointed in accordance with clause 23. (6) "The Scheduled Property" means the property set out in the Second Schedule; (7) "This Trust" means the trust declared by this Deed which w ill be known as the POINC1ANA Trust; (8) "The Trust Fund" means:(a) The Scheduled Property, (b) Any further or additional Property which any person donates to or vests or causes to be vested in the Trustee to be held on the trusts and with and subject to the powers and provisions o f this Trust, and (c) The Property for the time being and from time to time representing the Scheduled Property and the further or additional Property (if any) referred to in sub-paragraph (b), and all accumulations of income and capital from time to time; . (9) t r u i l / a - t i / c m . c ib t c . p r o t "The Trustee" means the Original Trustee or any other trustee of this Trust for the time being and from time to time; l 3 0 (10) Words o f one gender include any oilier gender and singular words include the plural and vice versa. (11) "Person" includes a corporation. (12) A duly or obligation imposed is to be performed, and a povyer or discretion conferred is exercisable in each case, from time to time. (1) The Trustee D E C L A R E S that it holds and w ill manage the Trust Fund on the trusts and with and subject to the powers and provisions set out in this Deed. All land must be held on trust for sale with power to postpone sale. (2) The Trustee may at any time during the existence o f this Trust accept any additional Property which any person donates to the Trust Fund either personally or by w ill. (3) The Trustee may at any time by deed amend the First Schedule so as to add any person or class o f persons whatever now in existence or bom before the Perpetuity Date as a Reneficiary, and that person or class of persons w ill for all purposes become a Beneficiary as o f the date o f the deed, or such later date as the deed specifies. (4) The Trustee may likewise at any time by deed amend the First Schedule so as to exclude any person or class o f persons from being a Beneficiary as o f the date of the deed, or from such other date subsequent to the date o f the deed as is specified in it, but without prejudice to the Trustee's power to name that person or class o f persons to be a Beneficiary at a future dale. (1) The Trustee must hold all of the capital and income o f the Trust Fund in trust for all or such one or more exclusively o f the others or other of the Beneficiaries at such age or time or respective ages or times if more than one in such shares and with such trusts for their respective benefit and such provisions for their respective advancement, maintenance and education at the Trustee's discretion 'as the Trustee by any deed revocable or irrevocable executed before the Perpetuity Date appoints. (2) No appointment can. be made or be revoked or be revocable on or after the Perpetuity Date. . (3) The Trustee for the time being may make or revoke any revocable appointment notwithstanding that the person who makes the appointment and revokes the appointment may not be the same person. (1) In default o f and subjcct to any appointment made under clause 3, the Trustee may until the Perpetuity Date pay or apply the whole or such part as Ihe Trustee thinks fit of Ihe income of the Trust Fund as it arises to or for the maintenance, education, advancement or benefit of all or any one or more o f the Beneficiaries for the time being in existence in such proportions or manner as the Trustee in its discretion thinks fit. (2) Subject as set out in subclause (1), the Trustee must until the Perpetuity Date deal with the income of the Trust Fund or so much of it as is not paid or applied as set out in clauses 3 and 4(1), by accumulating it as an accretion to the capital of the Trust Fund. „ In default and subject to clauses 3 and 4, the Trustee must hold all of Ihe capital and income of the Trust Fund on trust for such of the Bcneficiaries as are in existence immediately before the Perpetuity Date, if more than one, in such shares as in its discretion it thinks fit or, if there is no such person, then on trust absolulely for any charitablc institution mentioned in Ihe Third Schedule. The Trustee may at ils discretion at any time pay or apply the whole or any part of the Trust Fund lo or for (he maintenance, education, advancement or benefit of all or any one nr more exclusively of the others or other of the Beneficiaries in such manner as the Trustee, in its discretion, thinks fit, without being liable to account for the exercise of that discretion, including purchasing an annuity for any One or more of Ibe Bcneficiaries. Notwithstanding any o f the trusts, powers and provisions in this Deed, the Trustee may at any time before the Perpetuity Date by deed, revocable or irrevocable, release any power, right or discretion under this Trust. > No benefit devolving 011 any Beneficiary under this Trust may form or constitute a portion of any communal or joint estate of that Beneficiary but that benefit wilt be and remain the sole, separate and exclusive property of that Beneficiary and, should any Beneficiary be married and lie subject to laws of community property, then any benefit so devolving w ill be expressly excluded from the community and, in the case of the Beneficiary being female, that benefit w ill also be free from the interference, control or marital power of any husband of that Beneficiary. In this clause, the word "benefit" includes Property and the provisions o f this clause apply not only lo the benefits actually devolving on any Beneficiary but also to the Property for the time being representing it and the income o f it. In addition to the powers vested in trustees by Jaw, the Trustee without the consent of any Beneficiary has and may exercise the following powers: (1 ) To retain any Property belonging to or forming part o f the Trust Fund in the actual stale or condition in which the Trustee receives it for so long as the Trustee thinks proper without being answerable for any loss occasioned by so retaining it. (2) To sell or otherwise dispose o f all or any Property at any time forming part of the Trust Fund in such manner by public auction or private contract and for such price in money or other consideration and on such terms and conditions as the Trustee thinks proper and to receive the consideration or price on such terms and conditions as the Trustee thinks Fit and give receipts for it. (3) To exercise all the voting powers attaching to any shares, stocks, debentures or other securities or notes at any time forming part of the Trust Fund. (4) To exchange Property for other Property of a like or different nature and for such consideration and on such terms and conditions as the Trustee considers advisable. (5) To compromise and settle for such consideration and 011 such terms and conditions as the Trustee considers advisable all matters arising in relation to this Trust or the Trust Fund and all those compromises and settlements w ill be binding on all the Beneficiaries. (6) To surrender and deliver up any securities or notes or other Property forming part of Hie Trust Fund, for such consideration and on such terms and conditions as the Trustee approves, to any company or corporation reducing its capital and the Trustee may receive that consideration in the form o f cash, securities or other assets as is agreed between the Trustee and that oilier company or corporation. • (7) To consent to any re-organisation or reconstruction of any company or corporation whose shares, indebtedness, notes or securities form part of the Trust Fund and lo consent to any reduction of capital or other dealings with those shares, securities, or other Property as the Trustee considers advantageous or desirable. ' (8) To invest or deal with any money forming part of the Trust Fund without regard to the provisions of any statute regulating trusts in any Property or business whatever (including hut not limited-lojhc purchase of any freehold or leasehold land with or without any house or other buildings on it or goods for the beneficial occupation, use or enjoyment of any Bcneficiary) on such personal credit with or without security and with or without interest as the Trustee in its discretion thinks fit, to the intent that the Trustee w ill have the same full and unrestricted power of dealing with and investing and varying investments and Property in all respects as a beneficial owner. < ) v '' (9) To make speculative investments if il thinks advisable without limitation by any "prudent man rule" or rule of reasonableness or any other statute or rule of law regarding investments by trustees and the making of those investments must not in any event be construed as a breach o f trust; and to open accounts, margin or otherwise, with brokerage firms, banks or others wherever in the world, to invest the funds o f the Trust Fund in, and to conduct, maintain and operate those accounts directly or through an agent for the purchase, sale and exchange of, commodities, slocks, bonds, notes anti other securities and in connection with so doing, to borrow or raise money, incur obligations, obtain and give guarantees and engage in all other activities nccessary for or incidental to conducting, maintaining and operating those accounts. (10) To pay out of the income or capital o f the Trust Fund all the costs o f and incidental to the preparation execution and stamping o f this Trust. (11) To determine whether any sums received or disbursed are on account of capital or income or partly on account of one and partly on account of the other and in what proportions, and the decisions o f the Trustee, whether made in writing or implied from its acts w ill he conclusivc and binding on all Beneficiaries. (12) To carry on any trade or business anywhere in the world whether alone or in partnership whether limited or general. (13) To lend the whole or any part o f the Trust Fund to any Beneficiary or any company referred to in subclause (20) o f this clause or any partnership referred to in subclause (12) of this clause and to appropriate and apply it or the income of it in securing (by any means however) any obligation of that Beneficiary, company, or partnership, or in guaranteeing or becoming surety for him on such terms as to repayment or otherwise and whether interest free or at interest and with or without security as the Trustee thinks fit. . (14) To be employed and remunerated or otherwise profit as a director or other off-cer or employee or as agent or adviser or otherwise however of any company or other corporation or undertaking or firm whatever at any time or in any way connected or dealing with the Trust Fund or in which the Trustee is in any way interested, or dealing with or acquiring any Properly from or selling or lelting any Property to tlie Trustee and to retain as ilsabsolutc property (and without being liable to account for it) any remuneration, fees or profits received by it in any such capacity notwithstanding that its appointment or office as that director, officer, employee, agent or adviser has been obtained or is held or retained in right or by means of its position as the Trustee or one o f the Trustees. (15) To enter into any indemnity in favour o f any former trustee or other person in respect of any contingent or prospective liability (including any tax, duty or other fiscal imposition) in respect of the Trust Fund or the income of it or otherwise in connection with this Trust and to apply the whole or any part of the Trust Fund or the income of it by way of mortgage, pledge or otherwise however as security for that indemnity. (16) (a) _ ft / V s lv * . . 7 ’ > . To employ and pay for such professional or other assistance as the Trustee thinks necessary in the discharge of its duties, including but not limited to lawyers, accountants, agents, advisers, managers and employees of any kind. , ' (b) To act on the opinion or advice of or information obtained from any financial adviser, lawyer, valuer, surveyor, broker, auctioneer, accountant or other expert or professional person, but so that the Trustee w ill not be responsible for any loss, depreciation or damage occasioned by acting or not acting in accordance with that opinion, advice, or information. i ' • (17) To determine all questions and matters of doubt which may arise fn the course of the management, administration, realisation, liquidation, partition or winding up of the Trust Fund. (18) To erect buildings on and make improvements to any Property forming part of the Trust Fund and also (o conduct farming operations on and lease all or any part of that Property. (19) To institute and defend legal proceedings and to proceed to the final end and determination of them or compromise them as the Trustee considers advisable. (20) To incorporate or acquire the shares of any company in any place in the world at the expense o f the Trust Fund with limited or unlimited liability for the purpose of, among other things, acquiring or holding the whole or any part of the Trust F_und; anti the consideration on the sale of the Trust Fund or any part of it to any company incorporated or acquired pursuant to this subclause may consist wholly or partly o f fully paid shares or debentures or debenture stock or other securities or notes o f the company and may be credited as fully paid and may be allotted to or otherwise vested in the Trustee and w ill be capital money in the Trustee’s hands. (21) To exercise or concur in exercising the voting and other rights attaching to any shares or securities for the time being forming part o f the Trust Fund so as to become a director or other officer or employee of any company or other entity and to be entitled to vote and to be paid and to retain for the Trustee’s use and benefit reasonable remuneration for those services. (22) To raise or borrow money on the security o f the Trust Fund or any part of it at any time and pay or apply the money so borrowed or raised in any manner which money forming part o f the capital of the Trust Fund may be paid or applied and to execute and deliver such security documentation for loans or indebtedness or other obligations as is required; and to give guarantees and indemnities and by any means to secure liability under them on the Trust Fund or any part o f it. (23) To deposit the securities, title deeds and other documents belonging or relating to this Trust for safe custody with any bank or trust company (including itsel0- (24) To hold any part o f the Trust Fund in the name of any nominee of the Trustee. (25) If income or capital becomes distributable to a minor Bcneficiary or to a Beneficiary under other legal disability or to a Beneficiary not adjudicated incompetent but who, because of illness or mental or physical disability, is in the Trustee’s opinion unable properly to administer that distribution, then the Trustee may pay that distribution in any one or more of llie following ways as it thinks best:- __ f t n n l/» - d /* \n » .c ib lc .p r o i * (a) directly to that Beneficiary; (b) to the legally appointed guardian or committee o f that Beneficiary; (c) to a parent or some relative or friend for the care and support and education o f that Beneficiary; or (d) ‘ by the Trustee applying those amounts directly for the benefit of that Beneficiary; and as regards (b) and (c). without having lo sec to the application of them and (lie receipt of any such person w ill constitute a full and final release and discharge of the Trustee. (26) If any incoinc, probate, estate or other duty, fee or tax becomes payable in the Cayman Islands or elsewhere in respect o f the Trust Fund or any j'iart of it on the death of any Beneficiary or otherwise, to pay at its discretion (but in the interest o f the Beneficiaries and the Trust R in d ) all or any part of that duty; fee or tax out of the Trust Fund with or without recourse against any Beneficiary or lo refuse to pay it or any par^ of it unless indemnified, and to determine the time and manner of the payment (if any). (27) Generally in relation to the Trust Fund to perforin all acts o f alienation, hypothecation and other acts of ownership to the same extent and with the same effect as Ihe Trustee might have done if it had been Ihc bcneficia! owner and the Trustee's decision and action, whether actually made or taken in writing or implied from the Trustee’s acts, w ill be conclusive and binding on all the Beneficiaries. — Notwithstanding any of the trusts, powers and provisions in this Deed, the Trustee may at any time before the Perpetuity Dale at its discretion by any irrevocable deed, appoint that the whole or any part of the Trust Fund must subsequently be held on the trusts and with and subject to Ihe powers and provisions o f any oilier trust (including this present provision) not infringing Ihe rule against perpetuities applicable to this Trust and approved by Ihe Trustee and in favour or for the benefit of all or any one or more exclusively of the other or others of the Beneficiaries. If it makes any such appointment, the Trustee may transfer to the trustee of that other trust Ihe Properly comprised in the appointment and then the trusts declared in this Deed concerning that Property w ill end and IliaC Properly w ill for all purposes be subject lo the trusts powers and provisions in that other trust and be subject lo and governed by the proper law of that other trust whether or not that proper law is the proper law of this Trust. Notwithstanding any of the trusts, powers and provisions in this Deed, the Trustee may at any lim e before the Perpetuity Dale by any irrevocable deed relire as Trusiee and with Ihe Protector’s written approval appoint a new trustee outside the Cayman Islands as Trustee o f this Trust On that appointment being made, the Trustee must immediately hold the Trust Fund on trust for the new trustee and must transfer it to the new trusiee as soon as possible. Subsequently, the rights of all persons and the construction and effect of every provision o f this Trust w ill be subject to the exclusive jurisdiction of and be construed only according to the law o f the country o f residence or incorporation o f the new trustee which w ill become the forum for the administration of this Trust unless any law, including any rule against perpetuities under that.law, would be infringed by the provisions of this Deed, in which event, although Ihc forum for Ihe administration of this Trust w ill have changed Ihe laws of Ihe Cayman Islands w ill continue to apply as provided by clause 22. If the Trusiee exercises its power under this clause, clauses 17 and 22 w ill take effect and be subject to the provisions o f this clause A N D the new trustee may by deed make such amendments to this Deed as are necessary to ensure that it is effective and legal in that new jurisdiction. The Trustee must keep accurate accounts o f its trusteeship and may have them audited annually at Ihe Trust’s expense as the Trustee determines, by an accountant or firm of accountants which the Trustee selects. The customary expenses in connection with Ihc administration of this Trust including the Trustee's remuneration and charges and ofthe investment of any part of the Trust Fund and the collection of income and other sums derivable from it must be charged in the first instance against the income of Ihe Trust Fund BUT if that is insufficient then against capital. The Trustee may, in its tliscrelion appropriate any part o f the Trust Fund in its actual stale or condition o f investment at the time o f appropriation in or towards satisfaction of any interest of any person in the Trust Fund as seems just and reasonable to the Trustee. (1) Any Trustee being a trust company or corporation is entitled to charge and be paid out o f the Trust Fund remuneration in accordance with its $cale of fees in force from lime to lime and may, as may its parent company or any subsidiary or any company in which its parent company is a shareholder, without accounting for any resultant profit, act as banker to and accept deposits from and perform any scrvicc for the Trust Fund on the same terms as it would make with any other customer. (2) Any Trustee being a lawyer, chartered accountant or other person engaged in any profession or business will be entitled to charge and be paid all usual professional and other charges for business transacted, time spent and acts done by him or any partner of his in connection with this Trust, including acts which a Trustee not being in any profession or business could have done personally. (3) Any Trustee may on behalf o f this Trust contract or deal with any person firm or body corporate with whom it is interested in any way whatever, directly or indirectly, without the Trustee or that person, firm or body corporate having to account for any resulting profit. - The Trustee need not give bond or security for the administration of the Trust Fund or for the discharge o f its duties arising under this Trust. (1). If there is a Protector, the power of appointing a new trustee o f this Trust w ill be vested in the Protector, but if there is no Protector, or failing an appointment by the Protector within fourteen days o f a written request from the Trustee to do so, that power w ill be vested in the Trustee or the personal representatives or the liquidator o f the last surviving Trustee, and that power w ill extend to the ‘appointment o f a new trustee in the place o f any Trustee resigning its trusteeship and also to the appointment of additional trustees up to any number subject to such lim it (if any) as is imposed by law. (2) Any Trustee may at any time resign the'trusteeship on giving not less than fourteen (14) days’ notice addressed to the other trustees (if any) or, if there are no other trustees, if a new trustee is appointed in the place o f the retiring Trustee, and the notice o f resignation w ill be taken to operate so as to vest all of the Property forming the Trust Fund in the continuing Trustee or the new trustee (as the case may be). (3) The office of a Trustee w ill ipso Jn clo end if that trustee, being an individual, is found to be a lunatic or .of unsound mind or if he becomes subject to any bankruptcy laws or, if that Trustee, being a company, enters into liquidation whether compulsory or voluntary (not being merely a voluntary liquidation for the purposes o f amalgamation or reconstruction). (4) Notices of all changes in the trusteeship must be endorsed on or attached to this Deed signed by the surviving or continuing Trustee, if any, and every notice w ill be sufficient evidence to any person having dealings with this Trust as to the facts to which it relates, and all notices of changes in the office of Protector must be dealt with and w ill with the necessary changes be evidenced in like manner. (5) Any person dealing with this Trust may rely on a copy o f this Deed and of the notices endorsed on it or attached to it, certified by the Trustee or the Trustee's lawyer before a Notary Public, to the same extent as it might rely on the original. (6) Unless there are fewer than three trustees of this Trust, the Trustee may act by majority vote. (1) • (2) . Every discretion or power conferred on llie Prolcclor by this Deed w ill be an absolute and uncontrolled discretion or power, and every discretion or power conferred on Ihe Trustee by this Deed or by law w ill, unless otherwise expressly stated to be subject lo the consent or control of (be Prolcclor, be an absolute and uncontrolled discretion or power, and no Trustee w ill be held liable for any loss or damage accruing as a result o f the Trustee’s concurring or refusing or failing lo concur in an exercise o f any discretion or power and, during any period that lliere is no Prolcclor, every discretion or power o f Ihe Trustee w ill l>c an absolute and uncontrolled discretion or power. No Trustee (notwithstanding tfiat it is a professional trustee) w ill be liable for any error of judgment or mistake o f law or other mistake or for anything E X C E P T the wilful misconduct or wilful breach of trust by that Trustee and except as set out in this sub-clause each Trustee and the directors, officers and employees of any coqwrntc trustee w ill liavc no liability whatever for and must be indemnified by Ihe Trust Fund against any claims, losses, death duties, taxes and impositions arising in connection with the Trust Fund or any part o f it. (1) The Trustee may at any time on such terms as it thinks fit, whether for a fixed period o f time or subject to a fixed period of notice or otherwise, and either in je la lio n lo the whole of the Trust Fund or to any part o f it as may for the time being be invested in any particular country or group o f countries, act as investment adviser or investment or jiortfolio manager or employ any person, firm, or company (including without prejudice lo the generality o f the provisions of this sub-clause any company being Ihe parent company or a'subsidiary company of the Trustee or any company under common control with or otherwise associated wilh the Trustee or any company in which the Trustee is in any way interested) as an investment adviser or investment or portfolio manager. (2) The Trustee may give an investment or portfolio manager power to operate a discretionary account. The Trustee may employ an investment or portfolio manager on terms that it may sell investments to and purchase investments from the Trust Fund, pool trust funds with those o f itself and other customers, and aggregate the Trust Fund’s transactions with those of itself and other customers so as lo average the cost o f sales and purchases over a period. (3) The Trustee may pay an investment adviser or investment or portfolio manager such fees, commission or other remuneration and such compensation for expenses as the Trustee in its discretion thinks fit, and the investment adviser or investment or portfolio manager w ill be entitled to retain for its own use and benefit any commissions or share of commissions customarily or by usage payable to it in relation lo any dealing or transaction with or concerning the Trust Fund or any part of it; AN D if the Trustee or any parent, subsidiary or associated or other company mentioned in this clausc acts as investment adviser or investment or portfolio manager, it is entitled to remuneration and commission and generally to act in accordance wilh its published terms and conditions in force from lim e to time for acting in that capacity. . (4) No Trustee w ill incur any liability or be in any way responsible for any loss which may be incurred as a result of negligence of the investment adviser or portfolio manager or anything done or not done as a result of any dealings o f or advice or recommendations given or purporting lo have been given by an investment adviser or investment or portfolio manager (whether in writing or by .cablegram or orally or by telephone or otherwise) or for any omission lo lake any action in Ihe absence or through nonreceipt of that advice or those recommendations from the investment adviser or investment or portfolio manager and so that, in particular but. without prejudice lo Ihe generality of Ihe provisions of this sub-clause, no Trustee w ill be liable for any failure to diversify the investment of Ihe Trust Fund or any part of il. The Trustee need not interfere with or lake any nctivc part in Ihe management or conduct of the business of any company wherever resident or incorporated in which Ihe Trust is interested although holding the whole or a majority of the shares carrying the control of the company, and so long as the Trustee has not notice o f any act of dishonesty or misappropriation of money on the part of the directors or employees having the management of the company the Tmstee may leave the conduct of its business (including the payment or non-payment of dividends) wholly to those directors or employees; and no Beneficiary under this Trust w ill be entitled to require the distribution o f any dividend ' hy any company wherever incorporated or resident in which the Trust may be interested or require the Trustee to exercise any powers he may have compelling any such distribution. 21. Every Trustee or Protector who is a befdy corporate may exercise or concur in exercising any discretion or power conferred on it by a resolution o f that body corporate or by a resolution o f its board of directors or governing body or may delegate the right and power to exercise or concur in exercising any such discretion or power to any one or more of its directors, officers or employees. 22. This Trust is established under the laws of the Cayman Islands and, if and so long as the powers in clause 11 have not been exercised, the rights o f all parties and the construction and effect o f every provision of this Trust is governed by and construed only according to the laws of the Cayman Islands, which is the forum for the administration o f this Trust. 23. (1) The Protector w ill automatically cease to be the Protector, if being an individual, he or she dies or is found to be a lunatic or o f unsound mind or becomes subject to any bankruptcy laws, or if that Protector, being a company, enters into liquidation whether compulsory or voluntary (not being m erely a voluntary liquidation for the purposes of amalgamation or reconstruction) or in either case if that Protector makes a valid appointment under sub-clause (2), or resigns. (2) The Protector may be deed and, if an individual, may also by w ill irrevocably appoint any other person to be Protector o f this Trust in his place. On the Trustee being given written notice o f the appointment and on the person appointed “ consenting in writing to act, that person w ill become the Protector, immediately if appointed by deed, or on the death o f the testator if appointed by W ill. (3) If notwithstanding the provisions of sub-clause (2), there is at any time no Protcctorof this Trust, the Trustee may by deed irrevocably appoint any person not being a Tmstee to be the Protector. 24. A Beneficiary o f this Trust may not alienate, encumber or hypothecate his interest in it, nor w ill the interest of any Beneficiary by subject to claims o f his creditors or be liable to attachment, execution or other process of law." A Beneficiary may. not pledge, assign, transfer, sell or in any manner whatever accelerate, anticipate or encumber the income or capital o f the Trust Fund, nor w ill any income or capital of the Trust Fund be in any manner subject or liable in the Trustee’s hands for the debts, contracts or liabilities o f any Beneficiary or be subject to any assignment or any other voluntary or involuntary alienation or disposition whatever before the Trustee distributes all or part o f that income or capital to the Beneficiary. . FIRST SCHEDULE 1. James Desmond Traynor, o f 134, Howth Road, D U B L IN 3, Ireland and his wife Dofeen Traynor; 2. Any child or grandchild of the said James Desmond Traynor and Dofeen Traynor. • SEC O N D S C H E D U L E The total issued equity and loan capital of the following companies incorporated under the laws of the Cayman Islands, British West Indies:POINCIANA FUND LIMITED HAMILTON ROSS CO. LIMITED WORLDWIDE MANAGEMENT & CONSULTANCY SERVICES LIMITED DUMAS'HOLDINGS LIMITED tntsl/a-il/dm.ciblc.pro! 9 3 -8 - f f l l R D SC H ED m .TT S S T " 1 ^ E X E C U T E D under SeaJ by Pu fppt^P in lhc presence of:- Witness A lnut/a-(l/dm.cjhtcpr0t C R 0 SS-C“ CTJ’ » • * ■ * * or « I B A R R Y B. B E N J A M I N 389 5" ~ c*’ “,n'B w 1 T” elca“ :- 345-949-6090 Fax;- 345-949-6097 June 22, 2001 Mr. Tony Traynor 79 Larchfield Station Road Dunboyne Co. Meath Ireland VIA email - tmact@qofree.indiao.ie (original to follow by post) Re: Poindana Trust Dear Tony, Please be advised that Poindana Trust has no current interest in Hamilton Ross Co. Limited or Dumas Holdings. Any previous holdings in the companies were disposed of by, John A. Furze MBE, my predecessor as Trustee. The Assets of the Trust remain substantially as stated in the information provided you in February 2001. The dedsion as to legal action in respect of Poindana Fund was taken solely on the advice of our Cayman Islands solidtor. Trust funds were used to cover legal expenses. Neither you nor any member of your family were, or need be, consulted as to the conduct of the affairs of the trust or in respect of any legal action. Hamilton Ross Co. Ltd. was a party to legal action undertaken by a separate firm of attorneys. No funds of Poindana Trust were utilized in the adion. If you require any additional assistance, I shall be pleased to be of service. Yours faithfully, Barry B. Benjamin was passed at a meeting o f the Board held o n is t h "Resolved that Irish Intercontinental Septenfaer 19 92 an<1 ha*

^'3 • 7:5— -3 C 0 :>;r;n>TMT! ai ; ha 3card c-f D irecto r October 20. 1SS2 0 ear Sirs: . W e have recently com pleted our examination of the consolidated financial statements of Ansbacher Limited (the 'C om pany") for tha period ended Septem ber 30, 1992. Tha purposa of this letter Ls to faring to your attention csrain matters which were encountered in the co u rse ai our work and to offer our com m ents and recommendations. T'nesa comments, by their nature, ara critical as they relate solely, to weaknesses and do not address the many strong features and controls within the Com pany's systems. The primary purpose of our examination was to enable us to form an opinion on the consolidated financial statem ents of An sb ach er Limited for the period ended Septem ber 30, 1992. W e reviewed and tested the Com pany's financial systems and related internal controls to the extent we considered necessary to evaluate the systems as required by International Standards on Auditing. Our study and evaluation wrth respect to these financial systems w as not designed for the purposa of expressing an opinion on internal controls and may not necessarily disclose all weaknesses in the systems. To facilitate your review and follow up, a summary of the major findings is presented in the following appendices: Appendix A-observations in the current period. . Appendix 8-fol!ow up to 1991 management letter. ' . The contents of this letter and the attached appendices have been discussed with the responsible management personnel and apply to the controls and procedures in existence during our examination. W e have not reviewed these items since October 9, 1992, the data of our auditors report. W e would be pleased to discuss our comments and recommendations with you and to assist you with implementation. W e would like to acknowledge the continued cooperation and assistance extended to us by the personnel of the Com pany during the course of our examination. Yours farthfulfy ' Km&tuvwA ■ KPMG Peat Warwick Resident Partners: c KX Fitrrt OI .5 b» A.M. 8 / Securities'Dept., / Guinness + Mahon Limited, 17 College Greenv / DUBLIN 2. ' 7th October, 1987. Dear Sir3r Many thanks for letting me have the envelope containing John Barrett's old Will from my dossier. Receipt enclosed herewith. I also enclose envelope marked ’John Barrett Letter cf Wishes' and would be grateful if you could put this in my dossier with the envelope marked 'John 3arrett - Will'. Many thanks. Yours faithfully, r * JDT/AJW Appendix-Vllw) T«L7MSS1/7N0M TWmcMMO FacaMHw 812035 1 9 LOWER PEMBROKE STREET, DUBLIN 2. M E M O R A N D U M Date: 3rd August 1988. Confirming Joan’s telephone conversation with you, I would be grateful if you could arrange to let me have: f'-fif.') t Ii*' \^rt> .fiL« n A U.S. Dollar Draf~ for US$2,400 payable to The Rental Connection, Maine, U.S.A. U.S.$500 in notes. Stg.£200 in cash. Each amount should be debited to G.M.C.T. No.2 Sub-Company Account. " J.D. Travnor. JDT/AJW £3tS Appendix-m - My Guinness Mahon Cayman Trust . The balance sheet of the company at 30 September 1982 is contained in Appendix 22. It shows that the Company had assets of £166 million at that date comprised mainly of liquid assets (£128 million). by the company amount to only £36 million. Advances As far as we are aware the bank conducts normal banking operations. It is a matter for consideration as to whether we should seek to verify this understanding. Prior to 1972 (when the Cayman Islands ceased to be part of the scheduled territories) funds were transferred from this country and placed in a discretionary trust of which Guinness Mahon Cayman Trust were the trustees (J.D. Traynor is a director of the company). The owner of these funds could then borrow from Guinness'S.Mahon Limited an amount equal to the value of the funds in the Cayman. The loan was secured by these funds. This security was formalised by the borrower signing a promissory note pledging the funds in the Cayman to the bank should the loan fall into arrears. The scheme had the obvious benefit for the depositor/borrower in that the deposit earned interest which was taxable at a low rate in the Cayman and the interest on the loan was allowable for tax in Ireland. The benefit to the bank is that a margin of 0.5 per cent, to 1.0 per cent, is earned on each loan with no risk attached. No funds have been transferred from this country to the Cayman Islands since 1972. As stated in Section 3(») loans secured in this manner amount to approximately £2 million. Summary of balance sheet at 30 September 1982 £'M Liquid assets Advances Other Costs 128.2 36.8 1. 6 166.6 Deposits Other Liabilities Capital and Reserves Ui6.6 The budgeted profit for 1982/83 is £800,000 before tax. Appendix Meeting held on 9 August in College Green, at 3.00pm. Attended by: Mr. D. Traynor Mr. M. O'Kelly Mr. D. McCleane Guinness & Mahon Mr. B. Daly Mr. N. Kennedy Central Bank Mr. Daly explained the purpose of the meeting which was to review the progress in the bank since the last inspection on the affairs of the bank at 30 April 1978. Mr. Daly said it was now the policy of the Bank to hold review swetings with the banks twice yearly, supplementing the detailed examinations which would take place every 2 to 3 years. He explained that these meetings were Intended to be a two-way process where the Bank would be informed of the state of affairs of the bank and also the bank would have an opportunity to air artyvlfcwsit might have. Kr. Daly said that since 1976 Guinness & Mahon Limited had received quit* a lot of attention in the Central Bank, mainly because of its lending to the property sector and also its shareholdings in companies to which it granted loans. As a result of this conditions were Imposed on the bank in Jure 1977 restricting these forms of lending. Mr. Traynor accepted that these steps were necessary and the conditions are being complied with. The bank was then discussed under the following headings 1. Capital Adequacy Mr. Daly said that the bank was adequately capitalised on a group basis having a free resources ratio at 30 April 1979 of 14.4 per cent. The capital employed to gross assets ratio of the Group was 5.6 per cent. As can be seen from Appendix 1, the operating profit of the bank has ' been increasing steadily since 1975. The actual profit before tax has fluctuated considerably due to provisions for bad debts and the sale of interests in subsidiary companies. Mr. Daljf.asked what the profit expectations for 1979/80 were. Mr. Traynor said that the bank had budgeted for a profit before tax of about £750,000, which was app­ roximately half of last year's figure. He explained the reason for this fall was due to high Interest rates, continuing increases in over­ heads, the loss of income on the dollar premium and the credit restrictions. He said that the credit policy restrictions would hit his bank as It had been the policy of his bank to keep advances at a low level since 1976. He hoped that his bank would be able to get some concession from the restrictions for this reason. The profits of the subsidiaries would be similar to 1978/79 and the ■ reduced profitability would be mainly due to a reduction in the parent bank, though it was expected that £100 - 150,000 of bad debts would be recovered. of £750,000). (Such recoveries are not included in the budgeted profit Concluding the discussion on profitability, Mr, Daly said that 1t was good prudential policy that bank profitishould grow and, with this In view, he felt that the Bank would be sympathetic towards any represen­ tations which were made by the bank on the credit policy issue. Loan Portfolio Hr. Daly said that the spread of risk in the loan portfolio was satis­ factory (see Appendix 2 ) and asked if there were any large loans 1n the Cayman Company. Hr. Traynor said that at 30 April 1979 the loans by the Cayman company totalled £4j million, of which £1J million was backed by deposits. He said the largest loan was £1.1 million. . He added that there was no plan to expand the loan portfolio in Cayman and that there were no loans to Irish companies or residents from Cayman. Mr. Daly then asked for some details on the larger loans by the bank (see Appendix 3). Hr. Daly asked if the bank envisaged issuing any preference share or t y p e s of loans are messy■ very competitive and, I n any case, the bank can attract sufficient of the normal banking loans without adverting . to these types. » 4 In reply to a query from Mr. Daly, Hr. Traynor said Ifhat the bank would seek to expand Its lending 1n the Agriculture and Service Industrial sectors. He said the most troublesome areas are the small manufacturing companies and labour intensive industries. 4. Deposit Portfolio Mr. Daly said he had no comment to make on the deposit portfolio which was in line with all the Bank's s t a n d a r d s S ). ' ' Liquidity Mr. Daly said that the liquidity ratio for the bank and group was over S o per cent, which was was as a result of the present curtailment on added that he would be view to discussing the 6. adequate. Mr. Traynor said that the high ratio bank's curb on lending in recent years and the lending due to the Bank's credit policy. He visiting the Bank’ s Banking Department with the credit policy In relation to his bank. Guinness Mahon Cayman Trust Limited . Mr. Daly asked Mr. Traynor to comment on the International activities of the company. Mr. Traynor said the bank had an "A" licence to do business in the Cayman Islands. It had a staff of 21. The bank's business Is mainly banking and trust management. Another Guinness Mahon company, Guinness Mahon Guernsey Limited,are the trustees of hun­ dreds of discretionary trusts, owning companies with registered offices in ijt J s J U I the Cayman Islands. Deposits from Irish residents aaeTplaced in the AnJt, name 0f one of these trusts which onlends to one of these companies /4s^ 7 * ^ . ln(j the funds are in turn deposited with the Cayman bank. The Cayman Bank redeposits these funds with tho Dublin bank which may give an ad­ vance to a customer (original depositor) secured hy these funds. Mr. Traynor said that there was little increase in activity in the Cayman company in the last few years and he did nbt.think it would grow any further. The meeting then concluded. Appendix VIII (a) Guinness Mahon London internal memo o f 1 May 1990 from Michael Whitmarsh to the Credit Committee entitled '‘G&M D ublin -Joh n Byrne Group Connection ’ (b) Guinness Mahon London internal memo dated 28 September 1989, same to same, and entitled ‘J. Turley connection - G&M Dublin ’ (c) Guinness Mahon London internal memo dated 11 June 1984 from Mr Traynor to Mr Pat O’Dwyer of Guinness & Mahon (d) Guinness Mahon London internal memo dated 18 December 1984 from Bruce Ursell to the directors o f GM London credit Committee GUINNESS MAHON & CO TO: DATE: FROM : Michael Whitmarsh Credit Control Dnit ay 1990 ( G&M DUBLIN 4 JOHN BYRNE GROUP CONNECTION The aiumcQ renewal for these "fully adequate" facilities was submjjbted to Credit Committee on the 24 April. Committee decided — fciizrt the proposal should be resubmitted with some further — s information, justifying renewals at the margins quoted. Committee will recall that this business has been with G&M for some years and was introduced and previously managed by Mr Des Traynor. Backing deposits are held at G&M Dublin in the name of Ansbacher Caymen Islands, but there is no supporting guarantee. Despite this, Dublin feel that the margin is satisfactory on these loans. They have other business generated from this source (loans, deposits and investment business) which is, or in the past, has been introduced by Mr Traynor and the Caymen association. The net worth of the John Byrne companies is in the region of £10 million and Jzhey^ r e very happy with the relationship. Total deposits with G&M from Ansbacher Caymen total some £35 million on which Dublin pay market rates. It is their view that they would have great difficulty in raising an amount of this size in the local market on the G&M name. Only sources ^^vailable for this size of money are the Irish clearers or large .nternational banks, all of whom appear to be making allocations j, to G&M from their Japanese country limits, which are well used. Renewal of these facilities is requested, though it should be noted that Dublin do have a letter from Mr Traynor stating that if any time the provision of these facilities causes embarrassment to G&M, he will undertake to place them elsewhere within 24 hours. Appendix $ ° \\ M K M O R A H D P H DATS: FROM: 28 September 1989 Michael Whitaarah Cradit control Unit: J TPMJPt CBMMECT10W - GfcM DOMOT Attached ara applications to Cradit committee approved by Dublin to firstly grant a now facility to Argus Leasing Limited, a now company formed by Mr Turley and, secondly, raarranga tha security on tha whole connaction. ■ The present limits to tha Group ara sat out on paga l of tha accompanying memoranda and total an expoaura of £450', 000 and these ara currently sacurad by "adequate" deposits vhich ara effectively under Dublin's control. Sha Committee will ba awara of tha background of such sacurity and tha fact that, in cartain casas, this say ba withdrawn in tha foreseeable future. This is ona such casa where tha. custoasr has baan informed that the Bank would prefar to have such arrangements conducted elsewhere, unless additional security could be provided. Mr Turlay wishes to maintain his relationship with Gut a&d has offered additional or substitute security to back his personal guarantee. This is a charge over three nodarn warehouse units which he owns personally, situated near Dublin airport. These are currently tenanted by Avis, Valley Ice-cream (the biggest ice-creaa distribution in Ireland) .and the third by an equally reputable covenant. Additionally, Dublin are offered a first floating charge ovar the assets of GBH plastics Limited to secure that company's borrowing. The property has baan informally valued by John Finnegan of Finnegan Menton at £550,000. Dublin have not insisted on a formal valuation at this stage as they feel that it is difficult to ask the customer (who wants to stay with them) to go to this expense when he had quite readily produced alternative security and they are still hold the adequacy which is currently valued at about £1-million. What we have therefore at the moment is additional security on w h i c h all the formalities have not been completed, but it does fulfill Dublin's requirement of relying less on the adequacy which may well be removed in due course. Whan this does happen they will require a formal valuation of tha property. T 5:3- g! A Wp?wa . arewuny - - 11:47,: . vlOwrr?.? I '3 {1'31} .044! r" . ,r It: :falxrg?m?k 3:127:?(4*":1er . 7" 1" v: ?7 if"? . .v . 1' 3" ?5'31; I inf-133Lg, ?nu-v guah ?3 - . A main-?43? if. ?g'f'w?xg? )4 a ?o 3' ply-"4. . "(?r?hhlj?yg?L33: Enid?? a. f. I EEC. r?k- "35.5, J- . ?rugg't-JLuna) ??riu .mw? ?,ij I ?pry. .3315m. 9'4 Hl>l.3-?ygfr?gt" . .. 5 yaw-i4, (311gag)?, ML r. fraud a. r? a ""9251: If" 5&.H?w - mtm?rr??f? 45; an? ?Za?mwn - . L?f?wank; 191;?" '1519?FW-rw-a . 431??" i. 3- A 4 1r Q?vg?g 'v A Ng-r . a a - [v.1 . . .1123'34$953333: 53gin ?9-5 7" 23551-4 1 .Jx' I - . mas-1h 53-41g, 3? 4:331yaPg?v Kigali?:- K-l 5 i?r? Mani} Fayrg-?Bmgr . . I ,1 - I . 311?? - 61135Ur; an?, 7 ?Kik???Wm. m1 . 3? a. (hfhw. . ?5 _1 Wk 25it; .er ?gfigrt, L. ?4?3 a".an t? 7? whd??@5513:- 5.5. - (m 5? ?air?" ?Wig ?35% 3 . 4m?51! - ?33.x - :r-?r9755. ?Ah . A . wvgw?w' - #32. . . gaff". R?i'hi?f; •MfliJl S'. MEMUHANlJtlM .IH IN ft CO I 11> JGlli Ui li:l l{.) , 1*>04 You h a v e roooivf'd Hr iii’i • Ur:.i... I I a copy of i Ik * Had and Ikml'fH: .i.l IH.*t»I.u Committee report as part <>L •ho year ind -iccount.imj process. You will also hnve noted thcil cho repori is somewhat more detailed 1:h.j;i :in previous years, r would like, in addition, to draw your attention particularly to the following items: I have drawn these situations to your attention as it. is usually the practice to value collateral . and compare with outstandings where a loan is made to a single purpose company without outside guarantees. In these cases if we did not have significant contingency reserves available we would have to review the level of specific reserve. This is the view also taken by our auditors, who in addition feel our carrying value of Bourdon and the unreserved portion of Barry Business Systems can only be: justified by the comfort of our contingency position. 7 i /cont 'd Guinness Mahon I8th l'U'ceiubci , I'J8<1 Finally, I would draw your attention to the comments on the Caymans. No details of individual locins were provided from Grand Cayman. The Committee agree that in view of the small size of the loan book, to accept the assurance of RDF on the working methods and his own look at the portfolio. I have nol. , myscl T, .my ilcIa iI of Ihi1 C.'iym.in lo;in portfolio for a considerable number ot years. 'J’h<‘ bulk of them are cash backed, but there are a number of risk items, which I am assured by Des Traynor are all clean. I bring this to your attention simply because there has not been an 'independent' look at the portfolio since RDF's visit eight months ago. I will in the course of the next two months ensure that full details are made available to me. If there is any need to revise the recommended position on Cayman, I will inform you when I have made the examination, but I have no reason to suspect there will be any need to change this recommendation. Appendix Internal Henry Ansbacher memorandum dated 5 June 1992 ANSBACHER INTERNATIONAL TRUST GROUP LIMITED INTERNAL MEMORANDUM To: P. J. Greenhalgh From: K. McAuiiffa Data: 5t}\ June, 195)2 Subject: ' DUBLIN I have amended yct-ir draft nota of 1st June, 1992, and attach a revised version ' which I think is more reDresentaiive or the situation. " kma/jap AtL 0 S -io o -ia a < i liffi 7l39ilat 7 1 3 S 8S ANS3ACHES CC. I.) LTD. 35. GS. 92^5^41 \ \ NOTE TO PILE 1 JUNE 1992 ANSBACHER LIMITED DUBLIN ACCOUNTS _ On 1 June 19921 spoke to Kevin McAuliffe who tald me that whilst he was in Dublin in May, 199^, he had, at the invitation of Des Traynor taken a brief (approximately 1 hour) look at the "Dublin" accoimto, which are'memorandum accounts only, As the review had been on an ad hoc basis no written report had been prepared. Points emerging from the discussion with KMcA were:­ - the book-keeping System appeared to be satisfactory and is maintained on a PC with back-'up computer data kept off-site. - KMcA did not reconcile the records against Cayman's figures, however, these have been reconciled monthly as a matter of course since January, 1991. - KMcA suggested that the difficulty in reconciling the position originally reported by Peats was resolved circa January 1991, and ih lt an aduiticrial check was carried out by John Furze when he visits Dublin each September to review the underlying trust records. . Appendix XI (a) Memorandum account A/A30 for 1988 and 1989 (b) Memo o f Richard Fenhalls 16 September 1992 (c) Examples of early 1991 instructions to IIB about the Ansbacher accounts (d) Letter o f application to open Hamilton Ross accounts in IIB (e) Memorandum account A/A30 statements for 1995 and 1996 B / C 0 5 / 4 1/ 2 5 0 5 0 0 DESCRIPTION CALL DATE P lP i,‘ j I T L C U " U L . n A/C PARTICULARS VALUE DATE DEBIT 3 ID l C a7 0 4 JA N 8 0 SUALA.\Cc L ^ U U u H r FQi J A ft 0 « CREDIT BALANCE \ 3,6 77.40 3.677.40 1 * 0 0 0 .GO I 2 5.00 4.677.40 '+,80.? «40 B / C 0 5 /4 1/250500 DESCRIPTION c A L L 'H .P jS iT OATE VALUE DATE PARTICULARS ? 9 Fi_B 8 8 =b A L A . ' i r . t UMARU8 1‘j M ARUO .U O u F O -bOj CJ iiT . A P ^ L IF u -•jD..fr ... n M A P .il 8 L t U U t K A/C L^ L U o HI 10 i OivWA ■-» CALL D l Pw S I T PARTICULARS DATE 3 U JU N a 8 ly jL Y B ^ A/C f tuAL AriCi. LUDL,!::.. L-RUIJoHT VALUE DATE PO, CURRENCY d e s c r ip t io n j Tl ^ L I l a l l h G n tP ij^ iy DATE Vw 2 9 J l y an * ^ A L A \ C _ 20JLY68 LdOJTO 3 1 Ao Gtr) l oHo ro­ a / LEDGER c VALUE DATE PARTICULARS ijR U U O H I DEBIT acco unt n u m ber STATEMENT DATE nuOOl J 8 o J I AUG 88 CREDIT FO .iW A »u l » O O O . 00 12i»* 00 BALANCE 8 » 8 LI ■>40 9* 8 11 . 4 0 9,936.40 ll IIUO "v»«« 1 d e sc rip tio n CALL DLPUS1 T A/C PARTICULARS DATE 3 1 A0 GO 8 ❖ i.'ALAwCL 3 0 S L P f a a LiJOoPD IN T. liPIJI.’ GHl APPLir-U TO VALUE DATE FOrlWARu 30 ^u PQR ninLTaf DEBIT 80 1?7 7? - SIATEMENT DATE .5 0 8 8 CREDIT BALANCE 9,936.40 125.00 249.11 10.31061 CURRENCY DESCRIPTION .ALL D u Pu SiT LEDGER A/C AVtOUMl ivUiVtUutl STATEMENT DATE -11 0 - T 8 8 --- ---- --VALUE DATE PARTICULARS DATE *L'-Ai_ A . j C - ..R Q IJU U DEBIT CREDIT l - O K W A '^ 1,000.00 l.?5.00 030uTb8 Lj OGFw ? iO v , T f a O L'j Po R* i BALANCE 10 » 310 o 51 l l » 3 1 0 o r>l 11 , 4 3 5 . 5 1 t t i : DESCRIPTION CALL L L U U fc S i .•JuPusir A/C PARTICULARS DATE 3io:raa «=JALAir.l 3 D ML) V 08 LL)9 L»- u uR-UCHT VALUE DATE DEBIT HO k WARJ • / *' 82 '30n1v88 CREDIT BALANCE 125.00 111435.51 11,550,51 > DESCRIPTION L A LL DuP-jStT DATE Ju'l-VcJ-* S.JALA-C.. Cu » L I T o' .. I «t . a p - A/C PARTICULARS '' vJI' •.( 111 l ; 1j in VALUE DATE i f.xWvt'* .. jin -r «•' ■' I J A ' I O ,; DEBIT 83 500': Lad BALANCE 12509? 337.53' _n a. . [19?350'51 12903-5?33 1 DATE PARTICULARS 3un uC {j'*. * : , A „ •* i C . ? J P i . C d 't U r*o ' .• ! ' ij i. io i 'i VALUE DATE i n DEBIT JIJAN89 CREDIT BALANCE - I t: 3 3 13 q23.3J 85 gr: STATEMENT DATE ?1 9 .. DESCRIPTION LALL . . DATE PARTICULARS VALUE DATE DEBIT CREDIT BALANCE U) gnur u? ?310d3o_: 13,273.33? a CC. d esc r ipt io n l a l L O u -PJSiT A/C . st a t em en t d a t e 3 lrtA R 8 9 ■ -\ PARTICULARS DATE 2 b F l;B u 9 0LMAR89 3 1 MAR b9 ^ALA. ;C: - u P O U O H l I k i j TLi l O u L ’J O 'a E ^ I N T . A P P L I E D TO I L ' I m R o Q VALUE DATE DEBIT CREDIT ' v -• 3L3.30 L2 5 .0 0 ,41 3.0 6 0LAP«d9 ■' — • . BALANCE 13.273*33 L 2 ,95 9.9 7 : • 13,493.03 1 : • d es c r ipt io n C A L L L pJ DATE r» L T A 1 / C PARTICULARS VALUE DATE DEBIT CREDIT BALANCE \ • W 3 1 M A V_-' R G 9 A R U 9 L C . M v o A L A „C i- : jP lJU u H T F O i i W A R O 1 «\ A L J Q D R A , r . ' 0 3 A P R 0 9 LODGED 2 0 A P R 8 9 L *■■ A * . 0 0 1 -lJ I i L' O D u C . . » , w O • I t , ) i t 0 0 0 . 0 0 1 2 5 . 0 0 ^ i ‘ / 1 t ■' 1 3 * 4 9 3 . 0 3 1 3 * 3 9 8 . 0 3 1 4 , 3 9 8 . 0 3 1 4 » 5 2 3 „ 0 3 . > 1 DESCRIPTION- CAL L DEPOSIT OATE PARTICULARS 31 M A Y 89 30MAX89 DALAKCE EBCDGHT FORWARD LODGED STATEMENT DATE VALUE DATE DEBIT ^ "] • CREDIT 8 CJ \ BALANCE' 'w' 125.00 NODB /' 1 4 / 5 2 3 , 0 3 ir J 14,648.03 ■I / BROUGHT FORWARD '>/>'•'> •»)/ i./f.I'J .'30/ 6 /0 9 l MU/ 6//J9 3 0 / 6/flQ I ill o r e a: I Io il 1/ 89 - ?60.53 -. - ' 'i i/ (i/U>) tV / 7 / m /' ' U m 19/ 7/69 1 BROUGHT FORWARD Lo d g ? il ____________________________ . 15233.61 l25.00 O: in Iii-1.31? ?7 15358. 61 .1 1y?? 11/ 3/39 CARRIED FORWARD 125.00 15483.61 no. 9 . - '’/ty.! 15/ 9 /0 9 10/ <1/0 9 U)/ <)/»'» V 7 / 9/1)9 3 0 / 9/89 3 0 / 9 /8 9 1 B / C 0 5 / 4 1/ 2 5 0 5 0 0 j.oili'r d Lodgfid Intftrest to 30/ 9/119 15AH4.61 16733.61 125.00 16858.61 529.13 17387.74 4) i/JU / . / IV/I'»/H*J il/iii/ii-i 2/J0/U9 19/JU/09 31/10/09 31/10/09 J2rjl).UU lr 2V.J l.mluc! !oilj'i .1 II.;:'1 ■: f ■r■, .. ^,?l' ; '■'*■'':'.■;-" ■*'■ Letter of Application fur the O p rninj of Accounts by Incorporate Hodir* Full Title of Com pany (Block Capitals) HRMUjTON BOSS 0 0 . LP C H E D VJtlrega uf Registered Officc (Bioek Capitals) 'ANSBACHER HG31BE, P .O . B@K 887, GRAND QGOffiN, B . W . I . TO: Irish Intercontinental Dank Limited \ Date: 1 8 th SEPTEMBER 1992 \ Gentlemen, M y Directors request you to open and/or continue one or more account(s) is the name or the ahm v-m eiiiKtriccI C v m p u n y In piirtiianiv; n f this request I hand you herewith:- I. Certified Copy of a Resolution of the Board of Directors regulating the conduct of the noMuni(x), irigeihAt with specimens of the signatures of the authorised sif natures. Th«« C opy R evolution o v erlea f must be c o m p lffn l anrisigned by a D irector and the Secretary or by t*-o Directors. Specim en signatures o f all authorised signatories must hr affived overleaf. II»M I M n ita N I I N I N T A l M M ! lIM ffTI) • * t »»«••**««• H f M t t . MJM.IN > • l U W I B H I . t l « H I H ■ M O M U *1 M M *-« aa*tl*tM •* •*«*•«•« MtMMI **««« • Y tlU . ) J ] t t We certify (hat the following Resolution of the Beard o f Directors of Hadrilton Boss Co. T.-irm^n^ was passed ai a meeting of the Board held o n l8 th Septem ber19 ?? and ha» b«*n duly “ Resolved that Irish Intercontinental Bank Limited be and is hereby jequested to open and/or continue one or more aeeount(s) in the name of the Company and that the said Beak be and is lieieby authorised to honour all cheques, bills of exchange, promissory notes and other negotiable instruments expressed to be drawn, signed, aeeepted or made on behalf of the Company and to act on any instructions relating to the aecount(s), affairs or transaction* o f the Company notwithstanding that such action may cause such «ccount(a) to be overdrawn or any overdraft thereon to be increased (but without prejudice to the (HAMILTON ROSS 30/04/95 05/05/95 05/05/95 35/05/95 05/05/95 35/05/95 05/05/95 31/05/95 23/05/95 31/05/95 23/05/95 31/05/95 23/05/95 31/05/95 ' 31/05/95 31/05/95 23/05/95 31/05/95 i._______ n BROUQHTFORWARD TEL CHGS ACL IR 5000 TO N02 A/C ACCESS 750 COSGROVE TRAVEL TEL CHGS ACL TEL CHGS ACL TEL CHGS ACL D KELLY , ACCOUNT NUMBER 8000X386 PAGE BALANCES SHOWN ARE IN: s te rlin g 5165.00 774.75 1488.18 3468.00 123.34 29 289565.22 283748.81 123.34 109.75 124.36 279150.08 .. .............. jS a h i l t o n ROSS _J L. >170Q/93 16/06/93 36/06/95 06/06/95 30/06/95 30/06/95 06/06/93 06/06/95 06/06/95 30/06/95 30/06/95 ’ BROUGHT FORWARD REV ENTRY REV ENTRY ACL' Interest to 30/06/95 T/CHQS ACCOUNTNUMBER 80001386 PAGE BA1ANCE8 SHOWN AREJN: sterling 30 279150.08 109.75 123.34 2000.00 280916.99 2020.00 282398.93 6 amiILTOH ROSS u 31/07/95 29/08/95 31/08/95 ^ ... ...... _ j 18/08/95 ' BROUGHT FORWARD 182000 ACCOUNT NUMBER 80001386 PAGE bAlances shown are in: sterling 1943.90 31 282398.93 280455.03 . ---------- STATEMENT OF ACCOUNT ••*-' =r“ &S~'.til rv*'•r>vV^ * % " C'J r ^W c f«.^ '-J ■'>*■*;^> -V_ - BOSS (HAMILTON ham: ^ l _ ^ ^~ “ *-■'> w %- > : ' >- 31/08/95 BROUGHTFORWARD. 29/09/95 29/09/95 CASH 1000 29/09/9529/09/95 254.91 F GLENNON ' 30/09/95 30/09/95 Interest to 30/09/95 V- r^ -'- © 6 9 © 0 ’ ~S «• 'V -V>'^'K' -0?.f■ Vr.Tv-»• -'r‘,V'*^- 30/09/95 CARRIED FORWARD 75.). I, rig; . I SHAMILTON am3 ROSS L. 30/09/95 04/10/95 04/10/95 31/10/95 - j 04/10/95 04/10/95 31/10/95 BROUGHTFORWARD COL MUT IB2000 REFUND DINNER EXP ACCOUKT NUMBER 80001386 PAGE BALANCES SHOWN ARE IN; s te rlin g 33 282716.12 98.68 2040.00 280577.44 350.00 [Vii . Mm . y BOSS (HAMILTON hami L. 30/11/95 31/12/95 31/12/95 BROUGHTFORWARD Interest to 31/12/95 t• © i. 31/12/95 & CARRIED FORWARD A/A30 ACCOUNTNUMBER 80001386 PAGE BAUNCES SHOWN ARE IN: s te rlin g UALfMsCE. 31/12/95 08/01/96 18/01/96 18/01/96 18/01/96 18/01/96 08/01/96 18/01/96 18/01/96 18/01/96 18/01/96 BROUGHTFORWARD IIB DINNER IS600 ARNOTTS 895 IR1000 . LODGED 624.00 930.00 1040.00 300.00 5000.00 282387.94 282687.94 35 1' .m 1 ?93? Iht erest t0-31/03/96 Jere?yi-ai31354.9.1?3w c" OUNT In? :10 ,k {5 ?Wax, 74 9+ TS k:ILTON ROSS n ; l _ ACCOUNTNUMBER „ 30/04/96 30/04/96 80001386 BgOUGHTFORWARD 30/04/96 30/04/96 TFR ACL. PUTS 55000.00 12000.00 !• PAGE 38 .\ tc T / S T A T E M E N T OF AC'CQUN' (HAM HAMILTON BOSS “ 1 A/A30 L _ ACCOUNTNUMBER 80001386 PAGE s berljjn g 30/04/96 09/05/96 31/05/96 31/05/96 ' 22/04/96 23/05/96 23/05/96 BROUGHTFORWARD ACL APB IEP5000 ACL 5200.00 1000.00 1000.00 355641.59 356641.59 'V .'ft'i 1f E •.''A Ijjf STATEMENT OF ACCOUNT BOSS SHAMILTON w L. 31/05/96 24/06/96 24/06/96 30/06/96 1 _ j 24/06/96 24/06/96 30/06/96 BROUGHTFORWARD IEP5000 ACL JUNE Interest to 30/06/96 : ACCOUNTNUMBER BALANCESi WQflt3B6 PAGE 40 352441.59 < 5190.00 L000.00 348251.59 ^ham HAMILTON : KOSS 31/07/96 12/08/96 31/08/96 31/08 /9 6 > »- -- 01/08/96 20/08/96 n : BROUGHTFORWARD JLY JJC. CARRIED FORWARD ACCOUNT NUMBER 80001386 PAGE BALANCES SHOWN ARE IN; s te rlin g 1000.00 352393.74 353393.74 1000.00 352393.74 41 HAMILTON BOSS ( ham ~ r L. 31/08/96 04/09/96 04/09/96 30/09/96 ' 04/09/96 28/08/96 30/09/96 BROUGHT FORWARD COL MUTUAL « AUG Interest to 30/09/96 30/09/96 CARRIED FORWARD ACCOUNT NUMBER 80001386 PAGE BALANCES SHOWN AHE IN: sterling 98.68 42 352393.74 353295.06 357742.95 --------- __j HAMILTON BOSS n * ACCOUNTNUMBER 30/09/96 02/10/96 80001386 43 357742.95 BROUGHTFORWARD 26/09/96 •SEPT PAGE 1000.00 STATEMENT OF ACCOUNT ^HAMILTON ham: ROSS A/A30 L_ 31/10/96 04/11/96 15/11/96 © ACCOUNTNUMBER 80001386 PAGE BALANCES SHOWN ARE IN: s te rlin g ; BROUGHTFORWARD 04/11/96 OCT 15/11/96 A$50000 30/11/96 CARRIED FORWARD 1000.00 44 358742.95 359742.95 335933.42 ,. --------------- ---------------- il .j ©l [HAM] HAMILTON BOSS A/A30 l _ 30/11/96 31/12/96 31/12/96 31/12/96 31/12/96 31/12/96 _ j ' 31/12/96 31/12/96 16/12/96 30/09/96 31/12/96 ACCOUNT NUMBER 80001386 PAGE BALANCESSHOWN ARE IN; sterl*"ff BROUGHTFORWARD Interest to 31/12/96 NOV DEC Int. Adjust. toXXXXXXXX IEP5000 45 335933.42 lOOOjMf 1000.00 0.54 5025.00 • - '-- U'\ ,. i . <->V!\.; r*X'j ’• .: • ’ W. •^£-^;:r,iv'VvX'-v "t'-VV-'/.r' - -•. •-vtr. ‘ f v V X ^ ' ^^ -’'i"> * *'.rf'i-v;< •*> >•—.f -(tn';v -^ :> v11-:/."'.V *' .*.'•: *'v* •’: ;•■'•''• :" ''' *’JK ^ ' p n ,A 9 ••*•> ■ .• *r~ .A^-w10 t t."i ;::'';■;' i:v :• '■. ■-. i' $ v'.-ri ••V*,r.V;'?V v «i vT7~y- 31/12/96 Sk» CARRIED FORWARD 337289.94 '4 & 4$ M ‘.«S - 03g 2-m- agar}: may 9' . "iv Nun-?2?, 4-. ?5-35- - WEEK - . 3.59:; 1? jar) .- ?rFs?sfw?-V {fr . 5 4:3:{wr?357 ACOOUNTNUMBER 00001386 PAGE 1.6 mammamz sterling unzwx 337289.94 1 . v, .l . 338269.915 :5 [ti- -. . {n Appendix XII (a) Transcript o f evidence o f Mr Jack Stakelum given to the Inspectors on 8 November 2000 (b) Transcript o f evidence o f Mr Jack Stakelum given to the Inspectors on 6 December 2000 Append-ix Km?) UNDER OATH ON WEDNESDAY, 8T H N O V E M B E R 2 0 0 0 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO M R . ROWAN FCA MS. M A C K E Y BL So l i c i t o r to the I ns pe ct or s MS. M. C U M M I N S Interviewee: MR. JACK STAKELUM A c c o m p a n i e d by: MR. KARL HAYES GORE & GRIMES SOLICITORS CAVENDISH HOUSE SMITHFIELD DUBLIN 7 1 T H E I N T E R V I E W W I T H MR. 2 ON WEDNESDAY, STAKELUM C O M M ENCED AS FOLLOWS 8 T H N O V E M B E R 2 000: 3 4 MR. JUSTICE COSTELLO 5 Mr. Stakelum, we will s t a r t o u r i n t e r v i e w now. 6 I will introduce the inspectors. 7 I am Declan Costello. 8 a n d Mr. 9 be e n ap p o i n t e d inspectors by the High Court. Ms. M a c k e y is o n m y r i g h t R o w a n is o n m y l e ft. As you k now we have 10 is a n i n t e r v i e w a n d I s h o u l d e x p l a i n , 11 t h a t it w i l l b e u n d e r oat h . 12 s o l i c i t o r i n a m o m e n t to a d m i n i s t e r t h e o a t h to you. 13 B u t i f d u r i n g t h e i n t e r v i e w w e a s k y o u q u e s t i o n s on 14 w hich you w o u l d like legal advice, 15 w h o e v e r is a s k i n g y o u t h e q u e s t i o n s -- a n d w e w i l l 16 stop and you can consult with your solicitor. 17 Similarly, 18 t h a t he s h o u l d g i v e you l egal a d v i c e on an y 19 question, 20 a n d h e c a n t h e n d i s c u s s t h e m a t t e r w i t h you. 21 22 23 24 25 26 27 28 29 Mr. This Stakelum, I will ask our p l e a s e t e l l us - ­ s h o u l d y o u r s o l i c i t o r t h i n k it p r o p e r h e c a n i n d i c a t e to us t h a t w e s h o u l d s t o p 1 MR. JACK STAKELUM, 2 A S F O L L O W S B Y MR. H A V I N G B E E N SW O R N , WAS EXAMINED COSTELLO: 3 4 MR. JUSTICE COSTELLO 5 Mr. Stakelum, regretfully we on l y r e c e i v e d y e s t e r d a y 6 i n t h e m i d d l e o f t h e m o r n i n g y o u r l e t t e r of 7 6 t h N o v e m b e r i n r e p l y to o u r l e t t e r , 8 correspondence. 9 can not a d e q u a t e l y complete the i n t e r v i e w this 10 m o r n i n g b e c a u s e a num be r of m a t t e r s have to be 11 i n v e s t i g a t e d b y us b e f o r e w e c o n t i n u e a s k i n g y o u 12 questions, 13 this 14 correspondence. 15 to m a k e s o m e p r o g r e s s t h i s m o r n i n g a n d t h e n to 16 a d j o u r n o u r i n t e r v i e w to p e r h a p s n o t n e x t w e e k b u t 17 the w e e k after, our previous U n f o r t u n a t e l y t h i s m e a n s t h a t we m a t t e r s w h i c h h a v e b e e n r a i s e d b o t h in l e t t e r t h a t w e go t y e s t e r d a y a n d i n t h e e a r l i e r W hat I w o u l d hope to do w o u l d be if we c o u l d f i n d a s u i t a b l e date. 18 19 W h a t I p r o p o s e to do, Mr. 20 t r y to get some g e n e r a l m a t t e r s c l a r i f i e d a b out y o u r 21 career and your association with Guinness 22 h e r e in Ireland, 23 w h a t h e l p y o u c a n g i v e us a b o u t t h e s e r v i c e s w h i c h 24 A n s b a c h e r g a v e to c l i e n t s o f y o u r s h e r e i n I r e l a n d 25 or w h a t y o u m a y k n o w a b o u t t h e s e r v i c e s . 26 as y o u know, 27 H i g h C o u r t t o d o is to i n v e s t i g a t e t h e a f f a i r s of 28 Ansbacher. 29 like to as k you some f u r t h e r q u e s t i o n s a b o u t a a n d Mr. Stakelum, n o w is j u s t to & Mahon T r a y n o r in particular, and Because what we are r e q u i r e d b y the T h a t h a v i n g b e e n done, we w o u l d then 1 c o u p l e o f t h e d e t a i l e d m a t t e r s t h a t w e w r o t e to y o u 2 about: 3 affairs. 4 background information, 5 w o u l d n ' t m i n d g i v i n g it to us. 6 y o u r c a r e e r as an a c c o u n t a n t , 7 o u t l i n e it f o r us. 8 A. 9 Ms. B a n o t t i ' s a f f a i r s a n d Mr. Keane's I w o u l d l i k e to s t a r t w i t h s o m e g e n e r a l Mr. Stakelum, if y o u F i r s t of a l l a b o u t if y o u c o u l d b r i e f l y I c o m m e n c e d t r a i n i n g as a n a r t i c l e d c l e r k w i t h a firm c a l l e d B o l a n d O ' D o w d but t he y br ok e up and I 10 t r a n s f e r r e d t o H a u g h e y B o l a n d & C o i n or a b o u t 11 I t h i n k l a t e 1956. 12 Mr. 13 I q u a l i f i e d i n t h e m e a n t i m e a n d r e j o i n e d t h e m in 14 1 9 62. 15 t h e f i rm. 16 l e f t H a u g h e y B o l a n d & Co in 1 9 7 0 or 1 9 7 1 a n d j o i n e d 17 Guinness 18 own c o n s u l t a n c y company, 19 w h i c h is w h e r e 20 I c l o s e d t h e o f f i c e a n d le t t h e c o m p a n y r u n d o w n in 21 1 9 98. 22 1 Q. 23 24 Traynor. T h a t is w h e r e I w o u l d h a v e m e t I l e f t H a u g h e y B o l a n d i n 1958. At that s t a g e Mr. T r a y n o r w a s a p a r t n e r in T h e n I b e c a m e a p a r t n e r i n 1967. & Mahon. I l e f t in l a t e He 1975 to f o r m m y B u s i n e s s E n t e r p r i s e s Ltd, I operated until I semi-retired; I o p e r a t e a f e w c l i e n t s f r o m h o m e now. C o u l d y o u t e l l m e a b o u t t h e n a t u r e of t h e b u s i n e s s t h a t y o u s t a r t e d in 17, A. 1956, T h at's right. 17, C l y d e Road, is t h a t r i g h t ? Clyde R oa d was m y o ffice until 25 c l o s e d t h a t i n O c t o b e r 1998. 26 all the time a fter lea vi ng H a u g h e y Boland, 27 didn't operate 28 financial consultancy company whereby I provided 29 financial s e r v i c e s to c l i e n t s , I I operated from there f r o m a n y w h e r e els e . so I That was a s o m e t i m e s b e i n g on 1 t he ir b o a r d of directors, more times not depending 2 o n w h a t t h e w i s h e s of t h e c l i e n t s w e r e a n d w h a t w a s 3 suitable 4 h a v e b e e n i n v o l v e d in t h e f i n a n c i a l 5 w i t h b a n k s a n d a r r a n g i n g sh o r t , 6 loans. 7 B u t s o m e c l i e n t s w o u l d h a v e y o u d o a l o t of w o r k fo r 8 t h e m a n d m o r e a lo t l e ss. 9 i n t e r v i e w i n g for re p l a c e m e n t for the occasion. M o s t of t h e w o r k w o u l d field dealing medium and long-term Monitoring their financial requirements. Some w o u l d include s t a f f i n v o l v i n g y o u in 10 t h e n o r m a l d a y - t o - d a y b u s i n e s s d e c i s i o n s of t h e 11 company. 12 s p e c i f i c n e e d s a r o s e in c o n n e c t i o n w i t h b a n k i n g . 13 M o s t l y banking. 14 2 Q. 15 A. O t h e r s w o u l d n ' t r e q u i r e you, You had two companies, only when is t h a t r i g h t ? T h e r e is s o m e c o n f u s i o n a b o u t tha t . Business 16 Enterprises Ltd was the ma i n company. 17 c o m p a n y c a l l e d B E L S e c r e t a r i a l Ltd. 18 the ini ti als of b u s i n e s s en terprises. 19 provide 20 h a v e b e e n a p p o i n t e d s e c r e t a r y to s o m e c o m p a n i e s b u t 21 it n e v e r f u n c t i o n e d in t h e s e n s e t h a t it 22 never...(INTERJECTION). 23 3 Q. 24 A. 25 4 Q. secretarial We had a The " B E L " is T h a t w a s to s e r v i c e s to c o m p a n i e s . It m a y The m a i n one was Busin es s E n t e r p r i s e s Ltd? Absolutely, yes. Y ou were d i r e c t o r of this company. Did you have 26 a n y b o d y e l s e i n t h e c o m p a n y w i t h y o u as a f e l l o w 27 director? 28 29 A. I ha d one co l l e a g u e wi t h me from the time I st ar t e d up to about 1986 a nd t hen I got another. 1 5 Q d i d h e o w n p a r t of t h e e q u i t y of the c o m p a n y ? 2 3 W h e n you say a colleague, A No, I t h i n k we o nl y had two shares issued. 4 w r o n g a b o u t tha t, 5 issued, 6 of the w h o l e l o t . 7 6 Q 8 A 9 7 Q but I m a y be t h e r e m i g h t h a v e b e e n a 100 s h a r e s I w o u l d have b e e n the b e n e f i c i a l owner Of the w ho le 100? Yes . W h e n you say you had a colleague, is t h a t j u s t 10 s o m e b o d y w h o m e r e l y a c t e d as a d i r e c t o r t o c o m e to 11 the b o a r d of d i re cto rs m e e t i n g s ? 12 A No, h e w o u l d h a v e w o r k e d w i t h me. O r i g i n a l l y it w a s 13 a n a s s i s t a n t t h a t w a s w i t h m e in H a u g h e y B o l a n d & Co 14 t h a t c a m e w i t h m e at t h e tim e . 15 8 Q 16 A 17 9 Q What was his name? J o s e p h Seely. He w o u l d h a v e left about 1986. He w o u l d h a v e b e e n 18 replaced. Then I would have recruited another 19 colleague f r o m w h a t w a s H a u g h e y B o l a n d & C o or 20 Deloitte 21 10 Q 22 A 23 11 Q 24 A 25 12 Q 27 A 28 13 Q 29 What was his name? Ian Murray. We r e th e y on the p ay r o l l of the c ompany? T h a t ' s right. So t h a t i n fact, company, 26 & Touche? it r e a l l y w a s v i r t u a l l y a o n e - m a n it w a s y o u r c o m p a n y ? Th at's right. You had one assistant, later? Mr. S e e l y a n d Mr. Murray 1 A 2 14 Q 3 A 4 15 Q 5 6 Th at's right. What s t a f f d i d y o u h a v e as w e l l ? The o n ly o ther one was a secretary. Can you give me the names of the se cr et a r i e s that you employed? A M y o w n s e c r e t a r y is Ms. A n n V e r d o n . She w o u l d be 7 w i t h m e 30 y e a r s . 8 B o l a n d & C o a n d c a m e w i t h me. 9 b a c k there w o u l d be an extra yo un g e r girl but She was w it h me in H a u g h e y At stages 10 w o u l d be s t r u g g l i n g to r e m e m b e r names. 11 have changed periodically. 12 16 Q 13 A 14 17 Q further I They would T h e m a i n p e r s o n w a s Ms. V e r d o n ? T h a t ' s right, yes. I w a n t you to be a l i t t l e m o r e e x p l i c i t a b out y o u r 15 business. 16 c a r r y o u t a n y a c c o u n t a n c y w o r k fo r y o u r c l i e n t s . 17 Did you audit their books 18 A No. D i d y o u ac t as a n a c c o u n t a n t . Did you for ex ample? I w o u l d n ' t h a v e b e e n in p r a c t i c e as a n a u d i t o r 19 at t h a t s t a g e . 20 assignments 21 I t h i n k i n t h e s e n s e of a c c o u n t a n c y , 22 There w o u l d have b e e n some things w h e r e b y we w o u l d 23 have operated the payroll 24 p r i n c i p a l l y w a s to p r e s e r v e c o n f i d e n t i a l i t y f o r t h e 25 c l i e n t f r o m staff. 26 so t o t h a t e x t e n t w e w o u l d h a v e b e e n d o i n g 27 accounting. 28 18 Q 29 A There would have been different c a r r i e d ou t f o r d i f f e r e n t c l i e n t s . ve r y little. for clients, which We w ould have o p erated payroll, B u t y o u d i d n ' t a c t as a u d i t o r ? 1 19 Q 2 A No, I wouldn't know a n y t h i n g about tax really. 3 I was n e ve r a tax a dv i s e r and n ev er an auditor. 4 M y f u n c t i o n w a s m o s t l y in t h e f i n a n c e a r e a w i t h 5 banks and then general business. 6 20 Q 7 A 9 21 Q A Raising loans and organising loans and organising Yes, for y our clients? that's right. Providing whatever was needed to t h e b a n k s . 12 22 Q 14 15 T h a t ' s right. securities 10 13 was that r a i s i n g m o n e y for your cl ients? 8 11 B e i n g in the finan ci al area about banks, The banks w o u l d re qu ire s e c u r i t y for loans and you w e r e i n v o l v e d in that? A Yes, t hat's right. I w o u l d be i n v o l v e d in t alk i n g 16 to t h e b a n k s a n d o f f e r i n g w h a t s e c u r i t y w o u l d b e 17 a v a i l a b l e t o t h e b a n k s in c o n n e c t i o n w i t h lo a n s . 18 23 Q 19 A 20 24 Q It w o u l d b e a n i n t e g r a l p a r t o f y o u r w o r k ? Absolutely. W h e n Mr. T r aynor left the b a n k and left 21 Haug h e y Boland and went 22 b e f o r e that a d i r e c t o r of Gui nn ess 23 or a m I w r o n g i n that, 24 A full-time, he h a d b e e n & Mahon Ireland b e f o r e he left full- tim e? I d o n ' t a c t u a l l y k n o w tha t . I k n o w t h a t he w a s 25 d o i n g a lot of w o r k for the b a n k in c o n n e c t i o n w i t h 26 c e r t a i n l y t h e i r c l i e n t s b e f o r e he l e f t 27 H a u g h e y B o l a n d & Co t o j o i n the m . 28 w h e t h e r h e w a s a d i r e c t o r o r not. 29 Do y o u k n o w t h a t w h e n h e j o i n e d t h e m he b e c a m e C h i e f 9 I don't know 1 Executive. 2 Chief Executive? 3 A t t h e t i m e t h a t he j o i n e d t h e r e w a s J o h n G u i n n e s s 4 in the b a n k and W i l l i a m Forwood. 5 something, 6 John Guinness Chairman. I'm not sure who would 7 h a v e b e e n j o i n t w i t h him, but maybe W i l l i a m Forwood. 8 26 Q 9 He was V i c e C h a i r m a n an d He b e c a m e j o i n t like joint m a n a g i n g director and pro b a b l y Y o u w e r e d e s c r i b e d in t h e M c C r a c k e n r e p o r t as a close personal f r i e n d o f Mr. Traynor's, correct? 10 11 A 12 27 Q 13 A 14 28 Q Me? Yes ? Yes, v e r y close. W o u l d h e h a v e t o l d y o u a b o u t t h e e s t a b l i s h m e n t of 15 the offshore companies that Guinness 16 i n v o l v e d in? 17 is t h a t A I w o u l d have b e c o m e aware; & Mahon were I wouldn't necessarily 18 k n o w w h a t t h e s t r u c t u r e m i g h t be. 19 a l m o s t that he w o u l d be t e l l i n g me that. 20 c e r t a i n l y a w a r e t h a t he w a s i n v o l v e d w i t h C a y m a n . 21 29 Q 22 A It w o u l d n ' t b e But I was Tell me what you understood? I a m n o t s u r e w h a t d a t e s o r s t a g e s he w o u l d h a v e 23 been very involved with the Cayman islands. 24 C e r t a i n l y at s t a g e s he u s e d to b e g o i n g o u t to 25 C a y m a n t h r e e o r f o u r t i m e s a yea r . 26 m e t at o n e s t a g e s o c i a l l y J o h n F u r z e a n d 27 John Collins. 28 I w o u l d h a v e m e t t h e m p r o b a b l y at d i n n e r in 29 Mr. I would have T he y w o u l d h ave come to Ireland. Traynor's house. I am not sure what else I 1 2 It is n o t a q u e s t i o n of w h a t y o u m i g h t h a v e 3 understood, 4 what you knew about the operations 5 in the C a y m a n I s l a n d s ? 6 A Mr. Stakelum, I j u s t w a n t y o u t o t e l l us of t h e s u b s i d i a r y I a m n o t s u r e h o w to a n s w e r t h a t u n d e r o a t h in t h e 7 s e n s e o f t e l l i n g w h a t t h e t r u t h is or w h a t I w o u l d 8 be imagining. 9 31 Q Do y o u r b e s t , Mr. Stakelum. Tell me what you know 10 about the c o m p a n y that was e s t a b l i s h e d in the 11 Cay m a n Islands, 12 What 13 A 14 32 Q 15 A the subsidiary, a n d w h a t it did. s e r v i c e s d i d it s u p p l y ? A l o t is w h a t I a m r e a d i n g in t h e p a p e r s . Tell me what you know? I guess there was a c o m p a n y e s t a b l i s h e d in the 16 C a y m a n Islands that w o u l d have dealt from an Irish 17 p o i n t of v i e w w i t h o f f s h o r e mo n i e s . 18 w h e t h e r t h a t w a s a s u b s i d i a r y o f D u b l i n or w h e t h e r 19 it w a s a s u b s i d i a r y of L o n d o n . 20 o n e s t a g e t h a t it w a s o n e w a y a n d t h e n it m o v e d t h e 21 other w a y for w h a t e v e r inte rn al r easons Gu in n e s s 22 M a h o n w o u l d h a v e had. 23 33 Q 24 Have you difficulty, I don't know I h a v e a f e e l i n g at for example, & in kn ow i n g that discretionary trusts were established? 25 A 26 34 Q 27 Well, they probably were but M y q u e s t i o n is, I . . . (INTERJECTION). did you know that they established discretionary trusts? 28 A 29 35 Q No, I w o u l d n ' t h a v e kn o w n . Is t h i s t h e f i r s t t i m e y o u h a v e l e a r n e d of it, 11 from me? 1 2 A 3 36 Q 4 A I w o u l d suspect that they have from reading papers. Tell me what you suspected? I suspected that p r obably trusts were arranged, but 5 I don't know whether they would have been arranged 6 i n D u b l i n a n d o p e r a t e d f r o m C a y m a n or o p e r a t e d f r o m 7 ...(INTERJECTION). 8 37 Q 9 A 10 38 Q Who w ould have been the trustee? I didn't operate any trusts. I a m a s k i n g y o u w h a t y o u r k n o w l e d g e is of t h e 11 company. 12 Mr. 13 A 14 15 Stakelum? I know that t here was G u i n ne ss M a h o n C a y m a n Trust a n d it l a t e r b e c a m e k n o w n as A n s b a c h e r . 39 Q 16 17 Do y o u k n o w t h e n a m e of t h e c o m p a n y , L e t us d e a l w i t h G u i n n e s s M a h o n C a y m a n T r u s t . Do y o u k n o w w h a t t h a t c o m p a n y d i d ? A 18 It w a s a b a n k p r i m a r i l y . a n d I p r e s u m e it w o u l d t a k e d e p o s i t s . 19 40 Q 20 A It t o o k d e p o s i t s , yes? I p r e s u m e it d i d t h e n o r m a l b a n k i n g t h i n g a b o u t 21 making loans. 22 dealings with t h a t . 23 I p r e s u m e d it w a s a b a n k 41 Q But I w o u l d have h a d no direct I a m c o m i n g t o t h a t la t e r , Mr. Stakelum. I want you 24 t o t e l l m e b e c a u s e we h a v e to r e p o r t t o t h e c o u r t 25 a b o u t t h e a f f a i r s o f G u i n n e s s M a h o n C a y m a n Tr u s t . 26 Y o u t h i n k it w a s a b a n k a n d it t o o k d e p o s i t s . 27 y o u k n o w a n y t h i n g e l s e a b o u t it? 28 I know that John Furze and John Collins were 29 directors o f it. I think they were executive Do 1 directors. 2 42 Q. 3 A. 4 43 Q. 5 A. 6 44 Q. 7 A. I am asking you what it did, Mr. Stakelum? I haven't specific knowledge, Mr. Costello. You haven't got specific knowledge? No. General knowledge? From general knowledge I assume it did what banks 8 did: 9 loans. 10 45 Q. Take deposits, make loans, take securities for You are telling me something about trusts? I am not, I want to find out what you know. Do you 11 not know that it carried on a business of managing 12 trusts ? 13 A. 14 4 6 Q. 15 Did you know that Guinness Mahon Cayman Trust Ltd acted as trustee and managed trusts? 16 A. 17 47 Q. 18 A. 19 48 Q. No. You didn't? I don't know that, I suspect that. You suspect it. When did you first suspect that was so? 20 21 No, I don't know specifically. A. That is very hard to answer. I suppose from 22 discussions back over the years with Mr. Traynor, 23 I would have assumed. 24 49 Q. 25 26 Why would you have assumed it, would he not have told you? A. He may have but there would be no reason for him to 27 come along and say 'Jack, we are operating trusts in 28 the Caymans.' 29 50 Q. You learned from him that he operated trusts in the 1 2 Cayman Islands? A 3 that those things happened. 4 51 Q 5 A 6 52 Q 7 8 From general conversation with Mr. Traynor? Yes . That would be when it was founded in the early 1970's? A 9 I presume sometime like that. I don't know when they started operating trusts from or anything like 10 11 It might be from general conversation I would glean that, so I don't know. 53 Q Try to listen to the question and try to be clear in 12 your answer so far as you can. 13 when you first knew that Guinness Mahon Cayman Trust 14 carried on a trust management business? 15 A 16 17 I am asking you I don't know the answer to that question; it would be information that you might assimilate. 54 Q 18 When did you first know that it carried on this business? 19 A 20 55 Q 21 A 22 56 Q I would love to help you with an answer. Well try. Was it early 1970's? Probably sometime in the 1970's. So you knew sometime in the 1970's that there was a 23 company called Guinness Mahon Cayman Trust. 24 you know that Mr. Traynor was the Chairman of it? 25 A I don't think at that stage, but I would have known that he was Chairman much later on. 26 27 57 Q 28 A 29 Did When was that? I don't know that. But at one stage they sold out in Cayman to somebody and I think Mr. Traynor 1 finished up with some small percentage. 2 I understood that he was asked to stay on and he 3 became Chairman for a period of time. 4 Are you saying that you didn't know he was Chairman 5 until the company sold the shares and he stayed on. 6 Are you saying that before that happened in 1988 -­ 7 you didn't know that he was Chairman of the company? 8 A 9 10 answer I can give to that. 59 Q 11 12 A 60 Q A Did you know that he was associated with the company Very much so. He used to travel frequently out there. 61 Q 19 Why would he do that if he wasn't associated on the board of directors in some way? 20 A 21 62 Q 22 A 23 You asked me was he Chairman. He was on the board of directors you think? I don't know if I knew that but I may have known that. 24 63 Q 25 A 26 64 Q 27 A 28 65 Q 29 He may have but I have no recollection of that. in Cayman? 17 18 Did he not tell you that he I have no recollection of that. 15 16 I wonder why that is. was Chairman? 13 14 I don't know whether I knew or not, that is the only You knew that he was closely associated? Very closely associated with it. From the very beginning? From the very beginning of what? We are sparring, Mr. Stakelum. are sparring. Yourself and myself I was just wondering if I could lead 1 you to tell me what you know about Mr. Traynor's 2 involvement so that we won't spar. 3 answer me, frankly this is going to be a long 4 interview. 5 A. 6 66 Q. 7 A. 8 9 Please tell me what you know? I want to help. Then help me. Mr. Traynor left Haughey Boland in 1970 or 1971. He was very involved with Guinness & Mahon. 67 Q. 10 11 If you don't Just pause there: He was very involved with Guinness & Mahon? A. Yes, he was very involved just before he left, and 12 then he left. After he left, I don't know when he 13 got involved with Cayman or formed Cayman. 14 I suspect from reading a lot that he took a major 15 initiative maybe in the formation of 16 Guinness Mahon Cayman Trust. 17 became aware of that. 18 matter how close we were he wouldn't discuss his 19 business things with me where they wouldn't have any 20 interest for me. 21 aware that he was very involved with Cayman. 22 used to travel there a lot. 23 went on the Board or when he became Chairman. 24 I am aware he was Chairman in the later days. 25 I cannot answer you about when I became aware he was 26 Chairman because I just don't remember. 27 can I say about that? 28 became involved. 29 Guinness Mahon started in 1971, 1972, 1973, 1974, I don't know when I Mr. Traynor wasn't likely, no Obviously over the years I became He I don't know when he What else I cannot remember when he I wouldn't know whether 1 2 68 Q. 3 A. No particular date but early in the 1970 's? Yes, in the 1970's I presume is when he got involved 4 with Guinness & Mahon. 5 that he got involved with Cayman. 6 69 Q. So I presume sometime after At the time you left did you talk to Mr. Traynor 7 about it. 8 in your professional life. 9 him? 10 A. 11 70 Q. 12 13 Did you discuss it with Yes, as a friend I would have. Did he indicate to you that as a friend he would try to help you? A. 14 15 Did you discuss this very major change No, that would have been my decision. My leaving Haughey Boland arose from a difference of opinion. 71 Q. I am not asking you about that at all. I don't 16 want to go into your private affairs. 17 know, did Mr. Traynor suggest to you that he would 18 be able to help you, put business your way? 19 A. 20 72 Q. 21 No, and he didn't ever. Did you say to him that you would be in touch with him, that you would like his assistance? 22 A. 23 73 Q. 24 A. 25 74 Q. 26 27 I want to No. You didn't? No. But in fact you did get his assistance for clients of yours? A. Not specifically because I went out on my own 28 though, I was getting his assistance before I left 29 Haughey Boland & Co and would have continued after. 1 But that would have been the same kind of assistance 2 I would have got from people in AIB except that he 3 was closer to me and I knew him better. 4 75 Q. Very well. You knew then that he was closely 5 associated. 6 he held in the company. 7 Trust, you knew that it was a bank and you knew that 8 it was involved in establishing trusts. 9 know that the trusts it established were 10 You didn't know what particular office With Guinness Mahon Cayman Did you discretionary trusts? 11 A. 12 7 6 Q. That is not my language at all. Did you know; did you hear that. It might not be 13 your language -- it is lawyer's language -- but did 14 you know that they were discretionary trusts? 15 A. I don't know whether you are telling me that all the 16 trusts that Guinness Mahon were involved in were 17 discretionary trusts. 18 of all kinds. 19 77 Q. 20 Do you know the difference between a discretionary trust and an ordinary trust? 21 A. 22 78 Q. 23 It gives discretion to the trustees. In that they have absolute discretion to do what they like with the trust funds? 24 A. 25 79 Q. 26 A. 27 80 Q. 28 29 I presume there were trusts That is a bit out of my league. Have you come across it? I have heard it before. Have any of your clients ever had discretionary trusts ? A. I don't think so. The only things I might know is 1 if they died or something and there would be letters 2 of wishes with discretionary trusts. 3 came across a few of those. 4 81 Q 5 A 6 82 Q I probably Did you yourself ever have one? No. In relation to the activities of Guinness & Mahon 7 and the establishment of Guinness Mahon Cayman 8 Trust, do you know that Guinness & Mahon and 9 Mr. Traynor in particular then established 10 subsidiaries in the Channel Islands to do the same 11 work as Guinness Mahon Cayman Trust had been doing 12 in the Cayman Islands? 13 A I don't know that he established them but I would 14 have met somebody from a company called "Sovereign 15 something" at a golf outing of Guinness & Mahon 16 sometime and there was some connection with 17 Guinness & Mahon, but I am not too sure what it 18 ...(INTERJECTION). 19 83 Q Are you telling me, Mr. Stakelum, that Mr. Traynor 20 did not tell you that they had established 21 subsidiaries in the Channel Islands? 22 A 23 24 I am telling you that I am not aware that he certainly told me that specifically. 84 Q You either remember it or you don't remember it. 25 Do you remember Mr. Traynor telling you that they 26 established...(INTERJECTION)? 27 A 28 85 Q 29 A As clear as that I don't remember. Did you learn it subsequently? I don't know about the subsidiaries. 19 Subsidiary has 1 a connotation to me as an accountant that somebody 2 owns something. 3 subsidiaries in the Channel Islands. 4 that they had connections in the Channel Islands. 5 86 Q 6 A I don't know whether they owned But I am aware What were the connections? There was the thing that is mentioned of 7 College Trustees. 8 your documentation that...(INTERJECTION). 9 87 Q Let us be clear. 10 College Trustees. 11 that? 12 A 13 88 Q 14 We sent you particulars of Had you never heard of it before I had heard the name College Trustees. Let us get back to that; that is what we are talking about? 15 A 16 89 Q 17 A 18 90 Q 19 20 I am not sure that I read it in I am not aware that it was a subsidiary. It was an association? Yes . Guinness & Mahon had an association with Channel Islands? A 21 Absolutely I would have been aware of that because I would have used the facility. 22 91 Q 23 A 24 What facility would you have used? I referred to it in my notes to you in connection with Gerry Keane. 25 92 Q 26 A What facility would you have used? Guinness & Mahon provided a company for me from I 27 presume Guernsey for the use of Mr. Keane, so they 28 obviously had a connection. 29 93 Q Then you knew about it? 1 A 2 3 Yes. I don't know what subsidiary it is. I knew there was a connection. 94 Q Tell me then what you knew about the connections 4 that Guinness & Mahon Ireland and Mr. Traynor had in 5 the Channel Islands? 6 A In connection with Mr. Keane at a stage where he 7 wished to purchase a residency and where he had no 8 facility or borrowing capacity at the time but had 9 some funds abroad, I advised him if he wished to 10 maintain the confidentiality. 11 to use a foreign company. 12 95 Q 13 A 14 And the only way was Where did he have the funds? He had the funds placed with me and in turn I had placed them with Mr. Traynor. 15 96 Q 16 A Where were they then? I don't know that but I always suspected until 17 proceedings arose in recent times that they were in 18 Cayman but I am not sure of that now. 19 97 Q Mr. Keane gave you funds. You gave them to 20 Mr. Traynor. 21 thought they were in Cayman? 22 A 23 98 Q 24 A 25 Mr. Traynor put them somewhere and you That is right. I am asking you about the Channel Islands? They then provided a company. I asked Mr. Traynor and he arranged for a company to be provided. 26 99 Q 27 A What year are we talking about? About 1988. 28 Are you telling me that before that, you had never 29 heard of College Trustees? 1 A. 2 3 I don't recall the name but I think I met a guy from over...(INTERJECTION). 101 Q. Let us continue this rather lengthy dialogue by 4 asking you some more detailed questions. 5 never heard of College Trustees. 6 Guinness & Mahon were associated with in the 7 Channel Islands -- when did you first know that? 8 A. 9 Had you Companies that Probably at the same time I would have heard about the Cayman, I don't know. 10 102 Q. 11 A. 12 103 Q. 13 A. 14 104 Q. In the early 1970's? Middle to late 1970's maybe. Middle to late 1970's? I went out on my own just after...(INTERJECTION). Answer my question. This is the middle to late 15 1970's that you first realised or understood that 16 Guinness & Mahon had association companies in the 17 Channel Islands? 18 A. I cannot be as specific as that. I understand that 19 I am under oath here and I cannot be as specific as 20 that. 21 not wanting to be unhelpful, 22 105 Q. 23 A. 24 106 Q. I am not sure when I learned that. I am just not sure. You want to be helpful? I do, absolutely. Tell me what you understood these companies that 25 Guinness & Mahon were associated with in the 26 Channel Islands. 27 A. 28 29 What were they? Evidently one was College Trustees. I don't know how long that is in existence. 107 Q. That is That was one company. Any other companies? 1 I think from your documentation there is a 2 Guinness & Mahon something or other, maybe Guinness 3 & Mahon Channel Islands. 4 years ago. 5 there was a Guinness & Mahon Channel Islands, it 6 probably dealt in banking situations and maybe 7 College Trustees acted in secretarial situations. 8 I am not positive about either of those things. 9 There was a Sovereign something or other. I may have heard of that But I don't recall. And I presume if 10 think the managing director of that at a 11 Guinness & Mahon golf outing. 12 they did. 13 work. 14 108 Q 15 I met I I don't know what They may have done trusts, secretarial I don't know what they might have done. Did Mr. Traynor never talk to you about these companies ? 16 A 17 109 Q 18 A No. Never? No, the only time he talked to me in detail was one 19 time he came around talking at a time when he had 20 acquired or had a small percentage of a company in 21 Cayman. 22 the Cayman. 23 110 Q 24 A 25 26 He talked about disengaging himself from I am talking about the Channel Island companies? I have no recollection of him talking to me about the Channel Islands. 111 Q 27 Did he explain to you why they had to be established? 28 A 29 112 Q No. Did you know why? 1 2 113 Q 3 Did you know that there were exchange control difficulties ? 4 A 5 114 Q 6 A 7 115 Q No. Did you ever hear that? That he had exchange ...(INTERJECTION). No, that there were exchange control difficulties 8 which meant that Guinness & Mahon decided to 9 establish subsidiaries in the Channel Islands? 10 A 11 116 Q 12 A 13 117 Q 14 15 I wouldn't know that. I am wondering did he ever tell you that? No, never. Did you ever ask him why they had established companies in the Channel Islands? A No, I don't know that he established companies in 16 the Channel Islands. 17 long before Des Traynor and maybe they had them. 18 118 Q Alright, Guinness & Mahon was there I withdraw that. I apologise to you for 19 confusing you. 20 Mr. Traynor explain to you why Guinness & Mahon 21 Ireland established subsidiaries or companies in the 22 Channel Islands? 23 A 24 119 Q 25 A 26 120 Q Try now and get it clear. Did No. He didn't? No. Apart from Mr. Traynor, who was a friend of yours, 27 with whom did you have dealings when you went to 28 Guinness & Mahon on behalf of clients? 29 A Probably Maurice O'Kelly but that would have been 1 sometime later when he joined Guinness & Mahon. 2 Definitely Pat O'Dwyer who was a banking manager. 3 Probably Martin Keane. 4 John Guinness at one stage. 5 William Forwood at a later stage but it hadn't 6 anything to do with his role in Guinness & Mahon. 7 In fact he might have even left Guinness & Mahon at 8 the time. 9 121 Q 10 A 11 122 Q Michael Pender. I had dealings with I cannot remember any other names. You cannot remember any other names. If they were put to me I might. Try. I will put a name to you in a minute. But we 12 Will see if you can remember it without me putting 13 it to you? 14 A There was John Guinness; he was Chairman. 15 There was Des Traynor himself certainly. 16 Maurice O'Kelly. 17 Maurice O'Kelly; that would have been much later. 18 William Forwood was in Guinness & Mahon but while he 19 was there I don't think I had any dealings with him. 20 But I had dealings with him subsequently. 21 Martin Keane. 22 123 Q 23 A 24 124 Q 25 A There was But not much dealing with Padraig Collery. Padraig Collery, you had dealings with him? Yes, I did. Tell us about that. Do you know what his role was? My view of it was that he was a kind of an assistant to Des Traynor. 26 27 125 Q 28 A 29 126 Q How often would you have met him then? Several times over the years. Surely more than that, Mr. Stakelum, surely more 25 1 than several times over the years? 2 A 3 127 Q 4 5 A lot of times. Over a year how often would you have met him? A 6 7 I thought several was a lot. That would depend upon what client was doing what and where and when. 128 Q Taking an average, how often would you go into 8 Guinness & Mahon and see some of these people. 9 Once a week? 10 A There could be times there when you could be in 11 three times a week and then you might not be in for 12 three months. 13 Mahon I would have had little, if anything, to do 14 with Padraig Collery because I would have been 15 dealing mostly with Guinness & Mahon. 16 129 Q 17 A 18 130 Q When Des Traynor was in Guinness & With Des Traynor? With Des Traynor, yes. When you would go in three times a week for 19 particular clients, that would be Des Traynor you 20 would be seeing? 21 A Mostly my dealings would be where Mr. Traynor would 22 be the Principal. 23 financial arrangements or something, you could be 24 dealing with Martin Keane and going back for further 25 information. 26 131 Q 27 28 29 But if you were ironing out When Mr. Traynor left the bank you were then dealing with Mr. Collery, is that it? A Yes. I can think of a couple of specific situations with Mr. Collery thereafter. 1 In relation to your association then with 2 Guinness & Mahon, you have described your general 3 consultancy work. 4 with Guinness & Mahon, that you went to Guinness & 5 Mahon to organise financial assistance, loans of one 6 sort or another for clients? 7 A 8 133 Q 9 Is that the relationship you had That's right. This would have been a situation where sometimes you would be in regularly three times a week and 10 sometimes a gap of months would elapse, is that the 11 position? 12 A 13 134 Q Absolutely. Was this an important connection from your point of 14 view, your connection with Guinness & Mahon and the 15 fact that you were able to get loans for clients on 16 behalf of clients from Guinness & Mahon. 17 an important aspect? 18 A It would be very important. Was this When you are 19 endeavouring to get loans the personal connection is 20 of the utmost importance, yes. 21 135 Q 22 A 23 136 Q I would have thought so. It is most important. Would I be correct in saying that in most cases you 24 would have first gone to Guinness & Mahon to see if 25 you could get loans for your clients rather than to 26 some other financial institutions? 27 No, I don't think that would be correct necessarily. 28 The clients would probably of their own volition 29 have their own bank. You would deal with their own 1 2 bankers. 137 Q. You wouldn't switch bankers lightly. If the client needed funds and wasn't able to get 3 it, you would advise them and you would advise to 4 try Guinness & Mahon, would you? 5 A. I might. You would generally try at the bank where 6 they were doing business. 7 awkward financing, with the good connection in 8 Guinness & Mahon, certainly in the earlier days I 9 would have used Guinness & Mahon a fair bit for If there was more 10 clients because I had this entree to Des Traynor and 11 you could talk to the managing director. 12 138 Q. That is what I would have thought. In relation to 13 them requiring security for loans did you come 14 across any suggestions made in relation to security 15 for the use of Ansbacher deposits or deposits by 16 Guinness & Mahon in Guinness Mahon Cayman Trust in 17 the bank or otherwise? 18 A. In dealing with the bank, I would want to emphasise 19 that you wouldn't get anything out of Des Traynor 20 that wasn't proper banking approval. 21 knew him there weren't any concessions that would be 22 made to me. 23 proposition that wasn't bankable more quickly than 24 he might a stranger. 25 139 Q. 26 A. Because I He would tell me where to go with a I am asking you about security? I am leading into that, Mr. Costello. On the 27 question of security, I think what you are referring 28 to is a question of back-to-backs. 29 I certainly would have had deposits of clients 1 there. 2 accounts -- although I am well aware of them -­ 3 except for one in connection with Mr. Keane that I 4 referred to. 5 sure that is the sole back-to-back one because 6 certain things have been suggested at stages along 7 the way. 8 a back-to-back situation. 9 140 Q 10 A I don't have recollections of back-to-back I have to say, I cannot be absolutely I was personally opposed to ever utilising Why was that? Because I had to deal with the client, some on a 11 day-to-day basis. 12 if anyone operated a back-to-back situation the 13 client believed that there was no money due. 14 had £100,000 and he borrowed £100,000 up front, the 15 danger was that he gets into thinking that the 16 £100,000 doesn't have to be paid back because it is 17 backed. 18 141 Q There was a great tendency that If he That is a disastrous financial situation. I think you understand from our letter and probably 19 from elsewhere that I am not just concerned about 20 ordinary back-to-back situations, I am concerned 21 about Ansbacher deposits being used as security for 22 loans given to your clients? 23 A 24 That is what I refer to as back-to-back, that is the security on the backing to the front loan. 25 142 Q 26 A 27 143 Q But the security was an Ansbacher deposit? That's right, yes. When you are talking about back-to-back loans, we 28 are being specific, we are talking about clients who 29 would have had a security for loans which Guinness & 1 Mahon had given; a deposit which was in the name of 2 Ansbacher in its former name, perhaps as Guinness 3 Mahon Cayman Trust and later Ansbacher? 4 From my point of view it would only be let us say 5 the funds that I would have had placed with 6 Mr. Traynor. 7 Ansbacher or College Trustees or Jersey or what. 8 144 Q 9 A 10 145 Q I wouldn't know whether they were But they were outside the jurisdiction? That's right. What we are then talking about is funds which you 11 had deposited on behalf of clients with Mr. Traynor 12 which were out of the jurisdiction and which were 13 being used as security for loans to your clients? 14 A 15 16 I am only aware of it in one situation. There may have been others but I certainly don't recall. 146 Q What we are discussing now are loans which were 17 secured in the way we have been discussing. 18 does appear from what you have been telling me that 19 part of the service that you gave to your clients 20 was arranging the transfer of funds to Mr. Traynor 21 who deposited them offshore, is that correct? 22 A 23 147 Q 24 A That's correct. When did that start? I am inclined to believe 197 6 but it might have been 25 1977. 26 I only had one month of operations in 1975. 27 148 Q But it I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service 1 If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 9 149 Q Could you not be a little bit more specific because 10 you know these terms, I don't know. 11 explaining them to us? 12 A Would you mind If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 Q 16 A 17 151 Q 18 A 19 152 Q 21 A 22 153 Q 23 Why would they want to place their funds with you? They might be unhappy about monitoring the funds in But you were not a bank? No. They were asking your advice as to where to put the funds ? A 25 26 Yes . the sense of what interest rate...(INTERJECTION). 20 24 This is client's of yours? They were asking me whether I could monitor those funds on their behalf. 154 Q Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A They would say 'We have funds offshore' wherever 31 1 they might have been 'Can you look after these funds 2 for m e .' 3 155 Q 4 5 What did that mean? A 6 7 "Can you look after these funds." Would you endeavour to get the best interest rate. Would you monitor the funds. 156 Q Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial 10 11 institution? A I don't think they would come in and say 'We have 12 funds. 13 financial institution.' 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 Q 18 A Will you change them for some other I think a discussion would What does that mean? It means that they might not want to correspond 19 directly with whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 158 Q 27 A And that What did you do then? I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 Q 2 A 3 160 Q 4 5 You then contacted Guinness & Mahon? Yes . You used the word "facility." What does that mean in this connection? A It means I would probably have contacted 6 Des Traynor. 7 -- for the most part he wouldn't know who my clients 8 were -- that wishes to have funds monitored abroad 9 by m e .' 10 161 Q I would have said 'I have a client Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A You have a client. Des Traynor is to give me an account number, a 14 reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either -- might be 18 moved to a receiving bank. 19 162 Q This is very important. Those funds -­ If you don't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 163 Q 28 A 29 What was the bank? Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 1 What was the account, in whose name was the account 2 to be placed? 3 A I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q 8 9 All I am saying is You must have known the financial institution in which your clients's funds were going to be placed? A The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 16 6 Q Tell me some of them that were used that 13 Mr. Traynor would have told you about. 14 names of some of those, Mr. Stakelum? 15 A Give me the It is very difficult under oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 so etc. etc.. 20 that. 21 If it was dollars it might be something else. 22 167 Q 23 24 I don't know. But I am not absolutely positive of It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? A I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 Do your best. I am sure you are under strain, 29 Mr. Stakelum. Tell me the numbers of other I don't know. It probably 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A 5 be uncooperative, 6 169 Q 7 A 8 170 Q 9 That is not wanting to I just cannot remember. Why can't you remember? How do I answer a question of why I cannot remember? For example, were any of the funds lodged in any of the Guinness & Mahon subsidiaries in Cayman or in 10 11 I just cannot answer that. the Channel Islands? A I don't think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q I am not too sure. It may have been the account of Guinness & Mahon in 18 Dublin or Guinness & Mahon in London. 19 offshore bank we are talking about, Guinness & Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 A 24 172 Q 25 A 26 173 Q Was this the They would have It may well have been, I don't remember. But you are under oath now? That's right. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? 1 I cannot remember. 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 what their internal ...(INTERJECTION). 5 A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A 11 I suspect that some of the Didn't you say that to me a few They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 12 175 Q 13 A 14 176 Q They were offshore already you think? Yes, most of the funds were offshore already. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 A 18 177 Q 19 A Did you ever have clients coming in Yes . What would happen then? At different stages, in the early stages I think 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 Q 24 A 25 179 Q 26 A It is one and the same in the Then they could be moved from Sterling. Were they put offshore, the funds? Yes . Where ? All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey. But it could well have been 1 180 Q 2 A 3 181 Q Yes, I assume one or the other. Did any of your clients to your knowledge establish 4 trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in the Cayman Islands or in the 6 Channel Islands? 7 A 8 182 Q 9 A 10 183 Q 11 None of them told you that they had done this? No. Mr. Traynor didn't tell you that he was going to suggest this to them? 12 A 13 184 Q 14 15 Not to my knowledge. No. You are pretty certain on that or are you doubtful about it? A I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q 19 If they didn't establish trusts, you are aware of clients who transferred funds offshore? 20 A 21 186 Q 22 Yes, that's right. We will break now for a cup of coffee, Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 I am not aware of any SHORT ADJOURNMENT 1 2 3 I want to clarify something Mr. Hayes has brought to 4 my mind. 5 made it clear that when I was talking about the 6 transfer of funds to a bank, I was really talking 7 about a receiving bank where they have what they 8 call a "routing." 9 from A to B there is often an intermediary bank that In the last bit of evidence I may not have If you are transferring funds 10 takes the routing of the funds. 11 referring to that I didn't know. 12 could vary each time on that. 13 what the specific instructions were any day. 14 would be transferred from wherever the client had 15 the funds on his instructions to a bank routing. 16 Then they would come under the control of 17 Des Traynor and they would transfer them on further. 18 That is the norm. 19 187 Q 21 like to ask you some questions. MS. MACKEY: 23 Ms. Mackey now would Mr. Stakelum, I would like to ask you some 24 questions about Ms. Banotti. 25 your response to our letter? 26 They I have no further questions to ask you, Mr. Stakelum at the moment. 188 Q The instructions I wouldn't have known 20 22 That is what I was A Do you have a copy of I do. 27 If I could refer you to that. 28 of 11th October (EXHIBIT 1)? 29 That's right. That is your letter 1 190 Q. You say under the heading 2 "Part One: 3 Having read Ms. Banotti's evidence to you..." 4 5 I will just recall to your mind that the evidence 6 related to three cheques from the European 7 Parliament made payable to Ms. Bannotti which 8 somehow or other ended up in the account of 9 Guinness Mahon Cayman Trust re College Trustees in 10 Guinness & Mahon. 11 asked her about them that in fact she had no 12 Ansbacher account but that your firm, BEL, looked 13 after her office and administration here in Dublin 14 after her election to the European Parliament and 15 that in the course of that she must have passed to 16 you these European Parliament cheques, which were 17 cheques for expense incurred by her, in order to 18 reimburse you for services you carried out for her. Ms. Bannotti told us when we 19 20 You say: 21 "Having read Ms. Banotti's evidence to you I can confirm that her evidence in relation to her contractual relationship with my company is correct." 22 23 24 First of all I would like to ask you a bit about 25 that contractual relationship. 26 of all. 27 the European Parliament? 28 29 A. No. When it began first Did it begin before she became a member of I am not sure on dates but I guess she might have become a member in 1984? 1 191 Q 2 A It was, yes? It would have been immediately at that time. 3 Evidently in the European structure it was and still 4 is necessary for the Members of the European 5 Parliament to have a secretarial company, which is 6 the company to which expenses are paid by the 7 European Parliament. 8 expenses to the individuals that would be aides to . 9 Ms. Banotti. They discharge the particular There was actually a signed contract 10 I know in existence at the time. 11 repeated each session or not, I am not sure. 12 192 Q 13 A 14 193 Q A signed contract between? Between Business Enterprises Ltd and Mary Banotti. Can I ask you how she first came in contact with you or how you met her? 15 16 Whether that was A Yes. It was through a place called the 17 Rutland Centre which is an alcohol treatment centre. 18 Fr. Short was the founder of that organisation. 19 He is dead since. 20 Kennedy Crowley & Co. 21 Fr. Short needed somebody, he was getting involved 22 in some subject with the brothers in Donegal. 23 Fr. Short rang me. 24 explain his concept of a treatment centre. 25 different modality of treatment. 26 having a meeting in Ms. Banotti's house. 27 I didn't know Mrs. Banotti at the time. 28 of us met in her house. 29 194 Q I worked with his brother in The brother rang me and said He came up to the house to It was a He said we are Five or six She had a small house. Not to cut you short, Mr. Stakelum, but perhaps we 1 can short circuit this a little bit. 2 through something that had no connection with the 3 business at all in the beginning? 4 A 5 195 Q 6 A 7 None whatsoever. Was this some long time before her election? Yes. The reason I would know that is because I think we started the Rutland Centre in 1978. 8 196 Q 9 A 10 11 You met her You had known her for some long time prior to this? I had known her for five or six years prior to before she became...(INTERJECTION). 197 Q 12 Did she then upon her election ask you to look after her office administration? 13 A 14 198 Q 15 A That's right. That is how that began? Yes. There would have been a reason in the sense 16 that it lead a little into her personal finances in 17 the sense that one night after a meeting she rang 18 me. 19 her house. 20 I would have helped her organise a home loan in AIB 21 in Sandymount. 22 199 Q She was very distraught; she had a break-in in I said 'You have to leave the area.' You were dealing with her personally. She was one 23 of your clients in your capacity as a financial 24 adviser? 25 A I don't know that she would go down as a client, she 26 would go down as a friend. 27 for her at that stage, but it was kind of natural 28 that when she went into the Parliament and when she 29 was looking for somebody she came to u s . I just arranged a loan 1 200 Q 2 Was that the only financial advice you gave her prior to taking on this business? 3 A 4 201 Q Absolutely. This arrangement that you had for looking after her 5 office and administration costs, did you pay the 6 members of staff who were on her payroll on her 7 behalf. 8 A 9 202 Q Was that how it was done? Yes, that's right. Did you then send her an invoice setting out 10 whatever your expenses and costs had been and your 11 own fees? 12 A 13 203 Q 14 A No. What was the arrangement? In the beginning there was quite a lot of work. 15 were writing up her cheque books and things like 16 that. 17 204 Q 18 19 All I am asking you now is, how did you get reimbursed. A We What did you do. She used the word "reimbursed." Did you invoice her? I would have felt 20 that she would have paid us in advance mostly. 21 Certainly that would have been the case for the last 22 number of years. 23 have been paid? 24 money on behalf of clients and recoup it later. 25 would recoup the money and pay. 26 205 Q incurred. 28 doing this? A We wouldn't generally pay out We I can understand that, they were the expenses you 27 29 Whether in the beginning I would But did you not charge her a fee for I did not charge her a fee; she was a close personal 42 1 friend. 2 colleague who took it over, I think she paid him 3 something. 4 such. 5 206 Q After a while, some years later my I don't think I ever charged a fee as You didn't invoice her. Your memory is that she 6 paid you in advance. 7 What was the arrangement. 8 A 9 How did she normally pay you. Was it by cheque? I brought some stuff from Business Enterprises Ltd. I have a copy of her account. I only have this 10 from about 1991 but it does show the kind of 11 transactions for the last eight or nine years. 12 207 Q 13 A 14 208 Q A 17 18 It is the only copy I have. We can make a copy of it now and give it back to you. 15 16 That would be useful. (EXHIBIT 4) SAME HANDED Obviously looking at that, we did pay sometimes in advance. 209 Q There are some red figures there. We understand from Ms. Banotti that for the purposes 19 of office expenses and administration costs of 20 MEP's, the European Parliament would transfer money 21 directly into a bank account in the country of that 22 particular MEP and that she had such a bank account 23 here in Ireland. 24 have been paid from that bank account. 25 be the case? 26 A I am guessing so. Presumably, normally you would Would that I wouldn't be close to it. 27 I presume so and this may show that. 28 On this particular occasion Ms. Banotti can only 29 explain the appearance of these three cheques in the 1 GMCT account by saying that she must have passed 2 these to you in the course of paying you or 3 reimbursing you for your services or for your 4 expenses incurred on her behalf. 5 that happening? 6 No. 7 those cheques. 8 But I would have to say that the probability is that 9 she was correct. Can you recollect I think I said that I don't know how I got But I cannot at all recollect it. What I believe may have happened 10 is that it wasn't paying any of her expenses but she 11 could have been in my office and saying 'I am short 12 of money. 13 given her cash for them and then lodged them because 14 they were a foreign...(INTERJECTION). 15 211 Q 16 A 17 18 I could have She may essentially have exchanged them? For cash, yes. I don't know that but I suspect that is the most likely answer. 212 Q 19 20 I don't have any money.' You say that in such case you must have lodged them. Lodged them where? A What I am saying is that I haven't any recollection 21 or knowledge of that but I am told that they were 22 lodged on the assumption that she gave them to me. 23 213 Q I understand what you are saying, Mr. Stakelum. 24 What I am trying to get at is where would you in 25 such a situation, if it arose hypothetically, lodge 26 them? 27 A 28 214 Q 29 A I would have sent them down to Guinness & Mahon. To Mr. Traynor? 1 215 Q 2 A Because they were foreign currency. That was 3 foreign currency that you might treasure as opposed 4 to Irish pounds. 5 216 Q 6 way to Mr. Traynor to exchange for you? 7 A 8 217 Q 9 10 You would give any foreign currency that came your Yes. It would be rare. But why would you do that rather than exchange it in the ordinary way. A Why give it to Mr. Traynor? Because I would have clients that might be giving me 11 Irish pounds that would want the foreign currency. 12 I could exchange that with them. 13 218 Q You could exchange it with the client? 14 A If I had the foreign currency I could. 15 219 Q 16 A 17 220 Q 19 A 20 That kept it For you? To exchange for a client who would want to change money. 221 Q 22 23 But that kept it in foreign currency. available. 18 21 But in this case you gave it to Mr. Traynor? By giving it to Mr. Traynor it kept it available for you? A Yes. If I lodged it into a local bank it would have 24 been converted back into Irish pounds. 25 giving it to Mr. Traynor you kept it in a foreign 26 currency. 27 222 Q 28 29 But by In other words, you were giving it to Mr. Traynor to keep for you essentially, is that it? A Yes, it would be general to keep it for clients that 1 2 223 Q 3 A 4 5 But in your name? He never kept an account in my name. I don't know that he kept the account. 224 Q What I am trying to get at is, was this money that 6 you felt you could again access if you wished in 7 foreign currency? 8 A 9 225 Q Yes . Therefore, it was going to be kept in your name or 10 on your behalf; it was your money, is that it. 11 If you had exchanged your Irish money for 12 Ms. Banotti's Belgian Francs they were now your 13 Belgian Francs? 14 A 15 226 Q 16 17 Right. Can you explain how they ended up in a GMCT account? A That would be their thing. I don't know where they 18 would use it. 19 Cayman Trust or whatever place they kept the foreign 20 funds. 21 assumed incidentally that it was Cayman Trust. 22 227 Q That could be College Trustees or I wouldn't necessarily know. I would have You would have assumed that money you gave to 23 Mr. Traynor for you would go into Guinness Mahon 24 Cayman Trust? 25 A 26 228 Q 27 A 28 29 Foreign currency, yes. Why would you assume that? Because I assumed that is where he kept all the foreign currency. 229 Q To understand what you are saying, you would assume 46 1 that if you gave foreign currency to Mr. Traynor to 2 look after for you, he would put it into Cayman. 3 Is that what you are saying? 4 A 5 230 Q 6 A 8 231 Q 9 Yes, I am using "for me" in the loosest sense. How can you use the phrase "for you" in a loose sense? A 11 Because I would have clients anxious to get foreign currency. 12 232 Q 13 A 14 15 In other words, Mr. Traynor would keep for you money in Cayman? 7 10 That is what I am saying, yes. I understand that. If he had money in foreign currency available, then they could access that by giving me Irish pounds. 233 Q 16 I understand that. But the point is, this is your money that we are talking about now? 17 A 18 234 Q Okay. What you would expect if you gave your money which 19 happened to be in foreign currency to Mr. Traynor, 20 he would put it into a Cayman account? 21 A 22 23 Yes. Into a foreign currency deposit account, probably Cayman. 235 Q I don't have any further questions, Mr. Stakelum. 24 Thank you. 25 MR. JUSTICE COSTELLO 26 ask you some questions now 27 about Mr. Keane. 28 MR. ROWAN: 29 Mr. Rowan would like to Mr. Stakelum, can I take you back to the statement 1 that you sent us please, the one of 22nd September 2 (EXHIBIT 2). 3 in two places at paragraph 4 and paragraph 7. 4 Perhaps to start, can you tell us when Mr. Keane 5 became a client first? 6 A 7 237 Q 8 A 9 That deals with Mr. Keane's affairs I suspect in the early 1980's. Why did he become a client of yours? He was introduced to me through another client, as I recall on a golf course. I don't recall whether he 10 rang me or said to me at the time at the golf 'I 11 would like to come and talk to you' but he obviously 12 did come and talk to me. 13 238 Q 14 A What services did he explain he needed from you? His initial services were loans that he required in 15 connection with ... He bought out a partner that he 16 had. 17 the company. 18 was an employee he had who had 10%. 19 buy out the partner. 20 the first transaction with Mr. Keane. 21 239 Q 22 A 23 240 Q 24 A As I recall in his company here he had 45% of A non-active partner had 45%. So he came to you and said can you arrange a loan? That's right. How did you approach dealing with that request? I know that I would have raised a loan through Guinness & Mahon with him. 26 in the order of £40,000. 241 Q He wished to That was my recollection of 25 27 There I have a feeling it was When you were looking at the client's needs, 28 presumably you could have raised a loan of that sort 29 through any number of banks. Why did you select 1 Guinness & Mahon? 2 Obviously I cannot remember exactly but his company, 3 Gerry Keane Ltd, would have been dealing with and 4 still deals with AIB Ltd. 5 been supplying the needs for the company, the 6 trading facilities overdraft. 7 company item, it would have been a personal item to 8 buy shares in the company. 9 that I can think of for using Guinness & Mahon at 10 But AIB Ltd would have This would be not a That is the only reason that time. 11 242 Q 12 A But you could perhaps have used Bank of Ireland? Yes, I could but I have very ready access to the top 13 echelon in Guinness & Mahon where it was easy to 14 discuss unusual items of financing if you like. 15 It was a bit unusual in the terms of the banking 16 sector to be going from AIB to Bank of Ireland in 17 connection with the shares of the company. 18 bit unusual. 19 investment orientated bank. 20 243 Q It is a Guinness & Mahon were a more When you went to Guinness & Mahon and they agreed to 21 advance this loan to Mr. Keane, did they require 22 terms, securities, that sort of thing. 23 remember broadly? 24 A 25 244 Q 26 A Can you I don't remember. Was it an unsecured loan? I don't remember that. But see if this would be 27 helpful: 28 after that, he required another loan. 29 separating from his wife. Sometime after that, I don't know how long He was My knowledge or my 1 memory was that he had to borrow about another 2 £40,000. 3 secured or not but Mr. Keane had become a depositor 4 with me at some stage and had offshore funds. 5 So the extreme likelihood is that whether at the 6 outset of the first loan or at the outset of the 7 second loan or somewhere in between, he would have 8 acquired some offshore deposits with Des Traynor 9 through me. 10 245 Q I don't know whether the first one was May I just stop you there. How soon after you 11 became an adviser to Mr. Keane would he have started 12 to have offshore deposits? 13 A 14 246 Q 15 A 16 17 I just wouldn't remember that. Was it soon or was it some years? I suspect it would have been relatively soon afterwards. 247 Q On the one hand Mr. Keane was borrowing money to buy 18 a partner in his company out and on the other hand 19 he was putting money offshore on deposit? 20 A 21 248 Q 22 A 23 249 Q 24 A Right. Is there a contradiction there? No. Can you elucidate on that? Because he would have wanted to maintain 25 confidentiality about funds offshore and he couldn't 26 do that using those funds that would be offshore to 27 make the payments that he wanted to up front. 28 Mr. Keane had some money on deposit offshore. 29 How did that topic come up with Mr. Keane as far as 1 2 A. I am not sure. I am sure he would have introduced 3 the topic at some stage and asked me could 4 I ...(INTERJECTION). 5 251 Q. He had some funds and he would have said to you at 6 one of your meetings 'I have these funds, 7 Mr. Stakelum, can you advise me how to look after 8 them well from an investment point of view.' 9 Is that what he would have said? 10 A. Investment is too fancy a word. I didn't invest 11 money on behalf of clients, only with their specific 12 instructions. 13 some cases at some stages clients asked me 14 specifically to arrange the purchase of shares. 15 But that would be totally at their discretion. 16 252 Q. Monies were on deposit purely or in Let us concentrate specifically on Mr. Keane, which 17 is what I want to do: 18 funds on deposit somewhere else before he raised the 19 issue with you? 20 A. 21 253 Q. 22 Did Mr. Keane have these I don't think so. This was an arrangement where he proposed to put money on deposit? 23 A. 24 254 Q. 25 A. 26 255 Q. That's right. He asked for your advice? He must have. Would he have been aware of the sorts of offshore 27 arrangements that there might have been or is this 28 information that would have been new to him? 29 A. I really don't know whether he would have funds 1 offshore. 2 arisen. 3 could well have arisen in a discussion whereby he 4 was saying that he needed funds. 5 to purchase the partner. 6 separation with his wife. 7 have advised me that he had funds or funds available 8 to him or whatever. 9 256 Q 10 A 11 257 Q 12 13 I don't know how the subject would have I am not saying this is how it did, but it The first one was Subsequently the And he probably would And asked for advice as to how to deal with them? Yes, presumably. You would have given him advice. What would that advice have been? A I don't know what arrangements he might have had or 14 might not have had. 15 that if he wished, the funds could be placed through 16 Guinness & Mahon and I would look after the funds on 17 his behalf. 18 258 Q 19 I would have told him I presume Would you have indicated to him that the funds would have gone offshore? 20 A 21 259 Q Presumably but I think he would have known that. Would he have asked you where offshore they would 22 have gone when you placed them with Guinness & Mahon 23 on his behalf? 24 A No, I don't think any of my clients ever asked that. 25 But I think that they would have been well aware 26 that it was going through Guinness & Mahon. 27 260 Q 28 A 29 Does that imply that would have given them comfort? No, I think it implies that they were aware that I had close connections with Guinness & Mahon. They 1 were probably aware of Guinness Mahon Cayman Trust 2 or Guinness & Mahon. 3 We are talking about Mr. Keane specifically. 4 do you say that you believe that clients, and if I 5 can infer Mr. Keane in that, would have necessarily 6 known about Guinness Mahon Cayman Trust and things 7 like that. 8 now? 9 A Why We are talking about the early 1980's I would suspect through me that if he asked could 10 these funds be handled, 11 handled through Guinness & Mahon. 12 would have assumed that they were handled through 13 Cayman. 14 262 Q 15 A 16 263 Q 17 18 As I said, I You would have provided them with the information? Presumably. Which of course was information you in turn would have obtained from Guinness & Mahon? A 19 Yes. When you say "obtained" it was just knowledge. 20 264 Q 21 A 22 23 I would say they could be But you gain knowledge from some source? Yes, I was aware of Mr. Traynor's involvement with Cayman. 265 Q He was travelling frequently to Cayman. When it was established that it was suitable for 24 Mr. Keane's money to be placed offshore through 25 Mr. Traynor, did you advise Mr. Traynor of 26 Mr. Keane's name? 27 A 28 2 66 Q 29 A I don't remember that. But with your best estimate? At some stage. It may have been the second loan 53 1 that he needed it for. 2 wouldn't have established that. 3 advised Mr. Traynor that there were funds. 4 know whether that was for the first or the second or 5 subsequent loans. 6 We are going on a little faster than I want. 7 The situation is that you would have got a 8 negotiable instrument or cheque, presumably from Mr. 9 Keane and would you have passed that over to His credit worthiness We may then have I don't 10 Mr. Traynor. 11 cheque or draft or whatever it was, was on behalf of 12 Mr. Keane? 13 A 14 268 Q 15 Would Mr. Traynor have known that Probably not. Mr. Traynor would have indicated to you where he was going to put it on deposit? 16 A 17 269 Q No, not at that point. Would you have been aware from Mr. Traynor as to 18 where he was then going to deposit this money within 19 the Guinness & Mahon organisation? 20 A If I was asked that question a year ago, I would 21 have said yes, I would presume it was Guinness 22 Mahon Cayman Trust. 23 arisen that leads me to question where it might have 24 been. It was offshore but whether it was Guinness 25 Mahon Cayman Trust, whether it was in Jersey, 26 whether it was in Dublin in the account of 27 Guinness Mahon Cayman Trust, I don't know any of 28 those factors. 29 At this point Mr. Traynor may not have known 54 But subsequent matters have 1 Mr. Keane's name and Mr. Keane would not have known 2 because you didn't know where his money was being 3 deposited? 4 A. That is if the sequence of events is as I say. 5 Mr. Traynor would have known Mr. Keane's name if 6 loan had already been raised because there would 7 have been a front up loan. 8 whether he had 9 was raised with him or not. But I don't know funds offshore before the first loan Mr. Traynor generally 10 wasn't aware of my clients names because it was a 11 hotchpotch account with him. 12 But where there was a situation where they had to 13 back-to-back funds on a security, they would 14 presumably do some adjustment on their accounts to 15 do that and they would have to be aware. 16 271 Q. It generally wasn't. So that you don't know whether in fact Mr. Keane's 17 money went into the hotchpotch account, which is 18 your description of it? 19 A. I suspect it did. But then to the extent that 20 borrowings were needed to be secured by that, 21 presumably the bank may have moved it. 22 272 Q. 23 The hotchpotch account would have been identified as being an account of yours? 24 A. 25 273 Q. That's right. So that Mr. Keane would have deposited money with 26 you to be put offshore from time to time, is that 27 correct? 28 A. 29 274 Q. a Right. How often might he have had money to deposit, can 1 2 A 3 275 Q 4 A No. Annually? I would suspect in the early days maybe more than 5 annually. 6 from wherever he got it. 7 all. 8 276 Q It might be whenever he got the money But in later years not at But in event he came back for a second loan. 9 You inferred it might have been something to do with 10 the difficulty with his wife or something like that? 11 A 12 277 Q 13 14 Yes . At that point what happened. Did Guinness & Mahon say 'We would like to change the arrangements.' A I don't know but that is certainly possible that 15 they might have said ...My recollection is that at 16 some stage he had two loans with Guinness & Mahon, 17 one of about £90,000 and another of about £90,000. 18 One being his personally and one being the 19 company's, Gerry Keane Ltd. 20 arising from two main transactions, firstly funds 21 borrowed to pay his partner. 22 borrowed to pay his wife as part of a settlement. 23 278 Q 24 A His personal loan Secondly, funds I understand that. The other one was a company trading loan that he 25 would have had with Guinness & Mahon. 26 along the way I suspect his offshore funds were used 27 as part security. 28 279 Q 29 A Somewhere How did that issue get raised? It may have been raised on the basis of the level of 56 1 borrowings that he was rising to. 2 know when his company would have borrowed the money. 3 It may have borrowed and increased along the way. 4 I don't know at what stage Guinness & Mahon might 5 have said that they needed some additional security. 6 I don't know. 7 may have been later on. 8 it was. 9 280 Q I don't exactly It may have been very early on or it I don't know at what stage It is the sort of thing that a bank would do 10 whenever borrowings were going up, they would look 11 for their cover? 12 A 13 281 Q Of course. Would that make it likely that Mr. Traynor raised 14 the issue with you when you met him on some occasion 15 or was it something which was prompted by the 16 request, the application for a second loan? 17 A I don't know. I suspect that the loans were 18 reviewed generally on an annual basis with the banks 19 and at some stage maybe in the review they would 20 write to Clyde Road because we would have arranged 21 it on behalf of him. 22 said that at review stage there are repayments 23 necessary or whatever. 24 discussion where they presumably sought and looked 25 for funds that were offshore to back the security. 26 282 Q 27 A 29 283 Q And there would have been a So the back-to-back arrangement was proposed by Mr. Traynor? 28 They may have written and Presumably. How was it effected? 1 I am not sure. 2 is to move such funds as were needed out of the 3 hotchpotch account. 4 would leave them there, but they might earmark them. 5 I don't know. 6 Would you have been advised of any movement of 7 monies out of the hotchpotch account? 8 A 9 10 I cannot remember that they Most definitely I would have to be advised. 285 Q 11 12 I would. But the simple way that you agreed Because it was an account in your or your company's name? A No, not my or my company's name. There was 13 probably a code name but I cannot remember code 14 names from those days. 15 Guinness & Mahon a long time and I don't remember 16 what the code names would have been. 17 286 Q 18 19 I am finished in Give me a flavour of the code. Was it a five-digit code or something more or something less? A No, it would be an initial and a number. I am 20 trying to recollect but I cannot really do it. 21 It could have been B7 or M10. 22 they would have used. 23 287 Q I don't know what Then there was the other side of course, which was 24 the arranging of the second loan. 25 involved Mr. Keane in some paperwork with Guinness & 26 Mahon. 27 Yes, there would be normal loan arrangements. 28 not sure but there were clients that I would have 29 certainly brought down to Guinness & Mahon. That would have Normal loan arrangements presumably? I am 1 Mr. Keane isn't big on paperwork. 2 he could have come to my office and completed 3 paperwork there. 4 you would have the usual thing: Memorandum and 5 Articles of Association and all that. 6 288 Q 7 A 8 289 Q 9 A 10 290 Q I have a feeling In connection with the company But would you have sorted all this stuff out? Yes, I would tend to do all that. And act as an intermediary with the bank? Yes . Going on to the second reference in your letter 11 (EXHIBIT 2) where you discuss at the top of page 4 12 of your letter Mr. Keane's desire to purchase a 13 residence in Ireland. 14 He had separated from his wife. 15 arrangement was that she was left in possession of 16 the family home. 17 years in apartments or rented accommodation. 18 he wished to purchase a residence off Waterloo Road. 19 I forget the name of it. 20 borrowing capacity here to borrow the funds that 21 would be a bankable proposition but he had offshore 22 funds. 23 for a couple of years. 24 anyway at some stage I took him out of Guinness & 25 Mahon as being too dear but he obviously wasn't 26 dealing with them at this stage. 27 his offshore funds. 28 confidentiality I advised against buying but he was 29 keen to do it. How did that issue arise? I think part of his I think he lived for a couple of Then He didn't have a I advised him against buying the property I am not sure on dates, He wanted to use In order to preserve his He would have to use an offshore 1 company. 2 him could he provide an offshore company. 3 this through Guernsey. 4 Properties. 5 bought this property and Mr. Keane went into a 6 rental arrangement with Beesley Properties and went 7 into occupation. 8 291 Q 9 10 Then I went to Mr. Traynor and I asked He did That was the Beesley It was arranged that Beesley Properties Mr. Traynor suggested Beesley Properties Incorporated? A He suggested that would be the method and presumably 11 that was the company. 12 shelf somewhere. 13 292 Q 14 A I presume it came off a That was the company registered in Guernsey? I don't know that but I think it would have been 15 provided by ... It may be College Trustees but 16 Guernsey. 17 They may have used a Guernsey company or 18 other...(INTERJECTION). 19 293 Q 20 21 It would have been provided by Guernsey. The point I was trying to get at was that it was a Channel Islands company? A Certainly provided by the Channel Islands. It might 22 have been some other jurisdiction company that was 23 appropriate but it would have been provided by the 24 Channel Islands. 25 Presumably recognising that, you recognise that 26 there was some sort of connection between a 27 Channel Islands company and where Mr. Keane's 28 deposits were? 29 No, that wouldn't strike me at all. 60 This was all 1 being handled by Mr. Traynor through Guinness & 2 Mahon, through their connections. 3 presumed that there was a deposit then with the 4 Channel Islands. 5 wouldn't follow. I wouldn't have There may have been but that 6 295 Q. 7 A. 8 296 Q. 9 A. No, using the actual funds. 10 297 Q. Using the funds on deposit? 11 A. 12 298 Q. 13 A. 14 299 Q. 15 A. Mr. Stakelum, Beesley acquired the property? Beesley acquired the property. Using as a back-to-back funds on deposit? Not back-to-back. He rented the house from Beesley? Yes. Sometime afterwards he decided to buy the house? Yes, about 18 months later I think. The reason he 16 would have decided that later is because a situation 17 developed where he would have the funds available to 18 do i t . 19 300 Q. 20 Approximately how much after Beesley acquired the property did Mr. Keane decide to buy it? 21 A. 22 301 Q. 23 A. I think it was about 18 months. How was that transaction arranged? I don't know. All I can tell you is that there 24 were transactions that did take place. 25 had a lot to do with it. 26 are concurrent with those things or not but they may 27 well have been. 28 29 302 Q. I would have I don't know whether they You said earlier that Mr. Keane when he was first thinking about buying a house, didn't have the 1 borrowing capacity. 2 A 3 303 Q 4 That was the term you used? That's right. A year and a half later he did have the borrowing capacity? 5 A 6 304 Q 7 A Yes . So he borrowed from someone to do that? I can explain why I think that happened. I am not 8 exactly sure of the dates. 9 stage he owed Guinness & Mahon about two by £90,000. I know that at one 10 was the company trading situation. 11 normally with AIB. 12 his shares. 13 out the other 10% shareholder somewhere along the 14 way. 15 share capital, in Gerry Keane Ltd to a company 16 called Gerry Keane Holdings Ltd for £180,000 which 17 was the value of the shares at that time but also 18 coincided with what the needs were. 19 Gerry Keane Holdings Ltd owed Gerry Keane £180,000 20 because he had sold his shares to this company. 21 owned the shares in Gerry Keane Holdings of course. 22 I got AIF to advance £90,000 to Gerry Keane Holdings 23 Ltd, which Gerry Keane Holdings Ltd paid to 24 Gerry Keane, who paid off his personal overdraft in 25 Guinness & Mahon. 26 off the company borrowings. 27 that particular thing, he then was repaying that 28 loan to AIF and 18 months later had sufficient of it 29 paid off for him to borrow another £90,000 by He was trading I arranged for Mr. Keane to sell He owned all the shares; he had bought To sell all his shares, which was 100% of the At this stage He I also got loans from AIF to pay But just to stay with One 1 Gerry Keane Holdings Ltd from AIF and have that 2 extra £90,000 paid to him which he used to buy the 3 house. 4 it operated well. 5 When Mr. Keane was buying the house from Beesley 6 Properties was there any issue about exchange 7 control? 8 A 9 No. Subject to the dates, that was the thing and I fail to see where it would arise there. he was buying was the property. All He was personally 10 buying it. 11 non-resident or a resident didn't matter. 12 think it ever mattered when he was buying it as a 13 resident here. 14 306 Q 15 16 Whether he was buying it from a Do I conclude from your answer that you did not give much thought to the issue of exchange control? A I wouldn't have given much thought to it; I wouldn't 17 have thought it would have arisen. 18 where it would have arisen there. 19 I don't 307 Q I don't see Can I show you a document which we have. You can 20 see that this is an exchange control application to 21 make a payment to a non-resident of the 22 State. (EXHIBIT 3) . 23 for £98,000 Sterling. 24 Properties of St. Peter Port, Guernsey. 25 is described here as the sale of 54, Heytesbury 26 Lane. 27 Central Bank for exchange control approval. 28 would have made that if you didn't? 29 I have no recollection of that. It is on behalf of Gerard Keane The payee is Beesley The purpose This is an application which was made to the Who I wouldn't know 1 anything about exchange control. 2 understand this. 3 application is made to "National Irish Bank, 4 O'Connell Street, Dublin 1." 5 308 Q 6 7 I don't even Name and address of which There seems to be some contradictions in this from your recollection of the situation? A I am not sure other than it appears to be an 8 application under exchange control Acts that I 9 certainly have no memory of. 10 309 Q 11 this application? 12 A 13 310 Q 14 15 The point about it is, you have no recollection of None whatsoever. What is the contradiction? I hadn't understood from you that National Irish Bank played a part in this? A I never heard of that. I don't even know where 16 they are on O'Connell Street. 17 AIB, O'Connell Street for donkey's years, probably 18 before I knew him. 19 O'Connell Street. 20 National Irish Bank. 21 to tell you the truth. 22 payee. 23 to do something? 24 311 Q He has dealt with We dealt with AIF and AIB, I never heard of a thing with I don't even know what this is The name and address of Is that an application by Beesley Properties I don't know. We will not speculate because time is 25 going on, Mr. Stakelum. 26 your clients might have availed of the withdrawal 27 service which Mr. Traynor operated? 28 A 29 312 Q From time to time some of Right. Do you know did Mr. Keane avail of that? 1 I would suspect not. 2 was the reverse. 3 offshore but then got borrowings probably up to the 4 extent of what he had offshore so he wouldn't have 5 been in a withdrawal situation until he came out of 6 it. I think Mr. Keane's position I think Mr. Keane had some funds I don't think so. 7 313 Q I don't have any further questions. 8 314 Q MR. JUSTICE COSTELLO Mr. Stakelum, there are 9 one or two matters I want 10 to clarify. 11 it is Mary Banotti 12 A 13 315 Q 14 These documents you have given us, (EXHIBIT 4)? Yes . It seems to be running from January 1991 down to 1998? 15 A 16 316 Q 17 A 18 That is only because those are the records I have. Where did you have that record? That was in Business Enterprises Ltd client's account. 19 317 Q 20 A 21 Where did you get it now to produce to us? I got it from Business Enterprises Ltd Client's Account Ledger. 22 318 Q 23 A 24 319 Q 25 A 26 Where is that ledger now? That is ledger is at my house. You have a ledger. What date does it run from? It seems that about 1991 is the first one there for Mary Banotti. 27 320 Q 28 A 29 Thank you. All your other clients would be in that, would they? No, not in the sense of talking about offshore clients. 1 321 Q. 2 A. 3 322 Q. 4 A. 5 Not offshore clients? No. Where are they? They would have been Irish funds held in banks...(INTERJECTION). 6 323 Q. 7 A. 8 324 Q. 9 A. 10 325 Q. 11 A. 12 326 Q. 13 A. 14 327 Q. 15 A. 16 328 Q. 17 A. 18 329 Q. 19 A. 20 330 Q. 21 A. What is the name of this ledger; what is it called? Business Enterprises Ltd Client's Ledger. That isn't clients who would have offshore funds? No. What ledger was that called? I didn't have a ledger. That is a technical term. You had a record? I had a month by month record, a schedule. You kept that, did you? Yes. Nobody else in your office kept it? No. Where are those records? They are all gone and destroyed. When did you do that, Mr. Stakelum? They tended to be destroyed as soon as they were no 22 longer needed. 23 if I got or gave them money, there was no receipt 24 exchanged either way. 25 clients used it in different ways -- to ring up at 26 any stage and find out what the balance on their 27 account was. 28 the records within some months each month. 29 331 Q. My arrangement with clients was that They were at liberty -- and But the tendency would be to destroy When was the last time you had any records of these 1 transactions ? 2 A 3 332 Q 4 A 5 333 Q Up to maybe 1998. It is all gone since 1998? All gone. Mr. Stakelum, as I told you we have to meet again 6 because we have to examine now the information that 7 you have given us. 8 but the week after. 9 possible to fix a date so that we can resume this 10 interview. 11 A 12 334 Q 13 I was suggesting not next week I was wondering if it was Would Wednesday, the 22nd suit you? That is great, yes. Very well then. fortnight. Say ten o'clock this day Thank you, Mr. Stakelum. 14 15 THE INTERVIEW WAS THEN ADJOURNED TO WEDNESDAY, 16 22ND NOVEMBER 2000 17 18 19 20 21 22 23 24 25 26 27 28 29 Ma; so? Gmwi \idkso mum? 00 Appendix - UNDER OATH ON WEDNESDAY, 6TH DECEMBER 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer PRESENT The Inspectors: MR. ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS 1 2 THE EXAMINATION CONTINUED, AS FOLLOWS, ON WEDNESDAY, 3 6th DECEMBER 2000. 4 5 6 MR. ROWAN: 7 Good morning Mr. Stakelum. The interview on Wednesday 8 the 8th of November was adjourned and this is a 9 continuation of that interview. You were on oath on 10 that interview and you continue to be on oath. 11 name is Paul Rowan, as you know, and this is 12 Ms. Mackey and our solicitor Ms. Cummins. 13 Ms. Mackey would like to ask you some questions. My 14 15 MR. STAKELUM WAS INTERVIEWED AS FOLLOWS BY 16 M S . MACKEY 17 MS. MACKEY: 18 Mr. Stakelum, today I want to concentrate 19 specifically on two issues, one with your own 20 personal affairs and the other are your clients. 21 I want to go back, have you a copy still of your 22 statement. 23 A. 24 1 Q. I do, yes. I want to go back and have a look at that. Now you 25 say in it, at paragraph four, that in dealing with 26 your clients you used the facilities of Guinness and 27 Mahon to dialogue with Mr. Traynor. 28 really like to get clear is, you were telling us on 29 the last occasion that when your clients wanted What I would 1 their fund monitored, which is the word you used, 2 you would approach Mr. Traynor, do you recollect 3 this? 4 5 2 Q. What I was wondering is, on the first occasion that 6 you did this what led you to believe that you could 7 approach Mr. Traynor in order to assist with the 8 monitoring of your clients funds? 9 A. It is difficulty to recall. Mr. Traynor and I were 10 close personal friends and we would have had a lot 11 of business dealings together. 12 obviously of the existence of Guinness Mahon Caymen 13 Trust, I don't know what conversations would have 14 taken place but I would have equally been aware that 15 there was a facility available for having funds 16 handled abroad. I believed all along that up to 17 recently that they were in what was then known as 18 Guinness Mahon Caymen Trust and later Ansbacher but 19 other matters arose which meant that they could have 20 been in Guernsey or some place. 21 3 Q. I was aware In your understanding of the thing at the time then 22 when you approached Mr. Traynor in relation to your 23 clients funds you approached him in the belief that 24 you would avail of a service for your clients in 25 Guinness Mahon Caymen Trust, that was your 26 understanding at that time? 27 A. 28 4 Q. 29 Yes, that's right. I see. Now, can I ask you one other question of a very general nature, can you tell me what company 1 2 Clyde Enterprises is? A. 3 Clyde Enterprises is not a company, it is a business registration name. 4 5 Q. 5 A. Yes? One of the needs of the clients would be 6 occasionally to withdraw funds from funds abroad. 7 One didn't know how much or how often or how 8 immediate their needs would be . I had an Irish bank 9 account which was in the name of Clyde Enterprises, 10 where I would keep a float of funds to meet the 11 needs. 12 requesting £5,000 in cash and that would be supplied 13 within probably 24 hours but the source of feeding 14 that account would be withdrawing funds from 15 offshore and they would be lodged into Clyde 16 Enterprises. 17 6 Q. 18 A. 19 You might get a phone call in a morning How would that happen? I would make a request to Guinness Mahon to write me out a cheque. 20 7 Q. 21 A. 22 8 Q. 23 You would? Yes. So, the situation was this, there was always a certain float in this account? 24 A. 25 9 Q. Yes. And a client would come to you for an amount of 26 money that you could give him from that account, so 27 you could deal with that yourself. 28 withdraw the money from the Clyde Enterprises and 29 give it to the client? You would 1 2 10 Q. 3 was...(INTERJECTION)? 4 A. 5 11 Q. 6 A. 8 12 Q. 9 A. 10 13 Q. 11 A. 13 14 Q. 14 A. 15 15 Q. 16 A. 17 16 Q . A. 20 17 Q. A. 23 18 Q. When you saw it needed to be topped up you then Guinness Mahon. Who in Guinness Mahon? It could be Mr. Traynor. Well would it usually be Mr. Traynor? You are talking about a long time ago, a lot of the Yes. I would say probably Mr. Collery would be the guy. Mr. Collery or Mr. Traynor. You would ask them to No, I would ask them for a draft payable to that Where would that draft come from, whose money would that be? A. 27 29 Yes. account. 25 28 You kept it? put that account in funds? 21 26 Me. time he -- because I would be meeting him anyway. 19 24 Was it you or was it Mr. Traynor who kept an eye on approached who? 12 22 Sorry? whether that needed to be topped up? 7 18 Did you keep an eye on whether that account That would be clients funds, from the account wherever the clients funds were abroad. 19 Q. The account you referred to on the last day that you were here was the Hotchpotch Account. 1 A. 2 20 Q. 3 Exactly. So, out of that would come funds into Clyde Enterprises ? 4 A. 5 21 Q. That's right. If we could get on then to more specific matters, 6 Mr. Stakelum. 7 think, yes, at paragraph four, that you never had 8 any personal dealings with Ansbacher? 9 A. 10 22 Q. 11 A. 12 23 Q. You told us in your statement, That's right. Is that correct? Yes. Did you ever have an Ansbacher trust, did you ever 13 have an account in Guinness Mahon Cayman Trust 14 yourself? 15 A. 16 24 Q. 17 I No. Were you beneficially entitled to any funds at all in the Hotchpotch Account? 18 A. 19 25 Q. 20 A. 21 26 Q. No. Or in Ansbacher at all? No. Right, could I ask you to look at some documents, 22 Mary page 33 please. Now, this is a letter from 23 Mr. Traynor to Mr. Humphries in Guinness and Mahon 24 on the 1st August 1990, referring to an account 25 number 13154973 and asking him to apply interest to 26 date on that account. 27 to have travellers cheques to the value of $6,000 28 issued in the name of John J. Stakelum, in 29 denominations of $100. Then he asks him to arrange The balance on the account, 1 the account referred to above, can be used to meet 2 the charges and the balance of charges due should be 3 debited to Ansbacher Ltd Account number 13154 602. 4 These are travellers cheques in your name 5 Mr. Stakelum debited to Ansbacher, can you explain 6 that to me? 7 A Number one I don't remember it, number two the 8 Ansbacher Ltd Account number I have never had any 9 knowledge of that. 10 27 Q 11 A 12 28 Q 13 A 14 Right. But I could explain it. Right? The situation would be that I had the Hotchpotch Account which was analysed each month. 15 29 Q 16 A Yes . Monies might have been drawn from that to Clyde to 17 feed funds to clients who would want to withdraw and 18 the reverse could be also true. 19 30 Q 20 A The reverse, what do you mean the reverse? The clients might give me money occasionally in 21 Irish pounds and if for instance client A wished to 22 withdraw -- and I will make it simple because it 23 wouldn't be quite as simple as that -- if client A 24 wished to withdraw £5,000 from funds abroad and 25 client B wished to lodge them there no funds need 26 move at all. 27 31 Q 28 A 29 Yes . There would just be a credit to one client and a debit to another. These would happen each month at 1 2 32 Q 3 A 4 5 Yes . That could be exactly in connection with that, that funds would be taken out there and debited to me. 33 Q 6 These were not funds been taken out, these were travellers cheques in your name? 7 A 8 34 Q 9 A Yes . This was obviously something for your personal use? Yes, but I would have to do a journal entry to 10 charge me with that and credit -- you see, all the 11 funds balanced every month. 12 35 Q 13 A Yes . So, whatever withdrawals might be from a situation, 14 whoever they would be for, somebody would have to 15 get 16 36 Q 17 A 18 37 Q the necessary credit. Yes . And that is what would happen. Yes, maybe I am being very slow on the uptake here 19 but it seems to me that if you were getting 20 travellers cheques, which was something for your 21 personal use, then this was being paid with money 22 that was your money? 23 A 24 38 Q But paid in the Irish scene, paid through Clyde. Well, perhaps. Can we may be look at another 25 document at page 327. 26 the account of Ansbacher Ltd care of Mr. J. D. 27 Traynor, 42 Fitzwilliam Square, Dublin 2. 28 actually an Ansbacher statement and if you see in 29 the middle of it, just to the right of the name and Now, this is a statement of So, it is 1 address of Mr. Traynor, you will see "Ansbacher 2 Limited, reference A/B Special, copy statement". 3 this is a copy statement of a coded account, coded 4 A/B Special. 5 corner, it is very very hard to see, the photocopy 6 is quite bad, but you will see the figures 54973, do 7 you see that, on the top on the left-hand corner? 8 A 9 39 Q 10 A 11 40 Q So Now, way over on the top left-hand 1315...(INTERJECTION). 13154973. Right. Now, if we go back to the document that I showed you 12 a few minutes ago about your travellers cheques that 13 is headed "Re Account No. 13154973". 14 date of that letter requesting the travellers 15 cheques is the 1st August 1990, do you see that? 16 A 17 41 Q You see the Yes, sorry, yes. So, it is 1st August 1990 referring to Account 18 13154973. 19 A/B Special and we see that it is entitled 13154973 20 an external call deposit account US dollars. 21 look at the date of the 8th August 1990, the last 22 entry, we see travellers cheques $6,000. 23 is clearly the account referred to in the letter of 24 Mr. Traynor. 25 and it is from this that your travellers cheques 26 have come. 27 Well, I mean, I accept that the travellers cheques 28 in dollars would have come from an offshore account. 29 I never saw that account before and I suspect that We go back to this Ansbacher Account So If we that This is Ansbacher coded dollar account 1 is only an offshoot of what I call the Hotchpotch 2 Account. 3 4 A. 5 6 Because that just shows a balance brought forward of $6,Oil,50. 43 Q. I will be able to show you in a minute where that 7 came from. 8 which indeed may well be the Hotchpotch Account, 9 nevertheless this is a specific account "A/B In fact, the account that it came out of 10 Special" which appears to have been opened and 11 closed for the purpose of the one transaction and it 12 appears to be an account totally for your benefit? 13 A. Yes, I wouldn't deny that I would have got say 14 $6,000, I mean I don't remember it but I might have 15 got $6,000. 16 an account in Ansbacher. 17 I suspect that that is an entry within Guinness and 18 Mahon records where they...(INTERJECTION). 19 4 4 Q. 20 21 But I personally would never have had If that was for my benefit Sorry, this is not a Guinness and Mahon document at all, this is an Ansbacher statement? A. Sorry, an Ansbacher care of J. D. Traynor, 42 22 Fitzwilliam Square, I mean I don't know what 23 accounts he may have kept and where he kept them or 24 under what heading. 25 there was ever an account of drawing $6,000 out, 26 like the suggestion there is did I put $6,000 in if 27 it was mine because there is an opening balance of 28 $6,011. 29 It wouldn't strike me that 1 2 instead of just debiting a Hotchpotch account or 3 something they may have transferred or whatever. 4 46 Q. That is what they did do, Mr. Stakelum, I quite 5 appreciate that. 6 maybe I could approach it another way? 7 obviously required travellers cheques for whatever 8 reason, do you recollect ever seeking to get 9 travellers cheques from Mr. Traynor? 10 A. My point is slightly different, You To tell you the truth, I do not but I did operate a 11 situation in AIB in Jersey and I remember once and 12 once only getting $10,000 worth of travellers 13 cheques. 14 Mr. Traynor, but I mean, I accept the fact that I 15 may have or did, it seems like it. 16 47 Q. I don't ever remember getting them from Clearly you did. Just supposing for a moment, and I 17 accept that you can't remember doing so, but if you 18 had wished to do it, you would have gone to 19 Mr. Traynor and you would have asked for travellers 20 cheques on what basis; where would you have thought 21 they would come from? 22 A. Mr. Traynor didn't know what was in the Hotchpotch 23 Account or why they were there. 24 month a number of journal entries where I would be 25 debiting and crediting people for whatever 26 transactions they would take. 27 48 Q. 28 A. 29 I would have every Yes. I obviously would have paid for them through say Clyde and withdrew from that situation the money 1 because that was the convenient place of getting the 2 dollars. 3 49 Q 4 A 5 You would have paid for them? Yes, I would have taken the debit through my entries for Clyde Enterprises. 6 50 Q 7 A Yes . Like I would, if you like, debiting Jack Stakelum 8 with the equivalent of $6,000 and crediting somebody 9 else . 10 51 Q 11 But the money in Clyde Enterprises was your clients money, isn't that right? 12 A 13 52 Q 14 A That's right, yes. So, Jack Stakelum would never have been debited? Well, I mean, I would pay if there was a need for me 15 to pay for whatever it was I would pay for it, I 16 would make a lodgement in Clyde presumably. 17 53 Q 18 19 Why would you need to do that, when all you had to do was top it up from the Hotchpotch Account? A 20 If it was my personal drawings I would have had to pay for that. 21 54 Q 22 A 23 55 Q 24 A 25 56 Q Right. One place or the other. Yes . I didn't have foreign funds. Why do it this way? Why would you not just go into 26 a bank and get your travellers cheques in the normal 27 way? 28 I don't know. 29 circumstances of the transaction would be. I mean I can't remember what the 1 57 Q. All right, maybe we could look at something else. 2 Could we look now at page 34, please. This is a 3 letter from Joan Williams this time to the Irish 4 Intercontinental Bank. 5 1992 and it is referring to an Ansbacher Account in 6 the Irish Intercontinental Bank. 7 A/B Special so it is the one we have been looking at 8 before but this time moved, as all the Ansbacher 9 accounts did in 1991 to IIB, so it has a slightly 10 It is dated the 9th June Again, it is the different account number attached to it. 11 12 This time Ms. Williams is asking to let her have for 13 collection a US dollar draft for $2,000, payable to 14 you and drawing again on this A/B Special Account, 15 what might that be? 16 A. 17 58 Q. I know that I never had any dealings with IIB. I accept that you may not be aware that the 18 Ansbacher accounts had moved to IIB but they had and 19 therefore anybody dealing with the Ansbacher 20 accounts after 1991 was unknowingly dealing with IIB 21 because that was where they were kept, they were no 22 longer in Guinness and Mahon. 23 withdrawing a draft for $2,000? 24 A. 25 Would you recollect No, I would absolutely believe that that wasn't for my personal benefit. 26 59 Q. 27 A. This may have been for one of your clients? Yes, I have no recollection of it but I mean, I 28 would accept $6,000 in drafts as being a need that I 29 might personally have if I was travelling to the 1 2 60 Q 3 A 4 5 61 Q So, is your evidence then that this is a withdrawal for your client? 7 A 8 62 Q 9 Well, I ... (INTERJECTION) . Would you not have withdrawn from Clyde Enterprises for your client? A 11 12 I would not accept that I had a need for a personal $2,092 draft. 6 10 Yes . It is a dollar draft, so there was some reason for a dollar and I don't know what it is. 63 Q Very well, we will move on again anyway. Mary if we 13 could look at page 3 8 . 14 9th January 1990, from Mr. Traynor again, to 15 Mr. Lanigan O'Keeffe in Guinness and Mahon and he 16 says : 17 Now, this is a letter of the "Could you please let me arrange to have a Sterling Draft for Stg. £6,500 payable to Clare Stakelum. The debit should be to Ansbacher Sterling Account". 18 19 20 21 And it gives the number. 22 relative of yours, Mr. Stakelum? 23 A 24 64 Q 25 A Is Clare Stakelum a Yes . Your daughter? No. She would be a daughter of a cousin and that 26 would be on behalf of -- like her father who was 27 alive at the time, I mean I don't recollect it now. 28 65 Q 29 A Who was her father? He was a Mr. Connor Stakelum. 1 66 Q 2 assisted? 3 A 4 67 Q 5 A 6 68 Q 7 8 Was Mr. Connor Stakelum on of the clients that you Yes . Was he your brother? No, cousin. Was he one of your clients within your own memorandum account system? A 9 Yes, or his company, which would be Stakelum's Hardware Limited. 10 69 Q 11 A 12 70 Q 13 A 14 71 Q So, this was his daughter? Yes . Do you have a daughter Clare Stakelum? No, that is the only Clare Stakelum I know. I see. Moving on again, can we look at page 36, 15 Mary, please. That is a memorandum of Des Traynor to 16 Pat O'Dwyer, much earlier, it is the 5th August 1980 17 and it says: 18 "This is to confirm having requested you to purchase Stg. £500 in travellers cheques in the name of Patricia Stakelum, Innismann, Queen's Park, Monkstown, Co. Dublin, and to debit the cost of £505 to G.M.C.T. Guinness Mahon Cayman Trust, Sundry Sub-Company Account. 19 20 21 22 Also, to purchase IR.£300 worth of Escudos and to debit the amount to Amiens S/L Account. 23 24 When you have the above ready please contact Jack Stakelum directly". 25 26 27 Is Patricia Stakelum your wife? 28 A 29 72 Q She is. Here we have your wife getting travellers cheques 1 and the amount being debited to the Guinness Mahon 2 Caymen Trust Account in 1980. 3 what that might be about or how that could be 4 explained? 5 A Can you recollect It looks like that with the Escudos that she may 6 have been travelling to Portugal or something like 7 that. 8 73 Q 9 wanted it, it is where it was coming from. 10 11 It does, yes, but my interest is not so much why she It was coming from the Ansbacher Account. A All I can explain about that is that I didn't have 12 an Ansbacher Account per say and I didn't have any 13 benefit from the Ansbacher and the balances were 14 clients funds; but there would have been a facility 15 there in the sense that there were foreign funds to 16 draw funds from and I would have replaced whatever I 17 would have taken, either directly there or through 18 say the Clyde Enterprises Account. 19 74 Q 20 A 21 75 Q Right. But I don't remember the particular transactions. In either of the transactions that we looked at your 22 own travellers cheques or this one, is there any 23 instruction to debit the Clyde Enterprise Account? 24 In each case it is an Ansbacher Account that is 25 being debited? 26 That is not my instruction, that's Mr. Traynor's 27 instruction presumably and I don't know what 28 accounts they are dealing with because I wouldn't 29 have access to their coding, no more than they would 1 2 have any access to Clyde Enterprises. 76 Q. I see. Can we now look at page 46. Just before we 3 pass that can I ask you, Mr. Stakelum, are you 4 familiar with the phrase "suitably secured"? 5 A. 6 77 Q. 7 8 Yes. Are you familiar with the explanation that Guinness and Mahon give for that phrase? A. 9 Yes, I have contested it on a few occasions with the Moriarty people in private because there were some 10 situations there where they believed there was a 11 back-to-back and I knew there wasn't in the sense of 12 how far one would know. 13 those that evidently the belief was that the phrase 14 "suitably secured" or "adequately secured" in 15 connection with reviewing a loan meant that there 16 were funds elsewhere backing that. 17 78 Q . 18 A. 19 79 Q. There are situations about Yes. I contest that, I accept...(INTERJECTION). You may contest it Mr. Stakelum, but it is the 20 evidence nevertheless of Guinness and Mahon to us 21 that is what it means. 22 A. 23 80 Q. 24 A. 25 Oh, yes, but...(INTERJECTION). So, I would now like you to look at a document here? Before I even look at the document I would like you to hear me out in connection with it. 26 81 Q. 27 A. Right? There were certainly situations I am aware where the 28 words "suitably secured" and "adequately secured" 29 was used by Guinness Mahon where I certainly believe 1 there was no back-to-back. 2 wasn't a general rule but it could also have applied 3 if there was an instruction given to consider that 4 it was so, or that there was a cast iron guarantee 5 or something like that or indeed maybe where 6 Mr. Traynor may have given instructions. 7 Furthermore, 8 there were back-to-backs where the clients weren't 9 aware of them. 10 82 Q 11 A 12 83 Q I am not saying it I believe there were situations where Yes . And there were reasons for them. That may well be the case where the client wasn't 13 aware but if there was such a back-to-back and the 14 client was unaware of it nevertheless it meant that 15 there were funds there to be able to back it up? 16 A 17 18 Not necessarily the clients though, that is the point that I am making. 84 Q I see. Can I ask now you to look at this 19 Mr. Stakelum. 20 and Mahon in 1974, showing lists of certain resident 21 loans of over £10,000 and you appear there for two 22 loans. 23 secured"; do you recollect this loan, Mr. Stakelum, 24 the loan for £40,000 with a repayment date of 1975? 25 A 26 85 Q 27 A 28 86 Q 29 It is a loans listing from Guinness The second one down has beside it "suitably Is there a date when the loan was granted. No? Yes. I don't recall the top one. Well it is not the top one that I am interested in. It is the second one, the one that is described as 1 2 "suitably secured"? A. Yes, I can. It is just that the repayment date 3 puzzles me. If I may explain? 4 Haughey Boland and Company and I left there on 1st 5 December '75, prior to that, Des Traynor had left 6 maybe in 1970 or 1971, some time after he joined 7 Guinness Mahon and my recollection is we were -- the 8 top rate of tax in this country was maybe in the 9 order of 80%. When I was in He came to me and he said there was a 10 scheme, a very legitimate scheme, for mitigating 11 your tax and what we did at the time and it would be 12 entirely he, because I wouldn't have had any funds 13 whatsoever of any nature, is he arranged for 14 Guinness and Mahon to loan me £40,000 on which I 15 would pay interest. 16 and that's why I am not sure of the ten at the top. 17 I don't know what that is. 18 borrowing and that interest at that time was allowed 19 for tax purposes. That is the figure I remember It was a personal 20 21 The £40,000 was given as -- I am trying to remember 22 this as a scheme, it's a long time back, -- £40,000 23 was loaned to a company, presumably in Caymen and 24 earned interest there. 25 differential but I would have paid the gross 26 interest here and claimed it for tax. 27 the date puzzles me about '75, 28 repayment date. 29 87 Q. There would be certainly a That is the repayment date. This is why maybe that was a 1 But I think it might have been paid back before 2 that. 3 88 Q 4 there...(INTERJECTION)? 5 A 6 89 Q 7 8 I think it was because we see Would it have been paid back before March '74? It could have been because the comment there it says, due to interest since repaid? A 9 I think it was paid back before March '74 because in April '74 capital gains tax came in and the concept 10 was that you liquidated the company in the Caymen, 11 which now had a worth of, well let's say £43,000 or 12 something, 13 which was a tax free gain, quite legitimate, but in 14 the meantime you had the advantage of having the 15 interest paid having allowed for tax. 16 90 Q 17 A I am not sure what the figures were, Yes . A perfectly legitimate scheme, liquidated, in my 18 view, at March '74 because capital gains tax was 19 coming in and the benefit of that would have been 20 lost then. 21 91 Q 22 A What was the name of company Mr. Stakelum? I have no idea. I have no idea, I had no money. It 23 was a thought put to me by Mr. Traynor, I wouldn't 24 have known of the existence of the ability or tax 25 advantage, but they lent me the money and they never 26 gave me the money, if you like, it was lodged there, 27 so, I suppose they had that as security for it all 28 the time and it was liquidated then in March '74, a 29 once off. 1 92 Q 2 A The interest that had been earned on it was yours? Yes, when the company was liquidated, capital gains 3 tax. 4 on interest here, but the advantage would have 5 arisen to me and the tax deduction. 6 93 Q It would be less than what they would have got The Caymen company that had control of those funds, 7 obviously invested it some where so that they would 8 earn interest? 9 A 10 94 Q 11 A 12 95 Q No, no, the £40,000 loan that was granted to me. Yes . Was evidently placed into that company on deposit. The company was not a bank. I presume it was a 13 company incorporated in Caymen. 14 have to deposit that money somewhere, isn't that 15 right? 16 A The company would Presumably it was within the banking structure of 17 the Guinness Mahon or the Guinness Mahon Cayman 18 Trust, I don't know. 19 96 Q 20 21 wouldn't that be the case? A 22 23 Presumably Guinness Mahon Caymen Trust, most likely, Right, because it would be outside the jurisdiction so it wouldn't fetch tax liability. 97 Q This money loaned to you by Guinness and Mahon would 24 have been on deposit in Guinness Mahon Caymen Trust, 25 which would explain why your loan was described as 26 suitably secured, wouln't that be the case? 27 28 29 A I would never have got a penny into my hands for that, they held the money all the way. 1 I don't know whether it would be lodged in Caymen 2 Trust, you see you have the thing that it could have 3 been, for instance, a Caymen company that lodged the 4 money in Dublin. 5 £40,000 sitting side by side 6 because...(INTERJECTION). 7 99 Q 8 I mean they could have had the But wouldn't it have had to be offshore for the thing to work? 9 A 10 100 Q 11 A 12 It is the ownership of the funds that was offshore. Yes . I mean if a foreign company lodges money in Dublin it would be tax free, you know. 13 101 Q 14 A Yes . So, I wouldn't know where that was. Mr. Traynor 15 merely came to me, like it worked but it was only 16 for a relatively short period of time because 17 capital gains tax was introduced, it might have been 18 a year or two. 19 102 Q 20 A 21 103 Q 22 23 Yes . Or something like that. The interest that had accrued on that did you leave it there? A No, no. That was a capital gains tax, the interest 24 had accrued because the company was liquidated so I 25 would have taken it back and that would have been 26 what paid off the loan. 27 104 Q 28 A 29 Yes . What I would have got into my hands, I would have presumably paid the interest up front and then they 1 got the capital gain back which would be something 2 less that that interest would have been. 3 105 Q 4 A 5 6 I see . I remember the other loan too now, but that is of no interest to you, no? 106 Q It is not, no. Now, can I ask you to look at page 7 69 please. 8 Mr. Traynor to Guinness and Mahon dated the 6th 9 September 1990, referring to Ansbacher Limited This is another document a letter from 10 account A/B-CZ. 11 that we have looked at before and he says: This is a different one to the one 12 "Dear David, 13 The above deposit matures on 10/9/90. 14 On that date could you please arrange to let me have a cheque for IR£1,500.00 payable to Business Enterprises and roll the balance of £63,462.88 for one month". 15 16 17 18 Now this was the situation where a sum of money, a 19 specific sum of money, was clearly on fixed deposit 20 and your company Business Enterprises seems to have 21 been able to draw apparently the interest from that 22 before it was rolled over to another fixed term. Can 23 you suggest what that might be about? 24 A 25 Yes, I think so. Do you remember you mentioned Clyde Enterprises? 26 107 Q 27 A 28 108 Q 29 A Yes . That is a business registration name not a company. Yes . Prior to Clyde Enterprises we had a business 24 1 registration named Business Enterprises and I 2 suspect that is what that is, to be payable to 3 Business Enterprises and that would have been duly 4 paid out to whatever client. 5 this but I mean that is what I can assume. 6 not Business Enterprises Limited and there was a big 7 distinction between the two. 8 109 Q 9 A I obviously don't know That is I see. I don't know what that is. If that were Business 10 Enterprises Limited, I can only assume that would 11 have been an invoice from Business Enterprises 12 Limited to somebody who was being paid some fee for 13 something. 14 limited. 15 110 Q 16 A 17 Yes . Then it would be like a payment into Clyde for interest earned. 18 111 Q 19 A 20 21 If it is Business Enterprises not I see . Some client may have wanted to withdraw his interest, 112 Q I have no idea. Clearly if this was one of your clients then it was 22 a client who hadn't got his funds in the Hotchpotch 23 Account but had a very specific fixed deposit. 24 That's right. 25 Hotchpotch Account but you could have had situations 26 where 27 generally on a rollover of one month's interest; but 28 some clients would specifically want say a three 29 month and that might be segregated. Generally speaking it was a -- the Hotchpotch Account merely earned money 1 113 Q 2 A 3 When I say segregated, Guinness Mahon wouldn't have knowledge of who they were. 4 114 Q 5 A Right. Let's say well £60,000 on three months at whatever 6 but as far as I was concerned it was all a 7 Hotchpotch Account. 8 115 Q 9 How would you be able to account to your particular client for this since Guinness and Mahon wouldn't 10 know to tell you who the client was. 11 know how this client account was doing. 12 means would Guinness Mahon communicate? 13 A Every month we reconciled. How would you By what Every month with 14 Guinness Mahon, the totality of the funds and every 15 month I would have reconciled the balance on Clyde 16 Enterprises Account. 17 116 Q How would you describe this account if you wanted 18 information on it since Guinness and Mahon didn't 19 know who's it was? 20 A I really don't know. I really don't know, I mean it 21 might be when we are sitting down or talking over 22 the telephone about it like, 23 £60,000 on deposit", or there might be other ones 24 etc, what were they and get information about them. 25 It is clear that Guinness and Mahon described this 26 account by a code, 27 to David Humphries referring to that. 28 how Guinness and Mahon saw that account, it was an 29 account described as "Ansbacher Limited Account "and what about the "A/B-CZ", Mr. Traynor is writing So, that was 1 A/B-CZ". 2 Yes, I mean I have no idea what coding they were 3 using or reference. 4 118 Q 5 A I understand that. To tell you the truth I thought I knew everybody in 6 Guinness Mahon, I don't ever remember David 7 Humphries. 8 119 Q 9 Well leaving aside that for a moment, would Mr. Traynor have known the identity of this person? 10 A 11 120 Q The probability is not, but I don't know for sure. Well then this brings me back, if Mr. Traynor did 12 not know who it was but gave it a code, you knowing 13 who it was, then in order for Mr. Traynor to tell 14 you about this he had to refer to it by the code to 15 you, didn't he, what other way could he refer to it? 16 A No, he wouldn't, he wouldn't. Was he still in 17 Guinness and Mahon? 18 Mahon at that stage if he is writing letters from 19 Fitzwilliam Square. 20 121 Q 21 A 22 23 No, he wasn't in Guinness and Yes . So, I probably wouldn't be dealing directly with Des Traynor in connection with that at all. 122 Q Well that is even more puzzling then, how would 24 Guinness and Mahon be able to tell you how this 25 client's account was doing other than by referring 26 to it by this A/B-CZ? 27 Because if I was sitting down 28 that many accounts involved like -- if I was sitting 29 down and I was talking on the telephone to somebody -- there wouldn't be 1 and if I wanted to reconcile balances at the end of 2 month and at that stage if Mr. Traynor was gone it 3 would probably have been Padraig Collery, then I'd 4 be saying, like on the general account how much is 5 the interest earned and agreeing if there were 6 withdrawals, etcetera, etcetera, and what about on 7 the £60,000. 8 123 Q. 9 A. You could refer to it like that? I think that's the most logical way to refer it 10 because I don't know that we would -- 11 have many separate accounts, we might have had 12 dollar accounts as well but we wouldn't have had any 13 separate accounts, so, there wouldn't be a problem 14 in identification. 15 seven or eight or ten or twelve we'd only be talking 16 about a few accounts, you'd probably refer to them 17 as the principal sum. 18 because if there was a reference on those accounts 19 that reference would be a thing that Guinness and 20 Mahon would use rather than me. 21 124 Q. we wouldn't I mean I wasn't talking about That's not being coy about it Mr. Stakelum, if I could just go back over what your 22 evidence has been this morning at least on this 23 point. We have seen that you and members of your 24 family had funds withdrawn from Ansbacher, debited 25 to Ansbacher for their personal use, now as I 26 understand it your explanation for that, I am still 27 not terribly clear about it, but if I am wrong now 28 in what I say correct me. 29 1 Your explanation is that you might withdraw funds 2 like that for your personal use and then repay it 3 back into Clyde Enterprises, is that right? 4 5 125 Q. Then in respect of your suitably secured loan or 6 what you described as a suitably secured loan, your 7 evidence is that Mr. Traynor had explained this 8 particular type of tax avoidance scheme? 9 A. 10 12 6 Q. That's right. Whereby you would borrow money from Guinness and 11 Mahon and it would be put offshore in the name of a 12 company, a foreign registered company, where it 13 earned some interest. 14 off the interest here which you would be able to set 15 off against tax. 16 the interest that had accrued on it would be a 17 capital gain to you? 18 A. In the meantime you would pay When the company was liquidated That's right, absolutely. There is the possibility, 19 I don't remember, that instead of paying off the 20 interest here which would effect a cash flow because 21 I wouldn't have had many means at that time, they 22 may have deferred the collection of interest, the 23 charge for interest would be allowed for tax 24 purpose. 25 interest until the company was liquidated. 26 think there was a long period of time in that 27 because capital gains tax coming in nullified the 28 effect of that. 29 127 Q. They may have deferred the collection of I don't I don't have any further questions to ask you about 1 2 Mr. Stakelum. 3 questions on another point now and I will come back 4 later to the issue of your clients. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Mr. Rowan would like to ask you some 1 2 3 MR. ROWAN: 4 Before I ask you some questions about another 5 aspect may I just clarify something? 6 that the Caymen company to whom the £40,000 had been 7 loaned was liquidated and that produced a capital 8 gain for you, who owned or controlled the Caymen 9 company? You explained 10 Entirely done by Guinness and Mahon. 11 wouldn't even remember the name. 12 through to me as me being very close to Des Traynor 13 and he had to obviously -- Guinness and Mahon -­ 14 offer me the facility to put the £40,000 away so to 15 speak, because I didn't have those kinds of funds 16 and it was purely a legitimate means of some tax 17 avoidance at the time. 18 128 Q I mean I That was put Would you agree with me if I suggested that on the 19 liquidation of a company the shareholders would be 20 the beneficiaries of any increase in the value of 21 any of the shares? 22 A 23 129 Q 24 A 25 130 Q 26 A 27 131 Q 28 A 29 132 Q Yes, presumably I would...(INTERJECTION). Would that not be correct? I think so, yes. Were you a shareholder in that company? I must have been, I mean I think I must have been. You said a moment ago that you didn't know that? Well I don't remember. Can we have this straightforwardly please, 1 Mr. Stakelum, you were a shareholder in that Caymen 2 company were you not? 3 A 4 133 Q I believe I must have been. Thank you. Earlier in the interview you explained 5 that Clyde Enterprises was a trading name or a 6 business name, is that correct? 7 A 8 134 Q 9 A 10 135 Q 11 A 12 136 Q 13 A 14 137 Q 15 A 16 138 Q 17 A 18 139 Q 19 A 20 140 Q Business registration, yes, that's what it is. So, it was just a business name? That's right, it is registered. A registered business name? Yes . Registered with? Me as the proprietor. With you as the proprietor? Right. Registered with the business names registry? Exactly. It had a bank account with which bank please? AIB. When you required further monies you asked for money 21 for withdrawal from GMCT, for Mr. Traynor and a 22 draft would be produced a a result of that request? 23 A 24 141 Q 25 A 26 142 Q 27 That's right. Which you lodged into the AIB bank account? That's right. And arising from that you them made payments to your clients ? 28 A 29 143 Q Right. When your clients were depositing money with you to 32 1 go to GMCT did you lodge those moneys into you AIB 2 account in the name of Clyde Enterprises? 3 A. 4 144 Q. Sometimes, if they were Irish funds. Mr. Stakelum, I think as customary at about this 5 time in the morning we stop for a cup of tea or 6 coffee, I think you know the routine, we are going 7 to do that now for ten minutes or so. 8 9 SHORT ADJOURNMENT 10 11 145 Q. MR. ROWAN: Mr. Stakelum when you were 12 last here for interview we 13 explored with you a certain amount of how much 14 contact you had had with Mr. Traynor and Caymen 15 Trust and so on, it was a somewhat disjointed 16 discussion at times and we wanted to clarify some of 17 the matters which seemed not to have been adequately 18 dealt with. 19 may? That is what I want to do now, if I 20 21 I think you indicated to us last time that from 22 approximately 1956 to 1958 you worked as a article 23 clerk, if I may use that term, which I think was the 24 term relating to the day? 25 A. 26 146 Q. 27 28 29 Right. What sort of work did you do as an article clerk, broadly? A. It was a relatively small practice. There was just Charlie Haughey and Harry Boland, the two partners. 1 Des Traynor would have been manager. 2 been shortly qualified around '55/'56. 3 maybe six to eight article clerks, I think there 4 were four each allowed, 5 of secretaries, mostly auditing work. 6 147 Q 7 He would have There were I am not too sure. A couple So you would have been working as a junior on an audit team or a series of audit teams? 8 A 9 148 Q 10 Arguably, yes. Mr. Traynor, as you have just said was a manager at that stage, a qualified manager? 11 A 12 149 Q 13 A 14 150 Q 15 Yes . He would have been heading up audits? That's right, yes. Did you work with him as a junior on some of those audits ? 16 A 17 151 Q 18 A 19 152 Q Yes, very closely I would say. Did you work with him quite a bit? Yes, quite a bit. In those days, I think I am correct in saying, that 20 the Institute of Chartered Accountants and you are a 21 chartered accountant I believe? 22 A 23 153 Q 24 That's right. The Institute of Chartered Accountants exams were five parts, if I recall? 25 A 26 154 Q 27 A 28 155 Q 29 A No. They weren't? No. How many parts were there? Intermediate and final, two parts. 1 156 Q Right. Can you recall the sorts of subjects that 2 would have been included in those examinations? 3 What sorts of subjects did you have to answer on? 4 A There would have been to final maybe there was, as I 5 recall about 16 subjects covered in eight papers. 6 There would have been accounting one and two, 7 executive accounting, partnership accounting, branch 8 accounting and general accounting. 9 been two papers. They would have There would have been a paper on 10 auditing, that is three. 11 taxation, 12 would called cost accounting, would be five, that's 13 now management accounting I think. 14 been company law, six. 15 have been eight papers done in my final anyway. 16 157 Q four. There would be a paper on There would be a paper on what we There would have I don't know, there would I think you have provided me with the piece of 17 information that I was looking for, there was a tax 18 paper? 19 A 20 158 Q 21 A 22 159 Q 23 24 There was. Covering personal tax and corporate tax? That's right. Thank you. Then from around 1962 when I think you indicated you qualified? A 25 I think '61 but I went back to Haughey Boland in '62, yes. 26 160 Q 27 A 28 161 Q What changed then in the sort of work that you did? 29 A Not a lot immediately except that I would have been But as a qualified senior? Yes . 1 the senior and taking charge of the audit for 2 clients. 3 in Haughey Boland and Company where I might have 4 been scheduling work for the other auditors in the 5 firm or the other employees and that but generally 6 heading up the bigger audits. 7 162 Q I also was in a kind of a managerial role So you were heading up the audits. To what degree 8 did you have responsibility for the taxation issues 9 which would usually have followed on from preparing 10 a set of accounts for a firm or a corporate entity? 11 A I don't know the exact date but at that time there 12 was a great tendency for the practitioners to employ 13 people from the revenue. 14 ex-inspectors of taxes in and the tendency would be 15 when you completed an audit that you probably 16 prepared the computation or if you didn't, you 17 certainly got all the information ready for the 18 computation and then you got it approved by the 19 tax department. 20 163 Q We would have had some During that period when you were a manager, 21 obviously with more responsibility than before you 22 qualified, did you then have a further opportunity 23 to work with Mr. Traynor? 24 A 25 number of assignments. 26 164 Q 27 A 28 29 Yes, we would have been very close together on a He was a partner at that stage? He was a partner when I went back in '62, that's right. 165 Q So the relationship changed from being a junior to a 36 1 manager; the relationship was one of manager to 2 partner? 3 A 4 16 6 Q Right. Did you work with him on his clients for which he 5 was the partner responsible. 6 manager on those clients? 7 A Yes, that's a fair comment. You worked with him as I think I would have 8 been displacing him from a lot of situations. 9 would have been moving on to other things. He I 10 remember very heavy work loads and one particular 11 client that was his responsibility and he kind of 12 unloaded onto me and I always said that was almost 13 the last straw, that he was almost severing himself 14 from the normal auditing work. We would have worked 15 very closely together, undoubtedly. 16 167 Q Nonetheless he remained as the partner to whom the 17 client looked in the first instance and you did a 18 lot of the work in preparing the data? 19 A 20 168 Q That's right. You have just indicated a moment ago that he moved 21 onto other things. 22 to specialise in some way? 23 Specialise, 24 I say that he moved onto other things he certainly 25 seem to extract himself a lot from the day-to-day 26 work. 27 of not working but there were things that he got 28 involved in. 29 very big way, he was certainly with a company called Does that mean that he started I don't know if that is the word. When He was a work-a-holic so it wasn't a question He got involved with clients in the 1 Merchant Banking and he would have at least every 2 Friday morning, always been at a board meeting 3 there. 4 he was always at a board meeting there and he would 5 get involved in other situations. 6 relate when the dates were. 7 to join Guinness and Mahon he got very involved with 8 projects that they were involved with, property 9 projects that the bank were involved in, he was in 10 11 I don't know if he was on the board now, but It is hard to I know before he left an advisory capacity. 169 Q Don't jump ahead too much. Let's try and keep the 12 thing in a logical flow. 13 client of Haughey Boland at the time? 14 A 15 170 Q 16 17 Was Merchant Banking a That's right. And that was one of the clients for which Mr. Traynor had a responsibility? A That's right but in addition to that, Matt Gallagher 18 would have been the owner of it and there were 19 groups of building companies there, I'm not sure 20 what they would have been but he would have been 21 very involved with that. 22 171 Q Merchant Banking, if I recall correctly, had a 23 subsidiary in Northern Ireland. 24 responsible for that? 25 A I don't have any memory of a Northern Ireland connection. 26 27 Was Mr. Traynor 172 Q Right. So he worked with Merchant Banking and 28 perhaps that give him an interest in the whole area 29 of being involved with banking situations? 1 A I don't think that was the reason that he ultimately 2 finished up with Guinness Mahon. I think there was 3 a very specific reason for that. I don't know. 4 We will come to that. 5 started to take a lot of responsibility for clients 6 of which Mr. Traynor was the partner. 7 became a partner? 8 A 9 174 Q 10 A 11 175 Q 12 13 Anyway the point was that you In 1967 you That's right. What age were you in 1967? 33. 33 right. Were you a general partner or did you have specialised responsibilities? A I think before he left, obviously we would have had 14 discussions about things, the partners and that. I 15 tended to specialise in liquidations and 16 receiverships because the appointment of liquidators 17 or receivers is a personal thing. 18 it is an individual that gets appointed a liquidator 19 so you have to push a name of an individual if you 20 were to become known in the field. 21 sufficient liquidations and receiverships at that 22 stage where it would be exclusive to all other 23 things; so to that extent I would specialise in 24 liquidations and receiverships but continue to 25 handle a number of auditing situations as well. 26 176 Q 27 It is not a firm, There weren't How much of your time would you have spent on those two main parts of your work? 28 A 29 177 Q The liquidations and receiverships? The insolvency work, if I may describe it as that, 1 2 A. I think it would have grown one way as opposed to 3 the other. Obviously when you came to liquidation or 4 receivership it was a fairly urgent 'fire brigade' 5 situation where you might have to go in immediately. 6 More and more it became that way. 7 I left Haughey Boland in '75 that I took something 8 like 43 or 44 liquidations or receiveships with me, 9 in the sense that it was a decision that I would I know that when 10 remain rather than resign and pass it onto somebody 11 else, and wrap them up. 12 178 Q. Receivership work is quite different from liquidation work, is it not? 13 14 A. 15 179 Q. 16 There are very distinct differences, yes. Can you just outline what you perceive were the differences in the early 1960's? 17 A. 18 180 Q. 19 A. Between receivership and liquidation? Yes? You were appointed liquidator almost after the fact 20 in the sense that the company had gone and had 21 passed its resolutions and appointed you liquidator. 22 That was a total question of winding up the company 23 and paying the creditors in the order in which they 24 were entitled to be paid. 25 181 Q. 26 So the company, effectively, had come to an end as a result of the liquidation. 27 A. 28 182 Q. 29 A. Exactly. Receivership? In the receivership area that wouldn't necessarily 1 be so. 2 but there was still the possibility that you could 3 revive the company if you could correct the problem 4 that had caused the receivership in the first place. 5 Your responsibility was to the debenture holder who 6 appointed you subject to certain other criteria but 7 you had no responsibility really to the general 8 creditors other than not to be negligent about the 9 assets . 10 183 Q It was very often a mortal blow to a company In what proportion of the receiverships were you the 11 principal, did you find yourself with a trading 12 receivership on your hands, approximately? 13 A 14 184 Q 15 A 16 185 Q 17 18 That was never wound up? No. You always traded for a while. Where you perceived it was possible to continue trading the business perhaps before passing it on? A Not many, because often and the tendency was that 19 people didn't seek to make appointments until the 20 companies were mortally wounded. 21 there were some. 22 186 Q 23 So the trading element of it was for a better realisation of the assets? 24 A 25 187 Q 26 27 But on occasions, Generally. Prior to your appointments as partner, who had done insolvency work in Haughey Boland? A I probably did a lot of it but either Mr. Boland who 28 was a partner or Mr. Traynor who was a partner. 29 Either one of them would have been the nominee. 1 188 Q 2 3 work? A 4 5 So Mr. Traynor understood something about insolvency Mr. Traynor was very brilliant on a cross-section of work. 189 Q 6 So, Mr. Traynor decided to leave Haughey Boland and join Guinness and Mahon? 7 A 8 190 Q 9 Yes . He was then an established partner in Haughey Boland? 10 A 11 191 Q Very much so. And a very able man as you have just said. Did that 12 decision come as a surprise to his partners and you 13 in particular? 14 A 15 192 Q 16 A I think the word would be shock. Why? Because he would have been, he was a work-a-holic. 17 He would have worked morning, noon and night. He 18 would have been a real corner-stone of the 19 partnership and he would have been considered a 20 massive loss to a relatively struggling partnership. 21 That's why it would have been a shock. 22 193 Q 23 A Nonetheless he decided to go? Yes. I don't recall the exact time but I suspect 24 that he would have come in at some partnership 25 meeting and his announcement wouldn't have been 26 that I am leaving next week, it would be that he was 27 leaving in some months time. 28 would have been substantially involved with work 29 connected with Guinness Mahon. But prior to that he He used to be with 1 them far more than with us in Haughey Boland at the 2 time . 3 194 Q 4 A When did he start to work with Guinness and Mahon? I am not sure when he left. I'm always confused 5 whether he left in 1970 or 1971. 6 31st March. 7 that. 8 taxation schemes with them. 9 wouldn't have known anything about it, whether I think it was the I'm not sure, a year or two before He worked on some property schemes and I'm not sure. I 10 Guinness and Mahon were financing them or taking 11 equity in them or what they might have been, but he 12 obviously made a very able contribution to whatever 13 they were doing because they invited him to join the 14 board in a very senior capacity there. 15 195 Q May I just enquire whether Guinness & Mahon were 16 clients of Haughey Boland or clients of other 17 people. 18 A 19 196 Q 20 21 No. Guinness Mahon, no. So that Mr. Traynor was actually providing special services of a non-audit nature to Guinness Mahon? A You have me thinking there because I would have been 22 very familiar with things like bills because I would 23 have looked after Haughey Boland's own accounts and 24 we never sent a bill to Guinness and Mahon but with 25 all the work he was doing who got paid for it, 26 think he was keeping his end up in Haughey Boland as 27 well, working nights and weekends. 28 At some point in his career he made contact with 29 Guinness Mahon and then got the opportunity to I 1 2 advise them on project related assignments? A. You are being very definitive about it. I think how 3 he came to their notice was maybe acting for some 4 client in some property situation where they may 5 have been another party to it and were very 6 impressed with him that's all I can say. 7 know. 8 198 Q. 9 A. 11 199 Q. 12 13 Having impressed them they made him an offer that he couldn't refuse. 10 I don't Is that what it sounds like? Absolutely. He went there as deputy managing director, joint managing director? A. I think joint managing director. The structure 14 there at the time, I think George Mahon was still 15 there and John Guinness was certainly there because 16 I had dealings with John Guinness afterwards. 17 there was a William Forwood who was a Solicitor. 18 don't know let's say whether George Mahon was 19 chairman and the other two joint Managing Directors. 20 I think when Des went in George Mahon may have 21 retired, John Guinness may have become Chairman and 22 he became joint Managing Director with William 23 Forwood. 24 could be slightly wrong there. 25 200 Q. Then I That would be what I would believe but I Here we have someone who was an experienced partner 26 in a small firm of chartered accountants, who had 27 had limited experience of banking, being invited to 28 become the most senior person or one of the most 29 senior persons in a bank. Is that the nub of it? 1 2 Right. 3 and joined Guinness Mahon, did your situation change 4 in Haughey Boland. 5 responsibilities come you way? 6 A Once Mr. Traynor had departed Haughey Boland Suddenly did more It certainly changed in terms of percentage. I 7 would have been a junior partner and immediately 8 after that I became a senior partner. 9 202 Q 10 A Who were your fellow partners at that stage? At the time that Des Traynor left, Harry Boland was 11 a senior partner, Des Traynor was senior partner, 12 Frank Donnelly and myself two junior partners. 13 there was an old situation with Mr. Haughey. 14 Mr. Haughey had never resigned from the partnership, 15 he never took benefit from it, but we, Mr. Donnelly 16 and myself were 10 percent partners each, that left 17 80 percent between the other three 18 2/3rd percent each. 19 say what happened at the end of day, at the end of 20 the day when we shuffled through the thing and 21 Mr. Traynor left, there were four twenty-five 22 percents being, Mr. Boland, Mr. Haughey, 23 Mr. Donnelly and myself. 24 participating and his 25% was only memo and he never 25 took anything from it and hadn't for a number of 26 years. 27 203 Q 28 A 29 204 Q But which was 26 and Will I skip all the thing and Mr. Haughey not Because he was involved in other things? Politics, yes. My question of you, did more responsibilities come 45 1 2 I was now effectively a third equal senior partner. 3 You were very busy all the time in those days. I am 4 not sure what extra responsibilities because I would 5 have been shouldering loads of responsibilities 6 anyway. 7 205 Q 8 You have already told us that some of your work was insolvency work? 9 A 10 206 Q That's right. But there wasn't enough of that for it to be full 11 time and some of your work was as a general, if I 12 can use the term, audit partner. 13 inherit some more audit client assignments for 14 instance? 15 A Did you suddenly I think Mr. Traynor was away from the auditing for 16 quite some time before he departed the scene. 17 would I inherit? 18 207 Q 19 20 Did you get his clients. What Were his clients passed to you as the focal point? A I think they would have been passing to me over the 21 years. 22 I can't remember in detail but I would presume that 23 I did. 24 208 Q 25 He was backing off from that. I presume so. So he had gone and you and he had built up considerable friendship over the times? 26 A 27 209 Q Absolutely. Did you see him and or Guinness and Mahon as a 28 potential source of more project work? 29 instance, he had been providing these projects. For He 1 had been servicing these projects and then he had 2 gone to be a managing director. 3 present you with an opportunity to work with 4 Guinness Mahon as a client? 5 A. No. Did that not I would have viewed Guinness Mahon as a bank. 6 They were an investment bank more than commercial 7 bankers. He was there. 8 resource, I suppose, having a friend the managing 9 director of a bank is no harm, particularly when you It would have been a 10 are in the insolvency and rescue operations and 11 things that might happen in that case. 12 that we tapped into a source in any particular way. 13 He was more friendly with me than with anybody else. 14 210 Q. I don't know Let me put a particular question, did you get the 15 opportunity to advise Guinness Mahon on any 16 troubled business assignments where, for instance, 17 things were going wrong and there was a business, 18 borrowing the money and what has subsequently become 19 know as a business review. 20 do that? 21 A. 22 211 Q. Did you get a chance to No, never on the assignment from Guinness Mahon. First, did you get invited by Mr. Traynor or indeed 23 others in Guinness Mahon, to attend any lunches 24 where they would have wanted to have told you what 25 they were doing? 26 A. It was the reverse in the sense in that I would have 27 given Guinness Mahon quite a bit of work, in the 28 sense of introducing clients to them, that they 29 would have provided facilities to and things like 1 that so I would have been well known. 2 certainly invited to a number of golf outings after 3 which there would be a dinner and I remember Maurice 4 O'Kelly, he had joined the bank later on, at one of 5 those dinners saying: "Listen you lot" and there 6 would be load of business men, 7 the expense of feeding you and giving you dinner 8 without getting some feedback from you that we want 9 business from you". I was "we are not going to That sort of thing. There was 10 never any detailed discussion about Guinness Mahon 11 or projects. 12 212 Q Did they ever hold any seminars when they would 13 outlined some of the interesting new products which 14 I have no doubt they would have wanted to have 15 persuaded advisors to encourage clients to avail of? 16 A 17 213 Q I can't recall Haughey Boland being invited to any. Right. So that there wasn't much work coming to 18 Haughey Boland from Guinness Mahon / Mr. Traynor, 19 but there were opportunities coming from Haughey 20 Boland to Guinness Mahon? 21 A 22 214 Q 23 A That's right. Tell me about those? In situations where financing might be off the 24 straight and narrow with some unusual situations, 25 could have introduced clients to Guinness Mahon, 26 probably to Des Traynor to discuss and they were 27 some of them that clicked and they provided 28 substantial funding to them. 29 All right. Then you decided 48 that you would leave I 1 Haughey Boland and I don't need to know anything 2 about why that was but, suddenly you had an 3 opportunity to setup your own business and last time 4 you told us that you had never been or didn't 5 consider yourself as a tax adviser. 6 A 7 216 Q 8 A 9 10 I certainly never did that. And not an auditor either? I was an auditor. business? 217 Q Oh, sorry, when I set up in No, no auditing and no tax. Mostly your business when you set up was in the 11 finance area with banks as raising loans and 12 organising securities and that stuff. 13 whether your business, at any stage because we have 14 been talking about the fairly early stage of all of 15 this up to now, at any stage from the time you set 16 up, did your business fall within the scope of 17 regulation of the Institute of Chartered Accountants 18 in Ireland? 19 A Can I ask you Certainly not particularly in the earlier days or 20 even the later days I am not too sure where I 21 fall within that scope. 22 218 Q 23 A 24 219 Q 25 A would Let me suggest three areas, one might be auditing? No, no auditing. The second might be insolvency? I only completed the insolvency assignments where I 26 had been appointed liquidator or receiver. We 27 discussed it in Haughey Boland and it was easier, I 28 could have resigned and appointed somebody else but 29 it was considered better for me to finish out those 1 assignments. 2 220 Q 3 A 4 221 Q 5 A 6 7 As they were personal appointments. They were personal appointments, yes. The third area might be financial services? I don't know what category that comes within or where that would be. 222 Q Mr. Stakelum, either you know that you had an 8 involvement at some point in your company's life 9 with the Institute, in terms of regulation and 10 meeting the regulatory requirements of the Institute 11 or you didn't? 12 A 13 14 That I had meetings with the Institute? I had no meeting with the Institute. 223 Q Sorry, I think you misheard me. You must know that 15 either you did come within the requirements of the 16 Institute in terms of their regulatory requirements 17 or you didn't. 18 A I have to plead ignorance but I am not sure what 19 their regulatory requirements would have been in 20 connection with financial services. But I can quote 21 you chapter and verse exactly what Business 22 Enterprises Limited did. 23 224 Q 24 A 25 225 Q We will get to that in just a moment? Yes . Can you please tell me what were the trading or 26 business names under which you have operated 27 businesses post Haughey Boland? 28 29 A Business Enterprises Limited was the cornerstone of all that. 1 226 Q 2 A 3 227 Q 4 A 5 Starting day one. 1975? Yes. I might have had the company incorporated a week or two beforehand. 6 228 Q 7 A That's right. 8 229 Q The next one? 9 A And being run down in 1998? I don't know if there is another one that I could 10 add to that but let me explain the peripherals. 11 There was a BEL Secretarial Limited. 12 from the Business Enterprise Limited, the initials. 13 That was incorporated with the purpose and view of 14 having it operate as secretary to companies and it 15 was certainly appointed as secretaries to some 16 companies. 17 never issued an invoice, if I may so, or anything 18 like that. 19 personnel in Business Enterprises Limited. 20 just a name to have there for that. 21 230 Q The BEL coming That has also been struck off but it The work was carried out by the It was Could I clarify whether the name of that company was 22 B. E. L. Secretarial Limited or was it B. E. L. 23 Secretarial Services Limited? 24 A The reason I am hesitating, I thought it was BEL 25 Secretarial Limited and may I go on about that. 26 B. E. L. Secretarial did nothing and was lying there 27 as a dormant company, until I was asked to take over 28 a situation for Mr. Haughey from Deloitte and I used 29 that company then. I believe it was B. E. L. 1 Secretarial Limited. 2 used Services but what I did then, and that was the 3 first time it had a bank account was, in connection 4 with an operation for Mr. Haughey that has been 5 fairly well publicised and then I closed that bank 6 account down in February, 7 I start to work for the Mr. Haughey thing. 8 231 Q 9 A I don't think I would have I don't know in '91 or '92 Did you wind the company up at the same time? No, no. B. E. L. Secretarial, would you believe that 10 I don't know the status of that company at this 11 stage. 12 off at the same time as Business Enterprises 13 Limited, probably in 1999 some time. 14 the bank account for it which was the only bank 15 account it ever had, 18 or 19 months after starting 16 with Mr. Haughey and put in B. E. L. Secretarial, 17 without a 'Limited'. 18 232 Q 19 A 20 233 Q 21 22 No I do, sorry, we asked for it to be struck But I closed Did you register that as a business name? Yes . Were you involved in any other business name trading entities ? A Well I had Clyde Enterprises and before that I had 23 Business Enterprises without the Limited and then 24 subsequently I had Raglan Enterprises and Elgin 25 Enterprises. 26 234 Q 27 28 29 Is an entity by the name of Secretarial Trust Company? A Does that mean anything to you? Oh, yes I would have been the instigator of that. In Haughey Boland & Company days we did exactly 1 that; Haughey Boland being the auditors to a number 2 of clients we decided that it would be more 3 beneficial to have a secretarial company and 4 Secretarial Trust Company Limited was incorporated 5 as a company, way back in my days in Haughey Boland 6 & Company. 7 235 Q 8 So Secretarial Trust Company was a Haughey Boland company? 9 A 10 236 Q 11 A 12 237 Q All right thank you. 13 238 Q You told us that one of the services you provided That's right. And you set your own business up you told me? December 1st '75. 14 under Business Enterprises Limited was that you 15 would act as a non-executive director on behalf of 16 your clients? 17 A 18 19 Depending on their wishes. I would have been a director of approximately 4 0 companies. 239 Q Did you every perceive that acting in that capacity, 20 that is as a non-executive director, presented you 21 with a conflict of interest if you were also 22 promoting that company to a bank in respect of 23 obtaining a loan for the company of which you were 24 the Director? 25 I fail to see even now where the conflict of 26 interest would arise. 27 director of AB Limited, in my capacity one of 28 functions is "look after our banking requirements; 29 go to see A.I.B or Guinness and Mahon or whoever in Clients ask me to become a 1 that capacity, seek for a loan, I fail to see a 2 conflict. 3 240 Q. 4 So the answer is you didn't see any possibility of a conflict? 5 A. 6 241 Q. No. Turning now to the early stages of your business. 7 We know that you continue to work on the insolvency 8 assignments which you had brought with you from 9 Haughey Boland? 10 A. 11 242 Q. 12 13 Yes. How long would it have taken you to have completed those, roughly? A. I think at the time there were about 42 or 43. That 14 has always stuck in my mind and I would believe that 15 forty of them might have been cleared within 12 16 months. 17 243 Q. So that besides that, how did you market your 18 business? 19 clients ? 20 A. One of them took about 20 years. How did you go about attracting new Before I left Haughey Boland and Company there were 21 clients that were making more demands on you than 22 just auditing work. 23 auditing work that they would come, 24 for much more additional involvement than an annual 25 audit or something like that and in going and 26 talking to, because there was a whole array of 27 situations when I gave notice, I gave 12 months 28 notice in Haughey Boland on my departure. 29 reached agreement on a number of issues, one It might have started with they would look We 1 obviously being that I wind up the insolvency work. 2 In addition there were a number of clients that 3 continued to be clients of Haughey Boland and 4 Company in the auditing capacity but now that I 5 would have handled on more general work that I was 6 involved in with them and they would have come to 7 me, without leaving Haughey Boland. 8 any auditing anyway. 9 244 Q I wasn't doing Does that mean that whenever you were leaving 10 Haughey Boland, all the clients that you dealt with 11 were written to say, by the firm, to say that 12 Mr. Stakelum was leaving? 13 A 14 245 Q 15 16 No. I don't think that happened. So it was a case of you knocking on their doors afterwards ? A I think in discussion with clients you get close to 17 clients in talking to them and I would have said 18 that I am proposing to leave here in 6 months time 19 or 12 months time or whatever the case may be. Some 20 of them would have indicated that they wanted to 21 continue to utilise my services. 22 question of discussing with Haughey Boland and 23 Company whether it was in order etc. 24 246 Q Right. Then that was a So that in essence, you may have been 25 consulted on, because this is what you indicated to 26 us last time, on helping them to raise money if they 27 needed money. 28 That would be one of the aspects of things, yes, 29 certainly. 1 247 Q. Were you also asked to help them if for instance if 2 they had a business entity which started to perform 3 badly? 4 A. 5 248 Q. Yes. That would have been the sort of thing that you 6 would have had to deal with in terms of receiveship 7 work? 8 A. 9 249 Q. Yes, rescue work. All right. Let me just change tack for a moment. 10 One of the things you said to us last time was that 11 you didn't advise on tax related issues and I think 12 you gave us the impression that tax was not 13 something with which you had a great deal of 14 knowledge? 15 A. I always had my own tax affairs handled by somebody 16 else. 17 Obviously there is a little knowledge that you gain 18 but tax is so complicated these days that it 19 requires specialist work. 20 tax because I didn't have that expertise. 21 250 Q. 22 I could not hold myself out as having. I never could advise on But we do know you would have studied some tax for your accountancy exams? 23 A. 24 251 Q. Surely That presumably, while you were a qualified senior 25 in Haughey Boland you would have had to have some 26 understanding of tax to do whatever tax related 27 activities were necessary as part of the accounting 28 audit procedure? 29 A. Very little, very little on that because you 1 obviously had to get the backup. 2 would be sufficient knowledge to know where the 3 problems might lie but you would always be advised 4 by the specialist. You would have employed 5 specialists there. I couldn't give people advice on 6 even personal tax. 7 252 Q I suppose there But presumably you would have kept abreast of the 8 major events which were happening in terms of the 9 introduction of legislation by government. 10 know, the budget issues? 11 A 12 253 Q You mean the taxation issues? Yes. I was thinking about the changes which came about in 1974? 13 14 A 15 254 Q Capital gains tax came in then. Well, actually it was really about the transfer of 16 assets abroad legislation. 17 on you? 18 You A No. I don't remember. Did that have an impact I would probably as was 19 usual that immediately after a budget, seminars 20 would be arranged either by the Institute, like 21 breakfasts and lectures after breakfast for hours 22 or whatever or by Kennedy Crowley as it was, because 23 I was an ex-employee there which is now KPMG and 24 later on Deloittes and that and you would go to the 25 breakfast and you would listen to the changes but 26 you didn't absorb unless it was your particular 27 area. 28 In 1975 of course the Government introduced import 29 and taxation legislation? 1 A. 2 256 Q. 3 I am not familiar now with what happened. You wouldn't be familiar with the capital gains tax legislation which was introduced in 1975? 4 A. 5 257 Q. 6 A. 7 258 Q. I thought that was the 6th of April '74. And the wealth tax? There was wealth tax introduced at some stage. Would these have been areas, Mr. Stakelum, 8 if you were dealing with business people and in some 9 cases wealthy individuals, they would have expected 10 11 you to have known about? A. I certainly never -- and nobody would ever be coming 12 to me to give them taxation advice but what I did 13 for clients was certainly if there were areas that 14 needed advice I was able to either bring them or 15 direct them to the place where they could get that 16 advice and I would have to do that I would often go 17 with them to get the particular advice. 18 259 Q. The information you are providing is that you didn't 19 keep abreast as a professional advisor of major 20 changes in statute as they affected tax? 21 A. 22 Certainly not, you are making me feel very incompetent here but I have to admit to that. 23 260 Q. 24 A. 25 261 Q. I am just trying to clarify the position? That's right. Going back then to business, you were helping your 26 clients raise money and you had been dealing with 27 Mr. Traynor and Guinness Mahon before you left 28 Haughey Boland and you had been putting client 29 opportunities his way so that meant that you had at 1 least that relationship to start with? 2 A With him. 3 262 Q With him? 4 A 5 6 My relationship would have been far more, he was a close personal friend as well. 263 Q I understand. At the time did you perceive that 7 Guinness and Mahon had a particular interest in 8 lending money into any sector or sectors? 9 A No, maybe excluding -- they weren't interested in 10 running things like overdrafts. 11 thought probably fairly strong into property because 12 I certainly brought a few property situations there, 13 I think they were thrown out to tell you the truth. 14 264 Q 15 A I would have Property and maybe construction? I am thinking of clients that might have a 16 development project you know for construction, yes 17 maybe construction would be part of that and if the 18 concept was unusual I used to say that I turned down 19 more propositions than bank managers because people 20 would come and be referred to me by somebody else 21 and they would come with crazy schemes that, my God 22 if I brought them to any bank the 23 would come and take me away, so I turned them down. 24 But if I felt the scheme was a runner or if you had 25 an existing client that let's say was insisting on 26 -- and you did your best and put your best foot 27 forward in application to wherever you felt it would 28 be best received. 29 Generally speaking is that where clients were 59 white-coat-men 1 already with a bank that is the bank you dealt with 2 unless the nature of the financing was something 3 unusual. 4 265 Q You did make the point that difficult situations may 5 well have been resolved by an approach to Mr. 6 Traynor. 7 A Yes, in the sense that you could explain and he 8 would have recognised the source of me being honest 9 with some industry put into the effort and what I am 10 telling him to be true. 11 receptive ear of somebody with the authority to 12 recommend strongly if not direct a credit committee 13 to make a loan. 14 2 66 Q I would be having a But of course in putting forward these loan 15 applications your interest was your clients 16 predominantly? 17 A 18 267 Q It couldn't be anybody else, yes of course. If there was and I suppose there would have been a 19 business plan or something of that sort a 20 description at least of the intent of the project to 21 support the application? 22 A 23 268 Q 24 A Yes . Were there business plans as we might know them? Sure, each one would vary. You could be ringing up 25 and saying "Des, I want £10,000 on a short term 26 basis for so and so, would you instruct somebody 27 that that would be Okay", and that might be alright 28 but if you are talking about something very 29 substantial you would probably say, can I see you 1 and you would go down and see him and say listen I 2 have a concept of thinking, would this be a runner 3 with the bank and he might tell you fairly clearly 4 which is also a great advantage that it wouldn't be 5 because sometimes you can go through with bank 6 applications and discussions and find at the end of 7 the day that they were saying no but that were 8 always going to say no. 9 quickly, which would be helpful. So he could say no fairly 10 11 He might then say "well, you know, if you let me 12 have a,b,c,d,e whatever it might be and that might 13 include a business plan or a cash flow projection or 14 a profit projection or a schedule of assets or 15 whatever and then you would prepare that in that way 16 so there would be those things. 17 269 Q. How quickly after you started your own business did 18 Mr. Traynor raise with you the issue of supporting a 19 loan with a deposit elsewhere? 20 A. I really can't answer that, again that's purely a 21 question of looking back. 22 70's or 80's. 23 statement where you are talking -- if we are now 24 talking about back-to-backs as they were known. 25 270 Q. We are probably talking I think I would have said in my Well let me try and help you a little? You left us 26 with the impression last time that the predominant 27 part of your business was -- and incidently the 28 issue of insolvency work didn't crop up last time -­ 29 but the predominant part of your business was in 1 helping your clients raise loans from the banks. 2 You also indicated that quite quickly after you 3 started perhaps one to two years, you then began to 4 place deposits with Mr. Traynor, which deposits were 5 deposited offshore so that -- and I may come back to 6 the question of deposits. 7 that the issue of deposits was then matched in your 8 mind with the issue of those deposits being tabled 9 to support the back-to-back loan? In the interim, was it I want to know 10 how quickly that issue was brought to you by 11 Mr. Traynor? 12 A. I have to say that I don't know that but it could 13 have been and probably was sometime in the 70's, 14 late 70's. 15 as I was only one month there on my own, so '76 is 16 out. 17 as if Mr. Traynor rang me up one day and said "Come 18 down Mr. Stakelum and you know that there are funds 19 abroad that can be used to secure a,b, or c. 20 don't see that happening at all. I mean I kind of discount '75 in so much The way your question comes across is almost I 21 22 I think I would have said in my statement, 23 personally I would be strongly opposed to what they 24 call back-to-back arrangements but you met the needs 25 of clients as best you could. 26 271 Q. Without wanting to seem impolite, we understand this 27 aspect because you explained it to us last time. 28 You see, you already explained to us that mostly 29 work flowed either from Haughey Boland or yourself 1 to Mr. Traynor and GMI and not very much of anything 2 flowed back the other way? 3 I am trying to think at the moment if there was 4 anything that came back the other way. 5 And that you only had a very hazy view of what 6 Mr. Traynor was doing in terms of his overseas 7 banking activities and GMCT and so on. 8 point along the line someone had to explain to you 9 the possibilities of doing a back-to-back situation, 10 At some that is what I am trying to understand. 11 A 12 273 Q Okay. How did all of that happen because it had to come 13 from Mr. Traynor because it couldn't have come from 14 you because you didn't know? 15 A I am trying to think to put this as clearly as I 16 can. 17 situations, of using funds that were somewhere else 18 would have been something that one would have known 19 about, maybe before I left Haughey 20 forget he had arranged a scheme which was 21 effectively an eye view, a back-to-back by lending 22 me £40,000, that loan that you referred to. 23 think that...(INTERJECTION) 24 274 Q 25 A I think the knowledge of back-to-back Boland. Don't Now I That is in 19? That was certainly when I was in Haughey Boland and 26 Company because I thought capital gains came in '74 27 and you said '75 earlier on but it would have been 28 finished at that stage because there was no further 29 advantage. What would have happened is clients 1 certainly approached me and asked me to -- now, I 2 don't want to use the word monitor because 3 Mr. Costello didn't like that word -- to handle 4 their funds, record, reconcile, I am not sure what 5 words to use, which would have been handled through 6 Guinness Mahon. 7 Mahon Caymen Trust. 8 answer to that now because of other developments 9 that have taken place since but I believe that. Let me say, I believed Guinness I believed and I don't know the 10 11 That part of my business was tiny. 12 viewed it almost as a business, it was a convenience 13 or a facility offered to clients that looked for 14 that. 15 part of my business was organising loans. 16 course, I organised loans and for the companies that 17 I was involved in I don't think, you know that that 18 would be a big function but if you then came along 19 and said to me "How many loans did you organise in 20 '84", it may have been two, I don't know because 21 there was a whole pile of other work that was done. I wouldn't have I am even regretting saying that the major Of 22 23 I think what would have happened there is that there 24 would have been funds placed abroad with Mr. Traynor 25 and at some stage some client or other is looking 26 for funds and Mr. Traynor is saying what about the 27 possibility of using the funds as security. 28 am not going to swear to that because I don't know 29 that that's the way it happened. Now, I 1 275 Q 2 3 But it is likely that the idea was promoted by Mr. Traynor, is it not? A It certainly is in the sense that I wouldn't be 4 generally in favour of that. 5 situation of financing. 6 276 Q 7 8 A That is the only one I can think of, we are talking about...(INTERJECTION) 277 Q 11 12 You told us to the best of your knowledge you could only think of one situation, was it Mr. Keane? 9 10 That was a last resort Beside your own one of course which of course preceded your business? A Yes, and wasn't the same at all. That certainly 13 wasn't the same at all. 14 had abroad confidentially, that was a situation that 15 I would have known nothing about until he suggested 16 that to me. 17 278 Q 18 A That wasn't funds that I Right. That is the one I can think of. It may be that out 19 of woodwork some other one would come but I am not 20 sure . 21 279 Q All right. Then let me summarise where we are at 22 and let me say that I do appreciate that this is 23 quite a long time ago and I am not going to try and 24 ask you to remember things absolutely to a month or 25 even to a year because I recognise that that is 26 going to be very difficult unless one has something 27 more concrete to put forward. 28 29 After you started your business in the second half 1 of the '70's you were helping your clients to raise 2 loans and you were helping your clients also to deal 3 with some monies which they had either already 4 abroad or which they wished to deposit offshore and 5 then arising from those two activities you learned 6 from Mr. Traynor about the possibility of supporting 7 a loan in Ireland with a back-to-back deposit in 8 Caymen or somewhere else in the second half of the 9 '70 's? 10 I think that is an accurate summary of the 11 situation. 12 280 Q At our last interview we spent sometime talking 13 about the situation where one of your clients said I 14 have some overseas money and it is somewhere outside 15 of Ireland and the client said to you look, 16 Mr. Stakelum I would like you to monitor, may I use 17 the word manage? 18 A 19 281 Q Yes . As opposed to monitor, might we understand that a bit better? 20 21 A 22 282 Q Yes . To manage this money for me and what we understand 23 from that Mr. Stakelum is that he wanted to make 24 sure he was getting the best rate of interest on his 25 money or if there was other issues of an investment 26 or taxation nature that he was doing the best he 27 could with his capital? 28 29 A No. 1 Absolutely not because that would give a 2 connotation that I would be giving advice about 3 investment and I never did that because you were on 4 a hiding to nothing. 5 stockbroker or anything like that. 6 to a client, you should do this or you should do 7 that or you should do the other. 8 me the instructions. 9 funds were purely on deposit. 10 I wasn't a qualified So I never said They totally gave They understood that their I would have advised them about rates available of deposit, that was it. 11 12 In some cases some clients asked me to buy shares 13 for them, public company shares, which I did, if 14 they so instructed. 15 would buy the shares and in many cases, no, now that 16 is not true, in one particular case I was abhorred 17 about share purchases. 18 284 Q I instructed whoever it was who Sorry, we are digressing a little. Let me just keep 19 you to the point. 20 and he said look I would like you to manage this for 21 me by way of getting me a better rate of interest? 22 A 23 24 Somebody had some money abroad I doubt if the conversation was like that, but carry on. 285 Q 25 That was the nub of it, would it not be? You looked around...(INTERJECTION) 26 A 27 286 Q Well, I think there were other factors but go on. You looked around and you found that there may have 28 been a number of options, one of which might have 29 been GMCT, so, having established that you would put 1 these options in front of your client and say which 2 of them are you going to select or would you have 3 said that there makes more sense? 4 A 5 287 Q 6 A No. How would you have done it? I will tell you how I believe I would have do it, I 7 would have said -- there are other reasons for 8 looking after monies and monitoring or managing as 9 the case may be, from just the interest rate, but 10 letting that one go for a minute, what I would have 11 said I think is that Guinness and Mahon have an 12 offshore operation. 13 can handle the funds through and it would be up to 14 them to decide whether or not they transferred to 15 there. 16 presenting them with options. 17 288 Q That is the only place that I I wasn't aware of other options or So you explained to people that Guinness and Mahon 18 had an offshore option. 19 with some sort of an information sheet about 20 Guinness and Mahon's offshore option? 21 A 22 289 Q 23 A Did you then present them Absolutely not. No? In all the funds that I got over all the years from 24 all the clients never once did I give them a piece 25 of paper acknowledging that I got the funds. 26 the years, in all the clients passing back their 27 funds, I never asked for a piece of paper to 28 acknowledge that they received them back. 29 a situation where people trusted you and that was In all This was 1 2 290 Q 3 4 recommendation? A 5 6 So, effectively they trusted you to make a About what? They would have been aware that their funds were going on deposit in a bank. 291 Q Yes and that as far as you were concerned you 7 believed that was first of all a solid institution 8 and that it was presenting the best interest 9 opportunity for them? You were recommending it, 10 because they had nothing else to go on except your 11 recommendation? 12 A They were getting the value of my service in the 13 situation and that was being handled through 14 Guinness and Mahon who were a bank. 15 occasional fight with Guinness and Mahon on their 16 interest rates and sometimes they weren't as good as 17 other people but that was the package, it was 18 Guinness and Mahon they were getting and that was a 19 bank. 20 292 Q 21 A 22 293 Q 23 A I had the And you had...(INTERJECTION) And their funds were just on deposit. And you recommended it? The truth is, if you really want the truth, I 24 wouldn't have recommended any of it, because it was 25 a nothing for me, it has proven a hell of problem at 26 this stage in my life having got rid of it and I 27 didn't make any money out of it. 28 along and approve this or recommend it. 29 a facility that they looked for. So, I didn't come I provided 1 294 Q 2 Did you every recommend any of your clients to put money into merchant banking? 3 A 4 295 Q No. All right, thank you. Last time we discussed this 5 matter you explained that you thought the issue of 6 dealing with clients deposit, perhaps arose as an 7 issue made from some clients who had money abroad 8 and they wanted to organise it differently and you 9 would have -- because the money was abroad and you 10 knew that Mr. Traynor was dealing with offshore 11 interests, you would have gone along and talked to 12 him about that situation and having thought about it 13 he would have recommended a course of action. 14 thought about it and you felt it was appropriate and 15 you would have gone back and suggested that to your 16 client. 17 recommendation then Mr. Traynor would have provided 18 routing. 19 instructions, 20 was in your clients control into Mr. Traynor and in 21 GMCT's control, is that right? 22 A 23 296 Q If your client was inclined to take your I think was the word you used, for how the money got from wherever it That's right. Routing instructions. I want to explore those 24 routing instructions with you. 25 Mr. Traynor with your clients name? 26 A 27 Did you provide I can't remember specific instances but by and large he wouldn't have known the names. 28 297 Q 29 A You Yes, that is what you said. 1 298 Q. 2 May I assume that it was unlikely or less likely that he didn't know your clients name? 3 A. 4 299 Q. 5 A. 6 300 Q. Less likely. But he might have? He might have. He would have said to you, would you ask your client 7 to lodge his money to a particular bank, account 8 reference this, isn't that right? 9 A. 10 301 Q. That's right. So, that is all your client knew, that he had sent 11 money to a particular bank of Mr. Traynor's and that 12 thereafter you didn't worry about it and your client 13 didn't worry about it because Mr. Traynor looked 14 after it? 15 A. 16 302 Q. 17 A. 18 19 So, you didn't know where the money had gone? No, I mean, I would have known with the instructions, the first receiving back that we got. 303 Q. But that probably wouldn't have been Guinness and Mahon Caymen Trust Limited, would it? 20 21 A. 22 304 Q. 23 24 Yes. Probably not. You said last time that there was usually an intermediate? A. I think that's the way they operate, I guess if I 25 rang up somebody or somebody asked me to transfer 26 £10,000 from the bank of Madrid in Bilbao or New 27 York, I would have to get moving instructions and it 28 would probably go through other banks along the way, 29 because they were receiving banks we had. 1 305 Q. Let's suppose that this money started off in your 2 clients control in dollars. 3 dollars to GMCT and if it was felt that it was 4 desirable to retain it in dollars then there was 5 presumably opened a dollar account in GMCT, yes? 6 A. 7 It moved through in Well, yes I presume if they took dollars and kept dollars they had a dollar account, yes. 8 306 Q. 9 A. 10 307 Q. 11 That's all I am asking you? Yes. What sort of record did you keep of that transaction? 12 A. 13 308 Q. 14 A. 15 309 Q. 16 A. 17 310 Q. 18 Very same as any other. So, you kept a dollar account? Dollar and sterling. Pardon? Dollar and sterling. Yes but in this case we are just dealing with dollars, you kept a dollar account? 19 A. 20 311 Q. Yes. Let me suppose another client came along to you and 21 said I want to transfer Deutschmark, the same 22 process and you kept a Deutschmark account? 23 A. 24 312 Q. 25 A. Yes, except I don't think I every had one. And somebody else a French Franc account? I think I only had two accounts, dollars and 26 sterling but it is possibly at some stage I may well 27 have had, I don't know. 28 29 313 Q. On that point you have told us that you had no idea of the names of those accounts, sorry excuse me, the 1 reference numbers of those accounts maintained by 2 Mr. Traynor? 3 No, I now realise I don't even know where the money 4 was but I mean...(INTERJECTION) 5 314 Q 6 A That is the second point? I think I would have had a reference or some code 7 reference but I can't remember. 8 wouldn't have been what was shown to me there. 9 315 Q 10 11 It certainly Would you try and think back please and tell me what sort of code reference you might have had? A I think you asked me this the last day and I figured 12 it was probably an initial and a number but I just 13 don't know. 14 316 Q Mr. Traynor? 15 16 Do you think you had some code reference for A I guess so, I think so, yes. You see you made 17 reference to the fact of how do you identify when 18 you ring up to get your monthly balances and the 19 likelihood -- first of all they would have known and 20 what account it was but I might have said something 21 like I wanted a balance on B7 or -- I don't remember 22 what that code was. 23 317 Q I am prepared to accept that you may, you believe, 24 have been given some sort of reference code from 25 Mr. Traynor? 26 A 27 318 Q Yes . We have been speaking up to now about money, your 28 clients money, which was already overseas and it 29 moved from some overseas bank into the control of 1 Mr. Traynor and you believe that probably meant that 2 it was with GMCT? 3 A. 4 319 Q. 5 A. 6 320 Q. 7 A. 8 321 Q. 9 Pardon? I did believe that. You did believe that? I am not sure I believe it now. What about clients who had money available in Ireland which they wished to put into a good 10 11 I did believe. investment ? A. If they wish to transfer Irish pounds abroad, I 12 think at a stage, at an early stage, there was no 13 problems about that because I think the pound and 14 the sterling were one of the same and that there was 15 no restriction on sterling so it could just be moved 16 abroad offshore. 17 problem and the only way that that could be done 18 would be to supplant and replace funds. 19 wanted to take funds back from abroad and somebody 20 wanted to put them out, you could do it by journal 21 entry. 22 322 Q. At a later stage that was a If somebody Before we get to that, if someone had a sum of money 23 which they wished to put on deposit as their advisor 24 you had a number of options open to you, you could 25 have advised them to deposit it in Ireland or you 26 could have advised them to deposit it offshore. 27 you were talking about advising them to go offshore 28 it could have gone offshore with a number of other 29 organisations who provide offshore facilities or it If 1 could have gone through GMCT, how did you decide 2 when advising your clients which was the most 3 appropriate? 4 A. They weren't options that I perceived as being 5 available at that time. 6 situation through Guinness and Mahon where there 7 were offshore funds, unless it was an initial 8 lodgement for a client he might already be in that 9 Hotchpotch account, so to speak. 10 323 Q. 11 12 Anyway what I had was a I am talking about a client that hadn't any previous involvement with Guinness and Mahon? A. I don't know what the circumstances was but in the 13 situation, it wasn't a question of sitting down and 14 putting various options to clients about whether he 15 would invest here or away. 16 instruction from a client that he wished his funds 17 to be placed offshore. It would be taking 18 19 So, I didn't had an option of saying well you really 20 should go down the road and put that on the Trustees 21 Savings Bank or something. 22 instruction and he would be aware that I was 23 operating through Guinness and Mahon. 24 offering or indeed aware of other options that might 25 be available to me if he wanted to put funds 26 offshore. 27 324 Q. 29 A. I wouldn't be Your client would be aware that you were operating through Guinness and Mahon? 28 I would be taking an That's right. 1 325 Q In effect if you had a client who wanted to put 2 money offshore you advise them to put it through 3 Guinness and Mahon? 4 A 5 I would do it. 6 326 Q 7 A 8 327 Q 9 A 12 328 Q 13 A 14 329 Q 15 A 16 330 Q 17 A 18 331 Q 19 A 20 332 Q A Probably in cash. As in notes? As in notes, yes. Large sums of money in notes? Well, there might have been tens of thousands. All right, large sums of money in notes? Yes . What happened then? They would have been lodged to, let's say Clyde Did you open the Clyde Enterprises Account fairly No, but I had one previous to that, Business Enterprises. 333 Q 26 Right. So, the money that was put into Clyde Enterprises ? A 28 29 Your client early on in your business? 24 27 You got the sum of money, would you explain to me Enterprises. 22 25 Yes . produced the money in what form? 11 23 That's what we are talking about isn't it? the process please from that point on. 10 21 Yes, if he was asking me to handle it that's the way Or Business Enterprises maybe, yes. Let's assume the sum of money was £10,000. 334 Q Yes? 1 It would be lodged in there and I could only say, 2 and this is post the time when it was no longer 3 possible to transfer funds abroad. 4 335 Q 5 A Yes . I would be saying to the client, if and when I have 6 an opportunity I will transfer that abroad and when 7 an opportunity presented itself where somebody might 8 ask for £6,000 in cash I would draw the £6,000 in 9 cash. 10 336 Q 11 A Out the £10,000 that you had received? Yes, and then do a journal entry for the abroad sums 12 crediting one client with the £6,000 and debiting 13 the -- subject to whatever the exchange rate was 14 etcetera. 15 337 Q 16 17 You had to tell Mr. Traynor? A 18 19 No, I had not. I most certainly had not. Why would I tell him. 338 Q Because you had just taken a new deposit which was allegedly going t o ...(INTERJECTION) 20 21 But you had to do a bit more than that didn't you? A Into my Hotchpotch Account. He wouldn't have know 22 about it, I most certainly did not tell him and 23 that's why he couldn't know. 24 wouldn't have changed in balance, how would it 25 change. 26 So, you explained to your client when he was 27 presenting you his £10,000 that you were going to 28 invest this on his behalf in an offshore account 29 with Guinness and Mahon. The Hotchpotch Account Did that not mean that you 1 had to tell Mr. Traynor at some point? 2 A 3 340 Q 4 A 5 341 Q 6 A 8 342 Q 9 Absolutely not. So all Mr. Traynor knew was that every so often you That wouldn't involve a tranche of money. But we do know that every so often you withdrew some money. 10 A 11 343 Q 12 Yes, I did. Every so often you requested some money from Mr. Traynor? A 14 15 No? sent him a tranche of money? 7 13 No, it did not. If the clients requests for funds were -- if I didn't have funds to meet what their requests were. 344 Q Yes. I am intrigued then because somewhere along 16 the line the accountancy doesn't work. 17 Mr. Stakelum, if you never transferred money to 18 Mr. Traynor did Clyde Enterprises have money with 19 Mr. Traynor in the first instance. 20 A Somebody has got lost in this thing. How Clyde 21 Enterprises never had money with Mr. Traynor, never 22 had. 23 345 Q 24 A 25 26 Never had? Never had and I am not sure where you are losing the plot here Mr. Rowan. 346 Q Try and help me because I understood -- let me put a 27 big idea to you -- I understood that you encouraged 28 your clients to put money into GMCT to avail of 29 whatever the advantages of doing that was? 1 A I have to question your "encourage", I did not but I 2 was asked to facilitate him by doing that. 3 Encourage them is that wrong word. 4 347 Q 5 6 Would you explain to me then please how that was done? A Yes, I will. Let's take the simple situation, let's 7 assume that there is an account in existence in 8 GMCT . 9 348 Q 10 A 11 349 Q 12 A 13 14 I find that hard to explain. I am finding it even harder to understand? There is an account in existence, the Hotchpotch account. 350 Q 15 16 What do you mean by that? How did it start what was the first transaction that started it? A Okay, I don't know what the first transaction was 17 but let me speculate may I, it was possible that a 18 client came to me and said, 19 abroad I would like you to monitor them", or in your 20 terminology, manage them, or reconcile or whatever, 21 control them or whatever the word is and "I am not 22 comfortable with wherever the funds are for what 23 ever reason" and there may be many reasons why he 24 might not be and I would maybe have said at that 25 stage, 26 operation and I can arrange to have the funds 27 transferred to Guinness and Mahon and I would look 28 after them for you from that point on. 29 "Jack I have funds "Well, Guinness and Mahon have an offshore 1 We talk about what the interest is, the only thing 2 that I would have told them was that the money goes 3 on a bank and it goes on deposit but they probably 4 were aware that it was Guinness and Mahon that I was 5 talking about. 6 was Guinness and Mahon Caymen Trust as I suspected 7 or College Trustees or whatever which maybe it was 8 that I didn't know until recently. They would not be aware whether it 9 10 I would say I'll have to find out how I get a 11 routing for this. 12 initially have talked to Mr. Traynor and said; "I 13 have a client with foreign funds, he wants them 14 transferred into a situation where I would look 15 after them and what are you going to do for me?", 16 and he would say "Look you transfer them here and 17 here is the routing situation. 18 give instructions to Royal Bank of Scotland in 19 Jersey or wherever. 20 where they are under his control to transfer X 21 pounds maybe to Guinness and Mahon London, Account 22 Caymen, reference number XYZ, I don't know what 23 those instructions would have been. 24 back to the client and I would say "Here there is 25 your instructions now, you give instructions to 26 your bank whoever the authorised signatory is on 27 them and that's where the funds have to be moved to 28 and when they are moved tell me and I will tell 29 Guinness Mahon and then Guinness Mahon presumably I would probably, undoubtedly The client has to He has to give instructions I would come 1 did whatever they do with those bank funds. 2 suit them to use half them there in London and the 3 other half in Hong Kong but they would finish up 4 giving credit, presumably in GMCT and that's number 5 one point of a Hotchpotch Account because that would 6 have happened on a number of occasions and they all 7 finish up in the same account. 8 351 Q. 9 10 It may So, the Hotchpotch started with funds that were already abroad? A. Yes, so, I believe, incidently it is possible that 11 somebody came in at a stage, and I didn't know this, 12 when exchange control regulations started that you 13 could transfer funds from Irish currency into 14 sterling and there was no restriction on sterling. 15 I don't know exactly how that started it is aeons 16 ago and that. 17 352 Q. If in fact the Hotchpotch Account started with 18 overseas money, let's suppose that the Hotchpotch 19 Account started with five hundred thousand pounds, 20 then providing you never needed to withdraw more 21 than five hundred thousand pounds the system worked 22 because each time you got a new deposit in Ireland 23 you put that into Clyde Enterprises and while you 24 had money in Clyde Enterprises you could repay 25 people who wanted to withdraw, yes? 26 A. 27 353 Q. Absolutely. If in fact the people who started the Hotchpotch 28 Account, the five hundred thousand, if they wanted 29 to withdraw that amount then you had a problem 1 2 A. I don't know where I have a problem, where have I a 3 problem there? 4 clients give you money they had it and they wanted 5 to withdraw they got it back. 6 354 Q. 7 A. 8 355 Q. 9 What you are talking about if Yes? No problem. Yes, but I think you might accept that if you exclude any new deposits that once the five hundred 10 thousand pounds that started it all had been 11 withdrawn here in Ireland, then the Hotchpotch 12 account would have been zero? 13 A. 14 356 Q. 15 A. 16 357 Q. 17 A. 18 19 That's right. If it got to zero? Yes. New deposits in Ireland? That's right I wouldn't be able to make further deposits, 358 Q. I agree with you, yes. So effectively while that didn't happen, while the 20 amount that was originally used to create the 21 Hotchpotch Account, in effect when people gave you a 22 new deposit you lodged it in the AIB, in Clyde 23 Enterprises, if somebody wanted a withdrawal you 24 gave hem a withdrawal and as far as they were 25 concerned they had money on deposit with Guinness 26 and Mahon offshore? 27 A. 28 359 Q. 29 Yes, I would say that is a reasonable conclusion. But if fact they had money on deposit with Clyde Enterprises ? 1 No, no, no, no. 2 account, Clyde Enterprises merely had a current 3 account and let me tell you some of the 4 restrictions? 5 say the £10,000 and they wanted it placed abroad I 6 would have to say to them, this is assuming that 7 there are exchange control restrictions in at that 8 stage, I would have to say to them, 9 opportunity arises I 10 Clyde Enterprises had no deposit When people came with me, with just "if and when the will place the funds abroad for you". 11 360 Q 12 A 13 361 Q 14 A That might have been a month later? It might have been a month later. What did they do for the interest? They were quite happy to understand and I explained 15 to them in detail, until such time as the money went 16 on deposit abroad they earned no interest. 17 362 Q 18 A Did you explain this to them? I did and furthermore you would have the situation 19 where it wouldn't be black and white that if they 20 gave £10,000 they might get £6,000 abroad in a week 21 and it might take them another month to get the 22 other £4,000 or it might be £3,000 would get in 23 another fortnight and the other £1,000 might be 24 another month and that would be explained to them 25 and understood. 26 27 I have and still enjoy a great trust relationship 28 with my clients and they understood it and I made 29 nothing out of that because it was on current 1 2 363 Q 3 A 4 364 Q 5 A Why? Why. Why not put it on deposit? Very simple. If I put that on deposit I would have 6 to explain where it came from and that wouldn't be 7 part of the confidentiality of the funds. 8 365 Q 9 10 Because you had it in a current account you wouldn't have to explain it? A I wouldn't, who would I have to explain it to? If 11 it was on a deposit account it would earn interest 12 and attract attention. 13 3 66 Q 14 A 15 367 Q 16 A Attract attention? Yes . Just explain that to me? Well the Revenue would be aware of it for a start 17 off, of the funds, that there would have been 18 deposit interest earned and there would be returns 19 of that made by the banks at those stages. 20 368 Q 21 22 that into your current account? A 23 24 Clyde Enterprises current account, yes, which was mine, I owned Clyde. 369 Q 25 26 So, once you took a new deposit of £2,000, you put Yes I understand. You didn't need to tell Mr. Traynor he didn't need to know that? A Not alone did he not need but he would never have 27 been told and secondly he wouldn't have the remotest 28 interest, what interest would it be to him? 29 370 Q Forgive me, I thought that a banker needed to know 1 2 A. 3 371 Q. Not necessarily the depositors. All right. Leave those aside. Earlier on I give 4 you some instances about money coming from a dollar 5 account and being held in a dollar account and some 6 more money coming in a different currency and being 7 held in that currency, how can all of that have been 8 recorded in a single Hotchpotch account? 9 A. It couldn't. There could have been two or three 10 Hotchpotch accounts. 11 dollar and sterling were segregated. 12 think 13 sterling or sterling to dollar, that would have been 14 their decision so you would be switching from one 15 Hotchpotch to another. 16 372 Q. 17 I can only remember two, At stages I clients asked me to switch from dollar to Taking Mr. Keane for instance, Mr. Keane had a back-to-back? 18 A. 19 373 Q. Yes. The way Guinness and Mahon had the back-to-back set 20 up was that the offshore deposit had to be known and 21 matched against the lending that Guinness and Mahon 22 provided, so there had to be a linkage between the 23 two? 24 A. 25 374 Q. Yes. The deposit was hypoticated, i.e., it couldn't go 26 anywhere while the loan remained outstanding, how 27 was Mr. Keane's deposit dealt with in the light of 28 what you have been explaining and in the light of 29 what I just told you? 1 I don't know specifically but if I can tell you what 2 I believe would have happened, they would probably 3 have moved the appropriate amount out of the 4 Hotchpotch Account to a specially identified 5 account, probably. 6 375 Q 7 A How would that have been recorded in your records? No, need for it or I may have done the same thing, I may have taken...(INTERJECTION) 8 9 376 Q 10 A Which is it Mr. Stakelum? I suppose I probably did the same thing, but the 11 same thing in my book would be a very simple thing 12 where I have a schedule of deposits and I merely 13 split Mr. Keane's deposit, let's assume that he had 14 £100,000 and they wanted to back £80,000, I would 15 probably have described Mr. Keane as £20,000 free 16 funds and £80,000, if you want to use the word 17 hypoticated. 18 377 Q How would you known about that? Somebody would have 19 had to have explained that for you from the Guinness 20 and Mahon side of things? 21 A 22 378 Q Sure I would have arranged his loan. It would be all explained to you that while the loan 23 was outstanding he couldn't touch that element of 24 his deposit. 25 A 26 379 Q Yes, that doesn't take a lot of explaining. Forgive me, I don't know how it worked, I am trying 27 to get you to explain it to me, so now I understand 28 Mr. Stakelum that you would have known about the 29 back-to-back situation because on the one hand you 1 knew about Mr. Keane's deposit and on the other hand 2 you knew because you had negotiated his loan? 3 That's right. 4 ever in the premises of Guinness and Mahon in his 5 life, he may have been. 6 380 Q 7 I have my doubts if Mr. Keane was For placing all this business with Guinness and Mahon, did you earn remuneration? 8 A 9 381 Q 10 A From Guinness and Mahon. Yes ? Quite the reverse. No, I did not and eventually I 11 left Guinness and Mahon because their charges were 12 too high. 13 382 Q You didn't earn any remuneration from Guinness Mahon 14 or Guinness Mahon Caymen Trust or any other related 15 entity controlled or directed by Mr. Traynor? 16 A 17 383 Q No. Did your remuneration then come from your clients? 18 I don't need to know the detail, I just need the 19 answer to that question? 20 A The answer to that -- any remuneration that was 21 there came from the clients but it varied greatly 22 and it barely covered costs and eventually wasn't 23 covering costs so that is why I moved out of 24 Guinness and Mahon. 25 384 Q 26 27 So for providing all of these management services you traded at a very modest if at all surplus? A Well, for all of these management services, Mr. 28 Rowan, it was a relatively simple operation, there 29 were only deposits earning interest and a 1 reconciliation once a month, that's number one. 2 Number two, Guinness Mahon made the charges not me. 3 They had charges for this that and the other, there 4 is nobody like banks to be able to make charges, 5 that's number two. 6 used foreign deposits varied and there were 7 different kinds of categories. 8 friends or relations that weren't charged, some who 9 I was acting for in Business Enterprises Limited 10 anyway and charging fees to Business Enterprises 11 Limited where there was no additional charge and 12 others that were in neither of those categories that 13 I would have charged to cover costs. Number three, my clients that Some very close 14 15 One of the things that hasn't been understood and I 16 recognise that your inquiry is necessary on these 17 things, this was a tiny percentage of what I was 18 involved in. 19 trying to earn money for Business Enterprises and 20 this was nothing. 21 eventually moved out of Guinness Mahon because they 22 made some extra special charges and eventually gave 23 all the money back to the clients because it was no 24 good to me. I was busy doing things all the time It was a nothing so much that I 25 26 Therefore when you talk about whether I had an 27 account personally, I hadn't an account personally 28 in Guinness Mahon. I could have used the facility 29 to draw some dollars periodically for this but it 1 2 3 So, it wasn't managing all these funds, it wasn't 4 investments, it was your money that they wanted to 5 put on deposit and the only other service to that 6 where they asked me "Can you buy shares with those 7 funds if you want to?", and they gave the 8 instructions "Buy AIB shares" or anything you want. 9 385 Q 10 A 11 386 Q Thank you very much? That was my involvement. Okay. Ms. Mackey wants to pick up a matter with you 12 I hope will not be very long, I am conscious that it 13 is ten past one and we should be trying to take a 14 break. 15 A 16 387 Q 17 A 18 Are we coming back after lunch. I am hoping that we can avoid doing that. My solicitor has to leave at half one. MS. MACKEY: We should finish in ten 19 minutes. Basically Mr. 20 Stakelum, because matters had gone on so long this 21 morning, we haven't got around to the question of 22 your clients at all and that is something that will 23 take some time. 24 do that today, unless we come back after lunch and 25 since you weren't prepared for that I think the 26 better option would be to ask you to come back 27 another day to do that. 28 what will happen on the next day if I could suggest 29 something to you now. It seems to me that we if we can't We will be able to shorten 1 A 2 388 Q Sure . First of all you give us a list of clients on the 3 last day that you were here, that doesn't appear to 4 be a full list? 5 A It is as full as I can come up with at the moment. I would have -- like all the records were destroyed. 6 7 389 Q 8 A 9 Yes? I am open to the fact that there may be other ones but where I had to work from, if I may, is work from 10 the fact where I disengage with clients in '97/'98 11 and some earlier than that, because all the records 12 were destroyed. 13 and worked back and said who was there in the days 14 of the Guinness and Mahon runs and who were there 15 subsequently in AIB. 16 390 Q 17 18 Look at closing transcripts of them Basically are you saying that this is all that you can remember but there may well be others? A Well, I mean you can produce documents to me that I 19 can't remember anything about and maybe you can do 20 that, that is possible but there is no client or 21 name deliberately left off that list. 22 391 Q That is what I am asking you but is it possible that 23 if we were to put other names to you, you might 24 recollect them? 25 A 26 392 Q Absolutely. Well what I would like to ask you to do if you 27 would, in respect of all the names that you have 28 given us? 29 1 If before our next meeting you could provide us in 2 written form with the particular services that that 3 client had in Ansbacher. 4 the client had a deposit, whether they had a 5 back-to-back loan and any detail that you can give 6 us of that person, except amounts, we don't require 7 amounts but any detail of the deposit, when it was 8 opened and when it was closed, insofar as you can? 9 A In other words, whether Can I just say, Ms. Mackey, here I have no way of 10 knowing that and all I could do is go back to the 11 client in question and say when. 12 that route without a lot of success and that's all I 13 could do in connection with that. 14 about the date that is was open. 15 service that is given is simple, I could look at the 16 clients and say, no back-to-back because I had very 17 few of them. 18 394 Q 19 A I have been down You are talking You see the Could you do that? I will certainly do that and the dates of when they 20 were opened. 21 the clients on that list were opened at or before 22 the mid 80's . 23 395 Q 24 A 25 26 All I can say is that I believe all of Yes ? Do you know, because I think after that I was moving to get myself out of Guinness and Mahon. 396 Q For example could you tell us in respect of each of 27 them whether they were clients who already had 28 monies abroad or clients who came to you with Irish 29 money wishing to put it abroad. 1 Some are in both categories, do you know what I 2 mean? 3 Could you make your best estimate, you can say that 4 you are uncertain certainly but it would help us to 5 have whatever information basically you can give us 6 about each of those clients because otherwise I will 7 have to go through them one by one and ask you 8 detailed questions? 9 A 10 11 Let me tell you that I might say things that the client would say the reverse. 398 Q That may well be and if that is the case we will 12 have to look at what the client says and what you 13 say and see which one...(INTERJECTION) 14 A particular client about something else. 15 16 399 Q 17 A 18 19 I know that there is two different memories from one Absolutely. Some clients believe that they gave me money before I had set up in business and they didn't. 400 Q I see, yes. Also there are a number of other names 20 if I could just mention them to you now and if you 21 might jot them down and indicate to us whether these 22 people were or were not your clients and what other 23 information you have about them. 24 A 25 401 Q Yes . I will just give you the names now. Anthony and 26 Brian Rhatigan, John Byrne, Mrs. D. Leydon who I 27 believe was your secretary at some stage? 28 A 29 402 Q No. Is that incorrect? 1 A 2 3 No, that is incorrect. She is a widow woman from a Mr. Leydon that lives...(INTERJECTION) 403 Q 4 Is she related to the Michael Leydon that...(INTERJECTION) 5 A 6 404 Q 7 A 8 She is his wife. I see. Sorry, Anthony and Brian Rhatigan you gave me somebody else? 9 405 Q 10 A 11 40 6 Q John Byrne. Yes . Well, Mrs. D. Laydon anyway, you can just say what 12 you know about her. 13 Moynihan, Niall Moriarty, Harold Lindsey, Chris 14 Gooson, Joseph Sealy who was your colleague? 15 A 16 407 Q Brendan Deignan, Michael He was my colleague. Frank Glennon, Douglas Armstrong and then two 17 company names, if you could explain (A) whether they 18 were your clients and (B) if so who the beneficial 19 owners of company was, Diagem International Ltd., 20 and Warehousing and Distribution Ltd. 21 mentioned Connor Stakelum, a cousin of yours, so if 22 you would put him on the list as well. 23 mind then and this would also expedite matters, if 24 you could also list for us separately all the 25 companies of which you were a director? 26 do your best with that? 27 A 28 29 Would you If you can I have lists of former and current but how complete they would be. 408 Q Also you As best you can do? 1 2 Stakelum, will have, or 3 companies of which you were a director will have 4 made returns to the registry of companies and at 5 lest for part of time you would have been expected 6 to have indicated what other directorships you had? 7 A. I have a couple of those lists but I am not sure 8 what goes back. 9 MS. MACKEY: 10 Whatever you got back Mr. Stakelum, if you wouldn't 11 mind. 12 M R . ROWAN: Would it be good to make another date today? I don't think so. Mr. Stakelum I think what I 13 14 would like to suggest to you is that we would be 15 obliged if you could get this information to us at 16 your earliest convenience and once we have received 17 that then we will be in contact with you with a view 18 to reinstating this interview because effectively 19 this interview is being adjourned today and it will 20 be reinstated at a time which will have a 21 relationship to whenever you provide us with the 22 information. 23 A. 24 25 Yes, it wouldn't take long anyway. MS. MACKEY: A. So is that okay? I don't think that will take very long, maybe Monday 26 or Tuesday I would have that information back to 27 you. 28 M R . ROWAN: 29 That would be fine, thank you very much. This 1 interview is being adjourned now. 2 coining in Mr. Stakelum. 3 A. Thank you. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW WAS THEN ADJOURNED Thank you for \Vhr-d Cummzu South?s 3 kerix 0\ 13' Appendix XIII (a) File memo dated 22 November 1990 made by Mr Liam Donlon together with backing documentation (b) Documentation relating to 1989 Back-to-back loan (c) Two lists dated 22 July 1993 and 3 January 1996 showing the range of back-toback loans involving IIB (d) Extract of IIB draft submission (e) IIB internal memo of 12 June 1992 (f) IIB submission on the redesignation of Ru Leonard and SM Morris accounts “in trust” (g) Central Bank letter of 8 September 1997 and IIB’s reply dated 11 September 1997 (h) IIB analysis which puts the Ansbacher/Hamilton Ross accounts into context Appendix INTERNAL MEMO ) • - PMcE and the writer net with Des Traynor at his request. Inter alia Des Traynor is..chairman of CRH but this meeting was in connection with his involvement in various trust companies, mainly Ansbacher Cayman Islands which is now 75% owned by Richard Fenhells. • Des outlined to us his interest in establishing a relationship with IIB for a number of reasons : (a) the main purpose would be to have a bank which would hold on a continuous basis significant amounts of funds, mainly Sterling but also other currencies as specified in a schedule given to * us. The accounts which would need to exist would have various requirements - again these are set out in the schedule, . including an indication of the likely number of transactions across the account. They would expect to receive reasonable market rates and would get quotes from* time to time but not with a view to getting the best possible rate in the market as ) long as they were getting a fair rate. He would like us to respond as to what elements of his requirements we could meet. He also has a need for back to back loans from time to time. As a sample of these he gave us the accounts of a company called Lydon and a copy of a Facility Letter they had been offered from Ansbacher. He told us that the details of these various activities were .dealt with by Padraig Collery , ex Guinness 6 Mahon who now works part­ time for Des Traynor at his offices and that the best way to proceed would be to discuss details with him after we had come to some preliminary conclusions as to what we would like to do. .He would like us to revert to himself directly in relation to the back1 to back loans -which we promised to do early next week. He are to consider his needs in how we can respond to then and arrange a detailed meeting with Padraig collery and phone Des Traynor about the back to back loans. L D ^ ? '■'.J rs ) ) {j U t h a iU g . *76^0^' S t e r l i n g M a i n Accounts £ Type - C a l l S t e r l i n g £. .• Average Balance - Stg.£1Om. Rate - 1 m o n t h r a t e f i x e d on t h e f i r s t w o r k i n g d a y o f e a c h m o n t h .i Transactions - 15 0 p e r m o n t h . Transaction Type - S t e r l i n g ch eques lodged. S t e r l i n g D r a f t s i s s ue d. "Foreign Cu rrency lodged. F o r e i g n Currency and T r a v e l l e r s Cheques issued. IRE D r a f t s issued. S t e rling £ cash required. S t e r l i n g £ c ash lodged. S t e r l i n g t r a n s f e r s i n / o u t v i a I n t e r Bank. Foreign Currency transfers in/out via ____________ Inter Bank. P u r c h a s e of S h a r e s f o r O v e r s e a s N o m i n e e s , S a l e of S h a r e s . ? C o l l e c t i o n of D i v i d e n d s . P a r t i n t e r e s t a p p l i e d as a d v i s e d . B a l a n c e of i n t e r e s t a p p l i e d q u a r t e r l y . Statements weekly. Sundry Account Type C a l l S t e r l i n g £. Average Balance Stg.£60K. Rate Call. Transactions 20 p e r m o n t h . Transaction Type Transfers in/out Main Account. T r a n s f e r s in/out via Inter Bank. IRE p a y m e n t s b y d r a f t s t o A M E X , D H L , Statements etc, Weekly. Fixed Accounts Type F i x e d S t e r l i n g £. Average Balance Stg.£7m. Rate Q u o t e s f o r 1, 3, 6 a n d 12 m o n t h s . Transactions 30 A c c o u n t s r o l l i n g o v e r d e p e n d i n g o n m a r k e t trend. •' Type Fixed Average Balance £ 1 00K. Accounts 2 Swiss Francs Type Call Average Balance - Sw.Fcs.290K. Accounts - 1 Statements - Monthly. Type - Call Average Balance - E C U 75K. Accounts - 1 Statements - ECU Monthly. DeutscheMarks Type Ca ll Average Balance D M . 3 0 OK. Accounts 1 Statements Monthly French Francs Type Call Average Balance F.Fcs.1m. Accounts 1 Statements Monthly. Australian Dollars Type Call Average Balance A$1.5m. Accounts 4 Transactions 20 p e r m o n t h . Interest A p p l i e d weekly. Statements Weekly. Transaction Type T r a n sfers in/out Inter Bank. f Transfers to other currencies. Inter Account transfers. U.S. D o l l ar s Type F i x e d a n d Call . Average Balance U S $ 1 .00 m. Accounts 6 Transactions R o l l o v e r of f i x e d a c c o u n t s f e w c a l l. Interest M a t u r i t y and h a l f - y e a r l y on Call A c c o u n t Statements Call monthly. Transaction Type Tr a n s f e r s in/out Inter Bank. Transfers to/from other currencies. Other Requirements * IRE Account Cheque Book Lodgments Cash in/out Loans IRE Stg.E ^ US$ B/B Guarantees Stg.E . (4WJ1 Fee ^ L e t t e r s of C r e d i t ^ Performance Bonds F.X. Q u o t e M .M . Q u o t e D e p o s i t s IRE - Rates Investment M a n a g e m e n t \ - Holding Equities/Gilts/Bonds ilua ti ons Quarterly Schedule B a l a n c e on all A c c o u n t s Appenmxmum ^£j 91 MERRION SQUARE DUBLIN 2 TELEPHONE 619744 (25 lino) 76461J-19 (9 lines) TELEX 33322 . IRISH INTERCONTINENTAL BANK LIMITED O u r Ref: ■I GQ/VH/2803 F e b r u a r y 23, 1989 lurrays E u r o p c a r L im i t e d , B a g g o t S tr e e t Bridge, '.Dublin 4. _ <^ o ^ i/ i / * D e a r Sirs, o f Irish. W e a r e p l e a s e d t o c o n f i r m th e _ In t e r c o n t i n e n t a l B a n k L i m i t e d / t " I I B " j to m a k e t h e / f o l l o w i n g f a c i l i t y a v a i l a b l e t o M u r r a y s E u r o p c a r L i m i t e d /'"the Borrower") T h e f a c i l i t y w i l l s p e c i f i c a l l y i n c l u d e the r i g n t o f IIB to require repayment on demand at a n y time and enforce any s e c u r i t y therefor. TYPE OF AND AMOPnT O F F A C I L I T Y : A t e r m l o a n «*£ u p t o IR£1,200,0<50 (one m i l l i o n t w o h u nd re d th ou s a n d I r i s h pounds) to b e pulsed b y t h e B o r r o w e r for g e n er al w o r k i n g c a p i t a l 2- CURRENCY O F F A CILITY; T h e f a c i l i t y shal l b e d r a w n d o w n i n I r i s h p o u n d s b u t m a y b e d r a w n d o w n in a n y oth e r f r e e l y a v a i l a b l e curre nc y s u b j e c t t o th e a g r e e m e n t o f I I B a n d t h e C e n t r a l B a n k o f Ireland. 3. IATEST.DRAWDOWN.PATE: T h e fa ci li ty is t o b e d r a w n d o w n i n full n o t later than M a r c h 31st 1989. E a c h d r a w d o w n w i l l b e for a m i n im um of IR£200,000 a n d n o t less t h a n t w o b u s i n e s s da ys n otice o f an in tention t o m a k e a d r a w i n g w i l l b e p r o v i d e d b y the Bo rr ow er t o IIB. 10 to Registered Num ber W 5 J7 Republic o f Irchrvd T h e i n t e r e s t r a t e o r rates on a m o u n t s o u t s t a n d i n g u n d er t h e f a c i l i t y w i l l b e s e t for ea ch d r a w i n g o n t h e da te of s uc h d r a w i n g a n d f o r su bs eq ue nt r o l l o v e r s o n the f ir s t d a y o f e a c h i n t e r e s t period. In e a c h c a s e t h e i nt er es t rate w i l l b e 3/4% a b o v e t h e rate at w h i c h IIB s hall b e o f fe re d f unds of like a m o u n t o n the Du bl in o r L o n d o n Inte rb an k Ma r k e t fo r t h e r e m a i n d e r o f t he r e l e v a n t i n t e r e s t period. T h e B o r r o w e r may, b y no tic e in w r i t i n g to IIB, n o t lat er t h a n t h r e e b u s i n e s s days b e f o r e the d a t e o f fi r s t drawdown, o r as t h e c a s e m a y be b ef or e th e e x p i r y of a n interest period, e l e c t w h e t h e r t h e n e x t f o l l o w i n g i n t e r e s t pe ri od w i l l b e o f o n e o r three m o n t h s dura ti on , o r su ch other d u r a t i o n as m a y b e a greed f r o m t i m e t o time b y IIB and f a i l i n g s u c h e l e c t i o n b y t he Borr owe r, the n e x t follo wi ng i n t e r e s t p e r i o d w i l l be of t h r e e m o n t h s duration. I n t e r e s t w i l l b e ca lc ul a t e d o n t h e d a i l y b a l a n c e o ut st a n d i n g a n d w i l l b e d u e a n d p a y a b l e o n th e l a s t d a y o f each i nte r e s t p e r i o d w i t h t h e final i n t e r e s t p a y m e n t on t h e da te of fin a l r e p a y m e n t o f t h e loan. RESERV E A S S E T S i T h e B o r r o w e r w i l l p a y t o IIB s u c h a d d i t i o n a l rate per c e n t p e r a n n u m a s I I B shall c e r t i f y t o h a v e b e e n additional c os t s t o i t in r e s p e c t of its c o m p l i a n c e w i t h a n y reserve assets o r s p ec ial d e p o s i t s or o t h e r s i m i l a r r e q u i r em en ts imposed b y a n y R e g u l a t o r y A u t h o r i t y f r o m t i m e t o tike. A m o u n t s p a y a b l e pu rsu an t t o t h i s C l a u s e w i l l be paya bl e o n t h e r e l e v a n t i n t e r e s t p a y m e n t date. IATE PAYMEHTSs I n s o f a r as a n y a m o u n t shall, b e d u e p u r s u a n t to this A g r e e m e n t a n d u n p a i d s u c h a m o u n t s h a l l b e a r interest u n t i l p a i d a t 3% a b o v e I I B /s P r ime R a t e f r o m ti me t o time (or a t s u c h l es se r r a t e as IIB shall, a t i t s discretion, determine) c a l c u l a t e d w i t h m o n t h l y rests. I I B is h e r e b y author ise d t o d e b i t any s u c h am oun t du e a n d a n y i nt e r e s t in respect t h e r e o f to a s ep ar ate a c c o u n t o f t h e B or rower to be o p e n e d f o r th is pu rpose. W i t h o u t p r e j u d i c e t o IIB's r i g h t to r e q u i r e r e p a y m e n t of ti e loan o n d e m a n d a t a n y time, i t is a g r e e d that/ unless and until IIB s h a l l e x e r c i s e s u c h right, t h e loan wi ll be r e p a i d n o t l a t e r t h a n J a n u a r y 31st, 1990. EBEPAYHBTEs P r e p a y m e n t o r p a r t p r e p a y m e n t o f the loan m a y be made on ly upo n t h e B o r r o w e r g i v i n g t o II B o n e m o n t h s p r i o r n o t i c e in ■ writing t o e x p i r e o n an i n t e r e s t p a y m e n t date. S u c h n o t i c e wil l b e i r r e v o c a b l e a n d w i l l o b l i g e the Bo rr o w e r t o . r e p a y t h e l oa n o r p a r t t h e r e o f o n t h e date specified. A n y su ch p r e p a y m e n t wi ll be s u b j e c t t o t h e p a y m e n t of a d d i tio na l i n t e r e s t o f 1% of t h e am o u n t so prepaid. S E C O R JET Y s A n y a n d a l l i nd eb te dne ss o r l i a b i l i t y o f the Bo rr o w e r t o I I B is t o b e s e c u r e d b y a g u a r a n t e e f r o m a b a n k a c c e p t a b l e to IIB. C U R R E N C Y AVAIIABII jITY i If IIB s h a l l n o t i f y the B o r r o w e r t h a t the c urr en cy i n w h i c h t h e B o r r o w e r r e q u i r e s to a v a i l o f t h e loan will n o t b e a v a i l a b l e t o II B i n s u f f i c i e n t a m o u n t in resp ec t o f t h e n e x t f o l l o w i n g i n t e r e s t period, t h e B o r r o w e r shall ei ther:(a) E l e c t t o p r e p a y th e l o a n o n t h e l a s t d a y of t h e t h e n c u r r e n t interest' p e r i o d t o g e t h e r w i t h all in te r e s t a c c r u e d d u e t o s u c h i n t e r e s t p a y m e n t date; ‘ or (b) N o t i f y IIB o f a n a l t e r n a t i v e c u r r e n c y i n wh i c h i t w i s h e s t o b o r r o w the loan. ' * If t h e Bo rr o w e r notifies I I B o f a n alte rn ati ve c u r r e n c y i n w h i c h i t w i s h e s t o b o r r o w t h e loan, t h e Borrower will, on the l a s t d a y o f the then c u r r e n t i n t e r e s t period, r e p a y t h e loan t h e n outst an di ng t o g e t h e r w i t h a l l interest and o t h e r co s ts d u e and w i l l s u b jec t t o t h e a v a i l ab il it y of s uc h a l t e r n a t i v e cu rre nc y to IIB o n t h e L o n d o n Interbank m a r k e t and t o t h e c o nse nt of t he a p p r o p r i a t e Regul at or y Au thorities, d r a w down s u c h a l t e r n a t i v e currency in a n a m o u n t e q u i v a l e n t t o the loan. T h e t e r m s and c o n d i t i o n s o f t h i s l e t t e r w i l l ap ply m u t a ti s m u t a n d i s t o all d r a w i n g s in s u c h a l t e r n a t i v e currency f r o m t i m e t o time. COSTSs A l l leg al c o sts a n d fees, t o g e t h e r w i t h all o t he r costs an d e x p e n s e s i nc urred b y IIB in t h e ar ran g e m e n t of these fa c i l i t i e s d u r i n g t h e i r t e n o r o r i n o b t a i n i n g repayment t h e r e o f a re f o r t h e a c c o u n t o f th e Borrower. PAYMENTS: A l l p a y m e n t s m ad e b y the B o r r o w e r are to b e m a d e free a n d c l e a r o f a n y a n d a l l deduc ti on s, i n c lu din g w i t h h o l d i n g t a x e s w h i c h a r e for t he a c c o u n t of t h e Borrower. CONDITIONS PRECEDENT? Drawings under this facility are subject to:(a) C o m p l e t i o n o f s u c h legal d o c u m e n t s a n d i n s uc h f o r m as IIB m a y r e a s o n a b l y r e q u i r e a n d IIB's s e c u r i t y r e q u i re me nt s h a v i n g b e e n c o m p l e t e d in a m an ner s a t i s f a c t o r y t o IIB; (b) C o m p l e t i o n b y t h e B o r r o w e r o f w a r r a n t i e s in a form acc ep t a b l e t o IIB. T h e w a r r a n t i e s r e l a t e t o such m a t t e r s as t h e a c c u r a c y o f i nf or m a t i o n f urnished i n t h e c o u r s e o f n e g o t i a t i o n s f o r t h e f a c i l i t y a n d t he a b s e n c e of a n y p e n d i n g o r t h r e a t e n e d litigation; ' (c) R e c e i p t b y I I B o f a p p r o p r i a t e in str uc ti on s as to t h e m a n a g e m e n t o f t h e a cc ount; (d) IIB b e i n g s a t i s f i e d t h a t a d e q u a t e o v e r d r a f t fac il it ie s w i l l co nt i n u e t o b e a v a i l a b l e f r o m t h e Borrower's bankers; ‘ (e) All ap pr o p r i a t e E x c h a n g e C o nt ro l and o t h e r r e g u l a t o r y con sents h a v i n g b e e n o b t a i n e d and b e i n g in full for ce an d effect; (f) Th e r e bei ng n o d e v e l o p m e n t s b e t w e e n n o w and the d a t e o f final dr awdown w h i c h in t h e o p i n i o n of IIB, w ould be li k e l y t o h a v e a ny adve rs e e f f e c t s o n t he bu si ne ss of th e B o r r o w e r or o n its f utu re prospects. 14- GQSEHafflCS: T h e B o r r o w e r h e r e b y c o v e na nt s w i t h I X B o n its own b e h a l f a n d o n b e h a l f of th e G u a r a n t o r s t ha t: - (a) S^lop.o0 0 it w i l l n o t in cur total b o r r o w i n g s in excess of IR£^~7 20 0 ;00 0 (borrowings to i n c l u d e leasing, d i s c o u n t i n g and h i r e purc ha se) w i t h o u t the p r i o r a p p r o v a l in w r i t i n g o f IIB; . . s- o&jtst. (b) y (c) (d) ius?uei-s (he f It will,-afc-anke ep all a p p r o p r i a t e a ssets i n s u r e d a g a i n s t all r ea so na ble b u s i n e s s r i s k s an d w i l l a l s o m a i n t a i n o t he r insur an ce p o l i c i e s a p p r op ri at e t o t h e its business. T h e B or ro we r w i l l p r o d u c e t o IIB o n d e m a n d a n n u a l l y a n y po lic ie s of in s u r a n c e d u e an d r e n ew al notes, and wi ll h av e.I IB 's i n t e r e s t n o t e d on t h e i n s u r a n c e policies; It w i l l f u r n i s h the f o l l o w i n g i n f o r m a t i o n to I IB in r e l a t i o n t o itself and t he G u a r a n t o r s (i) . a-6&&ts OostcCej^ It w i l l / n o t p le d g e o r ch a r g e a n y f u r the r pr op e r t y o r a s s e t s / w i t h o u t the p r i o r a p p r o v a l in w r i t i n g of IIB; A c o p y of the ir c e r t i f i e d a u d i t e d P r o f i t a n d Loss A c c o u n t a n d Balan ce S h e e t t o g e t h e r w i t h the Auditors Report thereon within months of their ..... f i n a n c i a l y e a r end; • - - ■ (ii) W i t h i n o n e month o f t h e e n d o f e ac h m o n t h end, un c e r t i f i e d T r a d i n g a n d P r o f i t a n d Loss A c c o u n t s a n d B a l a n c e Sheet? (iii) A m o n t h l y s t a te me nt s i g n e d b y a d i r e c t o r i n a f o r m a t t o b e ag r e e d w i t h I I B s e t t in g o u t details o f m o t o r v e h i cl e stocks; (e) it wi ll n o t w i t h o u t th e p r i o r ap proval in w r i t i n g of IIB e n t e r into an y b u s i n e s s o f ab normal n a t u r e outside the no rm al course of its business. o V t DEFAULTS: <1 W i t h o u t p r e j u d i c e t o IIB's ri g h t to r e q u i r e immediate r e p a y m e n t o n d e m a n d a t a n y time, IIB w i l l t e r m in at e its co m m i t m e n t t o l e n d h e r e u n d e r a n d w i l l r e q u i r e immediate r e p a y m e n t o f all m o n i e s due, i n c l u d i n g i n t e r e s t and other charges, s h o u l d a n y o f t h e f o ll ow ing e v e n t s oc cur (a) If t h e B o r r o w e r o r G u a r a n t o r s hall d e f a u l t in the p a y m e n t o f a n y s u m d ue h er eu nde r; (b) If t h e B o r r o w e r or G u a r a n t o r sh all d e f a u l t in the p e r f o r m a n c e o f an y term* c o v e n a n t o r a g r ee men t c o n t a i n e d in t h i s a g r e e m e n t an d s u c h d e f a u l t shall c o n t i n u e u n r e m e d i e d for t e n days; (c) If a R e c e i v e r o r o t h e r s i m i l a r O f f i c e r is a ppointed of a n y o f the a s s e t s of the B o r r o w e r o r Guarantor; (d) If a n o r d e r is m a d e or an e f f e c t i v e res ol u t i o n is p r o p o s e d o r p a s s e d for t h e w i n d i n g u p o f the B o r r o w e r o r Guarantor; (e) If a d i s t r e s s o r e x e cu ti on is l e v i e d u p o n or sued ou t a g a i n s t any p r o p e r t y of t h e B o r r o w e r o r Guarantor; (f) If t h e B o r r o w e r o r G u a r a n t o r s h al l s t o p payment o f its d e b t s o r w i t h o u t t h e p r i o r a p p r o v a l in w r i t i n g o f II B s h a l l c e a s e o r shal l i n t i m a t e its i n t en ti on to c e as e to c a r r y o n its business; (g) If t h e B o r r o w e r or G u a r a n t o r is u n a b l e to p a y its debt s w i t h i n t h e m e a n i n g o f S e c t i o n 214 of t h e Companies Act, 1963, o r a n y s t a t u t o r y m o d i f i c a t i o n o r re-enactment t h e r e o f ; ......... (h) If t h e B o r r o w e r o r G u a r a n t o r s ha l l w i t h o u t the p r i o r approval in writing of IIB create or purport or attempt t o c r e a t e a n y m o r t g a g e o r c h a r g e o v e r its assets o t h e r t h a n t h e c h a r g e t o IIB, o r s h a l l sell o r attempt t o sell a n y p a r t t h e r e o f o r s h a l l d e a l oth er wi se t h a n in g e t t i n g in a n d r e a l i s i n g t h e s a m e in t h e ordinary c o u r s e of business; (i) If a n y e v e nt s h al l o c c u r w h i c h li k e l y t o h a v e a d v e r s e e f f e c t s B o r r o w e r or G u a r a n t o r o r t h e i r d e t rim en ta l t o t h e i n t e r e s t o f i n the opinion of I IB is o n th e business of the f u t u r e prospects o r is IIB. HftRRftHTXES: (a) T he m a k i n g a n d p e r f o r m a n c e o f t hi s a g r e e m e n t a re w i t h i n the B o r r o w e r ' s c orporate p o w e r s a n d h a v e b e e n a u t h o r i s e d b y all n e c e s s a r y c o r p o r a t e actio ns a n d do n ot c o n t r a v e n e any la w o r c o n t r a c t u a l r es t r i c t i o n b i n d i n g o n t h e Borrower; (b) Ther e a r e n o pendi ng o r t h r e a t e n e d a c t io ns or p r o c e e d i n g s b efore a n y C o u r t o r T r i b u n a l w h i c h w o u l d b e li k e l y t o h a v e any a d v e r s e e f f e c t s o n the bus i n e s s o f the B o r r o w e r o r its f u t u r e prospects; (c) Full d i s c l o s u r e has b e e n m a d e to I I B o f all facts w h i c h o u g h t p r o p e r l y to b e m a d e k n o w n t o a b a n k c o n t e m p l a t i n g the p r o v i s i o n of fa ci li tie s t o a borrower; (d) The B o r r o w e r is not in d e f a u l t of a n y te rms or c o n d i t i o n s o f this agreement. GENERATE (a) A n y i n d u l g e n c e b y IIB in t h e e n f o r c e m e n t o f a n y t e r m o r c o n d i t i o n o f this le t t e r (or a n y a g r e e m e n t r e l a t i n g hereto) o r a waiver b y II B o f a n y b r e a c h o f a n y t e r m shall n o t constitute a g e n e r a l w a i v e r o f s u c h t e r m o r c o n d i t i o n a n d will b e w i t h o u t p r e j u d i c e to a n y o t h e r ter m o r condition; (b) Ko f a i l u r e o r d el a y b y I I B i n e x e r c i s i n g any right; p o w e r o r pri vi leg e g r a n t e d t o it h e r e u n d e r shall o p e r a t e as a w aiver t h e r e o f n o r s h a l l a n y s i n g l e o r pa r t ia l e xe rc i s e of a n y s u c h right, p o w e r o r p r i v i l e g e p r e c l u d e t he future e x e r c i s e o f a n y s u c h right, p o w e r or pr iv il eg e; ' (c) The r i g h t s a n d remedies h e r e i n p r o v i d e d are c u m u l a t i v e and n o t e x cl us iv e of a n y r i g h t s o r remedies p r o v i d e d b y law. . TIHEs In c o n s t r uc ti on of the p r o v i s i o n s h e r e i n relating to th e pa y m e n t of monies, time shall s u b j e c t t o a n y applicable peri od s of grace, be of the e s s e n c e of the contract. IOU T h e f a c i l i t y is p e r s o n a l to t h e B o r r o w e r a n d shall n o t be c a p a b l e of a s s i g n m e n t b y the B o r r o w e r in w h o l e or in part. I I B r e s e r v e s the r i g h t to a s s i g n all o r p a r t of the loan t o a n y c o m p a n y c o n t r o l l e d b y K r e d i e t b a n k N.V. o r its p a r e n t c o m p a n y w i t h o u t th e pri or c o n s e n t of the Borrower. G O V E R N I N G IA W : T h i s a g r e e m e n t sha ll be g o v e r n e d b y t h e L a w s of Ireland. ^ C CgPTAJWCE p F OF FE B: T h i s o f fer w i l l lapse o n 1 0 t h M a r c h 1989. T o a cce pt t h i s o f f e r on the a b o v e t er m s a n d conditions, th e e n c l o s e d d u p l i c a t e o f this l e t t e r sh o u l d b e s ig ne d and r e t u r n e d t o us. Yours f a i t h f u l l y # • fo r a n d on b e h a l f o f IRISH INTERCONTINENTAL BANK LIMITED D e p u t y C hi e f Exec ut iv e Id V b TELEPH L 91 MERRION SQUARE DUBLIN 2 SS? £ 619744 (25 lines) 76461J-I9 (9 lines) TELE X 33322 IRISH INTERCONTINENTAL BANK LIMITED 25 A p r i l Our R e f: 1989 G Q /V H /2803 M u rra ys E u ro p c a r L im ite d Baggot S t r e e t B rid g e D u b lin 4 Dear s i r s We a r e p le a s e d t o c o n fir m th e w il li n g n e s s o f I r i s h I n t e r c o n t i n e n t a l Bank L im ite d ( " I I B " ) t o make th e . ■ fo llo w in g f a c i l i t y a v a i l a b l e t o M u rra ys E u ro p c a r L im ite d ( “th e B o rr o w e r " ) on th e f o llo w in g te rm s and c o n d it io n s : 1 TYPE OF AND AMOUNT OF F A C IL IT Y : A te rm lo a n o f up t o S T G £700,000 (s e v e n hundred th o u s a n d S t e r l i n g pounds) t o be used by th e B o rrow er f o r g e n e r a l w o rk in g c a p i t a l p u rp o s e s . 2. CURRENCY OF F A C IL IT Y : • The f a c i l i t y .may be drawndown in any f r e e l y a v a i l a b l e c u rre n c y o t h e r th a n I r i s h pounds s u b je c t t o t h e ag re e m e n t o f I I B and th e C e n tr a l Bank o f Ir e la n d . ' • • • 3. LATEST DRAWDOWN DATE: The f a c i l i t y i s to be drawn down 1 r, f u l l n o t l a t e r th a n May 3 1 s t , 1989. N o t le s s t h a t two b u s in e ss days n o t ic e o f th e I n t e n t i o n t o make th e d raw in g w i l l be p ro v id e d by th e B o rro w e r t o I I B . /.. RcpilcreJ Number <0537 Republic or Ireland The i n t e r e s t r a t e o r r a t e s on amounts o u ts ta n d in g under th e f a c i l i t y . w i l l be s e t on t h e d a te o f f i r s t drawdown and f o r su b seq u e n t r o l l o v e r s on th e f i r s t day o f each i n t e r e s t p e r io d . I n each case th e i n t e r e s t r a t e w i l l be 3/ 4% above t h e r a t e a t w hich I I B s h a ll be o f f e r e d funds o f l i k e amount on th e London In t e r b a n k M a rk e t f o r th e re m a in d e r o f th e r e le v a n t i n t e r e s t p e r io d . The B o rro w er may, by n o t ic e in w r i t i n g to I I B , n o t l a t e r t h a t t h r e e b u s in e s s days b e fo r e th e d a te o f f i r s t drawdown, o r as th e case, may be b e fo re th e e x p ir y o f an i n t e r e s t p e r io d , e l e c t w h e th e r th e n e x t f o llo w in g i n t e r e s t p e r io d w i l l be o f one o r th r e e months d u r a t i o n , o r such o t h e r d u r a t io n as may be agreed fro m tim e t o tim e by I I B and f a i l i n g such e l e c t io n by t h e B o rro w e r, th e n e x t f o llo w in g i n t e r e s t p e r io d w i l l be o f t h r e e months d u r a t io n . I n t e r e s t w i l l be c a lc u la t e d on th e d a i l y b a la n c e o u ts ta n d in g and w i l l be due and p a y a b le on th e l a s t day o f each i n t e r e s t p e r io d w it h th e f i n a l i n t e r e s t payment on t h e d a te o f f i n a l rep ay m en t o f th e lo a n . PERIOD OF F A C IL IT Y : W ith o u t p e r j u d i c e t o I I B ' s r i g h t t o r e q u ir e repaym ent o f t h e lo a n on demand a t any tim e , i t i s agreed t h a t , u n le s s and u n t i l I I B s h a l l e x e r c is e such r i g h t , t h e lo a n w i l l be r e p a id n o t l a t e r th a n January 3 1 s t , 1 9 9 0 . SECURITY: . Any and a l l in d e b te d n e s s o r l i a b i l i t y o f th e B orrow er t o I I B 1s t o be s e c u re d i n a manner a c c e p ta b le t o I I B . I n a d d it io n t o t h e C o n d itio n s P r e c e d e n t s e t o u t i n c la u s e 1 o f I I B ’ s S ta n d a rd Terms and C o n d itio n s , d raw in g s u n d e r t h i s f a c i l i t y a re s u b je c t t o : - 8’ (a ) C o m p le tio n by th e B o rro w er o f w a r r a n t ie s i n a form a c c e p t a b le t o I I B . The w a r r a n t ie s r e l a t e to such m a t t e r s as th e a c c u ra c y o f in f o r m a t io n f u r n is h e d in t h e c o u rs e o f n e g o t ia t io n s f o r th e f a c i l i t y and t h e absence o f any p en d in g o r th r e a te n e d l i t i g a t i o n ; (b ) R e c e ip t by I I B o f a p p r o p r ia t e in s t r u c t i o n s to t h e management o f th e a c c o u n t; (c ) I I B b e in g s a t i s f i e d t h a t ad e q u ate o v e r d r a f t f a c i l i t i e s w i l l c o n tin u e t o be a v a i l a b l e fro m th e B o r r o w e r ’ s o t h e r b a n k e rs ; as STANDARD TERMS AND CONDITIONS: The f a c i l i t y i s s u b je c t t o I I B ’ s S tan d ard Terms and C o n d itio n s w h ic h a r e a t ta c h e d h e r e to and w h ich fo rm p a rt o f th is f a c i l i t y l e t t e r . 9* A C C E P TA N C E O F O F F E R : T h is o f f e r w i l l ' . la p s e on 1 s t May 1989. To a c c e p t t h i s o f f e r on t h e above term s and c o n d it io n s , th e e n c lo s e d d u p li c a t e o f t h i s l e t t e r s h o u ld be s ig n e d and r e t u r n e d t o us, t o g e t h e r w it h th e a tta c h e d fo rm f p r t h e o p e n in g o f an a c c o u n t Y o u rs f a i t h f u l l y , f o r and on b e h a lf o f IR IS H INTERCONTINENTAL BANK LIMITED E A MARAH D e p u ty C h ie f E x e c u t iv e ^ A s s o c k *t6 ’~D1 A c c e p t e d on t h e a bov e T er ms and C o n d i t i o n s t o r . a n d on B e h a l f o f MURRAYS EUROPCAR L I M I T E D ____ _____________________ Authorised Signatory Authorised Signator n ~7'w TS H~~I N T E R C O N T I N E N T A L BANK LTD IN TER N A L MEM ORANDUM Maurice Leonard from Maureen Collins cc.JRJCG/pF d a te 22nd July, 1993 * 4 s u b je c t to CIBTC/Ham ilton Ross The following is a summary of the "CIBTC/Hamilton Ross related” cash backed facilities arranged by IIB:• Deoosttor Location of Cash Deposit GBP7.47m approx CIBTC KB London GBP1.45m GBP1.49m approx CIBTC KB' London IIB GBP5.5m GBP5.51m approx CIBTC KB London KB London GBP1.75m GBP1.775m Tristan Securities IIB02/72605/77 Loan Facilitv Lender/ Guarantor Facilitv Limit Carlisle Trust MB GBP7.3m Lyndon Properties IIB Alstead Securities (1) Tepbrook Properties 1 Minimum Cash ‘ Oeoostt Required •- 02/72605/00 Field Corbett, Carey, Russell IIB •GBP120k GBP140k CIBTC (2) Joe Malone IIB USD350k USD350k CIBTC HB02/eee39/77 Y N i* IIB03/01545/77 Messrs. Morris. IIB IEP150k GBP150k CIBTC (2) IIB025T32737/77 Galtymore Dance Club IIB ($*<>*? GBPIOOk GBPIOOk CIBTC ■ykJS'? •• IIB02/BS9B4/77 Ru Leonard IIB IEP30k GBP30k CIBTC IIB02/QQ+64/77 Kentford Securities iib m >y IEP25k GBP50k (3) CIBTC (2) IIB02/00272/81 Celtic Helicopters i>b USD75k USD75k Hamilton Ross IIB03/393.I2/77 IEP100k GBPIOOk CIBTC (2) 11302/0161 S/77 Guarantees Celtic Helicopters ") \U .o \v IIB 0. . • Notes ) Credit approval exists for limit of GBP9.5m with matching cash deposit. (2) Depositor expected to be changed from C IB TC to Hamilton Ross Co. Ltd. (3) Credit approval exists for deposit to be reduced to GBP30k. rvota. ML Z.40C>v ) icher Cayman/ Hamilton Ross Company - Related Facilities Note ver 03-Jan-96 Facility Limil Lender/ Guarantor Min Cash Deposit Reauired -acililies !e Trust d Securities 1 n Properties Corbelt,Carey & Russell s. Morris la Investments Ltd la Investments Ltd ^ ’ V GBP 8.8m GBP 7.8m GBP 8.8m GBP 7 8m IIB IIB GBP 1,4m* . IEP 120k IEP 150k GBP 1:4m ' • % l GBP 140k GBP 150k IIB IIB IEP 310k IEP 646k (1) IIB (2).(3) IIB (4) IIB IEP 310k IEP 646k lintee Facilities ook Properties............... .......... HB-------------------..... GBP-Wim— — GBP-1.55m— GBP 950k :ook Properties IIB jnore Dance Club IIB GBP 100k GBP 950k GBP 100k j Mrs T Leonard IIB IEP 45k GBP 46k Helicopters Helicopters Eastwood IIB IIB IIB USD 75k IEP 100k USD 15k USD 75k . iposil of IEP88.000 (02/06838/77) also charged to IIB iposil of IEP37.500 (02/06838/77) also charged lo IIB edit approval exists for limil of GBP 9m with matching deposit, iposil of IEP24.500 (02/06833/77) also charged to IIB 05 : GBP 100k GBP 15k Depositor and Guarantor Location of Cash Deposit Review' Maturity Date Date Ansbacher Cayman Ansbacher Cayman KB London 300886 30-Sep-95 31-Mar-98 KB London 300887 30-Sep-95 31-Mar-97 Ansbacher Cayman Hamilton Ross Ansbacher Cayman KB London 300885 IIB 02/39406/77 2B-Feb-9$ > Ansbacher Cayman 30-NOV-96 IIB _____ ... 30-Jun-96 . 02/02737/77 (IB 01/45630/00 i «f/a ft >34^JuS-85•IIB 01/45630/00 3^dnf*95- -Tristan-Sesurilies— -I I B-O2/72605ff7- -31-Bcc-05--------34-D ee-97- Tristan Securities Ansbacher Cayman IIB 02/72605/78 31-Dec-95 31-Dec-97 IIB 02/02991/77 Ansbacher Cayman IIB 02/03164/77 IIB 03/3931?/77 UB 02/39359/77 IIB 02/00642/77 31-Aug-96 31-Oct-97 30-Jun-96 30-Jun-96 30-NOV-96 31-Oct-O1 31-Oct-OO 30-Apr-01 30-Jun-98 Ansbacher Cayman Hamilton Ross Hamilton Ross Ansbacher Cayman 28-Feb-§ft J 30-NOV-98 30-Jun-96 28-May-98 30-Jun-99 ‘ 30-Nov-97 Appendix The Restructuring o f the Securityfor the Lyndon and Carlisle Loans The nature o f the security held by KB London as against Ansbacher changed in 1993. It ultimately ended up in the form that Ansbacher held the London deposits in trust for two Cayman Island companies called Yale and Tristan which had substantially common directors with Ansbacher, but which were not subsidiaries o f Ansbacher. Yale and Tristan declared that they were the beneficial owners o f the deposits and joined in the security accordingly. Because Ansbacher now only held the deposits in trust for Yale and Tristan, it was no longer necessary to show these deposits as secured deposits on Ansbacher’s accounts (or in the consolidated accounts o f Ansbacher’s new owners, a South African Bank). This was probably a‘matter o f concern to the South African Bank because a bank in the normal course o f events would hope that its own guarantee is sufficient standing alone without the necessity for any form o f cash backing and the disclosure o f cash backed guarantees in a bank’s accounts might be taken as a sign that the bank was not financially strong or otherwise in the highest standing. IIB, for example, as a matter o f policy, never pledges its own deposits as security. It took nine months o f very detailed negotiations, primarily between IIB’s London solicitors and Ansbacher’s attorneys in the Cayman Islands (Myers and Alburga) to devise, negotiate and complete this restructuring which was entirely internal to Ansbacher and its new South African owners, i.e. it was an internal requirement o f Ansbacher and the South African bank. It had nothing whatsoever to do with the borrowers in question (Lyndon and Carlisle Trust) who to the knowledge o f IIB were not even aware that such restructuring was taking place and their consent was not needed in any way (because the loan facility letter with its general reference to such security as IIB might require ensured that no further consent was needed from the borrower). Even IIB was not particularly concerned or involved in the matter save for keeping an eye on it to ensure that nothing was done which would adversely impact on IIB’s guarantee from Kreditbank (bearing in mind that the guarantee was only good for so long as Kreditbank had effective recourse against the deposit in London). This process started, from IIB’s perspective, with a request from Mr. Traynor to IIB at a meeting on the 9th September, 1992. Mr. Reynold’s note records that Mr. Traynor asked IIB to facilitate restructuring the transaction so that the deposits would be “off balance sheet” o f Ansbacher. Mr. Traynor explained Evidence o f Siobhan Lynch, page 33-34; also page 46. that Ansbacher had now been acquired by a South African bank and the request to take the deposits “off balance sheet” was in that context. Ms. Lynch attended that meeting and has given evidence of it.95 A very long process o f negotiation and discussion then took place between the solicitors in London and the Cayman Islands. IIB were, happy with the security they already had and, as Ms. Lynch put it, “we really didn't drive this , at all. Frankly, from our point o f view, it was more o f a nuisance."96 When the „ final version o f the structure emerged, IIB were satisfied : “From our point o f view, we had Cayman lawyers review it, we had our own lawyers review it. We got confirmation that Yale and Tristan were the beneficial owners o f the deposits. So the new structure gave us the security we had when we started off in 1992 with this process and we ended up with the same security structure. So it was implemented essentially in June, 1993.”91 A somewhat more detailed account of how the restructuring came about is contained in a document sent by IIB to the Inspectors as part of the response o f IIB to issues raised by the Inspectors during their interviews with Mr. Barnes and Mr. Reynolds. Ms. Lynch confirmed in her evidence that the account which is produced in the transcript at pages 103-106 is correct. In matter VII in the Inspectors’ preliminary conclusions, the Inspectors seem to be under the impression that the funds with Kreditbank in London could have been changed and were changed to a trust status “without any difficulty” On a number o f times, in the course of examining witnesses, Inspector O’Leary has questioned how a deposit could be changed to a trust status “at the stroke o f a pen” with, presumably, the same implication that it could be done without any difficulty. Although the Inspectors have never spelt this out, the point they are presumably making is that if it could be done without difficulty, then perhaps the monies in question were trust monies all along and this presumably is then used by the Inspectors to support the conclusion that IIB were aware that the Ansbacher deposits in Dublin were held in trust for Irish residents which in turn is the spring board for the leap to the conclusion that IIB was aware that Mr. Traynor was accepting deposits from persons in Ireland and thus carrying on an unlicensed banking business in Ireland. Even were the facts as the Inspectors assumed (ie. that the status of the money could be changed to a trust status “without any difficulty”) the leaps in inference and logic required to get to the conclusion are, in IIB’s submission, entirely unwarranted. It is respectfully submitted that if one attempts to identify the chain o f reasoning which may have been adopted by the Inspectors one can see how tenuous it is. Evidence o f Siobhan Lynch, page 80-81. Evidence o f Siobhan Lynch, page 84. Evidence o f Siobhan Lynch, page 84. But in any event, on the facts, the premise is wrong. The deposits in London could not be and were not changed to a trust status “at the stroke o f a pen.” The documents reflect the very long and involved process which was gone through in order to restructure the security. Indeed, Ms. Lynch was careful to make clear that it was not, as was suggested by Inspector O’Leary, merely raised as a “possibility” in September, 1992 and then “acted on” nine months later: ' “No, it was acted on for nine months, we worked on it fo r nine months. We dealt with it all during that period. In other words, the difference is I think in September he obviously came and said “again, would you put it in trust ? ” and we said "look we have to get X amount of advisors” and we asked him to pay the fees, which he agreed to do for [that] exercise. On that basis we then went and spent the nine months dealing with this particular request.”9* The fees which were paid by IIB to Cameron Markby Hewitt in 1993 came to Sterling £25,000.00 approximately." This was a substantial amount and belies any notion that this was a change effected without any difficulty. Whether it was difficult or not, the fact that it was restructured so that the beneficial ownership was vested in two other companies controlled by Ansbacher but not subsidiaries o f Ansbacher and thus achieving the requirement to keep the deposits in the name of Ansbacher off balance sheet, does not imply that the monies that were in Ansbacher’s name had always been trust money. Indeed, the very strong implication is precisely the opposite. The whole problem that Ansbacher had over the nine months was that the funds were beneficially owned by Ansbacher. If they were held in trust for a third party, there would have been no difficulty and they could have been kept off balance sheet without further ado. It was precisely because they were beneficially owned by Ansbacher and that they were trying to create a divorce between the legal and beneficial ownership that created the difficulty. Thus, it seems certain (on the evidence available to HB) that the true and correct position is that the deposits were beneficially owned by Ansbacher and were not held in trust until such time as a specific structure was created whereby Ansbacher executed some form of declaration o f trust and held the money for the benefit of Yale and Tristan. Still less can it be said that the deposits in question were held for the benefit of Lyndon or Carlisle Trust (as the case may be). They had nothing to do with the matter at all. Q. /■■v 99 100 Judge O’Leary : "Would it have struck you at all that companies that ultimately popped up as being the beneficial owners were in fact companies serving exclusively the interests o f Mr. Clayton Love and Mr. John Byrne ? ,,I0° Evidence o f Siobhan Lynch, page 100-101. Evidence o f Siobhan Lynch, page 102. The Inspectors have not furnished us with any evidence to support the suggestion in this question. A. "Not at all. So the whole thing is to do with Ansbacher, i t ’s balance sheet requirements, that was constantly re-iterated in the correspondence we saw. So no. In fact our perception would have been that the borrowers, being Lyndon and Carlisle had no knowledge o f this because we certainly, this was all to do with Ansbacher, we had no interactions with the borrowers about this." [She then makes the point that the general nature o f the security clause in the facility letter facilitated this].... So the borrowers never featured in any o f this from our point of view. Q. “You never had to go back to the borrowers to get them involved in this restructuring ? ” Q. Judge O’Leary: "Didyou think it was being done without their knowledge ? ” A. ‘‘I think so, I think it was all to do with Ansbacher Limited and its change o f ownership and its accounting requirements. That is it, what I think it had to do with it. ”m In the original interviews with Mr. Reynolds and Mr. Barnes, the Inspectors had focused on a letter from IIB of the 24th June, 1993 from Ms. Claire Gannon to Ms. Joan Williams in which Ms. Gannon referred to the fact that a new security structure had been implemented and “CIBT now holds the deposits with KB London as trustee for the beneficial owner"102 It is clear form the letter to which this is the reply (letter from Ms. Joan Williams of the 21st June, 1993 to Ms. Claire Gannon) that Ms. Williams had raised two points o f detail in relation to reconciling figures from the accounts and the bulk of Ms. Gannon’s letter is taken up with explaining those particular queries. The introductory sentence which refers to the new security structure is only by way of background and does not add anything to the matter one way or the other. Tepbrook Properties The Inspectors also raise a question concerning a loan to an English company, Tepbrook Properties Limited which was established to acquire a property in London. This was a mirror image of the Lyndon and Carlisle Trust transactions in that the loan was actually made by KB in London secured by a guarantee from IIB in favour of KB London which guarantee was in turn secured by the guarantee of Tristan Securities Limited supported by a lien on deposits held by Tristan with IIB. It is apparent from an internal memo from Claire Gannon of the 26th August, 1992 that when this transaction was initially proposed, it was suggested that Ansbacher would give a guarantee supported by a lien over a deposit account held in trust by Ansbacher. However, this was not acceptable because of the Evidence o f Siobhan Lynch, pages 87-88. CIBT was Cayman International Bank and Trust Company Limited, which was the same corporate entity as Ansbacher which had changed its name. I R I S H S l T E R C O N T I N E N T A L f i b A N K INTERNAL MEMO From To " ..... = ” ...... 4 File cc SL Claire Gannon Date Subject S-M . M o r r i s L i m i t e d / R u Leonard . J u n e 12, 1 9 9 2 Security for the above facilities includes a lien over deposits h e l d b y A n s b a c h e r L i m i t e d w i t h II B. We have received a request from A n sb ac he r Lim it ed to rename these Deposit Accounts "Ansbacher Limited In T r u s t For F6894", and "Ansbacher Limited in Trust for T7Q03" and n o t t o include these accounts on any audit confirmations. I contacted K e v i n McHugh of S K C regarding the d u t y of the Bank to the audi t o r s u n d e r audit letters a n d t h e amount of information on customer accounts required to b e disclosed. He informed m e t h a t to omit a c counts h e l d on t rust w o u l d b e m isleading to the auditors, h o w e v e r su c h accounts may b e o m i t t e d p r o v i d e d the Ba n k s p e cifies in a footnote that the customer holds additional accounts with IIB on trust. CG/as The Request to Redesignate Two Accounts In IIB as Trust Accounts On the 5th June, 1992, Mr. Traynor wrote to Mr. Paul Naessens, a solicitor within the Legal Documentation Section who reported to Ms. Lynch. The letter reads as follows “/ would be grateful if this deposit account [which was a deposit account which secured a small loan to Mr. Ru Leonard] presently standing in the name o f Ansbacher Limited could be designated “Ansbacher Limited In Trust Re. C. 7003 ” and NOT included on any audit confirmations to Ansbacher. I would be grateful ifyou would confirm that this is in order. I f you have any concerns I would appreciate if you could ring m e ”104 Mr. Naessens who had joined the bank the previous year as an executive in the Documentation Unit gave evidence that he remembered the letter o f the 5th June, 1992. He thought Mr. Traynor probably wrote to him because Mr. Naessens had prepared the documents on the Ru Leonard account and would have sent them out to Mr. Traynor. Ms. Lynch asked Mr. Naessens what he thought o f the request and after a very short period of consideration (one or two minutes), Mr. Naessens said that it was not appropriate to redesignate the account as a trust account because the funds were beneficially owned by Ansbacher: “7 was certain o f that really because o f the overall background knowledge and how the transaction was put together and the documents that Ansbacher signed and so fo rth ”'05 In relation to the Tepbrook transaction, where the file memorandum is dated the 26th August, 1992, Ms. Lynch said in evidence “the request in relation to the KB London deposit was raised in September, 1992, it just took nine months to come up with a structure. Clearly in this case [Tepbrook] we didn’t come up with a structure, and, therefore, they weren’t in trust. So we were able to conclude the loan on the basis o f Tristan giving us the deposit.” Page 100. Emphasis in original. The impression Mr. Naessens formed at the time on reading the letter was that Mr. Traynor wanted to redesignate the account for accounting purposes to keep the deposit account off the audit confirmations which would be given to Ansbacher (or perhaps more precisely, Ansbacher’s auditors). Mr. Naessens confirmed that this was his actual impression at the time on reading the letter and not merely surmise that he was now making.108 * Furthermore, he confirmed that even reading it now, he forms the same impression, namely that it is a request which is driven by a requirement to keep the deposit account off the audit confirmations to Ansbacher. Ms. Lynch agreed with Mr. Naessens and said that she would get Claire Gannon to look at the accounting side of the matter. Although Ms. Lynch does not have an actual recollection of the matter, she has given evidence that she probably asked Claire Gannon to look at it because she had a post graduate degree in business and would be more familiar with accounting type issues.107 It is clear from Ms. Gannon’s memorandum of the 12th June, 1992 that she checked with IIB’s own auditors, SKC, as to the duty of the bank to auditors under audit letters and the amount of information on customer accounts required to be disclosed. This was a very proper request for Ms. Gannon to make having regard to the fact that the bank’s customer, Mr. Traynor, was asking the bank to redesignate an account (in fact two accounts, because by this stage a similar request had obviously been made in relation to the deposit securing the loan to S. & M. Morris Limited) in a way designed to affect what IIB would disclose to Ansbacher’s auditors by way o f audit confirmations. Mr. Kevin McHugh of SKC informed Ms. Gannon that to omit accounts held on trust would be misleading to the auditors unless the bank specified in a foot note that the customer held additional accounts with IIB on trust. Ms. Lynch surmises that they would have not ignored the request from Mr. Traynor: “I actually surmised that we would not [have] ignored the request from Mr. Traynor, I think we would have reverted to him and advised him that even if we did redesignate the accounts per his request, we would still have to disclose them on the audit cert."m Ms. Lynch thinks, as a matter of probability, that she went back to Mr. Traynor with the information which Ms. Gannon had got from SKC and that Mr. Traynor left it at that. “Nothing happened. The accounts were not redesignated, they continued to be disclosed on audit certificates. My own suspicion would be that Mr. Traynor, presumably, recognised that we could not accommodate his request and he did not ask us to pursue the question Evidence o f Paul Naessens, 28th February, 2002, pages 4-5. Evidence o f Paul Naessens, page 5. Evidence o f Siobhan Lynch, page 49. Evidence o f Siobhan Lynch, page 53. o f redesignating the accounts. I f he had done so, we would have had to redo all o f our security, we would have had to seek legal advice as to what the implications for our security o f this were, so I know we did not do that. Therefore, we just left the accounts as they were and I assumed that he actually confirmed to us to do so.”109 / Ms. Lynch also confirmed in evidence that Mr. Traynor,'s request did not spark any concern on her part that the deposits which were the loans to S.M. Morris Limited and Ru Leonard were trust accounts or that any o f the other Ansbacher deposit accounts were therefore trust accounts. She explained that if it had raised such a concern, then : c o n c e r n i n g ‘7 would have been very concerned about the basis o f our security and all the security documentation which I was responsible for, and I would have immediately had to basically raise this issue, get legal advice and I personally would have felt very responsible about that issue. So, no, I did not think that this changed the basis o f the deposits, I thought that these were Ansbacher’s deposits and Ansbacher had given us the security in relation to the deposits.”“° She also confirmed that she did not think otherwise in relation to the two particular deposit accounts in question as distinct from the general body of Ansbacher deposit accounts. Ms. Lynch was asked to speculate as to why Mr. Traynor might have thought that the redesignation o f these deposit accounts would have been an acceptable mechanism to take the deposits out of the audit confirmations. She replied that since the deposit accounts were hypothecated and were thus not freely available to Ansbacher, it may have been that Mr. Traynor thought that in such circumstances the bank might have been prepared to designate the account as “in trust” which, o f course, the bank was not prepared to do because it did not reflect the reality of the situation. It seemed, at the time, very unlikely that Mr. Leonard had in fact any sort of deposit account. Mr. Donlon gave evidence in relation to the loan application by Mr. Ru Leonard. Mr. Donlon knew him slightly and knew that he had worked in Guinness & Mahon but had left when they were reducing their staff. He had worked at some stage with a company called IAS in Shannon but that company got into financial difficulties and he was laid off. He came to Mr. Donlon looking for a job with IIB which Mr. Donlon could not give him. Mr. Donlon was thus surprised to see about a year later a loan application coming in from Mr. Leonard with the support o f Ansbacher. The purpose of the loan was to buy a garage or a filling station in Greystones. Mr. Donlon assumed that Mr. Traynor was helping him out to find a way of making a living.111 Evidence o f Siobhan Lynch, page 54. Evidence o f Siobhan Lynch, page 57. Evidence o f Liam Donlon, 28th February, 2002 pages 17-18. Mr. Donlon therefore considered Mr. Leonard as very unlikely to have money on deposit somewhere, particularly in the context of Ansbacher. We can speculate that Mr. Traynor was assisting Mr. Leonard because he probably knew Mr. Leonard from the days when Mr. Leonard had worked in Guinness & Mahon. 4 Indeed, there were only four resident personal borrower^ ,!whose loans were introduced and secured on Ansbacher deposits. They were : Mrs. Ciara Byrne (wife o f John Byrne) Conor & Jacqueline Haughey Mr. Ru Leonard Mr. Sam Field Corbett and his two partners With the exception o f Mrs. Byrne, it did not appear to IIB that the others were persons who would, in the nature of things, have necessarily had substantial deposits. The position of Mr. Leonard has already been explained. Mr. Donlon has given evidence that the loan to Conor and Jacqueline Haughey was to fund an overdraft to Bank o f Ireland which was initially £60,000.00 with another tranche o f £25,000.00.112 It seems inherently unlikely therefore that Mr. & Mrs. Haughey had substantial deposits with Ansbacher or otherwise. Mr. Field Corbett who was clearly working closely with Mr. Traynor, was actually turned down in his loan application with his partners which was for the purpose of a small property in South Circular Road and only managed to get the loan subsequently when he was able to bring Ansbacher on board as offering the security (which he was presumably able to do by virtue o f his connection with Mr. Traynor and where he had, apparently, opened a deposit account with Ansbacher.113 The Inspectors have suggested that Mr. Traynor’s letter of 5th June, 1992 could equally be read as identifying that his primary concern was trust status and that the audit confirmation was a mere secondary consequence. The fact that Mr. Leonard did not have a deposit account with Ansbacher demonstrates conclusively that Mr. Traynor’s primary concern was not only trust status per se but was a concern to remove the secured deposit account from the audit confirmations. In summary, the Inspectors have referred to the following "matters"114 in support o f their preliminary conclusion that IIB knew that accounts opened by Ansbacher (and Hamilton Ross) were trust accounts for and on behalf of Irish residents • The initial proposal by Ansbacher in 1992 that the deposit to be placed by Ansbacher with IIB to secure the proposed facility to Tepbrook Properties should be placed by Ansbacher in trust. Evidence o f Liam Donlon, 20th February, 2002 pages 19-20. The Sam Field Corbett loan will be dealt with in more detail in the next chapter. Other than the unconnected reference to Mr. Field Corbett having "entrusted” monies to Ansbacher which is dealt with in detail at Chapter 5. • The request made by Ansbacher in September 1992 that the deposits placed by Ansbacher with Kredietbank to back Ansbacher’s guarantees securing facilities granted by IIB to Lyndon Properties and Carlisle Trust should be redesignated from "Ansbacher" to “Ansbacher in trust" and the subsequent redesignation of such accounts (after a period of nine months o f negotiation). 1 • The request made by Mr Traynor in June 1992 that the deposits placed by Ansbacher securing facilities given by IIB to Ru Leonard and S & M Morris should be redesignated as being held by Ansbacher “in trust". It is IIB’s submission that the evidence clearly shows that the matters referred to above are related and arose as a result or a desire to move deposits placed by Ansbacher (to back guarantees being provided by Ansbacher) off balance sheet in advance o f the proposed sale of Ansbacher to a South African bank. It is also IIB’s submission that the evidence clearly shows that the deposits placed to secure the facilities as referred to above were not held on trust for Irish residents (including the borrowers). In relation to the Ru Leonard/S&M Morris deposits, the relevant evidence is as follows:• Mr Traynor expressly stated that the reason for his request was that he did not want the existence of these deposits to be included in any audit confirmation to Ansbacher which indicates that this request was part of Mr Traynor’s intention to move certain deposits securing Ansbacher’s guarantees off balance sheet. • The deposits were placed by Ansbacher as beneficial owner and IIB’s security was dependent on the deposit being beneficially owned by Ansbacher. If IIB had any suspicion that this was not the case then IIB would have taken immediate steps to protect their security by ensuring that the beneficial owner o f any such deposit was joined to the transaction. This would also have cast doubt over the validity of IIB’s security for other Ansbacher secured facilities which would have added to the seriousness of any such suspicion and, in these circumstances, it is inconceivable that IIB would not have taken immediate action to protect its security if it had developed any suspicion that these deposits were held on trust by reason of this request. • IIB have been advised during the course of recent interviews before the Inspectors that Ru Leonard did not in fact have a deposit with Ansbacher. This shows that the request by Mr Traynor to redesignate the deposits securing Ru Leonard’s facility (and presumably the identical and contemporaneous request made by Ms Traynor in relation to the deposit securing the S&M Morris facility) could not have been motivated by the fact that such deposits were in fact held on trust for those borrowers. In relation to the Tepbroook transaction and the restructuring of the Lyndon/Carlisle facilities, the evidence is as follows:- • Ansbacher expressly warranted in legal documentation that it was the beneficial owner of deposits placed by it securing the Lyndon and Carlisle facilities. • When Mr Traynor requested IIB to redesignate the deposits securing the Lyndon/Carlisle facilities from "Ansbacher” to “Ansbacher in trust" in September 1992, he was asking IIB to facilitate Ansbacher in the maintenance o f these deposits off balance sheet in a “similar fashion to the recent Tepbrook transaction It was Mr Traynor’s stated intention that the purpose of the request was to move these deposits “off balance sheet ” as was clearly his intention during the earlier Tepbrook transaction also. If these deposits were, as a matter of fact, held on trust for third parties, then those deposits would have already been “off balance sheet” and therefore Mr Traynor’s stated intention would already have been achieved • Mr Traynor’s stated intention could only arise, by definition, in circumstances where Ansbacher owned the deposits in question in the first place Mr Traynor’s stated request was with a view to retaining the de facto ownership o f those deposits notwithstanding the balance sheet treatment of those deposits after the event. There would have been no reason for the parties to enter into nine months o f negotiations which involved both London and Cayman Island lawyers if, in fact, the deposits were already held on trust. When considered in hindsight it is clear that the requests concerning the treatment of certain o f the hypothecated deposits commencing in mid 1992 and ending in mid 1993 (with the creation of the Tristan and Yale structures for the Lyndon and Carlisle facilities) are wholly and only consistent with an exercise by Ansbacher in relation to the movement by it of these deposits off balance sheet in advance o f its sale to a third party. It is precisely because these deposits were not trust monies that this whole exercise was necessary. There is accordingly no basis on which these requests or references to "trust” could or should have led IIB to conclude that the hypothecated deposits were trust monies for the benefit o f Irish residents. Appengixfgg), Dame St., Dublin 2. Telephone: (01) 671 6666 Fax: (01)6716528 C e V T R fllB ftN K O f I H C t f lN D PADRAIG MCGOWAN Dfcector General «J 8'September 1997 . ; ’'j S: 1 f ' 1: i iMr. Edward A. Marah . . r : Chief Executive Irish Intercontinental Bank Ltd. 91 Merrion Square Dublin 2 Dear Mr. Marah The report o f the Dunnes Payments Tribunal draws attention to the fact that in respect of certain transactions there may have been an evasion of -exchange control legislation. The Minister for Finance has asked the Central Bank to investigate and report to him on this matter. The Bankacted as agent for the Minister in die implementation of the exchange controls which would have applied to such transactions. In turn, Authorised Dealers - among them Irish Intercontinental Bank Ltd. - had specifically delegated authorities and obligations under the exchange control regulations. In response to the request from the Minister, the Central Bank is _ undertaking a full and urgent investigation into the references in the Tribunal Report which appear relevant in the context of the exchange ’ controls. Instances of specific reference, inter alia, to Irish Intercontinental Bank in the Report are on pages 39, 40 and 47. C€NTRfll OfINK Of IR€lflND Continuation Sheet Prima facie it would appear that certain funds deposited With your bank in the name of non-resident entities were beneficially owned by Irish residents. As an Authorised Dealer your bank was required to verify on the opening of such accounts the residential status of the beneficial owner(s) of the deposits in questioa In addition, it would appear that the instructions p openand pperajg tfrese accounts were received frqrn Irish residents who also carried out transactions across the relevant accounts. I would ask you to undertake an appropriate examination of Irish Intercontinental Bank Ltd. records and to inform the Central Bank of all relevant details in relation to these accounts and transactions. I would like you to deal with this as a matter of urgency: Further clarification in relation to this matter, if required, is available from Dr. Liam O’Reilly of this office. Yours sincerely IRISH INTERCONTINENTAL BANK EDWARD MARAH I CHnr ixtcuTivi Dr. Padrajg McGowan Director General Central Bank of Ireland P.O. Box 559 Dame Street Dublin 2 11th September, 1997 Dear Dr. McGowan I refer to your letter of 8th September regarding the report of the Dunnes Payments Tribunal and to my subsequent conversations with Dr. Liam O'Reilly. 'i . We have carried out an examination of our records and have satisfied ourselves that we have not breached any exchange control regulations in force at the relevant times. The position may be summarised as follows:1. The relationship with Ansbacher Cayman Ltd. was introduced to Irish Intercontinental Bank CUB") by Mr. Richard Fenhalls, a former non executive director of IIB and chief executive of Henry Ansbacher in London. 2. Before opening the account, we satisfied ourselves that Ansbacher was a properly constituted bank licensed in the Cayman Islands. Its chairman was Mr. Des Traynor, former managing director of Guinness &Mahon in Ireland and then chairman of CRH pic and Hibernian Insurance pic. Mr. Traynor was a man of considerable standing in the Irish business community. 1 3. The Tribunal also focused on the deposit accounts maintained by Hamilton Ross Co. Ltd. with IIB. Again, on the opening of these accounts, appropriately authorised account opening documentation WISH (N TtH CO N TIN EN rAl. BANK LIMITED • 91 M lfW JON SQUARE, DUBLIN 1 • T E U fH O N E . 01 6619744 • FACSIMILE. 01 6783034 • TELEX. J3 JZ 2 ' REGISTERED IN T H E REPUBLIC O f IR ELAND N U M B ER 40S37. A SUBSIDIARY O f KR EO IETSAN K N.V. ... ........ I Dr McGowan, Central Bank of Ireland 11th September, 1997 was received. This included appropriate board resolution from the non resident company and appropriate declarations confirming the beneficial owners of the deposits were non resident. 4 . At no time prior to the Tribunal were we aware that (or had any reason to enquire further whether) the beneficial owners o f the deposit monies might be other than non resident. 5. In each case, the authorised signatories on the accounts included, .. inter alia, Mr. Traynor. Withdrawals from the accounts were ! properly authorised in accordance with the authorised signatory list furnished to us. As a matter of interest, in no case were withdrawals made payable to the individuals the subject of Mr. Justice McCracken's enquiry. 6. In all cases, lodgements info the accounts were from off-shore sources. In relation to the specific question raised by Dr. O'Reilly as to the three drafts each for GBP70,000, these were sent on different dates to us by the secretary to Mr. Traynor on behalf of Ansbacher Cayman Ltd. for lodgement to Anshacher's sterling deposit account. H ie drafts were issued by an Isle of Man bank. Their lodgement by Mr. Traynor’s secretary to the sterling account of Ansbacher, a non resident bank, did not in our view, have any exchange control implications. Needless to say, if you require any further information or explanation w e are at your disposal. Yours sincerely, Ed w a rd A . Marah C h ie f E x ecu tiv e .. ANALYSIS OF LODGEMENTS Irish Bank Originated Bank Transfers No. % IEP Millions Value 7 1.1 3.3m 3.4 % Cheques & Drafts Payable to Ansbacher/IIB (Note 1) 22 3.4 0.99m 1.0 Cheques & Drafts Payable to Third Parties (Note 2) 16 2^5 2.0m 2d 45 2A 6.29m 6.56 353 54.6 81.77m 85.3 49 7.6 0.97m 1.0 125 19.3 6.82m 7.1 75 11.5 0.04m 0.04 Sub Total 602 93 89.6m 93.44 TOTAL 647 100 95.89 100 Sub Total Non Irish Bank Originated Bank Transfers Cheques & Drafts Payable to Ansbacher/IIB Cheques & Drafts Payable to Third Parties Dividend Warrants Note 1: 4 of these were Irish pounds Note 2: 8 o f these were Irish pounds Cli ANALYSIS OF AN SBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 CREDIT ENTRIES Ansbacher Credit Entries (excluding inter account) Total IIB Credit Entries 1991 1992 1993 1994 1995 1996 1997 Total No. 170 118 100 76 53 126 4 647 41,000 42,000 44,000 50,000 53,000 53,000 55,000 338,000 ANALYSIS OF ANSBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 ANALYSIS OF CREDIT TRANSACTIONS Total No. 2,215 1991 435 1992 486 1993 456 1994 380 1995 171 1996 200 1997 87 Less . Inter account transfers 1,568 265 368 356 304 118 74 83 Lodgements of funds 647 170 118 100 76 53 126 4 Total No. of Ansbacher Credit Entries No No % Value IEP Bank Transfers/drafts/cheques payable to Ansbacher 421 65.08 86.21 89.91 84 63 51 53 46 120 4 Bank Transfers/drafts/cheques payable to IIB 12 1.85 0.83 0.87 3 - 3 4 2 - - Dividend Warrants 75 11.59 0.04 0.04 39 32 2 2 - - - 139 21.48 8.82 9.18 44 23 44 17 5 6 647 100 95.89 100 Cheques and drafts payable to Third Parties Total IIB Credit Transactions Value % 338,000 41,000 42,000 44,000 50,000 53,000 53,000 55,000 ANALYSIS OF ANSBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 ANALYSIS OF THIRD PARTY CHEQUES AND DRAFTS Cheques & Drafts Payable to Third Parties Foreign Currency Irish Pound Total No. % 131 94.24 7.02 80 8 5.76 1.8* 20 139 100 8.82 100 Amount IEP % * One of these 8 cheques, payable to College Trustees totalled IEP1,777,500. The other 7 cheques represent 0.33%, by value of total third party lodgements. Of the 131 foreign currency cheques only 8, with a total value equivalent to IEP210,120 originated from Irish banks. This represents 3% by value of total third party lodgements. C 3i TB 3rd Party Chqs 200302 Page 1 o f 1 ANALYSIS OF ANSBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 LODGEMENTS BY SOURCE No. Transfers and Bank Drafts Payable to Ansbacher/IIB from Banks and Third Parties No. o f which Irish Bank Originated Guinness & Mahon Foreign Bank Originated 433 N ote Value (IEP Million) 30 5.15 32* 9.57 371 72.32 * 13 of these lodgements totalling IEP7.1 million occurred in 1991 Note: 4 of the 30 lodgements are Irish Pounds Value IEP (Million) 87.04 ) ) P li ANALYSIS OF ANSBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 DEBIT ENTRIES (I.E. MOVEMENTS OUT OF ACCOUNTS) Ansbacher Debit Entries (excluding inter account) Total IIB Debit Entries 1991 1992 1993 1994 1995 1996 1997 Total No. 322 369 437 299 203 182 85 1,897 64,000 66,000 74,000 78,000 79,000 80,000 67,000 507,000 P 2i ANALYSIS OF AN SBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 WITHDRAWALS (DEBIT ENTRIES) BY VALUE Value IEP (Millions) Value Irish Pound Withdrawals 8.0 8.3 Foreign Currency Withdrawals 88.1 91.7 Total Withdrawals 2L I I2Q % ANALYSIS OF ANSBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 ANALYSIS OF WITHDRAWALS BY PAYEE TYPE Number % Value IEP (Millions) % Irish Pound Withdrawals: to Banks 343 39.8 2.72 33.87 to Companies 474 55.1 4.79 59.65 5 0.6 0.08 1.0 39 4.5 0.44 5.48 861 100 8.03 100 to Individuals (transfers) to Individuals (cheques & drafts) Total ANALYSIS OF AN SBACHER/HAMILTON ROSS TRANSACTIONS 1991 TO 1997 ANALYSIS OF IRISH POUND WITHDRAWALS TO COMPANIES Number % Amount IEP % Kentford Securities Ltd. 138 29 0.45 9.4 BEL Secretarial 114 24 2.30 48.0 83 18 0.13 2.7 Other (Office Services etc) 139 29 1.91 39.9 Total 474 100 4.79 100 Credit Card Companies ANALYSIS OF AN SBACHER/HAMELTON ROSS TRANSACTIONS 1991 TO 1997 ANALYSIS OF PAYMENTS Payments where Payees were Individuals Irish Pound Transfers Cheques/Drafts Foreign Currency Transfers Cheques/Drafts Total Other Transfers Cheques/Drafts TOTAL No. % Amount IEP (Million) % 5 0.3 0.08 0.1 39 2.0 0.44 0.5 122 6.4 7.63 7.9 164 M 2.00 11 330 17.3 10.15 10.6 350 18.45 74.95 78.0 1,217 64.25 11.01 11.4 M £2 100% 96.11 100% Appendix XIV Order of the High Court of 13 March 2001 of Johnson J. "Appendix ?1 Tuesday the 13th day of March 2001 BEFORE MR JUSTICE JOHNSON IN THE MATTER OF THE COMPANIES ACTS 1963-1990 AND IN THE MATTER OF PART 2 OF THE COMPANIES ACT 1990 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (FORMERLY GUINNESS & MAHON CAYMAN TRUST LIMITED ANSBACHER LIMITED AND CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) AND IN THE MATTER OF AN APPLICATION PURSUANT TO SECTION 7(4) OF THE COMPANIES ACT 1990 Upon the application of Counsel for Noreen Mackey one of the three inspectors appointed by the Order herein dated the 22nd day of September 1999 to investigate the affair of Ansbacher (Cayman) Limited made ex parte to the Court on this day Counsel for the Minister for Enterprise Trade and Employment also present And on the application of Counsel for the inspectors IT IS ORDERED that application be heard in camera On reading the said Order dated the 22nd day of September 1999 and the Order dated the 8th day of December 2000 whereby pursuant to Section 8 of the Companies Act 1990 the persons named hereunder were appointed inter alia as inspectors to investigate the affairs of Ansbacher (Cayman) Limited (formerly Guinness & Mahon Cayman Trust Limited Ansbacher Limited and Cayman International Bank and Trust Company Limited) (a) His Honour Judge Sean O’Leary (b) Ms Noreen P Mackey Barrister-at-Law (c) Paul F Rowan Chartered Accountant and (d) Michael Cush Senior Counsel and on reading the Affidavit of the said Noreen Mackey made on her own behalf and on behalf of and with the authority of her fellow inspectors and filed in Court on this day By Consent IT IS ORDERED that in discharging their obligations on foot of the said Order of the 22nd day of September 1999 the Inspectors are required to investigate and report upon the clients of Ansbacher only in so far as it is necessary to do so for the purpose of examining and defining the nature and extent of Ansbachers Irish business from 1971 to the 22nd day of September 1999 for the purpose of identifying the clients of the company and for the purpose of examining the affairs of Ansbacher Reserving the costs of this application and Order Mary Cummins Solicitor ( O i K ^IO ) RE:IN THE MATTER OF THE COMPANIES ACTS 1963-1990 AND IN THE MATTER OF PART 2 OF THE COMPANIES ACT 1990 AND IN THE MATTER OF ANSBACHER ( CAYMAN) LIMITED Nature of Document:ORDER Entering Fee:TWO Solicitor:- MARY CUMMINS Address Pages THE HIGH COURT IN T H E M A TTER OF T H E C O M P A N IE S A C T S 1963 to 1990 AND IN THE M ATTER OF PA R T II OF TH E CO M PAN IES A C T 1990 AND SECTIONS 8 AND 17 AN D IN T H E M A TTER O F A N SB A C H ER (CAYM A N) LIM ITED (formerly GUINNESS M A H O N CAYM AN TR U ST LIM ITED, A N SB A C H ER LIM ITED and CAYM AN IN T E R N A T IO N A L BANK A N D TR U ST COM PANY LIM ITED ) R A A eport of t h e p p o i n t e d to f f a ir s o f A E Inspec to r s n q u i r e in t o t h e n sba c h er (C a y m a n ) L im it e d Published by Order o f the Court made on 24 June 2002 V o lu m e [2 ]: A p p e n d ic e s I t o X I V ISBN 0?7557?1355?9 Government of Ireland 2002 THE HIGH COURT IN T H E M A TTER OF T H E C O M P A N IE S A C T S 1963 to 1990 AND IN THE M ATTER OF PA R T II OF TH E CO M PAN IES A C T 1990 AND SECTIONS 8 AND 17 AN D IN T H E M A TTER O F A N SB A C H ER (CAYM A N) LIM ITED (formerly GUINNESS M A H O N CAYM AN TR U ST LIM ITED, A N SB A C H ER LIM ITED and CAYM AN IN T E R N A T IO N A L BANK A N D TR U ST COM PANY LIM ITED ) R A A eport of t h e p p o i n t e d to f f a ir s o f A E Inspec to r s n q u i r e in t o t h e n sba c h er (C a y m a n ) L im it e d Published by Order o f the Court made on 24 June 2002 V o lu m e [3 ]: A p p e n d ix X V (1 ) to X V (1 6 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (1) Mr Roger P Ballagh 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Roger P Ballagh. a) Transcript of evidence of Mr Michael O’Shea dated 19 June 2001. b) Statement of Michael O’Shea. c) Letter of 16 March 2001 - Michael O’Shea to the Inspectors. d) Internal Guinness and Mahon memo - JDT to P O’D of 5 September 1984. e) Letter of 2 May 1985 - DJ Barry to the Greffer’s Office, Guernsey. f) Letter of 18 May 1992 - Joan Williams to Ronan Redmond, IIB. g) Statements of Account A/A54. h) Foreign Dealing tickets - Hamilton Ross. Correspondence received from or on behalf of Mr Roger Ballagh. a) Letter of 14 December 2001 - Mason Hayes & Curran to the Inspectors. b) Letter of 15 January 2002 - Mason Hayes & Curran to the Inspectors. 9 . .- anywv? 2:65;: I (L UNDER OATH ON TUESDAY, 19TH JUNE 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: HIS HONOUR JUDGE 0 LEARY MS. MACKEY BL Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MR. MICHAEL O'SHEA Represented by: MR. KEVIN BARRY McGONAGLE KENNEDY BALLAGH WITNESS MR. M. I EXAMINATION JUDGE PAGE 48 1 THE EXAMINATION COMMENCED, AS FOLLOWS, ON TUESDAY, 2 19TH JUNE 2001: 3 4 5 JUDGE O'LEARY: I note your statement 6 with regard to the 7 voluntariness of your attendance and that is 8 accepted, Exhibit 1. 9 MR. O'SHEA: That is accepted. 10 JUDGE O'LEARY: By the Inspectors. 11 MR. O'SHEA: Thank you. 12 JUDGE O'LEARY: Yes. 13 Thanks. That is a fairly standard procedure 14 nowadays I think. 15 MR. O'SHEA: It is 16 JUDGE O'LEARY: It is indeed. 17 MR. O'SHEA: It is, yes. 18 JUDGE O'LEARY: Thank you very much indeed for attending, Mr. O'Shea. 19 20 My name is Sean O'Leary. 21 Inspectors. 22 pleasure of meeting before. 23 is the other Inspector. 24 MR. O'SHEA: I do not think we have had the 25 26 I am one of the Ms. Noreen Mackey I have met Ms. Mackey before. JUDGE O'LEARY: 27 You have met Ms. Mackey before. 28 MR. O'SHEA: Yes. 29 JUDGE O'LEARY: Yes, I think she told me 1 2 3 JUDGE O'LEARY: 4 The position is that there are, as you know, four 5 Inspectors but only two of the Inspectors will 6 be dealing with any matter touching on anything 7 we talk about here today to you. 8 MR. O'SHEA: Yes. 9 JUDGE O'LEARY: Obviously, we have had to 10 divide up the work and 11 that is the way it is divided so far. 12 MR. O'SHEA: I understand, yes. 13 JUDGE O'LEARY: The position is that we 14 have a number of questions 15 to ask you both in your own personal capacity as a 16 member of a firm of solicitors and also in your 17 capacity as one of the persons named with legal 18 authority in the Will of the late Mr. McGonagle. 19 MR. O'SHEA: Indeed. 20 JUDGE O'LEARY: Yes. 21 So, it is in those two capacities. 22 MR. O'SHEA: Yes. 23 JUDGE O'LEARY: It is a very informal 24 procedure. There is only 25 one formal part of it as you know and that is the 26 question of taking the oath. 27 MR. O'SHEA: Yes. 28 JUDGE O'LEARY: That is the only formal 29 part of it really. 1 2 JUDGE O'LEARY: I note that you have a 3 solicitor here with you. 4 You probably will not need it but if you feel like 5 consulting with the solicitor at any time by all 6 means just tell us "Stop" and we will stop and you 7 can of course consult with your colleague. 8 MR. O'SHEA: Yes. 9 JUDGE O'LEARY: And similarly if your 10 colleague feels that it 11 is in your interest that we should stop at any time 12 all he has to do is to say "Stop" and we will allow 13 the interruption. 14 MR. O'SHEA: That is why Kevin is here. 15 JUDGE O'LEARY: What? 16 MR. O'SHEA: That is why he is here. 17 JUDGE O'LEARY: That is why he is here, 18 yes. I think you are 19 wise. 20 pair of eyes and ears there. 21 MR. O'SHEA: Right, yes. 22 JUDGE O'LEARY: I wonder if you would take People are wise always to have another 23 the oath now and we will 24 get on to asking you the questions we have. 25 MR. O'SHEA: 26 27 28 29 Yes. 1 MR. MICHAEL O'SHEA, HAVING BEEN SWORN, WAS EXAMINED 2 AS FOLLOWS BY JUDGE O'LEARY: 3 4 5 1 Q. JUDGE O'LEARY: 6 Mr. O'Shea, the position is that most of the 7 connections which we have discovered relate, I 8 would think it is fair to say, to the activities 9 of the late Mr. McGonagle? 10 A. 11 2 Q. Yes. I think that is a fair summary. There are however 12 a number of things relating to your firm to which 13 we would also like to refer? 14 A. 15 3 Q. Yes. However, in order to put the matter straight you 16 were appointed under the Will of Mr. O'Shea to be 17 the Executor and Trustee of his Estate? 18 A. Of Mr. McGonagle. MS. MACKEY: 19 20 A. 21 4 Q. Mr. McGonagle. Yes . JUDGE O'LEARY: 22 Of Mr. McGonagle I should say? 23 A. Yes, I was. 24 Q. You were? 25 A. One of them. 26 Q. Yes. 27 A. That is right. 28 Q. Yes. 29 A. 0'Reilly-Hyland. One of two of them I think? The other one being a Mr. 0'Reilly-Hyland? 1 8 Q. 2 A. No. 3 9 Q. No? 4 A. No, I renounced my rights. 5 10 Q. You renounced your rights? 6 A. 7 11 Q. 8 A. His widow. 9 12 Q. His widow? 10 A. 11 13 Q. 12 A. 13 14 Q. 14 A. 15 15 Q. 16 A. 17 16 Q. 18 A. 19 17 Q. Did you exercise that power? Yes. Who in fact exercised the power? Barbara. Yes. As the heir at law is it? As the residual legatee. As a residual legatee? Yes. All right. Did you act in that matter? Yes. Yes, you did. In a professional capacity for him? Yes. One of the problems that we have had in dealing 20 with the case of Mr. McGonagle is that we have to 21 accept that the widow of Mr. McGonagle was only 22 very recently married to him? 23 A. 24 18 Q. That is true, yes. And she has sent us in various statements with 25 regard to her state of knowledge which we accept; 26 I mean from a practical viewpoint? 27 A. 28 19 Q. 29 A. Indeed. You are probably aware of those statements yourself? Yes, I am. 1 20 Q. 2 A. 3 21 Q. 4 A. 6 22 Q. 7 A. 8 23 Q. 9 A. 10 2 4 Q. 11 I mean from your own personal knowledge are we Well, I would have thought so. Yes? I mean she...(INTERJECTION). You...(INTERJECTION)? I mean...(INTERJECTION). From your own knowledge does she know anything about the situation? A. Well, I can never be certain but I know...(INTERJECTION). 13 14 25 Q. 15 A. 16 Of course I understand that? But I know Liam was an extraordinarily close, careful, prudent and secretive man. 17 26 Q. 18 A. 19 27 Q. 20 A. 21 28 Q. 22 A. 23 24 I am aware of them. wise to give credence to those do you think? 5 12 Yes? Yes? He didn't volunteer information to anybody. Yes? And least of all to his wife. Yes? Now, I mean I gleaned information over the years from time to time. 29 Q. 25 I understand. I was never told, you know? So, it is entirely consistent that she would not know anything really significant? 26 A. 27 30 Q. 28 A. 29 31 Q. It certainly is, yes. All right. We actually accept that? Yes. And we will of course reflect that in any decision 1 which we have to take; of course. 2 us in somewhat of a difficulty because it would 3 be not unfair to the late Mr. McGonagle to say that 4 his name crops up on a number of occasions through 5 the course of our investigation? 6 A. 7 32 Q. 8 A. 9 33 Q. 10 A. I haven't seen...(INTERJECTION). 11 34 Q. You have not seen it; all right? 12 A. 13 35 Q. That however puts Yes. Both as a solicitor and as an individual? Yes. I think that...(INTERJECTION)? I have seen some. All right. The problem which we are faced with is: 14 We must identify the clients of the Company we are 15 investigating? 16 A. 17 36 Q. 18 A. 19 37 Q. 20 A. 21 38 Q. 22 A. 23 39 Q. 24 A. 25 40 Q. 26 A. 27 41 Q. 28 29 Yes. Which is "Ansbacher"? Yes. We are not investigating Mr. McGonagle? Yes. We are not investigating you? Yes. We are not investigating anybody? Yes. We were investigating the Company? Yes. However, one of the jobs that has been given to us is that we must identify the clients of the Company. A. Right, yes, yes. 1 42 Q. 2 was a client of "Ansbacher" or not? 3 A. 4 43 Q. 5 A. 7 44 Q. 8 A. 9 Do you know whether he was or not; directly or He never told me. Yes? But I did obviously advise him in a number of respects in connection with a visit to a Tribunal 10 and...(INTERJECTION). 11 45 Q. 12 A. 13 46 Q. 14 A. I do not want t o ...(INTERJECTION)? And also...(INTERJECTION). I do not want t o ...(INTERJECTION)? I also advised him. So, I am not sure if I can answer that. 15 47 Q. 17 I do not want any information which you got exclusively from giving him advice? 18 A. 19 48 Q. 20 A. 21 4 9 Q. 22 Yes. I do not want that information? Yes. That would be improper and I do not want that information? 23 A. 24 50 Q. 25 Yes. Other than that are you aware of any such connection? 26 A. 27 51 Q. 28 29 Yes. indirectly? 6 16 Obviously, we have to consider whether Mr. McGonagle He would never have told me. Yes, yes. Do you know for example of the existence of a company called Camille Investments Ltd? A. Yes, I have heard the name. 1 52 Q. 2 3 Yes. Had you any connection yourself with the Company? A. 4 No, no, but I knew it was an investment company of Liam's. 5 53 Q. 6 A. 7 54 Q. 8 A. 9 55 Q. Of Liam's? Yes. Did he own it himself? He did. He did, yes, yes. It may have been, the shares may 10 have been, in different person's names from time to 11 time but I think he was the beneficial owner at all 12 times ? 13 A. 14 56 Q. 15 A. 16 57 Q. 17 A. 18 58 Q. 19 A. 20 59 Q. 21 I would have thought so, yes. Yes? I don't think they were in anybody else's name. They may? But I may...(INTERJECTION). They may have been but...(INTERJECTION)? I mean I wouldn't necessarily know. Yes, yes. I will just show you a letter of the 30th March 1988, Exhibit 2? 22 A. 23 60 Q. 24 Yes. Which I think is Mr. McGonagle's own acknowledgement that he owns the Company? 25 A. 26 61 Q. Right, yes. Because obviously unless we know who owned the 27 Company we could not proceed on any basis 28 (Same Handed), Exhibit 3? 29 A. Yes, right. Yes, that seems clear. 1 62 Q. 2 A. 3 63 Q. 4 It seems clear enough? Yes, it does, yes. And I mean I am just giving you an opportunity of looking at it? 5 A. 6 64 Q. 7 Yes, yes. In case you say, "That is all wrong. He only did that because of X, Y or Z"? 8 A. 9 65 Q. No. All right. There are two other pieces of evidence 10 which I want to put to you as a person who might 11 know something about it? 12 A. 13 66 Q. 14 Yes, yes. And, of course, I accept you might not also know anything about it as well? 15 A. 16 67 Q. Yes. However, I think in fairness to the late 17 Mr. McGonagle somebody had better be told about 18 these pieces of information because otherwise 19 it would be quite improper and I think you are 20 the appropriate person. 21 memo dated the 16th August 1978. 22 is "internal" it is internal to Guinness Mahon 23 Ireland (Same Handed)? 24 A. 25 68 Q. 26 When I say it Yes, yes. You may have already seen that in another context. I am not sure whether you have or not? 27 A. 28 69 Q. 29 There is an internal I probably have seen this before. You probably have seen it? 1 70 Q. There are three matters that I want to point out 2 to you there. 3 Mr. Turvey is to me? 4 5 A. 71 Q . 6 A. 7 72 Q. 8 A. 9 73 Q. 10 A. 11 74 Q . 12 A. 13 75 Q. 14 15 Mr. Turvey: Would you explain who He is a friend of Liam McGonagle's. Yes ? Was a friend, yes. Yes. Is he an accountant or is h e ...(INTERJECTION)? He is an accountant; he is. Is he? Yes. Yes? Though he has't ...(INTERJECTION). Has he a Haughey Boland background or...(INTERJECTION)? A. No, he hasn't. He has always -- I don't think he 16 has ever practised as a professional accountant. 17 He has always been in business. 18 76 Q. 19 A. 20 21 And -- but he was a friend of Liam's since -- from his school days. 77 Q. 22 Yes. He seemed to have carriage of a lot of matters relating to Camille Investments Ltd over the years? 23 A. 24 78 Q. 25 A. 26 79 Q. 27 A. 28 80 Q. 29 Yes? They were very friendly. Do you know that of your own knowledge? Well, they were friendly, you know? Yes? And...(INTERJECTION). However, do you know whether he had a lot of 1 A. 2 I think Liam would have relied on him from time to time, yes. 3 81 Q. 4 A. 5 82 Q. Yes? 6 A. Yes. 7 83 Q. 8 From time to time? Yes. There are two other matters I want to refer to you: Do you see the expression: 9 10 "This is a suitably secured situation"? 11 12 A. 13 84 Q. Yes. We have been informed by Guinness & Mahon that 14 "suitably secured" in that context means the 15 following: 16 it was being borrowed on a back-to-back basis 17 against money which was on deposit outside this 18 jurisdiction. 19 Ireland. 20 A. 21 85 Q. 22 A. 23 86 Q. 24 That may have been the North of It may have been the Channel Islands? Yes. Or it may have been the Cayman Islands? Yes. Do you know whether Camille Investments had any such money of your own knowledge? 25 A. 26 87 Q. 27 A. I would be very surprised if it had. Yes? I would be -- Camille Investments was an Irish company. 28 29 That money was being borrowed and 88 Q. Yes? 1 A. 2 So, I don't think Camille would have had any funds outside of the jurisdiction. 3 89 Q. 4 A. 5 90 Q. 6 A. 7 91 Q. Yes? But again I can't be certain. Yes, I understand? But I would be very surprised. If it was being backed by funds outside the 8 jurisdiction they were probably held in another 9 name? 10 A. 11 92 Q. 12 That's a possibility. Yes. Because you can see in the bottom that it says : 13 14 "In the meantime I have asked E.McL. to hold dollars in excess of 300,000.00 held on deposit from G.M.C.T to our order." 15 16 17 18 A. 19 93 Q. Yes. One of the conclusions the Inspectors might draw 20 from that and of course they can be persuaded to 21 draw a different conclusion if that is appropriate? 22 A. 23 94 Q. Yes, yes. One of the conclusions they might draw from it is 24 that Camille Investments and its owner had access 25 to backing deposits in Guinness Mahon Cayman Trust, 26 which was an earlier name of "Ansbacher". 27 have any information to confirm or dissuade us from 28 adopting that course of action? 29 A. Do you I would be I suppose giving privileged information 1 2 95 Q 3 I am not interested in the privileged information. Other than privileged information...(INTERJECTION)? 4 A 5 96 Q 6 A 7 97 Q 8 A 9 98 Q 10 A 11 I am...(INTERJECTION). You can forget you know privileged information? I am...(INTERJECTION). Forget that? I ...(INTERJECTION). You do not know? I know I have come across the phrase "suitably secured" on many occasions. 12 99 Q 13 A 14 100 Q 15 A Yes ? I know how Guinness & Mahon interpret that phrase. Yes? I am not sure that it was always interpreted -­ 16 it always reflected the actual position. 17 come across situations where I think it might have 18 been convenient for Mr. Traynor to say to his 19 lending committee, 20 101 Q 21 A Yes, I understand. I have "This is adequately secured". Yes? Whereas in fact it wasn't but he would have known 22 the borrower and would have been quite happy. 23 I cannot give you any instances off the top of my 24 head of that but I certainly have come across one 25 or two instances of that. 26 102 Q Yes. Now, However, Mr. O'Shea, that line of "Defence" 27 hardly passes muster in this case when in the course 28 of the same memo there is a specific request? 29 A 1 103 Q 2 To set aside 300,000 US dollars, presumably US dollars, which are apparently in G.M.C.T? 3 A 4 104 Q 5 Indeed. So, I think that "Defence" which might be open to some people hardly applies to this document? 6 A 7 105 Q 8 Right, indeed. You see the point I am making; that is all I am saying? 9 A 10 106 Q I see the point you are making of course. All right, grand. The third piece of evidence 11 that we have which would indicate a connection 12 between Camille Investments Ltd and "Ansbacher", 13 and therefore of course indirectly with 14 Mr. McGonagle, is a memo dated or a letter dated 15 the 11th March 1990 from Mr. Lanigan-0'Keeffe to 16 Mr. Traynor and there is a Schedule attached to 17 that. 18 Mr. O'Shea, I am treating you as a solicitor in 19 this regard: I am going to give you the complete 20 document which includes the names of other people 21 (Same Handed), Exhibit 4? 22 A 23 107 Q 24 Certainly, you can take that...(INTERJECTION). However, I mean you have to undertake to me not to...(INTERJECTION)? 25 A 26 108 Q 27 A 28 109 Q 29 I think in the case of Mr. O'Shea you can -­ Yes . To abide by confidence in that regard? Yes, yes. Mr. Lanigan-0'Keeffe has informed another person, and will in due course no doubt inform us also, 1 that this Schedule was produced by him for 2 Mr. Traynor and it was a Schedule of "suitably 3 secured" loans? 4 A 5 110 Q 6 Yes . Persons who had loans through "Ansbacher" that were "suitably secured"? 7 A 8 111 Q 9 Yes, yes. And they included a number of persons including Liam McGonagle? 10 A 11 112 Q 12 A 13 113 Q 14 A 15 114 Q 16 A Yes, yes. All right? Yes, clearly the case, yes. Yes? Yes . Have you any comment to make on that? It could be for a number of factors. I can't -­ 17 obviously it would be speculation -- I think you 18 can speculate; I think may be correctly. 19 seen a number of these (indicating), Exhibit 4. 20 115 Q 21 A 22 116 Q 23 A 24 117 Q 25 A 26 118 Q 27 A 28 119 Q 29 I have I can only go on what Mr. Lanigan-0'Keeffe says? Yes . That is all I can go on? Yes . Because I ...(INTERJECTION)? Yes . It means nothing to me. All it is is a Schedule? Yes, yes. If Mr. Lanigan-0'Keeffe said to me, which I anticipate he will not because he has said it 1 differently to another person, but if he in due 2 course says to me, "Well, I don't know what 3 that list is"? 4 5 120 Q. 6 Well, then I will have to take it to out of my reckoning; do you understand? 7 A. 8 121 Q. 9 Yes. However, if he says what I anticipate he is going to say? 10 A. 11 122 Q. Yes, yes. There can be only one conclusion surely; that 12 conclusion is that Mr. Lanigan-0'Keeffe 13 thought that...(INTERJECTION)? 14 A. 15 123 Q. 16 A. 17 124 Q. 18 19 That these were...(INTERJECTION). That Mr. McGonagle had a "suitably secured" loan? Indeed, yes. Whether that proves it or not; that is a matter of judgment afterwards? A. 20 This was a list of facilities made available by Guinness & Mahon to the individuals. 21 125 Q. 22 A. 23 126 Q. 24 A. 25 127 Q. 26 A. 27 128 Q. With backing? With...(INTERJECTION). To "Ansbacher"? Yes. As you will appreciate...(INTERJECTION)? Yes. As you will appreciate if you look at the date, 28 the 11th May 1990, it can hardly be anything else? 29 MR. BARRY: That is a question you 1 are asking, Michael, or 2 is that a statement you are making? 3 Well, I am...(INTERJECTION). 4 MR. BARRY: Are you saying that that is a list (indicating), 5 6 Exhibit 4? 7 A 8 129 Q 9 A 10 11 I am assuming it is a list. JUDGE O'LEARY: A 14 So, it is a question? Yes, right. Yes . M R . BARRY: It sounded like a statement; sorry. 15 16 It is a list? Yes . M R . BARRY: A Yes. It is a list, yes. M R . BARRY: 12 13 Well, no. A 17 Yes . JUDGE O'LEARY: I think coaching the witness is neither 18 19 ethical. 20 M R . BARRY: Excuse me; I am sorry. 21 JUDGE O'LEARY: Or certainly necessary. 22 M R . BARRY: Excuse me. 23 JUDGE O'LEARY: With an expert witness like this. 24 25 26 130 Q M R . BARRY: Sorry. JUDGE O'LEARY: However, the reality of the situation as you 27 28 29 will appreciate? A Yes. 1 131 Q 2 longer had any connection with Guinness & Mahon? 3 A 4 132 Q 5 That is right. And he is addressed in the letter as being Mr. J. D. Traynor of "Ansbacher" Limited? 6 A 7 133 Q 8 Yes . So, we can take it that it has an "Ansbacher" connection? 9 A 10 134 Q 11 12 Is that on the 11th May 1990 Mr. Traynor no I ...(INTERJECTION). We can take it that Mr. Lanigan-0'Keeffe thought it had an "Ansbacher" connection? A 13 Thought -- well, perhaps he did, yes. Perhaps he did. 14 135 Q 15 A Yes. That is a matter that...(INTERJECTION)? Now, I know from talking to Liam that Liam had 16 always had the assets of Camille securing any 17 borrowings he had personally. 18 136 Q 19 A 20 Yes ? And including also the Deeds to No. 29 Molesworth Street. 21 137 Q 22 A 23 All right? And insofar as Liam was concerned that was security that they held. 24 138 Q 25 A Yes, I understand that? And if there was anything in "Ansbacher" it wasn't necessary. 26 27 139 Q 28 A 29 140 Q That may well be the case? Now...(INTERJECTION). However, we have found many examples of that? 1 2 141 Q 3 A But certainly No. 29 Molesworth Street -- I am 4 not sure had it been sold at that time or not but 5 it was substantially more than the borrowing than 6 was there 7 figure there (indicating), Exhibit 4, and I think 8 also the other assets of Camille would have been in 9 the region of a few hundred thousand pounds. (indicating), Exhibit 4, or the borrowing They 10 were basically investments and again they would have 11 been there as security. 12 or what other records Guinness & Mahon might have 13 in relation to that type of security. 14 142 Q 15 A So, I don't know what else Yes? And whether they would have considered that to 16 be adequately secured or not but I mean I hear 17 what you are saying, yes. 18 143 Q 19 You can take it that their evidence to us has been that adequately secured means offshore? 20 A 21 144 Q 22 A 23 145 Q 24 A 25 146 Q Yes, offshore, yes, yes. It does not necessarily mean Cayman? Yes . However, it means offshore? Yes, yes. All right. The last thing I want to show you in 26 the Camille mode of this is a document signed by 27 yourself apparently (Same Handed). 28 signature (indicating), Exhibit 5? 29 It is, yes. Yes, it is. Is that your 1 147 Q 2 A 3 148 Q 4 I have no idea. Whose signature is it underneath? There appear to be two signatures on it? 5 A Yes. That is Des Turvey's signature. 6 149 Q Yes. That is the one which we have seen in many 7 documents dealing with Camille? 8 A 9 150 Q 10 And we will of course in due course deal with that with Mr. Turvey? 11 A 12 151 Q 13 A 14 And that is Mr. Turvey. Who were not the auditors? No. I haven't seen the Company's file. Was I a Director at some stage of Camille? 15 152 Q 16 A 17 153 Q 18 A 19 154 Q 20 A 21 155 Q 22 23 Yes . I do not know? Yes . I am asking you? I honestly...(INTERJECTION). You told me you had nothing to do with the Company. I have...(INTERJECTION). And I am just saying to you that I have come across this document A 24 (indicating), Exhibit 5? I have no idea what -- why my signature is there (indicating), Exhibit 5. 25 156 Q 26 A 27 157 Q 28 A 29 158 Q I wonder if you would have a look at it yourself? Yes . And if you can come up with any explanation? Yes . That would be of assistance to us? 1 2 159 Q 3 A Yes. It is clearly a request to the bank to provide 4 information to Haughey Boland but I cannot tell you 5 in what capacity I signed that 6 Exhibit 5. 7 160 Q 8 Do you see that the document itself says you signed as an authorised signature? 9 A 10 161 Q 11 A 12 162 Q 13 Yes . Were you an authorised signature for that Company? I don't believe so. Yes. I have come across no information that you in fact were an authorised signature of the Company? 14 A 15 163 Q 16 A 17 164 Q 18 19 (indicating), Yes . However, I wonder would you look at it? Yes . And see whether there is any further information you can give us as a result of your investigations? A I will certainly check to see was I a Director at that stage. 20 21 165 Q 22 A 23 16 6 Q 24 A 25 167 Q 26 Exactly? Yes . I wonder would you do that? Yes, yes. I think it would be of assistance to us if you did that? 27 A 28 168 Q 29 A Certainly, yes. All right? 1 Thank you. 2 Mr. McGonagle's involvement in any other 3 companies with "Ansbacher" connections other 4 than in a . ..(INTERJECTION)? 5 A 6 170 Q 7 A 8 Professional? Yes; professional capacity? I don't think so. Other than in a professional capacity, no. 9 171 Q 10 A 11 172 Q 12 A 13 173 Q 14 A 15 174 Q 16 A No. 17 175 Q No? 18 A 19 176 Q Yes. I am not interested...(INTERJECTION)? Not that I -­ Yes ? I mean a number of companies have come up certainly. Yes? If you...(INTERJECTION). Was he involved in a company called Pine Securities? He wasn't. Was he involved in a company called Beresford Investments ? 20 21 A 22 177 Q 23 24 Do you know anything about I believe he was. Yes. Were you involved in the Company called Beresford Investments? A No, but I remember it through the office. I 25 think it bought and sold a property and I think 26 lost a small amount of money in the process. 27 178 Q 28 29 Yes. Do you know who the beneficial owners of that Company were? A I think there were a number of individuals. 1 2 A. 3 180 Q. 4 A. 5 181 Q. Including, yes. Yes. Were you a beneficial owner of the Company? No. That also, according to the records of GMI and 6 that is all I am talking about is the records 7 of GMI? 8 A. 9 182 Q. 10 A. 11 183 Q. 12 A. 13 184 Q. Yes. Had a "suitably secured" loan? Yes, I have seen those. You have seen those? Yes. I have no knowledge as to what that "suitably 14 secured" loan was. 15 as I have in the case of the previous one that I put 16 to you; do you understand? 17 A. 18 185 Q. 19 I do not have the same knowledge Yes. Yes. Were you familiar with a company called British Isle Investments? 20 A. 21 186 Q. 22 A. 23 187 Q. 24 A. 25 188 Q. 26 A. 27 I have heard the name. Yes. Were you an owner of that Company yourself? No. Had you any interest in the Company? None, none. Did Mr. McGonagle have an interest in the Company? That would be again information I would have gleaned from Mr. McGonagle. 28 189 Q. 29 A. In a professional capacity? In a professional capacity, yes. 1 190 Q. 2 A. 3 191 Q. 4 A. 5 192 Q. 6 Other than that I wouldn't know. You would not know? No, I wouldn't know. However, British Isle Investments Company or whatever the precise name of it was? 7 A. 8 193 Q. 9 A. 10 194 Q. 11 A. 12 195 Q. 13 A. 14 Yes. Was a very famous Company? Yes. I mean it had been the subject of much speculation? Indeed. I think I ...(INTERJECTION). So, I mean it is not just like a . ..(INTERJECTION)? I think I -- yes, I think I know what you are referring to. 15 196 Q. 16 A. 17 197 Q. 18 A. 19 198 Q. Yes. In the United Kingdom? That is right, yes. There was a company investigation? There was. And British Isle Investments was at the very centre of that company investigation? 20 21 A. 22 199 Q. 23 24 However, other than that information? Yes, that is right. Surely at that time quite separate from any advice which you gave him in later life...(INTERJECTION)? A. 25 Well, I remember a little bit about that. There were two UK -­ 26 200 Q. 27 A. Yes? There were two British property developers that 28 Liam had a business relationship with. We -- I 29 think they were involved in a US public -- sorry, 1 a UK company called Norwest Holst Ltd and I think 2 it was in that context that the inquiry arose but 3 I didn't know -- I never knew the details of the 4 inquiry. 5 201 Q 6 7 I can assure you I have no interest in the details of the inquiry? A I know there was a suggestion that in some way 8 they had taken money out of Norwest Holst and -­ 9 but I never knew the...(INTERJECTION). 10 202 Q However, was not the fact of Mr. McGonagle and 11 this British Isle Investments Company central 12 to the issue to be deciding in that inquiry 13 in England and did they not come to Dublin to 14 interview Mr. McGonagle? 15 A 16 I wasn't aware of that. I thought he hadn't been interviewed but...(INTERJECTION). 17 203 Q 18 A 19 204 Q No, he had not? Yes . Because when they came to Dublin he refused to be interviewed? 20 21 A 22 205 Q 23 A I see, I see. All right. However, you surely must have known that? It is just that I have heard the name but whether 24 it was a company that was solely controlled by 25 these two English property developers or with 26 Liam McGonagle I don't know. 27 206 Q 28 A 29 Yes? It -- I am not sure what the results of the inquiry were either but the...(INTERJECTION). 1 207 Q. 2 3 Yes, I see. However, you do not know anything about that Company as such? A. 4 Other than in the context of professional advice, no. 5 208 Q. 6 A. 7 209 Q. 8 A. 9 210 Q. Yes? I mean I was aware vaguely of the inquiry. Yes? But I can't say I know anything about it. Yes. On the question of professional advice: 10 Ms. Cummins mentions to me, and it is quite true, 11 that the recent law on that matter seems to 12 differentiate between information which a solicitor 13 gets while acting for a Client with regard to who 14 owns a company on the one hand? 15 A. 16 211 Q. 17 Yes. And the advice that he or she tenders to that person arising from that consultation? 18 A. 19 212 Q. Yes. And that all seems to have come down in favour of a 20 solicitor not being able to exercise privilege with 21 regard to information with regard for example to the 22 ownership of a company? 23 A. 24 213 Q. 25 A. 26 Is that not the current state of the law? I thought it was -- I mean I bow to your knowledge in that regard, Judge. 27 214 Q. 28 A. 29 Well, I think they...(INTERJECTION). Yes? But I did look at Judge Kelly's decision in the Miley -v- Miley case and he clearly said there you 1 cannot -- you must disclose the name of your client. 2 215 Q 3 A Yes ? And he decided, or he confirmed I think the legal 4 position, that legal assistance isn't privileged. 5 Legal advice is, which I think is the sort of 6 language he used. 7 216 Q 8 Any way, Mr. O'Shea, I am not going down that road; I can assure you? 9 A 10 217 Q Yes . Because with regard to Mr. McGonagle I certainly 11 have enough information to be able to make a 12 decision whether or not he was a client of 13 "Ansbacher"? 14 A 15 218 Q Okay, indeed. I may be a bit deficient with regard to being 16 able to precisely define the extent to which he 17 was a client? 18 A 19 219 Q Okay, yes. However, I do not think that is sufficiently 20 important to my investigation of "Ansbacher" 21 for me to go to the scaffold over it? 22 A 23 220 Q 24 A 25 221 Q Indeed, yes. Do you understand what I mean? Indeed. If it was necessary and if it was a matter of 26 life or death I would pursue the matter further 27 with you but I am not interested in pursuing 28 the matter further with you at this stage for 29 that reason? 1 2 222 Q All right? 3 A Thank you. 4 223 Q 5 I come now to the question of the relationship between "Ansbacher" and your company? 6 A 7 224 Q 8 A 9 225 Q 10 A 11 226 Q Yes . A firm of solicitors? Yes . And we have received your statement in that regard? Yes . And it is helpful and thank you very much indeed 12 for the statement, Exhibit 6. 13 assistance to us. 14 for Cayman International Bank & Trust Company 15 Limited, which was another of the names of 16 "Ansbacher"? 17 A 18 227 Q It is of considerable We know that your company acted Yes . And really we are not interested in that. We 19 really have no concerns with regard to that. 20 You are entitled to act for those people if 21 you want. 22 1993 situation? 23 A 24 228 Q However, we are interested in the Yes . About this fee apparently that was paid by a UK 25 Client of the firm. 26 approximately? 27 A 28 229 Q 29 What was the amount of that I do not want the...(INTERJECTION)? Approximately £40,000. £40,000, yes. somewhere? Do you know how long it was invested 1 A 2 I would hazard a guess and say a number of months; may be up to five or six months perhaps. 3 230 Q 4 A 5 231 Q Yes ? May be shorter. Yes. If I was to tell you that our information is 6 that it was in Hamilton Ross rather than Kentford 7 would you know whether that is right or wrong? 8 A 9 232 Q 10 A 11 233 Q 12 I won't. Yes ? I know the payment came from Kentford. Yes. However, I think Kentford was merely a device used for making payments? 13 A 14 234 Q 15 A 16 235 Q 17 A 18 236 Q 19 A 20 237 Q 21 May be so, yes. Do you understand? May be so, yes. It was not an investment vehicle? Yes, yes. Insofar as we have been able to ascertain? Yes . Kentford was the mechanism by which money was paid to Irish people? 22 A 23 238 Q 24 Yes . From money which had been abroad; do you understand what I mean? 25 A 26 239 Q 27 A 28 240 Q 29 A Yes, I do, yes. Yes. That was...(INTERJECTION)? I do, yes. So, as far as you were concerned it was Kentford? Yes . 1 241 Q. Do you remember the circumstances in which it was 2 put where-ever it was put; leaving aside for the 3 moment where it was put? 4 A. 5 242 Q. 6 A. 7 243 Q. 8 A. 9 244 Q. 10 A. 11 245 Q. 12 A. 13 246 Q. 14 I think it was probably Liam's idea. Yes? To route it through Des Traynor. Yes? And Liam possibly mentioned it to me. Yes? In any event it happened. Yes? And subsequently payments were made by Kentford. Yes. Were you familiar at that time with where it was going yourself? 15 A. 16 247 Q. 17 A. 18 248 Q. No, I had no idea. You had no idea? I had no idea. When you say it was "Des Traynor" do you think 19 it was coming to Des Traynor in Ireland or it 20 was coming to Des Traynor where? 21 A. 22 24 9 Q. 23 A. Well... (INTERJECTION) . Or did you know? Obviously, I knew of Des1s connection with 24 Guinness & Mahon. 25 as to what other banking connections he had. 26 Obviously, at that time he was no longer in 27 Guinness & Mahon. 28 29 250 Q. I didn't give it any thought I mean he had left Guinness & Mahon at that stage for five years? 1 A That is true, that is true, but in any event he 2 was happy to facilitate Liam and did and I didn't 3 really think very much about it one way or the 4 other. 5 251 Q Yes. You are not familiar, are you, with whether 6 or not -- it was then eventually brought into this 7 Country. 8 was it, and distributed between you? 9 A 10 252 Q 11 The money was brought into this Country, It was distributed to the partners, it was. And where did it end up? Did it end up in the firm's account or where did it end up? 12 A 13 253 Q 14 A 15 254 Q 16 A 17 255 Q 18 A 19 256 Q No, it ended up in the partner's account. In...(INTERJECTION)? Individually. Within the firm? Individually. Individually? Yes, individually. Individually, yes, I see. Was it expected that the 20 partners would make whatever returns were necessary 21 arising out of that? 22 A Yes . 23 257 Q Yes ? 24 A 25 258 Q Yes ? 26 A Yes . 27 259 Q And was this money earned abroad or...(INTERJECTION)? 28 29 Well, if they were doing it, yes. A It was earned abroad. 1 260 Q 2 A 3 261 Q 4 Earned abroad? Yes, it was a UK Client as I recall. Yes, I see, I see. Do you remember the time of the year in 1993 that you received that money? 5 A 6 262 Q 7 A 8 263 Q 9 A 10 I don't remember. I wonder could you find that out for us? I could. Yes? Yes, I could. I think there may be some correspondence. 11 264 Q 12 A 13 265 Q 14 A 15 2 66 Q Yes. Well, that is fair enough? But I will certainly see if I can find that out. Yes. That would be of assistance to us? Yes . It always seems to us that there was a small balance 16 remaining in Hamilton Ross after the payment was 17 made even as late as the 31st December 1993 of 18 some £1,24 0? 19 A 20 I think there was. I think that may have been interest. 21 267 Q 22 A 23 268 Q At a later date? 24 A At a later date. 25 269 Q 26 Yes? Which was subsequently divided again. Yes. I wonder would you just give us the dates of those? 27 A 28 270 Q 29 A Certainly. It would be of considerable assistance to us? 1 271 Q 2 A 3 272 Q All right? Okay. Thank you very much indeed. That is grand. 4 Have I -- from time to time -- as you say in 5 your statement, Exhibit 6: 6 respected the firm and I am not concerned about 7 that November 1993 instruction that you received. 8 Had you ever acted for the Firm before that? 9 A 10 273 Q 11 A 12 274 Q 13 On one occasion you No, not to my knowledge. No, not to your knowledge? Yes . I see, okay. Had you ever received money from the Firm before that? 14 A 15 275 Q No. All right. We have, I have, two other documents 16 to show you. 17 its frailty to you because I do not like making 18 claims for documents that I cannot stand over, as 19 you will appreciate. 20 Ms. Cummins, please 21 A 22 276 Q 23 A 24 277 Q 25 This is a document at page 28, (Same Handed), Exhibit 7? Thanks. This is a memo from Mr. Traynor to Mr. O'Dwyer? Yes . They were both working in Guinness & Mahon at the time? 26 A 27 278 Q Yes . On the face of it it looks just like a Guinness & Mahon payment? 28 29 One really is and I want to explain A 1 279 Q. There are however if you like two aspects of 2 the matter which give rise to some possibility, 3 and I am not putting it any stronger than that, 4 of an "Ansbacher" connection. 5 that it was a sterling draft? 6 A. 7 280 Q. One is the fact Yes. Which was a little unusual if the money was 8 in Ireland in ordinary circumstances, and secondly 9 Redshank Investments. 10 11 Company? A. 12 13 Have you heard of that I have heard of that again in a professional capacity, yes. 281 Q. Yes. That Redshank Investments, the Inspectors 14 believe, had a connection with McGonagle. 15 Inspectors believe that? 16 A. 17 282 Q. 18 A. 19 283 Q. 20 The Yes. We are not asking you to confirm or deny that? Yes. And that it may well have had an "Ansbacher" connection? 21 A. 22 284 Q. 23 A. 24 285 Q. 25 A. Yes. Do you know anything about that payment? I have a vague memory I have to say. Yes? But only that. I can't say in what context it is. 26 The other people named were partners in the firm. 27 So, it may be in that context that this payment 28 was made but I cannot...(INTERJECTION). 29 286 Q. It is like as if it is a division of some money 1 between partners in the Firm with Mr. McGonagle's 2 section going to Redshanks? 3 A 4 287 Q 5 A 6 288 Q Indeed. Is that not what it looks like? Indeed. The source of that fund, of those funds, are a 7 cause of concern to us. 8 think about that? 9 A 10 289 Q 11 A 12 290 Q 13 A 14 291 Q 15 A 16 292 Q 17 A 18 293 Q 19 A 20 294 Q 21 A 22 295 Q I wonder would you I will, yes. And would you revert to us with regard to that? Yes, I will. I do not want t o ...(INTERJECTION)? I can't recall now. Yes, I understand? Yes . I understand that? Yes . However, it may be worth while thinking about it? Yes . All right? Certainly. The difficulty about this payment as far as we are 23 concerned is that it mentions you by name rather 24 than the Firm? 25 A 26 296 Q Indeed, yes. Of course we have to be very careful and we will 27 be very careful and certainly we will be very 28 careful in respect of any payment of £1,650? 29 A 1 297 Q 2 A 3 298 Q Which is not even in 1984 an amazing sum of money? Yes . However, at the same time we have to satisfy 4 ourselves that it does not have an "Ansbacher" 5 connection? 6 A 7 299 Q 8 A 9 300 Q Yes, indeed. So, any assistance you can give us in that regard? Fine, yes. Otherwise we may have to go and investigate it. 10 We have not really investigated it that much at 11 this stage? 12 A 13 301 Q 14 A 15 302 Q 16 A 17 303 Q 18 Yes, okay. However, if you can satisfy us so be it? Very well. We will just let it stand at that; all right? Certainly. All right. That is one -- you might come back to us on that, Mr. O'Shea? 19 A 20 304 Q Yes, I will. The other thing is this: I wonder would you just 21 show Mr. O'Shea number 29 as well 22 Exhibit 8? 23 Investments as being a Client of College Trustees. 24 You can take it that at that stage our information 25 is that College Trustees' funds, not necessarily all 26 of them but many of the College Trustees' funds 27 which they had invested for clients, were routed 28 for some inexplicable reason through "Ansbacher"? 29 Yes, I see. (Same Handed), That has -- that shows Redshank 1 So, here you have a situation where we know that 2 Redshank Investments Limited was a College Trustee 3 client. 4 after that, it had informed various parties with 5 regard to the Registered Office and we know that 6 Redshank Investments is connected with the 1984 7 payment. 8 mathematically prove it at this stage that Redshank 9 Investments was a Liam McGonagle company but we We know that in 1985, which was the year We are of the belief but we cannot 10 believe that to be the case. 11 those things together we had a certain concern? 12 A 13 306 Q 14 Putting all of Yes . And I will not put it any stronger than that; all right? 15 A 16 307 Q Yes . The only other document I want to show you, 17 Mr. O'Shea, is this: 18 document. 19 A 20 308 Q 21 A 22 309 Q 23 A 24 310 Q It is a 18th May 1992 It is page 30 (Same Handed), Exhibit 9? Thanks. That does not appear in your statement, Exhibit 6? No, and I have no recollection of it. Yes? I have no idea what it is for. I wonder would it be an earlier part of the £40,000 25 even though the £40,000 was there in December 1992? 26 Could it have been £50,000 and could this be £10,000 27 of it? 28 29 A I don't think so. 1 2 312 Q 3 You do note that they are talking about "Ansbacher" Limited? 4 A 5 313 Q 6 A 7 314 Q 8 Yes, I do. Rather than Hamilton Ross? Yes . However, you can take it that Hamilton Ross and "Ansbacher" were interchangeable? 9 A 10 315 Q 11 A 12 316 Q 13 Indeed, yes. Names used by these parties? Yes, indeed, yes. And I would not attach too much significance to that ? 14 A 15 317 Q 16 Yes . However, you can see that it is a payment not to Mr. McGonagle? 17 A 18 318 Q 19 A 20 21 You think it is separate from that. Yes, Kennedy McGonagle Ballagh. But to Kennedy McGonagle Ballagh? Yes, I can see that. I can see that. I am -­ I have no idea what for. 319 Q 22 I wonder could you investigate that? There is bound to be a record of that somewhere? 23 A 24 320 Q 25 A Yes. 26 321 Q Yes? 27 A 28 322 Q 29 A Yes . It is only 1992? Yes, I agree. I agree. I wonder could you give us an explanation of that? Certainly, okay. 1 323 Q 2 A None. Not at this point in time any way I don't 3 but I certainly will -- I mean we can check our 4 ledgers and find out from that; hopefully find 5 out from that. 6 324 Q 7 You see could I explain where we are going, Mr. O'Shea? 8 A 9 325 Q 10 A 11 326 Q Yes, yes. So that everybody understands where we are? Yes . We will have to consider all the evidence as to whether Mr. McGonagle was a Client of "Ansbacher"? 12 13 A 14 327 Q Yes . Obviously I cannot tell you what the result of that conclusion will be? 15 16 A 17 328 Q Yes . However, let us assume for a working hypothesis at 18 the moment that we concluded that he was a Client 19 of "Ansbacher"? 20 A 21 329 Q Yes, yes. We then have to separately consider whether 22 Kennedy McGonagle Ballagh were Clients of 23 "Ansbacher"? 24 A 25 330 Q 26 A 27 331 Q 28 A 29 332 Q Yes . It is a separate consideration? Yes . And we are highly conscious of that? Yes . Of keeping it separate? 1 2 333 Q 3 So, that is why we are particularly honing in on this (indicating), Exhibit 9? 4 A 5 334 Q 6 A 7 335 Q 8 And we can come back to you on that. Yes ? I will come back to you on that. Yes. All right. That would be great. I wonder when you are coming back to us on that? 9 A 10 336 Q Yes . Would you do us the courtesy of when you are 11 writing to us in the letter would you put a note 12 at the bottom of the letter to say that, 13 can be included as part of my sworn testimony"? 14 A 15 337 Q 16 A 17 338 Q 18 "This Sure . Do you understand that? Yes, yes. That will enable us then not to have you to come back to swear it again? 19 A 20 339 Q 21 A 22 340 Q 23 Fine, okay. Do you understand? Certainly. I think that may will be in everyone's interest to do that? 24 A 25 341 Q Certainly, okay. I wonder could you do that reasonably quickly 26 because we are getting to the end of this phase 27 of our inquiries? 28 A 29 342 Q Yes . And we are obviously anxious to tidy it up fairly 44 1 quickly? 2 A 3 343 Q Yes, yes. I think there is only one other thing that I have 4 to say to you and it is this: 5 a telephone call with you on the 27th February and 6 that is grand? 7 A 8 344 Q 9 A 10 345 Q 11 A 12 346 Q That Ms. Cummins had Yes . It was only a housekeeping telephone call? Yes . There is no difficulty about it? Right. However, the last sentence is: 13 14 "He also told me that Liam McGonagle had arranged through Des Traynor for a job to be done for the partners and they were unaware of the extent of it until relatively recently." 15 16 17 18 19 What were you referring to in that? A 20 I presume we are referring to the payment in 1993 of the fee. 21 347 Q 22 A 23 348 Q 24 A 25 Yes? I presume that was it. Yes. Could it have been anything else? I can't think of anything. have been anything else. 26 349 Q 27 A 28 350 Q 29 A All right? No. That is grand? No, it wouldn't 1 351 Q. 2 A. 3 352 Q. 4 A. 5 353 Q. 6 A. 7 354 Q. 9 A. 10 355 Q. 11 A. 12 That that was in fact the situation? Yes, that is my recollection of it. That is your recollection? But I mean you surprised me about that other payment Well... (INTERJECTION)? No, I have...(INTERJECTION). In 1984 or 1992? Which is more surprising to you? No the -- not that one (indicating). The other one in 1984 I think. 13 356 Q. 14 A. 15 357 Q. 16 A. 17 358 Q. 18 A. 19 1984? Isn't it the memo? Yes, I see? On the 5th September 1984, Exhibit 7. Yes? I am surprised at that. I have no recollection of that. 359 Q. 21 You have no recollection of that at all. I do understand how these things can happen? 22 A. 23 360 Q. 24 A. 25 361 Q. 26 Yes. Without you having a recollection of them? Yes. However, I wonder whatever about the 1984 one which is mildly suspicious? 27 A. 28 362 Q. 29 Yes, that is m y ...(INTERJECTION). in 1984. 8 20 I just wanted to check? Yes. The 1992 one is a positive connection? 1 363 Q 2 A 3 364 Q 4 A Yes, okay. 5 365 Q All right? 6 A 7 8 Which has to be explained? Sure . I mean that is the position? Well, we can hopefully get that explanation from you. 3 66 Q 9 10 Ms . Mackey? MS. MACKEY: No, no questions. JUDGE O'LEARY: Mr. O'Shea, thank you 11 very much indeed. 12 A 13 367 Q Thank you. That is actually everything we have to say to you 14 and thank you very much for all your cooperation 15 and we appreciate it greatly. 16 early replies. 17 you could do that? 18 A 19 368 Q We would appreciate It would facilitate us greatly if Yes, yes. Obviously part of the process is the signing of the transcript? 20 21 A 22 369 Q 23 A 24 370 Q Yes . Because it is included in the Legislation? Yes, yes. I mean obviously...(INTERJECTION). So, in due course Ms. Cummins will be in 25 touch with your firm and you can make the 26 necessary arrangements? 27 A 28 29 So, I mean I can come in to sign it whenever it is ready. 371 Q All right? 1 2 And copies of the transcript can be got for a 3 payment of? 4 MS. CUMMINS: £60. 5 JUDGE O'LEARY: Of £60. 6 A 7 373 Q All right? 8 A Thank you. 9 374 Q 10 A Yes . Thank you very much indeed. Thank you. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED .i?p 44/6.? gaffur?? .2 w; y; 7.3 Efw? I MICHAEL O’SHEA I understand that I have been called to give evidence pursuant to the Inspectors’ powers set forth, inter alia, in Section 10(2) o f the Companies Act, 1990. I am here today because o f the exercise o f the Inspectors’ right to compel my attendance. I am not here voluntarily. I am not prepared to answer questions voluntarily. I understand the Inspectors have power to force me answer their questions, provided always the questions are within the scope o f their investigation. All answers I give today f»re given as a result o f the exercise o f the Inspectors o f their powers under Section 10 anw «r such other statutory powers as they have to compel answers and not otherwise. I have asked the Inspectors not to exercise their power to compel my testimony. They have insisted I answer all questions under compulsion o f law. K ennedy M cG onagle B allagh I n c o r p o r a t i n g B e l l B r a n i c a n O ’D o n n e l l & O 'B r i e n s o l i c i t o r s 20 NORTHUMBERLAND ROAD DUBLIN 4 TEL 660 9799 PAX 660 9434 EMAIL: info@kmb.ie www.kmb.ic The O ffice o f the Inspectors appointed b}Aiii, iiAU.ACiii I'uit:nc ‘i;i:. i m x o n k c v i n c . i u i m v n o w * •*.ji ix ,i assistants :h u n a iiim r y a u v i h a n. n v i m 4. Also in 1995 the firm was instructed in relation to an application by the Company to the High Court for leave to extend the time for filing Form 47 with the Companies Office in respect o f the security referred to at 3 above. The Company discharged our fee o f £400 plus outlay for this work which was again handled by Olivia McCann. 5. I have personally been involved in advising a number o f clients who have had or have a relationship with the C om paq and this advice has been given in the context o f McCracken and Moriarty Tribunals and statements and attendances before you. ■ The Company ' .•* provided no service to me personally and I have not established anv trust manured by the Company nor tr» m u i m H ^ am T-the beneficiary o f a n y trust managed by the Company. I have not deposited any money with the Company or with Guinness & Mahon (Ireland) Limited however Kennedy McGonagle Ballagh has from time to time used the services o f Guinness & Mahon (Ireland) Limited. It has deposited the Finn’s money and clients’ money with that Bank from time to time and during one or both o f the Bank strikes it used banking facilities provided by that Bank. Guinness & Mahon has provided a normal commercial loan to the partners in the firm including me to fund the purchase o f No. 18 Northumberland Road. This loan was secured against the property purchased and our personal guarantees. It was not secured on any funds held by the Company. Apart from the service mentioned at 2 above, provided by Kentford Securities Limited, no service has been provided to me by any o f the other companies listed in your letter namely, Amiens Securities Limited, Amiens Investments Limited, and Irish Intercontinental Bank Limited. The only services provided by Guinness & Mahon (Ireland) Limited were those mentioned above in the preceding two paragraphs. No service has been provided to me by any o f the companies mentioned in your letter and established in the Channel Islands. Yours faithfully, Coaid 70a please lodge the attached cheque tor 28,250 Sterling to Sundry Persona and give ae four. Sterling drafts as follows:Michael O'Shea T. Dixon £1,030 £1,650 Redshank Znvestnents £3,138 250 I J.k.T. JDT/AJW CollegeTrustees Limited MCA/ 2nd May, 1985 H. M. Greffiar. Royal Court House, St. Peter Fort, . Guernsey. • ' •, ’ ■ IS • ' Dear Sir. __ _ . 'SfeQ/ .. i . RETV!HANK XNVESTHEHTS LIMITED ' \ The registered office and tha post office box’number of -the above companies' was changed on 15th April, 19B5. The regis­ tered office is now situated at*- . ■ Plateau Kignot, Rue des Cornets, St. Peter Port, Guernsey. ' ' . Correspondence should now be addressed to P.O. Box 223. Yours faithfully. . •• for COLLEGE TRUSTEES LIMITED, ' P.O. ttux 122. St. JnliimV Cmirr, ». Julian** Aireimc, Sr. Peitr Pan, fiuemwj, Channel bhmlx. TisispHwie: dicrnMV 3(! 9.397%} FORWARD A..- CARRIED FORWARD ANSBACHER LI Ml'. P.O. Box 887 Grand Cayman British West Indies Telephone No. 9— 4653/4 Telex CP 305 Cable Address Guinness A/A54 ACCOUNT NUMBER 300016/42 PAGE BALANCES SHOWN ARE IN: sterling 3 7 'V,9. 5 9 3 0.00 37549.59 __________ y J ■ H B ■1 ,(«!! ■•> > S : f l K f fc'f'ffrtV 1 BROUGHT FORWARD . • .■!!'>/-) ■ ' . M' > r : i I (/()'■)/9.M 1 /irs /'J ; drawn 1V v ’ -'I.' ’ • ■/ i n ■ < ■ 13 / 0 9 / 9 3 1 3 / n u /<.>;-) DHAWN i i -W ’.y ? . n? • !1 ' ' ■: i 'mm r > \ ! ' ! /u<)/o->, >11/[Vi/<)'\ j j w j r j n . oo III! n r r s l . t o DRAWN DRAWN [\{\ / y y . \ \ V ______________________ CARRIED FORWARD 3 0 /0 9 /9 3 ANSBACHER LIM I'.iD P.O. Box 887 Grand Cayman British West Indies Telephone No. 9— 4653/4 Telex CP 305 Cable Address Guinness A/A54 ACCOUNT NUMBER 00001.642 PAGE BALANCES SHOWN ARE IN: s t n r 1in g gas 4 39338. 5.1 10050.00 6701.92 .00 5M75.00 4590.on 3764.00 10036,.'39 1682.51 Vi 2.04 2 1 2 4 .5 5 ____________ / / FOREIGN EXCHANGE DEALING TICKET T Z ^ X 'Z J m rA crs^ m n . _________ TttMwyCopy \~ f(o4ui>ifl>A l ’* E U U k *•■----- 1 * ■wMWawr. BMSMOTL L-i— — K i ? ° rr_________ _ / r ^ MiaMl —I NOSmOOUT JSh SSSBmS m InllMI IBM—t ■g' ff«aO .*Q 1 1 I Curr.etfcO. Itwm Reuter aa* Q OUTTO-ClafrilnalRXttona ^C J& JK JU fl/» LK. ^flUJOUA. Cf»q».ajrr. CXfla.nt». RcXj«A RoflOf.l^CL ^)ICP I 3 tZ k S - h b ><* y v ° NO*7Ws" iE. /5ft iz NOSTROM * \ 668345 Pi©M» SpotDataA*rtOm I t#* A CwMnMHwiCal NfCN^M OSfWMMM f / * I FOREIGN EXCHANGE DEALING TICKET TnmurfCepf _________ i i 668346 spgtonnwtDMi v n ttt— X fl-W I NoemoM 1 a Wcbuvaot W ttiy M — Cmr.oOA •A + Bvotor Q tmm % fiwm fMW a.a- OUTTO'CMnrainairadkm CilpC bU» IPO Cftqumr. CUQfcOTt M . D 'S L j « v . Normo ------ - PnftnMUMie* Fw O w n * / , CSManmi »*1*110 l£ P 1 ' • .V \ • I ... . >• ’ '' •• t / 7 s ' ■•-V FOREIGN EXCHANGE DEAUNQ TICKET, !>—HtyOawr CuatonMT M U I f c id l fia n u flfiv w 6683.47 ■/• ••••' ■ .• ‘ , spotOMinMiOMi NCmmROM 3 * •■' vi: . !■ VtfutMto s h it ^ • •* •r* Vniil ,• ■.• .■ ■ -ji?V., -•■ ■-.-.M ■BMDhKMW. w§ tones; «* toy Art **#*•*■___ & 8 2 & o a \o i3 & * « 2 NOSTRO OUT •oldfluff. C M ML W kU lM . 6 ® T. JZ&J& IBP I Our.*SJ». ; «x » Tain PIMM Rtuar •.IX* ,'J) OUTTO-CtonninMuaiont O U tju * *1 ". J^Q ChQ^CtffT. CUQMWi X^iy.Ot0 ! 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A!MaturityOUTTO C**nft Maturitymatruetlcm ^ OUTTO- Clmn Initnidfaiw i - —».— * • C J k a q u sL (tfraqdradandnot toWMMltlN) IP O & c L o lv au * JC 4 r u j a / 5 t > v u u ^ ' / J t j IW W - NOSTRO ^ .CefHitnebeoCsl ParCtaawi .o .ia n MASON HAYES & CURRAN S O L I C I T O R S Office of the Inspectors appointed by the High Court to Ansbacher (Cayman) Limited, 3rd Floor, Trident House, Blackrock, Co. Dublin. 14 December 2001 M atter : Y o u r Re f : O u r R e f : DM/PC Ansbacher Dear Sirs, We act for Mr. Roger Ballagh, a partner in Kennedy McGonagle Ballagh, Solicitors, 20 Northumberland Road, Dublin 4 who has requested us to write to you in response to your letter to him dated 23 November 2001. Having considered the “Inspectors Preliminary Conclusions” we are at a loss as to how the information (such as it is) or the reasoning (or lack of it) justifies the “Preliminary Conclusions” reached. / “■v What is clear is that Kennedy McGonagle Ballagh was due a fee and it was paid. The partner to whom it was paid gave Mr. Desmond Traynor the money and in due course caused it to be returned to the partner in a manner that divided it between himself and other partners. It is said the monies, part of which were received by Mr. Ballagh, came from Hamilton Ross or an entity unknown to our client (a matter you assert but do not sustain by any evidence disclosed). This does not prove your conclusions even if true (a matter not conceded or accepted). In short your “Preliminary Conclusions” that Mr. Ballagh was a client of Ansbacher are ill founded. This finding has been arrived at by you, without any evidence having been heard or taken from our client which quite clearly is in breach of his constitutional rights and fair procedure. No proof whatsoever has been produced to show that Mr. Ballagh was a client of Ansbacher. He is not, and never was, a client of Ansbacher and indeed had no knowledge of that Bank, nor the other companies mentioned. Even allowing for your apparent broad interpretation of 6 F itzw illia m S q u a r e , D u blin 2, Ireland , D X 1 1 D u b l i n , Tel + 3 5 3 1 6 1 4 5 0 0 0 , F ax + 3 53 1 6 1 4 5 0 0 1 , w w w .m h c .i e , K-inail m ail@mlic.ie M aurice R. C u rra n , M aeve H aves, A nthony Burke, D eclan M oylan, L orcan Buckley, Enter G ilvarrv, Paul .I- G. Egan, C olm an P. C u rran . N o ra Larkin, D eclan C u rra n , R ichard A. W oulte, Kevin Hoy, D eclan Black, Liam Brazil, A ilhhe Gilvarry, J o h n Kettle, D avid O ’D onnell, N iall M ichel, J o h n Kchoc, Peter M clnnes Srninr Assncuitcs N iam li C larke, M atrliew W ales, M ajella D o lan , G illian M cN am ara , Shane M acSw eeney, Susan R yan C fu n n ltn iK A . IV n n n r M nsiin. C n n al I. Clancv. R orv I.. Euan Carson McDowell in B e l f a s t “client”, this word quite clearly has a specific meaning as defined in all the standard dictionaries and under none of these definitions can Mr. Ballagh be held to be a “client”. Therefore we require your confirmation by return that no such conclusion will appear in your Report. Yours faithfully, / MASON HAYES & CURRAN MASON HAYES & CURRAN S O L I C I T O R S Office of the Inspectors appointed by the High Court to Ansbacher (Cayman) Limited, 3rdFloor, Trident House, Blackrock, Co. Dublin. 15 January 2002 M atter : , Y o u r R e f: * J t - O u r R e f: DM/PC Ansbacher Dear Sirs, We write on behalf of Mr. Roger Ballagh. Thank you for your letter of 21 December 2001 in response to ours of 14 December 2001. Your refusal to amend any part of your preliminary conclusion is entirely unacceptable to our client who is outraged by it. Our client understands the pressures upon you to produce a final report. However we must, with respect, suggest that the treatment afforded our client is grossly unfair and does not vindicate his rights in any respect. Our client has never been called to give evidence before you and so far as we are aware the sole communication he has been involved in with you is his letter of the 16th March 2001 written in response to a request by you. The relevant portion of that letter is to be seen in paragraph number 2 in which the following is said:“Also in 1993 a fee paid by a U.K. client of the Firm was lodged by the partner who acted for this client with the late J.D. Traynor and this fee was subsequently paid to the partners including me through Kentford Securities Limited. The partner who handled this matter was the late Liam D. McGonagle who was a personal friend of the late J.D. Traynor. The U.K. client was not a client of the Company and did not avail o f any o f the services provided by the Company. I believe Mr. Traynor merely facilitated my late partner Liam D. McGonagle and neither he nor the Company nor Kentford Securities Limited were paid a fee for this service’’. 6 Fitzw illia m S q u a r e , D u b lin 2, Ire la n d , D X 1 1 D u b l i n , Tel + 3 5 3 1 6 1 4 5 0 0 0 , F a x + 3 5 3 1 6 1 4 5 0 0 1 , w w w .m b c .ie , E-mail m ail@ m hc.ie M aurice R. C u rran , M aovc H ayes, A nthony Burke, D eclan M oylan, Lorcan Buckley, Em er G ilvarry, Paul J. G. Hj»;in, C olm an P. C u rran , N o ra Larkin, D eelnn Curran, Riclian.1 A. \YouHi\ Kevin H oy, D eclan Black, Liam Brazil, Ailhlie Gilvarry, Jo h n K ettle, D avid Senior Assticuitcs O 'D o n n ell, N iall M ichel, Jo h n K ehoe, Perer Mclinnes N iam h C larke, M atth ew Wales, M ajella D olan, G illian M cN am ara , Shane M acSweeney, Susan Ryan C o m ult,nils A. D ermoc M aso n , C onal f. C lancv. Rorv I.. Etran______________________________________________ an 'llllancc Carson McDowell Your preliminary conclusion is premised upon a narrative that states as follows:- “Mr. Michael O ’Shea, Mr. Roger P. Ballagh and Mr. Terence D. E. Dixon are Solicitors in the firm o f Kennedy McGonagle Ballagh, 20 Northumberland Road, Dublin 4. Their involvement in Ansbacher arose out of their late partner’s (Mr. Liam McGonagle) long-term involvement in offshore banking. During 1992, fees earned by the firm were deposited, at the suggestion of Mr. McGonagle, with Mr. Desmond Traynor and ended up in an Ansbacher account. The sum involved was £40,000 approximately. The money was left on deposit offshore for some time and then shared out among the partners. The payments were made from a Hamilton Ross account in Ansbacher. The IIB dealing tickets show that Mr. Ballagh received over 1R£11,530.00, Mr. O ’Shea and Mr. Dixon received IR£6,243.00 each and the firm received IR£4,877.00 and a company controlled by the late Mr. Liam McGonagle stg£6,701.00. All the partners who shared in that fund were thus clients of Ansbacher. The Inspectors’formal decision on the late Mr. McGonagle is to be found elsewhere in the report’’. It is said that the preliminary conclusion, which you stand by, is: “Mr. Michael J. O ’Shea, Mr. Roger Ballagh and Mr. Terence Dixon were clients of Ansbacher”. The evidence supporting your conclusions is said to be a statement by Mr. Michael O’Shea, evidence given by Mr. Michael O’Shea, the exhibits produced at that hearing (by you) and the seven further exhibits set out. Your “Preliminary Conclusions” Some Preliminary Points We can find nowhere in the transcript of Mr. O’Shea any suggestion that he was asked to represent or indicated that he represented our client Mr. Ballagh. On page 10 of the transcript we find, however, that Inspector O’Leary stated: “We must identify the client of the company we are investigating... Ansbacher”. We note in the “foreign exchange dealing ticket (document 5)” appended to your preliminary conclusion, it is expressly stated that the customer is “Hamilton Ross”. What Mr. Ballagh has said, which is uncontradicted by any evidence that we have seen, is that the fee paid in 1993, by a client of Kennedy McGonagle Ballagh, was subsequently divided among the partners including Mr. Ballagh. He made it clear that the matter was handled by Liam D. McGonagle. He made the point, from information he received after the event, for the purpose of attempting to respond to your queries, that the fee was received in the manner detailed. In the circumstances, we might respectfully suggest that a fair analysis of this transaction, if it is one that has any part to play in your report, would be as follows: “In 1993 Mr. Roger Ballagh, in his capacity as a partner in his Solicitors’ practice, received part o f a fee earned by one of his fellow partners Mr. Liam McGonagle. Mr. McGonagle took responsibility for recovering the fee from the partnership’s client and making the arrangements for its distribution among his fellow partners. It now transpires that the payment to Mr. Ballagh was effected through a company called Kentford Securities Limited. It now appears that the payment in question was effected by Hamilton Ross drawing on a bank account maintained with another bank (possibly Ansbacher (Cayman) Limited). Mr. Ballagh was not party to the arrangements that Mr. McGonagle put in place. Whilst it is clear that Mr. Ballagh received a payment through Kentford Securities Limited we have not been able to establish whether he was a client of Ansbacher”. We do not believe that there can be any objection to presenting your conclusion in that manner. We say this, subject always to you explaining the matters we refer to above. We have to say that we are gravely concerned by your refusal to engage in any meaningful dialogue in relation to your preliminary conclusions. As a matter of common sense, it is not fair. As a matter of law, it is also a denial of our client’s right to fair procedures. The fact that you have written to our client clearly establishes that:(a) your conclusion constitutes “a finding or inference adverse to Mr. Ballagh’s interests, good name and/or reputation (b) Mr. Ballagh has the right to be: (i) (ii) (iii) (iv) (v) informed in writing of the proposed finding or inference informed of the evidence which is thought to justify the proposed finding or inference afforded the opportunity to prepare a written reply to the proposed finding or inference afforded, by way of further examination on oath, an opportunity to introduce rebutting evidence and/or to address the Inspectors afforded an opportunity to cross-examine the relevant witnesses. In circumstances where you have simply failed to engage on the case made by Mr. Ballagh concerning the suggestion he should be described as a “client of Ansbacher" it is incumbent on us, for the purposes of protecting his interest, good name and reputation, to take this matter further. Please note that we require the following:1. The opportunity of producing evidence that in relation to the distribution of the fee, Mr. Ballagh had no knowledge of the arrangements being put in place by Mr. McGonagle and absolutely no knowledge that the monies that he received had, at any time (if that be the case, a matter we do not accept that you have evidence of) been retained in an Ansbacher account. 2. We also require that we be entitled to address you. Clearly, the procedures you yourself have adopted provide for the right to have an interplay of views between yourselves and persons such as Mr. Ballagh for the purposes of permitting him to appropriately vindicate his interest, good name and reputation. In the event that we cannot make some headway in dealing with your preliminary conclusion, either by following our procedural rights as identified above, or through some other means, our client wishes the opportunity to cross-examine such witnesses as you have who can give relevant evidence that the monies in question were ever in an Ansbacher account. Perhaps you could identify these witnesses and indicate when they will be made available for cross­ examination and deliver a transcript of the evidence they have given. We note in your procedures that where issues arise between any person and your good selves, a procedure of seeking directions from the High Court to resolve issues is referred to. Should we fail to reach an accommodation in relation to the provisions of your report to which we refer, we reserve our right to be the subject matter of such application. You will be able to appreciate the impossible position Mr. Ballagh finds himself in. He is a solicitor and an Officer of the High Court. He has received a share in a fee due to a legal practice of which he was a partner. In circumstances of which he knows nothing it is alleged that part of this money may have been held in an account operated by Ansbacher. We have to say, with the greatest respect, that to see him designated as “a client o f Ansbacher” with the damage to his interests, good name and reputation that such a designation will bring, is unfair, unjustified, unnecessary and irrational. In relation to the monies paid to Mr. Ballagh, he objects to being dealt with in a section of your report that also deals with other persons. Finally, it seems to us a brief meeting between the representatives of yourselves (or better still yourselves) and this office could go a very long way to defusing what on the face of it, appears to be a confrontation that is entirely unnecessary. Mr. Ballagh has no problem accepting that he received the payment in question. His objection is to being called a client of Ansbacher, an institution the services of which he never knowingly utilised, or wished to utilise personally or for any client. We assume that pending your response to this letter, no report will be published containing the sections concerning Mr. Ballagh. If this is not the case please tell us and we will take the necessary action elsewhere. Yours faithfully, A >v. MASON HAYES & CURRAN r Appendix XV (2) Mrs Frances Elizabeth Barrett 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mrs Frances Elizabeth Barrett. a) Extract of clients provided by Padraig Collery. b) Letter of 19 February 1990 from JD Traynor to Guinness and Mahon. c) Letter of 4 September 1990 from JD Traynor to Guinness and Mahon. d) Letter of 8 May 1995 from DP Collery to Mrs Frances Barrett. e) Letter of 9 October 1995 from DP Collery to Frances Barrett. jv. •• j .- • ... v . . • . ' 7r-'r: , V-^uv:-’k o ^ . . . v •* » . . ................... Ansbacher Limited^ AI4m»bvo(toHMvAad»dMtHaU&fiB*eaSfi: >reply to: 42 Fitzwilliam Square, Dublin! Croup P.O . Boa 887, Gnmd Ctymm, Britbh V w India n m w (809) 949-4653/4 T *U kC ? « 0 1 H » (809) 949-7946 (809) 949*3267 • Ifcfc765144/763063 Rue 612035 19th February, 1990. N. Lanigan-01Keeffa, Esq. Managing Diractar, Guinness a Mahon Limited, 17 College Green, Dublin 2 . Dear Martin, . Prom time to time over the past number of years Guinness a Hahon Dublin have made arrangements with Guinness Hahon & Co. London so that Mrs. Frances Barrett may call to collect cash. The usual procedure has been that Guinness A Hahon send a letter to Mrs. Barrett authorising her to collect the money and she brings this with her when she calls in to Guinness Mahon & Co. She invariably rings G.M. a Co. in advance of calling to arrange a suitable day and time but it would be no harm to remind her to do so. She usually asks for Brenda Bartlett but if it should be anyone else dealing with the matter perhaps you could let her know. ^ • ' I would be grataful if you could put these arrangements in hand for her to call and collect Stg.Sl0,000.00. She is not'sure just when she will be able to travel to London but once she receives your letter she will make plans. The debit should be to the Account of Colinas Investments. Mrs.Barrett's address is: The Laurels, Clifford Chambers, Stratford-upon-Avon, K S ! hlri CT37 8“ \ J ^i/e /c. r/ v^ k° . * O A *>9 * 0 3 Yours sincerely, ' J.D. Traynor. . *Jr-‘ . .V , • • y. . . ' Please reply to: 42 Fitrwflliain Square, Dublin Z lisb 765144/763065 Fax: 612035 Phoa« (OS) MMIS3/4 T«facCP«BS Rue (UN) 94S-7»4< (109)949-12*7 4th Septem ber, 19S N. David Humphries, Esq., Senior Manager - Operations, Guinness ft Mahon Limited, 17 College Green, DUBLIN 2. Dear David, From time to time Guinness 1 Mahon, with Guinness Mahon A Co. London so nay call to collect cash. fin has- made arrangem ents »t Mrs. F rances B a r r e t t The usual procedure has been that^ Guinness t Mahon send a letter to Mrs. Barrett authorising her/to collect the money and she brings this with her when sheycalls in to Guinness Mahon & Co. She invariably rings G.M . a Go. in advance of calling to arrange a suitable day and tine but/it would be no harm to remind her to do so in the letter. S)ie usually asks for Brenda Bartlett but if it should be anyone else perhaps you could let her know. I would be grateful if fou could put these arrangements in hand Stg.£7,500 in cash and Stg.£7r500 in so that she may colle< . large denomination S rllng Travellers Cheques. As soon as she receives your letter she will make arrangements to travel to London and as she is anxious to do this as soon as possible I would ^appreciate if you could write to her without delay. The debit shoo Ld be to Coral Beef Securities Limited Account No.12686001. Mrs. Barrette's address is: The Laurels, Clifford Chambers, Stratford-upon-Avon, Warwickshire CV37 BHX England. Yours sincerely, I . WINSXAYXBN STRU T, DUBLIN S. HX.MO> 014793331 FAX NO. 01-4791750 8thMay. 1995. Mn. Frances Barrett, TheLaurels, M U L - i unmocn, fj.. l,.rl utnora Stratford Upon Avon, WarwkJcdriwi CB378HX Dear Mfe. Barrett, The deposit matured on 3rd May in the aurt of Stg£6S5,492J5. Pleaaefindeodoaedachedule showing the rollover details. ' ■ TbeaumofStg£10,0S1.55 win be credited to the account ofCoral Reefin GufanesaMahon & Company United, Londoa. I abo enclose a tfatement itor that account Kind regards. Yours daaeniy, . . 1 0 IN N S C O U B T , wnnRAVVsN s t r e e t , D « T B L E F H ■. i a c s e m O •I U N b 1 B L IN E N je h . 0 1 -6 7 9 3 2 3 1 O o . n -e n v m ■ . 9th October, 1995. Met. Ranees Barrett, The Laurels, Clifford Chundwa, Stratford Upon Avon. Waraickshire, CB37,8HX. Dear Mn. Barrett, . *. * • The deposit matured on 4th October, in the sum of8TQ£S7S, 467.47. Please find endosed •chedule showing the rollover details. . The sum of SRCbE3.329.47 will be credited to tbs account of Coral Roofin Chibaan Mahon & Co. Limited, London. • Kind regards, Yours sincerely, Appendix XV (3) Mr John Barrett 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John Barrett. a) Internal Guinness and Mahon memo o f 4 May 1983 from JD Traynor to P O ’Dwyer. b) Letter o f 4 May 1983 from JD Traynor to Mr John Barrett. c) Letter o f 4 May 1983 from Guinness and Mahon to Mrs Brenda Finnimore, Guinness Mahon & Co. Ltd. d) Letter o f 7 October 1987 from JD Traynor to Guinness and Mahon. ' ■ " -A tta c h e d h e r e t o mre c o p ie s o f l t t t w s w hich I h a v e . ' s e n t tp Jo h n B a r r e t t u d M re. m in c e s B a r r e t t . . *.• .* I h a v e s e n t p e o p les to B ren da f in n ia o r e an d w ould be. ■ g r a t e f u l iif jr o u w ould sp eak to h e r to c le w r , t e l l i n g h e r “to " d e b l^ a s . ' , . I n tu rn w o uld yo n n o te to d e b it th e £ 7 ,0 0 0 to • is C o lin a s In v e stm e n ts U n it e d and t h s £ 1 0 ,0 0 0 to . {. G .M .C .T . " 8 .2 " D e p o s it. V* j J1W/AJW JDT/AJtf T l n n w y MW,OwMi* Tale*: SS20&. N i l i r < QHtae: 11 COM—i S u m , Q m lh t * ...................... M O W . ##1«•Cwiwwe*>•••6m* ~m ■■wuMn OtoaratK f ttriU n nitMinrr Cub*** tCh«U*M>, HJ>. Fm m w (IdiUN. A.M , ffufHw nXIAH . tfiitnw—. OiHmM OX H » ffH tm l. XC. Lew Jw .. D.T. 0 ~C—«e*.0 . P—ise J. Own m l Tw»»e> I0 »ew»» CluliwxO , M>mH> I . O 'Ktm I 0 — » C. MeCW . Gahni C J. W«Omwm llecreMfyl.i, Si*Hchi Umm w. M m t< j . H o w. Appendix GUINNESS+MAHON LTD 17 Cslba* Oftmt Oubfin t P.O. Box S5ATtl: 71S944 (t 7 Lin«> PERSONAL 4th May, 1983. John B a r r a t t , E s q ., 34 Moncktoa C o u rt, Addison Hoad, LOWPOW. W14 8W?. Dear Jo h n , - T h is Is to co cJin * th a t I have mad* arrangaaants w ith K rs . Brenda Fin n ia ore o f Guinness Mahon fc Co. L t d ., 32 S t . Mary a t H i l l , tendon XC3P 3 A J, to p ro vid e you w ith £10,000 S t e r lin g in cash. W ill you ple ase sake sure th a t you g iv e h e r 24 hours* n o tice by rin g in g her a t (0 1 ) 623 9333 t e llin g h e r what way you would lik e the cash. She w i l l g ive you the cash in exchange fo r th is la t t e r . K in d e st regards, Tours s in c e re ly , J .D . T ra y n o r. c . c . M rs. B . fin n ia o re . JDT/AJW T w n w i 'AeikOuM KTwH; 2SX 1 * 7 ------ ■ * V U i 1 n t r . ? . n i » H iw m » m M w . Ia m . Nen4 » w * e O tfsm n. JX . IC W w w l, *. 0 . EuiMM jt ruMsi. ftm w in , J.1 A.H 0 .1 mu ttm w u , i.C Ot m s .O . la ikiu. ___^ CMftrtweCkmwrv i .O tm tM T n»«w <0 — f» Chtiimml.Um t m t . O m > » Mwa»»«>.Q«"« C i. M eOnaan tt —wu wf, X Mwww, Mm m i. <•* Guinness Mahon ft Cm . Ltd. . . ' s ^ oatb 4th May, 1963. TEST: Attention; Mrs. Brandt Flmiaora (*) Please arrange to debit our account 5{g. 11,000,00 and pay s«m to Mrs. Francas Barrett. ' ' \ (t) Please arrange to debft our account Stg. £10,000 and pay saw to John Barrett. r . J - 0. Traynor has written to the above and has forwarded copy letters to you. Many thanks. Fat O’Owyer. AUTHOHISBDBY: DEBIT: COST: PILE: / <£■«> “JDT/AJW JDT/AJTf a . —■ »j i M i l 19Lew PembrokeStreet OuMrl Teteprcne 01)783069 J. 0. Tiynor 7th October, 1987 17 College Grea DOBLIW 2. Dear S ir* / Xany thanks f o r le t t in g me have the envelope c o n ta in in g John B a r r e t t '* o ld W ill from my d o s s ie r. R e c e ip t enclosed h e re w ith . I a ls o enclose envelope marked 'Jo h n B a rre tt L e tt e r c f W ishes' and would be g r a te f u l i f you co u ld p u t t h is in my d o s s ie r w ith th e envelope marked 'Jo h n 3 a rre tt - W i l l 1. Many thanks. Yours f a it h f u lly , Appendix XV (4) Mr Jesus Barrios & Mrs Maria Barrios 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Jesus Barrios & Mrs Maria Barrios. a) Mortage Deed o f 20 December 1984. b) Guinness and Mahon Credit Committee Memorandum o f 24 April 1985. c) Guinness and Mahon Credit Committee Memorandum o f 12 Novem ber 1986. d) Letter o f 4 August, 1987 from Mike Shield o f GMCT to Guinness and Mahon. e) Letter o f 24 April 1985 from P O ’D o f Guinness and Mahon to Mike Shields o f GMCT. f) Telex o f 18 December 1985 from GMCT to Guinness and Mahon. g) Telex o f 18 December 1985 from Guinness and Mahon to GMCT. h) Telex o f 19 December 1985 from Guinness and Mahon to GMCT. i) Extract o f evidence o f Sandra Kells to Moriarty Tribunal 17 February 2000 . jssi ig£ 2 6 AX9s9 8 8 4 R3 8 7 8 2 8 n.;. « I2364re 559 iHnrtijaijF Sfpfc ___ < t l;iu i H n r l l W I J f D r r h . b>. 2 * o 7 fi in a tli- a n d r x n - u l « l Ih v December t in y u f JESUS L. BARRIOS and MARIA C. BARRIOS, h i s w ife h e r e i n a f t e r c a l l ' d t h e M o r t g a g o r , w h ic h t e r m s h a l l i n e l o d t U m h e i r * . l e g a l r e p r e a a n U U v e a . s u c c e s s o r * a n d a s s ig n s o f I h a s a i d M o r t g a g o r w h e r e v e r t h e « m t » K t M r v q H ir r t o r a d m it* . t* GUINNESS and MAHON LIMITED h c r a i n a A a r c a l l e d t h e M o r t x a t ii- e . w h i c h U r m ( h a l l in c lu d e U u h e i r * . l e g a l r e p r e s e n t a t i v e s , s u c c e s s o r * a n d a s s l f n * . o f t h e a a i d M o r t g a g e * w h e r e v e r l l i r r v m c t l no r e q u ir e * o r a d m its . S J illir n a r lt l: T l i a l A ir • liv e n . t u « » l a m i v a lu a b l e n a » fa li> r a llu a K . a w l a i m In c a n n iiU in lu m o f t h e a w t r r K u le m ihii i i a n u i l i n iIh - jiriiu iin > r> ' M r » r <■<■>« i l a i r h e r e w i t h I w r i 'i i i a f l e r i l n v r i l w t l . I lie s u i t l M u r l g a g n r OoM h e r e b y g r a n t . b a r g a i n . M il a lk m . r u m ia e . r v le a a e . c u n w y a n i l i n n f i r m u n l u l l u - a a a l M i . r l ^ R . v , hi> l a - i n . f r n t t o r * a m i a a a i g n a . a l l t h e c e r t a i n p ic u e . p a r c e l o r t r a c t o f l a n d , a I w h ic h t i n s a i d M o r t g a g o r l a n e w a e ia a d a n d im h k w m I a n d in a c t u a l i n a w m i w . s i t u a t e i n t h r * Dade a n d S l a t e o f F l o r id a , d e s c r ib e d a s f o lt o w « Beain 35 f e e t South o f the N.VI. corner N.E. 1/4 p f M/W* 1/4 o f S.E. 1/4 of Section 18, Township 54 South, Range 40 East} thence South 248.76 feet} thence E ast 178.76 f e e t - th en c e North 248.97 feet} thence West 179.37 fe e t to th e Point of Beginning; Less th e West 25 fe e t th ereo f and le se th a t p o rtio n ly in g o u ts id e th e N orthw est auadrant o r a c ir c le having a radius or 25 re s t and being tangent to a lin e 35 feet South o r the North lin e or the S.E. 1/4 asid Section 18 snd ts n g e n t t o a l i n e 25 reet E a st o f the West lin e or the N.E. 1/4 o f the N.W. 1/4 o r th e S.E. 1/4 Section 18, Township 54 South, Range 40 E ast, a/k/a 10990 S.W. 32nd S tre e t, Miami, F lo rid a . < £n S o u r n u b 1 0 $ o U > t h e s a m e , t o g e th e r w it h a ll a n d lin g u la r th e te n e m e n ts , h e r e d it a m e n t * a n d a p p u r te n a n c e s t h e r e u n t o b e lo n g in g o r in a n y ­ w is e a p p e r t a in in g a n d t h e re v e tlio n a n d r e v e n io n t , r e m a in d e r a n d r e m a in d e r !, r e n t i, l u u e i a n d p r o f it s t h e r e o f a n d s ls o aU t h e e s t a t e , r ig h t , t it le , in t e r e s t , p r o p e r t y , p o s s e s s i o n , c l a i m a n d d e m a n d w h a t s o e v e r a s w s B i n l a w i s In e q u i t y o f t h e s a id M o r t g a g o r i n a n d t o t h e s a m e a n d e v e r y p e r t a n d p a r c e l t h e r e ­ o f u n t o t h e a i d M o r t g a g e e , a n d h i s h e i r s , s u c c e s s o r s a n d a s s ig n s i n f e e r i m p t a . A n d a a i d M o r t m i t o r . t e r M m s s U . a n d h i * h e i r * , l e g a l r e p r e s e n t a t i v e s , s u c r t s s o r s a n d a s s ig n * . h e r e b y c o v e n a n t s w i t h s a i d M o r i m x e e . h i* h e ir * . h i n t —r e i i r a m n t a t i v e e . a u c c c a a o r * a n d a t a i g a s . t h a t a a id M o r t g a g o r fa i n d e h a a i h l y s e is e d e ( s a i d te n d in f e e s i m p le : t h a t t h e « l d M o r t g a g e r h a s f u l l p o w e r a n d l a w f u l r i i c h t i o ^ ^ S i v e y U tr n a m e i n f r * s i m p l e a s a f o r e s a i d : t h a t i t s h a l l b e l a w f u l f o r s a i d M o r t g a g o r , k i s b o i r a . l e g a l r e ) w o « n U l i v * » . n ic e e s e o r a a n d a a n ix n a . a t a l l t im e * i w a r e a b l y a n d ■' u i r t i y u r n i e r U am . h a h l . w r u p y a m i e a i n r a a i d la n d a m i e v e r y p a r t th e r e o f . t h a t s a id ta m l I* f r e e t r a m a l l I n c u m b r a n c e * . e a r c p t th o a e iM ie c if ic n lly n w n l i o t m l in ( h M v - i i r x t w t h a t r e a l > l r w lp * i i n r . h t a h * l r » . ! » - W r * p r » « e n i a i l « * . * u c « * « i e r * n i i d e * M g n * . w i l l n t a l i e * i « h f a r t h e r e a a u r a n c o e i o i i e r f e c i i l i e f e e t t f m p l e i s t l e i u i i a f t l l i i i w l i n M o n t m i e c . hi# h c i i t . l - t i p i r e « * - • t fa t lv e .m ie c e s a e r * a n d a s s ig n s . u m a y r e t u e n a b ly b e r e t iu ir w i: a m i t h a t n i d M o r t i i a j w r t l i w a h e r e b y f u l l y w a r r a n t t h e l i s l e M M n tl l a m l a m i e v e r y t i a r t th e r e o f a n i t w i l l M e n d t h e n a m e u i a i n n t h e l a w f u l c la im s o f a l l i w r w m w h o m i w v e r . . - i f lr iH U t lr ll A l u m t l f l . ( t in y , to -w il: . . . T h a t i s s a i d M o r t g a g e r s h a l l p a y u n t o t . l i e * a l i l M a r t « a g e e l h e c e r t a l a p r o n i i e s o r y n o l e . o l w h i e h O > e f o l lo w i n g i n w o r d f a a d f lg u r e * i > * t r u e . • < j , 'S.0'10.03 i d X V A lU L KfcCtlVED tlm . , p io m it u ; l e p a y t o 1H* orwn from ......................„ ...D .C ..C C X n b . f t X .............................................................. ... 8 ^ - - : , - - . - — ..7...- ..— 00 / X X .1 9 8 4 u n t il m a tu r ity , b o t h p r in c ip a l a n d i n l w u l l b a i n s M y a h l a in l a w f u l M o n e y o f th e U n ite d S t a l a i , s u c h p r in c ip a l tu rn a n d i n l a r e n p a y a b l e in m t u . l m a n n M l-.lla w s , Interest only shall be paid Quarterly, comntcncing March P -o jn 198S, and shall continue to be paid every throe monthrf thereafter. The entire Principal amount plus all accrued and unpaid interest shall be due and payable Docc-mbcr ?. i> hi 19 8S S u c h in tt.illm e A l p a y m e n t* t h a ll b « * p p i i .d firU to th e in t a r a it a c c r u in g u n d e r th e ta ra v i o l th is n o l e a n d th a n to a r e d u c t io n o l t h e p r in c ip a l tflifab * 'tJn < * is. Ih o m a i o r t i n d e n flo fv o rs » f i h n n o te fu rth e r a s » e to w a i v e d e m a n d , a o t i « o f n o n -p a y m a n t a n d p r s t « t , a n d in th e e v e n t t u ii s h a ll b e brou> ;hi tz,i i l i a • .. i... s* M o tl 0f 1A a tto r n e y , to p a y r e a s o n a b le a t t o r n e y 's f e e s fo r m a k in g su c h c o llo d io n . A ll p h « .. Credit Memorandum Submitted by : PO'D esus BamOsT^M aria C. Barrios / DDRESS : ' \ S. W. 78th Place, Miamia, Florida 33144. Equity S tak e: No. C. B. Approval : Yes / No US1NESS / CCUPATION : Permission Obtained Date : HIS APPLICATION : YPE Loan New Facility / { Delete as appropriate ) AMOUNT : $75.000.. RATE FEE : If new or increased facilities, is drawdown permitted prior to completion o f security ? > U lO s E I DRAWDOWN : Investment purposes. ' YES / M8X REVIEW .DATES : rERM OF. FACILITIES : 20th December, 1985 SOURCE OF REPAYMENT : Not stated. n /A 20.12.1985. ~ . SECURITY : Mortgage over property as outlined In Mortgage Deed dated 20.12.1984. Property in County o f Dade, Florida. Promissory note dated 20.12.1984. t Security considered adequate. If additional or existing facility, is security in order ? ♦ YES / hi® If No, give details separately.. BACKGROUND NOTE / The account has been Introduced to us by C.M.C.T. We have OUTLINE OF PROPOSAL : ‘ jn tj,e pasl opened similar styled accounts for G.M.C.T. We have received from G.M.C.T. the mortgage document signed by the applicants together with a copy o f the Promissory Note. IRELATED FACILITIES / 'Br Cor >3375.00 cowing Interest on tbs above loan for quarter to 20th June 1987. Kindly credit our U.ff. Dollar account with Qi London with $3187.50 whan dee tad. Yours sincerely, MICHAEL W. SHIELD Encl. i - GUINNESS+MAHON LTD 17 CnHfjt Qrean Dublin 2 P.O. Box BBA T*l: 716944 (30 LIms) 24th April, 1985. Our R ef: PO'D/SC Mr. Mike Shields, Guinness Mahon Cayman Trust Limited, P. O. Box 887, Cruiid Cuyinun, BRITISH WEST INDIES Jesus * Maria C. Barrios D ear Mike, Confirm having opened value 20th December, 1984 a..loan..for U.S.$75,000 in th e above name. Confirm having opened a deposit in the name o f G.M.C.T. for a similar sum. Both loan and deposit will mature on the 20th Decem ber, 1985. A sum o f $3,375 has been debited to the loan account being Interest due as at 20th March and 1 confirm that I have received a cheque representing interest due. A t the same tim e the 7 Day N otice U.S.$ Account in the name o f G.M.C.T. at Guinness Mahon & Co will be credited value 25th April with U.S.$3,000 and U.S.$187.50 representing interest due on your deposit to 20th March, 1985. A further payment o f interest will fall due on 20th June, 1985. Regards. Yours sincerely, for GUINNESS + MAHON LIMITED. Pat O'Dwyer, Banking Manager. T aupftm t: M m , OuMto. T a m : 2S X 6 QIIIm: 1? CftUa&a S tm a , OuWl* 2 . NwmtMC 10233. A. m tm b * af «lw 25205 23205 M AtiS E l * M ARS E l A3Q5 GMCT CP IB DEC 1983 6M DUBLIN ATTN* PAT 0 ' DWYER Ti£ BARRIOS ^ ^ r ' f" * ' WHEN I ASKED YOO IF THI3 WAS A FIXED RATE LOAN YOU 8AID YES. I THEREFONt KtNHWtU AT SAME RATES IE 18 TO YOU 17 TO US AND 16 TO BARRIOS. I THINK IT MUST BE A FIXED RATE LOAN AS RATES IN EFFECT IN DEC 84 MERE B 0 / 0 ODD. JAF IS IN PR0CEB8 OF COLLECTING THE INTEREST. HE DID NOT PARTICULARLY WANT IT ROLLED OVER WITH THE INTEREST, i ROLLED OVER * 7 5 .0 0 0 EVEN AND MILL SHOW THE DLRS 3 1 8 7 .3 0 AS AN ACCRUAL. PLEASE CONFIRM IF IT IS A FIXED RATE LOAN AND CONFIRM YOU WILL USE SAME RATES AS BEFORE. " RE PRUNA AGAIN AGREE ALL YOUR FIGURES* BUT ME WILL AGAIN SHOW AS AN ACCRUAL NOT AN INCREASE IN THE BALANCES. PLEA8E AMALGAMATE DLRS 2 3 3 0 0 0 AND DLRS 7 0 .0 0 0 . THE OLRS 7 0 .0 0 0 WAS AN INCREASE IN THE DLRS 233000 LOAN. - r* - 6MIN N E S S MAHON CAYMAN TRUST* 7 > » r r ^ > W u L ': N H i .S S >IAH‘>H -M Y H A K T P U S T < m iH H £ s s > n A H '! H l i m r s t ' / i t IRELAND D A TE •• UEDHESPAY A TW •• /**. W AT It DECEM BER LOAM A H O M A R IA U .S . • W 1943 o u b lih 2 / . S H IE L D F U R T H E R TO YOUR T E L E P H O N E R E D O E S T O F A D V I S E T H E F O L L O W IN G 1 JES U S / CA M A N I P L E S co u e se s ^ t t r O LR S T H IS B A R R IO S 7 3 ,0 0 0 (S E V E N T Y F I V E H O R H IH E . U t H IS H TO ' TH OU SAHO B O L L A B B ) T H IS LO A M IM S S T A T E D S * YO U A S A PR U H A L O A M , B U T , IM F A C T , I T I S IM T H E H A H E O F B A R R IO S . UHEM T H E L O A N N A T U R E S O H . T H E 2 0 O E C E H S E R S 3 I T H A S S E E N D E C ID E D TO E X T E N S S A M E TO 2 : D EC EM B ER i t . S U S S E S T U E C H A R E S I N T E R E S T . O H L.0 4 M ■ .. . A T t o P C T P E R AH HVH AHO ALLO W IN T E R E S T OH B E P O S IT A T » • P C T PER AHHUH. ' IN T E R E S T O F U . S . O L R S 3 * ? 7 > . 0 0 ( T H R U TH OUSAHO T H R U W M D R E O A H O S E V E N T Y F I V E ' H I L L B E D E B I T E D TO T H E L O A M O H T H E 2 0 O ECEH B ER J 9 4 3 1 U H IL E IH T E R E S T O F U .S . 0 L K 8 3 , t B 7 . 3 0 < T H * £ f‘ TH OU SAHO O H E H UNDRED * E IS H T Y S E V E N .S O ) H IL L B E M aSA ' T O T H E D E P O S I T A C C C -V H T . ’3 S F T ] ' REGARDS 2 52 05 MARS E l TO TO r FffOM t PATE s GUIN N ESS MAHON CAYMAN TRUST A T T E N T IO N M IKE S H IE LD GUINNESS*MAH0N L IM IT E D / DUBLIN / ' IRELAND THURSDAY 19 DECEMBER 1985 d> RE - BARRIOS AGREE H IL L LEA V E IN T E R E S T RATES ON LOAN AND D EP O S IT A T 18 PER CENT AND 17 PER CENT R E S P E C TIV E L Y . IN T E R E S T OF DLRS 3 ,1 8 7 .5 0 H IL L BE DEBITED AND H ILL VALUE DATE CHE6UE FOR IN T E R E S T V »FH ffFCFJUFn p A W TO 3 1 S T DECEMBER 1985. AGREE H1CL AMALGAMATE BOTH U fA N S . INTWEPF.ST HAS A L R E A D Y BEEN D EB ITED TO THE ACCOUNTS . PROVIDED HE ^ o t r r t r MJf PROMPT PAYMENT H IL L VALUE DATE E N T R IE S TO 2HD DECEMBER AND 1 * rn pecrHRFO » F ^ p r r r r x t K L Y. (4 REGARDS GUTNNESS*MAHON L IM IT E D Dtifil. IN TIM E 13170 SORRY ONE L IM E HAS GARBLED H IL L REPEAT (3> PRUNA AGREE WI LL AMAGAMATE BOTH LOANS. » * r / m ia J je e M N IN TE R E S T H A S ____ ' A ieCTriU TTFQ Tf)f)A Y r* 1 308 Q. 2 I think you have informed the trib u n a l th a t M r. Pruna and c-frt*-1" o f h is associates, including a H r. B a rrio s had been. 3 of charges, including opera tin g and nnnapir in g to 4 cparaha a ce n tim in g cr iminal enterprise dedi cat ed to the 5 j TYrtrt-aHwn o f cocaina and marijuana in to the Oait*d States 6 frcm 1981 to 1988; is that correct? 7 A. 8 - ■ 9 ' Yes. CEMBMHJ: X ju s t wccder is there a ccpy o f the updated io — 11 - \ u 13 MR. CEOGHLAKT: I hog your pardon. - Yes. 14 . 15 csnnsnssi Proceed, in any e v w t .v is 17 /*** Of the surplmwntva? . 309 0. MR. cm sussr: Yes. Mfcw, I th in k you ham .i-rrfhrwid the 18 Trib u n a l th a t you understand from i nfam aticc. provided hy 19 the "Tribunal, th a t the relevant documents were produced to 20 the President o f the D is tric t Cburt cn the 18th o f 21 1990, and th a t the depoaihlnn of an o f f ic ia l o f Q-Hraww ; 22 and Mahon was ta k m before the President o f the D is tric t 23 Court cn the same date; is n ’t that correct? 24 25 310 A. I understand th a t, yes. Q. You fu rth e r understand by in fa zn a tim provided to the 26 Trib u n a l that Mr. Pruna was subsequently convicted and 27 served a p riso n sent ence? . 28 29 311 A. I believe so, yes. Q. Stow, I thin k you were able to inform the Trib u n a l th a t i t 30 a©pears from the bank's records that Mr. Fernando Pruna. was 31 a custoccar o f Guinness Mahcn Cayman Tru s t and was 32 ' introduced by Guinness Jfehan Cayman Tru s t to flnl-nrwgg »-nH Anaerica, was repaid, i t was repaid b y the hypothecated ,1 2 funds? 3 4 400 A. Yes. Q. Mbw, can you express a n y view about that par t l cn la r ' transaction, i f I could aslc you th is : Whs i t the s a w funds 5 were loaned b y Guinness tehcn in Dub li n were 6 e ffe c tiv e ly used b y Cetynan to hypothecate the sana? 7 A. 8 Yes, the mceey was q uite s in g ly taken from the loan, ananm t and put in to the deposit account. r * pa id out o f D ublin, they didn ' t 10 a. 401 403 Q­ leawe the bank. Sbey newer le f t tba beat*? So npaynent o f uas tba mooey **** Vw n loaned/ in effect? 14 15 16 mm A. 12 13 Q. The manias were not 403 A. P re cise ly. Q- And th a t gave tbs appearance to tba outside w orld a t le a s t, 17 car anycne IncHdng in , th a t the loan bad in the f ir s t 18 instance been granted b y D ublin; is n 't that correct ? 19 '•N J 404 A. T h a t's co rre ct, yes. Q­ O r a t le a st i t enabled somebody to g ive an inprriflsicii th a t 11 a. 1r«m VoiH ho«m jjn, fa ct - - 22 A. 23 24 ' That f a c ilit y was prov ided k y Dublin to Harthside Maoageneot. 405 Q. "Sea. Hfcw, i f I could cone to deal with. »tw -> w ^xsacain 25 th is series o f loans? 26 Gninrnfls and Mahcn of $75,000 to a Mr. Jesus and Mrs. M aria 27 B a rrio s; is that correct? 28 29 406 I thin k a loan was A. H u t 's co rrec t, yes. Q­ And X think wa now know that they were aa«rv^ at-ap Df Pruna? Jll. 32 407 mwfa b y A. They were. Q- Of one form or another? Trib u n a l, He. warring was also named in the le tte rs 2 rogatory as a person Inrtintnct w ith the same change as Me. 3 Pruna; is n 't that correct? 4 5 415 Yes, he was. Q. And from your eacandnatlcn does i t ag u r th a t in ocim ai 6 w ith the Pruna loans, i t TT * * 'r" that th is loan was also 7 discharged by re sort to the backing deposit? 8 416 A. Tea, i t was by the backing deposit. Q. Bow, I think you have been a b le to Inform the Trib u n a l, 10 th a t apart from loans vtoich was a c tu a lly nade b y Guinness 11 and Mahon, i t appears M r. John Fuxze any have purported to 32 neks fu rth e r loans in the nano cx£ Guinness and Itabcn. to 13 -•* Hrooriim Investments and to N r. and, Mob. Andreas Pruna; is 14 th a t correct? 15 ' 16 417 A. H a t 's correct, yes. ' Q. And i t is your b e lie f that th is could o n ly haws been ckne 17 i f Ktr. 18 sta tio n e ry which he used fair th a t purpose? AO t A. 418 Fuaa had, in p o s itio n Guixmsss Ibthoa, A. Ooiczect, yes. Q. And from the f ile s there appear to be a t le a st two 1 il inatancifts of sudh n o n -fa c ility -node a t the j-nstanne o f 22 GninneBs ttdann (Cayman Tru s t)? 23 a . 24 25 T h a t's correct, not an extensive search, but What have ocm to o ur attention. 419 Q. Yes. I th ick in the f ir s t inntanrift i t agpeaxs that in 26 January 1985 Sir. Furze wrote to Guinness and Mahon 27 enclo sing three rihaqjuaa to ta lin g $327,299.92 made payable 28 to OriimiMa and Mahcai and draua b y Muadna Investrant 29 Cacpotraticn, Florida; ia that correct? 31 32 420 A. That is correct, yes. Q. And the proceeds of these cheques appear to have been lodged by Guinness and Mahon to Guinness Mahan (Cayman o 1 2 A. 492 Q. 3 493 lim ite d "; is th a t correct? A. Yes. Q. And »a n records p e rta in in g to any aoocunt In tha nans o r 6 names o f Fernando Pruna*. 7 8 " A ll documents, cxirraspondence, and reaords perta in in g to Much 4 5 Yes. 494 A. J U lia Pruna. Q. " J U lia Pruna, M arla Isobel la Use Hbare B a rrio s , f o r any o£ 9 those io - rmmmA persons, in clu d in g w ithout lim ita tio n acconnt statements, c e rtific a te s o f deposit and deposit hope ■ U records"? ^ 12 13 A. 495 Q. And " A ll rtw w rriai statements prepared b y o r aa hrihalf o f gmnando Pruna, Andreas Pruna c r any corpo rat i on car 15 businass e n tity in which tornando ftruna o r Andreas Pruna i s 16 an o ffic e r, d ire c to r o r major shareholder"; is that 17 o orract? 19 496 A. Yes, yes. Q. Yes. 20 I th in k the pe rio d covered b y the B»ftpoena was the 1st o f January, 1981, to the 1st o f Septrnnfesr o f 1988; is r*" 21 th a t oarrect? \ 22 23 A. 497 Q. 24 26 498 27 28 Th at 'a co rre ct, ye s. And I th in k the subpoenas ware to be ocqplled w ith b y th e 23rd o f Septenfcer o f 1988? 25 • Yes. 14 18 : Hdw do you pracwaice that? A. T t a t 'a rig h t , ye s. . Q. Mow, I th in k cn the 20th o f September o f 1988 H r. W allace, the American law yer, wrote to the A ssista nt IB State A tto rn e y ra is in g issues as to ju ris d ic t io n and whether o r 29 rust the subpoenas were binding cn Cayman, D ub lin o r Mars 30 Nbmiaees Limited? ^ 3 1 32 A. 499 Q. Yes. And I think cn tbs 22nd of September, 1988, Cayman * r 2 559 Q. "The iviWHti banic had now sold the Cayman Tru s t to Ansbacher 3 Lim ite d. 4 t^wrifpri hftid 5 associates, and made loans and had hypothecated deposits 6 made b y the Prunas"? 7 8 Hie niihHw headquarters of Guinness and Mabcn nortgages fa r the Pruaas and th e ir A. 560 Q. 9 ■Cameqpcndenca oqacenring these matters passed between the tru s t In Grand Cayman and the offic e s o f Pat O'Dwyer, JD 10 Trayno r and Badraig O o lle ry and others in the P ih U n 11 bank. 12 the Eninas’ names and th e ir associates' names, hut also 13 the names o f th e ir 14 records show that QiinnftBB andMahon Lim ited held imii~gmj is 15 o r In te re sts In Pruna pro p e rty", and then i t sets o u t: "The 16 artxtpw and persons th a t were the subject o f the 17 were as fo llo w s :", and included axe the Bcunas, Mars 18 Nominees 19 20 561 R e se dgpnatta and transactions were not o n ly m ndnBB **** »•>» B a rrio s '; operations. is n 't correct? A. Maoadna. Q. And then W asttair togestaaenta, Haaodma, Harthsiria - KM, Bateau Jfemagercent 22 TfcflrHngn Lim ited, W estfair Cbndcndniua Sect)a c t, Zaran 23 Mor t gage? 25 26 27 28 2 9 30 31 32 A. Yes. in Vac mcagple, 21 24 In and Development, Sbrthgate, Texas Appendix XV (5) Mr Anthony Barry 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Anthony Barry. a) Transcript o f evidence o f Mr Anthony Barry dated 14 February 2000. b) Letter o f 26 February 1991 - Ansbacher to IIB. c) Cheque for STG£9,000 o f 25 February 1991 to credit o f Ansbacher Limited Call Account. d) Letter o f 7 September 1992 - JD Traynor to IIB. e) Extract o f list o f clients provided by Padraig Collery. Correspondence written on behalf o f Mr Anthony Barry. a) Letter o f 15 August 2 0 0 1 from O ’Flynn Exhams & Partners to the Inspectors. UNDER OATH ON MONDAY, 14TH F E B R U A R Y 2000 I h e r e b y c e r t i f y the f o l l o w i n g to be a t r u e an d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer MR. JUSTICE COSTELLO MS. M A C K E Y B.L. S O L I C I T O R TO THE I N S P E CT O R S MS. M. C U M M I N S INTERVIEWEE: MR. A N T H O N Y B A R R Y R E P R E S E N T E D BY: MR. THE INSPECTORS: RORY COLLINS O'Flynn Exham & Partners 17 U p p e r P e m b r o k e S t r e e t D u b l i n 2. 1 THE H E A R I N G COMMENCED, 2 F E B R U A R Y 2 000 AS FOLLOWS, ON MONDAY, 14TH 3 4 MR. JUSTICE COSTELLO: 5 Mr. Barry, we will start our interview. I am 6 D e c l a n C o s t e l l o a n d o n m y r i g h t is m y f e l l o w 7 inspector, 8 H i g h Court, 9 Ms. Ms. M a c k e y . as y o u know. Cummins, We were a p p o i n t e d b y the I will ask our solicitor, to a d m i n i s t e r t h e o a t h t o you. 10 11 MR. A N T H O N Y B A R R Y H A V I N G B E E N S W O R N W A S E X A M I N E D , 12 FOLLOWS, B Y MR. AS JUSTICE COSTELLO 13 14 1 Q. MR. JUSTICE COSTELLO: 15 Mr. Barry, w o u l d you mi n d g i v i n g us a l i t t l e b i t o f 16 b a c k g r o u n d of y o u r p e r s o n a l 17 b e c a m e the C h i e f E x e c u t i v e of 18 your career was before that and your p osition now? 19 A. career and when you 'CRH' and brie f l y what I am a civil engineer by b a c k g r o u n d and I qualified 20 in 1 956. 21 w o r k e d a b r o a d m o s t l y on m a j o r c o n t r a c t s . 22 a m b i t i o n to r e t u r n to I r e l a n d as a m a r r i e d m a n a n d 23 after bri e f l y working with CIE and the County 24 Council 25 C o r k Ci t y b y the name of 26 w h i c h s p e c i a l i s e d i n t h e e x t r a c t i o n of s a n d a n d 27 g ravel and the m a n u f a c t u r e of r e a d y m i x c o n crete and 28 concrete products, 29 industry. For the first s even or eight years I It w a s m y I joined a local bui l d i n g materials f i r m in ' J o h n A. W o o d L i m i t e d ' and supplied the b uilding I w o r k e d t here f r o m a bout 1964 until 1 2 3 T h e p r o p r i e t o r J o h n W o o d d i e d in 1 9 7 2 a n d I b e c a m e 4 the M a naging Director. 5 D u b l i n b e c a u s e J o h n A. W o o d L i m i t e d h a d b e e n 6 acquired by a company called 7 subsequently merged with another company called 8 'Irish Cement Limited' 9 n o w kn o w n . I w a s t h e n a s k e d t o go to 'Roadstone' to c r e a t e which 'CRH p ic ' as it is T h a t h a p p e n e d i n 1 9 7 0 a n d I m o v e d to 10 D u b l i n o n w h a t w o u l d I s u p p o s e b e p r o m o t i o n to r u n 11 w i t h i n t h e R e p u b l i c of I r e l a n d a l l o f t h a t t y p e o f 12 activity; 13 of c o n c r e t e a n d v a r i o u s p r o d u c t s w i t h t h e e x c e p t i o n 14 of c e m e n t . e x t r a c t i o n of r a w m a t e r i a l s , manufacture 15 16 I j o i n e d t h e b o a r d of C R H p i c in 19 78 a n d I w o r k e d 17 as a n E x e c u t i v e D i r e c t o r o f t h e B o a r d r u n n i n g a f t e r 18 i n i t i a l l y al l t h o s e o p e r a t i o n s 19 Ireland, 20 a n d I t h i n k in 1 9 8 2 or 1 9 8 3 it w a s e x p a n d e d to 21 include the cement business 22 U n i t e d K i n g d o m and all our b u s i n e s s 23 Kingdom. 24 2 Q 25 A 26 3 Q 27 A 28 4 Q 29 A in the R e p u b l i c of s u b s e q u e n t l y i n c l u d i n g the N o r t h of I r e l a n d in I r e l a n d a n d t h e is i n t h e U n i t e d When did you become Chief Executive? I b e c a m e C h i e f E x e c u t i v e i n 1988, J a n u a r y 1st 1988. B e f o r e that yo u h a d b e e n on the B o a r d of D i r e c t o r s ? As an E x e c u t i v e Director, yes. W h e n d i d y o u f i r s t m e e t Mr. Traynor? I w o u l d h a v e first m e t h i m I s u p p o s e a b o u t 1973 or 1 19 74. 2 step outside Dublin and have a meeting, 3 C o r k o r in s o m e o t h e r a r e a w h e r e t h e r e w a s a m a j o r 4 s u b s i d i a r y a n d I w o u l d h a v e m e t Mr. 5 p r o b a b l y at t h a t time . 6 5 Q. 7 A. 8 E v e r y t h r e e or four y e a r s the B o a r d w o u l d W h e n d i d Mr. Mr. 6 Q. 10 A. in Traynor briefly T r a y n o r b e c o m e a m e m b e r of t h e B o a r d ? T r a y n o r b e c a m e a m e m b e r o f t h e B o a r d i n 1 9 7 0 at the f or m a t i o n of 9 perhaps 'CRH'. You met him regularly then after that? No, not very regularly. Until I joined the Board 11 m y s e l f in 1978 12 than once or twice. 13 I o b v i o u s l y m e t h i m at e v e r y B o a r d m e e t i n g t h a t he 14 w a s at a n d t h a t 15 7 Q. 16 A. 17 8 Q. 18 A. 19 9 Q. 20 W h e n I j o i n e d t h e B o a r d i n 197 8 I w a s at. He w a s C h a i r m a n f r o m 1 9 9 . . . . ( I N T E R J E C T I O N ) . No, he b e c a m e C h a i r m a n i n 1987. Y o u b e c a m e C h i e f E x e c u t i v e in 1988? A b o u t a y e a r la t e r . So t h a t y o u r r e l a t i o n s w o u l d h a v e b e e n v e r y c l o s e indeed? 21 A. 22 10 Q. 23 24 I probably wouldn't have met him more Yes, Mr. v e r y c lose i n d e e d f r o m 1988 onwards. Traynor, I think, h a d an o ffice in the headquarters ? A. No, I t h i n k t h e r e is a m i s u n d e r s t a n d i n g . The 25 r e g i s t e r e d o f f ic e of 26 c a l l e d Pem br o k e Street a nd that was also the 27 h e a d q u a r t e r s of Irish Cement Limited. 28 C hief E x e c u t i v e we sold the Pembroke Street 29 h e a d q u a r t e r s w h i c h at t h a t t i m e c o n t a i n e d t h e o f f i c e 'CRH' i n i t i a l l y was in a p lace When I became 1 of t h e C h a i r m a n , 2 the E x e c u t i v e s 3 m o v e d the C ement L i m i t e d c o m p a n y out to m u c h sm a l l e r 4 o f f i c e s in S t i l l o r g a n . 5 m o v e a n d w e b o u g h t p r e m i s e s at 42 F i t z w i l l i a m S q u a r e 6 to h o u s e the C h a i r m a n a n d the S e c r e t a r y a n d to h a v e 7 it as t h e r e g i s t e r e d o f f i c e o f ' C R H ' 8 the head office of'CRH'. 9 w a s r e a l l y i n B e l g a r d C a s t l e in C l o n d a l k i n a n d t h a t t h e C o m p a n y S e c r e t a r y as w e l l as of the C e m e n t L i m i t e d company. It w a s a r a t i o n a l i s a t i o n b u t it w a s n o t The h e a d o ffice of'CRH' 10 is w h e r e t h e C h i e f E x e c u t i v e a n d h i s w h o l e 11 m a n a g e m e n t t e a m and all the c o rp o r a t e e x e c u t i v e 12 o p e r a t e d from. 13 11 Q. 14 A. 15 12 Q. 16 A. 17 13 Q. 18 A. 19 14 Q. Y o u w e r e in B e l g a r d C a s t l e t h en? I w a s in B e l g a r d C a s t l e . Mr. T r a y n o r t h e n w a s in 42 F i t z w i l l i a m S q u a r e ? Yes. He h a d o f f i c e s t h e r e a n d h e w o r k e d f u l l - t i m e ? Full-time, yes. I t h i n k t h e a r r a n g e m e n t w a s t h a t he w o r k e d 20 full-time, 21 on his own o u t s i d e i n t e r e s t s ? 22 A. We Yes. not just on the affairs of'CRH', but also It is g e n e r a l l y u n d e r s t o o d i n m o s t c o r p o r a t e 23 companies that 24 r e q u i r e a C h a i r m a n to b e a v a i l a b l e i n a m a j o r 25 c o m p a n y to t h e c o m p a n y at a l l t i m e s , 26 u n d e r s t a n d t h a t he a l s o h a s o t h e r i n t e r e s t s a n d t h e y 27 are g e n e r a l l y p u r s u e d f rom the same o ffice and the 28 company provides 29 that to happen. I am a s s o c i a t e d w i t h t h a t if you secretarial y o u h a v e to facilities to allow 1 15 Q. 2 Y o u k n e w o f Mr. T r a y n o r 's c o n n e c t i o n w i t h G u i n n e s s Mahon? 3 A. 4 16 Q. 5 Yes. Did you know had'CRH' ever had any commercial dealings with Guinness 6 A. 7 17 Q. 8 V e r y few, & Mahon? to m y k n o w l e d g e . D i d y o u k n o w t h a t Mr. Traynor had left Guinness A. 10 18 Q. Yes. Did you know about the s u b s i d i a r y in the Ca y m a n 11 Islands and the fact that he h a d p u r c h a s e d the 12 subsidiary? A. 14 15 19 Q. he h a d a c o n t i n u i n g in terest You knew about the subsidiary, w h a t h a p p e n e d to t h e subsidiary? A. 18 19 I was g e n e r a l l y aware, in b a n k i n g . 16 17 Yes, I did. I c a n ' t s a y w h e t h e r I k n e w p r e c i s e l y at the time or w h e t h e r I l e a r n e d subsequently. 20 Q. 20 Y o u k n e w t h a t a m o n g Mr. Traynor's interests was a c o n t i n u i n g b a n k i n g i n t e r e s t a f t e r he h a d l e f t ? 21 A. 22 21 Q. Yes. This b a n k i n g interest was a s s o c i a t e d in some way 23 with the subsidiary company that had been a 24 s u b s i d i a r y of Gui nn e s s 25 A. 26 22 Q. 27 A. 28 29 & Mahon then? 9 13 & Yes. D i d y o u k n o w t h a t A n s b a c h e r in f a c t h a d t a k e n o v e r ? No, I wouldn't have known the name all. 23 Q. & Mahon? At that stage? 'Ansbacher' at 1 A. 2 3 No, but I think I learned subsequently that A n s b a c h e r had bought the business. 24 Q. I w a n t y o u to d e a l w i t h as m u c h d e t a i l as y o u c a n 4 remember, 5 Mr. 6 a r r a n g e m e n t s t h a t y o u m a d e w i t h him. 7 can you remember where the discussions were held? 8 A. 9 Mr. Barry, with your conversations with T r a y n o r w h i c h le d up to the f i n a n c i a l Not precisely, but F i r s t o f all, I u s e d to m e e t Mr. Traynor p r o b a b l y in 42 F i t z w i l l i a m S q u a r e b e c a u s e it s u i t e d 10 m e t o go i n t h e r e e a r l y . 11 q u i t e e a r l y at 7 o ' c l o c k o r 8 o ' c l o c k a n d he w a s 12 always 13 t i m e t o h a v e h a l f an h o u r o r a n h o u r . 14 and Chief Executive, 15 t h i n g s w h i c h w o u l d be, 16 affairs of the G r o up 17 25 Q. 18 19 It w a s a v e r y c o n v e n i e n t The C h a i r m a n g e n e r a l l y I w o u l d h a v e l i s t of if y o u like, c u r r e n t in the ....(INTERJECTION). A m I to u n d e r s t a n d you w o u l d v i s i t h i m in his office? A. 20 21 in at 8 o ' c l o c k . We no r m a l l y started work Yes, all the B o a r d m e e t i n g s were h e l d in B e l g a r d Castle. 26 Q. M a i n l y he w a s w o r k i n g f r o m h i s o f f i c e i n F i t z w i l l i a m 22 Square and w o u l d you not a sk the C h a i r m a n to come 23 out to Belgard, 24 Chairman? 25 A. 26 27 Q. 27 A. 28 28 Q. 29 A. o r y o u w o u l d g o i n t o se e t h e Yes. W o u l d that be p r a c t i c a l l y everyday? No, e v e r y two weeks. Every two weeks? On average, p e r h a p s not even three weeks beca u s e 1 t h e r e are t i m e s w h e n I w o u l d be out of the c o u n t r y 2 for t h r e e weeks. 3 29 Q E v e r y c ouple of weeks or p e r h a p s e v e r y t hree weeks 4 y o u w o u l d go in a n d v i s i t h i m w i t h t h i s l i s t a n d go 5 in e a r l y in the m o r n i n g ? 6 A 7 30 Q Yes, and I w o u l d have a list of correspondence. Apart f r o m that of c o u r s e yo u w o u l d h a v e t a l k e d b y 8 telephone. 9 p r i v a t e a f f a i r s t o o k p l a c e in F i t z w i l l i a m S q u a r e ? 10 A 11 31 Q 12 A You think the discussions I think probably, about your own yes. Who initiated them? I think I p r o b a b l y indicated that I had a problem, 13 w a n t e d to t r a n s f e r m o n i e s to m y c hildren. 14 have in general 15 r e l a t i o n s h i p at t h i s s t a g e 16 32 Q I know, Mr. conversation, Barry, I would b e c a u s e we h a d an easy ....(INTERJECTION). it is v e r y d i f f i c u l t t o r e m e m b e r 17 w i t h p r e c i s i o n w h a t h a p p e n e d a g o o d n u m b e r of y e ars 18 ago, 19 remember, 20 yo u can r e m e m b e r an d i n d i c a t e to me w h a t yo u t h i n k 21 m a y h a v e h a p p e n e d b u t y o u c a n n o t r e m e m b e r it. 22 A 23 33 Q 24 25 b u t I w o u l d l i k e y o u to t e l l m e if y o u do n o t tell m e you do not r e m e m b e r a n d say what Okay. Tell me what you t hink or what you can r e m ember about the conversation that you initiated? A I t h i n k it p r o b a b l y w e n t a l o n g t h e s e li n e s , that I 26 am in r e c e i p t of not a v e r y c o n s i d e r a b l e a m o u n t but 27 s o m e f o r e i g n i n c o m e w h i c h is o u t o f d i v i d e n d s , 28 of c o m p a n i e s 29 e x p e n s e s w h i c h w e r e p a i d in s t e r l i n g b e c a u s e we in t h e UK, I out of expenses, out vouched 1 operated overseas 2 currencies. 3 abroad. 4 p r e p a r a t i o n s to g e t m a r r i e d at s o m e s t a g e a n d t h a t 5 w o u l d h a v e t o t r a n s f e r m o n e y to t h e m . 6 c o n v e r t i n g m o n e y b a c k in to I r i s h p o u n d s t h e r e w a s a 7 c o s t a n d t h e r e w a s a n e x c h a n g e ris k, 8 r e c o n v e r t e d a g a i n to t r a n s f e r m o n e y t h e r e w e r e 9 further costs of exchanges. for l o n g p e r i o d s of t i m e a n d o t h e r I had three children initially working One of t h e m was o b v i o u s l y m a k i n g Always in a n d t h e n if y o u I t h i n k it w a s h e w h o 10 p r o b a b l y said, 11 t h a t w h i c h a r e q u i t e in o r d e r . " 12 t h e m u p f o r you, 13 a n d a l l y o u do is t r a n s f e r t h e m o n e y t o me, 14 k e e p a n a c c o u n t a n d so l o n g as it is s t r i c t l y fo r 15 your children, 16 t r a n s f e r r e d and I will tran s f e r it." 17 over a m a t t e r of mon t h s maybe. 18 34 Q 19 A "well, there are simple ways over He said, "I c a n s et I still have b a n k i n g connections I will y o u t e l l m e w h e n y o u w a n t it Wha t was over a m a t t e r of months, Yes. I That happened these discussions? We m ight have had an initial d i s c u s s i o n and I 20 m i g h t n ' t h a v e d o n e a n y t h i n g a b o u t it f o r s o m e m o n t h s 21 la t e r , 22 35 Q 23 I c a n ' t b e v e r y p r e c i s e a b o u t it. A n y w a y w h a t y o u h a v e t o l d us is a s o r t o f s u m m a r y of a n u m b e r of discussions. 24 A 25 36 Q Yes . Do y o u r e m e m b e r w h e n in 1 9 8 9 t h i s w o u l d h a v e b e e n 26 f i n a l i s e d a nd the first part of the a r r a n g e m e n t 27 ....(INTERJECTION). 28 A 29 37 Q It w a s e a r l y in 1989. The a r r a n g e m e n t was that t here were t hese funds that 10 1 you w ere b e i n g p a i d in s t e r l i n g a nd in other 2 currencies. 3 4 38 Q. 5 A. W o u l d you just tell me what these were? I would have had investments in U K s t o c k s , I would 6 have had dividends from UK stocks and these w o u l d be 7 p a i d in sterling. I w o u l d o b v i o u s l y r e p o r t t h e m in 8 m y tax returns and then I w o u l d have b e e n in the 9 h a b i t s u b s e q u e n t l y of j u s t c o n v e r t i n g t h e m i n t o 10 Irish c u r r e n c y and p u t t i n g t h e m w i t h the rest of m y 11 i n v e s t m e n t s at t h e time . 12 have i n c u r r e d quite h e a v y expenses b e c a u s e we were 13 o u t of t h e c o u n t r y p r o b a b l y f o r s i x m o n t h s 14 y e a r e f f e c t i v e l y d o i n g b u s i n e s s a n d w o u l d be 15 incurring quite heavy expenses. 16 submitted, 17 of t h e m w o u l d h a v e b e e n in s t e r l i n g b e c a u s e we h a d 18 a n o f f i c e in L o n d o n at t h e ti m e . 19 t h o s e w o u l d b e c o n v e r t e d in t o I r i s h p o u n d s a n d 20 re-put into m y account and I w o u l d just use the 21 m o n e y as n o r m a l . 22 money. 23 39 Q. 24 A s w e l l as t h a t I w o u l d of t h e When these were t h e y w e r e in m a n y c u r r e n c i e s b u t t h e b u l k Normally then T h e y w e r e t h e o r i g i n s of t h e T h e c h e q u e w a s p a y a b l e to y o u i n s t e r l i n g f o r expenses and dividends? 25 A. 26 40 Q. 27 A n d dividends, yes. W e r e t h e r e a n y o t h e r d i s c u s s i o n s as t o a n y o t h e r funds that w o u l d go? 28 A. 29 41 Q. No. Onl y those two? 1 2 42 Q. Do yo u remember, i f t h i s t o o k p l a c e i n e a r l y 1989, 3 what w ere the a r r a n g e m e n t s m a d e about g i v i n g the 4 f u n d s t o Mr. 5 w o u l d h a n d t h e m o v e r to h i m ? 6 A. Yes, Traynor? W a s it a r r a n g e d t h a t y o u n o r m a l l y s p e a k i n g I w o u l d be, I wouldn't say 7 erratic, 8 t h e a m o u n t of tim e, 9 w o u l d ge t a c h e q u e a n d t h e n I p r o b a b l y m i g h t p u t it but d e p e n d i n g on m y p r e s e n c e in Dublin and I would draw down expenses. 10 in a n e n v e l o p e , 11 c r e d i t to m y a ccount.' 12 43 Q. 13 A. 14 44 Q. 15 A. s e n d it t o h i m a n d say, 'please That was the expenses. Yes. What about the dividends? T h e d i v i d e n d s w o u l d be, I presume, similar. 16 w o u l d d e p e n d on the size of the div i d e n d s , 17 were small 18 45 Q. I It if t h e y I wouldn't bother. J u s t a l i t t l e m o r e d e t a i l i f y o u can. The d i v i d e n d 19 w o u l d c o m e t o y o u in t h e f o r m o f a d i v i d e n d c h e q u e 20 to you? 21 A. 22 46 Q. 23 A. 24 47 Q. 25 26 29 W o u l d y o u e n d o r s e it a n d g i v e it t o h i m ? Oh' yes. O r if t h e y w e r e small, you w ould not bother doing that? A. 27 28 Yes. No. I can't remember, I m u s t say, h o w m u c h o f it w a s d i v i d e n d a n d h o w m u c h o f it w e r e e x p e n s e s . 4 8 Q. T h e a r r a n g e m e n t w a s t h a t it w o u l d b e a l l h a n d e d o v e r e i t h e r b y e n v e l o p e or b y p o s t o r p e r s o n a l l y , is t h a t 1 2 A. 3 49 Q. 4 5 Internal post mostly. You w o u l d see h i m regularly, so p r o b a b l y y o u h a n d e d it o v e r p e r s o n a l l y to h i m m o s t l y ? A. I wouldn't be a bsolutely sure about that because I 6 g e n e r a l l y t e n d t o d e a l w i t h p a p e r w h e n it c o m e s o n 7 m y de sk. 8 50 Q. 9 T h e i d e a w a s t h a t t h i s w a s to b e a n a r r a n g e m e n t for your children? 10 A. 11 51 Q. Yes. Y o u h a d n o t a n y t h i n g p a r t i c u l a r l y i n m i n d at t h e 12 t i m e as I u n d e r s t a n d it, 13 t h e m a r e g u l a r p a y m e n t o u t o f it? 14 A. 15 52 Q. 16 y o u w e r e n o t g o i n g to p a y No. It w a s t h e n t h e y r e q u i r e d m o n e y a n d y o u r d a u g h t e r was gett i n g m a r r i e d and she w o u l d require money? 17 A. 18 53 Q. Yes. W a s a n y r e f e r e n c e m a d e to t h e i n t e r e s t t h a t y o u w e r e 19 g o i n g t o g e t on t h e m o n e y o r t h a t w o u l d b e g o t o n 20 the money? 21 A. No, I a s s u m e d t h a t as t h e m o n e y w a s e a r m a r k e d f o r m y 22 children, 23 it w o u l d a c c r u e t o them. 24 54 Q. t h a t if t h e r e w a s a n y i n t e r e s t a c c r u i n g , L e a v i n g a s i d e wh o was g o i n g to get the b e n e f i t of 25 it, 26 i n t e r e s t or w h a t the i n t e r e s t w o u l d be? 27 A. 28 55 Q. 29 A. d i d Mr. T r a y n o r n o t t e l l y o u it w o u l d e a r n I w a s v e r y c l e a r t h a t it w o u l d e a r n i n t e r e s t . He m u s t h a v e t o l d y o u tha t, If he d i d n ' t t e l l me, d i d he? I think I would have 1 2 56 Q 3 A 4 57 Q 5 A 6 Y o u a s s u m e d it? Yes . D i d he tell yo u w h a t i n t e r e s t it w o u l d e a r n ? W h a t e v e r w a s t h e p r e v a i l i n g i n t e r e s t i n d e p o s i t s at t h e tim e. 7 58 Q 8 A 9 59 Q D i d h e s a y t h a t o r is t h a t w h a t y o u a s s u m e d ? T h a t is w h a t I w ould have assumed. You assumed that your m o n e y w ould have earned 10 i n t e r es t on w h a t e v e r the p r e v a i l i n g i n t e r e s t rates 11 were on d e posits? 12 A 13 60 Q Yes . C a n y o u r e m e m b e r w h e n e f f e c t w a s f i r s t g i v e n to 14 these arrangements? 15 s o m e sort, 16 A 17 61 Q 18 Yo u p a y h i m o v e r a c h e q u e of do y o u r e m e m b e r w h e n t h a t h a p p e n e d f i r s t ? I s u s p e c t e a r l y 1989. T here a f t e r w o u l d this have bee n a fairly regular matter? 19 A 20 62 Q It w o u l d h a v e b e e n f a i r l y r e g u l a r . A t t h a t tim e, Mr. Ba r r y , had you a personal 21 solicitor who was looking after your personal 22 affairs ? 23 A 24 63 Q 25 A I had, yes, who I w o u l d n ' t see v e r y regularly. W h o was he? I h a d i n i t i a l l y a f i r m in Co. Cork who were cousins 26 of mine, 27 to Dublin, 28 R o a d s t o n e h a d a f i r m of s o l i c i t o r s c a l l e d G e r a r d 29 Scalan & O'Brien and I would have used their offices Callahan. S u b s e q u e n t l y I us e d whe n I came not immediately, but the company 1 2 64 Q. 3 A. 4 65 Q. 5 A. 6 66 Q. 7 For your own p e r s o n a l affairs? Yes. D i d y o u h a v e a p e r s o n a l a c c o u n t a n t as w e l l ? A personal, sorry? A c c o u n t a n t to l o o k a f t e r y o u r o w n i n c o m e t a x affairs ? 8 A. 9 67 Q. 10 A. 11 68 Q. 12 A. 13 69 Q. 14 A. 15 70 Q. 16 A. 17 71 Q. 18 A. 19 72 Q. Yes, I had. S K C n o r m a l l y l o o k e d a f t e r me. Who were they? S t o k e s K e n n e d y C r o w l e y as t h e y w e r e at t h e time. W h o was the p e r s o n in S t o k e s K e n n e d y C r o w l e y ? A m a n c a l l e d Pa t M c D a i d . D i d y o u m e n t i o n t h e s e a r r a n g e m e n t s t o Mr. McDaid? No. O r at a n y t i m e ? No. D i d y o u d i s c u s s t h i s w i t h y o u r s o l i c i t o r at a l l ? No. I w a n t to p u t s o m e d o c u m e n t s t o y o u f o r y o u r 20 comments, 21 J o a n W i l l i a m s to the b a n k c o n c e r n i n g a c h e q u e that 22 yo u h a d g i v e n h e r for lodgm e n t . 23 MR. 24 A. 25 73 Q. 26 A. 27 28 29 BA R R Y ) Mr. Barry. Exhibit T h e f i r s t o n e is a l e t t e r f r o m (SAME H A N D E D TO 1. Yes. I t a k e it y o u k n e w J o a n W i l l i a m s v e r y w e l l ? Yes, I k n e w s h e h a n d l e d Mr. Traynor's personal affairs. 7 4 Q. Y o u w o u l d h a v e k n o w n h e r v e r y we l l , you would have met her regularly when you went into the office? 1 2 75 Q. Y o u se e t h a t l e t t e r t h e r e , did you give the cheque 3 t o h e r or d o y o u t h i n k it w a s a c h e q u e t h a t y o u h a d 4 g i v e n t o Mr. 5 A. 6 Traynor? I d o n ' t t h i n k I w a s in t h e h a b i t o f a d d r e s s i n g t h e c h e q u e s t o Ms. 7 76 Q. 8 A. 9 77 Q. Williams. So y o u w o u l d h a v e g i v e n t h e m t o h i m ? Yes. T h a t is a l e t t e r s i g n e d b y J o a n W i l l i a m s lo d g i n g the 10 e n c l o s e d c h e q u e f o r £ 9 , 0 0 0 s t e r l i n g t o t h e c r e d i t of 11 A n s b a c h e r L i m i t e d core account and the number. 12 W o u l d y o u j u s t l o o k at t h e c h e q u e t h a t t h a t r e f e r s 13 to. 14 photostat 15 out. 16 I n v e s t m e n t s L i m i t e d a n d it is s i g n e d b y you, 17 2? 18 A. 19 78 Q. 20 Yes, (SAME H A N D E D T O MR. BARRY). I am afraid but It is a b a d I t h i n k y o u c a n m a k e it It is f o r a n d o n b e h a l f o f B l u e h i l l Bluehill Bluehill Exhibit Investments. Investments Limited, it is s i g n e d b y y o u a n d it is f o r £ 9 , 0 0 0 ? 21 A. 22 79 Q. Yes. O u r i n v e s t i g a t i o n e s t a b l i s h e s t h a t it is t h e c h e q u e 23 that was e n c l o s e d w i t h the letter, 24 d a t e of t h e c h e q u e ? 25 A. 26 80 Q. 27 Yes, I do. Is it n o t c l e a r f r o m t h e s e d o c u m e n t s t h a t t h e m o n e y was b eing lodged into A n s b a c h e r ' s 28 A. 29 81 Q. d o y o u se e t h e Obviously, yes, account? it is b y Ms. W i l l i a m s . I w a n t y o u to l o o k at a n o t h e r d o c u m e n t . T h i s is a 1 l e t t e r f r o m Mr. 2 bank. T r a y n o r of 7th S e p t e m b e r 1992 to the (SAME H A N D E D T O MR. BARRY) Exhibit 3. 3 4 82 Q. T h e s e a r e i n s t r u c t i o n s t o Mr. R e d m o n d f r o m t h e II B 5 r e f e r r i n g to t h e t r a n s f e r o f £ 3 0 , 0 0 0 t o t h e a c c o u n t 6 a n d t h e n a m e s a r e w r i t t e n in, 7 daughter's name and her husband's name? 8 9 A. 83 Q . t h i s is y o u r T h at's right. It s a y s : 10 "P l e a s e d e b i t cost to A n s b a c h e r L i m i t e d n o . 1 a c c o u n t ." 11 12 The same ac c o u nt 13 A. 14 84 Q. Yes, is gi v e n . I se e t h at . A g a i n t h e r e s e e m s to b e n o d o u b t t h a t t h e a c c o u n t 15 t h a t w a s b e i n g o p e r a t e d b y Mr. 16 behalf was the An s b a c h e r account? 17 A. 18 85 Q. Yes. If w e l o o k at t h e d o c u m e n t s t h a t y o u h a v e s u p p l i e d 19 t o us, 20 d a u g h t e r ' s b an k , 21 A. 22 86 Q. T ra y n o r on your Yes. t h e r e is a c o p y s t a t e m e n t Exhibit (SAME H A N D E D T O MR. from your 4. BARRY). D o y o u se e 1 0 t h S e p t e m b e r 1 9 9 2 in h e r s t a t e m e n t , 23 A n s b a c h e r L i m i t e d credit of £29,990, 24 £30,000; 25 A. 26 87 Q. is it n o t ? Yes. T h e r e is no d o u b t t h a t o n i n s t r u c t i o n s 27 Mr. 28 daughter's account 29 t h a t is t h e from T r a y n o r £3 0 , 00 0 was t r a n s f e r r e d to your from the Ansbacher? 1 Is it n o t c l e a r , 2 o r n o t t h a t t h e m o n e y t h a t y o u w e r e g i v i n g to 3 Mr. 4 account? 5 A 6 89 Q 7 A 8 90 Q 9 A Mr. Barry, t h a t w h e t h e r y o u k n e w it T r a y n o r was b e i n g l o d g e d in this A n s b a c h e r Yes . W h e n did you learn that? W h e n did I learn that? Yes . I c o u l d n ' t s a y w h e n I l e a r n e d it, I just can't 10 answer that question. 11 as I a l r e a d y said, 12 Mahon, 13 offshore businesses. 14 a b o u t t h e d e t a i l s o f it a n d I m o r e or l e s s t r u s t e d 15 hi m in that situation. 16 91 Q I w a s a w a r e t h a t Mr. was c o n n e c t e d w i t h Guinn e s s I u n d e r s t a n d t h at . Beyond that I didn't 18 a c c e p t it, 19 Ansbacher account? 21 92 Q know much I w a n t to k n o w if yo u can h e l p us b e c a u s e it is a b s o l u t e l y c lea r, A & that he r e t a i n e d a c o n n e c t i o n w i t h t heir 17 20 Traynor, and I think you that y o u r m o n e y was l o d g e d in an Yes . W h e n y o u k n e w that , when you would have been aware 22 of t h a t ? 23 I w o u l d have b e e n aware of Guinness 24 w o u l d not have b e e n aware of "Ansbacher". 25 s u b s e q u e n t l y t h a t at s o m e s t a g e I t h i n k w h e r e 26 Mr. 27 & M a h o n C a y m a n that s u b s e q u e n t l y he a n d his p a r t n e r 28 s o l d it t o " A n s b a c h e r " . 29 t h e p r e c i s e t i m e of t ha t . & Mahon, but I I knew T r a y n o r m i g h t h a v e b e e n a p r o p r i e t o r of G u i n n e s s I w o u l d h a v e n o m e m o r y of 1 D i d yo u k n o w t h e n that the m o n e y was p r o b a b l y in the 2 Guinness 3 precisely when 4 position? 5 A 6 94 Q & M ahon Cayman ba n k but you did not know " A n s b a c h e r " t o o k over, T h a t is t h e p o s i t i o n , is t h a t t h e yes. I j u s t w a n t to s h o w y o u a d o c u m e n t . Exhibit 5 (SAME 7 H A N D E D TO MR. 8 a c c o u n t a n d I w a n t y o u t o l o o k at t h i s d o c u m e n t a n d 9 e x p l a i n to y o u t h a t t h e t o p o f t h i s d o c u m e n t , BARRY). It is t h e s t a t e m e n t of the 10 t i t l e of this d o c u m e n t has d e l i b e r a t e l y b e e n t a k e n 11 a w a y a n d I w i l l e x p l a i n to y o u i n a m o m e n t why. 12 w a n t y o u t o l o o k at it a n d w o u l d y o u a g r e e w i t h m e 13 that this looks like a ba n k statement? 14 A 15 95 Q I would, yes. W e h a v e t a k e n o u t t h e t i t l e b e c a u s e w h a t I w a n t to 16 a s k you, Mr. 17 regular, or p e r h a p s not regular, 18 s t a t e m e n t s in that 19 A 20 96 Q 21 22 Barry, is w h e t h e r o r n o t y o u got irregular f o r m w i t h o u t t h e t o p o n i t? No. Was the form that you got not like a b a n k statement w i t h the to p cut off? A It w a s l i k e a b a n k s t a t e m e n t w i t h n o h e a d i n g , 23 suppose, 24 b e i n g cu t off. 25 I 97 Q So r r y , yes, perhaps I t h a t c o u l d b e i n t e r p r e t e d as t h e t o p I a m j u m p i n g a l i t t l e bi t. It w a s 26 l i k e a b a n k s t a t e m e n t b u t it h a d n o t i t l e o n it, 27 h a d n o A I B o r B a n k o f I r e l a n d o r a n y t h i n g o n i t? 28 A 29 98 Q it T h a t ' s right. W o u l d it b e l i k e t h a t ? B a n k s t a t e m e n ts are sim i l a r 1 and differ slightly, 2 that? 3 A. b u t w o u l d it g e n e r a l l y b e l i k e I w o u l d n ' t h a v e d e s c r i b e d it as l i k e t ha t . 4 E s s e n t i a l l y w h a t it s h o w e d w a s t h e i n f o r m a t i o n t h a t 5 I n e e d e d at t h e t i m e w h i c h w a s t o s h o w h o w m u c h 6 m o n e y was on deposit. 7 separate. 8 99 Q. 9 ( E x h i b i t 5) w e h a v e h a n d e d in h a p p e n s to s h o w i n t e r e s t , 10 11 That p a r t i c u l a r one It w o u l d s h o w i n t e r e s t s t a t e m e n t to you, A. Except b u t it l o o k e d l i k e a b a n k d i d it? if m y m e m o r y s e r v e s m e r i g h t a n d I c a n ' t b e 12 a b s o l u t e l y c e r t a i n of thi s, 13 t h a t it w a s h a n d w r i t t e n . 14 100 Q. 15 T h a t is w h a t I w a n t e d t o a s k you. correct because 16 A. 17 101 Q. I had the impression I w o n d e r is t h a t ....(INTERJECTION)? I a m n o t a b s o l u t e l y sure. I am c o n c e r n e d to t r y to a s c e r t a i n w h a t your 18 r e c o l l e c t i o n is, Mr. 19 b u t it d i d n o t g i v e t h e t i t l e o f t h e b a n k ? 20 A. 21 102 Q. 22 Barry. It w a s a b a n k s t a t e m e n t T h a t ' s right. Y o u t h i n k it w a s h a n d w r i t t e n b u t y o u a r e n o t certain? 23 A. 24 103 Q. 25 A. 26 104 Q. I am not certain. V e r y w e l l. Mr. Traynor died very suddenly, I think. Yes. A lot of t h i n g s h a p p e n e d a r i s i n g f r o m his d e a t h but 27 I w a n t t o a s k you, 28 p a r t i c u l a r p o s i t i o n a r i s i n g f rom his d e a t h and the 29 f u n d s y o u h a d w i t h him. f i r s t o f all, about your own Who did you make enquiries 1 2 I made enquiries ultimately from a man called Sam 3 Field Corbett. 4 105 Q 5 A 6 106 Q 7 A Before that who did you mak e them from? I didn't make any enquiries. W h e n you say ultimately? I w a s n ' t q u i t e c l e a r on t h e s i t u a t i o n w i t h t h e 8 a c c o u n t w h e n h e d i e d in 1994, 9 c e r t a i n t h a t t h e r e w a s v e r y l i t t l e f u n d s left, 10 any, 11 107 Q 12 A but I was fairly i n it. I j u s t w a n t to k n o w w h a t y o u did. I t hink I a sked Sam Field Corbett, wh o m I knew 13 b e c a u s e he h a d a contract with'CRH', 14 salaries for the Executives. 15 w i t h Mr. Traynor and I asked what happened. 16 108 Q 17 A to do ce rt a i n He h a d a c o n n e c t i o n It w a s t o h i m y o u w e n t ? Yes. H e said, "I d o n ' t k n o w a n y t h i n g a b o u t it" a n d 18 I think a man called Padraig Collery had taken 19 r e s i d e n c e in h i s o f f i c e s a n d h e said, 20 with him because 21 c a m e b a c k to m e a n d h e said, 22 m o n e y l e f t in y o u r a c c o u n t . " 23 t h a t ." 24 109 Q 25 A 26 110 Q 27 A 28 111 Q 29 if "I w i l l c h e c k I b e l i e v e h e is h a n d l i n g t h a t . " D i d y o u c o n t a c t Mr. "I t h i n k t h e r e is s o m e I said, "I d o n ' t n e e d Collery yourself? No. You never met him? No. W o u l d y o u j u s t l o o k b a c k at t h a t c h e q u e o f £ 9 , 0 0 0 , E x h i b i t 2, t h a t He I h a n d e d in a m o m e n t ago. Do y o u 1 se e t h a t t h a t c h e q u e is s i g n e d b y y o u f o r a n d on 2 b e h a l f of B l u e h i l l 3 Yes . 4 112 Q 5 A What were Bluehill Bluehill Investments? Investments? I n v e s tments was an o f f shore c o m p a n y I t hink 6 in G u e r n s e y or in Jersey, 7 was owned by'CRH' 8 u s e d t o do a c q u i s i t i o n s o v e r s e a s . 9 u n d e r s t a n d w i t h t h e p e r m i s s i o n of t h e C e n t r a l B a n k G u e r n s e y i n fact, which and which was the p r i m a r y vehicle It w a s s et u p I 10 and o p e r a t e d u n d e r the r e g u l a t i o n s 11 Bank. 12 w e r e r e a l l y the b u y i n g a n d s e l l i n g of c o m p a n i e s an d 13 the e f f i ci e n t 14 a tax point of vie w was done from there. 15 expenses 16 have been p a i d from there by the directors 17 "Bluehill". 18 113 Q 19 20 So r r y , of t h e C e n t r a l Costs associated with those investments which f i n an c i n g of t h e m f rom an in te r e s t and Any incurred with those actual operations would I d i d not c a t c h the e n d of that. of Expenses, whose expenses? A For example, I m y s e l f p l u s a n u m b e r of t h e o t h e r 21 exe c u t i v e dir e c t o r s w o u l d be i n v o l v e d in t r a v e l l i n g 22 a n d w o u l d h a v e b e e n s p e n d i n g c o n s i d e r a b l e t i m e s in 23 E u r o p e a n d in t h e U n i t e d S t a t e s w o u l d b e i n v o l v e d in 24 actually incurring expenses, 25 t o t a l l y r e l a t e d to t h e b u y i n g a n d s e l l i n g of 26 companies. 27 a c er t a i n amount of e n t e r t a i n m e n t a nd all the usual 28 t h i n g s w h i c h go w i t h it. 29 114 Q m o s t of w h i c h w a s It i n v o l v e d t r a v e l e x p e n s e s , Are these expenses of'CRH'? it i n v o l v e d 1 2 115 Q 3 I n v e s t m e n t s p a y i n g t h e e x p e n s e s of 'C R H '? 4 A 5 116 Q It w a s a c o s t to " B l u e h i l l Investments", yes. I j u s t w a n t to u n d e r s t a n d b e c a u s e ....(INTERJECTION). 6 7 A 8 117 Q 9 T h e e x p e n s e s w o u l d h a v e b e e n i n c u r r e d b y me. O f c o u r s e b y you, I j u s t w a n t to u n d e r s t a n d w e r e t h e y i n c u r r e d b y y o u o n b e h a l f of 10 A 11 118 Q On b e h a l f of 'CRH', A 14 'CRH'? yes. The a r r a n g e m e n t was that t hese ex pe n s e s w o u l d be paid by "Bluehill 12 13 Was Bluehill Yes, Investments"? w h e r e t h e y p a r t i c u l a r l y r e l a t e d to the w or k o u t s i d e of Ireland. 15 119 Q 16 A 17 120 Q 18 A n d other expenses, Yes, w h i c h we p a i d domestically. W e r e all y o u r e x p e n s e s o u t s i d e of I r e l a n d p a i d b y "Bluehill 19 A 20 121 Q of c o u r s e ? N o t all, Investments"? the great majority. So t h i s c h e q u e ( E x h i b i t 2) for £9,000 was a cheque 21 for expenses 22 p a i d f o r b y " B l u e h i l l I n v e s t m e n t s " a c c o r d i n g to 23 these a r rangements that were made. 24 sec o n d s i gnature on that cheque and I w o n d e r can you 25 t e l l us w h o t h a t 26 A 27 122 Q 28 A 29 123 Q i n c u r r e d b y y o u o n b e h a l f of 'CRH' and T h e r e is a s i g n a t u r e is? I a m n o t a b s o l u t e l y sure. Is it Mr. Field Corbett? It c o u l d b e a c t u a l l y , W a s Mr. yes. F i e l d C o r b e t t i n v o l v e d o r a s s o c i a t e d in t h e 1 company "Bluehill 2 W a s Mr. 3 Investments", 4 124 Q 5 A Investments"? Corbett associated with "Bluehill I can't remember. He m u s t h a v e b e e n on t h e b a n k ....(INTERJECTION). He m a y h a v e b e e n t h e o p e r a t o r o f a b a n k a c c o u n t 6 w h i c h was part of "Bluehill" and an a p p r o v e d 7 signatory. 8 125 Q 9 A T h a t is w h a t Yes, I w ould have thought. he w a s a n a p p r o v e d s i g n a t o r y , yes. 10 say involved, w a s h e an e x e c u t i v e of, 11 he e v e r was. I a m n o t sure. 12 126 Q 13 A 14 127 Q 15 A 16 128 Q 17 I don't think He w a s an a p p r o v e d s i g n a t o r y o n t h e a c c o u n t ? Yes . W h e n Mr. T r a y n o r die d, then you c o n t a c t e d him? Yes . H a d y o u t a l k e d to h i m p r i o r t o Mr. Traynor's death about this arrangement? 18 A 19 129 Q 20 A 21 130 Q No. A f t e r Mr. 23 A 24 131 Q 25 T r a y n o r ' s d e a t h y o u t o l d h i m a b o u t it? Yes . He t h e n t o l d y o u t h a t Mr. Mr. 22 26 When you Yes, Field Corbett's own office? t h a t ' s right. W h a t was the n a m e of t h o s e offices, W a s it M a n a g e m e n t A 27 C o l l e r y h a d m o v e d to Management do you remember? Services? Information Services, yes. I t h o u g h t it w a s t h e a d d r e s s y o u w e r e l o o k i n g for. 28 132 Q No, Management 29 A The " M I S " w e r e c o n t r a c t e d to Information Services. 'CRH' from some time 1 before 2 the senior executive payroll. 3 133 Q 4 I became Chief Executive, W h e n he m a d e e n q uiries, e f f e c t i v e l y to p a y you must have then known t h a t t h e m o n e y w a s in " A n s b a c h e r " at t h i s 5 A 6 134 Q 7 Yes, "Ansbacher" It w a s stage? or w h a t e v e r . in t h e o v e r s e a s b a n k t h a t f o r m e r l y h a d b e e n owned? 8 A 9 135 Q T h a t ' s right. The m o n i e s that w e r e p a i d out a f t e r the d e a t h of 10 Mr. 11 of a n o t h e r c o m p a n y c a l l e d H a m i l t o n R o s s L i m i t e d , 12 you know about 13 A T r a y n o r w e r e in f a c t p a i d o u t f r o m t h e a c c o u n t did "Hamilton Ross"? I never knew about "Ha m i l to n Ross". The first 14 reference 15 it w a s m y s o n e v e n t u a l l y g o t c o p i e s of h i s b a n k 16 s t a t e m e n t s or m y d a u g h t e r a n d one of t h e m was s h o w n 17 with the name 18 136 Q 19 A 20 137 Q I came across " H a m i l t o n Ross". You ha d not h e a r d that? No. Y o u w e r e n o t t o l d b y Mr. F ield Corbett that the m o n e y had be e n m o v e d into another account? 21 22 A 23 138 Q 24 A 25 139 Q No. Y o u a s s u m e d it w a s I did, s t i l l in " A n s b a c h e r " ? yes. The m o n e y you knew was on deposit, 26 on d e p o s i t 27 by Guinness 28 interest? 29 " H a m i l t o n R o s s " is I t h i n k y o u k n e w it w a s in t h e o v e r s e a s b a n k w h i c h h a d b e e n o w n e d & Mahon, no t a x w a s p a i d o n t h e 1 W h e n you a p p r o a c h e d the Revenue about the matter, 2 was the s e t t l e m e n t m a d e on the b a s i s t h a t a r r e a r s of 3 t a x a n d / o r p e n a l t i e s w e r e in r e l a t i o n t o i n t e r e s t 4 only? 5 A 6 141 Q Interest, yes. Y o u w e r e n o t t a x e d on a n y o f t h e p a y m e n t s . You 7 s a t i s f i e d t h e R e v e n u e t h a t y o u w e r e n o t l i a b l e fo r 8 a n y a r r e a r s of t a x on t h e s u m s ? 9 A 10 142 Q 11 A 12 143 Q 13 14 Absolutely, yes. So it w a s on a r r e a r s of i n t e r e s t ? Yes . I t a k e it, Mr. Barry, that yo u h a d not a v a i l e d of t h e t a x a m n e s t y in r e l a t i o n t o t h i s ? A No, it w o u l d h a v e m a d e n o s e n s e b e c a u s e 15 m o n e y for m y c h i l d r e n offshore, 16 MR. JUSTICE COSTELLO: I n e e d e d the n o t b a c k her e. T h a n k y o u Mr. Barry. 17 18 E N D O F E X A M I N A T I O N O F MR. 19 COSTELLO 20 21 22 23 24 25 26 27 28 29 B A R R Y B Y MR. JUSTICE 1 2 M S . MACKEY 3 4 MS. MACKEY: If I c o u l d j u s t a s k y o u a 5 l i t t l e bit, Mr. Barry, 6 a bout the c o m m e n c e m e n t of this a r r a n g e m e n t w h e n you 7 f i r s t a p p r o a c h e d Mr. 8 as I u n d e r s t a n d it, 9 o v e r t h e c h e q u e s to h i m a n d h e w o u l d l o o k a f t e r 10 them, 11 A 12 145 Q 13 14 Traynor. He s u g g e s t e d t o you, I think you said you would pass I think those were your w o r d s . Yes . W h a t did you u n d e r s t a n d he was g o in g to do with t h o s e c h e q u e s at t h e t i m e ? A I u n d e r s t o o d that he was g o i n g to p ut the m o n e y - ­ 15 in o ther words, 16 o n - s h o r e to I r e l a n d w i t h t h e c o n v e r s i o n etc. 17 t hen the reconversion, 18 offshore. 19 was on deposit. 20 w o u l d b e k e p t at t h e t i m e a n d it w a s o b v i o u s l y g o i n g 21 out in tranches. 22 w o u l d b e t r a n s f e r r e d to m y c h i l d r e n at a t i m e I 23 deemed appropriate. 24 146 Q 25 A 26 147 Q it w a s n ' t g o i n g t o b e b r o u g h t b a c k and t h a t it w o u l d b e h e l d It w o u l d o b v i o u s l y e a r n i n t e r e s t i f it I wasn't sure how long the m o n e y It w a s m y w i s h t h a t t h a t m o n e y So y o u u n d e r s t o o d t h e m o n e y w o u l d b e h e l d o f f s h o r e ? Yes . Y o u w e r e a w a r e at t h a t t i m e t h a t Mr. Tray n o r was 27 c o n n e c t e d w i t h the o f f s h o r e s u b s i d i a r y of G u i n n e s s 28 Mahon? 29 A & 1 148 Q 2 It w o u l d h a v e b e e n r e a s o n a b l e to s u p p o s e t h a t it w a s there that the m o n e y w ould be held offshore? 3 A 4 149 Q 5 A 6 150 Q 7 A Yes . Y o u d i d in f a c t u n d e r s t a n d t h a t t o b e t h e c a s e ? I did. At the time that you c o m m e n c e d the a r r a n g e m e n t s ? Yes. L e t m e a d d t h a t I d i d n ' t se e a n y t h i n g u n u s u a l , 8 I t r u s t e d Mr. 9 area. 10 151 Q Traynor's H o w d i d you t h i n k this m o n e y was g o i n g to be held? 11 What 12 ....(INTERJECTION). 13 A 14 152 Q 15 16 k n o w l e d g e of t h a t w h o l e form did you think the arrangement I a s s u m e d it w o u l d be h e l d i n s t e r l i n g . D i d y o u u n d e r s t a n d it w o u l d b e p u t i n t o a n a c c o u n t or w h a t d i d you assu m e ? A 17 I a s s u m e d it w o u l d b e p u t i n t o a n a c c o u n t j u s t l i k e a deposit 18 153 Q 19 A 20 account. In w h o s e n a m e d i d y o u s u p p o s e it w o u l d b e h e l d ? I a s s u m e d it w o u l d h a v e b e e n t h e n a m e deposit account 21 154 Q 22 A in t r u s t 'Barry 'as a for children. In t h e n a m e A n t h o n y B a r r y ? I h o n e s t l y c a n ' t r e m e m b e r w h e t h e r it w a s A n t h o n y 23 B a r r y or w h e t h e r I w o u l d h a v e s p e c i f i e d m y c h i l d r e n 24 at t h e tim e. 25 155 Q 26 A 27 156 Q 28 A 29 157 Q D i d y o u s i g n a n y d o c u m e n t s to o p e n t h i s a c c o u n t ? No. Did your children sign any documents? To m y knowledge, no. How did you u n d e r s t a n d the m a tter was being 28 1 arranged? 2 A 3 158 Q I j u s t t r u s t e d Mr. Traynor implicitly. In t h e a f f i d a v i t t h a t y o u s e n t t o us w h i c h y o u s w o r e 4 s o m e t i m e ago, 5 it t h e r e in f r o n t of you. 6 A 7 159 Q 8 I do, yes. If I c o u l d r e f e r y o u to p a r a g r a p h 3 of t h a t affidavit. 9 A 10 160 Q I d o n o t k n o w if y o u h a v e a c o p y o f Yes, Exhibit 6. I h a v e it he r e . I d o n o t k n o w if it is p a g i n a t e d l i k e m i n e , b u t at 11 t h e b o t t o m of p a g e 2 o f t h e a f f i d a v i t o n m y c o p y y o u 12 say: 13 "... I a l w a y s a c c e p t e d t h a t m o n i e s so d e p o s i t e d w i t h Mr. T r a y n o r w o u l d be a p p l i e d b y h i m e x c l u s i v e l y for the b ene f i t of m y two n o n - r e s i d e n t c h i l d r e n and that any Exchange Control R e g u l a t i o n s w h i c h a p p l i e d w o u l d be c o m p l i e d w i t h in t h e n o r m a l w a y . . . " 14 15 16 17 18 A 19 161 Q Yes . W h a t l e d y o u to b e l i e v e t h a t t h e E x c h a n g e C o n t r o l 20 Regulations would be complied with? 21 t h i s m a t t e r w i t h Mr. 22 A Traynor? I t r u s t e d h i m and he a s s u r e d me that this w hole 23 thing could be done quite simply and 24 straightforwardly. 25 162 Q 26 A 27 163 Q 28 A 29 Did you discuss Did you specifically discuss ....(INTERJECTION)? Exchange controls? Yes . No, not that I think I remember. T h e r e w a s no specific d iscussion about exchange control. 1 W h e n the notes on h e a d e d paper, 2 to i n t h e n e x t s e n t e n c e a n d w h i c h w e h a v e t a l k e d 3 about already, 4 Mr. 5 o ther than the stat e m e n t of y our ac c o u nt ? 6 ask him where they came from? 7 A 8 165 Q 9 A 10 16 6 Q 11 Traynor, which you referred w e r e s e n t to y o u f r o m t i m e t o t i m e b y did you ask hi m what these represented Did you No. Y o u n e v e r d i s c u s s e d t h e m a t t e r w i t h h i m at a l l ? No. Y o u d i d n o t a s k h i m w h y t h e r e w a s n o n a m e of a b a n k on top? 12 A 13 167 Q 14 A No. Did this puz z l e you? Not really because I a s s u m e d t h a t a l l of t h i s w a s 15 h a p p e n i n g o f f s h o r e in t h e C a y m a n I s l a n d s a n d t h a t 16 Mr. 17 The o n l y i n f o r m a t i o n I n e e d e d was a b a l a n c e b e c a u s e 18 (a) I d i d n ' t w a n t t o p u t t o o m u c h m o n e y i n t o it, 19 (b) at s o m e s t a g e t h a t b a l a n c e w a s g o i n g t o b e 20 transferred. 21 168 Q Tr a y n o r w o u l d p u r e l y have access to balances. Right. M o v i n g on further down your affidavit, 22 talk about the payments 23 it is t h e n e x t p a r a g r a p h , 24 25 you s u b s e quently being arranged, p a r a g r a p h 4 at (b): "Payments b e i n g a r r a n g e d a fter the d e a t h o f Mr. T r a y n o r to Mr. S a m u e l F i e l d C o r b e t t ..." 26 27 We have already talked a little bit about how you 28 a p p r o a c h e d Mr. 29 and Field Corbett. 1 169 Q 2 He m a d e e n q u i r i e s fo r y o u f r o m Mr. s t a t e of y o u r a c c o u n t ? 3 A 4 170 Q I believe, yes. Y o u w e n t a l o n g to Mr. Corbett because you were 5 anxious, 6 to y o u r a c c o u n t a f t e r Mr. 7 right? 8 A 9 171 Q 10 11 C o l l e r y about the you d id not know what was g o i n g to h a p p e n Traynor's death; is t h a t Yes . W h y d i d y o u d e c i d e to g o to Mr. Field Corbett, not clear about that? A I knew that he h a d a ver y close r e l a t i o n s h i p with 12 Mr. 13 In f a c t a c t u a l l y m o s t o f t h e m o n e y h a d g o n e o u t 14 b e f o r e Mr. 15 m y memory. 16 of h i s c l o s e n e s s w i t h Mr. 17 172 Q Traynor. I got the dates w r o n g on m y affidavit. T r a y n o r died, b u t t h a t j u s t h a p p e n s to b e I think I might have asked him because conversation went? 19 a n d yo u s a i d to h i m w h at? A Traynor. C a n y o u j u s t t r y to r e c a l l 18 20 I am I said, f o r us h o w t h a t Y o u c o n t a c t e d Mr. " b y t h e way, Sam, Field Corbett I don't know but I believe 21 I s t i l l m a y h a v e a n a c c o u n t a n d it w a s o p e n e d w i t h 22 Mr. 23 He said, 24 y o u ." 25 173 Q 27 A 28 174 Q 29 Do y o u k n o w h o w t h e s e t h i n g s w o r k e d ? " "I d o n ' t know, but I w i l l f i n d o u t fo r Y o u d e s c r i b e d it as a n a c c o u n t t h a t w a s o p e n e d w i t h Mr. 26 Traynor. Traynor? Yes . Y o u e x p e c t e d t h a t he w o u l d k n o w w h a t y o u w e r e talking about? 1 I didn't, 2 to. 3 175 Q 4 A I e x p e c t e d t h a t h e w o u l d k n o w w h o to t a l k W h a t l e d y o u to t h i n k h e w o u l d k n o w w h o t o t a l k t o ? I s u p p o s e h i s c l o s e n e s s w i t h Mr. Traynor, but he was 5 n e v e r i n v o l v e d at a n y s t a g e w i t h m e i n t h e o p e n i n g 6 of t h e a c c o u n t w i t h Mr. 7 176 Q M o v i n g on f u r t h e r d o w n t h a t s a m e p a r a g r a p h ....(INTERJECTION). 8 9 Traynor. A I cou l d n ' t be a b s o l u t e l y sure n o w that I t h i n k about 10 it w h e t h e r h e m i g h t n ' t h a v e c o m e t o m e a n d said, 11 t h e way, 12 a c c o u n t w h i c h Mr. 13 s u r e w h i c h w a y it we n t . 14 177 Q 15 A 16 178 Q W h i c h Mr. I t h i n k y o u m a y s t i l l h a v e s o m e m o n e y i n an Collery told me a b o u t . ' I am not Collery told him about? Or m i g h t h ave to l d h i m about. M o v i n g on d o w n t h a t p a r t i c u l a r p a r a g r a p h , 17 p a r a g r a p h 4, 18 t h a t w e r e c a r r i e d o u t o n b e h a l f of y o u r c h i l d r e n 19 t h e r e i n t h e l o d g m e n t s a n d so on, 20 t a l k a b o u t a t r a n s f e r o f a s u m to t h e a c c o u n t of 21 y o u r s o n P a u l in t h e S t a t e s . 22 A 23 179 Q 24 25 you relate the different transactions a n d at (ii) you Yes . How was that arranged? Mr. A 'by Yes, Traynor, This was a f t e r the d e a t h of w a s it n o t ? I t h i n k I w o u l d h a v e g o n e to Mr. Field Corbett 26 a n d a s k e d h i m w h a t e v e r c o n n e c t i o n s he h a d c o u l d h e 27 arrange that transfer. 28 29 180 Q A l t h o u g h y o u k n e w at t h i s s t a g e t h a t Mr. in fact d e a l i n g w i t h the matter, C o l l e r y was y o u c h o s e to 1 a p p r o a c h Mr. Field Corbett? 2 3 181 Q. 4 A. He w a s h a p p y t o a c t as s o m e k i n d of g o - b e t w e e n . He w a s h a p p y to d o that, yes. Sor ry , 5 b y t h e w a y at t h a t s t a g e t h a t Mr. 6 a r o o m at Mr. 7 t o l d me. 8 182 Q. 9 10 11 12 13 No, Traynor? I d i d n ' t give a n y c h e q u e s to a n y b o d y after, think, 183 Q. 14 D i d y o u t h e n g i v e a c h e q u e to F i e l d C o r b e t t as y o u w o u l d h a v e d o n e i n t h e p a s t t o Mr. A. Collery had taken F ield Cor b e t t ' s offices b e c a u s e he had How was this done? Mr. I had learned about I 1992. So the t r a n s f e r was s i m p l y m a d e f r o m ....(INTERJECTION). 15 A. 16 184 Q. 17 The t r a n s f e r was simply m a d e from the account. T h e n at p a r a g r a p h 5 y o u t a l k a b o u t t h e c l o s i n g o f your a c c o u n t . 18 A. 19 185 Q. 20 Yes. W h e n Mr. S a m F i e l d C o r b e t t g a v e y o u a s u m of a b o u t £4,000. 21 A. 22 1 8 6 Q. 23 A. Yes. H o w d i d t h a t c o m e a bo ut , in w h a t c i r c u m s t a n c e s ? I t h i n k I p r o b a b l y s a i d t o h i m at t h e time , 'look, I It h a s d o n e w h a t I 24 don't want this account anymore. 25 i n t e n d e d to do w i t h it. 26 i n it, 27 said, 28 i n it.' 29 D u b l i n w i t h h e r h u s b a n d at t h i s s t a g e h a v i n g b e e n If t h e r e is a n y t h i n g l e f t w e b e t t e r c l e a r it o u t a n d c l o s e it.' He ' t h e r e is t h a t m u c h m o n e y l e f t a p p r o x i m a t e l y M y d a u g h t e r a c t u a l l y h a d c o m e b a c k to 1 s e v e n or e i g h t y e a r s a b r o a d , 2 t h e r e c i p i e n t s o f w h a t e v e r m o n e y w a s i n it, 3 t r a n s f e r r e d it to h e r w i t h s o m e a d d i t i o n a l m o n e y I 4 g a v e her. 5 187 Q What m o n e y c a m e to you. 7 it to y o u ? A 9 188 Q 10 A 11 189 Q 12 13 14 D i d Mr. 190 Q 16 A 17 191 Q 18 A I b e l i e v e it w a s in c a s h i n fact. He h a n d e d it t o y o u in c a s h ? Yes . Can you recollect where that happened? I can't. W a s t h i s in your office? I w o u l d n e ve r h ave b e e n in his office, so S o h e h a n d e d y o u I R £ 4 , 0 0 0 in c a s h ? Yes, or a p p r o x i m a t e l y . In a n e n v e l o p e o r w h a t e v e r ? Yes . MS. MACKEY: I t h i n k t h a t is a l l t h e 20 21 Sam Field Corbett hand it m u s t h a v e b e e n i n m y o f f i c e at s o m e st a g e . 15 19 He did, his office, A I I w a n t to g e t c l e a r h e r e is i n w h a t f o r m t h i s 6 8 so as t h e y w e r e to b e questions Mr. Barry, I have , t h a n k you. 22 23 E N D O F E X A M I N A T I O N O F MR. B A R R Y B Y MS. MACKEY MR. T h a t is e v e r y t h i n g , 24 25 JUSTICE COSTELLO: 26 Mr. Barry. Just formally 27 we b e t t e r get yo u to i d e n t i f y the aff i d a v i t , 28 6, a n d t h e d o c u m e n t s t h a t y o u s e n t i n w i t h y o u r 29 affidavit j u s t as an e x h i b i t , Exhibit 7. Exhibit 1 2 192 Q. 3 A. 4 193 Q. 5 6 If y o u w o u l d i d e n t i f y t h o s e . Do I sign t hem? No, it is n o t n e c e s s a r y . h a n d t h e m b a c k to Ms. A. 7 MR. JUSTICE COSTELLO: completed. A. T h a n k you. 12 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Barry, t h a n k y o u fo r w o u l d l i k e y o u to s i g n t h e t r a n s c r i p t w h e n it is 10 14 Mr. c o m i n g t h i s m o r n i n g a n d we 9 13 Cummins. Yes. 8 11 If y o u i d e n t i f y t h e m a n d END OF INTERVIEW SOKULHP Lg 9x000 Ansbacher Limited A Mtntbtr o /th t Htnry Ansbachtr Holdings tL C Merchant Banking Group P.O. Box 187, G n a d Cayman, British W « i ^ .-Phon« (809) M9-W533/4 Telex; C P 4303 . Fa* (809) 949-7946 (K»)l 949-3267 Please reply to: 42 Fitzwilliam Square, .Dublin 2. Tel: 763144/763065 Fax: 612035 26th February, 1991. Garrett Logan, Esq., Irish Intercontinental Bank Limited, 91 Merrion Square, ' ■ DUBLIN 2. ’ Dear G a rre tt, C o u ld y o u p l e a s e a r r a n g ^ t e t f 'i o d g e t h e e n c a s e d c h e q u e f o r S t a E 9 . 0 0 0 . 0 0 t o c r e d i t o f A n s b a c h e a ^ & in iifc e d C a l l A c c o u n t No. 0 2 /01087/81 Y o u rs \ s in c e r e ly ,\ ■ <*** t Ucouj (/ p.* <* V. . ___ ' \ For ANSBACHER LIMITED \ JDT/AJW V ’ ' * V®6 * \ (I V '** S* ' -*»!t c V -s«i . ..... • • - . xv? (aim) '«fVr j**.. •illf**- — • \ -vka.u...*: ‘ Ski'* «£ \ . / \ * r# : V* s'-’; V‘, " Z ! £ * r V. • •.;•• / ... / ..-. ><•.: " X y 4 ~ r ••■* c.-. w...*4 • Ansbacher Limited Please reply to: 42 Fitzwilliam Square, Dublin 2. . Tel: 765144/763065 R u e 612033 % P.Q. Box 887. Gnod Cayman, Caynurn Islands, British West Indies Telephone: (809) 949*8655 Telex: CP 4305 ‘ Facsimile (809) 949-7946 (809) 949*5267 7th September, 1992. 'U r . S o n u Redmond, I r i s h In te rc o n tin e n ta l Bank L t d . , 91* M a rrio n Square, D u b lin 2 . ■ • Dear Reman, I would be grateful if 70 U would transfer 6tg£30,000.00 to Bank o f Ire la n d (J a r a a y ) L t d . , P .O . Box 416, T e n p la r House, . Don Road, S t . B e li e r , . — J e r s e y - JB48W2, • Channel Xsla&da. • -■ Account H i^e v«^ffll0 6 7 il3 ix-.* ^w x . J • fio'v^e Please d e b it coat to Ansbacher U n i t e d *s Ho . Please advise vhen funds v i l l be i n p la c e . Yours s in c e re ly , S/arj. ' ' I 1 - - 1 ‘ 4 nmi iBnrVowiiF' ' I " D«ua» / b ' f b o c & i L i wwwmw lArdnrinriHW > Q 2 u i J o wccod>i Wh.21 I' . , £oouLS. ^ ^ boiiciEcrs O'Flynn Exhams & Partners 56 South Mall. C-ork. TfjU?phui’ .u (02!) '127 77C3 Fai;oiiniit> (02!) -i27 2117 Email: :)fo;1 0 1 . Ihereby certify the signature O f &'•< Jb H rf « 3 > E » e K d ?/ iC K i AT Identified by u k X & w r q < i c c K c e t at. £KizcF\2cfi which was/were subscribed to this document today in m y presence __ ' London, the 2 d day of c/want 20 01 < n> W Z ^ 3 ?-----------* ________ Notary Public London D.N.L. FAW C E T T Scriven er Notary of London, Fnr>f"~rf 63 >■ .■ <■ '■ ■ '■ . •>•... ■ ■ ■ ■ '.."'...‘ 3 :u >.s • ? 2 ^ 2 7 0 . _ 00j.^ iCy-7 3 ■ i C j D e b i t e d ’!. G .M 'iC .T vi., VS^:;-S T G £ 3 > 0 0 0 . 00'. r e f e r e n c e b y:. Mr;,1::. B i r k i i & l n ; . L o n d o n i s ^ : . ^ ^ c a s h ';V'.>':;H-:';.- , '••'■4 )flW “c f e ^ itS d '- ' G »M'. C', T i& ’.S I. :S T G £ 3 , 0 0 0 ’v 00- d e b i t e d . G . M . ”1 ^ % . u ’^ .**,'■'■ j ■ * £? * ]? « C a . » » ** ^ ^810»00^ » » » » » * * * :•• » 'V' ’o —^ 'rV :'i'-',* 'n4 « ^ ''” . ".': V'.:'U':/';' v . ''' ^'••, '■1■ j .. .. •''. ■■ i. ■ ' l ‘ ‘..' -Sy ' •O r—s . ; •'“ ■ {••v■ *'■ ***"fi•*': * * * i .. • •• / ’16th Jabruary, 1982, A.J.H.'to D-.P.C.' ".i'' .V,'; . / •'•. ••" C o u ld y o u p l e a s e a r r a n g e t o t r a n s f e r tw o a m o u n ts o f U . S . 5 1 , 7 5 0 e a c h t o : - ..... •• 1 • . • ' • - B an k er a' T r u s t C o m p a n y ,. • 18 W a ll- B t r e e t , "Hew Y o r k •• ; ' ' ' ■ • ’ '■ ‘ • ■ . i o r c r e d i t o l Domniclc I n v e s t o r s C o r p o r a t io n A c c o u n t H o. 00801625:.. ; : 9 1 7 8 0 t o ba c r e d i t e d t o M r . . J.DV" B i r k i n ’. a . A c c o u n t H o .0 0 3 8 0 8 8 1 7 9 an d S 1 7 S 0 t o b e c r e d i t e d t o VK. A c c o u n t H o .0 0 3 6 8 5 2 1 7 9 . ' . ' : .• v v ■ »• ‘ I t I s a p p a r e a .t ly . I m p o r ta n t - t h a t t h e tw o am o u n ts o f $17SO b e l n Hew Y o r k . n o t ' l a t e r th a n F r id a y o f t h i s ' w e e k . ' . . a ;,. • . ' One am ount o f . $1750 s h o u l d b e ' d e b i t e d t o G .V .C .T . ' A c c o u n t H o . 15816/09/68. an d t h e - o t h e r t o 6 . K . C . T . A c c o u n t~ H o . 20738/03/68. • ‘ ' . . ■' . . -, Fran. .4 I .,:srr 9'll}. 1" ?2 a, 34?s.: 5" zorz?uz 'vll~ .- . .en?a-x? "canet. ?Luca MIKE323and". Ii"! 1. ,.@5533; ?lu - .a - 3" enEKYEWIEL .0 I ?sis g. h. aims?va sunshine? FWIGUW 1? ?autumn-naming Mumth and Isak {Ll-null! 0! Cl: M- 2011h?2 . A/C No. '■ • ■ ' . ' Transfer Stamp 36.00 - ■' Commission . 27.00 TOTAL Value Date 25 /5 /3 1 ' - ------------- £ 1 / 9 6 3 . 0 0 . STG For GUINNESS + MAHON LTD.' ^ , 4 C ----------------- rg flH ^ tRv b #•- £ S7it-if-x:-c *£•fe?&A$raff£&£'■ le&s&sstiusssis- r-T,i !v •-> 3 j» * A J a aN, o o ?w O rM G> O > U4 '3 i V : .• # .3 > .'ilX • '■• iHJ*’• ■uj>:5.■r“i•;5;•“*■. 251- ' < 3 5 a »• 3ai 3 >• 4 *>» SwcStfSf.: , : - A4 ^ H# ^ “)S 1 » » » ^ ^ »• *"> ^ i« »"> •* ^ A 5* > » ■» * * J*> JM » vd ^ ;!d V' ■ ’•-,•'•• *-:v-.................. *!%•<••» * .. vi-'MV ***?>’•'1;?** "* *•- . .' *' l i ' > «.* I.* '-'*'! * i‘•%l*Cl•»«■ l f*^.1L l& gm‘ L j;y» AS iU o o *• 1*1 a at *c % •V* V* ** 2 2 • -.»■i.i!ci.rv, *» =J «** o tA . 3jr ** 5» .•2T- - ^ 3 •' •• tiv.n-vr-jt-.:. • •• ; ' i*/>4'r:l[v5ltpi3^v'>,>,2L-s-'V*e'*l !‘ o i»»*» J* .: : ‘ 33 «2 *.*' a ar *c 3C - tV f ». > u 3 tJ X X 3 U X u ui a a■MoA « M> »W <» 3 2 £ •« 5* * M3 3 uuu>3 O j . >- M « <( < 3 a it at x »* ■» ' •‘ • .» a » » a* 3» > > l. ■■* t * 4 3 2 1 O /V « □ ps®5B®, j5t p-*. ^ r »• <*■* s* 3» •. . ® o ft**M7U*1 ‘M o 40 o I 9 4 V' N > » *y *40 ? -^00 '& *3 a j < 09 % •% * y» yi* >* t o 90 «». X ■'“ ■ s i P * W* " ^•• Z i 4f&^**v*. '*.•- 2 1 - *y.&F•J# P% ??>;*• *~ 1 o •*. v* a t 8 «>V *Vi //V3'/ " >* W* 36 < St -4- o 2 * O & w a UJU* 2 2 »* » ^ O a 2* a *-i O 2 0 5& « U §5 U SI 32 MUK j^ O O ^ s » 2 zw ft 4 < I J 3 * U iJv tU * X *• 4 M*il ,Ui ® _i j» >- a ^a ya a4 a4 3a. d e 3) * . - * * < * ? < >. 1 1 i i © -/I 9 .? □ S ff-V J293% 303+ 4 3 0 5 GMCT CP 2 3 2 0 5 -MARS E l 1 GUINNESS MAHON CAYMAN TRUST 1 GUINNESS*MAHON L T D DUBLIN < 21/J/flJ ro* '.FROM * ' A T T N tv MIKE SHIELD MIKE YOU SHOULD RECEIVE ALL THE STATEMENTS THIS''MORNING PLEASE SEE DETAILS OF A /C UHICH I. OMMITED- TO ENCLOSE. r • • . ' ! G .M .C .T . i 2 " . .. . ’ 'J •; • '4 8 , '9+ 6-43 CJf j . # » 9 2 6 -2 7 '• 3 4 7 - 6 7 \CR- • J / J *2 C ” 6 ,2 3 8 - 1 6 CR ' 8 / 3 PURCHASE DM 120> 730 30* 0 0 0 - 0 0 . OR . (jT t4 /3 *2 * 3 17 3 0 -0 0 CR -. ' SALE OF D.M., FROM FREE FUNDS INTEREST * 23/2 . ~VJ. ‘ BALANCE ii » 4 2 a -5 j' 1 2 /I 2 3 t 3 2 7 -9 6 BALANCE i2 9 T ^ . • ’ b a l a n c e FORUARD LOOSED 7 /2 /6 3 PURCHASE DM iA/2 SALE OF DM 2 5 /2 INTEREST —V J ’ : TO i 2 C •• 3 /3 FROM i 2 C .V V • ■ 4 V* CR CR 1 DR err CR DR CR . 2 9 ,3 8 4 - 0 0 BALANCE .» 7 3 i 2 9 3 •64 3 9 6 ■88 7 3 ,8 9 0 - ■32 7 3 t 4 t 9 -64 6 7 6 -08 74*093 -7 0 2 9 i 384 100 • . /n / > k . ... Ui t N i ^LOJi yv A r i kj i \ i i' FACSIMILE TRANSMlgSlQM TELEFAX llfls 6796242 INTERNATIONAL TELEFAX: )&Mahon Lid OrNn FAX NO. 004471 982 92S2 ATTENTION SANDRA BRADSHAW. FROM MARTIN LANI6AN-0'ICEEFFE. DATE Japhorw B700S44 353-1-6796242 GUINNESS MAHON ft CO. LTO. T*>. !&• * . No. of Pages ‘ 21ST DECEMBER 1993. 1 (Including this page). 0730048 W7 JbhOoouw rt chaiQvS2 MESSAGE* Onxr tBlflphona conversation this aftemoon refers. I vaaldbe -lrery grateful If you coaid arrange issue of a boose draft as follows* • ;) P ayees Richard Ogdan. Juotmti GBP 11,650.00 (Eleven Thousand, Six Hnndred and Fifty Pounds). If this could be left 'with a compliments slip In an envelope addressed to* Six Dacrek BizJdtn, Chairaan, RTZ Corporation Pic. at recaption, collection will be arranged aa soon as I know it is ssa^r. • GSX, Dublin Please debit onx a/c with you* A/C H O w 14143001. Verjw many thanks, hZ & P^- cDNm a«tTiAL rrT ~ w iE ’ •» T ia message transmitted In this Cut b confidential and tar lb« w e Uj* poixou Mined above. U yon haw received this fa* mcssago In error, plow ooltfy u* (mmediaiely »n4 rchJrn Ibe orijlnai xocsase lo w. 'a t Thank you. vipj ’S b ’X O aaaki 'Jr° r Appendix (6) .737} 1 P.O. Box 837, Grand Cayman, Cayman Islands, British West Indies Please reply to: 42 Fitewflfiam Square, Dublin 2. Tel: ff76 5144/676 3065 Fax* 6612035 Telephone: (809) 949-8655 Telex: CP 4305 Facsimile: (809) 949-7946. (809)949-5267 3rd June, 1994 Honan Redmond, Bag.» Corporate Services, Irish Intercontinental Bank Limited, . 91 Merrion Square, DUBLIN 2. ~ —■ ’ Dear Ronan, Could you please arrange to let us have for collection two Sterling cheques as follow: For stg.£2,000.00 payable to TBRRY WELLS ' For stg.£2,042.00 payable to HAMMONDS FURNITURE LIMITED Please debit the cost of both to Hamilton Ross Account No. 0„?/01354/81. Yours 8incerelyf . For HAMILTON ROSS CO. LIMITED * ,\v P Appmdix I 7 I Please reply to: 42 Fitzwilliam Square, Dublin 2. P.O. Box 887. Grand Cayman. Cayman Islands, British West Indies .Telephone:(809)949-8635 Telex CP 4305 Facsimile: (809) 949-7946. (809)949-5267 Tel: 676 5144/676 3065 Fk : 6612035 1 7 th June, 1994. Ms. Daire Nolan-Cas3idy, Corporate Services, Irish intercontinental Bank Limited, 91 Merrion Square, ~ POBLIN 2. • Dear Daire , Could you please arrange to let us have for collection two Sterling cheques as follow: Payable'to BARCLAYCARD for Stg.£1,650.00 Payable to MASTERCARD for Stg.£1,000.00 Please debit the cost of both to Hamilton Rosa Account N O . 02/01354/81. 7 A?wndix . Please reply to: 42 HuwDliam Square, Dublin 2. Tel: 676 5144/676 3C65 Fax 6612035 P.O, Box 887. Grand Cayman, Cayman Islands. British West Indies Telephone: (809) 949-8033 Telex: CP 4303 ' Facsimile (809) 949-7946, (809)949-3267 M l DaireNolaa-Cassidy, Corporate Sendees. Irish Zatercontutentftl Bank Limited. 91 Merricm Square, DUBLIN2. 9th August. 1994. Dear Daire, Could you please arrange to let us have for collection the following Sterling cheques and debit the cost ofallfour to HaxrriftoaRoss Account No.02/01354/81. Payable to: Amount HAKR.ODS Stg.£2,r60.00 TRUMPS . Stg.£3,000.00 CONVERT A ROOM StgJ2.850.00 JOHN LEWIS Stg.£2,069.00 Yours sincerely, For H A ^ tt -t o n /AJW . ftn s s r n h m t t e d prndix i a. Fleacereplyto: P.O. Box 887. Grand Cayman. Cayman Islands. British West Indies 42 FtowifliamSquare, Dublin2. >Telephone: (809) 949-8635 Telex: CP 4305 Facsimile: (809) 949-7946, (809) 949-5267 Tel: 576 5144/576 3063 Pax: 6612035 25th August 1994. Ms. Daire Noian-Cassidy, Corporate Sendees, Irish Intercontinental Bank Limited, 91 Merrion Square, DUBLIN 2. Dear Daire, Could you please arrange to let us have for collection a Sterling Stg.£4,000.00 payable to TERRY WELLS and debit the cost to Hamilton Ross Account No.02/01354/81. Yours sincerely, r > C O ^. 0 fv ..... . For HAMILTON ROSS CO. LIMITED M X t >ly J - ' v MJW ifbos- Hamilton Rosa Co. Limited PleaseReplyto: .tans Own, PO. Box 887. Grand Cayman, Cayman blands. British West Indies'. .Maettvwn Street. Tdeptone (809) 9494655 Told: CP 4305 . Facsimile: (809) 949-7946, (809) 949-3267 12th June, 1995. Ms. DaireNdan-Cuaidy, Tririi 91, Menrion Square, Dublin 2. flm ^ T h n ^>il_ ' ' JDearDaire, Please transfer on 19th June die ran ofStg£13,466J0 to: ■ ' Basque General*du Luxembourg S.A., t Swift Code; BC5LL-LULL for the credit of; < AccountNo. 35-189521-60-1 4D-8060 Please debit our account ao. 02/01354/81 with this amount. Yours sincerely, J Appendix XV (7) Captain RG Bryce 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Captain RG Bryce. a) Letter of 16 December 1975 from John A Furze to GMCT. b) Letter of 22 September 2001 from RG Bryce to the Inspectors. GUINNESS MAHON CAYMAN TRUST LIMITED A Member of tha Guinness Mahon Merchant Banking Group P.O. Box 887 Trim*' cg n m . . Grand Cayman Gw nes*: British West Indies 16th December, 1975 '‘''“Nref r % -ef JAP:nb Captain R. G. Bryce 16 Rue des Didier, 31140 Castel Ginest, Par Aucamville, PRANCE. J*-, rf _ f * Kt v " Dear Capt. Bryce: Thank you very m u c h Indeed for your recent letter ' following which I a m pleased to say w e received the svun o f \ a s $ 1 2 , 0 0 1 . 9 3 from the Chase Manhattan Bank. This amount has been placed on deposit w it h us for a period of six months at 6.875% per annum. I note that from time to time y o u may wish to transfer funds from yo u r account in France to us and I confirm that w e will be pleased to place any additions to the credit of your deposit account. The interest rate applicable to such additions w i l l be the Euro-Doliar interest rate ruling at the time of receipt of the funds in question. ) Finally, m a y I take this opportunity of thanking you for establishing the account wi t h us and should y o u have any further queries or need assistance in financial matters p lease do not hesitate to let me know. W ishing you a very happy Christmas and prosperous 1976. serely, /?j - “St Benedicts”, Thormanby Road, Baily, Dublin 13. . 22 September, 2001. Office o f the Inspectors, 3rd Floor, Trident House, Blackrock, Co. Dublin. 21 S E P jfflfll Your Ref: C/B 15. Dear Inspectors, I am in receipt of your letter dated September 20th, covering the subject of my account with Guinness Mahon Cayman Trust Ltd. The following history o f my places and periods o f employment may be of assistance to you. During June 1974, Aer Lingus (my employer at the time) appointed me to manage an Airbus operation in Bangkok Thailand on behalf o f Airbus Industrie. On completion of the type rating in Toulouse, the Air Siam crews and I ferried the aircraft to Bangkok to commence operations in mid October. I was responsible for the operational aspects of the lease until it was terminated by Airbus in mid October 1975. The aircraft was returned to Toulouse and I remained with Airbus for a further two and a half years. My family and I returned to Ireland in mid April 1977. During our absence from Ireland our house was rented by two parties, Mr J.P. Debeir between Jan & Dec 1976 and Mr. J.B. Thompson Feb 1976 to Feb 1977. Following my departure from Bangkok, Mr. J. Guinness a sailing friend and then Chairman o f Guinness Mahon offered to set up an account in the Cayman Trust on my behalf in order that I could leave my savings offshore until my return to Ireland. My family and I re-established domicile in Ireland in mid April 1977. The monies in my Guinness Mahon Cayman account would have been repatriated during the tax year following my return as best I can remember. It was my understanding that this was correct in terms of the tax regulations in force at this time. As it is some 24 years since I returned to Ireland my memory is not a clear as one would wish. Also any records which pertain to the foregoing have regrettably been discarded some years ago. I have recorded the foregoing as truthfully as possible considering the time scale concerned. In closing I wish to offer all assistance possible so that this affair can be concluded as expeditiously as possible. Please note that 1 will be on vacation from to-day until October 6th. Yours Faithfully, .... Capt. R.G. Bryce. Appendix XV (8) Mr John Byrne 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John Byrne. a) Transcript of evidence of Mr John Byrne of 24 January 2001. b) Statement of Mr John Byne furnished by letter of 4 December 2000. c) Charts prepared by Mr Byrne re Irish Companies structure & the UK companies. d) Letter of 30 April 1982, Guinness and Mahon to the Secretary, Carlisle Trust Ltd. e) Internal Guinness and Mahon memo of 21 January 1982 to Mr D Robson. f) Internal Guinness and Mahon memo of 20 April 1982 from JD Traynor re Carlisle Trust. g) Statement of account of 31 May 1990 re a/c no. 80019005. h) Principal Ledger of Ansbacher Cayman Ltd Call deposit account in Guinness and Mahon, account Ref No. 13154602 of 1 January 1987. i) Letter of 23 April 1990 from JD Traynor to Guinness and Mahon. j) Statements from 30 April 1990 to 31 October 1992 re a/c no. 80019005. k) Statement of Account No. 80019005 of 30 September 1994. 1) Internal IIB memo of 27 March 1992 re Tepbrook Properties Ltd. m) IIB loan agreement of 18 April 1994. n) Letter of 25 April 1994 from IIB to Mrs Ciara Byrne, Ballymadun Stud. o) Letter of Lien of 20 April 1994. p) Letter of guarantee of 20 April 1994 - Hamilton Ross to IIB. q) Letter of guarantee of 6 June 1975 from John Byrne & Ciara Byrne to Guinness and Mahon. r) Letter of guarantee of 12 October 1989 from Endcamp Ltd to Guinness and Mahon. s) Letter of 19 November 2001 from Gore & Grimes, Solicitors to the Inspectors. t) Letter of 26 February 2001 from Gore & Grimes to the Solicitor to the Inspectors. . . UNDER OATH ON WEDNESDAY, 24TH JANUARY 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: HIS HONOUR JUDGE O'LEARY M R . ROWAN FCA Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. JOHN BYRNE Represented by: MR. B. SHIPSEY SC Instructed by: MR. ANTHONY GORE GRIMES GORE & GRIMES CAVENDISH HOUSE SMITHFIELD DUBLIN 7 WITNESS EXAMINATION MR. J. BYRNE JUDGE O'LEARY PAGE 6 - 77 M R . ROWAN 78 - 81 JUDGE O'LEARY 82 - 84 1 THE EXAMINATION COMMENCED, AS FOLLOWS, ON WEDNESDAY, 2 24TH JANUARY 2 001: 3 4 5 JUDGE O'LEARY: 6 Could I first of all say that this is an interview. 7 It is not a hearing. 8 an interview. It is not a Court. It is just 9 10 I note, Mr. Byrne, and I am delighted to see, 11 that you have your legal advisors with you. 12 is entitled to consult with his legal advisors at 13 any time. 14 in the middle of a question, that you would like 15 to consult with your legal advisors all you have 16 to do to me is say, "I would like to consult with 17 my legal advisors," and we will leave the room 18 and allow you have that time for consultation. He If you feel at any time, whether it is 19 20 If on the other hand your legal advisors feel that 21 they should consult with you they can similarly say, 22 "Would you mind giving us a few minutes," and we 23 will give you a few minutes. 24 MR. BYRNE: Thank you, Judge. 25 JUDGE O'LEARY: There is no difficulty 26 with regard to that. 27 MR. BYRNE: Thank you. 28 JUDGE O'LEARY: I want to make this as 29 1 possibly can. 2 3 JUDGE O'LEARY: All right? 4 MR. BYRNE: All right. 5 JUDGE O'LEARY: The really only formal 6 part of it is the taking 7 of the oath, if you like, because that gives it a 8 stamp of approval. 9 our solicitor to administer the oath. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 I will ask you now -- I will ask 1 MR. JOHN BYRNE, HAVING BEEN SWORN, WAS EXAMINED BY 2 HIS HONOUR JUDGE O'LEARY AS FOLLOWS: 3 4 5 1 Q. JUDGE O'LEARY: Mr. Byrne, if you feel 6 tired at any time or 7 anything like that all you have to do is say you 8 want time out. 9 in that regard? 10 A. 11 2 Q. There is no difficulty with that Thank you. In any event at around 11 o'clock we will take a 12 break. 13 We hope to deal with the matter in a civilised 14 fashion. 15 that we are not investigating John Byrne. 16 is not the purpose of our investigation. 17 investigating a company. There will be tea or coffee there for you. First of all I should explain to you That We are 18 19 Unfortunately a lot of people had tangential 20 arrangements with the company we are investigating 21 and those people are, if you like, included in our 22 net but they are not the focus of our investigation. 23 So, we are -- there is absolutely no agenda. 24 as we are concerned we are investigating 25 the company. As far 26 27 Unfortunately we have to ask you questions because 28 you did a lot of business with the company and you 29 are one of the principal customers of the company 1 but if you think of it in that way for the moment 2 I think that is nearly the best way of looking at 3 it. 4 5 We are certainly passing no criticism of you today. 6 If at any time in the future we want to pass a 7 criticism of you we will give you an opportunity, 8 through yourself or through your lawyers, to come 9 in before us and make whatever representations, 10 cross-examine any people, or produce evidence, of 11 your own as would be appropriate? 12 A. 13 3 Q. Thank you, Judge. So, all those things will be there. Could I first 14 of all say that your statement to us was extremely 15 helpful and we appreciate that gratefully. 16 made our job a lot easier. 17 stuff that deals with you, Mr. Byrne. 18 is not relevant to our enquiry at all. 19 it is of peripheral interest and even if it is of 20 interest to us there is so much repetition there? 21 A. 22 4 Q. 23 It has We have volumes of Most of it Most of Yes. That if you see the situation that obtained in one case it obtained in the other? 24 A. 25 5 Q. 26 A. 27 6 Q. Yes. Mr. Byrne, did you approve the statement yourself? I did, yes. Yes. In other words can I take it that now on 28 oath you are confirming the matters contained in 29 the statement, Exhibit 1? 1 2 7 Q. All right. Fair enough. So, that saves a lot 3 of time because as I say it is a very helpful 4 statement, Exhibit 1. 5 again the focus here is the company and there will 6 be a few questions about yourself later but by and 7 large the focus is the company. 8 back to when you first started doing business with 9 the company which is under investigation, which Could I bring you back -­ Could I bring you 10 was ultimately Ansbacher or Guinness Mahon Cayman 11 Trust or Mr. Des Traynor? 12 you started doing business with them, do you 13 remember, Mr. Byrne? 14 A. 15 8 Q. 16 A. 17 9 Q. 18 When was the first time Well, it would have to be some time in the 1970's. Yes. The Trusts were established in 1971? They were, yes. It was obvious that you were doing business with them at that stage? 19 A. 20 10 Q. 21 A. 22 11 Q. 23 I was, yes. From that stage on? I was, yes. Would you have done business with them before that do you think? 24 A. 25 12 Q. 26 A. 27 13 Q. 28 A. 29 14 Q. I don't think so. You think they were the first introduction? I think that was when...(INTERJECTION). The relationship started? The relationship started you might say. Yes, I understand. We can take it that that 1 2 3 15 Q. 4 A. 5 16 Q. 6 A. 7 17 Q. 8 A. 9 18 Q. 10 A. 11 19 Q. 12 A. 13 20 Q. 14 15 All right? I don't think...(INTERJECTION). And...(INTERJECTION)? I don't think we go back before that. Yes. I am not interested in it any way? Yes, yes. To be honest with you I have no interest whatsoever? Yes. It is only to put the thing in its proper context? Yes, yes. Did you know Mr. Traynor before this or was it through this that you got to know him? A. No, I knew Mr. Traynor for quite some time before 16 that. 17 was around 1960 -- I know he was -- the first 18 time I really met him at close quarters was the 19 first time he came down to do an audit in the 20 Brandon Hotel in Tralee. 21 21 Q. 22 A. 23 He -- the first time I met Mr. Traynor I see? With Jack Stakelum and I was extremely impressed with him. 24 22 Q. 25 A. Yes? Because he -- they came down to do the audit some 26 time in the afternoon and they worked all night. 27 I said I would see them in the morning and they 28 were gone. 29 worked all night and they were gone back to Dublin. They finished the whole lot. They 1 23 Q. 2 A. 3 24 Q. 4 A. 5 25 Q. 6 A. 7 26 Q. 8 A. 9 I see? So, I said, "God, these are some characters". Yes? And after that I became very friendly with him. Yes? And he was my financial advisor. I know, yes? And he was -- strictly speaking anything I did I consulted with him. 10 27 Q. 11 A. 12 28 Q. 13 You consulted with him, I understand? Because I ...(INTERJECTION). He must have been a remarkable man because there was a lot of people depended on him? 14 A. 15 29 Q. 16 A. It was extraordinary, Judge. Yes? Because, you know, you would be surprised -- I 17 mean there are times, you know, when you read the 18 paper and it describes what they say and you would 19 love to say something but, you know, you can't. 20 30 Q. 21 He must have been a remarkable man. I mean that is a fair comment? 22 A. 23 31 Q. 24 A. 25 32 Q. 26 A. 27 He was a remarkable fellow. Yes. That is fair? And I am not an accountant. Yes? And being -- and not being an accountant then of course you left everything to him. 28 33 Q. 29 A. Yes? As far as financial matters were concerned. 1 I appreciate that. 2 of the problems that we have come across and 3 Mr. Traynor will be the focus of some of our 4 enquiries because he held a position in the 5 company; you understand? 6 A 7 35 Q I appreciate that. One I do, yes. One of the difficulties which we are coming 8 across is, and I think it is encapsulated more 9 in your case than any other case, that really 10 Mr. Traynor was wearing a lot of hats when he 11 was dealing with you? 12 A Well, he was I suppose in one way because he was...(INTERJECTION). 13 14 36 Q 15 A He was a Director of one of your companies? He was a Director of the company and he was -­ 16 anything that -- if there was any problem or any, 17 we will say, shortage of funds for the various 18 proj ects. 19 37 Q 20 A 21 38 Q 22 A 23 Yes? He was the first to be brought in the firing line. Yes? In other words, "Look, we have this problem. You...(INTERJECTION)". 24 39 Q 25 A 26 40 Q 27 A You solve it? Solve it. Yes, I understand? And invariably he did and he was the sort of man, 28 Judge, that it doesn't matter what sort of a 29 problem you had or a worry you had. He had the 1 capacity of saying, 2 about, you know? 3 41 Q. 4 A. 5 42 Q. 6 A. 7 43 Q. "Well, what are you worrying Its nothing". Yes? "I can solve that." Yes? He was like that. The problem though from our prospective is he 8 has done a lot of things, I am sure all very good 9 things, and when we are assessing those things, and 10 particularly with what I have to talk to you later 11 about, it is very hard for us to know whether at a 12 particular time he was acting as your Director; as 13 your banker; or as some kind of liaison with the 14 Cayman Islands situation; or all three at any 15 particular time. 16 A. 17 Well, I don't think he ever had anything to do with the direction of the companies as such. 18 44 Q. 19 A. 20 45 Q. 21 22 Yes. That is the problem? Yes? Or anything that was going on. I know. H e ...(INTERJECTION). He was not the man who decided what you were going to build or let or anything? A. Or do and never discussed anything. In other words 23 you might say that he never came into the picture 24 unless there was some hiccup or...(INTERJECTION). 25 46 Q. then and a banker? 26 27 A. 28 47 Q. 29 However, the problem is that he was both a Director He was. He was a banker all right. And when we come to the question of the back to back loans he was probably doing something else as well. 1 So, I mean he was doing three things, if you like, 2 all at the one time; is that not it? 3 that as a problem at the time? 4 A. 5 48 Q. 6 A. No, Judge, I didn't. 7 49 Q. That is fair enough. 8 Did you see I didn't, no. All right. You did not see that? That is fair enough. However, he was also your advisor? 9 A. 10 50 Q. 11 A. 12 51 Q. He was, yes. However, primarily on financial matters? Strictly financial. Yes, I understand that. You set up two structures in 1971 in the Cayman Islands? 13 14 A. 15 52 Q. Yes. Forget for the moment who owns them. We will 16 come back to that argument later and I am sure 17 Mr. Shipsey and myself will have great discussions 18 about that in due course. 19 to do at the moment is to understand it. 20 all I am trying to do? 21 A. 22 53 Q. 23 A. 24 54 Q. However, all I am trying That is Yes, yes. Is to understand it? Yes. I want to make it clear that we are not in the 25 slightest way concerned with whether what you did 26 in 1971 was legal or illegal. 27 about that. 28 that problem out yourself. 29 We have no concern It is not our problem. You can sort Do you understand? 1 However, factually speaking two structures were 2 set up in which you had a part. 3 any more than that. 4 I will not say anything at the moment other than 5 you had a part. 6 quantity of paper that I have to understand it 7 and I am going to see, to ask you, do I understand 8 it? 9 only a chart of the various companies I will not put it I will not say you owned them. I have struggled from the vast Am I first of all saying that -- this is (indicating). 10 MR. GORE GRIMES: Yes . 11 MR. SHIPSEY: Yes . 12 JUDGE O'LEARY: That is all it is. 13 MR. GORE GRIMES: However, we have a chart 14 here (indicating). 15 JUDGE O'LEARY: You have a chart as well? 16 MR. SHIPSEY: Yes . 17 MR. GORE GRIMES: Just if it is helpful 18 19 to you. MR. SHIPSEY: 20 We just thought...(INTERJECTION). 21 MR. GORE GRIMES: Yes . 22 MR. SHIPSEY: I am sorry, 23 Judge...(INTERJECTION). 24 JUDGE O'LEARY: Yes . 25 MR. SHIPSEY: We should may be have done it earlier. 26 27 JUDGE O'LEARY: 28 29 I have no difficulty at all. MR. SHIPSEY: We have an Irish companies 1 2 structure, Exhibit 2. 3 JUDGE O'LEARY: That is very helpful. 4 MR. GORE GRIMES: Yes . 5 MR. SHIPSEY: So...(INTERJECTION). 6 JUDGE O'LEARY: Extremely helpful. 7 It is an awful pity we did not 8 have it before. 9 MR. SHIPSEY: I am sorry. 10 JUDGE O'LEARY: Yes, that is grand. 11 MR. SHIPSEY: We should have just 12 considered this earlier 13 as an aid memoire 14 JUDGE O'LEARY: (Same Handed), Exhibit 2. It is extremely helpful. No, if you look at -- I 15 16 had Dublin City Estates 17 I did not bother about 18 about and Goreville, ye 19 MR. SHIPSEY: Smithfield was Endcamp. 20 JUDGE O'LEARY: Endcamp? 21 MR. SHIPSEY: It is a new name for 22 I had Alstead. Smithfield ecause I was not concerned Endcamp. 23 JUDGE O'LEARY: Was it formally Endcamp? 24 MR. SHIPSEY: Yes . 25 JUDGE O'LEARY: And then you went up to Carlisle Trust. 26 27 MR. SHIPSEY: Yes . 28 JUDGE O'LEARY: That is the way I had it, 29 yes . 1 2 JUDGE O'LEARY: 3 Except funnily enough I had Dublin City Estates as 4 having a direct relationship with Ansbacher Cayman. 5 MR. GORE GRIMES: It did originally. 6 JUDGE O'LEARY: Rather than through 7 Carlisle. 8 MR. GORE GRIMES: It did originally. 9 JUDGE O'LEARY: It did originally but it 10 changed; did it? 11 MR. GORE GRIMES: It changed. 12 JUDGE O'LEARY: I see. 13 MR. GORE GRIMES: Then it went under 14 15 Carlisle. JUDGE O'LEARY: 16 So, I am right but I am wrong; is the position. 17 MR. GORE GRIMES: Well, you are right. 18 JUDGE O'LEARY: Yes . 19 MR. GORE GRIMES: And then later it changed. 20 JUDGE O'LEARY: Yes, I understand. 21 MR. GORE GRIMES: Yes . 22 JUDGE O'LEARY: So, that was the way it 23 was structured; all right? 24 MR. GORE GRIMES: Yes . 25 JUDGE O'LEARY: We went up to Ansbacher Cayman and then we went 26 27 up to Prospect Holdings and then we had Prospect 28 Settlement. 29 MR. GORE GRIMES: Correct. 1 2 right. 3 MR. GORE GRIMES: Good. 4 JUDGE O'LEARY: Could I say to you that 5 Dublin City Estates, for 6 example -- no, let us take Carlisle Trust as, if you 7 like, the primary operating company? 8 1,000 shares in that company and 990 of them are, at 9 the time I was talking about them, they may have There are 10 changed since, what are called B shares and 10 are A 11 shares ? 12 A 13 57 Q Yes . And you can take it, Mr. Byrne, I am familiar with 14 the purpose of that and I have no comment to pass 15 one way or the other about it. 16 are held, or were held, at a time when I had the 17 record: Four by you; four by Mrs. Byrne; one by 18 Mr. Gore Grimes and one by Mr. Traynor. 19 MR. GORE GRIMES: 20 The 10 A shares One by Mr. Christopher Gore Grimes. 21 JUDGE O'LEARY: Christopher Gore Grimes. 22 MR. GORE GRIMES: Yes. JUDGE O'LEARY: Were they -- was 23 58 Q 24 Mr. Christopher Gore 25 Grimes's share an actual share or was he 26 only holding it for somebody else or do you know? 27 A 28 59 Q 29 A I am not -- I think it was a nominee? A kind of a nominee? 1 60 Q 2 A 3 61 Q 4 A 5 62 Q 6 A 7 63 Q 8 A 9 64 Q 10 Fair enough. On behalf of either you or your wife? Yes, yes. And Mr. Traynor would be in the same category? That is it exactly. They were Directors of the company? Yes, yes. And they wanted -- they obviously had that? Yes . All right. I understand that. MR. GORE GRIMES: 11 And they have since -­ this is just to clear 12 up: 13 & Mrs. Byrne's; all the main shares have. 14 JUDGE O'LEARY: Have they? 15 MR. GORE GRIMES: Yes . 16 JUDGE O'LEARY: All right. They have since been transferred to Mr. Byrne 17 18 it? MR. SHIPSEY: MR. GORE GRIMES: 21 22 And that is shown...(INTERJECTION). 19 20 Five each is I think there is five each, yes. MR. SHIPSEY: 23 That is shown on the chart as well. The voting A 24 preference. 25 JUDGE O'LEARY: Yes. 26 MR. SHIPSEY: Yes . 27 JUDGE O'LEARY: I just want to get it 28 29 It is, yes. clear in my own mind. 1 2 Prospect Holdings. 3 Prospect Holdings is an unlimited company in the 4 Cayman Islands. 5 MR. GORE GRIMES: Yes. 6 JUDGE O'LEARY: It has share capital I 7 think of £21,000. It 8 was divided into: 9 D shares, which were convertible shares; ordinary A shares; B shares; C shares; 10 shares and redeemable preference shares and they 11 were as follows: 12 and Articles of Association those A shares are 13 linked with your name. 14 duties and...(INTERJECTION)? 15 A 16 66 Q 17 A 18 67 Q A shares -- now, in the Memorandum There are certain powers and Yes, yes, yes. Granted to the A shares? Yes, yes. And they have certain powers during your life time. 19 Can I take it that you owned those A shares; the A 20 shares ? 21 A Yes. Well, Judge, I am not an accountant 22 but certainly I always understood that I would 23 in circumstances, certain 24 circumstances...(INTERJECTION). 25 68 Q 26 A 27 69 Q Mr. Byrne? Yes . I do not want an explanation from you. 28 not interested in traps. 29 in traps at all? I am I have no interest 1 2 70 Q. 3 A. 4 71 Q. 5 A. 6 72 Q. 7 A. 8 73 Q. 9 A. 10 11 74 Q . A. I want to know just the facts of the situation? Yes. And if you would prefer me to ask your solicitor? Yes. I will swear him in and ask him. Yes, yes. I have no difficulty in that regard? Yes, but I do know, Judge. Yes? That in as far as Prospect: The only involvement 12 I would have in Prospect and this is -- I am not 13 an accountant. 14 75 Q. 15 A. 16 Yes? This is that in case the whole family -- the family were the beneficiaries. 17 76 Q. 18 A. 19 77 Q. 20 Yes, I understand that? But in case...(INTERJECTION). I understand. I understand what the structure is and I understand all that? 21 A. 22 78 Q. 23 A. 24 79 Q. In case the whole family were wiped out. Yes, I understand that? It would come back to me. However, I just want to find out who owns the A; 25 B; C; D shares; ordinary shares; and redeemable 26 preference shares? 27 A. 28 80 Q. 29 Yes. Could you (to solicitor)? MR. GORE GRIMES: I can't even give you that 1 2 JUDGE O'LEARY: Well, will you? 3 MR. GORE GRIMES: Because I don't have it 4 available to me here. 5 JUDGE O'LEARY: Will you post it on? 6 MR. GORE GRIMES: I can certainly find it 7 8 out for you; no problem. il Q. JUDGE O'LEARY: 9 Are you happy for him to do that, Mr Byrne? 10 A. 11 i2 Q. I am very much; very happy. All right. 12 MR. GORE GRIMES: Yes . 13 JUDGE O'LEARY: So, we will just leave it. 14 MR. GORE GRIMES: Yes . 15 JUDGE O'LEARY: I think the A shares are 16 Mr. Byrne's. 17 B shares are Mrs. Byrne's. 18 shares belong to people. 19 belong to. 20 MR. GORE GRIMES: 21 I think the I think the C and D I do not know who they They were -- yes, there were shares issued to 22 the public. 23 JUDGE O'LEARY: Yes . 24 MR. GORE GRIMES: In the Caymans. 25 JUDGE O'LEARY: Yes . 26 MR. GORE GRIMES: And the reason for that 27 28 29 was to create a public company. 1 To make the thing a public 2 company. 3 JUDGE O'LEARY: Yes, a public company. 4 MR. GORE GRIMES: In order 5 6 to be known. JUDGE O'LEARY: 7 8 A public unlimited company? MR. GORE GRIMES: 9 A public unlimited company. 10 JUDGE O'LEARY: Yes . 11 MR. GORE GRIMES: In order to avail of 12 certain artificial 13 valuation rules. 14 JUDGE O'LEARY: All right. 15 MR. GORE GRIMES: In relation to a Estate 16 17 duty. JUDGE O'LEARY: 18 All right. I am not really concerned. 19 I just...(INTERJECTION). 20 MR. GORE GRIMES: No. 21 JUDGE O'LEARY: Yes . 22 MR. GORE GRIMES: Just so you understand 23 why it was done. 24 JUDGE O'LEARY: Yes, I understand. 25 MR. GORE GRIMES: That is the whole reason. 26 JUDGE O'LEARY: Yes. 27 28 29 Above the Prospect Holdings there is Prospect Settlement. 1 2 Settlor there. 3 MR. GORE GRIMES: Yes. 4 JUDGE O'LEARY: And you did say in your 5 statement, Exhibit 1, 6 Mr. Byrne, that there were a number of documents 7 which you have given us for Tristan that you would 8 make available to us for Prospect but I think one of 9 those documents may not exist at all. There is a 10 Letter of Wishes in the Tristan case from Mr. Furze. 11 MR. GORE GRIMES: Yes. 12 JUDGE O'LEARY: However, there was no need for a Letter of Wishes in 13 14 this case. 15 MR. GORE GRIMES: There may not be. 16 17 That is possible. 83 Q JUDGE O'LEARY: Because not only are you 18 the Settlor but you retain 19 the right to appoint new Trustees? 20 A 21 84 Q Yes . So, you are both the Settlor and you retain the 22 right. 23 Settlor? 24 A 25 85 Q In the case of Tristan Mr. Furze was the That's right. And in order to get over that situation he then 26 gave to you the power to appoint the new Trustees; 27 is that accurate? 28 A 29 86 Q That would be accurate. Yes, Okay. So, I am fairly clear on that and that 23 1 structure and subject to the other information which 2 Mr. -- 3 too fast. 4 try to slow down, Mr. Byrne? 5 6 )1 yes. I am sorry. Apparently I am speaking Everybody complains about that. A. No, that is fine, Judge. Q. All right, Okay. I will I understand that side of the 7 equation. 8 about which I really have not as much information 9 at all. There is another side of the equation I am going to start from the top there 10 (indicating). 11 John Furze. 12 new Trustees to you John Byrne, the Appointee, and 13 there was a Letter of Wishes and we have all those. 14 MR. GORE GRIMES: Yes. 15 JUDGE O'LEARY: There is no difficulty The Tristan Trust: The Settlor was He transferred the power to appoint about that. 16 Underneath 17 that was Tristan Securities. 18 MR. GORE GRIMES: Limited. 19 JUDGE O'LEARY: Sorry? 20 MR. GORE GRIMES: Limited. 21 JUDGE O'LEARY: Limited. 22 MR. GORE GRIMES: A limited company. 23 JUDGE O'LEARY: A limited company, yes. 24 MR. GORE GRIMES: Yes. 25 JUDGE O'LEARY: Limited, yes. 26 MR. GORE GRIMES: Yes. 27 JUDGE O'LEARY: And you would say they are nominee Directors; is it? 28 29 MR. GORE GRIMES: The Directors originally 1 were John Furze and 2 John Collins. 3 JUDGE O'LEARY: Yes . 4 MR. GORE GRIMES: But they are now -- I mean I am not sure who they 5 6 are now. 7 JUDGE O'LEARY: All right. 8 MR. GORE GRIMES: They are just nominees. 9 JUDGE O'LEARY: They are just nominees. 10 MR. SHIPSEY: Nominees. 11 MR. GORE GRIMES: They are just officials of 12 13 Ansbacher. JUDGE O'LEARY: Yes. Could I by the way ask you in respect of 14 15 Prospect: Who are the 16 Directors there now as ' ell? 17 MR. GORE GRIMES: Exactly the same, yes. 18 JUDGE O'LEARY: And is Mr. Byrne a irectors? Is it nominee Director of either of 19 20 those companies? 21 MR. GORE GRIMES: No, no, he is not. 22 JUDGE O'LEARY: All right. Securities: 23 So, Tristan When we come 24 down from Tristan Secur Lties I had a query to ask 25 you about Danstar but I mean you have it down 26 there: "Danstar". 27 MR. GORE GRIMES: Yes . 28 JUDGE O'LEARY: And I have seen all that. 29 MR. GORE GRIMES: Yes . 1 JUDGE O'LEARY: 2 And Intramar Securities; is it? 3 MR. GORE GRIMES: Yes . 4 JUDGE O'LEARY: Intramar Securities. 5 MR. GORE GRIMES: And I am -- we are not 6 sure if that is limited or 7 unlimited. 8 JUDGE O'LEARY: All right, yes. Then there is Tepbrook 9 10 Properties, about which I was familiar. 11 MR. GORE GRIMES: Yes. 12 JUDGE O'LEARY: The shareholding of the Tristan side: 13 The 14 Tepbrook Properties shareholders are Danstar; I 15 understand that. 16 MR. GORE GRIMES: Yes. 17 JUDGE O'LEARY: And the Directors are Ronald Woss and 18 19 Pat McCann. Are they just nominees Directors or 20 are they working for the company? 21 MR. GORE GRIMES: Ronald Woss is Australian and Pat McCann is here in 22 23 Dublin. 24 JUDGE O'LEARY: Is here in Dublin? 25 MR. GORE GRIMES: Yes . JUDGE O'LEARY: Mr. Byrne, are you a 26 Q. Director of Tepbrook? 27 28 A. No. 29 Q. No. All right. I am sorry for being so 1 Yes . 2 3 90 Q However, if I do not understand it, you know...(INTERJECTION)? 4 5 A 6 91 Q No, Judge. If I do not understand it -- then you go to Danstar Holdings, which is an Australian company? 7 8 A 9 92 Q Yes . And the Directors of that are Ronald Woss and who 10 else? 11 MR. GORE GRIMES: The Directors, sorry, of Danstar? 12 13 JUDGE O'LEARY: Yes . 14 MR. GORE GRIMES: A W. Trainor. 15 JUDGE O'LEARY: Yes . 16 MR. GORE GRIMES: No relation of the late Des Traynor. 17 18 JUDGE O'LEARY: No relation at all. 19 MR. GORE GRIMES: But...(INTERJECTION) 20 JUDGE O'LEARY: All right. 21 MR. GORE GRIMES: It is T-r-a-i-n-o-r. 22 JUDGE O'LEARY: Yes, all right. 23 MR. GORE GRIMES: But another Australian. Two Australian people. 24 25 JUDGE O'LEARY: All right. 26 MR. GORE GRIMES: Who are pure nominees. 27 JUDGE O'LEARY: Yes, and that is 100% 28 29 owned by Tristan 1 the shares were held by 2 3 the late John Furze and by John Collins as Trustees 4 for TSL, yes. 5 JUDGE O'LEARY: 6 All right. That is excellent. Mr. Byrne, 7 do you have any of the A and B type shareholdings 8 in the UK company structure? 9 A 10 94 Q 11 You mean? Either preference shares that you have in the Irish companies? 12 A 13 95 Q 14 A 15 96 Q No, no. You do not have that? No. Thank you. Am I right in saying -- that is very 16 helpful. 17 saying that these entities within the Cayman are 18 two separate entities? 19 down between them. 20 MR. GORE GRIMES: Yes. 21 JUDGE O'LEARY: They are two separate Thank you very much. Am I right in I mean there is a line entities ? 22 23 MR. GORE GRIMES: They are. 24 JUDGE O'LEARY: They are two separate 25 entities. Obviously 26 they have to be. 27 MR. GORE GRIMES: Yes . 28 JUDGE O'LEARY: That is the way the system 29 operates. I understand 1 that. 2 now if you do not mind for the moment and I can 3 work from your excellent document; okay, Exhibit 3? 4 We are not the slightest bit interested, Mr. Byrne, 5 in 1972 or 1971 or indeed today how much money is 6 in the Caymans. 7 that. 8 not insisting you answer this question, it is a 9 matter entirely for yourself, if you could tell me That is helpful now. I will put that down We have no interest whatsoever in It might however be helpful to us, and I am 10 which of the two Trusts were bigger in terms of 11 their cash availability; that is all? 12 want to know what it is. 13 the Prospect Trust? 14 A 15 98 Q I do not Was it the Tristan or Tristan. Tristan, yes. I got that impression but obviously 16 I could not guess it. 17 Now...(INTERJECTION). 18 MR. GORE GRIMES: 19 All right. Judge, it may be helpful to you just to say that 20 Prospect effectively has no cash. 21 JUDGE O'LEARY: Yes, I understand. 22 MR. GORE GRIMES: Prospect is simply shares. 23 JUDGE O'LEARY: I worked that out myself. 24 MR. GORE GRIMES: Yes, yes. 25 JUDGE O'LEARY: However, I just wanted to confirm that. 26 27 MR. GORE GRIMES: Yes. 28 29 difficult when you are 1 dealing with such a vast volume of paper, Mr. Byrne. 2 MR. GORE GRIMES: 3 A. 4 99 Q. Of course. Absolutely. JUDGE O'LEARY: To actually come to these 5 conclusions ? 6 A. 7 100 Q. Sure. You have said in your statement, Exhibit 1, 8 Mr. Byrne, that from time to time, in respect 9 of various ventures, borrowings were made from 10 Guinness & Mahon; IIB; and may be from other 11 Institutions; may be from Kredietbank, which were 12 backed by funds from what I would call loosely "the 13 Cayman set up". I am not calling it that in a 14 pejorative way. I am saying "the Cayman set up". 15 Those were the facts. 16 disputing those? 17 A. 18 101 Q. 19 A. 20 102 Q. There is no point in Correct. You accept that? I do, yes. Yes. We have, Mr. Byrne, and normally we do 21 not tell people what we have but we are telling 22 you this, from the Hamilton Ross structures the 23 J accounts. 24 one pooled account and they were J. 25 various code names? 26 A. 27 103 Q. 28 A. 29 104 Q. The way they operated was: There was There was Yes. One of the code names was J? Yes. It is quite obvious from looking at all the 1 J accounts that they referred to the same 2 operation because they were transferring -- J1 3 was transferring into J2 and J2 was transferring 4 into J6. 5 J accounts were connected with the Cayman 6 operation; is that true? 7 A 8 105 Q 9 That could be, Judge. A 11 106 Q 12 A 13 107 Q 14 A 15 108 Q I can give you a look at the J accounts if you Yes, yes. And you can assess it yourself? Well...(INTERJECTION). I have no difficulty in that regard? Yes, but...(INTERJECTION). I am not trying to fool anybody. MR. GORE GRIMES: 17 I think it might be better, Judge, just 18 to look at them. 19 JUDGE O'LEARY: Yes. What I am going to do is...(INTERJECTION). 20 21 It could be true. want to? 10 16 We have received evidence that the MR. GORE GRIMES: Sorry -- I mean the reason I say that is because I 22 23 don't know whether you are suggesting, Judge, that 24 Hamilton Ross are owned by Ansbacher. 25 JUDGE O'LEARY: No, no. 26 MR. GORE GRIMES: You are not. 27 JUDGE O'LEARY: Nothing at all to do with 28 29 that. 1 not think that is right. 2 JUDGE O'LEARY: Nothing to do with that. 3 MR. GORE GRIMES: I think they are separate. 4 Just as you mentioned 5 it...(INTERJECTION) 6 JUDGE O'LEARY: 7 8 Mr. Byrne. A. 9 10 Yes, yes. MR. GORE GRIMES: Yes . JUDGE O'LEARY: I mean I do not 11 want...(INTERJECTION). MR. GORE GRIMES: 12 That is why...(INTERJECTION). 13 14 JUDGE O'LEARY: 15 I do not want it to be dialogue between myself 16 17 No, no, and I will talk to and the...(INTERJECTION A. Yes. 18 MR. GORE GRIMES: No . 19 JUDGE O'LEARY: And...(INTERJECTION). 20 A. Yes. 21 MR. GORE GRIMES: Yes. 22 JUDGE O'LEARY: All I am interested to 23 know is: Whether the 24 J accounts which we have, irrespective for the 25 moment of where they were, are accounts in respect 26 of money which had its origin in the Cayman set up, 27 the Cayman organisation, set up by Mr. Byrne in 28 1971. 29 That is all I am interested in. 1 2 to do is I am going to 3 4 rise for a few minutes 5 MR. GORE GRIMES: Yes. 6 JUDGE O'LEARY: And give you an opportunity to see them. 7 8 MR. GORE GRIMES: Yes. 9 MR. SHIPSEY: Thank you. JUDGE O'LEARY: They might not be all 10 11 there but there is 12 enough there to make up your mind I guarantee you. 13 A 14 109 Q All right. Thanks. I will hand you over a file, for the purpose of the 15 note, which contains the J accounts. 16 MR. SHIPSEY: 17 18 Would you like us to go to another room? JUDGE O'LEARY: No, no, not at all. Mr. Shipsey, would you 19 20 just give it back to me one second please? 21 MR. SHIPSEY: Yes, sure. 22 JUDGE O'LEARY: I just want to make sure: (1) that it is what I say 23 24 it is. 25 you other information and that I had not anything 26 written on it (Same Handed). 27 MR. SHIPSEY: 28 29 Yes, that is because I do not want to give Sure, okay. Thank you. 1 2 MR. GORE GRIMES: Yes. 3 MR. SHIPSEY: Very good. 4 JUDGE O'LEARY: All right? 5 A. Thank you very much. 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 SHORT ADJOURNMENT 1 2 AS FOLLOWS: 3 4 5 MR. SHIPSEY: 6 Judge, I will give you back the folder (Same 7 Handed). 8 JUDGE O'LEARY: Thank you. 9 MR. SHIPSEY: Mr. Byrne has looked at -­ 10 there are -- I do not want 11 to be giving evidence but there are other accounts. 12 We just looked at the Hamilton Ross ones in that. 13 JUDGE O'LEARY: Yes . 14 MR. SHIPSEY: So, that is what Mr. Byrne 15 has addressed his mind to 16 17 in relation to the Hamilton Ross accounts. 110 Q JUDGE O'LEARY: 18 Yes. The J accounts and Hamilton Ross: 19 -- have they their origin in your — 20 not say it is your structure. 21 the Caymans? 22 A 23 111 Q 24 A 25 112 Q 26 A 27 113 Q 28 29 Are they well, I will In the structure in Well, I would say they were ours. All right? Pertaining to me. Okay, that is fair enough? In one way or another, yes. That is fair enough. MR. SHIPSEY: I ...(INTERJECTION). 1 2 I know, yes. 3 JUDGE O'LEARY: Really...(INTERJECTION). 4 MR. SHIPSEY: Yes, yes. 5 A. 6 114 Q. Yes, yes. JUDGE O'LEARY: I hope I am being as 7 fair to Mr. Byrne as I 8 can. 9 have a little bit of a disagreement, Mr. Byrne? 10 A. Okay. 11 115 Q. Okay? 12 A. Fine. 13 116 Q. 14 A. 15 117 Q. I think this is the first time we are going to I should flag this to you? Yes. The reason that I cannot put earlier accounts 16 to you is because we do not have the information 17 from Ansbacher in Cayman but of course you could 18 make that information available to us if you 19 wanted to and you have chosen not to do so? 20 A. Well, I don't think that is right. 21 MR. GORE GRIMES: I ...(INTERJECTION). 22 JUDGE O'LEARY: I am not interested in -­ 23 I am talking to Mr. Byrne 24 now. 25 to. 26 A. Please, now? He can take advice if he wants Yes. 27 MR. GORE GRIMES: Yes. 28 JUDGE O'LEARY: However, I am not getting 29 1 2 MR. GORE GRIMES: Yes. 3 JUDGE O'LEARY: Mr. Byrne, I understand 4 that you are not the 5 Trustee. 6 the Trustees has to exercise their own judgment in 7 these matters separate from you but you can fire the 8 Trustees at your whim. 9 which we have agreed is in place. I understand that and I understand that I mean that is the structure So, it is 10 disingenuous of you to say that you cannot get 11 the information. 12 MR. SHIPSEY: Sorry, could I just come 13 in there? 14 15 JUDGE O'LEARY: A 16 No. No, no, no, I ...(INTERJECTION). MR. SHIPSEY: And may be we need to 17 take a break. 18 A 19 119 Q 20 A 21 120 Q 22 A 23 121 Q 24 A 25 122 Q 26 A I think I can answer that, Judge. JUDGE O'LEARY: Yes? We have had the same problem with Moriarty. I know that? And it...(INTERJECTION). I have read that evidence? And it has been...(INTERJECTION). The Moriarty evidence? And it has been a pain in the neck. So, we decided, 27 "Well, there is only one way to solve this one. 28 Get on the plane and head out to Cayman". 29 getting nowhere. We were We made several several attempts. 1 We wrote several letters. 2 never responded to anything that we wrote. 3 decided, 4 less at the behest of Moriarty's Tribunal; that we 5 decided we would go out there and Anthony and 6 myself, Anthony Gore Grimes and myself, went out and 7 we spent a couple of days there but we were -- there 8 was plenty of chat and plenty of guff and plenty of 9 everything else but there was no cooperation We rang him up and they "Well, we would go out there," So, we more or 10 whatsoever. 11 with the Tribunal; no way they would. 12 then -- we employed a local barrister or solicitor 13 to investigate the whole thing. 14 think the following day or may be a week after 15 with his advice that whoever the Trustees were, 16 that would be appointed, would be no better than 17 the Trustees that are already there. 18 wouldn't provide the information and that is as -­ 19 so, we came back with our tail between our legs. 20 123 Q. 21 A. They said they would not cooperate 23 be no better than the old ones. 25 A. 26 125 Q. They still You could fire the Trustees, yes, Judge, but what -­ the advice we got was: 124 Q. He came back I However, Mr. Byrne, you can fire the Trustees? 22 24 We employed The new Trustees would However, it depends on who the new Trustees were? Well, they would be obviously Cayman residents. You see the Confidential Relations Preservation Law 27 1995, dealing with the question of disclosure of 28 these things, has no application to disclosure by 29 a professional person acting in the course of 1 2 So, all it requires is for the Trustee, whoever 3 the Trustee may be, to issue the instructions 4 and then it will be done; that is all? 5 A. 6 12 6 Q. 7 8 And if he will not do it you can go and change the Trustee? A. 9 10 But... (INTERJECTION) . Well, this is what Mr. Moriarty was endeavouring...(INTERJECTION). 127 Q. 11 All right. I understand that. We will leave that to one side any ways? 12 A. 13 128 Q. 14 A. 15 129 Q. 16 A. 17 130 Q. 18 A. 19 131 Q. Yes. I understand your position? Yes. And I think you understand ours? I do, indeed. All right, Okay? I do, indeed. All right, Okay. I will not proceed any more 20 with that. 21 accounts of which the J accounts are only just 22 typical because they are the ones we happen to have? 23 A. 24 132 Q. Mr. Byrne, I am going back to the Yes. However, of course there were ones prior to the 25 change over in 1989 as well as the ones afterwards. 26 However, did you get statements or did any person 27 that you know get statements of how much money was 28 in these back to back loans? 29 A. Yes, yes. I always got statements when Des was 1 alive. 2 133 Q 3 A Yes ? I mean he would probably ring up and say, "Well, 4 come in," and he would have the statements and I 5 would probably sign them and they would be sent 6 back but since Des died things seemed to have 7 changed and I think they are sent into the 8 secretary now and they sign them. 9 134 Q Yes. I am not talking about the accounts. 10 talking about statements. 11 like an ordinary bank statement. 12 bank statements from them? 13 A 14 135 Q 15 16 I am I am talking about -­ Did you get Bank statements? For the back to back loan, which was earning interest? A 17 I think I would have got -- I certainly would probably have got a view of them. 18 136 Q 19 A 20 137 Q 21 A 22 138 Q 23 A 24 139 Q 25 A view of them? Yes . And did you retain them; would you say? No. You did not retain them? No, no. And do you remember whether they were on a particular headed notepaper or not? 26 A 27 140 Q I can't recall. Yes. Some people say they were on headed notepaper. 28 Some people say they were not on headed notepaper. 29 Do you remember in your case? 1 2 You do not remember. 3 Mr. Collery took over and it was a Hamilton Ross 4 exercise -- we have to go into the legal effect of 5 that later but I am not going to go into that today. 6 That can be gone into with your legal advisors in 7 due course. 8 that I showed you there today from him? 9 A 10 142 Q 11 A 12 143 Q 13 A Fair enough. Tell me: Did you get statements of the kind No, no. You never got them from him? No. I see? The first time I ever heard of Hamilton Ross 14 was when it came up, it cropped up, in the 15 Moriarty Tribunal. 16 144 Q 17 When Yes. I am not really concerned about what name was at the top of it? 18 A 19 145 Q I see . Really we are not interested about that because 20 names change from time to time. The company 21 itself had three or four names. I am really 22 concerned in: 23 A 24 146 Q 25 A 26 147 Q 27 A 28 148 Q 29 A Did you get statements of that type? No. No, you did not? No, no. Fair enough. From Mr. Collery? No. Or any of his minions we will say? 1 All right, Okay. 2 memory, and you can only go from your own memory of 3 course, how would the typical loan be arranged with 4 the cash backing? 5 project in mind. 6 to Des Traynor or what? 7 A Could you tell me from your You wanted a project. You had a Did you go to Des Traynor or say Well, with the back to backs really I suppose I 8 always considered that it was a legitimate form 9 of bank security strictly and I also was 10 aware...(INTERJECTION). 11 150 Q 12 A 13 151 Q I am not saying it was not. That is not my point? I see . I am talking about a different thing. I am talking 14 about when you went in to borrow money from Guinness 15 & Mahon; all right? 16 A 17 152 Q 18 Yes . That had to be arranged somewhere. Who did the arranging? 19 A 20 153 Q 21 A 22 154 Q Des . All right. Did you go in and talk to Des? I would have done, yes. All right, Okay. You would have said, 23 "Mr. Traynor," or, "Des," or whatever you wanted to 24 call him, "I need half a million pounds"? 25 A 26 155 Q Exactly. All right, Okay. Sometimes it was a new half 27 a million pounds and sometimes it was rolling up an 28 old situation, which is very common in the property 29 area; is that not right? 1 2 156 Q 3 So, you say to Des, "I want half a million pounds"; to Mr. Traynor? 4 A 5 157 Q 6 7 I understand. Yes . What did he do then? To your knowledge now what did he do? A Well, with Des he was the sort of man that nothing 8 was a problem as far as he was concerned to 9 everything. 10 158 Q 11 A Yes ? But with -- I do remember something about Des 12 getting the Trusts involved in some form of back 13 to back. 14 159 Q 15 A 16 17 Yes? But I cannot for the life of me recall all the nitty-gritty that was involved in the transaction. 160 Q Yes, but I am not really concerned about, shall we 18 say, those details. 19 typical loan; you want a half a million pounds; you 20 go into Mr. Traynor; Mr. Traynor says to you, "I 21 will arrange it". 22 A However, I am just saying a When do you next go back to him? Well, you might say now, before anything happened, 23 he would say, "Right, I will arrange that," you 24 know? 25 161 Q 26 A 27 162 Q All right. So, he would give you verbal approval? Yes, exactly. When he said that was he acting as a Guinness & 28 Mahon man; as one of your Directors; or as an 29 Ansbacher man; do you think, or a bit of all? 1 Well, I couldn't answer that, Judge, but 2 certainly he would be I suppose combining the 3 whole lot. 4 163 Q 5 A 6 164 Q 7 A 8 165 Q 9 Combining the...(INTERJECTION)? Combining the whole lot. That is what you felt any way? That is what I felt, yes. All right. Fair enough. I understand. So, then we have many examples, and I am going to give you 10 one I think, of the type of letter which was sent. 11 It is called a facility letter but this is only an 12 example? 13 A 14 166 Q 15 A 16 167 Q 17 A 18 168 Q 19 A 20 169 Q Yes, yes. You understand? I know, yes. There is no point in me going through 25 examples? Yes, yes. Because they are all the same? Yes, yes, yes, yes. I am looking at a facility letter which is 21 at page 198 of our brief, which is dated the 22 30th April 1982, Exhibit 3. 23 Trust borrowing and it was for £900,000. 24 in this case it was a roll over really of a 25 loan effectively but it was a new loan and it 26 was to repay a facility originally availed of 27 in March 1972 28 you could not possibly remember that individual 29 one, Mr. Byrne, but is that typical of the kind It was a Carlisle (Same Handed), Exhibit 3. In fact I know 1 of letters that would have been put in place as 2 a result of your request? 3 A. 4 5 Yes, I think -- I would be -- it would be fair to say that it was. 170 Q. 6 Yes. Could I say to you that I have looked through them all, Mr. Byrne? 7 A. 8 171 Q. 9 Yes. All that I have, Mr. Byrne, and I can say to you that, except insofar as one matter is concerned, 10 they appear to me to be almost identical. 11 one matter which changes is: 12 different security; sometimes the guarantee is by 13 yourself; and sometimes it is between yourself and 14 your wife. 15 and your wife; all right? 16 A. 17 172 Q. 18 A. 19 173 Q. 20 The Sometimes there is a In that particular case it is yourself Yes. Would you accept that that was the normal situation? I would say so. Sometimes it was you and sometimes it was yourself and your wife? 21 A. 22 174 Q. Yes, I would say so, yes. Right, Okay. You will see that nowhere in that 23 letter does it make any reference to a back to back 24 facility. 25 can take it from me that there was a back to back 26 facility for that loan; we will come to it later. 27 However, you can take it for the moment for the 28 purpose of my question that there was a back to 29 back facility for that loan and it is not mentioned Did you ever notice that yourself? You 1 2 A. 3 175 Q. 4 Yes. It was never mentioned in any letter that I could see? 5 A. 6 17 6 Q. 7 A. 8 177 Q. 9 A. 10 178 Q. 11 12 I can't explain it. I see, yes. And did it ever strike you as odd? No. No, or unusual in any way? No. Does it strike you as odd now that I have put it to you like that? A. Well, when you point it out it does but certainly 13 when this was -- when -- Des was my financial 14 advisor. 15 179 Q. 16 A. 17 180 Q. I know. I know? I more or less didn't question anything like that. Mr. Byrne, this may be a potential criticism of 18 Guinness & Mahon. 19 criticism? 20 A. 21 181 Q. 22 I am only saying a potential Yes, yes. Because they may have a very logical explanation for it? 23 A. 24 182 Q. 25 Yes. At the moment it is a potential criticism of Guinness & Mahon? 26 A. 27 183 Q. 28 A. 29 184 Q. Yes. It is not a criticism of you; do you understand? I do, indeed, Judge, yes. However, I am saying to you as a 1 2 3 Yes . 185 Q Would it not be your experience that if a loan was 4 backed by cash that is the best kind of backing you 5 can get; is it not? 6 A 7 186 Q 8 A 9 10 Well, that would be but certainly...(INTERJECTION). And...(INTERJECTION)? Well, certainly I wouldn't have had -- I probably wouldn't have -- I would have read it and let it go. 187 Q 11 Yes. I am not criticizing you, Mr. Byrne, in that regard at all? 12 A 13 188 Q Yes . What I am saying to you is: As an experienced 14 businessman would you accept that it is unusual 15 for the best security not to be mentioned at all? 16 A Well, I suppose there has -- looking at it in 17 retrospect I suppose you would have to think 18 that way. 19 189 Q All right, Okay. Fair enough. That is not a 20 criticism of you now, I want to make that clear, 21 and it may not be even a criticism of Guinness & 22 Mahon because they may have a perfectly logical 23 explanation for it, which I have not asked them 24 about yet; all right? 25 A Fair enough. 26 If you look at -- the signature is at the end of 27 that, Exhibit 3: 28 29 "Pat 0'Dwyer," 1 2 and I think the man was Rue Leonard, was he; what 3 he was known as? 4 Yes, that is right. 5 191 Q Did you know both of those? Were they — how 6 did they figure in the scene as far as you were 7 concerned? 8 A 9 Well, they were -- they were -- they did hold some -- I suppose you could call them Assistant Managers. 10 192 Q 11 A 12 193 Q 13 A 14 194 Q Yes ? Or Assistants in the Lending Department in there. Yes ? But I knew both. In the hierarchy in Guinness & Mahon at that stage 15 was Des Traynor higher or lower than Rue Leonard 16 and Pat O'Dwyer? 17 A He was, yes. 18 195 Q He was what? 19 A 20 196 Q 21 A He was higher; was he? He was higher, yes. I see. So, I can put it in that context? Well, put it like this, Judge: That Des was 22 telling everyone in there what to do or what 23 not to do. 24 197 Q 25 A 26 198 Q 27 So, he was running the show? Exactly. I mean whatever his title he was running the show as far as you were concerned? 28 A 29 199 Q Yes . If you actually look at the next sheet of paper 48 1 you will see why I picked that particular one 2 because I had a specific memo dealing with it. 3 This was given to us by Guinness & Mahon. 4 source of this document is Guinness & Mahon. 5 This is a memorandum, Exhibit 4, which is at 6 page 196 of our documentation, and that refers 7 to the back to back loan. 8 there at that Carlisle Trust: The So, if you would look 9 10 "We have participated to the extent of 100% in this Guinness & Mahon Limited Dublin facility which is backed by a matching deposit with GM Cayman Trust redeposited with ourselves." 11 12 13 14 I think for some reason they were using both Irish 15 and English banks and routing it through an English 16 bank to the Irish bank. 17 about. 18 A. 19 200 Q. That is what that is all Do you know anything about that? Not much. Not much about it. Yes, all right. Fair enough. 20 The next one is a memo from Mr. Traynor; again 21 given to us by Guinness & Mahon and no doubt in 22 due course they will swear that that is true, 23 Exhibit 5. 24 of documentation and it is: It is at page 197 of our schedule 25 26 27 "To: From: Mr. D. Robson. J.D. Traynor." 28 29 Do you know who Mr. D. Robson was? 1 2 201 Q 3 He may have been a London operator. You did not know him any way? 4 A 5 202 Q 6 No, never heard of him. All right. However, you can see any way that it deals with the stg£900,000 loan; do you see that? 7 A 8 203 Q 9 Yes . All right. I note that he talks about Central Bank approval and all that. 10 That is all down there in it? 11 A 12 204 Q Yes . Yes, I see. So, as far as you were concerned 13 you would have asked Mr. Traynor; Mr. Traynor 14 would have arranged it; you would have signed the 15 facility letter; presumably you would have signed 16 the Letter of Offer when you got it but in any event 17 you would have signed the personal guarantee; both 18 yourself and sometimes your wife? 19 A 20 205 Q That is the system? 21 A That is the system. 22 206 Q Yes . However, the details of how he actually routed 23 the money or anything like that: 24 to that at all? 25 A 26 207 Q 27 A 28 208 Q 29 Were you party No, no. You had not anything to do with it? No. However, you do know that there was matching funds somewhere from the Cayman to back it? 1 A. 2 Well, I would have known that there was back to back. 3 209 Q. Back to back, yes? 4 A. I would of course. 5 210 Q. Yes. Sometimes the funds were in Ireland, sometimes 6 they were in England but they were somewhere; all 7 right ? 8 A. 9 211 Q. 10 A. 11 212 Q. 12 A. 13 213 Q. 14 15 They were -- I assume they were somewhere. They were somewhere? Yes, yes. And they could get access to them? Yes, yes. Like all bankers that is what they really want; is access to the money if they need it? A. Well, they weren't -- at times on various buildings 16 there might be an over run or something would be 17 needed something would -- we would need cash for 18 builders and Des was the one to arrange it. 19 214 Q. Ultimately, Mr. Byrne, the position in your 20 structure, in your Irish structure, is that you 21 control the structure but you do not own the 22 structure? 23 A. 24 215 Q. 25 A. 26 216 Q. 27 A. 28 217 Q. 29 That is correct. I think that is your position? That is my position. Is that a fair summary of the position? That is a fair summary, Judge. Yes, you control it but according to the way you 1 A 2 218 Q 3 A 4 219 Q Exactly. You have, indeed. All right. Why should somebody who controls 5 something but does not own it give a personal 6 guarantee; as an experienced businessman I am 7 asking you that question? 8 A 9 Well, that is a question now that I would have to say I find difficulty in answering because 10 11 Yes. there...(INTERJECTION). 220 Q 12 Mr. Byrne, that is why I ask it because I find it difficult to understand it you see? 13 A 14 221 Q 15 A 16 222 Q 17 A 18 223 Q 19 A 20 224 Q 21 A 22 225 Q 23 Yes, I almost find it difficult as well, Judge. Yes? But there must be some good explanation for it. There must be. I do indeed. However, you appreciate the point? I do indeed, yes. You control it I accept? Yes . Now whether you own it or not -- you say you do not? Yes . And for the purpose of this question I am accepting you do not own it? 24 A 25 226 Q Yes . I mean I am accepting it for the purpose of the question? 26 27 A 28 227 Q 29 A Yes . Yet you personally guarantee it? 1 228 Q. 2 A. Which is out of your own personal wealth? The only answer I can give to that is it might 3 have been, you know, take it or leave it and there 4 might have -- if there was probably a rush to get 5 the borrowing cleared that is what I did. 6 229 Q. Mr. Byrne, that cannot be right because I have 7 dozens upon dozens upon dozens of facility letters 8 all saying the same thing? 9 A. 10 230 Q. 11 Yes. Sometimes with yourself and sometimes with your wife? 12 A. 13 231 Q. Yes. However, they are all personally guaranteed by 14 you and I am just seeking to understand how a 15 person would personally guarantee money for a 16 structure that he does not own. 17 Carlisle Trust. 18 of Carlisle Trust? 19 A. 20 232 Q. 21 A. Yes. 22 233 Q. Yes. 23 You did not own You were an employee presumably Yes, yes, yes. You were drawing a salary from it? You had some control over it through your A shares? 24 A. 25 234 Q. 26 A. 27 235 Q. Yes. However, you did not own it? Well, it is an interesting point. Yes, all right. I note your answer in that regard. 28 You have said to me that Tristan is the Trust in 29 the Cayman that has the hard ready cash and I have 1 2 3 Yes, yes. 236 Q 4 And that is why I was able to pick it up and I merely got you to confirm it? 5 A 6 237 Q Yes . How could Tristan give a back to back facility to 7 Carlisle when it was in a different structure and 8 had no relationship with it? 9 A 10 11 Well, this is a point that -- I was aware that Des did involve Tristan in a back to back borrowing. 238 Q 12 It had to be Tristan. Sure it was the only one with money? 13 A 14 239 Q 15 A That is right, yes. It could not be anybody else? And -- but as I said I do not know or could not 16 possibly remember what all the details were or 17 how it came about. 18 240 Q No, I understand that. I am not asking about the 19 details. 20 businessman: 21 property; one owned by Tristan? 22 A 23 241 Q I am just asking you as an experienced You have two different streams of Yes . Forget who is the beneficial owner. Forget all 24 that. 25 Trustees, and one owned by Prospect and yet 26 Tristan uses its money to give a guarantee for 27 the borrowing of a structure to which it has 28 no relationship? 29 Well, that was something that Des Traynor did One is owed by Tristan, with its own 54 1 2 242 Q 3 A 4 243 Q 5 A 6 244 Q 7 You cannot? Can't give you the reason for it. Yes. Obviously the Trustees must have agreed to it? Well, they obviously did. Yes. Do you have any record of the Trustees agreeing to it? 8 A 9 245 Q 10 A I have no record, no, Judge. Can you get a record of the Trustees agreeing to it? But as far as I know -- at that particular time I 11 don't know how involved Des Traynor was with the 12 Trustees. 13 246 Q Yes. However, did City -- I want to get the name 14 right. 15 borrowing -- they were not the only company that 16 was borrowing but I am just taking this as a 17 typical one? 18 A 19 247 Q Did Carlisle Trust Limited, which made the Yes, yes. Did Carlisle Trust ever make a payment to Tristan 20 in compensation for having done this extraordinary 21 thing? 22 A 23 248 Q 24 Your solicitor is shaking his head as if to indicate that it is not but I do not know that? 25 A 26 249 Q 27 A 28 250 Q 29 I can't remember. I ...(INTERJECTION). I cannot put that on the record? Yes, yes. However, I mean you would know that as a Director of Carlisle? 1 A. 2 Well, I would but it is so long ago now I can't tell you the details. 3 251 Q. 4 A. 5 252 Q. 6 A. 7 253 Q. Yes, but you can...(INTERJECTION)? But... (INTERJECTION) . Yes. However, you could look that up? I could look it up, yes. Yes. Would you tell -- that is the question I 8 want to ask: 9 Carlisle and would you see if it ever made a Would you look at the records of 10 payment to Tristan Securities in respect of what 11 was an extraordinarily generous backing facility 12 bearing in mind that there was no relationship 13 between them at all? 14 A. 15 254 Q. Yes, I will indeed. You see, Mr. Byrne, one of the conclusions that 16 I have to consider, and it is only one of the 17 conclusions, is that this whole thing was a sham; 18 do you understand? 19 A. 20 255 Q. I do. And that -- what I am trying to find out you see 21 is who the client of Ansbacher was. 22 effectively saying to me is, "It was these companies 23 who were the clients," and I need to understand 24 that position and that you were not the beneficial 25 owner and that you were not the owner. 26 should report in due course that the client of 27 Ansbacher were Prospect or Tristan as the case 28 may be. 29 conclusion with the other Inspector who will What you are So, I However, if I was to come to the 1 be dealing with this particular aspect of this, 2 who is Mr. Paul Rowan by the way; I forgot to 3 introduce him to you. 4 view with him -- I could conceivably, 5 saying that because I have my mind completely open 6 on it, come to the view that the whole thing was a 7 sham and that proof or evidence that it was a sham, 8 and that you were always personally in control of 9 the money, was that one independent unit without 10 any benefit guaranteed the borrowings of another 11 independent unit. 12 working? 13 A. 14 256 Q. 15 16 Yes, I can. If I was to come to the I am not Can you see the way my mind is Yes, I can. Have you anything -- do you want to say anything to me about it? A. 17 Well, certainly I will have to go back to the records. 18 257 Q. 19 A. 20 258 Q. 21 A. 22 259 Q. 23 A. 24 260 Q. Would you...(INTERJECTION)? To Carlisle Trust and see. All right. Would you do that? Would you do that? Yes. I would greatly appreciate it? I will indeed. Because it appears to me, looking at the thing as 25 objectively as I can, that if Mr. Rowan here was 26 borrowing money and I was to guarantee that? 27 A. 28 261 Q. 29 Yes. I am talking about -- I am not talking about borrowing money for a car. I am talking about a 1 2 3 Yes . 262 Q And I was to guarantee it I would expect to get some 4 benefit for it or I would not do it unless his 5 interests and my interests were identical. 6 you see the point? 7 A I can indeed. Oh, yes. Can Well, all I can say, 8 Judge, is that I took advice from the best people 9 I could -- as were available to me. 10 263 Q 11 A 12 264 Q Mr. Byrne...(INTERJECTION)? And I was reliant entirely on them. Mr. Byrne, nobody has suggested, I hope they 13 never will, that you did not act on professional 14 advice. 15 see one of the things that I have to consider is 16 whether the professional advice was good enough or 17 not? 18 A 19 265 Q 20 A 21 2 66 Q Nobody has suggested that. However, you Fair enough. Do you understand the point I am getting at? I do, I do, I d o . Whether it achieved the desired objective or 22 whether the whole system broke down and that is 23 only in the context of because I have duty, we have 24 a duty, to decide who the clients of Ansbacher were. 25 It is only: 26 I going to put the company's name down? 27 what this is all about? 28 A 29 267 Q Am I going to put your name down or am Yes, yes. It is not about anything else? This is 1 2 3 wrong. 4 not because no matter what conclusion I come to 5 it has nothing to do with the tax authorities; 6 do you understand? 7 A. 8 269 Q. 9 A. 10 270 Q. 11 A. 12 271 Q. It is not about whether he owes taxes or Yes. They have to make their own case? Yes. Do you understand? I do indeed. So, really what I am focusing on is: I must 13 determine who the client of Ansbacher was and that 14 is the only purpose of my line of questioning. 15 is not to criticize you in any way, Mr. Byrne; all 16 right? 17 A. 18 272 Q. It Thank you. If you want to give me any further information on 19 that you can do it through your solicitor. I am 20 hopeful that this will be our last interview but 21 I cannot guarantee it but I am hopeful that it is 22 because you have been extremely helpful in the way 23 in which you answered the questions. 24 time different -- I am moving on to a different 25 point altogether; away from that point. 26 to time different Directors of Carlisle and the 27 other associated companies signed the accounts. 28 You signed them sometimes and I think other people 29 signed them. From time to From time Obviously I can theoretically hold you 1 responsible for every time they were signed because 2 you were a Director all the time but I am more 3 interested at the moment in the time you signed 4 them. 5 the records available to me -- and if there are 6 other records with regard to Carlisle I am more than 7 willing to look at them. 8 the accounts of the company never disclosed the back 9 to back facility and I am further advised that at Insofar as I have been able to ascertain from As far as I am concerned 10 least after 1986 this was wrong. 11 bring that to your attention? 12 A 13 273 Q Did anyone ever No. Right, I see. That the securities which had been 14 given, or on which loans were taken out by the 15 company, the note on the balance sheet should 16 include all such securities including the back to 17 back loan. 18 but others were not. 19 that, Mr. Byrne, I want to explain to you, is not 20 because I want to say, "Mr. Byrne did anything 21 wrong," but I am trying to work out if I possibly 22 can what went on in the mind of the late Mr. Traynor 23 because the auditors of your company wrote on a 24 number of occasions and the back to back loans were 25 never mentioned to them either. 26 criticizing your auditors in any way; you understand 27 that? 28 A 29 274 Q You see some securities were included The reason I am asking you So, I am not I do. So, the letters which they got from Guinness & 1 Mahon, under presumably the control of Mr. Traynor 2 who was the operative there at that time, did not 3 mention the back to back nature of the facility 4 and of course then it was not included in the 5 accounts for that reason. 6 ever ask you about any peculiarity like that? 7 A 8 275 Q 9 Did the auditors I don't recall ever been asked anything like that. Nothing like that, fair enough. I think you have given evidence in your statement, Exhibit 1, which 10 you have now adopted, right, and which is now a 11 sworn statement for that reason, of the fact that 12 you acquired no personal benefit from the monies 13 held in Cayman? 14 A That is correct. 15 276 Q That is correct. I would like to give, Mr. Byrne, 16 a sheet of paper which is part of the extracts from 17 the J account, Exhibit 6. 18 at the moment I will call it a Hamilton Ross 19 Statement. 20 was but for the sake of argument it is a Hamilton 21 Ross Statement. 22 (Same Handed)? 23 A 24 277 Q For the sake of argument We could have arguments about what it I would like you to look at that Thanks. No, that is not the one. It is the one with -- I 25 think that is the wrong one. 26 the wrong one. 27 If you would hand him my one there 28 Exhibit 6? 29 Okay. I think you have got It is nothing to do with that. (Same Handed), 1 278 Q. I wonder would you put a mark on that to indicate -­ 2 you might call it "number 1". 3 "number 1" on it? 4 MR. GORE GRIMES: Yes. JUDGE O'LEARY: That is grand. 5 279 Q. 6 Would you just write I think what Mr. Rowan is going to 7 do is he is going to get his own copy of it because 8 then we will have enough copies for everybody. 9 see that? 10 A. 11 280 Q. Yes. There was a draft for £3,500 taken out of that 12 and that draft appeared to go to someone by the 13 name of John Byrne. 14 A. 15 281 Q. 16 You Did you get that draft? I just can't recall. You cannot recall. Is it possible that you got the draft, Mr. Byrne? 17 A. 18 282 Q. Yes. In order to help you I have a second sheet of paper, 19 which is a printout of the principal ledger of the 20 Ansbacher Cayman call deposit account in which the 21 same draft is printed out a few days previous to 22 that and that was the system that operated and you 23 can see the £3,500 is clearly indicated to you. 24 Have you got that, Exhibit 7? 25 MR. GORE GRIMES: 26 A. 27 283 Q. 28 29 Yes, yes? Yes. JUDGE O'LEARY: You can have another copy of it, Mr. Shipsey (Same 1 2 JUDGE O'LEARY: We might call that 3 "number 2". 4 5 284 Q. MR. GORE GRIMES: "Number 2"? JUDGE O'LEARY: Yes. 6 You can see that it is quite clearly indicated 7 that it was for John Byrne. 8 not trying to trick you. 9 So, I am going to give you a third sheet of paper 10 as well and that might be called "number 3" (Same 11 handed)? 12 A. 13 285 Q. 14 Now, Mr. Byrne, I am I want to make that clear. Thank you. And this we got from the Irish records of Ansbacher. You can see where it is headed "Ansbacher": 15 16 "Please reply to: 42 Fitzwilliam Square, Dublin 2." 17 18 19 It is 1990. 20 at that stage. 21 Mr. Humphries which says: I think he probably had left the bank It is an instruction or a request to 22 23 24 25 26 27 28 29 "I wonder would you be good enough please to organise a Sterling Draft payable to John Byrne in the sum of Stg.£3,500 and debit Ansbacher Limited Account No. 13154602. I would like to have Andy pick this up in the morning (Tuesday) if at all possible and am therefore sending you this letter by fax. The original will follow by hand in the morning"? 1 2 286 Q. Yes, I understand that. However, unless you can 3 give me another explanation, and that is all I am 4 saying at the moment, 5 to assume that you had access to those funds? 6 A. 7 287 Q. I would in my view be entitled Well, I never knew I had access to those funds. Yes. I understand that that is your evidence and 8 I appreciate that but you got £3,500. 9 reason that I could see and therefore I am asking There is no 10 you for a reason why you should receive £3,500 from 11 one of the Cayman structures. 12 for the Cayman structure. 13 of the Cayman structure. 14 the Cayman structure. 15 them; that is the question I want to ask you? 16 A. 17 288 Q. 18 A. 19 289 Q. 20 A. 21 You did not do work You were not a Director You had no business with How could you get £3,500 from I just can't recall the structure. Yes, I see? In any shape or form. Fair enough. I see? Is there any...(INTERJECTION)? MR. GORE GRIMES: 22 Could I have a word with Mr. Byrne? 23 JUDGE O'LEARY: Certainly, of course. 24 MR. GORE GRIMES: Yes . 25 JUDGE O'LEARY: Of course. 26 Would you like us to leave? 27 MR. GORE GRIMES: No, no, not at all. 28 JUDGE O'LEARY: Yes . 29 1 Mr. Byrne that he should 2 ask you for time to inves tigate that matter. 3 JUDGE O'LEARY: Of course. 4 MR. GORE GRIMES: And come back to you on it. 5 6 JUDGE O'LEARY: Of course, you can. 7 MR. GORE GRIMES: Rather than leave it up in 8 the air. JUDGE O'LEARY: 9 10 Yes. Of course you can come leave and come back. 11 MR. GORE GRIMES: Yes . 12 JUDGE O'LEARY: Of course you can come back to me. 13 14 MR. GORE GRIMES: 15 A 16 290 Q Thank you, Judge. JUDGE O'LEARY: 17 Of course you can come back to me? 18 A 19 291 Q 20 Yes . Everything you say to me here today, if you feel you have to change, of cours 21 A 22 292 Q you can come back to me? Okay, thank you. Now, that may give rise o the necessity for another interview or it :.ay not? 23 24 A 25 293 Q Yes, yes, yes. However, of course, all am looking for is an explanation? 26 27 A 28 294 Q 29 Yes . Yes . There is one other puzzl m g thing or there would be two others really? 1 2 295 Q However, one other puzzling thing about the 3 J accounts: 4 straightforward? 5 A 6 296 Q Most of them are perfectly Yes . One other puzzling thing about the J account is 7 that somebody's American Express was being paid 8 out of the J accounts; do you know who? 9 A 10 I can't recall well now but I certainly would -­ we will have to look in to those too; certainly. 11 297 Q 12 A 13 298 Q 14 I do not know as yet whose American Express it was? Yes, yes. And therefore I thought I would short circuit it by asking you? 15 A 16 299 Q Yes . Now, if you do not know I will have to investigate 17 myself elsewhere and of course if you could 18 investigate so be it. 19 Express card yourself, Mr. Byrne? 20 A No. 21 300 Q No. 22 A 23 Do you have an American So, it was not you? Well, I haven't -- I have no -- I did have a. ..(INTERJECTION). 24 301 Q 25 A 26 302 Q 27 A 28 303 Q 29 A Diners ? A Diners at one time. Yes. No, this is an American Express? Yes . Quite clearly American Express? 1 304 Q 2 A 3 305 Q 4 A 5 306 Q AMEX which in all banking terms? Yes, yes. Is known as American Express? Yes . There are many examples of it but you can take it 6 from me that you were entitled -- well, whether 7 you were or not entitled to it. 8 our solicitor, Ms. Cummins, can make available any 9 number of examples of the American Express 10 references ? 11 MR. GORE GRIMES: 12 A 13 307 Q 14 A 15 308 Q 16 A 17 309 Q I can -- we can -­ Yes. Okay. JUDGE O'LEARY: And post it on to you? Yes . As part of it. I have them all here in front of me? Yes . However, I mean I am not going to go through them 18 all because that is not the purpose of it. 19 not an exercise to see who has the best memory; that 20 is not it? 21 A 22 310 Q 23 It is Okay. That is not the purpose. MR. SHIPSEY: 24 Perhaps, you might just indicate the period of 25 times just so that we can make enquiries? 26 JUDGE O'LEARY: 1991 - 1989. 27 MR. SHIPSEY: Right. 1989 to 1991. 28 29 have those (indicating) 1 any way because she will send you a copy of them, 2 Exhibit 9. 3 MR. SHIPSEY: Yes. 4 MR. GORE GRIMES: Yes, absolutely. 5 JUDGE O'LEARY: It will effectively be a 6 copy of the Hamilton Ross 7 account in which it is mentioned. 8 MR. SHIPSEY: Yes, fine. 9 JUDGE O'LEARY: One of the J accounts. MR. GORE GRIMES: Yes, the number -- not 10 11 necessarily Hamilton Ross. 12 The number one. 13 JUDGE O'LEARY: Whatever they are. 14 MR. GORE GRIMES Whatever they are. 15 JUDGE O'LEARY: Whatever they are. The J accounts. 16 17 MR. GORE GRIMES: Yes, the J accounts. 18 JUDGE O'LEARY: I only use Hamilton Ross as a short them for the 19 20 moment. 21 said were in the beneficial ownership of, we will 22 call it, the Cayman Structure for the moment. 23 MR. GORE GRIMES: Yes . 24 JUDGE O'LEARY: Yes, all right. 25 MR. GORE GRIMES: Yes, I Accounts produced by Mr. Collery which he think...(INTERJECTION). 26 27 JUDGE O'LEARY: Associated with Mr. Byrne. 28 MR. GORE GRIMES: These are the memorandum 29 accounts. They were 1 normally referred to as the memorandum accounts. 2 JUDGE O'LEARY: 3 All right, the memorandum accounts. However, they 4 are there (indicating). 5 MR. GORE GRIMES: Yes. 6 JUDGE O'LEARY: They are there. 7 MR. GORE GRIMES: Perfect. 8 JUDGE O'LEARY: And you will get copies of 9 those with the American 10 Express references on it. 11 MR. GORE GRIMES: Good. 12 JUDGE O'LEARY: And they relate to 13 1990/1991. It is a 14 puzzlement to us as to why that should be the case. 15 MR. GORE GRIMES: 16 A 17 Yes. Yes, yes. JUDGE O'LEARY: 18 Because it is an unusual thing to pay out of it. 19 A 20 311 Q 21 A 22 312 Q Yes . That is the reality of it? Yes, yes. There is one other matter. Were the Trusts which 23 were established in 1971 -- I do not want to know 24 numbers. 25 Trusts that were established in 1971 -- they were 26 obviously given assets at that time; be they big or 27 small. 28 ever supplemented thereafter with other assets? 29 I am not interested in numbers. I do not want to know. Were the However, were they 1 313 Q 2 No. If you like they have been a stand alone facility since then? 3 A 4 314 Q That is my understanding. Your understanding, I see. Fair enough. 5 familiar, Mr. Byrne, with a venture called 6 Ballymadun? 7 A 8 315 Q 9 A 10 316 Q 11 A 12 317 Q 13 A 14 318 Q 15 Are you Ballymadun, yes. Yes. Is that how you pronounce it; Ballymadun? Yes . I think it -- was it a stud farm or something? It was, yes. And was it your wife's or something? Yes . Or your's or you and your wife? MR. GORE GRIMES: I wonder, Judge -- may 16 be I would just come back 17 on that last answer because it actually contradicts 18 something that is in the statement, Exhibit 1. 19 think it is unfair to leave it sitting there. 20 JUDGE O'LEARY: Which one is this now? 21 MR. GORE GRIMES: Well, just in Mr. Byrne's 22 I statement, Exhibit 1, 23 which you are now taking as a sworn statement, he 24 says : 25 26 27 28 29 "I do not have a record of the dates upon which funds were subsequently transferred to the Tristan Settlement. Such funds emanated from activities carried out in the United Kingdom by companies controlled by me in that jurisdiction. I do not have any correspondence in connection with 1 such transfers." 2 3 He made it quite clear that there were other funds 4 transferred that he does not have details of. 5 JUDGE O'LEARY: 6 matters into account 7 really. 8 MR. GORE GRIMES: 10 conflict. 11 JUDGE O'LEARY: 12 Yes . Well...(INTERJECTION). MR. GORE GRIMES: By saying now on oath because we are on oath. 14 15 I just wanted to make sure that there was no 9 13 I will take all those JUDGE O'LEARY: All I can say is, Mr. Gore Grimes, I am 16 17 really asking Mr. Byrne the question. 18 MR. GORE GRIMES: I understand that. 19 JUDGE O'LEARY: If at the end of the time 20 Mr. Byrne consults with 21 you and wants to change any of his testimony. 22 MR. GORE GRIMES: Yes . 23 JUDGE O'LEARY: He is perfectly entitled 24 to come back to me. 25 MR. GORE GRIMES: And clarify it, yes. 26 JUDGE O'LEARY: And clarify it. 27 MR. GORE GRIMES: Yes, Judge. 28 Yes, there is no 29 difficulty. 1 2 JUDGE O'LEARY: However, I do not 3 want...(INTERJECTION). 4 5 319 Q MR. GORE GRIMES: Me to interrupt you. JUDGE O'LEARY: To be interrupted, yes. 6 Who owned Ballymadun? 7 A 8 320 Q 9 A 10 321 Q 11 A 12 322 Q 13 It is in my wife's name. Your wife's name? Yes . Ballymadun? Yes . Is it your wife's alone or is it -- are you a beneficial owner of it or who is? 14 A 15 323 Q 16 A 17 324 Q No. Well, my wife is the owner. Is the full owner? Yes . All right, Okay. Then may be if you feel that 18 I should ask your wife this question I have no 19 difficulty in you telling me that but I want to 20 avoid bringing your wife in if I possibly can? 21 A 22 325 Q Yes, thank you. I have no interest in bringing your wife in to be 23 honest with you but I must find out about something. 24 I wonder would the witness be given page 1,104. 25 It is a J6 account. 26 accounts 27 A It is what you call memorandum (Same Handed), Exhibit 10? Thank you. 28 It is in our second folder. 29 that there was a lodgement of £203,841.75 to that You will see there 1 account from something that is described as 2 Ballymadun. 3 loan. 4 you what it was. 5 and put it in there, I do not know, but I would like 6 to know what it is? 7 A. 8 It may have been the repayment of a I do not know what it was. I am just asking She might have made that profit Judge, I just can't recall but if you leave it with me I will certainly check it out. 9 327 Q. 10 A. 11 328 Q. I will? I will certainly...(INTERJECTION). Of course I will leave it with you, Mr. Byrne. 12 There is no difficulty in that. 13 you help me with regard to this? 14 venture which your wife was involved in? 15 A. 16 32 9 Q. 17 18 This was a Yes. And is it a money making venture or is it just a hobby? A. Well, it was certainly meant to be a money making venture; certainly. 19 20 However, could 330 Q. 21 However, a lot of those things do not turn out like that? 22 A. 23 331 Q. 24 A. 25 332 Q. 26 A. They don't always turn out that way. All right, I understand? I can assure you. I understand? But I know there was some land sold. Some of it 27 was sold off out there and I would have to see what 28 it was. 29 333 Q. Yes? 1 2 334 Q 3 A 4 335 Q 5 Yes ? But certainly it went through a sale. When did she buy it? Do you remember when she bought it? 6 A 7 336 Q 8 A 9 337 Q 10 A 11 338 Q 12 A 13 It would be in the 1970's any way. In the 1970's? Yes . And does she still have it? Still have it, oh, yes. And she sold some of it, did she? Sold some land and it was -- as far as I know now it was quite -- doing well and not so well now. 14 339 Q 15 A Yes? Between cattle and horses I am afraid the market 16 is fairly -- the horses were very good for a while 17 but then you could run into a bad patch with -- it 18 is like a yo-yo, you know? 19 them to the wrong stallions. 20 patches and your bad ones but it was quite 21 prosperous at one time and then...(INTERJECTION). 22 340 Q 23 A 24 341 Q 25 You find that you send You have your good Did it...(INTERJECTION)? Not so prosperous at the moment. Did it borrow money from the structure; I am using that in the loose term at the moment? 26 A 27 342 Q 28 A 29 343 Q Yes . Did it borrow money from the structure at any time? I don't think so. You do not think so? 1 A. 2 that. 3 344 Q. 4 A. 5 345 Q. 6 A. 7 346 Q. 8 A. 9 347 Q. 10 A. 11 348 Q. 12 A. 13 349 Q. 14 A. 15 350 Q. 16 You will come back to me on that? Yes, yes. Yes, I will come back to you on that. And you will explain that to me? I will. That has got to be obvious; whatever it is. Exactly, yes? But... (INTERJECTION) . It does not come immediately to mind? Yes, yes. Yes. Obviously it was £211,060 Irish pounds? Yes. Do you see that there? Yes, I do, yes, yes. That is the -- the sterling equivalent at the time was Stg.£203,841.75? 17 A. 18 351 Q. 19 Yes. However, it appears to have been a lodgement of £211,060, which is denoted by "IR211060"? 20 A. 21 352 Q. 22 A. 23 24 No, I don't think so but I will come back to you on Yes. That was the way they did it? Yes, yes. Well, I would have to go back to Deloitte & Touche. 353 Q. What I would be anxious to know when you are 25 explaining that to me is: 26 also know whether 27 know the circumstances in which that money was 28 lodged effectively to a Trust because that is 29 effectively who got the money eventually. I would be anxious to -- well, I would be anxious to It 1 seems to be an extraordinary situation; that you 2 make Stg.£203,000 and that you lodge it to a Trust 3 over which you do not have any control. 4 disappointment, Mr. Byrne, I have with our interview 5 is, and I think I should be frank with you, I find 6 it a bit hard to accept that with goodwill you could 7 not get the necessary information in respect of the 8 Tristan and Prospect settlements from Cayman and it 9 is well I would say that to you so that you 10 The only understand my position? 11 A 12 354 Q Yes . Now, of course, if you want to -- in due course, 13 before we arrive at any decision, we will notify you 14 with regard to the matter but it would be unfair of 15 me if I did not at this stage say to you that that 16 is a disappointment to me. 17 disappointment if you like, you know? 18 A 19 355 Q 20 A 21 356 Q 22 A It is really the only Yes . However, it is a disappointment? Yes . Yes? Well, we will have to -- we thought we had -­ 23 Judge, we thought really that we had done 24 everything in our power to wrestle the documents out 25 of them. 26 357 Q 27 A 28 358 Q 29 Yes, I understand the point you are making? And unfortunately we hit a sort of a brick wall. Yes. Thank you very much, Mr. Byrne. have you any questions for Mr. Byrne? Mr. Rowan, 1 2 3 END OF EXAMINATION OF MR. BYRNE BY HIS HONOUR 4 JUDGE O'LEARY. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 359 Q MR. ROWAN: Mr. Byrne, I think one 5 question? 6 A 7 360 Q Yes . In your statement, Exhibit 1, to us you indicated at 8 some point 9 page 2 of your statement, at the bottom of page 2 of -- if I may just find it. 10 your statement. 11 that...(INTERJECTION). 12 JUDGE O'LEARY: You indicated 13 14 Do you have a copy of your statement, Mr. Byrne? A 15 16 Yes, it is on 361 Q I have, yes. JUDGE O'LEARY: Yes, yes. MR. ROWAN: That you had a number of 17 advisors both here and 18 across the water? 19 A 20 362 Q Yes . I believe that you also had Haughey Boland as 21 certainly auditors to some of the companies in 22 the group in Ireland? 23 A 24 363 Q That is correct, yes. Earlier you were asked by the Judge about the whole 25 issue of recording accurately the securities for 26 loans borrowed by the various Irish companies; the 27 issue of why the cash backed security was not 28 recorded in the company accounts? 29 1 And you said that this was a matter which you 2 left to Mr. Traynor to get on with advising you 3 about and that although the auditors requested 4 confirmation from Guinness & Mahon about the 5 nature of the securities; that the auditors 6 were never told about the backing deposit. 7 JUDGE O'LEARY: I think in fairness, 8 Mr. Rowan, it was I that 9 said that. 10 MR. ROWAN: Did you? 11 JUDGE O'LEARY: I did. 12 MR. ROWAN: Right, yes. 13 JUDGE O'LEARY: It was I said that. 14 I said that, yes. However, you can take it 15 that we have the information to that effect. 16 have documents. 17 MR. GORE GRIMES: Yes, I accept that. 18 JUDGE O'LEARY: Yes. 19 MR. ROWAN: I think...(INTERJECTION). 20 JUDGE O'LEARY: It does not reflect badly You can take that...(INTERJECTION). 21 on you and therefore I did 22 23 We not put the documents to you. 365 Q MR. ROWAN: Yes. I think you said 24 essentially that you did 25 not have any dealings with what the auditors asked 26 for confirmation from the bankers about; that you 27 did not know about it? 28 A 29 3 66 Q Yes . And we accept that? 1 2 367 Q What I wanted to show you was a document which we 3 have come across. 4 documents 5 A 6 368 Q This is page 687 in our file of (Same Handed), Exhibit 11? Thank you. And it is an internal memorandum from Irish 7 Intercontinental Bank from a writer by the name 8 of John Reynolds and it is dated 27th March 1992 9 and the subject is: 10 11 "Tepbrook Properties Ltd." 12 13 This memorandum outlines a meeting which the 14 writer had with Mr. Paul Carty of Deloitte & Touche. 15 Deloitte & Touche as I understand it merged with 16 Haughey Boland at some stage? 17 A 18 369 Q 19 That is correct. And Mr. Carty went to see Mr. Reynolds and outlined a proposal to him and the memo says: 20 21 22 23 "Carty advised that they would require a five year term loan which it was agreed would be secured by an Ansbacher guarantee supported by cash along with a deposit of the Title Deeds to the two properties ..." 24 25 26 And you can read on but in essence this seems to 27 demonstrate, Mr. Byrne, that Mr. Carty was aware of 28 the full implications of the back to back 29 arrangements? 1 2 370 Q 3 And Mr. Carty was a partner in Deloitte & Touche I believe? 4 A 5 371 Q He was, yes. So that in effect that meant that Haughey Boland 6 were aware of the nature, the correct nature, of the 7 back to back arrangements? 8 A 9 372 Q 10 A 11 373 Q 12 A 13 374 Q I just couldn't answer that one. Is that not the implication? That is the implication. Of what this note is saying? Yes . Thank you very much. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF EXAMINATION OF MR. BYRNE BY MR. ROWAN 1 MR. BYRNE WAS RE-EXAMINED, AS FOLLOWS, BY HIS HONOUR 2 JUDGE O'LEARY: 3 4 5 37 5 Q. JUDGE O'LEARY: Mr. Byrne, could I just 6 bring to your attention 7 there, just for the sake of completeness, that in 8 that document at the end of the first sentence: 9 10 "I was advised by Messrs. Traynor and Carty is..." 11 12 13 That the company, 14 15 "...is beneficially owned by Mr. John Byrne of Carlisle." 16 17 18 I know that proves nothing; I understand that? 19 A. 20 376 Q. Yes. However, you can take it that there are hundreds of 21 references to you being the beneficial owner of the 22 company. 23 documentation -- this is only one example. 24 any comment to make on that? 25 A. 26 377 Q. 27 You can take it that throughout the I don't have, Judge, no. Yes. It is just a rather strange thing for him to say; was it not? 28 A. 29 378 Q. Have you A strange thing, yes, yes, yes. Because...(INTERJECTION)? 1 2 379 Q 3 Because in reality the structure was that you controlled but did not beneficially own it? 4 A 5 380 Q 6 A 7 381 Q 8 Exactly, yes. That was an entirely different structure? Yes . However, you can take it that this is only typical of dozens? 9 A 10 382 Q 11 A Yes, yes. Certainly dozens of such references? Yes, yes, yes. I really can't say what is at the back of Paul Carty's mind. 12 13 383 Q 14 A 15 384 Q 16 No, this is John Reynolds? Yes . Well, it is Paul Carty's too. I suppose receiving it from -- Paul Carty giving it to John Reynolds? 17 A 18 385 Q 19 That is right, yes. Yes. You can take it that Mr. Traynor would have made similar observations? 20 A 21 386 Q 22 A 23 387 Q I suppose he would, Judge. You know? Yes . Would Mr. Traynor have thought that you owned it 24 or would he have been aware of the structure; the 25 details of the structure? 26 A 27 28 29 I can't recall that. It wouldn't have been discussed. 388 Q You cannot -- ever discuss it. enough. That is reasonable. Yes, I see. Fair I wonder, Mr. Byrne, 1 could you just stay for two minutes? 2 to talk to my colleague outside the door to see if 3 there is anything else we want to ask you? 4 Yes, I will, indeed. 5 389 Q 6 Because I want if possible to try to avoid...(INTERJECTION)? 7 A 8 390 Q 9 A Yes . You can stay there. Yes, Judge. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 I just want SHORT ADJOURNMENT We will be back in one second. 1 AS FOLLOWS: 2 3 4 5 391 Q JUDGE O'LEARY: That is grand. 6 nothing else to say; all 7 right? 8 A That is grand. 9 392 Q That is grand. 10 Thanks very much. thank you very much for you help? 11 A 12 393 Q 13 A 14 394 Q 15 A Yes . We really appreciate it? Thank you very much, Judge. I really appreciate it? Okay. 16 17 18 19 20 21 22 23 24 25 26 27 28 29 We have THE EXAMINATION WAS THEN CONCLUDED. Mr. Byrne, A. 7.35/9 0932an a (M enfo? Kerry/M7. 6/ 773,9 ENQUIRY INTO ANSBACHER (CAYMAN) LIMITED UNDER COMPANIES A C T 1990 STATEM EN T OF JOHN BYRNE Introduction ' I make this statement in responsa to the-request for assistance contained In a letter dated the 2S!h October 2CC0 item ths Inspector appointed by the High Court to . investigate tha affairs of Ansbacher (Cayman) Limited (hereafter "Ansbacher Cayman') than known as Guinness and Mahon Cayman Trust Limited pursuant to Sections 8 and 17 of the Companies Act, 1990. ' • . . I have sat out hereunder the facts with as much detail as I am reasonably able to provide given the fact that my dealings with Ansbacher Cayman commenced In 1971. Apart from the documents which I- am attaching to this statement and despite searches and enquiries which i have made, I do not have any other . contemporaneous records surrounding the establishment of the two trusts. In addition, some of the persons who advised me at the time are now dead. By way of background I was bom In County Kerry in 1919. In 1941,1emigrated to England.’. J started out like many of my compatriots in construction and eventually built up a substantial building and property development business, f also involved myself in ifta development and operation of a number of dance halls and ballrooms In tha U.K., which were focused on the large population of young Irish Immigrants In Birmingham, Coventry and London. In the eariy 1960’s at the invitation of Sean Lemass and Sean McEntee, I decided to invest in Ireland and became involved In property development My first property venture was the.construction and development of O’Connell Bridge House on D'OIIer Street in Dublin which was completed In 1964. This development was carried out through.Carlisle Trust Limited, an Irish company originally Incorporated and controlled by me. My second venture was the construction of an Apartment Block known as St. Ann’s at Aiiesbury Road. This was also carried out through Carlisle Trust Limited. My third venture was the development of D'OIIer House (the former T&C Martin premises) through another Irish company originally Incorporated and controlled by me, namely, Dublin City Estates Limited, in or about 1969. Although these ventures were carried out In Dublin my principal activities were still being carried out in tha U.K. Throughout my time in England, m y closest advisor was my solicitor, the late Arnold Finer, in Ireland i was advised by my solicitor, the late Christopher Gore-Grimes. From in or about the mid-1960s, my accountant and (later) financial advisor was the late Desmond Traynor. • I now turn to the specific information requested In Appendix C of the letter from the Inspectors: Cavman Island Trusts and Trust companies: The establishment of the Tristan* and “Prospect" Settlements:(a) The background to the establishment of what became known as the Tristan and Prospect Settlements was as follows. By 1971 my business ventures in England were substantial and as I was becoming Involved to an increasing extent in Irish property development, I was concerned to minimise my family’s exposure to what was then known as "estate duty" In the event o f my death. I took separate legal and taxation advice in Ireland and England from my respective advisors. I was advised that it was legally permissible both in Ireland and England to establish discretionary trusts domiciled and controlled in the Cayman Islands, which was at that time (1971) still part of the Sterling area. ' The trust known as the Tristan Settlement” was established in connection with my UK business and the trust known as the "Prospect Settlement" was established in connection with my Irish business. Both trusts, which were established in the Cayman Islands, were founded in such a way that they are controlled by the trustees of the respective trusts. I received legal advice that the trustees of both trusts (which trusts are governed by Cayman Law) are under no obligation to accept any instructions from me in relation to the trusts. I have requested the Trustees on a number of occasions to provide information to the Moriarty Tribunal and they have not • done so. Notwithstanding the above I am writing to the Trustees requesting them to provide information to your Enquiry.. I do not control the Trusts or the Cayman Companies owned by the. Trusts. I. do not have power to enjoy income from either. The mechanics of the establishment of the two trusts were as follows:On the 9th August 1971, the Tristan Settlement was established. The Settlor was the late John Andrew Furze and the Trust was known as the Tristan Settlement A company was incorporated in Cayman known as Tristan Securities Limited which was and is owned by the Tristan Settlement. The advice that I received in relation to the Tristan Settlement was from the late Arnold Finer Solicitor, the late Maurice Finer Q.C., the late Desmond Traynor and from the late John Furze, an executive of Ansbacher Cayman. I do not now have any correspondence relating to the establishment of the Tristan Settlement or Tristan Securities Limited but I enclose with this statement a copy Indenture of Settlement dated 9,h August, 1 9 7 1 , John Andrew Furze and Guinness & Mahon Cayman Trust Limited (the 'Tristan Settlement '); • . . On the 901August 1971, a trust known as the Prospect Settlement was established. A Cayman Island company was Incorporated known as Prospect Holdings, which was and is owned by the Prospect Settlement. I was advised in the matter of the Prospect Settlement by the late Christopher Gore-Grimes, by Counsel retained by the late Mr. Gore-Grimes, Mr. Charles Hacclus, BL and by the late Desmond Traynor. I do not have any correspondence relating to the ' establishment of the Prospect Settlement but I enclose the following with this statement: . (i) copy Deed of Trust dated the 9thAugust, 1971 John Byrne and Guinness & Mahon Cayman Trust Limited; (If) Memorandum and Articles of Association of Prospect Holdings. There were no Shareholders Agreements In respect of either Tristan Securities Limited or Prospect Holdings. (b) i attach a Statement prepared by the late Desmond Traynor on the 22nd July 1982 attaching accounts relating to the Prospect Settlement and Prospect Holdings. From this It appears that the sum of £21,000 was invested in share capital and there was a loan of £1,329.88. it appears from the Statement prepared by Mr Traynor that these sums were transferred to the Prospect Settlement in August 1971. . The shares in Carlisle Trust Limited and Dublin City Estates Limited were transferred to Ansbacher Cayman who In turn held them in trust for Prospect Holdings. The date of the transfer of the shares was the 20th day of June • 1972. I do not have a record or any correspondence in relation to funds which were transferred to the Tristan Settlement but I believe these were first transferred in 1971 and emanated from the activities cairied out in the United Kingdom by . companies controlled by me in that Jurisdiction. (c) I. believe that no further funds were transferred to the Prospect Settlement. I do not have a record of the dates upon which funds were subsequently transferred to the Tristan Settlement Such funds emanated from activities carried out in the United Kingdom by companies controlled by me In that jurisdiction. I do not have any correspondence In connection with such transfers. . I believe that in the early 1990’s a loan was provided at one stage by Tristan Securities Limited to Alstead Securities and that this loan was subsequently repaid. I am endeavouring to ascertain further details in connection with this loan. (d) I have never received or enjoyed any income or benefit from either the Tristan Settlement or Tristan Securities Limited or from the Prospect Settlement or Prospect Holdings. Nor did I have the power to enjoy any such income. (e) As appears from the Tristan Settlement deed the Settlor was Mr. John Furze. I have no information regarding the transfer of funds which was handled by the late Mr. Desmond Traynor. • (f) Letter of Wishes in respect of Tristan Settlement enclosed together with Supplementary Deed in respect of Tristan Settlement I am searching for similar documents in respect of the Prospect Settlement. (g) Communication was originally with the late Mr. Desmond Traynor who was a director of Ansbacher Cayman and was also my financial adviser. I have no record of my communications with Mr Traynor. I have been furnished with copies of correspondence between Mr. Traynor, Guinness & Mahon (Dublin) Limited and Ansbacher Cayman, which I understand the Inspectors have. Following Mr. Traynor’s death I communicated with Ansbacher- Cayman through Mr. Padraig Collery. (2) - (5) . I am advised and believe that Paragraphs (2) - (5) inclusive of Appendix C do not apply to me since no funds were transferred by me to Ansbacher Cayman. Nor was there a transfer by me to any account maintained by Ansbacher Cayman with another financial Institution. Loan facilities were provided by Guinness & Mahon (Ireland) Limited and Irish Intercontinental Bank at various times and in various amounts to the Irish Companies. These loans were secured inter alia by "back to back” deposits of funds by Tristan Securities Lfmfted with Ansbacher Cayman. The only documentation which I have Is the documentation provided by Guinness & Mahon and Irish Intercontinental Bank. I understand that the Inspectors have been furnished with copies of that documentation. (6) Exchange Control Acts, 1954 to 1992 • I understand that the Hinds required to establish the Tristan Settlement and the Prospect Settlement did not require any exchange control permission, as the Cayman Islands were'then in the Sterling area. As regards working capital loans by Guinness & Mahon Limited for the Irish property development companies with which I was associated and which were drawn down in Sterling, my recollection is that Guinness & Mahon Limited undertook to obtain, and did obtain, all necessary exchange control consents. (7) To the best of my knowledge and recollection, I had no connection or involvement wrth Ansbacher Cayman insofar as companies and trusts established in the Channel Islands were concerned. 100 % I Dublin Citv Estates Limited Irish Company Directors: John Byrne, Clara Byrne Shareholder: Carlisle Trust Limited Owns: D'Olier House ‘ Smlthfleid Prooertv Alstead Securities Develooment Limited Irish Company (formerly known as Directors: John Byrne and Clara Byrne . Endcamp Limited) Shareholder. Carlisle ' Irish Company Directors: John Byrne, ' Trust Limited Owns: Ashford Housa, Clara Byme Shareholder: Carlisle Tara Street; Parnell Trust Limited Housa; 18 Parnell Square; various minor Owns: Phoenix House, Smithfield sites Goraville Umlted Prtteo Limited JEC Prooerties now dormant • Companies Directors: John Byme and Clara Byme Shareholder: Carlisle Trust Limited UK COMPANIES STRUCTURE Date: 09.08.1971 Settior: John Furze Tn tan Se emen a Cayman discretionary trust Trustees: Ansbacher Cayman Limited (ACL): Bene?ciaries: British Red Cross/any contributors to Cayman Branch of Red Cross - 100% Directors: nominees of AOL Tri_stgn ?ecuriti? a Cayman Company Shareholders: nominees of ACL as trustees for Tristan Settlement 100% Danstar Holdings Pty -_-__Austrailan Co. Directors: Ronald W033 and Fat- U5 MeGsnn Shareholders: John Furze and John Collins as trustees for TSL lntramar Securities Cayman . Company Directors: nominees of ACL Shareholders: John Furze and John Collins as trustees for TSL Owns: Property In London 100% Tepbrook Properties Limited UK Company Directors: Ronald Woss. Pat McCann Shareholder: Danstar Holdings Pty Owns: Pmperty in London BANKERS ‘ GUlNNESSfMAHON LTD 17 CailagaGnsn Dublin 2 P.O.Sox SSA T«l: 716944 (17 Un«) 30th April, 1982. Gur Raf: FO* D/SC Tha Secretary, Carlisle Trust Limited, ' c/o, Management & Invastinent Services Ltd., 3, Trinity Street, * ' DUBLIN.2 . Dear Sir, ' . With reference to racent discussions,*we have pleasure in confirming that we are prepared to make available to you a facility, to be availed of by you 1n the form of a Loan Account, subject to-the following terras and conditions:• • Marimurt Amount: £900,000.00 (Nine Hundred Thousand Pounds) Starling. . Purposa: To repay a facility originally availed of in March, 1972. ‘ Term: All sums advanced are repayable on demand but in any case not later thin 30th April, 1985. 'Interest: We propose, charging Interest on the facility, at 3% over tha cost to us of.taking twelve months funds., The present effective rate is 17% and such rate shall be reviewed by us on.the 1st May annually. Interest will be debited to your account on the 31st July, 31st October, 31st January and 30th April, annually. We shall apply to you Immediately after the 30th April, for payment of annual Interest. . _ Security; As security for the loan we shall retain the mortgage dated 16th March, 1972 together with the Joint & ‘ Several Guarantee completed by Mr. 4 Mrs.J. J. Byrne. Assignment Clause: Whilst all or any part of the balance remains outstanding on the loan, we reserve the right to assign such balance or any part thereof as may be outstanding at any time to another bank in accordance with the terms now or at any future time applicable to the facility. / TiiMumi Wan.Quotm T f. GH Cayman Trust radegosited wi£h ourselves. ^ . As you know we have been unable to clear the outstanding documentation in this matter and# for ease o f reference, X an enclosing cony memoranda dated 15 July 1981 and 10 July 1979. The present loan balance is E9^2>9SS.57 DR. - Cl ^ i-J,0 v . n ^ " 3?rom: J.D, ’Traynor. . * • . * * •• Ha: ' V . I C A H U S L S TRUST LI3ITSD £900.000 STERLING LOAN. I wish to rafer to your last visit and to the notes you left with me. We spoke on the- telephone on Friday 2nd April when I advised that we proposed to give a new facility of £900,000 on Friday, 30th April, to Carlisle Trust to clear the existing facility. I asked would G.U. & Co. take 100% participation of this loan on the basis that G.M.C.T. made a funding Deposit and Q. + M. guaranteed the loan, the differential to G.M* & Co. to be You felt there should be no problem but said you would ask B . A . U . to ring me the following week on his return to the office. 1 tried to make contact a number of times on • Tuesday and.Wednesday the 6th and 7th April but he was at meetings and a note was taken to ring me back but I have heard nothing from him. iflaan speaking to R.D.F. in London on Wednesday last 1 * mentioned the matter and he indicated that of course the loan would ba dona. . We are now proceeding to have Central Bank approval obtained, facility letter approved and Resolutions etc. sorted out so that matters may be /flita.lised in good time. Arrangements have been made for £108,08-3.35 Sterling being interest to 30th April - to be credited to G.M. & Co. value 30th April, 1982. JD T / A J W . 7 -r^THY - !m ir BROUGHT FORWAHD 10/ 4/90 1/ 5/90 1/ 5/90 3/ 5/90 29/ A/90 23/ 4/90 15/ 5/90 Ir32.30 Anex Draft Anez Ir330 31.77 3500.00 . 322.57 o. . .0 219992.41 219669.34 I I I 223524.10 *AppendixXV. - 1 .. Print Key Output 5763SS1 V3R1M0 940909 Display Device User Account: . . . . . ............... 13154602 GBP Statement start Date t 54401354 0PS01S1 i SKELL5 Account Statement 9 /0 4 /9 7 ANSBACHER (CAYMAN) L CALL DEPOSIT 1 3 » 1 9 i0 1 0UAN87 Sel Value Narrative 19APR9Q EXCH ANSBACHER LIMITED CHEQUE LODGED Z0APR90 ANN VERDON KENNETH REGAN . CASH DRAWN EXCH ANSBACHER LIMITED EXCH ANSBACHER LIMITED CHEQUE LODGED STG DRAFT LODGED 23APR90 J GUINNESS 24APR90 EXCH ANSBACHER LIMITED JOHN BYRNE DRAFT IFO ST MARTINS SCH DRAFT IFO SOLIHULL SCHOOL _ Amount Balance 45.000.00DR 9«000.OOCR 1 6 ,0 2 2 ,0 2 0 .2 1 C R 20.000.00DR 1«,457.OODR 350.OODR 326.44DR •325.OODR 4.606-.88CR 10,009.OOCR • 1 6 ,0 1 7 ,1 6 8 ,6 5 C R 10.000.00DR 1 6 ,0 0 7 i 1 6 8 .65CR 48,875.OODR 3,500.OODR 1.137.60DR 1;083.80DR + Please reply to: 42 Htewflliam Square, Dublla 2 •' Tfel: 765144/763063 Fax: 612035 P.O.Box 887,Gnuid Capaaa,BritkhWdtbdn H u m (RD 90-4*33/4 WreCP<305 . . As(IOS)MM9M 23rd April, 1990 David Humphries, Esq., Senior Manager - Operations Guinness & Mahon Limited, 17 College Green, DUBLIN 2 . ' H. Bear David, 1 wonder would you be good enough please to organise a Sterling Draft payable to John Byrne in tha sum of Stg.23,500 and debit Ansbacher Limited Account No. 13'154602. • a • * I would like to have Andy pick this op in the morning (Tuesday) if at all possible and an therefore sending you fchia letter by fax. The original will follow by hand in the maiming. Yours sincerely, ' JD'P/AJW - x_ L J 11/ 3 / 9 0 2/ 9/ 9/ 17/ 4/90 4/90 4/90 4/90 2/ 4/90 9 / 4/90 9/ 4/90 17/ 4/90 BROUGHT FORWARD Lodged Drawn Drawn Lodged J JO/ 4/90 \ _________________ ;_______________CARRIED FORWARD • '-s’•■■■'• .•• ... ACCOUNT NUMBER 80019005 . PAGE BALANGE8-8HOWN ABE IN: sterling 109558.78 5000.00 6520.58 13 122579.78 232138.56 220617.98 2906.20 223524.18 L 10/4/90 1/ 5/90 1/ 5/90 15/ 5/90 J 25/ 4/90 23/ 4/90 15/ 5/90 BB0U0HT FORWARD Ir32.50 Anex Draft A m Ir330 HUM :11/ 5/90 CARRIED FORWARD ACCOUNT NUMBER apgi9005 BALANCES SHOWN Afttn& _7_ 31.77 3500.00 322«57 PAGE 223324.18 219992.41 10/ 6/90 1/ 7/90 1/ 7/90 1/ 7/90 1/ 7/90 8/ .7/90 14/ 7/90 W/ 7/90 / 7/90 * 30/ 6/90 30/ -6/90 30/ 6/90 30/ 6/90 18/ 7/90 30/ 6/90 2 V 7/90 BROUGHT FORWARD Differentials To J3 To J2 To J / Gtee Fee Lodged AHBX Ir317.02 PAGE 227583.62 8943.66 4708.19 160;96 4074.32 1530.00 294.04 209696.27 208146.27 2948.81 210801.04 _______ :____ y r \ L ►1/10/90 9/11/90 BROUGHTFORWARD 19/11/90 TO ULSTER BANK .. t {0/11/90 V C • /'v 1/ 3/91 CARRIED FOHWARD AGGOUNT WEB 90019005 BALANGEB SHOWN ARE IN: 105.34 7000.00 21443.76 . 3-6 PAGE 23 sterling 162705.60 162600.26 155600.26 134156.50 5315.90 . 1392172 . -.: :?kr - J L . 31/ 3/91 1/ 4/91 1/ 4/91 1/ 4/91 1/ 4/91 1/ 4/91‘ 1/ 4/91 1/ 4/91 15/ 4/91 JO/ 4/91 30/ 4/91 30/ 4/91 30/ 4/91 BROUGHT FORWARD 31/12/91 TO CORRECT VALUE DATE 31/12/90 TO CORRECT VALUE DATE 28/ 3/91 TO 33 ( 28/ 3/91 TO J 28/ 3/91 Z BO H J2 28/ 3/91 ■mm j 28/ 3/91 PRQH J3 13/ 4/91 ANEX 28/ 3/91 FROM J2 ' 28/ 3/91 FROM J2 28/ 3/91 REV ENTRY •28/ 3/91 REV ENTRY 30/ 4/91 CARRIED FORWARD . .W ....................... . .. 24 139472.40 2126.25 2126.25 3300000.00 2800000.00 112530.64 2838683.51 3150744.12 38.25 141430.67 141392.42 116822.22 3270904.01 112530.64 3150744.12 263843.89 ___________ / go, nul- up 0 1/ 7/91 1/ 7/91 1/ 7/91 7/91 '35] 7/91 '22] 7/91 ?mmw '1'08' FORWARD 31/ 7/ACCOUNT NUMBER 80019005 pa q e BALANCES SHOWN ARE IN: sterling 1250.00 15502.72 162.80 .34 .229190.62 J L 31/ 1/93 6/ 2/92 .4/ 2/92 v 6/ 2/92 i4/ 2/92 BROUGHT FORWARD CBEDIT SUISSE AHKX %V** «V* *,<«•*• •h V:".* % •»< .*' r i c c 29/ 2/92 v ___ CARRIED FORWARD I < \ , •-* t . < . v .• v . r . . , ACCOUNT NUMBER 80019005 PAGE BALANCES SHOWN ARE IN: Sterling 300.00 194.40 > 31 70640.74 70340.74 70146.34 J L J 19/ 2/93 m BROUGHT FORWARD. .9/ 3/93 16/* 3/92 AMEX *1/ 3/92 31/ 3/92 TO B/B D/A 11/ 3/92 31/ 3/92 FROM 1X73 *1/ 3/92 31/ 3/92 FHQH DJ 11/ 3/92 . 31/ 3/92 DIFFERENTIAL ./ *1/ 3/92 31/12/91 Int. Adjust, to 31/12 11/ 3/92 31/ 3/92 Interest to 31/ 3/92 31/ 3/92 'Accouur NUMBER 00019005 mes 'mucassuowuanew sterling 70146.34 504.44 69561.90 A 600000.00 . 402424.03 . 391451.37 26616.39 0.44 0 1737.30 . . - 100580.57 a gun 36.2.: 0 . z. 10/ 1/ 1/ (10/ 4/92 9/93 3/92 3/92 '6/ 4/92 9/ 4/92 14/ 3/92 BROUGHT FORWARD D KR 9336.68 AMEX AMHZ 31/ 3/92 CARRIED FORWARD J-6, mummy 30019005 mas sterling .3 . 1? .7 I 191073.72 .319.89 190269.79 16.03 VJ 190253.76 - a . . A I'L i/li/£ l/iO/92 1/10/92 4/10/92 J0/10/92 31/10/92 J . 30/ 9/92 1AO/92 30/ 9/92 14/10/92 16/10/92 T r a r Trom'A,'D FBQH J9 FBOH J6A FEE TO A LTD AMEX ACCOUNTNUM8ER 80019005 PAGE balances SHOWN ARE IN: sterling 38 h At Afau-' 176545.97 65000.00 4000.(X) 278.07 85000.00 2394.52 178940.49 174940.49 174662.42 - J -6 ACCOUpfTNUMBHR 8o019005 PASE -V 31/OB/94 31/09/94 31/09/94 26/09/94 10/09/94 . 01/09/9A 01/09/94 26/09/94 30/09/94 .BHOUQHT FORWARD IR211060 BAL1.YMADUN IWT CM ABOVE f . DIFFERENTIALS Interest to 30/09/B4 203841.75 3262.86 19894.18 535952.84 516058.66 . 4705.08 -/*. V*.C’T i . ® l V0 & S?&: W ;:: • ' ii-Rf? : x i« . » J0/09/94 VfeMMMMMna •• PARRIED FORWARD 520763.72 . • . : :•i•i5'v': iotekhal memo • To: Jroans ' ’ John Eaynolds M lB 5c. LD Snsbjacrt: Date: TEEB&COK SBOEBKEXBS LTD 27 March, 1992 4 • . ' . • I n et on* 27. March w ith Paul1' ’Cdatty.# ofDeloitte & Touche furtfcar to nry "previous meeting w ith Des Traynor ofjAasDaemer L td ., in -rela tio n to the proposed property acquisition by th« •abova company vftioh I vas advised- by Messrs,. Craynor and Carty is beneficially owned By 3ir. John Byrne of Carlisle. outl'inad the structure of the proposal whereby Tepbrook Properties Ltd. will purchase two sites in c^iaklewood, London for approx. GBP3a, including costs. J®1® sitfs roll of approx, GB3?150,000 and the intention is to redevelop them ovar tima. -. Equity of GBP2.25m will be invastad _in the transaction with dabt of .GHP2.»75ia being required. There is a furthar site which may ba acquired later in the Xaar wi^h * developing for Gateways supermarket. This way be toe sud3 «ct: • of a separata financing proposal. ' U»JJaVg-HM. JJ¥ *-r**nrffT CULwIiU WeiiwA* A ^ ,— — - the- two properties, the Deposit of the Title ' ® executed by t3aa borrowars solicitors, JjB$$2X& . wishes to have the facility lent by a ® **,_ consaquently, KB London will be required to imdertalc transaction with IIB .sub participating the risk, having racaivad the security. Carty is' to prepare a formal loan proposal and will revert during tha course of the next week with same. .. JOHSr^SYHOLDS i?I-l n Acc.Number: Date: 18 April 1994 Next Review Date: 30 June 1994 ’ -i 1,8 .«»/: Maurice Leonard BORROWER(S) DRAWERS .NAME .1. 2. . NAME PROFREL COUNTRY Clara Byme 3. NAME CITY STATE COUNTRY LEGAL STATUS ESTABUSHED ^■"^CLIENT 8INCE „■n o u p . H E R LENDERS BUSINESS U N E BORROWER CB CODE k E Y FIGURES N/A : : : : : V : .: : Clara Byme Ballymadun Stud, Ashbourne, Co. Meath. Ireland . Private Individual N/A New • N/A B O R R O W E R Data TNW TCW Total Assets ~~ . Sales Curr.Cash FI. • G U A R A N T O R Date TNW TCW Total Assets Sales Curr.Cash FI. N/A Stud Farm N/A - . ’ N/A ‘ 1.1 Exchange Rate: 1 1EP >44.43 BEF NR. n. y- Outstanding i •* #. •< • j * * Granted/ Approved IEP Requested 211 * . IN: Nature Request New THD ico LIMITS IN: Description of the Credit Lines and Limits Maturity Date 0 IEP211,060 Bilateral Bullet 30 June 1994 ADV-ST *«v T - - 211 G R O U P RISK: 211 Note: UB'sexposuretoCayman IntemationaiBank andTrustCompany UmitedC'CIBTC")/HamlltonRoss-related cash-backed facilitiesIsapproximatelyGBP21m. C {S o 6 1 r . .iNG and SUBPARTICIPATIONS N/A No r •••• »•- Documentation based on precedents approved by MB's solicitors. 1 . r r r ■ ?vica Account Officer: K e c o m m e n d a p p r o v a l . Recommended by: I ASM Loan f Officer Supported by: Deputy Head of Lending Z-cteaiz Department Decision of IIB Credit Committee ‘$ r — * • ' . i Director i 4. 1— /v ?u A p p No: Sent to Kredletbank for A / m j ntMMMtf Director on: ~ M t, ■ PH/AOC/7762 . April 25, 1994 . Ms. Cigra Byrne, . (trading as Ballymadun Stud), Ballymadun Stud, Ashbourne, Co. Meath. •v.^ear Ms. Byme, We are pleased to confirm the willingness of Irish Intercontinental Bank Limited ("IIB") to make the following facility available to you, Ms. Ciara Byme trading as Ballymadun Stud, ("the Borrower”) subject to the following terms and conditions. 1. AMOUNT AND NATURE OF FACILITY: Up to 1EP212.000 (two hundred and twelve thousand Irish pounds) by way of a Term Loan facility (the "facility"). The facility will be used by tne Borrower to fund her working capital requirements. 2. LATEST DRAWDOWN DATE; The facility is to be drawn down in full in one amount of IEP212,000 not later than 30 ..........April 1994 and not less than three business days notice of an intention to make the , drawing will be provided by the Borrower to uB. 3. INTEREST: The interest rate or rates on amounts outstanding under the facility will be set two business days before the date of the drawing of the fecility and for subsequent rollovers (if any) two business days before the first flay of each interest period. In each case the interest rate will be 0.35% above the rate at which IIB shall be offered funds of like amount on die Dublin Interbank Market for the relevant interest period. The Borrower may, by notice in writing to UB, not later than two business days before the date of first drawdown, or, as the case may be. before the expiry of an interest period, elect whether the next following interest period will be of one or three months duration, •. or such other duration as may be agreed from time to time by IIB and failing such election by the Borrower, the nextrollowing interest period will be of one month duration. . fy o o i IR IS H I W T t R C O h n i N C N T A L B A N K U M T T t D * 9 1 M C I U U O N S Q U A R X . O U f t U N 2 • T t L t P H O N C O I 4 1 9 7 4 4 • F A C S I M I U . 01 7 8 S O & 4 • T I L I X . 3 3 3 1 2 ________ ■ ■ ______________ »»*>«»»»»» im rut >»>UIHfrO»WHUWO NUMICR 401J7 IBB is entitled to require repayment of die facility on demand at any time. While’HB retains die right to require repayment of the fkcwty on demand at any time, it is agreed that, unless and until 1IB shall exercise such right, the facility will be repaid on 30 June 1994. SECURITY: Any and all indebtedness or liability of the Borrower to DB is to be secured by the following which shall be in a form satisfactory to HB and its advisers: . (a) the guarantee of Mr. John Byrne for all sums due from the Borrower to EDB; and (b) such other security in such form as shall be required by IZB[at its absolute discretion from time to time PROVIDED THAT if at any tune the Borrower is required by HB to provide such other security to HB, the Borrower shall have the right to prepay the facility immediately to IIB subject to Clause 5 of the Standard Terms and Conditions attached hereto. FEES: ' A negotiation fee of IEP1,000 is payable on acceptance of this letter of offer and is not refundable. The Borrower shall indemnify IIB against any loss or expense including but not limited to loss or expense on account ot funds oorrowea, contracted for or utilised to fund any amount payable hereunder which IIB may sustain or incur as a consequence of: a) b) ' the occurrence of any of die Events of Default set out at Clause 9 of HB's Standard Terms and Conditions which are attached hereto; or drawdown of die facility or any part thereof not being made on die due date after a drawdown notice has been receivedby HB from the Borrower. STANDARD TERMS AND CONDITIONS: The facility is subject to IIB's Standard Terms and Conditions which are attached hereto and which form part of tiiis Facility Letter. ACCEPTANCE OF OFFER: This offer will lapse on 27 April 1994. To accept this offer on the above terms and conditions please return the enclosed duplicate of this letter duly accepted and the attached direct debit mandate duly completed by the Borrower. Yours faithfully, for and on behalf of • , . IRISH INTERCONTINENTAL BANK UMflffiD jam Donlon, lianking Director. Brian Dunne, Senior Manager. ' Accepted on^ie above terms and conditions as Borrower \ c ------- r ------ Ciara Byrne. t . , * Accepted on the above terms andconditions as Guarantor \ £~) X L /lt^ ~ f - a - j- - - — - - - - - V i 1 " 1 - ...... ...... John Byrne. »yn^e. ' J Z Witness Y ' M X , ^ Address: -y j * I L f i x p & u j i Q L .. ) 3 ) i ■’c r Occupation:^ / 2 Q rt t ^ • Irish Intercontinental Bank Limited (IIB) ST A N D A R D T E R M S A N D CONDITIONS Attached «oFadftyLatterRal:-PN/ACC/77 duad 25 April 1994 * Ms. Ciara Byrne • • 62 (t/a Ballymadun Stud) I. CondMon* Pr*c*d*ne cunadmatedpenadlegdhortirtha*«*e«daaenied andpayaOM beforeHaapeofiadmaiuniyby» AuMtabltyelthetacJkya autoiactla doiedfcor dielaauehMaiaalpaymamdda: (* CcmplMnn ofauchlegdloimaUiMam InXIOIlorm ft) iflhaQmwiia*dil■ a«ublajB»a^ m IeaakoelaborrowMelaaidy.da fcaoi# dd tad d M* Ccmpaniaa Act ISO, a> «. welltttfmeatdrwunimpairedtoin partedd Mo •dlaaka ' aaubatanUpan d aa (dj BeaaiptbyMBd: ouhertioa. « m down auaH dtamdhn aurreney la an m-feMUfHb ieaaatodaappatda aaadaardwldadaaMlabackdabaidbemMa man by gadng ■aad leaMng Ha u m « lhaeMwy mud equivalentlaMiatadtay.Thalaanaandeanrtienaal idlnoiranolleaollho (Imamu cowiM clbwiMm if MeleaiBywB »PPV aadda mdaads l a d l dmwngaai a J e h A *>aaccountopawlnglear M dtieBowunar(MliaaaMe Bemwat ■aa aidwdul) (a) Therebang «a dawtopmad* barweaa «iadda daalamaliMaananerbaniNmalaItne. ahdicomnl any ad d hanfc/upicyor«y ocow * -v lacMy ladietedby *S andJhe datad da adairad madedeeMngMm baakKpfeor ■ ■ dKwkMm ortcntalhaopiniond ttmid ba»aVIs I.a*alaeukelaandioyunhangamovamada.feeamaad — ■ -ft,,t, lll d any and dl daOictlnm. mducdng (WMod MtaBaa) 10.Warrant**; ««Middkig laaw V d» Manawarlacempaladbylawor a. Covena/tt: Betm»otherebywaneMOIp MBMat leguMoatadeductanyauehamount«a anwadpayade a^ ar The 1*1 Mo edadngldaaadpadoanencad Ma lacdylane* bewnder id*be edamalledV kmaaaad aaMd Me ad baHoeanMeBawaawandIBam addnMe Baaauari amatidaAardMng loraudideducdaa«wddbaagudla ea^auli parneia aad lave baaa mBiaiiood by a« Me amount wNdi a«dd tmr— bean payaMe I aaaudi b) I«Ad m laauianeaoMoaaeeeptabletaM.taapd ipprapdde aaaala and la petliedar Ma prapady aataaaaiy aatpaiala^dlaaa-aad da a deductionbadadaen. yravUed aa aacudy M M. kwasd agakid al a a a o a i b l e budneea dda and . « ■ dad mddda dbar PaymMda«fllbamadebyauehmaaneaamaybadtpddad hauranca paWaa appdprtda la Ma Bdwaara. lb) Mara am a bym tarnMmalaHm« prncaadlngataloreanyCourtarTrfcuwdahlch»oula Marineaa.TheBawaaaradpwduoalaIBaademand X Lata Paymants: innudy anypdUaa d hauranaadua and mnawd be*»elylebavaanyadwtaaadeolaaa*iebualnau d aoiee.andW. Imquadad.NanaW» Warad adad VMlflnoMf(tMluhiipMpictoi Maalar aa any amount dial ba dua ty Me Bemwer o) M dladaaatahas Baa* made laIB d altad* « •nMehawenaepeltie* ptaMiaallalha«ae«yand anpaktauehamenddtdlbear a} lorMi*dumMsad Ma ladBy.Ma BanaMtda todoa wla»aa laMa BariowaratadBy. ar aandBia d Ma taatt^ latter arany agraemad ft dWn___dCdkadMaanddaaeh. ^ ringlalanaro»>»etlilalngiapaiiM adlewd afcalbalar mMtagMemM)araaiaba*byBid a* breachd any (kadngaidptd*andlaa*aaaauMa acaaual d Ma Baimaar and abatba pdd by •» tihaelelaaaMatleanIsMd aatoul leanaka*aallaattBda*panerdadlmtd aacklean ataaadllaaandaidbaadhedpn)udai laany*«ier Prepayments: laanataandkn. aybyIBInaaaidalnganyrigMpemer fawpid at pad d Ma laa% aiayba orprMagagrantedtoIunderMa lacSyMar *>i (d * wd ad «dhod Ma p n e r a pprovd hadOngdlB madeonlyupon aw I «Mng laMadlaaa Maa apatda aa a aadvd Marad notaha*any dngM or ' ~ idan aaaaad at patUd aa*iclaa d anyauehHprn.poweratpwrlega Mtea d la •mand paymentd m . ftidindtea»■B>WanaoaWaand precludelhaMuree>ardead anyauakHghtpant at «*»ofcUgasm lamar laawayBn arMaapeeHad p«1WaredonlhadaleapadUad.AnyaodiprapeymnKdl ( a ) lha rtgMs aad lamidei ptavldad tarhiMa lacMy * . Oat aulu: ablgaOtaBomwarlamdiapayanddlaM d MaaamaMae lattarataaumdattMandnd eadudvad anytighlaer d auobamourtaadialbadaaiMdbyIBM baaacaaseiy VWhsul ttdadea la Iff* m W ■ad^.iygala, nmadeapmMedbyhw la aonpaeaala IB larlha aad to IB d undMBig Me fcwdngurangamanlalorMa lacWyaad addllaaalWarad a m a m a f l B f t w a c a , Tima: d H d Me emaad «epiepaldjaaa «aa< mqulraImmadda rapaymad d **made* dua.ladudng laMe eaadiuallMd MaptavWanarddlnglaMa paymam aompinaalaaleillgelaeael>ieH)iAnyprapaymantalud Mated and dher ahargaa. dmild any d ttm Mbdng d madaa.fenaahalbad Meaeaanaad Maeadmd. be wbjed la al neaaaaary aachanga aealid and attar avarusoccurInralutonlalhaBorroweraraayOuaridoc (e) 11aha*datau*h Ma pa«ni*Md anytundN under regulaleryeaneeetaHawngbeenedawwd. AnlgmiMni: tfM(KlHy:of * fl. Raiarva AssaiCMtK (b I * *M ddau* n Ma performance d any lean. The laedlyh panand laMe Bona»er and du* nd he eoMnatild agreementcontainedlaIkelac«ylattarar capabled asvpvnanlbyMeBorrow*In«hd*otm pvt Tha8ono»a18Ml caauorihalMmalata SoniMMrwatMalanarfolItwlaeiHywd adbaavadatittto *h*n dalvetad. or I by Wax. or lalda*. Me nantionlocmm loOMyonilabuanaeaer Ita « tUlicwD amount In Mepad d thenad letowng Iranamaan • ecmpmad andlhaBonown'a anaw*iM«» (g) « any loan. dabl. guarantee or other otmgdan «M««iparntlhaBemwat SMIe*her.. •gnal•racewad conaiiiutingpart0(^1^dx*dwaa W* beeomadue <«l daqioowow t» Uelty onthela*dw d lieUw« To: Irish Intercontinental Bank Limited, 91, Merrion Square, Dublin 2 We hereby authorise and empower you pending payment of any Bills, Notes., Overdrafts, Loans, Guarantees, Bonds or other contingencies m respect of which we may be liable to you either directly, jointly with others, as collateral for facilities which you provide or may in the future provide to Ms. Ciara Byme (trading as Ballyma&in Stud), ana notwithstanding that such liability may be to hold all moneys which now or hereafter may stand to our credit in Deposit Account No.02/39375/77 or otherwise and in whatever currency as being available as security for all such liabilities as aforementioned. / Furthermore you are authorised to set off and apply such moneys or any part thereof from time to time in or towards satisfaction of such liabilities entirely at your own discretion without further notice and such setoff will be a good and valid discharge of such moneys so applied without any further endorsement or authorisation whatsoever. . Dated this^O day of April 1994 PRESENT when the common seal of HAMILTON ROSS CO. LIMITED was affixed hereto: Director 96006 To : Date : ^ Irish Intercontinental Bank Limited 91, Menion Square, Dublin 2. ■'April 1994 We Hamilton Ross Co. Limited of P.O. Box 887, Grand Cayman, British West Indies (hereinafter called "the Guarantor") in consideration of your from time to time making advances \o or coming undfer .liabilities or discounting bills for or otherwise giving credit or granting linking facilities to or granting time to or on account of Ms. Ciara- Byme (trading as • '.aUymadun Stud) (hereinafter referred to as "the Principal") do hereby guarantee to and agree '"/ith you as follows: 1. The Guarantor will pay you on demand and hereby guarantees the payment to you on demand of all sums of money which now are or shall hereafter become due to you from the Principal either alone or in conjunction with any other corporation or corporations person or persons and whether as Principal or Surety and whether upon account current or other banking account or accounts or otherwise or in respect of bills drafts notes or other negotiable instruments made drawn accepted advisea endorsed or paid by you or on your account for the .Principal either alone or in conjunction as aforesaid or whichjyou may from time to time beco liable to pay in respect of any bills drafts notes letters of credit circular notes or any other dealing or transaction on account of or for the benefit or accommodation of the Principal eith alone or in conjunction as aforesaid together with all interest costs commissions and other banking charges and expenses which you may in the course of your business as bankers ch against the Principal ana all costs charges ana expenses whichyou may incur in enforcing or obtaining payment of the sums of money due to you from the Principal either alone or in conjunction as aforesaid or attempting so to ;do.... This guarantee shall continue in force and be a continuing guarantee to the extent at any ne time of all monies due to you by the Principal (whether current or otherwise or subject to .. notice or not and in whatever currency) in addition to such further sum for interest and other Ib an k in g charges and costs and expenses as shall accrue due to you within sue months before or * at any tune after the date upon which payment shall be demanded by you from the Guarantor or any one or more of the persons constituting the Guarantor and shall (subject to the aforesaid maximum limit of the liability of the Guarantor) be applicable to the whole ultimate balance that may become due to you from the Principal either alone or in conjunction as aforesaid and not merely to a portion co-extensive with the amount of the said limit. . BB M M a M H a ^ t 3. ' It shall be lawful for you at any time after notice to determine this guarantee has been given or after payment of the moneys guaranteed has been demanded of tne Guarantor to continue any existing or to open any new account or accounts with the Principal and no money thereafter paid into such account or accounts shall be appropriated in discharge of any moneys hereby guaranteed unless expressly directed by the person paying the same at the time of such payment to be so appropriated. , 4. Where the Guarantor is afirm or otherwise consists of more than one person the liability of the Guarantor hereunder shall be deemed to be the joint and several liability of the parties in he firm or of such persons as aforesaid. The bankruptcy or insolvency of the Principal shall not affect or determine the liability of the Guarantor under tnis guarantee but such liability shall continue in full force and effect until you shall have been repaid all moneys due to ygu from the Principal immediately before the 6. All dividends compositions and moneys received by you from the Principal or from any other company person or estate capable of being applied by you in reduction o f the indebtedness of the Principal shall be regarded ror all purposes as payments in gross and you shall be entitled to prove in tne bankruptcy of the Principal should he become bankrupt m respect of the whole of his indebtedness to you and without any right on the part of th.e Guarantor to be subrogated to you in respect of any such proof until you shall have received in the bankruptcy of the Principal or from other sources lOOp in the £. 7. No assurance security or payment which may be avoided under any enactment relating to bankruptcy or under Sections 286 and 288 of the Companies Act 1963 or any statutory modification thereof and no release settlement or discharge which may have been given or made /--Non the faith of any such assurance security or payment snail prejudice or affect your right to recover from the Guarantor to the full extent of mis guarantee. (' >;'\ # _ ; This guarantee and your rights under it will not be affected or prejudiced by your holding . .taking any other or furthersecurities or by your varying releasing or omitting or neglecting to enforce any such securities or by your varying or determining any credit to the Principal or by your renewing bills of exchange promissory notes or other negotiable instruments or giving tune tor payment or granting any other indulgence to or making any other arrangements with or accepting, any composition from the Principal or any person or persons corporation or corporations liable on any bills of exchange promissory notes or other negotiable instruments or securities held or to be held by you. . 9. You shall be at liberty but not bound to resort for your own benefit to any other means of payment at any tune and in any order you think fit without thereby diminishing the liability of the Guarantor and you may put this guarantee in force either for the payment of die ultimate balance after resorting to other means of payment or for die balance due at any time notwithstanding that other means of payment have not been resorted to and in the latter case without entitling the Guarantor to any benefit from such other means of payment so long as any moneys remain due from the Principal to you. ^ 10. You may at any time (both before and after any demand hereunder and withoutprior “ice) set off and apply the monies or any part thereof in Account No. 02/39375/77 of the arantor with you (whether currant or otherwise or subject to notice or not and in whatever xrencv) in or towards satisfaction o f any liability of the Guarantor to you (and notwithstanding that sucn liability may be contingent) entirely at your own discretion without further notice and such set-off wilTbe a good and valid discharge of such monies so applied without any further endorsement or authorisation whatsoever. 11. In the event of the Principal becoming bankrupt or making any arrangement or composition with creditors die Guarantor will not prove in competition with you in any such bankruptcy in respect of the debt due from the Principal to you but will give you the benefit of any proof which the Guarantor may be entitled to make in respect of any part of such debt paid by the Guarantor until you shall have received the full amount of the debt due to you from the Principal. 12. Any accounts settled or stated by or between you and the Principal or on his behalf may be adduced by you and shall be accepted by the Guarantor as conclusive evidence of the amount thereby appearing to b.e due from the Principal to you and any payment to you by or on behalf of the Principal on account of his liability whether for advances or interest or charges or any • acknowledgement by acquiescence on account or otherwise by or on behalf of tne Principal of '.h liability shall operate as an acknowledgement of the liability of the Guarantor according to : terms thereof. . 13. Nothing done or omitted by you in pursuance of any authority or permission contained in this Kuarantee shall affect or discharge the liability Af&e Guarantor under it._______________ n 14. This guarantee shall remain in full force and you shall be entitled to recover against the Guarantor to the full extent herein mentioned notwithstanding that the debt of the Pnncipal may have been ultra vires the Principal or that the borrowing powers of the Principal may have been exceeded or that by reason of any- incapacity or any detect or informality the amount advanced to or the liability of the Principal cannot be recovered from orenforced against the Principal. 15. The benefit of this guarantee and all rights conferred upon you hereby may be assigned to and enforced by any assignee and proceeded on in the same manner to all intents and purposes as if such assignee had been named herein instead of you. 16. Any notice or demand required to be given or made under this guarantee may be given or made by leaving the same or sending it through .the post in a prepaid envelope addressecfin the . '/sc or a notice to be given to you to 91 Memon Square m the City of Dublin and in all other '....ses to the Company or person to or upon whom tne notice or demand.is to be given or made at jieir registered or pnncipal office or last known place of abode and a notice or demand so given or made shall be deemed to be given or made on the day it was so left or the day following that on which it is posted as the case may be. 17. As a separate and independent stipulation the Guarantor agrees that any sum or sums of money intended to be the subject of this guarantee which may not be legally recoverable from the Pnncipal whether by reason of any legal limitation, disability, infancy or incapacity of the Principal or any other fact or circumstance and whether known to you or not shall nevertheless be recoverable from the Guarantor as sole or principal debtor in respect thereof and shall be repaid to you by the Guarantor on demand. 18. If for the purposes of obtainingjudgement in any Court it is necessary to convert a sum due hereunder in one currency (in this clause called the "first currency") into another cim^ncy (in this clause called the "second currency") the rate of exchange which shall be applied shall be that at which in accordance with normal banking procedures, you could purchase the first currency with the second currency on the business day preceding that on which final judgement .. is given and the Guarantor's obligation in respect of any such sums due from it to you hereunder hall notwithstanding anyjudgement in tile second currency, be discharged only to the extent , .iat on die business day following receipt by you of any sumjudged tp be due hereimder in the second currency you may in accordance with normal banking procedures purchase the first currency with tne second currency. If the first currency so purchased falls short of the sum originally due to you in the first currency the Guarantor agrees that it shall as a separate obligation and notwithstanding any suchjudgement indemnify you against such shortfall. 19. Notwithstanding any other provision hereof, all amounts payable or expressed to be payable to or for your account by file Guarantor under or in respect of its obligations hereunder shall be payable by the Guarantor only from and to the extent of the sums on deposit in Deposit Account No. 02/39375/77 (the "Deposit Account") of the Guarantor with you and shall be recoverable by you only from and to the extent of the amount so deposited by the Guarantor with you PROVIDED the amount so deposited by the Guarantor with you in the Deposit Account shall at no time be less than a principal amount of GBP225.000 (tw o Iwndred and _ _ twenty five thousand pounds Sterling) together with interest accrued thereon AND FUK l tiiLK PROVIDED THAT the Guarantor shall not withdraw any sum so deposited in the Deposit Account with you without your prior written consent. 20. This guarantee shall be governed by the laws of Ireland. n IN WITNESS whereof this Guarantee has been executed the date and year first herein written PRESENT when the Common Seal of Hamilton Ross.Co. Limited was affixed hereto: . i . -T ' This Guarantee dated this v' ..................... . . . Ar,v „r . •• <•«/ One thousand nine hundred and................^ 1 . s & . r w ...3 7 . ..$ .......................... 2 ....... ••',a,,‘cj 0r....... £ }&4.......,C.:/..(V&A............................................................................. .................... .^ am e) 2 of...... ’ 3 I ................... - ..................... - ...............(Name) of,................................... .....................................................................................................................(Address} (hereinafter called ‘"the Guarantor*" which expression shall include their executors administrators successors or assigns) and Guinness Sc. Mahon Ltd. (hereinafter called ‘'the Bank" which expression sliaJI include its successors or assigns). Whereas the Guarantors have requested and the Bank has agreed to grant and.or continue accom­ modation to ’ . (NameI JhiQ zfcts. of.......k ...... .. M i ... & * « '.................................... J L L ............................. 4Addras) (hereinafter called “the Customer") upon the Guarantors executing u Guarantee in favour o f :he Bank on the terms and conditions hereinafter appearing. Now therefore it is hereby agreed and declared as follous: . 1. In consideration o f the Bank making or continuing advances or otherwise giving credit or affording banking facilities to the Customer, for as long as the Bank may think fit, the Guarantors agree to pay to the Bank on demand all sums o f money (hereinafter called the “ultimate balance") which are now or shall at any time be cuing or remain unpaid to the Bank from or by the Customer whether as . principal or surety and whether solely or jointly with any other party or from any firm in which the . Customer may be a partner, upon current over-draft accounts, promissory notes or bills discounted or paid and oilier loans, credits or advances made to or for the accommodation or at the request o f the Customer solely or jointly or of any such firm as aforesaid whether for actual or contingent liability or on any other account » hat>ocvcr together with in all the cases aforesaid, all interest, discount und other bankers' charges including legal charges occasioned by or incident to this or any other security held by or offered to the Bank for the ultimate balance or by or to the enforcement o f any such security PROVIDED ALW'A\S that the total liability ultimately^ enforceable against the Guarantors under this guarantee shall not exceed the sum of £ o 2 V > d < i O ------- * > the guarantors. D. This guarantee shall re ::: adoit.vn in ;iml shall not be in any way prejudiced or uJlec:cd b> any Ii. Although tiic ultimate liability o f llic Guarantors under this guarantee is not to cxoccd the limil hereinbefore specified, yet this guarantee shall be construed and take cffcct as a guarantee for the whole and every part of the ultimate balance owing by the Customer to the Bank, and unless and until such balance has been paid in full by the Guarantor the Guarantor! shall not be entitled to share in any security held by the Bank on accouut o f that balance or to stand in the place o f the Bank in ' rcspect of atiy security or money nor until such balance ius been paid in full shall ihc Guarantors take any steps to enforce any right or claim against the Customer in rcspcct o f any monies paid by the Guarantors to the Bank hereunder or have or exercise any rights as surety in competition with the Bank. __ • ‘ ' \ F. For the purpose o f enabling the Bunk to sue the Customer or prove yguinst his estate for the whole o f the-ultimate balance or to preserve intact the liability o f any other party, the Bank may at any time place and keep for such time as it may think prudent any money received. recovered or realised hereunder on one or more separate or suspense accounts to the credit either o f the Guarantorsor o f such other party as it shall think fit without any intermediate obligation on the part o f the Bank to apply the same or any part thereof in or towards the discharge o f the ultimate balance owing as aforesaid and without any intermediate right on the part of the Guarantors to sue the Customer or prove in the bankruptcy, jnsolvency or winding-up -of the Customer in competition with the Bank or so us to diminishany dividend cr other advantage that would or might come to the Bank or so us to treat the liability o f the Customer as diminished. - ' G. All monies received b\ the Bank from the Guarantors or the Customer or any other party liable to pay the same may be applied by :he Bank to any account or item o f account or to any transaction to which the same may be applicable. ■ ' H. This guarantee shall not be considered us satisfied by any intcrjnediate payment or satisfaction o f the whole or any pan o f a:iy sunt or sums o f money owing as aforesaid but shall be a cominuiny security and shall extend to cover any sum or sums o f money which shall for the time being constitute the balance due from or unpaid by the Customer to the Bank upon any such account or accounts as aforesaid and so that where such balance exceeds the aforesaid limit o f the liability o f the Guarantors, the Bank may sclcct the particular account or accounts which is or arc to be regarded as secured by this guarantee. . ' _ ' I. This guarantee shall be binding as a 'continuing security on the Guarantors, and in the event of death of.any o f the Guarantors. 01 his executors or administrators and on his estate. un:il the expiration o f one calendar month a:ler all the Guarantors, including in the case o f death, all the executors or administrators e:‘ the estate o f the deeeused Guarantor slutll have giveri to the Bank notice in writing to discontinue and determine it. and shall, in addition, extend to cover any chequcs, orders for payment, drafts. bi!l>. notes and negotiable instruments drawn, made, endorsed or accepted by or for the amount o f the Customer on the Bank and purporting to be dated before the expiration o f such notice although not puiti or honoured by the Bank until after such expiration. . J. The Bank shall be at liben* without any further consent from the Guarantors and without in any way allecting its rights again*; the Guarantors, at any time to renew, determine, enlarge or vaiy any credit to the Customer, to renew, vary, exchange, abstain from perfecting or release any other securities held or to be held by the Bank for or on account of the monies intended to be hereby secured cr any part thereof, to renew bills ar.J pronii'Sory notes in any manner and to compound with, give tiirro for payment to. accept compoai:.v.is rroiri and make any other arrangements with the Customer or any other party in respect o f the liubilitio hereby secured and the Bank may release or discharge any o f the Guarantors from the obiJcauon- o f this guarantee or make any composition or arrangement with any one or more o f :ho.r. * it hot: allceting its rights aguiiht the other or others of tiier.i. . K. In the event o f this gu;::srtec ce.sing from any cause whatsoever lo be binding as a continuing security on the Guarantors or any of them, the Bank shall be ut libertv without thereby allceting its rights hereunder to open a :Vo!i account or accounts or to continue any then existing account or accounts with the Customer j::- ho irjncy paid from time to lime into any such account or .icceunts by or on behalf o f the Customer j i u : subsequently drawn out by the Customer shall on sc.ileruciu o f any claim in respect oft!:.? iiu: rar.ee be appropriated towards or have ihc dlcct o f puv.ne.’t o f .my rvirf nt* ilii» miimVv tli-» ,\r i •irvn'i) Itv ih.» C iNiuin.'i- nr .w* iM.» mhcivnI thereon at the rime . Ilie Customer trt the amount, t»l’ Hw Adchiedness of the Customer to the Bank and any judgment .recovered by the Bunk against the Customer in roped oPvuch indebtedness shall be binding and conclusive on and against the Cuaninton>. M. The Guarantors hereby warrant ami undertake to tlio U.i*'k tliat in respeel ol their liability under this guarantee they have not taken and will net lake from the Customer, cither directly or indirectly, without the consent of the Bank, any promissory notes, bills ol exchange, mortgage, chargc or other security whether mprely personal or involving a charge on any property whatsoever of the Customer whereby the Guarantors or any person claiming through them by endorsement, assignment, or otherwise would or might on the bankruptcy, insolvency or winding-up or the Customer and to Ihe prejudice of the Bank increase the proofs in such bankruptcy, insolvency or winding-up or diminish the property distributable among the creditors o f the Company: and that as regards any such security as aforesaid which the Guarantors.may have taketj or may take with such consent as aforesaid the security shall be a security to the Bank for the fulfilment of the obligations o f the Guarantors hereunder and shall forthwith be deposited by the Guarantors wjth the Bank for that purpose. ' • ' N. In ivspcct uf'the Guarantors' liability hereunder the Bank shall have a lien on all securities or other property of the Guarantors held by the Bunk whether for safe custody or otherwise. The Bank shall further be entitled (as well before as uAer demand hereunder} to set-off against any credit balance in uny account of the Guarantors with the Bunk (whether current or otherwise or subject to notice or not) the liability o f the Guarantors to the Bank hereunder. O. No assurance, security or pavmerit which may be avoided under urn enactments relating to bankruptcy or under the provisions o f any other law-governing the Customer and no release settlement, or discharge which may have been given or made on the faith of any such assurance, security or payment shall prejudice or alfect the Bank's right to recover from the Guarantors to the full extent o f this guarantee as if such a&arance. >ccuriiy. payment, release settlement or discharge (as the case may be) hud never been granted, gives-or made. • . ’ . • 1*. The non-c.\ccuiion or invalid c.\ecu:ion o f this guarantee by any one or more of those who have agreed to join in this guarantee will not all'cct the liability.of those who have joined in und signed this guarantee. . Q. 'I his guarantee shall not be discharged nor shall the Guarantors' liability be affected by reason o f any failure or irregularity dc:ce: or informality in any security given by or on behalf of the Customer in respect or the monies or liabilities hereby secured nor by any legal limita'tion. disability, incapacity or want of any borrowing powers of or by the Customer or want of authority of any director, manager, ollicial or other person appearing to. be acting for the Customer in any matter in rcipect o f ihe monies- , " or liabilities hereby secured or any other circumstances which renders the liability o f the Customer void or unenforceable and such monies or liabilities will be recoverable by the Bank from the Guarantors us principal debtors and th:s guarantee shall be deemed to be an indemnity. ■ R. Should the Customer be an unincjrporate body, committee, partnership., trustees or debtors on a joint account, this guarantee >hall remain cfTcctivc notwithstanding any death, retirement, change, uecession or uddition us fully as if the person or’-pcrsons constituting such body, committee, partner­ ship. trustees or debtors on join: account at the date of t(ic Customer's default or at uny time previously was or were the same as at the date hereof. S. Ain notice of demand hereunder by the Bank shall be deemed to have been sulliciemly given if sent bv prepaid post to the addresses o’*the Guarantors last known to the Bank or stated hereunder and shall be deemed to have readied the addressee in the course of post. In the case of death o f any o f the Guarantors, any notice of JcituikJ by the Bank shall be suHieicmlv given if sent b> prepaid p o t addressed to the deceased or his personal representative at his address last known to the Bunk or stated hereunder unless and *j;::il ;he Bank shall have received notice in writing of the name ai:J address of the person to whor.i :epre>e.itation has been granted. ’I. I his guarantee is and will re.iuin :!ie propcrtv of the Bank. Signed a t ............................... .....................:.............. ............................... ' n Guarantee dated ....... i C , % ..................... k ... ................... Amount. . . J g c c , C C o -------x . ........... Witness present (adding address and occupation) ' AdJrebi and Occupation of Guarantors Sisjnatu.v of Guarantors • • , <% 3) ***S ( A ^a*-- H. C^> . i ‘ 7 (& .“7 T / VoL-— . • t'&KCL / I a. fa »vV ^ / filc ru M •; WU certify l!ul WE have thia du> rvruu the :.bv>\c Guarantee ai'J Ii.iw received a cops there- •!'. Uuaraiilor ( Q uarantee n By Individual(s), Partnership or Company(ies) T o Guinness Er Mahon limtted (hereinafter called "the Bank" which expression shall Include and extend to their successors and assigns) • • . When the Customer isin partnership enter names ofParters or trade .name (ifany) IN CONSIDERATION of the Bank from time to time making or continuing advances to or coming under liabilities or discounting bills for or otherwise giving credit or affording banking accommodation facilities or granting time to or on account of '................................... .............. L . . A f $ . ! . T £ 8 ................................. ....................................... ................................(hereinafter called "the Where the Guarantorisin partnership enter trade name Customer")......,................................. . . . £ .....................£ ............................................................ . ■ . .■/ . ' ........................................................ .............. (hereinafter called "the Guarantor") HEREBY UNCONDITIONALLY GUARANTEES AND AGREES to pay to the Bank on demand all sums of money which are now or shall hereafter become due to the Bank by the Customer (either alone or in conjunction with any other person and whether as principal or surety) upon current account or other banking account or upon foot of bills, notes, drafts, negotiable instruments, letters of credh, circular notes, guarantees, bonds, Indemnities or other transactions drawn, made, accepted, advised, endorsed, done, paid, discounted or given by the Bank for or for the benefit or accommodation or at the request of the Customer (either alone or in conjunction as aforesaid) and all sums of money which the Bank may from time to time become liable to pay on foot of any such bills, notes, drafts, negotiable instruments, letters of credit, circular notes, guarantees, bonds, indemnities or other transactions as aforesaid, or otherwise howsoever, together with: (a) all interest, discount, commission and other banking charges and expenses chargeable up to date of such demand against the Customer by the Bank in the course of its business as bankers; (b) further interest on the moneys secured by this Guarantee from the date of demand thereof until payment at the rate as agreed between the Customer and the Bank and applicable at the date of such demand and in the absence of such agreement at three per cent in excess of the Bank's Base Lending Rate for the time being; ' O r- (c) • Delate If guarantee is.to s unlimited all costs, charges and expenses, including legal expenses recoverable from the Customer and all costs, charges and expenses, including legal expenses, (on a full indemnity basis) arising out of or in connection wjth the recovery by the Bank of the moneys due to the Bank under this Guarantee which the Guarantor hereby agrees to pay. PROVIDED nevertheless that the total amount recoverable from the ............. Guarantor hereunder shall not exceed (say“^ . . together with a further sum for such interest and other costs, charges and expenses as aforesaid as shall accrue due to the Bank at any time before or at any time after the date of such demand as aforesaid. This Guarantee shall be construed and take effect as a Guarantee of the whole of the said moneys and liabilities and until they shall have been paid discharged and satisfied (and they shall be deemed to be due and owing notwithstanding the bankruptcy insolvency or liquidation of the Customer) the Guarantor agrees that the Guarantor shall not take steps to enforce any right or claim against the Customer in respect of any moneys paid by the Guarantor to the Bank hereunder and shall have no right of proof in such bankruptcy insolvency or liquidation in competition with the Bank notwithstanding any payment of the whole or part of the sum for which the Guarantor may be liable nor any other right of a surety discharging his liability AN D if this security shall from any cause whatsoever cease to be binding upon the Guarantor or the Guarantor's legal personal representatives as here­ inafter provided the Bank may without prejudice to its rights hereunder open a fresh account or accounts and continue any existing account in the name of the Customer and may.appropriate to any such fresh account any moneys thereafter paid in received or realised for the credit of the Customer without being under any obligation to apply the said moneys.or any part of them in discharge of any indebtedness or liability of the Customer to the Bank and if the Bank shall fail to open such a fresh account it shall be deemed to have done so with the effect that the said moneys shall not operate to reduce the said indebtedness or liability at the time this Guarantee so ceases to be binding as a continuing security. 3. This Guarantee shall be binding upon the Guarantor and the executors administrators or other legal personal representatives of the Guarantor as a continuing security until the expiration of three calendar months from the time of receipt by the Bank of notice given in writing by the Guarantor or the Guarantor's said representatives or any of them to determine the same and shall not be considered as satisfied by any intermediate payment of the whole or any part of the moneys due or owing to the Bank by the Customer but shall extend to cover all such moneys as shall be due or owing or accruing due or owing at the time at which such determination shall take effect and shall further extend t n rm/pr an v cheques, orders for payment, drafts, bills, notes or other negotiable instruments drawn made endorsed or accepted by or for the account of the Customer on the Bank and purporting to be dated before the expiration of such notice although not paid or honoured by the Bank until after such expiration*. Notwithstanding the foregoing provisions regarding termination of this Guarantee by the Guarantor giving to the Bank three months written notice, in the case of an advance to the Customer being repayable at a fixed date no such notice shall take effect until the day next succeeding the date upon which all the moneys and liabilities hereby secured should have been fully paid discharged and satisfied by the Customer in accordance with the terrns of this Agreement with the Bank. . 4 • No assurance security or payment which may be avoided under any enactment relating to bankruptcy or under the provisions of any other statute affecting the Customer or his affairs and no release settlement or discharge given or made by the Bank on the faith of any such assurance security or payment shall prejudice or affect its rights to recover from the Guarantor to the full extent of this Guarantee including any moneys which the Bank may be compelled by due process of law to refund to the Customer in liquidation or a liquidator pursuant to any such enactment or statute and any costs payable by the Bank pursuant to or otherwise incurred in connection with such process. In the event of the death bankruptcy or liquidation of the Customer the Guarantor's liability hereunder shall extent to dll sums which would at any time have been owing to the Bank by the Customer if such death had occurred or such bankruptcy, or liquidation had commenced respectively at the time.when the Bank receives actual notice thereof and notwithstanding such death bankruptcy or liquidation! This Guarantee shall be in addition to and not be prejudiced by any other Guarantee or security how or hereafter held by the Bank for all or any part of the moneys and liabilities hereby secured nor shall any other such security or the liability of any person not a party hereto be in any way prejudiced by this present security AND so long as any moneys are due or owing hereunder the Bank shall have an immediate right of set off in respect of all moneys standing to the credit of the Guarantor with the Bank on any account whatever and a lien over any securities or other property of the Guarantor held by the Bank whether for safe custody or otherwise. To the extent that any payment made by the Guarantor hereunder may be subject to withholdings, taxes, duties, levies, imposts or charges imposed in respect of such payment by any authority of the Republic of Ireland or other country, state or other political division by means of deduction at source or otherwise, the Guarantor will in such event pay to the Bank such additional amount as may be necessary to ensure that the Bank receives the full amount due to it in accordance with the foregoing provisions of this Guarantee. ‘ For all purposes including any legal proceedings a copy of the account of the Customer in the Bank's books signed by any of the Bank's officers shall be accepted by the Guarantor as conclusive evidence of the state of '’ ’>* • such account. The Guarantor has not taken and will not take from the Customer any security whether personal or forming a charge on property of the Customer for the moneys and liabilities hereby secured such as might on the bankruptcy insolvency or liquidation of the Customer result in any diminution in or prejudice to the security herein and the Guarantor UNDERTAKES that any such security now or hereafter held by the Guarantor shall be held in trust for the Bank and for its benefit in respect of the obligations of the Guarantor hereunder. W ITH O U T PREJUDICE to this security the Bank may without the knowledge or consent of the Guarantor determine reduce or increase any credit or facility or compound with grant time or other indulgence ■to or renew any bills of exchange or notes for the Customer or to or for any other person whatsoever or deal with exchange release modify or abstain from perfecting or enforcing any security or other Guarantee or right which the Bank now has or may hereafter have against the Customer or any such other person. Without prejudice to the generality of the foregoing, the Bank shall be at liberty but not bound to resort for hs own benefit to any other means of payment at any time and in any order the Bank may think fit without thereby diminishing the liability of the Guarantor and the Bank may enforce this Guarantee either for the payment of the ultimate balance after resorting to other means of payment or for the balance due at any time notwithstanding, that other means of payment have not been resorted to andTn the latter case without entitling the Guarantor to any benefit from such cither means of payment so long as any moneys remain due from the Customer to the Bank. . The Bank may at its absolute discretion without the consent of the Guarantor and without notice to the Guarantor ASSIGN the debt and liabilities hereby secured and the rights and benefits embodied in this Guarantee together with any securities of the Guarantor held by the Bank in support thereof or otherwise to any person or persons firm committee association or other unincorporated body or to any limited company or corporation whatsoever and the Guarantor agrees that the Guarantor and the executors administrators or other legal personal representatives of the Guarantor shall be bound to any such assignee in like manner and to the like extent as the Guarantor is bound to the Bank hereunder. This Guarantee shall continue to bind the Guarantor notwithstanding any amalgamation or merger that may be effected by the Bank with any other bank, company or companies, person or persons or notwithstanding any reconstruction by the Bank involving the formation • of and transfer of all or any of Its assets to a new company or notwithstanding the sale of all or any part of its undertaking and assets to another company whether the company or companies with which the Bank amalgamates or the company to which it transfers all or any of its assets either on a reconstruction or sale as aforesaid shall or shall not differ in their or its objects, character and constitution from the Bank it being the intent of the Guarantor that this Guarantee shall remain valid and effectual in all respects in favour of, against and with reference to and that the benefit of this Guarantee and all rights conferred upon the Bank hereby may be assigned to and enforced by any such company or companies, person or persons and proceeded on in the same manner to all intents and- purposes as if such company or companies, person or persons had been named herein instead of the Bank. 12. The Bank is to be at liberty without prejudice to any other rights it might have at any time and from tim e to time to place and keep for such time as the Bank may think prudent any moneys received recovered or realised under or by virtue of this Guarantee to or in a separate or suspense account as the Bank shall think fit without any intermediate obligation on the Bank's part to apply the same or any part thereof in or towards the discharge of the moneys due or owing to the Bank by the Customer. ^ 13. Any notice or demand required to be given or made under this Guarantee may be given or made by leaving the same or sending it through the post in a prepaid envelope addressed in the case of a notice to be given to the Bank at its registered office and in all other cases to the Company pr person to.or .upon whom the notice or demand is to be given or made at their registered or principal office or last known" place of abode and a notice or demand .so given or made shall be deemed to be given or made on the day it was so left or the day following that on which it is posted as the case may be. ’ 14. If the name of the Customer hereinbefore inserted is that of either a firm or of a limited company or other corporation or of any committee or association or other unincorporated body any of the provisions hereinbefore contained which are primarily and literally applicable to the case of a single and individual Customer only shall be construed and take effect so as to give the Bank hereunder a guarantee for the money owing from that firm and every member thereof jointly and severally and from that limited company or corporation or committee or association or other unincorporated body as identical or analogous as may be with or to that which would have been given for the money owing from a single individual if the Customer had been a single individual. In the case of a firm this Guarantee shall be deemed to be a continuing guarantee of all money owing on any such account as hereinbefore mentioned from the persons or person carrying on business in the name of or in succession to the firm or from any one or more of such persons ajthough by death, retirement or admission of partners or other causes the constitution of the firm may have been in part or wholly varied. In the case of a limited company or other corporation any reference to bankruptcy shall, be deemed to be a reference to . liquidation or other analogous proceedings and the money owing as aforesaid and hereby guaranteed shall be deemed to include any money owing in repsect of the debentures or debenture stock of the limited company or other corporation held by the Bank or on its behalf. This Guarantee shall not be discharged nor shall the Guarantor's liability be affected by reason of any failure or irregularity, defect or informality in any security given by or ori behalf of the Customer in respect of the moneys or liabilities hereby secured nor by any legal limitation, disability, incapacity or want of any borrowing powers of or by the Customer or want of authority of any Director, Manager, or official or other person appearing to be acting for the Customer in any matter in respect of the moneys or liabilities hereby secured or any other circumstances which renders the liability of the Customer void or unenforceable and in any such event such moneys or liabilities shall be recoverable by the Bank from the Guarantor as principal debtor and this Guarantee Shall be deemed to be an indemnity. . . Should the Customer be an unincorporated body, committee, partnership, trustees or debtors bn a joint account, this Guarantee shall remain effective notwithstanding any death, retirement, change, accession or addition as fully as if the person or persons constituting such body, committee, partnership, trustees or debtors oh joint account ■ at the date of the Customer's default or'at any time previously was or were the same as at the date thereof. The Guarantor hereby represents and warrants to the Bank that— (a) the execution and.delivery of this Guarantee will not contravene any provisions of law now in effect nor of the Memorandum or Articles of Association (or Bye-Laws or other relevant corporate documents) of the Guarantor nor any agreement indenture note or other instrument which is binding upon the Guarantor; (b) the Guarantor has full power to execute and deliver this Guarantee and to perform its obligations hereunder and that such actions have been duly authorised by all necessary corporate action: and 1c) the Guarantor has obtained all such consents or approvals or exemptions by any governmental or public body or authority which are required to authorise or are required in connection with the execution delivery or performance of this Guarantee or thetakino of any action hereby contemplated. t Should the Guarantor be a firm or consist of more than one person, the Bank shall be at liberty to release any one or mors of the partners in the firm or of such persons from the obligations of this Guarantee or to accept any composition from or'make any other arrangements with any one or more of them without prejudicing or affecting the Bank's rights and remedies against the other or others of them. The non-execution or invalid execution of this Guarantee by any one or more of those who have agreed to join in this Guarantee shall not affect the liability of those who have joined in and signed this Guarantee. So far as may be necessary to give effect to the provisions of this Guarantee, the Guarantor waives in favour of the Bank all rights which but for this waiver the Guarantor might exercise or enforce against the Bank or the Customer. The Guarantor agrees that in the event of the Bank taking proceedings hereunder the Bank may in its absolute discretion bring them in the Courts of the Republic of Ireland or any other country which it may deem suitable and for the purposes of those proceedings the Guarantor hereby submits to the jurisdiction of the chosen courts and agrees‘that any writ notice judgement or other legal process or document relating to such proceedings may be served on the Guarantor by delivery to or service on him or his agent in the Republic of Ireland being of, or elsewhere as the case may be. This Guarantee shall be construed and take effect according to the law of the Republic of Ireland in force at the time any such proceedings are begun. In this Guarantee where the context so admits words denoting the singular number only shall include the plural number also and vice versa. Words denoting the masculine gender only shall include the feminine gender also and words denoting persons only shall include companies and this Guarantee shall be construed and take effect accordingly. This Guarantee is and will remain the property of the Bank. DATED this day of, Limited (the Guarantor) For and on behalf of acting pursuant to a Resolution of the Board dated day of a certified true copy of tyhich is enclosed. 19 * • completion whoro tha .... Signature (Director or Socrattry) guarantor laa company and scaling la not Signature.............................. .......... Address-..... Witness •Occupation. The Common Seal of C ^^L im ite d (the Guarantor) was hereunto affixed In the presence of: Director . ■ For conation wharotho guarantor laa company and sealing b raqulrad. Director/ ••• >111 Signature. Witness Address...... Occupation SIGNED BY..... .......... ..................................... For completion • the presence of: Signature L whara th« v f t / / S S S J- • Occupation........../{fc&fiftr&Mtr...}... SIGNED BY............... in the presence of: Signature. Witness Address..... Occupation. SIGNED BY...... ;....... In the presence of: ’ Signature, Witness Address..... Occupation. wHwrrchaM ara ...... ..... ............ .ividual aavaral Ind G O R E & G R I M E S 'I AGG\JL B02801.46 The Inspectors, 3 Floor, Trident House, Blackrock, Co. Dublin. RE: 19 November, 2001 MR JO H N B Y R N E A N D T H E A N S B A C H E R EN Q U IR Y Dear Sirs, This letter is written following the invitation contained in the letter dated the 25th October 2001 from the Inspectors to Mr John Byrne to respond to the Inspectors ‘Preliminary Conclusions’. 1. T H E TR IS T A N S E T T L E M E N T 1.1 The statement in this section is inaccurate in asserting that Mr Byrne stated that the structure of the group of companies owned by the Tristan Settlement was similar to the structure described in respect of the Prospect Settlement. No such evidence was given and the statement of Mr Byrne furnished to the Inspectors makes it perfectly clear that both the Tristan and Prospect Settlements were ‘founded in such a way that they are controlled by the trustees of the respective trusts’. The group of Irish companies under the Prospect Settlement are controlled by Mr Byrne, whereas the group of companies under the Tristan Settlement are controlled by the trustees of that trust. The Inspectors are not entitled as a matter of law to ignore the perfectly valid, legally constituted structure established in the Cayman Islands almost thirty years ago. 1.2 In addition, Mr Byrne furnished the Inspectors with two charts explaining the corporate structure. One was headed ‘Irish Company Structure’ and the other was headed ‘UK Company Structure’. It is clear from the transcript that these charts were accepted by the Inspectors as an accurate reflection of the legal status of the various companies under the ultimate ownership of both settlements and as showing Mr. Byrne’s position as a director and shareholder of only the Irish companies. 1.3 It is clear from the UK Company Structure chart, which was accepted by the Inspectors, that Mr Byrne is not a director or shareholder of any of the companies comprised in the Tristan Settlement. The evidence of Mr Byrne was that the Tristan Settlement trustees control the trust and Tristan Securities Limited and its subsidiaries. In so far as the Inspectors understanding of the Tristan Settlement is concerned therefore, the Inspectors have misunderstood the legal structure of the settlement and the manner in which it has operated in a fundamental and basic respect. There is simply no evidence either in the statement of Mr. Byrne or in his sworn evidence to the Inspectors which leaves it open for the Inspectors to reach the conclusion which they have purported to reach in the last sentence of this section. 2. TH E PR OSPECT S ETTLEM EN T 2.1 It is factually incorrect to state that the companies beneath the Prospect Settlement ‘typically had various categories of shares which vested ownership in the next highest corporate vehicle while retaining control in the hands of Mr Byrne’. As is clear from the company structure, the Prospect Settlement is controlled by its trustees. Prospect Settlement in turn owns 100% of the shares in Prospect Holdings, a Cayman unlimited company. Mr Byrne is neither a director nor a shareholder of Prospect Holdings. Mr Byrne is a director of Carlisle Trust Limited and holds, together with his wife the voting ‘A ’ preference shares. All of the non voting ‘B’ ordinary shares are held by Ansbacher as trustee for Prospect Holdings. 2.2 The preliminary conclusion then goes on to assert ‘some of these entities (ie within the Prospect Settlement) were Clients of Ansbacher’. The only such entity which was a client of Ansbacher was Prospect Holdings. 3. G E N E R A L FIN DINGS ON S T R U C T U R E 3.1 It is factually incorrect to conclude that the Tristan Settlement provided cash backing for the borrowings of the Irish companies ‘for no reward’. The Inspectors have accepted that Tristan Securities Limited earned interest on the monies which were deposited. 3.2 Both the Tristan and Prospect Settlements are discretionary trusts. The potential beneficiaries under each of the Settlement Trusts include Mr Byrne’s family. It is therefore unremarkable that the directors of Tristan Securities Limited should have decided to provide security for Irish companies controlled by Mr Byrne and his wife for the benefit of their family. It is difficult to understand therefore, how the Inspectors can conclude that the provision of cash-backing by Tristan Securities Limited for the borrowings of the Irish companies ‘is a very strange use of trust money’. The Irish companies of which Mr Byrne and his wife were directors (and in the case of Carlisle Trust Limited, the holders of all the voting ‘A ’ preference shares) undertook very substantial commercial developments in Ireland over many years. It is, with respect, not surprising at all that Mr Byrne and his wife, as directors of the companies would be called upon by lending institutions to provide personal guarantees. It is a common feature of Irish commercial life that lending institutions require personal guarantees from company directors. The guarantees were given to Guinness & Mahon and institutions other than Ansbacher who lent money to the companies of which they were directors. In so far as the alleged payment of £3,500 to Mr Byrne is concerned, it is important to remember that this isolated payment was made in April 1990. There is no evidence that Mr Byrne himself procured or made the payment. In the context of the scale of funds held to the order of Tristan Securities Limited the said isolated payment cannot be of any significance. The Inspectors’ summary in relation to the Ballymadun Stud loan contains the following inaccuracies:(a) The loan was cash backed by Hamilton Ross not by Hamilton Ross/Ansbacher. Hamilton Ross is not owned by Ansbacher, and is not the subject matter of the Inspectors’ investigation. (b) The J6 Account is not a Hamilton Ross account. It is an Ansbacher Memorandum Account relating to Tristan Securities Limited. As explained in our letter of 26th of February 2001, the payment of monies to the J6 Account was an error by IIB, of which Mr Byrne was not aware until it was brought to his attention by the Inspectors. (c) The IIB internal documentation does not confirm an “Ansbacher connection”. It confirms a connection with Hamilton Ross. The statement in the preliminary conclusion concerning the Ballymadun Stud loan to the effect that Mr Byrne’s explanation is ‘rejected as failing to disclose the full extent of the terms and conditions under which the money was advanced’ is not open to the Inspectors on the facts, nor is it open on the facts for the Inspectors to conclude that Mr Byrne was the real beneficiary of this transaction. Mr Byrne has furnished an explanation and has sought and obtained details from his bankers the detail of which is set out at paragraph 5 of our letter to the Inspectors dated 26th February 2001. There appears to be a typing error in the reference to letter of February 28th 2001 which should be February 26th 2001. It would be grossly unfair for the Inspectors to base any conclusion upon communications received by Mr Byrne from Ansbacher in circumstances where Mr Byrne, at the request of the Inspectors (and indeed the Moriarty Tribunal) has corresponded with Ansbacher informing them that he has no objection to providing the information to the Inspectors. IN S P E C TO R S C O N C L U S IO N S The trusts as established did transfer ownership to the trusts of the assets that were transferred. The trusts are controlled by the trustees and not by Mr Byrne. In the case of the Prospect Settlement control of the trust rests with the trustees but control of the Irish companies owned by the trusts was retained by Mr Byrne. In the case of the Tristan Settlement there was no objective of retaining control for Mr Byrne, and control of that entire structure rests with the trustees. The basis for the Inspectors’ conclusion that “the trusts as operated did not appear to retain the legal separation necessary to achieve Mr Byrne’s objective” is not understood. The trusts exist and, as accepted by the Inspectors at the third paragraph under the heading General Finding on Structure, remain separate. The trustees have, as a matter of fact and law, for almost thirty years operated as they were intended and they have at all times been controlled by their respective trustees. A clear indication of this fact is that despite Mr Byrne’s request that the trustees co-operate with the Inspectors in providing documentation, the trustees decided that they were under a fiduciary duty which prevented them doing so, and they refused that request. There is, with respect, no evidence to justify the Inspectors’ conclusion as set out in this paragraph. Mr Byrne’s relationship with the operating companies i.e. Carlisle Trust Limited and its subsidiaries is not in issue. Mr and Mrs Byrne at all times controlled these companies. The Inspectors suggestion that “Mr Byrne’s true relationship with the operating companies is indicated by the personal guarantees” is not understood. There is no evidence to support the conclusion that the funds held by Tristan Securities Limited in Ansbacher in Ireland were available for any purpose to Mr Byrne whether at any time or at all, nor is there any evidence to suggest or support the conclusion that Mr Byrne (as opposed to the directors of Tristan Securities Limited or the trustees of the Tristan Settlement) had power to apply or did apply them as he thought fit. It cannot be the case as a matter of law that the onus of proof rests upon Mr. Byrne to disprove this. Mr Byrne has made a statement and has given direct sworn evidence that he did not control the funds of Tristan Securities Limited, and that these were and are controlled by the directors of Tristan Securities Limited and ultimately by the trustees of the Tristan Settlement. The Cayman records have been withheld from the Inspectors by the trustees in Cayman. Mr. Byrne’s evidence that he has informed the trustees that he has no objection to them co-operating with the Inspectors has not been challenged. The legal opinion obtained from a reputable firm in the Cayman Islands has been explained to the Inspectors. It is not open to the Inspectors to draw any inference in this regard or to conclude that the control of the trust funds rested with Mr Byrne at all times. Mr Byrne’s power to change the trustees is a fiduciary power and could not be exercised by him for his own benefit (or for the benefit of the Inspectors). It does not, therefore, confer on him control of the trusts. 6. IN S P E C TO R S PR ELIM IN AR Y C O N C L U S IO N S W e note the Inspector’s proposed conclusion that Mr Byrne was a client of Ansbacher. W e do not understand what is meant by the term “client” in this context, or indeed the period in respect of which it is alleged Mr Byrne was a client. If it is suggested that Mr Byrne was a “customer", this is emphatically not the case, either as a matter of fact or law. Mr Byrne never had an account with Ansbacher and accordingly cannot as a matter of law be a customer. Mr Byrne accepts that he asked Ansbacher to provide the two trust structures. Once the trusts were established the trusts became the clients of Ansbacher. Mr Byrne fuily accepts that Prospect Holdings and Tristan Securities Limited were clients of Ansbacher as indeed were the trusts themselves. We do not accept that asking Ansbacher to provide the two trust structures makes Mr Byrne a client of Ansbacher. Even if it does, that client relationship terminated once the trusts were established and Mr Byrne was never a client of Ansbacher during the period of the existence of the trusts. W e would ask you to confirm that you will take into account the various points made in this letter, and look forward to receiving your revised preliminary conclusions. Yours faithfully, G O R E & G R I M E S ----------------------------S OL i C (TO R S---------------------------CAVENDISH HOUSE. SMITHFIEI.D. DUBLIN 7 TEL: 35.1 - I - X72 *)2‘W FAX:35.1 - I - H72 '. YO,KR,a:: . ... .. 26 February, 2001 JOHN BYRNE ANSBACHER ENQUIRY Dear Ms Cummins, Further to the attendance of Bill Shipsey and myself with our client, Mr Byrne, on the 24th January last and your letter of the 2nd February, I have pleasure in providing you with the results to date of our further enquiries into the outstanding requirements made by the Inspectors in the course of Mr. Byrne's examination. At the outset, however, i wish to deal with a number of matters that arise from a reading of the transcript of evidence. A. Mr. Byrne has no objection, and has never had any objection, to the Trustees of the Tristan and Prospect Settlements furnishing documents to the Moriarty Tribunal or the Inspectors. With respect, however, we do not accept the suggestion made by his Honour Judge O'Leary during the course of the examination that the removal by Mr. Byrne of the trustees of either or both of the settlements would have the effect desired by the Inspectors. I confirm that I have taken legal advice on my client's behalf on this very point and have been advised by a highly reputable firm of Cayman lawyers, Bruce Campbell & Co., that another Cayman Island trustee would be likely to adopt the same position as that adopted by Ansbacher Cayman in refusing to disclose information unless ordered to do so by a Cayman Island Court. As you are aware I have written on behalf of Mr Byrne to the Trustees asking them to co­ operate fully with the Inspectors and confirming that Mr Byrne has no objection to their co-operation. In the light of the advice which we have obtained, and our client’s co-operation with the inspectors, the \v r.iim-iiuiui-s. mu in t.i• ASSIXIATIs; \X\ Kl'\lI.NVi.UAM COI.IINS.SIAN M \KI'IK.H» Wo'M II« characterisation by Judge O ’Leary of our client's position in relation to this matter as “disingenuous" is unfair. B. My client is perfectly satisfied that the two trusts established on his behalf in or about 1971 are and were fully legally compliant. We were most concerned to hear a suggestion in the course of his interview that the Inspectors might conclude that one or both of the trusts were a sham. We fail to see how such a construction is open, or how the terms of reference of the Inspectors could extend to deciding whether trust structures established in 1971 were or were not properly constituted and run. As was made,clear by the Inspectors during the course of the examination, neither Mr. Byme nor the Prospect or Tristan Settlements are the subject of the investigation and it would, therefore, be quite wrong and inappropriate, in our submission, for the Inspectors, charged as they are to investigate the affairs of Ansbacher (Cayman) Limited, to pass judgement by inference on the validity or legality of the Prospect and Tristan settlements. Entirely without prejudice to the above, it is quite dear that there is no legal or factual basis whatever for contending that either trust is a sham. Furthermore such a contention would give rise to very complex legal and factual issues which could not be determined in an enquiry of this nature. C. My client does not accept that Carlisle Trust Limited or indeed any of the Irish companies whose loans were secured by Bank Guarantees or by back to back deposits from Tristan Securities Limited were themselves required to record the details of such security in their accounts. I have taken advice from a Senior Counsel who specialises in this area of law, and I am advised that there is and was no legal obligation imposed upon the Irish companies pursuant to the Irish Companies Acts to record details of a security provided by a third party. In this regard, I enclose a Submission of Mr Daniel O ’Keeffe S.C. confirming this position, which I hope will be of assistance to the Inspectors. We would be quite happy to elaborate further on this matter if .................. required. Turning to the specific queries raised during the course of the interview and reiterated in your letter of the 2nd February, I am instructed to reply as follows:1. I have written to the trustees of the Prospect Settlement to seek to confirm the current shareholdings in Prospect Holdings. They have confirmed that the issued share capital of Prospect Holdings is 20,800 Ordinary Shares. These are registered in the name of Overseas Nominees Limited (an Ansbacher nominee company) and are held on behalf of Ansbacher (Cayman) Limited as trustee of Prospect Settlement. All other classes of shares have been redeemed. 2. There was no payment ever made by Carlisle Trust Limited in respect of the backing facility provided by Tristan Securities Limited. Tristan Securities Limited was earning significant interest on the monies which it had deposited as part of the back to back arrangement. We have provided you with copies of both the Tristan and Prospect Settlements and the documentation relating to them. As you will have seen both Settlements were established by or on behalf of the same person. Both Settlements have the same Trustees. Both Settlements were set up with the intention of ultimately benefiting the same class of potential beneficiaries, namely the members of Mr John Byrne’s family. 3. Mr. Byme has no recollection of either requesting or receiving the Guinness & Mahon draft for £3,500 in 1990. It would appear from the information you have furnished that this bank draft was obtained from Guinness & Mahon by the late Mr Desmond Traynor. Mr Byme does not know why it was debited to the Ansbacher Cayman account, and was not aware of the fact that it had been so debited until this information was furnished to him by the Inspectors. 4. In relation to the American Express card, we have written to American Express to seek to ascertain whether a card was issued in our client's name in 1989. To date we have not heard back from American Express but will write to you when we receive a response. 5. I have now ascertained from Irish Intercontinental Bank (IIB) that on the 28th April 1994 they advanced a loan of £212,000 (net of fees £211,060) ("the Loan”) to Ciara Byme, wife of John Byme, and owner of Ballymadun Stud (“the Stud"). The IIB Solicitors, Arthur Cox, advise me that you have been furnished with:(i) Facility Letter issued by IIB dated 25thApril 1994. (ii) Personal guarantee given by John Byme dated 26th April 1994. (iii) Letter from Mrs Ciara Byme to IIB dated 26th April 1994. I have obtained a copy of the Bank Statement of the Stud (“the Bank Statement”) with Bank of Ireland, Rotunda Branch (BOI), for the relevant period, and I attach a copy. You will note that on the 28thApril 1994 a payment was received of £211,060 and is designated as coming from IIB. You will also note a payment out of the account dated 3rd May 1994 of the sum of £211,060. I have obtained a copy of the cheque from BOI and enclose a copy. You will note that it is signed by Patrick Byme, drawn in favour of IIB, and received by IIB on the 29thApril 1994. it is stamped by IIB and marked “not negotiable". I have asked IIB to advise me as to where this money was lodged. The cheque for £211,060 sent to IIB by the Stud was a repayment of moneys which had been expended by Mr Byme over a period of almost six years for the benefit of the Stud. I have also ascertained from the Bank Statement, that on the 1st September 1994 a credit of £251,631.63 was received from Finers Solicitors. Finers are Mr Byrne's London Solicitors and Mr Byme has ascertained that this sum represented an amount due to him from the proceeds of sale of a London property. You will note that at the same time there was a debit on the Bank Statement of £217,483.04 which is marked Telephone Payment". Mr Byme believes that this was a repayment of the Loan together with accrued interest. I have written to MB’s Solicitors to ask them to confirm ttiis matter. My client is waiting for formal confirmation from IIB as to precisely where they deposited the proceeds of the cheque for £211,060 which they received from the Stud. It appears from the information furnished by the Inspectors that a sum of SGT£203,841.75, presumably the Sterling equivalent of IR£211,060, was lodged to Account No. 80019005 in IIB in September 1994. This is recorded in the Memorandum Account J6, a copy of which you have furnished to us, and is described as coming from Ballymadun. I have written to lib to check their records to see from what account the said payment was received and on whose instructions the payment was made. Mr Byme did not give any instructions for this money to be transferred to the J6 Account, and if it was so transferred then this was an error which has not been brought to Mr Byrne’s attention by the Inspectors. Mr Byme confirms that the Stud did not borrow moneys from the Trust Companies or the Trusts. There are a number of small points in relation to the transcript of evidence that I would like to draw to your attention:Page 2 - This should state instructed by Mr Anthony Gore-Grimes and not by Mr John Gore-Grimes. Page 8, Line 1 2 - 1 believe that the word “him” should be “them” as I believe that Judge O ’Leary was referring to the date on which Mr Byme started to do business with Guinness & Mahon Cayman and not the date on which he started to do business with Mr Des Traynor. Line 18 - Same point. Line 22 - Same point. Page 30, Line 14 - 1believe the first word should be “pejorative” and not “unpejorative". Y ^ Page 64, Line 21 - the word “invariably" should be deleted. Yours sincerely, to t 2 _ Anthony Gore-Grimes Appendix X V 1. (9) M r Patrick C a r t y & M r s Beatrice C a r t y Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Patrick Carty & Mrs Beatrice Carty. a) Transcript of evidence of M r Paul Carty of 31 M a y 2000. b) Letter of 26 April 2000 to the Inspectors from Paul Carty. c) Deposit Dealing Ticket. d) C a y m a n International Bank & Trust C o m p a n y Ltd statement of 6 October 1994. UNDER OATH ON WEDNESDAY, 31ST MAY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. PAUL CARTY 1 2 MR. JUSTICE COSTELLO: 3 Mr. Carty, we will start our interview now. I will 4 introduce myself first. 5 On my right is Miss Mackey and on my left is 6 Mr. Rowan. 7 High Court to investigate the affairs of the company 8 referred to in the order. I am Declan Costello. We are the inspectors appointed by the 9 10 Mr. Carty this is an interview and we would ask you 11 to take an oath. 12 administer the oath to you. 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 We will ask Ms. Cummins to 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: Mr. Carty, if you could 5 give us a brief outline of 6 7 your professional career and background? A. 8 Certainly. Is this interview in relation to myself or to others? 9 2 Q. 10 A. Purely in relation to yourself. My background from my career, I qualified as a 11 chartered accountant in 1965 when I joined a small 12 firm and became a clerk. 13 firm of Haughey Boland. 14 became a partner. 15 merged, Haughey Boland merged with Deloitte Hassetts 16 & Sells. 17 Deloitte & Touche. 18 Deloitte & Touche from January 1991 up to 19 31st December 1999. 20 partner in the firm of Deloitte & Touche. 21 3 Q. On 1st May 1991 it merged with I was managing partner of 23 Mr. Carty (Exhibit 1)? 25 4 Q. At the present time I am a If we could now look at your letter to us of 26th April. A. On 31st December 1971 I On 31st December 1986 that firm 22 24 Then in 1967 I joined the Have you got a copy of it there, Yes, Mr. Costello. You say you have never been an settlor of any trust 26 in Ireland or overseas. 27 the discretionary trust that your -- was it your 28 father who established it? 29 A. Yes, my father and mother. Would you tell us about My parents. 1 5 Q. 2 I am wondering who actually established it; in whose name? 3 A. 4 6 Q. 5 A. 6 7 Q. 7 A. 8 8 Q. 9 I think both. What was your father's name? Patrick Carty. What was your mother's name? Beatrice. Did you know they were establishing this trust. Did they talk to you about it? 10 A. 11 9 Q. After it was established? 12 A. After it was established. 13 10 Q. 14 A. 15 11 Q. 16 A. 17 Not at the beginning, I knew later on. How long after? Shortly afterwards. Do you know for example who advised them? I insofar as I know they went to Mr. Traynor. My father knew Mr. Traynor. 18 12 Q. 19 A. What was your father? My father was a businessman, a self-made 20 businessman. 21 But nothing of substantial means I should say. 22 13 Q. 23 24 A. 29 He did, yes. In fairness, they would have come back to me at some stage and mentioned it. 14 Q. 27 28 Your father went to Mr. Traynor and he took the advice of Mr. Traynor? 25 26 A shopkeeper in the late 1960's. I am just wondering did they mention it in the course of the negotiation? A. No. I would say in fairness that probably before they signed up anything, they might have said 1 2 That is what I would have thought. 3 accountant. 4 would have been strange if your father hadn't talked 5 to you about it? 6 A Yes. You were an You were a partner in the firm. My father and my mother -- I had a closer 7 relationship with my mother than my father. 8 they would have spoken about it, yes. 9 16 Q 10 11 about it? A Yes, they could have told me about it. I would have to agree. 13 assume they would have said something to me. 14 17 Q 15 A It is 30 years ago. I would have to Did they tell you why they were doing this? In a way my mother was the bigger influence in the 16 family. 17 to leave something to her children. 18 of u s . 19 was a family type of situation. 18 Q 21 22 A There was four I think it was more in that context. It Was there any explanation made about tax savings as They had a very small amount. It was taxed income that they had saved. 19 Q 25 26 My mother always felt that she would like a result of going out o f ...(INTERJECTION)? 23 24 But Before it was established, signed up, they told you 12 20 It I am wondering why a trust was being set up offshore. A It was an offshore trust, wasn't it? It was the Channel Islands. Later I understand it 27 was the Channel Islands. That is where it started, 28 yes . 29 Did they give you any explanations as to why they 6 1 were doing it in the Channel Islands and not in 2 Dublin? 3 4 21 Q. 5 6 Did they explain to you what Mr. Traynor said to them as to why they were doing that? A. They gave me no great details, Mr. Costello, other 7 than it was a trust that was being set up and it was 8 going to benefit the children. 9 22 Q. 10 11 Did you not know it was being set up in the Channel Islands? A. Yes, I do and eventually it was. When I was aware 12 of it being set up my view would have been that it 13 was tax avoidance rather than tax evasion. 14 23 Q. Of course. I am not at the moment making any value 15 judgment. All I am saying is that it does seem to 16 me strange that they would have set it up in the 17 Channel Islands unless this was for tax avoidance of 18 some sort. 19 A. 20 24 Q. 21 A. 22 25 Q. 23 A. 25 26 Q. 26 A. 27 29 Yes, avoidance, yes. Did you ever see the deed of trust, Mr. Carty? No. We would require to get the deed of trust. Can you get it for us? 24 28 And did you know that? I will enquire certainly. Do you know who the trustees were? No, other than whoever was Guinness & Mahon in the Channel Islands. 27 Q. You yourself knew Mr. Traynor? 1 28 Q. 2 You know the setup of the companies in the Channel Islands? 3 A. 4 29 Q. Tell me what ...(INTERJECTION)? 5 A. How companies are set you mean? 6 30 Q. I do, Mr. Costello. No. I am asking you about the setup of the 7 subsidiaries of Guinness & Mahon in the 8 Channel Islands? 9 A. 10 document. 11 31 Q. 12 A. 13 32 Q. 14 15 From that I only know what I read here in your You didn't know since? No, it is from the document. You didn't know of Guinness & Mahon Jersey Trust company or College Trustees? A. I knew Guinness & Mahon like other banks in Dublin 16 operated trusts. 17 only one in Dublin. 18 33 Q. 19 A. 20 34 Q. 21 A. 22 23 Guinness & Mahon were not the They had a subsidiary which managed trusts? Yes. You didn't know the name of it? I learned more information from the document here than the knowledge I would have had. 35 Q. I want to look at a document on page 31. This was 24 an internal document of Guinness & Mahon. 25 see that it is dated 23rd January 1979. 26 photostat is obliterated. 27 "re letter of wishes of Paul Carty (Exhibit 2) 28 A. 29 36 Q. You will The It is to Mrs. Cahill Yes. How does your name appear on that? 1 Can I say, Mr. Costello, 2 documentation -- I know you don't have to give it to 3 me -- before this meeting. 4 out of courtesy of procedures. 5 expected that I wouldn't get surprises. 6 disappointed that...(INTERJECTION). 7 37 Q 8 A 9 38 Q 10 11 I did request sight of I just make the point I would have I am I am sorry we cannot get into an argument? I just make the point. I want to tell you, we have very good reasons why we adopt the procedures we adopt, Mr. Carty. A Okay, thank you. First of all I will say at the 12 outset, I have no trusts or offshore money and never 13 had. 14 here I would think might relate to a situation where 15 I knew I was a beneficiary from my mother's and 16 father's trust. 17 I put a letter, which is a very small letter of 18 wishes -- I don't know if Guinness & Mahon still 19 have it -- saying that if anything untimely happened 20 to me how it would benefit my family. 21 that relates to. 22 mine . 23 39 Q 24 A 25 26 At one stage I was going away. That is all It does not relate to money of Do you remember this, Mr. Carty? No, I don't remember it at all. to me. 40 Q The letter of wishes that is spoken about This is a surprise But it is 1979. Of course, it is a long time ago. I am wondering 27 how there is a document on the file of 28 Guinness & Mahon which refers to a letter of wishes 29 to be signed by you. "The attached letter for 1 safekeeping." 2 3 41 Q. 4 5 Explain to me why if you were a beneficiary under the trust you would write a letters of wishes ? A. Purely from the point of view that if anything 6 happened to me and my mother and father, that I was 7 a beneficiary under the will and the trust. 8 have thought that would flow then automatically to 9 my estate. 10 42 Q. 11 A. 12 43 Q. 13 14 Have you experience of discretionary trusts? Not great experience. Have you ever assisted clients in discretionary funds ? A. No, but I would have been familiar with discretionary trusts. 15 16 I would 44 Q. 17 We know that discretion is given to the trustees. They have absolute discretion? 18 A. 19 45 Q. Yes. The discretionary trust scheme depends then on the 20 trustees carrying out the letter of wishes which the 21 settlor gives them. 22 A. 23 46 Q. 24 A. 25 47 Q. 26 27 You knew that? I knew that. You were not the settlor, Mr. Carty? No, certainly not. How did it come about that you wrote a letter of wishes and were involved? A. Purely from my interpretation of that, automatically 28 thinking that if my mother's wishes were that 29 Paul Carty would benefit, I thought that would flow 1 to my children and my wife. 2 still thought that. 3 48 Q. 4 A. 5 49 Q. 6 7 Actually I would have A letter of wishes goes to the trustees? Yes. How could a letter from you have the slightest effect on the trustees if you were not an executor? A. Other than Mr. Traynor knew the family and somewhere 8 along the way he is a trustee or part of the 9 trusteeship I would have thought in 197 9. 10 50 Q. 11 A. 12 51 Q. 13 Did he mention this to you? No, but he knew I knew of the existence. But did he mention to you about writing a letter of wishes ? 14 A. 15 52 Q. 16 A. No, I did that myself. Do you remember doing this? I have a vague recollection of doing something. 17 I have a vague recollection. 18 with my vague recollection. 19 53 Q. 20 A. 22 54 Q. 23 A. 24 55 Q. 25 12th December 1987. When did your mother die? 15th June 1990. During the period when your father was alive did you ever obtain any funds from the trust? 26 A. 27 56 Q. 29 When did your father die? 21 28 If we can move on, Mr. Carty. I am just responding No. During the period that your mother was alive did you ever gain anything from the trust? 1 57 Q. 2 A. Did you know how your father used the funds? No, I didn't know how he used them. They were quite 3 sensible and if I might say, they didn't spend much 4 money my parents. 5 58 Q. I take it, Mr. Carty, if you didn't know before you 6 would have known from the papers about the Ansbacher 7 accounts ? 8 A. 9 59 Q. 10 A. 11 60 Q. 12 Yes. And the coded accounts from Guinness & Mahon? Yes. And the people with trusts were able to use... As set out in our letter to you? 13 A. 14 61 Q. 15 Yes. Do you know did your father utilise any of those services ? 16 A. 17 62 Q. He might have, yes. Can you recollect whether you were involved in any 18 way with that or helping him about getting funds for 19 him out of the money? 20 A. 21 63 Q. 22 No. But he may have used a Guinness & Mahon account in Dublin, a coded account in Dublin to withdraw funds? 23 A. 24 64 Q. 25 A. In the end, yes I was. 26 65 Q. You were his executor? 27 A. 28 66 Q. 29 He might have, yes. You weren't his executor? Yes. Do you recollect whether the funds were referred to in the affidavit of assets? 1 2 67 Q. 3 A. 4 I can make an attempt to get that, Mr. Costello, yes . 5 68 Q. 6 A. 7 8 You can get us the affidavit of assets? Who was your solicitor in those days? Mr. Andrews of a place in Merrion Square called TP Robinson. 69 Q. 9 Were you executor of your mother's estate at that stage ? 10 A. 11 70 Q. 12 A. 13 71 Q. 14 A. 15 72 Q. Yes. Were the funds referred to in the affidavit? No. Could you get us that affidavit too? Yes. After your father's death did you have any 16 discussion with Mr. Traynor and/or your mother about 17 the money that was...(INTERJECTION)? 18 A. 19 73 Q. 20 21 That is what I am wondering, how that happened. Was there any approach made to the trustee? A. 22 23 No, I think it continued on with my mother. I understood from my mother and father that it was a joint type of trusteeship. 74 Q. It wasn't one person. Mr. Carty, the usual form of trust is for a father 24 or a husband to establish a trust and state who the 25 beneficiaries are. 26 wife and his children perhaps? 27 A. 28 75 Q. 29 They would include himself, his Yes, I understand that. What you are suggesting is that it wasn't the usual form, that it was a joint trust? 1 Yes, I am suggesting that it was my mother's money, 2 not alone my father's money. 3 76 Q 4 A 5 77 Q 6 That is what I think, yes. Do you know, was any money transferred to the trust in the life-time of your father? 7 A 8 78 Q 9 A 10 79 Q 11 A 12 80 Q 13 14 You think they both set up a trust? No, at the beginning. Nothing after that. You never contributed to it? No. As far as you know nobody added money to the trust? Certainly not. Then, Mr. Carty, after your mother's death what happened? A I would have met Mr. Traynor on other issues, 15 Mr. Costello. 16 some difficulty with one of the family. 17 why the trust didn't get terminated until 18 October 1993. 19 were some difficulties there. 20 speak to me. 21 other brothers and in October 1993 the trust was 22 terminated and a distribution was made. 23 saw any documentation or I didn't ask Mr. Traynor 24 for any documentation. 25 of what was there. 26 81 Q 27 A 28 29 It was mentioned. And there was That is I have a brother in Germany. Mr. Traynor did I spoke to my colleagues and my two I never I didn't ask for any proofs I just wanted to terminate. Did you ever get an account of...(INTERJECTION)? No, nor did I ask. I think there were three payments made. 82 Q There Did you know if your mother ever asked for an 14 1 2 3 83 Q. 4 A. 5 84 Q. Did your father ever ask for an account? No. I have never seen any. Did you take any advice, Mr. Carty, in relation to 6 the funds that you obtained as to whether or not any 7 tax liability on you would obtain? 8 A. 9 85 Q. 10 But did you take advice in relation to the obtaining of these funds? 11 A. 12 86 Q. 13 A. 14 15 All my tax affairs are up-to-date, Mr. Costello. I understand the position as regards these funds. You took advice? No, I took my own advice. I dealt with the tax matters arising from that. 87 Q. 16 There are a couple of matters that I want to refer you to? 17 A. 18 88 Q. Certainly. There was a loan to a company called 19 Morris Insulation Ltd from Guinness & Mahon of 20 £20,000 in 1989. 21 Guinness & Mahon to Morris Insulation Ltd? 22 A. 23 89 Q. 24 A. 26 90 Q. 27 29 I do, yes. I am wondering about the security. You gave the security for this loan to Brian and Paul Carty? 25 28 Do you recall this loan from Yes, Mr. Costello. Was there any other backing deposit for the guarantee that you gave? A. No, Mr. Costello. They were personal guarantees. I think I signed a personal guarantee. 1 You did, yes. 2 frequently want a bit more than a personal 3 guarantee. 4 They may want a deposit? 5 A 6 92 Q 7 A 8 9 As you know very well, banks very They may want something else as well. I had no money on deposit. I have to ask you these questions. I appreciate that, Mr. Costello. I don't mean to be abrupt. 93 Q I want to ask you about a personal loan much 10 earlier. 11 or a bit over that from Guinness & Mahon. 12 joint and several guarantee of Mr. Stakelum, 13 Mr. JF Donnelly and Mr. Michael Norris. 14 remember this 15 A 16 17 I do, yes. It was a You (EXHIBIT 3)? That would be a company called Computime, Mr. Costello. 94 Q 18 19 In 1976 you got a personal loan of £5,000 In the documents that we have you are personally given the money? A 20 Yes because we were investing in a company called Computime. 21 95 Q 22 A You were investing the money? Yes. Mr. Norris, Mr. Stakelum and Mr. Donnelly and 23 myself. 24 company called Computime. We must have been investing £20,000 in a 25 96 Q 26 A 27 97 Q 197 6 and the repayment date was 31st May 197 6? 28 A It was borrowed in 1976 and paid back in 1976? 29 98 Q Cross guarantees were given? Yes. What year was that? 1 present balance was and it says the repayment date 2 was May 197 6. 3 there was no backing deposit? What I am concerned about is that 4 5 99 Q. 6 A. 7 100 Q. 8 9 It was a personal guarantee? Yes. Mr. Stakelum, was he involved with you in this company? A. The four people mentioned were shareholders in the 10 company. There was one other person who ran the 11 company. I cannot think of his name. 12 was one other person who was a managing director of 13 the company. 14 Bureaus were popular at that time. 15 101 Q. But there This was a bureau computer business. Mr. Carty, I have no further questions but 16 Miss Mackey would like you ask you some questions. 17 END OF EXAMINATION OF MR. CARTY BY MR. JUSTICE 18 COSTELLO 19 20 21 22 23 24 25 26 27 28 29 1 2 3 MS. MACKEY: Mr. Carty, getting back 4 for a moment to your 5 parents trust, who did you understand from your 6 parents to be the beneficiary? 7 A 8 103 Q 9 A 10 All four? Not all four. It was either three or four, I am not so sure. 11 104 Q 12 A 13 14 The children. Why do you say that? Because there was a little family -- these transcripts are not made public? 105 Q No, they are not made public. 15 into your family affairs. 16 time that it was three or four. 17 tell you? 18 A 19 106 Q 20 A 21 107 Q 22 A 24 108 Q 25 26 Did your parents They told you it was three? Yes because of the other particular difficulty. Can I have the names of the other beneficiaries, Was it Brian and John? So you know? I am asking you; I am not sure that they are your brothers ? A 27 You must know. MR. JUSTICE COSTELLO 28 29 Did you understand at the It was three. your brothers. 23 We don't need to get Mr. Carty, you are here to answer questions. A I appreciate that but I don't want to be getting the 1 2 109 Q 3 4 The question, Mr. Carty, is the names of the beneficiaries. A 5 Yourself, your brothers? From my understanding my brother, John, and my brother Brian and Paul. 6 110 Q That is the answer. 7 111 Q MS. MACKEY: At the time of the 8 termination of the trust 9 you explained there that it wasn't terminated, it 10 was just after your mother's death because of the 11 difficulty with the brother in Germany, who I take 12 is not one of these three brothers? 13 A 14 112 Q No. When it came to the termination of the trust did 15 Mr. Traynor approach you or did you approach 16 Mr. Traynor about it? 17 A 18 After my mother's death he would have been at the funeral. 19 113 Q 20 A 21 After my mother's death it was discussed. Can you tell me a bit about the discussion? Yes. One of the difficulties was the brother that was abroad. 22 114 Q 23 A Why was that a difficulty? It was a difficulty insofar as he would have seen 24 him having certain rights in my mother's will and 25 also to whatever else there was. 26 important that...(INTERJECTION). 27 As I understand it, he wasn't named as a 28 beneficiary? 29 No. So it was very But it was important that we regularise all the 19 1 -- I didn't want anything reverting back afterwards 2 so it was important that we resolve all our 3 difficulties beforehand. 4 That could have been made clear by production of the 5 trust deed at that stage which would clearly state 6 the beneficiaries. 7 then? 8 A 9 There would be no further doubt I am speaking of the letter of wishes as distinct from the trust deed. The trust deed could have 10 said the four children. 11 think said something less. 12 117 Q 13 14 The letter of wishes I In fact you know what the trust deed said and what the letter of wishes said? A No, I don't know what the trust deed said. I am 15 only trying to give you my best understanding. 16 There was this dispute within the family. 17 could easily have the children of Patrick and 18 Beatrice Carty. 19 letter of wishes did not have one brother provided 20 for. 21 118 Q 22 But my understanding was the Are you referring to the letter of wishes written by you? 23 A 24 119 Q 25 A 26 120 Q 27 A 28 29 The deed No. That we have talked about here? No. There was another letter of wishes? My mother and father must have had a letter of wishes, as I understand it. 121 Q 1 2 122 Q. 3 A. 4 123 Q. 5 A. 6 124 Q. 7 Did you understand this from Mr. Traynor? Yes. What did Mr. Traynor tell you about it? All he said is there are three children. He said to you that there was a trust deed which mentioned the three children? 8 A. 9 125 Q. No, a letter of wishes. And that the trust deed, as I understand what you 10 said a moment ago, would have mentioned just the 11 children? 12 A. 13 126 Q. 14 A. 15 127 Q. 16 A. 17 I think so. He Told you this? I cannot be positive. What did he say about the letter of wishes? The letter of wishes -- that there was Brian, Paul and John. 18 128 Q. 19 A. 20 129 Q. 21 Were named in the letter of wishes? Yes. Was the letter of wishes written by your mother or by your father? 22 A. 23 130 Q. 24 A. 25 131 Q. 26 A. 27 By both. Two letters of wishes? One letter of wishes. One letter of wishes signed? Signed, as I understand it from what I said to Mr. Costello at the outset. 28 132 Q. 29 A. Where would this letter of wishes be, Mr. Carty? It would have been given at the very very early 1 2 133 Q. 3 A. 4 134 Q. To who? To Mr. Traynor. No doubt a copy of that letter of wishes should be 5 with the trustees in the Channel Islands. 6 that be correct? 7 A. 8 135 Q. 9 Would It could be, I don't know. You said your impression would be that the trustees were subsidiaries of Guinness & Mahon in the 10 Channel Islands. 11 Jersey Trust or would it be College Trust ees? 12 A. 13 136 Q. 14 Would that be Guinness & Mahon I don't know which one. Would you write to both of those entities and ask them? 15 A. 16 137 Q. Yes, if you give me the details. We will give you the address after the interview. 17 That is to Guinness Mahon Jersey Trust in the 18 Channel Islands and to College Trustees. 19 them for a copy of the trust deed relating to your 20 parents and the letter of wishes. 21 any other documentation relating to the trust? 22 138 Q. 23 A. 24 139 Q. 25 And if they have Do you know if the trust had a name? I don't know the name. Getting back to the termination, Mr. Traynor talked to you about it just after the funeral? 26 A. 27 140 Q. 28 29 And ask Yes. Was it he who pointed out to you that there was this difficulty? A. No, I would have pointed out to him not to do 1 2 141 Q 3 A 4 5 Why would you have done that? Because of the dispute that was going on with my brother. 142 Q Did he then tell that you that there was this 6 discrepancy between the letter of wishes and the 7 trust deed? 8 A 9 143 Q 10 A No. When did you learn of that? I didn't associate any discrepancies to tell you the 11 truth. 12 wishes I was more relating to than the deed of 13 trust. 14 144 Q 15 A 16 145 Q 17 A 18 19 146 Q A 147 Q Then time passed. Who next raised this? I raised the issue when matters were resolved with You asked Mr. Traynor. What was the content of My view was that the wish was to terminate the That wish was expressed on behalf of your whole family, was it? 25 A 26 148 Q 27 29 Yes . trust. 24 28 You asked him to do nothing for the time being? that? 22 23 Nor did he refer to the discrepancy. my brother abroad. 20 21 At the end of the day it was the letter of My two brothers and myself. What was the next step that occurred. What did Mr. Traynor do? A A distribution took place of a certain amount of money. I think equal amounts of money. 1 149 Q 2 Did you inform Mr. Traynor in writing that you wished the trust to be terminated at that point? 3 A 4 150 Q 5 A 6 151 Q 7 No. You met him or you spoke to him? I probably met him, yes. What did he actually do in order to terminate the trust? 8 A 9 152 Q 10 A 11 153 Q All I know is that cheques were distributed. To you and your two brothers? I don't recall any formal letter. I don't have any further questions, Mr. Carty. 12 Thank you. 13 MR. JUSTICE COSTELLO 14 adjourn for a cup of 15 coffee. 16 much longer. 17 A 18 154 Q 19 A We will adjourn now. 22 23 24 25 26 27 28 29 We won't detain you Not at all, you do that. If we come back in about five or ten minutes. Certainly. 20 21 Mr. Carty, we usually SHORT ADJOURNMENT 1 2 3 4 155 Q. MR. JUSTICE COSTELLO: Mr. Carty, there is one 5 matter that I wanted to 6 clarify. 7 parents' trust was established, the approximate 8 date? 9 A. 10 156 Q. 11 A. 12 157 Q. That is about when you think your I would say 1971. 1971? I would say so about that time. I am just wondering how it came about that the 13 letter of wishes, which you signed, was made in 14 1979? 15 A. 16 My children were all effectively -- there were three children around that time. 17 158 Q. 18 A. 19 159 Q. 20 That is how? That is how it. Do you remember who you gave the letter of wishes to? 21 A. 22 160 Q. I would say I gave it to Mr. Traynor. Very well, Mr. Carty. Thank you, Mr. Carty. 23 This will be transcribed and Ms. Cummins will be in 24 touch with you. 25 sign this transcript? 26 A. We would ask you to come in and Certainly, yes. 27 28 29 THE EXAMINATION WAS THEN CONCLUDED \a D: x5 0.557sz m. Off 7 xx CO ~05. - Jgr E W ifc lT ’Athenree', B e& park, 7 ' 26* April 2000 1 ‘‘ •:.i-'J - CastteknockRaac D u b S n ls . ‘ 4 O S b cx ^ ih e h a p e c ta a • • to Ansbacher (Cayman) Limited 3**Floor ’ Trident House Blackrock . . 2Sm * W .* Co Dublin t . should mention xrqrlate paroqta did have a discretionary trust in 'which I was a beneficiary. TK» ♦rn«>«-m « twriTnofnH »ft«r my mfrihcr’a death and term inalon ^jpointmeixts were n»de in or apouhd October 1993 throogh Mr. JJD. Traynor. I shared in such ^pohrtaaantat thattin^^ . * .J Yours feithfully, & Paul Carty 1 DEPOSIT DEALING TICKET TtaaauryCopy_________ I o» so n a -: • HXED Custamar 1 c r & r e - s ConwetNo. • . L 3 & 4 0 7 £ $ . O? / c v o s ^ /S t, AUTHORISATION BREQUREDI NOSTRO W - D e O O T ' i ^ .VVVPCJRQW*"*wl ■CCSfJIon u«pow V t e f t W 'j l o a r X t O O .Cwncy - P g A •AiritW*-' J '-5S • .-MWt:.* : NOSTRO OUT— lOAIL-L ••.*?-v-V . •--ft•: -------- #/ 3 S ?r^ & > / (’W ’9 t c c WicraOB your A/C / • Start(Ml MaturityOatt clel* IHM1 H f nil Of l l O » ?J U - NOSTRO . 1-----------------------------CoiAmallonCO I ParClMqu* . / . J 1 * * t / --------------- ------------ -------------- . .. •■ .........." ~ a . o 5 o ^ * CAYMAN I»(TE^J*AT10*»AL iANA * TRUST CO.IPANY L tn lT E u C /O C Q hP ufiA rt iE rtV fC tS aTTH Hk it REllHUNU . DvUin2. ' . T«tephatM. Q )Mi9744 Tokx: 33332 FaorfmOe: (01)4713034 ■ A/C: 0 t /d l0 i7 /» l bSP uEP CL 3£H SOM «fcS •m m c i t u n co p y * * statsm n t Q A rti OAflCTf4 PAOS Mil 1 004 OATS 30StP?Ji8HQu«hT FCftriARD ‘ 3UStP93> Curth.LOAH r/H *0360) INTEREST to J0SEF93 S.74904000 040CT*3 Mbb C* «ATE ' Q«0CT91 ulThORAWAL UITH0RA4AL T/P • WITHDRAWAL T/P SAJICLAYS BllPLC SI.FLEET ST LONOON EC4Y I2T 120CT93 CN 133938 LOOSEHEUT Cll 133149 L006EWCNT T/P Cn 133S49 LOOfaEnEMT T/P CN 133849 LOOaEMENT T/P CM 133449 LOOfiCiEhT T/P Cfc 133349 LoOuBHE.*iT T/P CN 13X49 L«>0 3 Mccgm m qeit uwi. D**r Mite. iw r s u s s t ix v r s s m Yours rln ca rtly . TX U BM K---MNMOt ACCOUNTS. t is ' *'« t * «».»♦•» “ GUINNESS-t-MAHON LTD 17 College G rm Dublin 2 RQ Box 5SA 'fetephonerTBatM Our R e f: PO'D/MR. 1 2 th November, 1975. • Th e S e c r e ta r y , Gom brette L im it e d , La M otte Chambers, S T . H ELIER , Je rs e y. Dear S i r , . Ve r e f e r t o o u r F a c i l i t y L e t t e r dated 14th Kay 1975, p la c in g a t y o u r d is p o s a l a f a c i l i t y o f £247,500 (Two Hundred and f o r t y Seven Thousand F iv e Hundred Pounds) to en ab le you pu rch ase 9 0 0 ,0 0 0 Jam aica Sugar E s ta te s L im ite d O rd in a ry S h a re s . Ta k in g I n t o ' c o n s id e r a t io n t h a t th e f a c i l i t y matures on th e 16th I n s t . , ve he re b y c o n firm t h a t we are prepared to extend yo u r Loan f o r a f u r t h e r p e r io d , s u b je c t to the fo llo w in g term s and c o n d it io n s : (1 ) * You may c o n tin u e to a v a i l o f the f a c i l i t y b y way o f Loan A c c o u n t. (2 ) In accordance w ith normal banking p r a c t i c e , a l l sums b e in g a v a ile d o f a re re p a ya b le on demand, b u t i n any ca se not l a t e r th a n 3 1 s t March 1976. (3 ) We propose t o co n tin u e c h a rg in g / in te r e s t on th e f a c i l i t y a t 14}% p e r annum, such r a te a h a S U be a p p lie d t o th e Loan d u rin g th e e x te n s io n now b e in g g ra n te d . In t e r e s t s h a l l be d e b ite d to th e A ccount on the u s u a l q u a r t e r ly dates and we s h a l l a p p ly to you Im m e d ia te ly t h e r e a fte r f o r payment o f same. (4 ) As s e c u r i t y f o r the Loan, we c o n firm we a re b o ld in g 9 0 0 ,0 0 0 Jam aica Sugar E s ta te s L im ite d Shares i n th e name o f our Nominee Company - Mars Nominees L im it e d . Ve e n clo s e h e re w ith a copy o f t h i s l e t t e r f o r s ig n a t u r e b y y o u r a u th o ris e d s ig n a t o r ie s and r e t u r n i n due c o u rs e , th e re b y C o n tin ued . . . TdcgramKMar*OuMnToicc9303 OWw 17CW»9»Own.Out'-'Numb*. 10201 AiwwMf•!tfceCiowwi PolOmift H^0ncmMH8ammiekiwi«ll^&tN^tD«^(a«KHHwl01Mi floten0 CUphwn. P Ov»Ww. ' Ve*’£a«eulMtOtftetora:H«roUw.EvtnHA ftgMrB.Gwiwmm*.MmiE. 4 I*,flmnw.J.CfcHenLovaJ*r Stctiirf.G*mdC J.McCtackcn. G o m br et te Limited co nf ir mi ng your agreement t o the extension now b e i n g granted. At the same time, perhaps you w o ul d also kindly arrange t o let us have a Board Resolution c o n f i r m i n g the continued borrowing. Yours faithfully, P. O'Dwyer, Loans Officer. B. J. McLoughlin, Authorised Signature. t i Balanca: € 2 7 4 ,7 4 1.7 1 Linit: intaraat Rate: £ 2 7 4 ,7 4 1.7 1 1% Fonda b y Guinnaa* Mahon Cayman Xruat.. A* »acurity for tha t j w i we hava raeaivad a guarantee aignad by Gulanaaa Mabon Cayman Trust. r - GUINNESS ' M A H O N CAYMAN T R U S T LIMITED A Mambar «l U<« >>' :-h '•• ' . ' •;• • . •«-v •. >.• V:-' f.:•!..V■'.••>*'!. '■* '• .'>••1 rr:J: ■■ •: .... :'.:'J ., i :.,* t..*> •;». tc. ••• -Vi:/* ■•• VWV ..leilm&V M " <**/'{ j* » 1i •correagoadaace' with M m R i m , I «ia& to. •©«»;£ir a tha±'.'ifc® Im m w * ba?» baao extended for a ©f oaa 7*33* 'fro SKart eetobesr 1973- at I%* '• ;. ...: ••'■■;:'-V ' ^ ■'' ' ''''.‘ •.' ' V' ..* V • ‘ •’ •”• ’• • • ■ ’ ■-V ..' • . • ■''*7-\#t ‘ ■ V Zfr'&jmrnlatmm ... .... £ 1 2 3 , 8 3 1 . 6 7 : ■' ■ . " ’" ■• • • . «130,CC0.C0 . ••*' , ;' ■ -v=i/ . U ' t f S t e t l T t lat O c t o b e r 1A ;.::X$-3artaT^t 3 ata SvIVfc :'.V<'.’v.. I’i.-.v-’v. ' 91.40l.83 ■ ' 15t e f f e c t i v e lat O c t o b e r .tttef#: 3 1 a t O c t o b e r 1978. • 0323BZSTT3 L I M I T S © • Balance- ' .•'. _ ■ . ■iliait .. . . 'Sfatareat S a t e '. SJaturity D ata £343,746.57 £378, COO. C O 1% e f f e c t i v e lat O c t o b e r Slat O c t o b e r 1978, ■I ha v« a o t r a y i l a d . t o JoJm Co ll l a ' a letter r e g a r d l a g tha •gassjtioa o 2 abarias. IfS. P le aa e let m a ba va ^ o o r i n s t r u c t i o n s s & o a l d y o u wia3a a a to assipI7 . .. . -. ' . . . ,. • . .. • - ...... ' V « ) .............. • > .*■•'• ■v • V • •'?•.‘ V P. 0*I5^ry®r. :r$r' F IL S NOTE: CHRISTOPHER WOODWARD MON RESIDENT LOAN. LIMIT: £ 1 3 5 ,9 0 0 .0 0 TERM: R e v ie w 1 3 t h May 1 9 7 8 . DRAWDOWN: B y w ay o f L o a n A c c o u n t . INTEREST: 9% PROPOSE: S h a r e p u r c h a s e .. SECURITY: "Suitably Secured", . ^*4. SWtfJfc C f i f a * - 1 0 ^ 0 0 3 SImjuO s* u v lSAvn.ttkui feifecuVw.V>-, X k X t/i Per M. C. K. No f a c i l i t y la t t e r is s u e d . Appendix XV (11) Celtic Helicopters Limited 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Celtic Helicopters Limited. a) Celtic Helicopters Limited Credit application. b) Letter o f 27 May 1991 - JD Traynor to IIB. c) Letter of 27 May 1991 - Ansbacher Limited to IIB. d) IIB credit committee application of 28 May 1991. e) Letter of 30 May 1991 - Ansbacher Limited to IIB. f) Letter o f 30 May 1991 - JD Traynor to IIB. g) IIB statement of 19 November 1991. h) Letter of authorisation of 30 May 1991 - Ansbacher Limited to IIB. i) Letter o f authorisation of 30 May 1991 - Ansbacher Limited to IIB. j) Letter o f 30 May 1991 - Celtic Helicopters to IIB. k) Letter o f 31 May 1991 - IIB to Ansbacher Limited. 1) IIB cheques in favour of Guinness and Mahon and Celtic Helicopters of 31 May 1991. m) Cheque in favour of IIB dated 14 September 1991. n) Cheque in favour of IIB dated 1991. o) Letter of 23 January 1992 - Ansbacher Limited to IIB. p) Letter of 7 February 1992 - Ansbacher Limited to IIB. q) Letter of 14 February 1992 - JD Traynor to IIB. r) Letter of 17 February 1992 - JD Traynor to IIB. s) Internal Guinness and Mahon memo re Celtic Helicopters Limited credit application. t) Letter of 5 March 1992 - IIB to Deloitte and Touche. u) IIB internal memo of 6 March 1992. v) Letter o f 9 March 1992 - Ansbacher Limited to IIB. w) Letter o f 9 March 1992 - IIB to Celtic Helicopters Limited. x) Letter o f 10 March 1992 - IIB to Ansbacher Limited. y) Letter o f 11 March 1992 - Haughey Boland Deloitte and Touche to IIB. z) IIB letter of guarantee o f 12 March 1992. aa) IIB internal memo of 27 April 1992. ab) Letter of 16 April 1993 - JD Traynor to IIB. ac) Letter o f 20 April 1993 - JD Traynor to IIB. ad) Letter o f 21 April 1993 - IIB to Celtic Helicopters Limited. ae) IIB facility letter o f 21 April 1993. af) Letter and enclosure of 23 April 1993 - Hamilton Ross Company Limited to IIB. ag) IIB internal memo of 4 May 1993. ah) Letter of 5 May 1993 - IIB to Jet Aviation Business Jets AG. ai) Letter of 8 September 1993 - JD traynor to IIB. C E L T IC H ELIC O PTER S L IM IT E D C R S D IT A P P L IC A T IQ H BACKGROUND C e ltic H e lic o p te rs b u s in e s s . lo a n g u a ra n te e s of is D u b lin IR £ 1 5 0 ,0 0 0 to o f t h e p ro m o t o rs . in itia lly s u p p o rte d T h is a based h e lic o p te r We have been re g u e s t e d t o p r o v id e f a c ility w ill is by re c e iv e a lie n an i n t e r i m th e on th is In a t e n m onth t e r n company s u p p o rt e d a d d it io n g u a ra n te e IR £ 1 5 0 ,0 0 0 o p e ra tin g to of cash t h is by th e s u p p o r t , we Ansbacher d e p o s it e d L im ite d , w ith IIB . s e c u r i t y a rra n g e m e n t w h ic h w i l l be r e p la c e d as so on as p r a c t i c a l l y p o s s ib l e b y t h e g u a ra n te e o f KB Lo n do n s e c u re d b y a c h a rg e on S tg £ 1 7 5 ,0 0 0 d e p o s i t s p la c e d w i t h K B . _F I S M C I M i IN TO RH & TI QH C E L T IC HJiiLiCQFTWRfi t .td — Th e s p re a d s h e e ts sum m arise t h e a c c o u n ts f o r jC e lt ic 1989 1990. th e and 6 m onths s u b s ta n tia l H e lic o p t e rs A tta c h e d a re S e ptem be r in c r e a s e in tu rn o v e r s ix Se ptem be r 1990 re p re s e n ts a P&Ls th e 30 re m a in e d to f o r th e e n d in g p r o f ita b ilit y m onths a u d it e d t r a d i n g IR £ 2 0 ,0 0 0 re la tiv e ly ye a rs on 1990. 31 M arch s ta tic fo r N o t w it h s t a n d in g b etw ee n th e e n d in g and B a la n c e S h e e ts 1989 at show a p r o f i t d e c lin e and f i n a n c i a l and 1990, IR £ 2 8 ,0 0 0 . of same I R £ 5 l,0 0 p e r io d a Th e w h ic h fo r th e 15013 /-o previous year. This is largely attributed to exceptional costs arising in the maintenance of the helicopter fleet. As at September 1990, the financial position of C el tic Helicopters was highly leveraged with borrowings of IR£900,000 and shareholders funds of IR£279,000 of which IR£148,000 was n a d e up of a revaluation in respect of two of t he company's helicopters. PROPOSAL It is proposed that we provide a IR£150,000 cash ba ck ed fac i l i t y to Celtic Helicopters secured by a Sterling deposit in an amount of Stg£175,000. one and as such should we The facility will be a d e m a n d be unhappy with the level of s e c u r i t y cover, we will be in a position to request improved cover. i ASSESSMENT &■gECOMMEKPATIOH As a c as h b acked facility, this is an acceptable proposal and is recommended for approval. Ma. S i o b h a n Lynch, M a a a g a r - B an king, I r i s X I n t e r c o n t i n e n t a l Saak L i m i t e d , 9 1 * M e r r i o n Stp.fare, . DC7BITN 2. '- Re: ; • . ‘ C 5 L T I C H EL IC O P T S R S L I M I T E D ‘ Dear Rlohhan, A t t a c h e ^ heroto: <1 ) Cor-v o f 1 9 9 3*. 1 t-v •■ ‘ cco nnt s foe t h* year ended 31st M a r c h ' (’ 2) ”op y o f V-ar.av^wnfc A cc o u n t s fotf the 6 ^Tenths e n d e d 3 0 t h (3) C e r t i f i e d tr ue copy of t h a ’ le'noran^urj’ and A rt ic le s o f A s s o c iat io n. , . (4 ) S c h e d u l e showing nirector.-), «?ro v i s i o n - e x i s t : N/A Hew Proposed : N/A t-gTATToasTrrP )ate C o n t a c t : 2 8 /3 /9 1 To discuss loan Purpose C o n t a c t : ciliary Business: with : Des Tray n o r Role : consultant to Borrower Deposits N/A M/A DSB2IKB ifith : For DOSS agjaSPN QN-THB.-B0RRQB15S Ratings Rating a g g n q y Short Sasai Long £fiEB C ap . Hirwit'fcv nnwMWit Wfrffcrfli H/A YTSG Miion: U n q u a l i f i e d By: H a u g h e y B o l a n d 6 Co. a a , SHARSaOLDERS Hama Nationality Part . % ciaran Haughey Irish 30 John Barnicle Irish 30 Mars Nominees •o X S C U T I V E SXSCCaRY >urpose: T o s e e k a p p r o v a l f o r loan, [ajor R i s k F a c t o r s : Documentation. Currency fluctuations. fajor S t r o n g P o i n t s : A c c e p t a b l e retu r n given s e curity a nd d e n a n d natu r e of facility. Ve A c c o u n t O f f i c e r : . R e c o m m e n d approval. ASSOCIATES tD I R E C T O R DECISION OF IIB CREDIT COMMITTEE: — p ve d tavs App. No: £DCff. DIRECTOR u / .t• ■v,"* if ■-> *■* & * H S 0A t..6* U l r t l U » - " f c / 0 CORPORATE SER VICES .•V* • * £ STATEMENT CHW */Cl' 02/02115/77 nUSK nmmCONTINEKTAI. BANK LTD. •IMoiimSqum rvrn-2 Tdcphoar (01)6I9M4 Tain: 53333 taoiflillc (0I)7I?034 OfcP Olil VTATUMNTOAHi if.SBACHftH LlrtlTEO ' c /u co ^ obatb ssrvjcss *®M *** 19H0VV1 PA66 HOt 001 VMM DAT! OfTMS DAT! •• S1MAV91 DROUIi HT FlHU<*R» JV 1U667* H6U ci» HATt 1 1 .2 5 * LOBGEflElir 30 JU HV1 INTERE ST TU 3UJUM91 3UK*Y91 30JUN91 I MUMt ------ U.V1C cmmt 173/UUU.Ou 1*672.UV 175»UUU.0U 1 7 6 * 6 / 2 . UV j? i .lii ' ;j. :•-! OVMOHAWNIALAKCII M l MAMIOO OP IN T H IV IN T a U fW IS f U A l f W M TI ro QUA IN TH N A l A u c r r DIPAftTMINT. A i i S U A C h EH PIMMIMlalit*'M*«M l»lll«l* t st^ch li a b i l i t y may be c u r r e n t , ■^o h o l d a l l m o n e y s vlvi^n n o w o r h e r e a f t e r ma y stand to o u r c r e d i t v Deposit Account Wc ...... , _ jrrency a s b e i n g a v a i l a b l e a s s e c u r i t y ,f o r a l l sich l i a b i l i t i e s a s a f o r e a e n t io n a d . F u r t h e r m o r e y ou a r e authoP l^ ed— fre*-Set o f f an d apjjly sach m o n e y s o r a n y p a r t t he r e o f , f r o m time to time in o r towards- s a t i s f a c t i o n o f s u c h l i a b i l i t i e s e n t i r e l y at yo ur o w n d i s c r e t i o n w i t h out f u r t h e r n o t i c e a n d such set o f f w i l l b e a g o o d a n d valid; di scharge of. s u c h a o n e y a so applied" w i t h o u t a n y f u r t h e r e n d o r s e m e n t o r a u t h o r i s a t i o n yhatscevar. . * \ \ D at e d thi^s 30 th d a y o f M a y ? 991 Signed: F o r and on be half of A N 3 B LIMITED, J D T /A JTA \ 14003 r> Ansbacher Limited A Mimbtr of (he Henry Ansbacher Holdings PLC M erchant Banking Group P.O. 3ox 287. Grand Cayman. British Wert Indies Phone: (809) 949-1633/ 4 Telex- CP 4305 Fax: (809) 949-7946 (809) 949-5267 To: Irish Intercontinental Bank Limited, 91 Merrion Square, DUBLIN 2. We hereby authorise and empower you pending payment of any Bills, Notes, Overdrafts, Loans, Guarantees or other contingencies in respect of which we may be liable to you either directly, jointly with others, as collateral for a third party or in any other manner whatsoever, and notwithstanding that such liability may be current, to hold all moneys which now or hereafter may stand to our credit on Deposit Account No. 0Q.” O3®LV5 or otherwise and in whatever currency as being available as security for all such liabilities as aforementioned. Furthermore you are authorised to set off and apply such moneys or any part thereof, from time to time ir) or towards satisfaction of such liabilities entirely at your own discretion without further notice and such set off will be a good and valid discharge of such moneys so applied without any further endorsement or authorisation whatsoever. Dated this 30th day of May 1991 Signed: For and oi i ,IMITED ry Dublin Airport Ireland Telephone 379900 Ext 4722 423386 or 967011 (24hr Paging) Siobhan Irish 91, Lynch, International Merrion Dublin Further 1991 to cheques, Bank, Square, 2. 3 0 t h May, ) Bank, documentation one and for the sen t £100,000.00 second for to you e a r l y w ade payable £50,000.00 today p le a a e to made Guinrtess issue and payable ^ t o two m ahon • . •• C eltic H elicopters. Signed: J o h n T. C i a r a n G. H a u g h e y Barnicle Director — i IiAOO^:. °(0O6} »fti. I T llamUU ^ ft UmmAmi P CmrtSt M. 0*KaHv. V.A.T. No.473it3Q1. ' * • rv IHISH IMrttCONTIMCNTAL l* W I SL/EA. "* 31 M a y 1991 Ms Joan Williams, Ansbacher L t d . , c/o 42 Fitzwilliam Square, Dublin 2. /•"N Rar C eltic Helicopters '.. v : Dear Joan, . I enclose a cheque for I E P 1 0 0 , 0 0 0 payable t o Guinness & Mahon Limited and for IEP50,000 payable to Celtic Helicopters Limited in accordance with the drawdown request from Celtic Helicopters Limited. Yours sincerely, £ * C $ \0 .,fV SIOBHAN LYNCH Manager - Banking. ; MSH INTUCOhmNlNTAL BANKlIMfTID • *1 MCMION SC&1AU. DUftUN X • TCUTHONK. 01 *1*744 • fACSIMIUU01 7SSOX4 • TtUOL M U fttClSTCIUOINTHtRtrilftUCOf mtkANB NUMftCI40*JT A SUMIOIARV OP RUOKTIANK N.V. Irish Intercontinental Bank Ltd. 9T MZRRI QN SQUARE, DUBLIN 1. Allied Irish Banks pic ' 3 COLLEGE STREET, DUBLIN 2. OATS aasoi 1 T*«ia# /-s. 'TajO PAV TO THE OftOEN OP CHSOUS NO. H-^Uc.0 C rU iA jiO tJS S AMOUNT Qf POUNDS IN WO^OS Thou«*/*as j NunO'Wi 1 T«m 2.>3/Z>Ci 2 a€e • Ji-aec mount loo, a © c ; cvr .0AM • Un ri LTC ImSC f>6NCK AS IN FIGURES I ~ u .& .(Jfs q3«33B*«i: e ^ s o s t * oe 93 - 33 - 8- V/O Irish Intercontinental Bank Ltd. 91 MERRION SaUAR E, DUBLIN 2. (X) Allied Irish Banks pic 0 ——. > « i» k STREET. • ev m i n i m *2. > 5# COLLEGE DUBLIN OATE sils’tan 3.1&OX AMOUNT PAY TO THE ORDER OP . CHEQUE NO. C*J.TIC- h « jli ' ■ ” AMOUNT O f POUNOS IN »VO»OS T#"» K u na't dt T«ns a* Thousands TKQuur*0t •ZJgQ p e n c e a s in R-C co ^ ?* ax _ • P i GU"S S #>a2 3a0 2»a t33»'3 3BM: o c t7 U« tl j'la n t s &o s e e * INTEdCONTINfNTA L SAN / / / / -n x . 21.0 7 3D 56H" 0 2 AulHOMMtf Ingr*4to**» minim) .. 3 '■ i f:-rr **, ■' VW & - ■ ? r :- v C x ;£ m - '- "• < ,• ' •/' <" Jjf* r-'-y. -■ vv>: V:-'. ' ' O S fs& s S' ?J'{. »•v;• ’ oujun am pour M47-M wotAJto ^ ^BginKt^lr®land. or'vCs7<''^':T *•••*•’ £>*«*‘* k'V'lte'ift! * M v 4^»;?Br'-i‘>? •• >-:/:• }ph':X ^ •?V;K ^ y .r? , '* '*> ' ■"■ •ji‘ -■:.,!lU.»tL •.>•••* ?..*•. at-or-a D u a i u t A j n « = c ,r r u u l a m o ' '_vj•'••^• _________ 12 2 * BanxtFlraiiaoa ?Y/ \C U S V v \< v S tL ^ C ^ W > ^ r > m f l ‘g y x ’?N, or ord'sr . .3, .--P o4.qu $41wa no ?am 16? 148' 9?5 $5.0 .p 923'0)" 'I-t "ts-ti Jiu-pw?t l5l1l?' ?lab - c331 . -. . - .. . . I wru- ?nal"! an mp, ants. ?:1.le I ?r 2 no can 'I-m?w-w H51 . . savanna: 20 warn-[aw . no: Impact. mun ?on on ?mm'vum?lw?-fsu? 9 . 1. .1 . warn" - .- 12! 21771? xuea u" . .1: a 1. w" tar-two(cad eve-m (m ?Tr-w such: r-L . . . IF: ems-am: w. law: ran-1'3? wt '04 35!er :1 :5?apq*?_ .4. .- r-q- . h?l} I I ?hlirgw. ( j y (J u jS Please repiy \j: 42 Flirwiiliara Squarc, Dublin 2. Td: 7 65144/752C65 Fas: 612035 Ansbacher Limited P.O. Box 337, Grand Cayman, Cayman Islands, British West Indies Tilephono: (309) 949-3655 Telex: CP 4305 Facsimile (309) 949-7946 (309) 949-5267 ’ 7 t h F e b r u a r y , 1992. G a r r e t t L o g a n , E s q. / Irish Intercontinental Bank Limited/ 91 M e r x i o n S q u a r e , . D U B L I N 2. \ " Dear Garrett, I w o u l d b e g r a t e f u l if y o u c o u l d a r r a n g e t o let m e h a v e t h r e e Irish Pounds Drafts for collection first thing on Wednesday next, 12th February, E a c h Draft shouia be payable to the B a n k o f I r e l a n d , o n e f o r IR£1 Q.0,0 00 . 0 0 , t h e s e c o n d for I R £ 5 0 , 0 0 0 . 0 0 a n d t h e t h i r d f o r E R £ 3 ,819.69. tt s h o u l d b e d e b i t e d t o A n s b a c h e r L i m i t e d T h e t o t a l S t e r line A c c o u n t Mo, Yours sincerelyv AU210J3 at .in tCCA'RSO B1 “1 3 3 3AHAUA3.331X03VBOPj ISLmE3. OUjEQfflSY. UCNACO ASD JWnZZ2tAttD wrrao m a 1 Obi Appendix Ms. Slobhan lynch, Manager - Ban'eia'?, ;; IrtsH Intercontinental B a n k Limited, 91 ‘ lerrion Square, mrPl TW 2. rtear Siobhan, >s arranges*, herawith ^.raf t for credit to Celtic '■feULcoptarn Account. . . f I wuMlc’ap'pronliic* if yop caul* Lot .no '■'irb in ■ *.*ie cou rs e a co.!" of f'c rle--. *.i>j ° *■ .. ".any ♦:Na-*\s for yonr No1. **. j Yours sincerely, ' \ J.P. Traynor. x JT>T/A JW \HObG i / Ms. Slohhan lynch, ’*anagar - Sinking, ■ Trish Intercontinental Barite Limited, 91 Merrion Square, D'JBI-IH 2. qe: 17th ? s b r u a r y , 1992 Celtic ^eltcoptega '"'ear ?tobhanr j . ' '•virther to letter 1^tv* *,at>r,,.ary with vhich t nncloso-* ’raft for IP.E153,M*. H , J enclose herewith cash anounttng to ^.40 bei-vj tho waV'-.op-'! Interest incuni:* J.D. Traynor jdt7 njh t Appendixxvmu) •r. r r. :: o y r r>fl T.rrrra r»cis/ric») a?-=t jc a t io h r?rraoocci!io« . ■ Tha purpose of this r sport is to seek approval to provide a one yaar I2?l00k guarantee facility to Celtic. The facility will be used to iss’ia 2 guarantee in favour of Bank of Ireland and will be secured by tiie guarantee of Ansbacher Limited, supported by a lien on cask deposits of GBP125X placed with IIB* The borrower may request us to accept as alternative security, the guarantee of XB London, supported by a charge on deposits of G3?125k, placed with X3 London. In 1991 we advanced an I3P1S0JC loan facility to Celtic which was repaid in February 1 9 9 2 . • n m a c o L J Ra s n a a Audited accounts for the two years ended March 1990 together with management accounts for the six months to September 1990 are attached. Wa have regimes ted updated financial information from the company. Performance for the six months to September 1990 .showed a significant improvement with profits of IEF34X as compared with the latter half of '39/'90 whan a loss of IEPS 71c was incurred. The balance sheet as ^t'- September 1990 is highly geared vith borrowings (including finance leases) of IEP902k as compared with equity of IEP273X (of which IEP14Sk is accounted for by revaluation reserves relating to the helicopters). PRPEQSftL We would consider the facility (which is a demand facility) to be adequately secured by the guarantee of Ansbacher together with tha cash* deposit of GBP1253c. Given tha cash backed nature of tha facility, approval of the above is recommended. J 5 Ma r c h 1992 PN/ES Hr. Paul Carty, Deloitte & Touche, Deloitte House, Earlsfort Terrace, Dublin 2. Rs; P r o p o sed Guar an tee F a c i l i t y - Ce l t i c H a l i C Q P t a r s Ltd. Dear Hr. Carty, .i,v I enclose a form of guarantee w h i c h w e w o u l d p r o p o s e t o issue in favour of Bank of I r e l a n d in r el a t i o n t o t h e above. '* I should point out t h a t t h e a v a i l a b i l i t y of t h e p r o p o s e d facility is currently the s u b j e c t of a c re di t a p p l i c a t i o n and its availability is subject to approval. - -«■ Yours sincerely, .7#* * Banking Executive IRISHINTlRCONTINLNTAt. BANKUMTTtO • »1MCMIONSQUAM.DUMJN2 • TtUFHONt. 01 4197**•FACSIMILE.01 7»SOi4 . 1UU Hill A l C l l T l l U O IN T M I R tP U fttlC Of I M U N O N U M I I A 40SS7 . ... KB : Acc.Jiater: Date: Xezt ISTiev date: IIB C. HC1\H Ser: 6355 6 KAJtCH '92 31 mica '92 mm\s) BOJaOflEt(S): 1UJZ: axnaiT: m s: FS0F32>: 1. CELTIC ELICOPTEJS LTD. ("CELTIC) 3. m . HUE a ir CELTIC HELIC0FTE2S LTD sim Dublin Airport Ireland Private Crapany CCD3T2T lzgal sixras am asixs . G2C0P 0THK2 mctoto? BUSQESS U3S e n FIGOKES in 110 BEF BOnam Date:Hgit Acs 6 Itbs 09/X T3H: 15.3a TC»: 15.31 Total Assets: 77l Sales: 22a Curr.Casb PI: 3.ta 1991 Celtic Helicopters Bank of Ireland CDUARDK Date: CM: Helicopter operator Total Assets: Sales: Curr.Casb FI: M/A tam HACK CCDS : € Excbanqe Bate : BZF55 > IEP1 BEI CSEDITLIHES 13 HATIOHAL C0ME8CT OF 22F08TIHC OUT: HS OOTSTAHDIHG G1AJTED/ APPROVED L REQUESTED 5,550 ' IX: TBD HAIQIE 1BQ0EST C 0 DESCBimOH OF THE m m lu es ahd lm ts fey C Cash backed IEPlOOk guarantee fa c ility HAimm D in Deiand fa c ility T - - 5,500 GSCOP SISK: 5,500 30/6/93 rs r iraPBfflRITlHS and SUBPATCTICIPATIQHS specific g gPvnrcMT h c h s d o l e N/A M/A ; *» *• GO X R A M T E S S and COLLATERAL Type Aaount Value 1. Guarantee of Ansbacher Ltd. supported b y 2. L i e n on GBP10d,000 cash deposit with IIB. raiSTTMG S’ ECTTRITY MSVTgWBD AMD 1 M O RD E R I Status Proposed H/A 1 TSRHS- a n d CONDITIONS 31 N/A M/ a FBZS F e e Type Calc.Keth. period 1% Ant of facility Payable annually in advance Optional Currencies Drawing Scheae iAvailability Period P u t Options ' Tax - w h t • Law s : : s : s No ~i As set out —1 N/A T a x Credit s N/A Irish Jurisdiction ; Irish PR Pf IT A S IIiIT t U s a g e of the line: - Capital Adequacy Ratio: 20* Nil weighting on used portion weighting on unused portion Application field T a x Cla us e : N/A Mijiimum M a r g i n Effective Margin (incl. faes) R e t u r n on e q u i t y As set out ; 1 no dr aw dow n - 504 d r a w d o w n - 10 0 % dr aw d o w n N/A R e t u r n o n c om m i t t e d amounts no drawdown - 50% d r a w d o w n - 100% d ra w d o w n Int e r e s t Booking: N / A I n t e r e s t Status: N/A Classification : Lo w r isk Provision-exist: Nil N e w P rop os ed Nil TOATIQiTSHIP M a r c h 1992 With : Des T r a y n o r P u r p o s e Contact: This pr op os al Bole : Consultant to Borrower A n c i l l a r y Business: Deposits Date Contact : SLfflBAL PROFITABILITY N/A IND I R E C T N/A JP iy iQ N .1 QM■xtjlLdBOBI N/A AUDITING M a r c h 1990 Opinion: U nq ualified By: H a u g h e y Bo la nd 6 Co. MAIN SHAREHOLDERS Name Nationality Part. % Cia ra n H a u g h e y J o h n Barnic le Mars Nominees Irish Irish Irish 30 30 40 SUMMARY sek approval to provide a on e y e a r -lEPlQOk ca sh b&clced g ua r a n t e e Lity. c Factors: None. >ng Points: Cash b a c k e d facility. Documentation has b e e n a pp rov ed b y XIB's solicitors (July 1991). lount Officer: i the c a s h ba c k e d nature o f the facility, approval is mended. APPROVED DI RE CT OR e d ie tb an k for o n : N / A DIRECTOR Pli3j2 rsply to: 42 Fi^rviiliaai Squart D ublm l Tel: 75il44/763C65 Fax: 612035 P.O. Box 337, Grand Cayman, Cayman Islands. British West Telephone: (809) 949-8655 Telex: CP 4305 Facsimile (809) 949-7946 (809) 949-5267 9th March, 1992. Ms. Siobhan Lynch, M a n a g e r - Banking, Iri s h Intercontinental Bank Limited, 91 Merri on Square, D U B L I N 2. Ra: ' Celtic Helicopters Ltd. De ar Siobhan, . I w i s h to confirm having spoken to Paul Na.essans on Thursday last asking him to speak to you about arranging that I.I.B. would g i v e a Guarantee to the Bank of Ireland in the sum of I R E 1 00,000 in connection with Celtic Helicopters Limited. T h e facility would be for a, 1 §^jig n t h ' p e riod to be given to the Ba nk of Ireland, Dublin Air^Srt B r a n ^ h r ^ - ^ The Manager there is M r . Gerry Duffy and he has been given a copy of your ordinary Gu a r a n t e e and indicates that it would be suitable for him. I I w ou l d ba grateful if you could push ahead with getting approval a nd if you get approval please deal with Mr. Duffy directly. If y ou have any problems, please telephone me. You rs sincerely, ' J.D. Traynor. JDT/AJW No . ^ ,'rt >1 ** J A>> A. \mOSR OFTHEA > S 3 A C m W T S W A T J0 N A I.T a U S T 0 J K > U P O f COMPANIES OTTO O m C S J AL20ICCATESCtTHZBAHAH.V3. BiirnSHVIRGINISLANDS, CUX3HSSY. M ONACO AND SW ITZERLAND a nail H1 xx -- -- o . .\\ CG/AS/6353 • 9 , 1 99 2 C e l t i c Helicopters Limited, 43-49, Mespil Road, Dublin 4 D e a r Sirs, W e a r e ple as ed t o c o n f i r m tha "willingness of Irish In te rc on t i n e n t a l B a n k L i m i t ad (aI I 3 M ) t o m a k e t h e f o l l o w i n g f a c i l i t y available t o C eltic H e l i c o p t e r s Limited, ( " th e Borrower") s u b je ct t o tha fo l l o w i n g terms a nd conditions. l. Aaocrcr AHp.icwraRg o r J s a c x i Z E Z . i A facility in an a mo u n t o f I2?100 ,0 00 (one h u n d r e d thousand Irish pounds) to p r o v i d e a guarantee i n a f o r m acceptable to IIB in f a v o u r of Th e G ov ernor a n d C o m p a n y o f tha Ba nk Of I r e l a n d ( tha "BOI Guarantee") i n r e s p e c t o f loan f acilities p r o v i d e d to the Borrower. 2 . gpsfigssirem ; Th e Borrower w i l l p a y t o IIB a g u a ra nt ee c o m m i s s i o n of 1% per annum o n th e a m o u n t of the guarantee in a d v a n c e of the issue b y IIB of tha BOX Guarantee. 3. RB P A r a a r o S ho ul d IIB be r e q u i r e d t o p a y any s u m on foot o f t h i s facility, t he B o r r o w e r w i l l re i m b u r s e such s u m t o IIB f o r value on t h e s am e d a y as IIB shall have m a d e s u c h payment. In the even t of any su ch p a ym en t due t o I I B un d e r this or any o t he r cl a u s a of this agreement n o t be i n g made on tha d u a date, t h a B o r r o w e r will p a y s u c h amount toget her w i t h i n t e r e s t t h e r e o n a t IIB's P r i m e R a t e plus 1% f r o m tim a to t i m e c a l c u l a t e d f ro m t h e d a y o n which IIB shall ha va m a d a such paym en t (or, as t h e case may be, t h e a m o u n t s h all ha ve become due b y t h e Borrower to IIB) u n ti l the d a t e of reimbursement, subject t o q u a r t e r l y rests. $6ool IWSHINTLftCONnNCNTA!*BANKLIMITED• MEJUUON5C.UAM,DUIHJNZ• TtUfMONl. Ol 6J97*4•FACSlMiU.01 7MOM*tlUX. M3Z2 X C C I S T IU D IN T M t XL7 U 3 LIC Of I U U N D a A u a s io iA t t v o t X U M 1 U 40997 n .v . W i t h o u t prajudice to IIB's r i g h t to te r m i n a t e th is fa ci l i t y on d amand at any t i n e t hi s fa ci li ty is s u b j e c t to ra vi av on 30 J u n e 1993 a n d will b e c an c e l l e d o n t h a t data, uniass o therwise e x t e n d e d in w r i t i n g b y IIB. SBCPKTirt. A n y and all indebtedness o r l i a b i l i t y o f the B o r r o w e r to IIB is to b e sec ur ed b y s u c h s e c u r i t y in s u c h f o r a as shall be re qu ir ed b y I IB at its absolute d i s c r e t i o n f r o m time to time. In co ns id eration of IIB p r o v i d i n g t h e BOI Guarantee, th e Borrower h e r e b y u n d e r t a k e s an d agrees as follows: (i) T o indemnify IIB a g a i n s t all actions, p r o c e e d i n g s , damages, costs, claims, exp en s e s or l osses w h i c h 113 may s u f f e r o r s u s t a i n b y r e a s o n of o r on account of I I B h av i n g g i v e n th e BOI Guarantee; (ii) T h a t the Bo rr ow er' s l i a b i l i t y h e r e u n d e r s h al l continue u nt i l IIB's l i a b i l i t y ei th er a c t u a l o r contingent u n d er th e B O X G u a r a n t e e shall b e extinguished and u n t i l all sums due h e r e u n d e r shall have b e a n d is ch a r g e d ; (iii)That an y r e q u e s t m a d e u p o n I IB fo r p a y m e n t o f a n y s u m of m o n e y un d e r t h e BOI G u a r a n t e e shall b e a sufficient a ut h o r i t y t o IIB, w i t h o u t a n y n o t i c e t o or consent fr om t he B o r r o w e r f o r ma k i n g a n y s u c h ■payment and i t shall n o t b e incumbent u p o n I I B t o enquire w h e t h e r any s u c h p a y m e n t is in f a c t due; (iv) On demand pa y to IIB a ll a m o u nt s paid b y IIB, as conclusively d e t e r m i n e d b y IIB, t o meet a n y a n d all such pa ym en ts m a d e b y I I B u n d e r or in r e s p e c t of tha BOI Guarantee. Without prejudice t o 1 1 3 's right to tarainata this f a c i l i t y o.i damand at any tima 113 shall be entitled to cancal it's facility heraunder and to require tha aorro'./ar co placs and maintain sufficient funds on dacosii vith*IXB to meat all its obligations u n d er the 301 G u a r x n t a a froia tiaa to time including interest, comais-s ion and othar char gas should any of tha events da-tailsd in clausa 9 of 113's Standard Taras and Conditions attached hereto, occur or should any s-acurity provided f or this Facility tarainata or b ec ome illagal or unanforcaabla for any raason w h a t s o e v e r . jn c sre re c a .-* ggm a e n B • If for tha purposes of obtaining judgment in a n y cou rt it is necessary to convart a sum dua hereunder in on* cnrrancy {in this clausa called tha "first currency*) into another currency (in this clause called tha "second curr anc y* ) t h e rata of exchange which shall b e applied shall 3ba that at which in accordance w i t h tha normal banking p r o c e d u r e s , 1 1 3 could purchase tha first currency with tha second currency on the business d a y preceding that on which final, judgment is giv en a n d t he Borrower's obligation in respect of any such sums d u e froia it to 113 ha reundar shall notwithstanding any judgment in tbs second currency, ba discharged o n l y t o tha extent that on tha business day following receipt by 1 1 3 of any su m adjudg&d to be due hereunder in t h a sacond currancy IIB m a y in accordance with normal banking prccaduras purchase the first currancy w i t h th a sacond currancy. If the first currancy so purc ha se d falls .short of t h e s um originally due to IXB in tha first currancy tha Borrower agrees that it shall as a saparat* obligation a nd notwithstanding any such judgment indemnify IIB against such shortfall. s ra m ia p m s asro c o n d it io n s : Tha facility is subject to IIB's Standard Terms and Conditions which are attached harato and which form part of this Fa cility Letter. 10 • a c c w r e y * r>T o y r a a t T h U o f f e r w i l l lapse o n 24 th M a r c h 1992. T o a c c e p t tiUa o f f e r o n t h e ab o v e t erms and c o n d i t i o n s Pl « a s e r e t u r n t h e following: . • (i ) t h e e ncl o s e d d u p l i c a t e of t hi s l e t t e r d u l y acce pt ed ; (b) t h e a t t a c h e d f o r m f o r t he o p e n i n g o f a c c o u n t s ; a n d (o) a c h e q u e f o r IE P1 ,2 50 in p a y m e n t o f t h e g u a r a n t e e co mm i s s i o n . Yours faithfully/ P o r a n d o n behalf of I r i s h Intercontinental B a n k L i m i t e d Manager - Banking u% ? nn the above terms and conditions for and on behalf of CELTIC AppendixXV?lHil?) I - IRISH INTtftCOMTININTAl IAMK 10 M a r c h 1992 SL/ES Mr. Des Traynor, Ansb ac he r Ltd., 42 Fitzwilliam Square, Dublin 2. Ra: Celtic Helicopters Liaitfld . D e a r Des, I enclose a Facility L e t t e r f o r the IEP100,000 g uarantee facility in duplicate t o g e t h e r with an accou nt open in g f o n t to b e executed by c eltic Helicopters Limited. K i n d regards. Yours sincerely, ; „ rr SIOB HA N LYNCH Mana ge r IMSHIMTCJlCOMnMCNTAl. • UMffCD• 91 MCMIONSQpAftfc. DUBUN2 • TlUmONC.OI *1*7+4. flACMMUU.Ol NSOM•JtLMJL aiei*r**«o in thcmpuiuc or iu<.am numkr msi? a suasioiAftv or kuoiitiahi n.v. Haughey B o 'n id Deloitte & Touche Deloitte & Touch* House EarlsfortTerrace Dublin 2 Telephone: (01) 75 44 33 Facsimile: (01)7566 22 Chartered Accountants A Your Raf Our Ref PPC/AC Ms. S i o b h a n Ly nc h, Manager - Banking Irish Intercontinental Bank 91 M e r r i o n Square D u b l i n 2. D e a r MS. Lynch/ 11th Ma r c h 1992 Res C e l t i c H s l i o o p t s r s ..L t d < I r e f e r to your facility letter of 9th March 1992 addressed to the a bove company. .. I n o w r e t u r n herewith, as requ e s t e d : 1. Duplicate of facility letter, duly signed. 2. Letter of application for the opening of accounts, d ul y • signed. t 3. C heque for £1,250 in p a y m e n t of the guarantee commission. ’ ■ I t r u s t this now resolves th e matter. Should you require any further information please do not h e s i t a t e t o c o n t a c t me. Yours sincerely, ■ & P. P. Ca: PJ Barton FW Bowan PG Sutler P8 8yme PJ Carr PP Cirty P Cullen OB Oeasy CA O a n n a h y 't^ lfe ffiffiA j^ jy fD o n o v a n B Gaffney JP Gilmarlin JM Hayden JJ Xeenan P Kenny G Lyon* R MacOarhy J McAvoy BP MeOonlW-CH JA McLaughlin GV Magee 0 Murray RJ Nolan PJ Nunan C O’Carroll TR OFarrall TG O'Rourke JS Plttock 8F Scanned MM Smith BO Unlack* Consultants: H Boland TP Butler 0 0 ‘Hegarty Also at Cork & Limerick Authorised by tha Institute ol Chartered Accountants in Ireland to carry on investment business in the United Kingdom. Member O R I International lo o /c . fc .v , v . > C&f?/* • ® f - . tVv v ^ r r 3 - S d a triih U __________ 1^L________ :---------- day a f _ ferch _ •$? '<• : \v nine hundr-sd and nine,i:Y~j.-.!££--------------—-------------------------------------------- - between _________I ~i3h I n t a r c o n t in e n t a l Baric L im ited ----------------------------------------- (Name) i S t r x f e P k , . - ____ _________ i l -ia £ E L CT_a p a T e i Cllfrllfl 2 , --------------------------------------------------- (Address) —---------------------------------------------------------------------------------------------------------------------- (Name) -------------------------------------------------------------------------------------------- -——---------------------- (Address) (Name) . '.{•' o f ------------------------------------------------------------------------------------------------------------------------ ' Jk. ' *&!■ ’ “ (Address) (haraii-safcar called “tha Guarantors* which expression shall include their executors administrators iucc3330T3 ot assigns) andThe Governor and Company offche Bank oflreland (hereinafter called "the Bank” •,vhkh jrcrassion jhaD include ita successors or assigns). V/her.jas l-.ha Guar an to rs h ava raqu astad an d thaBankhas agreed to grant and/or continue accommodation w € • So -_____________C e l t i c J fe llc o u ta r a Trtnri i ;: v>*•’• ____________________________________ ___ (Name) 4 3 /4 9 M asp il Road, D u b lin 4 ■ o f ................... ...................................................................................... ....................—-— .................. . (Address) {heralnaftar called “the Customer") upon the Guarantors executing a Guarantee in favour of the Bank on kna terms and conditions havainaftar appearing. Now tliara/ora it is hereby agraed and declared as follows:1. In consideration of the Bank making or continuing advances or otherwise giving credit or affording banking facilities to tha Customer, for as long as the Bank may think fit, the Guarantors agree to pay to the 3anlc on d’i m andall sums of money (hereinafter called the "ultimate balance") which are now or shall at any tim aba owin".rr remain unpaid to the Bank any wh ere from or by the Customer whether as principal or surety an dwhather solsly orjointly with any other party or from any firm in which the Customer may be a partner, upon ■;ur.*-»nt overdraft accounts, promissory notes or bill 3 discounted or paid and other loans, credits, leases, indemni ties or advances made to or for the accommodation or at the request of the Customer solely or jointly or of any such firm 33 aforesaid whether for actual or contingent liability or any liability in connection with ioraign *:cch ange transactions or on foot of any Guaran tees, Indemnities or on any oth er account whatsoever togathjr with in all the eases aforesaid, all interest, discount and other bankers’ charges including legal charges occasioned by or incident to this or any other security held by or offered to the Bank for the ultimate balance urby or to the enforcement of any such security (all such monies beinghereinafter referred to as “the Customer's ii abilities") PROVIDED ALWAYS that the total amount ultimately enforceable against the Guar antorj under this guarantee shall not exceed the principal amount set out below and to the extent they ralatd to such principal the following additional amounts:- (a) all unpaid interest accrued and payable in respect of the Customer’s liabilities; M tn is ;!)) ^ L 2 3 A L Ji S5CU5UTY F03RIH3 ^O CO t Co) all in v a s io n theCu'-j:.:..- :.- j liabiliti-airas *data afdamsnd under or earlier determination ofUiis guarantee until payrasr.: atad iltha "a ~ and in the .ranner applicable to the relative account of tha Customer (c) all unpaid commission, fj ij, :ha,-jea (in :iu.:inj lagal charges) ind expenses payable in respect of the Customer's liabilities; a.i.i . . (d) all additional amount; :u : rntain plated by Condition V of paragraph 2 hereof The principal amount referred to x:ova ix Amount ___________1 0 0 ,CCO Currency _______________ Triah Pounds one hundrad thousand Irish Pounds) 2. Thi3 g u a ra n te e ^ subject to the (arms and condi tiono hereinafter set forth. The tenna and coad ition j h-eraiabe/ore referred loi A. ■ Unless the contraiy intention appears, words in tha plural shall include the singular. £. The agreements and obligation.* on tha part of the Guarantors herein contained shall take effect aa joint and several agreements and obligations and references to the Guarantors shall take effect as references to each of them and none of them shall be released from liability hereunder by reason of the guarantee ceasing to be binding aa a continuing security on any other 6f them. C. This guarantee shall be in addition to andnotin substitution for any other guarantee for the Customer given to tha Bank by the Guarantors. D. This guarantee shall be in addi ticn to and shall notfce in any way prejudiced or affected by any collateral or other security now or hereafter n aid by the Bank for all or any part of the liabilities hereby guaranteed. E. Although the ultimate liability of the Guarantors under this guarantee is not to exceed the limit hereinbefore specified, yet this guarantee shall be construed and take effect as a guarantee for the whole and every part of the ultimata balance owingby tha Customer to the Bank and unless and until such balanee has been paid in full by the Guarantors the Guarantors shall not be entitled to share in any security held by the Bank on account of that balance or to stand in the place of the Bankin respect of any security or money nor until such balance has been paid in full shall the Guarantors take any steps to enforce any right or claim against the Customer in respect of any monies paid by the Guarantors to the Bank hereunder or have or exercise any rights as surely in competition with the Bank. F. For the purpose of enabling tha Bank to sue the Customer or prove against his estate for the whole of the ultimata balance or to preserve intact tha liability of any other party, the Bank may at any time place and keep for such time as it may think prudent any money received, recovered or realised hereunder on one or more separata or suspense accounts to the credit either of the Guarantors or of such other party as it shall think fit without any intermediate obligation on the part of the Bank to apply the same or any part thereof in or towards the discharge of tha ultimata balance owing as aforesaid and without any intermediate right on the part of the Guarantors to sue the Customer or prove in the bankruptcy, insolvency or winding-up of the Customer in competition with the Bank or so as to diminish any dividend or other advantage that would or might come to the Bank or so as to. treat the liability of the Customer as diminished. . G. All monies received by the Sank from the Guarantors or the Customer or any other party liable to pay the same may be applied by tha Bank to any account or item of account or to any transaction to which the same may be applicable. a- >r..z ’/Vic". : i.-.-' zir. : :o :;v;.' rr :.7'. yv. . 74-m 'm I KStf* «838 i ! )T J.:=our.u . ■;•.: i ••: : • : :i u :ar*jn any ' r ■■ riiate carmen; or satisfaction of the ■.. - • : . •; r. v.ey v'vv.j oj ifv n s j:-: y~'- ;' ai! -a -i ccTiinuing security and •. • }•/ ihJil .V i ■*-:*ing consiicat* tha balance due .. : 3i.i>. :;cii my suihaMOUiv.i wsu/.is aj i'")r2said and so that where ^ V i :f tn»liability ifih JGuar ir, n , * s 3an;? may select tha particular : i '■ 2i .‘-v jiA id u jecurad by v..i iVira.Kes. ; w I sc.isinuin j security on the Guarantors, and in the event of death Thu jcj.nniun ; : :e li-ninutnMKJ'and on hii estate, until tha expiration of one of my of Mi•» C-jarx'. ■ . ”* !i j > G-jra.-.tors. :.whaling in theoaae of -isath, all ** executors or administrators calendar monln a;>.j.' gjv >n la tha Bank nodes in writing to discontinue and of ch.j of tba ■ ■ !; . i : G ran tor ^ determine it J. In the want of*-'.: 1 4'-.arsnt.-.4 53 win? :>ani any causa whatooev1: to be binding 33 a continuing security an the Guarantor,, thiiv u jn -yrt i l/nir.ista-nton ov any of tham:- 61) ^av-mani, bilb, notM and negotiable instruments or securities drawn, al! cheques, or.: ir jt.a -i bv mada, endorasti . or for the account of th* Cu3t: mer on the Bank or its agents and purporting to fc* .1 ;J on or fee/ora ihs data whan the guarantee eaa*wiobe a continuing security CUu ctijocnuinuancL! although pr« anted to or paid by tha Bank arils agents after the discontinuance data Mil fo) all liaoiiifciaa of , Jr.jiamrs to lha3dn> it tha dismntinunncs clita wb.jthar cartain or contingent or v/hathsrpayabl;''..r.vifch )»' it jom^ fur.ur-3 Kmaor '.i.nas anti a)jo all iir’dite than established by the Bank for tha CaslosHr shallramainpayableby *hi Guarantors»Vr.UaW ^i.ttader thia guarantee ciia;>-h-,i:'a_not taV.an and wilt not take from the Customer, sichar directly or indirectly,without tha consent of tha Bank, x ^ n c iis , bill s of exchange, mortgag:-, char* s oroth ;r security whether merely persona! or inyolvi.-.ga ch argj 0nTnTpHrpy. j'^h^tsoavar of the Customer whereby ths Guarantors or any person claiming through th-j.r. by endors.riTientTassTgnTfrriv^oiy^h^.vise would or might on the bankruptcy, insolvent or .vindinp-up of'tli J Cu3t.:mer and to ih .3 prejudice ct .inTJzn>k~uu-xsase the proofs ' vi— \r-Vi-* ■', orm aytak i ■ tha obligl 3hx: J jjc jr t y iJ ’:.-v.w-.ill ba Sxr..i r i r l i g j i^ S r S e n t o f ,.5'i byjh^-^T antars with the Bank for ; h •. 0. r j liol:'.I!'-.-/ h irsa^-i •;s~:.?f3an!i shall have i iia.n an ali securities or other la ras:;:; : th » Z ^ iT lC n .i^ v s i/i autody -sr icharwisa. The Bank shall be property o; .h i C-u. •lilt: " > t rir.Tij/ da.” and li 3.-}u.- .h:v! to jei a>? and apply any cradit balance in any further ant'. ;!•>•* U3 '• >!! : jf account of-.'s. • C o . •,vi,;h hi 2.u>. %-vhsir. s.* r w r .5 or otharwiaa or subject to notice or not) against .iabiii :/ of ilia G'iarantars to tha Bank hsrsundar and to debit any and in o n ii sritisfaorioa ■:f ^tA*-} ifJuiiir-'.'. *rsj*ft sl*ft No as.;1:ran ;a. j.wrrifcy •*.*payman i wh Ich may be avoided und ar aay jnac&n snts relating to bankruptcy or under tha provuian.j ot any other iaw gnvjminj the Cos toner or tha Guarantors and no release settlement, or d'ucharji which may have bean ji van or .-nada on the faith of any 3uch assurance, security or payment ah ail prejudice or aifaut tha 3ank*4 right to recover nrora the Guarantors to '.ha full extant of this guarantee as ifsuch a j j u r m o a , ■ l e o u r i t y , payment, release sa.ttlmdniordiscfcjrsafaa th a case may be) had never been grant*!, //.-/an or mad a. 'Ilia Saak shall be at liberty to retain any security held for the Guarantors* Jiabili ty Ivvreunder for a period ox*javan month 3 after tharapaym snt of all sums tha tare or may become due ta tha .3■ from tha Customer notwithstanding any release, settlement, discharge or arrangement givan or made by tha Bank provided that if at any time within tha period of six months after such repayment either a bankruptcy petition shall be presented against tha Customar or a petition shall be presented to a competent Court for an Order IV tha winding up of the Customer or the Customer shall commence to bo wound up voluntarily tha Bank jhai! be at liberty to continue to retain such security or any part thereof for and durinssuch furth ar pariod as tha Bank may determine in tvhich event such security shall be deemed to have continued to have been bald by tha Bank as security for the payment to the Bank of all or any sums which ahull or may become dua and o’,ving to tha Bank from and by the Guarantors either by virtue of the provisions of this guart:i« 3 or aa a consequence of any Order mada by a competent Court under any provisions of bankruptcy or Company law. Q. The non-a:ca»:ution or invalid execution of thi3 guarantaa by any one or mora of those who have agreed to join in this guarantee '.vii! not a/fast tha liability of thoaa Who have joined in and signed this guarantee. R- This guarantaa shall notbediochargad nor shall tha Guarantors’liability ba affected by reason of any failure or irreQnlarity defect or informality in 3ny3acurity jivan by or on behalf of the Customer in respect of the monies or liabilities hereby secured nor by any legal limitation, disability, incapacity or want of any borrowingpovvars of orby tha Customer or want of authority of any director, manage.; official or other person appearing to be acting for the Customer in any matter in respect of the monias or liabilities hereby secured or any other ciiwmstanea which rend irs tha liability of tha Customarvoid or unanforcsablear.d such monies or liabilities wili ba recoverable by tha Bank from the Guarantors as sole, origin ii and independent obligors upon first written demand by way of a full indemnity together with all losses, claims, costs, charges and expenses to whi oh th a Bank may be subject or which it may incur in connection wi th tha Customer's liabili ties or this guarantaa. S. Should tha Customer be an unincorporate body, committee, partnership, trustees or debtors on a joint account, this guarantee 3hall remain effective notwithstanding any death, retirement, change, accession or addition as fully as if tha person or persons constituting such body, committee, partnership, trustees or debtors on joint account at tha data of the Customer’s default or at any time previously was or were the same as at the data hereof. T. Any notice or demand haraunda!' by the Bank shall ba deamad to be made whan such notice is delivered or sent by prepaid post to tha address of tha Guarantors last known to the Bank or stated hereunder and if posted by prepaid post such demand shall be daamed to be mada at tha time at which it would have been delivered in the ordinat7 course of post. In tha case of death of any of the Guarantors any notice or demand by the Bank shall be sufficiently given if delivered or sent by prepaid post addressed to tha deceased or his personal representative at his address last known to the Bank or stated hereunder unlass and until the Bank shall have received notice in wri ting of tha nama and address of tha person to whom raoresantationhas been granted. U. This guaran:3 2.is and will remain the property of the Bank. V. S v ir ; jciijatio* :: --.J 'z.-.L-.: --v.s j-iaraacaa jhail be discharged in the same cutt wicy 13 ih a; af th .* .. — :r. . ' ; - " : ;-i. :=.«•; :t‘ '..'.s . as.~t:-2~. Aji ;ayraant3 to fee made hereunder by sh j Guana i-srs.-jit-i' . ; j"a-ia i.:.:•aVi.wc'; in; ir.-i? « «ua awaini and without any deduction for or on account of xiy .*ssi.v. ..j. - .-;m, '.tviij, i»T.>5;u. duties, deductions or withholdings or other chargas of whaUvw i . » ! ! * c : e - J , :y;^ntsld v assessed unless the Guarantors are compelled r j law so fc ii s.‘-s i. iiu Guarantors wali pay such additional amounts as maybe nscaasa/y in respect o f * r.: : c : : r - • •>*•**•*• !-*r Lr. v.-dar Mat * en et amounts after such taxes, levies, imposts, duties, d*iiw.hr..;. -.viihlKtdl.-y! .ihiv chrfrfM shall equal tha respective amounts due hereunder. W. If for th 3 purpose jbtair.i.-.zjudgrae.v. In xty court it li necessary to convart a sum due hereunder in one currency (in* thij Ola^e :al;ad ’&* & n\ currency*) into pother surrency Cmthis Clause called th e second currency") tha r-r.J ex-wan 53 v>.'. sha” aa applijd shall be that at which in accordance with normal banking procedure fite 3in!c or.' . ;3u«hace tha tint currency with tha second currency on the business day preceding -1 ^ w'hk'.t nrs v.jud/maai is *i'/an and the obligation of the Guarantors in respect of any such sum due from . '.a tha 3nnk ’lareu.'.-.iar shai!, ^withstanding any judgment in the second currancy.bedisc’nargudonlytijthi iliaton thabusinaaa day folUiwing receipt by the Bank of any sum adjudged to be dua her^und^r th ■"uvan^’y th*i Sonic may in accordance with normal banking procedures purchase U13 rv.-ut with th : 3ao,-:nd .urr^acy; if the first currency so purchased falls shortof the sum originally due to tha 3an!c in i!u ;irst ou.vancy, the Guarantors agree that they Shall, as a separate obligation and notwithstanding any rush jud-^mjn •„ indemnify the Bank against such shortfall X The Guarantorsher-.by irrevocably; (i) submit to the no a • :!miv* pin.;diction of a Court ofcompe tantjurisdiction in the country in which the relative account oi' -'.hi Ousturn.sr is stain tained in rsjpect of any Jagal proceedings in connection with thi3 guarantee; (ii) appoint the Customer as Mi31r Agant fir tha sarvi« of legal process out of the said Court at the Customer’s add/ass hers'm or at tin Cmto.vn.*’a adirasa last known to the Bank; iii) confirm that servi<.‘tf aflagal process out of such Court on the Customer shall be deemed due service upon th’ Guarantors for tha ou.-pojaj of such bjfal procaedings; and Civ) agree that nothing har^'a ihai i affaci the right to service oflegal process in any other manner permitted by laworpracluda .ii^righstobringprocaedingsin any ofcharcourt of eompetentjurisdiction as the Bank may elect and chit ii-ji! ^rocaatiingj in any une or more jurisdiction shall not prejudice legal proceedings in any other jurisdiction. Y. ‘ This guarantee shall be 30v3 .-1 .2d by and construed in accordance with the laws of thecountiy in which the relative account of the Customer >0 maintained. - ; I co Z. Notwithstanding anything herein before contained, this guarantee shall terminate and cease to have efface 011 tha 30ih June 1993 (unless otherwise extended in writing by the Guarantors) ar.d tha Guarantors shall have no further lia b ility under this guarantee save in raspect of an7 written demand received from the Bank on or before that data, 2 1. Notwithstanding ar.vthinj narainbefora contained, the total amount ultimately enforceable against tha Guarantors under this guarantee shall not exceed IEPIOOjOOO (one hundrad choiaar.d Irish Pounds ) . (L LHTZRNAL MEMO From: To: Siobhan Lynch Karie Kavanagh .Subject: Date: Hypothecated Deposit Accounts April 27, 1992 This is to confira that account no. 02/02215/77 in t h a n a m e of Ansbacher Limited ref. Celtic Helicopters L i m i t e d h a s closed as the loan to Celtic Helicopters Limited was repaid. SIOBHAN LYNCH/es AWdixXV?mmab)?. ' . ’ John Reynolds, Esq., Irish Intercontinental Bank Limited, 91 Merrion Square, DPBLIN 2. 16th April, 1993. * Dear John, ; T w i s h to confirm advising that Hamilton Ross will counter­ guarantee you re U.S.575,000 Guar ant ee to Jet Aviation a n d will place that amount o n d e p os it w i t h you as collateral. 4 Yours sincerely, \ * i i , *. •. * ** ; • • » J.D. Traynor. JDT/AJfc p. John “ Reynolds, Esq., Irish Intercontinental Bank Limited;..^ 91 Merrion Square, * DUBLIN 2. Dear John, In connection with the proposed Guarantee in the sun of US$75,000, I would be grateful if you would jfcake this letter as authorisation to place US$75,000 to the qredit of a new Deposit Account and if you would debit the cost thereof to Hamilton Ross Deutsche Mark Account Ref. S . 9 No.04/39236/81. I confirm that if I have been unable to complete on behalf of Hamilton Ross the necessary documentation before leaving tomorrow for Cayman, X shall complete same 'immediately on. my return which will b,e Thursday 29th. Yours sincerely,^< J.D. Traynor JDT/AJW k t • #^ • A 1 The Dir actors, Caltic Halicottars LIjlItad , 43-49 Maspil Soad, Dublin 4 Dear Sirs, ifa ax a pleased to coruJiira tha willingness of Irish Intercontinental BarCc Lijni'ted (■ ’IIB3) t o amend the facility provided to Celtic Haiicootars Liaitad ("the Borrower") in the Facility Latter dated March 9, 1992 (the "Facility Letter") in tha :mannar sat out fcalorv, . 1. cia-u-sas 1 and 2 of tha Facility Latter are hereby delat ed and raplaoad with tha following:ai - .y jw ra r y m o? r a r c t t m i a) A fa cility in an iiaount of IZP100,000 (one hundred ■ thousand Irish Pounds) to provide a guarantee in a fora acceptable t o IIB in favour of Tha Governor and Company of the Bank Of Ireland (^tha SOI Guarantee") in respect of loan .facilities provided to the Borrower; b) A facility in an aaount of US$75,000 (seventy five tho'isand Unitad States Dollars) to provide a guarantee in a form acceptable to IIB in favour o.C Jat Aviation Business Jets AG ("the Jat Guar ante a'1) in raspect of a Lease Contract antarad into by Jat Aviation Business Jets AG and tha Borrovar. Tha ascpression 31tha facility9* w h e n hereinafter used shall mean either or both of the above facilities, as tha conte:ct so admits or requires. 2. flW SnfiTOKT Tha B o r r o w ar will p a y a guarantee commission to IIB as follows: a) WISH INfTWCOKHNtMT.Vt 1% par annum on tha principal amount of the Je t Guarantee which will ha payable in advance of tha is311 a by 113 of tha Jat Guarantee and w h i c h shall ha payable annually in advance tharaafcarj and U'AfTtD • 91 *.l£ttiCN SCLLXJU. :U3UI 1 * 7ZLX7HCML Ol 617744 * FACSIMILE. Ol 7&30Vt -TU_£X. 1 ] ) U x i g i s t ^ u o in r « : : u ; h j . » l i c of i:u w a n d n u m a i i m i i t b) 2. i -» C4r r a a vhi ch shall be payable a n n u a l l y i n adv-ir.cs on the principal aaount of tha BOI G ^ a r'i.'c a 3 *3 C l a u s a 4 oi tha facility La t t e r is haraby delated an d r e p l a c e d vi tii tha following:=■4. TOTOD 07_7A gILITLL M h i l a 113 retains t h a right t o taradnate this f ac il it y on demand at a n y t ioa:a) tha 301 Gua ra nte e i a subject t o r ev ie w o n 30 Jun e 1994 and vill h a cancelled on t h a t data, uni 233 ofcharvi.se extended in writing b y IIB? rand b) tha ast G uarantee is subject to r evi ew o n 30 A p r i l 1991 and trill h a cancelled on t h a t d a t e unless otherwise errtandad in writing b y I IB.* 3. C l a u s e s 6 and 7 of the F a c i l i t y L at t a r are h er eb y aiiended b y t h a d el a t i o n of all re fe re nce s to "the BOI G u a r a n t e e ” a n d th-air repl ac eme nt vifch "the BOI Guarantee a nd /o r t h e J e t G ua rantee** 4. o th e r *7rn c a m m rzm & r ■ \ All o t h e r te r m s and c ond it io ns contained in the F a c i l i t y L e t t e r reiaain un changed a n d con ti nu e to apply. 5. aeSSS2E H E 3i T h i s offer w il l lapse on 30 Apr il 1993. T o acc e p t -this offer on t h a above terms and conditions p l e a s e return 'the en closed duplicate of this letter d u l y s i g n e d b y th a authorised signatories of the B o r r o w e r . Yours faithfully, for a nd on be h a l f of IRISH raTSRCOJTTINENTAL BAJTX LIMITED Liam Donlon B a n k i n g D ir ect or Brian Dunne Manager F acility Latter la firu c e : CC/1S/7053 fttad Ip r ll 2 1 ,1J93 TO; T h a Directors* C e l t i c Helicopter* L i m i t e d , 4 3 - 4 9 Hespil Road, Dublin 4 A c c e p t e d o n the abo ve tern s an d conditions f o r a n d o n b e h a l f o f C E L T I C H EL ICOPTERS L I M I T E D _ Irish Intercontinental Bank Limited 91 Merrion Square Dublin 2 Re: Our Deposit Account with vou No. 03/39312/77 and our Guarantee and Letter of Lien in vour favour both dated 23 April 1993 (the "Guarantee" and "Lien”}. Dear Sirs, We refer to the Guarantee and Lien and note that you intend to extend die period of die facility ; which you provide to die Principal on die terms of your amending letter of offer to the Principal dated June 16 1995. We hereby agree that the Guarantee and Lien shall remain in full force and effect for the period of die facility as extended as aforesaid and that demands may be made under the Guarantee and die Lien enforced irrespective of whether any demand has been made by you on the Principal in respect of the facility. pa»V«lac.doa Irish Intercontinental Bank Limited, 91, Merrion Square, Dublin 2 We hereby authorise and empower you pending payment of any Bills, Notes, Overdrafts, Loans, Guarantees or other contingencies in respect of which we nay be liable to you either directly, jointly with others, as collateral for a third party or in any other manner whatsoever, and notwithstanding that such liability may be current, to hold all moneys which now or hereafter may stand to our credit on Deposit Account No. 03/39312/77 or otherwise and in whatever currency as being available as security for all such liabilities as aforementioned. Furthermore you are authorised to set off and apply such moneys or any part thereof, from time to time in or towards satisfaction of such liabilities enti-jrely at your own discretion without further notice ahd such set off will be a good and valid discharge of such moneys so applied without any further endorsement or authorisation whatsoever. Dated this 2 day of April 1993 PRESENT when the Common Seal of HAMILTON ROSS COMPANY LIMITED was affixed hereto Director/Secretary INTERNAL MEMORANDUM TO: FROM: RONAN REDMOND cc M a u r e e n C o l l i n s C laire G a n n o n SUBJECT: . C eltic H e l i c o p t e r s L imit e d D ate: . 4 M a y 1993 IIB propose to issue a Guarantee today in favour of Jet Aviation for an amount of US$75,000 on behalf of Celtic Helicopters Limited. This Guarantee is to be secured by a lien over an amount of USS75.000 in Deposit Account No. 03/39312/77 in die name of Hamilton Ross Company Limited. Please confirm that this amount has been placed on deposit with IIB, and in respect of the IEP100.000 Guarantee Facility IIB presently provides to Bank of Ireland on behalf of Celtic, please confirm that an amount of GBP100.000 is presently on deposit in Account No. 02/01619/77 in the name of Cayman International and Bank Trust Company Limited. CG/i S i Confirmed: $-QAjCL,*- $ JL o fa a * .cJ. Ronan Redmond II Appendix > I!*-/ COili# > i. CG/AS May 5, 1993 ^ . Jet Aviation B u sin a Jets ALr., Attn: Mr. T. Staub, P.O. Box 1524, _ CH-8053, Zurich Airport, Switzerland /"v Dear Sirs, We refer to the Lease Contract dated . . . . and executed by Jet Aviation Business J?ts AO as Lessor and Celtic Helicopters Limited ("the Lessee") for the lease of a helicop ter Agusta A109, Rag. VR.-BMM for a period of eight years from the date of execution of the Lease Contract (the "Lease"). : ,i ’■"■7 1. In consideration of your providing the Lease under the terms set' out therein, Irish Intercontinental Bank Limited ("IIB”) hereby irrevocably undertakes to pay you on first demand, irrespective of tha validity and the effects of the above-mentioned Lease, and waiving all rights of objection and defence arising from the Lease, any amount up to a maximum limit of USS75.000 (seventy five thousand United States Dollars) (the "Undertaking”) upon receipt by IIB of: . . . a) your written and duly signed request for payment; and b) (i) written confirmation from you that you have not received payment(s) at maturity (as determined in the Lease) for die sum claimed under this Undertaking; or (ii) written confirmation from you that you have received a copy of the written notice from IIB to terminate UB's Liability under the Undertaking on the Expiry Date (as defined in Clause 4 hereof) in accordance with the provisions of Clause 4 hereof. . ' For'.the purposes of identification, your request for payment and your confirmation hereunder have to be presented through the intermediary of a first rata Bank (as determined by IIB) confirming that the signatures thereon are authorised signatories of your firm, and (subject to the provisions of Clause 3 hereo f) are to reach IIB at the latest six months after the termination of the Lease. . The total amount recoverable under this Undertaking is in any event subject to a maximum limit of US575.000 (sev;nty five thousand United States Dollars). 3. _ This Undertaking is valid until the earlier of: a) 30 April 2001; and b) the Expity Date (as defined in Clause 4 hereof) • ***** INrCRCOhTONtNTAL BANK UAUTtO • 91 MCAJIION SQU.MUL. D U 3U N Z • TSLSPMO.'IC. Ol 41 R i c i i T i . t t o i n T H t A i r u a u c o i- lit’ u.vn a n u m k a *osar is o o s fACSlMlLZ. Ol 795034 •TTLIX U S t t ■ ' 4. and in any event expires in full and automatically if your written request for payment and your written confirmation, together with a first rate banks verification of your signatures are not in our possession on or before the earlier of the above dates. IIB may at any time give you thirty days written notice to terminate this Undertaking O'the Expiry Date") on which date all further liability of IIB shall cease, without prejudice to any demand made by you within the terms o f this Undertaking on or before the Expiry Date, and subject to the aforesaid maximum limit of US$75,000. Yours faithfully, for and on behalf of IRISH INTERCONTINENTAL BANK LIMITED Manager Tat: 67S 51-U'37S 3C3i Fax: 6 6 1 2035 A 2¥nri IQUAHS DUBLIN 2 J **- 8th September, 1993 John R (, E s q ., Irish jntinental Bank Limited 91 Harriot! Square, ; DUBLIN 2. - Re; CELTIC HELICOPTERS and KENTFORD Dear John# ' This is to confirm our discussions this morning when I indicated that the backing deposits of £100,000 and £50,000 respectively are going to.be uplifted and replaced in the name of Hamilton Ross and that the counter-guarantees etc. which you presently hold from C.I.B.T.C. will be cancelled and replaced by Hamilton Ross. I am very anxious that we put this into place as quickly as possible and would appreciate hearing from Maurice o r Claire in this connection. Yours sincerely. J.D. Traynor Appendix XV (12) Mr Ronald Chambers 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Ronald Chambers. a) Transcript o f evidence o f Mr Ronald Chambers dated 17 April 2000. b) Statement o f Mr Ronald Chambers dated 12 April 2000. c) Letter o f 3 January 1990 - JD Traynor to Guinness and Mahon. d) Letter o f 10 December 1990 - JD Traynor to Guinness and Mahon. e) Letter o f 22 June 1990 - JD Traynor to Guinness and Mahon. f) Hamilton Ross statement o f account - 31 December 1993. g) Hamilton Ross statement o f account - 30 June 1994. h) Hamilton Ross statement o f account - 30 June 1994. i) Hamilton Ross statement o f account - 31 July 1994. j) Hamilton Ross internal memo - calculation o f interest to 3 January 1995. k) IIB interest statement re Hamilton Ross o f 30 August 1994. 1) Internal GMCT memo o f 28 April 1976. UNDER OATH ON MONDAY, 17TH APRIL 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MR. RONALD H. CHAMBERS Represented by: MR. MICHAEL O'SHEA KENNEDY McGONAGLE BALLAGH 2 0 NORTHUMBERLAND ROAD DUBLIN 4 INDEX WITNESS EXAMINATION QUESTION MR. CHAMBERS DIRECT - MS. MACKEY I - 155 DIRECT - MR. JUSTICE COSTELLO 156 - 189 1 THE INTERVIEW COMMENCED, AS FOLLOWS, ON MONDAY 2 17TH APRIL 2000. 3 MR. JUSTICE COSTELLO: 4 Good morning, Mr. Chambers. My name is 5 Declan Costello and on my right is Ms. Mackey and we 6 are the Inspectors who have been appointed, as you 7 know, by the High Court in relation to this matter. 8 I should explain to you, as I do to other persons 9 who have appeared before us, that this isn't a 10 court, it is not a tribunal; it is an interview. 11 If, in the course of the questions that we ask you, 12 you wish us to stop so that you can consult with 13 your solicitor, please tell us so and we will stop. 14 Similarly, if your solicitor wishes to consult with 15 you in the course of your interview, he will let us 16 know and we will stop and he can talk to you. 17 MR. CHAMBERS: All right. 18 MR. JUSTICE COSTELLO: Mr. Chambers, this 19 interview is under oath 20 and we would ask our solicitor now, Ms. Cummins, to 21 administer the oath to you. 22 23 24 25 26 27 28 29 1 2 3 4 MR. JUSTICE COSTELLO: 5 I am going to ask Ms. Mackey to ask 6 7 Mr. Chambers, you some questions now. 1 Q. MS. MACKEY: Mr. Chambers, before I 8 actually begin to ask you 9 any questions about your statement that you sent in 10 to us, can I have a little bit just about your 11 career for the record? 12 A. 13 2 Q. 14 A. 15 Yes. Can you tell me your present position? All right. Since coming to live in Dublin or prior to that? 16 3 Q. 17 A. 18 4 Q. 19 A. Do you want it from... When did you come to Dublin? In 1967. Well, maybe since then. Since then. I was living in Scotland and working 20 with a company over there. 21 wanted to develop more here in the Republic of 22 Ireland and I was offered the position of General 23 Manager. 24 5 Q. 25 A. They decided that they And that company was? Robert Wilson & Sons was the company in Scotland and 26 the company in Ireland was Burnhouse(Ireland) Ltd., 27 which was the one company operating in the Republic 28 of Ireland at that time. 29 endeavour to develop the business on a 32 county The plan was that we would 1 basis because there was already a company 2 established in Northern Ireland and we were going to 3 centralise the total activity here in Dublin. 4 6 Q. 5 A. 6 7 Q. 7 A. 8 Yes. So you came over as General Manager? That is right. And you continued in that position up until? I continued in that position until -- it was '82 or '83. 9 8 Q. 10 A. Yes. What happened then? In 1980, or 1979/1980, I had a couple of slight 11 attacks, 12 doctor suggested to me that I would need to cut down 13 on my workload. 14 Chairman of the company and it was agreed that 15 coming up to 60 years of age, that then I would 16 retire and a replacement would be found, and I 17 resigned from the company. 18 9 Q. 19 A. 20 10 Q. 21 A. 22 11 Q. I thought they were slight anyway, and the I discussed it with the then In 1982? I think it was 1982, yes. And you are now retired? I have been retired since then, yes, that is right. Yes good. Thank you very much. Now in answer to 23 the letter we sent you asking about Ansbacher, you 24 sent us in a statement and some documents, a Trust 25 Deed and associated documents? 26 A. 27 12 Q. 28 29 Yes. Now do you have a copy of your statement 1 )? (Exhibit 1 13 Q. 2 I would like to just go through that and clarify a few points that are not clear to us. 3 A. 4 14 Q. Fine. You explained at the first page of your statement 5 there at the top, you explained that you came to 6 know Des Traynor when the company with which he was 7 an accountant at the time, Haughey Boland, were 8 auditors to Burnhouse? 9 A. 10 15 Q. That is right. After he had joined Guinness & Mahon in the 1970's, 11 he suggested that a capital sum that you had brought 12 with you to Ireland should be placed in a 13 discretionary 14 of that conversation; what he said to you, how it 15 arose? 16 A. 17 trust. Now can you remember the gist Well, there were a number of discussions with him about the capital sum that I had. 18 16 Q. 19 A. Did you consult him on this? Yes. Yes, I did. As we had built up or were 20 building up a very good relationship and I got to 21 the stage that I fully accepted his advices on so 22 many matters, not only this one but so many 23 different matters in the business. 24 17 Q. 25 suggested, anyway, a discretionary trust? 26 A. 27 18 Q. 28 A. 29 Not to get wound up in too much detail, he He did, yes. Did he explain to you what that was? Yes, this was for the benefit of myself and my family. If I happened to die early, then my wife 1 2 19 Q. 3 Yes. Did he say what would happen if you didn't die? 4 A. 5 20 Q. 6 Sorry? Did he say what would happen if you continued happily to live, who would benefit then? 7 A. 8 21 Q. 9 A. 10 Yes, yes, that is right. What did he say about that? That I would be a beneficiary, and my wife and...(INTERJECTION) 11 22 Q. 12 A. 13 23 Q. That you would? Yes, yes. Now did he explain to you how the Trust was to be 14 set up? 15 than yourself would be the settler of the Trust? 16 A. 17 24 Q. 18 A. Did he explain to you that someone other Yes. What did he tell you? He indicated that this would be transferred to 19 Guinness Mahon Cayman Trusts in Cayman and they 20 would be the trustees of the Trust, and the settlor, 21 then, was Mr. Furze. 22 25 Q. 23 A. 24 2 6 Q. He told you this? Yes, yes. Did he explain to you what would happen to the 25 funds, what Guinness Mahon Cayman Trust would do 26 with the funds? 27 up of a company to hold the funds? 28 29 A. Did he tell you about the setting No, I presume that was already established, Guinness Mahon Cayman Trust. 1 27 Q. 2 A. 3 28 Q. 4 5 Yes. But did he tell you that the trustees would transfer the funds to a company? A. 6 Oh, yes, sorry. The hearing is not the greatest, sorry. 7 29 Q. 8 A. 9 Okay. What did he tell you about that? That the money placed in trust would be handled by these trustees and if transfers were required, 10 11 They were the trustee? contact would be made with him, Mr. Traynor. 30 Q. 12 Yes, but did he tell you that there would be a company established? 13 A. 14 31 Q. 15 A. 16 32 Q. 17 Yes. What company was that? The company was Ascot, Ascot Trusts. Did he tell you that that company, Ascot, would place the money on deposit? 18 A. 19 33 Q. 20 A. 21 34 Q. 22 Yes. Did he say where that would happen? In the Cayman Islands. Did he tell you that you at any time, if you wished, could withdraw money or use the money? 23 A. 24 35 Q. 25 A. Yes. What did he explain to you about that? The situation there was that if any money was 26 required, 27 contact the trustees. 28 36 Q. 29 A. I was to contact him and he in turn would Yes. And in turn, then, whatever was required would be 1 2 37 Q 3 to you here in Dublin in Guinness Mahon? 4 A 5 38 Q 6 A 7 8 No. He didn't tell you that? Definitely not. I always understood that the money in the Ascot Trust was in Cayman. 39 Q 9 Now you say here you got some legal advice about this. 10 11 Did he tell you that your money would be available Did you get any taxation advice? Did you go to any accountant? A No, the only one that -- when I was reading through 12 on your notes, it did come to mind that he did 13 suggest to me on one occasion, which must have been, 14 I presume, around about '72, that I should, maybe, 15 speak to Mr. Alexis Fitzgerald, who is a solicitor 16 here. 17 questions -- some questions, not very many, I must 18 admit -- on the whole document of the Trust; 19 you might be advised to speak to someone else.', and 20 he suggested that I see Mr. Fitzgerald, which I did. 21 Now exactly what happened then, I don't know 22 I was extremely busy running the business. 23 him in his offices in Pembroke Street and we had a 24 chat about it and I don't really remember what 25 happened. 26 40 Q 27 Yes. Now whether it was because I was asking 'well, I saw He certainly didn't advise against it. Did you have a personal accountant at that time? 28 41 Q Sorry? 29 42 Q Did you have a personal accountant at that time? 1 2 43 Q 3 A 4 44 Q 5 A 7 45 Q 8 No, no. Now did you know, Mr. Chambers, that the trust funds, your money, was in a coded account, A/A66? A 10 Not until very recently. I suppose that would have been somewhere in the 1990's. 11 46 Q 12 A 13 Yes. How did you come to know that? There was a statement I received and there was a code on that of A/66. 14 47 Q 15 A 16 17 And you didn't consult any accountant about this other than Mr. Traynor? 6 9 No. Where did you receive this statement? I think I must have received it from Mr. Traynor, or it may have been Mr. Collery after his death. 48 Q When you saw this A/A66 on your statement at that 18 time, did you enquire what that was? Did you ask 19 anything about it? 20 A 21 49 Q 22 A Not that I recall, no, I don't think I did. Did you know that it was a code for your account? It was on the statement of Hamilton Ross, which was 23 another situation which arose, and I don't know an 24 awful lot about that one because I understood it was 25 all Ascot Trust. 26 50 Q Yes. Now the withdrawals that you made or the 27 payments that were made from the Trust, you say in 28 your statement that they began in the late 1980's? 29 A That is right. 1 Now Mr. Traynor had told you that you should go to 2 him, so when you wanted a payment, on the first 3 occasion that you wanted a payment, did you contact 4 Mr. Traynor? 5 A 6 52 Q 7 A 8 That is right, I did. What did he say to you? He said: "I will deal with that and make contact with Cayman and arrange the transfer." 9 53 Q 10 A 11 54 Q 12 A And how was the transfer made? Purely to my bank account. To your bank account? Yes, and there wasn't any further contact and 13 I would have asked him to transfer whatever sum was 14 required and he would have made the transfer. 15 55 Q So you would give him the number and details of your 16 bank account and after that, the thing would go 17 ahead? 18 A 19 56 Q That is right. Now can I show you a document here, Mr. Chambers? 20 It is page 115. 21 is a letter from Mr. Traynor with the heading of 22 "Ansbacher" on 3rd January 1990 and it is addressed 23 to Mr. Lannigan O'Keeffe at Guinness Mahon in 24 College Green. 25 A 26 57 Q (Exhibit 2) (SAME HANDED) Now this Do you see that? Yes, I see that, yes. It is arranging for a transfer of stg£3,000 to 27 Barclays Bank for credit to your account. 28 the account to which your transfer was usually made? 29 A That is right. Was that 1 Now you see from that letter that Mr. Traynor is 2 writing to Guinness Mahon asking for this transfer 3 to be made and he is saying there in the final 4 sentence: "The debit should be to sterling account 5 number 13154 602." 6 history of this whole business, is the account of 7 Ansbacher in Guinness Mahon in Dublin. 8 appear then from that, would it not, that one of the 9 payments from your Trust was in fact being withdrawn Now that, as we know from the So it would 10 from Guinness Mahon in Dublin, from Ansbacher's 11 account. 12 A 13 59 Q 14 A 15 60 Q You would agree with that? Goodness. You didn't know this before? No. Mary, could you pass 116 and 117 and 118. Sorry, 16 not 117, just 116 and 118.(Exhibit 3 & 4) (SAME 17 HANDED) Again, you see there are two similar letters 18 from Mr. Traynor to Guinness Mahon, different 19 officials in Guinness Mahon, and they are different 20 dates in 1990; 10th December and 22nd June. 21 they are directing transfers to your account in 22 Barclays Bank. 23 requested Mr. Traynor to make from the Trust fund? 24 A Again, Would these be transfers that you Yes . 25 They would. 26 debited to Ansbacher's account in Guinness Mahon in 27 Dublin. 28 were you aware that a loan that you had from 29 Guinness Mahon in Dublin was secured on your Again, as you see, they are being Now did you at any time, Mr. Chambers -­ 1 2 3 62 Q. 4 A. 5 63 Q. 6 A. 7 64 Q. 8 A. 9 65 Q. 10 A. 11 66 Q. They were using that as backing? No. The loan to? To you. No. Did you have a loan from Guinness Mahon at any time? No, not that I recall. You didn't? No. Is it possible that you had a loan that you might 12 have forgotten about at this stage in 1974 from 13 Guinness Mahon? 14 Mahon shows that you had a loan for £90,000 in 1974 15 that was backed, in fact, on a cash deposit with an 16 offshore subsidiary of the bank? 17 A. 18 67 Q. 19 A. 20 68 Q. 21 Evidence provided to us by Guinness That I had a loan? Yes, R.H. Chambers. Are you R.H. Chambers? Yes. According to the bank, that is the case. You have no recollection of having any such loan? 22 A. 23 69 Q. No. No, I do not indeed, no. Now going back to your statement, did you have an 24 account, an ordinary account, in Guinness Mahon in 25 Dublin, Mr. Chambers? 26 A. 27 70 Q. 28 29 I don't think so. Is it possible that you had an overdraft on an account? 1 2 71 Q . 3 A. 4 72 Q. I see. No. Very good. Getting back to your statement anyway 5 for the moment, and at the bottom of the first page, 6 you say your recollection is that the initial 7 transfer of capital to the Trust was approximately 8 £60,000? 9 A. 10 73 Q. Yes. You subsequently transferred a lump sum payment from 11 the pension trustees when you were retiring from 12 Robert Wilson? 13 A. 14 74 Q. 15 Yes. Following the sale of your house in Dalkey, you transferred a further amount of about £50,000? 16 A. 17 75 Q. Yes. Now you say none of the amounts placed in Trust were 18 subject to taxation, either in Scotland or in 19 Ireland. 20 taxation"? 21 A. 22 23 24 What do you mean "not subject to Well, the money that I brought from Scotland had been taxed there. 76 Q . A. Yes. And the £60,000 from Irish, I think it was Irish 25 Pensions Trust or Hill Samuel, one or the other, 26 that was all taxed or tax free, I suppose. 27 lump sum plus a pension. 28 29 77 Q . A. I took a Yes. Then when I sold the house in Dalkey, I understood 1 that any tax that was due had been paid. 2 78 Q 3 A 4 5 It had been paid? Any taxes that had been due by me would have been paid. 79 Q I see. I just couldn't really understand the 6 statement that it wasn't subject to taxation either 7 in Scotland or in Ireland. 8 that you meant that it was not taxable income or the 9 tax had not been paid on it? 10 A I didn't know whether by No, I understood that everything was in order from 11 the point of view of the money I brought originally, 12 which I can recall part of it, and the pension and 13 the sale of the house. 14 80 Q 15 So did you get advice from an accountant about that, or from anybody? 16 A 17 81 Q 18 A 19 82 Q 20 21 Yes. Again, I would have discussed that with Mr. Traynor. You discussed it with Mr. Traynor? Yes . But so far as you are concerned, you did not anyway pay any tax on that? A No, not on those two payments or on all the 22 payments. 23 might have been. 24 83 Q Sorry, that maybe is not as clear as it That is okay. Now moving down to the bottom of that 25 page, you say that you believe the final payment 26 from the Trust was made to you in July 1997, but you 27 have corrected that this morning and I think it is 28 July 1998? 29 1 84 Q. 2 A. What happened at that stage to the Trust funds? I spoke with Mr. Collery, who I understood was the 3 man to deal with Cayman after Mr. Traynor died and I 4 asked him in September or October 1998 could I have 5 the balance that was in Cayman to transfer it back 6 to me here in Dublin, and that happened in October 7 1998 . 8 85 Q. 9 A. 10 86 Q. 11 A. 12 So the entire balance was transferred? The entire balance was transferred here. To your account here in Dublin? Yes. It was transferred firstly to Barclays and then transferred here to Dublin. 13 87 Q. 14 A. 15 88 Q. 16 A. 17 89 Q. 18 Where do you have your account in Dublin? Pardon? Where do you have your account in Dublin? With the Ulster Bank. Since 1998, have you had any relationship with Ansbacher? 19 A. 20 90 Q. 21 A. 22 91 Q. No. That was the end of it? As I said, I think, Ansbacher I had not heard of. Guinness Mahon Cayman Trust was the name of 23 Ansbacher before it became Ansbacher, 24 same company in fact? 25 A. 26 92 Q. so it is the Really? That is news to me. Yes, they changed their name when they were taken 27 over. 28 when Mr. Traynor died, what did you do at that stage 29 about your Trust funds? Now moving to another aspect of the matter, 1 2 93 Q 3 A How did you know to meet with Mr. Collery? Mr. Traynor had told me if I required funds, as I 4 said previously, to contact him. 5 contact Mr. Collery. 6 94 Q 7 A In his absence, to He told you that? But this was only done after his death. I had no 8 contact with Mr. Collery prior to Mr. Traynor's 9 death. 10 95 Q 11 A 13 96 Q 14 Sorry? When Mr. Traynor died, you knew Mr. Collery was the man to contact? 15 A 16 97 Q 17 Yes . How did you know where to find him, because at that stage he had left Guinness Mahon? 18 A 19 98 Q 20 A 21 I can't recall how I got to know that. Did you contact him or did he contact you? I must have contacted him for transfers. Yes, I must have done. 99 Q 23 That continued then, you contacted Mr. Collery after that? 24 A 25 100 Q 26 A 27 101 Q 28 29 So when Mr. Traynor died, then, you knew that Mr. Collery was the man to contact? 12 22 All right. That is right. Up to the time that you withdrew all your funds? That is right. When you contacted Mr. Collery, how did that work? Would you ring him up and tell him? A I would have phoned him at home. 1 102 Q 2 A 3 103 Q 4 In his own home. Would you do what you had done with Mr. Traynor, give him details of the transfer? 5 A 6 104 Q 7 A 8 105 Q 9 A 10 106 Q 11 Yes, exactly the same. Did you ever withdraw money in cash? No. Now you got statements from time to time? Yes . During Mr. Traynor's lifetime you occasionally got statements ? 12 A 13 107 Q 14 A Yes, yes. Did he send those to you in the post? The Trust statements would have been either posted 15 to me or when I would have met him, he could have 16 handed them to me. 17 position. 18 108 Q That would have been the normal When you say the Ascot statements, they were 19 statements of the deposit or statements of the state 20 of the company or the Trust? 21 A The state of the Trust, which would have been 22 primarily the opening balances in the Trust, any 23 receipts, withdrawals, interest, and the final 24 balance. 25 So would they be like the documents you provided us 26 with here that you got from the Moriarty Tribunal, 27 if I can just refer you to one of those. 28 52, Mary. 29 (Exhibit 5) (SAME HANDED) It is page 1 110 Q No? 2 A No. There would have been another statement which 3 would have set out the company heading and the 4 appropriate headings that I have just mentioned. 5 111 Q 6 7 Right. Do you have any copies of those in your possession? A I don't think I have. I have been away for a while 8 and I have looked when I came back, but I will check 9 a few more files. 10 112 Q 11 A 12 113 Q Would you do as thorough a search as you can? I will do that. If you have any such documents, or any documents at 13 all relating to them, if you would furnish them, 14 please? 15 A 16 17 Yes. But not that, I haven't seen that type of thing. 114 Q 18 This is what you furnished us with that you received from the Moriarty Tribunal? 19 A 20 115 Q 21 A 22 116 Q Yes, that is right. So you have seen it since then? Yes, but that was the first time. So what you are saying is that the statements you 23 received from Mr. Traynor would have the heading of 24 Ascot on them? 25 A 26 117 Q 27 A 28 118 Q 29 A Yes . And they would give the balance and the interest? That is right. I see. That was, I should add, and I can't remember the 20 1 dates but that name was changed to Ripon 2 Investments, R-I-P-O-N. 3 119 Q 4 A 5 I see . I can't recall when but it would have been probably the early 90's . 6 120 Q 7 A Was any explanation given to you for that? I asked Mr. Traynor. He said; 'Oh, we just want to 8 use another name.' 9 relationship we had was that one rarely questioned He was of the type and the 10 when he gave you information. 11 person; 12 rarely was questioned. 13 121 Q 14 A 15 122 Q 16 17 He was the type of 'well, that is the way it is.', and it You accepted that? Yes . Did you then get statements with the heading Ripon Investments on them after that? A Yes, I did, I think I got a couple of those. There 18 weren't very many, and that would have been on an 19 annual basis. 20 123 Q 21 A 22 124 Q 23 A 24 125 Q Do you have any of those at home? I may have. Again, if you find those, please. Sure, I will, yes. You said a moment ago that those statements showed 25 the various transactions that took place in the 26 Trust, including accumulation of interest? 27 A 28 126 Q 29 Yes . Now did you make any declaration of that interest to the Revenue Commissioners? 1 2 127 Q. 3 A. 4 128 Q. You didn't? No. Now if I could ask you to look at these statements 5 which you furnished us which the Moriarty Tribunal 6 gave you and if I could ask you in particular to 7 look at page 57, 70 and 71 (SAME HANDED). 8 see the first one there? 9 is 31/5/94. 10 A. 11 129 Q. 12 A. 13 130 Q. 14 The date at the top of it Do you see that one? Yes. You have the code A/A66 up in the right hand corner? Yes. The third entry down dated 29th June 1994 says "transfer to fixed, £10,000." 15 A. 16 131 Q. Do you Do you see that? Yes. That is then debited to -- this is a Hamilton Ross 17 statement -- that is debited to that account. Can 18 you explain that transaction, this transfer to a 19 fixed deposit? 20 A. 21 132 Q. Sorry, it is £100,000. £100,000, yes. Page 67, Mary, please (Exhibit 7). If I can show 22 you the document that follows on from that, then, 23 you might be able to explain it a bit better. 24 HANDED) that is a document headed up at the top 25 right hand corner "A/A66A." 26 A. 27 133 Q. (SAME Do you see that? Yes. It is page 1 of what appears to be a new account. 28 Do you see there: "Brought forward from call - 29 29/6/94 £100,000." 1 2 So putting that with the document that we looked at 3 a moment ago, it appears that that sum was 4 transferred from the other A/A66 Hamilton Ross 5 account to this one, which appears to be a fixed 6 deposit account, from what it says on the other. 7 A 8 135 Q 9 A 10 136 Q 11 A 12 137 Q 13 A 14 138 Q Yes . Now did you give instructions for this to happen? No. Do you know anything about this? No. You don't? No. Can I ask you now to look at the page with 15 handwriting on it there that I passed to you. 16 provided this to us. 17 you by the Moriarty Tribunal. 18 is (Exhibit 8)? 19 A 20 139 Q 21 A 22 140 Q You Again, this was provided to Do you know what that No. You don't know what it is? No. If you look at the next page (Exhibit 9), then, 23 which is headed 24 says: "Hamilton Ross, Care of Corporate Services. 25 We confirm your deposit with us." 26 A 27 141 Q 28 A 29 142 Q "Irish Intercontinental Bank", it Yes . And it gives an amount of £100,840? Yes . And then interest at £1,366? Do you see that? 1 2 Now if you go back to the handwritten page 3 8), you will see that that appears to be a 4 calculation of that interest and how it is worked 5 out, isn't that right? 6 A 7 144 Q 8 (Exhibit Yes . You see there that up at the top right hand corner of that page, the name "R. Chambers" appears? 9 A 10 145 Q 11 Yes . So it clearly relates to -- these are your Hamilton Ross statements, aren't they? 12 A 13 146 Q Yes, exactly the same. So it appears that £100,000 of your money was put on 14 a fixed deposit which at 30th August had accumulated 15 £1,366 interest? 16 A 17 147 Q 18 A 19 148 Q 20 A 21 22 Yes . You know nothing about that transaction? No. Could I ask a question about this one? Yes, certainly. The date is 30th November and on the other one, Irish Intercontinental is 30th August. 149 Q Yes. This appears to be a calculation, an even 23 later calculation, because if you look at the 24 bottom, it says: "One month to 3/1/95." 25 A 26 150 Q 27 Yes . So this appears to follow on from the deposit, the statement that was mentioned there in the IIB? 28 A 29 151 Q Yes . So clearly this deposit account continued on from 24 1 month to month from the date on which it was opened 2 in July or June? 3 Yes . 4 152 Q 5 Now you mentioned two companies there; you have mentioned Ascot and you mentioned Ripon Investments? 6 A 7 153 Q Yes . Were any other companies involved in the management 8 of your deposits in your relationship with 9 Ansbacher? 10 A Laterally, the name Hamilton Ross came up. 11 recollection, 12 May 1994. 13 154 Q 14 A 16 155 Q 17 A 19 20 21 22 23 24 25 26 27 28 29 I was only told about that in Yes, but apart from Hamilton Ross, are there any other names? 15 18 From my No. No others that you know of? No. MS. MACKEY: Very good. I haven't any further questions, Mr. Chambers, the Judge may. 1 2 3 4 MR. JUSTICE COSTELLO: 5 Just a few questions, Mr. Chambers, just 6 following on from what you have just said. 7 1994, you heard about Hamilton Ross. 8 Mr. Traynor's death and Mr. Collery told you about 9 it? 10 A 11 157 Q 12 A In May Was that after No, Mr. Traynor told me. What did Mr. Traynor tell you? He said that they were setting up another company 13 and the deposits that I had would be transferred to 14 Hamilton Ross. 15 158 Q 16 Yes. Just so that I can clarify the situation, you were shown, on an annual basis, accounts; were you? 17 A 18 159 Q 19 A 20 160 Q Yes . Account statements? Yes . These appeared to be the accounts of a company 21 called Ascot Trust Limited. 22 it appear to be a company? 23 A 24 161 Q 25 A 27 162 Q 28 You see, I just want to make absolutely clear that Yes . And the trustees were the company, this Guinness Mahon Cayman Trust Ltd., isn't that right? A Did It did to me, yes. there was trustees? 26 29 Was it a company? 1 163 Q These accounts you were shown were apparently of a 2 holding company or a management company, is that 3 what you understood it to be? 4 A 5 164 Q I did, yes. Now did that show that the trustees, that is the 6 Guinness Mahon Cayman Trust, had in fact loaned 7 interest free the Trust funds to this holding 8 company? 9 A 10 165 Q 11 12 I cannot say. I am just wondering do the accounts show how the holding company got the Trust funds? A Well, on the statements I received it would have 13 been purely Ascot Trust, and then the various 14 headings. 15 166 Q 16 17 Was the statement a statement of the trustees, then? A 18 19 That is what I want to find out. Yes, I think it would have been from the trustees, yes . 167 Q From the trustees. But did the statement not show 20 that the trustees, if it was a statement from the 21 trustees, did it show that the trustees held shares 22 in a company? 23 A 24 168 Q 25 A 26 169 Q I don't think so. You don't think so? I don't think so, no. Well, I just want to clarify how you understood the 27 situation. 28 management company called Ascot Trusts? 29 A Did you understand that there was a 1 170 Q. 2 A. 3 171 Q. Limited? I am not quite sure whether it was limited or not. You see, a company is a limited company and it is 4 different from a Trust, it is different from the 5 Trust company, is it not? 6 companies, one being the Trust company and the other 7 being Ascot Holdings Limited or some such name? 8 A. 9 172 Q. Or were there two I will just look at the Trust Deed. You look at that. The Trust Deed does not merely 10 say who the trustees are and it gives the name of 11 the Trust as the Ascot Trust? 12 A. 13 173 Q. 14 Yes. That is the Trust fund which is to be known as the Ascot Trust? 15 A. 16 174 Q. Yes. Do you think the statements you obtained were 17 statements from the trustees; Guinness Mahon Cayman 18 Trust Limited? 19 A. 20 on an annual basis. 21 175 Q. 22 A. 23 17 6 Q. 24 A. 26 177 Q. 27 29 It was from the trustees, then? From the trustees, yes. And you understood that the Trust funds were deposited in the bank in Cayman? 25 28 That was my assumption when I received the statement That is right, exactly. You don't know in what name they were deposited, is that right? A. No. I always understood that when I would have asked for a payment from Ascot, that this had to go 1 2 178 Q 3 A Well, when I say in the early 1990's, I think it was 4 that Mr. Traynor suggested that he wanted to change 5 the name to Ripon Investments, that they had some 6 other use for Ascot, and that is what happened. 7 179 Q 8 A 9 180 Q 10 Changed the name of what? What was the name? Ascot Trust to Ripon Investments. Do you mean that the Trust fund would then be called Ripon Investments? 11 A 12 181 Q 13 A 14 182 Q 15 That is right. That is what you understood? That is right. Yes. Now he said he had another use for Ascot Trust; is that right? 16 A 17 183 Q 18 A 19 184 Q Yes, yes. I.e., the name Ascot Trust? Ascot Trust, yes. As far as you were concerned, then, there was only 20 one legal entity that you were concerned with, 21 namely the trustees, Guinness Mahon Cayman Trust 22 Limited, who were looking after a Trust fund which 23 was called Ascot Trust. 24 understanding? 25 A That was your That is right, that is my understanding exactly, 26 yes . 27 Now there is one other matter I want to refer to and 28 it is a matter of a transaction that occurred a long 29 time ago and I want you to refer to it. It is page 1 162. 2 (Exhibit 10). 3 is : (SAME HANDED) This is a record from the bank It is dated 28th April 1976 and it 4 5 "Guinness Mahon Limited enclose herewith a cheque for $500 on the instructions of Mr. R.H. Chambers". 6 7 8 Mrs. Webb in British Columbia, Canada. 9 10 A 11 186 Q 12 A 13 187 Q That is my sister. Your sister? Yes . Would you look at the top document on that photostat 14 and this is an internal memo. 15 GMCT." It is stated "file 28th April, it is the same date. 16 17 "I confirm having asked you this morning at the request of R.H. Chambers to transfer $500 (Canadian for preference, but US if this is not possible) to Mrs. Webb in British Columbia and to debit GMCT's A/N deposit." 18 19 20 21 Doesn't that look as if the money that you were 22 paying to your sister was coming out of an account 23 that Guinness Mahon Cayman Trust had and that it had 24 a code "A/N" attached to it? 25 A 26 188 Q 27 A 28 189 Q 29 Yes, it looks like it. You don't know anything about that? I don't recall that, but 1976. It is a long time ago, but doesn't it look, Mr. Chambers, as if the money that you were giving 1 to your sister was coming out of a Guinness Mahon 2 Cayman Trust account in Dublin? 3 A. 4 Yes, it does, yes MR. JUSTICE COSTELLO: 5 Thank you. Mr. Chambers, 6 7 Very good. I think that is all we need trouble you with today. A. 8 Thank you. MR. JUSTICE COSTELLO: As Ms. Mackey has 9 indicated to you, if you 10 find any further documents of any sort relating to 11 your relationship with these entities, we would be 12 glad if you would send them on. 13 come in to sign the transcript of your evidence 14 today when it is completed. 15 A. Yes, surely, I will do that. You will let me know 16 when? 17 MR. JUSTICE COSTELLO: 18 21 22 23 24 25 26 27 28 29 Ms. Cummins will let you know, yes. 19 20 We would ask you to END OF INTERVIEW 45ner rm 0 (0.033 7 qff?Ip pnaoo STATEMENT OF RONALD CHAMBERS In 1967 I moved from Scotland to Dublin to take up employment with Bumhouse (Ireland) Limited a company, partly owned by New Ireland Assurance Company and partly by Robert Wilson & Sons (Ulster) Limited. I brought from Scotland a capital sum o f approximately £80,000/£90,000 which I placed on deposit in the Ulster Bank. Haughey Boland, Chartered Accountants were the Auditors to Burnhouse (Ireland) Limited and over the years I had come to know Des Traynor. In early 1970's after Mr. Traynor bad joined Guinness & Mahon he suggested that the capital sum that I had would be better used by placing it in a discretionary trust for the benefit o f myself, my wife and children. He suggested that a trust be set up through Guinness Mahon Cayman Trust I accepted his advice and a trust was subsequently established. A copy o f the Trust Deed was subsequently furnished to me and a copy is furnished with this statement. I accepted completely Mr. Traynor’s advice to provide.for my family in the event o f my untimely death. I did not meet John Furze, the settlor o f the trust at this time but I did meet him for the first and only time at Mr. Traynor’s funeral. At the time I was advised he was an associate o f Mr. Traynor. I had at this stage a dose business and . personal relationship with Des Traynor. He had always given me sound business advice and I had no reason to doubt his advice initiation to my personal affairs. He assured me that the trust was perfectly legal and complied with all tax requirements. To satisfy me he suggested I take legal advice and he arranged for me to meet with Alexis Fitzgerald, Solicitor. While I cannot recall the specific advice given Mr. Fitzgerald did not advice me against the proposal nor did he raise any concerns o f a taxation nature. It was some time before the trust document was furnished to me and when it was Des Traynor confirmed again that the trust had the approval o f tax consultants both here and in the Cayman Islands. My recollection is that the initial transfer o f capital to the trust was approximately £60,000. This represented the original sum which I had brought from Scotland less the cost o f purchasing a house in Dublin. In 1982/1983 when I retired from Robert Wilson & Sons I received a lump sum payment from the pension trustees. This was approximately £60,000 and again on Mr. Traynor’s suggestion I placed it in the trust. A further sum was placed in the trust in 198S following the sale o f my home in Dalkey. My recollection is that an amount of £50,000 was placed then in the trust. None o f the amounts placed.in thetrust were subject to taxation either in Scotland or in Ireland. ' Until his death in 19941 dealt solely with Mr. Traynor in relation to the trust He furnished to me statements from time to time and from my recollection they were the opening balances, receipts, interest and, where appropriate, withdrawals from the trust These statements were either given to me by hand by Mr. Traynor at one o f our frequent meetings or alternatively were posted to my home. At an early stage Mr. Traynor advised me to talk to him if any payment was requested from the trustees. It is my understanding that he would then contact the trustees in Cayman and tome time after that a transfer would be made from the trust. In most cases transfers were ny»fo directly to my account in London. After Mr. Traynor’s death I dealt with Padraig. Collery in relation to the trust The trustees commenced to make payments from the trust in the late 1980’s when payments were made to me and to my children Ronald and Colin. I did not recall any payments being made earlier than the late 1980’s. A w . I believe the final payment from the trust was made to me in July J£97*and apart from the Trust Deed, and other documents furnished with this Statement I have no other documents or papers to hand in relation to the trust. When I moved house in 1988 I destroyed many documents and papers and assume that the statements which I received periodically from Des Traynor were destroyed at that time. Since my return to Ireland recently I have looked for these statements and I will continue to do so. The documents at 4 and 5 were received by me from the Moriarty Tribunal prior to my interview with the legal team o f the Tribunal. I believe these documents had been furnished to the Tribunal by Padraig Collery. I do not understand some entries in the statements furnished at 4. 1 know nothing about and had never heard o f Amiens Investments Limited or Kentford Securities Limited nor indeed had I heard o f Ansbacher Limited prior to the Dunnes Stores Payments Tribunal under Mr. Justice McCracken. Documents furnished: 1. Trust Deed dated 20 March 1972. 2. Supplemental Deed dated 20 March 1972. .- 3. Letter o f wishes dated 20 March 1972.' 4. Copy statements 3 1 58y45Sftt>9 April 1996 relating to the trust 5. Copy Correspondence. Dated the C t day of Signed: Ronald Chambers. 2000 . ♦ I r ■ v )$ :% Please reply to.: 42 Fitzwilliam Square, Dublin 2.. Tel: 765144/763065 Fax: 612035 Cayman, BdciiK West India Phone: (809) 949-4653/4 Telex: CP 4305 Rue (809) 949-7946 (809) 949-5267 - 3rd January, 1990, M. Lanigan-0'Keeffe, Esq., Guinness & Mahon Limited, 17 College Greeti, DUBLIN 2. Dear Martin, Could you please arrange the transfer Barclays Bank, 81 Fleet Street, LONDON EC4Y 1ET for credit of the Account Mr. R.H., Chambers Account M**.10251119. The debit should be £o Sterling Account No. 13154602. Yours sincerely A Member oftheHenryAnsbacher f o ld in g s Please reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 PLC Merchant Banking Group P.Q. Box 887, Grand Cayman, British Wat Tnrffo Phone: (809) 94*4653/4 Telex: CP 4305 Fax (809) 949-7946 . (809) 949-5267 10th December, 1990 H. David Humphries, Esq., Senior Manager - Operations, Guinness & Nahon Limited, 17 College Green, DUBLIN 2. . ) Dear David, / Could you please arrange the transferr of Stg.£10,000.00 to Barclays .Bank pic 81 Fleet Street, LONDON EC4Y 1ET, for credit to the Account of Mr. R.H. Chambers, Account No.10251119 The debit should be t< Yours sincerely. >acher Limited Account No.13154602. _____ Q ---------Ansbacher L im its ^ A Mtmbtr cfthtBmry AnsbcdttrHokSngsPLC MerchantBanking Group P.O. Box 887, Good C tynu, British Wot t« h— Phans: (809) 949-4633/4 Tetoc CP 4305 Rue (809) 949-7946 (809) 949-5267 Please reply to: • 42 Fitzwflliam Square, D u b lin ! Tel: 765144/763065 Fax: 612035 22nd June, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness & Mahon Limited, 17 College Green, DUBLIN 2. i Dear David, Could you please arrange for the transfer of Stg.£10,000 to . Barclays Bank pic, W Fleet Street, London EC4Y 1ET. ‘ ‘ For credit of the Account of Mr. R.H*' Chambers • Account No.10251119. • The debit should be to Ansbacher Limited Account No.13154602, • Yours sincerely, J.D. Traynor. JDT/AJW * I 30/11/9 31/12/93 61/12/93 31/12/93 anouamronmeu Interast to 31/12 I93 . 7) 2250.06 177700.24 179950.30 - . .0 3 i" n41"In APWndix ) ■ M i r fjM IILTON ROSS L. VAt-UE DATE il/05/94 Jl/06/94 20/06/94 29/06/94 JO/06/94 PESC R IPT lO N BROUGHTFORWARD 09/05/94 20/06/94 29/06/94 30/06/94 KBV ENTRY DRAWN TFB TO FIXED Interest to 30/06/94 ) A /A 66 ACCOUNT NUMBER 80001651 PAGE BALANCES SHOWN ARE IN: gterlj 681.00 5000.00 100000.00 176787.05 177468.05 172468.05 72468.05 1181.43 73649.48 Appendix xvm'mh) - DATE 29/05/94 . BROUGHT FORWARD. 29/05/91} 29/06/94 CALL . - omen mame A /A 66A ACCOUNTNUMBER 80001652 PAQE BALANCES SHOWN ARE IN: sterlins 1 0 .0 0 100 0 0 0 .0 0 100000.00 ____________J m uum ’ ■ jfUHIILTOH ROSS _ J L . 30/06/94 29/07/94 29/07/94 29/07/94 29/07/94 29/07/94 29/07/94 BROUGHTFORWARD BELODGED Interest to 29/07/94 REPAID 'J ✓ ACCOUNTNUMBER 80001652 PAGE BALANCES SHOWN ARE IN: Sterling 100400.68 400.68 10 0 0 0 0 . 00 . 100400.68 100400.68 . . .Ir. 44.? .17361(I..- 1-Il-II-ll?nl3vll. 1-1.1.51." . onl-f?iouqu illuluf'o. . Innis.nllral I . oiling. {Id?k?u?woduio mam'l-I nl .I a. I toil .annaleJoli'nlI-llui-ll- - .Ouuol- null-1 Ill- . Desilu . .'Iuao . u. 0.01c.muuw . . o-Il' . .9 o. 9 v0.. 1 clinic-II? -. Iii-.1. ?cloto.o.ltla.II.Qlice$..V.iallc 1.3.0.19.- . Io . .. 1.11.01qu Zul- lo . a. .al Sill .1 .5005 .. . . Ill . 1? . J: .7343:- owLE, :0 . vh?m?vlnup, 1 1 Wm?hnquE?Arkafwiai .1 .942. rt . IRISH INTERCONTINEIfrAL BANK LTD. 91 Menioa Square • ' * Dublin 2 Telephone: (01) 6619744 Telex: 33322 Facsimile: (01)6785034 MAILTO: H A M I L T O N R O S S CO L T D C/O C O R P O R A T E S E R V I C E S D.u: 3 0 A U G 9 4 W -We confirm Y O U R D E P O S I T W I T H US Per -*. . FROM m TO • 3 0• A U G 9 A \ 5 0 NOV 9£ i •• t• i " ! CURRENCY RATE 5 . 3 7 5 0 0 0 0•0: i: ■ . *. ■ • •AMOUNT 1 • , .. 10 0,840.7.9 r •* 4 • v 'INTEREST itftift/...- . R.f:XA5592 : , ;l/36;6.19 .f:!?™-; s-1 .' V: ‘ . ■102<20.6-98 * MATURITY !*j •*U,‘ :’ A .T*. .M A T•U R I T Y . I• •’ X l T WE WILL PAY FOR YOUR ACCOUNT TO • ! .i. .> •. • ••:! •••' •: 1 •,. •••• ! . 1 .M • OUR PAYING AGENT AT R E N E W A L AMOUNT INTEREST A 0 JUS T. TOTAL , .WILL PAY FOR OUR ACCOUNT TO . 100/4C0.6S 440.11 0.00 100/840.79 I R E N E W A L 1U N L E S S I'DTHERWISB!- A D V I S E O • A.J.W. to B.McL. • 28th A pril 197S. f i t 3 .M.C.T I conflxa luring aak«d you till* Morning, at tba raqueat oi llr. a.B. C h u b « r a f to transfer 1500 (Canadian for pr» 2 aranca but U.S. 11 this Is not possible) to jfrs. B.N. W«bb, Grasthaa's Landings, fast Boro Sound, British Colimbia, and to d»bit G.x.C.T. A/H Deposit. //ifO • o •0 • 7 iX«L Appendix XV (13) Mr Samuel Clarke, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Samuel Clarke. a) Letter o f 18 August 1971 from Kennedy Crowley & Co to W Ronan & Sons. b) Letter of 8 March 1972 from Kennedy Crowley & Co to GC Crampton. c) Extract of transcript of evidence o f G Crampton dated 8 February 2000. Kennedy Crowley &Co. Chartered Accountants Hainault House 69/71 St. Stephen's Green Dublin S Telephone 757971 John Kenan, Xsq., V. ftmum & Son*, 94/95 South Mall, Cork’ Hrf: m / A DTK/A D w e :18 August 1971 zii Cayaan Islands Trusfc Dear John, ' . In tha couraa of discussions which I had on Friday with Kasara. ' Ceorge Craapton aad I was asked to write to you asking you to advise thaai aad Messrs. 8. Clarke, 8. Seyaour, J. Sidney Ease aad I. Vebb regarding tha eatabllshaent of discretionary trusts .. In tha Cayman islands. I had already aant you for ganaral information a draft of a trust dead Which is used in the Cayaan Islands and tha above naaad would like you to advise then aa a group on the suitability of such a truat deed for their purposes but at a later atage ^eferesss will of eonrs* be naeeasaxy to the individual requirementa of each. In tha flrat instance they would wish to have written sdvlee aad at a later atage they would like to discuss this written advice with you on aoaa suitable occasion when you are In tom. Aa you know from your other connections theaa trusts will be th* recipients ultimately of certain tax free profita in the Caynan Islenda and the anxiety la that tha arrangaaenta should be as flexible as possible, consistent with tha continuing tax free stsfeus of the trust aad of appointments wade by tha trustees to the benaflclaxlea of the truat. I have already given you some consent on the general features of the truat dead and if you feel a further discussion would b* helpful pleaae let as know. I an sending a copy of this latter to Nr. G, C. Crstepton. Tours sincerely, D. Raid M artin C w )" VCA Dvckm Ci4liiu AC A Conor C rvw tiv V'CA 1.suirawi- Crowlry KCA N li# Crtnvlcv KCA Wikiaml'nli'y KCA lidpr KmMrr KCA KiKvnrtl Iwvjjun KCA (Wan O'Cmimir ACA )lu\ icl K i w i - KCA AK-* Sfwiii KCA (iuMtiUuitt t*rntcip)d Mtmujcvre (k-ndtl W h w lrr KCA Snrmiin Rule IV to Lynch l)un KvM Kennedy Crowley &Co. Chartered Accountants Hainauh House 69/71 St. Stephen's Green Dublin S Telephone 757971 G.c. Craapcon, Kaq., 9, Maple Hoad, Dublin 14. . • ML/OC 8tfc Re; ijyj Cavan Tnitt. Dear Kr C m pton, I n w i ry chat it has taken m rather longer to «oaa b u k t tba irmft Latter of Wiahea. 1 m nam eneloaing six eopiea o draft ao that It may be considered by each of tba individual Z chink that tha tmtm of tha letter ara fairly eelf-explanatory and ■bould not (tv* via* to any probleM bat, should anyone wish to dtaeuaa thea with at X m i d be happy to do ao. since I M r you we have aeat to the caynan Xalaada tha revised draft Truat Dead, together with tha detail.) required to complete tha appointed elaaa is aaeh ease. . For eaaa of reference, and to avoid too anch identification, we are tha Truata tha Whitethorn Truata. Tour o n will ha the Whitethorn A Truat, M e Clark* a the Whitethorn B Truat, Hr Xaat’ a tha Whitethorn C Truat, Mr Seyjaour'■ tha Whitethorn I Tmat, and Hr Webb'a the Whitethorn p. trust. ■ As soon aa tba Treats ara d r a m up I will have tha Latter of Wlehaa signed in each ease by Paul Harris -who la the settlor. Two foxaal atape will than remain to be taken. Tha firat is the formation by the Truatees of a coopany (or coapaalaa) to receive income froa deposits or investunts an behalf of th« Trustees. The ascend will be the execution by Paul Harris of a Dead (la blank) aaaigning his powers as Appointor of the Trusts. Toere sincerely, JL x eld. Kncls. I t'.1 V.' \ Kura** H ‘ \ !\«h\iwi U.nn^m I’l \\ 'm v k y l*C' \ i^riart O V m iit c r M '.\ IVrtniU rtwhy H* ^ t'*%*N V\*i!,r.ir.t ^’nkv V*.'\ UivM Kt’ ' Alt\S*»m »’l•'» ritmirlium I'nw ijeil W ’ltn 'H r l*V.l link* lVi*r Lvprh fnni 3 I 4 ! 5 3 6 7 236 Q. I w o u l d like, Mr. C r a m p ton, if w e c o u l d g o through, 8 b r i e f l y the last set o f d o c u m e n t s y o u g a v e us, w h i c h 9 w e g o t yest e rd a y (SANE H A N D E D T O MR. C R A M P T O N ) . 10 Yes, this m i g h t b e a g o o d t i m e t o -- 11 now, Mr. Crampton, a n d y o u m i g h t l i k e to l o o k at 12 t h e s e documents I w a n t t o g o t h r o u g h w i t h you. 13 will break for ten o r fifteen m i n u t e s . 14 A. we will break We A l l right. 15 16 sh o o t APJOTnuaaarr 17 18 237. Q. MR. JUSTICE COSTXEiitOt Mr. Crampton, w e w i l l c o n t i n u e then, 19 would you 20 l o o k at this file of d o c u m e n t s t ha t y o u g a v e us 2 1. yesterday? 22 23 238 A. Yes. Q. I t h i n k it is d o c u m e n t No. 10 o f 8 t h M a r c h 1972. 24 T h a t is f r o m K e n n e d y C r o w l e y t e l l i n g y o u h o w t h e 25 T r u s t s w e re g o i n g to b e s et up. 26 t h e r e w e r e t o b e s i x T r u s t s s e t up, E x h i b i t l? 27 28 29 239 A. Yes. Q. D o y o u see that? A. Yes. D o y o u s ee t h a t 1 240 2 3 241 4 5 242 6 7 243 Q. Mere these fellow Directors of yours? A. C o r r e c t. Q- Were these Trusts set up, do you know? A. That, I do n ot know. Q. I do not know? A. NO. Q- You have n o t talked to your fellow Directors at all about this? 8 9 10 244 245 13 14 A. There is only one alive at moment. Q- Who is that? A. 11 12 246 Q. A. C orr ec t . Q- Is it your recollection that y ou d i d n ot talk to a n y 16 247 18 A. X understood that there were . ..(I N T B R J BCTION). Q- Y o u understood that they were all set up? A. Yes, but I could not confirm that. I understood there were six trusts. 19 20 - of them after this financial arrangement w as made? 15 17 . 248 Q. D o you know whether a ny of t h e m h a d Ansbacher 21 accounts such as you h a d o r Guinness & Maho n 22 accounts such as you h a d in Dublin? 23 24 249 25 26 250 A. I a m sure they had. Q. You are sure they had? A. They probably had, yes. Q. in other words, you think they carried o n the same way as y ou carried on? 27 28 29 251 A. They might, but not for as long. Q. Not for as long? Appendix XV (14) Mr Henry J Cleeve 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Henry J Cleeve. a) Letter of 27 March 2002 - A & L Goodbody to the Inspectors. b) Guinness and Mahon statement re GMCT of 25 January 1980. c) Guinness and Mahon statement re GMCT of 22 February 1980. d) Guinness and Mahon statement re GMCT of 28 March 1980. e) Guinness and Mahon statement re GMCT of 15 May 1980. f) Guinness and Mahon statement re GMCT of 31 July 1980. g) Guinness and Mahon statement re GMCT of 22 August 1980. h) Letter of 18 August 1980 - Derek Holden Solicitors to Guinness and Mahon. Appendix xv ix A&L G O O D B O D Y S OLI CI TORS International Financial Seivtces Centre, Norfh Wall Quay, Dublin 1. Tel: 353 1649 2000 Pax: 353 1649 2649 DX 29 Dublin email: law@algoodbody.ie Website: http://www.algoodbody.ie Our Ref. Your Ref. . DRB/JHH C/C33/NSPM . 01-306028 Date 27th March, 2002 Dear Sirs, W e have been instructed by Henry Cleeve of The Old Rectory, Gowran, Co. Kilkenny who has sought our advice in relation to your letter to him dated 12th March, 2002. Mr. Cleeve has instructed us that the funds used by him to set up the Springfield Trust (referred to in the Guinness & M a h o n Limited statements appended to your Preliminary Conclusion) had been received by him by way of a bequest, in Canadian dollars, from the estate of his aunt, a Canadian national, w h o died in 1979. Y o u should be aware that Mr. Cleeve is aged 94. W e look forward to hearing from you. Yours faithfully, ^L I ^ A & L Goodbody Office of the Inspectors Appointed By Order of the High Court to Ansbacher (Cayman) Limited, 3rd Floor, Trident House, Blackrock, Co. Dublin. T:\LITIGATE\BJW\MAIL-OUT\DBLT2704.03E M G. Dickson E.Brunker N.H. Martin S.C.Hamilton R.B.Buckley M.T. Beresford F.J.O'Riordan T.V.O'Connor H N.Healy M A.Gieene P.M.Law D.J.Sanfey S.W Haughey P.R.Dobbyn C.M. Preston P.J.Carroll J.N.Dudley j.H.Hickson M.F.O'Gorman C.E.Gill J.A.O Farrell E.M. FitzGerald S.M.Lohan B.M.Cotier J.G Grennan I.B.Moore J.Olden J.Coman V.J.Power L.A.Kennedy S.M.Doggett B.McDermott C.Duffy E.M,.Brady P.V.Maher S.O'Riordan M. McKenna K.A.Feeney M. Sherlock E.MacNeill A.V.Fanagon E.A.Roberts D.Glynn J.B.Roche C. Rogers C.O Donovan G. O Toole j.N.Kelly N. O’Sui'ivan M.J.VVaid A.C. Burke j.Given D.Widger Consultants: JR.Osborne ProfessorJ.C.VV.Wylie A.F.Browne M.M. Muldowney DUBLIN LONDON BOSTON NEW YORK BRUSSELS «TaTKM(hT oi*ACCOUNT with G17 UCollefje I N(irefm N E DSublin S +2 RWO.BIo*A55AHfelsphone7l6V O N LTD 44 j ACCOWT MAMC <«* a cvrmsHcr STERLING A C C tH f^ T ftUVfMY SUP CO w n w non »v\TC O. O '•'N o o 'V*nHCW.M»3 iSw>*nMi ml tM M l xoilfMpfxmfKtr*fmy Arp ifwvttH 36561/02/08 STATEMENT DATE 2 5 JAN60 DS9IT VACU5OAT? 5»0)FCn hUflHUMl fPrsARO I1?JANB0 Onj am«u *.700 *?*. ovr*-***? ng* ;*t?>*. ; . . no* onj^MBO WAHIt*?* lMSM?A«C* P'Stf’ 1°?® CO ';o*u**r*u »*AMf» ,• . . ••' . .©*»j A‘IIIO ’’At*. CMA*G5 .• .(W4Mi»li »jp rMif •r;:-:. •. o«jArmo OMIT CM - ■ .*,. Hi ‘31 j-V-fStl *t**.fon ^ T ? : '.AAM"X ■•.■;■■.; *■~":A-: ' . • • 31JAM-^0 ;vniAMnn *>tf *•*!.■ . . .. . *• ' ia .»Aunn o c^n*S'«^ 700^ -»{i -iX*1 'or AAMO ; .•■. * PS *«*?1 11 ^ .. *; m *C: T*^rO?":;- •.o'’ V • :i rj w io ;?1JAnno CMAnnc^ ag. r- 3-io; :.<• . ’ . ' . • • ’AT . ' t"A. “■ •’ •v *MT^t ' . r*£JAH«P TO ;23JAH«0 •Tt *’ j ■■•'■' ■'■■ ' "'*v. *00.**M I '?.*J AMAf) ntvn >7J AH.-\0 nr^ufi ^“.JAMftO ^Ofl^ ACCOUNT HUMDEn cnspn 18/11 i , b:> 3 ,133-55 1f 55*S,OU -■ ^o?,on a, go •■'■*-■ -...: • ’;V ■■'" "PQ ?:. .i/‘00o,pn .• .1/rOQ«-00 'Y■: V• • ’■ : ■ . : i / j« ’ ■ . BALAflCE m ,ii 11/ton, m 1,000n00 3no,(Kl 3«tfjn,QO - 17/7T3.'?? ••-.17,10^,10 ;• ■-i 3/104,1? ?,oor^*,8 • ,17/1V3,67 7■•••''' ' ’. :•■":• .: v 17/1U2,01 2^0(10,00 ' v 1?.*1??,Q1 *■”}.. I5,ra : tfc.3U,?3 . 16/316.?»s O V M P D A W N BALANCES A l l * MAMCCO O R . xvammc) I ;:Y ’• a of*Actoui.r\.. ‘ -I G U IN N E SS U P 17 Coll4fl« Gr-wo DmWIo S t PO. Box 55AT-bftora7l694>( BANKERS 1 CUtttHCKs MAHQH CAVttAH TRUST UO •N .o !«li T 1:1 3«3ft1/02/«e SUHUHf, KOHOSIf s w r co LEOGEB STAT’SMtHT O/ITR Z ? f EdflO f'AU'HCR *wina«.A«* •jtomght fonHAn» utr»o mix*-! . U * ' M n v*>*'C.r*> -’.ITffRo Hfj ctr'i'tz. ■sr ■■;r-rf-xni~ ....... . ... ’ . "• ■:: M & r-:". ;■ ■ .■ .. ,... ~~y?{ a M W». c O- ■ er**%.. Ir w•.■■■> rf*r «»»r cci .. C- & C•-.TC-':<.:■ ; \ .. T~. 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V,;•„v ->• •* ,;»• •/’‘' * *;'jV-~ J f . ** .; i. <« »' , --->; t ; .i -a! :!2 j W M 9 3 S» ;'■ /• * .*■ ■■• /X J a O u“ 3 jS * * O w 3 3 * ; 3 3 ■ £ 32 a ~u«* ) ""H ■J ■ ^J5 -V . * -O .fei! f-j;;* O 3 oo J I o f*i /•> a ■s . 3 O«» o o o J*( ££ £) ■UJ •TTSi»£«3 O j A •3 ‘'“-I Uu:,-«s5Sl O o *• kd '-/-J 3 >- V.* •.•*+! ■4 3 • -sil 0&5j»? : .3 .:‘*• •U .8i sc .:. i'. ’ • •• 3 O -9 O Zt PUi -o "Zui ~ W‘JJ & 3 a«;><;< j 3 W V& V? * < v a » o •» ■* o jj , o J * i . s £ J . o ( • . J •» ►o a ■o a o 3 » ooo-ooo* o .-oSI .'» j■■»»J3 30■«. j - j O >3 \> - v l ' j V> .» s a 3 » 'is sa j 3 a . >•»** « <«i »-Mi<«K• •*•»»■:.v-* *»••*« ••• *« ■•*-*i >S 3 s s ».!.. d ta © s» 5 » » iV ) ... '3 ;• v') vl..;•'?.■'Ll '■•".■^'t5 ' 7 - '.:v xa ■ * > » Hi i v'-M 3< •;.• • .*A• : !£*■■: -.■-'\ , . DEREK HOLDEN M.G.W. T CY A.P.C. J j .SON D E R E K iXOSkbOeSBx H O L D E N & C o. G.C. BRYANT, M.A. (Oxon) A ls o a t: 63 High Street, Egham, Surrey. Egham 36121/2. Midland Bank Chambers, High Street, Staines, Mx. Staines 62511/4, 58661/2. 56A, Church Road, Ashford, Mx. Ashford 44251/2. OUR REF: YOUR REF: 003176 SOLICITORS PS/JD/CC2966 Cleeve DPC/MM VICTORIA HOUSE, 44 PARK STREET, CAMBERLEY, SURREY. GUIS 3QF. Tel: Camberley 28122 (5 lines) l8th August, 1980. The Accounts Manager, Guinness & Mahon Ltd. 17 College Green, Dublin 2 P.O. Box 55A. Dear Sirs, re: Mr. H. Cleeve. Thank you for your letter of the 14th instant enclosing cheque for £8 0 0 0 . on behalf of your above’named customer. Tours faithfully, MM Derek Holden & Co. Appendix XV (15) Patrick J Clonan 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Patrick J Clonan a) Letter of 16 M a y 1990 from JD Traynor to Guinness and Mahon. b) Letter of 22 June 1990 from JD Traynor to Guinness and Mahon. A Utmbtr t f dm Bmry Ambmh* J 'JMbwMbky l 9X1 B n W , Q tu d j Please reply to: 42RtrwflHam Square, Dublin 2. U ± 753144/763065 Fax; 612035 ,MlkfcW« PhooK 009) MM653/4 Tcta CP 4303 Hue 009) M9-7946 009) 949-5257 16th May, 1990. N. David Humphries, Esq., Senior Manager - Operational Guinness • Mahon Limited, 17 College Green, DUBLIN 2. f il e t/;k n ■« * i Dear David, Could you please arrange for me to collect Travellers Cheques to the value of Stg.£1,000 (10 x Stg.8100) on Friday morning. They are for P.J. Clonan and he will be calling in next week when I shall get him to sign and return the relevant documentation to you immediately thereafter. The debit should be to Ansbacher Limited Account No.13154602. If there is any problem, please ley me know. Yours sincerely. j d t /a j w L'^' V V ■•«>«• %'«M* ,k A M m tm tfO m Bmry AnOtOmr BoUbv H jC MtreSam P A Bk M7. Ocnd Pleasereply to: Oqpau. M U* W « W h. Phoue (109)94B-4«S3/4 TtiocCPtias 42 RtzvriOtemSqnax^ Dublin 2. Tel:765144/763065 Ear 612035 Rue (Hf) 949-7946 94MM7 22nd June, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness A Mahon Linited, 17 College Green, DUBLIN 2. Dear David, Could you please arrange to have the Australian Dollar equivalent of Stg.£7,233.72 transferred to: State Bank 303 Chesterville Road Moorabin Bast East Bentleigh Melbourne 3165 Victoria • Australia for credit of the Account of • M • _ Patrick J. Clonan Account Ho.2 6 1 -8 6 2 8 5 - 9 0 . The debit should be to Ansbacher Linited Account No. 13 1 5 4 6 0 2 . In due course please advise amount of Australian Dollars transferred. Tours sincerely, J.D» Traynor. jdt /ajw * f is , 76 9 - t - / Appendix XV (16) Mr Kevin Collery & Mrs Kathleen Collery 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Kevin Collery & Mrs Kathleen Collery. a) Extract of interview with Padraig Collery of 6 June 2000. b) Letter of 4 September 2000 from Sheehan & Company enclosing documentation regarding memorandum account A A 30 K: Letter of 10 November 1995 from Irish Permanent with enclosures to Kathleen Collery. Letter of 4 December 1995 from Irish Progressive Life Assurance Company Ltd to Kathleen Collery. Letter of 4 December 1995 from Irish Life to Kathleen Collery. Statements of account - Darsley Nominees Ltd. Statement of memorandum account A A 30 K. Cayman National Bank cheque in the amount of £176,802.48 in favour of Mrs K Collery. c) Letter of 16 October 2000 to Inspectors from Padraig Collery. t » 7 Q 54 who appeared to have accounts in Ansbacher cayman or 3 10 one of its related companies. Perhaps, Mr. Collery, you might just tell us what that statement precisely 11 is? 13 55 14 ^ ' This is a schedule of names and details of people 8 13 ■ Q. A. Sorry, this page (Exhibit 4) ? Q. Yes? A. This is one of a number of pages which I prepared 15 for you to assist you arising from the question that 16 the Honourable Judge asked me at a previous meeting 17 to,, as fax as possible, give him any details that 18 X had either in documentation form or I .could 19 recollect for individuals and to indicate where the 20 accounts were held and if they were trust held for 21 those individuals to the best of my knowledge and 22 that I have endeavoured to do together with the 23 addresses for the individuals also. 24 56 Q. 25 Collery, which I take it is your own entry? 26 27 Midway down the page there is. a Mr. D.P. 57 A. It is indeed, yes.. Q. underneath that, there is a .Mrs. K. Collery. 28 you throw any light on that? 29 whom you are related? 16 Can Is that someone to 1 2 58 3 4 59 A. It is indeed, that is ray mother's account. Q. This is your mother's account? A. It is, yes. Q. I see. 5 Do you know when this account was opened, Mr. Collery? 6 A. Again I think it was initially with a small amount 7 in the early 1990s and then subsequently in 1995/96 a additional funds were added to the account. 9 60 Q. 10 Collery? 11 12 61 13 14 Who is the beneficial owner of this account, Mr. 62 15 A. My mother. Q. Your mother is? A. Yes. Q. I see. A. I am pleased to give you any assistance and records 16 on that. 17 she has been seriously ill for some months at the 18 19 beginning of this year but she is well again, if • * J# there is any help you wish to have on that account, 20 I will be pleased to provide it to you. 21 63 Q. My mother lives in the West of Ireland Would it be correct to assume that you have provided 22 her with assistance in terms of the operation of 23 that account? 24 25 26 64 A. That is indeed correct, yes. Q. May I just ask what "K" stands for? A. Kathleen. S h e e h a n & C o m p a n y S O L I C I T O R S 1CLA1I STlfIT »»»«» »• I rn, TtLCFAX »l tin n r , »«• * o u » »>*i JPS/DC/ o • . *t ii 4* September2000 Mary Cummins Solicitor to the Inspectors To Ansbacher Cayman Ltd 3* Floor Trident House Blackrock Co. Dublin RE: Our Client: Mr. PadraigCollery Dear Ms. Cummins. Further to your letter o f the 3rd August addressed to our client we now enclose documentation which we trust is what you require. It is our clients recollection that you sought document} relating to the proof yon need to confirm Oat the funds received in memorandum account N o. AA 30 K belong to Kathleen Collery and not any other person. If there are any further queries in this regard please let me know. I would advise however that my client is currently away on two weeks vacation. JtttMIAK SHIEUAM GN AlNN K AK8RN t t . C . l . , »*»»»C. COLKIT MKL H » C USOW » - S t . B .L .» „ C K I U I I CL IA R Y U .A .O I* DOLOKKI C H « H VAN D l l l i l t L I . I . CONSULTANT 6 A » * « T T 4 H I I H A H » .C .L . L L .B . II.I. O'Klirrt I I.C .I... • ( Mrs KrtMssn Collsry Account Transactions IrishPounds Amounts IWf MayW D W9 6 Detf95 25,12227 4,000.00 Document'A' Part£4,800 7? PmtCtiqNoS Document's* Document *0' Document D* Document ■E' •1,000.00 9,516.79 29,688X0 50,892.44 28.799.57 79,602.01 M Data 92 17/07/95 27/11/95 18/01/96 W h M i m m m Lodgements owe 23,81823 4,130.00 20,700.00 30,000.00 2,160.63 27.873.09 624.00 930.00 2,65924 1,040.00 817.50 30,000.00 4.579.M H L 25.12227 4,000.00 20.000.00 28,700.00 2,077.53 26.800.00 800.00 895.00 2,556.66 1,000.00 500.00 28,846.15 4.4QQ.QQ 148*487.91 owe 149,028.89 CqpiMSun NOV95 -2.040.00 -2,000.00 -4,040.00 O m f 9 2 MchMun/Sspm Dstf93 Mch*94 June*94 Sepf94 Dec’M Mdf95 JurnW 8epT95 DecttS MelTO JunaT96 seproe Detf98 M ch*B7 June'S? A ' Sepf87 Dectt7 Mch*98 JulyTO 31/7/96-20/7/99 Total 1.028.32 318.71 305.54 306.88 313.92 317.68 335.83 327.91 363.50 459.31 1.394.32 1,879.87 1,925.48 1,949.75 1,931.40 1,976.94 2,023.62 2,026.81 2.052.07 2.785.43 7.348.08 31,813.79 31,813.79 178,80148 Account W n - f a n r f AOOOI W 2021024 IBP COLLERY KATHLEEN 11/04/00 CAPITAL ACCOUNT 9:21:13 .. 8*1 Value 8U M 01 _ 31DBC81 _ _ OSJANflfi _ 2&IAN82 _ _ 22HAV02 _ _ _ 10JUNS8 I^IUUIIK ow i Narrative Balanoo brought foiwrd RETENTION TAX AT 29.00 % Int. Applied To 31DB081 7.00 CR Baoa Rato 7.00 GROSS 0.80 CR Base Rata 0.80 GROSS EAGLE STAR Q.B CHEQUE GBHERAL INPUT DIRT nrr 0.128 CR Baso Rata 0.120 GROSS 14.75 DR Baao Rata 1 - e x it. Poat Aaount S.OOOR 27.0OCR 23.080.00CR 20,122.271X1 20S.140H 770.00GR Belano* 089.01OR i«ooe.sioR 1# OOO.S1CR S4.8GO.81GR 0.00CR 0.00CR 0.000 + % jktfftUL * y r . ■* SSmI^m—- ii»w — j »— a^nnm— — 1 I I I 937*1 « * » _ _ " 7 T E iF w r a r a y T i i a «o S lt y P C S H E Z n js ZL p ,r ~ — ;__<£» E irfH Z T * ■ § # / « -2? -4 * S k i-Q4tA7 ____ ■ 1 JJI9 / __; « • « __,' -■.- r __; ____ ’ : ---- ------1 c 1 m^mmm !———---- c .... c : VIRISHPERMANENT* MRS KATHLEEN COLLCKY COOLANEY CX)SLIGO. OurRef AM/MC/SLIQO 10thNovember 1995 JRg: Accotatinumber2365803310 * DearMrs Colkiy, Irefbrtoyourrecentvisittothisofficeinrelationtotheabovenumberedaccount Inow enclose herewithchequeinthesumof£29,6M.40inrespectofatotalwithdrawals*requested,also pleesefindenclosedpassbookforyourrecords. • ' Trtistmgthisisborder. . Thankingyou. Yours Hocerdy, i * / f j * . / / L y t f i -7 AldanP Murray BRANCH MANAGER ■ J# . JL r r ' usftr/ 9f , w - & ■ 4RZ.fl 961.2» 979.54 •531.94 505.45 451.J4 408.2? 22R.8S \ S3.3.% C'IIS 1 a 30/0 Ult mNTEMI m s r CREDIT a 31/12/92 SOI 93S INTEREST CREDIT 30/04/93 SOI IK 1/12/93 sot MS « 3 10/04/94 SOI 935 7 3 1/12/94 sot iM 30/04/95 SOI ■Ur 4 10/11/93 SOI ! w 10/11/95 501 :lu INTEREST CREDIT INTEREST CRSBIT INTEREST CREtlT INTEREST CREDIT INTtREST CREDIT X INTEREST CREDIT ,i rOTAt CH« DDL A moa.w I II i“ * IJ ’w M 1t I •MZ&40S.7? : i M*Z74R5.31 4 t MIZB017.27 • > wazesz2.90 >**28974.26 . 7 ■>129439.55 •M29A80.40 • lffflMSO»QO 10 11 ta ia “7 «\ A . It ' it j « \1 ^ . a" ■■ • j* Si^tUSM ecccyv* m m m m rJSlM iU LdL t '**£»' vS'h*: u;s-! i ’s ■ toWNo. j 662266 *_ Hhn mi wiM^f tfdmIm mtm __ MdaoftfwfcMfcmm. jiBSH PROGRESSIVE L;CH - 3 5 'w=/V;C£ CC--.FANY LIM ITED AH WOCPCNOEKT COMRMfT WdtflN MSH PBRMAMNT 8R00P s m a u r ra n n s & c o h tc d u tiil Mrs Kathleen Collery Codaney Co Sligo BE: P O L IC Y MO. 01182381/9 L I F E ASSURED KathlMD Collar? G R A B T E B (S ) Xathleen Collery Full surrender cheque for <50892.44 Is enclosed 11? I I ID VII! 8 I A I I M 1 I I /*N ' CodM i N l ■ Dm Bu i I m It u ■ Top Up ' AUTHORISED OFFICIAL: * m SUR ■ F u ll Surramtor M > P a rtia l Surrender JUNEGAIBRATTH SHO o r n o ' ■ S n itch Out SHZ o r. SBI • Sw itch In DATE 40eeember, 1886 ’ Irtrt P ro g re u to U ta Assurance Com pany IjhL I M U M I h ll M I C l M ^ uwvMXNyxraK OuUnllratand ' T«M w m OI 7042000 Fix017041900 I r is h L ife Private and confidential Policy: Investment Bond Mg. Kathleen Collery Coolaney Co Sligo Policy no: 2707099 07 - /— V .. * U£e(s) coveted: Kathleen Collery V.V A ' 04 December 1995 a v4 C h u m no: 384105 Dear M s Colleiy Policy proceeds I a m pleased to send you your cheque for £28,799J 7 . This isdie cash value of yodr policy. . Thanlc you for choosing Irish Life and I hope that you will do business with us again should the opportnnityarise. Ifyou hare any ’ questions, just call m e on die number above. Yours sincerely . . John Moloney * • . •;»" . -j ,♦ •• *•V s * . /* ;I ;*.* t*t.4»g,f*££•* '•- ;* .*- • .> * ♦“V ' • r * •'* \ _ ’ DATC 1995 .«*•••3202 3702 1302 £702 £103 i1304 1105 1900 2106 £206 2007 *707 2807 CREDIT DEBIT PARTICULARS -AST LEDGER .1900 DARSLEY NOH LTD ✓C‘ ACCOUNT NUMBER 5703850'. STATEMENT * DUE 43EP1995 CODE M SPAN 1 DAY 4 ST AT 7 PRINT 4AUG1995 3A DAPOLCY NOMINEES LlMITCD CURRENT ACCOUNT balance * 0.00 BALANCE. rOPWARD -0D8MENT „ . • itD STAMP DUTY :»COUE. 7G31 :HEOUE. 7632 "EES*DETAILS ATTACHED 2HEQUE. 7632 2HEQUE. 7634 rEES-DETAILS ATTACHEE INTEREST :x p r e s s w *o s t LODG 3HEQUE. 7035 :XPRE39^P0CT LODG 3HE0UE' 7637 DHEOUE. 763C T O T R R A L ITEM<0) TEE • . 0.70 660.OC 330.OC 4.7 S 330. OC 1650.OC 4.16 4.00 * 800.OC 7750. OC 7750.OC 3.65 2970.OC .2370.00 2969.30 2309.30 1979.30 1974.51 1644.51 . 5.49 00 13.65 OC '4800. OC ' ' { 47Q6.3S r 3986.35 11500.0C 15486.35 7736.35 . 17.30 OD SUBTOTAL . DARSLEY NOMINEES LIMITED CURRENT ACCOUNT DATE PARTICULARS JLAST LEDGER TODAY 1995 2807 (BALANCE FORWARD E4Q8M 3HEQUE BK-QOU.DUTY DE 3A DARSLEY NOM LTD sC ACCOUNT NUMBER 57038501 8TATEMENT* DUE 4SEP1995 CODE M SPAN 1 DAY 4 C ' STAT 7 PRINT 4AU61995 DEBIT 3.5C BALANCE 17.30 OE 20.80 OE DARS jlC Y current NOMINEES LIMITED ACCOUNT 3A l I DCBIT PARTICULARS DATE > I.AST LEDGER 24AUGt995j 1995 >408 IBALANCE rORWARD »508C :XP*C8S/P03T LODG 38D9C SHEfiUE.* 763* ItETEftRAL ITEHCS>-rCE p W 50MPANY SEARCH i809F'EES-DETAIL ATTACHED ; I[NTEREST &939C :KPR£SS/POST u ODG 763S H01QE JHEQUE *.3»GE 3IR0 CREDIT r KtOE 3IR0 CREDIT C2l IECHEQUE 13911C CHEQUE. B4MJ3IRO CREDXT 2&11E31R0 CREDIT 3 0112J>iEQ(JE. 0512C CHEQUE. 2 H I BAl ANCC CREDI' 20.80 49973.20 50000. OQ 24.45 *42.57 2000.oq 7000.1 500.1 57C oq S2C 03 « ! 23CC0, od 480, o di S 5'6 .*gl 29688.i.4Cj I * 4 i ... 150.09 Otf 1849.9! 1419.91 8419.9* 8919.9! 8349.91 7829.91 17346.7C 47035.10 27035.10 26555.10 SUBTOTAL __L DAR8LEY NOMINEES LIMITED CURRENT ACCOUNT DATE OARSLEv NOW LTD ACCOUNT NUMBER 57C38SS' STATEMENTS OUC 4jANA996 CODE ■ SPAK 1 DAY 4 C STA* 11 PR!**? 4QCC«99S PARTICULARS -AST LEDGER 3A DARSLEY NOM LTD sO ACCOUNT "NUMBER 57038501 STATEMENT: DUE 4JAN1996 } CODE n SPAN 1 DAY 4 c‘ ___ 8TAT 11 PRIHT4KC199S DEBIT CREDIT BALANCE TODAY 1995 3512 BALANCE FORWARD 26555.1C j. \. DAROLCY NOMINEES LIMITED CURRENT ACCOUNT DATti PARTICULARS ,AQT LEDGER Q5DCC1995 'l995 3512 lDALANCE r OR WARD 1 1 1 £ r T C 0 DCTAIL3 ATT A O Cl IffNTERCST ICOUC. DfelRO CREDIT • 3A c \ 11 . WCOUE. 12 1 2301 c;t«c q u c . DAR3LEY NOMINEES LIMITED CURRENT ACCOUNT 26^ 55.10 • 2.tS + 2.47 >S O S .1s 1990 7G2G.25 2077.52 371.2: 020.71 20700.03 600.OC 2C000.0C 10 <1G 10.49 3A 112230.74 !02540.30 10C1C9.C7 101540.. 9$ 72240.SG 45440.9C SUBTOTAL DAROLEY NOM LTD ^ ACCOUNT NUMBER 57030501 STATEMENTI DUE 4MAR199G CODE M or-AN 1 DAY A C ctat 13 print ercDigso DCDIT CREDIT ■ BALANCE TODAY 1202 jALANCE TORWARD 2C02J CIIIEOUE. 2002 JplCOUE. 25045.25 104737.20 54075.19 1 1 3 2 3 8 .7 4 ‘ j* PARTICULARS ACT LEDGER 79692.01 095.OC 1000.OC /***s . BALANCE Cl0071 £201 C 3 C Q I C . DATE CREDIT DEDIT 98G2.07 It sue. QLODQMCHT C3CGUC. £1121c c h e q u e . 199G 05011 ICQUC. 0801 CtfCOUC. L OARGLCY NOM i-TD .•< ACCOUNT NUMBER. 57038501 ' STATEMENT* DUE 4MAR199G CODE M TJPAN 1 DAV 4 C STAT 13 PRINT g r E B 199C 15 1C COGDO.CC 500.OC 45440.SG 1GG40.90 10340.9G (/Wo t i l ' J9 ------ j----- -... % a ■ ' r— --- 1 */C —— 1 5% * £b «6 ^ M / a f?r J • * f M 7 t C 4 J L / £ ii lt i n £ f u £ s ys?*p ...... 7 _ / PJr n ^1,2 2 J f h l v* j * / u i u i a l U i U7 ? s i u ? W .... 7 /£. \ 5 K o _ & ....... .. * / ? / m - t ... 7 • / H ? o X . > i ? £ ( » & * e * •? t L / M f i & s ei r l t T f o / L /■ P C 4&V e l . ■ ' ...... » w " * . ■ /y/7H-/W*»3 „ K * «r * n ao at r at _.... •'■v . « if •* M » 1 * j A ” j.: j ■ I I .1 4 C a y m a n N at io nal B a n * L t d . ftwt 453R21 OftANO I Pay against ihh check to iW o n o>**HB. L BHIflT* < 3 c .a .s .K g g F ii7 & a a 2 - - » 4 f lj f torCM 6 f \t U U ■ •1.516 f l # 6 0 * 0 0 0 MS O U l i a a a * j* I X 60-0004T 245 Beech Park Lucan Co Dublin Nonccn Mackcy B.L. 3d Floor Trident House Blackrock Co Dublin 16* October’OO Your Ref: C/COS/NMA C/C13/NM Dear Ms Mackcy, Further to you letter dated 28* September I outline below, to the best o f my recollection, replies to the questions you raised. 1. Mrs Kathleen CoBery (a) During the period I was working in Gafrmcft A Mahon my late father asked me fcr investment advice for his savings and as can be seen, from the documentation o f the 4* September, these his funds were invested in Unit Trust Funds. The first o f these Investments matured in M ayl992. In May 19921 arranged with Mr Traynor to open an Ansbacher Bureau Account in the name o f AA 30 K for the benefit o f my late fa th e r 'N a r ln n im n ih tim (b) (c) (d) (e) (f) -was Issu e d to filrifliftttB th e o p e n in g o f th e a c c o u n t n a r w e re there any agreements between Ansbacher or Hamilton Ross and my parents. Funds were added to the account on two occasions. The initial investment as outlined above and secondly after my lather's death. These dates are outlined in the schedule with the documentation of the 4* September 2000. In the first instance, I gave Mr Traynor the Irish Punt amount outstanding in the Deposit Account in Guinness & Mahon and he in turn gave me instructions to transfer the Sterling Equivalent into AA 30 K. In the second set o f transactions my mother gave me funds to be invested for her, I lodged the Irish Punt cheques as indicated in the documentation o f the 4lhSeptember 2000 and over a period o f time switched the Sterling Equivalent to AA 30 K. If and when my mother required funds from her investment she would have contacted me and I would have arranged the withdrawal o f the fluids from the AA 30 K account The account is closed. The account was closed in July 1999 and the funds repatriated to Ireland for investment in Ireland. I do not have the information as to the name of the account, which received Ac first transfer, but I would expect that it was one o f those listed in your letter. The sccond set o f transfers were transacted as per the documentation o f the 4* September 2000. THE HIGH COURT IN THE MATTER OF THE COM PANIES A C TS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES A C T 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R A A eport of t h e ppointed to ffairs o f A E In s p e c t o r s n q u i r e into t h e nsbacher L (Ca y m a n ) imited Published by Order o f the Court made on 24 June 2002 V o lu m e [4]: A p p e n d ix X V (1 7 ) t o X V (2 9 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (17) Mr Padraig Collery 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Padraig Collery. a) Transcript of Evidence dated 6 June 2000. b) Overview Document prepared by Padraig Collery. c) Unheaded statement of memorandum a/c A/A30,29 January 1988. d) Deposit account withdrawal form of 14 January 1991. e) Schedule of names prepared by Padraig Collery. f) Sample statements of ‘S’ a/c in Ansbacher/Hamilton Ross. g) Illustration by Padraig Collery of parallel Bureau Systems in Hamilton Ross and Ansbacher Cayman Ltd. Avve?dix UNDER OATH ON TUESDAY, 6TH JUNE 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. PADRAIG COLLERY Represented by: MR. JERRY SHEEHAN SHEEHAN & CO CLARE STREET DUBLIN 2 1 FOLLOWS: 2 3 4 5 MR. ROWAN: Good morning once again, Mr. Collery. 6 Let me 7 introduce myself. 8 Inspector is Ms. Mackey. 9 not a court and nor is it a tribunal, it is an I am Paul Rowan and my fellow You will know that this is 10 interview, and if you wish to take counsel from your 11 solicitor, please ask us to stop and we will allow 12 you to do so. 13 to give you some guidance, if he asks us to stop, we 14 will do so to enable that to happen. Similarly, if your solicitor wishes 15 16 We are going to obtain a record of the interview 17 which will be transcribed after the interview, so I 18 would like to ask Ms. Cummins to administer the 19 oath. 20 21 MR. PADRAIG COLLERY, HAVING BEEN SWORN, WAS EXAMINED 22 BY MR. ROWAN, AS FOLLOWS: 23 24 25 26 1 Q. MR. ROWAN: Mr. Collery, just for the purpose of the record, may 27 I refer to your statement which came from your 28 solicitor and to the overview document 29 1)where you explained early on in the document that (Exhibit 1 you have had a substantial career in banking 2 starting in 1968 with Lloyds Bank in London, going 3 on from 1974 to 1989 to being a senior bank official 4 with Guinness & Mahon with particular 5 responsibilities for accounts and computer 6 operations, and from 1989 to the present, you are a 7 manager with Kindle Banking Systems, and that from 8 197 6 to the present, you maintained a memorandum of 9 accounts in respect of Ansbacher Cayman and from 10 1994 to the present, you acted as liaison officers 11 for clients of Ansbacher Cayman and Hamilton Ross 12 Limited until 1995 and thereafter, at present, for 13 Hamilton Ross only. 14 career? 15 A. That is correct. That is a summary of your I suppose "the present" would 16 probably be a slight inaccuracy now in that 17 obviously for Ansbacher I have no connections 18 whatsoever with them and Hamilton Ross, that has 19 been almost all wound up, so I have no connections 20 with them either at this point in time but it would 21 be true to say up to 1995/96. 22 2 Q. 23 A. 24 3 Q. Thank you for your clarification. Right. When you were a bank official with Guinness & Mahon, 25 who were your ordinary bankers at that stage, who 26 did you bank with? 27 A. 28 4 Q. 29 A. As a bank? Your personal banking activities? My own personal bank, with Bank of Ireland, I think, 1 for some time and then I changed my account, I can't 2 remember when, but to AIB, and Allied Irish Bank has 3 been my personal banker since that time. 4 5 Q. Thank you. When you decided to become involved with 5 the services of Ansbacher Cayman, did you take any 6 financial or taxation advice on whether that was an 7 appropriate thing to do from anyone? 8 A. No, I did not. As I recall, it was around the time 9 I was leaving Guinness & Mahon and I seem to recall 10 that it was at the suggestion of Mr. Traynor that I 11 should receive some remuneration for the services 12 that I was giving to him and that he would arrange 13 for funds to be put into an account in the then 14 Bureau system. 15 6 Q. I see, but the particular point I want to establish 16 is that you did not seek external advice from a firm 17 of accountants or tax advisors or anyone about any 18 aspect of it? 19 A. he was advising me. 20 21 7 Q. 24 Thank you. You have a copy of your statement to hand I take it (Exhibit 1)? 22 23 No I did not because I trusted Mr. Traynor in what A. 8 Q. 25 A. 26 9 Q. Of my own? Yes. I do indeed, yes. On page 7, which is the schedule of your statement, 27 (Exhibit 1) you say that -- forgive me, I have some 28 pages on here. 29 statement ? It is the schedule to your 1 A 2 10 Q 3 A 4 11 Q 5 A (Handed). In or around that time, yes. And that lodgments came from fees earned? That is correct in as much that I provided a 6 service, as stated, on many occasions to Mr. Traynor 7 and I believe that I used the word "fee" in that 8 context. 9 12 Q Can I ask that you that pass over to page 47 of our brief? 10 11 A 12 13 Q (Handed) Thank you. This is a copy of a ledger statement around December 13 1987 into January 1988 and can you please describe 14 what that document is (Exhibit 2)? 15 A Yes, this is a copy of the ledger system or the 16 statements that were produced by the Bureau system 17 for A/A30 and the statement in front of us shows an 18 opening balance of £3,677.40 with two credits, one 19 on 13th January for £1,000 and one on 29th January 20 for £125,000. 21 14 Q 22 A What are those credits? You will see a repetition of those throughout the 23 subsequent statements, I think, of about £1,000 or 24 £750 at a later date, which in fact were the monthly 25 fee paid to me for the service which I was providing 26 to Mr. Traynor. 27 So, in or around 1988, you continued to be an 28 employee of Guinness & Mahon? 29 I was an employee of Guinness & Mahon up until 6 1 2 16 Q 3 Yes, and so that you would have been earning your remuneration as an employee? 4 A 5 17 Q At Guinness & Mahon, that is correct. And in addition for the separate service you were 6 providing to Mr. Traynor, you were receiving a fee 7 of £1,000 and £125. 8 difference between those two amounts and how were 9 they calculated? 10 A I can't recall whether it was £125 on a weekly or a monthly basis. 11 What was the essential May I refresh my memory on this (Pause). 12 13 14 I really can't remember the distinction, it is quite 15 some stage back. 16 payment out of College or out of maybe Hamilton 17 Ross. 18 payments, 19 maybe one was Hamilton Ross and that was the two 20 payments coming in there. 21 18 Q 22 A 23 24 There were two entities just making two I seem to recall. One was Ansbacher and Surely Hamilton Ross did not exist in 1988? That is why I used the word "College" prior to that, College/Hamilton Ross. 19 Q 25 So that these were amounts that were credited regularly to your personal deposit account? 26 A 27 20 Q 28 A 29 Either it must be a separate That is correct. Were these amounts that were negotiated by you? They were suggested by Mr. Traynor as an amount that he wished to pay for the services that I offered to him. 1 2 3 May I clarify that even though I was working in 4 Guinness & Mahon at that particular time, of course, 5 Mr. Traynor had left Guinness & Mahon so that is 6 where that differentiation started to occur. 7 21 Q Yes and, in essence, the work that you were doing 8 was being done for Mr. Traynor at a time different 9 from the work you were doing for Guinness & Mahon? 10 A Most definitely yes, it was mostly on a Saturday 11 morning that I was doing the work for Mr. Traynor 12 outside my time of work when I was working in 13 Guinness & Mahon. 14 22 Q 15 A 16 23 Q (Pause). Mr. Collery, I am sorry for the delay. That is quite okay. In your schedule to your statement (Exhibit 1) under 17 point number 2, you list the various aspects of your 18 involvement as a depositor via Guinness & Mahon, and 19 then at point number 3 you answer the question "No". 20 21 Now, point number 3 was in respect of the question 22 in our letter in connection with: 23 "The following is a service which the company appears to have offered to Irish residents, that company being Irish Intercontinental Bank." 24 25 26 You say that you did not avail of any of those 27 services ? 28 29 A From Irish Intercontinental Bank? 1 I interpreted that to mean back-to-back loans or 2 that type of thing directly from Irish 3 Intercontinental Bank so I did not avail of any 4 services from Irish Intercontinental Bank. 5 interpretation was misjudged. 6 The questions which related to Guinness & Mahon were 7 the same questions which related to Irish 8 Intercontinental Bank, the difference being that, as 9 you will be aware, some people used or the services Maybe my 10 were provided through Guinness & Mahon, others 11 provided through Irish Intercontinental Bank, and 12 I just wanted to obtain some clarification from you? 13 A 14 26 Q 15 I would be pleased to give those to you. That you did indeed avail of services through Irish Intercontinental Bank? 16 A 17 27 Q (Document handed). You can see that this is a deposit account 18 withdrawal and the heading is "Irish 19 Intercontinental Bank" and you can see it is a 20 withdrawal of £45,650 and been signed, I think, by 21 you. 22 Yes, indeed and I think we have referred, well maybe 23 not in this inquiry, I get confused about the 24 various questions that are asked of me, but this 25 £50,000 does not pertain or directly relate to me 26 personally. That is your signature? 27 28 I think if you view my statement of account, there 29 will not appear a debit of £50,000 on my own 1 personal account. 2 as indeed there would be many other documents where, 3 on behalf of other clients within Ansbacher or 4 Hamilton Ross, I arranged for drawings to be 5 obtained through Irish Intercontinental Bank for 6 their benefit. 7 28 Q 8 9 I think what this may have been, But you did not yourself use Irish Intercontinental Bank for withdrawal purposes? A For this particular one, no, but indeed for my own 10 personal use, as indeed for much smaller amounts, 11 yes I did. 12 29 Q 13 A 14 30 Q You did? Yes . That was the clarification I was seeking because it 15 seemed that way looking at the documents but you had 16 answered the question "No"? 17 A 18 31 Q It was my misinterpretation, I apologise for that. You say in your schedule that periodically you 19 withdrew money through Mr. Traynor. Can you 20 describe what the process was if you wished to 21 withdraw money? 22 I would have made a phone call, or when I would have 23 personally seen him on Saturday morning, I would 24 indicate to him that I wished to withdraw £1,000 if 25 we were going on holidays, because the amounts, as 26 you will see from the statements, are relatively 27 small, and then he would arrange for that cash to be 28 available to me on the following, say, Saturday, and 29 left in my folder to collect. Then he would have 1 processed the transaction, i.e. a letter would have 2 been written, as indeed for all the other clients, 3 to Irish Intercontinental Bank in the latter days 4 requesting a draft payable to the Bank of Ireland 5 and then that draft would have been paid into, say, 6 M i e n a n s or Kentford and cashed in and withdrawn out 7 of that. 8 requesting a draft from Irish Intercontinental Bank 9 in Irish Pounds paid into another account and then 10 11 So it followed the traditional process of drawing out that cash. 32 Q. 12 And the practical application of a withdrawal request was carried out by Mr. Traynor? 13 A. 14 33 Q. 15 A. 16 34 Q. During his lifetime, yes. We will come on to that at a later point? Yes. So, in effect, as a deposit holder, you asked him to 17 withdraw some money, he made the arrangements and 18 then the funds were available to you in whatever way 19 you would ask for them? 20 A. 21 35 Q. 22 A. 23 36 Q. 24 25 That is indeed correct. So that in 1994 Mr. Traynor died? Yes. But is it correct to say that you effected withdrawals yourself before he died? A. From time to time yes I did because if he was on 26 holidays, or if he was not available, clients at 27 that time would have contacted his secretary, Joan 28 Williams, and she sometimes would have contacted me 29 to say, "Look, Mr. X or Miss X require some funds. 1 Mr. Traynor is not available. 2 have those funds available?" and in those 3 circumstances, yes I would have instructed Miss 4 Williams to write the letters, 5 payable for x amount of cash" as indeed the example 6 you have just done there, I believe, is such an 7 example. 8 37 Q. 9 10 Can we arrange to "Please get a draft So you had a specific authority to instruct the withdrawal of funds? A. Yes, Mr. Traynor had delegated authority to me in 11 the event of somebody looking for funds when he was 12 not available, that I could write to Irish 13 Intercontinental Bank, request a draft, and then 14 give it to Miss Williams who in turn would pay it 15 into, I think it was the Bank of Ireland, and then 16 withdraw the cash for that individual. 17 38 Q. 18 19 From what date approximately, Mr. Collery, were you given that authority? A. I would think it was quite early in the 1990s. 20 I think I was a signatory on most of the accounts 21 from quite early in the 1990s. 22 39 Q. 23 24 What was the nature of the circumstances which caused that arrangement to be put in place? A. It was in the event of Mr. Traynor not being 25 available and one of the clients of Ansbacher and 26 latterly of Hamilton Ross wishing to make a 27 withdrawal from their account to facilitate that. 28 29 40 Q. So to enable you to have carried out those responsibilities, you would have had to have a 1 fairly good view of the arrangements as between 2 Ansbacher and individual clients? 3 A. Well, I knew of the arrangements, or obviously I 4 knew that there were transactions happening between 5 clients and Mr. Traynor from the very fact that I 6 was posting the transactions. 7 much of a genius to work that one out and the system 8 was pretty straight forward and visible as you could 9 see it happening and the more or less delegated You didn't have to be 10 authority was that if somebody came and wanted cash, 11 to facilitate them rather than have to wait until he 12 got back if he was away for some time. 13 41 Q. Would you agree with me though that there is perhaps 14 a difference in a banking environment between 15 someone who has front desk responsibility, if I may 16 put it that way, in terms of dealing with customers 17 directly, i.e. accepting lodgments and enabling 18 withdrawals on their behalf, and someone who has the 19 responsibility actually for making sure that the 20 records, the postings and so on are kept up-to-date, 21 because, in essence, where you have the authority to 22 effect withdrawals, you are straddling both of those 23 responsibilities.? 24 A. Yes, I accept that you are straddling both, but my 25 straddling was in exceptional circumstances, in the 26 event of Mr. Traynor not being available, and that 27 was, I hasten to add, very exceptional. 28 29 42 Q. So that in, I think it was, May 1994, Mr. Traynor died? 1 2 43 Q. 3 A. Had that event been signalled in any way? Not at all, it was very, very sudden. I know the 4 media have indicated otherwise but it was, I 5 believe, well I know that he was in the States and 6 indeed was planning to go back to the States later 7 in the year because his son was getting married 8 there and it was co-inciding with the World Cup in 9 the States at that particular time and he was an 10 avid soccer supporter so was looking forward very 11 much to that. 12 had attended some board meeting and called me on 13 I think the Tuesday to say could I meet with him on 14 that Saturday and I said "of course" and then on 15 that Wednesday morning he was found dead in his bed, 16 so it was that sudden. 17 44 Q. 18 19 He had to come back from the States, So the fact that you had the delegated authority was invaluable at that point? A. It was, yes, although there were other people, as 20 you know, from the mandates who had similar 21 authorities to sign on the accounts. 22 just to me alone. 23 45 Q. 24 A. 25 46 Q. 26 27 Who were the others? John Collins, John Furze, Joan Williams and myself. Effectively of course the latter two were here in Ireland? A. 28 29 It was not Of course Mr. Traynor and myself, so there were three in Ireland two in Cayman. 47 Q. Yes, after his death, two in Ireland and two in 1 2 3 48 Q 4 5 Following Mr. Traynor' death, were there any changes to the delegated authority regime put in place? A Yes there was. At what precise time I am not quite 6 sure. 7 on the account as well and again for the very same 8 reason as I was there in the event of my not being 9 available and some people calling me and/or wanting I asked Sam Field-Corbett to be a signatory 10 some funds very urgently, then he would be able to 11 facilitate them and I would do the tidy up 12 afterwards. 13 49 Q I see. You have indicated to us that your deposit 14 account was built up from fees which you earned for 15 providing services to the company. 16 those fees, have you returned those fees to the 17 Revenue Commissioners? 18 A 19 50 Q 20 21 In terms of Yes I have now. And that was done contemporaneously with those being earned? A No they were done, i.e. made my return to the 22 Revenue in relation to those in 1997, the end of 23 1997 . 24 51 Q The question of the interest which on the documents 25 you have provided there was quarterly or half yearly 26 interest earned. 27 contemporaneously to the Revenue? 28 A 29 52 Q Was that returned No, it was returned in the full return of 1997. Thank you. Mr. Collery, did you have a trust of any 1 2 A. No, I didn't. I did not deem it necessary. My few 3 shillings didn't warrant the costly fees that a 4 trust would incur. 5 53 Q. 6 A. 7 54 Q. Did you have a cash backed loan, back-to-back loan? No I did not. (Document handed). This is a schedule of names and details of people 8 who appeared to have accounts in Ansbacher Cayman or 9 one of its related companies. Perhaps, Mr. Collery, 10 you might just tell us what that statement precisely 11 is? 12 A. 13 55 Q. 14 A. Sorry, this page (Exhibit 4)? Yes? This is one of a number of pages which I prepared 15 for you to assist you arising from the question that 16 the Honourable Judge asked me at a previous meeting 17 to, as far as possible, give him any details that 18 I had either in documentation form or I could 19 recollect for individuals and to indicate where the 20 accounts were held and if they were trust held for 21 those individuals to the best of my knowledge and 22 that I have endeavoured to do together with the 23 addresses for the individuals also. 24 56 Q. 25 Midway down the page there is a Mr. D.P. Collery, which I take it is your own entry? 26 A. 27 57 Q. It is indeed, yes. Underneath that, there is a Mrs. K. Collery. 28 you throw any light on that? 29 whom you are related? Can Is that someone to 1 2 58 Q. 3 A. 4 59 Q. 5 6 This is your mother's account? It is, yes. I see. Do you know when this account was opened, Mr. Collery? A. Again I think it was initially with a small amount 7 in the early 1990s and then subsequently in 1995/96 8 additional funds were added to the account. 9 60 Q. 10 Who is the beneficial owner of this account, Mr. Collery? 11 A. 12 61 Q. 13 A. 14 62 Q. 15 A. My mother. Your mother is? Yes. I see. I am pleased to give you any assistance and records 16 on that. 17 she has been seriously ill for some months at the 18 beginning of this year but she is well again. 19 there is any help you wish to have on that account, 20 I will be pleased to provide it to you. 21 63 Q. My mother lives in the West of Ireland and If Would it be correct to assume that you have provided 22 her with assistance in terms of the operation of 23 that account? 24 A. 25 64 Q. 26 A. 27 65 Q. That is indeed correct, yes. May I just ask what "K" stands for? Kathleen. Thank you. Mr. Collery, in keeping with the way we 28 do things, we sometimes at this point have a little 29 break for a cup of tea or coffee and I propose to do 1 that no w a nd we shall p r o v i d e some coffee, 2 f o r you. 3 I a p p r e c i a t e that , 4 66 Q 5 A We will be about as b e f o r e t h a n k you. 10, p e r h a p s at t h e m o s t 15 m i n u t e s . V e r y good. 6 7 A SHORT ADJOURNMENT 8 9 10 THE I N T ERVIEW RESUMED, A F T E R THE SHORT ADJOURNMENT, AS FOLLOWS: 11 12 13 MR. ROWAN: 14 15 Mr. Collery, continue. we will Ms. Mackey w o u l d l i k e t o r a i s e s o m e m a t t e r s w i t h you. 16 17 18 E N D O F E X A M I N A T I O N O F MR. 19 ROWAN 20 21 22 23 24 25 26 27 28 29 P A D R A I G C O L L E R Y B Y MR. 1 2 MACKEY: 3 4 MS MACKEY: 5 Mr. Collery, I just want to have a look at the 6 statements you sent us of the Account A/A30 so Ms. 7 Cummins will give you a copy of them in the order 8 that we have here so I can refer to them by the page 9 numbers ? 10 A 11 12 If you leave them in the order, Mary, it would be easier to take them across 68 Q (Handed). Now, the earlier ones are very poor quality 13 photocopies, Mr. Collery, so I will not go through 14 those because we will give ourselves eye strain? 15 A 16 69 Q They are pretty all straightforward. There are specific things I want to ask you about 17 some of the latter ones that will clarify the 18 questions that I actually have. 19 20 To just get clear in my own mind your evidence this 21 morning, I understand that the monthly figures of 22 £750 and £125 represent fees? 23 A 24 70 Q 25 A 26 27 They do indeed. And you also mentioned a figure of £1,000? In the earlier days I think we were looking at £1, 000 . 71 Q Is the situation that it was just one figure in the 28 early days of £1,0000 and then it became two figures 29 of £750 and £250; is that what happened, or maybe 1 you could direct me to where the £1,000 begins and 2 ends ? 3 I think it became £750 and £125. 4 72 Q 5 A 6 It reduced from £1,000 to £750 and the £125 appears to have continued on. 7 73 Q 8 A 9 10 £125 I should say, not £250? So the £125 ran simultaneously with the £1000? It did indeed, yes and it goes up as far as -- let's have a look and see. 74 Q We can come to where it went up to in the end, I 11 will come to that, but why did the £1,000 reduce to 12 £750? 13 A I don't know. I presume it was the volume of work. 14 You know, I was only coming in -- may I refer to the 15 documents ? 16 75 Q 17 A Yes . This is recollection but I think the facts will bear 18 out. 19 it is such a long time ago, but around 1989/90, as 20 it would appear, it was reduced to £750. 21 happening around that time in my own personal life 22 was that I had moved from Guinness & Mahon and I had 23 gone to Kindle Banking Systems to work. 24 76 Q 25 A The exact circumstances I can't quite recall, What was Yes ? I believe that I would have indicated to Mr. Traynor 26 that starting off a new job, doing this task, 27 obviously was a real problem to me and that I would 28 not be able to give him the time that he might have 29 expected me to give to him. I do know in around 1 that time, we can properly check this out, that £250 2 a month was paid to Miss Williams. 3 used to happen was that Ansbacher continued to pay 4 the £1000 which they had previously done, but 5 instead of £1000 to myself, £750 came to myself and 6 £250 went to Miss Williams for the services she was 7 providing. I think we can check that on, say, 8 "A/A7" . 9 77 Q 10 A 11 78 Q 13 A 14 79 Q 15 I think £250. That would be the balance of the So that was from the time you went to Kindle? In around that time. So from the time you went to Kindle then, you only spent Saturday mornings working for Mr. Traynor? A 17 18 Now, how much did you say to Miss Williams? £1,000 . 12 16 Right. So, I think what Even before that. The volume of work was reducing quite considerably in any case. 80 Q Right. Well, now, if I understand what you say 19 correctly, you say that at that time you would have 20 indicated to Mr. Traynor that because of taking up a 21 new job, which was understandable, you would not be 22 able to devote as much time to it, so to reflect 23 that the fees were reduced? 24 A 25 going to do additional work. 26 81 Q 27 A 28 82 Q 29 Not that they were reduced but Miss Williams was Your fees were reduced? Yes . So that reflected the fact that the amount of work you would be doing would be less because you could 1 devote less time to it? 2 Correct. 3 83 Q 4 A So how much time were you devoting before that? I think the work was such that again it was 5 interspersed between my work and Guinness & Mahon. 6 It was not a confined period of work. 7 the work for him, meeting him during my working day. 8 When I went to Kindle, obviously I was not able to 9 meet him during the working day. 10 84 Q I was doing So in fact what you said earlier this morning would 11 not be absolutely accurate, that when you were in 12 Guinness & Mahon the work you were doing for 13 Ansbacher was outside of the hours of Guinness & 14 Mahon. 15 A That wouldn't be totally correct? No it was quite the opposite. It was within the 16 work of Guinness & Mahon. 17 my employment with Guinness & Mahon. 18 was referring to was the reimbursement whereby up 19 until 1986 and Mr. Traynor was there, it was seen as 20 part of my daily work because Guinness & Mahon, and 21 you will have to look up the records at that time, 22 Ansbacher Guinness Mahon Cayman Trust was a 23 subsidiary of Guinness & Mahon. 24 subsidiary so you were contributing as part of the 25 group in your daily work and then obviously with the 26 sale of Guinness Mahon to Ansbacher, that work was 27 seen as not being a part of the group as it were. 28 85 Q 29 A There were two stages of I think what I So it was seen as a Yes but you were still there at that stage? That is where, in or around that time then I started 1 2 86 Q. 3 A. 4 87 Q. 5 A. 6 88 Q. 7 8 I think that happened around 1987/88. So that was when you began to be reimbursed? In or around that time. But you were still working for Guinness & Mahon at that stage? A. 9 Yes, but obviously I was trying to do less work during my normal working day and more either working 10 11 Just give me roughly the year of that? late in the evenings or working 89 Q. -­ But, as you said a moment ago, it would have 12 occurred during your ordinary working day that you 13 met with Mr. Traynor? 14 A. 15 90 Q. It would indeed, yes. So that when you finally left and went to Kindle, 16 the work naturally had to be done purely outside of 17 working hours? 18 A. 19 91 Q. 20 A. 21 92 Q. Absolutely so. And therefore it became less? It became less. Now again earlier this morning you were explaining 22 to Mr. Rowan the difference, as far as you could 23 recollect it, between the £750 and the £125 and you 24 said that they were two different entities and they 25 were either Hamilton Ross or College. 26 that they could not have been Hamilton Ross in the 27 earlier days because Hamilton Ross was not there. 28 What was your involvement with College? 29 A. It is clear College, as I explained previously, was parallel to 1 Guinness Mahon Cayman Trust and they ran parallel to 2 each other. 3 back and clarify this, or indeed -- I am trying -­ 4 it may have been College or it may have been a fee. 5 I would want to look at a statement of "S" account. 6 It may have been a fee that Mr. Traynor himself was 7 paying me of the £125 and therefore I would want to 8 see is there a debit going through there or it may 9 have been a deduction from the fee that he used to 10 get. 11 thing. 12 93 Q Right. If I may check this out, I will come That is just as I am thinking about the whole Well, now, that gives rise to two questions. 13 First, of all, why would College be paying you a fee 14 and, secondly, why would Mr. Traynor be paying you a 15 fee separately? 16 A 17 I think, while I am thinking about it, it was a fee that Mr. Traynor paid me. 18 94 Q 19 A 20 95 Q 21 A Why would Mr. Traynor be paying you? Because I was doing work for him. When you were doing Ansbacher he was paying you? Well, Mr. Traynor and Ansbacher, it is hard to 22 separate the two of them if you look at the picture 23 in the capacity that he operated in. 24 96 Q I am just wondering what would you be doing 25 differently for him from what you were doing for 26 Ansbacher that would require a separate fee? 27 A Other than I was doing him a favour personally in 28 providing the service for Ansbacher which he was a 29 beneficiary of. 1 97 Q 2 A In the sense that he was availing of services and 3 when he asked for something to be done, copy 4 statements, or whatever, that would have been a 5 personal service to him. 6 98 Q In working for Ansbacher for which you were 7 receiving a fee anyway, Mr. Traynor would have seen 8 that as a personal service to him, would that be 9 correct? 10 A That would be a fair -- part and parcel of the whole 11 package as it were. 12 services. 13 99 Q He was a beneficiary of the Now, however at the beginning you were not clear 14 whether, and you still, I think, are not totally 15 clear, that that is the case? 16 A 17 100 Q I am not totally clear. But you did say that it might have been College. 18 wonder why you thought it might have been College. 19 Did you operate the Bureau system for College? 20 A 21 101 Q Yes I did. And was any arrangement made by College to pay you a 22 fee in the same way that Ansbacher did in relation 23 to that? 24 A I I can't recall. I think it is more likely on 25 reflection now, and I am trying to go back to those 26 particular days, I think it wasn't actually College, 27 I think it actually came from Mr. Traynor. 28 But the fact is that you were doing work for 29 College? 1 A 2 103 Q 3 A I was doing work for College, I was indeed, yes. Was that recognised in any way financially? No, because I think, and again I am thinking of the 4 time span to put it into its proper context, that 5 College would have ceased to exist as an entity 6 around 1987/88. 7 Management or Credit Suisse in or around that time. 8 104 Q 9 10 I think it was sold to Sovereign Ceased to exist as a subsidiary of Guinness Mahon you mean? A It did and any funds that were there either came 11 under the direct control of Sovereign or Credit 12 Suisse and therefore those became direct clients and 13 some funds I do know moved into Guinness & Mahon 14 Cayman Trust, some entities moved across. 15 105 Q If we could just have a look at these statements, 16 Mr. Collery, and if we could go, first, to page 81 17 at the bottom right-hand corner there, and we are 18 into 1991 (Exhibit 5)? 19 A 20 106 Q Okay. Now, there are 3 lodgments there. Could you tell me 21 what they are? They do not seem to be the usual 22 £750 and £125. The first one is £881.78 and it is 23 lodged on 2nd January 1991? 24 A 25 26 (Pause) Yes. I can't, No, I don't recall what that £881 was. 107 Q Right. Can you recall what the next one, lodged on 27 the same date, £5,450 is? 28 not 2nd of the 1st, it is 31st December? 29 A I beg your pardon, it is 1 time, Mr. Traynor had negotiated with Ansbacher that 2 obviously I had given them quite a bit of service 3 from 1978 up to that period and they made some sum 4 lump sum payments to me which is effectively a 5 gratuity for the service I had given in the past 6 because I had now split away from Guinness & Mahon 7 Group and they were payments that he had organised 8 for me. 9 108 Q 10 11 When you say "they were", are you speaking of the two payments there? A I think the two were. The £881.78, I don't have any 12 recollection but those round amounts I believe are 13 two related. 14 109 Q £5,450 and £6,875. They are quite specific amounts 15 for lump sums. 16 It is not just a figure of £5,000 but £5,450? 17 A 18 19 I did not ask the man. He was saying that those sums are available to you. 110 Q Why would they be lodged three days apart instead of in one sum? 20 21 How would they have been calculated? A I would have to, and, again, I can only surmise that 22 Mr. Traynor said, "Look, there has been x amount of 23 sums made available to you. 24 here are the amounts that are due that you can 25 credit your account with". 26 or how it was managed. 27 Your evidence to us this morning is that Mr. Traynor 28 explained to you that these sums were made available 29 to you by Ansbacher as lump sums in payment for your I have arranged it and How he calculated that, I have no knowledge of. 1 2 A. 3 112 Q. 4 A. That is as I understand it. As well as the regular fees? As well as the regular fees and I think there was 5 one other payment, that is why I was looking through 6 that. 7 113 Q. 8 We will be going through them all and we will probably come to it? 9 A. 10 114 Q. 11 A. 12 115 Q. Okay, fine. If we could look next then at page 90 Exhibit 6? Yes. Here we have the £750 and £125 which you explained 13 to us both on 31st October 1991. 14 the end of each month that the fee was paid? 15 A. 16 116 Q. 17 It seemed to be at Yes it was. But on 2nd October of that year we have a lodgment of £1,000 in addition to those two, it appears? 18 A. 19 117 Q. 20 A. 21 118 Q. Yes. What would that represent? I have no recollection of what that is. No recollection. Do you recollect in general 22 because this may save us going through all of these 23 and asking you about each individual lodgement other 24 than the £750 and the £125. 25 sums being lodged apart from your fees? 26 A. 27 28 29 Yes. Do you recollect other The one other sum, I think in general, was the large amount in 1995, was it, £186,000 or something. 119 Q. We will come to that too, but in general were there monies going into the account apart from either 1 2 No. 3 120 Q 4 A 5 121 Q 6 A 7 122 Q 8 Were you making lodgements in other words? No, I think if you look through them. May we look at the specific one and stick with that? Okay. You did not lodge money yourself is what I'm asking you? 9 A 10 123 Q I didn't lodge money, no. You didn't ask Mr. Traynor to put money into the 11 account for you, you didn't pass him a cheque or 12 cash or transfers? 13 A 14 15 No, I didn't have the surplus funds to do that. had three young men who were -­ 124 Q Can we take it that any money that appears there 16 appears either from Ansbacher from Mr. Traynor 17 himself or from perhaps College? 18 A 19 125 Q That is correct, yes. So if this sum of £1,000 on this particular occasion 20 is not part of your monthly fees for October, and 21 I think if we turn back to the previous page we 22 should see your monthly fee for October? 23 A 24 126 Q 25 26 I Correct. It is hard to see from the date whether that is October or September? A 27 I think it is September. Are we talking about page 8 9 (Exhibit 7) . 28 127 Q 29 A We are, yes. It is hard to see the date there. 1 128 Q 2 A 3 129 Q Yes, that is right. And then we have your fees for October, 31st 4 October, on page 90 and we have this sum of £1,000 5 (Exhibit 6)? 6 A 7 130 Q 8 A 9 That is correct. Is that sum then money that came from Ansbacher? It would have come from Ansbacher or I would have said an Ansbacher client or some fee over and above 10 what Mr. Traynor has arranged to pay to me, but it 11 certainly came within the offshore entities I would 12 have said. 13 131 Q 14 15 Right. When you say "an Ansbacher client", what do you mean? A If there were some transfers or something that was 16 being done for the client within the Bureau system, 17 that if he charged a fee, Mr. Traynor, for cash 18 drawn or some services given to a customer, then 19 that may well have been a payment to them from them 20 rather. 21 132 Q As a fee? 22 A As a fee. 23 133 Q 24 25 personally? A 26 It would be a payment for Mr. Traynor which Mr. Traynor has redirected in there. 27 134 Q 28 A 29 But not in the payment to the bank, a payment to you Why would he redirect it to your personal account? Because if I had organised cash or something that went down or had organised over time some services 1 for him, then he would have deemed that that was a 2 fee due to me. 3 135 Q 4 5 A 136 Q It is an isolated case. I just wondered why you think it might be that reason? A 10 11 Is that something that No, because we will see this is only one payment that is in there. 8 9 Used that to happen? happened? 6 7 I don't recollect. I am only giving that as an opinion that may have happened, 137 Q I don't know. So what you are saying is that it may have occurred 12 that a client may have been rendered some services 13 by Ansbacher for which Mr. Traynor would have 14 charged him a fee? 15 A 16 138 Q 17 A 18 139 Q 19 A Correct. He would pay that fee to Mr. Traynor? He would have charged the fee to the customer. Yes but the customer would have paid it to? Mr. Traynor presumably and then Mr. Traynor, at his 20 discretion, would have said, 21 some work on this in arranging whatever services 22 that client got and here is £1,000 for doing that 23 work over and above your normal £750 and £125 a 24 month", or it may have been an additional fee that 25 Mr. Traynor just paid me. 26 1991 there was a lot happening going on around that 27 period whereby funds were moving from Guinness & 28 Mahon to Irish Intercontinental Bank. 29 remember all of that? "Yes, you have done You must recall around Do you 1 140 Q 2 A 3 4 So there was a lot of work involved and a lot of time taken up there. 141 Q I just want to get clear in my mind. You are saying 5 that this may have happened but presumably it 6 happened at some stage or you would imagine that it 7 might have happened, would that be correct? 8 A 9 142 Q Absolutely. So there must have been on some occasion, it may not 10 have been this particular occasion, but there must 11 have been an occasion or occasions on which this 12 type of transaction that you have just described 13 happened where a fee was charged by Mr. Traynor to a 14 client who paid the fee to Mr. Traynor and Mr. 15 Traynor in his discretion, because of work you would 16 have done in relation to that client, passed it to 17 your account? 18 A 19 143 Q 20 A 21 144 Q 22 23 That would actually have happened at that time? Yes . Whether on that occasion or some other, it was something that happened? A 24 25 Account, yes. Yes, and I think 1991 was the time there was a lot of work going on there for various clients. 145 Q So that may have been that or it may have been a fee 26 from Mr. Traynor himself in recognition of your 27 services ? 28 A 29 146 Q Yes . 1 2 Again we are just 2 months later. 3 looking at was October. 4 December, and again we have the same three amounts. 5 We have the £750 and the £125 which you have 6 explained but again we have £1,000, so 2 months 7 later we have an identical fee? 8 A 9 148 Q 10 A The one we were We are now looking at Yes . So it begins to look as if it is -­ As I say, around 1991 it would not surprise me for 11 the amount of work that I had been doing at that 12 stage that there was an additional fee. 13 149 Q So, again, that may be the same. It may be a fee 14 from a client or you can't be more specific that it 15 was quite specifically one or the other? 16 A I can't recall precisely what it was or how the in - 17 payment was initiated but I do know that in 1991/92, 18 as we know, the funds transferred from Cayman. 19 There was a lot of going to Irish Intercontinental 20 Bank explaining how the accounts had to be opened, 21 arranging for the funds to transfer over around that 22 period. 23 150 Q 24 A 25 26 They could have been that? And the setting up of Hamilton Ross and all of that appeared around that time. 151 Q Fine. We see the same thing happening again at page 27 95 which is in April, 28 October, December, April and again we have this 29 payment in April of £1,000 in April. (Exhibit 9) so we have had So your 1 evidence, 2 It will be the same, yes. 3 152 Q Okay. I take it, will be the same? If we move along a bit to page 109 and we are 4 now into 1993 and here we are looking at the 5 statement for May 1993 and we have the usual £750 6 and £125 but we also have a lodgement at the 7 beginning of May for £5,000. 8 do your recollect 9 A 10 Again, What do you think or (Exhibit 10)? it would have been a payment made to me by Mr. Traynor. 11 153 Q 12 A 13 154 Q 14 A 15 155 Q By Mr. Traynor or Ansbacher? Correct. Over and above your normal fee? Over and above my normal fees, yes. In respect of payments such as fees from Mr. Traynor 16 over and above your normal fees or lump sum 17 gratuities like the ones you have described to us 18 there on the first page, would they at that time 19 have been declared to tax? 20 A 21 22 No, they would not but they were subsequently in 1997 declared. 156 Q 23 If we look at page 114, we are into October 1993 (Exhibit 11). 24 A 25 157 Q 26 A 27 158 Q Yes . And we have a lodgement of £2,000? That would be similar. Similar, okay. May I just stop going ahead there 28 for a minute and go slightly backwards to page 110 29 and 111 (Exhibit 12 and 13). 1 2 159 Q If we look at page 110 first, we see the usual two 3 sums of £125 and £750. 4 (Exhibit 12). 5 A 6 160 Q This is now June 1993 Yes . But then if we look at page 111 for July, we find 7 there is only the £750, the £125 stops and we do 8 not, in fact, see it any more after that at all 9 (Exhibit 13). I wonder if that might assist you to 10 remember what it was because it stops in July 1993, 11 the £125, and it never reappears? 12 A As I say, in recollection I think the £125 was a 13 payment by Mr. Traynor himself. 14 have moved on a number of years. 15 substantial amount of these accounts have been 16 closed over the years. 17 have dramatically reduced and the amount of work to 18 be done has again been reduced although you still 19 have to go in on a Saturday morning. Again in 1993 we Quite a The volume of transactions 20 161 Q And the £1,000 still appears from time to time? 21 A It probably does, I don't recall. So whatever 22 rearranging of fees or whatever, maybe he himself 23 was receiving the £125 was stopped by him and we are 24 left with the £750. 25 162 Q Which is certainly the Ansbacher payment? 26 Which is the Ansbacher. I think if you look at the 27 Ansbacher you will see £1,000 coming out there on 28 monthly basis and it is split £750 to myself and 29 £250 to Joan Williams. 1 In that regard, if we could move on to page 130 2 (Exhibit 14), and we are into 1995. 3 going back again but I just want to clarify this 4 particular point. 5 and we see the £750 as usual? 6 A 7 164 Q We will be We are into February 1995 there Yes . But if we turn over to the next page, March, the 8 £750 has disappeared and in fact it does not 9 reappear after that (Exhibit 15). So your fee from 10 Ansbacher, which at this stage we are talking about 11 how much you lost in fact, that is another thing I 12 will try to clarify in a moment, but it stops at 13 that point anyway, the £750? 14 A 15 165 Q 16 A 17 16 6 Q 18 A 19 167 Q 20 A 21 168 Q No, I do not think that would be strictly true. Would it not? No. I do not think I saw it again after that? You did not see the £750 but you did see the £1,000. Not for months certainly? May be not but -­ Certainly not up to the end of 1995. We see other 22 figures but perhaps you might be able to explain 23 those as we go along? 24 A 25 169 Q I think if you go to page 142 (Exhibit 16). Yes, that is 1996 we are into there? 26 For April 1996 you see a lodgement there of £12,000 27 which is Ansbacher Cayman Limited payments. 28 that, if I recall, correctly, Mr. Traynor had died 29 at this stage and there was some -- obviously I think 1 whether this payment should be made or should not be 2 paid around that time. 3 170 Q 4 A That represented the past year? I believe it did. Then if you look to May 1996 you 5 see the £1,000, April/May 1996 on page 143 (Exhibit 6 17) . 7 171 Q 8 A 9 172 Q So that was the back-dated payment? That would be correct. That is 1993 then. In 1995 it stopped after Mr. 10 Traynor's death and therefore for that whole year 11 you did not receive your regular monthly fee but a 12 sum of £12,000 was lodged in April 1996 representing 13 back-dated payments? 14 A 15 173 Q Correct, yes. That clarifies that. If we could go back to where 16 we were and if we could look at page 118 17 18). 18 have the £750 but we also have a lodgement of 19 £1,968.69 on 24th January? 20 A 21 174 Q 22 A 23 175 Q 24 A 25 176 Q (Exhibit We are now into the beginning of 1994 and we I have no idea what that represents. You can't recollect? No. Fine, we will move on from that. Page 125? Yes . This is September 1994 and we have the £750 and you 26 have a lodgement of £3,000 on the same day? 27 I can only assume that that is a fee that I charged 28 somebody because Mr. Traynor has now died at this 29 point in time and that I charged a fee to somebody 1 and credited it in there to my account either in 2 Hamilton Ross. 3 Ross because obviously I had no authority over 4 Guinness Mahon Cayman Trust. 5 Right, so you might have charged a client of 6 Hamilton Ross a fee in respect of services? 7 A It most likely would be in Hamilton In conjunction with Mr. Furze I would have said, 8 "Look, I had to do this service for client X and I 9 am going to charge him £3,000 for doing that", 10 because, as I stated in evidence, at this point in 11 time I had no intentions of wanting to carry on this 12 business and anyone that was availing it was paying 13 a premium rate. 14 178 Q 15 So this would be a fee charged by Hamilton Ross to the client? 16 A 17 179 Q 18 A I gave the services to Hamilton Ross's client. On behalf of Hamilton Ross? On behalf of Hamilton Ross and I, as the provider of 19 that service, said, "Look, this is going to cost 20 £3,000 to the client" and charged his account in 21 Hamilton Ross I presume. 22 through the records to ascertain that. 23 180 Q 24 A We will have to go back It became a payment to you rather than the company? Well, I provided the service so in providing the 25 service through Hamilton Ross to the client, yes it 26 became a payment to me. 27 181 Q I see. I think I understand these but just for the 28 record, page 127 we see what I take to be expenses 29 in relation to your services (Exhibit 19)? 1 Yes, the agreement was with Ansbacher. 2 point in time, obviously I am making phone calls for 3 authorisations to do certain things across the 4 accounts of Hamilton Ross and indeed Ansbacher to 5 John Furze in Cayman. 6 fairly monthly basis is look at my telephone bill 7 and see what fees were applicable to International 8 calls. 9 packages and incurring other expenses, 10 11 182 Q Obviously I would have been sending him DHL so these are Now, at that stage Hamilton Ross was separate from Ansbacher at this stage? A 14 15 what I used to do on a the expenses being reclaimed. 12 13 So At this Very much so, yes. From 1992 onwards we have Hamilton Ross separately. 183 Q So in relation to the Ansbacher expenses that are 16 described there for Ansbacher, who would they have 17 been charged to, or how would you be incurring any 18 expenses for Ansbacher? 19 A How John Furze has accounted for them, you know 20 184 Q Really I am trying to find out -- you were then 21 22 working for Hamilton Ross? A I was working for both, Hamilton Ross and Ansbacher. 23 I never made a distinction. 24 thing. 25 entity. 26 185 Q 27 A 28 186 Q 29 -­ Hindsight is a great At that point in time they were the same They were being managed through John Furze. They were still the same entity at that stage? Yes, and John Furze was in Ansbacher in Cayman. So your account which is as described there as Hamilton Ross was an account in Hamilton Ross in 1 2 These are the grey areas of where they were managed 3 at that point in time. 4 we have done over the periods is that Hamilton Ross 5 is a company managed by John Furze and that company 6 would have been managed by him whilst he was within 7 Henry Ansbacher, working within Ansbacher, but it 8 had its own bank account of course, as we know, with 9 Irish Intercontinental Bank. 10 187 Q 11 A I believe from the analysis Yes ? When he then moved from Ansbacher to set up his own 12 company then Hamilton Ross obviously moved with him 13 in 1995/96. 14 188 Q So at this stage in 1994 the expenses that you would 15 be incurring in relation to Ansbacher were, as far 16 as you were concerned, the same expenses you would 17 be incurring in relation to Hamilton Ross? 18 A 19 189 Q A phone to one or the other was to John Furze, yes. Again page 129 I see again these are Ansbacher 20 (Exhibit 20) telephone bill, dinner/lunch. 21 were expenses incurred on behalf of either 22 Ansbacher/Hamilton Ross? 23 A 24 190 Q 25 That is correct, yes. What was the exact date in 1995 when Hamilton Ross moved from Ansbacher with Mr. Furze? 26 A 27 191 Q 28 A 29 192 Q These When Mr. Furze moved from Ansbacher? Yes . I think it was some time in 1996. 1996? 1 1996 he moved, yes, because my recollection is that 2 he had set up this new company and he was about a 3 year out of there and then he died in late 1997. 4 Yes. 5 situation in which, as far as you were concerned, 6 the work that you were doing for Hamilton Ross was 7 the work you were doing for Ansbacher and vice 8 versa? 9 A 10 194 Q 11 A 12 195 Q So what we are looking at at this stage is a Absolutely. Can we turn now to page 130 (Exhibit 14)? Yes . Here we are four lodgements. We have the usual 13 £750, this is February 1995. Then we have ME or Me, 14 I don't know which? 15 A 16 196 Q 17 A 18 197 Q Or a mistype! £300 a small credit? I can't recall what that is. Then we have a reverse entry. It starts off as 19 being a debit, Corporate Partners, and then it is 20 reversed and it becomes a credit? 21 A 22 198 Q Correct. What was that? It seems first to have been debited 23 to your account and then about 2 weeks later this 24 sum of £55,000 is credited? 25 A 26 Yes. A very good friend of mine who at one stage worked in Guinness & Mahon, Moize Dawood-Ketty? 27 199 Q 28 A 29 200 Q Sorry? Moize Dawood-Ketty. M-O-I-S-E? 1 A 2 201 Q 3 A 4 M-O-I-Z-E D-A-W-O-O-D-K-E-T-T-Y. A former Guinness & Mahon person did you say? Yes, he might have been known in Guinness & Mahon as Moize Dawood-Boye. 5 202 Q 6 A How do you spell the Boye, B-O-Y-E, is it? I think so, yes. He emigrated to the United States 7 and he was an investment advisor in foreign currency 8 dealing and then left the States and came back and 9 set up a business in Paris as an investment advisor 10 to major international clients. 11 he had a business somewhere in the middle of Paris 12 whereby he sold gifts and that type of thing to 13 tourists. 14 I understand it became available at very short 15 notice and he had just recently moved to Paris at 16 that point and he wished to buy that to expand his 17 business there. 18 way in which I could arrange a loan for him, say, 19 through my connections either here in Dublin or 20 through Ansbacher. 21 203 Q 22 A At the same time A property next door to him, as He phoned me to say was there any Yes? The amount was £110,000 and I said, after some 23 investigations with Mr. Furze etc., it was not 24 possible to do anything at such short notice in 25 Cayman, and what I did do, because I trusted him, 26 I said I would be prepared to lend him the £110,000. 27 204 Q 28 A 29 You personally? Me personally in my own personal capacity. Obviously from the statement there I did not have 1 £110,000 so I approached Mr. Sam Field-Corbett and 2 he agreed to go the other half. 3 £55,000 each. 4 Paris he did manage to get funding in time for the 5 venture and the purchase of the property and 6 therefore the £55,000 was returned. 7 205 Q 8 A 9 206 Q 10 11 A Within 2 weeks? Yes . And Corporate Partners is the name for yourself and No, it is a Sam Field-Corbett company or I believe he has some connections with it in the UK. 207 Q 14 15 It then transpired that in fact in Sam Field-Corbett; is that right? 12 13 So we both lent And why does that name appear there rather than the name of Mr. Dawood? A Because that is who the payment was made to. 16 I think if you look at the transfers, it went out 17 through IIB. 18 Partnerships in the UK. 19 208 Q 20 21 It would So you actually paid the money to Sam Field-Corbett's company? A And it in turn was holding those funds to pay 22 onwards. 23 just returned them back. 24 209 Q 25 Thank you. In fact it never paid them onwards, it If we could look at page 132 (Exhibit 21) ? 26 A 27 210 Q 28 29 have gone to Corporate Yes . We see two lodgements. stopped, I think, yes? A This is after the £750 had 1 I think you explained that but the actual monthly 2 payment has stopped at that point, but here we see 3 two lodgements in April 1995. 4 the other is £3,750. 5 simply says "lodged". 6 A One is £35,000 and First of all the £35,000 What would that relate to? I think I would have to check from where that came 7 from but I think that may have been an agreement 8 between myself and John Furze for Hamilton Ross, 9 this was my services for the year and all, the work 10 that I had done for him since Mr. Traynor died, and 11 I think that would have come out of a suspense 12 account. I think it was the split of a suspense 13 account if I remember correctly. 14 212 Q 15 A 16 213 Q 17 A A split of a suspense account? Yes . Between you and him? Well, I think if we look at Mr. Sam Field-Corbett 18 I think there may have been a similar account 19 contained in his account. 20 214 Q I see, so it would have been a split of the suspense 21 account between you and Mr. 22 are right about this? 23 A 24 215 Q 25 A 26 216 Q 27 Field-Corbett if you If I am right about this. Would you be able to check that out for us? Yes we can. When I say "check it out", I mean would you be able to confirm that? 28 A 29 217 Q Yes I will of course. Because as I understand your evidence at the moment, 44 1 you think that is what it is but you are not 2 certain? 3 Yes, I will check the records. 4 218 Q 5 A In relation to Hamilton Ross? In relation to Hamilton Ross because Ansbacher has 6 almost ceased at this point. 7 process of their funds being moved back out of 8 Dublin etc. quite substantially at this point in 9 time . 10 219 Q They are in the Although you have explained to me up to this point 11 in your own eyes what you were doing for Hamilton 12 Ross you were doing for Ansbacher? 13 A 14 220 Q Yes. They were intermeshed up to 1996. But if you are correct about this in Mr. Furze's 15 view, this is separate from Ansbacher; is that 16 right ? 17 A In this because Hamilton Ross was running -- the 18 monies came out of Hamilton Ross but it was fees or 19 services that were done for both because there was a 20 huge tidy up operation and to get all the affairs 21 sorted out after Mr. Traynor's death in 1994/95. 22 221 Q 23 So in fact it could have been fees in respect of both Hamilton Ross and Ansbacher? 24 A 25 222 Q 26 A You could interpret them as that, yes. And then the £3,750 on the same date? I think this was money I must have given to Sam 27 Field-Corbett for some reason or another, but 28 I think you will find a debit for £3,750 in an A/C 29 account so it was a transfer of monies from his 1 2 223 Q A transfer from Sam Field-Corbett's account. 3 this would have been a repayment from Mr. 4 Field-Corbett to you? 5 A 6 224 Q 7 It was, it was repayment, yes. So this is money differently to anything we have looked at so far, it is not fees? 8 A 9 225 Q No. And the monies that you would have given him 10 originally, would they have come out of your 11 Ansbacher account? 12 So A 13 No I do not think so. I think they would have come out of my domestic. 14 226 Q 15 A 16 227 Q So this is an additional lodgement to your account? It is . Page 133 I think there we have expenses again and 17 they speak for themselves, would that be correct, 18 telephone charges 19 A 20 228 Q 21 A 22 (Exhibit 22)? That is correct, yes. Page 134, ACL £2,000 (Exhibit 23)? I would imagine that that is probably May and June's £1, 000 . 23 229 Q 24 A 25 230 Q 26 ACL stands for? Ansbacher Cayman Limited. So Ansbacher Cayman limited as opposed to Hamilton Ross is still paying you the fees in 27 A 28 231 Q 29 A 1995 . Sorry 1995? June 1996? 1 That payment from Ansbacher falls on its own in the 2 middle of that year. 3 had stopped and at the end of which you got the 4 £12,000 there, the back payments? 5 A 6 233 Q 7 8 A But this £2000 leaps suddenly into the middle of I agree with you on that, but ACL, that is the allocation that you see later on under ACT. 234 Q 11 It represents payment from Ansbacher anyway whatever it is? 12 A 13 235 Q 14 A 15 236 Q 16 It does, yes. Page 140 (Exhibit 24)? Yes . I can see the first one there again is expenses on 8th January 1996, £300? 17 A 18 237 Q Correct. Down at the bottom then we have a figure of £5,000 lodged on 18th January 1996? 19 20 Yes, it does. that year? 9 10 That is the year when the £750 A Yes I can only believe that that is a fee agreed 21 with Mr. 22 would have been a fee. 23 238 Q 24 A 25 239 Q Furze that I charged somebody so that Again a client fee? It would have been a client fee, yes. Similar to the one that you described before, that 26 the client would have paid and you would have lodged 27 to your account? 28 A 29 240 Q Correct. At page 142 (Exhibit 16)we see the £12,000 you 47 1 explained to us but we have a sum of £55,000 again 2 lodged. 3 Yes, and I think likewise, if I may go back, to the 4 £35,000 of the previous year, I think that was in 5 April, was it not, also? 6 241 Q 7 8 A Yes, that was April 1995 we had £35,000 and in April 1996 we had a similar arrangement which has now gone 10 up to £55,000. 242 Q 12 13 This is page 132 there, lodged on 25th April (Exhibit 21)? 9 11 Transfer it says? Would you explain to me what that arrangement was again? A What it was was an accumulation of fees and 14 commissions that were accumulated in a suspense 15 account for Hamilton Ross and this was a direct 16 payment from John Furze to me for keeping this 17 service going to him and that was the incentive that 18 was to him was to get this thing finished with. 19 long as he continued on this I was going to 20 effectively take all the fees until he got this 21 cleared out. 22 243 Q As So this £55,000 does not have any relationship with 23 the £55,000 that you and Sam Field-Corbett each paid 24 in respect of Corporate Partners? 25 A 26 244 Q 27 A 28 245 Q 29 Absolutely not. It just happens to be the same figure? Absolutely. It is referred to there as a transfer whereas everything else is referred to as a lodgement? 1 2 246 Q 3 A 4 From what account? I think it was "A/A67", if you look, was the suspense account from which it came from. 5 247 Q 6 A 7 248 Q It was transferred from the suspense account? Correct. It is just not described in the previous year as a 8 transfer. 9 transferred to the suspense account? 10 A 11 249 Q 12 It would have been on that occasion It would have been, exactly. This was the suspense account of Hamilton Ross or Ansbacher? 13 A 14 250 Q Hamilton Ross in? 15 A In Hamilton Ross. 16 251 Q 17 18 Hamilton Ross. On the previous year Hamilton Ross was not a separate entity? A No, it was always a separate entity from 1992 19 although the management of it would have been out of 20 Cayman. 21 Furze moved out of Ansbacher Cayman. 22 252 Q 23 24 So this was the suspense account of Hamilton Ross in Hamilton Ross in Cayman? A 25 26 That is where the blurring came until Mr. Correct, although the funds were in the total bucket account within IIB, one must be clear about that. 253 Q 27 Right. The funds that this came out of were, tell me again? 28 A 29 254 Q It is in that general account which we referred to. The pooled account? 1 2 255 Q 3 A Which was the Ansbacher account? There were two pooled accounts. There is a pooled 4 account for Ansbacher and there is a pooled account 5 for Hamilton Ross. 6 256 Q 7 A And this one came out of the Hamilton Ross account? Correct. On the pooled account of course you would 8 see no movements because it is purely internal 9 within the Bureau system. 10 257 Q When you say you would see no movement on that 11 account at all, would there be no reflection 12 generally, would it not be lowered by that amount? 13 A No because no monies physically came out, so what 14 I think you would see would be in this instance a 15 balance on the suspense account, say, of £112,000 16 and then you would see a debit of £110,00 and two 17 credits of £55,000, so the overall balance did not 18 reduce in any way. 19 one account to another within the Bureau system, 20 within the separate accounts. 21 258 Q The funds have just moved from Maybe we are getting confused here. 22 about £110,000 and 2 £55,000. 23 now about Corporate Partners? 24 A 25 259 Q 26 27 We are not talking Let us go back to 35 then, the 70. You are talking about two payments to yourself and Sam Field-Corbett? A 28 29 No. We are talking Correct. If you had a marker on the board I would illustrate it very easily for you. 260 Q We have not but we could get one. 50 Maybe while Ms. 1 Cummins is getting it, we will look at the next one, 2 page 153. 3 (Exhibit 25)? 4 A. 5 261 Q. 6 Yes it is. Here we have the statement of your account for 1997 from April to July; is that right? 7 A. 8 2 62 Q. 9 Correct. And we see interest mounting up and then we see a large withdrawal? 10 A. 11 263 Q. 12 A. 13 14 Is this your writing, Mr. Collery Correct. Then we see? I might add that that withdrawal is the preliminary payment in settlement of my taxes to the Revenue. 2 64 Q. Right. Then we see a lodgement in Irish currency 15 transferred to Sterling, is that correct, of £22,759 16 Sterling? 17 A. 18 19 It is not Irish. 265 Q. 21 A. 22 266 Q. 23 A. 25 2 67 Q . A. 26 27 28 29 Yes, I beg your pardon. That is a lodgement of Sterling, is it? 20 24 No I think that is a Sterling figure of £22,759.38. That is correct. And what would that represent? If you back to page 148 (Exhibit 26)? Yes. There was an investment of A $50,000 made in shares which came to £22,809.53. 268 Q. When you say there was an investment made, this is an investment you made? 1 269 Q 2 3 And this investment was in Australian Dollars, it was an Australian investment? A It was an Australian company, yes. It was, I 4 suppose to use the phrase that is currently in our 5 own industry, a dot com but it was not quite a dot 6 com company but it was in technology industry. 7 270 Q 8 A 9 Can I ask you the name of the company? I can't recall it but I will have to go through the documentation to find out the name of it. 10 271 Q 11 A 12 272 Q 13 A And you invested this sum of AUD$50,000? That is correct. Yes ? And, as you can see, it was not a very good 14 investment because we sold it. 15 1997 and it made a loss of over £1,000. 16 273 Q 17 A I sold it in July of So this was the proceeds of sale? Correct and this was also to tidy up and close my 18 account in Cayman so any overseas investments that 19 I had I wanted to close them up and complete them. 20 274 Q 21 22 There is a small sum still in it there? A 23 24 So that was the closing of your account. That has been charged as a fee by Hamilton Ross so it has effectively closed now. 275 Q That brings us to the end of your statements. 25 Now, maybe I am going back over something but I have 26 a question to ask you about this. 27 covered it and I have forgotten but would you 28 forgive me if I asked. 29 101, if you would not mind (Exhibit 27)? Perhaps I have Could you look back at page 1 2 276 Q 3 We see a transfer there of £77,000. Did I ask you about that, Mr. Collery? 4 A 5 277 Q 6 A No but I can explain that. Yes ? What is happening here in 1992 is that the account 7 prior to this was held in the books of Ansbacher 8 Cayman Limited so it was held in the Bureau system 9 of Ansbacher Cayman Limited. 10 278 Q 11 A Yes . So what you see there is that debit of £77,092.34 is 12 bringing that account to zero as you can see from 13 the bottom of the page. 14 279 Q 15 A 16 280 Q 17 A 18 Yes . And then if you go to page 102 (Exhibit 28). Yes ? You will see the opening of the account with £77,092.34 which is the exact same amount -­ 19 281 Q 20 A 21 282 Q 22 A The opening of what account? Of an account in Hamilton Ross. No, it says Ansbacher Cayman Limited? It may well do but be sure that it is, it was some 23 movements around within Bureau systems because it 24 subsequently moved again in December 1992/1993. 25 what was happening there was the funds were moving 26 from one Bureau system to another and you see the 27 ins and outs which are of similar amounts. 28 I am puzzled about where it is going because page 29 102 where you see the reversal, which it is So 1 described as rather than a transfer, you are still 2 referring to Ansbacher Cayman Limited? 3 I do. 4 284 Q 5 6 It looks as if it is the same account and there is just a reversal of the transaction? A It is not -- I do not think it is the same account, 7 Ms. Mackey, because if you look at page whatever it 8 is . 9 285 Q 10 A 11 286 Q 12 13 It is page 4 anyway of the account (Exhibit 28)? If we look at page 43 (Exhibit 29). Yes, because the next is page 44 (Exhibit 30). So that seems to be a continuation of it? A That may well have been the case. So some movement 14 has been taking place out of one Bureau system to 15 another. 16 287 Q 17 18 So it is one Bureau to another but it is the same account ? A It is the same account, yes, and then we definitely 19 can see in December 1992 there is not a closing 20 statement because it is obviously missing. 21 288 Q 22 A 23 289 Q 24 A 25 290 Q Which page are we at now? If you go to page 104 (Exhibit 31)? Yes . You have a figure £79,975.74. At 105. Actually this is a question I was going to 26 ask you because on page 105 we have the account of 27 Hamilton Ross 28 29 A Correct. (Exhibit 32)? That is the movement definitely out of Ansbacher. 1 291 Q 2 3 We have a lodgement of this figure but we do not see it being withdrawn previously? A No but the closing balance of £79,975.74 on page 45 4 of the previous statement, which page number 104, is 5 the carry forward balance 6 292 Q 7 8 Well the closing balance on that page is carried forward and on the next page then it says, A 9 "B/F 0". Yes but it is the same account number but I can assure you it is in a new Bureau system. 10 11 (Exhibit 31). That is now in the Hamilton Ross Bureau system. 293 Q I see that and I see what you are saying. What I am 12 saying is we do not see that sum being withdrawn 13 from Ansbacher. 14 A 15 294 Q We see it being lodged certainly. The page must be missing there. That seems to follow on. We are talking about 31st 16 December 1992 on page 104 (Exhibit 31) and the next 17 page we are at 4th January 1993 (Exhibit 32) and we 18 are lodging what is the closing balance on the 19 previous page. 20 transaction showing the closing of Ansbacher Limited 21 account? 22 A 23 24 Whilst I accept the page that is showing that transaction is missing, 295 Q 25 26 My only point is that there is no I can assure you You think it might be that there might be a whole page between 31st December and A There is another page there. 27 Ms. Mackey, it is very clear. 28 number 3 there (Exhibit 33)? 29 296 Q -­ I do. -­ If you go to page 107, Do you see them 1 2 So if you go back, the next one is page number 2. 297 Q Yes. I see that and I see that the name is Hamilton 3 Ross on it. 4 anything showing us the withdrawal of that sum from 5 the account called Ansbacher Cayman Limited? 6 A 7 8 My sole point is that we do not have I do accept that but be assured that is what happened. 298 Q 9 I take the point. Looking again at this account of Hamilton Ross that starts on page 105, page 105 10 (Exhibit 32) itself is a bad copy from the point of 11 view of what is on the top, the heading, but if we 12 look at the next page, 106, we see that the 13 statement is still called Ansbacher Limited and it 14 is the account of Hamilton Ross and Ansbacher 15 (Exhibit 34)? 16 A 17 299 Q That was merely using up stationery. Well, that may be but what it appears there is that 18 this is a statement issued by Ansbacher Limited of 19 an account in the name of Hamilton Ross. 20 what appears from this document? 21 A That is what appears. Isn't that The fact would be that there 22 was stationery in Dublin which had Ansbacher Cayman 23 on it and, as I say, Ansbacher/Hamilton Ross, you 24 could deem at that point in time that Hamilton Ross 25 was a client of Ansbacher but because the two of 26 them are so intrinsically mixed, vis-a-vis the 27 ownership of Hamilton Ross by John Furze, that is 28 what has happened there. 29 300 Q So you are just using up stationary in Dublin? 1 Yes. 2 that type of thing wasn't very important. 3 301 Q Yes. These were all internal situations so really Can you point me to the statement where 4 Hamilton Ross ceases to appear on Ansbacher headed 5 paper and appears on paper headed Hamilton Ross? 6 A 7 302 Q 8 A 9 303 Q 10 A Well, in fact the stationary, if you go to page 116. Yes? No, sorry, if you go to page 114 (Exhibit 11)? Yes ? You will see that at that point in time we have, 11 granted the photocopy is not great, 12 Ansbacher logo on the right-hand side. 13 304 Q 14 A 15 16 114 has the Yes? Then when we go to page 115, November 1993, that logo is now left off (Exhibit 34). 305 Q It is left off but we are at page 11 of a series of 17 statements and the previous page is page 10 so it 18 seems to be a continuation of the statements that 19 have gone before it? 20 A It is and that is supporting my -- the stationery 21 has now been used up and we have now printed off new 22 stationery and the new stationery does not have the 23 logo of Ansbacher on the right-hand side. 24 306 Q 25 26 But it does not have the logo of Hamilton Ross either? A 27 But it has the name of Hamilton Ross on the left-hand side. 28 307 Q 29 A It has that all along? 1 So in fact for anyone looking at these they appear 2 to be a sequence of the same statements of Ansbacher 3 Cayman in relation to the account of Hamilton Ross 4 and the only difference between this and the 5 previous ones is that the name Ansbacher has been 6 taken out of it but other than that the same 7 sequence is taken? 8 A 9 10 It is indeed, it is on the same Bureau system, yes, absolutely. 309 Q I think there is only one other thing that I want to 11 ask you about, Mr. Collery, and not ask you about in 12 detail because this is not the moment, but simply 13 ask you to furnish us with the information you 14 offered us earlier and that is in relation to the 15 account of AA/30/KK. 16 relation to that? 17 A 18 310 Q 19 You offered to assist us in Absolutely, yes. Is it the case that you would be able to give us all the relevant information about that? 20 A 21 311 Q If I may, I would prefer to do that. I understand that. Well, for the moment we have to 22 reserve our position on how we will deal with this, 23 but for the moment, if you would undertake to 24 furnish us with everything you have in your 25 possession in relation to that account in your 26 control? 27 A Yes I understand. 28 Anything that you can get in relation to AA/30/KK 29 and we will look at that. 1 2 Thank you very much. I have no further questions. 3 Mr. Rowan might have one or two. 4 5 6 END OF EXAMINATION OF MR. PADRAIG COLLERY BY MS. 7 MACKEY 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 5 314 Q. MR. ROWAN: Just one final point, Mr. 6 Collery. We have spent a 7 lot of time just now talking about what was printed 8 on the headings of the stationery particularly on 9 the changeover period. Would other customers of 10 Ansbacher/Hamilton Ross have received similar 11 stationery, details of their accounts and similar 12 stationery? 13 A. Yes if they requested it. As has been, I understand 14 and it is true, that during Mr. Traynor's tenure and 15 as indeed can be supported from the early days of 16 those statements, the heading of the statements were 17 shredded or cut off. 18 somebody asked for a copy of their statement as back 19 as far as they could, and there are some 20 difficulties in giving that information because of 21 restrictions on us, but, yes, looking at the 22 originals of those documents the early days had 23 Ansbacher logo on the right-hand side, and then from 24 whatever date we discussed there in 1993, the logo, 25 because there was a reprint of stationery, it does 26 not have it on there. 27 315 Q. Certainly during my tenure, if You obviously were aware why that was. How easy was 28 it to explain to people who might not have been so 29 close to the action what was going on and did they 1 ask? 2 I think that is the pertinent question. 3 really people did not concern themselves. 4 I can see, and indeed having spoken to people, they 5 trusted Mr. Traynor. 6 affairs or looking after their funds that they had 7 deposited in Cayman and these documents served to 8 account for those funds that were lodged or were 9 held on behalf of those individuals or to the I think As far as He was looking after their 10 benefit of those individuals and it merely was 11 accounting confirmation that they were receiving. an 12 13 I 14 individual, and I have tried to do it with people 15 who not familiar with the intricacy of banking, and 16 where you start talking about where accounts resided 17 etc., really a person not familiar with the banking 18 system has great difficulty in understanding how all 19 this thing operated and indeed the more they read in 20 the papers they even get more confused. 21 316 Q 22 think to go into the intricacies of it for an You were going to demonstrate something to us on the chart? 23 A 24 317 Q Would you like to do that. 25 318 Q MS MACKEY: 26 Yes . I am just thinking, Mr. Collery, that while the 27 chart is a great idea from the point of view of all 28 of us here, it will not go on the record. 29 be better if you did it on a piece of paper that we Would it 1 could append to the transcript. 2 would? 3 Yes . 4 319 Q 5 A I think it actually And you can tell us if you would not mind? You want me on illustrate how both systems work 6 parallel to each other or just concentrate on 7 Hamilton Ross? 8 320 Q 9 If you would demonstrate how they work parallel to each other that would be great, thank you. 10 Probably the best thing would be if you draw it, Mr. 11 Collery, and then you can show it to us and explain? 12 A 13 Yes, that is exactly what I am going to do (Pause). What I am illustrating here are two pages, one 14 (Exhibit 35) headed up "Ansbacher Cayman Limited" 15 and one headed "Hamilton Ross". 16 side of the page I have then illustrated with the 17 word "Bureau system" with accounts A, B, C and D, 18 and in the account A as illustrated there is a 19 balance of £700 20 credit, account C is £200 credit and account D is 21 £300 credit. 22 321 Q 23 A credit. On the left-hand In the account B is £100 MS MACKEY: These are just examples? These are just examples. On the right-hand side of 24 that page I then illustrate that there is a general 25 bank account which would have been held in Irish 26 Intercontinental Bank which represents the total of 27 those accounts at £1,300. 28 29 On the next page, as I have said, I have illustrated 1 Hamilton Ross, and likewise it had its own 2 independent Bureau system and in the illustration I 3 have accounts A, B, C and D. 4 balance of £400 credit, account B has £200 credit, 5 account C has £100 and account D has £150. Account A has a 6 7 On the right-hand side Hamilton Ross also had an 8 account in Irish Intercontinental Bank and in this 9 example obviously it would be representative of the 10 total balance in the Bureau system coming to £850. 11 12 In the example that we were discussing as a payment 13 of the fee from the suspense account in the Hamilton 14 Ross books in the Bureau system if account B 15 represents my account and account D represents the 16 suspense account we were talking about, the £50 17 would have been debited to account D and credited to 18 account B and, therefore, the overall balance -­ 19 totality of them would not have moved and therefore 20 you would have seen no movement on the general 21 account within IIB. 22 322 Q. MS MACKEY: 23 24 you. 323 Q. MR. ROWAN: 25 26 27 28 29 That is very clear, thank Just one point. That looks like 113. It is intended be IIB. A. Correct. MS MACKEY: Thank you very much, Mr. 1 Rowan has one final question before we wind up. 2 MR. ROWAN: Mr. Collery, just 3 reverting to the page in 4 our book number 3 6 which Ms. 5 a copy (Exhibit 4)? 6 A 7 325 Q Cummins will pass you (Handed). I omitted to ask you, bearing in mind the address on 8 the right-hand side, 245 Beech Park, Lucan, there is 9 about 3 or 4 lines further down a further reference 10 to that same address against a company called 11 Darsley Nominees Limited. 12 that organisation? 13 A Are you familiar with This was a company which was used by me to 14 facilitate the cashing of cheques with the Bank of 15 Ireland. 16 obviously you could get cash, so the process was 17 whereby a cheque would have been requested from IIB, 18 then lodged into the account of, in this case 19 Darsley Nominees Limited,and then cash withdrawn and 20 this account was held with the Bank of Ireland and 21 in the documentation that you received, you have 22 bank statements relating to that account. 23 326 Q 24 A 25 26 IIB did not have the facility whereby Who controlled Darsley Nominees? The signatures on the account were myself and Sam Field-Corbett. 327 Q It was an Isle of Man company. You answered me by saying the signatures on the 27 account. 28 yourself also controlled the share capital? 29 You controlled it in legal terms. Does that mean that Mr. Field-Corbett and Obviously there 1 were Isle of Man directors and shareholders. 2 328 Q 3 A 4 329 Q Actually? 5 A Actually. Holding shares in trust for you? In effect yes. The company had no value because it was 6 just a cash company of which the balance was moved 7 in and out. 8 330 Q Darsley would have fulfilled, would it not, a 9 similar function or at least a function of a similar 10 type to that which one of the Amiens companies would 11 have fulfilled? 12 A 13 14 It would indeed. Kentford would have been another one of those, yes, I would accept that. 331 Q But Darsley actually was a company effectively 15 controlled by Mr. Field-Corbett and yourself whereas 16 the others were companies controlled by one or other 17 of the Ansbacher entities? 18 A They were controlled by Mr. Traynor so, effectively, 19 when Mr. Traynor died I went through the process of 20 closing the Kentford account that was in existence 21 at that point in time. 22 332 Q 23 So Darsley actually came to being post Mr. Traynor's death? 24 A 25 333 Q It did indeed. I am sorry to labour the point, the facility to 26 obtain cash out of Darsley was to facilitate not 27 just yourself but other clients? 28 A 29 334 Q The clients of Hamilton Ross. Yes? 1 2 3 In due course we will 4 go through the routine with which you are familiar 5 of you being asked to approve and eventually come in 6 and sign the written text of this interview today. 7 A. I very much appreciate the last arrangement we had 8 so if we can maybe do something similar. 9 MS. CUMMINS: 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN CONCLUDED Yes. Without Prejudice Overview D o c u m e n t 1. Objective The objectiveofthisdocument istwofold 1) givean indicationofmy rolegenerally, 2) tooutlinethekey dateswhichwillassisttheTribunalinunderstandingthe keepingofrecordsoftrustaccountsheldinGuinness& Mahon Limited (Dublin) andsubsequentlyinIrishIntercontinentalBank. 2. Career My entirecareerhasbeenalwaysassociatedwithBanking.The followingarethekey dates: . 1.1968-1974: LloydsBank, London -Bank OfficialinRetailBanking. 2.1974-1939 : Guinness & MahonLtd,Dublin-SeniorBank Officialwith '- responsibilitiesforAccounts and ComputerOperations. 3.1989-Present: s KindleBankingSystems - SupportManager supporting StandardCharteredBank siteswhichuseKindleproducts 4.1976-Present: . MaintainedMemorandum accountsinrespectofAnsbacher Cayman Ltd (formallyGuinness& Mahon (Cayman) Ltd) clientsand.subsequentlyHamiltonRoss clients. 5. 1994-Present: ActedasLiasionOfficerforclientsofAnsbacherCayman Ltd andHamiltonRossLtduntil1995 andthereaftertopresentfor HamiltonRoss Ltdonly. ' My main areaofresponsibilityinGuinness& Mahon was theManagement ofthe accountsdepartment oftheBank. Thisdepartmentwas responsibleforthe maintenanceofallthecustomerandinternalaccountsoftheBank. The department would have actedon theinstructionsofthecustomersand on instructionsreceived . frominternalsources.ItalsoprovidedinformationtotheBanks customers, informationtointernaldepartments,Auditors,etc. As partof my roleIprovidedassistanceinthekeepingofmemorandum accountsfor Guinness & Mahon DublinLtd’sthensubsidiaryGuinness & Mahon Cayman Trust Ltdwhich subsequentlybecame AnsbacherCayman Ltd. The following detailsthevarioustypesofdocumentation which existedfor Ansbacher Cayman Ltd and arepartoftherecords inG & M Dublin. 1. 2. Bank Statements of Ansbacher Cayman Ltd accountwith G & M Dublin. Instructions from AnsbacherCayman Ltd /Mr Des TraynortoG & M Dublin. 3. Advice’s/ContractNotes oftransactionsoverthevariousaccounts. 4. CorrespondencerelatingtoAuditconfirmationsand intercompany issues. Inadditiontotheserecordsthereexistedotherdocumentationwhichwere forthe benefitofAnsbacher Cayman Ltdwhich relatedtotheirclientsand canbebest described asfbllows:5.Memorandum accountrecords. 6.Instructionsrelatingtotheserecords. 7.Trust/Company /Individual correspondence files. Memorandum accountsweremaintained forsterlingaccountsonly.Thesewere originallyheldtoassist Ansbacher Cayman Ltdkeep arecordoftransactionsoverits individualclientsaccountsuntilsuchtimeasithad itsown computersystem. While thatrequirementwasresolveditwas found thatthesystem assistedintrackingthat correctpostingswere beingmade by thebank inCayman and balances could be obtained when thebank was notopen (Time difference).In lateryearsthesystemwas used tocontrol and keep trackoffundswhich were placed forliquidity/funding reasons with G & M LtdDublin. While instructionsrelatingtoatransactionregardingthebank accountwithG & M Ltd Dublin would go on theBanks records(G & M Ltd),separatewritten instructionsby Des Traynorwould be endorsed on a copy thereof and would be ( given to me toindicatewhichmemorandum account/accounts shouldreflectthat transaction. Trust/Company /Individualrecordswere maintainedby Mr Des Traynor. 4. Significant Dates - *84(?)- Mr Des Traynor leavesG & M *89-Padraig ColleryleavesG & M ‘90/91 -Accounts move from G & M toIrishIntrcontinentalBank (HB) ‘92 -Some clientsmove from Ansbachertonew Company (HamiltonRoss Ltd) (HR) which opens abank accountwithIIB and italsohas a Memorandum Account supportstructuremaintained by me on instructionsfrom Des Traynor. ‘94 -Mr Des Traynordies ‘95 -Ansbacher accounts closedinIIB Present - HR moving toJohn Furzenew trustcompany inCayman. From the above datesanumber ofsignificanteventswoe triggered.Itisimportant to understand thatfrom ‘76 to ‘94 my role,apartfrom my primaryfunctionwhether itbe in G & M orafter,was thatofan accountrecordkeeperon theinstructionsof.MrDes Traynor. This rolewas expanded in 1994 forthefollowingreason: On thedeathofMr TraynorIwas contactedby Mr JobsFuize (DirectorofAnsbacher Cayman Ltd and DirectorHan^tltnnRoss Ltd) and askedifIwould actasaliaison person inIrelanduntilsuchtime asalternativearrangementswere made. He instructed me tocontactMr Traynors secretaryand seekreleaseofthefilesrelatingtothe Cayman operation.As theserecordshad nothingtodo withmy principleplaceof employment Icontactedapersonal friendofmine (Sam FieldCorbett)toseeifhe had an officetohouse thesefiles.As thiswas tobe atemporarysituationhe offeredto assistme, provided thespacerequiredcouldbe limitedtoone filingcabinet In Oct /Nov '94JohnFurzecame toDublintomeet withhisclients.Duringthatvisit he reviewed allthefileswhich I removed from Mr Traynors office.Arisingfrom thatreview some filesremained, some were shreddedbecausetheclientswereno longerwith thebank, some he tookback withhim. Early ‘951was advisedby John Furze thathe was leavingAnsbacher Cayman Ltd and was planningtosetup anew trustoperationinCayman. He expectedthatit would takehim andhisnew partneratleastone yeartoobtaintheTrustlicencebut theearlyindicationswere thattheauthoritieswere givingitfavourableconsiderations. He also indicatedthatAnsbacher Cayman Ltd were now inapositiontoand indeed ' wished to closethebank accountswithIIB and takethefunds back intotheirown books. The transfertookplaceinMarch ‘95 and thus ended theneed foirkeeping memorandum accountsforAnsbacherCayman Ltd. Over the followingmonths assistancewas giveninreconcilingaccountrecords and thisexercisewas completed towards theend ofJune *95.1continuedtoprovide a liaison rolebut had no inputorotherwisetothefinancialrecords sinceJune ‘95 for Ansbacher Cayman Ltd,As thereconciliationofaccountswas completed,Ansbacher Cayman Ltd were satisfiedthatithad controlofthesituation,therewas no needto hold onto theoldinstructionson memorandum accountsgivenby Mr Traynornorwas t thereany need forthememorandum accountsasthebankhad recordsifrequiredby theclientsand therewas a spacelimitation, the documentationmentioned in paragraph 3 section 5 & 6 were shredded inoraround September 1995 by myselfand Mr. John Furze. InrelationtoHamilton Ross most oftheclientfileshavebeen carriedforward from theperiod when theaccountswerewithintheAnsbacheraccountstructure, memorandum ofaccounts and instructionsfrom Mr Des Traynorpriortohisdeath were shredded forthesame reasonsasabove. However memorandum accounts from the beginning ofthenew arrangementareavailable(i.e.afterthedeath ofDes Traynor). j f jT. Schedule Transactions From the above 1trustitisclear astotheavailabilityofdocumentation and non­ availabilityofotherstotheTribunal. Iwould alsowishtostateagainthatfrom ‘76 to ‘941performed abookkeepingroleforAnsbacherCayman /HamiltonRoss Ltd / Mr Traynor. IacceptthatifwhatisstatedinthescheduletotheTribunal Orderfor Discovery dated 19thMay’97 istruethenitislikelyIpostedtheamounts mention therein. Ido notrecallsuchamounts nordo Ihave anyknowledge ormemoiy asto. which memorandum accountoraccounts such amountswereposted. Sincethedead!ofMr Traynor Ihavehad accesstothefilesandhavebeen contacted by clients. Ithereforehave agreaterknowledge ofindividualsituationsand ' transactions.Ifthereisany doubt I contactMr Furzeforinstructionsashe isthe Directorand ShareholderofHamiltonRossLtd andthereforeresponsibletothe clients.As JohnFurzenow hashisTrustlicencetheseclientswillbe managed by this new company and aswithAnsbacherIwillhave no involvementintheverynear future. dic/arisc/misc.97/trib l .a ll Dfc_ DATE 1*1. f’ij'si t a/ c L U D U tiri '■ PARTICULARS DEBIT VALUE DATE 3incCo7 <=i)ALA;.Ci . b»Uth>Hr FQKWAKj. 04JAN68 CR. IM L R L S I K A lf r.MAuf.in j.o n r..»nsc. 1 S JANdfl LjDGr t* . 2VJAN81) LuOur.. •■ ■ • • 51 f: a ?wan-1m BALANCE .1 . 3'577-90 3.07709U 11000-0? 4.577.100 125.90 ?9803.40 a) HUM D E P O S I T ACCOTTHT W I T B P B & B & L ■ V v sW tk C f W v I/We hereby request a withdrawal fromjptffour Deposit Account No. the sum of ’ ...P ■*** , G - ^ P W S ,( = S O . n \" f a t .ia Q Name Details I Where Held {Collery Mr 1N0 Trust iAnsbacherlHR [Alc Code[ Address im. 30 i245 Beech Park, Lucan, Co Dublin OROUUIIT FOHWAHU j j i / i . 2 / y c i 2/ i/yj 11 / j/oi 3i/tt/9J 3/ 1/91 17/ 1/91 •j/ 1/9• r y i/si il U'H V i/*n iiy i m ___ __ ^fKKJED LODGED LOWED L'RAf-T CACA CARRIED FORWARD 881.78 5450.00 6075.00 60.00 . IA-uu 'c . 4807h 54951.06 54091.06 5h867.06 I« •Wj .* • 3/10/91 4/10/91 Jl/IO/qi 11/10/91 n / io / * i* V____ ' 2/i ?1 A/M. A 31/10/91 *31/10/91 'Huuuni ruiniMiu W.U vJL MUTUAL LODGED L00CCD . - 1000.00 06290 i. 98.0. -. 88200. 125.00 750.00 67075.08 . A. m. . .IH if )/ 30/ 1/ y / 9 1 3 u , i/ S / , LUUGUU [n tP I -0 1 1 , lo 3 0 / CAHRIEO FOBWAHD 9 / ‘JI 8 9 I25.00 759;?? E??wu 65298.77 )V / • J H L H J t a tll I 1/ J l 12/12/91 M/12/91 H/12/91 M/12/91 12/ HI 31/1.. Jl 31/12/91 31/12/91 kjhwahu DGED U0D6ED LODGED Interest to 31/12/91 / 11/12/91 V______ CARRIED FORWARD - 67490-?0 0000,00 60490. 125.00 750.00 M2914 71088.97 13/ 4/92 1? - 4/9" 'USED 13/ 4/92 l's. /9s. **1000 30/ 4/92 10/ 4/^2 30/ 4/92 30/ 4/92 LODGED LODGED 30/ 4/92 \ ______ CARRIED FORWARD 1000.00 920.00 - 691a. A 125.00 750.00 70015 . 0'0 ) O Tutu* Ct> ‘XX. (kCCOUHT tiUUuth tiuu,l‘ llU' aAiANCts shown Ahe »h . «r IT l>ut ~ *-c ‘ 1 04-- . a 07/10/93~ 15/10/93 15/10/93 31/10/93 31/10/93 .. I . BHOUGHTPORWMBO LOHGED COL HUT It -- CAREIED FORWARD . ?has. in.? aw '09" Pelaal'nuoa 5b- 44 76nd. (.3 363$ Cut..th ?In. u-nn-a-u, 1500 PAGE sterling sccoum unmask amimcas Shown ARE m: 89449.33 916h9.33 91350.65 2000,00 750.00 92100.-7..- 7. . i 1 . %o*WSt9 .ti>«prton(i No 0 — 4t&*2M4 Tele* CP 305 CbUic riLTUK KO.SN J L A C C O U N T N U M E tE tt Uutituc. 0 0 0 0 1 3 6 6 »>aQ E BALANCES SHOWN AHfcIN: Stferlirig -•• 'pm/93 15/06/93 15/06/93 10/06/93 30/06/93 30/06/93 30/06/93 BROUGHT FORWARO LODGED LODGED : Interest to 30/06/93 66986.81 125.00* 730.00 87661.81 (dopnonc Ku 9 *uVit4 Telex CP 305 Cable Addfub^ Ouuuicu JlTOlLTOX kuh'S kj\:\u L 10/06/93 17/07/93 07/07/93 2/07/93 12/07/93 11/07/93 31/07/93 J ACCOUNT HUUBER 80001366 PaGE BALANCES SHOWN AHE IN: Sterling 1 - brought forward IH 1000 T CHQS ' LODGED 980.00 2020.00 750.00 89026.34 88046.34 86026.34 7 tJ?\ ) ) • BOSS 6a h ILTOH ] A/A 30 L. 31/01/95 31/02/95 01/02/95 33/02/93 24/02/95 28/02/95 -J ‘ • BH0U4HT" K>rtWAHD 01/02/93 LODGED 01/02/95 HE 03/02/95 COJiF Fl'tffiS 24/02/95 IttfiV KWTItY • 24/02/95 LODGED ACCOUNT NUMBER 80001386 PAGlE BALANCES SHOWN ARE IN: sterling 26 86367.74 750.00 300.00 55000.00 H 55000.00 176101.67 87417.74 32*.17.74 87417.74 i i 28/02/95 ____ o CARRIED FORWARD 263519.41 ) < c r a n s m . : r . , ^ a 3 ia i m a ILTON BOSS 28/02/95 27/03/95 11/03/95 27/03/95 31/03/95 BHOUQHTraMUAHO IB2000 Interest to 31/03/95 >1/03/95 CARRIED FORWARD 80001386 9582 sterling 27 2013.00 263519.41 261506.41 263315.22 ) a) ! 1UH HAMILTON ROSS f ! A/A30 ACCOUNTNUMBEH 60001386 pxag BALANCES SHOWN AREW: sterling ^ HI I M W 38 !’ liu. ^Tf7tf3796 30/04/96 30/04/96 . 30/04/9$ 30/04/96 BaCMJQtirK)HWAHO~ 1§12 rv n n A n u ACL PHTS 55000.00 266641.59 12000.00 o ’ ” * ’ iV y*“ **\v 5Tsv»c'*,>'/tfj f ^ ,i•’ /V t*i*‘'i\,r>,sV? $ f.X -•^>*‘*’T #,VI*'^!.v.*i- .'«-*' t.'*^vJf’*"T'*‘ -"^<2‘ ^H.,_'-rvj‘W J> © •c-'h''~ :'.«l/-iS“;:vi3Vcv S*&« ■i*i "i^T at > ;.»<.h'?>--'-i •~-•vr-*V '.rY* /•V >*^-*v-..v'*,. * r^v: ?\ ;.; > 9 'P lg S S K f • r>rH tf-S« cc'J9^y.•V^ O 30/04/96 CARRIED FORWARD \) 355641.59 ST ATE ME tW Q F A CC 0 U NT HAMILTON BOSS 0 0 30/04/96 09/05/96 31/05/96 31/05/96 & © 0 22/04/96 23/05/96 23/05/96 BfiOUOWr FORWARD ACL APfi IBP5000 ACL Alaao mm 80001386 PAGE 39 . unmeasuowumw . sterling 355641.59 - 1000.00 356641.59 5200.00 . 1000.00 352441.59 . . . . If I. i if! A .iv?iitll?!? Dill-r? l! fr? apt. 01' I 1.1. Ix. il. [it it! rr.? .. I .91 IL. ll? PAH. I. PM [El I. 1? Lin. 3- 5- . I Ikn?l.? a A . 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WE soot: 1'31 man I 2,721.95 JJPJEU 2.403.l?5 ) M O jCnsbacher i.iwitc.J Layman t} C.«rf Vn. 31/01/93 CARRIED FORWARD *\/n & CD1 L 18/02/93 11/03/93 H/03/93 11/03/93 J 31/03/93 31/03/93 31/03/93 BROUGHT FORWARD LODGED . LODGED Interest to 31/03/93 >.. ACCOUNT NUMBER 80001386 p*GE BALANCES SHOWN ARE IN: sterl ing 125.00 750.00._ 81725.74 , 6- €■ It $ » 11/03/93 CARRIED FORWARD f 83782.11 3 I*U U«*» Itfil Teitpnonu Nu 9 -4bVji4 Telex CP 305 Cable Addict Gutmui*.*'., kjk’U. L n £/£/£ 18/02/93 ACCOUNT NUMBER 80001386 jpAGE BALANCES SHOWN XHE IN: St fer1lag ^ -;r-? 28/02/93 28/02/93 ' LODGED .. *^ , 28/02/93 s.____________________ CARRIED FORWARD 125.00 750.00 "B5B5CTT Mm}. $06 ?'93 7?9. ?44 /oo? ?9 6 4! (616?sz14 z?imJ 7011? 1/69 5 A??w {gava 40?. ?93 20. /00? ?0 ?60 ?3 5 Appendix XV (18) Mr Cornelius Collins 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Cornelius Collins. a) Transcript of evidence of Mr Cornelius Collins of 11 April 2000. b) Letter of 4 April 2000 from Mr Collins to the Inspectors. c) Letter of 9 December 1976 from Mr John Furze to Mr Frank Lee. d) Redhall Investments Ltd 1976 accounts & Redhall Trust documentation e) Letter from Neil McCann to GMCT (undated). f) Letter of 15 December 1976 from TR Leonard to JA Furze. g) Telex of 17 November 1976 from RU Leonard to JA Furze. h) Letter of 29 June 1976 from Frank Lee to R Leonard. i) Letter of 5 January 1973 from Alex Spain to Vincent Walsh, Arthur Cox & Co. j) Earl House Ltd - Extracts of Annual Returns 1972 & 1975. UNDER OATH ON TUESDAY, 11TH APRIL 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. CORNELIUS COLLINS WITNESS MR. C. COLLINS PAGE EXAMINATION MR. JUSTICE COSTELLO M S . MACKEY 5 - 41 42 - 47 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Collins, we will start our interview then. My 6 name is Declan Costello and on my right is 7 Ms. Mackey. 8 been appointed by The High Court to carry out this 9 investigation. We are two of the Inspectors that have 10 11 I should explain to you Mr. Collins that this is not 12 a Court of law. 13 interview. 14 interview persons such as you. 15 can do so under oath and we will require you to take 16 an oath. 17 administer the oath to you. 18 take the oath now. 19 MR. COLLINS: 20 21 22 23 24 25 26 27 28 29 It is not a Tribunal. It is an We are required by Order of the Court to Under the Statute we We are going to ask Ms. Cummins to Perhaps, Okay. you would 1 2 EXAMINED AS FOLLOWS BY MR. JUSTICE COSTELLO 3 4 MR. JUSTICE COSTELLO: 5 Mr. Collins, I do not know whether or not you have 6 taken any legal advice in relation to your 7 attendance here before us. 8 explain to you in case you have not that the Statute 9 places a duty on you to assist the Inspectors. 10 However, I should you understand that. 11 A. 12 1 Q. Absolutely. Are you prepared to assist us in our...(INTERJECTION)? 13 14 A. 15 2 Q. Absolutely. Mr. Collins, I want to refer you firstly to our 16 letter to you of the 20th January last, this was 17 this long letter (Exhibit 1)? 18 A. 19 3 Q. 21 A. 22 4 Q. 24 Right. If you look at page 7 of that long letter. It is the beginning of Appendix C? 20 23 Do Yes. You were asked as follows: "You should provide a full and detailed statement of all the dealings which the Company had with you, whether directly or indirectly." 25 26 And it goes on to set out the Directors, in the 27 information. 28 4th April? 29 May I refer you to your letter of the 1 5 Q 2 A 3 6 Q 4 5 I have it here, yes. You see Mr. Collins I must suggest to you that that is not a proper compliance with our request? A Well, I am sorry if it isn't but when I was setting 6 up this meeting, it may have been with you. 7 not quite sure what lady I spoke to. 8 that I didn't even have to make a response. 9 7 Q 10 A 11 8 Q 12 A I am I was told Well...(INTERJECTION)? Because I had a time difficulty. Yes ? I said I was tied up to a certain date. I then had 13 to consult with my legal advisor and then I had to 14 prepare this response. 15 9 Q 16 A 17 10 Q 18 Yes? And I was told that it wasn't necessary. What I must explain to you now is that we do require a detailed statement from you? 19 A 20 11 Q Okay. And that your letter is just a very, very broad 21 outline of the fact that you had dealings with the 22 company. 23 A 24 Can you do that for us? Well, what I can do and what I thought I was doing here today was to elaborate on this. 25 12 Q 26 A 27 13 Q No, no? I don't have...(INTERJECTION). No. Of course you cannot do it today. However, 28 what I am saying is that unfortunately Mr. Collins, 29 because there has been non-compliance with our 1 requirement, that unfortunately we have to only have 2 a preliminary meeting today and ask you to make a 3 full and detailed statement for us. 4 that? 5 I don't think I can in the absence of any records. 6 I don't have anything. 7 14 Q Of course. Can you do Of course, you cannot do it today. 8 However, what I am asking you, what I am suggesting 9 to you, to Mr. Collins is that we need a detailed 10 statement, as required in this letter, of all your 11 dealings with the company? 12 A 13 15 Q 14 A 15 16 I don't know if I can do that in all honesty. Well...(INTERJECTION)? I don't think I have -- I certainly have no records available to me to enable me to do that. 16 Q Mr. Collins, we must ask you to try to do it because 17 it is very important that our work is carried out in 18 a systematic way and if we do not get cooperation 19 from our witnesses, in the way we require it, we are 20 not going to be able to do our work properly? 21 A 22 17 Q Well, I am sorry. Yes. I took legal advice on this. I am now asking you Mr. Collins, are you 23 prepared to write out a detailed statement of 24 your dealings with the Guinness & Mahon, with 25 "Ansbacher", and its associated companies? 26 A 27 I am quite prepared and willing to give anything that I am able to give. 28 18 Q 29 A Very well? 1 19 Q. 2 Very well then. You will then, doing the best you can? 3 A. 4 20 Q. 5 A. 6 21 Q. A detailed written statement as far as you can? 7 A. I will but again I have to say that without the Right. Give us a written statement? Right. 8 absence of records how detailed I can 9 get...(INTERJECTION). 10 22 Q. 11 A. 12 23 Q. 13 A. 14 24 Q. 15 Very well. You will have to do the best you can? It is the best of my recall. The best you can? Okay. Very well. That being so I am afraid that we can only go a certain distance today? 16 A. 17 25 Q. Okay. However, in our investigations, discussions, today 18 Mr. Collins we may be able to indicate to you the 19 sort of information that you...(INTERJECTION)? 20 A. 21 26 Q. 22 A. 23 27 Q. Okay. That we will require in your statement? Yes. The second thing Mr. Collins, in relation to the 24 letter and your response, was that, did we not make 25 it perfectly clear to you that we required you to 26 furnish us with all the documents that you had in 27 your possession? 28 A. 29 28 Q. You did. You have not done that? 1 2 29 Q. 3 A. 4 30 Q. 5 A. I know what you said Mr. Collins? Right. Why have you not done that? I thought, in fact, that you may have had from 6 Guinness & Mahon everything they had in relation to 7 my dealings with them. 8 31 Q. 9 documents, you have in your power and possession 10 11 that we might require? A. 12 13 Why did you not give us the documents, all the Because I don't think what I have are the complete documents. 32 Q. I know that. However, we required very clearly, in 14 our letter to you, that you supply us with the 15 documents whether they are incomplete or complete we 16 require them? 17 A. 18 33 Q. 19 A. 20 34 Q. 21 A. 22 35 Q . 23 A. 24 36 Q. Yes. Will you supply them to us? Yes. Very well? Sorry, can I make notes of your requests there? Yes. I will use the back of this. Yes. I should make clear Mr. Collins that a 25 transcript of this interview will be made. 26 ask you to sign but it can be made available to you 27 if you require it? 28 A. 29 37 Q. I would, yes. So that you can have a full transcript. We will 1 Unfortunately you have to pay for it but that is a 2 departmental rule? 3 A. 4 38 Q. Okay. Very well. I want to just ask you some questions 5 now and you can elaborate on it later in the 6 statement which we require. 7 you had extensive dealings with Guinness & Mahon and 8 you had deposits in Cayman Trust, with Guinness 9 Mahon Cayman Trust? 10 A. 11 39 Q. 12 However, you say that Yes. Who was it who first introduced you to the possibility of having deposits in Cayman Islands? 13 A. 14 40 Q. 15 A. 16 My advisors at all times were SKC. Yes. Who in SKC? Alex Spain, Don Reid, John Callaghanyes. Guinness & Mahon itself? 17 A. 18 41 Q. 19 What about Mr. Traynor. No. Did you have any discussions with Mr. Traynor then about this? 20 A. 21 42 Q. About those deposits? No, just generally. I am just asking you generally 22 about using the facilities of these Cayman 23 companies ? 24 A. 25 Yes, I had discussions over the years with -- I was intensively involved with Guinness & Mahon. 26 43 Q. 27 A. 28 44 Q. 29 What about Yes? So, I had discussions with Des from time to time. However, with regard to establishing the 1 2 A. 3 Not initially. Not as they were being set up, no. It was subsequent. 4 45 Q. 5 A. 6 46 Q. 7 Had you known Mr. Traynor? No. It really was as a result of your discussions with Stokes Kennedy Crowley that you...(INTERJECTION)? 8 A. 9 47 Q. Yes. Were they your own personal accountants as well 10 Mr. Collins, looking after your own affairs or were 11 they...(INTERJECTION)? 12 A. In the early years I used Austin Bradley & C o . In Cork. 13 14 48 Q. 15 A. 16 49 Q. 17 A. 18 19 They were ultimately. They were your accountants? Were my accountants, yes. And...(INTERJECTION)? In the earlier years up to the mid 1960s I would say. 50 Q. What I want to get clear is whether or not when 20 you started on this you were advised by 21 Stokes Kennedy Crowley, whom you have mentioned, 22 but did you go to anybody else to get further 23 advice about it? 24 A. 25 51 Q. 26 A. 27 52 Q. 28 A. 29 53 Q. No. You did not go to another accountant for example? No, I didn't . You did not? No. What about a solicitor? Did you go to a solicitor? 1 2 54 Q. Tell me what was the arrangement that they were 3 proposing to you? 4 me an outline of what they were proposing you should 5 do? 6 A. What was the outline of it? Give What they were proposing was that -- I had funds and 7 assets abroad that had been gifted to me and the 8 advice given by SKC was that it would be better to 9 keep those there. 10 11 They were (inaudible) off shore. They had been returned. 55 Q. That was the advice. Be a little bit more specific? First all who was 12 the person, who was the relative, who gave you these 13 gifts ? 14 A. 15 56 Q. 16 A. 17 57 Q. 18 A. 19 58 Q. 20 A. 21 59 Q. 22 23 An uncle of mine. Neenan, yes. His name was Neenan. What was his address? He was West Eleven Street, New York City. So it was in America? Yes. It was in America? Yes. I want you to tell me now what were you advised about the Cayman Islands? A. 24 I was advised to keep these funds off shore. was when...(INTERJECTION). 25 60 Q. 26 A. Out of Ireland. 27 61 Q. Out of Ireland? 28 A. 29 62 Q. What did that mean? That is what it meant to me. Yes? That 1 2 63 Q. 3 A. 4 64 Q. 5 A. 6 65 Q. 7 A. 8 Yes? And...(INTERJECTION). Was this for tax purposes you were advised? No. Well, taxation levels here were pretty severe. I know that. Ultimately. However, was that why they said? Ultimately, it would have been to protect those assets, yes. 9 66 Q. 10 A. From the taxation point of view? Well, reinvesting time here, I think was their 11 attitude, would have been not as productive as it 12 would have been. 13 67 Q. 14 No. I am not raising any criticism. I just want to try out the facts? 15 A. 16 68 Q. Yes. The facts were that you were advised that for tax 17 purposes it was better not to bring them to Ireland, 18 was that it or am I wrong? 19 A. 20 69 Q. 21 A. Well, now just to be clear on what I am saying. Yes? That these were in the main US equities. 22 dividends came to me here. 23 year and tax was paid on them. 24 70 Q. 25 A. The They were returned every Yes? The advice I was given was that it mightn't be that 26 productive to bring the assets back for investment 27 here, in that the taxation climate was not conducive 28 to investment. 29 71 Q. Then did you continue to get the dividends then? 1 2 72 Q. 3 A. 4 5 73 Q. A. 74 Q. 10 A. 75 Q . 12 A. 13 76 Q. 14 A. 15 77 Q. 16 A. 17 78 Q. 18 A. Just tell me what they said? What they said? Yes? Essentially to keep it there. No, no. About the trust Mr. Collins? The trust? Yes? I can't recall anything specific about a trust. Unspecific then. Just generally, did they advise They certainly advised me about setting up a trust for my kids which didn't involve these. 21 79 Q. 22 A. 23 80 Q. 24 A. 25 81 Q. 26 Yes. Where? Here. In Ireland? Yes. What about the Cayman Islands? Did they advise you about setting up a trust in the Cayman Islands? A. 28 29 No, no. you about it? 20 27 I am sure they did but trust in the complete sense, no. 9 19 Can you just tell me now, did they give you any advice about establishing a trust? 8 11 I would say that was some time in the mid 1970s. That is when the deposits arose. 6 7 When was that? I can't recall that. I can't recall a specific trust in the Cayman Islands, no. 82 Q. Are you sure of that Mr. Collins because we are 1 aware that Stokes Kennedy Crowley had advised other 2 people about the establishment of trusts in the 3 Cayman Islands at this time? 4 A. 5 83 Q. 6 A. 7 84 Q. 8 A. 9 85 Q. 10 A. 11 86 Q. 12 A. 13 87 Q. 14 I am not sure of it. You are not sure? I am not sure. It is possible they did? Yes. Sorry? I simply don't recall. You do not recall it? No. Do you recall what was involved in it, the type of trust that would be set up? 15 A. 16 88 Q. 17 No, I don't. Do you recall any reference to discretionary trusts being set up? 18 A. 19 89 Q. Yes? 20 A. Yes. 21 90 Q. 22 A. 23 91 Q. 24 A. 25 92 Q. 26 A. 27 93 Q. 28 A. 29 I simply don't recall. Discretionary? You do recall that? Yes. Tell me what you recall? I recall the word discretionary trust. That they said? Yes. You could establish in the Cayman Islands? I can't honestly say that that it was specifically the Cayman Islands. I know that I set up a trust 1 2 94 Q. No, no. I am not interested about here at all 3 Mr. Collins. 4 Islands. 5 had deposits in Cayman and you said this arose 6 as a result of advice you obtained from 7 Stokes Kennedy Crowley? 8 A. 9 95 Q. 10 A. 12 96 Q. 13 A. 14 97 Q. 15 A. 16 98 Q. 17 Yes. I am asking you now about what they said to you I can't recall what they said to me. But something? About discretionary trusts in the Cayman Islands. But something? Yes, it does. Can you recall whether they indicated to you what a discretionary trust was? 18 A. 19 99 Q. 20 A. 21 They must have. Why must they have? Well, they would hardly outline it to me without explaining it. 100 Q. 23 Had you ever come across a discretionary trust yourself before that? 24 A. 25 101 Q. 26 No. Can you remember any other details they gave you for example about who would execute the Deed? 27 A. 28 102 Q. 29 We are talking about the fact that you about discretionary trusts in the Cayman Islands? 11 22 We are talking about the Cayman No, I don't. You do not recall them indicating that the Deed would not be executed, need not be executed, by you 1 but it could be executed by somebody in the Cayman 2 Islands? 3 A. 4 103 Q. 5 I don't recall that. You do not recall that. You do not recall any of the details about that? 6 A. 7 104 Q. I don't, no. Mary, page 75 please. I want you to look at some 8 correspondence, a letter. 9 Handed) 10 A. 11 105 Q. 12 It is page 69 (Same (Exhibit 2)? Yes. This is addressed to Mr. Frank Lee at Westboro, Montenotte, Cork, Ireland. Who is Mr. Lee? 13 A. 14 106 Q. 15 A. 16 107 Q. 17 A. 18 108 Q. 19 A. 20 109 Q. He acted as an accountant? 21 A. He acted as an accountant. 22 110 Q. Yes. Was Westboro your offices? 23 A. Yes. That was the name of the house. 24 111 Q. 25 A. 26 112 Q. 27 Mr. Lee worked for me at my office at Westboro. What was he? He was a Financial Officer. Was he an accountant or anything? Well, he never qualified. But he was...(INTERJECTION)? He was a — you know. It was your house, was it? No. Sorry. It was the name of the house in which the business...(INTERJECTION)? 28 A. 29 113 Q. It is where my office was, yes. Where your office was? 1 2 114 Q. 3 A. 5 115 Q. 6 A. 7 Yes. Would you tell me about that? I recall those. I assume they were used to hold some of those deposits. 116 Q. 9 No, no. Tell me about it? Tell me about Redhall Trust? 10 A. 11 117 Q. 12 13 You see this refers to a trust "Redhall Trust" and "Redhall Investment Limited"? 4 8 Very well. I recognise the name. However, tell me more than that. came to be established in the Cayman Islands? A. I assume by SKC. There were a lot of companies 14 effectively pulled off shelves. 15 them. 16 How was it that it 118 Q. 17 That was one of I remember the name. Tell me about it then? What do you remember about it? 18 A. 19 119 Q. 20 A. 21 120 Q. 22 A. 23 121 Q. 24 I assume it held monies on deposit belonging to me. Pardon? I assume it held monies on deposit belonging to me. What monies? The proceeds of the sale of US securities. Perhaps, you would tell me then a bit about that. This was apparently a trust established, was it? 25 A. 26 122 Q. 27 I don't recall it as such as a trust. Yes. However, it must have got some...(INTERJECTION)? 28 A. 29 123 Q. It... (INTERJECTION) . It must have got funds. I mean look at 1 2 3 124 Q. 4 A. 5 125 Q. 6 A. 7 126 Q. 8 A. 9 127 Q. 10 A. 11 Look over the page? Right. You see the accounts over the page? Yes. Balance sheet, profits it made in 1975/1976? Yes. Tell me about how it was established Mr. Collins? I assume it was established between SKC and Guinness & Mahon. 12 128 Q. Yes. 13 A. Yes. 14 129 Q. 15 A. 16 130 Q. 17 A. 18 Mr. Lee or you got accounts about it? Where did it get its funds from? From me. Do you recall what funds you gave it and when? Specifically, no, but they would have been the sale of US securities. 19 131 Q. 20 A. 21 132 Q. 22 A. 23 133 Q. You sold US securities? Sold some. Some? If not all at some stage, yes, securities. Some of the securities then were sold and were 24 deposited then or transferred to Guinness Mahon 25 Cayman Trust Limited? 26 A. 27 134 Q. 28 29 Yes. Did you know Guinness Mahon Cayman Trust Limited was a trustee company? 1 135 Q. You must have. Can you explain to me how this 2 Redhall Trust was established and apparently 3 Guinness Mahon Cayman Trust was managing it? 4 A. 5 It would have been established by SKC in conjunction with Guinness & Mahon. 6 136 Q. 7 A. 8 137 Q. 9 A. 10 138 Q. 11 A. 12 139 Q. 13 A. 14 On your instructions? Yes, on the foot of their advice. Yes. You did instruct them to so establish it? Yes. Can you remember that now? Instructing them? Yes? What I can remember is the advice being given and accepted and, "Yes, go ahead." 15 140 Q. 16 A. 17 141 Q. What was the advice? The advice was to keep the monies out of Ireland. No, no. It is much more specific than that. What 18 advice were you given and you said, 19 relation to the establishment of the Redhall Trust? 20 A. 21 The advice I was given I assume was to do it in this manner. 22 142 Q. 23 A. 24 143 Q. 25 A. 26 144 Q. 27 A. 28 145 Q. 29 A. "Go ahead", in What manner? They already had...(INTERJECTION). What manner? Setting up this trust. Yes? Or deposit. No, no? With Guinness & Mahon. 1 146 Q No, no. 2 A Right. 3 147 Q Let us not -- let us be more specific? You do not set up a deposit. 4 deposit. 5 Mr. Collins? 6 A 7 Was this not a trust established I can't honestly say it was. A trust is something that goes on. 8 148 Q 9 A 10 11 You put money on What can you honestly say then? It was a vehicle to take monies that I gave it for deposit. 149 Q 12 As far as you know then was that money was on deposit? 13 A 14 150 Q 15 A 16 151 Q Yes . Would you have a look at the accounts? Yes . Where does it show in these accounts that the 17 Redhall Trust had money on deposit? 18 at the last page or the second last page. 19 last page. 20 affairs. 21 shares in Redhall Investments. 22 Agar International and the current account. 23 the trust? 24 A 25 152 Q 26 A 27 153 Q 29 A Yes, the It is The Redhall Trust statement of It is capital 1,064.45. The assets: 1,000 That is Is that not so? That is what it says, yes. There was a trust and that is the statement of Obviously. 100 shares in Yes . affairs of the trust in 1976? 28 Would you look 1 154 Q 2 A 3 155 Q 4 Yes . Then it appears that the trust held 100 shares in Redhall Investments? 5 A 6 156 Q Yes . It looks then as if Redhall Investments then was the 7 vehicle which carried on, held, the funds, is that 8 not so? 9 A 10 157 Q 11 A 12 Yes . What was Agar International Limited? Agar I think was another company set up, just holding deposits. 13 158 Q 14 A 15 159 Q 16 A 17 160 Q 18 A 19 161 Q 20 A 21 162 Q 22 A 23 163 Q 24 Holding deposits? Yes . Where were the deposits? Pardon? Where were the deposits? I presume GMCT. Yes. Who was the beneficial owner of these funds? I had funds and a brother of mine had funds there. No, these particular ones? Yes . That were being sent to Mr. Frank Lee on your behalf? 25 A 26 164 Q 27 A 28 165 Q 29 A I think...(INTERJECTION). Who owned these? I think Agar, in fact, was my brothers. Yes? 1 166 Q 2 A 3 167 Q 4 A 5 168 Q 6 A 7 169 Q Redhall, is it? Yes ? I would think so, yes. Yes. Is that Dr. Collins, your brother? Yes . Can I refer you back to your letter in reply to us, 8 of the 4th April. 9 3) : 10 You see over the page (Exhibit "With regard to specific queries raised in Appendix C the following is the situation to the best of my knowledge" 11 12 13 14 and then number one. 15 answer to the question: 16 Number one Mr. Collins was in "If you caused to be executed a Deed of Trust or other instrument with the Cayman Islands." 17 18 19 A. 20 170 Q. 21 Yes . And you say: "A trust, Lynbrett, was set up by G & M in the early 1980s." 22 23 And then you finish by saying: 24 "I am not aware of any other trust." 25 26 That is not correct, is it? 27 A. 28 171 Q. 29 A. No, it is not, no. Yes? 1 172 Q 2 How did it come about that an incorrect statement was made? 3 A 4 173 Q 5 A 6 174 Q Because I was mistaken. I didn't recall it. You did not recall it? No. Are there any other trusts, besides the Redhall 7 Trust, that you think may have been established in 8 the Cayman Islands? 9 A I am not aware. All I know is that companies like 10 Redhall Trust -- I don't think they ever operated as 11 trusts in my understanding. 12 there after the mid to late 1970s. 13 175 Q Nothing was ever left Have you talked to any of the accountants who were 14 involved in assisting you at this time about this 15 requirement that we had of you and the fact that you 16 had to give evidence here? 17 A 18 176 Q 19 20 No. Would you try to get assistance for them as to what was done? A 21 Yes, but as you know they are -- well, sorry, maybe you don't know. 22 177 Q 23 A 24 178 Q 25 A 26 179 Q 27 A 28 180 Q 29 A No. They are not with SKC any longer. They are retired? Yes . However, they are available? Yes . Mr. Spain is available? Right. Will you...(INTERJECTION)? 1 181 Q 2 A 3 182 Q 4 A 5 183 Q 6 7 Do you think you could get assistance from them? I am quite sure. In detailing to us the trusts that were established? Right. Have you contacted "Ansbacher" itself and asked them for any documents? A I have numerous unanswered written requests to "Ansbacher" -- sorry, Guinness & Mahon. 8 9 184 Q In Dublin? 10 A In Dublin. 11 185 Q 12 A 13 186 Q 14 A 15 187 Q What about "Ansbacher"? No. You have not written to them? No. Could I suggest Mr. Collins that you should write to 16 them and ask them for their records in relation 17 to the dealings which you had with them and any 18 correspondence they may have in relation to those 19 dealings including the establishment of trusts? 20 A 21 188 Q Okay. What I would like you to do also Mr. Collins is to 22 give us details about all of the other companies 23 that were established by you or on your behalf in 24 the Cayman Islands, and their relationship with this 25 trust. 26 some of the names of these companies who were 27 established in the Cayman Islands? 28 Ponderosa was a name I remember. 29 you know, if I heard them I ...(INTERJECTION). Who owned the shares? Can you remember now There were a few, 1 189 Q 2 A 3 190 Q 4 A 5 191 Q 6 A 7 192 Q 8 A 9 193 Q 10 A 11 194 Q 12 A 13 195 Q 14 A 15 196 Q 16 A 17 18 Tamarin Holdings? Tamarin, yes. Holdings ? Yes . Cayman Realtor? Who? Cayman Realtor(sic)? Realtor, is it? Yes ? I remember that, yes, yes. Yes. Neptune Investments? Yes . Agar Investments? Yes . Delta Investments? No. I see it here but that does not ring a bell with me, Delta. 197 Q 19 You have mentioned Ponderosa. What about "Seine", a company called Seine? 20 A 21 198 Q 22 A 23 199 Q How do you spell that? S-e-i-n-e, a French river apparently? No. There may be others. However, we would ask you to 24 explain to us when these companies were established; 25 what they were established for; and what their 26 relationship were with -- who owned the shares in 27 these companies; and what their relationships were 28 with any trust that was established. 29 one of the questions that we raised with you was the Mr. Collins, 1 use of deposits in the name of Guinness Mahon Cayman 2 Trust, and later "Ansbacher", in Guinness Mahon here 3 in Ireland as security for loans to you or your 4 company. 5 I do. 6 200 Q Yes. Do you remember that question? Could I just refer you to your answer. 7 the second page. 8 second page 9 A 10 201 Q 11 It is Sorry, it is number four on the (Exhibit 3)? Yes . That is in answer, if you turn back to the long letter, to page 12 of the long letter (Exhibit 1)? 12 A 13 202 Q 14 Yes . It reads: "Another service apparently offered by the Company in relation to deposits maintained with it by Irish residents was as follows:- 15 16 Guinness and Mahon (Ireland) Ltd provided loan and guarantee facilities to Irish residents or to bodies corporate which they controlled or in which they had an interest secured by cash deposits with the Company. It appears to have been an important feature of this service that this security was not referred to in the loan agreement." 17 18 19 20 21 22 23 You are very familiar I am sure with this concept of 24 back to back? 25 A 26 203 Q 27 A 28 204 Q 29 Yes . And cash secured? Yes . Your answer to that was: "I did not avail of this service"? 1 2 3 I don't recall availing of any back to back service. 205 Q 4 I think, again, Mr. Collins that your memory is incorrect ? 5 A 6 206 Q Okay. Mr. Collins, we have a document prepared by 7 Guinness & Mahon, which is their management report 8 of the 31st October 1974, and it refers to all loans 9 which were, in the phrase that they use, "suitably 10 secured" and it gives you and as "Mr. C. J. 11 Collins," as "£301,000". 12 loan from Guinness & Mahon in October 1974 of that 13 amount 14 A 15 207 Q 16 A 17 208 Q Can you remember getting a (Exhibit 4)? No, I can't. You cannot? No. Our investigations indicate that in the 18 Guinness & Mahon records where the phrase "suitable 19 secured" appears that this means that it was cash 20 backed by a deposit in the Cayman Islands? 21 A 22 209 Q 23 A 24 210 Q 25 No. You have no recollection of that? No. I want you to refer to another document on page 45. Have you got that (Same handed) 26 A 27 211 Q (Exhibit 5)? Yes . Mr. Collins, I just want to explain to you about 28 this document. 29 Guinness & Mahon to The Central Bank? This is an internal memorandum from 1 2 212 Q 3 A 4 213 Q 5 Yes . I should tell you that it is dated -- it is not from this document but it is February 197 6: 6 "Neil Collins 7 Mr. Collins is a close business colleague..." - £324,000. 8 9 And he sets out your relationship there. 10 Then it goes on: 11 "...The loan is for personal reasons and is secured by a deposit (held by Guinness Mahon Cayman Trust Company Limited) equal in amount to the balance of the loan"? 12 13 14 15 A Well, all I can say to you is that they are totally 16 wrong on the first statement that they have made in 17 that. 18 214 Q 19 A 20 So, maybe they are incorrect in the second one as well. I don't recall. 21 215 Q 22 A 23 216 Q 24 A 25 217 Q 26 A 27 218 Q 28 A 29 Yes ? You do not recall it? No. Did you get a loan at that time...(INTERJECTION)? If I had a loan, yes, I did. You did? Yes . Was it in that region of that, £300,000? I don't recall. I want to know the circumstances. If I knew what the loan was for I could be quite 1 specific. 2 219 Q 3 A 4 220 Q I know it is very hard to remember back Mr. Collins? Yes . However, is a substantial sum of money. It says 5 here that it was required for personal reasons. 6 Could there have been other loans that you obtained 7 from Guinness & Mahon at that time? 8 A 9 1970s, into the very early 1980s. 10 221 Q 11 A 12 13 Yes. However, of a personal loan to yourself? 1974 . MS. MACKEY: A 14 197 6. 222 Q 16 A 17 1976. I know I bought a farm in Cork sometime in the 1970s. 15 18 I had a lot of dealings with Guinness & Mahon in the It could have been that. MR. JUSTICE COSTELLO: something like that. 223 Q You cannot remember if you got a loan for that purpose. 20 would have given? A 22 You cannot remember what security you No, I would have thought that it would have been secured on the Deeds of the farm itself. 23 224 Q 24 A 25 Yes ? I know I had two banks involved in that. One was AIB. 26 225 Q 27 A 28 226 Q 29 It could have been that? Maybe the personal level would suggest that it was 19 21 I am not sure. If this statement is not incorrect? Yes . This is a statement made by Guinness & Mahon to The Central Bank stating that there was a loan for 1 personal use and secured by a deposit of Cayman, 2 Guinness Mahon Cayman Trust Company? 3 A. 4 227 Q. 5 A. 6 228 Q. Right. You do not remember that? I don't. Yes. Did you know Mr. Collins that you had in 7 Guinness & Mahon here in Dublin -- that there were 8 coded accounts in your name? 9 A. 10 229 Q. 11 A. 12 230 Q. 13 A. 14 231 Q. Coded? Coded accounts, yes? No, I don't know that. Have you learned it since? No. Did you know that there were a number of accounts 15 which related to you as sub-accounts of a main 16 Guinness Mahon Cayman Trust account, later 17 "Ansbacher" account, in Guinness & Mahon here in 18 Dublin? 19 A. 20 232 Q. 21 A. 22 233 Q. No. You did not? No. What we will require Mr. Collins from you is details 23 along the lines we have indicated, along the lines I 24 have indicated, to you. 25 to also deal in your statement with more recent 26 developments. 27 dealings with Guinness & Mahon here in Ireland? 28 A. 29 234 Q. However, I would like you You say you had very considerable Yes. What I am, what we are, concerned about, of course, 1 is insofar as those relations had involved the 2 Guinness Mahon Cayman Trust. 3 relation to that. 4 I do. 5 235 Q We wish particulars in Do you understand that? In that connection we sent you a letter 6 recently about Mr. Neil McCann, a letter signed 7 by Mr. Neil McCann. 8 A 9 236 Q 10 A 11 237 Q 12 A Do you remember? I got that last Friday (Exhibit 6). Yes ? So, it didn't give me time to respond. Yes. What can you -- how can you help us on that? I presume that was an investment I made 13 in Dundalk Shopping Centre. 14 Phil Monahan were shareholders. 15 238 Q 16 A 17 239 Q 18 A 19 240 Q 20 Alex Spain and Sorry, will you just take it slowly? Okay. What year was this? I will have to be guided by his letter now. No, I am afraid not because there is not a date there ? 21 A 22 241 Q 23 A I would say mid 1970s. Yes. What was the development Mr. Collins? This was a property company that they were jointly 24 involved in with Neil McCann. 25 shopping centres in Dundalk and Athlone. 26 242 Q 27 A 28 243 Q 29 A They developed Do you remember the name of the company? I think it was Dundalk Shopping Centre Limited. Yes. Tell me what happened? Well, for whatever reason known to Neil McCann and 32 1 2 244 Q 3 A 4 Yes ? And they put a proposal to me. Alex Spain...(INTERJECTION). 5 245 Q 6 A Who did? Alex Spain and Phil Monahan put a proposal to me, 7 Alex was shareholder and advisor to both and to 8 Neil McCann I gather, to buy a block of shares in 9 this company, which I did. 10 246 Q 11 A 12 247 Q 13 A 14 15 Which company? In Dundalk Shopping Centre Limited. Yes ? I bought shares. I know nothing about Blue Limited or any of that. 248 Q This was a letter authorising you to transfer to 16 Neil Collins or his nominees the entire share 17 capital of Blue Limited? 18 A 19 249 Q 20 A 21 22 Did this not happen then? I got the shares in Dundalk Shopping Centre Limited, which is what I purchased. 250 Q 23 24 Right. Yes. What about the company Blue Limited in...(INTERJECTION)? A 25 I am afraid Alex Spain or Neil McCann are the only people -- I certainly don't. 26 251 Q 27 A 28 252 Q 29 A You know nothing about that? Nothing whatsoever. Yes? I never even heard of the name. 1 253 Q 2 Mr. Spain then was involved in this in advising you and advising Mr. McCann as well I take it? 3 A Yes, and himself. 4 254 Q And himself, yes? 5 A 6 255 Q 7 A 8 256 Q 9 And I never met Mr. McCann during that time. Did you know him in fact? At that time, no. Yes. I meet him subsequently. It would appear Mr. Collins that you were associated with a company called 10 Broadway Securities Limited. 11 remember...(INTERJECTION)? 12 A 13 257 Q 14 A Do you I remember the name, yes. What was it? I think Broadway was a company set up by Guinness & 15 Mahon where we joint ventured on a property purchase 16 in the U S . 17 258 Q 18 A 19 I think it was a site which ultimately was never developed but sold on. 20 259 Q 21 A 22 260 Q 23 A 24 261 Q 25 A 26 27 Yes ? Yes . At a loss. Well...(INTERJECTION)? I think that was Broadway. What was your interest in Broadway do you remember? Specifically, no, I don't. It was a joint venture with Guinness & Mahon. 262 Q Yes. Can you tell me also, and also develop in your 28 statement, the undertaking called Gene Morris & Co. 29 Ltd., in Georgia in the USA, your relations with 1 2 A. 3 Guinness & Mahon. 4 263 Q. 5 A. 6 264 Q. 7 A. 8 265 Q. 9 A. 10 266 Q. 11 Yes? That was a retail store or stores. Yes. What was your involvement in that Mr. Collins? Shareholder. In what? In Gene Morris & Co. Was it not a company called Spartacus Holdings Limited? 12 A. 13 267 Q. 14 A. 15 268 Q. 16 Right. Involved in that? Yes. You see Mr. Collins we will want you to give us full information about all of these transactions? 17 A. 18 269 Q. 19 A. Yes. Tell me about Spartacus Holdings? It was another shelf company that I used that came from...(INTERJECTION). 20 21 270 Q. 22 A. 23 Tell me how you used it? What did you use it for? I certainly used it for some investments as the vehicle. 24 271 Q. 25 A. 26 272 Q. 27 A. 28 273 Q. 29 That was another joint venture between myself and Yes. You were the owner of the company? Yes. Do you know when it was established? Not without the record I don't. You could make enquiries, could you not? 1 274 Q Yes. I take it you could make enquiries in the 2 Cayman Islands if necessary to find out when these 3 different entities were established? 4 A 5 275 Q 6 A 7 276 Q 8 This would have come through SKC. SKC can help you? Yes . Yes. When you say "This would have come through SKC", Spartacus Holdings? 9 A 10 277 Q 11 A 12 278 Q 13 A 14 279 Q 15 Most of those names and companies. Yes ? Began life with SKC. Yes. It was on their advice then? Yes . You can then contact them and see what -- how they can help you? 16 A 17 280 Q Yes . Perhaps Mr. Collins we might take a break now if 18 that suits you for a cup of coffee? 19 all right? 20 A 21 281 Q 22 A 23 282 Q Would that be Fine . About 10 minutes or so? Okay. Will I stay here? If you would. Yes, if you would not mind we will go 24 out. 25 SHORT ADJOURNMENT 26 27 28 29 MR. JUSTICE COSTELLO: Mr. Collins, just a few more questions, am I correct in saying that the company that you were 1 involved in was called Westboro Investments Limited? 2 A. 3 284 Q. 4 A. 5 285 Q. 6 Was it an Irish registered company? Yes. You obtained loans, I think, from Guinness Mahon here in Ireland in respect of that? 7 A. 8 286 Q. 9 10 Yes. Yes. So, that company had no involvement with the Cayman Island account? A. No, but it may have had investments jointly with 11 Guinness Mahon going through the exchange control 12 regulations in the US. 13 287 Q. 14 A. 15 288 Q. Directly with Cayman, no. Directly with Cayman, no? No. I would also require, Mr. Collins, a detailed 16 statement that we would like you to give us. 17 relationship with Ascot Security Limited? 18 A. 19 289 Q. 20 Your Yes. This was a company, I think, which bought shares in Atlantic Resources? 21 A. 22 290 Q. 23 A. 24 291 Q. Yes. Were you a director of Atlantic Resources? Yes. I would like you to give us a full account of that 25 and also any documentation that you may be able to 26 get from Stokes Kennedy Crowley if they were 27 involved in relation to that? 28 A. 29 2 92 Q. Yes. Can you tell me what you recall now of the Lynbrett 1 Trust? 2 Lynbrett was set up by Guinness & Mahon. 3 a property development in Arizona that five 4 individuals got involved in, and I was one of them. 5 Guinness & Mahon set up the trust. 6 293 Q 7 A 8 294 Q 9 There was Well, we can just pause there? Yes . It was a trust, there was a declaration of trust made by Guinness & Mahon Cayman Trust Limited? 10 A 11 295 Q 12 A 13 296 Q Yes . The company in the Cayman Islands? Right. Do you know whether your advisors were involved in 14 drafting that trust or negotiating the drafting of 15 the trust? 16 A 17 18 I do not think so, unless they were used by one of the other four individuals, but I do not recall. 297 Q 19 Indeed one of the companies named as a beneficiary of the trust was Spartacus Holdings Limited? 20 A 21 298 Q 22 A 23 299 Q 24 A 25 Yes . That is your company? That is my company, yes. That was registered in the Cayman Islands? I can't honestly say whether it was or not, but it was my company. 26 300 Q 27 A 28 301 Q 29 A Who could say? SKC. You will find out from them? 1 302 Q This was a very big property development. Did you 2 have anybody advising you on the establishment of 3 the legal documents that were involved? 4 A 5 303 Q On the development itself? No, no, on this trust deed that was to be 6 established and the relationship between each of the 7 other people involved here and in Ireland. 8 have no legal advisor? 9 A I am trying to think. I did not have any legal 10 advisor in the setting up of that trust. 11 take legal advice on that. 12 304 Q 13 I did not Did you leave it then to one of your colleagues to do? 14 A 15 305 Q 16 A 17 18 Did you That is my recall, yes. Who was that? Which of your colleagues was that? It would probably have been Clayton Love or Hugh Coveney. 306 Q 19 Yes. Now, there was a company called Eclipse Holdings Limited, that was one of the beneficiaries? 20 A 21 307 Q 22 A 23 308 Q 24 A 25 Yes . Was that Mr. Coveney's company? I do not know. You do not remember? I do not know. I remember the name. whose company it was. 26 309 Q 27 A 28 310 Q 29 A Yale Securities? I do not know. You do not know whose company? I do not know 1 311 Q 2 Who were the people that were - who were your 4 partners in this? 3 A 4 312 Q 5 A 6 313 Q 7 A 8 314 Q 9 A 10 315 Q 11 A 12 316 Q 13 A 14 317 Q 15 A 16 318 Q Love . What were the names? Coveney...(INTERJECTION). Sorry? Clayton Love. Yes? Hugh Coveney. Yes . Pat Dineen and Frank Boland. Frank Boland? Boland. Not Mr. Ferguson? No. Any of the interest that may have been earned on 17 accounts with which you were interested in here in 18 Ireland, were they returned for tax purposes to the 19 Irish Revenue Authorities? 20 A 21 319 Q 22 A 23 320 Q The accounts here in Ireland? Yes . Yes, everything was. You say you did not know anything about an interest 24 in deposits that Guinness & Mahon Cayman Trust may 25 have had in Ireland? 26 any interest on any deposit which was not in, which 27 was in the name of the Cayman company? 28 29 A You would not have returned No. So, the sub-accounts that I have referred to, any 40 1 interest on those would not have been returned by 2 you? 3 No, not by me. 4 322 Q Yes. I am not aware of sub-accounts. Well, what about the income that was earned on 5 the companies in trusts that you had an interest in 6 in Cayman Islands, were they returned here to the 7 Irish Revenue? 8 A 9 323 Q 10 A 11 324 Q 12 13 I do not think so, no. So, Kennedy Crowley were looking after your affairs? Yes . Very well, Mr. Collins, that is all I have to ask you. A Ms. Mackey may have a few questions? Okay. 14 END OF EXAMINATION OF MR. CORNELIUS COLLINS BY 15 MR. JUSTICE COSTELLO 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 MS. MACKEY: 3 4 MS. MACKEY: Mr. Collins, I would just 5 like you to look again at 6 a document we have already asked you to look at. 7 is page 69 and 70. 8 Guinness & Mahon Cayman Trust 9 A 10 326 Q 11 A 12 327 Q It The letter is to Frank Lee from (Exhibit 2)? Yes . Of 9th December 197 6? Right. If you go down to the third paragraph on the first 13 page which starts "the accompanying Profit and Loss 14 Account." 15 A 16 328 Q Do you see that? Yes . It says: "It is shows merely two items," one is the 17 book profit on exchange resulting from a 18 revaluation of the dollars. 19 "The other item on the Profit and Loss Account is the interest earned on the A/X-4 deposit account prior to the conversion ever the balance of the account into US dollars." 20 21 22 23 24 Do you know what the A/X-4 deposit account is? A No. 25 Well, if you turn over the page, and you look again 26 at the second last paragraph. It refers there: 27 28 29 "Finally, I would a small overdraft of Redhall Trust, expenses over the mention that there is on the bank account and as they will be next two months..." 1 2 Etc., etc., 3 4 5 do you know who Ru Leonard is? 6 Yes . 7 330 Q 8 A 9 331 Q 10 In Guinness & Mahon? Yes . "I propose instructing Ru Leonard to close the A/X-4 call deposit account remitting those funds to us for credit to the current account of Redhall Investments Limited. I take it this action meets with your approval." 11 12 13 14 Now, does it not appear from that that the A/X-4 15 call deposit account is an account in Guinness & 16 Mahon in Dublin with Mr. Leonard was being 17 instructed to close? 18 A 19 332 Q 20 A 21 333 Q 22 It does. Yes? Yes . Does it not appear that it is an account over which Guinness & Mahon Cayman Trust had some power? 23 A 24 334 Q It would appear, yeah. Does it not appear also that the funds in that 25 account appear to belong to Redhall Investments 26 Limited since they are being used to paythe 27 overdraft on the bank account? 28 A 29 335 Q Yes . So in short, does it not seem that this is one of 1 the current accounts here in "Ansbacher", here in 2 Guinness & Mahon, and that it related to your Trust 3 Redhall Trust? 4 It does. 5 336 Q Yes. As you can see from that it appears that 6 interest arose on it, and in fact if you now look at 7 another document. 8 will see is a letter in response from Ru Leonard in 9 Guinness & Mahon to Mr. Furze dated 15th December 10 This is page 77. That as you (Exhibit 7)? 11 A 12 337 Q Yes . Headed Re Rental and Investments, and it is very 13 short, and after thanking him for his letter 14 together with enclosures he said: 15 "As requested I attach draft in the sum of dollars 79,477 representing principle plus interest to date on the A/X-4 deposit. 16 17 18 A 19 338 Q Yes . So, it is clear that the funds in the A/X-4 deposit included interest which had accrued? 20 21 A 22 339 Q Yes . I think you have already told us that you did not 23 return to the Revenue any interest that may have 24 arisen on any ...(INTERJECTION)? 25 A Coded accounts mean nothing to me. 26 27 Not to my knowledge, no. 340 Q Very good. Can you tell us anything about a company 28 called Whitehall? 29 Whitehall? 1 341 Q 2 A 3 342 Q 4 A 5 The name again, yes. What is that? It is one of the names that would have emanated from SKC again, and I remember the name Whitehall. 6 343 Q 7 A 8 9 Yes. Was it a company that you used for any purpose? I remember the name. What it was used for I honestly cannot say. 344 Q 10 Very well. Maybe when you are doing the statement you can check up on that one as well? 11 A 12 345 Q Yes . Yes. Just going back to your own statement for a 13 moment, you say in the third paragraph down, you 14 have it do you (Exhibit 3)? 15 A 16 346 Q 17 Yes . On the first page: "I had deposits with Guinness & Mahon Cayman Trust for a time during the mid '7 0 's ." 18 19 20 A 21 347 Q 22 23 A I can't. When they began and when they ended? I would have to refer to the records again. 25 348 Q 26 A 27 29 Now, can you be more specific with regard to dates there. 24 28 Yes . How did they end? What brought them to an end? They were either invested or withdrawn from Guinness & Mahon and used elsewhere. 349 Q Do you have documents relating to the closing of those accounts and all the documents that you will 1 2 A. 3 350 Q. 4 I do not but, GMCT or Guinness & Mahon should have. So, you say they were either invested or withdrawn by you? 5 A. 6 351 Q. 7 A. Yes. Do you recollect withdrawing them? Not specifically, no, but I know that - I would have 8 thought from sometime in - even before the late 9 '70's my dealing with Guinness & Mahon Cayman Trust 10 11 had wound down. 352 Q. 12 Yes. Wound down. Can you remember any details about the winding down? 13 A. 14 353 Q. 15 A. 16 354 Q. 17 A. No, I can't, sorry. In regard to the Redhall Trust? Yes. Did that come to an end? All of those entities came to an end. 18 any more specific then that. 19 presume, will show. 20 355 Q. 21 A. 22 356 Q. I can't be The records, I You cannot give us any dates on that? No. Just one totally general question for the record, 23 could we just have a brief summary of your own 24 present position? 25 or...(INTERJECTION)? 26 A. 27 357 Q. 28 A. 29 358 Q. Are you currently in business Yes, I am involved in a travel agency in Cork. Yes. What is that called? Heffernan's Travel. Yes. Your position in it? 1 2 359 Q. 3 A. 4 360 Q. 5 A. 6 361 Q. 7 A. You are the MD? Effectively, yes. That is fine? I spend a couple of hours a week in it, so. Thank you very much, Mr. Collins. Thank you. 8 END OF EXAMINATION OF MR. CORNELIUS COLLINS BY 9 MS. MACKEY: 10 11 MR. JUSTICE COSTELLO: Thank you, Mr. Collins, 12 that is all for today. 13 Ms. Cummins will be in touch with you to let you 14 know when the transcript is ready. 15 A. 16 362 Q. 17 A. 19 363 Q. 20 Yes. Then if you want a copy of it we can make it available to you? 21 A. 22 364 Q. 23 A. 3 65 Q . 25 A. 26 366 Q. 27 A. I think it would assist me if I had a copy. Yes. You can get...(INTERJECTION)? In the exercises I have to do. Yes. I need a ...(INTERJECTION). Of course, yes, yes. I presume I can discuss time frame and that...(INTERJECTION). 28 29 Of your evidence, and we would ask you to come in to sign the transcript? 18 24 Yes. 367 Q. Yes, you fix up the arrangement with Ms. Cummins? 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED n CX COLLINS Glenfeeen. Gfanmire. Co Cork. Ireland. Telephone: (021)821535 Fax: (021)866088 CJC/gh 4th April, 2000 Office of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Limited, 3rd Floor, Trident House, Blackrock, Co. Dublin. Dear Sirs, I refer to your letter of the 20th January, 2000 and hereby set out my statement as requested. . I had extensive dealings with Guinness & Mahon from the 1970’s to the late 1980’s I had deposits with Guinness & Mahon Cayman Trust for a time during the mid 1970's These deposits contained monies gifted to me by a relative who Uved and worked outside of the State. These gifts were reported to the Revenue Authorities here and all relevant taxes paid. The decision to keep the monies on deposit abroad was based on the best professional advice available at the time. With regard to the request for any books and documents, I have no such records in my possession save for copies of documents sent to me by G & M. G & M have forwarded documents to both the Me Cracken and Mortarty Tribunals. Despite repeated requests by me G & M have failed to confirm that I have been furnished with copies of everything they have sent to the two Tribunals. in the late 1980’s I lost everything as I had to sell off ail my assets to repay Banks on foot of personal guarantees. I also lost my home in that I had to hand over the Title Deeds to Allied Irish Banks as security for an outstanding debt of £400,000.00 and I had to dispose of the building that I operated from. In addition I reached a full and final agreement with the Revenue. Consequently there was no reason, after a period, to hold on to any records that I had stored. If Guinness & Mahon have not already supplied you with all their records relating to my dealings with them I would ask that you request them to do so. In this regard. I attach a letter of authorisation. c> n C.J. COLLINS Glenfeeen. Glanmire. Ca Cork Ireland. Telephone: (021)821535 Fax: (021)866088 With regard to the specific queries raised in Appendix C the following is the situation to the best of my knowledge. 1. A trust, Lynbrett. w as set up by G & M in the early 1980’s a s a vehicle for an investment in a property development in the US. I w as one of five that participated in that development. I am not aware of any other trust. 2. I did not avail of this service. I have no knowledge of Amiens Securities Ltd., Amiens Investments Ltd or Kentford Securities Ltd., . 3. I never had any dealings with Irish Intercontinental Bank Limited. 4. I did not avail of this service. 5. No - 1 never had dealings with Irish Intercontinental Bank Limited or Kredietbank N.V 6. In the c a se of Lynbrett I assum e G & M sought and obtained exchange control permission. 7. I do not recall any dealings with Guinness & Mahon Jersey Limited or Guinness & Mahon Channel Islands. Limited. However College Trustees Limited se e m s to be a familiar name, but it may simply have been used by Guinness & Mahon in som e property transaction or joint venture w e were involved in. 8. i know of no such bodies. . J Finally in 1 9 8 4 1 requested a borrowing facility from Guinness & Mahon to purchase shares in Atlantic Resources to be secured by the shares. The facility was granted and the vehicle used by Guinness & Mahon was Guinness Mahon Cayman Trust. Yours faithfully, . w GUINNESS MAHON CAYMAN TRUST LIMIT© A Ui» Guinn*** Mahon Mwehwt Banking Omup Tikphon* Na #— «ZS3M -- - . yaurN* aurnr ' JMF/££ ttfr Vecembe/t, 1976 ik. Etami Ue. .VWtAtfcMO ..Mflniowette « Cotk ' . TBELAUO 1. .tfcd* FJiaxk, XEPHALL INVESntBtlS LJH&W VEDHALL T8BST'................. Z now have. pJUxtaxAz in «4 * t 3MA Ncv«£>«a fofcutg* ^ e ^ b te o a /te rf « i a -iee * U M * has been a 4£fcfct Aet&a« i 3^ M u ^ ^ ^ a a w i l l n o tc c .1 an In cA zsu e. i* i/ti ^X-4 'i balance, by v ix tu e . o{ th e . i n t i x e A t a llo w e d p U o /i t o c o n v e /iU o tti ‘ ' Ibu Tuank'Ut ttkVtzmbvl , 1976 fagt 1 On tht auuntion that goa.toUl litin a ptuit&on to agfitt.tht Stirling //*..»«* ikom ix tht tneleied accounts, wt ktwi ww tomiAtad tit 1 TZk L**a ±o U.S. dollafU tt anixctongt *ott o{ 7.65. AHo vuilo&td aJit rJ‘-/w"‘*x & 30th. UovtaSvL tzpuMtd in OJt. doltoJU, and! - ■■ ourooit tJuct tkut io*m tkt &uXs o{ totnJu. nccmnt&'jtg. V&hapi goa. ■matdbt. fund enough to lit ve know u/utStA. you agKzt. thtit {igtuu ; and also advise, we i{ you kaut ang qtwiiti. . Tainina hou to tkt accoiwU oi UdhUt T w t , 1 totin txaetlg tkt, imt Mtmcfc cneloting euieounti (thick t tkUk goa tolU {fad iU{txoLvMtofig ' both in Pound StvdJCng *nd in U.S. doltOJU. Once again, pvJupt you ■ would bt kind enough to uagoo*. agKzxmtxt to mt doZlMt figutti 4o that ut can. eniuU you*. KteamU agttt aUth own. ' finally. 7 mold motXloK that tkt/it i* a small meAdM{t at tht bank aaaoaM oi Redhall TJtuU «d as tkext milt it zxptnitt* ovtt tkt tuxt too Hffnfft" in tkt £*** oi GavtXmtxL {ttS, its.{ok Kedhatl Jnvestmtnts Limited. 1 puipoit Jj^fruating fci LtomJtd to ctoie. tht A/X~4 eotl depositaccount remitting thost ^utuiA to ui {ai audit to tht ctuuent 0£ ftutestuenti united. I takt it this action meets uitk gouA.approval. Oven, tht aowut o{ tht not {eo dags, 1 Hilt bt uniting to gou,tending sixilaK '’*«'»•»botk in Poutid Sttkling and U.S. dollaJii (oA tkt va/Uoos entttfa* uitk which imtant mutually involved. Vouas sine&ulg. S A e et tpOiJt - US$ Uzz Uotz 2) CuMoit Xe.a>ant 1 6 ,4 6 3 .7 6 790.5.1 . 1 2 .9 4 U S 4 ltt, 149.43 N o te j The. U .S . O o lla /i f ix e d D e p o s it io u p ia c t d oh d z p o i-it v a tu t 1 5 t h GetobeA 1 976, a a tu Ju n g 1 5 t h A p U l 19 7 7 a t 71 p . t . Hatt t ■ Tht U.S. VollaJL Call Deposit mi pia&td on dtpo&it valuz Zith OctobtA 1916 at 4 1/St jo.a. . gawAit zmsrmrrs norm? " Aitfl&rtXl H Ladiu * Koftfttt TJtaU t 1,464.45 V ttta . H a teb tg i L td . taftu.ui^s .. . . . . =4 xzuunLL rausr{em' ?warm: . . 4635.12 100.60 .. 606.06 a 160.94) - . . . . -.., ?645.12 unusa- fr?? 1 . 4 g?gu'l farm? 165.00 1,000.90 (200.55! a Ln u.s; . . 10a Lad' Sm? 0? i, roan Tate/?mm m- aunxcat 1,064.45 .. 7 meammay Miltown Grange, C astlabellin& haa, Co. Loath. Th e D ir e c t o r s , . . Guinness & Mahon Caymaij T r u s t L im ite d , P.O. Bo* 887, . , Grand Cayman, B r i t i s h Vast In d ie s . D e a r‘S i r s , . ' . I r e f e r to a Seed o£ S e ttlem en t dated 31at M arch, 1972, v h e ra b y Jo h n ■ .Andrew Tu rx e appo inted Guinness and Mahon Cayman T r u s t L im ite d as T ru s te e ? o f a Settlem ent f o r th e b e n e fit o f t h e 'is s u e o f th e la t a C h evies McCann R o s e t t a McCann. ' ‘ • In t h e i r c a p a c ity aa Tru s te e s * Guinness & Mahon Cayman T r u a t L im ite d , th ro u g h t h e ir nominees own the e n t ir e issued share c a p it a l o f B in e L im ite d . 1 he re by a u th o ris e yo u t o t r a n s f e r a t p a r t o 'f r a i l C o l l i n s fer h i* nomlnaa th e e n tire issued- share c a p it a l o f B lu e Lim ite d .. .......’ ' ' Yours faithfully. ' R a il - V . McCann A. . r\ r * Y Cut Hifi TFU-tAB 15th . it* J.A.Furfca, lsq « » GalruMss Mahon CivyMui Trtwt Ltd., P.O.Box. 887, Grand CaypM, SH WEST U P I6 S . t e a r John, - I thank you f o r y ea r l « t t a r datad 9 t h . Oacanbar, 1976, t o g r H w w ith afieloau raa. A* raqaaatad I a tta c h d r a f t In th * • « o f O oHara 7 9 4 ,7 7 f n u p rm m tln g p r in c ip a l p lu s T rttarw t t o d a ta on tha3fi$6 " ‘ Yours s ln e a r a ly . T X ACCOUNTS. Enc/I. TELKX M ES4A 6B ' TO: ' J.A.Furze, Esq.* Guinness Mahon Cayman Trust Ltd., DATE: 17th. November, 1976 ‘ TEST: RE: T A M A R IN . H a v e sp o k e n to F.L. w h o confirms t h a t yo u should* proceed as . s u g gest ed trt y o u r telex. ' ' _ I a w a i t y o u r Instructions on A/XI an d A A 3 . ) Regards, R u L e o n a r d .. A U T H O R I S E D BY: DEBIT: COST: . .j ^ r y *» r ^ J k. ^ + FL/hm 29th June. 1 9 7 6 8 .. Leonard'. E s q . . G u i n n e s s lc M a h o n L t d . . 17 C o l l e g e G r e e n , D u b l i n 2. S e a r Ru, I w o u l d b « obliged if y o u c o u l d lot m e h a v e a sterling c h e q u e for tbs U . S. dollar equivalent of .$862.65 p a y a b l e to R e f f e r a a n c T r a v e l Ltd. Y o u c o u l d a r r a n g e w i t h J o h n T u r a e to let y o u h a v e a c h e q u e to c o v e r this a m o u n t , a n d debit s a m e to T a x n a x i n H o l d i n g s Ltd. T o u r s sincerely* c. c. M r . J o h n A . P u r s e o o Kennedy Crowley & C o . Chartered Accountants H a r c o u r t H o u s e Harcourt Street Dublin 9 Telephone (01 ) 757971 T d e x 4 4 S 4 t.. Ylnca&t Waiah, Kaq.p A r t h u r Coat * Co** 4 2 * St. S t a p h a n ' a Gxaan, D u b l i n , 2. AJ8/BB ■ 5 t h J a n u a r y , 1973. a n . Wfaica a a d J B l w « u i f Sa a r Yincaots ."• ■ ■••■ •••:•.i''&.li*72f thk lMd, Whita. a n d ■ : ' - W l a A ,' » a M L i m i t e d j •••* .*»>•:: r•.. - u u & i d -■ ■ ■ ':• T x t t t t ^ fridfip' x-va*taefr-jitena»Bopr — >**..* b e o a f i c l a x y ..i -.-■ v.:’ .': : r-.-.' i r r i t t « & 'to N a l l . M c C a i m V a n d P h i W - P H o n*f>4n*k w .■ ; .■ ‘ - s • a r i s i n g •. = .*..i fcwrAvwc* v*p-. • > - . *t .7 -i; bjc.-V.Wr.-ci-■ •-■ -;C Iha'pdwara safarrad to i n the l a s t paragraph w h i c h h a v e b a a a • i t r W b c a b l y g r a n t e d to y o u * r a t h e p o v f w g •«£; the. Settlo r, t h e . .... p r i n c i p a l p o w e r b a l n g th a p o w e r to repliweythe, T r u s t e e s . Tha S e t tlor w a a a Cayman Lavyar. . . •. i h o p a t h a t t his w i l l b a l a o r d e r w i t h y o u a n d s h o u l d y o u r e q u i r e a n y further i n t o n a t i o n , o r a copy o f tha original doeoaaata, p l e a a e l a t aia ‘ know. ' ' ' W i t h a w e x y g o o d wish. ■ ' Y o u s a sincer e l y . ▲ lax. Spain. e e: H a i l V . M c C a n n , E a q . ^ P h i l i p M o n a h a n , Xaq. >;v * r U - ' .............................................. ...................................................................................Limited hereby notifies tha specify nature of change. If consisis of the ent of a new or Secretary also particulars below. cjvv r V. \vi’-d su b sid iaries e ith e r of th e com pany, or of a n o th e r body co rp o rate of w hich th e com pany is th e w holly-ow ned s u b sid ia ry . A body co rp o rate is deem ed to be th e w holly-ow ned su b sid ia ry of a n o th e r if i t h a s no and th a t o th e r’s wholly-owned su b sid iaries a n d its or th e ir nom inees. If th e space pro v id ed in th e form is insufficient, p a r tic u la r s of o th e r d ire cto rsh ip s should be listed on a se p a ra te s ta te m e n t a tta c h e d to th is form tin i? in a firm are jo in t secretaries, the nam e an d p rin c ip a l office of th e firm m ay be stated. iQ sipr.cMl by a d ire cto r or the secretary. COMPANIbS ACr, 1963 Form N o. 45. I Hwpeled .... *$.73; MMh fymHm 1 Mow). M tdt fmrmml a SKtUH W . (T o bo lie d w ilh ibe H cfix n ir w ithin Mae m onth after th e allotm ent is m ade). tN u n b cx o f the S h u n allotted payable in cash ■* •» 1 »» M N om inal am ount o f the S h a ra 10 allo tted i »« I* II ft! .,, "" _ Jst. —* A m ount paid oc due and peyabl* o n each such S hare jL l N um ber o f Shares allotted 6 r a a u M r o lw other th an cash N om inal am ount o f the Shane to allotted _ A m ount to be treated as paid oa each aoeii Sham ... T Im cantSJenM iiii tb r whiefc aueli 8 h an e have been allo tted k as fellowa:— N o t u :— L 2. S. i includes __ a t Allotm ents m ade an dU breat d ata* _ dw datee o_f oaty _ _______ W h o i & r___________ Uw l o ________ t a a d laat o____ fiu e h A U otaeati should b e m tm ti, aad «ha nffetrm tien o fd w M u m i& M ld be a flta e d 'w itU a on* m onth o f th e fast data* W hsa a re tsm relatsx to one A llotm ent only, m ade OD otie p aritcu lar d ate, th a t d ate only should b e fauertad a a d th e ipacos fer th e iccood date struck ou t and th e w ord “ saade” n ib stituted fix the w ord "fro m " after flu K ord Aflotnmm.** P a * . 2 need M t be ooenrpleted i> a c u e w h en S hane arc allo tted to th e m ember* o f a p»T an a f if iia lfaetim o r prneuW yny a llo ta d cn a rijh u issue. . ^ TrumUdfirflit? ky " tha&etaL'_ . 5.6655. 5.15 g?dava a ?g i?ff Egg? N?gmn. m? .. . .mvraex it.? brat wig? a} ?9 . ExtAppendix XV (19) Dr Patrick Finbarr Collins 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Dr Patrick Finbarr Collins. a) Transcript of evidence of Dr Barry Collins o f 22 March 2000. b) Letter of 9 December 1976 from Mr John Furze to Mr Frank Lee. c) Redhall Investments Ltd 1976 accounts & Redhall Trust documentation. d) Extract from transcript o f evidence of Cornelius Collins o f 11 April 2000 Q.l 14-168 inclusive. UNDER OATH ON WEDNESDAY, 22ND M A R C H 2000 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The Inspectors: MR. J U S T I C E C O S T E L L O M R . ROWAN FCA MS. M A C K E Y B L S o l i c i t o r to the I n s p ec t o r s MS. M. C U M M I N S Interviewee: DR. B A R R Y C O L L I N S WITNESS DR. B. C O L L I N S EXAMINATION MS. M A C K E Y PAGE 5 - 29 MR. R O W A N 30 - 37 MR. J U S T I C E C O S T E L L O 38 - 46 MS. M A C K E Y 47 - 50 1 2 3 4 MR. JUSTICE COSTELLO: 5 Dr. Collins, we will b e g i n our interview. M y n a m e is 6 D e c l a n C o s t e l l o a n d o n m y r i g h t is Ms. 7 m y l e f t is Mr. 8 know, 9 DR. COLLINS: Yes. 10 MR. JUSTICE COSTELLO: This i n t e r v i e w will be 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Rowan. M a c k e y a n d on We are Inspectors, as y o u a p p o i n t e d b y The H i g h Court. under oath and I would ask o u r s o l i c i t o r n o w to a d m i n i s t e r t h e o a t h t o you. 1 AS FOLLOWS 2 3 4 MR. JUSTICE COSTELLO: Doctor, 5 Ms. I will ask M a c k e y to start asking 6 you some questions. 7 DR. COLLINS: Yes . DR. COLLINS WAS EXAMINED, AS FOLLOWS, MS. MACKEY: G o o d m o r n i n g Dr. 8 9 B Y MS. M A C K E Y 10 11 1 Q. 12 A. 13 2 Q. Morning. C a n y o u just, for the record, 14 about yourself first? 15 that right? 16 A. 17 3 Q. 18 A. 19 4 Q. 20 A. 21 5 Q. 22 A. 23 6 Q. 24 A. Yes, 25 7 Q. Yes? 26 A. 27 8 Q. 28 29 Collins? Yes, tell me a little bit You are a me d i c a l doctor, is a medical practitioner. A general practitioner? General practitioner, yes. In C o r k ? Yes, just retired. Just retired? Yes. Okay. H a v e yo u l i v e d in C o r k all y o u r life? a l l m y li fe. A c t u a l l y I was b o r n in America. B u t I l i v e d in C o r k s i n c e 1932. Yes. H a v e yo u alwa y s p r a c t i c e d m e d i c i n e or h a v e you b e e n . . . (INTERJECTION)? 1 2 A. 3 10 Q. 4 Yes. Y o u r e c e i v e d o u r l e t t e r t h a t w e s e n t t o you, at t h e b e g i n n i n g o f F e b r u a r y ? 5 A. 6 11 Q. 7 A. 8 12 Q. 9 Yes. The end of February? Yes. Y o u w r o t e b a c k t o us a n d y o u t o l d us, our questions, tha t, in fact, 10 dealings with the company, 11 "Ansbacher"? 12 A. 13 13 Q. 14 i n a n s w e r to you never had any as w e c a l l it, T h a t is c o r r e c t . O r as it u s e d t o b e c a l l e d G u i n n e s s M a h o n C a y m a n Trust? 15 A. 16 14 Q. 17 Yes. Y o u d i d m e n t i o n t h a t y o u w e r e at o n e t i m e a non-executive Director? 18 A. 19 15 Q. 20 A. 21 16 Q. 22 A. Yes. Of W e s t b o r o Investments? Investments. What was that company? T h e y w e r e i n v o l v e d -- w el l , m y brother was what you 23 m i g h t c a l l t h e M a n a g i n g D i r e c t o r o f it. 24 b u s i n e s s p e r s o n in it. 25 17 Q. 26 A. 27 18 Q. 28 A. 29 I know, He was the Y o u r b r o t h e r n o w is? M y b r o t h e r is C.J. C.J. Collins. Collins? A n d he s t a r t e d w h a t w a s e f f e c t i v e l y a n i n v e s t m e n t company. 1 19 Q. 2 A. 3 20 Q. 4 A. 5 21 Q. 6 A. 7 Yes? So, he a s k e d m e t o i n v e s t i n it. Yes? For a l o n g - t e r m situation. Yes? T h e y i n v e s t e d in p r o p e r t i e s . supermarkets. 8 22 Q. 9 A. T h e y i n v e s t e d in I t h i n k t h e y i n v e s t e d i n a farm. Yes? S o m e w o o d l a n d s a n d t h i n g s l i k e t ha t . General investment. 10 11 23 Q. 12 A. 13 24 Q. 14 General property? Yes. Again, just n a m e Dr. 15 A. 16 25 Q. 17 A. 18 26 Q. 19 A. 20 27 Q. 21 A. 22 28 Q. Well, for the record, w h a t is y o u r o w n f u l l Collins? m y p r o p e r f u l l n am e . Yes? Is P a t r i c k F i n b a r . Patrick Finbar? Collins. Yes. However, y o u a r e g e n e r a l l y k n o w as B a r r y ? As B a r r y Collins, Yes. yes. Y o u s a y in r e l a t i o n t o W e s t b o r o I n v e s t m e n t s 23 t h a t y o u do k n o w t h a t t h e y h a d d e a l i n g s w i t h 24 Guinness 25 A. 26 2 9 Q. 27 A. 28 29 & Mahon Ireland Limited? Yes. Did t h e y have an a ccount w i t h Gu i n n e ss Well, al l I k n o w is, amongst others, or I w a s t o l d was, Guinness & Mahon? t h a t they, & Mahon Dublin... . 1 A. ... w e r e b a n k e r s . 2 Q. Yes ? 3 A. T h a t t h e y d e a l t w it h . 4 Q. That W e s t b o r o dealt with them? 5 A. D e a l t w i t h the m. 6 Q. Yes? 7 A. Yes . 8 Q. You were a non-executive 9 A. Yes . 10 Q. H o w i n v o l v e d w e r e y o u in t h e d a y - t o - d a y a f f a i r s it? 11 12 D i r ector in W e s t b o r o ? A. I wasn't. The onl y time I m i g h t be i n v o l v e d w o u l d 13 b e w h e n I w o u l d b e p r e s e n t e d w i t h a d o c u m e n t to 14 countersign because I was a Director and I was asked 15 t o p u t m y s i g n a t u r e t o it. 16 36 Q. 17 A. 18 37 Q. 19 A. Or b e n e f i t of a ny description. 20 38 Q. Did you attend b oard meetings? 21 A. 22 39 Q. 23 A. No, 24 40 Q. No. I see? I n e v e r got a ny remuneration. Remuneration, yes? No. Directors meetings? no. V e r y g o o d. Dr. Collins, y o u w e n t t h e n w e n t on 25 t o s a y t h a t y o u h a v e no k n o w l e d g e of A m i e n s 26 Securities ? 27 A. 28 41 Q. 29 No. Or K e n f o r d or a ny of these? 1 42 Q. T h a t is fi ne. C o u l d I then just ask you to have a 2 l o o k at a d o c u m e n t ? 3 (Same H a n d e d ) ? 4 A. 5 43 Q. 7 A. 8 44 Q. 9 A. 10 45 Q. 11 A. 12 46 Q. 13 T h a n k you. T h i s is a l e t t e r o f t h e 9t h D e c e m b e r 1976, you will Yes. A d d r e s s e d to a Mr. Frank Lee? He w a s t h e s e c r e t a r y of W e s t b o r o I n v e s t m e n t s . W a s he ? Yes. Right. T h a n k you. It is a d d r e s s e d t o h i m as y o u w i l l see f r o m the top t h e r e ? 14 A. 15 47 Q. 16 A. 17 48 Q. 18 A. 19 49 Q. Yes. Guinness Mahon Cayman Trust? Yes. W h i c h is n o w k n o w as " A n s b a c h e r " ? Yes, yes. T h e l e t t e r is s i g n e d b y a J o h n A. Furze. You see that on the second page? 20 21 A. 22 50 Q. 23 Yes, o k ay . Fine, yes. There s h o u ld be two pages, Mary. Have you got a second page? A. 25 No. MS. 26 A. 27 51 Q. 28 29 ( E x h i b i t 1) se e t h e r e ? 6 24 It is p a g e 24. CUMMINS: O k ay, MS. Sorry t h a n k you. MACKEY: Do y o u k n o w w h o Mr. is ? A. (Same H a n d e d ) . I know by r e a d i n g the newspapers. Furze 1 52 Q. 2 A. 3 53 Q. 4 A. 5 54 Q. 6 A. 7 55 Q. Yes? But I don't However, No, know.. . (INTERJECTION). did you know before? never. You never knew? No. You might like to just r e a d t h r o u g h t h a t l e t t e r there? 8 9 A. 10 56 Q. 11 A. 12 57 Q. 13 A l l ri g h t , Ok a y . For a few m o m e n t s Collins? Yes. I w o u l d d irect you p a r t i c u l a r l y to the s econd p a r a g r a p h o f it t h e r e . 14 A. 15 58 Q. 16 What does I.E.C. m e a n ? T h e y a r e s o m e k i n d of s h a r e s . c a n ' t t e l l us, 17 A. 18 59 Q. 20 it o u t t o y o u ? A. 22 60 Q. 23 A. 24 61 Q. 25 A. 26 62 Q. 27 A. 28 I w a n t y o u t o l o o k at. T h i s is I will just read " D i r e c t l y c r e d i t e d to t h e a c c o u n t o f . . . " " . . . o f Dr. Yes, Berrie Collins..." "...Berrie Collins..." W h i c h I p r e s u m e is y o u ? Well, Barry that should be obviously. "...at Marine M i d l a n d Bank..." "...at Marine M i d l a n d Bank..." A n d where w o u l d that be l o c a t e d ? 63 Q. You no? A n y w a y if yo u just r e a d the n e x t s entence. really what 21 I d o n ' t kno w. No. 19 29 Dr. I am asking you? 1 2 64 Q. 3 A. 4 65 Q. 5 A. 6 66 Q. 7 A. 8 67 Q. 9 A. I h a v e h e a r d o f M i d l a n d Ban k. Right. Di d yo u h a v e an a c c o u n t in M i d l a n d B a nk? No. You never did? No, not to m y knowledge. C a n y o u e x p l a i n in a n y w a y w h a t t h i s m e a n s ? No, I h o n e s t l y can't. I h ave no kno w l e d g e w h a t s o e v e r o f tha t. 10 11 H a v e y o u e v e r h e a r d of M a r i n e M i d l a n d B a n k ? 68 Q. J u s t le t us t r y a n d t e a s e t h i s o u t a l i t t l e b i t ? T h i s is 1 9 7 6 ? 12 13 A. 14 69 Q. 15 A. 16 70 Q. 17 A. 18 A l l right. 71 Q. 20 A. yes. W e r e y o u at t h i s s t a g e i n v o l v e d i n W e s t b o r o ? I p r o b a b l y was. When did you b e c o m e ...(I N T E R J E C T I O N ) ? W h e n I i n v e s t e d m o n e y it w a s t h e t i m e w h e n Mr. 19 Ok a y , Richie Ryan was M i n i s t e r For Finance. In the e a r l y 197 0 ' s ? A n d The W e a l t h Tax was introduced. What year would that be? 21 22 7 2 Q. 23 A. 24 A r o u n d 1974? Well, a n y w a y I w a s a d v i s e d -- I h a d A m e r i c a n securities. 25 73 Q. 26 A. 27 Yes? W h i c h h a d b e e n g i v e n to m e b y a r e l a t i v e w h o l i v e d a n d w o r k e d in A m e r i c a . 28 74 Q. 29 A. Right? A n d I h a d b e e n g i v e n t h o s e in 1 9 5 0 / 6 0 s . 1 75 Q. 2 A. 3 76 Q. 4 A. 5 A n d I w a s a d v i s e d to s e l l t h o s e s h a r e s . Yes? A n d t o i n v e s t t h e m o n e y w h a t e v e r w a y I w a n t e d to i n v e s t it. 6 77 Q. 7 A. Yes? A n d t h i s is h o w I c a m e t o i n v e s t m o n e y i n Westboro Investments. 8 9 78 Q. 10 A. 11 7 9 Q. 12 A. 13 80 Q. 14 A. 15 81 Q. 16 A. 17 82 Q. 18 A. 19 83 Q. 20 A. 21 84 Q. 22 A. 23 85 Q. 24 A. 25 86 Q. 26 W e r e y o u a s h a r e h o l d e r in W e s t b o r o , Well, I suppose I was b e c a u s e Dr. Collins? I i n v e s t e d money. D i d yo u p u r c h a s e shar e s in the c o m p a n y ? I didn't have any share certificates. You ha d no share certi f i c a t e s ? No, no. S o . . . (INTERJECTION)? I just gave my brother the money. Yes? A n d h e i n v e s t e d it f o r me. Yes? In W e s t b o r o Investments. In W e s t b o r o ? Yes. A n y w a y j u s t g e t t i n g b a c k to t h i s l e t t e r ? Yes. T h e l e t t e r is, as I said, f r o m Mr. F u r z e t o Mr. Lee, w h o y o u s a i d is t h e s e c r e t a r y o f W e s t b o r o ? 27 A. 28 87 Q. 29 Yes? T h a t is r i g h t . It is s e n d i n g h i m t h e a c c o u n t s o f a c o m p a n y c a l l e d 1 2 88 Q. 3 A. 4 89 Q. 5 A. Are you familiar with Redhall? I a m not, no. Y o u h a v e n e v e r h e a r d of R e d h a l l No. Now, don't get me wrong, Investments? I m a y have h e a r d the 6 w o r d R e d h a l l b u t w h a t it is a l l a b o u t I h a v e n o 7 idea. 8 90 Q. 9 A. 10 91 Q. 11 A. 12 92 Q. 13 A. 14 93 Q. 16 A. 17 I m i g h t h a v e h e a r d it f r o m m y b r o t h e r . From your brother? S o m e w h e r e a l o n g t h e way. From you bro t h e r a n d . ..(I N T E R J E C T I O N ) ? Well, I d o n ' t w a n t to c o m m i t h i m t o s o m e t h i n g t h a t Yes? That I have ever re a l l y h e a r d of s o mewhere along the way. 18 94 Q. 19 A. 20 95 Q. Yes? B u t ... ( I N T E R J E C T I O N ) . W o u l d y o u h a v e h e a r d of it i n c o n n e c t i o n w i t h Westboro? 21 A. 23 24 Well, m i g h t n ' t b e a b s o l u t e l y t r u e b u t it is n o t a n a m e . 15 22 W h e r e m i g h t y o u h a v e h e a r d i t? Well, t h a t is t h e o n l y w a y o r p l a c e , I could have h e a r d o f it. 96 Q. Right. J u s t m o v i n g a l o n g then , t h i s l e t t e r is 25 s e n d i n g t h e a c c o u n t s of R e d h a l l I n v e s t m e n t s to 26 Mr. 27 He p o i n t s o u t t h a t 28 Mr. 29 r e d u c t i o n in t h e l o a n c a p i t a l d u e t o w r i t i n g o f f t h e Lee for his approval, an u p d a t e d B a l a n c e Sheet. from the upd a t e d Balance Sheet Lee will see that t here has b e e n a slight I.E.C. 1 s h a r e s at c o s t a n d h e says: "You will recall that these shares were sold and the sale proceeds credited d i r e c t l y to t h e a c c o u n t of Dr. B e r r i e C o l l i n s at M a r i n e Midland Bank." 2 3 4 5 6 Y o u s a y Dr. 7 a c c o u n t i n M i d l a n d Bank, 8 A. 9 is t h a t r i g h t ? I h a v e n o k n o w l e d g e of t h i s . Well, w h e r e is t h i s ba n k located. 10 97 Q. 11 A. 12 98 Q. 13 A. 14 99 Q. 15 Sorry, if y o u w o u l d j u s t l e t m e a s k t h e q u e s t i o n s ? A l l right. A. 17 100 Q. 18 A. 19 101 Q. 20 A. 21 102 Q. 22 A. 23 Ok a y . If y o u w o u l d n o t m i n d ? Right. C a n y o u t e l l us w h e r e y o u h a v e h a d b a n k a c c o u n t s in t h e pa s t , 16 Well, what banks? A I B is m y m a i n b an k . Right? I h a d a s m a l l a c c o u n t in A I B B r u t o n S t r e e t . Yes? I had a daughter living i n . . . (INTERJECTION). However, leaving aside AIB now? A n d I h a d m o n e y t h a t w e n t i n t o a b a n k a c c o u n t in N e w Y o r k f r o m s h ares that w e r e there. 24 103 Q. 25 A. 26 104 Q. 27 A. 28 105 Q. 29 C o l l i n s that yo u h a v e n e v e r h a d an W h a t was the n ame of that Bank? AI B. In N e w Y ork? Yes. Right. A n y other bank except AIB that you recollect ? 1 2 1 0 6 Q. 3 A. 4 th e n . . . (INTERJECTION)? Y o u se e I l e f t a l o t of -- I l e f t a l l of t h i s kind of b u s i n e s s d e a l i n g a n d w h a t e v e r t o m y b r o t h e r . 5 107 Q. 6 A. 7 108 Q. 8 A. 9 1 0 9 Q. 10 A. 11 110 Q. H o w e v e r ... ( I N T E R J E C T I O N ) ? I ... ( I N T E R J E C T I O N ) . You must k n o w if y o u h a d b a n k a c c o u n t s Dr. 13 A. 14 111 Q. 15 A. 16 112 Q. 17 Collins? W e l l ... ( I N T E R J E C T I O N ) . Or you w o u l d get s t a te m e n t s ? Well, h e w o u l d h a v e go t t h e s t a t e m e n t s p r o b a b l y . However, i f t h e r e w a s a n a c c o u n t i n y o u r n a m e in a b a n k the s t a t e m e n t s 12 18 Well, should...(INTERJECTION)? I s h o u l d get the statements, Yes. Yes, you should. shouldn't I? Can you recollect? I c a n ' t r e m e m b e r it r e a l l y . You cannot remember ever having a bank account other than A l lied Irish Banks? A. Well, if y o u a r e p r e s s i n g m e o n it o b v i o u s l y , 19 a c c o r d i n g to this , 20 m y m o n e y h a d b e e n a n d m a y b e it w e n t f r o m 21 M a r i n e M i d l a n d i n t o A I B t he n . 22 113 Q. 23 A. 24 114 Q. Right. there was a Marine Midl a n d where If t h a t h a p p e n e d ? Yes. Supposing that happened, that m o n e y went from Marine 25 Midland, 26 r e c o l l e c t p r o c e e d s of t h e s a l e o f s h a r e s c o m i n g i n t o 27 y o u r a c c o u n t in A I B ? 28 29 A. Now, w h e r e e v e r t h a t is, w i t h m y shares, what i n t o AIB, I did was c e r t i f i c a t e s to m y broth e r . can you I gave my share 1 115 Q. 2 A. 3 1 1 6 Q. 4 A. 5 117 Q. 6 A. 7 Right? A n d he d i s p o s e d o f them. Yes? A n d he i n v e s t e d t h e m o n i e s . What were these share certificates? T h e y w e r e A m e r i c a b l u e ch i p s , gi v e n , 8 118 Q. 9 A. 10 1 1 9 Q. Right? 11 A. In t h e 12 120 Q. 13 A. 14 121 Q. 15 A. 16 122 Q. 17 A. 18 123 Q. 19 A. as I t o l d you. Yes? By an uncle of mine. 1 9 5 0 s a n d 19 60 s. Yes? T h e y w e r e t h i n g s l i k e Ex o n . Yes? S t a n d a r d Oil. Yes? N e w J e r s e y S t a n d a r d Oil of California. Yes. A n d I h a d s h a r e s in W a t e r f o r d Glass, Irish Glass Bottle. 20 21 124 Q. Yes. 22 A. Yes, 23 125 Q. Yes. 24 A. 25 Yo u g a v e t h e s e to y o u r b r o t h e r ? a n d h e s o l d t h e m on. C o u l d t h a t b e w h a t is r e f e r r e d t o h e r e ? It c o u l d w e l l be, yes, yes, because I d i d n 't sell a n y of t h e s e m y s e l f . 26 1 2 6 Q. 27 A. 28 29 which I had been Yes? B u t I d i s p o s e d o f t h em . A c t u a l l y I gave authority t o d i s p o s e o f t h em. 127 Q. Yes. It a p p e a r s from this letter that the shares 1 t h a t a r e b e i n g r e f e r r e d to h e r e a r e s h a r e s t h a t w e r e 2 a s s e t s of R e d h a l l 3 is b e i n g e x p l a i n e d in t h i s l e t t e r t h a t t h e r e h a s 4 b e e n a s l i g h t r e d u c t i o n in t h e l o a n c a p i t a l 5 A. 6 128 Q. 7 A. 8 1 2 9 Q. 9 A. 11 130 Q. Due to the sale of these shares? Yes. T h e s e s h a r e s w e r e s h a r e s t h a t w e r e a s s e t s of t h i s Right, Investments? yes. Y o u c a n n o t r e m e m b e r w h e t h e r y o u e v e r h e a r d of 12 Redhall 13 s a y . . . (INTERJECTION)? 14 A. Well, Investments, you m a y you n o w as I s a i d t o y o u t h e n a m e i s n ' t t o t a l l y u n f a m i l i a r t o me. 15 16 131 Q. 17 A. 18 132 Q. 19 A. Yes? But beyo n d the name itself I can't elaborate. Right. I see? And I don't know what this "I.E.C." shares business is . 20 21 figure? Yes. company Redhall 10 Investments Limited because what 133 Q. It a p p e a r s from our information here that 22 Redhall 23 The R e d h a l l Trust, 24 Redhall 25 G u i n n e s s M a h o n C a y m a n Trust, 26 A. 27 134 Q. I n v e s t me n t s was a c o m p a n y w h o l l y o w n e d by w h i c h was a C a y m a n I s l a n d Trust. Investments had a deposit with w h i c h is "Ansbacher"? Yes. The assets of this co m p a n y i n c l u d e d t hese shares 28 t h a t w e r e s o l d a n d t h e p r o c e e d s of w h i c h w e r e 29 transferred, a c c o r d i n g to t h i s l e t t e r , i n t o an 1 2 Well, 3 f o r e i g n t o me. 4 135 Q 5 A n o w y o u a r e t e l l i n g m e s o m e t h i n g t h a t is v e r y You c a n n o t . . . (INTERJECTION)? I h a d as k e d , b e f o r e I e v e r c a m e h e r e t o d a y tha t, 6 know, 7 c o u l d have b e e n i n v o l v e d wit h others in a 8 Cayman Trust," 9 136 Q 10 A 11 137 Q 12 A 13 138 Q 14 A 15 139 Q 16 A 17 18 140 Q "No w a y " . Who did you ask? My brother. M r . . . (INTERJECTION)? C.J. Mr. Collins. C.J. Collins? Yes . A n d he t o l d you, He said, "No, "No"? f o r g e t it. There was nothing you were Right. C a n I a s k y o u if y o u h a v e e v e r h e a r d of Tamarin Holdings? 20 A 21 141 Q 22 A 23 142 Q 24 A 25 143 Q 26 A 27 144 Q 29 a n d I w a s tol d, I i n v o l v e d i n t h a t r e l a t e d to C a y m a n T r u s t " . 19 28 "W as t h e r e a n y o u t s i d e p o s s i b i l i t y t h a t you No. You never have? No, is t h a t s o m e t h i n g e l s e ? T h i s is j u s t a c o m p a n y I a m a s k i n g y o u ? Yes . If y o u h a v e e v e r h e a r d o f ? No. H a v e yo u e v e r h e a r d of a c o m p a n y c a l l e d Neptune Investments? 1 145 Q 2 A 3 146 Q 4 A 5 147 Q 7 A 8 148 Q 9 A 10 149 Q Maybe. I don't know. Once again the name Right. W h e r e do yo u t h i n k . .. ( I N T E R J E C T I O N ) ? I couldn't give you an an s w e r b e c a u s e I see. I don't know. Delta Investments? No. W e r e yo u e v e r i n v o l v e d in a c o m p a n y c a l l e d Charlemont Estates? 11 12 A 13 150 Q 14 A 15 151 Q 16 A 17 Yes . You were? Yes . C o u l d y o u t e l l us a l i t t l e b i t a b o u t t h a t ? A s f a r as I k n o w t h e y d e v e l o p e d a b u i l d i n g a l o n g t h e canal. 152 Q 19 20 Agar International? A g a r . . . (INTERJECTION). 6 18 No. A s f a r as y o u know, involvement A Well, w e r e y o u -- w h a t w a s y o u r in t h i s c o m p a n y ? as w i t h W e s t b o r o I n v e s t m e n t s -- a 21 n o n - e x e c u t i v e D i r e ct o r of W e s t b o r o I n v es t m e n t s who 22 was told about Charlemont Estates but I 23 don't...(INTERJECTION). 24 153 Q 25 A 26 154 Q 27 A 28 29 What was Charlemont Estates? I t h i n k it w a s a g r o u p w h o d e v e l o p e d or b u i l t . Right? A n d one of the b u i l d i n g s th e y put up b y all ac c o u n t s was d o w n on the canal here. 155 Q Yes? 1 2 156 Q 3 A 4 Well, m y bro t h e r was the p e rson who was effectively t h e b u s i n e s s p e r s o n i n this. 5 157 Q 6 A 7 158 Q Wha t do you m e a n b y "business p e r son"? I h a d n o say. Wha t do you m e a n b y "business pers o n " Dr. Collins? Was h e . . . (INTERJECTION)? 8 9 Whose company was this? A I wasn't a business person. I had n o . . . (INTERJECTION). 10 11 159 Q 12 A 13 160 Q 14 A Was your b r o t h e r a D i r e c to r of C h a r l e m o n t Es t a t es ? Gosh , I a m s u r e h e was, yes. A n d were you? Well, h e m i g h t h a v e h a d m e d o w n as a D i r e c t o r b u t never attended a n y . . . (INTERJECTION). 15 16 161 Q 17 A 18 162 Q 19 A However, were you a D i r e c t o r of C h a r l e m o n t Estates? I c o u l d be. I am not sure really. You are not sure? I a m b e i n g p e r f e c t l y h o n e s t no w. I am after 20 s w e a r i n g on oath and I am not sure but I p r o b a b l y 21 W8. S . 22 163 Q 23 A 24 164 Q 25 A 26 165 Q 27 28 29 I You were p r o b a b l y a D i r ector of C h a r l e m o n t Estates? I p r o b a b l y was, yes. T h i s w a s a c o m p a n y i n v o l v e d in p r o p e r t y d e v e l o p m e n t ? Yes, yes. In w h a t w a y w a s t h i s c o m p a n y c o n n e c t e d with Westboro? A Well, I w o u l d h a v e t h o u g h t it w a s p a r t o f W e s t b o r o Investments. 1 1 6 6 Q. 2 A. 3 167 Q. 4 A. 5 168 Q. A. 1 6 9 Q. yes. You t h o u g h t . . . (INTERJECTION)? T h a t it w a s o n e o f t h e i r i n v e s t m e n t s . I see. W o u l d it h a v e b e e n a w h o l l y o w n e d s u b s i d i a r y D o y o u m e a n j u s t C.J. C o l l i n s a n d m y s e l f or w o u l d No, is t h a t it? d i d W e s t b o r o -- w a s W e s t b o r o t h e o n l y shareholder? 10 11 A. 12 170 Q. 13 A. 14 171 Q. 15 A. 16 172 Q. 17 A. 18 173 Q. 19 A. 20 174 Q. 21 A. 22 175 Q. 23 A. Gos h, I d o n ' t t h i n k so, No, no, no. You think there were other people involved? Yes, definitely. Who might the other people be? D o I h a v e to n a m e n a m e s ? W e l l ... ( I N T E R J E C T I O N ) ? D o I? Yes? Well, I think Patrick and the McGraths. W h o are they? 25 his brother. 1 7 6 Q. 27 A. 28 177 Q. Patrick and? P a d d y a n d w h a t w a s t h e -- I c a n ' t r e m e m b e r . brother. 26 no. Y o u d o n o t t h i n k so? 24 29 so, t here be o t h e r p e o p l e involved, 8 9 I would have thought of W e s t b o r o ? 6 7 Y o u m e a n it w a s a s u b s i d i a r y o f W e s t b o r o ? His b r o t h e r anyway. Patrick McGrath and Patr i c k M c G r a t h and his b r o t h e r ? Yes. A n d you and your brother? A 1 2 A. 3 17 9 Q. 4 A. 5 180 Q. I really don't 7 A. 8 181 Q. 9 A. 10 182 Q. Y ou do not know? No. Were you and your brother the only shareholders in I t h i n k so, yes. You were? Yes. Y o u r b r o t h e r w a s t h e M a n a g i n g D i r e c t o r of Westboro Investments? 11 12 A. 13 183 Q. 14 A. 15 184 Q. 16 Yes, yes. A n d you were the only other Director? To m y knowledge, yes. You would have intimate k n o w l e d g e t h e n of what We s t b o r o Investments was doing? A. No, I w o u l d n ' t as a m a t t e r o f fact. 18 ab r ea s t of things. 19 l e t it at t h at . 20 practice. 21 185 Q. 22 A. 23 18 6 Q. 24 I see. I wasn't kept I i n v e s t e d m y m o n e y a nd I just I c o n c e n t r a t e d on m y own medi c a l Similarly, with Charlemont Estates? Yes. What other companies did Westboro Investments have an i n v o l v e m e n t w ith? 25 A. 26 187 Q. 27 A. 28 188 Q. 29 know. Westboro Investments? 6 17 I d o n ' t know. T h e y h a d an i n v o l v e m en t w it h W e s t b o r o Finance. Westboro Finance? Yes. Can you tell be what involvement there was there? Was your b r o t h e r a D i r e c to r of W e s t b o r o F inance ? 1 2 189 Q 3 A 4 190 Q 5 A 6 191 Q 7 A I h a v e n ' t a n y d o c u m e n t a t i o n to p r o v e t h a t I was. D o y o u k n o w w h e t h e r y o u w e r e o r not, Collins? Pardon? Do you know w h e t h e r you w e r e or not? Once again I probably would have been a n o n-executive Director. 8 9 192 Q 10 A 11 193 Q 12 A 13 194 Q 14 A 15 195 Q 16 A 17 You probably were? Yes . Were there any other companies? O f f h a n d I c a n ' t t e l l you. You cannot tell me? No. Right. Well, W e s t b o r o Finance, what exactly was that? t h e y w e r e i n v o l v e d in a b a n k i n g s i t u a t i o n w i t h a g r o u p c a l l e d F i r s t S o u t h e r n Bank . 18 196 Q 19 A 20 197 Q 21 A Yes. W h e n you say "in a b a n k i n g s i t u a t i o n " ? Well, t h e y w e r e a bank. We s t b o r o Finance was a bank? W e l l -- now, I a m g o i n g to get c o n f u s e d h e r e b e c a u s e I am not sure of what I am saying. 22 23 198 Q 24 A 25 Yes. As b e s t you can? W e s t b o r o F i n a n c e m a y b e -- t h e y d e v e l o p e d First S o u t h e r n B a n k I think. 26 199 Q Yes? 27 A Now, I c o u l d be p r o v e d w r o n g on this d e v e l o p i n g it b u t . . . ( I N T E R J E C T I O N ) . 28 29 Dr. 20 0 Q statement about 1 2 20 1 Q 3 A 4 202 Q 5 A F i r s t S o u t h e r n Bank . 6 20 3 Q First Southern Bank? 7 A 8 204 Q 9 Tell me if yo u are not sure? Yes, I am not sure, yes. They d e v e l o p e d Southern Finance, w a s it? Yes . Dr. Collins, were you ever involved with your b r o t h e r in t h e s e t t i n g u p o f a n y t r u s t s o f f s h o r e ? 10 A 11 20 5 Q 12 A 13 206 Q 14 A 15 207 Q 16 A 17 208 Q 18 A 19 209 Q 20 A 21 21 0 Q No, definitely.. . (INTERJECTION). N o n e at a l l ? D e f i n i t e l y not. E i t h e r in C a y m a n o r in t h e C h a n n e l No, Islands? not to m y knowledge. Not to your k n owledge? No. D o e s t h e t e r m " R e d h a l l T r u s t " m e a n a n y t h i n g to y o u ? A s I s a i d to y o u a l r e a d y t h e n a m e R e d h a l l . Yes? I t ' s in m y m i n d b u t it d o e s n ' t r e g i s t e r o t h e r w i s e . D o y o u k n o w if y o u w e r e t h e b e n e f i c i a r y o f a n y t r u s t se t u p b y y o u r b o t h e r o f f s h o r e ? 22 23 A 24 21 1 Q 25 A 26 212 Q 27 No, d e f i n i t e l y not. You were not? No. Can I pass you another document, at p a g e 26 M a r y , 28 A 29 21 3 Q j u s t p a g e 26 Dr. Collins. It is (Same h a n d e d ) ? T h a n k you. Again, a l e t t e r o f 1976. 24 T h i s t i m e it is s e n t f r o m 1 Limited? 2 3 A. 4 214 Q. 5 Right, yes. It s t a r t s off: " D e a r Rue, Re: C.J. Collins Account." Collins/P.F. 6 7 A. 8 215 Q. 9 A. 10 21 6 Q. 11 A. 12 217 Q. 13 Right, Okay. Y o u h a v e t o l d us t h a t y o u r n a m e is P a t r i c k F i n b a r ? T h a t is ri g h t , yes, t h a t is r i g h t . So t h i s is y o u ? Yes, certainly, yes. Now: "Confirming yesterdays telephone c o n v e r s a t i o n w i t h H e l e n Kelly, I w o u l d be o b l i g e d if yo u c o u l d o p e n a n e w A c c o u n t in the a b o v e n a m e a n d let me h a v e a c h e q u e p a y a b l e to S o u t h e r n I n n s Ltd, f o r £ 1 5 , 0 0 0 . On the p r e s e n t m a t u r i t y of the P o n d e r o s a deposits you could instruct John Furze to let yo u h a v e an a m o u n t f r o m the i n t e r e s t f i g u r e e a r n e d to c l e a r t h i s £1 5 , 0 0 0 w i t h i nterest a c c r u e d to the clearing date." 14 15 16 17 18 19 20 A. 21 218 Q. Yes. T h i s is a n a c c o u n t w h i c h h a d b e e n o p e n e d in Guinness 22 23 A. 24 2 1 9 Q. 25 A. 26 22 0 Q. & Mahon? It l o o k s l i k e it. Yes. Right, In t h e j o i n t n a m e s o f y o u a n d y o u r b r o t h e r ? yes. You t o l d me a w hile ago that you c o u l d not r e m ember 27 h a v i n g an y b a n k a c c o u n t s o t h e r t h a n in 28 Allied Irish Banks? 29 1 22 1 Q. 3 A. 4 222 Q. 5 A. 6 22 3 Q. 7 A. 8 224 Q. 9 A. 22 5 Q. Do Yes, certainly, yes. Y o u do? B u t I d i d n ' t h a v e a n y k n o w l e d g e o f th a t . You ha d no knowledge? No. Before you saw this? No, no. First Southern, yes, but the ban k account, C a n yo u e x p l a i n the r e f e r e n c e to the c h e q u e p a y a b l e to S o u t h e r n I n n s t h e r e ? 12 A. 14 I can't. All I k n o w is t h a t S o u t h e r n I n n s w a s a hotel. 15 2 2 6 Q. 16 A. 17 227 Q. 18 A. 19 228 Q. 20 A. 21 2 2 9 Q. 22 A. 23 23 0 Q. 24 Yes? In Blarney. Yes? That there was an i nvestment A. 26 23 1 Q. in. Yes? B u t t h a t is it as f a r as I a m c o n c e r n e d . T h a t W e s t b o r o i n v e s t e d i n? Yes. C a n yo u e x p l a i n w h a t the r e f e r e n c e to the c h e q u e for £15,000 25 No, for S o u t h e r n Inns w o u l d be? I ca n ' t . Do y o u t h i n k y o u r b r o t h e r w o u l d h a v e se t u p a n 27 a c c o u n t i n y o u r na m e , 28 t e l l i n g you? 29 & Mahon. no. 10 13 h e r e is a n a c c o u n t in G u i n n e s s you recollect this? 2 11 However, j o i n t l y w i t h him, without 1 232 Q. D i d y o u e v e r r e c e i v e d a n y b a n k s t a t e m e n t s in r e l a t i o n to a n a c c o u n t i n G u i n n e s s 2 3 A. 4 23 3 Q. 5 A. 6 234 Q. 7 A. No. 8 23 5 Q. Dr. 9 No, & Mahon? never. H a v e yo u e v e r h e a r d of P o n d e r o s a ? No. Y o u h a v e n e v e r h e a r d of t h at? Collins, i f I c o u l d j u s t s o r t of r u n o v e r b r i e f l y what y o u r e v i d e n c e h e r e t o d a y is? We have 10 shown you a document which states that proceeds 11 t h e s a l e of s h a r e s h e l d b y a c o m p a n y R e d h a l l 12 Investments, 13 c r e d i t e d to a n a c c o u n t i n y o u r n a m e ? 14 A. 15 2 3 6 Q. 16 A. 17 237 Q. w h i c h h a d d e p osits in "Ansbacher", from were Yes. Marine Midland Bank? Yes. Y o u r e v i d e n c e o n o a t h is t h a t y o u h a v e n o k n o w l e d g e 18 of e v e r h a v i n g a n a c c o u n t in M a r i n e M i d l a n d Bank, 19 a n d t h a t yo u k n o w n o t h i n g a b o u t a n y p r o c e e d s of 20 t h e s e shar e s b e i n g l o d g e d to an a c c o u n t in your 21 n a me , 22 A. 23 238 Q. 24 A. is t h a t c o r r e c t ? Can I q u alify this now? Yes please? M y k n o w l e d g e of a n y m o n i e s into an account, b e it 25 whatever, 26 c o n c e r n e d a n d t h a t w a s f r o m t h e s a l e o f m y US 27 securities. 28 29 2 3 9 Q. c a m e f r o m o n e s o u r c e o n l y as f a r as I a m T h e y w e r e l o d g e d to w h a t a c c o u n t ? 1 2 24 0 Q 3 A 4 24 1 Q 5 A 6 242 Q 7 A 8 24 3 Q 9 A 10 244 Q 11 A 12 24 5 Q 13 A Yes ? A n d he l o d g e d them . Yes, he s o l d t h e m ? A n d I l e f t it t o him. However, He did, h e s o l d them , did he? yes. Yes? Yes . However, t h e p r o c e e d s o f t h e s a l e of t h o s e ? Yes . Came to you c learly? No, I never a c tually saw them but o b v i ously they 14 w e r e p u t i n t o a n a c c o u n t in m y n a m e a n d t h e n 15 p r o b a b l y t r a n s f e r r e d i n t o W e s t b o r o I n v e s t m e n t s as a n 16 investment. 17 246 Q 18 Right. Now, I a m s u p p o s i n g t hi s . Do y o u t h i n g t h a t is w h a t is r e f e r r e d t o in this letter? 19 A 20 247 Q 21 A 22 248 Q 23 A 24 249 Q It l o o k s l i k e it t o m e now. Y o u t h i n k t h a t t h a t i s? Yes . W h a t is r e f e r r e d t o t h e r e ? Yes . T h e n i n r e l a t i o n to a n a c c o u n t t h a t a p p e a r s to h a v e 25 b e e n o p e n e d in G u i n n e s s 26 of y o u a n d y o u r b r o t h e r ? 27 A 28 25 0 Q 29 & M a h o n in the joint names Yes . Y o u r e v i d e n c e o n o a t h to u s t h e r e is t h a t y o u k n o w n o t h i n g of that a c count? 1 2 25 1 Q. 3 a n a c c o u n t in G u i n n e s s 4 A. 5 252 Q. 6 A. 7 8 25 3 Q. No. Is t h a t r i g h t ? I h a v e n e v e r e v e r h a d a n y d o c u m e n t of a n y However, & Mahon. d id you ever h e a r that you h a d an account there? A. Well, I knew that Westboro dealings with Guinness 11 12 254 Q. 13 A. 14 25 5 Q. 15 A. 16 2 5 6 Q. 17 18 You never knew you had & Mahon? description from Guinness 9 10 T h a t y o u n e v e r h e a r d o f it ? However, & Mahon. that you p e r s o n a l l y h a d an a c count? I h a d n o p e r s o n a l a c c o u n t w i t h him. Y o u n e v e r h a d t h a t. No. Yes. Dr. A. Investments had bank I have no further questions. T hank you Collins. Yes. 19 20 21 22 23 24 25 26 27 28 29 E N D O F E X A M I N A T I O N O F DR. C O L L I N S B Y MS. MACKEY 1 2 3 MR. ROWAN: Dr. 4 Collins, just going b a c k to W e s t b o r o , you said 5 that you a nd y our b r o t h e r w ere i n v o l v e d in W e s t b o r o 6 Investments ? 7 A 8 258 Q 9 Correct. H o w w a s t h e s h a r e h o l d i n g in W e s t b o r o d i v i d e d b e t w e e n yourself and your brother? W h a t n u m b e r of s h a r e s 10 d i d y o u h av e , o r w h a t p r o p o r t i o n of t h e s h a r e h o l d i n g 11 d i d y o u h av e , a n d w h a t p r o p o r t i o n d i d he h a v e ? 12 A I d o n ' t know. I was a s k e d to m a k e an i n v e s t m e n t . 13 m a d e it b u t w h e t h e r he m a d e a b i g g e r i n v e s t m e n t 14 c a n ' t t e l l y o u b u t t h e r e w e r e o n l y t w o o f us. 15 259 Q 16 A 17 26 0 Q 18 A 19 26 1 Q 20 A 22 Might you have s h a r e d . ..(I N T E R J E C T I O N ) ? I d i d n ' t g e t a s h a r e c e r t i f i c a t e as such. M i g h t y o u h a v e s h a r e d in it 5 0 / 5 0 ? I m i g h t hav e , yes, if it h a d g o n e a c c o r d i n g to p l a n . What was the plan? I was h o p i n g for a l o n g - t e r m i nv e s t m e n t that w o u l d 262 Q Y o u d o n o t k n o w w h a t p r o p o r t i o n of t h e v a l u e o f 23 W e s t b o r o is d o w n t o y o u a n d w h a t is d o w n t o y o u r 24 brother? 25 I b ring me profits. 21 A I s u p p o s e l o g i c a l l y I w o u l d s a y t h a t if t h e r e w e r e 26 o n l y tw o of us there, 27 investments, 28 26 3 Q 29 A I a n d if w e m a d e e q u a l I s h o u l d b e 50%. You never asked him this? 1 264 Q 2 A 3 26 5 Q 4 A 5 2 66 Q It h a s n o t p a i d o u t a n y m o n e y ? 6 A I l o s t e v e r y t h i n g I h a d i n it. 7 No, no. Over the years has W e s t b o r o p a i d out a d i v idend? I n ever got one ha'penny. My total investment went. 8 267 Q 9 A W h y was that? B e c a u s e at t h e e n d o f t h e d a y w i t h a l l t h e i r 10 i n v e s t m e n t s t h e y e v e n t u a l l y got i n v o l v e d in A t l a n t i c 11 Resources 12 s o u r c e s w e r e b e i n g c a l l e d in a n d t h a t was the e n d of 13 it. 14 268 Q 15 A 16 269 Q 17 However, and suddenly their borrowings stop a moment? Yes . W h i l e y o u h a v e t o l d us t h a t y o u d o n o t k n o w w h a t proportion? 18 A 19 27 0 Q 20 A 21 27 1 Q 22 A 23 272 Q 24 A 25 27 3 Q 26 A Yes . Of the shar e s in W e s t b o r o w e r e h e l d b y y o u r b r o t h e r ? Yes . E v e n if h e h a d h a d t o t u r n t h o s e s h a r e s i n t o c a s h ? Yes . Beca u s e he h a d l i a b i lities e l sewhere? Right, yes. Sure l y your interests w o u l d have bee n safe guarded? Well, they obviously weren't. 27 u n d e r o a t h is t h a t 28 Westboro Investments. 29 f r o m all 274 Q All I can tell you I n e v e r got a n y t h i n g out of 1 A 2 27 5 Q 3 A I p u t m o n e y in a n d g o t n o t h i n g o u t . Y o u p u t y o u r US s e c u r i t i e s Well, n o t a l l of m y US s e c u r i t i e s . 4 myself because 5 that. 6 276 Q 7 in? A ll right. I k e p t m o n e y fo r I bought a house and things like However, the bit that you put i n . . . (INTERJECTION)? 8 A 9 277 Q T h e bit, that went. Your b r o t h e r took those from you and put th e m into Westboro? 10 11 A 12 278 Q 13 Yes . A n d at s o m e s t a g e a l o n g t h e l i n e W e s t b o r o h a d to p r e s u m a b l y b e w o u n d up, 14 A 15 279 Q 16 . . . (INTERJECTION)? Yes . A t l e a s t t h e v a l u e of it s a s s e t s h a d t o b e t u r n e d into cash? 17 A T h a t is r i g h t , 18 28 0 Q Is t h a t r i g h t ? 19 A 20 28 1 Q 21 A I e x p e c t so, yes. yes. W h e n did that happen? I d o n ' t kn ow. I h a v e to a s k y o u q u e s t i o n s now. W h e n d i d A t l a n t i c R e s o u r c e s go b a n g ? 22 23 282 Q 24 A 25 28 3 Q Possibly during the 1980s? So, t h a t is w h e n t h a t h a p p e n e d so. D i d y o u r b r o t h e r come a l o n g to yo u one d a y an d say 26 t o y o u s o m e t h i n g to t h e e f f e c t , 27 financial 28 w e h a v e b u i l t u p in W e s t b o r o to h e l p s o r t o u t m y 29 l i a b i l i t i e s "? "I a m i n d i r e straits a nd I am g o i n g to have to use what 1 A 2 284 Q 3 A He j u s t said, " Look, things have gone all wrong". D i d y o u a s k h i m a b o u t i t? Well, I w a s u p s e t a b o u t it b e c a u s e I d i d n ' t w a n t to 4 lose what 5 w r o n g a n d h e t o l d m e t h a t t h e I n s t i t u t i o n s t h a t he 6 had borrowings 7 m o n e y b e c a u s e of the A t l a n t i c R e s ources 8 a n d he was 9 28 5 Q 10 A However, I h a d p u t in. I asked him what had gone f r o m o b v i o u s l y w e r e c a l l i n g in t h e i r situation f o r c e d to d i s p o s e o f w h a t e v e r . d i d y o u n o t say, I d i d a n d he said, "Well, "What about m y share"? what can I do?" I know 11 y o u a r e n o t g o i n g to b e l i e v e t h i s b u t it h a s t o b e 12 b e l i e v e d b e c a u s e it is t h e a b s o l u t e l y t r u t h . 13 this 14 n o t h i n g at t h e e n d o f a l l o f this. 15 286 Q 16 A 17 287 Q 18 A 19 288 Q 21 f r o m m y w i f e all the time but I a c t u a l l y got However, A We s tb o r o . .. (INTERJECTION)? I l e f t e v e r y t h i n g t o him. Was a separate Limited liability company? Right. H o w c o u l d it p o s s i b l y h a v e b e e n t i e d i n t o y o u r brother's 20 G o sh , liabilities? I don't know. I have n ' t an idea about 22 b u s i n e s s of any description. 23 you. 24 thought, 25 289 Q I hear All I just couldn't tell I c a n t e l l y o u is I i n v e s t e d , what I h e a v i l y a n d got nothing. I acknowledge that your p r o f essional expertise and 26 so o n m a y w e l l h a v e n o t c a u s e d y o u t o w a n t to b e 27 i n v o l v e d on a d a y - t o - d a y . . . ( I N T E R J E C T I O N ) ? 28 A 29 29 0 Q I never w a s . Interest? 1 2 29 1 Q 3 A 4 292 Q 5 A 6 29 3 Q 7 8 A Yes . However, s u r e l y to g o o d n e s s y o u m u s t h a v e b e e n B u t I wa s. N a t u r a l l y I was but I de p e n d e d totally on m y b r o t h e r to p r o t e c t m y capital. 294 Q F r o m t i m e to t i m e h e w o u l d h a v e g i v e n y o u c o p i e s o f a cc o u n t s of We s t b o r o ? 11 12 W h i c h was Westboro? i n t e r e s t e d in p r o t e c t i n g y o u r c a p i t a l ? 9 10 Yes . A He d i d n ' t r e a l l y g i v e m e c o p i e s of a c c o u n t s o f 13 Westboro. 14 X, 15 w e r e g o i n g t o b e o r o t h e r w i s e b u t I d i d n ' t g et 16 B a l a n c e S h e e t s as such. 17 29 5 Q 18 A 19 296 Q H e w o u l d g i v e m e d a t a a b o u t i n v e s t i n g in Y & Z and the p o ssibilities and how good they Are you and your brother still talking? We are v e r y frequently. I see. H e is m y o n l y b r o t h e r . De s p i te the fact that he seems t o . . . (INTERJECTION)? 20 21 A 22 297 Q 23 A No, I k n o w he d i d n ' t i n t e n t i o n a l l y . . . ( I N T E R J E C T I O N ) . Have been rather c a v a l i e r ...(INTERJECTION)? B u t h e d i d n ' t i n t e n t i o n a l l y g o o u t t o c a u s e m e to 24 lose m y money. 25 M a y b e he o v e r e x t e n d e d h i m s e l f , 26 298 Q In e f f e c t , In m y o p i n i o n it w a s j u s t b a d luck. of course, w h a t he m u s t h a v e d o n e was he 27 must have pledged Westboro's 28 his b o r r o w i n g s ? 29 A I d o n ' t know. sha r e s in s u p p o r t of I s u p p o s e t h a t m u s t b e t h e case, yes. 1 2 9 9 Q. 2 A. W i t h o u t t e lling you? No, m a y b e it w a s a p e c u l i a r r e l a t i o n s h i p b u t I l e f t 3 it a l l t o him. 4 i n v o l v e d i n a n d I h a v e p u t in m y m o n e y , " a n d I l e f t 5 it t o h i m to m a k e m o n e y . 6 money. 7 30 0 Q. I s a i d " Look, m e d i c i n e is w h a t I am A s it h a p p e n e d h e l o s t Do y o u k n o w w h e t h e r o n e o f W e s t b o r o ' s investments c o u l d h a v e b e e n s h a r e s in A t l a n t i c R e s o u r c e s ? 8 9 A. 10 30 1 Q. 11 A. 12 302 Q. 13 A. Possibly, M i g h t that h a v e b e e n an e x p l a n a t i o n do yo u t h i n k ? Well, I ... ( I N T E R J E C T I O N ) . For what h a p p e n e d ? Yes. Well, 14 know that 15 shares 16 30 3 Q. 17 A. A n d he said, 19 Guinness 21 A. 22 30 5 Q. 23 A. 24 3 0 6 Q. 25 A. 26 307 Q. 27 A. 28 308 Q. 29 A. I a s k e d h i m to b u y A t l a n t i c R e c o u r s e s right. Right? problem." 304 Q. it is a p a r t i a l e x p l a n a t i o n b e c a u s e f o r me, 18 20 yes. "Oh, So, certainly. T h e r e w o u l d be no he b o u g h t t h e m t h r o u g h & M a h o n in D u b l i n . Right? To the b e s t of m y knowledge. Right? A n d . . . (INTERJECTION). These shares were b o u g h t ...(I N T E R J E C T I O N ) ? F o r me. In y o u r ow n n a m e ? T h e y w e r e to b e p u t i n m y n a m e . Is t h a t w h a t h a p p e n e d ? I never saw any share certificates but obviously I 1 t h a t is w h a t h a p p e n e d , 2 Guinness 3 o b v i o u s l y p a i d for out of W e s t b o r o Investments. 4 N o b o d y c a m e a l o n g t o m e a n d said, 5 Guinness 6 please." 7 309 Q and then I didn't pay & M a h o n for these shares. & Mahon, " y o u o w e u s £X. They were " L o o k , " fo r G i v e us a c h e q u e That didn't happen. I s u p p o s e that m i g h t be a p a r t i a l u n d e r s t a n d i n g of 8 w h a t h a p p e n e d to W e s t b o r o 9 y o u r b r o t h e r i n s t r u c t i o n s to b u y A t l a n t i c s h a r e s ? 10 A 11 31 0 Q 13 A 14 31 1 Q I c e r t a i n l y did. N o d o u b t o n e b o u g h t t h e m at a p r i c e w h i c h w a s t h e n W e l l . . . (INTERJECTION). Substan t i a l l y above the price they eventually... (INTERJECTION)? 15 A 17 18 that you gave ab o ve . ..(INTERJECTION)? 12 16 I did. Investment, I d o n ' t e v e n r e m e m b e r w h a t p r i c e t h e y w e r e at b u t that c e r t a i n l y d id happen. 312 Q 19 W a s y o u r b r o t h e r i n v o l v e d i n t h e m a n a g e m e n t of Atlantic Resources? 20 A 21 31 3 Q 22 A 23 314 Q 24 A 25 I t h i n k he was on the b o a r d of A t l a n t i c Resources. Yes? I t h i n k so, yes. Yes ? Certainly, v e r y c l o s e to t h e p e o p l e i n v o l v e d a n y way. So, I p r e s u m e he p r o b a b l y w a s o n t h e b o a r d . Yes. What has be c o m e of W e s t b o r o now? 26 31 5 Q 27 A It is n o n e x i s t e n t . 28 316 Q It is n o n e x i s t e n t ? 29 A 1 317 Q 2 A 3 318 Q 4 A 5 319 Q 6 A 7 320 Q It h a s s t o p p e d t r a d i n g ? Yes, it is. A l o n g l o n g t i m e it is gon e. H a s it b e e n f o r m a l l y w o u n d u p ? I a m s u r e t h e y did, yes. Is W e s t b o r o a c o m p a n y i n c o r p o r a t e d i n I r e l a n d ? To m y k n o w l e d g e , yes. D i d W e s t b o r o i n v e s t d o y o u t h i n k in a n y t r a n s a c t i o n s which might have been outside 8 Ireland? Not to m y knowledge. 9 A 10 3 21 Q T h a n k you? 11 A T h a n k you. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 E N D O F E X A M I N A T I O N O F DR. C O L L I N S B Y MR. ROWAN 1 2 3 4 322 Q. MR. JUSTICE COSTELLO: Just a few questions 5 Dr. 6 A. 7 32 3 Q. Collins? Yes. You said that you sold the shares that you had 8 obtained from your uncle around about the time 9 t h a t Mr. R i c h i e R y a n h a d b e e n b r i n g i n g in The F inance Bill? 10 11 A. 12 324 Q. 13 A. 14 32 5 Q. 15 Well, t h e tax, yes. T h a t w a s in 1 9 7 4 ? Right, Oka y. H o w l o n g h a d y o u b e e n b a c k f r o m t h e S t a t e s at t h a t stage? 16 A. 17 3 2 6 Q. 18 A. 19 327 Q. 20 A. 21 328 Q. 22 A. 23 3 2 9 Q. 24 A. 25 33 0 Q. 26 A. 27 33 1 Q. 28 A. 29 332 Q. 1932. I see? Yes. Y o u h a d b e e n not b e e n in the St a t e s ? No. From then? No. W hose advice did you seek? In w h a t r e s p e c t ? About selling them? Yes? M y b r o t h e r sought the a d v i c e of accountants. Who were they? S t o k e s K e n n e d y C r o w l e y t o t h e b e s t of m y k n o w l e d g e . Stokes Kennedy Crowley? 1 2 33 3 Q 3 A 4 334 Q 5 A 6 33 5 Q 7 A 8 336 Q 9 A 10 337 Q 11 A 12 338 Q 13 A 14 339 Q 15 A 17 34 0 Q 18 Did you have any contact wit h the acc o u n t a n t s ? No. N o n e at a l l ? I had my own accountants. Who were your own accountants? O'Shea Daly & Company. In C o r k ? In C o r k city. Did the y advise you? No. It w a s l e f t e n t i r e l y to y o u r b r o t h e r i n c o n s u l t a t i o n Yes . Do y o u k n o w w h o t h e a c c o u n t a n t w a s in Stokes Kennedy Crowley? 19 A 20 34 1 Q 21 A Well, n o w I k n e w t h e r e w a s a Mr. 342 Q 24 Sean Mooney. Yes? B u t t h a t is a b o u t it. or n o t I d o n ' t 22 Yes. W h e t h e r he was the a c c o u n t a n t know. D i d y o u h e a r t h e n a m e Don, Mr. D o n Reid, m e n t i o n e d at a l l ? 25 A 26 34 3 Q 27 A 28 344 Q 29 a r o u n d t h a t time . with Stokes Kennedy Crowley? 16 23 Yes, I did, yes, indeed. You did? I did, yes. That s l i p p e d y our m i n d w h e n I was a s k i n g you the q u e s t i o n a m o m e n t ago? 1 Well, y o u know, 2 people but I really don't know about these I h a d h e a r d t h a t na m e . 3 34 5 Q 4 A 5 346 Q 6 A 7 347 Q 8 A 9 348 Q 10 A 11 349 Q 12 A 13 35 0 Q S ocially then? 14 A Only socially, 15 35 1 Q 16 A 17 352 Q 18 A 19 35 3 Q 20 A 21 354 Q 22 A 23 35 5 Q 24 A 25 356 Q 26 A 27 357 Q D i d it s l i p y o u r m i n d ? Yes . A n y other names that you can recall then? No, t h a t is it. Oh, Mr. Maurice O'Kelly. Yes. W h o is Mr. Maurice O'Kelly? Well, he was a b a n k e r w i t h G u i n n e s s Yes. You h e a r d of his name? & Mahon. I m e t him. D id you? P l a y i n g gol f. yes. You never met him professionally? Never, Mr. no. M a u r i c e O ' K e l l y of G u i n n e s s & Mahon you met? Yes . D i d y o u m e e t Mr. Don Reid? No. However, Yes, you h e a r d the name m e n t i o n e d ? indeed, yes. Any other accountant? Sorry? Any other accountant? No, not that I k n o w of. Where you told that these accountants had suggested 28 a f i n a n c i a l a r r a n g e m e n t b y w h i c h t a x c o u l d be 29 avoided, Irish tax could be avoided? 1 2 358 Q. Never? 3 A. Never. 4 3 5 9 Q. 5 You ha d no idea that your b r o t h e r h a d e n t e r e d into an a r r a n g e m e n t to a v o i d tax? 6 A. 7 36 0 Q. 8 A. 9 36 1 Q. 10 A. 11 362 Q. 12 A. 13 36 3 Q. 14 Well, he t o l d m e he hadn't. He h a d n o t ? Yes. Y o u se e t h i s l e t t e r f r o m D e c e m b e r 1 9 7 6 ? Yes. From Guinness Mahon Trust Limited? Yes. Is a l e t t e r j u s t a d d r e s s e d t o t h e s e c r e t a r y o f y o u r company? 15 A. 16 364 Q. 17 A. 18 36 5 Q. 19 A. 20 3 6 6 Q. 21 A. I see, yes. Is it n o t ? It is, yes. Certainly, yes. W a s t h a t n e v e r b r o u g h t to y o u r a t t e n t i o n ? Not really, no. Pardon? I h a v e n o m e m o r y o f it b e i n g b r o u g h t t o m y attention. 22 23 367 Q. 24 A. 25 368 Q. Do y o u t h i n k is it l i k e l y ? It is a p o s s i b i l i t y . Yes. If it w a s b r o u g h t t o y o u r a t t e n t i o n w o u l d it 26 not have been clear that Guinness Mahon Cayman Trust 27 L i m i t e d w a s i n t i m a t e l y i n v o l v e d i n t h e a f f a i r s of 28 your company? 29 1 369 Q 2 A 3 37 0 Q Because I r e a l l y was not i n t e r e s t e d in business. W o u l d it n o t h a v e b e e n v e r y s t r a n g e t o s u d d e n l y f i n d 4 a company that you and your brother had established 5 ha d an in v o l v e m e n t with the Ca y m a n Islands? 6 A 7 37 1 Q 8 A 9 372 Q 10 A 11 37 3 Q 12 A 13 T h a t w o u l d h a v e m e a n t n o t h i n g t o me. N o t h i n g to you? No. Do you know w h e r e the C a y m a n Islands are? I have b e e n there. You have been there? Yes. I was t here on a c ruise ship t w o / t h r e e years ago. 14 374 Q 15 A 16 37 5 Q 17 A 18 376 Q 19 A 20 377 Q 21 A 22 378 Q 23 A 24 379 Q You did n o t . . . (INTERJECTION)? T h a t is it. Otherwise, no. You n e v e r . . . (INTERJECTION)? No. Before that then? No, no. You w ould not have known where they were? Never, no. Y o u a r e t e l l i n g us u n d e r o a t h d o c t o r ? Right. That you did not know anything about the association 25 between your company and Guinness Mahon Cayman Trust 26 Limited? 27 A 28 38 0 Q 29 A Yes . Is t h i s t h e f i r s t t i m e t h a t y o u h a v e l e a r n t o f it? Yes . 1 38 1 Q 2 A 3 382 Q This morning? 4 A This morning. 5 38 3 Q 6 A 7 Today. You b r o t h e r n ever told you? No, because I asked him before I e v e r c a m e to D u b l i n t h i s time. 8 384 Q 9 A Yes? I said, "Are you sure that t h e r e was n e v e r any 10 involvement w h atever with this Cayman business?" 11 said, "I a m p e r f e c t l y su r e " . Yes. Y o u n e v e r h e a r d o f i t? 12 38 5 Q 13 A 14 386 Q 15 A 16 387 Q 17 No. N o w . . . (INTERJECTION)? So, I t o o k h i s w o r d f o r it o f c o u r s e . W o u l d y o u j u s t l o o k at t h e p a r a g r a p h w h i c h y o u h a v e a l r e a d y r e f e r r e d to, 18 A 19 388 Q He the second paragraph? Yes . It says: " From this you will see that t h e r e has b e e n a s l i g h t r e d u c t i o n in t h e l o a n capital figure b y v i r tu e of the fact t h a t w e h a v e w r i t t e n o f f t h e I. E . C . s h a r e s at c ost. You will recall that these shares were sold and the sale p r o c e e d s c r e d i t e d d i r e c t l y to the a c c o u n t o f Dr. B a r r i e C o l l i n s at Marine M i d l a n d Bank." 20 21 22 23 24 25 26 A Yes . 27 A s I u n d e r s t a n d y o u r e v i d e n c e is t h a t p r o b a b l y it 28 w o u l d appear that some of the money, 29 money, the A merican y o u h a d -- w h i c h y o u s a i d w a s i n t h e A I B B a n k 1 i n N e w Yor k, 2 Redhall 3 A. 4 39 0 Q. 5 A. 6 39 1 Q. 7 A. 9 392 Q. The m o n e y I h a d in the B a n k n e v e r w e n t i n t o R e d h a l l ? Yes? No, I ... ( I N T E R J E C T I O N ) . C a n y o u e x p l a i n t h e n w h y t h e m o n e y w a s b e i n g s e n t to No, I ca n ' t . W h a t do you m a k e of this l etter? W hat do you mak e of t h a t p a r a g r a p h ? 10 A. Well, obviously m o n e y was put into a Marine Midl a n d B a n k i n m y n a m e in m y n a m e a n d m y . . . ( I N T E R J E C T I O N ) . 12 13 39 3 Q. 14 A. 15 16 Investments Limited? y o u r a c c o u n t in t h i s M a r i n e M i d l a n d B a n k ? 8 11 m a y have been put into this company B u t ... ( I N T E R J E C T I O N ) ? T h e w a y I r e a d it n o w is it w a s t h e m o n e y f r o m t h e pr o c e e d s of sales of m y A m e r i c a securities. 394 Q. 17 Yes. This company, Redhall Investments Limited.. . (INTERJECTION)? 18 A. 19 39 5 Q. N o w . . . (INTERJECTION). H a d b e e n i n v o l v e d in t h e s a l e o f y o u r s e c u r i t i e s a n d 20 was p u t t i n g the m o n e y f r o m the sale of your 21 s e c u r i t i e s i n t o t h i s b an k , 22 r e a d i n g it? 23 A. 24 3 9 6 Q. Is t h a t it? T h a t is m y r e a d i n g of it, s a l e of y o u r s e c u r i t i e s , 26 Cayman Island company? A. 28 397 Q. 29 A. yes. Can you explain how your money, 25 27 is t h a t h o w y o u a r e the p r o c e e d s of the got into a I h a v e n ' t a n y idea. Yes? I never even knew such a thing happened. 1 398 Q 2 A 3 399 Q It l o o k s l i k e it h e r e now, Yes. W h e n y o u s a i d y o u s o l d y o u r s h a r e s i n 1 97 4 o r 4 so, 5 was established, 6 A 7 400 Q 8 A 9 401 Q yes. and went into Westboro, I t h i n k so, was that when Westboro incorporated, first? yes. Yes? Yes . This was the time that you or your b r o t h e r d i s c u s s e d the affairs w i t h . . . (INTERJECTION)? 10 11 A Stokes Kennedy Crowley? 12 402 Q Stokes Kennedy Crowley? 13 A 14 403 Q 15 A Yes . A n d w i t h Mr. Well, M a u r i c e O ' K e l l y of Guinn e s s he c e r t a i n l y got a d v i c e & Mahon? from an a c c o u n t a n t and 16 m y k n o w l e d g e is t h a t t h e a c c o u n t a n t w a s at 17 Stokes Kennedy Crowley. 18 404 Q Yes. Di d he e v e r s h o w yo u a n y of the doc u m e n t s , 19 of t h e w r i t t e n o p i n i o n s , 20 he g o t a n y f r o m t h e m ? 21 A 22 405 Q 23 A 24 406 Q 25 A 26 407 Q 27 A Mr. Michael Pole. 28 408 Q Mr. Michael Pole? 29 A No, t h a t h e g o t f r o m them, any if he d i d n ' t . D i d he h a v e a s o l i c i t o r a d v i s i n g h i m in this m a t t e r ? Gosh , I a m s u r e h e m u s t h a v e b u t I c a n ' t say. W h o w a s y o u r s o l i c i t o r at t h a t t i m e ? My solicitor? Yes? 1 409 Q 2 A 3 410 Q 4 A 5 411 Q 6 A 7 8 I d o n ' t t h i n k so. Who was h i s . . . (INTERJECTION)? Yes, he w a s at o n e st ag e, yes. W a s he at t h i s s t a g e ? Well, n o w w h e t h e r h e w a s at t h a t s t a g e o r n o t I d o n ' t know. 412 Q 9 Who else? W h a t o t h e r f i r m o f s o l i c i t o r s w o u l d he have been with? 10 A 11 413 Q 12 A 13 414 Q I k n o w he s u b s e q u e n t l y was w i t h O ' F l y n n Exham. W h e n was that? I c a n ' t t e l l you. Yes. I don't know. At the time that you were sett i n g up this 14 c o m p a n y w i t h h i m do y o u n o t r e m e m b e r t h e f i r m o f 15 solicitors that were involved? 16 sign some documents e s t a b l i s h i n g the company? 17 A 18 415 Q 19 A I don't remember. I see? W h o his s olicitors were but the y w o u l d either have be e n O ' Flynn Exhams. 20 21 416 Q 22 A 23 417 Q 24 A 25 W h o in O ' F l y n n E x h a m s w a s t h e s o l i c i t o r ? Probably Frank O'Flynn. Frank O'Flynn? Yes. Now, t h i s is m y o p i n i o n . Now, he m i g h t t u r n a r o u n d a n d s a y t h a t is n o t true . 26 418 Q 27 A 28 419 Q 29 I probably had but D i d y o u n o t h a v e to Yes, he m i g h t . V e r y well. Thank you doctor? Yes . Ms. M a c k e y w o u l d l i k e to a s k y o u s o m e m o r e questions ? 1 2 3 E N D O F E X A M I N A T I O N O F DR. 4 COSTELLO. C O L L I N S B Y MR. JUSTICE 5 6 7 DR. COLLINS WAS EXAMINED, AS FOLLOWS, B Y MS. M A C K E Y MS. MACKEY: Just two more questions 8 9 420 Q. Dr. 10 m e e t Mr. 11 12 A. 13 421 Q. 14 A. 15 422 Q. 16 A. 17 423 Q. 18 A. 19 424 Q. 21 A. 22 425 Q. 23 A. 24 4 2 6 Q. 25 A. 26 427 Q. Desmond Traynor? Never? No. Neither s o c i a l l y ...(I N T E R J E C T I O N ) ? No. Nor through business? No. I j u s t w a n t e d t o a s k y o u a q u e s t i o n or t w o a b o u t F r a n k Lee, Right, w h o is t h e s e c r e t a r y o f W e s t b o r o ? yes. Is he s t i l l l i v i n g ? Gos h, He is, yes. yes? Yes. D i d h e c o m e i n t o W e s t b o r o at t h e s a m e t i m e t h a t y o u 27 a n d y o u r b r o t h e r i n c o r p o r a t e d it? 28 of y o u r s o r h o w d i d h e . . . ( I N T E R J E C T I O N ) ? 29 A. Did you ever No. Mr. 20 Collins. He w a s n ' t a f r i e n d of m i n e , no. W a s he a f r i e n d 1 Q. How did h e . . . (INTERJECTION)? 2 A. I t h i n k h e w a s w i t h m y b r o t h e r p r i o r to t h a t . 3 Q. In w h a t c o n n e c t i o n ? 4 A. Well, 5 Q. Yes ? 6 A. A n d still h a s . 7 Q. Yes? 8 A. A n d I t h i n k he was involved. 9 He W 8.S i n v o l v e d i that. 10 432 Q. 11 A. 12 433 Q. 13 A. 14 434 Q. 15 A. 16 435 Q. 17 A. 18 4 3 6 Q. 19 A. 20 437 Q. 21 A. Now, 22 438 Q. Yes? 23 A. 24 4 3 9 Q. 25 A. He w a s i n v o l v e d in H e f f e r n a n ' s T r a v e l A g e n c y ? Yes. T h e n he b e c a m e s e c r e t a r y o f t h i s c o m p a n y ? Yes. On the w i n d i n g up of the c o m p a n y what bec a m e of him? I t h i n k he r e s i g n e d his position. P rior to the w i n d i n g up? Yes, I t h i n k so, yes. D i d he ? Yes. W h y was that? y o u know, I a m j u s t t h i n k i n g t h i s now. This m a y not be 100% accurate. Yes? B u t m y r e c o l l e c t i o n is t h a t h e d i d r e s i g n h i s p o s i t i o n b e f o r e e v e r y t h i n g w o u n d up. 26 27 440 Q. 28 A. 29 m y b r o t h e r h a d H e f f e r n a n 's T r a v e l A g e n c y . Right. Do y o u k n o w w h y t h a t w a s ? M a y b e he w a s a f r a i d he m i g h t b e c a u g h t f o r m o n i e s . I d o n ' t kn ow. I h o n e s t l y d o n ' t kno w. You would 1 2 441 Q. W h e r e d i d he go t h e n ? 3 A. 4 442 Q. 5 A. 6 443 Q. 7 A. 8 444 Q. In C o r k ? 9 A. In Cork, 10 445 Q. 11 A. M c C a r t h y Travel. 12 44 6 Q. M c C a r t h y Travel. 13 A. He r u n s a t r a v e l a g e n c y . The same? Yes . Heffernan's No, no, still? a d i f f e r e n t one yes. W h a t is t h e n a m e o f t h e t r a v e l a g e n c y ? All right. 14 not ? 15 MR. O k ay. T h a n k you. JUSTICE COSTELLO: A. JUSTICE COSTELLO: Yes, y o u c a n h a v e t h e m if Doctor, we will require of this evidence. 20 A. All ri g h t , y e s . MR. 22 JUSTICE COSTELLO: Ms. C u m m i n s w i l l b e in t o u c h w i t h you. 23 A. Yes . 25 MR. 26 Yes. JUSTICE COSTELLO: W h e n it is a v a i l a b l e . T h a n k you. 27 28 29 or you to sign the tran s c r i p t 19 24 C a n I t a k e t h e s e w i t h me, T h a n k you. MR. 18 21 Thank you very much? y o u w i sh . 16 17 Whe THE E X A M I N A T I O N WAS THEN CONCLUDED. Mum 3% 9.0 DO GUINNESS M A H O N CAYMAN TRUST LIMITED AMantarai UwSuinmaMahonMwehwtSinkinaGroup Ttfaphoni ffa 3__«2S3/4 Titax ' . CabteArfdma • CP 303 . G u inixn • P.&Ba*887 GrindCiyman BritishWnt ImflM _ yourMl owm JXFf&L 1thVecemb&i, 1916 U>uF/umkLee . ^UtltbOAO • ..Ucntznatiz Co*k ■. *•: .IRELAND PtOXFJutnk, - - XEPHALL INVESTMENTS LIMITED X E m u n a s r ....................... I nowh oot,pli&imt «a at30£/t Wow«m6e/t maexpteMedJ LnToand-$vl($w I" «£££ 4ee ifa u Jtfceae haA bten a Aicgfti *ed«eiioft i t e £oan ■itewttbyv&vtut.°ithtla&tthatwe.futvzmitteno(AtktI E C ^ 4 W at xxHt. V ou.^**aaU thatthuTt^ t h e . 4 a Z z p n o c t e d i ci rd el da in td edBc Lk u. uctl*ytothtaccount of6.Vx' ffewua Bvutle. CollinsatMoline,m ax ThtaccompanyingTnolitandLom AccountihouamexuLutug JjtvM Wittythe.bookptofa*onexckangtAJUuZtingfama JLivataatlcm” £t-*MJnA o{SttxUna< rithe.VottwuheldbyRadhaZL ThtcthsA. iteuonthe.?Ko&itandLowAccountisthe.intextsttannedon.the. A/X-4 dtpc^Uaccountp ttoJi tothtconveAUono0{the.baZance t.ool tt hie a c&omtintoUS doUaiu. 4z z « * ■ » « * K notty, J&UkM&Un mth thz StviZwg- Accowi& > a wtW «afctcc an -fctcAerue in ik i X/Mr* batetee by vUiut o{ th t i n t e n t allowed p U o T t o c o ^ t l i . It*. FfcuiJrlee 9thVtaubVl, 1976 Vagtt Cntktassumptionthatyou.ulU 6tinv6y momtotktacaauntso{KedhallTmst, 1a*in tkt-H fft' maxne/Lvielatinga&aoimtiwhichJthinkyou. iind bothinPoundStMlihgandinU.S.dottaJU. Once*a pvSuaptyoa • wouldbe.kindenoughtoeon&Ou1 you*,a&unmxttotktAoUjJTZiluku sothattoteoneniu/uyowiK.tco*diagutKithoum. • Finally, 7 wouldmention,thattfuuuisa.smallovex.dJtaitm thtbank accounto{Kedhall.Vtustandastfuu.millbtexpttuttsoveJt.tkt— -»f twomonthsinthtla*no(GoveJumejit{eeS,etc.to* Udkattl*uestmtxt& Limited, I pHopostinUmctingfci LtamtdtodostthzA/X-4call depositaccountremittingthost{undstousioiioiedittotkteiwteitZ a no tuAo Rp er do hv aalll.InvestmentsLimited. Jtakiitthisf'tlm ■»»*■» wc ic to hug .£ap Ovexthteowtstoithtnext{cur days,I wttlbe mitinatomu.suuUmo s .*aw cc th siooth and U el nm tUiatflte io tu hnw chmeinanPound tmatuSettling allyinvol ved..S.dollajuloKthtwuSous Vowu>sincerely, . «• JM A. FURZE Encli. zEDKAU wmrmtrs ljmttw 7.0.Box W, OuutdCatfmw, S.tf.l. Butancz Shut 96,141.16 91,7S1.t4 74,0l9.4t I91,t3i.t7 US$t",141.43 HipntAtntzdbytASSETS Sa&ptnitAccount InveAtatmt Loam U&e Schedult] Fixtd VepoUt - US$ (ittNotz1 ) CallVtpMit* US# Uie tiotzZ) CufutntAccount 6t,4S0.t7 1,837.50 t0l.064.45 1i,i63.7i 790.5.T • 11.14 149.43 Mott1 Volla/ifixedDeposit r u ploatrf on dtpoi-Uvatiu 15thOctoberi 1976,maturing 15th.ApUt 1977at7t p.*. TJie U.S. TkiU.S. VoUoaCallVzpo+ltiw placedondeposit ■ ZSth 1976at41/ttp.«. Wotft g O o to b iA . ' Awte«i^ H LMau * ‘ UdkttltVuiAt Veits.Hotdutg*Ltd. t J,0S4.45 ^JQOf500*fC " • ia j$ a ~ u £ g mwALL wssr S&vtiMKtoAKHaJUuasat30ikfbvtmbt*. 1976 t- • • * • »• * (eiffuA iid Jn'l'SttA lina ) Capital A sie& i- r ... . f(litick CuMMntAeaoaxt Ltd. . ai kUaJUU dl at SCtk NovembU W t (expteUtd Xn U.S. VoXJbua1 Cccp£t&Z XtdkctU ImtUiMtnii Ltd. tl tack 1000AdaxIntuauutieimtLtd. 160 ShaJtU o i ShiMJko(USit.OOtadi Cu/uuxtAccount Appendix I 1 2 114 A. Yes. Q. Very well. Trust" and "Redhall Investment Limited"? 3 4 5 115 6 A. Yes. Q. would you tell me about that? A. I recall those. 116 Q- No, no. Tell me about it? Tell me about Redhall Trust? 9 10 11 I assume they were used to hold some of those deposits. 7 8 You Bee this refers to a trust "Redhall 117 A. X recognise the name. . Q. However, tell me more than that. came to be established in the Cayman Islands? 12 A. 13 I assume by SKC. There were a lot of companies 14 effectively pulled off shelves. 15 them. 16 118 Q. 17 119 20 21 120 22 23 121 Tell me about it then? What do you remember about I assume it held monies on deposit belonging to me. Q. Pardon? A. I assume it held monies on deposit belonging to me. 9* What monies? A. The proceeds of the sale of US securities. Q. Perhaps, you would tell me then a bit about that. This was apparently a trust established, was it? 25 122 A. I don't recall it as such as a trust. Q. Yes. 27 However, it must have got some...(INTERJECTION) ? 28 29 I remember the name. A. 24 26 That was one of it? 18 19 How was it that it 123 A. I t . ..(INTERJECTION) . Q. It must have got funds. I mean look at T 1 t h e ...(INTERJECTION)? 2 3 124 4 5 125 6 7 126 8 9 127 10 A. Yes. Q. Look over the page? A. Right. Q. You see the accounts over the page? A. Yes. Q. Balance sheet, profits it made in 1975/1976? A. Yes. Q. Tell me about how it was established Mr. Collins? A. I assume it was established between SKC and 11 12 Guinness & Mahon. 128 13 14 A. 129 15 16 Q. Yes. 130 17 A. From me. Q. Do you recall what funds you gave it and when? A. Specifically, no, but they would have b e e n the sale of US securities. 131 20 21 132 22 23 Yes. Q. Where did it get its funds from? 18 19 Mr. Lee or you got accounts about it? 133 Q. You sold US securities? A. Sold some. Q. Some? A. If not all at some stage, yes, securities. Q. Some of the securities then were sold a n d were 24 deposited then or transferred to Guinness Mahon 25 Cayman Trust Limited? 26 27 134 A. Yes. Q. Did you know Guinness Mahon Cayman Trust Limited was 28 29 a trustee company? A. Yes, I must have. 1 135 Q. You must have. Can you explain to me how this 2 Redhall Trust was established and apparently 3 Guinness Hahon Cayman Trust was managing it? A. 4 with Guinness & Hahon. 5 6 136 7 8 137 9 10 138 11 12 139 13 Q. On your instructions? A. Yes, on the foot of their advice. Q. Yes. A. Yes. Q. Can you remember that now? A. Instructing them? Q. Yes? A. What I can remember is the advice being given and 140 16 17 You did instruct them to so establish it? accepted and, "Yes, go ahead.” 14 15 It would have been established by SKC in conjunction 141 Q. What was the advice? A. The advice was to keep the monies out of Ireland. Q. No, no. It is much more specific than that. What 18 advice were you given and you said, "Go ahead”, in 19 relation to the establishment of the Redhall Trust? A. 20 manner. 21 22 142 23 24 143 25 26 144 27 28 29 The advice I was given I assume was to do it in this 145 Q. What manner? A. They already had.... (i n t b r j b c t i o n ) . Q. What manner? A. Setting up this trust. Q- Yes? A. Or deposit. Q. No, no? A. With Guinness & Mahon. . 1 146 2 3 147 Q. No, no. Let us not -- let us be more specific? A. Right. Q. You do not set up a deposit. 4 deposit. 5 Mr. Collins? A. 6 148 9 A. it was a vehicle to take monies that I gave it for deposit. 149 Q. As far as you know then was that money was on deposit? 13 150 15 16 A trust is something What can you honestly say then? 12 14 I can't honestly say it was. Q. 10 11 Was this not a trust established that goes on. 7 8 You put m on e y on 151 A. Yes. Q. Would you have a look at the accounts? A. Yes. Q. Where does it show in these accounts that the 17 Redhall Trust had money on deposit? 18 at the last page or the second last page. 19 last page. 20 affairs. 21 shares in Redhall investments. 22 A ga r International and the current a c c o u n t . 23 the trust? 24 25 152 26 27 153 Yes, the It is The Redhall Trust statement of It is capital 1,064.45. The assets: 1,000 That is . Yes. Q. Is that not so? A. That is what it says, yes. Q. There was a trust and that is the statement of affairs of the trust in 1976? A. Obviously. 100 shares in A. 28 29 Would you look 1 154 2 3 155 Q Obviously? A. Yes. Q. Then it appears that the trust held 100 shares i n Redhall Investments? 4 5 6 156 A. Yes. Q. It looks then as if Redhall Investments then was the 7 vehicle which carried on, held, the funds, is that 8 not so? 9 10 157 11 A. Yes. Q. What was Agar international Limited? A. A ga r I think was another company set up, just holding deposits. 12 13 158 14 15 159 16 17 160 18 19 161 20 21 162 22 23 163 Q. Holding deposits? A. Yes. Q. Where were the deposits? A. Pardon? Q. Where were the deposits? A. I presume GMCT. Q. Yes. A. I had funds and a brother of mine had funds there. Q. No, these particular ones? A. Yes. Q. That were being sent to Mr. Frank Lee on your 24 behalf? 25 26 27 Who was the beneficial owner of these funds? 164 A. I t h i n k . ..(INTERJECTION). Q. who owned these? A. I think Agar, in fact, was my brothers. Yes? 1 166 2 3 167 4 5 6 168 Q. A n d the other company was yours, was it? A. Redhall, Is it? Q. Yes? A. I w ould think so, yes. Q. Yes. A. Yes. Is that Dr. Collins, your brother? A p p e n d ix X V (2 0 ) L a d y C a r o le C o n y n g h a m ( f o r m e r ly C a r o le P o w e r Y o rk e ) 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Lady Carole Conyngham. a) Letter o f 13 June 1977 - Guinness and Mahon to Carole Yorke. b) Letter of 14 June 1977 - Guinness and Mahon to Carole Yorke. c) Letter of 26 August - Carole Yorke to Guinness and Mahon. d) Guinness and Mahon credit committee memo o f 30 August 1978. Sirs. Carole Yorke, 47, 3t. Maur Road. ?ulhan, LONEON, S. W. 6. Dear Carole, Capoyo Limited I enclose letter received Iron GuLnness Hahon Cayman Trust Liatited la connection with the above-mentioned company. ?roa discussions with I understand there is sane further distribution to cone from Morgan Guaranty Trust Company. However, as t’ aey ha'/a no authority to *ive us Information in this regard, I would suggest that you write to them directly requesting details of the amounts etc. Perhapc vould give jxe a call tv -is course to discuss th> .-ints raised in John Furze's letter. Sind regards. Yours sincerely. Martin C. Keane. Urs. Carole Yorke, 47, St. Maur Road, Fulham, LOKCOM, S . W. 6 . Dear Carole, .. Thank you for your letter of 10th June. I confirm that the cheque has been aent for credit to the account of Capoyo Limited with Guinness Mahon Cayman Trust Limited who have been told to hold the money on Call Deposit Account. Could you drop me a note in good time before you next come to Ireland so that we can arrange for a half day to deal with all outstanding matters in relation to the Trust etc. Kind regards* . Yours sincerely, Martin C. Keane. 4 7 J h J 0 a u r-(R o a d A u g u st 2 6 ih M* C* fo o n * 7?t Q o lle a e §n een QuLnness Mahon Du.bJ.in 2 £ in e Dean flln Keane ' Th.Lt l e t i e n i s t o co n {iA *1 my a p p l i c a t i o n t o Q u in n e ss Mahon /J o a a Loan {.on. in v e s tm e n t p u n p o se a , The amount in q u e s tio n I s tw en ty, s e v e n th o u sa n d p o u n d s { on. a p e n ta d o t s i x m onths b u t w ith a s in o n a p o s s i b i l i t y , t h a t 3 shaJUL o n ly n e e d th e lo a n {.ox {o u n m o n th s , 3 luoula p a y th e i n t e r e s t a t th e end o { s i x m onths on e a n i l e a. a s in d ic a te d . 3 w i l l p l a c e a s c o l l a t e n a l th e { n e e h o ld of. t h i s h o u se w h ich h a s b een vaJLued a t £ J J th o u sa n d a y e a n ayo» 0 am a n n a n yin y {.ok an up to d a te v a l u a t i o n w h ich s h o u ld be o v e n t h i n t y e i g h t th o u sa n d , . S e c o n d ly 3 o t { e n a s c o l l a t e n a l a yu a n n a n tee fnom Qohn Funge t h a t LfL L i s h o u ld happen t h a t th e n e i s a s h o n t { a l l upon my in v e s tm e n t t h a t he w i l l s e l l s e cun L i l e s {n o n Qapoyo L td to neim bunse y o u im m ed ia te Le 3 w i l l h o ld c e n ta in { u n d s a s i d e LfL n e q u ln e d { o n th e bene { L i o { Q u in n e ss Mahon i { su c h a n e e d a n o s e , a s in v i e a b o ve i n s t a n c e . Fnom oun c o n v e n s a tio n L i appeand t h a t 3 m iy h t be a b le t o n e c eL ve th e lo a n a t uoun e a n l i e s t c o n v e n ie n c e n e x t w eek . ant? l o o k {onw and t o h e a n in y {nom youon n e c e i p t o { t h i s l e t t e n m ifouns S in c e n l y C a X ir X ^ e Q an ole Q i/onke PS 3 c a n n o t { i n d th e v a lu a tio n anywhene a m o n yst my p a p e n s b u t w i l l tn y & y e t a c o p y • : . Minutes of the 232nd Meeting of the Banking/Credit Committee held at 17 College Green, Dublin 2,on Friday, 25th August, 1978. PRESENT: 814: M. E. O'K. - M. J. P. - J. S. M. - P. J. F. - P. O'D. - I. W. K. Mn. Carole York*: 4» Amoonh Purpose: Term: Rate: Security: Recommended. £15,000 Personal Loan 30/9/1979. 2 % over base Title Deeds of property. (Shortfall Guarantee GMCT) A p p e n d ix X V (2 1 ) M r H u g h C o v e n e y , d e c e a s e d 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Hugh Coveney. a) Telex memo o f 27 February 1976 - Guinness and Mahon to GMCT. b) Telex of 9 April 1979 - GMCT to P Collery & internal Guinness and Mahon memo - P O’Dwyer to Foreign Exchange. c) Guinness and Mahon statement of 23 April 1979 re GMCT. d) Lynbrette Trust Deed. e) Extract of evidence to Moriarty Tribunal by Hugh Coveney. TELEX MESSAGE DATE: 27th-. Peb. 1976. TEST: :rgi G.M.C.T. HC. DQT.T.ATt WBPflSTT. ’ Above natures 9/3/76 gad it is intended to keep on Call pending your arrival in Dublin. Beneficiary nay consider small investment portfolio in say six TT.S.as3*wr Stockjol substance with gxovth potential, vith approz. #60,000.00. ' Perhaus von vould consider the above and ve will discuss AUTHORISED BY: DEBIT: in due course E205 MAgs El CF TELEX APRIL 5/75 GM DUBLIN. . - COLLERY . . 9: RET- H.c. .us: DOLLAR DEPOSIT PLEASE DEBIT THE ABOVE ACCOUNT WITH THE DOLLAR EQUIVALENT 0F 5T6. - 2000.00. PLEASE THEN REMIT AS QUICKLY AS POSSIBLE THE SUM OF SIG 2000 T0 MIDLAND BANK LTD, 86 HIGH ISLE OF WIGHT FOR . CREDIT TO THE CURRENT ACCOUNT OF MR HUGH COVENEY. GUINNESS CAYMAN TRUST 3205 MARS El CW 3205 was .1.- jL?. inning; -: O'?yggr. ?pl'ehs'e piy' Chase "100195119 Sun. of ?neb1tc.u.c. - .3131. 70 I .: I . 3'45.- - . . Bank, no heat 5 8treet,'New a 83 2,280 go:- account ,3 orn'Account No. paw '42- 05 ?75";3 . ,l much .. mg w: aqr I ?2 . I GBANKM ERS.*! ... .. f.. i .ir . ■ 4 9 P « R « u A m m h n U la 8 BA b > . ■(> *>.1 . 5* C '■bUlNNCtttUHON CHMi.tlWl .v. O' M / ., '. 17CoR«f*OraMDiiMn2inBMKMUi taiK7lMMf$l§iK!& Alt# « •»-*-- .■■'.■>£!?'■■ '.'■§'■'” :«S&v*v.; .-■ (,^ V.!. »nit*t ' ,' ;;'./ ■MBWW •'. -•■ ■ £ j**'- o«»f*rV L*V:; i7»>*r« J»*W* v»p«rg pm . % ivin n ii» w + %iiiw iu r a Il itidi fnctj • gu n i« e ss m ahon ! . \ ______ ___ _ . . . . . . . . « K ■ • / « * • -i c n r s c o LEDGER ■ • " " " I* " ■ , • ..• -.Mvv WW 770289 George Town, Grand Caynan 3Y: GUINNESS MAHON CAYMAN TRUST LIMITED A Cayman Company with its registered office . . at George Town, Grand Cayman, British West Indie WHEREAS the sum of U.S. Dollars has been transferred to the said Guinness Mahon Cayman Trust Limited to the intent that it shall be held on the trusts hereinafter declared which shall be known as the ” LYNBRETTE " Trust. NOW THIS DEED WITNESSETH as follows: . 1. In this deed the following expressions shall have the following meanings (i) ' "Tha Trustee" means the said Guinness Mahon Cayman Trust Limited or other the trustee or trustees for the time being a from time to tine hereof.- ' (ii) "The Beneficiaries" means the persons specified in the First Schedule hereto. Ciii) "The Scheduled Property" means the said sum of . . * • (iv) "The Trust Fund" means: a) . . (v) ' The Scheduled Property, and b) Any further or additional Droperty «*hich any person or persons may donate to or vest or cause to be vested in the Trustee to be held uoon the trusts and with and subject ~o the oowers and provisions hereof, and c) The prooerty for the time being and from time to time representing the Scheduled .Prooerty and the further or additional oroperty (if anv) aforesaid. "The Perpetuity ^ate" means the day (aj or, which shall expire the period of Eighty years from the execution of this Deed, or (b) the day on which shall expire the period o twenty 'years from the death of the last survivor • 770270 of all descendants male and female of King George FifCh living on the date hereof (whichever- shall first occur), or (c) such earlier date as the; Trustee shall at its absolute discretion by d e e d appoint. 2. 3. 4. (vi) ’ ’ Property" means real personal movable or immovable prooerty of any description and wheresoever situate including policies cash and choses in action. (t) The Trustee hereby declares that the Trustee will hold the Trust Fund u oo n the trusts and with and subject to the powers and provisions hereinafter contained. (il) T he Trustee shall have the r ight at any time during the continuance of the trust h e r e b y created to accept such additional property as may be donated to such trust by any person or persons either personally or by testamentary act or disposition. (i) The Trustee shall stand possessed of the capital .and income of the Trust Fund i n trust for all or such one or m o r e 'exclusively of the others or other of the Beneficiaries at such age or time or respective ages or times if m o r e than one in such Shares a nd with such trusts for their resoective benefit and -such provisions f o r their respective advancement maintenance and education at the discretion of the Trustee as the Trustee shall by any deed or deeds revocable o r irrevocable executed before the Perpetuity Date appoint. (ii) No appointment shall be made revoked or revocable o n or after the Perpetuity Date. (til) Any revocable aoDointment may be made or revoked by the Trustee for the time being notwithstanding that the persons who make the appointment and revoke the appointment may not be or include the same persons. (i) In default of and subject to any such appointment as aforesaid the Trustee may until the Perpetuity date pay or apolv the whole or such part as the Trustee shall think fit of the income of the Trust Fund as it arises to or for the maintenance education advancement or benefit of all or such one or more of the Beneficiaries for the time bein^ in existence in such orooortions or manner as t h e ' Trustee shall in the uncontrolled discretion of the Trustee from time to time think fit; (ti) Subject as- aforesaid the Trustee shall until cha 770271 Petpetuity Date deal with the income of the Trust Fund or so ouch thereof a? shall not be paid or applied as aforesaid by accumulating the same as an accretion to the capital of the Trust Fund. . 5, In default and subject as aforesaid the Trustee shall stand possessed of the capital and income of the Trust Fund upor trust for such of the Beneficiaries as shall be in existence immediately before the Perpetuity Date if more than one in such share as it shall think fit in its absolute discretion or if there shall be no such person then uoon trust for the charitable institution named in the second schedule hereto absolutely. o. The Trustee shall have and may exercise at its absolute discretion at any time or times and from time to time power to pay or aoply the" whole or any part or parts of the Trust Fund to* or for the advancement or benefit of all or any one or more exclusively of the others or other of the Beneficiaries in such manner as the Trustee shall in its absolute discretion without being liable to account for the exercise of such discretion think fit including the purchase of an a nn u it y .for any . Beneficiaries but so that the Trustee m a y at any time but at its absolute discretion releese this present power in whole or in part. ' 7. Notwithstanding any of the trusts Dowers and orovislons herein contained the Trustee shall have Dower at any time or times before the Perpetuity Date by deed revocable or irrevocable to release any power right or discretion vested in the Trustee under the trusts hereof. • 8. No benefit devolving on any Beneficiary under this trust shall form or constitute’a portion of any communal or joint estate of such Benefi&iary but such benefit shall be and remain the sole separate and exclusive property of sUch Beneficiary and should such Beneficiary be married o r marry in community of property then any benefit so devolving shall be expressly excluded from the community and in the case of the Beneficiary being female such benefit shall also be free from the interference control or marital oower of any husband of such Beneficiary for the eurposes of this Clause the word "benefit” shall include movable and iremovable property and the provisions of this Clause shall apply moreover not only to the benefits actually devolving on any Beneficiary but also to the property for the time being representing the same anc the incone thereof. ’ 9. In addition to all the powers vested in trustees by law or statute the Trustee without the interposition of any Beneficiary shall have and may exercise from time to time the following powers: To retain any nroperty belonging to or forming p».rt of the Trust Fund in the actual state or condition in vhich the same shall be received bv the 7 7 0 9 7 ?. Trustee so long as the Trustee shall think o r o D s r - ' without being answerable for any loss occasioned thereby. (11) To sell alienate or otherwise dispose of all or any property at any time forming part of the Trust Fund in such manner by public or private treaty and for such price in money or other consideration and on such conditions as the Trustee may think prooer and to receive the consideration price and grant discharges therefor. (ill) To exercise all the voting oowers attaching to any shares stock debenture or other securities (hereinafter called '’ securities") at any time forming part of the Trust Fund. (iv) - To exchange property for o t he r property of a like or different nature and for such consideration and on such' conditions as- the Trustee may consider advisable. (v) To comoromise and, settle for such consideration ' and upon such terms and conditions as the Trustee may consider advisable all matters arising in relation to the trusts hereby created or the Trust Fund and all such compromises and settlements shall be binding on all the Beneficiaries. (vi) ‘ To surrender and. deliver up any securities forming part of the Trust Fund for suh consideration and upon such terms and conditions as the Trustee - may approve to any -company or corporation reducing . its capital and the Trustee ma y receive such consideration i n the form of cash securities or other assets &s may be agreed between the Trustee and such other corporation. (vii) To consent to any re-organisation or re-cons true tior. of any company or corporation the securities of which form part of the Trust Fund and to consent to any reduction of capital or other dealings with such securities as the Trustee nay consider advantageous or desirable. (viii) To invest or lay out any moneys forming part of • the Trust Fund or the proceeds of sale without regard to the provisions of The Trusts Law (Law 6 of 19S7) or any Act passed in amendment thereof or in substitution therefor in the purchase cf or at interest up o n the security of such stocks funds shares or* securities or other investmer.es or property movable or immovable of whatsoever nature and situated anywhere in the world and whather in possession or. reversion (including 7 7 0 2 73 the purchase o£ any freehold or leasehold land wlch* or without any house or other buildings thereor . or plant or live or dead stock or chattels for the beneficial occupation use or enjoyment of any Beneficiary or Beneficiaries ana Including any policy of assurance on ths' life of any person or any endowment or other policy and the payment of the premiums in respect thereof) and whether in the name of the Trustee or in the names of nominees or in any other manner giving the Trustee control of the .same or upon such Dersonal credit with or without security*as the Trustee at its absolute discretion shall think fit and in addition (but without prejudice to the generality of the powers hereby given) trust moneys may be laid but in paying for any improvement addition alteratic demolition amendments cleaning repair to or of any hquse or other building or chattels ' for the time being forming part of the Trust Fund to the intent that the Trustee shall have the same full and unrestricted power of investing and varying investments and property in all respects as a beneficial owner (including all the powers . of a beneficial gvner as regards charging leasing •• management and otherwise in respect of any ' freehold or leasehold property including surrender­ ing or dealing with any policy of assurance forming part of the Trust Fund). (ix) To purchase or otherwise acquire or to invest reinvest or refrain from investing the Trust Fund wholly or partially in common stock or in any other*securities (without regard to whether such shall.be listed on.any stock exchange or other public market' registered with any securities commissions or similar bodies or subject to ‘ contractural legal or other restrictions including "investment letter" restrictions) or other type or types of assets whether or not such assets ' snail be productive of income or shall constitute "Securities" in any sense including but not limited to bonds notes debentures mortgages preferred stocks puts or calls beneficial Interests in land trusts interests or shares in common trust funds mutual funds "open-end" or "closed-end" investment trusts or funds real estate investment trusts or savings and loan or building and loan associations oil gas or other mineral interests or natural resources livestock or other animals comodities foreign exchange insurance or endowment policies annuities variable annuities or other property or undivided interests in property foreign or domestic and the Trustee is expressly authorized to make speculative investments if it deems such advisable without limitation by any ‘ prudent man r ul e 1 or rule of reasonableness or any other statute or rule of law regarding investment by trustees and the making of such investments shall in no event be construed as a breach of trust and-in that connection without limiting the generality of the foregoing to invest the Trust Fund or any part thereof in any oartnership limited partnership joint venture or association and to be able to have and exercise all the powers of management ana participation in.the management necessary and incident to an investment in such partnership limited partnership or other venture including ' the incurring of joint and several liabilities . with other members and the making of any election available under any tax law by such partnership or venture and at any time to participate in the incorporation of any such partnership or vednture to op.en accounts margin or otherwise with brokerage firms, banks or other wheresoever in the world to invest the funds of the Trust Fund in and to conduct maintain and operate such accounts directly or through an agent for the purchase sale and exchange of commodities stocks bonds and other securities and in connection therewith to borrow money obtain guarantees and engage in all other activbities necessary or incidental to conducting maintaining and operating such accounts. ; ’ t (x) T o pay out of the income or capital of the Trust Fund all the costs of and incidental to the preparation execution and stamping of this Deed. (xi) T o determine whether any sums received or disbursed are on account of capital or income dr partly on account of one and partly on account of the other and in what proportions and the decisions of the Trustee whether made in writing or implied from the acts of the Trustee shall be conclusive and binding on all the beneficiaries. (xii) . a) To employ and pay for such professional or other assistance as the Trustee may deem requist in the discharge of the duties of the Trustee. « b) To act oh the opinion or advice of information obtained from any financial adviser . lawyer valuer surveyor broker auctioneer or other expert or professional person and so that the Trustee shall not be responsible for any loss depreciation or d a m a g e occasioned b y acting or not acting in accordance therewith. j ' ! : (xiii) To determine all questions and matters of doubt which may arise in the course of the management administration realisation liquidation partition or winding up of the Trust Fund. I Ii 770275 (xiv) Generally to perform all acts of alienation •• hypothecation and other acts of ownership to the same extent and with the same effect as tha Trustee might ■have done if it had been the beneficial owner and the decision and action of the Trustee . whether actually made or taken in writing or impller! from the acts of the Trustee shall be conclusive and binding on all the Beneficiaries. (xv) (xvi) To erect buildings on and effect improvements to any property forming oart of the Trust Fund and also to conduct farming operations on and lease all or any part of such-property. . To institute and defend proceedings at Law and to oroceed to the final end and determination thereof or compromise the same as the Trustee shall consider advisable. (xvil) To incorporate any company or companies in any place in the world at the' expense of the Trust Fund with .limited or unlimited liability for the purpose of (inter alia) acquiring the whole or any part of the Trust Fund the consideration on the sale of the Trust Fund or any part thereof . to any company incorporated pursuant to this sub­ clause may consist wholly or partly or fully paid debentures or debenture stock'or other securities of the company and may be credited as fully paid and may be allotted to or otherwise vested in - . the Trustee and shall, be capital moneys in the Trustee's hands. . tI (xviii)To exercise or concur in exercising the voting and'other.rights.attaching to any securities for the time bein^ forming part of the Trust Fund so as to become a director or other officer or employee of any company and to bs entitled to . vote and to be Daid anei to retain for the Trustee's use and benefit reasonable remuneration for the Trustee's services. . (xix) . To borrow money whether on security of the Trust Func or otherwise at any time and from time to time and pay or apply the money so raised in any manner in which money forming part, of the capital of the Trust Fund may be paid or applied, and to execute and delii such security documentation for said loans as may from time to time be required. (xx) To deposit the securities title deeds and other documents belonging or relating to this Trust for safe custody witih any bank. • (xxi) To hold any part of the Trust Fund in the name or the names of any nominee of the Trustee. . ! j (xxii) In Che event Chat income or capital shall become distributable Co a minor beneficiary or Co a ■beneficiary under.ocher legal disability or , Co a beneficiary noC adjudicated incompetent by reason or illness or' tnencal. or physical disability is in the opinion of the Trustee unable properly to administer such amount:s then such amounts may b e •paid out by the Trustee in such one or more of the following ways that the Trustee shall deem best (i) directly to the said beneficiary (ii) to the legally appointed guardian or committee of such beneficiary (iii) to a parent or some relative or friend for the care and support and . education of such beneficiary or (iv) by the Trustee using such amounts directly for* the benefit of s u c h .beneficiary and as regards (ii) and (iii) without having to see to the application thereof and the receipt of any such distributee shall constitute a full release and discharge of the j Trustee. a j (xxiii)In the event of any Income nrobate estate or other duties fees or taxes becoming payable in the Cayman Islands or elsewhere in respect of the Trust Fund . or any part thereof on the death of any Beneficiary or othexvise- at its discretion to pay all or any ' . part of such duties fees -and taxes out of the Trust Fund without recourse against any beneficlarv • o r to refuse to pay the same, or any part thereof ’ unless indemnified and to determine the time and manner of such payment (If any). j . [ • 10. Notwithstanding any of the trusts powers and provisions h er e in contained the Trustee shall have power at any time or times before the Perpetuity Sate at the absolute discretion of the Trustee by any .irrevocable deed or deeds and without infringing the rule against perpetuities to apppoint that the whole or any part of the Trust Fund shall thenceforth be held upon the trusts and with end subject to the powers and provisions o£ any other trust (Including this present proviso) not infringing the rule against perpetuities applicable , to this trust and approved by the Trustee and in favour or : for the benefit of all or anv one or more exclusivelv of the I others or other of the' Beneficiaries and upon any such appoint­ ment being made the Trustee may transfer to the trustee or trustees for the time being of the said other trust the propertv comprised in the said appointment and thereupon the trusts herein declared concerning such property shall cease and determine and the said property shall for all purposes be subject to the trusts powers and provisions contained in the said other trust and be subject to and be governed by the proper law cf the said other trust whether such proper lav; shall be the proper law of this trust or not. • 11. Notwithstanding any of the trust powers and provisions herein contained the Trustee shall have power at any titae 7702 7 7 I l I j or times b efore the Perpetuity Date and without infringing the rule a g ai n st perpetuities at the absolute discretion of tha Trustee by any irrevocable deed or deeds to retire as Trustee and to appoint a new trustee or new trustees outside the Cayman Islands as Trustee hereof and to declare that the trusts hereof shall be read and take effect according to the laws of the country of the residence of incorporation of such n e w trustee or trustees and upon such appointment being made the Trustee shall immediately stand possessed of the trust fund upon trust for the new trustee or trustees and shall transfer the same to the new trustee or trustees as soon as possible so that the Trust Fund shall continue to be held uoon the trust hereof but subject to and governed by the law of the country of residence or incorporation of such new trustee or trustees a n d thereafter the rights of all persons and the construction a n d effect of each and every provision hereof shall be subject to the exclusive jurisdiction of and construed only according t a the law of the said country which shall become the foruas for the administration of this trust (but so that nonetheless the. Trustee or the n e w trustee or trustees may by deed declare that the trusts hereof shall continue to be read a n d take effect according to the laws of the said Cayman Islands as orovided by Clause 20 hereof) AND Clauses 17* and 20 h er e of shall take effect and be subject to the trusts hereinbefore declared by this Clause A ND any such new trustee or trustees m a y bv deed make such amendments hereto as are necessary to ensure that the crusts hereof are effective and legal i n such n e w jurisdiction. 12. The Trustee shall keep accurate accounts of its trusteeshio a nd may have them audited annually at the expense of the Trust Fund or th.e income thereof as .the Trustee shall determine b y a firm of accountants selected by the Trustee, i . I* ' i : I ' . . • 13. The customary expenses in connection with the adminis­ tration of this trust including the remuneration and charge of the Trustee hereinafter provided for and of the investment and reinvestment of any part of the Trust Fund and the collectior of income and other sums derivable therefrom shall be charged against the income of the Trust Fund but if such income is insufficient for that purpose then the same shall be charged against capital or so much of the capital as m a y be required in addition to the income for that purpose. * 14. The Trustee may appropriate any part of the Trust Fund in the actual state or condition of investment thereof at the time of appropriation in or towards satisfaction of the j share of any person in the Trust Fund as to the Trustee may I seem just and reasonable according to the respective rights j of the persons interested in the Trust Fund. II i j 15. j ! !; ' (1) . A n y Trustee being a trust company or corporation shall be entitled to charge and be paid out of tha Trust Fund and the income thereof remuneration • in accordance with its scale of fees now and from . 77027S * n time to time in force and may without accounting • for ar.y resultant profit act as banker and perform any service on behalf of the Trust estate and on the same terms as would be made with a customer. (ii) Any Trustee being a lawyer chartered accountant or other person engaged in any profession or busines shall be entitled to charge and be paid all usual professional and other charges for business transacted time spent and acts done by him or . any partner of his in connection with the. trusts hereof included acts which a trustee not being in any profession or business could have done . personally. ‘ 16. The Trustee shall not be reaulred to give bond or security for the due and faithful administration of the Trust Fund or for the discharge of the.trusts hereby created. I 17. (i) The power of appointing a new trustee or new trustee • ! hereof shall be vested in the Trustee or the persona j representatives or the liquidator of the last ‘ . surviving Trustee ..-and suck power shall extend [ •to the appointment of a new trustee or new trustees i in the place of any Trustee resigning its I trusteeship and also to the appointment of an : additional •trustee or .additional trustees up . to any number subject to such limit (if any) as may for the time being be imposed by law. (ii) { i : , j : I t i I j j 1 = ! Any Trustee may at any time resign the trusteeshio on giving not less than fourteen days notice . addressed to the other trustees (if any) or if . there are’no other trustees on appointing a new. trustee or new trustees in the place of the retiring ‘* Trustee and any such notice of resignation shall be deemed to operate so as to vest all of the property forming the Trust Fund in the continuing trustee or trustees. ~ (ill) .The office of a Trustee shall be ipso facto determined and vacated if such Trustee being an individual shall be found to be a lunatic or of unsound mind or if .he shall become subject to the bankruptcy laws or if such Trustee being a company shall enter into liquidation whether compulsory or voluntary (not being merely a voluntary liquidation for the purposes of amalgamation or reconstruction). * * (iv) Notices of all changes in the.trusteeship shall • be indorsed on or attached to these presents signed by the surviving or continuing Trustee and every such notice shall be sufficient evidence to any person having dealings with this Trust as to the • facts to which it relates. 770279 ________________________________ (v) . 18. • (vi) Any person dealing with this Crust may rely uoon a copy of these presents and of the notices endorsed thereon or attached thereto certified by the Trustee or the Trustee's lawyer before a Notary Public to the same extent as he might'.'rely on the original. Unless there shall be a single trustee the Trustee shall act only by a unanimous vote but in Che event of a disagreement ths Trustee shall be bound . to take and abide by the opinion of Counsel. (i) Every discretion or power hereby or by law conferred on the Trustee shall be an absolute and uncontrolled discretion or power and no Trustee shall be held liable for any loss or damage accruing as a result of the Trustee' concurring or refusing or failing to concur in an exercise of any such discretion or power. ■ . (ii> No Trustee shall be liable for any error of judgment or mistake of law or other mistake or for anything save the wilful misconduct or wilful breach of this Trust by such Trustee and each Trustee shell be held harmless against any claitss losses death duties taxes and impositions arising in connection with the Trust Fund or any part thereof. 19. Every Trustee who is a corporation or company may exercise or concur in exercising any discretion or power hereby conferred on the Trustee by a resolution of such corporation or company or by a resolution of its Board of Directors or governing body or may delegate the right and power to exercise or concur in exercising any such discretion or power to any one .or more o.t its directors, officers or employees. 20. This Trust is established under the laws of the Cayman Islands and if and so long as the power contained in Clause 11 hereof shall not have been exercised the rights of all parties and the construction and effect of each and every provision hereof shall be construed only according to the iaw of the said Cayman Islands which shall be the forum for the administration of this trust. 21. The Trust hereby crested shall take effect immediately on the execution hersof and be irrevocable. 22. No Beneficiary of this Trust shall have any right to aLienats, encumber or hypothecate his interest therein, nor shall such intersts of any Beneficiary be subject to claims of his creditors, or liable to attachment, execution, or ocher process of law. The income of this Trust shall not be pledged, "assigned, transferred, sold, or in any manner whatsoever accelerated, anticipated, or encumbere by any Beneficiary, nor shall any incona of this Trust be in any manner subject • or liable in*the hands of Che Trustee for the debts, contraccs, f ! j • j \ ; j j ■ j or encroachments of any Beneficiary o r b e subject to any assignment o r any other voluntary o r involuntary alienation or disposition whatsoever prior to the distribution of all or part of the sadLd income to that Beneficiary. . 23. The Trustees shall have the power to lend, with or without security, and upon such terms and conditions as the Trustees may determine, to any of the Beneficiaries named in The First Schedule attached hereto. IN WITNESS W HE R E O F this Deed has b e en duly executed the day and year first b e fo r e written. ^ The Common Seal of GUINNESS MAHON CAYMAN TRUST LIMITED was hereunto affixed bv T o h m ' ft. S o u i n Is ______ and by ToHfJ ft. FutfXg b y order ox the Board of Directors in the presence of: Witness 770281 SPARTACUS HOLDINGS LIMITED ECLIPSE HOLDINGS LIMITED YALE SECURITIES LIMITED . MEDFORD INVESTMENTS LIMITED OVERSEAS NOMINEES LIMITED ' ' all being companies registered under the laws of the Cayman Islands and having their Registered Office at: P. O. Box 887/ Grand Cayman, B.W.I. THE SECOND SCHEDULE The Cayman Islands Branch of the British Red Cross Association. . 770282 - r* b* Strfctlv Private and Confidential 3. U Li i^ j £ Q vZ Si U.S. Property venture; In 1980 a Mr Jim Cummins, an Irish American who lived part o f the year in Co Cork and who was w ell known to two friends o f mine, Neil Collins and Frank Boland, approached them about a possible property investment in Arizona. This was being promoted by a real estate colleague o f Mr Cummins, Mr Keith Smith. There was a third American involved as well, Mr Harry Bidwell. . ^ v . ' '/!: L The initial property investment related to the development near Phoenix, Arizona o f a 90 acre residential trailer park (mobile homes) and associated amenities. These type of developments in a ‘sun belt’ location like Phoenix were piarticularly attractive at that time to seasonal retired residents from the colder Northern States. . . The 3 American investors were advised, for U.S. tax planning purposes, to seek out 50% non U.S. partners and to operate from an acceptable and established off-shore location. • 1 was asked by either N. Collins or F. Boland if I would be interested in looking at the merits o f the proposal. They asked a few other business friends as w ell. The group comprised, in addition to N eil Collins and Frank Boland, Mr Clayton Love Jnr., Mr Pat Dineen and myself. . / ’’"N * **» • *'• 5 ‘ At that time N eil Collins had extensive business interests in the U.S. and had established a close banking relationship with AIB in New York. Accordingly, he approached them about putting up the bulk o f the funds for this property investment. A detailed assessment o f the project was undertaken for A.I.B. and for the proposed Irish participants by the New York office o f property consultants, Jones Lang Wootton. They visited the site in Arizona and reported positively on the development and profit projections ($ 10m). Guinness and Mahon who were w ell known to most o f the Irish group were also contacted. Mr Desmond Traynor o f that bank advised about the kind o f structure required to meet the demands o f the project The structure envisaged the establishment o f an entity known as the Lynbrett Trust Guinness Mahon Cayman Trust Ltd. was the trustee for the Lynbrett Trust The beneficiaries o f Lynbrett Trust were to be five registered Cayman Islands companies. I would be givien an option to acquire one o f these companies, Eclipse Holdings Ltd., on terms which I shall outline later. Under the arrangements negotiated with AIB New York, AIB would lend 52.775m to Lynbrett who in turn would lend it on to Mr Keith Smith’s company, Roadhaven Resorts Inc. This was an Arizona corporation responsible for carrying out the developments. Legal and tax advice was obtained to confirm that the proposed structure was in conformity with U.S. tax law. Personal, joint and several guarantees were required by AIB from the five Irish participants. I signed the guarantee at AIB, 66 South Mall, Cork on the 23rd o f June 1981. A o Lynbrett was to participate in 50% o f the profits from the developments (after the repayment o f loans). The U.S. investors were entitled to the other 50%. It was envisaged that the group would involve itself in other similar property opportunities and a second project, Bullhead City, was under active consideration. In to the A.I.B. borrowing o f $2.775m the Lynbrett Trust was also required to put up $950 000 in the initial development My share o f that amounted to $212 500 (22%).I negotiated a venture capital type arrangement with Desmond Traynor acting for Guinness Mahon Cayman Trust Ltd. That arrangement involved G. M. Cayman Trust providing a loan facility o f up to $500000 to Eclipse Holdings Ltd. for the purpose o f investing in the Lynbrett Trust Eclipse Holdings was entitled to it’s share (approx. 22%) o f Lynbrett’s profits. Eclipse was owned by G. M. Cayman Trust and it had to repay G. M. C. T. the amount loaned together with 40% o f Eclipse’s share o f Lynbrett’s profits. This 40% profit share was in lieu o f interest In exchange for my personally guaranteeing £50 000 sterling o f Eclipse’s borrowings I was given an option to acquire all o f the shares in Eclipse at par (£50) as soon as the amount loaned to •Eclipse had been repaid together with the 40% profit share. This structure m»/te good commercial sense for me in that it limited my financial exposure while entitling me to 60% o f E clipse’s profits. Unfortunately events conspired to ensure that I never acquired Eclipse Holdings. . Despite the attractive projections and extensive due diligence carried out by AIB and ourselves the enterprise ultimately turned out to be an unmitigated disaster and an absolute nightmare for tiie other Trfoh participants and m yself Roadhaven filed for bankruptcy in 1985; the securities put in place against our borrowings from AIB by AIB’s lawyers proved to be defective and practically worthless and we were left fighting a number o f actions to try to minimise our losses. AIB N ew York called on the guarantors, by letter dated February 18th 1986, to pay, within 30 days, the sum o f $2 527 730. A protracted and publicised dispute followed between AIB, their lawyers and ourselves which was ultimately settled out o f court late in 1993. - That settlement involved each o f the five o f us in net payments o f practically $400 000 (spread over six instalments). To add to our misery one o f the five, Neil Collins was unable to meet his commitments under the terms o f the guarantee and the other four have had to pay his share as w ell which brings the overall cost for each o f the four up to practically $500 000. ($2.4m to AIB less $425000 from lawyers.) G. M. Cayman Trust called on my £50000 sterling guarantee by letter dated August 14th 1987 and I paid it, in Irish Pounds, in October 1987. To do so I had to sell 50000 shares in Aran Energy. I endorsed the IR£ cheque from Stockbrokers Goodbody James Capel and sent it to Desmond Traynor with a covering letter, both for transmission to G. M. Cayman Trust Receipt was acknowledged by letter from G. M. C. T. dated October 29th 1987. A p p e n d ix X V (2 2 ) M r G e o rg e C r a m p to n 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr George Crampton. a) Transcript o f evidence of Mr George Crampton dated 8 February 2000. b) Statement of Mr George Crampton o f 3 February 2000. c) Profit & Loss a/c for year ended 31 December 1974 - Starling Securities Limited. d) Balance sheet as at 31 December 1974 - Whitethorn No 6 Trust. e) Starling Securities Limited call deposit a/c with GMCT - June 1973. f) Letter of 6 January 1977 - Guinness and Mahon to Mr George Crampton. g) Letter o f 8 March 1972 - Kennedy Crowley & Company to Mr George Crampton. h) Letter o f 10 March 1978 - Mr George Crampton to GMCT. i) Letter o f 13 March 1978 - GMCT to Mr George Crampton. j) Undated handwritten note by Mr George Crampton entitled Cork Investments USA. k) Facsimile of 10 October 1994 - Ansbacher Cayman Limited to IIB. 1) Profit & Loss a/c to 30 September 1985 - Starling Securities Limited, m) Balance sheet as at 30 September 1996 - Starling Securities Limited. UNDER OATH ON TUESDAY, 8TH FEBRUARY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. GEORGE CRAMPTON Instructed by: JERRY SHEEHAN SHEEHAN & CO I CLARE STREET DUBLIN 2 EXAMINATION WITNESS MR. G. CRAMPTON QUESTIONS 1 - 281 MR. JUSTICE COSTELLO MS. MACKEY 28 2 - 307 MR. ROWAN 308 - 338 MR. JUSTICE COSTELLO 33 9 - 358 ?wallyw? .. .A $3.3 4:017? Cray/09 U?w7hr 0 1 2 3 4 MR. GEORGE CRAMPTON, HAVING BEEN SWORN, WAS EXAMINED 5 AS FOLLOWS BY MR. JUSTICE COSTELLO 6 7 1 Q. MR. JUSTICE COSTELLO: 8 Mr. Crampton, I will ask you some questions and 9 then my colleagues will ask you some questions. 10 propose to have a break at 11.00 for a cup of 11 coffee. 12 A. 13 2 Q. Fine, yes. Mr. Crampton, just for the record, would you just 14 tell us what your position was in G&T Crampton 15 Limited in 1948? 16 A. 17 3 Q. 18 A. 19 4 Q. I was a Director. You were a Director? Yes. Did you continue then as a Director and are you 20 still a Director of the company, or have you 21 retired? 22 A. I continued as a Director and then I became a Joint 23 Managing Director and then Managing Director. 24 a Chairman at the moment. 25 5 Q. 26 A. 28 6 Q. 29 I am You were closely connected with the company for many years ? 27 We Yes. It was and is a very substantial construction 1 2 7 Q 3 Mahon; is that right? 4 A 5 8 Q 6 A 7 9 Q 8 A 9 10 Q 10 A 11 11 Q 12 A 12 Q 15 A 17 13 Q 18 The joint venture in Crampton Housing. Was this a company constructing houses? Correct, yes. What sort of turnover did it have? That now, I couldn't ...(INTERJECTION). Was it substantial? It was substantial, yes. It was at the time of a You became acquainted during that time with Yes . Was this a fairly close relationship that you developed with Mr. Traynor? A 20 21 What was that? Mr. Traynor; is that is correct? 16 19 Yes . recession. 13 14 You had a business relationship with Guinness & Not that close with Mr. Traynor, it was more the Crampton Housing relationship with Maurice O'Kelly. 14 Q 22 Maurice O'Kelly, who was a Managing Director, I think? 23 A 24 15 Q Correct, that was it, yes. You obtained advice then, according to the statement 25 that you prepared for us, from Mr. Don Reid of 26 Kennedy Crowley ...(INTERJECTION). 27 A 28 16 Q 29 A Correct. ... on the tax aspects of certain proposals? 1 17 Q. 2 A. 3 18 Q. 4 A. 5 19 Q. 6 A. 7 20 Q. 8 A. 9 21 Q. 10 A. Was Mr. Reid your p e r s o n a l acc oun ta nt? No. Who was your p e r s o n a l acc oun ta nt? Craig Gardner. They have been s i n c e your p e r s o n a l a c c ou nt a nt s? Yes. Who sug ges te d t h a t you would c o n t a c t Mr. Reid? That was done in 1974 through Mr. John Lowe. Of C h a r te r House? By C h a r te r House, c o r r e c t . He had got th e advice from Don Reid. 11 12 22 Q. What i s C h a r te r House, Mr. Crampton? 13 A. 14 23 Q. I t i s a branch, i s i t , of a bank? 15 A. I am not too su re about t h a t now. 16 24 Q. 17 A. C h a r te r House i s a company of T r i n i t y Bank. What was your conn ectio n with C h ar te r House? We d id two developments with them; one f o r th e Court 18 Laundry s i t e and th e o t h e r with th e s i t e in 19 Donnybrook. 20 25 Q. The C h a r te r House, you say you d id development with them ...(INTERJECTION). 21 22 A. 23 26 Q. 24 A. 25 27 Q. 26 A. 27 28 Q. 28 A. 29 2 9 Q. J o i n t v e n tu re . Were th e y f i n a n c i n g th e ve nt u re ? Yes. They were? Yes. We were b u i l d i n g . You were b u i l d i n g ? Yes. Mr. Lowe then gave you some advice and i t was as a 1 r e s u l t of h i s i n t r o d u c t i o n t h a t you met Mr. Don 2 Reid? 3 C orrect. 4 30 Q Now, Mr. Crampton, b e f o r e we go any f u r t h e r I would 5 j u s t l i k e you to fo rm al ly i d e n t i f y th e documents 6 t h a t you have handed in to us. 7 p a r t of th e r e c o r d . 8 us ? 9 A 10 31 Q I want t h e s e to be You p r e p a r e d a st at em e nt f o r C orrect. I f you could j u s t i d e n t i f y t h a t st a t e m e n t - - we w i l l c a l l t h a t E x h i b it 1? 11 12 A 13 32 Q Yes . Your s o l i c i t o r forwarded to us two f i l e documents; 14 one was a document re S t a r l i n g S e c u r i t i e s Limited, 15 and r e l a t e d correspondence, E x h i b it 2, and th e o t h e r 16 i s documents re loan f i l e , E x h i b it 3? 17 A 18 33 Q 19 Yes . We would l i k e you to i d e n t i f y th os e f o r m a ll y and th e y w i l l be p a r t of th e e x h i b i t s of your evidence? 20 A 21 34 Q Yes, t h a t i s c o r r e c t , yes. T h i rd ly , your s o l i c i t o r , Mr. Sheehan, s e n t us by 22 l e t t e r of 7th February a f u r t h e r bundle of 23 documents, and a schedule c o n t a i n i n g 13 documents, 24 E x h i b i t 4, and I t h i n k t h i s morning we got a f u r t h e r 25 l e t t e r from Mr. Sheehan, a copy l e t t e r , which was 26 s e n t by Mr. C o l l e r y t o S t a r l i n g S e c u r i t i e s , and we 27 can add t h a t to th e f i l e so t h a t we won't have too 28 many e x h i b i t s , E x h i b it 5. 29 1 35 Q. Now, i f you would l i k e to j u s t ta ke your st a t e m e n t, 2 E x h i b i t 1, I would l i k e to go through your 3 s ta t e m e n t, Mr. Crampton, with you and j u s t ask you 4 t o expand on c e r t a i n p o i n t s ? 5 A. 6 36 Q. 7 Yes. Halfway down th e page, you begin by saying: "Don Reid of Kennedy Crowley Accountants a dvis e d on th e t a x a s p e c t s of th e p r o p o s a l s . " 8 9 10 A. 11 37 Q. C o rr e c t, yes. I t appears in th e documents you have given us t h a t 12 you got ad vice on the t a x a s p e c t s of th e development 13 of th e s i t e ? 14 A. 15 38 Q. 16 Yes. Mr. Lowe gave some adv ice, and d id Mr. Reid give advice a ls o? 17 A. 18 39 Q. 19 C o r r e c t. P a r t of t h a t ad vice was th e e s t a b l i s h m e n t of companies in th e Cayman I s l a n d s ? 20 A. 21 40 Q. 22 A. 23 41 Q. 24 Yes. That was done, I th in k? That i s r i g h t . Also, p a r t of t h a t advice was the e s t a b l i s h m e n t of a Tr u st , a D i s c r e t i o n a r y Tru st? 25 A. 26 42 Q. Right. That was p a r t of th e advice t h a t r e l a t e d t o the 27 development of th e Court Laundry; i s t h a t r i g h t , Mr. 28 Crampton? 29 1 43 Q. 2 A. 3 44 Q. The Court Laundry s i t e . Yes. Now, you a l s o got advice from Mr. Don Reid, which 4 was s e p a r a t e ad vice , about th e e s t a b l i s h m e n t of a 5 Tr us t which would take th e money which would be 6 a d m i n i s t e r e d by "Ansbacher", th e company t h a t i s now 7 known as "Ansbacher" - - remember, t h i s was a 8 s e p a r a t e advice? 9 A. 10 45 Q. That i s c o r r e c t . What I want to know i s , was th e Tr us t which was 11 c r e a t e d as a r e s u l t of th e advice given by Mr. Lowe 12 a s e p a r a t e Tr us t to th e Whitethorne No. 6 T ru st, 13 with which we a re concerned today? 14 A. 15 46 Q. 16 A. 17 47 Q. 19 A. 20 48 Q. 21 I t was th e same T r u st , yes. There was only one There was only one Trust? Yes. You say t h a t th e Tr u st was s e t up on 29th March - ­ i f you j u s t look a t your st a t e m e n t t h e r e ? 22 A. 23 49 Q. 25 I t was th e same Trust? Trust. 18 24 No, I t h i n k t h a t was ...(INTERJECTION). Yes, t h a t i s r i g h t . "The Tr us t was s e t up on 2 9th March 1972 and funds appear to have been passe d to i t from two companies; namely, Winchester Investments Ltd. and Corowna L t d ." 26 27 Were t h e s e th e two companies t h a t were e s t a b l i s h e d 28 i n r e l a t i o n to th e proposed scheme t h a t Mr. Lowe had 29 proposed f o r C h a r te r House? 1 I am not so su re of t h a t . 2 correspondence was d e l i v e r e d . . . (INTERJECTION). 3 50 Q 4 A 5 51 Q I t h i n k t h a t the Yes, you can ta k e i t t h a t th e y a re , I t h in k ? I t h i n k th e y a r e , yes. Now, who a dvis e d you about th e e s t a b l i s h m e n t of t h i s 6 Tr us t t h a t was to be a d m i n i s t e r e d by "Ansbacher"? 7 Who a dv ise d you about i t ? 8 A 9 52 Q 10 A I t was more, I t h i n k , Don Reid. What about Mr. Traynor? Mr. Traynor came i n t o th e scene a b i t l a t e r than t h a t and a d m i n i s t e r e d th e arrangement. 11 12 53 Q 13 A He a d m i n i s t e r e d th e arrangement? Yes. I t h i n k t h a t s ta te m e nt I made here in 14 parag raph 4 i s not q u i t e c o r r e c t - - Mr. Traynor 15 "sug ge st ed t h a t th e proceeds r e f e r r e d t o above be 16 p la c e d in an o f f - s h o r e . . . 17 from, I t h i n k , Don Reid more than Des Traynor. 18 54 Q 19 A 20 55 Q " That s u g g e s ti o n was More than Mr. Traynor? Yes, I t h i n k so. Anyway, whoever a dv ise d about the s e t t i n g up of 21 t h e s e o f f - s h o r e T r u s t s , Mr. Traynor came i n t o the 22 p i c t u r e , did he not? 23 A 24 56 Q 25 A 26 27 T e l l us what he s a i d to you? I cannot remember, he was in th e background. I d i d n ' t meet Mr. Traynor a t t h a t p a r t i c u l a r s t a g e . 57 Q Had you not met him i n your j o i n t ve n tu re with Guinness & Mahon? 28 29 He did, yes. A I had met him, yes, but I d o n ' t t h i n k he was 10 1 in vo lv e d a t t h i s p a r t i c u l a r s t a g e . 2 58 Q 3 A 4 5 When he became inv olved, what did he t e l l you? I cannot r e c a l l th e c o n v e r s a t i o n I had with him a t th a t stage. 59 Q I want you to t e l l us what you remember about what you were t o l d th e arrangement was going t o be? 6 7 A 8 60 Q 9 Let me t h i n k about t h a t . Do you see th e l a s t para graph on t h a t f i r s t page, E x h i b i t 1? 10 A 11 61 Q Yes . "My u n d e rs ta n d in g i s t h a t th e Tru st l e n t th e monies to a company c a l l e d Starling . . . " 12 13 14 15 Who t o l d you t h a t ? A 16 I am not too s u re , I want to be c a r e f u l . e i t h e r Don Reid or Mr. Traynor. 17 62 Q 18 A 19 63 Q I t was I t had t o be. You are not too sure? No, I am n ot. You were t o l d t h a t : "The company in t u r n h e ld an account in Guinness & Mahon . . . " 20 21 22 23 Do you remember t h a t ? A 24 Yes, I thought th e money was h e ld by Guinness & Mahon. 25 64 Q 26 A 27 65 Q In Dublin? 28 A In Dublin. 29 I t was going to be held by Guinness & Mahon? Yes . No, wait now. I un de rs too d t h a t the money would be in the Cayman I s l a n d s . 1 66 Q You say t h a t o r i g i n a l l y you un de rs too d th e money would be in th e Cayman I s l a n d s ? 2 3 A 4 67 Q C o rr e c t, yes. That was th e Cayman T r u st , yes. You say, E x h i b it 1: 5 "I became aware of t h i s f a c t i n the la t e 1980's." 6 7 A 8 68 Q 9 A That i s r i g h t , t h a t i t was h e ld i n Dublin. In Dublin? C o rr e c t, yes. I always un de rs too d t h a t th e money 10 would be t r a n s f e r r e d to th e Cayman I s l a n d s . 11 o t h e r words, I d i d n ' t un d e rs ta n d very c l e a r l y what 12 was happening with t h a t accou nt. 13 experts. 14 69 Q 15 A 16 70 Q In I l e f t i t t the We w i l l look a t i t in g r e a t e r d e t a i l i n a moment. Right. "The monies r e f e r r e d to above were the only investment made by me i n t o the T r u s t . " E x h i b it 1. 17 18 19 You d i d n ' t t r a n s f e r anyt hin g f u r t h e r i n t o th e Tru st? 20 A 21 71 Q 22 No. Now, i f we t u r n th e page, you say: "Whitethorne No. 6 Tr us t i s a D i s c r e t i o n a r y Tr u st . . . " 23 24 25 Have you got a copy of th e Tr ust Deed? A 26 27 I think i t was he ld by Guinness & Mahon, I t h i n k . 72 Q 28 29 I d o n ' t have a copy of th e Tr us t Deed, no. We know t h a t your s o l i c i t o r wrote f o r a copy of the Tr us t Deed. A I wonder, d id he ge t i t , do you know? 1 73 Q. 2 A. 3 74 Q. You h a v e n ' t got i t ? No, I h a v e n ' t got i t . I ta ke i t you have no o b j e c t i o n t o w r i t i n g them f o r 4 the Tr ust Deed. 5 Deed, Mr. Crampton. 6 A. 7 75 Q. We would r e q u i r e t o see th e Tru st I have no o b j e c t i o n t o t h a t , no. We w i l l r e q u i r e a l l th e documentation i n r e l a t i o n to th e e s t a b l i s h m e n t of th e T r u s t . 8 9 A. 10 76 Q. Yes. Why I am s l i g h t l y s u r p r i s e d i s t h a t th e documents 11 you s e n t us show a l e t t e r from your s o l i c i t o r asking 12 f o r t h e s e documents and th e y do not seem t o have 13 given them. 14 A. We have asked f o r t h a t and i t has not been given. 15 16 That i s r i g h t . 77 Q. Were you t o l d t h a t you were not going t o be the 17 S e t t l o r of th e T r u st , though in f a c t you were 18 s e t t l i n g th e money on th e Tr ust? 19 somebody e l s e was going to be the S e t t l o r ? 20 A. 21 78 Q. 22 A. 23 Were you t o l d t h a t Yes, t h e r e were somebody . . . (INTERJECTION). What were t o l d about t h a t ? Well, I was t o l d i t was a T r u s t, t h a t t h e r e would be a Settlor. 24 79 Q. 25 A. 26 80 Q. Were you t o l d why you would not be th e S e t t l o r ? No, I w a s n ' t t o l d why. Did i t not occur to you a b i t s t r a n g e t h a t you were 27 s e t t l i n g money in t h i s T r u s t, i t was going to be a 28 D i s c r e t i o n a r y Tr us t and you were not t o be the 29 S e t t l o r named in i t ? 1 A. Yes, I q u e ri e d t h a t , I t h i n k , a t th e time and they 2 s a i d , no, t h i s i s the way i t i s done, th e way i t 3 should be done. 4 81 Q. 5 You q u e ri e d i t and they s a i d t h a t i s th e way i t . . . (INTERJECTION). 6 A. 7 82 Q. 8 A. 9 83 Q. 10 A. 11 84 Q. I t should be done, yes. Did th e y t e l l you why i t was to be done t h a t way? No, I d i d n ' t ask why. You d i d n ' t ask? No. You see, you say: "I si gned th e Tr us t Document a t the time but I do not have a copy of i t . . . " E x h i b it 1. 12 13 14 15 A. 16 85 Q. 17 But I wonder i s i t c o r r e c t , i f i t was a Tru st and th e S e t t l o r was Mr. H a rr is ? 18 A. 19 86 Q. 20 A. 21 87 Q. 22 C o rr e c t, yes. Can t h i s be c o r r e c t ? I beg your pardon? Can i t be c o r r e c t t h a t you s ign ed a Tr ust Document when you were not the S e t t l o r ? 23 A. 24 88 Q. 25 26 Yes, t h a t i s c o r r e c t . I cannot r e c a l l t h a t . Then you cannot r e c a l l th e L e t t e r of Wishes as to how th e T r u s te e s were to di s p o se of th e Trust? A. 27 I t h i n k t h a t was in th e T r u s t, the people who would b e n e f i t from th e T r u s t . 28 89 Q. 29 A. That i s i n th e T r u s t. You cannot r e c a l l i f you s ign ed a L e t t e r of Wishes? No, I cannot r e c a l l s ig n in g a L e t t e r of Wishes. I 1 was asked to si g n a L e t t e r of Wishes, but I cannot 2 r e c a l l doing t h a t . 3 90 Q. Now, Mr. Crampton, would you mind lo oking a t the 4 f i l e documents re S t a r l i n g S e c u r i t i e s Limited and 5 r e l a t e d correspondence (SAME HANDED TO 6 MR. CRAMPTON). 7 A. 8 91 Q. 9 Thank you. Would you j u s t look a t th e f i r s t document, " S t a r l i n g S e c u r i t i e s Limited", and i t give s th e ad dr e ss , 10 "Balance Sheet as a t 31st December 1974". 11 got t h a t , E x h i b it 2? 12 A. 13 92 Q. Have you Yes. Do you see th e a s s e t s of S t a r l i n g S e c u r i t i e s were 14 d e s c r i b e d as a number of s h a r e s i n a company c a l l e d 15 " S t a t e S e c u r i t i e s " , and then "A/O Fixed Deposit" and 16 "A/O-l Fixed Dep osi t" . 17 A. 18 93 Q. Do you see t h a t ? Yes. This document would have been given t o you by Mr. Traynor, was i t ? 19 20 A. 21 94 Q. 22 A. 23 95 Q. 24 A. 25 96 Q. C o r r e c t, yes. Did he t e l l you what "A/O Fixed Deposit" was? No. Did you ask him? I d id not ask, no. Why d i d n ' t you ask him? I s n ' t i t very s t r a n g e i t 26 does not i n d i c a t e where th e d e p o s i t i s ? 27 i n d i c a t e why i t would have th e code. 28 A. 29 97 Q. No, I l e f t t h a t to Mr. Traynor. So, you did not ask? I t does not 1 2 98 Q. 3 A. 4 You cannot remember asking? I d o n ' t , no. I d i d n ' t ask, I j u s t a c c e pt ed the f i g u r e s he gave me. 5 99 Q. 6 A. 7 100 Q. 8 A. 9 101 Q. 10 A. 11 102 Q. 12 A. 13 103 Q. I t i s not th e f i g u r e s , i t i s where th e d e p o s i t was. No, I d i d n ' t ask, no. You thought i t s t r a n g e , di d you not? I assumed i t was in th e Cayman I s l a n d s . Why would i t be in a coded l e t t e r l i k e t h a t ? I d o n ' t know. And you d i d n ' t ask? I never asked, no. These documents t h a t you produced f o r us y e s te r d a y , 14 I would l i k e you to look a t th e document, i t i s 15 towards th e end. 16 s ta te m e nt re th e Whitethorne No. 6 T r u st , E x h i b it 3. 17 I t i s t h i s document here (INDICATING). 18 document which you had in your p o s s e s s i o n . 19 1972 t o 1973. 20 i t a t home, did you, Mr. Crampton? 21 A. 22 104 Q. 23 A. 24 105 Q. 25 A. 26 106 Q. 27 I t h i n k i t i s document No. 11, a That i s a I t is I t i s an ol d note document, you had I did? That document (INDICATING) E x h i b it 4. I found t h a t on Fr iday of l a s t week. J u s t look a t i t . Yes. I t says " S t a r l i n g S e c u r i t i e s Limited Core Deposit, Guinness & Mahon Tr ust Li mited". 28 A. 29 107 Q. Yes. I s n ' t t h a t g u i t e c l e a r l y showing what th e money was 1 which was o b ta in e d by S t a r l i n g S e c u r i t i e s and i t i s 2 i n an account with Guinness & Mahon? 3 C orrect. 4 108 Q You see th e note t h e r e unde rnea th, "Interest rate 5 based on Dublin Money Market Rates and a p p l i e d a t 6 quarterly in terv als". 7 t o why th e Dublin Money Market Rate was being used 8 f o r your i n t e r e s t ? 9 A 10 109 Q 11 A 12 110 Q 13 Did you ask any q u e s t i o n s as No, I di d not query t h a t . You d id not query t h a t ? I do not remember querying t h a t , no. Well, the n, i f we j u s t come back t o your st a t e m e n t, E x h i b i t 1, on th e bottom of th e f i r s t page: 14 "The Company in t u r n h e ld an account in Guinness & Mahon Bank in Dublin, and I u n de rs ta nd t h a t t h e s e monies t o g e t h e r with o t h e r monies were d e p o s i t e d in Dublin. I became aware of t h i s f a c t in th e l a t e 1 9 8 0 ' s . " 15 16 17 18 So, your r e c o l l e c t i o n i s t h a t you knew no thi ng about 19 th e money be ing in Dublin u n t i l th e l a t e 1980' s ? 20 A 21 I thought th e money was i n th e Cayman Islands. 22 111 Q 23 A 24 What were you t o l d in th e l a t e 1980' s ? Well, I r e a l i s e d then t h a t some of th e money was h e ld i n Dublin. 25 112 Q 26 A 27 113 Q Why? I cannot remember. What caused you to r e a l i s e t h a t th e monies were he ld in Dublin? 28 29 That i s r i g h t , A I t h i n k i t was a c o n v e r s a t i o n I had with 1 2 114 Q. 3 A. 4 115 Q. 6 A. 7 Did he t e l l you t h a t i t was in a coded account? No. I d i d n ' t know anything about a coded account a t th a t stage. 116 Q. 9 10 He i n d i c a t e d a t t h a t s ta g e t h a t th e money was in Dublin, not in th e Cayman I s l a n d s . 5 8 What d id he t e l l you? Even though you got r e g u l a r s t a t e m e n ts showing the code? A. I d i d n ' t know what t h a t meant. I d i d n ' t know t h a t was a code. 11 12 117 Q. 13 A. 14 118 Q. 15 A. 16 Did you not? No, I d i d n ' t know. You never asked any q u e s t i o n s about i t ? I d i d n ' t ask any q u e s t i o n s about i t . I acce pte d what he was doing being c o r r e c t . 17 119 Q. 18 A. What d id he t e l l you in th e l a t e 1980' s ? In, 1989 I approached him and I asked him a 19 q u e s t i o n , would I have problems with t h i s account, 20 because I s a i d 'you see, I was in my 65th y e a r ' 21 . . . (INTERJECTION). 22 120 Q. 23 A. 24 25 That what? I was i n my 65th year, and i f t h e r e was any problem . . . (INTERJECTION). 121 Q. What s o r t of problems could t h e r e have been, di d you know? 26 27 A. 28 122 Q. 29 A. I was asking him were t h e r e any problems. What s o r t of problems could t h e r e have been? I t h i n k th e problems could have been i f th e m a t t e r 1 2 123 Q 3 A 4 124 Q 5 A 6 125 Q 7 A You mean t a x problems? Tax problems, yes. That i s what you were concerned about? That i s what I was concerned about. What d id he t e l l you? He s a i d e v e r y t h i n g was in o r d e r . I asked him on 8 t h a t occa si on, t h a t was in 1989, should th e m a t t e r 9 be r e g u l a t e d and t a x p a id , and a t t h a t s ta g e he s a i d "no" . 10 11 126 Q 12 A Why d id you r a i s e t h i s with him? Because I was a b i t wo rri ed t h a t t h e r e could be a pro ble m. 13 14 127 Q 15 A 16 128 Q 17 A 18 129 Q 19 A 20 130 Q 21 Had you d i s c u s s e d t h i s with your own acc oun tant? No, no. Did your own a cc oun tant know of t h i s arrangement? No. He d id not? No. I can ta k e i t t h a t t h e r e was no q u e s t i o n of having p a i d any t a x on any of t h i s money? 22 A 23 131 Q 24 A 25 132 Q 26 A 27 T h a t ' s r i g h t , yes. You s t a r t e d to ge t worried? I was wo rri ed a t t h a t s t a g e , yes. What caused you to be wo rried, Mr. Crampton? I f e l t , lookin g back, t h a t t a x should have been paid. 28 133 Q 29 A You f e l t i t ? 1 134 Q 2 A I did, yes. I s a i d say should we d e c l a r e t h i s and 3 pay t a x and he s a i d "no", a t t h a t s t a g e . 4 in 1989. 5 approached him again and . . . (INTERJECTION). 6 135 Q 7 A 8 136 Q 9 A 10 137 Q 11 A 12 138 Q 13 A 14 139 Q 15 16 A What d id he say? He s a i d th e same, t h a t t h e r e was no need t o . No need to do i t ? Yes . Why were you worried? At t h a t s t a g e , th e man was not w e ll. Mr. Traynor? He was ...(INTERJECTION). You d id not c o n s i d e r i t p rud en t t o have a word with No, because I t r u s t e d Mr. Traynor, being th e e x p e r t t h a t he was. 140 Q 19 20 Subsequent to t h a t , duri ng th e amnesty, I your own a cc ou nt a nt about t h i s ? 17 18 That was What caused you to t h i n k t h a t t a x should have been p a i d on i t ? A 21 Well, I f e l t a t th e s ta g e t h a t i t was not q u i t e right. Why? 22 141 Q 23 A 24 142 Q But why was i t not q u i t e r i g h t , i n your view? 25 A Because I t h i n k t h a t t h e r e was i n t e r e s t being 26 Because I thought the t a x should have been pa id . accumulated t h e r e and th e t a x was not being p a i d . 27 143 Q 28 A 29 144 Q Where was th e i n t e r e s t being accumulated? In th e Cayman. 1 2 145 Q 3 A 4 146 Q 5 A 147 Q Yes. I thought th e money was being accumulated in You thought t h a t be ing accumulated i n th e Cayman you should pay t a x on i t ? 8 9 There was money in Dublin? the Cayman. 6 7 No, I s a i d t h e r e was some money i n Dublin. A No m a t t e r where i t was being accumulated, I thought 10 t a x should be p a id a t t h a t s t a g e . 11 1980 ' s . 12 148 Q 13 That was in the Now, i f we j u s t t u r n over th e page, Mr. Crampton, you say in th e t h i r d parag raph , E x h i b i t 1 14 "In the e a r l y years th e monies earned d e p o s i t i n t e r e s t and t h i s was r e f l e c t e d in the accounts of S t a r l i n g S e c u r i t i e s Ltd. " 15 16 17 I am j u s t s l i g h t l y c uri ou s about th e phra se " in the 18 e arly years". 19 time, did i t not? 20 A 21 149 Q 22 A 23 150 Q I t earned d e p o s i t i n t e r e s t th e whole Yes, i t did, yes. The whole time i t earned d e p o s i t i n t e r e s t ? Yes . You say " t h i s was r e f l e c t e d in the accounts of 24 S t a r l i n g S e c u r i t i e s L t d ." 25 accounts f o r us and t h e s e c l e a r l y show th e i n t e r e s t 26 being accumulated. 27 accounts? 28 29 A You have produced t h e s e Where di d you ge t t h e s e How di d you ge t t h e s e accounts? They were p o s t e d by Mr. Traynor. 1 2 152 Q 3 A 4 153 Q 5 6 A Well, I thought th e y were in S t e r l i n g , t o be q u i t e honest with you. 8 154 Q 9 A 10 155 Q Sterling? I thought th e y were i n S t e r l i n g , yes. I see. Well, maybe I am wrong. No, s o r r y , th e y are i n pounds S t e r l i n g . 11 12 A 13 156 Q 14 Yes . Did t h a t cause you any s u r p r i s e , t h a t t h e y were in pounds S t e r l i n g ? A 16 17 Did you n o t i c e t h a t th e accounts were a l l i n I r i s h pounds ? 7 15 From Dublin. No, because I thought th e y were i n th e Cayman Islands. 157 Q 18 Now, i f we j u s t co nti nu e through your s ta t e m e n t. You s a i d in r e l a t i o n to th e i n t e r e s t : 19 "The r a t e v a r i e d from time to time. However, I had no r o l e whatsoever in de te rm in in g what t h a t r a t e a c t u a l l y was . " 20 21 22 Did you t a l k to Mr. Traynor a t a l l about th e r a t e 23 you were g e t t i n g ? 24 A 25 I t r e a l i s e d i t was high a t tim es . 26 158 Q 27 A 28 159 Q 29 A 30 160 Q 31 No, I never mentioned i t . The money was h e ld on d e p o s i t , was i t not? Yes . That i s what i s shown on th e accounts? Yes . You had been t o l d in th e document t h a t I i n d i c a t e d t o you a moment ago t h a t th e r a t e of i n t e r e s t was 1 Yes . 2 3 161 Q 4 A Was t h a t your und e rs ta ndin g? No, I unde rs too d th e money was d e p o s i t e d i n the 5 Cayman I s l a n d s and the i n t e r e s t was th e i n t e r e s t on 6 Sterling. 7 162 Q Very w e ll . Now, l e t ' s come to the next paragraph 8 th e n , "Withdrawals". 9 money you te le pho ne d Mr. Traynor? 10 A 11 163 Q 12 A 13 164 Q 14 I n v a r i a b l y , yes. You arra ng ed then f o r a sum to be withdrawn? C orrect. I t would "be c o l l e c t e d e i t h e r from Guinness & Mahon Bank or from th e o f f i c e s of 42 F i t z w i l l i a m Place"? 15 A 16 165 Q 17 A Sometimes. 18 16 6 Q Sometimes ? 19 A 20 167 Q 21 22 Yes . Used you go p e r s o n a l l y and c o l l e c t th e money? Yes, not always. You would send your s e c r e t a r y or somebody t o c o l l e c t it? A 23 24 When you wished t o withdraw No, no, i t was u s u a l l y c o l l e c t e d by whoever was going to use th e money. 168 Q 25 I f you were g iv in g money to somebody, t h a t donee would go? 26 A 27 169 Q 28 A 29 170 Q Yes . Who d id you give th e money to? I t was e i t h e r my son or da u gh te r. They would c o l l e c t the money from Mr. Traynor? 1 2 171 Q 3 A 4 172 Q 5 A 6 173 Q 7 A 8 174 Q 9 I t was pr obab ly given in cash. Cash? Yes, or a bank d r a f t . Or a bank d r a f t ? Yes. There w e r e n ' t big amounts. What about y o u r s e l f , when you drew i t y o u r s e l f , did you go to Mr. Traynor and ge t i t y o u r s e l f ? 10 A 11 175 Q 12 A Yes. That happened only about four ti m e s . What sums di d you c o l l e c t ? I t would be small amounts, £2,000 would be the maximum. 13 14 176 Q 15 A 16 177 Q Would i t have been cash then? Yes . You got t h i s from him in e i t h e r Guinness & Mahon or, 17 when he had l e f t Guinness & Mahon and was i n Cement 18 Roadstone, you went t o Cement Roadstone and got i t 19 a t th e o f f i c e in Roadstone? 20 A 21 178 Q C orrect. You say t h a t you " r e q u e s te d monies t o be s en t to my 22 da ug ht er in Sw it z e rl a n d and t h i s was arra nged by 23 Mr. Traynor"? 24 A 25 179 Q 26 A 27 28 29 He did, yes. Do you know how t h i s was done? That might have been done on a bank d r a f t , I am not too s ure . 180 Q You t h i n k t h e r e were not many wit hdr aw al s, you l e f t th e money . . . (INTERJECTION). 1 2 181 Q 3 This i s th e note t h a t we have been given and they were th e only withdrawals? 4 A 5 182 Q That i s i t , yes. I f we j u s t t u r n over to th e pa ragra ph on th e next page on " In v est m en ts ": 6 7 "There were two s i g n i f i c a n t inve stmen ts made by th e Tr ust vi a S t a r l i n g S e c u r i t i e s Ltd. The f i r s t was the purchase of a house in Spain . . . " 8 9 10 A 11 183 Q 12 A Yes . Would you t e l l us how t h a t came about? Yes. I cannot remember th e d a te , but I i n d i c a t e d 13 t h e r e might be a purchase investment i n Spain and 14 t h a t t h e r e was a company s e t up t o do t h a t . 15 184 Q 16 A 17 I t was an investment? An in ve st ment, yes. I t was a house we used. 18 185 Q 19 A 20 186 Q 21 A 22 187 Q For th e family? 23 A For th e family. 24 188 Q 25 26 Well, a p r o p e r t y , yes. I t was a h o l i d a y home, was i t ? Yes, t h a t i s c o r r e c t . Did you l e t i t out or ...(INTERJECTION). No, i t was j u s t used ...(INTERJECTION). What about th e Cork Investments In c o r p o r a te d ? What was t h a t ? A 27 Cork Investments was a company s e t up t o do j o i n t ve n tu re development i n A t l a n t a . 28 189 Q 29 A Who s e t i t up? Guinness & Mahon. 1 190 Q 2 A Who was th e j o i n t ve n tu re with, Cramptons? No, "Cork Inv estments" was th e company and i t was 3 s e t up to work with an American de vel op e r c a l l e d 4 . . . (INTERJECTION). 5 191 Q Was t h i s , as f a r as you were concerned, a j o i n t ve n tu re by "Guinness & Mahon" . . . (INTERJECTION). 6 7 A 8 192 Q 9 A Yes, "Cramptons". 10 193 Q "Cramptons" were? 11 A No, "Guinness & Mahon" were not inv ol ve d. Were you involved? Well, th e Tr ust was invo lve d. Mr. Frank McGowan was 12 th e de vel oper in A t l a n t a and we d id a few j o i n t 13 v e n tu r e s with him. 14 194 Q 15 A 16 195 Q 17 Who was he? "Cork In ve s tm en ts " . Yes, but when you say "we", was t h i s th e company c a l l e d "Cork Investments"? 18 A 19 196 Q Yes . I t was s e t up to do a j o i n t ve n tu re with Mr. McGowan? 20 21 A 22 197 Q 23 A 24 198 Q 25 C o r r e c t, yes. This was th e Tr us t company? C orrect. The Tr ust used th e money t h a t you had pro vid ed f o r th e purpose? 26 A 27 199 Q Yes, e x a c t l y . That company i s wound up now. Yes, I w i l l come to t h a t in th e moment. Now, you 28 de al then with th e q u e r i e s t h a t were r a i s e d in 29 Appendix C of th e l e t t e r t h a t we s e n t you (SAME 1 Yes . 2 3 200 Q I want you to t u r n over th e page t o th e paragraph 4 numbered 4 - - do you see t h a t in your st a t e m e n t, 5 parag raph number 4? 6 A 7 201 Q Yes . Now, would you look a t pa ragra ph number 4 i n the 8 appendix to which your pa ra grap h i s a r e p ly ? 9 you got t h a t ? 10 A 11 202 Q 12 13 14 15 16 Have Yes . It says: "Guinness and Mahon (I re l a n d ) Ltd. pro vid ed loan and gu a ra nt ee f a c i l i t i e s t o I r i s h r e s i d e n t s or to bodies c o r p o r a t e which they c o n t r o l l e d or in which th e y had an i n t e r e s t s ec ure d by cash d e p o s i t s with th e Company. I t appears to have been an impor tan t f e a t u r e of t h i s s e r v i c e t h a t t h i s s e c u r i t y was not r e f e r r e d to i n the loa n agreement. 17 18 19 20 21 I f you a v a i l e d of t h i s s e r v i c e give the d a t e / d a t e s on which you did so, the name and a d dr e ss of th e body c o r p o r a t e or bodies c o r p o r a t e to whom the loan was gra n te d , th e name and ad dre ss of th e i n s t i t u t i o n which g r a n t e d th e loan and f u r n i s h copies of a l l correspondence r e l a t i n g to the t r a n s a c t i o n ." 22 23 What you say in answer to t h a t i s : E x h i b i t 1 24 "I am aware of one i n s t a n c e in January 1977, or t h e r e a b o u t s , when a f a c i l i t y was g r a n te d to me in th e sum of £50,000 f o r the purch ase of a r e s i d e n t i a l premi ses . The correspondence r e l a t i n g t o t h i s have, I b e l i e v e , been s u p p l i e d t o you by my s o l i c i t o r . " 25 26 27 28 29 T e l l us what you know about t h a t , what you r e c a l l 1 2 A. 3 Yes, t h e r e was a loan of £50,000 and which I purchased th e p r o p e r t y in Dublin. 4 203 Q. 5 A. 6 204 Q. 7 A. 8 205 Q. 9 A r e s id e n c e ? C o r r e c t. You got a loan from Guinness & Mahon? Yes, t h a t i s c o r r e c t . We have a document, I w i l l r e f e r t o i t i n a moment, of 6th January 1977. Is t h a t what you are r e f e r r i n g t o , E x h i b it 1? 10 11 A. 12 206 Q. That i s r i g h t , yes. That i s i t . T e l l us what you r e c a l l about the s e c u r i t y given of 13 t h i s cash d e p o s i t . 14 arrangement and how did i t come about? 15 A. 16 17 I asked Guinness & Mahon f o r a loan of £50,000 and th e y gave me th e c o n d i t i o n s of t h a t , which I agreed. 207 Q. 18 I am asking you about th e f a c t t h a t th e loan was backed by a d e p o s i t ? 19 A. 20 208 Q. 21 A. 22 209 Q. 23 Yes. Can you t e l l us about what th e arrangement was? I am not too su re what th e arrangement was. You see, th e answer you have given, "I am aware of one i n s t a n c e in January 1977"; i s t h a t c o r r e c t ? 24 A. 25 210 Q. That i s th e i n s t a n c e we a re t a l k i n g about, yes. T e l l us what th e arrangement was with Guinness & Mahon? 26 27 What do you r e c a l l was the A. I unde rs too d th e arrangement was t h a t I got th e loan 28 and the i n t e r e s t was - - I am not too sure now. 29 me t h i n k about t h i s because I am a b i t hazy on t h i s Let 1 one, I want to ge t i t r i g h t . 2 of 50,000, which th e y gave me a l e t t e r t o t h a t 3 e f f e c t , and I t h i n k I und ers too d th e n t h a t i t was 4 covered by th e money in th e Cayman I s l a n d s . 5 a b a c k - t o - b a c k arrangement. 6 211 Q 7 I asked about a loan I t was You knew a l l about b a c k - t o - b a c k arrangements, d i d n ' t you? 8 A 9 212 Q No, I d i d n ' t ...(INTERJECTION). There i s a memorandum which your a cc o u n ta n ts wrote 10 to you e x p l a i n i n g about b a c k - to - b a c k arrangements 11 and t h e r e i s a memorandum, which I want t o r e f e r to 12 you i n a moment, about th e b a c k - to -b a c k 13 arrangements. 14 Guinness & Mahon, in t h i s case, would have a d e p o s i t 15 i n t h e i r bank, which was owned by Ansbacher, and i t 16 would be used f o r a s e c u r i t y f o r your loan? 17 A 18 213 Q 19 A 20 214 Q 21 A 22 215 Q 23 You knew what th e y were, t h a t Yes, f o r t h a t p a r t i c u l a r one. For t h a t p a r t i c u l a r one? That p a r t i c u l a r one, yes. Now, do you remember t h a t ? I remember t h a t , t h a t i s c o r r e c t . You must have n e g o t i a t e d t h a t with somebody. Was i t with Mr. Traynor? 24 A 25 216 Q 26 With Guinness & Mahon, yes. You n e g o t i a t e d t h a t t h e r e would be a b a c k - to -b a c k agreement in r e l a t i o n to t h a t ? 27 A 28 217 Q 29 A Yes, t h a t i s r i g h t . I think th a t is correct. You t h i n k t h a t i s c o r r e c t ? I t h i n k t h a t i s c o r r e c t , yes. 29 I t i s going back to 1 2 218 Q. I am j u s t wondering why you were ab le t o t e l l us in 3 your s ta te m e nt t h a t t h a t o c cu r re d. 4 that? 5 A. 6 219 Q. 7 A. 8 220 Q. 9 A. 10 221 Q. 11 A. I do, I r e c a l l t h a t . You r e c a l l t h a t ? I r e c a l l t h a t money, yes, I do, yes. You r e c a l l th e money? Yes. You r e c a l l t h e r e was a b a c k - to - b a c k arrangement? I t h i n k t h e r e was. I would have t o say, I t h i n k t h e r e was a b a c k - to - b a c k arrangement, yes. 12 13 Do you r e c a l l 222 Q. Did you make any e n q u i r i e s a f t e r we wrote t h i s 14 l e t t e r to you a ski ng f o r t h e s e p a r t i c u l a r s ? 15 make any e n q u i r i e s from anybody about t h i s ? 16 A. Well, no. Did you I d i s c u s s e d i t with my s o l i c i t o r and we 17 f e l t t h a t we had th e in f o r m a t io n t o answer your 18 questions. 19 223 Q. from anybody about t h i s ? 20 21 Yes, but I am wondering did you make any e n q u i r i e s A. 22 No. Anyone t h a t would have been aware of t h a t , i t would pr oba bly have been Des Traynor. 23 224 Q. 24 A. 25 225 Q. 26 A. 27 226 Q. 28 A. To th e b e s t of ...(INTERJECTION). 29 227 Q. To th e b e s t of your r e c o l l e c t i o n ? What about Mr. Colle ry? No, I had no c o n t a c t with Mr. C o l l e r y a t t h a t s t a g e . You d i d n ' t t a l k to him about t h i s ? No. I t was your own r e c o l l e c t i o n then? 1 2 3 Mr. Crampton, but the f a c i l i t y l e t t e r says t h a t the 4 funds were made a v a i l a b l e on a unsecured b a s i s . 5 you know t h a t ? 6 A 7 229 Q Yes, t h a t i s r i g h t . Do That i s th e same one. The f a c i l i t y l e t t e r i s i n c o r r e c t i f your re c o lle c tio n is correct? 8 9 A 10 230 Q That i s what w r i t t e n t h e r e ? 11 A That i s what i s t h e r e , yes. 12 231 Q Well, t h a t i s what ...(INTERJECTION). Would you j u s t look a t th e top of th e f a c i l i t y 13 l e t t e r , No. 2, th e amount, £50,000, I r i s h pounds, 14 E x h i b i t 6? 15 A 16 232 Q 17 A 18 233 Q 19 Yes . I t was in I r i s h pounds? Yes . Is t h a t th e only cash-backed loan t h a t you can recall? 20 A 21 234 Q That i s c o r r e c t , yes. You see, I must suggest to you, Mr. Crampton, t h a t 22 your r e c o l l e c t i o n i s a t f a u l t , t h a t we have a 23 document t h a t has been produced from th e bank which 24 s ug ges ts t h e r e was a ba lan ce due on a S t e r l i n g loan 25 of £61,227, on 31st December 1978, and i t was 26 d e s c r i b e d as " s u i t a b l y s e c u re d " . 27 which we have o b ta in e d from th e bank i s t h a t in 28 t h e i r re c o rd s any loan which i s s t a t e d t o be 29 " s u i t a b l y secured" means a loan which i s secure d on The i n fo r m a t io n 1 a back-to-back deposit. 2 i s a re c o r d of you owing, on a S t e r l i n g loan, money 3 which was due on 31st December 1978? 4 No. 5 235 Q 6 A 7 236 Q Can you e x p l a i n why t h e r e Did you have a S t e r l i n g loan? I cannot r e c a l l . No, I cannot r e c a l l t h a t . I would l i k e , Mr. Crampton, i f we could go through 8 b r i e f l y th e l a s t s e t of documents you gave us, which 9 we got y e s t e r d a y (SAME HANDED TO MR. CRAMPTON). 10 Yes, t h i s might be a good time to - - 11 now, Mr. Crampton, and you might l i k e t o look a t 12 t h e s e documents I want to go through with you. 13 w i l l bre ak f o r t e n or f i f t e e n minutes. 14 A we w i l l break We A ll r i g h t . 15 16 SHORT ADJOURNMENT 17 18 237 Q MR. JUSTICE COSTELLO: 19 Mr. Crampton, we w i l l co nti nue t h e n . Would you 20 look a t t h i s f i l e of documents t h a t you gave us 21 ye st e rd a y? 22 A 23 238 Q Yes . I t h i n k i t i s document No. 10 of 8th March 1972. 24 That i s from Kennedy Crowley t e l l i n g you how the 25 T r u s ts were going to be s e t up. 26 t h e r e were to be s i x T r u s ts s e t up, E x h i b i t 1? 27 A 28 239 Q 29 A Yes . Do you see t h a t 1 240 Q 2 A 3 241 Q 4 A 5 242 Q 6 A 7 243 Q Were t h e s e T r u s t s s e t up, do you know? That, I do not know. I do not know? No. You have not t a l k e d t o your fe ll o w D i r e c t o r s a t a l l about t h i s ? 8 9 A 10 244 Q 11 A 12 245 Q 13 A 14 246 Q 15 There i s only one a l i v e a t moment. Who i s t h a t ? Mr. O'Connor. Is t h a t Mr. Don O'Connor? C orrect. Is i t your r e c o l l e c t i o n t h a t you d id not t a l k to any of them a f t e r t h i s f i n a n c i a l arrangement was made? 16 A 17 247 Q 18 A 19 20 C orrect. I unde rs too d t h a t t h e r e were . . . (INTERJECTION). You unde rs too d t h a t th e y were a l l s e t up? Yes, but I could not confirm t h a t . I understood t h e r e were s i x t r u s t s . 248 Q Do you know whether any of them had Ansbacher 21 accounts such as you had or Guinness & Mahon 22 accounts such as you had in Dublin? 23 A 24 249 Q 25 A 26 250 Q 27 I am sure th e y had. You are su re th e y had? They pr obab ly had, yes. In o t h e r words, you t h i n k th e y c a r r i e d on th e same way as you c a r r i e d on? 28 A 29 251 Q They might, but not f o r as long. Not f o r as long? 1 2 252 Q 3 Well, we n e e d n ' t de lay, but th e next parag raph of t h i s l e t t e r says: 4 "As soon as th e T r u s ts a re drawn up I w i l l have th e L e t t e r s of Wishes si gned i n each case by Paul H a r r i s , who i s the S e t t l o r ." 5 6 7 The scheme was t h a t you were not t o si g n th e L e t t e r s 8 of Wishes, t h a t Paul H a r r i s was? 9 A 10 253 Q Yes, t h a t was th e i n t e n t i o n . Now, would you j u s t move on a couple of documents on 11 p a s t what we have been j u s t lookin g a t . 12 a l e t t e r of 10th March 1978, E x h i b it 8? 13 A 14 254 Q Do you see Yes . This i s your ha nd w rit in g, i s i t ? It is a h a n d w ri tt e n l e t t e r . 15 16 A 17 255 Q Yes . "I a u t h o r i s e you t o t r a n s f e r £20,000 from th e above account of which I am th e b e n e f i c i a l owner, th e account of J . D. T r a y n o r." 18 19 20 21 Can you remember now what t h a t was about? 22 A 23 256 Q 24 A 25 257 Q No. You cannot? No. This was to Mr. Furze in th e Cayman I s l a n d s and you 26 were i n d i c a t i n g to him t h a t you were th e b e n e f i c i a l 27 owner of th e £20,000? 28 A 29 258 Q Yes . 1 2 3 259 Q 4 Mr. Furze r e p l i e s then, t h a t he has made the n e c e s s a r y arrangements, E x h i b it 9? 5 A 6 260 Q Yes . Now, I want you to look a t t h i s f i l e t h a t you gave 7 us e a r l i e r . 8 and r e l a t e d correspondence (SAME HANDED TO 9 MR. CRAMPTON), and you see a t the very end of t h a t I t i s documents re S t a r l i n g S e c u r i t i e s f i l e t h e r e i s a han d w ri tt e n note , E x h i b i t 10? 10 11 A 12 261 Q 13 A 14 262 Q 15 A 16 263 Q 17 A 18 264 Q 19 Yes . That t h a t says "Cork Investments USA"? Yes . And cash in bank, e t c . Is t h a t your hand writing ? Yes . Would you j u s t t u r n over to th e l a s t page? Yes . You say: " I t i s proposed t h a t th e ownership of Cork should t r a n s f e r to I r e l a n d . The sug ges te d method i s t h a t Frank McGowan buys Cork from Cayman." 20 21 22 That i s you, i s i t , 23 A 24 265 Q 25 26 your i n i t i a l s ? Yes . And t h e r e i s a b a c k - to - b a c k loan arrangement to buy Cork from McGowan? A Yes . 27 So, you knew a l l about th e b a c k - to -b a c k 28 arrangements ? 29 1 267 Q. 2 A. 3 4 Do you know about what d a te was t h i s ? I would say i t i s pr obab ly about t e n ye a r s, I suppose, ago. 268 Q. I f you look a t th e document b e fo re t h a t , i t i s a 5 l e t t e r of 10th October 1994, from Ansbacher to 6 Morris Leonard of the I r i s h I n t e r c o n t i n e n t a l Bank. 7 Do you see t h a t l e t t e r , E x h i b it 11? 8 A. 9 269 Q. Yes. Mr. Furze i s t h e r e s u g g e s ti n g how " S t a r l i n g S e c u r i t i e s " would s e l l i t s s h are s? 10 11 A. 12 270 Q. 13 Yes. Does i t look as i f t h i s document t h a t you had h a n d w ri tt e n was w r i t t e n about the same time? 14 A. 15 271 Q. 16 Yes. I t was b e f o r e you had d i v e s t e d y o u r s e l f of the investment in Cork Investments Limited? 17 A. 18 272 Q. 19 A. 20 273 Q. Yes. How was t h a t , in f a c t , done? Excuse me, so rry ? How was, in f a c t , the d i v e s t i n g of th e inve stment of 21 the Tr ust in Cork Investments achieved? 22 was wound up in some way. 23 A. 24 How was i t done? I t had ceased t r a d i n g and th e money was s e n t back to . . . (INTERJECTION). 25 274 Q. 26 A. 27 275 Q. 28 A. 29 You say i t How was i t done? I t was done through the s o l i c i t o r s i n A t l a n t a . But t e l l me how i t was done? The s o l i c i t o r s were asked to wind up th e company, which was done l e g a l l y , th e ta x e s p a i d and th e money 1 t h a t was l e f t in th e bank was s e n t back t o the 2 Cayman I s l a n d s . 3 276 Q 4 A 5 What happened then? The money from th e Cayman I s l a n d s came back to D u b li n . 6 277 Q 7 A 8 278 Q 9 A 10 279 Q 11 A To what bank account? To Mr. Sheehan's bank account. But on your b e h a l f ? On my b e h a l f . You, p e r s o n a l l y , on Mr. George Crampton's b e h a lf ? Well, yes. I had o rg a n is e d t h a t t o be done, yes, 12 correct. 13 would be around — wel l, i t i s only wound up now, in 14 th e l a s t ye ar . 15 trad e. 16 280 Q 17 That would be c o r r e c t , th e time of t h a t Cork Investments have now ceased to The investment t h a t was under ta ken i n Cork Investments came back to you through th e T r u st . 18 A 19 281 Q I t came back through th e T r u s t, yes. That i s a l l th e q u e s t i o n s I want t o ask you, 20 Mr. Crampton, Ms. Mackey may wish t o ask a few 21 questions. 22 Yes . 23 24 END OF EXAMINATION OF MR. CRAMPTON BY MR. JUSTICE 25 COSTELLO 26 27 28 29 1 MS. MACKEY 2 3 4 282 Q. MS. MACKEY: I have j u s t a very few 5 q u e s t i o n s , Mr. Crampton. 6 F i r s t of a l l , i f you could j u s t give me one p i e c e of 7 i n f o r m a t io n in r e l a t i o n to th e o t h e r T r u s ts t h a t you 8 mentioned, of your fe llo w D i r e c t o r s . 9 th e D i r e c t o r s , except Mr. O'Connor, are now dead, I You s a i d a l l th in k ? 10 11 A. 12 283 Q. J u s t t o check t h a t . . . (INTERJECTION). I w i l l r e f e r you back to t h a t document. I t i s in 13 th e l a s t bundle t h a t you s e n t us i n y e s t e r d a y and i t 14 i s th e l e t t e r of 8th March 1972, from Don Reid, 15 E x h i b i t 7? 16 A. 17 284 Q. Mr. Clarke i s dead, Mr. East i s dead. What I was r e a l l y going to ask you, Mr. Crampton, i f 18 you could give me the f u l l name of each of th os e 19 Directors? 20 A. 21 285 Q. 22 A. 23 286 Q. 24 Mr. Samuel Clarke. Mr. East? James Sydney Eas t. Mr. O'Connor, you have a l r e a d y s a i d i s Mr. John 0 ' Connor? 25 A. 26 287 Q. 27 A. 28 288 Q. 29 Mr. Clarke? Yes. Mr. Seymour? Sydney Seymour, S.H. Seymour. Mr. Webb? 1 Thank you very much. 2 t o your st a t e m e n t t h a t you s e n t us in , i f you would 3 look a t th e second l a s t page of th e st a t e m e n t, 4 E x h i b i t 1? 5 A 6 290 Q 7 Now, i f I could j u s t r e f e r you Yes . Up a t th e very top t h e r e you say: "I note in th e accounts r e f e r e n c e s to College T r u s te e s Ltd. I was not p a r t i c u l a r l y aware of th e f u n c t i o n of t h a t Company but I now know t h a t i t had a management r o l e in r e l a t i o n t o the premises in Sp a in ." 8 9 10 11 A 12 291 Q Yes . When d id you become aware t h a t i t had a management 13 r o l e i n r e l a t i o n to t h a t ? 14 t o l d us t h a t you borrowed th e money for? 15 A 16 292 Q 17 18 Yes . When d id you become aware t h a t College T r ust e e s . . . (INTERJECTION). A 19 20 This i s th e premises you I t h i n k I knew e a r l y on t h a t i t was College Trustees. 293 Q What was i t s f u n c t i o n in r e l a t i o n t o t h a t . . . (INTERJECTION). 21 22 A I t managed th e a f f a i r s of th e p r o p e r t y . 23 294 Q I t managed th e a f f a i r s of th e p ro p e r ty ? 24 A 25 In o t h e r words, i t had to pay th e fe e s and expenses. 26 295 Q 27 A 28 296 Q 29 Yes. How d id t h a t come about? The Tr ust was s e t up through Guinness & Mahon. The Tr ust we have been t a l k i n g about a l l th e time, th e Whitethorne Trust? 1 2 297 Q 3 A 4 298 Q 5 A There was a n o th er Tr ust f o r t h i s p r o p e r t y i n Spain? Yes . I was not c l e a r about t h a t . The manager of th e company was . . . (INTERJECTION). MR. SHEEHAN: 6 7 but I do not t h i n k t h a t i s a T r u s t. 8 9 I am s o r r y t o i n t e r j e c t , 299 Q MS. MACKEY: Do you wish t o speak to your s o l i c i t o r f o r a 10 11 moment? 12 MR. SHEEHAN: I beg your pardon, s o r r y . 13 MR. JUSTICE COSTELLO: Yes, you have a word with 14 your s o l i c i t o r . 15 A 16 300 Q 17 A 18 19 Oh, yes, "Marazul" was th e company. MS. MACKEY: Marazul was th e company? Yes, and i t managed the p r o p e r t y i n t h a t i t p a i d the fe e s and th e expenses and r a t e s . 301 Q "Marazul" managed i t or "College T r u s te e s " ? I am j u s t not c l e a r he re . 20 21 A 22 302 Q 23 A 24 303 Q 25 Marazul managed th e p r o p e r t y . What was th e f u n c t i o n of College T r u st e e s t h e r e ? I t h i n k t h a t th e y managed - - I am not a c t u a l l y s u re . Rig ht. Can you remember how College T r u st e e s came i n t o the p i c t u r e a t a l l or who in t r o d u c e d i t ? 26 A 27 304 Q 28 A 29 305 Q I t was in tr o d u c e d through Guinness & Mahon. To you? C orrect. By Mr. Traynor, was i t ? 1 2 306 Q 3 A 4 307 Q 5 6 In what way was i t in tr o d u c e d to you? I beg your pardon? What were t o l d about College T r u st e e s or how di d you get involved? A Well, I do not know. When s e t t i n g up Marazul, 7 College T r u s te e s I t h i n k s e t t h a t up. 8 way I read i t , 9 MS. MACKEY: That i s the and i t managed Marazul. I have no o t h e r q u e s t i o n s to ask Mr. Crampton. 10 11 END OF EXAMINATION OF MR. CRAMPTON BY MS. MACKEY 12 13 14 15 308 Q MR. ROWAN: Mr. Crampton, i n 1972, when you 16 s e t up th e Whitethorne T r u st , 17 you say in your s ta te me nt t h a t you took advice on 18 th e s e t t i n g up of the Tru st? 19 A 20 309 Q 21 You s a i d t h a t some of t h a t advice came from Mr. Reid of Kennedy Crowley? 22 A 23 310 Q 24 25 Yes . C o r r e c t, yes. In answer to a q u e s t i o n from Judge C o s t e l l o you s a i d t h a t you a l s o had o t h e r a d v i s o r s Craig Gardner? A No, Craig Gardner, not in t h i s r e g a r d . Craig 26 Gardner a dv ise d us on our b u s i n e s s , G&T Cramptons 27 accountants. 28 29 311 Q Craig Gardner a dv ise d on c o r p o r a t e m a t t e r s to do with the company? 1 2 312 Q 3 In terms of p e r s o n a l t a x a t i o n adv ice, who advise d you on t h a t ? 4 A 5 313 Q 6 A 7 314 Q 8 A 9 315 Q Craig Gardner. Craig Gardner a l s o advise d you on p e r s o n a l t a x a t i o n ? They d id a l l my t a x . They do a l l my t a x . You took ad vice when th e Tr ust was s e t up? C orrect. And a l l th e arrangements t h a t were n e c e s s a r i l y a s s o c i a t e d with t h a t ? 10 11 A 12 316 Q Yes . Did you sub se qu e ntly , e i t h e r two ye ars or f i v e ye ars 13 or a t any s t a g e l a t e r , di d you ta ke advice on the 14 s t r u c t u r e s which had been c r e a t e d allo win g f o r the 15 p a s s i n g of new l e g i s l a t i o n over th e years? 16 A 17 No, no. I depended on Guinness & Mahon t o keep t h a t i n ord e r. 18 317 Q 19 A You depended on Guinness & Mahon? On Guinness & Mahon, yes. I did not d i s c u s s i t with Craig Gardner a t a l l , no. 20 21 318 Q 22 A 23 319 Q 24 A 25 320 Q 26 You d id not d i s c u s s i t with Craig Gardner? No. You r e l i e d on Guinness & Mahon? Exactly. Was t h a t Guinness & Mahon or was t h a t someone in Guinness & Mahon? 27 A 28 321 Q 29 A Well, I suppose i t was somebody i n Guinness & Mahon. Who would t h a t have been? 1 322 Q 2 A 3 323 Q Yes . You a l s o s a i d in answer to an e a r l i e r q u e s t i o n t h a t 4 around 1989, and then ag ain I suppose i t was in 5 1992, when th e t a x amnesty was on th e go, t h a t you 6 were concerned t h a t some a s p e c t s of th e arrangement 7 may not be in accordance with the t a x l e g i s l a t i o n - ­ 8 t h a t i s not what you s a i d , but what you s a i d was you 9 were concerned about i t ? 10 A 11 324 Q 12 A 13 325 Q 14 A 15 326 Q 16 A 17 327 Q 18 19 I was, yes, c o r r e c t . And you asked Mr. Traynor about t h i s ? Yes . He gave you an as s ur a nc e t h a t t h i n g s were i n orde r? Yes . On two occas ion s? Yes, in c onn ect ion with i t , yes, and th e amnesty. That i n d i c a t e d t h a t you put a g r e a t de a l of t r u s t in Mr. Traynor? A I d id . In t h a t r e g a r d I did, yes. He was Managing 20 D i r e c t o r of Guinness & Mahon, he was Chairman of 21 Cement Roadstone and he was very h i g h l y r e s p e c t e d , 22 and I t h i n k i f he was g iv in g me advice he thought i t 23 was c o r r e c t . 24 what he was sayin g. 25 328 Q 26 But, I t r u s t e d him, You have s a i d to us t h a t you did not d i s c u s s t h i s a s p e c t of t h i n g s with your p e r s o n a l t a x a d v is o r s ? 27 A 28 329 Q 29 I am sure he was. No, I never, no. Was t h e r e a re aso n f o r keeping the two m a t t e r s separate? 1 Well, yes. 2 matter. 3 330 Q I acc e pt ed Mr. T r a y n o r 's advice on t h a t In h i n d s i g h t , prob ab ly, I should not have. In th e S t a r l i n g S e c u r i t i e s pa per s, i n around 1995, 4 t h e r e was a d iv id e nd p a id of £300,000. 5 th e word was "divide nd s p a i d " . 6 div id e nd s paid? 7 P r o f i t and Loss Account f o r th e year ended 30th 8 September 1995, th e second l i n e from th e bottom, 9 "divide nds £300,000" E x h i b it 12? 10 A 11 331 Q 12 A Yes. A c tu a ll y , To whom were th ose I f you could p o s s i b l y t u r n to the I d o n ' t know. You d o n ' t know? I d o n ' t know, no. I t i s some i n t e r n a l arrangement. 13 I d o n ' t know anyt hin g about t h a t , who i t was p a id 14 to. 15 but t h e r e i s no divi de nds r e c e i v e d , anyway, t h a t I 16 know. 17 332 Q I t was something w i t h i n S t a r l i n g S e c u r i t i e s , Some of th e papers which you have p r e s e n t e d us with 18 have come r e l a t i v e l y s h o r t l y ago and we have not had 19 time r e a l l y to look a t them perhaps as c a r e f u l l y as 20 we may have to do. 21 A 22 333 Q Yes . The Cork Investments d i s p o s a l , we were lookin g a t a 23 document, E x h i b it 10, a moment ago - - I am j u s t 24 t r y i n g to f i n d i t . 25 MR. JUSTICE COSTELLO: 26 27 28 29 I t i s th e very l a s t document. MR. ROWAN: (TO WITNESS) On th e l a s t page, which i s e n t i t l e d " S t r a t e g y " , i t says, somewhere in th e middle paragraph: 1 "Frank McGowan buys Cork from the Cayman Company. GCC and o t h e r s then use b a c k - t o - b a c k loan arrangement to buy Cork from F. McGowan." 2 3 4 5 Yes . 6 334 Q 7 A 8 335 Q 9 10 We have e s t a b l i s h e d t h a t t h i s was your memorandum? C orrect. Did you d e v is e t h e s e id e a s y o u r s e l f or was t h i s with help from someone e l s e ? A This was a s u g g e s ti o n , a su gg est ed method, and I 11 t h i n k i t was d i s c u s s e d with Des Traynor, but i t 12 never m a t e r i a l i s e d . 13 p r o f i t from "Cork" could be ta ken i n I r e l a n d and 14 d e c l a r e d in th e us ual way, but t h a t never 15 m aterialised. 16 developed a t t h a t s t a g e . 17 336 Q 18 A The ide a was t h a t th e manager's That was a s t r a t e g y t h a t never Why d id you not implement t h a t s t r a t e g y ? I cannot remember why I di d n o t. 19 happen. 20 t e r m i n a t e t h a t company comple tely. 21 happened. 22 337 Q 23 A 24 338 Q 25 26 I t ju st d id n 't I de cided then t h a t we should l i q u i d a t e or That i s what Cork Investments I n c o r p o r a t e d was wound up? I t was wound up, Cork Inv estm ents, yes. The a s s e t s would have been d i s t r i b u t e d . . . (INTERJECTION). A No, th e money went back i n t o th e bank and t h a t was 27 t r a n s f e r r e d back to th e Cayman I s l a n d s and r e t u r n e d 28 from th e Cayman i s l a n d s to Mr. Sheehan's account, 29 and th e n t h a t was d e c l a r e d to the Revenue. 1 Thank you, th o s e are th e only 2 q u e s t i o n s I have. 3 4 END OF EXAMINATION OF MR. CRAMPTON BY MR. ROWAN 5 6 MR. CRAMPTON WAS FURTHER EXAMINED, AS FOLLOWS, BY 7 MR. JUSTICE COSTELLO 8 9 339 Q MR. JUSTICE COSTELLO: I would j u s t l i k e to get something c l a r i f i e d , 10 11 Mr. Crampton. 12 funds in " S t a r l i n g S e c u r i t i e s " . 13 by Mr. Rowan to th e accounts f o r 1995, and they 14 showed r e t a i n e d p r o f i t brought forward of £375,000, 15 and d iv id e n d s , and you do not know any th in g about 16 th e d iv id e n d s , you say? 17 A 18 340 Q I t i s about th e p o s i t i o n about the You were r e f e r r e d No, I do n ot. I f you look a t th e accounts f o r 1996, E x h i b it 13, 19 t h e s e show t h a t t h e r e were r e t a i n e d p r o f i t s of only 20 £86,660. 21 A 22 341 Q 23 No. Can you e x p l a i n what has happened? Which one? I t w a s n ' t th e d iv id e nd had been p a id , do you not know what happened? 24 A 25 342 Q I d o n ' t know what t h a t r e f e r r e d t o . J u s t l e t me u n de rs ta nd your u n d e rs ta n d in g of the 26 position. 27 r e t a i n e d p r o f i t s of £375,000 in 1995, but what 28 happened to tho se ? 29 Securities ? I t looked as i f S t a r l i n g S e c u r i t i e s had Are th e y s t i l l i n S t a r l i n g 1 No, a l l th e money from t h a t i s back i n I r e l a n d now. 2 I t was brought back t o Mr. Sheehan's account. 3 343 Q 4 A 5 344 Q 6 A 7 8 To your s o l i c i t o r ? Yes . When d id t h a t happen? I t happened about two ye ars ago now. d ur in g 1998. 345 Q 9 In e f f e c t , you te r m i n a t e d th e Tr ust arrangement, did you, i n 1998? 10 A 11 346 Q 12 A Well, I got th e money . . . (INTERJECTION). You got th e money back? I got th e money back and put i t i n with the 13 solicitor. 14 p a i d up to now. 15 347 Q 16 A 17 348 Q 18 19 I t happened I t has been d e c l a r e d and t a x has been On th e money, s in c e i t s r e t u r n ? Since i t s r e t u r n , yes. But I t h i n k you t o l d us e a r l i e r t h a t no t a x had been p a i d on t h a t money? A C o r r e c t, no t a x had been p a i d on th e money b e fo re th at. 20 21 349 Q 22 A 23 350 Q Before t h a t ? Yes, t h a t i s c o r r e c t . Very w e ll, Mr. Crampton, thank you f o r your 24 assistance. 25 MR. SHEEHAN: 26 There are two m a t t e r s we would l i k e t o c l a r i f y . 27 MR. JUSTICE COSTELLO: Yes. 28 MR. SHEEHAN: (TO MR. CRAMPTON) Will I 29 1 2 3 here which I misunderstood 4 t o be the same documents t h a t I had f u r n i s h e d to 5 you. 6 Mespil Company Limited, which has a n o t a t i o n on one 7 document which says " s u i t a b l y s ec ur e d" , and i t was 8 an amount of £60,000. 9 r e c o l l e c t i o n whatever of t h i s and we had d i s c u s s e d 10 Mespil Company p r e v i o u s l y , which was a n o th er j o i n t 11 ve n tu re to develop two or t h r e e p r o p e r t i e s on Mespil 12 Road, which never went ahead and th e s i t e was 13 su bs e q u e n tl y so ld to I r i s h L i f e . 14 p e r i o d I t h i n k some ground r e n t s had been c o l l e c t e d 15 and t h a t i s what my u n d e rs ta n d in g was as t o the 16 r e f e r e n c e to th o s e documents t h e r e . 17 s t i l l has no r e c o l l e c t i o n about . . . (INTERJECTION). 18 A. They r e f e r to a loan to a company c a l l e d Mr. Crampton has no In th e i n t e r v e n i n g Mr. Crampton I t was in te n d e d to do a g i a n t development on t h a t 19 s i t e with a Mr. Kingston, t h a t was th e pro p o s a l and 20 i t was t a k i n g q u i t e awhile. 21 i n the p r o p e r t y market a t th e time and th e deal 22 never went through and e v e n t u a l l y th e p r o p e r t i e s 23 were so ld to I r i s h Li fe who b u i l t an o f f i c e bloc k. 24 MR. JUSTICE COSTELLO: 25 26 There was a d e p r e s s io n Mr. Crampton, we have not got t h e s e documents. MR. SHEEHAN: No, and i t i s p a r t l y my 27 mi s ta k e. 28 tha n happy to make them a v a i l a b l e . 29 MR. JUSTICE COSTELLO: We w i l l be more We b e t t e r have them th e n. 1 I j u s t want t o u n de rs ta nd . 2 These documents i n d i c a t e t h a t Guinness & Mahon made 3 a loan to t h i s j o i n t ve n tu re company; i s t h a t r i g h t ? 4 They made an i n t e n t i o n to give a loan, yes. 5 351 Q 6 A 7 352 Q 8 A 9 353 Q A 12 13 No, th e loan was never ta ken up. I t was never taken up? Not t o my knowledge, never ta ken up. But you have got, have you n ot , t h i s documentation from Guinness & Mahon; i s t h a t r i g h t ? 10 11 They gave a loan, I t h in k ? 354 Q C o rr e c t, yes. MR. SHEEHAN: I t i s my mi s ta ke . MR. JUSTICE COSTELLO: That i s a l l r i g h t , 14 Mr. Sheehan. (TO WITNESS) 15 The documents i n d i c a t e , from th e Guinness & Mahon 16 r e c o r d s , t h a t th e loan which th e y gave was s u i t a b l y 17 secured ; i s t h a t r i g h t ? 18 A 19 355 Q That i s what t h a t document says, yes. That would i n d i c a t e t h a t i t was a cash-backed loan, backed by a d e p o s i t ? 20 21 A 22 356 Q I f i t happened? 23 A I f i t happened. 24 357 Q 25 But, whether i t happened or n o t, t h a t was the arrangement t h a t was to be e n t e r e d i n t o ? 26 A 27 358 Q 28 A 29 Yes, i f i t happened. Yes . Very w e l l . Yes . I t h i n k we b e t t e r have th e documents. S t e r l i n g loan? 1 Is t h a t 2 the same loan t h a t the judge was a ski ng about 3 earlier? 4 A. Yes. I t h i n k i t was never l i k e l y t o happen, because 5 we would pr oba bl y never have gone ahead with t h a t 6 development. 7 MS. MACKEY: I t wasn't a fe a s ib le proposition. Was t h a t loan t o be a S t e r l i n g loan? 8 9 A. I d o n ' t know. 10 MR. JUSTICE COSTELLO: What was th e d a te of i t ? 11 MR. SHEEHAN: This i s 1977. 12 MS. MACKEY: So i t i s not th e same. 13 MR. SHEEHAN: Well, i t may be. 14 There seems t o be a reducing 15 ba lan ce on i t , on the day of t h i s document - - I am 16 s o r r y , I have not r e f e r r e d i t to you - - i s 11th 17 October 1977. 18 ba lan ce £51,000. 19 MS. MACKEY: I t says amount £60,000, p r e s e n t he re , £61,000 S t e r l i n g 20 21 £61,000 i s th e amount MR. SHEEHAN: I t may not be th e same, but I w i l l f u r n i s h t h e s e 22 23 to you in t o t o . 24 be o t h e r documents with our ac c o u n ta n t, which I 25 wrote to th e accou nta nt and asked him t o send any 26 documents he had. 27 S t a r l i n g accounts , but I have something i n th e back 28 of my mind t h a t t e l l s me t h a t he has o t h e r documents 29 in r e l a t i o n to th e Spanish p r o p e r t y . The second t h i n g i s t h a t t h e r e may He s e n t me back cop ies of the I t only came 1 to me t h i s morning. 2 not b e l i e v e th e y w i l l add much to your knowledge, 3 but I w i l l c e r t a i n l y get them. 4 t h a t , too. 5 MS. MACKEY: I w i l l chase th o s e up. I do I a p o lo g is e f o r Which a cc ounta nt i s t h i s now? 6 7 MR. SHEEHAN: This i s Mr. Brian Bohan, who has been a d v is i n g 8 9 Mr. Crampton on t h i s s p e c i f i c m a t t e r . 10 MR. JUSTICE COSTELLO: On t h i s m a tt e r? 11 MR. SHEEHAN: This m a t t e r only, yes. 12 MR. JUSTICE COSTELLO: Then Mr. Bohan must have g o t t e n documents t h e n . 13 14 15 16 He must have o b ta in e d documents. A. He was given a l l th e documents, yes. MR. SHEEHAN: 17 U n f o r t u n a te ly , I d i d n ' t have them i n my o f f i c e . 18 seem to r e c a l l documents to do with th e Spanish 19 p r o p e r t y , which were l a r g e l y t i t l e 20 . . . (INTERJECTION). 21 MR. JUSTICE COSTELLO: 22 I I am not so concerned about t h o s e , but I am 23 concerned though about th e o r i g i n a l Tr us t Document 24 and the f i l e r e l a t i n g to th e o r i g i n a l T r u st , t h a t we 25 r e q u i r e you to w r i t e to Cayman to ge t t h i s . 26 could a l s o f i n d out from your s o l i c i t o r what 27 happened to th e r e q u e s t which he made i n 1998, about 28 t h e s e documents. 29 You 1 to w r i t e t o Mr. Don Reid 2 3 t o r e q u e s t him to make a v a i l a b l e t o us h i s o r i g i n a l 4 f i l e r e l a t i n g to th e e s t a b l i s h m e n t of t h i s Tru st and 5 a l l documents r e l a t i n g to i t . 6 A. 7 Yes MR. JUSTICE COSTELLO: t o w r i t e t o Mr. Lowe, as 8 9 w e ll, to produce f o r us th e documents which we need, the same documents. 10 11 We would a l s o r e q u i r e you A. Yes. MR. JUSTICE COSTELLO: 12 13 F i n a l l y , Mr. Crampton, i t is ju s t a formality, 14 but when th e t r a n s c r i p t i s completed i t w i l l be 15 given to you to s ig n. 16 t o see t h a t i t i s c o r r e c t and then si g n t h a t i t i s 17 c o r r e c t , th e t r a n s c r i p t of your evidence today. 18 19 20 A. You w i l l want t o re a d over i t Yes, r i g h t . MR. JUSTICE COSTELLO: Thank you, Mr. Crampton. Thank you, Mr. Sheehan. 21 22 23 24 25 26 27 28 29 END OF EXAMINATION OF MR. CRAMPTON o o o t - 'jq,Vt>T ' Q 5 S vW X X 'P Q ^ J ' 0 \/v^ W*) > # ................ ✓ Jf - ' ^ •«%..«...• ...........................a n ■iwiii nn . n . 'ii. tm g»i , v v w j « s s \ vrcTTrr g ^ GEORGE CRAMPTON RE: Response to request o f Inspectors appointed to Ansbacher (Cayman) Ltd by letter dated 21st December 1999. I am a Director o f the Construction Company G & T Crampton Ltd and have been since 1948. Certain o f the information in this Statement is based on my memory which I regret is unclear as to detail. Other information is based on facts which have come to light following recent investigations. In 1972 I had funds available to me (amount can be supplied if required) in connection with the former ACC Bank Building at the comer o f Hatch Street and Harcourt Street G & T Crampton Ltd had at that time a business association with Guinness & Mahon Bank in Dublin. Apart from normal banking arrangements it was involved in a joint venture company with the Bank to develop housing, generally in the Dublin Area. During the course o f these dealings I became acquainted with Des Traynor who was a Managing Director o f the Bank at that time. He suggested that the proceeds referred to above be placed in an off-shore trust based in the Cayman Islands. Don Reid o f Kennedy Crowley Accountants advised on the tax aspects o f the proposal. I understand that he in turn obtained an opinion from Raymond O’Neill S.C. in relation to the taxation aspects o f the proposal. I recall Noel Garland B.L. also gave advice. I believe a Solicitor involved at the time was John Darly o f Fred Sutton & Co Solicitors. On the advice given I jpas satisfied that the proposed structure was an acceptable tax avoidance scheme. The investment was duly made however 1 am unaware as to the particular financial details involved as these were handled by Des Traynor. The Trust was set up on the 29th March 1972 and funds appear to have been passed to it from two companies namely Winchester Investments Ltd and Corowna Ltd. I am not aware o f any details regarding these companies. The Trustee nominated to the Trust was Guinness & Mahon Cayman Trust Ltd. My understanding is that the Trust lent the monies to a company called Starling Securities Ltd which in turn held these funds on deposit in Ansbacher (Cayman) Ltd. (the Company). The Company in turn held an account in Guinness & Mahon Bank in Dublin, and I understand that these monies together with other monies were deposited in Dublin. I became aware o f this fact in the late 1980’s. The monies referred to above were the only investment made by me into the Trust. Whitethorn N o. 6 Trust is a discretionary trust and its beneficial objects are the issue o f my parents the late George James Crampton and Olive Elizabeth Crampton and other parties as set out in the letter dated 19th June 1998 from John James o f Cayman International Trust Company to my Solicitor. I signed the Trust Document at the tim e but I do not have a copy o f it now and I do not recall having had a copy o f it in my possession. M y memory is that D es Traynor made all the arrangements in this regard. My dealings with the Company were always through the late D es Traynor during his lifetim e and after his death with Padraig Collery. I do however recall having some dealings with a John Lipscombe in relation to the acquisition o f a property in Spain to which I w ill refer below. . In the early years the monies earned deposit interest and this was reflected in the accounts o f Starling Securities Ltd. These accounts were posted/delivered to m e by Des Traynor on an ««nnal basis and I signed them to confirm they were in order. This practice continued up to Mr. Traynor’s death and ceased thereafter. I believe the main activities in relation to these accounts fell into four categories 1. 2. 3. 4. Accrual o f Interest Withdrawals Payment o f fees Further investments. 1. A ccrual o f Interest The accounts o f Starling Securities Ltd disclosed increases in monies on call deposit. It was due to the accrual o f interest thereon. The rate varied from tim e to time however I had no role whatsoever in determining what that rate actually was. 2. W ithdraw als ^ I effected withdrawals by telephoning Mr. Traynor and requesting him to arrange payment o f a particular sum. This sum would then be collected either from Guinness & Mahon Bank or from die offices o f 42 Fitzwillliam Place, Dublin 2. Withdrawals would either take the form o f a Bank Draft or cash. On one occasion I requested monies to b e sent to m y daughter in Switzerland and this was arranged by Mr. Traynor and I note now that it occurred on or about the 27th January 1995. In general the withdrawals were made for the benefit o f my children however on one or two occasions m onies were withdrawn for my own personal benefit. In general there were very few withdrawals. 3. Fees The accounts disclose fee payments to various third parties. W hile I am not now familiar w ith the detail o f such fees I am satisfied that they were correct as I presumed they were approved / checked by Des Traynor. I did not nor was I in a position, to question the particular amounts. I note in the accounts references to C ollege Trustees Ltd. I was not particularly aware o f the function o f that Company but I now know that it a management role in relation to the premises in Spain. 4. Investm ents There were tw o significant investments made by the Trust via Starling Securities Ltd. The first was the purchase o f a house in Spain and the second was an investment in an American Company known as Cork Investments Lie. The U .S. investment occuiTed in or about 1985. This company has recently been liquidated in the US and the surplus funds have been repaid to me via the Trust The Spanish property was bought in the name o f Marazul Properties, a Panamanian company on the advice o f D es Traynor. It was he and I believe a John Lipscombe who made the arrangements in this regard. The monies to finance this purchase were transferred from the Starling Securities Account to Spain to finance this purchase. I refer now to Appendix C o f your letter dated the 21st Decem ber 1999 and the following are m y replies to the specific matters raised therein using the numbering system set out t Cavman Island Trusts and Trust Companies (1) a) b) c) d) . . Please see details set out above in response to this question In or about March 1972. There were no further additions to the best o f my recollection. I refer to the two investments set out above namely the purchase o f premises in Spain and the investment in the US Company. Apart from these there were payments made in favour o f family members and one or two payments in favour o f m yself. I do not recall the particular extent or details o f same other than those which havfc already been furnished by way o f cowespondence. e) I do not recall the name o f the settlor specifically but I think a Mr. Paul Harris was involved in som e way at the time. He may have been a trustee. Funds were transferred by D es Traynor and I have no idea how this was done. 0 I do not recall every signing a letter o f wishes. g) Oral instructions were given to either Des Traynor or Padraig Collery. I do not have any correspondence in this regard. The use o f deposits maintained bv Irish residents with the Company (2 ) a) D es Traynor c/o Guinness & Mahon Bank. I am not in possession o f any correspondence in this regard. b) There were no further sums deposit. c) There were no specific lodgments d) By way o f oral instruction to Des Traynor. Please see details set out above. e) Not to my knowledge f) I do not know. (3) 1 do not recall any involvement with Irish Intercontinental Bank. (4) 1 am aware o f one instance in January W 7 or thereabouts when a fw lity was granted to m e in fee sum o f £50,000 for the purchase o f a residential pronises. The correspondence relating to this have I believe been supplied to you b y my Solicitor. (5) These services w ere not applicable to me. (6) I am not aware. (7) I did not avail o f these services. a)} (i) Starling Securities Ltd, (ii) Marazul Properties, (in) Cork Investments Inc b) c) d) N one that I am aware None that I am aware Whitethorn N o. 6 Trust (9) N oted O J d a c / k a m / N b ijp * . gtPE.PT.TNG SECURITIES LIMITED Profit ana Loss Account 'Cron 1st January/ 1973 ----- - -ho 31st December. 1974 REVENUE: Interest receivable 12,286.61 less EXPENDITURE: 'r*' _ • ’ Incorporation Expenses ^50.00 # . ' Management Fees Government fees and Sundry Disbursements 817.25 70.35 1,137.60 ■ ______ li 11,149.01 r \ .s' fiTM«.TKS SECURITIES LIMITED . P.O. Box 887/ Grand Cayman, B. W. I. Balance Sheet as at 31st Bor.ember, 1974 & LIABILITIESsShare Capital Profit and Loss Account Loan Capital - Trustees of Whitethorns No. € Trust 5 0 .0 0 1 1 ,1 4 9 .0 1 107* li.9 .3 5 6 1 1 8 /3 1 8 .3 6 represented by: ASSETS 125 State Securities Limited shares of £1.00 fully paid "A/0" Fixed Deposit "A/0-1" Fixed Deposit: C u r r e n t A cco u n t 125.00 7/066.02 111/249.09 (121.75) ‘ WHITETHORNE NO. 6 TRUST Trustees: Guinness Mahon Cayman Trust Limited P.O. Box 887, Grand Cayman, B. W. I. , » *'• .4 - . ialance Sheet as at 31st December, 1974 LIABILITIES:Capital Account " _ 100.00 Profit to 31st December, 1974 57,074.35 Corowna Investments Ltd. - Loan Account 12.50 Winchester Investments Ltd. - Loan Account 50,000.00, & 107,186.85 represented by:J* ASSETS s— 25 Winchester Investments Ltd. Shares of CI$1.00 10 Sandpiper Holdings Ltd. Shares of CI$1.00 5.00 Starling Securities Ltd. Shares of CI$1.00 50.00 100 12.50 Interest free unsecured loan to Starling Securities Limited » 107,119.35 & 107,186.85 STABLING SECURITIES LTD. CALL DEPOSIT IN ACCOUNT WITH )A TE 3.4.72 7.7.72 .2.73 L.3.73 3.4.73 I.-*.73 .6.73 G U IN N E S S M A H O N DETAILS Lodged Lodged • Tfr. to B.N.S. Interest: 20/4/72 - 31/3/73 Lodged - Profit Share ex Sandpiper. Lodged - Share Capital Interest S.K.C. - Allocated Cost. Note:- C A Y M A N T R U S T LIM ITED DEBIT CREDIT 50,000.00 37,500.00 420.92 4,800.71 12,310.80 904.01 182.10 I BALANCE 50,000.00 87,500.00 87,079.08 91,879.79 104.190.59 105.094.60 104,912.50 Interest rate based on Dublin Money arket Rates a id applied at quarterly li tervals. Cur ent rate 8j% set 25.4.73 K < (i S/hy^u . r G rH V I BANKERS G U IN N E S S + M A H O N L T D 17 College Green Dublin 2 RQ Box 55A Telephone:782444 6th January 1977, Our Kef: PO'D/AC Ur. George-Crampton, G. & T. Crampton Limited, 158, Shelbourne Road, DUBLIN 4. Dear Sir, . Further to recent negotiations we write to confirm that we are prepared to wake a facility available to you subject to the following terms and conditions: * (1) Borrower: Mr. George Crampton. (2) Amount: £50,000.00 (Fifty Thousand Pounds)Irish fi. (3) Term: In accordance with normal banking practice all sums advanced are repayable on demand but in any case we shall review the Account on the 6th January 1979. (4) Drawdown: You may avail of the funds by way of overdraft* on a fluctuating basis as and when required. ' ' (5) Interest: We propose charging interest on the Loan at 14% per annum fixed. Interest will be debited to your Loan Account and become payable by you on the 31st March, 30th JUne, 30th September, 31st December annually and at maturity of the Loan, * . (6) Security: The funds are being made available on an unsecured basis. c • Continued... Ttksnmt: Mw*. Oubln. T «l» « 32CA Reglti.red Offlct: 17 Colaga Grttn, Dublin Z fagisurad Nun>b«: 10282. Ch*ltm*n: John H, Gidmwis. bteutbt Oiraciott: J. Oumond Tiiwnor lOtpuiy Muiriei fc. O’Krty. tMcutiv* Obtcton; H.W. Evtrln. A.P.B. Quinnus, J.E.A.B. Qulnnm, J .C Lov« Jnr., (XT. O'Connor, ta iiu n : Gtftld C.J. McOadttn. Cbntinuation Sheet No. 1 Mr. George Crampton (7) Liquidity Clause: If there s h a l l be any Increase In the cost to us of making or maintaining the Loan by an amount w hich we d e e m material resulting f r o m an y c h anges In the reserve or liquidity requirements to .which w e may b e subjected, then w e shall be entitled t o call for payment of a dditional Interest of such amount as w e shall certify as the amount required t o compensate for suoh increased cost with effect from the date of notification. You s h a l l . b e at liberty within one month after s u c h notification and without payment of any premium or penalty to repay the full amount of the facility outstanding together w i t h interest at the rate applying pr i or to notification. W e e n c l o s e herewith a copy of this facility letter for signature b y you' and return, thereby confirm i ng your acceptance of the f a c i l i t y on th e terms mentioned. • Tours f al t hf u l l y } for GUINNESS + M A H O N LIMITED. P. J. Flynn, Banking Manager. P. O ’ Dwyer, Loans Officer. Kennedy Crowley & Co. Chartered Accountants Hainault House 69/71 St. Stephen’s Green Dublin 2 Telephone 757971 G .C . Cram pton, E s q ., 9 , M aple Road, D u b lin 14. . Re; Kef: DR/GC Date: 8th M arch, 1972 Cayman T r u s t s . D e a r H r Crampton, I am s o r r y th a t I t lias talcen me ra th e r lo n g e r to come back to you w ith the d r a f t L e t t e r o f Wishes. I an now e n c lo s in g s ix copies o f t h is d r a f t so t h a t I t may be considered b y each o f the In d iv id u a ls concerned. I t h in k t h a t the terms o f the l e t t e r a re f a i r l y s e lf -e x p la n a to ry and sho uld n o t g iv e r is e to any problems b u t, should anyone w is h to d iscuss th e n w it h me I would be happy to do so. S in ce I saw you we have sent to the Cayman Is la n d s th e re v is e d d r a f t T r u s t Deed, to g e th e r w ith the d e t a il-) re q u ire d to complete the appointed c la s s I n each case. F o r ease o f re fe re n c e , and to avo id too much I d e n t i f i c a t i o n , we a re c a l l in g the T r u s t s the W hite th o rn T ru s ts , Your own w i l l be the W h ite th o rn A T r u s t , Mr C la rk 'is th e W hitethorn B T r u s t , Mr f a s t 's th e W h ite th o rn C T r u s t , Mr O 'C o n n o r's the W hiteth o rn D T r u s t , Mr Seymour's the W hite th o rn E T r u s t , and Mr Webb’ s the W hite th o rn F . T r u s t . • As soon as th e T r u s ts are drawn up I w i l l have the L e t t e r o f Wishes signed i n each case by Paul H a rr is who is th e s e t t l o r . Two form al steps w i l l then rem ain t o be taken. The f i r s t is th e fo rm a tio n by the Tru s te e s o f a company ( o r com panies) to re c e iv e income from d e p o s its o r Investm ents on b e h a lf o f the T r u s te e s . The second w i l l be the execu tion b y Paul H a r r is o f a Deed ( i n b la n k ) a s s ig n in g h is powers as A p p o in to r o f th e T r u s ts . IVii.np::! M .ii 'iii'n's ' I r . f l M '. 's r - v v l l ' . ‘ iWf.-iU <•!!»«. W \ C o ll. U -;-V \ nv.vti i- K‘.\ Nin’.i 1''-»wIca i'V\ V OVii,mi:r ,U‘ iVivt'l Ui'vm' MA Alt vSi-oil K .1 fcttU Kiil li .i t ;" h i tiiTilil! WluritT I'V\ '•'oiDB il ttill.• IV lr r I ,V I Amaixxv?am?ih) i . 7 . FEB.2000 ; NO.712 1 7 :2 9 n 9 /c b z s L JZe^SL * fo / / 4 t& fib r il /i/0 £ tf& s c A / f j p / £ u d /* fSfc, d)'Us / & . { tS u Z Z ttV C S )^ j j J^& o , 0o& /o &6 /u h v • yZ ,/) 'J y & ~ y . ^ s $ C l* * < S ^ P.ia.'19 GUINNESS MAHON CAYMAN TRUST LIMITED A M .m b .r of th e Q u in n ... M .hon M .rc h .n t Banking Group P.O. Box 88 7 Tl.tephon .N o 9 -4 8 5 3 /4 T .tax CP 3 0 5 Grand Cayman ' British W .st Indies C ab le A d d ress G uinness 13th March, 1978. our r.f JAF/AJW George C. Crampton, Esq., 9 Maple Boad, Clonskea, DUBLIN 1 4 . Be: WDTETHOBH Ko.6 THOST imd gTtnr.THf. SECTOITIEa U M H E D Dear Ur. Crampton, Many thanks lor yours of the 10th March. I have today made the necessary arrangements as requested by you. With kind regards, I 7' PNSBflCHER CflYMflN n ' » ! - C o e tc C flJJJ m U £ S r M £ H TS, /A / JB A / JK . P fW J & r y {0 I-}6 & P& O Y P S f lC * tT # £ £ A T tfic r ff H. £ # a / /& h d . . -fs s , 060 % Z j/& t)J T 6 J n t- fo e x & to n J # o u i£ v a & .b 0/ S » /l tU Z y. % pAtt)j otont P i 7 * ro p -6 f‘T y J /S J Z * (?) M i ^ o ttfA f0 fr s t ’’T'Xere /J /t/ /& CtU /*}' fisrtttA fa * A n lt 4$e 0 lfa K * C ( (J) f i l l ». C o& K e j jL fr p p r a n ................£ . - 1. J tU /< 4 /3 S t» o So% 9Y jf/^ tO O U •£&, fiU f &fye&* /L r /fi* / 'r Jh A ft* * f* r^f f Mo £ U- & /& / } qh& , $0 /* to * f y i *> / / n 'c p t f f 'j ■ P& & K ) Z t/j . * ohJ ¥ 2 5 ,0 0 * 3 lA « & < . y* / A e /c s fabSt* $ 2 0 0 ' 00 o ty s „ g jt, \ . £ * f* U Z /* K .j tb t/iifo * / 2 '£ % /t qiz> 4 e /o fs °1 j* Jv* //o Q uail, /? £ $ f /f* Y ^ &n Vt5 f> (tf{U .iJ < (4 ') [t \ }j /ft J ftS 6*1- I") fiyofltrfy . tn * * ’ *'* . /? » /£ ,„ dm s / t i f 'C / f f o / *J / L M e* p * i& 00 u /* * '« & * > . v s - o o n 'O O / M~ . '/ . S 't / * [ iv $ > Q 09 '- t n / tv f'V j ooa s f r * ot f o ^ jt - o»(7 ' ° J f f a / J? /? / • ’/ l ‘c ~ f / o e o 'a s tr 7 ‘ O V 0 / ^ **U > « • fy ? * /, t' s * v > /, * ... ^ T V * /. 1, 7 / /? / W % P* h l j # u / ' x M fc lf/ % . J / * r * fj /« ■ V ^ ’^ d , '" * 3 7 7*yw£~‘'%/ u i t ^ * > b £ j- ifiu / ?& #£? /& y/S< Y f/0 / J e y * / * i9J f $ l9 i* Y M 9 lf P # fr t -/^ /Y i i - -. - • O NUUAtD aaO bBSKIb ™T_ . . r r t .^1 r^-w. I U '" ^ vn.^^u'wu /}/* pres**./- fo e x /> £ ^ ( jr tlt^ ^ w i ,A < y /f /r CK>Aes A y O tty ti* # - ^ r y li/- ^ ^ • S i y t* / f* & j C U -o o d I ^ P 'rs> p t^ € M -J 7 L & u J */ C& X2v^< & 7 X a iQ & Y f£ ^ /> te ^ /- & m sy o io w r - r C c fi e j & £% . /> M fz s *)&€. ,/£ * ^ F re* ~ JC & /h f~ $**. < & #{ fr * * 1 £0 0 < £ eL yr* 4 U rs /i5 & » * /)£ . 4&eJ l Jy^~ - & & K * .•_"Vas. is s o ..^r i 1 nvMriuuN PNSBPCHER CffitlfiN ANSBACHER (CAYMAN) LIMITED PO BOX 887 H enry A n s b a c h e r GRAND CAYMAN j? / ^ J W CAYMANISLANDS BRrnsn WEST INDIES Telephone 809 949 S6S5 Jaorimile 809 949 7946 Tata GF 4305 ViaFacsimile #011-3531-6785-034 This page only 10 October, 1994 JAFnm Morris Leonard, Bra. Irish Intercontinental Bank 91 Merrion Square ’ Dublin 2, Ireland Dear Morris, Re; GEORGE CRAMPTQN..&.SQNS I reviewed my notes as promised over Ac weekend and as I understandit, the proposal isss gflgM- follows: ■S3 STARLING SECURITIES LIMITED C'Starling^, a Cayman company, owns shares in a U.S. Investment company, CORK INVEST3VlENTSrblC. CCork") Starling will contract to sell its shares to a thirdparty individual andwill receive cash from the sale. Starling will deposit the cash received from the sale proceeds with yon, and will hypothecate die funds to secure an advance to an Irish company, to enable it to acquire ihs shares from (he third parly individual. <* At this point, I amuncertain as to whether die price of the shares has been agreed, and therefore, •I amnot sure the extent of the "back-to-badr arrangement, I will seek to clarify this with my . Clients so that you can consider this applicationInprinciple once the amount is known. Yours sincerely, A. FURZE r tv'\*!;«.• r.» ■'• \ , A im o b it«/ ih« Fhil Netoaol Bonli _f e .^ L __ i t . u . * le n te n Btrffag/un J M a d M t r t u n n i n g Mm*it 2nrfefi h k t f M m HAanm Ciywn I t l t i a l t D r illili V t t g M J t k a f t MuifKMg * STARLING SECURITIES LIMITED Profit & Loss Account from 29th September 1984 to30th September 1985 REVENUE:Interest Receivable 21,634.26 Less EXPENDITURE:Management Fees 900.00 Government Fees and Sundry Disbursements 357.84 1.257.84 20,376.42 Met Profit to 28tb September 1984, brought forward 199,827.90 £220,204.32 STARLING SECURITIES LIMITED BALANCE SHEET AS AT 30 SEPTEMBER 1996 (expressed in Pounds Sterling) notes 1225 ASSETS Bank balances: Current account Fixed deposit Investment Accounts receivable and prepayments 2,792 129,000 125 325 £ 132,242 i LIABILITIES AND SHAREHOLDER'S EQUITY LIABILITIES Accounts payable and accrued expenses 803 SHAREHOLDER'S EQUITY Share capital Retained profits Loan capital 3 50 90,795 40,594 4 131,439 Total liabilities and shareholder's equity £ 132,242 £ Appendix XV (23) Captain WR Cuffe-Smith 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Captain WR Cuffe-Smith. a) An undated Letter o f Wishes headed Guinness Mahon Cayman Trust Limited. b) Letter o f 10 August 1977 - John Furze to Guinness and Mahon. c) Letter o f 3 April 1990 - JD Traynor to Guinness and Mahon. d) Letter o f 20 February 1992 - JD Traynor to Guinness and Mahon. e) Letter o f 30 September 1992 - Ansbacher Limited to IIB. G u in n e s s Hahon Cayman T r u s t L im it e d . P .O .B o x . 8fi7, Grand Caym an, B R IT IS H WEST IN O IE S . ^ Oear S i r a , ) As S e t t l o r o f th e D i s c r e t i o n a r y T r u s t e s t a b lis h e d by me t o d a y , I w ould w is h my T r u s te e s to h o ld th e T r u s t Fund p r i m a r i l y f o r th e b e n e f i t o f C a p ta in C u f f e -S m it h , t o make d i s t r i b u t i o n s h is w if e and t h e i r f a m i l y and to them o f c a p i t a l a n d /o r income as may be r e q u ir e d fro m tim e to t im e . I w ould how ever e xpect th e T r u s t e e s n o t t o m a k e ‘ any d i s t r i b u t i o n s w ith o u t f i r s t s e e k in g th e a d v ic e o f C a p ta in C u f f e -S m i t h , w if e B e t t y . o r f o l l o w i n g h is d e a th to c o n s u lt w i t h h is . • . In the event of the death of both Captain Cuffe-Smith and h is w ife, I would expect you to hold the Trust Funda fo r the b e n e fit of th a i r two daughters, Mrs. Lee Lane and Mrs.Margaret B utler in equal />**s sharas a b so lu te ly . ) Nothing in fchie l e t t e r should be takan as a p ro h ib itio n on the d ia trlb u tio n of the whole of the Trust Fund to any one parson e n title d to b e n e fit from the Truet and furtherm ore, I would expect you to give guaranteee fo r borrowinge by any of the b en a flo la rle e mentioned provided th a t advice ie taken in th is m atter ae e a t out above. i I h e re b y d e c la r e t h a t the re q u e s ts c o n ta in e d in t h i s ir re v o c a b le l e t t e r a re and cannot be changed by me in any w ay. « r-R - a i t h f u l l y . f ^ ^€OINNESS MAHON CAYMAN TRUST LIMITS) ' £ • A Member at tin GukiMM M»ho«*M*fch*nt BankingGroup T¥tophon«^ W-4«*a/4 *aBte«ar T.tax Cl* 30 # Cs Mv A M t m s GuinmM your rtt wrwi Oraod C*ymaa M iteh WM» India* JAF/ii 10th August, 1977 Leonard, Esq. Manage*. Accounts ’ Guinness * Uahon Ltd. 11 College &ieen Dublin 2 IRELAND T . R. ^ i • Vtwt Ra, ■ ' - CAPT. CUFFE-SUITH I do apologia £ot Hot having ntpLUd soohm .to you* lettefi ol iotk June concerning the split in the B/L" deposit account. This split has now been JtelUctitd in out books and 1 have retained the hypothecation agreement which you kindly enclosed. I have mitten separately today to Capt. Ca{{t-SnUk in connection uith the tmst and enctose jo* youh.in{o*»iU£on a copy a{ my Izttex. Kindest JtegtUtds, You/is sincjt/iely, I P f JOHN A. FURZE Encl. A M tm btr of th t Htnry Antbmchtr HoUbtgt PLC Mtrehmt ■ rftfrs ’ G ro f Please replyto: 42 FitzwiDum Square, Dublin 2. P.O . Box * rr. G rand Gqrou, B rithh W w t M T «kx: C P 4305 Ttfaccpoas R»* 0Ot) M0-7M6 (•09) 949-5267 Tel: 765144/763065 Fix: 612035 3 rd A p r i l , 1990 N . D a v id H u a p h rie s , E s q ., S e n io r Manager - O p e ra tio n s , G uinn ess 6 Mahon L im ite d , 17 C o lle g e G re en , DUBLIN 2. D ear D a v id , F u r t h e r t o my l e t t e r o f th e 27th March when I re q u e ste d you t o d e b it Ansbacher Account N o .13154602 w ith S t g . £30,000 and c r e d i t th e I r i s h Pounds e q u iv a le n t t o th e Acco un t o f C a p ta in W.R. C u ffe -S m ith w ith you numbered 10575007, I r e g r e t th e e r r o r i n these in s t r u c t i o n s The t r a n s f e r sho uld o f co u rse have been i n S t e r l i n g as I unde rstan d t h a t h is A ccount N o .10575007 i s a S t e r l in g A cco u n t. Th e purpose o f t h i s l e t t e r i s t o c o n firm th e a c t io n taken b y Una M aguire to da y when she arranged th e r e v e r s a l o f th e o r i g i n a l tr a n s a c tio n and th e t r a n s f e r o f th e S t e r l i n g am ount. A p o lo g ie s f o r any In co n ve n ie n c e caused. Y o u rs s in c e r e l y , J . D . Tra vn o r b* PhoBK (M ) MM ias/4 Please reply to: 42 FitzwilliamSquare, Dublin! Tet 765144/763065 Fax: 612035 BoxS*7,QtmdC* T 2 0 th F e b ru a r y , 1992 M. D a v id H um p hries, E s q ./ S e n io r Manager - O p e r a tio n s , G uinn ess ft Mahon L im it e d , 17 C o lle g e G re en , DOBLIN 2. D ear D a v id , C o u ld you p le a s e a rra n g e t o have th e e n clo s e d d r a f t f o r S t g . £30,000 lo dged t o c r e d i t o f Account N o .10575007 i n th e name o f C a p ta in C u f f e -S m ith . I w o uld be g r a t e f u l i f you co u ld acknowledge i n due c o u rs e . Yo u rs s in c e r e l y . J . D . Tra vn o r Please reply to: 42 Fhzwffliam Square. Dublin 1 Tel: 765144/763065 Fax: 612035 P.O. Box 117. Grand Cayman. Cayman Island*. Brnuh West Indies Telephone: (S09) 949-8655 Telex: CP 4305 Facsimile (109) 949-7946 (809) 949-5267 3 0 th Septem ber, 1992 Ronan Redmond , E s q . , C o rp o ra te S e r v i c e s , ' I r i s h I n t e r c o n t i n a n t a l Bank L im it e d , 91 M a r rio n S q u a re , DUBLIN 2 . Dear; Ronan, . C o u ld yo u p la a a a a rra n g e th a t r a n a f a r o f S t g .£ 1 1 7 ,4 2 0 .5 4 from A nab achar L im ita d No.1 A c co u n t N o .02/01087/81 t o : G u in n e ss a Mahon L im ite d 17 C o lle g e G re e n , D u b lin 2 , f o r c r e d i t to th e A c co u n t o f C a p ta in a n d /o r M rs . C u f f e -S m ith A c co u n t N o . 10575007. I t w o uld ba a p p r a c ia ta d i f 3 0 th Septem ber p le a s e . Y o u rs s i n c e r e l y . F o r ANSBACHER L IM ITE D DPC/AJW t h i s t r a n a f a r c o u ld ba mada to d a y Appendix XV (24) Mr Janies P Culliton 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James Culliton. a) Transcript o f evidence o f Mr James Culliton dated 28 February 2000 (redacted). b) Bank draft o f 15 September 1987 in favour o f a member o f Mr Culliton’s family (name redacted). c) Cheque dated 20 July 1987 in favour o f a member o f Mr Culliton’s family (name redacted). d) Letter o f 31 January 2000 from Gerrard Scallan O ’Brien to Inspectors. Note: The Inspectors have redactedthe enclosed documents to remove names not relevant to this Report. - UNDER OATH ON MONDAY, 2 8TH F E B R U A R Y 2000 I h e r e b y c e r t i f y the f o l l o w i n g to be a t r u e an d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer THE INSPECTORS: MR. JUSTICE DECLAN COSTELLO MS. N O R E E N M A C K E Y B.L. S O L I C I T O R to the INSPECTORS: MS. MARY CUMMINS INTERVIEWEE: MR. JAMES CULLITON R E P R E S E N T E D BY: MR. BRIAN STRAHAN GERRARD, SCALLAN & O'BRIEN HAINAULT HOUSE 6 9 / 7 1 ST. DUBLIN STEPHEN'S GREEN 1 2 3 4 MR. JUSTICE COSTELLO: 5 I am Declan Costello and Ms. M a c k e y is o n m y r i g h t . 6 A s y o u know, we are a p p o i n t e d Inspectors b y the High 7 Court. 8 i n t e r v i e w a n d if t h e r e a r e a n y q u e s t i o n s o n w h i c h 9 you w o u l d like the advice of your solicitor, T h i s is n o t a C o u r t o r a T r i b u n a l , it is a n please 10 t e l l m e a n d w e w i l l s t o p to a l l o w y o u o b t a i n t h a t 11 advice. 12 questions 13 you, 14 solicitor. 15 16 A. If y o u r s o l i c i t o r w i s h e s t o d i s c u s s a n y or a n y p o i n t a r i s i n g o n a n y q u e s t i o n w i t h we will stop and a l l o w you to co n s u l t w i t h your I appreciate your understanding, MR. JUSTICE COSTELLO: 17 solicitor, 19 you. 21 22 23 24 25 26 27 28 29 Inspector. Culliton, I am now going to ask our 18 20 Mr. Mr. Ms. C u m m i n s t o a d m i n i s t e r t h e o a t h to 1 FOLLOWS: 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Culliton, you have helpfully supplied through 6 y o u r s o l i c i t o r a s t a t e m e n t a n d I w i l l c o m e to t h a t 7 in a moment, 8 i n t r o d u c t i o n I w o u l d like yo u to give y o u r g e n e r a l 9 b a c k g r o u n d to y o u r a s s o c i a t i o n w i t h C e m e n t R o a d s t o n e a n d y o u r a s s o c i a t i o n in p a r t i c u l a r w i t h Mr. 10 11 b u t b e f o r e d o i n g so j u s t b y w a y o f A. Certainly. Traynor? I j o i n e d R o a d s t o n e in 1 9 5 2 as a n 18 y e a r 12 old. At that time Roadstone was a ve r y small 13 co m p a n y indeed. 14 extent by T o m and Donal Roche. 15 employees 16 I f o u n d it a f a n t a s t i c l e a r n i n g e x p e r i e n c e a n d it 17 just grew and grew with the Irish economy. 18 w h i c h was the y e a r of the m e r g e r w i t h Cement, 19 r e a c h e d p r o f i t s o f a b o u t £1 m i l l i o n a n d it w a s a 20 p u b l i c a l l y quo t e d company. 21 b i d d i n g f o r t h e C e m e n t c o m p a n y b u t t h e y w e n t on 22 strike for five m o n t h s a nd we h a d no r aw m a t e r i a l s 23 a n d w e w o u l d h a v e e n d e d u p in s e r i o u s 24 difficulties, 25 o u t r a g e o u s b i d f o r C e m e n t a n d w e w e r e s a t i s f i e d at 26 l e a s t it w o u l d s e t t l e t h e s t r i k e v e r y q u i c k l y , 27 it d i d i n a c o u p l e of w e e k s . It w a s o w n e d a n d m a n a g e d t o a l a r g e They had about 100 at t h a t t i m e a n d o n e p i t a n d o n e q u a r r y . By 1970 it h a d W e h a d n o i n t e n t i o n of financial so w e m a d e w h a t w a s r e g a r d e d as an which 28 29 I came up t h r o u g h the sales a nd m a rketing. I was 1 n e v e r an a c c o u n t a n t or a f i n a n c i a l p e r s o n an d I went 2 into general management. 3 merg e r was 4 Mr. 5 He w a s 6 b e c a u s e he was d e f e n d i n g Cement against Roadstone. 7 A s M a n a g i n g D i r e c t o r of G u i n n e s s M a h o n h e w a s t h e 8 financial advisor. 9 h a p p e n e d except that the B r i t i s h c o m p a n y R e a d y m i x formed, W h e n the C e m e n t R o a d s t o n e that was the first time I met T r a y n o r a n d t h a t w o u l d h a v e b e e n i n e a r l y 1971. in an u n u s u a l l y p o w e r f u l p o s i t i o n e v e n t h e n The m e r g e r w o u l d not have 10 b i d f o r R o a d s t o n e i n t h e m i d d l e o f o u r b i d d i n g fo r 11 Cement, 12 w e w e r e f i g h t i n g o f f an u n w e l c o m e b i d f r o m t h e g i a n t 13 Readymix. 14 t h e y d i d n o t w a n t to se e R o a d s t o n e g e t t i n g i n t o 15 f o r e i g n hands, 16 days a n d t h e y l e a n e d on I r i s h Life w h o h a d a b out a 17 10% s h a r e h o l d i n g in e a c h c o m p a n y t o b r i n g t h e t w o 18 companies together. so w e w e r e s e e k i n g a m e r g e r w i t h C e m e n t a n d The Government then took a hand because you could t h i n k like that in those 19 20 T h a t is w h a t h a p p e n e d a n d w e w e r e f o r t u n a t e t h a t 21 S e a n L e m a s s w h o h a d r e t i r e d as T a o i s e a c h a g r e e d to 22 become independent 23 U n f o r t u n a t e l y s o m e m o n t h s a f t e r he b e c a m e c h a i r m a n 24 he f e l l i n t o s e r i o u s b a d h e a l t h a n d h e d i e d a y e a r 25 later. 26 chairman and serious rowing took place between Tom 27 R o c h e o n o n e h a n d fo r R o a d s t o n e a n d A n k e r l u n d o n t h e 28 ot h e r , 29 m e r g e d company. c h a ir m a n of the n e w company. U n f o r t u n a t e l y we were then left with o u t a t h e y b e i n g j o i n t M a n a g i n g D i r e c t o r s of t h e Lots of t hings h a p p e n e d that s h o u l d 1 not have h a ppened and event u a l l y after Bob Willis 2 was C h a i r m a n for a short time and h a d a hold i n g 3 operation, 4 non-Executive Chairman. Michael D a r g a n w a s h e a d h u n t e d i n as 5 6 At that time I w a s n ' t on the Board. 7 h o l d a c o m p e t i t i o n fo r C h i e f E x e c u t i v e a n d t h e y h a d 8 international 9 I w a s a p p o i n t e d C h i e f E x e c u t i v e of t h e G r o u p i n J u l y advisors. T h e y d e c i d e d to I won that competition and 10 19 74 a n d t h a t is w h e n I b e c a m e i n v o l v e d w i t h D es 11 T r a y n o r as a n o n - E x e c u t i v e D i r e c t o r . 12 2 Q. Director? 13 14 A. 15 16 Yes, h e was. He w a s o n t h e B o a r d f r o m t h e e n d of 1 9 7 0 a n d I j o i n e d t h e B o a r d o f C R H i n J u l y 1974. 3 Q. 17 18 You were C hief Exe c u t i v e and he was n o n - E x e c u t i v e Sorry, as C h i e f E x e c u t i v e y o u w e r e a l s o o n t h e Board? A. Yes, I was. When I became Chief Executive I was 19 a p p o i n t e d to t h e B o a r d s i m u l t a n e o u s l y . 20 C h i e f E x e c u t i v e in 19 87 w h i c h w a s t h e y e a r t h a t Des 21 Traynor became Chairman ultimately. 22 4 Q. 23 24 I r e t i r e d as Y o u r r e l a t i o n s h i p w o u l d h a v e b e e n a v e r y c l o s e one, is t h a t r i g h t ? A. Yes. I n t h e s e n s e t h a t h e w a s M a n a g i n g D i r e c t o r of 25 G u i nness M a h o n and I was d e t e r m i n e d to m ake CRH into 26 an i n t e r national 27 R e p u b l i c of I re l a n d and we w ere e x t r e m e l y v u l n e r a b l e 28 b e c a u s e t h e e c o n o m y h a d it s g o o d d a y s a n d i t s b a d 29 days a n d we just came in a n d out w i t h the tide. company. At that time CRH was 95% The 1 Board was 2 one-third executive, 3 b a l a n c e of p o w e r at a l l t i m e s . 4 a l o n e I h a d to w o r k a n d b r i e f t h e n o n - E x e c u t i v e 5 Directors, 6 America, 7 the things that w ere involved. 8 Traynor, 9 m a i n l y in b r i e f i n g him. 10 a n d t h e o t h e r s as well , 11 Directors. 12 De s T r a y n o r b a s e d o n h i s p e r f o r m a n c e i n CRH. 13 5 Q. Mr. structured two-thirds non-executive and so t h e n o n - e x e c u t i v e s h e l d t h e a l l o f them, as to w h y w e s h o u l d go to w h y w e s h o u l d g o to m a i n l a n d E u r o p e a n d a l l I w o u l d say, So, Culliton, yes, I would have met Bob Willis the other non-Executive I f o r m e d a v e r y h i g h o p i n i o n of if w e c o m e to y o u r s o l i c i t o r ' s H a v e y o u g o t a c o p y o f it t h e r e , 15 31st January? A. 17 6 Q. 18 Yes, I w o u l d h a v e m e t Des four or five times a m o n t h 14 16 For that r eason letter. the l e t t e r of I hav e. Y o u a r e r e p l y i n g t o m a t t e r s t h a t w e h a d r a i s e d in a letter. 19 A. Yes. 20 7 Q. What I w o u l d l i k e y o u t o do w o u l d b e t o e x p a n d a 21 l i t t l e b i t on t h e m a t t e r s t h a t y o u d e a l t w i t h in 22 this letter. 23 of t h e p e r s o n w h o i n f o r m e d y o u o f t h e s e r v i c e , 24 c o r r e s p o n d e n c e a n d d o c u m e n t a t i o n i n r e l a t i o n to it. 25 P e r h a p s y o u w o u l d t e l l u s i n as m u c h d e t a i l as y o u 26 c a n r e m e m b e r t h e w a y in w h i c h t h e q u e s t i o n of t h i s 27 s e r v i c e t h a t w e r e f e r r e d y o u to a n d e x a c t l y w h a t t h e 28 c o n v e r s a t i o n s w e r e w i t h Mr. 29 A. Well, In p a r a g r a p h 2(a) the name and address Traynor? I w o u l d n ' t g o so f a r as t o r e m e m b e r t h e 1 conversations with him but I clearly remember him 2 suggesting this 3 full r e s p o n s i b i l i t y for m y own m i s t a k e s 4 i f y o u b e a r in m i n d t h a t h e w a s a v e r y s e n i o r 5 D i r e c t o r o f CRH, 6 C o m m i t t e e a n d he w a s o n t h e F i n a n c e C o m m i t t e e . 7 t h a n t h a t he w a s r e p r e s e n t i n g t h e C e m e n t 8 h o u s e w h i c h was sort of t w o - t h i r d s C e m e n t and 9 one-third Roadstone, f a c i l i t y t o me. M a y I say, I take i n thi s, he was on the R e m u n e r a t i o n they being the relative sizes of the two companies. 11 to me in that 12 h i g h t a x r a t e s at t h e tim e, 13 t h e 1 9 7 0 ' s w e r e 70% to 7 7% d u r i n g t h e 1 9 7 0 ' s . 14 suggested this 15 d i d n o t k n o w a b o u t it. 8 Q. 17 A. More side of the 10 16 but I m a y have p r o v o k e d his o ffer I p r o b a b l y was r e f e r r i n g to the v e r y facility, t h e t o p r a t e s of t a x in He I d i d n o t i n i t i a t e it, I W o u l d y o u t e l l m e n o w w h a t it w a s ? Yes, h e s a i d t h a t h e c o u l d p l a c e m o n e y f o r m e in a 18 d e m a n d account, 19 v a r i a b l e rate of i nterest a nd that the in terest 20 w o u l d be p a i d gross. 21 w a s £ 1 0 , 0 0 0 to £ 1 2 , 0 0 0 in a b a n k a c c o u n t h e r e a n d I 22 s u p p o s e I w a s n a i v e e n o u g h to p a y t h a t f r o m a n I r i s h 23 b a n k account into this 24 t o m e t h a t it w a s to b e s e c r e t . 25 a p p l i c a t i o n f o r m to sign, 26 s t a t e m e n t s a n d t h e r e w a s n o r e f e r e n c e t o f e e s or 27 commissions 28 29 9 Q. that the deposit w o u l d have a I h a d on deposit facility. I t h i n k it It w a s q u i t e c l e a r I got no no documents, no for G u i n n e s s M a h o n or for Des Traynor. D i d he t e l l y o u w h e r e t h e d e p o s i t w o u l d b e p l a c e d ? 1 ago, 2 t h a t it w a s t h e C h a n n e l 3 10 Q. 4 A. Mr. Inspector, and m y i m p r e s s i o n c l e a r l y was Islands. It w a s o f f s h o r e a n y w a y ? Absol u t e l y offshore. He e i t h e r t o l d m e or I a s s u m e d 5 it w a s t h e C h a n n e l 6 is w h e r e o f f s h o r e 7 g a v e De s T r a y n o r m o n e y t o p u t in. 8 11 Q. 9 Mr. 11 A. 12 12 Q. funds went. J u s t b e f o r e w e c o m e to tha t, more detail. 10 I s l a n d s b e c a u s e at t h a t t i m e t h a t From time to time I I w ould like a little Do y o u r e m e m b e r w h e n t h i s was, Culliton? Yes, 1979. Your u n d e r s t a n d i n g was that he was g o i n g to p l a c e 13 funds that you gave him offshore, 14 the Cha n n e l 15 A. 16 13 Q. you thought, in Islands? Yes. Y o u w o u l d g e t a v a r i a b l e i n t e r e s t rate, it w o u l d b e 17 p a i d g r o s s a n d it w o u l d b e s e c r e t a n d t h a t m e a n t 18 t h a t y o u w o u l d n o t be r e t u r n i n g t h e i n t e r e s t 19 purposes ? 20 A. 21 22 That was my mistake. dec l a r e d this account, 14 Q. for tax I knew then that I should have but I d i d n ' t d o th a t . I a p p r e c i a t e y o u r a p p r o a c h to t h i s w h o l e p r o b l e m 23 Mr. 24 f a c t s now. I am not m a k i n g a jud g m e nt on the 25 situation. So y o u o b t a i n e d t h e b e n e f i t of t h i s 26 f a c i l i t y t h a t he g a v e y o u ? 27 A. 28 15 Q. 29 Culliton, but I j u s t w a n t to g e t t h e a c t u a l I did. T h a t w a s i n 1 9 7 9 a n d y o u t r a n s f e r r e d m o n e y to h i m th e n. C o n t i n u e then , please. How was the facility operated? 1 2 3 He h a d an o f f i c e j u s t at t h e b a c k of G u i n n e s s M a h o n 4 a n d I w o u l d h a v e b e e n in a n d o u t a n y w a y t o b r i e f h i m 5 b e t w e e n B o a r d m e e t i n g s on CRH affairs. 6 m o n e y I o n l y n e e d e d t o g i v e h i m a f e w d a y s n o t i c e or 7 if I h a d m o n e y t o p u t in, 8 g i v e it to h i m i n t h e b a n k . 9 him until 16 Q. All my dealings with I cl o s e d the account were in Trin i t y W h e n you gave him money, t h i s w a s t o b e l o d g e d to this offshore account. 12 13 A. 14 17 Q. 15 16 I c o u l d b r i n g it in a n d S t r e e t in h i s b a n k . 10 11 If I n e e d e d Yes. D i d y o u g i v e it t o h i m i n c a s h o r d i d y o u g i v e it to h i m b y c h e q u e o r h o w w a s it d o n e ? A. I h o n e s t l y c a n ' t a n s w e r t h a t one. I p resume that 17 t h e d r a w i n g s w e r e in c a s h b e c a u s e h e w a s i n t h e 18 b an k , 19 18 Q. I s t a r t e d off w i t h a cheque. I w a n t to g e t c l e a r is d i d y o u g i v e h i m s t e r l i n g drafts or a n y thing like that? 20 21 A. 22 19 Q. 23 24 What but No. T h e y w o u l d h a v e b e e n I r i s h c u r r e n c y or a c h e q u e f r o m an I r i s h b a n k ? A. 25 U n l e s s o c c a s i o n a l l y I h a d a s t e r l i n g draft, h a v e u s e d that . 26 20 Q. This w o u l d be o ccasionally? 27 A. That w ould be occasionally, 28 21 Q. 29 I could yes. You w o u l d from time to time then add to the deposit 1 2 A. 3 22 Q. 4 A. That's correct. These d r a w i ng s w ere u s u a l l y cash in the bank? The drawings, I wouldn't say exclusively but I think 5 for the p u r p o s e of the q u e s t i o n you are a s k i n g me I 6 w o u l d s a y v i r t u a l l y a l l cash . 7 23 Q. This t o o k p l a c e in G u i n n e s s M a h o n b e c a u s e 8 Mr. Traynor, we learned, as C h a i r m a n of C e m e n t 9 R o a d s t o n e h a d a n o f f i c e in C e m e n t R o a d s t o n e b u t he 10 h a d n ' t an o f f i c e in C e m e n t R o a d s t o n e d u r i n g t h e 11 p e r i o d that we are c o n c e r n e d with? 12 A. No, I d e c i d e d in 1 9 8 6 t o r e t i r e , it w a s e n t i r e l y m y 13 own decision. 14 E x e c u t i v e w h i c h is a v e r y l o n g ti m e . 15 was t r a n s f o r m e d and we h a d huge i n t erests in A m e r i c a 16 a n d m a i n l a n d E u r o p e a n d so on. 17 M i c h a e l D a r g a n h a d d e c i d e d to s t e p d o w n as C h a i r m a n , 18 he h a v i n g b e e n a b o u t 19 T r a y n o r w a s c h o s e n u n a n i m o u s l y b y t h e B o a r d to 20 b e c o m e C h a i r m a n at t h e A G M i n M a y 1987 . 21 w a s c h o s e n t o w a r d s t h e e n d o f 1 9 8 6 as C h i e f 22 Executive designate, 23 De s T r a y n o r b e c a m e C h a i r m a n I s a i d t o b o t h of t he m ; 24 "look, 25 E x e c u t o r s h i p t h e r e is n o p o i n t i n m y f o r m i n g a 26 r e l a t i o n s h i p w i t h you, 27 future." 28 own relationship." 29 a Chairman and a Chief Executive was hugely I h a d b e e n 13 y e a r s as C h i e f The comp a n y At the same time 14 y e a r s i n t h e C h a i r a n d D es Tony Barry effectively m y successor. for the r e m a i n i n g few mo n t h s Des Traynor. When of m y C h i e f L o o k to the I s a i d t h e s a m e to T o n y B a r r y ; "build your Because the relationship between 1 important 2 right. 3 Pem br o k e Street, 4 until 5 E x e cutive anyway. 6 D a r g a n ' s o f f i c e i n M a y 1 9 8 7 but, 7 h a v e a c h i e f e x e c u t i v e r e l a t i o n s h i p w i t h him, 8 w o u l d h a v e b e e n s i l l y to h a v e d o n e so. 9 a n d l e t T o n y a n d h i m s e l f do t h a t a n d h a v e t h e 24 Q. At that time Michael 1989, D a r g a n ' s o f f i c e w a s in 42 F i t z w i l l i a m S q u a r e d i d n o t e x i s t maybe 1990. It w a s a f t e r m y t i m e as a n Des T r a y n o r m o v e d i n t o M i c h a e l T h e f a c i l i t y t h a t Mr. as I say, I didn't it I stood back T r a y n o r h a d a r r a n g e d f o r you, it c a m e to an e n d when , 12 13 t h e c h e m i s t r y h a s to b e relationship. 10 11 in a b i g gr o u p , A. Mr. Culliton? I w a n t e d to e n d it as I w a s r e t i r i n g . The B o a rd 14 k i n d l y i n v i t e d m e t o s t a y o n as a n o n - E x e c u t i v e 15 D i r e c t o r a n d I did, 16 b e g i n n i n g o f 1988, 17 Director. 18 Castle, 19 S q u a r e a n d I r e m a i n e d as a n o n - E x e c u t i v e D i r e c t o r 20 u n t i l I b e c a m e v e r y i l l at t h e e n d o f 1 9 9 3 a n d I 21 r e t i r e d f r o m t h e B o a r d i n 1 994. 22 De s T r a y n o r d i e d as w e l l . 23 25 Q. 24 I a c c e p t e d that f rom the I was then a non-Executive The B o a r d m e e t i n g s were h e l d in B e l g a r d m a y b e a v e r y odd one was h e l d in F i t z w i l l i a m The o f f s h o r e Just after that A GM facility that you had arranged, when did that complete? 25 A. 26 26 Q. E a r l y t o m i d 1987. I w a n t to a s k y o u a b o u t a f i n a n c i a l t r a n s a c t i o n 27 w h i c h h a s c o m e to o u r n o t i c e . It is a l o d g m e n t 28 w h i c h was p a i d into an ac c o u n t in t h e n a m e o f A m i e n s 29 S e c u r i t y to w h i c h w e r e f e r in o u r l e t t e r . This 1 a p p e a r s to h a v e b e e n an a c c o u n t w h i c h w a s o p e r a t e d 2 b y Mr. 3 l o d g m e n t to t h i s a c c o u n t o n 1 5 t h S e p t e m b e r 4 is a n A l l i e d I r i s h d r a f t p a y a b l e to T r a y n o r for d i f f e r e n t p u r p o s e s 5 for £7,684.34 (Exhibit a n d t h e r e is a 1). recollect what that could have been and 7 could have been? A. 9 T h i s is a d r a f t for ho w much? 10 For £7,684.34. So rr y, 12 2 0 t h J u l y 1987, the payee was 13 £6,491.10 11 14 27 Q. A. 15 t h e r e is a s e c o n d o n e on for a n d it is a J & E D a v y c h e q u e I w o u l d h a v e to t h i n k a b o u t t h o s e , ( E x h i b i t 2). but I know all the time I h ave b ee n s u p p o r t i n g financially 16 It l o o k s to 17 18 m e as if t h e y w o u l d b e t h e s a l e o f s h a r e s 28 Q. Really what for . I w o u l d b e i n t e r e s t e d i n is c a n y o u 19 r e m e m b e r h o w d i d it c o m e a b o u t t h a t t h e s e c h e q u e s 20 w e r e a p p a r e n t l y g i v e n to Mr. 21 hi m in Am i e n s 22 you d i d not p a y the sums d i r e c t l y to 23 w a y Mr. 24 It Can you 6 8 1987. A. Traynor and lodged by Security's account. It l o o k s as if , in some T r a y n o r was i n v o l v e d in the t ransfer. T h a t is a b o l t from the b l u e quite honestly. I 25 can't recall the context of those two p a y m e n t s but 26 if it is J & E Davy, 27 of s h a r e s . 28 29 29 Q. it c e r t a i n l y l o o k s l i k e t h e s a l e P e r h a p s w e c o u l d g e t it i n a d i f f e r e n t w ay . When you were h e l p i n g your sister and t r a n s f e r r i n g funds 1 2 O n l y last w e e k I sent 3 r e l e v a n t r e a l l y b u t . .. 4 30 Q 5 6 £1,000 pounds, it is n o t C a n y o u r e m e m b e r b a c k in t h o s e d a y s h o w y o u w o u l d h a v e s e n t m o n i e s to ? A 7 8 9 10 11 I can't relate those two payments. 12 13 another occasion I invested £20,000 14 w o u l d h a v e b e e n a b o u t t e n y e a r s ago. 15 31 Q It is j u s t t h a t I w a n t to clarify, for On , that if at a l l 16 possible, 17 m a k e v e r y c l e a r t o us a b o u t t h e f a c i l i t y t h a t w a s 18 o f f e r e d a n d I w a n t to a s c e r t a i n w h e t h e r o r n o t t h e s e 19 p a r t i c u l a r c h e q u e s w e r e p a r t of the f a c i l i t y that he 20 ha d given or were the y a dif f e r e n t arr a n g e m e n t ? 21 A No, Mr. T r a y n o r ' s r e l a t i o n s h i p w i t h you. y o u c a n t a k e it t h a t You I on l y h a d one a r r a ng e m e n t 22 w i t h Mr. T r a y n o r a n d if y o u h a v e i d e n t i f i e d t h e s e 23 cheques, I c e r t a i n l y g a v e t h e m t o him. 24 32 Q 25 A 26 27 Y o u w o u l d h a v e g i v e n t h e m to him? Yes, absolutely, I c a n ' t t h i n k of a n y o t h e r c o n t e x t in w h i c h I w o u l d h a v e d o n e o t h e r w i s e . 33 Q There are two o ther m a t t e r s I want to c l a r i f y with 28 you, 29 w o u l d h a v e c o m e t o a n e n d i n 1987. Mr. Culliton. You said that this arrangement D i d y o u a v a i l of t h e t a x a m n e s t y p r o v i s i o n s at a n y s t a g e ? 1 2 A. I d i d n ' t a v a i l o f t h e t a x a m n e s t y b u t i n 19 98 I made 3 m y b e s t e f f o r t to p a y the ta x a n d the p e n a l t i e s . 4 19 98 5 that s h ou l d have b e e n paid. 6 any documentation, 7 t h a t I w a s g e t t i n g f r o m y e a r t o ye a r . 8 as b e s t I c o u l d t h a t t h e t a x p l u s t h e p e n a l t i e s 9 to £26,000, I c a l c u l a t e d as b e s t In I c o u ld the a mount of tax I didn't Because I didn't have know the interest rate I calculated came t h a t b e i n g 15% p u n i t i v e i n t e r e s t o v e r 10 nine years 11 uncertainty and because 12 b e h i n d m e a n d g e t it o f f m y c o n s c i e n c e , 13 Revenue through a solicitor £50,000 14 a r e c e i p t a n d I c a n s h o w it to y o u or g i v e it t o y o u 15 now. 16 r e a s o n I d i d it i n 1 99 8 o n a n a n o n y m o u s b a s i s w a s 17 j u s t d i d n o t w a n t to c r e a t e m o r e t r o u b l e 18 c o m p a n y CR H an d Des Traynor. 19 l o o k at t h e r e c e i p t 20 34 Q. No, I t h i n k it was. B e c a u s e of t h e I was d e t e r m i n e d to put that I p a i d the for w h i c h I have That was done on an a n o n y m o us b asis and the I for m y own Feel free to have a from the Revenue. I d o n o t n e e d to. So t h e p o s i t i o n as f a r as y o u 21 a r e c o n c e r n e d is t h a t a n y p o s s i b l e t a x l i a b i l i t y h a s 22 been paid? 23 A. I a m c o n f i d e n t o f that, yes, b u t as t o t h e p r e c i s e 24 w a y the R e v e n u e w o u l d treat this o m i s s i o n on m y 25 par t , 26 35 Q. 27 A. I a m n o t c l e a r on that . V e r y wel l . T h e y m a y s a y it is n o t j u s t 28 more, 29 me . but 15% p e r a n n u m , it is I h o n e s t l y t r i e d in 19 98 t o p u t it b e h i n d 1 36 Q. V e r y well. One last t hing I want to ask you about 2 Mr. 3 l etter you r e f e r r e d to what h a p p e n e d w h e n you were 4 s t e p p i n g d o w n as C h i e f E x e c u t i v e i n N o v e m b e r 1 9 8 7 ? 5 A. 6 37 Q. Culliton, at t h e l a s t m a i n p a r a g r a p h of y o u r Yes. Y o u w i l l a p p r e c i a t e t h a t o u r c o n c e r n is i n r e l a t i o n 7 to G u i n n e s s M a h o n C a y m a n T r u s t a n d l a t e r k n o w n as 8 Ansbacher 9 A. 10 38 Q. (Cayman) Ltd. Yes. If t h i s w a s n o t a n A n s b a c h e r c o m p a n y w e a r e n o t 11 concerned with this matter. 12 tell me w h e t h e r you t h i n k this was an A n s b a c h e r 13 c o m p a n y f r o m w h i c h t h e s e p a y m e n t s w e r e m a d e o r do 14 you know? 15 A. I w o u l d l i k e y o u to T h e r e w a s no r e a s o n at a l l f o r it t o b e a n A n s b a c h e r 16 company. 17 c a n e l a b o r a t e t h e n if y o u w i s h t o q u e s t i o n m e 18 further. 19 s h o w t h a t he in p a r t i c u l a r w a s a n x i o u s t o m a k e s o m e 20 f o r m of f i n a l p a y m e n t t o m e as r e t i r i n g C h i e f 21 Executive, 22 Board's 23 w h e n I b e c a m e C h i e f E x e c u t i v e h a d a v a l u e of 24 £25 m i l l i o n was n o w w o r t h about £700 m i l l i o n a nd was 25 a well respected international group with big 26 interests 27 I s l e s a n d so on. 28 p a y m e n t to m e w o u l d h a v e to be d e c l a r e d in the 29 company's Perhaps I could just e x plain b r i e f l y and I T h e C R H f i l e s in 1987, Des T r a y n o r ' s files a final b o n u s or some w a y of s h o w i n g the a p p r e c i a t i o n of the fact t h a t the c o m p a n y in A m e r i c a , Europe and in the Brit i s h The a dv i c e he got was that any accounts, the annual report. He was 1 o b v i o u s l y r e l u c t a n t to m a k e a p a y m e n t t h a t w o u l d 2 attract that 3 Mr. 4 m i g h t h a v e a n y p r o b l e m w i t h it, 5 of M a y 1 98 8 t h e y w e r e v e r y w a r m i n t h e i r p r a i s e o f 6 m y c o n t r i b u t i o n as l e a d e r o f t h e t e a m a n d so on. 7 he m a d e a p a y m e n t to m e a p a r t 8 could have t r i g gered off a higher pens i o n because 9 the p e n s i o n was b a s e d on y our last year's sort of attention. Inspector, It w a s n ' t , I th i n k , t h a t he t h o u g h t t h e s h a r e h o l d e r s i n f a c t at t h e A G M f r o m t h a t is s u e , If it 10 remuneration which would have been very expensive 11 for the company. 12 d i d n ' t w a n t it to b e s e e n in t h e a n n u a l r e p o r t to 13 h a v e m a d e a b i g £ 1 0 0 , 0 0 0 p a y m e n t t o m e or £ 1 2 0 , 0 0 0 14 w a s t h a t Mr. 15 1 9 8 7 a n d h a d b r o u g h t in s o r t o f a h a i r - s h i r t 16 environment where everything was frozen and there 17 were cutbacks 18 and directors' 19 being watched very carefully. A n o t h e r r e a s o n I t h i n k w h y he H a u g h e y had b e c o m e T a o i s e a c h in A u g u s t in h e a l t h s e r v i c e s a n d so on. Wages fees an d all that sort of t h i n g w e r e 20 21 So, 22 gifts to 23 a n y s e r v i c e s to the company, 24 clear. I didn't 25 or t h i s s o r t o f t h i n k i n g b e c a u s e y o u n e v e r got 26 i n v o l v e d in y o u r own r e m u n e r a t i o n , 27 Remuneration Committee 28 r e t i r e d h e c a l l e d m e in a n d h e s a i d t h a t t h e B o a r d 29 h a d d e c i d e d to g i v e g ifts to he d e v i s e d this a l t e r n a t i v e w h i c h was to m a k e , not that they had pro v i d e d that was absolute k n o w a b o u t t h i s r e s e a r c h g o i n g on f o r t ha t . there was a Board Just before I of 1 £20,000 each and that there were two important 2 requirements; 3 s u b s i d i a r y o f CRH, 4 s o l e b e n e f i c i a r i e s of t h i s m o n e y . (1) they must and come from an overseas (2) m u s t be the 5 6 To a n s w e r your question, t here was no n e e d from a 7 t a x a t i o n p o i n t o f v i e w o r a n y o t h e r p o i n t of v i e w 8 for that to be a C a y m a n I s l a n d a c c o u n t a n d m y h o p e 9 is t h a t it is n o t a C a y m a n I s l a n d a c c o u n t . my excellent advisor, Brian 10 Strahan, was a b s o l u t e l y 11 a d a m a n t a n d I w a s v e r y h a p p y m y s e l f t o d r a w it to 12 y o u r a t t e n t i o n b e c a u s e it w a s Des T r a y n o r a n d it w a s 13 Guinness Mahon, 14 this 15 a c t as i n t e r m e d i a r y a n d I e n s u r e d t h a t and I am satisfied that they did pay from an o verseas account, t h a t h e a s k e d m e to 16 17 18 19 20 21 T h e a n s w e r is I d o n ' t d i d to i m p l e m e n t thi s. 22 23 k n o w w h a t Des T r a y n o r 39 Q 24 Y o u w e r e t o l d that the m o n e y was c o m i n g f r o m an overseas 25 A 26 40 Q 27 s u b s i d i a r y of C R H ? Yes . W h e r e the overseas s u b s i d i a r y got the m o n e y from you d o n o t know, 28 A 29 41 Q Yes, is t h a t t h e s i m p l e p o s i t i o n ? t h a t ' s right. W e h a v e h a d e v i d e n c e of o v e r s e a s c o m p a n i e s of C e m e n t 18 1 Roadstone which existed and from which payments were 2 m a d e to D i r e c t o r s 3 f r o m o n e o f t h e s e c o m p a n i e s o r w a s it a c o m p a n y 4 e s p e c i a l l y set up, 5 A. for expe n s e s . C o u l d it h a v e b e e n do y o u k n o w ? I w o u l d s a y it w a s o n e o f t h e n o r m a l C R H o v e r s e a s 6 companies but 7 I k n o w is w h a t De s T r a y n o r t o l d m e a n d I f a i t h f u l l y 8 c a r r i e d o u t m y p a r t as i n t e r m e d i a r y . 9 got the money. MR. 10 I c o u l d n ' t b e c e r t a i n w h i c h one. JUSTICE COSTELLO: Mr. I certainly Culliton, t h a n k you. I have no further 11 12 q u e s t i o n s to a s k y o u b u t Ms. 13 to a s k y o u a q u e s t i o n o r two. 14 All 42 Q. MS. MACKEY: Mr. M a c k e y w o u l d like you Culliton, really I have onl y one q u e s t i o n and 15 16 it is j u s t o n t h a t v e r y l a s t i s s u e . 17 e x p l a i n e d t h e r e to Mr. 18 you b e l i e v e d the m o n e y came f rom an o f f s h o r e a c count 19 b e c a u s e De s T r a y n o r w a s i n v o l v e d a n d t h e n y o u s a i d 20 " a n d it w a s G u i n n e s s M a h o n , " w h a t e x a c t l y d i d y o u 21 mean by that? 22 A. W h e n you Justice Declan Costello that I am b e w i l d e r e d b y the r e v e l a t i o n s a bout Des T r a y n o r 23 i n t h e l a s t c o u p l e of y e a r s b e c a u s e t h a t is n o t t h e 24 m a n t h a t I k n e w as a c o l l e a g u e , 25 I really am bewildered, 26 i m p r e s s i o n is t h a t h e d i d n ' t l e a v e G u i n n e s s M a h o n in 27 1986/87, 28 29 43 Q. I h a v e t o s a y that . h e j u s t f o o l e d us all. h e c o n t i n u e d o n as G u i n n e s s M a h o n . Y o u r i m p r e s s i o n is t h a t h e d i d n o t l e a v e ? My 1 y e a r s a g o w a s t h a t he c h a n g e d h i s r o l e i n G u i n n e s s 2 Mahon, 3 Mahon Ireland but 4 b e c o m i n g C h a i r m a n of CRH, 5 us t h a t h e h a d a c o n t i n u i n g r e l a t i o n s h i p i n t h e 6 b i g g e r G u i n n e s s M a h o n group. 7 44 Q. t h a t h e l e f t as M a n a g i n g D i r e c t o r o f G u i n n e s s I th o u g ht that was b e c a u s e he was b u t h e l e t it b e k n o w n to Can you explain that a little bit further? What 8 e x a c t l y d i d h e m a k e k n o w n to y o u or w h a t d i d y o u 9 understand? 10 A. That he was l o o k i n g a f t e r o v e r s e a s a n d o f f s h o r e business 11 12 45 Q. 13 A. in G u i n n e s s M a h o n . D i d he s p e c i f y w h a t t h a t w a s ? He m a y h a v e b u t I don't recall, but m y firm 14 r e c o l l e c t i o n is t h a t h e c o n t i n u e d o n s o r t of 15 s e e m l e s s l y as G u i n n e s s M a h o n in a d i f f e r e n t r o l e . 16 h a v e h e a r d r e c e n t l y t h a t t h e r e w a s s o m e d i s p u t e in 17 G u i n n e s s M a h o n a n d t h e r e w a s s o m e loan, 18 k n o w a n y t h i n g a b o u t that , 19 select a chairman. 20 was a ver y able and l i k eable person. 21 n o t h i n g c o l d or c a l c u l a t i n g a b o u t Des Traynor. 22 w a s a m o s t c o m p a s s i o n a t e m a n a n d I a m as b e w i l d e r e d 23 as m a n y p e o p l e r e a d i n g a b o u t t h e e v e n t s o f t h e l a s t 24 c o u p l e o f w e e k s h a v i n g b e e n c l o s e t o him. 25 4 6 Q. I didn't n o r d i d w e w h e n w e c a m e to H e is a c o m p l e t e e n i g m a . He There was He W h e n y o u s a i d a f e w m o m e n t s a g o t h a t it w a s Des 26 Tr a y n o r and G u i n n e s s Mahon, 27 t h a t c o n t e x t t h a t y o u b e l i e v e d he w a s a s s o c i a t e d , 28 t h a t it m u s t b e G u i n n e s s M a h o n ? 29 A. I 'Offshore' w e r e y o u s p e a k i n g in is n e a r l y a d i r t y w o r d n o w a n d t h i s w a s so 1 2 47 Q W h e n y o u s a y it w a s a n " o f f s h o r e p a y m e n t , " he h a d 3 e x p l a i n e d to y o u t h a t it w a s 4 company? 5 A 6 48 Q A non-resident from a non-resident company. Your sol i c i t o r says in this letter that the mo n i e s 7 w ere r e c e i v e d from an o f f s h o r e account. 8 words, 9 account, 10 A this non-re s i d e n t W h a t h e s a i d to m e w a s t h a t h e w a s s e t t i n g u p a co m p a n y for 12 t h e CRH. 49 Q 14 A c o m p a n y h a d an of f s h o r e w a s t h a t y o u r u n d e r s t a n d i n g of i t? 11 13 In o t h e r He w a s Yes, to r e c e i v e t h e m o n e y f r o m setting up a company? he w a s s e t t i n g u p a c o m p a n y , but m y solicitor 15 is v e r y s c e p t i c a l a b o u t w h e t h e r t h a t c o m p a n y w a s 16 e v e r se t u p a n d I a m m y s e l f now. 17 c o u l d h a v e b e e n i n N o r t h e r n I r e l a n d or B r i t a i n , 18 he d i d n ' t u s e a n o n - r e s i d e n t a c c o u n t , 19 u s e d a n o v e r s e a s a c c o u n t o f CRH. 20 50 Q 21 A The CRH s u b s i d i a r y but I t h i n k he C an you e x p l a i n h ow the m o n e y a r r i v e d to you? Yes, I can. 22 23 24 25 26 27 28 29 , a n d I s u g g e s t e d that he w o u l d p a y this in instalments over a c o uple of years, 1988/89, instead 1 of a l l i n o n e go. He s a w n o p r o b l e m i n t ha t . As 2 under s t o o d the arrangement, 3 w a s d i s p e n s i n g to me. 4 arrangement. 5 a n d t h e f i n a l p a r t of it w o u l d h a v e b e e n i n e a r l y 6 1991, 7 £120,000. I it w a s C R H m o n e y t h a t he He w a s q u i t e h a p p y a b o u t t h i s So I g o t it f r o m h i m i n i n s t a l m e n t s so i n 1 9 8 8 - 1 9 9 0 a n d e a r l y 1 9 9 1 I g o t t h e I w a s d i s t r i b u t i n g m o n e y to 8 9 Over 10 the same p e r i o d of 1 988-1991 11 a b o u t £ 1 4 0 , 0 0 0 t o them, 12 money. I myself distributed so I d i d n ' t e a r m a r k t h e 13 14 T h e n I w a n t e d to 15 make a bsolutely sure that there was d o c umentary 16 e v i d e nc e that t h e y got the CRH money, 17 e n d of 1 9 9 0 a n d e a r l y 1 9 9 1 I i n v e s t e d s i x b y £ 2 0 , 0 0 0 18 in s a v i n g s c e r t i f i c a t e s , 19 r e f e r r e d to. 20 instalments. 21 51 Q. 22 A. 23 52 Q. 24 A. 25 It w a s Mr. 53 Q. 27 A. the y are the ones T h a t w a s t h e way, I it w a s p a i d to m e in Traynor himself who gave you the money? At all times. By c heque or b a n k draft? It w a s m a i n l y c a s h b u t t h e r e w e r e at l e a s t t w o b a n k drafts that 26 so b e t w e e n t h e I r e m e m b e r t h a t h e g a v e me. C a n you r e c o l l e c t what b a n k t h e y w e r e d r a w n on? I h a v e a n i d e a it w a s B a n k o f I r e l a n d b u t I c a n ' t b e 28 certain. I didn't t hink there was a n y t h i n g wrong 29 w i t h t h i s a n d I a m s i t t i n g h e r e a n d I k n o w it l o o k s 1 awful. 2 We are o nly a sk i n g you q u e s t i o n s b e c a u s e you v e r y 3 p r o p e r l y r a i s e d it y o u r s e l f . 4 Justice Costello 5 A n s b a c h e r account, 6 e n q u i r i e s to l o o k i n t o it. 7 A If it is as Mr. e x p l a i n e d to you, if it is an t h e n it is r e l e v a n t t o o u r I h a v e n o e v i d e n c e w h a t s o e v e r t h a t it w a s n o r s h o u l d 8 it h a v e b e e n b e c a u s e it w a s n ' t m y m o n e y , it w a s 9 C R H ' s m o n e y c o m i n g b a c k w a r d s a n d t h e r e was no tax 10 a d v a n t a g e b e c a u s e it w a s e x p l a i n e d t o m e t h a t t h e s e 11 w e r e g i f t s t h a t w e r e p e r f e c t l y i n or d e r , 12 it d i d n ' t o c c u r t o m e t h e r e w a s a n y t h i n g w r o n g . 13 MS. MACKEY: V e r y good , 14 15 much, 55 Q MR. JUSTICE COSTELLO: 16 Mr. therefore, thank you very Culliton. Just one p o i nt I would l i k e to c l a r i f y w i t h you, 17 Mr. 18 a b o u t Mr. 19 M a n a g i n g D i r e c t o r of G u i nness M a h o n and became 20 C h a i r m a n of Cement Roadstone, 21 you the i m p r e s s i o n that he still h a d c o n n ec t i o n s 22 with Guinness Mahon. 23 A 24 56 Q 25 Culliton, in r e l a t i o n t o y o u r u n d e r s t a n d i n g T r a y n o r ' s r o l e w h e n h e c e a s e d t o be you said that he gave Yes . Did you know that Guinness Mahon had overseas subsidiaries ? 26 A 27 57 Q T hey were a London company. Yes, and the Irish c o m p a n y was a s u b s i d i a r y of the 28 Lon d o n company. 29 Yes. He d i d n ' t just give the im p r e s s i o n , 23 he w o u l d 1 h a v e t o l d u s t h a t it w a s j u s t a c h a n g e of r o l e f o r 2 him. 3 Mahon overseas but 4 international bank with branches. 5 58 Q. I didn't So y o u d i d n o t know all that m u c h about Gu i nn e s s I a s s u m e d t h e y w e r e an know that Guinness Mahon Ireland had 6 in fact its ow n s u b s i d i a r i e s 7 and in the Caymans? 8 9 10 A. No, I didn't k n o w t h at. MR. JUSTICE COSTELLO: 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 I knew they were a branch Yes, Mr. v e r y m u c h for your assistance. 13 14 Islands of t h e L o n d o n G u i n n e s s M a h o n . 11 12 in t h e C h a n n e l END OF INTERVIEW I see. Culliton, V e r y w ell, thank you 0/70 0.. 96033 IV .0 35105 ltauH ndi 1 TJbuht i IW M M IL I S E V IH 1 S IX 1/6- . ...... "** 4 r s i R E O S * ;*iaM ■' * £ *“ ‘ mi. T a g i s a a l s a ^ ..................... - ~00 ?9/105: 1 HriM&Hoaa, t9 ff\ 8t>t a t M Crum MMn t IWi (SS3J) 47KMH. fen CU311 47tQ324> P.P.L 19 Hefc eeNN*eme*ls Solicitor* yvwrrtA aJOEM/QS The Inspectors Jtiuiaiy 3000 a appointed by Order of the High Court of Anabacher Cayman Ltd., Third Floor, Trident House, Blackcock, CO. DUBLIN. R*: inapeotorsappointedto Ansbachsr Cayman Ltd.. Our ottant: J.P . Cuttton Esq., Dear Sira, W e act on behalf of P. Culliton Esq., of Traaaoapa, Faasaroa, Bray, Co. Wicklow and w e refer to your letter of tha 21" Decamber 1?*8 addressed to our client. Our oliant wishes to co-operate fully with you In tha course of your inquiry and hereby replies to the question raised at Appendix C of your letter aa follows; *(1) Not applicable - (Cayman Island Trusts and Trust companies)*. *(2) Th a uaa of Deposits maintained by Irish Residents with the company " “ (a) J.O . Traynor Managing Qicector . Guinness and Mahon Ltd., Trinity Street, Dublin 2 . A t no stage did I enter into e formal agreement, sign an application form or receive any statements, receipts or letters in connection w ith this deposit. It is possible, although I do not recall this, that J .D . Traynor at m y requeat could have given ma a hand written note of the balance on deposit. However this account waa closed 13 years ago and t have no correspondence or notes." "(b) First availed o1 in 1979 (to the beat of my recollection) and between that data and 1986/87 amounts ware put in and taken out on an occasional basis." He) Exclusively with J .D . Traynor, usually at hie office at Guinness & Mahon Trinity Street." “ (d) 1 always contacted J.D . Traynor, he usually handed me tha money at his bank but occasionally he left it In a seated envelops with his secretary Ms. J . William a to give to me.* J,A.fflatHu,H.*.I-ODaMril,*.f.fcnliMVS.u.»«*kA.M*Hd* 1 1/ 0" • « 09:32 GERRRPD SCflLLflN & O' BRIEN •> HQ.5 8 6 *(«! Nottomy knowledge" ®{fj I am not aware of in y coda, all my dealing* with the bank were dkectty with J.D. Traynor.* ~ *(3) did not avail erf any service Involving Irish Igtaroontinomat Bank Ltd., Amiens Securities Ltd.. Amiens investments Ltd., oFKant Ford Becuritlee Ltd.. *(41 t did not at any stage have toan and guarantee facWtlea with Guinnesa ft Mahon (Ireland) Ltd., nor d d I have • loan at any time.* ^ “(B) I did not at any etaga have toan and guarantee facWtiee with any of tha bank* Isted in no. 8 nor dW i have a loan at any time.* *181 did not apply under tha Exchange Control Act* for permission In relation to my deposit with Guinneae ft Mahon. I w u deaRng directly with the menegtng director of Qulnnees Mahon, Ireland's oldeat Mswhent Bank end In 1878 I would have assumed he would have taken care of aH legal requirement*. At noatage dW J.D . Traynor raise any cttfflcuhbw with me.* '(7J, (81. did not avail of any of these servteea directly or Indirectly.'' "9. I have no additional Information or documw...^. 'w d a or conreepondenoa In relation to these matters'. Our client haa instructed us In relation to a matter which, although not covered by the questions raised by you it la felt should nevertheless ha disdoaed and accordingly states as follows: *ln November 1987 when I was stepping down as Chief Executive of the CRH Group I was Informed by the late Mr. J.D. Traynor, tha then Chairmen, that would be paid a gift of £20,000 from a non-feeldent company In the Group. He advised me that as the donor wee not Irish domiciled and the property In tha gifts waa not Irish property, there was no Bebittty to irfeh gift tax. On thst bests no gift tint returns were lodged. I am bringing this transaction to your attention because it waa initiated by the late J.D. Traynor and i believe that the monies were received from an off-shors account during the period 1988 - 1981." We «ha\\ revert to you in relation to arranging a data for examination under Oath. Yours faithfully, GERRARD. SCALLAN & O'BRIEN. 003 Appendix XV (25) Dr Michael Dargan 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Dr Michael Dargan. a) Facsimile of 21 February 1990 from JD Traynor to Guinness and Mahon. b) Letter of 22 February 1990 from Guinness and M a h o n to JD Traynor. c) Guinness and M a h o n credit application of 23 February 1990. d) Letter of 15 March 1991 from Ansbacher Ltd to IIB. Correspondence received from or on behalf of Dr Michael Dargan. a) Letter of 31 August 2001 from M c C a n n Fitzgerald to Inspectors. b) Letter of 3 October 2001 from M c C a n n Fitzgerald to Inspectors. c) Letter of 8 November 2001 from M c C a n n Fitzgerald to Inspectors. 0! c'UC’Zr T*. 7IIB144/7A.10A5 Facaimih*' (t17035 4 2 F IT Z W IL L IA M $ Q U a . „ D U B L IN 2 i - A r . ‘' ; i M r r . F Tor ' G uinness •«. M; » h o t : A t t e n t i o n i M r. ............................. . i?i o m £ Ue^r M. E’**- Wo.- r.t.d. I.nn irjn n O 'K e e ffe . P?.?.*:. To ta I *. ? ■ . TrAynr.r. 72064? F eb ru atv ‘ Nr>. 19 9 0 . Paq^a (incl. this sheet): . M.irt. j c , H erew ith copy o! O uoiT inf l s o h erew ith i s « .« n i s i f l f . j v < - l «> t l i * g o o * } A i co n firm ^•"S ep arately T s h a ll lo u rs t r a n sm is s io n be w ith in a d d i t i o n a l sta n d in g l e t t e r w hich l » re q u ire d o f M iohaol D argan. A nstM frher w i l l p l a c e y o u hmI d o w h a t e v e r 1 li e s in t'rj« * ly / o T fir.? u n til 7 .3 0 a p p ro p ria te funds sig n in g w ill be needed. p .m . at 763065. Dear Mr.^Traynor, i■: » - ■ \ >. I r e f e r - i p t h e above m a t t e r and y o u r d is c u s s io n s w i t h M a r t i n L a n ig a n -O .V K e e ffe and c o n fir m t h a t we h a ve is s u e d t o IP PA Bank S .A . t h e fG u a r a n t e e a s r e q u e s te d . * " ..''£&&&' ** I e n c lo s e t'a c o p y - o f t h e C o u n te r In d e m n ity w h ic h we w i l l r e q u ir e A n s b a c h e f'6 V Company L im it e d t o s ig n i n r e s p e c t o f t h e G u a ra n te e . Y o u rs s i n c e r e l y , >. f• o r GOIHKSSS fi MAHON L IM IT E D . - •• ■ *—V . ■ • • • G .& M . D u b l i n ee M in u t e N o : . *A p g if lT f t f r f f iiT " 19 / V NEW /REMgW Xg/ZM eRgAgg/RBBM CTZ0H/XM gKBMBOT: BORROWER/OBLIGOR: B ru g m an H e i g h t s AMOUNT: G u a ra n te e - t. . : *% ‘^ " “C R H f t T T t M M i M y U n it: .„ . P B .F r . D a te : • ' ' ^ ^ C r e d it C la s s : ^ S a tis fa c to r y SA 1 ,8 7 5 ,0 0 0 p lu s in te r e s t (c . IR £ 3 4 ,1 0 0 ) PROPOSAL & PURPOSE OF F A C I L I T Y ( S ) : G u a r a n t e e i s s u e d i n f a v o u r o f IP P A B a n k SA on b e h a l f o f B ru g m a n H e i g h t s SA. P a r t o f £ 6 m . f a c i l i t y b e in g p r o v i d e d t o Bjrugman H e i g h t s S A . S o u r c e o f R e p a y m e n t, R e p a y m e n t P rogram m e & F i n a l M a t u r i t y : N /A 3 Y e a rs 2 2 .2 .1 9 9 3 B a n k 's In c o m e ( i n c l u d i n g R e t u r n o n C a p i t a l ) : Fee £500 p .a . ROC **7 . ■N_________ ' ______________________________________________ _________________________________ o '- '- . u r i t y a n d S e c u r i t y M a r g i n : ..i n t e r - i n d e m n i t y fr o m A n s b a c h e r & C o . L t d . O th e r C o n d itio n s P re c e d e n t: O th e r In fo r m a tio n : B A N K 'S R IS K EXPOSURE - A g g re g a te C u s to m e r ( i n c l u s i v e o f t h i s p r o p o s a l) R e l a t e d C u s to m e r to : T o ta l — B . F r . 1 ,8 7 5 ,0 0 0 C o m m itte d /L im it: ^ B . F r l , 8 7 5 , ,0 0 0 B a la n c e : — C o u n try R is k : C o u n t r y o f P r im a r y R i s k : B e l g i u m P r im a r y R is k : L i m i t : Commt: S e c o n d a r y R is k :C a y m a n I s l a n d s D o m ic ile :B e lg iu m D ra w n : c :to r R is k : GM B u s in e s s S e c t o r : P r o p e r t y o ^ c to r: L im it: C B o f I B u s in e s s S e c t o r : 7 1 0 Commt: R is k A s s e t W e ig h tin g : 0 . 5 D ra w n : Recommended b y : J . R y a l l In tr o d u c e d b y : J .D . T ra y n o r D e c is io n : r J ti C r e d i t J C o m m i t t e e C h a ir m a n M in u te N o: M in u te No: D u b lin /C C B o a rd D a te : GM&Co. D a te : l A Member of tht Htnry Ansbachtr Holdings PLC Merchant Banking Group Please replyto: 42 Fitzwilliam Square, Dublin 2. Tel:765144/763065 Fax: 612035 p,a Box M7, G,lnd Brash w«« India (*W)949-7946 (809)949'5267 1 5 t h M a rc h , G a r r e t t L o g a n , E s q ., I r i s h I n t e r c o n t i n e n t a l Bank L i m i t e d , 91 M e r r i o n S q u a r e , DUBLIN 2 . 1991. . Dear G a r r e tt, C o u ld y o u p l e a s e a r r a n g e t h e I R £ 2 8 ,0 0 0 fo llo w in g tra n s fe rs ; t o U l s t e r Bank O 'C o n n e ll S t r e e t D u b lin F o r A ccoun t N o .2 00 8 91 2 8 i n t h e name o f M .J . D a r g a n . IR E 1 0 ,0 0 0 t o Bank o f I r e l a n d D u b lin A i r p o r t F o r A ccount N o .20508442 i n th e name o f M .J . D a rg a n . P le a s e d e b i t t h e N o . 0 2 /0 1 0 8 7 / 8 1 5. c o s t o f each t r a n s f e r to o u r C a ll A ccount I t w o u ld be a p p r e c i a t e d i f you c o u ld a d v is e a m o u n t d e b i t e d as soon as p o s s i b l e . Y o u rs s in c e r e ly , - :On'c 1r IJ3 & — th e S t e r lin g ft ---- - J F o r AMS3ACH5R L IM IT E D uU 2 Harbourmaster Place , ,ternational Financial Services Centre Dublin 1 £ " S I S Z! M c C a n n FitzGerald email: postmaster@mccannfi tzgeraId. ie website: http: / /www.mccannfitzgerald.ie SOLICITORS Dx 31 Dublin our ref DJCV264087.6 your ref date 31 August 2001 The Inspectors Office of the Inspectors 3rd Floor Trident House Blackrock C o Dublin Dr Michael J Dargan Inspectors, W e refer to your letter to D r Dargan of 1 August notifying him of an intended finding that “D r Dargan was a client o f Ansbacher” . A s you surmise, this finding could clearly be adverse to our client’ s interests and reputation. W e have in our letter of 17 August already advised you that D r Dargan wishes to m a k e submissions as to w h y no such finding should be made. W e do not believe that the Inspectors proposed finding is justified on the evidence which is identified in your letter and w e apprehend that there is a considerable risk that if such a finding were m a d e b y the Inspectors in any report of theirs then inferences would be drawn from it which would also be unjustified. 1. Not a Client 1.1 W e do not k n o w what criteria the Inspectors intend to apply for the purpose of identifying a person as a client of the company. O n e generally speaks of a bank as having customers rather than clients. T he term client normally connotes a person w h o is receiving professional services. Banking services are not generally so characterised and the Inspectors’ proposed characterisation of D r Dargan as a client accordingly implies or will be taken to intend to imply that he has received services from the c o m p a n y which are distinguishable from characteristically banking services. The notice does not identify what these services are thought to have been. Ronar>Molony, MichaelV.O'Mahony, RichardRice, FergusArmstrong. DavidClarke, GeraldFiaGerald, DaireHogan, GuyFrench, HenryLappin. MichaelS.Roche, ColinKeane. WilliamEarley, Robert8urke, PetriaMcDonnell, Timothy8ouchier-Hayes, HelenCollins, GeraldB.Sheedy, MarkPearson. MichaelO'Reilly. LonanMcDowell. PatriciaT.Rickard-Clarke, MichaelO’Brien. JulianConlon. DamianCollins. JohnCronin. VivienneBradley. CatherineDeane, PaulHeffernan, BarbaraJudge. MichaelKealey. TerenceMcCrann, UltanStephenson, MurielWalls. RoderickBourke, GraceSmith, AmbroseLoughlin. NiallPowderly, KevinKelly, HilaryMarren, DeniseO’Connor, EamonnO'Hanrahan, RoyParker, PatriciaLawless. BarryDevereux, GeraldineHickey. HelenKilroy, JudithLawless, JamesMurphy, DavidLydon, VanessaFitzGerald, DavidByers, SeanBarton, HannahCarney. ColmFanning, PaulLavery, YvonneMcNamara. SusanO'Halloran, JulieQuin. Consultants:MaxW.Abrahamson. BrianMcLoghlin, JaneMarshall. MichaelRyan(FCA). GarrettFennell. O f C o u n s e l (U S A ): WilliamP.Clark. Belfast;NorthSouthLego/Af/iancewithL‘ Estrange&Brett,A r n o tt H o u s e , 1 2 -1 6 BridgeStreet,Belfast B T I IL S , T e l * 4 4 -2 8 -9 0 2 3 0 4 2 6 , F a x + 4 4 -2 8 -9 0 2 4 Brussels:AvenuedeCortenbergh89,Kortenbergfoon,1000Brussels,Tel+32-2-7400370,Fox+32-2-7400371. London;StM ic h a e l’s H o u s e , I G e o rge Yard, Lo m b a rd Street, Lond on E C 3 V 9 D F , T e l +4 4 -2 0 -7 6 2 1 1 0 0 0 , F a x +4 4 -2 0 -7 6 2 1 9 0 0 0 . NewVorJc 156West56thStreet,NewYorkNY 10019,Tel+1-2/2-2371 0 7 8 , F a x + 1 -2 1 2 -2 6 2 I 2 I S . 6396 1.2 W e assume that the services which the Inspectors consider merit this usage are those of the type which they indicated to D r Dargan that they were inquiring into and which are particularised in Appendix C of the Inspectors’notice to D r Dargan dated 21 Decem b er 1999. There is no evidence that D r Dargan ever sought or received such services from the company. H e has denied it absolutely and it is fair to say that the Inspectors, w h o at the time they interviewed h i m k n e w in detail of what his evidence would be, barely put to h i m the possibility that he had received such services. They did not put to him at all any suggestion that the documents identified in the Inspectors’notice of 1 August demonstrated that he had done so. There is nothing in the documents that in a ny w ay suggests that he received such services. The mere having of an account with the co m p a n y (even if D r Dargan had had such) clearly would not demonstrate this while the transactions to which the documents relate did not attract any liability to tax or, accordingly, suggest that any association which D r Dargan might have had with the co m p a n y could have related to the evasion of taxes. W e will submit in section 2 below that the evidence comprised in the documents referred to could not justify the Inspectors in concluding that D r Dargan had any contractual or consensual arrangement with the company. Those submissions will support the submission m a d e here, although in our view the submission here m a d e does not require any further support. 1.3 W e therefore submit that there is no evidence upon which the Inspectors could reasonably conclude that D r Dargan w a s a client of the C o m p a n y as w e understand that term. 1.4 If w e misunderstand the criteria which the Inspectors’intend to use so as to characterise a client of the company, w e must ask that the Inspectors tell us of what their criteria are and of whereabouts they have indicated to D r Dargan that they have been concerned to establish that such other criteria apply to him. In the same context, w e must also ask that the Inspectors tell us whether and if so h o w they propose to separately characterise any persons w h o m they m a y be minded to find did receive services of the type particularised in Appendix C. Having received that information w e will be in a position to m a k e appropriate submissions to the Inspectors in the light of the criteria they actually attach to the term client. It will be appreciated that without such information w e could not readily do so. 2. No Consensual Relationship 2.1 W e do not believe that the evidence identified b y the Inspectors could justify them in concluding that D r Dargan had any contractual or consensual relationship with the company. The Inspectors’notice of 21 December 1999 did not concern itself with any relationships with the c o m p a n y other than these particularised in the notice. O n reviewing the transcript of D r Dargan’ s interview, w e do not recognise any questions designed to establish the existence of any other identifiable relationship which D r Dargan might have had with the c o m p a n y or any significance which the Inspectors regarded such relationships as having for the purpose of their inquiries. If the Inspectors are concerned to identify persons w h o might have had relationships with the c o m p a n y other than those of the type particularised in the Inspectors’ original notice, w e would be grateful to k n o w h o w the Inspectors define such relationships and w h y they regard these as relevant to their inquiries. W e would wish to try to address any argument that D r Dargan had such a relationship with the company. 2.2 Even in the absence of that clarification however, w e submit that while the evidence identified b y the Inspectors might justify inquiry as to whether any consensual relationship existed between D r Dargan and the co m p a n y (were such inquiry germane to the Inspectors’ work), there is no reliable evidence or , alternatively, it would be entirely against the weight of the available evidence for the Inspectors to conclude that such a relationship existed. 2.3 The only evidence which it is suggested demonstrates any connection between D r Dargan’ s affairs and the business of the c o m p a n y consists of copy written material recently obtained by D r Dargan from third parties and produced by h i m to the Inspectors. D r Dargan has explained that he was not privy to the creation of the original of any of this material and that he had not been aware of its existence until he obtained it in the w a y described. W e are aware of no evidence suggesting that he has been mistaken on either point. Th e documents do not express D r Dargan to have been a client or customer of the c o m p a n y and D r Dargan has explained to the Inspectors the transactions to which the papers appear to relate and which did not involve the c o m p a n y in any w a y which would justify a finding that he was its client or customer. There is no evidence from anyone actually privy to the creation of the documents supporting any different view. 2.4 Treating of the facts in m or e detail - in respect of the B r u g m a n guarantee, D r Dargan did not discuss or m a k e any arrangements for the, provision of any security to Guinness & M a h o n and k n e w nothing about what it seems was M r Traynor’ s agreement on behalf of the c o mp a ny to provide a matching guarantee to Guinness & Mahon. The documents do not m a k e (and possibly carefully avoid) any assertion that D r Dargan w a s associated with the c o m p a n y or that the co m p a n y held any funds to which he was entitled, while a bank guarantee does not of course entail the holding of matching funds b y the tendering bank. Unless there be other evidence to support a different inference, the Inspectors cannot justifiably reject D r Dargan’ s evidence and must, on the contrary, accept the obvious alternative - that the material reflects a private arrangement between Guinness & M a h o n and the company. It is entirely plausible that M r Traynor was using what appears to have been his authority in both Guinness & M a h o n and in the co m p a n y to provide the guarantee which D r Dargan had requested and to provide comfort to Guinness & M a h o n - perhaps merely for the record or perhaps for the purpose of conforming to regulatory-informed requirements affecting Guinness & Mahon. 2.5 In respect of the transfer of the funds which were lodged with accounts in B a n k of Ireland and Ulster B a n k and, again, in the absence of any evidence suggesting the contrary, the Inspectors have no reason not to accept that these represented the proceeds of the sale of a racehorse in the U S and that the transfer of them from the U S was probably arranged through the c o m pa ny as the most convenient w a y of effecting the transfer. T h e passage of funds through a bank does not entail the existence of any consensual arrangement between the bank and the owner of the funds. D r Dargan says he did not instruct the c o m p a n y (or IIB) for this purpose and had not been aware that either had been involved. (It would not seem to matter whether D r Dargan did b ec o m e so aware, for it is unlikely that at that time such involvement would have been of significance to h i m even if he had c o m e to k n o w of it). 2.6 The Inspectors have not found any evidence suggesting that these explanations are wrong or mistaken. They were certainly not challenged w h e n D r Dargan gave evidence. 2.7 Neither the two sets of documents nor the transactions to which they relate indicate any link with one another, nor therefore does one serve to reinforce any arguement from the other of there having been any different relationship between the c o m p a n y and D r Dargan than that evident from D r Dargan’ s o w n evidence - namely, that he looked to M r Traynor on occasion to deal with matters of these kinds. 2.8 The preliminary text in the Inspector’ s current notice refers to the fact that D r Dargan has acknowledged that he has a poor memory. M a n y people do. There is nothing in D r Dargan’ s evidence which suggests that he is uncertain as to the evidence he has given or which would justify the Inspector’ s discounting his evidence in favour of a contrary hypothesis which has no independent support and of which, no one has any recollection. 3. Statutory Objects o f the Investigation 3.1 At section 1 above w e submitted that there w as no evidence before the Inspectors on the basis of which they could find that D r Dargan was the c o m p a n y ’ s client nor any evidence or any satisfactory evidence that he was the c o m p a n y ’ s customer. If, on review, the Inspectors accept our submission that D r Dargan ought not be identified as a client, or as having had any other consensual relationship with the c om pa n y in respect of which any finding requires to be m a d e b y the Inspectors, the submission which follows m a y be treated as otiose. 3.2 Otherwise however, and without prejudice to D r Dargan taking other courses which m a y be open to h i m in those circumstances, then w e have to challenge the extent to which (if at all) the Inspectors are properly concerned or entitled to m a k e findings or report as to the identities or other characteristics of individual clients or others dealing with the company. 3.3 Section 8 of the Companies Act 1990, under which the Inspectors have been appointed, is applicable only in such circumstances as are described in that section and (we believe it is clearly to be inferred) only for the purpose of reporting upon the matters constituting those circumstances. These relate entirely to the conduct of the c o m p a n y itself and of “persons connected with its form ation or the management o f its affairs” . Undoubtedly, in carrying out their functions, inspectors appointed under the section m a y need to scrutinise the relationships and business had between a co m p a n y and anybody dealing with it. O n the other hand, the section does not authorise inspectors appointed under it to investigate or report upon such persons themselves unless those persons have been concerned with the c o m p a n y ’ s formation or the management of its affairs or except, perhaps, to such extent as such persons m a y be so intimately involved in the c o m p a n y ’ s o w n business as to require such treatment. 3.4 In principle there seems no reason w h y the Inspectors in this case should have to identify or otherwise report upon any persons unless they were concerned with the formation or management of the c o m p a n y ’ s affairs and there is nothing in the Inspectors’proposed findings notified to D r Dargan which suggests any such reason in his case. 3.5 Since in principle the relationship between a bank and its customers has always been regarded at C o m m o n L a w as confidential, clear legal authority and need ought be a prerequisite to any disclosure relating to the existence or terms of such relationships in the present case, even did the statute confer a discretion to inquire into or disclose the identity of such persons. Furthermore, where rightly or wrongly this c o m p a n y is n o w notoriously associated with the evasion of tax, the making or publication of any finding b y the Inspectors that any person was associated with such a c om pa n y would inevitably imply for anyone receiving the Inspectors’report that such a person also was or m a y have been involved in such activity. Indeed the statements preliminary to the proposed finding relating to D r Dargan’ s prominent position in working life (as well as, incorrectly, to his having had an account with the company) must be intended to invite the reader to form so m e connection between those facts and whatever is to be found as to the c o m p a n y ’ s business - the Inspectors clearly do not consider that there is value or need to provide a simple list of people with whose affairs the c o m p a n y has been found to have some connection. There is no evidence at all which would justify the making of a finding in respect of D r Dargan suggesting that he did or might have sought to evade taxes. Particularly^ having regard to these circumstances, D r Dargan is entitled that his good n a m e be protected having regard to his rights under Article 40.3 of the Constitution and that the Inspectors do not proceed to m a k e findings outside of the objects of section 8. 3.6 W e are conscious that the Order m a d e in these proceedings on 22 September 1999 appears to place a duty upon the Inspectors to ‘‘identify as fa r as possible a ll o f the parties 1 who were either officers (including shadow directors) and agents o f the Company clients o f the Comvanv or who otherwise assisted in the carrying out o f the business at the relevant time In their context, the words which w e have underlined appear intended to be construed ejusdem generis with the words both before and following them, which relate to the activity of the c o mp an y as such and its management. It m a y have been submitted to the Court that som e or all of a class of persons characterised as clients of the c o m p a n y were involved to such an extent in the affairs of the c o m p a n y as to be properly regarded as having been concerned with its establishment or the management of its affairs. ( W e have not yet been able to obtain access to the evidence presented to the Court which might assist in explaining the form in which the Order w a s made). Clearly, D r Dargan could not fall into such a category. In the light of what is said above, w e submit that it is incumbent upon the Inspectors to consider the effect of the Order in the context of the statutory provisions under which it was made. If the Inspectors reach the conclusion that it entitles them to m a k e findings in respect of D r Dargan notwithstanding that they have not concluded that he was connected with the c o m p a n y ’ s formation or the management of its affairs, then w e suggest that in a matter of such consequence and having regard to the terms of the section, the directions of the Court should be sought as to the extent to which the making or reporting of such findings are permitted b y the section or Order. Yours faithfully David Clarke M c C a n n FitzGerald Direct D ial: +353 I 607 1290 Email: david. clarke@mccannfitzgerald. ie 2 Harbourm aster Place ft) International Financial Services Centre D u b lin 1 Tel +353-1-829 0000 M c C a n n FitzGerald Fax +353-1-829 0010 SOLICITORS email: postmaster@mccannfitzgerald. ie website: http://w ww .m ccannfitzgerald.ie D x 31 D ublin °“rref djc\286908.i y° urref 3 October 2001 The Inspectors Office of the Inspectors 3rd Floor Trident House Blackrock C o Dublin Dr Michael J Dargan Inspectors W e refer to your letter of 1 August and to our letters of 17 and 31 August in connection with the inquiries being conducted by you and a finding which you have proposed to m a k e affecting D r Dargan. Y ou r solicitor has orally confirmed receipt of our letter of 17 August but w e have had no written acknowledgement of receipt of it or any acknowledgement of our letter of 31 August. W e would be grateful to have a written acknowledgement from you of receipt of both letters. F r o m your letter of 1 August (as amplified in a subsequent telephone conversation with your solicitor), w e understood that the Inspectors’immediate concern w a s to k n o w w h o m of the persons they were addressing wished to have an opportunity of replying to the findings which the Inspectors were proposing to m a k e and that the Inspectors would thereafter establish arrangements and a timetable in respect of such proceedings. W e understood that it was intended that these arrangements would be decided upon and advised to us in early September, w h e n the Inspectors had an opportunity of meeting following the vacation period. O u r letter to the Inspectors of 31 August constitutes a reply to the proposed findings which is provisional upon our being correct in our understanding, first as to the meaning which the Inspectors are attributing to the term ‘ client’ , and then as to other matters which in logical sequence m a y fall to be addressed if the Inspectors’interpretation of the term differs from ours. A s the Inspectors are aware, D r Dargan is an elderly man. His recent health has not been good and on his behalf w e therefore share the concern expressed in the Inspectors’letter RonanMolony, MichaelV.O'Mahony, RichardRice, FergusArmstrong, DavidClarke, GeraldFitzGerald, DaireHogan, GuyFrench, HenryUppin, MichaelS.Roche, ColinKeane, WilliamEarley, RobertBurke. PetriaMcDonnell, TimothyBouchier-Hayes, HelenCollins, GeraldB.Sheedy, MarkPearson, MichaelO'Reilly. LonanMcDowell, PatriciaT.Rickard-Clarke MichaelO'Brien. JulianConlon, DamianCollins, JohnCronin. VivienneBradley, .CatherineDeane. PaulHeffeman, BarbaraJudge, MichaelKealey, TerenceMcCrann, UftanStephenson, MurielWalls, RoderickBourke, GraceSmith, AmbroseLoughlin, NiallPowderly, KevinKeliy, HilaryMarren, DeniseO’Connor, EamonnO’Hanrahan, RoyParker, PatriciaLawless, BarryDevereux, GeraldineHickey, HelenKilroy, JudithLawless. JamesMurphy, DavidLydon, VanessaFitzGerald, DavidByers, SeanBarton, HannahCarney, ColmFanning, PaulLavery. YvonneMcNamara, SusanO’Halloran, JuiieQuin. Consultants:MaxW.Abrahamson, BrianMcLoghlin, JaneMarshall, MichaelRyan(FCA), GarrettFennell. OfCounsel(USA):WilliamP.Clark. B elfast: North South Legal Alliance with L‘Estrange &Brett, Arnott House, 12-16 Bridge Street, Belfast BTI ILS, Tel *44-28-9023 0426, Fax *44-28-9024 6396 Brussels; Avenue de Cortenbergh 89. Kortenbergloon, 1000 Brussels, Tel *32-2-740 0370, Fax *32-2-740 0371. L o n d on : S t M ichael's House, I G eorge Yard, Lombard Street London EC3V 9DF, Tel *44-20-7621 1000, Fax *44-20-7621 9000. s ° o M c C a n n FitzGerald SOLICITORS of 1 August that this matter should proceed with reasonable dispatch. If the assumptions expressed in our letter of 31 August are incorrect therefore, w e would be grateful to hear from the Inspectors and would be grateful to k n o w what arrangements and timetable they are proposing to adopt in respect of their further proceedings if these m a y affect D r Dargan. Yours faithfully David Clarke M c C a n n FitzGerald Direct D ial: +353 I 607 1290 Email: david. clarke@mccannfitzgerald. ie A I if 2 Harbourm aster Place International Financial Services Centre D ublin 1 Tel +353-1-829 0000 M c C a n n FitzGerald Fax +353-1-829 0010 email: postmaster@mccannfitzgerald. ie website: http: / / umw. mccannfitzgerald. ie D x 31 D ub lin ourref SOLICITORS 1 ? ’■ W 1,'- - ' d j c \263036.i your ref date 8 N o v e m b e r 2001 The Inspectors Office of the Inspectors 3rd Floor Trident House Blackrock C o Dublin Michael Dargan /Ansbacher Inspectors Inspectors W e acknowledge receipt on 22 October of an undated letter from you, the envelope of which is franked 19 October. W e acknowledge also the ‘ definition of a client’attached to your letter. 1. Not a Client ■ 1.1 O u r immediate purpose is to ensure that w e have addressed the criteria which the Inspectors have applied, w e believe mistakenly, in forming their preliminary conclusion that D r Dargan has been a client of the company. Having regard to the definition n o w provided and to paragraph 2 of the ‘ Inspectors’Preliminary Conclusions’sent to D r Dargan with your letter of 1 August, w e understand these conclusions to be based upon a preliminary finding of fact that D r Dargan had ‘ an Ansbacher deposit’or ‘ an Ansbacher account’ . If the Inspectors were characterising D r Dargan as being a client on the basis only that 'business w a s carried out for’h i m by Ansbacher (a general criterion forming part of the definition provided), then w e would be grateful if the Inspectors would so advise us. 1.2 O n the assumption that w e are correct, then w e should respectfully point the Inspectors again to paragraphs 2.3 to 2.8 of our letter of 31 August. W e also have to point in particular to the following: (a) The documentary evidence upon which the Inspectors have proposed to rely does not demonstrate the existence of a ‘ deposit’or ‘ account’related to D r Dargan; the identified documents do not demonstrate the existence of any such account or RonanMolooy, MichattV.O'Mahony. RichardRice. FergusArmstrong, DavidCork*, GeraldFiaGeratd. DaireHogan, GuyFrench, Henrylappin, MichaelS.Roche, ColinKeane, WilliamEarley, RobertBurke, PetriaMcDonnell, TimothyBouchier-Hayes, HelenCollins. Ger?tdB.Sheedy, MarkPearson, MichaelO’Reilly. LonanMcDowell, PatriciaT.Rlckard-Clarke, MichaelO'Brien, JulianConlon, DamianCollins, JohnCronin, VivienneBradley, CatherineDeane. PaulHeffeman, BarbaraJudge, MichaelKealey, TerenceMcCrann, UltanStephenson. MurielWalls, Roderick8ourke, GraceSmith, AmbroseLoughlin, NiallPowderly, KevinKelly. HilaryMarnsn, Der.seO’ Connor. EamonnO’Hanrahan, RoyParker, PatriciaLawless. BarryDevereux. GeraldineHickey. HelenKilroy, JudithLawless, JamesMurphy. DavidLydon, VanessaFiaGerild. DavidByers, SeanBarton. HannahCarney, ColmFanning, ^ ^ PaulLavery. YvonneMcNamara, SusanO'Halloran. JulieQuin, ’ • iftr V • Coniultontj.-MaxW.Abrahamson. BrianMcLoghlin. JaneMarshall. MichaelRyan{FCA}, GarretiFennell, O f C o u n t* ! (U S A ): WilliamP.Clark. 377 IL S , T e l +4 4 -2 8 -9 0 2 3 0 4 2 6 , Fax +4 4 -2 8 -9 0 2 4 +3 2 -2 -7 4 0 0 3 7 1 . London;StM ic h a e l's H o u s e , I G e o rge Yard, Lo m b a rd Street, Lo nd on E C 3 V 9 D F , T e l +4 4 -2 0 -7 6 2 1 1 0 0 0 , F a x +4 4 -2 0 -7 6 2 1 9 0 0 0 . New York:tS6West56tbStreet,NewYorkNY10019,Te l + 1 -2 1 2 -2 3 7 1 0 7 8 , F a x +!-2 1 2 -2 6 2 12 1 5 . B e l f a s t : N o rth SouthL e ga l Alliance w ith L'E stran ge & Brett, A rn o tt H o u s e , 1 2 -1 6 Bridge Street, Belfast B r u s s e ls : A v e n u e d e C orte n b ergh 8 9 , Korte nb e rglaa n , 10 0 0 Brussels, T e l + 3 2 - 2 -7 4 0 0 3 7 0 , F a x 6396 ^ deposit and the terms of the preliminary conclusions do not indicate h o w the Inspectors find them to do so. (b) The documentary evidence indicate transactions which could justify the Inspectors in forming a hypothesis that such a deposit or account might exist. Acting reasonably however, the Inspectors could not conclude that such a hypothesis was correct without having regard to the availability of other evidence which, if the hypothesis were correct, ought be available to support it, (as well as, of course, any evidence available which contradicts the hypothesis). If such hypothesis were correct, one would expect other evidence supporting it to be available within the c o m p a n y or Guinness & Mahon. T h e Inspectors do not appear to have found such evidence or to have taken account of the implications of its absence; their preliminary conclusions do not record anything in relation to their having sought such evidence or any reasons for its absence. (c) The Inspectors do not appear to have had regard to the evidence of D r Dargan which contradicts the existence of an account or deposit, nor do they appear to have taken account of the absence of any evidence contradicting that which D r Dargan gave, (nor of the absence of any evidence contradicting D r Dargan’ s evidence that these explanations demonstrate that the documentary evidence does not disclose the existence of a deposit or account). It is submitted that the Inspectors do not in fact have any reason to discount D r Dargan’ s evidence; their preliminary conclusions do not disclose anything which does so - aside from the reference to D r Dargan’ s acknowledgement that he has a poor memory. T h e Inspectors’references to the documentary evidence and their omission to describe anything of D r Dargan’ s evidence would unjustifiably suggest that the documentary evidence conclusively establishes the existence of an account or deposit. (d) The Inspectors’preliminary conclusions expressly rely upon D r Dargan’ s statement in evidence that he has a poor memory, but it is not evident h o w this has assisted them in concluding that D r Dargan had an account or deposit with the c o m p a n y or was a client of the company. It is clear from D r Dargan’ s evidence (including what he said as to his m e m o ry ) that he recollects a good deal about the transactions which he w a s describing and there is no evidence to suggest that he is mistaken in the account he has given of either of the transactions. Since the transactions took place ten years previously and were not particularly important, the extent of his recollection of details seems creditable and the fact that he w a s unable to recall certain details of his conversation with M r Traynor, for example, could not justify the general discounting of the details he was able to provide about the transactions, and a fo rtio ri could not justify a conclusion that, despite his evidence, he had an account or deposit with the company. (e) Whatever m a y be the Inspectors’intention, w h e n read in conjunction with the Inspectors’expression of reliance upon the documentary evidence and their lack of reference to the evidence D r Dargan has actually given, the Inspectors’reference to D r Dargan’ s acknowledgement of a poor m e m o r y suggests that while D r Dargan has given evidence, this evidence is patently wrong and the Inspectors’dismissal of it by reason of ‘ poor m e m o r y ’reads as if the reason expressed is a euphemism. W e submit that the Inspectors would be quite unjustified in weighing the available evidence in the manner proposed, and there could be no justification for dismissing D r Dargan’ s evidence in the words expressed. 1.3 The above concerns are directed to the substance of the preliminary conclusions to the manner in which they appear to have been reached, the manner in which this reasoning and the conclusions are expressed and the inferences which are invited by this expression. It is submitted that on each count the Inspectors ought revise and reverse their preliminary conclusions. 2. Definition o f Client 2.1 Since the Inspectors have not indicated that they are reaching or expressing any general conclusion to qualify or explain the preliminary conclusions expressly referring to D r Dargan, w e submit that the making of any finding b y the Inspectors as to D r Dargan’ s identity on the basis that he is a client of the c o m p a n y cannot serve any useful or legitimate purpose w h e n the category of client is defined in the w a y n o w communicated b y the Inspectors. The only likely affect of making and reporting such findings is to imply that there is reason for supposing that the people n a m e d have or m a y have availed of services provided by the co m p a n y to assist in the avoidance of tax. E v en were it in principle appropriate for the Inspectors to m a k e or report such conclusions, there would be no justification for doing so in respect of D r Dargan. 2.2 The inappropriateness of forming or expressing such a conclusion about such a category of people and about D r Dargan in particular i§m a d e more apparent b y the fact that the Inspectors did not, on the face of their communications, carry out inquiries directed to identifying such an inconsequential category of people and it would give cause to doubt the objectivity and purpose of the Inspectors and be procedurally unfair for them to express this as having been a subject of their investigation. 2.3 W e therefore submit that the Inspectors ought not proceed on such a basis. 3. Statutory Objects o f the Investigation 3.1 The Inspectors’proposal for the definition of a client of the c om pa n y accentuates the importance of their addressing the submissions m a d e at section 3 of our letter of 31 August. 4. Generally 4.1 The advantage of an oral hearing ought be to enable the Inspectors and D r Dargan to clarify the matters which are actually persuading the Inspectors towards their preliminary conclusions so that these can be addressed. Since the Inspectors are declining to ‘ enter into any debate’in respect of their preliminary conclusions, w e understand them to be communicating that they are not prepared to do more than listen to what is said to them. W e agree that no useful purpose would be served by this. For the reasons expressed at 1.3 above, w e respectfully suggest that such while ‘ debate’is not necessary, clarification is still required. 4.2 W e request that the Inspectors advise us of the steps they propose to take next in respect of D r Dargan, that is to say, first, whether and, if so, in what form they propose to m a k e any finding that he is a ''client ’ of the c o m p a n y and second , as to whether they propose to apply to the court for directions in the circumstances and for the purposes expressed in section 3 of our letter of 31 August. W e also request to k n o w what submission they propose to m a k e to the court as to the publication of any part of their report relating to D r Dargan. Yours sincerely David Clarke M c C a n n FitzGerald Direct D ial: +353 1 607 1290 Email: david.clarke@mccannfitzgerald.ie Appendix XV (26) Mr Brian Dennis 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Brian Dennis. a) Transcript of evidence of M r Brian Dennis dated 28 March 2000. b) Statement of M r Brian Dennis of 22 February 2000. c) Letter of 11 March 1971 from Bank of Ireland to M r Brian Dennis. d) Extract from Report of Guinness and M a h o n to Central Bank of 30 April 1978. e) Internal Guinness and M a h o n m e m o of 31 August 1978 - P O ’ Dwyer. f) Bank of Ireland cheque of 4 April 1993 in favour of J D Traynor. g) Letter of 10 February 2000 to G M C T from Brian Dennis. h) Letter of 24 December 1986 from Michael Pender to B A Ursell. Correspondence received from or on behalf of M r Brian Dennis. a) Letter of 10 October 2001 from O ’ Higgins Solicitors to Inspectors. UNDER OATH ON TUESDAY, 28TH MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MR. BRIAN DENNIS Represented by: MR. JAMES F . O'HIGGINS JAMES F. O'HIGGINS & CO SOLICITORS 10 EASTMORELAND PLACE DUBLIN 4 WITNESS MR. B. DENNIS I EXAMINATION MS. MACKEY MR. JUSTICE COSTELLO 41 PAGE 40 50 1 2 3 4 MR. JUSTICE COSTELLO: 5 Will we start our interview Mr. Dennis? My 6 name is Declan Costello and on my right Ms. Mackey. 7 We are the Inspectors, two of the Inspectors, who 8 have been appointed by The High Court. 9 MR. DENNIS: Yes. MR. JUSTICE COSTELLO: I should explain, as I do 10 11 to other people who come 12 before us such as you, that this is not a Court. 13 is not a Tribunal. 14 interview under oath and we will ask you to take the 15 oath in a moment. It is an interview. It It is an 16 17 I should explain to you that if at any time in the 18 course of the interview you wish to consult your 19 solicitor to stop and consult, please let me know 20 and I will stop. 21 22 Similarly, if Mr. O'Higgins wishes us to stop so 23 that he can consult with you he can tell us so and 24 we will stop and you can then consult. 25 to consult your solicitor at any time. 26 MR. DENNIS: Yes. 27 MR. JUSTICE COSTELLO: I will ask now Ms. Cummins 28 29 You are free now to administer the oath 1 2 FOLLOWS 3 4 1 Q. MR. JUSTICE COSTELLO: Mr. Dennis, we obtained a 5 statement from you but we 6 have not obtained any documents from you. 7 in a position to make documents available to us as 8 required in our letter to you? 9 A. I am not. Are you There were never any documentary, any 10 correspondance, 11 myself and the Guinness & Mahon Cayman other than 12 through Mr. Des Traynor. 13 2 Q. any contact, whatsoever between Is your position then, Mr. Dennis, that you have no 14 correspondance or documents from Mr. Traynor in your 15 possession? 16 A. 17 3 Q. 18 19 That is correct. Yes. Very well then. I am going to ask now Ms. Mackey to ask you some questions? A. Yes. On that note, following the receipt of your 20 letter I did send a letter to Guinness & Mahon 21 in Cayman Trust by registered post, which I can give 22 you a copy of now. 23 letter 24 25 26 27 28 29 4 Q. Yes. I have received no reply to this (Same Handed). 1 2 M S . MACKEY 3 4 5 Q. MS. MACKEY: 5 Very good. Mr. Dennis, just to get, for the 6 record, a little background about yourself first. 7 Can you tell me a little about your own career? 8 are a businessman I understand. 9 of companies? 10 A. 11 12 13 You have a number I will start at the end and say that I will be 70 in another couple of months. 6 Q. A. Yes? I am officially retired since the age of 65 although 14 I do still participate to a limited degree in my 15 business. 16 7 Q. 17 A. 18 8 Q. 19 A. 20 Yes. Your business is what? I am in the motor business. Yes? We are also in businesses which are allied to the motor business i.e. we were in car rental. 21 9 Q. 22 A. 23 10 Q. 24 A. 25 11 Q. 26 Yes? And a finance company. Yes? And property...(INTERJECTION). Can you tell me the name of the car rental and finance company? 27 A. Dennis Car Rentals. 28 12 Q. Dennis Car Rentals? 29 You 1 13 Q. 2 A. 3 14 Q. 4 And the finance company? Phoenix Finance Trust. Yes. Can you give me the name of your other companies ? 5 A. Kilcarne Estates. 6 15 Q. Kilcarne Estates? 7 A. 8 16 Q. 9 A. 10 17 Q. 11 A. 12 18 Q. 13 A. 14 19 Q. 15 A. 16 20 Q. 17 A. 18 21 Q. 19 A. 21 22 Q. 22 A. 23 23 Q. 24 A. 25 24 Q. 26 A. 27 25 Q. 29 Yes? Exchange Finance Limited. Yes? New Street Service Station Limited. Yes? Mark Dennis Opel Limited. Yes? HB Dennis Motors Limited. Yes? And HB Motors Fairview Limited. Yes. All of these are either companies in the motor business or connected with it in some way? 20 28 Limited. Yes. Do...(INTERJECTION)? They are part of the HB Dennis Motor Group. It is ... (INTERJECTION)? Which would encompass them all. It encompasses all of these? Yes. Right. Could you tell me in respect of Phoenix Finance Trust, what exactly is that? 1 26 Q. 2 A. 3 Yes. What was it? It was a credit installment business, finance company. 4 27 Q. 5 A. 6 When you say you disposed of it, you sold it? We sold it to Beneficial Trust Of America Limited, who became Anglo Irish Bank. 7 28 Q. 8 A. 9 29 Q. 10 A. 11 30 Q. 12 A. Right. Kilcarne Estates? It is a property holding company. Is that still in existence? It i s . Exchange Finance Limited? It is a non-trading company. Well, yes, almost non-trading. 13 14 31 Q. 15 A. Right. What was its trading? It was a finance company we started after we 16 disposed of Phoenix Finance Trust but events over 17 took it and it is no longer economic to run it. 18 32 Q. 19 A. 20 33 Q. 21 22 But it is still a company. Right. When you say "events over took it" what happened to it? A. 23 The major institutions, we couldn't compete with them. 24 34 Q. 25 A. Right? The Allied Irish Finance and all the others, Woodchester. 26 27 Right? 35 Q. Yes. Fine. That is grand for background. Thank 28 you very much Mr. Dennis. 29 here and you replied to the questions we had asked You gave us a statement 1 2 3 36 Q. 4 If I can just go through it. Do you have a copy of your own statement and replies there? 5 A. 6 37 Q. 7 A. 8 38 Q. 9 I do indeed, yes. If we might just have a look at those now? Yes. Looking first at the statement, (Exhibit 1) in the second paragraph there you tell us about a trust 10 formed through The Bank Of Ireland Trustee 11 Department. 12 A. 13 39 Q. 14 Yes. Into which you put certain assets. Then you say: "Following a subsequent discussion with Des Traynor, Mr. PJ O'Connor and Brian Bruen which I think was in 1972 I decided to form a second one, into which I put other assets which I required for a specific family purpose." 15 16 17 18 19 A. 20 40 Q. Yes. I want to ask you a little bit about that 21 Mr. Dennis. 22 contact with Mr. Des Traynor? 23 A. 24 First of all, how did you first come in Mr. Traynor would have been a friend for 30/35 years. 25 41 Q. 26 A. 27 42 Q. 28 A. Yes. 29 43 Q. Yes. Right. He also was my next door neighbour but one. Right. You knew him socially? This particular trust arose following a 1 discussion with him. 2 discussion, the context of it? 3 Mr. Traynor was an advisor and confidante and I 4 told him of the trust which I had set up with 5 The Bank Of Ireland. 6 44 Q 7 A Can you tell us about that Yes? And in the course of the financial family planning 8 he made a suggestion to me that if I ever wanted to 9 form a second trust, which I had in mind actually. 10 It would be for a shorter term. 11 45 Q 12 A 13 Yes ? Rather than the long-term permanent trust, which this one was. 14 46 Q 15 A 16 47 Q 17 A Yes? That he could always -- we could discuss it. Right? So, we duly did that. It was shortly after it. It 18 was probably the following -- it was the following 19 year. 20 48 Q Yes. He said to you that if you wished to form a 21 second trust he would be open to discussing it with 22 you? 23 A 24 49 Q 25 A 26 50 Q 27 A 28 51 Q 29 Correct. You subsequently then met and discussed? Correct. Such a possibility with him? Correct. Can you just tell me about the conversation you had on that occasion? What did you indicate to him that 1 2 Well, I wished to provide for a specific family 3 situation, which I thought would eventually arise 4 and which eventually. 5 52 Q 6 A 7 53 Q 8 Sorry, can I just ask you what that was Mr. Dennis? The marriage of my sons. Right. You wished to provide for the marriage of your sons? 9 A 10 54 Q 11 A 12 55 Q 13 A Correct. Yes ? And that dully arrived between 1981 and 1986. Right. Yes. Before...(INTERJECTION)? I do state at one stage here that I don't 14 recall the dates. 15 now say that the dates were between -- on the second 16 page of Replies to Appendix C, I say: 17 This is in the other but I can "I do not recall the dates" 18 19 but the dates were 1981 to 1986. 20 "Appendix C " . 21 56 Q 22 You see "D" under Yes : "I expressed wishes on a number of occasions that capital be disbursed." 23 24 That is the disbursing of the capital. 25 before we get onto that? 26 A 27 57 Q 28 A 29 58 Q Yes, sorry. I am just making the point. Yes? That I say don't recall the dates. However, 1 2 59 Q. 3 Yes. However, getting back to this. In 1972 any way was when this matter was first muted? 4 A. 5 60 Q. 6 Yes. You told Mr. Traynor that you wished to provide for the marriage of your sons? 7 A. 8 61 Q. What did Mr. Traynor suggest then to you? 9 A. Well, I had after tax income at the time. 10 62 Q. 11 A. 12 63 Q. 13 A. Yes. Yes? Which I wanted to set aside for them. Yes? So, he said the most tax effective way was to avail 14 of a trust, another trust, which he could arrange 15 for me in the Cayman Islands. 16 64 Q. 17 the Cayman Islands, did he? 18 A. 19 65 Q. 20 A. 21 66 Q. 22 He did. At that time? Yes. Right. Did he tell you that it would be a discretionary trust? 23 A. 24 67 Q. 25 26 He told you, in fact, that it would be in Yes. Right. What exactly did he tell you about that? How did he explain this trust to you? A. Well, I was familiar with a discretionary trust 27 having formed one -- having had one formed the 28 previous year. 29 68 Q. Right? 1 And I had done a discretionary letter for 2 The Bank Of Ireland. 3 69 Q 4 A 5 6 And he gave me I recall a draft letter, a trust type letter and to be...(INTERJECTION). 70 Q 7 8 Yes ? Yes. You say "a trust type letter", is this a Trust Deed? A 9 It was a -- no, it wasn't a Deed. It was just a sort of a letter between that letter and the letter 10 I already had done for The Bank Of Ireland. 11 the two of them I did another letter which was 12 suitable for this purposes. 13 71 Q 14 A 15 72 Q Between Do you have a copy of the letter that you did? I don't, no. Can you tell me what the contents of that letter 16 were as far as you can remember it, or the gist of 17 it? 18 A 19 20 It is 28 years ago. I find it difficult to -- I have no records. 73 Q Obviously I am not looking for word for word. 21 However, what was the gist of that letter? 22 indicating...(INTERJECTION)? 23 A That on the marriage of my sons that the trust would 24 be divided roughly three ways. 25 nature. 26 74 Q 27 A 29 75 Q Something of that This was a letter stating what you wanted to have done with the trust. 28 Was it It was not a Trust Deed? The letter then was...(INTERJECTION). Was this a Letter Of Wishes? 1 2 76 Q. 3 A. 4 77 Q. 5 Yes. It indicated your wishes for what would be done with the trust fund, is that right? 6 A. 7 78 Q. 8 A. 9 79 Q. 10 A. 11 That is right, in the event of my demise. In the event of your demise? Em...(INTERJECTION). Perhaps, you had better...(INTERJECTION)? Well, if I was still alive it wouldn't arise, would it? 12 80 Q. 13 A. 14 15 Right? I am asking you Mr. Dennis? Yes, what I wished the trust -- to happen to the trust. 81 Q. Right. Before we get on to what you wished to 16 happen to the trust, just let us get back to the 17 conversation with Mr. Traynor. 18 most tax effective way to do what you wished to do, 19 provide for the marriage of your sons, would be to 20 set up a trust in the Cayman Islands? 21 A. 22 82 Q. 23 He said to you the Yes. I am sure you were not anticipating that you would not still be alive at the marriage of your sons? 24 A. 25 83 Q. No. This was something you were providing for a specific 26 event that was going to happen whether you were 27 alive or not, is that not correct? 28 A. 29 84 Q. Correct. What did he do or what did he tell you had to be 1 2 A. Well, I can't recall exactly but I definitely had 3 the letter of discretion. 4 other documents that I signed at the time but I 5 don't recall what they were now. 6 85 Q. 7 A. 86 Q. 10 I do, and I would have read them first. So, they Who were the beneficiaries of this trust? This was a discretionary trust, is that not correct? 11 A. 12 87 Q. 13 A. 14 88 Q. 15 A. 16 89 Q. 17 A. 18 That would be right, yes. Yes. Who were...(INTERJECTION)? My three sons. Your three sons? Yes. Anybody else? I can't recall that now at this stage. I might have included my late wife in it but I can't just recall. 19 90 Q. 20 A. 21 91 Q. 22 A. 23 92 Q. 24 A. 25 Do you recollect who the trustee were to be? No. You do not? No. Did Mr. Traynor tell you? I -- that may -- I don't know because was the trust itself not the trustee as it were? 26 93 Q. 27 A. 28 94 Q. 29 Do you recollect signing documents? wouldn't have been...(INTERJECTION). 8 9 I am sure there were some Well... (INTERJECTION)? If it was Cayman Island Trust? Did he tell you that it was Guinness Mahon Cayman Trust that would be the trustee? Did he mention the 1 2 Yes, definitely. 3 95 Q 4 A 5 96 Q 6 A 8 97 Q 9 That was...(INTERJECTION). He said that this would be where the trust would be Yes, absolutely, yes. Did he tell you that you would not be the Settlor but that the Settlor would be someone in the 10 Cayman Islands? 11 A 12 98 Q 13 No. Such as an accountant employed by Guinness Mahon Cayman Trust or someone like that? A I never heard of any names in the Cayman other than Mr. Traynor. 15 16 99 Q 17 A 18 100 Q 19 20 Yes. created, is that right? 7 14 He did? Other than Mr. Traynor? Yes . How did you transfer the trust assets to the trust? What did he tell you had to be done? A Well, that I don't recall. I either gave him a 21 cheque, or a draft, or some financial instrument of 22 that nature. 23 don't -- yes, I think that would have — 24 I may have transferred funds which is always the 25 same thing at the end of the day. 26 101 Q 27 A 28 102 Q 29 A It was either one or the other. Transferred in what way? was done. From your bank here? Yes . Directly or through Mr. Traynor? I 1 103 Q. 2 A. 3 104 Q. 4 A. 5 105 Q. 6 To whom would you have transferred them? Whoever he told me to make the cheque out to. Who was that? Well, I don't recall at this stage. Did he tell you that there would be a company who would be looking after the trust assets? 7 A. 8 106 Q. 9 A. 10 107 Q. 11 A. 12 108 Q. Absolutely, and that...(INTERJECTION). However, what...(INTERJECTION)? Sorry. What was the name of that company? Guinness Mahon Cayman Trust. He did not mention any other company that would...(INTERJECTION)? 13 14 A. 15 109 Q. 16 A. 17 110 Q. 18 A. Not at that time, no. Did he...(INTERJECTION)? But I do...(INTERJECTION). Did he later? I don't recall that but there was a management fee every year. 19 20 111 Q. 21 A. 22 112 Q. 23 A. Yes? For the trust. Right. Who was that payable to? And there were also some minor charges as well. I 24 don't recall what they were but miscellaneous type 25 charges. 26 113 Q. 27 A. 28 114 Q. 29 A. Who was the management fee payable to? It was deducted out of the capital. At source? Correct. The only time I paid fees I recall was at 1 2 115 Q 3 A 4 5 And subsequent to that it was deducted from the capital, the fund. 116 Q Did Mr. Traynor give you statements from time to time of the way the fund was developing? 6 7 Right. A No. I got -- yes, I did get statements when I asked 8 for them but I didn't ask for them for two or three 9 years because...(INTERJECTION). 10 117 Q 11 A 12 118 Q 13 A 14 119 Q 16 A 17 Did he give you written statements then? Because it was a growth fund I wasn't looking for Yes? Or I didn't want a fund to have an income. I just wanted the fund to be a growth fund. 18 120 Q 19 A Did he give you statements? He gave me statements. About two or three years later I asked "How was the trust preforming?" 20 21 121 Q 22 A 23 Yes? And he said, "I will get you a statement," and he got me a statement. 122 Q 25 26 Just Mr. Traynor, yes. any income from the fund. 15 24 Would you ask, Mr. Traynor? Right. What form was that statement? Do you have copies of any of these statements now? A 27 I did in those days but I am afraid I don't have them any more. 28 123 Q 29 A What happened to them? 1 124 Q. 2 A. When would you have done that? Well, the trust was wound up in 1986 or 1987 and it 3 would be normal for me to keep documents of 4 something that has gone dormant, or no longer has 5 any activity, 6 125 Q. 7 Right. for maybe five or six years. You shredded them in the normal course after that? 8 A. 9 12 6 Q. Yes, after five or six years. Yes. Can you remember the form in which these 10 statements appeared? 11 statements ? 12 A. No. Were they like original bank It was either a blank piece of paper which 13 showed the capital value on one side and then the 14 deductions on the other, which were the deductions I 15 have mentioned for the management fees. 16 127 Q. 17 A. No. 18 128 Q. No? 19 A. Yes. Did it show interest? It was a growth fund. In other words my 20 instructions to Traynor at the beginning was that I 21 would wish it to be a fund where they would look for 22 capital growth because, as I said, there wasn't an 23 income. 24 it aside to provide for the purposes I have 25 mentioned. 26 129 Q. 27 I didn't put it aside for an income. Are you saying there was never any interest on the account? 28 A. 29 130 Q. I put Well, Mr. Traynor managed the fund. Yes? 1 2 131 Q. 3 A. 4 132 Q. Yes. However...(INTERJECTION)? And I don't know what they invested in it. Are you telling me, is your evidence now on oath, 5 that you do not know whether any interest ever 6 accrued on that fund or not? 7 A. 8 133 Q. 9 A. I don't know whether it did or not. Yes? He may have invested it on deposit or he may have 10 had it in bonds. 11 regime in Cayman. 12 134 Q. He told me it was a beneficial tax Did you over the years, between 1972 and the time 13 the trust was wound up, add to the trust funds at 14 any time? 15 A. 16 135 Q. 17 A. 18 136 Q. No. You never did? No. Moving on, again looking at your replies, to our 19 Appendix C there. 20 Question N o . 2: 21 Moving on to the heading over "The use of deposits maintained by Irish residents with the company"? 22 23 A. 24 for a moment. 25 137 Q. 26 A. 27 138 Q. 28 A. 29 Can I just go back here to the my statement again Yes? To refer to it. Yes? Mr. Traynor did tell me at one stage, and I don't 1 2 139 Q 3 A 4 Yes. You mentioned that in your statement? Yes, and it had made no difference. So, I didn't -­ that didn't mean anything to me then. 5 140 Q 6 A 7 141 Q 8 A 9 142 Q 10 A 11 143 Q Yes. I will come to that later? Sorry. However...(INTERJECTION)? I thought you were passing on. No? Yes . However, at the moment what I want to ask you about 12 is in relation to the use of Cayman deposits, and in 13 particular I want to refer you to Question 4 in our 14 letter, which you have answered here in the same way 15 as you answered two, by saying you did not avail of 16 this service? 17 A 18 144 Q 19 20 21 What page on your letter? Page 12 in our letter. I will just read it out to you here:" "Another service apparently offered by the Company in relation to deposits maintained with it by Irish residents was as follows - 22 23 24 25 26 27 28 29 Guinness and Mahon (Ireland) Ltd provided loan and guarantee facilities to Irish residents or to bodies corporate which they controlled or in which they had an interest secured by cash deposits with the Company. It appears to have been an important feature of this service that this security was not referred to in the loan agreement." 1 to give dates, and which you did so etc. etc. 2 reply to that question was that you did not avail of 3 this service, is that correct? 4 That is correct, yes. 5 145 Q That neither directly nor indirectly were your 6 deposits used to back any loan which you, or 7 any company connected with you, obtained from 8 Guinness & Mahon, is that correct? 9 A 10 146 Q 11 A 12 147 Q 13 A 14 148 Q 15 A 16 Your No, because -- that is not correct. Right? Because when the trust was set up originally. Yes ? Mr. Traynor told me. Yes? That if I ever wished to have a letter of guarantee or letter of comfort from the Cayman. 17 149 Q 18 A Yes ? If I wanted funds in a hurry for instance or 19 something of that nature, that he could arrange 20 that. 21 150 Q 22 A Right. Did he? Well, that would have been an internal matter 23 between The Guinness & Mahon Group, which I wouldn't 24 be familiar with. 25 151 Q 26 A 27 152 Q 28 A 29 Well...(INTERJECTION)? Can I just go on from that point? Yes? I did substantial business with Guinness & Mahon in Dublin and without exception any borrowings or any 1 funds which they made available to me were 2 guaranteed firstly, by the joint and several 3 guarantee of my late wife and myself. 4 153 Q 5 A Yes ? It followed on with a floating charge over the 6 assets of whatever particular company it was. 7 were debentures taken out. 8 154 Q 9 A 10 155 Q 11 A 12 156 Q There Yes? They were mortgages taken out on companies. Right. Well...(INTERJECTION)? And...(INTERJECTION). Leaving aside all of that Mr. Dennis, are you aware 13 whether any of your loans were, in fact, backed by 14 your deposit in the Cayman Islands? 15 A 16 I am not aware of whether within Guinness & Mahon they did that. 17 157 Q 18 A 19 158 Q You are not aware? I am not aware. Could we have page 32 there, please? I want to ask 20 you to look at a document, Mr. Dennis, please 21 (Exhibit 2) 22 A 23 159 Q (Same Handed)? Thank you. This is an extract from a document, a report, 24 provided by Guinness & Mahon to The Central Bank. 25 If you look at it there you will see that they 26 describe it as: 27 28 29 "Major loans backed by deposits held in Cayman/Guernsey trust companies." 1 "HB Dennis Limited - £113,648" 2 3 160 Q 4 A 5 161 Q Have we the right one Mary, page 32? Yes, I see that. You will see in the next column: "Deposit Cayman..." 6 7 8 And then it gives the sum that is held on deposit in 9 the Cayman Islands? 10 A 11 162 Q I see that, yes. This document indicates that a loan given to your 12 company HB Dennis Limited in 1978 was backed by your 13 deposit in the Cayman Islands? 14 A 15 163 Q 16 A 17 164 Q Very good. 18 165 Q MR. JUSTICE COSTELLO: That is what it says, yes. Do you accept that? Yes, yes. Thank you. If you would just hand back the paper. 19 If you 20 want a copy of it we will give you a copy but we 21 would prefer to have the other names taken off the 22 list? 23 A 24 16 6 Q 25 A Off quite, yes (Same Handed). MS. MACKEY: Yes? Could I just see that for a second, the date again 26 please? 27 Can I pass you another document Mr. Dennis please? 28 This is at page 24 (Exhibit 3 ) (Same Handed)? 29 (Same Handed) thank you. 1 2 in Ireland. 3 It is headed: "New facilities sanctioned during August 197 8." 4 5 At number three down you will see: 6 "Phoenix Finance Trust." 7 The "Pho" is just missing there in Phoenix. 8 9 Then: ". . .£100, 000. . ." 10 11 And then beside that we have the legend: 12 "... suitable secured." 13 14 Do you see that? 15 A 16 169 Q I do, yes. I do not know if you are familiar with the term 17 "suitably secured" as used by Guinness & Mahon. 18 may have heard references to it in the media 19 recently. 20 by Guinness & Mahon officers during the 21 Moriarty Tribunal to mean is a loan which is 22 secured on a deposit in one of its off shore 23 subsidiaries. 24 Phoenix Finance Trust of £100,000 described as 25 suitably secured? 26 A You However, what has it been stated Here we have a loan given to I see that, yes. 27 Yes. 28 I don't. 29 on, 22 years ago. Do you recollect that loan in 1978? I am afraid not. It is, as I said earlier I can't recall that. 1 171 Q 2 A 3 Right? Guinness & Mahon did provide facilities for Phoenix Finance Trust. 4 172 Q 5 A Yes ? And they advised me that in the long-term we 6 wouldn't be able to keep that company going because 7 it was getting too big and we didn't have access to 8 deposit funds. 9 173 Q 10 A 11 So, they agreed that they would keep the company going. 12 174 Q 13 A 14 15 Yes ? In other words they would provide funds. Yes ? And then we could dispose of it, which is what I explained earlier on had happened in 1981. 175 Q Yes. Again, do you accept that according to 16 Guinness & Mahon this loan to Phoenix Finance was 17 described as "suitably secured". 18 secured upon a cash deposit in either the Cayman 19 Islands or the Channel Islands? 20 MR. O'HIGGINS: 21 Could you just hold there a moment for that? 22 23 In other words MR. JUSTICE COSTELLO: A Yes. I would be quite certain that that loan would have 24 been secured, as I said earlier on, by the joint and 25 several guarantees of my wife and myself, coupled 26 with the floating charge, which I have mentioned. 27 MS. MACKEY: 28 But whether within Cayman, Mr. Traynor arranged to 29 take a charge, I can't say. Yes? 1 177 Q 2 A 3 178 Q 4 Given that he has told you that you could if you wished have a letter of comfort? 5 A 6 179 Q 7 A 8 180 Q 9 Yes, he did. Or a letter o f ...(INTERJECTION)? Yes, he did tell me that. Then it is likely. We have seen the other case already where the previous loan I showed you was 10 described definitely as backed on a Cayman deposit, 11 which it gave the amount for? 12 A 13 181 Q 14 A 15 16 Yes . So it is likely that...(INTERJECTION)? If Mr. Traynor did that like, as I say, that was an internal working in Guinness & Mahon. 182 Q However, when he said to you that you could do this 17 if you wished did he indicate to you that he would 18 ask you on each occasion or that this might be 19 something that would happen subsequently? 20 A 21 183 Q 22 A 23 184 Q 24 A I really can't recollect. I cannot recollect that? That far back. Very good. Now...(INTERJECTION)? I don't think I made any request. As I said the 25 number of guarantees and the number of cross 26 guarantees between especially Kilcarne Estates. 27 185 Q 28 A 29 Yes? Which was the property holding companies, were the main assets where. 1 186 Q 2 A And the personal guarantees, and debentures, and the 3 mortgages, and I might add also that these charges, 4 possibly including that one, would have been 5 registered in Stubbs Gazette Magazine, which comes 6 out each week. 7 187 Q 8 A 9 Yes? And I recall seeing them in The Irish Trade Protection Association Magazine, which also comes 10 out each week. 11 188 Q 12 A Yes ? And charges against limited companies. 13 quite frequently. 14 that...(INTERJECTION). 15 189 Q 16 A 17 190 Q 18 I saw them So, Guinness & Mahon took all Yes? Those guarantees. Very good. Getting back to your statement Mr. Dennis? 19 A 20 191 Q Yes . You tell us that the specific family purpose 21 eventually matured. 22 married? 23 A 24 192 Q 25 A 26 In other words, your sons were Yes . What happened the trust funds at that point? Well, I asked Mr. Traynor to disburse or to allocate some of the funds for those purposes. 27 193 Q 28 A 29 194 Q Some of the funds? Yes . 1 2 195 Q 3 Yes. Had you had a statement from Mr. Traynor around that time? 4 A 5 196 Q 6 A 7 Well, I would have had a statement, yes. Right. How was this allocation made? Well, there was only two contacts. On one side was Mr. Traynor. 8 197 Q 9 A 10 198 Q 11 A 12 Yes? I never met anybody else whatsoever. Yes ? Or had any conversations or correspondence, as I have said. 13 199 Q 14 A 15 200 Q 16 A 17 201 Q 18 A 19 202 Q 20 Yes? On the other side it was myself. Right. So what happened? It was between the two of us. Yes ? That was the chain. Yes. What happened when you wished to have these funds for your sons? 21 A 22 203 Q 23 A 24 204 Q 25 A Well, I would tell Mr. Traynor what I wanted to do. Yes? And he would arrange it. How? How would he arrange it? What would he do? Well, he would transfer funds, or give me a cheque 26 made out to my son, or give me a cheque perhaps made 27 out to me to pass on, something of that nature. 28 29 205 Q He would give you a cheque and this cheque...(INTERJECTION)? 1 2 206 Q 3 A 4 207 Q 5 A Yes . And the cheque would b e ...(INTERJECTION)? Or he made have transferred funds. Now, at this 6 stage I can't recall exactly which way it was done 7 but at the end of the day the funds where made 8 available. 9 208 Q Yes. What I am trying to find out now is how they 10 were made available? 11 you a cheque, who was the cheque drawn upon? 12 A 13 209 Q 14 A 15 210 Q 16 A 17 211 Q 18 19 How this happened? If he gave Who was it drawn on? Yes? I have no idea at this stage. You cannot remember? No. Where a transfer was arranged, how was that done? The money was transferred from where to where? A I have a reservation about whether a transfer was 20 made or not. 21 cheque or draft of some sort. 22 212 Q 23 A 24 I tend to think it would have been a This cheque was payable to you? It may have been payable to my son but I think it is more likely he made it payable to me to pass on. 25 213 Q 26 A 27 214 Q 28 A 29 215 Q Did he personally hand you this cheque? He would have. Is this at a meeting? He would have, yes. 1 2 216 Q 3 A 4 217 Q 5 A 6 218 Q 7 A 8 219 Q 9 A 10 220 Q 11 A 12 221 Q 13 14 A Where did this happen? Mr. Traynor had an office in his house. In his house in the Howth Road? Correct. Is this where you visited him? Yes . To carry out these transactions? Yes . In his office on the Howth Road he gave you a Yes, that would be the only place he would have given me the cheque, yes. 222 Q 17 18 Yes . cheque? 15 16 He did? Right. Did you ever go into his office in Guinness & Mahon? A Not to my knowledge. In the course of the business, 19 of our group business, it is possible I went into 20 his office. 21 223 Q 22 A 23 24 Yes? I just don't recall. I did have some...(INTERJECTION). 224 Q 25 I am really speaking in connection with these transactions? 26 A 27 225 Q 28 A 29 226 Q No, never. Yes? No, never. This was all done in his home? 1 2 227 Q 3 When he allocated the funds on the occasion of the marriage of your sons, you have, is it, three sons? 4 A 5 228 Q 6 A 7 229 Q 8 A 9 230 Q 10 A Correct. Three sons? Yes . Are all three of them married? They are. So this happened on the occasion of each marriage? Not actually on the date you know, if it was six 11 months later or six months before that they bought 12 houses. 13 231 Q 14 A 15 232 Q 16 A 17 233 Q 18 A Yes? But it was in or about that period. That time? Yes . Yes. And...(INTERJECTION)? And there was some disbursed at the end or perhaps 19 it was what might have been a balance to 20 grandchildren, which had arrived by then. 21 234 Q 22 A 23 235 Q 24 A 25 236 Q 26 A 27 28 29 I was about to come to that? Yes . I was going to ask you? Yes . When was the final marriage of the three sons? 1985 but one of them didn't get a house for a further year. 237 Q Right. So, that is where the 1986 comes in. By 1986 you had disbursed to your three sons the amounts that you wished to give them? 1 2 238 Q And there was some left over, which you were then 3 about to explain to me was disbursed to 4 grandchildren? 5 A 6 239 Q 7 Correct, yes. Just getting back to the beginning, what you told me at the start about this discretionary trust? 8 A 9 240 Q 10 A Can I just come in for one moment. Yes ? When the final disbursements were made that would 11 have been the entire. 12 grandchildren would have been allocated some of 13 that. 14 241 Q 15 A 16 242 Q If there was a balance the That is what I thought? With the final house shall we call it. However, I just want to get back to the beginning of 17 this trust, which you told me was a discretionary 18 trust? 19 A 20 243 Q 21 A 22 244 Q 23 A 24 245 Q 25 A 26 The beneficiaries of which were your three sons? Yes . Were you grandchildren also beneficiaries? No, not originally. Right? Obviously, the boys weren't married. I get your point actually. 27 246 Q 28 A 29 Yes . Yes? The original discretionary trust would not have mentioned grandchildren. 1 247 Q 2 A 3 248 Q 4 Right? That is correct, yes. Can you explain to me then how it arose that the grandchildren got disbursements from the trust? 5 A 6 249 Q 7 A 8 250 Q 9 Well, Mr. Traynor was carrying out my wishes. Carrying out your wishes? Yes . Can you tell me a little bit about the class of persons who were described as potential 10 beneficiaries under the trust? 11 A 12 251 Q The type of person? The class. You are familiar with the concept of a discretionary trust? 13 14 A 15 252 Q 16 A 17 253 Q 18 A 19 254 Q 20 Yes, yes. Yes? Yes . There can be number of beneficiaries? Correct. And among those beneficiaries the Settlor can appoint who is to benefit at any given time? 21 A 22 255 Q 23 A 24 256 Q Correct. Right. Your three sons were your beneficiaries? Correct. What I am wondering about is how you were able to 25 express that somebody outside the beneficiaries 26 would benefit? 27 A Well, if you make a discretionary trust you can't 28 vary that afterwards, is that what you are question 29 is ? 1 257 Q 2 A 3 I w o u l d h a v e in as f a r as t h a t w h a t e v e r b a l a n c e w a s left w o u l d h a v e g o n e to m y g r a n d c h i l d r e n . 4 258 Q 5 A 6 259 Q 7 A 8 26 0 Q I see. This was by your wishes? Of course, yes. W h i c h y o u i n d i c a t e d t o Mr. Traynor? Yes . I see. 9 T h e t r u s t t h e n w a s w o u n d up, y o u say. "On the s e c o n d o c c a s i o n I t o l d h i m , " 10 Mr. 11 Traynor, " t h a t it w o u l d b e m y w i s h t h a t t h e Trust would be dissolved." 12 13 14 I t h i n k i n l a t e 1 9 8 6 or 1 9 8 7 ? 15 A 16 26 1 Q 17 A 18 262 Q 19 A 20 26 3 Q 21 22 Yes, t h a t is c o r r e c t . T h a t is c o r r e c t ? Yes . D i d he do t hat? He did, Yes. yes. How did he in f o r m you that that h a d b een done? D i d he tell you? A Well, Did h e ...(I N T E R J E C T I O N ) ? I s a i d to h i m t h a t -- h e s a i d s o m e t h i n g t o m e 23 about the trust, 24 a n d I said, 25 that up n o w shortly". 26 264 Q 27 A 28 26 5 Q 29 A w h i c h I h a v e f o r g o t t e n w h a t it was, "W ell, b y the w a y I want you to w i n d Yes? He s a i d p r o b a b l y , Right. "Fine, just let me n o w when". Did t h a t ...(I N T E R J E C T I O N ) ? A n d t h e n e v e n t u a l l y I said, " Y o u c a n d o it n o w . " 1 2 6 6 Q. A t t h a t s t a g e t h e r e w a s s t i l l a b a l a n c e r e m a i n i n g in the trust? 2 3 A. 4 267 Q. 5 A. 6 2 68 Q. 7 A. 8 2 6 9 Q. 9 A. 10 27 0 Q. 11 A. Yes, yes. T h a t is c o r r e c t ? Yes. What h a ppened that balance? T h a t is t h e b a l a n c e I a m s p e a k i n g of. T h a t is t h e b a l a n c e t h a t w e n t t o t h e g r a n d c h i l d r e n ? Yes, yes. N o w . . . (INTERJECTION)? P l u s p e r h a p s m y t h i r d son. 12 was 13 was l o o k e d after. 14 27 1 Q. 15 A. 16 272 Q. 17 A. 18 19 In o t h e r w o r d s i f t h e r e so m u c h t h e r e a n d t h e r e w a s a b a l a n c e a f t e r he Yes? T h a t w e n t to t h e g r a n d c h i l d r e n . I see. 1986, That was 1986? a n d I t h i n k it is w a s t h e f i r s t m o n t h o r t w o of 1987. 27 3 Q. Right. C a n I a s k y o u t o l o o k at a n o t h e r d o c u m e n t ? It is p a g e 30 20 21 A. 22 274 Q. 23 A. 24 27 5 Q. ( E x h i b i t 4 ) (Same H a n d e d ) ? Yes. T h a t is, as y o u w i l l see, not a very good photocopy? Yes. However, I t h i n k y o u c a n s e e w h a t it is. It is a n 25 E x c h a n g e F i n a n c e L i m i t e d c h e q u e m a d e p a y a b l e to 26 Mr. 27 A. 28 2 7 6 Q. 29 J.D. Traynor? Correct. D a t e d 4th A p r i l 1993? 1 277 Q. 2 A. 3 278 Q. 4 T h a t w a s h e l p i n g a f r i e n d i n n ee d . T h e f r i e n d in n e e d b e i n g ? S or ry , I do not u n d e r s t a n d you? 5 A. 6 2 7 9 Q. 7 A. 8 28 0 Q. 9 A. 10 28 1 Q. 11 A. 12 282 Q. 13 A. 14 15 C a n y o u t e l l m e w h a t t h a t is? A mutual f r i e n d h a d go t i n t o f i n a n c i a l d i f f i c u l t i e s . Yes? A n d Mr. T r a y n o r o r g a n i s e d help. Right? A m o n g s t the friends. Yes. A n d t h a t is w h a t t h a t was. C a n y o u t e l l us a l i t t l e b i t m o r e a b o u t t h a t ? W o u l d y o u m i n d if I c o n s u l t w i t h Mr. O'Higgins about that. 28 3 Q. 16 Yes, certainly. take a break. 17 A. 18 284 Q. 19 A. 20 28 5 Q. 21 If it y o u l i k e Mr. So rr y, Mr. Dennis we m ight Dennis? Yes. We m i g h t take a b r e a k for a coffee now? Yes. A n d y o u c a n c o n s u l t o v e r a c u p of c o f f e e a n d w e w i l l c o m e b a c k to y o u w i t h i n a b o u t t e n m i n u t e s . 22 A. 23 2 8 6 Q. 24 A. Fine. Is t h a t a l l r i g h t ? Yes. T h a n k you. 25 SHORT ADJOURNMENT 26 27 28 29 287 Q. MS. MACKEY: V e r y w e l l t he n . 1 a s i d e t h e q u e s t i o n of t h e K e n t f o r d c h e q u e . 2 w i s h to a s k y o u a n y m o r e q u e s t i o n s a b o u t t h a t - ­ 3 so rr y, 4 Yes . 5 288 Q I d o n o t w i s h to a s k y o u a n y m o r e q u e s t i o n s a b o u t A Yes. I w o u l d just repeat again that that - ­ 8 Mr. 9 difficulties. 10 Traynor. that? 6 7 t h e c h e q u e t o Mr. I do n o t 289 Q Yes, T r a y n o r -- t h e r e w a s a f r i e n d w h o w a s i n I know. I u n d e r s t a n d th a t . I am not concerned about that? 11 12 A 13 29 0 Q 14 A 15 29 1 Q 16 A T h a n k you. 17 292 Q T h a n k you. T h e f r i e n d is s i n c e dead . T h a t is a l l r i g h t ? So, I t h i n k it is u n n e c e s s a r y t o n a m e him. I d o n o t w i s h to p u r s u e t h a t ? I w a n t t o go b a c k to t h e l e t t e r , 18 c o p y of t h e l e t t e r , 19 morning, 20 Mr. 21 A 22 29 3 Q the y o u f u r n i s h e d t o us t h i s w h i c h y o u w r o t e to t h e C a y m a n I s l a n d s Dennis ( E x h i b i t 5)? Yes . In t h a t l e t t e r y o u a s k G u i n n e s s M a h o n C a y m a n T r u s t 23 -- w el l , 24 n o w b e c a u s e it is no l o n g e r c a l l e d G u i n n e s s M a n 25 C a y m a n Trust. 26 if t h e y e v e r in t h e p a s t h a d a n y a c c o u n t o f a n y t y p e 27 in your name? 28 29 A Yes . in fact, it s h o u l d b e However, "Ansbacher" Limited in a n y e v e n t yo u a s k e d t h e m 1 2 What you have been telling us about here today is a 3 trust managed by Guinness Mahan Cayman trust. 4 would like you now, we would like you, to write to 5 them again asking them about your trust specifically 6 rather than an account because this may mislead 7 them. 8 therefore answer you that they have nothing. 9 you had there with them was a trust? 10 A 11 296 Q I They may look and find no account and What Yes . If you would write to them, under the name of 12 "Ansbacher" Cayman Limited, asking them for details 13 of the trust which was set up? 14 set up in your name because from what we have 15 learned of these trusts set up in the Cayman, they 16 are quite often set up in the name of someone else 17 out there in the Caymans. 18 you is that you identify this trust to "Ansbacher" 19 by naming the beneficiaries, the beneficiaries whom 20 you chose when you were setting up this trust. 21 please for The Trust Deed, copies of The Letters 22 Of Wishes, and copies of all related documents and 23 correspondence in connection with the trust 24 specifically? 25 A 26 297 Q 27 A 28 298 Q 29 It may not have been What we would suggest to Certainly. If you would do that? Yes . Thank you very much. You mentioned writing a Letter Of Wishes, which you said you drafted Ask 1 yourself by looking at one you had already done 2 for Bank Of Ireland? 3 Yes . 4 299 Q 5 A 6 300 Q 7 A 8 301 Q 9 A 10 302 Q 11 A 12 303 Q 13 A 14 Yes . To whom did you address that Letter Of Wishes? To who ever Mr. Traynor told me to address it to. Who was that? I am afraid I can't recall. You cannot recall? Not 28 years later, no. Would it have been addressed to Mr. Traynor himself? Well, I would doubt it if I am asked for an opinion but I have no idea who it was addressed to. 15 304 Q 16 A 17 305 Q 18 You do not remember? No. Thank you. you. 19 A 20 306 Q 21 And the draft one that Mr. Traynor provided to you? That is all the questions I have for Thank you Mr. Dennis? Thank you. I think Judge Costello would like to ask you some questions. 22 23 24 25 26 27 28 29 END OF EXAMINATION OF MR. BRIAN DENNIS BY MS. MACKEY 1 2 3 4 MR. JUSTICE COSTELLO: 5 Just a few questions Mr. Dennis. I want to ask 6 you about the role, as you know it, of College 7 Trustees in the Channel Islands, in relation to the 8 trust arrangements you made with Mr. Traynor? 9 did he tell you? 10 A Nothing. What He mentioned to me, as I have said in my 11 letter, that he was changing the trust to the 12 Channel Islands and that it made no difference. 13 that was fair enough with me. 14 he mentioned something about the Channel Islands, 15 which I don't recall but it wasn't significant, and 16 on that occasion I told him that it was my wish that 17 the trust would be wound up. 18 308 Q 19 A On a second occasion Yes ? When it was being wound up I have an idea that I 20 signed one or two documents. 21 recall what they were but one I did write out in 22 longhand on Mr. 23 309 Q 24 A At this stage I can't Traynor's instructions. Yes ? Because again the -- I had no connection or no 25 correspondence, no contact, whatsoever with 26 Guinness & Mahon in the Channel Islands. 27 310 Q 28 A 29 So, The...(INTERJECTION)? But on the winding up of the trust I did sign one or two documents and I am pretty certain of that, and 1 one was in longhand but I don't recall at this stage 2 what it was. 3 311 Q 4 5 Was it a document addressed to some entity in the Channel Islands? A I can't really recall. I wrote something out in 6 longhand. 7 out something in longhand. 8 312 Q 9 A He said, under his direction, to write Yes? And there may have been one or two other forms which 10 I signed on the dissolution of the trust but I don't 11 recall what they are at this stage. 12 313 Q 13 A 14 314 Q 15 A Did they relate to a Channel Islands entity? I can't recall who they related to. Yes . I did -- as far as I recall this is the end of 1986 16 or 1987. 17 documentation whatsoever. 18 315 Q Yes. So, I just -- and again I had no I would just like you to look at one other 19 document? 20 December 1986 from — 21 (Same Handed)(Exhibit 6)? 22 A 23 316 Q 24 A 1986? 25 317 Q 1986? 26 A 27 318 Q 28 29 Ms. Cummins, it is a letter of 24th it is the one we got today Thank you. This is a letter dated 24th December 1986? Yes . It is an internal memo to Mr. Pender of GMI. will see there on page two, "(D) College Trustees Clients for whom College have arranged backing deposits You 1 2 3 That is Guinness Mahon Cayman Trust. 4 there that there are backing deposits and the figure 5 then -- the name of the company is down there, 6 You will see "Exchange finance." 7 8 That is your company? 9 A 10 319 Q Yes . "£108,279.83"? 11 12 A 13 320 Q 14 Yes . And, "Dennis Motors £110,260.89." 15 16 Do you see those there? 17 A 18 321 Q I do indeed, yes. This appears to refer to loans which 19 Guinness & Mahon in Dublin had made to these 20 companies of yours, which were backed by College 21 Trustees Clients, of which you appear to have been 22 -- which were College Trustees, whose account was 23 used to back these loans. 24 loans ? 25 A 26 I never heard of College Trustees until I read their name in the paper in the last couple of years. 27 322 Q 28 A 29 Do you remember these Do you remember these loans? Not specifically but I would accept that I did have loans, that my companies did have loans, yes. 1 323 Q. 2 A. 3 324 Q. 4 A. 5 325 Q. From Guinness & Mahon? Yes, definitely, yes. Yes? Yes. Approximately these amounts would be approximately 6 correct in your view? 7 doubt them? 8 A. 9 326 Q. 10 A. 11 327 Q. There is no reason for you to No, no, I don't doubt them, no. Yes? Yes. Very well then Mr. Dennis. The other matter I 12 wanted to just ask you about, just to bring you back 13 Mr. Dennis t o ...(INTERJECTION)? 14 A. 15 328 Q. 16 Can we get a copy of that. You can get a copy of that but we will take out the other names from that? 17 A. 18 329 Q. Yes. The other matter I want to ask you about is 19 the original establishment of the trust 20 with Mr. Traynor. 21 these documents, that we have shown you, show that 22 the trust at that time was at least about £218,000? 23 A. 24 330 Q. 25 The funds which appear there in Yes. We are not concerned with the exact amounts at all in our enquiry? 26 A. 27 331 Q. Yes. However, in order to ascertain what, in fact, 28 happened and what you made of the services of 29 the Bank, I must ask you was the total trust much in 1 2 No, no, and again I am trying to think what would 3 have happened but, as I mentioned earlier on, it was 4 a growth. 5 such that may include the accruals. 6 332 Q 7 A The fund/trust was a growth fund and as We all know...(INTERJECTION)? But it didn't -- in answer to your first question, 8 no, as far as I remember that was about the max it 9 ever went to. 10 333 Q Yes. We all know Mr. Dennis what a growth fund is. 11 You gave the money to Mr. Traynor, is that not 12 right, originally? 13 A 14 334 Q 15 A 16 335 Q Correct. You did not add to it at any time, or did you? Well, it accrued as I said and...(INTERJECTION). No. I am talking about transfers by you to 17 Mr. Traynor. 18 put into it? 19 A 20 336 Q 21 A 22 337 Q 23 A 24 Did you give him some further funds to I can't recall at this stage. Yes? Whether I did add to it but...(INTERJECTION). Is it possible? Could I have a look at the date on that please, until I just see? 25 338 Q 26 A 27 339 Q 28 A 29 340 Q Yes ? The last one you gave me. The first letter, the first page? The second one you gave me. Yes, the second one but that is page 2. 45 The first 1 page of the letter is 1986. 2 24th December 1986 (Exhibit 6). 3 A. Sorry, that isn't -- I don't think I am on that, 4 am I? 5 MS. MACKEY: Where is the date? 6 7 It is the The date is on the first page. A. The date, I beg your pardon. December 1986. Well, 8 by December 1986 the trust had been in existence for 9 about 14 years. 10 341 Q. 11 A. 12 MR. JUSTICE COSTELLO: Well...(INTERJECTION)? So, I am uncertain as to whether that was the accrual. 13 342 Q. 14 A. 15 343 Q. It should be possible for you...(INTERJECTION)? Or whether, yes. It should be possible for you Mr. Dennis to remember 16 whether or not you ever went to Mr. Traynor and gave 17 him some further funds to be added to your trust 18 fund. 19 A. 20 344 Q. 21 A. 22 345 Q. 23 Can you remember? The answer is I can't remember at this stage. Do you think is it possible? I think it is possible. If you gave to Mr. Traynor for the trust a capital sum? 24 A. 25 34 6 Q. 26 A. 27 347 Q. 28 A. 29 348 Q. Yes. Do you remember the amount you gave him initially? I do, yes. How much initially did you give him? £100,000. Yes. Is it not obvious Mr. Dennis that interest 1 would have been earned on that £100,000 by the 2 trustees ? 3 A. Yes, yes. I mean that he -- Mr. Traynor was to 4 invest that as he sought fit and whether he bought 5 and sold equities, or whether he bought bonds, or 6 whether he had it on deposit I couldn't say. 7 349 Q. 8 A. 9 350 Q. 10 I could not say? Yes. If he had it on deposit, it would have earned interest, wouldn't it? 11 A. 12 351 Q. Correct. Whatever he might have done with the capital in the 13 buying and selling of bonds, there would have been 14 money put on deposit, which would have earned 15 interest? 16 A. 17 Well, I was paying a management fee each year for the trust and that was to manage it. 18 352 Q. 19 A. 20 353 Q. 21 A. Yes? So, he was managing it and I...(INTERJECTION). Yes? And I didn't look. In a growth fund you would only 22 look at it every five years because it is not 23 something you would look at short term. 24 354 Q. No, I am not talking about a growth fund. I am 25 talking about interest being earned on the capital 26 that you had given him? 27 A. 28 355 Q. 29 Correct. Is it not obvious that some interest would have been 1 2 356 Q. 3 4 5 Am I correct in saying that you did not return this in any of your income tax returns? A. 357 Q . 6 A. 7 358 Q. 8 A. 9 That would be correct. Yes. That is if there was interest earned. Yes? As I said Mr. Traynor was managing that trust and that fund. 10 359 Q. 11 A. 12 Yes? And how he managed it -- at the end of the year or every couple -- whenever I got the statements. 13 360 Q. 14 A. 15 361 Q. 16 A. 17 362 Q. Yes? The capital sum was shown. Yes. Well...(INTERJECTION)? And the deductions on the other side. Yes. Either -- this was financially would appear to 18 have been an attractive operation because the 19 capital had increased from £100,000 to over 20 £ 2 0 0 , 000 ? 21 A. 22 363 Q. 23 A. 24 Yes. And no tax was paid on it at all, is that correct? That is correct. due. 25 364 Q. 26 A. 27 365 Q. Yes. 28 A. Yes. 29 366 Q. Yes. There may not have been any tax If he was buying and selling instruments. Well... (INTERJECTION)? That were. It might not have been? Did you not consider that you should continue 1 such an operation with Mr. Traynor's assistance 2 afterwards, after you finished in 1986? 3 4 367 Q. 5 A. 6 368 Q. 7 A. 8 You did not go into it? No. You didn't? It had -- the purpose for which I set up the trust had arrived or had been met. 9 369 Q. 10 A. 11 370 Q. 12 A. Yes? And that was the end of it. Yes? I have had no contact whatsoever since the 13 dissolution of the trust, which as I say is late 14 1986/87, with anyone from Guinness & Mahon. 15 heard of "Ansbacher" Cayman. 16 371 Q. 17 A. 18 19 Yes? I never heard of College Trustees to the best of my knowledge. 372 Q. 20 Yes. You would have met Mr. Traynor just socially then, is that it? 21 A. 22 373 Q. 23 That is correct, yes. You did not have any commercial dealings with him then after that? 24 A. 25 37 4 Q. None whatsoever. What about Guinness & Mahon, did you continue ...(INTERJECTION)? 26 27 A. 28 375 Q. 29 I never Yes. Using them as your bankers? 1 376 Q 2 A 3 377 Q 4 A 5 Thank you? And I would repeat again that any loan we ever got from Guinness & Mahon was secured. 6 378 Q 7 A 8 Yes? By personal guarantees which, of course, nowadays we don't have. 9 379 Q 10 A 11 Yes ? But personal guarantees followed by floating charges. 12 380 Q 13 A 14 381 Q 15 A 16 17 Yes . Yes ? Over the assets of the companies involved. Yes? There were mortgages and debentures and they were all registered in The Company's Office. 382 Q Very well Mr. Dennis. Thank you. We would be glad 18 if you would try to obtain the documents which we 19 have asked for? 20 A 21 383 Q 22 Yes . Your interview will be transcribed and we would ask you to come in to sign the transcript? 23 A 24 384 Q Certainly, yes. Thank you. And if you would not mind sending us on a copy of 25 any letter that you write to Cayman and any 26 correspondence you have? 27 A Certainly, yes. 28 29 THE EXAMINATION WAS THEN CONCLUDED. a 0 50K!?qu 7 \buAbZ.? \0 bet.er I am fully prepared to assist the Inspectors in any way I can. At the outset I would stress and am absolutely certain that I do not have and never did have any correspondence documentation or records in my possession concerning Guinness and Mahon Cayman Trust. I never had any direct contact whatsoever with it. In 1971 Bank O f Ireland Trustee Department formed a Discretionary Trust for me (see copy o f letter) into which I put certain assets and following a subsequent discussion with Mr Des Traynor, Mr PJ O Connor (solicitor) and Brian Bruen (accountant) which I think was in 19721 decided to form a second one, into which I put other assets which I required for a specific family purpose which eventually matured and I then told Mr Traynor it was my wish that he dissolve the Trust I think in late 1986 or 1987. At some time and I cannot recall the date he told me he was changing the trust technically to the Channel Islands and that it made no difference and on another occasion he mentioned some further change which I cannot recall. On the second occasion I told him that it would be my wish that the Trust be dissolved in the near future. I imagine this was between mid 1985 and 1986. After the trust was dissolved I had no further association with Guinness and Mahon Cayman or its successors. The dates and generality o f above are to the best o f my recollection but may vary somewhat. R E P L IE S T O A P P E N D IX C CAYMAN ISLANDS TRUSTS AND TRUST COMPANIES 1. (A) Mr Des Traynor, MrPJ O Connor, and Mr Brian Bruen advised me I think in the early 1970‘s and I never had any documentation. ' (B ) I think in the early 1970’a together with fees involved. (C) Nothing further. (D ) The income was allowed accrue. I am o f the opinion that I expressed wishes on a number o f occasions that capital be disbursed to or on behalf o f ftm ily * members. I do not recall the dates. • ' (E) I was the settlor. (F) I executed a letter o f wishes but I do not have a copy. (G) Other than (D) the only instruction I ever gave was verbally to Mr Traynor to dissolve the Trust. * T H E U S E O F D E P O S IT S M A IN T A IN E D B Y IR IS H R E S ID E N T S W IT H TH E COM PANY 2 . 1 did not avail o f this service or any similar service and have no knowledge of E X C H A N G E C O N T R O L A C T S 19S4 - 1 9 9 2 6 . I recall signing a number o f documents including a letter o f wishes at the formation of the Trust I cannot recollect if one was for exchange permission. ■ C H A N N E L IS L A N D S T R U S T A N P C O M P A N IE S . 7. I did not establish a trust In the Channel Islands and refer you to my general statement 8. (A) None (B) None (C) None ‘ (D) Trust set up for family purposes (name of trust unknown) thmmmm aoaiicmi "BANK. DUWJM.” tn jW O tM KO. 77*101 M N V TO "til* mmw t m m tu tor." 2. K/CH. 11th March 1971. . H .B . D e n n is E s q , " Io n a 1** 1 3 0 Howth R oad, Doax B r ia n t I now e n c lo se a Memorandum I h a ve .p re p are d a r is in g from o u t m eeting on Monday l a s t . I have' s e n t c o p ie s d i r e c t to P a t O 'Connor and B r ia n B ru e n . I t h in k '.t h is ', i d e n t if ie e th e v a r io u s s te p s to be taken to im plem ent th e p r o p o s a ls . I have In d ic a t e d th e r e s p o n s ib il it y o f the in d i v id u a l p a r t ie s i n t h i s re q p e o t. V ' I would l i k e to su g g e st t h a t when you and yo u r a d v is e r s have had an o p p o rtu n ity o f d ig e e tin g t h i s t h a t we meet f i r s t to c l a r i f y one o r two t e c h n ic a l p o in t s 1 have r a is e d - e . g . th e le a s in g o f th e p re m ises, w hether in f a c t we have one o r tw o -S e ttle m e n ts and then to s p e c i f i c a l l y arran g e f o r the' form al .Company m ee tin g s » p r io r to w hich o f co u rse a l l p a r t ie s w i l l have com pleted t h e i r d u tie s * ’ 1 hope to arran g e t h i s m eeting i n th e week commencing th e 22nd in s t a n t o r a t l a t e s t the following week. U n le s s I h e a r from you bsfora t h i s 1 w i l l c o n ta c t you i n th e f i r s t in s t a n c e . Should you p e r s o n a lly w ish to c a l l to d is c u s s th e m a tte r f u r t h e r p a r t i c u l a r l y w ith your w if e , p le a s e have no h e a it a t io n i n c o n ta c tin g me. Y o u rs A M &m m or TMC *ANK OP m o n o 0*501* cumwcss * wmw limtep •, * ' HMOR LOWS BACKED i ‘DEPOSITS* HELP » CAVHW/SUtlWSET TRUST CCHMWIES OutJtMdlhfl Borrowr 12. n.b. DwmW L t ^ «t 30 /a ril 1878 I M ---- • P»PMlt Cwrni .. nff’hnrj, Offtnorc .fiuemfey NEVT FACILITIES DURING AUGUST VBNIX FINANCE TRUST 31/8/78 PO’ D/AC 1 0 0 , 0 0 0 .0 0 . SANCTIONED 1978 Suitably secured'. It .- Wk? 'Elmlandwas: -- .. ?r . :gh. .. . . moigm}; - . - -. .. as" ?guu?Jl i c- . 9""q0 - j' 1 453.3.1.05. .5353434? 'y . . h-A no Iona 130 Howth lload Clontarf Dublin 3 . Guinness Mahon Cayman Trust P.O. Box 337 Grand Cayman British West Indies 10/02/00 RE: 11. BRIAN DENNIS Dear Sirs, Please inform me if yoti ever in the past had any account of any type in my,name. If so please send me all the details and a statement of the account. If you have any documents or correspondence I would ask you •to forward them or copies to me. ^p o sc A’ / G 1 S T ! : R I !) Yours Faithfully ( ' ) ,i r ,i i ; 11 i: C U S T O M E R R EC EIPT / A D M H A IL H. Brian Dennis P. O. &>x 3 2 7 Cr-R-Pl NJ WEST 7Z>JS)/€3 Item No. RR 2685 0097 7IE VALUEOF CONTENTS in woods &figures) ^4. p riv £ ACC0TIMG OFFICER'S REG. FEE NTULS,' £ ^ IS N O TE : This receipt is y o u r p roo f of posting should oe retained carefully. See back for conditions. ’ CUSTOMER'S REFERENCE RR 2 6 8 5 0 0 9 7 7IE GUINNESS MANON CAYMAN TRUST P . O . B O X 337 GRAND CAYMAN BRITISH WEST INDIES KimiiKiraiKiDararaixiraiKirKiiLKirarKU.KiraraiKirKiraEKirKirKirxirarajKirarKir^rafKUKin^uKi IP U N D E L I V E R E D R E T U R N TO H. B R I A N D E N N I S . 130 H O W T H R O A D DUBLIN 3 IRELAND T '•is"' vj»; B . A . U rse ll B ru ce : A s req u ested I list h ereu n to p artlcu lw s o f the A ccou n t, te r which w e hold backm . deposits fro m G M C T : 8 b) R esid en t A cco u n t, for wh,ch w e ho.d d e p C t , fro „ GMCT d u * hypothecated : P age 2 r c) R esid en t A ccount for which w e hold deposit d irect from Olym pic Investm ents, which is a Cayman Com pany : - d) C ollege T rustee clien ts for whom C ollege have arranged backing d ep osits here through G.M .C.T. : - E xchange Finance 108,279.83 Stg. D ennis M otors 110,260.89 Stg. With referen ce to . . . . , - - - and . , you w ill also have sim ilar loans and secu rity on your own books for sign ifican t am ounts. Regards, M ichael J. P en d er S O L IC IT O R S no04‘-'! i J A M E S E. (n iicu im s ISO B EL B U T L E R JFO’H /M W /N 857 O ffice o f the Inspectors o f the H igh Court Ansbacher (Caym an) Ltd., 3rd Floor Trident H ouse 1! & Blackrock Co. Dublin ' C /D 04/M F B y fax 283 39 29 and by post 10 th October 2001 R e: B rian D ennis Dear Sirs, W e refer to previous correspondence herein and in particular to your letter o f 27th A ugust last. W e agree that our client w as a client w as a client o f G uinness & M ahon Caymen. H ow ever, you subsequently stated in your letter as follow s:— “Y ou are a client o f Ansbacher”. This is entirely untrue. Mr. D enis ceased to have any connection w hatsoever with Guinness & M ahon Caym en at the end o f 1986 and never had any dealings with them or their successors after that date. W ith regard to the transcript, w e should be obliged i f you w ould nom inate a date in w hich it could be signed. Y ours faithfully, A p p e n d ix X V (2 7 ) M r C h a r le s T G D illo n , d e c e a s e d 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Charles TG Dillon. a) Letter o f 8 May 2000 from Carl J Dillon to Inspectors. b) Internal Guinness and Mahon memo o f 24 October 1986. c) Letter o f 8 January 1993 from Hamilton Ross to IIB. d) Letter o f 23 September 1994 from Hamilton Ross to Corporate Services IIB. e) Letter o f 16 December 1992 - IIB to Joan Williams. f) Letter o f 2 February 1993 - Hamilton Ross to IIB. g) Letter o f 3 Novem ber 1992 - Hamilton Ross to IIB. h) Extract o f transcript o f evidence o f Mr Padraig Collery dated 11 January 2000 . n Inreplyto:Letterof 28thMarch,2000under Officeof dieInspectorsappointedbyOrderof theHighCourttoAnsbacher(Cayman)Ltd 3rdFloor TridentHouse Bkduodc Co. DubKn DearSirs&Madam ' 0 9 HAY 2 MB Apologiesforthedeiayinrespondingtoyourletter. GenetAl I confirm,aa behalf of theEstateof mylateEitherthatI amanxioustoaffordyouallpotubk mconnectionwith your hiveatigatioa. I do not believe that I currently have mudi my possessionrelevanttoyourenquiriesWhenthismatter first sroseI madea numberof enquiries, through Guinness Sc Mahon, whohadnotifiedmeof thematter. Theinformationtheygave mewasverylimited andamountedtoaleverarchfilewithvariouscopystatementsof IrishGuinnessSi Mahonaccountswith oneIrishGuinness & Mahonloanapparentlynoted as securedby a Caymanrelateddeposit Despite my repeatedrequestsI havenotreceivedanyfartherinformation. I confirmthatI willhappilyissuelettersof enquiry to whatever companies, institutions or bodies whichyou consider may be able to help. I would simply askthat you provide draft letters withclear addresses etc andI will issue same andlet youhave whateverresponsesI receive. Thiswouldseentobethemostefficient andcost effectivewaytoproceed fromhem. {ThemmwMpw4wp«h* fewaawfedtomebyemailatcdillonlglindigo.ie.) Mylat? fatherdied16*January; 1998 afteri relativelybrief illness. I donotbelievehewasawareof your enquiriesbeforehediedandhedidnothavethetimeorabilitytodealwithtudtmattersduringhisfflness. After hediedmymotherdisposedof diefamilyhomeandmovedtoher current homeis August 1998. This movewas fromalarge toa relatively; muchsmallerhouse.This movenecessitatedthedisposal of a lifetime's family memorabilia, Wlmting muchpaper. I believe that 5 large disposal skips were filled and removedatthis time.All paper; notrecognisedai beingof currentvaluehadtobedumpedat thistime. I amnotawareof anypaperrelatedtoAnsbacher(Cayman)Limitedhavingbeendumpedatthis time, butit ispossiblethatitcouldhavehappened. Thiswholematteris s causeof considerable■tressandanguish,-formymotherparticularly, andI hopethat byco-operatingfullyandunequivocallythatf canhelptominimisethedamageandhurttoherandtherest of myfamfljr. . Specific . (1) I havenorecordsavailabletometoenablemedealwithyourrequirements. My onlyunderstandingis that my late father M a longworkingrelationshipwithGuinness 8c Mahon andI believe hemust haveestablishedwhateverrelationshiphehadwithAnsbacher (Cayman) limitedthroughGuinnessSc Mahon. Guinness & Mahonwouldappear to havenot affordedme theinformation I need to deal with your enquiries- I request your help in resolving this impaste. (As per first paragraph above suggestion) (2) I do not believe that I have any books or documents in my custody or power relating to your investigation. I will happilypursuetame, if youcanaffordmethehelp requestedabove, (draftletters and clear addresses etc) I respect of disposal of documents and copy documents please see note abovewhichoutlines howmyfatherslasthomewasdisposedof etc. I cannotprovidealistof relevant 4 THE GROVB -2 - May8,2000 documentsdisposedof asI amnotawareof anyrelevantdocumentsdisposedo£ (3) I note die requirement to attend and give sworn evidence. I hope that we can •work together to generate die documentation. I confirmmywillingness tosubmittothisprocessasappropriate. CadJ. Dillon Executorof theEstate of dielateCharlesT.G, DiDon € i) MEMO M.C.K. to M.J.P. ' 24th October, 1936. Patrick M. Dillon Professor C. Dillon. I have discussed above with D.P.C. The balance on the loan account value 1st October, 1965, being £13,716.36 will, until further notice, be in the offset category at zero rate and will be backed by a deposit in the name of Oakland investments (GMCT) for the same amount in external Irish pounds also at nil rate. The balance to clear Sundry Persons i.e. £1,283.64 is being credited to C.J.D's current account. J* HCK/BK ■ P.O. Box 887. Grand Cayman. Cayman Islands. British West Indies D u b lin 1 Facsimile: (809) 949-7946. (809) 949-526" Tel: 765144/763065 Fax: 612035 ' 8th January, 1993, Ronan Redmond, Esq., Corporate Services, Irish Intercontinental Bank Limited, 91 Merrion Square, DUBLIN 2. Dear Ronan, I enclose herewith U.S. Dollar ch iue for US$16,296.91. Could you please arrange to credi/ this as follows: Hamilton Ross Account Ref. A/A No.03/39317/81^ '57 No.03^392657b}K Hamilton Ross Account Ref. 58 No.03/39273/81 Hamilton Ross Account Ref. A^A58 Yours sincerely, For HAMILTON ROSS t o . LIMITED JDT/AJW , / - rV rL • $7,875.00 ^ S $4,667.00 1/ ✓ Please reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 676 5144/676 3065 Fax: 6612035 P.O. Box 887, Grand Cayman, Cayman Islands, British Wesi Indies Telephone; (809) 949-8655 Telex; CP 4305 Facsimile: (809) 949-7946, (809)949-5267 23rd September, 1994. Ms. Daire Nolan-Cassidy, Corporate Services, 91 M errion Square, DUBLIN 2. Dear D aire, ; r*. 'j'' • ' PnnlH you please arrange to let us have for coUectiotaanTrish Bouiids’cheque for thi Irish Pounds equivalent o f U S$36,000.00 payable to C.TI(y, and debit the cost to Ham ilton R oss U .S. Dollar Account Ref. A /A 57 N o.03/39265/81. . Yours sincerely, For HAM ILTON ROSS CO. UMEEEB /AJW " r> IBISH IN T llC O N T IM IN T A t 1 ANK 16 December, 1992 Ms. Joan Williams, 42 Fitzwilliam Square, Dublin 2. Re: Hamilton Ross Co. Ltd. - New Account Numbers Dear Joanf ■ . • . • We confirm the following new account numbers for the Hamilton Ross USD accounts:~ Ref X/A57 03/39265/81 Kind regards, Yours sincerely, . for Irish Intercontinental Bank Limited CORPORATE SERVICES 1»«3H IK T U C O K T lN V N T A t *A M X UM TTXO . » 1 M tM JO N S Q U A JO . D U » U N X • T tilf H O N t. 0 1 6 1 9 7 • JA C 5 4 M IU . 0 1 7 1 3 0 1 * ' T tL iX . U J U xuuuuum Plemscreplyto: 42FltrwflHsmSqiuze, Dublin2. m 76514V763065 ftr 612035 m w u t. um nea PX).Bo*8*7,GrtodCajrnaa.CftynunblMds.BritishWe» Indies Tetepfcope(809)949-8653 TelocCP4303 ' ftorimile (809)949-7946. (809)949-5267 2nd February, 1993 Bonan Bedmond, Isq., Corporate Services, Iriah Intercontinental Bank Limited, 91 Herrion Square, PPBLIH 2. Dear Ronan, With reference to the Swiss Franca recently received from Zurich-totalling Sw.Fes.276,420.30 which you ere holding on Call Deposit, could you please arrange to convert 60,000 of these Swiss Franca to Irish founds and let me heve for collection an Irish Founds cheque for the resulting amount payable to C. DILLON. Could you then please convert the balance on that Swiss Francs Account to U.S. Dollars and add to Hamilton Boas Account Bef. A/A57 No.03/39265/81. In due course it would be apprecieted if you could advise details of the transactions. Yours sincerely, \ Fox HAMILTON BOSS CO. LIMITED \>U-&o3 P.O.Box 117,Grand Cayman, Cayman Islands, Bricish W«« 42 FitzwUliam Square, Dublin 1 Tel: 765144/763065 F ar 612035 Kon&n Rednond , Esq ., Corporate Service*, Iriah Intercontinental Bank Limited, 91 Marrion Square, DUBLIN 2. ■ Telephone: (809) 949-8655 Tel.*: CP 4305 Ftainiil* (109) 949*7946 (809) 949-5267 3rd November, 1992. Deaf Honan, Could you plea a a arrange to lat na have for collection - Friday morning at the latest - an Zriah Pound* cheque for XR£10,000 payable to C.T.G. Dillon and debit the coat to Hamilton Roaa Account No.02/01354/81. For HAMILTON ROSS CO. LIMITED 1 on the list on Hamilton Ross, this would be helpful 2 to us. 3 names of the people who are clients of Hamilton 4 Ross? 5 6 394 Have you any objection to giving us the A. Not at all, they are within this list. Q. So that all the list of clients of Hamilton Ross who 7 were clients of Ansbacher are there and maybe are 8 there some people on the Hamilton Ross list who are 9 not clients of Ansbacher? 10 A. I think at all stages, at the previous stage of the 11 life of Ansbacher they had a connection or 12 relationship with the Ansbacher and they moved 13 across into Hamilton Ross. 14 know of, that never had a relationship with 15 Ansbacher in Hamilton Ross. 16 a relationship with Hamilton Ross... (INTERJECTION). 17 395 Q. 18 Would have had a previous relationship with 396 A. That iB as I understand it. Q. How many people are we talking about, how many ‘ ' J* . accounts are we talking about? 21 22 23 So that anybody who has Ansbacher? 19 20 There are none, that X 397 A. About 60. Q. That is on your list and I am just wondering are all 24 those 60, do they all go over to Hamilton Ross or do 25 you know were many people on the bureau system that 26 would have been on Hamilton Ross? 27 a . Over the years the bureau list, again it is what I 28 can gleam from a listing, would have been about a 29 hundred odd accounts in total at any one time. 92 So A p p e n d ix X V (2 8 ) M r T e r e n c e D E D ix o n 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Terence D E Dixon. a) Transcript of evidence o f Mr Michael O’Shea dated 19 June 2001. b) Statement of Michael O’Shea. c) Letter of 16 March 2001 - Michael O’Shea to the Inspectors. d) Internal Guinness and Mahon memo - JDT to P O’D o f 5 September 1984. e) Letter o f 2 May 1985 - DJ Barry to the Greffer’s Office, Guernsey. f) Letter of 18 May 1992 - Joan Williams to Ronan Redmond, IIB. g) Statements of Account A/A54. h) Foreign Dealing tickets - Hamilton Ross. Correspondence received from or on behalf o f Mr Terence D E Dixon. a) Letter o f 14 December 2001 - Mason Hayes & Curran to the Inspectors. b) Letter of 15 January 2002 - Mason Hayes & Curran to the Inspectors. UNDER OATH ON TUESDAY, 19TH JUNE 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: HIS HONOUR JUDGE 0 LEARY MS. MACKEY BL Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MR. MICHAEL O'SHEA Represented by: MR. KEVIN BARRY McGONAGLE KENNEDY BALLAGH WITNESS MR. M. I EXAMINATION JUDGE PAGE 48 1 2 3 4 5 JUDGE O'LEARY: I note your statement 6 with regard to the 7 voluntariness of your attendance and that is 8 accepted, Exhibit 1. 9 MR. O'SHEA: That is accepted. 10 JUDGE O'LEARY: By the Inspectors. 11 MR. O'SHEA: Thank you. 12 JUDGE O'LEARY: Yes. 13 Thanks. That is a fairly standard procedure 14 nowadays I think. 15 MR. O'SHEA: It is 16 JUDGE O'LEARY: It is indeed. 17 MR. O'SHEA: It is, yes. 18 JUDGE O'LEARY: Thank you very much indeed for attending, Mr. O'Shea. 19 20 My name is Sean O'Leary. 21 Inspectors. 22 pleasure of meeting before. 23 is the other Inspector. 24 MR. O'SHEA: I do not think we have had the 25 26 29 Ms. Noreen Mackey I have met Ms. Mackey before. JUDGE O'LEARY: 27 28 I am one of the You have met Ms. Mackey before. MR. O'SHEA: Yes. 1 2 3 JUDGE O'LEARY: 4 The position is that there are, as you know, four 5 Inspectors but only two of the Inspectors will 6 be dealing with any matter touching on anything 7 we talk about here today to you. 8 MR. O'SHEA: Yes. 9 JUDGE O'LEARY: Obviously, we have had to 10 divide up the work and 11 that is the way it is divided so far. 12 MR. O'SHEA: I understand, yes. 13 JUDGE O'LEARY: The position is that we 14 have a number of questions 15 to ask you both in your own personal capacity as a 16 member of a firm of solicitors and also in your 17 capacity as one of the persons named with legal 18 authority in the Will of the late Mr. McGonagle. 19 MR. O'SHEA: Indeed. 20 JUDGE O'LEARY: Yes. 21 So, it is in those two capacities. 22 MR. O'SHEA: Yes. 23 JUDGE O'LEARY: It is a very informal 24 procedure. There is only 25 one formal part of it as you know and that is the 26 question of taking the oath. 27 MR. O'SHEA: 28 29 Yes. 1 2 JUDGE O'LEARY: I note that you have a 3 solicitor here with you. 4 You probably will not need it but if you feel like 5 consulting with the solicitor at any time by all 6 means just tell us "Stop" and we will stop and you 7 can of course consult with your colleague. 8 MR. O'SHEA: Yes. 9 JUDGE O'LEARY: And similarly if your 10 colleague feels that it 11 is in your interest that we should stop at any time 12 all he has to do is to say "Stop" and we will allow 13 the interruption. 14 MR. O'SHEA: That is why Kevin is here. 15 JUDGE O'LEARY: What? 16 MR. O'SHEA: That is why he is here. 17 JUDGE O'LEARY: That is why he is here, 18 yes. I think you are 19 wise. 20 pair of eyes and ears there. 21 MR. O'SHEA: Right, yes. 22 JUDGE O'LEARY: I wonder if you would take People are wise always to have another 23 the oath now and we will 24 get on to asking you the questions we have. 25 MR. O'SHEA: 26 27 28 29 Yes. 1 2 3 4 5 1 Q. JUDGE O'LEARY: 6 Mr. O'Shea, the position is that most of the 7 connections which we have discovered relate, I 8 would think it is fair to say, to the activities 9 of the late Mr. McGonagle? 10 A. 11 2 Q. Yes. I think that is a fair summary. There are however 12 a number of things relating to your firm to which 13 we would also like to refer? 14 A. 15 3 Q. Yes. However, in order to put the matter straight you 16 were appointed under the Will of Mr. O'Shea to be 17 the Executor and Trustee of his Estate? 18 A. Of Mr. McGonagle. MS. MACKEY: 19 20 A. 21 4 Q. Mr. McGonagle. Yes . JUDGE O'LEARY: 22 Of Mr. McGonagle I should say? 23 A. Yes, I was. 24 Q. You were? 25 A. One of them. 26 Q. Yes. 27 A. That is right. 28 Q. Yes. 29 A. 0'Reilly-Hyland. One of two of them I think? The other one being a Mr. 0'Reilly-Hyland? 1 8 Q. 2 A. No. 3 9 Q. No? 4 A. No, I renounced my rights. 5 10 Q. You renounced your rights? 6 A. 7 11 Q. 8 A. His widow. 9 12 Q. His widow? 10 A. 11 13 Q. 12 A. 13 14 Q. 14 A. 15 15 Q. 16 A. 17 16 Q. 18 A. 19 17 Q. Did you exercise that power? Yes. Who in fact exercised the power? Barbara. Yes. As the heir at law is it? As the residual legatee. As a residual legatee? Yes. All right. Did you act in that matter? Yes. Yes, you did. In a professional capacity for him? Yes. One of the problems that we have had in dealing 20 with the case of Mr. McGonagle is that we have to 21 accept that the widow of Mr. McGonagle was only 22 very recently married to him? 23 A. 24 18 Q. That is true, yes. And she has sent us in various statements with 25 regard to her state of knowledge which we accept; 26 I mean from a practical viewpoint? 27 A. 28 19 Q. 29 A. Indeed. You are probably aware of those statements yourself? Yes, I am. 1 20 Q. 2 A. 3 21 Q. 4 A. 6 22 Q. 7 A. 8 23 Q. 9 A. 10 2 4 Q. 11 I mean from your own personal knowledge are we Well, I would have thought so. Yes? I mean she...(INTERJECTION). You...(INTERJECTION)? I mean...(INTERJECTION). From your own knowledge does she know anything about the situation? A. Well, I can never be certain but I know...(INTERJECTION). 13 14 25 Q. 15 A. 16 Of course I understand that? But I know Liam was an extraordinarily close, careful, prudent and secretive man. 17 26 Q. 18 A. 19 27 Q. 20 A. 21 28 Q. 22 A. 23 24 I am aware of them. wise to give credence to those do you think? 5 12 Yes? Yes? He didn't volunteer information to anybody. Yes? And least of all to his wife. Yes? Now, I mean I gleaned information over the years from time to time. 29 Q. 25 I understand. I was never told, you know? So, it is entirely consistent that she would not know anything really significant? 26 A. 27 30 Q. 28 A. 29 31 Q. It certainly is, yes. All right. We actually accept that? Yes. And we will of course reflect that in any decision 1 which we have to take; of course. 2 us in somewhat of a difficulty because it would 3 be not unfair to the late Mr. McGonagle to say that 4 his name crops up on a number of occasions through 5 the course of our investigation? 6 A. 7 32 Q. 8 A. 9 33 Q. 10 A. I haven't seen...(INTERJECTION). 11 34 Q. You have not seen it; all right? 12 A. 13 35 Q. That however puts Yes. Both as a solicitor and as an individual? Yes. I think that...(INTERJECTION)? I have seen some. All right. The problem which we are faced with is: 14 We must identify the clients of the Company we are 15 investigating? 16 A. 17 36 Q. 18 A. 19 37 Q. 20 A. 21 38 Q. 22 A. 23 39 Q. 24 A. 25 40 Q. 26 A. 27 41 Q. 28 29 Yes. Which is "Ansbacher"? Yes. We are not investigating Mr. McGonagle? Yes. We are not investigating you? Yes. We are not investigating anybody? Yes. We were investigating the Company? Yes. However, one of the jobs that has been given to us is that we must identify the clients of the Company. A. Right, yes, yes. 1 42 Q. 2 was a client of "Ansbacher" or not? 3 A. 4 43 Q. 5 A. 7 44 Q. 8 A. 9 He never told me. Yes? But I did obviously advise him in a number of and...(INTERJECTION). 11 45 Q. 12 A. 13 46 Q. 14 A. I do not want t o ...(INTERJECTION)? And also...(INTERJECTION). I do not want t o ...(INTERJECTION)? I also advised him. So, I am not sure if I can answer that. 15 47 Q. 17 I do not want any information which you got exclusively from giving him advice? 18 A. 19 48 Q. 20 A. 21 4 9 Q. 22 Yes. I do not want that information? Yes. That would be improper and I do not want that information? 23 A. 24 50 Q. 25 Yes. Other than that are you aware of any such connection? 26 A. 27 51 Q. 29 Do you know whether he was or not; directly or respects in connection with a visit to a Tribunal 10 28 Yes. indirectly? 6 16 Obviously, we have to consider whether Mr. McGonagle He would never have told me. Yes, yes. Do you know for example of the existence of a company called Camille Investments Ltd? 1 52 Q. 2 3 Yes. Had you any connection yourself with the Company? A. 4 No, no, but I knew it was an investment company of Liam's. 5 53 Q. 6 A. 7 54 Q. 8 A. 9 55 Q. Of Liam's? Yes. Did he own it himself? He did. He did, yes, yes. It may have been, the shares may 10 have been, in different person's names from time to 11 time but I think he was the beneficial owner at all 12 times ? 13 A. 14 56 Q. 15 A. 16 57 Q. 17 A. 18 58 Q. 19 A. 20 59 Q. 21 I would have thought so, yes. Yes? I don't think they were in anybody else's name. They may? But I may...(INTERJECTION). They may have been but...(INTERJECTION)? I mean I wouldn't necessarily know. Yes, yes. I will just show you a letter of the 30th March 1988, Exhibit 2? 22 A. 23 60 Q. 24 Yes. Which I think is Mr. McGonagle's own acknowledgement that he owns the Company? 25 A. 26 61 Q. Right, yes. Because obviously unless we know who owned the 27 Company we could not proceed on any basis 28 (Same Handed), Exhibit 3? 29 1 62 Q. 2 A. 3 63 Q. 4 It seems clear enough? Yes, it does, yes. And I mean I am just giving you an opportunity of looking at it? 5 A. 6 64 Q. 7 Yes, yes. In case you say, "That is all wrong. He only did that because of X, Y or Z"? 8 A. 9 65 Q. No. All right. There are two other pieces of evidence 10 which I want to put to you as a person who might 11 know something about it? 12 A. 13 66 Q. 14 Yes, yes. And, of course, I accept you might not also know anything about it as well? 15 A. 16 67 Q. Yes. However, I think in fairness to the late 17 Mr. McGonagle somebody had better be told about 18 these pieces of information because otherwise 19 it would be quite improper and I think you are 20 the appropriate person. 21 memo dated the 16th August 1978. 22 is "internal" it is internal to Guinness Mahon 23 Ireland (Same Handed)? 24 A. 25 68 Q. 26 When I say it Yes, yes. You may have already seen that in another context. I am not sure whether you have or not? 27 A. 28 69 Q. 29 There is an internal I probably have seen this before. You probably have seen it? 1 70 Q. There are three matters that I want to point out 2 to you there. 3 Mr. Turvey is to me? 4 5 A. 71 Q . 6 A. 7 72 Q. 8 A. 9 73 Q. 10 A. 11 74 Q . 12 A. 13 75 Q. 14 15 Mr. Turvey: Would you explain who He is a friend of Liam McGonagle's. Yes ? Was a friend, yes. Yes. Is he an accountant or is h e ...(INTERJECTION)? He is an accountant; he is. Is he? Yes. Yes? Though he has't ...(INTERJECTION). Has he a Haughey Boland background or...(INTERJECTION)? A. No, he hasn't. He has always -- I don't think he 16 has ever practised as a professional accountant. 17 He has always been in business. 18 76 Q. 19 A. 20 21 And -- but he was a friend of Liam's since -- from his school days. 77 Q. 22 Yes. He seemed to have carriage of a lot of matters relating to Camille Investments Ltd over the years? 23 A. 24 78 Q. 25 A. 26 79 Q. 27 A. 28 80 Q. 29 Yes? They were very friendly. Do you know that of your own knowledge? Well, they were friendly, you know? Yes? And...(INTERJECTION). However, do you know whether he had a lot of 1 A. 2 I think Liam would have relied on him from time to time, yes. 3 81 Q. 4 A. 5 82 Q. Yes? 6 A. Yes. 7 83 Q. 8 From time to time? Yes. There are two other matters I want to refer to you: Do you see the expression: 9 10 "This is a suitably secured situation"? 11 12 A. 13 84 Q. Yes. We have been informed by Guinness & Mahon that 14 "suitably secured" in that context means the 15 following: 16 it was being borrowed on a back-to-back basis 17 against money which was on deposit outside this 18 jurisdiction. 19 Ireland. 20 A. 21 85 Q. 22 A. 23 86 Q. 24 That may have been the North of It may have been the Channel Islands? Yes. Or it may have been the Cayman Islands? Yes. Do you know whether Camille Investments had any such money of your own knowledge? 25 A. 26 87 Q. 27 A. I would be very surprised if it had. Yes? I would be -- Camille Investments was an Irish company. 28 29 That money was being borrowed and 88 Q. Yes? 1 A. 2 So, I don't think Camille would have had any funds outside of the jurisdiction. 3 89 Q. 4 A. 5 90 Q. 6 A. 7 91 Q. Yes? But again I can't be certain. Yes, I understand? But I would be very surprised. If it was being backed by funds outside the 8 jurisdiction they were probably held in another 9 name? 10 A. 11 92 Q. 12 That's a possibility. Yes. Because you can see in the bottom that it says : 13 14 "In the meantime I have asked E.McL. to hold dollars in excess of 300,000.00 held on deposit from G.M.C.T to our order." 15 16 17 18 A. 19 93 Q. Yes. One of the conclusions the Inspectors might draw 20 from that and of course they can be persuaded to 21 draw a different conclusion if that is appropriate? 22 A. 23 94 Q. Yes, yes. One of the conclusions they might draw from it is 24 that Camille Investments and its owner had access 25 to backing deposits in Guinness Mahon Cayman Trust, 26 which was an earlier name of "Ansbacher". 27 have any information to confirm or dissuade us from 28 adopting that course of action? 29 A. Do you I would be I suppose giving privileged information 1 2 95 Q 3 I am not interested in the privileged information. Other than privileged information...(INTERJECTION)? 4 A 5 96 Q 6 A 7 97 Q 8 A 9 98 Q 10 A 11 I am...(INTERJECTION). You can forget you know privileged information? I am...(INTERJECTION). Forget that? I ...(INTERJECTION). You do not know? I know I have come across the phrase "suitably secured" on many occasions. 12 99 Q 13 A 14 100 Q 15 A Yes ? I know how Guinness & Mahon interpret that phrase. Yes? I am not sure that it was always interpreted -­ 16 it always reflected the actual position. 17 come across situations where I think it might have 18 been convenient for Mr. Traynor to say to his 19 lending committee, 20 101 Q 21 A Yes, I understand. I have "This is adequately secured". Yes? Whereas in fact it wasn't but he would have known 22 the borrower and would have been quite happy. 23 I cannot give you any instances off the top of my 24 head of that but I certainly have come across one 25 or two instances of that. 26 102 Q Yes. Now, However, Mr. O'Shea, that line of "Defence" 27 hardly passes muster in this case when in the course 28 of the same memo there is a specific request? 29 A 1 103 Q 2 To set aside 300,000 US dollars, presumably US dollars, which are apparently in G.M.C.T? 3 A 4 104 Q 5 Indeed. So, I think that "Defence" which might be open to some people hardly applies to this document? 6 A 7 105 Q Right, indeed. You see the point I am making; that is all I am saying? 8 9 A 10 106 Q I see the point you are making of course. All right, grand. The third piece of evidence 11 that we have which would indicate a connection 12 between Camille Investments Ltd and "Ansbacher", 13 and therefore of course indirectly with 14 Mr. McGonagle, is a memo dated or a letter dated 15 the 11th March 1990 from Mr. Lanigan-0'Keeffe to 16 Mr. Traynor and there is a Schedule attached to 17 that. 18 Mr. O'Shea, I am treating you as a solicitor in 19 this regard: I am going to give you the complete 20 document which includes the names of other people 21 (Same Handed), Exhibit 4? 22 A 23 107 Q 24 Certainly, you can take that...(INTERJECTION). However, I mean you have to undertake to me not to...(INTERJECTION)? 25 A 26 108 Q 27 A 28 109 Q 29 I think in the case of Mr. O'Shea you can -­ Yes . To abide by confidence in that regard? Yes, yes. Mr. Lanigan-0'Keeffe has informed another person, and will in due course no doubt inform us also, 1 that this Schedule was produced by him for 2 Mr. Traynor and it was a Schedule of "suitably 3 secured" loans? 4 Yes . 5 110 Q 6 Persons who had loans through "Ansbacher" that were "suitably secured"? 7 A 8 111 Q 9 Yes, yes. And they included a number of persons including Liam McGonagle? 10 A 11 112 Q 12 A 13 113 Q 14 A 15 114 Q 16 A Yes, yes. All right? Yes, clearly the case, yes. Yes? Yes . Have you any comment to make on that? It could be for a number of factors. I can't -­ 17 obviously it would be speculation -- I think you 18 can speculate; I think may be correctly. 19 seen a number of these (indicating), Exhibit 4. 20 115 Q 21 A 22 116 Q 23 A 24 117 Q 25 A 26 118 Q 27 A 28 119 Q 29 I have I can only go on what Mr. Lanigan-0'Keeffe says? Yes . That is all I can go on? Yes . Because I ...(INTERJECTION)? Yes . It means nothing to me. All it is is a Schedule? Yes, yes. If Mr. Lanigan-0'Keeffe said to me, which I anticipate he will not because he has said it 1 differently to another person, but if he in due 2 course says to me, "Well, I don't know what 3 that list is"? 4 5 120 Q. 6 Well, then I will have to take it to out of my reckoning; do you understand? 7 A. 8 121 Q. 9 Yes. However, if he says what I anticipate he is going to say? 10 A. 11 122 Q. Yes, yes. There can be only one conclusion surely; that 12 conclusion is that Mr. Lanigan-0'Keeffe 13 thought that...(INTERJECTION)? 14 A. 15 123 Q. 16 A. 17 124 Q. 18 19 That these were...(INTERJECTION). That Mr. McGonagle had a "suitably secured" loan? Indeed, yes. Whether that proves it or not; that is a matter of judgment afterwards? A. 20 This was a list of facilities made available by Guinness & Mahon to the individuals. 21 125 Q. 22 A. 23 126 Q. 24 A. 25 127 Q. 26 A. 27 128 Q. With backing? With...(INTERJECTION). To "Ansbacher"? Yes. As you will appreciate...(INTERJECTION)? Yes. As you will appreciate if you look at the date, 28 the 11th May 1990, it can hardly be anything else? 29 MR. BARRY: That is a question you 1 are askrng, Michael, or 2 is that a statement you are making? 3 Well, I am...(INTERJECTION). 4 MR. BARRY: Are you saying that that is a list (indicating), 5 Exhibit 4? 6 7 A 8 129 Q 9 A A JUDGE O'LEARY: A 14 It is a list? So, it is a question? Yes . Yes, right. Yes . M R . BARRY: It sounded like a statement; sorry. 15 16 Yes. It is a list, yes. M R . BARRY: 12 13 I am assuming it is a list. M R . BARRY: 10 11 Well, no. A 17 Yes . JUDGE O'LEARY: I think coaching the witness is neither 18 19 ethical. 20 M R . BARRY: Excuse me; I am sorry. 21 JUDGE O'LEARY: Or certainly necessary. 22 M R . BARRY: Excuse me. 23 JUDGE O'LEARY: With an expert witness like this. 24 25 26 130 Q M R . BARRY: Sorry. JUDGE O'LEARY: However, the reality of the situation as you 27 28 29 will appreciate? A Yes. 1 131 Q. 2 longer had any connection with Guinness & Mahon? 3 A. 4 132 Q. 5 That is right. And he is addressed in the letter as being Mr. J. D. Traynor of "Ansbacher" Limited? 6 A. 7 133 Q. Yes. So, we can take it that it has an "Ansbacher" connection? 8 9 A. 10 134 Q. 11 12 Is that on the 11th May 1990 Mr. Traynor no I ... (INTERJECTION) . We can take it that Mr. Lanigan-0'Keeffe thought it had an "Ansbacher" connection? A. 13 Thought -- well, perhaps he did, yes. Perhaps he did. 14 135 Q. 15 A. Yes. That is a matter that...(INTERJECTION)? Now, I know from talking to Liam that Liam had 16 always had the assets of Camille securing any 17 borrowings he had personally. 18 136 Q. 19 A. 20 And including also the Deeds to No. 29 Molesworth Street. 21 137 Q. 22 A. 23 All right? And insofar as Liam was concerned that was security that they held. 24 138 Q. 25 A. Yes, I understand that? And if there was anything in "Ansbacher" it wasn't necessary. 26 27 139 Q. 28 A. 29 Yes? That may well be the case? Now...(INTERJECTION). 1 2 141 Q 3 A But certainly No. 29 Molesworth Street -- I am 4 not sure had it been sold at that time or not but 5 it was substantially more than the borrowing than 6 was there 7 figure there (indicating), Exhibit 4, and I think 8 also the other assets of Camille would have been in 9 the region of a few hundred thousand pounds. (indicating), Exhibit 4, or the borrowing They 10 were basically investments and again they would have 11 been there as security. 12 or what other records Guinness & Mahon might have 13 in relation to that type of security. 14 142 Q 15 A So, I don't know what else Yes? And whether they would have considered that to 16 be adequately secured or not but I mean I hear 17 what you are saying, yes. 18 143 Q 19 You can take it that their evidence to us has been that adequately secured means offshore? 20 A 21 144 Q 22 A 23 145 Q 24 A 25 146 Q Yes, offshore, yes, yes. It does not necessarily mean Cayman? Yes . However, it means offshore? Yes, yes. All right. The last thing I want to show you in 26 the Camille mode of this is a document signed by 27 yourself apparently (Same Handed). 28 signature (indicating), Exhibit 5? 29 Is that your 1 147 Q 2 A 3 148 Q 4 I have no idea. Whose signature is it underneath? There appear to be two signatures on it? 5 A Yes. That is Des Turvey's signature. 6 149 Q Yes. That is the one which we have seen in many 7 documents dealing with Camille? 8 A 9 150 Q 10 And we will of course in due course deal with that with Mr. Turvey? 11 A 12 151 Q 13 A 14 And that is Mr. Turvey. Who were not the auditors? No. I haven't seen the Company's file. Was I a Director at some stage of Camille? 15 152 Q 16 A 17 153 Q 18 A 19 154 Q 20 A 21 155 Q 22 23 Yes . I do not know? Yes . I am asking you? I honestly...(INTERJECTION). You told me you had nothing to do with the Company. I have...(INTERJECTION). And I am just saying to you that I have come across this document A 24 (indicating), Exhibit 5? I have no idea what -- why my signature is there (indicating), Exhibit 5. 25 156 Q 26 A 27 157 Q 28 A 29 158 Q I wonder if you would have a look at it yourself? Yes . And if you can come up with any explanation? Yes . That would be of assistance to us? 1 2 159 Q 3 A Yes. It is clearly a request to the bank to provide 4 information to Haughey Boland but I cannot tell you 5 in what capacity I signed that 6 Exhibit 5. 7 160 Q 8 Do you see that the document itself says you signed as an authorised signature? 9 A 10 161 Q 11 A 12 162 Q 13 Yes . Were you an authorised signature for that Company? I don't believe so. Yes. I have come across no information that you in fact were an authorised signature of the Company? 14 A 15 163 Q 16 A 17 164 Q 18 19 (indicating), Yes . However, I wonder would you look at it? Yes . And see whether there is any further information you can give us as a result of your investigations? A 20 I will certainly check to see was I a Director at that stage. 21 165 Q 22 A 23 16 6 Q 24 A 25 167 Q 26 Exactly? Yes . I wonder would you do that? Yes, yes. I think it would be of assistance to us if you did that? 27 A 28 168 Q 29 A Certainly, yes. All right? 1 Thank you. 2 Mr. McGonagle's involvement in any other 3 companies with "Ansbacher" connections other 4 than in a . ..(INTERJECTION)? 5 A 6 170 Q 7 A 8 Professional? Yes; professional capacity? I don't think so. Other than in a professional capacity, no. 9 171 Q 10 A 11 172 Q 12 A 13 173 Q 14 A 15 174 Q 16 A No. 17 175 Q No? 18 A 19 176 Q 20 Yes. I am not interested...(INTERJECTION)? Not that I -­ Yes ? I mean a number of companies have come up certainly. Yes? If you...(INTERJECTION). Was he involved in a company called Pine Securities? He wasn't. Was he involved in a company called Beresford Investments ? 21 A 22 177 Q 23 24 Do you know anything about I believe he was. Yes. Were you involved in the Company called Beresford Investments? A No, but I remember it through the office. I 25 think it bought and sold a property and I think 26 lost a small amount of money in the process. 27 178 Q 28 29 Yes. Do you know who the beneficial owners of that Company were? A 1 2 A. 3 180 Q. 4 A. 5 181 Q. Including, yes. Yes. Were you a beneficial owner of the Company? No. That also, according to the records of GMI and 6 that is all I am talking about is the records 7 of GMI? 8 A. 9 182 Q. 10 A. 11 183 Q. 12 A. 13 184 Q. Yes. Had a "suitably secured" loan? Yes, I have seen those. You have seen those? Yes. I have no knowledge as to what that "suitably 14 secured" loan was. 15 as I have in the case of the previous one that I put 16 to you; do you understand? 17 A. 18 185 Q. 19 A. 21 186 Q. 22 A. 23 187 Q. 24 A. 25 188 Q. 26 A. 27 29 Yes. Yes. Were you familiar with a company called British Isle Investments? 20 28 I do not have the same knowledge I have heard the name. Yes. Were you an owner of that Company yourself? No. Had you any interest in the Company? None, none. Did Mr. McGonagle have an interest in the Company? That would be again information I would have gleaned from Mr. McGonagle. 189 Q. In a professional capacity? 1 190 Q. 2 A. 3 191 Q. 4 A. 5 192 Q. 6 Other than that I wouldn't know. You would not know? No, I wouldn't know. However, British Isle Investments Company or whatever the precise name of it was? 7 A. 8 193 Q. 9 A. 10 194 Q. 11 A. 12 195 Q. 13 A. 14 Yes. Was a very famous Company? Yes. I mean it had been the subject of much speculation? Indeed. I think I ...(INTERJECTION). So, I mean it is not just like a . ..(INTERJECTION)? I think I -- yes, I think I know what you are referring to. 15 196 Q. 16 A. 17 197 Q. 18 A. 19 198 Q. Yes. In the United Kingdom? That is right, yes. There was a company investigation? There was. And British Isle Investments was at the very centre of that company investigation? 20 21 A. 22 199 Q. 23 24 However, other than that information? Yes, that is right. Surely at that time quite separate from any advice which you gave him in later life...(INTERJECTION)? A. 25 Well, I remember a little bit about that. There were two UK -­ 26 200 Q. 27 A. Yes? There were two British property developers that 28 Liam had a business relationship with. We -- I 29 think they were involved in a US public -- sorry, 1 a UK company called Norwest Holst Ltd and I think 2 it was in that context that the inquiry arose but 3 I didn't know -- I never knew the details of the 4 inquiry. 5 201 Q of the inquiry? 6 7 I can assure you I have no interest in the details A I know there was a suggestion that in some way 8 they had taken money out of Norwest Holst and -­ 9 but I never knew the...(INTERJECTION). 10 202 Q However, was not the fact of Mr. McGonagle and 11 this British Isle Investments Company central 12 to the issue to be deciding in that inquiry 13 in England and did they not come to Dublin to 14 interview Mr. McGonagle? 15 A 16 I wasn't aware of that. I thought he hadn't been interviewed but...(INTERJECTION). 17 203 Q 18 A 19 204 Q 20 No, he had not? Yes . Because when they came to Dublin he refused to be interviewed? 21 A 22 205 Q 23 A I see, I see. All right. However, you surely must have known that? It is just that I have heard the name but whether 24 it was a company that was solely controlled by 25 these two English property developers or with 26 Liam McGonagle I don't know. 27 206 Q 28 A 29 Yes? It -- I am not sure what the results of the inquiry were either but the...(INTERJECTION). 1 207 Q. 2 3 Yes, I see. However, you do not know anything about that Company as such? A. 4 Other than in the context of professional advice, no. 5 208 Q. 6 A. 7 209 Q. 8 A. 9 210 Q. Yes? I mean I was aware vaguely of the inquiry. Yes? But I can't say I know anything about it. Yes. On the question of professional advice: 10 Ms. Cummins mentions to me, and it is quite true, 11 that the recent law on that matter seems to 12 differentiate between information which a solicitor 13 gets while acting for a Client with regard to who 14 owns a company on the one hand? 15 A. 16 211 Q. 17 Yes. And the advice that he or she tenders to that person arising from that consultation? 18 A. 19 212 Q. Yes. And that all seems to have come down in favour of a 20 solicitor not being able to exercise privilege with 21 regard to information with regard for example to the 22 ownership of a company? 23 A. 24 213 Q. 25 A. 26 Is that not the current state of the law? I thought it was -- I mean I bow to your knowledge in that regard, Judge. 27 214 Q. 28 A. 29 Well, I think they...(INTERJECTION). Yes? But I did look at Judge Kelly's decision in the Miley -v- Miley case and he clearly said there you 1 cannot -- you must disclose the name of your client. 2 215 Q 3 A Yes ? And he decided, or he confirmed I think the legal 4 position, that legal assistance isn't privileged. 5 Legal advice is, which I think is the sort of 6 language he used. 7 216 Q 8 Any way, Mr. O'Shea, I am not going down that road; I can assure you? 9 A 10 217 Q Yes . Because with regard to Mr. McGonagle I certainly 11 have enough information to be able to make a 12 decision whether or not he was a client of 13 "Ansbacher"? 14 A 15 218 Q Okay, indeed. I may be a bit deficient with regard to being 16 able to precisely define the extent to which he 17 was a client? 18 A 19 219 Q Okay, yes. However, I do not think that is sufficiently 20 important to my investigation of "Ansbacher" 21 for me to go to the scaffold over it? 22 A 23 220 Q 24 A 25 221 Q Indeed, yes. Do you understand what I mean? Indeed. If it was necessary and if it was a matter of 26 life or death I would pursue the matter further 27 with you but I am not interested in pursuing 28 the matter further with you at this stage for 29 that reason? 1 2 222 Q All right? 3 A Thank you. 4 223 Q 5 I come now to the question of the relationship between "Ansbacher" and your company? 6 A 7 224 Q 8 A 9 225 Q 10 A 11 226 Q Yes . A firm of solicitors? Yes . And we have received your statement in that regard? Yes . And it is helpful and thank you very much indeed 12 for the statement, Exhibit 6. 13 assistance to us. 14 for Cayman International Bank & Trust Company 15 Limited, which was another of the names of 16 "Ansbacher"? 17 A 18 227 Q It is of considerable We know that your company acted Yes . And really we are not interested in that. We 19 really have no concerns with regard to that. 20 You are entitled to act for those people if 21 you want. 22 1993 situation? 23 A 24 228 Q However, we are interested in the Yes . About this fee apparently that was paid by a UK 25 Client of the firm. 26 approximately? 27 A 28 229 Q 29 What was the amount of that I do not want the...(INTERJECTION)? Approximately £40,000. £40,000, yes. somewhere? Do you know how long it was invested 1 I would hazard a guess and say a number of months; 2 may be up to five or six months perhaps. 3 230 Q 4 A 5 231 Q Yes ? May be shorter. Yes. If I was to tell you that our information is 6 that it was in Hamilton Ross rather than Kentford 7 would you know whether that is right or wrong? 8 A 9 232 Q 10 A 11 233 Q 12 I won't. Yes ? I know the payment came from Kentford. Yes. However, I think Kentford was merely a device used for making payments? 13 A 14 234 Q 15 A 16 235 Q 17 A 18 236 Q 19 A 20 237 Q 21 May be so, yes. Do you understand? May be so, yes. It was not an investment vehicle? Yes, yes. Insofar as we have been able to ascertain? Yes . Kentford was the mechanism by which money was paid to Irish people? 22 A 23 238 Q 24 Yes . From money which had been abroad; do you understand what I mean? 25 A 26 239 Q 27 A 28 240 Q 29 A Yes, I do, yes. Yes. That was...(INTERJECTION)? I do, yes. So, as far as you were concerned it was Kentford? Yes . 1 241 Q. Do you remember the circumstances in which it was 2 put where-ever it was put; leaving aside for the 3 moment where it was put? 4 A. 5 242 Q. 6 A. 7 243 Q. 8 A. 9 244 Q. 10 A. 11 245 Q. 12 A. 13 246 Q. 14 I think it was probably Liam's idea. Yes? To route it through Des Traynor. Yes? And Liam possibly mentioned it to me. Yes? In any event it happened. Yes? And subsequently payments were made by Kentford. Yes. Were you familiar at that time with where it was going yourself? 15 A. 16 247 Q. 17 A. 18 248 Q. No, I had no idea. You had no idea? I had no idea. When you say it was "Des Traynor" do you think 19 it was coming to Des Traynor in Ireland or it 20 was coming to Des Traynor where? 21 A. 22 24 9 Q. 23 A. Well... (INTERJECTION) . Or did you know? Obviously, I knew of Des's connection with 24 Guinness & Mahon. 25 as to what other banking connections he had. 26 Obviously, at that time he was no longer in 27 Guinness & Mahon. 28 29 250 Q. I didn't give it any thought I mean he had left Guinness & Mahon at that stage for five years? 1 That is true, that is true, but in any event he 2 was happy to facilitate Liam and did and I didn't 3 really think very much about it one way or the 4 other. 5 Yes. 6 or not -- it was then eventually brought into this 7 Country. 8 was it, and distributed between you? 9 A 10 252 Q 11 You are not familiar, are you, with whether The money was brought into this Country, It was distributed to the partners, it was. And where did it end up? Did it end up in the firm's account or where did it end up? 12 A 13 253 Q 14 A 15 254 Q 16 A 17 255 Q 18 A 19 256 Q No, it ended up in the partner's account. In...(INTERJECTION)? Individually. Within the firm? Individually. Individually? Yes, individually. Individually, yes, I see. Was it expected that the 20 partners would make whatever returns were necessary 21 arising out of that? 22 A Yes . 23 257 Q Yes ? 24 A 25 258 Q Yes ? 26 A Yes . 27 259 Q 28 29 Well, if they were doing it, yes. And was this money earned abroad or...(INTERJECTION)? 1 260 Q 2 A 3 261 Q 4 Yes, it was a UK Client as I recall. Yes, I see, I see. Do you remember the time of the year in 1993 that you received that money? 5 A 6 262 Q 7 A 8 263 Q 9 A 10 I don't remember. I wonder could you find that out for us? I could. Yes? Yes, I could. I think there may be some correspondence. 11 264 Q 12 A 13 265 Q 14 A 15 2 66 Q Yes. Well, that is fair enough? But I will certainly see if I can find that out. Yes. That would be of assistance to us? Yes . It always seems to us that there was a small balance 16 remaining in Hamilton Ross after the payment was 17 made even as late as the 31st December 1993 of 18 some £1,24 0? 19 A 20 I think there was. I think that may have been interest. 21 267 Q 22 A 23 268 Q At a later date? 24 A At a later date. 25 269 Q 26 Yes? Which was subsequently divided again. Yes. I wonder would you just give us the dates of those? 27 A 28 270 Q 29 A Certainly. It would be of considerable assistance to us? 1 271 Q 2 A 3 272 Q All right? Okay. Thank you very much indeed. That is grand. 4 Have I -- from time to time -- as you say in 5 your statement, Exhibit 6: 6 respected the firm and I am not concerned about 7 that November 1993 instruction that you received. 8 Had you ever acted for the Firm before that? 9 A 10 273 Q 11 A 12 274 Q 13 On one occasion you No, not to my knowledge. No, not to your knowledge? Yes . I see, okay. Had you ever received money from the Firm before that? 14 A 15 275 Q No. All right. We have, I have, two other documents 16 to show you. 17 its frailty to you because I do not like making 18 claims for documents that I cannot stand over, as 19 you will appreciate. 20 Ms. Cummins, please 21 A 22 276 Q 23 A 24 277 Q 25 This is a document at page 28, (Same Handed), Exhibit 7? Thanks. This is a memo from Mr. Traynor to Mr. O'Dwyer? Yes . They were both working in Guinness & Mahon at the time? 26 A 27 278 Q Yes . On the face of it it looks just like a Guinness & Mahon payment? 28 29 One really is and I want to explain A 1 279 Q. There are however if you like two aspects of 2 the matter which give rise to some possibility, 3 and I am not putting it any stronger than that, 4 of an "Ansbacher" connection. 5 that it was a sterling draft? 6 A. 7 280 Q. One is the fact Yes. Which was a little unusual if the money was 8 in Ireland in ordinary circumstances, and secondly 9 Redshank Investments. 10 11 Company? A. 12 13 Have you heard of that I have heard of that again in a professional capacity, yes. 281 Q. Yes. That Redshank Investments, the Inspectors 14 believe, had a connection with McGonagle. 15 Inspectors believe that? 16 A. 17 282 Q. 18 A. 19 283 Q. The Yes. We are not asking you to confirm or deny that? Yes. And that it may well have had an "Ansbacher" connection? 20 21 A. 22 284 Q. 23 A. 24 285 Q. 25 A. Yes. Do you know anything about that payment? I have a vague memory I have to say. Yes? But only that. I can't say in what context it is. 26 The other people named were partners in the firm. 27 So, it may be in that context that this payment 28 was made but I cannot...(INTERJECTION). 29 286 Q. It is like as if it is a division of some money 1 between partners in the Firm with Mr. McGonagle's 2 section going to Redshanks? 3 Indeed. 4 287 Q 5 A 6 288 Q Is that not what it looks like? Indeed. The source of that fund, of those funds, are a 7 cause of concern to us. 8 think about that? 9 A 10 289 Q 11 A 12 290 Q 13 A 14 291 Q 15 A 16 292 Q 17 A 18 293 Q 19 A 20 294 Q 21 A 22 295 Q I wonder would you I will, yes. And would you revert to us with regard to that? Yes, I will. I do not want t o ...(INTERJECTION)? I can't recall now. Yes, I understand? Yes . I understand that? Yes . However, it may be worth while thinking about it? Yes . All right? Certainly. The difficulty about this payment as far as we are 23 concerned is that it mentions you by name rather 24 than the Firm? 25 A 26 296 Q Indeed, yes. Of course we have to be very careful and we will 27 be very careful and certainly we will be very 28 careful in respect of any payment of £1,650? 29 A 1 297 Q 2 A 3 298 Q Which is not even in 1984 an amazing sum of money? Yes . However, at the same time we have to satisfy 4 ourselves that it does not have an "Ansbacher" 5 connection? 6 A 7 299 Q 8 A 9 300 Q Yes, indeed. So, any assistance you can give us in that regard? Fine, yes. Otherwise we may have to go and investigate it. 10 We have not really investigated it that much at 11 this stage? 12 A 13 301 Q 14 A 15 302 Q 16 A 17 303 Q 18 Yes, okay. However, if you can satisfy us so be it? Very well. We will just let it stand at that; all right? Certainly. All right. That is one -- you might come back to us on that, Mr. O'Shea? 19 A 20 304 Q Yes, I will. The other thing is this: I wonder would you just 21 show Mr. O'Shea number 29 as well 22 Exhibit 8? 23 Investments as being a Client of College Trustees. 24 You can take it that at that stage our information 25 is that College Trustees' funds, not necessarily all 26 of them but many of the College Trustees' funds 27 which they had invested for clients, were routed 28 for some inexplicable reason through "Ansbacher"? 29 Yes, I see. (Same Handed), That has -- that shows Redshank 1 So, here you have a situation where we know that 2 Redshank Investments Limited was a College Trustee 3 client. 4 after that, it had informed various parties with 5 regard to the Registered Office and we know that 6 Redshank Investments is connected with the 1984 7 payment. 8 mathematically prove it at this stage that Redshank 9 Investments was a Liam McGonagle company but we We know that in 1985, which was the year We are of the belief but we cannot 10 believe that to be the case. 11 those things together we had a certain concern? 12 A 13 306 Q 14 Putting all of Yes . And I will not put it any stronger than that; all right? 15 A 16 307 Q Yes . The only other document I want to show you, 17 Mr. O'Shea, is this: 18 document. 19 A 20 308 Q 21 A 22 309 Q 23 A 24 310 Q It is a 18th May 1992 It is page 30 (Same Handed), Exhibit 9? Thanks. That does not appear in your statement, Exhibit 6? No, and I have no recollection of it. Yes? I have no idea what it is for. I wonder would it be an earlier part of the £40,000 25 even though the £40,000 was there in December 1992? 26 Could it have been £50,000 and could this be £10,000 27 of it? 28 29 A I don't think so. 1 2 312 Q 3 You do note that they are talking about "Ansbacher" Limited? 4 A 5 313 Q 6 A 7 314 Q 8 Yes, I do. Rather than Hamilton Ross? Yes . However, you can take it that Hamilton Ross and "Ansbacher" were interchangeable? 9 A 10 315 Q 11 A 12 316 Q 13 Indeed, yes. Names used by these parties? Yes, indeed, yes. And I would not attach too much significance to that ? 14 A 15 317 Q 16 Yes . However, you can see that it is a payment not to Mr. McGonagle? 17 A 18 318 Q 19 A 20 21 You think it is separate from that. Yes, Kennedy McGonagle Ballagh. But to Kennedy McGonagle Ballagh? Yes, I can see that. I can see that. I am -­ I have no idea what for. 319 Q 22 I wonder could you investigate that? There is bound to be a record of that somewhere? 23 A 24 320 Q 25 A Yes. 26 321 Q Yes? 27 A 28 322 Q 29 A Yes . It is only 1992? Yes, I agree. I agree. I wonder could you give us an explanation of that? Certainly, okay. 1 323 Q 2 A None. Not at this point in time any way I don't 3 but I certainly will -- I mean we can check our 4 ledgers and find out from that; hopefully find 5 out from that. 6 324 Q 7 You see could I explain where we are going, Mr. O'Shea? 8 A 9 325 Q 10 A 11 326 Q 12 Yes, yes. So that everybody understands where we are? Yes . We will have to consider all the evidence as to whether Mr. McGonagle was a Client of "Ansbacher"? 13 A 14 327 Q Yes . Obviously I cannot tell you what the result of that conclusion will be? 15 16 A 17 328 Q Yes . However, let us assume for a working hypothesis at 18 the moment that we concluded that he was a Client 19 of "Ansbacher"? 20 A 21 329 Q Yes, yes. We then have to separately consider whether 22 Kennedy McGonagle Ballagh were Clients of 23 "Ansbacher"? 24 A 25 330 Q 26 A 27 331 Q 28 A 29 332 Q Yes . It is a separate consideration? Yes . And we are highly conscious of that? Yes . 1 2 333 Q 3 So, that is why we are particularly honing in on this (indicating), Exhibit 9? 4 A 5 334 Q 6 A 7 335 Q And we can come back to you on that. Yes ? I will come back to you on that. Yes. All right. That would be great. I wonder when you are coming back to us on that? 8 9 A 10 336 Q Yes . Would you do us the courtesy of when you are 11 writing to us in the letter would you put a note 12 at the bottom of the letter to say that, 13 can be included as part of my sworn testimony"? 14 A 15 337 Q 16 A 17 338 Q 18 "This Sure . Do you understand that? Yes, yes. That will enable us then not to have you to come back to swear it again? 19 A 20 339 Q 21 A 22 340 Q 23 Fine, okay. Do you understand? Certainly. I think that may will be in everyone's interest to do that? 24 A 25 341 Q Certainly, okay. I wonder could you do that reasonably quickly 26 because we are getting to the end of this phase 27 of our inquiries? 28 A 29 342 Q Yes . And we are obviously anxious to tidy it up fairly 44 1 2 3 Yes, yes. 343 Q I think there is only one other thing that I have 4 to say to you and it is this: 5 a telephone call with you on the 27th February and 6 that is grand? 7 A 8 344 Q 9 A 10 345 Q 11 A 12 346 Q That Ms. Cummins had Yes . It was only a housekeeping telephone call? Yes . There is no difficulty about it? Right. However, the last sentence is: 13 14 "He also told me that Liam McGonagle had arranged through Des Traynor for a job to be done for the partners and they were unaware of the extent of it until relatively recently." 15 16 17 18 19 What were you referring to in that? A I presume we are referring to the payment in 1993 of the fee. 20 21 347 Q 22 A 23 348 Q 24 A 25 Yes? I presume that was it. Yes. Could it have been anything else? I can't think of anything. have been anything else. 26 349 Q 27 A 28 350 Q 29 A All right? No. That is grand? No, it wouldn't 1 351 Q. 2 A. 3 352 Q. 4 A. 5 353 Q. 6 A. 7 354 Q. 9 A. 10 355 Q. 11 A. 12 That that was in fact the situation? Yes, that is my recollection of it. That is your recollection? But I mean you surprised me about that other payment Well... (INTERJECTION)? No, I have...(INTERJECTION). In 1984 or 1992? Which is more surprising to you? No the -- not that one (indicating). The other one in 1984 I think. 13 356 Q. 14 A. 15 357 Q. 16 A. 17 358 Q. 18 A. 19 1984? Isn't it the memo? Yes, I see? On the 5th September 1984, Exhibit 7. Yes? I am surprised at that. I have no recollection of that. 359 Q. 21 You have no recollection of that at all. I do understand how these things can happen? 22 A. 23 360 Q. 24 A. 25 361 Q. 26 Yes. Without you having a recollection of them? Yes. However, I wonder whatever about the 1984 one which is mildly suspicious? 27 A. 28 362 Q. 29 Yes, that is m y ...(INTERJECTION). in 1984. 8 20 I just wanted to check? Yes. The 1992 one is a positive connection? 1 363 Q 2 A 3 364 Q 4 A Yes, okay. 5 365 Q All right? 6 A 7 8 Sure . I mean that is the position? Well, we can hopefully get that explanation from you. 3 66 Q 9 10 Ms . Mackey? MS. MACKEY: No, no questions. JUDGE O'LEARY: Mr. O'Shea, thank you 11 very much indeed. 12 A 13 367 Q Thank you. That is actually everything we have to say to you 14 and thank you very much for all your cooperation 15 and we appreciate it greatly. 16 early replies. 17 you could do that? 18 A 19 368 Q We would appreciate It would facilitate us greatly if Yes, yes. Obviously part of the process is the signing of the transcript? 20 21 A 22 369 Q 23 A 24 370 Q Yes . Because it is included in the Legislation? Yes, yes. I mean obviously...(INTERJECTION). So, in due course Ms. Cummins will be in 25 touch with your firm and you can make the 26 necessary arrangements? 27 A 28 29 So, I mean I can come in to sign it whenever it is ready. 371 Q 1 2 And copies of the transcript can be got for a 3 payment of? 4 MS. CUMMINS: £60. 5 JUDGE O'LEARY: Of £60. 6 A Yes . 7 373 Q All right? 8 A Thank you. 9 374 Q 10 A Thank you very much indeed. Thank you. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED \i?wxp 725,7? ?rrgz?? muf?n; Th? Uf?wu?r I understand that I have been called to give evidence pursuant to the Inspectors’ powers set forth, inter alia, in Section 10(2) of the Companies Act, 1990. I am here today because of the exercise of the Inspectors' right to compel my attendance. I am not here voluntarily. I am not prepared to answer questions voluntarily. I understand the Inspectors have power to force me answer their questions, provided always the questions are within the scope of their investigation. All answers I give today are given as a result of the exercise of the Inspectors of their powers under Section 10 anu- >r such other statutory powers as they have to compel answers and not otherwise. I have ailfg-H the Inspectors not to exercise their power to compel my testimony. They have insisted I answer all questions under compulsion of law. K f v ennedy M cG o n a g l e B allagh Incorporating B ell B ranican O'Donnell & O ’B rien s o l i c i t o r s 20 NORTHUMBERLANDROAD DUBLIN 4 TEL660 9709 FAX660 9434 EMAIL: info@kmb.ie www.kmb.ie The Office of the Inspectors appointed b>A££5 Our ref: MO’S/DF High Court to Ansbacher (Cayman) Ltd. 3rdFloor • Trident House , .. . Blackrock 4 ? Co Dublin 16 March 2001 Re: Ansbacher (Cayman) Limited (“the Company”) Dear Inspectors, I have nad no J :'ungs personally with the Company. However I believe the Firm of K*nn«dy McGnnagle Ballagh in which T am a oartner have had the following dealings. * * 1 In November 1993 the firm was instructed by Cayman International Bank and Trust Company Limited to pursue a guarantor on foot of a guarantee given to Guinness & Mahon Cayman Trust Limited on behalf of a Cayman registered company called Coral Reef Securities Limited. Proceedings were instituted against the guarantor and were ultimately settled. Our fee of £3,210 and outlay was discharged by the Company. The Solicitor who handled this matter for the Company was Kevin Barry. 2 Also in 1993 a fee paid by a UJEC client of the Firm was lodged by the partner who acted for this client with the late J.D. Traynor and this fee was subsequently paid to the partners including me through Kentford Securities Limited. The partner who handled this matter was the late Liam D. McGonagle who was a personal friend of the late J.D. Traynor. The U.K. client was not a client o f the Company and did not avail of any of the services provided by the Company. I believe Mr. Traynor merely facilitated my late partner, Liam D. McGonagle and neither he nor the Company nor Kentford Securities were paid a fee for this service. —■ 3 In 1995 the Firm advised the Company in connection with a loan granted to Columbia Investments (an unlimited Irish registered company) and also in respect of a guarantee and pledge agreement by Columbia Investments Limited to the Company in respect of loans made by the Company to two Cayman Island registered companies. The Company discharged our fee of £6,750 and outlay for this work which was handled by Olivia McCann, a former assistant in the Firm. V K U IA I.I. I. O 'S IIC A RtKifcR P. B A lJ -ltH t IliKI.NCi: I;. DIXON KI.'VIN C. R U tH Y fiOKIfcl'. Jl IX J ASSISTANTS: CHINA IIKNRV A U U H A II. IAYI.CW 4. Also in 1995 the firm was instructed in relation to an application by the Company to the High Court for leave to extend the time for filing Form 47 with the Companies Office in respect of the security referred to at 3 above. The Company discharged our fee o f £400 plus outlay for this work which was again handled by Olivia McCann. 5. I have personally been involved in advising a number of clients who have had or have a relationship with the Company and this advice has been given in the context o f McCracken and Moriarty Tribunals and statements and attendances before you. • The Company * :ct provided no service to me personally and I have not established anv trust managed by the Company nor tn n w irnAwi»*/4rr*» «cn t the beneficiary of any trust managed by the Company. ' I have not deposited any money with the Company or with Guinness & Mahon (Ireland) Limited however Kennedy McGonagle Ballagh has from time to time used the services of Guinness & Mahon (Ireland) Limited. It has deposited the Finn’s money and clients' money with that Bank from time to time and during one or both of the Bank strikes it used banking facilities provided by that Bank. Guinness & Mahon has provided a normal commercial loan to the partners in the firm including me to fond the purchase o f No. 18 Northumberland Road. This loan was secured against the property purchased and our personal guarantees. It was not secured on any funds held by the Company. Apart from the service mentioned at 2 above, provided by Kentford Securities Limited, no service has been provided to me by any o f the other companies listed in your letter namely, Amiens Securities Limited, Amiens Investments Limited, and Irish Intercontinental Bank Limited. The only services provided by Guinness & Mahon (Ireland) Limited were those mentioned above in the preceding two paragraphs. No service has been provided to me by any of the companies mentioned in your letter and established in the Channel Islands. Yours faithfully, , t/f y J * ^ * , ^ /T!/ ( y /-'*•&«€ Could you please lodge the attached cheque for £8,250 Sterling to Sundry Persona end give me four Sterling drafts ms follows:Michael O ’Shea T. U x o n Redshank Investments . £1,050 £1,650 ■ £3,139 -! 250 ' f t 1 -* JDT/AJW C o l l e g e T r u s t e e s L im it e d MCA/ 2nd May, 1985 B. M. Greffier. Royal Court House, St. Peter Port, . Guernsey. • _ •. • • '* • * M "3*. 1 Dear Sir* RETV5IUNK INVESTMENTS LIMITED \ The registered office and the poet office box'number of the above companies' was changed on 15th April, 1983. Xbe regis­ tered office is now situated ate- . . Plateau Mignot, Rua das Cornets, St. Peter Port, , Guernsey. . Correspondence should now be addressed to P.O. Box 223. Yours faithfully, . .. for CO&USGE TRUSTEES LIMITED, . D. J, Barry Director P.O. Urns I 3J. St. ;ul!nn> Qmrr. Si. Julian1* A ra m Si. r« « r Port, flunmwy. ChaiMel blind*. r«:ephi.n«i dim m y MW I lW » s W l» : lU-sUrmdwii CuMiurv <47* T ' Please reply to: 42 Fkrwilliam Square, Dublin 2. P.O.Box 387,GrandCiymia.Csnaaa Itkmla.BririahW«t Tel: 765144/763065 Fax 612035 Tetephoca:(809)949-3&5J T ata: CP 4305 Facdmile (809) 949-7946 (809) 949*5367 18th. May, 1992. Ronan Xedmand, Esq., Corporate Services, Irish Intercontinental Bank Liaited, 91 Marrion Square, DUBLIN 2. . V . Dear Honan, - • . Could you please arrange to let ne have for collection an Xriah Pounds cheque for IRfil0,000 payable to Kennedy KeOonagle Ballagh and debit tha Starling cost to Ansbacher Limited Account No.02/01087/31. ’ • • 1 7oura sincerely, Tra®*- I— ? o r ANSBACHER EJMTKBD ( S> '■•V& 1 j d t /a j w Aieamaori^AMssjuriuaignPKtTOia^TagwiawgiyeowAWWwrnionTCM c u a t o x r . w o t u o o am> f f M n a u H o Limited Hum]. II If E?izuj mm .zn/ U/uz I um K. vh mm? CARRIED FORWARD A N SB A C H E R LIMIT. t> P.O. Box 887 Grand Caym an British W est Indies T elep h on e No. 9 — 4653/4 T elex CP 305 C able A d d ress G u in n ess A/A54 ACCOUNT NUMBER 80001642 PAGE BALANCES SHOWN ARE IN: sterl ing ' ..‘ 0.00 37:549.59 37549.59 _________ / ) ^ A n u ;ro N koss J C *i:MII: IfV.A*.III! !I .?>!!''< .M'» ..' )I** .' .I r i ■ /IV 1/' .1!•* 'II 11 1 i'I:< i/•) \ BROUGHT FORWARD I I DRAWN \ / ! V \ / < r A I ! / ( ) ' ' / 'r>. DRAWN DRAWN I M / O ' 1/':.'! DKAWN 13/ 09/93 13/ 09/93 ;i 0 / i» 9/93 IJ.t'il*,7 7 .tV 7 1^ 000.00 T ii! f > r p s t to 30/ 09/93 A N SB A C H E R L IM IT .Jb P.O. 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U 'q & n a g a . fia flC o jt n Nocmo • CwidmntiBfiCal /? Pw Om^w dfMmna* • •/■ DEPOSIT DIALING TICKET TtoaauryCcpi______________ ,_______________ s f y 1 O-Hr jfrIX. VrJ L Z ~ m m a £ l «* » H o & 'y o a o » *>%M ContactNo. U L 134839 S AUTHomtxnoN a h b q u m c o Noeroow— w p o s t t VWtborrow*•wooocoptoo OapoaH Cunonay g ay h ,lQ I *. 9 2 . WadatXtynurAJC ^NOSTSCOUT--' ’ -4*' ' W*pt*eo-woi«ttf- -oropay \ L "" v; W» cud* yourAte J SPfiCIALNSTRUCmONS w s s E s m InnrtftAtt n n 22l AdovorOflftt mnwrt Amount Braicar I IUmt PIWPBi BL OUTTO-C«onr»tnilnjtfion» (Itroqulrodondnct AtMaturityOUT TO Cflonft Maturity knotrucOono dktquSL taWMMUl IP O &<£ol>J3U\JC 4rVO4ot*VLfc0fr-> '/J 'c l M A SO N HAYES & C U R R A N SOLICITORS Office of the Inspectors appointed by the High Court to Ansbacher (Cayman) Limited, 3 rd Floor, Trident House, Blackrock, Co. Dublin. t ->i 14 December 2001 M atter : Y o u r Re f : it v r ' V ik. O u r R e f : D M /P C Ansbacher Dear Sirs, W e act for M r. Terence Dixon, a partner in Kennedy McGonagle Ballagh, Solicitors, 20 Northumberland Road, Dublin 4 who has requested us to write to you in response to your letter to him dated 23 November 2001. Having considered the “Inspectors Preliminary Conclusions” we are at a loss as to how the information (such as it is) or the reasoning (or lack of it) justifies the “Preliminary Conclusions” reached. . What is clear is that Kennedy McGonagle Ballagh was due a fee and it was paid. The partner to whom it was paid gave M r. Desmond Traynor the money and in due course caused it to be returned to the partner in a manner that divided it between himself and other partners. It is said the monies, part of which were received by M r. Dixon, came from Hamilton Ross or an entity unknown to our client (a matter you assert but do not sustain by any evidence disclosed). This does not prove your conclusions even if true (a matter not conceded or accepted). In short your “Preliminary Conclusions” that M r. Dixon was a client of Ansbacher are ill founded. This finding has been arrived at by you, without any evidence having been heard or taken from our client which quite clearly is in breach of his constitutional rights and fair procedure. No proof whatsoever has been produced to show that M r. Dixon was a client of Ansbacher. He is not, and never was, a client of Ansbacher and indeed had no knowledge of that Bank, nor the other companies mentioned. Even allowing for your apparent broad interpretation of 6 FitzwilliamSquare, Dublin 2, Ireland, DX11 Dublin, Tel +353 1614 5000, Fax +353 1614 5001, www.mhc.ie, E-mail mail@mhc.ie MauriceR. Curran, MaeveHayes, AnthonyBurke, DeclanMoylnn, LorcanBuckley, Emer Gilvarry, Paul J. G. Egan, ColmanP.Curran, NoraLarkin, DeclanCurran, RichardA. Woulfe, KevinHoy, DeclanBlack, LiamBrazil, AilbheGilvarry, JohnKettle, DavidO'Donnell, Niall Michel, JohnKehoe, Peter Mclnnes■ i - i a w an allia nce w ith SeniorAssociates NianihClarke, MatthewWales, MajellaDolan, GillianMcNamara, ShaneMacSweeney, SusanRyan Carson McDowell Consultants A. Dermot Mason, Conal J. Clancy, RoryI.. Egan in Belfast l m “client”, this word quite clearly has a specific meaning as defined in all the standard dictionaries and under none of these definitions can M r. Dixon be held to be a “client”. Therefore we require your confirmation by return that no such conclusion w ill appear in your Report. Yours faithfully, r M A S O N H A YE S & C U R R A N M A SO N HAYES & C U R R A N S O L I C I T O R S Office of the Inspectors appointed by the High Court to Ansbacher (Cayman) Limited, 3rd Floor, Trident House, Blackrock, Co. Dublin. 15 January 2002 M a tter : Y our R e f- . ? O u r R e f : D M /P C An sb acher Dear Sirs, We write on behalf o f M r. Terence Dixon. Thank you for your letter of 21 December 2001 in response to ours of 14 December 2001. Your refusal to amend any part of your preliminary' conclusion is entirely unacceptable to our client who is outraged by it. ' Our client understands the pressures upon you to produce a final report. However, we must, with respect, suggest that the treatment afforded our client is grossly unfair and does not vindicate his rights in any respect. Our client has never been called to give evidence before you and so far as we are aware the sole communication he has been involved in with you is his letter of the 16th March 2001 written in response to a request by you. The relevant portion of that letter is to be seen in paragraph number 2 in which the following is said:“ Also in 1993 a fee paid by a U.K. client of the Firm w a s lodged by the partner w h o acted for this client with the late J.D. Traynor a n d this fee w a s subsequently paid to the partners including m e through Kentford Securities Limited. The partner w h o handled this matter w a s the late L i a m D. M c G o n a g l e w h o w a s a personal friend of the late J.D. Traynor. The U.K. client w a s not a client of the C o m p a n y a n d did not avail of any of the services provided by the Company. I believe Mr. Traynor merely facilitated m y late partner L i a m D. M c G o n a g l e a n d neither he nor the C o m p a n y nor Kentford Securities Limited were paid a fee for this service”. 6 FitzwilliamSquare, Dublin 2, Ireland, DX11 Dublin, Tel +353 1614 5000, Fax +353 1614 5001, www.mhc.ie, E-mail mail@mhc.ie MauriceR. Curran, MaeveHayes, AnthonyBurke, DeclanMoylan, LorcanBuckley, Emer Ciilvarry, Paul J. G. Egan, ColmanP.Curran, NoraLarkin, DeclanCurran, RichardA. Woulfe, KevinHoy, DeclanBlack, LiamBrazil, AilbheGilvarry, JohnKettle, DavidO’Donnell, Miall Michel, JohnKehoe, PeterMcfnnes i-law an allia nce w ith SeniorAssociates NiamhClarke, MatthewWales, MajellaDolan, GillianMcNamara, ShaneMacSwceney, SusanRyan Carson McDowell in Belfast Consultants A. Dermot Mason, Conal J. Clancy, RoryL. Egan Your preliminary conclusion is premised upon a narrative that states as follows:- “ Mr. Michael O ’ Shea, Mr. R o g e r P. Ballagh a n d Mr. Terence D. E. Dixon are Solicitors in the firm of Kennedy M c G o n a g l e Ballagh, 2 0 Northumberland Road, Dublin 4. Their involvement in Ansbacher arose out of their late partner’ s (Mr. L i a m M c G o n a g l e ) long-term involvement in offshore banking. During 1992, fees earned by the firm were deposited, at the suggestion of Mr. McGonagle, with Mr. D e s m o n d Traynor a n d ended up in an Ansbacher account. The s u m involved w a s £40,000 approximately. The m o n e y w a s left on deposit offshore for s o m e time a n d then shared out a m o n g the partners. The payments were m a d e f r o m a Hamilton Ross account in Ansbacher. The IIB dealing tickets s h o w that Mr. Ballagh received over IR£11,530.00, Mr. O ’ Shea a n d Mr. Dixon received IR£6,243.00 each a n d the firm received IR£4,877.00 a n d a c o m p a n y controlled by the late Mr. L i a m M c G o n a g l e stg£6,701.00. All the partners w h o shared in that fund were thus clients of Ansbacher. The Inspectors’ formal decision on the late Mr. M c G o n a g l e is to be f o u n d elsewhere in the report”. It is said that the preliminary conclusion, which you stand by, is: “ Mr. Michael J. O ’ Shea, Mr. Roger Ballagh a n d Mr. Terence Dixon were clients of Ansbacher”. The evidence supporting your conclusions is said to be a statement by M r. Michael O ’Shea, evidence given by Michael O ’Shea, the exhibits produced at that hearing (by you) and the seven further exhibits set out. Your “ Preliminary Conclusions" Some Preliminary Points We can find nowhere in the transcript of M r. O ’Shea any suggestion that he was asked to represent or indicated that he represented our client M r. Dixon. On page 10 of the transcript we find, however, that Inspector O ’Leary stated: “W e must identify the client of the c o m p a n y w e are investigating... Ansba c h e r ”. W e note in the “ foreign exchange dealing ticket (document 5)” appended to your preliminary conclusion, it is expressly stated that the customer is “ Hamilton R o s s ”. What M r. Dixon has said, which is uncontradicted by any evidence that we have seen, is that the fee paid in 1993, by a client of Kennedy McGonagle Ballagh, was subsequently divided among the partners including M r. Dixon. He made it clear that the matter was handled by Liam D. McGonagle. He made the point, from information he received after the event, for the purpose of attempting to respond to your queries, that the fee was received in the manner detailed. In the circumstances, we might respectfully suggest that a fair analysis of this transaction, if it is one that has any part to play in your report, would be as follows: “ In 1993 Mr. Terence Dixon, in his capacity as a partner in his Solicitors' practice, received part of a fee earned by one of his fellow partners Mr. L i a m McGonagle. Mr. M c G o n a g l e took responsibility for recovering the fee f r o m the partnership’ s client a n d making the arrangements for its distribution a m o n g his fellow partners. It n o w transpires that the pay m e n t to Mr. Terence Dixon w a s effected through a c o m p a n y called Kentford Securities Limited. It n o w appears that the pay m e n t in question w a s effected by Hamilton Ross drawing on a bank account maintained with another bank (possibly Ansbacher (C a y m a n ) Limited). Mr. Terence Dixon w a s not party to the arrangements that Mr. M c G o n a g l e put in place. Whilst it is clear that Mr. Terence Dixon received a p a y m e n t through Kentford Securities Limited w e have not been able to establish whether he w a s a client of Ansbacher". W e do not believe that there can be any objection to presenting your conclusion in that manner. W e say this, subject always to you explaining the matters we refer to above. We have to say that we are gravely concerned by your refusal to engage in any meaningful dialogue in relation to your preliminary conclusions. As a matter of common sense, it is not fair. As a matter of law, it is also a denial of our client’s right to fair procedures. The fact that you have written to our client clearly establishes that:(a) your conclusion constitutes “a finding or inference adverse to Mr. D i x o n ’ s interests, g o o d n a m e and/or reputation”; (b) M r .Dixon has the right to be: (i) (ii) (iii) (iv) (v) informed in writing o f the proposed finding or inference informed of the evidence which is thought to justify the proposed finding or inference afforded the opportunity to prepare a written reply to the proposed finding or inference afforded, by way of further examination on oath, an opportunity to introduce rebutting evidence and/or to address the Inspectors afforded an opportunity to cross-examine the relevant witnesses. I !l In circumstances where you have simply failed to engage on the case made by M r. Dixon concerning the suggestion he should be described as a “client of Ansbacher" it is incumbent on us, for the purposes of protecting his interest, good name and reputation, to take this matter further. Please note that we require the following:1. The opportunity of producing evidence that in relation to the distribution of the fee, M r. Dixon had no knowledge of the arrangements being put in place by M r. McGonagle and absolutely no knowledge that the monies that he received had, at any time (if that be the case, a matter we do not accept that you have evidence of) been retained in an Ansbacher account. 2. W e also require that we be entitled to address you. Clearly, the procedures you yourself have adopted provide for the right to have an interplay of views between yourselves and persons such as M r. Dixon for the purposes of permitting him to appropriately vindicate his interest, good name and reputation. In the event that we cannot make some headway in dealing with your preliminary conclusion, either by following our procedural rights as identified above, or through some other means, our client wishes the opportunity to cross-examine such witnesses as you have who can give relevant evidence that the monies in question were ever in an Ansbacher account. Perhaps you could identify these witnesses and indicate when they w ill be made available for cross­ examination and deliver a transcript of the evidence they have given. W e note in your procedures that where issues arise between any person and your good selves, a procedure of seeking directions from the High Court to resolve issues is referred to. Should we fail to reach an accommodation in relation to the provisions of your report to which we refer, we reserve our right to be the subject matter of such application You w ill be able to appreciate the impossible position M r. Dixon finds himself in. He is a solicitor and an Officer of the High Court. He has received a share in a fee due to a legal practice of which he was a partner. In circumstances of which he knows nothing it is alleged that part of this money may have been held in an account operated by Ansbacher. W e have to say, with the greatest respect, that to see him designated as “a client of Ansbacher ” with the damage to his interests, good name and reputation that such a designation w ill bring, is unfair, unjustified, unnecessary and irrational. In relation to the monies paid to M r. Dixon, he objects to being dealt with in a section of your report that also deals with other persons. Finally, it seems to us a brief meeting between the representatives of yourselves (or better still yourselves) and this office could go a very long way to defusing what on the face of it, appears to be a confrontation that is entirely unnecessary. M r. Dixon has no problem accepting that he received the payment in question. His objection is to being called a client of Ansbacher, an institution the services of which he never knowingly utilised, or wished to utilise personally or for any client. m We assume that pending your response to this letter, no report w ill be published containing the sections concerning M r. Dixon. I f this is not the case please tell us and we w ill take the necessary steps elsewhere. Yours faithfully, M A S O N H A YE S & C U R R A N Appendix XV (29) Mr David Doyle 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r David Doyle. a) Transcript o f evidence of M r David Doyle dated 16 June 2000. b) Statement of M r David Doyle dated 7 June 2000. c) Extract from computer printout of an unheaded a/c furnished by David Doyle. d) Sample o f unheaded statement furnished by David Doyle. e) Sample of unheaded statement of a/c. f) Computer generated a/c statement dated 13 July 1999. g) Letter of 5 May 2000 from Corrigan &Corrigan to David Doyle. h) Letter of 2 May 2000 from David Doyle to M r William Corrigan. MR. DAVID DOYLE UNDER OATH ON FRIDAY, 16TH JUNE 2000 I hereby ce rtify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer THE INSPECTORS: MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY B.L. SOLICITOR TO THE INSPECTORS: MS. M. CUMMINS INTERVIEWEE: MR. DAVID DOYLE REPRESENTED BY: MR. RORY McCABE S.C. MR. PAT KENNEDY MS. OONAGH MEADE INSTRUCTED BY: KELLY KENNEDY & CO. 22 UPPER MOUNT STREET DUBLIN 2. 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Doyle, we w i ll begin our interview. I w ill 6 introduce myself. 7 right is Ms. Mackey and on my le ft is Mr. Rowan. 8 are the Inspectors, as you know, who have been 9 appointed by the High Court. I am Declan Costello and on my We I should explain to 10 you, Mr. Doyle, that this is not a Court hearing, i t 11 is not a Tribunal hearing, i t is an interview. 12 in the course of this interview we ask you questions 13 on which you would like to get advice from your 14 legal advisors, please t e l l us so and we w ill stop 15 asking questions and you can then take advice. 16 Similarly, at any time your legal advisors can ask 17 us to stop asking questions i f they wish to advise 18 you in relation to any question we ask you. If 19 20 Mr. Doyle, your evidence w ill be taken under oath 21 and I w ill ask our s o lic ito r now, Ms. Cummins, to 22 administer the oath to you. 23 24 25 26 27 28 29 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Doyle, have you got a copy of the statement 6 there that you gave us (Exhibit 1)? 7 A. 8 2 Q. 9 I do. You begin by t e llin g us that you reached a settlement with the Revenue on 17th December 1993. 10 Was that under the provisions of the Tax Amnesty 11 Act? 12 A. 13 I actually don't know. I t was handled by Terry Cooney. 14 3 Q. 15 A. Mr. Cooney, the accountant? Yes. My understanding is i t was done in a similar 16 time, I'm not too sure. 17 wording, but my understanding is that i f i t wasn't 18 the Amnesty, i t was a complete tax settlement. 19 4 Q. I haven't actually seen the I w i l l have to come back to i t in a few moments, 20 Mr. Doyle, but the position is i t was Mr. Terry 21 Cooney who handled it? 22 A. 23 5 Q. 24 A. 25 6 Q. Yes. He is an accountant? He is a tax consultant, I think. Was Mr. Cooney your personal tax advisor on your own 26 personal tax or did you get his assistance for this 27 particular purpose? 28 A. 29 7 Q. No, he was advisor to the Group. Advisor to the Group? 1 2 8 Q. 3 A. 4 9 Q. 5 Was he your personal tax advisor? As such, yes. Did you have any other accountant advising you on tax matters? 6 A. 7 10 Q. 8 A. 9 11 Q. Bastow Charleton were doing my tax returns. Doing your tax returns? Yes. Could we turn over the page (Exhibit 1) and you say 10 you cannot recollect having executed a deed of 11 trust. 12 you executed a deed of trust or do you think i t is 13 very unlikely? 14 A. Do you think is i t possible, Mr. Doyle, that In my experience recently having seen a trust 15 document I would believe I didn't execute a trust 16 because I believed I had a bank account. 17 remember ever seeing a document to be handed and 18 said, 19 12 Q. I don't 'read this and go through the document.' Did you enter into this arrangement with Mr. Traynor? 20 21 A. 22 13 Q. Yes. Would you t e l l us approximately when the arrangement 23 was entered into, where i t was entered into and the 24 conversation that took place between you and 25 Mr. Traynor? 26 A. I n i t i a l l y I suppose my introduction to Guinness 27 Mahon was through - - Des Traynor who was a family 28 friend and I understand in 1980, there is a paper 29 here, an account was opened for a week with him in 1 relation to a dispersement to the family members. 2 14 Q 3 A Sorry, I am not following you. Sorry, I think in 1980 there is an authorisation 4 here to open an account. 5 introduction to the bank, to Guinness & Mahon from 6 my point of view. 7 to do with this except maybe to sign the i n i t i a l 8 form, so i t was just a disbursement to family 9 members. 10 15 Q 11 12 That was the f i r s t I actually didn't have anything What do you mean by "a disbursement to family members ?" A There was money lodged, there were accounts opened 13 for family members and there was money given to them 14 by my late father. 15 16 Q 16 A 17 17 Q 18 19 Money given by your father? Yes . That was the f i r s t time you had an account with Guinness & Mahon, is it? A Yes. I suppose this was given to me by Mr. McCarthy 20 recently, so I haven't referred to this in the past 21 because I actually didn't know i t was there. 22 was done on my behalf without my involvement. 23 18 Q This I would like you to come to deal with your 24 conversation with Mr. Traynor about the transfer by 25 you to him of funds and what he said he was going to 26 do with them. 27 Sorry, just to recount the relationship, Des was a 28 family friend and had a lot of dealings with my 29 father. I met him a lot of the time, probably on a 1 daily i f not weekly basis. 2 f i r s t involvement I had with him was to do with 3 share dealings. 4 believe that the f i r s t account I opened was with the 5 proceeds of those share dealings. 6 this, my understanding was that this f i r s t account 7 was just a disbursement to the family members. 8 was opened and i t was closed again and that was the 9 end of i t in the year 1980. From my recollection the I am putting the pieces together I Sorry, outside of It Subsequently in 1983 I 10 think i t was with whatever share dealings I had, I 11 le ft the proceeds with Des Traynor. 12 19 Q. Just refer to page 2 of your statement (Exhibit 1) 13 and do you see you used the deposit maintained with 14 the company, the deposit made with the company. 15 say at the end of the page: 16 You "At some time I made a p ro fit from dealings. This account was opened in Guinness & Mahon by Mr. Traynor in which proceeds were deposited." 17 18 19 I want you to t e l l me the conversation you had with 20 Mr. Traynor about the transfer by you to him of your 21 funds. 22 A. I think he was handling the share purchase and the 23 share sale, I think that is how he ended up with the 24 i n i t i a l funds. 25 20 Q. I know he had an involvement. No, Mr. Doyle, what we want to find out is how i t 26 came about that he took those monies and put them on 27 deposit in a coded account on your behalf. 28 you t e l l us how that came about? 29 Would 1 21 Q. 2 A. 3 22 Q. 4 A. 5 23 Q. 6 A. Just the gist of i t and when i t took place. I am presuming in 1983. Why are you presuming that? Because that was the time of the share dealings. Yes. My understanding was there were two accounts or an 7 account he opened in my name and my understanding 8 was that i t was in Guinness & Mahon London. 9 24 Q. Listen to the question. I am asking you not what 10 your understanding was now, I am asking you about 11 the conversation you had with Mr. Traynor as far as 12 you can recollect i t and where i t took place. 13 A. I can't actually recollect the conversation about i t 14 other than i t could have been in his office, but I 15 don't think so. 16 25 Q. 17 A. 18 26 Q. 19 A. 20 27 Q. 21 A. 22 28 Q. 23 A. You do not think so? I think I was in his office once. You do not think this was in his office? No. Would i t have been in your hotel? I think i t was probably in one of the hotels. What happened? What did he say? I w i l l be honest with you, I can't actually 24 recollect the conversation other than Des was the 25 type of person who just said, 26 after th a t.' 27 29 Q. 28 A. 29 30 Q. 'rig h t, I ' l l look T e ll me what he said to you, look after what? Well, he had the money. What money? 1 Sorry, I am presuming the i n i t i a l funds that went 2 into the account or there was the money from 3 Atlantic Resources. 4 31 Q 5 A 6 Why are you presuming that? Because I had no other reason to deal with him before that. 7 32 Q 8 A 9 33 Q 10 A 11 34 Q 12 A 13 35 Q 14 A So i t was, you think i t was? Yes . This was Atlantic Resources? Yes . So you made a p ro fit from Atlantic Resources? Yes . T e ll me what he said to you about it? I have no recollection. I can say that he said 15 certain things but i t wouldn't be true to my 16 recollection. 17 36 Q 18 A The relationship I had with Des was . . . . (INTERJECTION). 19 20 I do not want you to t e l l me anything that is false. 37 Q No, you need not go into that, I just want you to 21 t e l l me what happened. 22 proceeds of sale or the p ro fit you made from the 23 sale of shares? 24 A What happened to the My understanding is that they went into 25 . . . . (INTERJECTION). 26 I do not want your understanding, I want you to t e l l 27 me the conversation you had with Mr. Traynor i f you 28 can remember it? 29 I can't remember i t . 1 39 Q. 2 A. 3 40 Q. 4 5 You cannot remember any conversation? No. So you do not know what happened, you cannot t e l l me what happened? A. I can't, but I can piece together over a period of 6 probably a year or two that the money either stayed 7 with him in that account or at some stage there was 8 a suggestion that i t would be kept in an account, to 9 my understanding, in London. 10 41 Q. 11 12 mean by that? A. 42 Q. A. 17 18 How did you come to understand that Guinness & Mahon in London had anything to do with your account? 15 16 My understanding was that Guinness & Mahon London was ....(INTERJECTION). 13 14 How do you mean your "understanding," what do you Because Guinness & Mahon London was the parent . . . . (INTERJECTION). 43 Q. 19 How did you know that that had anything to do with the money that Mr. Traynor had in your account? 20 A. 21 44 Q. 22 A. 23 45 Q. 24 A. 25 46 Q. 26 A. I t may have been suggested to me. I t may have been? Yes. But i t may not have been? I t may not have been. You do not know? I can't honestly say. Judge Costello, I can 27 attribute things to Des Traynor because he is not 28 here to defend himself obviously, but i f I don't 29 know I w ill t e l l you I don't know. 1 47 Q. 2 I would much prefer, Mr. Doyle, i f you told me the truth. 3 A. 4 48 Q. 5 A. 6 49 Q. That is exactly what I am trying to do. I want you to t e l l me the truth. Yes. As I understand your evidence now i t is that you 7 have no recollection. 8 the Inspectors that you have no recollection of what 9 Mr. Traynor did with the money that you say you made 10 11 You are t e llin g me, te llin g on Atlantic Resources? A. Sorry, what I am saying is, you have asked me about 12 the conversation with him, I can't recollect the 13 conversation I had with him other than what the 14 d r i f t would have been. 15 50 Q. 16 A. 17 51 Q. 18 A. 19 52 Q. 20 A. 21 53 Q. 22 23 24 25 Do you know what he did with it? He set up an account in Guinness & Mahon for me. How do you know that? Because I used to get statements to my home. To your home? Yes. Would you look at the second paragraph of page 2 of your statement (Exhibit 1): "Principally for security and privacy reasons we opened an account with a small bank. At that time Guinness & Mahon's operations in Dublin consisted of services to high net worth individuals." 26 27 Is that anything to do with us today, that statement 28 in paragraph 2? 29 1 various funds and putting them into one account was 2 to have some privacy. 3 54 Q 4 You told us that an account was opened in 1980, you have discovered, in your name? 5 A 6 55 Q Yes . You have told us you did not know about i t but your 7 father put i t in. 8 was dealing with the sale of shares that you made a 9 p ro fit from. 10 11 You then told us that Mr. Traynor How did you decide to open an account in a small bank, when did you decide that? A I had regular dealings with Des Traynor and he was 12 always in company. 13 was done on behalf of the family members and myself. 14 I understand i t was opened within the space of a 15 week and I am told that was that, that account was 16 finished and the money was disbursed to the various 17 members. 18 McCann Morrison and some shares I bought in 19 Atlantic, I made profits from that and that was the 20 start, i f you want to call i t , of the account. 21 56 Q 22 A 23 57 Q 24 A 25 58 Q 26 A 27 59 Q 28 A 29 60 Q The f i r s t account was one that Then through Des I had dealings with So you opened an account with Mr. Traynor? Yes . When was that, do you know? This was in 1983. You bought and sold shares? Yes . And you made a profit? Yes . Have you got, Mr. Doyle, a copy of our le tte r to you 12 1 of 13th A p ril there on your file? 2 HANDED). 3 Yes . 4 61 Q 5 (Exhibit 2) (SAME Do you see, Mr. Doyle, in the f i r s t paragraph we refer to the Order of the Court? 6 A 7 62 Q 8 Yes . We state in the le tte r: "The Inspectors were appointed to enquire into the affairs of Ansbacher (Cayman) Limited, formerly known as Guinness Mahon Cayman Trust Limited, Ansbacher Limited and Cayman International Bank and Trust Company Limited ('The Company')." 9 10 11 12 13 Throughout this le tte r we refer to Ansbacher as "The 14 Company". 15 A 16 63 Q Yes . Then we ask you then in the appendices in Appendix C 17 to give us information about the different services 18 the company had offered and whether you availed of 19 them. 20 the second page in paragraph B: 21 Then i f I may return back to your le tte r on "My dealings with The Company commenced in or around 1983 to the best of my re collection." 22 23 24 A 25 64 Q That statement clearly means that i t was your dealings with Ansbacher? 26 27 A 28 65 Q 29 Yes . With Guinness & Mahon? No, that is what I want to find out from you. this a mistake on your part? Is 1 In my statement (Exhibit 1) what I was referring to 2 was - - my understanding is that Guinness & Mahon 3 became Ansbacher and I am saying that 4 . . . . (INTERJECTION). 5 66 Q Mr. Doyle, would I be correct in assuming that you 6 got professional assistance in drafting this 7 statement ? 8 A 9 67 Q Yes . This statement is a statement saying that your 10 dealings with The Company, which is referred to in 11 our le tte r as Ansbacher, commenced. 12 now that you had dealings with Ansbacher? 13 A Do you accept (Pause). 14 MR. McCABE: I f I may for one moment? 15 MR. JUSTICE COSTELLO: Yes, certainly. 16 A 17 I t has been explained to me that i t is a typo error in relation to my statement (Exhibit 1). 18 68 Q 19 A Sorry? I t has been explained to me that i t was a typo error 20 in relation to my statement. 21 that my understanding is that Guinness & Mahon later 22 on became Ansbacher and that I was dealing with Des 23 Traynor on two accounts; one for a ll intents and 24 purposes what I understood to be on-shore and one 25 off-shore. 26 69 Q 27 A 28 29 What I have said was Yes, I see. But always with Des at Guinness & Mahon. My understanding is i t later on became Ansbacher. 1 and accepted a ll along that I am referring to 2 Guinness & Mahon. 3 70 Q. I just want to get clear now what you are te llin g 4 us. 5 am not tying you to that in any way, but I just want 6 to get i t clear. 7 you understood that you had two accounts; one was an 8 ordinary domestic account in Guinness & Mahon and 9 they sent you regular statements and you put money 10 You now have indicated to us that in and you took i t out in the ordinary way? 11 A. 12 71 Q. 13 Yes. The second was what we perhaps could ca ll an extraordinary account, an offshore account? 14 A. 15 72 Q. 16 17 I f there is a typographical error, of course I Yes, I believe so. Am I correct in saying that you did not know where that offshore account was kept? A. 18 I n i t i a l l y , yes. My belief was that i t was at Guinness & Mahon London. 19 73 Q. 20 A. 21 74 Q. 22 A. 23 75 Q. 24 A. In London? Yes. You thought i t was in London? I t was controlled from there, yes. What happened later? Then I believe at some stage Des may have either 25 indicated where i t was or he may have just said that 26 i t was held off-shore in the Cayman Islands. 27 76 Q. 28 A. 29 77 Q. In the Cayman Islands? Yes. So Mr. Traynor would have told you this at some 1 2 3 78 Q. I f I might just ask you to recollect perhaps a 4 l i t t l e b it better. 5 opened this account, this extraordinary off-shore 6 account in 1983. 7 A. 8 79 Q. 9 Mr. Traynor died in 1994 and you Yes. Do you remember in that span of years, the span of ten years or so, was i t early in that span that you 10 learned that your funds were in the Cayman Islands 11 and not in London? 12 A. I think i t would have been after that, probably in 13 the mid - - i f you had asked me without putting dates 14 in front of me, I would have said i t was maybe 15 1986/87. 16 80 Q. 17 A. 18 81 Q. Around about that time? Yes. Did Mr. Traynor t e l l you that you could use the 19 funds that were off-shore by approaching him and he 20 would make them available to you? 21 A. Yes, any deposits actually made were, I believe, 22 through him. 23 Williams cheques, but . . . . (INTERJECTION). 24 82 Q. I may have at some stage given Joan I am not talking about deposits, I am talking about 25 withdrawals. 26 withdrawals at any time by approaching him? 27 A. 28 83 Q. 29 Did he t e l l you that you could obtain Yes. So your understanding then was that you had deposited money, you thought, o rig in a lly in London 1 and then i t went to the Cayman Islands in the mid 2 1980's or so you were told this, but that you could 3 withdraw funds at any time? 4 Yes . 5 84 Q In fact you discussed with Mr. Traynor from time to 6 time the currency in which the money would be 7 deposited, did you? 8 A 9 10 Yes, or my recollection is that he may have rung me with a suggestion and say . . . . (INTERJECTION). 85 Q 11 Move them, because they were moved into a dollar account; were they not? 12 A 13 86 Q 14 Yes, I believe so. Did this happen more than once or did i t happen regularly? 15 A 16 87 Q The conversion? No, that he would ring you or that you would ring 17 him and suggest a change in how the money was 18 redeposited? 19 A Because I was running into him so much i t might come 20 up in conversation with him or i t mightn't. 21 on many occasions prior to his death, so I can't say 22 going back how many years, we spoke about Seven Mile 23 Beach on Cayman Islands and he would be saying he 24 had been . . . . (INTERJECTION). 25 88 Q 26 27 I am talking about where the money would be. A 28 29 No, I am not talking about that, Mr. Doyle. I know Sorry, I wouldn't ring him up spe cifically to discuss that. 89 Q No, what I am trying to find out is did i t occur 17 1 f a i r ly regularly that you would change the deposits? 2 A. 3 90 Q. 4 A. 5 91 Q. 6 A. 7 92 Q. No. But from time to time? I think i f I remember once. Once? I presume that. He rang you up, you think, or i t does not matter 8 whether you rang him but i t is probably lik e ly that 9 he rang you. Would you consider yourself 10 sufficie ntly au fa it with the money markets to ring 11 him and suggest changing the deposit? 12 A. 13 93 Q. 14 A. No. So i t is probably lik e ly that he rang you? Yes, or I am not saying there was a phone ca ll, but 15 I am saying that on a daily basis 16 . . . . (INTERJECTION). 17 94 Q. 18 A l l right, i t might not have been a phone ca ll, i t might have been a meeting in the hotel? 19 A. 20 95 Q. 21 A. 22 96 Q. Yes. You think this happened once? Yes. Mr. Doyle, you were obtaining statements on a f a ir ly 23 regular basis of how your deposits were going, is 24 that right? 25 A. 26 97 Q. 27 Yes. These statements would indicate the interest that was being earned on the deposits? 28 A. 29 98 Q. Yes. Am I correct in saying, Mr. Doyle, that you did not 1 pay tax on the interest that these deposits earned? 2 I believe so. 3 returned by the auditors and one which obviously no. 4 My understanding is the tax wasn't paid on the 5 in te re s t. 6 99 Q I had two accounts; one which was Do you know whether or not this was part of the 7 settlement that was effected on your behalf by 8 Mr. O'Donnell in 1993? 9 A 10 100 Q 11 I t was. In respect of the non-paid tax on the interest that accrued? 12 A 13 101 Q I t was. Just so that we can understand the position, you got 14 the statements regularly from Mr. Traynor, they 15 would come by the post, is that rig h t, or would he 16 give them to you by hand sometimes? 17 A 18 102 Q 19 20 No, I think they always came by post. Do you remember had they got the name Guinness & Mahon on the statements or was i t cut off? A Again I gave the Tribunal originals I had and I 21 don't know who has them at this stage, but the 22 photocopies - - liv in g down in Spain most of the 23 information I have got . . . . (INTERJECTION). 24 103 Q 25 A I am sorry? Living down in Spain most of the information I have 26 received have been photocopies of originals and 27 photocopies of faxes. 28 invoice as I remembered receiving i t from Guinness & 29 Mahon in its original form which I believe was I supplied to the Tribunal an 1 Guinness & Mahon's statement or a l i s t of credits 2 and a covering le tte r with an address of 17 College 3 Green. 4 What I am asking you about, Mr. Doyle, is the 5 statements that were sent to you on a regular basis 6 from Guinness & Mahon about your deposit, I am not 7 asking you about the money that was deposited. 8 A 9 105 Q 10 A No, I actually think there is a copy of one in here. Sorry? I think there is a copy here but i t does not reflect 11 the statement as I am trying to describe i t . 12 is a black and white photocopy and I think i t was on 13 cream paper and the statement was transparent. 14 106 Q 15 A 16 17 This You have got a statement? Sorry, I actually think I have a copy here somewhere. 107 Q Mr. Doyle, I am not talking about the ordinary 18 statements that you got on your ordinary Dublin 19 account. 20 A No, what I got as far as I know was a cream piece of 21 note paper with 17 College Green, a transparent 22 statement I believe from Guinness & Mahon and a slip 23 of paper that was a tear off of a computer print-out 24 (Exhibit 3). 25 108 Q 26 A 27 28 29 Are we looking at the same document? I t is a photocopy of the tear out off the computer p r in t-o u t . 109 Q Balance brought forward 10th November 1983 of £15,900; is that it? 1 2 110 Q 3 4 That is a photostat of a document and that had no heading, had it? A No, as far as I remember there were three pieces of 5 paper which came in; one was a covering le tte r, I 6 provided one to the Tribunal and as far as I 7 remember that was exactly as I got i t . 8 grease-proof piece of Guinness & Mahon bank 9 statement, i f you want to call i t that. 10 111 Q 11 A I t was a What is this document? This was a statement to the back of i t which was a 12 tear off of a computer p rin t-o ut, so this was 13 computer paper. 14 112 Q The statement that you got from Guinness & Mahon, 15 did that show you what your account was or what was 16 in your account? 17 A 18 113 Q 19 A Yes . So i t was different to this document? I don't know, I think this was the sheet of paper I 20 referred to as being the balance and the last credit 21 and debit. 22 the interest being applied to the total amount, that 23 is what I think. 24 114 Q The other sheet of paper may have shown You say a computer print-out or this seemed to have 25 been torn off from the computer p rin t-o u t. 26 relation to the other document there was a covering 27 le tte r from Mr. Traynor or somebody saying "herewith 28 the account..." and whatever i t was, but then there 29 was another statement, did i t have a heading on i t , In 1 2 A. 3 115 Q. 4 Yes, I believe i t did. Mr. Doyle, I wonder have we the same numbered pages as yours, i t is 174 we have? 5 A. 6 116 Q. 7 A. 8 117 Q. 9 Yes, 174 and 175. Look at 174 (Exhibit 4)? Yes. That was the document that you got and behind this was the computer print-out? 10 A. 11 118 Q. 12 A. 13 119 Q. Yes. That document has got no heading on i t . I see that. Perhaps i f I just hand you another document, i t is 14 purely a specimen document and has nothing to do 15 with your case, but i t is the sort of document that 16 would appear (Exhibit 5). 17 assist your recollection now, Mr. Doyle, that that 18 was the type of statement that you would have 19 obtained? 20 A. (SAME HANDED). I t does because that is the same as the copy here 21 which I have provided. 22 Guinness & Mahon heading on i t . 23 120 Q. 24 A. 25 121 Q. 26 I also thought there was a There is not on that? No. There does not seem to be one on the photostat that we have? 27 A. 28 122 Q. 29 Does that No. These are documents that you have got and produced. 1 2 Yes. 3 because we moved to Spain, I had in an old c u ff-lin k 4 box wrapped some old bank books I had and I had 5 remembered seeing one statement and some piece of 6 paper that I had retained over the years. 7 day of the Tribunal I went looking for that and I 8 found the pieces of paper as I remembered them where 9 they were and managed to locate them. 10 123 Q 11 A 12 124 Q 13 A On the day of the Tribunal I went home and On the You have looked at them? Yes, they are the only papers that I have retained. Very well. I didn't know at that stage that I had actually 14 retained them, but I hadn't been asked for any 15 papers at that stage. 16 125 Q Very well. Can we go back to your statement on 17 page 2, do you see paragraph D on the bottom of page 18 2? 19 A 20 126 Q Yes . "In the course of my dealings with The Company only three withdrawals were made from my account, the third of which served to close the account... ." 21 22 23 24 When was the account closed? 25 A 26 127 Q 27 28 29 In 1993, I think I read here this morning, July. No, I am not talking about what you read. Can you recollect ? A I couldn't without referring. My memory in relation to the time line of this is - - I would have thought 1 from day one that the years were different than they 2 were. 3 actually closed i t in 1993. 4 128 Q 5 A 6 129 Q 7 A 8 130 Q 9 A 10 131 Q 11 12 How did you find that out? Because i t was in the documentation. Where? Have you got i t there? I saw i t this morning. Have you found this? I am just trying to locate i t . (Pause). Would you turn to page 182(3), is that what you are referring to, Mr. Doyle (Exhibit 6)? A No, i f you can just give me a moment, I thought i t was a le tte r, I saw i t here this morning. 13 14 I actually thought I closed i t in 1991 and I 132 Q Mr. Doyle, do you know whether these are anything to 15 do with your money on deposit in the Cayman? 16 these your own personal accounts here in Dublin? 17 A 18 133 Q 19 A 20 That is page 182? Do you know what these documents relate to? I thought i t was a le tte r from Des Traynor saying to close the account. 21 134 Q 22 A 23 135 Q 24 These are Guinness & Mahon documents in Dublin? Yes . You had an account in Dublin, of course you had an account in Dublin and we know about that. 25 A 26 136 Q Yes . I am not interested in that, that is an ordinary 27 resident account. 28 . . . . (INTERJECTION) . 29 Are A Do you know whether this was No, that is what I said, i t is not actually this 24 1 2 137 Q 3 A Sorry? I was actually looking for a le tte r from Des Traynor 4 to somebody in the bank requesting the account be 5 closed. 6 138 Q I have an account but this is your Guinness & Mahon 7 account, your ordinary resident account which was 8 closed in July 1983. 9 A 10 139 Q 11 A 12 13 1983? On 13th July 1993? Sorry, that is the account I was referring to, I saw a reference to i t in a le tte r. 140 Q 14 I am talking about your relations . . . . (INTERJECTION). 15 A 16 141 Q 17 A The Cayman Islands account? The Cayman Islands account, yes. I t was closed after 1988 because I got concerned 18 after my father died, so I would have thought i t was 19 1990/91. 20 142 Q 21 A 22 23 143 Q I believe You asked him for a cheque for the total amount of the account? 25 A 26 144 Q 27 29 I asked Des Traynor to close the account. I asked him for a cheque back for the total amount. 24 28 T e ll us how i t was closed and what happened? Yes . What did you do with the cheque then? Where did you deposit i t then? A I deposited i t in another off-shore account that was returned in its entirety to the Revenue. 1 145 Q 2 A 3 146 Q 4 We have had reference to an account in Liechtenstein that your father had maintained, was this it? 5 A 6 147 Q 7 A 8 148 Q 9 10 No. Well, i t was my own account. Your own account? Yes . Anyway I do not want to go in to your own private affairs, I am only concerned about Ansbacher. A To add to i t , I remember being aware at the time not 11 wanting to upset Des, so I believe I asked him for 12 payment to myself by way of cheque, so that he 13 wouldn't - - in other words, I could have said 14 transfer i t to there, but not to indicate to him 15 that I thought there might be a problem with him, I 16 actually asked him for the money myself, I believe. 17 149 Q So you got the money. Who were your advisors then? 18 Did you go to some of your advisors, your 19 accountants or legal advisors about this Trust, this 20 other money? 21 A Yes, I was aware that my father had a Trust or an 22 account and one of the advisors arranged for 23 . . . . (INTERJECTION). 24 150 Q 25 A No, I think i t could have been the Company Secretary suggested ....(INTERJECTION). 26 27 151 Q 28 A 29 You went to his advisors about this? Mr. Carville? Yes, suggested that, because I remember going to . . . . (INTERJECTION). 1 152 Q 2 That was the end of your relationship with the Cayman Islands company? 3 A 4 153 Q 5 A Yes . That was, you think, in 1993, was i t , did you say? No, sorry, I thought the le tte r referred to that. 6 No, some time after 1988 because that was the time 7 my father died. 8 154 Q 9 A I t was after your father's death? Yes, and the connection re a lly with Des was through 10 my father. 11 I am only trying to remember the time line again, I 12 think i t was the Russell Murphy a ffa ir with Gay 13 Byrne. 14 155 Q 15 A 16 156 Q 17 18 I got concerned as a result I think, and So you decided to take the money out then? Yes . That was the third transaction. What other transactions did you have re withdrawing of funds? A I think I asked Des for money to purchase a car, 19 which I did at some stage ask him for money to 20 purchase a car. 21 157 Q 22 A Yes . The other one I don't know, I may have asked him for 23 money and returned i t . 24 actually asked him for money and put i t into 25 Liechtenstein, I actually don't know. 26 158 Q 27 The car would not have been a very substantial sum of money, I take it? 28 A 29 159 Q I am sorry, I may have Unfortunately i t was. I t was? 1 2 160 Q. 3 A. 4 161 Q. 5 A. 6 162 Q. 7 A. 8 163 Q. 9 A. 10 164 Q. 11 12 How much was it? I t was a Mercedes SL. How much was it? I think i t was about £80,000 or £90,000. Do you remember when that was? That was in 1990 because that was the registration. 1990? Yes. I f that was before the last one, the last one must have been after that? A. Yes, I accept that and that is what I am saying. I 13 don't recall exactly what I said to Des, but I would 14 have closed the account, I believe, shortly after 15 that that, maybe six months after that. 16 165 Q. 17 18 1991 perhaps? A. 166 Q. 21 I do remember getting the cheque for That would have been three years after your father's death? 22 A. 23 167 Q. 24 25 Perhaps, yes. the car from Des. 19 20 So we are then talking about closing the account in Yes. That is the closing of the account and then the car in 1990. A. What was the f i r s t withdrawal? I actually don't know because I have trie d to 26 account for i t and I haven't been able to. 27 feeling i t may have been to purchase something or i t 28 could have been a drawdown into the Liechtenstein 29 account, I don't know. I have a I didn't purchase - - in 1 other words, I remember spe cifically buying the car, 2 but I don't remember purchasing anything else. 3 168 Q You have a recollection and you say i t in your 4 statement on three occasions that you had made 5 withdrawals. 6 A 7 169 Q 8 9 A The f i r s t withdrawal, No, according to the paper here - - sorry, I understand i t is £100,000 odd. 170 Q 12 13 You have accounted for two. was i t a substantial sum of money, do you remember? 10 11 Yes . I t is not your understanding, i t is your recollection I am concerned about. A 14 Prior to receiving the paper I have no recollection of i t . 15 171 Q 16 A Receiving what paper? The Tribunal papers with the statements, I had no 17 recollection of i t , but in trying to account for i t 18 to my previous so lic ito rs , I couldn't put my finger 19 on anything that i t was actually for. 20 that i t may have been me taking the money from Des 21 to put in . . . . (INTERJECTION). 22 172 Q 23 A 24 173 Q 25 A 26 174 Q 27 I presume Have you any recollection of i t at all? I don't to be honest. None at all? No. So you have no recollection of the substantial sum of money which was withdrawn from your account? 28 A 29 175 Q No. So you are trying to do the best you can, you are 29 1 trying to think of various p o ss ib ilitie s that may 2 have arisen? 3 4 176 Q. I wonder are we talking about the figure that 5 appears of £111,633.28 on 23rd July 1987, is that 6 what we are talking about? 7 A. 8 177 Q. 9 A. 10 What page are you on? I am not on any page that you have there. 1987, no. Sorry, that may have been a draw out to put in Liechtenstein. 11 178 Q. 12 A. 13 17 9 Q. 14 A. 15 180 Q. Is that what we are talking about? I don't actually know. You do not know? No, I would presume ....(INTERJECTION). How could money have been drawn from the Cayman 16 Islands, over £110,000, and be moved to 17 Liechtenstein without you knowing it? 18 A. Sorry, I am not saying that I didn't know i t at the 19 time. 20 money and I don't have a l i s t of . . . . (INTERJECTION). 21 181 Q. 22 What I have tried to do is account for the Mr. Doyle, you say in your statement that you made three withdrawals. 23 A. 24 182 Q. 25 A. 26 Yes. Do you remember making three withdrawals? I remember specifically asking for the money for the car de finitely, I remember that withdrawal. 27 183 Q. 28 A. 29 184 Q. A l l righ t. I don't remember the 1987 withdrawal. I f I may interrupt you, Mr. Doyle. I just want to 1 find out what your recollection is . 2 buying the Mercedes car? 3 Yes . 4 185 Q 5 You recollect You recollect closing the account in 1993 and you have no other recollection of any other withdrawal? 6 A 7 186 Q I don't. Very well. I think we w ill break now, Mr. Doyle, 8 for a cup of coffee or a cup of tea for about ten 9 minutes. 10 11 12 (SHORT ADJOURNMENT) 13 14 15 187 Q MR. JUSTICE COSTELLO: 16 Mr. Doyle, we w i ll resume now. I just want to ask 17 you about another topic now and that is about the 18 Thornhill Trust. 19 A 20 188 Q Yes . We know this was established by your father and your 21 mother and i t was for the benefit, I think, of his 22 children and grandchildren. 23 your family? 24 A 25 189 Q A 28 29 Sorry, who are the members? Were and are. There was your brother, who is your brother? 26 27 Who were the members of Due to family differences i t might be were. brother Michael. 190 Q Yes . My 1 A 2 191 Q 3 A 4 192 Q 5 A 6 193 Q 7 A 8 194 Q 9 A 10 195 Q 11 A 12 196 Q 13 Eileen what? Eileen Monaghan. Yes . Ann Roche. She is Mrs. Roche? Yes, and Bernadette Gallagher. Your brother? Sorry, Michael Doyle. You had one brother and three sisters? Yes . Did you have any relative on your mother's side or your father's side called a Mrs. Barrett at all? 14 A 15 197 Q 16 A 17 198 Q 18 19 My sister Eileen. No. You did not? No. I just want to ask you about the Thornhill Trust. Do you remember when i t was wound up? A I don't. Again last year I was asked by Brian 20 O'Donnell & Partners did I know anything about the 21 Thornhill Trust. 22 i t was called after the family home so i t is 23 obviously related, but I don't remember the 24 specifics of i t . 25 there was a second Thornhill Trust. 26 199 Q 27 A Outside of saying well obviously I was also informed then that Sorry? I was informed then that the Tribunal were asking 28 about a second Thornhill Trust and I was told that 29 i t was active up u n til last year or the year before, 1 whenever the Tribunal started, or there were 2 transactions going through i t . 3 200 Q 4 A Yes . On that basis everybody was asked did they have 5 anything to do with i t and everybody said no. 6 Particularly i f i t was active, i f i t was terminated 7 at some stage in the past somebody might have said, 8 'well, is there a p o s s ib ility that that second one 9 is connected?' Because i t was s t i l l active nobody 10 knew anything about i t , so i t was presumed that i t 11 was not, that i t was just coincidence that i t was 12 called that. 13 about the workings of i t . 14 saying at this stage rather than later that I am not 15 on speaking terms with any of the family members or 16 any of their advisors for a long time due to a 17 family battle, so I haven't had the, I suppose, the 18 a b ilit y or the opportunity to s it down with people 19 and say, 'what about this and what about t h a t . ' 20 Whereby people would say to you, 'do you not 21 remember this?' 22 201 Q 23 A 24 25 So in the i n i t i a l one, I don't know I am probably better off . . . . (INTERJECTION). Have you been in touch with Mr. Corrigan? No, other than sending him a fax to ask him was there anything I should . . . . (INTERJECTION). 202 Q Mr. Corrigan wrote to you and told you that i t had 26 been wound up, the original Trust. 27 Trust was 1964 and was in Ireland and Mr. Corrigan 28 and the accountant were trustees of i t , is that not 29 right? The original 1 Yes, I would have thought that was Thornhill 2 Incorporated. 3 203 Q 4 That Trust owned the shares in Thornhill Incorporated. 5 A 6 204 Q 7 A 8 205 Q 9 A Okay. You were a Director of Thornhill Incorporated? Yes . When did you last have a meeting of the companies? I would have thought p rior to the sale of my shares 10 at some stage because i t would have been the vehicle 11 that Jurys were purchasing. 12 206 Q 13 A Sorry? Thornhill Incorporated would have been the vehicle 14 that Jurys were purchasing, so I would have been 15 present at a Board meeting of i t at some stage 16 before ....(INTERJECTION). 17 207 Q 18 A 19 208 Q 20 A 21 209 Q 22 A 23 24 When was that? Probably two years ago. So Thornhill Incorporated was a trading company? Yes . Did i t own Jurys Hotel, did you say? No, no. Sorry, i t was the owning company of most of the shares that were held. 210 Q Thornhill Incorporated had assets and its assets 25 included shares? 26 I am presuming that they did because that is the 27 vehicle that Jurys purchased, so I would understand 28 that everything was consolidated under 29 . . . . (INTERJECTION). 1 211 Q 2 A 3 212 Q 4 When you say "Jurys," is this the Jurys Hotel Group? Yes . Did they purchase the business that had been carried on by the Doyle family? 5 A 6 213 Q 7 Yes . The manner in which that sale took place was through the sale of shares that Thornhill owned? 8 A 9 214 Q 10 A Yes . This happened a couple of years ago, you think? Jurys made the purchase a year and a half ago, I 11 would have sold out p rior to that, probably six 12 months before that. 13 would have had to sign off . . . . (INTERJECTION). 14 215 Q So some time during that I So Thornhill Incorporated was an active holding 15 company up to the time the business was sold to 16 Jurys, is that the position? 17 A Yes, I would have thought so. Most of the dealings 18 from our own point of view would have been PV Doyle 19 Holdings which was a company below that. 20 216 Q 21 Yes. The company remained in existence, Thornhill Incorporated, i t was an unlimited company. 22 A 23 217 Q I believe so. You wrote to Mr. Corrigan about this matter and 24 Mr. Corrigan wrote back on 5th May of this year 25 (Exhibit 7). 26 paragraph 1 he refers to the Trust being established 27 in 1965 and he says: 28 29 (SAME HANDED). Do you see in "The shares in Thornhill Inc. were distributed equally, as far as I know the only assets le ft are some penny shares in Th o rn h ill." 1 2 Did that distribution take place after the sale to 3 Jurys ? 4 I am sorry, could you repeat the question? 5 218 Q 6 A 7 219 Q I f you look at the le tte r (Exhibit 7). Yes . Mr. Corrigan says: 8 "The shares in Thornhill Inc. were distributed equally, as far as I know the only assets le ft some penny shares which are valueless and some cash in the Bank of Ireland." 9 10 11 12 I t was an unlimited company, apparently? 13 A 14 220 Q 15 16 Yes . Can you explain what Mr. Corrigan is referring to there? A I am presuming that i t may have been that there was 17 a re -jig g in g after my father's death of the 18 shareholding in the company in relation to maybe 19 preference shares and ordinary shares. 20 stage there was, I suppose i f you want to call i t , a 21 defined distribution. 22 deal, so I don't know what the wind up situation 23 was. 24 221 Q At that I wasn't there for the Jurys I had been fired at that stage. You go on in your le tte r to Mr. Corrigan, i f you 25 look at the page on 2nd May where you wrote (Exhibit 26 8) : 27 28 29 "The relevant documents... are currently held by Brian O'Donnell & Partners." 1 2 A. 3 222 Q. 4 A. 5 223 Q. 6 A. 7 224 Q. 8 Brian O'Donnell & Partners? Yes. He is the s o lic ito r. Your solicitor? Yes. You say that you had written to him about the relevant documents about Thornhill. 9 A. 10 225 Q. 11 Yes. Do you know have they been included in the documents that you sent us? 12 A. 13 226 Q. 14 A. I am presuming. Sorry? I presume that they were. What I was doing here was 15 I was putting a le tte r out to him to say whatever 16 information I am entitled to or due or the 17 Inspectors are due, would you mind supplying them. 18 227 Q. In relation to your entitlement to an interest in 19 Thornhill, your so lic ito rs , Mr. O'Donnell, can help 20 us or would know about that? 21 A. Yes, they represented the family in the transaction. 22 228 Q. They would have f u ll information about your interest 23 in Thornhill? 24 A. 25 229 Q. Yes. Very well. We can ascertain from them the position, 26 i f necessary. 27 point you have just made, namely, the existence of a 28 second Trust called Thornhill in the Cayman Islands. 29 Was that matter brought to your attention in the I want to refer you, Mr. Doyle, to a 1 Moriarty Tribunal? 2 Not in the Tribunal it s e lf on the day, but outside 3 of that papers were sent to us asking us did we have 4 any knowledge of i t . 5 230 Q 6 A Sorry? Papers were sent to us. I t wasn't brought up on the 7 day, but papers were sent to us asking us did we 8 have any knowledge or asking did we have any 9 knowledge of the Trust. 10 231 Q 11 A Who asked you about this? Brian O'Donnell & Partners asked me to reply to a 12 le tte r that they had received from the Tribunal. 13 They put the question to me did I know anything 14 about this Thornhill Trust to which my reply was no 15 and i t was based on the fact that they said, 'and by 16 the way, i t had been active up u n til the time of the 17 start of the T rib u n a l,' so some time after that. 18 i f the answer had been i t was a dormant trust or i t 19 wasn't active, I would have said, 'well, I don't 20 know anything but i t is funny that i t is related to 21 the name.' 22 I am presuming that there was no way that anybody 23 could have retained... 24 232 Q So The fact that i t had s t i l l been active, I f I understand what you are saying to us, 25 Mr. Doyle, i t is that i f there was a Thornhill Trust 26 in the Cayman Islands and i f i t was active in the 27 sense of distributing funds, i t had nothing to do 28 with you? 29 Absolutely not. 1 233 Q 2 A 3 4 Exactly. I was told i t was active, I think, this time two years ago or March certainly of that year. 234 Q Did you make any enquiries from members of your 5 family about the fact that the name of your family 6 Trust, which I understand was the name of your 7 family dwelling house. 8 A 9 235 Q 10 Yes . Was used for a Trust that was based in the Cayman Islands? 11 A 12 236 Q 13 A Yes . You made enquiries? Sorry, of Brian O'Donnell, I don't have - - and again 14 I suppose I better say i t - - I don't have a speaking 15 relationship. 16 237 Q 17 A I see, so the answer is you did not then? No, Brian O'Donnell placed the question to me, I 18 placed the question conversely to him, 'did anybody 19 else know about i t ' and his answer was 'no.' 20 238 Q 21 So you were told by your brothers' and sisters' solicitors that they knew nothing about it? 22 A 23 239 Q Exactly. Yes, I see. Mr. Doyle, thank you for your 24 assistance. That is a ll we wish to ask you today. 25 I t is possible we may have to recall you when we 26 have examined further documents, but at the moment 27 that is a ll we need to ask you. 28 I had asked the question when you were out of the 29 room in relation to the question you were asking me 1 about the Amnesty. 2 any of the advisors of the family, but there was a 3 position a few years ago where basically whatever - ­ 4 well, there was a big f a ll-o u t. 5 240 Q Unfortunately I don't speak to I t does not matter. These things happen in 6 families, Mr. Doyle. They happen and are 7 regrettable, but t e l l me what you want to say. 8 A Basically I was told that my solicitors met with 9 Terry Cooney and that he had indicated to them that 10 i t was actually the 1993 Amnesty, so just to answer 11 your earlier question. 12 241 Q This is what I understood to be the position, I 13 implied that that was the position. 14 that point, I take i t you had an accountant dealing 15 with your own affairs in relation to the Amnesty? 16 A 17 242 Q 18 A 19 243 Q Just to c la r ify Terry Cooney represented everybody. Mr. Cooney represented you too? Yes . So Mr. Cooney would be in a position to advise you 20 and us, i f necessary, on the point you have just 21 made, that i t was the Amnesty that was used and that 22 included in the settlement was the tax unpaid on the 23 interest? 24 Yes. 25 everything was returned to Terry Cooney. 26 asked to sign a piece of paper. 27 and he then gave me back the balance basically and 28 everything was definitely included in i t . 29 it. A ll funds - - I wasn't happy at the time, but I was He got the funds That is MR. JUSTICE COSTELLO: END OF INTERVIEW 41 Thank you, Mr. Doyle. 2/974 0777?; ofntk?u UCV um/??zkh? 0 TO: Office of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Ltd STATEMENT OF Mr DAVID DOYLE PRELIMINARY This statement Is as full and detailed as my memory and records can afford. On 17th December 1993, a settlement was reached with the Revenue Commissioners regarding the tax affairs of myself, the Doyle Hotel Group and the rest of my family. That settlement was handled by Mr, George Carville and Mr William Corrigan of the Doyle Hotel Group on behalf of that Group and the individual members of the Doyle family. Mr Terry Cooney was engaged as a tax advisor primarily to deal directly with representatives of the Revenue Commissioners. I am aware that a letter was furnished by the Revenue Commissioners to Mr. Terry Cooney confirming that such a settlement was reached. I have made attempts to procure such information as I believed necessary from Guinness and Mahon Bank, the Doyle Hotel Group and the estate of the late Mr Des Traynor. I therefore make this statement based on such records as I have currently to hand, and based on my recollection of events. I should add that when I moved from my parents’ home in or about 1991 I dealt with and disposed of papers as they came to hand. Cavman Trusts and Trust Companies I cannot recollect my ever having executed a Deed of Trust or other instrument in the Cayman Islands or elsewhere in connection with Guinness and Mahon and/ or Mr Des Traynor. . I am further unaware of ever having caused to be established in the Cayman Islands or elsewhere any body corporate or other entity in connection with Guinness and Mahon and/ or Mr Des Traynor. I would state that i am now familiar, to a certain extant, with trusts and believe that had I established a trust, i would have been aware of so doing. I therefore cannot furnish any documentation or details as sought in questions (1) (a) to (1) (g). The Use of Deposits Maintained with the Company Deposits made With the Company. In the early 1980's, as a young man, I was in the fortunate position of having a substantial amount of money to my name and enjoyed relatively high earnings from my employment within the Doyle Hotel Group. I became concerned regarding the privacy of my financial affairs and, indeed, regarding my personal security should the money at my disposal become common knowledge. I believe It relevant to mention that In the early 1980's, my family and I were very conscious of the threat of kidnapping. I was accompanied to work on many occasions by Garda detectives, and staff and management at Doyle Hotels were sensitive to suspicious characters. I had worked In the USA for a number of years In the late 1970's. When I completed my training In the USA I returned to Ireland and took up the position as Trainee Manager of the Berkeley Court Hotel. I was aware that Mr Des Traynor was the Chairman of Guinness and Mahon. Mr Traynor was a personal friend of my late father and a regular customer of Doyle Hotels and became well known to myself and the rest of my family as a result. At some point in time in-1982 or 1983,1made a profit from dealing in ■ the shares of, I recall, Atlantic Resources. About this time an account was opened in my name in Guinness & Mahon Bank by Mr Traynor, into which these proceeds were deposited. Principally for security and privacy reasons, I wished to open an account with a small bank. At that time, Guinness and Mahon’s operations in Dublin consisted of one branch, 'and included the provision of private banking services to high net worth individuals. " ( do not recall signing any extraordinary documentation of a banking nature. I specifically recall signing a .one page document in a car park in or around 1985, but I do not recall that document being anything other than routine, similar to a mandate of some description. This document was presented to me by Mr. Des Traynor. My dealings with the Company commenced in or around 1983, to the best of my recollection. I made regular deposits, in the region of two or three per year, up to 1989 or 1990. Lodgments were made by my handing bank drafts, cheques and/ or cash to Mr Traynor, whom I saw on a regular basis in Doyle Hotels, principally the Burlington Hotel and the Berfcely Court Hotel. If Mr Traynor was unavailable for any reason, I would contact his secretary, Ms Joan Williams, with whom I was acquainted, and she would inform Mr Traynor of my wish to see him. In due course I would receive a statement, addressed to me at my home address, which consisted of a note on Guinness and Mahon headed notepaper, together with what appeared to be a printout from a computer which showed the date and the amount of the most recent transactions, together with the balance in my account At all times I believed that I had a bank account, and was not under the impression that it involved any sort of trust. I would further state that I did not find anything out of the ordinary in such dealings with Mr Traynor. Private banking, in my experience, is substantially different from normal retail banking and involves few if any conventional over the counter transactions. In the course of my dealings with the Company, only three withdrawals were made from my account, the third of which served to close the account and terminate those dealings. On each of these occasions, I contacted Mr Traynor and informed him of how much money I required and when I required same. In each case I received the money requested as requested in the.form of, I believe, a., cheque or bank draft. r? I am unawareof any steps taken by Mr Traynor In the deposft or withdrawal of my money. I was never informed of any procedures of a banking or accounting nature which had to be followed. I requested the money and received It. • (e) JU On the three occasions upon which I effected withdrawals from my account with Guinness & Mahon, I believe I caused same to be lodged or transferred to a personal bank account. On each occasion that I requested that funds be withdrawn, it was for a specific purpose, and I paid no attention to the name of the account upon which the cheque was drawn or the bank upon which the draft was drawn. I received my money and applied it for such specific purpose. •AI have no recollection of seeing any of the names of the companies set out in question (2)(e) in connection with any o f my dealings. (f) As stated above, I received statements from, as far as I was concerned, Guinness and Mahon Bank. These statements were addressed to me at my home address and contained details of the latest transaction and the running balance on my account There may have been a code of some description on the computer printout but if there was I was not aware of it. (3). This question appears to be Identical to question two, except insofar as it appears to state that Irish Intercontinental Bank provided the role that--------Guinness and Mahon had done previously. I have no recollection or documentation regarding any dealings involving Irish Intercontinental Bank . K.) (4). At no time did I avail of any loan or guarantee facilities nor did I offer my deposits to act as backing for loans or provide any guarantees to any third parties. My family and I were made aware, however, in 1988 by Mr William Corrigan and Mr George Carville, Chairman and Secretary respectively of Doyle Hotels Group, that my late father had a loan outstanding with Guinness and Mahon. ' In the company of Messrs Corrigan and Carville, I met with Mr Des Traynor in the Berkely Court Hotel shortly after the revelation of this loan. Mr Traynor explained that the loan had been taken out for the benefit of Mr Charles J Haughey, and that there was little chance of recovering the money from him. At that'meeting, Mr Traynor did not explain the details of the transactions involved in borrowing the money or applying the money for Mr Haughey’s benefit. I would repeat that at no time did I avail of any loan or guarantee facilities nor did I offer my deposits to act as backing for loans or provide any guarantees to any third parties. ' I am unaware of any applications being made on my behalf under the Exchange Control Acts for any purpose. I am unaware of any connections with the Channel Islands or any of the companies referred to in question (7). In the course of receiving documentation from the Moriarty Tribunal, I have become aware of certain dealings regarding Doyle London Hotels Limited and the Company. I am unaware of the details of such dealings. I am unaware of any dealings with the Company by any subsidiaries of any bodies corporate with which I was or am Involved. I am unaware of any dealings with the Company by any other entities related to any bodies corporate with which I was or am involved. I am unaware of any trusts which had dealings wfth the Company. . ! DATE 3 1 MAR 6 9 * „ . A L A ; l Ci. I t i M A R £J9 D<\ A J '.‘ O iA P R b '7 L vin^eo 2 0 APR 89 . j Oo L^ _ [• U IJ ij H T DEBIT VALUE DATE PARTICULARS l-n=.WARD . / '? \ ! ‘ IENT DATE . .3 CREDIT BALANCE. ?3,493.03 lumou 131398.03 11000.00 14,398.03 125.00 '14.523.03 \ . . A cco u n t S ta te m e n t A c c o u n t: 11140005 S ta te m e n t s t a r t S el U a lu e D a te 17A PR 90 DOVLE D A V ID P o s t A m ount T R A N S FROM F IX E D D E P O S I T 2 6 A P R 9 0 HR D A V ID ODVLE R E T E N T IO N _ 23JL V 91 (31 B a s e 01JL V 93 C r e d it 05JL V 93 C r e d it 2 9 .5 9 D R 9 8 .6 4 C R 8 .2 5 B a se R a te C hange B a se R E T E N T IO N - 0 .0 0 C R R a te 5 .0 0 .0 0 O .O O C R 6 .0 0 11140004 1 3 8 , 2 8 1 .3 4 C R 1 3 8 , 2 8 1 .3 4 C R 1 3 8 , 4 1 4 . 09D R TAX 4 9 .0 9 D R IN T E R E S T A P L IE D 1 0 .0 0 C R G R O SS 1 3 J L V 9 3 D A V ID DOYLE Cmd 4 0 .0 0 0 .0 0 C R 4 0 ,0 6 9 .0 5 D R R a te FROM ACCOUNT ~ 4 0 , 0 0 0 . OOCfl TO D A T E D e b it R a te I B a la n c e 0 .0 0 C R TAX 8 .2 5 _ CALL D f f O S I T b r o u g h t fo r u a r d IN T E R E S T 1 8 :1 1 :2 7 01JA N 87 N a r r a tiv e B a la n c e _ I ff 1 3 /0 7 /9 9 ' 1 8 1 .8 4 C R B < it, t c 0 .0 0 C + n S CORRIGAN & CORRIGAN o l 3, ST. ANDREW STREET DUBLIN 2 S O L IC IT O R S W. J. D. M. C. M. 6. M. P. G. CORRIGAN, motahynjiuc CORRIGAN. B.C.L. NOTAXVMnuC MURPHY. B.C.L. ’ CORRIGAN, 8.C.L.. A.C.I.I. mZSIMONS. 8.C.L. ■ TELEPHONES: 8778108 8776927 * 8774244 PAX: 8794392 ' e m a i u c o r r lg a n O s e c u r e m a ll.ie 5 May 2000 David Doyle Esq. -Casa El Pino Urb. Santa Petromlla MarbeUa 29600 Malaga Spain Our Ref: WMC/AT Dear David I acknowledge your letter o f 2ndinst and note your queries. - The only trust that was involved, as fer as I know, was the trust that was setup on 15thFebruary 1965 by your father and your mother in which Joe Chariton and m yselfwere appointed Trustees. The assets o f that trust were the shares in Thornhill Inc. and a bank account in the Bank o f Ireland. The beneficiaries o f the trust were the children and grandchildren o f your parents. The shares in Thornhill Inc. were distributed equally and as fer as I know the only assets left are some penny shares in Thornhill, which are valueless and some cash in the Bank o f Ireland. With regard to the Moriarty Tribunal and the payments for the benefit o f Mr Haughey, the first any o f us knew o f this was shortly after your father’s death when we were told that there was money due to Messrs. Guinness and Mahon from an account in your fathers’ name which we were told had been used for the benefit o f Mr Haughey. It was at that time that we all decided that the account should be discharged immediately as interest was running. We were also told at that stage by Mr Traynor that there was absolutely no hope o f the monies being repaid by Mr . Haughey. With regard to the letter from the inspectors, if you could send me a copy o f that letter I w ill take the matter further. ’ If I come across any further information, 1 will of course let you know. CASA EL PINO • URB. SANTAPETRONDLLA MARBELLA 29600 MALAGA SPAIN. ATdMR WILLIAM CORRIGAN. . 2nd M AY00 Dear Mr Corrigan • I have received a letter from the ‘ Inspectors’ for the Moriarty Tribunal, requesting nrfhrmatinn re any oflshore trusts , accounts etc, that I nmy have been a beneficiary o£ Including accounts, papers etc o f sam e. I am requesting information from you that may be in your possession re the above as a result o f you having been ‘Trustee’ o f my late fathers estate as w ell as the Chairman o f Thornhill inc. And in the light o f the fact that you took control o f his af&irs after his death. I would request that you would forward roe mfbnnation in your possession that would come under the briefo f the ‘ Tribunal’ andthe Inspectors. So that I can respond as required by the High Court order. The relevant documents we are all responsible to answer I believe are currently held by Brian O Donnell and Partners. I have already addressed a similar letter to Brian O Donnell re * Thornhill inc * and its Directors. Yours Sincerely .— DAVID DOYLE THE HIGH COURT IN THE MATTER OF THE COMPANIES ACTS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES ACT 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R eport of th e In spe c to r s A p p o in t e d to E n q u i r e in t o t h e A f f a ir s o f A n s b a c h e r ( C a y m a n ) L im it e d Published by Order of the Court made on 24 June 2002 V o lu m e [5 ]: A p p e n d ix X V ( 3 0 ) t o X V ( 4 2 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (30) Mr P Vincent Doyle, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r P Vincent Doyle. a) Extract from transcript of evidence of M r George Carville dated 17 M a y 2000. b) Extract from transcript of evidence of M r William Corrigan dated 18 July 2000. c) Letter of 22 August 1983 from Guinness M a h o n & C o Ltd to P V Doyle Hotels Ltd. d) Internal Guinness and M a h o n m e m o of 11 June 1984. e) Guinness M a h o n & C o telex of 28 August 1987. f) Letter of 2 September 1987 from JD Traynor to Guinness and Mahon. g) Guinness M a h o n & C o telex of 2 March 1988. h) Undated schedule of loan interest paid by Doyle London Hotels Ltd. i) Guinness and M a h o n statement of account of 20 February 1983 re G M C T a/c re IH Investments Inc. j) Letter of 28 September 1990 - J D Traynor to Doyle Hotels Group. 1 128 Q. I want to ask you a couple of questions about thi paragraph. You say: 2 "In 1977 the late Mr. P. V. Doyle set up a Liechtenstein establishment which received commissions from Extern Travel Inc." 3 4 5 6 what do you mean by "an establishment■? 7 company or was it a trust? A. 8 9 .• was it < I am led to believe an establishment was what we would classify as a trading company. * 129 11 Q. A trading company? A. Yes. 12 13 foundation and an establishment. 130 14 Q. Yes? A. And I am told that an establishment is a trading IS 16 company. 131 17 18 132 9 20 133 21 22 134 23 24 135 25 26 136 27 28 29 There are two things in Liechtenstein, a 137 « Q. A trading company? A. Yes. Q- Do you know what it was called? A. Can I refer to my notes. Q. Yes, certainly? A. It was called Reisen. Q. Could you spell that for me? A. R-e-i-s-e-n. Q. Yes. A. welt. Q. Yes? A. w-e-l-t. Q. Yes? A. Weit. I think it is W-e-i-t. 138 2 3 139 4 5 140 141 A. Two, two words. Q. Which way are they broken up? Q. Reisen? Q. Yes? A. And Weltweit. 142 Q. Weltweit is the other? A. Weltweit, yes. 10 11 Are they three words or all one word? A. Reisen Is one word. 8 9 Yes. A. Pardon. 6 7 Q. 143 Q. Weltweit, yes. Grand. You then go on to say: "It received commissions from Extern Travel Inc., a U.S. corporation." 12 13 14 The U.S. Extern Travel was finally, according to 15 your statement, owned 16 family members. 17 this company? 18 19 144 as to five-sixth by the Doyle They were majority shareholders in A. Eventually, yes. Q. As I understand your statement, commissions from 20 this company were paid to this Liechtenstein 21 establishment? A. 22 — 23 24 145 25 26 146 27 28 29 They were paid to Extern first. 147 We had an American the majority of the visitors coming to Ireland. Q. Yes? A. In proportion. Q. Yes? A. were Americans. Q. Yes? A. I think at that stage it was about 25% or 28%. 20 1 . 1 1 48 2 3 149 4 5 150 6 7 151 8 Q. Y es ? A. The B r it s Q. Y es? A. The I r i s h . Q. Y es ? A. A nd t h e n o t h e r c o n t i n e n t a l s . Q. Y e s ? A. s 9 152 1 53 14 15 154 16 17 155 18 .. 156 20 21 157 158 c o m m is s io n . A. T o t h e A m e r ic a n com pany, Q. Y es? A. Y e a r s b e f o r e t h a t we h a d a New Y o r k o f f i c e . Q. Y es? A. in Q. Y es? A. We w e r e i n th e 1 9 5 0 'S . B o rd P a i l t e , Q. we n e e d n o t g e t i n t o A. S o rry . Q. To t r y E x te rn . in P if t h Avenue. t o o much d e t a i l ? O kay. an d e x p e d ite t h i s w h o le t h i n g a s much as A. O kay. Q. Y ou e f f e c t i v e l y , t h e G ro u p , p a i d a c o m m is s io n t o E x te r n T r a v e l? 26 29 a n A m e r ic a n Y o u p a i d t h a t t o who? 25 °8 if p o s s ib le ? 23 27 Mow, Q. 22 24 th e h o t e l. s t a y e d t h r e e n i g h t s we p a i d t h r e e n i g h t s 12 13 A nd w e w e r e p a y i n g a c o m m is s io n o n e v e r y t i m e a n A m e r ic a n s t a y e d i n <1^ 11 w e re n e x t . 159 A. Yes. Q. E x te rn T ra v e l in R e is e n W e l t w e it ? A . To L i e c h t e n s t e i n . t u r n p a i d a c o m m is s io n t o th is 1 160 2 3 Q. in Liechtenstein? A. Yes. 161 Q. Later there was a second Liechtenstein 4 establishment, which was called what? 5 A. Weltreisen, W-e-l-t... (INTERJECTION). 6 162 7 8 A. R-e-i-s-e-n. 163 9 10 Q. is that one word? A. Yes. 164 11 12 Q. Yes? Q. R-e-i-S. ..(INTERJECTION) ? A. R-e-i-s-e-n. 165 Q. Weltreisen. 13 from Extern Travel? 14 A. I think it was tapering off in Liechtenstein at that 15 16 stage. 166 17 18 Q. Yes? A. And there were very little commissions paid. 167 19 20 This company also then got commissions Q. Yes. However, any way you did get commissions? A. Yes. 168 Q. Finally, the third step in this thing, was that both 21 of these establishments transferred their entire 22 funds to this entity TAWA? 23 24 A. Correct. 169 Q. When you say they transferred their entire funds, 25 where they wound up, or whatever is done in 26 Liechtenstein with companies, at that stage? 27 that the end of them? 28 29 A. Certainly the first one I think went into liquidation. Was r * 1 170 2 3 A. NOW, again...(INTERJECTION). 171 4 5 Q. Yes? Q. You are hazy? A. I am going back. 172 6 Q. Just as best you can remember? A. I think in 1984, my note states that, it went into 7 8 liquidation. 173 .9 cxC Q. This is Weltreisen? A. Reisen Weltweit. 174 11 Q. Yes? A. And the other one, Weltreisen, was formed in 1984 12 and I think it continued to 1994 when everything was 13 probably abandoned, might be a better word. 14 know whether they were liquidated. 15 175 Q. Weltreisen was founded when the other one was 16 liquidated? 17 18 Don't A. Yes. 176 Q. ;) I see. That was transferred, you say, to TAWA, ■.. .A foundation set up in Liechtenstein." 20 21 is a foundation like a trust? 22 A. Yes, a foundation -- its a family foundation and its 23 practically the same as a discretionary family trust 24 here in Ireland. 25 177 Q. Yes. I want to ask you some questions about that in 26 the light of what you said about the statements on 27 A/A38. **8 29 This discretionary foundation "TAWA"? A. 178 Q. Yes. Received the entire funds of Reisen Weltweit and 1 Weltreisen? 2 3 179 4 5 180 A. That is right. Q. When it was set up? A. Yes. Q. Do you have the date when that happened? during the 1980's? 6 7 8 You say 181 A. 1 don't have the date, no. Q. You just said to me that in 1984 Reisen Weltweit was % wound up or liquidated? 11 182 A. Well...(INTERJECTION). Q. Did it transfer the fund to Weltreisen at that stage? 12 A. 13 this. 14 15 183 16 Q. Yes? A. I would imagine it would be 1984/85 that there would be...(INTERJECTION). 17 18 20 I would imagine and, you know, we can probably check 184 185 Q. The TAWA? A. The funds would have been transferred. Q. Do you have, I am not asking you to produce them 21 now, documents relating to the setting up of this 22 foundation? 23 24 186 25 26 187 27 2P 29 188 A. I have no documents with regard... (INTERJECTION). Q. Has Mrs. Doyle? A. No. Q. Where would such documents be? A. They would be in Liechtenstein. Q. In Liechtenstein? A. Yes. . 189 Q. I see. This, what we will call for convenience "a 2 discretionary trust", was set up in Liechtenstein in 3 or around 1984? * A. 4 5 190 6 Yes. . Q. And to it were transferred... (INTERJECTION) ? A. I think it was. I think my note here was that it *v. was formed in 1984. 7 8 191 . Q. Right. To it were transferred the funds held by either Weltreisen alone or both of than together? ti 11 192 12 . 13 A. Yes. . ' Q. However, certainly all the fund that had been held in that? A. All funds went into TAWA. Q. All the funds went into TAMA. That was the 15 settlement made on the Trust. They were — this 16 became the trust funds? 14 193 17 18 20 194 195 A. Yes. Q. is that correct? A. Yes. Q. Can you tell me who the beneficiaries of that trust 21 ’* were? 22 23 . 196 24 A. I am not absolutely sure who the beneficiaries were. Q. Have you any idea? A. I honestly don't know.1 I know that they were 25 controlled, the foundation "TAWA" was controlled, by 26 a council. 27 197 2« 29 . Q. By a council? A. And this is the way they work it in Liechtenstein, by a council who had, believe it or not, authority i 2 over the funds. 198 3 4 199 5 6 200 7 8 201 ' Q. This would be the Trustee as it were? A. Yes. Q. Yes? A. Yes, and they were Liechtenstein people. Q. Yes? A. Or...(INTERJECTION). Q. How did you get your information about that Nr. Carville? 9 10 . How do you cone, do know that much about it? A. 11 We went out last year, in January 1999, my assistant 12 Joe McKenna and myself, to find but the details. We 13 met a Dr. Santa Passo who — at Zurich Airport. We ‘ 14 didn't even_ go down to Zurich. 15 16 202 Q. . A. 17 18 203 204 21 What office was he from? A. There was a Dr. Peter Marxer. Q. How did you come in contact with this man? A. Well, he was the one that we dealt with it over the 205 Q. You would had have correspondence with him? A. I.wouldn't have corresponded but I would have meet 25 him on my visits to Liechtenstein. 206 27 28 29 He had retired from- years. 24 26 And he brought the files up. Q. 22 23 . the office at that stage down there. 19 20 Yes? 207 Q. You went there during the life time of Mr. Doyle? A. I went...(INTERJECTION). Q. In connection with TAWA? A. Yes, I did, yes. ' 26 ■■ ; • 1 208 Q. It would be possible to get documentation from this 2 gentleman in relation to the beneficiaries, would 3 it? 4 5 209 6 7 210 8 A. Well, certainly we would try and get documentation. Q. Yes? A. I am led to believe that they will give nothing. Q. You were led to believe that? A. Yes, at that, meeting he said nothing will be given but certainly we will try and get it in writing from 9 him. 10 11 211 12 13 212 Q. I see. I am not asking you at this stage to get it? A. Okay. Q. We may do so if we establish a link between this and 14 "AnBbacher” because what we are investigating is not 15 Liechtenstein? 16 A. Yes. Q. However, "Ansbacher"? A. Yes. Q. 20 The reason I'm asking you questions at all about w TAWA, and what it is and its operation and so on, is 21 because you say yourself in your statement (Exhibit 22 1) -- just moving back up that page to the 23 paragraphs above the heading TAWA? 17 213 18 L9 214 24 25 215 A. Yes. Q. A paragraph directly above it: You have talked 26 about accounts A/A38 and A/A42, which we will talk 27 about in a moment? 28 29 216 A. Yes. Q. Which you told us you have statements for? 1 2 217 A. Yes. Q. In that paragraph, the last paragraph of that part, 3 you say: "I also attach a copy of a cheque dated 9th December 1993, drawn on an account of Irish Intercontinental Bank Limited with the Royal Bank of Scotland In the sum of ST6.£162,338.64 made payable to "TAWA". This sum appears to represent the balance, as at 9th Deceiriber 1993, of the said A/A38 account." . 4 5 6 7 8 A. 9 10 218 Q. Can we look at that cheque Mr. Carville, which you 11 sent us a copy of? 12 will provide you with a copy now if you have not got 13 it (Bxhibit 2)? 14 15 219 16 17 220 18 A. I think I have it somewhere, yes. Q. It is at page 10? A. No, I have it here I think. Q. Can you tell me who signed that cheque? A. No, no. 19 20 221 Q. A. 23 222 223 27 29 Where did you get it? I. think I got a photostat copy of that cheque from the Tribunal. 25 28 . How did you come to have this cheque in the first place? 22 26 Right. Yes? I presume it was a person from Irish Intercontinental Bank. 21 24 Do you have it there because we 224 Q. Prom the Tribunal? A. Yes. Q. Yes? A. Yes. Q. Do you recollect this cheque being drawn on IIB's account in Bank of Scotland and made payable to 28 • ' . ' r* " /•'•>, 1 TANA? 2 not correct? 3 4 225 5 6 226 That is right, yes. Q. This is 1993? A. Yes. Q. Were you dealing with the affairs of his Estate on behalf of Mrs. Doyle at that stage? A. 8 227 11 228 13 229 16 17 Q- Right? A. He is the Trustee. Q. Sight? A. Why this was drawn was we were availing of the • 14 15 230 18 amnesty.. Q- Yes? A. At that stage. Q. Yes? A. And Terry Cooney and my assistant Joe McKenna dealt *9 O'"' 20 No. Willie Corrigan, a solicitor,'was dealing with the Estate. 9 12 He died in 1988? A. 7 10 This is after the death of Mr. Doyle, is that with gathering... (INTERJECTION) . 231 21 Q. Who is Terry Cooney, sorry? A. He is a tax consultant. He is our tax consultant 22 probably for the last ten/fifteen years from 23 Cooney & Taggart. 24 232 25 26 233 27 28 29 234 Q. Cooney & Taggart, yes. A. He dealt with the Revenue. Q. Yes? A. With regard to clearing up our tax affairs. Q. Yes. A. We had the tax people in for, I don't know, six or 29 So... (INTERJECTION) ? ; 1 Hr. Rowan will ask you some questions about the 2 Group. 3 company called IH Investments Incorporated Limited? 4 What can you tell me about that company? 5 company belonging to Mr. Doyle? 6 A. 7 8 Yes. What I want to ask you about now is a In 1981 we acquired The Normandy Inn, which was...(INTERJECTION). 458 Q. 9, You acquired, sorry?* a . The Normandy Inn Hotel in Washington. io" 459 11 A. 12 13 460 461 16 17 462 18 463 20 YeB? A. It waB 60 or...(INTERJECTION) . Q. In 19...(INTERJECTION)? A. In 1981. Q. Yes? A. 60 or 70 bedrooms. Q. Yes? _ A. And that was owned by what we called III, Irish Inns 464 . Q. it was owned by them before you bought it? A. No, no. 24 26 I think it was for two and a International. 23 25 It was a small hotel. Yes? Q. 21 22 Q. half million dollars. 14 15 was this a We formed a company Irish Inns International. 465 Q. Right? A. In December/January 1981/82 we got a lease. 27 acquired a lease on The Stratford Inn in n8 Connecticut. We A. And we formed a company, Irish Hotel Group Inc. 2 467 A. Now, on the 4th May 1981 we formed IH investments. 3 4 468 469 470 471 472 14 473 Q. A holding company? Q. it wholly owed Irish Inns International? 474 Q. And Irish Hotel Group Inc? A. Yes, yes. 475 Q. Yes. Who were the shareholders in this company? 20 A. The shareholders were: 21 They had 3,000 shares. 22 476 23 24 477 29 Q. Yes? Q. Yes? A. p. V. Doyle Hotels owned 34%, 3,400 shares. 478 27 28 Extern Travel owned 30%. A. In the company, 30%. 25 26 Was It a company? A. Yes, and...(INTERJECTION). 18 19 What was It? referred to. 16 17 Q. You then formed It. A. And it wholly owned the other two companies that I 13 15 ' A. It was a holding company and it...(INTERJECTION). n 12 Q. The Group? A. The Doyle Group, yes. 9 i^ o Q. "We" Is who? A. Well, The Doyle Group. 7 8 Q. When you say, "we formed IH Investments"? A. Yes. 5 6 Q. Yes? Q. Yes? A. And Charles Frederick owned 36%, 3,600 shares. 479 Q. who was Mr. Frederick? A. Charles Frederick. r . 1 480 2 Q. Who was he? A. Strange as it may seem, I am not too clear. It was, 3 what we presumed at the time, a nominee company that 4 Des Traynor produced, that would hold the shares in 5 trust for something that we would decide later on. 6 481 Q. I am slightly lost. You are saying that Charles Frederick was a company? 7 8 9 Wait now. 482 10 A. I am saying I don't know, believe it or not. Q. Right? A. And I know it is very difficult for even our 11 solicitors or yourselves to believe that I did not 12 know. 13 483 Q. 14 again? 15 16 484 17 18 485 19 A. I presumed it was a bank in New York. Q. You presume it was a bank? A. A bank in New York. Q. Yes? A. That held the shares in trust for whoever we wanted 20 21 However, you thought that -- just explain that to me in years to come. 486 22 Q. Namely the 36t, those shares? A. The 36%. I would have presumed that the person 23 that it was held in trust for was the Liechtenstein 24 company. 25 487 26 27 28 29 488 Q. The Liechtenstein company, TAWA, the foundation? A. Well, I think TANA was formed after that in 1985. Q. Yes? A. But a Liechtenstein company, whether it was Weltweit Reisen or one of those. 1 489 2 3 490 4 5 491 6 Q. It was either Weltreisen or Reisen Weltweit? A. Yes. Q- One of those? A. Yes. Q. Why do you presume that? A. Well, from meetings and discussions that we had at 7 the time. 8 was the presumption. .9 492 :%'o You said Mr. Traynor set up this, is that right? A. I said Mr. Traynor produced this nominee company Charles Frederick. 493 13 14 ' Q. 11 12 I don't have any record of those but that 494 Q. Charles Frederick was a nominee company? A. Yes, and...(INTERJECTION). Q. Wait now. Just like me take this step by step. 15 Mr. Traynor produced this company. 16 "produced it" what do you mean? 17 involved in the forming of IH Investments? 18 "'"\9 495 20 When you say Was Mr. Traynor A. Yes, I was about to tell you this morning. Q. Right? A. That my first acquaintance with Mr. Traynor was when 21 we had acquired The Normandy Inn and we were about 22 to acquire this other hotel within a year. 23 496 24 Q. The Stratford? A. P. V. said, "Look, we have to have some structure in 25 26 America". 497 27 28 29 498 Q. Yes? A. "And the best person to advise us is Des Traynor". Q. Yes? A. Now, I don't know whether I or — I presume P. V. 1 rang Des Traynor and said, "Look, can you help us 2 with this?" 3 499 4 Q. Yes? A. And he said, "I will be in New York on suchsuch 5 a date. 6 will get advice in America". 7 500 8 Why don't you or George come over and we Q. Yes? A. X was appointed to go over. .9 presumably in 1981. I met Des Traynor, We went to one of the big accountancy firms in America and we told them our 11 12 story. 501 13 Q. Yes? A. That we had acquired and were about to acquire 14 15 another. 502 16 17 503 18 504 20 Q. Okay? A. And what is the structure that we should get here. Q. You and Mr. Traynor went to the accountancy firm? A. Hr. Traynor and myself were the two people. Q. Right? A. And how I remember that is, it is a bit funny if you . 21 don't mind, I remember when we were, believe it or 22 not, in the toilets, and Des was a small man and he 23 turns around to me and he says, "What do you think 24 of that meeting?" 25 know, what advice?" 26 advice. 27 back and tell them here is what we suggest we do". '’S 29 I don't He said, "They have given us no Now," he says, "what we have to do is go 505 A. I said, "I am confused. Q. Right? That we form a company for each Hotel, have a 58 r 1 holding company, and they will agree and they will 2 charge you a few thousand dollars. 3 506 4 5 507 6 Q. Right? A. That is exactly what happened. Q. Right? A. And I got a bill for $5,000 for that advice, which I 7 8 refused to pay. 508 Q. 9 io 509 A. Was Nr. Traynor1s, yes. Q. His advice was that a company would be formed for 12 each hotel? 13 14 510 15 16 511 A. Any time you bought a hotel form a company. Q. Form a company? A. Yes. Q. And that you would have a holding company that would 17 wholly own those companies? 18 19 The advice essentially was Nr. Traynor's own advice? ■t 11 Right. 512 20 A. Yes, and it was..4(INTERJECTION). Q. And that holding company was IH investments? A. Yes. It was a replica of what we did in Ireland. 21 Any time we bought or built a hotel we formed a 22 company. 23 513 24 25 514 26 27 515 Burlington Hotel did it. Q. Yes? A. And we had a holding company. Q. Yes? A. P. V. Doyle Hotels Limited or whatever. Q- Right. Id Investments then owned the previous two 28 companies. It itself had as its main shareholders 29 Extern Travel, which was majority owned by the Doyle 1 family? 2 3 516 A. That is right. Q. The P. V. Doyle Hotels, which was Mr. Doyle's 4 company, is that not right? 5 6 517 A. That is right, yes. Q. Then this nominee company, which you are not quite 7 sure what it was but it was some kind of nominee 8 company, held 36% of the shares, probably in trust 9 for one of the Liechtenstein companies? 10 11 518 A. Yes. Q. Essentially all the shares were held for or on 12 behalf of the Doyle family, would that be true to 13 Bay? 14 15 519 A. I think X would have to ask Brian is that correct. Q. What do you say, Mr. Carville? 16 you think. 17 know...(INTERJECTION)? 18 19 520 20 21 521 22 Extern, yes. Q. Yes? A. Certainly because they owned the five sixths. Q. Yes? A. The Doyle family did not own P. V. Doyle Hotels. was Mr. fc Mrs. Doyle that owned that. 522 25 26 523 27 28 29 1 mean if you do not A. 23 24 I am asking you what 524 Q. Right? A. If you call than "the family". Q. Yes? A. If you cail them... (INTERJECTION) . Q- Can we say the family or members of the family? A. YeB, yes. It Yes, and for the hotel group. So we are going back to what year roughly? That would have been in the early 1950's. Did you continue on as their solicitor right through? Yes, basically, but there*were other solicitors involved in different transactions. Were you Mr. Doyle’s personal solicitor as well? I would have been, yea. Mr. Corrigan,.as you know, we wrote to you specifically in connection with the Thornhill Trust? That's right. I think you probably know there is some confusion about a couple of Thornhill Trusts that have arisen? We never had a Thornhill Trust. This is what I want to ask you, I want to ask you what it was you had. You had a Trust that had a company called Thornhill Incorporated? No, we had a Trust, that was Mr. Doyle. We had another one for Mrs. Doyle and basically Joe Charleton and myself, that was Joe Charleton the accountant of Bastow Charleton, Joe Charleton and myself were the Trustees of that Trust. Basically ■the assets of that Trust consisted of shares in Thornhill Incorporated. Can you tell me when that Trust was constituted? I have a copy of the Trust Deed. That would be great. It was back in 1965 (Exhibit 1). (SAME HANDED TO MS. MACKEY). 2 14 3 Q. Thank you very much. A. It was actually a standard form of Trust that was 4 being used at that stage for families with money 5 where the idea was that you put the assets of the 6 business or the family business into a Trust, you 7 give the equity of the company to the Trustees for 8 the children where the parents would retain the 9 preference shares which really controlled the company. 10 11 15 12 13 16 14 It was kind of a standard at that time. Q. Right. So that was 1965? A. Yes, 1965. Q. Were the shares immediately distributed at the time? A. No, no, I think there was £100 put into the company. 15 You don't mind me looking at notes of days and 16 dates? 17 17 Q. Not at all, no. A. The Trustees, as I say, were Joe Charleton and » 18 19 myself. 20 the Trust initially comprised of the £100 that was 21 put in and there was 230 ordinary shares in 22 Thornhill Incorporated and that was his contribution 23 to the Trust. 24 unlimited company. 25 18 26 Mr. Doyle was the settlor and the assets of Thornhill Incorporated was an Q. It was an unlimited company? A. Yes, it was a incorporated company, but it wasn't 27 limited. 28 the various Doyle companies. 29 19 Q. Thornhill Incorporated held the shares in In Ireland or everywhere? t 1 A. In Ireland basically, mainly through PV Doyle Hotels 2 which again held the shares in all the other 3 companies like the Skylon, the Green Isle and hotel 4 and motel enterprises. 5 20 6 7 21 Q. So Thornhill Incorporated was the umbrella company? A. Yes, was the umbrella. Q. Through Thornhill then all the Doyle companies were 8 ' owned ultimately through Thornhill? 9 A. Yes, that's right. For example when they sold on to 10 Jurys, it was Thornhill that was sold and it took 11 everything with it. 12 22 Q. 13 Yes. The shareholders in Thornhill were all the children, is that right? 14 A. No, when it started off there was just Mr. & 15 Mrs. Doyle and then shortly — sorry, I better be 16 correct — in December 1988. 17 23 Q. 18 have that written out, have you? 19 20 24 A. Yes. Q. Would it be possible to make a copy of that 21 available to us? 22 A. 23 24 25 26 27 28 29 Yes, of course. Sorry, I would have done it. In 1988 anyway 105 of the shares ...(INTERJECTION). 25 26 Mr. Corrigan, we were just thinking if you actually 27 Q. We can get it copied now actually. A. Were transferred to the five children. Q. In 1988? A. In 1988. Q. Was this before Mr. Doyle's death? A. This was before. 1 28 2 3 29 4 5 30 6 7 31 Q. He died in 1988. A. Sorry, it could have been 1986, I don't know. Q. It was before his death anyway? A. Yes, it was before his death. Q. They were distributed to all the children? A. There was 25 shares of £100 each given. Q. In the case of two of the children, Michael and 8 David, did they sell their shares prior to the sale 9 to Jurys? 10 A. They did but that was a long time later. After 11 those 25 shares each, nothing happened until about 12 two years after Vincent died and then we were 13 reorganising the matter and the shares that the 14 Trustees held were disposed of at that stage. 15 were acquired by Thornhill Incorporated, they were 16 redeemed basically for a sum of money, so that it 17 was a way of getting rid of the shares in the Trust 18 and enhancing the shares of the remaining 19 shareholders. 20 32 21 22 33 23 Q. That happened when? A. About two years after. Q. About 1990? A. I will give you the date now in a second. They (SAME 24 HANDED TO INSPECTORS). Sorry, it was 21st December 25 1988 (Exhibit 2) . 26 34 27 28 29 35 Q. Right, I see that. A. That's right, yes. Q. So this seems to have happened after his death? A. It was after his death. 8 Mr. Doyle died in 1988. ; 1 70 2 3 71 Q. T h is A. Yes. Q. W e re y o u a w a re t h a t a sum o f m oney w as t r a n s f e r r e d 4 f r o m TAWA i n t o 5 & M ahon i n 6 A. 7 8 72 Q. 9 V# fo u n d a tio n c a lle d A. 11 73 Q. 13 74 16 17 75 th o u g h t it Y ou d i d n o t know i t 76 21 b u t a g a in I ju s t was w i t h G u in n e s s & M a h o n . was i n No, it G u in n e s s M ahon Cayman w as j u s t a n a r r a n g e m e n t t h a t a p p a r e n t l y M r. T ra y n o r had s e t up . W e re y o u a w a r e o f a n y o t h e r T r u s t s D o y le o r M r s . D o y le o r t h e No. Q. E ith e r A. A n y w h e re . Q. O th e r th a n th e T ru s ts in Ir e la n d th a t Yes. Q. Y ou w e r e a w a r e o f t h a t ? A. Yes, I s e t up b y D o y le G ro u p ? o r o ff-s h o re ? A. 22 you h ave j u s t t o l d w as a w a re o f t h a t , us fo u n d a tio n ? but i t w a s n 't r e g a r d e d as a T ru s t. 77 Q. I know , 24 te ll 25 S ta te s 26 G u in n e s s lo a n s ? was b a c k in g , a b o u t and th e L ie c h te n s te in 19 23 back th e A. 18 20 L ondon t o knew t h a t t h e r e M r. 14 15 account o f A nsbacher in T r u s t ' s a c c o u n t? 10 12 I th e TAWA? A. I can it was r e g a r d e d as a f o u n d a t i o n . me a n y t h i n g a b o u t M r . IH I c om pany i n th e In v e s t m e n t s L i m i t e d ? suppose. I D o y le 's C an y o u A g a in I am n o t s u r e o f t h e 27 because d o n 't h ave th e d a te s 28 o r ig in a lly 29 Y o r k to . d e a l w i t h A m e r ic a n b o o k in g s h e o p e n e d an o f f i c e fo r in th e d a te s th in g s , B o rd F A i l t e in New and p a r t i c u l a r l y i 1 after the Burlington was opened, they started to 2 flood in and he formed a company over there called 3 P.V. Doyle Hotels. 4 they were worried that if something went wrong, they 5 could be sued in America and levied here and that € Then he changed that because the amounts would be astronomical and there was 7 trouble with the insurance company who said to 8 separate the two things. 9 external and it dealt with the.bQokings from America 10 11 to Ireland. 78 Q. 12 Had you any involvement in the establishing of that company? 13 14 So I think it became 79 15 A. No. Q. Or advising on it in any way? A. No, I think it was the insurance company who 16 originally said you should do it and then the 17 lawyers over in America dealt with it. 18 80 Q. Were you aware that IH Investments itself held a 19 deposit or an account in Guinness Mahon Cayman 20 Trust? 21 22 81 23 24 82 A. No. Q. You were not? A. No, I wouldn't have thought it was even necessary. Q. Mr. Corrigan, did you act for the Doyles during the 25 sale of Doyle's bakeries to Brennans in 1991? 26 27 28 29 83 A. Yes. Sorry, yes and no, yes basically. Q. You say yes and no? A. it was done, as far as I can remember, by a sale of shares and I wasn't involved, in that it was the 15 ' . Guinness Mahon < X r t.C . IC /« /W M -S • 22nd LondonEC3P3AJ.Tel:0t~6239333 Cables: Quhnacp, Tihw: Bfl4Q3S . August 1983 • <« J .V . Doyle to ta ls L la it e d , c/o Guinness c Mahon Lim ite d , 17 C o lla te Green, Dublin 2* Ire la n d . 1 ' ‘ . ' „ Dear S ira , - H a c o n f ir m t h a t w* a c e p r e p a r e d t o p l a c e a t y o u r d i s p o s a l a l o a n f a c i l i t y o f u p t o o n e a i l l l o n P o u n d s S t a r l i n g ( £ 1 ,0 0 0 ,0 0 0 ) ( th e " F a c i l i t y " ) to a s s i s t f in a n c e y o u r g e n e r a l w o rk in g c a p i t a l r e q u ir e m e n ts . In te re s t F a c ility th e c o s t p e rio d o ra fix e d 12 n o n t h w i l l b e c h a rg e d on th e d a ll y d e b it b a la n c e o u ts ta n d in g u n d e r th e a t t h a r a t e o f 1/2* ( o n e h a l f o f o n e p e r c e n t u n ) p e r a n n u a a b o v e to u a o f o b t a i n i n g a M a tc h in g f u n d in g d e p o a i t f o r a n l n t e r e a t f 12 n o n th a d u r a t i o n . T h is i n t a r a a t r a t a w i l l b e re v ie w e d an d a t th a en d o f e a c h s u c h 'I n t e r e s t tf c r io d f o e a f u r t h e r p e r io d o f a. T he l n t e r e a t w i l l b e c a lc u la te d o n th e b a s i s o f a 355 d a y y e a r an d w i l l be p a y a b le s ix n a n th ly in a r e a a r an d o n f i n a l ra p a y n e n t. In a d d itio n you w i l l p a y t o u a th e c o a t o f o u r -M a in ta in in g L iq u id A s s e t s / S t e r l i n g D e p o s its w • a r e q u e s t e d b y t h a B an k o f E n g la n d a n d /o r o t h e r G o v e rn m e n ta l A g en cy fro m f h w to . t i n e , in s o f a r a a th e y r a l a t e t o t h a - F a c i l i t y . Such a d d itio n a l c o a t s w i l l b e p a y a b le b y y o u o n t h e s a n e d a t e a a s th e a fo re a e n fc io n e d * ’ in te re s t. ' ' T ha F a c i l i t y , w h ic h , la - r a p a y a b le o n o u r J a a a n d « t a n y t i n e , w i l l b e r e p a y a b l e I n a n y a v a n t t h r e e (4 ) y e a r s fro m i n i t i a l d ra w d o w n , w h ic h d ra w d o w n m u s t b e i n f u l l a n d i n o n e a a o u n t . S h o u ld y o u p re p a y th e F a c i l i t y ( o t h a r t h a n o n o u r d e a a r td ) y o u w i l l p a y c o u a t h e c o a t ( i f o f o u r b re a k in g o u r c o rre s p o n d in g fu n d in g g f & o s lt. _ . any}- • As a c o n tin u in g s e c u r i t y f o th a u n c o n d itio n a l g u a r a n te e a c c e p ta b le to u a . In th ia e n c lo s in g a co p y o f t h i s ’l e Tha F a c i l i t y s e c u rity w ill and our r y o u r o b lig a tio n s h e re u n d e r we s h a l l re q u ire o f G u in n e s s c M ahon L im i te d , in a fo rm r e s p e c t we h a v e to d a y w r i t t e n t o t h i n , tte r. ' be a v a ila b le h a v in g to you upon r e c e ip t by us o f re c e iv e d th e th e . a fa rM e n tio n e d fo llo w in g ? I) Bank Mandate and Sp*ci»wn s ig n a t u r e s I n str u c tin g u s In the o p era tio n •o f th e F a c i l i t y . " 2) O rig in a ls (or c e rtif ie d true copies) o f your up-to-date Memorandum ( and K rtlc lo s af A*anclarl>vi together with your. C e i'tific d t* o f Incorporation. . G u in n e s s M a h o n 3) C a r t if ia d pan oe * Sa ao lutio n o f your Board o f O ira c to ra confirm ing voar K c v t u c t o f t in k t n i ind co n d itio n * o f t in F i o l l l t f 'and a u th o ria l!* an o f f ic a r to andoraa tha attached copy o f th la l a t t a r . I f y o u a r e In a g r a a a a n t w ith th a f o w jo io s t o n * an d o o n d ltlo n a p l u w s i g n a n d n t u r n t o us (La a c c o r d a n c e with t h a a f o r a a a n t l o n a d B o a r d KtioXution) tht anclirmt copy of thii Ittttt tosttkic with tht otbit i ^ .V I ta s ra q jw a ta d offer o f th a ta a c a in ‘ » flth in 31 F a c ility w ill to th a hava d a ta h a rao f, la p a a d . o th a rw ia a • Va ara plaaaad to ba o f aaaiatanoa to you in t h ia raapaot. Toura faithfully, foe OTHWKSS MAHON & 0 0 . LIM ITED. D ir a c to r . % daya o r ba daaoad th la ■* * y r H*f \* • X‘ J A , >^ r r* . • r.;? 5l 7a' ' l ‘ ^ } < « „„ j 5 f , ^ r t - ‘) . ' f r ; " i > ^ , J J ^ ~ - , * 4 4 ! iiiirv ^ L cf -749 .li"« X rt ,<-.>„ ,».} >‘ ’ ", ■*» v K f >• ' W '■'* < **** rc£ / * ’ l(v ' > ^ / «■ * “ *•» ' * '‘S» ‘ , \ -‘,'1 ' ' ■ 'v- , ■ N r I/' - , '^ ’V * V . . r l ' J t * ’• ’ ■ + ‘ . u r * * * , . * \^> , • lyv ~vv I >,< K It '~ V v < *.»-^ f ’ V >“ *■ m A , v.....'■'[ ■■• -t■, i 11, '”.' K'k «. I '! \ , *«• U ’ X‘ \ ' *ll :/*" • - *•* *'*.'* ••«•■*,.- "•r i.•>* '55'.vV iS 1 *-, >> • "I ~\ - / ¥ , ' - r ' (,* < j /jT r 4/ . • - ; G'is : ^ - 'r ^ - * '< -r- - • ' 'n >3667 HARS EI - ,84033 GUIMAN € :8TH AUGUST 1987 0 GUINNESS'MAHON DUBLIN TT PAT O'OWYER COPY TO HICHAEL PENDER ROM GUINNESS. MAHON LONDON E P.V. OOYLE HOTELS LOAN FACILITY OF PD8 1 MILLION TO RECENT DISCUSSION? CONCERNING THE ABOVE FACILITY (WHICH XPIRED 24/8/87) UNDERSTAND THAT BORROWER W I8HES FACILITY TO BE ENEWED FOR A FURtHER P E R I O D . . . * N ORDER THAT NECESSARY FORMALITIES FOR RENEWAL CAN BE COMPLETE!) TO INCLUDE CREDIT COMMITTEE) HE MOULD BE 6RATEFUL IF YOU COULD DO OLLOWING*. . CONFIRM THAT BORROWER WISHES FACILITY TO BE RENEWED FOR A FURTHER PERIOD OF ONE YEAR* AND ■ *' * • > . . . PROVIDE US WITH BRIEF DESCRIPTION OF THE BORROWER AND BACK GROUND TO FACILITY. . . • WHIL8T THE FACILITY HA8 OF COURSE BEEN IN EX18TENCE 8 INCE 1983 IT WOULD BE OF GREAT HELP IN PREPARING CREOIT COMMITTEE PROPOSAL TO , HAVE SOME BACKGROUND INFORMATION. OUR FILES HAVE NO DETAILS IICH *•WOULD ASSIST IN THI8 RESPECT. • • M E 2 H A V E ABOVE INFORMATION WE WILL ATTEND TO RENEWAL FORMALITIES 3U2CKLY AS POSSIBLE. * * , to iST REGARDS > tVID HUGE8/T0NY ADLARD • ' >D 1A>09 28.8.87 ig n o isa9-2Boa-ai 4 0 3 3 6UIMAN G* '667 MARS El / ’ • / / . c -rElVE FROW $= S i S IM M s e p - 01 6 . 1 I w - ° FRXU * U VXA 19 to w n N M itd K Z s m ir; u as . tnauLpAz DUBLIN 3 . 2na S e p te m b e r , 1 9 8 7 . P. 0'Dwyer, Esq.r Guinness + Mahon Limited, 17 Collage Green, DOBLIN a. He: P.V. Doyle Hotels Loan Facility Cninneaa Mahon * Co. Dear Pat, /**"' Shank you for your eommunie*tion advising me of the reqolrwonta Indiestied to yot» by Guinneaa Mahon A Co • I would not wish to burden them with lota of work and as aueh I auggeat that X ahould make arrangements to have the business pieced elsewhere, which 1 will do on my return from halidaya and auggeat that the timing might best be « 30tb September. Would you please advise London of the poaition and aak them to make aure that they adviae Mr. David Hughes. Needleao to remark^ the Deposit will be uplifted mh the same time that the loen.ia repaid. Xoura sineoraly, ' J.D. Travno*^ P.S. Would you please peas a copy of this to Mr* Michael Pender* i67 M A R S E l (■033 6U I M A N 6 10 MARCH *?aa GUINNESS H A H O N DUBLIN TN HR. COL.LERY 6UINNESS MAHON LON DCN » »V OOYv.5 H O T E L S LOAM FACILITY PNDS 1 MILLION ADVISE T H A T INTE R E S T ON THE ABOVE LOAN FOR T HE PERIOD 24 AUGUST 87 TO 23 F c 8 » ‘ ^ARY 1988 AMOUNTING TO »»ND8 57i261.99 BECAME OUE FOR IVMPwT O N 2 3 ?SSS*1A*»Y '.9«8. • AU”~0*:S* ti? a v “ STSO. “SLcX to 0E 8IT your pnos C/A 1 OR ? ;s VAMIP yeaRyARY '••988. K'ERES" ON G * CAYMAN SLOCKED DEPOSIT A/C BE* PVO FOR T H E SAME ftlOO A M O U N T S t o PNOS 32*873.00 CREOIT. THIS SU« WILL B E RELEASED ‘YOU VALUc 23 F E B R U A R Y 1988 0 *J RECEIPT OF L O A N INTERE8T. iSAROS EDIT ADWIN 19 12«*8 2 . 3 . 8 8 NO 2 9 4 3 - 0 2 0 3 - 0 1 ^G35 6 U I M A N 8* k < 7 MARS El ' • • . 1 ■ ■ ■ ® "!"T ■ £Sterihw 863.01 22nd. Angnst 1983 HalfYear to Feb.*84 31336.16 30,797,93 HalfYear to Aug.*84 HatfYeartoFeb.’SS 37,34X47 36,407.33 HalfYear to Aaf.'SS 5&J2MJ23 HrifYear to Fdn*86 37,963.75 HalfYear to Ang.*86 S3JS33.96 HalfYear to Feb.*S7 . 52^67.81 HalfYear to Ang.CT 37,261.99 HalfYear to Fd>.*88 37,027.40 HalfYear to Aug.*88 38,691.78 HalfYear to Pth-TO • HalfYear to Ang.*89 69,73439 73,80L37 HalfYear to Kb.*90 ' 79,423.27 HalfYear to Aqg.*90 80.462J3 HalfYear to Feb.?! 67.038JZ2 HalfYear to Ang.*91 38,917.81 HalfYear to F eb .^ . . •• 33.784.23 HalfYear to Aag^92 681.936.63 Accounts Period y/e 31/7/84 y/e 31/7/13 y/e 31/7/86 yhzmnn y/e 31/7/88 y/e 31/7/89 y/e 31/7/90 J* 31/1/91 y/« 31/1/92 y/e 31/1/93 417.449.35 Notes . The&niL waa drawn down on the 22adAngnst 1983 and lodged to the account of P. V. DcgpteBolds Ltd. with the Bank atbelaud it CHjrOffice, Unban! S t, London BC3, aa per statanw t dated 24th. August 1983 ( copy attached) The Loan was with Guinness Mahon & Co. Lhnitad, London as per the statement dated 23rd Ptefarniy 198V copy attached). The address shown fcr P. V.Dorjte HotelsLtd. ia do, Quinnesa&Mahon Ltd., 17,CoQege Green, D qU ipl We only hawelburbank * h iiwiiHt M B1««fgf rtriaKffpit * TheLoenwaetianatoedtoHenxyAnAacher, 1, MStre Square, LondonF.C3A.5AN. In lateAagfeaifySepLTO. We do not hare any Loan statements for this, but we do have flw statements Saca Current Account (a/c no. 1111-460112-101) which shows the receipt of certain interest payments made by us to then. We also havefour statement* fcr an account which is called a DOC Currency Advances (a/e no. 1111-460112-301) which seems to record the rollover of a £lml. debit balance. ' The interest payments, togetherwith a £2,500 halfyear fee, were drawn on a cheque book held In the office ofMr. P. V. Doyle, in the name ofDoyle London Hotels Ltd. The UK ccmqjaiy was initially baownss P. V. Doyle Hotels Ltd., and changed its name to Doyle London Hotels Ltd. on the 13th. December 1983. The Loan was eventually cleared by a transfer offtmds from Bank ofIreland, Dublin on the rw» Wnvmlw 1« PoaLiw 4 . i .. SSLi A/A3B an* A / M 2 Dear George, The position ra .above ia aa followst A/H36 Por lotbar mth Jnly 1^90 a Intexeat to 12th SoptanSer 1990 Intaraat to 30th Septeaber 1990 Balance as at 30th September 1990 > * /M 2 \ : ^ . . Tor lattor 10t.h July 1.090 IrOdged (re Back to Baok Iondon) Intaraat to 30th Aapbambar 1990 Balance aa at 30th September 1990 Youra alncerely, y JDT/AJV 8138,230.63 5,052.32 £144,314.98 R2IV7,99$.47 74,647.92 • •9.343.31 £290,987.60 Appendix XV (31) Mrs Helen Downes 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mrs Helen Downes. a) Statement of Helen D o w n e s of 8 March 2000. b) Extract of evidence given by Padraig Collery of 11 January 2000 to Ansbacher Inquiry, with list of codes showing A/A45 relating to Helen Downes. c) Statement of account of Ansbacher Cay m an Limited of 31 December 1992. d) Statement of account - Hamilton Ross of 31 January 1993. w? ?73? Statement ofHelen Downes, prepared forthe purposes ofthe Inspectors appointed by order ofthe High Court to Ansbacher (Cayman) Ltd. Re letter dated 20 January 2000 1. Inever caused to be executed a deed oftrustor otherinstrument inthe Cayman T«i«ndn or elsewhere whereby the Company or some otherperson associated with it,or acting as itsdiscretion was a trustee or managed the trust and I never transferred money or other assetsto any such trust. 2. Ihave never caused to be established in the Cayman Islands a body corporate to which money or other assetswas or were assigned and which were managed by the Company orby any otherperson associatedwith itoractingatitsdiscretion. 3. Inever borrowed orutilisedfunds inthe Company or any “back toback” basis or on any basis, 4. Although Iwas awarethatthefundswere deposited offshore,Inever consideredwhether or not Iwas breaching Exchange Control regulations. No one ever told me and no one ever asked me. . 5. Iwas never concernedwith orinvolved inany Channel Islandstrustsor companies. 6. As far as I am aware, my money was deposited through Guinness & Mahon by Mr. Traynor whenever Irequiredwithdrawals, IaskedMr. Collery. 7. I never received a statement and only on a few rare occasions did I enquire as to the standing ofmy deposit. Iremember on the last occasion thinking thatthe ratewas very low. ~a Hry HelenDownes 8 March 2000 15 254 Q. Is this A. Yes. X / K X X X a former Kxxx 16 17 The next list of accounts are accounts that I 18 was unable at the particular time to identify as to 19 who the beneficial owners was. =20 closed over the period. 21 perhaps, maybe on some more details on individuals 22 out of that. 23 small account within the Bureau system as such, so 24 that relates to his account, I believe an individual 25 relationship. will come back to you, and • 26 255 Q. Is this A. That is correct. Some of than had had a % who was the 27 28 29 Mrs. H. Downes, I believe does not have a trust, I think it is an individual account. 59 Schedule o f Entities and Persons to the best of my recollection and knowledge at this time in accordance with the information required in the Schedule Section 1.2 4 17 H Downes - A/A 45 ■M awamyfiiaKwwwwn ’’Sr W .SBA C H ER LIMITED U f,-' 88 Jrand Cayman British West li._.aa ^ te p h O M Mo. 0—4553/4 Telex CP 305 Cable Address Guinness '' .- Xnsbocher Lim ited Cayman A/A 45 J L >0/11/92 13/12/93 13/12/92 13/12/92 13/12/92 23/12/92 23/112/92 23/12/92 23/12/92 BROUGHT PORWARD JKPAID BKLCBGED HIT AW In te ra rt to 23/12/92 ACCOUNT NUMBED 80001634 PAGE BALANCES SHOWN ARE lit rta rlin g 29 }4049.47 14130.30 0.01 14130.30 80.84 ^14130.30 31/12/92 V_______ CARRIED FORWARD •'________ / I . ■ AiwDnuncn i—iiv i11 c u \ 0 ~ e 'V3r»nd Cayman British West - f e lt. 9—4853/4 Telex CP 308 Cable Addrea* Guinness A/A43 J L. 55/01* >4/01/93 15/01/93 a/01/93 B/01/93 U/01/93 a/01/93 1 .00 23/12/93 23/01/93 25/01/93 25/01/93 25/01/93 25/01/93 _________ M IB B ST SEV B U M HBPAXD • EBLODGKD In te re st to 25/01/93 1*130.30 14219.73 65.04 14219.73 Jl/01/93 V_______ ACCOUNTNUMBS* 80001634 pAQE BALANCH SHOWN ARE DC s te rlin g CAMMED FOBWARO Appendix XV (32) Mr James Durkin 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James Durkin. a) Letter o f 31 October 2000 from Michael Durkin to Inspectors.. b) Letter o f 11 August 1992 from Ansbacher Limited to IIB. c) Letter of 11 February 1993 from Hamilton Ross to IIB. d) Letter o f 12 September 1994 from Hamilton Ross to IIB. . 43a NapsburyLane. StAlbans Hertfordshire AL11DU England The HonourableMrJustice Dedan Costello & Ms Noreen Mackey&MrPaul Rowan 3* Floor TridentHouse Blackrock CoDublin . Ireland DearSirs/Madam GUINNESSMAHON,DUBLIN Iacknowledgereceiptofyourletterdated19October?000 withenclosures. Ialso confirmthatIhave now becomeawareftatyouwrotea letterinsirdartennsInJune2000tomyfattier, James Durkinof2 Bernard Road, Worthing, WSussex. Iwishto respondon behalfofbothofus to yourletteras foliows: 1. Myfetheris 84yearsoldandhas, overthepastseveralyearsregrettablybeen progressively suffering froma decline inhis mental capacity,which atpresentis veryconfusedinrelationto all aspects of hisSfewithbothshortandlong-termmemoryloss. When, onreceiptofyourletter, Iapproached him hewas unabletocfiscuss anymatterconcerning his investmentwithGuinness Mahonotherthanto respond to my reference to DesmondTraynorwith, Traynor, yes, ask Traynor*. Therefore, any details Igive belowarefrommyowrtpersonal recollectionormyrecollectionofwhatmyfathertold meinpreviousconcersationswithhimovertheyears sine§ he firsttoidmeofinvestmentin Guinness Mahon. Mymotheris ofsimilarageto myfatherandalso nowsuffersfromloss of mental capacity, althoughbotharesffll ableto live athomeontheirownwitha rotaofvisitsfrommyselforone ofmy two sisters, all ofwhomlive reasonablydose by. . 2. Myfatherwas bominIrelandbutcameto Englandwhenaged 14, some 70years ago. He has lived in Englandeversince, flvingupto 1954tnthe Balhamarea of London (exact address notknown); between 1954 and 1961 at Queens Road, Whitley Bay, Tyne &Wear; between 1961 and 1971 at MonkseatonDrive,WhitleyBay;from1971 to1973 atBiddickLane, Fatfield, Cop Durham; from1973 to 1983atGreenhffl Close, Copthall, Camberley, Surreyandsince 1983 atBernardRoad, Worthing, WSussex. Imyself amnow45 years old andhave lived andworkedall mylifeinEngland, as have myolderbrotherandtwooldersisters. 3. Myfather was engaged all hisworkinglife inthe construction industry, progressing over some 50 yearsfrombeinga labourerto being a seniormanager. Approximately 15years ago, myfatherfirst toldmethathehadinvestedmoneyinGuinness Mahonseveral years before. Hetold me thatatthe time he had been encouraged to do so by someone whomhe did not identify to me but whom I surmisedatthe timewas Irish. His purpose intelling methenofhis investmentwas so that Iwould goto Dublinwithhimtosign a documentthatwouldmake me atrustee/nomineeof his investment in Guinness Mahoninthe event of his death, as requested byGuinness Mahon. Myfather’s intention, as expressed to me atthattime, was that his investmentwithGuinness Mahon was to “putsomething by*forhis fourchildren. Iwentto Dublinwithmy.fatheras he requested and the two of us met "MrTraynor*atan office block in Dublin city, which Iassume was the Guinness Mahonbankpremises, and Isigned a documentproducedto me by MrTraynor, butIwas not given a copy of what Isigned. This was the first and onlytime Imet MrTraynor, whomIrecollect was a personable manwho seemed sompetentin financial matters; andthat myfatherand Iboth left our meetingwithimfeelingconfidentthatmyfather’s investment was secure and growing. Boththen and subsequently, my understanding and, I believe, my father's understanding, was that my father's investmentwaswithGuinnessMahoninDubin andthatGuinnessMahon charged and administration fee for their services, calculated as a percentage ofthe total investmentat the end of each annual period. Thatwas the endofmyinvolvementwiththe investmentforseveral more years. 4. Aboutsixyears ago, myfatherspoke to me again abouttheinvestmentandwas somewhatagitated aboutit, having apparentlybeen telephoned by someone in GuinnessMahon. Again, he asked me togoto Dubinwithhim,whichIid, andwemetwithtwo men, whose names Icannotrecall, who told usthatMrTraynorhaddiedsome monthspreviously andthattheywere nowmanaging myfather's investment Irecollecttheirtalking about‘makingchangesthatpossiblywould make more money”, whichmademepersonalyapprehensiveonmyfather’s behalf. Inthe monthsfollowingthatmeeting, I soughtto persuade myfatherto move his investmentto another bank. Eventually, afteraboutsix months, mylatheragreedandthethen value of his investmentwas transferredby Guinness Mahon, intwo tranches as Irecollect to another bank, where Iamat presenta trustee/nominee. 5. My father does rat appear at present to have any documents relating to his Guinness Mahon investment I do not recollect ever having seen any documents or statements relating to the investmentandmyunderstandingfrompreviouswasthatcommunications byGuinness Mahonwith myfathertendedto be bytelephone ratherthan inwriting: 6. Inconclusion, Iwishtoreiteratethatmyfather’s capacityto helpyou atthis timeis extremely limited. He is certainly not in a position to travel to Irelandto meet with you, but if you wish, you or your representativemayvisithimathishome, inmypresence, inorderto satisfy yourselves as to what he canrecaH. Alternatively, ifthere are specific documents on which youwish meto comment, orwish meto put before myfather, IconfirmthatIwouldbe wi^ng to do so. Yoursfaithfully ______ MdtaalDuikh Please reply to: P.O. Bos 117, Grand Caynan, Cayman Islands, British West Indies Tdaphdne (109) 9494655 Tttax: CP 4305 42 Fhzwffliam Square, Dublin 2. Tel: 765144/763065 Fix: 612033 ' Fscsbnile (809) 949-7946 (809) 949-5267 11th August, 1992. Ronan Redmond, Esq.r . Corporate Services, Irish Intercontinental Bank Limited, 91 Herr ion Square, DPBLIN 2. Dear Ronan, Could you pleas* arrange to let me have for collection on Friday morning please, 14th August, two Sterling cheques as follow: (1) Payable to James Durkin for Stg.£2,000 (2) Payable to Michael Durkin for Stg.£2,500 Please debit both amounts to Ansbacher Limited Account No. 02/01087./B1. ounwsn. MONACOANDSWRBKANa - P.O. Bo* wrc. Grand Cayman. Cayman Ulan*. Brltlah West Indie* . Telephone: (SOW 9494M35 Telex: CP 4305 Facsimile (800)949-7946. (809) 949-5267 Please reply to: 42 FitzwflUam Square, Dublin2. TO: 763144/763065 Pax: 612035 11th February, 1993. Sonan Radraond, Baq. »' Corporate Servicas, . * Irish Intercontinental Bank Limited, 91 Marriott Square, DUBLIN 2. . pear Ronan* - . . Could you please arrange to let me have for oollaotion a Starling oheque for Stg.*2,000.00 payable to J. Durkin and debit tha coat to Hamilton Roaa Account No.02/01354/81. • . * Yours sincerely, <~ >or mmXLTOH BOSS CO. LIMITED O ' - DPC - Fleas* debit A/A8. ' Ponds from A/A11 will be . transferred to A/A8 at maturity of A/A11. i• JDT/AJW n M&Daire Nolan-Caasidy, Corporate Services, Hsh Intercontinental BankLimited, 91MsrrioaSquan^ 12th September, 1994. DUBLIN 2. .»t* * ;.v ! *■ .- DearDaire, Could you please arrange to let us hew for collecdoa as soon at penfbie * Staring cheque fer StgJ4*OOO.Q0payableto Guinness ft Mahon United and debit the cost to Hamilton Ross Account No.02/01354/81. i ! I \ Aa this is required urgently your assistance would be nmcb appreciated. Many thanks. Yours sincerely, • ' :• • f For ; i •j . * i .. : ** 9 TnNrftQSS CO. LIMITED. /AJW DPC -J.Durkta requires Stg.£4,000 in cash. G. &M. have agreed to handle for me and will advise the cost element in doe course. This phis the extra in due course should be debited to A/AS. C lxQ yM rt& L - ^ocL^uat* l o 6C.t-cCur -A / ^ ^ Appendix XV (33) Mr James Sidney East, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James Sidney East. a) Letter o f 18 August 1971 from Kennedy Crowley & Associates to Mr John Ronan. b) Letter o f 8 March 1972 from Kennedy Crowley & Associates to GC Crampton. c) Guinness and Mahon Board Meeting Agenda & internal Guinness and Mahon memo re new/increased loans o f 28 Novem ber 1974. d) Extract o f transcript o f evidence o f Mr George Crampton given to the Inspectors on 8 February 2000. 7 . I , • Kennedy Crowley &Co. Chartered Accountants Hainault House 69/71St Stephen’s Green Dublin 2 Telephone 757971 John Ronan, Esq., W. Ronan & Sons, urf. ■ . Ker DTR/A 94/95 South Mall, Cor^' D « e :18 August 1971 re: Cayman lalanda Truat Saar John, - ' * 7.n the couraa of diaeuaalona Which I had on Friday with Kaaara. ' Gaorga Cranpton and I was aaked to writs to you . asking you to adviaa than and Messrs. 8. Clarke, 8. Seymour, j. Sldnay Bast and i. Webb regarding tha aatabliabaent of diaerationary tznata in the caynan Islands. 1 had already seat yon for general lnfoncation a draft of a trust dead which Is used in tha Caynan lalanda end tha •hove nased would like you to adviaa than aa a group on the suitability of such a truat deed for their purposes hut at a later stage ’-eferesss will of course he naesssas; lo the individual requirements of each. In the first Instance they sould wish to have written advice and at a later atage they would like to discuss this written advice with you on aone aultable occasion when you are In town. As you know from your other connections these trusts will be tbs recipients ultimately of certain tax free profIta In the Cayaan Islanda and the anxiety la that tha arrangements should he as flexible sa possible, consistent with the continuing tax free atatua of the truat and of appointments made by the trustees to the beneflciarlaa of the truat. I have already given you some consent on the general features of the trust deed and If you feel a further discussion would be helpful please let ne know. . Z an aending a copy of this letter to Ur. C. C. Crampton. Tours sincerely, . D. Said Martin Ctw.V VCA lidgar Kwnifr R'A C iH M u lu u t D r c h n CkIKim A t ’A K tlw a n l Iuv C>hi F C A IV i» n O 'C o m w ir A C .\ Cirrakl Conor CruwU-v VCA la m r c iiiY Crnwlry K ’A NUB Cnnvkv K( IV illratwK»U"y H ‘A I Xivul K n u r W A A le x S jw m K t’A . W W f c r KCA 1‘ritKifol M am pm S’iwnuii Bak I'tUT l.jurli >M IWill Hainauh House fid/71 St Stephen's Green Dublin fi Telephone 757971 Q.C. C r o p ton, Kaq., 9» Hapla load, Dublin 14. . Ra: l**f: BR/GC Jm b j 8eh March, 1972 C a w a Tn«t». Daar Mr Craapton, Z aa aorry that It baa takan * a ratter longar to coma back to you with tha draft Lettar of Wlahaa. X aa no* anclcaing ilx eoplaa of thla draft ao that It nay ba conaldarad by aaeh of tba indlviduala concarnad. X think that tha t ana of tha lattar ara fairly aalf-axplanafcory and atumid not giva riaa to any probtaaa but, ahould anyona alah to diaenaa than with aa I would ba happy to do ao. Slnca x aaw you «a hara aaat to tha Cayman Xalanda tha raviaad draft Truat Dacd, togathar aith tha datall -i required to eoaplata tha appolntad elaaa In each caaa. ^ For oaaa of rafareaee, and to avoid too much identification, «• ara aamtng .tha Truata tha Whitethorn Truat a. Tour « w will ba tha Whitethorn A Truat, Mr Clark1a tha Whitethorn B Truat, Mr Baat’ a tha Whltathorn C Truat, Mr Sayanur'a tha Vhitathorn X Truat, and Mr Wabb'a tha Whltathorn V. Truat. ■ Aa aoon aa tha Truata ara d r a m up x will hare tha Lattar of Wlahaa algnad in aach caaa by Paul Barria -who la tha aattlor. Two foxaal atapa will than ramain to ba takan. Tha firat la tha formation by tha Truataaa of a company (or coapaniea) to raealya in coma from dapoaita or invaataanta on bahalf of tha Truataaa. Tha aaeond will bo tha execution by Paul Barria of a Dead (in blank) aaalgnlng hia powara aa Appointor of tha Truata. Toura alncaraly, in Raid 2nd a. ^fnrtiit■.rot^lVA IW fc m V titUiu: OmtrCftiv 1j i j r - w IVmnjctlM.uunrrnt K d jr a r K ir u » * r * Y A \ \ m w U -v H ’ V NkiIHWvIih IV \ WgHai:i«**»kvVTA KiiHimtI'MvjfmKr.t iVhn OVmuiur MW DnMlUwwFl*' Al*\ S W«i YiW t t r m k l V M u i ' k ? Kv*A N iv iib u i %ih* IWr l.vnrl* 11 (nrti 1 'id P.S. Z abould MaClon that In *ach caa« tha aattlor would b« a Cajnnan Xalaoda raaidant and the appointor would b« tha appropriate Individual naaad above. GUiaKUSS fc MAHCW LTD. HEBT1HC OF HOARD O f DTUECTOUS 2CI.li rtOVlOMlJK»; 1:V /4. 000534 . KL t&Tts" AGENDA Minutes of Board Meetings held on 26th September 1974 and 17th October, 1974. Management Report covering the period 1st September to 31st October 1974. Any other business. I W H I* m i K w m o t H / l M W u H ■!■«» U r t Cuato— r S ld n t y i M t U»l* 5 ,0 0 0 U . . IBMraai _s»is— .totiMt xa s.oaa C o— * n t A d d i t i o n a l Io n dll o f < 1 ,0 0 0 U k « a up s u ita b ly n e u t t p o s it io n . 7 236 Q. I would like, Mr. Crampton, if we could go through 8 briefly the last set of documents you gave us, which 9 w e got yesterday (SAMB handed to n r . CRAMPTON). 10 Yes, this might be a good time to — 11 now, Mr. Crampton, and you might like to look at 12 these documents X want to go through with you. 13 will break for ten or fifteen minutes. 14 A. we will break We All right. 15 s h o r t A p jo m a n c p rr 16 17 18 237. Q. MR. JUSTICE COSTHLLOi Mr. Crampton, we will 19 continue then, look at this file of documents that you gave us 20 21. yesterday? 22 23 would you 238 A. Yes. Q. I think it is document No. 10 of 8t h March 1972. 24 That is from Kennedy Crowley telling you h o w the 25 Trusts, were going to be set up. 26 there were to be six Trusts set up, Exhibit 1? 27 28 29 a 23 9 . Yes. Q. Do you see that? A. Yes. Do you see that 1 2 3 240 A. Correct. 241 4 5 Q. Were these Trusts set up, do you know? A. That, I do not know. 242 Q. I do not know? A. No. 6 7 Q. Were these fellow Directors of yours? 243 Q. You have not talked to your fellow Directors at all about this? 8 A. There is only one alive at moment. 9 10 244 Q. who is that? 11 12 A. 245 Q. 13 - 14 A. Correct. 246 Q. Is it your recollection that you did not talk to any 15 of them after this financial arrangement was made? 16 17 A. I understood that there were ... (INTERJECTION) . 247 18 Q. You understood that they were all set up? . A. Yes, but I could not confirm that. 19 20 . 1 understood there were six trusts. 248 Q. Do you know whether any of them had Ansbacher 21 accounts such as you had or Guinness & Mahon 22 accounts such as you had in Dublin? 23 24 A. z am sure they had. 249 25 26 Q. You are sure they had? a 250 Q. in other words, you think they carried on the same 27 way as you carried on? 28 29 . They probably had, yes. a 251 . They might, but not for as long. Q. Not for as long? . Appendix XV (34) Mr Francis Augustine Eastwood 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Francis Augustine Eastwood. a) Letter of 9 August 2001 from Sheehan & Company to Solicitor to the Inspectors enclosing unsworn statement of Mr Ronan Eastwood. b) Letter of 30 April 1991 from Ansbacher Limited to IIB. c) Letter of 15 August 1991 from Ansbacher Limited to IIB. d) Letter of 5 April 1993 from Cayman International Bank & Trust Company to IIB. e) Telefax of 15 March 1994 from Cayman International Bank & Trust Company to IIB. f) Telefax of 15 November 1994 from Cayman International Bank & Trust Company to IIB. S h eeh an & C o m pany S O L I C I T O R S I CLAUS STRH8T D U BLIN 2. T JL E PH O N E 01 T B L SP A X DJ 64I0D1J, O .D .I. 161 OUK VO«* »BKt RIP; JPS/MC ‘ Maty Cummins Solicitor to the Inspectors 3rd Floor Trident House Blackrock • Co. Dublin R e: DATS: O u r C lien t: Dear Sits, 9* August 2001 . ‘J/Jr* • Ellen E astw ood . Further to your recent letter, w e apologise for the delay in dealing with this matter. We enclose unsworn statement o f Mr. Ranan Eastwood, son o f Mrs. Ellen Eastwood, who has effectively being handling this matter on his mother's behalf. /- v Mr. Eastwood is one o f IS children o f die late Mr. Augustine Eastwood and is prepared to attend before you to give whatever evidence he can in relation to the matter. None o f his brothers or sisters are familiar with the details and his mother, who is an elderly lady and residing in Belfast is also unfamiliar with the detail o f the matter. Neither sheor any o f her family were aware o f the existence o f fhe relationship between her late husband and Ansbacher Cayman Limited until it was referred to in an article in the Sunday Independent sometime ago. 'MoMs faithfully, SIrananl& Company JEREMIAH SHEEHAN B A. DAVID C. COLBERT B.A.. L I.II. GKAI.V*e AHER.V a.C.t.. St KI. FEBOLJOS D.L.S.. DOLORES O'KEEFPF. S C I . . UNSWORN STATEMENT OF RONAN EASTWOOD, son o f the late Augustine Eastwood. I am the son of the late Francis Augustine Eastwood o f528 Antrim Road, Belfast. My father died on the 7* of January 1999. My mother, Ellen Eastwood is still alive, aged 77. However, she has no direct knowledge of die matter, die subject of your enquiry, and was totally unaware of my late father’s dealings with Ansbacher (Caymen) Limited (ACL) during his life time. I am one of IS children and I am satisfied that none o f us whatsoever were aware of my father’s dealings with ACL. . . The first time I became aware of die matter was when I read an article in the Sunday Independent which named my father as an account holder. I dun made enquiries of Mr. Padraig Collery who confirmed the position suggested that I contact ACL directly to ascertain die facts in more detail. - ' Since July 20001 have worked in conjunction with my Solicitor, Mr. Jerry Sheehan, seeking foil information from ACL in relation to my late father’s affairs. In that time we have effectively uncovered all relevant information. By way of background, my later father was a major "scrap metal" dealer in Belfiut for many yean, until he sold his yard in 1986 or thereabouts. . In 1987 he purchased a house in Drogheda - Easton House, Colpe Ctoss, Drogheda, where he and my mother lived fin circa ten years. They moved back to live in Belfast shortly before he died. I believe tlfe proceeds o f die sale of the yard were automatically deposited on three trusts in ACL. Despite months o f my Solicitor trying to obtain information from ACL between August 2000 and January 2001, both my letter and by phone, no real information was forthcoming. In January 2001 it was suggested by Mr. Bothwell, Managing Director o f ACL that my Solicitor travel to meet him (i.e. Mr. Bothwell) and the lawyers to ACL to consider die situation regarding three trusts which my late father had caused to be set up. Prior to this Mr. Collery had advised that my late father had been associated with three trusts, two of which were named the Dallas Trust and the Canton Trust respectively. He could not recall the name o f the third trust It was subsequently confirmed by Mr. Bothwell that the third trust was the Omaha Trust. My Solicitor, Mr. Sheehan, duly met with Mr. Bothwell and Mr. Kervin Glidden of ACL and also widi Mr. Andrew Jones of Maples and Calder, Attorney-At-Law representing ACL, following which meeting it was agreed that in return for my mother signing three deeds o f Indemnity, (one in respect of each Trust)(copies enclosed), the Bank would distribute the balance remaining in each Trust to my mother. This process is just now coming to a conclusion. From information which I have acquired over the past months, it seems that certain distributions were made to my father, or at his direction, to third parties-from the various Trust Funds. These were made with the assistance of Mr. Collery and I believe originated in Ireland from funds held by ACL at HQ in Merrion Square, and were made, by way o f Bankdraft. . I know that in or around 1993/1994 all 15 children in the family received a gift of £5,000 which explains a-distribution at tins time o f £75,000 from die Omaha Trust From documents made available to my Solicitor by HB, it seems that certain loans were made to my fether and third parties, die security forwhich was, from what I understand, What iJ referredto as “back to back loans” i.e. part o f die funds are held by ACL in HB on behalf o f the Trusts set up by my late Gather were set aside as security for the loans by HB to my fether and third parties at his direction. ' I enclose a booklet of documents made available by IIB in this regard. r^. To the best of my knowledge, I believe, one o f the loans was made available to my brother Francis Augustine Eastwood and another loan was made available to a Mr. Rue Leonard. It is my understanding that while my father was tax resident in the Republic o f Ireland during his occupation of die house in Drogheda, he remained domiciled in Northern Ireland. Thus during the period he had no tax liability for interest earned on die funds lodged with ACL. However, there may have been a liability in respect o f distributions made in the period if they were withdrawn from income earned as opposed to capital original deposited The latter situation appears to have been more likely. Consequently, a submission is currently bang lodged with the Revenue Commissioners. I appreciate that die above information is general in nature and to the extent that I can I am prepared to attend before you to give any further assistance possible. You have raised a number of questions in Appendix C o f your letter. The M owing are my replies on behalf of my later father’s estate, to the best o f my knowledge:- 1 a) Herewith please find all documentation in my possession in relation to the three trusts (namely, Dallas & Omaha) comprising Deeds of Trusts, Trust Accounts and various statements. There are no associated corporate bodies. b) 1989. c) None. d)i. There were no distributions from the Canton Trait. _. ii. There were distributions from the Omaha Trust between 1992-1994 only, iii There were distributions from the Dallas Trust between 1992 and 1998 ....... Details are as set out in the accounts furnished herewith. - . - - e) I.do not have this information. f) None to hand. g) Instructions were given to Mr. Padraig Collery. There are no records o f any written instructions. . 2.a) b) Most likely Mr. Desmond Traynor. . 1989 or thereabouts. See replies at Id above regarding other dates o f distributions. To the best o f my knowledge no further deposits were made. c) Only one initial lodgment seems to have been made. d) 1 believe contact was made with Mr. Collery who would make arrangements to have the monies withdrawn from IIB by Bankdraft and delivered to m y late father. The answers are similar to those at 2a-f respectively. I believe that this is not applicable. . Tt does seem that the service as referred to was availed«of. I enclose booklet o f correspondence furnished by IIB in this regard. No permission was applied for to the beat of my knowledge. - In relation to this question it is possible that the funds deposited in ACL were originally deposited with College Trustees Limited, however, this has not been confirmed. A) Most likely, Desmond Traynor. B) None available. C) Not known D) Not known - most likely Padraig Collery. B> Possibly1996-1997. F) None available. G) Ditto. H) Unaware. J) Most likely via Mr. P. Collery. A) None. B) C) None. None. D) Dallas Trust/Canton Tnist/Omaha Truat ^ - . . _ . . 27th November 1989 Da t e a :______ .. ________________ JOHN A. FUB2E Settlor ANSBACHER LIMITED Original Trustee Pr-SCKETIONARY SETTLEMENT I THIS INDENTURE OF SETTLEMENT is made the A.D. ]9 89 BETWEEN Grand Cayman, B.tf.I. one part and JOHN A. FURZE 27thday of November of Snug Harbour, P.O. Box 887, (hereinafter called "the Settlor") of the ANSBACHER LIMITED a company incorporated under the laws of the' Cayman Islands and carrying on business thereinafter (hereinafter called "the Trustee" which term shall also include any additional or successor trustee or trustees hereof) of the other part. ' WHEREAS the Settlor has caused the property described in the First Schedule hereto (which together with the money investan^ property for -the--time•■*being~representing '""1' ’" " and -and additions or diminishraents thereto, and any further property becoming subject to the' trusts hereof is hereinafter called "the Trust Fund" and shall be known as "the Omaha Trust") to be duly transferred into the name of under the control of the trusts hereinafter expressed. NOT THIS SETTLEMENT WITNESSETH as follows: 1. The Trustees shall stand possessed of the Trust and during the period commencing on the date of execution of these presents and terminating on the expiration of twenty (20) years after the death of the last survivor of the lineal descendants now living of His Late Majesty King George the Fiftli or on the eviration of seventy years from the date hereof (whichever shall be the earlier) (said period hereinafter called "the Accumulation Period” and said termination date heing herein­ after called “the Fixed Date") UPON TRUST as to investments . or property other than m o n e y e ither to permit all or any of the same to remain as i n v e s t e d for as long as the Trustees • • • shall in their absolute d i s c r e t i o n deem fit or to sell call in o r convert into mo n ey a l l o r a ny of such investments or p ro p e r t y UPON TRUST as to m o n e y including the money arising f r o m any such sale c al ling i n o r conversion as aforesaid to i n v e s t the same in or u p o n a n y of the investments hereinafter authorised. 2. . . . THE Trustees may apply or invest the Trust Fund .in the purchase of or at interest upon the security of such stocks funds shares securities options or other investments or. property whether real or _per^al^:movab^Ko ^ • nature and wherever situate (including any fractional or undivided interest, therein and including the purchase maintenance ' • •» • . or improvement of a freehold o r leasehold dwellinghouse s it u a t e anywhere in the w or l d for u s e as a residence) and whether i n v o l ­ v in g liability or n ot a n d w h e t h e r producing income or not o r u po n such personal credit w i t h o r wi thout security as the T ru s te e s in their absolute d i s c r e t i o n shall think fit with p ow e r from time to time to v a r y such investments for others of a like nature (yet. b e i n g u n d e r no duty to diversify invest­ ments) and with power t o h o l d cash funds uninvested and other non-income producing p r o p e r t y to the e xtent that the Trustees shall have the same full and unrestricted powers of investing t h e Tr u st Fund in all re s pects as if they were absolute owners beneficially entitled PR O VI D ED ho wever that in the professed . e xe c ut i on of the tr u st s and p o w e r s h e r e o f the Trustees shall n o t be liable for a n y loss to the T r u s t F un d arising b y r e a s o n . * of any i nvestments m a d e in g o o d f a i t h or by reason o f any m i s t a k e or o m i s s i o n m ad e in g o o d f.aith b y the Tr u stees or b y r e a s o n of a n y o t h e r m a t t e r or t h i n g e x c e p t wilful and i n d i v i d u a l • i fraud or w i l f u l a n d i n d i v i d u a l w r o n g - d o i n g o n the p a r t o f th e T r u s t e e s w h o are s o u g h t to b e m a d e l i a b l e w i th o u t li m iting t h e g en e ra l i t y o f the f o r e g o i n g t h e T r u s t e e s are hereby s p e c i f i c a l l y e m p o w e r e d t o m a k e i n v e s t m e n t s a n d t o a c q u i r e pr o p e r t y w i t h o u t a n y requirement o f d i v e r s i f i c a t i o n e v e n t ho ug h such i n v e s t m e n t s o r property m a y be h i g h l y s p e c u l a t i v e o r n o t of a t yp e w h i c h a r e suitable trust i n v e s t m e n t s o r h o ld i n g s . In particular the T r u s t e e s m a y m a r g i n or h y p o t h e c a t e t r u s t assets or s e c u r i t i e s . in w hole or in p a r t sell short, p u r c h a s e o r sell options, puts, c alls or o t h e r c o n t r a c t s o r s e c u r i t i e s o r commodities and c a r r y . •i o n trading a c t i v i t i e s of every t y p e w h atsoever, 3. ' TEE T r u s t e e s s h a l l have t h e p o w e r to sell lease or t • t e xc hange an d t o g r a n t o p ti o ns t o p u r c h a s e lease or e x c h a n g e a ny p r op e rt y m o v a b l e o r i m m o v a b l e . (which e xpression s h al l b e deemed a lways t o i n c l u d e any p a r t or share o f any s u c h p r o p e r t y ) • w h i c h may a t any time* c on s ti t ut e t h e w h o l e o r any p a r t of the T rust Fund e i t h e r a t public a u c t i o n or p r i v a t e sale for s u c h c o n s i d e ra ti o n and o n such terms c r e d i t or security as the Trustees m a y d e e m a d v i s a b l e and w h e t h e r for the pu r po s e of r e - i n v e s t n e n t d i s t r i b u t i o n or d i v e r s i o n and no p ur c ha s er on any sale b y the T r u s t e e s or o t h e r p e r s o n de a ling w i th the ' Trustees shall be c on c e r n e d to inquire into the propriety or validity of any act o f th e T r u s t e*•e s ' or to see to the a p p l i c a t i o n of any money :paid or p r o p e r t y transferred to or upon the o r d e r o f the Trustees. ‘ ' ' the A c c u m u l a t i o n Period the Trustees shall s t a n d possessed of the Tr u st F u n d a n d the income thereof upon the following trusts that is t o s a y : ­ ' (a) Upon trust for a l l or any to the exclusion o f th e others or other o f t h e p er s on s described in the S e c o n d Schedule hereto (being and hereinafter called "the Appointed Class") i n s u c h shares and in such m a n n e r ___ _____ _______________ ___ and provisions as the Trustees in t he i r a b s o l u t e and uncontrolled d i s c r e t i o n at any time or. ti m es b e f o r e the Fixed Date by any d e e d or deeds r e v o c ab l e- o r irrevocable without t r a n s g r e s s i n g the rule against p e r p e t u i t i e s m ay appoint and so t h a t by any such a p p o i n t m e n t the Trustees may confer u p o n any appointee any v a l i d p o w e r or powers of a pp o in t me n t in favour of any o t h e r m e m b e r of the Appointed C l a s s . AHD it is expressly p r o v i d e d (without prejudice to the , • . generality of t h e for-egoing) that the Trustees m a y appoint on d i s c r e t i o n a r y trusts and that such trusts may include as o b j e c t s o f the powers as regards i ncome of the Trust F u n d a n y m e m b e r of the Appointed Class and may dispose of the w ho l e or any part of the T r u s t Fund to the Trustees of any other Settlement (in .. j - 5 - I existence at the time o f s uc h disposition and whether in accordance with the laws of the Cayman Islands or 9 ' ' not) under which any m e m b e r of the Appointed Class is a beneficiary to be he l d as* an accretion to the Trust Fund thereof and subject to any such appointment and s o far as the same may n o t extend. (b) Upon Trust to a c c u m u l a t e any income of the Trust Fund in the way o f .c om p o u n d interest by investing the same and the resulting i n c o m e therefrom in any of' the investments h e r e i n b e f o r e authorised and adding such accumulations and r e s u l t i n g income as accretions (c) Provided always t h a t t h e Trustees in their absolute discretion may, pay or a n p l y at any time and from time to time during the A c c u m u l a t i o n Period all -or any p a r t of the income or capital o f the. Trust Fund to o r for the benefit of the m e mb e rs o f the Appointed Class and of more than one for any o n e or more to the exclusion - • of the other or others of t h e m and in such shares as the Trustees may in th e ir absolute discretion think fit, (d) Upon the ’ termination of the Trust on the Fixed Date Upon Trust as to the Balance of the Trust fund to or for the benefit of s u c h members of the Appointed Class as shall be living immediately before the Fixed Date in such shares as the Trustees shall determine and in default of such determination if more than one - 6 • " • in equal shares absolutely and subject as aforesaid the Trustees shall hold the capital and income of the Trust Fund in trust for the Grand Cayman branch of the British Red Cross Association and the receipts of the Treasurer for the time being of such Charity shall be a good discharge to the Trustees. (e) * . Any payment o r application of the Trust Fund to or for the benefit of any one or more* of the . parties hereinbefore enumerated may be made either outright or in trust for the said party or parties which trust or trusts m a y b e formed by the Trustees di tions including trusts and powers exercisable at the discretion of any person or persons as the Trustees may in their absolute discretion think fit." 5. IN addition to all the powers vested in the Trustees expressly or by implication hereunder or by law or statute the Trustees shall have all the following powers and may in their absolute discretion■ exercise all or any of the same from time . ' I ' t o time in such manner and to such extent if at all as may • * ‘ s e e m to them desirable.. (a) To receive additional property or donations by gift or will or by the provisions of any other trust or trusts or otherwise from any person or persons as additions to this Trust and as part of the Trust Fund and to hold the same upon the Trusts herein set forth and to administer such additions under the provisions hereof. . j * A (b) With respect to any property constituting the whole or part of the Trust Fund to exercise all powers which individual benefi ci a l owners might exercise without being restricted in *ny way by the office of trustee including (without prejudice to the g e n e r a l i t y of the foregoing) the following powers. (i) To .promote and incorporate companies to c a r r y on any business w h a t s o e v e r and power to liquidate t h e same and distribute their assets in specie or o t h e r - . vise. (ii) T o vote upon o r in respect of any shares securities bonds notes or other evidence bf intere s t in or obligations of any corporation trust a ssociation or concern whether or no t affecting the security o r the apparent security of any part of the Trust Fund or the purchase o r sale or lease of the assets of any such corporation trust association or concern ’ br ' and (iii) To give proxies o r powers of attorney with o r without power of substitution for voting or acting * ‘ f on behalf of the Trustees as the owners of any such property and (iv) To participate in and consent to any corporate reorganisation consolidation merger liquidation dissolution sale or lease or in and to any other change in any corporation or in its financial structure affecting any s.ecurities or other property I ■ (v) To become a p a r t y to any voting trust or deposit agreement a n d to. deposit any securities or property held h e r e u n d e r wi t h any protective ’ reorganisation o r s i m i l a r •committee or in any vo t i n g trust or with a n y d e p o s i t a r y designated thereby a nd (vi) To exercise o r c on c ur in exercising the voting and other r i g h t s attaching to any securities for the time b e i n g f o r m i n g part of the Trust F u nd so as to become a D i r e c t o r or other officer or employee of any c o m p a n y and to be entitled to vote for and to be p a i d a n d t o retain for the .Trustees * .... ........... Trustees' s e rvices. (vii) • ' To hold or d e p o s i t any securities or other property in bearer f o r m o r in the name'" of the Trustees or in the n a m e of any one of them b e in g a Trust Corporation o r in the name of some other . persons or partnership o r in the name of a duly appointed nominee w i t h o u t disclosing the fiduciary relationship and ' ’ , i ' * * (viii) To omit to r e g i s t e r bonds or securities and (ix) To keep the w h o l e or any part of the documents relating to and the m o n e y investments and property comprised in the s a i d T r u s t Fund within or without the said Cayman Islands. (c) To invest re-invest a n d manage the Trust Fund e i t h e r separately or together w i t h .other funds to acquire and retain the shares or securities of investment companies or investment trusts w h et h er of the open or closed type and without notice to anyone to participate in any common trust fund maintained'by any corporate trustee ah any (d) time serving hereunder. • To engage the s er v ic e s of an investment advisor or advisors at the e x p e n s e of the Trust FUnd and w i t h o u t liability to follow £fTe recommendations of such advisor or advisors even t hough such recommendations may- be .. highly speculative o r n o t of a type which would ordinarily be legal o r suitable trust investments. to such persons i nc l uding the members of the Appointed Class as the Trustees m a y determine to be reasonable and proper and w it h o u t limiting the generality of the foregoing to mortgage or hypothecate all or any portions o f the Trust Fund. *• (f) . kj • To make execute and deliver deeds conveyances ■ '' assignments transfers options leases mortgages instruments of pledge instruments creating liens contracts and ■ • _ other instruments s ealed or unsealed to raze or erect any buildings or other structures and to make any kind of improvements which the Trustees d e em proper. (g) Without prejudice to the jurisdiction of the Court and according to the respective rights' and interests of the persons interested to treat as income or capital or to apportion between income and capital any dividends I - stock dividends rights interest rent issued and profits derived from any p r o p e r t y at any time comprised in the Trust Fund a nd g en e rally to determine What part of the receipts of the T r u s t is income and what is capital and whether o r not such p r o p e r t y is wasting o r u n p r o d u c ­ tive or was pu r ch a se d at a premiu m- o r discount and* notwithstanding the time w h e n such dividends stock dividends rights i nt e re s t r e n t issues or profits w er e earned accrued declare!! or p a i d to make such reserves o u t of income or capital as the Trustees deem proper -for - expenses taxes a n d o t h e r liabilities of the Trust to pay from income o r from c a p i t a l or to apportion be t we e n investments and of s e lling ex c ha n gi n g or leasing including brokers' c o m m i s s io n s and charges and g e n e r a l l y to determine w ha t p a r t of the expenses of the T r u s t shall be charged to capital a n d what part to income an d to determine as between s e p a r a t e funds and separate p a r t s o r shares the a llocation of income gains profits losses and distributions. (h) To carry o n participate o r invest in any corporation •f . ■ partnership joint venture or co-operative and to enter into such leases contracts o r other undertakings relating to the Trust Fund or any p a r t of it as the Trustees shall in their uncontrolled discre ti o n deem advantageous notwithstanding that such leases contracts or under­ takings extend or may extend beyond the termination of this Trust. i I * (i) To institute p r o s e c u t e and defend any suits or actions or other p r o c e e d i n g s affecting the T ru s te e s or t h e ‘ Trust Fund o r a n y p a r t thereof to c ompromise any matters of d i f f e r e n c e or* compound any debts o w i n g to them as Trust ee s o r a n y o th e r plaims and to a d j u s t any disputes in r e l a t i o n to debts o r claims a g a i n s t t h e m as Trustees u p o n e v i d e n c e that to the T r u s t e e s * s hall seem s u f f i c i e n t ~ a n d i n whole or in part a t p u b l i c auction or private s a l e o r o t he r wi s e and upon s u c h t e r m s and for such terms as t h e T r u s t e e s d ee m advisable to m a k e partition w i t h t h e c o - o w n e r s o r joint ow n e r s b e s i d e s the Tru.t hay i ng a n y i n t e r e s t ip W w h i c h the Trustees a r e i n t e r e s t e d a nd to make s u ch partition either b y s a l e o r b y set-off or b y a g r e e m e n t o r otherwise (including w h e r e de e me d desirable p r o v i s i o n ■ ' —. for eguality of e x c h a n g e ) . (j) To take the o p i n i o n o n advice of counsel 'concerning any difference a r i s i n g u n d e r this Settlement o r a ny m a t t e r in any way r e l a t i n g t o the T ru s t Fund or to t h e Trustees' duties in c o n n e c t i o n w i t h t h e ;T r u s t F u n d a n d • ' * . in all such matters t o a c t in accordance w it h the o p i n i o n of such counsel. (k) To employ and p a y a t t h e expense of the T r u s t F u n d any agent in any p a r t o f t h e w o r l d whether an a t t o r n e y solicitor banker a c c o u n t a n t stockbroker or o th e r a g e n t . and whether or n ot b e i n g o n e o f the Trustees h e r e u n d e r to transact any b u s i n e s s o r j d o any act required to b e transacted or done in t h e e x e c u t i o n of the trusts h e r e o f including the r e c e i p t o r p a yment of money and the execution of d o c u m e n t s an d no firm a s sociation or corporation any o f w h o s e securities are included * w ithin the T r u s t F u n d a n d n o ’ pu r ch a se r or o t h e r p e r s o n dealing w i t h an y a g e n t pu r po r t i n g to act under. ’ delegation o r a u t h o r i t y f r o m the Tr u stees s hall .be required to ascertain^ o r inquire w h e t h e r a c a s e e x i s t s ' in w h i c h s u c h d e l e g a t i o n is p e r M t t e d o r w h e t h e r s u c h delegated a u t h o r i t y is s t i l l subsisting P R O V I D E D h o w e v e r that the T r u s t e e s s h a l l n o t be responsible fo r the • default n e g l i g e n c e o r f r a u d of any agent so . or for any loss o c c a s i o n e d thereby although the employment o f s u c h a g e n t w a s n o t s tr ictly n e c e s s a r y or expedient. (1) Upon a n d , for t h e * . p u r p o s e pf any di s t r i b u t i o n o r a p p r o p ri a ti o n o f t h e T r u s t Fund o r any p a r t t h e r e o f in their u n f e t t e r e d d i s c r e t i o n to place such v a l u e o n .any •and all a s s e t s f r o m t i m e to time forming p a rt o f the . T ru s t Fund as to t h e m i n their absolute and u n c o n t r o l l e d • . / discre t io n s h al l s e e m j u s t and proper and any such . . • • ' • .valuation m a d e i n g o o d f a it h shall b e absol u te l y f in a l and bi n di n g and c o n c l u s i v e on all B en eficiaries h e r e u n d e r and f u rther upon an y s u c h discre t io n or a p p r o p r ia t io n to determine to w h o m s p e c i f i e d assets shall be g i ve n and to d i s t r i b u t e the same su bject to the p ay m en t of such amounts as m a y b e n e c e s s a r y to adjust the shares of the i I * ‘ ‘ various Beneficiaries and further that any distributions of the Trust Fund m a y be either made directly to any Beneficiary o r a p p l i e d for his benefit by the Trustees or during his m i n o r i t y made to his duly appointed guardian o r to an y p erson with w h o m he lives or resides for the use of sa i d Beneficiary without responsibility . 6* for its expenditure. . WITHOUT prejudice to the generality of Clause 5 'hereof if the Trust Funds shall i nclude any shares or other interests in a company the ownership o f which gives to t he m the right i«friii '> ' r*rnrtii 11 11 r f . ' J r_ r l j l ' l ' E i r o x ^ H e ifrfalrs or the Company or o f any of its subsidiaries the Trustees' shall be under no liability or duty"to appoint any representative to the Board o f the said Company or of any of its subsidiaries and further shall have no responsibility to enquire into .oversee or take p a r t in. the management or affairs or business of.the Company o r any of its subsidiaries i 7. . ' I N addition to reimbursement of their proper expenses the Trustees shall b e entitled to remuneration1' (free of any probate succession estate o r other death duties wheresoever payable and as a first charge on the T r u s t Fund) for their services as Trustees in accordance with their published scale o f fees in effect at the date of appointment subject to any amendment thereof which m a y be agreed upon from time to time in writing between the Trustees and the person o r persons for 8RS the time being having power to appoint new Trustees hereof PROVIDED ■ . • however that this Trustees may transact on behalf of or with the Trust or any Beneficiary hereunder any business which by their constitution they are authorised to undertake ' upon the same term as would for the time being be made with an ordinary customer and wi t h o u t accounting for any profit thereby made and in.particular and without prejudice to the generality of the foregoing the Trustees ma y retain on current account or deposit .account or advance at interest all moneys necessary or convenient to be retained or advanced in connection with +*« or remuneration paid or allowed by stockbrokers insurance companies or other-»agents without being liable to account j. ■ ■ for any profit thereby made PROVIDED further that...the Trustees m ay transact business on behalf of the T r u s t .or any beneficiary hereunder with any krorporation or partnership in which the Trustees are office holders .or shareholders or partners or are otherwise financially interested or w i th any person or firm holding shares or being otherwise financially interested in the Trustees without being liable to account for any profit accruing to the Trustees as such office holders shareholders or partners as a result of such business and the Trustees may hold office in any corporation shares or securities which comprise or form part of the Trust Fund and shall not be liable to account to the Trust for emoluments received by them as such office holders. • . i I . . m a y at any time or times be removed from their office of i - - Trustees by a deed executed by the Settlor (hereinafter called "the Appointor") and delivered to. the Trustees and the Appointor may by deed executed and delivered as aforesaid ap point a n y other person or persons W h e t h e r or not resident in the Cayman Islands to be Trustees e it h er jointly with any other ‘ then continuing- Trustees o r '’Solely if after removal there shall n o t be any continuing Trustees and thereupon the Trust-Fund shall be by any assurance as m a y be necessary or expedient . v ested jointly in the persons w h o shall thereupon become the o ut going trustee who is liable as. a trus.tee hereof or may on - the death of any person become liable as a former trustee he r e o f for any income probate estate o r other duties fees or taxes shall not be bound to transfer the Tr'ust Fund as aforesaid unless reasonable security is p ro vided for indemnifyihg such outgoing trustee against such liability PROVIDED ALSO that .no removal, of trustees by the A pp o in t or shall be effective unless after such removal (either w i t h o r without a new appointment) there shall remain at’ -least one trustee being a trust corporation o r two trustees being individuals. (b) Without prejudice to the powers contained in sub­ clause (a) of this Clause if a Trustee hereof whether original or substituted shall die or be i ng a corporation be dissolved or shall desire to be discharged from all or any of the trusts or powers hereof or shall refuse or become unfit to act therein persons namely: (i) ■ • • the A p po i n t o r or unwilling to act t: . (ii) . or if he shall be dead or unable I ! I ' ** j • i the surviving o r continuing Trustees hereof for t h e I ' • being or if there b e n o surviving or continuing ’ Trustees ■ . ■ ! (iii) the perso na l r ep r es e nt a ti v es o f the last s u rv i v i n g ; ■ * • I Trustee if such last: T r u s t e e w a s an individual but if • such last Trustee w a s a corporation then such last ■ ' Trustee upon r e ti r e m e n t m a y by d ee d appoint one or m o r e . »i • juiiu. n1 ■ > • •' •j including the persons exerci s in g the power) to be a . Trustee or Trustees in the place of the Trustee so • ■ • .* deceased dissolved d e s i r i n g to be discharged refusing • * r * or being unfit or b e i n g incapable as aforesaid. . (c) * The powers in su b -c l a u s e (a) o f THIS Clause c on - •• tained may at any time b e irrevoc a bl y released b y a deed t I* ’ • . : j executed by the Appointor and delivered to the Trustees and • ’ ^ • . t he Appointor may in like m a n n e r revocably or irrevocably g r a n t ‘ t h e said powers to any p e rs o n or persons to take effect immediately or after the d e a t h o r the Appointor as the case m ay be. . (d) The Trustees h e re o f or any of them (whether or i gi n al or substituted) may if they so d es i re resign as Trustees he r eu n d e r after 30 days written notice of their intention so to do sent by registered prepaid post to the ^ppointor or such person as the Appointor may from time to time appoint in writing. Such resignation shall become e f f e c t i v e upon the day specified in such notice of> resignation. (e) In the event of the resignation of the Trustees h ereof or in case there shall be n o trustee hereunder AfiSBACHER (C.I.) LIMITED of* GUERNSEY, CHANNEL ISLANDS or their successors shall become s u bs t it u te d Trustees hereunder. * (f) Upon the resignation o r removal of the Trustees as hereinbefore provided the T r us t e e s shall be entitled to receive * reimbursement out of the Trust F u n d for all expenses incurred b y t h e m in connection w i th the settlement of the account o f the ’ ' M L u C w S m ,!"r iHiilCMI'T T .I r. "rTTrr (g) On every change in the trusteeship a memorandum s h a l l b e endorsed on or 'permanently af f ix e d to this Settlement s t a t i n g the names of the Trustees for the time being and shall be s i g n e d b y the persons so named and authent i ca t ed by a notary or n o t a r i e s v• . • ’ public and any person dealing w i t h the Trust shall be entitled t o rely upon any such memorandum (or the latest of such memoranda i f more than one) as sufficient e v id e nc e that the persons named therein are the fully constituted Trustees for the time being of this Settlement. (h) Any substituted Trustees of this Settlement shall h a v e all the powers conferred upon the Trustees b y law and these presents and any and all banks b r o k e r s nominees or other d e p o s i t ­ ories or custodians of the Trust F u n d shall be authorised to accept instructions from the s a i d substituted Trustees as to the dispositions thereof. . I ’ • 9*' THE Trustees shall p r o v i d e for the safekeeping of all documents of title and se c u ri t i e s the subject of this Settlement and m a y at the expense of the T ru st Fund (which expense may include any charges for the s a f e custody of securities and the collection and remittance o f income) deposit the same in the c ustody of any bank b an k i n g co m p a n y corporate trustee or s t o c k ­ b r o k e r in any part of the w o r l d that undertakes the safe c u s t o d y of securities as part of its b us i n e s s but so that the Trustees shall not be in any wise r e s p o n s i b l e for the misapplication o f the s a me or any of them b y s u c h ba n k banking company corporate trustee or stockbroker or fo r any loss which may b e occasioned 10. IN the event of any in c om e probate estate or other duties . ' ■ ■ fees or taxes becoming p a y a b l e in the Cayman Islands or else­ w he r e in respect of the Tr u st F u nd or any part thereof on the de a th of the Appointor or of a ny me m be r of the Appointed Class o r otherwise the Trustees m a y at their discretion pay all or any part of such duties fees and taxes out o f the Trust Fund w it h o u t recourse against any m e m b e r o f the Appointed Class o r refuse to pay the samp o r a ny p a r t thereof unless indemnified and to determine the time and ma n ne r of such payment if any. 11. N O bond shall be r e qu i r e d of the Trustees herein named (whether original or substituted) or if a bond should be requi r ed by law to the extent that a w a i v e r b y the Appointor is effective no surety shall be required on such a bond. « i if 12- THIS Trust shall b e i r r e v o c a b l e and the A p p o i n t o r expressly waives all right a n d p o w e r whether alone o r in conjunction w i t h any o th e r p e r s o n to alter amend or re v ok e * •• t hi s Settlement in whole o r i n p a r t o r as to any o f its terms. 13. • • THE Trustees shall n o t b e p e r s o na ll y -liable o n c o n t r a c t s m a d e by them in the a d m i n i s t r a t i o n o f the T ru st a n d p e r s o n s e n t e r i n g into contracts w i t h t h e Tr u st e es shall look s ol e ly t o the Trust Fund. 14. ’ WITHOUT p r ej udice t o t h e r i g h t under the g e n e r a l law o f the Trustees to refuse d i s c l o s u r e of any docum en t it is. h e r e b y declared t h a t the T r u s t e e s shall n ot be b o u n d to d i s c l o s e (1) A n y d o cu m en t d i s c l o s i n g any deliberations o f the T r u s t e e s (or any of the T r u s t e e s ) as to the ma n ne r i n w h i c h t h e Trustees should exerc i se a n y p o w e r o r any discretion c o n f e r r e d k u p o n the Trustees b y this S e t t l e m e n t or disclosing t h e reasons f or a n y p a rt i cu l a r exercise o f a n y such power or a n y such d iscret i on o r the ma t er i al u p o n w h i c h such reasons sh a l l .or m i g h t have b e e n b a s e d (2) A n y o t h e r d o c u m e n t r e l a t i n g to the ex e rcise or p r o p o s e d exerci s e of any p o w e r o r a n y discretion c on f e r r e d on the Trustees b y this S e t t l e m e n t (not being legal a dvice o b t a i n e d b y the Trustees at the cost o f t h e i r trust estate) A ND IT IS E X PR ESSLY P R O V I D E D that the TRUSTEES MAY PE R M I T A N Y member of the A p po i nt e d C l a s s perso n al l y to inspect any c o p y o f this Settlement o r any d o c u m e n t s relating to the T r u s t at t h e principal office of any c o r p o r a t e trustee hereof but shall n o t be b o u n d to give any f u r t h e r information to any member of the A pp o in t ed Class r e la t in g t o the affairs o f the Trust or to p e r m i t * •• any member of the A p p o i n t e d Class to make any copies of a n y documents relating to the T r ust. 15• . THIS Settlement is m a d e under the laws o f the Cayman Islands and the rights o f a l l parties and the construction a n d e f f e c t of each and e v e r y p r o v i s i o n h er e of shall be subject - t o t h e exclusive j u r i s d i c t i o n o f and construed only according to the laws of the C a y m a n Islands which shall be the forum f o r the administration of this T r u s t PROVIDED however .that the by de e d declare that th i s T r u s t and the rights of all parties and the construction ‘ and e f f e c t o f the provisions hereof shall from the date of such d e c l a r a t i o n be subject to the exclusive jurisdiction of and c o n s t r u e d only according to the laws of some other jurisdiction (other than the C ay m an Islands) in w h i c h one or more of the T r u s t e e s then serving in office is • res i de nt and the fo r um f o r the a d m i n is t ra t io n of this T rust s hall thenceforth b e s u c h o t h e r jurisdiction PROVIDED further V , * t h a t the Trustees m a y n o t d e c l a r e that this Trust and the r i g h t s of all parties and the c o n s t r u c t i o n and effect of the p r o v i s i o n s I ‘ h e r e o f shall be subject t o the jurisdiction of and construed a cc o rding to the laws o f a jurisdiction w h ic h would cause a material change in the ri g h t s of any m ember of the Appointed Class hereunder or which w o u l d not recognise the validity o f this Trust if such non-recognition would result in the revocation or termination o f the Trust. IN WITNESS where of the sa i d JOHN A.; FURZE has set his hand and seal and the C o m m o n Seal of ANSBACHER LIMITED has been hereunto a f f i x e d the day and year first before .written. . Signed and Sealed The .Common Seal of. ) ANSBACHER ) LIMITED » was affixed by • ' JOHN A . COLLINS and j : ) m PETER A . HART? ) in the presence of: ) W xtm ess ” ) ' FIRST US?]00.00 SCHEDULE (one Hundred Dollars United States currency) S EC O ND SCHEDULE . A ny individual or corporate entity contributing the sum o f U.S. dollars ten or more to th e Cayman Islands Branch o f the B r i t i s h Red Cross Association u po n the production to the Trustees of a receipt for said donation, signed by the Treasurer m m s. m m ^ o ^ ^ ^ ' ^ i i s s o c i a t l b h ' a nd in" the event the said Association ceases to m a in t a i n a branch in the Cayman Islands, b y contribution to the Bead Office of the said Association in Geneva, Switzerland. " SIGNED SEALED AND DELIVERED ) . b y hte above-named, in.the pr e sence of:j THE C O M M O N W E A L OF A NS B ACHER LIMITED b*d hereunto affixed 'presence of: — 7 Witness BE IT REMEMBERED that on the 27th day Of November 1989 before me a Notary Public in and for the Cayman Islands personaljl cane and appeared MfiRIBELLE- BROWN who on oath swears that she was present and did see JOHN A . FURZE duly sign and seal and as and for his act and deed execute acknowledge and deliver the within Deed for the purposes therein mentioned. SWORN AND SUBSCRIBED TO before me at George Town, Grand Cayman this 27th day Of November 19 89 v£itness kotary Public Cayman Islands ' • P R O B A T E • *"»• . BE IT REMEMBERED that on the 27th day Of November 19 89 before me a Notary Public in and for the Cayman Islands personally’ came and appeared m a ribeixe b r o w * who on oath swears that she was present and did see John a . collins and • . PETER A. HARTY for and on behalf of ANSBACHER LIMITED duly sign and seal and as and for its act and deed execute acknowledge and deliver the within Deed for the purposes therein mentioned. SWORN AND. SUBSCRIBED TO before me at George Town, Grand Cayman this 27th day Of November 1989 . Witness Notary Public Cayman Islands Om?ha Trust Trust Accounts I Omaha Trust UNAUDITED 2000 September 30 (Expressed in Pounds Sterling) A SSETS Cash 5,006 858,602 1,859 864,967 Fixed deposit Accrued income_____ LIABILITIES Accounts payable and accrued expenses N E T A SSETS 1999 1,356 827,046 1,796 830,198 (288) £864,679 £880,031 741,880 741,763 £864,679 £830,031 REPR ESENTED BY: Capital Account For and an behalf of Ansbacher (Cayman) lim ited Trustee U U L Omaha Trust Income Account Septem ber 30 2000 1999 (Expressed in Pounds Sterling) INCOM E Bank Interest 38,918 42,793 4,148 239 3,935 170 4,387 4.105 84,531 38,688 £122,799 £88,268 EXPENSES Trustee fees Accounting N E T INCOME BALANCE AT END OFY&AR ^ OmahaTrust C apital Account Septem ber 30_______________________ __ ____________________________ (Expressed in Pounds Sterling) . • b a l a n c e a t b e g in n in g o f t e a k Foreign exchange gain BALANCE A T E N D OF YEAR 2000_____________1999 . 741,768 741,723 117 40 £741,880________ £741,763 Omaha Trust unaudited N otes to the Trust Accounts (Expressed in Pounds Sterling) Septem ber 30,2 0 00 D BACKCKOL'Ni) INFORMATION The trust was established by deed of settlem en t dated November 2 7 ,1 9 8 9 in the Cayman Islands. 2. AO C ’O l N T 1 N O I’O I T C I K S These tru st accounts have been prepared in accordance w ith International Accounting Standards and the significant accounting policies are as follows: . CashFlowStatement A. flow statem ent so t been prepared as the users o f the financial statem ents are fu lly informed of a ll transactions involving cash or cash equivalents, and no additional inform ation would be provided by preparing a cash flow statem ent. Foreign Currency Translation M onetary assets liabilities denom inated in foreign currencies have been translated into Pounds Sterling a t the rates of exchange prevailin g a t the balance sheet date. Income and expenditures. transaction occurred. R esultant exchange gains or losses have been taken to th e Capital Account. '0 Trust Accounts September 30, 1999 OMAHA TRUST Balance Sheet Septem ber 30 (Expressed in Pounds Sterling) A SSE T S Cash Fixed deposit Accrued incom e . N E T A SSE T S R E PR E SE N T E D BT: Income Account C apitalA ccount ---- \ * k Jj+ / b t For and on b eh alf of Ansbacher (Caym an) lim ite d T rustee Financial statem en ts received and approved 1998 (Notea) • L IA B IL IT IE S Accounts payable and accrued expenses -----^ ? . ..!3, 1999 __ 1,856 827,046 1.796 880,198 3,379 787,772 301 791,462 (167) (149) £880,081 £ 791 ,3 03 88,268 49,580 £ 880,031 £791,303 . Income Account 1999 Septem ber 30 Bank Interest E X PEN SES Annual trustee fees Accounting fees N E T INCOME 1998 (Notea) (Expressed in Pounds Sterling) INCOM E •* ........ 42,793 53,591 3,935 170 3,862 149 4,105 -....... 4,011 88,688 49,580 BALANCE A T EN D OF YEAR____________________________________ £88,268_________ £49.580 OMAHA TRUST ___________ ;______________ ________ UNAUDITED Capital Account 1999 Septem ber 30 (Expressed in Pounds Sterling) BALANCE A T B EG IN N IN G O F YEAS, Foreign exchange gain (loss) BALANCE A T E N D O F YEAB . 1998 (Notes) 4 _ . • 741,723 40 741,885 (162) £741,768________ £ 7 41 ,7 23 n OMAHA TRUST UNAUDITED N otes to th e Trust Accounts (Expressed in Pounds Sterling} Septem ber 30,1999 15A < K < ;U C H \ I) 1M ■■'<>K \1 A T I <>N The tru st w as established by deed of settlem ent dated November 27,1989 in th e Caym an Islan ds. A C C O U N T I N G POLICIES These trust accounts have been prepared in accordance w ith International A ccounting Standards and th e significant accounting policies are as follows: Cash FlowStatement •' A cash flow statem en t h as not been prepared a s the users o f the financial statem en ts are fully inform ed o f a ll transactions involving cash or cash equivalents, and no additional inform ation would be provided by preparing a cash flow statem ent. Foreign Currency Translation M onetary assets and liab ilities denom inated in foreign currencies have been tran slated in to Pounds ■rifltwaeiipg: been taken to th e C apital A ccount. . . . - 4' A .4 .F..-.. . ?mg . . . . .Scaoou?uwatII. I'll-loft.33OMAHA TRUST September 30 (Expressed in. Pounds Sterling) ASSETS Cash Fixed deposit Accrued incom e Current A ssets L IA B IL IT IE S Accounts payable and accrued expenses N ET A SSE T S R EPR ESENTED BY: Incom e Account For and on behalf of Ansbacher (Cayman) Lim ited Trustee Financial statem ents received and approved UNAUDITED (Notes) 8,379 787,772 801 791,452 ilM. 3,706 739,157 138 743,001 (1,116) £791,303 741,885 49,580 741,723 741.885 r OMAHA TRUST ... ...... UNAuomm In co m e A ccount 19 9 8 S ep tem b er 30 (Expressed in Pounds Sterling) IN C O M E B a n k In terest E X PEN SES 1997 (Notes) 5 3 .5 9 1 4 2 ,7 5 4 £ 5 8 ,5 9 1 £ 4 2 ,7 5 4 i .A nnual tr u ste e fe e s . T ru stee tim e sp en t ch arges A ccou n tin g fees ’ 8 ,8 6 2 3 ,9 4 4 ~ 7 *49______________ ±LiiL • ' __________ _________________________ ____________________________ 4 ,0 1 1 BALANCE AT END OF YEAR £ 4 9 ,5 8 0 4 ,4 6 2 £0 O dm aha t r u st wmmmmmmmmmmammmm C apital Account Septem ber 30 1998 1997 £741,885 £ 7 0 3 ,6 5 2 (Notes) (Expressed in Pounds Sterling) • BALANCE A T BEGINNING O F YEAR Transferred from Incom e Account i G ain/(loss) on foreign exchange BALANCE A T END O F Y EAR i - 38,29 2 (162) (59) £741,723 £ 7 4 1 ,8 8 5 OMAHA TRUST N otes to the Trust Accounts (Expressed in Pounds Sterling) S ep tem b er 3 0,19 98 i. n.v< kf arxn n i > rvFuu.vLVt i<>.\ The trust w as established by deed of settlem ent dated November 27,1989 in the Cayman Islands. 2. ,\CO»L Y U V . POLM'US These trust accounts have been prepared in accordance with International Accounting Standards and the significant accounting policies are as follows: Foreign Currency Translation A ssets, other than quoted investments,, and liabilities denominated in foreign currencies have been translated into U nited States dollars at the rates of exchange prevailing at the balance sh eet date. Quoted investm ents, income and expenditures denominated in foreign currencies have been translated using the rates applicable at the date of the transaction. Resultant exchange gains or losses have been taken to the income statem ent. r \ • O M A H A TR U ST FINANCIAL STATEM ENTS FOR THE Y EAR E N D ED 30 SEPTEM BER 1597 ^Tfsr-^.,-qTw 7^ - . . . . . OMAHA TRUST FINANCIAL STATEMENTS FORTEEYEARENDEDMSEPTEMBERIMS Vu', .. I . inn-r O M A H A TRUST BALANCE SHEET AS AT 30 SEPTEM BER 1995 (expressed in Pounds Sterling) 1994 ASSETS Cash at Bank Current accounts Fixed deposit 813 666,000 Accounts receivable Represented by CAPITAL A C C O U N T -I-."":- ) j ’. . ' ' U ■ O M A H A TRUST INCOME ACCOUNT FOR THE YEAR ENDED 30 SEPTEMBER 1995 (expressed in PoundsSterttng) Two y ea n ended 30-Sep-94 INCOME 45,476 Bank deposit interest EXPENSES Accountancy fees Management fees NET INCOME FOR THE PERIOD Transferred to Capital Account BALANCE CARRIED FORWARD CAPiTALACCOUNT FOR THE YEAR ENDED 30 SEPTEMBER 1995 (expressed imPounds Sterling) Two years ended notes 3flbSfipr24_ 628,047 BALANCE BROUGHT FORWARD Additions during year Transferred from Income Account Distributions BALANCE CARRIED FORWARD 39,825 £ 667,872 £ O M A H A TRUST NOTES TO TH E FINANCIAL STATEMENTS FOR THE Y EA R ENDED 30 SEPTEMBER 1995 (expressed in Pfunds Sterling) 1. BACKGROUND The trust was ' by Indenture o f Settlement dated 27 November 1989. 2 . ACCOUNTING POLICIES These statements have been prepared in accordance with generally accepted accounting principles and the principal accounting policy is shown below. In the previous accounting period, the statements were prepared on die cash basis. N o restatement o f the previous years' figures, due to the change in accounting basis, has been made, since the adjustments would have been immaterial. FOREIGN EXCHANGE TRANSLATION prevailing at the dates-of those transactions. Resultant exchange gains or tosses have been taken to die profit and loss account 3 . CAPITALISATION O F INCOM E • " Under the exercise o f die Trustee's discretion, any balance on Income Account at year end is Fa: quarter ended: Withdrawal fees 30 June 1993 30 September 1993 31 December 1993 31 March 1994 30 June 1994 30 September 1994 31 December 1994 31 March 1995 30 June 1995 30 September 1995 1,000 1,000 1,000 1,000 1,000 O M A H A TRU S T FIN A N C IA L STATEM ENTS FO R THE TWO Y E A R S EN D ED 30 SEPTEMBER 1994 M i l / O M A H A T R U S T BALANCE SH EET A S A T 30 SEPTEM BER 1994 (expressed in Pnmds Sterling) 1992 A SSETS Cash at Bank Current accounts Fixed deposit Represented by CAPITAL ACCOUNT (3,874) 631,921 OMAHA TRUST IN C O M E ACCOUNT FOR THE TW O Y E A R S EN D ED 30 SEPTEMBER 1994 (expressed in Pounds Sterling) 2 7 -N « v -8 9 to 30-Sep-92 INC O M E 83,764 Bank deposit interest j * VSES Accountancy fees Management fees N E T INCOM E FO R THE PERIOD Transferred to Capital Account BALANCECARRIED FORW ARD .Vj'v:.V ti.. ...............••• - ••• 1 ~VV..V.1 •’ ■ - C A PITA L ACCOUNT FOR THE TW O Y E A R S EN D ED 30 SEPTEMBER 1994 (expressed In Pounds Sterling) notes BALANCEBRO UG H T FORWARD Funds settled Additions during year Transferred from Income Account Distributions BALANCE CARRIED FORWARD 1993 758,297 3,342 76,408 (210,000) n ; OMAHA TRUST NOTES TO T H E FIN AN C IA L STATEMENTS FOR TH E TW O Y E A R S ENDED 30 SEPTEMBER 1994 (expressed In Poanda Sterling) 1. BACKGROUND /*“v The trust was established by Indenture o f Settlement dated 27 November 1989. 2 . ACCOUNTING POLICIES These financial statements have been prepared in accordance with generally accepted accounting principles and on the cash basis. The principal accounting p o lk y is as M o w s: o i items denominated in f i^ g n currtpxa^ have beKi tx v n sfi^ at tbe ratdi prevaHingat the dates ofthose transactions. Resultant exchange gains or losses have been taken to the profit and loss account 3. CAPITALISATION O F INCOM E Under the exercise o f the Trustee's discretk>n,anybalanceonIncom eAcc6untat year end i s capitaRsed b ytran tftrtotheC ap italA ccou nt v :: : v'l:L •• ■C .', . . - O M A H A X obiebc T R U S T ^ADSDb GBGs m UIIDKXI AxisbachcrHiaan, P.O. B a x 887, Gxaad Qtynun B.WX AND HAl.AWfRCTTBET AS AT Accounts agreed and accepted: , ^ h € L _______________ Date: ^ 7 ^ OMAHA TRUST Minas A b A t 30di Scumuhcr 1 W . (All figures ex p ressed in Pounds Starting) LIABILITIES; Capital Accounts Payable 758,296.84 22SQ.QQ £760.546.84 Represented by — Staling Fixed Deposit Steriing Current Account 761382.49 (83?.651 'fet Tnrrwnc: .«*■» Interest Received . 61382.49 Less EzEBBOdmsi / - , Funds Injected Surplus Income 700,000.00 58-296.84 f758^6j4 A UtmktrtfAtMtmyAiaMmr BoUt*t>flCMmhmt Jbnfant Croup MX b l rn.Onad Cayman. Bri»fc W«a i»di~ Please reply to: .V* .* PtKMc (m) MM6U/4 Trine ( 7 003 42 FlttwQliam Square, Dublin 1 Tel: 765144/763065 Rue 612035 ftuc (Ml) NM N6 (MQMMKT • 30th April, 1991, G a rra tt Logma, Sag. , Ir is h In ta rc o n tin a n ta l Bank L im ita d , 91 M arrion Square, PPBLXH 2 . Daar G a rra tt, • Coaid you plaaaa arranga to la t ma hava fo r c o lle c tio n a • S ta rlin g D ra ft fo r f 2 , ~ ~ - • - DPC/AJW m . r ~ ; ± * **m* r * * * * " > 4 m M m HeUmts fLC M*dw,t \ t • «fVj - * i*-’ 1 ^S"* * . Please reply to: <2 FtawflUam Square, Dublin 1 Td: 763144/763065 Fax: 6I2Q35 P.O. Sox 0 7 . C nnd Ciym tn. Briti* W«« M fe Pfcoac (109)Tit K 1ii Trim CP 4305 Fsx: (109)949-7946 (•09)949-33(7 1 5 th A u g u s t, 1991 G a r r e t t Logan, Esq., Iri sh Intercontinental B a n k Limited, 91 M e r r i o n Square, DUBLIN 2 . De ar Garrett, C o u l d y o u please Y o u r * sincerely. F o r A N S B A C H E R LIMITED *v*•' ) Please reply to: 42 Fitzwflliun Square. Dublin 2. Tel: 765144/763065 Fax: 612035 Facsimile (S09) 949-7946 . . (FtanabrAufaacberLimited) S th A p r il, 1993. Ronan Redmond, Es q ., Co rporate Services, Ir is h In te rc o n tin e n ta l Bank L im ite d , 91 M e rrio n S q uare, DUBLIN 2. D ear Ronan, your* - ^ J ^ -f*i &>r CAYMAN INTERHATIOHAL BANK AND TRUST CO. LTD. .'•*< 'ja^/V5 'v v ? i"V DPC/AJW Guernsey - Monaco - Zurich • Nassau - Cayraan - BV1 /' •.Ti• '* / # APWd-ix . Bank ancPWuat C o m p a n y Limited International P.O. Box887 GnndCayman BritihWatt Mas T*phom 80S 949 8655 Tain CP4305 FacaWa 809 W« 5287 Trust G r o u p T e le fa x From: Ref no. A. F u t m , Eaq. To: Iriah In t« rc o n tin « n ta l Bank, D ublin Ire la n d Attention: ROMAN b h to n d , Fax No: ssq . 0 11-3331-6783-034 Data: 15-03-94 nil* pone only (MudngNiomf: F YOUHAVENOT RECEIVEDTHE TOTALNUMBER OF PAGES OR 9 YOUHEED AS5STANCE PLEASE CALL OOI) MfrMU CCNTOWTlAUrrNOTICE TM» toM a raaagt indtor tw doewrart* tceomftnftq 1 m*i ba prtrttB* md eonMnW tni annp tom dkdotin ante •RtaMlM HwiMdrliml>wH iMr«eifln n».plaawmwdMi>ynoitl fM»tyM»phonaon(<0»)H>iaW«ndmMtmm>Brtma«din)H8plaabMaa»MowaipB»ifcli. Th«* ycu • ' ------ -— ------- -— --------------------------- --------------- i*oic>St> Guamaay. Monaco, dMtnriand, l*ia of Man. fithinw, Cayman Wanda, BrMah Virgh Uland* P.0.ABaS7 SiMEnm fl iMEn pS pE R S h o m w Tiw m & s H a u k tn m s m T e le fa x r Ref no. From: Join A. Jtanw To: Iris h Intercontinental Bank - Dublin, Ireland AttsnSon: MS. OURS HGLW-O&aztK’ Fax No: 011-353-1-678-S034 Dale: 15 t& m rtm r, 1994 We ihonldbe trtirful if too wodd delft oor ■cconntnnmbc 02A)lW7/81intfa« «um of gjy, itmmaAaA far Ait tmoum to favour of A. EASTWOOD. Draft will he collected oabdaJf of Mi. Joan WilHtms. WYOUHMfllHOTNBtNtOTHETOTALWJU8MOrMBS ORVYOUNRDASSISTANCENJMKCALL(KMMM6H ooNnoBmAurvNoncs * !"* * " to ^ *• ***** m t eontum ud urn* tan M ow* md* w^KfwiMdWM,fedoan.topytoa.jhWKlM* «MM*u£oal A. £ 17 Those banks change 1 Fountain Developments you might also like to look at 2 two further documents which I will give you 3 to 389. 4 back I will ask you about those, particularly 389. -- 370 We will break for coffee and when I come 5 SHORT ADJOURNMENT 6 7 8 9 141 Q. JUDGE O'LEARY: 10 Can we turn to the Tabmount Corporation. 11 Do you know anything about that? 12 MR. ENOCH: 13 There is something I would like to say before we go 14 on. 15 relation to Martina Investments Ltd, Tabmount 16 Corporation and the Anne Enoch trust. 17 make it clear that I am aware of these entities as I 18 have said but I do not have any ownership interest 19 in them and therefore I am not in a position to 20 answer questions in relation to them. 21 is that questions in relation to these entities 22 could perhaps be addressed to my father who is 23 unfortunately old and not in good health. 24 142 Q. It might appear that I have been vague in I wish to The reality You will have noticed that when you told us about 25 Martina Investments, 26 other questions to ask you about that. 27 have questions to ask you about the 28 Tabmount Corporation. 29 your name came in notwithstanding the fact that you I dropped that. I have no But I do Did you see that letter where 1 2 3 143 Q 4 A MR. SHIELDS: Which letter? JUDGE O'LEARY: Exhibit 2? Absolutely. This is a complete and utter mystery to 5 me. 6 Fountain Developments is something that I have never 7 heard of. 8 144 Q 9 A 10 11 I am aware of our family interests and this You think your name was used in error there? Absolutely. I never heard of it. I don't know anything about it at all. 145 Q I am going to give you another document at 12 Exhibit 3. 13 document which we got from Guinness & Mahon and is a 14 Guinness & Mahon internal document, so you know the 15 source of it. 16 second. 17 I am sorry for going backwards and forwards. 18 look at Exhibit 2 again, the one you think you know 19 little or nothing about? 20 A 21 146 Q 22 This document you don't have. It is a If you leave that to one side for a If you Yes . You see there was a letter referred to in that of 24th January 1991? 23 A 24 147 Q 25 Yes . I wonder would you give the witness Exhibit 4 (same handed). 26 A 27 148 Q 28 A 29 149 Q Do you remember getting that letter? No, not specifically. Is it possible that you got the letter, Exhibit 4? Yes . I thought you knew nothing about Fountain 27 1 Developments. 2 Whom? 3 150 Q 4 A 5 151 Q I thought you had no involvement? Fountain? Where is the word fountain written in this letter. It is not but if you look at Exhibit 2 of 6 22nd November 1991 you see that it refers therein to 7 a letter from Chris White's letter of 8 24th January 1991? 9 152 Q It refers here "conforming with guidelines given to 10 Stephen Enoch." 11 interest. 12 with Girard Investments and they weren't very 13 efficient with the amount we had to pay and where we 14 had to pay i t . 15 in Guinness & Mahon to find out what was going on 16 and how it was paid and where it was paid. 17 there still is no relationship between the two 18 things ? 19 153 Q 20 21 Maybe this is how you actually pay I know that I used to pay the interest I used to have to telephone people But You think there is no relationship between the two things ? A I know there isn't; I have never heard of 22 Fountain Developments and as far as I know none of 23 our family members have had ever had any involvement 24 with Fountain Developments or Florida or anything in 25 Florida. 26 Would you turn now to the Tabmount Corporation at 27 Exhibit 3 which you already have. 28 about the Tabmount Corporation. 29 that? Remind me again Are you involved in 1 A. No, this is actually incorrect. The first statement 2 on the top of that which says "the beneficial owners 3 are Victor Enoch, his son Stephen Enoch and other 4 family members." 5 as I know. 6 together in their correspondence for their own 7 purposes. 8 155 Q. 9 A. 10 156 Q. 11 A. 12 157 Q. 13 A. 14 158 Q. I am not a beneficial owner so far They seem to lump a lot of things You don't know anything about Tabmount Corporation? I am aware of it. Do you know who the owners are? No, not the legal owners. Do you know who the beneficial owners are? No. I didn't do a note of it. It is in the transcript 15 but I am sure you will remember it. 16 you become a depositor yourself in Ansbacher? 17 A. 18 159 Q. 19 A. What date did June 1990. Have you any comment to make on Exhibit 5? Yes, the first statement so far as I am aware is 20 incorrect, that the beneficial owners are Victor and 21 Stephen Enoch and family members, the same as it 22 said before. 23 160 Q. 24 owner in Tabmount? 25 A. 26 161 Q. 27 A. 28 162 Q. 29 So far as you are concerned you are not a beneficial No. Or any of its offshoots? No. Obviously this might be one company owned by another company. The ultimate beneficiaries don't include 1 2 3 163 Q 4 A Surely you would be aware of it? No. As I said to you before, these questions 5 perhaps should have been addressed to my father. 6 If you knew my father, my father is his own man. 7 He does whatever he does. 8 164 Q 9 When you say no, do you mean no, you are not a beneficiary or no, you wouldn't be quite sure 10 because you could have been made a beneficiary 11 without your knowledge? 12 A It is possible I was made a beneficiary without my 13 knowledge. 14 am not, so I don't know. 15 165 Q I have no knowledge whether I am or I Presumably your family is like every other family, 16 as you get older you take more and more 17 responsibility from your father? 18 A One would like to think that, yes. But if you knew 19 my father as I know my father you wouldn't 20 necessarily say that. 21 father could put me as a beneficiary and the next 22 day put the cats and dogs home as the beneficiary if 23 he felt so inclined. 24 16 6 Q 25 A It is quite possible that my It is possible you are a beneficiary? Certainly it is possible, yes. I would go further 26 to say I hope I might be. 27 idea. 28 I don't believe in hiding things from people. 29 But I really have no 1 What interests me with regard to these various loans 2 is the fact that they appear to have been taken out 3 in Dublin, in Guinness & Mahon in Dublin, and that 4 they appear to have been backed by Ansbacher 5 deposits ? 6 Right. 7 168 Q Dublin over the years? 8 9 Who was your contact for arranging those loans in A John Collins in Ansbacher Cayman. I never had any 10 dealings whatsoever in Dublin other than on payment 11 of interest and invoices and things. 12 done through John Collins. 13 it was all the one company. 14 the Cayman one owned the Dublin one. 15 Guinness & Mahon in those days. 16 & Mahon owned the Cayman one or why they did it that 17 way. 18 169 Q Everything was It appeared to me that I don't know whether It was Or whether Guinness I have no idea. But you do understand that because the loans were 19 taken out in Ireland and backed by Ansbacher 20 deposits, that they are relevant to the Ansbacher 21 enquiry. 22 A 23 170 Q Do you understand that? Yes . I wouldn't like you to think that we are prying into 24 your affairs just for the sake of prying into your 25 affairs. 26 entitled to be told that. 27 number of questions along that line that she wants 28 to ask you. 29 There is a reason for it. You are I think Ms. Mackey has a 1 matters that were raised 2 earlier in this interview that I would like to tease 3 out a little bit more and clarify. 4 preliminary can I ask you, have you and your father 5 been in partnership in business in the United States 6 since you moved from Ireland? 7 A 8 172 Q 9 As a No. You didn't work together with your father in any connection? 10 A 11 173 Q No. Insofar as documents such as the ones we have just 12 shown you now indicate that you and your father 13 together took out loans from Guinness & Mahon in any 14 capacity, do you say that is incorrect? 15 A 16 17 Yes because it is my belief that my father has never done anything in his own name. 174 Q So that when again Guinness & Mahon documents speak 18 of the Enochs or Victor and Stephen Enoch, do you 19 say that is just your father alone in reality? 20 A 21 175 Q You would have to be more specific. For example, the two documents that you looked at a 22 few moments ago -- Exhibit 3 and Exhibit 5 -- in 23 relation to Tabmount Corporation? 24 A 25 26 I have had no involvement with Tabmount Corporation at all. 176 Q There is a statement in both of those that 27 Tablemount NV -- which is the parent company of 28 Tabmount -- is owned by a number of trusts of which 29 the beneficial owners are Victor and Stephen Enoch 1 and other family members. 2 your father's. 3 your knowledge you are not a beneficial owner at all 4 of any of these trusts. 5 what you said? 6 That's correct, yes. 7 177 Q 8 A 9 178 Q 10 A 11 12 You say that in fact to the best of Is that correct, is that Of any trust? What do you mean any trust, any of these trusts? It says here a number of trusts? I am not aware of whether I am. It doesn't mean to say that I am not. 179 Q 13 You are not aware of being a beneficiary of any trust? 14 A 15 180 Q 16 A 17 18 Your name is linked with Certainly not these ones. What are these ones? You are talking about Tabmount or Tablemount? They are not really trusts I don't think. 181 Q No, they don't appear to be trusts. 19 The statement here says that Tabmount Corporation is 20 owned by Tablemount NV. 21 company, Tablemount owning Tabmount. 22 is in turn owned by a number of trusts of which 23 Victor and Stephen Enoch are the beneficiaries? 24 A We have this parent Tablemount NV I am not aware of those trusts at all. What they 25 are, who they are or who owns them. 26 That leads me onto the main question I wanted to ask 27 you. 28 Judge O'Leary asked you about a trust, whether a 29 trust had been formed after you left Ireland? At the beginning of this interview 1 2 183 Q You said yes, a Cayman trust was formed by you as I 3 understand it when you were in the States, is that 4 correct? 5 A 6 7 trust. 184 Q 8 9 I formed a trust, I am not sure when I formed a You are not sure when, I thought it was after you went to the States? A Certainly it was after I left Ireland. That I am 10 certain because I never had any dealings whatsoever 11 with Ansbacher. 12 185 Q 13 A 14 It would have been a general trust for whatever I needed it for at the time or in the future. 15 186 Q 16 A 17 187 Q 18 A 19 20 What was that trust? Did it have a name? Certainly it had a name. Can you tell me what the name was? No, because I actually cannot remember what it was called. 188 Q Can you tell me how it came about that the trust was 21 formed. 22 set up a trust in Cayman? 23 A 24 189 Q 25 A 26 190 Q Take it step by step: Who advised you to Either Don Reid or John Collins. You are not sure which? No. Did you go to one or other of them and ask advice or 27 did they approach you and suggest the setting up of 28 this trust? 29 A It is a long time ago so I don't recall. 1 191 Q 2 A 3 192 Q 4 A 5 6 I don't know. Roughly? Sometime in the 1980's or 1990's, I really don't know. 193 Q It was likely to be between 1980 and 1990 for 7 example. 8 Perhaps you can remember it that way. 9 1979? 10 A Was it long after you went to the States. You went in I have a feeling it is more recent than that but I 11 cannot really remember because it is not something 12 particularly significant. 13 194 Q 14 A 15 195 Q Did you only ever create one trust yourself? Yes . Then it would be relatively vivid in your mind I 16 would imagine. 17 and if you have only created one you would have some 18 memory of it. 19 trust ? 20 A It is not a thing one does everyday Did you feel a need to set up a I must have been advised that it was a good idea to 21 do it. 22 these trusts and what they do and how they operate. 23 196 Q But quite honestly I don't really understand You were advised either by Don Reid or by 24 John Collins that it would be a good idea to do 25 this. 26 they explain it to you? 27 After I left this country the idea was that one 28 would have a trust that one could put assets in that 29 one would leave to ones children or something which What did they tell you about it or how did 1 2 197 Q 3 be in the Cayman Islands? 4 A 5 198 Q 6 A 7 199 Q 8 A 9 200 Q 12 A 13 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Was there any reason given for that specifically? No. Did you sign a trust deed? I really don't have much recollection of the trust. anything. 11 15 Yes . I am not certain if I received anything or did 10 14 Did they suggest to you at that stage that the trust Did you recollect signing a trust deed? No, I don't recollect signing. trust deed is. 201 Q A document. document? I don't know what a I would have to see one. Obviously it is some kind of legal 1 I presume there must have been something or other 2 when you set it up but whether the person setting it 3 up signs these things or not, I don't know. 4 202 Q 5 A Yes, but I don't know whether the person setting it up signs anything or doesn't sign anything. 6 7 It was not yourself who set it up, was it not? 203 Q I see, you don't know whether the person....(INTERJECTION). 8 9 A 10 204 Q I don't know the mechanics of the whole thing. Do you remember writing a Letter of Wishes 11 indicating what would happen to the evidence in the 12 Trust? 13 A 14 205 Q 15 A 16 206 Q 17 A 18 207 Q 19 A 20 208 Q And do you not have a copy yourself? 21 A No, because I know what it contains. 22 209 Q 23 24 Yes . You do. Yes . Do you have a copy of that? No. What happened to it? It would be with Ansbacher. Perhaps you wouldn't mind telling me what it contained? A Basically it would contain if I died and whatever 25 assets were in Trust would go to my wife and 26 my wife dies to my children. 27 really. 28 Like a Will, yes, so this was this was your Letter 29 of Wishes. when A bit like a Will Did you at the time that this Trust was 1 set up, whether you signed something other than the 2 Letter of Wishes or not, did you then transfer funds 3 to the Trust? 4 Possibly over a period of time, yes. 5 211 Q 6 And how was that done? MR. SHIELDS: Could I have a minute, 7 please, with my client? JUDGE O'LEARY: 8 Certainly. 9 10 A SHORT ADJOURNMENT 11 12 THE INTERVIEW COMMENCED, AFTER THE SHORT 13 ADJOURNMENT, AS FOLLOWS: 14 15 A 16 17 It seems to me that you are delving into my personal affairs after I left this country. 212 Q MS. MACKEY: No, Mr. Enoch, I am 18 delving into your personal 19 affairs, indeed that's correct, but only insofar as 20 it relates to the company that we are investigating 21 which is Ansbacher. 22 23 Now, in fact perhaps I should have asked you at the 24 very beginning, 25 this is a Cayman Trust, it is an Ansbacher Trust, 26 but if it is not an Ansbacher Trust, tell me that 27 now and I won't ask you any more questions about it. 28 Is it not an Ansbacher Trust? 29 It was set up by Ansbacher, yes. I took it for granted that because 1 It was set up. 2 and I must ask you about it. 3 assets in this Trust, were they used at any stage to 4 guarantee or to back a loan taken out by you here in 5 Ireland? 6 A 7 214 Q Not at all? 8 A Not at all. 9 215 Q Well in that case it concerns me Did the Trust or the No. When you were advised about the setting up of this 10 Trust, were you advised that you could, during your 11 lifetime, use the funds that were in this Trust by 12 any means whatsoever? 13 A 14 216 Q 15 A 17 217 Q 18 A 19 I think so, yes. No distributions whatsoever have been made? I don't know, it is not something I pay particularly much attention to or is a very significant amount. 218 Q 21 You don't know anything about it. Does Ansbacher send you statements about it from time to time? 22 A 23 219 Q 24 A 25 26 So the funds were put into the Trust and there they stay to this day, is that the way it was? 16 20 No, not that I am aware of, no. Not really, no. So how would you find out what state things were in? I don't believe this Trust did anything of much significance so I don't think I had any reason to. 220 Q 27 When you say "it didn't have much significance", what do you mean by that? 28 A 29 221 Q I am not sure it did anything much of anything. But it holds assets presumably? 1 2 222 Q 3 It would have held assets. Does that mean it no longer does? 4 A 5 223 Q No, it probably still holds assets. You told us that when you first made contact with 6 Ansbacher it was done really to introduce you to 7 Ansbacher, to the Bank itself? 8 A 9 224 Q 10 A 12 225 Q 13 You were at this stage in the Yes . And did you know Mr. Reid before you went to the States ? 14 A 15 226 Q 16 A 17 227 Q 18 Yes . I see. Was he your tax adviser here in Ireland? Yes he was. Did he continue to be your tax adviser when you went to the States? A 20 21 How did that arise? States; is that correct? 11 19 Yes . Not as much but, certainly yes he did, I suppose, to a certain extent. 228 Q 22 He advised you in relation to United States Revenue law, did he? 23 A 24 229 Q 25 A No. So, what, to Irish Revenue law? He didn't really have much to do with it. I think 26 when I went after the 4 years, when I wanted to make 27 investments, 28 230 Q 29 A I went to Don Reid. After what 4 years? Well my investments were blocked, my assets were 40 1 2 231 Q 3 A 4 232 Q 5 In Ireland? Yes after I left. Yes, so your assets were here. Ireland were blocked; is that it? 6 A 7 233 Q 8 A 9 234 Q Assets in Ireland were blocked, yes. For 4 years? Yes . JUDGE O'LEARY: 10 This was for Exchange Control purposes? 11 A 12 235 Q Yes . MS. MACKEY: 13 And at the end of those 4 years, you asked Don Reid 14 15 Your assets here in for advice? A 16 I am not sure when I actually went and asked him for advice. 17 236 Q 18 A 19 I don't have a timescale of it all. And what did he advise you? He recommended that I talk to John Collins in Guinness & Mahon. 20 237 Q 21 A I think it was all Guinness & Mahon in those days. 22 238 Q It was called Guinness Mahon Cayman Trust, that is In Ansbacher Cayman? 23 correct, but it was the Cayman Bank we are talking 24 about? 25 A 239 Q So he put you in touch with Guinness Mahon Cayman Trust the Bank in Cayman with John Collins there? 28 29 I never had any dealings whatsoever with the Irish Bank. 26 27 Yes, it was the Cayman Bank. A 1 2 I mean, you told us you didn't have deposits with 3 them until 1990 but what was the nature of your 4 business with them at that stage? 5 A 6 241 Q 7 A 8 242 Q 9 I took out a loan. With Ansbacher? With Ansbacher, yes. But was it not in connection with the transfer of your assets from Ireland that you were getting in 10 11 It would have been for loans. touch with Ansbacher? A I don't think so, no. Almost everything I did, I 12 did in my own name. 13 don't know that it was used for anything. 14 243 Q 15 I probably formed a Trust but I The assets that you had in Ireland, were they transferred to Ansbacher at that stage? 16 A 17 244 Q 18 A No. They were not? No. I mean this Trust was formed. I don't think 19 over the years that anything ever happened to it. 20 This company became more active in the last few 21 years. 22 245 Q I am getting confused now. 23 the time of your 24 Trust was then formed? 25 A 26 27 first contact with Ansbacher, the I can't recall when the Trust was formed, I don't know when it was formed. 246 Q 28 29 Are you saying that at Really what I am trying to tease out here is what the nature of your first contact with Ansbacher was? A It was in connection with a loan. 1 247 Q 2 A 3 248 Q 4 5 A No, no, it was purely a loan for an investment I was making in America or as a partnership over there. 249 Q 8 9 There was no question of a deposit or a Trust at that stage? 6 7 Yes . And this was as a result of Don Reid advising you to do that? A Yes. Basically it was to do with rates of interest. 10 They had more competitive rates of interest than 11 were available in the United States. 12 250 Q 13 A I see . So that really all came about because I wanted to 14 borrow some money. 15 the old connections and see what was available and 16 it came up that he recommended John Collins and they 17 organised it. 18 251 Q I thought I would go back to And it was through John Collins then that your 19 connection with Guinness & Mahon in Dublin came into 20 being? 21 A Yes, everything basically came through John Collins. 22 252 Q Can you tell me why John Collins advised you to take 23 24 loans out in Dublin? A No I have no idea. As far as I was concerned it was 25 all the one company and I don't know why they did it 26 in Dublin rather than somewhere else. 27 253 Q 28 A 29 254 Q Rather than in Ansbacher Cayman itself? Yes . 1 you gave evidence to me 2 that the money which you ultimately put in the 3 Caymans, I suppose which really I am not concerned 4 about at all, but it was there and it was in 5 Ansbacher and because it was Ansbacher, the way in 6 which Ansbacher dealt with the matter is of concern 7 to me? 8 A. 9 255 Q. 10 Yes. That that was never used as a security against a loan in Dublin; is that correct? 11 A. 12 256 Q. 13 A. 14 257 Q. Yes, sorry -­ Is that the evidence you gave? Say that again. That the money which you had in Ansbacher from 1990 15 on, or sometime around then, that that had not been 16 used as security for a loan in Ireland? 17 A. 18 258 Q. 19 A. 20 259 Q. 21 A. 22 260 Q. 23 A. 24 261 Q. 26 A. 27 29 It was? Yes. And was that hidden? No. How do you mean "hidden"? For that fact to be hidden? No, there was absolutely no reason for it to be hidden at all. 25 28 It was used as a security for a loan in Ireland. Well, of course -­ It is perfectly open and legitimate. There was absolutely no reason whatsoever to hide it away. 262 Q. Why then was the facility letter to you from Ansbacher Cayman specifically not to include the 1 2 I don't know the answer to that. 3 absolutely no reason why they shouldn't have had it. 4 It may be something that they may have wanted to do 5 for their reasons, their practices, but it is not 6 something I requested them to do. 7 absolutely no reason why anybody shouldn't know I 8 had a deposit because I was a non-resident in the 9 United States and in Ireland and there is no tax 10 11 There is There is payable on that deposit. 263 Q 12 But when were you a non-resident in the United States ? 13 A In June 1990 before those two loans were taken out. 14 264 Q And the purpose of those loans, part of the purpose 15 of the loans was to? 16 A 17 265 Q Real Estate investment in the United States. In the United States and for tax purposes. There 18 is nothing wrong with that but it was to sort out 19 tax affairs as well, wasn't it? 20 A 21 22 It is all part of the overall involvement of an investment. 2 66 Q I see, and in those circumstances you are saying 23 that it wasn't at your request that the backing of 24 this loan was kept secret? 25 A Absolutely yes, absolutely. There was absolutely no 26 reason to keep it secret. 27 But wouldn't you have had a continuing tax liability 28 in the United States? 29 No. When I became resident in the United States I 1 had no future tax liability on any deposit interest. 2 Exactly the same as if I had money sitting in 3 Ireland in any bank or any bank anywhere in the 4 world. 5 tax on deposits. As a non-resident, you are not liable for But were you a citizen of the United States? 6 268 Q 7 A 8 269 Q Never a citizen? 9 A I was a citizen. 10 270 Q 11 A 12 271 Q No. When did you cease to be a citizen? About the same time, June 1990 I gave it up. Doesn't the tax situation in the United States mean 13 that even though you yield up your citizenship, you 14 continue to have some continuing liability for some 15 time ahead? 16 A No I believe they have changed the law and I gave up 17 my citizenship because people were giving up 18 citizenship for tax reasons. 19 understanding at the time I gave up my residency, 20 citizenship there was no tax liability in the United 21 States. 22 272 Q But it is my And the money that was used to back those loans 23 which you took out in June 1990 was on deposit in 24 Ansbacher? 25 A 26 273 Q 27 A 28 274 Q 29 A Correct. And how long had it been there? It was put in there for the security for the loan. How long had it been there was the question? 1 275 Q 2 A At the same time as the loan was, it was part of the 3 security for the loan. 4 the property and a deposit. 5 276 Q And that was the first time you had a deposit with Ansbacher; is that correct? 6 7 A 8 277 Q 9 10 They required security for Yes . But had you already got a Trust in Ansbacher at that stage? A I formed a Trust but I don't know when that was. 11 Whether that was before 1990 or after 1990 I just 12 can't recall. 13 it But certainly if there was a Trust, certainly wasn't active. 14 278 Q 15 A Yes I am sure I can. 16 279 Q Can you let us know? 17 A 18 280 Q Can you find out when you formed the Trust? Yes . MS. MACKEY: Are you familiar with a 19 company called Deltona 20 Investments, Mr. Enoch? 21 A 22 281 Q 23 A 24 282 Q 25 A 26 283 Q Yes . What was Deltona Investments? It was a partner in Girard Investments. Yes but what was it as a company? What do you mean "what was it?" What did it do? Who were the beneficial owners of 27 the company? 28 That is something I can't answer who the owners 29 were. Who were the shareholders? What it did was it purchased property which I 1 2 3 A. 4 2 85 Q. No, not at all. JUDGE O'LEARY: But you didn't know with 5 whom you were doing 6 7 business, it was just a company? A. I wouldn't say that, no. I believe it is possible 8 that John Collins, it would seem to me, was the man 9 who was running it. 10 28 6 Q. MS. MACKEY: But you don't know who the 11 shareholders were? 12 A. 13 287 Q. 14 A. 15 288 Q. The shareholders, no. You don't know at all? That is your evidence? No. JUDGE O'LEARY: 16 The loan in June 1990, Mr. Enoch, is the reality of 17 what happened on that occasion in respect of loan 18 number one, which was for $900,000, is that you 19 borrowed that in Guinness & Mahon and the same 20 $900,000 was put on deposit in Ansbacher? 21 A. 22 289 Q. 23 A. 24 290 Q. Yes. Well that is what happened? Yes. We would have saved a lot of time if you told us 25 that originally. 26 you put it on deposit in Ansbacher? 27 A. 28 291 Q. 29 So you borrowed the $900,000 and Yes. And you borrowed $400,000 and did the same? 1 2 I am not suggesting whether it was legal or not; I 3 am merely saying that I want to know what is going 4 on. 5 want to know anything about your affairs, 6 want to know what the company were doing. 7 all. 8 company were doing and volunteered that, we would be 9 out of here long ago? 10 A 11 293 Q That's all and I want to go on not because I I just That's If you answered me by telling me what the I didn't know you wanted to know that. That's what I want, but I was asking you about the 12 money and you were saying "money was being put on 13 deposit" when in fact it was the same money. 14 is nothing wrong with that. 15 you for that but at least I know it now? 16 A 17 There I am not criticising Okay. MS. MACKEY: 18 I haven't any further questions, Mr. Enoch. JUDGE O'LEARY: 19 I think I may have one more question. 20 21 22 Can I take it that in respect of the $900,000 which 23 was borrowed from Ansbacher or from Guinness & Mahon 24 and put on deposit in Ansbacher, that that $900,000, 25 the interest on that was a legitimate charge against 26 whatever profit that there was on the property in 27 the United States? 28 29 A The loan? 1 2 Can I also take it that it was your advice at the 3 time that the interest on that loan, if you like, 4 the backing loan, was not returnable by you in the 5 United States? 6 A 7 296 Q 8 A 9 297 Q 10 A Correct. And was not returnable by you anywhere? Correct. That is actually very simple? Very simple. It is absolutely simple and perfectly 11 legal. 12 even asking me a lot of these things because, as I 13 have said in my letters all the way along through 14 that I have been corresponding with you, what I did 15 was perfectly legitimate. 16 298 Q 17 A 18 299 Q 19 A 20 300 Q 21 22 This is why I don't understand why you are And for how long did you own that $900,000? For 4 years roughly. Until 19? 1994 . And where were you living during that period of time ? A My home was in Spain. When I left the United States 23 I went to live in Spain, but basically I am retired 24 and I just travel around a lot. 25 like, of operations was in Spain. 26 place I have a home. 27 301 Q 28 A 29 302 Q My base, if you That is the only And you have lived in Spain since? Correct. You know nothing about the Tabmount Corporation you 50 1 2 3 I have no involvement, no. 303 Q 4 You were not aware that it had a cash-backed loan as well? 5 A 6 304 Q 7 A No, I have no involvement whatsoever. You don't know where that cash backing came from? No. I may have seen documents about it like these 8 today. 9 ones or not. 10 305 Q I don't know whether I have ever seen other MS. MACKEY: Mr. Enoch, after you went 11 to live in the States, did 12 you continue to have income whose source arose in 13 the United States? 14 A 15 306 Q 16 After I went to live there? After you went to live in Spain, after you gave up your United States citizenship? 17 A 18 307 Q 19 Yes . Were you required to file tax returns in the US in respect of that income? 20 A 21 308 Q 22 A Yes . And how long did that continue for? I am not actually sure but certainly I would have 23 filed tax returns in 1990. 24 that. 25 309 Q Did your income continue to arise in the United 26 States for some years? 27 that you had there? 28 29 A I don't know after Yes. Did it arise from property It is possible up to 1994 because in 1994 I disposed of all the property there. 1 310 Q 2 A 3 4 no tax returns. 311 Q 5 A 7 312 Q 9 So up to 1994 you would have had the obligation to file tax returns? 6 8 Yes. Certainly after that date there would have been Yes I think so. Thank you. JUDGE O'LEARY: Thank you very much. There will be a transcript 10 of the evidence adduced and we would wish that you 11 would sign it as being correct. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN TERMINATED Nowd CLme douchm VMLEN oom?uer 0\ > Jl« MLOK/CC . December 1989. Ansbacher Limited, P.O. B o x 8 8 7 / Grand Cayman/ British. W e s t I n d i e s . D e a r Sirs, ANSBACHER LIMITED A N N E E N O C H TRUST TABMOUNT G I R A R D INVESTMENTS LIMITED We refer to ou r le tte r of 16th November and enclose amended schedule to i n c l u d e prop er ty at 7874 Girard Avenue. Yours faithfully, f o r Gftattfess & M A H O N L I M I T E D . M. L A N I G A N - 0 'K E K F F E JOINT MANAGING DIRECTOR. 7874 Girard Avenue 2) Agreement Between v. Knoctv, 'Stephen Enoch and Deltona 'Securities Ltd. and {GHCT Ansbacher Ltd. 3] Deposit of $1,250,000 by Ansbacher Ltd, with G.M. Dublin. ■ T f t f t -M O U N T CORP.. LOAN Oct. 12, 1989 for 5 years $1,550,000_ A nnual R e vie w . 1) Deposit by Ansbacher Ltd. • with G.M, Dublin (Back to Back) • for; $1,530,000. .2) Dead of Trust and Assignment of Renta over Property at 100S prospect Reef, La Jolla, San Diego. j) Promissory Note. TftBrMQUHT-CQRP-. $3,000,000 • 31/12/1986 for S years. Annual Review. 1) Deposit Ansbacher with GM Dublin $2,900,000 (Back to,Back). dL2) Guarantee $100,000 from Ansbacher Ltd. . 3) Deed of Trust and Assignment of Rents - 95S-.Prospect, shopping Center, La Jolla, San Diego aXRARH_I®ESlMEHTajU2Iix $1,250,000 ' . 30/6/88 to 30/6/90 1) Deed of Trust and Assignment of Rents over properties at Shopping Center - La Jolla, San Diego 7868 Girard Avenue Avenue TV ANNE ENOCH TRU8T TAB-MOUNT CORP. LOAN $1,5 50 ,0 00 SECURITY TERM O c t. 1 2 , 19 8 B fo r s Y ears X) D e p o s i t b y A n s b a c h e r L i m i t e d w it h G .M . D u b lin (B a c k t o B a c k ) f o r 0 1,5 5 0 ,0 0 0 . A n n u a l R a v ie v i. 2) D eed o f T r u s t an d A s s ig n m e n t o f R e n t s o v e r P r o p e r t y a t 10 0 S P r o s p e c t R e e f , L a J o l l a , S a n D ie g o . 3) ' P r o m is s o r y N o t e . TAB-MOUNT CORP. $3,000,000 3 1.12 .19 8 6 fo r f o r 5- Y e a r s 1) D e p o s i t A n s b a c h e r w i t h OM D u b lin $ 2 ,9 0 0 ,0 0 0 (B a c k t o B a c k ) . A n n u a l R e v ie w 2) D eed o f T r u s t and A s s ig n m e n t o f R e n t a 9 5 5 p r o s p e c t , s h o p p in g c e n t e r . L a J o l l a , S a n 'D ie g o . 30 /6 /B B to 3 0 / 6 /9 0 1) D eed o f T r u s t and A s s ig n e m t n o f R e n t s O ve r P r o p e r t i e s a t s h o p p in g C e n t e r - L a J o l l a , S a n D ie g o 786B G i r a r d A v en u e 7 8 7 0 G i r a r d A v en u e 7 8 7 2 O ir a r d A v en u e 7 8 7 4 G i r a r d A ven u e 2) D e p o sit o f $ 1,2 5 0 ,0 0 0 by A n sb a c h e r L t d . w it h G.M . D u b lin . GIRARD INVESTMENTS LTD. $1,2 50 ,0 00 f, I t i r* Hr. J.D. Traynor, 42 FitzsrWiam Square, Dublin 2. Dear Das, • )' Re: BBSLBEUX , 1 refer to *y latter o f Sapteabar 16th and pravlou* correspondence. Manl Hani haw m i u t a d that 1 obtain - If poiilbl* cheques referred to in John Collins lattar of frly 11th,; should be avallabia fran tha Bank In California. They ara point. ^Kindest regards. Yonrs sincerely, H I Davra Htnnpnnas S e n io r Manager, O perations of tha TAB MOUNT CORPORATION Tab Mount Corporation is a US property company owned by Tablemount NV, which is in turn owned by a number -of trusts the beneficial owners of which are, Mr. Victor Enoch, his son, Mr. Stephen Enoch and other family members. Related facilities are as follows: Mr. & Mrs. Stephen Enoch USD 900/000 Mr. Stephen Enoch USD 400,000 ‘ Girard Investments USD 1,250,000 Martina Investments . * IRP 310,000 • ' . ' I— 99% syndicated — * -,100% cas.h ,. . secured G&M has two facilities outstanding1to Tab Mount Corporation which were advanced to finance the purchase of investment property at La Jolla, San Diego, Califomia: Facility 1. ‘ ' USD 3,000,000 ’ ' . . ' .. . facility 2. This, loan was originally provided in 1986 for a five year period and extended for a further five year period to 31/12/96 in March 1992 (see Minute Number 92/136). . • USD 1,550,000- . This facility was originally provided in October.1988 for a five year term to October 1993. The clients have requested extension of Facility 2. for a further five year peiiod to 31/10/98 under the same terms and conditions as before. • Facilities are sub-participated to CIBTC Ltd to the extent of 99% leaving a net exposure to Tab Mount of $45,500 $30,000 in respect of Facility 1. and $15,500 in respect of facility 2. Security for the facilities consists of a fixed charge over the otherwise unencumbered commercial property at La Jolla, believed to be worth in the region of USD 6,000,000 together with a guarantee from CIBTC Ltd for USD 4.5,500 i.e. our full exposure. A funding deposit for the net exposure is held by CIBTC. • The facilities have operated satisfactorily to date with interest being paid bi-monthly from rental income. The Enoch family have been clients of GSM since the early 1980's and have built a significant property portfolio in San Diego, California since they emigrated to the US 10 years ago‘ A p p r o v a l o f f i v e y e a r e x t e n s i o n is r e c o m m e n d e d . : .•! »V/- & FC/MC 8/10/93 M r S t e ph en M. Enoch, 1356 Virginia Way, L a Jolla, Califo rni a 92037, USA. De ar H r Enoch, ■ • • I refer to your r ecent correspondence and our telephone ' . conversation regarding th e cheques yo u forwarded to Manufacturers -Hanover Trust,’which were not handled in the u s u a l way. . ' •. I have had the p r o b l e m followed u p with their H e w York office and unfortunately they are unable to explain w h i c h department m i g h t have returned th e cheques to you. However', they have indicated that y o u should send cashiers' cheques only to Manufacturers H a no ver Trust, 4 Kew York Plaza, 13th Floor, Funds Transfer, N ew York, NY 10004-. They also requested that t he cheques be made p a y a bl e to Manufacturers Hanover Trust Account, Guinness & M ah o n Limited and hopefully, w i t h future • remittances to o u r account you should not have any p r o b l e m s . They indicated t h a t their preference would be'to receive funds electronically, transferred, quoting the Funds Transfer Section, .but t h e y did say that the processing of cashiers' cheques does n o t cause them any problem. . I f you have any difficulties at- all when the ne xt payments occur, please do n o t h es i t a t e to contact me. . Thanking you, Yoi :erely. Chris Waite, Assistant Banking Manager 'T" i TAB MOUNT COHPORATTOW . Tab Haunt Corporation is owned by Tablemount NV. The latter i; in turn owned by a-number of trusts of which the beneficial owners are Victor and Stephen Enoch and other family members. The Enochs were originally clients of Guinness Mahon Cayman Trust, now Ansbacher Cayman. They were introduced to G&M in the early 1980's by Don Held, the retired Senior' Tax Partner with KPMG Stokes Kennedy Crowley. • ' c: I ‘ . \ f v The Enoch family were resident in Ireland where thfey owned substantial, property.and. a TV. rental business until emigrating to the US in the early 1980's. In the interim the Enochs have built up a sizeable property portfolio in La Jolla, San Diego, California. The property purchases were largely facilitated by loan facilities provided by GSM, which are tax efficient for the Borrowers. The facilities included loans to Mr. and Mrs. Stephen Enoch (net exposure (US$13,000] and a related company Girard Investments (net exposure US$12,500). In all cases the net exposure is guaranteed by Ansbacher Ltd. • TAB MOUNT LOANS The Tab Mount loans (net exposure US$46,000) are secured by way of a fixed charge over fully let commercial property in La ‘ Jolla, recently valued at .US$6m. In addition, we hold the guarantee of Ansbacher Limited for US$46,000. ' ‘ The loans were each provided in December i.986 and October 1988 respectively, for a five-year term, subject to annual review. We have now been requested to renew the first loan, subject to the same conditions for a further period of five years (maturity 31.12.1996). It is proposed for convenience to tie-in the annual review dates for both loans in future at 31st December. '■ ' ' RBfraflfflHPAgTON The Enochs are longstanding, satisfactory clients of Ansbacher Cayman and G&M. Approval of the proposed five year extension is recommended. ’ * t CL/MEC <5/•* /QO •jSr*' \\.\l I*' .:..i.i ..kt»\ !•>««J' • :iniuM JR/CC ' 13th June 1990. Mr. Stephen Enoch; 1356, Virginia Way, La Jolla, ‘ California 92037, U.S.A. Dear Mr. Enoch, . We refer to recent discussions and are pleased to confirm the basis on which we are prepared to provide a loan facility of US$400,000. . Borrower: Mr. Stephen Enoch. Amount: . US$400,000 (Four Hundred Thousand United States Dollars)r ' Purpose: The loan is being provided in connection with the financing of your Interest in properties owned by Girard Investments at. La Jolla, California, consisting of 7868-7874 Girard Avenue. ’ ■ Terra: In accordance with normal banking practice, the loan is repayable on demand but in any event no later than 30“fch June 1992. In the event of your requesting an extension of the loan at the end of this period, we shall give due consideration to your request at that stage. . Interest: Interest will be charged on the loan account at a fixed rate of 12%. Interest will be debited to the loan account on the 30th June and 31st December annually and shall be Immediately payable. Drawdown: The loan will be available for drawdown when all formalities in connection therewith have been completed. Drawdown will be by.way of loan account in the borrowers name. The loan proceeds are to be paid to Bank of America, La Jolla, Main Office 0170, P.O. Box 194 7, La Jolla, California ABA No. 122000661 for the account of Mr. Stephen Enoch Account Number 01704-03040. ” I S \ }< « II v i HMVN I ' M K K i s i u m i r..Rs w i M i u i ft*! U M t : fi m .i * in n W H .M O n t.iuiK vuvM m u k t l t t l • SI »\U .i : U I K IK K in k K lif t W P « .!> » . \ tO J IK K . i m tM IR IU " , i >• I * As security for the ioan we shall require:I (i) the completion of a Deed of Trust by Girard Investments over property at Girard Avenue, La Jolla consisting of:- 7868 ‘ - 7870 7872 7874 Girard Girard Girard Girard Avenue Avenue Avenue Avenue ' . owned by Girard Investments, and (ii) . a promissory note signed by the Borrower. Insurances: It is a condition of the loan facility that the properties which are the subject of our security remain adequately Insured by you. The payment of all premiums shall be your responsibility. We shall require sight of the policies. Other Terms and Conditions: It is understood that should circumstances arise whereby interest on the loan.is subj ect to United States taxes,, withholding or otherwise, or.changes in central Bank of Ireland requirements or regulations affecting in any way Guinness & Mahon Limited's profitability on this loan, then on three months notice the borrower shall have the right to repay the loan without penalty and all interest outstanding, or will pay an increased rate of interest to compensate for any such tax liabilities or loss of profitability. 3 W e a r e p l e a s e d t o b e o f a s s i s t a n c e an d e n c l o s e h e r e w i t h a c o p y o f t h i s f a c i l i t y l e t t e r w h i c h s h o u l d b e s i g n e d b y y o u as ev idence o f y o u r accep tan ce of this facility p n the terms set o u t above. W e shall also require the completion of the enclosed Bank Mandate. . Yours faithfully, for GUINNESS & M A H O N LIMITED- J O H N RYALL, MANAGER - BANKING ASSISTANT MANAGER - BANKING Acceptance Th te ' STEPHEN ENOCH . ~ ....... ~ * - ■ -■■ te£ Qn tke j.j.x Uia nffuxwiiAVii i ;naxjj.± A tL*t: , r * M i n u t e No: G . & H. D u b l i n / ^ tfgtrfXg/2ifgHEX!SB/gB]atfgTZ0M/XMglMI!afiC: BORROWER: Amount: Date: Credit Class Sati s f a c t o r y Stephen Enoch US$400,000 PROPOSAL & PURPOSE O P FACILITY(S) : T o e n a b l e Mr. E n o c h t o r e a r r a n g e his tax af fa i r s f o l l o w i n g c h a n g e o f r e s i d e n c e - Mr. E n o c h i n t e n d s t o c h a n g e h i s p r e s e n t U S t a x r e s i d e n c y . Se e attached note. ' Source of Repayment, Repayment Programme & Final Maturity: Tw o y e a r facility - s u b j e c t to annual review - 30.6.9B l ~ B a n k ' s I n c o m e ( i n c l u d i n g R e t u r n o n Capital):' o v e r rate paid o n B a c k i n g deposit. No use o f Capital ■ ° 'urity and Security Margin: ■ “ “ f e t t e r o f S e t Off- s i g n e d b y A n s b a c h e r L i m i t e d o v e r D e p o s i t s t o t a l l i n g L .^y4 00,000 • * , 2. C h a r g e o v e r Mr. E n o c h ' s 1 / 3 i n t e r e s t i n G i r a r d I n v e s t m e n t s - v a l u e o f i n t e r e s t is c.' U S $ l m . O t h e r -C o n d i t i o n s P r e c e d e n t : O t h e r I n f o m a t ion: : . . B A N K ' S R I S K E X P O S U R E - A g g r e g a t e ( i n c l u s i v e o f t h i s p r o p o s a l ) to: Customer Related Customer Total U S $ 7 , 5 0 0 ,000 US$400,000 Committed/Limit: US$7,900,000 Balance: US$5,800,000 US$5,800,000 C o u n t r y Ri s k : Country of Primary Risk:USA P r i m a r y Risk: Limit: Secondary Risk:USA Coxrant: D o m i c i l e :U S A Drawn: .or R i s k : beetor: Limit: G M B u s i n e s s S e c t o r :P e r s o n a l CBofI B u siness S e c t o r : 10.5 Commt: Risk Asset Weighting:No use of Capital Drawn: R e c o m m e n d e d by: J. R y a l l I n t r o d u c e d by: J.D. T r a y n o r Decision: Credit Committee Chairman M i n u t e No: Minute N o : Dublin Board /CC . Date: GM&Co. Date: PROMISSORY NOTE I, Stephen Maurice Enoch, c/o P.0> Box 465, La Jolla, California, USA, hereby promise to pay to Guinness & Mahon Limited of 17 College Green, Dublin 2, Ireland, the sum of FOUR HUNDRED THOUSAND United States Dollars (U.S. $400,000) together with interest thereon at the rate of twelve per cent (12%) per’annum, payable half-yearly with the principal and any unpaid interest to be paid on the 30th June, 1997. . All payment on account of principal and interest in respect of this loan shall be effectively made to Guinness & Mahon Limited without set-off or counterclaim, free and clear of, and without deduction for or on account, any and all present and future stamp taxes, levies, imposts, duties, deductions, withholdings, reserves.or other charges or whatsoever nature, imposed, levied, collected, withheld or assessed by any Government or any political subdivision or tax authority thereof. . * « , This Note may be prepaid before the due date but a prepayment fee equal to 4% of the principal amount shall be added to such prepayment. . This Note is not negotiable and any holder shall take this Notice subject to all claims, defense, and rights of set-off which may exist any any time; SIGNED SIGNED i A t n TO: GUINNESS & MAHON LIMITED 17, C o l l e g e G r e e n , D u b l i n 2. . tan D a t e : ....... Fr?.T . . '?.?< W e h ereby authorise and empower you p e nding payment o f any overdrafts, loans or advances in respect o f which MR. S T E P H E N E N O C H m a y b e l i a b l e t o y o u , e i t h e r s o l e l y o r j o i n t l y w i t h o t h e r s , as principal' or surety, o r in any other m a n n e r whatsoever; and n o t w i t h s t a n d i n g that any such liability m a y be current, to hold all monies w h i c h n o w o r hereafter may stand to our c redit with G u i n n e s s & M a h o n L i m i t e d i n A / c No. 1 7 5 1 0 2 3 6 t o g e t h e r w i t h i n t e r e s t t h e r e o n as s e c u r i t y f o r al l s u c h l i a b i l i t i e s . Furthermore, you are authorised to set-off and apply such monies o r any. p a r t t h e r e o f f r o m t i m e t o t i m e i n o r t o w a r d s s a t i s f a c t i o n o f s u c h liabilities en tirely at your own di scr e t i o n w i t h o u t f u r t h e r n o t i c e t o us . W e also agree that such set-off will be a good and valid d i s c harge o f such monies so applied w i t h o u t the n e c e s s i t y o f any further endorsement or authorisation from us w h a t s o e v e r a n d t h a t w i t h o u t r e q u i r i n g a n y .f u r t h e r c o n s e n t f r o m us y o u m a y vary, exchange, abstain from p e r f e c t i n g o r r elease an y o t h e r securities hel d n o w or to be held h e r e aft er by you on a c c o u n t o f t h e monies* h e l d n o w o r to b e h e l d h e r e a f t e r b y y o u o n account o f the monies intended to be hereby s e c u r e d . . F o r a nd o n b e h a l f o f ANSBACHER LIMITED • O ' Mr Stephen Enoch A. NAME: B. * FAC11.JTY: C. REVIEW. DATE: 30/6/94 D. SECURITY 1. P r o m i s s o r y n o t e s i g n e d b y t h e B o r r o w e r t o g e t h e r w i t h a D e e d of Trust by Girard Investments over p r o p e r t y at. G i r a r d A v e n u e , L a Jolla, c o n s i s t i n g of:- U S $ 4 0 0 , 0 0 0 .s u b - p a r t i c i p a t i o n b y C a y m a n International B a n k (formerly A n s b a c h e r Ltd) C g r U S S 3 9 6 , 0 0 0 . N e t lo an h e l d b v G & M USS~4.000;___________ HELD: 7868 7870 7872 . 787'4 w Girard Girard Girard Girard Ave. Ave. Ave. Ave. 2. G u a r a n t e e f r o m C a y m a n I n t e r n ational B a n k Cor US$4,000 (Incorporated into Trust E. S E C U R I T Y C H E C K E D TO REGISTER: Yes F. SECURITY PACKET: G. ACTION T A K E N ON O U T S T A N D I N G ITEMS: N/A I!. COMMENTARY: C H E C K E D TO Yes 4 ‘ ‘ T h e f a c i l i t y w a s o r i g i n a l l y p r o v i d e d i n J u n e 1 9 9 0 to. f i n a n c e M r E n o c h ' s interest- in p r o p e r t i e s , o w n e d b y G i r a r d I n v e s t m e n t s a t L a Jolla, California. M r. E n o c h w a s o r i g i n a l l y a c l i e n t of G u i n n e s s M a h o n C a y m a n T r u s t ( n o w C a y m a n I n t e r n a t i o n a l Bank) a n d w a s i n t r o d u c e d to t h e B a n k i n t h e e a r l y 1980's. T h e facility h a s o p e r a t e d satisfactorily s i n c e inception with G & M receiving an a n n u a l m a n a g e m e n t fee of 0.5% of t h e facility (US$2,000). U l t i m a t e m a t u r i t y of t h e facility is, 30/6/97. ^ /''J ----- - Noted b y FC/MC 9/7/93 Credit Committee Date ML01C/MHC 1 4 t h June 1990 Mr J D Traynor Ansbacher Limited 42 F i t z w i l l i a m S q u a r e DUBLIN 2 Des STEPHEN. E N O C H A N D A S S O C I A T E D L O A N S Re I am enclosing for your attention 1. 2. 3 . C o p i e s o f t h e F a c i l i t y L e t t e r s t o S t e p h e n E n o c h and t o M r and Mrs S t ep he n E no ch in respect o f the n e w advances o f $400,000 and $900,000. T h e s e h a v e b e e n f a x e d to C a l i f o r n i a a s re qu ested,, a n d t h e o r i g i n a l s w i l l b e . . forwarded to Clonskea. . Letters o f Set-off.tq be signed on b e h a l f o f A n sb ac he r co v e r i n g t h e - b a c k i n g deposits. I have taken the o p p o r t u n i t y o f e n c l o s i n g t h e s e f o r Giirard a n d T a b m o u n t ■ as w e l l a s f o r t h e t w o n e w l o a n s . A copy o f t h e Letter of Extension for the loan of $1.25 m i l l i o n to G i r a r d Investments. I t r u s t th a t this is a l l in o r der Kind regards. ; _ O'Keeffe *« lit I H .t I.KI I N *1 IS - :i11 JR/CC - 1 3t h J u n e 1990 Hr. S t e p h e n E n o c h , 1 3 5 6 , V i r g i n i a Way, La Jolla, C alifornia 97037, U.S.A. . •**•.‘if? Dear Mr. Enoch, . • . W e a r e f a x i n g w i t h t h i s l e t t e r c o p i e s of' f a c i l i t y l e t t e r s as f o l i o w s :■ , (a) • Girard investments - Extension of existing loan of US$1,250,000. . (b) S t e p h e n Enoch - US$400,000. N e w Loan facility. (c) Mr. & Mrs. S t e p h e n E n o c h - U S$900,000. facility. New Loan The originals together with Bank Mandates are being sent to c/o M rs . E n o c h , Y a l e 2, A r d i l e a , R o e b u c K R o a d , D u b l i n 14. I u n d e r s t a n d t h a t y o u will be in Dublin o n 1 7 t h June. W e would be h a p p y to m e e t y o u on 18th June if you are still in Dublin. O the r w i se , I w o u l d b e g r a t e f u l if you c o u l d send, b y post, the completed documents to the undersigned. ' Many thanks. - Yours sincerely, for G U I N N E S S & M A H O N LIMITED. MANAGER - BANKING. I ,\ M M I IIVKII'! I* tillt MimumvsN rUHinn mikihmim mcet-n .,.,.,.,,1 , 1 , ..in, u i n m i ; I'lMut in h-n (I Ivikmw •(mi»>\n.r in i V . U n \ ««"«.!%«* M i N ) \ ) ( l M U I HKIC l.mi'.MLl. M tfttV f \ l> 5% i a ?1 i S t e p h e n M . E n o c h X39A V IR G IN IA WAV L A J O L L A . C A L IF O R N IA (W037 inio*4a#-ffT74 $1CL o >**j T O F *£el>/KjO -^" V v 7 2 3 ”7 7 fe* ^ct,o--J'T. (. \ . • ’ ■ ’ ^ 2^) . J ’/ 2rP/^V- /^- ^ . S V D >lhu G\iaifeis r t a h u - ■ ' i t t a i v K . \(ou. , 0 0 1 3 3 2 6 0 2 9 B ank o f A m e ric a ■*"** CASHIER'S C H E C n-as/i VOID AFTER SIX MONTh ^ tk^ ^ «*»M AN U?ACT»S?:S HANOVER TRUST COMPANY.................. .. if. 'J ! >S t ......... STEPHEN ENOCH ■ A* ^ / 7 Tn •—>.oaft*»i$* *2 6 . 6 6 6 . 6 7 • * • • ^ 0w»—» hm _c-jr&imntNvnt \CP>7 "TO pft ✓n . . it / a ^ / a n mnaUTlSA.Sinf n m m CmUo m ]h«sgnaiutMi ntOUMff^ amouns ai«r UOaCOO . •*00 13 3 2 6 0 2 3 “* i: I a I 0 0 0 3 5 a « : ;3*i?3»flitO 13H* 0 0 1 3 3 2 5 5 7 2 BanV o f ,' m eriSa "T“ * ■: • C A S H I E R ' S CHEClt ivasm VOID AFTER SIX MONTH •'€& - MANUFACTURES HANOVER TRUST Pay to S te p h e n PonjtwrNvr* E noch ^//Z/h\S> A rV - i/ f T o Ate. H S U W 7 Z J 7 7 1 b iinioiAiMaMmtoiftOTwaCtitiw * 0 0 1 3 3 2 5 5 ? 2“* $ . 1 2 1 0 0 0 3 5fl«: fco »pn«unM /w»u»»tf ter amounts oner SSOQOOO 13*3 7 3»fii.O 1 3** 0 0 1 3 3 2 6 0 2 8 m CASHIER’ S CHECb B ank o f A m e r ic a M T41U 1V3S/1? VOID AFTER SIX MONTH. ^ ^ tk. o^ 1 1 /23/90 J»»»»M A N U FA C TU R ES HANOVER TRUST COMPANY.* 070 Ufsnfe ftfciliR*?)ca: 1 3 cJ ? 3 ‘«fii.O 1 3«* Appendix I. ANSBACHER LIMITED “ SUBPARTICIPATION ACCOUNTS - US DOLLARS AT AT 1ST JULY 1991 Rate Subparticipation Account 1,250,000.00 10.625 Girard Investment Syndication Participation Account 17510001 X V rincipal Loan Account Balance USS lirard Investments Ltd >3152001 -7< Balance 1,237,500.00 X X Rate 10.625 V Tab Mount Corp Ho. 1 Account 10690018 3,000,000.00 10.000 Tab Mount No.l Syndication Participation Account 17510003 2,970,000.00 10.000 Tab Mount Corp No. 2 Account 10690019- 1,550,000.00 10.000 Tab Mount Corp No. 2 Syndication Participation Account 17510004 1,534,500.00 10.000 >< X X X X Hr. Stephen Enoch 12670001 400,000.00 12.000 Stephen Enoch Syndication Participation Account 17510006 396,000.00 12.000 Hr—Stephen Enoch 900,000.00 12.000 . Stephen Enoch . Syndication Participation Account 17510007 _ 891,000.00 12.000 1^901 8,480,640.00 8,395,833.60 Funding Deposit Account Ansbacher Call Deposit Account 17510008 84,806.40 10.572 Mr. S t e p h e n E n o c h / P.O. B o x 465, La Jolla, California 92038, USA . D e a r Mr . Enoch, . W e r e f e r t o o u r l e t t e r of 13th J u n e 1990 a n d c o n f i r m t hat w e are prepared to extend your loan facilities of US$400,000 f or a f u r t h e r p e r i o d o f f i v e y e a r s , •s u b j e c t , t o a n n u a l r e v i e w . The . n e w m a t u r i t y d a t e i s 3 0 t h J u n e 1997. • . W e enclose h e r e w i t h a ne w Promissory Note Incorporating the n e w payment date, w h i c h should be signed b y you, the signature d u l y n o t a r i s e d a n d r e t u r n e d to us i n r e p l a c e m e n t o f a l l p r e v i o u s P r o m i s s o r y Notes i ssued b y you in o u r favour. We confirm that on receipt thereof you will be released from y o u r obligations u n d e r all p r e v i o u s Notes. . • A l l o t h e r t e r m s a n d c o n d i t i o n s a s s e t out: i n o u r l e t t e r o f 1 3 t h J L m e .1990 w i l l c o n t i n u e t o ap p l y . W e e n c l o s e a c o p y o f this l e t te r fo r y o u r s i g n a t u r e a n d return, thereby c o n f i r mi ng acceptance of the facilities on the terms a n d c o n d i t i o n s s e t out. Yours faithfully# M. L a n i g a n - 0 ' K e e f f e , Managing Director. . Enc. Acceptance Th e offer of a loan facility b y Guinness & M a h o n Limited on t h e t e r m s a n d c o n d i t i o n s s e t o u t is h e r e b y a c c e p t e d a b o v e . Borrowers* H r S t e p h e n En o c h . Facility; U S $ 4 0 0 / 000 U S $ 3 9 5 / 000 U S $ 4 / 000 Sub-participated to Ansbacher Limited. Net: E x p o s u r e •? Purposes Loan originally advanced to part finance M r E n o c h ' s interest, i n p r o p e r t i e s o w n e d b y G i r a r d I n ve s t m e nt s at La Jolla, C a l i f o r n i a c o n s i s t i n g o f 7868-7874 Girard Avenue. Fee: .25% m a n a g e m e n t f e e r e c e i v e d i n full. Terms L o a n o r i g i n a l l y g r a n t e d f o r a t w o y e a r yoeA»oo J u n e 1990. in L o a n e x p i r e s 30 /6 / 9 2 . Security: 1. Promissory note signed b y Borrower t o g e t h e r with a Deed of Trust b y Girard Investments o v e r n u m b e r s 7868/ 7 8 70 , 7 8 7 2 a n d 7 8 7 4 G i r a r d Avenue. ” I t is a c o n d i t i o n o f t h e f a c i l i t y t h a t t h e s e p r o p e r t i e s b e a d e q u a t e l y i ns ur e d . 2. FC/mhc 30.7.91 G u a r a n t e e f r o m A n s b a c h e r f o r $4/000. Mr. S t e p h e n E n o c h , P.O. B o x 465/ L a J o 1 la> C a l i f o r n i a 92038, US A. D e a r Hr. E n o c h -; ' Girard investments - Loan Number 03152001 S. E n o c h . - Loan Number 12670001 S. & L. E n o c h _______ - L o a n Jtvrmhor 1.2569001 . I w i s h t o a c k n o w l e d g e receipt, o f y o u r p a y m e h t o f U S $ 1 1 7 , 712.84 in settlement of interest for the six m o n t h p e r i o d t o 3 0 t h J u n e 1993/ i n r e s p e c t o f t h e a b o v e l o a n facilities. I nterest f or the s ix months to 31st D e c e m b e r 1993/ w i l l a m o u n t t o U S $ 1 1 8 / 066.06 w h i c h is c a l c u l a t e d as f o l l o w s : Girard Investments $ 1 , 2 5 0 / 0 0 0 f o r 184 days a t 6% S . Enoch $ 4 0 0 / 0 0 0 f o r 184 d a y s a t 12% . $38/333.33 ‘ $24,533.33 S. & L. E n o c h $ 9 0 0 / 0 0 0 f o r 184 d ays at 12% $55/200.00 $118/066.66 Yours sincerely Frances C o l l i n s , Banking Department. GUINNESS+MAHON LTD G+M BANKERS 17 College Green Dublin 2 P.O. Box S5A Tel: 716944 (17 Lines) 9 t h Ju ne, 1982. Girard Investments, 6 7 3 2 D w a n e A v e ., San Diego, California, U. S. A. D e a r S i rs , • W e r e f e r to y o u r a p p l i c a t i o n f o r a l oa n w h i c h w e h a v e c o n s i d e r e d a n d a r e p r e p a r e d to o f f e r o n t h e f o l l o w i n g basis: 1. A m o unt : U . S . $1,250,000.00. 2. Term: 2 y e a r s f r o m d a t e o f d r a wd ow n. 3. Interest Rate: 4. Drawdown: 2$% over Libor 6 m o n t h rate on date of d r a w d o w n a n d t h e r e a f t e r at 2 $ % o v e r 6 m o n t h L i b o r for e a c h s u c c e e d i n g 6 months. •/ . • ■as'V? T o t a l a m o u n t in o n e a m o u n t b y 3 1 s t Jtrly, 1982. 5. Interest Pa ym en t: 6. ' Repayment of Principal: 7. 8. 9. Pur p o s e : Disbursement o f Loan: Security: t “3uW Lpi if-o.c.rJTrt hcj . Qnoi-oiaifS ^a?c>7. To G i r a r d I n v e s t m e n t s A c c o u n t w i t h B a n k o f A m e r i c a , L a J o l l a (full d e t a i l s to b e supplied). F i r s t L e g a l M o r t g a g e C h a r g e o v e r t he Partnership’ s Shopping Centre property in L a Jolla, C a l i f o r n i a , c o m p r i s i n g ; 7868 7870 78 72 7874 M*it, Dublin. T*h»; 2&201 Girard Girard Girard Girard Avenue Avenue Avenue Avenue Non»Ex«cutIv* OfrKiortT) JTO Q uIa i w u ^ • ■ 0 u Ia - - «* mu « • * • • • .4.£Jk.8. GuinAMt, G.S. Hill n pi .« i« Girard Investments. 10. a) L e g a l C h a r g e a s above. Documentation: */ b) L e g a l o p i n i o n t h a t s u c h C h a r g e represents a v a l i d First Charge on the properties in question, that there are n o o t h e r e n c u m b r a n c e s o n the p r o p e r t i e s a n d th at in th e e v e n t o f d e f a u l t w e as foreign lenders In the U n i t e d States a n d t he S t a t e o f C a l i f o r n i a w i l l h a v e n o d i f f i c u l t y i n f o r e c l o s i n g o n the properties and realising our security w i t h o u t n e c e s s a r i l y the a g r e e m e n t o f Girard Investments and its partners. • c) V a l u a t i o n o f p r o p e r t i e s b y i n d e p e n d e n t qualified Appraiser giving a total value o f at least U.S. $3 m i l l i o n . d) C o p i e s o f L e a s e s o f p r o p e r t i e s s h o w i n g annual rents o f at least U . S . $200,000. We u n d e r s t a n d t h e s e a r e l a r g e l y s u b j e c t to annual r e v i e w w i t h i n creases on Cost of Living r ises or 10% wh i c h e v e r is greater. 11. I t is u n d e r s t o o d t h a t s h o u l d c i r c u m s t a n c e s a r i s e w h e r e b y i n t e r e s t o n the l o a n is s u b j e c t to U n i t e d S t a t e s ta xe s, w i t h h o l d i n g or otherwise, or c h a n g e s in Ce nt r a l B a n k o f Ireland requirements or regulations affe ct i n g in any w a y Guinness + M ahon * L i m i t e d ' s p r o f i t a b i l i t y o n t h i s loan, t h e n on t h r e e m o n ths ' n o t i c e t h e b o r r o w e r s h a l l h a v e t h e r i g h t to r e p a y t h e loa n w i t h o u t p e na l t y and all i n t e r e s t outstanding, or w i l l p a y an i n c r e a s e d r a t e o f i n t e r e s t to c o m p e n s a t e for a n y s u c h t a x l i a b i l i t i e s o r loss of profitability. Other terms and conditions: . Please s i gn i f y your acceptance o f this loan and all t e r m s and conditions by s i g n i n g and returning the enc losed copy of this letter where indicated. Y o u r s fa it h f u l l y , •. GUINNESS + M AH O N LIMITED. P e r& ty L . P.O'Dwyer, B a n k i n g Manager. . 1 C f , * n G U IN N E S S . MAHON CAYMAN TRUST LIMITED Ufcftani Banking Grouo A Uao'Bmt zi t # jun n«3s Ma/ion T u o r w N o 3-tijSJ 4 T«4« x a O Boa 3 8 / CP 4JC5 ■ _ o w d Cayman Cuw* Adorcu G«j.nn«aa _ Bnnsn West rcita • 24ch J u n e , 1982 i yout f t ' our rml , JA C :ee . M r. P . O’Dwyer G u in n e s s & Mahon L ed. 17 C o lle g e G reen D u b lin 2 IRELAND if0"*'’ .. ■ : . D ear PaC, ' We c o n f ir m o u r t e l e x o f 2&ch J u n e , w hich r e a d s a s f o llo w s : • "REFERENCE THE CALIFORNIA AS WHEN I WAS IN BY ME HERE ON ' LOAN FACILITY ARRANGED FOR GIRARD INVESTMENTS OF SET OUT IN LETTER DATED 9TH JUNE WHICH YOU SIGNED DUBLIN. ACCEPTANCE AND DOCUMENTATION NOW RECEIVED YOUR 3EKALF AND I- WILL FORWARD. WE ARE CREDITING TO YOUR. ACCOUNT WITH MANUFACTURERS HANOVER ON FRIDAY, 25TH JUNE THE BACKING DEPOSIT OF U .S . DLRS. 1 ,2 5 0 ,0 0 0 .0 0 .WHICH WILL BE A DEPOSIT IN OUR NAME AT TWO PERCENT OVER SIX MONTH LIBOR VALUE FRIDAY, 25TH JUNE. ' PLEASE GIVE INSTRUCTIONS TO TRANSFER THE LOAN PROCEEDS OF DLRS 1 ,2 5 0 ,0 0 0 ON 25TH JUNE TO: . . - BANK OF AMERICA • 7680 GIRARD AVENUE . LA JOLLA, CALIFORNIA 92307 ‘ 1 . FOR ACCOUNT GIRARD INVESTMENTS A/C NO. 0 L 7 0 1 -0 6 2 4 3 . % • LOAN AT TWO AND "ONE-HALF PERCENT OVER SIX MONTH LIBOR. LETTER FOCLOWS." As p r o m is e d - I e n c lo s e : 1. • ' Copy o f y o u r O f f e r o f F in a n c e d a c ed 9ch J u n e 1932, d u ly a c c e p c e d . 2. A p p r a is a l o f p r o p e r t y by Crubb & E l l i s . 3. L e g a l o p i n io n ^ 'r e l a c i n g :o Deed o f T r u s c . / c o n c 1d T n ' C o n tin u a tio n Pnye N o I The c o p i e s jof l e a s e s 'h a v e been fo rw a rd e d co u s and we a r e h o ld in g th e s e buc w i l l p a s s them on co you ac any cim e you so r e q u e s c . I n s t e a d o f a M ortgage i t h a s b e e n a g r e e d co c a k e a c h a rg e by way o f Deed of T ru s t. A copy o f t h i s w i l l be fo rw a rd e d co you i n due c o u r s e , che O r ig in a ! i s h e ld by Che T i d e Company. , O ur d e p o s i t w ith you w i l l be a c 2% o v e r 6 monch LIBOR w ich i n c e r e s c p a y a b le 6 m o n th ly on r e c e i p t by you o f che ir ic e r e s c o n - t h e lo a n co G ir a r d I n v e s t m e n t s . K in d ly n o t e Co s e n d an i n c e r e s c demand ouc Co G i r a r d In v escm en cs a c che a p p r o p r i a c e c im e . T h e i r new a d d r e s s i s s . . 7851 R e v i l l e D riv e La J o L la C a l i f o r n i a 92037 U. S . A. * T e lep h o n e N o .: (7 1 4 ) 4 50-0851 T h is i s c h e a d d r e s s a n 4 te l e p h o n e num ber o f S te p h e n " finocliT che M anaging P arC ne....... ............... — — ._______________________ ___ o f G i r a r d I n v e s c m e n c s .^ v.„ I w ould a p p r e c i a t e i t i f you c o u ld w r ic e co him now c o n fir m in g d is b u rs e m e n t: o f ch e lo a n and a d v i s i n g che 'r a t e o f i n c e r e s c a n d che am ount c h a c w i l l be d u e . I s u g g e s t we make ch e f i r s t s i x monch p e r i o d r u n from 2 5 th J u n e t o 3 l s c D ecem ber w ich an a p p r o p r i a c e i n c r e a s e i n ch e % y e a r ly 'a m o u n t co alL ow f o r ch e e x t r a d a y s , and t h e r e a f t e r on 3 0 th J u n e an d 3 l s t D ecem ber. You m ig h t a l s o a s k them to w ir e i n c e r e s c pay m en ts d i r e c t Co y o u r a c c o u n t i n New Y ork to a r r i v e c h e r e by che d u e - d a c e s . . K ind r e g a r d s , e n c ls Appendix X V 1. (36) M r V i c t o r E n o c h Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Victor Enoch a) Letter of 12 December 1996 - Ansbacher Cayman Limited to IIB. b) Facsimile of 19 December 1996 - IIB to M r Mark Richford. c) Guinness and M ahon credit committee application of 15 October 1993. d) Letter of 11 July 1991 - Ansbacher Limited to JD Traynor. e) Letter of 16 June 1983 - G M C T to bank of Ireland. f) Transcript of evidence of M r Stephen Enoch to the Inspectors on 17 January 2001 and documents produced at that examination: Letter of 6 December 1989 and schedule - Guinness and Mah o n to Ansbacher Limited. Letter of 22 November 1991 - IIB to JD Traynor. Guinness and Mahon internal m e m o of 8 October 1993. Letter of 24 January 1991 - M r Chris Waite to M r Stephen Enoch. Guinness and M ahon internal m e m o of 9 March 1992. g) Transcript of evidence of M r Michael Enoch to the Inspectors on 5 April 2001 and documents produced at that examination: Letter of 27 January 1997 - Martina Investments Limited to Irish Intercontinental Bank Limited. Credit application to IIB of 2 August 1994 re Martina Investments. Letter of 26 M a y 1993 Guinness and Mahon to Martina Investments. Letter of 31 M a y 1993 - Cayman International Bank and Trust Company Limited to Guinness and Mahon. IIB credit application of 26 August 1996 re Martina Investments. IIB credit application of 2 August 1994 re Martina Investments. Letter of 6 March 1995 - Guinness and Mahon to IIB. Letter of guarantee of 24 October 1994. Extract from financial accounts of Martina Investments Limited of 5 April 1993. Telefax of 27 M a y 1994 - Cayman International Bank and Trust Company Limited to Guinness and Mahon. Letter of 27 January 1997 - Martina Investments to IIB. Letter of 20 M a y 1993 - JA Collins to JD Traynor. AssnrnD {Ca?m*nj H e n r y A n s b a c h e r ------------------------- r t‘u mix »\r UIU.M) caymas CAVMAN .\ A.SOt HKITl.'ll W JjT ISIHl'S T*!fphuiir +: io * H i tb it hM-timiic -t 409 9*1 79** FACSIMILE T. Ux CT «10? ANSBAC i‘ TO Gervaise McAteer Irish Intercontinental Bank Fax 011-353-678-5034 FROM J.Maxine Everson Fax 1345 949 7946 Tel 1345949 8655 DATE 12 December, 1996 PAGES . 2 (tnd this page) • Ifpagesartnutreceived,phasecai/13459498653.ThisJotItconfidentialandmayalsobeprivileged.Ifyouare nottheIntendedrecipient,pleasenotifyusimmediately;youshouldRotcopyItoruseitJotanypurpose,nor discloseitscontentstoanyotherperson. . ' - -’i . ■ . Ref Martina InvestmentsLimited • • Re£ e'dtentj2\<4SJ'i»mJlfiO ' ' ‘ 2 refer to our telephone conversation oftoday. . The notice for the loan interest should be sent to die following:-. Martina Investments Limited, Arden House, 26 Woodside Drive, Castlepart, Dublin 14, Ireland. The deposit could be rolled to mature on January 13,1-997 after which itcould be combined ' with the other deposits 1EP310,000 and IEP645.000 and placed for one year. However . although the three loans should mature on the same date, please do not combine them.. The interestfor the deposit of 1EP333,050.00 could be credited to the following account NAME: Allied Irish Bank Ltd. - Dublin A C C O U N T NO: 0804- ’9056 N/O Henry Ansbacher & Co. Ltd. For further credit to Account No: 190017-216 ’N/O Ansbacher (Cayman) Limited REF: 6465 ' A olthe/•**»No’ureitank of $OV*wi 5>cvp Kindly advise Aidan Storey of the terms ofthe Joan. In future, please note any further correspondence be directed to Marie Richford. Yoyw-sincercly, J.^Cfidrie Assistant Manager Corporate /cam Facsimile M essage "DearMark . As requestcdthe followingisconfirmation ofdetailsoa Martina Investments Ltd. Loans; Name ‘ Pcripd Martina Investments Ltd 12/07/96-13/01/97 MartinaInvestments Ltd 12/07/96 -13701/97 MartinaInvestmentsLtd 13/12/96-13/01/97 Principal InterestRate EEP645,550 IEP310,000 JEP332,500 6.75% 6.75% / . 6.875% * Principal InterestRate IEP645,550 IEP310,500 IEP332,5Q0 '5.5625% f 5.5625%" 5.75% ^ ./ . Deposits Name Period Ansbacher (Cayman) Ltd 12/07/96 13/01/97 Ansbacher (Cayman) Ltd 12/07/96 13/01/97 Ansbacher (Cayman )Ltd 13/12/96 13/01/97 Kind Regards \J.r ervaise Me Ateer q: : CSEDtT C O M M I T T E E APPLICATION Unit: G . & M. D u b l i n ' M i n u t e No: D a t e : ^ ’10 l^/RENEWAL/XMElteltJ^/WTIFI^TZfllJ/tfeJTlJte: C r e d i t C l a s s : S a t i s f a c t o r y _________ ________________________________________ N e x t R e v i e w D a t e : 3 l / l Q / i q q 4 BORROWER/OBLIGOR: A MOUN T: T AB MOUNT CORPORATION USD 1,550/000 (USD 1 , 5 3 4 , 5 0 0 S U B - P A R T I C I P A T E D T O C A I M A N I N T E R N A T I O N A L B A N K M T R U S T C O M P A N Y L I M I T E D [CIBTC LTD]) • USD 15,500 N E T EXPOSURE P R O P O S A L & P U R P O S E O F FACILI T T ( S ) : . • • • * * F a c i l i t y w a s o r i g i n a l l y p r o v i d e d to. a s s i s t i n t h e p u r c h a s e o f a p r o p e r t a t La J o l l a , S a n D i e g o , Califo r n i a . T h e l o a n w a s g r a n t e d i n O c t o b e r 19 f o r a p e r i o d o f 5 y e a r s t o 1 1 t h O c t o b e r 1993 • W e a l s o h a v e a n addition, f a c i l i t y o f U S D 3 , 0 0 0 , 0 0 0 o u t s t a n d i n g to t h e s a m e c l i e n t f o r t h i s purpo: w h i c h is a l s o s u b - p a r t i c i p a t e d to t h e e x t e n t o f 99% l e a v i n g a n e t expos; o f USD 30.000. ______________;_______ !___________________ ._________ ______________ Source of Repayment, Repayment Programme & Final Maturity: S a l e of p r o p e r t y / B o r r o w e r s ' re so ur ce s. D e m a n d f a c i l i t y s u b j e c t to. annual review, qii-■?*»»■*:*» m a t u r i t y 3 1/ 10 /9 8____________________________ _________ B a n k 's I n c o m e ( i n c l u d i n g R e t u r n o n C a p i t a l ) : M a n a g e m e n t F e e 0 . 5 % p.a. o n USD 1,550,000 R O C £00% _____ ]__________ \ Security and S e c u r i t y Margin: N e t e x p o s u r e o n b o t h f a c i l i t i e s o f $45, 50 0 is s e c u r e d a s f o l l o w s : (i) (ii) F i r s t C h a r g e o v e r p r o p e r t y i n L a J olla, C a l i f o r n i a , v a l u e d a t U S D 6,000,000. G u a r a n t e e o f C I B T C L t d f o r U S D 4 5,000 (net e x p o s u r e o n F a c i l i t y 1. U S D 3 0 . 0 0 0 a n d F a c i l i t y 2 U S D 1 5 . 5 0 0 ) ___________ B A N K ' S R I S K E X P O S U R E - A g g r e g a t e (i ncl us iv e o f t h i s p r o p o s a l ) to: • Customer Committed/Limit: U S D 45,500 . Ba la nc e: U S D 45,500 Related C u s t o m e r * U S D 12 ,5 00 * USD 9,000 * USD 4.000 USD 25 ,5 00 . IRP 3 1 0 . 0 0 0 * U SD 1 2, 5 0 0 * USD 9 , 0 0 0 * USD 4,000 US D 25,500 IRP 3 1 0, 00 0 Girard S & L Enoch S Enoch Total IR P358,3' . Martina Investments Girard S & L Enoch S Enoch IRP 358,34 Martina Investments * E x p o s u r e s r e p r e s e n t 1% o f o v e r a l l l oa n ba la n c e , w h i c h is 99% s y n d i c a t e d t o C I B T C Ltd. /... BORROWER/OBLIGOR: T A B MOUNT CORPORATION .../ C o n t d O T H E R C R E D I T B A L A N C E S , TWO'ES'TMEIJT P O R T F O L I O S ETC: Country Risk: Primary Risks Limit: Exposure: Drawn: , •’ C ountry o f P ri m a r y Risk: US S e c o n d a r y R i s k : Cayman I s l a n d Domicile: US • J C o u n t r y / B u s i n e s s S e c t o r Exp: . Sector Risk: G M B u s i n e s s S e c t o r : 710 Limit: C B o f I B u s i n e s s S e c t o r : 9.2 Exposure: R i s k A s s e t Weiarhtincr: 1.0 • Drawn: R e c o m m e n d e d byj. D u b l i n .C r e d i t Introduced by: Existing Client Committee Sector: De c i s i o n : A u t h o r i s e d U n d e r C r e d i t Dept. D i s c r e t i o n ox . o f B a n k E x e c . Comm, .or Credit. GcZS&Co. Date: Credit Committee . 5.x ?5 I . .. ?ob-v . (?ak cu.? 809 943 79-4G St 01 049 7948 J ANSBACHER CAYMAN •**•» J D TRAYSQR !. Anf^tcher l i m t U d P.O. Box 837, Grand Caynvm, Ciyatt I*l*n$a,Bdtlih W « t Indlai Tilepion*; <*») 949&S5 Tttac C*4S03 Ftctimila (809) 94M94* (80$) 94*42*7 I I U t h July, 1991 I I Mr.- J. D. T r a y n o r 19 Lower P embroke Street . Dublin' 2 IRELAND ’ ‘ . ’' I p ear Des, ■■-.T-' I • Spoke w i t h V i c t o r Enoch y e s te rd ay afte r w e h a d t o l d h i m t e chase u p payments. ' He has a s c e r t a i n e d that b o t h cheques we re s i tt in g w i t h Manufacturers H a n o v e r in N e w York, one had b e e n !there tw o months r T h e y w e r e cashier cheques from the C al if b r n i a B a n k made out to G ui nness ft M ah o n w i t h the ir a c c o u n t ; n umber a t M a n u f a c t u r e r s . T h e y should now have been credited. ' ' .. j l , T h e c h a ra ct er d e a l i n g w it h it a t Manu fa ct ur ers ;ia a o r e g ■ ’. Pavick (Tel. # 212-270-8149)) w h o s e e x c u s e .for not crediting-, " i u them w as d e c i d e d l y lame. Mr. Enoch 'would like: Q ft M t o ■ : : complain., . . ; ; GUINNESS M A H O N CAYMAN TRUST UMTTED r ' AJI«mhtreftlM Guinn*** Mahon Merchant Banking Gmup T«[*phl j No (8ft9'94) 9-4653/4 T«l*i (0293) CP4305 Cabl* Addr*MM StiliuwM jrour raf our rarf . ' PO Box >87 Grand Cayman British W nt Sndlaa June 16, 1983 JKE:cm Ms. M airead 0 ’Hanlon Bank o f Ire la n d Securities Department 2 College Green Dublin . . IRELAND D ear Madam, ' He: 1,000 shares Alliance E Dublin Consumers Gas. Co* Kindly advise Whether you still hold the above shares in safe keeping for -the account of Mr. Victor Enoch as early last yea2*t Mr. Enoch was to have given you instructions to deliver these shares to our Dublin Office. He would appreciate an early reply as to the whereabouts of these shares. ' Yours ^faithfully, J. M. EVERSON (HRS.) c.c. Securities Department Guinness Mahon, Dublin UNDER OATH ON WEDNESDAY, 17TH JANUARY 2 0 0 1 I hereby c e r t if y th e f o l l o w i n g t o b e a t r u e and a c c u r a t e t r a n s c r i p t o f my sh orth an d n o te s in th e a b o v e named i n t e r v i e w . S tenographer The I n s p e c t o r s : JUDGE O'LEARY MS. MACKEY BL S o lic ito r to th e In sp ectors MS. M. CUMMINS In te r v ie w e e : MR. STEPHEN ENOCH I n s tr u c te d by: L .K . SHIELDS & CO. 1 2 3 4 JUDGE 0 ' LEARY: Good m o r n i n g . As y o u know t h i s 5 is an 6 i n t e r v i e w p u r s u a n t t o t h e pow ers c o n f e r r e d on t h e 7 In sp ecto rs to 8 w h a t we a r e d o i n g , 9 a r e n o t e n q u ir in g i n t o any i n d iv id u a l, e n q u i r e i n t o t h e com pany. That i s e n q u ir in g i n t o t h e com pany. we a r e 10 en q u ir in g in t o t h e com pany. 11 a r e tw o o f t h e fou r I n s p e c t o r s . 12 who w i l l b e d e a l i n g w i t h a n y m a t t e r a r i s i n g 13 respect of th is 14 w ith o th e r a s p e c ts 15 you have l e g a l r e p r e s e n t a t i v e s . 16 w elco m e . 17 at a l l . in te r v ie w . There i s of it . We Ms. M ackey a n d m y s e l f We a r e t h e p e o p l e in O th ers w i l l be d e a l i n g I am p l e a s e d t o n o t e t h a t They a r e v e r y v e r y no d i f f i c u l t y w i t h r e g a r d t o t h a t 18 19 It 20 in te r v ie w , 21 sto p us. 22 a d v ic e 23 hand you r l e g a l a d v i s e r s 24 it 25 c o n sid e r in a p p r o p r ia te , 26 to ask us to 27 you can d i s c u s s 28 resum e a c c o r d i n g l y . 29 an i n t e r v i e w . is an i n t e r v i e w . if But a t an y tim e d u r in g th e you f e e l t h a t you n eed l e g a l a d v i c e , We w i l l w i t h d r a w a n d y o u c a n t a k e l e g a l fr o m y o u r l e g a l a d v i s e r . If on t h e o t h e r f e e l t h a t a t a n y tim e d u r in g we a r e s a y i n g o r d o i n g a n y t h i n g w h i c h t h e y th e b e st th in g f o r them i s a d j o u r n an d we w i l l a d j o u r n a n d t h e n t h e m a t t e r w i t h th e m a n d we c a n It is not a t r i a l , it is p u r e ly I f a t a n y t i m e we a r e g o i n g t o d ra w 1 i n f e r e n c e s w h ich a r e a d v e r s e t o an ybody i n c l u d i n g 2 y o u r se lf, 3 a s s e s s i n g and q u e s t i o n i n g t h e f o u n d a t i o n s o f t h a t . 4 Do y o u u n d e r s t a n d t h a t ? 5 A. 6 IQ . 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 MR. ENOCH: T h is i s t h a t p e r s o n w i l l have an o p p o r t u n it y o f Y es. a sw orn i n t e r v i e w s o I w ou ld a s k you t o th e oath . tak e 1 2 3 4 2 Q. MR. Mr. E n o c h w o u ld l i k e SHIELDS: make a f e w o p e n i n g 5 6 c o m m e n ts i f 7 JUDGE O'LEARY: he c o u ld ? I have no d i f f i c u l t y th a t. 8 9 to an o p e n in g s p e e c h , 10 a ll. 11 MR. ENOCH: w ith I f h e w a n t s t o make I h a v e no d i f f i c u l t y w it h t h a t a t "I, S te p h e n Enoch, t o your l e t t e r 12 refer of 13 1 7 t h May 2 0 0 0 a n d t o y o u r s u b s e q u e n t c o r r e s p o n d e n c e 14 w i t h my S p a n i s h a t t o r n e y , 15 M essrs. 16 h a v e b e e n a d v i s e d t h a t t h e H ig h C o u r t o r d e r o f 17 2 2 n d S e p t e m b e r 1 9 9 9 d o e s n o t a p p l y t o me a n d t h a t 18 y o u a s I n s p e c t o r s h a v e no j u r i s d i c t i o n 19 I am a c c o r d i n g l y a t t e n d i n g t h i s m e e t i n g w i t h o u t 20 p r e ju d ic e to th a t p o s itio n 21 c la r ify 22 to 23 but p a r tic u la r ly in 24 a r tic le 25 v ery a g g r ie v e d . S i g n o r R i p l l an d LK S h i e l d s S o l i c i t o r s . As y o u a r e a w a r e , o v e r m e. and p r i m a r i l y i n c e r ta in m atters out o f c o u r te sy to c l e a r my g o o d name i n t h e l i g h t I order to you and o f P r e s s c o m m e n ts l i g h t o f t h e S u n d a y T im e s o f 2 6 t h S ep tem b er 1999 a b o u t w h ich I f e e l 26 27 I 28 n o n - r e s i d e n t on t h a t d a t e a n d h a v e n o t b e e n r e s i d e n t 29 in le ft I r e l a n d on 1 s t A p r i l 197 9 and becam e a Ire la n d s in c e th at d ate. I b e lie v e it is 1 a p p r o p r ia te to r e f e r to a l e t t e r 2 C e n t r a l B a n k o f I r e l a n d d a t e d 3 1 s t May 1 9 7 9 w h i c h 3 was i s s u e d sh o r tly a fte r fr o m t h e I becam e a n o n - r e s i d e n t . 4 5 In your l e t t e r o f 2 7 th J u ly 2000 you r e f e r t o 6 am o u n tin g t o 7 I r e l a n d L t d r e c e i v e d b y m e. 8 d o c u m e n ta tio n in r e l a t i o n t o t h e s e 9 lik e £ 1 ,3 0 0 ,0 0 0 to c l a r i f y c e r ta in lo a n s fr o m G u i n n e s s & Mahon I cannot lo c a te issu e s in lo a n s. I w ou ld r e la tio n fo r th e a v o id a n ce o f d ou b t. any to th ese 10 lo a n s At t h e tim e t h a t 11 t h e l o a n s w e r e g r a n t e d t o me I w as n o t a r e s i d e n t 12 f o r t a x p u r p o s e s i n t h e US. 13 th ese 14 and d e p o s i t s . 15 2 7 th J u ly 2000 t h a t i t 16 h y p o t h e c a t i o n w o u l d b e s i g n e d b y Mr. 17 and th a t th e 18 Mahon I r e l a n d L t d w o u ld n o t m e n t i o n t h e 19 h y p o th e c a tio n o f th e d e p o s it. I n e v e r m et 20 Mr. t o u n d e r s t a n d why 21 su ch m a t t e r s w ere r e f e r r e d t o a s a s u i t a b l y 22 lo a n tr a n s a c tio n . 23 referred to 24 t h i s may h a v e b e e n i n c l u d e d a s a r e s u l t o f b e i n g a 25 stan d ard o p e r a tin g p r a c t ic e My r e c o l l e c t i o n is th at lo a n s w ere r e q u ir e d t o be s e c u r e d b y p r o p e r t y I u n d e r s t a n d fr o m y o u r l e t t e r fa c ility was a r r a n g e d t h a t le tte r of le tte r s Desmond T r a y n o r g iv e n by G u in n ess Desm ond T r a y n o r an d I f a i l of & secured Such m a t t e r s w ere c e r t a i n l y n o t a t my r e q u e s t . I can o n l y assum e t h a t o f t h e bank. 26 27 I t w ou ld a p p e a r t h a t i t 28 lo a n s 29 t h a t t h e d e p o s i t s h e l d b y me i n A n s b a c h e r Cayman L t d has been im p lie d th a t th e o b t a i n e d b y me w e r e s e t up i n s u c h a m anner s o 1 w o u l d n o t com e t o t h e a t t e n t i o n o f U n i t e d S t a t e s 2 I n t e r n a l R evenue S e r v i c e . 3 in te n d e d to d e fr a u d th e U n ite d S t a t e s 4 Revenue S e r v i c e . 5 se r io u s, 6 not r e sid e n t 7 fo r th e d u r a tio n o f t h i s 8 d e p o sits 9 u n d e r s t a n d why a n y p a r t y s h o u l d s u g g e s t o t h e r w i s e fa lse T h i s may h a v e b e e n I regard th is In tern a l to be a very and m i s l e a d i n g i n s i n u a t i o n . in e i t h e r th e U n ite d S t a t e s lo a n , A s I w as or I r e la n d s u c h l o a n s an d w ere r e g u la r and l e g a l . I am a t a l o s s 10 an d am I a n n o y e d t h a t my r e p u t a t i o n h a s b e e n 11 ta r n ish e d . 12 1994. to T h ese lo a n s were u l t i m a t e l y r e p a i d i n 13 14 ' You h a v e r e f e r r e d i n y o u r l e t t e r o f 2 7 th J u ly 2000 15 t o t r u s t s m a n a g e d b y A n s b a c h e r Cayman L t d . 16 to s t a t e 17 e sta b lish e d , 18 after 19 3 Q. for th e th at record th a t i f any su ch t r u s t s I c e a se d to be r e s id e n t in JUDGE O'LEARY: w ere e s t a b l i s h e d I r e la n d ." Mr. E n o c h , 21 it 22 th e p a s t, 23 A. 24 4 Q. 25 A. 26 5 Q. 27 A. 28 6 Q. y o u r f a m i l y had b u s i n e s s i n t e r e s t s is th at w ere Thank y o u . 20 29 any t r u s t s I w ish as I u n d erstan d in I r e la n d in correct? Y es. Were t h e y i n t h e t e l e v i s i o n r e n ta l area? Y es. T h ey w e r e s o l d a t o n e s t a g e , w ere th e y ? Y es. Whose b u s i n e s s w as i t , p r e c ise ly ? if y o u d o n ’ t m i n d me a s k i n g A. 7 Q. A. 4 8 Q. 5 A. 6 9 Q. 7 A. 8 10 Q. Was i t w as my f a t h e r , a lim ite d lia b ility 10 A. 11 11 Q. 12 A. my b r o t h e r a n d m y s e l f . co m p a n y , d o y o u know? Y es. What w as t h e name o f t h a t com pany? T e l e r e n t s L td . Each o f t h e t h r e e o f you had s h a r e h o l d i n g s in it? Y es. Do y o u rem em b er i n r e s p e c t o f y o u r s e l f w h a t y o u r s h a r e h o ld in g w as. 9 Was i t Not e x a c t l y a p e r c e n ta g e , Was i t in a p a r tic u la r p ercen tage? no. th e order o f a th ir d ? I t w o u ld h a v e b e e n p r o b a b ly b e tw e e n a q u a r t e r and a th ir d . 13 14 P r e c ise ly i t 12 Q. I am r e a l l y such. 15 in te r e ste d What i s in your b r o t h e r 's a ffa ir s as y o u r b r o t h e r ' s name? 16 A. M ic h a e l. 17 13 Q. 18 A. 19 14 Q. 20 A. 21 15 Q. 22 A. He i s sic k , 23 16 Q. He i s an e l d e r l y man a t t h i s 24 A. He i s in d eed . 25 17 Q. 26 A. 27 18 Q. 28 A. 29 19 Q. He i s Y es, still r e sid e n t? he i s . U n fo r tu n a te ly your fa th e r i s dead, is th at correct? N o. Or s i c k ? W here i s yes. stage? he liv in g ? S p a in . The sam e a s y o u r s e l f ? Y es. When was t h a t b u s i n e s s s o ld a p p r o x im a te ly ? 2 0 Q. From a t a x p o i n t o f v i e w , you b e l i e v e t h a t you l e f t I r e l a n d so m etim e s h o r t l y a f t e r 4 th a t, is th at correct? 5 A. 6 2 1 Q. 7 A. 8 22 Q. I d o n 't b e lie v e it, I know i t . When w a s t h a t ? T h a t w a s o n 1 s t A p r i l 197 9 . Was a t r u s t e s t a b lis h e d b e fo r e or a f t e r th e s a le of th e b u sin e ss? 9 10 A. 11 2 3 Q. 12 A. What t r u s t a re you t a l k i n g ab ou t? You s a i d a t r u s t w as f o u n d e d a f t e r y o u l e f t ? Any t r u s t t h a t may h a v e b e e n f o u n d e d w o u l d h a v e b e e n done a f t e r 13 14 24 Q. 15 A. I le ft. Was s u c h a t r u s t P ro b a b ly , yes, fo r m e d ? I t h i n k s o a t som e s t a g e a f t e r I le ft. 16 17 2 5 Q. 18 A. 19 2 6 Q. I n t h e Cayman I s l a n d s ? Y es. T y p ic a lly th e se t r u s ts i n t h e Cayman I s l a n d s 20 o p e r a te d th rough lim it e d l i a b i l i t y 21 Are you aware o f t h a t . 22 t h e y o p e r a te d th ro u g h l i m i t e d l i a b i l i t y co m p a n ies? Y es, very 23 A. c o m p a n ies. T r u s ts w ere e s t a b l i s h e d I am v a g u e l y a w a r e o f t h i s . It is and 24 c o m p l i c a t e d and I n e v e r r e a l l y u n d e r s t a n d m o st o f 25 th ese th in g s. 26 27 Q. 27 A. 28 2 8 Q. 29 Do y o u know who t h e b e n e f i c i a r i e s o f t h e t r u s t w ere? What t r u s t ? The t r u s t t h a t y o u s a i d was f o u n d e d i n t h e 2 2 9 Q. w h i c h w e r e u s i n g t h e t r u s t m oney? 3 4 Do y o u know t h e name o f t h e o p e r a t i n g c o m p a n i e s A. 5 N o. MR. SHIELDS: C o u ld we c l a r i f y w h a t t r u s t we a r e t a l k i n g a b o u t 6 7 s o t h a t we a r e a l i t t l e 8 JUDGE O'LEARY: b it Any t r u s t h e w a n t s t o me a b o u t . 9 10 d id you e s t a b l i s h 11 MR. SHIELDS: JUDGE O'LEARY: A. 16 31 Q. C e r t a i n l y a t r u s t w as f o r m e d a f t e r I l e f t Mr. Enoch, tru st; 17 A. th ere is When y o u t a l k n o t h i n g wrong w i t h h a v in g a about t r u s t s th ey are a l l 20 u n d erstan d a l l 32 Q. is Ir e la n d . anybody can have a t r u s t . 19 a b it and a l l th e se th in g s, c o m p l i c a t e d and I n e v e r r e a l l y th ese th in g s. What I am i n t e r e s t e d in w ith regard t o 22 t h a t you have i s 23 th at te r r ib ly 24 I w o u ld l i k e 25 c o m p a n i e s who u t i l i s e d 26 That i s 27 a c om p an y i n v e s t i g a t i o n . 28 moment o n c o m p a n i e s ? 29 it n o t h i n g t o do w i t h i t . 15 21 Irela n d . I u n d erstan d t h a t , 14 18 I a s k e d h im , I t was o n l y a f t e r h e le ft 30 Q. te ll a tru st. 12 13 cle a r e r? — t o b e h o n e s t w i t h y o u I am n o t co n cern ed w heth er i t to any t r u s t w as o n e o r t w o — know t h e name o f t h e o p e r a t i n g t h e fu n d s o f t h a t t r u s t . w hat I w ou ld l i k e t o know. Remember t h i s I am h o n i n g i n fo r th e is 33 Q. Was t h e r e a n y m on ey t r a n s f e r r e d b y y o u w h i l e y o u w ere s t i l l 4 5 Cayman I s l a n d s ? A. 6 7 No. A t t h a t t i m e t h e r e w as e x c h a n g e c o n t r o l f o r f o u r y e a r s and a s s e t s w ere b e in g f r o z e n . 34 Q. A re you f a m i l i a r w it h an o p e r a t in g e n t i t y A. P e r so n a lly , no, I h a v e no i n v o l v e m e n t w i t h i t . 10 I h a v e o b v i o u s l y h e a r d t h e nam e. 11 c o n n e c tio n w h a tso ev er w ith i t . 12 35 Q. But I h a v e no Who a r e t h e b e n e f i c i a l o w n e r s o f t h a t com pany, 14 A. 15 3 6 Q. No. The d i r e c t o r s o f t h e com pany a r e J o h n C o l l i n s , 16 J o h n F u r z e a n d M. W i n t e r . 17 u n fo r tu n a te ly d eceased . 18 d i r e c t o r o f A n s b a c h e r Bank an d Mr. W i n t e r , 19 know who h e i s . 20 J e r s e y I am t o l d . 21 b e h a l f o f som ebody. 22 w e r e a c t i n g o n . b e h a l f o f yo u ? A. No, d e fin ite ly He i s 25 m et. 26 have never heard o f . 28 29 is a fo rm er we d o n ' t in a sim ila r p o s it io n in be p o s s ib le th a t th e y I h a v e no c o n n e c t i o n w h a t s o e v e r t o M a rtin a I n v e s t m e n t s . 37 Q. Mr. C o l l i n s Would i t n ot. John C o l l i n s Mr. F u r z e i s O b v i o u s l y t h e y a r e a c t i n g on 24 27 do y o u know? 13 23 c a lle d M a rtin a I n v e s tm e n ts ? 8 9 a ta x r e s id e n t in Ir e la n d to th e John F u rze I h ave n e v e r I have m et. The o t h e r c h a p I Do y o u know t h a t M a r t i n a I n v e s t m e n t s ow ns o r d i d own 1 38 Q. 2 A. 3 3 9 Q. Do y o u know w h a t t h o s e p r o p e r t i e s w e r e ? N o, not o ffh an d . We h a v e r e a s o n t o b e l i e v e t h a t M a r t i n a I n v e s t m e n t s 4 L td i s 5 Bank & T r u s t Company L t d f o r t h e u l t i m a t e b e n e f i t 6 t h e m em bers o f y o u r f a m i l y ? 7 A. a c o m p a n y c o n t r o l l e d b y Cayman I n t e r n a t i o n a l That i s i n c o r r e c t b e c a u s e I have a b s o l u t e l y no 8 c o n n e c t io n w h a tso e v e r nor have I e v e r had any 9 c o n n e c t i o n w h a t s o e v e r w it h M a rtin a I n v e s t m e n t s . MR. SHIELDS: 10 Have y o u a d o c u m e n t o r so m eth in g or in f o r m a t io n 11 12 to th at e ffe c t? 13 14 40 Q. That i s a m atter fo r o u r se lv e s, Mr. S h i e l d s . I s M i c h a e l B. E n o c h y o u r b r o t h e r ? 16 A. 17 41 Q. 18 Y es. W ould y o u b e s u r p r i s e d i f I t o l d you t h a t he had a p o w e r o f a t t o r n e y f o r t h a t com pany? 19 A. 20 42 Q. N o. I t h o u g h t y o u s a i d t h a t t h e r e w as no c o n n e c t i o n t h a t y o u knew b e t w e e n . . . (INTERJECTION)? 21 A. 23 24 JUDGE O'LEARY: ' 15 22 of I have no c o n n e c t io n w h a tso ev er; y o u a r e a s k i n g me a b o u t m e. I am a s k i n g y o u a b o u t i n f o r m a t i o n . I u n d e r s to o d you 25 to you r k n o w led g e a 26 co m p an y c o n t r o l l e d 27 Enoch f a m i l y ? 43 Q. 28 A. 29 44 Q. say th a t t h is com pany was n o t t o fo r th e u ltim a te b e n e f it o f th e C orrect. Do y o u know w h o s e u l t i m a t e b e n e f i t it is fo r? 1 A. 2 45 Q. No, 1 d o n 't know b u t c e r t a i n l y n o t f o r me. Do y o u know who t h e b e n e f i c i a l o w n e r s o f t h e c o m p an y are? 3 4 A. 5 46 Q. No. Mr. E n o c h , 1 st A p r il 6 7 A. 8 47 Q. 1979 no lo n g e r t o be r e s i d e n t in Ir e la n d ? C orrect. You a r e f a m ilia r w ith th e d if f e r e n c e b etw een b e in g r e sid e n t 9 y o u c o n s i d e r e d y o u r s e l f fr o m an d b e i n g t a x r e s i d e n t . They a r e n o t 10 n e c e s s a r i l y d e e m e d t o b e t h e sam e t h i n g . 11 r e f e r r in g to b e in g r e s id e n t or to b e in g ta x 12 re sid e n t? 13 14 A. ' 48 Q. B oth . Where d i d y o u b e c o m e t a x r e s i d e n t a t t h a t s t a g e ? In th e U n ite d S t a t e s . 15 A. 16 49 Q. 17 A. C orrect. 18 50 Q. You l e f t 20 A. 21 51 Q. th e U n ited S t a t e s so m etim e l a t e r and went S p a in ? Y es. What w a s t h e d a t e o f t h a t o p e r a t i o n do y o u t h i n k , of th at tra n sfer? 22 23 A. 24 52 Q. I t w as i n e a r l y J u n e 1 9 9 0 . A r e y o u f a m i l i a r w i t h a s t r u c t u r e named t h e Tabm ount C o r p o r a t i o n ? 25 26 As a n d f r o m 197 9? to 19 A re you A. 27 I h a v e h e a r d t h e name b u t I am n o t f a m i l i a r w i t h i t s o p er a tio n , 28 53 Q. 29 A. no. Are you one o f t h e b e n e f i c i a l ow ners o f t h a t ? No. As I m en tio n e d b e f o r e , a l m o s t e v e r y t h i n g I own 1 2 54 Q. 3 A. 4 55 Q. N o. Do y o u know t h e p r o p e r t y t h a t i s ow ned b y t h e T abm ount C o r p o r a t i o n ? 5 6 A. 7 5 6 Q. 8 A. Some o f t h e m , 57 Q. yes. But you h a v e no b e n e f i c i a l in v e s t m e n t ? N o. To t h e b e s t o f my k n o w l e d g e n o n e o f t h e s e p r o p e r tie s 9 10 You a r e n o t t h e b e n e f i c i a l o w n e r s o f t h a t a t a l l ? are lo c a te d in Ir e la n d . A r e y o u f a m i l i a r w i t h an i n v e s t m e n t v e h i c l e c a lle d G ira rd I n v e s tm e n ts ? 11 12 A. 13 58 Q. 14 A. 15 59 Q. Y es. Do y o u own t h a t ? I used to own p a r t o f i t . I s t h e name o f o n e o f t h e t r u s t s w h i c h w as 16 e sta b lish e d 17 Ir e la n d , 18 A. 19 60 Q. 20 A. 21 61 Q. N o, i n t h e Cayman I s l a n d s a f t e r y o u l e f t t h e Anne E n o c h T r u s t ? I am n o t a w a r e o f t h a t t r u s t . You d o n ' t know a n y t h i n g a b o u t i t ? N o. C o u ld you e x p l a i n , Mr. E n o c h , why a n e n t i t y known a s 22 t h e Anne E n o c h T r u s t w as l i s t e d 23 a s h a v in g a s s e t s w h ich c o u ld be u s e d a s s e c u r i t y 24 t h e l o a n o f £ 1 , 2 5 0 , 0 0 0 w h ich you had n e g o t i a t e d 25 G u i n n n e s s Mahon Cayman T r u s t L t d . 26 th at? 27 A. 28 62 Q. on 1 5 t h A p r i l 1988 for from Can y o u e x p l a i n C o u ld you r e p e a t t h a t q u e s t i o n ? C o u ld you e x p l a i n if y o u know n o t h i n g a b o u t t h e A nne E n o c h T r u s t , a s you s a i d , how i t is liste d in a 1 le tte r 2 Cayman T r u s t t o i t s 3 its 4 w h ich you w ere n e g o t i a t i n g on b e h a l f o f 5 G ira rd I n v e s tm e n ts i f 6 A. 7 8 a ssets D u b lin o f f i c e are s e c u r ity 63 Q. fo r a lo a n o f £ 1 ,2 5 0 ,0 0 0 y o u know n o t h i n g a b o u t i t ? B e ca u se G ira rd In v e s tm e n ts borrow ed £ 1 ,2 5 0 ,0 0 0 I u n d erstan d t h a t . o b v io u sly i t I f y o u know n o t h i n g a b o u t i t , c o u ld n 't be used as s e c u r it y A. for th a t I o n l y o w n ed a s m a l l p a r t o f G i r a r d I n v e s t m e n t s . 12 T h e r e f o r e f o r my p a r t o f i t 13 th e 64 Q. A. I w o u l d h a v e known a b o u t lo a n . B u t d i d y o u know t h a t Anne E n o c h T r u s t w as b e i n g used as s e c u r ity 15 16 fo r th is? N o, my u n d e r s t a n d i n g i s t h a t t h e p r o p e r t y w as b e i n g 17 used fo r se c u r ity . 18 f o r a p r o p e r ty l o c a t e d in th e U n ited S t a t e s , 19 Ir e la n d . 20 65 Q. The G i r a r d I n v e s t m e n t s l o a n w a s I u n d erstan d th a t p r e c i s e l y . Mr. E n o c h , not in how d i d y o u make c o n t a c t o r i g i n a l l y w i t h A n s b a c h e r ? 21 22 A. 23 66 Q. 24 A. T h r o u g h Don R e i d o f S t o k e s K e n n e d y C r o w l e y . When w a s t h a t ? I t w o u ld h a v e b e e n i n t h e e a r l y 1980's. I d o n ' t know e x a c t l y w hen. 25 26 fr o m £ 1 ,2 5 0 ,0 0 0 ? 10 14 in d ic a tin g th at A nsbacher. 9 11 d a t e d 1 5 t h A p r i l 1 9 8 8 f r o m G u i n n e s s Mahon 67 Q. Do y o u a c c e p t t h a t y o u n e g o t i a t e d t h e G ira rd In v e s tm e n ts lo a n o f $ 1 ,2 5 0 ,0 0 0 ? 27 A. 68 Q. I was i n v o l v e d w i t h i t , yes. Do y o u a c c e p t t h a t p a r t o f t h e se c u r ity for th a t 1 lo a n w ere t h e a s s e t s o f t h e Anne E n o c h T r u s t ? 2 MR. SHIELDS: You a r e r e a d i n g f r o m a 3 p i e c e o f p a p e r a n d we 4 d o n 't have it ? 5 JUDGE O'LEARY: Y e s , th at i s 6 You a r e n o t g e t t i n g 7 e ith e r u n til 8 MR. SHIELDS: I t i s I want t o g i v e i t a b it it to you. u n f a i r on th e 9 in te r v ie w e e w ith r e s p e c t . 10 JUDGE O'LEARY: T h i s i s an i n t e r v i e w , 11 is 12 MR. ENOCH: th is n o t a c o u r t o f la w . Can y o u r e p e a t t h a t 13 14 tru e. q u e stio n p le a s e 69 Q. ? JUDGE O'LEARY: I s a i d y o u n e g o t i a t e d on 15 b e h a l f o f G ira rd 16 In v estm en ts a lo a n o f $ 1 ,2 5 0 ,0 0 0 . O b v io u sly th e 17 p e r s o n who n e g o t i a t e d t h e l o a n i s t h e p e r s o n who 18 p u ts th e s e c u r it y in p la c e ? 19 A. I was i n v o l v e d w i t h t h e n e g o t i a t i o n 20 as I can r e c a l l . 21 lo a n or n o t, 22 c e r t a i n l y aw are o f t h e lo a n . 23 70 Q. 24 A. 26 71 Q. 27 A. 28 29 far W h e th e r I a c t u a l l y n e g o t i a t e d t h e I c o u ld n 't t e l l you t o d a y . I am A r e y o u a w a r e t h a t Anne E n oc h T r u s t w as b e i n g u s e d as s e c u r it y 25 I th in k as for th at lo a n ? N o. You a r e n o t ? N o. I w a s i n v o l v e d m ore w i t h t h e s e c u r i t y t h a t w as b e in g g iv e n by t h e p r o p e r ty b e c a u se a t th e tim e I was i n t h e U n i t e d S t a t e s . 1 72 Q 2 3 n e g o t i a t e t h e l o a n w i t h y o u o r do y o u rem e m b er who n e g o t i a t e d t h e l o a n ? A 4 Y es, th e o th e r p a rtn ers in v o lv e d in G ira rd I n v e s t m e n t s . 5 73 Q 6 A 7 Who w e r e t h e y ? I t w a s n ' t me, th erefo re 74 Q 9 A 10 75 Q 11 A 12 76 Q 13 A say A re y o u r e f u s i n g t o a n s w e r t h a t q u e s t i o n ? N o. Then I w i l l a sk you a g a in , who w e r e t h e y ? Who t h e y w e r e . Y es, it is a sim p le q u estio n ? There w ere o th e r p a r tn e r s in v o lv e d in t h e . . . (INTERJECTION). 14 77 Q If you r e f u s e 16 th at 17 it 18 a d u ty to 19 MR. SHIELDS: I w ill — to answ er t h e q u e s t i o n , tak e a n o te o f th a t. I w i l l make i t q u ite I u n d erstan d I d o n 't a g ree w ith c le a r — b e c a u s e you have answ er q u e s t io n s . I d o n 't t h in k he i s r e fu sin g . 20 21 I am n o t a t l i b e r t y t o who t h e y w e r e . 8 15 D id a n y b o d y e l s e JUDGE O'LEARY: I am n o t r e c e i v i n g - 22 any r e p r e se n ta tio n s a t t h is 23 stage, I am a s k i n g t h e w i t n e s s a q u e s t i o n . 24 w ants t o 25 I w i l l w i t h d r a w an d h e c a n c o n s u l t h i s 26 I h a v e n o p r o b l e m w i t h t h a t b u t I am n o t g e t t i n g 27 in to c o n su lt h is so lic ito r , he i s a d i s c u s s i o n w ith a s o l i c i t o r I f he w e ll e n t it le d . so lic ito r . on i t ? I d o n 't have p e r m issio n to g iv e th a t in fo r m a tio n ou t. I cannot g iv e it ou t. 1 78 Q 2 A That i s y o u r i n t e r p r e t a t i o n on i t . I am n o t s a y i n g 3 th a t. 4 p o s i n g t h e q u e s t i o n t o me now . 5 t h a t q u e s t i o n i n ad van ce I m ig h t h a v e b e e n a b l e t o 6 fin d out i f 7 79 Q 8 I am s a y i n g t h a t u n t i l s u c h t i m e it ...Y o u are I f y o u h a d g i v e n me w as p o s s i b l e . Do y o u t h i n k y o u m i g h t b e a b l e t o convey th e in fo r m a tio n t o us la t e r ? 9 A 10 80 Q Y es. That i s q u ite sa tisfa c to r y . W ould y o u a g r e e t h a t 11 you w ere in v o lv e d in t h r e e d i f f e r e n t 12 A nsbacher. 13 p e r s o n a l l y £ 4 0 0 , 0 0 0 an d y o u r s e l f a n d s o m e b o d y who 14 may b e y o u r w i f e — 15 £ 9 0 0 ,0 0 0 ? 16 A 17 81 Q G ira rd In v e stm e n ts lo a n s $ 1 ,2 5 0 ,0 0 0 , I d o n ' t know — L. 19 concerned about th e p rop erty, 20 t h e o p p o r t u n i t y o f t e l l i n g me a b o u t i t 21 to . B a s i c a l l y A n s b a c h e r Cayman a r r a n g e d a l l 24 s e c u r i t y o f t h e b u i l d i n g s and a l s o 25 o f d e p o sits. 27 A I am n o t r e a l l y you want th ese lo a n s. I h a v e i n my own name t h e y w a n t e d Were t h o s e d e p o s i t s i n Y es. if g i v e you How d i d t h e s y s t e m w ork? On t h e t w o t h a t 82 Q I know i t but I have to 23 26 Enoch f o r C o u ld y o u e x p l a i n t o me how t h a t w o r k e d . w as p r o p e r t y i n t h e U n i t e d S t a t e s . A y o u r se lf Y es. 18 22 fr o m s e c u r it y o f th e y o u r own name? B u t I h a v e m e n t i o n e d t i m e a n d t i m e a g a i n i n my correspondence, th is is n o t h i n g w rong w i t h i t . p e r fe c tly l e g a l and t h e r e is 1 83 Q. 2 D i d y o u p a y th e m t h e g r o s s am ount o f i n t e r e s t or th e n e t a m ount o f i n t e r e s t ? 3 A. 4 84 Q. 5 I p a i d th e m t h e i n t e r e s t on t h e l o a n . B u t d i d y o u p a y th e m g r o s s o r n e t , if you u n d e r sta n d w h a t I m ean? 6 A. 7 85 Q. 8 A. 9 86 Q. 10 A. 11 87 Q. No, I d o n ' t u n d e r s t a n d w h a t y o u m ean. You h a d m o n e y o n d e p o s i t w i t h them ? Y es. And y o u h a d m o n e y b o r r o w e d fr o m them ? Y es. T h e r e a r e t w o w a y s y o u c a n do i t . 12 th e f u l l 13 g i v i n g them a c h e q u e t o t h a t e f f e c t 14 c r e d i t your d e p o s it a ccou n t w ith th e a p p r o p r ia te 15 in te r e st 16 am o u n t? 17 A. No, in te r e st You c a n p a y th e m on t h e m on ey y o u b o r r o w e d b y or t h e y can j u s t and t h e y i n tu r n c h a rg e you w it h a n e t I a l w a y s p a i d t h e a c t u a l am ount o f i n t e r e s t 18 t h e l o a n and t h e n t h e d e p o s i t w ou ld r e c e i v e 19 in te r e st. 20 88 Q- D u r i n g t h e t i m e when y o u h a d t h i s m o n e y i n t h e Cayman I s l a n d s y o u w e r e t a x r e s i d e n t i n t h e 22 U n ite d S t a t e s ? A. 24 8 9 Q. 25 A. own . 21 23 its on N o. I th o u g h t t h a t you l e f t C orrect. I r e l a n d i n 1 9 7 9? For t h e G ir a r d I n v e s t m e n t s lo a n I was t a x 26 re sid e n t in t h e U n ite d S t a t e s . That i s 27 one. 28 o n e I was r e s i d e n t i n t h e U n i t e d S t a t e s b e c a u s e t h a t 29 w as t a k e n o u t i n t h e e a r l y 1 9 8 0 ' s . You a r e t a l k i n g a b o u t t h r e e l o a n s . th e fir st On t h a t For t h e o th e r 1 tw o I had l e f t 2 in to 3 90 Q. 4 A. 5 91 Q. t h e U n i t e d S t a t e s b e f o r e t h e y cam e effect. W here w e r e y o u t a x r e s i d e n t f o r t h e o t h e r t w o ? S p a in . We n o r m a l l y t e l l p e o p l e w h a t we d o n ' t h a v e . I w ill 6 te ll 7 r e c o r d o f A nsbacher e v e r g iv in g you c e r t i f i c a t e s 8 th e 9 e i t h e r i n t h e U n ite d S t a t e s or i n S p a in r e l a t i v e y o u w h a t we d o n ' t y e t h a v e . t h e i n t e r e s t w h ich you e a r n e d . 11 c e r tific a te s? A. 13 92 Q. 14 A. 15 93 Q. I w ou ld im a g in e s o , No. S u r e l y you h a v e a t a x a d v i s e r som ew here. 17 am s a y i n g . Y es, So m e b o d y i s You a r e a you u n d e r s ta n d w hat I a d v i s i n g you? b u t you a r e t a l k i n g about t h in g s t h a t happened a lo n g tim e ago. 19 20 such Do y o u h a v e c o p i e s o f them ? c o m p lic a te d ta x in d iv id u a l i f A. D id y o u g e t 94 Q. No, I am t a l k i n g h a p p en in g i n 21 22 A. 23 95 Q. 24 A. 25 96 Q. That i s 97 Q. about t h in g s t h a t w ere s t i l l 1993? a lo n g tim e a g o . When d i d y o u r e p a y t h e l o a n s ? 1994. Are yo u s a y i n g t h a t you d o n ' t h a v e c o p i e s o f y o u r ta x a f f a ir s A. to yes. 16 18 of k in d t h a t can be p rod u ced t o th e t a x a u t h o r i t i e s 10 12 We d o n ' t h a v e a n y for 1993? N o. Have y o u t h e c a p a c i t y t o g e t them ? 1 98 Q. 2 3 D i d y o u make r e t u r n s o f t h e i n t e r e s t w h i c h w a s on th e d e p o sit? A. 4 No b e c a u s e t h e r e w as no l i a b i l i t y th ose d e p o s its . 5 99 Q. 6 A. 7 1 0 0 Q. 8 A. 9 1 0 1 Q. T h ere was no l i a b i l i t y t o tax? N o. I u n d e r s t o o d t h a t t h e y w e r e i n y o u r own name? C orrect. You a r e s a y i n g t h a t e v e n t h o u g h y o u w e r e t a x 10 r e s i d e n t in th e U n ite d S t a t e s 11 and th e n t a x r e s i d e n t i n 12 tim e , 13 A. 102 Q. 17 A. 18 10 3 Q. 20 A. 21 104 Q. t h e r e w as no l i a b i l i t y ? w hen I w a s t a x r e s i d e n t i n t h e U n i t e d S t a t e s When d i d y o u p u t y o u r d e p o s i t s I i n y o u r own name i n In 1990. From 1 9 9 0 o n w a r d s y o u h a d d e p o s i t s i n Cayman i n y o u r Y es. F orget th e q u e stio n o f t r u s t . r e sid e n t in 22 A. 24 And y o u w e r e t a x S p a in a t t h a t s ta g e ? I w as r e s i d e n t i n S p a i n w hen I l e f t th e U n ite d S t a t e s . 1 0 5 Q. A re you s a y in g t h a t you r e v e r t e d t o b e in g t a x 26 re sid e n t in 27 o p tio n ? 28 o f th e own name? 19 25 S p a in f o r t h e r e s t A nsbacher? 16 23 No, f o r p a r t o f th e tim e d i d n 't have any d e p o s it s w ith A nsbacher. 14 15 t o t a x a n y w a y on A. 1 0 6 Q. Ir e la n d , w h ich o f c o u r s e w o u ld b e y o u r N o. You h a v e t o b e t a x r e s i d e n t so m e w h e r e ? 1 2 Q. You d o n ' t ? 3 A. No, 4 108 Q. 5 6 you a r e i n c o r r e c t on t h a t . W here d o y o u s a y y o u w e r e t a x r e s i d e n t a f t e r le ft A. in 8 h om e. 9 1 0 9 Q. th e U n ite d S ta te s ? I am n o t s u r e 7 I w as t a x r e s i d e n t a n y w h e r e . S p a in b e c a u s e S p a in i s I tak e i t w ere t a x r e s i d e n t now here, 11 th e in t e r e s t A. 13 110 Q. 14 A. 15 111 Q. 17 A. I have a t h a t b e c a u s e you you had now here t o retu rn to? I u n d erstan d t h a t . Y es. For t h a t r e a s o n you w o u l d n ' t h a v e a s k e d them f o r t h e C orrect. in q u e stio n ? I d o n ' t know w h a t y o u m ean b y c e r tific a te s? 18 19 I liv e d Y es. c e r tific a te s 16 th e o n ly p la c e t h e r e f o r e t h a t you f e l t 10 12 you 112 Q. You know w hen y o u w a n t t o p r o v e t h a t y o u h a v e m o n e y 20 on d e p o s i t you g e t a c e r t i f i c a t e 21 s a y i n g t h a t y o u e a r n e d s o much i n t e r e s t . 22 u n d erstan d th a t? 23 A. 24 11 3 Q. 25 A. 26 114 Q. But d i d you g e t c e r t i f i c a t e s 27 A. No b e c a u s e t h e r e w as no t a x . 28 Q. It fr o m t h e b a n k Do y o u Y es. But you d i d n ' t g e t t h o s e c e r t i f i c a t e s ? O b v io u sly I g o t d e p o s it r e c e i p t s . is fo r ta x purposes? n ot a q u e stio n o f th e ta x reco rd s not b e in g a v a ila b le , it is r e a l l y a q u e s t io n you d i d n ' t t h i n k 1 you w ere l i a b l e 2 a n y w h e r e a n d t h e r e f o r e y o u d i d n ' t l o o k f o r th e m ? t o any p a r t ic u la r ta x a u t h o r it y 3 4 1 1 6 Q. 5 A. 6 117 Q. Y es, 7 A. Y es. 8 118 Q. 9 A. 10 1 1 9 Q. 11 A. 1 2 0 Q. 15 A. 16 1 2 1 Q. You a r e t a l k i n g a b o u t t a x c e r t i f i c a t e s ? th a t is w h a t I am t a l k i n g a b o u t ? What w as y o u r m o t h e r ' s name? M a b el E n o c h . Who w as A nne E n o ch ? A nne E n o c h w a s my g r a n d m o t h e r who d i e d a l o n g t i m e You d o n ' t know who t h e b e n e f i c i a r y o f A nne E n o c h ' s N o. H ave y o u r e c e i v e d a n y m o n ey fr o m a n y A nne E n o c h T r u s t ? 17 18 A. 19 122 Q. 20 A. 21 1 2 3 Q. 22 A. 23 124 Q. 24 A. 25 12 5 Q. 26 A. No. The Tabm ount C o r p o r a t i o n y o u s a y w as o w n ed b y ? I d o n 't know. N o t b y y o u a n y w ay ? N o. You h a d no i n t e r e s t No i n t e r e s t in it in it ? at a ll. D i d y o u know a n y t h i n g a b o u t t h e i r p r o p e r t y ? N o. I am a w a r e o f p r o p e r t y t h a t t h e y o w n e d a l l r ig h t. 27 29 summary o f i t ? T rust is ? 14 28 th a t a fa ir ago. 12 13 Is 1 2 6 Q. You know a b o u t t h e i r p r o p e r t y b u t y o u d o n ' t know who 1 A. 2 1 27 Q. 3 4 No, I d o n 't know who t h e o w n e r i s . We know t h a t G i r a r d I n v e s t m e n t s a r e o w n ed p a r t i a l l y b y you? , 5 A. 12 8 Q. 6 A. 8 1 2 9 Q. 9 And t h a t i t h a s no c o n n e c t i o n w it h t h e N o t t o my k n o w l e d g e , I th o u g h t i t k n o w led g e. 10 no. w as n o r a t h e r t h a n n o t t o y o u r Has i t a c o n n e c tio n w ith th e A nne E n o c h T r u s t o r d o e s i t A. 12 13 yes. A nne E n o c h T r u s t ? 7 11 W e re, I d o n 't know . n ot? I t h a s no c o n n e c t i o n a s f a r a s I am concerned. 1 3 0 Q. W ould i t s u r p r is e you t o know, Mr-. E n o c h , th a t in 14 t h e r e c o r d s o f G u i n n e s s & Mahon t h e r e i s 15 a t t a c h i n g a s c h e d u le w h ich a p p e a r s t o be a s c h e d u l e 16 o f i t e m s o w n e d o r c o n t r o l l e d b y t h e A nne E n o c h T r u s t 17 w h i c h i n c l u d e s Tabm ount C o r p o r a t i o n a n d 18 G ira rd I n v e s tm e n ts L td . 19 E x h ib it A. 1 3 1 Q. 22 23 That i s lo o k a t 314 t o 316. Y es. 317 i s o n ly a r e p e t i t i o n of 316. A. C o u l d we h a v e a b r e a k s o I c a n c o n s u l t ? 24 W o u ld n 't i t 25 b e f o r e th e b rea k so t h a t you can a l s o 26 th a t. 27 MR. SHIELDS: T h e r e w as a l e t t e r 28 29 to 1? 20 , . 21 Would y o u l i k e a le tte r b e a s w e l l t o p u t o n e m ore t h i n g t o c o n s u l t on referred to o f 5th A p r il 1 9 8 8 fr o m G u i n n e s s & Mahon. you 1 2 Do y o u know a n y t h i n g a b o u t F o u n t a i n D e v e l o p m e n t s ? 3 A. 4 13 3 Q. 5 A. 6 134 Q. No. Do y o u know w h e t h e r t h e y ow ned p r o p e r t y a n y w h e r e ? I h a v e n e v e r h e a r d t h a t name b e f o r e . F o u n ta in D ev elo p m en ts w ere g r a n te d a lo a n fa c ility 7 o f $ 7 0 , 0 0 0 b y G u i n n e s s & Mahon i n O c t o b e r 1 9 8 8 t o 8 f i n a n c e a h o u s in g d ev elo p m en t i n 9 The s e c u r i t y w a s a s e t - o f f 10 in 11 A. 12 135 Q. G u in n ess N o, & Mahon. fr o m a n A n s b a c h e r d e p o s i t You know n o t h i n g a b o u t t h a t ? I n e v e r h e a r d t h e name b e f o r e . Do y o u know a n y t h i n g a b o u t a h o u s i n g d e v e l o p m e n t i n F lo r id a ? 13 14 A. 15 1 3 6 Q. No. Were y o u i n v o l v e d i n a n y way i n a h o u s i n g d ev elo p m en t i n 16 17 A. 18 13 7 Q. 19 A. 20 138 Q. 21 A. 22 1 3 9 Q. F lo rid a ? N o. Or a n y m em bers o f y o u r f a m i l y t h a t y o u a r e a w a r e o f ? Not t h a t I am a w a r e o f . A r e y o u f a m i l i a r w i t h t h e name M - A - N - I - H - A - N - I ? N o, I never heard o f i t . MS. MACKEY: The j u d g e i s a sk in g , do y o u know a n y t h i n g a b o u t 23 M a n u f a c t u r e r s H a n o v e r Bank? 24 25 F lo r id a . A. Y es. I b e lie v e 26 p a id i t s 27 nam es q u i t e th at is where G ira rd I n v e s tm e n ts i n t e r e s t paym en ts. o ften . v T hose b a n k s ch a n g e 1 F o u n ta in D e v e lo p m e n ts you m ig h t a l s o 2 tw o f u r t h e r d o cu m en ts w h ich I w i l l g i v e you 3 to 4 back I w i l l 389. lik e to lo o k a t — 370 We w i l l b r e a k f o r c o f f e e a n d w hen I com e a sk you ab ou t t h o s e , p a r tic u la r ly 389. 5 6 SHORT ADJOURNMENT 7 8 9 1 4 1 Q. JUDGE O'LEARY: Can we t u r n t o t h e 10 Tabmount C o r p o r a t i o n . 11 Do y o u know a n y t h i n g a b o u t t h a t ? 12 MR. ENOCH: There i s 13 lik e to s o m e th in g I w o u ld s a y b e f o r e we g o 14 on. 15 r e la tio n 16 C o r p o r a t i o n a n d t h e A nne E n o c h t r u s t . 17 make i t 18 h a v e s a i d b u t I do n o t have any o w n e r sh ip i n t e r e s t 19 i n them and t h e r e f o r e 20 answ er q u e s t i o n s 21 is 22 c o u l d p e r h a p s b e a d d r e s s e d t o my f a t h e r who i s 23 u n f o r t u n a t e l y o l d and n o t i n good h e a l t h . 24 1 4 2 Q. I t m ig h t a p p ea r t h a t I have b e e n v agu e i n t o M a rtin a I n v e s tm e n ts L td, c le a r th a t Tabm ount I w ish t o I am a w a r e o f t h e s e e n t i t i e s I am n o t i n a p o s i t i o n i n r e l a t i o n t o them . th a t q u e stio n s in r e la tio n to th ese as I to The r e a l i t y e n titie s You w i l l h a v e n o t i c e d t h a t when y o u t o l d u s a b o u t 25 M a rtin a I n v e s t m e n t s , I dropped t h a t . I h a v e no 26 o t h e r q u e s t i o n s t o a sk you a b o u t t h a t . 27 have q u e s tio n s to 28 Tabm ount C o r p o r a t i o n . 29 y o u r name cam e i n n o t w i t h s t a n d i n g t h e f a c t B u t I do a sk you ab ou t t h e D id y o u s e e t h a t l e t t e r w here t h a t you 1 2 3 143 Q 4 A MR. SHIELDS: W hich l e t t e r ? JUDGE O'LEARY: E x h i b i t 2? A b so lu te ly . T h is i s a c o m p le t e and u t t e r m y s t e r y t o 5 m e. 6 F o u n ta in D ev elo p m en ts i s 7 heard o f . 8 144 Q 9 A 10 11 I am a w a r e o f o u r f a m i l y i n t e r e s t s I have never You t h i n k y o u r name was u s e d i n e r r o r t h e r e ? A b so lu te ly . I n ever heard o f i t . a n y th in g about i t 145 Q so m eth in g t h a t and t h i s I am g o i n g t o I d o n 't know at a ll. g i v e you a n o th e r docum ent a t 12 E x h ib it 3. 13 d o c u m e n t w h i c h we g o t fr o m G u i n n e s s & Mahon a n d i s 14 G u i n n e s s & Mahon i n t e r n a l d o c u m e n t , 15 sou rce o f i t . 16 second. 17 I am s o r r y f o r g o i n g b a c k w a r d s a n d f o r w a r d s . 18 lo o k a t E x h ib it 2 a g a in , 19 little 20 A. 21 146 Q 22 T h is docum ent you d o n ' t h a v e . It is a a s o y o u know t h e I f you l e a v e t h a t t o one s i d e for a If you t h e o n e y o u t h i n k y o u know o r n o t h in g about? Y es. You s e e t h e r e w as a l e t t e r referred to in th a t o f 2 4 th January 1991? 23 A 24 14 7 Q Y es. I w onder w o u ld y o u g i v e t h e w i t n e s s (sam e . h a n d e d ) . A 148 Q A 149 Q N o, Is E x h ib it 4 Do y o u rem em ber g e t t i n g t h a t l e t t e r ? not s p e c ific a lly . it p o s s i b l e t h a t you g o t th e l e t t e r , E x h ib it Y es. I t h o u g h t y o u knew n o t h i n g a b o u t F o u n t a i n 27 4? 1 2 A. Whom? 3 Q. F o u n ta in ? 4 A. W here i s 5 1 5 1 Q. It is t h e word f o u n t a i n w r i t t e n i n t h i s not but i f you lo o k a t E x h ib it 2 o f 6 2 2n d Novem ber 1991 you s e e t h a t i t refers 7 a le tte r of 8 2 4 th J a n u ary 1991? 9 152 Q. It from C h r is W h i t e ' s l e t t e r refers here le tte r . " con form in g w ith g u i d e l i n e s th e r e in to g iv en to 10 S t e p h e n E n o ch ." 11 in te r e st. 12 w i t h G ir a r d I n v e s t m e n t s and t h e y w e r e n ' t v e r y 13 e f f i c i e n t w i t h t h e am ount we h a d t o p a y a n d w h e r e we 14 had t o pay i t . 15 i n G u i n n e s s & Mahon t o 16 a n d how i t 17 th ere s t i l l 18 th in g s? 19 1 5 3 Q. 20 21 Maybe t h i s I know t h a t is how y o u a c t u a l l y p a y I used to pay th e in t e r e s t I u sed to have to te le p h o n e p e o p le f i n d o u t w h a t w as g o i n g o n w as p a i d an d w h e r e i t is was p a i d . But no r e l a t i o n s h i p b e t w e e n t h e tw o You t h i n k t h e r e i s no r e l a t i o n s h i p b e t w e e n t h e tw o th in g s? A. I know t h e r e isn 't; I have n ever heard o f 22 F o u n t a i n D e v e l o p m e n t s a n d a s f a r a s I know n o n e o f 23 o u r f a m i l y m em bers h a v e h a d e v e r h a d a n y i n v o l v e m e n t 24 w it h F o u n ta in D ev elo p m en ts o r F lo r id a o r a n y t h in g i n 25 F lo r id a . 26 Q. W ould y o u t u r n now t o t h e Tabm ount C o r p o r a t i o n a t 27 E x h i b i t 3 w h ich you a lr e a d y h a v e . 28 a b o u t t h e Tabm ount C o r p o r a t i o n . 29 th a t? R em ind me a g a i n A re you i n v o l v e d i n 1 A. N o, th is is a c tu a lly in co rrect. The f i r s t statem en t 2 on t h e t o p o f t h a t w h ich s a y s 3 a r e V i c t o r Enoch, h is 4 f a m i l y m e m b e r s ." I am n o t a b e n e f i c i a l o w n e r s o f a r 5 a s I know. 6 to g e th e r in t h e ir 7 purposes. 8 15 5 Q. 9 A. 10 1 5 6 Q. 11 A. 12 157 Q. 13 A. 14 158 Q. You d o n ' t " th e b e n e f i c i a l ow ners so n S te p h e n Enoch and o t h e r T h e y s e e m t o lump a l o t o f th in g s correspondence fo r t h e ir own know a n y t h i n g a b o u t Tabmount C o r p o r a t i o n ? I am a w a r e o f i t . Do y o u know who t h e o w n e r s a r e ? No, n o t th e l e g a l ow ners. Do y o u know who t h e b e n e f i c i a l o w n e r s a r e ? N o. I d i d n ' t do a n o t e o f i t . It is in th e tr a n s c r ip t 15 b u t I am s u r e y o u w i l l rem em ber i t . 16 you becom e a d e p o s i t o r y o u r s e l f i n A n sb a ch er? 17 A. 18 1 5 9 Q. 19 A. June 1 990. Have y o u a n y comment t o make o n E x h i b i t 5? Y es, th e f i r s t s t a t e m e n t s o f a r a s I am a w a r e i s 20 in c o r r e c t, 21 S t e p h e n E n o c h a n d f a m i l y m e m b e rs, 22 sa id b e fo r e . 23 16 0 Q. What d a t e d i d t h a t t h e b e n e f i c i a l ow n ers a r e V i c t o r and t h e sam e a s i t So f a r a s y o u a r e c o n c e r n e d y o u a r e n o t a b e n e f i c i a l o w n e r i n Tabm ount? 24 25 A. N o. 26 161 Q. 27 A. No. Q. O b v i o u s l y t h i s m i g h t b e o n e com pany o w n ed b y a n o t h e r Or a n y o f i t s com pany. o ffsh oo ts? The u l t i m a t e b e n e f i c i a r i e s d o n 't in c lu d e 1 2 3 163 Q 4 A S u r e l y you w o u ld be aware o f i t ? N o. As I s a i d t o you b e f o r e , th e se q u e stio n s 5 p e r h a p s s h o u l d h a v e b e e n a d d r e s s e d t o my f a t h e r . 6 I f y o u knew my f a t h e r , 7 He d o e s w h a t e v e r h e d o e s . 8 16 4 Q When y o u s a y n o , do y o u mean n o , b e n e f ic ia r y or no, 9 my f a t h e r i s h is own m an. you a re n o t a you w o u ld n 't b e q u i t e sure 10 b e c a u s e y o u c o u l d h a v e b e e n made a b e n e f i c i a r y 11 w i t h o u t y o u r k n o w led g e? 12 A It is p o ssib le 13 k n o w led g e. 14 am n o t , 15 16 5 Q I w as made a b e n e f i c i a r y w i t h o u t my I h a v e no k n o w l e d g e w h e t h e r I am o r I s o I d o n ' t know. P resu m a b ly y o u r f a m i l y i s lik e ev ery o th e r fa m ily , 16 a s y o u g e t o l d e r y o u t a k e m ore an d m o re 17 r e sp o n sib ility from yo u r f a t h e r ? One w o u l d l i k e to th in k th a t, 18 A yes. But i f y o u knew 19 my f a t h e r a s I know my f a t h e r y o u w o u l d n ' t 20 n e c e s s a r ily say th a t. 21 f a t h e r c o u l d p u t me a s a b e n e f i c i a r y a n d t h e n e x t 22 day put th e c a ts 23 he f e l t 24 166 Q 25 A It is It t h a t my so in c lin e d . p o ssib le C e r ta in ly i t is you a r e a b e n e f ic ia r y ? p o ssib le , t o s a y I h ope I m ig h t b e . 27 id e a . 167 Q q u ite p o s s ib le an d d o g s home a s t h e b e n e f i c i a r y i f 26 28 is I d o n 't b e lie v e yes. I w ou ld go f u r t h e r B ut I r e a l l y h a v e n o ■ in h id in g th in g s from p e o p l e . 1 What i n t e r e s t s me w i t h r e g a r d t o t h e s e v a r i o u s 2 is th e f a c t t h a t th e y appear t o have been ta k e n out 3 in D u b lin , 4 th e y ap pear to have been backed by A nsbacher 5 d ep o sits? 6 R ig h t. 7 168 Q 8 9 i n G u i n n e s s & Mahon i n D u b l i n , Who w as y o u r c o n t a c t lo a n s and t h a t fo r a r r a n g in g t h o s e lo a n s in D u b lin o v e r th e y e a r s? A John C o l l i n s i n A n s b a c h e r Cayman. I n e v e r had any 10 d e a l i n g s w h a t s o e v e r i n D u b lin o t h e r th a n on paym ent 11 of in te r e st 12 done th r o u g h John C o l l i n s . 13 it 14 t h e Cayman o n e ow ned t h e D u b l i n o n e . 15 G u in n ess 16 & Mahon ow ned t h e Cayman o n e o r why t h e y d i d i t 17 way. 18 169 Q was a l l and i n v o i c e s and t h i n g s . t h e one com pany. I t a p p e a r e d t o me t h a t I d o n ' t know w h e t h e r & Mahon i n t h o s e d a y s . But you do u n d e r s ta n d t h a t b e c a u s e t h e lo a n s w ere 20 d e p o sits, th a t th ey are r e le v a n t to 21 e n q u ir y . Do y o u u n d e r s t a n d t h a t ? 23 170 Q th a t I h a v e no i d e a . tak en out in A I t was Or w h e t h e r G u i n n e s s 19 22 E v e r y t h i n g w as Y es. I r e l a n d an d b a c k e d b y A n s b a c h e r th e A nsbacher . I w o u ld n 't l i k e y o u t o t h i n k t h a t we a r e p r y i n g i n t o 24 your a f f a i r s ju st fo r th e sake o f p r y in g in t o 25 a ffa ir s. 26 e n title d 27 num ber o f q u e s t i o n s 28 to T here i s a reason fo r i t . t o be t o l d t h a t . ask you. your You a r e I t h i n k Ms. M ack ey h a s a a lo n g t h a t l i n e t h a t sh e w an ts 1 m a tte r s t h a t w ere r a is e d 2 e a r lie r 3 out a l i t t l e 4 p r e lim in a r y can I ask you, 5 been in p a r tn e r sh ip 6 s i n c e y o u m o v e d fr o m I r e l a n d ? 7 A. 8 1 7 2 Q. 9 in t h is i n t e r v i e w t h a t I w ou ld l i k e b i t m ore an d c l a r i f y . to te a se As a h a v e you and y o u r f a t h e r in b u sin ess in th e U n ite d S t a t e s N o. You d i d n ' t w ork t o g e t h e r w i t h y o u r f a t h e r i n any c o n n e c tio n ? 10 A. 11 1 7 3 Q. N o. I n s o f a r a s d o c u m e n t s s u c h a s t h e o n e s we h a v e j u s t 12 sh o w n y o u now i n d i c a t e t h a t y o u a n d y o u r f a t h e r 13 t o g e th e r to o k out lo a n s 14 c a p a c ity , 15 A. 17 do you s a y t h a t i s Yes b e c a u s e i t is 17 4 Q. in c o r r e c t? my b e l i e f t h a t my f a t h e r h a s n e v e r done a n y th in g in h is 16 fr o m G u i n n e s s & Mahon i n a n y own nam e. So t h a t w hen a g a i n G u i n n e s s & Mahon d o c u m e n t s s p e a k 18 o f t h e E nochs o r V i c t o r and S te p h e n E noch, 19 say th a t i s 20 A. 21 1 7 5 Q. do y o u j u s t your f a th e r a lo n e in r e a l i t y ? You w o u l d h a v e t o b e m ore s p e c i f i c . For e x a m p le , t h e tw o d o c u m e n t s t h a t y o u l o o k e d a t a 22 f e w m om en ts a g o — E x h i b i t 3 a n d E x h i b i t 5 — 23 r e la tio n 24 A. 27 t o Tabm ount C o r p o r a t i o n ? I h a v e h a d n o i n v o l v e m e n t w i t h Tabm ount C o r p o r a t i o n at a ll. 25 26 in 1 7 6 Q. T here i s a sta te m e n t in b oth o f th o s e th a t T a b l e m o u n t NV — w h i c h i s Tabm ount — i s t h e p a r e n t co m p a n y o f ow ned b y a num ber o f t r u s t s o f w h ich t h e b e n e f i c i a l ow n ers a r e V i c t o r and S te p h e n Enoch 1 a n d o t h e r f a m i l y m e m b e r s. 2 your f a t h e r ' s . 3 y o u r k n o w led g e you a r e n o t a b e n e f i c i a l owner a t a l l 4 o f any o f t h e s e t r u s t s . 5 what you s a id ? 6 T h a t's c o r r e c t , 7 17 7 Q 8 A 9 1 78 Q 10 A 11 12 fa c t to th e b e s t o f Is th a t c o r r e c t, is th at yes. What do y o u mean a n y t r u s t , It any o f t h e s e t r u s t s ? s a y s h e r e a num ber o f t r u s t s ? I am n o t a w a r e o f w h e t h e r I am. I t d o e s n ' t m ean t o I am n o t . You a r e n o t a w a r e o f b e i n g a b e n e f i c i a r y o f a n y tru st? 13 14 A 15 180 Q 16 A C e r ta in ly not th e se ones. What a r e t h e s e o n e s ? You a r e t a l k i n g a b o u t Tabm ount o r T a b le m o u n t ? They a r e n o t r e a l l y 17 18 You s a y t h a t i n lin k e d w ith Of any t r u s t ? say th a t 179 Q Your name i s 181 Q No, tru sts I d o n 't th in k . th e y d o n 't appear to be t r u s t s . 19 The s t a t e m e n t h e r e s a y s t h a t Tabmount C o r p o r a t i o n i s 20 ow n ed b y T a b le m o u n t NV. 21 com pany, 22 is 23 V i c t o r and S te p h e n Enoch a r e t h e b e n e f i c i a r i e s ? 24 A We h a v e t h i s p a r e n t T a b le m o u n t o w n in g T abm o unt. T a b le m o u n t NV i n t u r n o w n ed b y a num ber o f t r u s t s I am n o t a w a r e o f t h o s e t r u s t s o f w h ich at a ll. 25 are, 26 T h a t l e a d s me o n t o t h e m a in q u e s t i o n 27 you. 28 Judge O 'L ea ry a sk e d you a b o u t a t r u s t , What t h e y who t h e y a r e o r who ow ns t h e m . At th e b e g in n in g o f t h i s I w an ted t o in te r v ie w t r u s t had b e e n form ed a f t e r you l e f t w hether a Ir e la n d ? ask 1 2 You s a i d y e s , a Cayman t r u s t w as f o r m e d b y y o u a s 3 u n d erstan d i t w hen y o u w e r e i n t h e S t a t e s , 4 correct? 5 Q. A. 6 7 184 Q. I am n o t s u r e when I f o r m e d a You a r e n o t s u r e w h en , I th ou gh t i t was a f t e r you w ent t o t h e S t a t e s ? A. C e r ta in ly i t w as a f t e r 10 c e r ta in because 11 w ith A nsbacher. 12 185 Q. 13 A. I le ft Irela n d . T h a t I am I n e v e r had any d e a lin g s w h a tso e v e r What w as t h a t t r u s t ? I t w o u ld h a v e b e e n a g e n e r a l t r u s t needed i t 14 D id i t 1 8 6 Q. 16 A. C e r ta in ly i t h a d a nam e. 17 18 7 Q. Can y o u t e l l me w h a t t h e name w as? 18 A. No, fo r w h atever I f o r a t th e tim e or in th e f u t u r e . 15 h a v e a name? because I a c t u a l l y c a n n o t rem em ber w h a t i t w as c a lle d . 19 20 th at tru st. 8 9 I form ed a t r u s t , is I 188 Q. Can y o u t e l l me how i t 21 form ed. 22 set T ake i t up a t r u s t came a b o u t t h a t t h e t r u s t w a s s t e p by s t e p : Who a d v i s e d y o u t o i n Cayman? 23 A. E i t h e r Don R e i d o r J o h n C o l l i n s . 24 18 9 Q. 25 A. N o. 26 Q. D id y o u g o t o o n e o r o t h e r o f th e m a n d a s k a d v i c e o r You a r e n o t s u r e w h ic h ? 27 d i d t h e y a p p r o a c h you and s u g g e s t t h e s e t t i n g 28 th is tru st? up o f 1 19 1 Q 2 A 3 192 Q 4 A 5 6 I d o n 't know. R o u g h ly ? S o m e t im e i n t h e 1 9 8 0 ’s or 1 9 9 0 ’s , know. 19 3 Q I t was l i k e l y t o be b e tw e e n 1980 and 1990 f o r 7 ex a m p le. 8 P e r h a p s y o u c a n rem em ber i t 9 1979? 10 A Was i t lo n g a f t e r you w ent t o I have a f e e lin g it cannot r e a lly 12 p a r tic u la r ly s ig n ific a n t. 13 194 Q 14 A 15 195 Q rem em ber b e c a u s e i t Then i t w o u ld be r e l a t i v e l y v i v i d 17 and i f 18 memory o f i t . 19 tru st? n o t so m e th in g y o u r se lf? It is i n y o u r m in d I n o t a t h in g one d oes ev ery d a y y o u h a v e o n l y c r e a t e d o n e y o u w o u l d h a v e som e D id y o u f e e l a n e e d t o I m ust h a v e b e e n a d v i s e d t h a t i t 21 do i t . 22 th ese tr u sts 196 Q You w e n t i n Y es. w o u ld im a g i n e . 23 is D id y o u o n l y e v e r c r e a t e o n e t r u s t 16 A t h a t way. th e S ta te s . i s m ore r e c e n t t h a n t h a t b u t I 11 20 I r e a l l y d o n ’t s e t up a w as a g o o d i d e a t o But q u i t e h o n e s t l y I d o n ’t r e a l l y u n d erstan d a n d w h a t t h e y do a n d how t h e y o p e r a t e . You w e r e a d v i s e d e i t h e r b y Don R e i d o r b y 24 John C o l l i n s t h a t it w o u ld b e a g o o d i d e a t o do 25 th is. 26 th ey e x p la in i t 27 A fter 28 w o u ld h a v e a t r u s t t h a t on e c o u l d p u t a s s e t s What d i d t h e y t e l l I le ft you a b o u t i t o r how d i d t o you? th is one w o u ld l e a v e t o c o u n t r y t h e i d e a was t h a t one in th a t o n e s c h i l d r e n o r so m e th in g w h ich 1 2 Q. 3 b e i n t h e Cayman I s l a n d s ? 4 A. 5 198 Q. 6 A. 7 19 9 Q. 8 A. 10 2 0 0 Q. 12 A. 17 18 19 20 21 22 23 24 25 26 27 28 29 No. D id you s i g n a t r u s t deed ? I r e a lly d o n ' t h a v e much r e c o l l e c t i o n D id you r e c o l l e c t N o, o f th e t r u s t . I r e c e iv e d a n y th in g or d id 2 0 1 Q. s ig n in g a t r u s t deed? I .d o n 't r e c o l l e c t tr u s t deed i s . 13 16 Was t h e r e a n y r e a s o n g i v e n f o r t h a t s p e c i f i c a l l y ? a n y th in g . 11 15 Y es. I am n o t c e r t a i n i f 9 14 D id t h e y s u g g e s t t o you a t t h a t s t a g e t h a t t h e t r u s t A d ocu m en t. docum ent? sig n in g . I w o u ld h a v e t o O b v io u sly i t is I d o n ' t know w h a t a see one. some k i n d o f l e g a l 1 A. I presum e t h e r e m ust have b een so m e th in g o r o t h e r 2 w hen y o u s e t 3 up s i g n s t h e s e 4 2 0 2 Q. 5 A. 6 7 8 up b u t w h e t h e r t h e p e r s o n s e t t i n g th in g s or n o t, I t w as n o t y o u r s e l f who s e t i t Y es, I d o n 't up, I see, w as i t n ot? A. 10 204 Q. a n y th in g or d o e s n 't s ig n a n y th in g . y o u d o n ' t know w h e t h e r t h e I d o n ' t know t h e m e c h a n i c s o f t h e w h o l e t h i n g . Do y o u rem em b er w r i t i n g a L e t t e r o f W i s h e s 11 i n d i c a t i n g w h a t w o u ld h a p p e n t o t h e e v i d e n c e i n 12 T ru st? 13 A. 14 2 0 5 Q. 15 A. 16 2 0 6 Q. 17 A. 18 207 Q. 19 A. 20 20 8 Q. 21 A. 22 2 0 9 Q. Y es. You d o . Y es. Do y o u h a v e a c o p y o f t h a t ? N o. What h a p p e n e d t o it? I t w ou ld b e w it h A n sb a c h e r. And do y o u n o t h a v e a c o p y y o u r s e l f ? No, because I know w h a t i t c o n ta in s. P e r h a p s y o u w o u l d n ' t m in d t e l l i n g me w h a t i t A. B a sic a lly i t w ou ld c o n t a i n i f I d ie d and w h a te v e r 25 a s s e t s w e r e i n T r u s t w o u l d g o t o my w i f e a n d 26 my w i f e d i e s t o my c h i l d r e n . 27 r e a lly . 29 th e co n ta in ed ? 23 28 it p e r s o n . . . . (INTERJECTION). 9 24 it know. b u t I d o n ' t know w h e t h e r t h e p e r s o n s e t t i n g up s i g n s 2 0 3 Q. it 2 1 0 Q. so t h i s A b it w as t h i s lik e L ik e a W i l l , yes, o f W ish es. D id you a t t h e t im e t h a t t h i s w hen a W ill was y o u r L e t t e r T r u s t w as 1 s e t up, 2 L e t t e r o f W ish es o r n o t , 3 to 4 P o s s ib ly o v er a p e r io d o f tim e, 5 211 Q 6 w h eth er you s ig n e d so m eth in g o t h e r th a n t h e d id you th e n t r a n s f e r th e T ru st? yes. And how w as t h a t d o n e ? MR. SHIELDS: C ou ld I h a v e a m in u t e , 7 p le a se , 8 fu n d s JUDGE O'LEARY: w i t h my c l i e n t ? C e r ta in ly . 9 10 A SHORT ADJOURNMENT 11 12 THE INTERVIEW COMMENCED, AFTER THE SHORT 13 ADJOURNMENT, AS FOLLOWS: 14 15 A s e e m s t o me t h a t y o u a r e d e l v i n g i n t o my p e r s o n a l a ffa ir s 16 17 It 212 Q a fter I le ft th is MS. MACKEY: cou n try. N o, Mr. E n o c h , I am d e lv in g in t o your p e r so n a l 18 19 a ffa ir s, 20 it 21 w h ich i s in d eed t h a t ' s r e la te s correct, but o n ly in s o f a r as t o t h e com pany t h a t we a r e i n v e s t i g a t i n g A nsbacher. 22 23 Now, 24 very b e g in n in g , 25 th is 26 but i f 27 now a n d I w o n ' t a s k y o u a n y m ore q u e s t i o n s 28 Is 29 it in is f a c t perhaps I sh o u ld have ask ed you a t th e I to o k i t a Cayman T r u s t , it is it fo r gran ted th a t b ecau se is an A n sb a ch er T r u s t , n o t an A n s b a c h e r T r u s t , n o t an A n sb a ch er T ru st? t e l l me t h a t about i t . 1 Q. I t was s e t u p . W ell i n t h a t c a s e i t c o n c e r n s me 2 and I m ust a s k you a b o u t i t . 3 a ssets 4 g u a r a n te e or t o back a lo a n ta k e n o u t by you h e r e in 5 I r e la n d ? in th is 6 A. 7 214 Q. Not a t a l l ? 8 A. Not a t a l l . 9 2 1 5 Q. T ru st, When y o u w e r e a d v i s e d a b o u t t h e s e t t i n g up o f t h i s T ru st, 11 life tim e , 12 a n y m eans w h a t s o e v e r ? A. 14 2 1 6 Q. 16 A. 17 217 Q. 18 A. 2 1 8 Q. 21 I am a w a r e o f , A. 23 2 1 9 Q. 24 A. I th in k so , 2 2 0 Q. no. day, is t h a t t h e w ay i t w a s? yes. No d i s t r i b u t i o n s w h a t s o e v e r h a v e b e e n made? I d o n 't is know, it n o t so m eth in g I pay p a r t i c u l a r l y to or i s a very s ig n ific a n t You d o n ' t know a n y t h i n g a b o u t i t . Not r e a l l y , am ount. Does A n sb a c h e r fr o m t i m e t o tim e? no. So how w o u l d y o u f i n d o u t w h a t s t a t e I d o n 't b e lie v e sig n ific a n c e 25 T ru st by fu n d s w ere p u t i n t o t h e T r u st and t h e r e t h e y sen d you s t a t e m e n t s a b o u t i t 22 26 not th at So t h e d u r in g your u s e th e fu n d s t h a t w ere i n t h i s much a t t e n t i o n 19 20 N o, w ere you a d v is e d t h a t you c o u ld , sta y to t h is 15 w ere th e y u se d a t any s t a g e t o No. 10 13 D id t h e T r u s t o r t h e th is t h in g s w ere in ? T r u s t d i d a n y t h i n g o f much so I d o n 't th in k I had any r e a s o n t o . When y o u s a y " i t d i d n ' t h a v e much s i g n i f i c a n c e " , w h a t d o y o u m ean b y t h a t ? 27 28 A. 29 2 2 1 Q. I am n o t s u r e i t But i t d i d a n y t h i n g much o f a n y t h i n g . h o ld s a s s e t s p resu m a b ly ? 1 2 Q. 3 It w ou ld h a v e h e l d a s s e t s . A. 5 2 2 3 Q. N o, it p ro b a b ly s t i l l A nsbacher i t 7 A nsbacher, 8 A. 9 2 2 4 Q. 10 A. 12 225 Q. w as d o n e r e a l l y t o i n t r o d u c e y o u t o to t h e Bank i t s e l f ? Y es. How d i d t h a t a r i s e ? S tates; 11 h o ld s a s s e t s . You t o l d u s t h a t when y o u f i r s t made c o n t a c t w i t h 6 is th at You w e r e a t t h i s 14 A. 15 2 2 6 Q. 16 A. 17 227 Q. in th e correct? Y es. And d i d y o u know Mr. R e i d b e f o r e y o u w e n t t o t h e Y es. I see. Was h e y o u r t a x a d v i s e r h e r e i n Ir e la n d ? Yes he w a s. D i d h e c o n t i n u e t o b e y o u r t a x a d v i s e r w hen y o u w e n t to th e S ta te s? 18 A. 20 N o t a s much b u t , a c e r ta in 22 8 Q. 22 c e r t a i n l y y es he d id , la w , A. N o. 24 2 2 9 Q. So, 25 A. to t o U n ite d S t a t e s R evenue d id he? w h at, to Ir ish R e v e n u e la w ? He d i d n ' t r e a l l y h a v e much t o do w i t h i t . 26 w hen I w e n t a f t e r t h e 4 y e a r s , 27 in v estm en ts, Q. I suppose, ex ten t. He a d v i s e d y o u i n r e l a t i o n 23 28 sta g e S ta tes? 13 21 no lo n g e r does? 4 19 D o e s t h a t m ean i t w hen I w a n t e d t o make I w e n t t o Don R e i d . A f t e r what 4 y e a r s ? I th in k 2 Q. In I r e la n d ? 3 A. Yes a f t e r 4 2 3 2 Q. 5 Y es, I le ft. s o yo u r a s s e t s w ere h e r e . I r e la n d w ere b lo c k e d ; 6 A. 7 2 3 3 Q. 8 A. 9 23 4 Q. A ssets in A. 12 2 3 5 Q. Y es. JUDGE O'LEARY: T h i s w as f o r E x c h a n g e Y es. MS. MACKEY: And a t t h e e n d o f t h o s e years, 4 y o u a s k e d Don R e i d f o r a d v ic e ? 14 A. I am n o t s u r e when I a c t u a l l y w e n t a n d a s k e d h im f o r a d v ic e . 16 17 2 3 6 Q. 18 A. 20 2 3 7 Q. 21 A. 22 2 3 8 Q. He r e c o m m e n d e d t h a t I ta lk to John C o l l i n s w a s a l l G u i n n e s s & Mahon i n th o se days. I t w as c a l l e d G u i n n e s s Mahon Cayman T r u s t , 24 about? Y es, it but i t th a t is w as t h e Cayman Bank we a r e t a l k i n g w a s t h e Cayman B a n k . I n e v e r had any d e a lin g s w h a tso ev er w ith th e I r i s h Q. in & Mahon. I th in k i t correct, 26 a ll. I n A n s b a c h e r Cayman? 23 A. I d o n 't have a tim e s c a le o f i t And w h a t d i d h e a d v i s e y o u ? G u in n ess 19 28 yes. F or 4 y e a r s ? 13 27 in C on trol p u rp oses? 11 25 here th at it? I r e la n d w ere b lo c k e d , 10 15 is Y our a s s e t s Bank. So h e p u t y o u i n t o u c h w i t h G u i n n e s s Mahon Cayman T r u s t t h e Bank i n Cayman w i t h J o h n C o l l i n s t h e r e ? 1 2 I m ean, 3 th em u n t i l 4 b u s i n e s s w i t h th e m a t t h a t s t a g e ? you t o l d us you d i d n ' t have d e p o s i t s w ith 1 9 9 0 b u t w h a t w as t h e n a t u r e o f y o u r 5 A. 6 2 4 1 Q. W it h A n s b a c h e r ? 7 A. W it h A n s b a c h e r , 8 2 4 2 Q. 9 B u t w as i t c o n n e c tio n w ith th e t r a n s f e r of from I r e l a n d t h a t you w ere g e t t i n g in to u c h w ith A nsbacher? A. I d o n 't th in k so , no. 12 d i d i n my own n am e. 13 d o n ' t know t h a t 14 I to o k ou t a lo a n . yes. not in your a s s e t s 10 11 I t w o u ld h a v e b e e n f o r l o a n s . 2 4 3 Q. The a s s e t s it A lm o st e v e r y t h i n g I d i d , I p r o b a b ly form ed a T r u s t b u t I w as u s e d f o r a n y t h i n g . t h a t you had i n Ir e la n d , t r a n s f e r r e d t o A nsbacher a t t h a t 15 16 A. 17 2 4 4 Q. 18 A. w ere t h e y stage? No. They w ere n o t? N o. I m ean t h i s T r u s t w as f o r m e d . I d o n 't th in k 19 o v er th e y e a r s t h a t a n y th in g e v e r happened t o 20 T h i s co m p a n y b e c a m e m o re a c t i v e 21 years. 22 24 5 Q. I am g e t t i n g c o n f u s e d now . 23 t h e tim e o f your 24 T r u s t w as t h e n f o r m e d ? 25 A. 27 28 Q. fir st in th e la st i t . few A re y o u s a y i n g t h a t a t c o n ta c t w ith A nsbacher, I c a n ' t r e c a l l when t h e T r u s t w as f o r m e d , know w hen i t 26 I th e I d o n 't w as f o r m e d . R e a l l y w h a t I am t r y i n g t o t e a s e o u t h e r e i s th e n a tu re o f your f i r s t what c o n t a c t w i t h A n sb a c h e r was? 1 247 Q 2 A 3 248 Q 4 5 A No, no, it w a s p u r e l y a l o a n f o r an i n v e s t m e n t I w as m a k in g i n A m e r i c a o r a s a p a r t n e r s h i p o v e r t h e r e . 249 Q 8 9 T h e r e w as n o q u e s t i o n o f a d e p o s i t o r a T r u s t a t th a t sta g e? 6 7 Y es. And t h i s w a s a s a r e s u l t o f Don R e i d a d v i s i n g y o u t o do t h a t ? A Y es. B a sic a lly i t was t o do w i t h r a t e s of in te r e st. 10 T hey h a d m ore c o m p e t i t i v e r a t e s o f i n t e r e s t t h a n 11 w ere a v a i l a b l e 12 250 Q 13 A i n th e U n ited S t a t e s . I see. So t h a t r e a l l y a ll came a b o u t b e c a u s e I w an ted t o 14 b o r r o w som e m o n e y . 15 t h e o l d c o n n e c t i o n s a n d s e e w h a t w as a v a i l a b l e 16 it 17 o r g a n ise d i t . 18 251 Q I th o u g h t I w o u ld go b a c k t o came u p t h a t h e r e c om m en d ed J o h n C o l l i n s a n d t h e y And i t was t h r o u g h John C o l l i n s t h e n t h a t y o u r 19 c o n n e c t i o n w i t h G u i n n e s s & Mahon i n 20 b ein g ? 21 A 22 252 Q Y es, D u b l i n cam e i n t o e v e r y t h i n g b a s i c a l l y came t h r o u g h J o h n C o l l i n s . Can y o u t e l l me why J o h n C o l l i n s a d v is e d you t o tak e lo a n s o u t i n D u b lin ? 23 24 and A No I h a v e n o i d e a . As f a r a s I was c o n c e r n e d i t 25 a ll 26 i n D u b l i n r a t h e r t h a n so m e w h e r e e l s e . 27 253 Q 28 A 254 Q t h e o n e c om p an y a n d I d o n ' t know why t h e y d i d i t R a t h e r t h a n i n A n s b a c h e r Cayman i t s e l f ? Y es. w as 1 y o u g a v e e v i d e n c e t o me 2 t h a t t h e money w h ic h you u l t i m a t e l y p u t i n t h e 3 C ay m a n s, 4 about a t a l l , 5 A n sb a ch er and b e c a u s e i t 6 w h ich A n sb a ch er d e a l t w ith th e m a tte r i s 7 t o me? 8 A. 9 25 5 Q. 10 I s u p p o s e w h ich r e a l l y but i t A. 12 2 5 6 Q. 13 A. 14 2 5 7 Q. Y es, Is 19 A. 20 2 5 9 Q. 21 A. 22 26 0 Q. 23 A. o f concern is a th a t co rrect? Say t h a t a g a in . T hat t h e money w h ich you had i n A n sb a c h e r from 1990 used as s e c u r it y 25 8 Q. t h e w ay i n t h a t t h e e v id e n c e you gave? 16 18 w as A n s b a c h e r , sorry — on, A. was i n T h at t h a t was n e v e r u s e d a s a s e c u r i t y a g a i n s t 15 17 w as t h e r e an d i t Y es. lo a n i n D u b lin ; 11 I am n o t c o n c e r n e d It o r so m etim e aroun d t h e n , t h a t t h a t had n ot b een f o r a lo a n in Ir e la n d ? w as u s e d a s a s e c u r i t y fo r a lo a n in Ir e la n d . I t w a s? Y es. And w as t h a t h i d d e n ? No. How do y o u m ean " h id d e n " ? For t h a t No, f a c t t o be h id d en ? t h e r e w as a b s o l u t e l y n o r e a s o n f o r i t to be h id d en a t a l l . 24 25 2 6 1 Q. 26 A. W e ll, o f course — It p e r f e c t l y o p e n an d l e g i t i m a t e . is T h e r e w as a b s o l u t e l y no r e a s o n w h a tso e v e r t o h id e i t 27 Q. Why t h e n w a s t h e fa c ility le tte r away. t o y o u fr o m 1 2 A. I d o n 't know t h e a n s w e r t o t h a t . T here i s 3 a b s o l u t e l y n o r e a s o n why t h e y s h o u l d n ' t h a v e h a d i t . 4 I t may b e s o m e t h i n g t h a t t h e y may h a v e w a n t e d t o 5 for th e ir 6 s o m e t h i n g I r e q u e s t e d th e m t o d o . 7 a b s o l u t e l y n o r e a s o n why a n y b o d y s h o u l d n ' t 8 h a d a d e p o s i t b e c a u s e I was a n o n - r e s i d e n t i n 9 U n ite d S t a t e s 10 11 reasons, 2 6 3 Q. A. 14 26 4 Q. 16 A. 17 2 6 5 Q. I r e l a n d and t h e r e is know I th e no t a x In Ju n e 1 9 9 0 b e f o r e t h o s e tw o l o a n s w ere t a k e n o u t . And t h e p u r p o s e o f t h o s e l o a n s , R eal E s ta te p art o f th e purpose 19 ta x a f f a ir s A. 21 in v e stm e n t in th e U n ite d S t a t e s . In th e U n ite d S t a t e s is It and f o r t a x p u r p o s e s . n o t h i n g w rong w i t h t h a t b u t i t is as w e ll, There was t o s o r t o u t w a sn 't i t ? a l l p a r t o f t h e o v e r a l l i n v o l v e m e n t o f an in v e stm e n t. 2 66 Q. I see, 23 th a t i t 24 th is A. and i n t h o s e 2 6 7 Q. c ir c u m s ta n c e s you a r e s a y in g w a sn 't a t your r e q u e s t t h a t th e b a ck in g o f l o a n w as k e p t s e c r e t ? A b so lu te ly y es, reason to 26 a b so lu te ly . keep i t T h e r e w a s a b s o l u t e l y no secret. But w o u ld n 't you have had a c o n t in u in g t a x l i a b i l i t y i n th e U n ite d S t a t e s ? 28 29 T here i s B u t w hen w e r e y o u a n o n - r e s i d e n t i n t h e U n i t e d 18 27 not o f t h e l o a n s w as t o ? 15 25 is S ta tes? 13 22 and i n but i t p a y a b le on t h a t d e p o s i t . 12 20 th e ir p r a c tic e s, do A. No. When I b e c a m e r e s i d e n t i n t h e U n i t e d S t a t e s I 1 h a d no f u t u r e t a x l i a b i l i t y 2 E x a c t l y t h e sam e a s i f 3 Ir e la n d in 4 w o rld . 5 t a x on d e p o s i t s . on a n y d e p o s i t i n t e r e s t . I h a d m o n ey s i t t i n g in an y bank o r any bank anyw here i n t h e As a n o n - r e s i d e n t , 6 268 Q 7 A 8 269 Q Never a c i t i z e n ? 9 A I w as a c i t i z e n . 10 270 Q 11 A 12 271 Q But w ere you a c i t i z e n you a r e n o t l i a b l e fo r o f th e U n ited S ta te s ? N o. When d i d y o u c e a s e t o b e a c i t i z e n ? A b o u t t h e sam e t i m e , June 1990 I g a v e i t D o e sn 't th e ta x s it u a t io n up. i n t h e U n i t e d S t a t e s m ean 13 t h a t e v e n t h o u g h y o u y i e l d up y o u r c i t i z e n s h i p , 14 c o n t i n u e t o h a v e som e c o n t i n u i n g l i a b i l i t y 15 tim e ahead? 16 A No I b e l i e v e for you som e t h e y h a v e c h a n g e d t h e l a w a n d I g a v e up 17 my c i t i z e n s h i p b e c a u s e p e o p l e w e r e g i v i n g up 18 c itiz e n sh ip 19 u n d e r s t a n d i n g a t t h e t i m e I g a v e up my r e s i d e n c y , 20 citiz e n sh ip 21 S ta tes. 22 2 7 2 Q. fo r tax rea so n s. But i t is t h e r e w as n o t a x l i a b i l i t y my in th e U n ite d And t h e m o n e y t h a t w as u s e d t o b a c k t h o s e l o a n s 23 w h i c h y o u t o o k o u t i n J u n e 1 9 9 0 w as on d e p o s i t 24 A nsbacher? A. C orrect. 2 7 3 Q. And how l o n g h a d i t been th ere? A. I t w as p u t i n t h e r e for th e s e c u r ity 274 Q. A in How l o n g h a d i t fo r th e lo a n . b e e n t h e r e w as t h e q u e s t i o n ? 1 275 Q 2 A A t t h e sa m e t i m e a s t h e l o a n w a s , 3 se c u r ity 4 t h e p r o p e r t y and a d e p o s i t . 5 276 Q 6 And t h a t w as t h e f i r s t A nsbacher; 7 A 8 277 Q 9 10 fo r th e lo a n . is it w as p a r t o f t h e They r e q u i r e d s e c u r i t y fo r tim e you had a d e p o s i t w it h th a t correct? Y es. But had you a lr e a d y g o t a T ru st i n A n sb a ch er a t th at stage? A I f o r m e d a T r u s t b u t I d o n ' t know when t h a t w a s . 11 W h eth er t h a t was b e f o r e 1990 o r a f t e r 12 c a n 't r e c a ll. 13 it 14 278 Q 15 A 16 279 Q 17 A 18 280 Q But c e r t a i n l y if 1990 I j u s t t h e r e w as a T r u s t , c e r t a i n l y w a sn 't a c t i v e . Can y o u f i n d o u t when y o u f o r m e d t h e T r u s t ? Y e s I am s u r e I c a n . Can y o u l e t u s know? Y es. MS. MACKEY: Are you f a m i l i a r w it h a com pany c a l l e d 19 20 In vestm en ts, 21 A 22 281 Q 23 A 24 282 Q 25 A 26 283 Q D e lto n a Mr. E n o ch ? Y es. What w as D e l t o n a I n v e s t m e n t s ? I t w as a p a r t n e r i n G i r a r d I n v e s t m e n t s . Y es b u t w h a t w as i t a s a com pany? What do y o u mean "w hat w as i t ? " What d i d i t 27 t h e co m p an y? 28 That i s w ere. do? Who w e r e t h e b e n e f i c i a l o w n e r s o f Who w e r e t h e s h a r e h o l d e r s ? s o m e t h i n g I c a n ' t a n s w e r who t h e o w n e r s What i t d i d w as i t p u r c h a se d p r o p e r t y w h ich I 1 2 284 Q. 3 A. 4 2 8 5 Q. Were y o u a b e n e f i c i a l o w n e r o f i t N o, not at a ll. JUDGE O'LEARY: B ut y o u d i d n ’ t 6 b u sin e ss, A. it w a s j u s t a com pany? I w o u ld n 't sa y t h a t , 8 th at 9 who w a s r u n n i n g i t . 10 know w i t h whom y o u w e r e d o i n g 5 7 or a sh a reh o ld er? 28 6 Q. John C o l l i n s , no. it I b e lie v e it is w o u l d s e e m t o me, MS. MACKEY: p o ssib le w a s t h e man B u t y o u d o n ' t know who t h e 11 s h a r e h o ld e r s were? 12 A. 13 2 8 7 Q. 14 A. 15 2 8 8 Q. The s h a r e h o l d e r s , no. You d o n ' t know a t a l l ? That i s your e v id e n c e ? N o. JUDGE O'LEARY: The l o a n i n J u n e 1 9 9 0 , Enoch, 16 is th e r e a l i t y Mr. of 17 w h a t h a p p e n e d on t h a t o c c a s i o n i n r e s p e c t o f l o a n 18 num ber o n e , 19 b o r r o w e d t h a t i n G u i n n e s s & Mahon a n d t h e sam e 20 $ 9 0 0 , 0 0 0 w as p u t on d e p o s i t i n A n s b a c h e r ? 21 A. 22 28 9 Q. 23 A. 24 2 9 0 Q. w h i c h w as f o r $ 9 0 0 , 0 0 0 , W ell t h a t i s what happened? Y es. We w o u l d h a v e s a v e d a l o t th at o r ig in a lly . 26 you p u t i t A. 28 2 9 1 Q. 29 t h a t you Y es. 25 27 is o f tim e i f you t o l d us So y o u b o r r o w e d t h e $ 9 0 0 , 0 0 0 a n d on d e p o s i t i n A n sb ach er? Y es. And y o u b o r r o w e d $ 4 0 0 , 0 0 0 a n d d i d t h e sam e? 1 2 I am n o t s u g g e s t i n g w h e t h e r i t 3 am m e r e l y s a y i n g t h a t 4 on. 5 want t o know a n y t h i n g a b o u t y o u r a f f a i r s , 6 want t o know w h a t t h e com pany w e r e d o i n g . 7 a ll. 8 com p an y w e r e d o i n g a n d v o l u n t e e r e d t h a t , 9 o u t o f h e r e lo n g ago? 10 A 11 293 Q T h a t's a ll I want t o I f y o u a n s w e r e d me b y t e l l i n g I d id n 't know y o u w a n t e d t o T h a t 's what I w an t, 13 d ep o sit" 14 is 15 you f o r t h a t b u t a t l e a s t when i n fact i t I I ju st T h a t's me w h a t t h e we w o u l d b e know t h a t . w as t h e sam e m o n e y . There I am n o t c r i t i c i s i n g I know i t now? O kay. I h a v e n 't any f u r th e r q u e stio n s, 18 JUDGE 0 ' LEARY: 19 g o in g "money w as b e i n g p u t o n n o t h in g wrong w it h t h a t . MS. MACKEY: 17 I b u t I w as a s k i n g y o u a b o u t t h e m oney and y o u w ere s a y i n g A know w h a t i s and I want t o go on n o t b e c a u s e 12 16 w as l e g a l o r n o t ; I th in k 20 Mr. E n o c h . I may h a v e o n e m ore q u e s t i o n . 21 22 Can I t a k e i t 23 w as b o r r o w e d fr o m A n s b a c h e r o r f r o m G u i n n e s s 24 and p u t on d e p o s i t i n A n sb a c h e r , 25 th e in t e r e s t 26 w h a t e v e r p r o f i t t h a t t h e r e w as on t h e p r o p e r t y i n 27 th e U n ited S t a t e s ? 28 A The l o a n ? th a t in resp ect o f th e $ 9 0 0 ,0 0 0 w h ich th at th a t on t h a t w as a l e g i t i m a t e & Mahon $ 9 0 0 ,0 0 0 , charge a g a in st 1 2 Can I a l s o t a k e i t 3 tim e t h a t t h e 4 th e b a ck in g lo a n , 5 U n ite d S ta t e s ? 6 A 7 296 Q 8 A 9 297 Q 10 A th a t i t i n t e r e s t on t h a t l o a n , you l i k e , th e C orrect. And w a s n o t r e t u r n a b l e b y y o u a n y w h e r e ? C o rrect. That i s a c t u a l l y v e r y sim p le? Very s im p le . It is a b s o l u t e l y s im p le and p e r f e c t l y le g a l. 12 e v e n a s k i n g me a l o t 13 h a v e s a i d i n my l e t t e r s 14 th a t 15 was p e r f e c t l y T h is i s why I d o n ' t u n d e r s t a n d why y o u a r e o f th e se th in g s b ecau se, as I a l l t h e way a l o n g t h r o u g h I have b een c o r r e sp o n d in g w ith you, what I d id le g itim a te . And f o r how l o n g d i d y o u own t h a t $ 9 0 0 , 0 0 0 ? 16 298 Q 17 A 18 299 Q U n til 19 A 1994. 20 300 Q 22 if w as n o t r e t u r n a b l e b y y o u i n 11 21 w as y o u r a d v i c e a t t h e For 4 y e a r s r o u g h ly . 19 ? And w h e r e w e r e y o u l i v i n g d u r in g t h a t p e r io d o f tim e? My home w as i n S p a in . 23 I w ent t o i n S p a in , 24 an d I j u s t t r a v e l a r o u n d a l o t . 25 lik e , o f o p e r a t i o n s w as i n S p a i n . 26 p la c e I h a v e a h om e. A 27 30 1 Q 28 A 302 Q liv e And y o u h a v e l i v e d When I l e f t th e U n ite d S t a t e s but b a s ic a lly I am r e t i r e d My b a s e , That i s if you th e o n ly i n S p a in s in c e ? C o rrect. You know n o t h i n g a b o u t t h e Tabmount C o r p o r a t i o n y o u 50 1 2 A. I h a v e no i n v o l v e m e n t , 3 Q. You w e r e n o t a w a r e t h a t i t had a c a s h -b a c k e d lo a n as w e ll? 4 5 A. 6 3 0 4 Q. 7 A. N o, I ha ve no in v o lv e m e n t w h a t s o e v e r . You d o n ' t No. know w h e r e t h a t c a s h b a c k i n g cam e fr o m ? I may h a v e s e e n d o c u m e n t s a b o u t i t 8 tod a y . 9 ones or n o t. 10 no. 3 0 5 Q. lik e th ese I d o n ' t know w h e t h e r I h a v e e v e r s e e n o t h e r MS. MACKEY: Mr. E n o c h , 11 to liv e a f t e r you w ent in th e S ta te s , 12 y o u c o n t i n u e t o h a v e in c o m e w h o s e s o u r c e a r o s e i n 13 th e U n ite d S t a t e s ? 14 A. 15 3 0 6 Q. 16 A f t e r I w ent t o l i v e A f t e r you w ent t o 17 A. 18 307 Q. 19 A. 21 30 8 Q. 22 A. a f t e r y o u g a v e up c itiz e n sh ip ? Were y o u r e q u i r e d t o file t a x r e t u r n s i n t h e US i n Y es. And how l o n g d i d t h a t c o n t i n u e I am n o t a c t u a l l y file d 24 th a t. Q. ta x retu rn s in 1990. I d o n 't D id y o u r i n c o m e c o n t i n u e t o a r i s e S tates 27 t h a t you had th e r e ? A. for? sure but c e r t a in ly 26 29 S p a in , Y es. 23 28 in r e s p e c t o f t h a t in c o m e ? 20 25 th ere? liv e your U n ite d S t a t e s d id Y es. f o r some y e a r s ? It is D id i t p o s s i b l e up t o d isp o se d o f a l l I w ou ld h a v e know a f t e r i n th e U n ited a r ise fr o m p r o p e r t y 1994 b e c a u s e i n th e p rop erty th e r e . 1994 I 1 3 1 0 Q. 2 A. 3 1 1 Q. C e r t a i n l y a f t e r t h a t d a t e t h e r e w o u ld h a v e b e e n So up t o file 5 6 A. 7 3 1 2 Q. 8 Y es. your p r o p e r ty by 1994? no t a x r e t u r n s . 3 4 You d i s p o s e d o f a l l 1994 you w o u ld h a v e had t h e o b l i g a t i o n to ta x retu rn s? Yes I t h i n k s o . T hank y o u . JUDGE O'LEARY: Thank y o u v e r y m u ch . There w i l l be a t r a n s c r i p t 9 10 o f t h e e v i d e n c e a d d u c e d a n d we w o u l d w i s h t h a t y o u 11 w ou ld s i g n i t as b e in g c o r r e c t. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN TERMINATED Ansbacher Limited, P.O. Box 887, Grand Cayman, British West Indies. Dear Sirs, . „ ’ . ANSBACHER LIMITED '. ANNE ENOCH TRUST _ TABMOUNT CORP*^-"'"'^ GIRARD INVESTMENTS LIMITED • -Wa refer to our letter of 16th November and enclose amended schedule to Include property at 7874"Girard Avenue. Xours faithfully, for <3KCNM3SS & MAHON LIMITED. M. LANIGAN-0»KEEFFE JOINT MANAGING DIRECTOR. Agreement Between V. Enoch, Stephen Enoch and- Deltona -Securities Ltd. and {GMCT Ansbacher Ltd. Deposit of $1,250,000 by Ansbacher Ltd. with 6.H. Dublin. W M . m . 1) Deposit by Ansbacher Ltd. • with G.Mi Dublin (Back to Back) • for; $1,550,000. Oct. 12, 1989 for 5 years $1,550,000_ SBC O REg Annual Review. .2) 3) Deed of Trust and Assignment of Renta over Property at 1005 prospect Reef, La Jolla, San Diego. ' Promissory Note, TABrMQUUXjCQSE.. 1) Deposit Ansbacher with GM Dublin 31/12/1986 for 5 years. $3,000,000 $2,900,000 (Back to,Back). Annual Review. v./, FC/MC 8/10/93 ■*s , ; " 24th.January, 1991. CAW/MHC Mr Stephen M. Enoch, 1356 Virginia Way, La Jolla, California 92037, USA. Sear Mr Enoch, * - I refer to your recent correspondence and our telephone ‘ . conversation regarding the cheques you forwarded to Manufacturers *Hanover Trust,* which were not handled in the usual way. . '. I have had the problem followed up with their New York office and unfortunately they are unable to explain which department might have returned the cheques to you. However; they have indicated that you should send cashiers' cheques only to Manufacturers Hanover Trust, 4 New York Plaza, 13th Floor, Funds Transfer, New York, NY 10004-. They also requested that the cheques be made payable to Manufacturers Hanover Trust Account, Guinness & Mahon Limited and hopefully, with future * remittances to our account you should not have any problems. They indicated that their preference would be'to receive funds electronically transferred, quoting the Funds Transfer Section, .but they did say that the processing of cashiers1 cheques does not cause them any problem. . If you have any difficulties at- all when the next payments occur, please do not hesitate to contact me. . Thanking you, Chris Waite, ■ Assistant Banking Manager. Tab Mount Corporation is owned by Tablemount NV. The latter is in turn owned by a-number of trusts of which the beneficial owners are Victor and Stephen Enoch and other family members. The Enochs were originally clients of Guinness Mahon Cayman Trust, now Ansbacher Cayman. They were introduced to G&H i.n the early 1980's by Don Reid, the retired Senior-Tax Partner with KPMG Stokes Kennedy Crowley. ■ ' The Enoch family were resident In Ireland where they owned substantial, property.and a TV. rental business until emigrating to the US in the early 1980's. In the interim the Enochs have built up a sizeable property portfolio in La Jolla, San Diego, California. The property purchases were largely facilitated by loan facilities provided by G&M, which are tax efficient for the Borrowers. The facilities included loans to Mr. and Mrs. Stephen Enoch (net exposure (US$13,000) and a related company Girard Investments (net exposure US$12,500). In all cases the net exposure is guaranteed by Ansbacher Ltd. • T A B MOTJUT L O A N S The Tab Mount loans (net exposure US$46,000) are secured by way of a fixed charge over fully let commercial property in La ' Jolla, recently valued.at US$6a. In addition, we hold the guarantee of Ansbacher Limited for US$46,000. ' The loans were each provided in December 1986 and October 1988 respectively, for a five' year term, subject to annual review. We have now been requested to renew the first loan, subject to the same conditions for a further period of five years (maturity 31.12.1996). It is proposed for convenience to tie-in the annual review dates for both loans in future at 31st December. • ' RErnMMTmmATioijr The Enochs are longstanding, satisfactory clients of Ansbacher Cayman and G&M. Approval of the proposed five year extension is recommended. ' ’ CL/MHC S/3/92 PRIVATE EXAMINATION OF MR. MICHAEL ENOCH UNDER OATH ON THURSDAY, 5TH APRIL 2 0 0 1 I hereby c e r t if y th e f o l l o w i n g t o b e a t r u e and a c c u r a t e t r a n s c r i p t o f my sh orth an d n o te s in th e a b o v e named i n t e r v i e w . S tenographer The I n s p e c t o r s : JUDGE O'LEARY MS. MACKEY BL MR. T. SLEVIN In te r v ie w e e : MR. M. ENOCH R e p r e se n te d by: MR. L. I n s t r u c t e d by: LK SHIELDS SOLRS. SHIELDS 1 2 3 4 JUDGE O'LEARY: Mr. E n o c h , 5 th e o n ly form al part o f th e procedure i s 6 th e q u e s tio n o f th e ta k in g o f th e o a th . 7 lik e We w o u l d you t o ta k e t h e o a th . 8 MR. MICHAEL ENOCH, 9 10 HAVING BEEN SWORN, WAS EXAMINED AS FOLLOWS BY JUDGE O'LEARY: 11 12 1 Q. JUDGE O'LEARY: Mr. E n o c h , fir st co u ld I j u s t 13 ask you about 14 w here you f i t 15 a r e nam es o f E nochs t h a t I h a v e h e a r d a b o u t , 16 j u s t w a n t t o make s u r e t h a t I h a v e y o u i n t h e r i g h t 17 order? 18 A. 20 2 Q. 21 A. 22 3 Q. 23 A. 24 4 Q. 25 A. 26 5 Q. 27 A. 28 6 Q. t h e E noch f a m i l y b e c a u s e t h e r e I am t h e r e s i d e n t E noch i n I r e l a n d . I liv e 19 in to of a ll h e r e a n d I w o rk h e r e . Is your fa th e r V ic to r , T h a t's co rrect, V ic to r i s is th a t co rrect? yes. your fa th e r ? C orrect. You h a v e a b r o t h e r a s w e l l who i s T h a t's r ig h t , And t h e r e i s S tephen. y o u r se lf, Y es. Do y o u h a v e s i s t e r s ? M ich a el? abroad? and I 1 7 Q. 2 A. 3 8 Q. 4 A. 5 9 Q. 6 A. 7 1 0 Q. 8 A. 9 11 Q. 10 A. 11 12 Q. 12 A. 13 13 Q. What w as y o u r m o t h e r ' s name, w as i t N o, t h a t w a s my g r a n d m o t h e r . Y ou r m o t h e r ' s name w a s? I s M a b el. M r s. Enoch s t i l l liv e s That i s correct. And y o u r b r o t h e r l i v e s Y es, he has I n S p a i n o r som e p l a c e l i k e T here i s o n l y o n e t h i n g we w a n t t o t a l k 16 m a tters, 17 ab ou t? 20 th at? Y es. M a rtin a I n v e s t m e n t s . 14 Q. abroad? f o r many y e a r s . 15 19 Irela n d ? Y e s? ab ou t. A. in My m o t h e r ? 14 18 Ann? T h is is th at i s you a com pany b y t h e name o f O ther th a n a few p e r i p h e r a l r e a lly a l l we w a n t t o t a l k t o you F in e. I su p p ose i f we b e g i n a t t h e b e g i n n i n g : Who ow ns t h e com pany? 21 A. That i s a d iffic u lt 22 15 Q. That i s why I a s k y o u b e c a u s e I r e a l i s e a d iffic u lt 23 24 to A. It is one. it m ig h t be one? a com p an y t h a t w as s e t up many y e a r s a g o t o 25 lo o k a f t e r v a r io u s 26 Ir e la n d . 27 perhaps i s 28 t h e p e r s o n on th e ground a s i t 29 a p o w e r o f a t t o r n e y . . . (INTERJECTION). in te r e s ts som e o f w h i c h a r e i n My f u n c t i o n i n r e l a t i o n to i t w h ich m aybe w h a t I c o u l d b e s t a n s w e r i s , w ere h e r e , b e in g I have had 1 16 Q. 2 A. 3 17 Q. 4 A. I have s e e n t h a t i n v a r io u s d ocu m en ts. To s i g n d o c u m e n t s . B u t who do y o u t h i n k owns i t ? W ould i t be e a s ie r i f own i t ? 5 6 18 Q. 7 A. W hatever you l i k e ? P e r so n a lly 8 lik e 9 has a lo t I w o u ld h a v e no i n t e r e s t t o make t h a t v e r y c l e a r . w ou ld be b e n e f i c i a r i e s 11 d e sc r ib e i t . 1 9 Q. th in g s 14 ow ner o f i t 15 m o m e n t. A. 2 0 Q. 20 A. 21 2 1 Q. 22 A. 23 2 2 Q. A. 26 28 29 it o r who t h e w ay t o b e t w e e n tw o d i f f e r e n t f o r g e t t h e b e n e f i c i a l owner f o r t h e Who owns i t . I know t h a t . S om ebody m u s t own i t ? it up say is a ll you y o u d o n ' t know? You d o n ' t a c t u a l l y N o. F a ir enough. N o. know? • Do y o u know who t h e b e n e f i c i a l o w n e r s ' I w o u l d a s s u m e t h a t t h e r e w o u l d b e som e f a m i l y in te r e sts, 2 3 Q. I f y o u d o n ' t know who owns i t , I d o n ' t a c t u a l l y know who owns i t . are? 24 27 is, th a t i s p ro b a b ly I f y o u t e l l me who t h e l e g a l D e fin ite ly but I never se t have t o 19 25 of a ll: if in I w o u ld s o . . . (INTERJECTION). 17 18 fir st it; I th in k i t of it, I s u p p o s e we c o u l d d e f i n e i t 13 16 in o f p e o p l e who h a v e i n t e r e s t s 10 12 I t o l d y o u who I t h i n k d o e s n ' t p o s s i b l y my f a t h e r w o u l d s p r i n g t o m i n d . You t h i n k i t is y o u r f a t h e r who w o u l d b e t h e p r in c ip a l person? I u n d e r s t a n d t h a t you a r e o n ly g o in g on t h e b e s t o f your k n o w led g e. I a p p r e c ia te th a t . H ave y o u a n y b e n e f i c i a l i n t e r e s t i n t h e com pany y o u r s e l f ? N one w h a t s o e v e r . I never have. n e v e r w i l l b e c a u s e I d o n ' t know, W ould i t I cannot sa y I but d e f i n i t e l y no. b e a f a i r a s s u m p t i o n b y me t o lo n g a s your f a t h e r i s in te r e st in it. a liv e say th a t as you w o n 't h a v e an I s t h a t what you a r e c o n v e y in g t o me? T h at i s m ore th a n a f a i r And t h a t That i s a ssu m p tio n . i n d u e c o u r s e y o u may h a v e ? p o ssib le , I u n d erstan d th a t; but I c o u ld n 't be su re o f t h a t . y o u r f a t h e r c a n do w h a t h e l i k e s ? And h e d o e s . That i s th ere very h e lp fu l. is B e f o r e m o v in g o n fr o m t h a t o n e d o c u m e n t I w a n t t o show y o u . I t may a s s i s t us. It is E x h ib it 1. I am g i v i n g y o u v a r i o u s d o c u m e n t s a n d t h e r e a r e t w o n u m b e r s on t h e m . L oo k a t t h e num ber a t t h e b o t t o m r i g h t - h a n d s i d e . That i s r e l e v a n t num ber s o f a r a s y o u a r e c o n c e r n e d . T h is i s E x h ib it 1. get in to th e Mr. E n o c h . (SAME HANDED) k in d o f t r o u b le come t o o u r a t t e n t i o n . th e q u e stio n o f th e r e n ta ls th is: c o m p a n ies — a f a m i l y b y t h e name o f so m etim es Leave o u t f o r t h e m om ent; c o n c e r n e d w i t h t h a t a t t h e m o m e n t. con cern ed w ith i s w h e r e we I m en tio n ed e a r l i e r , When we l o o k a t o n e v e h i c l e oth er v e h ic le s lia b ility T h is i s I am n o t What I am T h e r e a r e tw o l i m i t e d e ith e r th at " lim ited " or th e y b e lo n g to w h ich I t h i n k is 1 v e r y u n l i k e l y — who r e p r e s e n t t h e m s e l v e s a s 2 d i r e c t o r s o f t h e co m p a n y . 3 about th o se 4 A. 5 2 9 Q. 6 A. 7 30 Q. 8 A. 10 11 co m p a n ies or where t h e y a r e s i t u a t e d ? C rom er a n d Caw sand? Y es, e x a c tly ? N e v e r h e a r d o f th e m i n my l i f e . N e v e r h e a r d o f th e m ? N e v e r h e a r d o f th e m e v e r . th at i t 9 Do y o u know a n y t h i n g is C o u ld I j u s t p o i n t Proud R e n t a ls n o t Pround. They seem t o h a v e p u t a n "n" i n . 31 Q. I know i t is Proud, I have seen i t 12 w ill 13 w i t h t h a t a t t h e m om ent, 14 w ith t h e q u e s t io n o f o w n ersh ip . 15 th at th ese 16 M a rtin a I n v e s tm e n ts ? 17 A. 18 32 Q. come b a c k t o t h a t l a t e r . e l s e w h e r e a n d we I am n o t c o n c e r n e d I am r e a l l y o n l y d e a l i n g You d i d n ' t tw o c o m p a n i e s w e r e d i r e c t o r s of I h a v e n e v e r u n t i l t h i s m o r n in g s e e n t h e n a m e s . Who d i d y o u u n d e r s t a n d w e r e d i r e c t o r s of A. I w ou ld h a v e presum ed i t w o u l d h a v e b e e n w h o e v e r w as 21 a p p o i n t e d a t t h e t i m e by-'my f a t h e r t o a c t 22 com pany. 23 33 Q. In o t h e r w ords, knew i t 24 25 A. Y es, w as t r u s t situ a tio n ? I knew t h a t i t w a sn 't in any one i n d i v i d u a l ' s name, 27 h a v e known w h a t f o r m o f i n s t i t u t i o n , 34 Q. fo r th e a r e y o u c o n v e y i n g t o me t h a t y o u 26 28 know M a rtin a I n v e s tm e n ts ? 19 20 out a n y p e r s o n s n am e. But I w ou ld n o t n e c e s s a r i l y if any. You h e l d t h e p o w e r o f a t t o r n e y i n r e s p e c t o f t h i s 1 Y es. 2 w as c o n v e n i e n t f o r me t o 3 r a t h e r t h a n k e e p s e n d i n g th e m t o a n d f r o t o 4 w herever. 5 35 Q The r e a s o n f o r t h a t i s , a s I am b a s e d h e r e sig n le a s e s I a p p r e c i a t e t h a t and t h a t i s it and t h i n g s very p r a c tic a l. 6 But i n o r d e r t o have a power o f a t t o r n e y you m ust 7 d isc u ss 8 A 9 36 Q 10 A 11 12 it w i t h so m e b o d y and g e t i t fr o m so m e b o d y ? Y es. W it h whom d i d y o u d i s c u s s it? I w o u l d h a v e b e e n a s k e d b y my f a t h e r I am s u r e t o a c t a n d I w o u l d do h i s b i d d i n g . 37 Q Your f a t h e r , i n p u r s u it o f w hatever d i r e c t o r 13 in te r e sts 14 'W ou ld y o u a c t a s p o w e r o f a t t o r n e y a s y o u a r e t h e 15 man i n 16 oth er t h in g s .' 17 A 18 38 Q h e m i g h t h a v e i n t h e com p a n y , I r e l a n d who w i l l sig n le a se s sa id to and v a r io u s And h e t h o u g h t h e c o u l d t r u s t me t o do s o . That a l l seem s v e r y l o g i c a l , Mr. E n o c h , but 19 u n fo r tu n a te ly th in g s 20 B ec a u se I t h i n k you w i l l a g r e e t h a t 21 tim e M a rtin a I n v e s t m e n t s have borrow ed fu n d s i n 22 Ir e la n d ? 23 A 24 39 Q 25 A 27 40 Q 28 A 29 41 Q There i s are n ever as sim p le as t h a t . from t im e t o n o t h i n g wrong w i t h t h a t . Y es. T h e y h a v e b o r r o w e d f u n d s fr o m a num ber o f d i f f e r e n t fin a n c ia l 26 you in stitu tio n s? Y es. S p e c i f i c a l l y G u i n n e s s & Mahon a n d I I B ? Y es. One o f t h e a p p l i c a t i o n s w h i c h w as made t o 8 Ir ish I n t e r c o n t i n e n t a l Bank — i n f a i r n e s s t o you I have 2 to 3 a p p lic a tio n s 4 Ir ish 5 sh o w Mr. E n o c h E x h i b i t 2 . 6 i n t e r n a l d ocu m en t. 7 I w i l l r e a d th e r e le v a n t p o r t io n s w ith you. 8 T h is i s 9 a lo a n . 10 say th a t i t is o n l y o n e o f a num ber o f a n d i n t e r n a l d o c u m e n t s we h a v e g o t f r o m I n t e r c o n t i n e n t a l B an k . P a r tic u la r ly (SAME HANDED) I want t o T h is i s an IIB docum ent a s k i n g f o r t h e a p p r o v a l f o r MR. SHIELDS: The c o p y y o u h a v e m i g h t 11 n o t b e t h e sam e c a s e . 12 is 13 m i s s i n g on t h e s i d e 14 JUDGE O'LEARY: not q u ie t c le a r . I n som e r e s p e c t s so i f som e o f i t I d o n 't th in k 16 th ere 17 T h is 18 You s e e up on t o p t h e r e a r e v a r i o u s 19 " /IIB ." 20 was g i v e n t o u s b y I r i s h 21 I 22 Bank f o r t h a t d o c u m e n t , 23 d ocum ent. 24 in fo r m a tio n . 25 T ru stees 26 w hoever i s 27 C h a n n e l I s l a n d com pany a n d t h e y own 100% o f i t . 28 D id you e v e r h e a r o f C r e d it S u i s s e T r u s t e e s 29 (G uern sey) a n y th in g o f any p a r t i c u l a r an I r i s h r e le v a n c e . I n t e r c o n t i n e n t a l Bank d o c u m e n t . You c a n t a k e i t , am s u r e i f is I h a v e t h e sam e p r o b l e m m y se lf. is It you b e a r w it h u s . 15 is an referen ces Mr. E n o c h , t h a t docum ent I n t e r c o n t i n e n t a l Bank. you go and a s k I r i s h In te r c o n tin e n ta l t h e y w i l l g i v e y o u t h e sam e They p r o v i d e v a r i o u s p i e c e s For ex a m p le t h e y s a y : (G uernsey) of " C red it S u i s s e L td" a r e t h e s h a r e h o l d e r s i n d o in g t h e b o r r o w in g . L td ? to They a r e a 1 A. 2 3 N o. I have heard o f C red it S u is s e , not th is 42 Q. th e bank, but p a r tic u la r one. A p p a r e n t l y t h e y own t h e s h a r e s . So m eb o d y b e l i e v e s 4 t h e y own t h e s h a r e s . 5 " S e e k a p p r o v a l t o p r o v i d e new c a s h b a c k e d t e r m 6 fa c ilitie s 7 u n f o r t u n a t e l y my p u n c h h a s g o n e t h r o u g h t h e a m o u n t . 8 It 9 b it is to : t o M a r t i n a I n v e s t m e n t s L td " a n d £64 6 ,0 0 0 or so m eth in g l i k e in te r e ste d 10 purpose. 11 am r e f e r r i n g 12 The p u r p o s e i s th a t. i n t h e sum s o f m o n e y , That i s a ll We a r e n o t a th at i s not our t h e M artin a I n v e s t m e n t s t o w h ich I a lo n g . It says: " M a r t in a i s a G u e r n s e y r e g i s t e r e d p r i v a t e l i m i t e d com pany w h i c h owns in v e s tm e n t p r o p e r t i e s a t O 'C o n n ell S t r e e t a n d 3 8 , P a t r i c k S t r e e t , C o r k ." 13 14 15 Can I t a k e i t 16 w h i c h y o u own i n r e s p e c t o f w h i c h y o u h a v e t h e p o w e r 17 o f atto rn ey ? 18 A. 19 43 Q. 20 21 24 25 26 27 28 29 M a rtin a I n v e s t m e n t s , t h e com pany i n respect of yes. T h e y own p r o p e r t y a t O ' C o n n e l l S t r e e t an d P a tr ic k S tr e e t? A. 22 23 th a t is Y es, I a c t u a l l y know o f t h e p r o p e r t i e s . I have h e a r d o f them . 44 Q. It c o n tin u e s: "The O ' C o n n e l l S t r e e t p r o p e r t y c o n s i s t s o f a ground f l o o r shop w ith f i r s t f l o o r o f f i c e s l e t t o a news a g e n t s and t o D u b lin C oun ty C o u n c il . M a r t i n a owns t h e p r o p e r t y u n d e r a l o n g l e a s e and s u b l e t s f o r a t o t a l r e n t o f c.IE P 3 2 k p e r annum. The C ork p r o p e r t y , p r e v i o u s l y o c c u p ie d b y A er L in g u s i s c u r r e n tly vacan t. M a rtin a i s b e n e f i c i a l l y o w n ed b y M i c h a e l a n d V i c t o r E noch, tw o d i r e c t o r s o f T r a v e lw is e , a D u b lin t r a v e l a g e n t ." 1 Judge, c a n I s a y t o y o u t h a t I am n o t t h e b e n e f i c i a l 2 ow ner, n ever have been, 3 e a r lie r 4 in te r e st 5 45 Q 6 A am n o t now a n d a s we s a i d o n may o r may n e v e r b e a p a r t y w i t h a n y in it. I u n d erstan d your p o s it io n . But t h e r e is one o th e r in a c c u r a c y h ere as w e l l . 7 V i c t o r Enoch h a s a b s o l u t e l y n o t h i n g w h a t s o e v e r t o 8 w ith th e t r a v e l a g e n c y . 9 fa c tu a lly 10 46 Q 11 12 A 13 47 Q f o r you d u rin g th e c o u r se o f h i s I have seen l e t t e r s th e t r a v e l b u s i n e s s .' 48 Q 'P le a se w r itte n to p eo p le in 15 17 l o o k a f t e r my s o n , L ik e t h e good f a t h e r . Ir e la n d M ic h a e l, who i s But t h e q u e s t i o n i s fa c e d w ith a d i f f i c u l t y : 19 I n t e r c o n t i n e n t a l Bank t h a t . 20 n o t s a y in g w hether i t 21 o b v i o u s l y I h a v e no v i e w on i t 22 g a th e r in g in fo rm a tio n ? A career? in I am s u r e h e d i d t h a t . 18 23 for He w o u l d a l w a y s do t h a t . sa y in g A That i s th ou gh he d id I t h in k c a n v a s s 14 16 in c o r r e c t. i n c o r r e c t and t h e r e c o r d s w i l l p r o v e t h a t . I u n d erstan d t h a t , b u sin e ss That i s do is Som ebody t o l d I am Ir ish I t may b e w r o n g — I am r i g h t o r w rong b e c a u s e — b u t I am j u s t I h a v e a v e r y s t r o n g v i e w b e c a u s e h e , my f a t h e r , 24 d e fin ite ly a t no tim e h a s e v e r had any i n t e r e s t 25 T r a v e lw ise , 26 That i s 27 m a k in g i s 28 b e n e fic ia lly 29 My u n d e r s t a n d i n g a n d my k n o w l e d g e a n d a l l in never. n ot th e p o in t th a t i t I am m a k i n g . The p o i n t I am s a y s t h a t b o th you and yo u r f a t h e r own t h e co m p a n y . 11 I have 1 e v e r b e e n aw are o f i s 2 atto rn ey to a c t on b e h a l f o f M a rtin a I n v e s t m e n t s i n 3 r e la tio n l e g a l d o c u m e n t s h e r e a n d s o o n a n d m aybe 4 b a n k in g o r w h a te v e r . As r e g a r d s h a v i n g a n y 5 b e n e fic ia l it 6 f a t h e r d i d t h a t h e n e v e r t o l d m e. 7 d o n ' t t h i n k he w o u ld h a v e done i t . 8 5 0 Q. to o w n ersh ip , t h a t 1 have a power o f is Of c o u r s e I u n d e r s t a n d a l l t h a t . c a r e f u l l y t o what you s a i d . 9 n e w s t o m e. I f my I p e r so n a lly I have l i s t e n e d B ut t h e p r o b l e m I am 10 fa c e d w ith i s 11 y o u a r e b o r r o w i n g m oney fr o m s o m e b o d y y o u p u t y o u r 12 best 13 A. 14 51 Q. foot — I th in k i t 16 A. 17 52 Q. fa ir to s a y t h a t w hen forw ard? Y es. You d o n ' t t e l l them a b o u t y o u r p r o b le m s , them a b o u t y o u r p o s i t i v e 15 is you t e l l th in g s? I have a lw a y s b e l i e v e d i n b e in g v e r y f u l l and fr a n k . W h o ev e r g a v e th e m t h e i n f o r m a t i o n , I can ta k e i t 18 w hether i t 19 g a v e th e m t h e i n f o r m a t i o n t h a t y o u w e r e o n e o f t h e 20 b e n e f i c i a l o w n ers o f M a rtin a I n v e s t m e n t s ? 21 A. be a c c u r a te or in a c c u r a te th a t I f th e y d id , th e y d id . som ebody But I h a v e t o r e p e a t a g a i n , 22 it 23 case. 24 th e c a se . 25 person. 26 o n e o f 10 o r 15 o r 20 p o s s i b l e b e n e f i c i a r i e s . 27 B u t I d o n ' t t h i n k I w o u ld e v e r b e named a s o n e . 28 I co u ld n 't 29 so m e th in g t h a t is n e w s t o m e. It is I d o n 't r e a l l y th in k i t is n e w s t o me an d I d o n ' t b e l i e v e th e th a t is My f a t h e r w o u l d n o t b e t h a t s o r t o f I t w o u l d b e f a r m ore l i k e l y s e e h im d o i n g t h a t . th a t I c o u ld be I f he h as done I d o n ' t know a n y t h i n g 1 2 53 Q Who w o u l d h a v e n e g o t i a t e d t h i s 3 4 How do y o u t h i n k t h e y g o t t h a t i n f o r m a t i o n . A I w o u ld h a v e th o u g h t i t lo a n ? w ou ld h a v e b e e n p r o f e s s i o n a l 5 p e o p l e who w e r e a p p o i n t e d t o l o o k a f t e r 6 so lic ito r s 7 54 Q 8 A Such a s? I d o n ' t know . If 10 it 11 w o u l d n ' t know . 12 55 Q it w as i n If is it m o re l i k e l y I r e l a n d we h a v e o n e o r we h a v e u s e d . th a t i t was a f i r m o f s o l i c i t o r s th e one t h in g of so lic ito r s 14 w o u ld h a v e g o t t h e m . 15 tak e i t 16 F irm s o f s o l i c i t o r s d o n ' t do t h i n g s 17 o ffic ia l T h e y may t a l k 18 but th ey w ill 19 t h e p e r s o n w it h t h e power o f a t t o r n e y , 20 power o f a t t o r n e y . 21 num ber o f d i f f e r e n t l o a n s ? A 23 56 Q a l w a y s do i s th at i t is ca p a c ity . a lso But I t h i n k came fr o m o u t s i d e a n d I 13 22 be i t or w h atever. tw o f ir m s o f s o l i c i t o r s 9 it, w r ite le tte r s. firm s And we We h a v e n ' t g o t th e m s o we c a n n ot a fir m o f s o l i c i t o r s . co n fir m i t e x c e p t i n an on t h e t e l e p h o n e in w r itin g . You a r e I h a v e n 't th e T h i s com pany h a s n e g o t i a t e d a T he co m p a n y may h a v e b u t I h a v e n o t . But t h a t is n ot th e q u e stio n I am a s k i n g y o u . 24 The q u e s t i o n 25 T h e y w o u l d h a v e b e e n a p p o i n t e d I p r e s u m e b y my 26 fa th e r or in t e r e s t s 27 n o t b e p r i v y t o t h a t i n f o r m a t i o n and w o u ld n o t e v e n 28 be con cern ed w ith th a t in fo r m a tio n b eca u se as I 29 w ou ld s e e it, I am a s k i n g i s , it who n e g o t i a t e d ? a c t i n g on h i s b e h a l f . I w ou ld h a s n o t h i n g t o do w i t h me a t a l l . 1 B ecause as 2 I am n o t a b e n e f i c i a l o w n e r t o t h e b e s t o f my 3 k n o w led g e and b e l i e f . 4 a n d I am q u i t e a w a r e o f t h a t . 5 not have one. 6 have I th in k i t 7 p e o p le . 8 57 Q I have to re p e a t t h i s a g a in — I am s a y i n g t h i s u n d e r o a t h I am p r e t t y s u r e I do I m ig h t h ave one one d a y . If 10 A 11 58 Q 12 A w i l l b e o n e w i t h 15 o r 2 0 o t h e r D o e s t h e name t h a t a p p e a r s a t t h e t o p o f t h a t m ean W h ich name? P a d r a ig C o lle r y ? Y es. I know fr o m r e a d i n g i n t h e p r e s s t h a t h e b e l o n g e d t o G u i n n e s s & Mahon. 13 14 59 Q 15 A 16 60 Q D i d y o u e v e r m e e t Mr. C o l l e r y ? Never e v e r . D id yo u e v e r m eet any o f t h e o f f i c i a l s i n G u in n ess & Mahon? 17 A 19 No b e c a u s e I h a d no o c c a s i o n t o . I h a d no r e a s o n to . 20 61 Q 21 A D id y o u e v e r m e e t Mr. D es T r a y n o r ? N e v e r knew o f h i s e x iste n c e . . I know a b o u t h im now , 22 a g a i n t h r o u g h w h a t h a s come o u t i n t h e p u b l i c 23 d o m a in . 24 I do a n y t h in g t o you? 9 18 I say — 62 Q I f you a c t u a l l y l o o k on t h e s e c o n d p a g e o f E x h i b i t 2 25 I m i g h t com e b a c k t o i t , 26 m o m e n t. 27 d i s p u t e on t h a t . 28 T h is, 29 M a rtin a I n v e s tm e n ts i s but I d o n 't need i t at th e I d o n 't t h in k t h e r e w i l l be any g r e a t Mr. E n o c h , I f you lo o k a t E x h ib it is 3. fu r th e r c o n fir m a tio n th a t c lo se ly c o n n e c te d w ith 1 C red it S u is s e T r u ste e s 2 can s e e t h a t i s 3 MR. SHIELDS: (G uernsey) w here t h e a d d r e ss i s ? T here i s 4 5 L td b e c a u s e you n o t h in g on t h i s , j udge. 63 Q. JUDGE O'LEARY: That i s 6 th e th ir d page o f E x h ib it 3. 7 Mr. S h i e l d s , it w o u ld b e b e t t e r i f 8 h is 9 m eans l o o k a t th em . own i n v e s t i g a t i o n s you l e f t on t h e d o c u m e n t s , h im do but by a l l We c a n g i v e y o u a n o t h e r c o p y o f 10 them i f 11 th e f i r s t 12 L td d o e s a p p e a r t o h a v e a r e s i d e n c e a t C r e d i t S u i s s e 13 T ru stees 14 A. 15 64 Q. 17 A. 18 65 Q. 19 21 22 (G uern sey) on L td ? That i s a le tte r fr o m G u i n n e s s & Mahon a n d i t is n o t su ch a lo n g tim e ago? N o. It is b o rr o w in g £ 3 1 0 ,0 0 0 . N o. Do y o u rem em ber le tte r ? Why w o u l d I h a v e r e c e i v e d i t because i t w a sn 't a d d r e s s e d t o me? 66 Q. 23 I f you lo o k a t th e t h i r d page o f i t , w ill 24 A. 25 67 Q. 26 A. Y es. T h is i s you it? why I s i g n e d t h i s p o w e r o f a t t o r n e y ? E x a ctly ? From w h a t I c a n r e c a l l t h a t w o u ld h a v e b e e n p a r t o f a se r ie s 28 t i m e when t h e s a l e w as g o i n g t h r o u g h . 68 Q. page 109, s e e p r e c i s e l y why y o u s h o u l d h a v e r e c e i v e d 27 29 Mr. E n o c h , says here. r e c e iv in g th a t A. Do y o u s e e t h e r e , p a g e o f E x h i b i t 3 t h a t M a rtin a I n v e s t m e n t s 1993 w h ich i s 16 20 So i t you w an t. o f docum ents I m ig h t h ave s i g n e d a t t h e What s a l e ? 1 2 69 Q. 3 A. 4 70 Q. 5 A. 6 71 Q. 7 8 A. P resu m a b ly a p u r c h a s e o f a p r o p e r t y a t t h e t im e . What p r o p e r t y ? It s a y s h e r e O 'C o n n e ll S t r e e t . I a p p r e c ia te th a t it s a y s O 'C o n n ell S t r e e t , 10 72 Q. 11 A. 12 73 Q. 13 A. 14 74 Q. h o p i n g y o u m i g h t d e p e n d o n y o u r memory a n d t e l l me? I w ou ld t h i n k t h a t i s is But you g o t t h i s fa c tu a l, I w o u ld s a y t h a t A. docum ent? Y es. And y o u s i g n e d i t ? Y es. Do y o u r em em b er t h e c i r c u m s t a n c e s i n w h i c h y o u g o t it. 15 Who d i d y o u g e t i t I b e lie v e from ? I w o u l d h a v e g o n e down f o r t h e c l o s i n g o f 17 th e s a le 18 th is 19 w ou ld h ave b e e n a sk e d t o 20 c a p a c i t y a s power o f a t t o r n e y . 21 75 Q. 22 A. to w herever i t I t w o u ld h a v e b e e n e i t h e r 24 in , 25 a g a i n t o my o f f i c e 26 when I s i g n e d t h i s . 7 6 Q. 28 A. s i g n a n d s i g n e d i n my , Where do y o u t h i n k y o u w o u ld h a v e d o n e t h a t ? I seem t o 27 t o o k p l a c e a t t h e t im e and w o u ld h a v e b e e n one o f t h e d o cu m en ts t h a t I 23 29 I w as co rrect. 9 16 What p u r c h a s e ? in a fir m o f a c c o u n t a n t s . r e c a l l o n c e h o p p i n g down i n a t a x i , sig n in g som e p a p e r s , g o in g g o in g o u t and g o in g b a ck and s i g n i n g . Do y o u rem e m b e r w h i c h o f f i c e That i s p r o b a b ly you s ig n e d i t in ? No b u t I rem em ber t h e r e w as o n e down o f f P e a r s e S t r e e t som ew here. I d o n ' t e v e n know t h e name 1 2 77 Q. S u r e ly i f it w a s t o do w i t h t h e s i g n i n g o f d o c u m e n t s 3 t o do w it h t h e p u r c h a se o f p r o p e r t y , 4 som e s o l i c i t o r ' s 5 A. 6 7 78 Q. o ffic e ? I t w o u l d h a v e b e e n o r an a c c o u n t a n t ' s o f f i c e . That i s r a t h e r s t r a n g e t h a t you w o u ld c l o s e o f a p rop erty in A. 10 11 Or m ay b e t h e s o l i c i t o r s a c tin g fo r th e vendors at 7 9 Q. MS. MACKEY: Who w o u l d h a v e a s k e d y o u to A. McCann F i t z g e r a l d s . 80 Q. JUDGE O’ LEARY: So s o m e b o d y o u t o f t h a t fir m w o u ld h a v e a s k e d you? A. 18 19 W ould h a v e a s k e d me t o come down t o do t h e n e c e s s a r y on a p a r t i c u l a r d a y . 81 Q. 20 21 Do y o u know w h e t h e r y o u w e n t t o t h e i r som eone e l s e ' s A. I w ent t o 23 p o ssib le to 82 Q. 25 or o ffic e ? som ebody e l s e ' s o ffic e . I b e lie v e That s h o u ld be e sta b lish . D id y o u e v e r d i s c u s s t h e m a t t e r w i t h Mr. L a n i g a n O 'K e e ffe ? 26 A. 27 83 Q. 28 A. 29 o ffic e I d o n ' t r e c a l l g o i n g t o McCann F i t z g e r a l d , 22 24 sig n ? I t h in k t h e p e o p le r e t a i n e d a t t h e tim e w ere 16 17 sa le th e tim e . 14 15 th e an a c c o u n t a n t ' s o f f i c e ? 12 13 was d o n e i n I t was on e o r t h e o t h e r . 8 9 it Who i s He i s Mr. L a n ig a n O 'K e e ffe ? t h e man w h o s e l e t t e r N e v e r m e t t h e m an. say, I th in k t h is you s ig n e d ? The s h o r t a n s w e r i s no. w ou ld h a v e b e e n a s e r i e s As I of 1 2 84 Q. As you w i l l a p p r e c i a t e i t is a v ery s e r io u s m atter 3 t o have a power o f a t t o r n e y f o r any p e r s o n o r any 4 com pa ny? 5 A. 6 7 I w a s r e a l l y a c t i n g a s my f a t h e r h a d t r u s t e d m e. I h a d p u t my t r u s t i n him a s i t 85 Q. w ere. I t h i n k t h e p o i n t I am m a k in g t o y o u i s t h a t I am 8 n ot sa y in g th ere i s 9 i s n ' t b u t b e f o r e y o u s i g n d o c u m e n t s w h i c h c o m m it a n y t h i n g w rong w i t h i t , th ere 10 M a rtin a I n v e s tm e n ts t o b o rro w in g a s u b s t a n t i a l 11 o f m oney, 12 fr o m s o m e b o d y ? 13 A. 14 8 6 Q. you w o u ld h a v e t o g e t c l e a r i n s t r u c t i o n s Y es. You w o u l d n ' t g e t y o u r i n s t r u c t i o n s 16 A. 17 87 Q. No. The s o l i c i t o r m i g h t s a y 18 d ocum en ts' 19 but th e y w o u ld n 't t e l l 20 to 21 A. 22 88 Q. 23 A. 24 8 9 Q. 25 A. 26 90 Q. 28 29 from t h e so lic ito r ? 15 27 sum 'Come down a n d s i g n t h e w h ich you h ave b e e n i n s t r u c t e d t o you t h a t you w ere i n s t r u c t e d s i g n t h e docum ents? That i s sig n . co rrect. Who w o u l d h a v e t o l d y o u t h a t ? My f a t h e r w o u l d h a v e a s k e d me . A g a in i t w ou ld b e b ack t o your fa th e r ? V e r y much s o . I w ou ld l i k e E x h ib it 4. to show y o u a s e r i e s A g a i n we g e t i t o f d ocu m en ts, fr o m I I B . 1 91 Q. T h a t m e a n s we g e t t h e l e t t e r fr o m I I B . 2 s o u r c e o f o u r docum ent i n o t h e r w o rd s. 3 le tte r 4 Company L t d . 5 A n s b a c h e r Cayman L t d . 6 and i t 7 It 8 o f t h e many nam es i t 9 life . is That i s It a f r o m Cayman I n t e r n a t i o n a l Bank a n d T r u s t That i s t h e com pany w h i c h i s now I t w as f o r m a l l y A n s b a c h e r L t d w a s f o r m a l l y G u i n n e s s Mahon Cayman T r u s t . t h e c o m p a n y we a r e i n v e s t i g a t i n g . That i s one had d u r in g t h e c o u r s e o f i t s You c a n s e e t h a t a p p a r e n t l y Cayman 10 I n t e r n a t i o n a l Bank a n d T r u s t Company i s 11 in str u c tio n s 12 r e s p e c t o f M a rtin a I n v e s t m e n t s . 13 It 14 is th e issu in g o r p e r m i s s i o n s t o G u i n n e s s & Mahon i n You c a n s e e t h a t . says: "We h e r e b y a u t h o r i s e a n d empower y o u p e n d in g paym ent o f any o v e r d r a f t s , l o a n s o r a d v a n c e s i n r e s p e c t o f w h ich M a r t i n a I n v e s t m e n t s L t d may b e lia b le ..." 15 16 17 18 They a r e g i v i n g a s e c u r i t y . 19 d o in g , 20 A. 21 92 Q. That i s what t h e y a r e g iv in g se c u r ity ? Y es. . My c o l l e a g u e p o i n t s o u t t h a t w h i l e t h e s e d o c u m e n t s 22 have an IIB c o n n e c t io n , 23 t h a t we g o t t h e m fr o m I r i s h 24 You c a n t a k e i t 25 b o r r o w in g s o f M a rtin a I n v e s t m e n t s . 26 I n t e r n a t i o n a l Bank a n d T r u s t Company a r e 27 g u a r a n t e e in g M a rtin a I n v e s t m e n t s . 28 th a t to 29 on i t it th a t th is one s id e ; w o u ld n 't be n e c e s s a r y is I n t e r c o n t i n e n t a l Bank. a le tte r g u a r a n te e in g And Cayman I want you t o p u t I am n o t a s k i n g y o u a n y q u e s t i o n s f o r t h e m om en t. I w o u ld l i k e you t o lo o k a t 1 E x h ib it 5 as w e ll. 2 o r a p r o p o se d b o rro w in g i n r e s p e c t o f 3 O 'C o n n e ll S t r e e t . 4 is 5 M a rtin a I n v e s t m e n t s . 6 C re d it S u is s e 7 page 120. 8 is 9 " g u a r a n t e e o f Cayman I n t e r n a t i o n a l Bank a n d T r u s t T h is i s It an I I B d o c u m e n t. is a r e v ie w o f an a c c o u n t d a t e d 2n d A u g u s t 1 9 9 4 . It is It d e a lin g w ith I t g iv e s th e address as T ru stees (G uernsey) L td. That i s on I f y o u g o t o p a g e 12 1 o f E x h i b i t 5 t h e r e th e p a rt I am i n t e r e s t e d in . You w i l l see 10 Company s u p p o r t e d b y a l i e n 11 p la c e d w ith I r i s h 12 Cayman I n t e r n a t i o n a l Bank a n d T r u s t C o m p a n y ." 13 What t h a t i s 14 M a rtin a I n v e s tm e n ts a r e b ack ed by fu n d s b y t h e 15 g u a r a n t e e o f t h e Cayman com pany a n d m o n e y p l a c e d on 16 d ep o sit? 17 A. 18 93 Q. o n an £ 3 1 0 , 0 0 0 d e p o s i t I n t e r c o n t i n e n t a l Bank b y su g g e stin g i s t h a t th e b o r r o w in g s o f Y es. I am p o i n t i n g t h a t o u t t o y o u . You c a n p u t i t to 19 one s i d e . I want t o show you a s w e l l a s t h a t 20 E x h ib it 6, p a g e 2 6 . 21 sim ila r k in d o f i n t e r n a l docum ent d e a l i n g w it h t h e 22 sam e c o m p a n y , M a r t i n a I n v e s t m e n t s . 23 page i t 24 " G u a r a n t e e o f A n s b a c h e r Cayman L t d 25 su p p orted by a l i e n 26 w ith I r i s h 27 p u t t h a t t o one s i d e . 28 7 29 (SAME HANDED) Were y o u a w a r e t h a t d u r i n g t h e You s e e a g a i n t h a t it is a On t h e s e c o n d d e a l s w it h g u a r a n t e e s and c o l l a t e r a l : (A nsb ach er) on a d e p o s i t p l a c e d b y A n s b a c h e r I n t e r c o n t i n e n t a l B a n k ." I want you t o Now I w i l l h a n d y o u E x h i b i t . 20 course 1 of 2 c o n n e c t i o n w i t h M a rtin a I n v e s tm e n t s c e a s e d and t h e y 3 s t a r t e d b a n k in g w ith I r i s h 4 Were y o u a w a r e o f t h a t c h a n g e ? 5 I b e lie v e 6 94 Q 1994 r u n n in g i n t o 1 9 9 5 t h a t t h e G u i n n e s s & Mahon I n t e r c o n t i n e n t a l Bank. I w o u ld h ave b e e n . B e c a u s e o b v i o u s l y you m ig h t h ave had t o sig n d ocum ents o r so m eth in g ? 7 8 A 9 95 Q 10 E x a c tly . P r o b a b ly i n t e r e s t paym ents o r s o m e th in g . We w i l l com e b a c k t o t h a t la te r . You s e e h e r e w h e r e G u i n n e s s & Mahon a r e s e n d i n g m o n e y t o 11 A 12 96 Q Y es. It says: 13 "Re: 14 We c o n f i r m t h a t we a r e i n r e c e i p t o f an i n s t r u c t i o n fr o m A n s b a c h e r (Cayman) L t d t o p a y t o I r i s h I n t e r c o n t i n e n t a l Bank £ 6 4 5 ,5 5 0 and £ 3 1 0 ,0 0 0 ." 15 IIB ? M a rtin a I n v e s tm e n ts L td. 16 17 A lm o st £ 1 , 0 0 0 , 0 0 0 ? 18 A 19 . 97 Q 20 Y es. O b v io u sly in som e way c o n n e c t e d w i t h M a r t i n a I n v e s t m e n t s L td? 21 A 22 98 Q Y es. Put t h a t t o one s i d e . Now I w i l l h a n d y o u 23 E x h ib it 8. T h is i s 24 we a r e i n v e s t i g a t i n g , 25 B ank a n d T r u s t Company L t d on b e h a l f o f 26 M a rtin a I n v e s t m e n t s . 27 gu aran tee? 28 I have to 29 p o in t. a g u a r a n te e e x e c u t e d by th e bank co n fess th a t w h ich i s Cayman I n t e r n a t i o n a l Were y o u a w a r e o f s u c h a fin a n c e i s n o t my s t r o n g I w o u ld n 't h a v e b e e n aware o f t h e 1 in tr ic a c ie s 2 still 3 99 Q. o r n e c e s s a r i l y how i t B u t y o u w o u l d h a v e b e e n a w a r e t h a t t h e r e w as a tra n sfer 5 I n t e r c o n t i n e n t a l Bank? A. 8 1 0 0 Q. 9 A. 10 11 o f b u sin e ss fr o m G u i n n e s s & Mahon t o T h a t I w o u l d h a v e b e e n m ore a w a r e o f . b a sic 7 a fa ct. But t h e d e t a i l s of it? The d e t a i l s w o u l d b e l o s t on me a l i t t l e b it I am a fr a id . 10 1 Q. You c a n t a k e i t , Mr. E n o c h , th a t I c o u ld spend th e rest 13 sim ila r 14 t h a t M a rtin a I n v e s tm e n ts were a c l i e n t 15 on t h e b a s i s 16 w ou ld you h a v e a n y t h in g t o A. 18 19 Ir ish That i s 12 17 a n d I am p ro b a b ly n ot to d a y . 4 6 op erates, o f t h e d a y g o in g th ro u g h t h e s e d ocum ents w ith in d ic a tio n s. If I w as l a t e r to c o n c lu d e o f A nsbacher o f t h e docum ents t h a t you h ave s e e n , say about th a t? The d o c u m e n t s a r e t h e d o c u m e n t s , th e y speak fo r th e m se lv e s. 1 0 2 Q. O b v io u sly j u s t lik e som ebody a c c u s e d y o u r f a t h e r o f 20 b e i n g a d i r e c t o r o f t h e t r a v e l com p an y a n d y o u q u i t e 21 c le a r ly 22 A. 23 1 0 3 Q. 24 A. 25 10 4 Q. s a i d he w a sn 't? V ery d e f i n i t e l y . And I b e l i e v e It is you. on r e c o r d . I b e lie v e you i n t h a t . 26 sure th a t i f 27 o b v io u sly f a l s e . 28 A. 29 1 0 5 Q. . S i m i l a r l y I w a n t t o make I make a n y s t a t e m e n t , That i t is th at i t not f a ls e is at a ll? I u n d erstan d . I am g i v i n g y o u a n o p p o r t u n i t y o f s a y i n g not 'Mr. O'Leary, that is not right at all. couldn't possibly be right.' That It would appear to me that there is strong evidence on the basis of what I have shown you that there was a customer relationship between Martina Investments and the bank we are investigating? I think that is a reasonable assumption. If you look at Exhibit 9. of Martina Investments. This is a balance sheet You can take it that in the previous pages there are other parts of the accounts. We will give them to you so that if as you say that you don't own Martina Investments, you might like to know what it is worth. balance sheet of Martina Investments. Exhibit 9 is a Have you ever seen that before? No, I would have no reason to see it. It is not my business. Even if it wasn't your business, assuming that to be right for the moment, maybe as the person with the power -of attorney from time to time you might have had to convey documents to somebody in Ireland which would include balance sheets? No, I have never so far as I know ever did that. role as power of attorney is more to effect the signing of a lease or if there was a conveyance — something like that — not anything to do with the financial side of it merely because as I said earlier I was conveniently on the ground here to deal with that. My 1 108 Q. If I was to ask you as to why this company had 2 £1,300,000 in 1993 available but they loaned it to 3 somebody else who is not identified in the balance 4 sheet and charged no interest for it? 5 A. 6 109 Q. 7 A. 8 110 Q. I am not the person to ask. Who might be the person to ask, your father? Possibly, yes. Not me anyway. You are very welcome to look at them. Mr. Enoch, if 9 anything when you consider these documents later you 10 have anything additional to add, feel perfectly free 11 through your solicitor to write to us. 12 that as part of your evidence . 13 A. 14 ' 111 Q. We will take Thank you very much. You should bear in mind that we will treat it as 15 sworn testimony when it comes in in that way. 16 you understand? 17 A. 18 112 Q. Do I understand that. Your solicitor should so confirm in writing that it 19 is to be treated as part of your sworn testimony. 20 You may well want to say 'I have looked at the 21 documents and there is something else I would like 22 to say.1 23 opportunity of doing that. 24 A. 25 I would like to stress that this area wouldn't be my normal province. 26 113 Q. 27 A. 28 114 Q. 29 We certainly wouldn't deny you the I understand that. Either to deal with or to understand. Now we will look at Exhibit 10. The only purpose of me showing you Exhibit 10 is not because it is also a Cayman Bank and Trust Company Ltd headed note paper, it is because it deals with the issue of Proud Rentals. Who are they, Proud Rentals? 4 Proud Rentals is effectively a collecting agent for 5 rents, as I understand it anyhow on behalf of 6 Martina Investments or whatever. 7 115 Q 8 A I would have initially been asked to deal with Proud Rentals by my father many years ago. 9 10 116 Q 11 A 12 13 Who issues them instructions? Do you deal with them on an ongoing basis? As I understand it, I don't think that is a company, I think that is just a name. 117 Q We can come down to who they are afterwards. I am 14 not interested in that for the moment. 15 really interested is in the fact that they are an 16 entity whether they are a company or not. 17 doesn't make any difference. 18 They are obviously collecting rents and/or managing 19 the property of Martina Investments? 20 A 21 118 Q 22 What I am It They are an entity. Correct. They are obviously getting their instructions from somebody? 23 A 24 119 Q 25 Well again, my father. Would you say they are getting instructions from your father or from you? 26 A 27 120 Q It could well be me on behalf of him. I just want to know who they get their instructions 28 from? 29 It is a bit like the power of attorney, I would deal 25 with day to day problems. If there was a day to day problem or matter or something like that. 121 Q 4 A 5 122 Q You would be the person they would come back to? Yes and no, I wouldn't be the final authority. I understand that. But as you will appreciate when 6 you are renting property, there is a hole in the 7 roof and you have to get a builder. 8 wrong or a tennant decides they are not going to pay 9 the rent, who do they get back to and say Something goes 'We have a problem.' 10 11 A 12 123 Q 13 A Proud Rentals? Yes? There is an office here who would deal that. If it 14 was something minor, like you said a roof that needs 15 repairing and an authorisation for that, I would do 16 that. 17 think it would probably go to my father. 18 124 Q If it was something of greater import, I Can I take it that the system or management is 19 something like — 20 matters, you deal with the slightly more important , 21 more than routine matters but not terribly important 22 matters and your father deals with the very 23 important matters. 24 A 25 125 Q 26 A 27 28 29 they deal with the routine Is that a fair summary? Roughly, yes, it is a fair summary. Who are Proud Rentals. I have no idea. Who is the Principal? Essentially I think it is a trading name more than anything. 126 Q Yes, but who is the boss then is the question I am asking you? 1 A. 2 127 Q. The question I am asking really is, who is the boss 3 of Proud Rentals. 4 at a lower level than your father, you must know who 5 the boss is? If you are dealing with them even 6 A. 7 128 Q. The boss of Proud Rentals? 8 A. The boss of Proud Rentals? 9 129 Q. It is my father and then I presume is the boss. M S . MACKEY: Who do you deal with when 10 you deal with them? 11 A. 12 130 Q. 14 A. 15 131 Q. 16 A. 17 132 Q. Are you and your father Proud Rentals? As I understand it, I am not quite sure. I cannot It could be. Is there any person here in Dublin who is employed by Proud Rentals? A. 21 There is an office, yes, and there are. two staff employed. 22 133 Q. 23 A. 24 25 Yes, I would talk to him. remember. 19 20 But you were asked by your father you said to deal with Proud Rentals? 13 18 I never deal with anyone at all. JUDGE O'LEARY: What are their names? But they look after other properties and other things as well. 134 Q. 26 27 A. 28 135 Q. 29 A. I understand. But the question I am asking is, who are they are. They must have names? They have. What are their names? Marie Sheridan and Jannette Hurrell. 136 Q 2 3 If I was to ask them who their employer was, what would they say? A It is a good question. There are a number of 4 property partnerships of which this is one all run 5 from the same building and from the same office. 6 137 Q The question is actually a simple question to which 7 I didn't get an understandable answer: 8 their employer. 9 is? 10 A 11 138 Q Who was Who do they believe their employer I suppose they would look on myself, my father. Is it fair to say that Proud Rentals are a structure 12 set up by Enoch property interests to look after 13 Enoch properties. 14 A the interests of my father, not other Enochs. 15 16 No, I think it would be fairer to say to look after 139 Q Is it fair then to say that Proud Rentals are a 17 unit, which is not incorporated apparently, a 18 trading name set up to look after the property 19 interests of Victor Enoch in Ireland? 20 A 21 140 Q 22 A 23 141 Q 24 Or of Martina Investments technically. Martina you think in Ireland? Yes. Would there, be other property interests other than Martina Investments that they would look after? 25 A 26 142 Q 27 The office? Would the office look after other property interests? 28 A 29 143 Q Yes. 1 A. They would be just different partnerships. 2 I might have my own property or a property with my 3 brother or a property with other partners. 4 would all be handled in the one office. 5 Proud Rentals is related to my father and 6 Martina Investments. 7 interests. 8 144 Q. They They only look after his But the service being provided by the same people who look after Proud Rentals would look after other 9 10 property interests of other members of the Enoch 11 family elsewhere in the country under different 12 names? 13 A. 14 ' 145 Q. 15 A. And other people as well? Other partners, yes. Different ventures would have different partners. 16 17 Yes, and other people as well. 146 Q. Do any of those ventures have a Cayman Island connection? 18 19 A. 20 147 Q. None whatsoever. I wonder would you look at Exhibit 1 again. 21 You already have that document. 22 that referred to Pround rather than Proud. 23 the one signed by the strange directors with the 24 surname "limited." 25 26 That was the one You see here it says: "We hereby authorise and request you to provide copy statements and advices on our account(s) held with yourselves to Proud Rentals. • 27 28 29 You are also authorised to discuss the account with any representative of Proud's Rentals. This authority does not extend to Proud's Rentals signing any It is 1 instructions relating to the account..." 2 3 That is fair enough. 4 Rentals received details from Irish Intercontinental 5 Bank from time to time of the accounts of 6 Martina Investments? 7 A. Can I take it that Proud I don't think they would have received the accounts, 8 but they would have maybe received interest debit 9 notes or something like that. 10 148 Q. But not the accounts. Isn't this what it says: "We hereby authorise and request you to provide copy statements and advices on our accounts held with yourselves to Proud Rentals." 11 12 13 Was that done? 14 15 A. I honestly don't know, I don't think so. 16 As far as I understand, all we ever got were debit 17 notes for interest payments. 18 149 Q. 19 I will come back to those later. Did you get copy accounts? 20 A. 21 150 Q. The short answer is no. Did you ever get an account with the words 22 "Ansbacher" "Cayman Islands" or "Hamilton Ross" on 23 it? 24 A. 25 151 Q. 26 A. I have never seen them. But did Proud Rentals ever get them? No, I don't believe so. In the case of Hamilton 27 Ross, I never heard of them until the whole case 28 surfaced. 29 1 "JD. Traynor Esq." 2 Mr. Traynor in 1993 was no longer working for 3 Guinness & Mahon but was operating independently in 4 the banking sector. 5 question we have to decide in due course. 6 But you can take it that he was no longer a director 7 of Guinness & Mahon, he was a Chairman of another 8 public company. 9 any business, it appears that he was carrying out You can take it that For and on behalf of who is a And insofar as he was carrying out 10 business from Fitzwilliam Square. 11 meet Mr. Traynor, that is probably additional 12 information for you. 13 Mr. JA. Collins? 14 ' A. 15 153 Q. 16 A. 17 154 Q. 19 A. 20 Yes, I have indeed. In what context have you heard of him? Just that he was involved in the management of some Of or on behalf of who do you think? I think the various Cayman institutions to which you referred. 155 Q. 22 23 Did you ever hear of of the properties or the banking end of it. 18 21 As you didn't But which properties do you think were being managed or assisted in Ireland by his services? A. I can only assume it was anything to do with the 24 properties in which Martina Investments had an 25 interest. 26 156 Q. 27 Had you come across him in the context of any other properties? 28 A. 29 157 Q. No. He had acted with the apparent authority of 1 Martina Investments from time to time? 2 A. 3 158 Q. I would have thought so. Here he is writing to Mr. Traynor and he says: 4 "Mr. Michael Enoch has power of attorney from Martina to close and has instructed solicitors to act for the company." 5 6 7/ What he says is that you instructed solicitors? 8 9 A. 10 159 Q. A. I don’t know whether it Again, I would have been asked to instruct solicitors to close a sale of the property. 13 14 ' 160 Q. 15 A. 16 161 Q- 17 A. 18 162 Q. 19 20 Yes, that is what he says. is right or wrong. 11 12 I instructed? Do you remember which solicitors that was? I believe it was McCann Fitzgerald. Who in McCann Fitzgerald would you have instructed? Colin Keane because he handled the conveyancing. Would you have chosen that or would your father have chosen that? A. I might have put forward his name because he did 21 other business for us anyway. 22 so it was ongoing. 23 24 25 163 Q. It wasn't a new name It continues: "Proud Rentals in Dublin will manage the property. Martina would like to borrow from Guinness & Mahon in Dublin." 26 27 And the various other terms are set out there. 28 Do you confirm that is the banking arrangements of 29 Proud Rentals: Bank of Ireland, College Green. 1 2 Q. Who signs Proud Rentals's cheques? 3 A. I would sign Proud Rental cheques. people who would sign. 4 5 165 Q. 6 A. 166 Q. A. 11 12 167 Q. A. 168 Q. 17 A. 18 169 Q. You know yourself when you sign the If any of the cheques were for relatively small You sign them yourself? Yes. I cannot remember whether there is a limit on But in respect of ordinary day-to-day activities it is your role? A. 22 I would think there is a limit but I cannot remember. 170 Q. 24 We can check with the bank. Lastly, Mr. Enoch, there is the question of interest that you said was added from time to time? 25 A. 26 171 Q. 27 A. 28 29 I would have to double-check them or not. 20 23 I believe they would. amounts there would be no problem. 16 21 Do they act on the instructions of one signature do cheques...(INTERJECTION)? 15 19 I don't know that it. 13 14 Nobody else here I don't think. you think? 9 10 Who else would sign them? there is anybody else. 7 8 I am one of the Yes. Would you explain to me how that worked? Debit notes would be issued be it from IIB or whoever. 172 Q. Or Guinness & Mahon? 1 A. IIB is one that springs to mind. They would be sent 2 to the office. 3 would sign it and that would be i t . 4 Q. Would that have happened every month or every quarter or every half year? 5 6 A cheque would be drawn up and I A. It varied. It could vary, but certainly quarterly 7 anyway. 8 or something like that. 9 174 Q. 10 A. 11 175 Q. 12 A. 13 176 Q. 14 A. I think now it is done by a direct debit But at the appropriate time? Initially at the time...(INTERJECTION). You were signing the cheques? Yes. What about interest on money which was on deposit? This is getting into a whole area of which I 15 wouldn't have a particularly strong understanding 16 firstly and secondly I would have no interest. 17 Whatever the figure was, the cheque was issued and 18 signed. 19 177 Q. 20 it or not there was interest? 21 A. 22 178 Q. 23 24 A. 29 Was the cheque-sent to you to be sent on to your No, it wouldn't go to him, it would be sent to the office. 179 Q. 27 28 I am not denying that, there was. father? 25 26 You can take it that whether you were interested in I am talking about interest which he earned on the deposits? A. That I know nothing about whatsoever. 1 2 My role, again as with the power of attorney, was 3 functionary. 4 deal with the mechanics of day-to-day operations. 5 The nuts and bolts but that was it. 6 was of no interest because it doesn't concern me. 7 As far as I know it doesn't concern me. 8 181 Q. A. 12 182 Q. 13 A. 14 It is always possible. These are things that my Does the name Ann Enoch Trust mean anything to you? Only in the sense that Ann Enoch was my late grandmother. 183 Q. 16 I would have heard the name. You know that there is a trust called the Ann Enoch Trust? 17 A. 18 184 Q. 19 20 Are you aware of any other trust of which you are or father would have organised as far as I know. 11 15 The wider scene might be a beneficiary? 9 10 The person who would on the ground to Yes, I have heard of it. Do you have an interest in that trust directly or indirectly? A. I have absolutely no idea whatsoever. I have no 21 particular reason to think that I would have. 22 I wouldn't know why it was set up or what it was set 23 up for. 24 185 Q. But I have heard the name. Lastly so far as I am concerned I have one other 25 question. 26 at this stage? 27 A. 28 29 What kind of health is your father in now Well he is 85 this year. He suffers from a number of maladies largely based on old age I am afraid. 186 Q. I got the impression from other information 1 available to me that while he is obviously suffering 2 from whatever is the appropriate consequences of 3 being 85 years of age, he is still sound in mind and 4 al that? 5 A. 187 Q. He has a That has to be attended to. Is he still controlling Martina Investments so far as you are concerned? 8 9 He suffers from a heart problem. pacemaker fitted. 6 7 Yes. A. He certainly has many of his faculties that goodness 10 retained but he is not as sharp as he used to be 11 naturally enough. 12 wee bit remote from things unfortunately. I understand that he is getting a 13 188 Q. I have no further questions. 14 189 Q. MS. MACKEY: I have one question in relation to that last 15 16 point, Mr. Enoch. 17 if your father was still controlling Martina 18 Investments. 19 is? 20 A. 21 190 Q. 22 Judge O'Leary asked you just now I am not quite clear what your answer My answer is that he is compos mentis, yes. Is he still giving instructions in relation to Martina Investments? 23 A. 24 191 Q. 25 A. I would presume so. Do you still have power of attorney? Actually by chance because of something that is 26 ongoing we discovered the other day that it lapsed 27 last year. 28 I said take instructions. 29 renewed. I was asked by the office what to do so I presume it will be 1 Q. 2 3 By the office, you mean the office where Proud Rentals are? A. Yes, they asked me. They came across it and 4 realised it had lapsed sometime last year. 5 But it would be necessary for me to have it again to 6 continue to sign future leases and documents. 7 193 Q. So when they asked you about that, you said take instructions to them? 8 9 A. 10 194 Q. 11 A. 12 195 Q. 13 A. 14 196 Q. Yes. Take instructions from whom? From my father. So in fact he is still giving instructions? Certainly, he is compos mentis but he is more frail. Obviously. When something needs to be done of 15 importance in relation to Martina Investments, it is 16 still your father who would do so? 17 A. 18 197 Q. 19 A. 20 Yes. There would be no doubt but that it would be him? Yes. . JUDGE 0'LEARY: 21 Thank you very much and thank you for coming. 22 You will appreciate our problems and difficulties? 23 A. 24 198 Q. Very much so. We appreciate you attending at what was going to be 25 a short interview. 26 on what we have said, if there is anything you wish 27 to add by all means do it in writing through your 28 solicitors. 29 If, Mr. Enoch, when you reflect 1 199 Q. In fact we had somebody in yesterday. He contacted us to say 'I forgot something.' 2 3 A. 4 200 Q. It invariably happens. We are flexible enough to take into account any 5 additional matters you might like to bring to our 6 attention. 7 A. 8 201 Q. I appreciate that. It is unlikely that we will be talking to you again. That is most unlikely. 9 We cannot rule it out 10 absolutely but it is most unlikely. 11 much for your presence here. 12 decision which is adverse to your interest we will 13 of course notify you and you will have the right to 14 come in and make what representations you like with 15 regard to that. 16 rather than for us, but it is unlikely that we will 17 be seeking your attendance again. 18 do so yourself; that is a different matter. 19 The only one other formality is this: 20 is no doubt later we request all the people who have 21 given evidence to look at the transcript and to sign 22 the transcript as being a true record of what went 23 on. 24 A. 25 202 Q. Thank you very If we make any That would be a matter for you You may chose to So that there I will be happy to do that. That will be done in due course and Ms. Cummins, our 26 solicitor who unfortunately is not here today, will 27 contact your solicitor and then make the necessary 28 arrangements. 29 203 Q. Of course you can get a copy of the transcript with 2 the payment of a small fee. 3 can be arranged between the solicitors if you so 4 require. That is a matter which We are finished now. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF INTERVIEW WITH MR. MICHAEL ENOCH [pl/#79 0/ M A R T I N A INVESTMENTS LIMITED P.O. Box 887, George Town, Grand Cayman, Cayman Islands British West Indies Facsimile (809) 949 7946 Telephone (809) 949 8655 27th January, 1997 Our Ref. 6465 . . The Manager IrishIntercontinental Bank Limited 91 Menion Square Dublin 2 ' Republic'ofIreland. Fax ^ Attn: Mr. Aldan Storey 011-3531-678-5034 . Dear Sir, W e hereby authorise and request you to ; heldwith yourselves to:- copy;statements and advices on our account(s) Prounds Rentals •* 3 Proud’s St Stephe»<^l8?eenWest Dublin ’ Telefax 478 1755 F A O M.T. Conway You are also authorised to discuss the account with any representative ofProud’s Rentals. This authority does not extend to Pround’sRentals signing any instructions inrelationto the ■ • account and ispurely to enable you to divulge information concerning the account(s) to Pround’s Rentals. . • Yours faithfully, foilManila Investments Limited cc » ' M.T. Conway Oil 3531 478 1551 Registered Office: 7-11 BritanniaPlace,Bath Stree,St.Hellier,Jersey KB Refc A c c . N u m t Date: 2 August, 1994 Next Review Date: 31 July, 1995 IIB MAURICE LEONARD !OWER(S): K.uVlE: DRAWER(S): NAME: PROFREL: COUNTRY: 1. Martina Investments Ltd. KEY FIGURES In mlo MARTINA INVESTMENTS LTD c/o Credit Suisse Trustees (Guernsey) Ud • PO Box 223, MIgriat Plateau; S t Peter Port, Guernsey, Channel Islands , Pdyate Limited C o m p a n y •"WE X ■ ■ C O U N TR Y ' LE ES. -S T A T U S .ftJSHED r* \ ,/rS lN C E 1 OUP 1R LENDERS BUSINESS UN E BORROWER CB CODE New ' / BEF BORROWER Date: TNW: TCW: Total Assets: Sales • Curr. Cash R : ' _ GUARANTOR Date: TNW: TCWfc . Total Assets: Sales: Curr. Cash FI: • Guinness Mahon Property investment 9.2 Exchange Rate: IEP1 .**BEF49.8775 LIMITS M BEF : MK3 Nn ‘ - - 2 T - Nature Request c DescriptionortheCredit u Unesand Limits • Maturity ' Date 310 New c 28 May 1998 648 New C IEP645.550 TI-FIoat Bilateral Bullet Demand Requested - islanding Granted/ Approved •. - 956 IEP310,000 TI-Float Bilateral Bullet Demand ' 30 June 1999 ■' GROUP RISK: 956 Note: (IBs exposure to CIBTC/Hamllton Ross related cash backed facilities'excluding the subject proposal is approx. GBP21m. • rs - Ul RWRIT1NG AND SUB Pa L . .CIPATIONS N/A RtSK PART1C1PAT1QM/SUB PARTICIPATION NO *IFIC REPAYMENT SCHEDULE N/A GUARANTEES & COLLATERAL Type Fac1 First fixed charge over 46-49 Upper O'Connell SL, Dublin.. Guarantee of Cayman International Bank & Trust Company Ud C*CIBTC“) supported by a Ben on an IEP310k deposit placed with IIB by CIBTC. \ced charge over 38 Patrick St., Cork. G intea of CIBTC supported by a lien on an IEP646k deposit placed with II;. . ,CIBTC. • * 1\ ‘ , iib: Fixed charges to cover margin exposure. . Value Status IEP350k (cost mid 1993) Proposed lEP310k Proposed lEP665k . (cost mid 1994) Proposed IEP646k ' Proposed ■TING SECURITY REVIEWED AND IN ORDER N/A COVENANTS N/A • ~ . TERMS AND CONDITIONS N/A INTEREST Period Int B a s s Mamin Cafc-Meth. Qss.if.ftS DIBOR 1% Amount outstanding/ 365 days. .1,3,8 months FEES N/A .al Currencies: i"'ing Scheme: ;. ibiifty Period: -ptlons: • .A/HT: None N/A . 30 September 1994 Yes Tax Credit N/A Jurisdiction; Irish N/A Ireland Tax Clause: Grossing up PROFITABILITY Usage of the Itne: New Capital Adequacy Ratio: 0% 0% . Minimum Margin: 35bp Effective Margin (Incl fees) 100bp Return on equity Return on committed amounts N/A N/A In’ it Status: Weighting on*used portion Weighting on unused portion :las ation: Low •rovteion-exist: r r None New Proposed:. None IONS HIP late Contact: July 1994 With: Padralg Collery. 'urpose Contact To request facility Role: Consultant to the Borrower jfvdllary Business: Deposits, other lending .LtiBAL PROFITABILITY: N/A >y r COMMITMENT N/A yPW'ON ON THE BORROWER N/A 4 • jU£ _ ■ •) 'JG N/A SHAREHOLDERS lame • “.redit Suisse Trustees (Guernsey) Ltd. eait3& Channel Islands 100% EXECUTIVE S U M M A R Y ,uroose: ' . o seek approval to provide new cash backed term facilitiesto Martina Investments Ltd. ("Martina”) ilfc arv of Borrower . • . na isa Guernsey -registered private limitedcompany which owns investment properties at ... O'Connell Street, Dublin and 38 Patrick Street in Cork. The O ’Connell Street property consists >fa ground floorshop with firstflooroffices letto a newsagents and to Dublin County Council. Jlartina owns tKe property under a long lease and sub letsfor a total rental of c. IEP32k p.a. THe Dork property, previously occupied by Aer Lingus iscurrentlyvacant Martina isbeneficially owned jyMichael and Victor Enoch, two directors ofTravetwise, a Dublin travel agent Summary of Transaction Buinness & Mahon previously provided sim ilar cash-backed facilities to finance the two properties, low ever it is expected that Guinness & Mahon will be purchased by Irish Permanent Building Society n the n e a r future and we have been requested by Padraig Collery, who acts as consultant to other :iients o f IIB to whom w e provide similar facilities totalling approximately GBP21m, to refinance them. Security ' .cilitywillbe secured by the guarantee ofCIBTC, supported by iiens over two cash deposits of 3>_.J310k and GBP646k placed by CIBTC with HB. W e willalso take firstfixed charges over the sroperties to be financed in Oubiin & Cork which were acquired for IEP350k and IEP665k in 1993 and 1994 respectively. • • Assessment • . '' ' Hne proposed facilitieswill be backed by IEP deposits equal to the fiacjiityamounts and we rely on jf^'^sh backingforour security ratherthan on recourse to the borrower or to CIBTC. W e have not 3bt -ad formal valuations ofthe properties tobe charged but are confident thatthey provide significantadditional securityforour facilities. The fatalitieswillform part of total cash backed :3 - ”es of approx. GBP22m which produce significantincome forIIB at low risk. . ' J ’ ..)alofthe application is'recommended. * • Muior Risk Factors; - . * . Documentation. Major Strong Points: • - Liens on deposits placed with IIBtotalling GBP956k. - Firstfixedcharges over the properties to be financed. . Documentation based on solicitor-approved precedents. - x k . Substantial business carried on with CIBTC/Hamilton Ross. . *• ,.iimendedby. Loan Officer Sgnjor^flK^aqfc? Deputy Head of Lending Credi Credit t Deoartment Department i Supported by DECISION OF UB CREDIT COMMITTEE Approved by: tJ U L X Director ) £ p p R C jV t ^ < < ................... .......... Mrecfor . ^ ' lIC O U J iC K R IIK K N m m lJ N J Tr.i.KriitMr.mum 26tif May 1993. MLOK/JR/MC The Directors, " Martina Investments Limited, . c/o Credit Suisse Trustees (Guernsey) ltd, ■ PO Box 223, * . Mignpt Plateau, ■ St. Peter Port Guernsey, . Channel Is la n d s . Dear Sics, ' . * Further to recent discussions we are pleased to confirm that we are prepared to provide to Martina Investments Limited a loan facility subject to the attached terms and conditions: Borrower: Martina Investments Limited. Am o u n t: IRE310/000 /Three Hundred and Ten-Thousand xrish jeovDnrels). . , Purpose: The facility is being provided to assist in the acquisition of 46-49 Upper O'Connell Street, Dublin 1. • Te rm / . Repayment: ' • Drawdown: ■ . In accordance with;normal banking practice, the loan facility is repayable on demand. . Subject thereto the facility is being provided for a period of five years and will be . repayable on or before 28th May 1998. The # loan facility will be reviewed off-air annual basis. ■ T h e - lo a n f a c i l i t y w i l l b e a v a i l a b l e f o r draw dow n on t h e c o m p le t io n o f a l l l e g a l fo r m a litie s . ’ Interest; Interest on the loan facility will be charged at 1% in excess of.the cost to Guinness & Mahon Limited of funding the loan. ' The interest rate will be set on drawdown and thereafter reviewed annually., Interest will be debited to the loan account on the 28th May annuallyand wiJL± .be iiranecU-a.Lely j^ayaLlu. " r* Security: As security for the loan we shall reguire a First Legal Mortgage over the property being acquired at 46-49 Upper O'Connell Street, Dublin 1. -Insurance: Additional Costs: Costs/Legal Fees: • We shall require that the property offered as security be fully-insured-^against fire and other wishes at all times. We shall require confirmation that the cover is in place and that -the Bank's interest has' been noted on the policy. . . In the event that the cost to us of providing ’thiB facility is increased by a change in any applicable law or regulation, or by any other cause we reserve the -right to increase the interest rate applicable hereunder as may be necessary to compensate us for such increased costs. - . ' * All costs and legal fees incurred in providing this facility Shall be for the account of the • Borrower. ' ■ - .... We enclose herewith a copy of this letter Which should be signed on behalf of the Company and returned to us as • evidence.of the Company'p acceptance of the facility on the terras and conditions set out. Me shall require a copy of the Board Resolution authorising the Borrowing and specifying these person(s) authorised to accept the facility on the terms set out herein. We shall also require the completion of the enclosed Bank Mandate and shall require ' /... certified copies of the Certificate of Incorporation and Memorandum and Articles o.f Association o f Martina Investments Ltd. ' . • We are pleased to be of assistance to ydu and trust that 'should you have any queries in relation to this letter, you will contact us. ’ " Tours faithfully, for GUINNESS & MAHON LIMITED', M. Lanigan-O'Keeffe, Managing Director. Enc. The .offer of facilities to Martina Investments Limited, on the terms and conditions set out above is hereby accepted. Mlcnaa\ B. Enoch 33 Power WQ of AUotney tut Martina lr.va3 tmonts Llmllea Cayman International Bank, and Trust. Companjr Limited P.O. Bax 887, GrandCayman,-CaymanIslands, BritishWest Tnrii~ • Telephone(809) 949-8655 Telex CP 43QS ' Facsimile'(809) 949-7946 3 1 s t M a y, 199q p * ™ «* G u in n e s s & Mahon L t d . 17 C o l l e g e G re e n ■ D u b lin 2 IRELAND D ear Si r s : . . . • . We h e r e b y a u t h o r is e and empower y d u p e n d in g pa ym en t o f a n y - o v e r d r a f t s , lo a n s o r advances I n re s p e c t' o f w h ic h MARTINA INVESTMENTS L IM IT E D may b e l i a b l e t o y o u , e i t h e r s o l e l y o r j o i n t l y w i t h o t h e r s , as p r i n c i p a l o r s u r e t y , o r i n a n y o t h e r m anner w h a ts o e v e r , and n o t w it h s t a n d in g t h a t a n y s u c h l i a b i l i t y may be c u r r e n t , t o h o l d a l l m onies w h ia h now o r h e r e a f t e r may s ta n d t o o u r c r e d it: w ith G u in n e s s & Mahon . L i m i t e d in Account N o . 13 1 5 4 9 7 9 t o g e t h e r w i t h i n t e r e s t t h e r e o n ‘as s e c u r i t y f o r a l l such l i a b i l i t i e s . F u r t h e r m o r e , yo u a r e a u t h o r is e d t o s e t - o f f and a p p l y s u c h m o n ie s o r a n y p a r t t h e r e o f fro m tim e t o t im e i n o r to w a rd s s a t is f a c t io n of s u ch - l i a b i l i t i e s e n t ir e ly a t y o u r own d i s c r e t i o n 'w i t h o u t f u r t h e r n o t i c e t o u s . We a ls o a g re e t h a t s u c h s e t - o f f w i l l be* a good and v a l i d d is c h a r g e o f s u c h m o n ie s so a p p lie d w it h o u t t h e n e c e s s it y o f a n y f u r t h e r e n d o rs e m e n t o r a u t h o r i s a t i o n fro m u s w h a ts o e v e r a n d t h a t w i t h o u t r e q u i r i n g a n y f u r t h e r c o n s e n t fro m u s y o u may v a r y , .e x c h a n g e , a b s t a in fro m p e r f e c t i n g , o r r e le a s e a n y o t h e r s e c u r i t i e s h e ld now o r t o b e h e ld h e r e a f t e r . b y y o u on a c c o u n t o f t h e m onies in te n d e d t o be h e re b y s e c u r e d . . Limited) b ;? Group Entity: IEB ' Compilation date: Exchange Rates: 23 October 1996 1J0EP5349.40BEF jjJENTrFTrATION OF COTTNTBRPARTY Name City & State Borrower Martina Investments Limited C/o Credit Suisse Trustees (Guernsey) Limited, PO Box 223, Mignot Plateau Street,PeterPort, Guernsey ' Channel Islands • Private limited company . N/A 1994. . Martina InvestmentsLimited Property Investment • slypountry ■. egal Status Established Client Since youp .■ • usinessLine I ’ ' . Key figures in (BEFm) N/A • Aunroved 1 af: 1 • 1 Lines in lEPinThd Outstanding Granted/ Total ‘ • N/A Ratings Long Term Short Term 3 . .Guarantor ■* . ■ ; Tangible Capital Worth Current Cash Flow Remarks 2 ' 310 646 956 Aidan Storey 310 646 956 . • . Requested 333 New C Bilateral lEP333k Tenn Loan Bullet 310 Review c Bilateral IEP310k Term Loan Bullet 646 1,289 . Natureor C Description of lines and limits reouest' ■ u Review Group Risk c Bilateral _ IEP646k Term Loan Bullet . 1,289 * Maturity date • 31 Oct 2001 ' 28 May 1998 ’ 30 June 1999 SPECIFIC R E P A Y M E N T S C H E D U L E Date ' IDS Share Total Facility . Remaining Repayments Remaining Repayments amonnt amount Comment k in ? ! 31 Oct 2001 i . v’--'^ne 2 '28 May 1998 IEP333.000 Nil IEP333.000 NO Lines 1-3 are demand facilities. IEP310,000 NH IEP310,000 NO »jne3 •• - June 1999 IEP645.550 . Nil DSP645.550 Nil • * • G U A R A N T E E S ANT) mi.T.ATERAL: Tvoe: Amount: Line 1 1. Guarantee ofAnsbacher Cayman All sums Ltd. (“Ansbacher”) supported by ■ a lienon a deposit placed by Ansbacher with IIB. . . . ' irstfixed charge over 1-2 Allsums' Moore St Dublin 1. " &Z • ‘ ->VENANTS 1 N/A gtflfas: LTV; XEP333k Proposed 100% D2P350k ’ Proposed (Oct. 1996 cost) 95% IEP310k 100% • Guarantee ofAnsbacher AH sums supported by a lienon a deposit placed by Ansbacher with IIB. - . 2. First fixed charge over 46-49 All sums Upper O ’Connell St, Dublin 1. Line 3 1. Guarantee ofAnsbacher supported by a lien on a deposit placed by Ansbacher-with DB. 2. First fixed charge over 38 Patrick St., Cork. Value; . Perfected IEP350k (1993 Cost) Perfected 88% All sums IEP646k Perfected 100% All sums IEP665k (1994 Cost) Perfected . Isting 1 Classification: Interest status: Interest booking: Provision: Low Performing Accrual Ml T E R M S A N D CONDITIONS ^ I N T E R E S • Classification: .Low Interest status: ' Performing Accrual . Interest booking: NH Provision: N/A T it.Base Margin fin bnl Comments 100 On allfacilities : ’’y TJIBOR+RAC -ote: Deposit isrolled atDIB ED for the same period. TEES . ' N/A Availabilityperiod: Put options: Special tax status: Law: ' Jurisdiction: Facility 1:31 December 1996. Facility2 & 3 are fiillydrawn. Yes -Demand facilities No Irish Ireland . PROFITABILITY .> taladequacy Ratio: 35bp •*' imumMargin; •infectiveMargin: 0»cl. fees) weighting on used portion weighting on unused portion 0% 0% - 0 % usage: Nil 100% .usage: lOObp • Return on Equity As facilitiesare cash-backed thereisno equity requirement (Expected) usage o f the line: ' 100% . . M A R K E T IN G S T R A T E G Y H B provides approximately GBP3.75m ofcash-backed loan and guarantee facilitiesto Ansbacher-related borrowers. Two similar cash-backed facilitieswere refinanced on a commercial basis inJuly 1996 at a level of ' 15m. ' . PURPOSE O F T H E A P P L IC A T IO N 2J GeneralInformation Martina is a Guernsey-registered private limited company, beneficiallyowned by Michael and Victor Enoch, two directors ofTravdwise, a Dublin travel agent. Tfre company owns a number ofinvestment properties including 46/49 O ’Connell StreetDublin, 38 Patrick Street Cork, and 1­ 2 Moore Street 1-2 Moore Street was acquired in October 1996 for IEP350k. It produces rental income ofIEP34k p.a. . 3: EVALUATION OF TOE GPARANTOR ' ' Ansbacher Cayman Ltd, (“Ansbacher”),isa subsidiary ofAnsbacherHoldings pic. which isowned by the FirstNational Bank ofSouthern Africa (CAER. rating“B B ”).W e relyon the cash deposits charged to us ratherthan on recourse to the guarantoritselfinevaluating our security. , * , ; ’ PROPOSED TRANSACTION 4.2 Terms and Conditions ' . -t The new facilitywillbe secured by theallsums guarantee ofAnsbacher, supported by a lienover a deposit equal to the amount ofthe facility(asisthe caseforfacilities2 & 3).Both the loan and the security deposits willbe rolledforthesame term in orderto match interestrates. W e will also take a firstfixed charge over 1-2 M o o n Street. ’ All fenilitiiMiarefullycash-backed. Our margin exposure iseffectivelycovered by the value ofthe firstfixed charges we hold. 5:' A S S E S S M E N T A N D ADVICE . .„ W e rely on the cash-backed nature ofthefacilitiesforour security ratherthan oh recourse to the . ! borrower or to Ansbacher, our guarantor. W e have not obtained formal valuations on any ofthe propertiesbut are confident thatthey provide significantadditionalsecurity. The facilities-formpart of total cash-backed facilitiesofapproximately GBP3.75m introduced by Ansbacher which produce an acceptable returnat low risk.Approval isrecommended. REVIEW DATE MONITORED EXPOSTi 31 October 1997 COMMENTS: UltimateDate ofDecision: 1 October 1997 Recommended by. Assistant Manager DECISION OF IIB CREDIT COMMITTEE proved by: . •ippN o: ^ ^ DIRECTOR f X r ' . TM P A R M A T IO N on: . Senior Manager a p p r o v e d B: MAURICE LEONARD JT b Acc.Numf”.: (18 left Date: ' Next Review Date: 2 August, 1994 31 July, 1995 DRAWEES): DWER(S): PROFREL: .d: NAME: COUNTRY: .Martina Investments Ltd. KEY FIGURES in mto „ jm z MARTINA INVESTMENTS LTD c/o Credit Suisse Trustees (Guernsey) •Ud • PO Box 223, Mlgnot Plateau, S t Peter Port, Guernsey, Channel Islands . Private Limited Company * 3TA'» .1 ‘ COUNTRY -R -STATUS =S‘t Jlished k '} SINCE .O U P ' New ‘ . BUSINESS LINE BORROWER CB CODE ‘ BORROWER Date: TNW: TCW: Total Assets: ’ Sales Curr. Cash FI: • GUARANTOR Date: TNW: TCW:. ., . Total Assets Sales: ■ ‘ Purr. Cash FI: • * LENDERS BEF Gufnness Mahon Property Investment 9.2 Exchange Rate: . IEP1= BEF49.8775 MMITSINBEF:MIO -•*1 ’ ..■(standing Grantedf Approved Requested - « Nature Request 310 New • 2 T 846 New - ’ - 956 c OescriptfonofthaGiscBt 0 Une»«ndUn8a ,C IEP310,000 TVFloat Bilateral Bullet . Demand C IEP64S.550 Tl-Float Bilateral Bullet Demand Maturity Hate ' . 28 May 1898 ’ 30 June 1999 GROUP RISK: 956 Note: IIBs exposure to ClBTC/HamiHon Ross related cash backed faculties excluding the subject proposal Is approx. G8P21m. . . iEJC WRITING AND SUB Pa L .CIPATKINS N/A »1SK PARTICIPATION/SUB PARTICIPATION NO If ^tC REPAYMENT SCHEDULE N/A GUARANTEES & COLLATERAL • Stgtus !lE § :ac 1 . ■Irst fixed charge over 46-49 Upper O'Connell SL, Dublin. - !EP350k (cost mid 1983) Proposed. IEP310k Proposed IEP665k . (cost mid 1994) Proposed IEP646k Proposed 1 guarantee of Cayman International Bank & Trust Company Lid (“CIBTC") upported by. a Hen on an 15*31Ok deposit placed with IIB by CIBTC. Irst '3 •'d charge over 38 Patrick St., Cork. - . •ee of CIBTC supported by a Hen on an IEP846k deposit placed with Sur IB k. ■jSTC. ite’. ' Fixed charges to cover margin exposure. * t NO SECURITY REVIEWED AND IN ORDER N/A COVENANTS N/A . PERMS AND CONDITIONS N/A NTHREST ApplicationField nt Base Mamin CalcJWeth. Period ■acs1 & 2 3IBOR 1% Amount outstanding/ 365 days. 1,3,6 months i H F N/A None N/A 30 September 1994' Yes .Tax Credit: N/A Jurisdiction: Irish tit. Currencies: Scheme: Vw llty Period: . 'u tv ons: Jv- ‘.T: Tax Clause: Grossing up N/A Ireland PROFITABILITY Jsage of the line: New Dapftal Adequacy Ratio: 0% 0% Minimum Margin: 35bp Effective Margin (incl fees) 100fap Return on equfty Return on committed amounts N/A N/A ints Interest Booking: Status: N/A Weighting on used portion Weighting on unused portion Accrual r * RVV..V. • • • issi ton: * ' jvision-exist: 1 r r Low None None New Proposed: UNSHIP . te Contact: July 1994 With: rpose Contact: To request faculty Role: ■ Consultant to the Borrower' dllary Business: Deposits, other lending .OBAL PROFITABILITY: N/A Padralg Collery . ‘ ,X7.:T COMMITMENT N/A »IW f»N ON THE BORROWER N/A l a f •; 1 N/A a s. .AREHOLDERS Nattenafflbt Channel Islands edit Suisse Trustees (Guernsey) Ltd. seek approval to provide new cash backed term facilitiesto Martina Investments Ltd. ("Martina"). iEr > . . ‘ • sjB rv of Borrower .’ ’ •' • , -tIs a Guernsey - registered private limitedcompany which owns Investmentproperties at «• . J’Connell Street, Dublin and 38 PatrickStreetin Cork. The O'Connell Street property consists a ground floorshop withfirstflooroffices letto a newsagents and to Dublin County Council, artina owns the'property under a long lease and sub letsfora totalrental ofcl IEP32k p.a The arkproperty, previously occupied by Aer Lingus iscurrently vacant •Martina isbeneficiallyowned fMichael and Victor Enoch, two directors ofTravelwlse, a Dublin travel agent ‘ ■tmmarv of Transaction uinness & Mahon previously provided similar cash-backed facilities to finance the two properties, w ever it is expected that Guinness & Mahon will be purchased by Irish Permanent Building Society the near future and we have been requested by Padraig Collery, who acts as consultant to other ents o f IIB to whom we provide similar facilities totalling approximately GBP.21m, to refinance them. rcu>..v j iUtywill be secured by the guarantee of CIBTC,- supported by liens over two cash deposits of L -, Ok and GBP646k placed by CIBTC with IIB. W e will also take firstfixed charges over the operties to be financed in Dublin & Cork which were acquired for lEP350k and IEP665k in 1993 id 1994 respectively. . ssessment ' •proposed facilitieswill be backed by lEP deposits equal to the facilityamounts and we rely on ash backing for our security rather than on recourse to the borrower or to CIBTC. W e have not )ter' "yiformal valuations ofthe properties to be charged but are confident that they provide gniftv^nt additional securityfor our facilities. The facilitieswillform part of total cash backed cilities of approx. GBP22m which produce significant income for IIB at low risk. . Dpr .(Iof the application isrecommended. • . ’‘ «• i, . -gtsk Factors: * . Documentation. •• . aior Strong Points: • Liens on deposits placed with IIB totalling GBP956k. . . ’ Firstfixed charges over the properties to be financed. documentation based on solicitor-approved precedents. ‘ • . Substantial business carried on with CIBTC/Hamilton Ross. rlf/me U o f o m tended by: Loan Officer ipported by . pgmoiwwanpBHg* . C Deputy Head of Lending Credi t Department a ppr _ SCISION O F IIB CREDIT COMMITTEE jX J L L tproved by: 1 Director ■ .pNo:^^ . ' ;nt t<~ Kredietbank for ![ru P /p- /g l> * I Q" rE t ) . t * . . /.N GUINNESS & MAHn\y PRIVATE BANKERS 6 M u c k 1995. KfrPaalNessins IrishIntercontinentalBask Merdon Square Dublin 2 Uulrvi«» ftMahon " *•'IrahnKSLM ' •CcieooGreen” UCMil T M A f t t i n r v .' ' 010790844 FacaknBa 01 8720942 Tetaa 83687 D u b lin D o c u r r a n i Exchangeaa ".. UWOMttHilm Dear MrNessnis ' •* ’ Martina Investments 1 hntfrwf *' ’ Weunderstand that you have agreed to refinance the borrowings held bythe above company wrth Guinness & Mahon @relnnd) Limited subject intar alia, to the receipt by you of confirmation that we haverecdved from. Ansbacher (Cayman) Limited an instruction to transfer to their account at Irish Intercontinental Bank Limited, nznouzds of nUs$45,550 and IRJE310,000 respectively. W e also.understand thatitishoped to complete the refinancing on 6 March. 1995. - . B «U J»U r»a No. 183M IrtfUM ■ ) ' ^•nmwnlOtoup m awM M W e confirm that w c are in receipt of ah instruction fiom Ansbacher (Cayman) Ltd. to pay to M & IntercontinentalBank: J) nUj545,550 for credit to account Ansbacher (Cayman) Limited, account number.01/46117/77; and ii) IR£310,000 for credit to account Ansbadier (Cayman) Limited, accountnumber 01/46240/77. . W e confirm farther that subject to Guinness & Mahon (Ireland) Limited receiving on 6 March 1995 for value 6 March 1995 from Irish.Intercontinental Bank that the amounts of 111645,550 and IR£310,000 respectively and 1R£3 9,096,13 from Martina Investments Ltd, being the monies required to redeem in foil the loans provided to Martina Investments Ltd (as outlined overleaf), we will pay the requested amounts toyou, for same day value, i.e. 6 March 1995. The redemption amounts are as at close of business on 5 March 1995. . 1 3< i) Tvun Interest Kcnsedi E£310.000.00 toSMtr. ‘95 (lacL) B U O J S Z ll W 3Z t£)9M DailyBate IR£ S2.ll in Lou ' JftC642.040.00 JbttrestAccrued lo5M«r.‘95 ' !R£M7.10«.32 DaQvRtfo DR. 109.94 W e further undertake (hat on receipt of the redemption, amounts, w e will release the Mortgages heldty the Dank on the properties at: • • . a) 46/19 0 ‘Connoll Street, Dublin . ' .b) • 38,Patrick Street, Cork ' and will execute such documentation' as is necessary to accomplish this. - Yours sincerely for GUINNESS & M A H O N (RELAND) L I M B E D To: Irish Intercontinental Bank limited 91 Mention Square, . Dublin 2. ' Date:^\204 - lo - 1994 < W e Cayman International Bank and Trust Company limited ofP.O. Box 887, Grand Cayman, British West Indies (hereinaftercalled the Guarantor”) in consideration of your from time to lime making advances to or coming under liabilities or discounting bills for or otherwise giving credit or granting banking facilities to or granting time to or on account of Martina Investments Limited (hereinafterreferred to as die "Principal”) do hereby guarantee to and agree with you as follows: 1. The Guarantor will pay you on demand^and hereby guarantees the payment to you _■* on demand of all sums of money which n o w are or snail hereafter become due to . ■ you from the Principal either alone or in conjunction:with any other corporation or . corporations person or persons and whether as Principal or Suretyand^vhether . upon account current or other banking account or accounts or otherwise or in respect of bills drafts notes or other negotiable instruments made drawn accepted advised endorsed or paid by you or on your account for die Principal either alone or in conjunction as aforesaid or which you may from time to time become liable tojpay in respect of any bills drafts notes letters of credit circular notes or any other dealing or transaction on account of or for die benefit or accommodation of the Principaleither alone or in conjunction as aforesaid togetherwith allinterest costs commissions and otherbanking charges and expenses which you may in the course ofyour business as bankers charge against die Principal and all costs charges and expenses which you may incur m enforcing or obtaining payment of . the sums ofmoney due to you from the Principal either alone or iniconjunction as .. aforesaid or attempting so to do. '- 2. . 3. 4. This guarantee shall continue in force and be a continuing guarantee to the extent at any one time of allmonies due to.you by the Principal (whether current or otherwise or subject to notice or not and in whatever currency) in addition to such further sum for interestand other banking charges and costs and expenses as shall accrue due to you within sixmonths before or at any time afterthe date upon which payment shall be demanded by you from the Guarantor or any one or more of the persons constituting; die Guarantor and shallbe applicable to the whole u ltim ate balance thatmay become due to you from the Principal either alone or in •conjunction as aforesaid and not merely to a portion, co-extensive with the amount of m e said limit . Itshall be lawful foryou at any time after notice to determine this guarantee has been given or afterpayment of the moneys guaranteed has been demanded of the Guarantor to continue any existing or to open any new account or accounts with the Principal and no money thereafter paid into such account or accounts shall be appropriated in discharge of any moneys hereby guaranteed unless expressly (Erected by the person paying tne same at die time of such payment to be so appropriated. . Where the Guarantor is a firm or otherwise consists of more than one person the liability of the Guarantor hereunder shall be deemed to be thejoint ana several liability of the parties in the firm or of such persons as aforesaid. • The bankruptcy or insolvency of the Principal shall not affect or determine the liability of & e Guarantor imnw this guarantee but such liability shall continue in full force and effect until you have been repaid allmoneys due to you' from the Principal immediately before the bankruptcy or insolvency of the Principal All dividends compositions and moneys received by you from the Principal or from any other company person or estate capable of Being applied by you in . reduction of the indebtedness of die Principal shall Be regarded for allpurposes as payments in gross and you shall be entitled to prove in the bankruptcy of m e Principal should he become bankrupt in respect of die whole of his indebtedness to you and without any right on die part of die Guarantor to be subrogated to you in respectof any such proof until you shall have received in the bankruptcy of the Principal or from-other sources lOOp in the £. No assurance security or payment which ma y be avoided under any enactment relating to bankruptcy or under Sections 286 and 288 of die Companies Act 1963 or any statutory modification thereofand no release settlement or discharge which may nave been given or made on die faith of any such assurance securityor payment shallprejudice or affect your right to recover from die Guarantor to the full extent of mis guarantee. . This guarantee and your rights under itwill not be affected or prejudiced by your holding or taking any other or further securities or by your varying releasing or omitting.or neglecting to enforce any such securities or by your varying or determining any creditto the Principal or by your renewing bills of exchange promissory notes or other negotiable instruments or giving time for payment or granting any other indulgence to or making any other arrangements with or accepting.any composition from the Principal or any person or persons corporation or corporations liable on any bills of exchange promissory notes or other negotiable instruments or securities held or to be held by .you. • You shall be at liberty but not bound to resortfor your own benefit to any other means of payment at any time and in any order you think fitwithout thereby diminishing the liability of die Guarantor and you may put this'guarantee in force • either for the payment of die ultimate balance afterresorting to other means of payment or for the balance due at any time notwithstanding that othermeans of payment have not been resorted to and in die latter case without entitling the Guarantor to any benefit from such.othermeans.ofpayment so long as any moneys remain due from die Principal to you. ... • You ma y at any time (both before and after any demand hereunder and without prior notice) set off any liability of the Principal to you (whether or not then due and payable) against any credit balance in account no. 01/46540/77 of die _ Guarantor with you (whether current or otherwise or subject to notice or not and in ' whatever currency) and m a y retain the whole or any part of such credit balance to meet the liability of the Guarantor to you. In the event of the Principal becoming bankrupt or making any arrangement or composition with creditors the Guarantor will not prove in competition with you in any such bankruptcy in respect of the debt due from the Principal to you but will give you the benefit of any proof which the Guarantor may be entitled to make in respect of any part of such aebt paid by die Guarantor until you shall have received the full amount of the debt due to you from the Principal. • jt 12. 0 r \ V. . . » Any settled or statedby or between you and the Principal or on his behalf may be ad'fr™’**by you and shall be accepted by die Guarantor as conclusive iftgrtt»nra>ux account or otnerwise py or on oenaii 01 me rrincipai ox sucn lity operate as an acknowledgement of die liabilityofthe Guarantor according to the terms thereof Nothing done or omitted by you in pursuance of any authority or permission contained in ibis guarantee snail affect or discharge die liability of die Guarantor under it ’ • • • >. This guarantee shall remain in fiillforce and yon shall be entitledto recover against die Guarantor to the full extent herein mentioned notwithstanding thatthe debt ofthe Principal may have been ultravires die Principal or thatthe borrowing powers ofthe Principal may have been exceeded or thatBy reason of any incapacity or any defect or informality the amount advanced to or the liabilityof die Principal cannot be recovered froni or enforced againstthe Principal 15. The benefit of this guarantee and allrights conferred upon you hereby may be assigned to and enforced by any assignee and proceeded on in the same manner to allintents and purposes as ifsuch assignee had been named herein instead ofyou. 16. Any notice or demand required to be given or made tinderthis guarantee may be given or made by leaving the same or sending itthrough die post in a prepaid envelope addressed in the case of a notice to oe given to you to 91 Menion Square indie City of Dublin andin allother cases to the Company orperson to or upon . whom die notice or demand is to be given or made attheirregistered or principal • office or lastknown place of abode and a notice or demand so given or made shall be deemed to be given or made on the day itwas so leftor the day following that ' on which itis posted as-the case may be. 1 . 7 18. \ f j As a separate and independent stipulationdie Guarantor agrees that any sum or sums of money intended to be die subject of this guarantee which may not be legallyrecoverable from die Principalwhether by reasonof any legallimitation, disability: infancy or incapacity ofthe Principal or any other fact or circumstance and whether known toyou ornot shall nevertheless be recoverable from the Guarantor as sole or principal debtor in respectthereofand shall.berepaid to you by die Guarantor on demand. ' Iffor the purposes ofobtainingjudgement in any Court itisnecessary to convert a sum due hereunder in one currency (in this clause called die "firstcurrency") into another currency (in this clause calleddie "second currency") the rate of exchange which shall be applied shallbe that atwhich in accordance with die normal banking procedures* you could purchase the firstcurrency with the second’ currency on the business day preceding that on which finaljudgement is given and die Guarantor's obligation in respect of any such sums due from itto you hereunder shall not withstanding any judgement in the second currency, be discharged only to the extent that on the Business day following receiptby you of any sum judged to be due hereunder in a second currency you may in accordance ■withnormal ranking procedures purchase die firstcurrency with the second • currency. Ifthe firstcurrency so purchased falls short of the sum originally due to you in tne firstcurrency the Guarantor agrees that itshall as a separate obligation and notwithstanding any such judgment indemnify you against such shortfall. 19. v 20. (■ Notwithstanding any otherprovision hereof all amounts payable or expressed to ___ __________ ___ deposit in Depc Guarantor with you and shall be recoverable by you only from and to the extent of the amount so deposited by the'Guarantor with you P R O V I D E D the amounts so deposited by the Guarantor shall at no time be less than a principal amount of IEP310,000 together with interest accrued thereon ATOP F U R T H E R P R O V I D E D T H A T the Guarantor shall not withdraw any sum so deposited in Deposit Account No. (!)l/46540/77with you without your prior written consent . This Guarantee shall be governed by the laws of Ireland. - IN W I T N E S S whereof this Guarantee has been executed the date and. year firstherein ’ * •written. Present when the C o m m o n Seal of Cayman International Bank and Trust Company limited was affixed hereto:- ) ) ) ) •, ' .*» i MARTINA INVESTMENTS LIMITED NOTES TO THE ACCOUNTS foriha year ended 5th Apnl,1993 I • • 1. FIxedA&ssts . 331/3% of Oiacarrr Partnership fixed assets (as fotea in Ifta Financial Statement of Diacom aa at5.4;93) 223,039 R e d assets as per Prouds Rentals list far Martina Investments Ltd at historic cost value . 439.463 '. . £662,502 2. Loan Accounts Loan accounts are unsecured, interest free and unlikely to be repaid in the foreseeable future. ' 3. Share Capital Authorised Issued; 4. 5,000 shares of£1 each 905' shares of £1 each Capital Reserves ' 333,241 33 1/3% Caprfal account (Ofacom Partnership] 334,627 Capital Reserve brought forward £ 5. 667.868 Rents Received Rental Income Prcuds Rentals (as eer financial statements of 5.4.93) . 331/3% rental Income Diacom Partnership (as par financial statements of 5.4.93) 26Z692 . ‘ • A O A 5. Faes R ec*rvahte • Sundr/ Income Dfacom Partnership 33 t/3% '• P r o t i t o n E x c h a n g e - £ . ’ i • Profit dua la revaluation of frbh Punt accounts & gaakJqtOTtti £ PropertyEttMnses Pftwds Rantals £ 27 . . . ; 14..517 Dfeoam Partnefship 331/3% ' 77,388 . Interest received OHCCm Partnership 33 7/3% 9. 4gg 25,<170 £ 39.387 MARTINA I N V E S T M E N T S U M f T E D REVENUE A C CO U N T for (he year ended 5th April, 1993 1993 Nates 16J38^3 to 05.04.32 £ £ INCOME Rants Recarved rees Received PreRon Exchange Bank Interest 313,830 5 6 7 8 1.463,353 23.820 499 77.989 * 27 19.575 3.487 392,154 1.510.840 EXPENDITURE "■ Property Expenses 9 Secretarial Fees Registered Office Fees Legal & Professional Fees Exempt Tax Sundry Expanses 124,406 11,077 575 920 2.025 1,033 39,997 1,252 100 ' 500 71 41,910 140.036 SURPLUS BEFORE TAXATION. 350,244 1.370,804 TAXATION (67.007) (395,256) SURPLUS FOR Tl IE YEAR/PERIOD 233,237 9/5,548 • 1.072,851 97,303 BALANCE BROUGHT FORWARD MARTINA INVESTMENTS LIMITED BALANCE SHEET asat 50tApril,1393 1993 e N o t t s . FIXSOASSETS ; 1992 . £ £ 662.503 € 652.628 CURRENT ASSETS Loans Accounts Bank Balances 2 Debtorsand Prepayments 1,361,523 5a S61 1,076,593 58 S35 1.362,548 1,077,592 CURRENT UA8IU7IES 190 Creditors NEr CURRENT ASSETS 537 1,362,353 1.0r7,055 £2,024.851 £1,739,683 SO5 667,sea SOS 665,927 Hepr&sented by: Share Capital CaprfcaJ Reserves Revenue Account 3 4 1,356,088 £ 2,024,861 Far M artina investments umitcd Date 1,072,851 *P#l>03.27.'?4 161 IS FSOrt CITCO HO. t: pbse j C a y m a n IrtemafionaJ Bank and Trust Company Limited In tern ation al Trosf Group P.O.Box887 GrantCayman Westirxfej Tahptont8099498655 retoCP<305 Facs>nla8C9 949 7946 Telefax Frame J. Maxine Everson To: Guiness Mahon Ltd Dublin ' A t t e n t i o n : France Collins Fax No: 353-1 6796242 Date; M a y 27,1994 Refna-010 JME/lm No. ofPages (includingthisone): I I a m in receipt ofyour fax ofMay 26th in connection with the loan interest due on Ma y 27th. • I would be grateful ifyou could send thisinformation to the following address:Proud Rentals, 3 Proud's Lane, Stephen Green W, Dublin 2, Ireland. ’ Thank you foryour cooperation. Kind regards, isincerely, Jj _; i/_ he Everson ■Hr ■ • / V -£ e :!t5. A f^ IF Y O U H A V E H O T This hdratk H E C E IV S O T h e andfer &>• *ppHcaW» taw. H t h a r o a d «r E in o t lh « i unaulhofijsd um , M A R T I N A INVESTMENTS LIMITED P.O. Box 887, George Town, Grand Cayman, Cayman Islands British West Indies Facsimile (809) 949 7946 Telephone (809) 949 8655 27th January, 1997 Our Ref: 6465 . The Manager IrishIntercontinentalBank Limited ,91 Merrion Square Dublin 2 ' Republic ofIreland. Fax Attn: Mr. Aidan Storey .) Dear Sir, 011-3531-678-5034 . ' W e hereby authorise and request you to j held with yourselves to:- copy statements and advices on our accounts) Prounds Rentals •• 3 Proud’s St. Stephe; Dublin ’ Telefax 478 1755 FAOM.T. Conway You are also authorised to discuss the account with any representative ofProud’s Rentals. This authority does not extend to Pround’sRentals signing any instructions in relation to the ■ ■ account and is purely to enable you to divulge information concerning'the accounts) to Pround’s Rentals. . . . « Yours faithfully, foilManila Investments Limited CawsantFlEhni Director cc M.T. Conway 011 3531 478 1551 Registered Office: 7-11 Britannia Place, Bath Stree,St.Hellier,Jersey i38<3 / Mr. Michael Enoch has a Power of. Attorney from Martina to close, and has instructed solicitors* and act for the . company. Proud Rentals in Dublin will manage the property. Martina wouLd like to borrow from Guinness & Mahon, Dublin I£310,000 as we have been advised that interest on such borrowing will be an offset against income for tax purposes. The terms we would like them to consider are: . 1. Term: 5 years - with no principal repayments. 2. Interest: Payable annually. : 3. Security; First Mortgage over property purchased. In addition we are prepared to * place and hypothecate a ...deposit of I£320,000 at an interest rate of £ of 1% less than the rate on the loan'. " , • . ■ As usual, time is tight. If agreed/ would like whilst documentation is being completed that we give Guinness 7 Mahon the foreign currency to convert into IriBh Pounds and pay to Proud Rentals in chair name for completion, with that being the date for the origination of the loan if and when completed. • Proud Rentals banking informatJb<3h is as follows: Bank of Ireland . College' Green, Dublin % * Sort Code: 900017 '* ’ For credit a/c Proud Rentals a/c 59381207 ■ . • « You will ncjte the j of 1%. The client is paying 1%; i to Dublin J .to us. In all the circumstances we may have to forego our turn! ' • 'egards, •. ..INS JAC:ee ' The information contained in this transmission is confidential and intended onlv for the use of the individual or entity to w h o m it is addressed. If you have received this transmission m error, please notify us immediately and return the original transmission to us. Appendix XV (37) Mr Bernard Etzin 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Bernard Etzin. a) Note of telephone attendance of 28 M a y 2001 - Solicitor to the Inspectors with M r Bernard J Etzin. b) Guinness and M a h o n credit committee m e m o of 1 June 1977. c) Letter of 22 February 1978 - Guinness and M a h o n to J D Traynor. w:va? I T e lephone Attendance Our Ref: C/E07 Date: Wednesday 23rd May, 2001 at440pm approx. With Mr. Bernard J. Etzin Mr. Etzin telephoned the office this afternoon and would not leave his name. He asked to speak directly with m e and Itook the call. Mr. Etzin identifiedhimselfand toldm e he was ringing m e in connection with a letterthat Ihad written to Mr. Thain Wilbur. He wanted to know why Iwas looking forhim. Iexplained to him thatIwas a Solicitorto the High Court Inspectors appointed to inquire into the Affairs ofAnsbacher (Cayman) Limited in Ireland. I asked him had he received the Inspectors letterwhich had been forwarded to him in February. He confirmed he had received a letterbut had promptly disposed of it as he did not think he was involved to any extent He then went on to explain thathe did have an accountwilh Guinness & Mahan Limited in Ireland He told m e he was a U S citizen and thathe had permission to have an account abroad and not to bring U S dollar earnings intothe sterling area. He leftBrother International Limited with U S $ 1,000,000 million settlement He contacted Mr. Traynor in connection with this million dollarsettlement as he needed a place to bank the cheque. He asked Des Traynor who was on die Brother Board to assisthim inplacing the cheque abroad. He knew he had connections and Mr. Traynor toldhim through his connections abroad thathe would be able to bank the money in Cayman. The settlement was negotiated and agreed apparently in N e w York where Mr. Etzin was met by a representative w h o m he described as a junior ofa Cayman Bank who attended a meeting at which he was present and atwhich die U S $ 1,000,000 million dollarcheque was drawn on Brother. He toldm e that ifthe cheque had been banked in the Sterling area he was open to taxation in Dublin as he was resident in London. He toldm e thathe was dealing with die London and Dublin operations ofBrother and that he had resided in Dublin fora period of 18 months. He told m e thathe was aware thatDes Traynorwas involved with Charles J. Haughey and that this was the subject ofsome Tribunal in Ireland. Iexplained to him thatthis was not the Tribunal enquiry. These were Inspectors appointed under the Irish Companies Act by the Irish High Court to enquire into the operation ofAnsbacher (Cayman) Limited in Ireland He told m e that Des Traynor told him was itwas a Canadian Bank and he couldn’trecall it’s name but Isuggested thatperhaps the Bank in question was called Bank ofNova Scotia and he agreed He toldm e thatthis meeting took place aftersome prompting in the second halfof 1974. He then went on to explain to m e thathe had sold his residence in London as parking became untenable. He isnow living opposite Dawson Square near the Thames River at 130 Grosvenor Road, SW1, London. Telephone: Fax: 0207 - 6300709 0207 - 6306942 Itold him that Iwould have to pass on this information to the Inspectors who would then consider itand subject to theirinstructions Iwould contact him further. M a r y Camming, Solicitor to the Inspectors. Marties Limited: Amounh £85,000 * To meet poyfant under Letter of Credit £72,150 plus V.A.T. 20% an dellveiy of goodi balance 5 months after Purpote: .4 28th February, 1978. Term; V* Roly ““ “ Drawdown: Security: , 4 Bow Rato plui 3% Byway of loan tn the name of above G uarantee of B. J. Etzin* Suitably Secured. Recommended. 'O Dated V ' U - * xv fru^/l -Jt C. J . D . T ^ fy n o r, ®*q« C/o 17. C o lic s * G re ta , DUBLIN 2 . 6U3MNESSrf-MAHOM UD 17Col!*9*Qr»»nDaain2Ra33x55Mfe!aphone:7B»«4 22nd F e b ru a ry , 1978 Dear Sir/^ladan, ' Please fin d l i s t e d below S e c u ritie s held f o r y o u r Aoeoont as a t 22ad February, 1973 ■ ' Ve should be g r a t e f u l i f you would sign th e e n clo s e d copy of'* t h i s le t t e r* e 6 n ftra in s th a t y o u r records are in agreeaent v i t h o u r s . C o n td / -— CONTINUATION S H U T Brown uvilopi f Cloaod vhito owrolopo aarkod M « M d WSowB*#BT#lop*^»»k«4 "A«roo*oiit rt Ot Copjr «f Will S n v d o p * M r k t d hold for p ip a r i Cloaod brova oorolopo m r k o d k i m i Noainooa aod Appendix XV (38) Mr Sam Field-Corbett 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r S a m Field-Corbett. a) Transcript of evidence of M r S a m Field-Corbett dated 30 March 2000. b) Schedule of names prepared by Padraig Collery. UNDER OATH ON THURSDAY, 30TH MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer MR. JUSTICE COSTELLO MS. M A C K E Y BL S o l i c i t o r to the Insp e c t or s MS. M. C U M M I N S Interviewee: MR. SAM FIELD-CORBETT R e p r e s e n t e d by: MR. R A Y F U L L H A M SC I n s t r u c t e d by: MR. EOIN O'CONNOR The Inspectors: EOIN O'CONNOR NAAS COUNTY KILDARE WITNESS MR. S. FIELD-CORBETT I EXAMINATION MR. JUSTICE COSTELLO PAGE 13 1 2 3 4 MR. JUSTICE COSTELLO: Mr. Field-Corbett, we will start our interview 5 6 then. 7 MR. FULLHAM: B e f o r e y o u s t a r t Ju d g e . 8 MR. JUSTICE COSTELLO: Yes? 9 MR. FULLHAM: C o u l d I just sa y for the 10 re c o r d that we are not 11 here voluntarily. 12 MR. JUSTICE COSTELLO: Yes. 13 MR. FULLHAM: We are here under compulsion. 14 15 MR. J U S T I C E C O S T E L L O : We p e r f e c t l y understand. I u n d e r s t a n d t h a t. 16 17 MR. F U L L H A M : A n d y o u u n d e r s t a n d tha t. 18 MR. J U S T I C E C O S T E L L O : Yes . 19 MR. F U L L H A M : T h a n k you. 20 MR. J U S T I C E C O S T E L L O : Mr. 21 Field-Corbett, I am sure your counsel and 22 y o u r s o l i c i t o r h a v e e x p l a i n e d t o y o u t h a t t h i s is 23 n o t a C o u r t a n d it is n o t a T r i b u n a l . 24 MR. FIELD-CORBETT: Yes. 25 MR. JUSTICE COSTELLO: It is a n i n v e s t i g a t i o n . have been appointed by 26 27 T h e H i g h C o u r t a n d m y c o l l e a g u e Ms. 28 right has also b e e n appointed. 29 Inspectors. M a c k e y on m y We are the I 1 2 MR. JUSTICE COSTELLO: If d u r i n g t h e c o u r s e of the i n t e r v i e w yo u w i s h to 3 4 c o n s u l t w i t h y o u r c o u n s e l or s o l i c i t o r p l e a s e tell 5 m e so a n d w e w i l l s t o p o u r q u e s t i o n s . 6 MR. FIELD-CORBETT: Yes 7 MR. JUSTICE COSTELLO: A n d if d u r i n g t h e c o u r s e 8 9 of t h e i n t e r v i e w e i t h e r y o u r s o l i c i t o r o r c o u n s e l w i s h to c o n s u l t w i t h you, 10 t h e y a r e at l i b e r t y t o t e l l m e so a n d w e w i l l s t o p 11 our questions. 12 MR. FIELD-CORBETT: O ka y . 13 MR. JUSTICE COSTELLO: Mr. under oath and I will ask 14 15 our solicitor, 16 o a t h t o you. 17 18 19 20 21 22 23 24 25 26 27 28 29 F i e l d - C o r b e t t , t h i s is Ms. Cummins, n o w to a d m i n i s t e r the 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Field-Corbett, we did ask you for a full a 6 detailed statement? 7 A. 8 2 Q. 9 Yes. Of your d e a l i n gs w i t h the c o m p a n y a nd you d id not g i v e it to u s ? 10 A. 11 3 Q. No. I t a k e it t h a t y o u h a v e b e e n a d v i s e d b y y o u r c o u n s e l 12 a n d s o l i c i t o r t h a t y o u a r e r e q u i r e d u n d e r S t a t u t e to 13 c o o p e r a t e w i t h us a n d g i v e u s y o u r a s s i s t a n c e ? 14 A. 15 4 Q. 16 A. 17 5 Q. 18 A. 19 6 Q. 20 A. 21 7 Q. 22 A. 23 8 Q. 24 A. 25 9 Q. Well, I i n t e n d to give e v e r y a s s i s t a n c e . You will? Yes. Very well? Yes. I j u s t w a n t to g e t t h a t c l e a r ? Yes. Y o u w i l l a s s i s t us n o w ? I w i l l a s s i s t you. To the b e s t of y o u r a b i l i t y ? Yes, yes. W e a r e c o n c e r n e d t o d a y Mr. F i e l d -Corbett just with 26 your own in v o l v e m e n t wi t h the c o m p a n y called, 27 is n o w c a l l e d , 28 29 A. Yes. "Ansbacher"? which 1 2 11 Q. 3 Perhaps, t h e s i m p l e s t t h i n g m i g h t b e if w e w e n t a n d l o o k e d at A p p e n d i x C of t h i s l e t t e r w e s e n t y o u ? 4 A. 5 12 Q. Yes. It is p a g e 8, I think, a n d w e se t o u t t h e s t a t e m e n t 6 t h a t w e a s k e d for. 7 you w ill see the p art of p a g e 8 "Cayman Island Trusts and Trust companies"? 9 A. 10 13 Q. If y o u t u r n o v e r t h e p a g e t h e n Yes. W e a s k e d y o u d i d y o u c a u s e to b e e x e c u t e d a d e e d o f 11 t r u s t in t h e C a y m a n I s l a n d s . 12 that? 13 A. 14 14 Q. 15 A. 16 15 Q. 17 A. 18 16 Q. 19 A. 20 17 Q. 21 A. 22 18 Q. 23 A. 24 19 Q. 26 A. 27 20 Q. 28 A. 29 W h a t is t h e a n s w e r to Yes. The name of the company, t h e n a m e of t h e t r u s t w a s ? A u c k l a n d Trust. T h e r e w a s a c o m p a n y a s s o c i a t e d w i t h it? Auckland Investments. Investments? Yes. W h a t y e a r d i d yo u set that up? I t h i n k it w a s t h e l a t e 1 9 8 0 ' s . Have you made enquiries about this? I have but I h a d d i f f i c u l t y in g e t t i n g t h e documentation. 25 9 t h a t is h e a d e d T h e t r u s t w a s se t u p b y Mr. Traynor. Yes? A n d he set u p t h a t w h o l e s t r u c t u r e . Yes? A n d t h e r e l a t i o n s h i p b e t w e e n Mr. Tray n o r and I was as s u c h t h a t t h e r e w a s n o d o c u m e n t s b e t w e e n us. 1 21 Q. 2 A. 3 22 Q. 4 Yes? I t o o k h i s w o r d t h a t t h i n g s w e r e do n e . I a m j u s t w o n d e r i n g w h y y o u t h i n k it w a s t h e late 5 A. 6 23 Q. 1980s? Do y o u n o t t h i n k it w a s e a r l i e r ? I c a n ' t a b s o l u t e l y b e sure, Y o u see, yes. as I u n d e r s t a n d t h e e v i d e n c e t h a t y o u g i v e 7 to the M o r i a r t y Tribunal, 8 y o u a b o u t t h e p o s s i b i l i t y o f so d o i n g it i n t h e 9 late 1970s and e arly 1980s? Yes, t h a t is c o r r e c t . 10 A. 11 24 Q. 12 A. 13 25 Q. 14 15 Mr. T r a y n o r h a d t a l k e d to Was t h e r e . . . (INTERJECTION)? I ... ( I N T E R J E C T I O N ) . A n inte r v a l of time h ad e l a p s e d be f o r e his first t a l k to you? A. 16 C e r t a i n l y in the m i d 1970s I didn't have any reason for ha v i n g such an account. 17 26 Q. 18 A. 19 27 Q. 20 A. 21 28 Q. Yes? Because I h a d j u s t s t a r t e d u p in b u s i n e s s . Yes? And I hadn't...(INTERJECTION). It w a s t h e n w h e n y o u f i n a n c i a l l y f e l t t h a t y o u 22 s h o u l d a v a i l o f t h i s o f f e r t h a t y o u t o o k it up, 23 t h a t it? 24 A. 25 29 Q. 26 A. 27 30 Q. 28 A. Yes. 29 31 Q. Yes. T h a t is c o r r e c t , yes. You t h i n k this was the late 1980s? Well, it w o u l d b e t h e m i d 1 9 8 0 s . The m i d 1980s? W e l l ... ( I N T E R J E C T I O N ) ? is 1 A. I a m s o r r y I c a n ' t b e m o r e s p e c i f i c i n r e l a t i o n to 2 the dates. 3 MR. FULLHAM: Perhaps, 4 Ju d g e , if y o u c o u l d r e f r e s h his 5 m e m o r y by r e f e r e n c e to his e v i dence to the 6 Moriarty Tribunal? 7 MR. JUSTICE COSTELLO: No, 8 it is a l l r i g h t . is g i v i n g e v i d e n c e to m e 9 here n o w today. 10 MR. FULLHAM: T h a t is fine. 11 MR. JUSTICE COSTELLO: Yes. 12 If h e c a n n o t r e m e m b e r he c a n n o t 13 remember, 14 MR. FULLHAM: Yes . MR. JUSTICE COSTELLO: Y o u t h i n k it w a s t h e 15 32 Q. in d e t a i l . 16 e arly 1980s? 17 A. 18 33 Q. 19 A. 20 34 Q. 21 A. 22 35 Q. 23 A. 24 36 Q. 25 I ... ( I N T E R J E C T I O N ) . So r r y , Yes, Mr. middle 1980s? m i d 19 80s , yes. Field-Corbett, y o u l e f t it a l l t o Mr. Traynor? T h a t is c o r r e c t . To e s t a b l i s h ? Yes. Have you made enquiries in t h e C a y m a n I s l a n d s a b o u t t h i s at a l l ? 26 A. 27 37 Q. 28 A. 29 He A f t e r Mr. T r a y n o r 's d e a t h , right. Yes? I was u n s u r e that the arrangement, w e r e s t i l l t h e r e a n d I r a n g a Mr. the companies, B e n j a m i n to 1 e n q u i r e a n d he i n f o r m e d m e t h a t t h e c o m p a n y h a d b e e n 2 s t r u c k o f f a n d I a s k e d h i m to g e t it r e i n s t a t e d . 3 T h a t is t h e e n q u i r i e s t h a t 4 subsequently confirmed, w h e n I r a n g h i m b a c k he 5 subsequently confirmed, that the c o m p a n y was 6 reinstated. 7 38 Q. 8 A. 9 39 Q. 10 I w o u l d h a v e m a d e a n d he A r e y o u s u r e t h a t w a s a f t e r Mr. Traynor's death? Yes. M y r e c o l l e c t i o n is t h a t y o u i n f o r m e d t h e M o r i a r t y T r i bunal that that was in about 11 A. 12 4 0 Q. T h a t is n o t m y r e c o l l e c t i o n . Maybe I h a v e g o t it w r o n g . w a s a f t e r Mr. 13 14 A. 15 41 Q. 16 1988? Maybe I am wrong. Traynor's death? Yes. A f t e r Mr. T r a y n o r ' s death, I think, Mr. Collery went to the Cayman? 17 A. 18 42 Q. 19 He did, yes. A n d came b a c k to yo u an d g a v e yo u an account, A. 21 43 Q. Correct. Mr. Field-Corbett, am I correct in saying that you 22 u n d e r s t o o d c o m p l e t e l y w h a t w a s i n v o l v e d in 23 establishing this trust? 24 document? 25 A. 26 4 4 Q. 27 29 did he ? 20 28 It No, no. You knew that like that? A. Yes. You did not sign the s o m e b o d y s u c h as Mr. F u r z e or s o m e b o d y 1 2 46 Q. 3 is that right? 4 A. 5 47 Q. 6 Yes. Did you u n d e r s t a n d then that the trust w o u l d lend m o n e y to the c o m p a n y that was b e i n g est a b l i s h e d ? 7 A. 8 4 8 Q. 9 A. 10 4 9 Q. 11 Yes, yes. Auckland Investments? T h a t is r i g h t , yes. Did you u n d e r s t a n d about the coded accounts system t h a t w a s b e i n g o p e r a t e d in t h e B a n k ? 12 A. 13 50 Q. 14 A. 15 51 Q. 16 A. 17 52 Q. 18 A. 19 53 Q. 20 To myself. Yes? To m y own p o s i t i o n . Yes. O n l y to y o u r s e l f ? Yes. In r e l a t i o n to y o u r s e l f t h e r e was a c o d e d a c c o u n t ? T h a t is c o r r e c t . Y o u w o u l d b e e n t i t l e d t o lo d g e , add, m o n e y to t h e account? 21 A. 22 54 Q. 23 A. 24 55 Q. 25 A. 26 56 Q. 27 A. 28 57 Q. 29 Y o u w o u l d t h e n t r a n s f e r funds to the trust, Yes. And withdraw? Yes. Y o u d i d a d d m o n e y f r o m t i m e to time? I did. A n d yo u d i d w i t h d r a w f r o m t i m e to t i me? I did. I t h i n k y o u u s e d t h e a c c o u n t a l s o f o r t h e p u r p o s e of 1 2 58 Q 3 A 4 59 Q 5 A 6 60 Q 7 A I see? If I m a y j u s t e x p a n d . Yes ? On that p a r t i c u l a r aspect of the thing. Yes? T h a t m y r e c o l l e c t i o n is t h a t 8 had bought a premises 9 g r o u p o f us, 10 61 Q 11 A 12 62 Q 13 A I a p p r o a c h e d IIB. i n S o u t h C i r c u l a r Road , Yes ? A n d they refused. Yes ? They m a i n t a i n e d that the amount i n v o l v e d was too s m a l l f o r t h e m in t h e o r d i n a r y c o u r s e of t h e i r 15 business. 63 Q 17 A 18 a a n d I a p p r o a c h e d II B f o r a loan. 14 16 We Yes ? A n d I t h e n s a i d i f it w a s c a s h b a c k e d w o u l d t h e y do t h e l o a n a n d t h e y s a i d yes. 19 64 Q 20 A Yes? So, it w a s n ' t a q u e s t i o n o f t h e n o r m a l b a c k to b a c k . 21 I h a d t o b a c k it b e c a u s e t h e y w o u l d n ' t g i v e us t h e 22 loan. 23 65 Q 24 A 25 66 Q Yes ? U p fr on t. Yes. However, t h e p o i n t is t h a t y o u u s e d t h e 26 d e p o s i t t h a t w a s i n t h e n a m e o f " A n s b a c h e r " as 27 s e c u r i t y for the loan? 28 29 A Y e s -- we l l , Mr. Traynor organised. 1 2 68 Q. Yes. You are aware that that m o n e y that you had put in the trust was on deposit, 3 4 A. 5 69 Q. 6 A. 7 70 Q. 8 T h a t is c o r r e c t , is t h a t r i g h t ? yes. Y o u k n e w t h a t it w a s e a r n i n g i n t e r e s t ? Yes, I did. W o u l d I be c o r r e c t in s a y i n g that yo u d i d not r e t u r n t h e i n t e r e s t in y o u r t a x ? 9 A. 10 71 Q. No. I t h i n k t h a t is a l l w e n e e d t o a s k y o u 11 Mr. 12 c o m e b a c k t o g i v e u s f u r t h e r a s s i s t a n c e at a l a t e r 13 date? 14 A. 15 72 Q. 16 A. 17 7 3 Q. 18 A. 19 F i e l d - C o r b e t t today. W e m a y h a v e t o a s k y o u to O k ay . However, w e w i l l l e t y o u k n o w i f t h a t is so? O k ay . T h a n k you. Okay. MR. T h a n k you. FULLHAM: T h a n k you. 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED ML. 9.64;: . 7. i lField-CorbettSamMr [Ansbadver?-lR [Ne senesjzz Pine Va?eyAva. Dublin 16. THE HIGH COURT IN T H E M A TTER OF T H E C O M P A N IE S A C T S 1963 to 1990 AND IN THE M ATTER OF PA R T II OF TH E CO M PAN IES A C T 1990 AND SECTIONS 8 AND 17 AN D IN T H E M A TTER O F A N SB A C H ER (CAYM A N) LIM ITED (formerly GUINNESS M A H O N CAYM AN TR U ST LIM ITED, A N SB A C H ER LIM ITED and CAYM AN IN T E R N A T IO N A L BANK A N D TR U ST COM PANY LIM ITED ) R epo rt of th e In spe c t o r s A p p o in t e d t o E n q u i r e in t o t h e A f f a ir s o f A n s b a c h e r ( C a y m a n ) L im it e d Published by Order o f the Court made on 24 June 2002 V olum e [6 ]: A p p e n d ix X V (4 3 ) to X V (5 4 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (43) Mr Denis Foley 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Denis Foley. a) Transcript o f evidence of Mr Denis Foley dated 7 April 2000. b) Statement and related appendices of Mr Denis Foley dated 7 April 2000. AppendixvaSM) UNDER OATH ON FRIDAY, 7TH A P R I L 2000 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer MR. JUSTICE COSTELLO MS. M A C K E Y BL S o l i c i t o r to the I n s p e c t o r s MS. M. C U M M I N S Interviewee: MR. DENNIS FOLEY R e p r e s e n t e d by: MR. TOM 0'HALLORAN The I n s p e c t o r s : UPPER ASHE STREET TRALEE C O . KERRY WITNESS MR. D. FOLEY I EXAMINATION MR. JUSTICE COSTELLO MS. MACKEY 36 PAGE 35 39 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Fo le y, we will start o u r i n t e r v i e w t he n . I am 6 D e c l a n C o s t e l l o a n d o n m y r i g h t is Ms. 7 you know we have b e e n a p p o i n t e d b y The H i g h Court 8 as I n s p e c t o r s . Mackey. As 9 10 I should explain, 11 to interview, 12 a Tribunal. as I d o to o t h e r p e o p l e w h o c o m e t h a t t h i s is n o t a C o u r t a n d it is n o t It is a n i n t e r v i e w . 13 14 If i n t h e c o u r s e o f t h e i n t e r v i e w I or M s . M a c k e y 15 a s k y o u a q u e s t i o n o n w h i c h y o u w o u l d l i k e to t a k e 16 legal advice, 17 q u e s t i o n i n g a n d y o u c a n t a l k t o Mr. p l e a s e tell me and we will stop O'Halloran. 18 19 Similarly, 20 asking questions 21 w i t h you, 22 will stop asking the questions. 23 MR. 24 25 26 27 28 29 F OL E Y : if y o u r s o l i c i t o r w i s h e s us t o s t o p so t h a t h e c a n d i s c u s s t h e m a t t e r h e c a n i n d i c a t e t o us t h e p o s i t i o n a n d we T h a n k you Judge. 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Fo ley , statement we got a from you 6 y e s t e r d a y an d we got the a p p e n d i c e s this m o r n i n g an d 7 b e c a u s e w e h a v e n o t h a d t i m e to c o n s i d e r a l l t h e s e 8 documents, 9 us t o c a l l y o u b a c k at a l a t e r d a t e ? 10 A. 11 2 Q. 12 A. 13 3 Q. However, Right, position? 4 Q. see h o w we can get on this m o r n i n g ? It m a y n o t b e n e c e s s a r y f o r u s t o t r o u b l e y o u a g a i n . 15 17 we will Sir. However, A. it m a y b e n e c e s s a r y f o r Yes. 14 16 as w e w o u l d like, Yes. I h a v e to t e l l y o u t h a t t h a t is t h e Right, Sir. It d i d o c c u r to me, Mr. Foley, c o n s i d e r i n g the 18 documents, 19 w h o l e m a t t e r o f o u r i n t e r v i e w w i t h y o u i n t h i s way: 20 Y o u r s t a t e m e n t i n d i c a t e s the s tate of k n o w l e d g e 21 w h i c h you said you had about the funds you gave 22 t o Mr. 23 A. 24 5 Q. Yes, As t h a t it m i g h t b e p o s s i b l e t o s h o r t e n t h i s Traynor? Sir. I u n d e r s t a n d y o u r s t a t e m e n t y o u r s t a t e of 25 k n o w l e d g e h a s n o w c h a n g e d c o n s i d e r a b l y as a r e s u l t 26 of d o c u m e n t s that were m a d e a v a i l a b l e to you? 27 A. 28 6 Q. 29 At the Tribunal, t h a t is r i g h t , I t h i n k I a m c o r r e c t in s a y i n g , Sir. a n d c o r r e c t m e if I 1 knowledge were these bank statements that were given 2 to yo u s h o w i n g that m o n e y that was in the n a m e of 3 "Ansbacher" 4 n a m e o f H a m i l t o n Ross, 5 correct? 6 A 7 7 Q firstly, T h a t is c o r r e c t , an d t h e n m o n e y t h a t was in the which was deposited, is t h a t Sir. A l s o it a p p e a r s t h a t t h e r e w a s a c o d e g i v e n o n t h e 8 r i g h t - h a n d side of the documents. 9 c o r r e c t i n s a y i n g Mr. I think I am F o l e y t h a t it is q u i t e c l e a r 10 that you w ere one of the c o d e d ac co u n t s that 11 "Ansbacher" had and then later Hamilton Ross had? 12 A 13 8 Q 14 A 15 16 That w a s . . . (INTERJECTION). Do you a c cept that? T h a t w a s b r o u g h t to m y n o t i c e at t h e T r i b u n a l , Judge. 9 Q Yes. Mr. Foley, w o u l d it n o t 17 company "Ansbacher", 18 its n a m e ? 19 Trust? 20 A 21 10 Q follow that this w h o m I a m d e a l i n g w i t h, changed It w a s o r i g i n a l l y G u i n n e s s M a h o n C a y m a n Yes . That your m o n e y was part of the d e po s i t that that 22 c o m p a n y h a d e v e r s i n c e 197 9 w h e n y o u f i r s t g a v e t h e 23 m o n e y to Mr. 24 A 25 11 Q Judge, Traynor? can I explain about 1 9 7 9 if y o u d o n o t m i n d ? Of course? 26 In O c t o b e r 197 9 w h e n I w e n t t o G u i n n e s s 27 lodge the £50,000 28 j o i n e d t h e c o m p a n y t h e r e in t h e d i s c u s s i o n s a n d 29 Mr. I m e t Mr. Traynor assured me that Traynor. & M a h o n to Mr. Keane I w a s g o i n g i n t o an 1 2 12 Q 3 A 4 13 Q 5 What I a m d o i n g Mr. So r r y , Foley? Sir. W e w il l , of course, a l l o w y o u t o g o i n t o a l l of that? 6 A 7 14 Q 8 A 9 15 Q 10 Sorry. If it is n e c e s s a r y ? Yes . I a m j u s t a s k i n g y o u n o w i n t h e l i g h t of t h e documents that you have now received? 11 A 12 16 Q T h a t is r i g h t , Sir. D o e s it n o t l o o k as if y o u r m o n e y w a s o n d e p o s i t in 13 the name of G u i n n e s s M a h o n C a y m a n Trust, 14 "Ansbacher", 15 coded accounts? 16 A 17 17 Q 18 A 19 18 Q in D u b l i n a n d that yo u w e r e one of the T h a t is r i g h t , Sir. It l o o k s l i k e that , T h a t is r i g h t , d o e s it n o t ? Sir. I w i l l c o m e to in a m o m e n t w h a t y o u b e l i e v e d to b e the position? 20 21 A 22 19 Q 23 Yes . You did receive documents f rom time to time a nd the t o p w a s cu t o f f t h e m ? 24 A 25 20 Q Yes . W e h a v e h a d a l o o k at t h e s e d o c u m e n t s a n d it is 26 quite clear that these documents 27 t h a t w a s s h o w n to b e y o u r s , 28 interest? 29 later show that the m o n e y the capital, was earning 1 21 Q. 2 A m I c o r r e c t in s a y i n g t h a t y o u d i d n o t r e t u r n t h e i n t e r es t on any of the m o n e y ? 3 A. 4 22 Q. 5 A. 6 23 Q. No, Sir. To t h e R e v e n u e A u t h o r i t i e s ? No, Sir. J u s t a p r o p o s o f tha t, d i d y o u h a v e a n a c c o u n t a n t to 7 look after your tax affairs or did you handle the m 8 yourself? 9 A. 10 I h a d an a c c o u n t a n t in T r a l e e l o o k i n g a fter m y tax a f f a i r s in Tralee. 11 24 Q. 12 A. Yes? A n d t h e n s o m e t i m e i n 1 99 8 I m a d e an a p p o i n t m e n t here 13 w i t h an a c c o u n t a n t in Dublin. I have been trying 14 s i n c e 1 9 9 1 to c l o s e t h e a c c o u n t a n d I m a d e an 15 appointment 16 in D u b l i n and he i n s i s t e d on g e t t i n g statements. 17 I told him my po s i t i o n that 18 d i s c l o s u r e to the R e v e n u e C o m m i s s i o n e r s . in 1 9 9 8 h e r e w i t h a n a c c o u n t a n t 19 25 Q. 20 A. In Tralee, 21 26 Q. In T r a l e e ? 22 A. L o ughran & Company. 23 27 Q. Loughran & Company? 24 A. 25 28 Q. Just who was your accountant I w a n t e d to m a k e a full in L i s t o w e l ? my accountant...(INTERJECTION). Yes. D i d y o u d i s c l o s e to t h e m t h a t y o u h a d t h i s m o n e y 26 that was e a r n i n g interest and that you were not 27 r e t u r n i n g it? 28 A. 29 29 Q. No, Sir. Y ou did not r e t u r n that? 1 2 30 Q. 3 W h e n yo u came up in 1991 t h e n to a D u b l i n a c c o u n t a n t what d i d . . . (INTERJECTION)? 4 A. 5 31 Q. 6 A. 7 32 Q. 8 A. 9 No, i n 1 9 9 1 I c a m e to De s T r a y n o r . De s T r a y n o r ? Yes, w h i t h a v i e w to c l o s i n g t h e a c c o u n t . I see? A n d he t o l d m e at t h a t s t a g e t h a t I w a s i n a t e n y e a r cy c l e . 10 33 Q. 11 A. 12 34 Q. 13 Just g i v e . . . (INTER J E C T I O N ) . Sorry. I w a n t to c l a r i f y s o m e t h i n g : your own affairs and they were looked after by? 14 A. 15 35 Q. 16 A. 17 36 Q. 18 A. T h e y s t i l l do. 19 37 Q. T h e y s t i l l do ? 20 A. 21 38 Q. 22 L o u g h r a n & C o m p a n y in Tralee. In T r a l e e ? Yes. Do t h e y c o n t i n u e l o o k i n g a f t e r y o u r a f f a i r s ? Yes. However, this 23 A. 24 39 Q. 25 A. 26 y o u h a d a t a l k w i t h Mr. 29 T ra y n o r 1991 about fund? To c l o s e the account. I w i l l come to that in a m o m e n t ? Right, MR. Sir. O'HALLORAN: 27 28 I was asking you about Ju d g e , I a m s o r r y to interrupt. MR. JUSTICE COSTELLO: Yes. 1 accountants the man 2 K i e r a n Ryan, 3 w h o he u s e d i n D u b l i n . 4 Mr. Loughran. 5 MR. JUSTICE COSTELLO: Yes. 6 MR. 0'HALLORAN: B u t h e c a m e i n 1 9 9 8 to t o w h o m he r e f e r s , was an a c countant He c o n t i n u e s t o u s e 7 Mr. Ki e r a n Rya n to deal 8 with the tax implications. 9 MR. JUSTICE COSTELLO: O f this . 10 MR. O'HALLORAN: O f thi s. MR. JUSTICE COSTELLO: Yes, 11 40 Q. 12 I see. Mr. looking after these? 13 A. 14 41 Q. 15 A. 16 42 Q. 17 A. 18 43 Q. 19 T h a t is r i g h t . These particular? T h a t is r i g h t . Since 1998? T h a t is r i g h t , V e r y well. Sir. I w i l l c o m e in a m o m e n t Mr. F o l e y to what you understood? 20 A. 21 44 Q. Yes. However, f r o m all yo u h a v e l e a r n t since, a n d all 22 t h a t h a s b e e n i n t h e p u b l i c d o m a i n si n c e , 23 w a y t h e s e m o n i e s t h a t w e r e g i v e n t o Mr. 24 d e a l t wi t h , 25 s y s t e m in o t h e r c a s e s t h a t Mr. 26 namely, 27 A. 28 45 Q. 29 R y a n is you, I think, about the Trainer were h ave b ec o m e aware of the Traynor operated, the e s t a b l i s h m e n t of trusts in Cayman? Yes. You are a ware of that? 1 4 6 Q. A r e y o u a w a r e t o o Mr. F o l e y t h a t it w o u l d a p p e a r 2 that the p e r s o n who had the money, 3 I rish client, 4 t h a t s o m e b o d y w a s a p p o i n t e d as S e t t l o r i n t h e 5 Cayman, 6 C a y m a n c o m p a n y o r an a c c o u n t a n t . 7 n o t i c i n g this in the p a p e r s a n d the a c c o u n t of the 8 w a y t h e f u n d s w e r e u s e d b y Mr. 9 10 A. 47 Q . 11 A. 12 48 Q. call h i m the did not even sign the Trust Deed and e i t h e r a r e p r e s e n t a t i v e of Mr. I don't recollect Furze of the Do y o u r e m e m b e r Traynor? it b u t i f y o u s a y it is c o r r e c t . Yes? I a c c e p t it, Sir. A n d that the m o n i e s w ere then t r a n s f e r r e d to the 13 trust company, w h i c h was A n s b a c h e r or G u i n n e s s M a h o n 14 C a y m a n Tr u s t , 15 e s t a b l i s h a c o m p a n y a n d A n s b a c h e r t o o k t h e s h a r e s of 16 the c o m p a n y and o w n e d the c o m p a n y in Cayman, 17 h o l d i n g c o m p a n y t h e n e i t h e r got funds or was l o a n e d 18 funds 19 this in the pape r s ? a n d t h a t t h e p r a c t i c e t h e n w a s to from the trustees. 20 A. Not really, 21 49 Q. Not really? 22 A. 23 50 Q. a nd the Do y o u r e c o l l e c t r e a d i n g Sir. No. A m I c o r r e c t in s a y i n g t h a t y o u d i d n o t k n o w 24 anything that w ould indicate that your funds were 25 t r e a t e d in t h i s w a y ? 26 A. 27 51 Q. 28 29 No, Sir. Y o u h a v e b e e n in t o u c h w i t h the A n s b a c h e r 1 52 Q. 2 A. 3 4 W i t h Mr. Yes, Benjamin? I w r o t e a l e t t e r t o Mr. Benjamin sometime after the Tribunal and the correspondence was returned. 53 Q. What I w o u l d l i k e y o u t o do Mr. 5 solicitor, 6 hi m for all the records? 7 A. 8 54 Q. 9 A. 10 55 Q. 11 A. 12 56 Q. is to w r i t e a g a i n to Mr. Yes. R e l a t i n g to y o u r a r r a n g e m e n t s w i t h And particularly any arrangements, Mr. 57 Q. "Ansbacher"? Yes. 14 16 B e n j a m i n to a s k W h i c h he m i g h t h a v e ? correspondance, A. y o u or y o u r Yes. 13 15 F ol ey , any that he m i g h t h a v e h a d w i t h Traynor? Yes. A n d a l s o w h e t h e r a n y t r u s t w a s e s t a b l i s h e d in 17 r e l a t i o n to t h e f u n d s t h a t y o u h a d g i v e n to 18 Mr. Traynor? 19 A. Certainly, 20 58 Q. 21 A. Certainly, 22 59 Q. V e r y well. Sir. Y o u w i l l do t h a t ? Sir. Perhaps, w e c o u l d j u s t b r i e f l y go 23 through then what occurred. 24 w i t h Mr. 25 O c t o b e r 1979, 26 him, 27 A. 28 60 Q. 29 You had a conversation T r a y n o r in 1 9 7 5 a n d t h e n i n 1979, in you had a further arrangement with as a r e s u l t o f w h i c h y o u g a v e h i m £ 5 0 , 0 0 0 ? T h a t is r i g h t , Sir. Y o u w e r e g o i n g to t e l l m e w h a t h e t o l d y o u w a s g o i n g 1 2 A. 3 Klic Investments. 4 61 Q. 5 A. 6 62 Q. 7 8 Yes. No, D i d h e t e l l y o u w h e r e it w a s e s t a b l i s h e d ? Sir, no. Y o u h a d no idea that y o u r m o n e y was g o i n g into the Cayman company? A. 9 No, Sir. Guinness 10 11 T h a t I w a s g o i n g i n t o a n i n v e s t m e n t g r o u p k n o w n as As I say I was d e a l i n g w i t h & M a h o n at t h a t ti m e . g r a n t e d it w a s t h r o u g h G u i n n e s s 63 Q. Y ou got t hose statements, 12 us i n a p p e n d i x two. 13 the post? 14 A. 15 64 Q. 16 A. 17 65 Q. 18 A. 19 66 Q. T h e y did, yes, W e r e t h e y as a r e s u l t o f a s k i n g f o r t h e m ? T h a t is r i g h t , Sir. W h o d i d y o u ask, Des Traynor, Mr. Foley? Sir. J u s t so t h a t w e u n d e r s t a n d a c t u a l l y w h a t t h e 21 t h e y are d a t e d from 1981? 23 67 Q. 24 t h e s e are s t a t e m e n t s w h i c h yo u got an d Yes. Had you any other statements f r o m Mr. Traynor during t h i s p e r i o d w h i c h y o u m a y h a v e l o s t or d e s t r o y e d ? 25 A. 26 68 Q. 27 A. 28 69 Q. 29 w h i c h h a v e b e e n g i v e n to Sir. p o s i t i o n is, A. & Mahon. Did th e y come to you t hr o u g h 20 22 I t o o k it f o r No, Sir. Are these the only ones you got? T h a t is r i g h t , Sir. Where did you keep these statements? 1 2 A. Yes, 3 71 Q. Yes. 4 Sir. There was w r i t t e n on this the words: "In this name Klic I n v e s t m e n t s L i m i t e d ." 5 6 W h o w r o t e t h a t Mr. 7 A. 8 72 Q. 9 A. 10 73 Q. 11 A. 12 13 74 Q . A. I did, Foley? Sir. W h y did you write those? I w i l l t e l l you. I g o t a h e a r t a t t a c k i n 1987. Yes? A serious heart attack. Yes? A n d sometime after that I was told by 14 P r o f e s s o r B r i a n K e o g h to get m y a f f a i r s in order. 15 So, 16 b u t t h e r e a s o n w a s t h a t if a n y b o d y g o t t h e s e 17 d o c u m e n t s a f t e r me, 18 t h e y w o u l d h a v e t h e i n f o r m a t i o n o n it. 19 75 Q. I w r o t e on t h a t. Yes. Mr. Foley, 20 to an i m portant 21 s w e a r y o u in. 22 A. 23 7 6 Q. 24 A. 25 77 Q. I a m n o t s u r e w h e n I w r o t e it if a n y t h i n g h a d h a p p e n e d t o me, Ms. fact, Cummins has drawn m y attention that I f o r g o t t o a s k h e r to Sorry. Your e v i dence sh o u l d be g iven u nder oath? Sorry. What I p r o p o s e t o do n o w is t o a s k Ms. C u m m i n s to 26 s w e a r y o u a n d t h e n if y o u w o u l d c o n f i r m t h e n t h a t 27 t h e e v i d e n c e y o u h a v e g i v e n us h e r e t o f o r e w a s 28 correct? 29 30 1 2 3 4 5 78 Q. Perhaps, f o r m a l l y t h e n Mr. Foley you w o u l d confirm, 6 n o w u n d e r oath , 7 heretofore given was correct? 8 A. 9 79 Q. Was correct? 10 A. Was correct. 11 80 Q. that the evidence you have I c o n f i r m that the e v i d e n c e I have given. Those s tatements that you have e x h i b i t e d in a p p e n d i x 12 two 13 that you would obtain from a bank? 14 l i k e it? 15 A. No. ( E x h i b i t 1) a r e t h e y n o t t h e s o r t o f s t a t e m e n t s T h e y w o u l d in a c t u a l fact, yes, Do t h e y n o t l o o k but the only 16 t h i n g is t h a t t h e r e w a s n o t h i n g o n top. 17 t a k e n off. 18 81 Q. 19 A. Yes. 20 82 Q. Yes. The top was Was t a k e n off? However, w h a t I a m a s k i n g y o u t o c o m m e n t o n is 21 t h a t it a p p e a r s to b e t h e s o r t of s t a t e m e n t t h a t y o u 22 ob t a i n from a b a n k but w it h the top cut off? 23 A. 24 83 Q. 25 A. 26 84 Q. 27 T h a t is c o r r e c t , F o r e x a m p l e it s h o w s t h e b a l a n c e t h e r e ? Yes. It s h o w s t h e i n t e r e s t t h a t w a s e a r n e d o n t h e balance, 28 A. 29 85 Q. Sir. it s h o w s t h e c r e d i t s a n d t h e d e b i t s ? T h a t is r i g h t , Sir. D i d it n o t o c c u r t o y o u t h a t t h i s w o u l d s e e m to 1 in d icate that your m o n e y was on depo s i t in a b a n k 2 somewhere? 3 I in actual 4 I w a n t e d to k n o w the r e a s o n w h y the tops w e r e t a k e n 5 o ff. 6 86 Q 7 A 8 9 f a c t p h o n e d D e s T r a y n o r w h e n I g o t it. Yes? A n d he s a i d t h a t w a s f o r s e c u r i t y r e a s o n s w h e n t h e y w e r e p o s t i n g t h e m out. 87 Q 10 Yes. However, d i d it n o t o c c u r t o y o u t h a t t h i s a p p e a r e d that the m o n e y was on deposit in a bank? 11 A 12 88 Q T h a t is c o r r e c t , Yes. Sir. Y o u t h e n l a t e r d i s c o v e r e d -- y o u w e r e in t o u c h 13 w i t h Mr. 14 ( E x h i b i t 1) y o u w e r e told , 15 p o s i t i o n on the 3rd M a r c h 1988 was that t h e r e was 16 £82,688. 17 correct? 18 A 19 89 Q 20 A 21 90 Q 22 A 23 91 Q 24 A 25 K e a n e a n d a c c o r d i n g to y o u r s t a t e m e n t y o u n o t e he r e , This was p e r M a r t i n Keane, T h a t is c o r r e c t , 92 Q 27 A 28 93 Q 29 A is t h a t Sir. Is t h a t y o u r w r i t i n g or s o m e b o d y e l s e ' s ? T h a t is m y w r i t i n g , Yes. Who then wrote Sir. "Klic stg£72,893"? T h a t w a s t h e n o t e -- I w i l l j u s t g e t t h a t o u t now. Yes. If y o u l o o k at -- it is a p p e n d i x t h r e e ? T h a t w a s a n o t e -- " K l i c s t g £ 7 2 , 8 9 3 " w a s a n o t e I g o t o f f D e s T r a y n o r ag a i n . 26 that the However, No, is t h a t y o u r w r i t i n g ? t h a t is n o t m y w r i t i n g t h e r e . Who wrote that? 1 94 Q 2 A 3 95 Q 4 A 5 96 Q 6 A 7 97 Q 8 A 9 98 Q 10 A T h a t is c o r r e c t , 11 99 Q This was a note? 12 A T h a t is c o r r e c t , 13 100 Q 14 However, t h e n ...(INTERJECTION)? M y w r i t i n g is u n d e r t h a t a g a i n , "Guinness & Mahon". This was a note you had? Yes . T h e n y o u a d d e d t h e s e t o it l a t e r on? T h a t is r i g h t . Is t h a t it? Yes. I notice Sir. Sir. from your statement ( E x h i b i t 1) t h a t yo u o p e n e d an a c c o u n t in 1986? 15 A 16 101 Q 17 A 18 102 Q 19 A 20 103 Q 21 A 22 104 Q 23 A 24 105 Q 25 26 Yes . T h a t is r i g h t . It w a s t h i s "resident call deposit account"? T h a t is r i g h t , Sir. That was a s t r a i g htforward account? Straightforward, In G u i n n e s s Sir. & Mahon? T h a t is r i g h t , Sir. Y o u g o t s e r i o u s l y il l t h e n ? T h a t is r i g h t . Y o u p u t it i n t o t h e j o i n t n a m e s of y o u r s i s t e r -- of your daughter and yourself? A 27 I w r o t e to G u i n n e s s & M a h o n I t h i n k on the 2 5 t h M a y 1988. 28 106 Q 29 A Yes? A s k i n g t h e m to p u t it i n t o m y d a u g h t e r ' s n a m e e v e n 17 1 2 107 Q 3 A 4 108 Q Yes ? B u t I w a s a d v i s e d to g e t m y a f f a i r s i n or d e r . T h i s t h e n w a s t a k e n ou t o f t h i s a c c o u n t a n d g i v e n to 5 Mr. 6 him? 7 A 8 109 Q 9 A 10 110 Q 11 A F o l e y to a d d to the p r e v i o u s funds you had given Mr? So r r y , Mr. Mr. Traynor? Traynor. To a d d t o t h e p r e v i o u s Yes. Mr. funds you had given him? T r a y n o r p h o n e d m e s o m e t i m e in 1990 a n d he 12 s a i d t h a t t h a t a c c o u n t w a s a w a s t e of t i m e . 13 was no inte r e s t 14 investment 15 111 Q 16 A 17 112 Q 18 A 19 113 Q There in it a n d h e t r a n s f e r r e d it i n t o m y account. Yes? A n d I agreed. You agreed? Yes . That joined the funds that you had a l r e a d y given him? 20 21 A 22 114 Q 23 T h a t is c o r r e c t , Apart Sir. f r o m t h a t Mr. Foley did you add any other funds ? 24 A 25 115 Q 26 A 27 116 Q 28 A 29 117 Q No, Sir. To Mr. No, Traynor? Sir. Yes. I did, W e k n e w Mr. yes, Sir. Foley that you w i t h d r e w funds? 1 2 118 Q . 3 A. 4 1 1 9 Q. 5 A. 6 120 Q. 7 A. 8 121 Q. 9 And £10,000? Yes. I n 1989, £20,000? 1 9 8 9 a n d 1990. I n 1993, £10,000? T h a t is r i g h t , yes, Sir. T h e n y o u w i t h d r e w -- y o u g o t £ 5 0 , 0 0 0 Mr. Collery, 10 A. I n 1995. 11 122 Q. In 1995? 12 A. 13 123 Q. is t h a t n o t r i g h t ? Yes. Yes. C o u l d y o u a s s i s t m e Mr. F oley in e x p l a i n i n g 14 w h y y o u c a m e to t h e c o n c l u s i o n , 15 l e t t e r as y o u d i d t o C a y m a n , 16 m o n e y t h a t w a s t h e n i n y o u r f u n d was, 17 stg£140,000, 18 A. 19 124 Q. 20 A. 21 125 Q. 22 23 from in w r i t i n g your t h a t t h e a m o u n t of I think, is t h a t r i g h t ? That was the figure I got from the Tribunal, Sir. Yes? Approximate Yes. figure. H o w h a d it r e a c h e d t h a t figure? Have you any idea? A. 24 No, Sir, no. T h e f i g u r e w a s g i v e n t o m e at t h e Tribunal. 25 1 2 6 Q. 26 A. 27 127 Q. 28 A. 29 128 Q. However, a f t e r ...(INTERJECTION)? It is i n t e r e s t , I believe, Interest? Yes. A f t e r ... ( I N T E R J E C T I O N ) accumulating. 1 MR. I t h i n k it m i g h t h a v e b e e n 0'HALLORAN: 2 Mr. Collery's. 3 MR. JUSTICE COSTELLO: Sorry? 4 MR. O'HALLORAN: I t h i n k it m i g h t h a v e c o m e from documentation from 5 6 Mr. Collery. 7 MR. JUSTICE COSTELLO: Yes. 8 MR. O'HALLORAN: Yes. MR. JUSTICE COSTELLO: Mr. 9 129 Q C o l l e r y gave the Tribunal documentation. 10 11 H a v e y o u g i v e n us a l l t h e d o c u m e n t a t i o n t h a t t h e 12 T r i b u n a l g a v e y o u Mr. 13 g o t f r o m Mr. 14 A 15 1 30 Q 16 F ol ey , that they might have C o l l e r y or o t h e r w i s e ? I will ask m y solicitor. Yes. MR. Do yo u know? O'HALLORAN: No. 17 We got various folders. Now, this isn't 18 a l l o f it b u t t h e r e m a y be, 19 statements 20 Sandra Kells and other exhibits that wouldn't - ­ 21 t h e y w o u l d n o t a l l h a v e b e e n p r o d u c e d at t h e p u b l i c 22 hearing. 23 MR. JUSTICE COSTELLO: Yes . 24 MR. O'HALLORAN: But c e r t a i n l y t h e y are f r o m Mr. Collery, 26 them. 27 MR. 29 m e m o r a n d u m of t h e s t a t e m e n t of h e r e if y o u w i s h to se e 25 28 say, JUSTICE COSTELLO: I do n o t k n o w Mr. O ' H a l l o r a n if w e s h o u l d - ­ I do n o t w a n t t o e x p r e s s a n y o p i n i o n o n it as of 1 now. 2 d o c u m e n t s t h a t w e r e g i v e n to Mr. 3 MR. 0 ' H A L L O R A N : Yes . 4 MR. J U S T I C E C O S T E L L O : By the Tribunal. 5 MR. O ' H A L L O R A N : Yes . 6 MR. J U S T I C E C O S T E L L O : We do not n e e d all the A s o f n o w I do n o t t h i n k w e n e e d a l l t h e 7 Foley. d o c u m e n t s b e c a u s e some of 8 t h e m m a y or m a y not be c o n f i d e n t i a l . 9 t o e x p r e s s a n y v i e w o n it. I do not want What I w o u l d be v ery 10 a n x i o u s h o w e v e r is t h a t a n y d o c u m e n t s r e l a t i n g to 11 his own af f a i r s w h i c h he m a y have obtained, 12 t h e T r i b u n a l m a y h a v e o b t a i n e d f r o m Mr. 13 r e l a t i n g to h i s o w n a f f a i r s , 14 us . 15 MR. O'HALLORAN: 16 which Collery, b e m a d e a v a i l a b l e to I think I w o u l d say that t h e y w e r e p r o d u c e d to h i m 17 i n e v i d e n c e a n d t h e y w o u l d b e p a r t of t h e e x h i b i t s 18 that I han d e d over this morning. 19 MR. JUSTICE COSTELLO: I see. 20 MR. O'HALLORAN: T h e y are the ex h i bi t s that 21 w e r e r e f e r r e d t o in t h e 22 evidence. 23 MR. JUSTICE COSTELLO: In t h e e v i d e n c e , 24 MR. O'HALLORAN: At the Tribunal. 25 MR. JUSTICE COSTELLO: Yes, yes. 26 MR. O'HALLORAN: I think my instructions 27 28 29 f r o m Mr. yes. F o l e y a r e to c o o p e r a t e w i t h you in e v e r y respect. 1 2 objection. You can take 3 t h e m t o l o o k at t h e m a n d if y o u w a n t t o g i v e t h e m 4 b a c k to m e o r w h a t e v e r . 5 MR. JUSTICE COSTELLO: T h a n k you. We will c o n s i d e r t ha t . 6 7 MR. O'HALLORAN: Yes . 8 MR. JUSTICE COSTELLO: You s e e . . . (INTERJECTION). 9 MR. O'HALLORAN: In f a c t I t h i n k I h a v e 10 t h e m all except the folder 11 I d i d n o t b r i n g w i t h me, 12 t h e C e n t r a l H o t e l in B a l l y b u n n i o n . 13 MR. JUSTICE COSTELLO: Yes. 14 MR. O'HALLORAN: T here was a no t h e r folder. 15 MR. JUSTICE COSTELLO: Yes. 16 MR. O'HALLORAN: I think that folder and w h i c h w a s i n r e l a t i o n to 17 t h e f o l d e r r e l a t i n g to 18 T h e C e n t r a l H o t e l in B a l l y b u n n i o n w o u l d p r o b a b l y 19 a p p r o x i m a t e to all the d o c u m e n t s t h a t the T r i b u n a l 20 have given u s . 21 131 Q MR. JUSTICE COSTELLO: 22 I see. V e r y well. y o u Mr. O'Halloran. Thank After 23 Mr. Traynor's death you must have been concerned, 24 Mr. Foley? 25 A 26 132 Q 27 A 28 133 Q 29 A I was certainly, Y o u c o n t a c t e d Mr. Sir. I was very concerned. Collery? I e v e n t u a l l y g o t Mr. Collery. D i d he not tell you h o w m u c h m o n e y yo u h a d t h en? 1 134 Q 2 A 3 135 Q 4 A 5 136 Q 6 A 7 8 I d i d not. Is t h a t n o t What strange? I ... ( I N T E R J E C T I O N ) . Very strange? I w o u l d accept that but what I w a s a n x i o u s at t h a t t i m e w a s to g e t o u t £ 5 0 , 0 0 0 . 137 Q 9 10 No, H a d yo u an y p a r t i c u l a r r e a s o n for w a n t i n g £ 5 0 , 0 0 0 then? A Well, f i r s t o f a l l I w a s h o l d i n g -- it w a s m y 11 i n t e n t i o n to h o l d t h a t £ 5 0 , 0 0 0 a n d p a y it o n a c c o u n t 12 to the Reve n u e C o m m i s s i o n e r s and fu r t h e r m o r e that 13 £50,000 plus the £30,000 14 o u t . . . (INTERJECTION). 15 138 Q 16 A 17 Was what? I h a d £ 3 0 , 0 0 0 t a k e n ou t p r e v i o u s l y a n d t h a t £ 5 0 , 0 0 0 was £80,000. 18 139 Q 19 A 20 21 I had taken W e l l . . . (INTERJECTION)? A n d t h a t in a c t u a l fact was just over m y total investment. 140 Q Is t h a t w h a t y o u w e r e d o i n g t h e n ? You thought you 22 were getting back your total investment, 23 Well, 24 a n d as I s a y I -- w h e n I p h o n e d Mr. 25 h i m I w a n t e d to get £50,000. 26 a l a r g e s u m o f m o n e y , " a n d h e i n d i c a t e d t o m e at 27 t h a t t i m e I t h i n k t h a t it w a s a Mr. 28 d e a l i n g w i t h it a n d I said, 29 h e a r d o r d e a l t w i t h Mr. did you? I w a s c o n c e r n e d a b o u t t h e m o n e y at t h e t i m e Collery I told H e t o l d me, " T h i s is John Furze "I n e v e r k n e w Mr. Furze". F ur ze , 1 141 Q. 2 was in two a c counts? 3 A. 4 142 Q. 5 A. No. No, Sir. Y ou know n ow that your m o n e y was in two acc o u n ts ? I know now from the Tribunal 143 Q. 8 Yes. It d o e s a p p e a r t h a t t h e r e w a s o n e a c c o u n t "A/A49", 9 A. 10 144 Q. 11 A. 12 145 Q. 13 A. 14 1 4 6 Q. 15 A. Yes, is t h a t n o t r i g h t ? Sir. The o ther ac c o u n t was Can you explain how the mo n e y . . . ( I N T E R J E C T I O N ) ? I understand...(INTERJECTION). Was in two a c c o un t s ? I u n d e r s t a n d that the s e c o n d a c c o u n t was m a d e up of the £24,000, 17 call account. 18 147 Q. 19 A. 20 148 Q. Yes? A n d that first nu m b e r there r e l a t e d to the original The "A/A49", you think, might have been the resident a c c o u n t b e c a u s e it w a s i n 1993, 23 A. 24 1 4 9 Q. 25 T h a t is r i g h t , it w a s £ 2 8 , 0 0 0 ? Sir. Y o u t h i n k t h a t is t h e f u n d s t h a t y o u t r a n s f e r r e d from your account? 26 A. 27 150 Q. 29 w h i c h was t r a n s f e r r e d from the resident in v e s t m e n t of £50,000. 22 28 "A/A40"? Y e s Sir. 16 21 it w a s i n t w o a c c o u n t s , Sir. 6 7 I am just w o n d e r i n g d id he tell you that the m o n e y T h a t is w h a t Yes. I assume, Sir, yes. The o t h er m o n e y t hen was the o r i g in a l m o n e y t h a t y o u p u t in? 1 151 Q. 2 3 A. 4 152 Q. 5 Yes. If t h a t is so t h e o r i g i n a l m o n e y , fund, in 1996 h a d r i s e n to £ 9 1 , 0 0 0 ? Yes. E v e n t h o u g h you h a d m a d e these, A. 7 153 Q. C a n y o u e x p l a i n h o w t h a t is so? 8 A. I u n d e r s t a n d that was interest. 9 154 Q. 10 A. 11 155 Q. 12 A. 13 1 5 6 Q. T h a t is r i g h t , Sir. Yes? I infer that that was interest. Y o u t h i n k it w a s i n t e r e s t ? Yes, Sir. H a v e y o u a s k e d Mr. C o l l e r y w h e t h e r he h a s a n y o t h e r 14 r e c o r d s r e l a t i n g to t h e d e p o s i t , 15 "A/A40", 16 b e f o r e that in G u i n n e s s 17 s t a t e m e n t s in r e l a t i o n to t h at? 18 A. 19 157 Q. 20 A. 21 158 Q. 22 A. 23 1 5 9 Q. 24 the account w h i c h w o u l d h a v e b e e n in IIB a n d t h e n & Mahon Ireland? Has he any I d i d n ' t s p e a k t o him. Yes? W h e n I a s k e d Mr. C o l l e r y for statements. Yes? I e v e n t u a l l y g o t t h e s t a t e m e n t s o f M a y 1999. A r e t h e s e the ones that we are r e f e r r i n g to n o w or are t hese other ones? 25 A. 26 160 Q. 27 A. 29 t a k e n o u t th e s e , funds that we h ave ta l k e d about? 6 28 the original T h e y are, Sir. Have a l ook t here a nd see? Yes. MR. O'HALLORAN: The y w o u l d be the ones headed "Ansbacher" towards 1 2 3 MR. 4 Yes. 5 161 Q MR. 0'HALLORAN: Yes. A p p e n d i x is ri g h t . JUSTICE COSTELLO: A p p e n d i x five are the 6 do c uments you got from 7 Mr. 8 A 9 162 Q C o l l e r y in M a y ? T h a t is r i g h t , Sir. Wha t were the d o cuments you got from the Tribunal? 10 W e r e t h e r e an y s t a t e m e n t s in r e l a t i o n to your 11 account o b t a i n e d b y the Tribunal? 12 A I give...(INTERJECTION). 13 MR. O'HALLORAN: No, 14 No, Sir, 15 T r i b u n a l as f a r as I c a n r e m e m b e r . 16 say, 17 Tribunal; 18 MR. on the advice. Sir, We got t h e m b a c k from the I w o u l d l i k e to that e v e r y t h i n g I h a d I gave to the I got b a c k that documentation. JUSTICE COSTELLO: Yes. W e l l . . . (INTERJECTION). 19 20 no. MR. O'HALLORAN: Ju d g e , 21 I t h i n k it m i g h t b e as w e l l t o c l a r i f y th a t . 22 J u s t m y r e c o l l e c t i o n is t h a t 23 he g o t a n y t h i n g f r o m C o l l e r y at t h a t t i m e a n d t h a t 24 t h o s e a r e t h e -- t h i s 25 Tribunal but 26 MR. I a m n o t so s u r e t h a t is w h a t h e g o t f r o m t h e I w o u l d j u s t l i k e t o c l a r i f y that . JUSTICE COSTELLO: 27 W o u l d y o u c l a r i f y it b e c a u s e it c o u l d be 28 important. 29 f r o m Mr. I w o u l d like to k n o w w h i c h was o b t a i n e d Collery. Ms. M a c k e y d r a w s m y a t t e n t i o n to 1 2 at p a g e 7 o f y o u r s t a t e m e n t . 3 f r o m t h e t o p at p a g e 7: 4 It is t h e f i f t h l i n e " S o m e t i m e l a t e r in M a y 1999 I r e c e i v e d b y p o s t at m y h o m e a d d r e s s . .." 5 6 A. 7 163 Q. T h a t is r i g h t . " ...a seri e s of b a n k s t a t e m e n t s . . . " 8 9 A. 10 164 Q. T h a t is r i g h t , Sir. "...bearing the names "Hamilton Ross"." 11 "Ansbacher" and 12 13 A. 14 15 165 Q. T h a t is r i g h t , Sir. MR. O'HALLORAN: So r r y , MR. JUSTICE COSTELLO: A n d the stat e m e nt s 16 a ppe n d i x five? A. 19 20 166 Q. T h a t is r i g h t , Sir. MR. O'HALLORAN: Yes . MR. JUSTICE COSTELLO: V e r y well then. 21 get any statements, 23 T r i b u n a l o r is t h a t n o t : i g h t ? 24 MR. bank statements, O'HALLORAN: 25 No, t h r o u g h the I think there were -­ there was some more 26 detail. 27 MR. 29 T h e n it l o o k s as i f y o u d i d n o t 22 28 T h a t is it. c o n c e r n e d a nd t h e y are 17 18 Judge. JUSTICE COSTELLO: That came from the Tribunal. 1 -- I t h i n k s o m e of t h e 2 internal workings 3 MR. JUSTICE COSTELLO: R e l a t i n g to this account? 4 MR. O'HALLORAN: Yes. 5 MR. JUSTICE COSTELLO: Yes. c a m e to u s f r o m t h e T r i b u n a l . I t h i n k w e h a v e it then. 6 7 Mr. 8 a n d t h a t is T h e C e n t r a l H o l d i n g ? 9 A 10 168 Q 11 A 12 169 Q 13 A 14 170 Q 15 A 16 171 Q 17 A 18 172 Q 19 A 20 F ol ey, Yes, t h a n k you. I j u s t w a n t to t u r n n o w t o a n o t h e r t o p i c Central Tourist Holding, Sir. Central Tourist Holding Limited? Yes . T h i s c o m p a n y o w n e d t h e h o t e l in B a l l y b u n n i o n ? The O l d C e n t r a l H o t e l in B a l l y b u n n i o n . Yes. You w ere a D i r ec t o r of that co mpany? T h a t is r i g h t , Sir. D i d y o u h a v e a n y r o l e i n t h e r u n n i n g of t h e c o m p a n y ? I did, yes, Sir. Y ou were the lic e n se e of the company? Yes. Well, t h e r e w e r e f o u r in 1972. C a n I j u s t go back and relate? 21 173 Q 22 A Yes? In 1 9 7 2 Mr. B i l l y C l i f f o r d came to me and said that 23 the D i r e ct o r s of The Brandon, 24 Tom Clifford and Billy Clifford, 25 purch a s i n g The Old Central 26 174 Q 27 A w h o w e r e J o h n By r n e , w e r e i n t e r e s t e d in In B a l l y b u n n i o n . Yes? A n d t hey a s k e d me w o u l d I be i n t e r e s t e d in coming 28 in. 29 said £5,000 approximately. I a s k e d t h e m w h a t it w o u l d c o s t m e a n d t h e y E a c h of t h e D i r e c t o r s 1 w o u l d b e p u t t i n g t h a t up. 2 b e c a m e a D i r e c t o r f o l l o w i n g t h a t -- 3 loan t aken out from G u i nness 4 approxi m a t e l y £70,000. 5 175 Q. 6 A. 7 1 7 6 Q. 8 T h a t w a s i n 1972 . So, I that was a & M a h o n fo r Yes? I w a s n ' t i n v o l v e d i n n e g o t i a t i n g t h a t loan . Yes. Did you run the hotel or was there s o m ebody else running the hotel? 9 A. 10 177 Q. 11 A. 12 178 Q. 13 A. 14 1 7 9 Q. 15 A. No, there was a manager. Right? F r o m 197 6 o n w a r d s I b e c a m e v e r y m u c h i n v o l v e d i n it. In r u n n i n g the h o t e l ? I n r u n n i n g it. Yes? L i k e w h e n I s a y I b e c a m e v e r y m u c h i n v o l v e d I w a s in 16 o v e r at t h e h o t e l m o s t w e e k e n d s . 17 m a n a g e r there. 18 180 Q. 19 A. 20 181 Q. 21 A. 22 182 Q. Were you a signatory, There was a a bank signatory? I w a s o n e o f four. O n e of f o u r ? Yes. D i d you, i n fact, t h e n h e l p to l o o k a f t e r t h e 23 f i n a n c i a l a f f a i r s o f t h e e n t e r p r i s e or d i d s o m e b o d y 24 else do that? 25 A. F i r s t of a l l S i r t h e y a s k e d m e t o b e c o m e t h e 26 licence holder because the other two local 27 Directors, 28 already licence holders 29 Tralee. Billy Clifford and Tom Clifford, So, were for two other p r e m i s e s I was getting the statements from in 1 2 183 Q. 3 A. 4 184 Q. 5 A. 6 185 Q. 7 8 D i d y o u h a v e a b a n k a c c o u n t as w e l l ? Ban k Of Ireland, Ballybunnion. The B a n k Of Ir e l a n d in B a l l y b u n n i o n ? Ballybunnion. Yes. T h e h o t e l w a s s o l d in 1986. A. I t h i n k t h e h o t e l a n d b a l l r o o m w a s sold, 1 8 6 Q. 11 A. 12 187 Q. 13 A. 14 188 Q. 15 A. 16 Yes? I a m o p e n to c o r r e c t i o n t h e r e . Yes? B u t as f a r as I c a n r e c o l l e c t . Yes? Just to be h o n e st I t h i n k it w a s l a t e 1 9 8 6 / 1 9 8 7 before the sale was finalised. 1 8 9 Q. 18 Yes. Who were the solicitors who were acting... (INTERJECTION)? 19 A. Grace & Company. 20 190 Q. Grace & Company? 21 A. 22 191 Q. 23 Yes. Are t h e y ...(INTERJECTION)? MR. O'HALLORAN: No, 24 t h e y a r e n o l o n g e r in existence? 25 A. 26 192 Q. T h e y a r e no l o n g e r i n e x i s t e n c e . MR. JUSTICE COSTELLO: 27 29 I th i n k , for £ 1 7 7,000 totally. 10 28 Do y o u r e m e m b e r what you got for the hotel? 9 17 Yes. Were they local solicitors ? A. Local solicitors in Tralee. 1 2 3 a s k y o u h o w it c a m e a b o u t 4 t h a t y o u s i g n e d t h i s c h e q u e o f t h e 2 0 t h O c t o b e r 1 987 5 for £42,580? 6 A 7 T h a t is r i g h t , October, 8 194 Q 9 A 10 A s f a r as I c a n r e c o l l e c t 195 Q 12 A Mr. Grace. 13 196 Q Mr. Grace, 14 A 17 18 Grace. yes? A n d t h a t w a s p a i d e i t h e r to H a u g h e y B o l a n d or & Mahon. W h y was the c h e q u e on an a c c o u n t o p e n e d b y Mr. A Mr. I was a s k e d b y the Who? Guinness 197 Q T h a t w a s in Yes? 11 16 I was asked. yes. solicitor, 15 Sir. Grace? Sorry, s or r y . W h e n t h e s a l e w a s s o l d it w a s a f t e r 19 t h e s u m m e r s e a s o n a n d h e o p e n e d a n a c c o u n t in t h e 20 B a n k O f I r e l a n d in L i s t o w e l . 21 198 Q 22 A W h y d i d h e do t h a t ? B e c a u s e he pu t all the funds in there. I don't 23 b e c a u s e it w a s e a s i e r f o r h i m I w o u l d s a y t o 24 transaction business with Listowel. 25 199 Q 26 A W h y w a s t h a t Mr. Foley? I am not sure but maybe Ballybunnion, 27 c o r r e c t i o n h e r e again, 28 s t a g e now. 29 20 0 Q Yes? know I a m o p e n to m a y h a v e b e e n c l o s e d at t h a t 1 It m a y or m a y n o t b u t I k n o w t h e w h o l e a c c o u n t w a s 2 t r a n s f e r r e d to Listowel. 3 MR. O'HALLORAN: My recollection, 4 n a m e of the company, 6 Ballybunnion. 7 MR. JUSTICE COSTELLO: 8 n o t t h e s o l i c i t o r ' s name , Yes. 20 1 Q MR. O'HALLORAN: Yes. MR. JUSTICE COSTELLO: I am just w o n d e r i n g why 12 t h e c h e q u e w a s d r a w n then, 13 the B a n k Of Ir e l a n d in L i s t o we l ? A 15 I u n d e r s t o o d the cheque was d r a w n to p a y off the creditors. 16 202 Q 17 A 18 19 20 3 Q 20 A 21 204 Q Sorry? I u n d e r s t o o d that cheque was p a i d to p a y off Guinness & Mahon. Guinness & Mahon? Yes . However, what I a m a s k i n g y o u is w h y it w a s d r a w n , 22 do y o u know, 23 r a t h e r t h a n in B a l l y b u n n i o n ? A 25 in t h e B a n k O f I r e l a n d i n L i s t o w e l B e c a u s e t h e f u n d s -- w h e n t h e s a l e w a s c l o s e d h e l o d g e d t h e p r o c e e d s of t h e s a l e i n t o L i s t o w e l . 26 20 5 Q 27 A I see? B e c a u s e at t h a t stage we d id owe m o n e y to the b a n k in B a l l y b u n n i o n . 28 29 T h a t is w h a t I if I g a v e t h e w r o n g i m p r e s s i o n . 10 24 in u nderstood and I am sorry 9 14 is t h a t it w a s l o d g e d in t h e 5 11 Ju d g e , 206 Q Yes. I t h i n k y o u k n o w n o w t h a t it w a s u s e d to p u t 32 1 into an a ccount e n t i t l e d "The A m i e n s 2 You know that now? 3 T h a t w a s b r o u g h t to m y n o t i c e at t h e T r i b u n a l , 4 207 Q 5 A 6 208 Q 7 A 8 209 Q 10 A 11 Sir. You di d not know a n y thing about that? No, Sir. T h e m o n e y was, Yes, Sir. i n fact, pa i d into this account? C o u l d I p o i n t o u t at t h a t s t a g e J u d g e if Yes ? L a t e M a y / e a r l y J u n e I g o t a s e r i o u s h e a r t a t t a c k in 19 87 a n d I w a s o u t o f a c t i o n f o r a n u m b e r o f m o n t h s . 12 21 0 Q 13 A 14 Yes ? A n d I h a d o n l y j u s t c o m e b a c k t o -- a r o u n d t h a t time. 21 1 Q Yes. I w ould say maybe late August. D i d y o u k n o w w h e t h e r o r n o t t h e loan , 16 had obtained from Guinness 17 claimed, 18 A 19 212 Q 20 A 21 21 3 Q 22 23 2 A/C". you allow me? 9 15 S / L No. No, the company h a d b e e n b a c k e d b y a c a s h d e p o s i t or n o t ? Sir. You did not know about that? No knowledge whatsoever, The d o c u m e n t s guarantee, A & Mahon, that you Sir. s h o w it w a s -- s e c u r i t y w a s a a personal guarantee? Personal g u a rantee b y the four Directors and that 24 c a u s e d m e a lo t o f p r o b l e m s . 25 h eart a t t a c k I got b e c a u s e 26 substantial money. 27 However, 28 g u a r a n t e e o r t h e l o a n t h a t w a s d u e b y t h e c o m p a n y to 29 Guinness I b l a m e d that for the I c o u l d se e m y s e l f p a y i n g did you know that either your personal & Mahon, was b a c k e d b y a cash deposit? 1 2 21 5 Q 3 A 4 216 Q No, Sir. I see. Mr. Foley, I h a v e n o t v e r y m u c h m o r e t o ask. 5 However, 6 a c u p o f c o f f e e f o r t e n m i n u t e s o r so? 7 A 8 217 Q 9 A w e c o u l d s t o p now. W e c o u l d b r e a k n o w fo r I w o u l d a p p r e c i a t e that. A n d we w i l l c o m e b a c k ? T h a n k you v e r y much. 10 11 SHORT ADJOURNMENT 12 13 218 Q MR. JUSTICE COSTELLO: 14 something clarified, 15 Mr. 16 A 17 219 Q 18 19 F ol e y . You had correspondence with Cayman? Yes . A n d yo u w r o t e to H a m i l t o n Ross a n d yo u h a v e not yet w r i t t e n to A n s b a c h e r , A is t h a t t h e p o s i t i o n ? T h a t is. MR. 20 O'HALLORAN: 21 T h e y are the on l y two letters we have w r i t t e n 22 23 I just w a n t to get Judge. 22 0 Q MR. JUSTICE COSTELLO: 24 Yes. What I w a n t to j u s t m a k e c l e a r is t h a t w e 25 r e q u i r e y o u n o w is to w r i t e t o A n s b a c h e r t o o b t a i n 26 their records? 27 A 28 22 1 Q 29 A Right, Sir. G o i n g b a c k to 1972? 1 222 Q 2 Because they are the people that origi n a l l y would have been dealing with your funds? 3 A 4 22 3 Q Yes . V e r y well. 5 However, 6 ask you? 7 A Ms. Mr. F ol ey , t h a t is a l l I w i s h t o ask. M a c k e y has a few q u e s t i on s Yes . 8 E N D O F E X A M I N A T I O N O F MR. 9 MR. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 s h e w a n t s to JUSTICE COSTELLO DENNIS F OLEY BY 1 2 M S . MACKEY 3 4 MS. MACKEY: Mr. 5 Fo ley , this will not really take a moment. 6 is j u s t to f i n i s h u p o n t h e a f f a i r s of C e n t r a l 7 Tourist Holdings? 8 A 9 22 5 Q It Yes . Y o u t o l d us b e f o r e the b r e a k t h e r e t h a t yo u are 10 a w a r e n o w f r o m i n f o r m a t i o n t h a t y o u r e c e i v e d at t h e 11 M o r iarty Tribunal, 12 there, 13 s e c u r e d o n a d e p o s i t in A n s b a c h e r , 14 correct? 15 A 16 226 Q 17 A 18 227 Q 19 A from some documents that you saw t h a t t h e l o a n to C e n t r a l T o u r i s t H o l d i n g s w a s is t h a t n o t T h a t is c o r r e c t . You know that now? T h a t w a s b r o u g h t to m y n o t i c e at t h e T r i b u n a l . At the Trib u n a l ? A n d I i n f o r m e d t h e T r i b u n a l h a d I k n o w n t h a t at t h e 20 time I probably wouldn't have had a serious heart 21 attack. 22 228 Q 23 A 24 Yes? Because I was s t i l l g e t t i n g s t a t e m e n t s r i g h t u p to t h e c l o s e of t h e s a l e s h o w i n g s u b s t a n t i a l m o n e y due. 25 229 Q 26 A 27 23 0 Q T h a t is r i g h t . I under s t a n d that? Yes . Is it c o r r e c t a l s o to s a y t h a t y o u w e r e m a d e a w a r e 28 at t h e T r i b u n a l tha t, 29 by monies paid from Ansbacher? i n fact, the l oan was c l e a r e d 1 2 23 1 Q 3 A 4 232 Q 5 A 6 7 T h a t is c o r r e c t ? Yes. I u n d e r s t o o d t h a t w a s p a i d o f f i n 1985. 1985? T h a t is w h a t I under s t o o d and I was s t a t e m e n t s r i g h t u p t o 1987. 23 3 Q 8 Is it t h e c a s e t h a t t h e c h e q u e t h a t y o u w e r e t e l l i n g us a b o u t b e f o r e t h e b r e a k ? 9 A 10 234 Q 11 Yes . W h i c h w a s d r a w n o n t h e a c c o u n t o f t h e c o m p a n y in Listowel, Bank Of Ireland? 12 A T h a t is r i g h t . 13 23 5 Q Sign e d by you? 14 A 15 236 Q 16 Yes . T h a t y o u r u n d e r s t a n d i n g o f t h a t w a s t h a t it w a s g oing to m a k e a s ettlement wit h Guinn e s s 17 A 18 237 Q T h a t is w h a t & Mahon? I understood. In r e s p e c t o f t h i s loan, is t h a t w h a t y o u a r e saying? 19 20 still getting A I had -- yes, i n r e s p e c t o f t h i s l o a n b e c a u s e it 21 was showing £ 1 3 5,000 but 22 had pa i d substantial interest over the years and 23 that we p a i d b a c k m o re t han d ouble the £70,000. 24 238 Q 25 A 26 239 Q 27 Yes ? A n d I f e l t w e w e r e e n t i t l e d to a s e t t l e m e n t . Just r e m i n d me of the date of w h e n you w r o t e that cheque again? 28 A 29 24 0 Q I h a d m a d e t h e c a s e t h a t we October, w a s it, O c tober 1987? 1987? 1 I c a n j u s t c h e c k t h a t n ow . 2 memory. 3 24 1 Q 4 A 5 242 Q 6 A 7 24 3 Q 8 A 9 Yes. O c tober 1987? 2 0 t h O c t o b e r 1987. In fact, the loan h a d b e e n c l e a r e d in 1985? T h a t is w h a t I u n d e r s t o o d f rom the Tribunal. Y o u h a d n o t r e c e i v e d a n y n o t i c e of t h a t ? N o k n o w l e d g e o f it. 244 Q 11 A 12 You were getting statements From Guinness from Guinness & Mahon? & M a h o n s h o w i n g in e x c e s s o f £ 1 3 5 , 0 0 0 due . 13 24 5 Q R i g h t u p to 1 9 8 7 ? 14 A R i g h t u p to 1987, 15 246 Q Mr. 17 loan was p a i d off? 18 A 19 247 Q u p to t h e c l o s e of t h e sale. Since your e v i d e n c e to the M o r i a r t y Tribunal 16 Foley have you learned any more about how that No. H a v e y o u e n q u i r e d f r o m Mr. C o l l e r y about this matter? 20 21 A 22 248 Q 23 A 24 249 Q 25 A 26 No, I haven't You have not No, s p o k e n to Mr. s p o k e n t o Mr. Collery. Collery? no. W h e n w a s t h e l a s t t i m e y o u s p o k e t o Mr. 19 98 as f a r as I c a n r e m e m b e r . 1 998 Collery? I m e t h i m at Dublin A i r p o r t . 25 0 Q T h a t is r i g h t . W a s t h a t p r i o r to y o u r l e a r n i n g a n y t h i n g about the loan h a v i n g b e e n p a i d off? 28 29 I was still getting statements s h o w i n g i n e x c e s s o f £ 1 3 5 , 0 0 0 due. 10 27 I am speaking from A 1 25 1 Q. Yes. The first that you knew about this loan b e i n g 2 p a i d o f f w a s w h e n y o u w e r e so i n f o r m e d b y t h e 3 Moriarty Tribunal? 4 A. 5 252 Q. 6 V e r y w e l l t h e n. h a v e f o r you, 7 A. 8 25 3 Q. 9 M y r e c e n t v i s i t to t h e T r i b u n a l . Those are the all the q u e s ti o n s Mr. I Foley? Thank you very much. T h a n k s Ms. M a c k e y . T h a n k you. E N D O F E X A M I N A T I O N O F MR. D E N N I S F O L E Y B Y MS. MR. V e r y w e l l Mr. MACKEY 10 11 JUSTICE COSTELLO: 12 Foley. Your e v i d e n c e w i l l be 13 t r a n s c r i b e d a n d w e w o u l d a s k y o u t h e n t o c o m e u p to 14 s i g n t h e t r a n s c r i p t as s o o n as it is r e a d y ? 15 Yes . 16 MR. O'HALLORAN: 17 J u d g e j u s t so t h a t -- in r e l a t i o n t o t h e l e t t e r to 18 Ansbacher. 19 MR. JUSTICE COSTELLO: Yes . 20 MR. O'HALLORAN: T here se e m e d to be a 21 c e r t a i n a m o u n t of 22 c o n f u s i o n as t o w h e r e we s h o u l d w r i t e . 23 MR. JUSTICE COSTELLO: Yes . 24 MR. O'HALLORAN: T h a t is w h y w e w r o t e to 25 the peo p l e that we wrote 26 t o th e r e , 27 a d d r e s s t h a t y o u w o u l d 1: ke m e to a d d r e s s t h e 28 c o r r e s p o n d e n c e to? 29 H a m i l t o n Ross , C o u l d you tell me the 1 2 writing. 3 MR. O'HALLORAN: I c a n g e t tha t . 4 MR. JUSTICE COSTELLO: It is h e r e i n th i s . 5 h e r e in the appendix, 6 l e t t e r f r o m " A n s b a c h e r " to H a m i l t o n R os s . 7 MR. O'HALLORAN: 8 9 the In f a c t w e w e r e w r i t i n g in r e l a t i o n to funds. I t h i n k t h e e v i d e n c e w a s t h a t it h a d b e e n t r a n s f e r r e d 10 to H a m i l t o n Ross . 11 MS. MACKEY: Yes. 12 MR. O'HALLORAN: Yes, 13 14 It is c e r t a i n l y w e w i l l do that. MR. JUSTICE COSTELLO: 15 Y o u see, as y o u p r o b a b l y k n o w Mr. O ' H a l l o r a n that 16 all the funds that w o u l d h ave b e e n o r i g i n a l l y g iven 17 b y Mr. F o l e y w o u l d h a v e b e e n u n d e r t h e c o n t r o l of 18 th i s. T h e y w o u l d have been, 19 deposited with the company Guinness Mahon Cayman 20 Trust in Cayman. 21 MR. O'HALLORAN: Yes. 22 MR. JUSTICE COSTELLO: It is n o w k n o w n as 23 a p p a r e n t l y at a n y rate, Ansbacher. 24 MR. O'HALLORAN: Yes. 25 MR. JUSTICE COSTELLO: What 26 I w o u l d b e a n x i o u s to o b t a i n is a n y d o c u m e n t s 27 r e l a t i n g to t h e c i r c u m s t a n c e s 28 o r i g i n a l l y c a m e a b o u t a n d w h e t h e r or n o t a t r u s t w a s 29 e s t a b l i s h e d a n d A n s b a c h e r w o u l d b e t h e p e o p l e to in w h i c h this 1 2 MR. 3 JUSTICE COSTELLO: for today. 4 5 6 V e r y w e l l t h e n t h a t is al l A. T h a n k you v e r y m u c h Judge. MR. O'HALLORAN: T h a n k y o u Ms. T h a n k you. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 T h a n k you. THE E X A M I N A T I O N WAS THEN C O N CLUDED Mackey. Numb CHMM sCLinalkoP \7 .1000 .Appendixixvu?mqnm' :3 S T A T E M E N T O F D E N I S F O L E Y T.D. T O T H E INSPECTORS APPOINTED B Y O R D E R O F T H E HIGH C O U R T T O A N S B A C H E R ( C A Y M A N ) LIMITED Thomaa J. O'Hallonm Solicitors Upper Ash* Street Tralee County Karry iKTRggugnPN 1. 1 make this unsworn statement In response to a request by the Inspectors appointed by Order of the High Court to Ansbacher (Cayman) Limited (the ‘Inspectors*). If the Inspectors have any queries arising out of this unsworn statement both I and my Solicitorwould be happyto respond to queries. 2 .1am a member of Dali Eireann for the constituency of North Kerry. I first 8tood as a candidate for the Flarma Fall party In that constituency in (he 1977. General Election. I was unsuccessful in that election. I stood again in the General Election in 1681 and was elected for the first time at that election. Apart from a period between 1989 and 1992 when I was a member of Seanad Eireann, I have been a member of Dali Eireann since the date of my election In 1981 to the present time. I am also a member of Kerry County Council having been elected to the Council for the first time In 1879. 3. In 19591 joined Tralee U.D.C. as a Revenue Colector. Initially, I was Involved In the collection of rents. In or about 1967 I was appointed Rate Collector for the town of Tralee. I continued In this position until myelection as a T.D. In 1981. INVOLVEMENTWITHGUINNESS 1 MAHON flRELAMtt LIMITED AND/OR DESMONDTRAYNOR 4. In 19651was asked by one of the directors of the Mount Brandon HotBl In Tralee, which was in the course of construction at the time, to assist in obtaining bands to play In the Hotel's ballroom. I was also asked to give some assistance In arranging publicity for the new ballroom. As part of my arrangement with the Mount Brandon Hotel I would receive payment from both the ballroom and from the bands themselves. I was also asked to book bands for the ballroom for the Central Hotel in Ballybunion. The Central and Mount Brandon ballrooms were successful for a period and I succeeded in obtaining all the top bands In the country during this period. I terminated my arrangement with the Mount Brandon when I became a member of Dail Eireann in 19B1.1 was also a director of the company which owned the Central Hotel, Central Tourist Holdings Limited ("CTH"). I also invested the sum of IRES,000 in this business. My Involvement In CTH came to an end In 1987 when I contributed fund# totalling IR£7,787.58 towards the discharge of creditors of that company. 5.1 first met Desmond Traynor (*Mr. Traynor") at the time of my Involvement with the Mount Brandon Hotel In the 1960's. Mr. Traynor used to visit the Hotel In his capacity as an accountantwith the firm of Haughey Boland whom I befleve dd the accounts for the Hotel. I can recall on one occasion discussing with Mr. Traynor my Involvement with the Hotel and in particular my role In booking bands for the ballroom in the Hotel. I befleve that Mr. Traynor visited the Hotel once or twice a ^ year. Some time In the mld-1970's (I believe It was in 1975 or 1976 although i cannot be certain) Mr. Traynor asked me about my financial position. He Informed me that through his bank, Guinness & Mahon In Dublin, he would be able to get me a good return on any funds which I might have to invest Guinness & Mahon was also' Involved In the granting of loan faculties to CTH although I was not responsible far organising these fecffitlee which were made available In 1972. 6. Some yean later, in October 1979, t had the sum of IR£50,000 to Invest TWs sum Included the sum of approximately tR£30,000 which I had accumulated since 1966 from commission payments from bands booked by me for the Mount Brandon Hotel and for the Central Hotel and also from payments made to me by the Brandon Hotel for obtaining the bands. The sums paid to me were converted . to bank drafts from time to time which I renewed during the period. The balance of IRE20.000 was made up of payments which I received by way of contribution towards my election expenses for the general election of 1977. Of this IR£20,000, approximately IR£14,000 was received from members of my own family with the balance of IR£6,000 from other persona. These sums I also converted into bank drafts which I believe I renewed from lime to time since 1977.1 decided that I would Invest the sum of IR£50,000 with Guinness & Mahon as I remembered my conversation with Mr. Traynor back in 1975 or 1976 when he indicated that he could get me a good return on any funds which I Invested with the benk. 7. I met with Mr. Traynor on 5 October 1979 at the Bank’s premises in Oame Street In Dublin by prior arrangement. I Informed him that I had IR£50,000 to invest and <***■ that I would be looking for the best rate of return he could get me. He Informed me that he could get me a very good return (trough the Bank with a Ivmd called •KHc Investments*. I invested the sum with Guinness A Mahon and received two Guinness & Mahon lodgment dockets for IR£30,000 and IR£20,000 respectively. Copies of these lodgment dockets are attached at Appendix 1 to this unsworn statement. Martin Keane, another employee of Guinness & Mahon, was also present at this meeting. ’• 8. 1believe that Mr. Traynor Informed me that I would be furnished with,statements In respect of my Investment on a periodic basis. However, I did not receive statements and I made contact with Mr. Traynor about this. Following my request I was furnished with some statements in late 1882 or early 1983. Copies of the statements which I received at this time are attached at Appendix 2 to this unsworn statement These statements related to the period from 19 August 1981 to 20 September 1982. The statements did not contain any heading and I have a recollection of contacting Mr. Traynor and asking him why this was so. He Informed me that K was for 'security mason?, When I received the statements I wrote In my own handwriting on one of the pages of the statements “£50,000 lodged to Guinness + Mahon Oct 1979". I also wrote on the same statement: “Kite Investments Limited MartinKeane Guinness + Mahon Limited £60,000". I subsequently added the other words which now appear on the first page of the statements. I believe I added these words some time priorto 1990. 9. Sonne time later I made further enquiries with Mr. Traynor concerning my Investment and he gave me a slip of paper stating the following: 'KHc - £72,893 Sfg". Some time later In 1888 I was Informed by Marlin Keane of Guinness & Mahon that the total of my Investment was Stg£82,688.00.1 noted this in handwriting on the slip of paper which Mr. Traynor had previously given me. A copy of the slip of paper together with my handwritten addition Is attached at Appendix 3. It was at all times my belief that my investment was with Guinness & Mahon in a fund known as Kile Investments. At no time was I informed by Mr. Traynor or by any other person In Guinness & Mahon or otherwise that my funds were invested or otherwise held by any other entity such as Ansbacher (Cayman) Limited (“Ansbacher"). As will appear later in this statement the first time I received any statement whatsoever which Indicated a possMy that my funds may have been Invested or otherwise held in Ansbacher was In May 1898. m i 1 0 .1made two withdrawals from my investment by arrangement with Mr. Traynor. Those two withdrawals were: IR£20,000 on 13 April 1889 and IR£10,000 on 18 June 1993. The first withdrawal was made by way of a Guinness & Mahon bank draft which Mr. Traynor informed me I could cash in the South Man, Cork branch of Guinness 4 Mahon. The second withdrawal was In cash. Both these withdrawals were made by arrangement with Mr. Traynor. 11 . Foftowing my election to DaH Elrsann In 1081 my contacts with Mr. Traynor were rare. I telephoned him on a number of occasions and I believe I called to see him on two occasions at his office In FtawBtiam Square to discuss how my investment was progressing. I believe that It was Mr. Traynor who Informed me that Mr. Keane had left Guinness 4 Mahon and that he had been replaced by Mr. Collery. I received a letter from Mr. Collery In March 1990 informing me that he was no longer working with Guinness & Mahon and that he could be contacted at Mr. Traynor's office In FltzwiWam Square. A copy of Mr. Colieiy’s letter to me dated 22 March 1990 Is attached at Appendix 4 to thle unsworn statement. 12.1became concerned about my investment since I had not been receiving any statements. Following Mr. Traynor's death In May 1994 I attempted to make contact with Mr. Collery. I had some difficulty In making oontact with him but finally succeeded in August 1995. I informed him that I was anxious to withdraw IR£50,000 from my Investment I also Informed Mm that I was anxious to obtain statements In relation to my investment This conversation took place on the telephone. Mr. Collery told me that I was seeking to make a large withdrawal. He also infoimed me that my Investment was being dealt with by a Mr. John Furze. I had not heard of this name before and I Informed Mr. Collery that as far as I was concerned it was Mr. Traynor and, following hit death, Mr. Cofleiy who was handling my investment I arranged to meet with Mr. Collery in early September 1995 In Jury's Hotel In Dublin so that I could obtain my withdrawal, i had never met Mr. Collery In person before and he gave me a description of himself so that I could recognise him. I recognised Mr. Coftery from his description and he furnished me with the proceeds of my withdrawal of 1RJE50.000 in cash. I converted the cash into two bank drafts in Bank of Ireland in Tralee. The proceeds of these bank drafts were used by me in December 1999 towards discharging outstanding tax labilitiea which I have to the Revenue CommlsslonerB. I was unaware as to the mechanism used by Mr. Collery to obtain the funds for my withdrawal. 1 was merely seeking a withdrawal from the funds which I had invested with Mr. Traynor in October 1979. I have recently discovered from evidence before the Tribunal of Inquiry (Payments to Messrs Charles Haughey and Michael Lowry) (the "Moriarty Tribunal*) that the proceeds for this withdrawal were obtained by Mr. Collery from Irish Intercontinental Bank and in turn debited to an account In the name of Hamilton Roes. I wat entirely aware of these matters have had no dealings whatsoever with either Irish Intercontinental Bank or Hamilton Ross. As for as I was concerned I was making a withdrawal from my own Investmentwith Mr. Traynor. 13.1had one further meeting with Mr. Collery In August 1998.1had telephoned Mr. Collery to look for statements In relation to myinvestment. I arranged to meet with him In Dublin Airport on 18 August 1998. The whole purpose of the meeting was so that I could obtain statements from Mr. Collery. I had made an appointment later that day to bring the statements which I required from Mr. Collery to my accountant In Dublin. The meeting took place in the Trust House Forte Hotel at Dubln Airport However, Mr. Collery informed me at the outset of the meeting that he did not have the statements which I was looking for. The meeting broke up shortly after this. Mr. Collery Informed me that he would furnish the statements to me as soon as he could. I then telephoned my accountant and cancelled the appointment which I had made with him. The appointment was subsequently rearranged for a date in September 1998. However, since 1had not received the statements from Mr. Collery by then I cancelled the September appointment with my accountant I was unsuccessful In attempting to contact Mr. Collery by phone following the August meeting. Some time later, fr) May 1999,1received by post at my home address in Kerry, a series of bank statements bearing the names Ansbacher and Hamilton Ross. The statements concerned the period from January 1993 to April 1997. They contained the account codes A/A40 and A/A49. Copies of the statements which I received by post In May 1999 are attached at Appendix 5 to Ms unsworn statement. The statements did not contain my name and were not accompanied by any covering letter or note so as to Indicate the person who sent them. There was nothing on the face of the statements to indicate that they related to any investment of mine. I had not previously heard. either name ft) connection with my Investment I am, however, aware now from evidence before the Moriarty Tribunal that the funds referred to in the statements which I received in May 1999 may be the funds which I Invested with Mr. Traynor In 1979. I have given instructions to Mr. Barry Benjamin, whom I have been Informed by the Moriarty Tribunal Is in control of these funds, to release the funds to my Solicitor to be used to discharge outstanding tax itabSIUes. A copy of this correspondence is attached at Appendix 6. Apart from this I have no contact whatsoever with Ansbacher or Hamilton Ross or any person or body representing either entity. 14. In addition to my Investment with Mr. Traynor in 1879 I also opened a bank account with Guinness & Mahon in December 1980. The account was a ‘ Resident Call Deposit Account”. It bore account number 10683009.1opened the account in December 1986 with a cheque In the sum of IRE3,342.05. Confirmation of the opening of the account Is contained In a letter dated 22 December 1988 from Mr. Collery. A copy of this letter Is attached at Appendix 7 .1made further lodgments of IRE4.885.27 and IR£12,180.50 in August 1987 and March 1988 respectively. In May 1988 I deckled to put this account In the Joint names of myself and my daughter. Margaret as I was concerned about the state of my health at the time. I had suffered a heart attack in June 1987. I wrote to Guinness & Mahon requesting my daughter’s name to be added to the account by letter dated 25 May 1988.1received a reply from Pat O'Dwyer, Banking Manager of Guinness & Mahon on 30 May 1988 confirming that the account had been transferred into my daughter’s joint name. Copies of thesa letters ara attached at Appendix 8. In late 19901was advised by Mr. Traynor that this account should be dosed and that the balance should be transferred to the Investment account with the finds which I had invested in 1979 so that I could enjoy the same beneficial Interest rates. The account was dosed on 15 November 1990 and the sum of IR£24,009.95 was withdrawn. Copies of the statements in respect of this Guinness & Mahon account are contained at Appendix 9 .1assumed the funds were transferred to accompany the other funds which I had invested with Mr. Traynor in 1979. However I did not receive any documentation confirming this. Mr. Traynor did not Inform me of the mechanism by which the account had been dosed and the monies transferred to accompany my earlier Investment I Just assumed it was a straight forward transaction which he was arranging. From evidence given at the Moriarty Tribunal there appears to have been a series of transactions between various accounts in different flnandai Institutions Involving the sum of IRE24.005.95 which was the balance in my Guinness & Mahon account when It was dosed In November 1990. However, I had no knowledge whatsoever of any of these transactions. My understanding was that the deposit account would be closed and that the proceeds transferred to accompany my eaiter Investment i wes entirely unaware of the mechanics as to how Mr. Traynor was proposing to Implement this arrangement. Furthermore, I was unaware (as appears to be the case) that the proceeds of the deposit account were lodged to an account in the name of or held by Ansbacher or Hamilton Ross. CENTRALTOURIST HOUMNQ8 LIMITED . 15.1have referred earfler to CTK I became a director of CTH In 1972.1was also an Investor in the company by means of an investment of IRES,000. I had been informed by the late William A. Clifford of The Spa, Tralee, County Kerry that the directors of the Mount Brandon Hotel were Interested in acquiring and developing the old Central Hotel and ballroom in Baltybunion, County Kerry. I agreed to partidpate In the venture and Invested the sum of IR£5,000 as I have indicated. The other directors of CTH were John J. Byme of Slmmonscourt Lodge, Simmonscourt Road, Battebridge, Dublin 4, Thornes Clifford of The Kerries, Tralee, County Kerry and the late William A. Clifford. I had understood that the other directors were making a similar investment and that the balance of the money required for the venture was being borrowed. I was not responsible for arranging the borrowing. However, i am aware that CTH obtained loan facilities of IR£70,000 from Guinness & Mahon in or about June 1972. It was my understanding that this loan was a straightforward loan from Guinness & Mahon to CTH. I received statements concerning the loan on a regular basis up to in or around the date of the closing of the sale of the Hotel In 1986. The premises were purchased and renovated and operated solely as an entertainment centre with a bar. I held the licence for CTH as the two other local directors already held licences for other premises in the area. Fotowfng a deterioration In the business of the company it was decided to cease trading and to sail the premises. I believe the premises were sold in 1986. The directors of CTH were required to contribute monies to fund a settlement with the Revenue Commissioners and with other creditors of the company. I made one contribution of IR£5,000 by cheque made payable to Haughey Boland on 16 October 1987. The purpose of this payment was, I was led to believe, by way of contribution towards the repayment of creditors of the company. I paid another cheque in tha sum of IR£2,787 on 28 October 1987 (also payable to Haughey Boland) which I understood represented my contribution towards repaying the Revenue Commissioners who were owed monies from CTH. The arrangements for tha winding up of the business of the company were managed by CTH'a Solicitors and by Paul Carty of Haughey Boland. I signed a cheque dated 20 October 1987 In the sum of IR£42,680.00 payable to Guinness & Mahon. This cheque was drawn on an account opened by CTH's Solicitors in the name of CTH In Bank of Ireland, Ustowei with the proceeds of sale of the premises. My recollection is that I was requested to draw the cheque by the company's Solicitors in order to finaRse matters with Guinness & Mahon. I believe I gave the cheque to either Mr. Grace, the company's Solicitor, or to.Paul Carty of Haughey Boland. I was unaware as to what Guinness & Mahon did with the cheque. However I understand from evidence at the Moriarty Trttjunal that the proceeds of the cheque may have been credited on 23 October 1987 to an account entitled "Amiens S/L No. 2 Account No. 10407006*. i have no knowledge, however, about that account I was unaware as to how the cheque was dealt with once it was paid over. I was glad to be out of the business of CTH as it had cost me money and I believe It seriously affected my health. CQHCLUPfflaSQMMBire / 1 8 .1 would be happy to explain or darify any issue arising from this unsworn statement I am also happy to co-operate fuBy with tfw Inspectors and as best i can to deaf with any further queries which they may have. Dated: ? April 2000 Signed: Denis Foley . .. i a) .2. unnum??-I-?ll . '0 I A'ppnn'nr-Ix STATEMENT OFDENI's FOLEY 1.0. TO THE APPOINTED BY ORDER OF THE HIGH COURT TO ANSBACHER (CAYMAN) LIMITED LODGMENT FOfl CURRENT ACCOUNT OF \ > Vi..l l ■1 1 y a o ao-o NM K O h w w . a lt. \ & o a uap ud lublact •* •«*MfUhMtoRml OT ■, vwntflartollMlaRncyMMmr'i nik.IMuthandludm mmuki - a..'.>■• ■-.t-s-:------- :------ p=---------{vtaaafton . nutncuLAiu 0-^W j^-ourK ... tV * W \------1 '( B A L A N C t B R O U G H T J.O R U A R D MfiuoHi. 0.00 RATf CHANS* i•3m ' 0.00 ' <}SE”P#i? RATE CHANGI 3. 512. 1S ._ :3(»epsi IHTERtST .r I " V*J . T» V* b . K vac I . GrtJucwwH ■ k %*a. ?«.*. \W x v v iV < s -y j^ % r ; •rV - ' [«C W o. ■» ‘ . : • s O v < ia o , * .<•) & 57,61J.*j’ S7, 615.41 61/ 127*Sf-. • \ •AlAMCK BIOUSHT FQRUAR* R A T* CHANGE INTEREST REV INT 0.00 2*267.S« 2*267.18 :■ , *£ # T 61.T2T.61 61,127.61' •; 41,127.61 '.VH rwrrrwrar B A LA N C E O d O IIG M r V A T C CMAMAF FEES IN T E R E S T 6 1 / 1 2 7 .6 1 fO »M * IIO i # 2o a . o a UldtlT ■' IA L A N C E B K 0 U 6 H 1 l A T t CHANGE 4/356.81 •r 64.2S4.AZ v isr 6A.2aA.A2 F 0 »U A «0 O.OU coKP TAji ♦ raxNu fms tA TE R ATE 41.1jr.fc1 0.00 J S 0 .4 2 2 4 JU N B 2 0.00 0.00 CH A N C E CHANCE 63.9JA.00 ■ 6 J .» 3 A .O O 6 * » V 3 * .0 Q . fs: * * * * * * * : . d * U rni - I * - ,— * i ■ ? * * vJ^-.'V * ;v-n* _ * " *: V * •':’■; .■ (‘ .B»i«L ** . * ■ n n n Sc ? i- »z > X M A • ><► -4 X » » *f a *l o t R Csl - I 9 » » • V / « % % « • * «»« <0^*«Of .WSO* « • • • 0 6 0 0 WNNO .. 3 I i APPEN ca? . ?0 I u. V I J* 1s t to C9 oG® *1 » d l «• e» r* r- J d ^ " A I 0 •g. *3 i-» a <} i i -r 4> * * a 2 I A K. t«l. 766(44/703068 ta M b itl 2035 :*il- 42 .FfTZWILLIAM SQUARE DUBLIN 2. 22nd March, 1990 D enis F o le y , E s q ., 6 Day P la ce , TRALEE, Co. K e rr y . Dear D e n is, I am w r it in g t o a d v is e you th a t I am no lo n g e r w o rk in g in Guinness 6 Mahon. My new telephone number i s or . you can le a ve a message w ith Joan W illia m s , M r. Das T ra y n o v S e c r e ta r y , a t Che above number and she w i l l c o n ta c t me. I would be g r a t e f u l i f you could g ive me a c a l l in th e n e x t week o r so t o a rra n g e a meeting as there a re one o r two x •th in g s I w ould l i k e t o d is c u s s w ith you. Yours s in c e r e ly . P .P . C o l l a r v . 9 APP-ENDIJC ■BM&B h* Addrvai G u ln n u s A / M O J laBBu ' ACCOUNTHUMKW M0016M M U W O B IH O W M A M IK pm I «t * r lln ( v s im .n 132773.71 n j m / v s B u m u o r o m i m —- __ ■^ (?rms nos: - - 1/03/93 31/03/93 -. an: as? Grand cumin Iduuh Wu! Indln . Toupth No. I??san - mu c? an: cub:- mm cum-u . . . mm 30001529 mu 2 . Mum- NI a: star! In. 0 13 .11 1140.13011430 . I {06/93 '2 . Box on? emu Cam armsh Wu! moi-?3? mm 100. W4 OP ans Cubic Addrul Guhmu AIAOD mm 00001629 3 MUM 18?. 17 j SL- p u a v m . . J . Box (8 7 Q rtn d Cayman British W » t l I T«l»phon* No. 9— 40534 T * ln C P a 0 5 C » b l« A d d ra n G u ln n m boss- A/M0 J L. AQOOUMT MUMMDt 00001619 M I IALAMCO SHOWN A M IN: it ir lln * 10/06/93 MOUaHTMMMMD Il/OT/93 16/06/93 IS 10000 126673,37 1 1/07/M V________ - c u m o r o m u i o (TuSilton SCSff - ' -~'l P.O. Box 887 Om nd Csyman British W est Indlts T tltph o n# No. *— 4653/4 ' T t lt x CP 305 Cabla Addrast G u ln n « i« - X/JAO L. J 1/00/93 30/09/93 30/09/93 30/09/93 J 30/04/93 30/09/93 ____ _ . ..... ..... l » t . A d ju f t . toXXBXXXX I n t c r M t t o 30/09/93 n w awwiMM ACCOM* NUMMR 90001639 MUNOSaHOWNAMm: M l s tc r lin f 1 1 M 7 J .3 7 2 0 . S< 1183ST. L_ ACOaWTNUMOR 30001629 MM K U w a a n H O n M M n i* . «t a r lin g 30/11/93 31/12/93 31/12/93 I n U r v s t t o 31/13/93 199337.17 1617.65 i aid 31/12/93 cvworommno U9974.M 6 Cmi l t o n mss ' L. n _j ACCOUNT MUHNR (0 0 0 1 6 3 9 M SI M UW OaHHOW W AM K ittr lln f M/oa/w 1 1/0 3/M 1 1/0 3/M 31/03/M I n t a r u t to 31/03/9* 1 3 9 9 7 4 .8 3 1 9 9 0 .7 9 131 53 3.6 1 7 . . . . . . . . . .- I . . 131525.61 1337.59 WW [Ob/9* 30/06194 to ?Q?lh?H "into-um 1/05/94 pl! I 0.00000.00000 I. 133003.20 AJ . 11". L_ accouhtnuumr goooiass mo» tuning u u m m m n m i m t t ll/M/M M /0 9 /9 4 ‘ » 10/09/94 I 3 3 0 9 3 .VO 30/09/94 I n t t r n t t o 90/09/94 OMWEPEOWWUP 1 5 9 3 .3 5 ISMfiVt.bS «i A/A4H L. J O / ll/ M >1/12/94 '*1/12/94 . J SOOUJA'J1) PAO* •M AM BM W BM M AM M c ta l-lln i 1 3 4 6 7 6 .3 3 31/12/94 I n t e r a c t t o 31/13/94 QUW PPOHW AHO 1 6 1 2 .4 3 1 3 6 2 IIII.W III OWWMXOWWO cft/co/ti L V U W .i C I wi'unr.mii II IH/V/V ws‘*n/.l ) a n jra u i aMa&O3Bsst S b /G O /K SA/CO/K m nn JB ^a M M V N M flH tttS M V W I 10V< GCVlOOOfl M M M IJLNnaaM r L. - waii i*- «vi) i auvMMMamura iiC '/X tA C I r.wcvi.1 wriM.icr r .l vunjn* » M ii'fV/y Wwi/ni S6/V0/UC n v>u*v>l E6/90/0C O/VO/OC a{ai wu'iiwgl L -5jr . uhiiiiBBBipiyimuai WW - ?Mao/[q norm sol-om Woo/o urn.th mum - min/t mama-v it! new mm uw/V mam - - ou-v-II? I II h. . p?i ?mm mum?) mm. mm?: aux-nu: mm 30/09/95 30/09/95 tn 30mm mus i 'l . 4 i .F nuns?? 5?i'Arsi'3E'2?r ?it ACCOUNT (Hum muse, Maw! --J I mm minnow not 1-. manna sterling ?Ila/?35 Inn-sum I W. (iM H ll.tM l « l * t " ~1 L_ _J JO/U/93 11/12/93 it f v tfn iKJUBIITfBWKI* 3 1 /1 I/9 S l n t* r * s t to 31/1J/S3 tM m m r a m u o ACCOUMTNUMCT m * * ,,,,* , ■MMMUHMWMiMt * «* star< 11. U'Wiq.Un 1125.1') ?7 mm mamamam.? . 31mm 31mm Int-rut go 31/03/96 morn . . ??x1m.mm a . . H'oVa' s? at: In Hamil. "rum 1.181: alum-mm M291 film mm .Lw? (. .5 . . Wan/o: 0% M1 mum mums 'waoloc 96/90/06 -mn ?ulw nhat ■SSL ( h am lto m s o s s - A/AA9 L. _j ttC O M TtM M R lucuam m om 30/11/99 31/13/93 31/12/93 M M M H rK P M M O Z a t t r w t t o 31/13/93 00001637 PM H urn f t «t> rU n g 36333.55 337.33 > ’ 31/13/99 tim m pam wm 30710.tB 3 ACCOUNTMUMMK 10001637 wuwoiiiHowwAHiR atwllnt 18/03/94 11/09/94 31/03/94 Inttrwt to 31/03/94 11/03/94 6 30710.09 3 42.57 39093.43 b J .. -wm 1637 aluminum I low autumn mm . IJVIV WE 1 I rmsense oi zoom": vane/o: also! 5 I . m-mznz - mm moo/I a . I ?v m •■ ■ ■ fl « flV H 1 r 90/11/94 moUOMTKNMMD 31/11/94 31/13/94 Interest tci.31/12/94 / A/A4-I JtCCOUMTNUUNR B0CXJ]6:f7 »*« •, UUMOBlNOMNiMINb rtcrUnK ; . . .. 39749.47 i U/13/94 9 ) L (mamltoh-jkk»- * * CMVMDPOIMMD 30KW.M ........... JU i '* ’ .* • * ^ m Ti l t o n m o s s - ■ ■ ^ f r L A/AV> H /W /W ' t l/ 0 3 / 9 5 31/03/95 m aum trvm m m J n t f e s t t o 33/03/93 VIOCOMTNUMMn N O U fllK ff M i M U W W M O W A M IW l « t w * i iutf a m io .t .s .1 78.33 t H /03/93 iiM in .in f lw w P T o n w w D III I 1 IMM M195 30/06/95 Ilium! to 11/06/95 mun-n 3 I WAG star! mnn'mu 3mle . Ill 1 Fm-mrr ?mmcalm/ac 0: 1mm! Woo/?c calm/{iwiH.TON ROSit - - 1 t ■ -J ' ________ .. HnwHrramMM 30/11/93 11/12/93 .11/12/93 Intftrast ts.31/13/99 ' S^gS^JlgOMW «“ ■wiPwwpwwwBi'B stunllim ■ i ■ . uix'ta.rw .19.1.92 * c u r w > m m w o WhH'% i riir.rm/H I -.-- i .4 a Si l'l - u?u. L. 29/02") sum/us 31103196 mm mun-t to 31mm a . a . A/Ahu mun-u autumn? m: . I GumsJ n * H u .T M i R i d a - n L_ _j A/AVi r ■■ u/os/w 3U/ftt/*JA 30/U6/96 KWOWOWM tm H t to30/06/96 .TJUM.IIH TW.46 i ‘ OMNDKVWAMO In itw itH K m o a m t m m a m InUrtM ' jn/ne»/o* m MlDHiAJ'/ MOC ,\ / a v . L. ACCOUNT NUMttft MKJItUiUY It. rtiiMiWot :iww,nj UD/09/9A 30/09/96 I n t w u r t t o 3U/OT/96 Sfe. (r*kiltoii SOW- * A/A49 L_ _J ACCOUNTNUMMft (0001637 PW>I W UWCW 30A1/WS 31/12/94 31/13/96 31/13/96 I r t t r M t ta il/U /M WWWAMWi r t « r lin « 33*93.10 414.04 39367.34 n APPENDIX 0 . g. .. n- A Elfin . ^ Mr B a rry Benjamin H a m ilto n Boss L td P .O . BoX 887 Grand Caynan Cayman Is la n d s B r i t i s h West In d ie s RE: ' • • • Memorandum Accounts Dear Mr Benjam in K/K40 & K/K49 . . I a* inform ed t h a t my' investm ents o r i g i n a l ly made p e r th e la t e Des T ra y n o r are i n tfce above named accounts and amount to a sum i n excess o f £140,000 s te rlin g * X now wish to w ithdraw these funds and I t r u s t t h a t you w i l l accept t h is l e t t e r as form al • • a u th o r is a t io n . 1 in s t r u c t you to fu rn is h the funds to my ' B o X io ito r Thomas J O 'H a llo ra n , S o l i c i t o r , Upper Ashe S t r e e t , T r a le e , County K e rr y . Ir e la n d . •" I f f o r any reason tlie funds cannot be re le a s e ^ t o my s o l i c i t o r im m e d ia te ly, p le a se l e t me know. . ■ ^ I am sending a l e t t e r on s im ila r terms d i r e c t l y to H a m ilto n Ross. Yours f a i t h f u l l y DENIS F0LB7 r H a m ilto n Ross L td P .O . Box 887 'G ra n d Cayman Caynan is la n d s ' . B r i t i s h West In d ie s RE: ; " : I Memorandum Accounts A/A40 Dear S ir s ^ ' & A/A49 ' . I an inform ed t h a t ray investm ents o ric in a lly / a a d a p e r th e la t e Dps T ra y n o r are in th e above named accounts and amount t o a sum in excess o f £140,000 s t e r l i n g . X now w ish t o w ithdraw these , •iu a d s and 1 t r u s t t h a t you w i l l accept t h i s - l e t t e r as fo rm a l a u t h o r is a t io n . I in s t r u c t you to fu rn is h , the funds t o my s o l i c i t o r Thomas J O 'H a llo ra n , S o li c i t o r < Upper Ashe S t r e e t , T r a l e e , County K e rr y , I r e la n d . i ■ i I f f o r any reason th e funds cannot be released to my s o l i c i t o r im m e d ia te ly, p le a se l e t me know. ' 1 1 am sending a l e t t e r Benjam in. on s im ila r terms d i r e c t l y Yours f a i t h f u l l y to M r. B a rry Ansbachbr (Cayman) H enry A nsbacher POBox 117 GrandCt^BM CAYMANISLANDS Biitiib Wm bAa TdtpJjom+1 345 *9 B6SS Fudjnite +1 MS 94973+6 Tdn CP430S ANSBACC E-imfl mbei)f@cnd«rjE f REGISTERED MAIL 14February2000 . e.O. Box 13 CAYMAN Dear Sirs, ■ ' We are«nnir«frfl& letter(andtherelevant envelope) from aMr. DenisFoley addressedtoyou with our P.O. Box number in error,which was opened by us inadvertently. W e also enolose another envelope(bothcame by RegisteredMail) addressedtoMr. BarryBenjamin, again incorrectlyusing ourP.O.Box. ' ' 'Ratherthanreturnthemail asincorrectlyaddressed,we have decidedtoforwardthan on toyou on this No doubt you will advise your contacts of your address and that there is no relationshipwifeAnsbacher (Cayman) Limited. .■ Yoursfaifhftdly, - J.B.Bothwdl ManagingDirector Bugs: c.e. Mr.DeedsFoley «7I«* PlYXWILUAM ■OUAnt. Ou«Li« a, imlans Tn.(rHONi (OI>070 >721 ' .Fax(Ol)87* MIT in c e n t O U 1 C ■hah. w * t m a « t « # v » l a w .i * & B eatty I T O R M i n w w w .v a u a .ia i. o .b.toaoai. S ThomasJ. OHaltaraaEsq., Solicitor, Upper Ashe Street, r e c e i v e d 2- M AR1999 Tralee, Co. Kerry. FagNo 066 7123024 kroh2000 RE: Denis Foley tad Hamilton Ross. Dear Sir, Furthertoourrecentfaxwe havebeenrequestedby HamiltonRossLimitedtoreplytoyour Client’slettertothem ofthe31* Januarylast Firstofallwe shouldpoint outthatyourClient’*letterwas addressedtoP.O.Box 887 which means Hut itreachedawry Ansbaoherwho sentiton toHamiltonRoss onthel^ulfc They requestedHamiltonRote toinformany correspondentthatthenisno nlsttanshipbetween '^liltonRoss andAnsbacher (Cayman) Limited. TheP.O.Box ofHamiltonRoss is1369. : ;ecttoauthorisationwithverificationand validationJEIimiltanRjosiispreparedtotransfer fimdainaccordancewith transferinstructions. Please forwardtous the following: 1. - 2. • The signed authorisationofyour ClientauthorisingHamiltonR o m totransferftmdato yourfirm. The authorisationshouldidentifyacopy ofyourClient'sPassportor DrivingLicence(withphotograph). The authorisationwillhavetobe completedbefore aNotaryPublicwho willalsoverifythecopyPassportorDrivingLicence. The Notary Public sealmustbe validatedattheApostileOfficeintheD epsrtmentofForeign Af&irs. ' .A letterofconfirmationfromMr. PadraigCollerywhichwillhave attachedtoita copy ofMr. Foley’sauthoritytoyour firmidentifyingMr. Foleyu theperson entitledto •v‘ claimthe Kindsheldby HamiltonRoss on hisbehalf. The letterofconfirmationfrom mi WU.TC*MATTT(KOTMIYPV*U6>, Mr. CoU«y shouldidentifyacopyofhi*PassportorDrivinglicence (wife pWngr«p>i) Mr. Coller/s signatureistobewitnessedby aNotaryPublicwho will alsobencprind toverifythecopyPassportorDrivingLicence. The sealoftheNotary Publicwillhave tobe validatedby theApostileOfficeintheDepartment ofForeign Affiun. Whfln ingtKiwuVyiitnitmtitouipleaaestalehow theftmdaaretobe transferred. If theyaretobe creditedtoan accountofyourfinnpleaaegiventhename and addroasofthe bank;thenumber ofthe accountandthesortcode. Yours fiithfully, VINCENT & BEATTY. G U I N N E S S + M A H O N LTD G H M 17 ColWs* 6rt«a Dublin 2 P.O. Sox MA Td: 796944 fcOLihwl ' » N « l« Our R ef AO'C/PMcG 22 December l?S6 Mr Denis Foley A Day Place Tralee CO KERRY Dear S ir RE: Account No. - ■ 10583^09 1 V« r e f e r to your recent v i s i t to our o f f i c e . Te confirm having .lodged cheque fo r 1 3 ,2 4 2 .0 5 (th re e thousand, three hundred and fo r ty -tw o pounds and f i v e pence) to a new Resident C a l l Deposit Account ‘in your name, value dated 2 2 /1 2 /S 4 . The In te r e s t r a t e a p p lic a b le to your account for th is month is 11 per cent gross. Gross In te re s t when applied Is subject to 35 per cent R e te n tio n Tax. The r a t e paid Is revlewable on the la s t working day of each rnonth. The p r e v a i l in g ra te nay be ascertained by telephoned/ w r i t t e n enquiry, or by reference to The I r i s h Independent and The I r i s h Tlrr.es each Monday. ?lease fin d enclosed signature card to signed by y o u rsn lf and returned to us a t your e a r l i e s t convenience. ___ Yours f a i t h f u l l y fo r GUINNESS*?IAHQN LIM ITED . p.nc iw4.m»N0iMMq; mi *«■«*‘f*1— -■•* JH CbiMM N * * I, J-t IW ' s z z s z z r **■ "W .... _ .................. .................. .................. . _ ..... _ a a /°~ Q Q ~ip flfli rt »-- A tti - « k \ __ . ____________ A 9 JStSk1L£iQ5&i-.............. ......... 1>hr» •*>-------------- — --------------------- ----------------- 1 --- ’.. _. V ^ v a g f- i *i il.VJfcnta. r " n 9itu ^ JS U r 1,AA -A.J>OJS^Ka. *^rn^*-*- It U U t U U t U M t t M tM X » rcuntu>t»<•« PO'D/SC M r. D an is F o l s y , 6 Day P l i c a , T r a le e , CO. KBRRY Dear D e n ia , "\ A/C N o. 10883009 • J._________ -_____ Thank yo u . f o r y o u r l a t t e r o f th a 25th I n s t . Aa re q uested I have arra n g e d t o t r a n s f e r th a balance o f th a abova acco u a t t o j o i n t acco unt i n y o u r name and th a t o f y o u r d a u gh te r Ms. M argaret V o le y . . I e n c lo s e a j o i n t mandate f o r com pletion and r e t u r n . W ith k in d e s t re g a rd a . s in c e r e ly . C iS A Pat O ’ D w ye r, Banking M anager. .vox t e e m '104f t t c T u » » % a -y e y & o r ** im t is * cm au m .u ,* h m ,B n « w ,r«c- :••••-*•-;-.• ••.. •••■ ‘ •■.v r'v-'. ■ *' v' - m 'w i*S.I '*T • • •»' . /■ *r‘ ; ^ i y r -tfj. . ..jj*c• . .*• 4. V;'i- The’aforementioned payment shall'bn ^xoade by ■the Pvivchasg.r"V. ; -v $ * * * * * * '. • t .Vxeexited' Foijnsbt' '.'V}_«fisWc WT-s beneficial owners > .--Jir-y • .bee n\ lodqed;.with' H&s ayis';• Maple s, ai .* :i;r"A:v^V.'if.'*'’ v * * . '*• ;*■*" *' : . t . ■■ -Grand Cayrtaiir British,jfes^-Iilai&Eh *; ■ ... •.•►■ •■ ■.> •':■ •' K'~: ••>•v*y.•!'*’ 'tion ’as* (Bscrow .^g^n't in ^ne noint^hOTiBS^ ■?*■'.:'"r . :■ ■•''■••*:.•' •• ■* . . ■ *' J3<-■ ■ :■ »V." ■ '* £ •? '.,••■ ■ r*;C **V* V* ' * • ’ ** P P Authorisation S T R fB U T IO N O F C O P IE S W H IT E r to o p e n CttrknUSection. YELLOW : D e p o s i t BunkingMtttagtr. P IN K ? A u th o r ln d B y : & A c c o u n t Cash. BLUB 8 ? - f Control tik k U .S n ta m a m N a m a : r . M 9 rw : Q a r ic a l ... ^ ~ I • 'v*V & . C H E C K L IS T D a ta A /C C o n ta c t . Ctntral Filing U - & . * r . a : _ '■ . . (Ifdlfftnnt flttm abort/ ■ (Ifdifftnnt from tianj ■ it. ■ . *•. ' s. 'mat ol ixuting account* Im M : /, 'S I G N I N G OW ERS In d iv id u a l A / C S lg n a tu r a C a r d J o ln t/F lrm /C o m p a n y A /C M a n d a w F o rm . R E C E IV E D SEN T OU T IStrOti out whhhtvr not qffUemMtj J ltfr.B tffra w f ( ^ A U T H O R IS E D T O S U P P L Y IN F O R M A T IO N Bat i r i t f t m l ’X" (tfafflrmmtt** m a r * . " A h “X") F O R W A R D I N F O R M A T I O N T O ____ 1___________ □ “ ‘ nwifiyya»— no»a^ i> i ► AMOUNT 09 D E P O S IT fPc/HS', * o o -&o. 2 OAYS.. CALL 7 D A Y S .... R a ta X I M O N T H .. R a ta X R a ta X R a ta X R a ta X C A L L /N O T IC E D E P O S IT 14 DAYS. aimrnmiimi R a ta X 3 MONTHS... MATURITY OTHER tS»MvL. Rata X F IX E D TER M D E P O S IT STANDING INSTRUCTIONS TO RELOOGE .m v a ttm e m C u tto m v ri A /C Ifapplictble tick box with tn "X a Staff Account IftppUcatolr tick box with an COMPUTER FILE SET-UP F O R M COMPLETED BY - Of!> M 1 Authorisation to o p e n D eposit A c c o u n t ~ B ) J DISTRIBUTION OF COPI£3_^WHITEjO«Hc« A/C CBntact Addran: Sjts.________ Scatarnam Nam*:llfiilfftrtnlftnm atam Addrun:uraifTmntflvm tbort) Oatailiof mining account! hatd: ■V»>, l+ f nnnmEEifirj ACCOUNT NUMBER RESIDENCY STATUS Raddant □ CURRENCY DESIGNATION TTc* R U nm tb axn wttH "X ” I COOS I Extamal TickRtknmt Box iWrt m Othar Sptlhi T & MATURITY INSTRUCTIONS Individual A/C Sgnatura Card Joint/Firm/Company A/C Mwdwi SIGNING POWERS Non-Raaldant Paunda SUrllng Psundl STATEMENT REQUIREMENTS CLASSIFICATION SENT OUT fStrikeout wklehmr mattpflknhlt/ RECEIVED rickRtltvmnr«a» with. AUTHORISED TO SUPPLY INFORMATION Ilfi/pnmHn with "X") □ ■ m In te rn atio n a l F r u it Agents. c /o , Guinness Mahon Cayman T ru st Ltd. P.O.Box’ . 887, Grand Cayman, BRITISH WEST INDIES. G u i n n e s s & 17 COLLEGE GREEN M a h o n Ltc DUBLIN I TELEPHONE 7824* TELEX 520! « < « 0 A U - /iXv^i 5 MARS El G M DUBLIN 14.10.77 Q~ ^ FOR HR MARTIN KEANE RE YOUR TELEX OF YESTERDAY.THE BALANCE INCLUDING INTEREST TO DATE ON THE F.I.I. OEPOSIT WAS 2S.S27.54 DOLLARS. EQUIVALENT IS POUNOS 16,870.09* AFTER DEDUCTING PAYMENT YOU INDICATE OF 2166.59 AND TELEX AND SUNDRY CHARGES DUE TO US OF POUNDS 1*8.04 THERE IS A BALANCE OF 14.656.46. CONFIRM YOU MAY DEBIT THIS TO SUNDRY* SUB-COMPANY ACCOUNT. PLEASE ASK T.fi.L. TO TELEX ADVISE SUNDRY SUB COMPANY ACCOUNT BALANCE SO THAf WE CAN ;REPLENISH IF ACCOUNT S OVERDRAWN BY REASON OF ABOVE TRANSACTION REGARDS JOHN FURZE CORRECT IONi THERE IS A BALANCE OF 14,655*46 5205 MARS El 305GUINNESS CP 3 I I .A?pp?ndiigsxv . SDHDRY s ta te m . SU9. . W a e n t 26*74 1,50^145. GUINNESS HAHON CAYMAN TRUST LTD dal. cad. * date cad. r mi d O tlC M A It M itt C ttO M JOV 25*74 250.00 > 2 2 0 4 7 *­ « % % 7 k TSFO FROH B /A . . 1 27 74 V .O . 3 0 / 9 IN T D IF F B /2 V .D . 1 9 .9 .7 *1 TO REVERSE ENTRY -Ai 28 *5 NT RECD FROH F .N .C .B K ON ‘i .OOGED Jmi.2»*,-5 l 60© NO. 2 rf(l IIS I 00 GEO 9 ltU 475 /At j l 12 7 V INTL. FKUIT AGLNTS 575 h‘/5 5 75 575 23031 4,737.15 65.72' 47:24" 76755­ 1,182.79' 34S21- s^ooaiQ.* 6400000 SFO 'S ' S Y IM O L I debit bdiaec M l( tadgmni tt ctuqu. book . credit bilance cm aammWon cw cuh witftdrtwil to ftmdinf etdtr i7Siio<;c cadtfUwft) ■ H ill w r t i l w a U»il{3) Amico 141.42 4.07934 141.42 4.07934 l i V 143J5 4.0793J 14SJ0C 4.07934 156jo; <.0»3ttS S 4,079> US s 4,0793 4,0793 4,679,62 4,91053 91055 V 697.68 • • • • 196 Jl 196 Jl *7 3 S 4 0 • *782.64 ■ 1Q^S49J9 • 11*732.68 • 17J 4,31 o r 3134 *% 310.85 4655 *4 ,3 1 0 4 5 51J57 < 4.310J5I 12,077.0 21,077.8* • • 61.lt 61.K 1 oia*s 1 1 ,0 9 L » • *0 7 9 .9 310 JK X 510? 4.310JS 5(^013.70* 0 0 0 jO O ' 1 6 4 .f l' 66.41 4,310*5 1^091.59 • 1 \ 926.12' • SIJO' J 8La 4,310.8! 4,310* 15,649.52 84.54 { 4.3108S 15000 15080 . CLEPIffUlE CALLS OUBLIN Rawn drfc* LOO 26M ' OOGED ( B /G ) 11 £*457.61 ■ 4,12421 • -206.15 ‘ fcf '8 .2 7 '5 3 2 9 IAN1575 •Ml 2275 •iii .fc iB t tZ 416.14 • £7,666.14 ■ . ^SUJ5« ' mhuI ACCJUCO “ :HEQUE IN F / 0 LLOYDS BBK RE * F A R s iN l OE 'UBLISHERS LTD* 1 . 0 . I / 1 2 I NT O IF F FOR 0 / A r0R P /Z rF FROH E X T . SUSP/ NT TO DATE 1cashI M I I •UJD 10 JO - 7o t 1 CLASSIFICATION Nk --GROUP . [a c c o u n t 15.0U 56&40 OfIII IN IiR iS f cunr SlillINC fOUIVAllNT ho,!, No a u t h o r i t y t o s u p p ly in f o r m , o v e r phone o r t o a u d i t o r s . R a te 8 % fix e d . I n t . q r t . on 3 1 s t M arch OONOt and 3 1 s t n n r.. e a c h v e a r . T n t. Appendix XV (45) Mr Arthur Gibney 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Arthur Gibney. a) Transcript of evidence of M r Arthur Gibney dated 15 March 2000. b) Guinness and M a h o n letter of 18 October 1977 to M r Arthur Gibney. c) Guinness and M a h o n letter of 14 October 1976 to M r Arthur Gibney. d) Guinness and M a h o n letter of 28 September 1976 to M r Arthur Gibney. e) Guinness and M a h o n internal m e m o of 18 M a y 1976. f) Letter of 13 March 2000 from Hayes & Sons to Inspectors. g) Statements of a/c ref: A / A 2 Ansbacher Limited of 31 October 1992, 31 December 1992, 31 January 1993 and 30 April 1997. h) Undated letter of guarantee to Guinness and Mahon. UNDER OATH ON WEDNESDAY, 15TH M A R C H 2000 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO M R . ROWAN FCA MS. M A C K E Y BL S o l i c i t o r to the I n s p e c t o r s MS. M. C U M M I N S Interviewee: MR. A R T H U R G I B N E Y R e p r e s e n t e d by: MR. A N D R E W W A L K E R HAYES & SONS SOLICITORS LAVERY HOUSE EARLSFORT TERRACE DUBLIN 2 I WITNESS EXAMINATION MR. A. GIBNEY MR. JUSTICE COSTELLO MR. ROWAN MS. MACKEY 47 65 PAGE 46 64 76 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Gibney, we will start o u r i n t e r v i e w the n. 6 M y n a m e is D e c l a n C o s t e l l o a n d o n m y r i g h t 7 is Ms. 8 know we have bee n a p p o i n t e d Inspectors b y The High 9 Court. M a c k e y a n d o n m y l e f t is Mr. Rowan. As you 10 MR. GIBNEY: I understand. 11 MR. JUSTICE COSTELLO: I s h o u l d e x p l a i n to you, 12 as I a m s u r e y o u 13 appreciate, 14 Tribunal. 15 i n v e s t i g a t i o n a n d t h i s is a n i n t e r v i e w . 16 MR. GIBNEY: Yes. 17 MR. JUSTICE COSTELLO: If, t h i s is n o t a C o u r t a n d it is n o t a W e a r e m e r e l y c a r r y i n g o u t an 18 in fact, you have any difficulties a b o u t a n y of 19 t h e q u e s t i o n s t h a t we ask, 20 c o n s u l t y o u r s o l i c i t o r a b o u t them . 21 MR. GIBNEY: Yes. 22 MR. JUSTICE COSTELLO: Similarly, 23 please f e e l f r e e to if t h e r e a r e any problems that your 24 s o l i c i t o r h a s in r e l a t i o n to a n y q u e s t i o n s t h a t we 25 w o u l d a s k h e c a n t e l l us so a n d w e w i l l s t o p a n d y o u 26 can take advice. 27 MR. 28 29 GIBNEY: Yes. 1 and now I'd ask our solicitor, 2 a d m i n i s t e r t h e O a t h t o you. 3 MR. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 GIBNEY: Yes. Ms. Cummins, to 1 2 AS FOLLOWS. 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Gibney, you supplied us w i t h a n u m b e r of 6 documents, 7 s o l i c i t o r s u p p l i e d us w i t h a s t a t e m e n t , 8 i n f o r m e d us he w a s 9 A. 10 2 Q. 11 A. 13 3 Q. It is a d o c u m e n t d a t e d 1 8 t h O c t o b e r 1 9 7 7 a d d r e s s e d 1) ? 4 Q. O'Dwyer from the loans office T h e r e f e r e n c e is 13 6 at t h e t o p of t h e . . . (INTERJECTION) 19 MR. WALKER: W h i c h s e c t i o n of t h e 20 n u m b e r is i t ? 21 n u m b e r of d i f f e r e n t 22 MS. There are a s e c t i o n s in the file? CUMMINS: 23 We a c tually have a paginated copy (Same 24 handed). 25 MR. W A L K E R : A l l right. MR. Y o u se e t h e r e Mr. 5 Q. JUSTICE COSTELLO: 27 28 29 (Exhibit Yes. 18 26 in Yes. 15 17 s ending on your be h a lf ? file you sent us? to y o u b y Mr. A. w h i c h he I w a n t to b e g i n b y r e f e r r i n g yo u to a d o c u m e n t 14 16 Your Yes. this 12 w h i c h we o b t a i n e d yesterday. Gibney t h a t t h e r e is a l e t t e r o f 1 8 t h O c t o b e r 1977 to you? 1 2 " C h r i s D o d d r e c e n t l y w r o t e t o Mr. J.D. T r a y n o r to g e t c o p i e s o f p e r s o n a l acc o u n t s of b o t h Sam S t e p h e n s o n and y o u r s e l f ..." 3 4 5 6 "...and the bac k i n g funds 7 1s t O c t o b e r 1 9 7 6 . " from the 8 9 A. 10 7 Q. 11 Yes. A n d t h e y had, "I h a v e t o d a y w r i t t e n to h i m g i v i n g h i m t h e i n f o r m a t i o n r e l a t i v e to S a m a n d a d v i s i n g t h a t I a m w r i t i n g to y o u letting you have information covering your own position." 12 13 14 Then: 15 16 "Acc o r d i n g l y , I h a v e p l e a s u r e in attaching hereto a statement covering y o u r r e s i d e n t l o a n f r o m t h e 1st O c t o b e r 1 9 7 6 to c l o s i n g . Also note covering t h e C a y m a n p o s i t i o n f r o m t h e 1st O c t o b e r to c l o s i n g . " 17 18 19 20 C o u l d y o u t u r n o v e r t h e p a g e t h e n Mr. 21 A. 22 8 Q. 23 Gibney? Yes. Do y o u see: "C a y m a n , 1st O c t o b e r 197 6, b a l a n c e £142,973. 40"? 24 25 A. 26 9 Q. 27 A. 28 10 Q. 29 Yes. D o y o u se e t h a t ? Yes. Then interest and then interest and the total was £ 1 4 7 . . . (INTERJECTION)? 1 2 11 Q . Yes. 3 " A c c o u n t c l o s e d b y t r a n s f e r to Arth u r Gibney loan"? 4 5 A. 6 12 Q. 7 A. 8 13 Q. 9 Yes. Is t h a t c o r r e c t ? Yes, I se e tha t. D o e s t h a t m e a n Mr. G i b n e y t h a t at t h a t t i m e y o u h a d i n t h e C a y m a n a c c o u n t £14 7, 10 A. 11 14 Q. 12 A. 13 15 Q. 14 A. 15 16 Q. 16 A. 17 17 Q. 18 A. 19 18 Q. 20 A. 21 19 Q. 22 A. 23 20 Q. 24 A. 25 21 Q. 26 A. 371.62? T h a t w o u l d a p p e a r so. Yes? Yes. I w a n t y o u to t e l l m e a b o u t t h a t a c c o u n t ? H o w it o c c u r r e d . A n d h o w it o c c u r r e d ? Yes. A n d w h e n it o c c u r r e d ? Yes. I w a n t y o u to g o i n t o as m u c h d e t a i l ? Detail. As you can? Yes. I k n o w t h a t it is a l o n g t i m e a g o ? Yes. Mr. Yes. Gibney? Well, I w i l l t e l l you. I w i l l t e l l y o u as y o u 27 f a r as I can. 28 p a r t n e r in S t e p h e n s o n G i b n e y & A s s o c i a t e s . 29 22 Q. Yes? In t h e 1 9 6 0 ' s I w a s i n p r a c t i c e as a 1 Mr. 2 i n v o l v e d i n a s e r i e s of p r o p e r t y d e a l s . 3 i n v o l v e d as a r c h i t e c t s a n d w e b e c a m e i n v o l v e d as 4 d e v e l o p e r s wit h a c o n s o r t i u m of businessmen. 5 23 Q 6 A D e s m o n d T r a y n o r was our a c c o u n t a n t and we be c a m e Yes ? A n d there were a nu m b e r of sites involved. 7 important 8 F i t z w i l l i a m T e n n i s C l u b site, 9 a previous 10 We became site, I th i n k , The most was the present w h i c h r e l a t e d a l s o to F i t z w i l l i a m Tennis Club site w h i c h was a l o n g t h e ca n a l . 11 24 Q 12 A 13 Yes ? A n d t h e r e w e r e a n u m b e r o f o t h e r s i t e s as w e l l b u t they were never developed. 14 25 Q Yes? 15 A Now, we star t e d m a k i n g p r o f i t s in d e a l i n g w i t h t h e s e 16 s i t e s a n d t h e p r o f i t s w er e , 17 Mr. 18 about 19 i n H a u g h e y B o l a n d to a s e n i o r p o s i t i o n i n 20 Guinness 21 a M a n a g e r D i r e c t o r but he u l t i m a t e l y b e c a me 22 Managing Director. 23 26 Q 24 A I th i n k , handled by T r a y n o r on b e h a l f of the c o n s o r t i u m a n d a r o u n d 1970 he m o v e d f r o m b e i n g an a c c o u n t a n t & Mahon. I don't k n o w w h e t h e r he was t h e n Yes ? A n d at t h i s s t a g e t h e r e w e r e a c e r t a i n a m o u n t o f 25 profits mad e but this 26 t h e F i t z w i l l i a m T e n n i s C l u b site . 27 m inor sites involved. 28 d e v e l o p m e n t as f a r as I c a n r e m e m b e r , 29 building, is b e f o r e t h e a c q u i s i t i o n of There were other There was no actual no actual o n a n y of t h e s e s i t e s at t h i s st a g e . 1 27 Q. 2 A. Yes? But we were i n v o l v e d ourselves, t h i s is m y s e l f a n d 3 Sam Stephenson, 4 h a d t h e m as o u r o f f i c e s in A p p i a n Way, 5 It w a s n u m b e r t h r e e -- I a m n o t c e r t a i n i f t h e o t h e r 6 w a s n u m b e r f o u r -- no, 7 think. 8 So, 9 consortium. 10 28 Q. 11 A. 12 i n t h e o w n e r s h i p of t h r e e s i t e s . The y were part of this d e v e l o p m e n t parcel. w e s o l d t h e s e s i t e s to t h i s d e v e l o p m e n t What We mad e a fair amount. is t h e n a m e o f t h e d e v e l o p m e n t c o n s o r t i u m ? I m i g h t g e t it w r o n g . MR. W A L K E R : I think there were a n u m b e r of c o m p a n i e s . A. 15 Yes. MR. W A L K E R : A n d t h e r e is -- o n e o f t h e 16 letters lists the 17 18 d i f f e r e n t names. 29 Q. MR. JUSTICE COSTELLO: 19 W e w i l l l e a v e it f o r t h e m o m e n t then. 20 Mr. 21 A. 22 30 Q. 23 A. 24 31 Q. 25 A. 26 32 Q. 27 A. 28 33 Q. 29 W i n t o n Roa d. n u m b e r five a nd n u m b e r six I 13 14 We Continue Gibney? Sure I can always Yes. C o n t i n u e Mr. Sure, Okay . f i n d it f o r you. Gibney. Y o u a r e g i v i n g e v i d e n c e to m e n o w ? Yes, sure. To t h e I n s p e c t o r s ? Certainly, yes. Y o u are not g i v i n g e v i d e n c e to y o u r s o l i c i t o r ? 1 34 Q. 2 A. 3 35 Q. 4 will you please? Repeat your question again please? Yes, I a m n o t b o t h e r i n g at t h e m o m e n t i n r e l a t i o n to that? 5 A. 6 36 Q. 7 A. 8 37 Q. 9 10 J u s t a n s w e r m y q u e s t i o n s then, Yes. W e w i l l c o m e b a c k to it l a t e r o n? Yes. I am just c o n c e r n e d about the de po s i t in the Cayman Islands? A. Well, at t h i s s t a g e Mr. T r a y n o r came to m y s e l f and 11 Mr. 12 providential 13 families. 14 think, 15 had, 16 as he w e n t i n t o G u i n n e s s 17 serious coronary condition. 18 38 Q. 19 A. S t e p h e n s o n a n d he s u g g e s t e d it w o u l d be for us to h a v e a t r u s t f u n d for our He h i m s e l f was p a r t i c u l a r l y c o n cerned, b e c a u s e h i s h e a l t h h a d n ' t b e e n v e r y go o d . I th i n k , I He h a d a h e a r t a t t a c k just w h e n he h a d - ­ & M a h o n he h a d a v e r y Yes? He h a d f o u r o r f i v e i n t h e f a m i l y a n d h e w a s 20 c o n c e r n e d about his own family. 21 t h r e e or four children. 22 s t a g e a n d I w a s n ' t p a r t i c u l a r l y c o n c e r n e d b u t he 23 t h o u g h t it w a s p r o b a b l y a g o o d i d e a t o h a v e a f a m i l y 24 trust. 25 39 Q. 26 A. Sam Stephenson had I h a d n o c h i l d r e n at t h i s Yes? A n d m y m e m o r y o f t h i s is a b i t v a g u e b u t I do 27 r e c o l l e c t h i m b r i n g i n g i n a n e x p e r t w h o -- I t h i n k 28 h i s n a m e w a s D o n R e id . 29 from another accountant's office, I t h i n k at t h a t s t a g e h e w a s the firm that 1 pr e c e e d e d Stokes Kennedy Crowley. 2 Kenn e d y Crowley. 3 trust, 4 these profits, 5 was around 1970/71. 6 40 Q. 7 A. 8 41 Q. 9 I think He t a l k e d a b o u t s e t t i n g u p a a fa m i l y trust. Part of this money, that was w e r e p u t in a C a y m a n a c c o u n t . Yes? A s f a r as I c a n r e c o l l e c t . A r e yo u g o i n g to be a l i t t l e b it m o r e Mr. specific Gibney? 10 A. 11 42 Q. 12 A. 13 43 Q. He t a l k e d a b o u t t h e t r u s t ? 14 A. He t a l k e d a b o u t t h e t r u s t . In t e r m s of d a t e s ? No, in terms of the a r r a n g e m e n t ? W e l l ... ( I N T E R J E C T I O N ) . As f a r as I k n o w t h e r e 15 was n e v e r a formal trust i n s t i t u t e d but we did 16 ha v e . . . (INTERJECTION). 17 44 Q. 18 19 This W h y do you say that? Did you get a . . . (INTERJECTION)? A. I n e v e r -- I n e v e r -- I n e v e r r e m e m b e r a n y -- I 20 remember myself and my wife signing many documents 21 but I never remember any document 22 r e l a t e d to -- I m e a n m y i d e a o f a t r u s t w a s a f u n d 23 w h i c h I c o u l d n ' t touch. 24 45 Q. 25 Perhaps, I m i g h t assist you in your r e c o l l e c t i o n Mr. 26 A. 27 4 6 Q. 28 A. 29 Yes. signed which Gibney? Yes. F r o m o t h e r e v i d e n c e we h a v e o b t a i n e d ? Yes. 1 2 3 A. Yes, 4 48 Q. Yes? 5 A. 6 49 Q. 7 Yes. A n d t h a t yo u w o u l d be one of the b e n e f i c i a r i e s of the beneficial trust? 8 A. 9 50 Q. 10 A. 11 51 Q. 12 A. 13 52 Q. 14 15 I t h i n k so. I a m n o t c e r t a i n a b o u t t ha t . You are not certain? I a m not, no. W h e t h e r you w o u l d be? Yes. However, yo u w e r e not g o i n g to give a w a y the m o n e y so t h a t y o u w o u l d h a v e n o c o n t r o l o v e r it, A. Well, my understanding, were you? and w h y I r e m e m b e r this was 16 because 17 w o u l d b e e n t a i l e d in a w a y t h a t o n l y m y f a m i l y a n d I 18 c o u l d n ' t -- it w o u l d b e f o r t h e b e n e f i t o f c h i l d r e n , 19 m y children. 20 53 Q. 21 A. 22 I d i d n ' t p a r t i c u l a r l y l i k e it, Yes? A n d I w a s n ' t p a r t i c u l a r l y i n t e r e s t e d i n it at t h e time because 23 54 Q. 24 A. 25 55 Q. I h a d n' t got children. W e l l ... ( I N T E R J E C T I O N ) ? I a d o p t e d a son. Y o u m e a n to s a y y o u w e r e g o i n g -- he w a s 26 the establishment 27 for your children? 28 A. 29 56 Q. w a s t h a t it of a t r u s t , suggesting a d i s c r e t i o n a r y tr u s t , T h a t is w h a t t h e t a l k w a s a b o u t . At a time w h e n you h a d no c hildren? 1 Yes, 2 h a d n ' t go t a f a m i l y . 3 had families. 4 57 Q I w a s a d o p t i n g a c h i l d at t h i s stage but I The other two people involved D i d h e t e l l y o u t h a t in f a c t a n a c c o u n t a n t in t h e 5 C a y m a n I s l a n d s w o u l d in fact be the s e t t l o r in the 6 trust? 7 A 8 yes. I r e m e m b e r he t a l k e d a b o u t a s e t u p in t h e C a y m a n I s l a n d s . 9 58 Q 10 A 11 59 Q 12 A 13 14 He m a y h a v e t o l d m e tha t, D oing the best you can now? Yes . Can you remember him telling you that? No, he t o l d m e t h e y w e r e e s t a b l i s h i n g a n o f f i c e in the Cayman Islands. 60 Q I am not t a l k i n g about an office. I am talking 15 about trusts, 16 explain, 17 t rust deeds, 18 t h e r e w o u l d be a t r u s t set up in C a y m a n b ut you 19 w o u l d not be the actual settlor? 20 a b l e t o t r a n s f e r f u n d s to it? 21 A 22 61 Q Mr. Gibney. w o u l d it not, Do y o u s e e t h i s w o u l d why you did not sign any if he t o l d y o u t h a t t h e s c h e m e w a s t h a t Y ou w o u l d not be Yes . It w o u l d b e se t u p a n d t h e a c t u a l s e t t l o r w o u l d b e 23 p e r h a p s one of the a c c o u n t a n t s out in the Caymans. 24 D i d he tell you that? 25 A 26 62 Q He m a y w e l l h a v e ? 27 A He m a y w e l l hav e , 28 63 Q 29 I can't recollect. H e m a y w e l l ha v e . yes. I c a n ' t b e c e r t a i n of it. Do y o u se e I w i l l b e r e f e r r i n g y o u i n a f e w m o m e n t s to a n o t h e r d o c u m e n t w h i c h r e f e r s to t r u s t funds. I 1 was w o n d e r i n g can you be any more 2 w h e t h e r o r n o t t h e y m a y h a v e se t u p a n t r u s t o u t in 3 the Cay m an s ? 4 Well, 5 64 Q 6 A 7 I t h o u g h t t h e y h a d s e t a t r u s t up. You did? I t h o u g h t -- yes, I always h a d the b e l i e f that there w a s a t r u s t s e t u p o u t in t h e C a y m a n . 8 65 Q 9 A 10 66 Q 11 A 12 F o r . . . (INTERJECTION)? In t h e C a y m a n s . For you? Well, for m y family, 67 Q Yes. However, 13 A Yes, 14 68 Q 15 16 specific about you used the m o n e y that was H o w c o u l d y o u h a v e u s e d it if a t r u s t w a s Well, sent out? I did. you h a d no int e r e s t A yes. set u p a n d in i t? I then p r e s u m e d that they had never finalised 17 the trust. 18 out m y s e l f o ver a p e r i o d of the last year and I went 19 a n d s a w Mr. 20 h o p e t h a t h e c o u l d e n l i g h t e n me. 21 remember until 22 r e m e m b e r e v e r m e e t i n g t h i s m a n D o n R ei d . 23 69 Q 24 A 25 70 Q 26 A 27 71 Q 28 A 29 72 Q I m e a n I have b e e n t r y i n g to figure this S t e p h e n s o n to d i s c u s s it w i t h h i m i n t h e He c o u l d n ' t I p r o m p t e d h i m -- he c o u l d n ' t Yes ? A n d I said, Perhaps, "Don't you remember this?" w e w i l l t a k e it i n a d i f f e r e n t w a y ? Yes . Funds were sent out? Yes . 1 2 73 Q. 3 A. 4 How were these transferred? I h a v e n o i dea. I m e a n Mr. of t h at . 5 74 Q. 6 A. 7 75 Q. 8 You must have known the amount that was A t t h e tim e, yes, sent out? I a m s u r e I did. Y o u se e it w a s a s u b s t a n t i a l s u m t h a t w e n t out, was it n o t ? 9 A. Yes, 10 76 Q. Yes? 11 A. 12 77 Q. 13 A. 14 78 Q. 15 A. 16 79 Q. yes. A t t h e t i m e I a m s u r e I did. Was this f r o m Mr. Traynor? Yes. For you? Yes. Was this f r o m t h e f u n d s o b t a i n e d as a r e s u l t o f t h i s 17 joint venture with Guinness 18 Mr. 19 T r a y n o r t o o k care of all A. & Mahon and/or Traynor? It w o u l d be. It w o u l d b e m a i n l y f r o m t h e j o i n t 20 v e n t u r e a l t h o u g h al l t h e p a r t i c i p a n t s 21 joint venture, 22 w o u l d n ' t b e i n v o l v e d n e c e s s a r i l y i n a l l of t h e s o r t 23 of p r o p e r t y d e v e l o p m e n t s . 24 80 Q. 25 No, i n t h e s o r t of t h e F i t z w i l l i a m T e n n i s C l u b site, I a m r e a l l y i n t e r e s t e d in y o u r o w n m o n e y o u t in the Caymans? 26 A. 27 81 Q. 28 A. 29 82 Q. Yes. W h i c h came e v e n t u a l l y to £ 1 4 7 , 0 0 0 ? Yes. W a s t h i s p a r t o f y o u r f e e s as a n a r c h i t e c t t h a t w e n t 1 out? 2 No, 3 s e l l i n g lands, 4 83 Q not necessarily. I t h i n k t h e y w e r e p r o f i t s on s e l l i n g si t e s . S u r e l y y o u c a n r e m e m b e r w h e t h e r or n o t y o u 5 t r a n s f e r r e d o r i n f o r m e d Mr. 6 w h e t h e r or not t hese went out or not? 7 A 8 Well, T r a y n o r of y o u r fees an d I m e a n t h e f e e s -- p a r t o f t h e f e e s m a y w e l l have gone o u t . 9 84 Q 10 A T h e y m a y h ave gone out? Yes. P a r t o f t h e f e e s m a y w e l l h a v e g o n e out. 11 not certain but 12 c o n c e r n e d m o r e t h a n m y s e l f a n d Mr. 13 that stage this was quite a large practice. 14 t h i n k it w a s a q u e s t i o n o f i n v e s t i n g t h e fee s. 15 w o u l d n ' t be a b l e to do that. 16 sure came from profits mad e 17 f a i r l y s u b s t a n t i a l h o u s e s w i t h la n d s . I am I t h i n k in m o s t c a s e s as t h e f e e s Stephenson. At I don't We M o s t of t h e m o n e y I a m from selling three 18 85 Q H o w m u c h w e r e t h e y do yo u know? 19 A I c a n ' t r e m e m b e r at t h i s s t a g e . 20 86 Q 21 A 22 87 Q 23 A Have you checked? E m . ..(INTERJECTION). Have you checked since? No, I haven't but they were quite large houses. We 24 w e r e a l s o i n v o l v e d i n a n u m b e r of o t h e r s i t e s a n d I 25 a m t r y i n g to a g a i n r e m e m b e r p r e c i s e l y w h i c h s i t e s we 26 w e r e i n v o l v e d in. 27 the d e v e l o p m e n t of an o f f i c e b l o c k in B r i d e Street, 28 w h i c h w a s s o l d o n t o an i n s u r a n c e c o m p a n y a n d t h e r e 29 w a s a c o n s i d e r a b l e p r o f i t m a d e in tha t . W e w e r e u l t i m a t e l y i n v o l v e d in 1 88 Q 2 3 Right. T h e s e p r o f i t s w e n t out to the Cayman Islands? A Well, I a m n o t c e r t a i n a b o u t th o s e , 4 insurance company, 5 t h e y w e r e p o s s i b l y l a t e r t h a n tha t. 6 89 Q 7 A 8 90 Q 9 10 b e cause m y m e m o r y tells me that Yes? What date was that letter? Yes. I t h i n k t h e y w e r e later. I w a n t y o u t o ge t b a c k to t h e t i m e w h e n y o u w e r e . . . (INTERJECTION)? A Yes, I m e a n t h e -- I t h i n k t h e C a y m a n I s l a n d t h i n g 11 was 12 B ride Street. 13 about the 91 Q 14 s e t u p b e f o r e w e s o l d t h e o f f i c e s in H o w m u c h m o n e y w a s s e n t o u t t o it i n i t i a l l y d o y o u remember? 15 A 16 92 Q 17 A 18 93 Q 19 A 20 94 Q 21 A 22 95 Q 23 A I am not quite certain. I ...(INTERJECTION). I m e a n d o in g the b est you can? I h a v e no idea bu t I a m s u r e it w a s s u b s t a n t i a l . W h a t -- a r e w e t a l k i n g a b o u t £ 1 0 0 , 0 0 0 ? I w o u l d s a y so. Yes? Yes . Initially? I am guessing but I can't remember. This was part 24 of a p a r c e l of a lot of o t h e r f i n a n c i a l 25 undertakings. 26 96 Q 27 A 28 29 Yes? A n d I w o u l d h a v e s e e n it as p a r t o f a l o t o f o t h e r dealings. 97 Q If w e c o u l d g e t it t h i s way: 18 We know from the 1 document, 2 £147,000 there? 3 Yes . 4 98 Q 5 A 6 99 Q 7 I h a v e j u s t g i v e n you, that t here was In 1 9 7 7 ? Yes . Ho w m u c h of that w o u l d have b e e n i n i t i a l l y there? How much w a s . . . (INTERJECTION)? 8 A 9 100 Q 10 A 11 101 Q 12 A 13 102 Q 14 A 15 103 Q 16 I a m s u r e m o s t o f it was. Initially? Yes . It w a s p u t o u t t h e r e ? Yes . Wa s t h a t in the e a r l y 1970s then? Yes . D i d yo u r e t u r n the i n t e r e s t that t h a t e a r n e d to y o u r i n c o m e t a x a u t h o r i t i e s h e r e in I r e l a n d ? 17 A No, 18 104 Q No. 19 A No, 20 105 Q 21 b u t I p r e s u m e d Mr. However, your personal income tax? I d o n ' t t h i n k so. own personal A 23 106 Q 24 A Yes . 25 107 Q Yes ? 26 A 27 108 Q 28 T r a y n o r or h i s f i r m w o u l d . H a d you an a c c o u n t a n t y o u r s e l f l o o k i n g after your 22 29 that W e h a d Mr. income tax? Traynor's f o r m e r firm. Haughey Boland? A n d u l t i m a t e l y t h i s m a n C h r i s Dodd. However, at t h i s t i m e i n t h e e a r l y 1 9 7 0 's w h e n t h i s deposit was made you had Haughey Boland? A 1 1 0 9 Q. 2 J u s t t o m a k e cl e a r , j u s t so w e c a n u n d e r s t a n d it, t h e d e p o s i t w a s in y o u r n am e , 3 A. 4 110 Q. 5 A. 6 111 Q. w a s it n o t ? Yes. Arthur Gibney? Yes. However, then w ould that not have been your 7 r e s p o n s i b i l i t y t o r e t u r n t h a t p a r t i c u l a r i n t e r e s t on 8 t h a t p a r t i c u l a r d e p o s i t to y o u r r e v e n u e a u t h o r i t i e s 9 here in Dublin? 10 A. 11 112 Q. 12 A. 13 14 Y o u d i d n o t do t h a t ? I a m n o t c e r t a i n w h e t h e r I d i d o r not. have. 113 Q. 15 16 Yes. I am not quite certain. However, s u r e l y y o u w o u l d r e m e m b e r or n o t w h e t h e r or not you r e t u r n e d this A. I m a y not I am not certain. for income tax pur p o s e s ? I am sorry but I would have 17 p r e s u m e d that Haughey Boland w ould have known about 18 it. 19 114 Q. 20 A. 21 115 Q. 22 A. 23 1 1 6 Q. 24 W o u l d you like time to m a k e ...(I N T E R J E C T I O N ) ? Yes, yes. Enquiries with the Revenue authorities? Yes, yes. A s t o w h e t h e r or n o t y o u r e t u r n e d t h i s for income tax? 25 A. 26 117 Q. 27 Yes. There was this substantial s u m of m o n e y in the Cayman deposit? 28 A. 29 118 Q. Yes. D i d y o u h a v e a n a r r a n g e m e n t w i t h Mr. Traynor by 1 which you could obtain payment, 2 m o n e y in the Ca y m a n Islands? 3 A. 4 5 cash , from this N o t i n t h i s p a r t i c u l a r -- i n t h e c a s e of t h i s parti c u l a r account. 1 1 9 Q. Does that m e a n that you did not take any payments f r o m it? 6 7 A. No, 8 Q. Y o u t o o k no p a y m e n t 9 A. No. 10 Q. Right. 11 A. No. 12 Q. ? At all ■ 13 A. No. 14 Q. D u r i n g t h e 1 9 7 0 ' s? 15 A. No. 16 Q. So. 17 A. Not to m y k n o w l e d g e 18 Q. R e a i i y t h e n w h a t we a r e t a l k i n g I t o o k no p a y m e n t •• p (I N T E R J E C T I O N ) ■ sum that was paid, 20 Islands? A. 22 1 2 6 Q. 23 A. 24 127 Q. f r o m i t? Did you add to i t ? 19 21 f r o m it. w hich you left in the Cayman Yes. On deposit? Yes. Y ou do not know w h e t h e r or not there was a trust? 25 Y o u t h i n k t h e r e w a s o r m a y h a v e b e e n a s e t up, 26 that the position? 27 A. 28 128 Q. 29 Yes. This m a y have be e n trust funds? is 1 129 Q 2 In w h i c h y o u h a d -- w i t h w h i c h y o u c o u l d d r a w o n if you wanted? 3 A 4 130 Q I p r e s u m e so, yes. In f a c t y o u d i d d r a w on it b e c a u s e y o u t r a n s f e r r e d 5 t h e w h o l e lo t b a c k t o D u b l i n t o y o u r o w n 6 p e r sonal...(INTERJECTION)? 7 A 8 131 Q 9 A 10 132 Q 11 A 12 133 Q Yes . Did you not? Yes . Y o u h a d f u l l c o n t r o l o v e r it? Yes . Yes. T h e r e is a r e f e r e n c e in t h e p a p e r s t o G e m i n i , 13 a firm called Gemini, 14 is it? 15 A I am not certain. a company called Gemini. What I have r e f e r e n c e s to several 16 companies here and I can't recollect pr e c i s e l y what 17 t h e y w e r e b u t t h e y -- e a c h o n e of them , 18 r e l a t e d to a d i f f e r e n t site. 19 134 Q W e r e t h e y c o m p a n i e s in I r e l a n d or c o u l d t h e y h a v e been the company that was m a n a g i n g your trust 20 21 A 22 135 Q 23 A 24 136 Q I am h o n e s t l y not certain. Y o u do not know? No. I w a n t y o u to l o o k at a l e t t e r o f t h e 25 1 4 t h O c t o b e r 1976. 26 documents. 27 Mr. 28 29 I think, A Yes, Gibney It is in t a b t h r e e o f o u r I t h i n k it is a l s o in y o u r f i l e ( E x h i b i t 2)? I h a v e n o t i c e d t ha t . T h i s w a s a time , I th i n k , 22 there were financial funds? 1 2 Yes . 3 138 Q 4 A 5 139 Q I t h i n k i n v o l v e d at t h i s t i m e ? Yes . I w o u l d l i k e y o u t o l o o k at t h e l e t t e r of t h e 14th O c tober 1976? 6 7 A 8 140 Q Yes . Do y o u se e it b e g i n s : 9 "We r e f e r t o t h e f a c i l i t y l e t t e r d a t e d 2 8 t h S e p t e m b e r 197 6, a d d r e s s e d t o y o u b y us. We have been informed by Guinness Mahon Cayman Trust Limited that the y will carry out your i n s t r u c t i o n s in t h e f o l l o w i n g r e s p e c t : 1. Existing hypothecation agreements r e l a t i n g to C a l l D e p o s i t s m a d e w i t h them will be cancelled..." 10 11 12 13 14 15 Do yo u see t hat? 16 A 17 141 Q 18 A 19 142 Q Yes . What were they? T h e y m u s t r e f e r to t h i s s u m h er e . No, no, I am talking about the "existing 20 h y p o t h e c a t i o n agree m e n t s r e l a t i n g to Call Deposits" 21 w i t h t h em . 22 Cayman Trust Limited by which you hypothecated, 23 g a v e as s e c u r i t y , 24 tell me about them? 25 A You had agreements with Guinness Mahon these deposits. I a m s o r r y I a m a b i t c o n f u s e d a b o u t th i s . 26 W e l l . . . (INTERJECTION). 27 MR. W A L K E R : 28 29 I w a n t y o u to M a y b e if I c o u l d j u s t . . . (INTERJECTION) you 1 2 144 Q MR. JUSTICE COSTELLO: 3 Just let the w i t n e s s tell me. 4 Perhaps, it is t h e w o r d i n g y o u do n o t u n d e r s t a n d ? 5 A 6 145 Q 7 A 8 146 Q 9 A 10 147 Q Yes, I t h i n k it is. Hypothecation agreements, is t h a t it? Yes . Do you u n d e r s t a n d what t h e y are? Not clearly. I w i l l p u t it t h i s w a y t o you: Did you have 11 a g r e e m e n t s w i t h t h e B a n k o u t in C a y m a n b y w h i c h t h e y 12 lent you m o n e y or your firm money? 13 A 14 148 Q 15 A 16 149 Q 17 Not to m y knowledge. Not to your k n owledge? No. I see. Then : " . . . t h e f u n d s so d e p o s i t e d w i t h t h e m will be hyp o t h e c a t e d against your person loan account." 18 19 20 T h e n if w e go b a c k t h e n to t h e 2 8 t h S e p t e m b e r . 21 y o u g o t t h a t l e t t e r t h e r e Mr. 22 3 ) (Same H a n d e d ) ? 23 A 24 150 Q 25 A 26 151 Q Gibney Have (Exhibit Yes . £142,000? Yes . T h a t l e t t e r w a s a f a c i l i t y l e t t e r i n r e l a t i o n to 27 £ 1 4 2 , 0 0 0 odd. 28 t h a t b u t t h e s e c u r i t y t h e n w a s t h e s e -- w a s t h e s u m s 29 that you h a d on deposit? T h e r e w a s n o s e c u r i t y m e n t i o n e d in 1 2 152 Q 3 W o u l d y o u l o o k at t h e l e t t e r a g a i n of t h e O c tober 1976 4 A 5 153 Q 6 A 7 154 Q 14th ( E x h i b i t 2 )? Yes . Do y o u se e p a r a g r a p h t h r e e ? Yes . It re a d s : " £ 2 0 , 0 0 0 is t o b e t r a n s f e r r e d t o o u r o r d e r in c o n n e c t i o n w i t h G e m i n i . " 8 9 Do y o u r e m e m b e r t h a t ? 10 11 A Do y o u k n o w w h a t t h a t i s? I a m t r y i n g to r e m e m b e r w h a t it is. 12 a d e b t I had, 13 t h a t w e w e r e i n v o l v e d in. 14 o w e d a lot of m o n e y to G u i n n e s s 15 a n u m b e r o f sit e s . 16 155 Q 17 A 18 156 Q 19 A It is o b v i o u s l y p r o b a b l y r e l a t i n g to one of the sites At this stage, 1976, we & M a h o n r e l a t i n g to Yes ? Now, I a m g u e s s i n g as to t h e i d e n t i t y of G e m i n i . However, Yes. y o u t h i n k it w a s a n I r i s h c o m p a n y ? I think I was subsequently involved, after the 20 consortium, 21 s u b s e q u e n t l y i n v o l v e d w i t h Mr. 22 n u m b e r of o t h e r p e o p l e in t h e p u r c h a s e of a n o t h e r 23 v e r y l a r g e site, 24 157 Q 25 A 26 158 Q 27 A t h e F i t z w i l l i a m c o n s o r t i u m -- I w a s Stephenson and a The S outh C o u n t y Hotel. Yes ? T h e r e w a s l a r g e b o r r o w i n g s o n that . Yes? A n d it e n d e d u p d i s a s t r o u s l y b u t it c o u l d b e t h a t or 28 a n u m b e r of o t h e r s maller sites we were i n v o l v e d 29 w i t h at t h e t i me. 1 159 Q Yes. C o u l d I r e f e r you to a letter, 2 i n t e r na l m e m o rather, 3 p a g e 46 o f t h e f i l e 4 A 5 160 Q 6 A 7 161 Q it is an of the 18th M a y 1976? It is ( E x h i b i t 4 ) (Same H a n d e d ) ? T h a n k you. T h i s as f r o m J D T . Traynor, This T h a t is f r o m Mr. Traynor? yes. is a n i n t e r n a l m e m o . It is s t r i c t l y p r i v a t e and confidential? 8 9 A 10 162 Q 11 A 12 163 Q Yes . It is t h e 1 8 t h M a y 1 9 7 6 ? Yes . It is t a l k i n g a b o u t t h e i n d e b t e d n e s s Mr. 13 14 A 15 164 Q 16 of y o u a n d Stephenson? Yes . It says: "A p r e s e n t b o r r o w i n g s b y S a m on his p e r s o n a l accout, A r t h u r on his p e r s o n a l a c c o u n t ... ." 17 18 19 A 20 165 Q Yes . Then: "I n a d d i t i o n G u i n n e s s & M a h o n L o n d o n h a s g u a r a n t e e d £ 6 5 , 0 0 0 to t h e B a n k i n Dublin. S a m S t e p h e n s o n is g u a r a n t e e d A voca Limited. The total involv e m e n t would therefore be..." 21 22 23 24 25 26 A n d it g i v e s t h e t o t a l i n v o l v e m e n t as p e r s c h e d u l e ? A Yes . 27 If y o u c o u l d t u r n o v e r t w o p a g e s y o u w i l l s e e t h e 28 s c h e d u l e and, 29 your debt was £102,000? Mr. Gibney, on your p e r s o n a l account 1 Then: 2 3 "Ailesbury Securities. G i b n e y ..." Stephenson & 4 5 A n d the total was £2 3 6 , 9 9 1 . 6 4 ? 6 A 7 168 Q 8 A 9 169 Q Yes . That was in M a y 1976? Yes . W o u l d you just see u n d e r n e a t h that t o t a l t h e r e on 10 the first p a g e of the d o c u m e n t of the 11 "Against this there w ould be trust funds totalling £332,376, m a k i n g a s h o r t f a l l of £ 2 5 6 , 0 3 8 . " 12 1 8 t h May: 13 14 Do y o u se e t h a t t h e y r e f e r to t r u s t f u n d s ? 15 A 16 170 Q 17 A 18 Yes . W h a t is r e f e r e n c e t h e r e to, Well, do y o u k n o w ? o b v i o u s l y it is t h e s e f u n d s i n t h e C a y m a n Islands. 19 171 Q 20 A 21 172 Q 22 A 23 173 Q 24 Yes? Yes . T h e y r e f e r to t h e m as t r u s t funds? Yes . It l o o k s t h e n as i f t h e y m u s t h a v e e s t a b l i s h e d a trust? 25 A Yes, 26 174 Q Yes. 27 Mr. 28 A 29 175 Q yes. The funds in the C a y m a n Is l a n d s are y o urs an d Stephensons? Yes . I see. Mr. Gibney, 27 I w a n t to r e f e r yo u n o w to y o u r 1 2 A. 3 1 7 6 Q. 4 Yes. D o y o u se e o n t h e f i r s t p a g e , the e n d of the first page : 5 "Our c l i e n t d i d h a v e C a y m a n d e p o s i t s in this p e r i o d w h i c h r e l a t e d to his property development activities"? 6 7 8 A. 9 177 Q. 10 A. Yes. Is t h a t w h a t y o u h a v e b e e n t e l l i n g u s ? T h a t is w h a t I believed. 11 in your e s t i mation, 12 established. 13 178 Q. 14 A. I m e a n y o u a r e t e l l i n g me, clearly there was a trust I a m b e g i n n i n g to se e t h a t now. Yes? B u t I m e a n I d i d n ' t r e a l i z e -- I h a d s o m e h o w g o t t h e 15 i d e a t h a t a t r u s t w a s s o m e t h i n g t h a t w o u l d be 16 outside m y control. 17 1 7 9 Q. However, t h a t r e a l l y is n o t t h e p o i n t I am making 18 b e c a u s e it is q u i t e c l e a r t h a t t h i s d e p o s i t w a s 19 completely under your control. 20 u p b y as a t r u s t o r n o t I a m n o t c o n c e r n e d w i t h at 21 the moment? 22 A. 23 180 Q. 24 W h e t h e r it w a s set Yes. It w o u l d a p p e a r y o u h a v e a g r e e d t h a t t h e r e p r o b a b l y was a trust? 25 A. 26 181 Q. 27 Yes, yes. However, it w a s a t r u s t i n s u c h a f o r m t h a t y o u h a d c o m p l e t e c o n t r o l o v e r i t? 28 A. 29 182 Q. Yes. " W h i c h r e l a t e d to p r o p e r t y d e v e l o p m e n t 28 a c t i v i t i e s ." 1 2 3 What does that mean? 4 Well, 5 183 Q 6 A 7 184 Q 8 A 9 185 Q 10 A 11 186 Q the m o n e y accrued from profits. From property? M a d e f r o m b u y i n g sites to develop. Yes? A n d s e l l i n g the sites. Yes ? O r a t t e m p t i n g to d e v e l o p t h e m a n d s e l l i n g t h e s i t e s . Yes. If y o u w o u l d j u s t t u r n o v e r t h e p a g e 12 t h e n Mr. 13 occurred? 14 A 15 187 Q Gibney. Y o u r e f e r to t h e d i f f i c u l t i e s t h a t Yes . T h e n y o u go o n t o say: 16 "At t h i s s t a t e o u r c l i e n t ' s C a y m a n d e p o s i t s w e r e r e p a t r i a t e d to p a y off these Irish loans"? 17 18 19 A 20 188 Q Is t h a t w h a t o c c u r r e d ? 21 A T h a t is w h a t o c c u r r e d . 22 189 Q 23 A 24 190 Q Yes . Yes? Yes . Y o u t h e n r e f e r to t h e s e c o n v e r s a t i o n s y o u h a d w i t h 25 Mr. 26 on t h e n in the n e x t p a r a g r a p h : 27 28 29 T r a y n o r a n d Mr. Reid about trusts. " B y t h e m i d 1 9 7 0 's t h e e n t i r e or o u r Client's assets had been consumed by h i s l i a b i l i t i e s d u e t o t h e B a n k s on l o a n s ..." T h e n y o u go 1 2 "...At this time in the late 1970's Mr. T r a y n o r a d v i s e d Mr. G i b n e y t h a t i n r e c o g n i t i o n of h i s c o - o p e r a t i o n i n s e t t l i n g h i s i n d e b t e d n e s s , Mr. T r a y n o r w o u l d se t a s i d e a s u m o f a p p r o x i m a t e l y £25,000. " 3 4 5 6 7 T e l l m e a b o u t t h a t Mr. 8 9 A Yes. Gibney? It is a l i t t l e b i t m o r e c o m p l i c a t e d t h a n that . 10 W h e n I f ound m y s e l f in this s i t u a t i o n I h a d also 11 f o u n d t h a t m y s e l f a n d Mr. 12 o n i n t e r m s of w h a t w e b o t h w a n t e d t o do. 13 192 Q 14 A Stephenson weren't getting Yes? He w a n t e d t o c o n t i n u e h i s i n v o l v e m e n t i n p r o p e r t y 15 d e v e l o p m e n t a n d he w a n t e d to d e v e l o p the f i r m in a 16 w a y t h a t I d i s a g r e e d wi t h . 17 193 Q 18 A Yes ? W e f e l l out. W e d i d n ' t n a v e a n a s t y f a l l i n g out. 19 W e f e l l o u t a n d w e d e c i d e d w e w e r e -- I w a s g o i n g to 20 leave the partnership. 21 accrued was when Guinness 22 m o n e y b a c k -- I t h i n k G u i n n e s s 23 in d i f f i c u l t i e s . 24 p r o p e r t y d e v e lopment other than the ones they were 25 i n v o l v e d i n w i t h us. 26 difficulties there because 27 p e o p l e h a d t o le a v e . 28 Yes? 29 A One of the p r o b l e m s that & M a h o n l o o k e d for their & Mahon were probably T h e y h a d b e e n i n v o l v e d in a lot of I think there were I t h i n k t w o of t h e s e n i o r I t h i n k D e s m o n d T r a y n o r was r e t a i n e d b e c a u s e he was 30 1 p r o b a b l y not t e r r i b l y involved. He w a s m o r e 2 i n v o l v e d in t h e f i n a n c i a l e n d o f it r a t h e r t h a n t h e 3 s o r t of p r o p e r t y d e v e l o p m e n t end. 4 Mr. 5 treated properly by Guinness 6 f i g u r e s a n d d i s p u t e d t h e f a c t t h a t he o w n e d t h i s 7 money. 8 w a n t e d to s t a r t a n e w p r a c t i c e a w a y f r o m p r o p e r t y . 9 I w a n t e d to get a w a y f r o m p r o p e r t y d e v e l o p m e n t an d At this stage S t e p h e n s o n r e a l l y felt that we were not b e i n g & Mahon. He d i s p u t e d I w a n t e d to g e t s h u t o f t h e w h o l e t h i n g . start a small practice. 10 11 195 Q. 12 A. Yes? A n d one of the p r o b l em s I e n c o u n t e r e d w a s t h a t in 13 the settlement, 14 Wexford, 15 h o me , 16 question. 17 t h e D e e d s o f al l m y p r o p e r t i e s b u t h e w a n t e d t h e 18 D eeds of m y home. 19 h i m t h e D e e d s o f h i s h o m e a n d it e n d e d u p w i t h m y 20 M e w s b e i n g m o r t g a g e d to d e f r a y t h e i n d e b t e d n e s s to 21 C i t y B a nk. 22 1 9 6 Q. Yes? 23 A. Now, a f t e r I h a d s o l d p r o p e r t y in s o l d p r o p e r t y in C lontarf, was that my w h i c h w a s a M e w s in L e s s o n Pl a c e , Mr. at t h a t Sam S t e p h e n s o n r e f u s e d to give s t a g e I t h i n k -- a l t h o u g h it s a y s £ 6 5 , 0 0 0 h er e , 25 i n d o c u m e n t s t h e i n d e b t e d n e s s w a s le s s . 26 about £35,000. 27 197 Q. 28 A. w a s a l s o in T r a y n o r d e m a n d e d t h a t -- t h e y h a d 24 29 I from my memory and from what I perused It w a s Yes? At this stage I was m o r e or less bankrupt. I was l e a v i n g a large firm and s t a r t i n g up a v e r y small 1 firm w i t h no a ssets and m y solicitor, w h o at t h a t 2 s t a g e w a s t h e l a t e T e r a n c e D oy le , 3 think you have been treated very unfairly." said ; "Look, I 4 5 M y wife was p a r t i c u l a r l y a n n o y e d a bout this a n d she 6 h a d b e e n d e a l i n g w i t h T e r a n c e Doyle, 7 b e h a l f t han mine, a n y w a y he went a nd saw 8 Mr. said: 9 Traynor. He a nd m o r e on her "I t h i n k m y c l i e n t h a s b e e n t r e a t e d very unfairly. He h a s a c c e d e d t o a l l your demands. He h a s g i v e n y o u e v e r y t h i n g h e has. You have now taken his home and put h i m into a ver y d i f f i c u l t p o s i t i o n b e c a u s e h e is f a l l i n g o u t w i t h Mr. S t e p h e n s o n . Mr. S t e p h e n s o n owes money, w h i c h he m a y not pay, he is d i s p u t i n g i t . " 10 11 12 13 14 15 And there were solicitors letters going from 16 Mr. S t e p h e n s o n to Mr. T r a y n o r t h r e a t e n i n g su it s. 17 18 He m a d e t h e p o i n t t h a t I w a s i n a v e r y a w k w a r d 19 p o s i t i o n a n d Mr. 20 21 22 T r a y n o r said ; "Yes, I a g r e e . Mr. G i b n e y h a s b e e n very co-operative. He h a s d o n e h i s b e s t to p a y o f f t h e s t u f f . I a gree his M e w s is in d a n g e r b e c a u s e Mr. S t e p h e n s o n m a y n o t p a y t h e r e m a i n d e r of t h i s d e b t ." 23 24 He c a l l e d m e i n a n d h e said, 25 d o n ' t t h i n k I c a n c o v e r t h e a m o u n t of £ 2 5 , 0 0 0 " o r 26 w h a t e v e r t h e a m o u n t was. 27 t h at , 28 s o m e t h i n g out of the a ccount £ 2 0 , 0 0 0 / £ 2 5 , 000." 29 said, t h a t w a s owe d, " L o o k , " he said, "I It w a s s o m e t h i n g l i k e b u t h e said ; "I w i l l set a s i d e He " J u s t in c a s e y o u r M e w s -- y o u l o s e y o u r M e w s " 1 as a s e c u r i t y . 2 t o h e r e. 3 198 Q 4 A 5 199 Q 6 A 7 20 0 Q 8 A 9 20 1 Q 10 A 202 Q 13 14 I am not following? I k n o w it is a b i t . . . ( I N T E R J E C T I O N ) . W h a t . . . (INTERJECTION)? I a m sor r y . No, just l i s t e n to me? Yes . W h a t a c c o u n t was he s e t t i n g a s i d e the £ 2 5 , 0 0 0 From the m o n e y that we h a d p a i d back. from? The debt that we h a d p a i d back. 11 12 T h a t is t h e f i g u r e t h a t is r e f e r r e d No. What account? in G u i n n e s s A Well, Was this an ac c o u n t that you had & Mahon? I h a d an a c c o u n t in G u i n n e s s 15 apart from the Cayman account. 16 Guinness 17 20 3 Q 18 A & Mahon quite I h a d a n a c c o u n t in & Mahon b u t . ..(INTERJECTION). W h e r e w a s t h e £ 2 5 , 0 0 0 b e i n g se t a s i d e f r o m ? I'm not certain. I m e a n I w a s so g l a d t o be 19 r e a s s u r e d at t h e t i me . Mr. 20 extent doesn't, e x p l a i n a lot of the t h i n g s 21 he did. 22 accepted...(INTERJECTION). 23 204 Q 24 A didn't, T ra y n o r to a great I h a d m o r e or l e s s o v e r t h e y e a r s Did you u n d e r s t a n d that you were g e tting £25,000? Well, what I u n d e r s t o o d at t h e t i m e w a s t h a t he 25 w o u l d t r y t o b a l a n c e -- if a n y t h i n g h a p p e n e d m y M e w s 26 t h i s £ 2 5 , 0 0 0 w o u l d go a g a i n s t 27 w h a t e v e r w a s r e m a i n i n g o f t h e d e b t so t h a t I w o u l d 28 h o l d m y M ews a nd I u n d e r s t o o d the £ 2 5 , 0 0 0 w o u l d be 29 mine . it. It w o u l d r e p a y 1 20 5 Q 2 A Yes. I don't k n o w w h e r e it c a m e from . It c a m e 3 o b v i o u s l y f r o m p a r t of t h e m o n e y w e p a i d in. 4 I ...(INTERJECTION). 5 206 Q 6 A 7 207 Q D o e s it n o t l o o k as i f . . . ( I N T E R J E C T I O N ) ? He w a s d o i n g m e a f a v o u r . However, d o e s it n o t l o o k as i f it w a s p a r t o f t h e 8 s u m t h a t y o u h a d p a i d t o d i s c h a r g e t h e d eb t , 9 g o i n g t o s a y y o u h a d -- h e w a s he was k e e p i n g £ 2 5 , 0 0 0 of that for you? 10 11 A 12 208 Q 13 A 14 209 Q 15 A 16 21 0 Q 17 A 18 21 1 Q 19 A 20 212 Q 21 A It l o o k s l i k e that , Is t h a t w h a t it was, yes. do y o u t h i n k ? I t h i n k it w a s . You had £25,000? Yes . T h a t Mr. T r a y n o r was l o o k i n g a fter for you? Yes . W h e n was that do yo u t h i n k ? That was 1977. Is t h a t t h e t i m e o f t h i s ? It w a s j u s t a f t e r w e h a d p a i d b a c k t h a t m o n e y . 22 After, 23 I had started off a new small practice. 24 21 3 Q 25 A 26 214 Q 27 A Yes, 28 21 5 Q Yes? 29 A yes. I had a l ready left S t e p h e n s o n Gibney. W h e n was that? 19 77 . It w a s in 1 9 7 7 t h a t t h i s h a p p e n e d ? 1 977. Yes, I t h i n k 1977. C e r t a i n l y e i t h e r l a t e 1 9 7 6 o r m i d 1977. 34 Sometime 1 2 216 Q 3 A 4 217 Q Yes . However, j u s t i n r e l a t i o n t o t h e p e r i o d it is 5 s o m e t i m e late 1976 e a r l y 1977 a n d you can i d e n t i f y 6 that time? 7 A 8 218 Q 9 A 11 219 Q 12 A 13 22 0 Q 14 A 16 22 1 Q 19 20 Yes . Y o u r s p l i t u p w i t h Mr. Exactly, exactly, Stephenson? exactly. W o u l d y o u j u s t l o o k o v e r at t h e n e x t p a g e , at p a g e three? 15 18 B e c a u s e it w a s t h e t i m e o f y o u r f i n a n c i a l difficulties ? 10 17 Yes . Yes . Do y o u se e b & C: "Our client can not give any further i n f o r m a t i o n o r d o c u m e n t a t i o n in r e l a t i o n to t h e f i r s t a c c o u n t o t h e r t h a n as se t o u t a b o v e . Our Client c a n n o t b e s p e c i f i c as t o w h e n t h e s e c o n d a c c o u n t w a s se t u p b u t it a p p e a r s to h a v e b e e n s o m e t i m e i n t h e m i d 1 9 8 0 ' s ." 21 22 W h a t is t h a t ? 23 Well, 24 S t e p h e n s o n w a s p a y i n g b a c k -- h e d i d u l t i m a t e l y p a y 25 b a c k all the m o n e y o w e d to C i t y Bank. 26 1 9 7 7 t h e m o n e y -- I t h i n k t h e m o n e y w a s p u t a g a i n s t 27 the sort of indebtedness. 28 put into an account 29 t o o k him, t h a t is a n a t t e m p t to e x p l a i n t h a t w h i l e - ­ I think, If it w a s at I p r e s u m e the m o n e y was f o r m e i n t h e e a r l y 1 9 8 0 's. four or five years to p a y b a c k It 1 2 222 Q However, I a m t a l k i n g a b o u t a n a g r e e m e n t m a d e in 3 19 77 b y w h i c h y o u u n d e r s t o o d y o u h a d £ 2 5 , 0 0 0 4 a v a i l a b l e to y o u ? 5 A 6 22 3 Q 7 A 8 224 Q 9 A Yes . In a n a c c o u n t t h a t Mr. Well, by t h e . ..(INTERJECTION). W h y a r e y o u r e f e r r i n g t h e n to t h e m i d 1 9 8 0 's? B y 1980, what I a m t r y i n g t o e x p l a i n is t h a t I f e l t 10 that the money, 11 c o u l d n' t get the money. 12 22 5 Q 13 A 14 226 Q 15 A 16 227 Q 17 T r a y n o r was l o o k i n g after? I h a d no c ontrol over the money. I Yes ? B e c a u s e Mr. S t e p h e n s o n was p a y i n g off debts. Yes? T h a t I p r e s u m e d b y 1 9 8 0 h e h a d h i s d e b t s p a i d off. G o b a c k to p a g e two: " S o m e t i m e in t h e e a r l y 1 9 8 0 's Mr. T r a y n o r i n f o r m e d o u r C l i e n t t h a t t h e a m o u n t set a s i d e b y Mr. T r a y n o r / G u i n n e s s & M a h o n B a n k still existed"? 18 19 20 21 A 22 228 Q 23 A Yes . In t h e e a r l y 1 9 8 0 s y o u . . . ( I N T E R J E C T I O N ) ? Yes. Y o u s e e I d i d n ' t s e e Mr. T r a y n o r for years. 24 d i d n ' t m e e t w i t h Mr. 25 w a s b u s i l y t r y i n g t o set u p a s m a l l p r a c t i c e . 26 wasn't i n v o l v e d in p r o p e r t y d e a l i n g s or a n y t h i n g 27 el s e. I d i d n ' t m e e t Mr. 28 me . 29 Tray n o r for a long period. I I I T r a y n o r b u t he t e l e p h o n e d 1 He w a n t e d m e t o do s o m e w o r k o n h i s h o u s e b e c a u s e m y 2 previous 3 there were p r o b l e m s and he t e l e p h o n e d me a nd a sk e d 4 m e w o u l d I do s o m e -- g o o u t a n d s o r t s o m e t h i n g s 5 out in his house. 6 23 0 Q 7 A firm h a d done some w o r k on his h ouse and Yes? I w e n t ou t to h i s h o u s e a n d h e t o l d m e t he n , 8 said, 9 your n a m e " . 10 23 1 Q 11 A 12 232 Q 13 A 14 23 3 Q 15 A 16 234 Q 17 A 18 23 5 Q 20 A It is in This £25,000? Yes . That m e a n t that he h a d an ac c o u n t some w h e r e ? Yes . W h i c h was a v a i l a b l e to you? Yes . To t h e a m o u n t o f £ 2 5 , 0 0 0 p o u n d s ? Yes, a n d I w a s c o n s c i o u s o f t h i s b u t I n e v e r -- I didn't 19 see h i m f o r . . . ( I N T E R J E C T I O N ) . Yes? C e r t a i n l y I d i d n ' t se e h i m in t h e l a t e 1 9 7 0 ' s . I h a d n o r e a s o n to s e e him. 21 22 236 Q 23 A 24 Yes? A n d he r a n g m e a n d a s k e d me, as I said, t o do s o m e w o r k o n h i s h o u s e o v e r a p e r i o d of a b o u t t w o y e a r s . 25 237 Q 26 A 27 238 Q 28 29 " B y t h e w a y t h a t m o n e y is t h e r e . he Yes ? In t h e 1 9 8 0 's. If I c o u l d j u s t r e f e r y o u n o w to t h e d o c u m e n t s t h a t you produced? A I a m not q u i t e c e r t a i n when. 1 239 Q You pr o d u c e d the "Ansbacher" Limited accounts and 2 the Hamilton Ross accounts. 3 account. 4 A 5 24 0 Q 6 A 7 24 1 Q It is a s t a t e m e n t o f Yes . These ones? Yes . Yes. T h i s is t h e s t a t e m e n t o f a c c o u n t of 8 " A n s b a c h e r " L i m i t e d o f t h e 1st O c t o b e r 1 9 9 2 a n d it 9 is £ 9 8 , 4 3 1 . 9 6 10 A 11 242 Q (Exhibit 6)? Yes . T h e n if y o u l o o k at t h e o t h e r d o c u m e n t s t h a t y o u 12 g a v e us. 13 is 14 t h i r d p a g e is H a m i l t o n R o s s ? 15 A 16 24 3 Q 17 A 18 244 Q 19 A 20 24 5 Q 21 A 22 246 Q 23 A 25 247 Q 26 A 27 29 "Ansbacher" Limited Cayman. T h e n w e go on, the Yes . It is £ 1 0 0 , 0 0 0 t h e r e ? Yes . Then the l ater ones are all H a m i l t o n Ross? Yes . A n d it c o m e s u p t o £ 1 0 7 , 0 1 1 . 8 2 in 1 9 9 7 ? Yes . C a n y o u e x p l a i n h o w it r o s e f r o m £ 2 5 , 0 0 0 t o t h a t figure? 24 28 T h e n e x t o n e r e f e r s to t h e i n t e r e s t a n d it Well, it m u s t h a v e b e e n i n t e r e s t . Interest? I d i d n ' t p u t a n y m o n e y i n t o a n y a c c o u n t in Guinness 248 Q & M a h o n or e l s e w h e r e . W o u l d you t u r n to p a g e t h r e e of y o u r letter, statement. I t h i n k y o u h a v e it t h e r e , Mr. of your Gibney? 1 2 249 Q 3 A 4 25 0 Q 5 A 6 25 1 Q 7 Page t hree of y our stat e m e n t ( E x h i b i t 5)? Yes . Do y o u se e "D "? Yes . Then: "In r e l a t i o n to the first a c c o u n t all t r a n s a c t i o n s on the a c c o u n t were c o n d u c t e d b y Mr. T r a y n o r , w h o h a d an i n t e r e s t in the p r o p e r t y t r a n s a c t i o n s conducted by our Client." 8 9 10 11 A. 12 252 Q. Yes . " W i t h d r a w a l s i n r e l a t i o n to t h e s e c o n d account were effected by our Client c o n t a c t i n g Mr. T r a y n o r " 13 14 15 A. 16 25 3 Q. Yes . " To t h e b e s t o f o u r C l i e n t ' s recollection most withdrawals received f r o m Mr. T r a y n o r w e r e in c a s h . " 17 18 19 A. 20 254 Q. Yes . " A f t e r Mr. T r a y n o r ' s d e a t h o u r C l i e n t c o n t a c t e d Mr. T r a y n o r 's s e c r e t a r y , Ms. J o a n W i l l i a m s w h o a d v i s e d h i m t h a t he s h o u l d c o n t a c t a Mr. C o l l e r y . Our C l i e n t c o u l d n o t c o n t a c t Mr. C o l l e r y and ultimately contacted Sam Field Corbett who formerly worked in Guinness & Mahon. Money withdrawn a f t e r Mr. T r a y n o r ' s d e a t h w a s u s u a l l y i n c a s h ."? 21 22 23 24 25 26 27 A. Yes . 28 H o w o f t e n u s e d y o u g o to o b t a i n c a s h 29 f r o m Mr. Traynor? 1 A 2 256 Q 3 Not on a r e g u l a r basis. W h a t w a s t h e p u r p o s e of t h e c a s h w i t h d r a w a l s t h a t you made? 4 A 5 257 Q M o s t l y w o r k on m y house. Can you remember then how much you would have obtained from the account? 6 7 Very infrequently. A O t h e r t h a n w h a t is in t h o s e w i t h d r a w a l s t h e r e , 8 because 9 a l o n g t i m e. no, I didn't w i thdraw m o n e y from the account It w a s only, I th i n k , fo r probably over 10 the last eight or nine years that I w i t h d r a w m o n e y 11 from the account. 12 258 Q 13 A 14 15 I d o n ' t t h i n k I w i t h d r e w m o r e t h a n y o u se e i n t h o s e withdrawals. 259 Q 16 17 Tell me how mu c h you think you withdrew? No, j u s t t e l l me, apart from the documents, what can you recall? A 18 Well, I w o u l d w i t h d r a w sums like £2,000, £4,000, 19 26 0 Q 20 A 21 26 1 Q 22 A £3,000, £5,000. Small sums? T h a t t y p e o f sum. W h e r e u s e d y o u g o to w i t h d r a w t h e m ? Well, I w a s s t i l l i n t o u c h w i t h Mr. T r a y n o r at t i m e s 23 about his house. 24 t a k e me two or t h r e e days to get h o l d of h i m on the 25 t e l e p h o n e a n d I -- he w o u l d a s k me, 26 money" 27 much" 28 d a y o r so" a n d he w o u l d t e l l m e t o c o m e i n t o h i s 29 o f f i c e o r to h i s h o u s e b e c a u s e I w o u l d t e l e p h o n e him. a n d I w o u l d say, a n d he w o u l d say, "Y es ". It m i g h t "Do y o u w a n t H e w o u l d say, "How "I w i l l t e l e p h o n e y o u in a I was again 1 c o n s i s t e n t l y d o i n g odds a n d ends on his house, 2 on, 3 tw o or t h r e e t i m e s 4 262 Q. 5 A. 7 26 3 Q. 8 A. 9 264 Q. 10 A. 11 2 65 Q. 12 A. 13 2 6 6 Q. 14 A. 15 267 Q. 16 A. 17 268 Q. 18 I w a s . ..(INTERJECTION). W a s it o n l y in h i s h o u s e t h a t y o u o b t a i n e d t h e S o m e t i m e s in his house. Yes? No, sometimes in h i s o f f i c e . Where? In F i t z w i l l i a m Street. T h a t is in C e m e n t R o a d s t o n e ? Yes. U s e d y o u go i n t o R o a d s t o n e a n d g e t . . . ( I N T E R J E C T I O N ) ? Yes. Get cash? Yes, I did, yes. Did you ever get a statement, a p i e c e of p a p e r that t h e t o p h a d b e e n cu t o f f ? 19 A. 20 2 6 9 Q. 21 A. 22 27 0 Q. 23 A. 24 27 1 Q. 25 No. That was a statement o f ...(I N T E R J E C T I O N ) ? I r e c e i v e d n o s t a t e m e n t s at all. Yes? I r e c e i v e d n o d o c u m e n t a t i o n at all. T hen the m o n e y just rose t here and you just left the money there? 26 A. 27 272 Q. 29 y o u k n o w -- n o t c o n t i n u o u s o n a y e a r l y b a s i s b u t money? 6 28 not Yes. Did you return the interest income tax? from this for your 1 27 3 Q. 2 A. 3 274 Q. 4 You did not? No. W o u l d it b e p o s s i b l e t h a t y o u h a v e o t h e r d o c u m e n t s , o t h e r t h a n these, 5 A. 6 27 5 Q. 7 A. 8 2 7 6 Q. 9 A. in r e l a t i o n to the a c c o u n t ? A b s o l u t e l y not. W h e r e did you get these? I am quite certain. W h e r e did you get these from? I g o t t h o s e a f t e r p u r s u i n g Mr. Collery. It t o o k m e 10 s o m e t i m e to f i n d h i m a n d u l t i m a t e l y I a s k e d f o r a 11 m e e t i n g w i t h h i m to t r y a n d u n d e r s t a n d i n g w h a t was 12 g o i n g on and he h a n d e d m e those. 13 277 Q. 14 A. 15 278 Q. 16 A. 17 2 7 9 Q. 18 No. Did you know for example what A/A2 was on these? No. D i d h e e x p l a i n to y o u t h e r e t h e y w e r e c o d e d a c c o u n t s in G u i n n e s s 19 A. 20 28 0 Q. 21 A. 22 28 1 Q. 23 A. 24 282 Q. 25 A. 26 28 3 Q. 27 A. 28 284 Q. 29 D i d h e e x p l a i n to y o u e x a c t l y w a s w h a t g o i n g o n ? No, & Mahon? he d i d n ' t . W e l l ... ( I N T E R J E C T I O N ) ? I h a d n e ve r h e a r d of the n ame "Ansbacher". Yes? I k n e w o f a n " A n s b a c h e r " B a n k in D u b l i n . Yes? I h a d s o m e d e a l i n g s w i t h it. No, I am n o t ...(I N T E R J E C T I O N ) ? Yes. I am just w o n d e r i n g did he tell you that the y were 1 2 3 28 5 Q. 4 A. 5 2 8 6 Q. 6 A. 7 287 Q. 8 A. 9 D i d he tell yo u a n y t h i n g a b o u t that? No. N o t h i n g at a l l ? He w a s v e r y r e t i c e n t . Yes? My sole d i s c u s s i o n with h i m frankly was I had i n t e n d e d g o i n g t o see t h e R e v e n u e C o m m i s s i o n e r s a n d 10 I j u s t w a n t e d to f i n d o u t a b o u t t h e a c c o u n t so I 11 c o u l d go t o t h e R e v e n u e C o m m i s s i o n e r s . 12 he w a s a l r e a d y d e a l i n g w i t h t h e R e v e n u e 13 Commissioners himself. 14 288 Q. 15 A. 16 2 8 9 Q. 17 He t o l d m e D i d F i e l d C o r b e t t e x p l a i n to y o u w h a t h a d h a p p e n e d ? No. The p o s i t i o n t h e n was that this m o n e y was there, you o n l y d r e w b i t s o f it f r o m t i m e t o t i m e ? 18 A. 19 2 90 Q. 20 A. 21 29 1 Q. 22 A. Yes, 23 292 Q. Yes? 24 A. Yes. A n d it a c c u m u l a t e d ? Yes. In t h e w a y w e d e s c r i b e d ? a n d I o n l y d r e w it i n t h e l a t e r p o r t i o n . I d o n ' t t h i n k I d r e w a n y t h i n g in t h e 1980's. I 25 w a s n ' t in t o u c h w i t h Mr. 26 w e n t to h i m in his h o u s e a n d I r a r e l y sa w h i m u n t i l 27 t h e e n d o f 1 9 8 0 ' s then . 28 29 29 3 Q. Yes. Traynor very much until T h e n it w a s a f t e r t h a t t h e n t h a t y o u -- d i d I 1 2 Well, 3 six months. 4 294 Q 5 6 as r e g u l a r l y as t h o s e a c c o u n t s not e v er y T h e s e a c c o u n t s do not s h o w a n y t h i n g f r o m before A show, Well, 1992? I cannot swear that I d i d n ' t go t o h i m b e f o r e 7 th e n. 8 a m n o t c e r t a i n o f t h a t f r a n k l y b u t I d i d n ' t go t h a t 9 frequently. 10 29 5 Q 11 A I m a y h a v e g o n e to h i m in t h e l a t e 1 9 8 0 's. D i d y o u e v e r y h e a r of A m i e n s No. No, I Securities? a n d h a v i n g s a i d t h a t t h e r e w e r e so m a n y 12 c o mpanies g oing thro u g h sort of m y life p a r t i c u l a r l y 13 in the e a r ly stages, 14 seen the w ords 15 hundreds 16 don't recollect 17 296 Q i n t h e 1 9 7 0 's, t h a t I m a y h a v e "Amiens Securities" but there were of c o m p a n i e s a n d I m a y h a v e s e e n it b u t it. I don't k n o w w h a t it m e a n s . It w a s a c o m p a n y w h i c h h a d a n a c c o u n t in 18 Guinness 19 Mr. 20 in G u i n n e s s 21 j u s t w o n d e r i n g i f y o u can, 22 recollect 23 payment 24 7 t h N o v e m b e r 1986, 25 C an you r e m e m b e r sums like that? 26 A I & Mahon from which payments were made by T r a y n o r to p e o p l e w h o h a d a c c o u n t s & Mahon, who had coded accounts. I am from these records, -- o u r i n f o r m a t i o n is t h a t t h e r e w a s a from A m i e n s S e c u r i t i e s on the A Gibney & Partners, of £6,000. A r t h u r G i b n e y & Partners h a d an account w ith 27 Guinness 28 Mahon a n d . ..(INTERJECTION). 29 No. No, & Mahon. We b o r r o w e d m o n e y from Guinn e s s I am t a l k i n g a b o u t m o n e y b e e n p a i d to you 44 & 1 2 I am a b s o l u t e l y quite c e r t a i n that no m o n e y was p a i d 3 to me o t h e r t h a n m o n e y I w e n t in a n d a s k e d 4 Mr. T r a y n o r for. Mr. T r a y n o r for? 5 298 Q 6 A 7 Which I g o t . f r o m Mr. 8 299 Q 9 A 10 30 0 Q As I s a y to t h e b e s t o f m y k n o w l e d g e T r a y n o r i n c a s h form. C o u l d it h a v e b e e n s u m o f £ 6 , 0 0 0 ? No, I d o n ' t t h i n k so. T h e r e is a n o t h e r d o c u m e n t , a n o t h e r record, w h i c h we 11 h a v e a n d p e r h a p s y o u m a y b e a b l e t o a s s i s t us o n it, 12 of F e b r u a r y 1985, 13 A 14 30 1 Q Mr. A. Gibney, £12,000? No. MR. W A L K E R : These are w i t h d r a w a l s 15 from the A m i e n account? 16 MR. JUSTICE COSTELLO: The A m i e n account, 17 Payments yes. from the Amien 18 a c c o u n t a n d t h e p a y e e is Mr. 19 MR. W A L K E R : Yes. MR. The records also show a 20 302 Q JUSTICE COSTELLO: 21 l o d g e me n t to this A m i e n account 22 23 Gibney. A 24 f r o m t h e A G i b n e y a c c o u n t of £ 8 , 3 5 0 . 8 9 ? I a m a w a r e o f h a v i n g a l e t t e r a b o u t this , w h i c h was an i n q u i r y f r o m the Tribunal. 25 30 3 Q 26 A 27 304 Q 28 A 29 30 5 Q Yes ? A n d a g a i n I d o n ' t u n d e r s t a n d it. Y o u d o n o t r e m e m b e r i t? A n d I d o n ' t u n d e r s t a n d it. Yes. V e r y well. Mr. 45 Gibney, I do not t h i n k I have 1 a n y f u r t h e r q u e s t i o n s t o you. 2 j u s t t o l o o k at m y n o t e s . 3 o p p o r t u n i t y to h a v e a c o f f e e b r e a k . 4 for say ten m i n u t e s ? 5 A. 6 3 0 6 Q. Yes, MR. However, I w o u l d like This m i g h t be an We will break certainly. JUSTICE COSTELLO: A l l right. 7 8 9 SHORT ADJOURNMENT 10 11 MR. 12 JUSTICE COSTELLO: Mr. Gibney, we will r enew our interview. 13 I h a v e no 14 f u r t h e r q u e s t i o n s b u t I w i l l p a s s o n e of c o l l e a g u e s 15 o v e r t o you. 16 questions ? 17 A. Mr. R owan w o u l d like to ask you some Yes. 18 19 E N D O F E X A M I N A T I O N O F MR. 20 COSTELLO. 21 22 23 24 25 26 27 28 29 G I B N E Y B Y MR. JUSTICE 1 2 3 MR. ROWAN: Mr. 4 Gibney, t h a t in t h e 5 thereabouts 6 advisors, 7 A 8 308 Q 9 A y o u h a d as y o u r a d v i s o r s , 1 9 7 0 s or accountancy Haughey Boland? T h a t is r i g h t . W h o w e r e y o u r l e g a l a d v i s o r s at t h a t s t a g e ? Do y o u m e a n in t e r m s of m y o w n p e r s o n a l a f f a i r s o r in t e r m s o f p r o p e r t y d e v e l o p m e n t . 10 11 309 Q 12 A Both? T h e p r o p e r t y d e v e l o p m e n t end, Lia m M c G o n i g a l was 13 v e r y i n v o l v e d i n it. 14 the development. 15 b y H u g h Do y l e , 16 r e m e m b e r i f w e had, 17 legal a d v i s o r for the f irm generally. 18 had, 19 t o r e c o l l e c t w h o t h a t m i g h t be. 20 y o u t o l d us 31 0 Q y o u know. He was i n v o l v e d in a lot of M y own a f f a i r s w e r e t a k e n care of T e r e n c e D o y l e & Son s. I can't a n d I a m s u r e w e had, another I a m s u r e we T h e r e w a s a n o t h e r one. I am trying H a v e y o u c o n t i n u e d t o r e t a i n t h e s e r v i c e s of 21 Haughey Boland? 22 No, 23 think, 24 t o -- p r o b a b l y t h e p r o b l e m s t h a t a r o s e . 25 Mr. 26 off. 27 b u t t h e y w e r e n ' t h i t t i n g it off. 28 t h e m a n a g i n g p a r t n e r o f t h e firm. I was m o r e or 29 l e s s i n v o l v e d in t h e a r c h i t e c t u r e , m o r e in the Haughey Boland's while services were retained, I I was a p a r t n e r in S t e p h e n s o n G i b n e y up S t e p h e n s o n a n d Mr. T r a y n o r w e r e n ' t h i t t i n g it They were very good friends for a long time Mr. S t e p h e n s o n is 1 a r c h i t e c t u r e w or k , 2 a r c h i t e c t u r e w or k . 3 31 1 Q 4 A n o t t h a t h e w a s n ' t i n v o l v e d in Yes ? He w a s t h e m a n a g i n g p a r t n e r . He fell out 5 d r a s t i c a l l y w i t h Mr. 6 f i r m n e e d e d a n o t h e r a d v i s o r a n d h e o b t a i n e d -- I a m 7 sorry. 8 o b t a i n e d t h e s e r v i c e s o f Mr. 9 h a d w o r k e d for Gui n n e s s T r a y n o r a n d he felt that the I am confused, yes. No, I am right. C h r i s t o p h e r Dodd, He who & Mahon previo u s l y and had 10 g o n e i n t o p r i v a t e p r a c t i c e as a n a c c o u n t a n t . 11 am not quite c e r t a i n w h e n this was but I w o u l d say 12 it w a s a r o u n d 1 9 7 5 / 7 6 w h e n Mr. 13 Mr. 14 debt and repayments. 15 t h a t s tage too in t erms of b e i n g a p a r t n e r there. 16 W h e n I left I t o o k an o th e r t o t a l l y d i f f e r e n t 17 accountant. 18 312 Q 19 A Who was that? I c a n ' t r e m e m b e r t h e n a m e o f t h e firm . 21 to N iall Byrne & Partners. 23 A about the H e w o u l d h a v e a d v i s e d m e at recollect 31 3 Q I Traynor and Stephenson started having problems 20 22 Now, it b u t I will I u l t i m a t e l y c h a n g e d in the 1980s Do y o u c o n t i n u e t o u s e t h e i r s e r v i c e s ? Yes, yes. I t hink that the previous accountants 24 n a m e s w e r e -- t h o u g h t t h a t w o u l d b e f r o m w h e n I l e f t 25 Mr. 26 314 Q S t e p h e n s o n u n t i l s o m e t i m e in t h e 1 98 0s. Y o u e x p l a i n e d to u s t h a t t h e f i r s t C a y m a n d e p o s i t 27 that you had arose from the profits 28 property transactions 29 thereabouts ? in t h e l a t e o n a n u m b e r of 60s or 1 2 31 5 Q 3 A 4 316 Q Yes ? 5 A Yes . 6 317 Q Into the 1970s? It m i g h t h a v e b e e n 1969. Y o u t o l d u s t h a t Mr. T r a y n o r w a s y o u r a d v i s o r in 7 c o n n e c t i o n w i t h those, 8 . . . (INTERJECTION) 9 A 10 318 Q 11 A that was p r i o r to h i m joining Yes . Guinness Yes, & Mahon? yes. He w a s I think, I am fairly certain that 12 he w a s i n v o l v e d b e f o r e h e j o i n e d G u i n n e s s 13 ye s . 14 319 Q 15 A 16 32 0 Q & Mahon, Right. A y e a r o r so, Yes. not for a l o n g period. So t h a t w h e n he j o i n e d G u i n n e s s & Mahon who 17 was 18 these developments, 19 u s u a l l y in s e p a r a t e l i m i t e d l i a b i l i t y e n t i t i e s ? 20 Yes, 21 where 22 Mr. 23 p r e s e n t at a l l i m p o r t a n t m e e t i n g s , 24 d e a l i n g it w i t h o n a d a i l y b a s i s , 25 with the architecture. 26 was a 27 from H a u g h e y B o l a n d who was look i n g after our 28 general 29 w o u l d be c e n t r a l l y i n v o l v e d in l o o k i n g a f t e r the looking a fter the a c c o u n t a n c y a s s o c i a t e d with which I think you said were I am not quite certain. I was in a p o s i t i o n I w a s n o t d e a l i n g d a i l y w i t h thi s, S t e p h e n s o n was to a g r e a t e r extent. I was but I wasn't I was dealing more I c a n ' t r e c o l l e c t if t h e r e p a r t n e r f r o m -- t h e r e w a s c e r t a i n l y a p a r t n e r financial affairs. I can't recollect who 1 m o r t g a g e e n d of it. 2 i n v o l v e d i n that . 3 32 1 Q Mr. Traynor was centrally So that w h e n a d e v e l o p m e n t was c o m p l e t e t h e r e w o u l d 4 h a v e b e e n s o m e a c c o u n t i n g d o n e to d e t e r m i n e w h a t 5 the profit was? 6 A 7 Yes, no w whe n I said the development, b uildings weren't built. 8 322 Q 9 A 10 32 3 Q More frequently, t h a t w o u l d b e Mr. But I am confused, it w a s Mr. 12 Mr. A S i t e s w e r e sold. Yes? 11 13 in most cases Mr. Gibney. I don't know whether T r a y n o r w e a r i n g h i s H a u g h e y B o l a n d h a t or Tr a y n o r w e a r i n g his Gui n e s s I know, Traynor. & M a h o n hat? I s e e y o u r c o n f u s i o n a n d w e l l a p p r e c i a t e it. 14 He w a s n ' t 15 I t h i n k h e p r o b a b l y w o u l d h a v e b e e n i n v o l v e d in - ­ 16 c e r t a i n l y in a l o t of c a s e s h e w o u l d h a v e b e e n t h e 17 o n e w h o d e c i d e d w h a t t h e p r o f i t was. 18 324 Q Yes. a p a r t n e r o f H a u g h e y B o l a n d ' s at time , but So t h a t p r o f i t w o u l d h a v e b e e n d i v v i e d u p to 19 the p e o p l e who h a d the int e r es t in that p a r t i c u l a r 20 development ? 21 A Yes, in m o s t cases, i n s o m e c a s e s l i k e it w o u l d o n l y 22 b e m y s e l f a n d Mr. Stephenson. Lik e, 23 w h e n w e s o l d t h e s e h o u s e s i n A p p i a n Way, 24 Road , 25 T h e r e w e r e o t h e r o c c a s i o n s w h e n t h e r e w e r e five or 26 six people involved. 27 S o if it h a d b e e n y o u r s e l f a n d Mr. 28 h a d b e e n 5 0 / 5 0 a d v e n t u r e t h e n 5 0% of t h e p r o f i t of 29 that p a r t i c u l a r development w o u l d have bee n sent off it w o u l d o n l y b e m y s e l f a n d Mr. for instance, Winton Stephenson. S t e p h e n s o n a n d it 1 2 A. I d o n ' t t h i n k it h a p p e n e d , I think the Cayman thing 3 was a one off situation. 4 I a m s o r r y to b e so v a g u e , 5 one off thing. I t h i n k it h a p p e n e d w h e n t h e r e w a s 6 profits what e v e r the sum was over there. 7 d o n o t r e c o l l e c t e n o u g h to b e s u r e o f it but, 8 it w a s a o n e o f f s i t u a t i o n . 9 o n e s t a g e sa id: sent, Oka y, 10 the C a y m a n Islands, 11 n a m e in G u i n e s s 12 p roperty purchases. 13 3 2 6 Q. 14 A. 15 16 N o w I c o u l d b e w r o n g h ere, but I t h i n k it is w a s a I t h i n k Mr. I feel T r a y n o r at w e w i l l s e n d a l l t h a t o v e r to a n d t h e r e w a s a n a c c o u n t in o u r & M a h o n w h i c h was u s e d for other All right? T h a t is m y r e c o l l e c t i o n , a n d I k n o w it is t e r r i b l y vague. 327 Q. I u n d e r s t a n d t h a t. 17 that the p r o f i t s 18 which, 19 December one year? 20 A. 21 328 Q. B u t l e t us s u p p o s e , Mr. Gibney, of t h e s e v a r i o u s d e v e l o p m e n t s of c o u r s e , d id not all get c a l c u l a t e d on 31st Yes. T h e y w o u l d h a v e a r i s e n at d i f f e r e n t t i m e s o v e r a period? 22 23 A. 24 3 2 9 Q. Yes. Lets suppose that your share of the prof i t s ha d b een 25 g r a d u a l l y b u i l d i n g u p in a n a c c o u n t i n G u i n n e s s 26 Mahon? 27 A. 28 33 0 Q. 29 I & Yes. A n d at s o m e p o i n t t h a t a c c o u n t , the b a l a n c e of that 1 2 33 1 Q 3 A 4 Is t h a t t h e w a y y o u s e e i t? N o w I c o u l d be c o m p l e t e l y wrong, b u t t h a t is t h e w a y I p e r c e i v e it. 5 332 Q 6 A Yes . An d, m y m e m o r y is b e t t e r n o w t h a n it w a s a y e a r ago. 7 I h a v e b e e n f o r t h e l a s t y e a r t r y i n g t o s o r t o u t in 8 m y own mind, 9 t h e s e c o m p a n i e s are, I am s till t r y i n g to sort out what they are what site th e y r e lated 10 to, 11 g r e a t e x t e n t Mr. 12 o ' c l o c k i n t h e m o r n i n g w i t h b r e a k f a s t at Mr. 13 S t e p h e n s o n ' s house. 14 be there, 15 afterwards. 16 responsibility, 17 dec i s i o n s about this kind of money, 18 t a l k i n g a g a i n about m o v i n g s tuff to Cayman. 19 was 20 a n d that , 21 33 3 Q a n d I a m s o r r y to b e so v a g u e a b o u t it, Traynor might have a Mr. m e e t i n g at 7 Stephenson might they w o u l d decide things, b u t to a some times I w o u l d be told N o w I a m n o t t r y i n g t o g e t o u t of b u t I a c c e p t e d it if t h e y m a d e fully discussed, That but in t e rms of b u y i n g sites a n d I w o u l d say; A l l right. and I am not okay , I m e a n . .. W h e n a p r o p e r t y was s o l d or d e v e l o p m e n t 22 completed, t h e r e w o u l d p r e s u m a b l y h a v e b e e n an 23 account raised and you would have had that document 24 p u t i n f r o n t o f you, 25 I w o u l d say, 26 k e p t or c o p y o f it or not, 27 most p e r tinent one from that regard, 28 t h e r e w a s a f u l l k i n d o f l o o k at it a n d 29 distribution, yes. I imagine? W h e t h e r I g o t a c o p y of it or I w o u l d say, yes. The and certainly w o u l d be one w h i c h for c o n v e n i e n c e I 1 am calling A i l e s b u r y Securities, 2 b e t h e one, 3 w h i c h was which, 4 Street which was our own offices which was 5 New Ireland Insurance Company. 6 o n e t h a t w a s c o m p l e t e d as a d e v e l o p m e n t , 7 The p r o f i t on that t o t a l l y a c c r u e d to m y s e l f and 8 Mr. 9 334 Q 10 A 11 33 5 Q 12 A 13 336 Q 14 A 15 337 Q 16 17 but I have b e e n t r y i n g to p i ec e t o g e t h e r a n d that was a d e v e l o p m e n t in B r i d e A s f a r as I know, T h e n w h e n to g o b a c k t o t h e a c c o u n t i n g d o c u m e n t ? Yes . C a l l it w h a t y o u w il l . Yes . W o u l d t h a t d o c u m e n t h a v e b e e n p r o v i d e d at s o m e s t a g e I a m n o t c e r t a i n and, a l l t h e d o c u m e n t a t i o n on. So, y o u do n o t d e v e l o p m e n t s w h i c h Mr. 22 o t h e r s w e r e i n v o l v e d in, 24 m o s t of t h e s t u f f t h a t Traynor would have prepared know w h e t h e r the prof i t s on the 21 A to the t a x a u t h o r i t i e s ? I mean, 19 23 as it w e r e . o n l y us two. w e w e r e d e a l i n g w i t h Mr. 338 Q That was the only Yes ? 18 20 s o l d to Stephenson. b y s o m e o n e a n d if so who, A and that m ight not I am not certain. Stephenson and yourself and were subject to tax? Certainly there were profits made . 25 339 Q 26 A B u t at t h i s s t a g e H a u g h e y B o l a n d w e r e y o u r f i r m ? for m o st of that p e r i o d H a u g h e y B o l a n d were. I 27 think they only stopped when the kissing stopped, as 28 it w e r e . 29 34 0 Q Yes, 1 w o u l d y o u l i k e to a s k H a u g h e y B o l a n d if t h e y h a v e 2 a n y r e c o r d s o f a n y of t h o s e p r o p e r t y d e v e l o p m e n t 3 transactions? 4 tax related records 5 convenience 6 A l l ri g h t . 7 34 1 Q 8 A 9 342 Q 10 A 11 34 3 Q 13 A 14 344 Q 15 A 16 34 5 Q f o r q u i t e a l o n g t i m e fo r for clients? Yes? Certainly. If y o u w o u l d g e t t h e m f o r us p l e a s e ? Yes, c e r t a i n l y I w i l l do that . W h e r e o v e r the p e r i o d w e ' v e b e e n t a l k i n g about, 70s, 12 A c c o u n t a n c y firms sometimes retain 8 0 's now, where have you been resident for tax? Here in m y house. In I r e l a n d ? In D u b l i n , Right. yes. M a y I t u r n y o u to t h e s t a t e m e n t w h i c h y o u r 17 s o l i c i t o r s p r o d u c e d on y our b e h a l f and ask you 18 p l e a s e t o t u r n to p a g e t h r e e o f t h a t 19 A 20 346 Q 21 A 22 347 Q 23 25 ( E x h i b i t 5)? Yes . Y o u se e s m a l l " d" ? Yes . W h e r e it says: "In r e l a t i o n to t r a n s a c t i o n s on c o n d u c t e d b y Mr. i n t e r e s t in the t r a n s a c t i o n s ... 24 60s, the first account, all the ac c ou n t were T r a y n o r w h o h a d an property ." 26 27 28 29 C o u l d y o u t e l l us a b i t m o r e a b o u t t h a t ? A Yes, Well, the p a r t i c u l a r pr o p e r t y ? whatever you were thinking about whenever your 54 1 2 Well, from '69, say, until '73, '74, m y s e l f a n d 3 Mr. 4 g r o u p of p eople. 5 Insurance Company, 6 P r o p e r t i e s i n a m a s s i n g s i t e s and, 7 l a r g e s t of t h e m a n d sort of the one t h a t I t h i n k we 8 w e r e m o s t i n v o l v e d i n as a g r o u p , 9 of the F i t z w i l l i a m T e nnis C l u b from w h e r e t h e y were Stephenson were engaged with a fairly large They included New Ireland and they included Mclnerney as I said, the was the transfer 10 on the canal, to the site that was p a r t i a l l y 11 o c c u p i e d b y the three of fi c e s that we h a d 12 W e s l e y College, 13 si t e s . 14 C o u r t s on t h e q u a y s i n a p l a c e o f f C u c k o o L an e . 15 r e m e m b e r tha t, 16 sites were smaller and less conspicuous. 17 t h r e e or four sites. and by a n d t h e r e w e r e a n u m b e r of o t h e r T h e r e w a s a site, a warehouse near the Four I I c a n ' t r e m e m b e r -- s o m e o f t h e o t h e r There were 18 19 N o w that g r o u p p a r t i c i p a t e d in p r o f i t m a r k i n g a n d we 20 p a r t i c i p a t e d s p e c i f i c a l l y in s e l l i n g p a r t of the 21 l a n d w h i c h w a s u s e d fo r t h e T e n n i s C l u b t o t h e 22 consortium. 23 349 Q 24 A 25 35 0 Q 26 A A n d Mr. Yes, Traynor was involved? he w o u l d . As a m e m b e r of that c o ns o r t i u m ? He w o u l d h a v e b e e n t h e s o r t o f t h e c e n t r a l f i g u r e in 27 the o r g a n i s a t i o n of all the finance, 28 if b o r r o w i n g was r e q u i r e d a n d c o o r d i n a t i n g and 29 distribution. both borrowing 1 35 1 Q. 2 A. 3 352 Q. 4 A. 5 35 3 Q. 6 A. 7 8 B u t h e h a d a n i n t e r e s t i n it? Yes. He h a d a f i n a n c i a l Y e s he had, i n t e r e s t in it? yes. T h i s y o u s a i d w a s in t h e 1 9 6 0 ' s ? It s t a r t e d in t h e 1 9 6 0 ' s b u t I don't think anything r e a l l y h a p p e n e d i n t h e 19 6 0 s . 354 Q. 9 A t t h e t i m e w h e n Mr. Traynor was still with Haughey Boland? 10 A. 11 35 5 Q. T h a t is r i g h t . He was, therefore, i n v o l v e d d i r e c t l y in the investment ? 12 13 A. 14 3 5 6 Q. Yes. He w a s a p a r t n e r in a f i r m o f a c c o u n t a n t s w h o 15 o f f e r e d you, 16 as y o u r a d v i s o r s ? 17 A. 18 357 Q. 19 A. 20 358 Q. 21 at l e a s t y o u a n d Mr. Stephenson advice Yes. A n d so on? Yes. A n d p r e s u m a b l y o f f e r e d you a dvice in res p e c t of this investment ? 22 A. Yes, 23 3 5 9 Q. Yes? 24 A. 25 36 0 Q. 26 A. financial advice, yes. Not p r o p e r t y advice. No, I understand? If I c o u l d c o n t i n u e j u s t to c l a r i f y o n e s m a l l t h i n g , 27 it m a y n o t b e i m p o r t a n t at all. 28 Mr. 29 a n d m y s e l f in a n o t h e r g r o u p o t h e r t h a n t h a t g r o u p in A f t e r 1974, T r a y n o r w a s a g a i n i n v o l v e d w i t h Mr. Stephenson 1 further property transactions, 2 unwillingly. 3 36 1 Q 4 A albeit, a little W h a t was the n ame of that? It c o n c e r n e d , I c a n ' t r e m e m b e r t h e n a m e o f it. I 5 m e a n t h e y c o i n n a m e s so f r e q u e n t l y I g e t t h e m 6 c o n f u s e d but the site i n v o l v e d was the S o ut h C o u n t y 7 Hotel. 8 362 Q 9 A That was in the 1 970's? T h a t w a s a f t e r 19 74 a n d 1974, 1975, 1976, 10 b i t l a t e r t h a n t h e s i t e at F i t z w i l l i a m . 11 p r o p e r t y market had changed. 12 36 3 Q 13 A 14 364 Q Certainly. W h i c h m a y h a v e s o m e t h i n g to do w i t h t h a t . y o u se e is a d o c u m e n t t o G u i n n e s s 16 7) ? A 18 36 5 Q 20 A 21 3 66 Q & Mahon T h i s as (Exhibit Yes . W h i c h says w h e r e you will see that you a nd others a r e w r i t i n g to G u i n n e s s 19 Y ou see the May I pass you up a document? 15 17 it w a s a T h a t is r i g h t , & Mahon, saying? yes. "I n c o n s i d e r a t i o n of y o u r p l a c i n g at the d i s p o s a l of B e r e s f o r d I n v e s t m e n t s Limited?" 22 23 24 A 25 yes, t h a t s t r i k e s a n ot e , Investments, 26 367 Q 27 A 28 29 Yes, yes. Is t h a t u s i n g t h e n a m e o f . . . ( I N T E R J E C T I O N ) ? T h a t is c e r t a i n l y a v e r y f a m i l i a r n a m e . it m a n y t i m e s . 368 Q Beresford Yes? I have seen 1 A. W i t h o t h e r n a m e s b u t if it r e l a t e s t o o n e s i t e o r 2 n o t o r w h e t h e r it r e l a t e s t o a g r o u p nam e, 3 certain. 4 p e o p l e a n d at l e a s t o n e site. 5 3 6 9 Q. It o b v i o u s l y h e r e r e l a t e s t o a g r o u p of Y o u se e Mr. G i b n e y that the p e o p l e who are g iving 6 t h i s g u a r a n t e e a r e LD. 7 Hyland, 8 and A r t h u r Gibney, 9 A. 10 37 0 Q. 11 A. 12 37 1 Q. 13 A. 14 372 Q. 15 16 J.D. Traynor, 17 McGonagle, JJ. K P . O'Reilly Finnegan, S. S t e p h e n s o n yourself? Yes. So t h a t h e r e w e h a v e Mr. Traynor involved? Yes. In this i n v e s t m e n t ? Yes. At w h i c h point, of course, involved with Guiness A. I am not Yes, he w o u l d have been & Mahon? t h e r e is n o d a t e o n t h i s is t h e r e ? o b v i o u s l y is, he yes. 18 37 3 Q. 19 A. 20 374 Q. 21 A. 22 37 5 Q. What was B e r e sford Investments doing? 23 A. Buying sites and developing property. Yes, Well, t h e r e is a d a t e s o m e w h e r e i n t h i s ? T h e y r e f e r to a l e t t e r o f t h e 5 t h J a n u a r y 1970. T h e y do, t h a t is r i g h t ? Yes. Now whether 24 t h i s g r o u p w e r e k n o w n as B e r e s f o r d I n v e s t m e n t s or 25 not, 26 five companies. 27 r e l a t e d to o n e o r t w o p a r t i c u l a r s i t e s . 28 c e r t a i n w h a t n a m e t h e m a j o r d e v e l o p m e n t w a s h e l d in 29 b u t c e r t a i n l y it is a v e r y f a m i l i a r n a m e t o me, I am not certain. As I say, t h e r e are four or Beresford Investments m a y have I am not 1 2 376 Q 3 4 C a n y o u t e l l m e w h o b r o u g h t t h i s g r o u p of p e o p l e together? A There was I t h i n k Mr. S t e p h e n s o n a n d Mr. 5 w e r e v e r y f r i e n d l y a n d Mr. 6 w i t h Mr. M c G o n a g l e . 7 377 Q 8 A 9 Traynor Traynor was very friendly Who was a solicitor? A solicitor, ye s a n d Mr. S t e p h e n s o n k n e w him. m a y h a v e b e e n in s c h o o l w i t h h i m but, He he, 10 Mr. 11 b e t w e e n t h e m b e c a u s e he I t h i n k m a y h a v e b e e n 12 i n v o l v e d w i t h t h e m at a n e a r l i e r s t a g e . 13 been, 14 b e e n i n v o l v e d p r e v i o u s l y in p r o p e r t y d e v e l o p m e n t an d 15 w h e n I m e t the m, 16 a n d s u c c e s s f u l l y b u i l t at l e a s t o n e m a j o r o f f i c e 17 sp ac e, 18 property; 19 in p r o f e s s i o n s r e l a t e d to p r o p e r t y . 20 378 Q Traynor I think pr o b a b l y was the ma i n connection apart f r o m Mr. all t hese p e o p l e had they had a l r e a d y built, m a y b e more. we l l , Traynor, They had developed T h e y w e r e a l l i n v o l v e d in t h e c e r t a i n l y s o m e of t h e m a r e i n v o l v e d Do y o u k n o w w h e t h e r B e r e s f o r d I n v e s t m e n t s w a s h i t b y 21 the pr o p e r t y slump? 22 Yes, 23 b a d l y h i t b y t h e p r o p e r t y s l u m p i n 1974. I am very 24 conscious r e f u s e d to 25 se e it as a p r o p e r t y s l u m p a n d w a n t e d t o g o o n w h e r e 26 n o b o d y e l s e did. 27 c o n s o r t i u m I t a l k e d to you about w h i c h h a d that 28 site, 29 i n v o l v e d in t h a t as w e l l . all sorts of comp a ni e s that were i n v o l v e d were of t h a t b e c a u s e Mr. He n c e , Stephenson that other the South County site and Mr. Tray n o r was 1 379 Q T u r n i n g n o w to a n o t h e r c o m p a n y w h i c h y o u m e n t i o n e d , Ailesbury Securities? 2 3 A 4 38 0 Q 5 A Yes . W h a t c a n y o u t e l l us a b o u t A i l e s b u r y S e c u r i t i e s ? No, I c o u l d be t o t a l l y wrong, I thought I h ad the 6 impression that A i l e s b u r y Securities might have been 7 t h e c o m p a n y o f m y s e l f a n d Mr. 8 our own offices. 9 I h a v e b e e n t r y i n g to p u t t o g e t h e r w h a t a l l o f t h e s e S t e p h e n s o n to d e v e l o p N o w I w o u l d b e w r o n g a b o u t th a t . 10 companies meant 11 p a c k a g e a n d I have not s u c c e e d e d in m y own mind. 12 38 1 Q 13 in t erms of a p a r t i c u l a r d e v e l o p m e n t P e r h a p s H a u g h e y B o l a n d w o u l d b e a b l e t o a s s i s t you. I think Haughey Boland are now Deloitte 14 A 15 382 Q 16 A Yes . I t h i n k t h a t is r i g h t ? I t h i n k o n e of t h e p e o p l e i n D e l o i t t e & Touche, 17 were existing partners are still there. 18 k n o w o n e p a r t n e r t h e r e st i l l . 19 38 3 Q I think I T h e r e is a l s o a c o m p a n y c a l l e d A v o c a I n v e s t m e n t s A That doesn't ring a bell but I might have been 22 i n v o l v e d b u t it d o e s n ' t r i n g a b e l l . 23 Wren Securities 24 I d o n ' t k n o w w h a t it is. 25 they mentioned? 20 21 & Touche? 384 Q 26 I a m g o i n g o n t h e n Mr. thereabout, 27 A 28 38 5 Q 29 A is a n o t h e r o n e t h a t r i n g s a b e l l b u t Gibney, in 1992, 1 9 9 3 or there was a tax amnesty? Yes . Did you avail of that tax amnesty? No, I didn't, I was u n c o n s c i o u s of the t a x a m n e s t y 60 1 a n d I w a s u n c o n s c i o u s o f t h e n e e d t o d o it at t h e 2 time. 3 far a way from t h i n k i n g about 4 v e r y i n v o l v e d i n d e v e l o p i n g m y o w n p r o f e s s i o n in 5 t e r m s of m y ow n career, 6 the tax amnesty. 7 386 Q A 387 Q institutionally and I missed p e r h a p s y o u d i d n o t r e a l i s e t h e r e w a s an I didn't fu l l y . It w a s s o m e t h i n g 13 A 14 388 Q 15 A 16 This was because, of course, Mr. Traynor, had said Yes, it w a s ... ( I N T E R J E C T I O N ) . And that w a s . . . (INTERJECTION). I w a s n ' t i n v e s t i n g at a l l a n d as such.. . (INTERJECTION). 389 Q 18 Sorry, just one mome n t please, t h a t was, therefore, sitting accumulating interest? 19 A 20 39 0 Q 21 A 22 39 1 Q I w a s n ' t c e r t a i n w h e t h e r it w a s o r not. A n d y o u w e r e u n c o n s c i o u s o f it? Yes . It a c c u m u l a t e d i n t e r e s t a n d as y o u c a n se e f r o m y o u r 23 papers, 24 substantial.. . (INTERJECTION)? 25 A 26 392 Q 27 A 28 39 3 Q 29 I was unconscious £25,000 aside? 12 17 I w o u l d be of. 10 11 Of course, finances. issue to be dealt with? 8 9 I am very sorry I did not but I w o u l d be very it h a d r i s e n to a v a l u e of I was h i g h l y surprised. Yes? A s p e o p l e a r o u n d t h e t a b l e o b v i o u s l y w h e r e too. Yes, but for som e o n e who was on his knees f i n a n c i a l l y a n d t r y i n g to get g o i n g again, get your 1 2 3 394 Q. It d o e s m a y b e seem a little surprising that you were 4 not i n t e r e s t e d in the fact that yo u h a d £ 2 5 , 0 0 0 5 s i t t i n g in an a c c o u n t ? 6 A. I a m n o t s u r p r i s e d at y o u r s t a t e m e n t . I was very 7 s t r a p p e d for m o n e y in the 1970s a n d in the e a r l y 8 1980s. 9 s t a r t i n g o f f de n o u v e a u , it w a s a v e r y b a d p e r i o d . 10 A very very bad period. Hence, 11 borrowed money from Guiness 12 h a r d to get m o n e y anywhere. 13 39 5 Q. Q ui t e apart f rom the fact that I was n e e d to b o r r o w money, 15 get h o l d of this £2 5,000? A. & Mahon. It w a s v e r y I d o n o t u n d e r s t a n d in t h a t c a s e w h y i f y o u h a d a 14 16 you will find I To a g reat extent, w h y y o u j u s t d i d n o t go a n d I did not really realise whether 17 it w a s m i n e o r not. 18 w a s v e r y m u c h a k i n d of -- h e is a v e r y d o m i n a n t 19 f i g u r e a n d he n e v e r e x p l a i n e d v e r y m u c h , 20 c e r t a i n l y p e o p l e he w a s d e a l i n g w i t h l i k e m e a n d h e 21 h a d d o n e me, 22 not k n o w h o w to deal w i t h the sit u a t i o n . 23 m a n of v e r y f e w w o r d s . 24 a n d I w e n t to h i m l o o k i n g f o r m o n e y a n d he said, 25 c a n g e t y o u a lo an. 26 to s t a r t -- b e i n g s e l f - e m p l o y e d at t h e t im e , 27 h a d n ' t r e a l l y s t a r t e d of f the idea of a p e n s i o n 28 u n t i l v e r y v e r y l a t e in lif e. 29 said can I invest some of that m o n e y in a p e n s i o n I w a s v e r y -- I m e a n T r a y n o r I thought, w ell, an i mmense f avour but I did He w a s a He n e v e r e x p l a i n e d a n y t h i n g I I told hi m I was anxious also I I went to h i m and I 1 f u n d a n d h e said, 2 a r e t h r o w i n g y o u r m o n e y awa y, 3 a g e h e said. 4 p a r t of a p e n s i o n f u n d w h e n y o u r e t i r e . 5 3 9 6 Q. 7 A. l i s t e n he s a i d p e n s i o n s you p a r t i c u l a r l y at y o u r You can have the money, Y o u m a k e h i m sound, s o m e w ay s , 6 look, y o u m a k e Mr. a somewhat he said, as T r a y n o r s ou nd , in intimidatory character? He w a s n ' t i n t i m i d a t o r y i n t h e n o r m a l c o u r s e of 8 events. I t h i n k he was a v e r y o r d i n a r y p e r s o n but 9 in m y terms, he i n t i m i d a t e d m e a b o u t m o n e y an d m y 10 l a c k of k n o w l e d g e o f t h e f i n a n c i a l w o r l d . I looked 11 u p o n h i m as a g r e a t b e n e f a c t o r at t h e t i m e b e c a u s e 12 he h a d b a s i c a l l y , 13 c a s e g o i n g to h a p p e n b e t w e e n h i m s e l f a n d 14 Mr. Stephenson. 15 Mr. Steph e n s o n over other things. 16 b e e n e x t r e m e l y g e n e r o u s t o me. 17 a time when I was v i r t ually bankrupt and I treated 18 him with great respect. 19 was a very small practitioner, 20 Cement Roadstone. 21 boards 22 d i f f i d e n c e a n d r e s p e c t a n d w h a t e v e r h e t o l d m e to 23 do, 24 in f i n a n c i a l terms. 25 kid. 26 MR. although there was near l y a court I h ad f allen out w i t h I f e l t he h a d He h a d h e l p e d m e at He w a s a l s o at t h e t i m e I h e w a s C h a i r m a n of He w a s o n v a r i o u s b i g n a t i o n a l so I t r e a t e d h i m w i t h a g r e a t d e a l of I w o u l d do. That was the case e v e n e a r l i e r on He h a d a r e p u t a t i o n as a w h i z z ROWAN: 27 Thank you very much Mr. Gibney. 28 29 E N D O F E X A M I N A T I O N O F MR. G I B N E Y B Y MR. ROWAN 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 MR. JUSTICE COSTELLO: Ms. Mackey? 1 2 3 397 Q. MS. MACKEY: Yes, 4 I just have a few questions, Mr. Gibney, 5 just to tie up a few l o o s e ends t h a t I d i d not q u i t e 6 follow? 7 A. 8 398 Q. 9 S ure. I n r e l a t i o n t o t h e m o n e y in t h e f i r s t a c c o u n t o r t r u s t or w h a t e ver? 10 A. 11 3 9 9 Q. Cayman, yes. O r w h a t e v e r y o u c a l l it in C a y m a n , yes. You said 12 e a r l y on that you b e l i e v e d for quite some time that 13 it w a s a t r u s t ? 14 A. 15 400 Q. 16 Yes. Then you were d o u btful b e c a u s e you felt a trust was som e t h i n g that you should not be able to touch? 17 A. 18 4 01 Q. 19 Yes. W h e n did you bec o m e aware that you c ould touch this money? 20 A. 21 402 Q. 22 A. W h e n did I become aware? That you c o u l d t o u c h that m o n e y in the trust? I am thinking b a c k over a long period. I was 23 u n c o n s c i o u s o f t h e m o n e y w h i l e it w a s t h e r e i n t h e 24 1 9 7 0 's b e c a u s e t h e r e w a s o t h e r m o n e y a n d e v e r y d a y 25 there was 26 -- a n d I w a s n ' t 27 i m p r e s s i o n t h a t it w a s a n d t h i s o n l y c a m e a b o u t 28 Mr. 29 d e a l i n g w i t h Mr. s o m e o t h e r d e a l g o i n g on, Stephenson's t h e r e w a s a l ot c o n s c i o u s o f it at all. I had the from c o n v e r s a t i o n s w i t h m e as h e w a s Traynor much more frequently than I 1 w a s b u t a f t e r t h i s m a n R e i d c a m e in, they were 2 t a l k i n g about a trust w h i c h was d e s i g n e d to prot e c t 3 f a m i l i e s i f p e o p l e die d. 4 I said, 5 h e a r t a t t a c k an d h a d a f a m i l y a n d he d i e d v e r y 6 young. 7 r e c o l l e c t t h e i d e a t h a t it is fo r y o u r c h i l d r e n a n d 8 S t e p h e n s o n said, 9 is f o r y o u r c h i l d r e n . I know Traynor himself, h a d b e e n in b a d h e a l t h , had a very serious H e w a s c o n s c i o u s o f t h i s a n d t h a t is w h y I y o u k n o w y o u c a n ' t t o u c h it if it I said, yes, I said but I am 10 a d o p t i n g a c h i l d at t h e m o m e n t b u t I said, 11 family. 12 wasn't p a r ticularly interested. 13 t h i n k i n g a b o u t t h e m o n e y u n t i l we w e r e c o n f r o n t e d 14 w i t h a s i t u a t i o n w h e r e w e o w e d a l o t of m o n e y a n d 15 Mr. 16 to there. 17 m o n e y f r o m it. 18 in o n e l u m p a n d n o t h i n g e l s e w e n t i n t o it. 19 403 Q. Mr. T r a y n o r said, I do not rec o l l e ct I am moving your money from here I w a s u n c o n s c i o u s o f it. I never drew To t h e b e s t o f m y k n o w l e d g e , it w e n t T r a y n o r d i d n o t a s k y o u t h e n if y o u c o u l d u s e that money. 21 w a y it h a p p e n e d ? A. I h a v e no I knew I would not have a big family and I 20 22 as He s a i d he w a s m o v i n g it, is t h a t t h e T h a t is w a y he d e a l t b u t h e h a d t o h a v e o u r 23 agreement 24 a n d w e s i g n e d an a g r e e m e n t . 25 as f a r as w e knew, 26 f a i r l y c e r t a i n I a m s p e a k i n g f o r S t e p h e n s o n as we ll, 27 w e w e r e n e v e r c o n s c i o u s o f it. 28 t h a t -- I b o u g h t a l a r g i s h h o u s e i n t h e c o u n t r y at 29 o n e s t a g e a n d it w a s f ul l y . I m e a n I am v e r y c o n s ci o u s of that He w a s m a n a g i n g it and, it w a s t h e r e b u t w e n e v e r , It w a s I am something f i n a n c e d o u t of m o n e y I m a d e 1 but I n e v e r th o u gh t about saying, 2 t h i s t o do it. 3 404 Q 4 5 It n e v e r o c c u r r e d t o me. Is t h a t t h e f i r s t t i m e t h a t y o u k n e w y o u c o u l d u s e it w a s to p a y o f f y o u r l o a n ? A T h e f i r s t t i m e I w a s c o n s c i o u s o f it, that sounds like a very lame excuse but - ­ 6 7 ca n I m o v e some of 405 Q C a n I j u s t r e f e r y o u a g a i n t o p a g e t h r e e of t h e 8 statement that your solicitor p r e p a r e d there 9 ( E x h i b i t 5)? 10 A 11 406 Q 12 A 13 407 Q Sure . A n d t o p a r a g r a p h d? Yes . Y o u say: 14 "I n r e l a t i o n t o t h e f i r s t a c c o u n t , t r a n s a c t i o n s on the ac c ou n t were c o n d u c t e d b y Mr. T r a y n o r . " 15 all 16 17 18 W h a t d o y o u m e a n b y al l t r a n s a c t i o n s ? A 19 20 m o n e y t h e r e a n d t a k i n g it o u t a g a i n . 408 Q A 23 24 T h a t is w h a t y o u m e a n b y a l l t r a n s a c t i o n s Yes, I m e a n I do n o t r e c o l l e c t a n y o t h e r transactions. 409 Q A n o t h e r q u e s t i o n s l i g h t l y r e l a t e d but on a d i f ferent 25 a s p e c t o f it, 26 that occasion; 27 p e o p l e in t h a t c o n s o r t i u m ? 28 29 so o p e n i n g and closing? 21 22 T h e o n l y t r a n s a c t i o n I r e c o l l e c t is p u t t i n g t h e A the c o n s o r t i u m that was i n v o l v e d on c a n y o u g i v e m e t h e n a m e of t h e 1 Yes, certainly. T h e n a m e s o f t h e p e o p l e w h o w e r e in 2 your letter r e l a t e d to B e r e s f o r d Investments. 3 were the central 4 d i d a l s o h a v e M c l n e r n e y P r o p e r t i e s o r M c l n e r n e y -- I 5 am not certain w h ether the c o mpany was M c l n e r n e y 6 Properties but they were represented by 7 Mr. A m b r o s e M c l n e r n e y at t h e t i m e a n d t h e y h a d 8 N e w I r e l a n d I n s u r a n c e C o m p a n y as p a r t n e r s 9 of t h e d e v e l o p m e n t , figures of the consortium. They They for part t h i s is o n l y o n e site. T h i s is t h e b i g site. 10 11 411 Q 12 A 13 The i n d i v i d u a l ? Individuals, letter, 14 412 Q 15 A w e r e t h e i n d i v i d u a l s e n u m e r a t e d in t h a t I do n o t t h i n k t h e r e w e r e a n y m o r e . There were no others? Not individuals. T h e y w o u l d b e i n v o l v e d i n t w o or 16 t h r e e s i t e s as o p p o s e d to t h e o n e s i t e o n t h e t e n n i s 17 court which had other participants. 18 413 Q W h e n y o u t e l l u s t h a t De s T r a y n o r s u g g e s t e d to a l l 19 of y o u at t h a t s t a g e t h a t it m i g h t b e p r o v i d e n t i a l 20 t o se t u p t r u s t s , 21 s u g g e s t e d it? 22 A As f a r as I knew, it w a s to t h a t g r o u p of p e o p l e he he w a s d e a l i n g w i t h m y s e l f a n d 23 Stephenson. 24 I was unconscious 25 d i d w i t h t h e m b u t c e r t a i n l y w h e n h e t a l k e d t o us, 26 w a s t o m y s e l f a n d S t e p h e n s o n m o r e o r l e s s as an 27 accountant. 28 414 Q 29 A He m a y h a v e b e e n d e a l i n g w i t h t h e m b u t o f t h e i r -- I d o n o t k n o w w h a t h e Okay? He w a s a m e n t o r of Mr. 68 S t e p h e n s o n for a l ong time it a n d it w a s m o r e o r l e s s as a n a c c o u n t a n t 1 2 415 Q V e r y go od. In r e l a t i o n to t h e l o a n s t h a t y o u h a d 3 ov e r the y ears in G u i n n e s s 4 tax r e l ie f on t hose loans? 5 A No, I think. I d o n o t t h i n k so. & Mahon, did you claim My accountant might have but 6 I a m u n c o n s c i o u s o f w h e t h e r h e d i d or not. 7 w e r e t h e t w o l o a n s i n t h e 19 8 0 s . 8 416 Q 9 A 10 417 Q Yes? M y a c c o u n t a n t m i g h t have. Yes, I n o t i c e d t h a t t h e r e is a c e r t i f i c a t e -- h e a s k e d f o r c e r t i f i c a t e s o f t a x t h e r e of i n t e r e s t ? 11 12 A 13 418 Q Yes . In r e l a t i o n to t h e s e c o n d a c c o u n t , the £25,000. 14 y o u s a y it w a s t h e r e f o r a n u m b e r of y e a r s . 15 se t as i d e , 16 w e r e n o t a w a r e u n t i l Mr. 17 to y o u a n d y o u w e n t to d o . . . ( I N T E R J E C T I O N ) ? 18 A 19 20 419 Q It w a s y o u d i d n o t k n o w w h e r e it w a s a n d y o u T r a y n o r m e n t i o n e d it a g a i n I w a s c o n s c i o u s o f it b u t I felt rather awkw a r d W h e n did you become aware that you could actually w i t h d r a w m o n e y from that account? A 23 I think p r o b a b l y when I went into b o r r o w m o n e y and w h e n I s t a r t e d t a l k i n g a b o u t m y p e n s i o n t o him. 24 420 Q 25 A Yes ? He s a i d to me, he said, l o o k if yo u w a n t a few 26 thousand pounds. 27 this 28 b r o u g h t in t h e 1 9 8 0 s p a r t o f t h e s i t e n e x t doo r . 29 As about i t . 21 22 These s tag e, I t o l d h i m I w a n t e d -- m y h o u s e at I h a d d e c i d e d t o e x p a n d it. I had 1 2 He t o l d m e t h e n. 3 s a i d if y o u w a n t a f e w t h o u s a n d p o u n d s , 4 a n y st ag e, 5 422 Q h e said, 7 A 8 423 Q 9 A 10 424 Q 11 A r i n g me. set asi d e ? Yes . You were clear about that? Yes, yes, it w a s n ' t a loan. W a s t h a t a r o u n d 1980, when would that have been? I a m n o t c e r t a i n w h e n I f i r s t t o o k m o n e y out. 12 t h i n k it m u s t h a v e b e e n in t h e l a t e 13 d i d n ' t do a n y t h i n g w i t h 14 Mr. 15 425 Q h e s a i d at D i d h e s a y to y o u t h a t f e w t h o u s a n d w o u l d c o m e o u t of the £ 2 5 , 0 0 0 6 I w a n t e d m o n e y t o b u i l d a n d he I 1980s b ecause Traynor.. . (INTERJECTION). Y o u w e r e s a y i n g it w a s in r e l a t i o n to, y o u w e n t in 16 t o s p e a k to h i m a b o u t a p e n s i o n a n d y o u w e r e d o i n g 17 w o r k on his h ouse? 18 A 19 426 Q 20 A 21 427 Q T h a t w o u l d b e I t h i n k t h e l a t e 19 80 s. The late 1980's? Yes . At t h a t stage, you knew you could w i t h d r a w money from this account? 22 23 A 24 428 Q 25 A 26 429 Q Yes . Y o u k n e w t h e r e w a s £ 2 5 , 0 0 0 in it? Yes . H o w m u c h d id you feel you c o u l d withdraw. 27 r e c e i v i n g no s tatements 28 s t a t e it w a s in? 29 I A You were so h o w d i d y o u k n o w w h a t 1 430 Q 2 A 3 431 Q 4 A I didn't. So you just w i t h d r a w t h a t . . . ( I N T E R J E C T I O N ) ? Yes, i f I g o t m o n e y I w a s g l a d to g e t it. 5 s u r p r i s e d as y o u wer e, 6 got. 7 432 Q in fact, I w a s as by the statements I A t n o s t a g e d u r i n g t h e p e r i o d t h a t f o l l o w e d u p to 8 time that you got these s t at e m e n t s d i d you know how 9 m u c h m o n e y w a s in it at a l l ? 10 A 11 433 Q No. W h e n y o u w e n t a l o n g t o Mr. 12 these documents, 13 t h e m there, 14 A/A2 ? 15 A 16 434 Q C o l l e r y a n d he gave you as w e s a w w h e n w e w e r e l o o k i n g at they were simply headed Ansbacher Cayman Yes . Y o u m u s t h a v e l o o k e d at t h o s e a n d said, 17 t h i s l a r g e s u m o f m o n e y a n d said, 18 r e l a t e to m e ? 19 Did you ask him about that? 20 A 21 435 Q how does this I m e a n w h o s a y s t h i s is m y s t a t e m e n t . I didn't. Did you not wonder why something without your name on i t . . . (INTER J E C T I O N ) ? 22 23 No, I am seeing A 24 I d i d n ' t l o o k at t h e s t a t e m e n t s w h i l e him. 25 436 Q 26 A 27 I t o o k t h e m a w a y w i t h me. When you went home? W h e n I went home I went into m y accountant and s h o w e d t h e m to him. 28 437 Q 29 A I was with W e r e y o u s a t i s f i e d it w a s y o u r s ? 1 438 Q 2 A 3 439 Q W h y did you presume that? 4 A B e c a u s e h e g a v e it t o me. 5 440 Q Y o u d i d n o t r a i s e t h e m a t t e r w i t h h i m a n d say, are you sure these are mine? 6 7 I p r e s u m e d it w a s m i n e . A No, f r a n k l y w h e n I w a s w i t h Mr. Collery, it w a s 8 a very short period. 9 m u c h more concerned about the problems that were fo r It w a s i n a n e v e n i n g a n d I w a s 10 a r i s i n g out of the a c c o u n t a n d the 11 Revenue Commissioners. 12 ab o u t , 13 R e v e n u e C o m m i s s i o n e r s a n d w h o do I g o t o a n d t h i n g s 14 like that. 15 441 Q 16 17 I said, A n y q u e s t i o n I a s k e d h i m was have you b e e n s p e a k i n g to the T h a t is t h e q u e s t i o n s I a s k e d him. B u t y o u d i d n o t go b a c k to h i m w h e n y o u h a d a c h a n c e t o l o o k at it? A No, I t r i e d to f i n d Mr. 18 get h i m and rang nu m b e r s 19 g e t him. 20 442 Q 21 A C o l l e r y a gain and c ould not for a p e r i o d and c ould not He s e e m e d to h a v e d i s a p p e a r e d . W h a t is t h e s t a t e o f t h a t p a r t i c u l a r a c c o u n t n o w ? I honestly don't know. I d o n ' t k n o w w h e r e it is or what. 22 23 443 Q 24 A 25 444 Q 26 Y o u d i d n o t c l o s e it? No, I did nothing. W h e n was the last time you saw a b a l a n c e on it? is t h e s e d o c u m e n t s t h a t w e h a v e h e r e ? 27 A 28 445 Q 29 A W h e n I got those, yes. Y o u h a v e d o n e n o t h i n g i n r e l a t i o n t o it s i n c e ? Nothing. It 1 4 46 Q. C o l l e r y in r e c e n t t i m e s a b o u t it? 2 3 H a v e y o u s p o k e n t o Mr. A. I s poke to h i m once a g a i n t h r o u g h an a c c o u n t a n t who 4 w o r k e d in m y o f f i c e w h o is a v e r y c l o s e f e n d of 5 mine. 6 m a n C o l l e r y to f i n d out; 7 a b o u t t r y i n g to get this a f f a i r righted. 8 me d o w n to a n o t h e r a c c o u n t a n t ' s office, 9 h i s a n d Mr. 447 Q. I was more concerned He b r o u g h t a f r i e n d of Collery was there and m y real reason What was this other accountant's office where you m e t Mr. 12 13 again, for.. . (INTERJECTION). 10 11 I s a i d I w o u l d like to get m y h a n d s on this A. Collery? S o m e w h e r e in M a y n o o t h b ut I can't remember the name 14 of t h e ma n. 15 w a s N e i l L u n d. 16 i n S t e p h e n s o n & G i b n e y a n d is a v e r y c l o s e f r i e n d of 17 m i n e a n d t h e r e a s o n I w a n t e d to s e e Mr. 18 because 19 from the T r i b u na l 20 w h a t it w a s . 21 448 Q. 22 A. T h e m a n w h o b r o u g h t m e do w n , his name He w a s a p e r s o n a l a c c o u n t a n t w o r k i n g C o l l e r y was I was very worried about a letter I received The paym e n t about this £8,000. I did not know into Amiens? Yes a n d I w a n t e d to f i n d out a b o u t this a n d I spent 23 c e r t a i n l y t w o or t h r e e w e e k s l o o k i n g fo r 24 Mr. 25 w h e r e t h i s g u y is, 26 down and I asked him about the account and I didn't 27 get a v e r y s a t i s f a c t o r y answer. 28 it w a s an i n t e r n a l 29 4 49 Q. Collery. Eventually, t h i s m a n said, look I know d o y o u w a n t to s e e him. situation, H e said, I went he t h o u g h t m o v i n g money. W h e n w a s it t h a t y o u s a w h i m a b o u t t h a t ? 1 2 450 Q 3 A 4 451 Q 5 L a s t year, s o m e t i m e b e f o r e t h e s u m m e r l a s t yea r. O n t h a t o c c a s i o n d i d y o u s p e a k to h i m . . . (INTERJECTION)? 6 A 7 452 Q 8 A 9 I didn't. About your own account? I j u s t s a i d -- yes, the o ther re a s o n I saw h i m was m y accountant and m y solicitor both w a r n e d me before 10 y o u go n e a r t h e R e v e n u e C o m m i s s i o n e r s , 11 m a k e c e r t a i n t h a t m o n e y is a r o u n d . 12 n o t t a k e n it a w a y s o m e p l a c e . 13 look, I said, That they have I a s k e d him, I said w h e r e is t h i s m o n e y ? 14 453 Q 15 A 16 454 Q 17 A 18 455 Q 19 A 20 456 Q 21 A 22 457 Q 23 A 24 458 Q C an you find that out? 25 A I s u p p o s e I c o u l d see, 26 459 Q 27 A 28 460 Q 29 you better W h a t d i d he say? He s a i d t h e m o n e y is her e, D i d y o u say, No, it is i n D u b l i n . w e l l c a n I h a v e it? no I didn't. W h y not? I p r e s u m e d it w a s t h e r e . W h e r e i n D u b l i n d i d he s a y it w a s ? He d i d n ' t t e l l me. A n d you did not ask? No. It w o u l d b e u s e f u l , yes. w o u l d it not, if yo u cou l d ? Yes . W o u l d y o u c o n t a c t Mr. can be found now? Collery? Do y o u k n o w w h e r e he 1 A. 461 Q. W e c a n t e l l y o u s t r a i g h t a w a y w h e r e h e is. 4 in K i n d l e B a n k i n g ? 5 MS. CUMMINS: Eastwall. A. In? MS. 8 CUMMINS: In t h e E a s t w a l l 9 Project. I can give you the address. 10 11 He w o r k s K i n d l e B a n k i n g in 6 7 I would ask t h i s . . . (INTERJECTION). 2 3 I w o u l d find him the same way I found him before. 4 62 Q. MS. MACKEY: We can give yo u or y o u r solicitor the address? 12 13 A. 14 463 Q. I p r e s u m e d he w a s i n M a y n o o t h . No, h e is no t. He is w o r k i n g h e r e i n D u b l i n a n d we 15 c a n g i v e y o u an a d d r e s s b e f o r e y o u l e a v e t o d a y . 16 y o u w o u l d c o n t a c t h i m a n d if y o u w o u l d a s k h i m w h e r e 17 t h e m o n e y is now, 18 exactly, 19 and a statement? 20 A. 21 464 Q. 22 A. 23 465 Q. if he s a y s it is her e, g e tting p r ecise details, If where a precise amount O k ay. A n d if y o u w o u l d f u r n i s h t h a t t h e n t o u s ? Yes, certainly. That w o u l d be g r a n d and I just have one more 24 question and then I am finished. 25 a g a i n t h a t w h e n y o u w e n t to s e e Mr. 26 him about a pension, 27 to i n vest s o m e o f t h a t m o n e y is w h a t y o u said, 28 pension. Some of w h a t m o n e y w e r e yo u r e f e r r i n g to? 29 A. You mentioned T r a y n o r to as k y o u s a i d to him, The m o n e y that was in this account. you w o u l d like in The m o n e y that 1 he h a d r e t a i n e d to p r o t e c t m y m e w s , 2 The £2 5 , 0 0 0 3 o n t h a t o c c a s i o n t h a t it w a s t h e r e ? 4 A 5 yes. so y o u k n e w w h e n y o u w e n t a l o n g to h i m Yes . MS. MACKEY: T h a t is g r a n d . v e r y m u c h Mr. 6 7 Thank you Gibney. T h a t is a l l t h e q u e s t i o n s I h av e . E N D O F E X A M I N A T I O N O F MR. G I B N E Y B Y MS. MR. T h a t is a l l Mr. 8 9 MACKEY 10 11 JUSTICE COSTELLO: t o d a y then. 12 13 14 If y o u c o u l d get the i n f o r m a t i o n that we r e quire? A C o u l d I go o v e r a g a i n p r e c i s e l y t h e i n f o r m a t i o n . 15 Mr. 16 a m o u n t o f it. 17 MS. Collery, the monies, MACKEY: its w h e r e a b o u t s a nd the To get d o c u m e n t s 18 19 G i b n e y for if you h a v e those. A Get documents, 20 companies ? 21 MR. yes. Haughey Boland and those JUSTICE COSTELLO: You were to also asc e r t a i n f rom the R e v e n u e 22 23 C o m m i s s i o n e r s w h e t h e r you p a i d tax on the interest 24 in the Cayman Islands. 25 26 27 28 29 A Okay. MR. JUSTICE COSTELLO: There m a y be other m a t t e r s b ut we w i l l see f r o m the t r a n s c r i p t of the evidence? 1 Mr. 2 5 6 A. Certainly. MR. JUSTICE COSTELLO: V e r y w e l l t hen, Mr. Gibney. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 to c o m e in w h e n t h e t r a n s c r i p t is r e a d y t o s i g n t h e t r a n s c r i p t . 3 4 Gibney, THE E X A MINATION WAS THEN CONCLUDED T h a n k you. :14 00 0% 4.70/5 41,9499 1.0.7.0190? w?a??u I 8 t b O c to b e r 1 9 7 7 . C h r l a Dodd r e c e n t l y w r o te t o H r . J . D . T r a y n o r t o g e t c o p ie s o f P e r s o n a l A c c o u n ts o f b o th San S te p h e n s o n and y o u r s e l f and t h e b a c k in g fu n d s fro m t b s 1 s t O c to b e r 1 9 7 8 . I have to d a y w r i t t e n t o b i n g i v i n g b i n t h e in f o r m a t i o n r e l a t i v e t o Sam and a d v i s i n g t h a t I a s w r i t i n g t o you l e t t i n g you h a v e I n f o r m a t i o n » o o v e r in g y o u r own p o s i t i o n . A c c o r d in g ly I h a ve p le a s u r e i n a t t a c h i n g h e r e t o a S ta te m e n t o o v e r in g y o u r R e s id e n t L o an A o o o u n t fro m th e 1 s t O c to b e r 1 9 7 6 t o e lo s i n g and a l s o a n o t e c o v e r in g t b e Cayman p o s i t i o n fro m t h e 1 s t O c to b e r e lo s in g . T o u rs s i n c e r e l y , I P . O’ D w y er, Loans O f f i c e r . * !flf/ ........... ■' ..... . >-1' •• *•' '£>? (Ba?<543L^<’-■ v: • v■• •, .v . • .•■-j V• ..: cvJ; • ■-ei 0 A YU A N 1st Ootobor 1978 BllABOS % £ S l a t D o o v a b tr 10 7 6 20th January 1977 €142,973.40 In te re s t 3,809.71 g „ J 0 0 .8 1 2147,377.62 A oooant e lo M d by t r a n s f e r t o A r t h u r O l b u r Loan GU1NNESS+MAH0 N LTD o• av'tfERS m 17 College Green Dublin 2 PQ Sox 55A ^lepncne rs2-t-M P r iv a t e and C o n fid o n C la l 1 4 eh O c t o b e r , 1976. A r t h u r G ib n e y , E s q ., M e s s r s . S t e p h e n s o n G ib n e y & A s s o c i a t e s , M o ly n e u x H o u s e , 67/69 B r i d e S t r e e e , DUQLIN 3 . Dear S i r , ' We r e f f r r to th e f a c i l i t y l e t t e r d a te d 2 8 th S e p te m b e r, 1 9 7 6 a r d addressed to you by u s . We have been In f o r m e d b y G uinness Mahon Cayman T r u s t L im ite d t h a t t h e y w i l l c a r r y o u t yo u r i n s t r u c t i o n s i n th e f o l l o w i n g re s p e c t!.!: • 1. ' E x i s t i n g h y p o th e c a tio n a g re e m e n ts r e l a t i n g to C a l l D e p o s its made w it h them w i l l be c a n c e l l e d and funds so d e p o s it e d w it h them w i l l be h y p o th e c a te d a g a i n s t y o u r p e r s o n a l l o a n a c c o u n t and t h a t o f i l r . Sam S te p h e n s o n 's i n t h i s Bank o n ly . 2. E x i s t i n g second l i e n on C a l l D e p o s its w i l l b e c a n c e l le d . ^ 3. £ 2 0 , 0 0 0 i s - to be t r a n s f e r r e d t o o u r o r d e r i n c o n n e c tio n w ith G em ini a n d y o u r Cayman d e p o s its a r e t o b e d e b ite d c o r r e s p o n d in g ly . 4. Y o u r Cayman d e p o s its a r e to* be d e b it e d w ith £ 1 3 , 9 5 4 . 0 5 and t h i s am ount c r o d i t e d to U r . Sam S te p h e n s o n 's Cayman d e p o s it s . T o u rs f a i t h f u l l y , GUINNESS & MAHON LTD. AppendixXV' I•• r A r t h u r G ib n e y , Esq 4 7 , Leeson P la c e , D u b lin 2 . Dear 8 1 r , ire t i r e p le a s e d t o c o n firm t h a t Guinness+Jtahon L i n i t e d a r e p r e p a r n d t o make a f a c i l i t y a v a i l a b l e t o y o u , s u b j e c t t o th u f o l l o w i n g te rm s and c o n d i t i o n s : A r t h u r G ib n e y . ' ' ** C l) B o rro w e r: (2 ) A m ount: £ 1 4 2 ,9 7 3 .4 0 (One H u n d re d and F o r t y Two Thousand, N in e H u n d re d and S e v e n ty T h re e Pounds F o r t y P e n c e ) - I r i s h f i. (3 ) T e rn : A l l fu n d s advanced a r e r e p a y a b le on demand, b u t i n a n y c a s e n o t l a t e r th a n 3 0 th S e p te m b e r, 1 9 7 7 . (4 ) In te r e s t: We propose c h a r g in g i n t e r e s t on t h e . Loan a t 12% p e r a n n u a f i x e d . In te r e s t s h a l l be d e b it e d t o t h e a c c o u n t and become p a y a b le h jr 'y o u on t h e 3 1 s t * Decem ber, 3 1 s t M a r c h , 3 0 t h June and a t M a tu r ity , o f th e L o a n . (5) Onvdovo: T h e fu n d s w i l l b e .s a d e a v a i l a b l e t o you by way o f ' Loan ■A c c o u n t i n y o u r name. Such fu n d s w i l l b e draw n b y you on th e 1 s t O c t o b e r , 1 97 0 by t r a n s f e r t o y o u r e x i s t i n g Loan A ccount i n repaym ent t h e r e o f . (6 ) L iq u id ity C la u s e : ' * ’ . I f t h e r e s h a l l b e a n y in c r e a s e i n th e c o s t t o us o f a a k in g o r m a in t a in in g th e Loan by an amount w h ic h we deem m a t e r i a l r e s u l t i n g fro m a n y c h a n g e s i n t h e r e s e r v e o r l i q u i d i t y r e q u ir e m e n ts t o w h ic h we may be s u b je c te d , th e n we s h a l l be e n t i t l e d t o c a l l f o r paym ent o f a d d i t i o n a l /over (C o n td .) : i n t e r e s t o f s u c h a m o u n t a s we s h a l l c e r t i f y a s t& e am ount r e q u i r e d t o . co m p en sate f o r s u ch i n c r e a s e d c o s t w i t h e f f e c t fr o m t h e d a t e o f n o t i f i c a t i o n , T o u s h a l l be a t l i b e r t y w i t h i n one m onth a f t e r such n o t i f i c a t i o n and w it h o u t p a ym e n t o f a n y p re m iu m o r p e n a l t y - t o r e p a y t h e f u l l am ount o f. t h e f a c i l i t y o u t s t a n d in g t o g e t h e r w i t h i n t e r e s t a t t h e r a t e a p p ly in g p r i o r t o n o t i f i c a t i o n . . ' W e e n c lo s e h e r e w i t h a copy o f t h i s f a c i l i t y l e t t e r ■ fo r s i g n a t u r e b y y o u an d r e t u r n , t h e r e b y c o n f i r m i n g y o u r a c c e p ta n c e o f t h e f a c i l i t i e s on th e te r m s m e n tio n e d . T o u rs f a i t h f u l l y , For GUINNESS+'MAHQH LIMITED K 0'Jbwyer Loans O f f i c e r B.«J. l l c L o jf g h lin * A u t h o r is e d S i g n a t u r e G.M cC. U-* g e ;_ SAM STKPHUfSOW ft ARTHUR GIBMBY A tta c h e d h e re to I s a achedule ahowing tha p r a a m t bo rro w ings by Sam on h i s p e rs o n a l Account, A rth u r oa h ia p e rs o n a l A cco un t, Stephenson G ib n ey fe Asaociatas P a rtn e rs h ip A cco u n t, Stephenson and G ib n e y J o in t Account, A lle e b u ry S e c u r it ie s Account ( b e n e f i c i a l l y owned by Sea and A r t h u r ) and Baai Stephenaon T a ra A c c o u n t .-• I n a d d it io n Guinness llahon London haa guaranteed 265,0 00 to r . K . C . B . D u b lin on t h e i r b e h a lf and we, o f c o u rs e , have counter** g u a ra n te e d London. Saa Stephenaon haa guaranteed the Account o f Avoca Investm ents L im it e d on w h ich a lo s s o f £28,000 l a e s tim a te d . Th e t o t a l in vo lve m e n t co u ld th e re fo re be aa f o llo w s ' 498,414 P e r Schedule G uarantee P .N .C .B . G uarantee Avoca 0 5 .0 0 0 2 5 .0 0 0 £588,414 A g a in s t t h i s th e re would he T r u s t Yunds t o t a l l i n g £332,376 making a s h o r t f a l l o f £256,038. T h e s e c u r i t y w hich we ho ld la as fo llo w s T i t l e Deeds A ile a b u r y S e c u r itie s L l a l t e d e s tim a te d to r e a lis e n et le s s than 75 .00 0 e a tim a ted 145,000 e s tim a te d 45.000 A r t h u r G ib n e y Hews e s tim a te d 20.000 A r t h u r G ib n e y W exford farm e a tim a te d 60,000 A r t h u r G ib n e y C lo n t a r f Bouse e s tim a te d 9,000 B a lly n o e Bouse and Farm S am Stephenaon Mews . . £354,000 E ach haa s ig n e d a j o i n t and s e v e ra l G uarantee lim it e d to £10,000 f o r B e re s f o rd Investm ents L im ite d . T h is haa been ig nored as i t i s c o n s id e re d n o th in g w i l l be needed from the G u a ra n to rs . Each baa s lffn a d a Guarantaa f o r 12j% o f a lo a a i n G a a ln L S e c u r itie s . No i n t r t w o t h a r than Bank In t e r a a t / C h a r * o a o j^ g ra d i t a < ■ a d ^ 'lo W y i t h o a t a y a p a c m c « a * h o r ia » t io n . JDT/AJV taiMl Account. Ml«kwy Saeartttw. ' S. STfMRHM t&mr TOT*. tW ,tl7. 11 Dr. tm ,m . to nr. Z229>981. (5.Dr. 17.907..MOP. S 37.907. X.Dr. t 79,ai4. 7l.8r. SHr>wnn Blbaw aarf Auoelitat. I K,«1. OB Dr. ( SM». 00 DP. ■ filljn. )« Bp . StayhMM* wi filbMV. £ 403<*. n Op. 1 N J H . 7*Jr. 1 0I.W7. 40 Bp . toikeart. t .at. ncr. a n ,m . ?i.or. UUUCB US Kt 17TH.HW. iw» , * 031,191. <4 Mr. t m . a er. 1491,414. 40 Dr. H A Y E S & S O N S . S O L I C I T O R S ’ * • . LAVERYHOUSE, EARLSFORT TERRACE. DUBLIN 2 T E L E P H O N E + 3 5 3 -1 -6 6 2 4 7 4 7 F A X + 3 6 3 -1 -6 6 1 2 1 6 3 '‘ e m a i l : h a jr e * o « u * ie c u r e m * iL ie D X D U B L IN 173 O ffice o f the Inspectors, Third Floor, * Trident H ouse, Blackrock, County Dublin. O ta r r ^ tn m a y b u r n fim u * AW/MB Pr*f 13 M arch 2000 Oar CHent; Arthur Gibney. Dear Mr. Justice C ostello, M s. Mackey & Mr. Rowan. We act for Arthur Gibney o f 47 Leeson Placet Dublin 2 who has passed us your letter o f the 20* January. Firstly w e would w ish to apologise on our C lient's behalf for the delay in responding. Our C lient's comm ents w ill have to be taken in the context o f the fact that many o f the relevant events occurred between twenty and thirty years ago. N o documentary evidence was available to our Client until he was furnished with documentation on two occasions over the course o f the past tw o years by Guinness & Mahon. Our Client does not believe that at any time he had either a Caymeu Island or Jersey Trust In the late 1960s and early 1970s our Client practised as an Architect in Stephenson Gibney & A ssociates. Our Client and Mr. Stephenson were involved in several large site acquisitions in this period, the largest o f the sites acquired being the old Fitzwilliam Lawn Tennis Club (upon which now stands the I.D .A . building) and some property on the Appian W ay. At that time, Guinness & Mahon was the lead Banker o f a group o f Bankers, w hich financed these transactions. Our Client did have Caymen deposits in this period which related to his property development activities. .../ ' r* ■ ■ q HTINUATION ■ SHEET No. • HAYES fcSONS -2- • In or about 1974, th en was a severe downturn in the property market leaving the Banks from whom our Client and his partner had borrowed exposed on their security. Our Client disposed o f all o f the properties in which he had an interest and in order to make up the shortfall on borrowings, our Client found him self having to sell a house which he had bought in Enniscarthy, County Wexford and a house at S t Laurence ’s Road, Clontarf, which his W ife had owned, to settle his indebtedness with Guinness A Mahon. At this tim e our Clients Caymen Deposits were repatriated to pay o ff these Irish loans. Copies o f the correspondence which our Client received from Guinness & Mahon regarding this are attached and these set out the names o f persons with whom our Client dealt in this period in addition to Mr. Des Traynor at the Bank. The correspondence does refer to Guinness Mahon Caymen Trust Limited, but as indicated above our Client does not recall having executed any Trust documentation. He does recall on one occasion having met Des Traynor o f Guinness & Mahon together with an Expert who he believes was called Don Reid when he received advice about the use o f Offshore D eposits and Trusts. This would have been in or about the early or mid 1970s. B y the mid 1970s the entire o f our Client’s assets had been consumed by his liabilities due to the Banks on loans to finance property development. At this time in the late 1970s, Mr. Traynor advised Mr. Gibney that in recognition o f his co-operation in settling his indebtedness, Mr. Traynor would set aside a sum o f approximately £25,000. At this tim e portion o f the debts which he had incurred tfah Mr. Stephenson remained outstanding. Mr. Stephenson disputed portion o f the debt and made settlement over a longer period than Mr. Gibney. Mr. Stephenson continued to make payments from the indebtedness until some tim e in the early 1980s. Our Client understood that had Mr. Stephenson not dealt with his side o f the liabilities due, the £25,000 referred to by Mr. Traynor would have been appropriated by the Bank for debt reduction. Some tim e in the early 1980s Mr. Traynor informed our Client that the amount set aside by Mr. Traynor/Guinness & Mahon Bank still existed. Our Client was never advised at to the manner m which these funds were held, never received a statement or Annual Certificates o f Interest, was never advised that the funds were off-shore and nor did he receive any correspondence or information whatsoever in relation to these monies. The first occasion on which our Client received correspondence relating to the monies was when he was notified by Guinness & Mahon o f the Moriarty Tribunal on the 16* o f January 1998. It took our Client from January until March o f 1998 to establish the .../ -3 — ..J . person in Guinness ft Mahon from whom he could obtain information relative to his account. In March 1998 he met Mr. Collery who handed Um a number o f statements, copies o f which are attached. These are the only statements our Client has received. He subsequently received the booklet o f documents from Guinness & Mahon which contain the correspondence relating to the closure o f our Client's Caymen Account in 1976, other loans taken out by him and some unrelated matters. With regard to the specific queries at page 10 o f Appendix C: a. In relation to the earlier Account, our Client was informed o f the service by Mr. D es Traynor and Mr. Don Reid. Our Client is unaware o f Mr. Reid’s address and no correspondence exists other than that ftirnished herewith. Our Client believes that Mr. Reid was a partner in Stokes Kennedy Crowley, which firm advised Mr. Traynor. As stated above our Client was unaware that the second offshore deposit had been set 19 . He has no documentation relating to it other than as furnished and believes that it was set up by Mr. Des Traynor. b. & c.Our Client can not give any farther information or documentation in relation to the first account other than as set out above. Our Client cannot be specific as to when the second account was set up but it appears to have been some time in the mid 1980s. No sums were deposited by him. “He has no fiirther documentation other than that which has been furnished herewith. d. In relation to the first account, all transactions on the account were conducted by Mr. Traynor, who had an interest in the property transactions conducted by our C lient Withdrawals in relation to the second account were effected by our Client contacting Mr. Traynor. To be best o f our Client's recollection most withdrawals . received from Mr. Traynor were in cash. After Mr. Traynor’s death, our Client contacted Mr. Traynor’s secretary, Mrs. Joan W illiams who advised him that he should contact a Mr. Collery. Our Client could not contact Mr. Collery and ultimately contacted Sam Field Corbett who formerly worked in Guinness & Mahon. Money withdrawn after Mr. Traynor’s death was usually in cash although on one occasion a withdrawal was by means o f a cheque drawn on the Irish Intercontinental Bank. .4..J e. N ot to our C lient's knowledge. Our Client did receive a query from the Moriarty Tribunal by H ter dated 10 July 1998 relating to an account in the name o f Amiens S/L N o. 2 Account. A copy o f our response thereto dated 7* August 1998 is attached. f. A-A2. ' With regard to Irish Intercontinental Bank Limited, our Client was unaware o f this service except to say as stated above that one o f the cheques which he received was drawn on the Irish Intercontinental Bank. With regard to Item 4 on page 12, our Client did have loans from Guinness & Mahon for the purpose o f his practice as an Architect at 20 Harcourt Street. These bans, however, were unsecured and copies o f the documentation furnished to our Client are attached together with handwritten statement showing details o f interest and repayments made from our C lient's Practice. With regard to item 5 on page 12, our Client did art have any dealings with Irish Intercontinental Bank or Kreditbank N.V. other than as stated above. With regard to He™ 6 on page 13, our Client did not apply for Exchange Control in relation to any transactions. He is unaware as to whether or not any other person so applied. If any clarification o f the matters set out above is required, please do not hesitate to contact us. Yours fail A N S B A C H E R LIMITED P.O. Box 887 Qrand Caym an British W aal Indies fiS b a c h e r T a l a p b o n a N o . 9 — 4 6 5 3 /4 L la lte d C a y M it “"i Talax C P 305 C a b l a A d d r a s a Q u l n n a a a A/A2 J L_ 1 /10/92 3 0/ 9/92 ACCOUNT NUMBER 8 0 0 0 )0 2 5 PACE BAUM CCS SHOWN ARE IN: s t a r lin g 27 9 0 4 3 1 .9 6 5 1/1 0/9 2 96431.96 s_______ ____________ / P.O. Box 887 Grand Caym an Britlah W aal India* Telaphona No. 9— 4853/4 Talax C P 305 Cabla Addraaa Qulnnaaa Ansbacher U n ite d Caywui A/A2 J 10/11/93 11/13/93 31/13/93 V 31/13/93 BROUGHTFOHWAR0 I n t a r a a t t o 31/12/93 ACCOUNT NUMBER 8 00 01 02 3 BALANWH SHOWN AR8U* M M starling 38 98431.96 1838.43 100360.38 A N S B A C H E R LIMITED P.O. Box 887 Grand Caym an Brltiih Waat Indie* Talaphona No. 9— 4863(4 Talax C P 309 Cabla A d d ra u Qulnnea* IILTON SOSS A/A3 L il/ 0 1 /9 3 V J ACCOUNT NUMBER 8000X039 PAOE BALANCES SHOWN A M IN; s te rlin g 99183.38 [HAMILTON ham BOSS -'I u ACCOUNT NUMBER m w ih v m BALANCES SHOWN ARE K 31/03/97 01/04/97 30/04/97 01/04/97 BROUGHT FORWARD IEM O O O PAGE 22 *t a r lin g 107011.82 39 10.0 0 103101.82 APPWEIXV Guinness & Mahon Ltd., 17, College Green, DUHLIN. 2. : S .*— Dear Sira, - In consideration of yoy_ Placing at the disposal of HKBESIOED uiVJB’HOnTS LIMITED 29, Molesworth Street, Dublin, (hereinafter referred to as . "the Principals", which expresalon shall include the successors in title to the Principals) a loan facility of up to £72,500 (seventy-two thousand, five hundred pounda) on terma and conditiona set out in a letter dated 5th January, 1970 addressed by you to the Principala, we the underaigned L.D. McGonagle, K p. O'Reilly-Hyland, J.D. Traynor, J.J. Finnegan, S. Stephenson and Arthur Gibney hereby guarantee to you that in the event of the Principmla failing for any reaaon whatsoever to place you in funds, sufficient to.repay when due any loan or loana made or liabilities incurred under auch loan facility or failing for any reaaon whatsoever to pay you as and when the same ought to he paid any commission, interest, other charges and expenses, including legal cos.ts, payable to you under the terms of such loan facility, we shall forthwith demand remit to you the full amount of every loan or loans made or liabilities incurred then outstanding, together with an amount-equal to all commission, interest, grther charges and expenses, including legal costs, unpaid as aforesaid PROVIDED ALWAYS that the liabilities enforceable against us respectively under this guarantee shall not exceed in total 85% of any loss incurred by you in consequence of your loan and shall not exceed in the case of any one of us the sum of £1 0 ,0 0 0 . This guarantee shall not J>e considered as • satisfied by any intermediate payment.or satisfaction ' of the whole or any part of any sum or sums of money owing to you as aforesaid, but ahall be a continuing security and ahall extend to cover any aum or sums of money which shall for the time being constitute the balance due from the Principals to you under auch loan facility (Including all commission, interest, other charges and expenses, Including legal costs, payable to you by the Principals) and any admissl°n or acknowledgaient in • writing by the principals or any person authorised by * the Principals of the amount of the indebtedness of the Principals to you shall be binding and conclusive against us or our respective executors and legal personal representatives. We undertake this guarantee as principal debtors and not merely as this guarantee *nd your rights under it shall not be prejudiced or affected by your enlargingi r®®«cing, or varying the aforesaid loan facility, or by your holding now or hereafter any collateral, or oxaer security for all or for any part of the monies hereoy guaranteed or by your varying, releasing or omittinjf or neglecting to enforce any of the terms conditioo^g* such loan facility_____ f in d u lg e n c e to o r making any o th e r arra ngem e n ts w ith th e P r i n c i p a l s o r any person l i a b l e on a n y s e c u r i t i e s h e ld o r to be h e ld b y you. . I n th e e v e n t o f the P r i n c i p a l s g o in g in t o l i q u i d a t i o n we s h a l l n o t prove i n c o m p e titio n w ith you ■ i n su ch l i q u i d a t i o n i n re s p e c t o f a n y d e b t due from the P r i n c i p a l s to you as a fo re s a id , b u t s h a l l g iv e you the b e n e f it o f a n y p r o o f which we s a y be e n t i t l e d to make I n r e s p e c t o f a n y p a r t o f such d eb t p a id b y us u n t i l you have r e c e iv e d th e f u l l amount o f the s a id d e b t. No change whatsoever i n th e c o n s t i t u t i o n o f y o u r Company o r i n the c o n s t it u t io n o f th e P r in c i p a l s s h a l l Im p a ir o r d is c h a rg e o u r l i a b i l i t y u n d e r t h i s g u a ra n te e . ' A n y demand f o r the b y us h e re u n d e r may be made p o s t and*such n o t i c e s h a ll r e c e iv e d on th e day f o lio ' p o s te d . lyment o f a n y sum p a ya b le n o t ic e s e n t th ro u g h th e temed to have been le day on w hich l ,t was In. p r o v in g th a t a s h a l l o n ly b e n e c e s s a ry to , p r o p e r ly a d d re s s e d , stamped! re c o rd e d d e l i v e r y m a il . id was d u l y made I t [t h a t th e n o t ic e was is te d b y r e g i s t e r e d o r T h i s gu a ra n te e s u b s t i t u t i o n f o r a n y o th e r us o r a n y o f u s . I t i o n to and n o t i n g iv e n to you b y Appendix XV (46) Mr Francis P Glennon 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Francis Glennon. a) Letter of 7 January 1991 from Ansbacher Limited to IIB. b) Letter of 10 January 1991 from Ansbacher Limited to Guinness and Mahon. c) Letter of 5 March 1990 from Ansbacher Limited to Guinness and Mahon. d) Letter of 2 April 1990 from J D Traynor to Guinness and Mahon. e) Letter of 24 July 1990 from Ansbacher Limited to Guinness and Mahon. f) Letter of 12 October 1990 from Ansbacher Limited to Guinness and Mahon. g) Letter of 4 December 1990 from Ansbacher Limited to Guinness and Mahon. Correspondence received from or on behalf of M r Francis P Glennon. a) Letter of 17 August 2001 from Arthur C o x to Mary Cummins, Solicitor to the Inspectors. A Membero/lhtHenryAnsbachtr HaldbtgtKC MerchantAmkbifGroup p O. Box 1S7, Onnd Caynuu, British W « India ; . - V .*l\J , • Please reply to*- ’ Phone (M9) 949-4653/4 T abs CP 4303 F to (109) 949.7946 (809) 949-5267 42 Ftaw illiatn Square, Dublin 2. Tel: 765144/763065 Fax: 612035 7th Ja n u a ry , 1991 Gareth Logan, Esq., T«-4#-«d Irish Intercontinental Bank Limited, 91 Merrion Square, D U B LIN 2 . i Dear Gareth, Stgx«fl80 ,000i00 payable to MiRr*OTfaktK GlehhOn. Please debit the cost to our Account No..010B7-02r8 1 V O Yours sincerely, T-D- Travnor. * v \e & JD T/ A JW C\V ^\\e A Mtmbtr e ft hi Hmry Ambaehtr HoUBngt Please reply to: 42 PTtrwDliam Square, Dublin 2. Tel: 765144/763065 Rue 612035 P.O. Box 887, Grind C*ynm«, Bffebh West fawn Phone: (109) 949-4653/4 TekJC CP 4305 F tx (809) 949-7944 (809) 949-3267 10th January, 1991 C. Waite, Esq., Guinness A Mahon Limited, 17 College Green, DUBLIN 2. 15:16 y'' NeikKtMMtirawy A Hftmkt* j to* PA to* 1*7. Onatf Ctyma. MWi Ww M a Please reply to: M k O I W 42 fTtrwilliam Squme, Dublin 2. nuc- iH « „ „ M I N I M a 'V . . ^ s JDT/AJW To g i v e n o t ic e o f t h i s r e t i r e m e n t a copy o f t h i s l e t t e r i s b e in g s e n t b y f u * . Any problem s - p le a s e 'p h o n e . 42 FITZWtLUAM SQUARE « t 7M I 44/763066 ^esknifi*: 612035 DUBLIN 2. 2nd A p r i l , 1990 M. D a v id H u m p h rie s , E s q . , S e n io r Manager - O p e r a t io n s , ' G u in n e s s ft Mahon L i m i t e d , 17 C o lle g e G re e n , DUBLIN 2. D ear D a v id , C o u ld yo u p le a s e a rra n g e f o r th e t r a n s f e r o f IR £ 5 ,0 0 0 to A l l i e d I r i s h Banka, 12 S t . S te p h e n 's G reen, D u b lin 2 , f o r c r e d i t o f th e A c c o u n t o f F r a n c is P . G le n n o n , E s q ., A c co u n t N o .10387035. Th e d e b i t s h o u ld b e t o Kontford S e c u r i t i e s L im it e d A c co u n t N o .12460002. Y o u rs s i n c e r e l y , J .D . Tra vn o r A n s b a c h e r Limited A Mtmbtr tfti* Hmny Ambadm HoUfngt ftC Mtrchartt Matting Group Please reply to: 42 Fitrwfllkm Square, Dublin 2 Tel: 765144/763065 Fax: 612035 P.O. Box SS7, Gnnd Cayman. British W ot Indies Phone (109) 94MCS3/4 Take CP 4309 Fax: (W9) Mfr-7946 (809) 949-3267 2 4 th J u l y , 1990 M . D a v id H u m p h rie s , E s q . , S e n io r M anager - O p e r a t io n s , G uinn ess * Mahon L i m i t e d , 17 C o lle g e G re e n , DUBLIN 2 . D e a r D a v id , C o u ld yo u p le a s e a r ra n g e t o t r a n s f e r IR £ 5 ,0 0 0 .0 0 t o A l l i e d I r i s h B a n k s, 12 S t . S te p h e n 's G re e n , D u b lin 2, f o r c r e d i t o f th e A c c o u n t o f F r a n c is P . G lennon A c c o u n t N o .10387035 P le a s e a rra n g e t o d e b i t th e S t e r l i n g c o s t t o A n sb a c h e r L i m i t e d A c c o u n t N O .1 3 T5 4 6 0 2 . Y o u rs s i n c e r e l y . — ■ — ^ ^CXAs. .......... ....... ~7 A n s b a c h e r L i m i t e d rfsfLC MtrchmttBaking Group iiyjt nr»~I Cayman, Brithfe W at *■«— Phone OW) 94M 6S3/4 T doc CP 4305 Please reply to: 42 FitzwflUam S< Dublin 2. Td: 765144/763065 Fax: 612035 Rue009)MR-7M6 (■09) 949-5267 1 2 th O c t o b e r , 1990. M . D a v id H u m p h rie s , E s q . , S e n i o r M an age r - O p e r a t io n s , G u in n e s s & Mahon L i n i t e d , 17 C o ll e g e G re e n , D U B L IN ? . D e a r D a v id , could y o u p i . . . . . r r , n ? . _ t o t r . a . f ^ W . S O O . O ^ f r o - ^ e h . r l i m i t e d A c c o u n t N o . 13154602 t o t h H r . F . G le n n o n . Y o u r s s in c e re ! j . D . Tra v n o r / w fr C u a ibachcr L i m i t e d XCMuthanl Jknklng Group Ctjmu, BridthWat tafa Please reply to 42 Fitzwffliam Dublin 2. Tel: 765144/76: Fax: 612035 ftoBK OW) 949-4633/4 Trine CP4309 Flue (SOS) 949-946 009) 9494367 M. D a v id H u m p h rie s , E s q . , . S e n io r M anager - O p e r a t io n s , G u in n e s s A Mahon L im it e d , 17 C o lle g e G re e n , DPBLIW 2 . / D e a r D a v id , C o u ld yo u p le a s e a rra n g e the t r a n s f e r o f S t g . £ 2 ,5 0 0 from A n s b a c h e r L im it e d A c co u n t N o. 13154602 t o t h e A c c o u n t o f M r. F ra n k G le n n o n . ' / To u rs s in c e r e ly , J .D . Tra v n o r. / ** * ARTHUR COX I:ARl.SI:ORT IlARI.irORT THRRACH, Dl’ HI.IN 2 fix +353 1 618 0000 I-ax +353 I 618 0618 Dx 27 D i'HI.in H i iIv.-1 Stokls 1lot ?r, 17-25 Coi iu.i: Sot arl I£.\s=t in ioiid Tci.iI'UDNi: +4-1- 28 0023 0007 i:vx +44 28 ‘ >023 3464 Ni-:\v Y ork ■ 570 I.i:\inc.ton Avi ni i:,28iii Floor N iw York,NV 10022 Ti.u;moNi: +1 212 759 0808 Fax +1212 688 3237 RW/lc Direct Dial: 618 0530 17th August, 2001 STRICTLY PRIVATE & CONFIDENTIAL f"*'- M s Mary Cummins Solicitor Office of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Ltd 3rd Floor Trident House Blackrock C o Dublin Re: 7 Francis P. Glennon, deceased Dear M s Cummins, I refer to the letter from the Inspectors dated 31st July addressed to M r David A Glennon and I wish to notify the Inspectors that m y clients, David A Glennon and Frank Glennon Limited, wish to reply to the preliminary conclusion reached by the Inspectors in relation to Francis P. Glennon, deceased. Firstly, on a point of clarification, m y clients would request that all references to the late M r Glennon should read “Francis P. Glennon, deceased”, in order to distinguish him from M r Frank Glennon (junior), one of his sons. M y clients consider that the statement of preliminary findings of the Inspectors (enclosed with the Inspectors’letter) and/or the inferences that m a y be drawn therefrom, as presently worded, are adverse to the interests, good n a m e and/or reputation of the late M r Glennon and Frank Glennon Limited. It is m y clients’opinion that the available evidence clearly shows that the late M r Glennon was not a resident of Ireland at the relevant times in relation to this matter, having left Ireland in 1984 approximately, with Exchange Control clearance from the Central B a n k of Ireland and with clearance from the Revenue Commissioners. Therefore, it is m y clients’strongly held view that any statement of a finding that the late M r Glennon was a client of Ansbacher should include a statement to the effect that at all relevant times M r Glennon was not resident in Ireland and had transferred his assets abroad with clearance from the Central B a n k of Ireland and the Revenue Commissioners. /amls O’ Dwyi-r Put Mci.Arc.iiiin I.\n A. Sh u t John g .Fisii Daniii H. O'Connor Pi:ii:h M cLuyiu in Rohlrt Holton John V O'Dwyiir Roman YTai.sii Higlni:R Fanning I)onog ii C kowlly John s ,Walsh M hiiaki. M iyih-.n Join'll I.i;yim-:n W illiam Johnston H iylnl M cCa g u : N icholas G. M oori-: D i:clan H ayls Daud O'Donoiioi: Colm Di y g w C\ri.O'Sn.uvw Is.\i;il Foily John M ia m : Conor M cDonnii.i. Patrick M cG ovlrn G rainnl H i-nnlssy SiU mcs G ivkn Colin Byrni-: Caroi ;ni:Diahn (j\ran Hoi.gi k G kiyory G lynn D.wid Fohy Stli’ iiln H iyariy I)lyl\n Drisi.vni: Sarah CYnniit ICmiii iln G arriht Paoraig O Riorijain D r.M ary Richmond Hii/.w ;i:iii iUvniw iii Ni \\ih Hruui \\'ii11\m D vy Andri w I.lnny John M in ion Patrick O H riln O rla O ’ Connor B rian O ’ G orman M ark Sacndkrs C()N?l NANIS; VlNCI.NI \X'\ISll DlNIS J. HlkYIN ClILIWODI IIaMHION NlAI.L M c I.AIYIIMN Dr.YVONNL SCANNU.I. Dk. Ro UKRT O.ARK M y clients are also strongly of the view that the reference to “Frank Glennon Limited”in the third paragraph of the letter of 5th March 1990 from J D Traynor to David Humphries of Guinness & M a h o n Limited should be deleted (in the same w a y as references to other names have already been deleted by the Inspectors from the second paragraph and third paragraph respectively of that letter). It is submitted by m y clients that the above alterations to the statement of preliminary findings of the Inspectors are required in order to protect the interests, good n a m e and reputation of Frank Glennon Limited, a long-established c o mp a ny which continues to do business under the n a m e “Frank Glennon”and to which substantial goodwill attaches. These changes are also required in order to protect the good n a m e of the late M r Glennon. M y clients feel that it is not unreasonable to request the Inspectors to m a k e these changes in order to more fairly reflect the evidence in relation to the late M r Glennon in the context of the Inspectors’investigation and their report, which most likely will be m a d e public, in due course. M y clients would respectfully request the Inspectors to m a k e the changes referred to above in their statement of findings which will form the basis of their report to the High Court (insofar as the late M r Glennon is concerned). I should be grateful to hear from you further in this regard, in due course. Yours sincerely, Appendix XV (47) Mr Paul Goode 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Paul Goode. a) Internal Guinness and Mahon memo o f 1 June 1978. b) Undated letter from Orbit Investments Limited to Mr Paul Goode. TOi ANNA DOWD. FROMi T . R . L . ^ ^ R E i DRBIT INVESTMENTS LTD., Th a b e n e f i c i a r y o f t h i a Company I s now a M r. P a u l Good*. A l l c o rre s p o n d e n c e t o M r.G oode muat be handad t o A n n e tte B e e ch e r f o r p o a t in g . A l l o t h e r aapecta o f th e O r b i t eccoonta rem ain un ch a n g e d . TRLiAB 1 s t . J un e/1 97 8. i i O R B IT Takphonr 9-4633/4 Trim CT3QS IN V E S T M E N T S • L TD . PJ.BoxM 7 Grand Cayman Cayiwn Mandt MMiWntlmfla* Paul Goode Esq., Haras 4a Clarbec, 14130, Pont L'Eveque, FRANCE Dear Mr. Goode, ORBET INVESTMENTS Is giving the permission to the trainer Jeen-MicJiei de CHOUBERSKY to sell the horse PUTTING and to endorse the carte d'immatriculetlon. Yours sincerely, Appendix XV (48) Mr Christopher Goosen 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Christopher Goosen. a) Transcript of evidence of M r Christopher Goosen dated 12 July 2000. b) Letter of 30 July 1990 - Ansbacher Limited to Guinness and Mahon. c) Letter of 15 October 1990 - Ansbacher Limited to Guinness and Mahon. d) Letter of 12 December 1990 - Ansbacher Limited to Guinness and Mahon. e) Letter of 17 September 1990 - Ansbacher Limited to Guinness and Mahon. 1) Ansbacher C a y m an Limited current a/c statement of 4 November 1996. g) Ansbacher C a y m an Limited current a/c statement of 22 April 1996. h) Ansbacher C a y m a n Limited current a/c statement of 18 December 1995. i) Ansbacher C a y ma n Limited current a/c statement of 28 September 1995. j) Ansbacher C a y m a n Limited current a/c statement of 11 August 1995. k) Ansbacher C a y m a n Limited current a/c statement of 31 M a y 1995. 1) Ansbacher C a y ma n Limited current a/c statement of 27 March 1995. m) Ansbacher C a ym a n Limited current a/c statement of 1 October 1994. n) C a y m a n International Bank & Trust C o Limited current a/c statement of 8 August 1994. o) C a y m a n International Bank & Trust C o Limited current a/c statement of 20 June 1994. p) C a ym a n International Bank & Trust C o Limited current a/c statement of 11 April 1994. q) Ca y m a n International Bank & Trust C o Limited current a/c statement of 7 February 1994. C a y m a n International Bank & Trust C o Limited current a/c statement of 30 December 1993. C a y m a n International Bank & Trust C o Limited current a/c statement of 18 October 1993. Ansbacher C a y m an Limited current a/c statement of 11 M a y 1992. Ansbacher C a y m an Limited current a/c statement of 15 February 1991. Statement of M r Christopher Goosen dated 27 October 2000. ?w 7 I UNDER OATH ON WEDNESDAY 12TH JULY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. M A C K E Y BL S ol i c i t o r to the I n sp ec to rs MS. M. C U M M I N S Interviewee: MR. CHRIS GOOSEN WITNESS MR. C. GOOSEN I EXAMINATION MR. JUSTICE COSTELLO PAGE 46 1 2 3 4 5 MR. JUSTICE COSTELLO: Mr. Goosen, we will start our i n t e r v i e w then. 6 7 s h o u l d e x p l a i n to y o u t h a t t h i s is n o t a C o u r t 8 hearing. 9 investigation. It is n o t a T r i b u n a l . I It is an 10 11 M y n a m e is D e c l a n C o s t e l l o a n d o n m y r i g h t is 12 Ms. 13 h a v e b e e n a p p o i n t e d I n s p e c t o r s b y T h e C o u r t h e r e in 14 Dublin. Mackey. A s y o u k n o w f r o m o u r c o r r e s p o n d e n c e we 15 16 I s h o u l d e x p l a i n Mr. 17 i n t e r v i e w s u n d e r o a t h a n d I a s k o u r s o l i c i t o r now, 18 Ms. 19 20 21 22 23 24 25 26 27 28 29 Cummins, Go o s e n that we have these t o a d m i n i s t e r t h e o a t h t o you. 1 2 3 4 MR. JUSTICE COSTELLO: Mr. 5 letter, 7 the 8 A. 9 1 Q. 10 A. 11 2 Q. 12 A. 13 3 Q. 14 A. 15 the o r i gi nal letter, I t h i n k the o n l y letter, yes. On the 4 t h ...(I N T E R J E C T I O N ) ? Is it t h e 8 t h J u n e ? T h e r e is o n e o f t h e 4 t h M a y ? Sorry. Have you got that? No. MS. No, I d o n 't . CUMMINS: T h e r e is a c o p y of it (Same H a n d e d ) 17 A. 18 4 Q. ( E x h i b i t 1). T h a n k you. MR. JUSTICE COSTELLO: 19 W o u l d y o u j u s t l o o k at l e t t e r of 4 t h M a y ? 20 Have y o u g o t it t h e r e ? 21 A. 22 5 Q. Yes. W o u l d y o u j u s t l o o k at A p p e n d i x C of t h a t l e t t e r . 23 It is a b o u t t h e t e n t h p a g e 24 tha t , 25 A. 26 6 Q. 29 t h a t w e w r o t e to you, f i r s t l e t t e r w e w r o t e to y o u ? 16 28 have you got there in p ap ers the 6 27 Goosen, Yes, I think. Have you got a p p e n d i x C? I t h i n k so, yes. D o y o u s e e w e a s k e d y o u that: "You sh o u l d p rov i d e a full a nd d e t a i l e d s t a t e m e n t o f al l t h e d e a l i n g s w i t h t h e C o m p a n y ..." 1 2 Guinness Mahon Cayman Trust Limited and then later 3 called Ansbacher. 4 " . . . h a d w i t h you, w h e t h e r d i r e c t l y or indirectly. This should include d e t a i l s o f t h e m a n n e r in w h i c h s e r v i c e s were s u p p l i e d b y the Company, the dates on which they were supplied, the names o f t h e p e r s o n o r p e r s o n s w h o a c t e d on b e h a l f o f t h e C o m p a n y in s u p p l y i n g t h e m and the names of your p r o f e s s i o n a l a d v i s e r s ..." 5 6 7 8 9 10 Y o u d i d n o t c o m p l y w i t h t h a t r e q u e s t Mr. 11 But I w r o t e to yo u s a y i n g that 12 anything. 13 7 Q No. correspondence. 15 full and d e t a i l e d statement? A 17 18 Well, However, we were as k i n g you for a I t h i n k t h a t is m y s t a t e m e n t w i t h r e s p e c t , that I don't have anything. 8 Q 19 Wh a t do you m e a n ? We are not as k i n g you what you have? 20 A 21 9 Q 22 23 I didn't have You wrote saying that you did not have any 14 16 Goosen? Yes . W e a r e a s k i n g y o u fo r a l l t h e d e a l i n g s w i t h t h e Company? A Sorry. I m a y r e a d it a g a i n . W e ll, I must say that 24 I didn't parti c ul a rl y understand that you were 25 e x p e c t i n g to get a s t a t e m e n t 26 10 Q 27 A 28 29 Did you not? But, as I h a v e s a i d in m y l e t t e r t o y o u n o w a n d w h y I a m her e , 11 Q from me there. Yes? I a m h a p p y to h e l p in a n y w a y t h a t I can. 1 2 12 Q. 3 A. 4 5 I doubt that I h a v e -- I r e a l l y d o u b t t h a t I h a v e a n y i n f o r m a t i o n r e l e v a n t to you. 13 Q. F i r s t o f all, you did have dealings with A n s b a c h e r Cayman, 6 7 You doubt what? A. 8 The c o m p a n y that well, 9 14 Q. 10 A. 11 15 Q. 12 A. did you not? I was i n v o l v e d w i t h I b e l i e v e - ­ had dealings with Guinness Yes? T h e r e is n o d o u b t a b o u t that. W h a t a b o u t i t s s u b s i d i a r y in t h e C a y m a n I s l a n d s ? I think that through Guinness 13 were dealings with Guinness 14 Islands but 15 16 Q. & M a h o n in Dublin. Perhaps, I really don't & Mahon Dublin there & M a h o n in the C aym an k n o w m u c h a b o u t tha t . n o w t h a t y o u k n o w w h a t w e w a n t Mr. Goosen 16 y o u m i g h t m a k e a s t a t e m e n t n o w to us as t o w h a t y o u r 17 personal dealings were with Guinness 18 Cayman Island company? 19 A. 20 17 Q. 21 A. 22 18 Q. 23 & M a h o n in t h e I h a v e no p e r s o n a l d ealings. Y o u h a v e no p e r s o n a l d e a l i n g s ? No. W h a t a b o u t t h e c o m p a n y S u p e r Ser, d i d it h a v e a n y dealings ? 24 A. 25 19 Q. 26 A. 27 20 Q. Are you f a m i lia r wi t h m y p o s i t i o n w i t h i n Super Ser? No, I a m g o i n g to a s k y o u a b o u t t h a t i n a m o m e n t ? Yes. Before that I w o u l d l i k e y o u j u s t t o a s s i s t us in a 28 general 29 Guinness Mahon Cayman Trust? statement. Did Super Ser have d eal i n g s with 1 2 21 Q. 3 A. 4 22 Q. In D u b l i n ? 5 A. In Dublin, 6 23 Q. 7 Not to your knowledge. The c o mp any 's dea li ng s were w it h Gu inn e s s & Mahon. yes. It h a d n o d e a l i n g s to y o u r k n o w l e d g e w i t h Guinness Mahon Cayman Trust? 8 A. 9 24 Q. 10 A. 11 25 Q. 12 A. 13 26 Q. No. D i d it c o m e . . . ( I N T E R J E C T I O N ) ? A n d ce r t a i n l y none that No, I a m n o t t a l k i n g a b o u t i n v o l v e d in? Yes. I a m t a l k i n g a b o u t y o u r k n o w l e d g e of w h e t h e r t h e 14 Company, 15 d e a l i n g s w i t h it? 16 A. 17 27 Q. I w a s i n v o l v e d in. w h i c h w e w i l l c o m e to in a m o m e n t , Did you not had any know about that? No. D i d it c o m e as a s u r p r i s e to y o u t h e n t o b e t o l d 18 that Super Ser Limited might have been involved 19 i t s e l f as a C o m p a n y w i t h t h e C a y m a n I s l a n d s ? 20 A. 21 I don't think that Super Ser Limited was involved with Cayman Islands. 22 28 Q. 23 A. I see. You p e r s o n a l l y ...(I N TE R JE C TI O N) ? If I c o u l d j u s t s a y t o y o u S i r t h a t I w a s - ­ 24 although I was a Director m y part was really based 25 i n t h e UK. 26 2 9 Q. W e w i l l c o m e t o t h a t in a m o m e n t . I j u s t w a n t to 27 get a g eneral p i c t u r e 28 p e r s o n a l l y y o u r s e l f had no dealings, 29 the Company? f i r s t Mr. Goosen. You y o u say, with 1 2 Perhaps, 3 Mr. 4 Super Ser Limited and any other company that you m ay 5 h a v e b e e n i n v o l v e d w i t h h e r e in I r e l a n d ? 6 A then you might just give me a summary Go o s e n of your i n v o l ve me nt Certainly. in t h i s C o u n t r y w i t h I am not p in sharp on dates, y o u know. 7 I b e l i e v e t h a t t h e d a t e s -- I h a v e t r i e d t o i m a g i n e 8 w h a t it w a s y o u w a n t e d f r o m m e a n d I h a v e t h o u g h t 9 a b o u t t h e d a t e s t h a t w o u l d b e r e l e v a n t and, as I 10 said, 11 h a v e n ' t b e e n w o r k i n g f r o m a n y r e c o r d s or a n y t h i n g . 12 31 Q 13 A I might not be strictly accurate because I Yes ? B u t I t h i n k t h a t S u p e r S e r in I r e l a n d p r o b a b l y 14 started about 15 that I was a shareholder and a Director, 16 w a s n ' t t h e b o s s b y a n y s t r e t c h of t h e i m a g i n a t i o n . 17 I s o r t o f w o r k e d f o r it u n t i l 18 t h e UK. 19 32 Q 20 A 1 9 6 7 a n d I w a s a c o - f o u n d e r of it, in although I 1 9 7 0 w h e n I m o v e d to Yes? W h e n I m o v e d to the U K I s t a r t e d a c o m p a n y up t h e r e 21 t h a t w a s a w h o l l y o w n e d s u b s i d i a r y of S u p e r S e r 22 Limited, 23 moment 24 Ireland. 25 Yes ? 26 The c o m p a n y in the UK was S u p e r Ser 27 t h e n at a l a t e r date, 28 date, 29 another UK company called Impact Heaters Limited. the Irish company, and rea l l y from that I h a d n o d i r e c t d e a l i n g s w i t h S u p e r S e r in but (UK) Limited and I c a n ' t b e s u r e of t h e s o m e w h e r e b e t w e e n 1 9 7 0 a n d 1978, t here was I 1 c a n ' t r e a l l y r e m e m b e r w h e t h e r U K w a s i n t h a t one. 2 I m p a c t H e a t e r s L i m i t e d I t h i n k it was. 3 t h i n k t h e r e w a s a U K in it. 4 34 Q. 5 A. I don't Yes? So, t h a t is m y i n v o l v e m e n t w i t h it, y o u know. 6 i n t h a t t i m e f r ame, 7 w o r k i n g for S uper Ser He ate rs UK Limited. 8 35 Q. 9 A. f r o m 1970, So, I was in the UK Yes? U n t i l I t h i n k 1 9 8 1 or u n t i l 1 9 7 9 -- sorry, until I 10 t h i n k 1979. 11 t h e n s u b s e q u e n t l y c o m e b a c k to it f o r a s h o r t time. 12 I t h i n k it f i n a l l y c e a s e d , 13 i n 1 9 83. 14 what p a r t i c u l a r time frame you are s p e c i f i c a l l y 15 i n t e r e s t e d in. 16 36 Q. 17 A. 18 37 Q. I t hink I left the c o m p a n y but I did w e n t o u t of e x i s t e n c e , I r e a l l y have no idea about, y o u know, Yes? B u t p r e s u m a b l y it is s o m e w h e r e in t h a t span. W a s t h e c o m p a n y i n c o r p o r a t e d in I r e l a n d as Super Ser Limited? 19 20 A. 21 38 Q. 22 A. 23 39 Q. 24 The ori gi na l Yes. No, A. 26 40 Q. 27 A. 28 41 Q. 29 A. yes. Who were your solicitors, Sir, do you rem emb er ? I don't. Y o u do not remem b e r . y o u r s e l f Mr. 25 c o m p a n y was, Had you l i ved in Ire la nd Goosen? U n t i l t h a t tim e , yes. Y o u h a d l i v e d in I r e l a n d ? Yes. H a d y o u b e e n b r o u g h t u p in I r e l a n d ? Yes, I was. Well, Were you Irish? I w a s b o r n in N o r t h e r n I r e l a n d . 1 42 Q 2 A 3 43 Q 4 A 5 W e n t t o s c h o o l r i g h t h e r e in B l a c k r o c k . Yes ? A n d I w o r k e d i n D u b l i n in t h e m o t o r c y c l e t r a d e fo r a p e r i o d o f tim e. 6 44 Q 7 A Yes? A n d then I left Ire lan d for the m o t o r cycle c razy 8 profession, 9 y e a r s a n d t h e n r e t u r n e d to s t a r t t h a t b u s i n e s s , 10 Super Ser business, 11 45 Q 12 A 13 46 Q 14 A 15 Yes. 47 Q 17 A 18 48 Q 19 for I t h i n k three Lindsay? T h a t is c o r r e c t . D i d y o u e a c h h a v e a 50% i n t e r e s t i n t h e c o m p a n y ? Yes, it w a s 5 0 / 5 0 a l t h o u g h h e h a d t h e -- I t h i n k is t h e t e r m i n o l o g y of it. W h o w ere the Direc tor s of the company? I t h i n k j u s t t h e t w o of us. Yes. T h e b u s i n e s s w a s s t a r t e d in 1967 then, you think about that time? 20 A 21 49 Q 22 Yes, I t h i n k so. W h e n y o u m o v e d to E n g l a n d d i d y o u c o m e b a c k to I r e l a n d for D i re cto r' s m e e t i n g s ? A No, no. W h e n I m o v e d to E n g l a n d I r e a l l y m o v e d to 24 England but 25 t h e c o m p a n y h e r e as s u c h a l t h o u g h I m a y h a v e 26 b e e n . . . (INTERJECTION). 27 50 Q 28 A 29 the w h e n I h a d e n o u g h of it. Y o u s t a r t e d w i t h Mr. "casting vote" 16 23 of m o t o r cycle racing, I h a d n o t h i n g to do w i t h t h e r u n n i n g of W e l l . . . (INTERJECTION)? I m a y h a v e b e e n b a c k on o c c a s i o n s . l i v e d her e . My parents still 1 51 Q. 2 A. 3 Yes? A n d I m a y have b e e n b a c k on o c c a sio ns but ve r y b r i e f visits . 4 52 Q. 5 A. 6 53 Q. D i d y o u r e m a i n a 50% s h a r e h o l d e r i n t h e C o m p a n y ? Yes. Yes. D i d a n y b o d y e l s e c o m e in as a D i r e c t o r o f t h e 7 C o m p a n y o r d i d y o u a n d Mr. 8 Di r ec to rs of the Co mpany? 9 A. 10 11 T o m y k n o w l e d g e n o b o d y e l s e c a m e in. I t h i n k we remained. 54 Q. 12 Yes. The UK C o m p a n y that was formed, that was a s u b s i d i a r y of the Irish c ompany? 13 A. 14 55 Q. Yes. So t h a t a n y p r o f i t Company, 15 16 A. 17 56 Q. 18 it m a d e w e n t i n t o t h e p a r e n t the Dublin Company? Yes. W o u l d t h e s a m e a p p l y to t h e o t h e r one, the Impact Heaters Limited? 19 A. 20 57 Q. 21 A. 22 58 Q. 23 A. 24 59 Q. 25 A. 26 60 Q. 27 A. 28 61 Q. 29 L i n d s a y r e m a i n as Yes. It w a s a l s o o n e ? Yes. Did you then reside in E n g l a n d since then? Yes. Is t h a t t h e p o s i t i o n ? Yes, indeed. Y o u b e c a m e a t a x p a y e r in E n g l a n d , Yes, indeed. Did y o u . . . (INTERJECTION)? not in Ireland? 1 62 Q. 2 A. 3 63 Q. 4 A. 5 64 Q. 6 Yes? T h e c o m p a n i e s a l s o p a i d t a x in E n g l a n d o b v i o u s l y . The c o m pan ie s that were i n c o r p o r a t e d in Eng lan d? Yes. Yes, of course. D i d y o u t a k e u p r e s i d e n c y in England then? 7 A. 8 65 Q. 9 A. 10 Yes. W h e r e d i d y o u r e s i d e Mr. Goosen? I n t h e t o t a l s o r t o f 30 y e a r p e r i o d I h a v e l i v e d in three houses. 11 66 Q. 12 A. Yes? F i r s t l y in Dowridge, at 11 E a r l s w o o d Road, 13 a n d t h e n -- I t h i n k t h a t w a s 14 o r s o m e t h i n g l i k e that, 15 F u r l o n g Field, 16 67 Q. 17 A. 18 68 Q. 19 A. 20 21 for about three years two or three years. T h e n at T a m w o r t h on Arden. Yes? F o r I t h i n k 12 y e a r s a p p r o x i m a t e l y . Yes? And then where I l i v e now, w h e r e I h a v e b e e n fo r 15 y e a r s . 69 Q. Yes. W h e n S u p e r S e r f i n i s h e d its b u s i n e s s 22 Ireland, 23 come b a c k to? 24 A. 25 70 Q. 26 No, A. 28 71 Q. did you have any business in i n I r e l a n d to Sir. H a d y o u a n y r e a s o n t h e n to c o m e b a c k t o I r e l a n d f r o m t h e n on? 27 29 Dowridge H a d y o u f a m i l y s t i l l to v i s i t ? O n l y u n t i l m y m o t h e r die d . W h e n was that? 1 72 Q 2 Y o u w o u l d c o m e b a c k to v i s i t h e r t h e n f r o m t i m e to time. 3 A 4 73 Q 5 A 6 74 Q 7 A 8 75 Q 9 10 Yes. Were these regular visits? Not really. O n c e a y e a r o r so? Too i r r egular really. Yes? S h e u s e d t o v i s i t m e r a t h e r t h a n m e v i s i t her. H o w o f t e n w o u l d y o u c o m e b a c k to I r e l a n d t h e n a f t e r Super Ser finished? A I t h i n k t h e r e w a s p r o b a b l y a p e r i o d of f o u r o r f i v e 11 y e a r s w h e n I d i d n ' t at all. 12 r e a l l y i n t h a t -- I c a n r e a l l y o n l y r e c a l l a b o u t 13 t h r e e v i s i t s to Ireland. 14 76 Q Yes. I see. F r o m w h a t y o u a r e i n d i c a t i n g to us 15 Mr. 16 running the Irish business 17 right? 18 A 19 77 Q 20 21 G o o s e n y o u w o u l d h a v e h a d l i t t l e or n o h a n d in T h a t is so, Before 22 Before f r o m 1 9 7 0 's, is t h a t yes. 1 9 7 0 h a d y o u a s s i s t e d in r u n n i n g t h e business, A I w o u l d t h i n k m a y be t h i s is w h e n y o u w e n t t o E n g l a n d ? 1 9 7 0 I h a v e g o t to s a y I r e a l l y d i d r u n it, t h e d a y - t o - d a y r u n n i n g o f it. 23 78 Q 24 A Yes ? I n t h a t I t h i n k I w a s t h e o n l y e m p l o y e e of it. 25 it s t a r t e d u p it w a s Mr. 26 i d ea. 27 in the m o t o r c y c l e trade. 28 Suzuki m otor cycles and I was a representative 29 him. L i n d s a y ' s idea, When a very good H e w a s i n -- I h a d p r e v i o u s l y w o r k e d f o r h i m He w a s a n i m p o r t e r of fo r He was s till v e r y i n v o l v e d in the m o t o r c y cle 1 t h i n g an d to b e g i n w i t h this b u s i n e s s was v e r y v e r y 2 small. 3 79 Q. 4 A. 5 Yes? H o w it b e g a n w a s b a s i c a l l y I h a d o n e h e a t e r in t h e b a c k o f a c a r a n d w e n t a n d s o l d it. 6 80 Q. 7 A. 8 81 Q. 9 A. 10 82 Q. 11 A. 12 83 Q. Yes? A n d t h a t w a s h o w it s t a r t e d . W e r e y o u a n e m p l o y e e of t h e C o m p a n y ? Yes. You were a c tually p a i d your wage by the Company? Yes. Wa s he an e m p l o y e e a n d d i d he get p a i d a w a g e or di d he g i v e . . . ( I N T E R J E C T I O N ) ? 13 14 A. 15 84 Q. You cannot say? 16 A. I don't recall. 17 85 Q. 18 A. 19 I c a n ' t h o n e s t l y say. W h o . . . (INTERJECTION)? I d o u b t it b e c a u s e to b e g i n w i t h at t h a t stage, are just t a l k i n g a bout the first t h r e e years. 20 86 Q. 21 A. 22 87 Q. Yes? H e d i d n ' t r e a l l y w o r k in it. I am just w o n d e r i n g who looked after the financial 23 e n d a n d t h e a d m i n i s t r a t i o n e n d of t h e C o m p a n y ; 24 yo u or he or b o t h ? 25 we A. did I can tell you that wh e n we s t a r t e d I i m p o r t e d the 26 product. I sold the product. 27 product. I c o l l e c t e d the m o n e y for the p rod u c t and 28 at t h a t s t a g e t h e b o o k k e e p i n g w a s d o n e b y t h e o f f i c e 29 of t h e m o t o r c y c l e b u s i n e s s r e a l l y . I i n v o i c e d the I think they 1 2 88 Q. 3 A. 4 89 Q. 5 A. Yes, 6 90 Q. Yes? 7 A. Yes, What m otor cycle business was that? Lind s a y Motors. Mr. Lindsay's? yes. a n d the n , y o u know, it w a s a b u s i n e s s w i t h g o o d 8 potential but obviously even better potential 9 t h e UK. 10 t h e UK, 11 i n t r o d u c e it t h e r e . 12 91 Q. So, I w e n t t o t h e UK, I am just w o n d e r i n g about your contact with Guinness 14 did you mak e contact, 15 Guinness A. or i n i t i a l l y w e n t to t o t a k e a l o o k a n d s e e w h a t c o u l d b e d o n e to 13 16 in & M a h o n h e r e in I r e l a n d Mr. Goosen. person a l l y yourself, When with & M a h o n h e r e in I r e l a n d ? I t h i n k wh e n we v e r y first s t a r t e d i n i t i a l l y the 17 B a n k -- s o r r y , 18 straightaway but 19 B a n k of I r e l a n d S t e p h e n ' s G r e e n w h i c h was the B a n k 20 t h a t t h e C o m p a n y h a d to s t a r t wit h . 21 92 Q. 22 A. 23 93 Q. 24 A. 25 94 Q. 26 A. it is n o t a n s w e r i n g y o u r q u e s t i o n I t h i n k it m i g h t h a v e b e e n t h e Yes? Then do you r ecall w hen the Irish b a n k strike was? Just continue? Because.. . (INTERJECTION). Just continue? B e c a u s e t h a t w a s t h e d a t e o f s t a r t i n g t h e c o m p a n y in 27 the UK and the Irish Company had been profitable and 28 h a d m o n e y in its b a n k account, 29 B a n k o f I r e l a n d in S t e p h e n ' s G r e e n , I b e l i e v e in the and when I went 1 to the UK to start the Company -- when I needed 2 finance, when I needed funds, we couldn't get it 3 because the banks were on strike in Ireland. 4 remember that because it was so unusual and I think 5 that was the occasion perhaps. 6 been the date, whatever that date was, that 7 Mr. Lindsay went to I think the Merchants Bankers. 8 Were they Guinness & Mahon at that stage? 9 95 Q. yourself? 11 Guinness & Mahon? A. 13 96 Q. 14 A. 15 97 Q. 17 A. 18 98 Q. 19 A. 20 99 Q. 21 A. 22 I think I -- I can't recall. Yes? But I can't recall but at a guess I would say it was That what? That I probably met them or had to meet them. Who did you meet? Or I probably had to sign or something like that. Who did you meet? 100 Q. No. I can't remember. Then the second or third or forth time what do you recall? A. What do you remember? I can't recall the first time I met them to be honest with you. 24 25 When did you have first make contact with probably shortly after that that I...(INTERJECTION). 16 23 Now, that would have The question I had asked you was when you went, you 10 12 What did you do? Usually when I met -- unusual if I met them it was 26 because I had to sign something because the 27 signature of mine was required. 28 29 I 101 Q. Who did you meet? 1 102 Q 2 A 3 103 Q 4 A 5 I can't recall any other name, no. Yes ? In fact I don't know that I met anybody else. I think he was probably the only one. 6 104 Q 7 A 8 105 Q 9 A 10 Just Traynor? Yes . How often would you have met Mr. Traynor? Probably three or four times over whatever it was, the 12 years, something like that. 11 106 Q Yes. Did you meet a Mr. Stakelum? 12 A Yes. Mr. Stakelum? 13 107 Q Yes? 14 A 15 108 Q 16 A Yes, I did. Would you tell me about what role he played? Mr. Stakelum was I think -- I mean in the early days 17 I don't know that he -- I don't think he was 18 involved at all in the early days. 19 109 Q 20 A Yes? Oh, yes, I think perhaps he was. Did he work for 21 the accountants Haughey Boland to begin with? 22 think he may have worked for Haughey Boland and then 23 may be at about that time that they started 24 preparing the accounts for the Irish Company. 25 I think he started business on his own and I think 26 Mr. Lindsay used him as a financial adviser but he 27 didn't work for the Company. 28 110 Q 29 A Did you meet him? I Then 1 Do you recall did you meet him about anything 2 specific about the affairs of the Company? 3 A I don't remember in specifics initially about 4 Company affairs but I remember in the years that we 5 were really quite busy that one of the things that 6 we used to do was take a number of dealers to the 7 factory in Spain. 8 112 Q 9 A Yes? And in addition to the actual dealers there were 10 times when we took people who either worked for us 11 or supplied us in some other way and he certainly 12 came on one of those trips. 13 113 Q 14 Did he advise you at all on your own personal tax affairs? 15 A 16 114 Q 17 18 Yes. No, no. Did you have an adviser for your own personal tax affairs, either in this Country or in England? A Yes. When I first went to England -- I mean I 19 didn't -- yes, when I first went to England since 20 Haughey Boland were the Company's, the parent 21 Company's, auditors accountants they automatically 22 came over and dealt with the UK situation and they 23 also dealt with my personal affairs. 24 115 Q 25 A 26 116 Q 27 A 28 117 Q 29 A Who in Haughey Boland? Who is this? In those early days. Who was that? Mr. Carty. I don't recall any other name. In those early days you say? 1 118 Q Did it continue that Haughey Boland were the 2 accountants for the English Company and your 3 own personal accountant? 4 A 5 I think Haughey Boland continued to be the Company's accountant. 6 119 Q 7 A 8 120 Q 9 A Yes? For so long as the Company existed. Yes. Who were yours? And they continued to be mine for as long as I was 10 with the Company and the Company existed but once 11 that ceased I then moved my personal affairs to 12 Baker Tilly in Birmingham, which was called 13 something else. 14 121 Q 15 A 16 122 Q Yes? Halls I think, yes. I now want to ask you some questions about 17 the decision to cease the operations of 18 Super Ser Limited? 19 A 20 123 Q 21 A Yes . Was the company wound up? When you say "wound up" I don't believe it was 22 wound up in terms of a Company being wound up by 23 a liquidator or a receiver but it didn't go out in 24 a blaze. 25 It, I think, traded to a stop. 26 124 Q 27 A 28 125 Q 29 It didn't go out in a blaze of glory. It ceased trading? Yes . A liquidator was not appointed. trading? It just ceased 1 2 126 Q. 3 A. 4 127 Q 5 A 6 128 Q 7 A 8 129 Q 9 A 10 130 Q When do you think that was? I think 1983. Yes. What happened to its subsidiaries in England? Well, England went first. Did they just cease trading, the Companies? Yes . They were not formally wound up? No. Mr. Goosen. I want vou to look at some documents 11 now. 12 we just hold it a minute. 13 they are slightly out of order. 14 (Exhibit 2) 15 internal letter, from Mr. Traynor. 16 Ansbacher Limited. 17 in Guinness & Mahon Limited. 18 1990. It is tab 7 & 6. Tab 7 first. I think if Just hold it because (Same Handed). Page 38 please This is a letter, an It is headed It is addressed to Mr. Humphries It is dated 30th July It is: 19 20 21 22 23 24 25 "Dear David, Could you please have someone make the necessary arrangements with Guinness Mahon & C o . in London so that Mr. Chris Goosen may call in some time on Thursday, 2nd August, to collect Stg.£20,000.00 in cash. Mr. Goosen has called to Guinness Mahon & Co. on numerous occasions and is probably known to Brenda Bartlett but, as usual, I will ask him to bring his Passport with him for identification purposes. 26 27 28 29 The debit should go to Ansbacher Limited Account No..." 1 "... Perhaps you would have someone confirm to Joan or myself that it will be in order for Mr. Goosen to call to Guinness Mahon on Thursday so that I in turn can confirm the arrangement to him." 2 3 4 5 6 Could you tell me about that Mr. Goosen? 7 A. 8 131 Q. 9 A. 10 132 Q. 11 A. 12 133 Q. 13 A. 14 134 Q. 15 A. 16 Unspecifically can you tell me about it? No, Sir. Do you understand what the letter means? Well, I believe so. What does it mean? Well, I mean I am reading it. What does it mean? Could I ask you -- I mean I am not completely clear as to what this inquiry is about. 17 135 Q. 18 A. 19 136 Q. 20 21 Specifically I can't tell you anything about it. Yes. I will explain to you in a few moments? And...(INTERJECTION). Just answer my questions first Mr. Goosen. Just tell me what you understand that letter means? A. 22 Well, it is Mr. Traynor asking to make a sum of money available to me. 23 137 Q. 24 A. 25 138 Q. 26 A. 27 139 Q. 28 A. 29 140 Q. In cash? But I can't remember what it is for. In cash? Yes. You cannot remember what it is for? No. However, you did receive the sum of money that is 1 2 I can't confirm that Sir, no. 3 141 Q 4 A 5 142 Q 6 A 7 143 Q 8 A 9 144 Q 10 I think it is unlikely that you did? I just can't recall. Yes ? So I can't confirm o r ...(INTERJECTION). Or Deny? Deny really. What do you think? Do you think you did not receive it? 11 A 12 145 Q I don't know, Sir. Just a moment Mr. Goosen. 13 Mr. Goosen. 14 it? 15 A 16 146 Q You are under oath now You do not know whether you received No, I don't. I will put the question somewhat differently to you. 17 Were you in the habit of obtaining money from 18 Guinness & Mahon, either in Guinness & Mahon in 19 Dublin or in London? 20 A 21 147 Q 22 23 No, I wouldn't have said so. What would you say then? Did you ever receive money? A There may have been occasions when I received some 24 money but I wouldn't say I was in the habit of doing 25 it . 26 148 Q 27 A 28 149 Q 29 Alright. There may have been occasions? Yes . How did that come about? 1 150 Q 2 A 3 151 Q 4 5 No. I am asking you how it came about that you received money in Dublin or in London from Guinness & Mahon? A Well, all I can say is for example when I left the 6 Company, or when I sold my shares in the Company, 7 the payments were through Guinness & Mahon and 8 through Mr. Traynor. 9 152 Q 10 11 Are you saying that these are the payments for your shares ? A That could well be a part of it. I would expect it 12 probably is but, you know, you have just given me a 13 piece of paper and I have no...(INTERJECTION). 14 153 Q Yes. I will give you another piece of paper 15 Mr. Goosen. Could you look at a letter of the 16 15th October, page 40 (same handed) 17 This is dated 15th October to Mr. Humphries: (Exhibit 3)? 18 "Dear David, Could you please have someone make the necessary arrangements with Guinness Mahon & C o . in London so that Mr. Chris Goosen may call on Thursday morning next, 18th October, about 11 a.m. and collect Stg.£20,000.00 in cash. 19 20 21 22 Mr. Goosen has called to Guinness Mahon & Co. on several previous occasions and is probably known to some of the staff members." 23 24 25 26 27 Do you recall that? A No, I don't. 28 What would you suggest is the conclusion we should 29 draw from this letter? Do you think we should draw 1 the conclusion that you got £20,000 around about the 2 15th October in London? 3 I can understand why you would draw that conclusion 4 from that. 5 155 Q 6 A 7 156 Q 8 A 9 157 Q 10 A 11 158 Q Yes. Can you give us any reason? And I don't think that is unreasonable by any means. Can you give us any reason? For you to draw that conclusion. Can you give us any reason why we should not? No, I can't Sir, no. Yes. Then, if that is so then, how did it 12 come about that you were drawing money from 13 Guinness Mahon, which was debiting the account of 14 Ansbacher Limited with the funds that you were 15 getting? 16 A 17 18 As I have explained I sold my shares in the Company and I was being paid by Guinness Mahon. 159 Q 19 Is your explanation for this: for your shares? 20 A 21 160 Q These are payments Is that what you are telling us? I would think so more than likely, yes. Why? Why would they be paying you from the 22 Ansbacher Limited account, their own account in 23 Guinness Mahon? 24 shares ? 25 A 26 161 Q 27 A 28 162 Q 29 Why would they be paying you the I don't know what the internal workings are. You do not know. You cannot explain to us? No, Sir. Would you just turn to a letter, which is page 42, (Exhibit 4) of the 12th December 1990 (Same Handed). 1 Here is another arrangement being made for a payment 2 of £20,000 in cash? 3 A. 4 163 Q. 5 Can you tell me what the total of these adds up to? No. I will in a moment Mr. Goosen. I want your explanation first? 6 A. 7 164 Q. 8 A. 9 May I ask you? Yes? Because to begin with you said to me that I wasn't on trial. I mean I am beginning to feel that you 10 are putting me under a bit of pressure. 11 beginning to feel that you are sort of putting me on 12 trial. 13 165 Q. 14 A. 15 166 Q. I am No, Mr. Goosen. I came here to help you as best as I can. No. Mr. Goosen, I will tell you what we are doing 16 here. 17 appears from this that you drew money from Guinness 18 Mahon? 19 A. 20 167 Q. 21 A. 22 168 Q. It is perfectly clear from our letter. It Yes. Given in cash? Yes. From an account in the Company, whose affairs we are 23 investigating, Ansbacher Limited and 24 explanation for it and so far you have not been able 25 to give me any explanation for it. 26 continue. 27 the 12th December (Exhibit 4). 28 sum of £20,000 in cash. 29 were receiving the money in cash? I want your We will I want you to refer now to the letter of This, again, is a Can you explain why you 1 I can only say the same answer as I have said to 2 you for the previous two. 3 169 Q 4 Can you explain why you were taking the money in cash? 5 A 6 170 Q No, Sir. However, was it not a bit strange that here is 7 £60,000 that you took in cash? 8 happening do you think? 9 A Why was that I would like -- I mean if we are going to continue 10 asking me as if I am being tried for something, in 11 that case then I think may be I should have some 12 legal representation. 13 171 Q 14 A No, Mr. Goosen? I mean I have come here to help you as much as I 15 can, out of goodwill, you know. 16 do not understand...(INTERJECTION). 17 172 Q 18 A I quite honestly Perhaps, it will become...(INTERJECTION)? The jurisdiction of myself being a UK resident in 19 answering these questions to you Sir, with the 20 greatest of respect. 21 because I have no legal counsel or advice to base 22 that on. 23 173 Q Alright. Yes. I don't understand that We made clear in our letter to 24 you what our jurisdiction was Mr. Goosen. 25 to continue now with another letter of the 26 17th September 1990. 27 (Exhibit 5). 28 Could you explain that to me please Sir because I 29 don't understand it really? I want It is page 36 (Same Handed) You say you explained 1 2 174 Q 3 Yes. The letter Mr. Goosen, which we sent you, explained fully the Order of the Court? 4 A 5 175 Q Yes . The investigation into the affairs of 6 Ansbacher Limited, which was formally known as 7 Guinness Mahon Cayman Trust Limited? 8 A 9 176 Q 10 A 11 177 Q Yes . And its Irish business? Yes . And its Irish business included business which it 12 conducted here in Ireland. 13 documents that Ansbacher Limited, the Cayman 14 company, had an account with Guinness & Mahon in 15 Ireland? 16 A 17 178 Q It appears from these Yes . Which, I am sure you know by now, was a subsidiary, 18 that Ansbacher was a subsidiary in the Cayman of 19 Guinness & Mahon in Ireland? 20 A 21 179 Q Yes . It appears from this that you availed of the 22 services of Ansbacher Limited in that you were able 23 to, whatever arrangements were made, obtain funds 24 from Guinness & Mahon here in Ireland by contacting 25 Mr. Traynor? 26 A Yes . 27 And that is the matter in which I am enquiring into 28 now? 29 Right. 1 181 Q 2 A But Sir could I just ask you please just to advise 3 me as a UK resident and as a UK taxpayer and as 4 someone who has -- I mean am I not outside the scope 5 of that enquiry. 6 182 Q 7 No, you are not outside the scope of the enquiry. This is not a trial, as I told you? 8 A 9 183 Q 10 A 11 184 Q 12 A 13 185 Q Right. We are reporting to The High Court? Right. The result of our investigations? Yes . I would like you to look at the letter of 14 17th September (Exhibit 5) which 15 i s ...(INTERJECTION)? 16 A 17 186 Q 18 A Sorry, one final question. Yes ? May I ask to take some legal advice on this since -­ 19 I mean since you start talking about The High Court 20 or something then I think I should have some legal 21 advice? 22 187 Q When you say "we start talking about The High 23 Court", was it not clear from our letter that we 24 were Inspectors appointed by the High Court? 25 A 26 I saw that. Yes, I saw that you were Inspectors appointed by The High Court. 27 188 Q 28 A 29 189 Q Yes? Yes, Sir, I saw that. Did you discuss our letter with any legal person in 29 1 England? 2 No. 3 190 Q 4 A 5 191 Q 6 A 7 8 No. So you have...(INTERJECTION)? I have tried, in fact, but I mean presumably -- have you spoken to Mr. Lindsay? 192 Q 9 10 Did you discuss it with Mr. Lindsay? If you would just answer the questions please Mr. Goosen? A Yes. I have tried but I haven't discussed it with 11 him, no. 12 get in contact with him but I think he is out of -­ 13 I don't know where he is. 14 be on all the time. 15 193 Q When I say "I have tried" I have tried to His answer phone seems to Mr. Goosen, we requested you to give us an unsworn 16 statement, which you did not do. 17 attend, which you have done so and you have attended 18 now. 19 answer further questions until you have got legal 20 advice? 21 A We asked you to Do I understand that you are now refusing to No, no, Sir. You are quite right. I didn't 22 understand really that you were asking me to make an 23 unsworn statement. 24 your initial letter was to ask me for copies of any 25 documentation that I had. 26 No, that was not in our letter at all? 27 A I understood that the purpose of I mean what made me aware of this in the first place 28 was that I got a letter from Guinness & Mahon saying 29 that I may be a person whom the inquiry is 1 2 195 Q 3 A 4 196 Q Yes ? Which really surprised me. If we return now to the question I was asking you 5 Mr. Goosen: 6 questions ? 7 A 8 197 Q 9 A 10 198 Q Are you refusing to answer further No, Sir. No? No, no. Very well. Let us continue because I want to make 11 it absolutely clear to you that this is an 12 investigation into the affairs of Ansbacher. 13 endeavouring to find out what services you availed 14 of? 15 A 16 199 Q We are Yes . Because it is quite clear from the documents we have 17 that you did avail of it and that is the purpose of 18 our investigation here today. 19 A If we continue then? But Sir then can I -- does that mean that I can't 20 have legal representation or I can't take legal 21 advice on...(INTERJECTION). 22 200 Q No. It means that if you -- you can decide that you 23 do not wish to go on with this interview today on 24 the basis that you have not got legal advice. 25 can say that to us if you want to say that, in which 26 event we will take it that you are declining now to 27 answer any further questions until you get legal 28 advice. 29 can go on with the investigation today? You You can take that line or alternatively we 1 Okay. 2 cooperative with you so far. 3 continue doing that. 4 201 Q 5 A 6 I would want to Very well? There is no, you know -- I don't want it to be hostile. 7 202 Q 8 A 9 Very well? But I don't want to -- I don't know. I am not a legal mind but if I got some rights I want, you 10 11 I mean I believe I have been fully know -- may be I need to be told about them. 203 Q Yes. I just want to know do you not wish to answer 12 further questions until you have got legal advice 13 and been told about your legal entitlements? 14 A 15 204 Q 16 A 17 205 Q 18 A 19 206 Q 20 Well, shall we go on a bit further? Very well then? You know I want to show willingness but -- yes. Very well. We will go on until you ask us to stop? Yes . This is a letter to Mr. Humphries from Mr. Traynor of the 17th September 1999. It is: (Exhibit 5) 21 22 23 24 "Dear David, I should be grateful if you would arrange to let me have a draft for Stg.£25,000.00 payable to Mr. C. Goosen. The debit should be to Ansbacher Limited Account..." 25 26 And it is numbered. 27 28 29 "...Padraig Collery will call to the Bank at 3.00 p.m. this afternoon and I would appreciate if he could collect the draft at that time"? 1 2 3 207 Q. 4 A. 5 208 Q. 6 A. I believe it is part of the same thing. 7 209 Q. Do you know who Mr. Padraig Collery is? 8 A. 9 210 Q. 10 A. 11 211 Q. No? I can only refer you to my previous answer. Do you know who...(INTERJECTION)? No. Sorry? No, I don't. You do not. 12 that is you. 13 Dublin? 14 A. 15 212 Q. 16 A. 17 213 Q. 18 A. 19 214 Q. 20 A. 21 215 Q. 22 A. 23 216 Q. 24 This was a draft payable to Mr. Goosen, Do you remember receiving a draft in No, Sir. Sorry? No, I don't. Was one ever posted to you? I don't believe so. I don't know. Pardon? I don't know. I don't believe so. You do not...(INTERJECTION)? I don't know. Yes. I just don't know. Have you any recollection of a draft being posted to you? 25 A. 26 217 Q. No. This letter would appear to be indicating that 27 Mr. Collery, who was an employee of the Bank, was 28 going to receive a draft which was payable to you. 29 Can you recall receiving a draft? 1 2 218 Q 3 A 4 219 Q 5 A 6 220 Q 7 No. You do not think it is likely? No, I don't recall anything about that Sir. Yes. You do not think it is likely that you received the draft? 8 A 9 221 Q I just don't recall. Yes. Mr. Goosen, these drafts, that I have been 10 referring to, from July to December amounted to 11 £ 100, 000? 12 A 13 14 Yes. I think the ones that I have got here are £85,000? 222 Q Yes, I see. There is another one then. You can 15 take it that there was £100,000, £85,000 or 16 £ 100, 000? 17 A 18 223 Q 19 Yes . Do you remember getting that sum from Guinness & Mahon in 1990? 20 A 21 224 Q 22 A 23 225 Q 24 That seems to be -- it is possible, yes. The question is: Do you remember it? I don't remember it, no. You do not remember it. However, it is possible that you did? 25 A 26 226 Q Yes . Why would they have been paying you that sum, 27 deducting it from the Ansbacher account in Guinness 28 & Mahon? 29 A Why would they have been paying it to you? What their accounting was I have no idea but why I 1 would be receiving it would be for the sale of my 2 shares. 3 227 Q. 4 A. 5 228 Q. 6 A. 7 229 Q. 8 A. 9 The sale of your shares? Yes. Which took place when? I think that is the time. The Company ceased business in...(INTERJECTION)? No, earlier than that, sorry. That is what it would be . 10 230 Q. 11 A. 12 231 Q. 13 A. Seven years after the Company ceased trading? The Company ceased trading when -- yes. Who did you sell your shares to? To an American company that was involved with 14 Super Ser Dublin, I think at the time when they were 15 trying to get into America. 16 232 Q. 17 A. 18 233 Q. 19 A. 20 234 Q. 21 A. 22 235 Q. 23 A. 24 236 Q. 25 What was the name of the Company? I can't recall. What was the purchase price of the shares? It was, I think, £250,000. For all the Company? No. For all the shares? For my shares. Yes. You were unpaid between 1983 and 1990 for your shares ? 26 A. 27 237 Q. I can't recall. You cannot. Is there a difficulty in the statement 28 I have just made? It is arising from your own 29 evidence that the Company ceased trading in 1983. 1 You say these might have been payments for the 2 shares ? 3 I would need to try to do some more specific sort of 4 research to look back into that to be honest with 5 you. 6 238 Q 7 8 A No, other than the fact that they were connected to Guinness & Mahon Dublin, who short of brokered the 10 deal, brokered the arrangement. 239 Q 12 13 Can you explain why the Cayman Islands company would have been paying you for the shares? 9 11 I see. Yes. Who in Guinness & Mahon Dublin brokered it Mr. Goosen? A 14 Well, Mr. Traynor was the only person that I know of there. 15 240 Q 16 A Did he broker it? Well, when you say "broker" may be I have used a 17 bad word. 18 Guinness & Mahon who was involved in administering 19 the funds, the proceeds of the sale. 20 241 Q 21 A 22 242 Q 23 A Who actually negotiated the sale then? I think Mr. Lindsay. Yes? Mr. Lindsay and Mr. Stakelum -- sorry, Mr. Lindsay and Mr. Traynor. 24 25 243 Q 26 A 27 244 Q Mr. Lindsay and Mr. Traynor? Yes . They must have been in touch with you about it, were they? 28 29 He was certainly the person in A Yes, I mean at the time -- well, I had to agree to 36 1 it. 2 getting absolutely nothing for it. 3 245 Q. 4 A. 5 246 Q. 6 A. 7 247 Q. 8 A. 9 248 Q. 10 It was a question of getting something or Yes? So, yes. They were in touch with you about? Yes, we did meet about that. Did they write to you about it? I don't think so. Yes. Did you come over to Ireland then to discuss it with them? 11 A. 12 249 Q. Yes, I did. Who were the discussions with? Was it Mr. Stakelum and your partner Mr. Lindsay? 13 14 A. 15 250 Q. 16 Yes. Did you discuss it with any of the purchasers of the shares ? 17 A. 18 251 Q. 19 A. 20 252 Q. No, my dealings were done through Mr. Lindsay. Yes? And Mr. Stakelum and Mr. Traynor in total. Yes. The funds that I have indicated to you now do 21 not amount to the total purchase price of the 22 shares. 23 purchase price of the shares was paid? 24 A. 25 253 Q. 26 A. 27 254 Q. 28 A. 29 255 Q. Do you remember how the balance of the No, not specifically, no. Unspecifically do you remember? No, Sir, the same, I don't. You do not remember? I don't. I haven't got those details. You see there are documents here which show that you 1 received sums of £20,150 on a regular basis from 2 February 1991 from Henry Ansbacher & Company Limited 3 in London, the account being Ansbacher Cayman 4 Limited's account in London. 5 and getting cash in the London Bank of Ansbacher? 6 Yes . 7 256 Q 8 A Tell me about that? Do you recall going in What did you do? I know I did go to the London Bank of Ansbacher. 9 mean I think at that time -- was it that time that 10 Ansbacher bought out Guinness & Mahon or something 11 or is that the time? 12 257 Q 13 A Just tell me what you recall? I think, you know, I went there one day and it was 14 Guinness & Mahon. 15 Ansbacher and I really don't know anything to do 16 with the connection between Guinness & Mahon and 17 Ansbacher. 18 258 Q 19 A 20 21 The next time I went there it was Just let us get the facts? Other than I think Ansbacher bought Guinness & Mahon. 259 Q 22 I have documents here, which I can show you in a moment Mr. Goosen...(INTERJECTION)? 23 A 24 260 Q 25 A 26 261 Q I That is all I can say to you. Just let me finish? Yes . Between 1991 and 1996 you went regularly to Henry 27 Ansbacher & Co. Limited and received cash, £20,150 28 each time. 29 receiving cash from them? Do you recall going regularly and 1 2 262 Q 3 A 4 263 Q 5 A 6 264 Q 7 A 8 265 Q 9 A 10 2 66 Q Do you recall regularly going and receiving cash? I recall going there. Yes ? I cannot be specific about...(INTERJECTION). I will just put the documents to you? Yes . It is tab 8 (Same Handed) (Exhibit 6)? Thank you. Do you see these are Henry Ansbacher & Co. Limited 11 statements of account. 12 Ansbacher Cayman Limited. 13 the Cayman Islands. 14 account that you received. 15 quite certain if you have got it in proper order. 16 If you look at the back, page 62 the bottom? 17 A 18 267 Q 19 A 20 268 Q 21 A 23 269 Q That is the Company in It is debiting cash to their Do you see -- I am not Yes . It is February 1991, it begins? So, that is leading on from this, isn't it? If you would just turn each page. through each page. 22 It is the account of We will go £20,000 in cash? Yes . £20,000 in May of 1992, in cash. Then in May of -­ 24 the next page, in October 1993 cash. 25 £15,000 in cash. 26 April 1994, £20,100 cash? 27 A December 1993, February 1994, £20,100 cash. Yes . 28 And so it continues on up to 1996. 29 these drawings now Mr. Goosen? Do you remember 1 2 Its the same thing that we have been talking about. 271 Q 3 4 Just answer the question: Do you remember these drawings ? A 5 I don't remember them specifically, I say again, but...(INTERJECTION). 6 272 Q 7 A But what? But that is drawings that I was entitled to have 8 because, if that is presumably what that is, that is 9 why I sold the shares of the Company. 10 273 Q Are you saying then that these are drawings of the 11 proceeds of the sale of shares in the Company? 12 These are cash for the shares of the Company, is 13 that what you are telling us? 14 A 15 274 Q 16 A 17 275 Q Yes, I get that, yes, yes. They come to over £300,000? Because there is no other -- yes. You told me, with the other document that I have 18 referred to, that there is £100,000 in the others 19 that you drew in Dublin. 20 explain how, if the shares were sold for £250,000, 21 you obtained this amount? 22 A 23 276 Q 24 A 25 277 Q 26 A 27 278 Q 28 A 29 279 Q That is £400,000. Can you I believe they were invested and they accumulated. Why do you believe that? Because that is what they were. Did somebody tell you that? Yes . Who told you that? Mr. Traynor. They were invested. 1 A. 2 arrangement. 3 280 Q. 4 A. 5 What arrangement? That he would invest the proceeds of the sale, my share of the proceeds of sale, of the Company. 6 281 Q. 7 A. 8 9 Well, it was with Mr. Traynor that I made the Yes? And that when I wanted to draw money from it I could draw money from i t . 282 Q. I see. The sale of the shares then, you gave the 10 purchase price. 11 he would invest it? 12 A. 13 283 Q. 14 A. 16 284 Q. 17 Did he tell you where he was doing so, where he was No. Did he tell you that it was in a subsidiary of Guinness & Mahon Ireland? 18 A. 19 285 Q. 20 A. 21 286 Q. 22 A. 23 287 Q. 24 A. 25 288 Q. 26 A. 27 29 Yes. going to put it? 15 28 You arranged with Mr. Traynor that No. Did you know where it was? No. Did he ever then account to you from time to time? I suppose so but -- yes. He did? Yes. In what way did he do that Mr. Goosen? When I met him or he might have sent me something in the post. 289 Q. Right. In England, to England? 1 2 A. 3 291 Q. 4 A. 5 Yes. Where in Ireland? In -- is it George's Street? I was in? 6 292 Q. 7 A. 8 293 Q. 9 A. 10 2 94 Q. 11 The offices of Guinness & Mahon you mean? Yes. You would go into the offices and meet Mr. Traynor? Yes. He would give you an account then of your investments ? 12 A. 13 295 Q. 14 Yes. All that happened after the sale of the shares of the Company in 1983? 15 A. 16 2 96 Q. 17 A. Not often. 18 297 Q. Not often? 19 A. 20 2 98 Q. 21 A. 22 299 Q. 23 A. 24 300 Q. 25 A. 26 301 Q. 27 A. 28 302 Q. 29 Was it George's Street Yes. How often would you have gone into him then? No. He would give you an account when you went in? Yes. Have you kept any of these documents? No. Do you remember what the accounts showed? No. You are probably going to show me in a minute. Do you remember what the accounts showed? No. Did you know that the funds that he had invested 1 2 The whole point, yes. 3 successfully then so that the funds that you got in 4 Dublin and then later through the Bank in London 5 were the proceeds, the increased proceeds, of sale 6 due to the investments that he carried out on your 7 behalf? 8 A 9 304 Q You think he invested them Yes . Mr. Goosen, the terms of reference under which we 10 are acting by The Court Order, a copy of which we 11 sent to you, ask us to investigate whether the 12 Cayman Island company was carrying on its business 13 so as to enable its customers to defraud their 14 Revenue, the Revenue authorities of their Country. 15 16 Our terms of reference mean that if they were 17 carrying on Irish business for people who were 18 resident in England or in America in such a way as 19 to enable them to defraud the Revenue authorities of 20 their Country, that this is a matter which calls for 21 our investigation. 22 23 Accordingly, 24 returned the interest which was earned on the sale 25 of these shares, which were invested you say by 26 Mr. Traynor on your behalf, to your authorities, 27 your Revenue authorities in England? 28 I would say to you at this stage that I would now 29 like to terminate the interview. I have to ask you whether or not you 1 305 Q 2 A 3 And get my accountants and whatever legal assistance I might need. 4 306 Q 5 A 6 307 Q 7 A 8 308 Q Very good? Please? Yes. You do that. We will do that Mr. Goosen. Thank you. What would be helpful would be if you could, having 9 taken legal advice and considered the matter with 10 your accountants, give us a statement then of the 11 position. 12 A 13 309 Q It would help us if you could do that? Yes . If you do not wish to do that what we would require 14 you to do then is to continue this sworn testimony 15 at a later date. 16 statement it may be unnecessary to continue this 17 investigation. 18 ask you if you could return to continue the 19 investigation when you have had an opportunity of 20 considering the position? 21 A If you send us on a written However, if you do not we would Sorry, you said not a sworn statement. 22 statement but not a sworn statement. 23 specifically about what? 24 310 Q 25 26 You say a A statement About as we have indicated in our letter to you in the original letter to you? A A statement to the Investigators. After which it 27 may be necessary to have another meeting or it may 28 not b e . 29 311 Q Yes, depending on whether or not we consider we are 44 1 2 3 4 312 Q 5 A 6 313 Q These documents? A memorandum or whatever of today's interview. A transcript of today's interview will be sent to 7 you. 8 are required by law to sign it? 9 A 10 314 Q 11 We would be glad if you would sign it. You Right. We want to arrange for you to do so. Ms. Cummins will be in touch with you about that? 12 A 13 315 Q Okay. I appreciate that you wish to terminate the 14 interview now and I will do so, of course. 15 I should explain that one of the matters on which I 16 would like your assistance Mr. Goosen is in relation 17 to the Company itself having deposits in the 18 Cayman Islands, whether you knew about that? 19 A 20 316 Q 21 A 22 317 Q However, No. As I say I do not wish to prolong the investigation. Yes, yes. However, it is a matter which I would like your 23 assistance on, whether you knew whether or not the 24 Company itself had deposits in the Cayman Islands? 25 A 26 318 Q No. Mr. Goosen, we will conclude then. We would be glad 27 then if you, having got legal advice and considered 28 matters with your accountants, could give us an 29 unsworn statement. We will consider that and we 1 will be it touch with you then. 2 our responsibilities to the Court require us to ask 3 you to come back we will let you know? 4 A. 5 319 Q. 6 A. 7 Okay. Very good. Thank you Mr. Goosen? Is there any possibility of claiming expenses for coming today? 8 320 Q. 9 A. 10 11 If we do think that Well... (INTERJECTION)? Since I think I have saved you quite a bit in you all coming to England. 321 Q. Yes. The position is we have not any authority 12 Mr. Goosen to order expenses. 13 deals with it and I will ask Ms. Cummins to give you 14 a copy of the relevant section of the Statute? 15 A. 16 322 Q. 17 A. 18 323 Q. 19 A. 20 324 Q. 21 A. However, the Statute Okay. It is not within our power? Okay. To award anything? Thank you. Any expenses? Thank you. 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED AT Vf4J w W 'Ju* S "' W t iT r 1 a & 4 4 i O -o c y t, C L o ^ b -^ 2- lU vfl R. W . £c. „ STA M PS N otary PubHs — ir G l£ * s ( Ansbacher Limited A U tm btr of !ftt B tn y Ansbochtt BoUtngj PLC Mtrchant Menldnt Orxmp Pleaae reply to: 42 FitzwQliaxn Square, Dublin 2 Tel: 765144/763065 Fax: 612035 P-0.Bax *87,Onnd Ctymu, BritUi Wat ladU* PhanK (MS) 949-4633/4 Tdac CP430S A s (109)949-7946 (•09)9*4X7 30th J u l y , 1990. M. D a v id H u m p h rie s, E s q ., S e n io r Manager - o p e r a tio n s , G u in n e ss ft Mahon L im it e d , 17 C o lle g e G re e n , DOBLIN 2. Dear David, C o u ld you p le a s e ha ve someone make th e n e ce ss a ry arra n g e m e n ts w it h G uinness Mahon * Co . i n London so t h a t M r. C h r is Goosen may c a l l i n some tim e on Th u rs d a y , 2nd A u g u s t, t o c o l l e c t S t g .e 2 0 ,0 0 0 .0 0 i n cash* M r. Goosen has c a l le d t o Guinness Mahon i C o . on numerous o c c a s io n s and i s p ro b a b ly known t o Brenda B a r t l e t t b u t , as u s u a l, I w i l l ask him t o b r in g h is P a ssp o rt w it h him f o r i d e n t i f i c a t i o n p u rp o s e s. Th e d e b it s h o u ld go t o Ansbacher L im ite d A cco u n t N o .1 3154602. Perhaps you w ould have someone c o n firm to Jo a n o r m y s e lf t h a t i t w i l l be i n o rd e r f o r M r. Goosen t o c a l l t o G uinn ess Mahon on Th u rs d a y so t h a t I i n t u r n can c o n firm th e arra ngem e n t t o J . D . Tra y n o r JDT/AJW fa . /^ 7 a^ 2e & \d . h . £ khi 6 i t 3 Ansbacher limited nCMtnhmt MmUng Gnu. Pleasewpl! 42 Dublin 2. Tel:7651 Fax; 612035 8S7, Omad Ciymn, Britkh W «t lotfk R mok (MS) 949-4653) Trioc CP43C Fuc (809) 949-79* (809) 949-32t 15th October, 1£90. M. David Humphries, Esq., Senior Manager - Operations, Guinness t Mahon Limited, 17 College Green, DUBLIN 2. Dear David, Could you please have someone ma&e the necessary arrangements with Guinness Mahon « Co. in London so that Mr. Chris Goosen may call on Thursday morning /text, 18th October# about 11 a.m and collect Stg.£20,000 in c Mr. Goosen has called to Gtiinness Mahon ft Co. on several previous occasions and i a r probably known to some of the staff memberb. He will, ey course, bring some identification wi him. Please debit the costf to Ansbacher Limited Account No. 131546C Yours sincerely, J.D. Travnor/. € k h i< i t _ Ansbacher Limited A U m btr of Uu Htnry Antbochcr NoltMngs t i e M tnhtrn Banking Group Please reply to: 42 HtzwQHam Square, Dublin 2. . Tel: 765144/763065 Fuc 612035 P.O. B n W7. O nnd Csyaou, Britkh W o t l a t a P hot* (109) TUhb CP 005 Buc (105) M9-7M6 12th December# 1990. M. D a v id H um phries, E s q ., S e n io r Manager - O p eratio n s# Guinness ft Mahon L im ite d # 17 C o lle g e Green# DUBLIN 2 . D ea r David# C o u ld you p le a s e make th e necessary arrangements w ith Guinness Mahon ft Co . i n London so t h a t M r. C h ris Goosen may c a l l i n th e re on F rid a y 1 4 th December and c o l l e c t Stg.£20#000 in cash. M r. Goosen has c a lle d i n t o Guinness Mahon on numerous o cca sio n s and i s known t o Brenda B a r t l e t t and I am sure to o t h e r s t a f f members. He w i ll# o f co u rse ,b rin g -so m e form o f i d e n t i f i c a t i o n w it h h im . Because o f th e s h o rt n o t ic e , I propose sending a copy o f t h i s t o you by fa x w it h th e o r i g i n a l fo llo w in g in the m orning. ^ "^e rh a p s yo u c o u ld have someone r i n g Joan t o co n firm when arrangem ents have been made so t h a t she may a d vis e M r. Goosen. A b c o s t s h o u ld be d e b ite d t o Ansbacher L im ite d Account N o . 13154602. JD T /A JW A M ember o f the Henry Ansbacher Holding* PLC M erchant Banking Group Please replyto: 42 Fitzwilliam Square,. Dublin 2. Tel: 765144/763065 Fax: 612035 P.O. Box 887, Grand Cayman, British West Indies * Phone: (809) 949-4653/4 Telex: CP 4305 Fax: (809) 949-7946 (809) 949-5267 17th September, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness & Mahon Limited, 17 College Green, DUBLIN 2. Dear David, I should be grateful if you would arrange to let roe have a draft for Stg.£25,000.00 payable to Mr. C. Goosen. The debit should be to Ansbacher Limited Account No.13154602. Padraig Collery yill call to the Bank at 3.00 p.m. this afternoon and I would appreciate if he could collect the draft at that time. ■ To expedite matters I am sending this to you by fax and Padraig will bring the original with him when he calls this afternoon. Yours sincerely, J.D. Traynor ‘ i OAlEt 4N0VW 1111-1*0017-101 AN9MOER (CKMWO LMICD rOMKW GEORGE TO* CMNDCAYHW 'BRITISH VEST XNMES PlMM idrfMI Change 1111190017111 of CAWW ACCOUNTS Address OWdHl / /KS8 (CAY) W1D Hcrny Ansbacher ft Co. Limited CURREMT ACCOIMT STERLING WwyWw«»l>ttw« t C M W t __ . 719 FM£ Mi STATEMENT OF ACCOUNT ' I lMum imiir HP* T a« _______ 1 20,tSD.«j .3 » ANS8ACHER tCAWA*) LIWTTO P 0 BOX M 7 GEOftCE T= a • ■ MTE: IIOECtS 1111-1W M T -W 11111*0017101 PImm • GRAND CAYMAN mMn i BRITISH NEST BOXES U Y M M > tc c n m MlD V. > Qiange of ■ Address e w i lM f . ■»;« » Ansa u p n i,70 Henry A nsbtcher & C o .Iim itc d CURRENIj^ODUNT STERLl^., . *i > n u f e » > j a STATTUrTTT OF ACVT*t*NT I *>• !i : Omj j*W— Pwj MV (0 ANSBACHER CCAWMO LJHITCD f om nr 6MM>CMHMt CEORGETDW U t n » WEST INDIES msa (ago Lit* current Accouir S1ERUN6 1111-190017-101 • • 1111190017101 advteaa Change of Address ovaritaf. CAYMAN ACCOUNTS H enry A nsbacher & C o. Lim ited MEKCHANT BAKKEU wmHiaM Mtotaaww,tiiiw remAH.wo*f»M-aian. w i«*imm m PACE N0i 732 STATEMENT OP ACCOUNT______________________________ 1 »*• ) f 0 BOX \ OEOKOE t (HMD CA W BRITISH H fc lf INDIES ANSB CCAV> LTV Henry AmbccfagrA Co. Uafod CURRENT ACCOUNT S THRUMS 1111-190017-101 STATEMENT OF ACCOUHT 1 — F = i h » -[ I 9AUC9S I € « H ~ m 600SEN ♦ I 0*6. I Om 1111190017101 DATE: J1HAY9S 1 1 1 1 - 1 9 0 0 1 7 -1 0 1 ANSBACHER (CAYHAN) LIMITED P 0 BOX 8S7 GEORGE TOWN GRAND CAYMAN BRITISH NEST INDIES *i 14t* wvn^ t Wii(m CHmiq # CAYHAN ACCOUNTS A d d f t M / ANSB (CAY). LTD CURRENT ACCOUNT STERLING 1 H enry A nsbacher f t C o . U n ite d 1 1 1 1 -1 9 0 0 1 7 -1 0 1 PACE NO: fttnyHw STATEMENT OF ACCOUNT________ V» itw SWAY** --r«w*• C hangi of CAYMANACCOUNT! / AXSS (CAY) LTD K M y A iA id iv A C O b L W M M K N ffW H CtlXXENf ACCOUNT HUi Ml IT E R L M S E 3 F !M 01 0) 20,150,00 *v 179 > msmchek mmWLtt .®.n ' f 0 BOXU7 6E0XBE TO M » ro bateb :atm hi m tmm i &Kf ^ .• . HMD CAVKAR BRITISH VEST <«DIEt . r 'iw 01 — 1,1 (M il . . catkmac» ohn / ’ USB (CAY) LTD ' * CUjmEUT ACCOUNT MERLINS . Hemy An*b«cberACo. Limlttd MKMMTiMMI 1111-190017-101 - - h UM .......... i^ g M CI »0l r ^ T 30CT9V V0CT9V I I ciiil'i CHS) FOR HRCfiOOSEK I I j I 20,150.00j I ~ - 121 i - i ) 111119001^1 DATE: CAYMAN IHTL BANK AND TWJST CO i-TD P 0 BOX M 7 GEORGE TOWN GRAND CAYMAN „ BRITISH NEST IND IES WUSW 1111-19*. ^ t . J^ . Chang# of . Address CAYHAN ACCOUNTS / H em y Ansbacher & C o. Limited !3F. HdnilW CIBTC CAY CURRENT ACCOUNT STEM. INS Ow WlllnmHl i»tw<««ICMWiW twllWM 1111-190017-101 ’ PACE NOt STATEMENT OF ACCOUNT______ »*w> vafc*0«aj SAUG94J 1 401 c a s h f cue e soosen 20/ 100.001 I;:. I u,»r ) ) ' Flam DATE! 2 0 J l » W s T m CAYMAN XN1L BANK AND TRUST CO LTD P 0 BOX S87 6E0R6E TOWN SftANO CAYMAN BRITISH NEST DOZES .4 0 0 1 7 -1 0 1 - . ' o v w ln l CAYHAN ACCOUNTS / Henry Ansbacher & Co. Limited . M nO M X TM N CEU • CURRENT ACCOUNT 1 1 1 1 -n 0 0 1 7 -1 0 1 STERLING Vj w Bm I STATEMENT OF ACOOUOTPAffi HOl Bilin—il' I 56 I f I C JEOOSEN CASH j ^looloo Chang* of Address ' CIBTC CAY •* * •» 5S7 9^*01 I ?11? 4 CAYHAfl IMTL Q* p 0 BOX 8S7 GEORGE TOMi GRAND CAYHAN____ ; BRITKH NEST INDIES 1 ™ • ■ CAYMAN ACCOUNTS Change of Address overtaaf. Henry Ansbacher & Co. Limited CIBTC CAY MSrHANrtANXEtt CURRENT AMOUNT 1111-190017-101 STERLING Man Nom , I MkHSv m ; LoX m KM SAN. Tri«lMMOM0 2ML Tkks I m 4m , PAGE HQt m St a t e m e n t o f a c c o u n t _____________________ DM w w Pn» -I r , *IAPR94r I Rh m DATE* 11APR9V 1 » - « " ,1 7 -1 0 t iST CO LTD “20,100.00 I fi^LMJCSOdSEN i: (■•Ml If -■I l IfMwlVtaMit AA 613 AA I .(II 119QQ17101 13CO50002 DATE: HNO TRUST CO LTD CAYHAN P 0 BOX 6E0R5E TOWN ' GRAND CAYHAM BRITISH VEST INDIES 7F< ^ -1 9 0 0 1 7 -1 0 1 advisaa Change of Address ovaritaf. CAYHAN ACCOUNTS liff it Henry Ansbacher & Co. Limited CtOTC CAV * merchakt ia n x e m CURRENT ACCOUNT n id i Hmk. I MkitS^urt, LeUoa T ^ W » « 0 I^ 2 *» . Tdn Lm4m U4)M 11-190017-T 01 STERLING STATEMENT OF ACCOUNT__________ v m Ow 3 AFEB94 4FEB91 *- . _F/o_M?dmis GOOsai I I I I 20,100.00 I I •58 S B M B RITISHW ESTMMI8 . .^ » - S**0®* O f Addrvtt CAYKAN ACCODRTt CIBTC CAY H e n r y A o i b a c h e r & C o . Limited CURRENT ACCOUNT fttoyH— * Il » i l f » t « t a i m > l i r T » i » w l l « W i 1 * i t ^ W W i STEALTHS p Dm fffl-MOOlMOt STATEMENT OF ACCOUNT jwwO»i» «ysar — EZDEC93 CASH FOR CHRIS fiOOSEM I I I Cod _ I ^ r - J !£C05le0l CAYMAN V WO TRUST CO LTD P 0 BOX GEORGE T l M GRMIO CAYHAN . . . . BRITISH VEST INDIES DATE: ISO 5 4 11-1900 17*10 1 Ptom •Mhi • Change of _ Address ■ V ' „ O M tW ll. CAYKAN ACCOUNTS iu'/» it Henry Ansbacher St ^ . Limited CIBTC CAY WnCMANt M M C ttl M » 7 II— I.11m m CURRENT ACCOUNT 1 (11-190017^101 3TESUNG jv»no«i«[ i ' . IC U 1AH.Til^ tlH » » IK W T H w I M W * * PAGE NO: 510 STATEMENT OP ACCOUNT__________._________________ pttiii ) 190017—101 DATE: l i t . . . Change of Address • •• ,v’ fd & P , BRITISH HEST INDIES i 111 t 7 W $ I V - id ^ n • OVMlMf. CAYMAN ACCOUNTS ■t . .Limited ANSBACHER 6 .C . Henry Ansbacher CURRENT ACCOUNT rrtwyH«M^ inpf TeCP4M taPQMMM D u b lin 2. Td:76514V 763065 R u e 612035 0M)MMK7 14th December, 1990 N. David Humphries, Bag., Senior Manager - Operations, Guinness A Mahon United, 17 College Green, PUBLIS 2. Dear David, Could you please arrange to let me have for collection on Tuesday morning next 18th Deceaber: (1) A Sterling Draft for 8 tg.£2,000.00 payable to Mrs. Griffin. (2) XR£1,000 in cash. The cost of both items should be debited to Ansbacher Limited Account Ho.tsi 54602. ---- ---------------------Yours sincerely. TO: 76314# F u c 612035 M. David Humphries, Bsq., Senior Manager - Operations, Guinness A Mahon X.iaitad, 17 College Green, DOBIiXN 2 . Z)ear David, / Gould you please arrange to let ae have for collection a Draft for I*£2,000.00 payabl* to Mrs. C. Griffin and debit the Sterling cost to Ansbaaner Limited Account No.13154602. Yours sincerely, * JDT/AJW P le a se rep ly to: 4 2 F itzw Q liam Square, D u b lin 2 . T el: 6 7 6 5 1 4 4 /6 7 6 3 0 6 5 PjO. Box SS7, Grand C aynan, Cayman Island*. British W en Indies Telephone « 0 9 ) 9494655 Telex CP 43(15 Facsimile (809) 949-7946 ..................... .... fforaeriyA M bacterLnaiicd) P ax: 6 6 1 2 0 3 5 - 4 t h M ay, 1 9 9 3 . R onan Redm ond, E s q . , C o rp o ra te S e r v io e s , I r i s h In t e r c o n t in e n t a l Bank L im it e d , 9 1 M e r r io n S q u a r e , D U B L IN 2 . D ear Ronan, C o u ld y o u p l e a s e a r r a n g e t h a t r a n s f e r o f E 1 1 0 , 1 2 3 . 6 0 A c c o u n t N o .0 2 /0 1 0 8 7 /8 1 to ' fro m o u r G u in n e s s M ahon G u e r n s e v L i m i t e d P .O . Box 18 8 La V ie lle Cour S t . P e te r P o rt G u e rn se y fo r c r e d it to : A c c o u n t M rs. C . G r i f f i n A c c o u n t N o .36 0 0 0 1 Y o u rs s in c e r e ly , IN T E R N A T IO N A L BANK AND T R P S T C O . L T D . FOX CAYMAN CAY MHMTin.JK-. - ^ * • • A I C H E o rs o •— — ... > . • *• • V / .. Guernsey - Monaco • Zurich - Nassau - Cayman - B VI Please reply to: 42 RtewUIiam Square, Dublin 2. P.°.Box 7.Gnnd Fwitaile (>09)949-794* Tel: 6 7 6 5 1 4 4 /6 7 6 306? Fax: 6612035 . (F orax^ Ansbachcr Umhod) , . / - . V ■~~X ■ 4th May, 1993. Ronan Radaond, Esq., ■ Corporate Services, Irish Intercontinental Bank Limited, 91 Karrion Square, DUBLIN 2. Dear Ronan* Coaid you pleaaa arrange to transfer £50.000 from our Aeeount Nfo.02/01087/81 to Barclays Bank Sarvicaa (Gib.) Ltd . , P.O. Box 187, Regal Bouse, 3 Queans Way, Gibraltar. . For credit tot Account Mrs. Claire and Mr. Barry Griffin Account No.6709. Y o u rs s in c e r e ly . Guernsey - Monaco - Zurich - Nassau - Cayman - BV1 . (49W) 3 Pleasereply lo: 42 Rtzwillism Square, Dublin 2. P.O. Bo* 8*7, Grand Cayman, Cayman Jklandt, British Wen India Telephone (809)9494653 Telex CP 430$ Paarinile (809)949-7944 (FogneriyAmbecherLimited) Tel: 6 7 6 5 1 4 4 /6 7 6 3065 ‘ Fax: 6 6 1 2 0 3 5 - 4th May, 1993. Ronan Redmond, Bsq . , Corporate Service*, Irish Intercontinental Bank Limited, 91 Nerrlon Square, DUBLIN 2 . Dear Kona?, Please arrange the transfer of £50,000.00 fr«™ our Account Ho,02/01087/81 to Banco Nat West Centro Commercial Plaza Nueva Andalucia 29600 Marbella ■ Malaga ' Spain for credit to: • Account Mrs. Claire and Nr. Barry Griffin Account HO. 0013/0240-57-0100089983 Yours sincerely, For CAYMAK IWTBM1ATIOMAL BAKK AMD TR08T CO. LTD. • •s«r- DPC/AJW fsi3MTL;flE j jcHECKgO Guernsey - Monaco - Zurich - Nusau - Cayman - BVI V*- . ..,■*> ; •• A? A ppendix X V (50) M r Jam es G riffin Jnr 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James Griffin Jnr. a) Guinness and Mahon credit committee application of 8 August 1990. b) Guinness and Mahon credit committee application of 21 August 1989. c) Guinness and Mahon credit committee memorandum of 7 July 1987. d) Letter of 13 April 1989 - Ansbacher Limited to Guinness and Mahon. * n C R E D IT COMMITTEE A P P L IC A T IO N U n i t ■ *3.5 M . D u b l i n M in u t e No j D a te s H B W /R E N E W A L /IK g R lA 8 g /R B D U C T I0 N /X M g W > H g irf: BORROWER: J a m e s G r i f f i n AMOUNT: U S $ 6 2 ,0 0 0 ■ C r e d it C la s s S a t is f a c t o r y (Jn r) ( R e d u c t i o n fro m U S $ 7 5 ,0 0 0 ) PROPOSAL & P U R PO SE O F F A C I L I T Y ( S ) : Lo an o r i g i n a l l y ap p ro v e d i n J u ly 19 8 7 a t t h e r e q u e s t o f A n a b a c h e r. a c a p i t a l r e d u c t i o n f o r t h e y e a r en d e d 1 9 8 9 o f U S $ 1 3 ,0 0 0 h a s b e e n r e c e i v e d an d we a r e a s k e d t o e x t e n d t h e r e d u c e d f a c i l i t y f o r a f u r t h e r t w e lv e m o n th s. , ^ S o u r c e o f R e p a y m e n t , R e p a y m e n t Program m e 6 F i n a l M a t u r i t y : S u b je c t t o a n n u a l r e v ie w . p - n k ’ a In c o m e ( i n c l u d i n g R e t u r n on d a p i t a l ) r h - - g i n 1 % (N o u s e o f c a p i t a l ) ' ' “ S ' - - r a r i t y a n d S e c u r i t y t a a r g iA : —— — — .. 1 ' 2 n d M o r tg a g e o v e r f r e e h o l d p r o p e r t y a t 9 7 5 1 SW 9 9 t h S t r e e t , M ia m i, F x o r id a . I 2 . D e p o s i t o f U S $ 6 2 ,0 0 0 fro m A n a b a c h e r . * t 3 . S e c u r it y i s a d e q u a te . ' O th e r C o n d it io n s P r e c e d e n t; ' O th e r In f o r m a t io n : I S i l K ' S R IS K I k M S U R E - A g g r e g a t e ( i n c l u s i v e o c t h i s p r o p o s a l) t o : C u sto m e r R e la t e d C u sto m e r C o m m it t e d /L im it : U S $ 6 2 ,0 0 0 B a la n c e : U S $ 6 2 ,0 0 0 g & j K E r v " R i s k 7 -------------------. jn a r y R i s k : L i m i t : Com m t: • D ra w n : S e c to r R is k : GM se cto r: L im it : C B o fI Com m t: R is k D ra w n : In tr o d u c e d b y : A nsbacher T o ta l £ 3 8 ,0 5 0 £ 3 8 ,0 5 0 C o u n t r y o f P r im a r y R is k : U S A s e c o n d a r y R is k :U S A ______ D o m ic ile :U S A B u s in e s s S e c t o r :P e r s o n a l B u s in e s s S e c t o r :1 0 .0 A s s e t W a lq h t ln q n O f f a e t Recommended b y : C . A . W a it e D e c is io n : Cr Lt C o m m itt e e C h a ir m a n M in u t e N o : M in u t e N o : D u b lin B o ard /C C D a te : GM&Co. D a te : . Apmz. xvmj?laub) C B K P IT COMMXTTM A P P L IC A T IO N M in u t e Hos f T f f U n i t : C i.a H . D u b l i n D a te : Xt . t > C r e d it C la s a : S a t is fa c to r y BORRO W ER/OBLIGO R: J a m e s G r i f f i n AMOUNT: U S $ 7 5 ,0 0 0 PROPOSAL 6 PURPO SE 0 7 F A C I L I T Y ( S ) : L o w o r i g i n a l l y a p p r o v e d i n J u l y 1 9 8 7 a t t h e r e q u e s t o f A n s b a c h e r . We h a v e been re q u e s te d t o e x te n d lo a n f o r f u r t h e r y e a r . S e c u r it y c o n s is t s o f 2 n d M o rtg a g e o v e r p r o p e r t y i n M ia m i. We a l s o h o ld a D e p o s it from A n s b a c h e r . Recom m end we a g r e e t o e x te n d f o r f u r t h e r y e p r . S o u r c e a t R e p a y m e n t, R e p a y m e n t Program m e 6 F i n a l M a t u r i t y : S u b je c t t o a n n u a l r e v ie w . ^ . U c * a In c o m e M a r g in 1 % " . , 2) 3) ( in c lu d in g R e tu r n on C a p i t a l ) : ............. - n i r i t y a n d S e c u r i t y M a r g in : ' ’ . 2 n d M o rtg a g e o v e r f r e e h o l d p r o p e r t y a t 9 7 S 1 SW 9 9 t h S t r e e t , M ia m i. D e p o s it o f U S $ 7 5 ,0 0 0 fro m A n s b a c h e r . f s e c u r it y i s a d e q u a te . r o t h e r C o n d it io n s P r e c e d e n t : O th e r in f o r m a t io n : g A M f f T T O K -fixPd&O&r- A g g r e g a t e ( i n c l u s i v e o f U h ls p r o p o s a l) C u s to m e r R e la t e d C u sto m e r C o m m i t t e d / L i m it : U S $ 7 5 ,0 0 0 B a l a n c e : ____________________ U S 3 7 5 .0 0 0 c o u n try R is k : J w im a r y f t i s k : L i m i t : Com int: D ra w n : - -c t o r : L im it : C o m n t: D ra w n : in t r o d u c e d b y : A n s b a c~h e r t o : :----------T o ta l U S $ 7 5 , 00 0 _______________ - _____________________ U S I 7 5 .0 0 0 ■ C o u n t r y o f P r im a r y R is k :U S A S e c o n d a r y R is k :U S A D o m ic ile : ___________________ GM B u s in e s s S e c t o r :P e r s o n a l C B o f I B u s in e s s S e c t o r : 1 0 . 0 R i s k A s s e t W e ig h t in g :O f f s e t Recommended b y : J . R y a l l D e c is io n : C r e d i t cJxt fan M in u t e N o : D u b l i n B o a rd /CC D a te : M in u te N o : GMSCo. D ate : v crvdit Memorandum n o r ' M r. J a m e s G riffin ' jr v . 8 * Submlttad by: ADDRESS: 9751 S .V /, 99th S tr e e t, M iam i, F lorid a. THIS APPLICATION: » M m x N /A Parmitiion Obtained Daia: N«w PacililY M (0 9 k u M "Exiilint facililfcaovarlMf JppropriHlI ............................... TYPE: W A. Equity S liki: C.B. Approval: BUSINESS/ OCCUPATION: C u sto m er introduced by GM CT AMOUNT: .!.7§«S9Q------ RATE: JJ3fc..Ef*e Ek :The total value of TravellersTcheques required is Stg^ j4.6on <-and she would like to have half in Sterling cheques aqd hal f-in U.S. Dollar cheques. && would be grateful if you could have someone organise this fand advise me of the total Sterling cpst which should be ^debited to Ansbacher Limited Account No.13154602. £Tours sincerely. F IL E U N D E R : Ansb&cher^Limite I ■- - .-— P lease reply to: 42 Fitrw iU iam Square, D u b lin 2. Tel: 765144/763065 Fax: 612035 _______________________ P.O. Box 887, Grand Cayman, ayman Islands, British West Indies • Telephone: (WW) 9 4 9 -tttt te'ieirCP 4305 Facsiinile (809) 949-7946 (809) 949-5267 16th November, 1992. M. David Humphries, Esq., Senior Manager - Operations , Guinness & Mahon Limited, '■17 College Green, DUBLIN 2. ' ¥ 4 I j i ' * ]Dear David, iCould you please arrange to let me have for collection some iU.S. Dollar Travellers Cheques for Mrs. Jennifer Guinness to (the value of US$8,400.00. The cost should be debited to j Ansbacher Limited re Foinciana Fund Limited No.2 Account I No.06428030. ; Mrs. Guinness' address is: . $ ?OQO f Jfoc /« /L /0 ° ilo 'S Censure House, Censure Hoad, Baily, Co. Dublin. I would appreciate it if I could have these collected from you on Monday morning 23rd November. I will then have Mrs. Guinness sign and return the relevant parts to you withd&t delay. Kind regards, Yours sincerely, J.D. Traynor. . A M tm btr tha S tm f A M bm ktr N aU btft PLC M trekm t M nking Group f.a Box 117, Grind C«ym*a, Britbh W « (txn« Please reply to: Rmm: f o r c r e d it t o th e A cco u n t o f % M r s . J e n n i f e r O ix in n e s s A c c o u n t N o .0 0 y * 0 6 0 2 3 . P l e a s e d e b i t t h e c o s t t o A r u b a c h e r L i m i t e d A c c o u n t N o. Y o u rs s in c e r e ly , x • A Fofr ANSBACHER L IM IT E D Jk AHSBJ Ti /A JW Aususucr pnwuTxauLm m atavr cr.fc day of A.D. 1972 BF.TWEEN John Henry Guinness of Censure House, Censure Rpad, •The nailey, Howth, Ireland (hereinafter called "the Settlor") of the one part and GUINNESS MAHON CAYMAN TRUST LIMITED a company incorporated under the laws of the Cayman Islands and carrying on business therein (hereinafter called "the Trustees" which term shall also include any additional or successor trustee or trustees hereof) of the other • part WHEREAS the Settlor has caused the property described in the First Schedule hereto (which together .with the money investments and property for the time being representing the same and any additions or diminishmonts thereto and any further property becoming subject to the trusts hereof is hereinafter called "the Trust Fund) to be duly transferred •into the name or under the control of the Trustees with the intent that the same shall be held upon the trusts hereinafter expressed - . J NOW THIS SETTLEMENT WITNESSETH as follows 1. The Trustees shall stand possessed of the Trust Fund during the period commencing on the date of execution of. these presents and terminating on the expiration of twenty (20) years after the death of the last survivor of the lineal d6scendents now living of His Late Majesty King George the Fifth or on the expiration of seventy years from the date hereof (whichever shall be the earlier) (said period boing hereinafter called "the Accumulation Period" and said • termination date being hereinafter called "the Fixed Date") UPON TRUST as to investments or property other than money either to permit all or any of the same to remain as invested for as long ‘ as the Trustees shall in their absolute discretion deem fit or to sell call * in or convert into money all or any of such investments or property UPON TRUST as to money including the money arising from any such sale calling in or conversion as aforesaid to invest the same in or upon(>. _ _ any of the investments hereinafter authorised ... • <• -- 2. THE Trustees may apply or invest the Trust Fund in the purchase of or at interest upon the security of such stocks funds shares securities options or other investments or property whether real or personal movable or immovable of whatever nature and whereever situate (including any fractional or undivided interest therein and including the purchase maintenance or improvement of a'.freehold or leasehold . dwellinghouse situate anywhere in the world for use as a residence) and whether involving liability or not and whether producing income or c , . not or upon such personal credit with.or without security as the Trustees in their absolute discretion shall think fit with power from time to time to vary such investments for others of a like nature (yet being under no duty to diversify investments) and wiith power to hold cash funds uninvested and other non-income producing property to the , extent that the Trustees shall have the same full and unrestricted powers of Investing the Trust Fund in all respects,as if they were absolute owners boneficially entitled PROVIDED however that in the * professed execution of the trusts and powers hereof the Trustees shall not be liable for any loss to the Trust Fund arising by reason of any investments made in good faith or by reason of any mistake or omission made in good faith by the Trustees or by reason of any other matter or thing except wilful and individual fraud or wilful and individual . wrong-doing on the part of the Trustees who are sought to be made liable without limiting the generality of the foregoing the Trustees are hereby specifically empowered to make investments and to acquire property without any requirement of diversification even though such investments or property may be highly speculative or not of a type which are ordinarily legal or suitable tjrugt investments or holdings in particular the Trustees may margin or hypothecate trust assets or securities in whole or in part sell short purchase or sell options puts calls or other contracts or securities or commodities and carry on * trading activities of every type whatsoever V * 3. _ _THE Trustees shall have the power to sell lease or exchange and to grant options to purchase lease or exchange any property movable or immovable (which expression shall be deemed always to include any part or share of any such property which may at any time constitute the whole or any part of the Trust Fund either at public auction or private sale for such consideration and on such terms credit or security as the Trustees may deem advisable and whether for the purpose of re-investment distribution or diversion and no purchaser on .any sale .. v „ _ _ by the Trustees or other person dealing with the Trustees shall be concerned to inquire into the propriety or validity of any act of the Trustees or to see to the application of any money paid or property transferred to or upon the order of the Trustees. 4. DURING the Accumulation Period the Trustees shall stand possessed of the Trust Fund and the incone thereof upon the following trusts that is to say:' (a) Upon trust for all or any to the exclusion of the others or other of the persons described in the Second Schedule hereto (hereinafter called "the Beneficiaries") in such shares and in.such Manner and subject to such limitations and provisions as the Trustees in their absolute and uncontrolled discretion at arty time or times before the Fixed Date by any deed or deeds revocable or irrevocable without transgressing the rule against porpetuities may appoint and so that by any such appointment the Trustees may confer upon any appointee any valid pover or powers of appointment in favour of any* other Beneficiary AND it is expressly provided (without prejudice to the generality of the foregoing) that the Trustees may appoint on discretionary trusts and that such trusts may include as objects of the powers as regards income of the Trust Fund u n f Beneficiary and ~ may dispose of the whole or any part of the Trust Fund to the Trustees , ( f t any other Settlement (in existence at the time .j>f such disposition t and whether in accordance with the laws of the dayman Islands or not) under which any Beneficiary is a beneficiary to be held as an accretion to the Trust Fund thereof and subject to any such appointment and so far as the same may not extend (b) Upon Trust to accumulate -any income of the Trust Fund in the way of compound Interest by investing the same and the resulting income therefrom in' any of the investments hereinbefore authorised and adding such .accumulations and resulting income as accretions to and as a part of. the Trust Fund (c) Provided always that the Trustees in their absolute discretion may pay or apply at any time and from time to time during the Accumulation Period all or any part of the income or capital of ’ the Trust Fund to or for the benefit of the Beneficiaries and if more than one for any one or more to the exclusion of the other or others of them and in such shares as the Trustees may in their absolute discretion think fit (d) Upon the termination of the Truat on the Fixed Date Upon Tm»t nn to tho balnnon of th" Trust Fund to or for tho Dnnefit of the children of John Henry Guinness as shall be living immediately before tho Fixed Dnto if more than one in equal sharos per stirpes and subject as aforesaid the Trustees shall hold the capital' and • . income of the Trust Fund in Trust for tho National Trust of Ireland and tho roceipts of the Treasurer for the time being of such Charity shall be a good discharge to the Trustees • (e) ' i . ' . Any payment or application of the Trust Fund to o’ r for . the benefit of any one or more of the parties hereinbefore enumerated . jtoay be made either outright or in trust for the said party or parties ■ which trust or trusts may be formed by the Trustees with such provisions and upon such terms and conditions including trusts and powers exercisable at the discretion of any person or persons as the Trustees may in their absolute discretion think fit . * 5.____ IN_addit ion to all the powers vested in the Trustees'expressly or by implication hereunder or by law or statute the Trustees shall have all tho following powers and may in their absolute discretion’ exercise all or any of the same from time to time in such manner and to such extent if at all as may seem to them desirable * * • • (a) To receive additional property or donations by gift or will or by the provisions of any other trust or trusts or otherwise from any person or persons as additions to this Trust and as part of the Trust Fund and to hold the same upon the Trusts herein set for.th and . to administer such additions under the provisions hereof (b) Vith respect to any property constituting the whole or part of tho Trust Fund to exercise all p'owers which individual oeneficial dwners might exercise without ueing restricted in any way uy the office of trustee including (without prejudice to the generality of the foregoing) the following powers (i) To promote and incorporate companies to carry on any business whatsoever and power to liquidate the same and distribute their assets in specie or otherwise (ii) To vote upon or in respect of any shares securities bonds notes or other evidence or interest in or obligations of nny corporation trust association or concern^whether or not affecting tho socurity or the apparent security of. any' -■ --part of tho Trust Fund or the purchase or sale or lease of the " (iii) To give proxies or powers of attorney with or without power of MUhMtltution foe Vatina or aatlno on Bahai* of tho Trustoes as the owners of any suoh property and , (iv) a To participate in and consont to any corporate reorganisation consolidation merger liquidation * .« dissolution sale or lease or in and'to*any other change in any corporation or in its financial structure affecting any securities or other proporty hold hereunder and v , (v) To become a party to any voting trust.or deposit any ■ sncurities or proporty held hereunder with any protective reorganisation or similar committee or in any voting trust or with any depositary designated thereby and (vi) To exercise or concur in exercising the voting and , othar rights attaching to any securities for the time being forming part of the Trust Fund so as to become a Director or other officer or employee of any company and to be * intitind to vote for and to bo paid and to retain for the Trustees* use and oenefit reasonable remuneration for- IV'“ . tho Trustoea* services (vil) To hold or deposit any securities or other property • in bearer form or in the name of the Trustees or In the . name of any one of them being a Trust Corporation or • . • t in tho name of some other persons or partnership or in the name of a duly appointed nominee without disclosing the fiduciary relationship and • (viii) To omit to register uonds or securities and (ix) To keep the whole or any past^of the documents relating to and the money investments and property comprised in the said Trust Fund withih or without the said Cayman . Islands ■ ' (c) To invest re-invest and manage the Trust Fund either separately or togother with other funds to acquire and retain tho shares or securities of Investment companies or investment trusts whether of the open or closed type and without notice to anyone to participate in any common trust fund maintained oy any corporate trustee at any time serving hereunder (d) To or • U cno&QQ the sorviQos of an investment advisor * advisors at tho expense of tho Trust Fund and without liability to follow tho rocommcndations of such advisor or advisors even '(liough auch recommendations may De highly speculative or not of a t y p e wVt 4 « . • « « « » 1 #) K « 1 m m h 1 a m —. « * 1 • « 4 i. ’ Hr *••»»« - ..J. . (e) y To oorrow or lend nonoy on such terms'and from £ ' to such persona including the Beneficiaries as the Trustees nay ' or determine to oe reasonable and proper and without Uniting the generality of the foregoing to margin or hypothoeate all or any protion_of the Trust Fund* < (f) To make execute and deliver deeds conveyances •( assignments transgers options leases mortgages instruments of pledge instruments creating liens contracts and other instruments sealed P ■ or unsealed to raso or erect any building or ot^ier structures and to nake any kind of improvements which the Trustees'* deem proper (g) Vithout prejudice to the jurisdiction of the Court and according to-the respective rights and interests of the persons interested to treat as income or capital or to appontion between • income and capital any dividends stock dividends rights interest rent issues and profits derived from any property at any time comprised in the Trust Fund and generally to determine what part of the receipts of the Trust ia; income and what is capital and whether or not such property ia wasting or unproductive or was purchased at a premium or disconnt and notwithstanding the timo when such dividends stock dividends rights interest rents issues or profits were earned accrued declared or paid to make such reserves out of income or capital as * the Trustees deem proper for exponsos taxes and other liabilities of the Trust to pay from income or from capital or to apportion between income and capital any expenses of making«o& changing investments and i . of selling exchanging or leasing includinff’tM-okers' commissions and charges and generally to determine what part of the expenses of the Trust shall be charged to capital and what part to income and to . » . ' ■ dotermlne as oetween separate funds and separate parts or shares the allocation of income*gains profits losses and distributions (h) To carry on participate or invest in any corporation partnership joint venture or co-operative and to enter into such leases contracts or other undertakings relating to the Trust Fund or any part of it as the Trustees shall in their uncontrolled " discretion deem advantageous notwithstanding fliat such leases contracts or undertakings extend or may extend beyond the termination of this Trust , . * (i) To institute prosecute nnd defend any suits or actions or other proceedings affecting the Trustees or the Trust' Fund or any part thereof to compromise any matters of difference or compound nny deblw owing lo Ihem n» Tninlcws or any oilier claims and to Adjust any disputes in relation to debts or claims against them as Trusteos upon evidence that to the Trustees shall seem sufficient and in whole or in part at public auction or private sale or otherwise and upon such terms and for such terms as the Trustees deem advisable to make partition with the co-owners or joint owners besides the Trust having any interest in any properties in which the Trustees are interested and to make such partition either by sale or by set-off or by agreement or otherwise (including whore deemed desirable provision for equality of exchange) . (j) To take the opinion or advice of counsel concerning any difference arising under this Settlement or any matter in any way relating to the Trust Fund or to the Trustees' duties in connection with the Trust Fund and in all such matters to act in accordance with the opinion of such counsel (k) To employ and pay at the expense of the Trust Fund any agent in any part of the world whother an attorney solicitor banker accountant stockbroker or other agent and whether or not being one of the Trustees hereunder to transact any business or do any act' 1 required to be transacted or done in the execution of the trusts hereof including the receipt or payment of money and the execution of documents and no firm association or corporation any of whose securities a e included within the Trust«£und and no purchaser or other person dealing with.any agent purporting to act under delegation of authority from the Trustees shall be required to ascertain or inquire whether a case exists in which such delegation is permitted or whether such delegated authority is still subsisting PROVIDED however that the Trustees shall not be responsible for the default negligence or fraud of any agent, so employed or for any loss occasioned thereby although . the employment of such agent was not strictly necessary or expedient (l) Upon ahd for the purpose of any distribution or appropriation of the Trust Fund or any part therof in their unfettered discretion to place such value on any and all assets from time to time forming part of the Trust Fund as to .them in their . absolute and uncontrolled discretion shall seem just and proper and any such valuation mado in good faith shall bo absolutely final and bindlrpand conolunlv* on nil TtnnnfJciariaa hereunder and further upon any such discretion or appropriation to determine to whom specified assets shall be given and to distribute the same .subject to the payment of such amounts as may be necessary to adjust' the shares of the various Onneficiarias and further that any * distributions of the Trust Fund may be either made directly to any Beneficiary or applied for his benofit by the Trustees or during his minority mado to his duly appointed guardian or*’to’any person with whom he lives or resides for the use of said Beneficiary without responsibility for its expenditure . WITHOUT prejudice to the generality of Clause 5 hereof if the Trust Fund shall include any shares or other interests in a company th<» ownership of which gives to thom tho right in. any circumstances to control the affairs of the Company or of any of its subsidiariesthe Trustees shall be under no liability or duty to appoint any representative to the Board of the said Company or of any of its subsidiaries and further shall have no responsibility to enquire into oversee or take part in the management or affairs or business of the Company or any of its subsidiaries 7 _ . IN addition to reinbursement of their proper expenses«the Trustees shall be entitled to remuneration (free of any probate succession estate or other death duties wheresoever payable and as a first charge on the Trust Fund) for their services as Trustees in accordance with their published scale of*"f%ea in force from time to time PROVIDED however that tho Trusteos may transact on behalf of or with the Trust or any Beneficiary hereunder any business which by their constitution they are authorised to undertake upon the same terms as would for the time being be made with an ordinary customer and without accounting for m y profit thereby made and in particular and without prejudice to the generality of the foregoing the Trustees may retain on current account or deposit account or advance at interest all moneys necessary or convenient to be retained or advanced in connection with the Trust and may retain for themselves any commission or remuneration paid or allowed by stockbrokers insurance companies or other agents without being liable to an account for any profit thereby made PROVIDED further that the Trustees may transact business on behalf of thrs Trust or any beneficiary hereunder with any corporation or portnnrship in which the Trustees are office holders or shareholders or partners or are otherwise financially interested or with any person or firm holding shares or being otherwise financially interested in the Trustees without being liable to account for any profit accruing to the Trustees as such office holders shareholders or partners as a result of such business and the Trustees may hold offic-e in any corporation shares or securitins in which comprise or form part of the Trust Fund and shall not be liable to account to the Trust for emoluments received by them as such office holders. *• §.____ Trustees hereof (whether original or substituted) nay at any time or time bo removed from thoir office of Trustees by n Dend executed oy the Settlor (hereinafter called "the Appointor") and delivered to the Trustees and tho Appointor nay by deed executed and delivnred as aforesaid appoint any othor person or persons whether or not resident in the Cayman Islands to be Trustees either Jointly with any other than continuing Trustees or solely if after removal there shall . not bn any continuing Trustees and thereupon the Trust Pund shall be ' by an assurance as may be necessary or expedient vested jointly in the persons who shall thereupon become the Trustees of the Trusts hereby created PROVIDED however, that ten outgoing trustee who is liable as a . trustee hereof or may on the 4^ath of any person become liable as a former trustee thereof for any income probate estate or other duties fees or taxes shall not be bound to transfer tho Trust Fund as aforesaid -unless reasonable security is provided for indemnifying such outgoing trustee against such liability P52YiD!5D ALSO that no removal of trustees by the Appointor shall be effective unless after- such removal (either with or without a new appointment) there shall remain at least one trustee being a trust corporation or two trustees Deing individuals (b) Without prejudice to the powers contained in sub-clause (a) of the Clause if a Trustee hereof whether original or substituted shall die or being a corporation be dissolved or shall desire to be discharged from all or any of the trusts or powers hereof or shall refuse or become unfit to act therein or become incapable of acting therein then the following persons namoly:(i) The Settlor or if he shall be dead or unable or unwilling to act (ii) Tho surviving or continuing Trustees hereof for the ‘ time being or if there be no surviving or "continuing' Trusfees" “ (iii) The p erso n a l represontative a of the Inst surviving last Trustee was a corporation then such last* trustee upon rotiromont may by dood appoint ono or moro othor persons or corporation (whotlii'r or not being or including ' the persons oxercising the power) to oe a Trustee or Trustees in the ,place of the Trustee so deceased dissolved• desiring to be discharged refusing or.being unfit or being incapaule as aforesaid. (c) I , , The powers in sub-clause (a) OP THIS Clause contained may at any time oe irrevocably released by a deed executed by the Appointor and delivered to the Trustees nnd the Appointor may in like manner revocably or irrevocaoly grant the said powers to any person or persons to take effect immediately .or after the death of the . Appointor as. the case may be . (d) The Trustees hereof or any of them (whether original or suostitutod) may if they so desire resign an Trustees Hereunder after 3 0 days written notice of their intention so to do sent oy registered prepaid post to the Appointor or such person as the Appointor may from time to time appoint in writing such resignation shall oecome effective upon the day specified in such notice of. resignation ■ • . I (e) In the event of the resignation of the Trustees hereof or in coin there shall be no trustee hereunder Guinness Mahon Bahamas Trust Company Limited or its successors shall become substituted Trustees hereunder (f) Upon the resignation or removal of the Trustees as hereinbefore provided the Trustees shall be entitled to receive reimbursement out of the Trust Fund for all expenses incurred by them in connection with the Settlement of the account of the Trustees (g) On every change in the trusteeship a memorandum shall be endorsed on or permanently affixed to this Settlement stating the names of the Trustees for the time Deing and shall oe signed uy the persons so named and authenticated by a notary or notaries puolic and any person dealing with the Trust shall oe entitled to rely upon any * such memorandum (or the latest of such memoranda if more than one) as sufficient evidence that the persons named therein are the fully constituted Trustees for the time Deing of this '.Settlement ■...... ___ _IbJ At,y substituted Trustees of this Settlement shall hnve all the powers conferred upon the Trustees by law and these presents and any and all Bank* oroltor* itominooa or other depositories custodians of the Trust Fund shall be authorised to accept instructions from the said substituted Trustees as to the . dispositions thereof _ . 9. TUB Trustees shall provide for the safekeeping of all documents of title and securities the subject of thiB Settlement and may at the exponse of the Trust Fund (which exponse may includo any charges for the safe custody of securities and tho collection and remittance of income) deposit the same in the custody of any Dank banking company corporate trustee or stockbroker in any part of tho world that under­ takes the safe custody of securities as part of its business but so ■ that ilia Trustees shall hot bo In any wise responsible for the mis» application of the same or any of them by such bank banking company corporate trustee or stockbroker or for any loss which may be ‘ occasioned thereby 10. IN tho event of any income prouato estate or other duties fees or taxes becoming payaole in the Cayman Islands or elsewhere in respect of the Trust Fund or any part thereof on the death of the ' * Settlor or of any Beneficiary or otherwise theTrustees may at their discretion pay all or any part of such duties fees and taxes out of the Trust Fund without recourso against any Beneficiary or refuse to pay the same or any part thereof unless indemnified and to determine the time and manner of such payment if any «. , • 11^___N0 bond shall be required of the Trustees herein named (whether original or substituted) or if a bond should be required by law to the extent that a waiver by the Settlor is effective no surety shall be required on such a oond 12.___ Z U I S Trust shall bo irrevocable and the Settlor expressly waives all right and power whether alone or in conjunction with any other person to alter amend or revoke this Settlement in whole or in part or as to any of its terms 11.__ _THE Trustees shall not be personally liable on contract mode by them in the administration of the Trust and persons entering into contract with the Trustees shall look solely to the Trust Fund lA. WITHOUT prejudice to the right under the general lav of the Trustees to refuse disclosure of any document,it is hereby declared that the Trustees shall not bo bound to disclose to any person any of the following documents that is to say:(1) Any document disclosing any deliberations of the Trustpcs (or any of the Trustees) as to the manner in which the. Trustees should exercise any power or any discretion conferred upon the Trustees by this Settlement or disclosing the reasons for any particular exercise of any such power or any such discretion or the material upon which such reasons shall or might have been based ‘ (2) .Any other document relating to the exeraise or proposed ' exercise of any power or any discretion conferred on the Trustees oy this Settlement (not- being legal advice obtained oy the Trustees at the cost of the trust estate) ANp_ITr_IS_EXPnESSIrY_PROV;XDED that the TRUSTEES MAT PERMIT ANT Beneficiary personally to inspect any copy of this, Settlement or any documents relating to the Trust at the principal office of any corporate trustee hereof out shall not be bound to give any further information to any Beneficiary relating to the affairs of the Trust or to permit any Beneficiary to make any»-«opies of any documents relating to the Trust 15. ?!P£ settlement is made under the laws of the Cayman Islands and the rights of all parties and the construction and effect of each and every provision hereof shall oe subject to the exclusive jurisdiction of and construed only according to the laws of the Cayman Islands which shall be the forum for the administration of this Trust PROVIDED however that the Trustees may from t i m e to timo during the . Accumulation Period by deed declare that this Trust and the rights of all parties and the construction and effect of the provisions hereof shall from the date of such declaration be subject to the exclusive jurisdiction of and construed only according to the laws of some other jurisdiction (other than the Cayman Islands) in which one or more....-- of the Trustees then serving in office in resident and that the forum for the administration of this Trust shall thenceforth be such other jurisdiction PROVIDED further that the Trustees may not declare that this Trust and the right of all parties and the construction and effect of the provisions hereof shall be subject to the jurisdiction of and construed according to the laws of a jurisdiction which would * cause a material change in the rights of the Beneficiaries hereunder or which would not repognise the validity of this Trust if such non-recognition would result in the revocation or termination of the Trust 1. __ ANY person of full age to whom or for whose benefit any capital or income may be liable to be appointed transferred paid or applied by or in consequence of an exercise of any power or discretion vested in the Trustees or in any other person may by deed revocably or • Irrevocably disclaim his Interest as an object of such power or discretion either wholly or with respect to any specified part or share of such capital or income and then such power or discretion shall (despite anything contained elsewhere in this Deed pro tanto cease to be exercisable IN WITNESS whereof the said John Henry Guinness has set his hand and ' seal and the Common Seal of Guinness Mahon Cayman TxMst Limited has been hereunto affixed the day and year first above written* * «*—m * ' .One hundred pounds sterling(£100.00) 1. The Settlor The Bailee nsure Road Roadj owt Ireland and his wife or widow and issue (of whatever degree) his parents and the parents of his wife his brothers and sisters and their issue (of Whatever degree) and the brothers and sisters of his wife and their issue (of whatever degree) i . . 2. JOCAL INVESTMENTS LIMITED of George T SIGNED SEALED AND DELIVERED by the above-named in the presence oftJL U .\o ^ 0 i i t / Grqnd ' Caynan • ) ) ) THE COMMONWEAL OF GUINNESS MAHON CAYMAN TRUST LIMITED HAS BEEN HEREUNTO AFFIXED IN THE PRESENCE OF!- A ppendix X V (52) M r John G uinness, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John Guinness. a) Transcript o f evidence o f Mrs Jennifer Guinness dated 18 April 2000. b) Statement of Mrs Jennifer Guinness dated 18 April 2000. c) Trust Deed o f 28 January 1972. MRS. JENNIFER GUINNESS UNDER OATH ON TUESDAY, 18TH APRIL 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer THE INSPECTORS: MR. JUSTICE COSTELLO MS. MACKEY B.L. SOLICITOR TO THE INSPECTORS: MS. M. CUMMINS INTERVIEWEE: MRS. JENNIFER GUINNESS INSTRUCTED BY: MR. MICHAEL O'SHEA KENNEDY McGONAGLE BALLAGH 2 0 NORTHUMBERLAND ROAD DUBLIN 4 1 2 3 4 MR. JUSTICE COSTELLO: Mrs. Guinness, we will 5 start our interview. 6 Declan Costello and on my right is Ms. Mackey. 7 you know, we have been appointed two of the 8 Inspectors by the High Court. 9 who we wish to interview such as you, Mrs. Guinness, I am As I explain to people 10 that we are not a court, we are not a tribunal but 11 this is merely just an interview. 12 oath and I will ask our solicitor, Ms. Cummins, to 13 administer the oath in a moment to you. 14 one preliminary point I should make, if at any time 15 you wish to consult your solicitor about a question 16 that we ask, please tell us you wish to do so and we 17 will stop asking you questions and you can consult 18 your solicitor. 19 inform us if there is any question that we are 20 asking you on which he thinks he should give you 21 legal advice, and he can tell us and we will stop. It will be under There is Similarly, your solicitor can 22 23 24 25 26 27 28 29 I will ask Ms. Cummins to administer the oath now. 1 2 3 4 MR. JUSTICE COSTELLO: 5 I will ask Ms. Mackey to ask you some 6 7 Mrs. Guinness, questions. 1 Q. MS. MACKEY: 8 Good morning, Mrs. Guinness. 9 I am going to ask you questions by reference to the statement 10 that you supplied us with and I know all this 11 happened quite a while ago and many of the events 12 may not be clear in your mind. 13 simply do not remember something, it will be quite 14 sufficient to say that you do not remember it. 15 you have a copy of the statement that you can refer 16 to? 17 A. 18 2 Q. 19 If at any time you Do (Exhibit 1) Yes, I d o . First of all, your late husband was, I think, Chairman of Guinness & Mahon; is that correct? 20 A. 21 3 Q. That's right. You say here in your statement that after his death 22 in 1988 Mr. Traynor who was a personal friend of 23 yours asked you to call to his office and explained 24 to you the matters that you set out then. 25 Mr. Traynor a personal friend of you and your 26 husband for a long time going back a long way? 27 A. 28 4 Q. 29 Was Yes. Could you tell me a little bit about when you got to 1 Really ever since I knew John. 2 would have been in 1961 or 1962 when we came back to 3 live in Dublin. 4 5 Q 5 A 6 6 Q 7 A 8 7 Q 9 A 10 8 Q I don't remember, it He was a friend of your husband's? Yes . Before you knew him? Yes . Then of course they were both in Guinness Mahon? That's right. Apart from a business association, you and your 11 husband always had a personal friendship with 12 Mr. Traynor, would that be right? 13 A It was very closely business personal linked. I 14 don't suppose you can really divide the two, they 15 worked together and they were business partners as 16 well as friends. 17 9 Q 18 A 19 10 Q But you met socially as well? Yes . You go on to say that when Mr. Traynor asked you to 20 call in to see him, he told you, in general terms 21 anyway, that your husband had established a Trust 22 for your benefit and that of your children. 23 your husband's lifetime had you heard of this Trust? 24 A 25 You see there was Guinness Mahon Cayman. 26 11 Q 27 A 28 29 Not really. During You knew of Guinness Mahon Cayman? I knew that something existed there because he and Des Traynor went there. 12 Q 1 2 13 Q. 3 A. 4 14 Q. 5 Yes. You were aware that there was an entity called Guinness Mahon Cayman Trust? 6 A. 7 15 Q. Yes. Did you know that was a subsidiary of Guinness Mahon? 8 9 Your husband went out? A. I don't know, I didn't get involved in the details 10 at all, I am afraid. 11 an interest in Cayman. 12 16 Q. I just was aware that they had What did you know then about a Trust that might have 13 been set up for your benefit and your children 14 during your husband's lifetime? 15 A. 16 17 Q. 17 A. 18 18 Q. 19 A. Absolutely nothing. You did not know anything about it at all? No. This was the first you heard of this Trust? Yes, you have to understand that my husband was a 20 banker, a merchant banker in the old fashioned sense 21 of the word and confidentiality meant 22 confidentiality. He never really discussed business 23 affairs with me. I used to get a bit cross with him 24 at times but he wouldn't discuss any business 25 matters with us at all. 26 19 Q. After your husband's death anyway Mr. Traynor told 27 you that your husband had in fact established this 28 Trust? 29 1 20 Q. 2 A. 3 21 Q. 4 A. 5 22 Q. 6 A. 8 23 Q. 9 A. 10 24 Q. 11 Did he tell you it was a discretionary Trust? He didn't go in to details. Did he explain when or how the Trust had been set No. He did say it was in the Cayman Islands? Yes. Did he say Guinness Mahon Cayman Trust was the Trustee? A. I have no idea. I am sorry, I really just don't remember. 13 14 Not really. up? 7 12 Can you recollect what he told you about that Trust? 25 Q. I am asking you detailed questions about it because 15 they might jog your memory. 16 Mr. Furze in connection with it? 17 A. Did he mention a I knew the name, but it was more John Collins I 18 think is a name that I remember. 19 ever met Mr. Furze. 20 26 Q. 21 A. 22 27 Q. I am not sure if I You met Mr. Collins, did you? I think so. Anyway in connection with this particular occasion 23 when Mr. Traynor told you about the Trust, you do 24 not recollect that he mentioned Mr. Furze as being 25 involved? 26 A. 27 28 Q. 28 29 No. He told you apparently that you and your children 1 29 Q 2 3 funds of the Trust? A 4 5 I don't think so, he just said there was a Trust in Cayman for us. 30 Q 6 That was really all you remember. Does the name National Finance Association ring any bells? 7 A 8 31 Q 9 10 Did he say to you that a company was holding the No, I am afraid not. You do not remember him mentioning that in connection with the trust? A Mr. Traynor very seldom said very much. He would 11 have just said there was a Trust in Cayman for us 12 and that would have been the end of the matter. 13 32 Q 14 15 Would he have explained how you were going to benefit from this Trust? A 16 He sort of indicated if I needed money to spend, I could ask for it. 17 33 Q 18 A 19 34 Q Ask him? Yes . Did he give you the impression that that would not 20 be a problem, that at any time you required money 21 you should just ask him? 22 A Yes, I think he probably did, but again it wasn't 23 money to be used day to day in Ireland. 24 money to spend on holidays, airline tickets and that 25 sort of thing. 26 draw down on a regular basis money to use in 27 Ireland. 28 35 Q 29 A It was I wasn't to assume that I could just You could draw it down, that was the point? 1 On the occasions, because you say in your statement 2 you subsequently availed of that from time to time, 3 on the occasions in which you did, what did you do? 4 Did you ring him or write to him? 5 A 6 37 Q 7 A 8 38 Q 10 A 11 39 Q 'Des, look I am going to Australia' or You would just tell him the amount you wanted? Yes. It was never in cash, it would always have On occasion would it be transferred to your bank account? 14 A 15 40 Q 16 A 17 Not in this country. In London? I had an account in Barclays Bank in Great Missenden, 41 Q 19 20 I would say, been in travellers cheques. 13 18 What would you say to him? I am going to wherever and he would say 'fine'. 9 12 I rang him. I think. On occasion if you wished funds transferred to that account, you told him; is that it? A I can't really remember. I remember going to CRH 21 and collecting travellers cheques but I don't 22 remember -- I was trying to remember about the 23 Barclays bank accounts that you asked about, but I 24 don't really remember. 25 You do not remember. 26 between Des Traynor and Guinness Mahon in relation 27 to those which I will show you in a moment. 28 you wished to have travellers cheques, having 29 contacted Mr. Traynor, you would go along to his We have some correspondence When 1 2 A. 3 43 Q. 4 A. 5 44 Q. 6 A. 7 45 Q. Yes. You would meet occasionally Ms. Williams? Yes. You knew Ms. Williams? Yes. You say in the second paragraph of your statement: "After my return to Ireland I saw Mr. Traynor from time to time and on many of these occasions he showed me statements which gave the value of the Trust." 8 9 10 11 12 Could you tell me a little bit about these 13 statements. 14 A. 15 4 6 Q. 16 A. 17 47 Q. Did he give them to you? No. He showed them to you? Yes. At the time, going back to when he first told you 18 the Trust was being set up, did he give you 19 documents in relation to it? 20 A. 21 48 Q. 22 A. 23 49 Q. 24 No. None at all? No. Did you ask him if he could provide you with documents ? 25 A. 26 50 Q. 27 No. In relation to the statements, can you describe them to me? 28 A. 29 51 Q. They were just ....(INTERJECTION). Were they on headed paper? 1 They were sort of like bank statements, I don't 2 think they had any heading. 3 52 Q 4 A 5 6 They looked like bank statements. I didn't really pay a lot of attention to them. 53 Q 7 Do you recollect if they had the name of a bank or a company on top? 8 A 9 54 Q 10 A 11 No, I don't. Do you recollect if they were unheaded? They weren't on formal headed paper like that, they were just a bank statement. 12 55 Q 13 A 14 56 Q 15 16 Just like bank statements? What sort of information appeared on those? Probably a list of stocks and shares. A list of stocks and shares. Did these appear to be the statement of affairs of a company? A I have no idea. I presumed they were just the 17 things that John had had in this Trust and I was 18 supposed to just have a look at them. 19 57 Q 20 A 21 58 Q 22 A Would Mr. Traynor go through them with you? Not really. He would just hand them to you? Yes, I think probably to keep his records straight 23 or something. 24 because I am supposed to look at my stocks and 25 shares, but I just look at them. 26 59 Q 27 I get statements every so often Would it ultimately show the balance of the funds held? 28 A 29 60 Q But I don't remember what it was. You do remember that there was a balance, it would 11 1 2 I imagine so, most bank statements do, but I am 3 awfully hazy about it, it was just a piece of 4 statement. 5 61 Q showed a balance? 6 7 It showed transactions and almost certainly it A I am sure it would have shown a balance but it was 8 more a list of stocks and shares and I don't think 9 it showed transactions. 10 loss statement or anything like that. 11 62 Q 12 A 13 63 Q 14 15 There was no profit and As you say, it was like a bank statement? Like a bank statement. Like a bank statement did it show the interest that had accrued? A I don't know, I shouldn't think so, I just don't 16 know. 17 down the left-hand side and, presumably, it had a 18 valuation. 19 64 Q I just remember a list of stocks and shares When Mr. Traynor told you this Trust had been set 20 up, did he tell you the value of the Trust? 21 not asking you for the value, but whether he told 22 you about it at the time? 23 A I am I am sure I probably could have looked at the list 24 of stocks and shares and worked it out, but we 25 didn't mention ....(INTERJECTION). 26 65 Q 27 28 29 Do you recollect whether it was a substantial amount ? A I don't, but I assume it probably was a reasonable amount, but that is as much in hindsight. 1 66 Q Moving on down through your statement, well, just 2 before we come to that, were you one of the 3 executors of your husband's estate, Mrs. Guinness? 4 A 5 67 Q 6 A 7 68 Q 8 A You were? I don't know. Could I ask? Certainly. Yes, I think Peter and I were, my brother in-law and I. 9 10 Yes . 69 Q Can you recollect at this stage Mrs. Guinness, and I 11 realise you might not be prepared for this question, 12 can you recollect when returning a schedule of your 13 husband's assets to the Revenue Commissioners in the 14 administration of his estate if you listed as an 15 asset the Trust funds? 16 A 17 70 Q 18 A 19 71 Q 20 A 21 72 Q I think I discovered about the Trust much later. After the estate had been administered? I don't know, I really don't. You cannot remember the sequence? No, I can't remember the sequence. So you cannot say whether or not you returned the 22 Trust funds on the schedule of assets for the 23 estate? 24 A 25 73 Q 26 A I didn't. You did not, okay. I don't think I really realised the Trust funds had 27 anything to do with the estate in Ireland. 28 all a bit hazy. 29 disinterested, but friends of John's were sort of It is It sounds as though I was very 1 minding me and I really didn't express any huge 2 interest in anything. 3 7 4 Q. Did you have a legal advisor or accountant at that 4 stage that might have been dealing with those 5 matters ? 6 A. 7 75 Q. 8 A. 9 With what? To help you with the administration of the estate. There were so many, there were a huge number of people helping. 10 76 Q. 11 A. 12 77 Q. Did you have a specific solicitor? Liam McGonagle. Would he have been dealing with the legal affairs, 13 winding up your husband's affairs and so on of his 14 estate? 15 A. 16 78 Q. 17 Pretty well so, yes. Were you yourself, Mrs. Guinness, a beneficiary under your husband's will? 18 A. 19 79 Q. 20 A. 21 80 Q. 22 Yes, because I inherited it all. You were the sole beneficiary? Yes, I think so, apart from a few small bequests. Could you, Mrs. Guinness, provide us with a copy of the will and the Revenue affidavit? 23 A. 24 81 Q. I am sure I could, yes. Thank you very much. Going back to your statement 25 here, you say in the second paragraph that at some 26 of these meetings you had with Mr. Traynor you 27 expressed a general unease about the Trust. 28 you tell me a little more about that and why you 29 became uneasy? Could 1 2 didn't like that because my father had been a member 3 of Lloyds and you felt your whole house was at risk 4 and I don't really like stocks and shares very much. 5 I don't really have a huge interest, so I wanted to 6 get out of that, out of Lloyds. 7 the same sort of thing, it was just something I 8 didn't understand. 9 maybe if you were a banker you could handle, but I 10 11 This thing was much I felt that it was something didn't like it. 82 Q. You go on to say that you think on reflection this 12 was because of a nagging worry about taxation, what 13 specifically worried you about the taxation aspects 14 of it? 15 A. 16 17 collect travellers cheques. 83 Q. 18 19 It was a little bit cloak and dagger going to You felt the secrecy aspect of it did not appeal to you? A. I just believe if you live in a country you should 20 pay your taxes. 21 you pay your taxes in the country you live in, like 22 paying VAT on boats and things. 23 if you pay your tax, then you don't have to worry. 24 84 Q. 25 26 Life is much less complicated if It is much easier Did you understand at that time that in some way or other tax was not being paid on these transactions? A. I was beginning to wonder but again, I suppose I 27 didn't question because these were, as far as I was 28 concerned, very reputable people who had been 29 friends and it is very hard to believe that the 1 person -- I mean banking was a very respectable 2 profession and it is very hard to believe that 3 people aren't as straight... 4 85 Q 5 A As you expect. It took a long time, I suppose, before I actually 6 began to worry. 7 together and it was a long time before I started to 8 question. 9 86 Q I was trying to get my life When you did begin to worry you mentioned it to 10 Mr. Traynor, as you say here. 11 you expressing worry about the taxation aspect of 12 it? 13 A How did he react to Did he reassure you? I am sure he probably did. The sequence of events, 14 I don't really remember. 15 Amnesty coming up and the huge relief that now this 16 was going to be easy to deal with. 17 87 Q I do remember the Tax By the time the Tax Amnesty came up then, you were 18 in your own mind satisfied that tax was due, on the 19 interest on this deposit; is that correct? 20 A I suppose it seemed like a golden opportunity to 21 clear the whole thing up because people weren't 22 giving me, perhaps, the straightest of answers when 23 I did ask. 24 88 Q 25 A 26 89 Q 27 28 29 People being? Well, Des. You felt he was not explaining the things correctly to you? A No, I don't even remember what I asked him. As I say, it was just a general feeling that this perhaps 1 2 90 Q. In relation to the Tax Amnesty then, were you 3 complying with the Tax Amnesty specifically in 4 respect of the interest that was accruing on the 5 Trust funds? 6 A. 7 91 Q. 8 A. 9 92 Q. I have no idea. Mr. Reid was your advisor there? Yes. Mr. Reid, as you say, came to advise you about that. 10 You had heard of him but you had not met him, so do 11 you know whether he advised your husband originally 12 in the setting up of this Trust? 13 A. 14 I have no idea. I think the Trust was there for a long, long time. 15 93 Q. 16 A. 17 94 Q. You do not know when it was set up, do you? No. Did Mr. Reid, when he came to advise you on this, 18 did you have to explain to him the setting up of the 19 Trust or had Mr. Traynor done that? 20 A. No, it was slightly different. Mr. Traynor just 21 said Don Reid would set it up and deal with it all 22 for me, so I just went along to SKC, I think it was 23 then, and just signed a piece of paper. 24 95 Q. 25 You just signed a piece of paper, there was no discussion about the Trust or anything else? 26 A. 27 96 Q. 28 A. 29 97 Q. No. You had no discussions whatsoever with Mr. Reid? No. None? 1 A. I suppose I might have met him, but I don't think 2 there was any detailed discussion. 3 with i t . 4 98 Q. 5 He just dealt We must presume then that the information he got, he got from Mr. Traynor? 6 A. 7 99 Q. Yes. It would appear then that Mr. Reid must have a 8 certain amount of knowledge about the workings of 9 this Trust and how it was set up and so on. If we 10 contact him, he should be able to give us some 11 information or tell us what documents he had before 12 him at that stage? 13 A. I have no idea. There was a promise of 14 confidentiality around the Tax Amnesty, so I am not 15 sure that he would know. 16 100 Q. 17 A. 18 101 Q. That he himself would know? I don't know. I think the confidentiality related to not revealing 19 the details of the person availing of the Amnesty or 20 complying with the Amnesty. 21 A. 22 102 Q. I have no idea, I didn't see the legislation. Presumably Mr. Reid in order to undertake 23 negotiations with the Revenue Commissioners must 24 have known something about your affairs or your 25 husband's affairs? 26 A. 27 103 Q. I presume so. You then say that the assets of the Trust were 28 appointed to yourself and to your children at this 29 time and the Trust was dissolved. How do you know 1 2 A. 3 104 Q. 4 A. 5 105 Q. 6 A. 7 1 0 6 Q. t h e m o n e y j u s t a r r i v e d in I r e l a n d . Y ou d i d not see a D eed of A p p o i n t m e n t ? No. D i d Mr. Traynor say anything? No. W h e n yo u sa y the m o n e y a r r i v e d in Ireland, did you a s k t h a t it w o u l d a r r i v e o r h o w d i d t h a t c o m e a b o u t ? 8 9 Well, A. No, it d i d n ' t go t o G u i n n e s s M a h o n , it w e n t to N C B 10 b e c a u s e we h ad f allen out wi t h Gu i n n e s s Mahon, 11 no mor e a c c ounts wit h G u i nness Mahon. 12 107 Q. What I a m r e a l l y t r y i n g to f i n d o u t h e r e is w h a t 13 c a u s e d t h e m o n e y to a r r i v e in I r e l a n d . 14 decision must have been made by somebody. 15 A. 16 17 I had Some I a m s u r e D e s j u s t a r r a n g e d f o r it t o be transferred. 108 Q. 18 D i d he tell yo u he was g o i n g to do this or d i d you ask him? 19 A. 20 1 0 9 Q. 21 A. 22 110 Q. I h a v e n o i dea. T h e m o n e y came . It a r r i v e d in N C B u n d e r y o u r n a m e ? Yes, it j o i n e d i n t o m y p o r t f o l i o t h e r e . I n N CB . When you say the Trust was dissolved, 23 s i m p l y m e a n t h a t n o m o r e h a p p e n e d a f t e r t ha t . 24 f a r as y o u w e r e c o n c e r n e d 25 A. 26 111 Q. 27 A. 28 112 Q. 29 A. you As ....(INTERJECTION). It w a s c l o s e d down . Y o u do n o t h a v e a d o c u m e n t o r a n y t h i n g t o s h o w ? No. O r a n y l e t t e r f r o m Mr. No. Traynor? Y o u s e e it w a s n ' t r e a l l y m y T r u s t a n y w a y . If 1 it h a d b e e n m y T r u s t , 2 w i t h it, 3 was ove r s e a s and I just h a p p e n e d to be the 4 b e n e f i c i a r y o f it. 5 p a r t i n it. 6 113 Q. Yes, I w o u l d h a v e b e e n able to deal it w a s n ' t m y T r u s t , I understand. it w a s something that I r e a l l y d i d n ' t h a v e a n y h a n d or I w o u l d just like to show you 7 s o m e of t h e c o r r e s p o n d e n c e t h a t w e h a v e b e t w e e n 8 Des T r a y n o r and G u i n n e s s Mahon, 9 you recognise p articular payments r e f e r r e d to a n d so 10 on. C o u l d w e l o o k at p a g e 11 MRS . G U I N N E S S ) ( E x h i b i t 2). 12 t h e r e i n f r o n t o f y o u w h i c h is a l e t t e r f r o m 13 G u i n n e s s M a h o n f r o m Mr. 14 to D a v i d H u m p h r i e s 15 it a s k s h i m t o h a v e t r a v e l l e r s 16 a n d at t h e b o t t o m y o u s e e t h e a m o u n t is t o be 17 d e b i t e d to t h e A n s b a c h e r L i m i t e d a c c o u n t , 18 13154602 and that was the A n s b a c h e r p o o l e d account 19 in G u i n n e s s M a h o n in w h i c h v a r i o u s p e o p l e w ho h a d 20 accounts with Ansbacher had their sub-accounts and 21 from which they could wi t h d r a w money. 22 r e c o l l e c t t h a t p a r t i c u l a r t r a n s a c t i o n o r d o e s it 23 a p p e a r to y o u t o b e o n e o f t h e t r a n s a c t i o n s y o u h a v e 24 been talking about? 25 A. 12 j u s t t o a s k y o u if (SAME H A N D E D TO You have a document T r a y n o r on 4th D e c e m b e r 1990 of G u i n n e s s M a h o n . cheques r e a d y for you about. 27 A u s t r a l i a i n D e c e m b e r 1 9 9 0 o r 1989, 28 have been 114 Q. number Do y o u I p r e s u m e it is o n e of t h e o n e s w e a r e t a l k i n g 26 29 Y o u se e t h e r e I w a s t r y i n g to r e m e m b e r w h e t h e r w e w e n t to b u t it w o u l d ....(INTERJECTION). In a n y e vent this w o u l d a p p e a r to yo u to be the kind 1 of t r a n s a c t i o n w h e r e b y y o u w o u l d go t o Mr. 2 and ask for m o n e y from the Trust? 3 T h a t ' s right. 4 115 Q It a p p e a r s Traynor from this d o c u m e n t that in fact the m o n e y 5 w a s c o m i n g o u t o f a n a c c o u n t i n G u i n n e s s M a h o n in 6 the name of A n s b a c h e r ? 7 A 8 116 Q 9 Yes . C a n I a s k y o u to l o o k at a n o t h e r d o c u m e n t w h i c h is p a g e 21. (SAME H A N D E D T O MR S. GUINNESS)(Exhibit 10 A g a i n y o u s e e it is a s i m i l a r l e t t e r f r o m 11 Mr. 12 d a t e d 1 6 t h N o v e m b e r 1992. 13 d e b i t e d is to b e d e b i t e d to A n s b a c h e r L i m i t e d Re 14 Poinciana Fund Number 2 account. 15 m e a n anything, 16 A 17 117 Q 18 No, T r a y n o r to t h e s a m e p e r s o n in G u i n n e s s M a h o n H e r e t h e a m o u n t to b e A 20 118 Q Does that name have you ever h eard that? I a m a f r a i d not. A g a i n does that a p p e a r to be one of the t r a n s a c t i o n s t h a t y o u w o u l d h a v e h a d w i t h Mr. 19 3). I presume Traynor? so. I will just s h o w y o u m a y b e t w o m o r e of a r o u n d t h a t 21 time, 22 MRS . 23 j u s t l o o k at a l l o f th o s e , 24 c o n f i r m to m e t h a t t h e y a p p e a r t o y o u t o b e t h e 25 transactions 26 If w e c o u l d j u s t g o t h r o u g h t h e m p a g e b y p a g e, 27 w i l l s e e t h a t t h e p a g e s a r e n u m b e r e d d o w n at t h e 28 b o t t o m right h a n d corner, 29 in that order. p a g e 13 a n d 14. GUINNESS)(Exhibits (SAME H A N D E D T O 4 & 5). Mr s. Actually, Guinness, if y o u and y o u w e r e c a r r y i n g o u t w i t h Mr. Traynor. you so i f w e g o t h r o u g h t h e m P a g e 13 is a l e t t e r o f 1 2 t h A u g u s t 1 1991 ( E x h i b i t 4 ) a n d it is s i g n e d w i t h an 2 indecipherable 3 it is a d d r e s s e d t h i s t i m e to I r i s h I n t e r c o n t i n e n t a l 4 Bank. 5 t h e A n s b a c h e r a c c o u n t w a s t r a n s f e r r e d at a 6 particular point 7 I n t e r c o n t i n e n t a l B a n k w h i c h is w h y he is w r i t i n g 8 there. 9 a t r a n s f e r to y o u r a c c o u n t in B a r c l a y ' s a n d a g a i n signature for A n s b a c h e r L i m i t e d and I do n o t k n o w w h e t h e r y o u k n o w or n o t t h a t from G u i n n e s s M a h o n to Irish A g a i n y o u see it is i n r e s p e c t t h i s t i m e o f 10 t h e c o s t is t o b e d e b i t e d t o t h e A n s b a c h e r a c c o u n t , 11 t h i s t i m e in IIB. 12 I never w o u l d have seen these letters, 13 o n l y j u s t r u n g D e s a n d said, 14 more m o n e y . ' 15 119 Q 'look, I would have I need a bit A l l I a m c o n c e r n e d w i t h at t h i s s t a g e is t o s e e 16 w h e t h e r t h e y a p p e a r to be the sort of t r a n s a c t i o n s 17 y o u w o u l d h a v e g o n e t o Mr. 18 A 19 20 I don't really know because T r a y n o r about. I wasn't really involved i n t h i s e n d o f it. 120 Q W h e n I s a y t h e s o r t of t r a n s a c t i o n s , you w o u l d be 21 a s k i n g h i m to t r a n s f e r £ 2 , 0 0 0 t o y o u r a c c o u n t in 22 Barclay's. 23 you w i t h d r a w i n g m o n e y from the Trust fund? 24 A 25 121 Q Unlikely, It is u n l i k e l y to b e a n y t h i n g o t h e r t h a n yes. If w e l o o k at p a g e 26 13th December 27 by Joan Williams, 28 A 29 122 Q 14, (Exhibit w e s e e a l e t t e r of 6) a n d it is s i g n e d t h i s t i m e w h o w a s Mr. Traynor's secretary? T h a t ' s right. To I I B a n d a g a i n it r e f e r s to a t r a n s f e r , 22 this time 1 2 3 123 Q. 4 T h e c o s t to b e d e b i t e d t o A n s b a c h e r . Page 16, (Exhibit 7 ) a similar t r a n s a c t i o n signed by Joan 5 W i l l i a m s to IIB, 6 t r a n s f e r o f s t e r l i n g to B a r c l a y ' s Ba n k , 7 b e d e b i t e d to A n s b a c h e r . 8 2 3 r d S e p t e m b e r 1992 9 t r a n s f e r of £ 5 , 0 0 0 s t g . 2 n d M a r c h 1 9 9 2 a n d it is a n o t h e r t h e c o s t to O n p a g e 17 y o u h a v e t h e ( E x h i b i t 8) a n d t h i s t i m e a to B a r c l a y ' s a n d t h e c o s t to 10 b e d e b i t e d to A n s b a c h e r . 11 1993 12 is a t r a n s f e r of £ 5 , 0 0 0 s t g . 13 Barclays 14 c o s t to t h e H a m i l t o n R o s s a c c o u n t . 15 with that? 16 Mr. 17 who had a relationship with Ansbacher, 18 in A n s b a c h e r . 19 10) 20 £6,000stg. 21 F i n a l l y p a g e 20, 22 t r a n s f e r o f £ 3 , 0 0 0 to B a r c l a y ' s Ba n k . That appears 23 to be q u i t e a n u m b e r of t r a n s a c t i o n s i n t h e s p a c e of 24 a c o u p l e of years. 25 o n a f a i r l y f r e q u e n t b a s i s as is i n d i c a t e d b y t h o s e ? 26 A. At page a n d it is 8 t h F e b r u a r y 18 w e a r e in to (Exhibit 9 ) a n d a g a i n it to y o u r a c c o u n t in a n d t h i s t i m e it r e f e r s t o d e b i t i n g t h e Are you familiar A g a i n that was a further account used by T r a y n o r i n w h i c h to k e e p t h e f u n d s of p e r s o n s O n p a g e 19, who had money 3 r d M a r c h 1993, (Exhibit J o a n W i l l i a m s w r i t i n g to I I B a s k i n g t o t r a n s f e r t o y o u r a c c o u n t in B a r c l a y ' s Bank . o n 1 7 t h M a y 1 9 9 3 t h e r e is t h e Would you have been withdrawing I a m j u s t t r y i n g t o r e m e m b e r w h a t I s p e n t it on. 27 k n o w I s p e n t a lo t o n a i r f a r e s b e c a u s e 28 sailing around the w orld and I came b a c kwards and 29 f o r w a r d s q u i t e a lot. I was T h e r e s t w o u l d h a v e b e e n on I 1 going to Lo n d o n and clothes, 2 G e t t i n g b a c k t o t h e r e t u r n o f t h e fu nd s, 3 h a v e b e e n l a t e r in 1993, 4 19 94 5 Amnesty? 6 A 7 125 Q that sort of thing. w a s it, that must or w a s it e a r l y in that that h a p p e n e d w h e n you c o m p l i e d w i t h the L a t e 1993. J u s t a g a i n to t r y a n d c l a r i f y w h a t a c t u a l l y h a p p e n e d 8 a n d h o w t h e f u n d s c a m e b a c k to N C B . 9 t h a t w h e n e v e r y o u w i s h e d to c a r r y o u t s o m e 10 t r a n s a c t i o n y o u c o n t a c t e d Mr. 11 d i d t h e rest. 12 A 13 126 Q Here we see T r a y n o r a n d t h e n he Yes . W h e n it c a m e to c o m p l y i n g w i t h t h e T a x A m n e s t y , you 14 n e e d e d to h a v e t h a t m o n e y b a c k h e r e a n d d i d y o u t h e n 15 a s k Mr. 16 A T r a y n o r t o r e t u r n t h e b a l a n c e o f it h e r e ? A s f a r as I r e m e m b e r w h e n t h e T a x A m n e s t y w a s 17 announced, 18 c o m e o v e r b e c a u s e he w a s r e a l l y m y 19 ....(INTERJECTION). I r a n g m y b r o t h e r - i n - l a w a n d a s k e d h i m to 20 127 Q Mr. T r a y n o r r a n g you? 21 A No, I did. W e w e n t t o s e e De s a n d said, 'look, a n d h e said, I 22 want to avail of the Amnesty' 23 w i l l a r r a n g e it' 24 t h i n g w a s h e s a i d t h a t D o n R e i d w o u l d a c t f o r u s in 25 t h i s m a t t e r a n d n e g o t i a t e w i t h t h e R e v e n u e here . 26 Then e v e n t u a l l y we just went a lo n g a nd s i g n ed some 27 papers 28 shares, 29 t r a n s f e r r e d t o NCB. as f a r as I r e m e m b e r . 'fine, I The next an d the m o n e y was t r a n s f e r r e d to m y sto c k s or wel l , the stocks and shares must have been 1 128 Q. H o w d i d y o u k n o w it h a d b e e n t r a n s f e r r e d ? 2 A. B e c a u s e it a p p e a r e d i n m y a c c o u n t i n NCB. 3 1 2 9 Q. 4 to h a p p e n ? 5 A. 6 130 Q. 7 8 I don't understand. T h e m o n e y w a s o v e r t h e r e i n C a y m a n or i n D u b l i n , w h e r e v e r it was, A. 9 it w a s in a T r u s t ? I n e v e r th o ug h t of the m o n e y b e i n g in Dublin. I a l w a y s a s s u m e d t h a t it w a s a c t u a l l y g e n u i n e l y in a b a n k in Cayman. 10 11 Did anyone tell you before that that this was going 131 Q. W h e r e v e r it p h y s i c a l l y was, it w a s i n T r u s t somewhere? 12 13 A. 14 132 Q. Yes. B ec a u s e of the Tax A m n e s t y a nd because, as y o u 15 explained, 16 y o u w a n t e d to m a k e a s e t t l e m e n t w i t h t h e R e v e n u e 17 Commissioners, 18 then, 19 this Trust? 20 A. 21 133 Q. y o u w a n t e d t o c l e a r u p t h e w h o l e th i n g , pa y whatever tax was outstanding and presumably, yo u w a n t e d to be f i n i s h e d w i t h Yes. Mr. R e i d on your b e h a l f dealt w i t h the R e v e n u e 22 Commissioners, 23 the Trust? 24 d o w n t h i s T r u s t a n d b r i n g t h e m o n e y b a c k he r e ' 25 what? 26 A. 27 28 29 134 Q. D i d y o u s a y t o Mr. I s u p p o s e so, happened. but how exactly did you finish with Traynor, I don't really remember. 'look, close or It j u s t He m u s t h a v e c l o s e d it do w n . It is j u s t t h a t o b v i o u s l y y o u k n o w t h e s e t h i n g s do not just happen by themselves. S o m e o n e w a s g i v e n an 1 2 3 135 Q. 4 A. Y o u a c t u a l l y s a i d to h i m ? I d o n ' t r e m e m b e r w h a t I s a i d to him, but I just 5 assume that 6 Des, 7 He w o u l d h a v e t h e n s a i d it w a s a l l g o i n g t o b e 8 t i d i e d up and b r o u g h t b a c k here. 9 the actual w ords of the conversation. 10 1 3 6 Q. I was s i t t i n g a r o u n d a n d said, I w a n t to f i n i s h w i t h this , I a m s u r e y o u d o not. 'look, I d o n ' t l i k e it.' I don't remember W o u l d he not have a s k e d you w h a t y o u w a n t e d to d o w i t h t h e s e f u n d s ? 11 12 A. 13 137 Q. T h e y w o u l d h a v e come b a c k h e r e to m y p o r t f o l i o . I k n o w t h a t is w h a t h a p p e n e d , as y o u h a v e e x p l a i n e d . 14 S o m e o n e m u s t h a v e a s k e d y o u if t h a t w a s w h a t y o u 15 w i s h e d to d o o r d i d y o u w i s h to p u t t h e m i n a b a n k 16 a c c o u n t or w h a t d i d you w i s h to do w i t h t h e s e funds 17 that were n o w g oing to come back? 18 A. 19 138 Q. 20 A. T h e y w e r e in stoc k s an d shares. Anyway. Yes, I didn't transfer cash into stocks and shares. 21 A s I u n d e r s t o o d it, 22 Cayman, 23 a n d I t h o u g h t t h a t t h e b a n k in C a y m a n w o u l d j u s t 24 m e r e l y t r a n s f e r it or t h e a s s e t s o f t h e T r u s t w h i c h 25 w e r e in stoc k s a n d shares, 26 A m e r i c a n and some of t h e m w ere E n g l i s h a nd t hey 27 w o u l d h a v e c o m e a c r o s s a n d g o n e t o NCB. 28 29 1 3 9 Q. t h e r e w a s a s o r t of p o r t f o l i o in i n n o c e n t l y I t h o u g h t it w a s a c t u a l l y t h e r e s o m e of t h e m w e r e C l e a r l y there were funds apart from stocks and 1 I h a v e n o idea, 2 detail. 3 that , 4 t h e y sold stocks a n d shares, 5 a n d s h a r e s h a d s o m e s o r t o f v a l u e or i n c o m e . 6 140 Q 7 8 A presumably, so w a s w h e r e -- I d i d n ' t k n o w w h e t h e r I presume that stocks C l e a r l y the m o n e y was coming from s o mewhere that you Yes, I p r e s u m e d that was the income f rom the stocks a n d s h a r e s in C a y m a n . 10 141 Q 11 A W h a t h a p p e n e d to that i n c o m e ? I d o n ' t know, a lo t of it m u s t h a v e g o n e t o p a y t h e taxman. 12 142 Q 14 15 You get i n t e r e s t on stocks a n d shares, could draw upon? 9 13 I don't t h i n k I e ven t h o u g h t of the D i d y o u a s k De s T r a y n o r to b r i n g t h a t b a c k or d i d you distinguish between that? A I d i d n ' t d i s t i n g u i s h at all, I just said I want e d 16 t h e w h o l e t h i n g s h u t dow n . 17 ha d to sell some stocks and shares to p a y the tax 18 b il l , 19 around, 20 p ayi n g the Revenue. 21 143 Q A 24 25 144 Q Is it y o u r u n d e r s t a n d i n g t h a t Mr. at t h e e n d of Reid would have I d o n ' t k n o w w h e t h e r he d i d o r Des did, but somebody D i d yo u h a v e a n y o t h e r a d v i s o r s or a n y o t h e r a c c o u n t a n t at t h a t s t a g e ? A No. SKC, a nd I don't know who was a c t u a l l y the regular accountant 28 29 I wouldn't have thought, did. 26 27 so t h e r e w o u l d n o t h a v e b e e n c a s h l y i n g d ealt w ith that a spect of things? 22 23 I presume they must have 145 Q in S K C ....(INTERJECTION). 1 T h e y were , 2 now. 3 Yes, 4 w e r e w o r r i e d a b o u t t h e T r u s t a n d y o u w e r e t a l k i n g to 5 Mr. 6 accountants 7 A yes, a n d t h e y s t i l l are. t h a t ' s right. D u r i n g all of this t i m e w h e n you T r a y n o r a b o u t it, Y o u see, did you discuss that with your f r o m S K C at t h a t s t a g e ? I wasn't really worried. 8 respectable 9 n a g g e d away. The y are KMPG friend, Des was a it w a s j u s t s o m e t h i n g t h a t I d idn't get up e v e r y m o r n i n g or I 10 didn't 11 h i m up w h e n I a s k ed h i m for money, 12 d i s c u s s i n g it w i t h h i m o n a r e g u l a r b a s i s . 13 147 Q s e e De s m o r e t h a n m a y b e o c c a s i o n a l l y a n d r i n g You did not but I w o u l d n ' t be feel you n e e d e d a ny i n d e p e n d e n t a d vice 14 o n t h i s w h o l e t h i n g t o s e e w h e t h e r it w a s o k a y to 15 c o n t i n u e w i t h d r a w i n g or n o t ? 16 A 17 148 Q 18 A It n e v e r o c c u r r e d t o m e t h a t it w a s n ' t . You were a little bit worried? Yes, b u t it t o o k a l o n g t i m e b e f o r e -- I s p e n t 19 c o u p l e of y ears t r a v e l l i n g a n d g e t t i n g o r g a n i s e d an d 20 it t o o k a b i t of t i m e b e f o r e 21 g e t a h a n d l e on t h i n g s . 22 didn't really matter, 23 important. 24 149 Q 25 A 26 27 I a c t u a l l y s t a r t e d to In t h e b e g i n n i n g it j u s t money didn't seem terribly Yes . T h e r e was p l e n t y of m o n e y t h e r e for m y n e e d s an d t h a t w a s r e a l l y a l l . .. 150 Q That you w o r r i e d about. I t h i n k we m i g h t take a 28 f i v e or t e n m i n u t e b r e a k a n d h a v e a c u p o f c o f f e e , 29 Mrs . Guinness, a n d we w i l l c o m e b a c k . I will not 1 h a v e v e r y m u c h m o r e t o a s k y o u a f t e r t h a t a n d it 2 w i l l give yo u t i m e to t a k e a breath. 3 4 (S HO RT A D J O U R N M E N T ) 5 MR. 6 JUSTICE COSTELLO: Mrs. 7 Guinness, we h a v e no f u r t h e r q u e s t i o n s to as k 8 you. W hat you said t o d a y will be t r a n s c r i b e d now 9 a n d w e w o u l d a s k y o u to c o m e in t o s i g n t h e 10 transcript, 11 T h e r e is o n e s l i g h t c o r r e c t i o n t h a t M i c h a e l O ' S h e a 12 s a y s I s h o u l d m a k e a n d I w a s t h i n k i n g a b o u t it, 13 i m m e d i a t e l y a f t e r J o h n d i e d Pa t M c C a n n d e a l t w i t h 14 t h e r e g u l a r t a x r e t u r n s to t h e R e v e n u e b e c a u s e h e 15 h a d an o f f i c e just around, 16 I d i d n ' t d e a l w i t h SKC, 17 Partners. 18 151 Q 19 A A He r e t u r n e d MACKEY: but so i m m e d i a t e l y a f t e r w a r d s I d e a l t w i t h Pa t M c C a n n & ....(INTERJECTION). McCann & Partners? W a s it M c C a n n & A s s o c i a t e s ? MR. 20 21 MS. it w i l l b e s o m e t i m e a f t e r E a s t e r . O'SHEA: I a m n o t s u r e of t h e n a m e . T h e y h a d a n o f f i c e in A n d r e w S t r e e t a n d t h e n t h e y 22 m o v e d d o w n to W i n e t a v e r n S t r e e t a n d t h e y d i d a l l t h e 23 CAT returns on the c h i ldren and e v e r y t h i n g like 24 that. 25 M S . MACKEY: 26 They would have been li k e l y to have dealt with 27 the S c h e d u l e of A ss e t s 28 I t h i n k it is p r o b a b l y -- I j u s t d o n ' t know. 29 don't know whether... for the Revenue? I 1 153 Q 2 A 3 154 Q 4 A 5 Do you know if they are still in Winetavern Street? Yes . It is called Pat McCann & Associates? I have no idea. MR. O'SHEA: 6 find the name for you. 7 8 I will try to MS. MACKEY: A 9 If you would, please. It was Pat McCann that we dealt with immediately after John died as a tax consultant. 10 I didn't have SKC in those days. 11 155 Q 12 A Okay. Just so as you are not looking in the wrong place. 13 MS. MACKEY: Thank you very much. 14 MR. JUSTICE COSTELLO: Thank you. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF INTERVIEW (5017/0 m0 7 /o Cruz? 7 f. p000 M y husband John died on 27 February 1988 and a short time afterwards D es Traynor who was a personal friend o f ours asked me to call to his office. I called as requested a short time later. Mr. Traynor spoke to me about John and w hile I do not recall his precise words the gist o f it was that my late husband John had established a trust for the benefit o f m yself and my children and that the trust w as administered in the Cayman Islands. I now realise that I did not fully appreciate what he said at the time and indeed it took me a number o f years after my husband’s death before fully appreciating the trust and other aspects o f my late husband’s business affairs. I do recall Mr. Traynor saying that if I needed funds he would arrange for payment to be made from the trust and I availed o f this suggestion to defray the costs o f a sailing trip around the world that I embarked upon after my husband’s death. Some other payments were also made to me by the trustees. After my return permanently to Ireland, I saw Mr. Traynor from tim e to tim e and on many o f these occasions he showed me statements which gave the value o f the trust. At some o f these meetings I expressed a general unease about the trust, I think, on reflexion, because o f a nagging worry about taxation and also because I had no real knowledge o f the workings o f the trust and no control over it or o f the funds in the trust. When the tax amnesty was announced it provided me the opportunity to regularise my tax affairs and Mr. Traynor agreed to assist me in this. He instructed D on Reid to act on my behalf. Mr. Reid is a tax expert o f whom I had heard but had not met. Mr. Reid made Returns to the Revenue Commissioners and entered into negotiations with them on my behalf. Settlement was reached with the Revenue Commissioners and a payment made to them from the funds o f the trust which was at that time distributed. While I signed Returns to the Revenue Commissioners I do not have copies o f these and I do not now recall the details o f the discussions and negotiations undertaken by Mr. Reid with the Revenue Commissioners on the amount paid to them. The assets o f the trust were appointed to m yself and iqy children at this time and the trust was dissolved. I had no reason to think o f the trust thereafter until the McCracken and Moriarty Tribunals. Until these Tribunals I was not familiar with the name Ansbacher (Cayman) Limited or the extent o f the trust operations o f that Bank. I do not have and never had in my possession the Trust Deed or Letter o f W ishes. I do not know who the trustees were other than that the trust was administered in the Cayman Islands. I have no knowledge o f Amiens Investments Limited or Kentford Securities Limited nor o f any o f the arrangements described in the letter to me o f 7 February 2000 from the O ffice o f the Inspectors appointed by Order o f the High Court to Ansbacher (Cayman) Limited. Dated the Signed: day o f f f ' i - f 2000 T H IS A .D . IN D E N TU R E 1972 BETW EEN •The R a i l e y , one p a rt under OF (h e re in a fte r of or made of Cayman I s l a n d s "th e successor Tru ste e s" tru ste e c a lle d I - day "th e a and c a r r y in g te rm tru ste e s of House, L IM ITE D w h ic h or k C e n su re MA HON C A Y M A N T R U S T th e X*' the (h e re in a fte r ' c a lle d is H e n ry G u in n e s s Ire la n d G U IN N E S S la w s a d d itio n a l John H o w th , and th e SETTLEM ENT C ensure S e ttlo r") Rpad, of • th e com pany in c o r p o r a t e d on b u s in e s s s h a ll a ls o h e re o f) of th e re in in c lu d e the any o th e r • p a rt WHEREAS th o F irs t S c h e d u le and p ro p e rty fo r or d im in is h m o n ts to the tru sts the h e re to the th c -ro to is d u ly t r a n s f e r r e d ■i n t o w ith th e th a t has (w h ic h tim e h e re o f in te n t S e ttlo r b e in g and the re p re s e n tin g any fu rth e r name o r same th e t o g e t h e r .w ith h e re in a fte r the caused s h a ll be th e th e "th e the any b e c o m in g Tru st upon in money in v e s tm e n ts co n tro l h e ld d e s c rib e d sam e a n d p ro p e rty c a lle d under p ro p e rty th e s u b je c t Fund) of a d d itio n s th e to be Tru ste e s tru sts h e re in a fte r e xp re sse d ■ J NOW T H I S 1. The the p e rio d Tru ste e s c o m m e n c in g te rm in a tin g on of s u rv iv o r the Ln te la s t M a je s ty ye a rs fro m p o rio d th e te rm in a tio n to p e rm it as th e in or the K in g b ra in g UPON T R U S T S E T T L E M E N T W ITN E S S E TH on of th e G eorge b e in g a ll or any of th e in money UPON T R U S T as to c a llin g or c o n v e rs io n any of th e money in v e s tm e n ts of F ifth a ll ( or on in c lu d in g any of th e a fo re s a id h e re in a fte r be as P e rio d " th a n money to in v e s t a u th o ris e d th e H is se ve n ty (s a id and s a id money e i t h e r fo r deem in v e s tm e n ts a ris in g and D a te ” ) in v e s te d d is c re tio n such of d u rin g d e a th of e a rlie r) F ix e d o th e r the liv in g the Fund p re s e n ts e x p ira tio n "th e re m a in Tru st a fte r now A c c u m u la tio n a b s o lu te or th e c a lle d to the 20) y e a r s s h a ll p ro p e rty sam e of of. t h e s e dfescendents "th e or th e ir as execu%£bn tw e n ty h e re in a fte r in v e s tm e n ts in to of c a lle d to co n ve rt d ate fo llo w s :- possessed (w h ic h e v e r as s h a ll sta n d lin e a l th e h e re o f h e re in a fte r Tru ste e s in th e e x p ira tio n d a te d a te s h a ll as fro m sam e ... f it or any in as or lo n g to ‘ s e ll c a ll p ro p e rty such or s a le u p o n #, . ____ 2. THE p u rch a se of s e c u ritie s p e rso n a l or m o va b le any pu rch a se not or Tru ste e s tim e to b e in g cash tim e funds th a t of th in g m ade w ro n g -d o in g he re b y s e c u ritie s or tra d in g in or to im m o va b le p a rt th e or p riv a te as sh a re w h o le th e or of in (w h ic h of of to by or th e to have e x p re s s io n any such or th e lik e n a tu re power to fro m (y e t h o ld to th e , if they w ere in the Tru ste e s by re aso n or of o th e r w ilfu l and in d iv id u a l th e to m a tte r be to lia b le a re a c q u ire even or or . made Tru ste e s and any o m is s io n any sought ‘ s h a ll of though such not of a in v e s tm e n ts or h o ld in g s pu rch a se or or power th e h yp o th e ca te tru st or c o m m o d itie s power s h a ll of s a le fo r such c o n s id e ra tio n Tru st m ay deem a d v i s a b l e or as a n y m is ta k e a re t jruat le a s e p a rt d is trib u tio n who and a sse ts s e ll and type or o p tio n s ca rry p u ts on w h a tso e ve r p ro p e rty th e or sh o rt th e p u rch a se of . and u n r e s t r ic t e d s p e c u la tiv e s u ita b le typ e in co m e p ro p e rty a ris in g fo re g o in g s e c u ritie s e ve ry a d iv e rs ific a tio n s e ll in c lu d in g w ith w ith in v e s tm e n ts may m a r g i n or of h e re o f re aso n fra u d of any ire -in v e s tm e n t or make or Tru ste e s re a so n s itu a te . f it fu ll or le a s e h o ld s e c u rity and sh a re s a re s id e n c e ) , re s p e c ts .a s Fund Tru ste e s p a rt s h a ll o p tio n s by or as p ro d u c in g pow ers may be h i g h l y le g a l Tru ste e s gra n t Tru st re q u ire m e n t co n tra cts a c tiv itie s to th e Tru ste e s w h o le o th e r 3 » >_ _______ T H E and th e and or and p ro d u c in g I th in k sam e re a l P R O V ID E D h o w e v e r t h a t tru sts the use o th e rs a ll e n title d em pow ered o rd in a rily th e in in d iv id u a l p ro p e rty for funds and w h e re e ve r w ith o u t s h a ll th e w h e the r th e re in fo r w h ether in sto ck s a -fre e h o ld in v e s tm e n ts ) Tru ste e s of of w ith .o r have such n a tu re n o n -in c o m e g e n e ra lity any and Fund fa ith th e p a rt the w ith o u t p a rtic u la r s h a ll the and s p e c ific a lly a re c a lls the or o th e r lo s s by not of Fund p ro p e rty w o rld d is c re tio n Tru st good w ilfu l on in v e s tm e n ts in in lim itin g p ro p e rty w h ic h of the in ve stm e n ts and any fa ith except or b e n e fic ia lly fo r in Tru st in te re s t im p ro v e m e n t d iv e rs ify the e x e c u tio n good w ith o u t to Tru ste e s ow n e rs lia b le in such or w h a te ve r c re d it a b s o lu te d u ty th e in ve s tm e n ts made p e rso n a l in v e s tin g p ro fe sse d be no or th e s e c u rity o r u n d iv id e d lia b ility va ry of an yw h e re u n in v e s te d e xte n t a b s o lu te to in v e s t in v e s tm e n ts im m o va b le s itu a te °r upon th e o th e r fra c tio n a l th e ir under or or such in pow ers not in te re s t in v o lv in g upon mAy a p p l y m a in te n a n c e d w e llin g h o u s e w h ether at o p tio n s (in c lu d in g the Tru ste e s or be and and d iv e rs io n s e ll le a s e exchange deemed w h ic h Fund to may at e ith e r on such w h e th e r and no any to tim e p u b lic te rm s fo r th e any c o n s titu te a u c tio n or p u rp o se y m o v a b le in c lu d e c re d it p u rch a se r .. exchange any p ro p e rty a lw a y s at or on any . or s e c u rity of s a le --------------------- - by th e Tru ste e s be co nce rned of th e or p ro p e rty or to in q u ire Tru ste e s 4. tru sts or to of th a t th e th e is see to o th e r of (h e re in a fte r m anner in and th e ir b e fo re w ith o u t b o a p p o in te e o th e r th e c a lle d a b s o lu te F ix e d by any any to of d is p o s e w h ic h th e Tru st so fa r as th e in co m e way a d d in g and as of of th e Tru st Fund fo r and to any in or one such th in k th e f it act of th e Tru ste e s. s h a ll upon sta n d th e fo llo w in g fo r th e such sh a re s at a ify may p ro v id e d the at la w s in of th e th e or Tru ste e s tim e s upon any of pt be such any- p re ju d ic e a p p o in t as Fund and a p p o in t favour may to th e of and ~ Tru ste e s. d is p o s itio n Is la n d s h e ld to on o b je c ts such Cayman to any in -s u c h any B e n e fic ia ry tim e a b e n e fic ia ry to of irre v o c a b le may in c lu d e Tru st th e or (w ith o u t Fund th e as co nfer Tru ste e s may and tim e re v o c a b le a p p o in tm e n t of e x c lu s io n as an a p p o in tm e n t or n o t) a c c re tio n and ' e xte n d to of a c c u m u la te th e by in co m e in v e s tin g in v e s tm e n ts and re s u ltin g th e of the Tru st sam e and th e h e re in b e fo re in co m e as Fund re s u ltin g a u th o ris e d a c c re tio n s to Fund a lw a y s a ll th a t th e Tru ste e s in tim e to tim e in c o m e or c a p ita l at any tim e and or any p a rt of th e m ore sh a re s in Tru st s u b je c t to Seconcf S c h e d u le ' h e r e t o tru sts th e any p o rp e tu itie s of th a t th e is or Tru ste e s e x is te n c e a p p ly or any money p a id th e re o f deeds any p a rt and Tru st P e rio d or such in te re s t in ' a n y or of any and p r o v is io n s a g a in s t w ith th e re o f may p a y A cc u m u la tio n d is c re tio n or (in P ro v id e d the the m th a t w h o le of. t h e s h a ll of Tru ste e s a ll th e e x p re s s ly in co m e com pound v a lid ity d is c re tio n pow ers s u c h .a c c u m u la tio n s d is c re tio n of and Upon T r u s t a p a rt one is sam e m ay n o t (c ) th a n or B e n e fic ia ry the refro m and ru le a cco rd a n ce Fund (b ) th e th e S e ttle m e n t any to in th e in deed it may in any fo re g o in g ) re g a rd s fo r lim ita tio n s AND pow ers w h e th e r the in c o m e tru st th e th e under by pover tru sts and the a p p o in tm e n t d is c re tio n a ry o th e r and u n c o n tro lle d D ate B e n e fic ia ry of o rd e r B e n e fic ia rie s ") such and v a lid as the P e rio d d e s c rib e d "th e such g e n e ra lity J»f a n y a p p lic a tio n upon or Tru ste e s • p e rso n s tra n s g re s s in g th a t the the s a y :- s u b je c t th e p ro p rie ty Upon th e w ith th e or Fund (a ) or to d e a lin g A c c u m u la tio n Tru st to p e rso n in to tra n sfe rre d D U R IN G possessed o th e r as b e n e fit to th e the of th e fro m th e a b s o lu te B e n e fic ia rie s e x c lu s io n Tru ste e s th e ir may of in th e o the r th e ir and or d u rin g if of m ore oth e rs a b s o lu te * the: o t h e r s (d ) Upon an Upon T r i i n t of tho and thn Incom p of th o s h a ll as th e a of p ro v is io n s have or th e upon in in a d d itio n im p lic a tio n be liv in g one in equal s h a ll to or th e h o ld Tru ste e s a p p lic a tio n or in and a b s o lu te a ll th e the the pow ers Tru ste e s th in k in w ill or from any Tru st to by the and may in th e ir Fund and to of u e n e fic ia l uy the o w n e rs g e n e ra lity of of (i) To to Fund e x e rc is e th e ir no te s vo te or asse ts the of the th e . e n u m erated or . p a rtie s such tru sts persons and as th e * T r u s t e e s ‘ e x p re s s ly Tru ste e s a b s o lu te or in s h a ll d is c re tio n ' such m anner and • t d o n a tio n s or tru sts th is Tru st Tru sts by or g ift or o th e rw is e and h e re in p ro v is io n s any p ro p e rty e x e rc is e and as p a rt set of fo r.th and w h o le or th e . h e re o f the such c o n s titu tin g p 'o w e rs w h i c h u e in g (w ith o u t fo llo w in g re s tric te d p re ju d ic e c o m p a n ie s to liq u id a te th e in s p e c ie re sp e ct e v id e n c e tru st or of or tho c o rp o ra tio n th e any the ca rry sh ares or same on any and p u rch ase in or s e c u ritie s o o lig a tio n s c o n c e r n tiw h e t h e r apparent trm t a ny way o th e rw is e in te re s t a s s o c ia tio n s e c u rity Fund or or to in pow ers in c o rp o ra te in th e in d iv id u a l and p o w e r t o or oth e r Tru st any the a sse ts upon a ll w ith o u t in c lu d in g c o rp o ra tio n a ffe c tin g of to p ro m o te bonds p a rt respect w hatsoever To not under fo re g o in g ) ( i i ) nny a d d itio n s tru ste e d is trib u te of sam e u p o n to fo r d e s ira b le tru st as a d d itio n s the m ig h t th e b u s in e s s o th e r oV ' Tru st o ffic e any • V ith th e p erso ns h o ld such ' (b ) or of p ro p e rty to . the tim e them or • a d d itio n a l p ro v is io n s p e rso n a d m in is te r p a rt re c e iv e w ith th e sta tu te to C h a rity . p a rty fit or tim e Ire la n d such In c lu d in g - To of Fund s a id any pe rso n a s m ay seem t o of Tru st la w same f r o m Tru st and . th e ve ste d im m e d ia te ly s tirp e s h e re in b e fo re c o n d itio n s d is c re tio n or by or fo r of per o n n e fit c a p ita l b e in g the p a rtie s by d is c re tio n a ll (a ) th e D a te tho ' of tru st fo rm ed term s a ll th e F ix e d sh a ro s tim q e x e rc is e at s h a ll as th e pow ers if fo r for fo llo w in g e x te n t or Tre a su re r tho such to N a tio n a l a ll to Fund Tru st than o r m ore o f of th e tho h e re u n d e r any on fo r the to Tru st Tru st such th e ir th " the Tru ste e s may be at of G u in n e s s m ore o u trig h t tru sts and may IN th e one e x e rc is a b le 5. if d is c h a rg e any of H enry Fund of e ith e r tru st or by John Any paym ent jUnay b e m a d e Tru ste e s b n ln n c n a fo re s a id good b e n e fit pow ers te rm in a tio n D ate re c e ip ts be w h ic h of Tru st (e ) th e tho F ix e d s u b je c t and to c h ild re n b e fo re th e or s e c u rity s a le or or of. a n y le a s e .■ o f the __ _____ _ — - ( i i i ) To w ith o u t of • p ro x ie s tio w p r th o (iv ) g iv e of Tru sto e s To d is s o lu tio n pow ers mutant.i t u t i o n as th e p a rtic ip a te re o rg a n is a tio n or and any c o rp o ra tio n nny s e c u ritie s or or or le a s e in o th e r v a tin a any in any To become • s e c u ritie s or p ro p o rty re o rg a n is a tio n or w ith (v i) To e x e rc is e o th e r rio h ts or o th e r s im ila r any of or h e ld o ffic e r or e m p lo ye e to fo r and t o use th e Tru ste e s' s e rv ic e s in h o ld b e a re r name in of th e fo rm any name name th e fid u c ia ry (ix ) To To re la tin g in of of th e Is la n d s (c ) s e p a ra te ly or open any common s e rv in g or the and Tru st tru st p e rso n s fo r to or the tin e and to re ta in o th e r * for fo r* p ro p e rty or in C o rp o ra tio n p a rtn e rs h ip • th e • or * w ith o u t b e in o be re m u n e ra tio n or , a D ire c to r or - j in d is c lo s in g and w h o le any or o r s e c u ritle s p a o jL »o f in v e s tm e n ts w ith in or th e and w ith o u t and docum ents p ro p e rty th e s a id re -in v e s t w ith typ e fund and manage o the r funds c o m p a n ie s and w it h o u t m a in ta in e d to or Tru st a c q u ire c o m p ris e d Cayman to tru sts anyone co rp o ra te Fund . e ith e r and r e t a i n in ve s tm e n t n o tic e Dy a n y th e to th e sh a re s w h ether p a rtic ip a te tru ste e To engage the s e rv ic e s of an in v e s tm e n t at a d v is o r any of in tim e a d v is o rs at th e the or ■ ' y Buch and h e re u n d e r (d ) fo llo w and v o tin g Tru ste e s n o m in e e wonds in v e stm e n t c lo s e d the becoae and the v o tin g th e r-e D y to a Tru st re g is te r Fund any any ' in v e s t of of b e in g money in any com pany p a id and p ro te c tiv e s e c u ritie s a p p o in te d th e to go th e r s e c u ritie s the to any > w ith re a s o n a b le name re la tio n s h ip • To the them a d u ly keop s a id of any some o t h e r o m it to in be o e n e fit d e p o s it or one the ( v i ii ) or and of a ffe c tin g d e p o s it or as in t r u s t ', o r s e c u ritie s so change t e x e rc is in g Fund , * h e re u n d e r d e s ig n a te d any Tru st Tru ste e s' To co m m itte e to and . o th e r stru c tu re v o tin g in b u h n lf * h e re u n d e r concur th e (v il) any d e p o s ita ry th e vo te to on liq u id a tio n fin a n c ia l h e ld a tta c h in g p a rt in titlc d or or tru st fo rm in g . a p a rty M a tin g co rp o ra te V (v ) or p ro p e rty- a n d 't o -a n y p ro p e rty w ith or such to m e rg o r or its of a tto rn e y consont c o n s o lid a tio n s a le fo r ow ners in of expense of re co m m e n d a tio n s re c o m m e n d a tio n s may be the of Tru st such h ig h ly Fund a d v is o r and or s p e c u la tiv e w ith o u t a d v is o rs or not lia b ility to e ve n tio u g h of a typ e _ - 1 (e ) v or to such d e te rm in e o o rro w perso n s to oe g e n e r a l 1t y of p ro tio n .o f th e ( f ) in s tru m e n ts or any th o to k in d (g ) a c c o rd in g Tru st of to in co m e c a p ita l re n t is s u e s or tre a t Fund of th e Tru st i s : in c o m e d iv id e n d s d e c la re d and w a s tin g and or to make deem p r o p e r the Tru st pay of and c a p ita l s o ilin g ch a rg e s Tru st from what re n ts such fo r in c o n e any or to or th e is s u e s from of d e te rm in e at what and when or taxes and what tin e c o m p ris e d re c e ip ts w h e th e r or not such at w ere to to sto ck a ccru e d c a p ita l as lia b ilitie s a p p o rtio n th e p a rt p re m iu m e a rn e d or o th e r of a d iv id e n d s in co m e or p a rt ■ in te re s t any m a k in g *©» c h a n g in g vhat b e tw e en th e and c a p ita l and of such of C o u rt p a rt p ro fits out to p e rso ns rig h ts in c lu d in g -'t o r o k e r s ’ c a p ita l th e was p u rc h a s e d tim e the a p p o n tio n p ro p e rty c a p ita l of of d iv id e n d s any and 1 deem p r o p e r in te re s ts is to as a llo c a tio n (h ) p a rtn e rs h ip o etw een of To ca rry jo in t le a s e s co n tra cts p a rt d is c re tio n se p a ra te in c o m e 'g a in s or or Tru ste e s p le d g e stru c tu re s ju ris d ic tio n expenses or o r e t^ ie r • '■ ’ of betw een in v e s tm e n ts and c o m m is s io n s and expenses th e in c o m e of and to . ■ d e te rm in e of deem u n d e rta k in g s Tru st s e a le d o th e r d e te rm in e » .' any in s tru m e n ts re se rve s expenses to any and to g e n e ra lly ch a rg e d or of and fro m le a s in g be a ll th e in s tru m e n ts sto ck or s h a ll lim itin g may m o rtg a g e s c a p ita l e x c h a n g in g and Tru ste e s conveyances th e u n p ro d u c tiv e Tru ste e s in co m e or g e n e ra lly and •£' ' deeds th e rig h ts d e riv e d the to to d iv id e n d s in te re s t p a id w ith o u t b u ild in g w h ic h n o tw ith s ta n d in g rig h ts or le a s e s any in c o n e any th e h yp o th e ca te d e liv e r co n tra cts e re ct as Tru st d is c o u n t and p re ju d ic e th e or or as fro m , lie n s and p r o f i t s is m a rg in o p tio n s in p ro p e rty to re s p e c tiv e in te re s te d te rn s* and O c n e fic la rie s and im p ro v e m e n ts to -th e such pro p e r e xe cu te W ith o u t and the on Fund. m ake rase money and fo re g o in g c re a tin g u n s e a le d make in c lu d in g tra n sg e rs f le n d re a s o n a b le To a s s ig n m e n ts or as p ro fits and o th e r the or e x te n d or or u n d e rta k in g s may s h a ll and and to th e ir n o tw ith s ta n d in g e x te n d in re la tin g in beyond p a rts or sh a re s th e d is trib u tio n s in v e s t c o -o p e ra tiv e Tru ste e s a dva n ta ge ou s s e p a ra te lo s s e s on p a r t ic ip a t e ve n tu re or it funds any e n te r to th e in to such Tru st " Fund u n c o n tro lle d 1h a t s u c h th e c o rp o ra tio n le a s e s te rm in a tio n * co n tra cts of th is . (i ) a c tio n s or Fund any or com pound to To o th e r A d ju s t p ro c e e d in g s p a rt any in s titu te th e re o f dc»bt« o w in g Tru ste e s to co m p ro m is e any m a tto rs *o l hern nt* T n i M t c o a in Tru ste e s upon e v id e n c e tha t in or and upon such p a rt term s p ro p e rtie s fo r re la tin g to w ith Tru st of th e th e h e re o f of of no firm w ith in d e a lin g w ith .a n y agent d e le g a te d Tru ste e s not a ge nt, so e m p lo y m e n t ( l) a p p ro p ria tio n u n fe tte re d Tru ste e s be m a tte rs th e is of such Upon of ahd th e fo rm in g agent fo r Tru st to p a rt an p la c e any th e or money o r c o rp o ra tio n be to act re q u ire d s u b s is tin g fo r th e lo s s not such p a rt on Fund act e x e c u tio n of whose p u rch a se r or p e rm itte d th e reb y to in and of w h e the r th a t or th e fra u d a lth o u g h e x p e d ie n t d is trib u tio n any as or o th e r in q u ire or n e g lig e n c e th e ro f or d e le g a tio n necessary any one tru sts a s c e rta in is o c c a s io n e d v a lu e Tru st no d e fa u lt of any P R O V ID E D h o w e v e r s tric tly any any banker b e in g the under to d e le g a tio n not and and Fund s o lic ito r the p u rp o se th e Tru st of * Tru st«£ u n d way w ith a tto rn e y of any acco rd a n ce in of th e in act e x e c u tio n in or s e t-o ff c o n n e c tio n do any Fund by in or such was Tru ste e s d u tie s b u s in e s s p u rp o rtin g th e of expense paym ent fo r to m a tte r any re s p o n s ib le b e s id e s c o n c e rn in g w h ether s t ill or or and s h a ll and >’ the agent th e w h ic h e m p lo ye d d is c re tio n tim e in a u th o rity s h a ll Tru ste e s' a s s o c ia tio n in c lu d e d the to or e a th e done re c e ip t as deemed d e s i r a b l e any w h ether o th e r tho rn o w ners s a le or at and o th e rw is e w h ic h S e ttle m e n t or and w h e re jo in t by c la im s deem counsel tra n sa c te d the Tru ste e s e ith e r or s u ffic ie n t or or Tru st- a g a in s t of tra n sa ct e x is ts tim e pay o th o r s a le in s u its d iffe re n c e a d v ic e such w o rld or or to fro m the a ll employ a n d case any in to th e seem or any . h e re u n d e r in c lu d in g a th is or counsel a u th o rity of Fund sto ck b ro k e r be (in c lu d in g under th e th e p a rtitio n o p in io n such w h e the r such th o and of as exchange) Fund p a rt d o cu m e nts p e rso n ta ke To to s e c u ritie s of in such o th e rw is e Tru st Tru ste e s re q u ire d make a ris in g (k ) acco u n ta n t to or To any in te re s t e q u a lity d iffe re n c e in any and (j ) agent p riv k te any agreem ent o p in io n or c o -o w n e rs in te re s te d th e a u c tio n of any s h a ll the a re th e Tru ste e s or c la im s w ith h a v in g and or make p a r t i t i o n Tru st any p u b lic the d e b ts te rm s the p ro v is io n to to such to by re la tio n or fo r a d v is a b le or at d efend tho d is p u te s in nnd a ffe c tin g any w h o le p ro se cu te or th e ir a ll th e m in a sse ts th e ir from . a b s o lu te and any fin a l and and such and the upon s p e c ifie d s u b je c t to of B e n e fic ia ry m in o rity w h om h e of or or re s id e s Fund co n tro l of s u b s id ia rie s to and o ve rse e or ta k e Company or any fo r of th a t of or s a id to any or thorn t h o of C la u s e o th e r rig h t to any d u rin g h is w ith w ith o u t lia b ility or d u ty B oard th e s a id have no Com pany 5 h e re o f in te re s ts in u n d e r no th e ‘ . any in a d ju s t pe rso n B e n e fic ia ry of s h a ll to any or to same Tru ste e s the g u a rd ia n Com pany of the necessary fu rth e r or fu rth e r th e d e te rm in e by sh a res to to made d i r e c t l y any its h a re u n d e r e ith e r in c lu d e g iv e s p ro p e r a b s o lu te ly d is trib u te and g e n e ra lity th e of b e n o fit use bo may b o the be p a rt as may bo the to to a ffa irs re p re s e n ta tiv e h is s h a ll and a p p ro p ria tio n and am ou nts Fund ju s t H n n o fic ia rie a or g iv e n seem e x p e n d itu re w h ic h s h a ll a ll a p p o in te d p re ju d ic e s h a ll th e Tru ste e s d u ly its on fa ith B c n e fic ia rie s fo r liv e s be such Tru st h is Tru st the th e to the* o w n e r s h i p to of made W ITH O U T good s h a ll d is c re tio n v a rio u s fo r in s h a ll a p p lie d re s p o n s ib ility the such paym ent th e d is trib u tio n s mado c o n n lu a lv ? any a sse ts th e sh a re s 1l e d d i s c r e t i o n v a lu a tio n b ln d ir p and fu rth e r w h om u n co n tro any of or or a ffa irs of or com pany s u b s id ia rie s * a p p o in t any re s p o n s ib ility management a c irc u m s ta n c e s its to in if to any of its e n q u ire b u s in e s s in to of th e s u b s id ia rie s . * 7 _ IN Tru ste e s s h a ll s u c c e s s io n a firs t a d d itio n esta te ch a rg e a cco rd a n ce P R O V ID K D w ith th e fo r p re ju d ic e cu rre n t m oneys death o th e r th e th e ir Tru st a u th o ris e d tin e m y th e w ith b e in g p ro fit or or th e of d e p o s it the p a id or or o th e r w ith o u t to and may a llo w e d b e in g f ur" t h e r may an by th a t in fo r or the an th e w h ic h Tru ste e s and Tru ste e s may fo r or by th e ir any as w ith o u t re ta in a ll in any in s u ra n c e to w ith o u t may in te re s t advanced account and in of sam e t e r m s cu sto m e r at as tim e on b e h a lf th e m s e lv e s sto ck b ro k e rs to from p a rtic u la r th e and Tru ste e s b u s in e s s upon advance re ta in e d re ta in lia b le p ro b a te as fo rce o rd in a ry and or in any fo re g o in g be e x p e n s e s .th e any tra n sa ct u n d e rta ke made of s e rv ic e s of*T& es account c o n v e n ie n t Tru st th e ir made w i t h th e re b y g e n e ra lity re m u n e ra tio n a ge n ts be (fre e h e re u nder to p ro p e r w h e re s o e v e r p a y a b le Tru ste o s a re account made th e fo r s c a le th e y or thereb y Fund) p u b lis h e d th a t th e ir d u tie s B e n e fic ia ry necessary c o n n e c tio n or of re m u n e ra tio n any fo r to to or th e a c c o u n tin g re in b u rs e m e n t e n title d however Tru st c o n s titu tio n on on w ith tim e w o u ld be to c o m m is s io n c o m p a n ie s p ro fit tra n sa ct b u s in e s s on b e h a lf of th o or p a rtn e rs h ip in or p a rtn e rs a re or firm or Tru st h o ld in g or w h ich nny th e or Tru ste o s w ith o u t b e in g th o Tru ste e s as o ffic e such sh a re s and by such b u s in e s s or not as be any Deed tim e or e x e cu te d in o ffic e oy th e to th e as a fo re s a id o th e r not by th e Is la n d s to be s o le ly and a s may h e re o f tru ste e th e re o f s h a ll re a s o n a b le a g a in s t tru ste e fo r such on any is lia b ility s h a ll be p ro v id e d e ffe c tiv e d is c h a rg e d or W ith o u t b e in g from become th e n ( i ) th e u n fit The ( i i ) The tim e b e in g ( i i i ) any to of The S e ttlo r to th e as to a re s u lt Tru st . Fund re c e iv e d re m o va l is Fund such no re m o va l such s h a ll to th e d is s o lv e d or lia b le lia b le of as as a a fo rm e r or at D e in g pow ers (e ith e r le a s t one in d iv id u a ls c o n ta in e d or or d e s ire s h a ll by in s u b -c la u s e s u b s titu te d to be h e re o f or s h a ll in c a p a b le of a c tin g n a ra o ly :- he s h a ll be dead or u n a b le or act if or th e re p e rso n a l c o n tin u in g be no Tru ste e s s u rv iv in g re p re s e n ta tiv e s of or th e . tru ste e tru ste e s o rig in a l become th e fees o u tg o in g re m o va l pow ers in ' a fo re s a id -u n le s s re m a in tru ste e s be . h e re b y d u tie s as not s h a ll jo in tly who or any s h a ll tru ste e o th e r and w ith the re Fund become and w h e the r jo in tly ve ste d or n e xe cu te d p e rsons Tru st p e rso n may A p p o in to r") Tru sts w h e the r or by th e a fte r tw o s u b s titu te d ) of Tru st tru sts perso n s s u rv iv in g or be if a fte r e sta te there th e re in or any th a t or th e act fo llo w in g u n w illin g ’ or a c c ru in g e m o lu m e n ts e ith e r in d e m n ify in g h e re o f a c o rp o ra tio n a ll in c o rp o ra tio n th e deed or Tru ste e s p re ju d ic e a Tru ste e of "th e e x p e d ie n t u n le s s c o rp o ra tio n or if th e P n 0 V ID £ D _A L S 0 tru st d ie th e re in fo r b e in g if of tra n sfe r a p p o in tm e n t) C la u s e or p ro b a te a new a pe rso n in te re s te d any or may b y pe rso n th e re u p o n d^a th w ith o u t the re fu se to any p a rtn e rs fo r c a lle d ten o u t g o i n g in c o m e (b ) of th a t w ith o f f i c e of T r u s t e e s Tru ste e s become t h e the be b o u n d s e c u rity A p p o in to r or h o w e ve r, may o th e r necessary thereupon or not be s h a re h o ld e rs p ro fit in o rig in a l A p p o in to r any Tru ste e s tru ste e s h a ll tho c o n tin u in g P R O V ID E D (a ) nnd or p a rt Tru st th e ir a p p o in t any s h a ll fo rm (h e re in a fte r or cre a te d w ith fro m Tru ste e s who the Tru ste o s any o ffic e th e (w h e th e r c o n tin u in g p e rso n s to or or c o rp o ra tio n 1 h e re o f rem oved Cayman assu ra n ce ta xe s account fo r s h a re h o ld e rs or any h o ld e rs fin a n c ia lly account c o m p ris e w ith in te re s te d may h o l d than be an in to h o ld e rs S e ttlo r d e liv e re d o ffic e h o ld e rs . bo d e liv e re d re s id e n t to Tru ste e s tim e lia b le w h ic h h e reunder o th e rw is e Tru ste e s lia b le such 5 - - ________i s l - H U S at the s e c u ritie s s h a ll th e m and a re fin a n c ia lly b e in g tho of Tru ste e s o th e rw is e sh a re s b e n e fic ia ry h e re o f fo r th e c o n tin u in g ' Tru ste e s" ” In s t s u rv iv in g la s t Tru ste e upon ro tiro m n n t p e rso n s th e nay at in th e d e s irin g to bo p la c e as (c ) pow ers tin e and oe perso n s A p p o in to r to as (d ) s u D s titu to d ) or of or pow er) th e ono not la s t* tru s te e or m oro D o in g o th o r or in c lu d in g to oe a Tru ste e Tru ste e so deceased re fu s in g s u o -c la u s o o r-b e in g to th e effe ct case The Tru ste e s if (a ) OP T H I S re le a s e d by Tru ste e * and irre v o c a o ly or d is s o lv e d u n fit or b e in g grant th e i m m e d i a t e l y .o r C la u s e a deed the s a id exe cu te d A p p o in to r p ow ers a fte r c o n ta in e d th e to by nay any d e a th of the in lik e p e rso n the ■ may b e . they 30 d a y s w r i t t e n n o tic e p re p a id post to the tim e to tim e a p p o in t upon the day in the nay the such a p p o in t (w h e th e r irre v o c a o ly ta ke th e n a fo re s a id . d e liv e re d re v o c a b ly dood d is c h a rg e d in c a p a u le A p p o in to r or may b y e x e rc is in g Tru ste e s The a c o rp o ra tio n c o rp o ra tio n perso n s any nanner or was h e re o f so d e s ir e of th e ir A p p o in to r in s p e c ifie d or in such of them (w h e th e r re s ig n as Tru ste e s in te n tio n so to do p e rso n as the or w ritin g any such such ro s ig n a tio n n o tic e of o rig in a l h e re u n d e r sent oy oecome re s ig n a tio n a fte r re g is te re d A p p o in to r s h a ll dr may fro m e ffe c tiv e - ‘ » (e ) or in Tru st case In th e re Com pany Tru ste e s the s h a ll L im ite d Upon h e re in b e fo re in w ith c o n n e c tio n (g ) On endorsed p ersons any such re s ig n a tio n tru ste e its of h e re u n d e r su cce sso rs on th e so p e rso n c o n s titu te d of th e e ve ry or named the th e Tru st s h a ll change in and d e a lin g (o r e v id e n c e Tru ste e s the of the the Tru ste e s G u in n e s s become tim e Tru st la te s t of of the Mahon h e re o f Bahamas s u b s titu te d to D e in g by a s h a ll such th a t th e pe rso n s fo r the tim e e n title d to a ll expenses in c u rre d account th is and oe th e s h a ll or oe if th e re in to s ig n e d s h a ll t h i s .-. S e t t 1 e m e n t th e and upon any th a n the oy the p u o lic re ly m ore a re them s ta tin g n o ta rie s e n title d by Tru ste e s a m em orandum m em oranda of of as re c e iv e S e ttle m e n t n o ta ry named o e in g Tru ste e s be tru s te e s h ip a ffix e d the th e fo r the a u th e n tic a te d w ith re m o va l s h a ll Fund S e ttle m e n t fo r or Tru ste e s p e rm a n e n tly Tru ste e s m em orandum s u ffic ie n t re s ig n a tio n p ro v id e d out of the be n o or th e re im b u rs e m e n t nam es of h e re u n d e r (f ) be event one) as fu lly , .... ............ ' __ _______ A n y have s u b s titu te d a ll the pow ers p re se n ts and any c u s to d ia n s of co n ferre d and th e from d is p o s itio n s th e re o f of expense th e of th e TUB T ru s te e s title and of safe co rp o ra te takes tha t tru ste e th e th e d e p o s it safe a p p lic a tio n co rp o ra te o c c a s io n e d 10. IN fees or of the th e S e ttlo r or of d is c re tio n sam e tim e 11 . la w to s h a ll 12 be o the r p a rt bond of re q u ire d T il IS or as of in Tru ste e s or th e of to as these d e p o s ito rie s accept to th e . • s a fe k o e p in g th is and tho th e cu s to d y in bo in any of c o lle c tio n of d ocu m ents and may a t any ch arg es and any a ll oank o a n k in g p a rt of th o w o rld as p a rt of its b u s in e s s w is e them b y fo r re s p o n s ib le such any bank lo s s th e for re m itta n c e any any or of S e ttle m e n t o x p o n s e may i n c l u d e s e c u ritie s hot incom e or to com pany th a t fo r u n d e r­ taut th e b a n k in g w h ic h of u n le s s a lte r of if a s h a ll by so . M is ­ company may b e ' its the fees death » ta xe s to a bond S e ttlo r in th e ■ th e ir out of or refuse d e te rm in e . to th e . Tru ste e s if of may a t and and d u tie s e ls e w h e re any B e n e f ic ia r y th e th e or th e Tru ste e s d u tie s any or o th e r h e re in s h o u ld is be named re q u ire d e ffe c tiv e no by su re ty oond be irre v o c a b le power w h e ther amend on in d e m n ifie d of or Is la n d s the reo f such s u b s titu te d ) on su ch Cayman a g a in s t a w a iv e r o s ta te o th e rw is e be r e q u ir e d th a t and any or such paym ent or th e any p a rt re co u rso th e reo f p roo a te in any p a rt Tru st rig h t to any Fund or s h a ll e xte n t p e rso n of p a rt o rig in a l a ll (w h ic h sto ck D ro k e r w ith o u t any . w a iv e s a u th o ris e d fo r s u D je c t same same or a ll manner the p ro v id e any B e n e fic ia ry Fund NO (w h e th e r be s u b s titu te d sto c k b ro k e r Tru st pay or and o th e r b e c o m in g p a y a o le of th e or the s h a ll event respect Tru st u o m ln o o tt s h a ll and the reb y taxes the th e th e banket o r o k o r a s e c u ritie s cu sto d y tru ste e la w Fund or Tru ste e s s h a ll by s a id upon S e ttle m e n t Tru ste e s s h a ll of th is , Tru st cu s to d y of the Fund s e c u ritie s th e in co m e ) a ll Tru st in s tru c tio n s 9. Tru ste e s or term s a lo n e re vo k e or th is and in th e S e ttlo r c o n ju n c tio n S e ttle m e n t in e x p re s s ly w ith w h o le any or in jp a y 11. by _ T H IS T r u s t e e s them in c o n tra ct 14. the w ith not be p e rs o n a lly a d m in is tra tio n of tho th e W ITH O U T to th a t Tru ste e s of th o ro fu se docum ent any of Tru ste e s p a rtic u la r m a te ria l by upon e x e rc is e th is w h ic h Any of any of of bound th a t is any power any such document or any tru st p e rs o n a lly d o cu m e nts re la tin g co rp o ra te tru ste e in fo rm a tio n or to to p e rm it re la tin g to to th e th e e ve ry of and s h a ll rig h ts p ro v is io n P R O V ID E D the a ll s h a ll th e fo r tha t P e rio d p a rtie s from o n ly fo ru m however A c c u m u la tio n of h e re o f co n stru e d be to and d a te ju ris d ic tio n of and ju ris d ic tio n (o th e r by the of in to Fund la w to any of th e d e c la re d p erso n any s a y :- to ' d e lite ra tio n s the any or manner or th e such m ig h t to w h ic h the. fo r d is c re tio n been e x e ra is e o b ta in e d the co n fe rre d have th e of r.n a so n s co n ferre d a d v ic e in d is c re tio n any re la tin g in s p e c t th e Tru st out th a t any th e on oy th e upon any or th e 1 based or th e copy TRUSTEES of p ro p o se d Tru ste e s Tru ste e s oy at the p rin c ip a l s h a ll not be re la tin g to make bound to MAY P E R M I T t h is , S e ttle m e n t at B e n e fic ia ry a ll Tru st ge neral d is c lo s e the o ffic e to of of of any ANY or any any g iV e 'a n y a ffa irs a n y * -o o p ie s Tru st of e n te rin g to d is c re tio n B e n e fic ia ry s e ttle m e n t and the the made e sta te ) h e re o f any any under d is c lo s in g A N D _ T T _ I S _ T E X P R E S S r rY _ lP n O V ID E ]D B e n e fic ia ry p e rso n s to s h a ll le g a l co n tra ct h e re by power reasons on is or or and s o le ly any as lia b le docu m e n t, i t to d is c lo s in g (n o t- b e in g the any Tru ste e s) such o th e r lo o k of bn Tru st rig h t S e t t 1 omi*•,/j£e^ /■'=✓/'c.\c£X /.<■*-<'* 'n ^ d CL/,r ' U ? v L i-*i£f2 (hereinafter called1'th e Principal”) tU£ /") (-C^-C(jZCf.Sl JyUJc.lLv t i £ i -~ ^.L.sS t J Ijcrebp agrte to pay and satisfy to the Bank on demand all and every the sum and sums o f money which are now or shall at any time be owing to the Bank anywhere on any account whatsoever whether from -the Principal solely or from the Principal jointly with any other person or persons Company or Companies or from any firm in which the Principal may be a partner including the amount of notes or bills discounted or paid and other loans credits or advances made to or for the accommodation or at the request either of the Principal solely or jointly or of any such firm as aforesaid and all moneys for which the Principal may be liable as surety or in any other way whatsoever together with in all the cases aforesaid all interest discount and other Bankers’ charges including legal charges occasioned by or incident to this or any other security held by or offered to the Bank for the same indebtedness or by or to the enforcement of any such security provided always that the total liability ultimately enforceable against us und,er this guarantee shall not exceed the sum o f & pounds together with interest thereon at the rate of two per cent, per annum,above the published Base Rate o f the Bank for the time being_provided tU ff such rate plus the two per cent, be equal t o o r and at all other times at the rate o f fivejper cjflJu^&p-tnTTTunrlV^ the date o f demand by the Bank upon us 2. Wl)i$ Guarantee shall not be considered as satisfied by any intermediate payment or satisfaction o f the whole or any part o f any sum or sums o f money owing as aforesaid but shall be a continuing security and shall extend to cover any sum or sums o f money which shall for the time being constitute the balance due from the Principal to the Bank upon any such account as hereinbefore mentioned 3. HEtjiH) Guarantee shall be binding as a continuing security on us until the expiration o f three calendar months after we shall have given to the Bank notice in writing to discontinue and determine the same 4. 3fn the event o f this Guarantee ceasing from any cause whatsoever to be binding as a continuing security on us the Bank shall be at liberty without thereby affecting their rights hereunder to open a fresh account or accounts and to continue any then existing account with the Principal and no moneys paid from time to time into any such account or accounts by or on behalf o f the Principal and subsequently drawn out by the Principal shall on settlement of any claim in respect of this Guarantee be appropriated towards or have the effect of payment of any part of the moneys due from the Principal at the time of this Guarantee ceasing to be so binding as a continuing security or of the interest thereon unless the person or persons paying in such moneys shall at the time in writing direct the Bank specially to appropriate the same to that purpose 5. !tlnP admission or acknowledgment in writing by the Principal or by any” person authorised by the Principal o f the amount of indebtedness of the Principal to the Bank and any judgment recovered by the Bank against the Principal in respect of such indebtedness shall be binding and conclusive on and against us in all Courts o f Law and elsewhere 6. Cfje Bank shall be at liberty without thereby affecting their rights against us hereunder at any time to determine enlarge or vary any credit to the Principal to vary exchange abstain from perfecting or release any other securities held or to be held by the Bank for or on account of the moneys intended to be hereby secured or any part thereof to renew bills and promissory notes in any manner and to compound with give time for payment to accept compositions (rom and make any other arrangements with the Principal or any obligants on bills notes or other securities held or to be held by the Bank for and on behalf of the Principal 7. Guarantee shall be in addition to and shall not be in any way prejudiced or affected by any collateral or other security now or hereafter held by the Bank for all or any part o f the moneys hereby guaranteed nor shall such collateral or other security or any lien to which the Bank may be otherwise entitled or the liability of any person or persons not parties hereto for all or any part of the moneys hereby secured be in anywise prejudiced or affected by this present Guarantee And the Bank shall have full power at their discretion to give time for payment to or make any other arrangement with any such other person or persons without prejudice to this present Guarantee or any liability hereunder And all moneys received by the Bank from us or the Principal or any person or persons Company or Companies liable to pay the same may be applied by the Bank to any account or item of account or to any transaction to which the same may be applicable 8. iHltljOUCjI) our ultimate liability hereunder cannot exceed the limit herein­ before mentioned yet this present Guarantee shall be construed and take effect as a guarantee o f the whole and every part of the principal moneys and interest owing and to become owing as aforesaid and accordingly we are not to be entitled as against the Bank to any right of proof in the liquidation of the Principal or other right of a surety discharging his liability in respect o f the principal debt unless and until the whole of such principal moneys and interest shall have first been completely discharged and satisfied And further for the purpose of enabling the Bank to sue the Principal or prove in its liquidation for the whole of the moneys owing as aforesaid or to preserve intact the liability of any other party the Bank may at any time place and keep for such time as they may think prudent any moneys received recovered or realised hereunder to and at a separate or suspense account to the credit either of us or of such other person or persons or transaction if any as they shall think fit without any intermediate obligation on the part of the Bank to apply the same or any part thereof in or towards the discharge of the moneys owing as aforesaid or any intermediate right on our part to sue the Principal or prove in its liquidation in competition with or so as to diminish any dividend or other advantage that would or might come to the Bank or to treat the liability of the Principal as diminished 9. BK' have not taken in respect of the liability hereby undertaken by us on behalf of the Principal a n d w e will not take from the Principal either directly or indirectly without the consent of the B a n k any promissory note bill of exchange mortgage— charge or other counter-security whether merely personal or involving a charge on any property whatsoever of the Principal whereby w e or any person claiming through us by endorsement assignment or otherwise would or might on the ' ■ * \ * * ' * ' »* • r • J'* *•' * * . ' « w , > fV-*1 Ir: to the B a n k for the fulfilment of our obligations hereunder and shall be forthwith deposited by us with t h e m for that purpose 10. 3hl addition to all rights of set off conferred by law a n d without prejudice to any lien any m o n e y s n o w or hereafter standing to our credit with the B a n k whether on current or other account shall at the discretion of the B a n k be liable to be set off against our liabilities hereunder « 11. 011 V m o n e y s shall nonetheless be d e e m e d to be so ow i n g by the Principal notwithstanding any defect informality or insufficiency in the borrowing powers of the Principal or in the exercise thereof which might be a defence as between the Principal and the B a n k 12. W ilts Guarantee shall be in addition to and not in substitution for any other Guarantee for the Principal given by us to the B a n k 13. shall have no liability under this Guarantee in respect of m o n e y s owing to the B a n k by the Principal being m o n e y s applied or utilised by the Principal either for any purchase or subscription of our shares (or those of any holding c o m p a n y of ours) or by w a y of financial assistance direct or indirect for the purpose of or in connection with a n y such purchase or subscription 14. % \ )S expression “the B a n k " wherever used herein includes and extends to their successors a n d assigns 15. This Guarantee shall be read and construed in accordance with Englis 3 n W i t n e s s whereof one Director of Guineas and Mahon Limited duly authorised in this behalf (as the Secretary or another Director hereof hereby certifies by his signature hereto) by a Resolution passed by its Board of Directors o n or before the date hereof has hereunto set his hand this Fourth day of June O n e thousand nine hundred and Eighty Two For and on behalf of Guir.ess & Mahon Limit-d Director director or Secretary INTER-OFFICE MEMORANDUM T O: J.D.T. __________ DATE: FROM: J.A.C. 8th November, 1982 SUBJECT : FRANK HALL/BEECH I attach letter to re Debenture financing of Sentinel Vehicles Ltd. At the moment G & M Dublin have guaranteed Midland Bank £35,000 against our counter guarantee. What we would like to do now is that G & M pay the £35,000 to Midland for A/C Sentinel for release of guarantee and remit a further £20,000 to the company's lawyers trust account for Sentinel, and receive back from Sentinel a Debenture for £75,000. We or Frank have already paid £20,000. We will forward to you cash as backing deposit £50,000 and you will treat previous £20,000 as remitted through you to obtain total backing deposit of £75,000. Turn between loan and deposit we have told Frank will be 17«. If you approve I will have Mike S. arrange with Pat 0'Dwyer. I mentioned this proposition to London, Robin Faber, when I was there but that was on basis of guarantee and loan rather than back to back I think. Prefer deal Dublin as I think particularly initially there may be delays in payment. I have told Frank don't expect you to keep chasing the interest payments. Confirm we will make arrangements for interest to be paid quarterly and that the interest rate is to be a fixed rate over G M base. Further we will undertake to repay the loan at any time on request f^pss^ you if it causes Central Bank taxation or other problems. Appendix XV (54) Mr Charles J Haughey 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Charles J Haughey. a) Extract of transcript of evidence given by Mr Conor Haughey to the Inspectors on 19 July 2001. b) Letter of 17 November 1992 - Ansbacher Limited to IIB. c) Letter of 14 September 1992 - Ansbacher Limited to IIB. d) Extract of Moriarty Tribunal of Inquiry dated 22 September 2000 evidence of Charles Haughey. e) Extract of Moriarty Tribunal of Inquiry dated 29 September 2000 evidence of Charles Haughey. f) Letter of 6 September 2001 - Ivor Fitzpatrick & Co Solicitors to the Solicitor to the Inspectors. Correspondence received from or on behalf of Mr Charles Haughey. a) Letter of 13 December 2001 - Ivor Fitzpatrick & Co Solicitors to the Solicitor to the Inspectors. UNDER OATH ON THURSDAY, 19TH JULY 2001 I h e re b y c e r t i f y th e f o llo w in g to be a tru e and a c c u r a t e t r a n s c r i p t o f iny s h o rth a n d n o te s i n th e a b o v e nam ed i n t e r v i e w . 1 8 th N ove m b er 1992 a n d d e b i t e d t o t h e H a m ilt o n R oss 2 d e u ts c h e m a rk c a l l d e p o s i t a c c o u n t 0 4 / 3 9 2 3 1 / 8 1 . 3 I . . . (IN T E R J E C T IO N ). 4 58 Q. we t u r n u p p a g e 25 p e rh a p s we ca n s e e t h a t le t t e r 5 6 7 If 59 A. Yes, Q. Yes. (Same H a n d e d ) th is (E x h ib it 6 )? l e t t e r was s e n t t o me b y t h e T r i b u n a l . Ju st f o r th e re c o rd it 8 "A n s b a c h e r" o f th e 9 I n t e r c o n t in e n t a l Bank s a y in g : is a le tte r 1 7 t h N o ve m b e r 1992 t o fro m Iris h 10 11 " C o u ld y o u p l e a s e a r r a n g e t o l e t me h a ve f o r c o l l e c t i o n an I r i s h Pounds c h e q u e f o r I r £ 1 5 ,0 0 0 p a y a b le t o C o n o r H a u g h e y and d e b i t t h e c o s t t o H a m ilt o n R o ss d e u ts c h e m a rk D e p o s it A c c o u n t 0 4 / 3 9 2 3 1 / 8 1 ." 12 13 14 15 So, 16 17 A. Yes. y o u d i d g e t t h a t £ 1 5 ,0 0 0 ? As I s a y a t t h e t im e I was b u i l d i n g my h o u s e 18 and j u s t in 19 c o m p le t in g i t , 20 some f i n a n c i a l a s s i s t a n c e 21 Now, w h e re I 22 cheque i t 23 60 Q. 24 we h a d m oved i n , my f a t h e r g a v e me f o r b u i l d i n g my h o u s e . c a n ' t e x a c t l y rem em ber t h i s p a r tic u la r may h a v e b e e n p a r t o f t h a t . your b e lie f is th a t th is c h e q u e came v i a your fa th e r? 25 26 So, N o ve m b e r 1992 I was j u s t a b o u t 61 A. Yes. Q. I mean c o u ld y o u be a l i t t l e 27 t h e c ir c u m s t a n c e s ? 28 knew yo u w e re g o i n g t o g e t i t 29 came t o y o u ? m ore e x p l i c i t You know i n d i c a t e about when yo u and how t h e ch e q u e 1 A. I have a c t u a l l y 2 Ir e la n d 3 an y d e p o s it o f t h a t 4 t h a t 's 5 is 6 re c o lle c tio n 7 62 Q. in c h e c k e d w i t h my b a n k , M a la h id e an d t h e r e w hy I s iz e but th a t is So, what i t h a v e no e x a c t o f th e p a r t i c u l a r cheque. I mean l e t u s s u p p o s e f o r a moment t h a t y o u d i d 9 y o u r bank a c c o u n t, 10 h a v e e n d o rs e d i t 11 th a t s o rt? 63 I B a nk o f no r e c o r d o f a r o u n d t h a t t im e . my b e l i e f : r e c e iv e th e cheque and i f 13 is c a n ' t s a y 100% c e r t a i n l y t h a t ' s 8 12 y o u h a v e n o t lo d g e d i t on t o a b u i l d e r o r s o m e th in g o f A. P o s s ib ly . Q. I mean c a n y o u rem em ber t h e c ir c u m s t a n c e s ? D id y o u do t h a t when y o u w e re b u i l d i n g 15 I mean w e re t h e r e d i f f e r e n t w ays o f p a y i n g y o u r 16 b u il d e r o r s u p p lie r s ? A. Yes, p o s s ib ly , 18 a c tu a lly 19 cheque 20 what i t 21 64 22 23 65 24 p o s s ib ly * As I rem em ber t h e d e t a i l s (in d ic a tin g ) (E x h ib it 6) I Q. When t h e c h e q u e came how w o u ld i t A. A g a in , c a n o n l y p re s u m e I I d o n 't know . d id . P o s s ib ly I P o s s i b l y my f a t h e r g a v e i t my f a t h e r ' s 27 I h o n e s t l y d o n ' t re m e m b e r. I see. th a t i t p a r t ic u la r b u t I p re s u m e t h a t ' s A. Q. c a n 't o f th is Do y o u a c c e p t y o u g o t t h e ch e q u e ? 26 29 say I Q. IIB . 66 y o u r house? w as. 25 28 in a s one m ig h t e x p e c t , m ig h t y o u 14 17 L W e ll, s e c r e t a r y gave i t You w i l l n o t i c e h a ve come t o p ic k e d i t t o m e. t o m e. fro m t h i s up i n P o s s ib ly I d o n 't le tte r ha s b e e n d e b i t e d o r c h a r g e d t o you? - (E x h ib it an a c c o u n t 6) 1 c a lle d 2 3 67 H a m ilto n R oss? A. Yes. Q. H a m ilto n 4 w ith 5 fro m th e A. 6 68 Q. 10 69 12 13 70 14 15 71 A. Yes. Q. In A. Yes. Q. And i t A. Yes. Q. So t h a t 17 72 19 20 73 21 22 74 23 24 75 25 26 76 27 28 29 77 th a t I have h e a rd i t m e n t io n e d b u t is . t h is p a r t ic u la r account is d e u t s c h e m a rk ? G erm a n c u r r e n c y ? is re c e iv e d 16 18 see t h a t a s s o c ia te d ' have h e a rd o f i t . You w i l l a c c o u n ts Y o u m ay b e f a m i l i a r w i t h in d iv id u a l? d e n o m in a te d i n 9 11 "A n s b a c h e r” . h a v e no i d e a w h a t i t 7 8 I R o s s was o n e o f t h e account 04/39231/81? e f f e c tiv e ly t h is it w o u ld b e a p p e a r y o u c a s h fro m an "A n s b a c h e r" A. It w o u ld a p p e a r s o . Q- Is th is A. No. Q. T h e n w h o se a c c o u n t i s A. I Q. You h a ve no id e a a t a l l ? A. No. Q. A bout th is ? A. No. Q. None w h a ts o e v e r? A. None w h a ts o e v e r. Q. C a n we p l e a s e t h e n t u r n a c c o u n t? y o u r "A n s b a c h e r" a c c o u n t? it? ha ve no id e a . (E x h ib it 7 )? to p a g e 28 (Same H a n d e d ) 1 2 78 A. ThanJc y o u . Q. T h is is an a n o t h e r l e t t e r fro m 3 th e 4 I n t e r c o n t i n e n t a l B ank s a y i n g : 1 4 th S e p te m b e r 1 9 9 2 . "A n s b a c h e r" o f A g a in , it is to I r i s h 5 6 " C o u l d y o u p le a s e a r r a n g e t o l e t me h a v e f o r c o l l e c t i o n an I r i s h P ounds ch e q u e f o r I r £ l 0 , 0 0 0 p a y a b le t o C o n o r Haughey and d e b it th e s t e r l i n g c o s t t o 'A n s b a c h e r ' L i m i t e d a c c o u n t n o . 0 2 / 0 1 0 8 7 / 8 1 ." 7 8 9 10 11 T h is is 12 th is m on ey, A. 13 I S e p te m b e r 1 9 9 2 . d o n 't . M r. T h is 14 p a r t ic u la r 15 S e p te m b e r 1992? 16 my — 17 79 Q. 18 80 is th e Yes. Q. And i f firs t I 7 ). it th in k you checked y o u r w e re t o b e t h e c a s e t h a t t h i s 22 m ig h t b e i n t e r e s t e d t o 23 tw o c h e q u e s n o t sho w , 24 s h o u ld b o t h t h o s e 25 y o u r b a n k a c c o u n t? As I if . n o t show up i n Yes. (E x h ib it c o u ld c h e c k my b a n k a c c o u n t b u t — d id A. h a v e se e n t h i s d o n 't o ff h a n d b u t I w i l l c h e c k i n 21 26 t im e I (in d ic a tin g ) w o u ld be u s e f u l I A. re c e iv in g H a u g h e y? le tte r b an k a c c o u n t? 19 20 It I Do y o u r e c a l l say t h is ch e q u e y o u r b a n k a c c o u n t w h a t we know i s if th a t w hy s h o u ld t h o s e is t h e c a s e w hy tw o c h e q u e s n o t show u p , was a l s o 27 b u i l d i n g my h o u s e a n d I 28 a g ift 29 o f my h o u s e . fro m my f a t h e r t o t h e t im e I in was c a n o n l y p re s u m e i t was h e l p me w i t h t h e b u i l d i n g € V n& v\ c 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 P.O. Box 887, Grand Cayman, Cayman Islands, British West Indies Telephone: (809) 949-8655 Telex: CP 4305 Facsimile (809) 949-7946 (809) 949-5267 1 7 t h N o ve m b e r, 1992 R o n a n R edm ond, E s q . , C o rp o ra te S e rv ic e s , I r i s h I n t e r c o n t i n e n t a l B ank L i m i t e d , 91 M e r r i o n S q u a r e , D U B L IN 2 . Dear Ronan, . C o u ld y o u p le a s e a r r a n g e t o l e t me h a v e f o r c o l l e c t i o n t o m o rr o w m o r n in g W ednesday 1 8 t h i f p o s s i b l e - a n I r i s h P o un d s ch e q u e f o r IR E 1 5 , 0 0 0 .0 0 p a y a b le t o C o n o r H a u gh e y and d e b i t t h e c o s t t o H a m i lt o n R oss D e u ts c h e M a rk C a l l ‘‘ “ ount N o . 04/39231/81. Y o u rs s in c e r e ly F o r H A M ILTO N ROSS C O . L T D A MEMBER OF THE AMSBACHEX INTERNATIONAL TRUST CROUP OF COMPANIES WITH OFFICES ALSO LOCATED « TO* BAHAMAS. BRITISH VIRGIN ISLANDS. GUERNSEY, MONACOAND SWITZERLAND 4zo s z EkviJUis X A ssb acb er Lim ited Please reply to: 42 FUzwflliam Square, D ublin Z Tel: 765144/763065 F a r 612035 p.O. Bo* U7, Grand Cayon. Caymm Islands, British Wast India* T«l*pboBK (809) 949-1453 Tab* CP 4305 Facsbaito (109) 949-794* (109) 949-S2CT 14th September, 1992. Ronan Redwiond , B aq.r . S S ’i J J i S t S S i t u > » k > M W , 91 M e rrio n S q u a re , DUBLIN 2 . D ear Ronan, g ? i2 JSS«Si*SS2«aSrSS2*zSi oTooS?o^gTy^«*2^SoSoS“HSS9h«sr i n d d e b i t th e S t i r l i n g c o a t t o Anabacher X ,i* ite d A ccount N o .02/010 8 7 / S I. Yo u rs s i n c e r e l y , pka r AWSBACHER LXWXTBD JDT/AJW TRIBUNAL o f in q u ir y (PAYMENTS TO MESSRS CHARLES HAUGHEY AND MICHAEL LOWRY) A p p o in te d b y in s tru m e n t o f An Ta o is e a ch d a te d 2 6 th day o f Septem ber 1997 p u rs u a n t to th e T r ib u n a ls o f In q u ir y (E v id e n c e ) A c ts 1921 and 1979 TRANSCRIPT OF PROCEEDINGS HELD IN DUBLIN CAB T U I pfepQRE'MR. JU S TIC E MICHAEL MORIABTlir (CHAIRMAN) , ON FRIDAY, 31ST OCTOBER 1&97. AND BXaLXjCWXNg"5MfS; TRANSCRIPT OF PROCEEDINGS ON FR ID AY. 22ND SEPTEMBER 2000; I hereby certify the followinB to be a true and accurate transcript of my shorthand notes in the ebove named proceedings. Tel___ 8722833 Fax..........8724486 After Hours_2882087 E-mail: doyleaos@iniiigo.ie COPYRIGHT Transcripts are the work of the shorthand writer and they must not be photocopied or reproduced in any manner or supplied or loaned by an appellant to a respondent or to any other party without written permission of the shorthand writer. 1 evidence to be given. But I do not accept that it is not, 2 to some degree, part of counsel's function to invite a view 3 on particular facts or the construction that may be put on 4 it, but I accept that the primary thrust of the matter is 5 factual. 6 from some controlled and limited degree of inviting a view 7 from your client on particular matters that may be of 8 considerable importance. However, I am not going to inhibit Mr. Coughlan 9 10 MR. GARDINER: Thank you, Chairman. MR. COUGHLAN: Now, Mr. Haughey, I think we were dealing 11 12 Q. 13 with that it is known, it is a fact, that Mr. Traynor 14 approached a certain number of people and asked for money 15 on your behalf; isn't that correct? 16 A. Yes. 17 Q. And if it be found as a fact that this, the 450,000 going ■ 18 into this account, did not arise by way of a loan, but was 19 sourced from other people, I am asking you does it not 20 appear to you at this stage to be likely that Mr. Traynor 21 solicited or asked for money on your behalf and didn't ask 22 for a loan? 23 A. I cannot say. 24 Q. Why can't you say? 25 A. Because I have no knowledge of what Mr. Traynor may have . 26 done or not done at that time or what his approach may have 27 been. 28 volition. 29 30 Q. It was — Very good. that was something that he did of his own Now, this relates to Term of Reference (a), Mr. Haughey, as to whether any payments — I'll use the 1 term payments to include benefits and matters of that 2 nature — 3 a reasonable inference that the motive for making the 4 payment was connected with the public office held by you or 5 had the potential to influence the discharge of such 6 office. 7 — 8 evidence with any questions of favours or acts done or 9 anything of that nature. were made to you in circumstances giving rise to You understand that that was why X am asking you I am not dealing at this period in the Tribunal's It's monies which may have been 10 given to you or solicited on your behalf in circumstances 11 giving rise to the inference that they are connected with 12 the holding of public office. 13 am coming from in asking these questions now? 14 A. Do you understand where I I am just thinking as you are talking to me, Mr. Coughlan, 15 that you seem to draw a conclusion that if Mr. Traynor 16 approached somebody on my behalf, it had necessarily to be 17 . by way of donation, and you mentioned a few cases. I am 18 just recalling that — I think we will be coming later to 19 an incident with Mr. P V 20 was a case o f .borrowing. 21 66 Q. Dcyle, I think in that case, it On the face of it, yes, that would appear to be the case on 22 the face of it. 23 from Doyles about that, that there was never anything — 24 A. 25 26 But there was evidence given by people So that Mr. Traynor's approach, therefore, could be both. It could be sometimes pure donation, sometimes borrowing. 67 Q. In the case of Mr. P V Doyle, a loan was raised in Guinness 27 and Mahon guaranteed by Mr. Doyle, effectively guaranteed 28 by Mr. Doyle. 29 was a loan in Guinness and Mahon. 30 Mr. Doyle. That was the way it was done there. MORIARTY TRIBUNAL - MbdK/AP It It wasn't a loan from 1 2 68 A. I think, in effect, it was. Q. Well, we'll come to that in due course and how it was dealt 3 with by Mr. Traynor at the end, of course. 4 . 5 Now, of course, that loan was never paid back. 6 7 69 A. I am not aware of that. Q. I see. * was done by way of a donation or by way of a loan, can I 9 ask you this, did you ever payback any loan of 450,000 or part thereof, to your recollection? 11 A. I wouldn't pay it back. 12 ' ~~ ■ ■ r ■ ■ m 13 70 Q. A. Well, where would the money have come from to do that? Well, I have mentioned to you already that my accountant is 15 of the opinion that there were later borrowings which might 16 have been used to repay borrowings at this point, the point 17 we cure dealing with, from Guinness and Mahon. 18 71 Q. That is borrowings which took place in Cayman, isn't that 19 correct, in the sum of 400-odd-thousand pounds? 20 come to that as well. 21 accountant now, isn't that correct, looking back at the 22 situation? 23 A. And I'll But that is speculation b y your Yes, but you asked me specifically was any money — was any 24 money ever paid to Guinness and Mahon arising — 25 Guinness and Mahon out of borrowings on this occasion. 26 am only saying to you, from m y own point of view, that I am 27 aware that there is that possibility. 28 than that. 29 m If it were to be paid back, it would be paid back by Mr. Traynor on my behalf. 14 m So if it 8 10 W Well, we'll come to it in due course. 30 72 Q. repaid to I I make it no more We will examine that in detail in due course, in fairness to you, Mr. Haughey. But on the evidence, which, of course Appendii v-w? i TRIBUNAL OF INQUIRY (PAYMENTS TO MESSRS CHARLES HAUOHEY AMD MICHAEL LCWKY) Appointed by instrunant of An Taoiseach dated 26th day of September 1997 pursuant to the Tribunals of Inquiry (Evidence) Acts 1921 and 1979 TRANSCRIPT OF PROCEEDINOS HgUD IN DUBLIN CASTLE maTORE~MR. JUSTICE MICHAEL MORIARTY (CHAIRMANTT ON FRIDAY, 31ST OCTOBER 1997. AND FOLLOWING DAYS: TRANSCRIPT OF PRQrnnvnxNGS ON FRIDAY, 29TH SEPTEMBER 2000: COPYRIGHT Transcripts are the work of the shorthand writer and they must not be photocopied or reproduced in any manner or supplied or ioaned by an appellant to a respondent or to any other party without written permission of the shorthand writer. Halpin, who was an authorised officer of the Central Bank, and he gave evidence on day 28, the 9th July 1999. Yes, I see that. Now, Mr. Halpin informed the Tribunal that by letter dated 8th December 1982 addressed to the Manager Exchange Control, you requested Exchange Control permission to borrow on behalf of Abbeville Stud, the Sterling equivalent of 400,000 from Guinness Mahon Cayman Trust Limited. Interest was expressed to be payable half yearly at 1% over the cost of three month funds and full repayment of principal was due on the 31st January 1985. So if I could just ask you to deal with document number 112 at that divider, please, and it is a letter — the address is Abbeville Stud, Abbeville, Kinsealy, County Dublin. It's addressed to the Manager Exchange Control, Central Bank of Ireland, Dublin 2. It reads — 8th December 1982. "Dear sir, I wish to make application on behalf of Abbeville Stud for permission to borrow Sterling. The details are as follows: "1. The bank: Guinness Mahon Cayman Trust Limited, PO box, 887, Grand Cayman, British West Indies. "2. The amount: The Sterling equivalent of 400,000 Irish. ” 3. The purpose: Primarily development and commercial MORIARTY TRIBUNAL - MMK/AP "4. Draw-down in amounts of 100,000 between the 1st January 1983 and the 31st January 1983. "5. Repayment: "6. Interest: Full amount on the 31st January 1985. Interest payable half-yearly will be at 1% over the cost of the three-month funds. "7. Security: Joint and several guarantees of C J Haughey and Maureen Haughey.” » And over the page: » "The title deeds of stud will be deposited with Mars Nominees Limited, 17, College Green, on behalf of Guinness Mahon Cayman Trust Limited and an undertaking given to formalise the security should this be required. "I am enclosing herewith an extra copy of this letter for your convenience. "Yours faithfully, Charles J Haughey.” And would you agree that was signed by you, Mr. Haughey? Yes. Now, do you remember, first of all, making an application to the Central Bank for exchange control approval? I am not sure that I do, but now that I see this letter V I I 1 here in front of me, I accept that that's my letter and 2 that I made that application. 3 135 Q. 4 in Sterling? 5 No. A. 6 * « K * I would be very clear that that letter would be drafted by Mr. Traynor and given to me to sign. 7 136 c V « « « I c Now, do you remember looking for 400,000 or the equivalent Q. Yes, I accept that it must have been drafted b y somebody 8 who was familiar in how to put an application before the 9 Central Bank the way i t ’ s set out. But did you have any 10 discussion or can you remember having any discussion with 11 Mr. Traynor about applying to the Central Bank for Exchange 12 Control approval? 13 A. I d on’ t remember any discussion, but I would, if you put it 14 to me, I will accept that I must have had — 15 had a discussion with Mr. Traynor about it. 16 137 Q. I must have Perhaps I can assist you in that Mr. Halpin, in his 17 evidence, said that Mr. Des Traynor personally delivered 18 your letter in duplicate to Mr. Bernard Breen who was then 19 the General Manager of the bank. 20 or — 21 A. No. Would you remember that . But as I say, I would be fairly definite, looking 22 back, that the procedure would have been that Des Traynor 23 would have drafted the letter, brought it out to me to 24 sign, perhaps, or arranged for me to sign it, and then he 25 would have taken it from there. 26 transaction from then on. 27 138 28 29 3° Q. • He would have handled the Now, at the time this application was made, I think you were still Taoiseach? A. Well, it was the time of in and out, but if you say I was Taoiseach, I'll accept that. 1 A. 2 158 Q. No, I don't remember it. Now, the next matter in the documents is document number 3 114, and it's a letter from Mr. Traynor to Mr. Donovan at 4 the Central Bank and i t ’ s dated the 22nd January 1985, and 5 it reads: 6 . 7 "Dear Michael, attached hereto are copies of the following: 8 . 9 "1. Letters of the 8th December 1982 from C J Haughey to 10 the Central Bank. 11 . 12 "2. 13 . 14 "3. 15 1985. 16 . 17 "I will be grateful if, at your convenience, you could let 18 me have approval and also approval for the payment of 19 interest of 68,000 to bring the facility to the revised 20 figure. 21 . 22 "Yours sincerely, J D Traynor." 23 . 24 And if you go to the next document, document 115, it's a 25 letter from Guinness Mahon Cayman Trust and it's signed by 26 Mr. John Furze, Managing Director, and it's dated 22nd 27 January 1985, and it's addressed to you, at Abbeville Stud, 28 ’ Letter of the 9th December from Bernard to me. Two copies of John Furze letter of the 2nd January . Abbeville, Kinsealy, County Dublin, Ireland. 29 . 30 "Dear sir, re loan extension - 2 years - It reads: Sterling 1 £350,000. We wish to refer to our recent telephone 2 discussion in connection with the extension of present 3 facility. 4 350,000 Sterling on the following terms and conditions. We confirm that we are prepared to extend 5 6 "Amount: Sterling £350,000. 7 31st December 1984. Repayment in full by the 8 9 10 "Interest: Payable quarterly at 1% over the cost of 90-day funds. 11 12 "Security: We will continue to retain the joint and 13 several guarantee of Charles J Haughey and Maureen Haughey. 14 These guarantees will continue to be supported by the title 15 deeds presently held. 16 17 "We should be grateful if you would: ' 18 19 "1. 20 yourself and your wife. Have a copy of this facility letter signed b y both 21 22 "2. Arrange for the Central Bank of Ireland approval to 23 be stamped on the copy of this letter. 24 25 "Having had the above documentation completed, we should be 26 grateful if you would hand them to Des Traynor for onward 27 transmission to us. 28 29 "Yours faithfully, John A Furze." 30 MORIARTY TRIBUNAL - bMK/AP 1 There then is on this particular document, a signature, 2 Charles J Haughey and Maureen Haughey. 3 that that is yours and Mrs. Haughey's signature? 4 A. 5 159 Q. Yes. And then there is stamped the approval of the Central Bank 6 7 8 160 on the document. A. Yes. Q. Now, you must have signed that particular document, isn't 9 10 that correct, yourself.and Mrs. Haughey? A. 11 161 I did, yes. Q. 12 13 And it was addressed to you at Abbeville; isn't that correct? A. 14 162 15 Yes. Q. A. And can we take it it must have arrived at Abbeville? I beg your pardon? 16 163 17 Can we take it Q. A. It must have arrived at Abbeville. Oh yes, I suppose so, yes. Well, there is a possibility 18 that he may have, Mr. Furze, may have made it out to me, 19 sent it to Des Traynor, who may have passed it on to me, 20 but — 21 164 Q. Well, do you remember receiving it? This was effectively 22 a rolling over of the loan, extending the period of the 23 loan. 24 A. 25 165 26 27 166 Yes. Q. A. Q. Do you remember receiving it? . Well, I must, because I signed it. And do you remember that you were dealing with the Managing 28 Director, that you must have had a telephone conversation 29 with a Mr. Furze, who was the banking Director of Guinness 30 Mahon Cayman Trust? i a B I i 2 "Permission is hereby granted for the extension to the 31st 3 December 1988 of Sterling £350,000 borrowing b y Mr. c J 4 Haughey from Mr. Guinness Mahon Cayman Trust. 5 in Mr. John Furze's letter ... permission is also granted 6 for the payment of Sterling £95,613.58 in respect of 7 interest on the borrowings to the 31st December 1986. As detailed 8 "Yours sincerely, Mr. Halpin," on behalf of the Central 9 Bank." 10 C 11 l I l l l 12 Now, those are the documents available to the Tribunal in 13 respect of what I would describe as the Cayman loan. Now, 14 I think you have what appears to be the Cayman loan — I 15 think you have now furnished to the Tribunal a consent or 16 an authorization to allow the Tribunal to take this matter 17 up on the Cayman side; isn't that correct? 18 Yes. 19 191 Now, do you yourself ever remember Mr. Traynor telling you 20 that the money had come in from Cayman, that it had been 21 drawn-down? 22 ■ i i ■ i 23 192 A. Q. 24 25 26 193 27 28 194 No, do you yourself ever remember Mr. Traynor ever telling you that such a loan was ever paid back? A. Q. A. Q. 29 30 I think I have already told you no. Pardon? Ever paid back, to the best of your knowledge? No. And to the best of your knowledge, there was no demand ever made on you for the repayment of this loan, was there? A. No, you mean by — 1 195 2 QA. 3 196 By Cayman or anyone here? No. Q. And to the best of your knowledge, your title deeds for 4 Abbeville and the stud still remain under your control and 5 possession? 6 A. A m I definite about that, Mr. Coughlan? 7 assistance here. We — 8 be handed to Mars Nominees Limited. 9 197 10 Q. A. Q. A. Q. A. Very good. 15 them to Mars Nominees Limited. 16 have given them to Mr. Traynor or perhaps — 17 complicated — 19 Q. A. 20 201 If it did arise, Z would it's instructed John S O'Connor & Co to — I understand that, that — So that's — Q. Whilst you mightn't have formally lodged them with Mars 21 Nominees, they were there if Mr. Traynor made a call upon 22 them? 23 A. I don't recall ever doing anything of that nature. 24 202 m Yes. The only thing is that I mightn’ t necessarily have given 18 200 M Yes. And I think m y reply was that I didn't. 13 199 14 it was suggested that they would And you asked me if I did that. 11 198 12 I am asking your Q. Very good. 25 . 26 Now, Mr. Traynor had left Guinness and Mahon in 1986; isn't 27 that correct? 28 A. 29 203 Q. 30 If that's the date, yes, I'll accept that. And the Tribunal, from its analysis of the various accounts held in your name or by Mr. Traynor or accounts used by - • I V O R F I T Z P A T R I C K &. C O . SOLICITORS 44 - 45 ST. STEPHEN’S GREEN, D U BLIN 2. TELEPHONE: +353 1 678 7000 FAX: +353 1 678 7004 DX 53 DUBLIN. E-MAIL: info@ivorfitzpatrick.ie website: www.ivorfitzpatrick.ie Mary Cummins, Solicitor to the Inspectors, Third Floor, Trident House, Blackrock, Co. Dublin. FAX 2833929 6th September 2001 Our ref Your ref Direct Fax liji 7 Re: : DC/LMCA_AG3813 : : 661 3555 ® .&> Our client: Mr. Charles J Haughey Dear Sirs, Further to your recent query in respect o f this matter our client has confirmed that his evidence to the Moriarty Tribunal can be relied upon by the inspectors as evidence in the course o f their investigation. Yours faithfully, IVOR FITZPATRICK & CO. Jennifer Blunden, Deirdre Courtney, Ivor Fitzpatrick, Cormac Gordon, John King, Mary-Ctalre Markey, Bernard McEvoy, Michael J. O'Connor, Margaret Scully, Susan R. Stapleton. John Burke, Karen Hickey Dwyer, Susan Fenton, Ita Guilfoyle, Edel Kirley, Loma McAuliffe, Marqaret McGlnley. Dympna Murphy, Ortaith O'Brien, Milan Schuster. IV O R F IT Z P A T R IC K & C O . SOLICITORS 44 - 45 ST. ST EP H EN ’S G R EEN , D U B L IN 2. T ELEPH O N E +?53 1 678 7000 FAX: +353 I 678 7004 D X 53 D U BLIN . E-M AIL: info@ivorfiupatrick.ie STRICTLY PRIVATE A N D CONFIDENTIAL M ar y Cummins, Solicitor to the Inspectors, Third Floor, indent Mouse, Blackrock, C o Dublin. web'iile; www.ivorfitzpatrick.ie 13 D ec e m b e r 2001 O u r ref Y o u r ref Direct Fax : DC_MGE1691 : : 661 3555 B y Fax: 2833929 Re: O u r client: M r Charles J H a u g h e y Dear Sirs, W?: refer to your letter of the 23rd N o v e m b e r in relation to the above. S*JGGESTED A M E N D M E N T S i/n tinge 1 of your Preliminary Conclusions at the end of the 2Tid paragraph w e would suggest d x Allowing be added:• :,& as conducted in private by way o f his evidence being taken on commission. This svitience was subsequently read into the p ub lic record and form s p art o f the evidence before the T rib u n al ” A twin on page 1 of your Preliminary Conclusions at the end of the 3rd paragraph the last sentence could be> "T k is conclusion was assisted by the acceptance by hint that evidence given by him to the Tribunal o f In q u iry could be availed o f by the Inspectors fo r the purposes o f their inq uiry in determ ining M r. H aughey’s involvem ent with G M C T subsequently known as A&shacher”. O n page 2 the first sentence ’ "has submitted “should be “ agreed”. O-s page 2 the 3rd paragraph “The Moriarty Tribunal”should bec o me “ No evidence has been adduced as to whether or not the loan has ever been repaid :::■■ . .cirdreCourtnev, IvorFitzpatrick.Comae Goroon, John King,Mary-ClaireMarkey, Barnard MtEvoy,MichaelJ.O'Connor. Margaret Scully,Su«n R.Stapleton jchr*)Byijk-,Kur^n Hicksy Dwyer, Susan Fenton, ftd(Jufifoyle,EctelKirley.Lorna McAuliffc, Mar<)JretMcdiniey. Dympna Murphy, QrldithQ'8rienfMilanSchuster. Oil page 2 in the next paragraph w e would suggest adding after “the loan documented above” -.tie following “although this is not com pletely cle a r ” , in. the next paragraph w e would suggest ‘ W j at that tim e a person with loan account approval from G M C T subsequently renam ed Ansbacher Lim ited .” in the next paragraph w e would suggest “ having arrived at the conclusion that M r H aughey ••-••'-••v person with loan account approval from G M C T subsequently renam ed Ansbacher Lim ited” . ,• v/ould also suggest that the paragraph should finish with the sentence “ better le ft to the Tribunal o f Inq uiry*’ and that the remaining words in that paragraph should be deleted. /: respect of the Inspectors Preliminary Conclusions w e would suggest that the words should that “M r Haughey’ was at one tim e a person with loan account approval from G M C T subsequently named Ansbacher Lim ited” vV£; w o u ld also suggesr that the last two sentences are not necessary and the report should end v iih “ the inspectors base th eir conclusion on the evidence o f M r Haughey as outlined SUBMISSION Th- balance of the evidence referred to does not allow for a definitive conclusion as set out in your preliminary conclusions. 1L is clear that Mr. Conor H a u g h e y received the two amounts from the accounts from which iiicy were drawn. Equally if they were received by hi m they m a y have gone to financing his bui Iding costs and if so they m a y have been give to h i m by his father. H o w e v e r in the absence of account n a m e details they do not conclusively support without further evidence the conclusion that Mr. H a ug h ey w a s a client of Ansbacher - particularly where ‘ ‘ client”is undefined. w ould appear that these cheques originated through Mr. Traynor and therefore it would be M r Traynor w h o would be the “client”. w e would equally add that the evidence given by Conor H a u g h e y is not necessary to your ^elusions and cannot be relied upon to support your finding on the loan account evidence. ■>ur cheat has always categorically rejected any suggestion or conclusion that he is anything other than a person with loan account approval from G M C T and as such has always rejected a conclusion that he was a client of Ansbacher Limited. W e await hearing from you in relation to the above. Yours faithfully, i V O R F I T Z P A T R I C K & CO, -! I I V O R F I T Z P A T R I C K & C O. T H E H IG H C O U R T IN THE MATTER OF THE COM PANIES A C TS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES A C T 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R A A e p o r t ppo inte d ffairs of of to A t h e E In s p e c t o r s n q u i r e n s b a c h e r L into (Ca t h e y m a n ) imited Published by Order o f the Court made on 24 June 2002 V o lu m e [7 ]: A p p e n d ix X V (5 5 ) t o X V (7 3 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (55) Mr Gerald Hickey 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Gerald Hickey. a) Transcript of evidence of M r Gerald Hickey dated 25 M a y 2000. b) Statement and attachments of M r Gerald Hickey dated 19 M a y 2000. c) Undated Guinness and M a h o n m e m o headed ‘ Gerry Hickey’ . d) Receipt of share certificate of 28 M a y 1993. e) Ansbacher C a ym an Limited statement of current a/c of 24 June 1996. f) Telefax of 22 September 1994 - J A Furze to IIB. g) Extract from meeting of Board of Directors of Guinness and M a h o n of 28 November 1974. h) Extract of Guinness and M a h o n credit committee minutes of 4 November 1971. i) Letter of 16 November 1971 - Guinness and M a h o n to Gerald Hickey. UNDER OATH ON THURSDAY, 25TH MAY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: M R . ROWAN FCA MS. MACKEY BL Interviewee: MR. GERALD HICKEY Represented by: MR. BRIAN BOHAN I WITNESS EXAMINATION PAGE MR. G. HICKEY MS. MACKEY 7 - MR. ROWAN 1 2 3 4 MR. ROWAN: 5 Good morning, Mr. Hickey. My name is Paul Rowan. 6 fellow inspector is Noreen Mackey. 7 interview today. 8 Tribunal. 9 MR. HICKEY: Yes. MR. ROWAN: If you wish to consult 10 11 My This is an It is not a Court and it is not a with your legal advisor, 12 if your ask us to stop we will allow you to speak to 13 him. 14 MR. HICKEY: I see, yes. 15 M R . ROWAN: Equally, Mr. Bohan, if you 16 wish to make a point to 17 your client, if you ask us to stop we will allow you 18 to do that. 19 M R . BOHAN: Yes . 20 MR. HICKEY: This is not a Tribunal. 21 I thought it was a 22 Tribunal? 23 MS. MACKEY: No. 24 M R . ROWAN: No. 25 M R . BOHAN: It is an inquiry. 26 M R . ROWAN: It is just an 27 28 29 investigation. MR. HICKEY: I see, yes. 1 maintaining a transcript 2 of this. 3 afterwards and you will be asked to sign it. 4 MR. HICKEY: Yes. 5 MR. ROWAN: What we tend to do -- and It will be converted into written form 6 it may well be appropriate 7 in this case -- is that if you feel you would like 8 to stop because you are not feeling well, would you 9 please let us know and we will arrange to have a 10 break. 11 MR. HICKEY: Thank you. 12 M R . ROWAN: In any event we tend to 13 have a break after about 14 an hour. 15 MR. HICKEY: I see. 16 M R . ROWAN: We will take it at your 17 18 speed. MR. HICKEY: 19 20 very much. M R . ROWAN: 21 the oath please. 23 MR. HICKEY: 25 26 27 28 29 Thank you That is fine. I would like to ask Ms. Mackey to administer 22 24 Right so. Right. 1 2 3 4 1 Q. MS. MACKEY: 5 Mr. Hickey, I will start by asking you some 6 questions and Mr. Rowan will take up then at a later 7 stage? 8 A. 9 2 Q. Yes. We sent you, as Mr. Rowan said, our long letter 10 asking you various questions. 11 back your unsworn statement 12 A. 13 3 Q. And you have sent us (Exhibit 1)? That is right, yes. You have sent us with that some documents. And you 14 have given us certain explanations or references to 15 those documents? 16 A. 17 4 Q. Yes. Before I begin to ask you questions proper about 18 your own background and your own relationship with 19 Guinness & Mahon, I want to ask you about these 20 documents that you gave us? 21 A. 22 5 Q. Yes. Are these the actual documents you got from 23 Guinness & Mahon or is it some kind of summary of 24 them? 25 A. No. What happened was this: About a year and a 26 half ago was the first time that 27 Guinness & Mahon sent me some of the documents when 28 I was asked to appear before the Moriarty Tribunal. 29 6 Q. Yes? 1 2 7 Q 3 A 4 8 Q Yes ? It is that one and that one. (INDICATING). All of these set out at C to K, these look as if 5 they are some sort of summarised version of 6 documents 7 A 8 Yes. (Exhibit 1)? But I would to say that I have never seen the first one apart from this one. 9 9 Q 10 A 11 10 Q 12 A 13 Yes ? The first one "A" I have never seen. And that one. Yes ? I have never seen any of these until a few weeks ago. 14 11 Q 15 A 16 12 Q 17 A 18 13 Q 19 A 20 14 Q 21 Where did this come from? Guinness & Mahon sent them to me. In that form? Yes, in that form. Because one of them here "I" simply says 9/4/84? "I" in this lot here? "I" in that lot there, yes. It simply says: "9/4/84, a letter from Gerard Hickey to College Trustees in which he confirmed that College Trustees Ltd..." 22 23 24 Did they send you that letter, Mr. Hickey? 25 A 26 15 Q 27 I have no recollection whatever. No, with these documents. Is this all they sent you? 28 A 29 16 Q That is all they sent me, yes. 1 2 17 Q Right. It would be important for us to actually see 3 these documents themselves. 4 send them to you...(INTERJECTION)? 5 A 6 7 But did they not send them to you? 18 Q No. They have sent us a general category of but they haven't specifically sent us these? A I am not even certain if they have a copy of that 10 because... 11 about College Trustees? 12 I thought they sent you everything they possibly could. 8 9 So since they didn't 19 Q Do you want me to explain just a little Not yet, no, we will come to that. I was really 13 concerned to know whether this was a summary that 14 you had prepared of documents that had been given? 15 A 16 20 Q 17 A 18 21 Q No, this is what I was sent. This is what they sent you? Yes . That is fine, thank you. Can I just ask you first 19 of all for a brief history of your own career. 20 were a solicitor until your retirement? 21 A 22 Yes. 1948. 23 22 Q 24 A 25 23 Q I am 73 years of age now. You I qualified in I am therefore over 50 years a solicitor. Yes . Do you mean my general career? If I ask you a couple of pointed questions. 26 You were with the firm of Hickey Beauchamp first of 27 all it was Hickey & O'Reilly. 28 1974 with two other firms and became Hickey 29 Beauchamp Kirwan & O'Reilly? We had a merger in 1 24 Q. 2 3 4 5 And did you continue in private practice all during those 50 years? A. 25 Q . A. No, not at all. My father retired in 1962. Yes. We did, as Brian can confirm, a very big litigation 6 practice. 7 companies for the defendants. 8 26 Q. 9 A. 10 27 Q. 11 A. My father did it for the insurance Yes? I had to take over my father's share of that. Yes? I did that for about 12 years to 1974. 12 we had the merger. 13 of the partnership. 14 28 Q. 15 A. 16 29 Q. 17 A. And in 1974 At that date I became chairman Chairman? Of the partnership. Yes? I retired from full-time practice. I still did some 18 work and indeed some of this work. But I was 19 retired at that stage from full-time practice. 20 I then became a director of a couple of the major 21 companies. 22 and...(INTERJECTION). 23 30 Q. 24 I was involved in business So you diversified into business really at that stage? 25 A. 26 31 Q. 27 Yes. Could we say from 1974 on that your interests were more in business than in practice? 28 A. 29 32 Q. Yes. I think that is probably right. You continued some private practice? 50/50 anyway. 1 2 33 Q 3 A I retired completely in 1989 I think it was. I mean 4 I hadn't been in any way active for perhaps four or 5 five years. 6 34 Q 7 8 So you retired both from business and from some form of practice? A 9 No, I retired from the practice in 1989. And then of course I was fired from the two major businesses 10 when I was 65. 11 35 Q 12 A Under the Articles you have to go. Could you tell me what those two business were? They were CRH, which of course has given rise to 13 some of this and New Ireland Assurance was the other 14 one . 15 36 Q 16 A 17 37 Q 18 And you were a director of both of those companies? Yes. And Des Traynor was Chairman of both of them. That is right. You retired from both of those at the age of 65? 19 A 20 38 Q 21 A 22 39 Q 23 A 24 40 Q That is right. And that was when? 1992 . 1992? Yes . I think that is fine for the career. 25 If we could look at your statement, Mr. Hickey 26 (Exhibit 1)? 27 A 28 41 Q 29 Yes, certainly. You talk in your statement about Guinness & Mahon. What I would like to know first of it all is, when 1 did you first develop a business relationship with 2 Guinness & Mahon? 3 A. 4 Des Traynor and I both became directors of New Ireland Assurance in 1971 I think it was. 5 42 Q. 6 A. 7 43 Q. 8 A. 9 44 Q. 10 A. Yes? And of course obviously got to know each other. Yes. You had never met him before? I had never met him before then, no. Yes? That was the time when you could set-off all bank 11 interest against your income for tax irrespective of 12 anything. 13 45 Q. 14 A. Yes? And of course an awful lot of businesses in the 15 professional end of the city were in fact doing 16 that. 17 18 46 Q . A. Yes? They were paying interest to the bank and 19 speculating with what they borrowed from the bank 20 instead of paying tax. 21 that is what was being done. 22 47 Q. 23 A. 24 48 Q. 25 A. 26 49 Q. 27 A. 28 29 Yes? Of course there was a lot of property speculation. Yes? I acted as solicitor for New Ireland Assurance. You were a solicitor for New Ireland? Yes. all. 50 Q. Maybe it was all wrong but Right? But that really has nothing to do with this at 1 But that gave Traynor information on my performance 2 and apparently he thought that I could be relied on 3 to work efficiently. 4 Guinness & Mahon. 5 51 Q 6 A 7 52 Q 8 So I began to do business for As a solicitor? As a solicitor, yes. I was a solicitor. What I am really interested in at this point is when you began to become a client of Guinness & Mahon? 9 A 10 53 Q 11 A 12 I wish I knew exactly when, but I don't. Yes ? Because there was so much speculation going on. And I did some myself. 13 54 Q 14 A Yes? But when exactly I started, I don't know. You see, 15 this document they sent me here, they don't know 16 what that date is. 17 55 Q 18 A Yes ? They said Cathal McCarthy, the law agent of 19 Irish Permanent. 20 him? 21 56 Q 22 A 23 57 Q 24 A I am sure you have come across Yes? He said he thought it was 1971 but he didn't know. You are referring to which particular document? To A1 (Exhibit 1). As you can see there he said he 25 didn't know what they were. 26 That "1971" is my writing if it is on your copy. 27 think it was probably around about then 28 because...(INTERJECTION). 29 Would that mean, Mr. Hickey, that you were in a 12 And then I wrote 1971. I 1 client relationship with Guinness & Mahon before you 2 met Des Traynor in 1974? 3 Yes up to a point. 4 59 Q 5 A So you did know Guinness & Mahon before that? William Forwood and Traynor were sent forward from 6 England to become joint managing directors with 7 Guinness & Mahon. 8 60 Q 9 A I think it was in 1969. Yes? I am sorry, I was incorrect, I did know Traynor a 10 short time before we both went on the board of 11 New Ireland. 12 61 Q 13 A So how did you first come to know him then? Because of the fact that New Ireland were looking 14 for directors. 15 died. 16 this merger at the time going on between 17 Irish Cement and Roadstone. 18 62 Q 19 A 20 63 Q 21 A 22 Somebody had died. I forget who had One of the O'Reillys had died and there was Yes ? Which later became CRH. Yes? And I had some involvement in that. I am terribly sorry, I did meet Traynor a bit before 1971. 23 64 Q 24 A 25 65 Q You met Traynor before 1971? Yes but only casually. Yes. Would you have begun around that time to borrow from Guinness & Mahon? 26 27 A 28 66 Q 29 A Yes . To finance your...(INTERJECTION)? 1 67 Q 2 A I was a client for several deals. But I would like 3 to emphasise -- I don't know if this is the right 4 moment to bring in what I think these are? 5 68 Q We can go through them when we come to those. We will look at those. 6 7 A 8 69 Q 9 Yes . This is just general background at this stage, Mr. Hickey? 10 A 11 70 Q 12 A 13 71 Q 14 A 15 72 Q I am sorry, I did know him before. You knew him before? Yes . You knew him from around the late 1960's? About 1969, yes. In your statement here (Exhibit 1) -- and this may 16 lead you on to looking at the documents -- 17 at 18 paragraph two that you have no files or records save 19 in respect of one matter which happened 22 years 20 ago? 21 A 22 73 Q you say Yes . 24 You say: "I learned much later, about two years ago, that I was liable to capital gains tax on the distribution of funds on the liquidation of the company." 25 Would you just tell me about that. 26 company that was liquidated? 27 The company that was liquidated was a company called 28 Clonmel Estates Ltd which bought property at the 29 bottom of Abbey Street opposite to where the VHI is 23 What was the 1 now which was the old Brookes Thomas's. 2 warehouse sites there. 3 7 4 Q. 4 A. 5 It was for Had you an interest in this company? I had a one-third interest in that. That is what this was about. 6 75 Q. 7 A. 8 76 Q. 9 A. 10 77 Q. 11 A. Yes. So you were a shareholder? I was a one-third shareholder, yes. Were you also a director? I was also a director, yes. So this company was liquidated? This company was liquidated long since. You see 12 what happened was, the original intention was to do 13 a major development. 14 78 Q. 15 A. Yes? The times were bad; interest rates were too high. 16 We couldn't get the finance to develop it so we just 17 held on to it in hope. 18 about 1978 that Irish Life wanted to build their 19 enormous new offices down there and that they were 20 interested in the site. 21 79 Q. 22 A. Anyway, then we got word in Yes? So we had some discussion with them and they made us 23 an offer which yielded us a profit of about 24 £210,000. 25 8 0 Q. 26 A. Right. We were happy to take that and get out. What 27 happened then was, the company was liquidated. 28 There was nothing in it but cash. 29 there wasn't any point in going to the expense of We decided that 1 appointing an accountant to liquidate it, which 2 would be the normal thing to do. 3 liquidator and I simply distributed the cash. 4 81 Q. 5 A. 6 82 Q. 7 A. 8 83 Q. 9 A. 10 84 Q. 12 A. They were foreigners. All of them were foreigners? Yes. Do you have their names? I don't know where I stand. 85 Q. 15 Of yours? Yes, they weren't resident here for tax purposes or This is really for information. Perhaps you can give us their names? A. I think I am not supposed to because I was acting as 17 their solicitor. 18 their names. 19 86 Q. 20 A. 21 I am not supposed to disclose Were they also directors? No, they were not. There names don't appear anywhere. 22 87 Q. 23 A. 24 I see? Because they didn't want their names to appear anywhere. 25 88 Q. 26 A. I see? The only person whose name was allowed to appear was 27 mine. 28 solicitor. 29 First of all they were any other purpose. 13 16 Who were the other shareholders? clients. 11 14 I was appointed 89 Q. I was acting as their agent as well as So you were a one-third shareholder in a company in 1 2 Was it just two? 3 They weren't actual shareholders, they were sleeping 4 partners if you like. 5 90 Q 6 A 7 91 Q 8 A 9 10 They didn't officially appear. But they were the beneficial owners? They were the beneficial owners. 92 Q On the documents who appeared as the nominee holding those shares? A I think there were some nominees in our office. 13 I forget where. 14 people...(INTERJECTION). 15 93 Q 16 17 But they weren't The shareholders appearing on the title are nominees out of your office? A 18 19 They were beneficially entitled to two thirds. 11 12 Yes ? I think so. But these people themselves certainly didn't appear. 94 Q I see. Maybe we will come back to that. 20 The company was liguidated and you distributed the 21 profits ? 22 A 23 95 Q 24 Yes . In relation to your own share, you then go on to 26 tell us here at paragraph three that your share was: "Placed on deposit with Guinness & Mahon and I always understood that it was so." I would like to ask you about that placing on 27 deposit? 25 28 29 A Yes . First of all, how did it arise that you came to 17 1 2 A. 3 97 Q. 4 5 A. Is this one of the documents It is not with the A, B, C I have given. I think we made a mistake and left it out of this list. 7 98 Q. 8 A. 9 99 Q. 10 A. 11 Are you giving us a copy of this now? If you wish. I am sure you have it somewhere. Actually, yes, we do have that document. There is no date on it, but it was sometime in 1978 (Exhibit 2). 100 Q. 13 14 Which one is that. that you have provided to us? 6 12 You see, you have this document I presume? I am sure I have it. It is page 49. Yes, Mr. Hickey, we do have it. A. What happened was, there was nothing in the company but cash. 15 16 101 Q. 17 A. Yes? Its debts and all the rest of it had been paid and 18 all expenses. 19 for myself and paid the other people. 20 102 Q. 21 A. 22 103 Q. So I simply wrote cheques for a third Yes? No, I am sorry, I paid it into Guinness & Mahon. Yes. That is what I want to ask you about. When 23 you say you paid it into Guinness & Mahon, did you 24 open an account in your name at that stage? 25 A. 26 104 Q. 27 No, I didn't. This is what I want to find out, what exactly happened. 28 A. 29 105 Q. Did you give this cheque to Mr. Traynor? Yes, as I did many others. Right. Did you discuss first of all with 1 Mr. Traynor what was going to happen to this 2 one-third share? 3 A. 4 106 Q. 6 A. 7 107 Q. Yes because as I said there, I wanted it 18 to What did he say to you when you asked him to do that? A. 11 12 You wanted the money on short-term deposit? 24 months later for another...(INTERJECTION). 9 10 I told him I wanted it on short-term deposit. 5 8 I did, yes. I don't know whether I dealt with him. I dealt with a fella called Ru Leonard, who is dead. 108 Q. For the moment I just want your own recollection, 13 leaving the document aside, of what actually 14 happened. 15 about what you would do with this sum? 16 A. 17 I am not even certain if I talked to himself. It was probably Ru Leonard. 18 109 Q. 19 A. 20 110 Q. 21 You spoke to Ru Leonard? Yes. And you said you had a sum of money you wanted to place on short-term deposit? 22 A. 23 111 Q. 24 A. 25 112 Q. 26 Yes. They knew about this; they partly financed it. They had financed what? They partly financed the purchase of the lands . I see, yes. So they were aware then that the company had been liquidated? 27 A. 28 113 Q. 29 You talked to Mr. Traynor or to somebody Yes, they knew all about that. Yes. Then you said to them that you would like to 1 2 3 114 Q 4 A 5 115 Q A 8 9 Just leaving that aside. 116 Q They didn't suggest anything to me. A 12 117 Q 13 They said to you 'Yes, we will place it on Yes . Did they say it was going to be on deposit in Ireland? A 15 No. I assumed myself that it probably would be because I wanted it quickly. 16 118 Q 17 A You assumed it would be on deposit in Ireland? Yes. But I mean, I didn't say that. 18 as if I was wrong. 19 recently (Exhibit 2). 119 Q 21 22 I just assumed deposit.'? 11 20 It is your memory I am it was on deposit. 10 14 You see, I haven't seen this. interested in? 6 7 What did they suggest to you then as a deposit? Yes. And it looks I have never seen this until Is this cheque that is referred to in this £70,214.29 your share? A Yes. You see, I had paid the whole lot into 23 Guinness & Mahon, all the money. 24 document which I think has an indication of that. 25 It is document B (Exhibit 3). 26 120 Q 27 A There is another Yes . You see it refers there to £211,000 opposite my 28 name. The only thing I can assume -- again it is an 29 assumption. I am not swearing it; I just can't -­ 20 1 is that that was my share plus the other two 2 shares. 3 bottom, U3 and U4, I really don't know what they 4 are . 5 Where are you talking about U3 and U4? 6 A You will see these other accounts at the At the bottom of this. You see taking off certain 7 expenses -- and Guinness & Mahon may have had some 8 share themselves, 9 total was £210,000. 10 122 Q 11 A 12 13 123 Q I am sorry, £220,000, three £70,000's. That I think Let me just get this clear: You put the total amount on deposit with Guinness & Mahon? 15 A 16 124 Q 17 A 18 125 Q 19 A 20 126 Q 21 A 22 I paid the total amount to Guinness & Mahon. To Guinness & Mahon? Yes . Guinness & Mahon in Dublin? Yes . To whom did you pay that? I don't know which individual. I dealt with a lot of individuals. 127 Q 24 Would you have given that cheque to Mr. Traynor himself? 25 A 26 128 Q 27 A 28 29 That was the total? is the £211,000 that I paid into them there. 14 23 Yes. I am not quite certain now -- the I didn't always deal with him. I know that, but on this occasion? I don't remember, I think probably Ru Leonard actually because he arranged that. 129 Q When you paid that whole sum to Guinness & Mahon, it 21 1 2 It was to do whatever the other people wanted them 3 to do and to put my share on deposit. 4 130 Q 5 So the other people were also clients of Guinness & Mahon? 6 A 7 131 Q Yes . So when you gave that money to Guinness & Mahon, it 8 was put into an account in whose name. 9 you got documents back from them showing that this 10 11 was on deposit? A 12 132 Q 14 A 15 133 Q A 134 Q The entire sum, that wasn't put into a collective No, I don't think so, I think it was separated. Let me get this clear: You said a few minutes ago that you distributed the funds? A 23 24 I didn't really; I didn't know what happened to the I think my money was put on deposit. 21 22 So you didn't know what had happened? account? 19 20 Guinness & Mahon never gave me other shares. 17 18 No, I didn't. documents. 13 16 I presume I distributed them in the sense that I split them up. 135 Q But now you say you gave the whole amount to 25 Guinness & Mahon? 26 Yes. 27 wrong. 28 what the divide was. 29 Guinness & Mahon. I think maybe you are catching me slightly What I did was, I told Guinness & Mahon The money always went into All these monies always, the 1 2 136 Q 3 A Right? And I told them what the divide was and then they 4 put my share on deposit. 5 my affair. 6 137 Q The other shares weren't So you gave that sum to Guinness & Mahon and you 7 said to them 'This is to be divided up into three 8 thirds'? 9 A 10 138 Q 11 A 12 13 Yes . And in regard to your own share? I didn't say anything to them, they knew about all of that. 139 Q But they must have had to take instructions, Mr. 14 Hickey, from somebody. 15 bank and let them do what they like. 16 them some instruction? 17 A 18 You don't hand money to a You must give I am afraid I cannot entirely agree with you there. Mr. Traynor did things...(INTERJECTION). 19 140 Q 20 A Was Mr. Traynor involved in this? Of course he was, he knew all about it. He didn't 21 necessarily handle the details but he knew all about 22 it . 23 141 Q 24 A 25 142 Q 26 27 He knew about everything that went on. But how did he know about this. Was he one of the partners in this, one of the shareholders? A No, I don't think so, although he was in some others as far as I know. 28 29 How did he know all about it? 143 Q Right. Were Guinness & Mahon themselves 23 1 2 They put up some of the money. 3 the money as far as I remember. 4 144 Q 5 A AIB put up some of Yes ? And I think Guinness & Mahon may have taken some 6 commission. 7 they may have taken some commission, which may 8 account for that slight discrepancy. 9 145 Q 10 A They weren't actually shareholders but I see . Then I should say to you what happened was, when the 11 distribution was made I didn't realise that this was 12 a distribution in technical terms and that I was 13 liable for tax as a distribution on the liquidation 14 of the company. 15 22 years later. 16 report to the Revenue that tax was paid on my share. 17 146 Q That is what was pointed out to me That is when I asked Brian to I am sorry to keep harping back on this but I think 18 it is important that we get it clearly in our minds 19 so as to explain what subsequently happened and what 20 exactly happened here. 21 you have told me already? 22 A 23 147 Q 24 A 25 148 Q If I can just summarise what Yes of course. If I am wrong you will tell me? Yes . On the liquidation of this company, Clonmel Estates, 26 you and unnamed shareholders were entitled to the 27 funds in the company in the form of cash? 28 A 29 149 Q That is right, yes. 1 2 150 Q. 3 A. 4 151 Q. 5 A. 7 152 Q. I think so, yes. That amounted to that. You were entitled to That is right, yes. You didn't hire an accountant to do the distribution? 8 9 A. 10 153 Q. 11 No. This was the mistake we made at the time. You were the person who undertook to divide up the funds ? A. 13 14 Was that the entire of the sum? one-third of that? 6 12 Yes. There was nothing except cash. All I had to do was send the cash to Guinness & Mahon. 154 Q. 15 Yes. So you sent the entire sum to Guinness & Mahon? 16 A. 17 155 Q. 18 Yes. With no instructions other than what they were to do with your share? 19 A. 20 156 Q. 21 Yes, that is right. The only instructions you gave Guinness & Mahon was in relation to your own share? 22 A. 23 157 Q. 24 A. No, I don't. 25 158 Q. None at all? 26 A. 27 159 Q. 28 A. 29 160 Q. Yes. Do you have documents in relation to all of that? No. What would have happened to all of those documents? What would have happened to them? Yes. I mean if you had documents at the time? 1 2 161 Q. 3 A. 4 5 There would have been a file with the firm of solicitors which is long since gone. 162 Q. 6 7 You didn't keep documents? In Hickey Beauchamp in Hickey Beauchamp there would have been a file, yes? 163 Q. And you don't think if we enquired from 8 Hickey Beauchamp now that there would be any copies 9 of that? 10 A. 11 164 Q. 12 I have enquired and there isn't. To get back to what happened, you gave this entire sum in a cheque or a draft? 13 A. 14 165 Q. 15 A. Yes. To somebody in Guinness & Mahon? Yes. To Guinness & Mahon and I probably said to Ru 16 'This is what you have been expecting.' 17 it was coming. 18 166 Q. 19 A. 21 167 Q. 22 That is right. With regard to the two-third balance, you gave them no instruction? 23 A. 24 168 Q. 25 No, it wasn't for me. I understand that. I had no authority. How did they know what to do with that? 26 A. 27 169 Q. 29 With that you gave an instruction as to what was happening to your share, which was £70,215? 20 28 They knew Because they knew. But from whom would they get instructions. couldn't just act on their own behalf? They 1 2 170 Q 3 4 You were acting on behalf of the other two shareholders there. A But I didn't give them any instructions. 5 simply put it all on deposit. 6 did. 7 171 Q They just That is what they I am trying to clarify what your role was here 8 vis-a-vis the other shareholders because the other 9 shareholders were trusting you to look after this 10 11 money? A 12 172 Q 14 A 15 173 Q 16 Yes. With no indication as to who it was for? No. Were Guinness & Mahon aware of who the beneficial owners of this money were? A 18 I don't think they were actually. 174 Q 20 A Just put it on deposit. 21 175 Q For who; in whose name? 22 A 23 176 Q 24 A 25 29 So what were they to do with the money then? All in my name initially anyway. All in your name? Yes because they didn't know who the other people were . 177 Q 27 28 They may have been but I don't think they were. 19 26 That was all I was to do. 13 17 Yes but it was to send it to Guinness & Mahon. That is what I am getting at. So this entire sum was put on deposit in your name? A I don't know, honestly, I don't know. probably was but I just don't know. I think it 1 178 Q. 2 A. 3 179 Q. 5 A. 6 180 Q. 7 A. 9 181 Q. 10 A. 11 182 Q. 12 A. 183 Q. 16 A. 17 What about the rest? For the other there was no There was no term on it? No. But it was to sit there. And to whom was Was it to you? To me because the other people as I said to you were They were not resident here. Yes? They were not resident here either for tax or for any other purpose. 184 Q. 19 I understand. The information in relation to their share of this deposit was to be given to you? 20 A. 21 185 Q. 22 A. 23 Yes. So you would get statements from the bank? If any were required at all. These people didn't take any notice of the thing for years. 186 Q. 25 Yes. But you were acting as you said as their solicitor? 26 A. 27 187 Q. 29 Mine for a short-term. foreigners. 15 28 That was to be put on deposit then for a short-term? information to be given about it. 14 24 That is particular...(INTERJECTION). 8 18 I think it is that £216,000's there. what I think it is. 4 13 Right. Yes. You were the person that dealt with it, if there was anything to deal with? 1 188 Q. In other words, if these people wanted to know what 2 the state of their deposit was they would contact 3 you? 4 A. 5 18 9 Q. 6 A. 7 190 Q. And you would contact Guinness & Mahon? That is right, yes. And Guinness & Mahon would tell you and you would relay information back to them? 8 9 A. 10 191 Q. 11 A. 12 192 Q. 13 14 They would, yes. Yes. So you were the person? But they didn't come near me for years. Yes. When they eventually came near you then, was it to withdraw all that money or to just find out? A. What happened was, as far as I know, after 15 Des Traynor died in 1994 an awful lot of people 16 withdrew money from the Cayman accounts. 17 193 Q. 18 A. 19 Yes? And I think this money was simply repatriated to Europe. 20 194 Q. 21 A. 22 195 Q. 23 It certainly never came back here. This money was in a Cayman account? I think it was, yes. And you knew it was there during that period. This is the other people we are talking about? 24 A. 25 196 Q. I suppose I did. I didn't take much notice of it. The statements that you were getting, was it 26 Mr. Traynor himself who would give you occasional 27 statements ? 28 A. 29 197 Q. No, he never dealt with details like that. Who would give you the statements? 1 Some of the other officials. 2 of them. 3 198 Q 4 A 5 199 Q 6 A 7 200 Q 8 A 9 10 There was a whole load There were a half a dozen officials there. Normally who would you contact? There was Leonard. There was Lannigan O'Keeffe. Yes ? I cannot think of their names. They were the ones you would contact? Yes. Traynor himself you only contacted if there was some major crisis. 201 Q This money -- the other two-thirds of this money -­ 11 was in a Cayman Island account, an account in the 12 name of Ansbacher in Cayman? 13 A 14 15 As far as I knew. 1978. 202 Q 16 But don't forget, this started in There was no such thing as Ansbacher then. No, at that stage it was called Guinness Mahon Cayman Trust Ltd. 17 A 18 203 Q That is where I believe he put it. Yes. What you were aware of at that stage is that 19 it was in an account with a subsidiary of 20 Guinness & Mahon called Guinness & Mahon Cayman 21 Trust Ltd ? 22 A 23 204 Q 24 A 25 205 Q That is right, as far as I know. In the Cayman Islands? That's right. And it was earning interest there. And it was earning interest there. In relation to 26 your own share of it, did you understand that it was 27 also in Guinness Mahon Cayman? 28 29 A I was not certain of that. The reason I say that is because I told them that it was short-term. 1 206 Q 2 A 3 That I wanted the money for another speculation, which I did. 4 207 Q 5 A Yes ? I withdrew it. The other was the Dolphin, which I 6 will explain to you later. 7 in 1980 and I withdrew that money about 1980. 8 208 Q 9 A 10 209 Q 11 A 12 210 Q 13 A 14 211 Q We started the Dolphin Yes? I didn't withdraw it in the form of a backing loan. Yes ? I simply withdrew it. You withdrew it? I just withdrew the cash. In relation to that cash, it now appears it was on a 15 short-term deposit with Guinness Mahon Cayman Trust 16 Ltd? 17 A 18 212 Q 19 A 20 213 Q 21 A Yes . It was earning no doubt interest during that period? It was, yes. Can I ask you, did you declare that interest? Yes. As I say in the statement here, every year I 22 insisted that Guinness & Mahon give me the usual 23 statement that we all have to get from our bank. 24 214 Q 25 A Yes ? For interest paid for the year to 5th April, and 26 every year Guinness & Mahon issued those interest 27 statements to me. 28 29 215 Q Did those statements that Guinness & Mahon gave to you cover a deposit in Guinness Mahon Cayman Trust 1 2 A. 3 216 Q. I presume they paid them. I think it wasn't their habit because that would 4 have been a separate statement that would have come 5 from Guinness Mahon Cayman Trust Ltd? 6 A. I do not think it worked that way. 7 me a statement. 8 and I didn't know which was which. 9 transactions. 10 217 Q. 11 Right. They simply gave You see, there were other deposits It was all other The other deposits for which they would give you statements, were they deposits here in Ireland? 12 A. 13 218 Q. Yes. As far as you knew what you were declaring to the 14 Revenue Commissioners was interest earned on 15 deposits here in Ireland? 16 A. 17 18 Guinness & Mahon. 219 Q. 19 20 No, I was simply declaring what I was given from Yes. But you were not specifically aware that that might have included overseas deposits? A. I don't know guite honestly. I am not certain 21 whether I was aware at that stage or not. 22 I think I probably was actually but I am not 23 certain. 24 220 Q. 25 A. 26 221 Q. You are not certain? No. In relation to that whole episode of 27 Clonmel Estates, was Stokes Kennedy Crowley involved 28 in advising on that at that time? 29 1 accounts for us. 2 stage. 3 222 Q 4 A Honestly I don't remember at this Yes . They certainly were involved in some of the other 5 matters. 6 time. 7 had thought that there was anything not right about 8 this, I presume they would have raised it with me. 9 But they didn't. 10 223 Q Yes. Of course they did my accounts all the They got certificates of interest. If they What we can agree on now is that the entire 11 proceeds of this Clonmel Estates or the entire money 12 that was available on liquidation was in an account 13 in what is now Ansbacher Cayman, what was then 14 Guinness Mahon Cayman Trust? 15 A 16 224 Q 17 I think that is probably correct, yes. Yours was in maybe a separate account in the same name on a short-term deposit? 18 A 19 225 Q 20 A 21 226 Q 22 A 23 227 Q Yes . It appears from the document? I am not certain but I think it was. And interest accrued on those accounts? Interest would have accrued. As far as you knew, your evidence now is that that 24 interest was included in the statements of interest 25 given to you by Guinness & Mahon? 26 A 27 228 Q 28 A 29 229 Q Yes because I wasn't certain where my account was. You weren't sure? And I had told them it was short-term. 1 2 No, I didn't. 3 230 Q 4 A 5 231 Q You didn't? No. Were you ever advised by Des Traynor or anybody from 6 Stokes Kennedy Crowley to set up a discretionary 7 trust overseas? 8 A 9 But there were various discussions about various things. 10 And there is a reference here to the Gerald Hickey trust 11 232 Q 12 A (Exhibit 4). I will come to that in a moment? Quite frankly what that is about I don't know. I never knew about that. 13 14 No, I never did. 233 Q Did you ever have a meeting with Mr. Traynor and 15 Mr. Reed of Stokes Kennedy Crowley in which there 16 was talk of setting up a discretionary fund? 17 A 18 19 things. 234 Q It was almost his alter ego. Did they suggest to you at one stage that you set up a discretionary fund? 20 21 Yes, I did, and I was involved in it and all these A 22 I think they did. But you see, I had nothing in particular to put into it. 23 235 Q 24 A 25 Yes ? I was simply dealing here and taking in effect short-term profits and short-term losses also. 26 236 Q 27 A Yes? Then I wasn't really dealing offshore at all in that 28 sense. 29 here and used that for speculation here. And I borrowed money from Guinness & Mahon 1 237 Q Can you recollect the conversation that you had with 2 Mr. Traynor and Mr. Reid in which it was suggested 3 that you might set up a discretionary fund? 4 A It wasn't just me, it was a general suggestion about 5 trust for a number of people. 6 different people involved at that stage. 7 238 Q A 10 11 Were all those people present at this particular meeting? 8 9 There were various I don't know. They wouldn't all have been present. I honestly do not know. 239 Q The situation is that you were at a meeting with 12 Mr. Traynor and Mr. Reid at which a couple of other 13 people at least would have been present? 14 A 15 16 things. 240 Q 17 18 Yes but I was at many meetings with them about other No, this is a meeting about a discussion about discretionary trusts? A 19 It may have occurred in the course of one of the other meetings. 20 241 Q 21 A 22 242 Q 23 I see. You cannot remember? I can't honestly remember. Yes. But is your evidence that you never in fact took up the suggestion of establishing a trust. 24 A 25 243 Q 26 A 27 244 Q No, I never set up a trust in Cayman. Or in the Channel Islands? No, I had no trust. So the references then in the documents that we have 28 here to the Gerald Hickey trust, you say you don't 29 know what that is? 1 I just do not know what that is. 2 later. 3 245 Q 4 A 5 6 They are very much Yes ? Yes, it was earlier 1974 Gerald Hickey Trust. In 1974 it certainly wasn't Cayman I think. 246 Q Have you the document there that is headed 7 "Gerald Hickey Trust share certificates." Are we 8 looking at the same one. 9 of our brief (Exhibit 5)? 10 A 11 247 Q No, share certificate, I am referring to page 41 I haven't got that one. We will give one to you, Mr. Hickey (same handed) 12 Mr. Hickey, this is a document that we got from 13 Guinness & Mahon. 14 "Gerald Hickey Trust share certificate number three 15 dated 21st February covering 9998 shares in 16 Crane Holdings in the name of Nifold Investments 17 Jersey Ltd." 18 It is headed: It say: "I confirm having received the above share certificate from Guinness & Mahon Ltd, College Green, Dublin 2." 19 20 21 It is signed Gerald Hickey on 28th May 1993. 22 Is that your signature, Mr. Hickey? 23 A 24 248 Q 25 A 26 27 Do you recollect signing this thing in 1993? No, I don't quite frankly. thing failed. 249 Q 28 29 That is my signature. A This was the Dolphin development. We will come to that. yet. Don't forget, this whole We haven't talked about that 1 250 Q. 2 I just want to look at this document a bit more closely. 3 A. 4 251 Q. It is headed Gerald Hickey Trust? Yes. And it talks about a share certificate covering 5 shares in Crane Holdings in the name 6 of...(INTERJECTION)? 7 A. 8 companies. 9 252 Q. 10 A. 11 I want to ask you what they were? Yes. Crane Holdings was the company that owned the Dolphin Hotel. 12 253 Q. 13 A. 14 254 Q. 15 A. 16 Crane Holdings owned the Dolphin Hotel? Yes, in the first instance. Right. And then it was subsequently transferred to a company called Nemean. 17 255 Q. 18 A. 19 256 Q. 20 A. 21 257 Q. 22 A. 23 258 Q. 24 A. 25 259 Q. Yes. Can we just talk about Crane Holdings first? Yes. Crane Holdings was incorporated by you, was it? In Ireland, yes. In Ireland? Yes. In around when? About 1974 or 1975. And was it incorporated to hold the shares in the Dolphin Hotel? 26 27 But Crane Holdings and Nifold were both Irish A. Yes, it was incorporated to buy the Dolphin Hotel 28 itself. 29 Dolphin Hotel. It was the actual purchaser of the 1 260 Q. 2 A. And did it subsequently trade then? Again, there was a planning permission problem. We 3 simply held the Dolphin. 4 used to let the pub trade go ahead even though there 5 was nothing up above. 6 two years or more. 7 261 Q. 8 A. 9 It had a licence and we And that went on for about Yes? Then I got a kind of an indication that the State was interested in it for a Court. 10 As you know, the Circuit Court is there. 11 262 Q. 12 A. Yes? That is the only reason I took a chance on the 13 development. 14 building went bananas in the course of the 15 construction. 16 Trust -- which there may have been; I don't 17 remember -- it was here. 18 Cayman or anywhere. 19 2 63 Q. I was wrong because the price of the If there was a Gerald Hickey It wasn't a trust in When you say there may have been and you don't remember? 20 21 A. 22 264 Q. 23 A. 24 265 Q. 25 A. Yes. 26 A. There was no limited company or trust deed. 27 266 Q. 28 29 I just don't honestly remember. You think there may have been? They refer to it. Just because of that? Just getting back to Crane Holdings, it held the shares in the Dolphin Hotel? 1 267 Q 2 A 3 4 That started in 1980. That is why I wanted the money back. 268 Q 5 6 Yes. According to this the shareholder in Crane was Nifold Investments? A Yes. That was because there was an intention that 7 if a profit had been made that the profit would be 8 exported. 9 269 Q 10 A 11 270 Q 12 A 14 271 Q 15 A 16 272 Q 17 A 18 273 Q 19 A 20 274 Q 21 It was a Jersey company but it never did anything. And did you incorporate that company? No, sure I couldn't have incorporated a Jersey Did you seek to have...(INTERJECTION)? Somebody provided it, yes. It was your company? Yes. I think Traynor provided it. Mr. Traynor provided it? Well Guinness & Mahon provided it. Was Mr. Traynor involved in advising on this holding? A 23 24 And what was Nifold Investments? company. 13 22 Yes. No, I don't think so. Actually, he may have been apart from providing the company I think. 275 Q How did he -- how did it come about that 25 Guinness & Mahon or Mr. Traynor was asked to provide 26 a company in relation to this holding? 27 A 28 29 Because it was known that he supplied Jersey companies. 276 Q 1 2 277 Q 3 A You wanted a Jersey company? My idea was that if we made a profit on the 4 Dolphin Hotel, that profit would be put offshore. 5 And again, that the same situation would pertain. 6 278 Q 7 8 Nifold Investments was set up for the purpose of holding any profit that might come in? A 9 Yes. But none came unfortunately. I think the only reason that exists there is because Guinness & Mahon 10 were tidying up and they wanted to get rid of the 11 certificate and they sent it back to me and asked me 12 to sign the receipt for it. 13 279 Q 14 A 15 280 Q Right. You remember that was the situation? Yes, I think I remember that alright. Yes. Now since this document is headed 16 "Gerald Hickey Trust" and refers to shares held by 17 Nifold, it would seem from this document that Nifold 18 was in some way connected with the 19 Gerald Hickey Trust. 20 Nifold Investments was a company that was going to 21 hold monies that would be settled on a trust to be 22 established in Jersey or the Channel Islands? 23 A 24 Is it possible that No, the company that I had some interest in in Jersey was Twin Lakes. 25 281 Q 26 A 27 282 Q 28 A 29 283 Q Right? Nifold never became operative at all. Yes. Tell me about Twin Lakes then? You can see that is referred to later as well. 1 2 It was a small company here. 3 284 Q 4 A Yes ? Again I see Gerald Hickey Trust referred to there. 5 There was never any formal Gerald Hickey trust in 6 the sense of a limited company or trustees or 7 anything like that that I know of. 8 285 Q 9 Just tell me about Twin Lakes. Was Twin Lakes a company incorporated in Jersey? 10 A 11 286 Q 12 Yes, it was. Again, did you cause it to be incorporated or ask for it to be incorporated? 13 A I think so, yes. 14 287 Q From Des Traynor? 15 A I think so, yes. 16 288 Q 17 A 18 289 Q When was that? That would have been about 1972 or 1973. Were there two Twin Lake companies, one called 19 Twin Lake Investments and the other called 20 Twin Lake Jersey? 21 A 22 290 Q 23 A 24 291 Q 25 A 26 292 Q 27 A 28 293 Q 29 A No, that is a misprint. Is that a misprint? Yes . What was name of the company then? Twin Lakes (Jersey) Ltd. There is no Twin Lake Investments Ltd. No, that is a mistake. Twin Lakes (Jersey) Ltd. 1 2 94 Q. 2 What was the purpose of this company being provided by Mr. Traynor? 3 A. 4 295 Q. 5 A. 6 296 Q. 7 A. 8 297 Q. 9 A. 10 2 98 Q. 11 A. 12 299 Q. 13 A. 14 300 Q. 15 A. 16 301 Q. 17 A. 18 302 Q. 19 A. Twin Lakes (Jersey)? Yes? The one on document C £75,000. What are you referring to? To item C. To document C (Exhibit 1)? Yes. Document C of your documents? Yes. If you want to take a break at any stage? No, I will carry on while I can. Twin Lakes was provided by Des Traynor? Provided by Guinness SMahon. By Guinness & Mahon for what purpose? For the purpose of holding the shares. In what? In a company. I forget the name of the company. 20 It doesn't matter anyway. 21 property in Grafton Street. 22 the buying and selling of that property. 23 303 Q. 24 A. This company bought a And I made a profit on Yes? How much the profit was I am not certain because 25 that £75,000 referred to in C, I think that was the 26 whole purchase money. 27 was the profit. 28 29 304 Q. Obviously only a part of it I just cannot remember. So this company that Twin Lake had shares in was a 1 2 If you like I was the beneficial owner of Twin Lakes 3 when Twin Lakes was the beneficial owner of the 4 shares in that company. 5 305 Q 6 A 7 306 Q 8 A 10 307 Q 11 Ultimately the profits made by that company would go Yes . You made a profit. That profit then went to Twin Lakes? A 13 14 Which owned the Grafton Street property. to you? 9 12 Right. It went to Twin Lakes. It went according to that to Gerald Hickey Trust. 308 Q Leaving that document aside, it is your recollection 15 and your account that I am interested in now. 16 recollection of this is that the profit on this 17 transaction went to Twin lakes? 18 A 19 309 Q 20 A 21 It went to Twin Lakes. In Jersey? Yes. It wasn't £75,000, that was the whole purchase money I think. 22 310 Q 23 A Right. I think the profit made on it was something like £25,000. 24 25 311 Q 26 A 27 312 Q 28 29 Your Yes ? That is only recollection. In any event it was a profit and it went out to Twin Lakes in Jersey? A 1 Yes. 2 Guinness 3 companies, 4 m i n d that t he y w o u l d h o l d m o n i e s that w o u l d be 5 s e t t l e d on a Je r s e y trust? 6 A 7 314 Q Is it a p o s s i b i l i t y Mr. & M a h o n in d e a l i n g w i t h y o u r t w o J e r s e y N i f o l d a n d T w i n L a k e w o u l d h a v e h a d in P e r h a p s t h e y I b u t it c e r t a i n l y d i d n ' t h a p p e n . A s f a r as y o u k n e w t h e m o n i e s w e n t to 8 Twin Lakes. 9 that right? 10 A 11 31 5 Q A 14 316 Q 16 A 17 t h a t is r i g h t . T h e m o n e y t h a t w e n t t o T w i n L a k e s w a s w h e r e then . Guinness & M a h o n h a d ver y little to do w ith Yes? A n d t h e n I d e a l t w i t h it m y s e l f a f t e r w a r d s and I p a s s e d the p r o f i t to Jersey. 18 317 Q 19 A 20 318 Q 21 Yes. W h e r e in J e r s e y w a s i t? I forget, some b a n k in Jersey. W a s it a G u i n n e s s of G u i n n e s s A 23 24 is T w i n L a k e s e x c e p t p r o v i d i n g it. 15 22 Yes, Y o u s a y no m o n e y w e n t t o N i f o l d , W h e r e was that invested? 12 13 T r a y n o r or & M a h o n J e r s e y trust, a subsidiary & Mahon? It c o u l d h a v e b e e n . I h o n e s t l y forget. It w e n t to a Jers e y b a n k anyway. 319 Q If y o u l o o k at y o u r d o c u m e n t C (Exhibit 25 o n it s a y s 26 ba n k s tatements of Guinness 27 Ltd. 28 M a y b e t h a t is w h e r e t h e m o n e y w e n t to. 29 m o n e y w e n t to J e r s e y . 1), the note "refe r en c e s h e r e i n are t a k e n f rom the & Mahon Jersey Trust I know the 1 It s e e m s 2 T r u s t Ltd, 3 l o d g e m e n t s w e r e m a d e to G u i n n e s s 4 T r u s t o f a c h e q u e to t h e G e r a l d H i c k e y T r u s t fo r 5 £75,000. 6 £375? 7 A Yes. from a stat e m e nt of Gu i n n e s s & Mahon Jersey w h i c h a p p e a r s in t h i s d o c u m e n t , that & Mahon Jersey A n d a l s o t h e r e is a d e b i t t o T w i n L a k e s of I must sa y if t h e y h a d the trust, I never knew about i t . 8 9 32 1 Q 10 A 11 322 Q 12 A 13 32 3 Q You didn't k n o w a b o u t i t? I was dealing with Twin Lakes (Jersey) myself. Yes ? S t r a i g h t f o r w a r d f r o m m e to t h e c o m p a n y . Yes. We can p ass on f rom there. 14 C a n I s h o w y o u d o c u m e n t s at p a g e 21 a n d 23. 15 I w i l l p a s s t h e s e t w o d o c u m e n t s t o you, 16 (Same h a n d e d ) 17 C a y m a n Ltd. 18 left-hand corner there 19 A 20 324 Q Mr. Hickey. p a g e 21 is a s t a t e m e n t f r o m A n s b a c h e r Y o u c a n se e t h a t u p i n t h e t o p (Exhibit 6)? Yes . It is n o t v e r y c l e a r b u t it is a b a n k s t a t e m e n t o f 21 A n s b a c h e r C a y m a n L i m i t e d w i t h H e n r y A n s b a c h e r in 22 London? 23 A 24 32 5 Q Yes . It is a n a c c o u n t i n t h e n a m e o f A n s b a c h e r C a y m a n in 25 H e n r y A n s b a c h e r & Company, 26 out e v e r y t h i n g except the r e f e r e n c e to yourself. 27 We have 28 £82,005, 29 "G. London. We have blot t e d H i c k e y " a n d t h e n t h e r e is a f i g u r e o f a d e b i t to t h a t a c c o u n t ? 1 326 Q 2 A It m a y h a v e b e e n a b o r r o w i n g f o r s o m e s p e c u l a t i o n o r 3 other but 4 I have never seen that before. 5 327 Q 6 A 7 328 Q I really don't You have n ever seen that before? No. The date of that stat e m e n t 8 beside 9 "24th June 1996." 10 A 11 329 Q k n o w w h a t it is ab o u t . is u p at t h e v e r y top, "Ansbacher Cayman Ltd" up in t h e m i d d l e as Do y o u s e e t h a t ? T h a t is e x t r a o r d i n a r y . W h a t t h i s a p p e a r s to i n d i c a t e is t h a t t h e r e w a s a 12 p a y m e n t t o you. 13 t r a n s a c t i o n is h e r e o n t h e s t a t e m e n t as 14 21st June 1996 of £82,000. 15 s t e r l i n g of £82,000 w h i c h was d e b i t e d to A n s b a c h e r 16 Cayman's account 17 A 18 33 0 Q 19 A 20 33 1 Q Yes? 21 A Yes. It is a p a y m e n t in in H e n r y A n s b a c h e r ? W h i c h w a s d e b i t e d to m e a n a p a y m e n t t o m e ? Yes, a p a y m e n t to y o u ? T h a t is a d e b i t ? I h o n e s t l y am t o t a l l y t a k e n aback. I am r e a l l y t o t a l l y t a k e n a b a c k b y that . 22 23 332 Q 24 A 25 33 3 Q 26 A 27 334 Q 28 A 29 A n d in fact the d a t e of the You don't know what that c o u l d be to do with? No. You can keep that document, Mr. Hickey? It m i g h t r e f e r t o t h e r e p a t r i a t i o n a f t e r h e d i e d Yes, . t h a t is r i g h t ? It m i g h t r e f e r t o t h e r e p a t r i a t i o n of t h e o t h e r m o n e y I was t e l l i n g you about, the other shares . 1 33 5 Q. 2 A. W o u l d t h e y b e r e p a t r i a t e d to y o u ? No, n o t t o me, it w o u l d h a v e g o n e I w o u l d h a v e 3 t h o u g h t s t r a i g h t to E u r o p e . B u t he m a y h a v e p u t it 4 t h r o u g h s o m e t h i n g in L o n d o n , I j u s t d o n ' t know. 5 3 3 6 Q. 6 A. 7 337 Q. It is m a d e p a y a b l e to y o u w h a t e v e r t h i s I c a n t e l l y o u I d i d not. T h a t w o u l d b e a v e r y s m a l l a m o u n t a l l t h e same, 8 w o u l d n ' t it. 9 s h a r e s at t h a t s t a g e ? 10 A. 11 338 Q. 12 A. 13 3 3 9 Q. 14 A. 15 34 0 Q. 16 A. 17 34 1 Q. W o u l d that a mount equate the o ther two My share was £70,000. Yes? T h a t m i g h t b e o n e o f t h e o t h e r two. Just one? Yes. But w h y w o u l d one be m a d e p a y a b l e to you? I d o n ' t know. D o e s n ' t it s e e m u n l i k e l y t h a t i n 1 9 9 6 t h e £ 7 0 , 0 0 0 18 w o u l d o n l y h a v e a m o u n t e d to £82,000. 19 have been transactions 20 A. 21 342 Q. 22 A. 23 34 3 Q. 24 A. 25 26 s u m is? There must in b e t w e e n ? T h e y m a y h a v e d r a w n o n it. B u t w e r e y o u n o t d e a l i n g w i t h it f o r t h e m ? Yes, not entirely. They may h a v e . . . (INTERJECTION). But they weren't dealing directly? I d o n ' t know. I don't think they did but they might have . 344 Q. 27 Do y o u r e c o l l e c t m a k i n g w i t h d r a w a l s for the other shareholders ? 28 A. 29 34 5 Q. No, I d o n 't . O r a s k i n g to h a v e w i t h d r a w a l s m a d e for them? 1 2 The o n l y e x p l a n a t i o n that yo u can t h i n k of for this 3 is t h a t t h i s w a s o n e of t h e s h a r e s a n d t h a t it w a s 4 b e i n g p a i d to you. 5 h a v e t o g i v e it t h e n to t h e o t h e r p e r s o n . 6 that be right? 7 A M aybe that That w o u l d m e a n that you would I was s u p p o s e d to p ut t h a t t h r o u g h t h e n to E u r o p e . 8 9 347 Q 10 A Do you r e c o l l e c t that h a p p e n i n g in 1996? No, I don't. B u t as f a r as I u n d e r s t a n d t h e y d i d 11 repatriate. 12 m o n e y t o E u r o p e a f t e r T r a y n o r died . 13 Would 348 Q I t o l d you this; the y r e p a t r i a t e d the A t t h i s s t a g e I h a v e to a s k y o u w h o t h e t w o 14 s h a r e h o l d e r s were. 15 i n v e s t i g a t i o n b e c a u s e it is c l e a r n o w t h a t t h e y w e r e 16 both persons 17 A n s b a c h e r Cayman. 18 t e r m s of r e f e r e n c e to i d e n t i f y s u c h p e r s o n s . 19 must ask you who they were? 20 A It is r e l e v a n t t o o u r o r e n t i t i e s w h o h e l d m o n e y in A n d w e a r e o b l i g e d as p a r t o f o u r I am in the d i f f i c u l t y that So I I m i g h t have to say I 21 must 22 t h a t I w a s n o t e n t i t l e d to d i s c l o s e t h e n a m e o f t h e 23 clients. 24 T h e y w e r e n o t h i n g w h a t e v e r to d o w i t h t a x i n t h i s 25 country. 26 So is y o u r p o s i t i o n t h a t u n t i l y o u t a k e f u r t h e r 27 legal advice you are not a n s w e r i n g that question? 28 I have taken the advice. 29 I s h o u l d n 't . seek formal legal advice because These people, as I say, I was told were continentals. I have bee n a d vised that 1 35 0 Q 2 A 3 4 35 1 Q I understand. But I w a n t to be c l e a r t h a t you are refusing? 6 A 7 352 Q 8 A 9 I t h i n k I h a v e t o at t h e m o m e n t . I see, right. I d o n ' t k n o w w h e r e t h e y a r e no w. I t h i n k o n e of t h e m is d e a d a n d I a m n o t c e r t a i n i n E u r o p e w h e r e t h e y are. 10 11 35 3 Q 12 A 13 Wer e there two or more? Two people, h u s b a n d and wife. A n d t h e h u s b a n d is dead. 14 354 Q 15 A 16 They were shareholders They weren't in C l o n m e l E s t a t e s ? shareholders, t h e y h a d an interest. T h e r e w a s n o r e g i s t r a t i o n o f t h e m as s h a r e h o l d e r s 17 35 5 Q 18 A 19 356 Q They weren't the registered shareholders? No. But t h e y w e r e the b e n e f i c i a l o w n e r s of t h o s e o t h e r shares ? 20 21 A 22 357 Q 23 25 I am not t r y i n g to be uncooperative. 5 24 I t h i n k I h a v e to hone s t l y . I was holding two-thirds f o r them . T h e y w e r e r e g i s t e r e d in y o u r n a m e r a t h e r t h a n somebody else? A Yes . MR. BOHAN: 26 They may have been r e g i s t e r e d in n o m i n e e 27 n a m e s r a t h e r t h a n in y o u r s d i r e c t l y . 28 Yes, 29 right, t h e y m a y h a v e b e e n in n o m i n e e n a m e s . yes. But I am not q uite certain. T h a t is . 1 2 358 Q 3 A 4 359 Q 5 A Yes . I d o n ' t k n o w w h a t is in t h i s one. M a y b e we w i l l l o o k at t h e o t h e r o n e ? I h a v e n e v e r s e e n it e i t h e r . 6 never 7 I r i s h I n t e r c o n t i n e n t a l B an k . 8 36 0 Q 9 Mr. T h a t is o u t r a g e o u s . I h a d a n y t h i n g to do w i t h Hickey, a lo t o f p e o p l e a r e t a k e n a b a c k b y I r i s h I n t e r c o n t i n e n t a l B a n k. T h a t is v e r y s i m p l y 10 e x p l a i n e d b y t h i s: 11 A n s b a c h e r C a y m a n w e r e a b l e to u s e f u n d s h e l d in t h e 12 n a m e o f A n s b a c h e r C a y m a n in G u i n n e s s 13 1991/1992 14 A n s b a c h e r C a y m a n in G u i n n e s s 15 t r a n s f e r r e d to I r i s h I n t e r c o n t i n e n t a l Bank. 16 didn't nece s s a r i l y mean that the people dealing with 17 A n s b a c h e r C a y m a n k n e w t h a t t h i s a c c o u n t w a s m o v e d to 18 I r i s h I n t e r c o n t i n e n t a l so t h a t is w h y y o u w o u l d n ' t 19 nece s s a r i l y know that you had any dealing with 20 Irish Intercontinental Bank? 21 A 22 36 1 Q A n ybody who had monies with & M a h o n u p to at w h i c h s t a g e t h e a c c o u n t of & Mahon was closed and That Yes . Nevertheless Irish Intercontinental Bank was dealing 23 w i t h t h e A n s b a c h e r C a y m a n a c c o u n t a n d so w h e n e v e r 24 Mr. 25 A n s b a c h e r C a y m a n a ccount he w o u l d give i n s t r u c t i o n s 26 to Irish I n t e r c o n t i n e n t a l Ban k and t h e y w o u l d 27 t r a n s f e r it o r do w h a t e v e r t h e t r a n s a c t i o n was. 28 W h a t t h i s a p p e a r s to r e l a t e to h e r e is, 29 t e l e f a x f r o m J o h n F u r z e as y o u s e e u p t h e r e o n t h e T r a y n o r w i s h e d t o h a v e m o n e y t r a n s f e r r e d to t h e t h i s is a 1 Yes . 2 3 362 Q U n f o r t u n a t e l y o u r p h o t o c o p y is v e r y b a d a n d y o u 4 c a n n o t se e t h e f u l l t i t l e , 5 b e l i e v e m e t h a t it is C a y m a n I n t e r n a t i o n a l B a n k & 6 Trust Group. 7 se e t h e a d d r e s s . 8 British West 9 Ansbacher? 10 A 11 36 3 Q b u t y o u w i l l h a v e to Over on the r i g h t - h a n d side you will It is PO B O X 887, Indies, G r a n d Cayman, w h i c h is t h e a d d r e s s of Yes . Mr. J o h n F u r z e y o u m a y h a v e h e a r d o f or y o u m a y know? 12 13 A 14 364 Q 15 A 16 36 5 Q 17 I h e a r d o f him. You h e a r d of him? Yes . He w a s o n e o f t h e m a n a g i n g d i r e c t o r s of Ansbacher Cayman? 18 A 19 3 66 Q Yes, I h a d h e a r d a b o u t him. It w a s t h e n c a l l e d C a y m a n I n t e r n a t i o n a l B a n k & 20 Trust. 21 w h a t at t h a t t i m e w a s c a l l e d C a y m a n I n t e r n a t i o n a l 22 B a n k & T rust to I r i s h I n t e r c o n t i n e n t a l B a nk? 23 A 24 367 Q H e is w r i t i n g f r o m w h a t is n o w A n s b a c h e r a n d Yes . R e f e r r i n g to ou r " a c c o u n t n u m b e r 0 2 0 1 0 8 0 7 - 8 1 . " 25 Y o u se e t h a t d o w n at t h e b o t t o m . 26 n u m b e r ." 27 A 28 368 Q 29 Yes, "Debit our account I s e e that . He is a s k i n g t o h a v e A n s b a c h e r 's a c c o u n t in Irish I n t e r c o n t i n e n t a l Ban k d e b i t e d w i t h an amount 1 2 A. 3 4 Yes, I h a v e a n a c c o u n t i n L l o y d s Bank, Knightsbridge. 3 6 9 Q. 5 T h i s is 1994. W o u l d you recollect s e e k i n g to w i t h d r a w m o n e y f r o m C a y m a n in 1994? 6 A. 7 37 0 Q. 8 A. 9 I d o n ' t t h i n k I did. A n d t r a n s f e r r i n g it t o y o u r a c c o u n t ? I do not t h i n k I d id b e c a u s e I h a d n o r e a s o n to. I didn't p a r t i c u l a r l y want money. But, 10 n e v e r r e a l l y k n e w w h a t was g o i n g on in 11 Guinness 12 37 1 Q. 13 A. 14 372 Q. 15 A. Yes? I t h i n k t h a t w a s a f t e r T r a y n o r w a s de a d . Yes. T r a y o r d i e d in M a y of that year? T h a t is r i g h t , yes. I don't k n o w w h a t it w a s a b o u t b u t o f c o u r s e t h e T w i n L a k e s th i n g , 17 i n s o m e h a v e n s as t h e y c a l l them . 18 37 3 Q. Yes? 19 37 4 Q. And that may have been moved around? 20 37 5 Q. Yes? 21 A. there was m o n e y He w a s a n i n c r e d i b l e m a n f o r m o v i n g m o n e y a r o u n d a n y w h e r e h e f e l t like. 22 3 7 6 Q. W h e n Mr. T r a y n o r d i e d if yo u w i s h e d to give 24 instructions 25 o n b e h a l f of t h e s e t w o p e o p l e w h o h e l d m o n i e s 26 C l o n m e l or on b e h a l f o f y o u r o w n d e p o s i t s , 27 y o u c o n t a c t in G u i n n e s s 28 death. 29 you & Mahon. 16 23 ag a i n , in r e l a t i o n to a n y o f t h e m o n i e s h e l d W a s it Mr. & M a h o n a f t e r Mr. Collery? in who did Traynor's 1 2 377 Q But he w a s n ' t 3 378 Q He h a d b e e n ? 4 379 Q B u t at t h i s t i m e h e w a s . . . ( I N T E R J E C T I O N ) ? 5 A Mr. 6 7 Yes, 38 0 Q in G u i n n e s s & Mahon? at t h i s t i m e h e w a s d o i n g . .. Collery. I know t h e m both. Do y o u r e c o l l e c t c o n t a c t i n g Mr. F i e l d - C o r b e t t t o do transactions ? 8 9 A 10 38 1 Q No, 12 A 13 382 Q I d o not. Is it p o s s i b l e t h a t t h i s is s o m e t h i n g y o u w o u l d a s k Mr. 11 C o l l e r y to do p e r h a p s ? To d o w h a t ? T h i s t r a n s a c t i o n w e a r e l o o k i n g at i n r e l a t i o n to 14 I r i s h I n t e r c o n t i n e n t a l Bank. 15 telefax? 16 It m u s t h a v e b e e n A 17 I m i g h t have. The J ohn Furze W h y I should have got £12,000 sterling. 18 38 3 Q 19 A 20 384 Q 21 A 22 38 5 Q 23 A 24 386 Q 25 A 26 387 Q D i d y o u m e e t Mr. Furze himself ever? I o n c e m e t him. W h e r e you in c o r r e s p o n d e n c e w i t h him? No. C o u l d y o u h a v e a s k e d h i m to m a k e t h i s t r a n s f e r ? No, never. He w o u l d n ' t h a v e d o n e t h i s o n y o u r i n s t r u c t i o n s ? No, he w o u l d not. I met h i m once in Dublin. So if h e d i d t h i s o n y o u r b e h a l f , it c o u l d o n l y b e 27 o n t h e i n s t r u c t i o n s of s o m e o n e i n e i t h e r 28 Guinness 29 Ireland? & M a h o n o r r e p r e s e n t i n g A n s b a c h e r h e r e in 1 2 388 Q 3 A Yes. Bu t £ 1 2 , 0 0 0 w h e r e it c o m e s 4 5 That w o u l d be the case? 389 Q 7 A 8 390 Q 9 A I w o u l d l i k e t o h a v e a s h o r t w o r d w i t h Mr. Of course, yes. C o u l d we step into the hall? Y e s of c o u r s e . 10 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 I don't know from. C o u l d w e s t e p o u t f or a m o m e n t ? 6 11 is a f u n n y sum. SHORT ADJOURNMENT Rowan. 1 2 3 I w a s t r y i n g to f i n d ou t w h e r e 4 M y w i f e d r e w m y a t t e n t i o n to the fact t h a t we w e r e 5 at R o y a l A s c o t . 6 39 1 Q 7 A 9 392 Q So m a y b e t h e r e w a s s o m e r e a s o n fo r p u t t i n g m o n e y A BOHAN: W a s t h a t 1994, MS. 12 in L l o y d s i n L o n d o n . B e c a u s e y o u w e r e in L o n d o n . MR. 10 11 T h a t is a g o o d p l a c e t o be. into m y account 8 I w a s i n J u n e 1996. Lloyds was 1994. I a m sor ry . MACKEY: Mr. 13 Hickey, we s h ouldn't h a v e to d e l a y yo u m u c h 14 l o n g e r at all. 15 other documents. 16 p a g e 36 o f o u r b r i e f . 17 m e e t i n g o f t h e b o a r d of d i r e c t o r s of 18 Guinness 19 A 20 39 3 Q Yes, I w o u l d l i k e to s h o w y o u a c o u p l e o f C a n I s h o w y o u a d o c u m e n t at T h i s is a n e x t r a c t f r o m a & M a h o n on 28th N o v e m b e r 197 4 ( E x h i b i t 8). I h a v e t h i s. Y o u h a v e a c o p y of t h a t. T h e h e a d i n g is 21 " R e s i d e n t l o a n s £ 1 0 , 0 0 0 a n d o v e r " a n d y o u se e y o u r 22 name there? 23 A 24 394 Q 25 A 26 39 5 Q Yes . With present balance £261,306? Yes . This is 1 974. T h e r e p a y m e n t d a t e is 27 3 1 s t M a r c h 1 9 7 5 a n d t h e c o m m e n t is 28 e x c e s s d u e to i n t e r e s t . " 29 A "suitably secured 1 "Suitably secured" Guinness 2 m a n y t i m e s in p u b l i c in t h e M o r i a r t y T r i b u n a l , 3 it is n o w c o m m o n k n o w l e d g e t h a t w h e n t h e y u s e t h i s 4 p h r a s e t h e y m e a n s e c u r e d o n a d e p o s i t w i t h o n e of 5 their offshore subsidiaries? 6 A & M a h o n has e x p l a i n e d A s I s a i d to y o u i n t h e l e t t e r , I know th e y did that 7 but I don't t h i n k that e v e r y t h i n g t h e y said was 8 s u i t a b l y s e c u r e d m e a n t t ha t . 9 397 Q Guinness 10 11 A 12 398 Q 13 A 14 15 3 99 Q A 400 Q That w e r e s e c u r e d in o f f s h o r e d e p o s i t s ? No, I d o n ' t t h i n k so. W e l l so r r y , I m a y h a v e had. W o u l d the y have b e e n secu r e d on your depos i t s either Islands? It m i g h t h a v e b e e n o n e o r t h e o t h e r . They were It is p o s s i b l e t h a t y o u r l o a n s s e c u r e d o n y o u r offshore deposits? A It is p o s s i b l e . But t h e y w o u l d be small. They w o u l d be v e r y small. 22 23 Yes . s w i t c h i n g m o n e y around. 20 21 from & Mahon? i n C a y m a n or in t h e C h a n n e l 18 19 did you have loans I m a y h a v e h a d s o m e t h i n g t h a t t h a t w a s p a i d o u t of. 16 17 C a n I a s k you, and 401 Q Yes, I understand. I don't t h i n k I n e e d to a sk you 24 any other questions. Mr. 25 questions If I c o u l d a s k y o u o n e o t h e r 26 final thing, 27 Cayman deposit 28 situation and you said Guinness 29 certificates ? al l r i g h t . Mr. Hickey: R o w an will have some In t a l k i n g a b o u t y o u r I was asking you about the tax & M a h o n sent you the 1 2 402 Q 3 A 4 403 Q Yes . In r e l a t i o n to t a x a c c r u i n g in y o u r a c c o u n t in 5 Guinness 6 dec l a r e d that also? 7 A 8 404 Q 9 A Yes. & M a h o n J e r s e y Trust, would you have They w o u l d have sent certificates Guinness & Mahon Jersey Trust would have? Whoever any deposit I h a d a b r o a d as f a r as I 10 u n d e r s t a n d it, 11 I n t e r e s t c r e d i t e d or i n t e r e s t paid. 12 405 Q 13 A 14 406 Q 15 A 16 407 Q 17 A 18 408 Q 19 I go t a c e r t i f i c a t e o f i n t e r e s t p a i d . You would have declared that? I w o u l d h a v e d e c l a r e d that. A 21 409 Q 22 A 23 410 Q 24 A Yes . A n d they d e clared them? T h e y w o u l d d e c l a r e them. P r e s u m a b l y S K C w o u l d h a v e d o c u m e n t s r e l a t i n g to I d o n ' t t h i n k so. Mr. Would they? I t h i n k t h e y a r e l o n g s i n c e go n e . R e i d w a s i n v o l v e d in a l l o f t h e s e ? Yes . He m i g h t r e c o l l e c t if w e w e r e to a s k h i m ? I don't t h i n k he has a n y t h i n g either. 25 He is a b i t l i k e Mr. 26 i n w r i t i n g if p o s s i b l e . 27 28 29 411 Q I s e n t t h e m t o SKC. Y o u s e n t t h e m to S K C ? these companies. 20 of i nterest. I see. Mr. Traynor. He d i d n ' t p u t t h i n g s I h ave no further questions, Rowan has a few questions Mr. f o r you. Hickey. about your documents. END OF EXAMINATION OF MR. HICKEY BY MS. 58 MACKEY 1 2 3 MR. ROWAN: Mr. 4 e x p l a i n e d to Ms. 6 o w n e r of this c o m p a n y ? 7 A 8 413 Q 9 Yes, you Mack e y that you were the beneficial as f a r as I r e m e m b e r . W e r e yo u the b e n e f i c i a l o w n e r b e c a u s e yo u h e l d an i n t e r e s t i n an i n t e r m e d i a t e b o d y or d i d y o u a c t u a l l y hold the shares yourself? 10 A No, I think I held them myself. 12 certain. 13 l i q u i d a t e d l o n g since. 14 the Twin Lakes Jersey Ltd company, 5 11 Hickey, 414 Q I am not quite T h e c o m p a n y o f c o u r s e is g o n e a n d I am not e n t i r e l y clear. I am a little confused 15 from the papers where some abbreviations 16 times ? 17 A 18 415 Q 19 A 20 416 Q 21 A a r e u s e d at Yes . W h a t was the c orrect name of the T win Lakes c ompany? Twin Lakes (Jersey) Ltd. Right? T h a t is m y r e c o l l e c t i o n . Investments. T h e r e w a s n o s u c h t h i n g as 22 Twin Lakes Remember, Brian, 23 you that was a mistake? 24 MR. BOHAN: T h a t is r i g h t . 25 MR. ROWAN: W e c a n se e f r o m I s a i d to 26 D o c u m e n t E -- if I c o u l d 27 a s k y o u to t u r n to t h a t -- t h a t M a r s n o m i n e e s h e l d 28 s h a r e s in T w i n L a k e s 29 ( J e r s e y ) ( E x h i b i t 1)? 1 418 Q 2 A 3 419 Q It w a s t h e G u i n n e s s Effectively, & Mahon nominee company. does that me a n that Mars nominees were 4 a c t u a l l y h o l d i n g s h a r e s o n y o u r b e h a l f as t h e 5 beneficial 6 A 7 8 I d o n ' t t h i n k so. 420 Q I a p p r e c i a t e that , but who were Mars nominees acting as a n o m i n e e on b e h a l f o f if it w a s n ' t A shareholders 12 was the same thing. 13 T w i n Lakes. 14 421 Q 15 A 16 422 Q 17 A 18 423 Q 19 for yourself? In a s e n s e it w a s e i t h e r f o r m y s e l f or t h e 11 20 T h e y m i g h t h a v e h e l d t h e m as s e c u r i t y for advances. 9 10 No, owner? in T w i n L a k e s , T h a t is t h e p o i n t whichever you like which I w a s t h e s h a r e h o l d e r in I am just tr y i n g to clarify? Yes . Y o u w e r e the sole s h a r e h o l d e r in T w i n L a k e s ? Yes . A n d y o u a s k e d M a r s n o m i n e e s to h o l d t h e s e s h a r e s o n your behalf? A I don't know that I did. I thought that I myself 21 stayed with Twin Lakes personally. I thought that 22 but I m a y be wrong. t h i s is a l o n g 23 time ago and I am not certain. 24 finance document, 25 a b s o l u t e l y no idea b e c a u s e the last t h i n g that a 26 l i t t l e c o m p a n y l i k e T w i n L a k e s w o u l d b e d e a l i n g in 27 is g i l t s . . 28 were buying and selling property. 29 w o u l d w a n t i n t h e w o r l d is g i l t s . Do n o t forget, Y o u se e t h i s 198 2 w h a t t h a t is a b o u t I h a v e We were s p e c u l a t i n g in property. We T h e l a s t t h i n g we 1 T a k i n g t h e d o c u m e n t at i t s f a c e v a l u e it s e e m s 2 e f f ectively that Guinness 3 some c o m f o r t b e c a u s e t h e y w e r e the h o l d e r s of some 4 shares ? 5 A 6 425 Q 7 8 & Mahon were obtaining Yes . F i r s t of a l l in t h e f i n a n c e s t o c k a n d t h e n in Twin Lakes? A 9 Yes. Or Twin Lakes hel d the finance stock and therefore they took Twin Lakes shares into Mars nominees. 10 11 426 Q 12 A 13 427 Q I see. I didn't appreciate that from the document? T h a t is p o s s i b l e I th i n k . B u t e f f e c t i v e l y if G u i n n e s s & M a h o n w e r e t r y i n g to 14 derive 15 p r e s u m a b l y w a s b e c a u s e t h e y w e r e a d v a n c i n g m o n e y to 16 someone? 17 A 18 428 Q 19 A some c o m f o r t f r o m h o l d i n g t h e s e shares, T h e y wer e , that yes. P r e s u m a b l y that was to y o u r s e l f or to the c o m p a n y ? It w a s to s o m e o t h e r c o m p a n y . T h e r e w e r e so m a n y 20 companies floating around. 21 companies in w h i c h I was i n v o l v e d f l o a t i n g around. 22 I h a d a bit of this and a bit of that. 23 t h i n g w a s j u s t so c o m p l i c a t e d . 24 429 Q 25 26 Could you recall companies, A No, T h e r e w e r e a b o u t 10 The w hole f o r us t h e n a m e s of t h o s e please? I cannot, t h e y a r e a l l l o n g s i n c e l i q u i d a t e d at 27 this 28 p o i n t e d o u t to you. 29 a n d t h i s t i e s in w i t h t h e e x p l a n a t i o n I w a n t e d to stage. T h e y w e r e a l l s h e l f c o m p a n i e s as I W h a t u s e d to h a p p e n t o m e - ­ 1 m a k e a b o u t A. 2 i n s t r u c t e d to b u y a p r o p e r t y . 3 usua l l y came either from Guinness 4 f i r m of a c c o u n t a n t s . 5 a g r e e d to b u y s u c h a n d s u c h p r o p e r t y f o r so m u c h . 6 The dep o s i t 7 sign the contract 8 430 Q 9 W h a t h a p p e n e d was, I w o u l d be The ins t r u c t i o n s & M a h o n or f r o m a I w o u l d si m p l y be t o l d we have is so m u c h . C h e q u e is h e r e . Please in trust. W i t h o u t w a n t i n g t o c h a n g e y o u r t r a i n of t h o u g h t , w h a t w e a r e t r y i n g t o d e a l w i t h t o d a y is a c t u a l l y 10 your involvement with Guinness 11 things we have b e e n t a l k i n g about? 12 A 13 431 Q Guinness & M a h o n w e r e h o l d i n g t h e s e s h a r e s as a s e c u r i t y for some lending. 15 t o be. A 17 432 Q 18 A 20 433 Q 21 T h a t is w h a t it a p p e a r s W o u l d you agree with that? T h a t is p r o b a b l y so, A l l right. Mr. yes. Hickey, c ould I ask you to please t u r n t o y o u r s t a t e m e n t at 19 M a h o n a nd the Yes . 14 16 & (j) (Exhibit 1)? Yes . Y o u s a y here : "This was about the time I was developing Dolphin House." 22 23 A T h a t is r i g h t . W h e n I s a y "I" I m e a n C r a n e H o l d i n g s 24 w a s t h e c o m p a n y t h a t o w n e d it. 25 development, 26 434 Q 27 A 28 435 Q 29 It w a s m y s o l e n o b o d y e l s e h a d a n y i n t e r e s t i n it. Crane Holdings acquired the Dolphin Hotel? Yes . Did C rane H o l d i n g s pass that h otel on to an o th e r company? 1 It d i d to a c o m p a n y c a l l e d N e m e a n H o l d i n g s , 2 a l s o l o n g s i n c e gon e. 3 436 Q 4 A 5 437 Q Where was that company incorporated? In I r e l a n d . Okay. W h e n I s a i d to y o u it p a s s e d p r e s u m a b l y t h e 6 p r o p e r t y o n to N e m e a n H o l d i n g s , 7 what happened? 8 A 9 is t h a t a c t u a l l y I b r o u g h t t h e l a n d i n a b o u t t h e m i d 1 9 7 0 's a n d h a d t o l e a v e it t h e r e . 10 438 Q 11 A 12 439 Q 13 A 14 Yes ? A n d as I t o l d you, s i m p l y t a k e i n c o m e f r o m t h e bar. Yes ? A n d t h e n I w a s g o i n g to d e v e l o p it s t a r t i n g in 1980. A n d we d e c i d e d t h e n to p u t it i n t o a n e w c o m p a n y . 15 440 Q 16 A W h y d i d y o u f e e l a n e e d t o do t h a t ? I t h i n k t h e r e w a s s o m e t a x r e a s o n f o r it. 17 t o h a v e it as a n e w st ar t. 18 MR. BOHAN: Also We wanted f o r t a x r e a s o n s i f he was trading 19 20 . . . (INTERJECTION) 21 MS. MACKEY: I a m so r r y , t a k e Mr. 22 23 24 w h i c h is b u t w e n e e d to Hickey's evidence so as n o t to cu t a c r o s s him. A We were trading. We had b e e n t r a d i n g and we didn't 25 w a n t t h e t r a d i n g c o m p a n y t o b e i n v o l v e d so w e 26 t r a n s f e r r e d it i n t o N e m e a n . 27 28 29 441 Q MR. ROWAN: Which was e f f ectively a property company? 1 2 442 Q. 3 4 T h e s h a r e s in N e m e a n H o l d i n g s L t d w e r e h e l d b y Crane Holdings? A. 5 6 Yes. No, Crane Holdings disappeared; Crane Holdings s i m p l y s o l d the p r o p e r t y to Nemean. 443 Q. 7 I see, yes. W h o w e r e t h e h o l d e r s of t h e s h a r e s in Nemean? 8 A. Nifold. 9 444 Q. Nifold? 10 A. Sorry, the s h a r e s in C r a n e Hold i n g s . Y o u see, 11 d i d n ' t c h a n g e it o v er. 12 t h a t is w h y t h e y g a v e m e b a c k t h a t c e r t i f i c a t e . 13 see, 14 the Dolphin, 15 overseas. 16 445 Q. 17 A. 18 W h a t h a p p e n e d was, we maybe You it w a s i n t e n d e d t h a t t h e c o m p a n y t h a t d e v e l o p e d i f it m a d e a p r o f i t it w o u l d p u t t h a t I understand? A c t u a l l y that sh o u l d be N e m e a n Holdings. We had N e m e a n as w e l l as C r a n e . 19 44 6 Q. 20 A. Which document a r e y o u l o o k i n g at? I a m l o o k i n g at t h a t d o c u m e n t o n p a g e 41 (Exhibit 21 1). 22 useless 23 b e c a u s e C r a n e w a s g o n e a n d it w a s N e m e a n t h a t s h o u l d 24 h a v e b e e n h o l d i n g it, 25 s h a r e s in N i f o l d . 26 447 Q. 27 A. 28 448 Q. 29 A l l t h e y w e r e d o i n g is s e n d i n g m e b a c k a old certificate. T he y were c l e a n i n g up as I t h i n k it w a s h o l d i n g s t h e Okay? They were simply giving me back a dead document. N i f o l d h e l d t h e s h a r e s in N e m e a n H o l d i n g s L t d ? 1 449 Q property? 2 3 A 4 450 Q 5 A T h a t is r i g h t . A l l right. So t h a t is w h a t y o u m e a n a b o u t I a m s or ry , I k e e p c o n f u s i n g it. "I"? I was the sole p e r s o n in t h a t . 6 7 W h i c h was t hen the c o m p a n y w h i c h d e v e l o p e d the 451 Q Yes, I understand. borrowings 8 9 A 10 452 Q 11 A In f a c t y o u s a y t h a t t h e from Guinness & Mahon .. .(INTERJECTION)? For this dev e l o p m e n t ? Yes ? No. F i r s t of all, I p u t m y o w n m o n e y i n t o it a n d of 12 course that was 13 p r e v i o u s l y b o u g h t the p r o p e r t y b a c k in the mi d 14 1 9 7 0 's f o r £ 1 5 0 , 0 0 0 . 15 p u t t h a t i n t o it as w e l l at t h e s t a r t of 16 development. 17 453 Q 18 Yes. for the se c o n d property. That was m y own m o n e y and I I s h o u l d h a v e g o n e o n t o say, borrowings for development were transferred from AIB? 19 A Yes, 20 454 Q Yes? 21 A f i r s t of a l l w e b o r r o w e d f o r t h i s p u r p o s e . I d i d a g r e a t a m o u n t of o t h e r t h i n g s w i t h AIB, but i n i t i a l l y A I B a g r e e d to f i n a n c e t h e d e v e l o p m e n t . 22 23 455 Q 24 A Yes ? T h e y g o t c o l d f e e t at a c e r t a i n s t a g e . 25 the thing was going wrong. 26 in the end but 27 that p a r t i c u l a r stage. 28 ICC. 29 I had They thought W h i c h p r o v e d to be right I d o n ' t k n o w w h e t h e r t h e y d e c i d e d at B u t a n y way, t h e n I w e n t to 1 I C C a g r e e d t o t a k e it o v e r a n d A I B e f f e c t i v e l y w e r e 2 t a k e n out. 3 457 Q 4 A Yes ? There were also these German shares which had been 5 bought, 6 documents. 7 t h o s e d o c u m e n t s as a d d i t i o n a l 8 458 Q 9 A w h i c h h ave b e e n l i s t e d there in one of the ICC i n s i s t e d on g e t t i n g the s e c u r i t y of All r i g h t . T h o s e s h a r e s a r e l i s t e d i n "J" o f m y s t a t e m e n t ( E x h i b i t 1). 10 11 459 Q 12 A 13 460 Q 14 A 15 461 Q 16 ICC said we will l end you the m o n e y ? Yes . They took over the borrowings A 18 462 Q 19 A T h a t is r i g h t . And they said 'but p l e a s e w e h a d n e e d t o t a k e a Additional security, yes. That would have been a fixed charge? No, w h a t h a p p e n e d w a s it w a s o n l y t h e n t h a t 20 Guinness 21 d i d t h e p u r c h a s e o f t he m . 463 Q 23 24 from AIB? s e c u r i t y on t hem? 17 22 security. & M a h o n bought those shares. Actually they I am t a l k i n g about the p r o p e r t y security. Would that have b e e n a f ixed charge on the p r o p e r t y ? A Yes, the p r o p e r t y s e c u r i t y was a f i x e d charge. 25 B u t t h e w a y i n w h i c h t h e s h a r e s w e r e got, 26 Guinness 27 them into College Trustees which I never realised 28 until very very recently. 29 & M ahon bought them and appar e n t l y they put 1 T h a t is w h y a p p a r e n t l y I h a d t o g i v e t h i s l e t t e r - ­ 2 w h i c h I have no r e c o l l e c t i o n of w h a t e v e r - ­ 3 a u t h o r i s i n g ICC to get a c h a r g e on them. 4 r e f e r r e d to in s o m e of t h e c o r r e s p o n d e n c e t h e r e 5 Yes. 6 moment. 7 is r e l e v a n t to s o m e t h i n g w h i c h m a y c o m e u p a l i t t l e 8 later. 9 A 10 466 Q 11 A 12 467 Q 13 A 14 468 Q 15 T h a t is I w i l l come b a c k to the sha r e s in just a I j u s t w a n t to c l a r i f y a p o i n t b e c a u s e it ICC to o k a fixed charge? Yes . Over the property? Yes . A n d that was their security? Their main security. Secondly, t h e y h ad a s u b s i d i a r y s e c u r i t y on some German shares? 16 A 17 469 Q 18 T h a t is r i g h t . These shares were owned by Nemean Holdings or w e r e these owned by another company? 19 A 20 470 Q 21 A T h e y were o w n e d r e a l l y b y T w i n Lakes. The shares w ere o w n e d b y T win Lakes? A n d I t h o u g h t t h e y w o u l d h a v e b e e n in T w i n Lakes' 22 n a m e b u t I d i s c o v e r e d t h e n t h a t Mr. 23 t h e m into the n a m e of this C o l l e g e Trustees, 24 h a d n e v e r e v e n h e a r d of. 25 471 Q 26 A 27 472 Q 28 29 . Traynor had put which I Un f o r t u n a t e l y the Dolphin House project didn't work? It d i d n ' t wo r k , no. W h e n you event u a l l y sold the property, whe n was that as a m a t t e r o f i n t e r e s t ? A I s t a r t e d to d e v e l o p it i n 1 9 8 0 a n d it w a s 67 finished 1 i n 1 9 8 2 o r t h e r e a b o u t s a n d it w a s t h e n l e a s e d t o t h e 2 B o a r d o f W o r k s to t h e S t a t e f o r c o u r t s . 3 a g r e e d to s e l l it. 4 473 Q 5 A 6 474 Q 7 A We then W i t h the b e n e f i t of the cov e n an t on the lease? S u b j e c t to t h e l eas e, yes. Yes? W e t h e n a g r e e d t o s e l l it to INP UT , the pension trust for about £2,000,000. 8 9 475 Q 10 A Yes . It w a s t h e n d i s c o v e r e d t h a t t h e a r c h i t e c t h a d m a d e a 11 m e s s of t h e p l a n n i n g p e r m i s s i o n f o r t h e b a s e m e n t 12 carpark. 13 c o m p l e t e a n d w e w e r e l e f t. 14 l o s s m a i n l y b e c a u s e it c o s t t o o m u c h t o b u i l d . 15 Cramptons bill was 16 r e a s o n s w h y t h e m o n e y w a s lost. W h e n t h e y d i s c o v e r e d t h i s t h e y r e f u s e d to fa r t o o h i g h . 17 476 Q T h e y r e n e g e d o n t h e deal , 18 A T h e y r e n e g e d o n t h e deal . 19 477 Q 20 A 21 478 Q 22 A 23 24 Those are two is t h a t r i g h t ? Y o u s o l d it t h e n to s o m e b o d y e l s e ? Yes, t h a t is r i g h t . W e s o l d it t o S i l v e r M i n e s . W h e n was that? That must have be e n about 1984/1985, a c o u p l e of y e a r s l a t e r at a l o s s o f c o u r s e . 479 Q 25 So w h e n N e m e a n H o l d i n g s s o l d t h e b u i l d i n g to S i l v e r M i n e s it i n c u r r e d a l o s s ? 26 A 27 480 Q 28 29 T h a t is w h y w e t o o k t h e Yes . That loss w o u l d have been r e p r e s e n t e d I suppose by a n e l e m e n t of b o r r o w i n g s w h i c h w a s t h e n n o t r e p a i d ? A Of course, a l o s s to ICC. 1 481 Q. I s u p p o s e e f f e c t i v e l y I C C d i d n o t g e t a l l its lending back? 2 3 A. 4 482 Q. 5 A. 6 483 Q. 7 8 Yes. T h a t is r i g h t , yes. ICC ha d a fixed charge on this pro p e r t y ? Yes. W h y d i d n ' t t h e y c a l l in t h e i r s e c u r i t y at s o m e t h a t stage? A. 9 W e l l t h e y d i d b u t t h e q u e s t i o n w a s h o w t o g e t it s o l d t o r e a l i s e it. 10 484 Q. 11 A. 12 485 Q. 13 Who actually m a n a g e d the sale? Me. Was it t h e d i r e c t o r s of N e m e a n H o l d i n g s , w h i c h is you? 14 A. 15 4 8 6 Q. 16 A. 17 487 Q. They were nominees? 18 A. They were nominees, 19 488 Q. 20 A. 21 4 8 9 Q. Yes. I m a n a g e d t h e sale. Were there any other directors No. 23 A. 24 490 Q. 25 A. 26 491 Q. 27 A. ? T here w e r e but t h e y h a d no shares in the thing. yes. Was D e s m o n d T r a y n o r one? No. T h e y w e r e p e o p l e in t h e o f f i c e . E f f e c t i v e l y y o u m a n a g e d t h e sale. under pressure 22 in N e m e a n H o l d i n g s Yes, But was the sale f r o m ICC? very definitely. A t s o m e s t a g e y o u w e r e a d i r e c t o r of I C C ? I was, t h a t is r i g h t . It w a s e m b a r r a s s i n g . W h e n was that? I w a s a d i r e c t o r o f I C C I t h i n k a b o u t 1 9 7 9 or m a y b e 28 it w a s 29 and the m a t t e r was e x t r e m e l y embarrassing. 1 9 7 8 to 1984. I w a s a d i r e c t o r at t h e t i m e 1 492 Q 2 A 3 493 Q 4 Yes . So t h a t w h e n N e m e a n H o l d i n g s i n c u r r e d t h e loss, then I C C c a l l e d i n it s o t h e r s e c u r i t y ? 5 A 6 494 Q 7 A 8 495 Q 9 Yes . N a m e l y the Ge r m a n shares? Yes, which had appreciated considerably. Did t h e y a sk for the share c er t i f i c a t e s or d i d t h e y a s k y o u to r e a l i s e t h e s h a r e s ? 10 A 11 496 Q 12 A 13 497 Q No, t h e y h a d t a k e n a lien. A lien? Yes . O n t h e b a s i s o f t h e l e t t e r t h a t I a m s u p p o s e d to 14 h a v e s i g n e d to C o l l e g e T r u s t e e s . 15 l i e n so t h a t t h e y w e r e e n t i t l e d t o s e l l t h e s h a r e 16 under the lien? 17 498 Q 18 A 19 499 Q A 50 0 Q 24 25 A right. They were selling shares which had Which I thought had been bought by But they had been bought by a company outside Yes, w h i c h I h a d n e v e r h e a r d o f you. s o r t of t h i n g Mr. 50 1 Q 28 29 I see, yes. Ireland? 26 27 T h e y s o l d t h e s h a r e s as f a r as I r e c o l l e c t , Twin L a k e s . 22 23 They sold the shares? been bought by Twin Lakes? 20 21 T h e y h a d got a Yes. T h i s is t h e T r a y n o r did. You say that when ICC sold the shares they made a substantial profit? A T h e y r e d u c e d t he i r loss b e c a u s e the shares were 70 1 2 502 Q 3 So t h a t e f f e c t i v e l y t h e r e w a s a g a i n o n t h e v a l u e of those shares? 4 A 5 50 3 Q 6 A 7 504 Q Y e s b u t a l o s s o v e r a l l to ICC. I a p p r e c i a t e that . Yes . H o w w a s t h e a c c o u n t a n c y s o r t e d o u t as b e t w e e n 8 Twin Lakes and Nemean Holdings. 9 s o r t e d out? 10 A I do not t h i n k t here was a ny s or t i n g out b e c a u s e 11 Nemean Holdings 12 therefore gained nothing. 13 50 5 Q How was the account simply lost m o n e y and Twin Lakes Just n o t h i n g happened. Did you consider whether there were any exchange 14 c o n t r o l i s s u e s s u r r o u n d i n g the p l e d g i n g of the 15 shares ? 16 A No, I didn't k n o w a b o u t t h i s u n t i l m u c h la t e r . 17 I just didn't 18 When did exchange control cease? 19 506 Q 20 A k n o w about that u n t i l m u c h later. In 1 9 9 2 ? I d i d n ' t a p p r e c i a t e at a l l t h a t t h e r e w a s a n y 21 c o n s i d e r a t i o n a b o u t that, 22 security. 23 507 Q 24 A 25 508 Q 26 27 D i d t h a t b e c o m e a n i s s u e at s o m e s t a g e ? No, there was n ever any issue raised. So e x c h a n g e c o n t r o l was not s o m e t h i n g that was considered? A 28 29 I was t h i n k i n g o n l y of C e r t a i n l y not by me and I don't t h i n k b y anyb o d y else involved. 509 Q I see. C a n I j u s t go b a c k b r i e f l y t o t h e w i n d i n g u p 71 of C l o n m e l E s t a t e s w h i c h y o u s a i d y o u c a r r i e d o u t ? 1 2 A. 3 51 0 Q. 4 A. 5 51 1 Q. 6 A. 7 512 Q. W h i c h y o u s a y y o u c a r r i e d o u t as l i q u i d a t o r ? Yes. E f f e c t i v e l y you h a d a pot of cash to d i s t r i b u t e ? Yes. T h a t p o t of c a s h a c t u a l l y r e p r e s e n t e d a g r o w t h in t h e v a l u e of t h e s h a r e s ? 8 9 A. 10 51 3 Q. 11 A. It w a s t h e p r o f i t o n t h e s a l e o f t h e p r o p e r t y . Absolutely? Yes, t h a t is r i g h t , the shares had obviously i n c r e a s e d in value. 12 13 It w a s v e r y i n e f f i c i e n t u n f o r t u n a t e l y . 514 Q. So t h a t in f a c t t h e s h a r e h o l d e r s t h e r e f o r e w o u l d 14 h a v e b e e n in p o s i t i o n f o r g a i n i n t h e v a l u e o f t h e 15 shares ? 16 A. 17 51 5 Q. Yes. A n d t h e n p a s s e d a r e s o l u t i o n t o w i n d up. But the liquidator would have dist r i b u t e d that and 18 t h a t w o u l d h a v e r e p r e s e n t e d i n t h e h a n d s of t h e 19 shareholders 20 A. 21 5 1 6 Q. 22 A. 23 517 Q. 25 A. 26 To e a c h of t h e t h r e e s h a r e h o l d e r s ? No. I was the only shareholder a f fected by Irish E a c h of the s h a r e h o l d e r s . . . ( I N T E R J E C T I O N ) ? I was the only shareholder, office nominees 518 Q. 28 29 Yes. tax. 24 27 a gain? the others were only or somebody. T h e y w e r e n o m i n e e s h a r e h o l d e r s a c t i n g o n b e h a l f of the h u s b a n d and w ife who you a c t e d for ove r s e a s A. I d o n ' t t h i n k t h e y w o u l d h a v e a c c e p t e d t ha t . ? 1 It w a s o n e o f t h e g i r l s i n t h e o f f i c e . 2 3 519 Q 4 It is i m p o r t a n t , Mr. Hickey, this clear? 5 A 6 52 0 Q 7 Yes . W h e n the c apital was put up for Cl o n m e l Ho l di n g s someone w ould have issued some shares certificates? 8 A 9 52 1 Q 10 A Yes . How many share certificates? Y o u a r e t a l k i n g 25, 26 o r 27 y e a r s ago. 11 d o n ' t k n o w at t h i s st a g e . 12 i s s u e d t o me. 13 522 Q 14 15 that we t r y a n d get Yes, I just There was m ore than one t h e r e w o u l d h a v e b e e n a s h a r e c e r t i f i c a t e to y o u . . . (INTERJECTION)? A P r o b a b l y f o r 99% o f t h e s h a r e s in t h e c o m p a n y . 16 A n d t h e r e w a s o n e i s s u e d to s o m e b o d y e l s e f o r s a y 17 o n e sh a r e . T h a t is w h a t w o u l d h a v e h a p p e n e d . 18 I w o u l d got 99% a n d s o m e b o d y e l s e as a p u r e n o m i n e e 19 w o u l d h a v e 1%. 20 52 3 Q That share w o u l d have b e e n h e l d in trust b y that 21 nominee, 22 your overseas 23 A 24 for clients? If y o u l i k e to p u t it t h a t way. B u t t h e r e so l i t t l e i n it t h a t it w a s n ' t r e l e v a n t . 25 524 Q 26 A 27 52 5 Q 28 A 29 who w o u l d have h e l d that share in trust Y o u w e r e a c t i n g as t h e i r s o l i c i t o r a n d t h e i r a g e n t Yes . I w o u l d l i k e to b e as a c c u r a t e as I c a n ? I a m sor ry , I a m n o t t r y i n g to b e o b s t r u c t i v e . ? 1 agent and there h a d to be two sha r e h o l d e r s 2 c o m p a n y t h e n. 3 526 Q 4 5 6 7 527 Q in t r u s t ? T h e y w o u l d h a v e be e n , yes, t h a t way. yes. O n e sh a r e , For the actual b e n e f i c i a r i e s who were h u s b a n d and A Yes. T h a t in a w a y d o e s n ' t r i g h t . 10 f o r t h e m all. 11 the company. 12 if y o u w a n t t o p u t it wife overseas? 8 9 A n d t h a t w a s t h e o n l y r e a s o n f o r it. S o t h a t t h e m e m b e r of y o u r o f f i c e s t a f f w a s h o l d i n g shares A in t h e 528 Q I was holding T h e r e h a d to b e t w o s h a r e h o l d e r s So t h a t w h e n t h e d i s t r i b u t i o n w a s m a d e , in which you 13 h a v e a g r e e d w a s a c t u a l l y in r e a l i t y a n e n h a n c e m e n t 14 i n t h e v a l u e of t h e s h a r e s ? 15 A 16 529 Q T h a t is r i g h t , yes. Then there w ould have been a liability, a capital 17 g a i n of s o m e sort. 18 t here was a tax co n s e q u e n c e w h i c h you d i s c o v e r e d 19 later? 20 A 21 53 0 Q 22 A 23 53 1 Q 24 A Yes, A n d you said afterwards that f o r me. W h i c h you didn't appreciate? Yes, f o r me. C a n y o u t e l l w h a t t h a t is w a s p l e a s e ? That was b e c a u s e I go t a d i s t r i b u t i o n o n t h e 25 l i q u i d a t i o n of t h e c o m p a n y a m o u n t i n g t o £ 7 0 , 0 0 0 26 w hich was m y profit. 27 d i s t r i b u t i o n r e a l l y was. 28 a c c o u n t a n t u n f o r t u n a t e l y on the l i q u i d a t i o n a nd I 29 d idn't realise that that a m o u n t e d to a d i s t r i b u t i o n I didn't realise what a W e d i d n ' t e m p l o y an 1 w h i c h was taxable. 2 t h e R e v e n u e i n t h e l a s t 18 m o n t h s 3 on t h a t . 4 532 Q. 5 A. 6 53 3 Q. 7 and tax was paid Who were the accountants...( I N T E R J E C T I O N ) ? The other s h a r eholders were overseas. Sorry. W h a t w e r e the a c c o u n t a n t s a n d a u d i t o r s of Clonmel? 8 A. 9 534 Q. It m u s t h a v e b e e n SKC. T h e y w o u l d h a v e p r e p a r e d a f i n a l se t o f a c c o u n t s u p to the date of l i q u i dation? 10 11 T h a t is w h a t B r i a n r e p o r t e d to A. They didn't I am afraid. T h a t is w h a t h a p p e n e d . 12 The t hi n g was done v e r y i n f o r m a l l y a nd I n e v e r filed 13 a n y l i q u i d a t o r s r e p o r t in the c o m p a n i e s o f f i c e an d 14 t h e y came after me years later and said that the 15 l a s t t h i n g t h e y h a v e on t h i s 16 appointing you liquidator. 17 accounts. 18 53 5 Q. 19 A. f i l e is a r e s o l u t i o n Yo u f u r n i s h e d no What happened. I see? So t h e n I e x p l a i n e d to t h e m w h a t happ e n e d . 20 I t o l d t h e m the m o n e y h a d b e e n all distributed. 21 A n d e v e n t u a l l y the y said oka y we will strike off the 22 company. 23 5 3 6 Q. T h e y j u s t s t r u c k it o f f a n d t h a t w a s th a t . A n d w e k n o w f r o m w h a t y o u s a i d to us e a r l i e r t h a t 24 the d i s t r i b u t i o n of m o n i e s w ere g iven 25 t o . . . (INTERJECTION)? 26 A. 27 537 Q. 28 A. 29 538 Q. S i m p l y to G u i n n e s s To G u i n n e s s & Mahon. & Mahon? Yes. A n d t h a t it n o w a p p e a r s to y o u t h a t t h e y w e n t i n t o 1 T h e w h o l e lo t did. 2 3 539 Q 4 A 5 54 0 Q Yes . Yes. Were there any exchange control considerations given to that tra n s a c t i o n ? 6 7 A n d that was a r o u n d 1978? A I t h i n k e x c h a n g e control didn't a p p l y to foreign 8 people. 9 their p o sition was concerned, 11 54 1 Q 12 A 13 542 Q 14 without bothering It w a s of c o u r s e a t r a n s f e r o f f u n d s o u t o f I r e l a n d ? It was, yes. D i d y o u o b t a i n e x c h a n g e c o n t r o l f o r y o u r e l e m e n t of it? A 16 No, I n e v e r did. I o n l y r e a l i s e d it w e n t o u t o f I r e l a n d w h e n I s a w this. 17 54 3 Q 18 A 19 20 as f a r as about Irish exchange controls. 10 15 They could transfer their money, I see? I c e r t a i n l y d idn't have a n y t h i n g to do w i t h e x ch a n g e control. 544 Q 21 I d i d n ' t t h i n k it a r o s e . I s u p p o s e it h a s t o b e y o u b e c a u s e y o u w e r e a c t i n g for the overseas people? 22 A 23 54 5 Q Yes . Y o u f e l t t h a t e x c h a n g e c o n t r o l d i d n ' t n o t a p p l y to 24 t h e m b e c a u s e t h e y w e r e o v e r s e a s a n d it d i d n ' t a p p l y 25 t o y o u b e c a u s e as fa r as y o u w e r e c o n c e r n e d t h e 26 m o n e y . .. (INTERJECTION)? 27 A I d i d n ' t t h i n k it w a s g o i n g o v e r s e a s . 28 Right. 29 y o u r c a p a c i t y as a d v i s o r a n d s o l i c i t o r t o You e x p l ained that f r o m t i m e t o t i m e y o u in 1 Guinness 2 a n d Mr. 3 Yes. 4 w a s a d v i s i n g al l k i n d s o f p e o p l e a b o u t t h e i r t a x 5 affairs. 6 547 Q 7 A Traynor D unne of SKC? T h e r e w e r e so m a n y t h i n g s g o i n g on. Mr. Reed Yes? O c c a s i o n a l l y I w o u l d be involved, but I don't know f o r who. 8 9 & M a h o n sat i n o n m e e t i n g s w i t h Mr. 548 Q The p oint I w a s g e t t i n g at was, effectively 10 th e r e f o r e you w o u l d have l i s t e n e d to e x p l a n a t i o n s 11 about how discretionary trusts were created? 12 A 13 549 Q 14 A n d the best mechanisms that were surrounding such devices ? 15 A 16 55 0 Q 17 18 Yes . Yes, I knew of these things. A n d you would have been familiar with trusts which w o u l d in t u r n h a v e i n v e s t e d in c o m p a n i e s ? A 19 Yes. I k n e w s o m e t h i n g a b o u t a l l o f t h i s as a s o l i c i t o r a n y way. 20 55 1 Q 21 A 22 552 Q 23 I had some knowledge. Of course? But not a d e t a i l e d or e x p e r t A l l right. Did we e s t a b l i s h who o wned Nifold Investments? 24 A 25 55 3 Q 26 A 27 554 Q 28 A 29 55 5 Q Yes . Who owned Nifold? I owned Nifold. You were the shareholder? Yes . knowledge. 1 2 556 Q 3 A 4 5 557 Q y o u so t h a t y o u h e l d t h o s e s h a r e s ? A Yes b e c a u s e the i n t e n t i o n was that if N i f o l d m a d e a profit. 9 Dolphin. 10 558 Q 11 A N i f o l d o w n e d the shares in Nemean, in t h e Yes ? A n d t h e i n t e n t i o n w a s t h a t if t h e D o l p h i n m a d e a profit the m o n e y w o u l d be put t h rough Nifold. 12 13 559 Q 14 A 15 Yes. Does N i f o l d still operate? N o t at all. N one of t hese things still operate, t h e y a r e al l l o n g s i n c e go n e . 16 56 0 Q 17 A 18 W h e n d i d N i f o l d c ease to t r a d e ? I ha v e n 't an idea honestly. I really haven't a n id ea. 56 1 Q P r e s u m a b l y c o u l d g e t h o l d o f t h a t i n f o r m a t i o n f o r us through your advisors? 20 21 A 22 562 Q 23 24 I am not quite certain but I think W h e n h e i n c o r p o r a t e d N i f o l d h e i s s u e d t h e s h a r e s to 8 19 yes. he did. 6 7 I t h i n k so, I don't think quite honestly. P r e s u m a b l y we c o u l d do a s e a r c h in the J e r s ey registry? A I a m s u r e y o u c o u l d b u t y o u w o u l d o n l y f i n d t h a t it 25 was 26 anything. 27 56 3 Q 28 A 29 564 Q s t r u c k o f f at s o m e t i m e w i t h o u t e v e r h a v i n g d o n e It n e v e r d i d a n y t h i n g . I see . S o I t h i n k t h e r e is n o p o i n t r e a l l y . 1 kn ow. 2 o f t h e t a x a m n e s t y in 1 9 9 2 ? 3 No. 4 56 5 Q 5 A 6 5 66 Q 7 A 9 567 Q 11 Y ou d idn't avail of the tax a m nesty? No, I d i d not. I see. I didn't h ave a ny r e a s o n to T h i s is m y f i n a l q u e s t i o n t o you. . If I c o u l d as k yo u to t u r n to y o u r m a i n s t a t e m e n t p l e a s e ? 8 10 Did you or d id you h ave a ny r e a s o n to avail Yes . A t p o i n t n u m b e r f i v e y o u say: "I k n e w Mr. T r a y n o r w h o m I f o u n d t o b e ver y astute. H e h a d m a n y w a y s of c o n c e a l m e n t o t h e r t h a n n u m b e r e d or lettered accounts." 12 13 W o u l d you like to e n l a r g e a l i t t l e on t h at? 14 T h a t is e x a c t l y w h a t I a m s a y i n g a p p l i e s t o E x h i b i t 15 " A . " Y o u c a n se e t h a t t h e r e f o u r t r a n s a c t i o n s 16 at A. 17 t h a t he s i m p l y o r p o s s i b l y s o m e f i r m o f a c c o u n t a n t s 18 i n s t r u c t e d m e to b u y p r o p e r t y . 19 p u r c h a s e r was. 20 himself. 21 accountants with nominee directors. 22 b u y the property. They p r o v i d e d the m o n e y and they 23 were very punctual in p r o v i d i n g m o n e y . 24 c ourse I w o u l d sell the p r o p e r t y a nd I w o u l d s end the 25 p r o c e e d s of c o u r s e b a c k to G u i n n e s s 26 f a c t t h a t m y n a m e is t h e r e a n d is o n t h e s e t h i n g s 27 doesn't me a n that 28 the t hing perso na l l y . 29 photographic memory. listed W h a t h a p p e n e d as f a r as I c a n r e c o l l e c t is I n ever knew who the He m a y h a v e b e e n i n v o l v e d i n it It w a s simply a shelf company furnished by I would then T h e n in d u e & Mahon. The I h a d a n y t h i n g w h a t e v e r to do w i t h As I s a i d to yo u he h a d a He k n e w e v e r y t r a n s a c t i o n t h a t 1 w a s g o i n g on. 2 a n y b o d y e l s e ' s n a m e w a s i n c a s e he f o r g o t s o m e t h i n g . 3 He k n e w I w o u l d h a v e a f i l e o n it. 4 a n u m b e r o f a c c o u n t a n t s as f a r as I kno w. 5 their name there; 6 f i g u r e s a n d h e c o u l d ge t o n to t h e m if h e h a d to. 7 A s I say, 8 t h i n g s h a d a n y t h i n g to d o w i t h m e p e r s o n a l l y . 9 568 Q. A n d t h e o n l y r e a s o n t h a t he p u t t h a t w a s all. He d i d t h a t w i t h He put A n d t h e n some those figures there don't imply that these F r o m w h a t y o u say, Traynor had sent you over 10 a document 11 a c t i n g as a n o m i n e e or s o m e t h i n g of t h a t sort, 12 w o u l d have done that without really being interested 13 in the i m p l i c a t i o n s 14 A. and said if Mr. I might have but 'would you please I d o u b t it e v e r h a p p e n e d e x c e p t p o s s i b l y this C o l l e g e T r u s t e e s thing. 16 only letter that 17 h a v e n o r e c o l l e c t i o n w h a t e v e r of. 5 6 9 Q. you for you of d o i ng that? 15 18 s i g n that ' T h a t is t h e I a p p e a r to h a v e s i g n e d w h i c h I A m I not r ight in b e l i e v i n g that s o l i c i t o r s w h e n 19 t h e y a c t o n b e h a l f of a c l i e n t u s u a l l y w a n t to b e 20 f a i r l y c l e a r as t o t h e b a s i s u p o n w h i c h t h e y a r e 21 a c t i n g if t h e y are s i g n i n g c o n t r a c t s 22 of t h i n g ? 23 A. 24 57 0 Q. for that sort Yes. For instance, if t h e y are s i g n i n g c o n t r a c t s fo r 25 purchase, 26 c l i e n t w i l l p r o d u c e t h e m o n e y w h e n it c o m e s t o t h a t ? 27 A. Yes, t h e y w a n t to be p r e t t y sure t h a t the b u t y o u se e I w a s i n s t r u c t e d b y 28 Guinness 29 m o n e y o n t h e dot. & Mahon. A n d t h e y always p r o d u c e d the T h e y w e r e t h e b e s t p a y e r s eve r. 1 Then the m o m e n t you c o m p l e t e d the t r a n s a c t i o n and 2 r e g i s t e r e d your deeds and h a d the m all r e a d y and 3 sent b a c k the deeds to G u i nn e s s 4 account, 5 They were absolutely reliable 6 is w h y o n e a c t e d s i m p l y o n t h e i r i n s t r u c t i o n s . 7 t h e p u r c h a s e r s we r e , 8 at all. 9 57 1 Q Yes. your account was pa i d immediately. 11 A 12 572 Q 13 A fin a n c i a l l y and that Who I m o s t of the time d idn't know So t h a t y o u w o u l d h a v e p l a c e d a g r e a t d e a l o f c o n f i d e n c e in G u i n n e s s 10 & Mahon with your & Mahon? Completely. And perhaps Yes, in Mr. completely. Traynor? T h a t is w h a t e v e r y b o d y d i d th e n . 14 People gave him millions, 15 h a d c o m p l e t e c o n f i d e n c e in h im . 16 a t o t a l l y h o n e s t m a n a n d a l s o as a t o t a l l y a b l e ma n. 17 57 3 Q 18 A 19 574 Q 20 A Yes, as y o u know . He w a s r e g a r d e d as absolutely. T h a t is t h e w a y it was. Yes . A s I say, I w a s o n l y a p a w n in t h e s e t h i n g s . 21 recollection, 22 p r a c t i c e in t h o s e days a n d all this 23 v e r y s m a l l p r o p o r t i o n o f t h e wo r k . 24 57 5 Q 25 A 26 27 Everybody As as I s a i d w e h a d a b i g l i t i g a t i o n stuff was only a I understand. It w a s a v e r y s m a l l p r o p o r t i o n o f t h e l e g a l w o r k I h a d t o do. 576 Q fo r Ms. M a c k e y w a n t s to m a k e one p o i n t to yo u a r i s i n g 28 f r o m s o m e t h i n g I as k e d . 29 E N D O F E X A M I N A T I O N O F MR. H I C K E Y B Y MR. ROWAN 1 2 577 Q. MS. MACKEY: It is g o i n g b a c k a g a i n to 3 Clonmel Estates Ltd and 4 these two foreign people? 5 A. 6 578 Q. Yes. I had misunderst ood your earlier evidence and I 7 thought that nominees 8 of the shar e s on b e h a l f of tho s e ? 9 A. 10 57 9 Q. 12 A. 13 58 0 Q. 14 N o w I u n d e r s t a n d y o u r e v i d e n c e to b e t h a t y o u h e l d T h a t is r i g h t , yes. T h e r e a l i t y is t h a t y o u w e r e h o l d i n g s h a r e s as w e l l as y o u r own, 15 A. 16 58 1 Q. 17 I t h i n k so, for t he m is t h a t r i g h t ? yes. What was the basis of t h a t ; w a s it a g e n t l e m a n ' s agreement ? 18 A. 19 582 Q. 20 A. 21 58 3 Q. 22 A. 23 Yes. You agreed with these people that...(INTERJECTION) Yes. E f f e c t i v e l y y o u w e r e a t r u s t e e of t h e i r s h a r e s ? I s u p p o s e I was, yes. But the one t h i n g that t hey d i d not w a n t was t h e i r n a m e to a p p e a r anywhere. 584 Q. 25 Yes. So i n f a c t i n a l l d o c u m e n t a t i o n r e l a t i n g to the t hing you were the m a j o r i t y s h a r e holder? 26 A. 27 58 5 Q. 28 A. 29 Yes. all the shares e xcept one? 11 24 in y o u r o f f i c e h e l d t w o - t h i r d s T h a t is r i g h t , yes. A n d on p a p e r all the p r o c e e d s b e l o n g e d to you? I s u p p o s e t h a t is c o r r e c t . I was the m a j o r i t y 1 2 5 8 6 Q. 3 I a m s a y i n g is, a n y o n e l o o k i n g at t h i s w o u l d say that the e n t ir e d i s t r i b u t i o n was m a d e to you? 4 A. 5 587 Q. 6 A. 7 588 Q. T h a t is n o t c o r r e c t . Wha t w o u l d be correct then? That I got m y share; What documents I g o t m y t h i r d sh a r e . show that the entire t h i n g was not yours ? 8 9 What A. T h e o n l y t h i n g I c a n s a y to y o u is t h a t t h e s e 10 t o t - u p s w e r e s o m e t h i n g to d o w i t h it all. 11 I am not too certain which. 12 b o t t o m there. 13 5 8 9 Q. No, B u t m y s h a r e is t h e I u n d e r s t a n d t h a t t h e r e a l i t y of t h e t h i n g w a s 14 t h a t in fact yo u h a d a t h i r d s hare of the p r o c e e d s 15 and that these two pe o p l e h a d the other two shares? 16 A. 17 59 0 Q. 18 A. 19 59 1 Q. Yes. I u n d e r s t a n d t h a t w a s t h e r e a l i t y of i t? Yes. B u t as y o u say, t h e y d i d n ' t w a n t t h e i r n a m e to appear anywhere? 20 21 A. 22 592 Q. 23 A. 24 59 3 Q. 25 T h a t is r i g h t . T hey were not share h o l d e r s ? They were not Irish nationals. I u n d e r s t a n d t h a t too, but the y were not s h a r e h o l d e r s m o r e i m p o r t a n t l y at a l l ? 26 A. 27 594 Q. 28 A. 29 59 5 Q. No. Y o u w e r e in f a c t t h e m a j o r i t y s h a r e h o l d e r ? Formally, yes. I n s o f a r as a n y b o d y l o o k i n g at d o c u m e n t a t i o n r e l a t i n g 1 to the l i q u i d a t i o n of C l o n m e l was con c e r n e d , 2 was only one distribution? 3 A. 4 5 9 6 Q. there T h e d i s t r i b u t i o n w a s w r o n g b y me. There was only one distribution. T h a t is h o w it 5 w o u l d a p p e a r now. 6 two o ther p e o p l e that out of that d i s t r i b u t i o n t hey 7 w o u l d ge t t w o - t h i r d s ? 8 A. 9 597 Q. 11 A. 12 598 Q. 13 & Mahon. T h e n t h e y s p l i t it up. Yes but that d i s t r i b u t i o n was A. 15 5 9 9 Q. 16 Yes. As f a r as y o u as l i q u i d a t o r w a s c o n c e r n e d , you were No, I never b e l i e v e d that myself. I k n o w you d i d n ' t b e l i e v e that. But that was the r e a l i t y of the legal t r a n s a c t i o n that was h a pp e n i n g ? A. 18 I d o n ' t know, Guinness 19 600 Q. 20 A. 21 601 Q. I me a n the whole thing was Yes? T h e y k n e w w h a t w a y to s p l i t it up. B u t i n f a c t a n y b o d y l o o k i n g at t h i s c o m p a n y s a w t h a t the distributions 23 a n d t h e s h a r e h o l d e r s w e r e Mr. 24 nominee who held one share? 25 A. 26 602 Q. 27 A. 28 s e n t to & Mahon. 22 29 fo r t h e s h a r e h o l d e r s ? d i s t r i b u t i n g to the s h a r e h o l d e r s ? 14 17 The d i s t r i b u t i o n that I m a d e was si m p l y send off the m o n e y to G u i nness 10 In f a c t y o u h a d a n a g r e e m e n t w i t h list w o u l d go to the s h a r e h o l d e r s Gerald Hickey and a If y o u w a n t to p u t it t h a t way. T h a t is w h a t w a s o n p a p e r ? That m a y be correct. T h e r e m u s t b e s u c h a t h i n g as a verbal t r u s t . 603 Q. There was a verbal trust b e t w e e n you and these two 1 Yes . 2 3 604 Q 4 A 5 605 Q That in fact you w o u l d o n l y . . . ( I N T E R J E C T I O N ) ? Yes . T h e r e w a s a g e n t l e m a n ' s a g r e e m e n t at t h e b a s e o f this thing? 6 7 A 8 60 6 Q 9 A 10 607 Q T h a t is r i g h t . A n d a paper transaction that didn't reflect that? It d i d n o t r e f l e c t that, T h a t is g r a n d , t h a n k you v e r y much. 11 T h e o t h e r t h i n g is, 12 C o l l e g e T r u s t e e s Ltd? 13 A 14 608 Q A n d a s k t h e m f o r a n y i n f o r m a t i o n t h e y h a v e in t h e i r possession, 16 and Twin Lakes? A 18 60 9 Q 19 A i f t h e y h a v e any, in r e l a t i o n t o N i f o l d T h e y h a v e a l r e a d y b e e n w r i t t e n to. About that? N o t s p e c i f i c a l l y a b o u t t h a t b u t a b o u t a n u m b e r of things. 20 21 610 Q 22 A 23 24 I w o n d e r w o u l d y o u w r i t e to Yes . 15 17 t h a t is c o r r e c t . Right? A n d t h e y w o n ' t r e p l y to anyt h i n g . They just simply w o n ' t re p l y . 611 Q 25 W o u l d you w rite and ask t h e m s p e c i f i c a l l y for any f i l e s t h e y h a v e in r e l a t i o n to t h o s e t w o c o m p a n i e s ? 26 A 27 612 Q Okay. Inc l u d i n g t heir accounts or b a l a n c e 28 a n y t h i n g t h e y h a v e now. 29 nothing? s h e e t s or If t h e y r e p l y a n d s a y 1 W e k n o w t h e y h a v e r e f u s e d to r e p l y t o q u e s t i o n s 2 about other things. 3 613 Q 4 A 5 614 Q 6 A 7 615 Q Yes. If o n t h i s o c c a s i o n y o u w o u l d d o t h a t ? Yes . A n d if y o u w o u l d a l s o w r i t e to A n s b a c h e r C a y m a n ? They won't r eply either. L e t us at l e a s t b e s e e n to d o w h a t w e s h o u l d do. 8 P l e a s e w r i t e to t h e m a n d a s k t h e m f o r a n y 9 i n f o r m a t i o n in r e l a t i o n to a n a c c o u n t h e l d i n . . . (INTERJECTION) 10 11 6 16 Q MR. ROWAN: I know you don't know a n y t h i n g about the 12 13 G e r a l d H i c k e y trust, 14 w h e t h e r in f a c t t h e y c a n c o n f i r m t h a t t h e r e w a s s u c h 15 a vehicle? 16 A 17 617 Q but perhaps you w o u l d ask them I d o n ' t t h i n k t h e y c a n e v e n if. MS. MACKEY: 18 If y o u w o u l d n ' t m i n d ad d i n g that to the request 19 to C o l l e g e ? 20 A 21 618 Q Okay. In r e l a t i o n to t h e d e p o s i t s t h a t w e r e i n C a y m a n , if 22 yo u w o u l d as k A n s b a c h e r C a y m a n to give yo u any 23 i n f o r m a t i o n t h e y h a v e in r e l a t i o n to an a c c o u n t h e l d 24 i n t h e i r n a m e r e f e r e n c e d to G. H i c k e y i n 25 H e n r y A n s b a c h e r & Company, 26 A 27 London? T h e o n l y t h i n g I s h o u l d s a y to y o u is t h a t I appeared before the Mo r i a r t y Tribunal. 28 6 19 Q 29 A Yes? 1 620 Q 2 A T h e y a s k e d m e to p r o v i d e t h e m w i t h a l e t t e r 3 a u t h o r i s i n g A n s b a c h e r C a y m a n to p r o v i d e t h e m w i t h 4 a n y i n f o r m a t i o n as r e g a r d s to me, w h i c h I did. 5 A Yes . 6 A W h i c h I u n d e r s t a n d t h e y s e n t to A n s b a c h e r a n d 7 8 A n s b a c h e r s i m p l y d id not reply. 621 Q 9 Yes, I u n d e r s t a n d t h at . B u t t h i s is a d i f f e r e n t inquiry? 10 A 11 622 Q Okay , i f y o u w a n t m e to do it. T h e a c c o u n t n u m b e r in H e n r y A n s b a c h e r & Company I 12 c a n g i v e you. 13 i n f o r m a t i o n t h a t A n s b a c h e r h a v e i n r e l a t i o n to a n 14 a c c o u n t r e f e r e n c e d to G e r a l d H i c k e y or 15 Clonmel Estates? 16 A 17 It is 1 9 0 0 1 7 - 1 0 1 a n d a n y o t h e r T h e y w o u l d n ' t h a v e a n y t h i n g o n t ha t . They never h e a r d o f it o r s a w it. 18 MS. 19 MACKEY: are s o r r y to have kept you 20 f o r so long. 21 22 A T h a n k y o u v e r y m u c h f o r c o m i n g t o me. 23 that v e r y much. 24 MR. 25 T h a n k yo u v e r y m u c h a n d we ROWAN: I appreciate W h a t w i l l h a p p e n is t h a t we will get this 26 t r a n s c r i b e d and we will then m ake contact w ith you 27 a b o u t a r r a n g e m e n t s to h a v e it s i g n e d b y y o u w h e n y o u 28 h a v e c h e c k e d t h r o u g h t h e c o n t e n t s of it. 29 1 2 3 again. A. I gather that you then send some statement of what 4 your report will be to the person involved? 5 MS. MACKEY: 6 our investigation. 7 8 That will be phase two of is set out in your letter. A. 9 That That is down the road. Yes. MS. MACKEY: 10 Obviously we will communicate with you again 11 but that is going to be some time in the future, 12 Mr. Hickey. 13 A. Yes. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED ii A 0 (?567 ?aria/M7 . _o ?0?ng b,ch r* I, Gerald Hickey of 66 Merrion Village, Ballsbridge, Dublin 4, retired solicitor, make this statement for the benefit of the Inspector’s appointed by order of the High Court to Ansbacker (Cayman) Limited. 1. I acted as a solicitor during the 1960's, 1970’s and 1980’s on behalf of a number of people who had business with Guinness and Mahon and I was also a personal borrower with Guinness and Mahon for a number of speculative projects. 2. I have long « retired. I am in poor health and I have no files or records save in respect of one matter which happened about 22 years ago. I learned much later, about 2 years ago, that I was liable to capital gains tax on the distribution of funds on the liquidation of a company. This matter has since been reported voluntarily to the Revenue Commissioners and tax has been computed and paid. 3. My share of the above distribution was placed on deposit with Guinness and Mahon and I always understood that it was so. I withdrew the money about 18-24 months later. I have no knowledge how Guinness and Mahon dealt with my deposit internally. If it was placed with any offshore entity, it was without my consent or authority. My interest statement received was on Guinness and Mahon paper. Such statement (one p,er year) were immediately sent by me to my accountants Stokes Kennedy & Crowley (now KPMG). I did not retain copies. 4. My name appears on documents relating to College Trustees Limited, tf I signed any letter to that company, I do not understand why and haVe no recollection. I say that I have no knowledge or information whatsoever relating to that company. 5. I knew Mr. Traynor whom I found to be very astute. He had many ways of concealment other than numbered or lettered accounts. He could remember the.most intricate dealings and would, at any time, be au fait with any matter on which I dealt with him and would put the name of the solicitor/accountant who acted in any particular matter down in case he had to check the details. 5. I acted as solicitor on many transactions forwarded*to me by Guinness and Mahon. Invariably, the purchaser would be an Irish registered shelf company. I would have had no knowledge of the beneficial owners but would be acting on the instructions of Guinness and Mahon. I would be instructed to sign any contract in trust for the purchaser andwould complete the purchase in the ordinary way for the purchaser. I would be instructed to act on the sale and to sign the contract in trust for the vendor and complete the sale in the normal way. Guinness and Mahon always provided the money. 7. I have seen the term “suitably secured” on some of the documents recently received from Guinness and Mahon and would have assumed that it meant many other situations other than a “backing situation”, e.g. property security, orpersonal security. I beg to refer to some documentation recently received from Guinness and Mahon: (a) Document A: I have no knowledge or information relating to this matter. “J.D.T ” obviously refers to Mr. Traynor. ( (b) Document B: I can only speculate what this matter refers to. I can only assume that this includes the full distribution of the transaction referred to at No. 2. After deduction of expenses etc. only a l/3rf interest approximately was owned by me. If it is other than this, I have no knowledge. (c) Document C: I think this refers to a profit from the sale of premises in Grafton Street. It is prior to the imposition of capital gains tax. I do not know what the reference to the "Gerald Hickey Trust” is and I have no knowledge or information to such a trust but it may have some relation to my interest referred to at (b) above. (d) Document D: Twin Lake Investments Ltd. This was my own company registered in Jersey and had nothing to do with Guinness and Mahon. (e) Document E: I have no knowledge or information relating to the stock referred to or to Mars Nominees Limited or to Account399 Twin Lakes (Jersey) Limited. (f) Document F: This may have referred to a sale of property to Irish Life. I have no memory of it (g) Document G: The matters here refer to me and I presume tax was paid in the normal way as the statements of interest earned would hav»been sent to SKC at the time. (h) Document H: I have no knowledge or information relating to this. (i) Document I: : I have no recollection of signing such a letter to College Trustees Limited. See my reference to College Trustees Limited at No. 4. Twin Lakes (Jersey) Limited was the company in which I was involved. (j) Document J: This was about the time I was developing Dolphin House. Borrowings in relation to that development were transferred from AIB to ICC Pic. ICC wanted a lien on the property and on some German shares (referred to in the document). These shares were purchased offshore through Guinness and Mahon as part of the overall deal. Dolphin House lost money for ICC but the sale of the shares made a substantial profit for them, reducing their loss on the property. « ■ Document K: I have no knowledge or information relating to this. I did not have an Ansbacker account as far as I was aware, neither did Twin Lakes (Jersey) Limited. I have made this statement from memory and I believe same to be true. However, the matters referred to happened many years ago and may suffer from the normal defects ofmemory. Gerald Hickey Reported Details "lull I J.D.T. 918. I Gerry 7 Hickey. J.D.T. We shall shortly receive £290,000 for deposit in Cayman. Agreed that we will make available an overdraft facility of £90,000 on a back to back arrangement. Friction will be lj%. uul. J.u lucxey . 261,306 -, 233,382 31.3.75 Suitably secured - excess due Boamdnun rh- Gerald Hickey 30.6.72 Suitably secured. Gerald Hickuy si 108,372.43 100,000 . . i 1 16.U . 72 . . . Sui t a b l y secured. - . i GUINNESS & HAHON LIMITED . •'r■ APPENDIX 70 B Loan. 8alance Outstanding at 30 April 1978 • Borrower • Oepostt' Offshore Cayman £ I - •• 604,878 59S,000 450,000 X J,179,486 350,488 400,000 350,488 230,000 Gerald Hickey -X 416,467 211,018 199,556 211,018 199,556 264,867 125,000 147,967 125,000 ' 124,449 113,648 108,447 I. V K 61,488. 118,904 69,035 604,878 •595,000 - 450,000 X Guernsey £ • , V 124,449 113,648 108,447 , 61,488 43,000 : 25,000 9,259 9,269 5,002,000 2,481,614 + The bank holds additional security In respect of many of the above loans. Document No. 15 1,317,594 NOTE : References herein are takenfrom the Bank Statements of Guinness & Mahon Jersey Trust Limited File Name: - Gerard Hickey 20.12.73 9.1.74 26.8.74 Twin Lakes-debit Cheque-Gerald Hickey Trust Twin Lakes - debit (amount not known) £375.00 £75,992.96 NOTE : References herein are taken from the Bank Statements of Guinness & Mahon Limited - Jersey Trust/Trustees Account File Name : - Gerard Hickey 16.11.73 14.1.74 15.1.74 Gerry Hickey Trust re. Grafton Property-debit Filing Fee for 1974- Twin Lakes (Jersey) Ltd. Twin Lakes Investments Ltd. - debit £998.00 £50.00 £80,000 NOTE ! References herein are taken from the Guinness & Mahon (Dublin) Limited of Securities held for Guinness Mahon Jersey Trust File Name: - Gerard Hickey 1982 150,000 Eire 10.5% Finance Stock 1982 N/O M a n Nominees Limited Account 399 Twin Lakes (Jersey) Limited Amount; N o. 1. No. 2. £2,949 £201,366 Term: Extension for period of one year to 31/12/78 Rate: 9i% Fixed Drawdown: Already taken up In the form of Loan Accounts Security: "Suitably Secured". Recommended. NOTE : References herein are taken from the Ansbacher Correspondence files File Name: - Gerard Hickey - Twin Lakes (Jersey) Limited 15.1.90 19.1.90 2.4.90 29.6.90 12.11.90 Geny Hickey Twin Lakes (Jersey) Limited Twin Lakes (Jersey) Limited Twin Lakes (Jersey) Limited Twin Lakes (Jersey) Limited £5,000.00 Stg.£2,000.00 Stg.£2,50)0.00 File Name - Gerard Hickey - Jersey Trust Special Account 4.7.75 Refund G. Hickey ?300.01 File Name : - Gerard Hickey 9.4.84 Letter from Gerard Hickey to College Trustees in which he confirmed that College Trustees Limited should give an undertaking in a specified form to the Industrial Credit Company Limited regarding securities totalling approximately DM.600,000. J r \ NOTE : References herein are takes from the Twinlakes correspondence file File Name : Gerard Hickey .4.80 15.4.80 22.4.81 9.4.84 9.4.84 19.1.90 17.10.90 Account opened - lodged Counterfoil for Government Holdings o f £150,000, on which interest o f £7,875 was payable Account opened - lodged Letter from Gerard Hickey to College Trustees re. Twinlakes Jersey Ltd. He confirmed his wish that they should give the undertaking iii the attached letter to the Industrial Credit Co., Ltd. Undertaking from College Trustees Ltd. in which they confirm that they have purchased a list o f securities for Twinlakes Jersey Ltd. The shares purchased are as follows 840 shares in BASF at a cost of DM.150 540 shares in Deutsche Bank - cost DM. 199,530 230 shares in BMW - cost DM.97,865 825 shares in Bayer - cost DM. 150,645 Letter from Ansbacher Stg£2,000 to Twinlakes from Account 602 Letter from Twinlakes, Guernsey requesting that their account 476608 be closed, there is a reference on the letter to CC401. IR£7,875 IR£7,875 y A * , a ■f ' y J / NOTE : References herein are taken from the Tracing File Name : - Gerard Hickey 26.10.90 Ansbacher 01354602 Account Twinlakes, Jersey - It had opened an account with Guinness & Mahon on 15.11.82. On 26.10.90 IR£11,900 moved to Ansbacher 602 Ansbacher 03154602 Account < 22.1.90 21.2.90 2.5.90 24.5.90 J* K • :• :.r / • - C V.rvJaGPgr .;■::*•■•••• ••- -‘r r ^ T : ■J-'~~ ■ ' :<-. '. ■ ■■ ...• . :■*•< -,f : . , V-i ■.•••-. ■/.. .. r—• -'■i ^^VjtfJUKu i—>. .:■•:..-..;__ .r...____ ^ -tv.i.JT.--.■■_j-.j'x-C J-.i/A-e iK iKuf;'** ui:*!c im \*ttu*JSVt££ __________ . . •• •, g ■ ,*• t. > IJ • . , «**'!• • -• . w* ~v'v Tr-'-ivV .M r M W ^ W V i l • GERRY H IC K E Y .; « . . .• .j *" ............ •_ . ' ijf! . T-^r- - r . ----------------- :-----:• 11...^».-. ■ • - ........ — r .r v . . :•'• ••• ‘Jvr ■•:■! .;JT-v- —7,« -:■•-•<’• v -5..-»•• .T-"•• r-.....«Y. j*. .-•'£ i • CHEQUE £ 7 0 , 2 1 5 . 2 99 tt oo », Ru f o r one m onth, • --:•••; - • be v cri ■ •■••■•• •-• - / !r ■ ••• phqne Y; % '\ ' ” ' ' '*■ / ' ». • . / . •.' •• •« • . ■ . * . I - »\T . ■■.■' •••- \. _ «._. . ____ . a, *•.•> MftM *• . .•« .•* ..'•«*• . * ■•> * •» . '.ir -.Hfcfrx-W.'V•*:• ;£ * '■bU-. Jiftt i.. i ■ a .. . .. j. . . . . v. ............ « IB* m .«/ V***« • • ______________ ♦mc .A Uhf - * ................. **4*1+*$*!* •/ n > ■• , G .k ic k 8 y ? in . t h 8 ' ' m ^ H r i g T y ^ h ; t b 8 j ^ ; * - , y ----------T . - , ’ *e?sw . • .*, , ,t «*vtv. • sr••%>;* —«&•• « ; •»„••• • .*■ ' i ^ to y&^grS ;vo. -t*.-VT^V m t Q V X /A /^ e r e /.a n d c . d ^ ^ • • . .*• . r a t s a p p lic a b ls . jfo .'* c * .r '•UA .. ......... .*. -vr., s '*••l»' »•..r •at .... «•*.•,•*•••* -£Vr*• ‘*.• v %* •- • . ,•••»..• ....... . ••; » •* • •• • .Vs « » • « ft 1vV . . „ ....... .... •j-.v.Vs.vr-v:?'::•;:"V :-.-V z \';T7t r ' V.•.r•-1(.-7 ■.4*-. ■• —...:* *• * .. *•*’.' t • •• j ■ " .■ . .’ . 1 . * ..■ _ . . . *.« .%-••; .•'t-. A-.-.-. « f v - 7v -: ■■*■••• •■ •■••■ • " ; •, • . ‘‘r j - i ’.W';•■'“ •"• '•: . ' . . .. ............ . : h; - -•■«..,••-.•>»■■•.'•- . * mi • '. •" •'*' 'I*. Sv^t-»««SA6 J*. M" \ f * 'f ' ' , ■&■ fcn » * l* n ?* W * * ’ *' * • . i . •: 1 1 > • (, . • * *• ' ,• . ■• -"' * » I ‘d * . : ,, . ,>, i».•• , ** ** * . . ,7* ' 3 1 ^ i ^ e j i f J k ^ W ... - ...................... j ................... -rr-> ■t: •■.■•. ' * * * . ■•— .•: . . j . . _. ^ ^ _ .. J ..* h i-.Srtj. .4 ... 11 • v •- ' 7j . rr •• .. ........ * Mo.' A » W * . M W M . ... y . . •> J. • din ■■ nl-iirfA Iili 11irfn — - ■S’& bsek.’s/ifiM.JS w s b i 1 ™ . . %;... r-“- ■*** •••• .. ■ v .j .V v >*• j ■." •:f:.«r:2^ • .- v . r e■>hinirrt ' m « ^ " w < w: i » .1 v?rer' e fiB M M ■M B .«, '<*•' * ' , **• * f m \ *5vl« 4 «• / •»*»•«/*•• *,-• ••••rf*, • • * .• £ • * '• > " W 't ' “ '*• * ^ ‘••’m . i * .......................... .V. . . i . _____ A'Pmndix?x? Share Certificate Mo. 3 dat«kt 21at February 1974 covering 9998 aharea in Crane Bolding* in naaa of Nifold Investments (Jersey) Limited. ' I confirm having received the above Share Certificate from Guinness ft Kahon Ltd, 17 College Green, Dublin 2. mmcmi 'y a m inniii M M M Mtff c m cram h i t i m ic s t tw in •iJW mss c m in C M onr m c m i irmurt . nii-iwiT-ioi BO W»n I m m n tn *!* ^ m in o t * X m rn n M Change of AddfMS -V. v* Henry Ansbacher & Co. Limited MRRMtMMM NaUrfaWM STATEMENT OF ACCOUNT fZ = 3 c T rvat O rovp >•410665 FKtM»«Q9fl4«62S7 T e l e f a x Frtmt To; W o o . sattm obtn a * i u s w teUfa IBtamwtinmhil Bank - Dublin,Iceland Attention: ms. okubb v a m - a m FBX No: re 011-3531-67M-034 22 SepUnfcor 1994 m a^wLfC fr wSSS. v^ f »s» “ Jy * Would jfcmpIeUBUBUteSTa l2^JOQO>uWtow* LLOYDS BANKUMTTHD Itaed 1DD 79 London Accounts Q tS dsqf Son Code: 30-948*1 Account No. 0329953 iM it onr acooum aunter 02/01087/11 OuT W y, Hnn«M,e*tewWirttahVlfjhlltwai 3b/o>*? ■Ti( Al( ' Reported >18. / Gerry J Hickey. / ' ’ J.D .T. Details Ye shall shortly receive £290,000 ior deposit la Cayman. Agreed that tre will nake available an overdraft facility of £90,000 on a back to back arrangement. Friction will be l i % . f¥ t 6 ( i £ . y c< ft ,Ck.;s 17. COLLZC Z G.*.2SN. SSI . „ 3C SLIN , 2 . . •»*<• • , «. • *l %..•» « * » s , P. O.ZQX 53A. .*n * 7 \ , r ? T * i» 16th November, 1971 Our ref. ^0 ' D :e\v •• ) .y - Ge r a l d Hickey, Esq. , 28, S h r e w s b u r y Road, Dublin] ■4. . / .V i D e a r Sir, F u r t h e r to your c o n v e r s a t i o n w i t h Hr. Traynor, v/e w r i t e to c o n f i r m that we are p r e p a r e d to make available ~o you, f a c i l i t i e s to the e xtent of £ 1 0 0 , 0 0 0 (one hundred t h o u s a n d pounds), subject to the f o l l o w i n g conditions: 1. a l l funds b e i n g placed at your d i s p o s a l to be a v a i l e d of b y y o u in the form of a L o a n A ccount, 2. t h o u g h repayable^ o n demand the f u n d s h a v e been m a d e a v a i l a b l e to y o u for the p e r i o d of t w e l v e m o n t h s after w h i c h time t he p o s i t i o n • w i l l be reviewed, w e p r o o c s e to ch a r g e interes-i ^ t a fixed rate of 9< %. Inter e s t w i l l be c a l c u l a t e d o n a q u a r t e r l y basis and w i l l b e c o m e d u e o n the • 3 1 s t December, 31st march, 3 0 t h J u n e a n d 3 0 t h September . • • . / The c h e q u e for £ 1 0 0 , 0 0 0 d r a w n by y o u and paid in at the H u n s t e r 5s Le i nster Bank Ltd., D a m e Street, h as t o ­ d a y b e e n d e b i t e d to the new L o a n A c c ount. Meanwhile, we s h a l l be o b l i g e d if y o u w o uld be k i n d e n o u g h to s i g n and r e t u r n the a t t a c h e d copy of this F a c i l i t y L e tter thereby c o n f i r m i n g your a c c e p t a n c e .of the ter m s a nd conditions . c o n t a i n e d therein. Yours faithfully, for C-UIN2JESS & SIAHON LTD. A ppendix XV (56) M r Jorge H ine & M rs M argo H ine 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Jorge & Mrs Margo Hine. a) Letter of 24 December 1986 from MJ Pender to BA Ursell. b) Guinness and Mahon schedule re hypothecated loans as at 31 January 1988. c) Guinness and Mahon memo of 10 December 1987 to GMCT. d) Schedule of GMCT balances prepared by Mr Padraig Collery on 19 October 1987. Brace : A t requested I list hereunderpartlcutsrs of the Accounts for which we hold backing deposits from OMCT : a) Non Resident Accounts ( which arc Included in the full * et-.:«ff category for Central Bank Returns : ‘ JA M Mine 101,000.00 % I 1 i iso £9 toin u n s m 0009 *•* 0001 ^T*od«a Ct M9 P 0003 m oi m t m H f t t U fW M .m i a i m a i n i m a u **w i wvmm mmX9D n \ TO: G .M .C .T . date: 10th D e c e m b e r , 1987. TEST: A tte n tio n : s R e: ^ M ike S h ield s. J o r g e & M s. M argo H in e L oan U ,S .$ 1 0 0 ,0 0 0 A b o v e lo a n w a s red u ce d by U .S .$ 1 ,0 0 0 . M atu rity d a te 2 1 st M ay, 1988. T ru st y o u w ill a g r e e w ith a b o v e p a rticu la rs. R egards: P a t O 'D w y er. AUTHORISED BY: DEBIT: COST: FILE: In te r e st r a t e 18% fix ed . CfiTt ■ l6 a a i Vo"!!. ".3-0F bxU.4« eUD' „..••» asaa. . ' cpw* ” * ipiiMimir IHT i ww i U t e . taai 07lt0ai7 Hint “ ““ USt “* * Idoioooyoo I (jA fiL rv^ c o t. aAX. V*n 6 L C ^ €fl^ '^ ^ v ^ r ^ o io D v ^ c x v * v eV w^ o < .V ■ VA*7‘ A ppendix X V (57) M r Denis A Jackson 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Denis A Jackson. a) Sehedule of names supplied by Mr Stakelum with his letter to the Inspectors of 21 February 2001 b) Letter of 15 January 1990 - Ansbacher Limited to Guinness and Mahon. c) Letter of 25 June 1990 - JD Traynor to Guinness and Mahon. d) Letter of 17 January 1990 - Martin Lanigan-O’Keeffe to JD Traynor. Name. Denis Jackson. c Ofhhora Back to Back loan. Data Dapoaii Opanad Data DapcMtt Ooaad Yet No. Mid 19601. c. 1987/M S u m sTFuids Offctora Source of Fund* litah Pounds. 42 Fitzwilliam Square Dublin 2. 1V>1: 765144/763065 Fta: 612035 P.O . Bob 887. G iand Cayman, B ritkh V « t India* Phone: (809) 949-465V4 T rie s: C P 4305 Fan: (809) 949-7946 (809) 949*3267 15th January, 1990 M. Lanlgan O 'K eeffe, E sq ., Managing D ire c to r, Guinness t Mahon U n ite d , 17 College Green, DUBLIN 2. Dear Martin, you please arrange to le t ne have a S te rlin g D ra ft in the Stg.£5,000 payable to Denis Jackson and d e b it Ansbacher Account Mb.13154602. C b u ld bur I would lik e to c o lle c t th is D ra ft cn Wednesday nam ing please i f po s sib le . Yours s in c e re ly , J.D. Traynor of __ € o l£ a * o A M to tb tr a f tk$ B tn rj A iu b td k ir H oU b tgi K C JM w tM f jR n M ^ O rnjp> Pleatereplyto: 42FilzwflHtinSquare, Dublin1 Tri:765144/763065 Pax;612035 P.O. Box W, Qnad Ciymw. fettk W a his 1> •' t{V:- «J, ' - • ■ ; rv3r a :* # -* ;• 02 3 MARCH 1981 6 h OUBLIN ATT L0AN8 DEPT /iiX■■/•' -i • REF WILSON BISHOP. TOLLEY BACK TOT BACK LOAM •• $ •V ; ') WE HAVE BEEN ADVISED BY HR TOLLEY THAT HE HA8 NOT RECEIVED THE LOAN Vc >v AGREEMENT FOR SIGNATURE. I PRESUME THIS REFERS TO A NEW BACK TO,.;.\ r \ . BACK LOAN. IF NOT ALREAOY SENT COULD YOU PLEASE EXPEDITE. •',»■•».' r. 6U1NNES8 HAHON CAYNAN TRUST 23203 HAKB El 4303 6NCT CP E ■ y 4< S& .: ■■■ i* fijt c C . TOLLEYt MELBOURNE r A U S T R A L I A . GUINNESS+MAHON LTD DUBLIN 6.3.Si. '1LA P / L .'f THAT A F A C I L I T Y L E T T E R OUTL INI NG TERMS AND CONDITIONS LE TO NEU LOAN I S B E 1 N 6 PREPARED AND ULL BE FORUARDED TO iJE COURSE WITH GUARANTEES FOR SIG NA TUR E. FUNDS H I L L B E RON COMPLETION OF NE CE SS ARY DOCUMENTAION AND LODGEMENT OF . FUNDS WITH G . M . C . T . ■ o f ^ ' D G. M. C. T . OF THE POSITION.: . YER i i 08* *,33127 • ATT I P.. 0* DWYER REi * • I LOAN TO JAMILAP/Lt MELBOURNE. ■'•f? REFERRING JfO MY-.LETTER 15.1.Si REEAftOINfi THIS SUBJECT HE .SHORTLY. BE-REPAYING EITHER UB OLRB 30i000 OR 100(000 DEUTSCHE*;.' HARKB;rfFVR»RMERLpAN8. TRUST YOU ARE PREPARIN6 LOAN ASREEHjENT-. A N D S W P Q U I N E DOCUMENTS FOR DEUTSCHE HARKS 2601000 LOAN JOj*^;^ JAMIL RELEASE ' .V.re w ,M ACCOUNT.UJTH N.B. of AUSTRALASIA LIMITED. ■ ' *<; ’ i » REGARDS McAt#mvic frfptc& PAT ■0‘OUfCR** ‘'«•"»s*;V***■ .. • r. •-'»*ff4«' :iSw»a •s ^ w 4303 6MCTCP 23203HAR8 El • i^ S W w 1 •r . 1 '■• / i lU ^ W M IM D J iT w yrttfOW M H O rX O IM f ft C Q jPB U ffl.^ r... Daar Mlk*» '-■*-w.wf" , __ _ . .. _ w>*» •*%■««>>* **+ > ••# 4 __.. ...--- •-- - — ■-- ——— ■.••'r^.;Se-\ "’^&3SSS :W-^ &*.♦■*■' :.' *' ******’ -•-’* - ;y:? -----,v,^>.•..—'' *— ••••^awiwp t .ii lir to ourraoaat in enclosing a) . r.f . y*ir*vw*' ;r-V'jM *:A «•.••&•«*- inception to d a tt. M Coptaa o f tha tiro loan aooauntaln tha nana of W ilson Bishop Tollay Pty Ltd. from January IS ii to dateT. .; In tha oaaa o f Jamila Proparty Llmijtad, .1 hava xaoalvad ach aq u a. raqaaatlng.Intaraat dabliad to tha acoounton tha SOtbjuoa, tha oradlt bacomaa payablaoh tHaJOth BapMffiSw/-:Slak I^oiiijba and 30th r5 • »"•: ! / V . ' a ' ^ s *’ ; ii^, .„ 4* . • • “ *..... •4^.. .w-.r W llaon W ahop^IdLlayPtyUiiatad h i Slat March ttwr» ■iamty, •.• ''?i,vW .’. " ••' -'tv. ,•• -.... ,j... •;-*»- . . •<■'— •■■••:■ :■> ......... .................... . ■----- »- • .'• ’• J s . . . . . j . . ‘" ^ -^ ^ 6 • . . •...'.•- . ■>■'■■ v.-:-. ,.., 4•.■al r-:V / ;■*• .' - t - -.•■■ Z. , .• ... ■ UTSSSES? ..v li • , .-S*. ■ •%Vw> ■•*‘.%v \* * *'v ■. <-« **vr;^y PatO'Owyir ■ ■. *'»■..-•••-?":.•-'iW & Cf. .•.«.* v ■<»V* -^.•VVy.tw• '. . \ '* f ' « .. . • ■*■••». ■> i '.^^■.•••.•■••,‘i’r* • £ * .* • r*1. ■^ ..' ,•• "• • 'j» ^ t.yyy .. .. /*.*., -v' *• A , *k’ ■•• -«r .. •■ *■•• i.*- •• '^rjfkr.ju ■ * * • , . ‘^‘■*■^1""t?.. *.r*■**. t % .' » /• *> ••• , • t .' . •••*•*• • . . •„* ' ' x\ •' • ■ v*;f :• ‘ . ' • • • . • ••£'■ •«■..■.. . r . — » it - • > * » . - r:- • tfM.ir.'.v'fTy .'. . . *»' • • •• •'4* *• • -J.... - ' . . . . ■•• ■ •• - •■ . - . • ■• ....... Vw . ■.v 1---, ■ . ’*V ^r"»■Vffi>r^£•>*?£%<*»***■•■>*.■■ .'*, . '■ * *..• --- • ♦ • “. • * • ■ • • * V* >■*.»;.»• "»* . ■ **• .... ... Jv4-‘! .. * • • .,j•"• •*.y^awi «m w — • >> 'i»i ». 4p un wi**%yj iau»y**»r---*•■•••»•»**,uw . • .,'f".' Ijpitajiy,mn ywr» .Li,*,. ' ----- - -r^Qjrffr-mawi - ***---. --'•#* •----•------. ;—•# .-'"' — ----- y •••«•.***«* --tnt»f •* ■ y^'Vp'- .*.’ •»*» . <■ w ♦ • -v: ■'.rv; JtankingrManager . . .■•• . , . . . J.S.: • -I I »'• • »► ■ ..'. — v ..;, ..w :.\•»,.. ••- .. *.■■ i V' ^UNKEBS Jim) C 2nd December, 1981. t/Gr Ref: PO'D/SC Mr. R. H. Tolley,' Managing Director, Wilson Bishop Tolley 4 Co. Pty. Ltd., 628-630, Bourke Street, MELBOURNE. VICTORIA 3000 Bishop Tolley & Co. Pty. Ltd., J5™ il5-Pr9er!§to_Li5!t«d________ Dear Mr. Tolley* I refer to recent correspondence 1n connection with the above loans. As the loansare now proving inconvenient to us I shall be obliged 1f you will (. kindly made arrang«nents/£o repay the outstanding liabilities. Sums of «t230.M. 30aT?70r1& and U.S.tMil35.-99’ will be required to repay the capital sums plus Interest as at 80th December, 1981:' The anounts In question should be paid Into our accounts at Deutsche Bank A.6., Postfach 2631, D. 6000 Frankfurt (Main) 1, Account No. 932 6935 and Manufacturers Hanover Trust Company, International Division, 4 New York Plaza, N.Y. 1100 15 Account No. 544-7-23776 under advice to us. The above figures have been made up as follows r Uot>*>c Wilson Bishop Tollcty & Co. Pty. Ltd. D.M. Loan • if/V' 11*1 V I J i ftf 99 Interest to 89*h December . Wilson Bishop Tolley ft Co. Pty. Ltd. U.S.$ Loan Interest to W * h Paaamber r it&t. &*■ o 01,664.74>461fH* t c/Jfy. V/ «9 t p f ‘"r . w Jamila Proprietary Limited D.M. Loan Interest to 2Qtk-Deeember 260,000700 a,7flii#5 *341 Yours sincerely* F*at O' Dwyir MAJfcMMMfc II MH> 1 m*e flubMa*9m OeMMftJb d AfuL — - MiNMM& AmA & A ppendix X V (60) M r W illiam Kearney 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr William Kearney. a) Letter of 30 June 1976 - TR Leonard to GMCT. b) Letter of 30 June 1976 - TR Leonard to Mr Frank Lee. c) Letter of 8 July 1976 - GMCT to Guinness and Mahon. d) Letter of 17 December 1976 - TR Leonard to William Kearney. Correspondence received from or on behalf of Mr William Kearney. a) Letter of 10 October 2001 - Barry M O’Meara & Son to the Inspectors. r s • w Our R lfi TRLiAB 3 0 th . Ju n e , 1976. J .A .F u rz e . E s q .. ^ S ulnness Mahon Cay»an T ru st L td. P.O.Box. 867, Grand Cayaan, BRITISH WEST INDIES. O tar Jo h n , A lto e n c lo se d Is a copy l e t t e r f r o « Frank Lee d a te d 2 9 th . J u n e , 1976. and I c o n f lr a having a f f e c te d a l l t r a n s f e r s as I n s tr u c te d fr o * h e re to -d a y . C o n se q u e n tly , -th e Monarch P ro p e rty lo a n s have been d is c h a rg e d 1n f u l l and th e G.M.C.T. '« • s e r i e s 1n s t e r l i n g d e p o s its have been e lim in a te d . A b a lan c e o f $127.90 now r e a a ln s on a 6.M .C.T. •W* D o lla r D e p o sit a c c o e n t I opened to f a c i l i t a t e th e s e t r a n s f e r s and p erh ap s you would a d v is e «e a s to th e d is p o s a l o f th e s e fu n d s In due c o u rs e . Kind r e g a rd s , s Yours s i n c e r e l y . tTirrm . r . leoitxro nrx ....— MANA6ER ACCOUNTS. \J F ran k L e e , E sq .* W estb o ro , M ontenotte, CORK r s : M onarch P r o p e r ti e s L t d . , . D ear F ra n k , . I th a n k you f o r y o u r l a t t e r d a te d 2 9 th .J u n e , 1 9 7 6 , e n c lo s in g ch eq u e In th e .sun o f S19,068* 70 to d i s c h a r g e . . th e Monarch l o a n s . ' TRe d o l l a r t r a n s f e r s t o In .H o u s to n and t o C .J . and A .M .C o llin s 1a Hew York have been e f f e c t e d a s r e q u e s te d . ■ • . I '- i « :-% b-day:.o^nd1'ng-a -'d ^aft 1n t h a su « o f J 1 7 , 0 1 8 . John f u r z e f o r c r e d i t t o an a c c o u n t 1n t h # n a « o o f * M illie * ^ . Y ours s i n c e r e l y * - T.K.LidMXRD MANAGER ACCOUNTS. eze ' o o e o e o / ' i o / z o o / ’o • G UINNESS M A H O N CAYM AN TRUST LIMITED AUwntMrof UwQuImmmMahonItoretant (MklntOtoup RABoa M7 araMtCnrman GsMfcAOu l mMM SrttWilMMtindiM 8th July, 1976 yourio( ourraf M i o b 7 . R. Ia a r a r d , fln liw a o * M x x 17 CoUagpi Q c m Eaq. i L iad tad m n a u ttp Osar Ha, i • woa ffar v a a r la t t a r o f 30th OUna 1976 an a l owing cfcadc fear ' X h a w a ls o U quddatad a l l th a "N* S a r ia a S ta c lio g d q p o a its. NLth ragazd t o tfea o u tat t ndtoj c x a d it o f 03 61 2 7 .9 0 p la n * tr a n a fa r t o GM London t e a o r a d it t o c a r 7 IVB UB D o lla r a o o cn x t. S ta c k in g y o u in t h i* n a tta r . Youra ain caraty, wirnmr. . u m a n Our Ref j TRL;AB 17th* OKMriMr, 1976. ■ + Ml 1.1Ian Kaarney, Esq., Dear Mr. Kaernay, . . At the request of Sulnness Hihon Cayman Truat U altad I enclose herewith cheque In ttw sun of £10,418.10, repraaantlng U.S. , Dollars 17,398. 23 a t 1.67. I should ba pleased If you would kindly acknowledge receip t of th is cheque by signing and returning tha enclosed copy of th is Yours sincerely. -T3C ACCOUNTS. . r it?. B a r r vV M . O 'M e a ra & Son S O L IC IT O R S O u r Ref: JAP/COK/PUQ121/8 Y our Ref: C/K13/N SPM 18, South Mall, Cork, Ireland. Tel: (021) 427 3305 Fax: (021) 427 4693 D .X . N o . 2059 E-mail: bmom@securemaU.ie Ths Office O f the Inspectors o f the High Court Third Floor Trident House Blackrock Co Dublin Re: 10th October 2001 W illia m Kearney Deceased Dear Inspectors, We confirm that we have been handed your letter o f the 21st ult. addressed to Veronica Purcell. The Executors o f the Estate o f W illiam Kearney are Veronica Purcell and Peter Kearney and we are instructed by them to respond to you. W e confirm that this firm acted in the administration o f the Estate o f the late W illiam Kearney who died on the 19th o f September 1994.' A t the time o f his death a thorough and full evaluation o f his assets was undertaken.by this office for Probate purposes and the usual Searches were made in financial institutions. Arising out o f that evaluation o f his assets no reference or evidence was found to suggest that the late W illiam Keamey was a client o f Ansbacher, Guinness Mahon or in anyway involved with or connected w ith Monarch Properties Limited. We are instructed by the Executors to inform you that our clients are very surprised at the allegation that their father may have had any such an account. They do not have any knowledge nor do they accept that W illiam Keamey had such an account as alleged. This surprise is based on the fact that he was not a good manger o f his finances and throughout his life he immersed him self totally in his medical career to the exclusion o f everything else. One can only assume i f there was such an account as you allege it was opened without his instructions and/or without his knowledge. We refer to the documentation furnished by you particularly the four letters attached to your letter and we make the following observations and comments upon the said letters. W e refer to the two letters dated the 30th o f June 1976, one written by T R Leonard to J A Furze and the second by T R Leonard to Frank Lee. j0hnPurceii bo. SimonJ. Murphybcl Catherine M.Deasybcl Barry G.O’Meara bcl Crona Hughes bcl Virginia Harringtona.A.BCLH.&pComp Consultants: John A. O’Meara KE0233/1/4104intwi.feottielan DublinOffice: 26/ 27 Upper OrmondQuay. (a) (b) (c) (d) (e) If an account ,vas opened in the name o f W illiam Kearney who authorised the opening o f the account? Is there a signature on any documents opening the alleged account? Who are the signatories on the account? Who controlled the account? Who signed the Authority for the withdrawal o f monies? It is noted that the monies were in dollars. Where had the dollars originated from? We now refer to the other two letters, namely, the letter dated the 8th o f July 1976 Michael Shield o f Guinness Mahon Caymen Trust Lim ited to T R Leonard o f Guinness and Mahon Limited and letter o f the 17th o f December 1976 from T R Leonard addressed to W illiam Kearney (no address). W e make the following observations and comments:iL (a) (b) (c) (d) (e) (f) The funds were placed on deposit for six months on the 8 o f July 1976. They were withdrawn before the six months were up on the 17th o f December 1976. Who authorised the withdrawal? Who signed the withdrawal document? On whose instructions were these monies moved from place to place as it is quite clear there were no instructions from W illiam Kearney? W e refer to the purported letter to W illiam Kearney Esq. dated the 17th o f December. To what address was this letter sent? The said letter o f the 17th o f December refers to a receipt. Do you have a receipt and by whom is it signed? I f such a receipt exists and is signed by one W illiam Kearney please furnish a copy and we w ill let you know whether we believe it is the signature o f the late Professor W illiam Kearney. Who instructed T R Leonard to send the said monies to a W illiam Keamey on the 17th o f December 1976? . Neither our clients nor ourselves have any knowledge or reason to believe that the late W illiam Keamey was a client o f Ansbacher, other than the evidence you have furnished which in itself is not conclusive, in that you have not furnished sufficient documentation to show that monies were held in the name o f the late Professor W illiam Keamey, nor is there any evidence that he received such monies. M ore significantly we have not received any documentation from you to-date to show his signature attached to any documentation opening an account or withdrawing monies from an account. It is also noted that your conclusion was that Professor W illiam Keamey as a client o f Ansbacher. None o f the documentation furnished refers to a Professor W illiam Keamey. For this reason amongst several others we cannot accept your conclusion. W e are concerned that the letters attached to your letter o f the 21st ult. includes the names o f other third parties, which appear unrelated to the alleged payment to W illiam Keamey. We trust that no such publication o f the late Professor W illiam Kearney’s name w ill be made to any third parties or published without full justification for same and that no such publication w ill take place without this office being first notified so that we have on behalf o f our clients the full opportunity to consider same. Please confirm. Finally we wish to point out in the strongest manner that the letters you have sent us do not establish that Professor W illiam Kearney was a client o f Ansbacher. A p p e n d ix X V (6 1 ) M r J o h n K e n n e d y 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John Kennedy. a) Transcript o f evidence of Mr John Kennedy dated 13 April 2000. b) Letter and enclosures of 15 March 2000 - Mr John Kennedy to Inspectors. c) Letter o f 17 June 1993 - Cayman International Bank & Trust Co Limited to IIB. d) Statement of a/c of Cayman International Bank & Trust Co Limited o f 6 October 1994. UNDER OATH ON THURSDAY, 13TH APRIL 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer MR. JUSTICE COSTELLO MS. M A C K E Y BL S o l i c i t o r to the I n s p e c t o r s MS. M. C U M M I N S Interviewee: MR. JOHN KENNEDY R e p r e s e n t e d by: MR. DAVID CLARKE The I n s p e c t o r s : McCANN FITZGERALD 2 HA R B O U R M A S T E R PLACE IFSC DUBLIN 1 WITNESS MR. J. KENNEDY I EXAMINATION MR. JUSTICE COSTELLO PAGE 46 1 2 3 4 MR. JUSTICE COSTELLO: Mr. 5 Kennedy, let me introduce myself. I am 6 D e c l a n C o s t e l l o a n d o n m y r i g h t is Ms. Mackey. We 7 are two of the Inspe c t o r s who have b e e n appointed, 8 as y o u know, b y The H i g h Court. 9 10 I s h o u l d e x p l a i n t o you, as I do t o o t h e r p e o p l e 11 w h o c o m e t o us l i k e you, t h a t t h i s is n o t a C o u r t 12 hearing. 13 investigation. 14 a n d we w a n t to a s k you some q u e stions. It is n o t a T r i b u n a l . It is an We are c a r r y i n g out an i n v e s t i g a t i o n 15 16 If i n t h e c o u r s e o f t h e q u e s t i o n s w e a s k y o u if y o u 17 w i s h to g e t t h e a d v i c e o f y o u r s o l i c i t o r o n t h e 18 q u e s t i o n p l e a s e t e l l us a n d w e w i l l s t o p a s k i n g y o u 19 questions. 20 21 Similarly, i f y o u r s o l i c i t o r w i s h e s at a n y t i m e to 22 a s k us to stop, 23 he is a l i b e r t y to d o so. t h a t h e w i s h e s t o c o n s u l t w i t h you, 24 25 Mr. 26 will ask our solicitor, 27 a d m i n i s t e r t h e o a t h t o you. 28 29 Kennedy, w e t a k e y o u r e v i d e n c e o n o a t h a n d we Ms. Cummins, now, to 1 would like to make when Mr. Kennedy has been 2 administered the oath. 3 MR. JUSTICE COSTELLO: 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Very well. 1 2 3 4 MR. JUSTICE COSTELLO: Yes, 5 MR. CLARKE: F o r g i v e me, Clarke? Sir. It is just a few small points, 6 7 Mr. h a v i n g s p o k e n to Mr. K e n n e d y a b o u t it. 8 9 A s y o u h a v e said, Sir, the Inspectors are here 10 c a r r y i n g out an i n v e s t i g a t i o n a n d I h a v e c o n f i r m e d 11 t o Mr. 12 position correctly, 13 an i n s p e c t i o n into the a f f a i r s of the company. Kennedy, and I t h i n k I u n d e r s t a n d the t h a t t h e i n s p e c t i o n is o b v i o u s l y 14 15 In t h e I n s p e c t o r ' s 16 said clearly, 17 t h a t it w a s g o i n g to b e n e c e s s a r y t o a s k Mr. 18 questions about his affairs with the company. l e t t e r to us, understandably they that in o r d e r for the p u r p o s e of d o i n g Kennedy 19 20 However, I t h i n k I am r i g h t in saying, Sir, 21 t h e i n s p e c t i o n is n o t a n i n s p e c t i o n o r r e p o r t in 22 r e l a t i o n to Mr. 23 it t h a t t h a t is t h e s i t u a t i o n . Kennedy's own tax affairs. that I take 24 25 It h a s a p a r t i c u l a r , 26 r e l a t i o n to Mr. 27 you w ill be aware from the statement, w h i c h we w o u l d 28 h a v e s u b m i t t e d to y o u b e f o r e h a n d , Kennedy did 29 take a d v a n t a g e of The W a i v e r Act 1973 a nd b y v i r t u e I suppose, s i g n i f i c a n c e in K e n n e d y ' s o w n p o s i t i o n b e c a u s e as Mr. 1 of t h a t I t h i n k is t h e i n t e n t i o n of t h e A c t ; 2 t o b e r e g a r d e d as h a v i n g f u l l y d e a l t w i t h a l l h i s 3 tax affairs and the y w o u l d not be e n q u i r e d into 4 other than under t h e . . . (INTERJECTION). 5 MR. JUSTICE COSTELLO: I know what you say Mr. 6 7 any question that 8 p o i n t o n p l e a s e le t m e know. 9 MR. Clarke. If t h e r e is I ask that you w i s h to raise any CLARKE: I u n d e r s t a n d tha t, Sir, sorry. 10 11 h e is 1 Q. MR. JUSTICE COSTELLO: Mr. Kennedy, you supplied us w i t h a s t a t e m e n t a n d I 12 13 w o u l d l i k e to t a k e y o u t h r o u g h t h e s t a t e m e n t a n d a s k 14 you some questions 15 that perhaps 16 y o u r b u s i n e s s h i s t o r y b e f o r e t ha t . 17 developing, 18 A. 19 20 2 Q. 22 A. 23 3 Q. 24 A. 25 4 Q. t h a t is ri g h t , A. 28 trade, since about Y o u w e r e in t h e is t h a t r i g h t ? 19 -- w h a t y e a r ? yes. H a d y o u a p a r t n e r then, McKeon? I had a partner, Mr. M c K e o n . W h a t was the n a m e of y o u r c o m p a n y t h en? Sheelin Homes Limited. Yes. Before you e s t a b l i s h e d this trust had you had Yes, with a Guinness T r a y n o r or Guinn e s s & Mahon. From Guinness & Mahon? & Mahon? Sheelin Homes had p u r c h a s e d two sites from Guinness 5 Q. before I think. a n y d e a l i n g s w i t h Mr. 26 29 the building, T h e l a t e 1 96 0s, Mr. However, you c o u l d just g i v e me an o u t l i n e of The late 1960s 21 27 Yes, a r i s i n g f r o m it. & Mahon. 1 2 6 Q D i d y o u m e e t Mr. T r a y n o r t h e n in t h e c o u r s e o f y o u r 3 business arrangements with Guinness 4 did that come a b o u t . . . (INTERJECTION)? 5 A No, I m e t Mr. 6 7 Q Mr. O'Kelly? 7 A 8 8 Q 9 & M a h o n or how O'Kelly. Yes . Was it at Mr. O'Kelly's suggestion then that you c o n s i d e r e d e s t a b l i s h i n g a trust in the Cayman Islands? 10 11 A 12 9 Q 13 A 14 10 Q 15 A 16 I j u s t c a n ' t r e m e m b e r that . Yes ? It w a s e x p l a i n e d t o m e b y Mr. Traynor. Yes? J u s t e x a c t l y t h e f i r s t i n s t a n c e o f it I j u s t d o n ' t remember exactly. 17 11 Q 18 A 19 12 Q Y ou do not r e m e m b e r? No. Yes. However, e i t h e r Mr. T r a y n o r c o n t a c t e d yo u or 20 Mr. O ' K e l l y s u g g e s t e d t h a t y o u c o n t a c t a n d t a l k to 21 Mr. T r a y n o r a b o u t it, 22 A 23 13 Q is t h a t w h a t h a p p e n e d ? Yes . Right. I w o u l d l i k e y o u to e x p l a i n Mr. 24 as m u c h d e t a i l as y o u can, 25 it w a s p r o p o s e d t o do? 26 A Mr. w h a t Mr. Kennedy, in Traynor told you T r a y n o r e x p l a i n e d that i n s t e a d of h a v i n g m o n e y 27 in a n a c c o u n t w i t h o n e o f t h e b a n k s i n D u b l i n l i k e 28 A I B or B a n k O f I r e l a n d o r w h a t e v e r , 29 d i s c l o s e d i n c o m e or not d i s c l o s e d money, which wasn't t h a t if t h e 1 m o n e y w e r e g i v e n t o h i m h e c o u l d p u t it, 2 i n s u c h a w a y t h a t if q u e s t i o n s w e r e a s k e d a b o u t t h e 3 m o n e y that the m o n e y w ould be effe c t i v e l y outside my 4 control and m y ownership. 5 Yes ? 6 A t r e a t it, To t a l l y outside m y own ow n e r s h i p and control, 7 t h a t it w a s a q u e s t i o n o f b e i n g a b l e t o t r u s t 8 Mr. 9 t h a t p r o b l e m w i t h h i m t h e n t h e m o n e y w o u l d be but T r a y n o r e n t i r e l y a n d t h a t if I c o u l d g e t o v e r 10 o u t s i d e m y o w n e r s h i p an d c o n t r o l in e v e r y s ense of 11 t h e w o r d b u t t h a t h e w o u l d h a v e -- I w o u l d h a v e an 12 u n d e r s t a n d i n g w i t h h i m t h a t at t h e s a m e t i m e w h i l e 13 it w a s n ' t 14 a v a i l a b l e to m e f o r w h a t e v e r p u r p o s e 15 15 Q 16 I wished. D i d he e x p l a i n to y o u a b o u t t h e e s t a b l i s h m e n t of a t r u s t ? 17 A 18 16 Q 19 Yes . Had you ever come across a di s c r e t i o n a r y trust before this? 20 A 21 17 Q 22 No. D i d he e x p l a i n to yo u that this was a d i s c r e t i o n a r y trust? 23 A 24 18 Q 25 A 26 19 Q 27 A 28 29 Yes. l e g a l l y m y m o n e y h e w o u l d m a k e it E m . . . (INTERJECTION). Do y o u r e m e m b e r t h o s e w o r d s b e i n g u s e d ? I d on't r ecall t hose words. Y o u d o n o t r e c a l l it? No, w h a t t h e g i s t o f it was, saying, 20 Q Yes? that I remember distinctly I w o u l d h a v e n o c o n t r o l l e g a l l y at all. 1 2 21 Q. 3 A. 4 22 Q. 5 A. 6 23 Q. Yes? O n c e I p a s s e d it t o him. Yes. H o w e v e r ...(INTERJECTION)? B u t -- p a r d o n . No. D i d h e e x p l a i n t o y o u a b o u t t h e m o n e y b e i n g in 7 the o w n e r s h i p of a trust c o m p a n y a nd that you w o u l d 8 b e s e n d i n g a L e t t e r O f W i s h e s as t o h o w y o u w i s h e d 9 t h e t r u s t c o m p a n y to u s e t h e m o n e y ? 10 A. There was certainly a Letter Of Wishes. I don't 11 r e c a l l to w h o m the L e t t e r Of W i s h e s was a d d r e s s e d 12 b u t t h a t d i d n ' t s e e m to m e i m p o r t a n t f o r t h e r e a s o n 13 t h a t it w a s a q u e s t i o n t h a t i f I k n e w i f t h e m o n e y 14 w a s p a s s e d o u t o f m y c o n t r o l t h a t it w a s 15 m a t t e r of r e l y i n g e ntirely. 16 24 Q. 17 A. O n Mr. 18 25 Q. I see? 19 A. 20 26 Q. On him? Traynor's g o o d . ..(I N T E R J E C T I O N ) . Good w i l l . I see. Mr. advisor, 21 22 A. 23 27 Q. 24 A. 25 28 Q. I a m s u r e y o u h a d a n a c c o u n t a n t y o u r s e l f at t h e you, 29 Q. did you? No. 27 29 you did not consult any legal About this? time. A. Kennedy, N o t at a l l . 26 28 simply a Perhaps, you had a personal accountant, for y our own p e r s o n a l a f fairs? I am an a c c o u n t a n t myself. Y o u are an a c c o u n t a n t y o u r s e l f ? had 1 2 30 Q. 3 A. 4 Yes? B u t it w a s o n t h e b a s i s w i t h Mr. Traynor that this w a s n ' t to b e d i s c u s s e d w i t h a n y b o d y els e. 5 31 Q. 6 A. 7 With anybody else? A n d I was comfortable with that just simply because I a c c e p t e d h i m at h i s w o r d . 8 32 Q. 9 A. 10 33 Q. 11 A. 12 34 Q. 13 A. 14 35 Q. 15 A. 16 36 Q. 17 A. 18 37 Q. 19 Y o u t r u s t e d Mr. Traynor? Yes. W h o w e r e y o u r f i r m of a c c o u n t a n t s t h e n ? B u c k l e y Delaney. Buckley? Buck l e y Delaney. Delaney, yes? Yes. They looked after your company's accounts, Yes, did they? t h e y did. Did they look after your own personal tax accounts as w e l l ? 20 A. 21 38 Q. Yes, yes. Y o u d i d n o t t a l k to -- w a s it Mr. D e l a n e y who was looking after them? 22 23 A. 24 39 Q. 25 Mr. Yes. Dan Delaney, yes. Can you remember did you actually sign a T r u s t D e e d y o u r s e l f Mr. 26 A. 27 40 Q. 28 A. 29 41 Q. Kennedy? I do r e m e m b e r a document, quite a thick document. Yes? Y o u know, Yes? something like that (INDICATING). 1 2 42 Q. 3 A. 4 43 Q. 5 A. A n d I w a s n ' t t h a t c o n c e r n e d a b o u t it t o b e h o n e s t . Yes? B u t I d o -- t h e r e w a s c e r t a i n l y a d o c u m e n t a n d t h e r e was c e r t a i n l y a Letter Of Wishes. 6 7 44 Q. 8 A. 9 10 Yes? Yes? T hey are the only two doc u m e n t s that I a c t u a l l y remember. 45 Q. Yes. Y o u s e e w h y I a s k y o u t h a t Mr. K e n n e d y is t h a t 11 s o m e of t h e e v i d e n c e w h i c h w e h a v e o b t a i n e d w o u l d 12 i n d i c a t e that a p e r s o n in y o u r p o s i t i o n a c t u a l l y di d 13 n o t h i m s e l f s i g n t h e T r u s t Deed, 14 s i g n e d t h e T r u s t Deed, 15 y o u c o u l d h a v e b e e n t o l d t h a t it w o u l d b e a p e r s o n 16 in the C a y m a n Islands who w o u l d be a c t u a l l y s i g n i n g 17 t h e De ed. 18 said? 19 A. 20 46 Q. 21 A. 22 47 Q. 23 A. 25 48 Q. 26 A. 27 29 t h a t y o u w e r e t o l d -- t h a t Do y o u r e m e m b e r a n y t h i n g l i k e t h a t b e i n g I don't recall. You do not? No. Y o u d o n o t -- c a n y o u -- h a v e y o u a n y r e c o l l e c t i o n of a c t u a l l y s i g n i n g it o r j u s t r e a d i n g t h e d o c u m e n t ? 24 28 that somebody else I d o n ' t r e m e m b e r s i g n i n g it. Y o u d o n o t r e m e m b e r s i g n i n g it? I j u s t k i n d of -- I a s s u m e d I h a d s i g n e d it. I d o n ' t r e m e m b e r it. 49 Q. Yes, I see, yes. What about the Le t t e r Of Wishes, 1 2 50 Q 3 A 4 You think you signed? I r e m e m b e r -- I t h i n k I r e m e m b e r s i g n i n g t h e L e t t e r Of Wishes. 5 51 Q 6 A Do y o u r e m e m b e r w h a t it s a i d ? I t h i n k it w a s a v e r y s h o r t l e t t e r a n d I t h i n k t h e 7 g i s t o f it w a s t h a t if I w e r e n ' t a r o u n d t h a t t h e 8 m o n e y w o u l d b e a v a i l a b l e to m y f a m i l y . 9 52 Q Yes. However, d i d it i n d i c a t e t h a t it w o u l d b e a v a i l a b l e to y o u i f y o u w e r e a r o u n d ? 10 11 A 12 53 Q 13 A 14 54 Q 15 A 16 55 Q I don't remember. Y o u do not r e m e m b e r ? No. Yes? I d on't r e m e m b e r the letter, Yes. T h e r e w a s a c o m p a n y e s t a b l i s h e d a l s o in t h e 17 Cay m a n Islands, 18 right? 19 A 20 56 Q 21 A 23 57 Q 24 A 25 26 T h a t is r i g h t , Penta Investments Limited, is t h a t yes. W e r e y o u t o l d a b o u t it? Just the name I knew about but other tha n that didn't 22 no. k now. I I had no details about the company. W e l l . . . (INTERJECTION)? I don't remember seeing the Articles or m e m o r a n d u m or lists or whatever. 58 Q I w o n d e r d i d y o u s e e at a n y time, perhaps, a very 27 short statement 28 w o u l d have in d i c a t e d that perhaps the trust owned 29 t h e s h a r e s in P e n t a I n v e s t m e n t L i m i t e d . of a c c o u n t o f t h e t r u s t i n w h i c h it Can you 1 2 A. 3 59 Q. 4 A. 5 60 Q. I don't remember. You do not? I don't remember. Do yo u k n o w wh o o w n e d the s h a r e s in P e n t a I n v e s t m e n t Limited? 6 7 A. 8 61 Q. 9 A. 10 62 Q. No. Y ou do not? No, I don't remember, Right. no. Do y o u r e m e m b e r w h o w a s t h e T r u s t e e t h e n of this trust? 11 12 A. 13 63 Q. I don't remember, no. Wha t about the c o m p a n y that was in the Cayman 14 Islands that was a s u b s i d i a r y of Guinn e s s & Mahon, 15 this Guinness M ahon Cayman Trust Limited. Did you 16 ever h ear of that company? 17 A. 18 64 Q. 19 A. 20 65 Q. 21 It d o e s n ' t r i n g a b e l l . Y ou do not? I d o n ' t r e m e m b e r it. Y ou do not r e m e m b e r who the Tr u s t ee was in the T rust D e e d that you saw? 22 A. 23 66 Q. 24 25 I don't. I d o n ' t r e m e m b e r at all. Y o u d o n o t r e m e m b e r w h e t h e r it w a s t h e c o m p a n y or w h o it w a s ? A. I don't remember, no. So r r y , I just.. . (INTERJECTION). 26 27 67 Q. 28 A. Yes. 29 68 Q. Yes? Y o u l e f t it a l l t o Mr. Traynor? 1 2 69 Q 3 A 4 70 Q 5 A 6 71 Q 7 8 Yes . A g a i n w a s t h i s at Mr. Traynor's direction? Yes . Do y o u r e m e m b e r h o w -- w h o y o u t r a n s f e r r e d t h e f u n d s to ? A 9 I r e m e m b e r o n e m e e t i n g at t h e B a n k O f I r e l a n d in C o l l e g e G r e e n w h e r e we transferred, money. m y partner and 10 myself transferred, 11 c o u n t e r i f y o u l i k e a n d Mr. 12 at t h a t m e e t i n g a n d t h e m o n e y w a s t r a n s f e r r e d , 13 l i t e r a l l y h a n d e d ove r. 14 72 Q 15 A 16 73 Q W a s it i n b a n k n o t e s ? 17 A It w a s in b a n k n o t e s . 18 74 Q 19 A 20 75 Q It w a s n o t i n b a n k n o t e s Yes, I t a k e it? I see? Yes, yes. I see. He t h e n -- y o u h a n d e d o v e r t h e m o n e y t o h i m a n d h e l o o k e d a f t e r it. 22 s e n t it, A Collery was there it w a s i n b a n k n o t e s . 21 23 It w a s j u s t a c r o s s t h e No, H e w a s g o i n g t o p u t it, o u t to C a y m a n I s l a n d s , is t h a t i t? it w a s a c t u a l l y -- w e w e r e s i t t i n g — standing 24 on the same side of the c o u n t e r a n d I was here 25 (INDICATING) 26 Mr. 27 was there 28 m o n e y to there 29 and he was there McKeon and m y self was here (INDICATING) (INDICATING). (INDICATING) a n d he a nd we just t r a n s f e r r e d the (INDICATING). 1 A. A n d he t r a n s f e r r e d it o v e r a c r o s s t h e c o u n t e r . w a s -- t h a t w a s all. 2 3 77 Q. 4 A. 5 However, No, d i d y o u k n o w w h e r e it w a s g o i n g t o g o ? I u n d e r s t o o d it w a s n ' t g o i n g a n y w h e r e . T h a t it w a s . . . (INTERJECTION). 6 78 Q. 7 A. 8 79 Q. 9 A. 10 80 Q. G o i n g to s t a y in I r e l a n d yo u say? Yes. I see. However, I w i l l c o m e to t h a t n o w ? Yes. However, before I do so, the m o n e y that was 11 i n i t i a l l y sent b y yo u for the trust, 12 of t h e t r u s t ? 13 A. 14 81 Q. 15 A. 16 82 Q. 17 A. for the p u r p o s e F o r Pen ta . For Penta Investments? Yes. W a s g i v e n i n c a s h b y y o u to Mr. Collery? A n d o n e o t h e r -- t h e r e w a s -- I a l s o -- so f a r as 18 I c a n r e c a l l t h e r e w a s m o n e y in a n a c c o u n t , 19 accounts, 20 have been transferred but 21 t r a n s f e r r e d t o P e n t a at t h e s a m e t im e . 22 It 83 Q. 23 Yes. with Guinness However, A. 25 84 Q. 26 A. 27 85 Q. 28 A. 29 86 Q. I didn't I w a s n ' t i n v o l v e d i n that, w a s it n o t ? k n o w t h a t at t h e tim e. You did not I didn't & Mahon which I think would P e n t a I n v e s t m e n t s w a s i n c o r p o r a t e d in the Cayman Islands, 24 know that? k n o w t h a t at t h e ti m e . At the time? No. I see. in Y o u h a v e l e a r n d it s i n c e , have you? 1 2 87 Q I see. W h a t you s a i d in y o u r s t a t e m e n t 3 and I am 4 k n o w if y o u h a v e . . . ( I N T E R J E C T I O N ) ? 5 A 6 88 Q 7 A 8 89 Q 9 ( E x h i b i t 1), quoting from the third paragraph. I h a v e it w i t h me, I don't yes. G o t a c o p y of it t h e r e ? Yes . Do y o u se e in t h e m i d d l e o f t h e p a g e : "As f a r as I c a n r e c a l l m y u n d e r s t a n d i n g w a s t h a t t h e t r u s t w a s to b e e s t a b l i s h e d in t h e C a y m a n I s l a n d s b u t that the m o n e y w o u l d be h e l d in I r e l a n d w i t h ' m a t c h i n g fu n d s ' h e l d o f f - s h o r e ." 10 11 12 13 A 14 90 Q 15 A 16 Yes . C o u l d you just ex p a n d a little bit on that? Yes. T h a t is j u s t a n e x p r e s s i o n I r e m e m b e r b e i n g u s e d at t h e tim e. 17 91 Q 18 A Yes ? A n d w h a t I u n d e r s t o o d it to m e a n w a s t h a t w h i l e t h e 19 cash that 20 there were some other accounts somewhere else that 21 s o m e h o w -- t h a t i n s t e a d o f a c t u a l l y p h y s i c a l l y 22 m o v i n g funds around the place, 23 would remain here and that maybe somebody else would 24 h a v e a c c e s s to t h o s e funds a n d I w o u l d h a v e a c c e s s 25 t o f u n d s s o m e w h e r e else . 26 a c t u a l l y g e t i n t o t h e d e t a i l o f it at all. 27 92 Q 28 A 29 I h a d w i t h Penta w o u l d be in Ireland, that the funds I d o n ' t kno w. that I had I didn't I see? It w a s j u s t a s t r a n g e t h i n g b e c a u s e Mr. Traynor had t h i s t h i n g of j u s t b e i n g a b l e to e x u d e c o n f i d e n c e 1 2 93 Q 3 A 4 94 Q 5 A 6 95 Q 7 Yes ? A n d I d i d n ' t e n q u i r e in d e t a i l . Yes ? It w a s n ' t a b i g is s u e . L o o k i n g b a c k o n it n o w a n d l o o k i n g at t h e d o c u m e n t s that you have since seen? 8 A 9 96 Q Yes . Is it n o t c l e a r t h a t P e n t a I n v e s t m e n t s w a s 10 incorporated, 11 the C a y m a n Islands? 12 A 13 97 Q 14 A 15 98 Q as y o u s a y i n d e e d i n t h i s l e t t e r , Yes . Is t h a t n o t c l e a r ? It is c l e a r now, yes. Is it n o t c l e a r t o o t h a t P e n t a I n v e s t m e n t s h a d m o n e y 16 on deposit 17 C a y m a n I s l a n d s b e c a u s e Mr. 18 interest, 19 a n d y o u r p a r t n e r in the company, 20 from the documents? 21 A Yes, 22 99 Q Now? 23 24 25 in t h e Furze was d i v i d i n g up the w h i c h the m o n e y h a d earned, between you is t h a t n o t c l e a r t h a t is c l e a r . Now, y o u d i d n o t k n o w it the n, is t h a t t h e Well, to b e q u i t e h o n e s t I hadn't really thought a b o u t it v e r y m u c h then. 26 100 Q 27 A 28 29 in t h e n a m e o f P e n t a I n v e s t m e n t s position? A Yes? I a m n o t s u r e t h a t it is i n c o n s i s t e n t w i t h t h e c o n c ep t of the m a t c h i n g funds either. 101 Q in No? 1 2 102 Q 3 A 4 103 Q 5 Yes, yes. A r g u i n g t h a t p o i n t w i t h you. f i n d o u t wh a t , 6 A 7 104 Q 8 A 9 105 Q in fact, I a m j u s t t r y i n g to what happened? Yes . What you now know happened? Yes . D o e s it n o w n o t l o o k as i f t h i s C a y m a n I s l a n d c o m p a n y h a d on its b o o k s the funds? 10 11 A 12 106 Q Yes . W h i c h you had transferred, gi v e n , t o Mr. Collery and 13 t h a t i n s o m e w a y t h e s e f u n d s w e r e o n t h e b o o k s of 14 t h e C a y m a n c o m p a n y in C a y m a n e a r n i n g i n t e r e s t , 15 w h i c h Mr. 16 u s e d s u b s e q u e n t l y as p a r t o f t h e d o c u m e n t s t h a t y o u 17 s h o w e d to the R e v e n u e ? 18 A 19 107 Q 20 A 21 108 Q F u r z e d i v i d e d up, and which you T h a t is c o r r e c t . Is t h a t n o t so? T h a t is e x a c t l y r i g h t , So t h at , i n fact, yes. you w ere p a y i n g t ax on i n terest t h a t a r o s e in t h e C a y m a n I s l a n d s ? 22 23 A 24 109 Q 25 Yes . D o e s t h a t n o t l o o k -- is t h a t n o t w h a t w a s happening? 26 A Yes, 27 110 Q Yes? 28 A 29 111 Q t h a t is e x a c t l y it. The situation, yes. 1 Yes . 2 3 112 Q I c a n se e t h a t y o u r k n o w l e d g e o f w h a t h a p p e n e d 4 n o w is d i f f e r e n t to y o u r k n o w l e d g e w h e n t h e 5 scheme started, 6 A 7 It is so b u t is t h a t n o t so? I am still not clear exactly, y o u know, w h e r e t h e m o n e y was. 8 113 Q 9 A 10 114 Q 11 A 12 115 Q 13 W h e r e the m o n e y was? I am still n o t . . . (INTER J E C T I O N ) . I understand? I s t i l l d o n ' t u n d e r s t a n d tha t. Yes. Leaving aside the technicalities of w h e r e the m o n e y was? 14 A 15 116 Q Yes . Y o u s e e m e d to h a v e h a d no d o u b t t h a t yo u w e r e 16 e n t i t l e d to u s e t h e m o n e y t h a t y o u h a d g i v e n to 17 Mr. 18 A 19 C o l l e r y a n d Mr. I didn't. Traynor? I understood clearly that I didn't have a legal entitlement. 20 117 Q 21 A Yes? I p a s s e d o v e r t h e l e g a l o w n e r s h i p b u t t ha t , 22 Mr. 23 them. 24 118 Q 25 A 26 119 Q T r a y n o r 's a r r a n g e m e n t , under I w o u l d b e a b l e to u s e T h a t w a s t h e g o o d wi l l . Yes ? The u n d e r s t a n d i n g of the trust. Because, in fact, the a c c o u n t s yo u got w e r e in the 27 n a me , 28 M ahon Cayman Island Trust and then later 29 "Ansbacher", w e r e t h e y not, of o r i g i n a l l y the G u i n n e s s is t h a t n o t so ? Di d yo u not see the 1 No. 2 3 120 Q 4 A 5 Did you not? No, no. The word "Ansbacher" never properly.. . (INTERJECTION). 6 121 Q 7 A 8 122 Q 9 A 10 123 Q Never? Never occurred, I see. no. W h e n you got accounts from time to time? Yes . W e r e t h e s e as a r e s u l t o f a s k i n g Mr. 11 w o u l d t h e y c o m e a u t o m a t i c a l l y to you, 12 remember? 13 A I just don't remember. T r a y n o r or do you I'm sure I w o u l d have been 14 c u r i o u s a b o u t it. 15 m a y b e o n c e a y e a r o r m a y b e t h a t k i n d of t h i n g , 16 infrequent. 17 124 Q 18 A 19 They came ve r y i n f r e q u e n t l y like Yes ? A n d w h e n the y came they were on just simple b l a n k s h e e t s of p a p e r w i t h s o m e n u m b e r s . 20 125 Q 21 A 22 126 Q 23 A 24 127 Q 25 A 26 128 Q 27 I see. T h e r e w a s n o n a m e o n i t? There was no name. Yes? Or addresses. Yes ? O r a n y t h i n g l i k e that . The b l a n k sheets of paper, bank statement? 28 A 29 129 Q No. were they rather like a 1 2 130 Q. 3 A. 4 131 Q. 5 A. 6 132 Q. 7 T h e y w e r e n o t at a l l . . . ( I N T E R J E C T I O N ) ? No. Like bank statements? No, no. Yes. N o t at all, no. T h e y w e r e as if t h e y w e r e t y p e d u p o n a b l a n k s h e e t of p a p e r ? 8 A. 9 133 Q. 10 A. 11 134 Q. 12 A. Yes. The figures? Absolutely, yes. What did those figures show? T h e y s h o w e d h o w t h e b a l a n c e o n -- I p r e s u m e -- I 13 j u s t c a n ' t r e m e m b e r now. 14 shown the b a l a n c e of say Penta L i m i t e d under 15 whatever denominations, 16 w h a t e v e r m a y b e t h r e e or f o u r l i n e s . 17 135 Q. 18 dollars, sterling and However, it w a s i n t h e n a m e o f P e n t a I n v e s t m e n t s Limited, is t h a t r i g h t ? 19 A. 20 1 3 6 Q. 21 A. Yes. 22 137 Q. Yes. 23 I t h i n k it w o u l d h a v e A s f a r as I a m r e m e m b e r , As yes. f a r as y o u r e m e m b e r ? This showed you what account, what deposits, the company held? 24 A. 25 138 Q. 26 A. Value. 27 1 3 9 Q. Value? 28 A. 29 140 Q. Yes, the a c c u m u l a t e d . . . ( I N T E R J E C T I O N ) . The a c c u m u l a t e d ? Of that money, yes. If w e c o u l d j u s t d e v e l o p it a l i t t l e bi t. If y o u 1 ( E x h i b i t 1): 2 3 " F r o m t i m e to time I r e c e i v e d statements"? 4 5 6 Yes . 141 Q It re a d s : 7 "I w a s a s k e d f r o m t i m e to t i m e i n w h a t c u r r e n c y I w i s h e d to h a v e t h e f u n d s or parts of the funds d e n o m i n a t e d . . . " 8 9 10 A 11 142 Q Yes . "...and I chose currencies t i m e ..."? 12 f r o m t i m e to 13 14 A 15 143 Q 16 Yes . W h o a s k e d y o u a b o u t t h a t Mr. Mr. 17 A 18 144 Q 19 A 20 145 Q 21 A W a s it Traynor? E i t h e r Mr. Mr. Kennedy? O ' K e l l y o r Mr. O ' K e l l y o r Mr. Traynor. Traynor? Yes . W o u l d you h a v e t a l k e d w i t h b o t h of t h e m a b out t h is? I a m s u r e I did. There were very few conversations about i t . 22 23 146 Q 24 A Yes ? It w a s n ' t -- y o u k n o w w h a t I mean? It w a s n ' t a 25 t h i n g w h e r e t h e r e w a s a lo t o f c o m m u n i c a t i o n . 26 was ver y little communication. 27 147 Q 28 A 29 148 Q Yes? Yes . There 1 2 A. 3 1 4 9 Q. "I c h o s e c u r r e n c i e s f r o m t i m e t o t i m e as I t h o u g h t w e r e m o s t p r o f i t a b l e " ? Yes. W o u l d y o u say, "Well, I w o u l d l i k e so m u c h of m y 4 funds in do l la r s 5 of m y f u n d s in D e u t s c h e m a r k s . " 6 happened? 7 A. 8 150 Q. 9 A. T h a t is e x a c t l y , 11 151 Q. 12 A. in dollars, Yes. or so m u c h Is t h a t w h a t yes. Y ou knew t he y w ere on deposit, is t h a t r i g h t ? T h e y w e r e on d e p o s i t in effect. were on deposit, 10 security, I knew they yes. Yes? I d i d n ' t g e t i n t o -- it d i d n ' t s t r i k e me, you 13 know, 14 Mr. 15 a r r a n g e m e n t w h e r e h e c o u l d -- e v e r y t h i n g s e e m e d to 16 be r e a l l y e a s y for h i m a n d the m o n e y was on deposit. 17 152 Q. 18 A. 19 153 Q. as t o w h e r e o r w h e n a n d so on. Traynor was k i n d of r u n n i n g s o m e k i n d of The m o n e y was on de posit? Yes. T h e n it w a s o n d e p o s i t i n s t e r l i n g , 20 in a s t e r l i n g a c c o u n t , 21 was 22 Deutschemarks, 23 A. 24 154 Q. 25 A. I thought s o m e o f it w a s is t h a t r i g h t ? S o m e o f it i n a d o l l a r a c c o u n t a n d s o m e o f it w a s i n a is t h a t w h a t y o u u n d e r s t o o d ? T h e y w e r e d e n o m i n a t e d in t h o s e c u r r e n c i e s . D e n o m i n a t e d in t h o s e ? What I m e a n b y that , I think, is I a s s u m e d 26 Mr. 27 w h a t e v e r l a r g e f u n d s he w a s d e a l i n g w i t h h e c o u l d 28 s a y -- h e c o u l d p l a c e y o u r -- g i v e y o u d e n o m i n a t i o n s 29 in w h a t e v e r w a y y o u w a n t e d i t . Traynor had sufficient, y o u know, he h a d - ­ 1 155 Q 2 A 3 156 Q 4 A n d y o u t o o k y o u r c h a n c e s o n it i n t h a t way. W h a t y o u m e a n b y t h a t is t h a t if t h e c u r r e n c y a p p r e c i a t e d y o u w o u l d g a i n b y it? 5 A 6 157 Q 7 A 8 158 Q 9 Yes . Is t h a t it? T h a t is r i g h t , yes. Y o u w o u l d h a v e k n o w n also, of course, that the m o n e y was earning interest? 10 A 11 159 Q Yes . From the knowledge you have since received 12 Mr. 13 m o n e y to w h i c h you were e n t i t l e d was h e l d in a 14 c o d e d a c c o u n t in " A n s b a c h e r 's " nam e , 15 G u i n n e s s M a h o n C a y m a n T r u s t ' s n a m e as it t h e n 16 was, 17 A 18 160 Q 19 A 20 161 Q 21 Kennedy, in G u i nn e s s A 23 162 Q i n fact, the or i n & M a h o n in Du b l i n ? No. D i d y o u k n o w t h a t it w a s in a c o d e d a c c o u n t ? No, Yes. I didn't know. I w o u l d just like to r e f e r yo u to a letter. It is p a g e 22 a r e y o u a w a r e tha t, 66 ( E x h i b i t 2) (Same H a n d e d ) ? T h a n k you. It is a l e t t e r o f t h e 1 7 t h J u n e 1993. It is at 24 the time of the amnesty, 25 arranging, 26 T h i s is a l e t t e r f r o m T h e C a y m a n I n t e r n a t i o n a l B a n k 27 A n d Trust Company. 28 w i l l see. 29 to The Irish I n t e r c o n t i n e n t a l Bank? I think, the time you were to p a y the a r r e a r s of taxes. It is f r o m J o a n W i l l i a m s , T h a t is Mr. Traynor's secretary. you It is 1 2 163 Q. If I m a y p a u s e t h e r e ? Did you know that funds 3 over w h i c h you h a d control w ere in The Irish 4 Intercontinental Bank? 5 A. 6 164 Q. 7 A. 8 165 Q. 9 No. You did not know that? No. Did you t h i n k that your funds were still in some way associated with Guinness 10 A. 11 1 6 6 Q. Yes. D i d y o u k n o w that , Guinness 12 & Mahon? in fact, Mr. T r a y n o r h a d left & Mahon? 13 A. I k n e w h e l e f t. 14 Q. The date? 15 A. I do remember. 16 Q. Yes ? 17 A. I d i d k n o w h e l e f t at s o m e s t a g e . 18 Q. However, 19 A. Yes, 20 Q. That the funds were in G u i n n es s 21 A. Yes . 22 Q. Yes? 23 A. Yes . 24 Q. It is j u s t t h a t I can't remember just what date e ven th o u gh t he left you still a s sumed? I did. & Mahon? I w a n t to r e f e r yo u t h e r e in 25 this letter 26 Mr. 27 is r e f e r r i n g t o t h e m o v e m e n t o f f u n d s . 28 o n t h e t h i r d line: 29 ( E x h i b i t 2), w h i c h is a d d r e s s e d to R e d m o n d in The I rish I n t e r c o n t i n e n t a l Bank. It Y o u will see "H olding on dep o s i t u n d e r r e f e r e n c e B/P a n d B / Q ." 1 2 3 4 173 Q. Y o u w i l l see: 5 "DM s i n A c c o u n t Ref. B/P..." 6 7 A n d then : " US $ i n A c c o u n t Ref. 8 9 B/P." Y o u do not k n o w that that was the code u s e d in the account 10 11 A. 12 174 Q. 13 A. 14 175 Q. for your funds? No. Y ou do not know that? No, I don't k n o w tha t, Y o u d o n o t know, no. do you, that the account, 15 the funds over w hich you had control, 16 Guinness 17 A. 18 17 6 Q. 19 A. 20 177 Q. 21 A. in & M a h o n were also u nder the code B/P? No. Y ou do not know a n y t h i n g about that? No. C o u l d I just say? Yes? T h a t t h e 1 7 t h J u n e 1993, t h a t w a s -- t h a t is t h e date on that letter. 22 23 178 Q. 24 A. 25 T h a t is r i g h t , yes? That the amnesty thing didn't arise until December, N o v e m b e r o r D e c e m b e r 1993. 26 1 7 9 Q. 27 A. 28 180 Q. 29 that Yes? So, t h i s w o u l d n ' t h a v e b e e n c o n n e c t e d w i t h th a t . W e l l ... ( I N T E R J E C T I O N ) ? 1 181 Q 2 A 3 182 Q Yes . B e c a u s e -- y o u c a n t e l l me. The records show 4 t h a t y o u r m o n e y w a s m o v e d at t h a t t i m e t o t h e 5 I s l e O f Ma n. 6 A 7 183 Q 8 A 9 184 Q 10 A 11 185 Q Did you know that? No. You did not know that? No. D i d Mr. No. T r aynor tell you that this was b e i n g done? I h a v e n o r e c o l l e c t i o n o f t h a t a n y way. Y o u se e Mr. K e n n e d y the records s h o w tha t, fo r 12 reasons that have not yet b e e n divulged, 13 at t h i s t i m e in J u n e m o v e d a l l y o u r m o n e y t o t h e 14 Isle Of M a n and then b a c k a gain to Dublin. 15 not know that? 16 A 17 186 Q Mr. Traynor You did No. While I a m on t h i s s u b j e c t , I a m j u s t t r y i n g to g e t 18 y o u to b e as s p e c i f i c as y o u c a n be, 19 d e c i d e t h a t y o u w e r e g o i n g t o go t o T h e R e v e n u e a n d 20 m a k e a pa y m e n t of arrears of taxes? 21 decide that? 22 A 23 187 Q 24 A 25 Wh e n did you S o m e t i m e i n 1993. I a m j u s t w o n d e r i n g w a s it i n J u n e 1993? No. I t h i n k it is I think I am pret t y certain. m u c h l a t e r t h a n tha t. 26 188 Q 27 A 28 189 Q 29 when did you Yes? M u c h l a t e r t h a n that . I see. later? I know the actual payment was made much 1 2 190 Q 3 A 4 191 Q 5 A 6 192 Q 7 A Yes . O f 1 9 9 3 -- J a n u a r y 1994, the payment was made? T h e p a y m e n t w a s m a d e in J a n u a r y 1994. Yes? But the d e c l a r a t i o n was made, I think, in D e c e m b e r 1993. 8 9 193 Q 10 A 11 194 Q 12 A 13 195 Q 14 A 15 196 Q 16 A 17 197 Q I see? N o v e m b e r o r D e c e m b e r 1993. It w a s l a t e r t h a n t h i s ? Yes . Th a t . . . (INTERJECTION)? A n d I d i d n ' t d i s c u s s t h a t i n t e n t i o n t o d o th a t . There was talk? W i t h Mr. Yes. T r a y n o r u n t i l a r o u n d N o v e m b e r or December. I w i l l r e t u r n t o t h a t in a f e w m o m e n t s . 18 y o u l o o k at y o u r s t a t e m e n t , 19 statement 20 A 21 198 Q (Exhibit the se c o n d page of your 1)? Yes . Do y o u se e t h e p a r a g r a p h s t a r t i n g : 22 "In or a b o u t 1990 I d i s c u s s e d a r r a n g e m e n t s . .."? 23 24 25 A 26 199 Q Yes . "... u n d e r w h i c h A I B ..." ? 27 28 A 29 20 0 Q Yes . " . . . w o u l d a d v a n c e m o n e y for the 29 If p u r c h a s e a nd d e v e l o p m e n t of l and on the s e c u r i t y of a g u a r a n t e e to be g i v e n b y Guinness & Mahon..."? 1 2 3 4 5 Yes . 20 1 Q " . . . w h i c h m i g h t be p a r t l y s e c u r e d b y f u n d s in P e n t a I n v e s t m e n t s L i m i t e d . " ? 6 7 8 A 9 202 Q 10 A Yes . Can you r e m e m b e r the details of this? What I r e m e m b e r is Mr. T r a y n o r b e i n g in t o u c h with 11 AIB and I presume 12 w i t h A I B to c o n t a c t e a c h other, 13 to h a v e a c o n v e r s a t i o n w h e r e b y w o r d s of comfort, 14 l e t t e r s of comfort, 15 l e t t e r o f g u a r a n t e e or w h a t e v e r w o u l d p a s s . 16 20 3 Q 17 A 18 204 Q 19 A 20 20 5 Q 21 A Traynor to be in touch, and or w o u l d be e x c h a n g e d or that a Yes ? A n d . . . (INTERJECTION). A l e t t e r of g u a r a n t e e F r o m Mr. from? T r a y n o r t o AI B. Yes? To s u p p o r t t h e b o r r o w i n g s t h a t we h a d i n r e l a t i o n t o . . . (INTERJECTION). 22 23 I a r r a n g e d e i t h e r w i t h Mr. 206 Q 24 You say a guarantee: " T h e s e c u r i t y o f a g u a r a n t e e t o be given by Guinness & Mahon." 25 26 27 Is t h a t r i g h t ? A Yes, t h a t is w h a t I understood. 28 Yes. Then Guinness & M a h o n then in tur n w o u l d look 29 f o r s o m e s e c u r i t y f r o m y o u i n r e s p e c t of t h e 1 g u a r a n t e e a n d that was to be the funds of Penta 2 Investments, 3 Well, 4 it. 5 208 Q 6 A 7 is t h a t r i g h t ? h e d i d n ' t h a v e t o l o o k to m e b e c a u s e he h a d I m e a n h e w a s c o n t r o l l i n g Pe n t a . Yes ? So, I wasn't -- I d i d n ' t h a v e t o s i g n a n y t h i n g o r d o a n y t h i n g l i k e that . 8 209 Q 9 A 10 21 0 Q You did not sign anything? No. However, d i d y o u k n o w tha t, 11 Investment's 12 b e u s e d as s e c u r i t y ? 13 A 14 21 1 Q i n fact, that Penta i n t e r e s t in d e p o s i t s w e r e g o i n g to That was m y understanding. D i d y o u n o t a l s o k n o w Mr. K e n n e d y t h a t if you 15 w a n t e d to y o u c o u l d p e r s o n a l l y w i t h d r a w f u n d s 16 from the deposits which were held? 17 A 18 212 Q 19 A 20 21 3 Q 21 A 22 214 Q 23 A 24 21 5 Q 25 A 26 216 Q 27 A 28 217 Q 29 Yes, I d i d k n o w that. You did know that? Yes . Y o u did, in fact, withdraw personally, did you not? No. I a m . . . (INTERJECTION)? I don't recall. Perhaps your r e c o l l e c t i o n ...(INTERJECTION)? I don't recall. Y o u r r e c o l l e c t i o n is m i s t a k e n ? Yes . Because I j u s t w a n t t o d r a w y o u a t t e n t i o n t o t hi s . It is p a g e 50 a n d t h e n t h e b a c k i n g d o c u m e n t (Same 1 T h a n k you. 2 3 218 Q The p h o t o s t a t is n o t v e r y g o o d I a m a f r a i d . This 4 is t h e C a y m a n I n t e r n a t i o n a l B a n k & T r u s t C o m p a n y 5 L i m i t e d a c c o u n t in I r i s h I n t e r c o n t i n e n t a l B an k . 6 y o u se e t h a t ? 7 A 8 219 Q 9 A 10 22 0 Q 11 A 12 22 1 Q 13 A 14 222 Q 15 Yes . It is J u n e 1 9 9 3 ? Yes . Do y o u se e t h e e n t r y t h a t is h i g h l i g h t e d ? Yes . It is t h e 1 7 t h J u n e a n d it is a d e b i t of £ 9 , 8 3 5 ? Yes . If y o u j u s t t u r n o v e r t h e p a g e t o t h e b a c k i n g document? 16 A 17 22 3 Q 18 Yes . T h e c u s t o m e r is "CIBTC" 19 a n d y o u w i l l s e e t h a t t h e r e at t h e t o p ? 20 21 A 22 224 Q 23 Yes . Y o u w i l l see: "OUT TO - C l i e n t ' s Instructions" 24 25 f r a m e a n d y o u w i l l see: 26 "Cheque"? 27 28 A 29 "For o rder of John K e n nedy"? Do 1 2 3 2 2 6 Q. It w o u l d s e e m as if t h i s w a s a c h e q u e w h i c h w a s 4 p a i d out of the C a y m a n I n t e r n a t i o n a l Bank's 5 a c c o u n t in y o u r f avour? 6 A. Yes. 7 227 Q. 8 A. Yes, 9 228 Q. Yes. W o u l d you agree with that? it c e r t a i n l y d o e s s e e m l i k e th a t , It w o u l d s e e m t h a t y o u d r e w t h a t m o n e y f r o m this account. 10 11 A. 12 2 2 9 Q. 13 A. 14 23 0 Q. 15 A. 16 23 1 Q. 17 A. 18 232 Q. 19 A. 20 23 3 Q. yes. Can you remember that? I d o n ' t r e m e m b e r it. Y ou do not r e m e m b e r that? I d o n ' t r e m e m b e r it, no. It l o o k s v e r y c l e a r t h a t it h a p p e n e d ? C e r t ainly that w o u l d . ..(I N T E R J E C T I O N ) . W o u l d i n d i c a t e it? T h a t w o u l d i n d i c a t e it, yes. If w e c o u l d t u r n n o w t o t h e a m n e s t y ? Yes. H o w d i d it c o m e a b o u t t h a t y o u d e c i d e d t h a t T h e 21 Statute that was enacted by the Oireachtas 22 t i m e was one w h i c h a p p l i e d to you? 23 to that co n c l u s i o n ? 24 advice did you take? 25 A. 26 27 28 29 No, at t h a t How did you come Did you take advice and whose it w a s -- t h e r e w a s a l o t o f d i s c u s s i o n a b o u t it t h a t y e a r a n d I j u s t d e c i d e d t o d o it. 234 Q. W h o s e advice, w h o d i d y o u d i s c u s s it w i t h ? What p r o f e s s i o n a l a d v i s o r d i d y o u d i s c u s s it w i t h ? 1 2 23 5 Q. 3 A. 4 2 3 6 Q. 6 A. 7 237 Q. I took , I c o m p l i e d w i t h it. I t o o k the advice of Dan D e l a n e y and W h e n you say that you thought t h e A ct, I th i n k , it w a s t h e t h i n g to r e quired persons who owed tax to p a y u p t h e a r r e a r s ? 11 A. 12 238 Q. 13 A. 14 2 3 9 Q. 15 Yes. Y o u c a m e to t h e c o n c l u s i o n t h a t y o u o w e d t a x ? Yes. However, did somebody not advise you that you did o w e t a x o r d i d y o u w o r k it o u t y o u r s e l f ? A. 17 No, I knew that the m o n e y that was there h a d not be d e c l a r e d to T h e R e v e n u e . 24 0 Q. 19 Yes. However, you must have come to the c o n c l u s i o n t h a t it s h o u l d h a v e b e e n d e c l a r e d t o T h e R e v e n u e ? 20 A. 21 24 1 Q. Yes. I a m j u s t w o n d e r i n g d i d a n y b o d y a d v i s e y o u of t h a t or d i d y o u c o m e t o it y o u r s e l f ? 22 23 A. 24 242 Q. 25 A. 26 24 3 Q. No, I k n e w t h at . I knew that myself. Y o u k n e w it y o u r s e l f ? Yes. Mr. Delaney then arranged the payments and 27 n e g o t i a t e d on your b e h a l f w i t h The Revenue, 28 that right? 29 advice Whose advice did you take? do, 10 18 I got, Padraig Bennett. 9 16 A n d then having decided that as to h o w to m a k e s u r e t h a t 5 8 Yes? is 1 244 Q C a n y o u r e m e m b e r w h e n t h a t was, Mr. 2 D e l a n e y first of all? 3 A 4 24 5 Q Not before that? 5 A N o t b e f o r e tha t, 6 246 Q 7 w h e n y o u w e n t to N o v e m b e r o r D e c e m b e r of 1993. Yes. no. You have e x p l a i n e d that the do c u m e n t s which you had were destroyed? 8 A 9 247 Q Yes . However, in r e l a t i o n to t h e T r u s t Deed, can you 10 r e m e m b e r w h e t h e r or not you w o u l d have g i ve n that 11 t o Mr. 12 A 13 248 Q 14 A 15 249 Q 16 A No. You did not? No. Y o u m u s t h a v e h a d t h e T r u s t D e e d t he n , D e ed. 18 stage. 25 0 Q d i d you? I c e r t a i n l y h a d a d o c u m e n t if that was the Trust 17 19 D e l a n e y or p e r h a p s to y o u r l e g a l a d v i s o r ? I m e a n I c e r t a i n l y h a d a d o c u m e n t at t h a t Y o u d i d n o t g i v e that , a c o p y o f t ha t , to your legal advisors ? 20 21 A 22 25 1 Q 23 A 24 252 Q 25 A No. Or to y o u r a c c o u n t a n t s ? No. W h e n d i d y o u d e s t r o y it, Well, do y o u k n o w ? j u s t a b o u t -- I j u s t c a n ' t -- a r o u n d t h a t t i m e 26 a f t e r t h e -- a f t e r we h a d c o m p l e t e d t h e t r a n s a c t i o n 27 w i t h The Revenue. 28 r e t u r n s t h e r e w a s a s e n s e o f r e l i e f a b o u t it a l l a n d 29 it w a s j u s t d e s t r o y e d at t h a t st a g e . O n c e w e h a d m a d e a l l of t h e 1 25 3 Q 2 A 3 254 Q Do y o u r e m e m b e r w a s t h e L e t t e r O f W i s h e s d e s t r o y e d ? Yes, as w el l . H o w is it t h a t y o u h a v e s o m e d o c u m e n t s ? 4 t h a t y o u h a v e b e e n a b l e to s h o w us, 5 documents? 6 A Well, H o w is it g i v e us, W h y were the y not all dest r o y e d ? I t h i n k these were part of the par c e l that 7 w e n t w i t h t h e -- in c o m p u t i n g t h e t a x f o r t h e 8 p u r p o s e of t h e a m n e s t y . 9 25 5 Q Yes. C o u l d w e j u s t l o o k at t h e d o c u m e n t s 10 1) t h a t y o u h a v e f o r w a r d e d t o u s ? 11 t h a t is h e a d e d : "Investment 12 some (Exhibit Do y o u s e e o n e in G l o b a l Fun d " ? 13 14 A 15 256 Q 16 Yes . T h e r e is P e n t a a n d t h e n t h e r e is Tar a . Do y o u k n o w what Global Fund was? 17 A 18 257 Q 19 A 20 258 Q 21 A I don't. W h o g a v e y o u t h a t d o c u m e n t do y o u r e m e m b e r ? E m . . . (INTERJECTION). W a s it Mr. Traynor? I t h i n k -- I d o n ' t r e m e m b e r e x a c t l y . I don't remember. 22 23 259 Q 24 A 25 26 0 Q Y o u c o n t a c t e d Mr. Yes, Traynor, did you not? I did. W h a t was his a t t i t u d e to the fact t h a t yo u w e r e 26 g o i n g -- t h a t y o u w e r e a c c e p t i n g t h a t y o u s h o u l d 27 h a v e b e e n p a y i n g ta x on these, 28 W a s he -- d i d h e t r y to d i s s u a d e y o u f r o m d o i n g i t? 29 No, on this int e r e s t ? he e x p r e s s e d s u r p r i s e b u t n o t . . . ( I N T E R J E C T I O N ) . 1 26 1 Q 2 A 3 262 Q He d i d n ' t d i s s u a d e me. Do y o u se e t h e n e x t d o c u m e n t : 4 "Exchange Position" 5 do you know w h e r e that came from? 6 7 A 8 26 3 Q 9 A 10 264 Q No. No, I don't recall exactly. If y o u l o o k at t h e n e x t d o c u m e n t ? Yes . "On the b a s i s of t h e s e figures, s p l i t is as f o l l o w s . . . " ? 11 the 12 13 A 14 26 5 Q 15 A 16 2 66 Q 17 Yes . It is s i g n e d b y Mr. Yes . T h a t is d i v i d i n g u p t h e i n t e r e s t b e t w e e n t h e two companies, 18 A 19 267 Q Furze? is t h a t n o t so? Yes . Is t h i s as a r e s u l t of e n q u i r i e s w h i c h y o u 20 p e r s o n a l l y m a d e o r w h i c h Mr. 21 accountant, 22 A No, Delaney, your had made? I -- at t h i s s t a g e I t h i n k it is t o d o w i t h - ­ 23 it is t h e r e s p o n s e to m y r e q u e s t f o r i n f o r m a t i o n , 24 w h i c h is j u s t t w o d o c u m e n t s on, 25 w h i c h s t a r t s w i th: " T h e f o l l o w i n g is an o u t l i n e o f t h e information required." 26 27 268 Q 28 A 29 269 Q T h i s is o b v i o u s l y a p a r t o f a l e t t e r ? Yes . W h y h a v e yo u left out the e a r l i e r p a r t of the 37 1 2 3 27 0 Q 4 A Yes ? No, that was the letter. My recollection and my 5 a s s u m p t i o n at t h i s sta ge , 6 t y p e d i n m y o f f i c e in a w a y w h e r e t h e p e r s o n t y p i n g 7 it w o u l d n ' t 8 c o n v e y e d to Mr. 9 information I required. 10 27 1 Q However, I th i n k , is t h a t t h i s w a s k n o w w h a t it w a s a l l a b o u t a n d t h a t w a s T r a y n o r to s h o w t h e n a t u r e of t h e t h i s s e e m s t o m e t o b e j u s t p a r t of a letter: 11 " T h e f o l l o w i n g is an o u t l i n e o f t h e information required"? 12 13 14 A 15 272 Q 16 17 A Yes . I am just wondering, t h e r e is no, "Dear Mr. Traynor." T h e r e is n o . . . ( I N T E R J E C T I O N ) ? No, t h a t w o u l d h a v e b e e n s p e c i f i c a l l y e x c l u d e d as a 18 m a t t e r of the p e r s o n t y p i n g the l e t t e r not k n o w i n g 19 what was happening. 20 27 3 Q 21 Mr. 22 A 23 274 Q 24 Tray n o r should not be m a d e ava i l a b l e to us? Pardon? Is t h e r e a n y r e a s o n w h y t h e l e t t e r w h i c h y o u -- t h e full l etter w h i c h y o u ...(I N T E R J E C T I O N ) ? 25 A 26 27 5 Q 27 A 28 276 Q 29 Is t h e r e a n y r e a s o n w h y t h e l e t t e r w h i c h y o u s e n t to No, no. T h a t is -- I t h i n k t h a t is t h e f u l l l e t t e r . The full letter? I t h i n k t h a t is t h e c o m p l e t e d o c u m e n t . T h e r e w o u l d n o t h a v e l a n d e d o n Mr. a l e t t e r saying: Traynor's desk " T h e f o l l o w i n g is an o u t l i n e o f t h e information required"? 1 2 3 A. No, 4 Q. It m u s t h a v e b e e n as a r e s u l t o f d i s c u s s i o n ? 5 A. It was, 6 Q. Yes? 7 A. Yes . 8 Q. T h e n y o u said: 9 no, b u t I h a d d i s c u s s e d it i n . . . ( INTERJECTION yes. "NOTE: I T E M S NO. REQUIRED TODAY"? 1, 3, 4 and 5 ARE 10 11 A. 12 28 0 Q. 13 Yes. This was s e n t o n to h i m as a r e s u l t o f y o u r telephone conversation presumably, 14 A. 15 28 1 Q. 16 A. No, I m e t Mr. w a s t h a t it? Traynor. Yes? A n d s a i d I d e c i d e d to, w i t h Mr. McKeon, avail of the 17 a m n e s t y and t hen we said we w o u l d co n t a ct h i m with 18 w h a t e v e r i n f o r m a t i o n w e n e e d e d to get. 19 282 Q. 20 A. 21 28 3 Q. 22 A. 23 284 Q. 24 A. 25 28 5 Q. 26 27 A n d t h i s w a s t h e i n f o r m a t i o n t h a t w e n e e d e d to get. Yes? And required t o ...(I N T ER J EC T IO N ). You went with your accountant, did you? Pardon? Y o u w e n t w i t h y o u r a c c o u n t a n t t o Mr. Tray n o r or did y o u go b y y o u r s e l f ? A. 28 29 Yes? 2 8 6 Q. No, I w e n t w i t h Mr. Mr. M c K e o n a n d Mr. Mr? -- p a r d o n me, Bennett. I went with 1 Mr. 2 t h e a m n e s t y I d e c i d e d t o u s e Mr. 3 w h o is a t a x c o n s u l t a n t . 4 287 Q 5 A 7 288 Q 8 A 9 289 Q 10 A Yes. Padraig Bennett, from the firm you just mentioned? H e is n o t p a r t of B u c k l e y D e l a n e y . He was a Right? With S K C . W i t h who? SKC. K e n n e d y -- KPMG, is i t ? Yes, K P M G I th i n k , ye s . 11 12 29 0 Q 13 A 14 W h e n d i d y o u c o n s u l t Mr. Again, Bennett then? N o v e m b e r / D e c e m b e r , about this particular matter. 15 29 1 Q 16 A 17 292 Q 18 A 19 29 3 Q 20 A 21 W a s Mr. Bennett an accoun t a n t ? A tax consultant. A consultant? Yes . Did you say Stokes Kennedy Crowley? Yes, o r -- K P M G I t h i n k . W h a t e v e r th e y call themselves. 22 294 Q 23 A 24 29 5 Q 25 W h a t e v e r f i r m it w a s ? Yes . Yes. If y o u c o u l d j u s t g o b a c k t o t h e s e d o c u m e n t s t h a t w e w e r e l o o k i n g at 26 A 27 296 Q 29 W a s he d i f f e r e n t o n e I d e c i d e d to u s e tax co n s u l t a n t . 6 28 Bennett was a tax advisor, (Exhibit Yes . The one headed: "Penta Investments Limited." 1)? Then: 1 2 3 4 Then: 5 " A s s e t s as at 5 t h A p r i l 1992." 6 7 Then: " A s s e t s as at 5 t h A p r i l 8 1993." 9 10 T h a t is w h a t Mr. 11 that right? 12 A 13 297 Q 14 A 15 298 Q 16 is Yes . Yes. T h e r e is a l e t t e r o f t h e 7 t h J a n u a r y 1 9 9 4 ? Yes . In w h i c h Mr. R e d m o n d w a s a s k e d fo r c h e q u e s p a y a b l e to The Reve n u e C o m m i s s i o n e r s ? 17 A 18 299 Q Yes . Do you know who s i g n e d this letter, it w a s 42 Fitzwilliam Square? 19 20 A 21 30 0 Q 22 A Sean McKeon. 23 30 1 Q Sean McKeon. 24 Yes . Who signed this letter? W a s t h a t o n y o u r b e h a l f or o n b e h a l f of h i m s e l f ? 25 A 26 302 Q 27 A 28 30 3 Q 29 T r a y n o r w o u l d h a v e g i v e n you, Both. Both? Yes . What was offices ? 42 F i t z w i l l i a m S q u a r e ? What were those 1 2 304 Q 3 A 4 30 5 Q De s T r a y n o r ' s o f f i c e ? Yes . It w a s Mr. McKeon, your partner, that signed this 5 l e t t e r h a v i n g -- p r e s u m a b l y it h a d b e e n t y p e d u p in 6 his office? 7 A 8 306 Q 9 A 10 307 Q In Mr. Mr. Traynor's office, Yes, Mr. Traynor's office I assume. yes? yes. Kennedy, I propose, if it is a l l r i g h t w i t h you, 11 to h a v e a s h o r t a d j o u r n m e n t n o w f o r a c u p of c o f f e e 12 for about ten m i n u t e s ? 13 A 14 308 Q Yes . If y o u w o u l d l i k e t o s t a y h e r e a n d y o u c a n h a v e a 15 c u p of c o f f e e i f y o u w o u l d l i k e o n e a n d w e w i l l b e 16 b a c k in about ten m i n u t e s ? 17 A Okay. 18 SHORT ADJOURNMENT 19 20 21 309 Q MR. JUSTICE COSTELLO: remaining. 22 23 c o u l d w e go b a c k to y o u r l e t t e r , 24 A 25 31 0 Q 26 A 27 31 1 Q 28 29 Just a few questions now Mr. Kennedy, your statement? Yes . Of the 15th March? Yes . Do yo u see the last p a r a g r a p h starting: "The funds to be h e l d on t r u s t w e r e I b e l i e v e a s s i g n e d b y m e to a c o m p a n y called Penta Investments Limited." 1 2 I t h i n k I a s k e d y o u t h i s b e f o r e Mr. 3 did you know whether the funds that you were giving 4 o v e r w e r e s e n t t o P e n t a I n v e s t m e n t s d i r e c t or 5 w h e t h e r t h e y w e n t to the T r u s t e e s ? 6 No. 7 312 Q 8 A 9 31 3 Q Kennedy, but Y ou do not know? I d o n ' t know. C o u l d y o u j u s t go d o w n t h e p a r a g r a p h a l i t t l e b i t w h e r e y o u say: 10 "The a c t u a l t r a n s f e r of funds was m a d e in a b o u t S e p t e m b e r 1986. Some of t h e m o n e y w a s t r a n s f e r r e d t o Mr. P a d r a i g C o l l e r y . " 11 12 13 14 T h a t is t h e i n c i d e n t y o u d e s c r i b e d e a r l i e r ? 15 A 16 314 Q 17 A 18 31 5 Q T h a t is r i g h t , yes. W h e r e y o u h a d c a s h a n d y o u g a v e it t o Mr. Yes, yes. "At t h e B a n k o f I r e l a n d , Dublin and the remainder t r a n s f e r r e d to the t r u s t accounts with Guinness & 19 20 C o l l e g e Green, was direct from Mahon"? 21 22 A 23 316 Q 24 A 25 317 Q 26 A 27 318 Q 28 A 29 319 Q Yes . Did you have accounts in G u i n n e s s & Mahon? Yes . Existing accounts? Yes . These were then transferred you assume? Yes, yes. Collery? 1 2 3 Yes. 4 d i s c l o s e d to The R e v e n u e the i n t e r e s t on the 5 deposits which you should have d i s c losed and you 6 d i d not, 7 w hich you had? 8 or G u i n n e s s 9 the funds that you had then? 10 A 11 32 1 Q 12 A A f t e r y o u p a i d t h e a r r e a r s o f tax, y o u h a d n o t don e, Yes ? No. I didn't recall until I n t e r c o n t i n e n t a l Ban k, 15 d o w n from. A 18 32 3 Q 19 No. A 21 324 Q However, 23 A 24 32 5 Q 25 The that the funds were drawn I am j u s t ...(INTERJECTION)? Sorry. Mr. C l a r k e is r i g h t . I am not concerned, we are not with your private tax affairs? No. However, it is o n l y i n r e s p e c t of y o u r d e a l i n g s w i t h the company, 22 I w e n t t o l o o k at t h e r e c e n t l y t h a t it w a s t h r o u g h t h e IIB, concerned, 20 i n r e l a t i o n to At the time of the a mnesty? 14 17 " A n s b a c h e r " i n a n y way, & M a h o n i n a n y way, papers 322 Q did you use the funds Did you use 13 16 and you with "Ansbacher"? Yes . What I w a n t to k n o w is, a f t e r 1993 h a d you any further dealings with "Ansbacher"? 26 A N o n e at all. 27 326 Q N o n e at a l l ? 28 A 29 327 Q No. 1 the D e e d of T r u s t an d the L e t t e r Of Wi s h e s . 2 u n d e r s t a n d from what you have said in your 3 statement, 4 these were destroyed? 5 Yes . 6 328 Q 7 A 9 329 Q "Ansbacher" in Yes . I w o n d e r c o u l d w e a s k y o u to w r i t e t o " A n s b a c h e r " to produce these documents? 10 A C o u l d I just say that m y s o l i c i t o r d i d the co r r e s p o n d e n c e with those banks. 12 13 33 0 Q 14 A 15 33 1 Q 16 the original should be with that the C a y m a n Islands? 8 11 However, a n d w h a t y o u h a v e t o l d us, I Yes? M a y I a s k m y s o l i c i t o r t o f i l l y o u in. Yes, MR. of course, yes. CLARKE: W e did, 17 Sir, i n f a c t -- well, I s h o u l d s a y t h a t we 18 h a d h o p e d that we w o u l d be able to o b t a i n this 19 material 20 to t h e I n s p e c t o r s i n i t i a l l y , 21 t hat, 22 T h e y r e c e n t l y t o l d us t h a t t h e y w e r e m i s t a k e n , 23 they do not have such information. 24 MR. JUSTICE COSTELLO: Yes. 25 MR. CLARKE: We have r e cently written, from Guinness in fact, & Mahon, as I t h i n k w e w r o t e and had understood they would have such information. 26 by "recently" that I mean about 27 a w e e k ago, 28 Guinness 29 p a r t i c u l a r l y for i n f o r m a t i o n a bout Penta. in t h e l i g h t o f t h a t i n f o r m a t i o n f r o m & Mahon, to " A n s b a c h e r " t o a s k t h e m We have 1 2 MR. JUSTICE COSTELLO: Yes. 3 MR. CLARKE: I d o n o t -- o f c o u r s e , we can write specifically 4 5 a s k i n g f o r t h e T r u s t Deed. 6 MR. JUSTICE COSTELLO: I w a n t yo u s p e c i f i c a l l y to w r i t e f o r t h e T r u s t Deed . 7 8 MR. CLARKE: Yes. 9 MR. JUSTICE COSTELLO: A n d the L e t t e r Of Wishes. 10 11 MR. CLARKE: A n d the L e t t e r Of Wishes. 12 MR. JUSTICE COSTELLO: V e r y w e l l the n. 13 MR. CLARKE: Yes. 14 15 E N D O F E X A M I N A T I O N O F MR. 16 MR. JUSTICE COSTELLO MR. JUSTICE COSTELLO: J O H N K E N N E D Y BY 17 18 T h a n k you. Mr. 19 Kennedy, V e r y we l l . t h a n k yo u for 20 your attendance. 21 s i g n t h e t r a n s c r i p t w h e n it h a s b e e n t y p e d up ? 22 A . W e w i l l a s k y o u it t o c o m e in to Yes. 23 MR. JUSTICE COSTELLO: T h a n k you. 24 MR. CLARKE: T h a n k you. 25 A. T h a n k you. 26 MS. 27 THE E X A M I N A T I O N WAS THEN C O N CLUDED 28 29 MACKEY: T h a n k you v e r y much. 9x Tuna 0 73 M e rrio n V illag e D u b lin 4 Office o f the Inspectors appointed by Order o f the High Court to Ansbacher (Cayman) Ltd 3rd Floor Trident House Blackrock Co Dublin % IS March 2000 Private & Confidential , . Dear Sir I refer to your letter to me dated 20 January 2000 and to subsequent correspondence between you and my solicitors. As my solicitors have informed you on my behalf, I did arrange for the establishment of a trust of a kind which I believe probably corresponded to the description at point (1) of appendix C attached to your letter. As they have also explained, I now have practically no records relating to the trust and although, as I explain below, I have sought material from two banks who may have such records, I have not yet received any. Without being able to refer to such material, I am not able to recall specific details as to the arrangements put in place, but I understand that the Inspectors would like to have a written statement at this stage of matters which I do remember. To the best of my knowledge and recollection I established the trust in about September 1986 following discussions with the late Mr Desmond Traynor when Mr Traynor told me that interest on funds in such a trust would not be liable to Irish tax. As far as I can recall my understanding was that the trust was to be established in the Cayman Islands but that the money would be held in Ireland with “matching funds” held off-shore. I was introduced to Mr Traynor by Guinness & Mahon and probably by Mr Maurice O’Kelly who had previously worked with that bank. At the time Guinness & Mahon held money on deposit for companies associated with me. Such companies had also previously acquired two properties from the bank. Mr O’Kelly was the senior person with whom I would normally have dealt. * The funds to be held on trust were I believe assigned by me to a company called Penta Investments Limited, incorporated in the Cayman Islands. At about the same time I recall signing a form of deed of trust and a letter of wishes addressed to the trustees. I assume that the company was established and those documents were prepared by Guinness & Mahon or Mr Traynor, because I did not personally arrange these things or arrange for any other professional adviser to cany them out. The actual transfer of funds was made in about September 1986; some of the money was transferred to Mr Padraig Colliery (who I understood to be acting for Guinness & Mahon and Mr Traynor) at the Bank of Ireland, College Green, Dublin and the remainder was transferred to the trust direct from accounts with Guinness & Mahon. I do not believe that I ever subsequently transferred further funds to the company or the trust (or to any other company or 5 March 2000 Page 2 trust associated with Mr Traynor or with Ansbacher (Cayman) Limited). Prior to repayment of these funds to me (in the circumstances described below), I do not believe that I ever received any money in respect of the funds from Guinness & Mahon, Ansbacher (Cayman) Limited or Mr Traynor. /■“' : '.) / "’s From time to time I received statements of the amounts held in the trust; these were infrequent. The statements were arranged by or through Mr. Traynor. I was asked from time to time in what currency I wished to have the funds or parts of the funds denominated and I chose currencies from time to time as I thought these most profitable (although I do not know whether any funds of mine were ever actually converted). So far as I can recall the only persons to whom I would have spoken about this were Mr O’ Kelly, Mr Traynor or, possibly, Mr Traynor’s secretary, Joan Williams. These communications were all verbal. In about 19901 discussed arrangements under which AEB, who wore bankers to various property development companies in which I was involved, would advance money for the purchase and development of development land on the security of a guarantee to be given by Guinness & Mahon which might be partly secured by funds in Penta Investments Limited. The purchase and development of the lands proceeded but I do not recall whether these particular security arrangements were proceeded with. As already mentioned I am awaiting information from AIB as to whether such arrangements were ever entered into. In 19931 availed o f the Waiver of Certain Tax, Interest and Penalties Act 1993 to declare to the Irish Revenue the amount of tax, calculated as provided for by that Act, which were owed in respect o f the funds in the trust. With the.assistance of my accountant Mr Dan Delaney of Buckley Delaney & Co (who had not been involved in establishing the fund or the trust), I calculated the amount of the fund and the interest which had been earned upon it For this purpose I wrote to Mr Traynor, who arranged for some details of the sums involved to be provided. I do not recall any direct contact with Mr John Furze (whose name appears on one of the documents attached) in relation to this information or at any other time, although I believe I may have met him once with Mr Traynor in Mr Traynor’s office around the time of establishment of the trust in 1986. A substantial part of the funds were payable by way of tax either by me or by companies associated with me and I arranged with Mr Traynor for the re­ payment of all of tiie funds. I do not recall the details of these instructions, but I believe that the payments were made by Irish Intercontinental Bank Limited, partly in the form of cheques made payable to the Revenue Commissioners. Shortly after having made the appropriate payments to the Revenue and having received their receipt (and I believe not later than the end of January 1994), I arranged for such limited materials as I had at the time relating to the fund, the trust or Penta Investments Limited (other than papers produced in the calculation of the amount due to the Revenue Commissioners) to be destroyed - my recollection is that other than the Amnesty working papers the only other materials which I would have had at the time were the trust deed, the letter of wishes and possibly some copies of previous statements received from Mr Traynor. Having paid the taxes due under and in accordance with the Amnesty and having re-established the balance elsewhere, there was no point in preserving any of the materials other than those which were relevant to the calculation of tax payable under the Amnesty. r \ 5 March 2000 Page 3 In the papers produced in the calculation of tax due there are working papers prepared by Mr Delaney, a short financial statement of eight lines headed ‘Investment in Global Fund’ apparently showing values as at 30 September 1993 o f Penta’ and ‘Tara’. There are also similar statements headed ‘exchange position’ stating what were said to be ‘overall realised gain(s)’ as of 1 September 1993; the final page from what appears to be a letter from Mr Furze dated 6 December 1993 which shows ‘the split’ of what appears to be earned interest for the year ending 30 September 1991 and the two years ending 30 September 1'993 and a page setting out what appeared to have been regarded as the assets of Penta Investments Limited as of 5 April in each of 1991,1992 and 1993. There is also a copy of a list of questions which I sent to Mr Traynor at the time when the amounts due under the Amnesty were being calculated, seeking information as to sums involved. I attach a copy of these papers (other than the working papers) on which I have covered up the amounts of money involved as invited by your letter of 20 January. The ‘Tara’ referred to above is I believe a company established on the instructions of my former partner Se&n McKeon with whom I believe the Inspectors have been in communication and who I believe established a fund of a similar kind to that established by me. I also have copy of a letter dated 7 January 1994 written by Mr McKeon to Irish Intercontinental Bank Limited from which I have derived the information which I have given as to the final repayment of the fund. I am enclosing a copy of this letter also and have notified Mr. McKeon that I am so doing. Having regard to what is said in your letter, my solicitors have on my instructions written to both Guinness & Mahon and to AIB to ask them for copy of any material which they have relating to the fund established by me or the prospective guarantee respectively. I attach copies of my solicitors’ letters. My solicitors advise me that they have been informed by Guinness & Mahon that Guinness & Mahon have record of having papers in connection with Penta Investments Limited, but these papers have not yet been produced to me. Signed a\SOt(UC£M4EDY\STATB03.WPD Investment in Global Fund PENTA 3o , 37466 Per Balance Sheet Less Discount Net Cost TARA '1 f * * 46324 Per Balance Sheet Less Discount Net Cost Exchange Position. PBNTA 3 0 /9 /9 1 3 0/9/93 Less: Loss '90 O n a 1 -t r* < > ! 1 •+ • 0 * n f« « ih » i> 1 0 O I ct-/r a "On the basis o f these figures, the split is aa M o w s: p ^tr rtiR & r Y ew to 3 0 -0 9 -9 1 H year to 0 3 -0 4 -9 1 V4 year to 3 0 -0 9 -9 1 . ,,,..........^u €. T w o y e a r s V4 year to Vi y ear to Vi y ear to V4 y ear to t o 3 0 -0 9 -9 3 0 5 -0 4 -9 2 3 0 -0 9 -9 2 0 5 -0 4 -9 3 3 0 -0 9 -9 3 . • . — - **** I io » jr V -— W V *V OuMimy, MonaM, Swlwtaral, W» ofM m ,Mamat. Otjmwn total**, Mlih VVfllrtl*«ndi 1 2 /0 1 /> 3 1 6 :0 4 73809 #49 #267 C . I .B . T .C . • ® . ' j . • _____ p e n t a i n v e s t m e n t s L IM IT E D \ AM CttM aabAwttM l , j' STSRtJwg £" DMK' pbutsghmarks U.S.DQULAK5 USD Await y n mUNG , ^ £ fAiq c s U A DQ I-LA Bfi DMK. / USD ' / • tatSAAjpfllM a PSCTSCBMABKS ., ^ wa . SX fflU JN q v / . fi DMK " ! I C a y m a n In tern a tio n a l B a n k a n d T ru st C o m p a n y L im ite d P.C. Box 837,Grand Cayman, Cayman Islands, British West Indies Telephone (809)949-8655 Tele* CP 4305 Facsimile (809)949-7946 ? Ic a se rep ly to: 4 2 F itzw illiam S quare, D ublin 2. T el: 6765144/676 3065 F ax: 6 6 1 2 0 3 5 CFonneriyAnsbacfag-I jr n rt^ 1 7 th Ronan Redmond, Esq., Corporate Services, Irish Intercontinental Bank Limited, 91 Merrion Square, ' DUBLIN 2. Dear Ronan, . . Further to our letter of yesterday's date in connection with the US Dollars and DeutscheMarks which you are holding on deposit under reference B/P and B/Q, could you please arrange value 29th June to transfer principal and interest in each case to: Bank of Ireland, International Dept., Head Office, Lower Baggot Street, Dublin 2, for the following Accounts: ^ DMs in Account Ref. B/P to DEM Account No. 31525301 US$ in Accotint Ref. B/P to US$ Account No. 31525300 tr r »» ^^ ^ ® DMs in Account Ref. B/Q to DEM Account No.31526301 US$ in Account Ref. B/Q to US$ Account No.31 526300 It would be appreciated if you could advise the exact amounts being transferred so that we can in turn advise Bank of Ireland. Could you also please arrange value 29th June to transfer two amounts of Sterling as follows, debiting both sums to our No.1 Account No.02/01087/81 . These should also go to Bank of Ireland. Stg.£500,000 to GB£ Account No.31525302 Stg.£375,000 to GB£ Account No.31526302 l5V . 9 \"C? Please advise if you have any probl* s or if anything is not clear. Yours sincerely, t —■. Ftfr CAYMAN INTERNATIONAL BANK AND TRUST CO. LTD. Guernsey -Monaco -Zurich -Nassau -Cayman -BVI f / V CAYHAN HTERN ATIO M L BANK I TRUST CONPANY L I * I T £ J C/O CGAPORaTc SExVICiiS ATTN M n riEUftO‘ A /C ) 0 2 /0 1 0 3 7 /d l GBP JEP CL tie * nun *£S PAliE DATI no: BAN T«l«phooe: (QU64I97JJ T«l«x: 33322 Facsmik: 101)6711074 ' ■* A S C ilvS CCPY » • * t* t*m*ntdat*. 000 OoCCT94 VAUM OATS MTMU J.JU L9 3 drlC JGhT FCSrfASO RE I t I J la l O *JTHD3»VAL VAL .2»Co9J . . . . ...... .* ■AkANCi 6,75?»6C 3 7 5 ,3 0 0 .9u . 3«JUN93' J* 0itJwL93 <2JwL93 u'lTM&ftA-AL uT 131652 Q2JOL43 F a t/» , 6 0*742 03J oL t 3 O JO L92 H tv Cm x *TS S.o«750u00 0>JwL93! 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I T mOh A.AL 2 i.J jl.9 3 OT 1 3 2 5 o l .ITrtOriAkAC 25JuL«3 FA C/h io o l-1 6 JuJUL93 F a C/r.__ f ta tlO l . -------- 1 JuJliLyS 1 ,* .0 1 .4 3 ! 2 , 1 0 « . l« 5 , ‘ i s , 75! 5 ,8 H ? ,7 7 9 4 ,5 4 5 .^ 9 4 , 5 * 5 . i5 *•77.5 7 *£ 3 .0 9 3 J 1 .J 3 E .1 0 1 , 3i»0.0b 5 , J 7 * , 793 5 ,5 4 7 ,2 3 4 5,546.23* 2 ,0 0 0 .1 0 < 0 ,9 3 6 .0 0 4 ,4 2 4 .1 .7 * ,6 o 0 .0 u 1 4 ,3 3 0 .9 9 7 5 ,w 00 .U 0 1 ,5 1 7 .0 7 2 4 ,0 0 0 .0 . I,0 ti0 . 0 d 9 fc 5 .3 i 5 , 3 2 8 , ia * 5 ,5 2 7 ,9 4 9 S . 6 1 7 ,4 0 8 . 5 ,4 1 5 ,9 7 1 . 5 ,5 9 C ,« 2 6 . 1 1 , 7 1 4 .^ * . 5 * 6 0 3 , 7*i Qi OVmOHAWNMLANCn AM MAI Ctoaai «mm feat wtiii w»h>«d i «Imw» <• M t mpfnm mm Hite Mi A ppendix X V (62) D r Colm Killeen 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Dr Colm Killeen. a) Transcript of evidence of Dr Colm Killeen dated 15 February 2000. b) Cheque dated March 1991 - IIB payable to CMT Killeen. c) Letter of 28 February 1991 - Ansbacher Limited to IIB. d) Letter of 10 June 1992 - Ansbacher Limited to IIB. e) Letter of 8 June 1992 - Ansbacher Limited to IIB. f) Letter of 11 June 1992 - Ansbacher Limited to IIB. g) Letter of 26 June 1990 - JD Traynor to Guinness and Mahon. h) Letter of 12 November 1990 - JD Traynor to Guinness and Mahon. i) Letter of 10 June 1991 - JD Traynor to Guinness and Mahon, j) Letter of 5 July 1993 - JD Traynor to Guinness and Mahon, k) Letter of 22 May 1990 - JD Traynor to Guinness and Mahon. Correspondence received from or on behalf of Dr Colm Killeen. a) Letter of 20 December 2001 - Eugene F Collins to the Inspectors. UNDER OATH ON TUESDAY, 15TH FEBRUARY 2 0 0 0 I hereby c e r t i f y the f o l l o w i n g t o b e a t r u e and accurate tra n sc r ip t shorthand n o tes o f my in the a b o v e named i n t e r v i e w . Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY BL S olicitor to the Inspectors MS. M. CUMMINS Interview ee: DR. COLM KILLEEN Accom panied by: Mr. T. Leggett E u g e n e F. C ollins T e m p l e Chambers 3 B u r l i n g t o n Road Dublin 4 WITNESS DR. T.C. KILLEEN I EXAMINATION MR. JUSTICE COSTELLO MS. MACKEY MR. ROWAN MR. JUSTICE COSTELLO PAGES 36 - 29 35 38 1 2 15TH FEBRUARY 2 000 3 4 DR. 5 AS FOLLOWS, COLM KILLEEN, HAVING BEEN SWORN, WAS EXAMINED, BY MR. JUSTICE COSTELLO 6 7 1 Q. MR. JUSTICE COSTELLO: Dr. 8 your s o l i c i t o r , 10 statem ent, 11 to u s? 12 A. 13 2 Q. Mr. Leggett, We a c c e p t t h a t . It is u n n e c e s s a r y f o r you t o r e a d 15 s t a t e m e n t a nd we w i l l p u t i t 16 in terview ? A. 18 3 Q. 19 A. y o u w i s h t o make Yes. it, 17 m o r n i n g f r om a p relim inary w h i c h we u n d e r s t a n d t h a t 14 21 we h a v e received th is 9 20 K illeen , we w i l l accept th is as your p r e lim in a r y into the record of th is Very w e l l . If you w ould l i k e to sign it. Yes. " P r e l i m i n a r y S t a t e m e n t b y Dr. T . C . K ille e n to the Joint Inspectors I n v e s t i g a t i n g A n s b a c h e r (Cayman) L im ited. 22 23 24 25 26 27 28 29 I wish to s t a t e at th e o u t s e t o f t h i s i n t e r v i e w t h a t my p r e s e n c e h e r e i s a t your d i r e c t i o n , a c t i n g as you a r e under t h e p o w e r s c o n f e r r e d u po n y o u b y t h e C o m p a n i e s A c t 1 9 90 a n d b y t h e C o u r t . I h a v e n o t come t o t h i s i n t e r v i e w v o l u n t a r i l y and an y s t a t e m e n t s or c o n f e s s i o n s a r e made u n d e r t h e c o m p u l s i o n o f my i n v o l u n t a r y a t t e n d a n c e here. H a v i n g s a i d t h a t , i t i s my d e s i r e and i n d e e d o b l i g a t i o n t o co -o p era te f u l l y with the i n v e s t ig a t io n a nd I s h a l l a n s w e r y o u r q u e s t i o n s a s c o m p l e t e l y a n d t r u t h f u l l y a s I am a b le." 1 2 4 Q. 3 4 Doctor, I am g o i n g t o a s k Ms. questions A. Ma ck e y t o a s k y o u some first? Yes. 5 6 END OF EXAMINATION OF DR. 7 COSTELLO KILLEEN BY MR. JUSTICE 8 9 DR. KILLEEN WAS EXAMINED, AS FOLLOWS, BY MS. MACKEY 10 11 5 Q. MR. MACKEY: Doctor, 12 would t e l l 13 little 14 F irst 15 A. 16 6 Q. 17 A. 18 7 Q. 19 A. 20 8 Q. 21 A. b it of a ll, y o u r f u l l name i s Yes, I am. A re y o u a g e n e r a l p r a c t i t i o n e r ? A fam ily p r a c titio n e r , You a r e i n p r a c t i c e I am i n p r a c t i c e yes. at present? at present. moment I am p r a c t i s i n g 24 d id have a s u r g e r y in 25 a disastrous fire Can y o u t e l l u s when y ou f i r s t 28 29 A. . . . (INTERJECTION). You a r e a m e d i c a l d o c t o r ? 23 27 a Thomas C o l u m b i a K i l l e e n . practice 9 Q. us f i r s t y ou a b o u t y o u r s e l f a nd y o u r q u a l i f i c a t i o n s . 22 26 I wonder i f in D ub i n s i n c e I have been in 1 s t March 1 9 5 5 . in At t h e 14 M o u n t j o y S q u a r e . 67A M o u n t j o y S q u a r e and we h ad a b o u t t wo y e a r s ago. came i n c o n t a c t w i t h A n s b a c h e r Cayman a n d how t h a t came a b o u t ? That i s The f i r s t a d ifficu lt We o n e now. I knew o f t h e w or d " A n s b a c h e r " was a b o u t t wo t o t h r e e y e a r s 1 before 2 t h a t he was r e s i g n i n g 3 A nsbacher would be ta k en o v e r . 4 illo 5 I n e v e r h e a r d t h e name m e n t i o n e d b e f o r e t h a t . 6 10 Q. Des T r a y n o r d i e d , tempore, Perhaps 8 tim e p r io r to th a t? Traynor? Yes, c h a i r m a n s h i p and t h a t To b e t r u t h f u l You knew Mr. I did. It is T r a y n o r t h e n f o r some a sligh tly in v o lv ed item . I first 11 G lennon's o f f i c e 12 Company w e r e my i n s u r a n c e p e o p l e a t t h a t t i m e . 13 reme mbe r g o i n g i n t o 14 t h e Quays a t t h a t 15 v e r y one o f n a t u r e ' s 16 Glynn, 17 But, 18 th eir 19 s e p a r a te arrangement 20 were 11 Q. met Mr. accountant Sorry, 29 t h e Glennon o f f i c e tim e. w h i c h was on The man I d e a l t w i t h was a gentlem en, o h, I a man c a l l e d G e r r y he d i e d s h o r t l y a f t e r at that Des T r a y n o r b e c a u s e tim e. Des s e t f o r us b e c a u s e that. Des was up a e v e n t h o u g h we lik e to take th is for you, in sta g e s. b u t I would He s e t up t h i s . . . (INTERJECTION). He a s k e d me t o v i s i t him i n H a u gh e y B o l a n d ' s o f f i c e s i n Ami en S t r e e t . 12 Q. 27 28 F r a nk G l e n n o n F r a nk G l e n n o n & I d o n ' t w a nt t o c u t a c r o s s arrangement 26 in ...(INTERJECTION). 23 25 1957, on t h e Q u a y s . he i n t r o d u c e d me t o just A. Traynor c i r c a who d i e d - - 22 24 in because 10 21 say I c o u l d a s k y ou w h a t y o u r c o n t a c t w i t h Mr. A. from h i s I t h o u g h t A n s b a c h e r was a man, 7 9 a nd h e w r o t e t o me t o What c a u s e d him t o a s k y o u t o v i s i t spoken A. him? Had y ou ...(INTERJECTION). I h a d no a c c o u n t a n t and Mr. s h o u l d do t h i s . Glennon s u g g e s t e d t h a t When we w e r e t u r n e d o u t o f I 1 U n iv e r sity C ollege 2 m e d i c i n e u n d e r my arm, 3 knew n o t h i n g a b o u t a n y t h i n g e l s e , 4 accountant th at 5 s h o u l d h a v e o n e a nd he s u g g e s t e d Mr. 6 13 Q. 7 A. 8 14 Q. 9 A. 10 15 Q. 11 A. in 1951, with a degree of I knew a l l t i m e and Mr. My w i f e a nd m y s e l f w e r e i n p r a c t i c e You w e r e i n p r a c t i c e together. Yes. Your w i f e is Ita K illeen , Dr. Ita K illeen? yes. I v i s i t e d Mr. method o f 14 p r e s e n t day. 15 fees 16 sim ple 17 w o u l d h a v e s e e n h im up t o a b o u t 18 that 19 m ov ed h o u s e - - 20 in i l l o 21 Howth Road c a l l e d 22 to A. Traynor. together? 13 24 I When y o u s a y "we"? office 16 Q. I an d we h a d no Glennon s u g g e s t e d 12 23 about m ed icin e, Traynor i n h i s i n Amie n S t r e e t a n d h e s e t keeping books, earned, The n, Then I l o s t use to the sheet, banked. A maybe o n c e o r t w i c e , 1962/63/64, c o n t a c t w i t h hi m, I used to sim ple c o l u m n s on t h e n o t b a n k e d an d f e e s arrangement. tim e. w h i c h we s t i l l There were t h r e e fees up t h i s liv e in St. around u n til we L a w r e n c e Road t e m p o r e t h e n we m o v e d h o u s e t o 'B elvedere', I a house in w h i c h was n e x t d o o r Des T r a y n o r . When was t h a t ? 1977, May/June 197 7. We b o u g h t t h e h o u s e i n 25 b u t we w e r e n ' t 26 contract 27 com pleted fo r s i x months. 28 we m ove d t h e n i n t h e m i d d l e o f 29 t o do a l o t a l l o w e d t o move i n t o sta ted at that tim e i t Why, it. 1976, The w o u l d n ' t be I don't 1977. know. But My w i f e u s e d o f d o m i c i l i a r y m i d w i f e r y and one o f 1 the th in gs 2 m idw ife, 3 u s e d t o do a l o t 4 p articu larly 5 u sed t o have a whole l o t 6 g irls 7 d eliver 8 R oad . 9 a nd we w e r e s h o r t a d o m e s t i c a t t h e t i m e , that she u s e d t o do, h erself a nd a r a n a n u r s i n g home on t h e Howth Ro a d. She o f c h a r i t y wo r k, for the famous F a th e r C l e a r y , o f th e s e poor u n fo rtu n a te t h a t he u s e d t o c o l l e c t them i n S t . and he and s h e u s e d t o A n t h o n y ' s N u r s i n g Home i n Howth One o f t h e s e girls wanted t o keep t h e baby s o we 10 o ffe r e d to take t h is 11 did. 12 who was a s i m i l a r a g e t o t h i s 13 looking a fte r 14 one Sunday t h e y w ere i n n e x t d o o r and t h e y were 15 blowing in to 16 them b i t th is 17 or 1983. Mr. 18 about t h i s 19 to 20 deal with i t 21 . . . (INTERJECTION). 22 17 Q. As t i m e w e n t o n, 24 first youngster. y o u n g s t e r t h a t we w e r e eyes 25 relation sh ip a nd s t i t c h e d . 1 98 2 m yself, p ersonally, cut across tryin g I had d e c i d e d n o t t o you, Dr. to e s ta b lis h some s o r t because of the K illeen , here i s b u t wha t when y o u o f com mercial . . . (INTERJECTION). Mr. 27 come i n o n c e o r t w i c e a nd h e s a i d , 28 w ill 29 after th is and one o f T h is would be abo ut w ha t I am c o m i n g t o . talk ." and T r a y n o r came i n a n d was v e r y u p s e t entered in to That i s Des T r a y n o r h a d a y o u n g s o n Des T r a y n o r ' s d o g s ' not to I am r e a l l y A. w h i c h we an d t h e y u s e d t o g o i n n e x t d o o r , T em pl e S t r e e t Sorry, a nd t h e c h i l d , a n d we a r r a n g e d f o r t h e c h i l d t o b e t a k e n 23 26 g irl So I w e n t i n t o h i s incident Traynor used to "Come i n a n d we home a s h o r t t i m e and h e b r o u g h t me i n t o the study 1 a nd we d e c i d e d t o 2 because 3 M ana ge r o f G u i n n e s s 4 18 Q. 5 6 Did you a t t h a t It talking I ha d o r i g i n a l l y fin an cial A. start a b o u t m on e y m a t t e r s , known t h a t he was t h e & Mahon. s t a g e w i s h t o make some s o r t o f a r r a n g e m e n t a b o u t y o u r own a f f a i r s ? kind o f d ev elo p ed in t o that, insofar as t h a t 7 knew h e was i n v o l v e d a s a Ma na ge r o f G u i n n e s s 8 Mahon and I a l s o 9 one e v e n i n g , was i n f o r m e d , on a t o t a l l y 10 merchant banks pay b e t t e r 11 banks. 12 19 Q. 13 14 A. Yes, 16 there 17 Guinness 18 higher i n t e r e s t . 19 o v e r t o Des T r a y n o r . 21 A. 23 21 Q. 24 A. 25 22 Q. thing, that than ordinary since 1955, & Mahon, get th is still am. I have been He m e n t i o n e d t h a t b e i n g a m ercha nt bank, So I s t a r t e d t o p a s s c l e a r now. in Guinness t h e y have some mone y Did he s u g g e s t y ou o p e n & Mahon? Yes. In t h e bank i t s e l f ? Yes. So y o u o p e n e d w h a t , a deposit account in Guinness Mahon? 26 27 A. 28 23 Q. in w h i c h was t h e I r e l a n d on O ' C o n n e l l S t r e e t . an a c c o u n t 22 29 L et's at a dinner you were i n t e r e s t e d we d i s c u s s e d who my b a n k w a s , Bank o f 20 Q. in terest & of? 15 20 different So y o u m e n t i o n e d t o hi m t h a t some s o r t as w e l l , I Yes. You w e n t i n t o Guinness & Mahon, d id you, a nd s i g n & 1 2 24 Q 3 A 4 He d i d i t in h is account? study next door. He was my n e x t door neighbour. 5 25 Q 6 A 7 26 Q 8 A 9 10 How d i d y ou o p e n t h i s Yes, I understand th a t. We a r e "132", h e was " 1 3 4 " . I understand t h a t. What h a p p e n e d i n h i s I u s e d t o g i v e hi m - - it study? w o u l d b e m o s t l y c h e q u e s and some c a s h . 27 Q Just to get 11 for the 12 money? 13 A 14 28 Q 15 A That's th is first clear. tim e, When y o u o p e n e d t h e a c c o u n t what h a p p e n e d , y o u h a n d e d hi m righ t. But you d i d n ' t s i g n any documents? I h o n e s t ly cannot r e m em b er . Maybe I d i d now, 16 n o t r e m em b e r. 17 Mountjoy Square, 18 At t h a t t i m e we d i d n ' t d e a l w i t h much c a s h . 19 everything that 20 thing 21 banked, 22 o t h e r was g i v e n t o 23 our a c c o u n t a n t s u s e d t o 24 terrib le 25 o f money? 26 am s p e n d i n g i t . " 27 th is 28 m on e y . . . " 29 Doctor, "fees A ll I w ill it say i s I do t h a t working in was a w o r k i n g c l a s s I g a v e Des T r a y n o r , it e a r n e d " and " n o t b a n k e d " . practice. So, was i n t h e What was n o t some o f t h a t was a r o u n d t h e h o u s e and t h e Des T r a y n o r . drawings? In p o i n t s a y t o me, th is fact, "You h a v e You h a v e drawn e n o r m o u s a m o u n t s What a r e y o u d o i n g w i t h i t ? " t o me, of I said, More t h a n o n c e t h e y u s e d t o say "You h a v e drawn an e n o r m o u s amount o f (INTERJECTION). is not r e a l l y 10 c l e a r t o me y e t . You "I 1 2 A. 3 30 Q. That i s right. D i d he t e l l you t h i s a c c o u n t was i n G u i n n e s s 4 Bank o r i t 5 u n d e r s t a n d i n g o f w h e r e y o u r m on e y wa s? was s o m e w h e r e e l s e ? 6 A. Guinness & Mahon. 7 31 Q. Guinness & Mahon i n D u b l i n ? 8 A. 9 32 Q. 10 11 Did you r e c e i v e I did, 13 just 15 A. 16 34 Q. 17 A. 19 35 Q. 20 A. T h e r e was on t h e t o p o f t h e m a n d t h e r e w e r e How d i d t h e y a r r i v e t o y o u ? He u s e d t o d r o p t h e m i n t o the letter box. D i d y o u e v e r a s k him why t h e name o f G u i n n e s s No, & I never did. Why was t h a t ? I s was t h e f a c t h e was my n e x t d o o r n e i g h b o u r , friend. 22 some i n t e r e s t 36 Q. 24 Yes. You d o n ' t sort o f a r g u e when y o u c o u l d s e e Did he e x p l a i n t o you t h a t higher rate my c o m i n g u p. of in terest 25 A. Than o r d i n a r y b a n k s . 26 37 Q. Than o r d i n a r y b a n k s ? 27 A. 29 strip s. amounts. 21 28 & Mahon Mahon was n o t w r i t t e n on t h e s e ? 18 23 from G u in n e ss but t h e r e were a lw a y s nothing w r itte n 33 Q. statem ents that? 12 14 What was y o u r Yes. after A. & Mahon you w ould g e t a w ith Guinness & Mahon? Yes. MR. LEGGETT: Sorry, Ms. M ac k ey , if I 1 thing, 2 d o c u m e n t a t i o n h e r e t h a t h a s o n l y r e c e n t l y b e c o me 3 available, 4 or a t l e a s t 5 Mr. 6 MR. MACKEY: it may b e o f a s s i s t a n c e . in c l u d e d w ith which are t h e some o f t h e s t a t e m e n t s Traynor t o Dr. s u p p l i e d by Do y o u h a v e c o p i e s A. Yes. MR. A. JUSTICE COSTELLO: Yes, certain ly. If I f you c o u l d hand them i n . I could j u s t clarify. 11 three 12 id en tified 13 Dr. 14 hi m b y Des T r a y n o r . 15 those, 16 the bottom. 17 a s u p e r im p o s it io n o f a compliment s l i p . 18 a c t u a l l y a name a p p e a r i n g on t h e 19 I have a n o th er s e t 20 was a b l e t o 21 over the r e s p o n s i b i l i t y 22 an i n t e r v i e w we ha d w i t h t h e 23 M oriarty Tribunal, 24 L astly, 25 which vouch t h e usage t h e u sa g e o f 26 m o ne y , 27 referenced, 28 m aintained over the years, 29 of those? 9 10 statem ents, K illeen. 7 8 I h a v e some d ifferen t types them. K illeen One a r e t h e is You w i l l a reference copy sta te m e n ts see, is that as p r o v id e d to a s you go t h r o u g h to Guinness I am a f r a i d t h a t & Mahon a t m isleading. It It is is not statem ent i t s e l f . o f s t a t e m e n t s w h i c h Dr. K illeen s o u r c e t h r o u g h P a d r a i g C o l l e r y who t o o k for h is account, legal follow ing team f o r t h e and I h a v e h a n d e d t h o s e I have c o p i e s but o f d o c u m e n t s h e r e a nd I h a v e has been a b le t o u n e a rth , there I have I have to in. o f ex p en d itu re docum entation say i t on a i r c r a f t some o f t h a t has not been c r o s s w h i c h Dr. planes. K i l l e e n has 1 you r e c e i v e d t h e s e 2 statem ents 3 Yes . 4 39 Q 5 A from t im e t o t im e How o f t e n w o u l d y o u r e c e i v e f r om Mr. Traynor? these? Probably e v e r y t h r e e months. Maybe i t 6 months. slip s, 7 t o p o f them. 8 40 Q 9 A 10 41 Q 11 But t h e y showed i n t e r e s t A 13 42 Q 14 A 15 43 Q 16 A 17 44 Q t h a t was a c c r u e d ? From t i m e t o t i m e t h e n y o u p a s s e d a c h e q u e o r c a s h Traynor? That i s right. He l o o k e d a f t e r That i s it f o r y o u? right. And t h a t w o u l d b e r e f l e c t e d I t would, Now, on t h e s e a t what s t a g e d i d y o u b e c o m e a w a r e t h a t mone y was n o t i n G u i n n e s s 19 o r d i d y ou b e c o m e a w a re o f t h a t ? A t im e where t h e 22 accountant 23 ask q u e s tio n s 45 Q 25 A 26 46 Q 28 A 29 i n t h e p a p e r one f a m o us Gay B y r n e h a d m one y w i t h an and h e d i d away w i t h i t a nd I b e g a n t o a fter that. Now we a r e g o i n g b a c k now t o t h e 1 9 8 0 's? That p r o b a b l y would be som etim e to w a r d s t h e end o f 1988/89, 27 & Mahon b u t was s o m e w h e r e e l s e , I reme mbe r t h e r e was an a r t i c l e 21 24 statem ents? yes. 18 20 n o t h i n g on t h e That' s r i g h t . t o Mr. 12 But t h e y w e r e a l w a y s m ig h t run s i x around t h a t tim e . You a s k e d q u e s t i o n s I a s k e d Mr. money?" Traynor. o f whom? I said, "Where i s all th is 1 47 Q 2 A He s a i d , "It is i n t h e Cayman. " Now, th is 3 me. 4 a nd I s p o k e t o t h i s 5 He s a i d t o me, 6 b a c k t o me a f t e r 7 no m on e y i n t h e Cayman I s l a n d s . " 8 Then I s a i d t o 9 another s i x or e ig h t or t e n months a f t e r 10 said, where i s a ll 11 I had o c c a s i o n t o g e t a cheque f o r 12 my a i r c r a f t 13 "Your mone y i s 14 48 Q 15 A We h a v e a b a n k e r f r i e n d who l i v e s " De s , Des - - and i t Yes. T ha t i s all know, 19 heard o f Ansbacher. T h i s b o t h e r e d me. th is that. damn mo ne y? " I Because some r e p a i r s cheque. to He s a i d , to you t h e n , s a y t h a t he was r e t i r i n g t h e mo ne y, was an a c c o u n t . T h a t was i n 19 ... u n til as Chairman, and A n s b a c h e r , That i s the I got a first or w h i c h I now I ever ? T h a t w o u l d b e a b o u t t wo t o t h r e e y e a r s b e f o r e he d ied . 23 50 Q 24 A 25 So a b o u t 1 9 9 1 ? Yes, about t h a t , 1991, 1992. He a l s o i n f o r m e d me a t t h a t t i m e t h a t h e c o u l d t a k e no more m on e y f r o m me. 26 51 Q 27 A 28 52 Q 29 "You h a v e w ould be p r o b a b l y about I can t e l l 18 22 He came He t o l d y o u y o u r m o ne y was i n E n g l a n d ? looking a fte r A you." in England." 17 21 th is was a S t e r l i n g letter 49 Q come b a c k t o situ ation . t wo m o n t h s a nd he s a i d , 16 20 i n America gentlem en about th e "I w i l l bothered T h a t h e c o u l d t a k e no mo re money? No more m o n e y . What d i d y o u do u po n r e c e i p t steps d i d you t a k e ? of that letter? What 1 A. Nothing r e a l l y . When I h e a r d t h a t t h e m on e y was i n 2 England, 3 asked fo r a cheque to g e t 4 were l a r g e 5 a nd a c h e q u e w o u l d be o r g a n i s e d f o r me, 6 S terlin g . 7 53 Q. 8 A. 9 54 Q. 10 A. 12 55 Q. 13 A. sums, Anyway, the rep airs He s t i l l Yes, g a v e y o u a n y m on e y t h a t at that tim e. When y o u s a y " a t t h a t t i m e " , That would have b e e n a f t e r after b e i n g t a k e n o v e r a n d t h a t was i t , 17 w ith Ansbacher, 18 Des n e x t d o o r . 20 payments out 21 t i m e o f Mr. 57 Q. 24 A. 26 58 Q. 27 A. 29 it whoever i t lik e when t h i s A n s b a c h e r t h i n g was was, but I never d e a lt I always t h a t d i d you c o n t i n u e t o from A n sbacher? Did i t spoke to receive g o on up t o t h e T raynor's death? d i d and a f t e r Up t o t h e t i m e o f h i s to provide 25 28 Oh, retirem ent? w h i c h I t h o u g h t was a man, He t o l d me t h a t How l o n g a f t e r his I became aware, 16 23 w ith the fund? a ctu ally. A. they you r e q u i r e d o u t o f 15 22 if I a s k e d Des. he s a i d A n s b a c h e r , 56 Q. done, I I g a v e h im t wo t o t h r e e d a y s n o t i c e 14 19 any t im e Who w o u l d y o u a s k o n c e h e h a d r e t i r e d ? the 11 I w asn't too perturbed. as w e l l . d e a t h he c o n t i n u e d t o be a b l e it? Yes. E v en t h o u g h h e ha d r e t i r e d ? I u sed to g e t w hatever cheque I needed. 1 60 Q. D i d h e make c l e a r t o y o u i n h i s 2 he was r e t i r i n g 3 dr aw money? 4 A. No, h e made i t letter saying th at t h a t he w o u l d b e a b l e t o continue to c l e a r t h a t h e was r e t i r i n g from t h e 5 b u s i n e s s h e r a n a nd I u n d e r s t o o d r e a l l y t h a t h e h ad 6 packed in 7 understood. 8 t o d e a l w i t h hi m i f 9 p ractically 10 in Guinness But, all & Mahon. That i s up t o t h e t i m e o f h i s what I death I used I needed a cheque f o r - ­ t h a t mone y w e n t on l o o k i n g a f t e r our a ircraft. 11 61 Q. 12 A. 13 62 Q. 14 A. 15 63 Q. 16 A. 17 B u t y o u c o u l d n o t l o d g e a n ym o r e money? No. A fter his death, w ha t h a p p e n e d t h e n ? Then I was i n t r o d u c e d t o Who i n t r o d u c e d y o u t o Mr. Padraig C o lle r y - - w ell, Padraig C o lle r y . C ollery? I know P a d r a i g C o l l e r y c a l l e d t o my home. 18 64 Q. 19 A. 20 65 Q. 21 A. 22 When was t h a t ? As f a r a s Sorry, I r e m e mb e r , when d i d t h i s a nd h e s a i d . . . (INTERJECTION). happen? T his would be about two, three, four days a f t e r Des d ied . 23 66 Q. 24 A. 25 67 Q. 26 A. He c a l l e d to your house? To y o u r home, yes. Had y o u e v e r me t hi m a t t h a t I am n e a r l y s u r e . stage? D i d I m e e t hi m i n T r a y n o r s ? I 27 c a n n o t reme mbe r now, but 28 introduced h im se lf. I a l s o me t a n o t h e r man c a l l e d 29 J o h n F u r z e i n T r a y n o r s a b o u t t wo t o t h r e e d a y s a f t e r I know t h a t t h i s man 1 2 68 Q I n Mr. T raynor's house? 3 A I n Mr. T raynor's house. I h a v e an i d e a t h a t maybe I 4 m et P a d r a i g C o l l e r y t h e r e , 5 me t h a t 6 d e a lin g with t h i s 7 69 Q 8 A 9 but i t P a d r a i g C o l l e r y was t h e man t h a t w o u l d b e Then h e c a l l e d after that. to your house? I t h i n k he c a l l e d t o my h o u s e , t h i n g s b e g a n t o go on a nd a l l 10 came t o t h e 11 "L isten, 12 a nd how much m on e y do I h a v e ? " 13 70 Q 14 15 A 16 71 Q fore, as w e l l , th is I s p o k e t o Mr. I w a nt t o B e f o r e we g e t just was i n t i m a t e d t o fin a lise all on t o t h a t p o i n t , a f t e r Mr. too. thing When kind o f C o l l e r y a nd s a i d , th is sort of thing c a n we g o b a c k t o T raynor's death? Yes . P a d r a ig C o l l e r y i n t i m a t e d t o you, w h e t h e r h e came t o 17 y o u o r y ou me t h i m i n Mr. 18 i n t i m a t e d t o y o u t h a t h e was now t h e p e r s o n d e a l i n g 19 with it ? 20 A 21 72 Q 22 A That i s right, 23 If 24 i t . f o r sometime a fte r w a r d s? T h e r e was a n o t h e r man i n v o l v e d , I needed a cheque, 25 73 Q 26 A 27 74 Q Sam F i e l d - C o r b e t t ? 28 A Sam F i e l d - C o r b e t t . 29 75 Q Who was h e ? A man c a l l e d he yes. D i d y o u d e a l w i t h hi m t h e n Yes. T raynor's house, Corbett. I was a s k e d t o as w e l l , too. c o n t a c t hi m f o r 1 I h a v e an i d e a t h a t 2 else 3 that, 4 76 Q 5 6 A P a d r a i g C o l l e r y t o l d me. C o r b e t t r a n g me o r I am a b i t hazy about actu ally. Did you, Mr. e i t h e r Mr. in fact, d e a l w i t h Mr. C o rb ett as w e l l as C ollery? I did, yes. If I needed a cheque, 7 or th e o t h e r o f them. 8 Mr. 9 c o m m u n i c a t i o n s w i t h hi m maybe t w i c e , F ield-C orbett I eith er rang one As f a r a s I r e m e mb e r , th at used to -- it was I o n l y ha d or t h r e e tim e s 10 at the very, 11 c h e q u e d e l i v e r e d t o me o r I w o u l d p i c k up a c h e q u e . 12 77 Q 13 14 v ery most. Where w o u l d y o u p i c k up t h a t A I think i t was i n a b l o c k o f - - apartment b lo c k , 16 Tavern S t r e e t . 78 Q 18 A 20 79 Q 21 A 23 24 you wanted Would i t b e Mr. it was l i k e an a s m a l l a p a r t m e n t b l o c k i n Wine F ield-C orbett's o ffic e i n Wine Tavern S t r e e t ? 19 22 cheque i f it? 15 17 He w o u l d a r r a n g e t o h a v e a Yes . When w o u l d y o u r e c e i v e 25 would i t a lw a y s be a cheque or w ould you a t t i m e s receive It never cash, was a l w a y s a cheque, always a S t e r l i n g 80 Q it, A f t e r Mr. yes, it in cash? no. I t was cheque. T r a y n o r ' s d e a t h were you a b l e t o lodge a ny mo r e money? 26 A 27 81 Q No. A ll the 28 death? 29 Yes. lodgem ents stopped th ree years b efo re h is The l o d g e m e n t o f m on e y s t o p p e d t w o t o t h r e e 18 1 2 82 Q 3 4 Can I a s k y o u , would lo d g e , A 5 83 Q 7 A Was i t Oh, yes, and i t yes. 9 fees was i n t h e T r a y n o r came o u t o f section "not l o d g e d " . As I t o l d y o u , set earned, up t h i s not when Mr. Traynor t h e r e were t h r e e l o d g e d a nd l o d g e d , columns, and a l l that m on e y was d e c l a r e d i n c o m e . 11 84 Q 12 A Very good. As I m e n t i o n e d t o y o u , 13 saying, 14 t a k i n g out?" 85 Q 16 17 d e c l a r e d income? d e c l a r e d incom e? origin ally 10 t o t h e m on e y t h a t y ou The mone y t h a t was g i v e n t o Mr. 8 15 was t h i s the p r a c t ic e 6 in r e la t io n A my a c c o u n t a n t s w e r e a l w a y s "What a r e y o u d o i n g w i t h t h e m one y yo u a r e In r e l a t i o n then to the i n t e r e s t d ep osit, was t h a t No, O rigin ally, no. that a c c r u e d on t h e declared? I always th a t in a merchant 18 bank, 19 situation 20 o u t when Mr. T r a y n o r t o l d me t h a t t h e m on e y was i n 21 t h e Cayman. At t h a t 22 r e a l l y w asn't 23 accountants 24 86 Q 25 A 26 27 that You d i d n ' t No, & Mahon d e a l t w i t h t h e as regards ta x . stage strictly I came t o legal, tell I found know t h a t but I d id n 't th is tell my your a cco u n ta n ts? know w ha t t o do w i t h i t , really, so I k e e p my mont h s h u t . Who w e r e y o u r a c c o u n t a n t s 28 was no l o n g e r Mr. 29 No, it U nfortunately, in terest about i t . I d id n 't decided to 87 Q Guinness during a l l th is time? It Traynor? was H a u g h e y B o l a n d o r i g i n a l l y 19 and t h e n t h e y 1 m e r g e d w i t h Howard a nd s o m e t h i n g , 2 a n o t h e r m e r g i n g and t h e y a r e now D e l o i t t e 3 88 Q 4 5 At t h e t i m e y o u h ad t h i s Mr. A a n d t h e n t h e r e was arrangement w ith T r a y n o r who was y o u r a c c o u n t a n t ? W ell, it was D e l o i t t e & Touche, w ell, 6 but I never m entioned - - the 7 m entioned t h i s I a s k e d Mr. 8 fin alise 9 I lodged th at was a f t e r and t h e n 11 had t h i s a n d, 12 me . 14 Mr. 15 was a d e p o s i t A 17 90 Q ... 18 A No. 19 91 Q 20 A I ever C o llery to I inform ed th e a c c o u n ta n ts of course, When y o u e n t e r e d i n t o 16 tim e etc, i n K i l l e s t e r b r a n c h o f t h e Bank o f Ireland, 89 Q first H o w ar d s, t h e a r r a n g e m e n t s a nd h e g a v e me a c h e q u e . 10 13 & Touche. Traynor, thinking, I t h e y n e a r l y went th rou gh the o r ig in a l relation sh ip you have t o l d u s , in Guinness that that with that & Mahon . . . (INTERJECTION). Yes . d id your a cco u n ta n ts You d i d n ' t No. tell know a b o u t i t then? your a cco u n ta n ts? The m o ne y ha d b e e n d e c l a r e d f o r t a x p u r p o s e s . 21 When I t o o k t h e m one y o u t i t 22 really, 23 told, 24 cash in i l l o 25 e v e r y t h i n g was E a s t e r n H e a l t h B o a r d a n d i t 26 cheques th a t 27 had t o d e c l a r e 28 These would be th e n your f e e s 29 lodged? was my b u s i n e s s , b e c a u s e my t a x h a d b e e n p a i d on i t . we w e r e a w o r k i n g c l a s s tempore, came i n . practice, and t h e n So i t As I very l i t t l e f r om 1 9 7 2 o n w a r d s was a l l had t o be d e c l a r e d , it. t h a t were b e in g we 1 2 93 Q 3 A 4 94 Q 5 6 Yes . Was t h e r e a n y o t h e r m o n i e s o t h e r t h a n y o u r f e e s went i n t o A W ell, th is account? t h e r e were a l l classes of fees. 7 an e x a m i n a t i o n w i t h t h e G a r d a i , 8 cheque 9 95 Q 10 A 12 96 Q 13 t h e y w o u l d s e n d me a ...(INTERJECTION). T he y w e r e a l l fees, but apart We w o u l d h a v e m e d i c o - l e g a l A part from m e d i c a l going in to f r om t h e A No, no, 16 th o se days, 97 Q 18 A 19 98 Q 20 were t h e r e a l l m e d i c a l work m e d i c a l l y . some c a s h i n , 17 fees, fees. any o t h e r funds it. 15 as w e l l . lik e There would be F e e s were v e r y s m a l l i n a p o un d o r t wo o r t h r e e . Some o f y o u r f e e s would be i n cash? Yes . Can I a s k y o u w h e t h e r y o u a v a i l e d o f t h e 1993 t a x amnesty? 21 A 22 99 Q 23 A 24 1 00 Q 25 26 We w o u l d do . . . (INTERJECTION). 11 14 that No, I d id n 't. You d i d n o t ? I should have, but I d id n 't. D i d y o u e v e r d i s c u s s w i t h Mr. Traynor th e settin g o f a Trust? A 27 No, a nd i t was n e v e r d i s c u s s e d w i t h me e i t h e r , suggested. 28 1 01 Q 29 A You d i d n o t do s u c h a t h i n g ? or up 1 102 Q 2 A 3 4 E v e n t h o u g h we l i v e d n e x t d o o r , often. 1 03 Q 5 Yes, I understand. A 7 104 Q 8 A 9 No, W ell, I do, a nd y o u a r e r i g h t . i n c o r r e c t now. 11 wo r d , 12 years before 1 05 Q 14 O rigin ally, A 16 106 Q 17 A 18 107 Q That i s strictly first I heard about th e t h e name " A n s b a c h e r " was a b o u t t w o t o t h r e e L e t me p u t i t I do now, Des d i e d . a n o t h e r way. but I did not Do y o u a c c e p t t h a t you account? know t h e n . B u t y o u knew t h r e e y e a r s b e f o r e h e d i e d ? I knew t h r e e y e a r s b e f o r e h e d i e d t h a t t h e r e was d efin itely 20 ...(INTERJECTION). You knew y o u r m on e y was n o t , at that stage, in Ireland? A No, I always - - as I t o l d you, when I me t t h i s 22 A m e r i c a n b a n k e r a nd he i n f o r m e d me t h a t 23 m on e y i n t h e Cayman - - 24 know. 25 i n f o r m e d me t h a t 26 Islan d s. 108 Q A I h a d no how h e knew t h a t , I suppose in the banking b u s i n e s s . stage I don't But, I h a d no m one y i n t h e Cayman I t h i n k y o u t o l d u s t h a t Mr. that 28 29 that I always th ought th a t & Mahon and t h e h a d mone y i n an o f f - s h o r e 15 27 K illeen , You d o n ' t ? was G u i n n e s s 21 Dr. I don't. 10 19 Do y o u a c c e p t , y o u h a d an A n s b a c h e r d e p o s i t ? 6 13 we d i d n o t m e e t t h a t ...(INTERJECTION). Traynor t o l d you a t he 1 109 Q 2 A That's righ t. T he n, after the a r t i c l e on Gay B y r n e 3 a nd h i s 4 But, 5 f r i e n d i n t h e US a n d h e t o l d me t h a t we h a d no mone y 6 i n t h e Cayman I s l a n d s . 7 said, 8 1 10 Q 9 10 accountant, before I a s k e d hi m I h a d s p o k e n t o t h i s "Your mone y i s 11 Oh, yes, in England." 1 11 Q 13 A fact, in account? I accept t h a t now, but I d id n 't That i s Yes, the account that but then I also is know t h a t now known a s A n s b a c h e r ? have to correlate 14 American f r i e n d 15 m on e y i n t h e Cayman I s l a n d s . " 16 i n t h e Cayman I s l a n d s , 17 they d id n 't 112 Q 19 Yes. But, s a i d t o me. have i t anyway, ipso He s a i d , S o, facto, w h a t my "You h a v e no if I h a d no mone y anybody e l s e , i n t h e Cayman I s l a n d s eith er. y o u now a c c e p t t h a t t h a t is the case? 20 A 21 1 13 Q Oh, yes. I would j u s t lik e 22 you, 23 might i d e n t i f y 24 A 25 114 Q Yes, just to put a couple for the record, Dr. them or g i v e o f documents to K illeen , t h a t you y o u r v i e w s u po n t he m? certain ly. The f i r s t one I would l i k e to put to 26 drawn on I r i s h 27 of £16,000, p a y a b l e t o C . M. T. 28 Dr. E xhibit 29 in at th a t tim e. 12 18 banker When I a s k e d Des t h e n he Do y o u now a c c e p t t h a t y o u r m o ne y w a s , an o f f - s h o r e A I s t a r t e d to ask q u e s t io n s . K illeen you i s I n t e r c o n t i n e n t a l Ba nk, 1? K illeen . a cheque to the value Is that you, 1 1 15 Q 2 A That i s my s o n . 3 116 Q That i s your son? 4 A 5 117 Q Yes . W ell, just 6 pass 7 handed) 8 A 9 118 Q 10 h o ld in g onto th a t you a l e t t e r E xhibit A 12 119 Q 13 A 14 1 20 Q 15 A 17 1 21 Q d a t e d 2 8 t h F e b ru ar y 1991 (same 11. From J o a n W i l l i a m s . D i d y o u e v e r m e e t Ms. W i l l i a m s , T raynor's secretary, Dr. K illeen? Yes . You d i d m e e t h e r I did, This, yes. as you can s e e , to the 16 can I Thank y o u . who was Mr. 11 f o r a moment, Irish is a letter Intercontinental from h e r a d d r e s s e d Bank? R ight. A s k in g t h e bank t o arrange to let her have fo r 18 collection 19 t o C. M. T. 20 be d e b i t e d t o t h e A n sb a c h e r L i m i t e d c a l l 21 0201087/81. 22 . . . (INTERJECTION). 23 A 24 Yes, the an I r i s h p o u n d d r a f t K illeen , and t h a t for £16,000, the S te r lin g payable c o s t was t o account T h a t was t h e A n s b a c h e r a c c o u n t c h e q u e was i n a d v e r t e n t l y made o u t t o my son. 25 122 Q 26 A But i t Yes, sh ou ld have been fo r , a nd I know w h a t t h a t was i t ? cheque was. That cheque 27 was f o r an e n g i n e 28 o v e r h a u l t h a t was on an a i r c r a f t that 29 th a t tim e. in correct, -- w ell, That c h eq u e , n o t a r e p l a c e m e n t b u t an that is I bought at it 1 s h o u l d n o t h a v e b e e n made o u t t o C . M. T. 2 s h o u l d h a v e b e e n made o u t t o T . C . 3 1 23 Q So t h i s is 4 A That i s right, and w i t h d r a w a l yes, but 6 tim e . 8 A 9 But you r e c o g n i s e Oh, yes, C . M. T. 10 but as that I think, 1 25 Q 12 A Yes . 13 126 Q Now, can I p a s s 1992 (same h a n d e d ) 14 15 A 16 127 Q is pay t o th e incorrect, you a n o t h e r l e t t e r E xhibit that order of sh o u ld have Again, it is a letter 18 c h e q u e p a y a b l e t o C. 19 A 20 128 Q 21 A 22 129 Q 23 A 3? the That i s IIB, from Joan W i l l i a m s to have a v a i l a b l e K illeen right. Do y o u r e c o g n i s e th a t as another w ithdrawal? That i s yes. correct, Very good. B u t I do n o t recognise, I n e v e r knew a n y b o d y named 25 Intercontinental As we now know, cer ta in point A a for £4,600? Ronan Redmond a n d I n e v e r h e a r d o f 27 asking the for c o lle c t io n 24 1 30 Q d a t e d 1 0 t h J u ne Thank y o u . bank, 29 at that That s h o u l d h a v e b e e n you? 17 28 or I b e e n me. 11 26 letter the withdrawal? I s a i d t o you, K illeen , K illeen . I n e v e r saw t h i s never heard o f Ansbacher L im ited, 124 Q it from your a c c o u n t ? 5 7 K illeen , Bank. t h e A n s b a c h e r a c c o u n t was move d a t a from G u in n es s I n e v e r knew t h a t , S terlin g . Irish & Mahon t o b u t I know t h a t IIB? I got £4,600 1 1 31 Q Very good. F inally, 2 d a te d 8th June, 3 E xhibit 4 A 5 132 Q 5, E xhibit If you would l o o k f i r s t 7 Ronan Redmond a t t h e 9 1 33 Q a nd 1 1 t h J u n e 1992, Yes . a g a i n you s e e A 4, resp ectively? 6 8 can I p a s s you two l e t t e r s it is at that a letter IIB, of 8th June, f r om J o a n W i l l i a m s t o asking . . . (INTERJECTION). That i s 1992. Yes, it is 10 one, I should th in k . 11 you, a nd t h e n e x t 12 w h a t p o s s i b l y h a p p e n e d was t h a t t h a t £ 4 6 was 13 i n a d v e r t e n t l y m entioned in s t e a d o f £ 4 ,6 0 0 , 14 got in 15 stage 16 A 17 134 Q 18 A 19 1 35 Q 20 A 21 136 Q 22 A 23 137 Q 24 A 26 138 Q fact a cou p le o f days b e fo r e th e e a r l i e r A s k in g t o have £46 p a y a b l e t o letter cancels th a t. t wo d a y s l a t e r . asking f o r £46 You h a v e n e v e r Now, I think w h i c h y ou Do y o u r e c o l l e c t a t any ...(INTERJECTION)? I have n ev er seen t h e s e letters before. seen those? No. The d a t e Yes, I think i t is June. I t must have b e e n £ 4 , 6 0 0 . was m i s t a k e ? B e c a u s e t h a t was a g a i n p a i d f o r m a i n t e n a n c e . F in ally, can I p a s s yo u . . . (INTERJECTION). Can I k e e p t h e s e ? Th e y w i l l b e p a r t o f t h e t r a n s c r i p t w h i c h y ou w i l l get 25 just and a copy o f , if you so w ish ? Do I n e e d t o g i v e Yes. F in ally, 27 cheque? 28 quite 29 you w i l l This th e s e back. can I p a s s you a co p y o f a n o t h e r is a cheque £ 2 8 ,7 5 0 p a y a b le a bad co p y , see it is but I th in k i f payable to Dr. -- it is you c a r e f u l l y a t Ita K illeen, it 1 2 3 139 Q 4 A 5 1 40 Q It is 1 9 t h No ve mb e r 1 9 8 6 ? Yes . You r e c o g n i s e that cheque or does i t y o u r memory? 6 7 A 8 1 41 Q 9 A 10 142 Q 11 A The d a t e j o g s my memory. D oe s t h e a m o un t ? Yes i t is, It is quite a nd I know w ha t i t a large cheque. is as w e l l , for, We b o u g h t an a p a r t m e n t i n P o r t u g a l a t t h a t t i m e , we d i d p a s s it 13 two p e o p l e , t h e Bank o f P o r t u g a l t o 14 t h e C e n t r a l Bank t o e x p o r t m o ne y . 1 43 Q 16 17 Did you g i v e through th e that c h e q u e t o Mr. A cheque, Traynor t o -- I got approval i m p o r t mone y and or your w if e give that lodge? I t h in k t h a t would have been s e n t on p r o b a b l y t o t h e estate 19 never r e a lis e d 20 I know w ha t t h a t 21 b o u g h t an a p a r t m e n t a t t h a t 22 we d i d g e t a p p r o v a l 23 i m p o r t mone y a n d we d i d g e t 24 C e n t r a l Bank. 25 I understand th a t. We a r e n o t r e a l l y 26 that What I am r e a l l y t r y i n g t o 27 out here i s 28 Mr. agency in Portugal, aspect as fa r as I r e m e mb e r . t h a t h e r name was on t h e is of i t . for, that is tim e. what i t But, f r o m t h e Bank o f whether t h i s Traynor a t any s t a g e ? but f r om 18 29 too. What? 12 15 jog anything in approval cheque, is, as I but we I said, Portugal to from t h e concerned with find c h e q u e was h a n d e d b y y o u t o 1 1 45 Q 2 A I don't think I ever - - t h a t would have been a 3 c h e q u e t h a t we h a d t a k e n o n w a r d s , 4 have g iv e n i t t o Mr. 5 g a v e hi m t h a t t y p e o f an amount e v e r . 6 MS. MACKEY: Traynor. b u t I w ould n o t I don't think Very good. 7 We m i g h t maybe take a break here 8 coffee 9 h a v e a c up o f c o f f e e . 10 and y o u a n d y o u r s o l i c i t o r ten m inutes We w i l l and c o n t i n u e o n . I ever for a r e welcome t o come b a c k i n a b o u t Thank y o u v e r y much. 11 12 (SHORT ADJOURNMENT) 13 14 A 15 I can c l a r i f y th is c h e q u e f o r y o u now, know e x a c t l y w h a t i t 16 146 Q 17 A E xhibit 7, I is. Okay. This cheque p e r t a i n s t o an a p a r t m e n t t h a t was 18 purchased in P ortugal. 19 was q u i t e 20 a nd we ha d t o p r o d u c e t h e m o ne y r a p i d l y a nd b o r r o w e d 21 t h e mone y f r o m an I r i s h man who h a d a home down 22 there 23 f o r hi m . 24 147 Q 25 A It When we w e r e t h e r e , a h i g h demand f o r t h i s and h e l o a n e d me t h e m o n e y . particular there complex T h a t was p a y - b a c k was p a y - b a c k f o r him? Yes. This is i n my w i f e ' s name, 26 o n e who was p u s h i n g f o r t h i s 27 I do n o t t h i n k 28 was an i n t e r - b a n k - - 29 Okay. Thank y o u? s h e was t h e apartment at t h a t s h e e v e r s aw t h a t it because cheque. tim e. I think i t d e f in it e ly p ertains to us. 1 A. And i t is d efin itely 2 Montechoro. 3 MS. MACKEY: on a p a r t m e n t 304E V i l l a Magna, Very good, that is fin e. Thank y o u v e r y much. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF EXAMINATION OF DR. KILLEEN BY MS. MACKEY 1 2 3 MR. ROWAN: Dr. 4 K illeen, m entioned, you in connection 5 w ith the purchase o f the apartment, 6 s o u g h t and o b t a i n e d C e n t r a l Bank c l e a r a n c e 7 . . . (INTERJECTION). 8 A 9 1 50 Q 10 11 That i s that y o u h ad righ t. Presumably f o r p a y in g out o f th e c o u n tr y . How d i d you go a b o u t t h a t ? You s e e , t h e r e w e r e t wo a p a r t m e n t s h e r e . 12 origin al o n e was o n l y a s t u d i o 13 2 0 1 A V i l l a Magna, 14 c o u l d n o t t a k e m on e y i n o r o u t w i t h o u t g e t t i n g 15 thing. 16 t h e C e n t r a l Bank a nd I know I w r o t e t o t h e Bank o f 17 P o r t u g a l a nd t h e y a c k n o w l e d g e d , 18 acknowledged th a t 19 A 1 51 Q a p a r t m e n t and i t Montechoro. I r e m e mb e r , I think, it The is I n t h o s e d a y s y ou the I p e r s o n a l ly wrote to b o t h were c o u ld be done. You w r o t e t o t h e C e n t r a l Bank a n d s a i d , "I i n t e n d t o 20 p u r c h a s e a p r o p e r t y and i t 21 much mone y a n d I am g o i n g t o n e e d t o p a y t h i s mone y 22 in respect 23 A R ight, is going to c o s t me s o of the purchase." and I p a i d a c h e q u e o u t o f my p e r s o n a l 24 account 25 around 1982, 26 own c h e q u e s t o t h e v a l u e , 27 that tim e. for the first I think. one. That w ould have bee n I reme mbe r s i g n i n g o n e o f my I think i t was £ 1 9 , 0 0 0 at 28 152 Q Yes, a nd t h e C e n t r a l Bank . . . ( I N T E R J E C T I O N ) . 29 A Yes, a nd I h a d Bank o f P o r t u g a l a p p r o v a l a n d I h ad 1 approval 2 my p e r s o n a l 3 b e fo r e th e Guinness 4 1 53 Q. 5 f o r t h e C e n t r a l B ank . cheques at th a t A. 7 154 Q. 8 A. 9 tim e, That i s & Mahon b u s i n e s s . I don't think into we a p p r o v e t h i s was a p p r o v e d , Did you r e t a i n th is that so, one, o u t one o f b e c a u s e t h a t was C e n t r a l Bank w r o t e b a c k t o y o u a nd s a i d , fo r your l e t t e r , 6 I filled "Thank y o u r tran saction ." yes. letter, because, by any chan c e ? you s e e , t h a t was i t . when we move d You s e e , when t h i s came 10 a b o u t t h e r e was no p r o b l e m a b o u t s h i f t i n g mone y i n 11 or out at t h a t 12 bought the 13 M ontechoro. 14 out, 15 1 55 Q. 17 his 19 1 5 6 Q. a p a r t m e n t i n 204A V i l l a The s i t u a t i o n Yes. When he a nd y ou a g r e e d t h a t you w ould open t h e 21 in form ally in h is 23 157 Q. 24 That i s A. 26 158 Q. 27 hi m t o That i s study in h is & Mahon i t first was d o n e home? righ t. Subsequently, in to 25 you were n ext door neighbour? d e p o s i t account w ith Guinness A. you o b v i o u s l y know Desmond T r a y n o r p r e t t y w e l l , 20 22 Magna, a b o u t t a k i n g mone y i n o r J u s t r e t u r n i n g t h e n t o t h e main i s s u e , got to A. first T h a t was s h o r t l y a f t e r we you d i d n ' t have t o a s k f o r p e r m i s s i o n . 16 18 tim e. y ou w o u l d h a v e d r o p p e d c a s h o r c h e q u e s lodge to the account? right. You a s k e d hi m f r o m t i m e t o t i m e t o w i t h d r a w mone y from t h e a c c o u n t ? 28 A. 29 1 5 9 Q. Yes, that is righ t. You g o t p e r i o d i c a l s t a t e m e n t s which d i d n o t have any 1 2 Com pletely blank, 3 t h e y were a l l 4 1 60 Q 5 A 6 1 61 Q 7 A done i n h i s T h i s was a p r e t t y Yes, Is it a nd t h e y w e r e a l l study. in form al arrangement, L o o k i n g b a c k on i t 9 He was a , I me an, let's now, of course, say, 11 o f q u e s t i o n i n g him a b o u t t h e 12 I g o t one o f t h e s e 13 g i v e n hi m came up on i t . 14 to doubt th e circles but at th a t in Dublin. slip s it w ell known I w o u l d n e v e r dr eam situ ation . Every tim e was a l w a y s w h a t I h ad T h e r e was no r e a s o n f o r me situ ation . 15 162 Q 16 A 17 1 63 Q And was b u s y , 18 A He was w h i c h ? 19 164 Q 1 65 Q no, a f i n a n c i a l wizard, in b u sin ess 22 it? t h e man was my n e x t d o o r n e i g h b o u r . 10 A w asn't t h a t w h a t y o u e x p e c t e d o f a m e r c h a n t b ank ? tim e - - 21 I understood was. 8 20 -- He was an i m p o r t a n t man i n t h e b a n k i n g c o m m u n i t y ? Oh, yes. I take it? He was b u s y . He w o u l d h a v e b e e n p r e t t y i n v o l v e d with a l l the Oh, yes. yes, resp on sib ilities h e had? D i d y o u e v e r w o n d e r why s o m e o n e who was t h a t 23 i m p o r t a n t a nd t h a t b u s y c o u l d f i n d t h e t i m e t o a c t 24 alm ost 25 A W ell, lik e a bank m e s s e n g e r ? you s e e , we l o o k e d a f t e r hi m m e d i c a l l y , I was 26 his 27 w ell 28 no r e a s o n t o d o u b t o r w o r r y a b o u t my e n d o f t h e 29 money. fam ily doctor, and h e w a s n ' t a man t h a t was v e r y a nd we l o o k e d a f t e r h im f a i r l y w e l l . So, I h ad 1 1 6 6 Q. I t was r e a l l y a q u e s t i o n around t h e idea that 2 s o m e o n e who h a d r i s e n t o q u i t e 3 respective 4 c o u ld p o s s i b l y have d e v o te d th e tim e t o 5 l o d g e m e n t s and g e t t i n g p a y m e n t s o u t ? 6 s t r a n g e phenomomen? 7 A. No, it organisations w asn't. i n w h ic h he wa s, It w asn't 8 h o n e s tly thought th a t 9 doing t h i s a high l e v e l how he accepting Was t h i s s t r a n g e t o me, f o r a nd he was o n l y d o i n g i t because 11 h a d no r e a s o n w h a t s o e v e r t o t h i n k o t h e r w i s e . 12 A b s o l u t e l y none a t a l l . next door neighbour. The e l e m e n t o f i n f o r m a l i t y 14 wo r d " s e c r e c y " , 15 "inform ality" 16 A. 17 168 Q. I I was t h e o n l y o n e t h a t h e was was h i s 167 Q. not a because 10 13 in the -- That i s the I reason I I was g o i n g t o u s e t h e b u t l e t me u s e t h e wo r d about i t . Yes. That d i d n ' t strik e a c o r d w i t h you u n t i l the issu e 18 came up o f t h e p o s s i b i l i t y o f maybe s o m e t h i n g b e i n g 19 not q u ite whenever th e 20 up a b o u t t h e r a d i o o r t e l e v i s i o n 21 money? 22 A. Yes, r ig h t with t h i s , but then as scandal came p erson ality's I h a r k e n b a c k t o w h a t my I 23 origin ally 24 U n i v e r s i t y C o l l e g e we knew e v e r y t h i n g a b o u t m e d i c i n e 25 b u t we g o t no l e c t u r i n g 26 one's 27 I t was d r e a d f u l . 28 e v e r y t h i n g was m e d i c i n e . 29 I was v e r y g r e e n a s r e g a r d s m o ne y , life sa id here, when we w e r e t u r n e d o u t o f on how o n e s h o u l d b e h a v e i n a s r e g a r d s m o ne y , finance or a n y t h in g . We w e r e n e v e r g i v e n a n y - ­ So, f r om my p o i n t o f v i e w , a nd Des was t h e 1 first 2 f o r an a c c o u n t a n c y s i t u a t i o n 3 1 6 9 Q. man who r e a l l y I was r e a l l y sta r te d to la y the foundations f o r our p r a c t i c e . divorcing a l i t t l e the accountancy need 4 for the p r a c tic e 5 account. 6 o n e w i t h t h e Bank o f I r e l a n d ...(INTERJECTION)? I h a v e b e e n w i t h t h e Bank o f Ireland sin ce 7 A. 8 1 70 Q. 9 10 A. I me an, When y o u g o t "Bank o f That i s f r om t h e right, o f h a v i n g a bank you had a bank a c c o u n t . a Bank o f Ireland" issue Ireland statem ent i t is correct. It issue 12 T r a y n o r was s u c h a h i g h p r o f i l e 13 n e x t d o o r n e i g h b o u r and we l o o k e d a f t e r 14 was no r e a s o n t o t h i n k a n y t h i n g o t h e r w i s e . 15 A b s o lu t e ly none. 16 was I n a i v e , 1 71 Q. 18 Mr. 19 A. 20 172 Q. 21 A. 23 1 73 Q. 24 as I said to you, Des b a n k e r a n d h e was my him. There When y o u come t o t h i n k o f i t , w asn't I. boy, My g o o d n e s s . w h a t was h a p p e n i n g was t h a t y o u knew T r a y n o r and h e knew y o u? Yes. He was p u t t i n g h i s confidence i n you as a m e d i c a l That's righ t. And y o u w e r e p u t t i n g y o u r c o n f i d e n c e i n hi m a s a banker? 25 A. 26 17 4 Q. 27 29 Because, p ractition er? 22 28 In e f f e c t , h ad n e v e r was an 11 17 1955. on t h e t o p o f i t ? that w i t h me. You h ad E xactly. How do y ou f e e l now a b o u t h a v i n g p u t t h a t confidence i n him? A. W ell, put i t th is s h a t t e r e d now. way, my c o n f i d e n c e i n hi m i s B o t h my w i f e a n d m y s e l f h a v e a l w a y s 1 p r a c tis e d m edicine to the proper e t h ic s 2 m edical p r o fe s s io n 3 anything, 4 was e v e r d i d a n y t h i n g w r o ng m e d i c a l l y . 5 confidence 6 MR. ROWAN: ever, and n e v e r , to people, i n Des now i s 7 ever, y o u know, shattered, Thank y o u . of the ever did question that Whereas, 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 my really. I do n o t h a v e anything fu rth er to ask. 8 9 Irish END OF EXAMINATION OF DR. KILLEEN BY MR. ROWAN I 1 2 3 4 MR. JUSTICE COSTELLO: J u st a few q u e s t i o n s , 5 Doctor. The d o c u m e n t t h a t 6 you gave us t h i s morning w ould seem t o 7 1983, 8 1 9 8 6 a nd 1 9 8 7 ? 9 A 10 176 Q and t h e d o c u m e n t s h e r e g o on up t o Can y o u re me mb e r when y o u f i r s t statem ents 12 These are A 14 15 Mr. f r o m Mr. Traynor? started getting Was i t before 1983? I cannot r e a l l y . I t w ould be about th a t tim e. 177 Q Is t h a t when i t Mr. 17 before A No, started, Traynor s t a r t e d ? no, it 20 t o him - - 21 years 23 A 25 179 Q u n til after the ea r ly 8 0 's, was i t That i s 'B elvedere' 1977, because, -- a nd t h e n i t that as I said, is n ext door was a g o o d f e w that. C o u l d we t a k e before 24 Was i t c o u l d n ' t have b een, we d i d n ' t move i n t o 178 Q your arrangement w ith 1980? 19 22 1 9 8 5 and 1983. C ostello, 16 18 in Yes . 11 13 start it that it was s o m e t i m e n o t v e r y l o n g 1983? right. These documents t h a t y ou h a v e h a n d e d i n a r e t h e b a n k 26 documents t h a t 27 . . . (INTERJECTION). 28 T h e r e was n e v e r a n y t h i n g on t h e - - 29 any c a p t i o n s , t h e r e was no name o r t i t l e Mr. C ostello, never. t h e r e were n e v e r 1 1 80 Q. 2 It shows, to th is 3 A. 4 1 81 Q. 5 however, A. 7 182 Q. 8 t h e r e was i n t e r e s t credited account? Yes. You knew t h r o u g h o u t a l l was c r e d i t e d t o 6 that these years that in terested it? Yes. It is th is in terest, y ou r e a l i s e now, th at tax sh o u ld have been paid? 9 A. 10 1 83 Q. That i s Now, right. you t o l d your a cco u n ta n ts about t h i s and t h e y 11 a p p a r e n t l y t h o u g h t you had b e e n v e r y f o o l i s h , 12 words t o t h a t 13 that 14 A. 15 A fter it 16 184 Q. 17 A. 18 1 85 Q. 19 A. 20 1 8 6 Q. 21 A. -- effect -- or and I d o n ' t want t o go i n t o b u t when was t h a t ? I got the c h e q u e f r o m Mr. i n t h e bank i n K i l l e s t e r C o l l e r y a nd I l o d g e d a b o u t 18 m o n t h s a g o . You w e n t t o y o u r a c c o u n t a n t s ? I did, and I t o l d Who was t h e them a b o u t t h a t . accountant? David R ichardson in D e l o i t t e Mr. Yes, & Touche. Richardson? a nd h e i n s i s t e d on i n f o r m i n g t h e t a x p e o p l e 22 t h a t t h i s m one y was t h e r e now a n d t a x h a d t o b e p a i d 23 for i t , 24 i n t o my p o s s e s s i o n h e i n s i s t e d 25 187 Q. A. 28 29 What a b o u t t h e arrears, on p a y i n g t a x . t a x on t h e a r r e a r s , a r e you n e g o t i a t i n g w i t h t h e Revenue? 26 27 and f r o m t h e moment t h a t t h a t m on e y came No, I haven't. That has t o be d e a l t w i t h . the next debacle th at 188 Q. That i s I have got m y s e lf i n t o . A re y o u g o i n g t o do t h i s ? 1 Oh, 2 d efin itely 3 Com m issioners, 4 Very w e l l , 5 you, 6 transcript 7 in the next 8 A 9 1 90 Q 10 A yes, Dr. R ight. If I w ill, yes. Yes, d efin itely, yes. then, K illeen. I think th at We w i l l is everything. a s k you t o o f t h e e v i d e n c e when i t 19 20 21 22 23 24 25 26 27 28 29 sign it? R ight. KILLEEN BY MR. 13 18 w i l l be c o m p le t e d you w o u l d n ' t mind coming i n h e r e t o COSTELLO 17 sig n the W i l l t h a t b e s e n t o u t t o me? 12 16 Thank few d a y s . END OF EXAMINATION OF DR. 15 I w a nt t o make my p e a c e w i t h t h e R e v e n u e 11 14 yes. THE EXAMINATION WAS THEN CONCLUDED JUSTICE ?Rot-huts SO 11000 I r is h ‘ I n te r c o n tin e n ta l B a n k L td . 91 MEBHION SQUAHfi. DUBLIN 2. A llie d I r is h B a n k s p ic t e f t L __ £UJMMflNflU ?>A\ amount _________________, ___ BAYTOTHEOHOBHOP a . v < A \< ^ --------- --------------------------- . A M Q U N T O F H ttJ N Q S I tt- W O W W — *‘ i t o f m a u u n d i Thouumte T«n« o**«- 0 ^ > o c - XM R £ \Iq , O o o l-o o ' — • Pa# aim* a n hfthalf aM RIS HIMT«IICONnN«l P.O. Box 887, Grind Cayman, Cayman Islands, British West Indies Tel* 765144/763065 F a x 512035 Telephone: (809) 949-8655 Telex: CP 4305 Facsimile (809) 949-7944 (809) 949-5267 VIA FAX 10th June, 1992. Ronan Redmond, Esq., Corporate Services, Iriah Intercontinental Bank Limited, 91 Hercion Square, OUST.TM DUBLIN 3. 2. ____ r •'•f * •• >f?% — 3”^ ’".• " "" \’o • JUhim 100? N 1992 s s 1 )• •' '< $ £ T e Z s * ? Dear Ronan, Could you please arrange to let, me have for collection aa aouu aa poaaible a Sterling cheque fu-. Lh. Sterling equivalent of IRE4,600 m g. Klllejn-and debit the coat to Anabacher Limited Account Youra sincerely, L JLL. For ANSBACHER LIMITED * lo o o n or rsa wrra orTKU Please reply to: 42 R tzw ffliam S quare, D u b lin 1 Tel: 765144/763065 F a r 612035 P.O. Box 887, Grand Cayman, Cayman Islands, British West Indies Telephone: (809) 949-8655 Telex: C? 4305 Facsimile (809) 949-7946 (809) 949-5267 8th June, 199,2. Ronan Redmond, Esq. , Corporate Services, Irish Intercontinental Bank Limited, 91 Merrion Square, DCJBLIN 2. Dear Ronan, Could you please arrange to let me have for collection on Wednesday morning 10th June a Sterling cheque for the Sterling equivalent of IR£46.00 payable to C. _lesfl_flnd debit the cost to Ansbacher Limited Account Ho, Yours sincerely, Uc»«v. L .JU L Po;X ANSBACHER LIMI P.S. I would appreciate it if you could advise the Irish Pound/Sterling Exchange Rate used for above which I would like to have at same time as cheque. AiaMBx*o7THXAfnajuamiwwATOULjran^aouyj»a»OAMiiawrraomcH , Please reply to: 42 Fitzwilliam Square, Dublin 1 Tel: 765144/763065 Far 612035 P.O. Box 817, G o o d Cayman, Cayman Islands, British West M it s . Telephone: (809) 949*8635 Telex: CP 4305 Facsimile (809) 949-7946 (809) 949-5267 11th June, 1992 Ronan Redmond, Esq., Corporate Services, Irish Intercontinental Bank Limited, 91 Herrion Square, DUBLIN 2. Dear Ronan, I return herewith Sterling cheque for Stg.£42.36 payable to C. Killeen which you issued on 10&* - Unfortunately thi is not now required and I should be grateful therefore if you would cancel it and reimburse Ansbacher Limited Account Apologies for the confusion. Yours sincerely, ^ tc u w ^ 783068 ftcalmiUa: 612035 Q jb - * . u a C . 42 FITZWILLIAM SQUARE DUBLIN 2. 26th June, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness A Mahon Limited, 17 College Green, DUBLIN 2. A Dear David, *> # ^Could you please arranga to debit the Account of /T)dt . T.C..Killeen No.11981001 with IR£2,400.00 and credit that amount to Kentford Securities Limited No.2 Account No.12460002. . o I would also like to have an up to date Statement of Dr. Killeen's Account. Tours sincerely. J.D. Traynor. JDT/AJW > 42 RTZWILL1AMSQUARE, DUBLIN 2. Tal: 768144/7B306B Fax: 012035 12th November, 1990 M. David Humphries, Esq., Senior Manager - Operations, Guinness £ Mahon Limited, 17 College Green, DPBLIN 2. Dear David, •' Could you please arrange to have IRE5,400 transferred from the Account of Dr. Coin Killeen No.11981001 to Kentford Securities Limited Account No.124*''^'’ Yours sincerely, J.D. Travnor F IL E U N B E R l 42FtawflHam Square, Dublin 2. “ Ansbacher limited Bmj Mubachr BoUbtti PLCtM m MmUig Gm^ P.O. Bn *17, Ocud Cqmu, Ntf* l e nH cP )M H iO /4 TUtx CPtttf Hue 009) MMM (M)94MaC7 TH: 765144/763065 F a s 612035 10th June, 1991 M. David Humphries, Esq., Senior Manager - Operations, Guinness A Mahon Limited, 17 College Green, DUBLIN 2. Dear David, Could you please arrange to let oe L.-..~ . r collection on Wednesday morning IRE1,000.00 in ouh from the Account of ^^Dr. Killeen, Account No.11981OOK/^ ih ^ O t.C A Yours sincerely, A r*AL ^ j s l000‘OO O tflK * \ ^ i ) J .D . Travnor. T«l: 876 5144*76 3065 Fax: 661 2036 42 RTZWHUAM SQUARE DUBLIN 2 5th July, 1993. M. D a v id H u m p h ries, B s q ., S e n io r M anager - O p e ra tio n s , G uinness i Mahon L im ite d , 17 C o lle g e G re e n , DUBLIN 2 . , D ear D a v id , C ould you p le a s e a rra n g e to l e t ne have f o r c o lle c tio n an I r i s h Pounds d r a f t f o r IRei,000.00 p a y a b le to Bank o f Ir e la n d and d e b it th e A ccount o f D r ^ o lm and D r . I t a K ille e n N o . 13180001. Yours s in c e r e ly . -----(JL m a *. 1M. 768144/763068 M i c 612036 42 FITZWILLIAM SQUARE DUBLIN 2. 22nd M ay, 1990. I M. D a v id H u m p hries, E s q . , S e n io r Manager - O p e r a t io n s , G uinness £ Mahon L im it e d , 17 C o lle g e G re e n , DUBLIN 2 . D ear D a v id , C o u ld you p le a s e a rra n g e t o - have th e A ccount o f D r . C o in K i l l e e n , N o .1 1981001 d e b ite d w it h IR E 5,000 and t o ha ve t h a t amount c r e d it e d t o K e n tfo rd S e c u r it ie s L im ite d N o .2 A c co u n t N o .12460002. \ \ Y o u rs s in c e r e l y i O “T~V.' - J .D . Tra y n o r. JDT/AJW .• Strictly Private & Confidential The Inspectors Ansbacher (Cayman) Limited 3rdFloor Trident House Blackrock Co. Dublin F-'.R l;-Tnpii->Chambers 3 Riiriipqton Road Dublin 4. Tel: +353 1 202 6400 Fax: +353 1 667 5200 DX 25 Email: lawyer@efcie W eb site: www.efc.ie ourref TL/PH/IC22074.001 Re: Z*' yourref 20thDecember2001 Our client: Dr. Colm Killeen Preliminary Findings Dear Sirs and Madam, As you know this firm represents Dr. Colm Killeen and the writer attended with him during the course of his interview with the Inspectors on 15thFebruary 2000. We have been passed by Dr. Killeen the copy of your letter to him of 3rdDecember 2001. We note from this that your preliminary conclusions are that Dr. Killeen was a client of Ansbacher and that this conclusion is based on the evidence given by him to the inspectors and the further documentation enclosed with your letter. Whilst Dr. Killeen has accepted, with the benefit of having the relevant evidence put to him retrospectively, that he had an account with Ansbacher, we believe that it would be entirely disingenuous for your report not to record his ignorance of this fact at the time during which the account was operated without his knowledge or consent. In this regard we would refer you, in particular, to pages 5 and 6 of the transcript of his evidence in which he states “to be truthful......I thought Ansbacher was a man, because I never heard the name mentioned before that”. We would also refer you to the following sections of the transcript:Page 9 - lines 20 - 24 Page 14 - lines 14 to 19 Page 15 - lines 1 3 - 1 8 ".............. but I never dealt with Ansbacher, whoever it was, I always spoke to Des next door. ” Page 20 - lines 13 —16 Page 22 - lines 4 - 26. It is quite evident from the extracts to which we have made reference that Dr. Killeen was a perfectly innocent party in relation to any dealings with Ansbacher (Cayman) Limited or its associated or subsidiary banks. He invested money through Mr. Traynor in Guinness & Mahon Bank on the basis that it provided a better interest rate and on the (then mistaken) belief that the appropriate income tax would be deducted at source. The monies passed to Mr. Traynor for investment were all declared income and he made a payment to the Revenue Commissioners at the earliest possible opportunity in settlement of unpaid taxes arising on the interest earned. Partners ' i Cokn: f-inei'o khupi■■■kiicivi"! WOurici..+: David c'isor Ter"/ Leiyjett Gerard Coll BniryO'Noil Leonora Malone David Cantrell r:'.' -I';1 ' Associates kmon Ucf.irnvik M.-ir; E. Barrett John Costello Ih!a" (VSuilivan Lilian Halpm Ronan O'Neill '.Uni.'- ■;i i '1■"'' : tv I.V;i ''i:■(til pehoiak \div WilliamAylriier MiroUMrGuuh Oa'/irl l-lnckeit Consultants lvl.nr)ai>;t Bnrkc-S!nunton Futh l:inlay We believe these factors should be properly recorded in your report. Failure to do so would be to make a finding that does not reflect Dr. Killeen’s right to fair and proper procedure and would impinge on his rights to natural justice. He will take all appropriate steps to protect his position. Yours faithfully, f:\uscrs\phf4ckettVdec01\killeeti2ninsp doc A p p e n d ix X V (6 3 ) M r R ic h a r d L a w e s & P ic to n I n v e s tm e n ts L im ite d 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Richard Lawes and Picton Investments Limited. a) Extract o f transcript o f evidence o f Mr Padraig Collery dated 11 January 2000 . b) Letter o f 9 November 1976 - GMCT to SKC Services. c) Letter of 11 January 1982 - Guinness and Mahon to Central Bank of Ireland. d) Letter o f 4 January 1983 - Stokes Kennedy Crowley & Co to Guinness and Mahon. e) Letter o f 7 April 1977 - Guinness and Mahon to Picton Investments Ltd. f) Guinness and Mahon statement of a/c at October 1977 re Picton Investments Ltd. g) Deposit dealing slip - GMCT re Picton. rs A. i I didEL’ t recall it but there is documentation that 2 when X was going through with Mr. Ryan that it 3 showed that 4 went through the accounts o f •Hamilton Ross. 5 q. 295 had some transactions which what these are names of other persons who had an 6 interest in this deposit whom you don't remember but 7 whom you sure satisfied were involved? A. 8 have had relationships there. 9 10 Prom on the evidence that is coming to us, yeB, they Q. 296 And then names mentioned by Mr. Ryan as having 11 association, Picton investments Ltd, is that another 12 name you do not remember? . A. 13 No, Picton Investments Ltd , to the best of my 14 knowledge, whilst it was a Cayman company had an 15 account directly with Guinness & Mahon in Dublin, in 16 its own right. 1? Ansbacher or Hamilton Ross or College Trustees. 18 was a company that had a direct relationship with 19 Guinness & Mahon Dublin. 20 297 Q. It didn't have any relationship with It Do you know who was the person, the beneficiary who m ' controlled it? 21 A. 22 I think it had associations with Mr. Lawes and 23 Mr. Lawes had something to do with Connaught Foods 24 Ltd. 25 26 2 8 Q. MS. MACKS?t Mr. Richard Lawes was it? A. I don't know the first name. I believe he was a 27 scientist or a chemist. 28 I met him on one occasion but nothing more than that 29 do I know about him. I know he was from the UK. G U IN N ESS M A H O N CAYM AN TRUST LIMITED A Member ol lha Gulnnasa Mahon Merchant Banking Group Rtt Bex887 GrandCayman BrIUahWaat India* mAv«No 9-4653(4 ^ CP305 j- m-'hi GufnnaM 9th November, 1976. E. Keegan, Esq., S . K . C . Services, Har.court House, Harcourt Street, DUBLIN 2. Dear Hr. Keegan, Ve have today received from Guinness + Mahon . Limited on behalf of Picton Investments Limited £500,000 being dividend from Connaught Foods Limited. Ve have arranged vith Guinness + Mahon Limited to place these funds for one month to 9th December at 15%. The funds are Eurosterling and the rate is based accordingly. • Yours For GO it h f u lly , ON CAYMAN TRUST LTD. t l t h J a n u a r y , 1982. O u r R e f ; M C K 'ciK E x c h a n g e C o n tro l D e p a r tm e n t, C e n tr a l 3 a n k o f I r e la n d , Dame Street, 2 U S L I N , 2. f" * ' D aar S ir s , ! •' i , C o n n a c h t F o o d s L im ite d P e r m i s s io n Is s o u g h t f o r t h e p a y m e n t b y t h e a b o v e C o m p a n y o f a d i v i d e n d o f £ 5 0 0 ,0 0 0 to i t s p a r e n t c o m p a n y , P lc t o n I n v e s t m e n t s , P . O . t io x 8 3 7 , G rand C aym an . * . ' Vr. A e e n c l o s e t h e u s u a l l e t t e r fr o m t h e C o m p a n y 's a u d i t o r s . 7-nir* faltnfi.lly. n Harcourt House. Harcourt Street. Dublin 2, Ireland. Telephone (01) 757971 Telex 24494 V S to k e s K e n n e d y C r o w le y & C o . W « Chartered Accountants OurRef. EK/MH Your Ref. 4 January, 1983 Guinness & Mahon Ltd., 17 College Green, Dublin 2. ■s, £) i ' .Attention: Mr. Martin Keane -*■ Dear Sirs, . " Connacht Foods Limited We are auditors of the above company. • ' We understand that the company proposes to pay a dividend to its shareholders of £500,000. We confirm that in our opinion the company has adequate Retained Earnings and Resources to allow payment of a dividend in the amount stated above. Yours faithfully, (L a , STOKES KENNEDY CttDWLEY & CO. Al<« Uurra luhn Callaghan Kim Carroll Dcvlan C'iillin% Niwl Gxike CiMKir Ciu*kY UweiHX(‘um-lcy William Hifejr Edgar Forsier Normal) Judge Kdward Keegan Anihony Lynch Dnmml Miller Jtihn Nadi Hnon O'Cuniuir FergusOTierney Dun KcM A lci Spain Michael SpclUn»« (Jarrell WmUtt ’• Oxnultinb Norman link KixiakJ lltilpcr ChrKtophci Cullen Mark IJobhvn Jim Dnorly Kiehard O IIkcv HelfaM, Cork. Galway. limenek ami New York Kim Harm Noel Hollamt RayJackson Jerome KcnneJv Mietiacl MacNamara Gerard McEvoy Paul McGowan Niall O'C'armll Michael Varian lien Wilson Hubert.Wiiodv Associate Niall Crowley n G U IN N E S S + M A H O N IT D 17 C ortege G reen D u b fin 2 R Q Box SSATfetephone;782444 n tn n In v e stm e n ts 7 * h APr l l » , c 7 o T j " .A .F u r 2 e , E s q T T G u ln n e s s Mahon Cayman T r u s t U d . P .O .B o x . 8 8 7 , . Grand Cayman. * • ' . BRITISH WEST INDIES. . D e a r S irs, W e con firm h a v in g a c c e p te d t h e fo llo w in g f u n d s from y o u : Vahm 7th April, 1977. Amount £524,570.15 (Sts.)* pieawRty Existing deposit plus i ‘ * , Yourselvea. forAccount . Fixed to 6th May, 1977 Tam Ratsftparannum ^ O . ' ^tawHPdThrough 9. Direcft. Youra faithfully, for QUMMBdS+MAHONUP UfuriMf.p1 MV Hm C mS £ iMm M7 Colag*O m iiD ublal BillWmiWrtjtwmBW‘ NW'ImomImDIniibmHmUW •aontify^Oam A.It Bd I.CtfylmLqr*Jnr, MsOrmImm* A m n lM r o lf t e < M m M « P M « a r a u ii **—•'*i' 1 'vCT'"‘v-v*&'.b'V‘ '' ' '• A'.-.*- if f . J W W W J T . .....,, ..ACCOUNT- ■ .......... ACCOUf y o m itiO T l. J P »9 « n o . f t i q M t rO > - / 1 i / 7 6 yi 50S •••• •. ;•■ . . # 0 jC f/2 /7 7 AT. 15KX .'V'rti’ ’ 526, 476.83 ; >rV 526,476.33/* ! 52^ 47 6.82' ' *"% 5£6,476.82 . 526,47 >j33 •20iSlfi,45 •; 524476j 3 . , '.... .' . r **»7. U f e \. jJfig'4 W S2M76iBf & ^ '4 7 6 ^ -. 6 ^ 4 7 5 ,6 3 '• jfeM 7*.8S : •• • ■,•', ........ '• ‘ . . . . ‘ .'■ ■ [BEL!.V •' v > i.*^ • •• •• •. . • ^ — •.■•' \-■& t r»wtI•: ew - a S Wfttftdr '.•. ’ •*'■,ftSo#i«arcMr • Mfe-.Plctori in-Vedtfaianta Lt<3U, P v O ; 8 & 7 f{ &rand C ab m a n ; ^v'- Brlti'ih'Wefs.fc -Iliidieg. . ' v v. ••«***••.“ ••.* •* * . Guinness & Mahoii Ltd 17 COLLEGE GREEN DUBLIN2 •. • T ELg^ONE 7824.44 TELfe^ ''5205 . . DEALING sup Data .H. ?4 Customer .4 Q, .- ., . TiA p p e n d ix X V (6 4 ) M r F r a n k L e e 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Frank Lee. a) GMCT memo of 16 December 1976 to Mr TR Leonard. b) Letter o f 9 December 1976 - GMCT to Mr Frank Lee. Correspondence received from or on behalf of Mr Frank Lee. a) Letter o f 3 December 2000 - Mr Frank Lee to the Inspectors. VK 5205 MARS E l 305GUINNESS CP ATTEN TIO N HR. T.R. LEONARD . PirOUNDS t Q . M 8 . 1 0 . ‘ ‘ ' . . N THE CASS OF FRANK LEE H IS DEPOSIT BALANCE IS DOLLARS S .W & .O O . LUS INTEREST OF DOLLARS 13.33 MAKING A TOTAL OF DOLLARS 5467*33. __ , H I S HAS BEEN CONVERTED ALSO A T I .6 7 PRODUCING POUNDS 3 2 73 .85 •— &■ HI CH AMOUNT SHOULD ALSO BE DEBITED TO THE'SUNDAY SUB-COMPANY „ CCOUNT AND PAI D TO H I M. I AM NOT CERTAIN WHETHER IN H IS REQUEST^** 0 WITHDRAW THE BALANCE FRANK WISHED TO INCLUDE THE LA TEST £/•(,-> A REDIT OF DOLLARS 5 .0 6 0 AND SUGGEST YOU CONTACT HIM TO B0TA1N “ - A R J F I C A T I Q N ON T H I S P O I N T . 4 BOTH INSTANCES IS SHOULD BE GRATEFUL IF YOU WOULD ADVISE THE E F I C I A R I E S OF THE DOLLAR'AMOUNTS AND CONVERSION TO POUNDS AND •f A 1N THEIR SIGNATURES TO A COPY OF YOUR LE TTE fT THEREBY ACKNOWGING R E C E I P T . THESE COPY' LETTERS SHOULD BE FORWARDED TO US IN E COURSE. y • 3 ?(Mum- i GUINNESS M A H O N CAYMAN TRUST LIMITS) A MwnlMr el tba SuiwaM Mahon MwoHwt BMklna Snup TataphOMNo •—*281/4 T«Im <7306 your rat it h OceonbcA. 1976 Jtt. Ruuifc Lee Uonttnottt .«U CoJtk ■; TKELAHV * ’ .flu* Funk, REDNAU XMVESnram LIMITED KEPHALL THOST......... ' ’ ’ .Tfcutfc you ( m foot ImJOxk ©< tftth HovtwBtt eonturning agtumtnt to tht tCguuA puvJULtd In the aJeeoanti ot; X K ) i x a a X which tccowifnnlid my Z it t M to fpou o{ fStn 6eto6e*. ' 1 mom heart pUatu/u <61 eMatrt&a «it vapdattd Betatee Sheet pKtpaJud m a t Sadi Novwbee amf expuMerf «£n Fptmd StaxUn§. fJum tkU mill lee that thou, hoi been a 4 U f h t ttducUon 4 t the {mm ' {{flute by u&ttuc of -the foot that M have m itte n o f( the . . . 4ha*cA a t eo*t. /ott mU£ t u a U that tfceit, «ha*e* wrte told mi tht saU ptoettdt eAtdUed d/Matty to the account o{ X x x at Bank. -liu i oh tht feofXt and Lou Account U tht intvutkt touted on tkt x x x dtpotlt account ptUoK to the coKMJUten 0 { the balance o{ tht account Into US dotla/n. . In 40 fa*, oa Hit < , I pupate -iiuttoettug At Lcmttrf to e lo it th e jcx e*££ d tpo tit aaeoant n m lttln g th a t, {w tdi to at (ofi e x e d it to t k t a u v u n t aaaoant o{ . xf> ' I take eetim Meet! «*£tfc youA approval. Owe* -tfeecou&ie o i t k t n tx t i**t d a y i, I m ill be u n itin g to you itn d in g U m U w t accounts both in Foawf S u itin g and 0 .3 . d o lla u (on th t m tS m t n t l t l u m lth uhiah m t a n t m tn a tly in v o lv td . Vov/u tin a s ju ly , JflHW A. ROSE Ei t a l t . A /L /*• {) /L ex t£-^-rv£ j t~& i.^- a} / & f)- O d z> &U1 -7 )£ d . - ^ ^ 3 2~ & *> t ( H &fi L t - ’T'v. t(.3 3 A* ! $ I I C '€ A ^*;/L ' 7 ^ - 1 <> £. /v r* /! / - / e < ^ ’ £. / t C <1, ^ ’v (- ^ u fa i-r H $ J U s C - t& j /f^ ^ U jL S ft tx ^ ^ C’^-' ^ + * 4 .b * r U r n « _ s i/ A / . ,L e ^ ° S ■*” * +4.------ - *4~& gL iL e A * -* ^ b sL ^r- 1 ;<»/ 0 % ^ . £ t^ ,_____ . ^ / ‘V -d&> (f^ -^ t ^ u c ^ ' s s u c -t^ ' ^ ^ -^ - U ^ l ^ SVL ; ^L - ^ c l a . f r ftl. P~ £(.V {Q . ^/&.c>-i%(/~^-' •'•■ ';-'< ■'p''-1 ‘ p ^ s .- t /) ,'.$ £ y . ri c t ' / S’”’* /-, ' ^ . y a r te .7 * . ^ » e U ^ ^ -S . z^ £ w .e + U & (i^ ^ U slyt'Z h - ^ cU- /t^ /L 'tfZ is / /J-tdLCLtfV^ hi J! ^A - 'W ^ y /9 ll~ ^ ’ . ^ p v/ /C -£ e . g ^ - r * * . 7 c>2 ^ u tf ^ J) tT t f s r f ^ iu i ^ t* .- r * v t <4 , ■(* .'t i t ^ - - JL ^ 1& .^ : /ic ^ ■ (k-T ^ L ^ tg nd-~ f e t e jb - ^ ts u - 'j/L ^ u ^ f- ■ d * r J ( l* d , ^* i/d U ^i-1- ^ ' M * r .'j& A Q . i4,e-iu, yf '"~" "x ^ & J -L "? (.< u ~ fiy * U i . /la u -* .d ls <■/$ JU & ™ L e .< l >j - u *, ^ T*« . ^ £- K Daar David, Could you plaaaa arranga th a l i n a o f a S ta r lin g D raft f o r S tg .878,000.00 payabla to Laydan (Scunthorpa) L ia lta d and d a b it Anabacbar L ia ita d Account Ho.13154602. X would lik a to hava t h i s D raft c o lla c ta d on Friday nom ing p laa a a . Yours s in e a ra ly , J.D . Traynor. JDT/AJW A Mtmbtrcfdm Hnwy Aiubtdm Holdings H C Merchmti Banking Group Pleasereplyto: 42 FitrwQliam Square, Dublin! Tel: 765144/763065 Far 612035 P.O. Bax M7. Grmnd Cayman, British W«r India Pboar. (MB) 9494633 4 T«t«c CP430S Fas (109) 949-7946 (109) 949-3267 13th G a r re tt Logan, Esq., Irish Intercontinental Bank Limited, 91 Marri o n Square, DUBLIN 2 . Daar .Garrett, Could you please arrange to lat me have for eollaction two Starling Drafts as follow: Payable to A. Bennett £1 f6 4 0 . 0 0 0 T t O ‘ KO6' Payable to D. Leyden £8,550.0<^\.o'UO> Pleas e debit the cost of each to Ansbacher Limited A c co un t No.02/01087/81. Yours fincerely, f H r “ ' T*' —* ~»-■- ANSBACHER L IM IT E D * 7 - .- nninl :Lu wit?. ?wuw? Sn .2727? i I 91+ mm Laydcn 42 gig. Michad [Auden #9 A ppendix X V (66) M r Jam es H enry Lindsay 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James Henry Lindsay. a) Transcript of evidence o f Mr James Henry (John Harold) Lindsay dated 24 March 2000. b) Guinness and Mahon statement of 19 February 1987 re GMCT. c) Telefax of 31 March 1994 - Cayman International Bank & Trust Group Limited to IIB. d) Letter o f 13 October 1992 - Ansbacher Limited to IIB. Correspondence received from or on behalf of Mr James Henry Lindsay. a) Letter of 3 December 2001 - Gore & Grimes Solicitors to the Inspectors. UNDER OATH ON FRIDAY, 24TH MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. JOHN HAROLD LINDSAY Represented by: MR. KARL HAYES GORE & GRIMES WITNESS MR. J. LINDSAY I EXAMINATION MR. JUSTICE COSTELLO PAGE 1 2 3 4 MR. JUSTICE COSTELLO: Mr. Lindsay, we will start our interview. 5 6 MR. LINDSAY: Yes. 7 MR. JUSTICE COSTELLO: My name is Declan Costello and Ms. Mackey is on my 8 9 right. We are the Inspectors, two of the 10 Inspectors, appointed by The High Court, as you 11 know. 12 MR. LINDSAY: Yes. 13 MR. JUSTICE COSTELLO: I should explain to you 14 that this is not a Court. 15 It is not a tribunal. 16 MR. LINDSAY: Right. 17 MR. JUSTICE COSTELLO: It is an investigation. 18 MR. LINDSAY: Sure. 19 MR. JUSTICE COSTELLO: If in the course of the questions that we ask, you 20 21 wish to consult with your solicitor please tell me 22 that you wish to consult and we will stop the 23 questioning while to do so. 24 MR. LINDSAY: Yes. 25 MR. JUSTICE COSTELLO: If your solicitor wishes 26 to consult with you he can 27 indicate this to me and we will stop questioning for 28 that purpose. 29 1 2 investigation your 3 evidence will be taken under oath and I will ask our 4 solicitor now, Ms. Cummins, to administer the oath 5 to you. 6 MR. LINDSAY: Yes. 7 MR. JUSTICE COSTELLO: No, it is all right. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Do I stand up? 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 one preliminary matter 6 that I want to raise with you? 7 A. 8 2 Q. 9 Yes. In our letter to you we asked you for a detailed statement about your relationship with "Ansbacher" 10 11 Mr. Lindsay, there is and we have not received any statement? A. 12 Just a moment ago Mr. Hayes here mentioned that to me . 13 3 Q. 14 A. Yes? There was a chap in Deloitte Touche called 15 Eamonn Coates and I understood from him that he had 16 made the arrangement that I come here and, in fact, 17 that was it. 18 4 Q. I looked through that. However, Mr. Lindsay it could not be clearer. We 19 asked in our letter to you for a full and detailed 20 statement of all the dealings that the company had 21 with you either directly or indirectly. 22 the problem about giving us a statement? 23 A. Absolutely no problem. What was I mean it is a stupid thing 24 to say but I didn't even see that because what I 25 immediately did was I got in touch 26 with Eamonn Coates. 27 5 Q. 28 A. 29 6 Q. What is his name? Eamonn Coates. Coates? 1 2 7 Q. 3 A. 4 8 Q. 5 A. Yes? They were our accountants. Yes? And I understood that he had contacted this office 6 here. 7 on the 24th". 8 9 Q. 9 Yes. He said, "What you have to do now is turn up Did he not advise you that you should make a statement ? 10 A. 11 10 Q. 12 A. No, he did not. Did you not see this in the letter? No, I didn't. I must admit that when I saw so much 13 of this letter I thought, 14 for my accountant". 15 11 Q. 16 A. 17 12 Q. 18 A. 19 13 Q. 20 21 Yes. "Well, this is something Perhaps, you can outline now to us? Yes, certainly. What your...(INTERJECTION)? In other words my understanding...(INTERJECTION). No, sorry, just wait now. Just before we go on. We also asked for all the documents that you had? A. 22 I don't have any documents. I haven't had for maybe ten years or so. 23 14 Q. 24 A. 25 15 Q. 26 A. From before that. 27 16 Q. From before that? 28 A. 29 17 Q. Who were your accountants? Deloitte Touche. From 1979? Yes. Have you asked them have they any records or 1 2 No, but I presume they have the records, all our tax 3 records. 4 18 Q 5 A 7 19 Q 8 A 9 With which company now? With "Ansbacher"? I don't think we had any relationship with "Ansbacher". 10 20 Q 11 A 12 21 Q 13 A 14 Do you not? I don't think so. Well...(INTERJECTION)? Because at the time when our company...(INTERJECTION). 22 Q 16 17 However, also all your relationships with the company, would they not have? 6 15 Yes. No, I am talking about your company. I am talking about you personally? A No, I know personally. When it went belly up -­ 18 that I think was about the time that 19 Guinness & Mahon became involved with "Ansbacher". 20 23 Q Are you saying that you had no relationship at all 21 with the company, with Guinness Mahon Cayman Trust 22 Company, which subsequently changed its name 23 to "Ansbacher"? 24 A 25 24 Q 26 A 27 25 Q Yes, certainly with Guinness & Mahon, yes. No? Very much so. No, I am asking: Did you have any relationship with 28 the company itself, with Guinness Mahon Cayman Trust 29 Limited? 1 2 26 Q. 3 A. 4 27 Q. 5 A. 6 28 Q. 7 You did? Yes. Personally? No. Well, the company. No, no. Leave the company. I am not asking you about the company, Mr. Lindsay? 8 A. 9 29 Q. 10 Yes. I am asking you personally. Did you not have a personal relationship? 11 A. 12 30 Q. 13 A. 14 31 Q. 15 Yes, yes. You did? Yes, subsequent -- well, we will come to that. How are we to carry out this investigation if you have not given us the documents? 16 A. 17 32 Q. 18 A. 19 33 Q. But I haven't got any documents. Your accountants have? I presume they have. Very well then. Tell us about your own personal 20 relationship with Guinness Mahon Cayman Trust 21 Limited? 22 A. 23 Right, Cayman -- you see that is subsequent to the Super Ser business. 24 34 Q. 25 A. Yes? Because when the Super Ser business went flat I got 26 a job in Bangladesh and during that time I had 27 problems at home. 28 and she had a Court Order at one time that I 29 couldn't issue any cheques. My wife was looking for a divorce 1 35 Q. 2 A. What year are we talking about? 1986 or 1987 I would think, somewhere about there. 3 I had three kids in college in America and they had 4 to be paid. 5 36 Q. 6 A. 7 37 Q. 8 A. 9 38 Q. 10 A. 11 39 Q. 12 A. 13 40 Q. 15 A. Alan? Ann. Ann? Ann, yes. Yes? And she was in a university called Highland Yes? Now, she wouldn't go over there unless her boyfriend went with her. 16 41 Q. We need not go into these details. What were the other sons? 18 19 A. 20 42 Q. 21 A. 22 43 Q. 23 A. 24 44 Q. 25 A. 26 Well... (INTERJECTION) . Had you sons? Yes. What were their names? Yes, Ralph Lindsay. Yes? And he was in Washington State University doing forestry. 27 45 Q. 28 A. 29 Ann Lindsay. University near Alberqueque New Mexico. 14 17 What are their names? Had you another son? Yes, Alan. 1 2 47 Q 3 4 Yes. You were saying then that something happened in 1986? A Yes. I rang up Mr. Traynor and said, "I have got a 5 problem here and any money that I have sent to a 6 bank or to Dublin I can't write a cheque on it." 7 So, he said, "You just get the money sent to me and 8 I will sort that out," which he did. 9 Cayman and that is how I became involved with -­ It was in 10 personally now, that is how I became involved with 11 Guinness & Mahon Cayman. 12 48 Q 13 A Yes. Tell us what the arrangement was? The arrangement was that the money would be sent to 14 him and then whenever I wanted money sent to pay 15 school fees or anything like that he would forward 16 the money. 17 49 Q 18 A 20 50 Q 21 A 22 51 Q Yes . Did he tell you what he was going to do with it? No. He was going to pay any bills that I wanted Did he tell you it was going into the Cayman, the Guinness Mahon Cayman Trust Company? A I don't remember him using that term actually but...(INTERJECTION). 26 27 52 Q 28 A 29 You forwarded money to him? paid out of it. 24 25 Did he tell you what he was going to do with the money? 19 23 Yes. What did you understand, Mr. Lindsay? Well, in those days -- I mean I certainly hadn't the same understanding of Cayman. 1 53 Q. Mr. Lindsay, what did you understand that he was 2 going to do with the money? 3 it? 4 A. 5 54 Q. 6 A. 7 8 Where was he going to deposit it? I honestly don't know. I presume it was Cayman. Yes? Because it was out of the jurisdiction of the Court Order that was against me. 55 Q. 9 10 Where was he putting Yes. Tell me everything now that you can about this arrangement ? A. Well, that worked okay. All the fees were paid and 11 all the rest of it. 12 years in college and when it was more or less over 13 there was a remainder and I said -- 14 Spain who was getting married and I got the 15 remainder sent to him to buy his house. 16 56 Q . 17 A. 18 57 Q. 19 I had a son in Yes. That was the end of that association. Yes. Did you enter into any Trust Deed in relation to this arrangement? 20 A. 21 58 Q. 22 A. 23 59 Q. 24 A. 25 26 Each of the three were four No, none at all. You just...(INTERJECTION)? It was just done ... (INTERJECTION) . You just handed on money to Mr. Traynor? Yes, and that was the way I had dealt with him from the very beginning. 60 Q. 27 Yes. Did you pay any tax on the interest that the money earned? 28 A. 29 61 Q. No. I don't even know if it did earn interest. Mr. Lindsay, I want to put some documents now to you 1 that have come into our possession as a result of 2 the investigation. 3 "Resident & Non-Resident Loans". 4 is 1973. 5 (Same handed)? 6 A. 7 62 Q. 8 This is the first ledger It is one that If you would hand that up to him Thank you. No, no. It is not that. MS CUMMINS: It is, Judge, I have taken 9 the names out of it just. 10 MR. JUSTICE COSTELLO: Yes, 11 all right. up (Same Handed). 12 A. 13 63 Q. Thank you. Sorry, would you just give me that back please. 14 does not matter about the names Ms. Cummins. 15 me that letter? 16 Just hand it up (Exhibit 1) 17 A. 18 64 Q. 19 It Show It does not matter about the names. (Same handed)? Yes. This is a record from Guinness & Mahon here in Ireland? 20 A. 21 65 Q. 22 A. 23 66 Q. Yes. It is a record of "Resident & Non-Resident Loans"? Yes. It refers to you Mr. Lindsay, "J. H. Lindsay," and 24 it is a loan of £17,000. 25 loan of £17,445.80. 26 date is 1973 and then the comment "suitably 27 secured," is written after it. 28 1973 to you personally? 29 Hand it There is a balance on the You will see that the repayment This is a loan in 1 67 Q 2 A 3 68 Q 4 A 5 69 Q Maybe. I don't know. You do not remember? No, I don't. You see the information which we have obtained 6 Mr. Lindsay is that the phrase "suitably secured", 7 means that it was a cash back loan and that it was 8 on a deposit in the name of Guinness Mahon Cayman 9 Trust Limited? 10 A 11 70 Q Yes . That is what the "suitably secured" means. If this 12 is so this would appear that you had a loan from 13 Guinness & Mahon as far back as 1973 that was 14 secured on -- that was cash backed? 15 A The only security that Guinness & Mahon ever got 16 from us was -- I know I have to answer you directly 17 but may I go just a little bit beyond that? 18 71 Q 19 A 20 Yes ? When we first of all got the agencies for these units, these heaters, portable gas heaters. 21 72 Q 22 A Yes? We brought some of them home and they -- obviously 23 there was an interest in them and over a year they 24 started to, you know, sell. 25 could get in a big number of these we could 26 definitely sell them. 27 Yes? 28 So, I went to the Bank Of Ireland, which was my bank 29 and my father's bank and my grandfather's bank, but We then felt that if we 1 any way they wouldn't give us the money. 2 matter of fact it might have been -- I don't know if 3 that would fit in with that or not but it might have 4 been about £17,000. 5 Yes ? 6 A As a It was a big sum then. And we were with Haughey Boland then. They were our 7 accountants and they sent us to Guinness & Mahon and 8 there I met Mr. Traynor. 9 definitely sell these?" He said, I said, "Can you "Yes, absolutely, 10 definitely." 11 I said, 12 would take a percentage of them." 13 me a substantial order from Calor Kosangas and I 14 will give you the money". 15 75 Q 16 A He said, "What proof can you give me?" "Well, Calor Kosangas have said that they He said, "You get Yes? So, I went to Calor Kosangas and they agreed to take 17 them and I gave him the thing and he gave us the 18 money. 19 76 Q 20 A 21 77 Q This is you? You say "us" Mr. Lindsay? Yes, the firm. No. However, this is not a loan to your firm. 22 will come to the loans to the firm in a minute. 23 am talking -- this is a personal loan to you? 24 A 25 78 Q 26 A 27 79 Q 28 A 29 80 Q I Well, maybe at that stage it was a personal loan. Yes ? I don't even know if we were a firm then. You see the phrase "suitably secured"? Yes, I do. I 1 2 81 Q. 3 Did Mr. Traynor then make the arrangement that you were to transfer money to the Cayman Islands? 4 A. 5 82 Q. 6 A. 7 83 Q. No, he never mentioned that. You say that was in 1986? That was -- yes, that was much later. I see. You see I have to suggest to you that this 8 loan was continued on Mr. Lindsay and that the 9 documents show that you were still indebted 10 to Guinness & Mahon in 1975. 11 Perhaps, I gave you the wrong date. 12 that was the repayment date. 13 other document "J. H. Lindsay" 14 A. 15 84 Q. That is the first one. It was 1973, Would you look at the (Same Handed)? Thank you. Again, "suitable secured". I must suggest to you 16 Mr. Lindsay that that loan, probably it was the same 17 loan, was secured by a Cayman deposit? 18 A. No, it wasn't. The only security, as I say, that we 19 ever gave Guinness & Mahon, and it happened again 20 later, was in the form that he would advance money 21 against orders. 22 85 Q. Mr. Lindsay, may I refer you to another document. 23 Ms. Cummins, it is the ledger account for 1987. 24 shows a draft issue to Mr. Lindsay (Exhibit 2 ) (Same 25 Handed)? 26 A. 27 86 Q. 28 A. 29 87 Q. Thank you. Do you see that? Yes. 1987? When was this, 19...(INTERJECTION)? It 1 2 88 Q. I will just show you what this document is. It is a 3 ledger account in Dublin of Guinness & Mahon. 4 the account of Guinness Mahon Cayman Trust Limited. 5 Do you see that on the left-hand side, the top on 6 the left-hand side? 7 A. 8 89 Q. 9 A. 10 90 Q. It is Yes. Do you see that? Yes. You see it is a sterling account. That Guinness 11 Mahon Cayman Trust Limited had in Guinness & Mahon 12 Limited? 13 A. 14 91 Q. Yes. Do you see about a third of the way down on the left-hand side in February 1987; 15 16 "draft issued to J. H. Lindsay"? 17 18 A. 19 92 Q. 20 A. 21 93 Q. 22 A. 23 94 Q. 24 £13,411? I don't think the figure is there, but is it? Perhaps, it is the wrong figure? Yes. Sorry. It is £1,000. it . 25 A. 26 95 Q. 27 A. 28 96 Q. 29 Yes. £1,000. It is £1,066? £1,066. Yes? I am sorry I am misreading 1 97 Q 2 Is that not a draft issued to you for £1,066.26 from the Guinness Mahon Cayman Trust Limited account? 3 A 4 98 Q I don't know what it is. Just look at it now. I could make suggestions. Does it not appear that the 5 Guinness Mahon Cayman Trust Limited account is 6 debited with this figure, this draft, which is 7 payable to you? 8 A 9 10 Cayman. 99 Q 11 12 A I have no idea. I mean it could have been for tickets, air tickets, or I don't know. 100 Q 15 Out of the Guinness Mahon Cayman Trust Limited account? 16 A 17 101 Q 18 Out of our account in the Cayman. No, this is your personal payment, a payment to you, out of the Guinness Mahon Cayman Trust Limited? 19 A 20 102 Q 21 A 22 103 Q 23 I have no idea why they put that there. Yes? I have no idea at all. All right. I want you to look at page 29. It is a report about H. Lindsay (Exhibit 3 ) (Same Handed)? 24 A 25 104 Q 26 Thank you. I want to explain to you what this document is Mr. Lindsay? 27 A 28 105 Q 29 I am just asking you about this payment to you, out to you personally? 13 14 Yes, but by this stage the company had an account in Yes . This is a report from Guinness & Mahon. April 1978? It is 1978, 1 2 106 Q 3 Guinness & Mahon. 4 to the bank? 5 A 6 107 Q 7 It is describing its major loans Yes . To The Central Bank. It has there, "H. Lindsay - £156,537". 8 9 That is you. 10 You are described as: "Mr. Lindsay is a major shareholder in Super Ser Limited."? 11 12 A 13 108 Q 14 A 15 109 Q 16 Yes . Is that you? Yes, I was a 50% shareholder. Yes. It says the purpose of the loan was "personal loan/working capital". 17 18 Do you remember that loan? 19 A 20 110 Q 21 A 22 No, I do not. Do you see it says that securities are held? Securities, "Guarantees are held up to £175,000..." 23 24 111 Q 25 A 26 112 Q 27 28 29 Guarantees ? Yes . Yes. Then it goes on: "Comment: Guinness & Mahon are happy to continue this facility to Mr. Lindsay. No facility letter was available in respect of this loan which was arranged personally by M r . Traynor." 1 2 3 I mean I never got £156,000 or £175,000 from 4 Guinness & Mahon personally. 5 that they are confusing the company and me. 6 113 Q 7 I can only suggest Would you turn over the page to the next page (Same Handed)? 8 A 9 114 Q 10 Yes . This is a continuation and it talks about: "Super Ser/H. Lindsay - £1,336,023" 11 12 and, 13 "Super Ser Limited - £1,179,486". 14 15 These are loans to, it says, 16 "Super Ser/H. Lindsay"? 17 18 A 19 115 Q 20 A 21 116 Q 22 A 23 24 Yes, all right. I don't see it. Do you remember...(INTERJECTION). Yes, yes, I see it. Do you remember a substantial loan of £1.3 million? No, I don't but I can imagine circumstances in which it could have happened. 117 Q 25 Yes. The document says: "Super Ser/H. Lindsay"? 26 27 A 28 118 Q 29 A Yes . Was it to you personally or to the company? Well, I never got anything like that. 1 119 Q 2 A 3 120 Q 4 No. You were mentioning that the company had deposits. Do you see, 5 "Security: Super Ser Limited has deposits of around £400,000 with Guinness Mahon Cayman Trust Limited"? 6 7 8 A 9 121 Q Yes . That is what you are referring to? That seems to 10 have -- the company seems to have had deposits in 11 the Cayman Islands in Guinness Mahon Cayman Trust 12 Limited? 13 A 14 122 Q 15 A 16 123 Q 17 Yes . Do you see this was in 1978? 1978, maybe. I should explain to you that I am not investigating...(INTERJECTION)? 18 A 19 124 Q 20 A 21 125 Q 22 A 23 126 Q 24 No. We are not investigating the company today? Yes . I am investigating your personal affairs? Yes, all right. However, you referred to the fact that the company had deposits? 25 A 26 127 Q 27 A 28 128 Q 29 A Yes . I am just drawing your attention to this fact? Yes. May I explain some of the intertwining? Yes, do? Well, we started off selling heaters here and we had 21 1 2 129 Q. 3 A. Super Ser Limited. 4 130 Q. Super Ser Limited? 5 A. 6 131 Q. 7 A. 8 132 Q. 9 A. 10 133 Q. 11 A. 12 134 Q. 13 A. 14 135 Q. 15 A. 16 Yes. It was incorporated in Ireland? Yes. And when you say "we" who was "we"? A man called Goosen. Yes? And myself. Yes? We were 50/50 in it. Yes? Then things began to dry up a bit here and we went to England. 17 136 Q. 18 A. 19 Yes? Mr. Goosen went to England and he started the same thing there and I was also 50/50 in that. 20 137 Q. 21 A. 22 Yes? Now, that sold an awful lot more stuff than we sold in Ireland. 23 138 Q. 24 A. 25 139 Q. 26 A. 27 140 Q. 28 A. 29 What was the name of it? What was the name of that company? I think it was Super Ser UK Limited. Yes? Or something. Yes? Yes, and then subsequently we decided that our sales were slowing down, and as the people who supplied us 1 with these heaters were getting more and more 2 expensive, and as more and more competition was 3 coming on the market it was, you know, really very 4 difficult for us to deal with Super Ser Spain 5 anymore. 6 we built. 7 141 Q 8 A 9 142 Q 10 A 11 So, we decided to build a factory, which Where? In Tallaght. Yes ? And we completely equipped that and we started to make our own heaters. 12 143 Q 13 A 14 144 Q 15 A Was that Mr. Goosen and yourself? Yes . Was that in Super Ser Limited or another company? No, I am not quite sure what we called ourselves 16 then but the product that we made was Ardant, 17 A-r-d-a-n-t. 18 145 Q 19 A 20 146 Q 21 A 22 23 Yes ? A-n-t, we were not allowed to have E-n-t. When was that Mr. Lindsay? I don't know. It might have been somewhere around 1978/1980. 147 Q Could the loans that are referred to here, in this 24 document, be loans in respect of the building of the 25 factory? 26 A 27 148 Q 28 A 29 It could be but I am not saying definitely it is. Yes? We now had a factory and we had a lot of people working in it and we had an expensive Research & 1 Development Department, and it got to the point 2 where we had to sell 70,000 units before we broke 3 even. 4 149 Q. 5 Could I just interrupt you? What is the name of the company that you are talking about? 6 A. 7 150 Q. 8 A. 9 151 Q. 10 A. 11 152 Q. 12 A. 13 153 Q. 14 Our factory? What was the name of the company? I think it was Ardant. Ardant? A-r-d-a-n-t. Limited? Yes. It was a separate factory. Did Super Ser Limited remain in business? 15 A. 16 154 Q. 17 A. 18 No, no, that ran down. Yes? So, in other words what we were doing was supplying our customers from Tallaght instead of from Spain. 19 155 Q. 20 A. Yes? But it became obvious then that -- when we started 21 to sell the heaters a bottle of gas was 18 shillings 22 or a pound or something like that, and that would 23 enable a person to give some measure of heat to a 24 house for a week. 25 156 Q. 26 A. Yes? But by this time now, up about around 1980 or 27 thereabouts, it was something like £10 for a bottle 28 of gas and that plus the fact that they do not wear 29 out the place got saturated, we knew we had to get 1 markets somewhere else. 2 see what could be done there but the sale of unflued 3 gas heaters was forbidden there. 4 there was a man in the United States who is in 5 charge of all standards. 6 157 Q. 7 So, I went to America to I went there and If I could interrupt you Mr. Lindsay? I am not today concerned about the company liabilities? 8 A. 9 158 Q. 10 A. 11 159 Q. 12 Yes, right. I am concerned about your own personal liabilities? Yes, right, yes. And your arrangements, your own personal arrangements ? 13 A. 14 160 Q. 15 Yes. With Guinness Mahon Cayman Trust Limited and subsequently "Ansbacher"? 16 A. 17 161 Q. 18 Yes. So unless what you are telling me now is something to do...(INTERJECTION)? 19 A. 20 162 Q. 21 A. Well, I think it is. With your personal...(INTERJECTION)? Well, I think -- yes, I think it has, in so much as 22 eventually we were successful and we were the only 23 company, not Japanese, German, Italian or Spanish, 24 nothing -- we were the only company to get a heater 25 passed for the United States. 26 163 Q. 27 A. 28 29 Yes. Well...(INTERJECTION)? And then we started a company in the Unites States and we appointed a man, an accountant. 164 Q. What was the name of that company? 1 Well, I now -- It probably has our own name. 2 not too sure but I know the name of the product that 3 we sold was the Shamrock heater. 4 165 Q However, again, I want to explain to you Mr. Lindsay 5 that I am concerned about your own 6 personal...(INTERJECTION)? 7 A 8 166 Q 9 A 10 167 Q 11 A I am Yes . Relationship with Cayman? Sure . I am not quite certain what relevance this has? Well, when we started the factory, or the company in 12 America, a man called John Grace was the man we 13 appointed to run it. 14 168 Q 15 A Yes? And we transferred money from England, from 16 Super Ser UK because they had more money in their 17 account than we had, to start this American company. 18 Although I was never in Cayman I understood that 19 this bank, that was looking after us was in Cayman. 20 169 Q 21 A Yes? But may I say that -- I mean in those days Cayman 22 was just a name of another bank. 23 sort of ramifications that it has today. 24 170 Q Mr. Lindsay, would you look at another document? 25 (Same Handed) 26 document is to you. 27 know who Mr. Furze is? 28 29 A It didn't have the (Exhibit 4). I will explain what this This is from Mr. Furze. Do you 1 2 172 Q. He is, in fact, a Managing Director, one of the 3 Managing Directors of the Guinness Mahon Cayman 4 Trust Company in Cayman? 5 A. 6 173 Q. 7 A. 8 174 Q. 9 A. 10 175 Q. 11 A. 12 176 Q. 13 Yes, I knew he was associated with Des Traynor. Yes. That is from Mr. Furze? Right. And...(INTERJECTION)? Alan Lindsay, that is it. Yes? That is what I was talking about, I am sure. This is a transfer of £270,000: "Should be grateful if you would arrange the transfer of Stg£270,000 t o ..." 14 15 16 Barcelona? 17 A. 18 177 Q. 19 A. 20 178 Q. 21 22 A. 17 9 Q. This is from The Irish Intercontinental Bank Well, now, I never had anything to do with You may not have known it but the account which you could draw on? 26 A. 27 180 Q. 29 Yes. Intercontinental Bank. 25 28 This is the account of an Alan Lindsay? Limited? 23 24 Yes. Yes. Was at that time -- it had been moved to The Irish Intercontinental Bank? 1 181 Q 2 is that right? 3 A 4 182 Q 5 Yes . This was paid out of the account of Guinness Mahon Cayman Trust in IIB? 6 A 7 183 Q 8 A 9 184 Q 10 A 11 185 Q 12 A 13 186 Q 14 A 15 187 Q 16 17 This is the sum of money that you paid to your son, Yes . You see the debit? Yes . Is that correct? Yes. Is it of any interest where I got that money? Sorry? Is it of any interest where I got that money? If you want to tell me, yes? I know you want to stick directly on the point. Yes. I want to stick to your personal...(INTERJECTION)? A Yes. First of all the business, the heater 18 business, in the United States blossomed. 19 tremendously and then suddenly all the gas 20 suppliers, all the Seven Sisters as they call 21 themselves, stopped the supply of gas for portable 22 gas heaters because it says -- in the States the 23 legal position was that people would start wheeling 24 them up against curtains and so forth and it was too 25 liable for claims and they had ordered that the 26 supply of gas for heaters to be stopped. 27 day our business was stopped. 28 Yes? 29 Then after that I had to do something and I got a 28 It went So, in one 1 2 I am sorry. 3 because I just am concerned to obtain evidence from 4 you about your relationship with Guinness Mahon 5 Cayman Trust Limited? 6 A 7 190 Q 8 A 9 191 Q 10 A 11 192 Q 12 A 13 193 Q 14 A 15 194 Q I am going to stop you Mr. Lindsay Yes . It looks as if you had £270,000? £270,000, yes. There? Yes . Which was transferred to your son? And that was after I had paid for three children. Yes? For four years. Yes. However, what I am suggesting to you, perhaps 16 you could comment on it Mr. Lindsay, is that it is 17 extremely unlikely that a sum of that magnitude 18 would not be earning interest? 19 A I never got any documents. 20 paper. 21 Des Traynor. 22 195 Q 23 A 24 196 Q I never got a sheet of It was absolutely trust and I trusted I am sure of that? And I would trust him again. I am sure of that. However, Mr. Lindsay what I am 25 suggesting to you is that it is extremely unlikely 26 that that sum, which was on deposit in the 27 Cayman Islands, did not earn interest? 28 I have absolutely -- I never got any indication that 29 it was. He was doing me a favour. 1 197 Q 2 What did you think? What did you think? What is your thought now about this? 3 A 4 198 Q 5 A Well, I am wiser now than I...(INTERJECTION). What do you think now? Well, if I had a ton of money to invest now I would 6 want interest on it but in those days he was doing 7 me a favour. 8 199 Q 9 Yes. If you would just have a look at another letter there (Exhibit 5 ) (Same Handed)? 10 A 11 200 Q Yes . It is the 1992 letter and it is to Mr. Redmond in 12 The Irish Intercontinental Bank. 13 "Ansbacher" here in Dublin, 42 Fitzwilliam Square. 14 It is a letter to him stating: 15 It is from "Could you please arrange to let me have for collection a U.S. Dollar cheque for US$2,315.00 payable to Ralph Lindsay and debit the Sterling cost to "Ansbacher"..." 16 17 18 That is your son Ralph? 19 20 A 21 201 Q 22 23 A 202 Q Yes, yes. However, you have control of it and you are directing that that sum be paid to you son? A 28 29 Well, obviously it is from the same account in the Cayman. 26 27 This is in 1992 and you are drawing from the "Ansbacher" account in IIB in this sum of $2,315? 24 25 Yes, that is one that was in college in America. Yes. All I ever had to do was just ring Mr. Traynor and tell him that I wanted this money. 203 Q Yes? 1 Its seem quite incredible now but I mean he would 2 even say, "What do you want it for?" you know. 3 204 Q 4 Yes. Did you do this frequently? Did you ask him for money frequently? 5 A 6 205 Q 7 A No, infrequently. Infrequently? As a matter of fact that sum that I sent, that I got 8 sent, to him when I was working in Bangladesh. 9 was working for an American firm in Bangladesh 10 I otherwise I wouldn't have got that money. 11 206 Q 12 A Yes ? But as a matter of fact, you know, I certainly don't 13 remember that but I mean it is quite possible that 14 he wanted $2,000 for something or another. 15 207 Q 16 I want you to refer to one other document now, Mr. Lindsay (Exhibit 6 ) (Same Handed)? 17 A 18 208 Q Yes . You see that this again a ledger account of 19 Guinness & Mahon Limited. 20 left-hand side, that it is an account "Amiens 21 Limited." 22 "J.H. Lindsay - £1,000 debit"? 23 A 24 209 Q 25 A 26 210 Q Do you see, on the Then on the 31st October 1986 Sorry, what is Amiens? I will tell you now in a moment? Yes . What I want to suggest to you is that from 27 Amiens Limited it would appear that £1,000 was paid 28 to you in 1986? 29 A 1 211 Q Yes. I will come to that in a moment. However, do 2 you recall receiving a payment yourself of £1,000, 3 organised by Mr. 4 A 5 212 Q 6 Traynor? I don't. You could have though? I mean it is a long time ago? 7 A 8 213 Q 9 A 10 214 Q 11 I could have. You could have? Yes . What Amiens Limited was, Mr. Lindsay, was an account which Des Traynor, Mr. Desmond Traynor, operated? 12 A 13 215 Q Yes . He used this account by transfering from 14 "Ansbacher's" account in Guinness & Mahon into 15 Amiens and paying clients of "Ansbacher" out of the 16 Amiens. 17 A 18 216 Q 19 20 That is why I am asking you about this? Yes . This was a payment to you. This would appear to be a payment to you organised by Mr. Traynor of £1,000? A 21 If it is there it must have happened but I can't...(INTERJECTION). 22 217 Q 23 A You cannot remember? I mean £1,000, it wouldn't be the sort of sum that I 24 would be going to Des Traynor really looking for, 25 you know. 26 218 Q 27 A 28 29 Yes? Unless it was like in America where if I wanted monies sent to Ralph or to my daughter and that. 219 Q You would have obtained it? 1 2 220 Q. 3 A. 4 221 Q. 5 Yes . Mr. Lindsay, what we have been doing is breaking for a short time for a coffee break? 6 A. 7 222 Q. Yes . What I would suggest is that we break for about ten 8 minutes now and you can have a cup of coffee if you 9 would like it? 10 A. 11 223 Q. 12 13 Thank you. We have not got very much more to ask you. However, if we could come back in ten minutes. A. Yes . 14 SHORT ADJOURNMENT 15 16 17 224 Q. MR. JUSTICE COSTELLO: 18 Mr. Lindsay, we will resume our interview now. 19 I understand, Mr. Hayes, that you would like to 20 clarify something with us? 21 MR. HAYES: Indeed if I may Inspector? 22 MR. JUSTICE COSTELLO: Yes, yes. 23 MR. HAYES: Well, it is entirely our 24 fault because we have not 25 given you a written statement as we should have. 26 MR. JUSTICE COSTELLO: Yes. 27 MR. HAYES: We will rectify that. 28 MR. JUSTICE COSTELLO: Yes. 29 1 recently on that aspect. 2 MR. JUSTICE COSTELLO: Yes. 3 MR. HAYES: However, from hearing 4 these questions -- I mean 5 I think there is one aspect that does need to be 6 clarified. 7 MR. JUSTICE COSTELLO: Yes. 8 MR. HAYES: And it is this. 9 MR. JUSTICE COSTELLO: Yes. MR. HAYES: That, and I am authorized 10 11 by Mr. Lindsay to say 12 this, from the very start of his involvement with 13 Mr. Traynor and "Ansbacher" -- sorry, Guinness & 14 Mahon which became "Ansbacher" and so forth, that 15 was entirely a business affair, if I might put it as 16 such. 17 MR. JUSTICE COSTELLO: Yes. 18 MR. HAYES: Up to the time when the 19 business ceased and 20 Mr. Lindsay moved to Bangladesh. 21 MR. JUSTICE COSTELLO: Yes. 22 MR. HAYES: Unfortunately, 23 Mr. Lindsay's grasp of 24 dates is -- we will have to check records and try 25 and get the exact dates but all of the dealings with 26 Mr. Traynor were to do with his companies, which 27 were Super Ser...(INTERJECTION) 28 29 1 2 MR. JUSTICE COSTELLO: However, we have put certain documents to 3 4 Mr. Lindsay which gives certain dates. 5 MR. HAYES: Yes. 6 MR. JUSTICE COSTELLO: I do not think it would be appropriate for you to be 7 8 giving us evidence that your client may have told 9 you about. We have to go on the evidence that the 10 witness gives us. 11 MR. HAYES: Yes. 12 MR. JUSTICE COSTELLO: And if he cannot remember we take that into account. 13 14 MR. HAYES: Yes. 15 MR. JUSTICE COSTELLO: However, it would help us if you could get a 16 17 detailed statement, if he could prepare a detailed 18 statement. 19 MR. HAYES: Yes, we will do that. 20 MR. JUSTICE COSTELLO: Yes. Also it would help us if he would get the 21 22 documents from his accountants because we would 23 require all the documents that the accountants have. 24 MR. HAYES: 26 myself. 27 MR. JUSTICE COSTELLO: 29 As I say I only came into this fairly recently 25 28 Yes. I will attend to that. Yes. 1 2 MR. JUSTICE COSTELLO: 3 MR. HAYES: I do not want to give 4 evidence or anything like 5 that. 6 MR. JUSTICE COSTELLO: Yes. 7 MR. HAYES: And the statement will 8 9 make it clear that his dealings with the bank were of -- I mean I have seen 10 the documents and I have seen reference to him 11 personally and, of course, but there does seem to be 12 a confusion about that. 13 to him it should really have referred 14 to...(INTERJECTION). 15 MR. JUSTICE COSTELLO: 16 That is what you say. However, we have to decide 17 that. 18 MR. HAYES: Obviously, yes. I just 19 20 It is that when it refers wanted to make that point. MR. JUSTICE COSTELLO: 21 Yes, I know. However, we have the evidence that he 22 personally had money, that he gave money to 23 Mr. Traynor. 24 in 1986. 25 actual dates may or may not be significant, we have 26 to wait. 27 at some point in time he had a personal account in 28 the Cayman Islands? 29 He says he thought that it was It would seem to be earlier. However, the However, what is absolutely clear is that 1 2 MR. JUSTICE COSTELLO: Yes. 3 MR. HAYES: You see in the statement 4 we will make it clear, 5 that in relation to this American business, that he 6 has sort of explained to you, an account was needed 7 to service that business. 8 Mr. Lindsay by Mr. Traynor that they would open that 9 account in the Cayman Islands and that that is how It was said to 10 the account came to be opened for that. 11 this is a point which has not been conveyed because 12 we have not given a statement. 13 MR. JUSTICE COSTELLO: 14 I think Mr. Hayes, I know that you are trying to clarify the 15 situation. 16 MR. HAYES: Yes. 17 MR. JUSTICE COSTELLO: However, we have to go on 18 the evidence that the 19 witness gives us. 20 MR. HAYES: Yes. 21 MR. JUSTICE COSTELLO: At the moment I understand 22 that there was a 23 considerable amount of dealing with the company. 24 have heard evidence that there was £400,000 lodged 25 by the company in the Cayman Islands. 26 MR. HAYES: Yes. 27 MR. JUSTICE COSTELLO: What we are concerned with 28 29 We today is Mr. Lindsay's own personal dealings with the company. At the moment 1 the evidence establishes that he had personal 2 dealings and that is what I am concerned with today. 3 MR. HAYES: 4 If I could just make one final point? 5 MR. JUSTICE COSTELLO: Yes. 6 MR. HAYES: When the company ceased to trade, at that point, 7 8 unfortunately I cannot remember the year, 9 Mr. Lindsay went to Bangladesh. 10 MR. JUSTICE COSTELLO: Yes. 11 MR. HAYES: And it was at that point 12 that he will say, in this 13 statement, that the personal dealings commenced 14 between himself and...(INTERJECTION). 15 MR. JUSTICE COSTELLO: He has said that already. 16 MR. HAYES: Yes. 17 Then for five years he was resident in 18 Bangladesh. 19 MR. JUSTICE COSTELLO: Yes . 20 MR. HAYES: And as he has explained remitting the monies, 21 22 which he earned there to Mr. Traynor. 23 MR. JUSTICE COSTELLO: Yes . 24 MR. HAYES: I thought that that needed clarity. 25 26 MR. JUSTICE COSTELLO: 29 You can get the matter clarified. 27 28 Yes, very well. MR. HAYES: Yes . 1 2 3 4 Yes . 226 Q 5 transferred to your son in Barcelona? 6 A 7 227 Q 8 A 9 228 Q 10 A 11 229 Q 12 A 13 230 Q 14 A 15 231 Q 16 17 When the money, that I have referred to, was Yes . Did that close the account in Cayman? Yes . You had no further dealings with it? No, further at all, no. There was a substantial sum of money in the account? Yes . At that stage? Yes . Had you deposited money in the account from time to time? A 18 Continuously I would think, almost shipment by shipment. 19 232 Q 20 A 21 233 Q 22 A 23 234 Q In your own personal account? Yes . I am talking about? Shipment by shipment of carpets from Bangladesh. In your own personal account, the money you gave to 24 Mr. Traynor and Mr. Traynor put it into the Cayman 25 account? 26 A 27 235 Q 28 A 29 236 Q Yes . That lasted for some years? Yes . 2 237 Q 3 What I wish to know is, did you thereafter deposit money? 4 A 5 238 Q 6 A 7 239 Q From a source in Bangladesh? 8 A From earnings in Bangladesh. 9 240 Q 10 A 11 241 Q 12 13 A Yes . In Bangladesh? Yes . You will tell us the date on which that occurred? Yes, I will. A date as regards from what year to what year and so forth. 15 242 Q 16 A 17 243 Q 18 A 19 244 Q 20 A 21 Approximately what are we talking about? Em...(INTERJECTION). Are we talking about...(INTERJECTION)? Five years about. However, in the 1980s or 1970s? No, no, I wasn't in -- it would have been in the 1980s. 245 Q 23 24 All the money that was in the Cayman came from a? You will find this out from your records? 14 22 No, not a penny. In the 1980s. Perhaps, I might get it this way: You set up Super Ser? A 25 Yes. Incidently that was the name of the Spanish company. 26 246 Q 27 A 28 247 Q 29 A Yes. Super Ser Limited? Yes . It was incorporated in Ireland? 1 248 Q. 2 was Mr. Goosen? 3 A. 4 249 Q. 5 A. 6 250 Q. 7 A. 8 251 Q. 9 A. 10 252 Q. 11 12 Your partner in that, a 50% shareholder, with you Yes. When did that company cease to carry on trade? 1982/1983, was it? Early 1980s you think? Yes. Was it then that you went to Bangladesh? Yes. When you returned after five years what business activity did you undertake then? A. Well, you see all the time in the background, from 13 my grandfather's time, we had a motorcycle shop 14 in Ship Street. 15 253 Q. 16 A. 17 254 Q. 19 A. 20 255 Q. 21 A. 22 256 Q. 23 A. 24 257 Q. 25 A. 29 Yes? And I had a man looking after that while I was away. When you can back what did you do? When I came back I went back into that. Yes? That is it and then it packed up. What did you do then? Then I retired. I mean that was -- I was getting on then. 26 28 And all the time that was ticking over but I mean it made virtually no money. 18 27 Yes? 258 Q. When did Ardant Limited establish and your factory establish making these heaters? 1 2 259 Q. 3 A. 4 5 How long did that company operate for? Well, the main operation of that company quickly became the America operation. 260 Q. 6 Was there a separate company established in the United States? 7 A. 8 2 61 Q. Do you remember the name of that company? 9 A. I know the heaters were called Shamrocks. 10 Yes. it was called Ardant. 11 2 62 Q. 12 A. 13 Would your accountants know? Maybe, maybe. Certainly the man who was our manager, the man who looked after it, he would know. 14 2 63 Q. 15 A. John Grace. 16 264 Q. John Grace? 17 A. What was his name? A further complication there. 18 English. 19 believe is Quan Gracias. 20 265 Q. 21 A. 22 266 Q. 23 A. 24 267 Q. 26 A. 27 268 Q. 29 He spoke perfect He came from Gibralter. His real name I Yes? But everybody called him John Grace. Where is he now? Where is Mr. Grace now? Well, I haven't spoken to him for a few years but he lived in Norfolk, Virginia. 25 28 Possibly In Virginia? Yes. Very well then. If you would like to consider what 1 269 Q 2 And you could make a further statement then and obtain all the documents that you can from them? 3 A 4 270 Q Yes . It is not a question of getting a selection of 5 documents, it is all the documents, that your 6 solicitors might have in relation to your own 7 personal...(INTERJECTION)? 8 A 9 271 Q Yes . There is one final matter that I want to ask you 10 about. 11 tell us, ceased to carry on business? 12 A 13 272 Q 14 It does appear that Super Ser, from what you Yes . There are very substantial sums of money that Super Ser apparently had on deposit? 15 A 16 273 Q 17 A 18 274 Q 19 A Yes . $400,000 according to this document? Yes . What became of the funds? It disappeared like that in so much as when -- we 20 had endless orders. 21 American television with, you know, people talking 22 about the...(INTERJECTION). 23 275 Q 24 We took a half an hour on I am not talking about the American company. talking about the Irish company? 25 A 26 276 Q 27 A 28 277 Q 29 A Yes . That had very substantial sums on deposits? Yes . Of $400,000 in "Ansbacher"? I am 1 278 Q. 2 A. 3 279 Q. 4 A. 5 280 Q. 6 A. 7 281 Q. 8 A. 9 282 Q. 10 A. In Cayman? Yes. And substantial sums in London and in New York? Yes. Or in America? Yes. What became of the funds? Yes, just -- may I just sort to get to that? Yes? We had the orders. So, we got big loans from 11 Guinness & Mahon to service this American market. 12 We got big loans and then suddenly it was stopped 13 like that. 14 took everything. 15 283 Q. 16 It just stopped and Guinness & Mahon They just took it like that. Then it was Super Ser that you say were servicing the American market? 17 A. 18 284 Q. 19 A. 20 285 Q. The Irish company here? Yes -- no, no, the money came from England. Yes? Because they had the majority of the money. You are going to tell us when Super Ser ceased 21 trading? 22 we have that Super Ser was a client of "Ansbacher" 23 and we would have to investigate Super Ser? 24 A. 25 286 Q. However, it does appear from the records Yes. Apart from you is there anybody else that can assist 26 us in relation to Super Ser and its accounts and its 27 dealings with "Ansbacher"? 28 29 A. I don't even know -- I mean I am surprised when I saw that there. I think that our (inaudible) with 1 Guinness & Mahon more or less coincided -- I 2 remember Mr. Traynor told me one day, he said, "I 3 have sold a bank in Cayman to a South African 4 company" which I haven't heard mentioned since. 5 287 Q. 6 A. And that, I think, was one of your last meetings. 7 288 Q. No. I am asking you about Super Ser, Mr. Lindsay. 8 What about Mr. Goosen? 9 A. 10 289 Q. 11 A. 12 13 Yes? Where is he? He lives in England. Yes? He and I had a big disagreement about it. He didn't want to go to America and events proved him right. 290 Q. Is there anybody else that can help us about the 14 Super Ser company apart from yourself? 15 accountants? 16 A. 17 291 Q. 18 Did you have Did Haughey Boland look after you? Yes. Would you ask your accountants for any records that they have in relation to Super Ser? 19 A. 20 292 Q. 21 Yes. And in particular in relation to the deposits that Super Ser had in the Cayman Islands? 22 A. Yes, certainly. 23 293 Q. Very well then? 24 A. 25 294 Q. 26 A. May I add? Yes? It seems an incredible naive approach to things now 27 but I was trained as a fitter and turner and for me 28 to make something that people in America would buy 29 in colossal numbers was a dream. 1 295 Q 2 A And when it just shut down like that and 3 Guinness & Mahon took all the money I didn't even 4 want to bloody know whether we owed them money or 5 whether they owed us money. 6 296 Q Yes. Very well. Thank you for your assistance 7 Mr. Lindsay. 8 then in the light of the documents? 9 A 10 297 Q 11 A 12 298 Q Thank you. 13 A Thank you. 14 We can look at the situation again Yes . That you sent on to us? Yes. All right. MR. HAYES: Thank you. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED. UNDER OATH ON FRIDAY, 24TH MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer Aha/?17; Mum at 3?qu AppendiXXV?ngHb) L«l G +M GUINNESS+M AHON LTD nCabt«a»MDwMnZ r.O.MnHAT^tl.m.W«H4 cuiHNCss mahoh caynan must ltd OS P O SIT FKON S U M 10 :• JT A T M W T MO. STERLING F/C CALL 0/A • FAG l M . ■. . LEDGER ojmto* . -- • r llo F E iijlr e x aov ' : .Y S 5 - jmiirT issueo jm um o sav «NHMwlM *Uf- ItOM.Zt ' • - r . ... i . ' r - f ■ ■T1 ■#5 .?r KUK1. . •£ - Appendix iru m iK U IU IK U Bo/Mtnd Trust Company Umlted PA Bo*887 International st G r o u p GrandCayman o w n fT ttt r a t s TllaptoM8099498655 t3kCP43QS FittMa 8099495267 T e le fa x Prom: John A. Furze, Esq. Ref no. To: Irish Intercontinental Bank, Dublin Ireland Attention: Ronan reemond, esq. Fox No: 011-3531-6785-034 Dale: 31-03-94 No. of Paces (inducingHi one}: ttis P0®8 S h o u ld b e g n te A ii i f y o n w o u ld a m n g e d ie tra n s fe r c f S tg . £270y000 to : F i n do < \cro 20 00002: %Mdn A ccount N o: I0.14m2^< A c c o u n t N am e: a l a n u n d sa y N < ^ f C F le a m dcMt the stezfisga m to oar aoooattamber W n vlnonafiflffloBaioQBaidBtiMbthMdlCc^ * I m r l f t s -") > o » / i S € yfo0ArZA fl«^ z-«T >‘A 13a3£5rn n 5& S ob J . D . '& i p o r r ro u HAVE HOT MCSVB IMS TOTAL NUMHR OF WOES OR * YOU NB0 AS88MNCE H IM 0M1 (M] MfrtMB . . ________ ____ ____ o o w r a m m f H o n a n * I n M a manga anttr I* teunanb aeanamfaa t m m to r i M mt nttartW ni aw*d H m SHbu* w*r appUfclM. ItwmdirliartlwHinMi^^rilar^anftof^vigwirMFign^MHsrSX'^llaNHMMNcpari.aRr •w.lhawhwuOWriWiriiitrM ^hom wUKqW MiM ^mnmMilMtiiliwdwrecylwtoiB*— i»ycAttinfc yw. . Z GmrtiM y,M entto.9wfe«tanllal»«IM«n, Bahamas, Cayman Mand^ Bitiah Virgin Man* O l O C f Z Appendix Please reply to: 42 FltzwOliani Square, Dublin 2. P.O. Box 117 , Grand Cayman, Cayman Island*, British West Indies Telephone: (109) 949-8655 Telex: CP <305 Facsimile <*09)949-7946 (109) 949-5267 Tel: 765144/763063 Fax: 612035 13 t h O cto b e r, 19 9 2 . R o n a n Redm ond, E a q . , C o rp o ra te S e r v ic e s , « I r i s h In t e r c o n t in e n t a l Bank L im it e d , 9 1 M e r r io n S q u a r e , DflBfriP ?• . D ear Ronan, C o u ld y o u p l e a s e a r r a n g e t o l e t me h a v e f o r c o l l e c t i o n a U . S . D o l l a r c h e q u e f o r U S S 2 , ? 1 5 . 0 0 p a y a b le t o R a lp h L i n d s a y a n d d e b i t t h e S t e r l i n g c o s t t o A n s b a c h e r L i m it e d A c c o u n t N o.0 2 /0 10 8 7 /8 1. ' Y o u rs s in c e r e ly , F o r ANSBACHER L IM IT E D . Ad bSHsas. a N CM ia o r n o a n * ia ch » ‘ AUOLOCaTXDIKTM6lAMAMAl VIIUHX181AKDS» GUTILVm. MONACOAKDIWmXIUAKD wm o m c B ^ U > Appe?dix xvt??iaua) 7 GORE & GRIMES I ' W i \ l Ms 11 H< >1 Si i' ; 1 . ■ > . ' -i :'i-( \ \ -■: I M.iii. ■■>1' i ■.' KH\AB L00296.17 P R IV A TE A N D C O N F ID E N TIA L The Inspectors, Third Floor, Trident House, Blackrock, Co. Dublin R E: sY 11llll ! I 1 I li Ivi ! I \ ' ’ 'is : i •) -'1-1 v ' 15 ^ ii i \ "; C/L04/NSPM «■> 3 December, 2001 H A R R Y LIN D S A Y A N D S U P ER S ER LIM ITED Dear Sirs, With reference to your letter of the 7th November, our Client was never informed by the Post Office that these letters from you were available for his collection. With reference to your “Preliminary Conclusions", Mr. Lindsay did acknowledge in the course of his examination before the Inspectors that he was indeed a Client of Ansbacher and, as a Director of Super Ser Limited, that that Company also was a Client of Ansbacher. He would however like to make the point that at that time, there was no suggestion of any impropriety in being a customer of that Bank. It is only in recent years that evidence has emerged in the public domain which, as you put it in your letter, “justifies findings and/or inferences that you may consider to be adverse to your interests, good name and/or reputation". Our Client was introduced to this Institution, in the manner he has described in his evidence to you, by Mr. Traynor, and was not aware of anything at all improper in his conducting the business that he did conduct at that time with Mr. Traynor. A ppendix XV (67) M r Joseph C layton L ove Junior 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Joseph Clayton Love Junior. a) Transcript o f evidence o f Mr Clayton Love Jnr dated 8 March 2000. b) Statement o f Mr Clayton Love Jnr dated March 2000. c) Supplemental statement o f Mr Clayton Love Jnr o f 24 May 2000. d) Elizabeth Love trust deed dated 23 April 1971. e) Letter o f 7 December 2001 - JW O’Donovan Solicitors to the Inspectors. f) Transcript o f submissions made on behalf o f Mr Love dated 20 March 2002. UNDER OATH ON WEDNESDAY, 8TH MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer THE INSPECTORS: MR. JUSTICE COSTELLO MS. MACKEY BL SOLICITOR TO THE INSPECTORS: MS. M. CUMMINS INTERVIEWEE: MR. CLAYTON LOVE JNR. INSTRUCTED BY: MR. CORMAC O'HANLON J .W . O' DONOVAN 53 SOUTH MALL CORK 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Love, we will start our interview. I am 6 Declan Costello and on my right is Ms. Mackey. 7 are the Inspectors who have been appointed which by 8 the High Court. 9 not a Court, it is not a Tribunal, it is an We I should perhaps explain this is 10 interview. 11 questions that we ask you that you would like to 12 take advice on, please let me know and you are at 13 liberty to ask your solicitor for advice. 14 Similarly, if your solicitor feels that there is any 15 question that he would like to discuss with you 16 before you answer, you are at liberty to discuss the 17 matter with your solicitor and we will adjourn to 18 allow you do so. 19 20 A. If you have any problems about any Okay. MR. JUSTICE COSTELLO: 21 22 23 24 25 26 27 28 29 I will now ask our solicitor to administer the oath to you. 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Love, yesterday we received your statement. 6 We received no documents, although it was indicated 7 to us that perhaps you would be sending us 8 documents. 9 A. Judge, we are in the process of trying to get as 10 much information as we can from the Cayman to put 11 the document together. 12 answer that, can he? 13 2 Q. Maybe Cormac would best Strictly speaking no, we can go into it later. I 14 have to explain to you that it does appear as of 15 now, at any rate, that we may have to call you back 16 again, Mr. Love. 17 A. 18 3 Q. That is okay. You understand that. We only received your 19 statement yesterday, we have no documents in 20 relation to it, so it may well be necessary, first 21 of all, in relation to the documents that you may 22 furnish to us and secondly, in relation to the 23 documents that we may ask you for that a further 24 interview takes place. 25 A. 26 4 Q. Okay. Mr. Love, I want to begin by referring you to our 27 main long letter we sent to you and to the 28 information which we sought in it. 29 of 21st December 1999. It is a letter Do you have it there 1 2 3 5 Q. 4 A. 5 6 Q. 6 7 8 9 10 11 Would you look at Appendix C of that letter? Yes. Do you see we ask for: "... a full and detailed statement of all the dealings which the Company had with you, whether directly or indirectly. This should include details of the manner in which services were supplied by the Company, the dates on which they were supplied, the names of the person or persons who acted on behalf of the Company in supplying them and the names of your professional advisers who may have advised you concerning the supply of the services. 12 13 Without prejudice to the generality of the foregoing, the statement should deal with the following matters...." 14 15 And we set them out. 16 17 Mr. Love, I have to draw your attention to the fact 18 that the matters on which we sought your assistance 19 are not included in your statement and I propose to 20 go through this letter now to ask you for further 21 assistance and to ask you for the documents which we 22 consider to be necessary. 23 page to the Cayman Island Trust and Trust companies? 24 It reads: Would you turn over the 25 26 27 28 29 "If you caused to be executed a deed of trust or other instrument in the Cayman Islands or elsewhere whereby the Company or some other person associated with it or acting at its discretion was a trustee or managed th trust and you transferred money or other assets to the trust and/or if you caused to be established 1 in the Cayman Islands a body corporate to which you caused to be assigned money or other assets and which were managed by the Company or some other person associated with it or acting at its direction, you should - 2 3 4 (a) Furnish all correspondence relating to the establishment of the Trust." 5 6 Mr. Love, would you tell me first of all what trusts 7 you established or caused to be established in the 8 Cayman Islands? 9 A. The trust that was established in the Cayman Islands 10 was the Elizabeth Love Trust. 11 in my statement. 12 is Yale. 13 I have had difficulty getting information from the 14 Cayman but recently I asked my son to go out to the 15 Cayman and I spoke there to a Brian Bothwell before 16 he left and they have promised to give us 17 information arising out of that. 18 7 Q. 19 A. 21 8 Q. 22 A. 23 9 Q. 29 What was the date when it was established? The trust was established in the early 1970's, if my Can you not be a bit more specific? No, I cannot. I don't have any information on it Mr. Love, you must have had professional advice, did you not? A. 27 28 I do not have a copy of the Trust Deed. myself. 25 26 The company associated with that recollection is correct. 20 24 That is referred to Yes, I took the advice of both Des Traynor at the time and Michael McMahon in Haughey Boland. 10 Q. I just want to get this clear. Your firm or your 1 you have your own personal accountants looking after 2 your tax affairs? 3 Michael McMahon of Haughey Boland. 4 Was he separate from the accountants 5 ....(INTERJECTION) 6 A 7 12 Q 8 A 9 10 13 Q A I know that, and he was also on the Board of your The family company had nothing to do with this, Judge. 14 Q I understand that, yes. Did Mr. McMahon advise you about discretionary trusts? 15 16 But remember Des Traynor was a partner in family company? 13 14 That were dealing with your company. Haughey Boland before he left. 11 12 From Des Traynor, yes, he was. A The intention to set up a discretionary trust was 17 that obviously, being in the property business, one 18 has to realise it is a cyclical business and the 19 whole idea of the discretionary trust was to try and 20 establish some fund in which at least at that time I 21 was only a potential, if you will, beneficiary from 22 the trust and a borrower from it. 23 15 Q Just listen to the question, we will go into that 24 later. 25 this company? 26 A Did you obtain advice on the setting up of Whether the trust was proposed to me by 27 Desmond Traynor, I would have discussed it, 28 obviously, with Michael McMahon. 29 1 Michael McMahon advise you fully in relation to it? 2 A. 3 17 Q. 4 A. 5 18 Q. 6 A. 7 19 Q. 8 A. 9 20 Q. 10 He said it was perfectly legal. Did he advise you, he did? In what respect? Did he write to you? Michael McMahon was not a very good writer. Did he write to you, then? No, he didn't, not that I can recollect. You would have talked to him then about the legality of the trust? 11 A. 12 21 Q. 13 A. 14 Yes, I would. Did you have a solicitor at the time? I would have had a solicitor at the time but I wouldn't have talked to him about tax matters. 15 22 Q. 16 A. 17 23 Q. 18 A. 19 24 Q. 20 Who was the solicitor, then? Charlie Hennessy of James W. O'Donovan, Cork. So you did not discuss it with your solicitor? No. That means that the legal documents establishing the trust were not drawn up by your solicitor? 21 A. 22 25 Q. 23 A. 24 2 6 Q. 25 A. No, they were not. Who drew them up? I presume they were drawn up in the Caymans. Why do you presume that? Des Traynor handled all of these affairs for me and 26 I had absolute faith in him, to be honest with you. 27 He organised all that for me, or for my wife, 28 rather, and the family. 29 for the Channel Island Trust. The same would have applied 1 27 Q. 2 have signed a document? 3 A. 4 28 Q. 5 A. 6 29 Q. 7 We haven't got that in our possession. Just take it in stages. No, I appreciate what you are saying. My question is did your wife or yourself sign a document? 8 A. 9 30 Q. 10 A. 11 12 You must have signed a document, or your wife must I did not sign a document. Did your wife? I don't think she did. She says she has no recollection of it. 31 Q. That means there has been no Trust Deed signed, then? 13 14 A. 15 32 Q. 16 I don't know, Judge. I wish I did know. Could it have been that somebody else signed the Trust Deed? 17 A. 18 33 Q. It is possible but I don't know. When you say it is possible, I am sure you have 19 heard all the evidence that has been in the public 20 domain about nominee accountants being appointed to 21 execute these documents. 22 A. 23 24 Were you told that? It is possible that Des Traynor might have done it on my behalf but I don't know, Judge. 34 Q. Were you told that one of the ways of dealing with 25 this situation of establishing trusts would be to 26 have the Trust Deed executed by, say, an accountant? 27 A. 28 35 Q. 29 I think I was at the time, yes, I think I was. So if neither your wife or you signed a document and a Trust Deed was executed, it would appear as if it 1 2 I imagine so, Judge, yes. 3 36 Q 4 A 5 37 Q 6 A 7 38 Q Why was that, do you think? Because of the advice of Des Traynor. What advice did he give you? To create the trust in the Cayman Islands. The accountant in the Cayman Islands would not have 8 had any money so you had to transfer or your wife 9 had to transfer funds? 10 A 11 12 We transferred money, as I said in my statement, from the Channel Island Trust to the Cayman Islands. 39 Q I just want to come to that in a moment. The 13 situation was that you must have been informed that 14 a trust had been established. 15 the trustees were? 16 A 17 Were you informed who I have no recollection of it at this point in time, Judge. 18 40 Q 19 A 20 41 Q 21 A Yes, but who do you think were the trustees now? Who are the trustees now? Yes . That is something we have asked the bank for, or 22 Clayton has asked the bank for, and they are to come 23 back to us on that. 24 42 Q 25 A 26 43 Q 27 Who do you think are the trustees? I don't know, Judge. It has been 30 years now and you do not know who the trustees are? 28 A 29 44 Q No, I don't, Judge. 1 2 45 Q. 3 A. 4 46 Q. 5 A. 6 47 Q. 7 A. 8 48 Q. 9 In the bank? I presume, but I am not sure. Could it have been the bank itself is trustee? I do not know, Judge. Did you ever see a copy of the trust? No, I never did. Do you know how the trust operated? Were you told how the trust would operate and what the trustees 10 would do? 11 A. 12 49 Q. I don't understand your question. Sorry, I will make it clearer. 13 Yale Securities. 14 about Yale Securities? 15 A. 16 50 Q. 17 A. 18 You told me about Tell me what Mr. Traynor told you That it was part and parcel of the trust. Tell me what he told you. That it was a company within the Cayman Islands as part and parcel of the trust. 19 51 Q. 20 A. 21 52 Q. What does part and parcel mean? It handled the money aspect. It handled the money, yes. Did he tell you that in 22 fact the trustees would own the shares in this 23 company? 24 A. 25 53 Q. 26 A. 27 54 Q. 28 29 I don't recollect, Judge. They would handle the money? Yes. Would that mean that the money would be transferred to them? 1 but I would get annual statements from 2 Desmond Traynor which he would show me and that 3 would be it, really. 4 55 Q 5 A 6 You got statements from Des Traynor? He would just give me a blank statement, like a statement of affairs, but I never kept a copy. 7 56 Q 8 A 9 Was the bank statement ....(INTERJECTION) It wasn't a bank statement, it would have been a statement of affairs. There was only one bank 10 statement that I have in my possession which we will 11 give you a copy of in due course, which is way back 12 in 1970, I think, early 1970's. 13 Guinness Mahon in Cayman. 14 57 Q 15 The statement of affairs that Mr. Traynor gave you, was this on a regular basis? 16 A 17 58 Q 18 Once a year at most. Was this a statement of affairs of the trust or of the company? 19 A 20 59 Q 21 A 22 23 That was from It would be of the company, I believe. Of the company? Yes, which as far as I was concerned was part and parcel of the trust. 60 Q Did he ever give you any other documents about the 24 company, for example, about any of its deposits, any 25 of its funds? 26 A 27 61 Q 28 A 29 No. Only a statement of affairs? Just that, yes. The only other document I have, as I said to you, Judge, is ones early in 1970 which 1 2 62 Q. 3 A. 4 63 Q. 5 A. 6 64 Q. 7 A. 8 9 Where is the bank? In Cayman. Does it show a deposit? It does, yes. It names the bank? It names the bank, it names Yale and it names the trust, I think. 65 Q. 10 So what you have is you have Yale being shown as a depositor in the Guinness Mahon Cayman Trust Bank? 11 A. 12 66 Q. 13 Correct. Is that where the money was deposited during the life of the trust, do you think? 14 A. 15 67 Q. Sorry, Judge? Do you think the money was deposited in the Guinness 16 Mahon Cayman Trust Bank throughout the life of the 17 trust? 18 A. 19 68 Q. Yes. The trustees never sought to invest the money in 20 securities or anything like this, it was always on 21 deposit? 22 A. 23 69 Q. 25 A. 26 70 Q. 27 29 There was one investment made in America in property but it wasn't very successful. 24 28 On deposit, yes. Is that the Lyndon one? The Lyndon one, yes. We will come to that later. Apart from Yale Securities, was there another company? A. Apart from Yale Securities, I think there was 1 Orchard but I can't remember, Judge. 2 statement or included in the statement. 3 71 Q 4 A It is on the What was Orchard? It was part and parcel of the set-up that Des made 5 but then it was disbanded and Yale became the 6 company. 7 72 Q 8 A 9 73 Q 10 Can you not be a bit more explicit? I cannot, Judge. I know that. I mean, it is 30 years ago. Orchard was apparently part of the scheme that Mr. Traynor had put together for you? 11 A 12 74 Q 13 A 14 75 Q 15 Yes . Did you get any statements? No. No, I never received a statement from Orchard. The funds that were paid into this trust, they came, you say, from the Channel Islands; is that right? 16 A 17 76 Q 18 A That's correct. Tell me about that. Guinness Mahon and I were partners in property 19 ventures in the UK and the Clayton Love Trust was 20 set up for that purpose in the Channel Islands. 21 77 Q 22 Just take it more slowly. The money which went into Cayman came from the Channel Island trust? 23 A 24 78 Q 25 A Yes . Just tell me about the establishment of that trust? There was a company set up to do property 26 developments, with myself and Guinness Mahon as 27 partners. 28 79 Q 29 A What was the name of that company? 1 80 Q. 2 A. 3 81 Q. 4 A. 5 82 Q. Where was that incorporated? In the Channel Islands. That was a limited company? Yes. It was a joint venture between you and Guinness Mahon? 6 7 A. 8 83 Q. 9 A. 10 84 Q. 11 A. 12 85 Q. Correct. When was a trust established? At the same time. Was there a Trust Deed executed? Again, I have no recollection of seeing it, judge. Tell me about the arrangement that Mr. Traynor made in relation to it? 13 14 A. 15 8 6 Q. 16 A. The trust was set up in the Channel Islands. Just tell me about what Mr. Traynor advised you? I was advised at the time, I think, that I should 17 set up this trust in the Channel Islands I think for 18 holding the shares in Wildwood, I think, I am not 19 sure or my share of the equity in Wildwood, and that 20 Wildwood would conduct the business of property in 21 the UK. 22 87 Q. 23 A. 24 25 When was that? What year was that? The early 1970's, I think, Judge. Mid 1970's or early 1970's, I would say. 88 Q. It should be possible to be more precise because 26 this was a venture undertaken between you and 27 Guinness Mahon, was it not, a joint venture? 28 A. 29 89 Q. Yes. When did that start? 1 A. 2 3 My recollection is around about 1973 or 1974 but I cannot be dead certain. 90 Q. Yes, it is hard to be accurate but I will require 4 you to be much more accurate, Mr. Love, and make 5 enquiries. 6 company was incorporated. 7 able to get me the Trust Deed, I am sure. 8 or 1974 then, a joint venture was undertaken in 9 London? 10 A. 11 91 Q. 12 You can easily find out from when the For example, you will be In 1973 That's correct, yes, London Properties. Is this the one that is referred to in your statement that went wrong? 13 A. 14 92 Q. Yes. Wildwood Investments was set up and at the same time 15 a Trust Deed was executed by which the trust would 16 hold your share in Wildwood? 17 A. 18 93 Q. 19 A. 20 94 Q. 21 22 A. 95 Q. 29 The Trust Deed must have been prepared by someone I don't know. I don't have a copy of it, as I said I am not asking you about a copy, I am asking you who executed it? A. 27 28 60%. to you. 25 26 What share was that? and signed by someone, do you know? 23 24 That's correct, that is my understanding. I imagine it was dealt with by Guinness Mahon Jersey Trust. 96 Q. As the previous one you have mentioned? 1 97 Q 2 trust? 3 A 4 98 Q 5 A 7 99 Q 8 A 9 And you signed nothing? I certainly have no recollection of signing Did you ever see the Trust Deed? I have no recollection of ever seeing the Trust Deed. 100 Q 11 Do you know what company was employed to draft ....(INTERJECTION) 12 A 13 101 Q 14 I don't know, Judge. There were subsidiaries of Guinness Mahon in the Cayman Islands, were there not? 15 A 16 102 Q 17 A 18 103 Q Guinness Mahon Bank, yes. Were they in existence at the time, do you know? Of? When this was set up, when Wildwood Investments ....(INTERJECTION) 19 20 A 21 104 Q 22 I think so, yes. Sorry, I meant Channel Islands. Were there not subsidiaries established in the Channel Islands? 23 A 24 105 Q 25 It was Guinness Mahon Jersey Trust. Do you think it is likely that Guinness Mahon Jersey Trust were the trustees of this? 26 A 27 106 Q 28 29 I would imagine so. anything, Judge. 6 10 So that a nominee was used as the settlor of the I would imagine so. Had you any correspondence relating to the establishment of this trust? A 1 107 Q 2 A 3 108 Q It would have been with Mr. Traynor, yes. Then the best of your recollection is that this 4 trust was established sometime in 1973/74 and its 5 assets would be your 60% shareholding in Wildwood 6 Investments ? 7 A 8 109 Q 9 10 Yes . The development took place, we understand, and it was financially unsuccessful? A No, the development never took place. We bought the 11 properties, put the site together and had the 12 development ready to go ahead and lost the tenant. 13 110 Q 14 A 15 111 Q 16 A 17 112 Q 18 Two or three years. That gets us to 1976/77? 1977/78 . From this venture, was there £75,000 to £80,000 ....(INTERJECTION) 19 A 20 113 Q 21 A 22 114 Q 23 A 24 115 Q 25 A 26 116 Q 27 A 28 117 Q 29 How long did that take? Yes, there were surplus properties. This was in Wildwood Investments Company Limited? It would have come out of that, yes. To the shareholders? Yes . To the shareholders and then to the trustees? Exactly. This would have been about 1977/78? Yes . That means, Mr. Love, that the payment to your wife's trust would not be until then? 1 A. That is one thing that struck me now, Judge, and I 2 do not know how that occurred if the trust was set 3 up in the early 1970's. 4 118 Q. 5 Yes, exactly. You are wrong, are you not Mr. Love, you must be wrong? 6 A. 7 119 Q. 8 A. 9 120 Q. 10 Well, I can't explain it to you otherwise, Judge. Do you know when Yale Securities was incorporated? No, I don't, Judge. Our investigations indicate that it was established in March 1971? 11 A. 12 121 Q. 13 I would think that would be about right, yes. How did it have funds then if they did not come from your Channel Island trust? 14 A. 15 122 Q. 16 A. 17 123 Q. I don't know, Judge. Aren't you mistaken in your recollection? I will check on it, Judge. The trusts that you have told us about were the ones 18 that your wife established in 1971, you say. 19 you say your wife established them 20 ....(INTERJECTION). 21 A. 22 124 Q. 23 A. 25 125 Q. 26 It would appear as if the name of the settlor was an Yes. What I wonder is can you remember who the beneficiaries of the discretionary trust were? 27 A. 28 12 6 Q. 29 They were established in her name, Judge. accountant in the Cayman Islands. 24 When It would be the family, I presume, my family. Can you remember? 1 2 127 Q 3 A I don't remember. 4 and my children. 5 it too obviously. 6 128 Q 7 A 8 129 Q 9 It was set up for the family. You were a potential beneficiary of it? Yes, I was, and a borrower from it subsequently. Leave that aside for the moment. The beneficiaries wife and your children? 11 A 12 130 Q 13 A 14 131 Q 15 A 16 132 Q 17 Yes, that is my recollection, yes, Judge. Why do you call it your wife's trust? Because Des Traynor advised me to do it in her name. The name of the trust was what? The Elizabeth Love Trust. The beneficiaries of the trust were yourself, your wife and your children? A 19 20 I was a potential beneficiary of of this trust established in 1971 was yourself, your 10 18 My children, I presume, my wife I think I was a beneficiary, yes. It certainly was intended that they would be. 133 Q That is one trust. The other trust that was 21 established was in the Channel Islands, do you 22 remember the name of that? 23 A 24 134 Q 25 A 26 135 Q 27 A 28 136 Q 29 A The Clayton Love Cl Trust. Channel Island Trust? Yes . Who were the beneficiaries in that? I imagine they would have been the same. The same? 1 137 Q. 2 A. Your wife, yourself and your children? I imagine, but it could well be just myself 3 exclusively because as a shareholder that might have 4 been the arrangement. 5 138 Q. It would not have been a discretionary trust if you were the only beneficiary? 6 7 A. 8 139 Q. 9 That is true, that is true. Have you made any effort to try to get a hold of this trust? 10 A. We are making efforts to get hold of it. 11 140 Q. Do you know what efforts are you making? 12 A. 13 Islands. 14 141 Q. 15 A. 16 142 Q. 18 A. 19 143 Q. 20 With Guinness Mahon and their successors, and so far Have you written to them? Yes. Over the time you must have met some of the people from the Channel Islands? 21 A. 22 144 Q. 23 A. 24 145 Q. 25 A. 26 146 Q. 27 29 Who? been unsuccessful. 17 28 I am making contact with the people in the Channel No, I didn't. Did you not? No. There was a Mr. Lipscombe. I knew of him but I never met him. He was one of the persons involved in managing the trust, was he not? A. Yes, as I understand it, yes. Judge, I would like to say the whole of the Channel Islands Wildwood 1 thing was a very bad memory for me. 2 something I put aside and forgot about because I had 3 to extract myself from a very serious position. 4 I am a bit sort of not memorising, 5 it all out of my mind. 6 147 Q. 7 A. 8 148 Q. 9 I am surprised that there are difficulties in Those are two trusts that you told us that you established. 11 others ? 13 149 Q. I actually shut Yes, I agree, Judge. 10 A. Are there any No, no others, Judge. I think you are not correct there because you did 14 tell us in your statement about another trust, 15 Lynbrett? 16 A. 17 18 If This is why it is so important to get the documents. getting the documents. 12 It was Yes, Lynbrett, that was a trust set up between five of us to do with property dealings in North America. 150 Q. Why I am asking you about it is because it does 19 appear that a trust document was in fact drawn up, 20 was it not? 21 A. 22 23 Judge. 151 Q. 24 It does appear that Guinness Mahon Cayman Trust was the trustee named? 25 A. 26 152 Q. 27 A. 28 153 Q. 29 I don't ever recollect seeing one but I might have, Yes, in the Lynbrett Trust, yes. Is that right? I think so, yes, Judge. It does appear that the Lynbrett Trust was to take 1 2 154 Q 3 4 Perhaps you will tell me what you recollect was the arrangement. A We got involved in property deals in Arizona and as 5 I understood the trust took advanced monies to those 6 deals -- no, I am mistaken now. 7 up in the Lynbrett Trust were part of the equity 8 towards these deals and the money was borrowed from 9 AIB in New York and I think the ratio was something The monies we put 10 like 80:20, 20% equity and 80% borrowing if I am 11 correct. 12 Lynbrett Trust because there were another four 13 people involved in that. 14 155 Q 15 A 16 156 Q 17 A 18 157 Q 19 A 20 158 Q 21 I am not sure who else was involved in the You are saying you are not sure. No, I am not sure. Don't you know that Mr. Hugh Coveney was involved? He was definitely, yes. You are sure of him? Very much so. It is in the public domain what Mr. Coveney's role in this was. 22 A 23 159 Q 24 Yes . Mr. Coveney was a close personal friend of yours, I think. 25 A 26 160 Q 27 He was, yes. He was involved in this venture and Guinness Mahon Cayman Trust was the trustee. 28 A 29 161 Q Yes, I think so. I am just pointing this out to you because of the 23 1 statement that you had made in your written 2 statement that Mr. Coveney never had any involvement 3 to your knowledge with the Guinness Mahon Cayman 4 Trust, he had involvement? 5 No, in that context he was, yes, Judge. 6 162 Q 7 A 8 I was not aware of the other context and that is what I am referring you to there. 9 163 Q 10 A 11 164 Q 12 A 13 165 Q 14 15 You were not aware of his other ....(INTERJECTION). You knew Mr. Coveney was involved in this? Absolutely. Because he was one of your partners? Correct. Not otherwise. Did you know that the Lynbrett Trust in fact lodged money here? A 16 Judge, I don't think I said that I wasn't aware that Mr. Coveney was a member of the trust. 17 16 6 Q 18 A 19 167 Q No, no, you did not. I didn't say that. Maybe I am wrong in paraphrasing what you said. Did 20 you know that Lynbrett Trust was in fact entitled to 21 one of these sub-accounts that Guinness Mahon Cayman 22 Trust Limited had in Guinness & Mahon here in 23 Dublin? 24 A No, I wasn't aware of that. 25 Just have a look at this photostat. 26 Guinness Mahon Limited ledger statement. 27 the account is in the name of Guinness Mahon Cayman 28 Trust Limited and it shows credits to Lynbrett of 29 £4,500 and Lynbrett £1,756.67 in May 1986. This is a It shows You know 1 about the pooled accounts which Guinness Mahon 2 Cayman Trust had, you know about this; do you not? 3 Yes, I know about it from the papers. 4 169 Q You know from the papers that there was a pooled 5 account and there were a number of coded 6 sub-accounts ? 7 A 8 170 Q 9 10 Do you know did you know that Lynbrett was one of the sub ....(INTERJECTION). A 11 12 Yes, I do. No, I was not aware of that. This is the first I know of that. 171 Q I want to refer you to a letter in relation to the 13 deposits. 14 a letter of 21st June 1977 and it is addressed to 15 Mr. Furze and signed by Mr. Traynor and headed 16 "Re Yale Securities Limited." I want you to look at this letter, it is It says: 17 "Dear John 18 At the present time we have two hypothecation agreements re M. and M.l. against advances in Dublin for Lily Securities and Taurus Securities. 19 20 21 22 23 24 25 Arising out of discussions it has now been agreed for interest purposes only M. and M.l deposits will be offset against Lily and Taurus but that the funds will be actually hypothecated to GMCT re advances by Guinness & Mahon to Clayton Love Jnr. on two loan accounts one for £25,000, one for £13,000. Would you please let me have new agreements on these lines." 26 27 Can you explain that to me, Mr. Love? 28 Lily and Taurus were companies that I used for 29 property development. 1 172 Q 2 A 3 4 I think Lily had to do with a property in Adelaide Road, I think, I am not too sure. 173 Q 5 Lily Securities Limited, it was registered in Ireland? 6 A 7 174 Q 8 A 9 175 Q 10 A 11 176 Q 12 Yes, and Taurus the same way. These were property companies of yours? Yes . You were the beneficial owner of the company? Yes . It would appear that Guinness & Mahon were lending money to these companies? 13 A 14 177 Q Yes . "For interest purposes only the M. and M.I. deposits will be offset against Lily." 15 16 17 18 What are the M. and M.I. deposits? A 19 The 'M' was the Yale account and I don't know what Ml is . 20 178 Q 21 A 22 179 Q 23 A 24 180 Q It appears it must have been one of your accounts? I don't know, Judge. Do not know what Ml was? No, I don't. Could it have been a way of identifying what we have 25 come to know as blocked accounts when part of an 26 account was being used as security for a loan, that 27 was a portion of the main accounts, or the M account 28 in this case, created and called an Ml account and 29 was used as a blocked account to indicate that that 1 portion of the deposit was used as security for a 2 loan? 3 I don't know, Judge. 4 181 Q 5 Did you have other loans from Guinness & Mahon at this time? 6 A In 1977? 7 182 Q In 1977. 8 A 9 I certainly had loans to Wilton Securities in 1977 from Guinness & Mahon, of that I am pretty certain. 10 I might have had loans to Douglas Developments at 11 the time, I am not sure. 12 183 Q 13 A 14 184 Q You do not know? 15 A No, I don't, no. 16 185 Q 17 Do you know why the account was a coded account? I do not know, Judge. It seemed to be the account of Yale Securities Limited, is that right? 18 A 19 186 Q 20 A 21 187 Q 22 That's right. It seems to have been a coded account? Yes . Your understanding was that it was an account in the Cayman Islands? 23 A 24 188 Q 25 I would definitely understand that, yes, Judge. The funds of Yale Securities Limited were being used then as security for loans made to you? 26 A 27 189 Q That would appear on the letter, yes. I want you to look at some other documents. The 28 first document I want to show you is a letter of 29 2nd October 1991 from Joan Williams to Mr. Logan in 1 2 "Dear Garrett 3 Could you please arrange to lodge the enclosed draft for Stg.£21,250.00 to credit of Ansbacher Limited account, No. 02/01087/81." 4 5 6 The account number is given. 7 Mr. Traynor's secretary and that is arranging to 8 lodge a sterling draft of £21,250 in the Ansbacher 9 main account, is that not right? 10 A 11 190 Q Joan Williams is Yes . The information which we have obtained is that that 12 was a draft purchased by Lyndon Properties and the 13 funds used to purchase the draft were debited to the 14 current account of Lyndon Properties in November 15 1991. 16 (Exhibit 5) the photostat is not very clear but it 17 is clear it is a draft. 18 Lyndon Properties were lodging money into the main 19 account in IIB of Ansbacher? 20 A 21 191 Q 22 A 23 192 Q We will just show you the next document, I cannot, Judge. Can you explain to me how I have never seen this before. They were though. From the evidence, yes. There is a further document, if you look down to a 24 letter from Joan Williams of 17th December 1991 25 (Exhibit 6), Joan Williams is asking Mr. Logan to 26 lodge enclosed draft for £27,750stg. to Ansbacher 27 account. 28 obtained from the Bank of Ireland is that the draft 29 was purchased by Lyndon Properties of 3 Inns Quay, Again the information which we have 1 Dublin. 2 debited from the current account of Lyndon 3 Properties on 16th December 1991, again this is a 4 lodgment to the Ansbacher account. 5 properties is your company? 6 Yes, it is. 7 193 Q 8 A 9 194 Q 10 The funds used to purchase the draft were Lyndon It is 100% owned by you? Yes . Are you not able to explain to me how it came about that ....(INTERJECTION). 11 A 12 195 Q 13 A 14 196 Q I have to go back and check the records. Would you check? Yes, I will of course, two payments. Would you turn to another document of 27th May 1994 15 and this is from Joan Williams to Mr. Redmond in the 16 Irish Intercontinental Bank and it states: 17 "Could you please arrange to lodge the enclosed sterling cheque for Stg. £30,000 to C.I.B.T.C. account..." 18 19 20 It is the same numbered account. 21 account, is it not? 22 on the photostat and it is a C&E Love cheque, that 23 is you and your wife, a personal cheque? 24 A 25 197 Q 26 The cheque is underneath there Correct. This would appear to be a lodgment to the Ansbacher account of £30,000 made by you? 27 A 28 198 Q 29 A It is the main Yes . Can you explain that? 1 199 Q 2 3 account as an account? A 4 5 It does appear that you were using the Ansbacher No, I was not, Judge. I am sure there is a rational explanation for these. 200 Q Perhaps but at the moment it looks as if monies were 6 being paid in by your company and by yourself into 7 this account, is that not so? 8 A 9 201 Q Certainly on that evidence, yes. There is another document, the letter of 7th June 10 1994 from Ms. Williams to Mr. Redmond enclosing a 11 sterling cheque of £7,000 to the same account on one 12 of your wife's personal cheques, that is another 13 lodgment? 14 15 A Yes , £ 7 , 0 0 0 , yes . M R . O' HANLON: 16 17 moment? MR. JUSTICE COSTELLO: 18 19 Judge, would you give us a Yes, would you like to go to the consultation room? M R . O' HANLON: Yes, just for a moment. 20 21 22 (SHORT ADJOURNMENT) 23 24 M R . O' HANLON: Thank you. 25 MR. JUSTICE COSTELLO: These cheques were sent on 26 by Joan Williams, 27 Mr. Traynor's secretary, 28 these cheques to Ms. Will ams or would you have 29 written and posted them o ' were you in the habit of Would you have handed 1 2 I imagine the first cheques, the cheques paid by 3 Lyndon to IIB, is it? 4 suspect they have something to do with the loan 5 arrangements that Mr. Traynor was making for me and 6 I will check that. 7 not certain now, could be repayments of loans that 8 Mr. Traynor had advanced to me. 9 203 Q 10 A 11 204 Q 12 A 13 They are drafts to IIB, I I suspect that these, and I am That Mr. Traynor had advanced to you? Yes . Did you obtain loans from Mr. Traynor? If I wanted cash for things like, he certainly would, yes. 14 205 Q 15 A Would you have any records of these loans? No, they would be very small anyway, as you can see. 16 On a personal basis he would certainly be helpful to 17 me. 18 will try and check. 19 206 Q 21 A 22 207 Q 23 A 24 He would do that for me, yes. These cheques are not made payable to Mr. Traynor? No, but maybe that is the way he asked for the repayment to be made, I don't know. 25 208 Q 26 A 27 29 If they were loans, were these personal loans from Mr. Traynor to you? 20 28 I don't know, Judge, what they were for but I Very well, you will try and check it out. I will, and these two surprised me to be honest with you. 209 Q I want to come to this substantial loan by IIB and I want to show you a number of documents. The first 1 2 internal memo. 3 Intercontinental Bank (Exhibit 9) and I want your 4 comments on it. 5 subject is Lyndon Properties and it is dated 29th 6 November 1990. 7 This is an internal memo of the It is from Liam Dolan and the He states: "I spoke to Des Traynor following our previous meeting. I confirmed with him and that we saw no problem in setting up the facility for Lyndon Properties on the basis of a back-to-back loan of £2 million at a margin of 1%. I told him that we would envisage taking his deposit into Credit Bank London as this is required to be in another jurisdiction." 8 9 10 11 12 13 Mr. Traynor obviously wanted it in another 14 jurisdiction, not in Ireland; is that correct? 15 A 16 210 Q Yes, correct. It refers to a margin of 1%, do you know what that 17 18 A for the back to back loan. 19 20 211 Q 21 A 23 212 Q 25 26 27 28 29 There would be interest paid on the deposit and interest paid on the loan, and the margin was 1%? 22 24 I imagine that is the fee that would have to be paid I imagine so, yes. "He was happy with that and asked that we should send him out the forms necessary. We will have Sam Field Corbett who looks after the affairs of this company contact us in regard to details of the loan. We should proceed to get credit approval for this transaction and we also need to agree a margin for KB London." 1 Would you just turn to the next document which is a 2 facility letter of 28th January 1991 3 It is addressed to your company and for the 4 attention of Mr. Field-Corbett and it sets out the 5 nature of the facilities, the drawdown date. 6 turn to paragraph 5 on the next page: (Exhibit 10). 7 "Security 8 Any and all indebtedness or liability of the Borrower to IIB is to be secured by the guarantee of Mr. Clayton Love and such other security in such form as shall be required by IIB to its absolute discretion from time to time." 9 10 If you 11 12 A 13 213 Q 14 There is no mention in that letter that the security was to be back to back? 15 A 16 214 Q 17 No. Do you know that in fact it was deliberately kept out of the letter? 18 A 19 215 Q 20 A 21 216 Q 22 A 23 24 That's right. I am not sure but I know it was back to back, Judge. You are not sure it was deliberately kept out? No. Could it have been deliberately kept out? I don't know, Judge. I have signed that letter anyway, so I have seen that letter before. 217 Q I want to refer you now to the next document which 25 is another IIB credit application of 30th November 26 1990 and it refers to the description of the credit 27 lines cash back demand facilities, the initial 28 balance and the interest to be drawn up. 29 the next page it guarantees a collateral charge on Then over 1 deposit place with KB London at a minimum (Exhibit 2 11) . 3 Yes . 4 218 Q So there is no doubt that it was back to back, it 5 was the security of the deposit that was the main 6 security that was being granted? 7 A 8 219 Q 9 Yes . If you look at the last page, page 4, the summary of the purpose was the back to back facility to Lyndon 10 properties. 11 worth. 12 later but in fact your negative net worth was the 13 serious financial position your company was in at 14 the time? 15 A 16 220 Q 17 A 18 221 Q 19 "Major risk. Borrowers negative net Accounts qualified." I will come to that At that time, yes. Your accounts were qualified? Correct. Will you turn over the page to: "The facility is fully secured by at least the amount placed with KB London." 20 21 22 A 23 222 Q Yes . "Due to cash back nature of this transaction, the provision of this facility is recommended." 24 25 26 A 27 223 Q Yes . The next document we need not delay on it, just to 28 look at it for information purposes. 29 guarantee by Credit Bank which was part of the It is the 1 arrangement, Credit Bank was to guarantee the loan 2 (Exhibit 12). 3 there is a counter indemnity from Ansbacher and 4 there is a (Exhibit 13) mortgage of the monies 5 outstanding which we need not bother about. 6 is a side letter from the Credit Bank which we need 7 not bother about for present purposes. 8 just look at a letter of 26th February 1991 from 9 Mr. Traynor transferring the £2 million in this Then if you look at the next document There Would you 10 company's new deposit account which just opened and 11 debiting the Ansbacher Limited call deposit account. 12 The £2 million was sent from the Ansbacher account 13 in IIB in Dublin to the Credit Bank in London 14 (Exhibit 14). 15 16 Now I want to come to documents that were generated 17 in 1993 arising from a new loan structure. 18 you just look at a memorandum from Claire Gannon, 19 the subject being Lyndon Properties and it refers to 20 the previous securities structure which we have just 21 mentioned and then a proposed new securities 22 structure. 23 24 25 26 27 28 29 "A new security arrangement has been approved; (credit application no. 7005) where my CIBT places GBPI 1.45 with KB London as trustee for the beneficial owner of the deposit. (Yale Securities) CIBT therefore executes the security documents as trustee and not in its own personal capacity and CIBT's liability is limited to, the credit balance in the deposit account. This is in order that the transaction is off balance sheet for CIBT." Would 1 For reasons which CIBT thought were good, the 2 security was being changed and instead they were 3 lodging it as trustee, is that correct? 4 A. 5 224 Q. 6 That is what the document says. It states that the beneficial owner of the deposit is Yale Securities, do you accept that? 7 A. 8 225 Q. 9 I do, yes. That this deposit in the name of Ansbacher, that Yale Securities was the beneficiary? 10 A. 11 226 Q. As part of the Elizabeth Love Trust. Yes, I am just looking at what is stated in this, 12 Yale Securities is a separate company 13 ....(INTERJECTION). 14 A. In responding to you, Judge, I do not want you to 15 think that I am taking Yale separate from the 16 Elizabeth Love Trust, they are part and parcel of 17 the same being, if I may use that word. 18 227 Q. 19 This is a matter that would have to be looked at as I am doing it in the legal way. 20 A. 21 228 Q. I understand. In the legal way Yale Securities is a separate 22 company of which it would appear, although we do not 23 know yet, it would appear that the shares are owned 24 by this trust, but Yale Securities was the 25 beneficial owner of the money which was held in the 26 Ansbacher account? 27 A. 28 229 Q. 29 I accept that, Judge, yes. Just one matter that I have to draw your attention 1 a company which was involved from 1971 in your 2 affairs and you were fully conversant with its 3 existence and with its operations. 4 Mr. Ryan, the authorised officer, that you had no 5 knowledge of Yale Securities? 6 In one interview I said I hadn't and in another 7 interview I said I had. 8 Mr. Ryan I went along to his interview as an 9 employee of the bank and was given assurance that Did you say to With great respects to 10 the questions I would be asked would be about what I 11 did as a Director of the bank and he ambushed me, 12 Judge, and I got confused and I am sorry about that. 13 230 Q I see, very well. I just want to ask you some 14 questions about your role as a director of Guinness 15 & Mahon. 16 meetings with the Board only three times a year or 17 so? 18 A 19 231 Q 20 A 21 232 Q 22 A You have said in your statement there were Three or four times a year. The main business was carried on by the executives. Correct. Were you on any committee? Yes, I would have been asked to attend committees 23 from time to time if they were discussing something 24 to do with Cork or anything else I could make a 25 contribution to. 26 Are you indicating that you only went to Guinness & 27 Mahon three times a year? 28 No, no, I would visit regularly. If I was in Dublin 29 once a week I would be in there. I probably didn't 1 go once a week, but probably about 40 times a year I 2 suspect. 3 234 Q 4 A 5 235 Q 6 7 I was, yes. As a director of this substantial company you would have had to attend, would you not? A 8 9 You were regularly going there? The bank were partners to me in all of the developments pretty well. 236 Q 10 Apart from that, your duty as a director would require you to ....(INTERJECTION). 11 A 12 237 Q Yes, as a non-Executive I would attend, yes. More than just attend, you had a duty as a director, 13 had you not, to supervise the affairs of the company 14 and to familarise yourself with how the company was 15 doing? 16 A I suppose, Judge, at the board meetings certainly we 17 would get accounts or progress of accounts from 18 companies that were going to be established, but one 19 never as a non-Executive Director saw what loans 20 were being given to people. 21 238 Q 22 A No, I am not saying that. I certainly was not aware of the back-to-back or 23 whatever you call it, whatever is in the Press, 24 "suitable security", is that the word they use? 25 That was never discussed in front of me. 26 239 Q 27 28 29 You have said in your statement that you did not know anything about the internal audit report? A No, that never came before a Board meeting that I was a t . 1 240 Q 2 Did you know about the system that was being reported on in the internal report? 3 A 4 241 Q 5 A No. Did you know that ....(INTERJECTION). This was the report which is in the Press which 6 condemns large deposits of money, is that what you 7 are saying? 8 242 Q 9 No, I am referring to the report which is in Appendix 12 to the McCracken Report which is an 10 internal report from the accountants in the head 11 office in London (Exhibit 16)? 12 A 13 243 Q 14 A 15 244 Q 16 No, I was not aware of that. Do you know what I am talking about now? I think I do because I read it in the Press, Judge. What I am asking you is did you know about the approved account system? 17 A 18 245 Q No, I did not, Judge. Did you not know that Guinness Mahon Cayman Trust 19 were very large depositors in Guinness & Mahon in 20 Dublin? 21 A I would have been aware that they were depositors in 22 both London and Dublin but not to the extent that 23 has now been exposed. 24 246 Q When you say "not to the extent", they were in the 25 accounts, you could see in the accounts a huge 26 percentage of the total deposits? 27 A 28 247 Q 29 A We would just get the total number of deposits. So you did not know? 1 248 Q. 2 You did not know that your company depended to a very considerable extent ....(INTERJECTION). 3 A. 4 249 Q. 5 A. 6 250 Q. 7 A. 8 251 Q. 9 No, I was not aware, Judge. Were you aware of Mr. Traynor leaving the company? Yes. Were you aware of the terms on which he left? No, I was not. Were you aware that one of the terms was that the deposits held by the Cayman company were to be run 10 down over a period of ....(INTERJECTION). 11 A. 12 252 Q. No, I was not told that. Were you aware that people could enter into 13 agreements with Mr. Traynor by which they could 14 lodge money to the Ansbacher account and take money 15 out of the Ansbacher account? 16 A. 17 253 Q. 18 19 You were aware that the Ansbacher account was earning money or was earning interest? A. 20 21 No, Judge, I was not. I would imagine any deposits would be earning interest, yes. 254 Q. 22 So that Yale Securities if it was the beneficial owner of a deposit was entitled to interest? 23 A. 24 255 Q. Yes, of course. That interest in this case would have gone back to 25 the Cayman Islands to Yale Securities and then back 26 to the trustees? 27 A. 28 256 Q. 29 If it had any monies on deposit, yes. I take it from what you have said today and from 1 arrangements that you have been referring to 2 generated any income which you thought should be 3 returned for your own personal income tax purposes? 4 Judge, I not alone took advice from Desmond Traynor 5 but I also took advice from Michael McMahon and 6 subsequent to that to his successor in Haughey 7 Boland. 8 257 Q 9 A 10 258 Q 11 A 12 Who was that? Michael McMahon's successor would be Pat Kenny. Mr. Kenny. When did you take advice from him? More recently because I was dealing with Michael McMahon for a long time. 13 259 Q 14 A When did he ....(INTERJECTION). Michael died in 1988 or something, I am not too sure 15 of the time he died but some time in the mid 1980's. 16 I took advice also, I remember, on the Wildwood, all 17 of that aspect was done by the bank through Don Reid 18 because they gave tax advice on that. 19 260 Q I was going to ask you about that. I interrupted 20 you, after Mr. McMahon's death who did you take 21 advice from? 22 A From his successor in Guinness & Mahon, I think it 23 was Pat Kenny but I am not sure. 24 used to deal with inside, mostly anyway. 25 need the advice of senior tax advisors really in a 26 way for a lot of my time with them. 27 261 Q 28 A 29 There was a lady I I did not Mr. Don Reid gave you advice? He gave advice to the bank on the setting up of the Wildwood situation. 1 262 Q 2 A 3 I imagine that would have been discussed with him and Guinness & Mahon. 4 263 Q Did you discuss it? 5 A No, not personally. 6 264 Q 7 A Why did you mention Don Reid then? Because I wanted to tell you in relation to Wildwood 8 that was a separate issue that was not dealt with by 9 my own tax people. 10 265 Q 11 A 12 2 66 Q 14 A 267 Q 17 I imagine I did, yes, but it would have been done in When you say you discussed it with Mr. Don Reid, Don Reid was advisor to Guinness & Mahon? 18 A 19 268 Q Yes . Then you say you would have checked it out with your own people, who were they? 20 A 22 I would have asked whoever was the tax guy dealing in Haughey Boland. 23 269 Q 24 A 25 At that time who would it have been? I don't know, I can't remember. I imagine it would have been Michael McMahon. 26 270 Q 27 A 28 29 Did you discuss it with Mr. Don Reid? consultation with Guinness & Mahon, Judge. 15 21 He would have set up the arrangement and I would have checked it out with my own people. 13 16 Did you discuss Wildwood with Don Reid? Did Mr. Reid write out any memorandum for you? Not that I am aware of, no. If he did I don't recollect i t . 271 Q Do you think that Mr. McMahon would have 42 1 2 Mr. McMahon was a very bad writer, as I said to you 3 already. 4 Do you think he would have had any correspondence 5 with Mr. Reid? 6 A I doubt i t . I would have given him what we were 7 doing and asked him was it okay. 8 MR. JUSTICE COSTELLO: 9 That is all I have to ask you about, but as I have 10 indicated we will have to get further information 11 later on. 12 questions. 13 273 Q Ms. Mackey may like to ask you some MS. MACKEY: Just a couple of 14 questions, Mr. Love. 15 First of all, in relation to the Cayman trust, the 16 Elizabeth Love Trust, has any further monies been 17 lodged to it since its setting up? 18 A 19 it ended up with Yale and then came back. 20 274 Q 21 A 22 275 Q 23 24 Came back to? Back to back the IIB loan. No, the question I asked you was about the Elizabeth Love Trust. A 25 26 The money that was borrowed from IIB as I understand The Elizabeth Love Trust as far as money is concerned, there is Yale in my mind. 276 Q 27 So that money came back to Yale, so that augmented, is that what you are telling me? 28 A 29 277 Q Sorry? Maybe I will phrase it another way. 43 The Elizabeth 1 Love Trust was set up with monies that came from the 2 Channel Island Trust? 3 Yes, into Yale and then the trust. 4 278 Q 5 A The only monies added over the years would have been the £2 million that was borrowed from IIB. 6 7 Were any further monies added over the years? 279 Q Right. No further lodgments were made by yourself or your wife or your family to this trust? 8 9 A 10 280 Q No. Obviously interest accruing on Yale's deposit, as 11 you explained to us, would have been going back into 12 the trust as well from Ansbacher? 13 A 14 281 Q Yes . You told us a little in your statements about 15 borrowings that you made from the Elizabeth Love 16 Trust through Yale, could you tell us a little bit 17 about that now? 18 A 19 20 personal nature and they would be paid back. 282 Q 21 22 I made borrowings in the amount, they were all of a How was that arranged and who arranged that you could make borrowings? A When the trust was set up it was agreed that I use 23 or I borrowed, 24 things were not too good, I borrowed money at that 25 time from the trust and then did nothing really 26 until the early 1990's. 27 283 Q 28 29 I think, in the early mid 1970's when You said when the trust was set up it was agreed that you could do this? A 1 284 Q 2 A 3 285 Q 4 A 5 286 Q 6 A 7 The trust agreed it with me. Who on behalf of the trust? Des Traynor. Des Traynor was not one of the trustees, was he? I imagine he agreed it with the trustees, M s . Mackey. 8 287 Q 9 A 10 288 Q 11 Did you have any documentary evidence of that? None whatsoever. It was clear to you from the inauguration of the trust that you could borrow from it? 12 A 13 289 Q 14 A 15 290 Q 16 A 17 291 Q 18 A Correct, yes. Mr. Traynor told you this verbally, did he? Yes . Can you recollect the conversation of what was said? No, I can't. Did you ask him if this would be possible? I imagine I did, but I can't recollect, Ms. Mackey, 19 other than it had to be done as I was advised by 20 Michael McMahon that it had to be a done on a 21 commercial basis and that was the reason for the 22 1.5% charge. 23 292 Q 24 25 had to be ....(INTERJECTION). A 26 27 You were advised by Michael McMahon that the trust If I borrowed money from the trust I had to pay commercial rates for it. 293 Q This was something you had discussed with Michael 28 McMahon from the time of the setting up of the 29 trust? 1 2 294 Q 3 A 4 295 Q 5 6 Correct, and was it permissible and was it in order. Then you went to Des Traynor and you asked him to agree that? A I am not too sure, the idea might have come from 7 him, I don't know. 8 cross-checked it with Michael McMahon at the time. 9 296 Q 10 I would obviously have Did you ever sign a letter of wishes in respect of this trust? 11 A 12 297 Q 13 A 14 298 Q 15 No. Did your wife? No, not that I am aware of. Have you ever seen a letter of wishes in relation to this trust? 16 A 17 299 Q No. In relation to the borrowings from the trust over 18 the years, you have given us an amount of capital 19 and interest. 20 A 21 300 Q 22 A 23 24 Did you make repayments over the years of interest? No, the repayments will be made from the monies Lyndon owe me. 301 Q 25 They will be made but to date no repayments have been made? 26 A 27 302 Q 28 29 Correct, yes, most of it is interest. No. In relation to the Channel Island trust, that is the trust in your name, is that still in existence? A 1 303 Q 2 A I don't know. I have sent out information asking 3 about that. 4 transferred to Cayman. 5 304 Q 6 A 7 8 In 1971? It would have been later, the mid 1970's or something like that. 305 Q 9 10 I suspect it ended when the money was I think you said you were going to check about this, there seems to be some confusion about dates. A Yes, I agree with that. I don't disagree with that. 11 Again I want to make the point to you and I think I 12 made it to the Judge, it was for me a very 13 unsettling time and things about it I tend to put 14 out of my mind. 15 by 1981 there was light at the end of the tunnel and 16 certainly there was very much light at the end of 17 the tunnel in the 1990's even though the accounts 18 declare otherwise. 19 behind m e . 20 306 Q I was over the wall and thankfully Thankfully nowadays it is all As the Judge said, all the more reason why if we can 21 get to look at documents relating to this we would 22 will be able to clarify it. 23 A I am well aware of that, but you must understand in 24 my mind that it was a part of my life that I wanted 25 to just put aside and get rid of. 26 MS. MACKEY: 27 28 29 I understand that. not have any further questions to ask you, Mr. Love. Thank you. I do 1 did you say that your son 2 has already been or is going to ....(INTERJECTION). 3 I asked him to go to the Cayman and he went to find 4 the trustee. 5 308 Q 6 A 7 About four weeks ago and he has been promised that information will be forthcoming. 8 309 Q 9 A 10 310 Q 11 A 12 311 Q 13 14 How long ago was that? Have you anything in writing from them? Nothing whatsoever. From the Cayman? No. Did he ask specifically for the matters that we raised in our letter, namely, the Trust Deed? A He asked for the Trust Deed and they said they would 15 have to go into the archives to see could they find 16 it. 17 312 Q 18 A They would be prepared to give it? Yes. This is the first time we found them in any 19 way -- when we phoned them it was a waste of bloody 20 time. 21 told blah blah blah, so I asked Clayton to go. 22 313 Q 23 A When I got your letter I phoned and I was What were you told? They are very reluctant to give information unless 24 on a one to one basis. 25 that is all I can say to you, Judge. 26 314 Q 27 28 29 They seem to be cooperating, What about statements from the company Yale Securities, annual reports? A There were never any audits, there were just a Statement of Affairs. 1 315 Q 2 What about Statements of Affairs, can you get those over the years? 3 A I don't know. 4 316 Q Will you try? 5 A I will. Des prepared those. Traynor used to give me those and I don't know whether they are out there. 6 7 317 Q 8 A 9 318 Q 10 Will you try? I will, yes. You know the documents from our letter that we require? 11 A 12 319 Q Yes, I do, Judge. We will be in touch with you arising from today and 13 arising from the statement we got yesterday, but in 14 the meantime if you have got documents that you are 15 going to send on to us that you would do so. 16 MR. O'HANLON: 17 I was going to say, Judge, in relation to the 18 documents, to date we have assembled quite a number 19 of documents and obviously the IIB and GM documents 20 which you have seen yourselves, but in addition to 21 that we have documents relating to that whole 22 Guinness Mahon saga in London, the various 23 transactions between the parties right up to the 24 1990 transaction whereby, in effect, Yale acquired 25 the debt from Guinness Mahon London which Lyndon 26 repaid and we have that assignment and so forth. 27 relation to the Cayman situation, obviously we do 28 not know how long this is going to take but our hope 29 is that we will actually have accounts in addition In 1 to trust documents. 2 and it is not ideal that one do these things 3 piecemeal, but nevertheless because we are not in 4 entire control of the situation that we would give 5 you what we have at the moment immediately and 6 obviously follow up once we get the balance. 7 MR. JUSTICE COSTELLO: 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF INTERVIEW What I was going to suggest is, Very well, thank you. STATEM ENT OF J. CLAYTON LOVE JNR. TO INSPECTORS APPOINTED BY ORDER OF THE HIGH COURT TO ANSBACHER ( CAYMAN ) LIM ITED. 1.0. FAM ILY BACKGROUND: 1.1.M y fatherClaytonLove Snr.was bom 9 May 1903.He diedin 1983. Therewere fourchildrenofthemarriagenamely Betsy,Bryan, John and I.Bryan and John are twins. 1.2. My mother and fatherseparated when Iwas inmy teens. This was a particularly difficulty separation. My father had commenced., a relationship with a German national named Anna Gertrude Heidom who had been sent to live with us by her uncle and guardian attheend ofthewar. The relationshipledtothe end ofmy parents marriage. On the separation Anna Gertrude and my fattiermoved out of the family home to a house in Cork Cityand latertoDublin. My brotherBryan went to livewith our father and Anna Gertrude in Dublin. Betsy, John and I stayed with our mother in Cork. As isundoubtedly common in situations ofthisnature various members ofthe family took sides. My sisterBetsy did not speak to nor meet her father again until a few days beforehe died. 1.3.1married Elizabeth Love (nee McCann) in 1951. We have threechildrennamely Clayton, Sarah and Neill.My son Claytonalsohas a sonwho iscalledClayton. 2.0. THE FAM ILY BUSINESS: 2.1. The familybusiness consistedofa group ofcompanies collectivelyknown as the Clayton Love Group (“CLG” ) which was controlledby my late fatherwho was the principal shareholder. The companies traded as Ship Chandlers, Fish Processors, Fish Wholesalers, General Wholesalers, FishingBoat Operators, Restaurant Operators and Frozen Food Distributors. This latter business held the Findus Frozen Foods DistributionfranchiseforIreland. 2.2.My father,my brothersBryan and John, Anna Gertrude and Iworked with CLG. 2.3. In the late 1950’smy latefatherdecided to look fora largerfirm ofAccountants to service CLG which atthis stage was operating in Cork, Dublin and Southampton and was also planning to expand to London and France. In the events Haughey Boland & Co. were chosen and that firm nominated the late Desmond Traynor to handle the account. The first occasion on which Imet Des Traynor was in or about 1959. 2.4. The lateMr. Traynor was quickly forced to adapt to the difficulties that existed within the CLG and sufficeitto saythatbefore long he gainedtherespectofallofus. He became an unofficial referee in areas ofdisagreement ofwhich there were many. He had a greatabilitytoresolve differences ofopinion and indeedhe was appointed a DirectorofCLG inthelate 1960’s. . 2.5. However differences and difficultieswithin the familybusiness continued and I think it is fairto say that many of these differences were of a personal nature and irrespectiveofthe rights orwrongs ofthe situationundoubtedlymany ofthem had as their origin the unhappy differences which had arisen between our parents. My own relationshipwith my fatherwas not good and we were often atodds with each other.I was chosen to represent Ireland at sailing for the Olympic Games in Melbourne in 1956. My father refused to permit me have holidays and Iwas obliged to withdraw from theteam. 2.6. From the mid 1960’s Des Traynor encouraged me to consider alternative employment options. He feltIwould be better offoutside CLG. One of the options which I gave careful consideration to was emigrating to the U.S.A. or Canada. Ultimately on Des Traynor’s advice I opted to stay in Ireland and I left the employment of CLG in 1969. Within a fairlyshortperiod of time Iwas appointed a Director of a number of companies and I also commenced work as a property developerinmy own right.Des Traynorwas my financialandbusiness advisor. 2.7. My personal and professional relationship with Des Traynor continued. Irelied on his advice and over the yearsInever had causeto questionhis advice and actions on my behalf.Ifound him a most trustworthyand competent advisor.He was discreet and confidential and forexample neverdiscussedotherthe activitiesorbusinesses of other clients with me nor in my presence. I vested considerable authority and discretion in Mr. Traynor and as stated never had reason to doubt or question his capacityorjudgement whileactingon my behalf. 3.0 CLAYTON LOVE DISTRIBUTION LIMITED: 3.1.1have been associated in the media with thiscompany. Iam not nor have 1ever been aDirector, Shareholder orExecutive inthiscompany. This media speculationor reportinghas essentiallyconfusedmy latefatherandL 4.0 GUINNESS AND MAHON (IRELAND) LIMITED ( “THE BANK” ) 4.1.1was asked by the lateJohn Guinness who was a friend ofmine through sailing to become a non-executive Director of the Bank so as to assist in developing its business inthe Cork region. Mr. Guinness was then a Director ofGuinness Mahon & Co. Ltd. (“G M ”) the holding company of the Bank and the Chairman of the Bank. The Bank wanted to develop business in the Cork area through a local branch by means ofa locallybasedboard member. Iwas accordinglyappointed aDirectorofthe Bank in 1969 and Iretiredon 30 April 1990. 4.2.The Irish Board members included William Forward, Maurice O ’Kelly, John Guinness, Desmond Traynor, and Don O’Connor. All ofthese, with the exception of Mr.O’Connor were executives of the Bank and/or of GM. I was the sole non­ executive Director. The Secretarywas Gerald McCracken. G M nominated a number of directorsfromtime totime. 4.3. Approximately 3 or 4 Board meetings were held in’Dublin each year. In general the meetings lasted circa one hour or so and were followed by lunch. Ido not recall ever having received minutes of any such meetings. The meetings followed an Agenda and as faras Ican recalldealtwith theBanks own tradingaccounts,bad debt write offs etc.While Idid not attend everyboard meeting, Idid attend such meetings on aregularbasis.During my term themanagement oftheBank changed on a number ofoccasions asindeed didtheidentityofitscontrollingshareholders. 4.4. In addition to Board meetings, Iassisted the Bank informally when required. In general such assistance dealt with new business, e.g. what my views were on a particularprojectorpotentialborrower. Z"*' 4.5. Business discussed atboard meetings did not deal with individual accounts and save on very rare occasions Iwould not have been aware ofany specific dealings or transactions which customers had with the Bank. Imight have known thatparticular companies or individuals may have been customers but no more than that. I was therefore generally aware of the main Cork based customers and the people that the Bank targeted through itsCork branch for the purpose of developing itsbusiness. I was asked on occasion to arrange introductions with professionals such as solicitors and accountants and to attend local branch functions. I was certainly not aware of specific dealings or facilitieswhich customers had either locallyin Cork or through Dublin. The business which was discussed at board meetings generally dealt with overallperformance directionand thedevelopment strategyfortheBank. Accordingly I was aware that the Bank like other Banks had investments in Banks and Trustee Companies in the Channel Islands and inthe Cayman Islands. Iwas aware as to the general performance ofthese operations and as towhether the Bank had disposed of theseinvestmentsorbranches. 4.6.Indeed toreinforcethispositionIwas notaware (ifpressreports aretrue)thatthe late Hugh Coveney T.D. who was a very close personal friend of mine was also a customer ofthe Bank and furtherthatthe lateDes Traynor was his financial adviser. Other than as detailed on the heading Yale Securities Limited hereafter, I was not aware of any day to day operations of these branches, the identity of any of the customers orthesizeornatureofanyparticulartransactions. 4.7.1 was aware that the Bank disposed of its interest in the Cayman Islands in or about Ithink 1978 to a consortium which Iunderstood involved Des Traynor in some shape or form. Ihave no ideaastowhat hisdirectorindirectinvolvementwas orasto any of the other partners in the venture. Des Traynor never informed me of the position nor did any one elseintheBank. Des Traynor never asked me ifIwished to v.' " join such consortium and as stated to this day I have no idea as to who else was involvedsave what Ireadinthemedia. ■ 4.8. I had no knowledge whatever of Des Traynor’s activities or those of the other executives within the Bank; the extent of GMCT or other customer deposits in the Bank; the reported internal audit report carried out by GM; nor of the term “suitably secured”. 4.9.1believe Imet John Furze on threeoccasions. The lasttime was atDes Traynors funeral. The firstand second occasions were atthe Bank. Each ofthesemeetings was very brief and of a social nature. I was aware of the existence of GMCT and understood that itcarried on offshore banking and trust services. While I knew that G M C T was sold to Des Traynor and others, I did not know the details and never spoke toDes Traynor aboutit. ^ /■:^ 4.10.1understood thatOverseas Nominees was a trustcompany owned by GMCT in much thesame way thatMars Nominees was oftheBank. 4.11. As a result of problems encountered by me in the U.K. property market in the mid to late 1970’s my continued position as a Director of the Bank was always in doubt and thisiselaboratedon lateron inthisstatement. 5.0 M Y PROPERTY DEVELOPMENTS FROM THE LATE 1960’s: 5.1. The first major development which I undertook was the construction of the Douglas Shopping Centre in Cork. This was the second such shopping centre builtin Ireland, the Stillorgan Centre being the first.At this stage Des Traynor was thejoint Managing Director of the Bank and he looked after all of the funding and financial planning aspects fortheproject The Bank was apartnerintheventure totheextentof 40%. 1focused on the planning and development issues and our relationshipwas very much a continuation of how we had worked togetherin CLG. Des Traynor was not a shareholderorpartner inthe development nor indeed in any subsequent developments which I undertook. The Douglas Shopping Centre development was a success and I moved on to other developments with Des Traynor handling all aspects of my financial affairs. Des Traynor dealt with both the commercial and financial affairs of thepropertybusiness and indeedhe alsohandledmy privatebanking affairs. 5.2. From the start of the 1970’s Des Traynor pointed me in the direction of London and Ibegan to look at a number of options which were introduced to me by G M in association with the Guinness and Mahon Property Company Limited ( “ GMPC” ) based in Dublin, a subsidiary of the Bank. That business was carried on through Channel Island companies which were owned by a Channel IslandDiscretionaryTrust called the Clayton Love C.I. Trust. The potential beneficiaries of which were my family and me. To the best of my recollection the Trustees were a Mr. Woodward and/or the Guinness and Mahon Jersey Trust Limited or nominees thereof. I do not have a copy oftheTrust Deed. 5.3. I was advised by GM, the Bank and Des Traynor that the most tax efficient manner in carrying out developments in the U.K. was through Channel Island '... /"‘s '. ‘i J companies owned by a Channel Island DiscretionaryTrust.Any profitsearned would, so long as they were not remitted to Ireland, not be subject to Irishtax. Accordingly they set up the necessary structure. At the time I took tax advice from Michael McMahon who was then a tax partner in Haughey Boland. In particular his advice dealt with a suitable tax structure and the advice which I received was that such a structure was lawful and tax efficient Further he advised me that so long as no disbursements were made to me Iwould have no liabilityfor income tax in Ireland. He further advised that ifIborrowed money from the Trusts or companies Iwould . have to do so on a commercial basis as otherwise Imight have a liabilityto income taxinIreland. . • 5.4. hi the events Iidentifiedsome interestingopportunities inLondon in association with GMPC and we began assembling a site for a major office development in the Whitechapel areaofLondon. A largenumber ofinterestshad tobe acquired and many ofthesewere surplustoour needs. Itwas neverthelessimportant forus to buy inthese interests so as to develop the site.This acquisitiontgok a number ofyears to achieve. Interestswhich were surplus to requirementswere disposed ofand thisresulted inthe generationofprofitsofcirca£75,000/£80,000towhich Iwillrefertolater. 5.5. G M were thebankers to theWhitechapelprojectand essentiallytheprojectwas a joint venture between the Clayton Love C.I. Trust companies and GMPC. G M advanced £2.6m. stg. to the project. This was guaranteed as to 60% by me and 40% by GMPC which was a 40% shareholderintheproject. 5.6. Our plan was to assemble a site, obtain planning approval, find a prospective tenant and sign up that tenant in advance of commencing construction. The U.K. Inland Revenue surfaced as the likelypartytotake a lettingofthe entiredevelopment and we were in final negotiations with them when the property market largely collapsed. As a resultthe U.K. InlandRevenue were forcedtore-assesstheirproperty requirements and attheultimatemoment pulledoutofthepre-letnegotiations leaving us with a projectinrespectofwhich we did nothave a tenant Every effortwas made to locate an alternative tenant but itbecame apparent that itwas going to be very difficult to do so in the aftermath ofthe property crash or indeed even to dispose of theassetswithout incurringenormous losses. 5.7. Des Traynor, GMPC, the Bank, G M and Iworked hard to rescue the situation. My position appeared quitehopeless. Ihad given apersonalguarantee and the monies due on footofthatguaranteewere fargreaterthan my assets.The onlycard Ihad was that G M had introduced the Whitechapel project to me and the Bank was a 40% shareholder in the project. I felt that they had responsibility to assist in finding a solution. GM, the Bank and Des Traynor assessed the situation and came up with an arrangement whereby my assets and those of the companies involved in the Whitechapel project came under G M control.Ihad littlechoicebut to accept. Lyndon PropertiesLimited (“Lyndon”)was thevehicleforthe implementation ofthe deal. 5.8. G M appointed three of their executives to the board of Lyndon and effectively took control ofthe company and thisremained so until23 April 1981 when two ofthe three G M appointed Directors resigned as a resultofa furtheragreement with G M in relationtomy indebtedness and thatofLyndon. 5.9. By 30 April 1982 the balance sheet of Lyndon showed a cumulative loss of £5,519,080. G M was owed £2,620,527 and Iwas owed £3,345,566. These loans were payable in sterling. My loan was acquired from G M atnominal cost as part ofthere­ structuring. G M were entitled to interest on part of its loan. I was not entitled to intereston my loan. Any repayment ofmy loanwould giverisetoa Capital Gains Tax charge for me on the amount repaid and itwas clearlyunderstood and agreed that I would not receive any repayment on my loan until such time as GMs loan was cleared. 5.10. By 1990 Lyndons totalindebtednesswas circaIR£$.lm. and ithad accumulated lossesofER£3.1m. G M was owed £3.3m. Stg.and Iwas owed £2.8m 5.11. The part of the G M loan bearing interest had to be repaid. However an agreement was not finalised in relation to the element of the G M loan on which interest was not being earned. My understanding was that if the interest bearing element of the loan was satisfactorily paid then^GM might look favourably on disposing of the non-interest bearing loan on favourable terms to me. Des Traynor informed me that atthe time G M was firmly ofthe view thatthere was no chance of them or me receiving repayment of my loan or theirnon-interest bearing element of their loan. Finally in March 1976 G M agreed terms and these were detailed in their letterof24 March 1976 toLyndon. 5.12. Des Traynor was concerned about this last element as personnel in the Bank were changing from time to time as indeed was ownership of the Bank itself. His concern was that an “understanding” may be worthless as a result of a change in personnel and particularly of course ifmy net worth increased. As I understand the position Mr. Traynor sought clarification with G M and by April 1990 the final element ofthe firsttwo parts ofthe loan was repaid. Des Traynor negotiatedwith G M and theirpreferred option was toassignthenon-interestbearing element ofthe loan to a Third Party ata nominal cost ofIR£1,000. The amount ofthe loan was £2,100,000 stg. 5.13. Des Traynor proposed that Yale Securities Limited should purchase the loan from GM. This had two advantages . G M was no longer in control ofthe loan and the uncertainty surrounding the loanand my potentialpersonal liabilitywas removed. . The Elizabeth Love Trustwhich was theowner ofYale Securities Limitedhad an opportunityofgeneratingincome should Lyndon be abletorepaythe loan. 5.14. Accordingly Overseas Nominees purchased the G M loan on behalf of Yale Securities Limitd for IR£1,000. Yale Securities Limited is a Cayman Islands registered company owned by a Cayman Island Discretionary Trust called the Elizabeth Love Trust which on occasion has been referred to as the Yale Trust. On acquisition ofthe loan Yale SecuritiesLimited demanded repayment ofthe loan from Lyndon. Appropriate exchange control approval was obtained from the Central Bank and Lyndon paid Yale from monies borrowed from Irish Intercontinental Bank (“DOB”).A condition of the arrangement with Yale was that itwould place the monies it received on deposit as security for the IIB loan to Lyndon. This security would reduce asLyndon repaidIIB. 5.15. Des Traynor handled these transactionswith the Trustees ofthe Elizabeth Love Trustand theDirectorsofYale SecuritiesLimited. 6.0 THE ELIZABETH LOVE TRUST 6.1.AfterIleftexecutive employment with CLG. Iwas advisedto establishatrust so as to make provision formy wife and children in the event thatpersonal guarantees etc. which were required for property development would be called as a result of which Imight losemy assets. 6.2.A trustwas establishedintheChannel Islandsand thiswas the Clayton Love C.L Trust The trustowned a number ofcompanies which were activeintheU.K. property market. Later Des Traynor advised thata discretionarytrustformy wife and children be established by the trustees ofthe Clayton Love C.I. Trust and this was setup and based inthe Cayman Islands. This was known astheElizabeth Love Trust. That trust had £75,000/£80,000 settled on itby thetrusteesofthe Clayton Love C.I. Trust. The source of thismoney was the profits generated from some oftheproperty activityin the UJC The Elizabeth Love Trust owned two Cayman Island companies namely Orchid Limited and Yale SecuritiesLimited. Initiallyitloaned thesemonies toOrchid which later repaid the monies and then loaned them to Yale Securities Limited. Orchid ceased trading and was removed from the Cayman Islands company register some years ago. Yale Securities Limited continues to trade but ithas yet to make a distributiontotheElizabethLove Trust. 6.3.From the outsetitwas agreed withtheTrusteesoftheElizabethLove TrustthatI could borrow as required from theTrust viaYale SecuritiesLimited at a commercial ratewhich was calculated at 1.5% above depositrates.This raterose to 16/17% inthe early 1980’s.My indebtedness as at30 September 1999 was £2,497,473 stgofwhich £1,281,684 stgwas interest Iexpect thatby the end ofthisyear Lyndon willbe in a position to repay what itowes me and Iplan to repay Yale Securities Limited from thosenetproceeds. 6.4. As Yale Securities Limited isthe only asset ofdie Elizabeth Love Trust and as the Elizabeth Love Trust has notmade any distributionsto thepotentialbeneficiaries ofthattrust,thevalue ofYale SecuritiesLimited isessentiallythevalue ofthetrustas atthisstage. 6.5. Yale has had a mixed but ultimately successful trading record to date. It has achieveditsobjectivealbeitsomewhat laterthanplanned. 6.6. All monies received by Yale has been generated from trading activities save the original loan from the Elizabeth Love Trust which in turn received this from the Clayton Love C.I. Trust Those monies were generated from trading activitiesoutside theState. 6.7. The primary motive in establishing Yale was not as might be expected taxation avoidance. Rather itwas to protectmy femilyinthe event ofa financialdisaster. Over the years Yale has supported activities which I have been involved in in the Irish property market in the sense of providing loan security and direct loans to various propertycompanies withwhich Iwas involved. 6.8. Yale was also involved in a propertyinvestment in the United States which was unsuccessful and indeed considerable losses incurred. That investment was through Lynbrette Trust and related to an investment in a trailerpark in Arizona which was banked by AIB. ■ 7.0 ANSBACHER DEPOSITS 7.1. Until the publication of the McCracken report I was unaware of the scheme which Des Traynor operated on behalfofAnsbacher Cayman Limited (“Ansbacher”) depositors and Isay thisinboth my capacityas a foijnerDirectoroftheBank and as a connected person to Yale Securities limited and indeed as a personal friend of the lateDes Traynor. 7.2. I was aware that Yale had deposits with GMCT and that these had an account reference of“M ”.Ididnot know where thedeposits were held. However Iwas aware thatGMC T didhave depositswiththeBank and alsowith GM. 7.3. Whenever I required to borrow from Yale, I advised Des Traynor who would eitherdirectlyrequest the money or in the alternative get me to contact some one in eitherDublin orinthe Cayman Islands. Iwas veryopen about thisand indeed most of the requests were confirmed by me in writing. Isimply assumed that the money was transferredfrom Yale throughthe Cayman Islands. 7.4.Since Des Traynors deathany dealingshave been with Ansbacher. 7.5. I know both Sam Field Corbett,and Padraig Collery and approached them for clarification as to how Des Traynor had been handling any ofYale Securities money and while they were happy to assist they were unable to give me any helpful information. 7.6.1have been in direct contact with Ansbacher who have been helpful in terms of providing information on Yales accounts but have not been able to give me any informationbeyond that Iam awaitingcopyoftheYale accounts from Ansbacher. 7.7.1believe that loans from Yale SecuritiesLimited were routedto me viaHamilton Ross on theinstructionsofDes Traynor. J. . . ^ j ^ l a r c h 2000. 1. S U P P L E M E N TA L S T A T E M E N T O F J. C L A Y T O N L O V E JN R . T O IN S P E C T O R S A P P O IN T E D B Y O R D E R O F T H E H IG H C O U R T T O A N S B A C H E R ( C A Y M A N ) L I M I T E D _________________ 1.0. CLAYTON LOVE C .I. TRUST: 1.1. This Trust was established in or about 1971. While to date I have been unable to obtain a copy of the Trust Deed I am aware that one was executed as I have discovered a copy document sent to me by Des Traynor showing that under Clause 32(1) of the Deed Christopher Woodward resigned as a Trustee and appointed Guinness & Mahon JerseyTrustLimited inhisplaceon 17 December 1973. However I understand that Guinness & Mahon Jersey Trust Limited (Reg. No. 61S8) was dissolved on 2 October 1989. The only documents which I hold are those already furnished being a copy of the said document which was sent by the lateMr. Traynor to me on 14 February 1974 and the Joan Williams letterto me of26 April 1974. As previously indicated this Trust owned a number ofproperty companies which traded in the U.K. It generated some funds and settled c.£75,000/£80,000 on the Elizabeth Love Trust. The late Mr. Traynor established the Trust for me and while Ihave no recollection of signing a Trust Deed, clearly such must have been prepared. I have neverreceived a distributionfrom thisTrust. As previouslyadvised Iwas advisedthat itwas perfectlylegitimatetoestablishtheTrustatthetime ofitsestablishment. 2.0. TH E ELIZABETH LOVE TRUST: 2.1. The late Mr. Traynor arranged for the establishment of this Trust and as stated the Trustwas establishedon 23 April 1971. 3.0. TRANSCRIPT OF EXAMINATION 8 M A R C H 2000: 3.1. 1 wish to clarify certain of the responses given by me during my examination on 8 March 2000 as follows:- Q7. Since the date of my examination my son has travelled to the Cayman Islands and obtained a copy ofthe TrustDeed which we now know isdated 23 April 1971. Q30. My wife BettysignedtheDeed. Q35. As statedwe now know thattheTrustDeed was signedby my wife Betty. Q38. Please referto theDes Traynor letterof2 November 1972 regardingthe initialcapital of £40,518.35 and £20,000 which was paid to the Trust in 1971 and 1972. These monies were transferredfrom theChannel IslandstotheCayman Islands. Q55. The only statement ever shown to me by Des Traynor constituting what I would regard as a Bank statement is the copy statement of Guinness & Mahon Limited furnished by me. Other than that document the only document which Mr. Traynor ever gave tome was a form ofStatement ofAffairswhich as statedhe gave me once a yearatmost. ' Q69. The American property investment was via Lynbrette Trust and not Lyndon Properties. Q89. My answer is incorrect The properties were assembled from 1969 (please refer to paragraph 5.2. ofmy statement and toQ7 ofthetranscript). Q108. We now know that the Channel Islands Trust was established on 3 September 1971. However itwas intheprocess ofbeing establishedforsome periodbeforethatbut for how long Icannot be certain. The 1971 advance of£40,518 to the Cayman Trust was Ibelieve from profitsgenerated by theproperty companies in theU.K. Ican certainly state that the source was not from any income or capital of mine or that of my wife which was generated inIreland. Qlll. The yearsareincorrect Pleaserefertothe 1976 Bank re-structuringdocument. Q150. Et seq: Lynbrette was a TrustwhereinYale investedwith others ina propertyventure intheUnited States.As previouslyadvisedthedevelopmentwas unsuccessful. Q171. Yale’sM and Ml accountwere setoffagainstpersonaldebts. Q179. The account (Ml) was thepropertyofYale SecuritiesLimited. Q189: 195. Ihave checked the accounts ofLyndon Properties and thesepayments aretreatedas a loanby Lyndon toYale. Q196202. These cheques i.e.£30,000 and £7,000 woe lodged from personal accounts and were re-payments of loans by me to the late Mr. Traynor. Insofar as I can ascertain the monies have nothing whatever to do with the Elizabeth Love Trust or Yale Securities Limited. On a number of occasions Mr. Traynor made personal advances to me for limited periods of time. While Ihave no recollection of these monies, Ibelieve that thesecheques representedrepaymentsby me ofsuch advances. Q199. I want to make it abundantly clear that I have not at any stage used the Ansbacher accounts as a personal account or anything of that nature. We are endeavouring to obtain a copy oftheYale accounts and thesewillofcoursebe provided once received. 2 ooMU/3aowmeu-i.ATT WIND-IAN T H I S I N D ENTURE OF SETTLEMENT is m a d e the A.D. ■ Road, 1971 BBT W B B H 1 Cork, in- - ‘ day of f^avvl E L I Z A B E T H LOVE . o f " C l a n r i c a r d e " , Blackrock ' • ' Ireland (hereinafter cal l e d " the Settlor") of the on e p a r t and GUINNESS M A HON C A Y M A N T R U S T LIMITED a c o m p a n y incorporated under the laws o f the Caynan Islands arid c a r r y i n g on business therein (herei n a f t e r called "the *• s T r u s t e e s ” which term shall also i n c l u d e a n y additional or s u c c e s s o r trustee or trustees hereof) of the other part WHEREAS the Settlor has cau s e d the property d e s c r i b e d in the First Schedule here t o (which together •% ♦♦ w ith the m o n e y investments and p r o p e r t y f o r the time being r e p r e s e n t i n g the same and any a d d itions o r diminishments t h e reto a n d any further property b e c o m i n g subject to the » * trusts h e r e o f is hereinafter called " the T r u s t Fund") to be duly transferred into the name o r u n d e r the control of the T r u s t e e s with the intent that the s ame shall be held upon the trusts hereinafter expressed N O W THIS SETTLEMENT W I T N E S S E T H as follows: 1. The Trustees shall stand p o s s e s s e d of the Trust F u n d d ur i n g the period commencing o n the d a t e of execution of these presents and terminating on the expiration of twenty (20) years after the death o f the l ast survivor of the lineal descendents now living o f ..His L a t e Majesty Kii-g Ge o r g e the Fifth or on the expiration of seventy y e a r s from the date hereof '' (whichever shall be the earlier)- (said periocE • being / ..... B a a B S H e * e i ^ ?a£ e Two I ' ■being h e r e i n a f t e r called . '■ ’ ”the A c c u m u l a t i o n Period'* a n d said termin a t i o n data b e i n g h e r e i nafter called "the F i x e d B a t e ”) U P O H T E U S T as' to investments or property o ther t h a n money either t o permit a l l or any of the s a n e to r e m a i n as invested for as long a s the Trustees s h a l l in their a b solute d i s c r e t i o n d e e m fit or to sell c a l l in or c o n v e r t into m o ney a l l or a n y of such investments or p r o p e r t y U P Q M T R U S T ,as to m o n e y including the money ^ a r i s i n g f r o m any s u c h s a l e c a l l i n g in or conversion a s ) ’ a f o r e s a i d to invest the s a m e i n or upon any of the investmeats h e r e i n a f t e r a u t h o r i s e d - 2. •• T B S Trustees m a y a p p l y or invest the Trust F u n d in the p u r c h a s e of or a t i n t e r e s t upon the security o f such s t o c k s funds shares s e c u r i t i e s options or other investments or p r o p e r t y w hether r eal o r p e r s o n a l raovziKe or immovable o f w h a t e v e r nature and w h e r e v e r situate (including a n y •v f r a c t i o n a l or undivided int e r e s t therein and including the p u r c h a s e maintenance or i m p r o v e m e n t of a freehold or lease­ h o l d dwell i n g h o u s e sit u a t e a n y w h e r e in the world for use as a residence) and w h e t h e r i n v o l v i n g liability or n o t and w h e t h e r producing income or not or upon such personal c red i t w i t h or without security, .as the Trustees in t h e i r a b s o l u t e discretion shall think fit w i t h power from t i m e to time t o v a r y such i nvestments for others of a like nature (yet being under no duty to diversify investments) and with, power to hold cash funds uninvested and oth e r n o n - i n c o m e producing p r o p e r t y to ..the extent that the T r u s t e e s s h all have the same full and unrestricted p o w e r s of i n v e s t i n g the Trust F und in a l l respects as if t h e y w ere / ..... ■ware absolute owners beneficially entitled P R O V I D E D h o w e v e r that in the pr o f e s s e d execution of the trusts and powers hereof the T r u s t e e s shall not be liable for a n y loss to the Trust F und a r i s i n g b y reason of any investments made i n good ‘ f a ith or b y -reason of a n y mistake or omission m a d s in g o o d faith b y the Trustees or b y rea s o n of any *» o t her matter or thi n g except w i l f u l and indivi d u a l fraud or wilf u l and individual wrong-doing o n the p a r t of the Trustees ivho a r e sought to be made liable w i t h o u t limiting th e generality of tha foregoing the Tr u s t e e s a r e hereby s p e cif i c a l l y emp o w e r e d to mala investments and t o acquire p r o perty w i t h o u t a n y requirement of d i v e r s i f i c a t i o n even though such i nvestments or property m a y b e h i g h l y specula.-ii\ or not of a type w h i c h are ordinarily l e gal or suitable trust investments or holdings in particular the Trustees m a y margin or h ypothecate trust assets or securities in w h o l e or in p art s e l l short purchase or s e ll-options puts c a lls or other contracts or securities or commodities and c a r r y on trading activities of e v e r y t ype whatso e v e r 3. T H E T r ustees shall have the p o w e r to s e l l lease or exchange and to grant options to p u rchase lease or exchange any p roperty movable or immovable (which e x p r ession shall be deemed always to include any p a r t or s h a r e of a n 3r s u c h property w h i c h may at any time constitute t h e whole or any part of the Trust Fund) either at public auction oir private sale for s uch consideration and o n such terras c r e d i t or security as the Trustees may deem advisable a n d wbetherr for the purpose of re-investmant distribution .or diversiorr. and no purchaser on any sale b y the T rustees or other p e r s o n K Page Four into the propriety or val i d i t y of a n y act of the Tru s t e e s , - or to sea to the a p p l i c a t i o n of a n y m o ney paid or p roperty -■ transferred to o r :'upon the order of the Trustees 4 . During the A c c u m u l a t i o n Period the T rustees shall stand possessed of the T r u s t Fund and the income thereof u p o n %tha following trusts that is to say: (a) U p o n T r u s t for all or any to the exc l u s i o of the others or other of the persons described in the i Second Schedule h e r e t o (hereinafter called ,rthe B e n e f i c i a r i e s fO « « in such shares and i n s uch manner and o b j e c t to s uch limit­ ations and provisions a s the Trustees in their ab s o l u t e and .. uncontrolled d i s c retion at a n y time or times before the Fixed Date b y any d eed or deeds revocable or irrevocable ° •without transgressing t h e rule, against perpetuities m a y a p point and so that toy a n y such appointment the T r ustees m a y confer upon a n y a p p o i n t e e any valid power or p o w e r s of ^ • appointment in favo u r of a n y other Beneficiary A M D it is escpressly provided (without prejudice to the g e n e r a l i t y of i “s t h e foregoing) that t h e Trustees m a y appoint o n discretionary trusts and that s uch trusts may include as objects of the powers as regards income of the T r u s t Fund a n y Beneficiary a n d m ay dispose of the w h o l e or a n y part of the Trust Fund to the Trustees of a n y other Settlement . (in existence at the time of such d i s p o s i t i o n and whether in accordance with the laws of the C a y m a n Islands or not) under w h ich a n y Beneficiary is a b e n e f i c i a r y .to be held as a n accretion . v< ><. t o the Trust Pund thereof and ’subject to any such a p p o i n t ­ ment and so far as the s ame may not extend (b) / p V v j'H -i'& i vfca;*: Page Five (b) Upon Trust to accumulate a n y income of the . 1 i '• • ** T r u s t F u n d in the w a y of compound int e r e s t b y investing the s a m e a n d the resulting income t h e r e f r o m in any of the i nvestments hereinbefore authorised a n d addi n g such a c c u m u l a t i o n s .and resulting income a s a c c r etions to and a s 'a' p a r t of the Trust F und ' duly ap p o i n t e d nominee w i t h o u t disclosing the fiduciary r e l a t i o n s h i p and (viii) and T o o m i t to register bonds or securities . _ I (ix) T o Jtoeep the w h o l e or any p a r t of t h e documents r e l a t i n g to and the m o n e y investments . and p r o p e r t y comprised in the said Trust F u n d w i t h i n o r w i t h o u t the s a i d Cayman Islands (c) T o invest re - i n v e s t and manage the Trust Fund e i t h e r separa t e l y or together w i t h other funds to acquire and retain the shares or securities of investment companies or investment trusts w h e t h e r of the open or closed type and w i t h o u t notice to anyone to participate in any common trust fund maintained b y any corporate trustee at any-, time s e r v i n g hereunder (d) T o engage the services of a n investment adviser or advisers at the expense of the Trust F und and w i t h o u t liability to fol l o w the recommendations of s u c h adviser or advisers even though s u c h recommendations may be high l y speculative or not of a type w h i c h would or d i n a r i l y be legal or suitable trust investments (e) • T o bor r o w or lend money o n such t e r m s and f r o m or to s u c h persons including the Beneficiaries 3. 5? t . h f l * T 'v ll! ^ 1 vn fl */ r f p a + ja 'r'm *1n P ih p > T f i f l R O n P -T l 1f t ftn r? 'T iV C iT iR 'C a n d -without limiting tha generality of the foregoing to m a r g i n or hypofchscate'tall or a n y -portions of the T r ust ']?und • (f) ^ o make execute and deliver deeds conveyances a s s i g nments*transfers options leases mortgages instruments o f pled g e instruments creating liens contracts and other i n s t r u m e n t s sealed or unsealed to raze or erect a n y build­ i n g or other structures and to make a n y k i n d of improve­ m e n t s w h i c h the Trustees deem proper (g) ?7ithout prejudice to the j u r isdiction of t h e C o u r t and according to the respective rights a n d i n t e r e s t s of the persons interested to t r e a t as income or c a p i t a l or to apportion between income and capital a n y ' d i v i d e n d s stock dividends rights interest rent issues and p r o f i t s derived f rom any property at any time comprised i n the Trust j?und and generally to de t e r m i n e what p a r t of t h e receipts of tha Trust is income and w h a t is capital a n d w h e t h e r or not such property is w a s t i n g or unproductive o r w a s purchased at a premium or discount a n d n o t w i t h ­ s t a n d i n g tha time w han such dividends s t o c k dividends r i g h t s interest rents issues or profits w e r e earned accrued d e c l a r e d or paid to make such reserves out of income or c a p i t a l as the Trustees daem proper for expenses taxes and o t h e r liabilities of the Trust to pay f r o m income or froro c a p i t a l or to apportion between income and capital any e x p e n s e s of making or changing investments a n d ’-of selling e x c h a n g i n g or leasing including brokers' commissions and c h a r g e s and generally to determine w hat p art of the e x p e n s e s of the Trust shall be charged to capital and Page T e n 1 and s e p a r a t e parts or shares the a l l o c a t i o n of inco m e gains p r o f i t s losses and distributions (h) T o carry o n participate or invest i n a n y i» corporation p a r t n e r s h i p joint venture or c o - o p e r a t i v e and to enter into such leases contracts or other undertakings _ r e l a t i n g to the T r u s t S’und or any p a r t of ‘it as the Trustees s h a l l in ths i r uncontrolled discretion d e e m a d vantageous ; n o t w i t h s t a n d i n g that s u c h leases contracts or undertakings ' ' 'extend or m a y extend beyond the termination of this Trust (i) T o institute prosecute and defend a n y suits or actions o r other proceedings affecting the T r u s t e e s or the T r ust F u n d or a n y part thereof to compromise a n y matters % of d i f f e r e n c e or compound any debts owing to t h e m a s Trustees or a n y other claims and to adjust a n y d i s p u t e s in r e l a t i o n to debts or clairos against t hem as T r u s t e e s '■n . upon e v i d e n c e that to the Trustees s h all seem, su f f i c i e n t and in ■whole or in part at public a uction or private sale or o t h e r w i s e and u p o n s uch terms and for s u c h terms a s the Trustees, d e e m advisable to make p a r tition w i t h the co-owners or joint owners besides the Trust having a n y in t e r e s t in any p r o p e r t i e s in w h i c h the Trustees are interested and to make s u c h p a r tition either by sale or b y s et-off or b y ag reement or otherwise (including w h e r e dee m e d d e s irable p r o vision for equality of exchange) (j) To take’ the opinion or advi c e of c o u n s e l c o n c e r n i n g a n y difference arising under this S e t t l e m e n t or any mat t e r in any w a y relating to the T r u s t Fund or to the T r u s t e e s * duties in connection w i t h the T r ust F u n d and (i) T o e m p l o y and pay at the expense of the Tr ust Fund a n y .age'rit -In any part of the world whether a n attorney s o l i c i t o r banker ac c o u n t a n t stockbroker or other agent and w h e t h e r or not b e i n g one of the Trustees hereunder to tra n s a c t a n y business or do any act required to be transacted or d o n e in the e x e c u t i o n •k o f the trusts hereof including the r e c e i p t or p a y m e n t ol money and the execution of doc u m e n t s and no f i r m a ssociation or corporat­ i o n any of w h o s e securities are inc l u d e d within the Trust Fund and no pu r c h a s e r or other p e r s o n dealing w i t h any agent purporting to act, under d e l e g a t i o n of authority froaa the Tru s t e e s s h all b e required t o ascertain or enquire whe t h e r a c a s e exists in w h i c h s uch delegation is permitted or w h e t h e r s u c h delegated au t h o r i t y is still subsisting S R O V I D S D h o w e v e r that the Tru s t e e s s h all not b e responsible S o x the default n e g l i g e n c e or Iraud of any age n t so employed or for a n y loss 'occasioned thereby a l though the e m p l oyment of such a g ent w a s not strictly necessary or e x p edient (1) U p o n and for the p u r p o s e of any distribution, or appropriation of the T r ust F und or a n y part thereof in their unfettered di s c r e t i o n to place s u c h value o n any and all assets from time to time forming p art of the T r ust Fund as to them in their absolute and uncontrolled discret­ ion shall seem just and proper and any s u c h valuation made in good fai t h shall be absolutely f i n a l and binding and conclusive on all beneficiaries her e u n d e r and further upon a n y such discretion or a p p r o p r i a t i o n to determine to w h o m specified asse t s shall be g i v e n and to distribute the same subject to the payment of such a m o u n t s as mav be ' C /L O S /C 2 /0 3 0 4 0 0 Page Twel v e 1 , , n e c e s s a r y to adjust the shares of the various B&neficiaries ■ -and further that any distributions of the Trust F u n d may b e either m a d e directly to a n y B e n e f i c i a r y or applied for his ben e f i t b y tha T rustees or during his m i nority m a d s to h i s duly appointed guardian or to any p e r s o n w ith w h o m he lives or resides for the use of the said B e n e f i c i a r y ^ w i t h o u t responsibility for its expenditure 6, ) • WIT H O U T prejudice to the g e n e rality of C l a u s e • 5 here o f if the Trust Funds shall include any shares or «< ’’ . o t h e r interests in a com p a n y the o w n ership of w h i c h gives t o t h e m the right in a n y circumstances to control t h e '*■ . a f f a i r s of the Company or of a n y of its subsidiaries the T r u s t e e s shall be under no liability or duty to a p p o i n t a n y representative to the Board of the said Company or o f a n y of its subsidiaries and further shall have n o r e s p o n s i b i l i t y to enquire into oversee or take p art in the ma n a g e m e n t or affairs or business of the C o m p a n y or ) a n y of its subsidiaries 7. XH addition to reimbursement of their proper ex p e n s e s the Trustees shall be entitled to remuneration (free of a n y probate su c c e s s i o n estate or other d e a t h duties w h e r e soever payable and as a first charge o n the T r u s t Fund) for their services as Trustees in accordance w i t h their published scale of fees in force from t ime to time PROVIDED however that the Trustees may 'transact v o n beh a l f of or w ith the Trust or any Beneficiary h e r e ­ un der a n y business w h i c h by their constitution they are a u th o r is e d / .......... a u t h o r i s e d to undertake, upon tha same terms as w o u l d for j; * the time b e i n g he mada'with an o r d i n a r y customer and w i t h o u t a c c o u n t i n g f or a n y profit t h e r e b y made and in particular and without prejudice to the generality of the t » for e g o i n g tha Trustees may retain o n current a ccount or dep o s i t a c c o u n t or advance at interest a l l moneys necessary or c o n v e n i e n t to he retained or a d vanced in connecti o n with the T r u s t and way retain for thawsalves a n y commission or r e m u n e r a t i o n paid or allowed by s t o c k b r o k e r s insurance .companies or other agents without b e i n g ..liable to account for a n y p r o f i t thereby JPRQVIIDBD further that the Trustees a a y tra n s a c t business on behalf of the T r u s t or any b e n e f i c i a r y hereunder w i t h any c o r p o r a t i o n or partnership i n w h i c h tha Trustees are office holders or shareholders or p a r t n e r s or are otherwise financially interested or with a n y p e r s o n or firm h olding shares of b e i n g otherwise fi n a n c i a l l y interested in the Trustees w i t h o u t bei n g liable t o account for a n y profit accruing to the T r u s t e e s a3 such o f f i c e holders shareholders or partners as a result of s uch b u siness and the Trustees m a y h o l d office i n any c o r p o r a t i o n shares or securities W h i c h comprise or f o r m part of the Trust Fund and shall not be liabie to account to the T r u s t for emoluments received by t h e m as such office hol d e r s 8* (a) substituted) ' • . THS Trustees hereof (whether original or may at any time or times be removed f r o m their office of Trustee by a Deed executed by the Settlor after called (herein­ "tha Appointor").and delivered to the-Trustees and the A p p oi ntor way by deed executed and delivered as • . fMry.Awt . '?■ : a -^■ ;'J.L.V;’ r_.- ^-.:ii.' i,^..' --'■ -’ -^--t , - ......• ----.-^...w.u ■ -. ill"I1 aUd-H iIpiii wifvAiM Page F o u r t e e n not r e s i d e n t in the Cayman Islands to b e T r u s t e e s either jointly w i t h any other.then continuing Tru s t e e s o r solely if after r e m o v a l -there shall not bo any c o n t i n u i n g T r u s t e e s and t h e r e u p o n the Trust Fund shall be b y such a s s u r a n c e as m a y b e necessary or expedient vested jointly in the persons w h o shall thereupon become the T r u s t e e s of the T r u s t s h e r e b y c r e a t e d PROVIDED howev.er that a n outgoing trustee w h o is liable as a trustee hereof o r may o n the death of a n y p e r s o n become liable as a former t r u s t e e • * * thereof for a n y i n c o m e probate estate or oth e r d u t i e s fees or taxes s h all n o t be bound to transfer the T r u s t Fund as af o r e s a i d unless reasonable security is provided f o r ■ i i n d e m n i f y i n g s u c h ou t g o i n g trustee against s uch liability P R O V I D E D A L S O t hat no removal of trustees b y the Appointor sh all b e ef f e c t i v e unless after such r e m o v a l (either with . . « VH • . or w i t h o u t a raw appointment) there shall r e m a i n a t least one tru s t e e b e i n g a trust corporation or t w o t r ustees b e ing individuals (b) in s u b - c l a u s e W i t h o u t prejudice to the p o w e r s con t a i n e d (a) of the Clause if a T r u s t e e h e r e o f w h e t h e r o r i g i n a l or substituted shall die or b e i n g a c o r p o r a t i o n be d i s solved or shall desire to be discharged f rom a l l or a n y of the trusts or powers h e r e o f or shall l'efuse or become unfit to act therein or become incapable of act i n g the r e i n then the following persons namely: ’ (i) T h e Settlor or if she shall be dead 'or unable or unwilling to act (ii) T h e surviving or continuing T r u s t e e s h e r e o f for the time being or if t h e r e be l7~~THr~rnr?ji fag mii no s.ur.viving; or continuing Trustees r * (iii) i ‘ ‘i • T h e p e r s o n a l r e presentatives of the last s u r v i v i n g Tru s t e e if such last i T r u s t e e w a s a n individual but if such last T r u s t e e w a s a corporation then ' s u c h last T r u s t e e upon retirement way b y d eed appoint one or more other persons • or c o r p o r a t i o n (whether or not b e i n g or .including the persons exercising the power) to b e a T r u s t e e - o r Trustees in the p l a c e o f the Tru s t e e so deceased d i s s o l v e d des i r i n g to be discharged r e f u s i n g or b e i n g unfit or being in c a p a b l e as aforesaid (c) contained m T h e p o w e r s in Bub-clause (a) of this Cl a u s e a y at a n y time be i rrevocably released b y a deed executed b y the A p p o i n t o r and delivered to the Trustees and the A p p o i n t o r m a y i n like manner revocably or irrevocably g r a n t t h e said powers to any person or persons to take e f f e c t im m e d i a t e l y or after the death of the A p p ointor as the c a s e m a y be (d) T h e T r u s t e e s h e r e o f or a n y of them (whether original or s u b stituted) may if they so desire r e s i g n as Trustees he r e u n d e r after 3 0 days w r i t t e n notice of their intention so to do s e n t b y registered prepaid post to the A p p ointor or such p e r s o n as the Appointor nay from time to time app o i n t in w r i t i n g such resignation shall become effective upon the day specified in such notice of resignation ■ - -'....- - ■ -.......*.w.. i... ’ .'.....-.— '--i-.-.^-— , -' -L-- P a g e S ix t e e n , (e) In the .event of the r e s i g n a t i o n of the •T r u s t e e s hereof .ox;in c a s e there shall b e no trustee h e r e u n d e r Guinness Mah o n Bahamas Trust C o m p a n y Limited or its succes s o r s shall b e c o m e substituted Trustees hereunder i i (f) U pon the resignation or r e m o v a l of the T r u s t e e s as hereinbefore provided the T r u s t e e s s h all be e n t i t l e d to receive reimbursement out of the Trust Fund for all e x p a n s e s incurred b y them in co n n e c t i o n with t h e settle­ ) m e n t o f the account of the Trustees «♦ (g) On e v ery change in the t rusteeship a m e m o r a n d u m shall be endorsed on or p e r m a n e n t l y aff i x e d * to t h i s Settlement s t a t i n g the names of t h e Trustees for the t i m e being and shall be s i g n e d by the persons s o named and authenticated by a not a r y or notaries public a n d any p e r s o n dea l i n g with the Trust shall be e n titled to rely upon a n y such memorandum (or the latest of such memoranda ^ if m o r e t han one) as sufficient evidence that the persons : named the r e i n are the fully constituted Trustees f o r the time b e i n g of this Settlement (h) Any substituted Trustees of this Settlement shall h a v e all the powers conferred upon the Trustees by law a n d these presents and any and all b a n k s brokers n o m i n e e s or other depositories custodians of the T r u s t Fund s h a l l be atthorised to accept instructions from the said substituted Trustees as to the dispositions- thereof 9. T H E Trustees shall provide for the safekeeping cf all do c u m e n t s of title and securities the subject of this / ..... ' Pa-gg Seventeen -this Settlement and may: at the expense of the T r u s t F u n d . (which expense may'include any charges for the safe c u s t o d y oi securities and the collection and r e m i t t a n c e of income) deposit the same in the custody of a n y b a n k b a n k i n g company corporate trustee or stockbroker i n a n y pari o f the world that undertakes the safe custody o f s e c u r i t i e s as part of its business but so that the T r u s t e e s s h a l l n o t b e in any w i s e responsible for the m i s a p p l i c a t i o n of t h e s a a e or a n y of them b y such banking company corporate * tru s t e e or stockbroker or for any loss ..which may b e o c c a s i o n e d thereby 10. IN the event of any income probate estate o r other d u t i e s fees or taxes becoming payable in the C a y m a n Islands or e l s e w h e r e in respect of the Trust Fund o r a n y p a r t t he r e o f o n the death of the Settlor or of a n y B e n e f i c i a r y or ot h e r w i s e the Trustees may at their discre t i o n p a y all or a n y part oi such duties fees and taxes out of t h e Trust Fund w i t h o u t recourse against any B eneficiary or r e f u s e to p a y the same or any part thereof unless i n d e m n i f i e d and to determine the time and manner of s u c h p a y m e n t if any 11, named N O bond shall be required of the Trustees h e r e i n (whether original or substituted) or if a b o n d should be req u i r e d b y law to the extent that a w a i v e r by t h e Settlor is effective no surety shall be r e quired o n such a bond ■ P a g e Ei g h t e e n 12. i T H I S T r u s t shall be irrevocable a n d the Settlor e x p ressly ■waives, all right and power w h e t h e r alone or in conjunction w i t h any other person to a l t e r amend or revoke this S e t t l e m e n t in whole or in part or a s t o any of its terms 13. ' ' . T H E T r u s t e e s shall not be p e r s o n a l l y liable on contract m a d e b y t hem in the a dministration of the T r u s t and persons e n t e r i n g into contracts w i t h the T r ustees shall look s o l e l y to the Trust Fund ♦ • 14. *••• W I T H O U T prejudice to the right u n d e r the g e n e r a l law of the T r u s t e e s to refuse disclosure of a n y d o c u m e n t it is h e r e b y dec l a r e d that the Trustees s h a l l not b e bound to d i s c l o s e to any person any of the following documents that is to say: (1) of the T r u s t e e s • A n y document disclosing a n y deliberations (or any of the Trustees) as t o the m a n n e r in w h i c h the T r u s t e e s should exercise a n y p o w e r or a n y discretion c o n f e r r e d upon the Trustees b y this Settlement or disclosing the reasons for any particular exercise of a n y such p o wer or any such discretion or t h e material upon w h i c h s u c h reasons shall or ra^it h ave b e e n based (2) A n y other document relating to the exerci s e or proposed exercise of any power or any discretion conferred o n the T r u s t e e s by this Settlement (not b e i n g legal advi c e obtained b y the Trustees at the cost of the trust estate) A N D / ..... PHI ^ o 8 Nineteen A N D IT IS E X P R E S S L Y P RO V I D E D that the TRUSTEES M A Y P E R M I T any B e n e f i c i a r y 'personally to inspect a n y copy oI this Sul Huston J. m* any d o c u m e n t s relating. to tho 'l'rusl at the principal office of a n y corporate Trustee hereof tt but .shall not he hound to g i v e any further, information to a n y B e n e f i c i a r y r e lating to the affairs of the Trust or to permit a n y Beneficiary to ma.:ke a n y copies of any documents relating to the Trust .15. *i T HIS Settlement is made under the laws of the . Cayman Islands and the r i g h t s of a l l parties and the construction and effect of e a c h a n d every provision hereof shall be subject to the escclusive jurisdiction of and construed only a c c o r d i n g t o the laws of the Cayman Islands wh ich s h a l l be the for u m f o r the administration of t h i s • Trust P R O V I D E D how e v e r t h a t the Trustees m a y from time to time during the Accumulation Period b y deed declare that this T r u s t and the rig h t s of all parties and the construction and effect of the p r o v i s i o n s hereof shall f r o m the d a t e of such d eclaration be s u b j e c t to the exclusive jurisdiction of and construed only a c c o r d i n g to the laws of some other jurisdiction (other than t h e C a y m a n Islands) in which one or more of the Trustees t h e n serving in office is resident and that the f o rum for t h e administration of this T r u s t shall thenceforth be s u c h o t her jurisdiction PROVIDED . further that the T r ustees m a y not declare that this T r u s t and the rights of all p a r t i e s and the construction and effect of the provisions hereof shall be subject to the jurisdiction of and c o n s t r u e d according to the laws of a ^ a 8 g T w e n ty j u r i s d i c t i o n w h i c h would cause a material c h a n g e in the v r ights of the Beneficiaries hereunder or w h i c h w o u l d not r e c o g n i s e the validity of this Trust if s u c h non-recognition w o u l d r e s u l t in the revocation or t e r m i nation of the Trust 16. *• ‘ A N Y person of full age to w h o m or for w h o s e b e n e f i t a n y capital or income may be liable t o be appointed t r a n s f e r r e d paid or applied b y or in c o n s e q u e n c e of a n e x e r c i s e of any power or discretion vested in the Trustees or i n a n y o t her person m a y b y deed r e v o c a b l y o r irrevocably ** , d i s c l a i m h i s interest as a n object of s u c h p o w e r or discretion. t *• •• e i t h e r w h o l l y or w ith respect to any s p e c i f i e d part or share of s u c h c a p i t a l or income and then s u c h p o wer or discretion shall (despite anything contained el s e w h e r e i n this Deed) p r o t a nto c e ase to be exercisable' IJf W I T N E S S w h e r e o f the said Elizabeth Love has set h e r hand a n d s eal a n d the Common Seal of Guinness M a h o n Cayman T r u s t L i m i t e d has b e e n hereunto affixed the d a y and year first above written THE FIRST SCHEDULE One Hundred Pounds Sterling ^ . (£100.00) • T H E SECOND SCHEDULE / .. Page Twenty-One TBS ?• 1. SECOND . SCHEDULE T h e Settlor E l i z a b e t h Love of "Clanricarde", i B l a ckxock Soad, Cork, Ireland and her husband or w i d o w e r and issue (of whatever degree) and h er b r others and sisters and their issue (of w h a t e v e r degree) and the brothers and sisters of her hus b a n d a n d their issue (of w h atever degree) 2 • . . J o c a l .. Invest-tents H a l t e d SIGHED S E A L E D a n d D ELIVERED b y the a bove-named in the presence of: S. ,-T. ._ >— -'*• v"} — \\ «v>.v< v— '— ■ — — 9 — THE COMMON SEAL OP GUINNESS MHON CAYMASnjRUST LIMITED has been hereunto affixed in the presence yfaf: . ( < ( < ( ( ( ( y \ A s ^ ~ e-fo/2. i f T Ms. Noreen M ackey B.L., Mr. M ichael C. Cush S.C., O ffice o f the Inspectors o f Ansbacher (Cayman) Ltd., 3ld Floor, Trident H ouse, Blackrock, Co. Dublin. R E G IS T E R E D P O S T B y Fax and Post 01-283 3929 nuh* \nur rt-frren<■e 7 D ecem ber, 2001. RE: Our reference C /L 05/N M C Q H \JM \000025\20036 J . C L A Y T O N L O V E JN R . Dear M s. M ackey & Mr. Cush, W e refer to the draft preliminary conclusions notified b y you under cover o f letter dated 20 N ovem ber 2001. At the outset, w e are concerned that your preliminary view is som ewhat at odds with the docum entation exhibited by you and upon w hich you state to rely. A t the core o f our concern is the fact that, unlike Y ale Securities Limited, Mr. Joseph Clayton Love Junior never held any account with Ansbacher. 1. Under the terms o f the Order o f 22 September 1999 as subsequently amended by the Order o f 8 Decem ber 2000, the Court has appointed you and your colleagues under Section 8 o f The Com panies A ct 1990 to investigate and report on the affairs o f the com pany and in particular to define the nature and extent o f the Irish business o f Ansbacher (Cayman) Lim ited (“Ansbacher”) from 1971 to date. The Order provides that this relates to the business carried on by Ansbacher whether in the State or otherwise on behalf o f Irish residents; whether the affairs o f Ansbacher were conducted with intent to defraud its creditors or the creditors o f any person or otherwise for a fraudulent or unlawful purpose. It is accepted that the scope o f the Order is sufficiently broad to encom pass the nature o f the business which w as carried on by Ansbacher in the State, brief particulars o f w hich are described in the Report o f the Trinunal o f Inquiry (Dunnes Payments). H owever, Mr. L ove has not w as not involved in such. 2. It is submitted that you are obliged to com ply with the rules o f natural justice when you are about to make a determination on an issue w hich adversely affects our client. 3. The preliminary conclusion that Mr. Love w as a client o f Ansbacher is not true and further is not supported by any evidence. The contrary is the position. The only evidence is to the effect that Mr. Love w as not at any stage a client o f Ansbacher. 000025/20036/4903 nar K O IIluiIhii H'I.i.m: Ku\tn.. >hanaliattmi.i.iii.\m Jcnnm- 0 St)Iliv;ni ■ - - M a r i i - . l . i n . - l i a n lli.l. D rir.lr.- C l.-iilii In .I.M l G illia n M K in lin e lll.n c i, l.iza Patrick J Hrmllry ItConun.I.I.H.A1TI M a lu m -) IICL.I.I.M C lia rlfl H rnnrsay SIA C u n s u l l u n t th«international-network oimd«p*nd«ntiawy«« VAT no. IE 0425278R Mr. Love was instrumental in ensuring that the Elizabeth Love Trust w as established on 23 April 1971. That Trust ow ned Y ale Securities Limited (“Y ale”). Y ale advanced m onies to Mr. Love from time to tim e over the years. In paragraph 3 o f your preliminary conclusion these advances are referred to as “ borrowings ”. It is not understood w hy the word borrowings is described in this fashion. The sworn evidence which you have is that Yale made advances to Mr. Love at his request. Mr. Love has already advised that no m onies were received from the Trust, but rather from Yale Securities Limited. To this extent, you m ight amend paragraph 3 o f your recitals. Contrary to the assertion that “to date he has not made any repayments ”, Mr. Love has in fact repaid all m onies advanced by Y ale to him. Mr. Love furnished a statement on 24 March 2000 and subsequently a clarification statement on 24 M ay 2000. Subsequently, all o f Mr. L ove’s indebtedness to Yale com prising both principal and interest was repaid by him in or about August 2000. In relation to paragraph 2 o f your recitals, w e w ould appreciate i f you m ight clarify that the source o f the m onies w as from U.K . property transactions. In this context, w e refer you to Clause 6.2 o f Mr. L ove’s statement. The expression that Mr. Love w as a “client o f Ansbacher” is both am biguous and, w e suggest, incorrect. A client o f a Bank is generally understood to m ean a depositor or a borrower or perhaps a person w ho otherw ise is provided with banking services for consideration. Mr. Love w as not a borrower o f Ansbacher. H e w as a borrower o f Y ale Securities Limited. Mr. Love does not and never has held m onies with Ansbacher. H e has never borrowed m onies from Ansbacher and he has not retained Ansbacher to provide banking services. , Your investigation has been conducted in an atmosphere o f intense m edia com m ent and reporting, the effect o f w hich is that the Ansbacher depositors should be “named and shamed”. Your Report w ill no doubt have the effect o f causing considerable damage and loss o f reputation to those named therein as having been depositors in Ansbacher or otherw ise clients o f that bank W hile you will, pot .have any control or influence on the manner in w hich your Report w ill be publicised, you w ill appreciate that it w ill enter the public dom ain shortly after its conclusion. W hile not directly relevant to your conclusions, w e are aware that the Elizabeth Love Trust has been wound up. Your preliminary conclusion is also stated to be based on a memorandum prepared for the Moriarty Tribunal by the late Mr. Hugh Coveney. Y ou w ill appreciate that our client know s nothing o f this memorandum. H e has had no involvem ent in its preparation. In this memorandum the late Mr. Coveney, w ho w as a businessm an and lo t a lawyer, is reported to have stated that Y ale represented the interest o f Mr. Love in the Lynbrette Trust. I w ould respectfully draw your attention to the follow ing:- vv n ■ 0 () N i 1 V A .N : : . i " I ' 0 . 1 3 i. The opening sentence of recital number 4 is prejudicial to our client, insofar as it suggests that Mr. Love did not disclose the circumstances relating to the development near Phoenix, Arizona, U.S.A. ii. The late Mr. Coveney died in March 1998. He has not given any evidence to you. The memorandum is second hand hearsay. There is no evidence available to you from the late Mr. Coveney. We know nothing of the circumstances nor background to the furnishing by the late Mr. Coveney of the memorandum to the Moriarty Tribunal. That memorandum does not constitute evidence to you. It is certainly the case that you may not rely upon that document in the face of sworn evidence which contradicts it. Mr. Love has confirmed that Lynbrette was a Trust wherein Yale invested with others in a property venture in the United States. Businessmen such as the late Mr. Coveney and indeed his partners in the venture might well have understood that Yale “represented Mr. Love”. However there was no evidence or legal basis for that view and that view is mistaken. iii. It is surprising that you would seek to rely upon a document of this nature when the other parties to Lynbrette are alive and capable of giving you sworn evidence. Have you examined Mr. Collins, Mr. Boland or Mr. Dineen? Presumably they have not given you evidence to indicate that Yale “represented the interests of Mr. Love” in the sense that Mr. Love was the legal or beneficial owner of Yale, and presumably, you have been unable to obtain any evidence to corroborate the assertion. Why therefore is reliance placed on a document prepared for the Moriarty Tribunal when Mr. Love has given sworn evidence to the effect that at all times in the Lynbrette transaction he represented the interests of Yale,. That is z- perfectly understandable and, we would suggest, normal position when one is dealing with a family Trust. 7. We enclose:- ^ /-N ' i. Affidavit of Joseph Clayton Love Junior. We should be obliged if you would please confirm that you will liter your preliminary conclusion which, as stated, is untrue and has not been substantiated by evidence. Insofar as Mr. Love is concerned, he would not have a difficulty in a conclusion that:“ Yale Securities Lim ited was a client o f Ansbacher. The Elizabeth Love Trust was the legal and beneficial owner o f Yale Securities Limited, which company made advances to M r. J. Clayton Love Jnr. over a number o f years. These advances have been repaid in f u ll with interest by M r. Love. Yale Securities Lim ited was a client o f Ansbacher. ” For eas; of reference, we enclose marked up version of your draft and look forward to hearing further from you. If it would be of assistance, we would be prepared to meet with you to clarify any detail. J W O ’D O N O V A N SO L I Cl T O R S Should you, notwithstanding the foregoing, decide not to alter your preliminary view to reflect the foregoing, we confirm that we require to cross examine any witness on whose evidence you may rely, examine any document available to you and make oral submissions on these issues before you complete your report. IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED, AND IN THE MATTER OF THE COMPANIES ACT 1990, SECTION 8. AFFIDAVIT OF JOSEPH CLAYTON LOVE I, JOSEPH CLAYTON LOVE, of Tanglewood, Currabinny, in the County of Cork, Company Director, aged 18 years and upwards make Oath and say as follows: 1. I make this Affidavit from facts within my own knowledge save where otherwise appears, and where so appearing I depose to the same believing the same to be true. 2. I beg to refer to the Preliminary Conclusion of the Inspectors notified to me by letter of 20 November 2001. That conclusion states: “Mr. Love was a client o f Ansbacher". 3. This conclusion is not true. Furthermore, it suggests that I held monies in Ansbacher, or otherwise benefited from a scheme to unlawfully evade the payment of taxes to the State, and thereby commit a criminal offence. 4 . 1 have deposed to the fact that I borrowed monies from Yale Secuities Limited, an asset of the Elizabeth Love Trust. I say and believe that this does not constitute me to be a client of Ansbacher. Contrary to what is asserted in the Preliminary Conclusion, I have repaid all monies advanced to me by Yale together with interest. That repayment was made in August 2000 from monies legally and beneficially owned by me and held in the State. 5 .1 have never received a distribution from the Elizabeth Love Trust. 6. In so far as the Inspectors appear to rely on a memorandum prepared by the late Hugh Coveney which deals with the Lynbrette Trust, I say that Yale Securities Limited was one o f the investors in that venture, as set out previously at paragraph 6.8 of my statement of 6 March 2000.1 say that Yale Securities Limited did not represent my interests, rather the converse. 7. I further say that I was never the legal or beneficial owner of Yale Securities Limited. SWORN by the Deponent this day of December 2001 at Carrigaline, County Cork, before me a Practising Solicitor, and I SUBMISSIONS ON BEHALF OF MR. CLAYTON LOVE MADE BY MR. O'HANLON, SOLICITOR ON WEDNESDAY, 20TH MARCH 2002 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MS. N. MACKEY BL MR. M. CUSH SC Solicitor to the Inspectors: MS. M. CUMMINS Submissions on behalf of Mr. Clayton Love: MR. C. 0'HANLON SOLICITOR J.W. O'DONOVAN & CO SOLICITORS 1 SUBMISSIONS BY MR. CORMAC O'HANLON, SOLICITOR ON 2 BEHALF OF MR. CLAYTON LOVE, COMMENCED AS FOLLOWS ON 3 WEDNESDAY, 20TH MARCH 2002: 4 5 MS. MACKEY: Good morning, Mr. O'Hanlon. 6 7 I am Noreen Mackey and this is Mr. Cush. 8 MR. O'HANLON: Good morning to you. 9 I recall from the last 10 time. 11 here on the last occasion. 12 MS. MACKEY: Mr. Cush was not We have come along this morning really to hear 13 14 your submissions or to hear your speaking about your 15 written submissions. 16 listen to you. 17 very end and then we can ask you questions that 18 might arise or we can engage with you as we go 19 along. 20 MR. O'HANLON: What we propose to do is If you wish, you can wait until the 21 You deal with it as you see fit. 22 MS. MACKEY: Whichever suits you. 23 MR. O'HANLON: I have prepared a 24 very brief note which is 25 very largely repetitious. 26 sure that there is an awful lot to be said for going 27 through this line by line. 28 really I think it is important to begin at the 29 beginning so to speak -- as to what the High Court In a sense I am not too The first item -­ 1 order appointing you requires you to do: 2 to me that the raison d'etre of this inquiry was 3 essentially that the company was carrying on a 4 banking business in the State without a banking 5 licence. 6 surprise and shock arising out of the McCracken 7 report and the extent indeed of the business carried 8 on by Ansbacher in the State clearly on behalf of 9 Irish residents. It seems This was obviously a matter of great That so to speak is the 10 background. 11 obviously your enquiries are directed. 12 what the order focuses the attention on, namely the 13 extent of the business carried on by Ansbacher in 14 this State for Irish residents or indeed elsewhere 15 for Irish residents. That is the canvass upon which That is 16 17 Turning to the actual facts, the facts seem to me to 18 be largely accepted by you on the basis of the 19 preliminary conclusions which you have drawn. 20 It is a matter of interpretation in one or two 21 specific instances. 22 those were: 23 Elizabeth Love Trust but there is no doubt but that 24 he was the instrumental party in having the 25 Elizabeth Love Trust established. 26 it was not tax evasion or indeed tax avoidance. 27 There may have been an element of tax avoidance. 28 But primarily because of his apprehension of 29 financial difficulties he was advised to do it. But just to go back on what Mr. Love was not the settlor of the The purpose of 1 He thought it a good idea. 2 advice and he did it. 3 know after the last occasion, got the trust 4 document. 5 would expect a document of this nature to be. 6 It is not the form of document which I rather 7 suspect you may have seen here dealing with other 8 parties. 9 document. He sought professional We have eventually, as you The trust document I suspect is as one It is a properly constituted trust 10 11 The funding of the trust was from external assets. 12 In other words, there was no question of assets 13 generated within the Irish State being chanelled to 14 initially Jersey but later to Cayman. 15 1 Q. MR. CUSH: This is all the Elizabeth 16 17 Love Trust? A. MR. O'HANLON: 18 All of the Elizabeth Love Trust, yes. 19 Mr. Love himself and essentially his family -- the 20 potential beneficiaries are the wider family, 21 Mrs. Love's spouse, children, brothers, sisters, the 22 normal potential family beneficiaries. 23 event there has been one distribution from that 24 trust. 25 August 2000. 26 2 Q. 27 A. 28 29 In the In other words, it was largely wound up in MS. MACKEY: That is the distribution? MR. O'HANLON: Yes, that is the distribution. 1 trust. 2 so it was the engine by which wealth was to be 3 created. 4 relation to the advances made to him. 5 advised firstly that there was no circumstance in 6 which he could get a distribution from the trust 7 because it would be subject to tax. 8 borrowed money from the trust it had to be subject 9 to interest. It was the wealth generator of the trust, You may recall Mr. Love's evidence in He was If he had He received advances, small advances 10 I think initially. 11 over the first 10 or 15 years the advances were 12 small but later more substantial. 13 evidence in relation to that. 14 evidence in relation to the methodology by which it 15 was done, all essentially via Mr. Traynor. 16 asked for written documents in relation to that. 17 Loan agreements, what one might call standard 18 banking documentation. 19 no such documents. 20 say not terribly surprising. 21 If one were advising the trustees, one might say 22 'You shouldn't be doing it this way.' 23 now looking back at what was done maybe five, ten, 24 twenty years ago, and they didn't do it that way. 25 But he was told 'If you want an advance from the 26 trust through Yale, it will be done this way' and 27 the money was made available to him. 28 repay the money and in the event has repaid all of 29 that money plus interest. And indeed from recollection, He has given He has given You It isn't there; there are Is that surprising? I would It is a family trust. But we are He had to The amount of that was 1 very substantial. 2 accounts. 3 furnished to Mr. Love, they were furnished to his 4 daughter who was the ultimate beneficiary. 5 they give you an idea of the magnitude of what you 6 are looking at. 7 3 Q. I think you have seen the These accounts incidentally were not MR. CUSH: 8 But Did Mr. Love not seek these accounts? 9 A. 10 4 Q. 11 A. MR. O'HANLON: He sought the accounts. MR. CUSH: They weren't provided? MR. O'HANLON: They were not provided to 12 him. From recollection, 13 the only account he said he ever saw through the 14 years of the advances was a memorandum account or a 15 statement. 16 5 Q. MR. CUSH: 17 18 Statement of affairs from Mr. Traynor? A. MR. O'HANLON: 19 Exactly. Specifically in fact I was looking for 20 those because I thought that would be of 21 considerable value to us if we had those, but we 22 don't have them and he doesn't have them. 23 all that was ever done was that he was shown a copy 24 of a statement or a memorandum account. 25 26 27 28 29 6 Q. MS. MACKEY: He said On what basis did they provide them to his daughter and not to himself? 1 7 Q 2 here we just have a group or class of potential 3 beneficiaries. 4 any special way? 5 A MR. O'HANLON: 6 She is not particularly named in But the structure of the trust is essentially 7 discretionary within a class. 8 distribution within the class and that is the end of 9 it. 10 8 Q MS. MACKEY: 11 12 The trustees made a They made them to her you mean? A MR. O'HANLON: To her. She was the beneficiary. 13 So the 14 trust has in fact been wound up. 15 has been made and the distribution was August 2000. 16 9 Q MR. CUSH: 17 18 The distribution The accounts were provided to her then? A MR. O'HANLON: 19 Accounts were then provided to her because 20 there was a tax calculation in relation to that 21 distribution. 22 10 Q MR. CUSH: 23 And that is a matter for her. But there is no reason why accounts wouldn't be 24 provided before? 25 A 26 11 Q MR. O'HANLON: To? MR. CUSH: To anyone in the class of 27 beneficiaries ? 28 A 29 12 Q MR. O'HANLON: Wrong, no. 1 2 3 4 important. I can set up 5 a trust today and I can name everybody in this room 6 as a potential beneficiary, but you are entitled to 7 absolutely nothing. 8 beneficiary until such time as the trustees say 9 'Right, here is the distribution to you.' You are a potential You then 10 have a right from that moment on, but before that 11 you are only a potential beneficiary. 12 13 Q. MS. MACKEY: 13 But what about the person who in fact was the mover, 14 the motivating person, Mr. Love, who was able to 15 obtain loans. Was he not entitled to some 16 documentation? How did he become entitled to get a 17 loan? 18 A. MR. O'HANLON: 19 Can we move one step back first of all. When you 20 say the prime mover - he is not the settlor, 21 Mrs. Love was the settlor of this trust. 22 said, of course he was instrumental in setting it 23 up. 24 14 Q. 25 A. MS. MACKEY: What do you mean by that? MR. O'HANLON: It was he who had it 26 established. 27 who sought advice, got advice. 28 was the protection of his family. 29 15 Q. That MS. MACKEY: It was he The purpose of it They were his funds? 1 2 No, they were not his funds. 3 ever ended up in this trust. 4 16 Q MS. MACKEY: 5 6 No monies of his have Whose funds were settled on it? A MR. O'HANLON: 7 They were settled on various companies. 8 You may remember UK Investments. 9 were actually held by companies which in turn were 10 held by Yale which in turn were held by the trust. 11 17 Q MS. MACKEY: 12 Those companies Who was the ultimate owner of those funds, the 13 ultimate beneficial owner of the funds that I am 14 talking about? 15 A 16 18 Q 17 A MR. O'HANLON: The very first funds? MS. MACKEY: Yes? MR. O'HANLON: You may remember in the 18 statement -- we can go 19 back through it if you wish -- that with the very 20 first funds there was a trust in the Channel Islands 21 which was his trust, the Clayton Love Channel Island 22 Trust. 23 Mrs. Love I think had a trust -- I may be mistaken 24 in that -- in the Channel Islands as well. 25 was an initial figure of something like £50,000 or 26 £70,000 which was generated from profits in the UK 27 on foot of some property transaction. 28 simply in the Channel Islands and those monies were 29 moved from the Channel Islands to the Cayman Those funds came across to Cayman. There Those were 1 2 19 Q 3 Mrs. Love's originally 4 5 looking at the thing realistically? A MR. O'HANLON: mean? 6 7 20 Q MS. MACKEY: 8 9 A M R . O' HANLON: the answer may not be. 12 21 Q 13 A 14 22 Q Legally the company? M R . O' HANLON: Yes . MS. MACKEY: But who was the ultimate beneficiary of the company 16 if you like? 17 M R . O' HANLON: 18 statement, Exhibit I. 20 It says: 25 26 27 28 29 May I turn to paragraph 5.4 of his original 19 24 . (INTERJECTION) MS. MACKEY: 15 23 Does that mean legally because if it is legally 11 22 Who really owned the funds ? 10 21 What does "realistically " I will read it to you. "In the events I identified some interesting opportunities in London in association with GMPC [Guinness Mahon Property Company] and we began assembling a site for a major office development in the Whitechapel area of London. A large number of interests had to be acquired and many of these were surplus to our needs. It was nevertheless important for us to buy in these interests so as to develop the site. This acquisition took a number of years to achieve. Interests which were surplus to requirements were disposed of and this resulted in the generation of profits of circa £75,000/£80,000 to which I will refer later." 1 2 3 M S . MACKEY: I think that answers the 4 question I was trying to 5 get at. 6 asked you first, which started off this train of 7 thought. 8 mover. 9 originally? 10 A We have moved away from the question I Mr. Love was, I used the phrase, the prime But he was the motivating force MR. O'HANLON: I think prime mover is 11 actually fine. 12 13 He was the wealth generator. 24 Q MS. MACKEY: The wealth generator. 14 That is a good phrase. 15 He was the wealth generator and in those 16 circumstances allied to the fact that the trustees 17 saw fit to make loans to him, was he not entitled to 18 get statements? 19 A MR. O'HANLON: Statement of indebtedness, 20 21 yes . 25 Q MS. MACKEY: But statements of affairs, 22 statements of accounts 23 24 such as these? A MR. O'HANLON: No. 25 matter for the trustees 26 and I cannot answer it. 27 a statement. 28 MR. CUSH: 29 That really is a He didn't. He was shown He didn't question it. I don't think he knew who 1 2 3 he said he didn't. 4 he knew and you may remember his answers. 5 event he was wrong in a number of respects. 6 anyway the trust document was later obtained. 7 And that shows the position because there was a 8 question, 9 wondering whether there was a question of He gave evidence as to whether In the But for example, from Judge Costello who was 10 accountants being the settlors effectively, which 11 again one has read about as being an unusual 12 mechanism which was adopted apparently in a number 13 of similar transactions. 14 that to show that that was not the methodology used 15 here. 16 one would normally expect in the establishment of a 17 trust. 18 27 Q And the methodology used here was one which MR. CUSH: 19 perfectly properly constituted trust? 21 A 22 28 Q MR. O'HANLON: Correct. MR. CUSH: Where some of the concern 23 arises is as to its 24 operation and particularly to the borrowing? A MR. O'HANLON: 26 27 28 29 On the face of it, it would appear that it is a 20 25 I am simply adverting to Indeed and whether there were borrowings at all. 29 Q MR. CUSH: And whether they were real borrowings at all? 1 acid test. 2 with interest. 3 £40,000 or £50,000 or £100,000. 4 his own sworn evidence. 5 advert to his own evidence in relation to his 6 friendship with Des Traynor. 7 about people there who go way back when, very close 8 friends. 9 You may recall in his statement the family They have repaid, they have been repaid We are not talking about £20,000 or This is on top of You see, I am reluctant to But you are talking Des Traynor was his business adviser. 10 background was a particularly unhappy, 11 background. 12 at a young age in life contrary to popular belief 13 with the golden spoon in the mouth and so on. 14 It wasn't like that; he actually left the business 15 but quite quickly was a success. 16 the insecurity of the self-employed, and the 17 insecurity is real. 18 of that. 19 this. 20 avoidance point of view very clever but he was 21 advised that it was perfectly legitimate provided it 22 was not effectively funded from assets within the 23 State. 24 to him because if they were he would simply have to 25 pay tax on the distributed income as it came into 26 the State. 27 not have been in its operation. 28 been perfect. 29 dotted every "i" or crossed every "t" but this is fractious Well known but particularly fractious But thereafter He was particularly conscious He gave that as the raison d'etre for It may have been clever. From a tax And furthermore, no distributions were made That is the way it was set up. It may It may not have It may not have followed every line, 1 the way it was done. 2 looking back at a situation and looking at it I 3 suppose in association with other people whose 4 affairs are certainly not known to me but would be 5 known to you. 6 frankly to many of those. 7 similarities with others, I don't know. 8 have been, I rather suspect, that you have common 9 advisers. We are now many years later I suspect it is quite dissimilar There may be It may But you may recall his own evidence in 10 relation to what he knew or didn't know of 11 Des Traynor, and they were very, very close friends. 12 Hugh Coveney was a particularly good friend of his. 13 He said he was not aware that Des was an adviser to 14 Hugh Coveney. 15 of the relationship between the two. 16 Traynor 'Here is a statement. 17 there. 18 him. 19 30 Q. That tells you a little something And if Des This is what is This is what you owe' that was enough for MR. CUSH: Is that what the 20 statement of affairs 21 showed? 22 he got statements of affairs maybe once a year on a 23 blank sheet of paper. 24 reading the transcript that it was a pretty informal 25 presentation? 26 A. We have evidence from Mr. Love saying that MR. O'HANLON: 27 One got the impression from I took it from that to be an extremely informal 28 presentation. I wasn't entirely clear as to 29 whether, for example, it meant what you and I might 1 understand to be a statement of affairs, as in 2 assets, liabilities or whatever. 3 bank account. 4 trust and what its obligations were and fees were or 5 something like that. 6 these people are paid every year. 7 that nature but I am not entirely clear about it. 8 31 Q It may have been a It may have shown the extent of the Presumably these trustees and MR. CUSH: Something of Is there evidence to 9 demonstrate that the 10 statement of affairs such as it was showed the 11 borrowing by Mr. Love? 12 A MR. O'HANLON: I cannot say that that is 13 the position because he 14 didn't say it was. 15 transcript. 16 32 Q 17 A He didn't say it was in the MR. CUSH: I don't think he did? MR. O'HANLON: That is my point and 18 therefore I cannot say 19 that he did. 20 documents was extremely hazy. 21 33 Q MR. CUSH: 22 23 He was very straight about it? A MR. O'HANLON: 24 Extremely hazy so I cannot say the answer to that is 25 26 His recollection of what was in those yes . 34 Q MS. MACKEY: 27 To get a few dates straight in my own head, 28 Mr. O'Hanlon. The trust was wound up on that final 29 distribution. That distribution that you mentioned 1 2 3 35 Q MR. O'HANLON: August 2000. MS. MACKEY: The repayment of the loan 4 was made when? 5 A 6 36 Q MR. O'HANLON: At or about that time. MR. CUSH: Sometime post September 7 8 1999, before August 2000? A MR. O'HANLON: Exactly. 9 was here and prior to the 10 11 winding up. 37 Q MS. MACKEY: But you don't have the 12 13 It was after he exact date? A MR. O'HANLON: I don't have the exact 14 date but I can provide the 15 exact date. 16 exact date on which the monies were paid. 17 know it is between those two dates. 18 38 Q It would be very easy to provide the MR. CUSH: 19 The statements of affairs that he got from 20 21 Mr. Traynor, he didn't keep those? A MR. O'HANLON: 22 No, he didn't because of course that would have 23 been extremely useful. 24 back how many years? 25 them. 26 other than the most recent accounts. 27 keep records of that nature. 28 29 But I But again, one is going But again he just doesn't have In fact he didn't have anything frankly He doesn't 1 I understand now that they were provided to Mr. 2 Love's daughter? 3 A. 4 4 0 Q. MR. O'HANLON: Yes. MR. CUSH: What do you know about the 5 intervening years 6 7 preparation of accounts. A. MR. O'HANLON: We don't know. 8 9 41 Q. MR. CUSH: And you got them this year. 11 A. M R . O' HANLON: Of course there is, exactly. 42 Q. MR. CUSH: That might suggest that 15 previous years have been 16 17 There is obviously a previous year? 13 14 We asked for accounts in fact. 10 12 Were they even prepared? prepared. A. It might? MR. O'HANLON: 18 For example, if it is a limited liability company, 19 one would assume that the company had to be audited 20 every year. 21 43 Q. 22 A. MR. CUSH: It should have been. MR. O'HANLON: I don't know what the 23 obligation in the Cayman 24 is in relation to these matters but one would assume 25 that it was. 26 that has not been made available to us. 27 had asked for this, but frankly any enquiry of that 28 nature simply went into the sand. 29 Unfortunately, this is the only thing Mr. Love 1 as a matter of course once 2 3 the distribution was made or did she ask for it? A. MR. O'HANLON: No, it was actually 4 provided, Exhibit II. 5 45 Q. 6 A. 7 4 6 Q. MS. MACKEY: It was sent to her? MR. O'HANLON: It was sent to her. It is not signed, MS. MACKEY: 8 9 Exhibit II? A. MR. O'HANLON: I noticed that. 10 You will notice it is 11 12 unaudited. 47 Q. MR. CUSH: The difficulty really is 13 that there are a number of 14 indications that the assets of the trust were being 15 treated by Mr. Love as a loan if they are not 16 borrowings ? 17 A. MR. O'HANLON: If they are not 18 borrowings. You see, it 19 is a huge jump to say that they are not. 20 if I was sitting where you are sitting, that would 21 be my immediate suspicion. 22 48 Q. MR. CUSH: 23 testimony. 25 as a loan? 26 A. 27 4 9 Q. 29 On the one side we have Mr. Love's sworn 24 28 I am sure We have these accounts which show them MR. O'HANLON: You have the repayments. MR. CUSH: And we have repayment. So they are the three indications that they were borrowings? 1 2 against that is what I 3 might call the informality of the availability of 4 the funds. 5 50 Q MS. MACKEY: 6 7 time? A 8 9 MR. O'HANLON: And the long period of time . 51 Q MS. MACKEY: 10 11 And the long period of The very long period of time. A MR. O'HANLON: 12 It is a very long period of time. But then again, 13 why is that surprising? 14 creator which indeed he was. 15 the advancing of funds to him was ultimately to 16 benefit the trust, which it was. 17 worked out that way of course. 18 the respective trustees you might have a very 19 different view 20 52 Q MR. CUSH: 21 If he was the wealth If the net effect of It mightn't have Again, if you were No trustee acting properly should make advances from 22 the trust on no terms it would appear, whether terms 23 as to repayment..(INTERJECTION)? 24 A MR. O'HANLON: 25 Terms were agreed as to repayment. 26 You mean as to fixed interest or a fixed time period? 27 53 Q 28 A 29 54 Q MR. CUSH: Yes. MR. O'HANLON: Absolutely MR. CUSH: What were the rates of 1 2 3 4 1.5% above d e p o s i t r a t e . 55 Q. MR. CUSH: That i s what has been 5 6 done? A. MR. O'HANLON: 7 No, t h a t was th e agreement and t h a t was h i s sworn 8 evidence as w e ll . Again, h i s t o r i c a l l y , I s uspe ct 9 i t was re a s o n a b ly generous f o r the 1970' s , but then 10 a gain h i s own evidence was t h a t we have a l l 11 f o r g o t t e n t h a t in times of h y p e r - i n f l a t i o n t h a t 12 e q u a l l e d 17% a t v a r io u s times and when b a n k s ' s 13 margins were more generous perhaps th a n t h e y are 14 toda y. 15 t r u s t e e s , t h a t t h a t i s not th e way you would s e t i t 16 up. 17 of the t r u s t was to a l a r g e e x t e n t p a r t and p a r c e l 18 of h i s a b i l i t y . 19 g e n e r a te p r o f i t i f he was s u c c e s s f u l . 20 a t r u s t in th e normal sense I suppose of a s i n g l e 21 s e t t l e m e n t and t h i s i s to be used i n p e r p e t u i t y f o r 22 t h e s e b e n e f i c i a r i e s or f o r s p e c i f i c p e r i o d s of time 23 or f o r s p e c i f i c b e n e f i c i a r i e s and f o r s p e c i f i c 24 p urp os es. 25 trust. 26 in AIB might give you £4 a y e a r . 27 with him might give you £50,000 i f s u c c e s s f u l . 28 You might l o s e i t j u s t as w e l l . 29 c o n te x t i t i s perhaps not e n t i r e l y s u r p r i s i n g . I ta k e th e p o i n t t h a t i f any of us were But then again, do c o n s id e r t h a t th e success In o t h e r words, th e t r u s t would This w a s n ' t He was the wealth g e n e r a t o r of the He was th e e n t r e p r e n e u r . I n v e s t i n g £100 I n v e s t i n g £100 Within t h a t 1 I t i s not e n t i r e l y surp. i s i n g because e f f e c t i v e l y 2 the b e n e f i t of th e adva: ces was t o g e n e r a te wealth, 3 as i t did. 4 56 Q 5 A MS. MACKEY: As th e b e n e f i c i a r y ? MR. O' HANLON: As i t a c t u a l l y did. But as I say, i t could 6 7 8 have been th e o t h e r way a ro u n d . 57 Q MS. MACKEY: Supposing Mr. Love had 9 been unable t o repay the loan? 10 11 A MR. O' HANLON: have a cause of a c t i o n 12 13 14 a g a i n s t him. 58 Q MS. MACKEY: But when would t h a t have 15 been a s c e r t a i n e d ? 16 17 Then the t r u s t e e s would There was no d a te by whi h he had t o repay i t ? A MR. O' HANLON: 18 Presumably th e l e g a l p o s i t i o n would be t h a t the 19 money would be repa yab le on demand. 20 a d v a n c e d . . . (INTERJECTION) 21 MS. MACKEY: The a c t u a l repayment - was 22 t h a t as a r e s u l t of a 23 24 25 I f monies are demand? A MR. O' HANLON: No, I d o n ' t b e l i e v e so. MR. CUSH: What about the d i s t r i b u t i o n t o the 26 27 da ughter? 28 t r u s t e e s e x e r c i s i n g a di c r e t i o n t o make t h a t 29 distribution? What evidence i f any, do you have of the MR. O' HANLON: 1 2 60 Q MR. CUSH: 3 But a p a r t from t h a t i s t h e r e any o t h e r 4 5 Yes. evidence? A MR. O' HANLON: No, but I can p rov ide you with an a f f i d a v i t I 6 7 presume from her? 8 61 Q 9 A MR. CUSH: Yes. MR. O'HANLON: Only to say she r e c e i v e d it. 10 But o t h e r than t h a t , 11 the t r u s t e e s h a v e n ' t given t h e i r i n t e r n a l 12 mach ina tions as to how th e y a r r i v e a t her and not 13 others . 14 62 Q MS. MACKEY: 15 How di d t h a t circumstanc e arise? Was t h e r e some 16 correspondence from the t r u s t e e s f i r s t saying 17 'We are now minded to make a d i s t r i b u t i o n ' or was i t 18 i n i t i a t e d from t h i s end or how di d t h i s suddenly 19 come about? 20 A MR. O' HANLON: 21 from t h i s end. 22 63 Q 23 A MS. MACKEY: What happened? MR. O' HANLON: I t simply c o u l d n ' t be 24 i n i t i a t e d from t h i s end. 25 64 Q 26 A 27 65 Q MS. MACKEY: So what happened? MR. O' HANLON: She r e c e i v e d i t . MS. MACKEY: Suddenly out of th e blue lik e that? 28 29 I t c o u l d n ' t be i n i t i a t e d A 1 2 I d o n ' t a c t u a l l y know p r e c i s e l y what she r e c e i v e d or 3 d i d n ' t r e c e i v e o t h e r than th e f a c t t h a t she r e c e i v e d 4 a distribution. 5 66 Q MS. MACKEY: with t h e s e s ta t e m e n ts ? 6 7 A 8 67 Q MR. O'HANLON: Precisely. MS. MACKEY: Presumably t h e r e was a l s o 9 a cover ing l e t t e r winding up the t r u s t or some such document? 10 11 A MR. O'HANLON: I d o n ' t know. I don't know what she got o t h e r 12 13 14 She has pro vid e d Mr. Love tha n the f a c t t h a t I know she got i t . 68 Q MS. MACKEY: 15 I f t h e r e i s , would i t not be r e l e v a n t t o our 16 i n v e s t i g a t i o n to have t h a t as p a r t of th e t r u s t 17 documents ? 18 A 19 69 Q MR. O'HANLON: C ertainly i f i t e x ists. MS. MACKEY: There must have been something coming to h e r. 20 21 She d i d n ' t get a cheque in th e p o s t and nothin g 22 else. 23 70 Q MR. CUSH: 24 Presumably some s o r t of a st a t e m e n t t h a t the 25 t r u s t e e s have de cided to make a d i s t r i b u t i o n to her 26 and here i s th e cheque or whatever? 27 MR. O'HANLON: 28 29 I d o n ' t know i s th e s h o r t 1 Would you mind making 71 Q enquiries ? 2 3 A 4 MR. O' HANLON: n o t. Not a t a l l , a b s o l u t e l y Of her? 5 72 Q MR. CUSH: Yes, of he r. 6 73 Q MS. MACKEY: Does she l i v e here? 7 A MR. O' HANLON: She does l i v e i n I r e l a n d . 8 74 Q MS. MACKEY: I t may be t h a t i t would be 9 n e c e s s a r y f o r us to 10 i n t e r v i e w he r and u l t i m a t e l y to f i n d out how the 11 t h i n g was wound up? 12 A MR. O' HANLON: 13 I can found out e x a c t l y what i s t h e r e and 14 15 Indeed. p ro vid e t h a t . 75 Q MS. MACKEY: 16 Any correspondence she r e c e i v e d i n r e l a t i o n to 17 th e winding up of the t r u s t or the d i s t r i b u t i o n 18 would be r e l e v a n t . 19 I f she had, f o r example, a te le ph on e c a l l from 20 Cayman or whatever, some communication made with 21 them. 22 76 Q MR. CUSH: 23 Or communications of any kind. And I suppose j u s t to be c l e a r , some c o n fi rm a ti o n 24 t h a t t h e r e i s no arrangement as between her and her 25 f a t h e r in r e l a t i o n to th e fund? 26 A MR. O'HANLON: 27 28 29 A b s o l u te l y . I can a s s u r e you t h e r e i s n ' t . that. I know a l s o been some d e c i s i o n on 1 2 the p a r t of th e t r u s t e e s as to why th e e n t i r e 3 d i s t r i b u t i o n was made to he r r a t h e r th a n t o . . . D o e s 4 she have b r o t h e r s and s i s t e r s a l i v e ? 5 A. MR. O'HANLON: She would have two brothers. 6 7 78 Q. 8 A. 9 7 9 Q. MS. MACKEY: S t i l l living? MR. O'HANLON: Yes, two b r o t h e r s . MS. MACKEY: And the o t h e r b e n e f i c i a r y i s l i s t e d here, the 10 11 mother. Is she s t i l l l i v i n g ? 12 MR. O'HANLON: 13 She i s a l i v e . would be I guess in h i s 14 mid 7 0 ' s . She i s s l i g h t l y o l d e r . 15 not good. She has Alzheimers. 16 Mr. Love 8 0 Q. MS. MACKEY: 17 Her h e a l t h i s There are her b r o t h e r s and sisters. There i s the 18 s e t t l o r , h e r s e l f , her husband Mr. Love h im s e lf and 19 t h e i r i s s u e which ta k e s in th e d a ug ht er . 20 her b r o t h e r s and s i s t e r s and Mr. Love's b r o t h e r s and 21 s i s t e r s and t h e i r i s s u e ? 22 A. 23 81 Q. 24 There are MR. O'HANLON: There i s th e wider family. MS. MACKEY: So t h e r e was q u i t e a l a r g e c l a s s of p o t e n t i a l 25 b e n e f i c i a r i e s , and in th e event i t a l l came to one. 26 I t was picked i t would seem almost a r b i t r a r i l y but 27 presumably t h e r e was some d e c i s i o n made? 28 29 1 2 82 Q MS. MACKEY: A b s o l u te l y . 3 wondering whether t h a t 4 would have been n o t i f i e d to her? 5 A 6 83 Q MR. O'HANLON: As to th e re aso n why her MS. MACKEY: Yes, why she h i t the 7 8 ja c k p o t as i t were? 84 Q MR. CUSH: Is t h e r e any th in g e l s e on 9 t h a t t r u s t t h a t you want 10 t o say to us. 11 about the Ly n b r et t e Trust? 12 But I am A You might want to say something MR. O'HANLON: 13 Ly nbre tt e was simply a venture, th a t is a l l i t 14 was. 15 This was one of th e u n s u c c e s s f u l ones as i t happens. 16 S i n g u l a r l y and s t a r t l i n g l y u n s u c c e s s f u l from 17 r e c o l l e c t i o n but i t was an u n s u c c e s s f u l v e n tu re . 18 I d o n ' t t h i n k t h e r e i s much more t o be s a i d about 19 t h a t u n l e s s you have some s p e c i f i c q u e r i e s about i t ? 20 85 Q I t was a no th er v e n tu re of Yale u n s u c c e s s f u l . MS. MACKEY: 21 was one of th e p o t e n t i a l 22 23 beneficiaries? A MR. O'HANLON: 24 argument about t h a t . 26 it, 27 understandably. 29 Yes. I t was a Yale venture. 25 28 You would agree t h a t Yale There i s no But ag ain, as we would see i t was th e co nfusion of Mr. Love and Yale 1 co n cl u s io n t h e r e , E x h i b it I I I ? 2 3 A. 4 87 Q. MR. O'HANLON: I do. MS. MACKEY: Would you look a t number 5 f i v e , th e most r e c e n t one where we t a l k about Yale. 6 7 A. MR. O'HANLON: You say: "A f u r t h e r Ansbacher involvement concerns a consortium formed t o c a r r y out a development near Phoenix, Arizona, USA. Upon th e advice of Mr. Des Traynor of GMI, a scheme was c o n s t r u c t e d in v o lv in g th e e s t a b l i s h m e n t of a d i s c r e t i o n a r y t r u s t , (the Ly n b r et t e Trust) of which GMCT was the T r u s te e . The Tr ust had as b e n e f i c i a r i e s f i v e Cayman companies. Four of t h e s e r e p r e s e n t e d th e i n t e r e s t s of fo ur of th e p a r t i c i p a n t s . The f i f t h company was Yale, and Mr. Love has informed th e I n s p e c t o r s through h i s s o l i c i t o r t h a t in the consortium he r e p r e s e n t e d th e i n t e r e s t s of Yale r a t h e r than th e converse. In view of the co n cl u s io n reached by the I n s p e c t o r s a t para grap h 4, the I n s p e c t o r s are of the view t h a t the i n t e r e s t s of Yale and th o s e of Mr. Love are i d e n t i c a l , and t h a t in f a c t he was a de f a c t o p o t e n t i a l b e n e f i c i a r y of the Ly n b r et t e T r u s t . " 8 9 10 11 12 13 14 15 16 17 18 19 20 21 What we say in r e l a t i o n to t h a t i s t h a t L yn br et te 22 was a c r e a t u r e of Yale. 23 88 Q. 24 A. MS. MACKEY: A c r e a t u r e of Yale? MR. O'HANLON: A c r e a t u r e of Yale. 25 Sorry, Yale was the 26 p o t e n t i a l b e n e f i c i a r y of th e su ccess of Ly n b r et t e or 27 f a i l u r e of L y n b r e tt e . 28 b e n e f i c i a r i e s of t h a t s u c c e s s . 29 involvement in Yale i s simply v i a th e E l i z a b e t h Love One of the p o t e n t i a l Mr. Love's 1 Tr us t as a p o t e n t i a l b e n e f i c i a r y . 2 we alth g e n e r a t o r f o r the E l i z a b e t h Love T r u s t/ Y a le . 3 8 9 Q. MS. MACKEY: But he was a To be c l e a r i n my own mind 4 as to the c on nec tio n between Ly nbre tt e and the 5 E l i z a b e t h Love Tr ust i n s o f a r as t h i s ve n tu re i s 6 concerned - - and indeed i t i s what happened. 7 Ly n b r et t e f a i l e d ; t h a t p r o p e r t y ve n tu re f a i l e d - ­ 8 Yale took th e f la c k ? 9 A. 10 90 Q. MR. O'HANLON: Correct. MS. MACKEY: Is i t th e case t h a t the E l i z a b e t h Tr us t took the 11 f la c k ? 12 13 A. MR. O'HANLON: 14 I t s a s s e t was reduced i n consequence of 15 16 E x a c tly . th a t fiasco. 91 Q. MS. MACKEY: 17 Is i t th e case then t h a t th e funds used i n the 18 Ly nb re tt e v e n tu re came from th e E l i z a b e t h Love 19 Trust? 20 A. 21 92 Q. 22 A. MR. O'HANLON: I t came from Yale. MS. MACKEY: Where d id Yale ge t them? MR. O'HANLON: Yale had them; I d o n ' t 23 24 know. 93 Q. MS. MACKEY: 25 26 th e t r u s t ? A. MR. O'HANLON: 27 I d o n ' t know. I presume Yale had funds from day 28 29 Did th e y borrow them from one . 94 Q. MS. MACKEY: 1 funds of th e E l i z a b e t h 2 Love T r u s t. 3 c o n te x t of th e E l i z a b e t h Love Trust? 4 MR. O'HANLON: 5 Is t h a t not what Yale i s doing in the Yes. Yale was simply a c r e a t u r e of th e E l i z a b e t h 6 Love Tr ust and i t used whatever funds were a v a i l a b l e 7 t o e i t h e r i n v e s t or advance. 8 an inve st men t. 9 95 Q MS. MACKEY: 11 A 12 96 Q MR. O' HANLON: Indeed, c o r r e c t . MS. MACKEY: And i t i n v e s t e d and i t did 13 v a r io u s t h i n g s ? 14 A 15 97 Q MR. O' HANLON: C orrect. MS. MACKEY: One of th e inve st me nts 16 t h a t was made was t h i s ? A MR. O' HANLON: 18 Was Ly n b r et t e, c o r r e c t . I d o n ' t t h i n k t h e r e i s any g r e a t area of c o n t e n t i o n in r e l a t i o n t o t h i s . 19 20 So i t h e ld a l l th e funds of th e t r u s t ? 10 17 So t h i s was t h e r e f o r e 98 Q MS. MACKEY: 21 There may not be c o n t e n t i o n but I want to 22 be c l e a r in my mind where Mr. Love comes i n t o t h i s . 23 As I u n d e rs ta nd th e whole L yn br et te scheme, a 24 consortium was formed to c a r r y out a development? 25 26 A MR. O' HANLON: Correct. MS. MACKEY: That comprised a c e r t a i n 27 number of American 28 businessmen and f i v e I r i s h businessmen, of whom one 29 i s Mr. Love? MR. O' HANLON: 1 No, Yale. w a s n ' t p a r t y t o i t , Yale 2 3 4 was the p a r t y to i t . 100 Q MS. MACKEY: To th e whole development; 5 Mr. Love was not p a r t y a t all? 6 7 A 8 101 Q MR. O' HANLON: No, Yale was p a r t y to i t . MR. CUSH: This i s why you say 9 t h a t Mr. Love r e p r e s e n t e d the i n t e r e s t s of Yale? 10 11 A MR. O'HANLON: E x a c tly . 13 to f a l l to Yale, not to Mr. Love. 102 Q MS. MACKEY: When you say t h a t he 15 r e p r e s e n t e d th e i n t e r e s t s 16 17 The su ccess or f a i l u r e of Ly n b r et t e was 12 14 Mr. Love of Yale, what do you mean by t h a t ? A MR. O'HANLON: I mean t h a t i n a sense he 18 was a mere t r u s t e e , t h a t 19 he was an agent f o r Yale. 20 gained. 21 personally. 22 being h o p e f u l l y th e wealth g e n e r a t o r or l o s s 23 g e n e r a t o r in t h i s i n s t a n c e f o r Yale, no more than 24 th at. 25 MS. MACKEY: 26 I f money was made, Yale I f money i s l o s t , Yale l o s e s not Mr. Love I t i s simply a n o th er a s p e c t of him But i s i t not perhaps an o th er i n d i c a t i o n of 27 Mr. Love's a b i l i t y in an i n d i r e c t fa s h i o n t o use the 28 funds of th e E l i z a b e t h Love Trust? 29 1 His m o t i v a t i o n i n a l l of 2 t h i s was to g e n e r a te wealth f o r th e E l i z a b e t h Love 3 T ru st f o r h i s family . 4 MS. MACKEY: 5 This i s simply p a r t of t h a t . But s u r e l y i n s o f a r as Yale as a c r e a t u r e of the 6 E l i z a b e t h Love Tr ust would be i n v e s t i n g or doing 7 v a r io u s t h i n g s , i t would be th e t r u s t e e s who would 8 be doing th e i n v e s t i n g ? 9 a c t i n g as some kind of agent f o r th e t r u s t , in f a c t d e c id i n g on an inve st men t, r i s k i n g funds? 10 11 Here we have Mr. Love A MR. O'HANLON: But you see, t h a t i s not th e way i n f a c t . 12 13 The t r u s t e e s e f f e c t i v e l y would make advances to 14 Mr. Love. 15 105 Q MS. MACKEY: 16 Was t h i s an advance they made? I am lookin g now 17 a t t h i s investment i n t o th e Ly nb re tt e scheme which 18 on your submission i s an investment made by Yale? 19 A 20 106 Q MR. O'HANLON: Yes. MS. MACKEY: And Yale i s th e company 21 t h a t runs th e E l i z a b e t h 22 Love fund? 23 A 24 107 Q 25 MR. O'HANLON: Yes. MS. MACKEY: The whole purpose of the t r u s t e e s of th e t r u s t are 26 t o manage th e funds, to ensure th e y are p r o p e r l y 27 i n v e s t e d , to do a l l the running of them and so on. 28 And t h e r e f o r e , i f any of th e Yale funds were to be 29 used in such a scheme, I would have thoug ht t h a t the 1 t r u s t e e s would be the ones to decide t h e y were to do 2 so? 3 MR. O'HANLON: 4 the y d i d n ' t ? 5 MS. MACKEY: But who i s t o say t h a t We see no i n d i c a t i o n . What we see i s Mr. Love. 6 7 8 He i s th e only pers on we see? A MR. O'HANLON: Of course because you 9 d o n ' t see th e t r u s t e e s and 10 th e y are not he re . 11 in r e l a t i o n to t h a t ? 12 109 Q But who i s t o say what went on MR. CUSH: Mr. Love might be a b le to 13 say t h a t he asked the 14 t r u s t e e s or n e g o t i a t e d with them or persuaded them 15 e n d le s s t h i n g s . 16 110 Q MS. MACKEY: I f he saw t h i s p r o p e r t y 17 opportunity, t h i s 18 development o p p o r t u n i t y , t h i s investment 19 o p p o r t u n i t y , and he f e l t t h a t t h i s would be a good 20 chance f o r th e t r u s t to make some money, w ould n't he 21 have t o a t l e a s t c o n t a c t th e t r u s t e e s and say 22 'There i s an o p p o r t u n i t y a v a i l a b l e . 23 approached me about t h i s . ' 24 MR. O'HANLON: For a s t a r t , 25 Someone has I am q u i t e su re he has never ever 26 spoken to any t r u s t e e because he never knew who the 27 t r u s t e e s were. 28 was through Mr. Traynor or any d i s c u s s i o n s he had 29 was through Mr. Traynor. Th erefore any n e g o t i a t i o n s he had He d i d n ' t give evidence 1 from r e c o l l e c t i o n in r e l a t i o n to t h a t a s p e c t of i t 2 o t h e r than g e n e r a l l y about what o c cu r re d. 3 assume t h a t in r e l a t i o n to t h i s , th e f i n a n c i n g of i t 4 was d e a l t with by Mr. Traynor and presumably 5 Mr. Traynor s a i d 'Yale does X and Yale does Y . ' 6 MS. MACKEY: 7 I d o n ' t t h i n k we have any evidence of t h a t in r e l a t i o n to him? 8 9 So I A MR. O'HANLON: I t should be easy enough to check t h a t Mr. Love as 10 11 t o what h i s r e c o l l e c t i o n i s of e x a c t l y how i t was 12 fi na nc ed . 13 112 Q MS. MACKEY: 14 15 i n t e r l i n k e d i n t h a t sense? A MR. O'HANLON: 16 17 They a r e ; I a p p r e c i a t e the point. 113 Q MR. CUSH: 18 There are a couple of th i n g s t h a t you might be 19 abl e to help us with. 20 t h a t . . . (INTERJECTION)? 21 MR. O'HANLON: 22 The two t h i n g s are Aside from No, I t h i n k we w i l l . J u s t to recap i f I may: 23 The da te of repayment by Mr. Love i s number one. 24 Secondly, th e s ta teme nt of a f f a i r s from Yale as to 25 what was in t h e s e documents. 26 Mr. Love's da ug ht er in terms of th e d i s t r i b u t i o n as 27 to what documentation t h e r e i s . 28 t h e r e was no agreement, t a c i t or o th e rw is e , between 29 the dau ghter and th e f a t h e r . The t r u s t e e s to Confirmation t h a t Does th e dau gh ter 1 2 114 Q MS. MACKEY: 3 come w i t h i n th e c at e g o ry 4 5 of documents r e l a t i n g to th e d i s t r i b u t i o n ? A MR. O'HANLON: 7 And f i n a l l y Lynbrette. 115 Q MS. MACKEY: 9 10 Indeed. Y a l e ' s involvement in 6 8 I t h i n k t h a t would a l l With Mr. Love's r e c o l l e c t i o n of i t . A MR. O'HANLON: Indeed and e x a c t l y how the f i n a n c i n g . . . .Did he not 11 12 say in r e l a t i o n to i t . . . . I c e r t a i n l y re a d somewhere 13 t h a t i t was Mr. Traynor who a rr a ng ed th e fi n a n c i n g 14 of t h a t . 15 116 Q 16 A MR. CUSH: The s t r u c t u r e s . MR. O'HANLON: That i s as f a r f r a n k l y as 17 I know of t h a t . 18 19 c e r t a i n l y come ac r os s t h a t a s p e c t of i t . 117 Q MS. MACKEY: 21 scheme. 22 A 23 118 Q MR. O'HANLON: Indeed. MS. MACKEY: I d o n ' t remember anything 24 being s a i d - - but I might 25 be wrong - - about the f in a n c in g ? A MR. O'HANLON: 27 I f you would leave t h a t with me and I w i l l 28 29 He c e r t a i n l y a dvis ed about th e c o n s t r u c t i o n of the 20 26 I have get t h a t as soon as I can. 119 Q 1 I suppose you want to 2 lock-up shop, 3 4 I f we say t e n days or something l i k e t h a t ? 120 Q MS. MACKEY: 5 I f we could have i t b e f o r e E a s te r ? 6 A 7 121 Q MR. O' HANLON: That would be f i n e . MS. MACKEY: A c t u a l l y by Thursday 8 evening, 28th March, i f 9 t h a t i s p o s s i b l e because we w i l l be c l o s e d on the 10 Friday. 11 12 END OF SUBMISSIONS BY MR O'HANLON ON BEHALF OF 13 MR. CLAYTON LOVE 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Appendix XV (68) Mr Bryan Lynam 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Byran L y n a m a) Unsworn statement of M r Edward L y n a m dated 23 June 2000. b) Letter of 22 June 2001 - L K Shields Solicitors to Solicitor to the Inspectors. Correspondence received from or on behalf of M r Bryan Lynam. a) Letter of 21 August 2001 - L K Shields Solicitors to Inspectors. b) Letter of 21 August 2001 - L K Shields Solicitors to Inspectors. c) Letter of 17 September 2001 - L K Shields Solicitors to Inspectors. d) Letter of 26 October 2001 - L K Shields Solicitors to Inspectors. REVISED UNSW ORN STATEM ENT OF EDDIE LYNAM . I, Eddie Lynam, make this statement supplemental to my unsworn Statement o f 23rd March, 2000. I should m ention that I was asked on 23rd March, 2000 by the Honourable Mr. Justice C ostello to ascertain whether I had any further documentation, including any trust documentation or letters o f wishes. W hen I m et w ith the Inspectors on 23rd March, 2000 I furnished to them all documentation which was within m y possession, power or procurement at that time. Subsequent to m y m eeting with the Inspectors, I carried out a further search o f m y house (having previously carried out thorough searches at m y home) and I uncovered further documentation that I had not bean aware o f prior to the meeting. I enclose further copy bank statements from Ansbacher (Cayman) Limited. A s you previously indicated to m e by letter dated 23rd December, 1999 that you have no interest in financial details, I have accordingly been advised by m y Solicitors that it is appropriate for m e to delete such details. I have also uncovered two letters o f w ishes, one dated 3rd September, 1981, the other dated 5th March, 1987. In February, 1 9 9 4 1 instructed Mr D es Traynor to transfer m y account into the names o f m y son and daughter, Bryan Lynam and Mary Lynam, for convenience purposes only. M y children were aware that the beneficial interest in the monies would remain with m e. I also enclose herewith further correspondence received by me from Mr Padraig C olleiy, Ms Joan W illiams and Mr Des Traynor which I discovered as a result o f my recent search. It would also appear from the documentation enclosed herewith that on certain occasions where Mr Des Traynor was unable to contact me (to receive instructions), the deposit was “rolled over", by Ansbacher (Cayman) Limited, on his instructions. . I can now also confirm that the joint-account which I held with my brother was split in approximately March, 1987. This is evidenced by a letter from Mr Des Traynor. On 23rd March, 20001 was under the mistaken belief that at no stage did I transfer any funds to an account in the Isle of Man. It would appear from the documentation enclosed herewith (that I have recently discovered) that monies were transferred to Ulster Bank, Isle of Man, by Mr Des Traynor, on my instructions. I apologise for any confusion that might have been caused in this regard. Without the benefit of this information I would not have been in a position to confirm that I gave these instructions to Mr. Des Traynor. I still have no recollection of giving these instructions to Mr. Des Traynor. As you are aware, I wrote to Mr Padraig Collery asking him to furnish to me any documentation that he might have had in relation to my account. I also wrote to Ansbacher (Cayman) Limited and Mr. Cathal Mac Carthy of Guinness Mahon (Ireland) Limited. I have not received a reply from any of these parties. (1477/00i EC/DOCS/STATE2.DOC) S O L IC IT O R S TlUtPHONB: 933*1 «1 M s . M a r y C u m m in s, S o lic ito r to th e In sp e cto rs, 3rd F lo o r , our R » 1 4 7 7 -0 0 1 /L K S /E C /0 1 0 6 1 1 L 2 T r id en t H o u se , B la c k r o c k , Y O U * R*Fi C o . D u b lin C/LOe/MLC/raf 22** June, 2001 Re: Oar Client! Edward P. Lynam a* M D ear M s. C um m ins, W e refer to y ou r letter o f 1 2 * f a s t O ur clien t instructs u s to respond to you r letter as follow s:R e g a r d in g p a r a g r a p h s 1 a n d 2 A s you are aw are, our clien t instructed M r D esm on d Traynor to transfer b is account held w ith A nsb ach er (C aym an) Lim ited ('‘Ansbacher") to the nam es o f h is son and daughter, Bryan Lynam and M a ty Lynam . Our clien t ga v e this instruction to M r Traynor for convenience purposes on ly (our clien t retaining the b en eficial interest in the m on ies), h ow ever, our clien t is not sure whether h e com m unicated this sp ec ific fa ct to M r Traynor. Our clien t instructs us that after receivin g M r Tiaynor*s reply o f 7 ^ M arch, 19 94, our clien t received n o further correspondence from M r TVaynor or M r Collpry to the b est o f his k n o w led g e and that an y other correspondence relating to this account w as sent to M s M ary Lynam . O ur clien t understands that M s. M ary Lynam and M r Bryan Lynam w rote to M r C ollery b y letter dated 2 2 nd February, 1995 on our clien t’s instructions and instructed him to transfer the funds h eld w ife A nsbacher to an account in U lster B ank (Isle o f M an) Lim ited. This letter also sought confirm ation that the accoun t w ith A nsbacher had b een c lo s e d R e g a r d in g P a ra g ra p h 3 '■ . A s p reviously advised, our clien t instructs u s that to the b est o f h is know ledge n o lodgm ents w ere m ade to the accoun t held b y him w ife A nsbacher after fee initial lodgment. T h e correspondence referred to in your letter under reply refers to the bank account b ein g “rolled over” on a periodic basis. W e trust this letter clarifies your queries. Y q i i p c t n i’ t h f i i l l i / L K S H IE L D S . S O L IC IT O R S . . m Appendix? S O L IC IT O R S 3 9 /4 0 U pper M o u n t Street D u b u n 2, Irela nd . His Honour Judge Sean O'Leary, Ms. Noreen M a c k e y B.L., M r Paul R o w a n F.C.A. & M r Michael Cush S.C., Inspectors, Third Floor, Trident House, Blackrock, Co. Dublin T el eph o n e : 353+ 1 661 0866 F a c s im il e : 3 5 3 + 1 6 6 1 0 8 8 3 D .D .E . B o x N o : 1 2 3 E -M a il : e m a il@ lk s h ie ld s .ie W e b s it e : h t t p : / / w w w . l k s h i e l d s . i e O u r R ef: 1477-001 / E B / B M G / 0 10820L2 Yo u r R ef: C/L06/NSPM 21stAugust, 2001 re: O ur C lients: M s M ary M aher & M r B ryan L ynam Dear Sirs/Madam, W e refer to your letters of 31stJuly, 2001 addressed to our clients. O u r clients wish to respond to the preliminary conclusion by you that our clients were ‘ a client of Ansbacher”. Our clients note that you have not defined what is meant by “a client of Ansbacher”and w e should be obliged if you might do so. Furthermore, you might clarify whether our clients are entitled to pursue option (d) as set out in Appendix C of your letter under reply, if they so wish. Finally, w e enclose herewith letters written on behalf of our clients seeking certain confirmations from you. Yours faithfully, Ends. LK SHIELDS S O L IC IT O R S 3 9 /4 0 U pper M o u n t S treet D u b l in 2 , I r e l a n d . The Inspectors, His Hon ou r Judge Sean O'Leary, M s Noreen M a c k e y B.L., M r Paul R o w a n F.C.A. M r Michael Cush S.C., 4th Floor, Trident House, Blackrock, County Dublin. Re: T eleph on e: 353+1 661 0866 F a c s im il e : 3 5 3 + 1 6 6 1 0 8 8 3 D .D .E . B o x N o : 1 2 3 E - M a il : e m a i l@ lk s h i e l d s .i e W e b s it e : h t t p : / / w w w . l k s h i e l d s . i e O u r R ef: 1477-001/LKS/EC/010820L3 Yo u r R ef: 21stAugust, 2001 O ur C lients: M r Bryan Lynam & M s. M ary M aher Dear Sirs/Madam, W e refer to your letters of 31st July, 2001 with enclosures to our clients and are instructed to reply to same. W e note that you have formed the preliminary conclusion that our clients were “a client of Ansbacher”and that you have afforded our clients the opportunity to provide you with a written reply to this preliminary conclusion. While it is acknowledged that you have set out the procedures to be followed by the Inspectors at Appendix C to your letters of 3 1st July, 2001, prior to advising our clients to provide any written response, or indeed any response, w e request certain assurances from you. W e refer you to the Supreme Court Judgment In the M atter o f N ational Iris h B an k Lim ited, (unreported, 21st January, 1999), in which Judgment Mr. Justice Barrington stated, inter a lia ,:­ ' “ In these circum stances I would uphold the decision o f the learned H igh Court Jud g e but would add the statement that a confession o f a B an k O fficial obtained by the Inspectors as a result o f the exercise by them o f their powers under Section 10 o f the Com panies A ct, 1990 would not, in general, be adm issible at a subsequent crim inal tria l o f such O fficials, unless, in any p articu lar case, the tria l Judge was satisfied that the confession was voluntary In order to protect the interests of our clients and to guard against any perception that our clients will voluntarily answer questions, provide information or provide books or documents or information to you as Inspectors (which they will not), w e request that you confirm that you accept that any information given, or questions answered, or books or records furnished, b y our clients would not be voluntarily given. LAURENCEK.SHIELDS,EDMUNDBUTLER,PATRICIAMcCOVERN,HUGHGARVEY,JOSEPHM . GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTINMcKENNA,MICHAELKAVANAGH,EUGENEFANNING,DAVIDj.H.W ILLIAM S,FIONATHORNTON,NICOLAPALM ER. AOIFEBRADLEY,STEPHENBRENNAN.SIOBHANBUCKLEY,PAULABURKE,EOINCUNNEEN,PHILIPDALY,PATFOX,MARCOW .HICKEY,JANEMEEHAN,CONORMULLANY.JAMESM cGILLION, NIAMHMcKEON.ORLAIGHO'DW YER,DERVALO'HALLORAN,JENNIFERO'NEILL,GARBHANO’NUALLAIN,CORACRAMPTON(FinancialController),THOMASJACKSON(Consultant). We look forward to hearing from you. Yours faithfully, 7 1 Appendix ?(Wm LK SHIELDS S O L IC IT O R S 3 9 /4 0 U p p er M o u n t S tr e e t D u b lin T h e Joint-Inspectors, 3rd Floor, T rid en t H ouse, B lackrock, Co. D ublin. 2, I r e l a n d . T eleph o n e: 353+1 661 0866 F a c s im il e : 3 5 3 + 1 6 6 1 0 8 8 3 D .D .E . B o x N o : 123 E - M a il : e m a i l@ lk s h i e l d s .i e W e b s it e : h t t p : / / w w w . l k s h i e l d s . i e O ur Ref: 1477-001/LKS/EC/010913 L 4 Yo u r R ef: C / L 13 /C / M 4 7 / M L C / m f B y H and 17th September, 2001 re. O ur C lient: Bryan Lynam Dear Sirs/Madam, W e refer to previous correspondence in relation to our client Bryan L y n a m and to your preliminary conclusions communicated in your letter of the 31st July 2001. Let us firstly put on record our instructions that our client was not at any stage a “client”of Ansbacher and did not at any stage have any beneficial interest in any funds in an Ansbacher account. With reference to the Inspectors preliminary conclusions in relation to Mr. Edward Lynam, w e note your c o m m e n t that:- "Although Mr. Lynam claims to have retained the beneficial interest in the deposit account, the documents do not support this assertion. ” ^ This, combined with the reference to the change of a name, is an implied finding that our client held a beneficial interest in that account after February 1994. That finding would be immensely damaging to our client’ s good n a m e and would reflect a position which is untrue in fact. W e believe this to be an unjustified attack on our client’ s good n a m e in circumstances where the unchallenged evidence, of Edward L y n a m is that he himself was at all times the beneficial owner. Indeed, there is no other evidence as to beneficial ownership of the funds in that account. There is of course evidence as to a change of n a m e of the account but that does not address the issue of beneficial ownership. It is quite wrong to refer to the change of n a m e independently of the true position on beneficial ownership and in a w a y which creates the misleading impression that our client was a client of Ansbacher. In the light of your invitation to our client to submit a written statement w e n o w enclose an affidavit sworn by our client setting out the true position on oath. Please note that our client submits this affidavit and this letter under compulsion of the process in which the Inspectors are engaged and in that sense, it is not a voluntary statement. However, if you have any doubt as to LAURENCEK.SHIELDS,EDMUNDBUTLER,PATRICIAMcGOVHRN.HUGHGARVEY,JOSEPHM .GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTIN1McKENNA,MICHAELKAVANAGH.EUGENEFANNING.DAVIDJ.H.W ILLIAM S,FIONATHORNTON,NICOLAPALM ER, AOIiHBRADLl-Y,STEPHENBRENNAN.SIOBHANfEJL'CKLEY,PAULABURKE,EOINCUNNEEN,PHILIPDALY,PATFOX,MARCOW .HICKEY,JANEMEEHAN,CONORM ULLANY,JAMESM cGILLION, NIAMHM cKEON,ORLAIGHO’DW YER,DERVALO'IIALLORAN,JENNIFERO'NEILL,GARBHANO’NUALLAIN,CORACRAMITON(FinancialController),THOMASJACKSON(Consultant). the veracity of what our client says on oath, w e invite you to exercise your powers to require h i m to attend for cross-examination and confirm that if so required, he will attend. In the circumstances, w e request you to alter your conclusions and not include any finding to the effect that Bryan L y n a m enjoyed the use of the funds on deposit and not to include a conclusion that Bryan L y n a m was a “client”of Ansbacher since both of those conclusions would be untrue, unsupported by the evidence and in all the circumstances, an unjustified attack on our client’ s good name. Y o u r s fa it h fiillv L.K . SH IE L D S, SO LIC ITO R S S O L IC IT O R S 3 9 /4 0 U pper M o u n t Street D u b l in 2 , I r e l a n d . His Honour Judge Sean O'Leary, Ms. Noreen Mac key B.L., Mr Paul Rowan F.C.A. & Mr Michael Cush S.C., Joint- Inspectors, Third Floor, Trident House, Blackrock, Co. Dublin T eleph o n e: 353+1 661 0866 Fa c s im il e : 3 5 3 + 1 6 6 1 0 8 8 3 D .D .E . B o x N o : 1 2 3 E -M a il : e m a il@ lk s h ie ld s .ie W e b s it e : h t t p : / / w w w . l k s h i e l d s . i e O ur Ref: Y o u r R ef: 1477-001/EC/BMG/011023L2 C/L06/NSPM 26th October, 2001 Re: O u r Client: M r Bryan Lynam Dear Sirs/Madam, W e refer to your letter of 11"' October, 2001, the contents of which w e have noted. W e assume that your preliminary conclusion that our client was a “ client of Ansbacher”(which you have not defined, despite our requests) was determined on the basis of the existence of our client’ s n a m e as a signatory on the account and letters signed by her and not on any consideration of the beneficial ownership of the account. If so, it seems to us that you have attached a meaning to the concept of “ client”which is strained and quite simply wrong and results in a serious injustice to our client. W e do not accept that your terms of reference entitle you to resolve disputed issues as to the meaning of this term. Your function is, inter alia, to identify persons falling into a certain category and not to reach conclusions of law as to the meaning of that category. If there is doubt, it should be resolved by the court before our client’ s good n a m e is impugned. In the event that you are of the view that our assumption is incorrect and you consider the issue of beneficial ownership to be relevant to forming your preliminary conclusions then w e invite you to call our client to an interview with you on the usual involuntary basis. Finally, w e note that your letter under reply was not signed by M r Michael Cush, S.C. Yours faithfully. LAURENCEK.SHIELDS.EDMUNDBUTLER,PATRICIAMcGOVERN,HUGHGARVEY,JOSEPHM .GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTINMcKENNA,MICHAELKAVANAGH.EUGENEFANNING,DAVIDJ.H.W ILLIAM S,FIONATHORNTON,NICOLAPALM ER, AOIFEBRADLEY,STEPHENBRENNAN,SIOBHANBUCKLEY,PAULABURKE,EOINCUNNEEN,PHILIPDALY,PATFOX,MARCOW . HICKEY,CONORM ULLANY,JAMESMcGILLION, NIAMHM cKHON,OKLAIGHO'DVVYCR,DERVAl.O'HALLORAN,JENNIFERO’NEILL,GARBHANO'NUAi.LAIN,CORACRAMPTON(FinancialController),THOMASJACKSON(Consultant). Appendix XV (69) Mr Edward Lynam 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Edward Lynam. a) Transcript of evidence of M r Edward L y n a m dated 23 March 2000. b) Unsworn statement of M r Edward L y n a m dated 23 March 2000. c) Letter of 3 December 1979 - G M C T to M r Edward Lynam. d) Letter of 2 January 1980 - G M C T to M r Edward Lynam. e) Letter of 3 March 1980 - G M C T to M r Edward Lynam. f) Letter of 2 April 1980 - G M C T to M r Edward Lynam. g) Letter of 11 September 1981 - G M C T to M r Edward Lynam. h) Letter of 1 March 1982 - G M C T to M r Edward Lynam. i) Letter of 4 November 1986 - JD Traynor to M r Edward Lynam. j) Letter of 5 March 1991 - Ansbacher Limited to IIB. k) Letter of 5 June 1991 - Ansbacher Limited to IIB. 1) Letter of 5 September 1991 - Ansbacher Limited to IIB. m) Revised unsworn statement of M r Edward L y n a m dated 23 June 2000. n) Letter of 22 June 2001 - L K Shields to Solicitor to Inspectors. UNDER OATH ON THURSDAY, 23RD MARCH 2000 I hereby c e r t i f y the fo ll ow in g to be a t r u e and a c c u r a t e t r a n s c r i p t of my shor tha nd no te s i n the above named i n t e r v i e w . Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY BL S o l i c i t o r t o the I n s p e c t o r s MS. M. CUMMINS Interviewee: MR. EDWARD LYNAM Represented by: MR. LAURENCE SHIELDS LK SHIELDS SOLICITORS 4 2 UPPER MOUNT STREET DUBLIN 2 WITNESS MR. E. LYNAM I EXAMINATION MR. JUSTICE COSTELLO MS. MACKEY 35 PAGE 34 38 1 2 3 4 5 MR. SHIELDS: Sorry f o r h o ld in g you up. 6 Mr. Lynam's t a x i took 7 a l o t lon ge r to ge t i n t o our o f f i c e and th e n I took 8 a l o t lon ge r f e r r e t i n g around lookin g f o r a 9 p a rk in g space. 10 MR. JUSTICE SMYTH: car Mr. Lynam, we w i l l s t a r t our i n t e r v i e w the n. 11 12 MR. LYNAM: Yes . 13 MR. JUSTICE COSTELLO: My name i s Declan C o s t e l l o 14 and on my r i g h t i s 15 Ms. Mackey and on my l e f t i s Mr. Rowan. 16 I n s p e c t o r s as you know. 17 MR. LYNAM: Yes . 18 MR. JUSTICE COSTELLO: Who have been ap poin te d by 19 We a re the th e Court t o und ertake 20 th is investigation. 21 MR. LYNAM: Yes. 22 MR. JUSTICE COSTELLO: I should e x p l a i n to you 23 t h a t t h i s i s not a Court 24 and i t i s not a T r ib u n a l . 25 I f in the course of the q u e s t i o n s t h a t we ask you, 26 you wish to o b t a i n the ad vice of your s o l i c i t o r . 27 MR. LYNAM: 28 29 I t i s an i n v e s t i g a t i o n . Yes. 1 2 3 MR. JUSTICE COSTELLO: 4 S i m i l a r l y , i f i n the course of th e q u e s ti o n s 5 your s o l i c i t o r would wish to ask pe rm is si o n to 6 a dv ise you, then we w i l l st o p and you can ta ke 7 a dv ic e . 8 tak e l e g a l ad vice a t any time duri ng th e course of 9 t h i s in t e r v i e w . You u n de rs ta nd t h a t you are f r e e then to 10 MR. LYNAM: Yes. 11 MR. JUSTICE COSTELLO: This i n t e r v i e w i s he ld under oath and I w i l l ask 12 13 our s o l i c i t o r now to a d m i n i s t e r th e oath t o you 14 Mr. Lynam. 15 MR. LYNAM: 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Yes. 1 AS FOLLOWS, BY MR. JUSTICE COSTELLO 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Lynam, you r e c e i v e d a long l e t t e r from us, i s t h a t not so? 6 7 A. 8 2 Q. 9 A. 10 3 Q. Yes. I f you would j u s t look a t me, Mr. Lynam? Yes. You w i l l r e c a l l t h a t in t h a t l e t t e r we asked f o r a f u l l and d e t a i l e d st at em en t? 11 12 A. 13 4 Q. Yes. I want to know why you did not comply with t h a t 14 request. 15 MR. SHIELDS: W e ll . . . ( INTERJECTION) 16 MR. JUSTICE COSTELLO: Sorry, Mr. S h i e l d s , I must 17 ask the w it n e ss the 18 question. 19 MR. SHIELDS: 20 A. 21 I t h i n k i t came - - was t h a t th e one from you? I got i t from you? 22 5 Q. 23 A. 24 6 Q. 25 A. 26 MR. JUSTICE COSTELLO: Yes? Well, t h a t would be Christmas Eve. Yes? Well, I d i d n ' t - - I t h i n k I sought advice afterw ards. 27 7 Q. 28 A. 29 Yes. Yes? And th e n th e next t h i n g I got a n o th er l e t t e r from you I t h i n k . 1 2 A 3 9 Q 4 A 5 10 Q And t h a t i s th e reason I d i d n ' t b o t h e r up t o t h a t . You did not b o t h e r today? Because I was always - - i t was iminent, you know. Yes. Because i t was iminent you di d not - - have you 6 got a sta te m e nt ? 7 MR. SHIELDS: We have an unsworn statem ent. 8 9 10 MR. JUSTICE COSTELLO: I see. MR. SHIELDS: Which we want t o hand over. 11 12 MR. JUSTICE COSTELLO: Yes . 13 MR. SHIELDS: And t h a t i s th e p o i n t I was t r y i n g t o make. 14 15 11 Q MR. JUSTICE COSTELLO: However, th e w itn e ss the n i s going to hand in 16 an unsworn sta te m e nt ? 17 18 Yes. A Yes . 19 MR. SHIELDS: C orrect. 20 MR. JUSTICE COSTELLO: Very well th e n . you. 21 22 Thank MR. SHIELDS: There are t h r e e copies of i t t h e r e . 23 That i s the (Same Handed). 24 s ign ed one (Ex hib it 1) 25 MR. JUSTICE COSTELLO: Yes . 26 MR. SHIELDS: So t h a t t h e r e are 27 a d d i t i o n a l c o p ie s . 28 You w i l l a p p r e c i a t e 29 1 MR. SHIELDS: 2 3 4 statem ent. 13 Q MR. JUSTICE COSTELLO: 5 That has now being given Mr. Lynam? 6 A 7 14 Q Yes . I t w i l l be im pos si ble f o r us to de a l with i t . It may be n e c e s s a r y f o r us to r e c a l l you? 8 9 A 10 15 Q 11 A 12 16 Q 13 A 14 15 I t i s a very s h o r t Yes . At a l a t e r da te? Yes . Do you u n de rs ta nd t h a t , Mr. Lynam? I u n de rs ta nd t h a t , yes. I t i s a very s h o r t statem ent. 17 Q Mr. Lynam, t h i s i n d i c a t e s t h a t Mr. Traynor wrote to 16 you i n 1986 and he says t h a t he a t t a c h e s the 17 o r i g i n a l l e t t e r of wishes from you both? 18 A 19 18 Q Yes . I t says: "When you have had th e o p p o r t u n i t y to c o n s i d e r p l e a s e r i n g to ad vise me of th e p o s i t i o n " ? 20 21 22 23 A 24 19 Q 25 A 26 20 Q 27 A 28 21 Q 29 Yes, I c a n ' t r e c a l l what happened th e n. However, I wonder where th e l e t t e r of wishes i s ? I d o n ' t know a t th e moment. I h o n e s t l y d o n ' t know. Have you looked f o r i t Mr. Lynam? Since, yes, I have. Do you know where i t i s ? Where you would put i t ? 1 22 Q. 2 A. 3 In T r a y n o r 's o f f i c e ? I t must be. I have i t . 4 23 Q. 5 A. 6 24 Q. 7 That i s th e only p l a c e . I don't think I h a v e n ' t got i t . Did you look in your own r e c or ds ? Well, I h a v e n ' t much re c o rd s a t a l l . No. However, you w i l l see t h a t t h i s i s a l e t t e r w r i t t e n to you. 8 A. 9 25 Q. 10 A. Yes. 11 26 Q. Yes? 12 A. Is t h i s your home add ress? Yes. 313 Navan Road? Yes, w e ll, t h e r e was - - my b r o t h e r was han d lin g the 13 correspondence in r e l a t i o n to th os e t h i n g s , you 14 know, and I have no correspondence a t a l l r e a l l y . 15 2 7 Q. 16 A. 17 28 Q. 18 A. 19 29 Q. 20 A. 21 30 Q. 22 A. 23 31 Q. 24 A. Are you E.P. Lynam? I am Edward P. Lynam, yes. This l e t t e r was w r i t t e n to you? I t was w r i t t e n to me. Have you looked f o r th e l e t t e r of wishes? Yes, and I c a n ' t f i n d i t . You cannot f i n d i t ? No. Where di d you look? In th e house, in my own house, in some of the 25 drawers and t h a t i s a l l . 26 could f i n d i t . 27 32 Q. 28 A. 29 33 Q. That i s th e only way I Did you have a s o l i c i t o r a t th e time? What year was t h a t ? I had s o l i c i t o r s a l l th e time. Who was your s o l i c i t o r a t th e time? 1 2 Company. 3 MR. SHIELDS: 4 A. This i s 1986. 1986, i t might have been John. I t was e i t h e r 5 Michael S t a i n e s or John S. O'Connor, one of th e two. 6 1986 would be Michael S t a i n e s I t h i n k . 7 34 Q. MR. JUSTICE COSTELLO: Michael S t a i n e s , you th in k ? 8 9 A. 10 35 Q. 11 A. 12 36 Q. 13 A. 14 37 Q. 15 A. 16 I t h i n k i t would have been, yes. A n d .. . (INTERJECTION)? I d i d n ' t ask him come to t h i n k of i t . You d id not ask him? No. Where di d you f i n d t h i s l e t t e r ? That l e t t e r would have been given t o me b y . . . (INTERJECTION). 17 38 Q. 18 A. 19 39 Q. 20 A. 21 4 0 Q. 22 A. 23 41 Q. 24 Sorry Mr. Lynam? I t would have been given to me. . . (INTERJECTION). I f I could j u s t i n t e r r u p t you? Yes. For a moment? Yes. Mr. Lynam, I a p p r e c i a t e t h a t t h i s happened a long time ago? 25 A. 26 42 Q. Yes. And t h a t your memory may be i n f i r m and I would 27 p r e f e r i f you would j u s t t e l l me i f you cannot 28 remember? 29 1 2 A. 3 4 4 Q. I can' t . And i f you cannot remember we can go i n t o i t perhaps 4 further. 5 you would i n d i c a t e to me i f you cannot remember? 6 A. 7 45 Q. 8 A. 9 However, a t th e moment I would p r e f e r i f I c a n ' t remember where i t i s . Okay? Right. MR. SHIELDS: I think - - sorry, j u s t i f I may say t h a t we have 10 11 t r i e d t o have a number of i n t e r v i e w s . 12 been i n s t r u c t e d by Mr. Lynam s in c e h i s l e t t e r 13 a r r i v e d from th e I n s p e c t o r s . 14 MR. JUSTICE COSTELLO: Yes. 15 MR. SHIELDS: We have t r i e d t o get the 16 We have only p i c t u r e , which i s s e t out 17 in th e unsworn st a t e m e n t, and I would have to say 18 t h a t Mr. Lynam's r e c o l l e c t i o n i s f a r from c l e a r on a 19 l o t of o c ca s io n s. 20 MR. JUSTICE COSTELLO: i f . . . (INTERJECTION). 21 22 MR. SHIELDS: 23 24 Mr. S h ie ld s , That i s why we have t r i e d t o . . . (INTERJECTION). MR. JUSTICE COSTELLO: 25 If I c o u l d . . . (INTERJECTION). 26 MR. SHIELDS: Put i t t o g e t h e r i n t h a t . 27 MR. JUSTICE COSTELLO: Mr. Sh ield s? 28 MR. SHIELDS: Yes . 29 1 MR. JUSTICE COSTELLO: 2 This i s not a Court of law. 3 4 MR. SHIELDS: Yes . 5 MR. JUSTICE COSTELLO: However, we are i n v e s t i g a t i n g the 6 7 position. 8 MR. SHIELDS: I acc e pt t h a t . I acce pt that. 9 MR. JUSTICE COSTELLO: 10 And we have t o make our judgment o u r s e l v e s . 11 12 MR. SHIELDS: Yes . 13 MR. JUSTICE COSTELLO: Not on what he may have t o l d you or may not have 14 15 t o l d to you. 16 MR. SHIELDS: 17 A 18 46 Q I accep t t h a t f u l l y . Yes . MR. JUSTICE COSTELLO: I must p r e s s you a l i t t l e b i t on t h i s , Mr. Lynam? 19 20 A 21 47 Q Yes . You have produced f o r us a l e t t e r of the 4th November 1986 i n your s t a t e m e n t (E x h i b it 1)? 22 23 A 24 48 Q 25 A 26 49 Q 27 A 28 50 Q 29 A Yes . Where di d you ge t t h i s l e t t e r ? I got i t from one of my n i e c e s . Your niece? Yes . What i s her name? Eileen. 1 51 Q 2 A No, hold on. 3 MR. JUSTICE COSTELLO: Sorry, Mr. S h i e l d s . 4 MR. SHIELDS: I am s o r r y . 5 A 6 52 Q No. MR. JUSTICE COSTELLO: 7 A 9 53 Q No, hold on a minute, s o r r y I must ask you not to comment? MR. SHIELDS: 10 But I t h i n k h i s recollection 11 i s . . . (INTERJECTION)? 12 A No, I know. I got the l e t t e r t h a t you have, t h i s 14 one here, a t th e time of th e s p l i t . 15 MR. SHIELDS: 16 17 I m u s t . . . (INTERJECTION). 8 13 I am s o r r y . A You gave us t h a t l e t t e r . Yes . MR. SHIELDS: 18 The q u e s t i o n being asked of you i s "where did you 19 ge t i t " ? 20 MR. JUSTICE COSTELLO: Sorry, Mr. S h i e l d s . 21 MR. SHIELDS: Yes . 22 MR. JUSTICE COSTELLO: I really 23 m u s t . . . (INTERJECTION). 24 MR. SHIELDS: I am s o r r y . 25 MR. JUSTICE COSTELLO: I r e a l l y must i n s i s t t h a t 26 we c a r r y out t h e s e 27 p roc ed ures in a pr op e r way. 28 Yes. 29 You want to know where I got t h i s l e t t e r ? 1 2 3 MR. JUSTICE COSTELLO: 4 I f you want t o st op any q u e s t i o n t o give him l e g a l 5 advice do so. 6 MR. SHIELDS: Yes. MR. JUSTICE COSTELLO: Yes? 7 54 Q 8 A 9 10 November th e 4th i s t h a t th e l e t t e r you have? 55 Q A I am r e f e r r i n g to one on the Yes, I would have got t h a t from T r i n i t y S t r e e t , Des Traynor. 13 14 56 Q 15 A 16 57 Q 17 A 18 58 Q 19 20 Yes. 4th November 1986? 11 12 Is t h i s th e l e t t e r you a re r e f e r r i n g to? Who d id you ge t i t from? Des Traynor. Yes ? That i s th e name t h a t i s on i t any way. No. However, you have handed t h i s l e t t e r t o me now. Do you know where you got i t : A 21 I found t h a t . Who you got i t from? That i s one of the few t h i n g s t h a t I f o un d. 22 59 Q 23 A 24 60 Q 25 A 26 61 Q 27 A 28 62 Q 29 A Where di d you f i n d i t ? In my own house. In your own house? Yes . Had you an a c c o u n ta n t, Mr. Lynam? Yes. When.. . (INTERJECTION)? Who.. . (INTERJECTION)? 1 63 Q. 2 A. 3 64 Q. 4 A. 5 65 Q. 6 A. 7 66 Q. 8 A. 9 67 Q. 10 A. 11 68 Q. 12 A. 13 69 Q. 14 A. 16 70 Q. 17 A. 18 Haughey Boland? Yes. At th e p r e s e n t time have you an acc ounta nt? Yes. Who i s t h a t ? D e l o i t t e & Touche. They are th e s uc c e s s o rs ? Yes. To Haughey Boland? Yes. Did you make e n q u i r i e s from them about any of the No, th e y w ou ld n' t have them. You d id not make e n q u i r i e s ? I d i d n ' t make e n q u i r i e s because I know t h e y w ouldn 't have them. 19 71 Q. 20 A. 21 72 Q. 22 A. 23 73 Q. 24 Traynor w ould n't de al with any of them. He d e a l t d i r e c t l y with you? Yes, anyt hin g I would ge t I got from him. Yes? Or my b r o t h e r would get i t . Yes. In r e l a t i o n to t h i s , t h i s r e f e r s t o a l e t t e r of wishes? 25 A. 26 74 Q. 27 29 I t was Haughey Boland. documents ? 15 28 Yes? Yes. I t would appear to i n d i c a t e t h a t a t r u s t had been established? A. Yes. I c a n ' t r e c a l l t h a t to be q u i t e ho nest , the d e t a i l s of t h a t now. I mean i f i t has been - - i f 1 2 75 Q. 3 A. 4 5 Where do you t h i n k i t i s ? I t must be in - - i t i s in being but I d o n ' t know about i t . 7 6 Q. Yes. Would you be p re p a re d to w r i t e t o "Ansbacher" i n Cayman? 6 7 A. 8 77 Q. 9 A. Yes, any of t h e m . . . ( INTERJECTION). For a copy of i t ? I w i l l w r i t e to anybody t h a t you want me t o . I will do i t and I w i l l ge t i t . 10 11 78 Q. 12 A. 13 79 Q. 14 A. 15 80 Q. Yes. Have you done so up to now? No. Will you? I w i l l , yes. I c e r t a i n l y w i l l , yes. I f I may j u s t r e t u r n Mr. Lynam to your - - j u s t i f 16 you could b r i e f l y i n d i c a t e your h i s t o r y ? 17 builder? 18 A. 19 81 Q. 20 A. 21 You a re a Yes. You have been a b u i l d e r ? Yes. I was a b u i l d e r , a house b u i l d e r , f o r the l a s t 54 y e a r s . 22 82 Q. 23 A. 24 83 Q. 25 A. 26 84 Q. 27 A. 28 85 Q. 29 A. Yes? And I was in p a r t n e r s h i p with my b r o t h e r . Yes? E a rl y on. Yes? Most of th e time. Yes? And we b u i l t houses everywhere and we were with 1 Haughey Boland. 2 accountants. 3 86 Q 4 A Haughey Boland were our Yes ? And th e r e s t you have i t t h e r e . Well - - I got a 5 c a l l from Des Traynor when he l e f t , 6 Haughey Boland. 7 87 Q 8 A 9 a f t e r he l e f t , Yes? And he would have known our firm because th e y did accounts you see f o r i t . 10 88 Q 11 A 12 89 Q 13 A Yes ? He di d. Yes ? He was inv o lv ed in the accounts f o r one year and he 14 knew t h e r e was no o v e r d r a f t s and t h a t we would be - ­ 15 any money we d i d n ' t use we would always put i t on 16 d e p o s i t and t h a t . 17 90 Q 18 A 19 Yes. With him? No, we used i t in b u i l d i n g s i t e s around he re . The u s u al t h i n g around here . 20 91 Q 21 A Yes? But he then - - he came up with - - w e ll , he rang me, 22 as I t o l d you. 23 money I wanted to put on d e p o s i t . 24 92 Q 25 A 26 93 Q 27 A 28 94 Q 29 A He rang me to see d id I - - had I any Yes ? I t i s e x a c t l y as i t i s t h e r e . As you s a i d in your sta te m e nt ? That i s i t . Yes? 1 95 Q 2 A 3 Yes. So, I saw him very l i t t l e . I haven't -- I d i d n ' t see him f o r about th e l a s t f i v e or s i x y e a r s . 4 96 Q 5 A 6 97 Q Yes ? Or t e n ye a r s. Yes. Perhaps, we w i l l go through your s t a t e m e n t . 7 Mr. S h ie ld s has he got a copy of th e sta te m e nt ? 8 MR. SHIELDS: 9 A 10 98 Q He has, yes? Yes . MR. JUSTICE COSTELLO: Perhaps, we w i l l go through th e st at em e n t with 11 you (E xhibit 1)? 12 13 A 14 99 Q 15 Yes . In 1979 you r e c e i v e d a c a l l from Mr. Traynor. Was he lookin g a f t e r your accounts a t t h a t time? 16 A 17 100 Q 18 A 19 101 Q 20 A 21 102 Q No. However, h i s f i r m . . . (INTERJECTION)? He had l e f t Haughey Boland. He l e f t Haughey Boland? Yes . You c o n s u l t e d with your b r o t h e r and you got in touch with him then? 22 23 A 24 103 Q You met Mr. Traynor? 25 A Yes, we met Traynor. 26 104 Q 27 And we met Traynor. Yes. Had he looked a f t e r your accounts i n Haughey Boland. 28 A 29 105 Q My b r o t h e r and I met Traynor. Did you know Mr. Traynor? I d id know him. You d id know him? 1 I knew him well but he only looked a f t e r the 2 accounts about - - I t h i n k he only d id one year. 3 That i s about a l l . 4 106 Q 5 Yes. He t o l d you then t h a t t h e r e would be d e p o s i t s i n a bank in th e Caymans of which he was a D ir e c to r ? 6 A 7 107 Q Yes . Did you know t h a t bank? Did you know th e name of th e bank? 8 9 A 10 108 Q 11 A 12 109 Q No, a t t h a t time I d i d n ' t know. However, l a t e r on you l e a r n t i t ? I did, yes, "Ansbacher". Yes. The Guinness Mahon Cayman T r u st , I t h i n k i t was known as then? 13 14 A 15 110 Q 16 A 17 111 Q 18 A No, I d i d n ' t , I never he ard t h a t word b e f o r e . What one did you hear? I only heard t h a t in th e pap ers l a t e l y . What bank di d you hear? At f i r s t I d i d n ' t . I might have been t o l d 19 "Ansbacher" but I d i d n ' t - - "Ansbacher Cayman" 20 became n o t i c e a b l e once or twice a f t e r w a r d s . 21 112 Q 22 A 23 113 Q 24 A 25 114 Q 26 A Afterwards ? Yes . L a te r on? Yes, but not duri ng t h i s , what i s going on now. Yes ? But a f t e r w a r d s I knew t h e r e was "Ansbacher" and I 27 t h i n k i t was based in London. 28 t o do with London. 29 odd c o n f ir m a ti o n of th e amounts. There was something At t h a t time I used t o get an 1 115 Q. 2 A. 3 116 Q. 4 A. 5 117 Q. 6 A. Yes. 7 118 Q. Yes? 8 A. 9 Yes. Who gave you t h o s e , Mr. Lynam? I got them from Ms. Williams in T r a y n o r' s o f f i c e . In T r a y n o r 's o f f i c e ? She would give i t to me over th e phone. She would r i n g me, "Mr. Lynam," t e l l i n g me th e i n t e r e s t i t made t h i s month. 10 11 119 Q. 12 A. 13 Yes? And she might confirm i t . Sometimes she would but not a lw a y s . 14 120 Q. 15 A. 16 121 Q. 17 A. 18 122 Q. 19 A. The i n t e r e s t was changing? Yes. She would t e l l you what i n t e r e s t was earned? She would t e l l you t h a t your i n t e r e s t was changing. Yes? And she would give me th e bal anc e every now and again. 20 21 123 Q. 22 A. 23 124 Q. 24 Yes? Over th e phone s o . . . ( INTERJECTION). Did you ever go i n t o th e o f f i c e and ge t any s o r t of s ta te m e nt from her? 25 A. 26 125 Q. 27 A. 28 126 Q. 29 Of th e amounts? I d id . Well, no. She s e n t me a few s t a t e m e n t s . Did she? I have to say t h a t , yes. Yes? 1 2 A. 3 4 She s e n t them to me a l r i g h t . Yes, she d id send them a ll right. 12 8 Q. 5 Can you remember was t h e r e any name on th e top of th e stat em e nt ? 6 A. "Ansbacher". 7 129 Q. 8 A. "Ansbacher". 9 130 Q. "Ansbacher"? 10 A. "Ansbacher". 11 131 Q. 12 A. Or was i t cut o ff ? Yes. Did you ever v i s i t Mr. Traynor i n h i s o f f i c e ? I v i s i t e d him in - - no, th e only time I v i s i t e d 13 Traynor s i n c e he l e f t Haughey Boland was th e once 14 when I went to see him with my b r o t h e r t o open the 15 account. 16 132 Q. 17 A. Yes? And once on a n o th er occa si on, I c a n ' t remember what 18 i t was about and then t h e r e was a n o th er time. 19 t h r e e or fo ur times I went to see him. 20 133 Q. 21 A. 22 134 Q. 23 A. 24 135 Q. 25 A. 26 136 Q. 27 A. 28 137 Q. 29 Yes? Twice was in T r i n i t y S t r e e t I t h i n k . Yes? And once was in F i t z w i l l i a m . Was i t th e Cement Roadstone Off ic e? Fitzwilliam. The Cement Roadstone o f f i c e s ? Cement Ro ad st on e 's o f f i c e s . Yes? About 1 138 Q 2 A 3 139 Q 4 I t was no thi ng to do with t h i s m a t t e r . I see. Perhaps, we w i l l go on. J u s t p ic k up the s ta te m e nt t h e r e and we w i l l go through i t ? 5 A 6 140 Q 7 Yes . He t o l d you i t would be d e p o s i t e d i n a bank in the Cayman I s l a n d s ? 8 A 9 141 Q Yes . I t re ad s: "A j o i n t d e p o s i t account was opened f o r my b r o t h e r and I i n August 197 9"? 10 11 12 A 13 142 Q 14 Yes . You were t o l d then the r a t e would be ap proxim ately 16.75%? 15 A 16 143 Q 17 Yes . That i s a very a c c u r a t e f i g u r e in your s t a t e m e n t . was wondering r e a l l y how you remember t h a t ? 18 A 19 144 Q 20 A 21 I am so rry ? Or had you any re cord? No, i t i s a copy. I have no re c o rd s a t a l l and I got a copy from my n i e c e . From your nie ce ? 22 145 Q 23 A 24 146 Q 25 A 26 147 Q 27 A Lynam. 28 148 Q Lynam? 29 A Yes . What i s he r name? E i l e e n Lynam. Eil een ? I 1 149 Q 2 A 4 150 Q 5 A 6 151 Q My b r o t h e r was Your b r o t h e r ? Yes . Your b r o t h e r ' s dau ghter would have been looking after it? 7 A Yes . MR. SHIELDS: 9 10 Well, her f a t h e r . involved. 3 8 Her f a t h e r . A His b r o t h e r . My b r o t h e r . 11 MR. JUSTICE COSTELLO: Yes, y e s . 12 MR. SHIELDS: I am s o r r y . 13 MR. JUSTICE COSTELLO: That i s what I th oug ht. That i s . . . (INTERJECTION) 14 15 A Yes . 16 MR. SHIELDS: His b r o t h e r ' s da u gh ter . 17 MR. JUSTICE COSTELLO: Yes . 18 MR. SHIELDS: His b r o t h e r ' s da u gh ter . 19 MR. JUSTICE COSTELLO: That i s what I th oug ht, yes . 20 21 22 152 Q 23 A 24 153 Q 25 A 26 154 Q 27 A 28 155 Q 29 A MR. SHIELDS: I am s o r r y , yes. MR. JUSTICE COSTELLO: Mr. James Lynam? James Lynam. Is t h a t r i g h t ? That i s r i g h t , yes . Yes ? That i s i t . James was a . . . (INTERJECTION)? 1 156 Q 2 A 3 157 Q 4 A 5 158 Q 6 A 7 159 Q 8 A 9 160 Q 10 A 11 161 Q Yes . He was in th e j o i n t account with you? Yes . His da ug ht er was looking a f t e r them the n, was she? Well, I have only got t h e s e l a t e l y . Only l a t e l y ? I only got t h e s e l a t e l y . Anyway we can make f u r t h e r e n q u i r i e s about t h a t ? Yes . I f we j u s t move on the n. The money remained in t h a t 12 account witho ut any f u r t h e r lodgements or 13 withdrawals u n t i l 1987? 14 A 15 162 Q 16 A 17 163 Q 18 19 Yes . I t would appear t h a t th e j o i n t account was s p l i t ? Yes . Again, did you get t h a t from your n ie c e , t h a t in fo r m at io n? A No, I got t h a t from th e l e t t e r . I remember s ee in g a l e t t e r from Traynor about t h a t . 20 21 164 Q 22 A 23 165 Q 24 Yes? In t h i s . I t h i n k i t i s one of th e ones t h a t you gave us where i t says . . . (INTERJECTION)? 25 A 26 166 Q 27 Yes, then i t i s t h e r e , yes. The s p l i t was e f f e c t i v e . They j u s t announced the s p l i t of th e account, i s t h a t r i g h t ? 28 A 29 167 Q Yes . 1 2 168 Q Then you say t h a t you had made no f u r t h e r lodgements 3 t o your account fol lo wi ng th e d i v i s i o n of th e j o i n t 4 deposit? 5 A 6 169 Q 7 Yes, I d i d n ' t . Did you know t h a t you could draw monies on t h i s account? 8 A 9 170 Q 10 A 11 171 Q Well, I knew I could draw money any time I wanted. And you did, di d you not? No. I w i l l come to t h a t i n a moment but I t h i n k your 12 r e c o l l e c t i o n i s not c o r r e c t t h e r e . 13 t r a n s f e r money to the I s l e of Man? 14 A 15 172 Q 16 Did you not Not a t t h a t - - what time a re you t a l k i n g about? I w i l l come to t h a t i n a moment i f you do not recollect it? 17 A 18 173 Q 19 Yes . I w i l l show you th e documents. You go on t o say, "I should mention t h a t o c c a s i o n a l l y I re c e i v e d tele ph on e c a l l s from Mr. Des T r a y n o r . . . " ? 20 21 22 A 23 174 Q Yes . " . . . a n d Ms. Joan Williams who informed me of th e b a l a n c e . . . " 24 25 26 27 You have t o l d me t h a t ? A Yes . 28 In March 1995 you i n s t r u c t e d Mr. Padra ig C o l l e r y to 29 c l o s e your account? 1 2 J u s t i n r e l a t i o n to the use you made of th e account, 3 I have to ask you to look a t c e r t a i n l e t t e r s , which 4 were i n t e r n a l l e t t e r s from IIB, i n t e r n a l l e t t e r s in 5 IIB. 6 MS. CUMMINS: Page 24, Judge, i s i t . MR. JUSTICE COSTELLO: Page 25. 7 177 Q I t i s page 24. Have you got t h a t ? Do you see in this le tte r 8 9 A 10 178 Q (E xhibit 2)? Yes . This i s a l e t t e r from Mr. Traynor to The I r i s h I n t e r c o n t i n e n t a l Bank and i t i s : 11 "Could you p l e a s e arra nge th e t r a n s f e r of S t g £ 1 5 ,000.00 to U l s t e r Bank I s l e of Man Limited f o r c r e d i t to the Account of Edward P. Lynam, Account No. 601195. The c o s t should be d e b i t e d to our Cal l A c c o u n t . . . " 12 13 14 15 16 And i t gives th e "Ansbacher" c a l l account. 17 a t r a n s f e r of money t h a t you asked f o r to 18 the I s l e of Man? 19 A Where di d I ask f o r i t ? That was I never asked f o r i t . I d o n ' t know anyt hin g about The I n t e r c o n t i n e n t a l Bank. 20 21 179 Q 22 A Sorry? I d o n ' t know anyt hin g about The I n t e r c o n t i n e n t a l 23 Bank. 24 somewhere b u t . . . (INTERJECTION). 25 180 Q 26 A 27 181 Q 28 A 29 182 Q I never heard of i t . Well, I he ard of i t Did you not ask Mr. Traynor to t r a n s f e r ? No. S t g £ 1 5 ,000? No. 1 2 183 Q 3 A 4 184 Q 5 A 6 185 Q I beg your pardon? In th e I s l e of Man? No. Could I t a l k to my s o l i c i t o r ? Yes, yes. (Short Discussion) Perhaps, I w i l l put 7 i t a n o th er way to you, Mr. Lynam. 8 obv io us ly you never saw t h i s l e t t e r b e f o r e . 9 l e t t e r t h a t i s w r i t t e n by Mr. Traynor t o The I r i s h I n t e r c o n t i n e n t a l Bank 10 11 A 12 186 Q This l e t t e r , It is a (Ex hib it 2)? Yes . You might not have known t h a t the "Ansbacher" 13 account was in The I r i s h I n t e r c o n t i n e n t a l Bank, i s 14 th at correct? 15 "Ansbacher" account was? 16 A 17 18 You did not know where the No, I knew - - I never - - I d i d n ' t know anything about The I n t e r c o n t i n e n t a l Bank. 187 Q However, what I am s u g g e s ti n g to you i s t h a t from 19 time t o time you drew money. 20 Mr. Traynor and asked him f o r money? 21 A 22 188 Q 23 You went to No, never did, never ever . Did you le av e th e money in Cayman from 1979 and never touched i t ? 24 A 25 189 Q 26 A 27 Yes . You never touched i t ? That i s r i g h t . le tte r. 28 190 Q 29 A Pardon? I t i s e x a c t l y as i t says i n the 1 2 3 MR. SHIELDS: Can we keep cop ies of 4 these? 5 MR. JUSTICE COSTELLO: Of course, of cou rse. 6 MR. SHIELDS: You w i l l give us a copy? 7 MR. JUSTICE COSTELLO: Yes, of co ur se. 8 MR. SHIELDS: Yes . MR. JUSTICE COSTELLO: I f you would j u s t look 9 192 Q t h e r e i s a n o th er l e t t e r ? 10 11 A 12 193 Q 13 A 14 194 Q Yes . On the 5th June 1991 (E xhibit 3) Yes . This i s a t r a n s f e r of a n o th e r sum t o th e I s l e of Man? 15 16 A 17 195 Q 18 A 19 196 Q 20 A 21 197 Q 22 A 23 198 Q That i s n o th in g to do with me. I w onde r. . . (INTERJECTION)? I t i s no t. I t i s d e f i n i t e l y not me. You had an account in The U l s t e r Bank? Yes . In Dublin, was i t ? Yes, O'Connell S t r e e t . Do you see t h i s gives th e account of Edward P. Lynam 24 and account number 601195. 25 the account number? 26 (Same Handed)? A Again, i t a c t u a l l y give s I know but I never got t h o s e . 27 i s t h a t to? 28 account. 29 com pletely f o r e i g n . I never got - - whose I have never got money from "Ansbacher" I d o n ' t know. I t is foreign. I t is 1 199 Q. You see there was another withdrawal in 2 September 1991. 3 to IIB relating to a transfer (Exhibit 4)? 4 A. 5 200 Q. 6 Not me, no. It is a letter from Joan Williams Definitely not me. Definitely not me. These are -- this is the account of Edward P. Lynam. Are you Edward P. Lynam? 7 A. 8 201 Q. 9 A. That is right. Yes? I wonder is that me? I don't know what my 10 Ulster Bank number is here. 11 with me but it gives a number and all. 12 definitely -- I never got money 13 account"...(INTERJECTION). 14 202 Q. 15 A. 17 203 Q. I think the explanation may be Mr. Lynam, if you see Yes. It says, "to... " 19 20 21 And then, "... West London..." 22 23 MS. MACKEY: Nat West. 24 MR. JUSTICE COSTELLO: Sorry, 25 "... Nat West..." 26 27 28 29 No, it is -- "to the on the letter of the 5th March 1991 16 18 I have no cheque book And then, "...A/C Ulster Bank Belfast..." (Exhibit 3)? 1 2 3 4 Sure I know nothing about that, nothing at all. 5 Sure the information...(INTERJECTION). 6 204 Q 7 Perhaps, you could make enquiries in The Ulster Bank, could you? 8 A 9 205 Q 10 A 11 206 Q Yes . Could you make enquires in The Ulster Bank? Yes, yes, certainly. You could make enquiries in the Ulster Bank, Isle of 12 Man Limited, about this account number too, could 13 you? 14 15 A Which one is that? MR. SHIELDS: That is the one the Judge, 16 the Inspector, is asking 17 you about. 18 I don't -- am I getting this right? 19 -- what are they asking? 20 MR. SHIELDS: This account 21 (INDICATING). I am sorry Judge I think, just to clarify the 22 position, 23 MR. JUSTICE COSTELLO: Yes. 24 MR. SHIELDS: However, 25 They are asking I know you are asking the witness. I think just to clarify the position, 26 while it is not entirely within the ambit of the 27 Inspectors other than that the money goes, he did 28 have an account, as I understand it. 29 it was opened on I don't know, in the Isle of Man. Now, what date 1 2 Mr. Shields, you cannot 3 give the evidence. 4 MR. SHIELDS: 5 Yes. No, I can't. No, I am just clarifying it and 6 then maybe you can ask Mr. Lynam again because his 7 recollection is not perhaps clear. 8 MR. JUSTICE COSTELLO: 9 appears...(INTERJECTION). 10 MR. SHIELDS: 11 He had an account at one stage in the Isle of Man, 12 13 Now it okay. 207 Q MR. JUSTICE COSTELLO: 14 It appears that you must have instructed your 15 solicitors that you had an account in the 16 Isle of Man and that you are mistaken, your memory 17 is mistaken? 18 A 19 208 Q 20 A 21 No. Did you not make enquires about it? No, I didn't instruct anybody. MR. SHIELDS: 22 any instructions. 23 24 A No, this is foreign to me. I know nothing about that at all. 209 Q MR. JUSTICE COSTELLO: 27 Very well. that you will...(INTERJECTION)? 28 29 I mean this is ... (INTERJECTION) . 25 26 However, he did not give A I take it then 1 210 Q Discuss these questions with your solicitor at the 2 end of this and if it is necessary you will clarify 3 the matter? 4 A 5 211 Q 6 A 7 212 Q 8 Yes . In the light of what your solicitor said? Yes, I certainly will. I want to refer you to another letter of the 27th February 1995 (Exhibit 5 ) (Same Handed)? 9 A 10 213 Q 11 Yes . This is from Mr. Collery and it is to The Intercontinental Bank: 12 "I should be grateful if you would please transfer the sum of £581,000.00 to the Ulster Bank (Isle of Man) Limited for the account of..." 13 14 15 And it is the same numbered account. 16 "This transfer should be debited..." 17 18 And then to the account number? 19 A 20 214 Q Could I...(INTERJECTION). No, sorry. I just want you to try to recollect. 21 Can you recollect? 22 that you closed the account? 23 A 24 215 Q 25 A 26 216 Q 27 A 28 217 Q 29 You told us in your statement Yes . This seems to be the closing of the account? Yes . £581,000.00? Yes . Does it not look like Mr. Collery transferred that to your account in the Isle of Man? 1 2 218 Q 3 A 4 219 Q 5 A 6 220 Q 7 A 8 221 Q 9 A 10 11 It does? But the other is foreign to me completely... Then this is not foreign to you? No, no, that one is not. You had an account in the Isle of Man in 1995? Yes . Yes? But it was only opened somewhere around that -- no, just before that. 222 Q You can check this out but I think your recollection 12 is faulty, Mr. Lynam. 13 because it is the same numbered account in this 14 letter as in the earlier letters in 1991? 15 A 16 It looks as if you had, Well, the first I have heard of it is all here now. I know about the £581,000. 17 223 Q 18 A 19 224 Q 20 A 21 225 Q Yes ? But I don't remember the other one. Yes? I know nothing about the other one. Mr. Lynam, you were told from time to time that this 22 money was earning interest and you were told the 23 interest it was earning? 24 A 25 226 Q 26 A 27 227 Q 28 29 Which money? The money that you were giving to Mr. Traynor? Yes . Did you in your statements to the Revenue and your tax liabilities did you include these interests? A 1 228 Q. 2 A. 3 229 Q. 4 A. 5 230 Q. 6 You did not? No. That is all I want to ask you, Mr. Lynam? Yes. Mr. Lynam, we could stop now for a cup of coffee if that would be suitable for you? 7 A. 8 231 Q. 9 A. 10 232 Q. 11 A. Yes. We will resume then in about ten minute's time? Yes, no problem. And we will not hold you very long? Yes. 12 13 SHORT ADJOURNMENT 14 15 MR. JUSTICE COSTELLO: 16 17 Mr. Lynam, we will resume. I have no further questions. 18 19 END OF EXAMINATION OF MR. LYNAM BY MR. JUSTICE 20 COSTELLO 21 22 23 24 25 26 27 28 29 1 However, Ms. Mackey 2 would like you to ask you 3 some questions. 4 Yes . 5 MR. LYNAM WAS EXAMINED, AS FOLLOWS, BY MS. MACKEY 6 7 8 233 Q MS. MACKEY: Just a few very brief 9 questions, Mr. 10 A 11 234 Q Yes . First of all you mentioned to us earlier that you 12 received statements from time to time from 13 Ms. Joan Williams? 14 A 15 235 Q 16 A 17 236 Q 18 A Yes . In her office, in Mr. Traynor's office? I did. Which of the offices was that? It was in Trinity Street, on the side o f ...(INTERJECTION). 19 20 237 Q 21 A 22 You went into Joan Williams in Trinity Street? No, you see, no. Joan Williams would ring me every -- I think every three months or something. 23 238 Q 24 A 25 Yes ? And it would be, "Mr. Lynam, the interest is so much this month," 26 239 Q 27 A 28 29 Lynam? Yes? And maybe a week or two afterwards she would send me a note. 240 Q and I would say, "You can renew it." Sometimes but then sometimes she didn't. 1 2 241 Q. 3 Yes. However, did you ever go in to see Ms. Williams? 4 A. 5 242 Q. 6 A. 7 No, I never went to go to see her no. Right? But I went in there. The only time I saw her was when Traynor was there. 8 243 Q. 9 A. 10 244 Q. 11 A. 12 245 Q. 13 Yes? Yes. You told us about those? Yes. You were telling us there also that your niece, Eileen Lynam, gave you some documents? 14 A. 15 246 Q. 16 Yes. From which you were able to prepare your statement today? 17 A. 18 247 Q. Could you ask her Ms. Lynam if she has some more? 19 A. No, I asked her to give us I asked her to ask her father. 20 21 248 Q. 22 A. 23 249 Q. 24 A. 25 Yes? He is very sick. Yes? "Had he any documents in relation to the account because I hadn't got any?" 26 250 Q. 27 A. 28 251 Q. 29 Well... (INTERJECTION) . Yes? Because he used to keep everything. Yes? 1 next thing her brother brought in this thing to me. 2 It just gave me details of that. 3 252 Q. 4 A. 5 253 Q. 6 A. 7 254 Q. 8 A. 9 255 Q. 10 Yes? That is all. Yes? It only related to me. Yes? What we started with and things like that. Would you ask her Mr. Lynam if she has a copy of the letter of wishes that is referred to in this letter? 11 A. 12 256 Q. 13 A. 14 257 Q. 15 A. 16 258 Q. 17 A. 18 259 Q. Yes. Would you ask her that? Yes. And ask her if she has a copy of The Trust Deed? Yes. Would you mind? Yes. Thank you very much. The other thing I wanted to ask you, is your brother still living, is he? 19 20 A. Yes. 21 260 Q. Yes. 22 A. 23 261 Q. 24 A. 25 262 Q. 26 A. 27 263 Q. 28 A. 29 264 Q. Is he in good health? No. Is he not? No, not in good health at all. Yes? Pretty bad. Is he? Yes. Could you give us his address? 1 La Vista Avenue, Sutton. 2 Sutton. 3 265 Q 4 A La Vista Avenue, Sutton. 5 2 66 Q La Vista Avenue, Sutton? 6 A 7 267 Q 8 A 9 268 Q 10 A 11 269 Q 12 18 La Vista Avenue, 18? Sutton. I think it is 18 he is in. Okay. James Lynam. That is Dublin 13? I don't know. I think so. for you. I am not too sure. Okay. That is all the questions I have Thanks, Mr. Lynam. 13 14 END OF EXAMINATION OF MR. LYNAM BY MS. MACKEY 15 16 MR. JUSTICE COSTELLO: 17 I think that is everything Mr. Lynam. Your statement 18 today will be transcribed and we would ask you to 19 come in to sign the transcript of evidence. 20 want a copy of the transcript we can supply it to 21 you. 22 MR. LYNAM: Yes. 23 MR. JUSTICE COSTELLO: You have to pay for it 24 If you unfortunately according to 25 the rules but we can supply it to you. 26 MR. LYNAM: Yes. 27 MR. JUSTICE COSTELLO: We would be glad if you 28 29 could get us any further information now that we have raised with you. 1 M R . LYNAM: 2 MR. JUSTICE COSTELLO: 3 4 to send it on to us. M R . LYNAM: 5 Sure, yes. So, in other words I look into the few 6 questions. 7 MR. JUSTICE COSTELLO: 8 9 You could ask Mr. Shields Look into these matters that we have raised with you. 10 MR. LYNAM: Yes. 11 MR. JUSTICE COSTELLO: You could, if you would 12 like to, incorporate it 13 into a further more detailed statement and send on 14 the documents to us through your solicitor, that 15 would be fine. 16 M R . LYNAM: Okay. 17 MR. SHIELDS: Sorry, there are not any 18 Yes. more letters that we 19 should be aware of? 20 MR. JUSTICE COSTELLO: No. 21 MR. SHIELDS: No. 22 MR. JUSTICE COSTELLO: Okay. 23 MR. SHIELDS: Thank you. 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED. THE EXAMINATION WHEN comm. JU.WL A91!ij 62? L3: :2 LIL, .jg-ulu?w" UNSWORN STATEMENT OF M R EDDIE LYNAM I refer to your letter o f 21st December, 1999. In approximately July, 1979,1 received a telephone call from Mr. Des Traynor. He asked me whether I had any monies to invest. I said that I would consult with my brother and would talk to him in due course. My brother and I met with Mr. Des Traynor some time later. Mr. Des Traynor said that the monies would be deposited in a Bank in the Cayman Islands o f which he was a director. A joint deposit account was opened for my brother and I in August, 1979. We were told at this time that the rate o f return would be approximately 16.75%. The monies remained in that account without any further lodgements or withdrawals by me until approximately April, 1987, when, it would appear, the joint-deposit account was split. I do not recall any instruction from me to split the joint-deposit account. I made no further lodgements to my account following the division o f the joint-deposit account. I should mention that occasionally I received telephone calls from Mr. Des Traynor and Ms. Joan Williams who informed me o f the balance in my account from time to time. On 6th March, 199S I instructed Mr. Padraig Collery to close my account and to transfer the monies when the account was closed. I note in your letter to me o f 21st December, 1999, at paragraph 6 o f Appendix C thereof you refer to the Exchange Control Acts (1954-1992). I do not know whether 1477-001/EC/DK/SB/StateeLdoc any application was m$de on my behalf under the Exchange Control Acts (19S4 1992). Further, I have no recollection o f a letter o f wishes having been signed by me, however, it is apparent from correspondence from Mr. Des Traynor (an extract o f which I enclose herewith) that I may have signed such a letter o f wishes. As you have indicated in your letter o f 21st December, 1999 that you have no interest in financial details, I have been advised by my Solicitors that it is appropriate that the portion o f this letter relating to financial details be blocked out. I have written to Mr. Padraig Collery asking him to furnish, to me any books and records pertaining to my account in his possession (if same are to hand) and I am awaiting his reply. Dated this day o f March, 2000 1477-001/EC7DK/SB/Stated.doc w ?/ ^ i iiM M cr c ka A H ON C A Y M A M TRUST LIMITED A Member of the Qulnwata Mahon Merchant BankingGroup Telephone No 9-4653/4 RO. Box 887 Tele* Grand Caymen CP 305 Cable Address Guinness BritishWest Indies 3rd December, 1979. your ref our ref • Messrs. Edvard 313 Navan Road, DUBLIN 7. Lynam, Dear Sirs, We confirm having accepted the following funds from you: Value: 30th November, 1979. Amount: For Account: Edward Term: 1 Month to 31/12/1979. Rate % per annum: Arranged through: Interest at Maturity: Amount Maturing: Direct. Lynam. .4 1 w F G U IN N E S S M A H O N C A Y M A N TR UST LIMITED 'Vnup Talaphon* No 9—4653/4 RO. Box 887 T.lax Grand Cayman CP 3Q5 Britiah Waat Indiaa Cable Adtfrasa Gulnnats 2nd January, 1980. yourraf ourraf Messrs. Edward 313 Navan Road, DUBLIN 7. Lynam, Dear Sirs, We confirm having accepted the following funds from you: Value: 31st December, 1979. Amount: For Account: Edward Term: 1 Month to 31/1/1980. Rate % per annum: Arranged through: Interest at Maturity: Amount Maturing: Direct. Lynam. gu ,.v ^ :: .. TfclaphonaNo 9-4863/4 Talax dayman pu st limited A tMtoaroftheQuinnaatMahon MerchantBankingGroup * ' CP 305 • RO.Box«87 ‘ Gr»ndC»ym.n CablaAddraaa Guinn... BHtiahWart India 3rd March., 1980. yourraf ourraf Messrs. Edward 3 B Navan Road, DUBLIN 7. L f/■ Lynam, // . i Dear Sirs, you: le confirm having accepted the following funds from . Value; 29th February, 1980. Amount: For Account: Edward Term: 1 Month to 31st March, 1980. Rate % per annum: Arranged through: Interest at Maturity: Amount Maturing: Direct. Lynam. S A Member of tho Guinness Mahon Merchant Banking Group Talaphon* No 9— 4853/4 Talax T~V CP 3 0 3 ' P.O.Box 887 ' Grand Cayman Cable Address Guinnsss BritishWaat Indies * ’ . 2nd April, 1980. your ref our raf Messrs. Edvard 313 Navail Hoad, DUBLIN 7. Lynam, Dear Sirs, We confirm having accepted the following funds from you: Value: 31st March, 1980. Amount: For Account: Edward Term: 3 Months to 30th June, 1980. Rate % per annum: Arranged through: Interest at Maturity: Amount Maturing: Direct. Lynam. A Mambar of tha Guinnaaa Mahon Marcham Banking Group Talaphona Mo 9 - 4653/4 P.O.Box 687 ( ~ ) Talax Grand Cayman CP 430S Britiah Waat Indies Cab I* Addraaa Guinnaaa 11th September, 198 your r*f our r«f Lynam, Messrs. Edvard 313 Kavan Road, DUBLIN 7. Dear Sira, We confirm having accepted the following funds from you: 31st August, 1981. Value: Amount: Edward For Account: Term: . Maturity: 1 month 30th September, 1981. Rate %per annum: Arranged through: Interest at Maturity: Amount Maturing: Lynam Direc t . 119 vsrvup Mm Taltphona No 9-4653/4 Talax Grand Cayman CP 430S British W a n Indie* CabtaAddrasa Gulnnaia 1 s t M a rch , 1 9 8 2 . your raf „ our raf M e s s r s . E d v a rd 3 1 3 N avan R o a d , DUBLIN 7 . Lynam , Dear Sin, We confirm having accepted the following funds from you: Value: 2 8 th F eb ru ary, 1982. Amount: For Account: E d v a rd Lynam. Term: 1 m o n th . Maturity: 3 1 s t M arch, 1 9 8 2 . Rate % per annum: Arranged through: D ir e c t . Interest at Maturity: Amount Maturing: Yours faithfully, GUINNESS MAHON CAYMAN TRUST LTD. Appendix 1 I % V \ 3 TRINITY STREET, D U B L I N 2. Tti.79644/794834 Tatac 33B67 FwlmiBr. 720642 STRICTLY PERSONAL Q 'W.i' 4th November, 1986. E.P. Lynam, Esq., 313 Navan Road, DPBLIN 7. ' Dear Eddie , The split effective 3rd September is: Since inception instructions have been given by you via Joan Williams or myself. Attached hereto the original letters of wishes from you both. I have no idea what is included. i ) ' • When you have had the opportunity to consider please ring^to advise me of the position. Kindest regards, • Yours sincerely, A M tm ktr tfth a B tnry A fuM Please reply to: 42 FltzwOliam Squire, Dublin 1 Tbb 765144/763065 Rue: 612035 ut tf tMtf i r iC M trthm u Mtnktog Group r.a Bos «I7, O nad C tja m , Britkfc Wm ta tia UmiK (Mf) MM4S3/4 IWmb OP4SOS F uc(M f) 949-7946 (•09) 949^267 5 th M a rc h , 1991 G a r r a t t L o g a n , B a g ., I r i s h In t e r c o n t in e n t a l Bank L im ita d , 91 M a r r io n S q u a re , DDBLIN 2 . D ear G a r r a tt, C o u ld yo u p la a s a a rra n g e th a t r a n a f a r o f S t g .£ 1 5 ,0 0 0 .0 0 t o U ls t e r Bank Z a la o f Han L im it a d . f o r c r e d i t t o th a A ccount o f E d va rd F . Lynam , A c c o u n t H o .6 0 1 1 9 5 . Tha c o a t s h o u ld b a d e b ite d t o o u r C a ll A c c o u n t N o.5B ^/M :Q 8?/^J-y ^ Y oura a in c a r a ly , J.D. Traynor. JDT/AJW y f c / <9 10-2. A Mtmbtr oftht Htnry Arubethtr Hokttngi PLC Mtrthmt Banking Group Please reply to: 42 Fitzwilliam Square, Dublin 2. Td: 765144/763063 Rue 612035 P.O. Box 117, Onmd Ctymu, BritM Wot Mitt Phow (I0» 94*4*33/4 Ttlwc C P O M Fuc (109)*<9-7944 (1091 949-S267 5 th J u n e , 1991 G a r r e t t L o g a n , E s q ., I r i e h i n t e r c o n t i n e n t a l Bank L im it e d , 91 M e r r io n S q u a ra , DDBLIM 2 . D ear G a r r e t t , C o u ld yo u p le e a e a rra n g e th e t r a n e f e r o f S t g . E l 4 , 4 8 3 . 3 2 t o ■ U l s t e r Bank Z a le o f Man L im ite d . f o r c r e d i t t o t h e A cco u n t o f Edtrard P . Lynam , A c c o u n t N o. 601 19 5. Th e c o a t s h o u ld be d e b it e d t o o u r C a l l A c c o u n t N o . 02/01087/81. Y o u rs s i n c e r e l y , A Mtmbtr «f tht Htnry Ambtchtr HokBngi PLC Mtnhmu Banking Group Pleue replyto: 42 FitzwflUam Square, Dublin 2 Tfel: 765144/763065 Flu: 612035 Garrett Logan, Baq., Irish Intercontinental Bank Limited, 91 Merxion Square, P.O. Box 117, (feud Otymn, M IA W «t bdfa* Pkon* (109) 949-46S3/4 Tdtau CP 4303 Pwc (109) 949-7946 (809)949-3267 5th September, 1991 D U B L IN 2 . Dear Garratt, Could you please arrange the transfer of Stg,£12,709.85 to Ulster Bank xal« of Han Liraiti for credit to the Account of Edward P. Lwiaa, Account No.601195. The coat should be debited to our Call Jfaoount No.02/01087/81 .• Yours sincerely, f * ' ; ' ^ h ~ •' F o r AHBBAonra T.TMTTBD rv ■ leftO Appendix.? REVISED UNSW ORN STATEMENT OF EDDIE LYNAM I, Eddie Lynam, make this statement supplemental to my unsworn Statement o f 23rd March, 2000. I should mention that I was asked on 23rd March, 2000 by the Honourable Mr. Justice Costello to ascertain whether I had any further documentation, including any trust documentation or letters o f wishes. When I met with the Inspectors on 23rd March, 2000 I furnished to them all documentation which was within my possession, power or procurement at that time. Subsequent to my meeting with the Inspectors, I carried out a further search o f my house (having previously carried out thorough searches at my home) and I uncovered further documentation that I had not been aware o f prior to the meeting. I enclose further copy bank statements from Ansbacher (Cayman) Limited. As you previously indicated to me by letter dated 23rd December, 1999 that you have no interest in financial details, I have accordingly been advised by my Solicitors that it is appropriate for me to delete such details. I have also uncovered two letters o f wishes, one dated 3rd September, 1981, the other dated 5th March, 1987. In February, 1 9 9 4 1 instructed Mr Des Traynor to transfer my account into the names o f my son and daughter, Bryan Lynam and Mary Lynam, for convenience purposes only. M y children were aware that the beneficial interest in the monies would remain with me. I also enclose herewith further correspondence received by me from Mr Padraig Collery, Ms Joan W illiams and Mr Des Traynor which I discovered as a result o f my recent search. It would also appear from the documentation enclosed herewith that on certain occasions where Mr Des Traynor was unable to contact me (to receive instructions), the deposit was “rolled over”, by Ansbacher (Cayman) Limited, on his instructions. I can now also confirm that the joint-account which I held with my brother was split in approximately March, 1987. This is evidenced by a letter from Mr D es Traynor. On 23rd March, 2000 I was under the mistaken belief that at no stage did I transfer any funds to an account in the Isle o f Man. It would appear from the documentation enclosed herewith (that I have recently discovered) that monies were transferred to Ulster Bank, Isle o f Man, by Mr Des Traynor, on my instructions. I apologise for any confusion that might have been caused in this regard. Without the benefit o f this information I would not have been in a position to confirm that I gave these instructions to Mr. Des Traynor. I still have no recollection o f giving these instructions to Mr. Des Traynor. As you are aware, I wrote to Mr Padraig Collery asking him to furnish to me any documentation that he might have had in relation to my account. I also wrote to Ansbacher (Cayman) Limited and Mr. Cathal Mac Carthy o f Guinness Mahon (Ireland) Limited. I have not received a reply from any o f these parties. M r Eddie Lynam (1477/001 EC/DOCS/STATE2.DOC) Append-ix . SOLICITORS 39/40 UPPBR MOUNT STREET DUBLIN 2,IRELAND. Ms. Mary Cummins, Solicitor to the Inspectors, 3rd Floor, Trident House, Blackrock, Co. Dublin TELEPHONE: 353*1Ml 0M« FACSIMILE: 393*1 Ml 0M3 D.D.B. BOX NO: 123 E-MAIL: cmalMlkihitldf,!c WEBSITE: http://www.lkshieldi.le 477-001/LKS/EC/010611L2 o u r rk fi 1 Y O U R REF: C/L06/MLC/mf 22ndJune, 2001 Re: O ar Client: Edward P. Lynam Dear Ms. Cummins, M m We refer to your letter o f 12^ inst. Our client instructs us to respond to your letter as follows:Regarding paragraphs X and 2 As you are aware, our client instructed Mr Desmond Traynor to transfer his account held w ith Ansbacher (Cayman) Limited (“Ansbacher”) to the names o f his son and daughter, Bryan Lynam and Mary Lynam. Our client gave this instruction to Mr Traynor for convenience purposes only (our client retaining the beneficial interest in the m onies), however, our client is not sure whether he communicated this specific fact to Mr Traynor. Our client instructs us that after receiving Mr Traynor’s reply o f 7 * March, 1994, our client received no further correspondence from Mr Traynor or Mr Collery to the best o f his knowledge and that any other correspondence relating to this account was sent to Ms Mary Lynam. Our client understands that Ms. Mary Lynam and Mr Bryan Lynam wrote to Mr Collery by letter dated 22 nd February, 1995 on our client’s instructions and instructed him to transfer the funds held with Ansbacher to an account in Ulster Bank (Isle o f Man) Limited. This letter also sought confirmation that the account with Ansbacher had been closed. Regarding Paragraph 3 As previously advised, our client instructs us that to the best o f his knowledge no lodgments were made to the account held by him with Ansbacher after the initial lodgment. The correspondence referred to in your letter under reply refers to the bank account being “rolled over” on a periodic basis. We trust this letter clarifies your queries. "Yo,rrc L K SHIELDS, SOLICITORS. U U M N C t t JHICfm EDMUND H/TUX. IttTKtCU MCCOVEKN, HUCH CAHVEY, JOKfH U. CAV1N, KMMffT f C V U X CERAND HAf-fENNY. JU H M MdUNNA, MICHAEL KAVANACH. EUCKNK FANNING. DAVID j J i WRJJAMfc FIONA THORNTON. NlCClA I’ALMCIL A O in M A O U Y. STEPHENIRENNAN. SKMHaN BUCKtt%PAULA MJRKI. fOIN CUNNON. t*HU.ir DALY, *T POX. MAKOO W. HICKEY. JANS MOHAN. CONCH M U lU N ttjA M S » M cQUJOK MAMH MOCBONtOWLAICHOrpWVtK>OmVALO, HAm >HAK Jg4frBFEKO'NEUi,CAIMMANOrNUAIXAIN«COKACHAMPION THOMASIACKSON (Cm— Hnfr Appendix XV (71) Mr James Lynam, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr James Lynam. a) Unsworn statement of Mr James Lynam of 10 November 2000. b) Letter of 3 December 1979 - GMCT to Edward and James Lynam. c) Letter o f 2 January 1980 - GMCT to Edward and James Lynam. d) Calculation of interest on A/A5A a/c from 1 April 1997 to 30 June 1997. Ammuxvmn U N SW O R N STATEM ENT OF M r. James Lynam Prepared for the Inspectors Appointed by Order o f the High C ourt to A nsbacher (Cayman) Ltd I have been involved in a property company known as E & J Lynam Properties Ltd for very many years. The Company started about 55 years ago and has been building properties in and around the Dublin Area ever since.. I was familiar with D es Traynor as he audited the company accounts for many years; At that time he was with the fi mi Haugh ey B o land Accountants. In or about 1979 during a discussion with Mr. Traynor he said that i f I wished to invest money he could arrange for this and I would get a better rate o f interest. The initial conversation was relatively short. I do hot remember it in detail however he did say that the monies ,would be invested in the Cayman Islands. From m y records I think this conversation and m y initial investment, which occurred with m y brother -Jatfies, nanpen^d in or about 1979. I believe the r* “-nies v e r s lodged with fwi ^ Cayman Trust Ltd. I never heard o f this Banic before. na^ic. o f Guinness Mahon I do not know i f I ever signed a letter o f wishes or a D eed o f Trust. There is a reference in some o f m y papers to a Letter o f Wishes however I do not have a copy o f ' same. I had very little contact with Des Traynor in relation to this deposit This is largely because there were no additions or withdrawals from the account until circa 1990. I think it was around this time also that the account which I held jointly with m y brother was split into two separate accounts. : , I received letters from Guinness Mahon Cayman Trust Ltd setting out balances and interest accrued and I have enclosed copies o f those which I have retained. I also received letters from Des Traynor directly from his address at 42 Fitzwilliam Square. However I had little or no direct contact with him. In 1985 I developed kidney failure and suffered ill health until I had a successful kidney transplant in May 1989. In reality up to this time the money merely sat in the account and I took very little interest in it. After my transplant I took more interest in the account and had some contact with Des Traynor at 42 Fitzwilliam Square. My practice was to telephone his office and talk with Ms. Williams to advise the particular amount I wished to withdraw and some days later I would call to the office and collect the amount in cash. In this period I held some monies in a call deposit account and other monies in a fixed deposit account. I continued to receive letters from Mr. Traynor during the period confirming the up to date posnxr.. In or about 1994 Mr. Traynor told me about Mr. John Furze and a Mr. Padraig Collery and said that if I had any queries Mr. Collery would handle them on m y behalf if he (Mr. Traynor) was not available. After Mr. Traynor’s death I either made . contact with or was contacted by Mx*. Collery. If I wanted to withdraw monies after Mr. Traynor’s death I would contact Mr. Collery by phone and collect it in the usual , • way. Occasionally Mr. Collery would deliver the amount to m y house in Sutton. In June 1995 I divided the money into three accounts yvhich the documentation shows were numbered A/A5-A, A /A 5-D , A/A5-G. The purpose o f this was to provide three separate funds on which I and my two daughters Eileen and Mary could draw. They have dealt directly with Mr. Collery since that tim e... Eventually the three accounts were closed in late 1997. In relation to the .questions raised in Appendix C the following are m y replies, to the best o f my knowledge: . .. 1. (a) (b) (c) (d) (e) (f) . (g) . There was no Trust Monies first transferred in 1979 . . None . . *r' JG onwards . ' Not relevant I have no copy o f a letter o f wishes although it appears from m y records that one was signed N o Trustees involved. I dealt directly with. Mr. Traynor and Mr. Collery. 2. I did not avail o f this service 3.-7. Not relevant 8. None. . . G U IN N E SS M AH O N CAYM AN TRUST • A Member of the Guinness Mahon Merchant Banking Group Telephone No 9— 4653/4 ■ Telex . L IM IT E D * P.O. Box 887 CP 305 Grand Cayman Cable Address Guinness . . British West Indies your ref 3 r d D e c e m b e r , 1979. our re# • Messrs. E d w a r d & J a m e s Lynam, 3 13 N a v a n R oad, DUBLIN 7. Dear Sirs, W e c o n f i r m h a v i n g a c c e p t e d the f o l l o w i n g funds from you: Value: 3 0 t h November, 1979. Amount: £322,299.17 F or Account: E d w a r d a n d J a m e s Lynam. Term: 1 M o n t h to 31/12/1979. Rat e % _per_ a n n u m :. 16 %. A r r a n g e d through: Direct. I n t e r e s t at Maturity: £4,482.39 A m o u n t Maturing: £326,781.56 G U IN N E SS M A H O N CAYM AN TRUST L IM IT E D A Member of (he Guinness Mahan Merchant Banking Group Telephone No 9~4653/4 Telex CP 305 . RO. Box 887 Grand Cayman Cable Address Guinness . ' " British West Indies 2nd January, 1980. your ref our ref . Messrs. Edward & James Lynam, 313 Navan Road, DUBLIN 7. . Dear Sirs, • We confirm having accepted the following funds from you: Value: * 31st December, 1979. Amount: £326,781.56 For Account: Edward and James Lynam. Term: 1 Month to 31/1/1980. . Rate % per annum: Arranged through: Direct. Interest at Maturity: £4,648.80 Amount Maturing: £331,430.36 A 114197 J A 5 A Opening Balance 9 1 .0 0 3 -5 6 Drawn 11.003-56 8 0 ,0 0 0 -0 0 3016/97. Interest 1 /4 - 30/6 @ 5.5% 1,084-93 -r Appendix XV (72) Ms Mary Lynam 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Mary Lynam. a) Transcript o f evidence of Ms Mary Lynam dated 30 November 2000. b) Unsworn statement of Mr James Lynam of 10 November 2000. Correspondence received from or on behalf of Mr Mary Lynam. a) Letter of 7 December 2001 - Sheehan & Company Solicitors to the Inspectors. Appendixixwz) UNDER OATH ON THURSDAY, 30TH NOVEMBER 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: M S . M . LYNAM Represented by: MR. J. SHEEHAN SHEEHAN & CO 1 2 3 4 5 MS. MACKEY: Ms. Lynam, this will only take a few moments. 6 Mr. Sheehan probably explained to you what we want. 7 We are going to take your evidence under oath. 8 Ms. Cummins will now administer the oath to you. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 1 Q. MS. MACKEY: Ms. Lynam, just to clear 5 up some matters that arose 6 as a result of a statement that your father sent in. 7 To explain to you as we explained to your sister -­ 8 this isn't a Tribunal or a court, it is simply an 9 interview, an information gathering exercise. If at 10 any stage you want to ask Mr. Sheehan anything or 11 get advice from him, tell us and we will stop. 12 Likewise he knows that he can do the same if he 13 wants to advise you. 14 Ms. Lynam a copy of her father's statement to refer 15 to it. 16 was prepared (EXHIBIT 1)? 17 18 A. 2 Q. Perhaps we could give Are you familiar with this statement that Yes, I am. If you would just look at the very last page of it. 19 You will see on the second paragraph that your 20 father describes the dividing of the account in 1995 21 into three separate accounts, one of which was 22 A/A5-A related to himself, A/A5-G related to your 23 sister and A/A5-D which appears to be related to 24 you? 25 A. 26 3 Q. Yes. At the time that happened did your father explain to 27 you what he was doing. 28 A/A5-D? 29 I am only asking you about 1 us what he had done. 2 money and it was in an account. 3 4 Q 4 A Did he tell you where it was? I think he would have said that it was in the 5 Caymans. 6 about where. 7 5 Q 8 9 He explained that he had this I think that is where. I am not 100% sure I certainly knew it wasn't in Dublin. Did he tell you why he was doing this, dividing it up? A His health; he wasn't very well. I think he was 10 afraid that he would die and the money would be 11 lost. 12 introduced us and explained about splitting the 13 account. 14 6 Q 15 Then he He then introduced us to Padraig Collery. Was that the occasion when Padraig Collery came out to your father's house? 16 A 17 7 Q 18 A 19 8 Q 20 A 21 9 Q 22 23 He wanted us to know about it. Yes . You and your sister were there? Yes . Were you present at that meeting? Yes. Padraig was introduced to us. Did he himself explain anything to you, Padraig Collery, about how this worked? A No, I don't remember him saying very much at all. 24 I think my father had explained to us the money that 25 he would draw. 26 from the account. 27 10 Q 28 A 29 11 Q He then suggested that we would draw An account specific to yourself? Yes . Did you know that there was an account specifically 5 1 2 A. 3 12 Q. 4 Yes, I think I did. Did you know -- I am not asking you for figures -­ how much was in that account? 5 A. 6 13 Q. 7 A. 8 14 Q. 9 Yes, he would have told us. You knew what was there available for you? Yes. After that date did you in fact draw on that account at all? 10 A. 11 15 Q. 12 A. We would have, yes. Just you yourself? What would happen is that my father would explain to 13 us how he used to draw it and he expected us to do 14 the same. 15 were getting withdrawn and Eileen and I had some of 16 it . 17 16 Q. I think fairly much the same amounts I am not quite clear about this. It wouldn't be a 18 case that you would decide you needed money for 19 something and withdraw it as you would draw it from 20 a bank account here in Dublin. 21 worked? 22 A. 23 17 Q. 24 A. 25 18 Q. 26 A. Is that the way it No, we would have drawn what he had been drawing. He had been drawing regular sums? Yes. For you and your sister? Over the years he would have given us bits and 27 pieces, not very regularly. 28 giving us money a little bit more regularly after I 29 had separated. But then he started In 1995 he said that he would draw 1 the interest every three months or every 2 four months. 3 Effectively what happened was that at the end of the 4 three-month period while this was on fixed deposit 5 you would effectively draw off the interest? 6 A Yes. Sometimes he would then suggest that he would 7 want to draw more. 8 or sometimes if Eileen or I had a particular event 9 we would say 'Can we draw more?' 10 20 Q He would say 'We will draw more' It was never a question that you as such said 11 'Now I need some money, I should get some.' 12 You just did this automatically at the end of the 13 three-month period? 14 A 15 21 Q 16 A 17 18 In fact did you initiate a withdrawal ever? Without speaking to my father first or without informing my father? 22 Q Or even just you deciding you wanted it and then informing your father that you were doing it? 19 20 Yes, we followed my father's system. A I couldn't honestly say because it was coming in a 21 set pattern. 22 some more' or should I, I probably might have done. 23 I probably would have if there was something I 24 needed. 25 23 Q 26 A 27 24 Q 28 29 Whether I would have said 'Can I take Some necessity that arose? Something that was coming up. In the event that you wanted to do something like that, would you contact Padraig Collery? A 1 2 25 Q. 3 A. 4 26 Q. 5 She was the contact person for Padraig Collery? Because she was the older sister. That is the way it was done. Basically she did it for all three of you? 6 A. 7 27 Q. Yes, she did. When it came to the closing of the account in 1997 8 did you have any part in dealing with the closing 9 down of the account? 10 A. At that stage my father was sicker. I think he 11 wouldn't have been out of the house very often at 12 that stage. 13 and we said that the best thing to do would be to 14 close it, so we did. 15 28 Q. 16 I took whatever advice was available When you say advice was available, what advice would you have got at that stage? 17 A. 18 2 9 Q. From Padraig Collery. When the accounts were closed down I understand from 19 your sister that they were moved temporarily 20 somewhere else? 21 A. 22 30 Q. 23 Yes. Two of them were amalgamated, namely yours and your father's ? 24 A. 25 31 Q. 26 A. Yes. How or why did that arise? Because my father was ill and he couldn't travel. 27 He was put into a situation that the money was being 28 moved. 29 through one of us. He would have had no access to it except And to open up the account. 1 I think it was just because he wouldn't have any 2 access to the money at all unless it was put in my 3 name . 4 32 Q 5 A 6 33 Q 7 8 Yes . The two accounts at that stage then were in your name and your sister's name? A 9 10 So it was put in your name? Yes, they would have been. They weren't in our names, they were in company names. 34 Q I had understood that from your sister. No doubt 11 there was a signatory who could deal with the 12 accounts in the companies names. 13 been you and your sister in respect to the two 14 accounts ? 15 A Yes. Would that have The accounts were put into company names. 16 It was then explained how we could access these 17 accounts. 18 it would have been the letter if we had sent one in 19 arranging for some funds. 20 35 Q 21 When you said did I ever sign anything, You and your sister basically could deal with these accounts on behalf of your father? 22 A 23 36 Q Yes . Finally the other question I want to ask you is -­ 24 during the period that they were on deposit, these 25 three separate accounts both in Cayman and 26 subsequently in this temporary offshore location, 27 did you in respect of A/A5-D return to the 28 Revenue Commissioners the interest that was accruing 29 on your account? 1 2 37 Q. That is all I want to ask you. For the record can I 3 have a brief background of your career. 4 at the moment? 5 A. No, I don't, not at the moment. Do you work After a few years 6 working in secretarial and accounts work I went into 7 the family building company. 8 about three or four years ago. 9 38 Q. 10 A. 11 39 Q. 12 A. 13 4 0 Q. I worked there until You were in E & J Lynam Properties Limited? Yes. You are not working now? No, I am not. Thank you very much, Ms. Lynam. 14 other questions to ask you. 15 this today. 16 you to come back another day. We haven't any Thank you for doing It saves us writing to you and asking 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF INTERVIEW OF MS. MARY LYNAM gamma) UNSWORN STATEMENT OF Mr. James Lynam Prepared for the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Ltd . g&.'wc*r& I have been involved in a property company known as E & J Lynam Properties Ltd for very many years. The Company started about 55 years ago and has been building properties in and around the Dublin Area ever since. I was familiar with Des Traynor as he audited the company accounts for many years. At that time he was with the firm Haughey Boland Accountants. . . In or about 1979 during a discussion with Mr. Traynor he said that if I wished to invest money he could arrange for this and I would get a better rate of interest The initial conversation was relatively short. I do not remember it in detail however he did say (hat the monies would be invested in the Cayman Islands. From my records I think this conversation and my initial investment, which occurred with my brother -James, h appen in or about 1979. I Li.Hi.ve the z^c^ies Wcaw lodged with im, jj«ui&. ior tuc uaiue o f Guinness Mahon Cayman Trust Ltd. I never heard of this Bank before. I do not know if I ever signed a letter of wishes or a Deed of Trust There is a reference in some o f my papers to a Letter of Wishes however I do not have a copy o f same. : I had very little contact with Des Traynor in relation to this deposit This is largely because there were no additions or withdrawals from the account until circa 1990. I think it was around this time also that the account which I held jointly with my brother was split into two separate accounts. . I received letters from Guinness Mahon Cayman Trust Ltd setting out balances and interest accrued and I have enclosed copies of those which I have retained. I also received letters from Des Traynor directly from his address at 42 Fitzwilliam Square. However I had little or no direct contact with him. In 1985 I developed kidney failure and suffered ill health until I had a successful kidney transplant in May 1989. In reality up to this time the money merely sat in the account and I took very little interest in it After my transplant I took more interest in the account and had some contact with Des Traynor at 42 Fitzwilliam Square. My practice was to telephone his office and talk with Ms. Williams to advise the particular amount I wished to withdraw and some days later I would call to the office and collect the amount in cash. In this period I held some monies in a call deposit account and other monies in a fixed deposit account. I continued to receive letters from Mr. Traynor during the period confirming the up to date position. In or about 1994 Mr. Traynor told me about Mr. John Furze and a Mr. Padraig Collery and said that if I had any queries Mr. Collery would handle them on my behalf if he (Mr. Traynor) was not available. After Mr. Traynor’s death I either made contact with or was contacted by Mr. Collery. If I wanted to withdraw monies after Mr. Traynor’s death I would contact Mr. Collery by phone and collect it in the usual way. Occasionally Mr. Collery would deliver the amount to my house in Sutton. In June 19951 divided title money into three accounts which the documentation shows were numbered A/A5-A, A/A5-D, A/A5-G. The purpose of this was to provide three separate funds on which I and my two daughters Eileen and Mary could draw. They have dealt directly with Mr. Collay since that time. Eventually the three accounts wore closed in late 1997. In relation to the .questions raised in Appendix C the following are my replies, to the best of my knowledge: . 1. (a) (b) (c) (d) (s) (f) (g) There was no Trust Monies first transferred in 1979 None i , ••0 onwards ■ ‘ V.-sf relevant I have no copy of a letter o f wishes although it appears from my records that one was signed No Trustees involved. I dealt directly with Mr. Traynor and Mr. Collery. 2. I did not avail of this service 3.-7. Not relevant 8. None. S h eeh a n & C o m p a n y S O L I C I T O R S I C I. A R E S T R E E T D U B L I N T E L E F A X (II ’ . T E L E P H O N E 6 6 I 0 0 I .V D . D . E . (II 6 6 16 92 I ft K C/L08/NSPM JPS/DC/L367 7th December 2001 Inspectors appointed by Order o f the High Court To Ansbacher (Cayman) Ltd 3rd Floor Trident House Blackrock Co. Dublin FAX: 283 3929 RE: Our Client: Ms. Mary Lynam Dear Sirs, We acknoAvledge receipt of your letter dated 16th November 2001 in relation to our above named client. Our client disagrees with the preliminary conclusion of the Inspectors that she was a client of Ansbacher on the grounds that she never considered herself to be the true beneficial owner of the funds in any particular account of that Institution. Yours faithfully SHEEHAN & CO. J EREM IAH (i R A I \ N E A H E R N GERARD SHHKHA N B.A. DAVID B.C.L.. MEL FERGUSON C L E A R ’V B.A. Dip C ON Sl'LTAN T L S .. B.Se. CHRIS G ARRETT C. COLBERT D.L.S.. VAN SHEEHAN DER B A , DOLORES LEE B.C.L. LL.B. LL.B. LL.B. O'KEEFFE (London) B.C.L.. Appendix XV (73) Ms Hedli MacNeice, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Hedli MacNeice. a) Guinness and Mahon loan decision memo of 31 May 1978. b) Telex of 11 January 1977 - Guinness and Mahon to GMCT and telex of 12 January 1977 - Guinness and Mahon to GMCT. c) Telex of 12 January 1977 - Guinness and Mahon to GMCT. d) Letter of 15 February 1977 - Guinness and Mahon to GMCT. e) Guinness and Mahon statement re GMCT of 17 January 1979. .’ E F E R E N ' C E : _____ _________ M I N C J T E N U M B E R : , ---------------- _ \ AME O F APPLICANT: ■ AJx J c m fr^ua/Lb, ' y ^0 DATE. _ 0#%/£. . . ^iVIOUNT: . . . y * A+**~ PURPOSE: . ffiHM & S O U R C E O F R E P A Y M E N T S : v) RATE: Sl7. C O M M I T M E N T FEE: DRAWDOV/N: %9w^-ce U o ^ C SECURJTY REVIEW DATE: *7£ . ' OTHER RELEVANT COMMENTS FOR I N C O R P O R A T I O N IN DE C I S I O N MEMO': (Continued Overleaf) jj^ MV. AUTHORISED n . f , R o v*1i c w D a t e Di?.ris«d TC# KaUlNNESS + MAHON CAYMAN TRUST FROM GUIMSESS + MAHON, H i t DUBLIN OATE 11TH JAN 1977 PLEASE AUTHORISE ME TO REMIT TO MRS. MACN. IN PARIS FRENCH FRANC EQUIVALENT OF POUNDS STERLING SEVEN HUNQRED AND TO DEBIT SUN. SUB. CO. ACCOUNT. REGAROS RU. 15s \k 5205 MARS El 3Q5GUINNESS CP ' 305GUINNESS CP , 5 2 * 5 ^ 3 El TO GUINNESS MAHON CAYMAN TRUST FROM GUINNESS + MAHON, : DUBLIN DATE 12TH JAN 1S77 88S8888SS8IS3Si FOR JOHN FURZE REFERENCE MY TELEX I t / 1 / 7 7 RE MRS. MACN. CAN YOU AUTHORISE PAYMENT AS REQUESTED - BY RETURN IF POSSIBLE. REGARDS RU 16:22 5205 MARS El 3Q5GUINNESS CP P ¥ ... ,.r _ ^ • • .0 ; • .•• ' • •• * .• ■"-•••• •' ;-r ■* ... - ****«*•. • .•> •?**. 5 ' ’’ -" . - ' i ' v“‘ v * ?v «% j m S'-C.V? W‘t :V ' " .• '* .• ; -J.’ *5" • •• 7 / ' ”'-' ’ •• •• -i • • ••• * r v‘ 7* ••. '■ ■ ♦. ■ . A s i 7?■?■.:■•* ^ •' ■ ,* ••• . '■ ■ ■■ )':■ -X . ••. :. ‘ \ -15th. February, 1977. y U . ••, . * ‘ ‘ -V . * ■ y : ■ ■ * . . i.. .•« .. *s '••*." \} * 5 « ***• •■ '' 0 .A.Furze, 0sq.t \ .J ■" . ’ ■ Guinness Mahon Cayman Trust Ltd. • .••. P.O.Box. 887 , '' ' , • ••• Grand Cayman, ■ ■':■:. ■'• . 4 .BRITISH WEST INDIES.;..;. p ;• . \ i . ..v- D ear.John, ’I confirm W telex advlte of the ,15th.’Inst.,' when I advised yeu ' u that I was debiting Sundry Sub.Company Account £500.00 1n respect •o‘iOf cash handed to Mrs.’MacN. on 10/2/77. ‘ *.v••%• ■ ■ V’ w •' .‘ S y„- r. *V i ‘ • V ; ■ * / •" * . :.Av'> Yours sincerely,' *. t • 1v; •; •• -• .**' • !»J *,’•% * 1*•*A ^ ».4 ■. - t . •, T.RlEdHAinr MANAGER ACCOUNTS. •• r ‘. * «L. . «»V _» V* .• *» v\ AV “ rJ. * ' •: • -I. • • 1 ..... pi- ■ ;'«t* ' v'1* ‘ f' ♦, ^ “ ' v *i .' • w' • • . . 1" *-Z*S5&*£3£ 5 * ' ’ “ •* MMJUM.Vt WM • y r a a g p il -V-:?'- 'Avasfk-tT'ffiE’ . • »~ars5i'ar-.^r. •V .. . -vJCKW.2 ^. i* Inspectors appointed b y Order of the High Court T o Ansbacher (Cayman) Ltd 3ul Floor Trident House Blackrock Co. Dublin FAX: 283 3929 RE*. O u r Client: M s . Eilccs Lynsni Dear Sirs, W e acknowledge receipt of your letter dated 16th N o v e m b e r 2001 in relation to our above n a m e d client. O u r client disagrees with the preliminary conclusion of the Inspectors that she w a s a client of Ansbacher on the grounds that she never considered herself to be the true beneficial owner of the funds in any particular account of that Institution. You ....... S H E E H A N & CO. JRRF.MIAH SHEEHAN B.A. DAVID C. COLBERT B A.. LL.B. (iRVINNi: AHF'RN B.C I... MF.I. FERfll’ SON B.Sc. D.I..S.. DOLORES O'KEEFFE B C.L.. THE HIGH COURT IN T H E M A TTER OF T H E C O M P A N IE S A C T S 1963 to 1990 AND IN THE M ATTER OF PA R T II OF TH E CO M PAN IES A C T 1990 AND SECTIONS 8 AND 17 AN D IN T H E M A TTER O F A N SB A C H ER (CAYM A N) LIM ITED (formerly GUINNESS M A H O N CAYM AN TR U ST LIM ITED, A N SB A C H ER LIM ITED and CAYM AN IN T E R N A T IO N A L BANK A N D TR U ST COM PANY LIM ITED ) R e p o r t A p p o i n t e d A ffairs o f o f t o t h e In s p e c t o r s E n q u i r e A n s b a c h e r i n t o t h e ( C a y m a n ) L imited Published by Order o f the Court made on 24 June 2002 V olum e [8 ]: A p p e n d ix X V (7 4 ) to X V (8 0 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (74) Ms Mary Meagher McCarroll 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Mary Meagher McCarroll. a) Extract of transcript of evidence o f Mr Patrick McCarroll dated 19 June 2000. 2. b) Statement and attachments provided by Ms McCarroll to the Inspectors dated 12 July 2000. c) Copy statements dated 30 June 1991, 31 July 1991, 30 June 1992, 31 December 1992, 31 January 1993, 31 March 1993 and 20 April 1993. d) Letter of 3 September 1991 - Patrick McCarroll to Padraig Collery. e) Undated letter - Patrick McCarroll to Padraig Collery. f) Unheaded ledger statement for the period 31 March 1989. g) Letter of 26 September 1990 - Ansbacher Limited to Guinness and Mahon. Correspondence received from or on behalf of Ms Mary Meagher McCarroll. a) Letter of 28 September 2001- Eugene F Collins to Inspectors. EXTRACT FROM TRANSCRIPT OF EVIDENCE GIVEN TO INSPECTORS BY MR. PATRICK MCCARROLL ON MONDAY 19thJUNE, 2000. 1 afterwards and I said I felt that may be we were too 2 small. 3 188 Q. Yes. We were not of interest to them. If we move on then Mr. McCarroll to some other 4 topics. 5 off-shore account in Guernsey too? 6 A. In relation to your wife, did she have an We got married in 1986 and I had had my 7 Guinness & Mahon account, my Guernsey account, 8 since 1978. 9 189 10 Q. Yes? A. And shortly after we got married, in 1987/88/89, we 11 were working in the States and I think that during 12 that time I communicated with Padraig and I said, 13 "Mary is earning money in the States," and we put it 14 into an account with Guinness & Mahon 15 and...(INTERJECTION). 16 190 Q. What was your wife's occupation? 17 A. An architect. 18 191 . Q. 19 A. She is also an architect. She is an architect? Yes, and when I got th? letter in relation to this I 20 was actually surprised because I thought Mary would 21 get a letter too because I thought she had had an 22 account also. 23 192 24 Q. Yes? A. And then when we saw that she didn't get a letter I . 25 said may be this code, the "P" and "M", was 26 something Padraig managed. 27 28 29 193 Q. Yes? A. To just identify the money, what was Mary's and what was mine. 1 194 2 3 195 Q. Yes? A. But that ia just surmising. Q. So as I understand, it does appear then that your 4 wife lodged money in Guernsey? 5 6 196 7 A. Yes. , Q. When she was in the States, is that right? A. Yes, the mechanism would be that we would have just 8 sent a cheque to Padraig, a dollar cheque may be, 9 and just credited it to the account. 10 197 Q. I would like you to be a little more specific. You 11 see you had an account but it does appear from the 12 documents that your wife had an account too? 13 A. separate account. 14 15 198 16 17 199 18 Q. Yes? A. For a while. Q. Yes? A. And it is only, recently because of the communication we received from you...(INTERJECTION). 19 20 Yes, I thought that my wife had an account, a 200 Q. Leaving that aside, just tell, me what you understood 21 to be the position? 22 wife had a separate account? 23 24 201 A. I thought my wife had a separate account, yes. Q. Yes. 26 A. 27 29 Did you ever get, did she or you ever get, statements about it? 25 28 Did you understand that your Yes, and Mary has — she didn't keep as complete records as mine. 202 Q. Yes? A. And I believe she has a few statements. 1 203 2 3 204 Q. Yes. A. Yes, absolutely, yes. Q. You see the document that I referred you to earlier, Very well. You can get those for us? 4 the closing of the College Trustee account — 5 page 117 in ours and it is "O^/S-24" in yours. 6 Would you look up that (Exhibit 4)? 7 8 205 A. Yes. Q. There is a hand written note there at the left hand 9 Yes. column which refers to a sum of "£11,369" with the 10 "/Mary" opposite it? 11 12 it is 206 A. That is correct, yes.. Q. That was money that was to be deposited in your 13 wife's account, is that not right? 14 A. Well, I think that was already in the Bank and what 15 Padraig was doing there — that is Padraig's hand 16 written note. 17 207 18 Q. ■ A. 19 20 It is not my note. It is hand written. It is Padraig's. It is Padraig's note? I have the original here (INDICAXIKG). 208 21 Q. Yes? A. And what Padraig was doing was probably responding 22 to a query from me saying, "What is the total in our 23 two accounts? 24 calculations and then put the two together and gave 25 me a total figure. 26 209 Q. 27 However, I am asking you about your wife's account? 28 29 No. Where are we," and he then did his 210 A. Yes. Q. There is a letter in the correspondence in which you 35 r ' 1 refer specifically to this, is there not? 2 3 211 4 5 212 6 A. There is, yes. Q. Would you just look that up for me? A. I have a letter here "OA/C -1" (Exhibit 12) . Q. What is the...(INTERJECTION)?. A. And I say: ’ "I enclose the sterling equivalent of 1/3 of the cheque for $3511.00 for 10,553. Please deposit one-third in my a/c, one-third in Mary's a/c." 7 8 9 And one-third to somebody else. 10 11 213 12 13 214 Q. Yes. This is in 1991. This is May 1991? A. Yes. Q. You are referring to a third in Mary's account. It 14 is quite clear, is it not, that Mary had a separate 15 account? 16 17 215 216 20 21 Well, as I said, yes. Q. She had? ' A. 18 19 A. 217 22 She has documents showing us that separate account? A. She has a few statements. Q- A few statements? A. She has nothing like the extent of statements or correspondence that I have. 218 Q. 25 28 29 Yes. Do you see there is another letter "OA/C-7" to Padraig? 26 27 I believed she had a separate account. Q. 23 24 . 219 A. Yes. Q. You say: ".... I reviewed the figures we discussed in approximately Sept/Oct '89.... "? 2 3 220 Q. 4 5 6 A. 221 7 8 Q. You are referring to the two accounts? A. Yes. 222 9 10 "... Mary and myself corrected the amounts in our accounts"? Yes. . Q. Is that right? A. Yes, yes. 223 Q. "However, we got mixed up. The balances were Mary £11,369.69" 11 12 and you £30,486.27? 13 14 15 224 A. That is right, yes. Q. Again, it is quite clear that she had a separate 16 account? 17 18 225 A. Yes. Q. There is an earlier reference in the correspondence 19 to a deposit opening in the name of, your then 20 fiancee, Ms. Claire Lynch in 1980? 21 22 226 A. That is right, yes. Q. Was that opened, do you know, in the name of 23 Ms. Claire Lynch? . 24 A. 25 26 amount from memory was about £3,000. 227 Do you know was it maintained, or was it closed, or 27 28 29 My understanding was that it was and I think the what happened to it? A. I have no idea because Claire and I then split up in 1981. STATEMENTS AND DOCUMENTS PROVIDED BY MARY MEAGHER T0 - THE INSPECTORS. My husband, Patrick McCarroll and I got married in August 1986. At the beginning of 1987 we went to live in the US. Initially my husband was working but I was not. After a few months , in or around May 1987,1 also got work with the company my husband was working with. During the period we were working in the US, and I cannot be precise as to exactly when, I started sending funds to my husband's account in Guinness and Mahon, as I thought in Guernsey. I am not sure if I thought I had my own account at that time as my husband dealt with communications with the bank except for one or two occasions when I collected money from Padraig Collery. ' To a very large extent I left the matter to be dealt with by my husband and Padraic Collery, it was never a real concern of mine whether I had a separate account or not Subsequently when I saw the letter "M" on some of the statements I do remember thinking I had my own account.. When I did not receive a letter from the High Court Examiners in January 2000 similar to the one my husband received we both assumed that there must have only been one account and that Padraig Collery kept a record of the individual deposits. The only people I met in connection with Guinness & Mahon were Padraig Collery and Joan Williams. I did not keep very extensive records and I only have a few sheets o f statements that I located in old files. I attach copies of those statements for your attention. I also have one record of an investment in Swiss Francs with the bank, but beyond a copy of the statement I have no recollection of any further details of this investment. I lived with my husband in the various countries he has mentioned to you in his submissions and I attach a record of our residence locations. 1.1 Cayman Island Trust and Trust companies 1.1.1 Deed of Trust I did not cause to be executed a Deed of Trust or other instrument in the Cayman Islands. 1.1.2 Correspondence None 1.1.3 First transfer of cash or assets The first cash I transferred to my/our account in Guinness & Mahon Guernsey would have been approximately mid 1988 or early 1989.. I am not sure about this date and have no records to support my memory. 1.1.4 Subsequent transfer of cash or assets The only transfer of cash to and from my/our account that I have records for are the attached. I do not recall, or have any other information whatsoever, relating to any other transfers. 1.1.5 income from Trust I did not have a Trust with Guinness and Mahon. 1.1.6 Settlor, John Furze or others I never heard o f the name John Furze until the extensive coverage in the press during the last year or so. I never saw trust documents. 1.1.7 Letter of wishes, supplementary deed I never executed a letter o f wishes or supplementary deed. 1.1.8 Communications and instructions I never communicated with a trustee. I only met Padraig Collery on a couple of occasions to collect funds. I never discussed the detail'of the account with him; my husband dealt with such discussions. 1.2 Irish residents with deposits in Cayman effecting withdrawals from Guinness and Mahon (Ireland) Ltd. My husband and I were not resident in Ireland during this period. I had no other current or deposit account with Guinness & Mahon. As mentioned above I did have a Swiss Franc account Any funds that I withdrew were taken through my husbands Irish Guinness and Mahon account 1.2.1 Name and address of person who informed of service. My husband’s accounts were set up before we got married. 1.2.2 Date first availed of and subsequent transactions My statements indicate the first transaction as being prior to March 1989 (Swiss Franc) and there may have been other statements. 1.2.3 Manner of lodgements My husband dealt with all lodgements. 1.2.4 The manner of withdrawals My husband would withdraw funds in cash or by cheque from the account he had in Dublin. 1.2.5 If accounts Amiens Securities Ltd., Amiens Investments Ltd., Kentford Securities Ltd., were used. I never heard o f these names. 1.2.6 Code number for account I thought the Irtter M signified the funds in-my section of the account. The statements I received all had the headings removed. 1.3 Irish residents with deposits in Cayman effecting withdrawals from Irish Intercontinental Bank Limited. I had no deialings with that bank. 1.3.1 Name and address of person who informed of service. Not applicable. 1.3.2 Date first availed of Not applicable 1.3.3 Manner of lodgements Not applicable 1.3.4 The manner of withdrawals Not applicable 1.3.5 If accounts Amiens Securities Ltd., Amiens investments Ltd., Kentford Securities Ltd., were used. Not applicable 1.3.6 Code number for account. Not applicable v 1.4 Loans and Guarantees from Guinness and Mahon (Ireland) Ltd. Not applicable. 1.5 Loans and Guarantees from Irish Intercontinental Bank Limited in conjunction with Kredietbank NV None. 1.6 Exchange Control permission Not applicable. 1.7 Guinness Mahon (Ireland) Ltd. with subsidiaries; Guinness Mahon Jersey Ltd., Guinness Mahon Channel Islands Ltd., College Trustees Ltd. I was not aware o f where the funds were actually located. ^ . 1.7.1 Name of person who informed of service Not applicable. 1.7.2 Correspondence relating to setting up Trust Not applicable. 1.7.3 Manner lodgements were effected Not applicable. 1.7.4 Manner in which withdrawals were effected Not applicable. 1.7.5 Date of first transfer of cash or assets Not applicable. 1.7.6 Dates of subsequent transfers of cash or assets Not applicable. 1.7.7 Dates income received Not applicable. 1.7.8 Settlor, John Furze or other . I never heard o f the name John Furze until the extensive coverage in the press during the last year or so. . I do not believe this is applicable to me. 1.7.9 Letter of wishes or supplementary deed Not applicable. ■ 1.7.10 Methods of communication and copies of correspondence Not applicable. 1.8 Identify following bodies 1.8.1 Bodies corporate in which I had an interest None 1.8.2 Subsidiaries of such bodies corporate None 1.8.3 Other entities related to such bodies corporate None 1.8.4 All trusts with interest as Settlor, Trustee or beneficiary None . jjjjj I The following table sets out where I was resident during the period 1978-1996. The dates are based on a variety o f sources and can be readily vouched. IliMlfllHliiiilinViilHilil I H P i " " 'iiM W 29 Aug 86 Returned to Ireland to get married Sept • Dec 86 Dublin, not working Jan 87- June 89 St Louis, Missouri, USA June 89 - April 91 Algarve, Portugal April 91 - Oct 91 Kilkenny Oct 91-Apr 92 Eslinton Park. Dunlaoghaire Apr - Sept 92 2 Maretimo Gdns. West Blackrock Sept 92 -M ay 95 Muscat, Oman May 95 -Present Ireland Mary Meagher Dublin, 12thJuly 2000 '. fill' ' 11/ 5/91 10/ 6/91 BROUGHT FORWARD 3 0 / 6/91 In te r e s t to 30/ 6/91 1 9 5 7 8 .9 0 3 3 4 .3 7 :il'l I Ml) tO/ 6/91 V______ CARRIED FORWARD 20133.27 8/ 7/91 8/ 7/91 igf888HTFO"W ARO 9 1 0 .0 0 ( HH'l c £ 31/ 7 / 9 1 i m € CARRIED FORWARD iTr Jl/ 10/ 5/92 6/92 30/ 6/92 BROUGHT FORWARD 30/ 6/92 In te r e s t to 3 0 / 6/92 2 2 9 4 7 .7 3 558. H 2 3 5 0 5 .8 7 J 50/11/92 1/1 2/92 H /1 2 /9 2 31/12/92 __ _ _ _ _ _ _ _ _ BROUGHT FORWARD 25/11/9 2 31/12/9 2 D RA FT In te r e s t to 31/12/92 6 0 0 0 .0 0 3 8 2 .9 '. 2 2 6 5 9 .4 1 1 6 6 5 9 .4 1 1 7 0 4 2 .3 5 H /0 1 /9 M /0 1 /9 J7 / 0 1 / 9 '5 / 0 1 / 9 iV O l/ 9 3 3 3 3 3 31/01/93 V______ 0.00 BROUGHT FORWARD 31/12/92 07/01/93 LODGED 19/01/93 25/01/93 IR 5 0 0 0 IR 2 0 0 0 L O D G E !- 1 7 0 4 2 .3 3 2 1 4 0 .0 0 5 2 5 0 .0 0 1 7 0 4 2 .3 5 1 4 9 0 2 .3 5 4 0 0 0 .0 0 '. 3 6 5 2 . 3 5 1 8 /0 2 /9 3 1 1 /0 3 /9 3 11/03/93 V______ BROUGHTFORWARD 31/03/93 In te re s t to 31/03/93 CARRIED FORWARD ------ -------BUUIIIoXJ BALANCES SHOWN ARE IN: 2 0 /0 4 /9 3 3 0 /0 4 /9 3 BROUGHT FORWARD : PAST IE ! 400 CARRIED F0RWARP fAUt sterlin g 1 3 8 5 4 .4 2 4 6 3 .1 6 1 3 3 9 1 .2 6 /A /*>' n . . •.•v• • . .■• • A • ••• * •* . ♦♦ . ••»' •. I .• . . o ♦. ‘ ** • ft••Mt•t • * •'V.** • V••** vC***' H *\ * • ^ £ 5 6 £ ± t iy : J & ./ u * 0 * & ^ 1r.T m c £ m + ik + * . _ --- .^stt:--- ' — «s£&---- S & fe z f& ’ a A ►% I ^C 8 X U 4 w «m * q . - r d f- C t± — ■•**feiy„.'jg/c_ — .-- ----------------- !----------- b * •'»* . ’••/ * . • • * # i • '*i » * '. • • » ......... 0 J r* ( A A f* - * C ~ C s- 4 to /e - ! ? u s £ A/i. j o-y ./"tf y & V vrt. , > j& y jt^ n / & . (»«.*✓• /tt ♦ ■ J e * .^ . .< * «.y L /- tt> u y , . >4.^*1 - j- j / / 3 6 9 - 6 9 ' a r s . *—1^1 . . _-/«-» «/*»( c-6 '. . t~*t (■ 'C d ^•<.dL»^ y ✓^~lt JA.^ , _ l j o *-8 &. z. 7 . r tt- A C-I * //jTcrO-<30^ ^ewvv. . / (IIc».H,< C -Z < ^ -4 -* --\. C - -. t* ^ -J • «*— t-<-v. £ » -* * j • %J 'C x t5£. i S . y* /A « * /i,^»*y u . , «tirUU>m £ j _ d S t» ’ i2 - .* M J9 0 * ~ C “* f “^ £ w -^ c & 3 > 'S 3 0 — 1 3 — 11 Grindlays B a n k pic. PayJ^t...fklAi&k.. S q u a re , L o n d o n , S W 1 Y * LF ysjG^.trd!i™rzz: ________ or O r d e r 3 .&u!o d £ . . . < £ m d h ^ d L - m * u JWvd*&<3L.---- £ (.911 ** $ 8 .n T i< r111 T A hi * . . 2 ? . ,; ' D O « ' 0 B O B ' HV ONt ANNNNH4* • • • • • • • • • • <6 £ K «N 15 — * 0“V\ *»».»»»»»•. • f« « 0» in •n » s * * n - a .5 .. g u. •o ­ X J S o . ■"3 *r **• •n * A % ui . •• UHV » rt „rt « « < < r» i« r»»v O m miii o* iv a -»UI M + (*.*> < . « t U K « ** o * " ' •»•«. »*••.: *-“ji # .*. . •’ ,uy •.t j*. 3 3 *> ' « 5 9 .......... w m ^ imh.h .- 4P* «4«*»»• . I ’ •D O O S D 0 *1 . A M tm bv o f the Henry Atubacher Holdings PLC U tnhant Banking Group P.O. Box 887, Grand Cayman, British West Indiet Phone: (809) 949-4653/4 Telnc CP 4305 * Fax; (809) 949-794$ (809) 949-5267 Please reply to: . 42 Fitzwilliam Square, Dublin 2. TeL 765144/763065 Fax: 612035 26th September, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness & Mahon Limited, 17 College Green, DOBLIN 2. -Jar David, . Could you please arrange to wire transfer US$4,875.00 to Morgan Guaranty Trust Co., 23 Wall Street, New York, N.Y. 10005^ U.S.A. • A.B.A. 021 000 238 ' • . • • ' , for credit to .Prudential Bache Account 72200011' for further credit to . A/C .Patrick McCarroll ESY-4205'86-8R . ^ p l e a s e debit the post to.Ansbacher Limited Account No.13154602 advising Sterling figure in due course'. • * • « ’ • ___ _____ •Yours sincerely, • / J.D. Travnor. & EUGENE i'ndeat House Biackrock Co. Dublin F. C O L L I N S 3 BurlirwjtcN; Kiwii Du Win 4 1 2 X ‘ 6400 Tel: -3 5 3 Fax: * 3 'j i i G67 5200 By post & by fas: 2833929 dx ?r> E m ail: ■JW'ycrgefc ie W e b s ite : wi.vw.cfc ic- f TUPH/M23660.001 Re; 28’fl September 2001 y o u r r t f Aushacher (Cayman) Limited Our dicat: Mrs. Mary Meagher - McCarroll Patrick McCarroll (dcccased) Dear Sirs, We refer to your letters of 18mSeptember 2001 addressed, in the first instance, to our client personally but also as the legal personal representative of Patrick McCarroll deceased. We represent Mrs. Meagher McCarroll both in her own right and as executrix of her late husband’s estate and are corresponding with you therefore in respect of both letters. We appreciate that die late Mr. McCarroll was formerly represented by John P. O'Malley Sc Company but they are aware of our present involvement. W>■: mention, as an aside, lhat your correspondence to our client arrived on the anniversary of her !inshand’s death. We refer to the statements attached to your two letters and to the preliminary conclusion in each instance that both the late Mr. McCarroll and his widow Mrs Mary Meagher - McCarroll were clients of Ansbacher. We fmd such a conclusion, and particularly its non qualification, perverse in all the area instances that exist and the evidence that is available. We propose to deal with the findings in each case separately: 1: Mr. Patrick McCarroll (deceased) In a statement preceding your preliminary conclusions at paragraph 3, you accurately detailed Mr. McCarroll’s background. The contents of paragraph 2 are of particular relevance and includes the sentence "it would appear that his funds, in c o m m o n with those of m a n y persons whose funds were managed by College Trustees, were deposited subsequently in Ansbacher so n a rs I -i \ v- f/ji:: L w . - j . V U i O r * r n -i e t ? WiC'ad •/.* C ri'V - A s s o c ia t e s i r r r n Hv.or Tf»r*y ■:< t v '. v y 1 Gerarcl Coll i c h l i C C it O llO H . ; L-. r v O fv? -i VV.ic^p j..v y I., ..-* ;: H i o m u 'J C i 1 without his knowledge." (emphasis added). Despile this apparent acceptance of fact, you conclude that the late Mr. McCarroll was a “client” of Ansbacher. We attach an extract from the Oxford dictionary which defines the word client as fallows “a person using the services of any professional; a customer”. In our view such a relationship is based on contract, one of the essential criteria of which is to form an intention to create legal relations. We ask rhetorically how one can form legal relations with an entity of whose existence you are blissfully unaware? In the exhibits attached to your statement there are included statements from G + M Bankers. It was to this institution that Mr. McCarroll lodged his money in the belief that an offshore account had been set up for him in Guernsey. Some of the statements originate from the bank in that jurisdiction and only one of those we have seen makes reference “Guinness & Mahon Cayman Trust Limited”. We would also refer you to the evidence given by the late Mr. McCarroll in his interview with you on 19thJune 2000 when he was very clear in his testimony about the nature of his relationship with Guinness & Mahon and his instructions to Padraig Collery with regard to his funds. Although the narrative contained in your statement reflects the late Mr. McCarroll’s status as a non-resident, no-where is this referred to in your preliminary conclusions. You will doubtless be aware of the stigma attaching to anyone found to be the holder of an Ansbacher account. If Mr. McCaiToli had been knowingly such an account holder (which is patently not the case) there would have been nothing untoward about that situation because throughout the years in question Mr. McCarroll was resident and working outside the jurisdiction and was not therefore subject to Irish Income Tax. You will be aware from his evidence to you that he took professional advice on his position and was careful not to contravene Irish tax laws. If it is still your intention, despite everything we have said, to persist with your preliminary conclusions, it is absolutely essential that you qualify that finding by inclusion of the additional facts:- (a) Mr. McCarrol l’s alleged status as a client of Ansbacher was without his knowledge; and (b) Mr. McCarroll was non resident for tax purposes throughout the period in question and was therefore fully entitled to maintain an offshore account. Mrs. M ary Meagher McCarroll Everything we have outlined in respect of the late Patrick McCanoJI applies equally in relation to his wife. All the more so in her case because she appears not to have instructed Guinness & r Mahon directly but relied on her husband to do so.. No attempt was made by the late Mr. McCarroll to hide the fact that his wife also had an account with Guinness & Mahon and that these funds were held offshore because there was nothing unusual or unlawful in that situation. Again we would contend that is all the circumstances of the case and in the light of the evidence made available to you, it is perverse to conclude that Mrs. Meagher McCarroll was a ‘'client*' of Ansbacher. If you nonetheless persist in this finding it would be contrary to the principles of fairness and natural justice if you did not qualify your findings in the same way as we have outlined above in Mr. McCarroU’s case. W;; look forward to hearing from you and would emphasise that all communications should be directed to this office. Youri faithfiillv. Eugene F, Collins ^k\syi\wi\jitocbmV^iOl>ireBii35in*p.Uoc Appendix X V 1. 2. (75) M r P a t r i c k M c C a r r o l l , d e c e a s e d Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Patrick McCarroll. a) Transcript o f evidence of M r Patrick McCarroll dated 19 June 2000. b) Guinness Mahon Guernsey Limited ledger statement of 18 March 1980. c) Guinness Mahon Bankers ledger statement re Guinness Mahon Guernsey o f 31 December 1979. d) G M CT statement re College Trustees Limited of 31 March 1982. e) Unheaded ledger statement re A/A43P - a/c no. 80001632 - o f 3 October 1990. f) Letter o f 26 September 1990 - Ansbacher Limited to Guinness and Mahon. g) Unheaded ledger statement re A/A43P - a/c no. 80001632 - of 31 December 1990. h) Letter o f 19 February 1991 - Ansbacher Limited to Guinness and Mahon. i) Letter o f 25 November 1992 - Hamilton Ross Company Limited to IIB. j) Letter o f 3 September 1991 - Patrick McCarroll to Padraig Collery. Correspondence received from or on behalf of M r Patrick McCarroll. a) Letter o f 28 September 2001- Eugene F Collins to Inspectors. UNDER OATH ON MONDAY, 19TH JUNE 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. PATRICK McCARROLL Represented by: MR. JOHN O'MALLEY JOHN P O'MALLEY SOLICITORS 3 8 PERCY PLACE DUBLIN 4 WITNESS MR. P. MCCARROLL I EXAMINATION MR. JUSTICE COSTELLO MS. MACKEY 43 PAGE 42 82 1 2 3 4 MR. JUSTICE COSTELLO: Mr. McCarroll, we will 5 start our interview then. 6 Mr. McCarroll, my name is Declan Costello and on my 7 right is Ms. Mackey. 8 know, Inspectors by The High Court. We have been appointed, as you 9 10 I should explain to you at the outset we are, of 11 course, not a Court. 12 is an interview. We are not a Tribunal. This 13 14 If in the course of the questions that we ask you 15 you wish to take advice from your legal advisors 16 please tell us so and we will stop asking you 17 questions. 18 19 Similarly, if Mr. O'Malley wishes to advise you on 20 any question that we are asking you he can indicate 21 this to us and we will stop asking you questions and 22 you can take legal advice. 23 24 Your evidence Mr. McCarroll will be taken under 25 oath. 26 administer the oath to you. 27 28 29 I will now ask our solicitor, Ms. Cummins, to 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: Mr. McCarroll, I think it 5 probably would be most 6 convenient if you could start off by giving us a 7 brief summary of your professional career; could you 8 do that for us? 9 A. Yes. I am an architect. I qualified from UCD 10 in 197 6. 11 I got an employment opportunity with an Irish 12 company who were setting up an office in Sudan. 13 1978 I left Ireland and I worked as an architect 14 running a practice in Khartoum in Sudan for four 15 years. 16 German consultancy company and I worked for them in 17 Baghdad. 18 Okay? 19 2 Q. 20 A. I worked in Dublin for two years and then In I left that company and in 1982 I joined a If I can give you a general picture is it Yes? Yes, and I worked there for approximately two years. 21 That was 1984. 22 practice in Nairobi in Kenya with two other guys and 23 I ran the practice in Kenya, again for a couple of 24 years. 25 I came back to Ireland. 26 my wife and I left Ireland in January 1987 to work 27 in the United States, where we lived and worked for 28 two and a half years. 29 another German company, Euroactivade in Portugal. I then bought an architectural I then sold my interest in that practice and I got married in 1986 and I then worked for a German, I 1 went straight from the United States to Portugal and 2 I worked for them for a couple of years. 3 1990/91, started discussions with first of all the 4 architects who were doing the work on Mount Juliet 5 and subsequently the owners of Mount Juliet 6 themselves. 7 3 Q 8 A 9 4 Q 10 A 11 I then, in Sorry, what was the name of that? Mount Juliet. Is that the name? Mount Juliet is the name of the leisure & golf course in County Kilkenny. 12 5 Q 13 A 14 6 Q 15 A 16 7 Q 17 A 18 8 Q 19 A 20 9 Q 21 A 22 10 Q 23 A 24 11 Q Yes ? 25 A Yes. Yes ? And I was involved in some work with them. You were a consultant, were you? I was a consultant. Or an architect? More project management. I see? I managed the other consultants for Mount Juliet. Yes? May I refer to my notes here? Yes, do, yes? Just to make sure. When I finished work with Mount Juliet I then 26 worked in Dublin with Mclnerney International on 27 project management work. 28 12 Q 29 A Yes? 1992, I then left Ireland again and I took up a 6 1 position in Muscat in Oman with an English company 2 called JSA Oman & Associates and I worked in Oman 3 with that company until the end of 1994, 4 approximately the end of 1994. 5 sole trader and I became involved in work in 6 Eastern Europe and I have been really continuing 7 that type of work in Eastern Europe since 1995/96 8 and that is what I am doing at the moment. 9 suppose you could describe my work now as 10 11 I then set up as a consultancy project management work. 13 Q. Yes. When you came back to Ireland in 1990/91 with 12 Mount Juliet did you come with your wife? 13 a family? 14 So, I A. Have you Have you children? I have one son now but at that time we had no children. 15 16 14 Q. 17 A. Yes? And when I came home it was a sort of a vague 18 situation because I was first of all asked by the 19 architects to Mount Juliet to work with them but at 20 that point, again from memory, 21 had signed a contract with Mount Juliet. 22 discussions with -- Campbell Conroy Hickey were the 23 architects. 24 possibility of working with them. 25 series of meetings with them and during that period 26 I got to know Tim Mahony and the people in 27 Mount Juliet. 28 29 15 Q. Yes? I don't think they So, I had I had discussions with them about the I came home for a 1 I would like to join them. 2 offered was portrayed as a very nice and very 3 interesting position with long-term prospects. 4 this time my wife was still living -- I still rented 5 a house in Portugal and my wife was still there and 6 we were trying to decide whether we would come home 7 full-time or not. 8 in about early 1991 and I rented a house in Kilkenny 9 and then Mary came back. 10 16 Q 11 A 12 17 Q 14 A 15 18 Q 16 We made that decision, I think, You decided that you would come home? We decided we would come home. Again, I had no Yes? And I had no, you know, full long-term contract. Very well then. In 1992 then you left Ireland and you went to Oman, is that not right? 17 A 18 19 Q 19 A 20 20 Q 21 That is correct, yes. And then you went to Eastern Europe? Yes . Have you any residence here in Ireland then since then? A 23 Yes, I have a house. I bought a house in Ireland at the beginning of 1993. 24 21 Q 25 A 26 Yes ? And while we were away in Oman we rented out that house. 27 22 Q 28 A 29 At contract. 13 22 The position that I was Yes? My wife became pregnant in 1995 or we had a child in August 1995 and I think in approximately May or June 1 1995 we came back and Mary started living in the 2 house. 3 23 Q. 4 A. 5 24 Q. Yes? And I was travelling quite a bit. Yes. I want to ask you Mr. McCarroll some questions 6 about the bank statements that you forwarded to us. 7 If we take them in chronological order it is tab 11 8 in ours. 9 that in your file there (Exhibit 1)? 10 A. 11 25 Q. 12 A. 13 26 Q. Yes. I think you have "OA/S-53"; have you got Yes, I have it. If we could just look at these briefly? Yes. If we work from the earliest date forward, and the 14 document I have at page 88, and you have headed it 15 as OA/S-53. 16 brought forward. 17 (Exhibit 1)? 18 A. 19 27 Q. 20 A. 21 28 Q. 22 A. 23 29 Q. It is the 30th November 1979. Have you got that document Yes, I have, yes. Do you see the top there: then "CP"? Yes. "P McCarroll Esq." and And then: "Call"? Yes. If you just move on to a document that is headed 24 "G & M Bankers," and it is a ledger. 25 November 1979. 26 A. 27 30 Q. 28 29 A sum is It is Have you got that? Which is my reference? It is the next page, I think. I have not got your 1 31 Q. Do you see this: "C This has changed now. 2 is a different document. 3 "C/P Guinness Mahon Guernsey Limited"? 4 A. 5 32 Q. This The account name is: Yes. It is sterling currency, non-resident call 6 account and there is an account number there; do you 7 see that? 8 A. 9 33 Q. 10 A. 11 34 Q. 12 A. 13 35 Q. 14 Yes. That is your account, is it not? Yes, that is. I presume this is the one I sent you? Yes? Yes, that is my account, yes. Your name is not on it and throughout this there is this code "C/P", which refers to you? 15 A. 16 36 Q. 17 I wasn't aware that that "C/P referred to me. How could this refer to you? There is no reference to you on that document, is there? 18 A. 19 37 Q. 20 No. Or in any of these documents your name does not appear, the account name? 21 A. 22 38 Q. That is correct, yes. This is an account in the name of 23 Guinness Mahon Guernsey in Guinness & Mahon 24 in Dublin, here in Dublin, is that right? 25 A. 26 39 Q. It is -- no, it is Guinness Mahon Guernsey. 27 Is the account not from your -- is the account not 28 Guinness & Mahon in Dublin? 29 1 40 Q. 2 A. 3 41 Q. 4 Not that account? No. What is " G & M Bankers"? Is that the...(INTERJECTION)? 5 A. 6 42 Q. 7 A. 8 43 Q. 9 A. 10 44 Q. Guinness & Mahon Bankers. Yes? Who had a bank in Guernsey. In Guernsey? In Guernsey, yes. Yes. Do you recall these coming? Did these come to 11 you from Guernsey or did they come to you from 12 Dublin? 13 A. 14 on a regular basis. 15 45 Q. 16 A. 17 The account statements actually weren't sent to me 46 Q . Yes? And because I was away so much...(INTERJECTION). Yes? 18 MR. O'MALLEY: Sorry, if I may? 19 MR. JUSTICE COSTELLO: Yes . 20 MR. O'MALLEY: Just for a moment? 21 MR. JUSTICE COSTELLO: Yes . 22 MR. O'MALLEY: Maybe Mr. McCarroll will 23 just explain. 24 MR. JUSTICE COSTELLO: Yes . 25 MR. O'MALLEY: When he left Ireland in 26 when he left Ireland 27 originally what happened the account he had with 28 Guinness & Mahon at that point. 29 It might help to 1 47 Q 2 A 3 Actually I just wonder would it be useful if I explained how I came to deal with Guinness & Mahon? 4 48 Q 5 A 6 49 Q 7 Yes ? And how that lead into my accounts? I was going to ask you about that. However, if you like to take it in that order do? 8 A 9 50 Q 10 A 11 51 Q 12 A I think it might help... Very well then? ... help to clarify it. Very well then. Yes? My father was the Managing Director of a company, 13 a construction company, in Galway called 14 Malachy Burke Contractors. 15 1970's that company was approached or there was 16 negotiations to be taken over by the Moy Group. 17 52 Q 18 A In the early to mid Yes ? And the Moy Group used Guinness & Mahon as their 19 financial advisors. I was at college at this time so 20 it is my memory of what my father told me. 21 53 Q 22 A Yes? But in the mid 1970's approximately the Moy Group 23 took over Malachy Burke Contractors and at that time 24 my father then sold some of his interest in the 25 company and he stayed on as Managing Director. 26 father gave me and my sister £10,000 each. 27 54 Q 28 A 29 My Yes? And in my case he put the £10,000 into a deposit account with Guinness & Mahon Dublin and I had that 1 money in that account. 2 that money. 3 tax advice and I asked Guinness & Mahon -- sorry, if 4 I go back. 5 account in Guinness & Mahon Ireland. 6 55 Q. 7 A. The Revenue were aware of When I left Ireland in 1978 I got some At that time I also had a current Yes? When I was leaving Ireland to go to work in Sudan I 8 asked Guinness & Mahon was it possible that they 9 could help me set up an off-shore account because 10 when I was living in Sudan I wanted to have money 11 either in sterling or dollars or whatever. 12 this and they opened an account for me in 1978 in 13 Guinness Mahon Guernsey. 14 dealing with that account, initially I corresponded 15 with Guinness Mahon Guernsey and subsequently most 16 of my communication went either through Martin Keane 17 or Padraig Collery in Guinness & Mahon Dublin but 18 even though the communication was going through 19 Dublin I was always under the impression, and I was 20 lead to believe, that my account was in Guinness 21 Mahon Guernsey. 22 56 Q. 23 A. They did When I was abroad, in Yes? I then noticed, when I was at home or if I asked for 24 a bunch of statements, for example that the tops 25 were cut off or that names were changing. 26 difficult now to give you a very clear sort of 27 feeling of what I felt or what I thought at the time 28 because I have had time to think back on this but I 29 think there are three relevant issues. It is The first 1 one is that my main priority was just to look -- I 2 used these accounts just as a savings account. 3 didn't do much transactions, especially in the early 4 days . 5 Yes ? 6 A I My main focus was, "What is my balance," and when I 7 got accounts from Padraig, or statements from 8 Padraig, on different headings I didn't really care. 9 I know Padraig personally and I trusted him 10 implicitly. 11 Padraig in Dublin, and the issue arose, it was put 12 to me more that this was -- they had an opportunity 13 to get a better interest rate and that I was part of 14 something that might be termed an exclusive group of 15 people but it was very vague and in those terms. 16 58 Q 17 A Once or twice when I actually met Yes ? My reaction to that was one of being amused and 18 amusement really because I felt that I was outside 19 the tax net. 20 advantage from any exclusive group if you like 21 because I could have had my money in other off-shore 22 accounts but it was useful for me to have my money 23 with Guinness & Mahon because then I could top up my 24 local account if my overdraft ran up. 25 59 Q 26 A 27 60 Q So, that I wasn't getting any Yes ? That is the background to the account. That is helpful Mr. McCarroll. I think if we go 28 through these documents it may help to clarify the 29 situation further? 1 2 61 Q. 3 If you could turn to the accounts we were looking at. 4 A. 5 62 Q. 6 It is headed: "G & M Bankers" (Exhibit 2)? Yes. Then it is account name: "C/P Guinness Mahon Guernsey"? 7 A. 8 63 Q. 9 Right. Did you understand that to mean that this was an account in a bank called Guinness & Mahon Bankers 10 and the account in the bank was in the name of 11 Guinness Mahon Guernsey Limited? 12 A. 13 I never looked at that heading in that kind of detail. 14 64 Q. 15 A. Yes? I looked at it "Guinness Mahon Guernsey". 16 My impression was that my money was in 17 Guinness Mahon Guernsey and any companies that I 18 worked with and I asked them to transfer money 19 for me, I told them to transfer it to 20 Guinness Mahon Guernsey. 21 65 Q. In Guernsey? 22 A. In Guernsey. 23 66 Q. Yes, yes. If we just move on and it is in my file 24 at number 131 and it is the same account number but 25 the name has changed to College Trustees and it is 26 December 1981; have you got that 27 28 29 A. (Exhibit 3)? Which is my reference on that one? 1 67 Q. MR. JUSTICE COSTELLO: 2 OA/S38. Have you got that ? 3 A. 4 68 Q. Yes, I will just open it up. Do you see this Mr. McCarroll? Yes, I have it. This is headed: 5 "Guinness Mahon Cayman Trust Limited," and it has an 6 address in the Cayman Islands? 7 A. 8 69 Q. 9 A. 10 70 Q. 11 A. 12 71 Q. 13 A. 14 72 Q. Right. It is: "C/P". It is this code again? Yes. It is "College Trustees Limited"? I see that, yes. You see the account number is exactly the same? Right. Does this not appear to be a ledger account that 15 was held in Guinness Mahon Cayman Trust Limited 16 and the account name is not your name but 17 College Trustees Limited with this code in front of 18 it, this same code? 19 A. 20 73 Q. 21 22 23 I see that, yes. Yes. That is your funds? Those are your funds quite clearly? A. 74 Q . 24 A. 25 75 Q. They are, yes. Yes? The funds are mine, yes. Yes. If we move on the photostating does not appear 26 to have any top or title on them. 27 photostating do you think or was the subsequent 28 document without a heading? 29 Is that the 1 76 Q. 2 3 77 Q. 4 A. 5 78 Q. 6 A. 7 79 Q. 8 A. 9 80 Q. 10 A. 11 81 Q. 12 If you look on to the subsequent ones in that. MS. MACKEY: The very next page. MR. JUSTICE COSTELLO: The very next page? The very next page, I see. Yes, yes (Exhibit 4). And the following pages; have you got all these? Yes. The following pages? Yes. There is no heading at all on these? That is right, yes. Do you remember was there no heading on these or is that the photostat? 13 A. 14 82 Q. 15 A. 16 83 Q. 17 No, I have the origins here. And is there a heading on it? No. Yes. Could you just show me the original just so I can see it? 18 A. 19 84 Q. 20 Yes (Same Handed). Do you see this looks very like as if somebody had cut off the heading, does it not? 21 A. 22 85 Q. 23 A. 24 86 Q. It does, indeed, yes. I was going to ask you about that? Yes. A number of these accounts have no headings. Would 25 I be correct in saying that it looks as if they had 26 been cut off, the headings had been cut off? 27 A. 28 87 Q. 29 That is correct, yes. And you did not do it? 1 Yes. 2 are in your name and the later accounts, that we 3 have just been looking at, the heading has been cut 4 off? 5 A 6 89 Q 7 8 So, we have accounts. None of these accounts Yes . Did you ever ask Mr. Collery why they cut the heading off, or Joan Williams? A 9 Well, again you see during a lot of this period I was actually away and the statements came maybe in 10 bundles. 11 occasionally but my main focus was that I was living 12 outside the Country and whatever was going on I 13 didn't see as affecting me. 14 90 Q 15 A 16 91 Q When I saw the statements I was puzzled Yes, I understand all that? Yes . I am wondering can you recollect did you say 17 something to Mr. Collery, 18 off of these statements"? 19 A No. "Why have you cut the head I mean I am sure it came up once or twice when 20 I met him and again Padraig created this sort of a 21 vague feeling, or a vague environment, that this was 22 due to some kind of administrative thing, and that 23 we were part of a group, and that for privacy 24 reasons and that it was better that it was done this 25 w ay. 26 92 Q 27 A Yes? And I know it may seem strange now but when I dealt 28 with Padraig very often I dealt with him by phone 29 call or a letter, as you have seen in the file, and 1 if Padraig had said to me, "I am going to move your 2 money here, there or anywhere," I would have said, 3 "Fine". 4 When he is talking for privacy reasons, that could 5 mean that the amount of funds would not be known 6 because of tax reasons but that did not concern you, 7 is that what you are telling me? 8 A I had no...(INTERJECTION). 9 94 Q You were...(INTERJECTION)? 10 A 11 95 Q 12 That didn't worry me at all. As far as you were concerned you were not liable for tax? 13 A 14 96 Q That is right, yes. Yes. Could I just look at the last one in this bunch, it is OA/S24 15 16 A 17 97 Q 18 A 19 98 Q (Exhibit 4)? Yes . Do you see there are handwritten figures on that? Yes, yes. Do you see towards the end there there is, 20 "£11,369.65," and then, "/M," after it and then 21 underneath that, 22 A 23 99 Q 24 A 25 100 Q "£30,486.27," and then, "p"? Yes, I do, yes. That was a division between your wife and yourself? That is correct, yes. The next bunch of documents I went to refer to you 26 is a completely different format and they are 27 OA/S23; have you got that 28 A 29 101 Q Yes, I have those, yes. (Ecxhibit 5)? 1 2 102 Q 3 Again, it is quite clearly a continuation of the sum. 4 A 5 103 Q Do you see £30,486.27 is lodged to it? Yes, I see that, yes. Do you see the format is different in that it starts 6 off with the date, the value date and then 7 description and if you look back at the other 8 documents the other documents are different: 9 have a date; they have particulars; they have a 10 value date, and debit? 11 A 12 104 Q 13 A 14 105 Q 15 16 They Yes . It is a different computer record? Yes, yes. In my photostat there is no title at all on that. Is that on yours? A 17 That is correct, and I have, if you like, my original is actually a photostat in itself. 18 106 Q 19 A 20 107 Q 21 A 22 108 Q Yes ? That is what I received. That is what you received? Yes . Yes. Could we just move on through these because 23 they are all the same and it is all your account and 24 I want to draw your attention to OA/S-14 25 A 26 109 Q 27 Yes . Do you see that is page 14. it? 28 A 29 110 Q (Exhibt 6)? Yes . It is a continuation of 1 2 111 Q 3 A 4 112 Q 5 A 6 113 Q Yes . Do you see that? I do, yes, yes. The next page shows the same account number and a 7 number of other ones show the account number. 8 you made aware by Mr. Collery that a further change 9 had occurred with where your funds were deposited at 10 Were this period? 11 A 12 114 Q We were in about November 1990 now? Yes. You divided up -- you closed one account. You 13 sent some of it, your wife took some of it and you 14 took the other and it was put into a new account. 15 Were you told by Mr. Collery? 16 A I wasn't told anything about that. The only thing I 17 requested was that when Mary and I were sending 18 money back that it was clearly identifiable what was 19 Mary's money and what was my money. 20 115 Q 21 A Yes? But I never asked Padraig to move my money from 22 Guernsey to any of these other places or whereever 23 it went. 24 116 Q 25 A 26 117 Q 27 A Yes ? I never made that request. Yes? Later, from memory again, in say 1991/92 I then 28 became aware that there was an "Ansbacher" link if 29 you like. 1 118 Q 2 A 3 119 Q 4 A 5 120 Q 6 A 7 121 Q 8 A 9 122 Q I think because it appeared on one statement. Yes ? Or something. That is what I was coming to? Yes, yes. I will draw your attention to it in a moment? Yes . However, it does appear that these new documents 10 that we have been looking at were from an account in 11 Guinness & Mahon in Dublin that was in the name of 12 "Ansbacher" Limited? 13 A 14 123 Q 15 Yes . It was a coded account and you were identified by the code number to which I have referred? 16 A 17 124 Q 18 A 19 125 Q 20 A 21 Correct. Was that made clear to you later on? No. However...(INTERJECTION)? In fact I never have any dealings I had with Padraig I never used that code number. 22 126 Q 23 A Yes? And the only time that I used the code number, when 24 I saw the "P" or the "M" behind the code, was to 25 identify what was Mary's money and what was my 26 money. 27 Yes. 28 from Mr. Collery that it was now in Dublin, in an 29 "Ansbacher" account in Dublin, is that right? In some way you became aware then, presumably 1 Well, no, I didn't think it was in Dublin and when I 2 was looking through my file last night it is 3 interesting I came across an instruction from when I 4 was in Portugal. 5 think Gudrun saying that the money has been 6 transferred to Guinness Mahon Guernsey as per my 7 instructions. 8 128 Q 9 A 10 129 Q 11 A There is a telex there from I Yes? And that was I think 1990 as well. Yes ? So, at that point -- I know it seems a bit 12 schizophrenic but even though Padraig was sort of 13 moving funds my impression was that my money was in 14 an off-shore account. 15 130 Q 16 A 17 Yes? And that whatever was happening with it was -- he had reasons for doing that. 18 131 Q 19 A For doing that. Yes? Now, at some point, and I can't say for sure if this 20 is sort of retroactive analysis on my part but I 21 think there was an issue, that because some of these 22 statements were given to me from Dublin that at one 23 point I felt the reason the tops were cut off was 24 that it was simply they were coming out on 25 Guinness & Mahon Dublin notepaper and they shouldn't 26 have been. 27 132 Q 28 A 29 133 Q I see? They should have been on "Ansbacher" or whatever. Yes? 1 But I cannot say for sure when that perception might 2 have been in my head. 3 Yes. 4 documents which is quite possibly you have not seen 5 them at all. 6 Appendix 7 of the file. 7 26th September 1990 (Same Handed) 8 A 9 135 Q I would just like to refer you now to some It is page 27 Mary please. It is It is the letter of the (Exhibit 7)? Thank you. I will just explain to you what this is: This is a 10 letter from Mr. Traynor to Mr. Humphries in 11 Guinness & Mahon in Dublin. 12 is headed ""Ansbacher" Limited" with the address in 13 the West Indies and then: 14 You will see the letter "Please reply to 42 Fitzwilliam Square." 15 16 That is Mr. Traynor's offices? 17 A 18 136 Q Yes . This is asking David Humphries to transfer a sum of 19 dollars to New York to the credit of -- the credit 20 is given: 21 "For further credit to a/c Patrick McCarroll... ."? 22 23 A 24 137 Q 25 A 26 138 Q 27 28 29 McCarroll, yes. I am sorry, McCarroll? Yes . Do you see then the following sentence: "Please debit the cost to Ansbacher Limited account number 13154 602. Advising sterling figures in due course"? 1 2 139 Q 3 4 I do not know whether you can recall getting that money in US dollars in 1990? A 5 I probably did but can I track it in my own accounts ? 6 140 Q 7 A Yes? Have you cross-checked with my account? 8 September 1990. 9 the transfer there, $4,875? 10 11 On my code OA/S14, would that be OA/S14 on mine and there is a debit to me there of $4,875 141 Q 12 (Exhibit 8). What page is that? MS. CUMMINS: 13 Page 107, Judge, in our brief. 14 MR. JUSTICE COSTELLO: 10...(INTERJECTION) 15 MS. CUMMINS: Page 107 of the brief. MR. JUSTICE COSTELLO: I am not absolutely 16 142 Q 17 certain we have it. 18 you been able to locate it? 19 A 20 143 Q 21 A 22 144 Q 23 A 24 I have it in mine here, yes. Where is it? But you should have a copy of it. Where? What is it? It is on my page "OA/S14." MS. MACKEY: 25 Yes. What transaction do you say it is? 26 It is the 3rd of the 10th. 27 MS. MACKEY: 28 29 Have one. I see. Do you see it Judge? It is the last You see the last transaction? 1 2 What I want to draw your 3 attention to is that you got that money and that the 4 money came from the "Ansbacher" account, that is 5 numbered there, in Dublin. 6 letter, Mr. Traynor's letter (Exhibit 7)? 7 A 8 146 Q 9 A 10 147 Q Yes. Is that clear from the I never saw this. Of course? This letter before. I am not for a moment suggesting that you knew Mr. 11 McCarroll that this happened. 12 you that that is, in fact, what happened? 13 A 14 148 Q 15 A 16 149 Q I am pointing out to It appears to be, yes. It appears to be? Yes, yes. Similarly, I want to draw your attention another 17 transaction and this is a letter of the 18 25th November 1990. 19 2...(INTERJECTION) 20 MS. MACKEY: It is page 29. MR. JUSTICE COSTELLO: Yes, it is at page 29. 21 150 Q 22 It is at page (Exhibit 10) It is the 19th February 1991 23 (Exhibit 10). 24 and it is a letter to Mr. Waite in Guinness & Mahon. 25 It is from Mr. Traynor and: 26 27 28 29 It is "Ansbacher" Limited's heading "Could you please arrange to credit the account of Mr. Patrick McCarroll with Ir£4,000 and debit the sterling equivalent to "Ansbacher" Limited... ." 1 2 151 Q 3 This was a sum being paid to you -- you had a resident account here in Dublin, I think? 4 A 5 152 Q 6 That is right, yes. You got £4,000 into that from the "Ansbacher" account? 7 A 8 153 Q 9 That is correct, yes. There is one other document that I want to refer you to and that is a letter of the 25th November 10 1992 and it is from Joan Williams to Mr. Redmond in 11 the Irish Intercontinental Bank (Same Handed) 12 (Exhibit 10)? 13 A 14 154 Q 15 Yes . Do you see that it is a different company, the notepaper. 16 It is headed: "Hamilton Ross Company Limited"? 17 18 A 19 155 Q 20 Yes, yes. With an address in Cayman. It is: "Please reply to 42 Fitzwilliam Square." 21 22 It is addressed to Irish Intercontinental Bank and 23 it is : 24 25 26 27 28 29 "Dear Ronan, would you please arrange to let me have for collection a sterling cheque for stg£20,000 payable to Mr. Patrick McCarroll and debit the cost to Hamilton Ross account," 1 156 Q Did you know that your funds were in the IIB Bank 2 in the name of a company called Hamilton Ross 3 Company Limited? 4 A 5 157 Q 6 7 No, I had no idea. Up to now have you ever heard of Hamilton Ross Mr. McCarroll? A I have heard of the name and I am not sure if it is 8 in connection with anything that was in the 9 newspapers or not but I know that I didn't believe 10 any of my money had anything to do with Hamilton 11 Ross . 12 158 Q Yes. You might have heard of it from the newspaper 13 accounts or do you think that Mr. Collery might have 14 said anything to you about it at any time? 15 A 16 I am afraid I can't say if Padraig mentioned anything about Hamilton Ross to me. 17 159 Q 18 A 19 160 Q Yes ? I just don't. I don't remember. Again, Mr. McCarroll does it not look as if 20 Mr. Collery and/or Mr. Traynor, or whoever in 21 Guinness & Mahon, for whatever good reasons they 22 considered justified it, moved your funds around 23 without telling you, is that the position? 24 A Yes. I think that if I received the money I would 25 have sent a letter or else had a phone call with 26 Padraig to say I needed funds for something and that 27 would have triggered this process. 28 Yes? 29 A But I mean I was not aware that Padraig was moving, 28 1 as it seems to have been, money from one institution 2 to another. 3 Yes. 4 not know whether you can remember it or not but 5 presumably no doubt he would have sent you that 6 money because you asked for it? 7 A 8 163 Q 9 A I mean for example the £20,000 in 1992, I do Yes, absolutely, yes. Yes? And I can't find it here but I know that we bought 10 our house in the beginning of 1993 and I suspect 11 that those funds might be something to do with that. 12 164 Q 13 A 14 165 Q For the deposit or something? Yes, yes. Yes. Mr. McCarroll, this letter was from 15 Ms. Joan Williams. 16 you know her? 17 A Had you met Ms. Williams? Did I think I met Joan once possibly twice and I know 18 that my wife, Mary, collected money once or twice 19 from the Cement Roadstone offices in Fitzwilliam 20 Square. 21 166 Q 22 A 23 167 Q 24 A 25 168 Q 26 A Yes. When? I think it was when I was away in Muscat. Yes ? Before Mary came out she collected money there. Yes. Did you ever yourself collect money there? I possibly did. I can't say for sure but I possibly 27 did. 28 Square once or twice. 29 169 Q I certainly was in the offices in Fitzwilliam 1 2 170 Q 3 4 You never met him. Why did you go to his offices in Fitzwilliam Square? A Because I had made an arrangement to meet Padraig, 5 either to collect money or to get a statement, and 6 usually -- well, it only happened once or twice but 7 we met close to there, sometimes in a pub; walked up 8 to Fitzwilliam; went in; Padraig would -- and I -­ 9 my memory now is that it was one or two statements 10 that I required and he would print off the statement 11 and give it to me. 12 171 Q 13 A Yes ? And I know that Mary was in once or twice. She 14 collected money to pay a tax bill when I had left 15 Ireland and that she collected cash from Padraig to 16 pay that tax bill. 17 172 Q That was in early 1993. Was any explanation given to you as to why you did 18 not go to the bank to get the money? 19 to Mr. Traynor's offices? 20 A Why did you go At that stage I found it strange when we were 21 dealing with Padraig and everything had moved out of 22 the Bank. 23 173 Q Out of the Bank? 24 A Out of the Bank. 25 174 Q 26 A Yes ? I mean when the connection with Fitzwilliam Square 27 -- I remember I think Mary went first, I am not sure 28 if she went first or Padraig had made an arrangement 29 to meet her there first, and I remember being 1 puzzled, I am not sure if I was here, as to why what 2 that was the case. 3 175 Q 4 5 Did Padraig explain it to you? A Well, I didn't. You see I was away and Mary...(INTERJECTION). 6 7 Did he explain it to you? 176 Q 8 When you came back you did not ask him, "Why have you moved from the Bank"? 9 A 10 177 Q 11 A 12 I didn't, no. Did you know that, in fact, he had left the bank? At a certain point I became aware of that but I am not sure exactly when I became aware of that. 13 178 Q 14 A Yes? As far as I remember I closed that account in 1993 15 for a number of reasons and it would have been some 16 -- shortly before that time that I became aware that 17 Padraig had left the bank. 18 179 Q 19 20 Did you sever your connections with Padraig then in 1993? A Not totally because socially -- if I was at home I 21 would sometimes ring him and just meet him for a 22 drink or so. 23 180 Q No, I should have made it clearer. What I am asking 24 you is about what happened to your funds which had 25 been on deposit which Mr. Collery was looking after 26 for you? 27 Mahon in 1993? 28 I did, yes, and I moved the funds, again from 29 memory, to a Standard Chartered off-shore account. Did you close your account with Guinness & 1 181 Q Yes. I am really not concerned with your private 2 affairs. 3 The Guinness & Mahon Group? 4 A 5 182 Q I am just concerned with "Ansbacher" and Right. Did you sever all connections financially with "Ansbacher" in 1993? 6 7 A 8 183 Q 9 A Yes . Yes? Yes, and I, from memory again, I think I had closed 10 my resident, my Irish, account in 1991. 11 the file any way. 12 184 Q Yes. It is in Was there any specific reason why you ceased 13 having a commercial relationship with Guinness & 14 Mahon or "Ansbacher" or Collery? 15 A I found that I was travelling a lot and we were away 16 and that it was a bit difficult having money tied up 17 with Guinness & Mahon, or that account with Padraig, 18 when I couldn't get credit card facilities on it. 19 Financial transactions had changed a lot and I 20 needed much more direct access to my own money. 21 185 Q 22 A 23 186 Q 24 A Yes? Whether it was credit card based or whatever. Yes ? This would again be very much a perception but I got 25 the feeling that Padraig was encouraging me, in 1983 26 or late 1992, to stop the connection with him on the 27 financial side. 28 Did he explain why? 29 He didn't, no. I remember mentioning it to Mary 32 1 afterwards and I said I felt that may be we were too 2 small. 3 188 Q Yes. We were not of interest to them. If we move on then Mr. McCarroll to some other 4 topics. 5 off-shore account in Guernsey too? 6 A In relation to your wife, did she have an We got married in 1986 and I had had my 7 Guinness & Mahon account, my Guernsey account, 8 since 1978. 9 189 Q 10 A Yes ? And shortly after we got married, in 1987/88/89, we 11 were working in the States and I think that during 12 that time I communicated with Padraig and I said, 13 "Mary is earning money in the States," and we put it 14 into an account with Guinness & Mahon 15 and...(INTERJECTION). 16 190 Q 17 A 18 191 Q 19 A What was your wife's occupation? An architect. She is also an architect. She is an architect? Yes, and when I got the letter in relation to this I 20 was actually surprised because I thought Mary would 21 get a letter too because I thought she had had an 22 account also. 23 192 Q 24 A Yes ? And then when we saw that she didn't get a letter I 25 said may be this code, the "P" and "M", was 26 something Padraig managed. 27 193 Q 28 A 29 Yes? To just identify the money, what was Mary's and what was mine. 1 194 Q 2 A 3 195 Q 4 But that is just surmising. So as I understand, it does appear then that your wife lodged money in Guernsey? 5 A 6 196 Q 7 A Yes . When she was in the States, is that right? Yes, the mechanism would be that we would have just 8 sent a cheque to Padraig, a dollar cheque may be, 9 and just credited it to the account. 10 197 Q I would like you to be a little more specific. You 11 see you had an account but it does appear from the 12 documents that your wife had an account too? 13 A 14 separate account. 15 198 Q 16 A 17 199 Q 18 A Yes? For a while. Yes ? And it is only recently because of the communication we received from you...(INTERJECTION). 19 20 Yes, I thought that my wife had an account, a 200 Q Leaving that aside, just tell me what you understood 21 to be the position? 22 wife had a separate account? 23 A 24 201 Q 25 26 Did you understand that your I thought my wife had a separate account, yes. Yes. Did you ever get, did she or you ever get, statements about it? A 27 Yes, and Mary has -- she didn't keep as complete records as mine. 28 202 Q 29 A Yes? 1 203 Q 2 A 3 204 Q Yes, absolutely, yes. You see the document that I referred you to earlier, 4 the closing of the College Trustee account -- it is 5 page 117 in ours and it is "OA/S-24" in yours. 6 Would you look up that (Exhibit 4)? 7 A 8 205 Q 9 Yes. There is a hand written note there at the left hand column which refers to a sum of "£11,369" with the 10 "/Mary" opposite it? 11 A 12 206 Q 13 14 Yes. That is correct, yes. That was money that was to be deposited in your wife's account, is that not right? A Well, I think that was already in the Bank and what 15 Padraig was doing there -- that is Padraig's hand 16 written note. 17 207 Q 18 A 19 It is not my note. It is hand written. It is Padraig's. It is Padraig's note? I have the original here (INDICATING). 20 208 Q 21 A Yes? And what Padraig was doing was probably responding 22 to a query from me saying, 23 two accounts? 24 calculations and then put the two together and gave 25 me a total figure. 26 209 Q 27 No. "What is the total in our Where are we," and he then did his However, I am asking you about your wife's account ? 28 A 29 210 Q Yes . There is a letter in the correspondence in which you 35 1 2 A. 3 211 Q. 4 A. 5 212 Q. 6 A. 7 There is, yes. Would you just look that up for me? I have a letter here "OA/C -1" (Exhibit 12). What is the...(INTERJECTION)? And I say: "I enclose the sterling equivalent of 1/3 of the cheque for $3511.00 for 10,553. Please deposit one-third in my a/c, one-third in Mary's a/c." 8 9 10 And one-third to somebody else. 11 213 Q. 12 A. 13 214 Q. Yes. This is in 1991. This is May 1991? Yes. You are referring to a third in Mary's account. It 14 is quite clear, is it not, that Mary had a separate 15 account? 16 A. 17 215 Q. 18 A. 19 216 Q. 20 A. 21 217 Q. 22 A. 23 24 218 Q. I believed she had a separate account. She has documents showing us that separate account? She has a few statements. A few statements? She has nothing like the extent of statements or Yes. Do you see there is another letter "OA/C-7" to Padraig? 26 A. 27 219 Q. 29 She had? correspondence that I have. 25 28 Well, as I said, yes. Yes. You say: ".... I reviewed the figures we discussed in approximately Sept/Oct '89..... " ? 1 2 3 220 Q 4 5 A 6 221 Q 7 A 8 222 Q 9 A 10 223 Q 11 "... Mary and myself corrected the amounts in our accounts"? Yes . You are referring to the two accounts? Yes . Is that right? Yes, yes. "However, we got mixed up. The balances were Mary £11,369.69" 12 and you £30,486.27? 13 14 A 15 224 Q 16 That is right, yes. Again, it is quite clear that she had a separate account? 17 A 18 225 Q Yes . There is an earlier reference in the correspondence 19 to a deposit opening in the name of, your then 20 fiancee, Ms. Claire Lynch in 1980? 21 A 22 226 Q 23 24 Was that opened, do you know, in the name of Ms. Claire Lynch? A 25 26 That is right, yes. My understanding was that it was and I think the amount from memory was about £3,000. 227 Q Do you know was it maintained, or was it closed, or 27 what happened to it? 28 I have no idea because Claire and I then split up in 29 1981. 1 228 Q 2 A 3 229 Q 4 A 5 230 Q 6 7 And you have no idea what happened? I have no idea what happened after that. Yes. Do you know if your father had an off-shore account at all? A 8 I don't believe he had. I can't say I am 100% sure but I don't believe he had. 9 231 Q 10 A 11 232 Q 12 A 13 233 Q 14 15 And she went her separate way and...(INTERJECTION). Yes. Did he ever mention it to you? No. That he had it? No, no. What would make you consider that perhaps he might have had it? A Well, I know that after he sold the company he was 16 encouraged by Guinness & Mahon to invest money with 17 them. 18 234 Q 19 A Yes ? My mother had very negative feelings towards 20 Guinness & Mahon generally and it created a certain 21 amount of tension at home, that my mother really 22 didn't want anything to do with Guinness & Mahon. 23 235 Q 24 A Yes ? And my father was being guided a bit by them. My 25 understanding was that quite shortly after selling 26 the company Dad actually moved away from them. 27 236 Q 28 A 29 From? From Guinness & Mahon. I don't even know if he ever had an account in Guinness & Mahon in Dublin. 1 237 Q. 2 A. 3 238 Q. 19? 4 A. 89. 5 239 Q. 6 A. 7 240 Q. 8 Yes. Is your father alive Mr. McCarroll? No, he died in 1989. 1989? Yes. Did your mother have an account? Do you know did she have an account? 9 A. 10 241 Q. No, she intensely disliked anything to do with them. Yes. There is reference in the correspondence to 11 investments. 12 your mother had had, apparently in some way 13 connected, with Guinness & Mahon. 14 this in the correspondence 15 A. Mr. Collery refers to investments that Do you remember (Exhibit 18)? Later in or about 1985 I took over the management of 16 my Mum and Dad's affairs because my Dad got 17 alzheimers and at one point while I was away I think 18 I invested some of Mum's money. 19 sure but I think I invested some of it for a while 20 in Guinness & Mahon in an account or something 21 managed by them, which I believe was managed by 22 Sean O'Dwyer. 23 242 Q. 24 A. 25 243 Q. 26 A. 27 28 29 Again, I am not O'Dwyer? Sean O'Dwyer, yes. Yes? I remember having some dealings with Sean O'Dwyer in relation to my Mum's affairs at that time. 244 Q. Yes. Do you know if that was invested out of the jurisdietion? 1 I don't. 2 time I would have been very careful about my 3 mother's status and her tax status. 4 Yes. 5 in correspondence that you had with, Mr. Collery it 6 is perfectly clear that you were on very friendly 7 terms with him. 8 reference to sums of money in the Irish language. 9 Mr. McCarroll, was that a code of some sort, or was 10 11 I don't believe it was because at that In some of the letters Mr. McCarroll had with, However, in some of them you make it a joke, or why was it done? A 12 I think that that might have been while I was in Nairobi. 13 246 Q 14 A 15 247 Q 16 A Yes? In the period about 1985/86. Yes? And at that time the Nairobi Government -- they had 17 a tax group. 18 but they were a very -- a much feared 19 Kenyan Government outfit and my concern, I think, at 20 that stage would have been more concerned with the 21 Kenyan tax situation rather than the Irish tax 22 situation. 23 248 Q 24 A 25 249 Q 26 A I can't remember the name of the group Yes ? I wasn't worried about the Irish tax. Yes ? But I was concerned that if these people got in and 27 started checking what we were doing in a business 28 sense that it could, you know -- it would be 29 difficult for us to deal with it just purely in 1 administrative terms even. 2 250 Q 3 A 4 5 Yes ? All expatriates in Kenya and in Zimbabwe at that time feared the local tax authorities. 251 Q Yes. Was this an instruction then to Mr. Collery 6 with regard to investing these sums somewhere, do 7 you remember? 8 A 9 I think I remember a reference to a Se Cead. Is it 600? 10 252 Q 11 A That is right. Yes? And as far as I know, as far as I remember, it 12 sounds like it was a regular payment. 13 probably find out if I ...(INTERJECTION). 14 253 Q 15 A 16 254 Q I could If you would have a look? If I did a search I could probably find out. Yes. We will take a break now perhaps. 17 Mr. McCarroll, you can have a cup of tea or a cup of 18 coffee if you like here for about ten minutes? 19 A 20 255 Q 21 A 22 256 Q 23 A Yes . And you might take the opportunity to look? I will have a look. And see at your leisure? There is another document that might be of interest 24 to you and that is that after I sent the file into 25 you I was corresponding with the Revenue and they 26 requested me to do a more detailed statement with 27 regard to my residency. 28 257 Q 29 A Yes? And it might be relevant if you had a copy of that 41 1 2 258 Q. Very well. That would be very helpful. Thank you. 3 4 5 SHORT ADJOURNMENT 259 Q. MR. JUSTICE COSTELLO: 6 We will resume then Mr. McCarroll and 7 Ms. Mackey would like to ask you some further 8 questions ? 9 A. Yes. 10 11 END OF EXAMINATION OF MR. PATRICK McCARROLL BY 12 MR. JUSTICE COSTELLO 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 MS. MACKEY: 3 4 MS. MACKEY: Mr. McCarroll, we were 5 talking there just before 6 the break about references that you made to sums of 7 money in Irish? 8 A 9 261 Q Yes . And we located those particular documents during the 10 break. 11 our brief. 12 (Exhibit 15 & 16)"? 13 A 14 262 Q 15 If we could have, Mary, page 174 and 176 of It is your "OAC-26" and "OA/-C-28 Yes . If we look at "OA/C-26" you have that one there, do you (Exhibit 15)? 16 A 17 263 Q 18 A 19 264 Q 20 A 21 265 Q 22 2 6, yes. It is a letter from you from Nairobi in 1986? Yes . To Padraig Collery? Yes . Down on the third and fourth paragraph there you say: 23 "Also please do se cead to the same address as before"? 24 25 A Yes, I have actually tracked it down. When I was 26 in Kenya I stayed originally with a person called 27 Roger Steadman. 28 2 66 Q 29 A Yes? And my agreement with Roger was that I paid him 43 1 rent. 2 friend of mine and roger had an account, and he may 3 even have had an account with Guinness & Mahon at 4 one point. 5 267 Q 6 A I stayed in his house with him. He was a Yes ? And I paid him rent. Now, I can't remember but I 7 don't think it was 600. 8 was something in the region of 150 a month, again 9 from memory. 10 268 Q 11 A 12 I think the rent I paid him Yes ? Because I found a number of transfers and that would be the only regular transfer. 13 269 Q 14 A Yes? As far as I can remember that I would made during 15 the time that I was in Kenya. 16 -- all of those do se cead are multiples of either 17 150 or 300, which I was sending to pay Roger for 18 staying in his house. 19 270 Q Right. So, I think that that Similarly, then at "OA/C-28" there is 20 reference to 3 - se cead to the same address as 21 before? 22 A 23 271 Q 24 A 25 272 Q 26 A 27 273 Q 28 A 29 274 Q Yes . And that is 1985, it is the previous November? I think that is the same. That would be the same? Because it would be -- again it is a multiple. Yes? Like it is the same. Yes? 1 2 275 Q. Yes. You mentioned just there before the break in 3 relation to that that you thought the reason for 4 putting it in Irish was probably the fear that 5 people living in Kenya had of the group at the time 6 that was working on behalf of the Government for the 7 Revenue? 8 A. 9 276 Q. 10 Yes. Could you tell us a little bit more about what your fear actually was there? 11 A. 12 277 Q. 13 A. Well, I was staying with Roger at that point. Yes? And I noticed that earlier -- in earlier 14 correspondence I wrote to Padraig and said, "Just 15 transfer money to Roger." 16 278 Q. 17 A. Yes? And then subsequently I turned it into transferring 18 Irish amounts. 19 could be that I mentioned to Roger how I was 20 managing the transfers and he was a Kenyan resident. 21 He was an English person but he worked in Kenya for 22 a long time and had taken up residency. 23 protect them. 24 279 Q. 25 A. 26 280 Q. 27 A. Now, I am surmising here but it It was to To protect him? Him in that situation? Yes? But, in what I said earlier, I would have been very 28 conscious of my role because if it became apparent, 29 because I was managing a company in Nairobi, that I 1 was making payments like this it would also get our 2 company into difficulty. 3 281 Q 4 A In what way? Well, because I was making a payment to Roger, and 5 the reason I was making it to him was so that he 6 wouldn't have to pay Kenyan tax on that money. 7 282 Q 8 A 9 283 Q 10 A 11 284 Q 12 A 13 285 Q 14 Right, right. Was he involved in the company? No, no. No? No, he was just a friend. It was just because you as manager of the company? Yes . You feared that would have implications for the company? 15 A 16 286 Q 17 A 18 287 Q 19 A 20 288 Q 21 A 22 289 Q Implications, yes. That you were...(INTERJECTION)? That I was managing it. Enabling a Kenyan...(INTERJECTION)? Facilitating that type of thing. Facilitating? Yes . I see. Can I -- these are all little bits and 23 pieces and winding up of loose ends that I am doing 24 here now? 25 A 26 290 Q 27 Okay. Can I ask you to have a look at another letter you sent us? 28 A 29 291 Q Sorry, I just have to locate it here now? Okay. Yes, it is your "OA/C-104". 46 Page 218 of our 1 documents. 2 Yes, 104, yes. 3 This is going back now to 1979 and it is a letter 4 that you wrote. 5 where the letter was written from but it is 6 addressed to Martin of Guinness & Mahon, which I 7 take to be Martin Keane? 8 A 9 293 Q Have you located it yet (Exhibit 17)? It is un-headed. We do not see Martin Keane, yes. Yes. This is the stage that you were talking to us 10 earlier about, where you began to find that it would 11 be useful to have a cheque book or credit card 12 facilities and you were asking if it was possible to 13 have one with G & M in Guernsey and you say: 14 "Please write and let me know if it is feasible for me to have a current account with G & M in Guernsey..." 15 16 17 and then in brackets, 18 "(or advisable)"? 19 20 A 21 294 Q 22 A Yes . Why were you saying that? Because at that time, when I went away, the whole 23 question of residency and domicile was very 24 confused. 25 295 Q 26 A Yes ? And my father, when I was going away, advised me to 27 get advice and I got advice from a senior person in 28 KPMG. 29 296 Q In KPMG? 1 2 297 Q 3 A 4 Who was that? He is still in KPMG in Cork, Sean -- I can get the name. 5 298 Q 6 A 7 299 Q 8 A 9 He is a partner, I think, in Cork. In KPMG in Cork? In cork. Right? And his advice was that for clarity you should avoid any -- even though I was away I was non-resident and 10 that. 11 can't remember them now but he said the source of 12 the money that I was getting paid, it must be clear 13 that it wasn't from Ireland and that I mustn't have 14 it domiciled here and a number of other issues. 15 300 Q 16 A 17 He said -- there were a number of things. I Yes? And when I was doing any transactions like this and I had just -- I had gone away in 1978. 18 301 Q 19 A Yes ? And I would have been extremely nervous that my 20 non-resident status was clear and that there was no 21 ambiguity and that I couldn't actually somehow be 22 brought back into the tax net. 23 302 Q 24 A 25 26 Yes, yes? And it would be in that context that I wrote something like that. 303 Q Right. Why would you think it might not have been 27 advisable for you to have a cheque book in relation 28 to an off-shore account? 29 A 1 which was GBWA International, which was an 2 International company branch of an Irish company, 3 Gleason Byrne Wheelan. 4 time...(INTERJECTION). I know that during my 5 304 Q 6 A Gleeson Byrne WhelanGleeson Byrne Wheelan. 7 A Whelanright. 8 A And I know that during my period with them they did 9 Sorry, what was the Irish company? make a mistake in a payment to me and they in a 10 subsequent revenue audit -- actually this arose and 11 they said, "Well, you have made a payment from 12 Dublin to me". 13 305 Q 14 A 15 306 Q 16 A 17 307 Q 18 A Yes? And you should, you know. Right? "Is it liable for tax?" Yes ? And I don't know the detail. I know that they got 19 into a bit of trouble about that and I think that 20 they actually had to pay that. 21 308 Q 22 A 23 309 Q 24 A Yes? I am not sure about that. Yes, yes? But the expats at that time -- I mean it was very -­ 25 you were very nervous when you are away about trying 26 to maintain your non-residency status. 27 310 Q 28 29 Yes, yes. letter? A Can I ask you to look then at another It is "OAC/30" Exhibit 18)? 1 311 Q 2 This is a letter from Mr. Collery to you when you were in Kenya in October 1985? 3 A 4 312 Q 5 A 6 313 Q 7 Yes . He is giving you various pieces of information? Yes . However, in the third paragraph he says: "Last week I had a visit from one of the tenants with the rent." 8 9 Were these tenants of your apartment building in 10 Killiney? 11 A 12 314 Q 13 In Killiney, yes. "He said he is going to pay it direct to me each month; do you wish to be advised each time on receipt." 14 15 16 17 Why were the tenants paying Mr. Collery? A 18 was going into my local account. 19 315 Q 20 A 21 316 Q 22 A 23 Was Mr. Collery dealing with your local account? Yes, yes. He was? My Guinness & Mahon account. I had two accounts in Guinness & Mahon. 24 317 Q 25 A 26 318 Q 27 A Yes ? One was an Irish resident account. Yes. Do you know which account it went into? I gave you copies. No, I haven't cross-checked that against...(INTERJECTION). 28 29 I presume they were just -- I think that that money 319 Q 1 2 3 320 Q 4 Yes. What I am really asking you about is, at the time did you know which account it was going into? 5 A 6 321 Q I ...(INTERJECTION). I mean I presume the tenant did not come to 7 Mr. Collery without previous arrangement by 8 yourself? 9 A 10 322 Q 11 A 12 Or instruction to the tenant to go to Mr. Collery? No, I would have asked. I think that tenant was a person called -- I think it was Harry Merrick. 13 323 Q 14 A 15 324 Q 16 A 17 325 Q 18 A 19 326 Q 20 21 No, no. Yes? And Harry would have sent the money into Padraig. Yes? On a regular basis. Yes ? And...(INTERJECTION). What normally happened to the rents? Where did they normally go? A 22 In 1985 I can't remember it. I mean occasionally I might have got my sister to collect the rent. 23 327 Q 24 A 25 Yes ? And -- now, again I am surmising here because I can't remember. 26 328 Q 27 A Yes? But I presume I set up an arrangement like that just 28 so that my family wouldn't have to be involved in 29 collecting rent. 1 329 Q 2 A 3 330 Q 4 A 5 331 Q You mean over a period how many different tenants? No, at a given time? It was Harry and a friend of his, two guys. Right. It was just one apartment, was it, that you had? 6 7 A 8 332 Q 9 A 10 333 Q 11 One apartment, yes. I see? Yes, yes. Yes. This would relate to the entirety of the rent then? 12 A 13 334 Q 14 Yes . It was not just one tenant paying rent to Mr. Collery? 15 A 16 335 Q 17 A 18 336 Q 19 A 20 337 Q No, it was ... (INTERJECTION) . And the other tenants...(INTERJECTION)? No, it was everything. Yes, I see? That was all the rent. Yes, I see. Mr. Collery asks you, do you wish to be 21 advised each time of receipt. 22 you wanted at that time or whether...(INTERJECTION)? 23 A 24 Do you recollect what I don't recollect but knowing how I dealt with him over many years I would have said "no", you know. 25 338 Q 26 A 27 Yes ? All I wanted was to see occasionally on a statement that everything was Okay. 28 339 Q 29 A Yes? I mean I didn't even get regular statements sent to 52 1 me when I was abroad. 2 my sister's house or my Mum's house. 3 340 Q They tended to go to either However, for your resident current account, that 4 would have had regular statements, wherever they 5 went? 6 A 7 341 Q 8 A 9 342 Q 10 A 11 343 Q 12 A Yes, that is the one I am referring to. Yes? And...(INTERJECTION). There would have been regular statements? Regular statements. Yes ? And they went to either, I think, my -- you have them all any way. 13 14 344 Q 15 A 16 345 Q 17 A 18 346 Q 19 A 20 347 Q Yes? To my sister or my mother. Yes ? But they weren't sent out to me. Yes. I understand that? Wherever I was. I see. If it is was going into your regular current 21 account, would it not have been normal that the 22 tenant would simply pay it into the Bank? 23 A 24 I presume so. I mean I can't remember why he, Harry, just didn't write a cheque and send it in. 25 348 Q 26 A Yes ? I know that when I went away first and I rented the 27 apartment then I didn't declare it and then I went 28 in under an amnesty and declared everything and the 29 apartment and after that point paid all the tax. 1 349 Q 2 A 3 Was there an amnesty before that? I think it was an earlier one. 4 350 Q 5 A 6 351 Q 7 A 8 352 Q 9 1988, yes? 1988 because I was actually away in 1993. Yes? And I had a lot of other difficulties at that time. Yes. I must just ask you is there any possibility that this money was going into you off-shore 10 account? 11 A 12 353 Q 13 A 14 354 Q I don't think it was but I would have to check. Yes ? Back through the accounts. Yes. Do you know what the amount of the rent was? 15 I mean would it -- presumably it would not appear in 16 your "Ansbacher" account as rent from Mr. Murray? 17 A 18 355 Q 19 A 356 Q 22 I know that it would have been in the region of £300 Yes. It appears that it appears in your current account Mr. McCarroll? 23 A 24 357 Q 25 A 26 358 Q 27 A 28 359 Q 29 Merrick? a month, something like that. 20 21 Merrick. Okay. Yes, thank you very much? Okay. Merrick? Merrick, yes. Yes, thank you. Another matter I wanted to ask you about Mr. McCarroll is about one of the documents, 1 one of the statements, you sent into us. 2 reference "OA/S-24" 3 A. 4 360 Q. It is your (Exhibit 4)? Yes . This is this statement in which we see transactions, 5 both of you and of your wife, appearing and it was 6 the one in which the money was divided up between 7 you, the end balance. 8 transactions there, it is the fourth and third last: However, one of the 9 10 "4th September 1989 - Gartmore proceeds (M). Gartmore proceeds (Pat)"? 11 12 A. 13 361 Q. 14 A. Right. What does that relate to? I think that that was an investment, that money that 15 I put into an investment and I thought that I had a 16 statement. 17 the end of the documents I sent to you -- yes, my 18 reference "G/S-l" 19 362 Q. 20 A. 21 363 Q. 22 A. 23 Did I give you a statement of that? (eXHIBIT 19). G/S? "G/S-l". Yes? It is towards the very end of my set of documents. MR. JUSTICE COSTELLO: 24 25 At Perhaps you could give us this? 364 Q. MS. MACKEY: 26 Perhaps you could. We do not seem to have that with 27 us today. 28 A. 29 365 Q. Yes (same handed) Thanks. (Exhibit 19). This is an investment that Guinness & Mahon 1 2 Yes, as far as I can remember, yes, and I am not 3 sure if I set that up with Padraig or with Sean. 4 can't remember. 5 that. 6 We would have a copy but we just have not got it 7 with us today. 8 tell me a little bit more about it? 9 Well, I, just from memory, had money. 10 I I think you should have a copy of Is was an investment. Could you I had a balance in the off-shore account. 11 367 Q 12 A Yes ? And I probably, during discussions with Padraig at 13 some point, felt that I should may be invest it in 14 something that had a possibility of some capital 15 growth. 16 368 Q 17 A Yes ? I know that at the time, about 1990, I was concerned 18 that -- Padraig's advice to me was always very 19 conservative in terms of finance and his advice was 20 always to keep quite a lot in cash. 21 369 Q 22 A Yes? And at about 1989/90 I felt that I should -- with 23 the money I had saved, that some of it, should be in 24 something that offered potential. 25 370 Q 26 A 27 371 Q 28 A 29 Yes ? To have some capital growth. Yes? And it would have been in that context that I would have -- I can't remember if I talked to Padraig or 1 to Sean. 2 to get involved in situations like that. 3 372 Q 4 Yes. It tended to be Sean. Padraig didn't tend You used a balance from your off-shore account to...(INTERJECTION)? 5 A 6 373 Q 7 A 8 I ...(INTERJECTION). What was Gartmore? I am not exactly sure. It was just some kind of a fund that they explained...(INTERJECTION). 9 374 Q 10 A 11 375 Q 12 A 13 376 Q 14 An Irish fund, was it? I don't think so because it is external capital. Yes ? The statement is external. Yes. However, it was on the advice of either Mr. Collery or Sean...(INTERJECTION)? 15 A 16 377 Q 17 A 18 378 Q 19 Sean O'Dwyer. 0'Dwyer? As far as I can remember, yes. Would you have a look Mr. McCarroll at "OA/C-20" (Exhibit 20)? 20 A 21 379 Q 22 Yes . This is a letter from you in the US to: "Dear Eilis". 23 24 25 Do you know who that is? A 26 ©ilis, no. I assume it is somebody in Guinness & Mahon. 27 380 Q 28 A 29 381 Q Right? But I can't remember it. 1 "I enclose a draft for $8,000. Please put (approx) $5,000 in Gartmore as discussed..."? 2 3 4 5 Yes . 382 Q 6 "...and $3,000 in Swiss Francs"? 7 8 A 9 383 Q 10 11 Yes . That is undated -- well, it is dated 11th March but there is no year on it? A We might be able to see if it is on one of the 12 statements. 13 was another external capital statement, which 14 would be "$/S-l" and the date on that is the 15 21st March 1988 16 384 Q 17 A 18 385 Q 19 A Right. Yes, I gave you another document which (Same Handed) Thank you. (Exhibit 21). Yes? And I think there is £8,000. There is, yes? You will see a debit and a credit of $8,000 going in. 20 21 386 Q 22 A And that...(INTERJECTION)? Now, I am not sure -- I don't know where the 23 relation to Swiss Francs or what happened on that. 24 Does that tie in in terms of money? 25 387 Q 26 A 27 388 Q 28 A Yes, would have been I guess...(INTERJECTION). 29 389 Q Appears in a dollar account here of Guinness & So this is a draft...(INTERJECTION)? Yes, "I enclose a draft"...(INTERJECTION). This draft which you sent to Eilis? 1 2 A. 3 390 Q. 4 A. 5 Right, yes. In your name? And I don't know if it was transferred into Gartmore then. 6 391 Q. 7 A. 8 392 Q. 9 A. 10 393 Q. 11 A. No, there is no...(INTERJECTION). It is immediately withdrawn then again? Withdrawn, yes. Transferred to new account, is it? To new account. Yes? Possibly to the Gartmore account. The only 12 statements I have for those accounts are the two I 13 have given you. 14 394 Q. I don't have...(INTERJECTION). You see the other one that you gave us -- it simply 15 says it is a sterling account. 16 foreign currency accounts basically that you have 17 shown us? 18 A. 19 395 Q. 20 A. 21 396 Q. These are two Yes. In Guinness Mahon Bankers? Right. And one is a sterling account and the other is a 22 dollar account. 23 transactions relating to Gartmore. 24 credit of Gartmore proceeds? 25 A. 26 397 Q. 27 The sterling account refers to There is a Right. Then a second credit of Gartmore proceeds and then the full amount is withdrawn, interest is added on? 28 A. 29 398 Q. Right. The other then -- so that seems to be the beginning 1 and the end of that particular sterling account 2 (Exhibit 19). 3 A. 4 399 Q. 5 A. 6 400 Q. 7 It starts...(INTERJECTION). It starts with a nil balance? Yes. And it ends with a nil balance after those two transactions ? 8 A. Although the statement number is four. 9 401 Q. It is strangely, yes. 10 A. So...(INTERJECTION). 11 402 Q. 12 A. Have we three -- we do not have three or two? No, I don't have. I mean I have given you everything I have. 13 14 403 Q. 15 A. 16 404 Q. 17 Yes? In my records. Yes. However, nevertheless it begins with a nil balance? 18 A. 19 405 Q. 20 A. 21 406 Q. 22 Yes. Balance brought forward - nil? Nil, yes. The sterling one, similarly, is statement number one in that case (Exhibit 19)? 23 A. 24 407 Q. Yes. However, it begins at nil balance and then we have a 25 cheque lodged, which is a draft for $8,000 of which 26 according to your letter, $5,000 would relate to 27 Gartmore but $3,000 is some other transactions? 28 A. 29 408 Q. To Swiss Francs. To another, yes. Yes, which does not seem to have anything to do with 1 2 3 No. 409 Q 4 These would not be strictly speaking be Gartmore statements or accounts of Gartmore? 5 A 6 410 Q 7 A No. These are...(INTERJECTION)? I mean when I came across these in my records I 8 couldn't remember the detail of these and I just put 9 them in. 10 411 Q Yes, yes? 11 A The file. 12 412 Q 13 14 Did you have a number of foreign currency accounts with Guinness & Mahon? A 15 Well, these investments -- I regarded these not so much as foreign currency accounts. 16 413 Q 17 A 18 414 Q 19 A 20 Yes ? I regarded them as an investment. Yes ? And that is the way it was portrayed to me by Guinness & Mahon. 21 415 Q 22 A 23 Yes? That I had some money -- I put some money in, invested it. 24 416 Q 25 A 26 417 Q 27 A 28 29 Yes. Yes ? Mainly for capital growth. Yes? Now, my memory is that I didn't have -- I didn't keep those accounts for a long time. 418 Q Yes. This does not seem to 1 2 3 Yes . 419 Q 4 5 That you keep them any longer than a month or thereabouts ? A Yes, but I wouldn't have -- I mean it would have 6 been very usual for me in the States at that time to 7 be in communication with Padraig on a monthly basis. 8 420 Q 9 A 10 421 Q Yes? So, that is usual. Because this letter of yours to Eilis, while you are 11 asking to put $5,000 of the $8,000 into Gartmore, 12 that would be the investment. The $3,000, you simply 13 seem to want to exchange or put into Swiss Francs? 14 A 15 No, that was an investment account also. Swiss Francs was actually...(INTERJECTION). 16 422 Q 17 A The name of a ...(INTERJECTION)? It -- well, I was advised by Guinness & Mahon that 18 Swiss Francs -- they thought currency -- the 19 Swiss Franc was going to increase in value. 20 423 Q 21 A 22 424 Q 23 A 24 425 Q 25 It is a foreign currency account basically? Yes, it seems it was. Yes? Yes, yes. Looking back again Mr. McCarroll at"OA/S-24" (Exhibit 24? 26 A 27 426 Q 28 A 29 427 Q "OA/S-24". The one we started with there? Yes . Where there is the reference to the Gartmore 1 proceeds. 2 now closing that particular account, and dividing -­ 3 showing the division between your wife and yourself? 4 A. 5 428 Q. Where you were closing, or as it appears Yes. The two transactions in relation to Gartmore 6 proceeds seem to be relating both to you and to your 7 wife, is that right? 8 "Gartmore proceeds proceeds (Pat)." 9 (M). Gartmore 10 11 Do you see that there? 12 A. 13 429 Q. 14 A. 15 430 Q. 16 A. 17 431 Q. 18 A. 19 Yes, yes. Had your wife also invested in Gartmore? I didn't remember that she did. Yes? But obviously this is in her name. Yes? There is the one above that: "Sale of..." 20 21 something, 22 "...BFA bonds (Mary)". 23 24 432 Q. 25 I see that. Mary, yes. Then we see Swiss Francs just underneath that; do you see that? 26 A. 27 433 Q. 28 A. 29 434 Q. 30 A. Yes. Swiss Francs 3,9...(INTERJECTION). 3,962? ...62, yes. It looks like those...(INTERJECTION). Which is a credit? 1 They were credited so these were closed and credited 2 into my off-shore account then. 3 435 Q You would consider that this was the closing of your 4 Swiss Franc account and the transferring of it into 5 sterling or whatever this was? 6 A Yes, because my recollection of the Swiss Franc 7 account and of the Gartmore is very -- I mean I have 8 very little documentation and my memory of it is 9 very scanty. 10 436 Q 11 A 12 13 Right? So, I think it was something that just was for a short period. 437 Q 14 Alright. You do not know whether Gartmore was in sterling or...(INTERJECTION)? 15 A 16 438 Q 17 A 18 439 Q 19 A 20 440 Q 21 A 22 441 Q Unless I can tell it from the statement. The statement is in sterling? Sterling. That talks about the proceeds of Gartmore? As to which one? Which one are we on? That is the "GS/-1" Sterling. (Exhibit 17)? Yes, its sterling, yes. You were saying to us earlier, when we were looking 23 at the statement that appeared to have their tops 24 cut off, that, you know, you were a bit bemused and 25 amused by this when they began to arrive but that 26 you -- if you talked to Mr. Collery about them at 27 all he was rather vague in his explanations as to 28 why this might be done but you believed he had his 29 reasons and so on. However, there is a reference in 1 one of your letters to him to these statements and 2 it is a letter that we find at "OA/C -7" 3 13) . 4 A. 5 442 Q. 6 A. 7 443 Q. 8 A. 9 444 Q. 10 (Exhibit Yes, I think I called them "headless", did I? You did, yes? Yes. You called them headless statements? Yes. This is the letter, in fact, referring to that final statement we were just looking at (Exhibit 19)? 11 A. 12 445 Q. 13 Right. Where you are correcting the balances attributable to you and to your wife? 14 A. 15 446 Q. 16 Right. You go on to say: "Mary has deposited $6,000 since then and has not made any withdrawals. So, her balance should be in the region of . . ." 17 18 19 and you give a figure," "...including interest. To check my own balance I would need one of your headless statements for the period Sept 89 to date"? 20 21 22 23 A. 24 447 Q. Right. I just, you know -- I wonder why you specifically 25 asked there for a headless statement. 26 appreciate the slight may be amusement there in the 27 tone. 28 statements would be coming, you know, headless and I 29 just wonder was this something that at this stage I mean I However, you seem to accept that the 1 was totally accepted between you and Mr. Collery? 2 Well, I mean as you can see that 80 % or 90% of the 3 statements that I got from him had the tops cut off. 4 448 Q 5 A Yes ? And my -- I suppose my analysis or my -- when I 6 speculated that about that, and again some of this 7 is kind of retroactive. 8 449 Q 9 A 10 450 Q 11 A Yes? So, I am not sure. Yes ? But as I -- I have said it already that part of it, 12 certainly initially, was that I felt just for 13 administrative purposes Padraig was printing 14 statements in Dublin that in theory should have come 15 from, as I thought at the time, Guinness Mahon 16 Guernsey. 17 451 Q 18 A 19 452 Q And that it would have wrong for him to do that. Yes. You thought it would be wrong for him to do that? 20 21 Yes, yes? A I thought that it would be wrong for 22 Guinness & Mahon in Ireland -- I didn't know 23 anything about banking quite frankly. 24 453 Q 25 A 26 Right? But that one bank in Dublin should not be printing out accounts. 27 454 Q 28 A 29 455 Q Right? From another bank in Guernsey. Yes? 1 And that this was a way where he could tell me just 2 what I had in the bank and chop the top off it. 3 456 Q 4 A I see, yes? But also there was this, or it did create this, kind 5 of aura and it was that, you know, somehow this, you 6 know -- that there was something special about this 7 account and that, you know. 8 457 Q 9 you dealt directly with Guernsey? A 12 458 Q 14 A 15 459 Q 16 Yes? I am not sure now. I just wonder why you changed and began to deal with Guinness & Mahon Dublin or how that came about? A 18 19 I think that there is one -- my first one or two letters may have been with Guernsey. 13 17 You said there earlier that initially when you went away after you had opened the Guernsey account 10 11 Yes. From memory I think Padraig just said, easier. 460 Q 20 "Look, its Just deal with me directly". We are going back now to the early 1980's, would that be right? 21 A 22 461 Q 23 A 24 462 Q 25 That is right, yes. Yes? Yes . Had you been dealing with Mr. Collery prior to that or was it Mr. Keane? 26 A 27 463 Q 28 A 29 464 Q Initially I was dealing with Martin Keane. Yes? And then about 1980 I think. Yes? 1 A. 1980/81 I started to have contact with Padraig. I 2 met Padraig, you know. 3 into the Bank to see Martin and he introduced me to 4 Padraig, and I met him at that point, and then it 5 seemed that he was taking other my affairs. 6 465 Q. 7 A. If I was in Dublin I went Right? And then I just dealt with him and I got on very well with him. 8 9 466 Q. 10 A. 11 467 Q. 12 A. 13 468 Q. 14 A. Yes. In relation both to you resident account? Resident and...(INTERJECTION). And to the other one? Yes. He dealt at all times with both? Yes, because again I think -- again I can't remember 15 for sure but I think I had an agreement with him 16 that I could run an overdraft in my Dublin account. 17 469 Q. 18 A. 19 470 Q. 20 A. 21 Yes? And if my overdraft went above a certain amount. Yes? He could -- he would then transfer. So, when I was away I didn't have to worry about it. 22 471 Q. 23 A. 24 472 Q. He managed it? He managed it for me. What happened to the management of your resident 25 account when Mr. Collery left the Bank? 26 have told us about going to meet him, you know, in 27 Fitzwilliam Square and so on? 28 A. 29 473 Q. I mean you But I ... (INTERJECTION) . However, who was dealing then with your resident 1 2 3 474 Q 4 A 5 6 I am not sure when he actually left the bank but I closed it in 1991. 475 Q 7 8 You closed it before Mr. Collery left the Bank? Right. Would that have been one of the reasons why you closed it? A 9 No. In fact with regard to my resident account I got the distinct impression that they really didn't 10 want me. 11 1 ...(INTERJECTION). 12 476 Q 13 A I dealt with Chris Waite and You did not deal with Mr. Collery then? No, I got a letter. I think I was in Portugal. I 14 got a letter from Chris to say that they had 15 reviewed my situation and that they were, you know, 16 wondering would it be better if I didn't have an 17 account there. 18 477 Q 19 A 20 478 Q 21 A 22 Right? Because...(INTERJECTION). Do we have that letter here? I don't think -- wait until I see now. It was about 19...(INTERJECTION). 23 479 Q 24 A 25 480 Q 26 A 27 481 Q 28 A 29 That was the way it was put to me. It is just that I do not recollect seeing it? On"CA/C-l" (Exhibit 22) . CA/C-1? Yes. CA/C -1 current account. We do not seem to? Yes, and "CA/C-5" is the letter from Chris Waite to me.(Exhibit 23) . 1 482 Q 2 A 3 483 Q Wait until I just have a look now. May be you could pass us just that to have a look at 4 because we do not seem to have it in our copies, if 5 you do not mind? 6 A 7 484 Q 8 A 9 (Same handed) (Exhibit 23). Thank you? Now, I remember when I got that letter I was again a bit bemused because he wrote the letter as if I had 10 sort of pushed the whole thing 11 about...(INTERJECTION). 12 485 Q I was just going to say: 13 "You have decided to close your current account"? 14 15 A Yes, but the feeling was very much that they -- I 16 got the feeling that they wanted me to close the 17 account at that time. 18 486 Q 19 Have you the letter of the 31st May, your own letter, there 20 A 21 487 Q 22 A 23 488 Q 24 A 25 489 Q 26 A (Exhibit 24)? Yes . That is referred to? I have, yes. Could we may be just look at that? Yes (Same Handed) (Exhibit 24). Thank you? I know is sounds -- it seems to contradict a little 27 bit what I say but I know that was the feeling I had 28 at the time. 29 490 Q That certainly seems to say that you have decided to 70 1 2 3 1 ...(INTERJECTION). 491 Q 4 And he replies and says: "I note that you have decided to close it"? 5 6 A But I think there was either communication or may be 7 a telephone call before that. 8 base it on but I remember having the distinct 9 impression at that time that they wanted me to close I have nothing to 10 the account. 11 just -- it was a memory that has hung with me all 12 that time. 13 492 Q Yes. Again, I don't know why. I mean I Because if you were dealing with 14 Padraig Collery at all times in relation to your 15 resident account then presumably any feeling that 16 you would have got would have been from him? 17 A 18 493 Q 19 A 20 494 Q 21 A 22 495 Q Normally, yes, but the...(INTERJECTION). Would you mind if we took copies of these? You should have them. We have them? Yes . Grand. Thank you. The feeling you would have got 23 would have been from him and then you wrote directly 24 to the Bank: 25 "Dear Sirs." 26 27 I mean it is not directed to him and Mr. Waite 28 writes back to you? 29 1 ...(INTERJECTION). 1 4 96 Q 2 A Now, again it is from memory but my feeling was that 3 anything I dealt with Padraig was in a much more 4 informal way and that. 5 had a telephone chat with Chris Waite or whatever 6 but I remember my feeling at the time being that I 7 was being encouraged to close the account. 8 497 Q 9 A 10 498 Q 11 A 12 499 Q 13 A I had -- I don't know if I Yes? Now, I don't know why I still have that with me. Yes ? It irked me at the time I remember. Yes ? And I remember thinking that one of the reasons was 14 that I was running my resident account really with 15 an overdraft just ticking over. 16 doing anything with the account. 17 500 Q 18 A 19 501 Q 21 A 22 And that Padraig was topping it up from time to Yes? So, really I was using it for domestic spending when I was at home in Ireland. 23 502 Q 24 A 25 503 Q 26 A 27 29 Yes ? time . 20 28 So, I wasn't really Yes ? From time to time. Yes ? Now, again I can't -- I know the correspondence seems to give a totally different picture. 504 Q Yes. One of the things that we are required to look into is, as you know we are investigating 1 "Ansbacher" the company and not individual persons 2 who might have been clients or otherwise of it? 3 Yes . 4 505 Q However, one of the things we are required to look 5 into is whether "Ansbacher" conducted its business 6 with intent to -- in such a manner as to enable 7 creditors of third parties to be defrauded in some 8 way or another and in many cases that relates to the 9 Irish Revenue as being a creditor of a third party. 10 You have explained to us that you were non-resident 11 during all this time so that this would not apply to 12 you. 13 away in different countries have been liable to pay 14 tax to those countries. 15 you declare the taxes that you were obliged to 16 declare to the Revenue authorities of those 17 countries or did you use your off-shore account to 18 enable you not to do so? 19 A You would however during the times you were I must just ask you: Well, it varied a lot depending on which country you 20 were in. 21 countries like Oman, there is no income tax. 22 506 Q 23 A 24 507 Q 25 A Did In the middle East, in for example Right? In Kenya there was income tax. Yes ? And the arrangement that I had with my partners in 26 Kenya was that I received a local salary on which I 27 paid tax. 28 508 Q 29 A Yes? But I also received a certain amount of money that I 73 1 2 509 Q. 3 A. 4 5 Yes? So, I did not pay, if you like, the full amount of tax. 510 Q. 6 Now...(INTERJECTION). When you say you received, this was your salary you are talking about? 7 A. 8 511 Q. 9 A. 10 512 Q. 11 A. This was my salary, yes. You declared part of your salary? In Kenya, yes, yes. Yes? And that would have been a standard. Even companies 12 that were hiring people and setting up businesses in 13 Kenya that was...(INTERJECTION). 14 513 Q. So part...(INTERJECTION)? 15 A. That was kind of accepted. 16 514 Q. 17 A. 18 515 Q. 19 Right? Most expats in Kenya would have done it. What would happen was they would pay you part of your salary on the books as it were? 20 A. 21 516 Q. 22 A. 23 517 Q. 24 A. 25 518 Q. The other part of your salary, what happened to it? 26 A. Well, initially when we bought the company in Kenya Yes. I mean I was paying myself. And that would be declared? Because I was running the company. You were paying yourself? Yes. 27 I had no -- I didn't have access to a large amount 28 of funds and I was setting it up with two partners 29 and they agreed that they would pay some of my -­ 74 1 just top up my salary because my local salary would 2 have been very small. 3 519 Q 4 A 5 Yes ? And from memory that salary was something like £15,000 a year. 6 520 Q 7 A 8 521 Q 9 A 10 522 Q 11 A 12 523 Q 13 A 14 524 Q 15 A 16 525 Q Yes? While I was in Kenya. Yes. What they were paying? Yes . This was the bit that was not being declared? Yes, yes. Where did that go and what happened to it? That went into Guinness & Mahon. It went into "Ansbacher"? "Ansbacher" here. In relation to -- you were working in -- where else 17 did you say you worked? 18 places. 19 A Portugal: You worked in lots of You were in Portugal, is that right? The company Euroactivade, who I worked 20 for, they had a similar arrangement and 21 w e ...(INTERJECTION). 22 526 Q Similar to Kenya? 23 A Similar to Kenya. 24 527 Q 25 A 26 Now, I was an employee in the company. I had no interest in the company there. 27 528 Q 28 A 29 Yes ? Yes? And there we received an official salary. We paid tax on that salary and in addition they paid us a 1 2 529 Q 3 A 4 530 Q 5 Yes, yes. In Kenya you were not an employee. You were a Director basically? 6 A 7 531 Q 8 A 9 532 Q 10 A 11 533 Q 12 13 Did that go into your "Ansbacher" account as well? That is right, yes. Yes. That company was called Euroactivade? No, that was called Vamos International. Vamos. How do you spell that? V-a-m-o-s. Vamos International. Right. That was Portugal. The States? A The States: We were hired -- it was a very 14 complicated situation. 15 Saudi Arabian company and sub-contracted to work 16 with a large American company and we didn't pay any 17 tax at all. 18 534 Q 19 A We were hired by a You were not obliged to pay tax, was it? Well, as far as I know that was the situation. 20 went -- we got a special type of Visa. 21 working on military work for the US Government. 22 535 Q 23 A 24 536 Q 26 A 27 29 We were Right? And we got a special Visa to allow us to go in to work. 25 28 We Right? And we got paid our money through the Saudi Arabian company. 537 Q Right. That salary; would that have been lodged to your...(INTERJECTION)? 1 A lot of that salary would have. 2 have been held in a dollar account that we had in 3 St Louis. 4 538 Q 5 A 6 539 Q 7 A 8 Part of it would That the company had? No, that I had. That you had? That we had. When we were living in the States we had a dollar account there. 9 540 Q 10 A 11 Right, yes. And the rest? And occasionally, and I am doing this from memory again. 12 541 Q 13 A 14 Yes ? Occasionally I might have sent cheques to Padraig to lodge to the Guinness & Mahon account. 15 542 Q 16 A Yes. Sudan: So we have Nairobi. Sudan? I didn't pay any tax at all. When I went 17 there I -- one of our local advisors was an 18 accountant. 19 543 Q 20 A Yes? And when I discussed the tax situation with him he 21 said that at that point Sudan -- the taxation system 22 was not really well developed at all and that there 23 wasn't a facility there apparently to tax 24 non-residents. 25 544 Q 26 A 27 545 Q 28 A 29 Right? To tax expatriates there in Sudan. Yes? And his advice was, "Don't do anything. find you when— "...(INTERJECTION). They will 1 546 Q 2 A So, I didn't. 3 declare. 4 anything. 5 547 Q 6 A 7 548 Q 8 A 9 549 Q 10 11 Well, it is not even that I didn't I mean I was just advised not to do You did nothing? Yes . However, you did not pay tax? No. Your salaries from there then, would they have gone to Padraig? A They would have gone -- again, some of them would 12 have gone to Padraig but while I was in Sudan I had 13 a dollar account and a local account, from memory, 14 in the local City Bank. 15 550 Q 16 A 17 551 Q 18 A 19 552 Q 20 A 21 553 Q 22 A 23 554 Q 24 A 25 555 Q We have...(INTERJECTION)? 26 A If I go...(INTERJECTION). 27 556 Q Saudi Arabia -- wait now? 28 A 29 557 Q Yes? In Khartoum. Right. However, some would have gone to Padraig? Some would have gone to Padraig, yes. Okay. Has that covered everywhere you were? I am lost now. We have Oman, we have Sudan? Yes . We have Portugal, we have the States? Yes . No, it was a Saudi Arabian company. 1 2 558 Q Yes ? 3 A Yes . 4 559 Q 5 A 6 560 Q I think that seems to be everywhere except Ireland? That seems to be everywhere. During the time that you were resident in Ireland 7 did you use your "Ansbacher" account in any way 8 to...(INTERJECTION)? 9 A The only -- again, I would have to check it but the 10 only thing I did would have been to top up while I 11 had m y . ..(INTERJECTION). 12 561 Q 13 A 14 Resident account but I closed the resident account in 1991. 15 562 Q 16 A 17 18 Resident? Yes? So, all the dealings in that would have stopped at that point. 563 Q Right. Mr. McCarroll, during the times that you 19 were resident in Ireland, when you would be making 20 tax returns, did you include in those tax returns 21 the interest that would have accrued on your 22 off-shore account? 23 A The particular period that I think that that refers 24 to would be 1991/92, that tax year, and I didn't 25 declare that. 26 564 Q 27 A 28 565 Q 29 You did not? Yes. I checked my records a few nights ago. I do not think I have any further questions. just ask you to look at one more document Can I 1 2 Which one. 3 5 66 Q 4 A 5 567 Q 6 A 7 568 Q 8 "Dep/4-6" I think it is (Exhibit 25). OA, is it. No. It is DEP/A? DEP, it is a deposit account. And then a 6. It is a letter of the 12th January 1977 9 A 10 5 69 Q 11 A 12 570 Q 13 (Exhibit 25)? Is that my reference or your reference? It is yours? Is it in mine, sorry. It is yours, DEP. I think it refers to...(INTERJECTION)? 14 A 15 571 Q 16 A 17 572 Q 18 A 19 573 Q 20 A 21 574 Q 22 A 23 575 Q 24 IEP, yes, is it? Is it IEP? Is it? Deposit account, sorry, yes, DEP. Deposit account? Where abouts? That is at the back, Okay. Yes, it is near the end of your file? Yes, yes. Right. I see you have it now, have you? Yes . It is a letter of the 12th January 1977 (Exhibit 25) ? 25 A 26 576 Q 27 28 577 Q 29 A Yes . From Mr. Keane to you? MR. O'MALLEY: DEP and what number? MS. MACKEY: Number 6. 1 He refers to your recent letter in connection with 2 the Revenue query as to where you obtained the 3 £10,000 : 4 "I would suggest that you reply to them in due course and "state that it was a gift from your father." 5 6 7 Can you tell us what that is about? 8 A 9 579 Q 10 A 11 580 Q 12 A Well, I have already told you that. Right? I.e. when my father sold the company. Yes ? He made a gift to my sister and myself of £10,000 each. 13 14 581 Q 15 A 16 Yes? And in my case he deposited that. He opened a deposit account for me. 17 582 Q 18 A 19 583 Q Yes ? In Guinness & Mahon. Yes. It seems from this that you had written to 20 Mr. Keane asking what you should tell the Revenue 21 about it, is that it? 22 A 23 584 Q 24 A Well, I got a query from the Revenue. Yes ? Before I was going way. Wait until I see. 25 1977. 26 me how come I had an income. 27 585 Q 28 A 29 That is I think I got a query from the Revenue asking Yes? Because in 1977, January 1977, I would have just started working. I got my degree in 1976. 1 586 Q 2 A 3 587 Q 4 A So, in late 1976 I started working in Dublin. Yes ? And I got, again from memory, a query from the 5 Revenue about my tax affairs and then I said I had 6 an income from some money I had on deposit. 7 588 Q 8 A 9 589 Q 10 A 11 12 Yes? And they said, "Where did you get this money?" Yes ? And then I told them. I wrote to them and said that I got it as a present from my father. 590 Q However, before you wrote to them you wrote to 13 Mr. Keane to ask him about it. 14 you should ask Mr. Keane what you should say it was? 15 A 16 I suppose I didn't have an accountant looking after my tax affairs at the time. 17 591 Q 18 A 19 Yes ? And I just -- I was only out of college and I just wanted advice from somebody. 20 592 Q 21 A 22 593 Q 23 24 I just wonder why I see? On what to do. I see. Thank you very much. I have no further questions ? A Yes . 25 26 END OF EXAMINATION OF MR. PATRICK McCARROLL BY 27 M S . MACKEY 28 29 1 2 That is all we have to ask 3 you about. 4 your wife's account, separate account. 5 write to her in due course. 6 explain to her that we need all the documents that 7 she may have? 8 A 9 595 Q We will have to take up the matter of Very good. Thank you. MS. MACKEY: 11 here in Dublin, is it? A 13 5 96 Q Your wife, her address is Yes, it is the same. MS. MACKEY: It is the same address as 14 here? 15 A 16 597 Q Yes . MS. MACKEY: I suppose you would not 17 be able to give us an 18 19 I am sure you can Yes . 10 12 We will address for Ms. Lynch, would you? A I don't know. She married somebody who works for 20 the -- she married an American guy who works for the 21 American Embassy and they have been posted all over 22 the world. 23 MS. MACKEY: 24 So, I don't know where she is at the moment. 25 MS. MACKEY: I see. 26 MR. JUSTICE COSTELLO: Mr. McCarroll, we would 27 28 29 Yes. I see. ask you to come in when this has been typed up to sign the transcript. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW WAS THEN CONCLUDED i a 6 (s-£ 3 McCarroll, ESQ CP Cail V 71 211 1170 1 am 30 03 21 21 19 Mnr DEC JAM FEB K&R 79 79 80 80 80 Brought Forward T£r Saycballea 26/11 30 HOT 79 Chq Aurican Exprasa- 21 JAM 80 ChqAaarican Expraaa 21 FEB 80 Carried Forward 300.00 90.56 352.09 12.585.75 12.085.75 11,995.19 11.643.10 11.643.10 1 DATE ACCOUNT NAME C/P GUINNfcSS MHON GUfcPfcSlV CURRENCY STEALING ACCOUNT DESCRIPTION NO N R E S I D E N T CALL DEPOSIT LID ACCOUNT NUMBER LEDGER PARTICULARS . • ’ 26N0V79 1«? 500.00 . '• . ' :. . H • ’b . " .1 . • ** • • ' • *' ** • # .<{ f *" *• ■ . ; ‘ . fri 1 • _ ■■ . • '. BALANCE J ■ U Tr CREDIT DEBIT VALUE DATE ♦30NOV79 B^LANCt BROUGHT fORWARD •11D6C79 TSF TO 6EN€»AL s10fcC7v STATEMENT DATE • '/ GUINNESS MAtfON CAYMAN TRUST LIMI1 ACCOUNT P C / F COLIEGE TRUSTEES LTD CZJ DATE -T cumifNev STERLING ACCOUNT NON RESIDENT CALL - D E S C R IP T IO N deposit ' JO. B o x B 87 G m d C aym an TW ax C P 3 0 0 NAME • PARTICULARS LEDGER • j - V b r t a f BALANCE dROUGHt FORWARD 3*5rE B 8?.. RE US* 3 0 5 2 0 - 4 ■ PUT BY COLLEGE TO AMEX * ¥ 3 9 Y EB82. LODGED . 'Z £ f£ B B 2 RATE CHANGE ' ' \^tMAR82 INTEREST * • . •* *>• •* • . j. ■» •• .* • • • s* • •* * % •• /. 09.FEB82 12FEB82. 12FEB82 £: T a ta p h o n * N o 9 - 4 6 S 3 /4 A C C O U N T NUM BER 98270/02/65 ffTATSMKHT DATE 31HAR8? CREDIT ' , DEBIT VALUE DATE r-p- B r itb h W a it I n d ia t C a t* A d d ra n G u h m n s BALANCE -V* - !' 16;400*.00 ; 1/227.57 1**117.37 • znz.ti : ' - I . *• 14.00 •• ' 0.00 . ' 8 3 5 . 7Z 1#49<>«2l -1,4vA.2t • 66<-.4E .V M /• . • • • v . •• •1 ••• . 1., * •s >. « « • •• . < t. \ ■ * «• * / • * » • •r*- • . .• i • ••- « •>H ■ • M* •»*■.? • \ . !* *•* * * . / * • a • ! * , . ..V • . • . • ' 7~ ** w & . 1/10/90 1/10/90 3/10/90 Jl/10/90 V ______ 1/10/90 1/10/90 3/10/90 BHQUGHT FQflWARD TO H S4873 ACCOUNT mJMBER 80001632 PAGE BALANCES SHOWN ARE IN: S t e r lin g 590.00 1000.00 2613.94 14 33418.02 • 31868.02 * A Member ofthe Henry Ansbacher Holdings PLC Merchant Banking Group P.O. Box 887, Grand Cayman, British West Indies Phone: (809) 949-4653/4 Telex: CP 4305 * F i r (809) 949-7946 (809) 949-5267 Please reply to: . 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 26th September, 1990. M. David Humphries, Esq./ Senior Manager - Operations, Guinness & Mahon Limited, 17 College Green, DUBLIN 2. Dear David, . Could you please arrange to wire transfer US$4,875.00 to Morgan Guaranty Trust C o . , 23 Wall Street, New York, N.Y. 10005'', U.S.A. ' A.B.A. ' ’ 021 000 238 • ' for credit to .Prudential Bache Account 72200011* . for further credit to A/C Patrick McCarroll ESY-420586-8R Please debit the post to Ansbacher Limited Account N o . 13154602 advising Sterling figure in due course’. Yours / J.D. Traynor. to ^ . r f\j tn v ' - DAIf. 1- VALUE 1 ' DATF. p i/io /y o [ 5 /1 1 /9 0 15/11/90 JO / 1 1 / 9 0 3 /1 2 /9 0 3 1 /1 2 /9 0 - De^Liit’TiLj’. BROUGHT FORWARD Ift 4000 ■ i ___ _ < 29254.08 3720.(50 25534.08 B R O U G H T FORW ARD 3 /1 2 /9 0 3 1 /1 2 /9 0 I n t e r e s t t o 31/12/90 i)\\ < 350.00 955.84 24984.08 \ UJ-J J l/1 2 /9 0 c a r r ie d f o r w a r d 25939.92 I!) J \ \ u ^ Iy ftmherafth• Htrtry Ansbacherffo^Hngs PLC AttrchantBanking Group P.O. Box 887, Otind Cayman. W ia Phone (809) 949-4653/4 Tele* CP 4305 Fax: (809) 949-7946 • (809)'949-5267 Please reply to: 42 Fitzwffliam Square, Dublin 2. Tel: 765144/763065 Fax; 612035 1 9th February, 1991 C. Waite, Esq., .. Guinness & Mahon Limited, 1 7 College Green, DUBLIN 2. Deaf Chris, rvn-ii j W SjT"plefl p** a r r S n g s t o c r e d i t t h e A c c o u n t of M r . ^ & L c k M c C a r r o l l w V M 8 4 , 0 0 0 . 0 0 and d e b i t t h e S t e r l i n g gequiva w^^p^**"'. ...... . lMM< ••«««• (M* I ••• •• IH »»«» » «* »ll V M*'»«**»MM« M i M t B lt 'l t • • n«i»ini, ■■>n...- *. COLLINS Joint Inspectors 3rdFloor Trident House Blackrock Co. Dublin fc-iiipkjChambers 3 Burlington Road Dublm 4 Tel: +353 1 202 6400 Fax: +353 I667 5200 D.X 25 Email: !awyer@efcie Website: www.efc.ie By post & by fax: 2833929 ourref TL/PH/M23660.001 Re: yourref 28 September 2001 Ansbacher (Cayman) Limited Our client: Mrs. Mary Meagher -McCarroll Patrick McCarroll (deceased) ■ 'Jl Dear Sirs, We refer to your letters of 18th September 2001 addressed, in the first instance, to our client personally but also as the legal personal representative of Patrick McCarroll deceased. We represent Mrs. Meagher - McCarroll both in her own right and as executrix of her late husband’s estate and are corresponding with you therefore in respect of both letters. We appreciate that the late Mr. McCarroll was formerly represented by John P. O’Malley & Company but they are aware of our present involvement. We mention, as an aside, that your correspondence to our client arrived on the anniversary of her husband’s death. We refer to the statements attached to your two letters and to the preliminary conclusion in each instance that both the late Mr. McCarroll and his widow Mrs Mary Meagher - McCarroll were clients of Ansbacher. We find such a conclusion, and particularly its non qualification, perverse in ali the circumstances that exist and the evidence that is available. We propose to deal with the findings in each case separately: 1. Mr. Patrick McCarroll (deceased) In a statement preceding your preliminary conclusions at paragraph 3, you accurately detailed Mr. McCarroll’s background. The contents of paragraph 2 are of particular relevance and includes the sentence “it would appear that his funds, in common with those o f many persons whose funds were managed by College Trustees, were deposited subsequently in Ansbacher Partners . [■\ • .■ • ■; Uioi.te;vV U.nxj;i!i Dc-.-cii:o-,or ferryLengott GernrU Coil Bosr, G'rk-li Leonora Malone David uuitreli Associates S.uinn (W'oniTLk Mary E Barrett lohn Costello HilaiyO'Sulhvan l.-lianHalpm Ronan G'MeJijf Po;Si::;ih Obouih Kelly William .Yyimer Nicola I'.'.;''rMtn Pavid 1 Consultants Margaioi Buike-Staunton Ruth Finlay without his knowledge. ” (emphasis added). Despite this apparent acceptance of fact, you conclude that the late Mr. McCarroll was a “client” of Ansbacher. We attach an extract from the Oxford dictionary which defines the word client as follows “a person using the services of any professional; a customer”. In our view such a relationship is based on contract, one of the essential criteria of which is to form an intention to create legal relations. We ask rhetorically how one can form legal relations with an entity of whose existence you are blissfully unaware? In the exhibits attached to your statement there are included statements from G + M Bankers. It was to this institution that Mr. McCarroll lodged his money in the belief that an offshore account had been set up for him in Guernsey. Some of the statements originate from the bank in that jurisdiction and only one of those we have seen makes reference “Guinness & Mahon Cayman Trust Limited”. We would also refer you to the evidence given by the late Mr. McCarroll in his interview with you on 19thJune 2000 when he was very clear in his testimony about the nature of his relationship with Guinness & Mahon and his instructions to Padraig Collery with regard to his funds. Although the narrative contained in your statement reflects the late Mr. McCarroirs status as a non-resident, no-where is this referred to in your preliminary conclusions. You will doubtless be aware of the stigma attaching to anyone found to be the holder of an Ansbacher account. If Mr. McCarroll had been knowingly such an account holder (which is patently not the case) there would have been nothing untoward about that situation because throughout the years in question Mr. McCarroll was resident and working outside the jurisdiction and was not therefore subject to Irish Income Tax. You will be aware from his evidence to you that he took professional advice on his position and was careful not to contravene Irish tax laws. If it is still your intention, despite everything we have said, to persist with your preliminary conclusions, it is absolutely essential that you qualify that finding by inclusion of the additional facts:- (a) Mr. McCarroll’s alleged status as a client of Ansbacher was without his knowledge; and (b) Mr. McCarroll was non resident for tax purposes throughout the period in question and was therefore fully entitled to maintain an offshore account. 2. Mrs. Mary Meagher McCarroll Everything we have outlined in respect of the late Patrick McCarroll applies equally in relation to his wife. All the more so in her case because she appears not to have instructed Guinness & Mahon directly but relied on her husband to do so. No attempt was made by the late Mr. = McCarroll to hide the fact that his wife also had an account with Guinness & Mahon and that these funds were held offshore because there was nothing unusual or unlawful in that situation. Again we would contend that is all the circumstances of the case and in the light of the evidence made available to you, it is perverse to conclude that Mrs. Meagher McCarroll was a “client” of Ansbacher. If you nonetheless persist in this finding it would be contrary to the principles of fairness and natural justice if you did not qualify your findings in the same way as we have outlined above in Mr. McCarroll’s case. We look forward to hearing from you and would emphasise that all communications should be directed to this office. Yours faithfully, < r ^ Eugene F. Collins \Nefc\sys\users\phackett\septO l\ineag2Sinsp.doc Appendix XV (76) Mr Liam McGonagle, deceased 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Liam McGonagle. a) Letter o f 30 March 1988 - Liam McGonagle to Guinness and Mahon. b) Guinness and Mahon internal memo o f 16 August 1978 - TRL to JD Traynor. c) Letter o f 11 May 1990 - Martin Lanigan-O’Keeffe to JD Traynor. d) Transcript o f evidence o f Mr Desmond Turvey dated 16 July 2001. Correspondence received from or on behalf of Mr Liam McGonagle. a) Letter of 15 November 2001 from Kennedy McGonagle Ballagh to Inspectors. s o l ic it o r s UAM A IfcOONAOU >L K M A T n m v 20 N O RTH UM BERLAN D RO AD D U B L IN 4 ATTENTION MR. PAT O'DWYER 30th March 1988 Meaars Guinness & Mahon Ltd., 17 Collage Green, Dublin 2. CAMILLE INVESTMENTS LIMItED (LIAM 0. McGONAGLE) Deer Sire, I wish to inform you thet I propose to put the above-nemed Company, Camille Inveataente Limited, into voluntary liquidation next month. The Company ie wholly owned by me, end a ll ita lie b ilitie e w ill be diacharged. In the circumstances Cemille w ill not now naed to avail of the loan fa c ility aet out in your latter dated 3rd February 1984. Accordingly, I should be greteful i f you would cancel the fe cility end elso the guarantee given for Cemille by Liele Investment Company Limited. : Yours faithfully, LIAM D. McGONAGLE TO: FROM: RE: Deo T u r v e y r e q u e s t e d a s h o r t t e r m f a c i l i t y fo r the above Company, This a su itab ly o f £ 1 2 0 ,0 0 0 .0 0 t o be r e p a i d i n e a r l y S e p t e m b e r . aa i t is against d o llara, t h e r a t e t o b e c h a r g e d on t h e f a c i l i t y o v e r o u r Base Lending R a ts . is 3% Ie secured s itu a tio n , If' a form al f a c i l i t y could see to t h i s m eantim e but l e t t e r r e q u i r e s t o be done p e r h a p s P a t on h i s r e t u r n f r o m h o l i d a y s . I h a v e a s k e d t t. ttc L . t o h o l d d o l l a r s 3 0 0 , 0 0 0 . 0 0 h e l d on d e p o s i t f r o m G . n . C . T . TRlsAB...... ..... 16th. August, 197S In th e in ex cess o f to our o rd er. llth May 1990 MLOX/CC Mr. J.D. Traynor, Anabachar Limited, c/o 42, Fitzwilliam Square Dublin 2. " :n tax Das * refer to your letter of 17th April. The attached schedule sets out the account details requested as at 3lst March 1990. I have discussed this list briefly with padraig, but if there are any queries perhaps you would let me know. Yours sincerely. / Latter of Credit Facility £ 100,000 £ atg.e 20,692 7 0 ,0 0 0 £ 308/343 Stg.£1,280,576 Liam McGooagle . £ £ £ 130,000 (GBM) 58,324 10,357 £ 156,576 £ 4,410 £ Stg.£ Stg.fi 200,196 35,000 35,000 8tg.£ 140,000 £ £ 50,000 (As guarantor for various facilities) 25,496 UNDER OATH ON MONDAY, 16TH JULY 2 0 0 1 I hereby c e r t i f y the f o l l o w i n g t o b e a t r u e and accurate tra n sc r ip t shorthand n o tes o f my in the a b o v e named i n t e r v i e w . Stenographer The I n s p e c t o r s : HIS HONOUR JUDGE O'LEARY MS. MACKEY BL S o l i c i t o r to the Inspectors: MS. M. CUMMINS In terview ee: MR. DES TURVEY R e p r e s e n t e d by: MR. JAMES DALY CROSSKERRYS 35 MERRION SQUARE DUBLIN 2 WITNESS MR. D. TURVEY I EXAMINATION JUDGE MS. MACKEY PAGE 89 88 98 1 2 3 4 5 JUDGE O'LEARY: Mr. Turvey, we h a v e r e c e i v e d your l e t t e r 6 7 of the 8 MR. 9 JUDGE O'LEARY: 1 6 t h J u l y a nd n o t e TURVEY: it's contents. Thank y o u . My name i s 10 Sean O'Leary. I am o n e o f t h e 11 a p p o i n t e d by t h e High Court t o 12 of reporting 13 reporting 14 There a r e c e r t a i n 15 t h a t we h a v e t o 16 a lim ited 17 However, that 18 which i s to 19 a resp on sib ility on t h e Company. on i n d i v i d u a l s . extent is aspects consider the qu estion We a r e n o t r e a l l y It is t h e Company. o f o u r wo rk w h i c h m ea ns in vestigate to a cer ta in the a f f a ir s of the and t o ind ivid u als. s e c o n d a r y t o our o v e r a l l t a s k in vestigate t h e Company an d we h a v e a nd a d u t y t o do t h a t . 20 21 I n o r d e r t o do s o we c a n a s k p e o p l e who m i g h t h a v e 22 inform ation, 23 t o come and h e l p u s i n t h a t o r may h a v e i n f o r m a t i o n , to assist us regard. 24 25 From i n f o r m a t i o n w h i c h we h a v e a v a i l a b l e , 26 which i s particu larly 27 w ill see in a short w hile, 28 that y o u m i g h t b e a p e r s o n who c o u l d a s s i s t 29 regard to secret and a l l none o f o f w h i c h y ou we h a v e r e a s o n t o b e l i e v e i n f o r m a t i o n w hich you m ig h t h a v e . us w ith A lot Insp 1 of th is 2 y ou rself. 3 MR. 4 JUDGE O'LEARY: inform ation d e a ls with people TURVEY: R ight. However, 5 6 o th e r than it is of the nature of th in g s we h a v e t o a s k p e o p l e t h e s e that kinds o f q u e s t io n s . 7 8 The s y s t e m w h i c h we a r e u s i n g i s 9 system . We, a most in fo r m a l m y s e l f and my f e l l o w Inspector 10 Ms. 11 w ill 12 answer t a k in g w hatever tim e t o t h in k as a p p r o p r ia t e 13 in a l l N o r e e n M a ck e y, who i s on my r i g h t - h a n d s i d e , a s k y o u a number o f q u e s t i o n s w h i c h y o u c a n the circum stances. 14 15 We n o t e t h a t 16 y o u a nd h e i s 17 the course 18 to c o n s u lt w ith your s o l i c i t o r 19 free feel you have b r o u g h t your s o l i c i t o r v e r y welcome. of the q uestions with I f a t any t im e d u r in g you f e e l you would l i k e b y a l l m ea ns f e e l t o do s o . 20 21 Sim ilarly, 22 c o n s u l t w i t h you he i s 23 t o a d j o u r n f o r a f e w m i n u t e s a nd t o h o l d t h a t 24 con su ltation . 25 MR. 26 JUDGE O'LEARY: if your s o l i c i t o r TURVEY: feels perfectly We w a n t i t free possib ly 29 anybody o u t . can. free to a s k us Yes. 27 28 t h a t he s h o u l d It is That i s t o be as s t r e s s f o r you as i t n o t an e x e r c i s e in catching not the purpose of the 1 2 3 There r e a l l y 4 t h e e v id e n c e which i s 5 a nd s e c o n d l y u l t i m a t e l y t h e t r a n s c r i p t w h i c h i s 6 b e i n g t a k e n o f t h e e v i d e n c e w i l l be p r e s e n t e d t o 7 you f o r t h e p u r p o s e o f s i g n i n g ; 8 is 9 MR. 10 is accurate. o n l y t wo f o r m a l i t i e s . That i s TURVEY: given JUDGE O'LEARY: S o, 12 today, 13 Ms. Cummins, 14 the o a t h t o y o u a n d we w i l l 15 then; 16 MR. 18 19 20 21 22 23 24 25 26 27 28 29 a ll tak en under oath t o make s u r e i t a ll. lik e is that R ight. 11 17 is One i s the first, a nd i f y ou the o n ly formal p art the q u estio n o f the tak in g of the oath. who i s our s o l i c i t o r , w ill a s k you a few q u e s t i o n s right? TURVEY: adm inister Thank y o u . 1 2 3 4 5 1 Q. JUDGE O'LEARY: Mr. 6 I should say t h e r e a r e a number o f 7 different 8 we w a n t t o d i s c u s s 9 such headings 10 C h a r t e r s Ltd? 11 A. 12 2 Q. 13 A. 14 3 Q. 15 A. 16 4 Q. 17 A. 18 5 Q. 19 A. 20 6 Q. 21 headings, is quite d iscreet headings, w i t h you t o d a y . The f i r s t that of a company c a l l e d K i n s a l e Y a c h t Yes. A re y o u f a m i l i a r w i t h t h a t I am b u t I h a d t o t a l l y Company? forgotten it. I understand that? It is so lon g ago. I understand th a t o f course? Bu t I am f a m i l i a r w i t h i t , y es,. Y e s? At l e a s t I was f a m i l i a r w i t h i t , I suppose b e fo r e that yes. I should la y the foundation. You a r e b y p r o f e s s i o n ? 22 A. An a c c o u n t a n t . 23 7 Q. An a c c o u n t a n t ? 24 A. 25 8 Q. 26 A. 27 9 Q. 28 A. 29 Turvey, Yes. You a r e a Member o f t h e C h a r t e r e d I n s t i t u t e ; I am, yes. Yes. Have y o u p r a c t i s e d a s an a c c o u n t a n t ? No, no. is it? 1 2 11 Q 3 A 4 No, I q u alified a nd I d i d n ' t go i n t o p r a c t i c e q u alifyin g. 5 12 Q 6 A 7 13 Q 8 A 9 You d i d n o t g o i n t o p r a c t i c e ? Yes . Where d i d y o u s p e n d y o u r w o r k i n g l i f e ? I had s e v e r a l p l a c e s . C orporation o f 10 14 Q 11 A F irst Ireland a f t e r Subsequent to th a t The I r i s h t o t h a t The C r e a t i o n Group, 13 a nd p u b l i s h e r s . 14 15 Q 15 A 16 job in the Insurance q u alifying. Yes ? 12 I reme mbe r t h e m , Follow ing th a t yes. Times. Subsequent which were p r i n t e r s Yes? F i n n e g a n M en t on L i m i t e d ; estate agents. 17 16 Q 18 A Yes ? I left them. 19 left 20 c omp a ny i n 21 I r e l a n d Ltd. 22 17 Q 23 A 24 18 Q 25 A t h em i n It is easier t o reme mbe r now. 19 84 a n d w e n t t o work i n an a i r Dublin A irp o rt I freight c a l l e d O 'R e illy A erlod Y e s? I stayed there u n til 1994 o r t h e r e a b o u t s . Yes ? When t h e Company was t a k e n o v e r an d t h e p e o p l e 26 who t o o k i t over announced t h a t t h e y d i d n ' t 27 people 65 f i v e 28 depart. 29 after over years of age. So, employ I had t o 1 With a v e r y a t t e n u a t e d p e n s i o n b e c a u s e 2 m e a n t t o h a v e w o r k e d on u n t i l 3 p e n s i o n would have been p r o p e r l y funded e t c . 4 20 Q 5 A I was I was 7 0 a nd t h e Yes ? And when my p r e v i o u s employer, F i n n e g a n M en t on , 6 h e a r d w ha t h a d h a p p e n e d t h e y c o n t a c t e d me and a s k e d 7 me w o u l d I l i k e 8 three 9 21 Q 10 A 11 come b a c k a n d wo rk p a r t - t i m e ; or f o u r d ays a week. Yes ? Three or f o u r h a l f days a week i n o r d e r t o p r o d u c e some i n c o m e f o r m y s e l f . 12 22 Q 13 A 14 23 Q 15 16 to Yes, And t h a t That i s Mr. A yes? No. is w h e r e I now am. right, yes. Have y o u e v e r w o r k e d f o r Liam M cG o n a g l e ? My r e l a t i o n s h i p w i t h Liam M cG o n ag l e i s 17 sorry, 18 p rofessional b a sis. 19 He h a s b e e n a f r i e n d . 20 s i n c e we w e r e a b o u t t e n y e a r s o f a g e . 21 24 Q 22 A -­ I h a v e w o r k e d f o r h im b u t n e v e r on a My r e l a t i o n s h i p w i t h hi m i s : He was a f r i e n d o f m i n e Y e s? We w e n t t o school together. 23 together, 24 We w e n t t o UCD t o g e t h e r ; 25 do A r t s p r i o r t o g o i n g i n t o 26 25 Q 27 A 28 26 Q Y e s? 29 A Yes. dinghies together, We s a i l e d b o a t s when we w e r e k i d s . h e t o do l a w a n d I t o accountancy. Y e s? We w e r e t h e b e s t of friends all our l i v e s . I was b e s t man a t b o t h h i s w e d d i n g s . 9 His 1 2 27 Q. 3 A. 4 28 Q. 5 A. 6 Y e s? And t h e second - - Y e s? He s t o o d i n f o r my f a t h e r when I was m a r r i e d b e c a u s e my f a t h e r was i l l 7 29 Q. 8 A. 9 30 Q. 10 A. 11 he was m a r r i e d a g a i n . in h o s p ita l. Y e s? So, we w e r e a s c l o s e as t h a t . Y e s? T h e r e was no d a y n o r m a l l y t h a t we d i d n ' t m e e t m a y be . He w o u l d b e c o m i n g home. 12 31 Q. 13 A. 14 I know. So, you were v e r y c l o s e ? May b e g o i n g home i n t h e e v e n i n g f o r a p i n t o r whatever. 15 32 Q. 16 A. 17 33 Q. 18 A. Yes, yes. 19 34 Q. Yes, I understand. 20 A. 21 However, y o u n e v e r w o r k e d f o r hi m a s such? N e v e r w o r k e d f o r hi m b u t h e l p e d hi m o u t . And y o u w o u l d h a v e d o n e p r o f e s s i o n a l t h i n g s f o r him? Yes? Bu t n e v e r on a p r o f e s s i o n a l b a s i s . T h e r e was n e v e r any pay i n v o l v e d . 22 35 Q. 23 A. 24 36 Q. 25 A. 26 37 Q. 27 T h e r e was n o t ? No. I see, I see? No. I see. I note that minor b e n e f i c i a r i e s 28 A. 29 38 Q. That's righ t. Would t h a t b e f a i r ? you, I think, of h is W ill? were one o f t h e 1 2 39 Q. 3 A. 4 4 0 Q. 5 I understand that? Yes. And I p r e s u m e t h a t was a s a r e s u l t o f t h e wo r k t h a t you had done t h r o u g h o u t t h e y e a r s p r o b a b ly ? 6 A. 7 41 Q. 8 A. 9 42 Q. 10 A. Yes. 11 43 Q. Y e s? 12 A. I t was. 14 44 Q. 15 A. 16 45 Q. yes. An a c k n o w l e d g e m e n t o f t h a t ? Yes, yes. And y o u r f r i e n d s h i p I suppose? And t h e r e was a f u r t h e r a c k n o w l e d g m e n t w h i c h we w ill 13 I t was, A ll come t o later. right? As y o u p r o c e e d . Grand, fair enough. That i s very h elp fu l 17 a nd t h a n k y o u v e r y much f o r t h a t . 18 now t o t h e K i n s a l e Y a c h t C h a r t e r s L t d ? 19 A. 20 46 Q. 21 A. indeed G e t t in g back Yes. What k i n d o f a co mpa ny was t h i s ? This i s a l o n g t i m e a g o a nd a s I recollect it 22 o n l y p u r p o s e was t o c h a r t e r a b o a t o n c e f o r a 23 c e r t a i n p e r io d o f tim e th a t 24 t h a t he, 25 of 26 rightly, 27 f u n c t i o n t o be h e l d i n w h a tev er t h e 28 he w a n t e d t o h a v e a b o a t t o a t t e n d a t t h a t 29 a nd he d e c i d e d t h a t w h at h e w o u l d do i s Liam, wanted to use s a i l i n g a s a i l i n g boat around th e I r e l a n d a t t h e t i m e when I t h i n k , I think, it's if coast I recollect t h e r e was a m a j o r y a c h t i n g y e a r was and function he w ould 1 2 3 A. Whi c h h e c h a r t e r e d for I think - - I can 't remember 4 how l o n g . 5 t o my k n o w l e d g e I n e v e r h a d a n y t h i n g more t o do 6 w ith th at except 7 doing i t ; I was D i r e c t o r o f t h e Company. 8 48 Q. 9 A. 10 49 Q. 12 A. 13 50 Q. 14 A. 16 51 Q. 17 A. 18 52 Q. 19 A. 20 53 Q. 21 A. I was h i s Bu t t o my k n o w l e d g e t h a t Yes. It friend; he was Company n e v e r d i d a n y t h i n g sim ply chartered a boat. I t must have been a b i g b o a t ; I t was a b i g b o a t . Because the for that 15 that might have been a year but Y e s? else. 11 I think i t I t was was i t ? 60 f e e t . amount b o r r o w e d f r o m G u i n n e s s & Mahon o p e r a t i o n was £ 4 0 , 0 0 0 ? Yes. T h a t s t r i k e s me a s v e r y b i g now? W ell, h e . . . (INTERJECTION). In 1973 c o n t e x t ? Yes, yes. I t m ight n ot be b i g today? W ell, now I w i l l tell you: My r e c o l l e c t i o n was t h a t 22 he was c h a r t e r i n g 23 y ear or so m eth in g , 24 on b u t i t 25 K i n s a l e Y a c h t C h a r t e r s was t h e o w n er o f t h e b o a t . 26 54 Q. 27 A. 28 55 Q. 29 may b e , it for a r e s t r ic t e d period, because o f t h is I t may b e t h a t Y e s? it f u n c t i o n t h a t was and I do n o t reme mbe r t h i s , Y e s? bought th e b o a t. for a that 1 it 2 56 Q. 3 A. 4 57 Q. 5 A. 6 58 Q. 7 a g a in or so m eth in g . Yes ? I quite know t h a t . Yes ? I n e v e r t h o u g h t o f . . . (INTERJECTION). Yes. I t h i n k y o u w o u l d a g r e e w i t h me Because t h a t £ 4 0 , 000 . . . (INTERJECTION)? 8 A. 9 59 Q. 10 A. 11 Yes . I n 1 9 7 3 . . . (INTERJECTION) ? I t would have been - - it would have b e e n . . . (INTERJECTION). 12 60 Q. 13 A. 14 61 Q. 15 A. 16 62 Q. Yes ? 17 A. Yes . 18 63 Q. 19 A. Yes . 20 64 Q. Y e s? 21 A. 22 Was more t h a n c h a r t e r i n g costs? I t would have been th e v a l u e o f t h e b o a t . I t would be t h e v a lu e o f t h e boat? Yes, yes. That i s So, right? I am n o t certain th e u se t o which i t was p u t I h a d no d a y t o d a y c o n n e c t i o n w i t h t h e b o a t . 23 65 Q 24 A 25 66 Q 26 A Yes . 27 67 Q Yes, 28 A 29 frankly don't Who owned t h e Company? I w o u l d h a v e a s s u m e d Liam M c G o n a g l e . Liam M c G on ag l e? yes, I understand? Or I w o u l d - - that is w o u l d a s s u m e t h a t now. all -- I can't reme mbe r b u t I 1 68 Q. 2 A. 3 69 Q. 4 A. 5 6 Yes. Y e s? Bu t i t w a s . . . (INTERJECTION). Ye? To my k n o w l e d g e , 70 Q. Yes. 8 in terest 9 A. 10 71 Q. 11 or i t never did b e c a m e £ 5 8 , 0 0 0 w i t h r o l l e d up and t h a t so rt o f thing? I see. Do y o u reme mbe r t h e finan cial arrangements in volved in it ? A. No, I don't. I w asn't - - 13 in volved in the 14 recollect 72 Q. 16 fin an cial I don't think arrangem ents. I was I can't b e i n g i n v o l v e d i n them. You s e e u n f o r t u n a t e l y t h a t does not s q u a r e w i t h our evidence? 17 A. 18 73 Q. Yes, right. C ould I f i r s t 19 second. 20 f r o m yo u? 21 A. 22 74 Q. 23 A. 24 75 Q. 25 A. 27 76 Q. 28 A. of a ll, and I w i l l tell I mean we a r e n o t t r y i n g t o y o u why i n a keep a n y t h i n g Yes. We w i l l e x p l a i n th e whole t h in g t o y ou? Yes. K i n s a l e Y a c h t C h a r t e r s L t d b o r r o w e d m one y f r om Guinness 26 29 it I t b o r r o w e d £ 4 0 , 0 0 0 w h i c h u l t i m a t e l y b e c a me £80,000 15 knowledge, anything e l s e . 7 12 certain & Mahon? Yes. Had y o u c o n t a c t s Yes. W ell, in Guinness & Mahon a t t h a t t i m e ? now I ha d c o n t a c t s in Guinness & Mahon 1 2 77 Q 3 A 4 78 Q So , 5 79 Q He h a d c o n t a c t s there? 6 A He h a d c o n t a c t s there, 7 80 Q I see. Y e s? Yes . he . . . ? yes. What y o u a r e c o n v e y i n g t o me, 8 th at the 9 his Mr. Turvey, c o n t a c t s which you t a p p e d i n t o were r e a l l y contacts? 10 A 11 81 Q Is that a fa ir summary o f w h at y o u a r e 12 A It is. absolutely. 13 82 Q 14 A T he y w e r e . Yes, It T he y w e r e , is, I had one c o n n e c t i o n w i t h G u in n e ss not w ith Guinness 16 Guinness 17 G uinness. 83 Q 19 A 20 84 Q 22 A 23 85 Q 25 A 26 86 Q 28 A 29 87 Q John Who h a p p e n e d t o b e a member o f Howth Y a c h t C l u b from. S o, therefore I knew h i m. Y e s? But I d i d n ' t Yes, know him b u s i n e s s w ise. I h a d no c o n n e c t i o n s w i t h him. I see? B u t I knew n o b o d y e l s e p oint 27 & Mahon b u t w i t h a p e r s o n i n Yes ? b usiness 24 saying? & Mahon b u t - ­ & Mahon a nd t h a t was t h e l a t e where I s a i l e d 21 yes. very w ell? 15 18 is in Guinness & Mahon a t t h a t in tim e. And y o u w e r e a member o f Howth Y a c h t C l u b y o u r s e l f ? Yes . 1 2 88 Q. Yes, I see. I wonder i f 3 p a g e 34? 4 (indicating) 5 1) ? 6 A. 7 89 Q. 8 A. 9 90 Q. 10 y o u w o u l d s ho w Mr. Turvey We h a v e a number o f d o c u m e n t s h e r e an d I w i l l sh o w t he m t o you (Exhibit Yes. Some o f t h e m a r e n o t r e a l l y relevant at a ll? Yes. I am o n l y p i c k i n g out th e ones r e a l l y th a t are o f any r e l e v a n c e t o your g o o d s e l f ? 11 A. 12 91 Q. R ight, yes. However, just to set the background t h i s 13 n o t h i n g t o do w i t h y o u e i t h e r b u t j u s t 14 background: 15 Ltd; 16 t o do i s 17 A. 18 92 Q. 19 A. 20 93 Q. This i s 22 1) ? 24 94 Q. the o t h e r na me s? yes. a list (E xhibit 1)? Yes. is A. set What we a r e g o i n g we a r e g o i n g t o e x c l u d e t h e Because t h i s 21 23 to probably I f you s e e K i n s a l e Yacht Club C h a r t e r s K i n s a l e Yacht C h a r t e r s Ltd? I see, is a list relevant t o many p e o p l e o n l y o n e e n t r y on t h e l i s t and t h i s (Same Handed) (E xhibit R ight. We w i l l give you a p h o t o s t a t 25 require it. There i s 26 A ll 27 is 28 a nd i t 29 K i n s a l e Yacht C h a r t e r s Ltd, righ t. a list of it no d i f f i c u l t y I f you w ould j u s t (Exhibit 1) shows v a r i o u s later if w ith th a t. look at that? produced by G uinness com panies, you T h at & Mahon one o f w hich i s and t h e amount o f mone y 1 w h i c h t h e y owed a t t h e v a r i o u s 2 repayment d a t e 3 was t h e 4 says : 5 dates. You s e e t h e i n th e c a s e o f K in s a le Yacht C h a rters 1 6 t h O c t o b e r 1 9 95 a n d y o u s e e b e y o n d t h a t "Suitably secured. i n t e r e s t "? it E x c e s s due t o 6 7 Do y o u s e e t h a t ? 8 A 9 95 Q I see th at, yes. The n o r m a l m e a n i n g o f s u i t a b l y s e c u r e d we h a v e b e e n 10 t o l d by G uinness 11 was s e c u r e d w i t h m one y on d e p o s i t 12 A 13 96 Q 14 A 15 97 Q & Mahon i s that it meant t h a t elsew here? Yes . Normally o u t s i d e the ju r is d ic tio n ? Yes . B a s i c a l l y th e y were, s o f a r a s we c a n a s c e r t a i n , 16 three p o s s i b i l i t i e s . 17 w h i c h was a v e r y u n u s u a l s i t u a t i o n b u t i t 18 on o n e o r t wo o c c a s i o n s ? 19 A 20 98 Q 21 A 23 99 Q 24 A 26 1 00 Q 27 Ireland d i d happen T h e r e was London w h i c h was v e r y u n u s u a l b u t t h e r e Islands a n d t h e r e was Cayman? Yes . It is t h e Cayman c o n n e c t i o n w h i c h we a r e i n t e r e s t e d in r e a lly . 25 T h e r e was t h e N o r t h o f Yes . was t h e C h a n n e l 22 it We a r e n o t i n t e r e s t e d in the rest? Yes . D i d y o u know a n y t h i n g a b o u t t h a t loan b eing s u it a b ly secured? 28 A 29 1 01 Q I d i d n ' t but Y e s? I d i d know a b o u t a T r u s t i n t h e Cayman. 1 And I knew t h a t 2 f o r Liam M cG o n a g l e a t t h e t i m e . 3 102 Q 4 A 5 1 03 Q 6 A 7 104 Q 9 A was o r g a n i s e d b y G u i n n e s s & Mahon Yes ? I was a w a r e t h a t it was t h e r e . Yes ? I had f o r g o t t e n Guinness 8 it Yes, t h a t h e h a d e v e r b o r r o w e d f r om & Mahon. I ha d f o r g o t t e n t h a t . I understand? And t h e r e was o n l y o n e b o r r o w i n g I c o u l d e v e r 10 reme mbe r w h i c h was a b o r r o w i n g when h e b o r r o w e d 11 a bridging 12 stage. 13 1 05 Q 14 A Y e s? And t h a t was - - 16 106 Q 17 A 18 107 Q Yes, 19 A Yes . 20 108 Q 21 A 22 109 Q 23 I reme mbe r was s e c u r e d The name o f t h a t Was B r i t i s h T r u s t i n t h e Cayman I s l a n d s ? Isles Investm ents. we a r e a w a r e o f t h a t That i s grand? Yes . That i s grand. It is one o f t h e t h i n g s be a s k i n g you ab ou t l a t e r . A Trust? Now, That i s I w ill grand? I am. 25 MR. 26 JUDGE O'LEARY: Yes. 27 MR. What i s DALY: DALY: 28 29 some b y . . . (INTERJECTION). 15 24 l o a n when he b o u g h t a h o u s e a t so as I can w r i t e Judge O 'Leary? th is document (in dicating) (E xhibit down i n my n o t e s w h a t i t is? 1) 1 2 is 3 Guinness 4 who h a d l o a n s 5 tim e but b a s i c a l l y 6 at a p a r tic u la r 7 case 8 su itab ly 9 MR. DALY: 10 A. a list & Mahon o f t h e p e r s o n s t h a t were £ 1 0 , 0 0 0 it shows t h e and c o m p a n i e s a nd o v e r a t t h e status t i m e and y o u w i l l o f K i n s a l e Yacht C h a r t e r s secured; do it of the see that loans in the shows t h a t it is >u u n d e r s t a n d t h a t ? Yes, I do. Yes. 11 JUDGE O'LEARY: Yes . 12 MR. DALY: However, 13 not a l l 14 m i g h t h a v e ha d on t h a t p a r t i c u l a r 15 JUDGE O'LEARY: No, 16 MR. DALY: It 17 18 p r o d u c e d by su rely th is the loans is they day? no. is se le c te d portion. JUDGE O'LEARY: 19 We h a v e e x c l u d e d t h e r e s t of the loan s. 20 MR. DALY: Yes . 21 JUDGE O'LEARY: We h a v e e x c l u d e d t h e r e s t 22 of the loans because they 23 ar e n o t o f any i n t e r e s t 24 MR. DALY: 25 26 to your c l i e n t . So, t h e s e . . . (INTERJECTION). JUDGE O'LEARY: 27 This is the o n l y o n e y ou are in t e r e s t e d 28 K i n s a l e Yacht C h a r t e r s . 29 MR. DALY: in, 1 2 3 MR. DALY: Yes . 4 MS. MACKEY: This 5 is just an e x t r a c t from a l o n g l i s t . 6 JUDGE O'LEARY: From a l o n g l i s t . 7 MR. DALY: Okay. 8 MS. MACKEY: A page o f th e JUDGE O'LEARY: I mean t h e r e m i g h t b e many 9 1 10 Q 10 pages but th ey are nothing 11 t o do w i t h y o u ? 12 A 13 1 11 Q 14 15 list. Yes, yes. Why s h o u l d we b e b u r d e n i n g y o u w i t h t h e names o f p e o p l e who h a v e n o t h i n g w h a t s o e v e r t o do w i t h y o u ? A R ight. I was a w a r e o f t h i s 16 I first got 17 a ffa irs. 18 112 Q 19 A 20 Trust i n v o l v e d w i t h Liam M cG o n ag l e i n h i s Yes ? And I w o u l d r e g a r d m y s e l f a s p r o b a b l y t h e p e r s o n t h a t he e v e r r e v e a l e d i t 21 1 13 Q 22 A 24 w ife . 26 A 27 1 15 Q to. I know t h a t h e n e v e r m e n t i o n e d i t a nd I know t h a t 114 Q only Y e s? 23 25 f r o m 1 9 7 2 when to his he n e v e r m e n t i o n e d i t first to his w ife second Yes ? But he d i d t e l l me f r om d a y o n e t h a t he h a d i t . Yes, That i s yes, yes. very h e lp fu l. 28 v e r y much i n d e e d . 29 I have w i t h K i n s a l e Yacht C h a r t e r s The l i t t l e b it Thank y o u o f problem th a t is d isclosed 1 in page 35. 2 w ith i t 3 Thank y o u . 4 116 Q It is R eally i t (Same Handed) t o do w i t h t h e 5 i n t e r n a l Guinness 6 shows t h e i r 7 slig h tly 8 t o d a y o v e r d r a f t now. 9 A 10 117 Q is th e o n ly problem I have (Exhibit fact that 2)? -- th is is an & Mahon d o c u m e n t a g a i n a nd t h i s a p p r o v a l o f an o v e r d r a f t . different overdraft. It is a T h i s was a d a y I t was n o t t h e £ 5 8 , 0 0 0 ? Yes . You s e e t h a t the s e c u r i t y w h i c h was g i v e n i n r e s p e c t 11 of that 12 g u a r a n t e e b y Liam M c Go n a g l e an d Des T u r v e y b u t 13 Liam M c G o n a g l e ' s name was i n 14 A 15 118 Q 16 a c c o r d i n g t o t h e m was a j o i n t For an o v e r d r a f t o f £3,000? Yes. y o u show Mr. In f a c t (Exhibit 3), 17 w ill 18 was o f f e r e d 19 A 20 119 Q 21 A if which r e a l l y however s e e t h a t I h a v e no r e c o l l e c t i o n 23 of £3,000. 25 A 26 27 28 29 I just letter you that s p e c i f i c a l l y mentioned? of it at a l l . why h e w o u l d n e e d a f a c i l i t y don't understand i t . I mean h e was a p e r s o n who a l w a y s h a d s u f f i c i e n t Yes. f o r w h a t e v e r he w anted t o do. T h e r e may b e a b o o k k e e p i n g o r t a x o r o t h e r r e a s o n why he n e e d e d i t ? A fa cility it, Yes ? m on e y o r f u n d s 1 21 Q 36 & 37 None w h a t e v e r a nd I c a n ' t u n d e r s t a n d o r b e l i e v e t h a t he w o u l d h a v e - - 1 20 Q Turvey pages You h a v e no r e c o l l e c t i o n ? 22 24 f a c t taken out o f i t ? do n o t a d d much t o in the y o u r name i s a nd s e v e r a l 1 122 Q 2 A 3 don't recollect 1 23 Q 5 A 6 124 Q 7 A 9 1 25 Q 10 A 11 126 Q 12 A 13 127 Q 14 A 15 128 Q 16 A 17 129 Q 18 A 19 You c a n n o t e x p l a i n I can 't Yes. see. Had y ou a n y i n t e r e s t 1 30 Q No, except that I sailed i n K in s a le Yacht C h a rters Yes, yes. However, No, no, it was n o t y o u r o p e r a t i o n ? not at a l l , You s a i l i n g Yes . You p a r t i c i p a t e d t h a t way? Yes . I understand. Y e s? B e c a u s e we s a i l e d together less, yo u know? Yes. Would yo u b e l i e v e the 24 26 Mr. it for By me, yes. Yes. It O bviously, (in d icatin g), does fifty Turvey, A 28 132 Q Yes, (Exhibit Sorry? you l o o k 4)? I must have from l o o k i n g (Exhibit 4 )yes. seem r a t h e r s t r a n g e a nd I j u s t if we a c t u a l l y h a v e for £3,000 right? 27 y e a r s more o r actu ally -- g u a r a n t e e e x e c u t e d by you at th is 1 31 Q no. on t h e b o a t ? 22 A on t h e b o a t . I understand that? a t p a g e 40 o n w a r d s , 29 explain it? 21 25 and I c a n ' t yourself? 8 23 it i t . 4 20 I certain ly d on 't understand i t . all 1 2 1 33 Q. JUDGE O'LEARY: I t was e x t e n d e d f r o m y e a r 3 4 to year. A. 5 that 134 Q. 7 A. 8 1 35 Q. 9 No, no. No - - A. I think i t I think i t Yes, 1976. I thought i t I was g o i n g t o 1976, is say th at was 1 9 7 1 f o r it c o u ld n 't be. 1976? yes. is I see w r i t t e n up a t p a g e 40 a t t h e t o p o f i t (Exhibit 4)? 1 9 7 6 up t h e r e b u t I had l o o k e d a t t h e bottom . 12 1 3 6 Q. 13 A. 14 137 Q. 15 A. 16 138 Q. 17 A. 18 1 3 9 Q. 19 A. 20 1 40 Q. 21 A. It is, 22 1 41 Q. It is 23 A. 24 142 Q. 25 Y e s? A b o u t my s i g n a t u r e . I know. 1971, A. 27 1 43 Q. It think i t is just a b a d "1"? yes. A b a d "6" I s h o u l d s a y ? Yes. It looks Bu t i t lik e is a "1"? your s ig n a t u r e . I mean t h a t yes. is It your s ig n a t u r e ; is, is it? yes. yo u? Yes, yes. A ll righ t. side 26 29 yes, (indicating) 11 28 -- a m inute. 6 10 Is Yes? I t h i n k we w i l l f o r t h e moment , Mr. just leave t h a t t o one Turvey? R ight. It is n o t m a t t e r w h i c h e x c i t e s me h u g e l y i n t h a t regard? 1 144 Q 2 A 3 1 45 Q Yes, 4 A Yes . 5 146 Q Yes, But I m i g h t add t h a t I understand. it Now I j u s t 6 things 7 t o which I would l i k e 8 to 9 A 10 147 Q 11 A 12 148 Q 13 A is y o u know? Yes? I understand. to get m y s t i f i e s me, o u t o f t h e w ay . h a v e o n e o r t wo The s e c o n d t h i n g to d ir e c t your a t t e n t i o n a co mpa ny c a l l e d a C a m i l l e I n v e s t m e n t s ? Yes . A re y o u f a m i l i a r w i t h t h a t I am, company? yes. What was t h a t company? T h a t co mpa ny was an i n v e s t m e n t co mpany t h a t Liam 14 used to 15 have had f a c i l i t i e s 16 bought sto c k s 17 who w e r e D u d g e o n s , 18 as 19 way i t 20 i n M o l e s w o r t h S t r e e t when h e w o r k e d t h e r e . 21 149 Q 22 A -- that p o ssib ly I recollect 25 for 28 29 it and he a l s o of his He stock brokers, used i t was t h e o w n e r , T h a t co mpa ny p r e s e n t e d i t s was on r e c o r d . A & Mahon. -- as far I t h i n k any office prem ises I see? 24 27 from G u in n e ss was t h e o w n e r , th e Revenue, 1 50 Q a c a s e w h e r e h e may a nd s h a r e s t h r o u g h h i s 23 26 is it. accounts the tax people, every year to a nd d i d a c c o u n t s and E v e r y t h i n g s h o u l d be a v a i l a b l e Yes. I think u ltim a te ly I t was d i s s o l v e d , it yes. was d i s s o l v e d ; I t went i n t o is that so? liq u id ation l o n g t i m e a g o now. 1 51 Q Can we t a k e it th a t C am ille Investm ents Lim ited a 1 2 Yes, 3 152 Q 4 A absolutely. Did you have any i n t e r e s t No, it? b u t I d i d h e l p hi m w i t h i t 5 lia ise 6 who w e r e D u d g e o n s , 7 Guinness & Mahon b e c a u s e 8 rightly, it's 9 stocks 10 in b e t w e e n h i m a nd t h e and I d i d stockbrokers, a n d b e t w e e n hi m and I think, common w i t h l o t s if I recollect of other people; and s h a r e s w h e r e r e g i s t e r e d its i n t h e name o f Mars N o m i n e e s . 11 1 53 Q 12 A Yes ? Who w e r e a G u i n n e s s 13 for th a t purpose; 14 clien ts. 15 154 Q Y e s? 16 A And? 17 1 55 Q 18 A 19 156 Q 20 A 21 & Mahon n o m i n e e c omp a ny f o r m e d to hold sto ck s and s h a r e s N o t i n t h e name o f C a m i l l e Investm ents? I think th at was d o n e , is t h e way i t for yes. Y e s? And i t was d o n e . I t was common p r a c t i c e at the tim e . 22 157 Q 23 A Y e s? I don't think i t was d o n e f o r a n y r e a s o n o f h i d i n g 24 anything because it 25 y o u know? 26 158 Q 27 28 29 O rganisation, yes. was a t o t a l l y How w o u l d y o u d e s c r i b e r e l a t i o n s h i p w ith Cam ille A W ell, m erely th a t c o n s u l t e d me. up f r o n t co mp a ny , your Investm ents? I was a f r i e n d o f L i a m ' s . We u s e d t o t a l k He about buying s to c k s 1 a nd s h a r e s 2 should s e l l 3 159 Q 4 A 5 1 60 Q 7 A 8 And a l s o 1 61 Q 10 A I was t h e n w o r k i n g i n Our o f f i c e s F i n n e g a n Me nt on f r om w e r e i n M e r r i o n Row. Y e s? Liam's offices Guinness 9 a nd how he s h o u l d h o l d t h e m e t c . Yes ? 1972. 6 and w h a t he s h o u l d b u y a n d w h a t he were i n M olesw orth S t r e e t & Mahon was i n Dame S t r e e t . Yes ? And I was v e r y much a r u n n e r . We, F i n n e g a n Menton, 11 h a d some b a n k a c c o u n t s w i t h G u i n n e s s 12 had r e a s o n t o 13 regular b a s is . 14 do t h e d o n k e y w o r k , 15 Guinness 16 162 Q 17 Yes. lia ise So, w ith Guinness & Mahon. I & Mahon on a Liam u s e d me a s a p e r s o n t o if you l i k e , b e t w e e n hi m and & Mahon on b e h a l f o f C a m i l l e Do y o u m i n d me a s k i n g : Investm ents. Were y o u p a i d f o r that? 18 A 19 1 63 Q 20 A 21 164 Q 22 No, no. You w e r e n o t p a i d No, no, for that? no. Would y o u b e s u r p r i s e d t h a t Dudgeons, or w h atever or however t h e y pronounce i t ? 23 A 24 1 65 Q 25 Yes . That t h e y d e s c r i b e d you a s t h e C h i e f E x e c u t i v e o f C am ille 26 A 27 166 Q 28 29 and Investm ents? I would be v e r y s u r p r i s e d . You m i g h t s how Mr. T u r v e y p a g e 72 (Same Handed) (E x h ib it 5)? A Thank y o u . It is the 26 first tim e I have been 1 2 167 Q 3 4 Mr. Turvey, with friends lik e enem ies ? A Yes. Some bo dy u s e d t h e i r im agination because there 5 was no s u c h t h i n g 6 it, 7 was s i m p l y Liam M c G o n a g l e , 8 168 Q 9 A 10 169 Q 11 12 t h a t who n e e d s A d id n 't as a C h ie f E x e c u t iv e . have any e m p l o y e e s . C am ille I understand? So? I t was a v e h i c l e w h ic h he u s e d and t h e r e f o r e existed in h is Yes, was an i n v e s t m e n t it head; is that a fair 14 p ortfolio 15 in a lim ited 17 A 18 summary? of investm ents; you had a i n h a v i n g them compa ny r a t h e r t h a n i n y o u r name. Yes ? I don't know b u t I i m a g i n e t h a t was p a r t o f t h e th in k in g. 19 1 71 Q 20 A 21 22 it co mpa ny a nd t h e r e p r o b a b l y w ere t a x a d v a n t a g e s a t t h e tim e i f 1 70 Q Investm ents y o u know? 13 16 Cam ille, Yes, yes? But t o d e s c r i b e Cam ille a C hief E xecutive 172 Q Yes, yes. is I see. I n v e s t m e n t a s h a v i n g h ad nonsense r e a lly , Do y o u s e e if y o u know? y o u w o u l d show t h e 23 C h i e f E x e c u t i v e t h e r e o f C a m i l l e I n v e s t m e n t s p a g e 79 24 (Same Handed) 25 A 26 1 73 Q 27 A 29 174 Q 6)? Thanks. You w i l l C am ille 28 (Exhibit s e e where our i n t e r e s t Investm ents, Mr. our i n t e r e s t in i t c o m es i n i n Turvey? R ight. This i s 27 really. I mean we 1 are not a b i t in terested 2 their affairs except 3 work? 4 Yes. I think I remember t h i s 5 th is 6 sure th a t 7 1 75 Q 8 A 9 i n how p e o p l e i n s o f a r as i t on b e h a l f o f L iam. it all organise i m p i n g e s on o u r righ t an d I d i d I t h i n k now b u t I am n o t was a b r i d g i n g l o a n t h a t he n e e d e d . Y e s? I can 't s e e t h e d a t e on i t but even then I w ouldn't reme mbe r t h e d a t e . 10 176 Q Yes. 11 A Yes . 12 177 Q 13 A If I think i t is the 16th August you l o o k a t t h e b o tto m I see it, yes, yes. (in dicating) I think i t 14 he n e e d e d when h e was s e l l i n g 15 H illtop 16 i n Howth c a l l e d 17 178 Q 18 A 19 179 Q 21 A 22 1 80 Q (E xhibit was a b r i d g i n g his 6)? loan house c a l l e d i n Howth a nd was p u r c h a s i n g a new h o u s e The T a n s e y . Yes ? And i n t h e i n t e r i m b e t w e e n t h e p u r c h a s e and t h e he n e e d e d b r i d g i n g 20 1978? sale finance. Y e s? And I t h i n k . . . However, as you w i l l a p p r e c i a t e w h a t we a r e 23 in terested 24 n o t c a r e w h at h e was d o i n g w i t h h i s m one y r e a l l y : 25 "GMCT"? 26 A 27 1 81 Q 28 A 29 182 Q in i s the la s t portion of i t . GMCT was G u i n n e s s . . . Is G u i n n e s s Mahon Cayman T r u s t ? G u i n n e s s Mahon Cayman T r u s t , Exactly? yes. I do 1 2 1 83 Q 3 A Yes. So, it's -- I would t h i n k t h a t ' s 4 m on e y t h a t h e h a d i n t h a t 5 Lim ited, 6 some k i n d o f s u p p o r t o r s e c u r i t y 7 (in d icatin g). 8 184 Q 9 t h a t became a T r u s t , that Isles Investm ents was b e i n g u s e d a s Can we b e r e a s o n a b l y s u r e t h a t Investm ents; 10 B ritish sim ply th a t it for th is loan was B r i t i s h Isles t h e r e was n o t a s e c o n d T r u s t co mp a ny t h e r e ? 11 A 12 1 85 Q 13 A N o t t o my k n o w l e d g e . Not t o your knowledge? N o t t o my k n o w l e d g e , no. Now, it might have been 14 called 15 I n v e s t m e n t s L i m i t e d and I t h i n k t h a t was a company 16 beneath the Trust. 17 186 Q 18 A 19 187 Q 20 A 21 188 Q 22 A Whic h was B r i t i s h Yes, But t h e d i s t i n c t i o n 25 shares 28 1 90 Q 29 A Investment Trust. Yes? I do? the A Isles You know? 24 27 Isles I understand. B ritish 189 Q t h e r e was a co mpany c a l l e d B r i t i s h Yes ? 23 26 -- Isles b e t w e e n t h e two? I think I n v e s t m e n t s L i m i t e d was p r o b a b l y co mpa ny t h a t h e l d w h a t e v e r i n s t o c k s and and c a s h t h a t was t h e r e . Y e s? And t h e t r u s t was a b o v e t h e Company i n Is still that tru st there; some wa y . do y o u t h i n k ? 1 1 91 Q 2 A No? It is not th e r e , b e c a u s e when t h a t changed to 3 "Ansbacher" it v e r y q u i c k l y c h a n g e d t h e n f r om 4 "Ansbacher" -- t h e man who r a n t h a t was a man c a l l e d 5 John F u rze, a s y o u p r o b a b l y know. 6 192 Q 7 A Yes. Yes ? And he b r o k e o f f f r om " A n s b a c h e r " a n d f o r m e d some 8 new co mpa ny o f h i s 9 want t o be c o n n e c t e d w i t h and he s h i f t e d t h e T r u s t 10 Liam M c G on a g l e d i d n ' t t h e n f r o m Cayman t o G u e r n s e y . 11 1 93 Q 12 A 13 Yes ? To a co mpa ny w h i c h h a d b e e n a G u i n n e s s & Mahon c omp a ny i n G u e r n s e y o r maybe was t h e n . 14 194 Q 15 A 16 What was t h e name o f t h a t company? I t was G u i n n e s s Mahon G u e r n s e y T r u s t o r J e r s e y T r u s t or som ething. 17 1 95 Q 18 A 19 20 own t h a t Yes ? I t was t h e p e o p l e a nd t h e y l a t e r b e c a m e C r e d i t S u isse. 196 Q 21 Yes. Do y o u reme mbe r t h e o p e r a t i n g arm o f t h a t c ompany? 22 A 23 197 Q 24 A 25 198 Q 26 A 27 199 Q 29 A I g a v e y o u a name? T h e r e w e r e a number o f c o m p a n i e s . If I g a v e y o u t h e name C o l l e g e T r u s t e e s ? Yes . Would i t Yes, mean a n y t h i n g t o y o u ? that called 28 If rings a b ell S o v e r e i g n Management a s w e l l . S o v e r e i g n M a na g e m e n t . I don't a nd t h e r e was s o m e t h i n g know w h a t t h e 30 Yes? in terrelation sh ip between 1 2 200 Q Yes. 3 A Yes . 4 201 Q 5 A 6 202 Q However, I see. As f a r a s y o u a r e c o n c e r n e d i t 8 know? 10 203 Q 11 A 12 Yes, to? Yes, could s t i l l As f a r a s y o u a r e c o n c e r n e d y o u do n o t yes. You do n o t know? I assume i t is. In f a c t I know i t is still th ere. 13 204 Q Yes, 14 A Yes . 15 205 Q yes? F air enough. However, 16 business. 17 have any i n t e r e s t 18 A 19 206 Q 20 A 21 207 Q 22 23 where he t r a n s f e r r e d i t Yes . be t h e r e . A is I see? 7 9 that No. that is r e a l l y none o f our We a r e n o t i n t e r e s t e d in C am ille You mean a f i n a n c i a l in th a t. Did you In vestm en ts Lim ited? in terest? Y e s? No. Yes. However, you seem t o have done q u i t e an amount o f wo rk f o r i t ? A 24 I did. I used to keep r e c o r d s f o r hi m a s b e s t could. 25 208 Q 26 A Yes ? Records o f s t o c k s and s h a r e s a nd t h e i r current 27 valuations; 28 n e w s p a p e r s o c c a s i o n a l l y when h e w a n t e d t o 29 know w h at t h e y w e r e w o r t h . update the v a lu a t io n s from t h e I 1 2 0 9 Q. 2 A. 3 2 1 0 Q. 4 5 Y e s? And d i d some b a s i c b o o k - k e e p i n g a s w e l l . Do y o u reme mbe r how many l o a n s he g o t t h e Company? A. 6 I would have th o u g h t v e r y few. t h a t was m e n t i o n e d t h e r e 7 2 1 1 Q. 8 A. 9 212 Q. 10 A. 11 2 1 3 Q. Y e s? 12 A. Yes. I had f o r g o t t e n Yes, I am j u s t (in dicating) thing (E xhibit 2). t h a t now? d e a l i n g now w i t h C a m i l l e With C a m i l l e - - I can't 14 the 15 tim e 16 s t a n d i n g on i t s 17 a nd I d o n ' t 18 Investm ents but in itia l yes, sorry, remember b u t needed loans Investm ents? I was t h i n k i n g - - yes. I do t h i n k he may h a v e in th e e a r l y days in order t o purchase p ortfolio o f in v estm en ts but a f t e r I seem t o r e c o l l e c t that own t wo f e e t some t h e Company was w ith ou t borrowings r e c o l l e c t b o rro w in g s by C a m ille 19 214 Q. 20 A. 21 2 1 5 Q. Yes, I see? 22 A. Its, C am ille I c o u l d n ' t be t o o sure. Y e s? I mean - ­ Investm ents, 23 somewhere, 24 t h e r e was a n y . 2 1 6 Q. That £ 3 , 0 0 0 yes. 13 25 f r om Yes, yes. accounts, w hich must be w o u l d sh o w t h e b o r r o w i n g s i t u a t i o n However, if a c c o r d i n g t o our r e c o r d s C a m i l l e 26 I n v e s t m e n t s L i m i t e d ha d a b o u t £ 1 0 0 , 0 0 0 b o r r o w i n g f o r 27 a number o f y e a r s ; 28 It 29 had a f a c i l i t y not ju s t on a s h o r t - t e r m b a s i s . for £100,000 a n y way? 1 217 Q 2 A 3 218 Q 4 Would i t If A 6 219 Q 7 A 8 220 Q 9 A 10 221 Q 12 A 83 & 84 That i s (Same Handed) And p a g e That i s 94 that And p a g e Yes. (Same Handed) just (Exhibit those 15 fa cility 16 overdraw, (Exhibit a standard l e t t e r y o u show him 7)? 94 i s don't ever - it I would f e e l it a l l o w i n g him t o o v e r d r a w , if it fa cility is 19 balance o f £30,000 223 Q In 1983. 22 A 23 224 Q 24 A Sorry, It is £100,000 but in No, I have been a o r t h e Company t o it (E xhibit is page 96 96 s h o w s i s that 9)? (Exhibit 9)? 1983? Yes . " O v erd ra ft.. .balance". 26 I see 27 overdraft. 28 a resu lt 29 I n v e s t m e n t s d i d was: there, So, of -- yes. it W ell, h e p r o b a b l y h a d an may h a v e h a d an o v e r d r a f t a s one o t h e r t h i n g t h a t C a m i l l e It the f a c t h e h a d an o v e r d r a w n yes. it 8)? ha d t o . 18 21 used. could e a s i l y 96 b e c a u s e w h a t p a g e In 1996? was i t (E xhibit was g o i n g on f o r a l l And p a g e A covering th in gs a 1 9 8 3 . . . ( INTERJECTION) know b u t i f years 20 8)? obviously. I w o n d e r was i t 14 25 if Yes . just 222 Q Turvey page, a 1979 s i t u a t i o n ? 13 17 th a t £120,000? Thank y o u . lik e 11 or a f t e r y o u w o u l d s ho w Mr. page, 5 have b e f o r e l e n t m o ne y t o p r o p e r t y 1 companies t h a t 2 in terest 3 225 Q 4 A Liam M c Go n a g l e was — h a d an in. Yes ? I had f o r g o t t e n t h a t now. 5 in terest 6 several prop erties 7 th e borrowings 8 rental 9 226 Q 10 A rates During t h e p e r i o d t h a t w e r e v e r y h i g h a n d h e was i n v o l v e d i n where t h e in terest for these p ro p erties payable exceeded the income i n t h e e a r l y d a y s . Yes ? U ntil r e n t r e v i e w s b r o u g h t t h e r e n t h i g h e r and 11 t h e p r o p e r t y com panies th e n were a b l e t o 12 the 13 227 Q 14 A 15 228 Q 16 A 17 229 Q 19 A 20 cover i n t e r e s t payments. Y e s? And r e p a y t h e loans even tu ally. Have y o u t h e name s o f t h o s e Yes, Ceros 18 they are the com panies, Mr. 230 Q 22 A 23 231 Q 24 A 25 232 Q 26 A 27 Investm ents Lim ited. Yes ? And o n e was L i s l e I n v e s t m e n t Company L i m i t e d ; Y e s? One was G r a f t o n E n g i n e e r i n g L i m i t e d . Yes ? Each o f them had a b u i l d i n g . Yes ? L isle I n v e s t m e n t Company was a b u i l d i n g i n M olesworth S t r e e t . 28 233 Q 29 A Turvey? c o m p a n i e s w i t h i n a Group c a l l e d L -i-s-l-e. 21 for Y e s? G r a f t o n E n g i n e e r i n g L i m i t e d was a b u i l d i n g 34 1 2 234 Q 3 A 4 Yes ? D u b l i n Shop I n v e s t m e n t s L i m i t e d was a b u i l d i n g i n North Earl S t r e e t . 5 235 Q 6 A Yes ? And t h e y a l l were p r o p e r t i e s 7 friends 8 them, 9 tenants f o r them; 10 review s increased; 11 236 Q 12 13 t h a t he a nd t w o o t h e r o f h i s p u r c h a s e d an d r e v a m p e d o r r e f u r b i s h e d or w h a t e v e r you c a l l let it, to the a sse t some e x t e n t ; improve as r e n t and t h e n s o l d t h e m o f f . What a b o u t t h e name, "Pine S e c u r i t i e s " ? Does t h a t mean a n y t h i n g t o y ou? A 14 It does but i t h a s no c o n n e c t i o n w h a t e v e r w i t h Liam M c G o n a g l e . 15 237 Q 16 A Had i t not? Pine S e c u r i t i e s L i m i t e d was a co mpa ny owne d b y 17 J o h n F i n n e g a n o f F i n n e g a n M ent on a nd i t 18 v e r s io n o f C am ille 19 investm ent 20 p r o p e r t y companies in ord er t o en a b le 21 back i n t e r e s t . 22 got 238 Q co mpa ny w h i c h a l s o I w o n d e r w o u l d y o u show Mr. 23 (Same Handed) 24 (in d icatin g). 25 A 26 239 Q 27 R ight, A 29 240 Q (Exhibit l e n t m o ne y t o t h e s e it t o pay Turvey page 87, please You c a n k e e p t h o s e You c a n k e e p them? You c a n k e e p t h o s e . R ight. 10)? I t was an right. y o u g o away? 28 Investm ents Lim ited. was h i s We w i l l p h o t o s t a t t h e m b e f o r e 1 Do y o u s e e t h a t 2 Yes, 3 t h a t would p r o b a b l y be where i n t e r e s t 4 two - - 5 r eme mbe r t h e in c id e n t but 6 som ething - - a c a s e w h e r e an i n v e s t m e n t was 7 p u r c h a s e d o f some k i n d w h i c h - - 8 Liam M c Go na g le a nd Jo hn F i n n e g a n an d p o s s i b l y a 9 th ird party, t h e r e now (in dicating) t h a t w o u ld p r o b a b l y be and t h i s l e t me t h i n k ? No. (E xhibit happened - ­ was du e on I would t h i n k - I would t h in k i t Ken 0 ' R e i l l y - H y l a n d , 11 from t h e o t h e r p a r t i e s . 13 Yes. that 14 A 15 242 Q 16 A So, t h e r e was a c o n n e c t i o n t o t h e t h e y were i n v o l v e d i n In f a c t in itia lly affairs 19 somewhere I t h i n k about A enterp rises? when t h e T r u s t was s e t 18 21 extent Y e s? before 243 Q join t back T he y w e r e . 17 20 was and C a m i l l e p a i d o u t w h a t e v e r t h e c o s t was a n d g o t i t 241 Q I don't between e i t h e r 10 12 10)? up t h i s was I was i n v o l v e d now w i t h hi m i n b u s i n e s s b u t when t h e T r u s t was s e t up i t was 1970 or 1 971 . Y e s? Liam M c Go na g le a nd Ken 0 ' R e i l l y - H y l a n d h a d d e v e l o p e d 22 a p r o p e r t y on M a r l b o r o u g h S t r e e t b e t w e e n t h e m t h e y 23 had d e v e l o p e d t h e p r o p e r t y . 24 Government, 25 think, 26 i n v e s t m e n t a n d t h e y made a l o t 27 t h e t wo o f t h e m , 28 a nd L i a m ' s 29 s o m e t h i n g t h o u s a n d p o u n d s a nd t h a t the They g o t a t e n a n t , Department o f P o st & T elegraphs the I and t h e y s o l d t h e p r o p e r t y on a s an t h e r e was j u s t share o f i t o f m on e y b e t w e e n t h e two t h e r e t h e n , was f o u r h u n d r e d and is t h e money 1 2 244 Q 3 A Yes, I see? And i t went t h e r e la r g e ly because 4 Ken 0 ' R e i l l y - H y l a n d , 5 had f o r 6 he h a d p e r s u a d e d Liam t h a t 7 idea 8 Ken 0 ' R e i l l y - H y l a n d h a d p u t t h e m on e y o u t t h e r e 9 b ecause Lloyds who was w i t h hi m i n t h a t , some t i m e b e e n a member o f L l o y d s it w ould be a good f o r Liam t o b e c o m e a member o f L l o y d s -- a s y o u know t h e r e is 10 t o your l i a b i l i t y 11 m on e y L l o y d s 12 t h e y ca n t a k e y o u r h o u s e and e v e r y t h i n g 13 b ecau se your l i a b i l i t y 14 245 Q 15 A in Lloyds. come t o y ou i f is So, if totally So, w h a t Ken 0 ' R e i l l y - H y l a n d h a d d o n e , a f o r e i g n T r u st where i t 18 to u c h e d by an d t h a t was a t a t i m e , 19 happened a t a tim e, 20 was no C a p i t a l G a i n s T a x . 21 made on t h a t v e n t u r e was n o t t a x a b l e 22 t i m e when we w e r e s t i l l 23 t h e r e was no b r e a c h o f e x c h a n g e c o n t r o l 24 I t was p e r f e c t l y 27 28 29 f r o m y ou Y e s? m on e y i n t o A doing, a n d had was t o p u t t h e c o u l d n ' t be th is all b e f o r e C a p i t a l G a in s Tax. So, in the legitim ate that the p r o fit a nd i t Sterlin g t o do t h a t is the Yes. We a r e n o t regulations. at the tim e. s o u r c e o f t h e m o ne y t h a t in vestigatin g p e o p l e ' s m o ne y a t a l l ? the they was a t a Yes ? And t h a t There area so is there. 247 Q lose unlim ited. 17 26 no l i m i t y o u a r e a member and t a l k e d Liam M c Go na g le i n t o 246 Q and Lloyds 16 25 and source of out 1 2 248 Q 3 A 4 249 Q 5 A Yes. We a r e j u s t . But t h a t I think. We a r e a c c e p t i n g That - - it I diverted was t h e r e onto th a t if it was t h e r e ? through t h a t th in g 6 about the £ 1 9 ,0 0 0 . 7 some e x p e n s e o r o t h e r o r s o m e t h i n g c o n n e c t e d w i t h 8 a join t 9 t he m t h a t in vestm en t between e i t h e r C am ille p a id out, 10 I am o n l y g u e s s i n g , 11 Pine S e c u r i t i e s . 12 250 Q Yes. I t h i n k t h a t was p r o b a b l y Thank y o u , Mr. Turvey. s ho w Mr. 14 have t o 15 is 16 w i t h more t h a n £ 1 0 , 0 0 0 . 17 MS. MACKEY: T u r v e y number 71A another l i s t from i t (Exhibit It f r om You w i l l list. This & Mahon o f p e r s o n s is 71A. It is j u s t b e f o r e page 71. It is th e page between a nd 71 o r b e t w e e n 70 and 72 20 MR. 251 Q 11)? the n on -relevan t 19 DALY: share I wonder w o u ld you from G u in n e s s 18 21 p o s s i b l y now b e c a u s e and g o t b a c k h i s 13 exclude two or t h r e e o f (Exhibit 69 11). Okay. JUDGE O'LEARY: There are p e o p le 22 -- the r e a s o n I am s h o w i n g y o u 23 th is 24 want you t o u n d e r s t a n d t h a t 25 w h i c h we h a v e t h e b o r r o w i n g s w e n t on f o r p e r i o d o f 26 eigh t 27 A 28 252 Q 29 A is that it is a 1974 d o c u m e n t . Y e s? according to years? The b o r r o w i n g i n C a m i l l e I just Investm ents? evidence 1 253 Q 2 3 Rather than th e s h o r t e r p e r i o d o f tim e t o which y o u h a v e o r i g i n a l l y made r e f e r e n c e ? A 4 Yes. W ell, just 5 254 Q 6 A that now, I think I d id n 't recollect 8 were a s s e t s 9 shares 11 A 12 256 Q against against it. There were t h e So , it may e a s i l y b e t h a t You m i g h t j u s t t h e b o r r o w in g s went on. have a lo o k a t t h a t t h e r e say i s 15 b o r r o w e r s who owed t h e m o v e r £ 1 0 , 0 0 0 16 that 257 Q 19 A Yes. an d yo u w i l l a GMI l i s t it is Yes, I see it and you can s e e You c a n s e e t h a t ? Yes. Now, I think that as 22 s ho w i t . A I there. 21 24 This as 1975 t h e r e ? o f t h a t had b e e n wrong. 258 Q see th at. p r o d u c e d b y t h em o f v a r i o u s 20 23 and Yes ? 14 18 stocks it. (indicating) A There t h e whole tim e b e c a u s e t h e r e 13 17 is that. I was t h i n k i n g o f o n e p a r t i c u l a r b o r r o w i n g . was a r u n n i n g o v e r d r a f t 255 Q It Yes ? 7 10 I may w r o ng t h e r e . I s a id the Cam ille is it. It is My r e c o l l e c t i o n quite p o ssib le Investm ents and a c c o u n t s would Yes ? It is quite p o ssib le t h e r e was an o v e r d r a f t a l l 25 tim e because th e a s s e t s , 26 there 27 a nd s h a r e s h e was h o p i n g t h a t 28 c a p i t a l g r o w t h o v e r t h e p e r i o d and t h e 29 s h a r e s w o u l d e n d up w o r t h mo re t h a n t h e money against it a nd l i k e the stocks a nd s h a r e s , any one i n v e s t i n g it the were stocks would a c h ie v e stocks and 1 2 2 5 9 Q. 3 Yes, to 4 A. 5 2 6 0 Q. yes. I t h i n k we c a n l e a v e C a m i l l e o n e s i d e now, Mr. Turvey? Yes. Can I t a k e it that you a r e s a y i n g t o us t h a t 6 Pine S e c u r i t i e s 7 Mr. 8 a Mr. M c Go n a g l e c o n n e c t i o n ? A. Yes, 10 2 6 1 Q. Y e s? 11 A. Yes. 12 2 62 Q. 13 A. 14 2 6 3 Q. 15 A. 16 264 Q. 17 A. 18 2 65 Q. 19 A. 2 6 6 Q. 22 A. 23 D i d y o u do wo r k f o r t h a t I did because Yes. Company? I w o r k e d w i t h Mr. Finnegan. T ha t w o u l d h a v e b e e n p a r t o f my d u t i e s ? I was an e m p l o y e e . Your o r d i n a r y work? I t would, yes. Yes? I was an e m p l o y e e o f t h e Company b u t I w o r k e d Y e s? I n more o r l e s s the same way a s I a d v i s e d Liam M c Go na g le on a f r i e n d s h i p b a s i s . 24 267 Q. 25 A. 26 2 68 Q. 27 29 absolutely. w i t h hi m on h i s p e r s o n a l a f f a i r s . 21 28 was a co mpa ny w h i c h h a d a Finnegan c o n n e c t io n r a t h e r than 9 20 Investm ents Y e s? I did i t Yes. i n F i n n e g a n Me nt on a s p a r t o f my d u t i e s . Do y o u know w h e t h e r t h a t borrowings A. It had. It Company h a d from t im e t o tim e ? ha d v e r y v e r y b i g b o r r o w i n g s . 1 2 270 Q 3 Do y o u know w h e t h e r t h e y w e r e s e c u r e d b y o f f - s h o r e d eposits ? 4 A 5 271 Q 6 A 7 272 Q 8 Yes . T he y w e r e ? Yes . Okay. What was t h e l o c a t i o n of those to your knowledge? 9 A 10 273 Q 11 A Yes . 12 274 Q Yes. 13 A Yes . 14 275 Q 15 A 16 276 Q The s a m e . I t was t h e Cayman I s l a n d s . The Cayman I s l a n d s ? G u i n n e s s Mahon Cayman T r u s t ; Or s u b s e q u e n t l y We h a v e v a r i o u s documents which would s u g g e s t 18 p oint i n us l a b o u r in g t h a t p o i n t . 19 a Mr. Sam F i e l d - C o r b e r t t ? 21 277 Q 22 A 23 that is your view t h e r e 278 Q 25 A 26 279 Q 27 A is that no Do y o u remember I do. Had h e an i n v o l v e m e n t Not r e a l l y b u t in Pine S e c u r i t i e s ? I t h i n k h e was a d i r e c t o r t h e Company h a d b e e n s e t up b y G u i n n e s s 24 correct? Yes . but o b v io u sly i f A that "Ansbacher"? 17 20 is in that & Mahon. Yes ? Or b y Des T r a y n o r . Y e s? And Sam F i e l d - C o r b e t t was i n t h e b u s i n e s s of 28 a c t i n g a s a Company S e c r e t a r i a l O f f i c e w h e r e 29 they r e g iste r e d companies. 1 280 Q 2 A 3 Formed c o m p a n i e s , d id annual r e tu r n s fo r companies a nd s u p p l i e d d i r e c t o r s . 4 281 Q 5 A Yes ? Whic h was a f a i r l y common p r a c t i c e 6 t o have nominee d i r e c t o r s 7 w i t h t h e Company. 8 282 Q 9 A 10 283 Q 11 Yes, in th o s e days; who h a d no c o n n e c t i o n yes? And he was o n e o f t h o s e . Yes. Did he have any b e n e f i c i a l ownership in t h e Company? 12 A 13 284 Q 14 No, Yes. no, no. Was h e t h e man who made t h e a r r a n g e m e n t s fo r th e back to back f a c i l i t i e s 15 A 16 285 Q 17 A I w o u ld n 't have thought in a l l so. Yes ? He p r o b a b l y w o u l d h a v e b e e n a w a r e o f t h e m b u t 18 I w o u l d n ' t h a v e t h o u g h t h e made t h e 19 I would have th o u g h t t h a t 20 made t h e 21 the 22 286 Q 23 A 24 of that? arrangements. Liam M cG o n ag l e w o u l d h a v e a r r a n g e m e n t s o r Des T r a y n o r w o u l d h a v e made arrangements f o r Liam M c G o n a g l e . Y e s? D i r e c t w i t h Liam M c Go na g le r a t h e r t h a n w i t h Sam F i e l d C o r b e t t . 25 287 Q 26 A Yes ? I would have th o u g h t t h a t Sam F i e l d - C o r b e t t ' s 27 i n v o l v e m e n t was s i m p l y a s a p r o v i d e r o f company 28 secretarial 29 288 Q services. 1 A. Simply th a t it was Joh n F i n n e g a n ' s 2 can 't 3 no, 4 have been a cheque s i g n a t a r y a t 2 8 9 Q. 6 A. Yes. 7 2 9 0 Q. Y e s? 8 A. 9 2 91 Q. 11 A. 12 292 Q. 13 A. 14 2 93 Q. 15 A. 16 t h i n k h e d i d make me S e c r e t a r y . I may some s t a g e . A cheque s ig n a t o r y ? I don't think I was S e c r e t a r y a n d I c e r t a i n l y w a s n ' t Y e s? Because I think the d i r e c t o r s . . . However, you m i g h t h a v e had s i g n i n g a u t h o r i t y ? I could have, yes. Y e s? I think I d i d f o r some t i m e . I don't know f o r how l o n g . 294 Q. Yes. T ha t Company, Pine S e c u r i t i e s Lim ited: Do 18 y o u know t h e name o f t h e e n t i t y t h a t was p r o v i d i n g 19 it 20 A. w ith th e back to back f a c i l i t y ? I did at the tim e. 21 stage 22 t h a t was i t 23 sure . 24 I a D i r e c t o r t o my r e c o l l e c t i o n . 10 17 Now, reme mbe r b u t he may h a v e made me S e c r e t a r y I don't 5 company. 2 95 Q. 25 called You a r e n o t T h e r e was a c omp any a t High Seas some In vestm ents but whether or not I don't know. I am n o t q u i t e sure. Ms. Ma c ke y s e e m s t o t h i n k t h a t we a r e a w a r e o f t h e name o f t h e Company? 26 A. 27 2 9 6 Q. Yes. I am n o t c e r t a i n now. B e c a u s e i n a document t h a t 28 it 29 actually refer they ju st talk I have here d e a l i n g w ith about th e o th e r side. t o t h e Company b y name? The y do n o t 1 2 297 Q 3 A That i s Yes. page 1 7 0? I know t h e r e was a Company o u t t h e r e 4 H i g h S e a s and I know t h a t 5 but I th in k i t 6 y e a r s High S e a s w a s n ' t t h e r e . 7 298 Q 8 A 9 10 But i t 12 (Same Handed) 14 300 Q 15 A 16 301 Q 17 I know i n l a t e r name t o som ething e l s e r e m e mb e r. You m i g h t s how Mr. because A changed b eca u se must have changed i t s 11 13 t h e r e was a c o n n e c t i o n I understand? which I c a n ' t 299 Q Turvey page 117 I have another q u e s t io n t o (Exhibit (Exhibit A 19 302 Q 20 A 21 303 Q a s k t h e m on t h a t 12)? Thank y o u . This i s a 1978 d ocum ent, Mr. Turvey (Exhibit You w e r e w o r k i n g i n F i n n e g a n M ent on a t t h a t I was, stage; yes. Or w h a t e v e r p a r t i c u l a r name t h e y h a d a t t h a t t i m e ? Yes . This i s 12) . 23 Leonard? 24 A 25 304 Q I think that That i s It an i n t e r n a l memo f r o m POD t o right, is a Mr. TRL ( E x h i b i t O' Dwy er a n d a Mr. yes. says: 26 29 12)? Yes . 22 28 12) w e r e yo u? 18 27 called "The a b o v e f a c i l i t y e x t e n d e d f o r a p e r i o d o f one y e a r a t t h a t tim e as p e r f a c i l i t y l e t t e r dated 15th A p r il 1978. The B a l a n c e was £ 3 6 0 , 5 8 5 . 0 8 i n t e r e s t r a t e 12% p e r annum f i x e d . JDT. . . " 1 2 Who I t h i n k i s 3 Yes, that is Mr. Traynor? right. 4 5 " . . . a s k e d me t o p h o n e Des T u r v e y t o d i s c u s s w i t h h im t h e p o s s i b i l i t y o f low erin g the i n t e r e s t r a te but at the same t i m e a p p l y i n g a r e a l i s t i c r a t e . A g r e e d t o make a l o a n a v a i l a b l e a t o n e a nd a h a l f p e r c e n t o v e r o n e y e a r f u n d s on t h e 1 8 t h A p r i l , i . e 11%, s u c h r a t e to apply fo r a year. B e a r i n g i n m in d t h a t i n t e r e s t was d e b i t e d 3 0 t h J u n e I s a i d we w o u l d a p p l y t h e new r a t e f r om 1 s t Ju ly 1978. Can y o u p l e a s e a d j u s t the "other sid e " . P le a se confirm at your con ven ien ce" ? 6 7 8 9 10 11 12 13 A T h a t i n d i c a t e d t h a t t h e r e was an i n t e r e s t 14 a r r ang em ent where w h a t e v e r r a t e 15 was c h a r g e d h e r e - - 16 a mount - - 17 in 18 306 Q 19 A 20 307 Q 21 A 22 23 in terest rate less on d e p o s i t s a certain was a d j u s t e d some way a c c o r d i n g l y . Yes ? So, that it was a b a c k i n g s i t u a t i o n . Y e s? And t h e y h a d some m e t h o d o f r e l a t i n g in terest 308 Q the that of in terest rates that gave Guinness t h e t wo & Mahon a m a r g i n . I t h i n k what t h e y a r e c o n v e y i n g t h e r e is that 24 fa cility is no l o n g e r 25 realistic 26 w o r d s o b v i o u s l y l o o k odd? 27 A 28 309 Q 29 A It does. letter w i t h a 12% f i x e d r a t e a nd t h a t It it seems t o sh o u ld be lo w e r . infer that. the In o t h e r 1 3 1 0 Q. 2 If you were p a y i n g t h e m a r k e t and g e t 3 A. Yes, 4 3 1 1 Q. Yes. 5 6 yes. It A. at 11% o r 10%? o b v io u sly does Do y o u reme mbe r t h o s e W ell, I re me mb e r t h e fact b e t w e e n t h e t wo i n t e r e s t 8 312 Q. 9 A. 10 infer that, yes. kind o f arrangem ents 3 13 Q. 12 A. Y e s? Bu t t o w h a t e x t e n t 14 w ith whatever the 16 A. 17 3 1 5 Q. 18 for & Mahon. rates 314 Q. rates. And t h a t t h e r e was a m a r g i n i n i t 13 15 t h e y had a r e l a t i o n s h i p Y e s? Guinness 11 I don't t h e y p la y e d around w it h th e know. I assumed t h e y went a lo n g g o i n g r a t e was a t t h e t i m e . Th e y d i d ? On o n e s i d e . But t h e y d i d i t in r e tr o sp e c t if you u n d e r s t a n d w h a t I mean? 19 A. 20 3 1 6 Q. 21 Yes, yes. You c a n a p p r e c i a t e now t h e y w e r e k i n d o f c a t c h i n g up h e r e ? 22 A. 23 317 Q. 24 Yes. You s e e o n e o f t h e p r o b l e m s is that in s o f a r as r a te s w ere c h a r g e d which were u n r e a l i s t i c ? 25 A. 26 318 Q. 27 29 it yourself? 7 28 12% when y o u c o u l d g o t o Yes. P r e s u m a b l y t h e r e was a t a x c r e d i t in resp ect of those? A. No, I don't think s o b e c a u s e t o my k n o w l e d g e 1 I d o n ' t t h i n k bank i n t e r e s t 2 for tax purposes. 3 319 Q 4 5 However, t h e y a p r o p e r t y company? A No, it was an i n v e s t m e n t c o m pa ny . property. 7 it 8 t h e r e was n e v e r t a x r e l i e f 9 h a v e b e e n t o my k n o w l e d g e . 10 320 Q 11 A 12 It The A u d i t o r s claim ed. There c o u l d n ' t c o u l d n ' t h a v e c l a i m e d t h e t a x u n l e s s my l e t t i n g me down v e r y b a d l y . I t may w e l l b e a s i t u a t i o n 15 c ompany who c o u l d c r e a t e 16 interest? 18 own Yes ? a nd l e n t A didn't was n o t a p r o p e r t y co mpa ny a n d t o my k n o w l e d g e memory i s 321 Q It l e n t money t o p r o p e r t y c o m p a n i e s b u t 14 17 charge w e r e t h e y an i n v e s t m e n t c ompa ny o r w e r e 6 13 was an a l l o w a b l e No, it w h e r e t h e y b o r r o w e d mone y on a t t h e same r a t e t o Pine S e c u r i t i e s in terest sim ply le n t a property or c o u ld charge t h e m one y t o t h e p r o p e r t y c o m p a n i e s a t no i n t e r e s t . 19 322 Q 20 A 21 323 Q 22 A 23 At no i n t e r e s t ? T he y d i d n ' t I see? Any more t h a n C a m i l l e in terest 24 324 Q 25 A 26 325 Q charge i n t e r e s t . I see. f o r w h at i t You a r e I'm p r a c t i c a l l y A ll righ t. 27 can l e a v e 28 few t h i n g s 29 L im ited; Investm ents d id n 't len t. fa irly sure o f th at; 100% c e r t a i n Very w e l l . the p o s itio n to charge of that, yes. Thank y o u v e r y much. o f t h a t now. a s k y ou on B r i t i s h nothing r e a lly a r e yo u? I have j u s t Isles o f any g r e a t We a Investm ents consequence. 1 As I t h i n k we f a i r l y w e l l 2 see 3 (Exhibit 4 Thank y o u . 5 326 Q 6 A 7 8 th is (in d icatin g); 9 A 11 328 Q 12 A I d o n ' t re me mbe r t h e Yes. I mean i t It to the tr u st 18 330 Q 19 Isles A 21 331 Q 22 yes. that or i t might be. t h a t b u t t o my k n o w l e d g e a nd i t was c h a r g e d t o Investm ents Lim ited. I t was c h a r g e d as a loan . Yes ? That i s my r e c o l l e c t i o n However, in r e a l i t y had a t h i s 20 of that type, I t was, it o f what h a p p e n e d t h e r e . was m one y w h i c h Mr. Mc Go na g l e d isposal? yes. And w h i c h h e was n o t r e a l l y u n d e r a n y o b l i g a t i o n repay? 23 A 24 332 Q 25 A 26 333 Q 27 A I f o r some p u r p o s e ? c o u l d be a n y t h i n g l i k e 15 A t r a n s a c t i o n but m i g h t b e g o i n g on h o l i d a y s B ritish 29 sp ecific Yes . 14 17 (Same Handed) Mr. M cG o n a g l e w o u l d b e d r a w i n g down money m on e y was drawn l i k e 329 Q do y o u I p r e s u m e y o u do n o t reme mbe r t h a t t r a n s a c t i o n ? 13 16 121 situ ation 13)? t h a t he w o u l d r e q u i r e 10 28 page do reme mbe r a t r a n s a c t i o n 327 Q know t h e T h a t he w h a t ? He was n o t u n d e r a n y r e a l o b lig a tio n to To r e p a y ? Y e s? Probably n o t. Probably n o t, yes. repay? to 1 2 MS. MACKEY: Mr. 3 Isles 4 5 have a c c o u n ts A 6 in Guinness did B r itis h Investm ents Lim ited & Mahon i n i t s own name? When i t t o an I . . . (INTERJECTION). MS. MACKEY: 7 refers account th ere 8 9 Turvey, (Exhibit A Yes, (indicating) 13). I th in k th ey probably d id . Guinness & Mahon 10 h a d some a r r a n g e m e n t w h e r e b y t h e y w e r e a b l e t o draw 11 m on e y and c h a r g e i t . 12 MS. MACKEY: 13 A To B r i t i s h 14 said 15 MR. Yes. Isles Investm ents Lim ited. som ething t h e r e , DALY: J u s t on t h e h a v e b e e n t a k i n g t h e mone y o u t 18 know. A I d idn't. I don't really JUDGE O'LEARY: 22 in tervention. 23 way t o a n s w e r a q u e s t i o n . 24 w itness. 25 is 26 to in s tr u c t 27 p a r t i c u l a r way. 29 You w o u l d n ' t know. is quite for. W ell, 21 28 question of w h a t Liam M cG on a g le m i g h t 17 20 you J o hn? 16 19 Sorry, I t h i n k now t h a t a quite You s h o u l d n o t t e l l unhelpful Mr. T u r v e y wh at You a r e i n s t r u c t i n g the A c o n s u l t a t i o n b e t w e e n y o u a nd t h e w i t n e s s a d iffe r e n t m atter. the w itness You a r e n o t e n t i t l e d t o answer a q u e s t i o n in a 1 2 JUDGE O'LEARY: 3 I am n o t i n t e r e s t e d in your i n s t r u c t i o n s . I 4 w o u l d n o t a s k y o u w h at y o u r i n s t r u c t i o n s 5 I t w o u l d b e i m p r o p e r o f me a n d I do n o t w a n t t o 6 know w h at y o u r i n s t r u c t i o n s 7 Mr. 8 A. 9 3 3 6 Q. Turvey page 11 to B r itish 12 M essrs. 13 is 15 337 Q. y o u w o u l d show (Exhibit 14)? Whic h y o u may h a v e h a d no p e r s o n a l i n v o l v e m e n t at a ll, A. (Same Handed) If Thank y o u . 10 14 124 are. were. Mr. Yes. Isles but th a t apparently i s a payment In v e stm e n ts L im ite d t o pay D u d g e o n s who w e r e t h e th a t not That i s Turvey, in stock brokers; correct? right, yes. What I am p a r t i c u l a r l y in terested in is: 16 17 "I h a v e d e b i t e d t h e A/E D o l l a r D e p o s i t "? 18 19 20 A. T h a t was B r i t i s h Isles. 21 338 Q. T h a t was B r i t i s h Isles? 22 A. 23 3 3 9 Q. 24 A. 25 3 4 0 Q. 26 T h a t was an a b b r e v i a t i o n o r a c o d e o r w h a t e v e r . A code which t h e y used? Yes . I see. A r e y o u a w a re o f a n y o t h e r c o d e s t h a t w e r e used? 27 A. 28 3 4 1 Q. 29 A. That i s the one t h a t c o m es t o my m i n d i m m e d i a t e l y . Y e s? Because I was a w a r e o f i t . 50 Now, t h e y may h a v e h ad 1 some o t h e r o n e b u t i f 2 recollect 3 Yes. 4 (Exhibit 5 d r a w s my a t t e n t i o n 6 is 7 that? 8 A 9 343 Q them b u t Ms. 15). reference Ms. Th e y a r e v a r i o u s in stru ction s Guinness & Mahon? She w a s , yes. 344 Q t o p a g e 74 And y o u h a d v a r i o u s t h i n g s con v ert or d e s ig n a t e 15 a cco u n t t o E n g l i s h pounds? A 17 345 Q 18 A I assume - - see it's a ll "N" And I a s s u m e t h a t " N " a c c o u n t m u s t h a v e b e e n r eme mbe r i t 21 currency, A t o do b u t u l t i m a t e l y Yes ? 20 23 to A nette Beecher h e a d e d A/ E a c c o u n t . s o m e t h i n g u n d e r A/E i n t h e 346 Q do I u n d e r s t a n d I r i s h pounds i n t h e 19 22 This o n l y was a s an e m p l o y e e o f t h e 14 16 (Same H a n d e d ) . I do. 11 13 that. Mackey knows e v e r y t h i n g and s h e t o t h e A/E a c c o u n t s ; who a p p e a r s A I do r e c o l l e c t I don't Ma c ke y d r a ws my a t t e n t i o n t o p a g e 74 10 12 t h e r e were o t h e r s but i t same g r o u p . I don't m igh t e a s i l y be i n d i c a t i n g a y ou know? Y e s? I t m ight. I n o t h e r w o r d s w i t h i n t h e A/E t h i n g t h e r e 24 might have been a s t e r l i n g 25 a c c o u n t o r w h a t e v e r and o n e o f t h em m i g h t h a v e b e e n 26 called 27 347 Q 28 29 Yes. "N" a c c o u n t . I don't recollect. You t h i n k t h e r e may h a v e b e e n s u b a c c o u n t s u n d e r t h e A/E a c c o u n t ? A acco u n t or a d o l l a r 1 348 Q 2 Yes. the"N" a c c o u n t ? 3 A No. 4 349 Q No? 5 A No, 6 350 Q 7 A I can't re me mbe r o n e . Y e s? The o n l y o n e I reme mbe r i s code fo r B r i t i s h 8 9 A re y o u f a m i l i a r w i t h a n y m a i n a c c o u n t c a l l e d 351 Q Yes. Isles. Did C a m i l l e I n v e s t m e n t s have any such 10 lodgments th e m se lv e s 11 them selves ? 12 A A/ E w h i c h I r e g a r d a s t h e or any such a c c o u n t s I w o u ld n 't have thought so becau se C am ille 13 I n v e s t m e n t s was n o t an o f f - s h o r e 14 i n a n y way s o 15 T he y w o u l d , 16 352 Q 17 It is just situ ation I w ou ld n 't have thought so. y o u k n o w . . . (INTERJECTION). that there is a n o t e down a t t h e e n d o f that: 18 19 "File: C am ille I n v e s t m e n t s Company." 20 21 F ile: 22 somebody's h a n d w ritin g th a t 23 know. C am ille Is I n v e s t m e n t s a p p e a r s t o be w r i t t e n that you w r i t i n g t h e r e 24 A 25 353 Q 26 A I don't know. 27 354 Q That i s helpful? 28 A I don't know t h a t . 29 355 Q No, It i t ' s not, is not. c o u l d b e GMI a s y ou no. A ll right? "Company"? in 1 2 356 Q 3 4 Mr. M c Go na g le h a d b u s i n e s s w i t h a man b y t h e name o f Waldron; A 5 Yes. is W ell, th at not righ t? he i n d u l g e d i n a few i n v e s t m e n t s t h a t w e r e O l i v e r W a l dr o n c o n n e c t e d . 6 357 Q 7 A 8 358 Q 9 I do n o t w a n t t o know a n y t h i n g a b o u t t h a t ? Yes . Because th ere is a fa m ily c o n n e c tio n between Dr. W a l d r o n a nd m y s e l f ? 10 A I see . 11 359 Q I just do n o t w a nt t o 12 A R ight, right. 13 360 Q So, any q u e s t i o n s 14 if w i t h b y Ms. 15 A 16 361 Q Yes. 17 A Yes . 18 362 Q R ight, M ac ke y; know? arise on t h a t okay. It is nothing at a l l I am n o t d e a l i n g w i t h t h a t t o do w i t h me? case. a p p r e c i a t e w i t h s o many p e o p l e 20 bound t o be p e o p l e 21 o n e o f u s knows? A 23 363 Q 24 A 25 364 Q 26 A 27 Yes, 365 Q 29 A As y o u w i l l involved there Or i s c o n n e c t e d w i t h i n some way? Yes . We w i l l W ell, just leave A ll that t o one s i d e ? O l i v e r Waldron s i m p l y s u g g e s t e d a c o u p l e right? is f r om t i m e t o t i m e t h a t we know o r sure. of investm ents 28 w i l l be d e a l t y ou s e e ? 19 22 it t o him. 1 3 66 Q 2 W ell, sure th a t is grand. Yes. B eresford Investm ents? 3 A 4 367 Q 5 A That's a l o n g l o n g way b a c k b e f o r e my t i m e r e a l l y . Yes ? And i t was a l l p a rt o f a p r o p e r ty development 6 group which in c l u d e d s e v e r a l 7 o f Guinness 8 368 Q 9 A 10 of the d ir e c to r s & Mahon. Y e s? And Liam h a d an i n v o l v e m e n t . J o hn F i n n e g a n h a d an involvem ent. 11 369 Q 12 A Yes. What d i d t h e y do? O rigin ally, as f a r as 13 now. 14 k n o w l e d g e a n y wa y. 15 370 Q 16 A I know, I t would be b e f o r e th is I reme mbe r t h e file being th ere. 18 somewhere b e h i n d t h e 19 W a r e h o u s e o r some name l i k e 20 it 21 way w i t h t h e M a r l b o r o u g h Gr oup . 23 24 25 26 27 but I reme mbe r s e e i n g I th in k th e y d ev elo p ed a warehouse Fo ur C o u r t s . I a s k you a b o u t t h a t : first of a ll? Beresford that. T he y d e v e l o p e d Do y o u know who owned Who owne d t h e Company? know. DALY: Ju st a m inute. B u t I . . . (INTERJECTION) . MR. DALY: 28 29 t o my a nd I t h i n k t h e Company was c o n n e c t e d i n some I don't MR. A on i t Before it A 1960's Y e s? stuff 371 Q being the I was i n v o l v e d ; 17 22 What a b o u t Ju st a m inute, clien t questions is Judge. My answering th e s e on t h e p r e s u m p t i o n t h a t t h e y a r e c o n n e c t e d 1 with the 2 C harters. 3 JUDGE O'LEARY: No. 4 MR. I f there affairs o f Mr. M cG o n ag l e a nd K i n s a l e Y a c h t DALY: 5 connections 6 Mr. 7 about th o s e m a tters 8 would s t i c k 9 372 Q then T u r v e y h a s come h e r e t o d a y t o a n s w e r q u e s t i o n s and I w o u l d b e o b l i g e d i f JUDGE O'LEARY: Yes, Mr. 11 issues 12 t h a t we w o u l d m e e t h e a d o n . 13 w h i c h was s e n t 14 sent to 15 A 16 373 Q 17 A 18 374 Q Yes ? 19 A Yes . 20 375 Q a challenge to I see. Turvey, I see, t o us which I t h i n k i s you; letter 28 29 t h a t was From yo u? Yes ? Yes, I have, I w ill yes. read the r e le v a n t p o r tio n of the (Exhibit letter 16): "We c o n s i d e r t h a t you a r e a p e r s o n . . . " That i s a d d r e s s in g your g o o d s e l f , 26 27 letter yo u? 24 25 as w e ll Do y o u h a v e t h e a copy o f th e yes. your s o l i c i t o r 22 23 you to th at. 10 21 a r e no " . . .who e i t h e r i s o r may b e i n p o s s e s s io n of inform ation concerning th e a f f a i r s o f th e Company..." 1 2 3 " . . . a n d a c c o r d i n g l y we h e r e b y r e q u i r e you t o a f f o r d us a l l a s s i s t a n c e i n c o n n e c t i o n w i t h our i n v e s t i g a t i o n t h a t you a r e r e a s o n a b l y a b l e t o g i v e . . . " 4 5 6 7 Able t o g i v e 8 t o be d o i n g t h a t 9 A. 10 3 7 6 Q. and I must s a y , to the b est Mr. Turvey, you ap p ea r o f your a b i l i t y ? Yes. 11 12 13 14 15 "To t h i s e n d we r e q u i r e y o u t o a t t e n d a t our o f f i c e t o p r o v i d e e v i d e n c e u n d e r o a t h on r e l e v a n t m a t t e r s a nd s p e c i f i c a l l y i n r e l a t i o n t o y o u r d e a l i n g s on b e h a l f o f Mr. Liam M c Go na g le a nd a s a D i r e c t o r o f K i n s a l e Yacht C h a r t e r s L td ." 16 17 I do n o t 18 inferen ce 19 d e a l i n g w i t h K i n s a l e Yacht C h a r t e r s 20 K i n s a l e Y a c h t C h a r t e r s a n d Mr. 21 I think - - 22 y o u s o f a r h a d h a d a M c Go na g le c o n n e c t i o n . 23 w ill 24 y o u a t t h e e n d w h i c h do n o t h a v e a Mc Go na g le 25 c o n n e c t i o n but t h e y are c o v e r e d by t h i s 26 course 27 b a c k a n o t h e r da y and d e a l w i t h t h a t " . 28 d ifficu lty 29 we w i l l b e a s k i n g y ou a b o u t r e l e v a n t m a t t e r s and know how y o u r s o l i c i t o r from t h a t so c o u l d dr aw an t h a t we a r e r e s t r i c t e d or in d e e d Liam M c G o n a g l e . f a r a s any q u e s t i o n in f a c t have a s e r i e s I have asked of questions your d i s a d v a n t a g e d you can s a y , with th a t at a l l ; to I for a nd o f "I w i l l come I h a v e no none a t a l l . However, 1 these relevant matters may not be exclusively 2 related to Mr. McGonagle or Kinsale Yacht Charters. 3 Do you understand, Mr. Turvey? 4 Yes, fine. 5 377 Q 6 and I am noting that? 7 A 8 378 Q 9 A 10 379 Q 11 12 Could I say that your attitude is extremely helpful Yes . That your attitude is extremely helpful; all right? Yes (indicating). I will proceed. Beresford Investments Limited: Do you know who owed that at all? A No, I would assume it was that group of people that 13 I mentioned; some directors of Guinness & Mahon, 14 Des Traynor, may be John Guinness. 15 380 Q 16 A 17 381 Q Yes ? 18 A Yes . 19 382 Q 20 A 21 383 Q 22 A 23 384 Q 24 25 Was Mr. McGonagle involved in it? He was I think, yes. Yes? Yes . Yes. You see I think he was in fact myself too? Yes, yes. And I think it may have lasted a little longer than you think? A Well, it may have but I was never connected with 26 Beresford the way I was connected with the other 27 things we have discussed up to now. 28 385 Q 29 A Yes? And therefore I would be a bit vague about it 57 1 2 386 Q. 3 A. All right? Now, I may have been asked to do something at some 4 stage or to carry a message connected with it but 5 didn't know any of the details of that thing. 6 387 Q. 7 I see. Because we have documentation which seems to suggest that you had an involvement in it? 8 A. 9 388 Q. 10 A. 11 389 Q. 12 A. 13 390 Q. 14 Yes. I am not saying it was a deep involvement? Yes, yes. Or anything like that? Yes. What year again did you say you started in Mr. Finnegan's...(INTERJECTION)? 15 A. 1972. 16 391 Q. 1972? 17 A. 18 392 Q. Yes. In 1976 there was a letter to the Chairman of 19 Beresford Investments at 28A. 20 particularly involved in that but I will show it to 21 you to show that it was still operational at that 22 stage; do you understand? 23 A. 24 393 Q. Now, you are not Yes. And I will give you some other information later. 25 It is a facility letter, yes. 26 details of the facility letter...(INTERJECTION). 27 MS. CUMMINS: 28 or 28A. 28 JUDGE O'LEARY: 128A. 29 I Page 28A. The 1 2 3 394 Q 4 MS. MACKEY: You did. JUDGE O'LEARY: 128A (Same Handed) (Exhibit 17)? 5 A 6 395 Q 7 A 8 396 Q 9 That's ...(INTERJECTION). That is it there now? That is it I think; a facility letter. The 6th December 1976. Is that the one you have; is it? 10 A 11 397 Q It is, yes. All right. The only purpose of me showing you that 12 was that the operation, the Beresford operation, 13 whatever it was, was still of some significance in 14 1976? 15 A 16 398 Q 17 A 18 399 Q 19 A 20 400 Q 21 A Yes . That it was long after you had started? It was, yes. In the Company? Yes . Yes. That was not your memory of it? Yes, it wasn't. I thought that Beresford's 22 activities had all preceded my coming into it. 23 Now, I mean I would have thought it at the time 24 but I thought it now. 25 you asked the question I would have said it was 26 all finished or done with. 27 401 Q 28 A 29 402 Q At this point in time if Yes? I now realise it can't have been. Yes? 1 2 403 Q. 3 A. 4 404 Q. 5 Yes? So, I couldn't be too sure. Do you know whether it was a suitably secured situation? 6 A. 7 405 Q. I wouldn't have thought so but I don't know. If you would look at 130 before answering the 8 question again (Same Handed) 9 not want to catch anybody out. 10 purpose of the exercise. 11 extension of a loan. 12 are dealing with here? 13 A. 14 406 Q. 15 A. 16 407 Q. (Exhibit 18)? That is not the This is obviously an That is what it is; what we Yes. An extension for a period of one year? Yes. Do you see there: 17 18 "88% suitably secured"? 19 20 A. 21 408 Q. 22 A. 24 409 Q. 25 A. 26 410 Q. 27 A. 28 411 Q. 29 88% suitably secured; I do. Really my interest in it is whose money was suitably securing it? 23 I do Yes. Do you understand what I mean? Yes, I d o . That is really my interest? I do. I do not care about the rest of it? 1 2 412 Q Yes ? 3 A Yes . 4 413 Q 5 A 6 414 Q 7 A Yes. I would be very surprised if it was. 8 415 Q Yes. However, have you any idea who it was? 9 A You see that is why I am interested? Yes . Because I suspect it might not be? I haven't but there was a group of people involved 10 in that and he was one of a group. 11 lot of names. 12 416 Q 13 A There were a Who was the main player? I don't know but I was going to say it could have 14 been Guinness & Mahon themselves but I'm not really 15 sure. 16 know. 17 417 Q 18 A 19 418 Q 20 A It is not the case of I'm not sure; I don't You do not know? No. I mean was Mr. Finnegan the main player in it? I doubt it. He was probably involved in it the way 21 Liam McGonagle was but I would doubt very much he 22 was the main player. 23 419 Q 24 A 25 Yes ? I always regarded it as closely connected with Guinness & Mahon. 26 420 Q 27 A 28 421 Q 29 I doubt it. Did you? Yes . Do you mean by Des Traynor rather than Guinness & Mahon? 1 Yes. 2 Guinness & Mahon as well. 3 422 Q 4 A 5 423 Q 6 A Well, I mean Des Traynor and others in Like for example? The late John Guinness himself. Yes ? Even though he mightn't have partaken in it but 7 I think he may have had some involvement. 8 my difficulty here is that I wasn't closely enough 9 involved with it to know who the people were. 10 424 Q Yes. Now, We have other information, some of this 11 information is good and some of it is not good but 12 we have information, which would suggest that there 13 may have been a Ken 0'Reilly-Hyland involvement? 14 A There could have been, yes. There could have been. 15 If Liam McGonagle and John Finnegan were there may 16 easily have been a Ken 0'Reilly-Hyland involvement; 17 easily. 18 425 Q 19 A 20 426 Q 21 A 22 427 Q 23 A 24 25 Because they went very much together; did they? They did. Yes? But I think there were a lot more. There were a lot more? This wouldn't be a situation where they were prime movers in it. 428 Q 26 You see my interest in it is really whose money was suitably secured? 27 A 28 429 Q 29 A Yes, yes, I see that. That is my interest in it? 1 2 I see, I see. 3 in due course when this is over he can pass it on to 4 his solicitor and his solicitor can see that it is 5 relevant, pages 133 & 134 6 & 20) ? 7 A 8 431 Q 9 (Same Handed) (Exhibit 19 Thanks. I think it may be useful if you look at Number 134 (Exhibit 20) first because that is the outcome of 10 11 You might show Mr. Turvey, so as that 133? A Yes. I certainly don't remember it but it would 12 seem to indicate that Liam McGonagle was a fairly 13 significant person in it; in the group or whatever. 14 432 Q 15 16 Yes, yes. You cannot help us any further in that regard; can you? A 17 I am just reading the other, the 133, now. a moment 18 433 Q 19 A Just (Exhibit 19)? Yes ? I have no recollection of this I must say but I 20 think it was probably something that Liam asked 21 me to do and I did. 22 434 Q 23 A Yes. Yes ? I was certainly never aware and I can't recollect 24 any outcome of that Beresford Investment thing. 25 I don't know whether profits if any went or if 26 it made profits. 27 435 Q 28 A 29 436 Q Yes? I just don't know. Yes. Where were you on the 4th April 1972 in 63 1 2 I had joined Finnegan and Menton. 3 437 Q 4 A I do not mean physically where you were that day? Yes. I had just joined Finnegan Menton in 1972. 5 can't remember what time of the year but 1972. 6 think it was early in the year. 7 438 Q 8 A 9 439 Q 10 A 12 440 Q I Was it? Yes . Yes, I wonder would you show Mr. Turvey page 136 (Same Handed) 11 I (Exhibit 21)? Thanks. Were you familiar with the establishment by Mr. Finnegan of a discretionary trust? 13 14 A 15 441 Q 16 A 17 442 Q 18 A 19 443 Q I was. Yes? But only from the time I went in in 1972. Yes ? And not prior to that. Yes. You see it appears that it was established 20 on the 4th April 1972 and the details of it are not 21 relevant really. 22 way or the other? 23 A 24 444 Q They are of any great concern one Yes . Many of these trusts were established on that date 25 or the dates immediately preceeding it and they 26 could well have been reasons why that was done; 27 Capital Gains reasons and various other reasons? 28 29 A The 4th April being the significant date. 1 On the other hand Capital Gains Tax to my 2 recollection, 3 come until April 1974. 4 446 Q 5 A 6 447 Q 7 A 8 448 Q 9 I think that is true? Yes . I think that is true? Yes . There could however have been exchange control changes around that time as well? 10 A 11 449 Q 12 13 I am fairly sure of it, didn't Yes . I think the Cayman situation was in a state of flux. I do not know the reason for it? A 14 But I think we remained in the Sterling area until long after that. 15 450 Q 16 A 17 451 Q 18 A 19 452 Q 20 A 21 453 Q We did? Ireland. However, did they? Did the Cayman? Yes? I see, yes. Yes, that is the question. The question I am 22 asking is this: 23 case, or in the other case that you know about, 24 of whether the trusts were in fact established 25 on those dates or whether they were back dated 26 to those dates? 27 I wouldn't think they were back dated because when 28 I joined Finnegan Menton in 1972 I was told then, 29 certainly in Liam's case, about the existence of Have you any knowledge in this 1 2 454 Q. 3 A. 4 Yes? And I would think that John Finnegan would have set up his trust at the same time as Liam McGonagle did. 5 455 Q. 6 A. Yes? My recollection is that they were there before I 7 became involved. 8 (Exhibit 21) 9 listening to you. 10 11 Now, I haven't read that letter (indicating). I was just kind of I haven't read that letter fully yet. 456 Q. 12 Basically all it says is that it says what is to be done in the event of Mr. Finnegan dying? 13 A. 14 457 Q. 15 A. 16 458 Q. 17 A. 18 459 Q. 19 A. 20 460 Q. 21 A. 22 Yes. The details of that are not relevant? Yes. The relevant point is the 4th April 1972? Yes, yes. That is the point I am asking you about really? Yes, yes. You are not able to assist us in that regard? No, I am not because I think certainly in Liam McGonagle's case that his trust existed before that. 23 461 Q. 24 A. 25 462 Q. 26 A. 27 463 Q. Okay? And I am nearly sure that John Finnegan's did. Fine? But I am not as sure as I am about Liam McGonagle's. I understand, yes. 28 you very much. 29 in New York? That is very helpful. Thank Mr. Turvey, who was Mary O'Reilly 1 I never heard of Mary O'Reilly. 2 -- I do not know who Mary O'Reilly is. 3 464 Q 4 I will be asking you about other O'Reillys later on now and where you were working? 5 A 6 465 Q 7 A 8 4 66 Q 9 Yes . That is another thing? Yes . However, I am not interested in that for the moment. I do not want you to confuse those unless they are 10 the same people? 11 A 12 467 Q 13 Yes . Would you show Mr. Turvey two letters; 138 & 139 (Same Handed) 14 A 15 468 Q 16 17 I have never heard (Exhibit 22 & 23)? Thank you. Apparently you were in favour for three years, Mr. Turvey, but after that you were no longer able? A Now, I never -- I know now who Mary O'Reilly is. 18 She is either the actual or the imagined relation 19 of Mr. Jackie O'Reilly who was the Chairman Managing 20 Director, sole owner, of O'Reilly Aerlod that I went 21 to work with in 1984. 22 4 69 Q 23 A 24 470 Q 25 A 26 Now, how or why? She was not his actual wife? No, she is not his wife. His wif's name was Patricia, that is right. 27 471 Q 28 A 29 Yes? That is correct. Yes? And he had a daughter, an adopted daughter, called Mary but she was only a child at that stage. I 1 think Mary O'Reilly was think he told me she was a 2 cousin of his but he was the kind of person who 3 invented all kinds of things in his mind and there 4 might not have been any cousin at all for all I 5 know. 6 472 Q 7 A 8 473 Q 9 Yes? To withdraw funds. So, it is connected with O'Reilly Aerlod in some way? 10 A 11 474 Q Do you remember what the whole purpose of this was? 12 A I don't and I want to add that I never withdrew any He was the founder. funds whatever certainly for me. 13 14 475 Q 15 A 16 476 Q 17 Yes, I understand. Yes? Never. Yes, yes. Could we move on so to the O'Reilly Aerlod situation? 18 A 19 477 Q Yes . As I understand it O'Reilly Aerlod was a company 20 which was owned by Mr. J.K O'Reilly; is that 21 correct? 22 A 23 478 Q 24 That is right, yes. I think it had been a subsidiary ultimately originally of CIE or something like that? 25 A 26 479 Q 27 A 28 480 Q 29 A It was. It was originally Aerlod Teoranta. Yes? And Jackie O'Reilly bought it from CIE. Yes? 1 481 Q 2 A 3 Golly, he ran it until I would say some time about 1988/1989/1990; 4 482 Q 5 A 6 some time around there. Yes ? And he was bought out by Irish Mainport Holdings Limited in Cork. 7 483 Q 8 A 9 484 Q Yes? It bought his interest in the Company. Yes. I have got a little bit of information that 10 might be of assistance in that regard elsewhere. 11 So, if we will adjourn may be for five minutes; 12 would that be okay with you? 13 A 14 485 Q 15 A 16 486 Q 17 A 18 487 Q Yes ? 19 A Tea. 20 488 Q 21 A 22 489 Q 23 A Certainly, yes. Would you like a cup of tea? I would love one, yes. Tea or coffee; whichever? Tea please. I will not be long more with this. Okay. This is really the only thing? Yes, okay. That is fine. 24 25 26 27 28 29 Thank you. SHORT ADJOURNMENT Thank you. 1 MR. DES TURVEY CONTINUED TO BE EXAMINED AS FOLLOWS 2 AFTER SHORTEN ADJOURNMENT BY JUDGE O'LEARY: 3 4 5 I just wanted to have a look at the Mary O'Reilly 6 letters again (Exhibit 22 & 23). 7 490 Q Yes, yes. I do want to emphasise to you, 8 Mr. Turvey, anything we raise here today if you have 9 second thoughts about it or you have additional 10 information feel perfectly free to write to us. 11 You have no difficulty in that regard? 12 A 13 491 Q 14 I will, righto, yes. Thank you. We might ask you to put it in affidavit in due course but write to us in the first instance? 15 A 16 492 Q 17 A 18 493 Q 19 Fine, yes. And we will see what the position is? Yes . The information available to me is that Mr. O'Reilly sold the Company? 20 A 21 494 Q 22 A 23 495 Q 24 A Yes . In about 1985 and died in 1988? Yes . Does that appear right to you? Yes. He lived for a couple of years after he sold 25 it which is quite true but that puzzles me about 26 that letter (indicating) because that letter 27 (indicating) then would appear to have been written 28 after he sold the Company. 29 on that letter? Is that -- what date is 1 2 1984. 3 MS. MACKEY: 4 A 5 4 96 Q Yes, that is all right. No that would be okay. That is okay, yes, yes. JUDGE O'LEARY: Yes. Could I make it clear: 6 7 I am attaching no significance to that letter at all (Exhibit 22)? 8 A 9 497 Q Yes, yes. I just wanted to bring it to your attention in case 10 you say, "Yes, that is his second wife," or he had a 11 girlfriend outside in New York? 12 A 13 498 Q 14 A 15 499 Q 16 Something like that? Yes . However, I really am attaching no significance to it? 17 A 18 500 Q 19 A 20 501 Q 21 A 22 502 Q 23 Right, right, yes. I would not worry about it? Yes . It is curious but that is all it is? It is . It is not going to play any significant part that I can see in it? 24 A 25 503 Q 26 Right, fine. He died in 1988 at the age of 58. His widow informed us of that? 27 A 28 504 Q 29 Yes . Yes . And that he sold it to Mainport Holdings; a Cork company? 1 2 505 Q 3 A 4 506 Q 5 A Yes. 6 507 Q Yes? 7 A 8 508 Q 9 1984 . 1984? Now, that was March. The 1st March. Was it sold directly to Mainport Holdings or was there an intermediatory stage? 10 A 11 509 Q 12 I think it was sold directly to Mainport Holdings. Yes . MS. MACKEY: 13 Just one thing struck me there, Mr. Turvey: 14 JUDGE O'LEARY: Yes. 15 MS. MACKEY: When you said you came in 16 March this letter 17 actually, going back to it for a second, was written 18 in January (Exhibit 22)? 19 A 20 The O'Reilly...(INTERJECTION). MS. MACKEY: 21 22 The O'Reilly letter as we call it. A Well, now I will have to check the records but to 23 my knowledge in whatever year I joined it was in 24 late February/early March. 25 something with Jackie O'Reilly stating that I was 26 accepting the job or whatever. 27 MS. MACKEY: 28 Because I had known him personally. 29 I may have signed Right. 1 2 3 4 MS. MACKEY: A. So, it could have been. So, I may have signed something for him stating 5 that, 6 some date in February or March. 7 MS. MACKEY: 8 A. 9 "Yes, I will start work on whatever date," But the letter in question that we are talking about with the Mary O'Reilly thing. 10 MS. MACKEY: 11 A. It amazes me. MS. MACKEY: 16 prior to joining his company? A. 18 A. A. So...(INTERJECTION). I would have to check the records in fact on that. MS. MACKEY: A. You did not at all? Never. MS. MACKEY: 22 23 No, no. MS. MACKEY: 20 21 Used you undertake any work for Mr. O'Reilly 15 19 Yes. Because I will know from Finnegan Menton records 24 if they are still there mind you; it is a long 25 time ago. 26 MS. MACKEY: 27 A. Yes? When I took up duties with Finnegan Menton. 28 29 That is the date on it any way. 14 17 That was written on the 12th January 1984. 12 13 Yes. useful. 1 2 510 Q 3 Yes. The takeover of the business was: His company was not bought out; is that not correct? 4 A 5 511 Q 6 A Yes, that is right. It is just that the business was transferred? They bought the business and they formed a new 7 company called O'Reilly Aerlod Ireland Limited 8 I think. 9 512 Q 10 11 Yes. Who were the directors of that? First of all were you an Officer of the Company? A 12 I am trying to think of when I was. When I went in in 1984 I was made Secretary of the Company. 13 513 Q 14 A Yes? When the deal was done and it was sold to Irish 15 Mainport Holdings I would have been Secretary only 16 and when Irish Mainport Holdings took over I think 17 I probably resigned as secretary or else I just 18 remained secretary. 19 514 Q 20 A 21 515 Q 22 23 I see? I wasn't a director to my knowledge at that stage. I see. Could you assist me in this regard: What or who was Lebac Limited? A Lebac Limited was a company that was formed at 24 a later stage. 25 The owners -- Jackie O'Reilly left the Company. 26 A man called Dermot Carpendale became Chairman 27 and Managing Director, who had been working with 28 the Company for years, and he and we, "we" being 29 two or three senior people in O'Reilly Aerlod, What happened subsequently was: 1 bought the Company back from Irish Mainport 2 Holdings. 3 516 Q 4 A 5 6 When was that? Have you the date that Irish Mainport Holdings first bought the Company? 517 Q Is that...(INTERJECTION)? What I have here is I have a return for the 31 7 December 1988 in respect of O'Reilly Aerlod Ireland 8 Limited? 9 A 10 518 Q Yes . You are the secretary and the shareholders at 11 the time of the 1987 Annual General Meeting included 12 Lebac; Oliver Hennessy, William Oliver Hennessy; 13 Daniel Anthony Kernan; Finbar John McGrath? 14 A 15 519 Q Yes? 16 A Yes. They were the shareholders; is that it? Well, they were all employees of the Company 17 as I was and Lebac as I recollect it -- the way 18 the thing was set-up finally was that Lebac held 19 the shares and we the six people, senior executives 20 in the Company, owned the shares in Lebac. 21 520 Q 22 A 23 521 Q 24 A I see? That was my recollection of it. I see, I see? My recollection was that the Hennessy, Cullinane 25 Carpendale, Cohen, Turvey; five and may be some one 26 else, six. 27 522 Q 28 A 29 523 Q Egan? No, that would be later. Later? 1 2 524 Q 3 A 4 525 Q 5 A I see? Yes. Egan and McGrath would have come later. I see? But I think there were 100 shares or something in 6 Lebac and between us we owned them and Lebac in turn 7 owned the share capital of O'Reilly Aerlod. 8 526 Q 9 10 All right. When did that transaction take place do you think? A I went there in 1984. Say about 1987 it was sold or 11 1986 maybe it was sold to Irish Mainport Holdings 12 and about a year later it was bought back; 1987. 13 would say around about 1987. 14 527 Q Around about 1987. You might wonder why 15 I am concerned about this Company at all really 16 which looks rather strange in some ways but 17 I wonder would you show Mr. Turvey two documents; 18 number 149 & 150 (Same Handed) 19 is at a later time. 20 Ireland Limited cease business? 21 A 22 528 Q 23 A 24 529 Q I (Exhibit 24). This When did O'Reilly Aerlod Some time after 1994. 1994? Some time after that. In 1991 a lodgement was made to an "Ansbacher" 25 account in respect of a cheque which had been made 26 out to O'Reilly Aerlod. 27 Ireland Limited now, just O'Reilly Aerlod. 28 will see the cheque there 29 Yes . It is not O'Reilly Aerlod (Exhibit 24) You (indicating)? 1 530 Q The problem is that O'Reilly Aerlod were gone out 2 of business and had ceased to exist at that stage 3 in 1991? 4 A 5 531 Q 6 A That is true. And it came from Boardman (Air Services) Ltd? I see that. Now, I have no knowledge of any 7 connection whatever between O'Reilly Aerlod, 8 anybody in O'Reilly Aerlod (Ireland) Limited, 9 and "Ansbacher" or monies coming from it. 10 532 Q 11 A 12 533 Q 13 This is a total surprise to me. I don't know who. Had you any familiarity, Mr. Turvey, with what happened at the wind-up of O'Reilly Aerlod? 14 A 15 534 Q 16 A 17 535 Q 18 19 Yes ? The wind-up: No, no. I left the Company. I am talking about O'Reilly Aerlod now? Oh,O'Reilly Aerlod. I am not talking about O'Reilly Aerlod (Ireland) Limited? A Yes, yes, sorry, sorry. I haven't, no. I don't 20 remember -- I don't recollect what happened at the 21 wind-up. 22 Holdings Limited didn't want to take it over. 23 536 Q 24 A 25 26 It was wound-up because Irish Mainport I understand that? Any potential liabilities that O'Reilly Aerlod might have had. 537 Q Were you familiar with the person who actually 27 carried out we will say the business of tidying 28 up Mr. O'Reilly's affairs when he died? 29 A 1 538 Q 2 A 3 539 Q 4 A 5 540 Q 6 I don't even know who tidied them up. You do not know who tidied them up? No. Would the name Michael O'Flaherty mean anything to you? 7 A 8 541 Q 9 A He was an AIB Operative? No. It means nothing to you? Our bankers were AIB at some stage; no, maybe it was 10 at a later stage but I don't remember a Michael 11 0'Flaherty. 12 542 Q 13 All right. Am I right in saying that Boardman (Air Services) Ltd were a company that the O'Reilly 14 Aerlod companies, one or the other, would have 15 done business with? 16 A Yes, yes. 17 543 Q Boardman? 18 A 19 544 Q 20 Boardman is the name. Yes . And they would have been paying, making payments to, O'Reilly Aerlod from time to time? 21 A 22 545 Q They would have been, yes, yes. Right. Is it not rather strange that in 1991 a 23 payment is made to O'Reilly Aerlod of £6,284.50 24 and it ends up in "Ansbacher"? 25 A It is but I never knew there was a connection with 26 "Ansbacher" but it wouldn't surprise me if in the 27 Jackie O'Reilly days -- no, it is 1991 you say. 28 546 Q 29 A No, this is ... (INTERJECTION) ? 1 547 Q 2 A 3 548 Q 4 A 5 549 Q 6 7 A He can be blamed for a lot of things? Yes . However, I think he was three years dead at this Yes, yes. You are right, yes. It does surprise me, Sir, yes. 550 Q 10 He was three years dead and considerably more than that out of the Company? 11 A 12 551 Q 13 14 Is dead. stage? 8 9 Is gone. Yes, yes. So, I do not think it is likely that it was his money? A Yes, that is quite true. I had forgotten that. 15 I don't know is the answer to why it would end up in 16 an "Ansbacher" account. 17 552 Q 18 19 Or any of the other people that you were involved with: A I have no idea. Do you think they had "Ansbacher" accounts? I would not have thought so, there is only one who 20 could have and I don't like saying it because I 21 don't want to be pointing a finger but there was 22 only one who would have had any money of that lot. 23 Of those names I gave you none of them had any 24 money. 25 553 Q 26 A I know. I understand? Disposable money like that except one and that was 27 a man called Dermot Carpendale. 28 he is the only one who could have had it in my view. 29 554 Q I understand. So, if anybody had During the course of the time that 1 you were dealing with Mr. McGonagle and Mr. Finnegan 2 and this is getting away from the O'Reilly situation 3 now? 4 Yes . 5 555 Q During that period of time did they ever encourage 6 you to establish a company or an account yourself in 7 "Ansbacher"? 8 A 9 556 Q 10 A 11 557 Q 12 A 13 558 Q An account myself in "Ansbacher"? Did you have an account yourself in "Ansbacher"? No, no, no. Did they pay you is any way in respect of that? No, no, no. You see your evidence in extremely helpful and 14 thank you very much indeed for it. 15 coming to the conclusion with regard to the evidence 16 but the one thing which is a bit strange now viewing 17 it as an outsider? 18 A 19 559 Q I am almost Yes . Is that Mr. McGonagle would have depended on you 20 so much down through the years without ever making 21 a payment to you? 22 A 23 Yes. Well, he never made a payment to me but I went away on holidays with him on the boat. 24 560 Q 25 A Yes, I know? And he would pay all the expenses of the boat, you know? 26 27 561 Q 28 A 29 562 Q I do. Yes? All the food and everything. Yes? 1 We sailed all over the place in later years and in 2 addition, 3 it here, apart from the small bequest in his Will he 4 made a provision for me from the trust in question. 5 563 Q 6 A 7 564 Q 8 A 9 I suppose there is no point in not saying Yes ? It amounts to quite a bit of money. Yes. So, in other words... I'll probably never see it but, you know, that is the way it is, you know? 10 565 Q 11 A Yes. In what way? Well, you see he always thought he would die young. 12 He used to say he would die before he was 40 or he 13 would die before he was 50 because of his family 14 history etc., and he always assumed that I would 15 outlive him and that certainly my wife, who was 16 14 years younger than me, would outlive him. 17 5 66 Q 18 A 19 20 So, he left a substantial slice of the funds that were in this trust to me and my wife. 567 Q 21 22 Yes ? Do you mind me asking was that done while it was in "Ansbacher" or was it done later? A It was done earlier. It was done -- when you say 23 "Ansbacher" I think of Guinness Mahon Cayman Trust 24 first, yes. 25 568 Q 26 A 27 5 69 Q 28 A 29 Use the same word? The same, right. Use the same word? I don't know. I started with him 1972. It was probably done some time in the late 1970's. 1 570 Q 2 A 3 571 Q 4 A 5 572 Q 6 A 7 May be early 1980's. Yes ? He told me he was making provision for me. Have you documentary evidence of that? I had it but I no longer have it. I had copies of the trust and a copy of a letter of wishes. 8 573 Q 9 A 10 Yes? And both of those I gave back to him or to his solicitors a long time ago now. 11 574 Q 12 A Yes ? But I know that I was included in that for 15%, 13 me and my wife for 15% between us, of the funds 14 in the trust. 15 575 Q 16 A Yes, presumably it is still there; is it? Yes, I assume it is. I ended up virtually 17 pensionless and that I regarded as my pension or 18 provision for my later days. 19 576 Q Yes, I understand? 20 A It is still there. I have no doubt it is still 21 there because nothing has been, nothing on that 22 trust has been, touched since his death. 23 MS. MACKEY: You mean that you were 24 made a beneficiary of the 25 26 trust? A Is that essentially what is meant? Well, it is not a beneficiary in the sense. The 27 way these trusts -- I am not an expert on trust Law. 28 MS. MACKEY: 29 But the Trust says the beneficiaries are the Queen Right. 82 1 and the Red Cross and the whatever and whatever; you 2 know the way these trusts are worded? 3 577 Q 4 A JUDGE O'LEARY: I do indeed. Yes? And then there was a Letter of Wishes rather like 5 that letter which you have produced there 6 (indicating) 7 578 Q 8 A 9 579 Q 10 A 11 (Exhibit 21). Yes? The John Finnegan one. Yes ? Stating that, "In the event of my death I wish the proceeds to be distributed as follows". 12 580 Q 13 A Yes ? And it was largely to his widow and then in fact -­ 14 now, that I think of it -- or did he? 15 say his wife, no, no. 16 He had lived with his present wife for some 20 years 17 before they finally got married. 18 581 Q 19 A No, he didn't It was largely to his widow. Yes ? And he had left the major portion of it to her and 20 15% to me and my wife by the wording of this letter 21 of wishes 22 582 Q 23 A 24 583 Q 25 A 26 584 Q 27 A 28 585 Q 29 A (Exhibit 21). I mean may be there is nothing there? Well, there is. There is? I know there is, yes. You know there is? There certainly is. Yes, I see. All right. But there may be nothing there at the end of all of 83 1 this if, you know, there are Revenue liabilities as 2 a result of that trust. 3 586 Q 4 A 5 587 Q 6 A 7 588 Q 8 A 9 10 11 A 12 589 Q 13 A 14 590 Q 15 A 16 That is a matter... Yes, yes. Obviously I do not know whether there are or not? Yes, yes. There might not be you see? Yes . MS. MACKEY: Yes. JUDGE O'LEARY: Yes. Yes . There might not be? Yes . I do not know? Yes . MS. MACKEY: 17 after that now, 18 19 Mr. Turvey? A 20 21 24 It's Credit Suisse in Guernsey. MS. MACKEY: A 22 23 Do you know who is looking 591 Q Credit Suisse in fact. Yes . MS. MACKEY: I see. JUDGE O'LEARY: Have you discussed this with the widow? 25 I never mentioned it to the widow because he had 26 never mentioned to either of his wives. 27 mentioned it to the widow until about three months 28 ago roughly when she started asking questions as a 29 result of what she had seen in the papers and the I never 1 fact that she had been asked to make a statement 2 to your predecessor here. 3 592 Q 4 A 5 593 Q 6 A Yes ? To Justice Costello. Yes ? What she read in the papers -- obviously there 7 was money abroad and she was aware of that and she 8 for a long time never mentioned it to me and we are 9 very close friends and eventually it cropped up and 10 I told her about it but i t 's within the last couple 11 of months, three/four months, may be, you know? 12 Up to that she didn't know, she had no idea. 13 594 Q 14 A Yes? And I simply said nothing because Liam had never said anything, you know? 15 16 I see, yes. 595 Q Absolutely, yes. 17 That is grand. 18 Mr. Turvey. 19 MS. MACKEY: Of course I understand that. I have no further questions for you, Have you any questions? 20 I will just may be ask a couple of questions about 21 Mr. Waldron. 22 JUDGE O'LEARY: 23 I will leave for that purpose then. 24 MS. MACKEY: Yes . 25 JUDGE O'LEARY: Other than that you have 26 27 28 29 no other questions? MS. MACKEY: No, I have no other questions. 1 do, Mr. Turvey, is I will 2 withdraw because I do not want to be involved in 3 any questions relating to Dr. Waldron? 4 Right. 5 597 Q 6 And that aspect of the matter will be dealt with by Ms. Mackey; do you understand? 7 A 8 598 Q 9 Fine, yes. You may know that there are actually four Inspectors but we divide up the work. 10 A 11 599 Q 12 A 13 600 Q 14 A 15 601 Q I see . Everybody cannot do everything? I know. I can well imagine. You will appreciate that? Yes . And that is it I think. So, I will just leave my 16 stuff here and I will come back later for it. 17 MS. MACKEY: 18 say another three minutes, 19 20 Mr. Turvey? A 21 Righto, Ms. Mackey. MS. MACKEY: 22 23 24 A Yes, thank you. JUDGE O'LEARY: Thank you very much. Thank you. 26 Thanks. 27 JUDGE O'LEARY: 29 And then we will be finished. 25 28 It will only take I would Thank you very much. 1 2 MS. MACKEY: 3 4 5 MS. MACKEY: It is really just a couple 6 of documents we have here 7 which refer to a connection between Mr. McGonagle 8 and Mr. Turvey in connection with the Cayman trust? 9 A 10 603 Q Yes And I just wanted you to may be clarify what that 11 was about so that I would be quite clear. 12 Ms. Cummins 13 now. 14 photocopy but we will try to decipher it (Same 15 Handed) 16 A 17 604 Q 18 it is page 126. I think, I will just make sure Yes, it is page 126 & 127. 126 is a very bad (Exhibit 25)? I will do the best I can. Thank you. May be I will read it out insofar as I can. It is an extremely bad photocopy? 19 A 20 605 Q Yes . However, it starts, its headed, as you can see: 21 22 "Guinness Mahon Cayman Trust Limited"? 23 24 A 25 60 6 Q 26 A 27 607 Q 28 A 29 608 Q I do, yes. It is coming from there and it is signed John Furze? Yes . Who you have mentioned already? Yes . It is dated the 1st November 1977 and it is 87 1 2 A. 3 609 Q. Yes. And then there is the reference: 4 5 "BRITISH ISLES INVESTMENTS LIMITED"? 6 7 A. 8 610 Q. Yes. He says: 9 10 "Dear Liam, on instructions from Dr. Waldron we placed a sale order on the holding of 1250 Bidger." 11 12 13 A. 14 611 Q. 15 A. 16 612 Q. Bridger Petroleum Shares I think that is. Great, excellent? And as you will see now. 17 18 19 "As you will see from the enclosed copy contract notes we were successful in disposing of..." 20 21 All but 50 of these shares I think, 22 23 24 "...all but 50 of these shares at the agreed limit price of Canadian dollars, 11.50 per share." 25 26 Whatever it is. 27 28 29 "We have placed a purchase order to buy 5,000 of Voyager Petroleum..." 1 2 3 Sorry, the first word wasn't Voyager. 4 Bridger. 5 613 Q 6 A 7 614 Q 8 A 9 615 Q 10 A 11 616 Q It was Bridger? Yes, . I thought it looked a bit different? Yes, yes, that is right. And then we come to the Voyager? Yes . 12 13 "We have placed a purchase order to buy 5,000 of Voyager Petroleum at a limited price of ten Canadian Dollars per share. Today, these shares were quoted at a price of 10 1/8 - 10 1/4..." 14 15 16 17 Is that it? 18 A 19 617 Q That is right. 20 21 22 "As soon as we have been able to fulfil all or any part of this order I will let you know." 23 24 Now, it is the next bit that is the relevant bit 25 really: 26 27 28 29 "In accordance with instructions from Dr. Waldron today we are arranging to sell the Sterling which we hold in Cayman for your account and will convert the proceeds to Dollars. I will let you have full details of 1 this contract once it has been executed and will also hold the Dollars here so that we can utilise them in the purchase of Voyager Petroleum Shares." 2 3 4 5 And then it is signed by John Furze. 6 I am interested in is the fact that this is headed 7 British Isles Investments, which you have explained 8 to us is Mr. McGonagle's trust or the Company under 9 it? 10 A 11 618 Q 12 13 Really what Yes . However, there Dr. Waldron appears to be giving instructions to Cayman in relation to it? A Yes. I vaguely remember this all right. I think 14 he was involved himself in a venture. 15 involved in several ventures over the years. 16 619 Q 17 A 18 He was Yes ? That he drew friends of his here into it and got them to invest in it. 19 620 Q 20 A Yes, right? And this was a case I think where he obviously got 21 Liam at some earlier stage to purchase these Bridger 22 Petroleum shares . 23 621 Q 24 A 25 Yes ? That is what I would think reading this (indicating). 26 622 Q 27 A 28 623 Q 29 A Yes, yes? Now he is now selling them. Yes? (Exhibit 25) 1 2 3 "In accordance with instructions from Dr. Waldron today we are arranging to sell the Sterling which we hold in Cayman for your account..." 4 5 6 7 A. 8 625 Q. 9 Yes, however, Mr. Turvey, Dr. Waldron appears to be giving instructions as to what is to be done with 10 11 But that is for Liam's account. Liam's account; is that not what it seems? A. Yes, but I think Liam may have told him to do that. 12 13 "In accordance with instructions from Dr. Waldron today we are arranging to sell the Sterling which we hold in Cayman..." 14 15 16 17 626 Q. 18 A. 19 627 Q. 20 A. Is Guinness Mahon Cayman Trust? Is Guinness Mahon Cayman. Yes? So, Oliver Waldron obviously told them to do this 21 and I assume Liam McGonagle told them it was all 22 right for him to do so. 23 628 Q. 24 A. 25 629 Q. 26 A. 27 630 Q. 28 29 Yes. It is just unusual? It is but... A third party would be giving instructions? Yes, but I think...(INTERJECTION). To one's banker if you like about what to do about one's own account? 1 complete I think you will find that Liam McGonagle 2 had given his consent to this. 3 631 Q. In fact I only have one other document but it 4 may help although it seems to be in relation 5 to something entirely different? 6 A. 7 632 Q. 8 A. Yes. 9 633 Q. Yes. 10 A. 11 634 Q. 12 Is that the next one you have given me? The next one? It is a later document (Exhibit 26)? 4th December. And it is from Dr. Waldron to Mr. Collery in Guinness & Mahon? 13 A. 14 635 Q. 15 A. Yes. Do you know Mr. Collery? I did, yes. 16 17 "I have been instructed by Mr. Desmond Turvey to forward the enclosed cheque for £1,000 to you for the joint account of Liam McGonagle and Dr. Oliver Waldron." 18 19 20 21 636 Q. 22 A. 23 Is the reference there to a joint account? Yes. Well, that that may answer the first one all right. 24 637 Q. 25 A. 26 Yes? That they may have opened a joint account between them for this venture. 27 638 Q. 28 A. 29 639 Q. However, you do not know; do you? I don't. Well? 1 A. What I recollect is that Ollie Waldron went into an 2 oil venture in Texas or somewhere that was going to 3 extract oil from shale. 4 640 Q. 5 A. 6 641 Q. 7 A. 8 642 Q. 9 A. 10 Yes? Shale being some kind of earth. Yes? A mixture of earth and whatever, you know? Yes? It was a more expensive way of extracting oil and he was looking for people to put money into it. 11 643 Q. 12 A. Yes? And what Liam McGonagle may have done is taken 13 X dollars or pounds or whatever out of his account 14 and put it into a joint account with Oliver Waldron. 15 644 Q. 16 A. 17 645 Q. 18 A. 19 646 Q. 20 A. 21 Rather than giving it to Oliver Waldron. Yes, I understand? Because he may not have trusted him entirely. Yes? Put it in a joint account with him to be used for the purpose. 22 647 Q. 23 A. 24 648 Q. 25 A. 26 649 Q. 27 A. 28 650 Q. 29 Yes? Yes. Well...(INTERJECTION)? This is conjecture. I know? Yes. And I do not want you to conjecture really? Yes. You are very good to be trying to help me out 1 2 651 Q 3 A 4 652 Q Yes . The one thing I wanted to know is were you aware of 5 any connection between Dr. Waldron and British Isles 6 Investments and the Cayman trust? 7 A 8 No, and there was no official connection. I have no doubt whatever about that. 9 653 Q 10 A Yes ? Now, what would be appear to me there is that 11 Liam got British Isles Investments -- got a 12 special account set up there. 13 654 Q 14 A 15 Yes? With he and Ollie Waldron jointly involved and the money went into that. 16 655 Q 17 A Yes ? But he certainly didn't have any ownership or equity 18 or any connection whatever with British Isles 19 itself. 20 65 6 Q 21 A 22 657 Q 23 A 24 658 Q Did you do any work on behalf of Dr. Waldron? No. You did not? No, no, no. Well, that is fine. I will not ask you any more 25 questions about that then. 26 Mr. Turvey? 27 A 28 65 9 Q 29 A Not at all. Thank you. We are finished? Thank you very much, 1 660 Q 2 A 3 And we have kept you a long time but thank you? Sorry, I have got this document here still (indicating) 4 661 Q 5 A 6 662 Q (Exhibit 27). We will get you copies? Yes . The only other thing that we should say before we 7 finish is that a transcript will in due course be 8 drawn up from the Stenographer's notes? 9 A 10 6 63 Q 11 A 12 664 Q I see, yes. A detailed contemporaneous taking down of the thing? Fine . And we will ask you to come in and sign it but 13 Ms. Cummins will be in touch with Mr. Daly about 14 that whenever that is ready? 15 A 16 6 65 Q 17 When it happens, yes. That is fine. And, you know, at your convenience then if you would sign it; read it of course and sign it? 18 A 19 666 Q 20 Yes . If you want a copy of it we unfortunately cannot give you a present of it? 21 A 22 667 Q Okay. It has to be bought from the Stenographer; at what 23 cost? 24 MS. CUMMINS: £60. 25 MS. MACKEY: For £60 I am afraid? 26 A 27 668 Q 28 29 Yes . However, we will certainly allow you to read it without having to purchase it? A 1 669 Q 2 A 3 670 Q 4 A 5 671 Q Right. Thank you very much, Mr. Turvey? Righto. Thank you. Thanks, Mr. Daly. 6 MR. DALY: Thank you. 7 MS. MACKEY: Ms. Cummins will sort out 8 those matters. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION THEN CONCLUDED. Thank you. 62976 Off/Ea .M Urn/Phi? E5) Ca. . (w 0/ K en n e d y M cG o nag le B allag h I n c o r p o r a t i n g B e l l B r a n i g a n O ’D o n n e l l & O ’ B r i e n s o l i c i t o r s 20 N O R T H U M B f i R L A N D R O A D DUBLIN 4 Ti :1.660 9799 l-'AX 660 9434 FMAIL: info@kmb.ie vvww.kmb.ic D X 75 Office of the Inspectors Appointed by Order O f the High Court to Ansbacher (Cayman) Ltd -ird T7i„__ 3 Floor Trident House Blackrock C o Dublin Y o u r ref: C / M 0 7 / N S P M O u r ref: M O ’S/DF 15 November 2001 Re: L i a m McGonagle deceased Dear Inspectors, Thank you for the opportunity to influence your preliminary conclusions concerning Mr. Liam McGonagle deceased. Apart from your unhappy use of the word “client” in your preliminary conclusion our client, given her husband’s untimely death, is not in a position to refute your conclusion but has a number of requests to make. W e suggest that the first paragraph reads:“Mr. Liam McGonagle was a well known Solicitor practising as one of the Partners in a Dublin legal firm. H e was also involved with others in property investment.” The rest of the paragraph which seems superfluous should be deleted. It is not correct to say that he was a property developer in his o w n right but while he did, to this writer’s knowledge, a single property development, it was in conjunction with others. O n the other hand, it is correct to say that he was involved in property investment, having a number of property investments generally with others. There is a clear distinction between a property developer and a property investor. Third parties reading your report might conclude that Camille Investments Limited was a foreign registered company. In fact it was not, it was registered in Ireland as an investment company. W e therefore suggest adding the words “an Irish registered company” after the word “was” on the first line of paragraph 4. M I U i A i - . l . J. O ' S H K A R ( X i h R \\ H A L L . M i l l I L R L N C L L. D I X O N M A IN C. H A R R Y G O R D O N .I LI Xi l. a s s is ta n ts : i- i o n a i i i - n r y a o a ' i i i a u. i a y l o r C O N S l L I A N T S : L A I R L N C L I. I M . W K i A N M A R I I N A I.. ( M i O R M A N C O M M I S S I O N E R S I OR O A T I IS / N O I A R I L S 1*1 HI .1C The last line of the fifth paragraph states that British Isles Trust was “a trust whose beneficial owner was Mr. McGonagle”. Surely it would be more correct to say that it is “a trust associated with Mr. McGonagle.” W e do not consider that there is evidence before you to say that he was the sole beneficial owner of this trust. A n y number of people m a y have had an interest in the ownership of this trust, such as, his first wife, the late Evelyn McGonagle. Y o u also refer to the late Mr. McGonagle having an involvement with Kinsale Yacht Charters Limited and Beresford Investments Limited. While w e cannot say with certainty, in relation to Kinsale Yacht Charters Limited, w e are aware that Beresford Investments Limited was an Irish company and that Mr. McGonagle’s involvement was with others. W e therefore suggest adding the word “(either on his o w n or with others)” after the word “involvement” on the first line of this paragraph. The term “client” has several meanings but your use of this term in your conclusion does not seem correct. In the context of a relationship between a party and professional person where that person is using the services of the professional person the term “client” is understood. It, however, can also mean customer. There is no evidence to suggest any professional advice in this case and the use of the word “customer” seems to us a more appropriate term. The use of the term “client” in the language of the High Court Orders does not in our view justify your continued use of that term in your conclusion. Indeed there is no evidence that the deceased had any direct relationship with Guinness M a h o n Cayman Trust and the evidence available suggests that the relationship was in fact with Guinness M a h o n in Dublin. Yours faithfully, Kennedy McCtotfagle Ballagh 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Sean McKeon. a) Transcript o f evidence o f Mr Sean McKeon dated 16 May 2000. b) Unsworn statement o f Mr Sean McKeon dated 11 May 2000. c) Letter o f 7 January 1994 - Sean McKeon to IIB. d) Letter o f 17 June 1993 —Cayman International Bank & Trust Co Limited to IIB. Correspondence received from or on behalf o f Mr Sean McKeon. a) Letter o f 23 January 2002 - LK Shields Solicitors to the Inspectors. PRIVATE EXAMINATION OF MR. SEAN McKEON UNDER OATH ON TUESDAY, 16TH MAY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY BL Interviewee: MR. SEAN McKEON Represented by: MR. LAWRENCE SHIELDS LK SHIELDS 42 UPPER MOUNT STREET DUBLIN 2 WITNESS EXAMINATION MR. S. McKEON MR. JUSTICE COSTELLO PAGE 6 - 33 MS. MACKEY 34 - 38 MR. ROWAN 39 - 45 MR. JUSTICE COSTELLO 46 - 48 1 2 3 4 MR. JUSTICE COSTELLO: Good morning Mr. McKeon. 5 MR. McKEON: Morning. 6 MR. JUSTICE COSTELLO: My name is Declan Costello and on my right is 7 8 Ms. Mackey and on my left is Mr. Rowan. 9 we have been appointed Inspectors. As you know 10 MR. McKEON: Yes . 11 MR. JUSTICE COSTELLO: By The High Court. 12 MR. McKEON: Yes . 13 MR. JUSTICE COSTELLO: I that this is not a Court. 14 15 It is not a Tribunal. It is an interview. 16 MR. McKEON: Yes. 17 MR. JUSTICE COSTELLO: We are going to ask you questions. 18 19 MR. McKEON: Fine. 20 MR. JUSTICE COSTELLO: In accordance with the 21 requirement that has been 22 imposed on us by the Court. 23 MR. McKEON: Yes. 24 MR. JUSTICE COSTELLO: If in the course of the interview you would like 25 26 to consult your solicitor at any time please tell us 27 so . 28 MR. McKEON: Yes, right. 29 MR. JUSTICE COSTELLO: And we will stop asking explain to witnesses 1 2 3 Yes . MR. JUSTICE COSTELLO: 4 Similarly, your solicitor can at any time, if he 5 wishes to, ask us to stop for a while if he wants to 6 consult with you. 7 MR. McKEON: Yes . 8 MR. JUSTICE COSTELLO: You are both free to 9 consult during the course 10 of the interview. 11 MR. McKEON: Thank you very much 12 MR. JUSTICE COSTELLO: This interview Mr. McKeon 13 will be held under oath, 14 You are asked to give your evidence under oath and I 15 will ask Ms. Mackey to administer the oath to you. 16 MR. McKEON: 17 18 19 20 21 22 23 24 25 26 27 28 29 Fine . 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. McKeon, we obtained a statement from you with 6 your solicitor's letter of the 11th May. 7 if you have it before you there (Exhibit 1)? 8 A. 9 2 Q. 10 A. 11 3 Q. 12 A. 13 4 Q. Yes, I have it, yes. We might go through it? Yes. And I might ask you some questions on it? Yes. You refer in the second paragraph to your former 14 business partner Mr. Kennedy. 15 partnership cease, do you remember? 16 A. Perhaps, When did the The partnership ceased in 19 -- well, we had a 17 de-merger it started in 1996 and probably went on 18 for...(INTERJECTION). 19 5 Q. 1996? 20 A. Yes. 21 6 Q. Yes? 22 A. 23 And went on for probably a couple of years by the time it was all finished. 24 7 Q. 25 A. 26 8 Q. 27 Yes? Wound up. Yes. The main company with which you were both involved was Sheelin Homes Limited? 28 A. 29 9 Q. Yes. You say in your statement that you recall a 1 2 3 10 Q. 4 Between John Kennedy and Mr. Maurice O'Kelly and yourself? 5 A. 6 11 Q. 7 Yes. Had you had dealings with Guinness & Mahon over the years ? 8 A. 9 12 Q. 10 A. No. Had you met Mr. Maurice O'Kelly before? Yes. I would have met Mr. Maurice O'Kelly with 11 John Kennedy because he lived -- Maurice O'Kelly was 12 a near neighbour of John Kennedy's. 13 13 Q. 14 A. 15 Yes? And I would have met him, you know, over the years but only socially. 16 14 Q. 17 A. Socially? Yes, and maybe he was a very good golfer and 18 occasionally he would maybe invite us out for a game 19 of golf. 20 15 Q. 21 A. 22 16 Q. 23 Yes? But socially. You did not have any professional dealing with him until this conversation that you are talking about? 24 A. 25 17 Q. No. Did any of your companies, did Sheelin Homes 26 Limited, have any professional relationship with 27 Guinness & Mahon? 28 A. 29 18 Q. No. Do you know had Mr. Kennedy before this? 1 2 19 Q. 3 A. 4 20 Q. 5 A. 6 21 Q. 7 A. You did not know? No. He never referred it to you, the fact to you? Absolutely never did. Never did? We never had any -- in the early 1980's, just let me 8 think for a second? 9 just recall now that we bought a site from We actually bought a site. 10 Guinness & Mahon. 11 was actually purchased from Guinness & Mahon. 12 22 Q. 13 A. 14 23 Q. 15 A. I One of the sites we developed However, you...(INTERJECTION)? I just recall that. However, you...(INTERJECTION)? I only recall that now just when you asked the question. 16 17 24 Q. 18 A. 19 25 Q. 20 A. 21 26 Q. 22 A. 23 27 Q. 24 A. 25 28 Q. 26 A. 27 29 Q. However, you never had any business? No. You yourself? No, no. Or your company? No. As far as you know Mr. Kennedy had not any? No, no. Correct. Relationship, business relationship, with them? No. Could you just tell me about this conversation that 28 came about in the early 1980's? 29 Mr. O'Kelly's office in Guinness & Mahon, do you Was it in 1 2 No, I have been trying to memorise as to where the 3 conversation took place and to the best of my 4 knowledge it took place having a cup of coffee 5 somewhere. 6 having a cup of coffee and in the course of the 7 conversation this was mentioned. 8 30 Q 9 a 10 Just the three of us having met, and Yes? That is it. It wasn't any formal meeting that took place. 11 31 Q 12 A 13 Yes? This was just an informal kind of conversation which we were having when this arose. 14 32 Q 15 A 16 33 Q Yes? That is the best of my knowledge. Yes. You say in the third paragraph that 17 Mr. O'Kelly informed you that the investment would 18 be set up in the form of a trust. 19 first conversation or was this later, when you 20 decided to take the matter a bit further? 21 A 22 Was this in the My recollection would be that it was; it may have been discussed at the first conversation. 23 34 Q 24 A 25 35 Q 26 A Yes? I honestly cannot recall. Yes? If it was the first conversation but it was really 27 -- there was a mechanism for putting, you know, 28 money away for a rainy day. 29 36 Q Yes? 1 2 37 Q 3 A 4 38 Q Yes? So...(INTERJECTION). Was the tax aspect of this referred to at all? 5 Would you have to pay tax on the money that you put 6 away? 7 A No. There may have been some mention about that it 8 was money that you could put away and, you know, it 9 may or it may not be returned to the Revenue. 10 11 just honestly can't fully recall. 39 Q Yes. In any event it was some time before you 12 took the matter further and decided to approach 13 Mr. O'Kelly formally about the matter? 14 I A Yes, because I am sure there were some subsequent 15 conversations and as that another conversations 16 would have taken place. 17 40 Q 18 A Yes ? It was explained that effectively you were giving 19 control of your money to somebody else and if they 20 ran away with it, well that was hard luck. 21 suppose that does take a little bit of time to think 22 about. 23 41 Q 24 A So, I Yes? And secondly we were a small team in Sheelin and we 25 were very much up to our tonsils in the everyday 26 wor k. 27 42 Q 28 A 29 Yes? So, this was something that was mentioned. We would have forgotten about it and it was raised again. 1 43 Q. 2 A. 3 44 Q. 4 A. 6 45 Q. 7 A. 8 46 Q. 9 A. 10 47 Q. 11 A. 12 14 Yes. I take it that you discussed this with your Yes. Because both of you set up trusts, did you not? Yes, indeed. You both would have -- it was not independently? No. You both decided to do this? As with most decisions we would have taken around that time it would have been taken jointly. 48 Q . Yes? A. 15 And we would have taken them together and agreed to do things. 16 49 Q. 17 A. 18 Did you go then to Guinness & Mahon's office? Yes. My recollection would be that we went to Guinness & Mahon's office. 19 50 Q. 20 A. 21 Yes? And we met Mr. Des Traynor, the late Mr. Des Traynor. 22 51 Q. 23 A. 24 52 Q. 25 26 That is really the way it was. partner Mr. Kennedy? 5 13 Yes? Yes. Was that the first time you had met him? Yes, to the best of my knowledge, yes. Did he explain in any more detail then what was involved? A. I honestly do not recall but I would surprised if he 27 wouldn't have gone through the same, you know -­ 28 telling us similar to what Mr. O'Kelly would have 29 mentioned to us, and I would say in more detail. 1 53 Q 2 a 3 Mr. Furze, was probably referred to. 4 just an unusual name and that is how I would have 5 remembered it. 6 54 Q 7 I mean it was Had you come across the concept of a discretionary trust before? 8 A 9 55 Q 10 A No. Was this explained to you then? It probably was explained to me at the time. I mean 11 I am not a financial person. 12 background and, you know, finance would have been -­ 13 I would have known something about it but, you know, 14 in relation to trusts and discretionary trusts I 15 honestly would not have been. .. (INTERJECTION) . 16 56 Q 17 A 18 57 Q Trade is my No, I am sure not? Yes . However, I am just wondering was it explained to you by Mr. Traynor, can you recall? 19 20 A 21 58 Q 22 A I honestly can't recall. Yes ? It would have been explained to me. I would have 23 been more possibly focused in on the fact that one 24 was giving, whatever money you were giving, to 25 somebody else to look after it and if they decided 26 to go off with it, you know, that was it. 27 59 Q 28 A 29 Yes? That was probably more in my focus of attention than...(INTERJECTION). 1 60 Q. 2 the time? 3 A. 4 61 Q. 5 A. 6 62 Q. 7 No. Or from your own accountant? No. You were depending entirely then on Mr. Traynor and Mr. O'Kelly and Guinness & Mahon generally? 8 A. 9 63 Q. 10 11 Did you take legal advice from your own solicitor at Absolutely, yes. Yes. You say you signed certain documents, probably in 1986. A. What makes you think it was 1986? Because when I discussed this with my accountant, 12 Mr. Delaney, he informed me that it was -- that it 13 might have been in the calculations that were done 14 for the amnesty. 15 would have had, just some working papers he would 16 have, and that is where the date of 1986 came from. 17 64 Q. 18 A. 19 Yes? Other than that I wouldn't have been able to recall it. 20 65 Q. 21 A. He looked at some papers that he I wouldn't have known when I signed it. Did you ever obtain the Trust Deed? It may have been part of the papers. It may have 22 been part of the papers that we got at the time. 23 honestly just don't recall because once the amnesty 24 was closed off we just destroyed everything. 25 was just no point in having them. 26 66 Q. 27 A. 28 67 Q. 29 A. You may have got it? I may have got the Trust Deed. You have not got it now, is that the position? I have absolutely no papers whatsoever. I There 1 68 Q. 2 Would you write to the company in the Cayman to ask them for a copy of the Trust Deed? 3 A. 4 69 Q. 5 A. 6 70 Q. 7 A. 8 71 Q. 9 A. 10 72 Q. Yes? 11 A. Yes. 12 73 Q. 13 Would you write? Yes. Would you be prepared to write to them? Yes, yes. And ask them for a copy of it? Yes, I would. Because it would be relevant for our investigation to obtain a copy of the Trust Deed? 14 A. 15 74 Q. 16 Yes, yes. We would be grateful if you would write and ask for it? 17 A. 18 75 Q. 19 I have no problem. And also for the Letter Of Wishes? You recall that a Letter Of Wishes was signed? 20 A. 21 76 Q. 22 23 Pardon me? Yes, yes. Do you recall being told what the Letter Of Wishes was ? A. I do. My recollection of that would be that if 24 myself or myself and my wife were killed or, you 25 know, or something happened, that at least there 26 would be some piece of paper there that would say 27 who else should...(INTERJECTION). 28 77 Q. 29 A. Should benefit? Correct, yes. 1 78 Q 2 A 3 79 Q 4 A 5 6 Yes ? Or who should give the authority or should tell the people what to do. 80 Q 7 8 That is right. Then you transferred funds to Guinness & Mahon here in Dublin, is that right? A 9 Yes. The money would have been in a bank account in Dublin and it would have been just transferred to 10 Guinness & Mahon. 11 81 Q 12 A Here in Dublin. 13 82 Q Here in Dublin? 14 A 15 83 Q 16 A 17 84 Q Here? And...(INTERJECTION). Yes? Then whatever channel it went through after that. Do you remember sending it on to Mr. Traynor 18 personally or to Mr. O'Kelly or Mr. Collery? 19 you remember who you sent it on to? 20 A 21 85 Q 22 A 23 86 Q 24 A 25 Can More than likely it was to Mr. Traynor. Yes ? Or Mr. Collery. Yes? Because they I think were the people...(INTERJECTION). 26 87 Q 27 A 28 88 Q 29 A You transferred money to them? Yes . This was the initial transfer of funds to the Trust? Yes . 1 89 Q. 2 Can you recall did you over the years, between 1986 and 1993, trans f e r other funds, Mr. McKeon? 3 A. 4 90 Q. 5 A. 6 I don't recall transferring. Yes? I don't recall t r ansferring funds, other funds, in that p e r i o d of time. 7 91 Q. 8 A. 9 Yes. How did you learn about Tara Securities? It was the name that was on the piece of paper or on the d o c u m e n t a t i o n that we signed. 10 given. 11 92 Q. 12 A. 13 It was just I m e a n I had no say or n o . . . (INTE R J E C T I O N ) . Yes? In r e l ation to a name, I wasn't c o nsulted about a name. 14 93 Q. 15 A. 16 94 Q. 17 A. 18 95 Q. 19 A. 20 96 Q. 21 Yes? Or asked about a name. Yes? It was just this thing arrived. Yes? A n d said your Trust i s . . . ( I N T E RJECTION). Yes. Your impression is that the name of the Trust was Tara Securities? 22 A. 23 97 Q. Yes. You do not know for example that the Trust Deed may 24 have app o i n t e d the Guinness Mahon Cayman Trust 25 c omp a n y as Trustees and this m a y be a holding 26 c omp a n y under it. 27 A. 28 98 Q. 29 A. You do not know that? H o n e s t l y I don't know that. You do not know that? I wouldn't have known the mechanism. I wouldn't 1 2 Yes. 3 the statements that were given to you from time to 4 time, and how you learned about where your mon e y 5 was, and what interest it was earning, 6 development of your Trust? 7 A Can you give me some detail Mr. McKeon about and the In m y statement is what is m y clear recollection of 8 what we got at the time and that was pieces of paper 9 with just a h a n d w ritten note on the top. 10 100 Q 11 A Yes ? A n d it always kind of appeared to me that if 12 so m ebody p i c k e d it up they wouldn't kind of know 13 what it w a s . 14 101 Q 15 A They w o u l d not know? Because it just l iterally had h a n dwritten note on 16 the top and then it would have shown currencies, 17 funds in different currencies, and it was never 18 clear just what return one was getting on the money. 19 102 Q 20 A 21 A n d at the end of it there would have been a manag e m e n t c h a r g e . 22 103 Q 23 A 24 104 Q 25 A 26 105 Q 27 A 28 29 It s h o w e d . . . ( I N T ERJECTION)? It showed the amount, did it? It did. In each deposit? It did, indeed, yes. It showed the interest that was earning? I don't think it ever showed the rate of interest. It w o u l d have s h o w n . . . ( I N T E RJECTION). 106 Q A sum for interest? 1 2 107 Q 3 A 4 108 Q 5 A 6 109 Q 7 That is correct, yes. A n d a m a n a g e m e n t fee as well? Yes. Yes, indeed, yes. Was the whole document handwritten, do you remember, or was it just the top of it? 8 A 9 110 Q 10 A 11 111 Q M y r e c o l l e c t i o n is that it was only the top of it. A n d . . . ( I N T ERJECTION)? The rest of it was typed. The rest was typed. Was the rest of it the sort of 12 document that you would expect to obtain from a 13 bank? 14 of account that w ou l d have been p r e p a r e d by a bank? 15 A Was it like a bank statement or in some form It r eally was a simple sheet with just -- it would 16 have stated the different currencies, 17 amounts that were in it and it just showed maybe the 18 date on it and then another date. 19 what the gain was from one date to the other. 20 112 Q 21 A 22 and the So, one would see Yes? But I don't think it was really like a bank statement as such, you know. 23 113 Q 24 A Yes? I m e a n there is a sheet there but that sheet that I 25 got, that is one of the sheets which came from 26 Mr. Delaney, that was really at the end. 27 114 Q 28 A 29 Yes? W h e n he l o oked for it and I think that was more, don't ever recall getting anything as formal as I 1 that. 2 115 Q 3 A Yes? I never c e r t a i n l y recall Tara Securities across the 4 top of it. 5 top sheet was always torn off. 6 so m ebody just put down a ruler and just did that and 7 Tara wou l d have been written in by hand. 8 116 Q 9 A 10 117 Q 11 A 12 118 Q 13 A It w o uld have been just something. The It was evident that Yes? But I don't recall a sheet being as formal as that. Yes ? Or as n e a t l y set out as that. Yes ? A n d I think that might have just been at the end of 14 day w h e n this thing was being w r a pped up, that it 15 came in this form. 16 119 Q Perhaps, then you would give me some more evidence 17 about the decis i o n that you took in relation to the 18 1993 Act, the w a iver of Certain Taxes Act? 19 it come about that you d e c ided that this Act applied 20 to you, and that there was tax due, and that you 21 wo u l d have to p a y the tax due under the Act? 22 I recall when it was a n n ounced about the amnesty. 23 thought about it and I p e r s o n a l l y wa n t e d to avail of 24 the amnesty, 25 I never felt c o m fortable about it and that somebody 26 else, you know, had control of what I had earned 27 hard, money, 28 p r e p a r e d to r egularise this and regularise all my 29 affairs and that is what I wanted to do. I w a nted to. and so on. How did I Despite I had this trust, So, I was definitely 1 120 Q 2 A And, you know, just whatever we had to pay to the 3 Revenue I was p e r f e c t l y prep a r e d to do this, to 4 regularise it, and get everything on a footing. 5 121 Q 6 a Yes? That I was b a c k in control with whatever I had. 7 W h a t e v e r I was left with, at least I was in control 8 myself. 9 122 Q There were two aspects of it Mr. McKeon. 10 your lack of control, 11 got control. 12 a 13 123 Q One was your feeling that you had not The second was your liability for tax? Yes . Under the 1993 Act the p r o vision was that a person who should have p aid tax and you had not p a i d t a x . .. 14 15 a 16 124 Q 17 a 18 125 Q Yes . ... was then r e q uired to make certain payments? Absolutely, yes, that is correct. It does appear then that you came to the conclusion that you s hould have p a i d tax and had not paid tax? 19 20 a 21 126 Q 22 a Yes, I think that would be correct. Who advi s e d you about that? I don't recall taking advice. I recall making up my 23 own m i n d that I w anted to regularise my affairs 24 bec a u s e it was part of the amnesty. 25 127 Q 26 R e g u l a r i s i n g your affairs included pa y i n g tax that was due that should have been paid? 27 a 28 128 Q 29 a Yes . Did you go to Mr. Traynor about this? I think I only went to Mr. Traynor when the decision 20 1 was taken that we were going to avail of the tax 2 amn e s t y and to tell hi m that we wanted to close out, 3 close off, the Trust; take back all the money; pay 4 the tax that was due on the money. 5 129 Q 6 A What was Mr. Traynor's attitude? M y recoll e c t i o n would be that I think he, at the 7 start, wou l d have felt that it was maybe not the 8 right decision. 9 130 Q 10 A 11 131 Q 12 A 13 132 Q 14 A 15 133 Q 16 A 17 Yes? To take. Yes? I recall that I had my m i n d made up. Yes ? That is what I was going to do. Yes? A n d I think no m a tter what he said wasn't going to change m y mind. 18 134 Q 19 A 20 Yes? Because I had made up m y mind, this is what I wanted to do and that is w h a t . . . ( I N T E RJECTION). 21 135 Q 22 A 23 136 Q 24 A 25 137 Q 26 A Yes ? A n d I w a s ... (INTERJECTION) . Did he try to dissuade you then from doing it? Well, it might be a strong word to use, you know. Yes? May b e the w o r d -- and, you know, I have to think 27 b a c k to somebody who is, you know, not on this earth 28 any more but may b e to say that, you know, he didn't 29 feel that it was n e cessary to do that or whatever 1 2 138 Q 3 A 4 Yes? May b e words like that rather than dissuade me b u t . . . ( I N T E R J E C T I ON). 5 139 Q 6 A You said you indi cated that you wanted to go ahead? I had a b s o l u t e l y no doubt about that. I am very 7 clear on that, that I had made up my mind. 8 to do t h i s . 9 140 Q I wanted Had you rea c h e d that conclusion without the benefit 10 of p r o f e s s i o n a l advice? 11 your solicitor about the 1993 Bill when it was 12 circulated? 13 A 14 No, d e f i n i t e l y not our solicitor. We would have not discussed. 15 141 Q 16 A 17 142 Q 18 A 19 Yes? A n y of those financial dealings with him. Yes. What about Mr. Delaney then? May b e with Mr. Delaney because he was both the comp a n y accountant and my own personal accountant. 20 143 Q 21 A 22 144 Q 23 A 24 145 Q 25 26 Did you take advice from Personal accountant? A n d may b e with him. Yes? Indeed. Did Mr. Delaney know that you had a Trust in the C ayman Islands? A I w o u l d doubt it. I don't think he did until -- he 27 wo u l d not have known it until such time as we told 28 h i m that we w a n t e d to avail of the amnesty. 29 146 Q About the 1993 Act? 1 2 147 Q 3 A 4 148 Q 5 A Yes? He wouldn't have known that. He adv i s e d you then? I h o n e s t l y cannot say that, that he advised me to 6 avail of i t . 7 say. 8 149 Q 9 A 10 150 Q 11 A I am sure he did but I hone s t l y cannot Yes? I cannot say w i t h certainty. Yes. Whe t h e r ... ( INTERJECTION)? But I think h a ving discussed it with -- I think 12 John Ken n e d y and myself w o uld have d i s cussed it and, 13 you know, 14 what we were going to do. 15 in f ormed the various ne c e s s a r y people so as to get 16 this thing in motion. 17 151 Q 18 A 19 152 Q 21 A 22 153 Q 23 Yes ? A n d to do it. Yes. Mr. Del a n e y then h a n dled the ma t t e r for you Yes . He n e g o t i a t e d with the Revenue and contacted the Revenue about it? A 25 No. MR. SHIELDS: 26 No, there was no negotiation. 27 A 28 154 Q 29 Then we w o uld have from then on? 20 24 I think we had made up our minds that is There was no negotiation, no. MR. JUSTICE COSTELLO: Sorry. I am sorry. not trying I was 1 2 No, no, not at all. 3 155 Q 4 A 5 156 Q It is all right. I was not t r ying to catch you? No, no. Not at all. No, no. S o m ebody had to contact the Revenue. 6 on your behalf? 7 MR. SHIELDS: No, sorry, 8 Did he do that it does not work like that. 9 not w o r k like that. It did You assess -- you have to 10 arrive at an assessment. 11 MR. JUSTICE COSTELLO: 12 I unders t a n d that Mr. Shields. 13 MR. SHIELDS: 14 A 15 157 Q Yes. Yes. No, there was no c o n t a c t . . . ( I N T E RJECTION). MR. JUSTICE COSTELLO: Mr. McKeon, can I just explain? 16 17 A 18 158 Q 19 A 20 159 Q 21 A 22 160 Q 23 A 24 161 Q Yes . We have had all sorts of different evidence? Yes, I appreciate that. Before us? I appreciate t h a t . I just want to u n derstand what happened? Yes, of course. Did you yourself write to the Revenue and say "Here 25 is the form of self assessment," or did Mr. Delaney 26 write on your behalf? 27 A M y r e c o l l e c t i o n w ou l d be that there w o uld -- we 28 w o u l d have h ad a number of meetings with Mr. Delaney 29 in cal c u l a t i n g the tax. 1 162 Q. 2 A. 3 Yes? In cal c u l a t i n g the tax that was due and he would have done all of the computations. 4 163 Q. 5 A. Yes? A n d we told h im about whatever accounts that we 6 wou l d have h ad or that, and it was all -- all of 7 those calculations would have been done over a 8 p e r i o d of time. 9 164 Q. By him? 10 A. By him. 11 165 Q. 12 A. 13 166 Q. 14 A. 15 167 Q. 16 A. 17 Yes? From the info r m a t ion we w o uld have given to him. S o m ebody had to send the forms that were required? Yes, indeed. Who? Mr. Dela n e y wou l d have done it. Mr. D e l a n e y . . . ( I N T E RJECTION). 18 168 Q. 19 A. 20 That is what I w a nted to know? Yes. Sorry, Mr. Delaney wou l d have done that. We wo u l d have s igned up all t h e . . . (INTE R J E C T I O N ) . 21 169 Q. 22 A. Given him the information? S igned up all the documentation. He did all the 23 calculations and he w o uld have told us the amount of 24 m o n e y that we owed, that we w e r e . . . (INTER J E C T I O N ) . 25 170 Q. 26 A. Yes? That we owed to the Revenue and that is why at the 27 end -- and I don't recall ever signing that piece of 28 pap e r that we got from, the solicitor, Mr. Kennedy's 29 solicitor. I don't ever recall signing the piece of 1 paper, 2 Williams. 3 171 Q 4 A 5 172 Q 6 A 7 173 Q 8 A 9 going b a c k authorising I think it was Joan The payments? To collect the payments. Yes? The c h e q u e s . Yes ? A n d it was only r ecently when I saw it that I r e c a l l e d that they ma y have came through that bank. 10 I don't ever remember being in the bank because we 11 never had any dealings with them. 12 174 Q 13 A Yes ? But the piece of paper for the m o ney to be made out 14 to the Revenue Commissioners, 15 made to the Revenue Commissioners. 16 175 Q 17 A 18 176 Q 19 Yes? To p a y the tax. I u n d e r s t a n d then that you had a consultation with Mr. Delaney. 20 A 21 177 Q 22 A 23 178 Q 24 A 25 179 Q 26 A 27 180 Q 28 A 29 181 Q all the cheques to be As a result he computed the tax? Yes, he did. That you s hould pay? Yes . He then sent on the form that you had signed? Yes . On your b ehalf to the Revenue? Yes, indeed. We have this letter that you have referred to? Yes . This was a letter which authorised the bank to make 1 2 3 Yes, indeed. 182 Q Yes. It is signed by you. 4 Mr. Ronan Redmond. 5 (Exhibit 2)? 6 A It is to It is page 102 (Same Handed) I have it here. 7 MR. SHIELDS: He has a copy. 8 MS. MACKEY: Sorry, you have it. 9 MR. SHIELDS: He has it. 10 I was w o n dering what you 11 were doing. 12 183 Q 13 A 14 184 Q 15 MR. JUSTICE COSTELLO: I have it. You have it? Thank you very much, yes. Just the address "42 F i tzwilliam Square", what is that address Mr. McKeon? 16 A 17 185 Q 18 A That is where Mr. Traynor was at the time. Yes ? I m e a n when we w o uld have went to Mr. Traynor a b o u t . . . (INTERJECTION). 19 20 186 Q 21 A 22 Yes? About telling h im that we were going to avail of the amnesty. 23 187 Q 24 A 25 Yes. However, it l o o k s ...(I N T E R J E C T I O N )? At that time he was up in F i t zwilliam Square to the best of m y knowledge. 26 188 Q 27 A 28 189 Q 29 I am sorry. Yes ? M y r e c o l l e c t i o n is that that is where we met him. It looks as if this letter then must have been w r i t t e n on his note paper. It is not your address? 1 2 190 Q 3 A 4 191 Q 5 A 6 192 Q 7 Yes? No. Yes? No, no. So m ebody must have prepa r e d this then for you to sign and you signed it? 8 A 9 193 Q 10 A 11 194 Q 12 A Yes, indeed. Yes, indeed. A n d it is sent from his address? Yes, that i s ...(I N T E R J E C T I O N ) . Yes? That is cle a r l y the top of the sheet. Now, whether 13 it h ad anything else on the top of the sheet over 14 that I h o n e s t l y don't know. 15 195 Q 16 A 17 196 Q You do not know? I don't know. Mr. Redm o n d was asked then to make the cheques 18 a v ailable for collection by Joan Williams. 19 Joan W i l liams I take it? 20 A 21 197 Q 22 A 23 198 Q 24 A 25 Pardon? You knew Joan W illiams? I h ad met her. Yes? On the occasions when we wou l d go in to meet Des Traynor. 26 199 Q 27 A 28 200 Q 29 You knew Yes ? We w o u l d have met her. Yes. Mr. McKeon, there was evidence given in the M o r i a r t y Tribunal by an official from the Bank of 1 Ireland about the movement of funds from IIB to the 2 Bank of Ireland; 3 Isle of Man; from the Isle of Man to London. 4 you see this? 5 Securities. 6 No. 7 201 Q 8 A 9 202 Q from the Bank of Ireland to the It was about your affairs, Did about Tara Did you see this evidence? You have not seen it? No. Have you any knowledge yourself of how Mr. Traynor 10 m o v e d these funds that were yours and were mov e d 11 from IIB to the Bank of Ireland; from the Bank of 12 Ireland to the Isle of Man; 13 London? 14 A 15 203 Q 16 A Have you any knowledge of that? No. Did he tell you a nything about that? No, but, you know, we just lodged them and we knew 17 that they went abroad. 18 to get abroad, 19 204 Q 20 A 21 205 Q 22 A 23 206 Q 24 A 25 26 from the Isle of Man to So, in what route they took I didn't know what route. Yes? They took. Yes? Once we l o dged them. Yes? Because I m e a n when the statement wou l d come in they were in different currencies, 207 Q i n . . . (INTER J E C T I O N ) . I am not r e f e r r i n g to that really, Mr. McKeon. What 27 I am r e ferring to are the movements of your funds 28 from June 1993? 29 A 1 208 Q. In a very circuitous route, in the way in which it 2 has been given in detailed evidence, 3 any rate in d e t a i led evidence, 4 Tribunal. 5 that ? 6 A. 7 209 Q. in the Moriarty I just want to know did you know about A b s o l u t e l y not. You had not req u e sted Mr. Traynor to move the funds in any way? 8 9 some of it at A. 10 No. We never req uested Mr. Traynor to do anything except to give us the m o n e y back in early 1994. 11 210 Q. 12 A. Yes. But I have no doubt the conversation -- I can't 13 recall when the c onversations started with him to 14 tell h im we were closing, we wanted to close, the 15 accounts. 16 211 Q. 17 A. 18 212 Q. 19 A. 20 213 Q. 21 A. Yes. I see? I don't recall when t h a t ...(I N T E R J E C T I O N ). Yes? That might have been in mi d year, you know. Yes? The m o n e y only had to be paid over in 1994 but I 22 think it p r o b a b l y took a fair, a good, while with, 23 you know, various meetings and then maybe not going 24 to m e e tings in relation to it with Mr. Delaney. 25 all of that was p rob a b l y on-going for a period of 26 time. 27 214 Q. 28 A. 29 215 Q. Yes? A n d I h o n e s t l y cannot recall the length of time. Yes? So, 1 A. 2 But once we dec i d ed to take the amnesty, to avail of the amnesty, we w ou l d have told Mr. Traynor. 3 216 Q. 4 A. 5 217 Q. Yes? So, w h e n that was I don't know. Yes. I think that is p e r f e c t l y clear, Mr. McKeon. 6 Your r e c o l l e c t i o n is that you told Mr. Traynor you 7 were going to close the account but you did you 8 instruct h im to make t h e . . . (INTERJECTION)? 9 A. 10 218 Q. 11 To trans f e r the funds in the way that we now know the funds were transferred? 12 A. 13 219 Q. 14 A. 15 16 A b s o l u t e l y not. A b s o l u t e l y not. Yes? We were only conc erned about getting the funds to p a y the Revenue. 220 Q. There is one other aspect that I want to ask you 17 about Mr. McKeon. 18 o b t a i n e d there is a letter from the Cayman 19 International Bank and Trust Company L i m ited to 20 Irish I n tercontinental Bank Limited, w h ich refers to 21 what appears to be your accounts, 22 r e l ating to your accounts 23 A. 24 221 Q. 25 A. 27 222 Q. 29 and the code (Same H a n d e d ) ? Sorry, y e s . This is a letter signed by Joan Williams (Exhibit 3) ? 26 28 On the documents that we have Yes. It is a request of the 17th June 1993 to transfer to the Bank of Ireland: "For the following accounts..." 1 2 A n d there is a D e utscheMark account in B/P and there 3 is a D e u t s c h e M a r k account, 4 account, 5 references to the code of the account was to you? 6 No. 7 223 Q 8 A 9 224 Q in B/Q. another DeutscheMark Did you know whether or not those You did not know? No. There is a further request from the sterling 10 account, a m o v e m e nt but you knew nothing about how 11 this was done? 12 A 13 225 Q 14 No. The m e c h a n i s m s of this or the code that the accounts were kept in? 15 A 16 226 Q No, no. I see. Mr. McKeon, there just ma y be a couple of 17 other matters we want to consider. 18 for coffee n ow for ten minutes or so? 19 A 20 227 Q 21 22 Yes . If you wou l d stay here and you can have a cup of coffee and we will be back in about ten minutes? A Thank you. 23 24 25 26 27 28 29 We usually break SHORT ADJ O U R N M E N T 1 renew our interview. 2 3 Ms. M a c k e y w o u l d like to ask you some questions. 4 5 END OF E X A M I N A T I O N OF MR. McKEON BY MR. JUSTICE 6 C O S TELLO 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 228 Q MS. MACKEY: I really only have two 4 questions Mr. McKeon? 5 A 6 229 Q All right. One is in relat i o n to something you said in your 7 s tatement and I would just like you to confirm it 8 n ow in your sworn evidence? 9 A 10 230 Q 11 Yes . You say on the second page of your statement there on the third p a r a graph (Exhibit 1): 12 13 "I made a n umber of small withdrawals from the a c c o u n t ." 14 Can you just c o n f irm that to us now for the 15 transcript, 16 w i t h drawals ? 17 A Yes. that from time to time you made some I recall, there was one that I recall making 18 when I was on holidays one time because I wanted to 19 r e a l l y establish, 20 do not recall -- I recall maybe there was a couple 21 of others but I recall one very clearly. 22 231 Q 23 A I think it was the first one and I Yes? That I made when I was on holidays in the States 24 with the family and I wanted to just really 25 e s tablish could I get m o n e y out of this at all or 26 was I, you know, and it did work but it took a 27 n umber of p h one calls for to 28 232 Q What did you do in order to make that withdrawal? 29 A The one that I have a clear m e m o r y of and that is 1 the only one I have a clear m e m o r y of, is that I was 2 going to the States on holidays with the family and 3 I wou l d have informed, 4 P adraig Coll e r y that I was going and that I wanted 5 to have some dollars in the S t a t e s . 6 233 Q 7 A I think it was You did this b efore you went? I wou l d have i n f ormed him before I went and I knew 8 where I was staying and I asked him to establish or 9 to identify a b a n k which wou l d have been adjacent to 10 where I was staying in a hotel and he did that and 11 he came b a c k and he would have told me where to go 12 and to get the money. 13 went, they did not know anything about it so then I 14 h ad to make phone calls back to Dublin and the 15 following day I think I received my — 16 large amount of money, 17 r e l a t i v e l y . . . ( I N T E RJECTION). 18 234 Q 19 20 When I went, it was only I recall when I it was not a a It was the b a n k near your hotel that actually c ont a c t e d Dublin or did you ring? A I rang Mr. Coll e r y and I told him that I could not, 21 there was no -- the bank did not know anything about 22 giving me some money. 23 235 Q 24 A 25 A n d it was then transferred? I h o n e s t l y do not know what to make of it. got the money. 26 236 Q 27 A 28 237 Q 29 A But you got it? I got the m o n e y and that was That is fine? That was i t . I just 1 238 Q That is that q u e stion and then just one other to 2 c larify what you were telling us there about your 3 compliance with the tax amnesty? 4 A 5 239 Q 6 A 7 240 Q Yes . In 1993? Yes . You were e x p l a i n i ng to us that you formed your own 8 v i e w and made up your own m i n d that the time had 9 come to r egularise your affairs? 10 A 11 241 Q Yes . In r e l ation to this trust in the Cayman Islands, why 12 did you feel it n e cessary to regularise your affairs 13 in respect of that trust? 14 A If I can answer it this way to you by saying the 15 a m n e s t y was brought in, I felt I was obliged, 16 under law to regularise my affairs and, therefore, 17 w h a t e v e r affairs I was regularising the trust, 18 money, was away there and I wanted to you know. 19 242 Q it was the I suppose m y question, to be more direct, did you 20 bel i e v e you owed tax as a result of the deposits in 21 that trust? 22 A Yes, I think that would be, yes. Having analysed at 23 the time that the amnesty came in, that certainly I 24 w ou l d believe at this stage would have been a reason 25 w hy I felt that I had to. 26 to p a y the tax and I also wanted to not have this 27 trust anymore. 28 Yes I u n d e r s t a n d t h a t . 29 owed tax on the interest that had accum u l a t e d on the If I owed tax, I wanted Did you believe that you 1 2 Yes, 3 computations that was done by Mr. Delaney, 4 all the figures and he did all the calculation in 5 r e l ation to the various elements of tax that was due 6 in the various ways, whether it was, you know. 7 244 Q I think that was absolutely because in the he got Had it been your belief from the beg i n n i n g of this 8 trust that there would have been a liability for tax 9 in respect of the m o n e y in the trust? 10 A I just cannot recall. I suppose I w o uld have at the 11 time we did it, it was p r o vision for the rainy day 12 bec a u s e they were very difficult times and that 13 p r o b a b l y was not as much of a consideration at that 14 time as may b e to have something in -- because in the 15 b u i l d i n g i n d ustry right through the 1 9 8 0 's were very 16 difficult times. 17 have s o mething for the rainy day but then things had 18 kind of cha n g e d and when this came along that was - ­ 19 so the focus at the time wou l d not have been 20 245 Q 21 A I understand? You know may b e t h inking of the element of tax, I m e a n I h o n e s t l y ...... (INTERJECTION) . 22 23 The thought at that time was to 246 Q Yes, I know. W o u l d I be correct in understanding 24 then that you did not make returns during the period 25 pri o r to the amne sty of the interest that had 26 a c c r u e d in this account? 27 A That w o u l d be the best of my recollection that I did 28 not. 29 That is fine, I have no further questions. 37 Thank 1 2 3 A. That is best of m y r e c o l lection that I did not. MR. JUSTICE COSTELLO: Mr. Rowan? 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF E X A M I N A T I O N OF MR. McKEON BY MS. MACKEY 1 2 3 MS. R O W A N : : Mr. McKeon, 4 you say in your statement that when 5 you were opening the account that the investment was 6 in the form of approved various currencies, 7 i n cluding US dollars, 8 A 9 249 Q 10 11 deutschemarks and sterling? Yes . W h y did you choose a range of currencies to hold the investment in? A At the time when the m o n e y would have been given to 12 Guinness & Mahon, we would have been advised, 13 recollection, by Guinness & Mahon that the funds 14 w o u l d be best held in the various -- I do not ever 15 recall saying, 16 sterling, put that amount in dollars, put that 17 amount in d e u t s c h e m a r k s . 18 that they a d v i s e d us as to what the best currencies 19 to h o l d the funds in. 20 250 Q is my you know, put that amount in My recollection would be Did they give you any other advice in relation to 21 the m a n a g e m e n t of the investment? 22 No. 23 other than there was a management charge, 24 p e r i o d i c a l l y when we would get the statement, 25 w o u l d show the amount in the file. 26 b e e n a manag e m e n t charge but, no, I do not ever 27 recall getting any other advice other than being 28 told o c c a s i o n a l l y that, maybe switch the currencies, 29 may b e switch some from deutschemarks into sterling I do not recall any other advice in relation it There would have 1 or dep e n d i n g on - ­ 2 251 Q 3 A 4 5 Did they give you advice to do that? P e r i o d i c a l l y they would have given us advice to switch. 252 Q W h e n they gave you that advice, was that advice 6 which was r e q u e s t ed by you or offered by them 7 w ithout your requesting it? 8 A M y r e c o l l e c t i o n w ou l d be it might have come in the 9 form that when this statement came there might have 10 b e e n a note on it to say that, maybe to switch some 11 of the funds. 12 c omm u n i c a t i o n with -- during the time -- with 13 Des Traynor or with anybody there. 14 bec a u s e I am not a financial person and I would not 15 have been q u a l i f i ed enough to say, put it into 16 w h a t e v e r forms because I wou l d not have currencies, 17 I wou l d not have known which one was going to give 18 the best returns so that advice would have come from 19 them but it w o u l d have come periodically. 20 w o u l d have b e e n very little contact is my 21 r e c o l l e c t i o n over the pe r i o d that this was from 1986 22 until 1993. 23 253 Q C e rtainly I do not recall having much I would not There Just let me u n d e r stand this, at some point 24 Guinness & Mah o n would have said and I am really 25 par a p h r a s i n g ? 26 A 27 254 Q Yes, sure. They w o u l d have said, look Mr. McKeon, we think you 28 s hould change some of those dollars into 29 d e u t s c hemarks or whatever? 1 2 255 Q 3 4 Is that what happened, did they send you a letter or did they ring you or how was it done? a It w o u l d have been, I think o c c a s ionally it might 5 have been on the end of the statement that would 6 have come sugges t ing that some of the funds might be 7 transferred. 8 256 Q 9 a 10 How do you m e a n on the end of the statement? Just handwritten, statement, 11 257 Q 12 A this statement; I am calling it a a piece of paper. Yes? W i t h Tara on it and o c c a s ionally there ma y have been 13 a note at the end just to say, maybe, 14 that some of the funds would be transferred, you 15 know, put into different currencies or different 16 amounts held in, say if there was whatever amount 17 was in deutschemarks, maybe for it to come out of 18 d e u t s c hemarks or put more m o n e y into dollars or more 19 m o n e y into sterling. 20 258 Q 21 22 Was there an expl anation given as to wh y that might have been a good thing to do? a 23 I can only recall that it was because the return w o u l d be better. 24 259 Q 25 a 26 260 Q 27 a 28 261 Q 29 a suggestion The interest return? Yes . Were there deal i n g charges each time this happened? I do not recall. Did you gain any impression as to whether this i nvestment advice was advantageous to you or 1 2 I do not recall. 3 time, 4 that the advice they would give you w o uld be 5 a d vantageous rather than to your discharge, to one's 6 disadvantage. 7 way, 8 do I recall, you know, maybe six months later if 9 one l ooked at the sheet as to whether that was I think I would have thought at if s o m e b o d y had some m o n e y bel o n g i n g to you I can only answer the question that I do not know. I hone s t l y do not know and nor 10 ana l y s i n g it. 11 say, that was a b ad decision. 12 that. 13 262 Q 14 15 I do not ever recall analysing it to I do not ever recall But you assumed from the information you had that the advice was good advice? A I can only say that from the point of view because 16 s o m ebody was m a n a g i n g this thing or looking after it 17 and I w o uld have hoped, 18 p r e s u m p t i o n at the time that the advice they were 19 g iving me was for m y benefit as opposed to a 20 disadvantage. 21 263 Q 22 23 So that you m a y have made some gains when the c urrencies appreciated? A 24 25 it would have been my I h o n e s t l y do not know, there ma y have been, I do not know. 264 Q Mr. Delaney, of course, wou l d have been in a 26 p o s i t i o n to have perhaps assessed this when he was 27 doing the calculations you explained? 28 Again, 29 he w o u l d have b e e n more focused on calculating the I h o n e s t l y do not know. I wou l d have thought 1 tax that was due on the interest or whatever gain 2 that was done. 3 the statements at the time, just w o uld have come 4 into h im and it w ou l d have been a question of going 5 b a c k and d e c iding as to the various levels of tax 6 that was due and calculating that over the years. 7 do not know, I h o nestly do not know as to whether - ­ 8 I cannot say there was any currency gain, 9 know. 10 265 Q 11 He would have had the information on I do not I take that point that you do not know whether there was a curre n c y gain? 12 A 13 266 Q 14 A 15 267 Q 16 I h o n e s t l y do not know. W h e t h e r there was not a currency gain? I do not know. A n d you do not know whether those gains ma y have c rea t e d any sort of liability for you? 17 A 18 268 Q I am sorry, I do not know. V e r y well. 19 MR. SHIELDS: May I clarify that? 20 MR. ROWAN: Certainly? 21 MR. SHIELDS: I think Mr. Delaney did 22 take into account, as I 23 u n d e r s t a n d from the gain, 24 I u n d e r s t a n d that. 25 Mr. M c K e o n m a y not recollect that but from our 26 c onversations with Mr. Delaney, we believe he ma y 27 have taken that into account. 28 MR. ROWAN: 29 I some gain on the currency. That is all I can say. It w o uld be useful just to have clarification of that 1 2 3 4 Yes, 270 Q fine. MR. ROWAN: I do not know in what way 5 you can provide us with 6 c lar i f i c a t i o n but, 7 document whi c h is helpful in clarifying it? 8 A 9 for instance, if you have a I p e r s o n a l l y have no documentation. I have a b s o l u t e l y no documentation. 10 MR. SHIELDS: I think the question that 11 you wish to have clarified 12 is whet h e r a gain on the currency was taken into 13 account in m a k i n g the calculations to avail of the 14 1993 legislation? 15 271 Q MR. ROWAN: Yes, I think there were 16 two questions, Mr. McKeon 17 if I m a y put this to you? 18 A 19 272 Q 20 21 One is were there gains and secondly, were they a c c o u n t e d for in terms of the 1993 amnesty? A 22 23 Yes . Right. We will e ndeavour to get the information. do not know. 273 Q Okay. Thank you. The other point I would like just 24 to talk to you about, earlier in the interview we 25 dis c u s s e d a letter which was dated the 7th January 26 1994, the one wri tten on Mr. Traynor's note paper, 27 at least his 42 F i tzwilliam Square 28 29 I A (Exhibit 2)? Yes . W h i c h you signed, it was an instruction to 44 1 Mr. Ronan R e d m o n d of the Irish Intercontinental Bank 2 to raise some cheques and there appear to be five 3 cheques, 4 C o m m i s sioners and the fifth payable to Management 5 and A d v i s o r y Industrial & Provident Society Limited? 6 Yes . 7 275 Q M a y I ask you, do you know the principal of that company? 8 9 A 10 276 Q 11 12 four of them payable to the Revenue Of? Of Manage m e n t and A d v i s o r y Industrial & Provident S oci e t y Limited? A That was a company within Sheelin. Sheelin Homes 13 was part of the Management and A d v i s o r y and 14 Industrial Provident Society. 15 that was c o n t r o l l ed by John Kennedy and myself so 16 that Manag e m e n t A d v i s o r y and Industrial Provident 17 S oci e t y is still there. 18 277 Q I see. Thank you. 19 questions? 20 Yes, thank you. That was a company I do not have any other 21 22 23 24 25 26 27 28 29 END OF EXA M I N A T I O N OF MR. McKEON BY MR. ROWAN 1 2 COSTELLO: 3 4 MR. JUSTICE COSTELLO: 5 I think that is all we require then. 6 MR. SHIELDS: There is one point 7 Justice Costello I would 8 like to clarify. Mr. McKeon was asked a question I 9 think by y o u rself in relation to Tara Securities and 10 the M o r i a r t y Tribunal and the detailed financial 11 rou t i n g of certain payments, which evidence was 12 given to the M o r i a r t y Tribunal. 13 saying, that he was not aware and he has asked me to 14 c lar i f y it; not aware of that and that is so but he 15 was in the last week or two given a 16 c o p y . . . (INTERJECTION). 17 MR. JUSTICE COSTELLO: 18 I think he replied Sorry, does the witness, does he want to 19 give evidence about this? 20 MR. SHIELDS: He asked me to clarify it. 21 MR. JUSTICE COSTELLO: He could clarify it then. 22 MR. SHIELDS: Fine, if he can indeed. MR. JUSTICE COSTELLO: Yes, if you want to 23 278 Q 24 25 clarify something? A Yes, it was only within the last week, through my 26 solicitors, 27 said, just it was a cutting I think from the 28 Irish Times. 29 a n y t h i n g about it so I only learned within the last that they gave me a piece of paper which I did not see it. I did not know 1 week. 2 279 Q 3 A But I knew a b s o l u t e l y nothing about it whatsoever 4 but just to cla r i fy that I knew nothing about it but 5 I know something about it now, in the form of that 6 but only w ithin the last week. 7 280 Q That is p e r f e c t l y clear, Mr. McKeon. Our 8 i n v e stigations have to be thorough, we ascertained 9 in the way we have indicated some evidence. We got 10 other evidence from different source of the movement 11 of these funds? 12 A 13 281 Q 14 A 15 282 Q Yes . From June to Janu ary of 1994? Yes, yes. What I was asking you was whether or not you were 16 aware of this movement, 17 this m ovement? 18 A 19 283 Q and you were not aware of No, no. You did not b ecome aware of it until your solicitor drew your att e n t i on to the press cutting? 20 21 A 22 284 Q That was only w i t hin the last week. V e r y well, that is fine. MR. JUSTICE COSTELLO: 23 24 Mr. McKeon, your evidence will now be transcribed 25 into a typed script and we would ask you to come in 26 and sign the transcript when it is ready? 27 A Fine thank you. 28 MR. JUSTICE COSTELLO: 29 THE EXAM I N A T I O N WAS THEN CONCLUDED Thank you. - UNSWORN STATEMENT OF MR. SEAN McKEON I, Sean Me Keon, of 163 Howtfa Road, Dublin 3, refer to your letter of 1st February, 2000. My former business partner, Mr. John Kennedy and I were involved for many years in Sheelin Homes Limited, a property development and building company. I recall a conversation in the early 1980’s between Mr. John Kennedy, Mr. Maurice O’Kelly of Guinness and Mahon (Ireland) Limited and I when Mr. Maurice O’Kelly mentioned that there might be an opportunity to form a trust to “put some money away for a rainy day” having regard to the feet that the early 1980’s was a difficult time generally for builders. - Mr. O’Kelly informed me that the investment would be set up in the form of a trust and that while the trustees would take my instructions and that they were honourable people, to a degree I was putting my trust in them that the monies would not disappear. Mr. Des Traynor was mentioned as being the person in charge of the creation, organisation and management of the trust I considered the matter for some time and ultimately I decided to invest monies in the trust for such a “rainy day”. I signed certain trust documentation, probably in 1986. The trust was called Tara Securities Limited. I do not know who the settlor of the trust was. 1 did not understand how the trust was set up as generally I did not deal with financial matters in relation to the business. I signed a letter of wishes, possibly around the time of the setting up of the trust. Originally, I was informed that the trust was a discretionary trust which was to be located in the Cayman Islands. It was only at a later stage that I became aware that Ansbacher (Cayman) Limited was involved. I attended at the offices of Guinnness and Mahon (Ireland) Limited at Trinity Street, Dublin 2, on a few occasions. I was introduced to Mr. Des Traynor and Mr. Padraig Collery. To the best of my knowledge, I did not meet Mr. John Furze, however, his name was mentioned on a number of occasions. The investment was in the form of a pool of various currencies including US Dollars, Deutschmarks and Sterling. A periodic management charge was imposed. Intermittent statements were sent to our office at Sheelin Homes Limited, approximately once or twice a year, on a sheet of paper with no letterhead, just a handwritten note with the word "Tara” on it, sometimes these statements were signed by Mr. John Furze. I have enclosed a copy of such a statement I was generally on site when this occurred. The return obtained on the investment was never apparent as the information received by me was not set out in a dear manner. To the best of my knowledge I made no further lodgments after the initial lodgment I made a number of small withdrawals fromthe account, mainly to ensure that the monies in the trust had not disappeared, also as the trust fund was for a ‘rainy dayVI did not regard the trust as a general source of funds. Further, I note in your letter of 1st February, 2000, at paragraphs (2) to (5) thereofthat reference is made to credit facilities offered by Guinness and Mahon (Ireland) Limited and other financial institutions to Irish residents who held deposits with. Ansbacher (Cayman) Limited. I did not avail of any such credit facilities. In 1993 I decided to regularise my tax affairs and to avail of the Tax Amnesty of 1993. In this regard, I met Mr. Des Traynor at his office in 42 Fitzwilliam Square, Dublin 2 on a few occasions in late 1993 in order to withdraw all monies held on deposit by me in order to make a payment to the Revenue Commissioners* It would appear from a copy letter that I recently received from Mr. John Kennedy’s Solicitors that Ms. Joan Williams may have collected certain cheques on my behalf (when the account was being closed), drawn by Irish Intercontinental Bank. I have enclosed n herewith a copy of this letter which I understand has already been furnished to you by Mr. John Kennedy. Also in 1994, having regard to the fact that I had regularised my tax affiiirs, I destroyed all my books and records relating to the trust As a result of recent searches, pursuant to your letter of 1st February 2000, my accountant has furnished to me two copy statements, which are the only documents in his possession,which he would have got for the purpose of computing my tax liability when I was availing of the Tax Amnesty of 1993. As you have indicated in your letter of 1st Febuaiy, 2000 that you do not require details of the amount of funds or other assets transferred to trusts, I have been advised by my Solicitors that it is appropriate that such financial details be deleted from the copy documentation enclosed herewith. I have written to Guinness and Mahon (Ireland) Limited with a view to obtaining copies of any records pertaining to my account, lhave not received a reply to this correspondence. . I note in your letter to me of 1st February 2000, at paragraph. 6 of Appendix C thereof, you refer to the Exchange Control Acts (1954-1992). I do not know whether any application was miHn on my behalfunder the Exchange Control Acts (1954-1992). I would not have averted to this matter. I would have expected that all legal requirements had been dealt with by those who established the trust. Dated this / / ^ day of May, 2000 SEAN McKEON inowec/LkMaAatufee 1 878 3144/878 3065 rax 661 2035 . 42 FTTZYVJLUAM SQUARE Oil BUN 2 7 th Jan u ary, 1994. Konain Radnondr S « q « r C o r p o r a te S e r v ic e * , Ir i s h In te r c o n tin e n ta l Bank Lim ited# 91 M e rrio n Square, DUBLZB a. Ra: Account Ho.02/71808/0 D ear M r. Redmond, . Could »you pleaae arrange to- iaaua tha fallowing' Eriah Pounds cheques, debiting the Starling coat to the.above Accounts Payable to Payable to Payable to Payable sto She She The She Revenue Revenue Revenue Revenue Cdtnaiaalonera Cenmiesionara Goamleaionara Canmiaalanere uui Tag IS 6" t b b Payable to Management and Adviaory induatrial and Provident Seoiaty Eitd. XB£' It «rould be appraeiated if yon could have these chaquaa • available for collection by Joan Villiaaa o£ Mr. Traynor'a 0£fiee on Tueaday next, 1-1th January. Xt would alao be appreciated if you could adviae Joan Williapw of tha Sterling amounts debited In reapeot of the above when letting her have the cheqnea.Tousa sincerely, : , Cayman lntemational Bank and Trust Company Limita H caseieplylo:^ 42 Ktzwilliam Squats, Dublin 2. Td: 676 5144/676 3065 Far 6612035 ' P.O. Bex 187, Grand Facsimile (809) 949-794, (Fonaafr AabacicrLimM . R o n a n Redm ond, S a g . , C o rp o ra te S e r v ic e s , I r i s h In t e r c o n t in e n t a l B ank L im it e d , 91 M e r r io n S q u a r e , ' D U BLIN 2 . D ear Ronan, . ' F u r t h e r t o o u r l e t t e r o f y e s t e r d a y ' s d a t e i n c o n n e c t io n w it h t h e US D o l l a r s a n d D e u ts c h e M a rk s w h ic h y o u a r e h o ld in g on d e p o s i t u n d e r r e f e r e n c e B /P an d B /Q , c o u ld y o u p le a s e a r r a n g e v a l u e 2 9 t h J u n e t o t r a n s f e r p r i n c i p a l a n d i n t e r e s t i n e a ch c a s e t o : B a n k o f I r e l a n d , I n t e r n a t i o n a l D e p t . , Head O f f i c e , Low er B a g g o t S t r e e t , D u b lin 2 , f o r t h e f o l l o w in g - A c c o u n t s : • ' ^ DMs i n A c c o u n t R e f . B /P t o DEM A c c o u n t N o .3 1 5 2 5 3 0 1 V /* U S$ i n A c c o u n t R e f . B /P t o US$ A c c o u n t N o .31 5 2 5 3 0 0 JD^T ;.b\2.0 lOMa JLn A c c o u n t R e f . B /Q . t o , frsM, A c c o u n t N o .3 1 5 2 6 3 0 1 ? . ...... ^ ^ tJfsi i i R A c c o u n t i a f . W a , t o OS* vA cq puiit N o . 3 1 526 30 0 ^ J I t w o u ld b e a p p r e c ia t e d i f y o u c o u ld a d v is e th e e x a c t a m o u n ts b e in g t r a n s f e r r e d s o t h a t we c a n i n t u r n a d v is e B a n k o f I r e l a n d . C o u ld yo ti a l s o p l e a s e a r r a n g e v a l u e 2 9 t h Ju n e t o t r a n s f e r tw o am o u n ts o f S t e r l i n g a s f o l l o w s , d e b i t i n g b o th sums t o o u r N o .1 A cco u n t N o .0 2 /0 1 0 8 7 /8 1 . T h e s e s h o u ld a l s o 90 t o B an k o f I r e l a n d S t g . £ 5 0 0 ,0 0 0 t o GBE A c c o u n t N o . 3 1 5 2 5 3 0 2 £5Y S t g . £ 2 7 5 ,0 0 0 to. GBfi 'A cco u n t N o . 3 1 5 2 6 3 0 2 / ^ $ VD P l e a s e a d v i s e i f y o u h a v e a n y p r o b le m s o r i f a n y t h in g i s Y o u rs s in c e r e ly , GPU- r ■ F Mr C A Y M A N I N T E R N A T I O N A L B A N K A N D T R U S T CO. LTD. Guernsey - Monaco - Zurich - Nassau - Cayman - BVI f / V . not c le a r . LK SH IE L D S SOLICITORS 3 9 /4 0 U pper M o u n t Street D u b l in 2 , I r e l a n d . . «... The Joint - Inspectors. H is H on o u r Ju d g e S ean O 'Leary. M s. N oreen M ac key BL, Mr. Paul R ow an F C A , M r. M ichael C ush SC. T hird Floor, T rid e n t H ouse, B lackrock. C o. D ublin Re: Telephone:353+1 661 0866 Facsimile: 353+1 661 0883 D.D.E, Box No: 123 E-Mail:email@lkshields.ie W ebsite:www.lkshields.ie our ref: 178-3 2 9 /L K S /E C /R B /0 2 0 12212L 1 your ref : C /M 0 9 /N S /P M 23 Jan u ary 2002 Our Client: Sean M e Keon D ear Sirs / M adam , W e refer to y o u r letter to o u r c lie n t o f the 21st D ecem ber, 2001 se ttin g o u t y o u r p re lim in a ry c o n clu sio n s in relatio n to o u r client. W e have a n u m b er o f observ atio n s to m ak e in re la tio n to sam e as fo llow s:O u r first and m o st fu n d a m e n ta l o b je c tio n is th at you h av e b een a p p o in te d In sp e cto rs “ to investigate the affairs” o f th e com pany. N am in g the “ c lien ts” o f th e co m p an y is n o p a rt o f in v estig atin g th e affairs a n d it n o t n ecessary fo r the p u rp o ses o f in v estig atin g th e affairs o f the com pany. T o list th e “ c lie n ts o f A n sb a ch e r” and identify th e m by n am e is ultra vires the p ro v isio n s o f th e C o m p a n ie s A ct, 1990. It is no an sw er to th is to say th a t th e In sp ec to rs are required to do it p u rsu an t to th e o rd e r o f the H igh C o u rt dated 2 2 nd S ep tem b er 1999. In o rd er to ad v ise o u r c lie n t w e sh o u ld be obliged to receiv e copies o f all m a teria l th a t w as p u t b efore Jo h n so n J. w h en he w as in v ited to m ake th e o rd e r in th e first place to in c lu d e th e affid av its o f Paul A p p leb y an d th e ex h ib its thereto. W e should also be o b lig ed to rec eiv e co p ies o f all ord ers m ade by th e C o u rt (in clu d in g all ex p arte orders) in re la tio n to th e te rm s o f re fe re n ce and the pow ers, an d fu n ctio n s an d duties o f the Inspectors. T his is fu n d am e n tal to d u e process. O u r clien t reserv es his p o sitio n in relatio n to the O rd er m ade by M r Ju stic e Jo h n so n o n 22 S eptem ber. 1999. Please note that all fu rth er su b m issio n s m ade in th is le tte r are ex p ressly m ad e w ith o u t p reju d ice to this submission. LAURENCEK.5HIELDS,EDMUNDBUTLER,PATRICIAMcGOVERN,HUGHGARVEY,JOSEPHVi.GAVIN,EMMETSCULLY.GERARDHALPENNY. JUSTINMcKENNA,MICHAELKAVANAGH,EUGENEFANNING,DAVIDJ.H.WILLIAMS.FIONATHORNTON,NICOLAPALMER, PHILIPDALY,MARCOW.HICKEY, AOIFEBRADLEY.STEPHENBRENNAN,SIOBHANBUCKLEY,PAULABURKE,JENNIFERCLARKE,EOINCUNNEEN.PATFOX,JAMESMcGlLLION, NIAMH McKEON,ORLAIGHO'DWYER,DERVALO'HALLORAN,JENNIFERO'NEIL!.CORACRAMPTON(Financi.ilController).THOMASJACKSON(Consultant). A s you arc aw are, o u r clien t clo sed his ac co u n t in Jan u ary,1994 in o rd e r to av ail o f the W aiver ol C ertain Interest and P enalties A ct, 1993 (“ the T ax A m n e sty ”). In pu rp o rtin g to m ake a finding o f fact th at o u r clien t w as a “clien t o f A n sb ac h er” (w h ic h w e n o te you have n eg lected to d efin e an d w e call upon y o u to do so), w e w o u ld re sp e ctfu lly subm it i hat von are co n tra v e n in g th e sp irit o f leg islation en acted by th e O irea ch ta s w h ich e n titled people to d eclare to th e R ev en u e C om m issio n ers and deal w ith in a co n fid e n tial and law ful m an n er any p rev io u sly u n d eclared tax a tio n liabilities. W e see a b so lu te ly no ju stific a tio n for y o u to refer to the co m p an y S h ee lin H om es L im ited. M any p erso n s have been in v o lv ed w ith this com pany o v e r th e years and it is an invasion o f th e ir rig h t o f p rivacy as w ell as th at o f the c o m p an y to g e th e r w ith the com p an > 's good n am e to m ake reference to the com pany in th e co n te x t o f a re p o rt such as this. W e a cco rd in g ly req u est th at the w h o le o f the first sen ten ce o f y o u r prelim in ary c o n c lu sio n s be d eleted. T he sta te m e n t in the seco n d p arag rap h “ Around 1986, he permitted a discretionary trust to he established in the Cayman Islands” presen ts an u n b alan ced p ic tu re o f w h a t actually happen ed . In the in terests o f balan ce, th is sh o u ld include a referen ce to th e fact th at this w as d one by our clien t ” at the suggestion o f G M F . 'There is no ev id e n c e to su p p o rt th e statem ent 1‘ G M C T managed the trust (he believed)." If an y th in g , the referen ce sh o u ld be to GM I. T he sta te m e n t th at o u r c lie n t “ enjoyed the use of the trust funds by means of a service provided by Ansbacher whereby he was able to withdraw funds in Ireland” is u n tru e and m islead in g . O u r c lie n t n e v e r k n o w in g ly had any dealings w ith A n sb a c h e r (as defined). O u r c lie n t's sta te m e n t says th a t he m ade a n u m b er o f sm all w ith d ra w als fro m the acco u n t, m ain ly to e n su re th a t the m onies h ad n o t d isappeared. O ne su c h w ith d raw al w as m ade in the U nited S tates th ro u g h M r. C ollery. T he fact th a t th e fu n d s in v o lv e d w ere on o ne o ccasio n p aid to acco u n ts in Ireland (w h en the acco u n t w as clo sed in o rd er to av ail o f the T ax A m n esty ) does not m ean th at th ey w e re w ith d raw n in Ireland. It a p p e ars from e x h ib it 2 that in stru ctio n s w ere g iv en to IIB to m ake funds av ailab le in Irish p o u n d s in Ireland but th e w ith d raw al co u ld h ave tak en p lace anyw here. A t best, th e ev id en ce w o u ld su p p o rt a sta te m e n t th at o u r clien t “ enjoyed the use of the trust funds by means of a service whereby he was able to obtain funds from Mr. Desmond Traynor or M r Collery.” G iven the d am ag e to o n e 's good nam e asso ciated w ith b ein g n a m ed as a “clien t o f A nsb ach er". w e resp ectfu lly su b m it th at it is in cu m b en t on th e In sp ecto rs to p resen t a c o m p lete picture an d av o id cau sin g unnecessary harm to our c lie n t’s g o o d nam e and rep u tatio n whi c h h e is an x io u s to protect. T h erefore, w e su b m it th a t fairn ess and yo u r co n stitu tio n al o b lig a tio n s to v in d icate o u r c lie n t’s good n am e as far as p o ssib le req u ire von to add the fo llo w in g w o rd s to th e la st parag rap h o f yo u r p relim in a ry c o n c lu sio n s:­ "in order to make a payment to the Revenue Commissioners under the Tax Amnesty. ” W e look forw ard to h e a rin g fro m y o u in relatio n to th e above. Y ours faithfully, Appendix XV (78) Mr Thomas J McLaughlin, deceased 1. E vidence relied upon by the Inspectors in arriving at the conclusion relating to M r T hom as J M cLaughlin. a) L etter o f 19 D ecem ber 2000 - A rthur Cox Solicitors to the Inspectors. b) D eclaration o f T rust - Coral R e e f Securities. c) N o m in ee A greem ent o f 11 N ovem ber 1980 - C oral R e e f Securities. d) N om inee A greem ent o f 11 N ovem ber 1980 - Coral R e e f Securities. e) N o m in ee A greem ent o f 11 N ovem ber 1980 - Coral R e e f Securities. f) A nsb ach er Lim ited statem ent o f a/c o f 31 M arch 1993 re H am ilton R oss. g) A nsb ach er Lim ited statem ent o f a/c o f 31 January 1993 re H am ilton R oss. h) A n sbacher Lim ited statem ent o f a/c o f 31 D ecem ber 1992 re A nsbacher C aym an Lim ited. i) A nsb ach er Lim ited statem ent o f a/c o f 31 O ctober 1992 re A nsbacher C aym an Lim ited. j) A nsb ach er Lim ited statem ent o f a/c o f 31 M arch 1994 re H am ilton R oss. k) A nsb ach er Lim ited statem ent o f a/c o f 31 D ecem ber 1993 re H am ilton R oss. 1) A nsb ach er Lim ited statem ent o f a/c o f 30 Septem ber 1993 re H am ilton R oss. m) A nsb ach er L im ited statem ent o f a/c o f 30 June 1993 re H am ilton Ross. n) A nsb ach er L im ited statem ent o f a/c o f 30 S eptem ber 1994 re H am ilton Ross. o) A nsb ach er L im ited statem ent o f a/c o f 30 June 1994 re H am ilton R oss, p) A nsb ach er L im ited statem ent o f a/c o f 31 O ctober 1995 re H am ilton Ross, q) A n sbacher L im ited statem ent o f a/c o f 8 July 1995 re H am ilton Ross, r) A nsb ach er L im ited statem ent o f a/c o f 25 A pril 1995 re H am ilton Ross. s) A nsb ach er L im ited statem ent o f a/c o f 30 N ovem ber 1995 re H am ilton Ross. t) A n sb ach er L im ited statem ent o f a/c o f 30 A pril 1997 re H am ilton Ross, u) A nsb ach er L im ited statem ent o f a/c o f 31 O ctober 1996 re H am ilton Ross. C orrespondence received from or on b e h a lf o f T hom as J M cLaughlin, a) L etter o f 18 D ecem ber 2001 - A rthur C ox Solicitors to the Inspectors. A R T H U R C O X E vri^ hort Centrk, Earufort T errace, Dublin 2 T ul +353 1 618 0000 Fax +353 1 618 0618 Dx 27 Dublin n m il@ a r tiiu r c o x .io k ttp ://w w w .a r th u r c o x .ie Bi-1-Hast Stows Uoi.-ii;, 17-25Cuujhe Swjabk E.\*r IlKIJViST BT1 61ID TKUaiiowi +4428<#1230007 Kvx+44 2890233464 oi'ttwaWMisicii NewYork S70IjntmcrronAvi-niie, 2*ni Fuxxt NSWVciBK. NY 11)022 ThiJiPlKWll +12127590*08 Fax +1 212 6883237 ioi’iBuim»u AXC/as ■ 19th December 2000 t i a ic 'm The Inspectors Third Floor Trident House Blackrock Co. Dublin Re : Tom McLaughBnDeceased Your Reference fC/Ml^JDP Dear Sirs, My colleague, Paul M e Taiighlfn, has copied to me your correspondence to him dated 29th November, 2000, in order to obtain copies o f any documents held by me relevant to your inquiry. I have furnished to him copies o f all such documents. I was somewhat concerned however that the submission o f the documents without any explanation as to their background and meaning could lead to confusion and misunderstanding. Paul McLaughlin has advised me that he is not in a position to provide that background as he had no knowledge o f the transactions in question. However this was a matter on which Tom McLaughlin consulted me initially in June, 1998.1 felt therefore that it would be appropriate to provide an explanation o f certain o f the documents to ease the task o f the Inspectors, and because I believe that based on the information provided to me by my late client, it w ill explain that his connection with the Ansbacher deposits was innocent and not motivated by tax avoidance objectives. Background Tom McLaughlin advised me that he was a close friend o f a lady named Barbara Breen, who had worked in his company since the 1960s. Tom McLaughlin knew Mr. Des Traynor socially, primarily as a result o f the fact that Barbara Breen was a next door neighbour o f Mrs. Traynor and remained close friends with her. Tom McLaughlin was a 25% shareholder in Aran Energy and when he sold that shareholding in 1980, he used Guinness & Mahon’s stockbrokmg services and hence encountered Mr Traynor on a business level. The bank provided investment advice to Tom McLaughlin until approximately Ja m h s 0 ‘l > r v i :.R p m i . M i l A r a t M N D o n o o ii C k o 't i .i -y D a v id O 'D o n o iio k Jo h n s Ia n a . S c o t t .W a i j u C o i .m 1)» y * i a n J t m s G . 1; i s i i M ic iia k i. C a « . O S u .ij v a n C ik x x .i.v j; IJ iiT U .v C u f c l v U o u ; i; « O w x v a o L i n x v 111' M »t>V C c n V M W I ' M i- o u t iN O a n ih l e . O 'C o n n o r Josm i U .u t i:i. F o i j i v I.k y u k n Jo h n M i -a im - H u m R h j i V K o k v XT i m -u n s I ) , n ' . a . , , . . I\ .< t P m re i* M c L v i 'o i u j n K ' i i .u a m K c m iiir t H o j j o n J o i i n V. O ’D r n - R Jo h n s t o n C o n o n M c D o n n i -m . lir o iiN if M c C u ir K P a t r ic k M c O o v iiK N Ro m an V a ij ii N ic iio u * G. H i ' u e n h P. F.v s x in u M o o r i- G r a i n x i i It h N X is s Y S n - n f i - x M i-ru u iT Y D t& 'M .v D m s i a x k S a k u m C i ,w i h ; IC m i/ .M - N O a k v i 'i t I 1. ,.. m V l r m w I K - . - . * . . * . / W . m ' o M m u l» .w . v t V i D i -c l a x G i w -n Co m * I1 a y »-s B u in k I ’ U j k v k - K f t w u l i x ». f i n t ' i i i ’ .i.* r V r m jR c o x 1983. Mr Traynor made an approach to Tom McLaughlin around June, 1980 and indicated that he was concerned that Ms Breen’s interests should be adequately protected Mr. Traynor said that although she had worked in Tom McLaughlin’s com pany for about 16 years, no pension provision had been made for her and he suggested that Tom McLaughlm should establish a fiind for her benefit Tom Me t anghlm believed Mr. Traynor made the approach to him to establish the fund for Ms. Breen because o f his knowledge o f the gain Tom McLaughlin had realised on the Aran Energy shares, and also because he knew that Tom McLaughlin was in receipt of significant ESR (Export Sales Relieved) (ie tax free) dividends at that time. Tom McLaughlin then provided a sum o f some IR£382,000 to Mr. Traynor to be held on trust and applied at Mr Traynor’s discretion for Ms Breen’s benefit. Tom McLaughlm instructed me that this trust fund was funded from a mixture o f ESR dividends, which were tax exempt and also from a significant gain realised by him on the sale o f his shares in Aran Energy (on which capital gains tax had been paid). Thus the fund in question came from after tax capital gains and tax exempt income. N o documents were signed by Tom McLaughlin in relation to this trust fund nor did Mr. Traynor furnish any receipts. Tom McLaughlin did not receive any accounting statements in respect o f the fund from Mr. Traynor or any other parties. On Mr. Traynor’s death, Tom McLaughlin expected to hear from Mr. Traynor’s executors in relation to the fund. In wriv i ?o«, Tom McLaughlin learned for the first time that the fund had been invested by the late Mr. Traynor, for at least o f a period o f time, in Ansbacher Cayman. The Moriarty Tribunal supplied certain bank statements to Tom McLaughlin in respect o f a sum o f money invested with Ansbacher Cayman in the name o f Hamilton R oss, and advised Tom McLaughlin that this fund was his. Tom McLaughlin became extremely concerned when furnished with this documentation and information. Tom McLaughlm then sought to establish whether Mr. Traynor as the trustee in control o f the fund had dealt with the tax liability on the investment income generated from the fund. When he established that Mr. Traynor had not done so, Tom McLaughlin instructed me to contact the Revenue Commissioners in relation to the matter and I provided all o f the relevant information as set out above. Tom McLaughlin then discharged the income tax liability arising on the trust income. I am aware that Tom McLaughlin also co-operated fully with the Moriarty Tribunal. I furnish this background information to explain the reasons, so far as I as aware o f them, as to why Tom McLaughlin’s name emerged in the context o f Ansbacher (Cayman) Limited at all. T om McLaughlin always maintained that he never sought to evade the payment o f taxes, and had no reason to do so as a significant portion o f his income was tax exempt. It upset him greatly that a sum o f money on which all relevant taxes had been paid, which he entrusted to Mr. Traynor as a professional, had subsequently been handled the way that it was ie invested in an institution which was subsequently surrounded by so much controversy, and with tax on the investment income generated not having been dealt with properly. This was a source o f upset and distress to Tom McLaughlin from the time he became aware o f where the trust fund had been invested in early 1998 until his death in January this year. Appendix C Turning to the documents supplied by ray colleague Paul McLaughlin in response to the queries raised in appendix C o f your correspondence, those which merit comment are as follows: 1. /-v Tom McLaughlin told me that his friend, Ms. Barbara Breen, wished to purchase a house in Portugal, and received advice that in order to minimise any exposure to Portuguese inheritance taxes she should do so through an off-shore company. The house was therefore purchased through a Cayman Island company, Coral R eef Securities Limited. Although these documents refer to the property/the shares as being for the benefit o f the survivor o f Barbara Breen (known as McLaughlin) or Tom McLaughlin, Tom McLaughlin intimated to me that he regarded the property and the company as beneficially owned by Ms Breen, since the purchase o f the house was funded by her. N ote that the Revenue Commissioners have been advised o f this company and the Portuguese property, and all relevant taxes, including residential property tax, have been paid. 2. (i) The Ansbacher bank statements for the period from January 1993 to September 1994 were supplied to Tom McLaughlin by the Moriarty Tribunal. You w ill note that flic balance o f the statements were provided to me by Mr Padraig Colleaiy following my correspondence to him seeking accounting records for the funds. On Tom McLaughlin’s instructions, I contacted the Revenue Commissioners in July 1998 when he realised that income tax had not been paid on the investment income generated by the trust fund, and the income tax liability was discharged by Tom McLaughlin on being quantified by m ein early 1999. ^ (ii) I do not believe that the Guinness & Mahon documentation supplied comes within the scope o f the query set out in question 2 o f appendix C, but I have included it as requested by Ms Cummins o f your office in a telephone conversation on 111,1December last. A s mentioned, Tom McLaughlin had substantial funds available for investment in the early 1980s, the period to which these documents relate. He had realised some Stg£517,000 on the sale o f shares in Aran Energy (which converted to ER£567,289) and he was also in receipt o f substantial ESR dividends during this period. For example ESR dividends in the five years from 1980 to 1985 inclusive averaged at IR £200,530 per annum. (iii) In relation to the miscellaneous bank statements provided by the Moriarty Tribunal, Tom McLaughlin advised me that his Northern Ireland company Windsor Nutrition Ltd experienced financial problems in 1989, and was closed. His companies generally suffered cashflow difficulties for a period around that time and Mr. Traynor organised a temporary facility for Merops (Nutrition) Ltd which was subsequently repaid. 4. The document entitled Credit Committee Application was provided to Tom McLaughlin by the Moriarty Tribunal. The borrower named was Windsor Nutrition Limited, a company owned by Tom McLaughlin, which carried on business in Northern Ireland. Tom McLaughlin advised me that he had never seen this documentation prior to the Moriarty jA h u r c o x Tribunal copying to it to him. Tom McLaughlin advised me that his company Windsor Nutrition Limited did have a facility with Northern Bank Limited for which he required a guarantee o f Stg£ 100,000 in 1987, but this was only for aperiod o f one year. Tom McLaughlin indicated to me that he was puzzled by the reference on the first page o f the document to the transaction being the subject o f a review on 2 1" August, 1989. Tom McLaughlin advised me that he did not believe that the guarantee to Northern Bank would have been in existence at that time, and that there was no reference to it in the accounts o f Windsor Nutrition Ltd at that date. Tom McLaughlin further advised me that he did recall requesting the organisation o f a guarantee from Guinness & Mahon when it was required by Northern Bank in 1987, but that he was not provided with any paperwork in connection with the guarantee so provided. Tom McLaughlin was not advised by Guinness & Mahon that any fee was to be charged for the provision o f the guarantee. Tom McLaughlin instructed me that he did not have any back to back arrangement in place in respect o f this guarantee. However, Tom McLaughlin advised me that the late Mr. Traynor may have felt secure in organising the guarantee for Windsor Nutrition Ltd in the knowledge that at the time he held a significant sum o f money belonging to Tom McLaughlin under his control at that time. I trust that this information will be o f assistance in analysing the documents, and also in clarifying Tom McLaughlin’s connection with the subject matter o f your inquiry. Yours faithfully T h is D e c l a r a t i o n o f T r u s t made on b e h a l f o f CORAL REEF SE C U R ITIE S L IM IT E D , a Company i n c o r p o r a t e d i n th e Cayman I s l a n d s and h a v in g i t s r e g i s t e r e d o f f i c e a t P .O . Box 8 8 7 , Grand Caym an, B . W . I . ( h e r e i n a f t e r c a l l e d " t h e C om pany") WITNESSETH AS FOLLOWS: - • 1. THAT t h e Company iis t h e o w n e r o f S i t e No. 5 3 4 , V a le de L o b o , -A lm a n s il, A lg a r v e , P o r tu g a l ( h e r e i n a f t e r c a l l e d " th e p r o p e r t y " ) . 2. THAT th e Company h o ld s th e P r o p e r t y f o r and on b e h a l f o f BARBARA M. McLAUGHLIN an d TOM McLAUGHLIN o f 4 1 W a te r lo o L a n e , B a l l s b r i d g e , D u b lin 4 , I r e l a n d , as j o i n t t e n a n t s an d t h a t on th e d e a th o f e i t h e r t h e s a i d BARBARA to. McLAUGHLIN o r TOM McLAUGHLIN, th e Company w i l l h o ld t h e P r o p e r t y i n t r u s t f o r th e s u r v i v o r a b s o lu te ly . . 3. THAT i n th e e v e n t o f t h e BARBARA M. McLAUGHLIN and TOM d i s p o s i t i o n o f th e P r o p e r t y w f o l l o w i n g i n d i v i d u a l s n a m e ly , JAMES DESMOND TRAYNOR. I N WITNESS WHEREOF THE COMMON SEAL o f C o r a l R e e f . S e c u r i t i e s L i m i t e d was h e r e u n t o a f f i x e d i n th e p re s e n c e o f: John A . C o l l i n s D i r e c t o r , and John A . F u r z e D ir e c to r . s im u lt a n e o u s d e a th o f t h e s a i d ' McLAUGHLIN, i n s t r u c t i o n s f o r th e i l l come fr«n» e i t h e r o r b o th o f th e JACK J . STAKELUM o r NOMINEE AGREEMENT CAYMAN ISLAHDS l/We Jo h n k. F u r2e f * of P . O. Box 8 87 , Grand Cayman hereby declare that th e ----- N in e t y E ig h t — in • share (a) CORAL REEF SECURITIES L IM ITE D now standing in my name in the books of the said Company was /were pur­ chased or provided out of moneys belonging to x . J . M c L a u g h lin & / o r B a r b a r a B re e n f o r th e b e n e f i t o f th e of s u r v iv o r 41 W at-p ^ o o L a n e , D u b lin 4 , (hereinafter called “ the Owner") and is/are now held by me/us as nominee for the said Owner. As witness my hand this 1 1 th day of November . 80 . Ir e la n d rprst^ ^ •- NOMINEE AGREEMENT CAYMAN ISLANDS I/We O e lr o s e M. W illia m s of P .O . Box 8 8 7 , G rand Cayman hereby declare that t h e ----- O n e ----- share {«) in C o r a l B e e f S e c u r i t i e s L im it e d now standing in my name in the books of the said Company was /were pur­ chased or provided out of moneys belonging to B a rb a ra B re e n T t J i M c L a u g h lin & /o r f o r th e b e n e f i t o f th e s u r v iv o r 41 \o o L a n e , D u b lin 4 , (hereinafter called "the Owner") and is/are now held by me/ua as nominee for the said Owner. . As witness my hand this 11th day of November 1® SO A DELROSE M. WILLIAMS Ir e l? M NOMINEE AGREEMENT CAYMAN ISLANDS c I/We John A. Collins . of P.O. ’ Joy. 887j Grand Cayman hereby declare that the -- Cr.s--share (•} in Coral Seef Securities Limited now standing in my name in the books of the said Company was /were jparchasad or provi ded out of moneys belonging to T. J. McLaughlin &/or Barbara Breen for the of thie sur"vi-v or ■ ° f 41 Waterloo Lano, Dublin 4, Ireland (hereinafter called "the Owner") and is/are now Held by me/us as nominee for the said Owner. ’. •• *• . '' \ '.’ U• ‘' (AMILTON RO: J L . > 0 /0 2 /9 3 >9/03/93 0 9 /0 3 /9 3 BROUGHT FORWARD TO CALL J 9 /0 3 /9 3 J 9 /0 3 /9 3 )9 /0 3 /9 3 0 9 /0 3 /9 3 0 9 /0 3 /9 3 0 9 /0 3 /9 3 R EPA ID RELODGED REV ENTRY 1 9 /0 3 /9 3 1 9 /0 3 /9 3 0 9 /0 3 /9 3 0 9 /0 3 /9 3 IN TER EST In t e r e s t to 3 1 /0 3 /9 3 \ ________ 0 9 /0 3 /9 3 ANSBACH ER LIM ITED P.O. Box 807 Grand Cayman British W est Indies Telephone No. 9— 4653/4 Telex C P 305 Cable Address Guinness A/A'IOA ACCOUNT NUMBER 80001107 page BALANCES SHOWN ARE IN: sterling 353240.7D 89185.39 270000.00 270000.00 4376.80 5944.61 4376.80 ?Wigwam 34/01/93 08/12/92 31/01/93 BROUGHT FORWARD LODGED CARRIED FORWARD } ANSBACHER LIM ITED P.O. Box 887 Grand Cayman British W eal Indies Telephone No. 9— 4653/4 Telex C P 305 Cable Address Guinness A/AK’IA ACCOUNT NUMBER 00001107 PAGE BALANCES SHOWN ARE IN: s t e i 'l i l i g IJ.00 353240.78 I Wat i SSTATIMEmTQF ACCOUNT! Ansbacher Limited Cayman L J ht KfiHipnofv' 30/11/92 8/12/92 10/12/92 10/12/92 LO/12/92 BROUGHT FORWARD 8/12/92 8/12/92 8/12/92 8/12/92 In t e r e s t to REPAID DELODGED INT ADJ 8/12/92 > ANSBACH ER LIM ITED P.O. Box 887 Grand Cayman British W est Indies Telephone No. 9— 4653/4 Telex C P 305 Cable Address Guinness A/A10A ACCOUNT NUMBER 80001107 PAGE BALANCES SHOWN ARE IN: sterl il’ig 8592.61 23 344640.18 353240.79 353240.78 353240.78 0.01 V at; Afisbacher L im ite d i.’ayman L -REtjf FIIPTIPN /92 1/10/92- 30/ 9/92 BROUGHT FORWARD REVERSAL > ANSBACHER LIM ITED P.O. Box BB7 Grand Cayman British W est Indies Telephone No. 9 — 4653/4 Telex CP 305 Cable Address Guinness A/AH'M ACCOUNT NUMBER 00001107 PAQE BALANCES SHOWN ARE IN: s ter 1 0 .00 344648.10 26/02/94 09/03/94 09/03/94 09/03/94' 28/03/94 09/03/94 09/03/94 09/03/94 09/03/94 BROUGHT FORWARD RELODGED REPAID TO CALL D/A INTEREST ACCOUNTNUMBEH 30001107 PAGE 6 BALANCES SHOWN ARE IN: 1211 ing 200000.00 200000.00 84597.85 196919.70 3080.30 200000-00 Appendix I, 30/11/93 09/12/93 09/12/93 09/12/93 31/12/93 _ ______ 09/12/93 09/12/93 09/12/93 BROUGHTFORWAHD REPAID RELODGED Interest to 09/12/93 A/A]OA ACCOUNT NUMBER 00001107 PAGE BALANCES SHOWN ARE IN: ster 1illg 277624.16 281517.55 281517.55 3893.39 f> Appendix; I IAMILTDN liOSS J L. 31/08/93 09/09/93 09/09/93 09/09/93 09/09/93 09/09/93 09/09/93 BROUGHT FORWARD REPAID KELODGED Interest to 09/09/93 ) ANSBACHER LIM ITED P.O. Box 887 Grand Cayman British W est Indies Telephone No. 9— 4653/4 Telex C P 305 Cable Address Guinness A/AlOA ACCOUNT NUMBER 80001107 PAGE BALANCES SHOWN ARE IN: s te r lin g 273743.0) 277624.16 277624.16 31181.15 277624 . Ji. 4 L 11/05/93 19/06/93 J9/06/93 19/06/93 J 09/06/93 09/06/93 09/06/93 1HOUGHT FORWARD RELODGED Intei'est to 09/06/93 y ANSBACHER LIM ITED P.O. Box 887 Grand Cayman British W est Indins Telephone No. 9 — 4653/4 Telex CP 305 Cable Address Guinness A/AJ.0A ACCOUNT NUMBER 80001107 pAQe siierlin ^ BALANCES SHOWN ARE IN !70000.00 273743.01 273743.01 3743.01 ir/.T/O M . l i i jHAMIi L _ v!' 31/08/94 16/09/9*1 o 30/09/9-1 ^.. .— 07/09/94 j’1/? BROUGHT FORWARD I n te re s t to 07/09/94 > h ;%I0~t\ ACCOUNT NUMBER 8000110? PAGE BALANCES SHOWN ARE IN: s ter 1 i ng 2021 50.'!4 220 A.96 20435& .:i(i - HAMILTON ROSS L _ PESrF)iPTID(-J il/0 5/94 20/06/94 20/06/94 20/06/94 BROUGHT FORWARD 00/06/94 08/06/94 00/06/94 INTEREST RELODGED REPAID ACCOUNT NUMBER 80001 107 PAGE .7 BALANCES SHOWN ARE IN: sterlin' 2150.34 202150.34 202150.34 ) > [HAM.lI/roN ROKS A/AJOA ACCOUNT NUMBER 00001107 PAGE BALANCES SHOWN ARE IN: s te r lin g DESCRIPTION ‘ A . )/(1‘»/* i‘» ' 11/ .11)/'-.»5 il/ ln / ";;, 11 ;iu BROUGHT FORWARD 24/10/95 31/10/95 In t e r e s t to 24/10/95 TO CALI. 101495.G9 1455.01 102950.90 )1 - Appendix NT OF ACCOUNT ; 1HAMILTON Tan ROSS L _ Bg^GRlPTION M O /06/95 VO/117/05 V.fi /.i 17/ ‘VS BROUGHT FORWARD 25/07/95 25/07/95 25/07/95 REPAID RELODGED I n t e r e s t to 25/07/95 V ) ACCOUNT NUMBER 80001107 PAGE BALANCES SHOWN ARE IN: S t e r 1in g 10 ~balance (iL : 100000.00 101495.09 101495.09 1495.89 101495.09 ____ _J I 11 / 0 J / 9 r> •(‘•/'Vi/yfi ;i i /< i'. / ' ) ri ,, ’ 25/04/95 25/04/95 BROUGHT FORWARD INTEREST TO CALL CARRIED FORWARD i ACCOUNTNUMBEH 90001107 PAGE BALANCES SHOWN ARE Step 1 111g 204355.30 4861.36 109216.66 100000.00 BROUGHT FORWARD 30/11/95 REV ENTRY 30/11/95 Interest to 30/11/95 0 FORWARD ACCOUNT NUMBER BALANCES SHOW :3 .J: ARE IN: ?(F?Urn? 80001107 PAGE 1 2 0.00 L _ ,'DESCRIP.TIC l\l 31/03/97 16/04/97 16/04/97 16/04/97 16/04/97 BROUGHT FORWARD TO CALL Interest to 16/04/97 ■ o o ACCOUNTNUMBER 00001107 PAGE BALANCES SHOWN ARE IN: s t e r 1in g BAL'AKCE 400000.00 411468.49 11468.49 14 Lair y? auxin/91.. BROUGHT FORWARD FRDH CALL . CARRIED FORWARD . 1 "?ii ACCOUNTNUMBEH 30001107 PAGE 13 BALANCES SHOWN ARE 1N: sterl ing . A ?x 400000.00 i 400000.00 A R T H U R C O X HaKI.^I:ORT Cl-NTlil:, l:.\KI.£K)KTTHRRACFI, Dl’HUN 2 Till. +-353 !M S 0000 Fax +353 I hLSOMS Dx 27 Dibun inaiI(f_f-arllmrcox.com hUp://\vww.artliurcox.com Bi.u-AjT Lunik)N Nhw York 5loKi-:?Hni1ji;,17-25Cm ;k.i:5gi•\klI* i 20l.lIHiAII IIIII 570l.l-XINGTONAVHNlh,28THFlR NewYork,NY 10022 Hihas" HT! <>i!() London HC4M 7 1: i!;nioM +442£002.3D007 Tu.iii’iiom +44 2072131)450 Ti-i.mioni:+1 2127590808 Fax+442$i)()233404 I-\x+442072130455 Fax+1 2126883237 AXC/as 18Ul December, 2001 ‘ The Inspectors Third Floor Trident Houss Blackrock Co. Dublin Re : Thomas J. McLaughlin Deceased Your Reference : C/M10/MSPM Dear Sirs, We acknowledge receipt of your correspondence dated 3rdDecember, 2001, addressed to Paul McLaughlin of this office in his capacity as executor of Thomas J. McLaughlin Deceased. We have copied this correspondence to the other executors, Paul Carty and Jack Stakelum. Having considered your correspondence, it is submitted that the concise nature of the Inspectors’ Preliminary Conclusion could unnecessarily give rise to inferences adverse to the interests, good name and reputation of the late Mr. McLaughlin. This is because it is not clear from your document that the fund entrusted to Mr. Traynor had been provided from after tax gains and also from income which was exempt from tax. Furthermore, it is not recorded that Mr. McLaughlin deceased was unaware that the fund had been invested by Mr. Traynor in Ansbacher. This information was provided to the Inspectors in the correspondence dated 19th December 2000 from Anne Corrigan of this office, which letter the Inspectors relied upon in supporting their conclusions. We would request therefore that the position be clarified by the insertion of the following to the Inspectors’ Preliminary Conclusions after the words “Hamilton Ross” : “It was submitted that the fund in question was provided by Mr. McLaughlin from after tax gains and tax exempt income. It was asserted on Mr. McLaughlin’s behalf that he had no knowledge that the sum of money he entrusted to Mr. Traynor had been placed on deposit with Ansbacher until after Mr. Traynor’s death. It was further submitted that when Mr. McLaughlin became aware of this in 1998, he took steps to have the fund repatriated to Ireland, and made contact with the Revenue Commissioners on a voluntary basis to ensure that any relevant taxation liability in relation to the interest earned on the fund was discharged. ” Jamks O’DvnTR P\li MiI.aioim.in I\xA.Scon Damh I-.O'Connor Pi-hr MtL\i\iin.ts Router Roi.rox John V.O'Dvtyer Ronam Walsh Donchjh Crowley John S.W’aisii Micn\t;i.Mk ;iii:\ Josl.imi Livdi n YTiiiiam Johnston Flc.lnl MlCac.li; Nicholas G. Moori; Di-clan Hayks David O'Donohoh Colm Dic.gan Cahi.O'Sit.i.ivan Foi.lv John Mrvni: Covok McDon'mli. Patrick McGovkrn Grainni:Hfnnkssy Si-amis Given Colin Byrne Caeoijm.Dlviin Ci\ranI»oioi-KGki«.:ii\Mi-ncon P\tkick O'Briln Ori\O'Connor Bki\n O'Gorman’ Mark Satndtrs Mark Barr John Matson Dekoraii Spence CO\S(ITANT5: VlNUiNTWu.SlI DliNISJ.BlROIN ClIITWODI:HAMILTON NlAlI.MtI.AIC-III.IN DR.Y\ONNI:SCANNHl.1. DK.RoULRTCURK JOHNG.FlSIl Dr.MARYREDMOND We should be grateful if you would consider our submission and amend the wording of your Preliminary Conclusions accordingly. Yours faithfully ARTHUR COX Appendix XV (79) Mr Colm McLoughlin 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Colm McLoughlin. a) Affidavit o f Mr Colm McLoughlin dated 16 January 2002. b) Transcript o f evidence o f Mr Ray McLoughlin dated 13 September 2001. c) Transcript o f evidence o f Mr Maurice O’Kelly dated 10 April 2000. d) Transcript o f evidence o f Mr Martin Keane dated 16 February 2000. e) Undated handwritten memo re Selima Investments. f) Internal Guinness and Mahon loan memo o f 11 April 1984. g) Memo o f 11 September 1984 - Pat O’Dwyet to Brendan Donnelly. h) Guinness and Mahon confirmation o f loan reversal o f 17 September 1984. i) Internal Guinness and Mahon memo o f 1 October 1984 - Pat O’Dwyer to Maurice O’Kelly. j) Internal Guinness and Mahon memo o f 18 October 1984 - Pat O’Dwyer to MJ Pender. k) Internal Guinness and Mahon file note o f 14 December 1984 signed by Mr Pat O’Dwyer. 1) Memo o f 26 March 1985 - Mr Ru Leonard to Mr Brendan Donnelly. m) Notification o f share transfer o f 18 May 1985. n) Letter o f 28 May 1985 - Guinness and Mahon to Dewdrop Investments Limited. o) Letter o f 4 September 1985 - Guinness and Mahon to James Crean Limited. p) Letter o f 14 January 1986 - RJ McLoughlin to Guinness and Mahon. q) Note to Mr Pat O’ Dwyer from Mr Ray Me Loughlin dated 14 January 1986. r) Internal Guinness and Mahon ?le note of 15 January 1986 signed by Mr Martin Keane. AFFIDAVIT In the matter o f the Ansbacher Inspectors and in the matter o f the preliminary conclusion reached in relation to Ray McLoughlin. I, Colm McLoughlin, o f Villa #46, A1 Gharhoud, Dubai, United Arab Emirates, (P.O. B ox 8652) Company Director aged 18 years and upwards make oath and say the following to be true from facts within my knowledge or otherwise to the best o f my knowledge and belief: 1. I have been resident outside o f Ireland for 27 years o f my working life. currently a resident o f Dubai in the United Arab Emirates. I am 2. I am a brother o f Ray McLoughlin. I have read the preliminary conclusions o f the Ansbacher Inspectors in relation to Ray and I am surprised that the Inspectors do not accept his evidence in relation to the beneficial ownership o f Selima Investments Ltd and Dewdrop Investments Ltd. 3. I visited Ireland from Dubai in 1984 and I discussed and agreed with Ray that I would buy 350,000 shares in James Crean pic for my own account. Ray was very keen that I would buy the shares as he was in favour o f getting friendly parties to acquire and build up shareholding positions in Crean. 4. Guinness & Mahon arranged a Cayman Island company (SELIMA) for m y benefit and Selima borrowed the money and acquired the 350,000 shares. Ray negotiated the loan on my behalf and the formalities and paper work were handled by Guinness & Mahon. Guinness and Mahon were aware that I was the principal behind Selima Investments and the Crean share transactions because it was they, through the late Des Traynor who arranged Selima for me. Ray did not acquire any beneficial ownership in Selima or the 350,000 shares at that time or subsequently. 5. I carried out business through Selima only for a relatively short period o f time. At my request the shares and borrowings were transferred from Selima to Dewdrop in 1985, a company formed for my benefit also by Guinness & Mahon. Ray did not acquire any beneficial ownership in Dewdrop or in share transactions carried out by Dewdrop at that time or subsequently. 6 . I continued to build up a position in Crean through Dewdrop, and Dewdrop repaid its borrowings from Guinness & Mahon some years later. I trust that the Inspectors w ill correct the incorrect preliminary conclusions which they have reached in relation to my brother Ray. Sworn by the said Colm Mcloughlin In the presence o f And I know the deponent uwwoC- Dated this 16th o f January, 2002 Appendix UNDER OATH ON THURSDAY, 13TH SEPTEMBER 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: JUDGE SEAN O'LEARY MR. MICHAEL CUSH SC MS. NOREEN MACKEY BL Accountant to the Inspectors MR. THOMAS SLEVIN Interviewee: MR. RAY McLOUGHLIN Represented by: MR. BILL SHIPSEY SC Instructed by: MR. HAUGHTON FRY (SOLICITOR) 1 2 3 4 JUDGE O'LEARY: Thank you very much for 5 attending, Mr. McLoughlin, 6 we appreciate it greatly. 7 MR. SHIPSEY: Judge, just before 8 9 10 Mr. McLoughlin is sworn...(INTERJECTION) JUDGE O'LEARY: 11 Well I presume he is already, 12 treat him as already sworn. 13 MR. SHIPSEY: 14 I am going to Very good. My very recent suggestion, Mr. McLoughlin 15 make contact with his brother, who is based in the 16 Middle East, but who actually has been travelling 17 over the last while in South America. 18 through to Mr. McLoughlin yesterday and I would just 19 like to give it to you, it is from the Sheraton Rio 20 Hotel and Towers. 21 copies of that. 22 JUDGE O'LEARY: 23 He sent a fax If I could just give you some We might find it difficult to contact 24 Mr. McLoughlin in the Sheraton Hotel. 25 MR. SHIPSEY: I think you will. 26 JUDGE O'LEARY: He is a bird of passage in 27 28 29 that location, I think. 1 Dubai. 2 3 that, okay. 4 MR. SHIPSEY: Very good. 5 JUDGE O'LEARY: Yes. 6 7 Well I think this is in accordance with what Mr. McLoughlin has indicated to us. 8 9 10 MR. McLOUGHLIN, HAVING ALREADY BEEN SWORN ON A 11 PREVIOUS OCCASION, WAS CROSS-EXAMINED BY THE 12 INSPECTORS AS FOLLOWS 13 14 JUDGE O'LEARY: Thank you very much 15 indeed, Mr. McLoughlin 16 for your attendance here today. We appreciate it 17 greatly. 18 by the Inspectors but that really related to that 19 famous document note to John Furze. 20 no further questions to ask you about that. 21 really is as, I will not say a dead issue but it is 22 not an issue which we need concern ourselves about 23 much since we have heard your explanations on that. 24 This is a different matter altogether. 25 dealing here with a question of who, if anybody, 26 were clients of a company we are investigating. That 27 company is Ansbacher. 28 Cayman, Ansbacher, it was also called Guinness Mahon 29 Cayman Trust and various names. It had various We know that you were already interviewed Really we have That We are It was called Ansbacher 1 names. So that is the purpose, if you like, of 2 today's exercise. 3 4 We have been instructed by the High Court to 5 establish who the clients were. I think you know the 6 Inspectors. 7 present at the first interview and insofar as in the 8 course to the extent that any decisions are 9 necessary in respect of that interview only those There is Ms. Mackey, who was already 10 people who were Inspectors, at that time, will 11 participate in that portion of the decision, nothing 12 to do with me at all. 13 14 Mr. Cush is a recently appointed Inspector with 15 myself, when I say recently now, 12 months ago, and 16 my name is Sean O'Leary, 17 There is a fourth Inspector, Mr. Paul Rowan, but he 18 is not here this morning. I am another Inspector. 19 20 As you anticipate indeed from the letter which you 21 got from your brother, the purpose of this exercise 22 is to try and establish once and for all whether a 23 company and a series of transactions relating to a 24 company called Selima, whether that indicates that 25 any person, including a company, when I say a 26 person, was a client of Ansbacher. 27 purpose of the exercise. In fact, very often when 28 people come in, we are dealing with the same thing 29 as we dealt with twenty different times previously. That is the 1 This is a rather different situation. 2 has importance from the point of view of the type of 3 service which the company appears to have been 4 providing for people out of Ireland. 5 significance also. So it is along those lines we 6 would like to go. So it also That has some 7 8 First of all, could I ask you, because I am a little 9 bit confused about your brothers, how many brothers 10 11 have you that are relevant to this? A. There is only one. I have two brothers altogether, 12 Judge O'Leary, my brother Phelim lives in the UK, my 13 brother Colm lives in the Middle East. 14 1 Q. The problem with Phelim is that while he has nothing 15 to do with Selima, the borrowings that commence with 16 Selima and end up seem to incorporate Phelim 17 eventually. 18 will to that later. So there is Phelim and there is 19 Colm; is it? 20 A. 21 2 Q. 22 A. 23 3 Q. 24 He seems to come into the picture. We They are my two brothers. Colm is living in the Middle East, you say? That is right. You see as a result of what Colm says we may want to contact Colm, do you have an address for him? 25 A. 26 4 Q. That is no problem at all. 27 5 Q. MS. MACKEY: 28 29 Yes, I do but I don't have it with me. There is a PO Box on this 1 6 Q 2 is that it, Dubai? 3 A 4 7 Q 5 A 6 8 Q 7 8 Yes . Would that be the normal place to contact him at? It would be. Have a look at it there now and see whether you think that is right? A 9 I think it is. that is it. 10 It is a PO box number and I think Most of my communication with him would be by fax or by phone. 11 9 Q 12 A 13 10 Q I understand that, of course, yes? You can take it that that is right. I think most people in Middle Eastern countries like 14 that use post office boxes rather than, we will say, 15 ordinary postal address. Now what you might do is 16 you might check whether -- and convey through your 17 solicitor, whether that is, in fact, the best way to 18 contact him? 19 A 20 11 Q Right. Obviously if we accept what he says there we may 21 have to contact him and that is the reality of life, 22 because he may or may not then be a client within 23 our definition. 24 will have to consider in due course, that is number 25 1. 26 he and have you got his address? 27 28 29 A Your brother Phelim then, he is in England, is I have indeed. Yes? That is that is a matter which we 1 13 Q. That is right. There is no problem about giving us 2 any kind of information like that afterwards, okay, 3 right. 4 A. 5 14 Q. Thank you very much. Okay. Now what I have done is that we got certain 6 documentation from Guinness & Mahon and that 7 documentation we have put in date order to the best 8 way we can and I intend going through that 9 documentation with you and asking you questions 10 about it. 11 document that you have not seen before. 12 there is no problem at all, you can discuss the 13 matter with your solicitor and barrister, there is 14 no difficulty in that at all. 15 adjourn at any time to discuss it with him, just 16 tell us you want to adjourn it. 17 solicitor or barrister feel it is appropriate for 18 you to adjourn to discuss the matter, all they have 19 to do is say to us look we would like to discuss 20 with our client and we will withdraw. In addition to 21 that we will have a break for tea of coffee at a 22 convenient time and the thing is very relaxed in 23 that way. There is only two formal aspects of the 24 matter. One is we must swear you but as you are 25 already sworn and do you remember that you are 26 already sworn? 27 A. 28 15 Q. 29 I do not think there is anything in the If there is If you want to Similarly if your I do indeed. You are still sworn as far as this is concerned. The 1 eventually. 2 All right. I have prepared a file of the documents 3 that I will be showing to you and it is that blue 4 folder there. 5 It might be handed over to Mr. McLoughlin. 6 think there is any document in it that you do not 7 know about already. 8 A 9 16 Q That is also provided for in the Act. You might just have a look at that. I do not Would you like me to look through it now. Not at all, I will go through it and if you want 10 time to look at any particular document, of course 11 say it to us, there is no difficulty at all. 12 the first document really is probably something you 13 know nothing about at all (Exhibit 1). It is an 14 internal GMI, I say GMI, Guinness Mahon Ireland, an 15 internal GMI document. 16 a note about the borrowing of £460,000. 17 remember the borrowing of £460,000 to buy shares? 18 A 19 17 Q 20 A 21 18 Q 22 A Now It's significance really is Do you Yes, I do. Do you remember the circumstances surrounding that? Yes, I do. And what were they? My brother Colm decided that he wanted to buy some 23 Crean shares. 24 this company to buy them through and he sought a 25 borrowing from Guinness & Mahon to fund the purchase 26 and that is what this £460,000 is about. 27 19 Q Yes, and did you negotiate it on behalf of your brother? 28 29 Guinness & Mahon provided him with A Yes. I was the principal communicator on this loan 9 1 2 20 Q 3 A So do you remember the date? Well other than -- I have seen it in the Guinness 4 Mahon file but I wouldn't otherwise remember it. 5 this moment I can't quite remember but I think it 6 was -- would it have been 11th April? 7 21 Q Yes, I think if you look at the second document you 8 will see that 11th April was their approval date. 9 The second document (Exhibit 2). You see down at 10 the bottom of these documents there are numbers, 11 they come from a different file that we have and 12 that is 109, do you see down, at the very end. 13 A 14 22 Q At Sure . You can see that is 11th April. So it appears to 15 mean that the document 105, which I have previously 16 referred to, the first of the documents, predates 17 11th April by some short period in time. I think it 18 is a preliminary note of some kind. I do not see on 19 that document anything about who their client was, 20 accept the shares are in a company called Montoire 21 M-O-N-T-O-I-R-E Limited? 22 A 23 23 Q 24 A Yes . Do you know anything about that company? Montoire was a nominee company used by Guinness 25 Mahon in Guernsey. 26 and it was used as a nominee holder of these shares 27 on behalf of Selima. 28 29 It is a Guinness Mahon company 1 All right. Excellent. 2 page, which is page 109, you will see that this is 3 an internal GMI document. 4 does not seem to suggest who the principal of Selima 5 Investments is. 6 the principal of Selima Investments was? 7 A Yes, I did. 8 26 Q Who was it? 9 A 10 27 Q 11 12 If you look at the second Now, funnily enough it Did you know, at that stage, who My brother Colm. Do you know whether Selima Investments, is that a Channel Island or a Cayman company? A I do, well, to the best of my knowledge and belief, 13 I am 99 percent sure it is a Cayman Island company. 14 It was presented as such. 15 28 Q In fact, if you look at the first document, you will 16 see that the first document, at page 105, has GMCT 17 reference on it. 18 taken out by a punch button, GMCT post office box; 19 you see that? 20 A 21 29 Q 22 You see "care of" seems to be Yes . If you like, that is the thing that highlighted it as far as we are concerned? 23 A 24 30 Q Yes . So that is grand. That is very helpful indeed. So 25 really I have nothing else to say to you about 26 page 109. 27 page 107 because this came from a different file and 28 the numbers may not be in strict sequence 29 (Exhibit 3). I have tried to put them in date order If you look at the third page, which is 1 rather than in sequential order. You will see that 2 it is Selima Investments, Guinness Mahon Limited 3 account details, you can see that. A borrowing a 4 principal of £486,000. 5 contract date and the significant thing, as far as 6 we are concerned, because we are only interested in 7 things which are relevant to us. 8 Investments Limited, Post Office Box 887, Grand 9 Cayman, British West Indies. 10 It is 14th April 1984 is the It is Selima You can see that down on the left-hand, Mr. McLoughlin? 11 A 12 31 Q 13 A 14 32 Q Yes . That actually is Ansbacher's address? Yes . We concluded from that, on a preliminary basis, that 15 it was an Ansbacher related company on the balance 16 of probability. 17 is not right? 18 A 19 33 Q You have no reason to suppose that I have no reason to suppose that is not right. That is fair enough. That, if you like, is the 20 basis of our investigations. The next page which is 21 111 in terms of numbers is just a dealing ticket 22 from Davy's or something along that line 23 (Exhibit 4), I do not know what they call. 24 a note of the actual purchase. 25 particularly significant about it accept it is there 26 for the sake of completeness, all right. 27 confirms that the number of shares were £350,000, 28 all right? 29 It just There is nothing It 1 If you look at 113 (Exhibit 5), which is the next 2 page, this has some significance because it is six 3 months after the original transaction. 4 September 1994 and it says: 5 change the name of the account to Montoire Limited 6 and that is a Surrey address. Then there are various 7 other details which really are of no concern to us. 8 You see written along the bottom by GMI, Montoire 9 Limited at the bottom, on the right-hand side. Do The 11th Please arrange to 10 you remember the circumstances in which that change 11 was made? 12 A No, I have looked at this documentation in 13 preparation for this meeting, as you can imagine and 14 I have seen that and I don't know what that means. 15 As far as I am concerned Montoire was a nominee 16 holder for Selima for as long as it existed and I 17 don't know what that particular one was. 18 35 Q I think what they are trying to convey there, 19 Mr. McLoughlin, is Montoire was always the nominee 20 holding company of the shares but they are talking 21 here about the borrowing? 22 A 23 36 Q Yes, I can see that. He changed the name of the above account. They are 24 talking now about the account now which is a 25 different matter altogether. 26 A 27 37 Q Sure . Do you remember the circumstances? 28 I do not. 29 that kind. I have no recollection of any change of 1 38 Q 2 A 3 4 It is odd because Montoire is Guinness Mahon company. 39 Q Is a Guinness Mahon company. Yes and, in fact, there 5 could be merit in what you are saying because 6 ultimately when that happens another company, by the 7 name of Dewdrop, comes into the reckoning. 8 know, they do not seem to have done that. They seem 9 to have ultimately transferred it to a company You 10 called Dewdrop. We will see about that in due 11 course? 12 A 13 40 Q Sure . All right. If you look at the next page you will 14 Selima Investments Limited which is page 115 15 (Exhibit 6). The reason that I am giving those 16 numbers is that my colleagues here have had the 17 original files which relate to other matters 18 altogether. 19 can see them. You see the only purpose of me putting 20 that in is that you can see that the address for 21 Selima Investments Limited is the same post office 22 box in Grand Cayman? 23 A 24 41 Q I am giving those numbers so that they Sure . Other than that it is a matter of no concern. We 25 come to 117 which is an internal memoranda of 26 Guinness Mahon of 1st October 1984 27 you seen that document before, Mr. McLoughlin? 28 29 A I have. (Exhibit 7), have 1 you will appreciate. Have you any comment to make on 2 the document first before I ask you any questions? 3 A. 4 43 Q. 5 6 A. I don't recall that, but it could well have happened. 44 Q. 9 But would it not have been an extraordinary thing, Mr. McLoughlin for you to guarantee a loan for your 10 11 Well, first of all, it says that you had been asked to guarantee the loan; is that true? 7 8 Not really. brother. A. 12 I think it wouldn't be in the least bit extraordinary, Judge O'Leary. 13 45 Q. 14 A. Would it not? No. I have guaranteed or helped out financially many 15 people in my life time who were less connected to me 16 than my brother was. 17 46 Q. Yes, but I don't get the impression, Mr. McLoughlin, 18 from that your brother that he was in position, at 19 that stage, where he needed much assistance because 20 he and, of course, I understand we would all do that 21 for our brother if we had to, but if we take your 22 brother's letter to be truthful and I have no reason 23 to suppose it is not, you have appended it yourself, 24 he says: 25 26 27 28 29 "During a visit to (INAUDIBLE) I decided to buy James Crean shares, 350,000. I decided I wished to acquire a company in a tax (INAUDIBLE) location to carry out this purchase and arrange it then." 1 door. 2 in a company which might or might not prosper and 3 which might or might not show a profit. Now to seek 4 a guarantee from your brother, in that situation, is 5 rather unusual; is it not? 6 A. He was making a voluntary decision to invest I would say not based on my experience of dealing 7 with banks, Judge O'Leary, lenders are looking for 8 additional collateral all the time and they will 9 look for it for wherever they think they will get 10 11 it. 47 Q. I see. I do not think anyone could deny the accuracy 12 of that statement, Mr. McLoughlin, anybody who has 13 been around at all. Now if you look at the last part 14 of the memo however the matter assumes some 15 different significance. 16 It says: "He mentioned to me..." 17 18 He, now being Ray McLoughlin, he mentioned to me 19 that he would like to give the question of the 20 guarantee some consideration as there was a distinct 21 possibility he may repay the loan in the near 22 future. What does that mean, do you think? 23 A. 24 48 Q. I really don't know. Would it be fair to say this and I'm not saying that 25 it is a truthful assumption; would it be fair to say 26 that the person writing the memo thought it was, in 27 fact, your loan? 28 29 A. I would not necessarily accept that, Judge O'Leary. 1 what takes place between a banker and a borrower 2 based on my experience. This could have been a typo. 3 It could have been an error in transcription or on 4 recording on the part of Pat O'Dwyer. My experience 5 of file notes, trying to summarise five or six lines 6 what could have taken 15 or 20 minutes, over the 7 phone suffers from inaccuracy inevitabilly. I could 8 have said, for example, I will discuss it with my 9 brother and I feel there is a possibility he will 10 repay it in the near future. 11 of these things but I can think of many, many 12 reasons why that could creep into a file note when, 13 in fact, it does not reflect the reality. 14 49 Q. I don't remember any Yes, but would it be a fair thing to say that if it 15 does reflect the reality, if it does and I know you 16 don't accept it does, I have to, of course, give 17 appropriate weight to that and the other Inspectors. 18 When I say I, I mean the four of us. 19 if it does reflect the, reality it does mean that it 20 was your borrowing. 21 what you had with them, it would lead on the balance 22 of probability to the conclusion that it was your 23 borrowing? 24 A. The reality is If that was an accurate note of Well, not necessarily, I could have said that for 25 all kinds of other reasons but I don't recall this 26 meeting at all and know nothing about that meeting 27 until I saw the file note. 28 29 50 Q. And you will appreciate that my concerns, I don't care anything about James Crean, it is a matter of 1 no concern, as far as I am concerned, but if my job 2 and our job is to identify who the clients are, 3 right, we have to be satisfied that in reality it 4 was your brother was the client and not you. 5 A. 6 51 Q. True, I understand. We do not want to name your brother as the client 7 if, in fact, you are the client. 8 purpose of going through all this. It's effect on 9 James Crean is tangental, as far as I am concerned; 10 So that is the do you understand that? 11 A. 12 52 Q. Yes. Now, right so we will leave that, I have heard what 13 you have said about that. 14 misunderstanding or anything else Pat O'Dwyer had, 15 it seemed to last until 18th October, because if you 16 look at the next page, page 119 in the standard file 17 (Exhibit 8), it says: 18 know what we have said about that, it is the same 19 borrowing anyway: 20 Now, whatever "Montoire Limited". "You may recall it was agreed that Ray McLoughlin should give his guarantee to cover the above borrowing. To date I have not received the guarantee in question. He has, I think, to discuss the matter with Maurice O'Kelly. Should I write to him forwarding a guarantee for completion and return." 21 22 23 24 25 26 Do you remember that? 27 A. 28 53 Q. 29 A. No. Do you remember anything about it at all? No. Again, I 1 54 Q. If you look at the following page, which is 121 2 (Exhibit 9). 3 apparently, at this stage. 4 change that your brother refers to. 5 loan offer. 6 have really no questions about it other than to tell 7 you that the document is there, do you understand? 8 A. 9 55 Q. The borrower is Montoire Limited, This is implementing the This is just a There is nothing dramatic about it. I Yes, sure. I mean I have no -- there is nothing magical about 10 it. 11 If you look at the next page on that file that I 12 have given you, page 124 (Exhibit 10), again it is a 13 Pat O'Dwyer, 14 this. 15 same money though, whether he is calling it Selima 16 or Montoire, this really is the same borrowing. 17 Then he says: 18 substitution. 19 It is just part of the routine, if you like. "POD", appears to be the origin of Again he is now talking Montoire. It is the "Facility letter" even though it is a "Facility letter issued on 23rd October." 20 21 That is the one we have looked at: 22 "I await receiving a copy of authorised signatures, bold resolution, blank transfer, power of sale and guarantee of Ray McLoughlin and this loan may have been the subject of further discussion with Ray McLoughlin, in the meantime however my security remains incomplete." 23 24 25 26 27 Now do you know anything about that? 28 A. 29 56 Q. What was the question? Do you know anything about the fact that when the 1 loan was to be substituted from the name of -- from 2 it's earlier name to Montoire Limited that there was 3 a suggestion that you would give a guarantee? 4 A. 5 57 Q. 6 A. 7 58 Q. I have no recollection of that. That is the question, do you remember that? No, I don't . If you look at the next page, page 126 (Exhibit 11), 8 all that is is a limit updating. 9 the borrowing was transferred into Deutsch Marks, at It appears that 10 some time and that is only just a note of it. 11 is nothing of any particular significance there but 12 it is there for the sake of completeness. 13 the next one has some significance 14 Again it is January '85. 15 almost eight or nine months after the original 16 borrowing and a few months after Montoire became the 17 account. 18 Limited" and that is one of their standard notes on 19 what the account was. 20 address which was given which presumably was the 21 correct address for Montoire, and somebody within 22 the organisation, now this is an internal document 23 has crossed out Montoire and put Dewdrop Investments 24 Limited. If you like, the sequence of events is 25 Selima, Montoire, Dewdrop Investments. As you say 26 Montoire is only a company for holding shares and 27 securities and that sort of thing. Dewdrop 28 apparently were the people that were doing the real 29 borrowing. There You see (Exhibit 12). We are now talking about You can see account name: "Montoire You can see there that the Do you know anything about Dewdrop 1 2 I do, but before it might be marginally helpful to 3 point out that based on the Guinness Mahon file I 4 got, Dewdrop didn't seem to come into existence 5 until, I think, it was March 1985. 6 59 Q 7 A That is correct. This suggests to me, therefore, that later in the 8 day this hand written note was written, later in the 9 day, by way of correction of an 10 11 earlier...(INTERJECTION) 60 Q 12 It really does not matter whether it was done in January or March? 13 A 14 61 Q Sure . It does not make any difference. I am not hung up 15 on that document. 16 document over and go on to later documents. 17 forget that. 18 A 19 62 Q I am quite happy to pass that Let us Sure okay. Do you see 26th of March. In fact, I think if you 20 look at 4th or 3rd next page you will see that we 21 have a Certificate of Registration of Dewdrop, which 22 is 14th March 1985 (Exhibit 15). 23 happy to forget everything before that which I am 24 not concerned about. If you look at page 129 25 (Exhibit 13), at the bottom, which is immediately 26 after that last one we looked at, you will see that 27 this reflects, 28 situation appears to have been: 29 So I am quite I think, what the reality of the "The borrowing in the name of the above: Montoire has been switched to 1 2 3 All right, so that is grand. 4 some money on deposit in anticipation of interest. 5 I am not really concerned about that. 6 really concerned about the details of this, I am 7 only concerned about the ownership. 8 not of any great relevance. Now who owns Dewdrop or 9 do you know anything about Dewdrop? 10 A. 11 I am not The details are Yes, I do. Dewdrop was a company in Colm's ownership which was provided for him in 1985. 12 63 Q. 13 A. 14 64 Q. 15 A. 16 Apparently they held 65 Q . 17 A. 18 66 Q. 19 A. 20 67 Q. 21 A. 22 In whose ownership? Colm, my brother Colm. In Colm's ownership? Yes. I see. The letter from Colm points out (Exhibit 43). Yes, at paragraph 4, I think? That he...(INTERJECTION). You might read that just for the record? Sure. From Colm's letter he says: "About a year later I decided that I wished to conduct my affairs through the Channel Islands rather than the Cayman Islands and Guinness Mahon arranged a company for me in the Channel Islands called Dewdrop Investments for this purpose. Following that, I arranged the transfer of all the assets and liabilities of Selima to Dewdrop." 23 24 25 26 27 28 29 68 Q. So Dewdrop was is a company probably, I know the way 1 2 A. 3 69 Q. 4 That is my understand. Yes, I understand. Did you have any interest in that company? 5 A. 6 70 Q. No. Now if you look at the next page, page 131 7 (Exhibit 14), that is only just practical 8 confirmation that what was said was to be done was, 9 in fact, done. 10 A. 11 71 Q. Do you see that? Yes. It has an address in Guernsey which I think is 12 Colleague Trustee's address. 13 there, do you? 14 A. 15 72 Q. 16 Do you see it down Sure, I do. Had you any personal dealings yourself with College Trustees ? 17 A. 18 73 Q. 19 No. I am not really interested in the details of them but if you had any contact with them? 20 A. 21 74 Q. No, none. That is okay. The next page is just the articles, 22 the Certificate of Registration of Dewdrop, which is 23 page 133 (Exhibit 15). 24 page. 25 copy of that. That is only in there for 26 completeness. I think on 23rd April, a formal offer 27 was made to Dewdrop, by Guinness Mahon and that is 28 page 135 and 136 which you have also in the 29 documents It should be the very next I think you have that there, that is just a (Exhibit 16); all right? 1 2 75 Q. Page 138 (Exhibit 17), the top of that is cut off, 3 but I think it says: 4 and it is signed by Mr. Ellis. 5 apparently an official in that company, a Director, 6 and he encloses the usual thing and says -- they are 7 obviously no longer using Montoire they are using 8 Mars Nominees, and we are familiar with them, there 9 is no difficulty. 10 Dewdrop Investments Limited Mr. Ellis was But, of course, you know nothing about that because that was not your business? 11 A. 12 76 Q. No, I don't. All right. Page 139 (Exhibit 18), which is the next 13 page in your file. 14 of a note, a certificate from the Directors of 15 Dewdrop giving certain comfort to Guinness Mahon, 16 that is all that is. 17 (Exhibit 19), it is just a note with regard to the 18 transfer from Montoire to Mars Nominees. 19 actual implementation of that. Then page 143 is copy 20 of an original allotment letter (Exhibit 20), which 21 again is of no great significance. 22 further copies 23 to John Lipscombe, do you see John Lipscombe's name 24 there 25 A. 26 77 Q. That page 139 is just some kind Page 140 is not a big deal (Exhibit 21). (Exhibit 22). That is 145 and 146 are Page 148, you will see Page 148? Yes. He is a gentleman, I think, associated with College 27 Trustees and that is just a standard letter, there 28 is nothing particularly important about it 29 there must have been some kind a rights issue I think 1 because if you look at page 149 (Exhibit 23), you 2 will see that a borrowing is requested by Dewdrop in 3 or around, in or around April of 1985, about some 4 rights that they had under some scheme of James 5 Crean. 6 time, Mr. McLoughlin, in 1985? 7 A. Was there a rights issue at around that There was a rights issue, I think, in May of 1985 8 and this would have related, I think, to taking up 9 those rights. 10 78 Q. 11 Did you negotiate this with Guinness Mahon, this additional facility? 12 A. 13 79 Q. 14 A. 15 80 Q. 16 17 Yes, they would have had. Yes, I did. Your brother did not? No. Yes. With whom would you have negotiated that do you remember? A. I was primarily negotiating with Maurice O'Kelly. 18 Pat O'Dwyer was really quite secondary initially. 19 couldn't actually say at what point he came into it 20 more. This one in 1985 we could not really say but 21 certainly I am quite sure that the earlier one had 22 dealt with Maurice O'Kelly. 23 81 Q. 24 25 I see. There was a Mr. Pender involved, did you deal with him? A. Yes. I dealt with Michael Pender. I couldn't say 26 from recollection though which of these 27 transactions. 28 29 82 Q. I I understand, yes, that is very reasonable. It is 1 2 3 83 Q. Yes, he seems to have had some input into that, at 4 that stage. Would you have discussed that on the 5 telephone with him or would you have discussed it in 6 writing. We do not seem to have anything in writing 7 which would indicate you discussed it in writing, if 8 we had we would include it? 9 A. I can't really recall that, but I would expect that 10 I would have presented information on Crean, since 11 the heart of the borrowing had to do with shares in 12 Crean. 13 later with regard...(INTERJECTION) 14 84 Q. That is a later document, yes, we will come to that later, yes? 15 16 I see on the file a document I prepared A. I would guess that I prepared something like that 17 earlier but it is not in the file and I have not 18 found anything like that in my own files. 19 85 Q. Yes, we have not either. I can only assume that it 20 might have been done on a telephone or something 21 like that? 22 A. 23 86 Q. 24 No, I would say not. You would say not. All right, well we do not have it and you do not have it either? 25 A. 26 87 Q. No. All right, fair enough. If you look at the next 27 page, page 150 (Exhibit 24), this is only a record 28 of the borrowing at a particular time. 29 May in 1985 was, I think, the appropriate date for I think 27th 1 that. 2 context, we are now a year later than when all this 3 first borrowing started. 4 finding out who owns Selima. I really have very 5 little interest beyond that. But obviously I have 6 to give considerable weight to what your brother 7 says, if I contact him I will have to give 8 considerable weight to that. 9 through and see are there hints within the file. This is, if you look at it and put it in it's Again my real interest is But I also have to go 10 This is what I am doing now. In May 1985 there 11 appears to be, at page 152 (Exhibit 25), there is an 12 offer. 13 in for a different reason, at page 154 14 because there is a note on the top: 15 There is a second copy of the same thing put "Switch from Montoire, (Exhibit 26), (Packie)sic..." 16 17 Do you see that up there on top? 18 A. 19 88 Q. Yes. That is an internal document. I would not expect 20 you to know much about it. 21 in fact, was signed by Dewdrop Investments by a 22 Mr. Scott. 23 A. 24 8 9 Q. You see that document, Did you know Mr. Scott? I never heard of him. Dewdrop Investments Limited apparently, at page 157 25 (Exhibit 27), wrote with various routine matters in 26 connection with the borrowing of the facility. 27 Nothing really arises from it. 28 (Exhibit 28), there is the formal Director's meeting 29 note of Dewdrop saying that they are taking up the At page 158 1 shares and borrowing and various other things that 2 are necessary. Do you know anything about that? 3 A. 4 5 No, I think it is fair to say that I would not have seen that until I saw it on the Guinness Mahon file. 90 Q. But could you tell me how the system worked before 6 we go any further. I understand you negotiated on 7 behalf of your brother, that I understand. But there 8 was is a mechanics necessary then, I mean it is one 9 thing to say I am negotiating on behalf of my 10 brother, but somebody had to put the mechanics in 11 place. 12 Who was actually doing that business? 13 A. 14 91 Q. Dewdrop was a company that was being used. What do you mean by the mechanics, Judge O'Leary? Well the mechanics is you, you say you pick up the 15 telephone or you go in and talk to or you supply a 16 document to Mr. O'Kelly and you agree with him: 17 Yes, I will give your brother additional money and 18 that is agreed and bankers as you say, they will 19 shake hands, and they will be very nice to you. But 20 then you come to the hard business of actually 21 saying what company's name is this going to be in. 22 Who is going to organise the resolutions. 23 going to organise the Articles of Association. 24 is going to organise all that. 25 organisation, the nuts and bolts, if you understand 26 what I mean? 27 A. Who is Who Who did all that I think that what would happen following agreement 28 on the terms of the loan, following negotiation, is 29 that I would tell Colm about that and he would tell 1 Dewdrop about that and that then Guinness & Mahon 2 would communicate with Dewdrop about the mechanics 3 of the borrowing. 4 was over that ground, at any stage and I can't 5 really give evidence on that but that is my 6 impression. 7 92 Q 8 A 9 93 Q 10 11 But did you ever make direct contact with Dewdrop? Never. Either in the setting up stage or in the other stage? A 12 13 But I actually can't say that I No, the setting up of Dewdrop was done by Guinness Mahon itself on behalf of Colm. 94 Q Well, thank you very much indeed, that is helpful. 14 Page 160 is just a note from Davy Stockbrokers about 15 the acquisition of some shares. 16 similar note. 17 look at June 1995, 12th June 1995 18 "John Lipscombe. 19 appeared to be, as you say, writing to Dewdrop, well 20 it is actually College Trustees they are writing to 21 and they think they are writing for Montoire. 22 you know any reason why they should still be writing 23 about Montoire even though I think Montoire was gone 24 from the scene, at that stage? 25 A Pages 161 is a Page 162 is a similar note. If you (Exhibit 29): Re: Montoire, Re: John." They Do I would say, I don't know, confusion? 26 Confusion is probably the best explanation of it. 27 But anyway they are communicating 28 with...(INTERJECTION) 29 1 2 3 96 Q. JUDGE O'LEARY: Yes. Then on 18th June, 4 I think: 5 "Thank you for your letter of 12th June 1985 addressed to John. The Stock Transfer Form has been executed by Montoire Limited and is returned for your further attention." 6 7 8 9 Well, in fact, the stock transfer form we have is 10 from Dewdrop but that is neither here nor there. If 11 you look at page 167 (Exhibit 31), ultimately anyway 12 all the shares were coming to the name of Mars 13 Nominees. 14 right. If you look at page 170 (Exhibit 32), there 15 is some College Trustees documentation there and as 16 trustees do, from time to time, they are looking for 17 money, at page 171 (Exhibit 33). That is ultimately what was going on. All At page 173 18 (Exhibit 34), they get the money. Page 175 19 (Exhibit 35), a new person comes into the scene 20 Paddy Meagher. 21 A. 22 Who is Paddy Meagher? Paddy Meagher is a man who worked in my office in a financial capacity. 23 97 Q. 24 A. 25 98 Q. 26 A. 27 99 Q. Or was he a Company Secretary? 28 A. He was not the accountant, no. 29 Was he an accountant? He was, yes. Was he the accountant? No. He was not the 1 2 But I mean he obviously had a function. 3 you have described his function, at that time? 4 A How would 1985, he was just part the administration team. He 5 helped me with various matters, from time to time. I 6 wouldn't say he had a very specific function. 7 was part the administration team. 8 101 Q 9 10 He Why would Guinness & Mahon be writing to Mr. Meagher about Dewdrop? A Well because if I wished to communicate with 11 Guinness Mahon on some matter relating to this loan 12 which I had been doing it would have been natural 13 that Paddy would help me on that, from time to time, 14 and that is clearly what happened here. 15 102 Q But I thought they were communicating with College 16 Trustees, Dewdrop. 17 with? 18 A They had people to communicate Sure. Nevertheless though I would have some 19 communication with Colm on these matters and that 20 led to this communication with Paddy Meagher. 21 guess the channels of communication were not 22 absolutely black and white all of the time. 23 103 Q I But I do not really think that it is a mistake, 24 because it is a very detailed letter which I do not 25 intend to go into, but it is a very detailed letter 26 and it is not the only letter. 27 there is another letter so let us make that quite 28 clear as you probably know yourself? 29 Before we finish 1 So I mean he is a man of some authority or function. 2 He is not just -- he is pulling a few strings if he 3 is getting all that information he is very near the 4 top of whatever executive structure there is? 5 A 6 105 Q 7 8 Whatever executive structure there is where? In connection with the loans, which is what I am interested in. A 9 That is all I am interested in? Well, that is not the case. He was not near any particular top but I can't recall this for starters, 10 let me put that on the record. But it would seem 11 that Colm had a view about currency. 12 what communication he would have had with Dewdrop 13 about that. Just as he discussed matters relating to 14 the loan with me, he would have discussed this. 15 Some kind of a decision in principal as to what 16 should happen with regard to the denomination of the 17 currency of the borrowing would have taken place. 18 106 Q 19 20 He had to decide was he going to stay in Deutsch Marks or was he going to go to sterling? A 21 22 I don't know But I don't recall this, I'm simply trying to interpret. 107 Q I appreciate that but what I am saying to you is, I 23 appreciate you do not recall it, but it appears to 24 mean -- you see there are three possibilities. 25 letter was meant 26 convenient way of getting it to you, 27 meant for Mr. Meagher personally, that he had some 28 personal interest in it himself, or (c) it was meant 29 for James Crean. This (a) for you and he was just a (b) it was There are three possibilities 1 2 No, there is a fourth. 3 been an agent for Colm, in respect of Colm's wishes 4 with regard to this matter. 5 108 Q He, just as I, would have But are you saying that he would have conducted some 6 of the negotiations as an agent directly from Colm, 7 not through you now or were you the agent for Colm? 8 A I would be the agent. Most probably I would have 9 communicated with Colm, I can't recall if Paddy had 10 much communication with him but I think he had some 11 and I would have told Paddy what Colm wanted and 12 asked him would he deal with that for me. 13 109 Q So in other words, am I to take it this letter was a 14 method of communicating with your brother through 15 you? 16 A 17 110 Q That is what I believe it to be. Rather than through Paddy Meagher, rather than 18 through James Crean. 19 get at? 20 A 21 111 Q That is all I want to try to Just say that again, please, Judge o'Leary. Can I take it that this letter was, on the balance 22 of probability, sent to Mr. Meagher, because you 23 were the person that needed to be informed as the 24 agent of your brother? 25 A I couldn't really say what the intention was in the 26 mind of the author of the letter, what I would say 27 was the process of communication...(INTERJECTION). 28 112 Q 29 A Right, you can tell me that, yes? Was that on an issue relating to the loan I would 33 1 have dialogued with Colm. 2 with the administration people in Guinness Mahon 3 about a thing like currency, I would have asked 4 Paddy, probably, to help me with that because I was 5 too busy. 6 again, I repeat, I actually do not recall all that. 7 113 Q 8 A 9 114 Q 10 A 11 115 Q If that involved talking That is what, I think, this means, but Had it anything to do with James Crean? Nothing whatever. So we can leave that out of the way? Absolutely. I understand that. That is out of the way. Now the 12 next thing is I just want to know should I consider 13 it a letter addressed to Paddy Meagher as an agent 14 of your brother or a letter addressed to 15 Paddy Meagher as your gofer? 16 A 17 18 I think it would be somewhere between the two, probably closer to the later. 116 Q Yes. All I want to do is put it in it's context, 19 that is all. You know, you can tell me. All right, I 20 understand. 21 this Malmasion, is that anything to do with these 22 other companies? 23 A 24 117 Q Thank you. I don't know anything about Absolutely nothing. What is it at all, is it an investment vehicle or 25 what is it? 26 Malmaison is a company which was owned by a man 27 called Fred Hilton who was the Managing Director of 28 an engineering company called Carrier Engineering. 29 1 2 118 Q. All right, so. We can leave that to one side for 3 the moment. 4 questions on it. 5 MS. MACKEY: Well, just one. JUDGE O'LEARY: You can come to it later. 6 119 Q. I don't know whether Ms. Mackey has any I have no questions on it. 7 I certainly have no 8 questions. Now if you look at the -- I do not intend 9 going into the details of that letter, if you look 10 at 180 (Exhibit 36), you will see that it is a note 11 from College Trustees to Guinness Mahon it is to do 12 with a small amount of funds that they wanted at 13 £1167.00. 14 is unnumbered, 15 (Exhibit 37), if I look very carefully at the number 16 down at the end, but it is covered. 17 you, do you see Dewdrop there, it is a lodgement by 18 Dewdrop to a Cayman Trust Company. 19 You see, in fact, I do not think really it is of 20 much relevance at all. 21 being paid and I mean it was paid to College 22 Trustees and they had Cayman accounts, I do not 23 think really it reflects anything one way or the 24 other. But it is just for the sake of completeness I 25 am not reading anything into it. But you see down at 26 the last entry there is from Dewdrop, but I think 27 all that is is Dewdrop making a lodgment to the 28 people that were providing the service. 29 College Trustees and they happened to be making it If you look at the following page, which I think it is actually 141 That really is Do you see that. I think it is only the fees That was 1 to an account which had a Cayman connection. But 2 that really is nothing to do with the person who was 3 lodging the money. It is in there only for the sake 4 of completeness. If you look at the next page 183 5 (Exhibit 38), 14th January 1986. Do you remember the 6 circumstances in 1986? 7 A. I remember something about it. There was a placing 8 to take place, in connection with the acquisition by 9 Crean, a placing of -- an issue, rather, an issue of 10 new, I think it was ordinary shares on loan stock, 11 to be carried out by Crean in connection with the 12 funding of an acquisition in the US, a company 13 called Freezer Queen Limited, which was located in 14 Buffalo. 15 funding for Colm to enable him to take up some of 16 that new issue. 17 120 Q. 18 This letter here relates to seeking Okay and the brother you are referring to there is Colm? 19 A. 20 121 Q. 21 A. 22 122 Q. 23 A. 24 123 Q. 25 Yes. Mr. McLoughlin, do you see the date on that? Yes, I d o . January 1986? Yes. If I have understood the process to date that we have gone through? 26 A. 27 124 Q. Yes. There was a borrowing by Selima, which was a Cayman 28 company and the whole purpose of my questioning is 29 to find out who owns Selima. That borrowing was 1 2 A. 3 125 Q. Yes, right. It might not have been the intention but it seems to 4 have been that. 5 is really not significant to the point. It was then 6 taken up by Dewdrop, all right? 7 also acquired additional shares, in Creans? 8 A. 9 126 Q. Even if you left out that stage it In between, Dewdrop Yes. Which I think were a rights issue or something like 10 that. 11 This is January 1986. 12 any document, anywhere throughout that year and a 13 half that your brother is mentioned? 14 A. 15 127 Q. 16 A. 17 128 Q. 18 All this process commenced in 1984, May 1984. This is the first time, in Yes. Now have you any comment to make on that? No. Did Guinness Mahon know that the borrowing was for your brother? 19 A. 20 129 Q. Yes, they did. How is it that in any of the files, there is no 21 reference of any kind to your brother for a year and 22 a half? 23 A. 24 130 Q. 25 A. 26 131 Q. Then there is lots of references to your brother? 27 A. Most of the material that we see here is Guinness Most of the. Then there is lots of references to your brother? Most of the material...(INTERJECTION) 28 Mahon material and it would appear from that that 29 they are dealing with Dewdrop or Montoire or Selima 1 or whoever it is, as a borrower and all the 2 documentation relates to that and does not involve 3 the shareholder. 4 looking at this file. This is a document from me and 5 I am coming up and making a presentation to G&M and 6 seeking additional borrowings and it was natural 7 that I would say what the position was, as I did all 8 along accept that there is no...(INTERJECTION) 9 132 Q. 10 Mr. McLoughlin, It would appear like that from I am not criticising the fact that you said it? 11 A. 12 133 Q. 13 A. 14 134 Q. Sure. I think it is to your credit that you said it? Yes. Forget that. That is to your credit. What I am 15 saying is that for the previous year and a half, 16 when there are a number of references even to 17 guarantees by you and to repayments by you, there is 18 no one individual note that this business was being 19 carried out for and on behalf of your brother. 20 is extraordinary? 21 A. That Well I would make two comments about that. The first 22 is that all of the material is Guinness Mahon 23 material. It would appear that their practice in 24 relation to a facility to a company like Selima, 25 Dewdrop or Montoire is to deal with Selima, Dewdrop 26 or Montoire without referring to the shareholder. In 27 relation to the issue of communication on the loan, 28 in relation to the issue of a guarantee, for 29 example, make no mistake about it, Guinness Mahon 1 would not have lent to my brother if I had not 2 introduced him and asked them to do so. I was the 3 person that had a relationship with them for ten 4 years. 5 looking at the credit, from a risk point of view, 6 they would have been looking to me as the party to 7 talk to. Therefore, if they were looking for a 8 guarantee, 9 would be the person that they would talk to. The They didn't know him. So in terms of for example, it is not surprising that I 10 only references here to the shareholder at all are 11 here by myself, there is no reference the 12 shareholder whomsoever he might be, on the part of 13 Guinness Mahon. 14 about that. 15 135 Q. I see. So I don't see anything strange I have heard what you said. Now we are 16 going to take a break, if you do not mind for about 17 five or ten minutes and I think there is tea or 18 coffee there if you would like to have it. 19 A. 20 136 Q. Thank you. Thank you very much. You can keep the file. You 21 can look at the rest of the file. 22 in it that is anything magical. 23 magical in the file. They are all routine documents. 24 We will go out. 25 26 27 28 29 A SHORT ADJOURNMENT There is nothing There is nothing 1 2 AS FOLLOWS 3 4 137 Q. JUDGE O'LEARY: We were at the document of 5 24th January 1986. Are 6 you sure, Mr. McLoughlin, that the brother to whom 7 you refer there was Colm and not Phelim? 8 A. 9 138 Q. One hundred percent. One hundred percent. Who am I to tell you about your 10 brothers. There is a document then which follows 11 from that which I think, it would be fair to say, 12 has a certain passing similarity to the way in which 13 a note to John Furze was set out. It is on page 184 14 (Exhibit 39). 15 Mr. McLoughlin, 16 governance of James Crean, it is a matter of no 17 concern to me, but I am only interested in these 18 things insofar as and to the extent that they 19 impinge on the on the quest, today's quest and 20 today's quest relates to who owns the actual shares 21 or who was the beneficial owner of the shares which 22 commenced at Selima. So I am looking at this 23 document only in that context and it appears to me 24 to be a very strange document for a person in a 25 company to write about a proposed borrowing of a 26 person external to the company, in advance of the 27 information becoming public. 28 the events of the information becoming public, part 29 of it, that is not the purpose of my question. I want to make it clear, I am not concerned with the I am not interested in 1 Accept that it is, if it is genuinely for your 2 brother are you not giving the bankers information, 3 as your brother's agent, which is very strange 4 information to give about what the company is going 5 to do, for example? 6 I cannot see that, Judge O'Leary. 7 139 Q 8 9 You might not agree with it? A 10 I know what you are saying but I can't find any agreement with it. 11 140 Q 12 A 13 141 Q 14 Can you see the thrust of what I am saying. You cannot find anything to do with that? No. Well if you look at the first page of it: "In the next few days Crean will be announcing an agreement." 15 16 Now I know they either had announced the agreement 17 or they had not. 18 external to the company getting that information, it 19 is not the kind of information that you, as an 20 honest and honourable and careful Managing Director, 21 of a public owned company would give to me as a 22 third party. 23 announcement. The company will be making an 24 announcement. Again I am only interested in the 25 context of who owns the shares. 26 interest? 27 Unless that, I was confident, that you would not run 28 and around disclosing it to every Tom, Dick and 29 Harry. If they had not a person who was In a few days I will be making an That is my only 1 But the disclosure to me might cause me to go away 2 and do things buy or sell shares, as the case may 3 be, and you would be conscious that you would not do 4 that, particularly if I was an investor in your 5 company already? 6 A 7 Are you talking about my communication here now, to Guinness Mahon? 8 143 Q 9 A Yes, I am precisely, I am talking about page 185? Well, I cannot say what my thinking or mind set on 10 that issue was at the time. 11 addressed it. But looking back at it in retrospect, 12 I think it is reasonable to assume that I would 13 regard, if I did think about this, communication 14 with a reputable bank like Guinness Mahon to be a 15 confidential communication. Every time you talk to 16 your bank with regard to a matter in Crean, we talk 17 to our bank, we don't every time we talk to them 18 say: Now remember this is confidential. 19 is par for the course, it is the basis upon which 20 communication with your bank is undertaken. 21 144 Q I can't even say that I It actually I understand, yes, of course, but I am not talking 22 about that. 23 your brother, because you were acting -- this 24 information was not information being conveyed to 25 the bank, it was information being conveyed to the 26 bank as agent for your brother? 27 A I am talking about a communication to You are talking about the fact that I would have 28 told my brother about this matter. 29 Yes, effectively by saying: 42 I am telling your bank? 1 A. Well, again I can't see what the problem is there, 2 unless I thought that my brother would run around 3 telling somebody. There was not any question of him 4 dealing prior to an announcement. 5 insider legislation, at that time, anyway. 6 146 Q. There was no I am not interested in the legislation, as such. I 7 am really only interested in whether it is a kind of 8 thing you would do for your brother or you would do 9 for yourself is really what I am interested in? 10 A. I think that in relation, in my experience, in 11 relation to a matter like this matter, a large body 12 of people, a very large body of people, 13 this project, 14 was no way that we got everybody to sign a 15 confidentiality agreement, it was just business 16 practice in those days that if you communicated on a 17 matter like that that it was regarded as 18 confidential. 19 147 Q. knew about knew that it was on the way and there If you look at page 187 (Exhibit 39), there is 20 paragraphs. 21 It sets out, for your brother's benefit. 22 mean just for your bank's benefit, but for the 23 brother's benefit what the company policy towards 24 loan stock is? 25 A. There is a subparagraph 7 of that memo. What is wrong with that? I don't The very document which 26 would be released a few days later would spell out 27 that the redemption date was 1995. 28 about telling him about this a few days before hand 29 unless he is going to misuse it in some way. You can So what is wrong 1 take it, although I don't recall having any 2 discussion about this or even reflecting on it. 3 can take it that if I did address it, at the time, I 4 would have been very, very confident that my brother 5 would not, in any way, abuse the information to the 6 detriment of the company. 7 148 Q. 8 I understand that. You Thank you very much. You might looks at page 193 (Exhibit 40). 9 A. 10 149 Q. Yes? Now that puts the position quite clearly. This is a 11 file note which is to do with the proposal which 12 they have got, dated 4th January. 13 in Guinness Mahon says it is MCK, that is 14 Maurice O'Kelly, somebody says well, we will do a 15 file note on the position. 16 done, Ray McLoughlin, RMC, James Crean PLC, present 17 position. 18 has three borrowings: 19 am not interested in at all, at the moment anyway, I 20 am just not interested in it, but Dewdrop 21 Investments, under your name, under your borrowing? 22 A. Somebody inside You see what they have Under Ray McLoughlin/James Crean PLC, he Connolly, Malmaison, which I Well, I can say something about that. It is a 23 standard part of the credit due diligence with any 24 credit committee, that in relation to any facility, 25 in a bank, that they look at the connection, every 26 facility that there is any connection with, in 27 relation to whatever one they might be reviewing, in 28 order to determine as part of the risk assessment 29 process, if there is anything about these linkages, 1 which cause them to be concerned about the risk. The 2 connections necessary for this to happen are very, 3 very oblique and I can say this with some authority 4 because for many years I have received presentations 5 with regard to this very issue whilst on the Board 6 of Allied Irish Banks. In this case here, these were 7 all things with had some connection with me of some 8 kind. 9 example, that was an actual loan to him from If you take the Gerry Connolly one, for 10 Guinness Mahon, guaranteed by Crean, in connection 11 with our involvement called IIS. 12 do with me accept insofar as...(INTERJECTION) 13 150 Q. 14 A. 15 151 Q. 16 17 It had nothing to It had to do with Creans? Sure. It was guaranteed by Creans, because the heading is Ray McLoughlin/James Crean? A. Okay, but insofar as we are talking about the first 18 part of that heading myself and saying that the 19 Gerry Connolly had nothing to do with me other than 20 to the extent that I was Managing Director of Crean. 21 The Malmaison company was a company that I had no 22 shareholding in, wasn't a Director of, wasn't 23 standing over the borrowings. 24 do with me in financial terms either. Dewdrop, 25 have already told you. So there is nothing 26 extraordinary about this kind of note appearing in a 27 bank file. 28 connected facilities of any kind are reviewed as 29 part of a credit risk. So I wasn't surprised to see That had nothing to It is standard procedure. I They are all 1 that really. 2 places. 3 152 Q. 4 5 I have seen it in lots of other Dewdrop was the company that you refused to give a guarantee for? A. Well, Dewdrop is a company that I didn't give a 6 guarantee for. 7 recall there ever having been discussion with me 8 about it. 9 153 Q. All right. I did say earlier that I don't You did not give a guarantee. So 10 specifically they were looking for a guarantee, if 11 only by internal memo, you did not give it and they 12 are still saying it is something to do with you? 13 A. Hang on a tick now. First of all, the only point 14 where asking me for a guarantee with regard to 15 Dewdrop arose is back at those two letters to 16 Pat O'Dwyer. 17 seen in this document since then and indeed on my 18 review of the file earlier, show no reference 19 whatever to the question of a guarantee. 20 you can take it that the guarantee was something 21 that Pat O'Dwyer came up with and was outside the 22 box of any discussions I had had with 23 Maurice O'Kelly and my guess is, but I don't recall 24 it, that it was killed off when I spoke with 25 Maurice O'Kelly about it, back in 1984. 26 of the guarantee, 27 relevant, in relation to this. 28 gone, at this stage. Now there is no doubt about it, 29 Dewdrop is something they would have seen me as All the facility letters that I have I think So the fact I can't see is particularly It long since is 1 connected with. Not only that, the philosophy at 2 Guinness Mahon was such, at the time, that I'm the 3 person they would be looking to, to see them through 4 this if any problem arose either by delivering on 5 the Crean side or otherwise. 6 mystery about this file note. 7 154 Q. So to me there is no I see. The next is an internal document, page 195, 8 to deal with Malmaison, really, it is matter I have 9 no particular question to ask you on. Similarly 10 196, I have no particular question to ask you on. 11 197 is a note of the Dewdrop Investments new 12 facility. 13 loan facilities for Dewdrop. I wonder would you turn 14 to pages 224 15 224. 16 order. 17 A. 18 155 Q. 19 A. 27th February 1986, page 200, is more (Exhibit 41). Do you remember that, They should be in more or less the right It is a note to Martin Keane. Yes. Could you explain the circumstances of that? First of all, it is nothing whatever to do with 20 Dewdrop or Selima or Montoire. 21 sale of shares by myself and the intention, at a 22 point in time, that the sale would be to my brother, 23 Colm, which intention was cancelled, just before the 24 transaction was completed and that led to a 25 complicated mess in Guinness Mahon because it got a 26 whole lot of things wrong which they subsequently 27 corrected but obviously I will talk about it, if you 28 want me to. 29 Dewdrop, Selima and Montoire, and completely That relates to a But it is completely unconnected with 1 unconnected also with the purchasers of Crean shares 2 and the funding for them that we have been talking 3 about here. 4 I should have asked you earlier on, your brother 5 Phelim, what does he do for a living? 6 A He is President of the Irish Rugby Union Exiles and 7 he spends about 80 percent of his time at that. 8 About 20 percent of his time he sows and sells 9 Christmas trees. He operates gaming machines. He 10 was, at one stage, primarily involved in cigarette 11 vending machines. 12 157 Q 13 A 14 158 Q 15 A 16 159 Q 17 A He is involved in general buying and selling? He has sort of semi-retired. Is he older or younger than you? He is two years younger than I am. And Colm, what does Colm do? Colm's primary job is as head of the Dubai duty free 18 operation, which has been an outstanding success 19 having achieved accolades wide and far, over the 20 past twenty years. 21 responsibilities as well. He is used by the Dubai 22 Government, to spear head the promotion of Dubai 23 through various sponsorship which are carried out by 24 Dubai Duty Free, he sponsors races on behalf of 25 Sheik Mohammed. He brought an ATP tennis event to 26 Dubai and manages and controls it. 27 voted as the best on the ATP Tour apart from the 28 Majors. He runs a club in Dubai which is owned by 29 the Government in the city of Dubai, called the He has several other It has been 1 Aviation Club, which is a one million square foot 2 club with multi facilities in it. He is known for 3 having implanted in the middle of that what is 4 called an Irish village, which is a replica of an 5 Irish pub and village, which has been hugely 6 successful and is the basis for this particular club 7 washing it's face. He is involved in the promoting 8 of some marketing, a certain degree of horse racing 9 there. He has been involved also in the snooker 10 classic in Dubai. 11 have to do with promotion of Dubai as a separate 12 activity from really the Dubai Duty Free. 13 160 Q. Generally a range of things which Yes, I understand. Grand, thank you. Well if you 14 tell me that Phelim's involvement is to do with 15 buying and selling shares of your own which are 16 nothing to do with Montoire or any of the associate 17 companies, I have no interest in him? 18 A. 19 161 Q. Absolutely nothing. It is not a matter which concerns me. You might go 20 to page 244 21 Mr. Meagher and is about Montoire. 22 still working for James Crean? 23 A. 24 162 Q. 25 A. 26 163 Q. 27 A. 28 164 Q. 29 (Exhibit 42). This is another letter to Is Mr. Meagher He is retired. Where does he live? He lives in Dublin here in Cross Avenue. Do you know his address, do you? I do, indeed. You might give that to your solicitor in due course. 1 2 165 Q 3 A No. A lot of the -- most of the material on this 4 file I would not actually remember but I could put 5 them in context, some of them I could. 6 166 Q During the course of this investigation we have got 7 from the Irish Permanent, who are now the owners of 8 Guinness Mahon Ireland, on page 328 9 only page 328 (Exhibit 43) and (Exhibit 43) for the moment. You do 10 not have it there, I will have to give you this 11 separately. 12 magical about the document. 13 document. 14 a number of pages but really one page is relevant to 15 you. If you read the front of the -- have you given 16 Mr. McLoughlin that? 17 MR. SLEVIN: No. JUDGE O'LEARY: Give him page 328. 18 167 Q It is not really -- there is nothing It is a three page It is in fact it is more, there are quite 19 that document. Just The reason 20 I cannot give you the other ones is that there is a 21 whole list of names that have nothing at all to do 22 with you; do you understand? 23 A 24 168 Q Yes . You can keep that document. You can take it, we 25 have received evidence from Guinness Mahon that the 26 word's "suitably secured" or "adequately secured" 27 had a particular meaning, at that time. At the time 28 that we are investigating. 29 granted to an individual or a company and that that It meant that a loan was 1 loan was backed by money outside the jurisdiction. 2 Sometimes quite infrequently, in fact, it was the 3 north of Ireland. 4 was much more frequently one of the Channel Islands 5 or Cayman. 6 Mr. McLoughlin, as having a borrowing in 1987 of 7 £77,600 from Guinness Mahon? 8 A. 9 169 Q. That was quite infrequent. It Your name appears on that list, Yes. First of all, I can show your lawyers the list, 10 there is no difficulty. 11 physically show you the list because there are 12 dozens upon dozens of names on it which are of no 13 relevance to you which your lawyers are perfectly 14 entitled to see. Do you remember having a borrowing 15 from Guinness Mahon, at that time? 16 A. 17 170 Q. 18 A. 19 171 Q. 20 A. 22 172 Q. 23 £77,600? Yes, I d o . You do. The fact that there was a borrowing is Was it backed by money elsewhere? No, it was not. It was not, okay. Was it backed by any security outside the state? 24 A. 25 173 Q. 26 No. Have you any reason, can you give me any reason why it should be noted by them to be "suitably secured"? 27 A. 28 17 4 Q. 29 Of £77,600? established. 21 I do not want to actually No. Did you have money backing that borrowing in the Cayman Islands? 1 2 175 Q 3 A 4 176 Q No. Could I explain to you why I am asking you about the 5 Channel Islands because on one reading it might not 6 have anything to do with us but I think it is only 7 fair to say it to you that the system operating by 8 the Channel Island company, College Trustees, was 9 that where they had got money from an Irish 10 resident, in the 1980's, they channelled that money 11 through the Cayman Islands back to Dublin. 12 those people even though they might not have 13 realised it, were dealing with the company we are 14 investigating. 15 asking you that? 16 A 17 177 Q So all Do you understand the reason I am Yes . If it was the North of Ireland back to back it has 18 nothing to do with me, I am not concerned with it at 19 all. 20 A Can I ask you Judge O'Leary, if you have available 21 to you correspondence that took place between Irish 22 Permanent Building Society and ourselves in relation 23 to that matter? 24 178 Q 25 A 26 179 Q 27 A 28 180 Q 29 No? You do not have it. We addressed this issue. But it is my intention to get that correspondence? Yes . Mr. McLoughlin, since we are on that, why did you not give us the documents that we asked you for? 1 2 The documents we asked you for in a letter. You know 3 the documents we are talking about. 4 documents that you had got from Irish Permanent 5 yourself. 6 documents ? 7 A 8 182 Q 9 A Most of the Why did you not give them to us, Selima Is this back in February? Yes? I think the answer to that, Judge O'Leary, is that 10 it did not occur to me that you were talking about 11 what I would have received from Guinness Mahon. 12 made the assumption, clearly a loose assumption that 13 you were asking me for any separate documents I 14 would have in my own files. I would mention to you 15 that I was about to go into hospital then for a hip 16 operation, having been for nine months on two 17 crutches without sleep. 18 focused on this issue as I usually would be. 19 that is the assumption that I made for better or 20 worse and it didn't occur to me that you would have 21 been talking about the Guinness Mahon material. 22 assumed that is Guinness Mahon material. 23 183 Q I So I might not have been as But I But I do not necessarily -- I mean I hope I have all 24 the stuff from Guinness Mahon, but I cannot 25 guarantee that I have all the stuff from Guinness 26 mahon and I specifically asked you for any 27 documents ? 28 Well, we can give you everything we have and I 29 regret that that happened but it did happen in that 1 2 If you let us have the copies of the correspondence 3 which you had with Irish Permanent on this fact, it 4 will not be necessary for me to go to the Irish 5 Permanent then. 6 MR. SHIPSEY: 7 Just to be clear the correspondence that we had 8 was not in connection with Selima, it is connection 9 with what you are talking about now, namely whether 10 there was back to back deposits. 11 JUDGE O'LEARY: 12 I understand. But it is one of the issues which we 13 are interested in. 14 MR. SHIPSEY: 15 Yes. Just in relation to Selima, all we have in 16 relation to Selima, on my instructions, are what we 17 got from Guinness Mahon. 18 we got from them. 19 JUDGE O'LEARY: 20 We will show you the file Is it the same as what I have shown you 21 MR. SHIPSEY: 22 It is exactly the same as what you have shown us 23 JUDGE O'LEARY: 24 Is there anything different? 25 A 26 185 Q 27 No, it seems to be exactly the same. Would you check it and if there is anything different would you sent it to us? 28 A 29 186 Q I will, Judge. 1 2 MR. SHIPSEY: Sure. 3 JUDGE O'LEARY: Ms. Mackey reminds me of a 4 problem that we have come 5 across sometimes, and I am not saying it refers to 6 you because I don't know, that when people had 7 deposits outside the jurisdiction, they were 8 sometimes used as backing facilities by Guinness 9 Mahon without apparent authority because we have 10 honourable people coming in and swearing to us and 11 we accept that. Would it be possible that there were 12 other deposits that they used without your authority 13 outside the jurisdiction? 14 A I think it is impossible. I don't know how that 15 situation arose but I'm very clear that there was no 16 question of any other security. 17 actually made that loan is Martin Keane and I 18 discussed it with him when Irish Permanent raised 19 this matter two years ago and he confirmed his 20 recollection that no additional security was given. 21 188 Q 22 A 23 189 Q 24 The man who But did you have deposits outside the jurisdiction? No, I did not. You did not. You know now when I say you I mean you or, you know? 25 A 26 190 Q 27 Any parties connected with me? Parties connected with you. mean you. 28 A 29 191 Q I do not necessarily You are confirming that you do not? I am. Is Colm's wife's name Breda? 1 2 Do you know anything about a payment made to them 3 from an Ansbacher company, I am using that now in a 4 slightly, it is actually Hamilton Ross that is the 5 name of the company. 6 1993? A payment made to them in 7 A 8 193 Q 9 A 10 194 Q 11 A 12 195 Q 13 A I don't know anything about that. 14 196 Q You do not know nothing about it? 15 A 16 197 Q No. Of ST£135,000? To Breda. To Colm and Breda McLoughlin? No. Did it come from funds at your disposal? No. No, I do not intend to show the document to 17 Mr. McLoughlin. 18 should properly ask his brother about it. 19 have to first of all find out is it anything to do 20 with him? 21 A 22 198 Q If it is nothing to do with him, I I just No. It is page 272, in fact, but I am not going to -- if 23 Mr. McLoughlin says it is nothing to do with him 24 then I will not show him the document. Did you 25 discuss this matter with your brother, obviously you 26 had certain discussions with him? 27 A Yes, would you ask me that question again. 28 Did you discuss these chain of events with your 29 brother, giving rise to this correspondence from 1 2 Briefly, he is in Brazil at the moment and I had a 3 belief discussion with him. 4 discussion with him about this about two years ago. 5 200 Q But I did have a You see it is just that you have given us a 6 document. 7 that you have given me a document, presumably with 8 the authority of your brother because otherwise you 9 would not have given to me. This puts me a slightly awkward position It was obviously given 10 for that purpose. 11 I would have to find that he is a client of 12 Ansbacher and name him in the report accordingly. Of 13 course, I will give him an opportunity of coming 14 talking to us. 15 opportunity. 16 don't know, but I just want to make it clear that I 17 want to get it straight from you. 18 brother's authority to give us this document? 19 A 20 201 Q 21 A 22 202 Q The nett effect of which is that Of course, I will give him that Whether that is possible or not, I Have you your You mean that letter (Exhibit 44)? Yes? Yes, I have. Poinciana Fund, do you know anything about Poinciana 23 Fund, I do not mean about your business with them, 24 forget that for the moment. Do you know anything 25 about Poinciana Fund as such? 26 Absolutely not. 27 a few times, but I wouldn't say that I have taken 28 anything away from that reading, any detailed 29 knowledge of it. I have read about it in the papers I just know it is a Des Traynor 1 2 203 Q. 3 It is a Trust really. It is a Trust with certain companies ? 4 A. 5 204 Q. Yes? It is a trust with strong Ansbacher connections. 6 You can take it that it was established with strong 7 Ansbacher connections. 8 record I know you have put it on paper and that is 9 very helpful indeed and we appreciate that, Could you just for the 10 Mr. McLoughlin. 11 involved with that aspect of the matter? 12 A. Yes. Could you explain to me how you got We launched a rights issue in April of 1994. 13 It was a very big rights issue by our standards 62.8 14 million. 15 possible at the time. 16 various reasons in the proceeding years, so we had a 17 shot at going full whack. 18 marketing effort, we found that not all of the 19 rights were either taken up or sold at the end of 20 the 21 day period. 21 unsold rights fall back to the underwriters unless 22 the brokers can manage to place it at the end. 23 is normal if that happens is that the brokers have a 24 day and a half or two to place the rump. In this 25 situation there was £21 million unplaced, at the end 26 of the 21 minute period and comprising approximately 27 £5 million ordinary shares and £16 million of loan 28 stock. We anticipated in the last few days that this 29 was going to happen because the efforts to get it Beyond the limit of what was thought Our borrowings built up for Despite a lot of Normally when that happens the It 1 all away, during the rights issue period, were 2 clearly not going to be sufficient and Davy's, as 3 brokers to the company, together with myself as the 4 company attempted to place that rump in the final 5 days of the right's issue and in the day or day and 6 a half afterwards. 7 end of a right's issue, is something that must be 8 done in total, when you place a bit of it with an 9 Investor, it has to be conditional on it all being 10 The placing of a rump, at the placed. 11 205 Q 12 A Yes, I understand? Davy's were failing to get it away and I was brought 13 into the frame to see if I could go to the 14 Tony O'Reillys and so forth, of this world, to see 15 if some of that stock could be placed with private 16 investors and I did make a few attempts. I spoke 17 with Des Traynor about it. 18 that he had discretionary funds under his control, 19 which I had not known and I spoke with 20 him...(INTERJECTION). 21 206 Q 22 A Somebody suggested to me Which you had not known, is it? I had not ever heard that he had had, that he was a 23 manager of discretionary funds but he was in that 24 business. He made very positive noises about being 25 able to place, there was a residual £5 million of 26 loan stock we couldn't get away, about being able to 27 place that with clients of his. 28 Was the remaining £16 million having conditionally 29 been placed? 1 2 208 Q 3 A I understand, yes? Without going into the minute by minute detail, a 4 point was reached, close to the end, where he said 5 he couldn't get it done before the target time, 6 which was end of 14th April, which was two days 7 after the end of the right's issue. 8 brother Colm if he would make a short-term loan 9 available so that Des Traynor could take up the 10 stock and then place it on or sell it on to his 11 clients shortly afterwards. 12 high confidence that he would get it done within a 13 few weeks. 14 brother to the Poinciana Fund. Unfortunately 15 Des Traynor died shortly afterwards before he had 16 placed the stock with clients and as a result the 17 needle became stuck in terms of placing the stock 18 with clients of his. So that is the heart of the 19 matter. 20 209 Q 21 22 He had expressed very That is what led to the loan from my Ultimately then, was the £5 million concluded in terms of -- I mean Did Creans get their £5 million? A 23 24 I asked my They did. I can give you a letter from Davy's to Allied Irish who were seller...(INTERJECTION). 210 Q 25 I am not conce4rned with that, if you tell me they did? 26 A 27 211 Q Confirming, yes, on the 14th. If you tell me that they did, I will accept that. So 28 then we had a situation where who was the owner of 29 the £5 loan stock the day after that? 1 2 the end which is that at the very last minute, when 3 all seemed lost IVI took up £3 million of loan stock 4 which up to then they had not been persuaded to do. 5 So that, in fact, there was only a £2 million 6 residual and Poinciana took up the £2 million 7 residual. The intention was that Des Traynor would 8 place it on with some clients. 9 212 Q. 10 A. 11 12 I understand? So your question was what happened to the...(INTERJECTION) 213 Q. So the day after this happened the 15th of whatever 13 the month was, you say that you had to do it by the 14 14th of whatever month? 15 A. 16 214 Q. 17 So by the 15th of April who owned the residual £2 million loan stock? 18 A. 19 215 Q. 20 21 April. All right, Poinciana Fund. Poinciana Fund. that. A. How did your brother impact with Had he guaranteed the fund or something? He had lent the money to Poinciana Fund on a short 22 term basis to enable it to buy the loan stock 23 pending of the replacement of it by Poinciana with 24 clients. 25 216 Q. 26 A. 27 217 Q. 28 A. 29 218 Q. So he did not however own the loan stock himself? No. He did not own it? No. All right. He did not own it. So Poinciana owned 1 2 3 4 company was Knighton, I 5 think. Colm mentions it in Point 5 of his letter, 6 that that loan was provided by Knighton, a company 7 owned by me. 8 219 Q. JUDGE O'LEARY: 9 That is grand. I am not really concerned about 10 that but that is grand. So Knighton loaned £2 11 million and Poinciana used that. 12 risk then on 16th. You see I might have an interest 13 in Poinciana, that is my interest really. I have an 14 interest in Poinciana, that is the reality of the 15 situation. 16 and we have this situation where who had the risk 17 now on the loan stock? 18 A. 19 220 Q. 20 A. 21 221 Q. 22 23 But whose was the So again we will move on by a day or two Poinciana. Poinciana had the risk? Yes. They had. What ultimately happened to that loan stock? A. Crean made an offer to all loan stock holders to 24 redeem the loan stock sometime in 1997. 25 was about mid 1997 as part of tidying up it's 26 balance sheet and keeping it's bankers happy. At 27 that stage, the share price had dropped 28 substantially so there was no conversion premium 29 available. I think it Every share holder, every loan stock 1 holder took up that redemption offer. So, in effect, 2 it was liquidated. 3 222 Q 4 A 5 223 Q 6 A 7 8 They got their money back? They got their money back, yes. They had got interest in the meantime? Yes, it was seven percent or seven and a quarter, or something, percent. 224 Q 9 This is where I am interested in it really. That is all very interesting but really it is of limited 10 interest to me. What is of interest to me is that in 11 1997, who were you dealing with. 12 James Crean, of course, who were you dealing with in 13 Poinciana? 14 A 15 225 Q 16 A You know I mean You mean as Crean? Yes? We did not deal with anybody. I happened to know 17 that that stock was held at that time through Payne 18 Weber 19 for it. 20 didn't have any dealing with Poinciana at all, they 21 were just a loan stockholder. 22 have any individual dealing with any loan stock 23 holder. 24 226 Q 25 26 (sic), a bank in New York, they were nominees I believe I learned that from Davy's. So we You know, we wouldn't Did you write to them, at some stage, did you have an address for them? A 27 I would say that there was interest paid every year and then...(INTERJECTION) 28 227 Q 29 A It must have been sent somewhere? Yes and there was the offer, and I actually can't 63 1 say that but it was to whoever the registered share 2 loan stock holder on the Register was. 3 know that was Payne Weber (sic) at some point in the 4 process. 5 Yes. 6 interest with regard to that is. 7 dealing with somebody in Poinciana Fund, at that 8 stage, a name, I would like to know who the name 9 was ? 10 A 11 229 Q 12 A 13 230 Q What I am interested in, I will tell what my None? None. There was no reason why we would. So you were dealing with Des Traynor and Des Traynor died. 15 Des Traynor died? A 17 18 If you were We had no dealings with Poinciana Fund. 14 16 I happen to That must have been a shock to everybody when It throw the spanner in the works of what was happening here. 231 Q So the morning after Des traynor died, i do not mean 19 that literally now, but immediately after he died, 20 who in Poinciana Fund would you have contacted? 21 A I would have had no contact with anyone. My 22 involvement in this stopped once that rights issue 23 finished and the loan arrangement between Poinciana 24 and Colm's company was complete, well, I wasn't 25 involved in that. 26 connection with all of this stopped. 27 JUDGE O'LEARY: 28 29 By sometime in mid April my That is fine. Thank you very much, Mr. McLoughlin. Have you questions to ask Mr. McLoughlin? 1 2 JUDGE O'LEARY: 3 Have you any questions, Mr. Cush? 4 MR. CUSH: 5 Yes. (TO WITNESS) 6 Mr. McLoughlin, just in relation to placing the rump 7 and you coming into that activity and bringing the 8 Tony O'Reilly's of this world, that was presumably a 9 fraught enough time for you personally; was it? 10 A It was a pretty difficult because there was a high 11 prospect that the £21 million would revert to the 12 underwriters and at that time that is regarded as a 13 disaster, as you probably know and we looked upon it 14 as that at that time. 15 234 Q So someone then told you that Mr. Traynor might have 16 discretionary funds under his control, he might have 17 been managing them, I think, you said? 18 A Somebody suggested that he was worth approaching on 19 the basis that he may have had or may have 20 discretionary powers with regard to funds under his 21 control. 22 235 Q You did approach him and it turned out that he 23 expressed confidence about being able to help you 24 out of your difficulty? 25 Yes, what he said he would do is he was confident 26 that he had clients who would take this up. 27 guaranteed by the redemption back stop and the seven 28 percent interest and he expressed a high level of 29 interest in it on behalf of some clients. It was 1 236 Q Did it come as a surprise to you to learn that 2 Mr. Traynor managed these funds and had these 3 clients ? 4 A I think, the first thing I would say is that when I 5 got talking to him I found that he didn't have 6 discretionary powers because he had to persuade the 7 clients to do that this, to believe that he could. 8 So once I learned that I'm not sure if I was 9 surprised or not surprised but I wouldn't have been 10 at the forefront of my agenda at the time. 11 forefront of my agenda was getting this done by hook 12 or by crook. 13 237 Q 14 A 15 238 Q 16 A The Of course, but he spoke to you of having clients? Yes . Clients with significant amounts of money? Well, I couldn't really say that but it is implicit 17 in the discussions I had with him that he was 18 talking about clients who were sufficient to take up 19 £5 million pounds of loan stock. 20 239 Q 21 that Mr. Traynor might have that function? 22 A 23 240 Q 24 25 Yes and who was it then that was able to tell you Who was it that what? Who told you that Mr. Traynor might be worth approaching? A I can't recall that. You know there were a number 26 of people scratching around trying to find names we 27 might approach. It could have been somebody in 28 Davy's. I can't be sure about that. If I had thought 29 myself that he was a possibility or it occurred to 1 me I would have approached him anyway. 2 belief is that somebody mentioned it to me and I 3 followed it up. 4 Well can we take it that you did not know prior to 5 being told by somebody that Mr. Traynor had clients? 6 A But my What would I have known about Des Traynor in 1994. 7 I really would have had a most amorphous and vague 8 notion that he was Chairman of the bank in the 9 Cayman Islands and I really wouldn't have known 10 anything about the detail of that. 11 242 Q 12 A You cannot remember who might have told you? No, I can't. But the impression that is in my 13 memory is not that somebody said with specific clear 14 knowledge that he was a man that could do this, but 15 that it was a suggestion amoungst dozens of 16 suggestions. 17 suggested, 18 Larry Goodman at all. 19 there is any great significance in the suggestion 20 that was made to me. 21 thinking of guys who might just help out in the 22 crisis that existed at the time. 23 243 Q 24 A 25 244 Q 26 A I remember Larry Goodman being for example, at the time and I don't know JUDGE O'LEARY: So I really do not think It was just, you know, people Where did you meet him? Des Traynor. Yes ? I first met him, Judge O'Leary in 1973. In 1973 I 27 carried out a reverse take over of Creans through a 28 private company of mine called Shelbourne. Guinness 29 Mahon were financial, corporate finance advisors to 1 the Board of Crean at the time and it was in that 2 regard that I know...(INTERJECTION). 3 245 Q No, I think you misinterpreted what I say. Where 4 did you meet him for the purpose of discussing this 5 with him, physically did you meet him? 6 A 7 246 Q 8 A 9 I think I met him in his office in Fitzwilliam. 42 Fitzwilliam Square? I wouldn't remember the address but you know the cement road stone offices. I think I might have met 10 him also in Berkley Court or Shelbourne. 11 maybe the Berkley Court. 12 him twice, at that time. I am nearly sure on one 13 occasion was in CRH. 14 247 Q 15 A 16 248 Q I think I think I might have met Yes I see. Once in the CRH office? I'm nearly sure of that, yes. MR. CUSH: Just a different matter, 17 Mr. McLoughlin, you 18 mentioned that you spoke to your brother, Colm, 19 about, broadly speaking, these matters approximately 20 two years ago. 21 occur? 22 A In what circumstances did that It was when I first received the file for G&M. It 23 may not have been two years ago, it feels like that. 24 I reviewed them and naturally discussed it with him 25 as his companies would figure very prominently in 26 that file. 27 249 Q 28 A 29 250 Q Has he seen the file? No. You have not sent it to him? 1 2 251 Q 3 A 4 252 Q No. JUDGE O'LEARY: 5 6 himself; would you say? A 7 8 I am 95 percent sure he did not. 99 percent sure he did not. 253 Q MR. CUSH: To your knowledge, does he 9 have any records of his 10 11 Did he get it from GMI own in relation to any of this? A 12 I don't know what his position would be with regards to records. 13 254 Q MR. CUSH: Thank you very much. 14 255 Q JUDGE O'LEARY: What would you say to the following statement: 15 GMI 16 who circulated all their clients with appropriate 17 documentation, when this thing began to become 18 relevant, 19 your brother. What does that say about what they 20 believe? 21 I did not like that and I had some vigorous inter 22 changes with Guinness & Mahon about that, at the 23 time. It was a case of new people on the block not 24 knowing what the position was. Indeed in Guinness & 25 Mahon, over many years, I have heard people say that 26 the left arm didn't know what the right arm was 27 doing and this is another example of it. 28 my reaction on it is well known. 29 unhappy about i t . sent the documentation to you and not to So I think I was extremely 1 256 Q But they never sent it to your brother. They never 2 thought apparently that your brother was their 3 client, because they never sent it to him? 4 A 5 Well that is a fact. I regard that, as you know, an error on the part of the bank. 6 257 Q 7 A 8 258 Q 9 I understand that. Thank you very much indeed. Am I keeping this. You keep that. There is no difficulty about that. It would be useful for you to go through it and if 10 there is any documents, which are not in that, which 11 you have, would you send them into us? 12 A 13 259 Q I will. JUDGE O'LEARY: Thank you. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN CONCLUDED Lan/vtnuddn/ 0/ 13499 $87,456 7.3%0 Pd? UNDER OATH ON MONDAY, 10TH APRIL 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. MAURICE 0'KELLY Represented by: MR. BRIAN BOHAN BOHAN SOLICITORS 31a WESTLAND SQUARE DUBLIN 2 I WITNESS EXAMINATION MR. M. MS. MACKEY MR. JUSTICE COSTELLO MS. MACKEY 35 38 PAGE 34 37 39 1 2 3 4 MR. JUSTICE COSTELLO: Good morning. 5 MR. O'KELLY: Morning Judge. 6 MR. JUSTICE COSTELLO: My name is 7 Declan Costello and on my 8 right is Ms. Mackey. 9 who were appointed, as you know, by The High Court. We are two of the Inspectors 10 MR. O'KELLY: Sure. 11 MR. JUSTICE COSTELLO: I should explain to you 12 Mr. O'Kelly that this is 13 not a Court. 14 interview. 15 you some questions. 16 MR. O'KELLY: Right. 17 MR. JUSTICE COSTELLO: I want to make it clear It is not a Tribunal. It is an Ms. Mackey and myself are going to ask 18 however that if you have 19 any problem about the questions that we ask you, 20 that you would like to get advice on, you may 21 consult your solicitor and we will stop asking you 22 questions. 23 24 Similarly, if your solicitor has any problem with 25 questions that we might ask he can ask us to stop 26 and consult with you. 27 MR. O'KELLY: Sure. 28 MR. JUSTICE COSTELLO: The evidence will be taken 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 MR. O'KELLY: Sure. 1 2 AS FOLLOWS 3 4 MR. JUSTICE COSTELLO: Mr. O'Kelly, I am going to 5 ask Ms. Mackey to ask you 6 7 some questions. A. Sure. 8 9 MR. MAURICE O'KELLY WAS EXAMINED, AS FOLLOWS, BY 10 M S . MACKEY 11 12 1 Q. 13 A. 14 2 Q. MS. MACKEY: Mr. O'Kelly, good morning? Morning. You provided us with an agreed statement, an unsworn 15 statement, in writing. 16 would be simply to go through that? 17 A. 18 3 Q. 19 I think the simplest thing Sure. And perhaps clarify some of the matters that you have set out in this? 20 A. 21 4 Q. Sure. However, before I do that, for the record, I would 22 just like to get a brief history of your own career 23 and especially your career in Guinness & Mahon. 24 I understand it from your statement you joined 25 Guinness & Mahon in 1971? 26 A. 27 5 Q. 28 A. 29 6 Q. Yes. Is that right? 1971, yes, that is correct. Prior to that you were? As 1 Prior to that I qualified as a chartered accountant 2 in 1955. 3 7 Q 4 A 5 8 Q 6 A 7 9 Q 8 A 9 In 1955? Yes, 1955. Yes ? When I went to -- I went away to Hong Kong. Yes? My partner there died and I took over the firm, which I then sold in 1967, 49% of it. 10 10 Q 11 A 12 11 Q 13 A 14 This is in Hong Kong? In Hong Kong. Yes ? And I returned to Ireland in 1960 and in 1962 I sold the balance of my firm in Hong Kong. 15 12 Q 16 A 17 Yes? And set up a firm in Dublin, Merrion Square, called Commercial Investment Advisers. 18 13 Q 19 A 20 Commercial Investment Advisers? Yes, and that was a company that specialised in the mergers and acquisitions field. 21 14 Q 22 A 23 15 Q 24 A 25 16 Q 26 A 1963. 27 17 Q 1963? 28 A 29 Right? And venture capital field. Yes. That was in...(INTERJECTION)? That company...(INTERJECTION). 1961 you say? Yes. In 1971 that firm was taken over by Guinness & Mahon. The connection there was 1 with Des Traynor who had become Managing Director 2 of G & M and he and I were Articled Clerks 3 we became chartered accountants. 4 same firm as Articled Clerks. 5 18 Q. 6 A. 7 19 Q. 8 A. 9 20 Q. 10 A. 11 We were in the In Haughey Boland? Haughey Boland, that is right. Yes? We were both Articled Clerks under Charles Haughey. Right? Now, my friendship with Des dated from that date, 1951 approximately 1952. 12 21 Q. 13 A. 14 22 Q. 15 A. 16 17 before Around 19? 1951/52 I joined...(INTERJECTION). Haughey Boland? Haughey Boland as an Articled Clerk and that was the time I met Des Traynor for the first time. 23 Q. Right. It was through your acquaintanceship 18 with Des Traynor that the take over of Commercial 19 Investment Advisers? 20 A. 21 24 Q. 22 A. 23 25 Q. 24 A. Yes. By Guinness & Mahon? Yes. Came about, is that right? Yes. It wouldn't have been a very wise move from my 25 point of view because I certainly would have made a 26 lot more money if I continued to own Commercial 27 Investment Advisersright. 28 A. 29 26 Q. And continued to practice. Yes? 1 2 27 Q. 3 A. 4 28 Q. 5 A. 6 With Des? That the acquisition of CIA by G & M in 1971. Right? I joined as Joint Managing Director then in Guinness & Mahon. 7 29 Q. 8 A. 9 30 Q. 10 A. 11 You joined Guinness & Mahon? Yes. As Joint Managing Director? Joint Managing Director with responsibility really for corporate finance. 12 31 Q. 13 A. 14 32 Q. 15 A. 16 33 Q. 17 A. 18 34 Q. 19 A. 20 35 Q. 21 Yes? That particular side of the bank activities. You continued on in Guinness and Mahon then until? I resigned from G & M on 30th June 1985. 1985. What position did you hold at that stage? In G & M? Yes? Just the same. Just Joint Managing Director. Joint Managing Director, that is what you were all the time? 22 A. 23 36 Q. All the time, yes. That is fine. Thank you Mr. O'Kelly. Getting back 24 then to your statement and to what you have just 25 told me, your friendship with Mr. Traynor then dates 26 from the early 1950's? 27 A. 28 37 Q. 29 Yes, we were in Article's together. Yes? 1 38 Q In your statement -- do you have a copy of your 2 statement with you, that you would like to refer to 3 perhaps 4 A 5 39 Q 6 (Exhibit 1)? Yes . If you see paragraph 5 of your statement there Mr. 0'Kelly? 7 A 8 40 Q 9 A 10 41 Q 11 Yes . At the bottom of the first page? Right. You say: "All savings I had and proceeds of sale of shares including (Atlantic Resources) were given to Mr. Traynor in Guinness & Mahon. I had joined Guinness & Mahon in 1971. I had certain moneys at that time and this together with subsequent receipts were lodged with Guinness & Mahon through Mr. Traynor." 12 13 14 15 16 17 A 18 42 Q If you would tell us Mr. O'Kelly how this first came about? 19 20 Yes . A 21 Well, the first -- going back in time I think when G & M 22 43 Q 23 A 24 44 Q 25 A What your first...(INTERJECTION)? bought Commercial Investment Advisers in 1971. Yes? I owned approximately 70% of the share capital. Yes ? At that time the company was owned by Des Traynor, 26 the late Eamonn Andrews and the late 27 Christopher Gore Grimes, in equal percentages. 28 45 Q 29 A Yes? 1 46 Q 2 A And the proceeds of that sale, my share of the 3 proceeds of that sale -- I am not quite sure -- was 4 in an account which would be like a professional 5 firm's account, rather like partners in a legal firm 6 or partners in an accounting firm. 7 47 Q 8 A 9 48 Q 10 A 11 49 Q 12 A 13 50 Q 14 A Yes? If you like an account to my credit. Yes ? With G & M which was paid...(INTERJECTION). In Guinness & Mahon? Yes . Yes? And to that account was lodged my salary from G & M 15 and I wrote my own personal -- no -- yes, to that 16 account and then there was a personal account from 17 which I paid bills and that kind of thing. 18 51 Q 19 A 20 52 Q 21 A Yes ? Yes, and there was debits to that account. Yes? So, that was the nature of that account, which may 22 seem terribly casual. 23 you but I can't explain that other...(INTERJECTION). 24 53 Q 25 A 26 54 Q 27 A 28 55 Q 29 A Yes. It may seem very casual to However, that account was in Guinness & Mahon? Yes . Is that right? Yes . That was an ordinary account in Guinness & Mahon? Well, it was an ordinary -- it was an ordinary 1 account. 2 of I presume that other people had an account like 3 that. It was an ordinary account in the context 4 5 A. But I mean in my case it was in the nature of 6 an account which was a drawing account as well, 7 you know. 8 57 Q. 9 A. 10 Yes? It was rather like if you were a partner in a legal firm . 11 58 Q. 12 A. 13 59 Q. Yes? Or an accountancy firm. Yes. However, in relation to the monies that you 14 gave to Mr. Traynor, when did that arrangement begin 15 and how did that come about? 16 A. 17 That would have been the balance that was due to me from my sale of Commercial Investment Advisers, yes. 18 A. 19 60 Q. 20 A. 21 61 Q. 22 A. 23 62 Q. 24 A. 25 63 Q. 26 A. 27 64 Q. There was an amount due to me. Yes? Which I can't remember now what it was. Yes? At the time. No, that does not matter? But it was probably around £40,000/30,000, you know. Yes? Which does not sound very much. Yes. What happened about that? Did Mr. Traynor 28 suggest to you that it be invested or did you ask 29 him? 1 No, no. 2 just there. 3 like . 4 65 Q 5 Nothing ever happened about it. It was It is just my current account if you However, may be I am not understanding exactly what you are saying? 6 A 7 66 Q 8 A 9 67 Q Yes . You say here at paragraph 5? Right. "I had certain moneys at that time and this together with subsequent receipts were lodged with Guinness & Mahon through Mr. Traynor." 10 11 12 13 When you say "through Mr. Traynor" what do you mean 14 there? 15 A Well, I think that like -- I am not sure 16 whether that would be correct. 17 are really talking about the opening of an account 18 in Guinness & Mahon. 19 68 Q 20 A 21 69 Q 22 A 23 24 I mean you Yes? Whether Des Traynor opened the account for me. Right? Or whether I opened the account after I joined G & M, I am not sure. 70 Q Obviously, what we are concerned here today about is 25 to find out your connection with "Ansbacher" Cayman 26 Limited or "the company" as we refer to it? 27 A 28 71 Q 29 Yes . I think we might cut this thing short by saying that it appears that you acknowledge that you had, in 1 fact, deposits with "Ansbacher" Cayman, is that 2 correct? 3 Well, I don't know what you would mean by having 4 deposits with "Ansbacher". 5 account with "Ansbacher" that I can recall. 6 72 Q I never opened a deposit It appears Mr. O'Kelly that in your interview 7 with Mr. Gerry Ryan, the authorised officer to 8 the Minister? 9 A 10 73 Q 11 A 12 74 Q As a result of which we were appointed? Yes . That you acknowledged to him that you did have an account with "Ansbacher" Cayman, is that correct? 13 14 Yes . A 15 I mean I obviously had because I have been told that I had. 16 75 Q 17 A 18 76 Q 19 A 20 This is what we are trying to get at? But I mean I never signed. No? Put it this way, I never signed a piece of paper saying I wished to have an account. 21 77 Q 22 A Right? With "Ansbacher" and I never authorised the transfer 23 of any money to "Ansbacher". 24 mean...(INTERJECTION). 25 78 Q What we are trying to ascertain today is, how it 26 came about. 27 invest money for you? 28 A 29 79 Q I No. He did not? Did Mr. Traynor at any stage offer to 1 2 80 Q. 3 A. And I wasn't in receipt of any interest that I know of . 4 5 Did...(INTERJECTION)? 81 Q. We will come to that. However, just getting back to 6 the opening of this account, do you say now that the 7 account that you had with Guinness & Mahon is the 8 account that some how or another subsequently was 9 transformed into the "Ansbacher" account? 10 A. Well, all I am saying is that it would appear that 11 an account in my name, which would represent a sort 12 of personal account. 13 82 Q. 14 A. 15 83 Q. 16 A. 17 84 Q. 18 A. 19 85 Q. Yes? Was transferred or opened in "Ansbacher" for me. Right? But I mean...(INTERJECTION). You say in your statement here at paragraph three? Right. "It appears from my statements from Ansbacher (Cayman) Limited that I may have had the benefit of a "back to back" facility." 20 21 22 23 Do you have statements from "Ansbacher" Cayman 24 Limited now? 25 A. a loan. 26 27 Well, back to back facility, that implies that I had 86 Q. No, no. I am not interested just for the moment in 28 the back to back facility. 29 statements. It is simply your You say here you have statements from 1 "Ansbacher" Cayman. 2 possession? 3 MR. BOHAN: Will you just give me a 4 few seconds, I may have 5 the them here? 6 the office. 7 87 Q I am not sure I brought them from These came late. MS. MACKEY: 8 Mr. O'Kelly, where did you obtain these statements 10 from? A 12 I am sure I obtained the statements from Padraig Collery I would think after Des died. 13 88 Q 14 A 15 89 Q 16 A 17 90 Q 18 A 19 91 Q 20 A 21 22 While your solicitor is looking for those 9 11 Do you have them in your Right? Des Traynor died in...(INTERJECTION). 1994? 1994 . Yes ? And it was May. Yes? And I presume Padraig gave them to in after that date. 92 Q Right. (Same handed) (Exhibit 4). 23 these statements begin in 1992. 24 earlier statements? 25 A 26 93 Q 27 A 28 94 Q 29 Mr. O'Kelly Do you have any Do I have any earlier statements. Yes? No, I don't have any earlier statements. Do you have any other documentation provided to you by Mr. Collery in relation to this account? 1 2 95 Q. 3 A. 4 96 Q. 5 Yes? No, I don't, no. Do you have any documentation which Mr. Traynor provided to you? 6 A. 7 97 Q. No, I don't. During the time that you had this account 8 Mr. O'Kelly did Mr. Traynor -- did you receive any 9 statements from Guinness & Mahon about it? 10 A. 11 98 Q. 12 A. 13 99 Q. 14 A. 15 100 Q. 16 A. 17 101 Q. About my current account? Yes? No. The account that you are talking about here? No. That you opened? No. This, you say, as you understood it at the time, was 18 an account in Guinness & Mahon. 19 normally have received a statement? 20 A. 21 From my bank, yes, I am sure I would. 22 102 Q. 23 A. 24 103 Q. 25 26 From my knowledge. Would you not Yes? Yes. How did you know at any given moment what state your account was in? A. I just always knew it was in the black. I mean I 27 know this seems extraordinary to you, and I know I 28 am a chartered accountant, and I know I am supposed 29 to be conscious of looking after money better, but I 1 didn't really need it at the time. 2 which I earned while I was in G & M, and then the -­ 3 when I set up in private practice as a non-executive 4 Director the income fees etc. were more than 5 adequate, you know. 6 104 Q. Like the salary Just getting back again to your statement, you say 7 at paragraph five, if you would just look at it 8 again Mr. O'Kelly, you start off that paragraph by 9 saying: 10 "All savings I had and proceeds of sale of shares including (Atlantic Resources) were given to Mr. Traynor in Guinness & Mahon." 11 12 13 14 That on the face of it appears to say that whatever 15 monies you were lodging you gave to Mr. Traynor, is 16 that the way you went about it? 17 A. 18 I mean that was when I joined G & M in 1971. 19 105 Q. 20 A. 21 106 Q. 22 A. 23 You gave them to Mr. Traynor? Yes, the balance that I had at that particular time. I see? Which came from the sale of Commercial Investment Advisers understand. 24 A. 25 107 Q. 26 A. 27 108 Q. 28 A. 29 Had already given him. Plus the sale of my interest in Hong Kong. Yes? So, I had a certain amount of money. Did you give them to Mr. Traynor personally? Well, sure I gave him -- I gave Des a cheque. Well, he would have given me a cheque I suppose for my 7 0% 1 2 109 Q 3 correct ? 4 A 5 110 Q 6 A 7 8 111 Q What was he doing with that as you understood it? Well, I presume it was on deposit in G & M. A 11 112 Q 12 A 13 Mr. O'Kelly, you say you presume it. However, what Well...(INTERJECTION). That you were giving him the money for? Again, I presumed. I presumed. I mean that is what I did presume. 113 Q 15 When you handed him the money what did you ask him to do? A 17 Well, I presumed it was just on deposit in G & M or on an account in G & M. 18 114 Q 19 A 20 115 Q 21 A I mean...(INTERJECTION). What did you ask him to do Mr. O'Kelly? I didn't ask him to do anything. You just gave him money? And he would have given me some money, wouldn't he, 22 because I sold CIA to G & M? 23 given me some money. 24 gave to him. 25 Ireland in Terenure. 26 I did you understand at that time? 10 16 Yes . mean...(INTERJECTION). 9 14 However, what you had you gave to him, is that 116 Q 27 A 29 117 Q I would have had money which I I had an account with the Bank Of You gave him all your savings, it says here, you say? 28 So, he would have Yes . Yes? 1 2 118 Q 3 A 4 119 Q 5 A 6 120 Q 7 A 8 Which were...(INTERJECTION). What did you ask him to do with those savings? I didn't ask him to do anything. What did he tell you he was doing with them? I don't think he ever told me what he was doing with them. 9 121 Q 10 A 11 122 Q 12 A 13 14 Yes ? I mean I never...(INTERJECTION). Did you think he was keeping them? I am not suggesting...(INTERJECTION). For himself personally? No, no. I thought they were in the bank in an account in G & M. 123 Q That is what I assumed. Can you remember the conversation you had with 15 Mr. Traynor when you handed him over all your 16 savings ? 17 A 18 124 Q 19 A 20 125 Q No, I certainly can't. You cannot? No. You also say in paragraph 5: 21 "I had certain moneys at that time..." 22 23 24 25 You have explained what they are, "...and this together with subsequent receipts were lodged with Guinness & Mahon through Mr. Traynor." 26 27 What do you mean by "Subsequent receipts" 28 Mr. O'Kelly? 29 Well, I would have obtained I presume -- like I made 20 1 money on the shares mentioned above, the Atlantic 2 Resources shares. 3 126 Q 4 A 5 And I can't remember what I made but it was...(INTERJECTION). 6 127 Q 7 A 8 The amount we are not concerned with here? Yes, but it was something like £190,000 and I paid tax. 9 128 Q 10 A 11 After my illness my son paid my income tax. Right? So, then they were the monies that I am referring to . 12 129 Q 13 A 14 15 Yes ? However, what are the subsequent receipts? They would have been the salary from G & M, I presume. 130 Q 16 Your salary from Guinness & Mahon was going into this account, is that correct? 17 A 18 131 Q This current account, yes. When you say it was going into the current account, 19 what happened with your salary cheques? 20 lodged directly? 21 A 22 132 Q 23 A 24 25 To my current account? Or were they given to you? I am sure I had a current account with G&M. Of course I had. 133 Q 26 27 Were they Are we talking about two separate accounts here or one account? A Well, I am not quite sure but we are probably 28 talking about two accounts. 29 account, one would be the balance. One would be my current I mean I am not 1 2 134 Q 3 One, you say, might have been your current account and the other might have been the balance? 4 A 5 135 Q It could be. By the balance do you mean the balance of the sale 6 that was due to you from Commercial Investment 7 Advisers ? 8 A 9 Yes, plus another company that I owned called Simpsons. 10 136 Q 11 A 12 137 Q 13 Yes ? Which I sold in 1982. You think that that might have been in a separate account from your current account? 14 A 15 138 Q 16 A Actually, you know, I don't know but I assume so. Why would you assume that? Well, I would be lodging every month a salary 17 cheque. 18 account by G & M . 19 139 Q It would have been transferred to this Was the salary cheque that was lodged every 20 month lodged directly by Guinness & Mahon, is 21 that correct, or was it given to you? 22 A Well, it wasn't given to me. So, I mean it was 23 either transferred. 24 current account in G & M or it was transfer to my 25 current account in Bank Of Ireland in Terenure. 26 140 Q 27 It was either lodged to that Did you get statements regarding your current account in Guinness & Mahon, regular statements? 28 A 29 141 Q No. You did not? 1 2 142 Q. 3 Guinness & Mahon did not provide you with any statements ? 4 A. 5 143 Q. 6 No. When Mr. Traynor died what did you do then in regard to your account? 7 A. 8 144 Q. 9 A. 10 When Mr. Traynor died? Yes? Well, I understood Padraig Collery transferred the balance. 11 145 Q. 12 A. 13 146 Q. You did not make any enquiries about your account? 14 A. No, Padraig Collery -- I mean Padraig Collery must 15 147 Q. 17 A. 18 14 8 Q. 19 A. I am sure, yes. Why would Padraig Collery contact you about your I presume because he was -- he had responsibility for it within the Bank. 149 Q. 23 Padraig Collery, I think, was not in the Bank in 1994, is that not correct? 24 A. 25 150 Q. 26 I am not sure. I am not sure when he left. As we understand it Padraig Collery left in 1989, left Guinness & Mahon in 1989? 27 A. 28 151 Q. 29 Padraig Collery contacted you? Guinness & Mahon account? 21 22 I didn't do anything. have contacted me soon, quite soon, after that date. 16 20 Just not what you understood, but what did you do? 1989, yes. Mr. Traynor died in 1994? 1 It is quite clear that if Mr. Collery contacted you 2 at that time you could not have thought it was in 3 connection with Guinness & Mahon business, is that 4 not correct? 5 A 6 153 Q 7 8 Well, it was. It was about my account. What would Mr. Collery, who was no longer working with Guinness & Mahon, have to do with your account? A 9 Well, he was obviously looking after it. Des or Niall said he was looking after it. 10 154 Q 11 A 12 155 Q 13 A Would you not find that very strange, Mr. O'Kelly? I do find it strange, yes, when I look back. Did you not at the time? No, at the time. At the time that Des died I was 14 (A) upset with Des, and (B) I just had the stroke 15 about a year and a half at that stage and I don't 16 think I was perhaps handling things too clearly or 17 carefully. 18 156 Q Mr. O'Kelly, from these statements here, that you 19 have given us, it is clear that interest accrued on 20 your account from time to time. 21 the statement? 22 A 23 157 Q 24 A 25 158 Q Right. You acknowledge that I am sure? Sure . It is here on the face of the statements (Exhibit 4 )? 26 27 A 28 159 Q 29 It appears here on Yes . Did you declare that interest to The Revenue Commissioners? 1 2 160 Q 3 A 4 161 Q 5 You do not know? No. You evidence to us is that you do not know whether you did or not? 6 A 7 162 Q 8 A 9 The evidence is that I don't know. Right? Yes. I don't know whether it is significant, whether the interest was significant or not. 10 M R . BOHAN: 11 up with The Revenue 12 Commissioners. 13 MS. MACKEY: 14 Yes. However, it is a matter of fact for us. 15 16 We will be clearing that 163 Q M R . BOHAN: Yes . MS. MACKEY: You made certain 17 withdrawals Mr. O'Kelly 18 from this account? 19 A 20 164 Q 21 Yes . You refer to one here at paragraph 4 of your statement: 22 "The initial withdrawal of £55,000 I do not remember..."? 23 24 A Yes . 25 26 27 28 29 "...and it may have been arranged through Mr. Traynor while I requested any other withdrawals through Mr. Collery"? 1 166 Q The withdrawals that you requested through 2 Mr. Collery, did you request those before 3 Mr. Traynor's death or afterwards? 4 A They would have varied I think because my children 5 were getting married. 6 have five boys and one daughter and I gave the 7 boys some money on their marriage. 8 £30,000 each. 9 167 Q 10 A 11 168 Q 12 A 13 14 I think I gave a load of -- I I think it was Was that before Mr. Traynor's death, before 1994? Well, they got married on different dates. However, were some...(INTERJECTION)? You know we are going back to -- yes, we are going back to like 1988 and 1990. 169 Q 15 What I am trying to ascertain is whether you made withdrawals prior to Mr. Traynor's death? 16 A 17 170 Q 18 A 19 171 Q Both. Both? Before and after. Those that you made before Mr. Traynor's death, did 20 you make them all through Mr. Collery except for 21 this initial withdrawal, or did you make some of 22 them through Mr. Traynor, or can you remember? 23 A I would say they are all through Padraig. Maybe the 24 first one might have been -- I might have said to 25 Des when Michael got married -- I might have said to 26 Des -- I can't remember really. 27 Could you tell me how -- what you did when you 28 required a withdrawal? 29 I just dialled -- told Padraig or Des that -- to 26 1 transfer money to me, to Bank Of Ireland in 2 Terenure. 3 173 Q 4 A 5 174 Q 6 A 7 8 To the Bank Of Ireland in Terenure? Yes . Now...(INTERJECTION)? Maybe it was (inaudible) bank and I transferred it to Terenure. 175 Q 9 Yes. Mr. O'Kelly, can I ask you to look at a document. 10 A 11 176 Q It is page 19 (Exhibit 2) Thanks. Actually, perhaps, page 21 as well. 12 Mary. 13 Mr. O'Kelly? 14 A 15 177 Q 16 (Same handed)? Page 19 for the moment. No, sorry, You see that letter Yes . Which is headed, the heading is slightly blocked out there in the photocopy: 17 "Hamilton Ross Co. Limited, PO Box 887, Grand Cayman, Cayman Islands"? 18 19 A 20 178 Q Yes . I am sorry. The one I am referring to you, the one 21 I am asking you to look at, does not have that 22 heading on it in the photocopy. 23 see at the bottom it is signed: 24 However, you can "For HAMILTON ROSS CO. LIMITED." 25 26 27 Do you see that? A Yes . 28 It is addressed to Ronan Redmond of Irish 29 Intercontinental Bank Limited? 1 2 3 October 1993, it says: 4 "Dear Ronan, Could you please arrange to let us have for collection a Sterling cheque for Stg.£38,085.88 payable to THE MIDLAND BANK and debit the cost to Hamilton Ross Account..."? 5 6 7 8 A 9 181 Q Yes . At the bottom there is a reference: 10 "DPC..." 11 12 Which we understand to be Dermot Patrick Collery, 13 "...Please debit A/A55." 14 And then in handwriting: 15 16 "Cheque posted to MEOK at home..." 17 18 A 19 182 Q Yes . "... 13/10/93" 20 21 A 22 183 Q 23 A Right, yes. Is that a withdrawal that you recollect receiving? Well, I don't recollect receiving it but I mean 24 obviously -- it is obviously related to one of the 25 boys getting married. 26 184 Q 27 A 28 185 Q 29 Right? And my gift to him. To him. page 25. Can I pass you another document and this is (Exhibit 3) (Same Handed)? 1 2 186 Q This is a letter of the 2nd September 1994. Again, 3 it is signed on behalf of Hamilton Ross Co. Limited 4 and addressed again to Irish Intercontinental Bank? 5 A 6 187 Q 7 Yes . With again the reference: "DPC - A/A55" 8 9 at the bottom? 10 A 11 188 Q Yes . This letter asks for Stg.£16,000 to be transferred 12 to The Midland Bank, Poultry and Princess Street, 13 London? 14 A 15 189 Q 16 A 17 190 Q 18 19 Yes . For credit to the account of M. E. O'Kelly? Yes . Was that your account in The Midland Bank Mr. O'Kelly? A I am sure it is, yes. You see The Midland Bank 20 is the -- The Hong Kong & Shanghai Bank took over 21 The Midland Bank. 22 191 Q 23 24 Shanghai Bank? A 25 26 You had an account there, with The Hong Kong & My account was with The Hong Kong & Shanghai Bank and then they took over The Midland Bank. 192 Q 27 Is that another withdrawal that you would have made at that time? 28 A 29 193 Q I am sure it is, yes. Yes? 1 2 194 Q 3 A 4 Yes ? 1992/1993 to 1995, that I did resign. I did give up several of my directorships. 5 195 Q 6 A 7 196 Q 8 A 9 Yes ? Because of my health at that particular time. Yes? So, two things happened over that particular period, 1993 to 1998. 10 The two significant things, from my personal point of view, were first my stroke. 11 197 Q 12 A 13 Yes ? And I resigned two or three of my directorships as a result of it. 14 198 Q 15 A Yes? And in addition a firm of which I am Chairman in 16 Waterford, Waterford Stanley Limited, the Financial 17 Director lost something like £4.3 million in foreign 18 exchange speculation at that time and there was no 19 dividends in Waterford Stanley for a period of three 20 years. 21 199 Q 22 A 23 200 Q 24 A 25 26 I think it is from 1997 on. Mr. O'Kelly, if I -- not to interrupt you there? Not at all. Not to interrupt you there but...(INTERJECTION)? I am just trying to tell you, explain, why I needed such large amounts that is all. 201 Q 27 Yes. We are not really concerned with the reasons why you needed them? 28 A 29 202 Q Fine . 1 2 203 Q 3 A 4 204 Q Sure . It appears that in 1993 your account was transferred 5 from "Ansbacher" to Hamilton Ross & Co. Limited. 6 Are you aware of that? 7 A 8 205 Q 9 A No, I wouldn't have been aware of that at the time. You were not aware of that? I mean -- sorry, I mean I understand how 10 Hamilton Ross came into the picture but I wasn't 11 told it was being transferred there or anything 12 relating to it. 13 206 Q Yes. Were you aware Mr. O'Kelly that your account 14 was one of the coded accounts in Guinness & Mahon, 15 coded A/A55? 16 A Well, I am sure I was aware of it but I mean I 17 wouldn't have attached any particular significance 18 to that. 19 207 Q 20 A 21 Like I mean I just thought that was an account number. 22 208 Q 23 A 24 25 Yes? You thought A/A55 was an account number? Yes, I mean it wouldn't have registered with me as being peculiar in any way. 209 Q When would you have become aware that was...(INTERJECTION)? 26 27 A 28 210 Q 29 A I didn't become aware until...(INTERJECTION). An account number? 1 211 Q No, no. When were you -- when did the number A/A55 2 become known to you? 3 it at the time? 4 A Were you aware -- did you know I don't think it ever became known to me insofar as 5 I never made a note of it or anything but I did 6 become aware of the fact that -- subsequently I 7 heard, it must have been from Padraig Collery or 8 somebody, that I was in an account holder, there was 9 other people in the same account or something. 10 212 Q 11 You became aware that you were in an account with others ? 12 A There was other people in the same account. 13 213 Q That other people were in the same account? 14 A 15 214 Q 16 A 17 I gather. Did Mr. Collery tell you that? I think it was. It couldn't have been anybody else I don't think. 18 215 Q 19 A When would that have been? I don't know. It must have been around about after 20 Des died. 21 when I became aware of the fact that there was 22 some account, either in G & M or in Cayman, where 23 CJ Haughey and myself and somebody else were in the 24 same account. 25 You were aware at that stage that it may have been 26 in Cayman? 27 No, I wasn't aware it was in Cayman. 28 aware I was in the same account at CJ and somebody 29 else in 1996 or 1997. It must have been around about 1995/1996 I was just 1 217 Q 2 3 What did you ask Mr. Collery about that when he told you? A 4 5 Right. I didn't ask him anything about it. There was nothing to be asked about it. 218 Q Did it not seem strange that you thought your money 6 was in a current account in Guinness & Mahon and now 7 it appeared that it was in a joint account with 8 other persons? 9 A 10 It wasn't a joint account. It was just that I was in the same account. 11 219 Q 12 A 13 14 Not a joint account. However, can you explain that to me a little bit? I can't explain it to you and if you can explain it to me that would be fine. 220 Q 15 However, you must surely have questioned Mr. Collery about that? 16 A 17 221 Q 18 A Well, I asked him how did it arise. Yes ? And he said it was for convenience, something to do with the transfers or something. 19 20 222 Q 21 A That it was something to do with the transfers? Yes, like I can't remember in what words he 22 explained it to me but he had an explanation for it 23 at the time, it was convenient for something or 24 other. 25 223 Q 26 A 27 224 Q You cannot remember that now, is that right? I don't know what the explanation was. If I could summarise Mr. O'Kelly, is it the case 28 that you gave money to Mr. Traynor. 29 understand it, is a summary of your evidence here This, as I 1 today: 2 1971 onwards; you were not aware of what he did with 3 it; you did not ask him to do any particular thing; 4 it now appears that that money was on deposit with 5 the company known as "Ansbacher" Cayman Limited; the 6 money earned interest over the years; you do not 7 remember whether you declared that money, the 8 interest, to The Revenue or not; you made certain 9 withdrawals by contacting either Mr. Traynor or You gave money to Mr. Traynor from about 10 Mr. Collery, including Mr. Collery at a time after 11 he had left Guinness & Mahon. 12 correct summary of your evidence today? 13 A. Would that be a Well, with regard to it that it seems very 14 extraordinary for a chartered accountant to behave 15 in this fashion then I would believe -- I would 16 agree that it is a correct summary of the events. 17 225 Q. Very good. I have no further questions Mr. O'Kelly. 18 END OF EXAMINATION OF MR. MAURICE O'KELLY BY 19 M S . MACKEY 20 21 22 23 24 25 26 27 28 29 1 2 3 4 226 Q. MR. JUSTICE COSTELLO: Just in relation to the 5 payment of tax 6 Mr. O'Kelly, did you look after your own tax affairs 7 or had you an accountant? 8 A. 9 227 Q. 10 A. No, they were always looked after by an accountant. Who was that? What was his name? Well, wait until I see. There was two. There was 11 the auditors to Simpsons, which was a firm that I 12 bought in 1962. 13 Dury Street that I bought before I started CIA and I 14 sold it in 1982. 15 228 Q. 16 A. 17 229 Q. 18 A. Can you remember the name of the firm? I am just trying to think. It was...(INTERJECTION). What was their...(INTERJECTION)? Dodd. Christopher Dodd, Chris Dodd was the...(INTERJECTION). 19 20 230 Q. 21 A. 22 231 Q. 23 A. 24 232 Q. 25 A. 26 233 Q. 27 A. 28 29 It is a printing firm in Chris Dodd? Yes. Who else did you have then? But it was Dodd something. Yes? G-r-e-h-a-n Dodd. He had died. Yes? Grehan Dodd & Company. Street. 234 Q. Grehan Dodd, sorry. Yes? They were in O'Connell 1 And they were the auditors to Simpsons. 2 was my connection with them. 3 235 Q 4 A So, that They were you own personal accountants? They -- yes, they looked after my personal tax, yes, 5 until I left G & M in 1985 and I had my offices. 6 do still have my offices located in Baggot Street, 7 and in the building of a friend of mine called 8 Brendan Sherry, who operates as a chartered 9 accountant. I He has a chartered accountancy firm and 10 I transferred my tax in that year to be looked after 11 by the taxation expert in Sherry O'Connor. 12 just trying to think of his name for a second. 13 236 Q 14 A Yes? Any way that is the name of the firm that looked after it. 15 16 I am 237 Q 17 Either then Grehan Dodd or Brendan Sherry's records would show...(INTERJECTION)? 18 A 19 238 Q 20 A 21 239 Q Yes, they complete my annual tax returns every time. They made your returns? Yes . They could establish whether or not there was 22 included in your returns any interest you have 23 earned? 24 A 25 240 Q 26 A That is correct. Have you made enquiries? I haven't made enquiries. I don't think it is 27 material. 28 mean -- when I say that I mean it may appear very 29 casual or very careless but I don't think the I don't think it is very large now. I 1 2 241 Q There as a fairly substantial sum of money to 3 the credit of this account, 4 in 1992, is there not? 5 A 6 Yes, I am sure there is. "Ansbacher" account, Is there? I can't remember. 7 242 Q 8 A 9 243 Q 10 A 11 244 Q 12 A 13 245 Q There is? Yes . A substantial sum? Yes . And interest would be substantial on that per annum? The interest would be substantial, would it? What I am asking is, as I understand it, you do not 14 know whether or not you returned those for income 15 tax? 16 A 17 246 Q 18 A 19 247 Q That is correct. Have you made enquiries from your accountants? No. Yes. Very well. 20 END OF EXAMINATION OF MR. MAURICE O'KELLY BY 21 MR. JUSTICE COSTELLO 22 23 24 25 26 27 28 29 1 2 M S . MACKEY 3 4 248 Q MS. MACKEY: Just one other matter 5 Mr. O'Kelly? 6 A 7 249 Q Yes . We required you in our letter to you to produce to 8 us all documents in your possession. 9 just today you produce to us the statements from 10 "Ansbacher". 11 possession whatsoever? 12 13 A I am sorry. Now, in fact, Have you any other documents in you I thought you had them. MR. BOHAN: 14 Yes, we did get some other documents. There is 15 roughly the same as you have and now, that was my 16 fault and I apologise. 17 MS. MACKEY: 18 19 We require everything you possess please. M R . BOHAN: 20 I will get it down to you. I apologise for that. 21 MS. MACKEY: Yes. 22 MR. JUSTICE COSTELLO: We require every document 23 Thank you very much. that Mr. O'Kelly has given 24 to you. 25 M R . BOHAN: 26 Yes. I will make sure you get it today. 27 MR. JUSTICE COSTELLO: Yes . 28 MS. MACKEY: Have you written 29 Mr. O'Kelly to "Ansbacher" 1 Cayman in connection with your account and asked 2 them for documents? 3 No. 4 251 Q 5 A 6 252 Q Would you do that please? Write to "Ansbacher" in Cayman? To "Ansbacher" Cayman and to Hamilton Ross and ask 7 them for any documents that they may have in 8 relation to your account, A/A55? 9 MR. BOHAN: Sorry, we will do that. 10 MS. MACKEY: Thank you. 11 MR. BOHAN: Yes. 12 END OF EXAMINATION OF MR. MAURICE O'KELLY BY 13 M S . MACKEY 14 15 MR. JUSTICE COSTELLO: Thank you Mr. O'Kelly. 16 This evidence given today 17 with be transcribed and we would ask you to come in 18 to sign the transcript of the evidence? 19 A 20 Sure . MR. JUSTICE COSTELLO: If you would like to stay 21 on now and have a cup of 22 coffee you can, you might prefer to leave however. 23 MR. BOHAN: 24 A Thank you very much. Thank you. 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED anti So vi u?xln!? \Sxxk him Wm wkes- 1000 UNDER OATH ON WEDNESDAY, 16TH FEBRUARY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. MARTIN KEANE Instructed by: MR. BOYCE SHUBOTHAM William Fry Solicitors Fitzwilton House Wilton Place Dublin 2. 1 2 3 4 MR. JUSTICE COSTELLO: 5 Good morning, Mr. Keane, my name is Declan Costello 6 and on my right is Ms. Mackey and on my left is 7 Mr. Rowan, as you know we have been appointed 8 inspectors by the High Court. 9 solicitor, Ms. Cummins, to administer the oath to 10 I will ask now our you. 11 12 MR. KEANE, HAVING BEEN SWORN, WAS EXAMINED AS 13 FOLLOWS BY MR. JUSTICE COSTELLO 14 15 1 Q. MR. JUSTICE COSTELLO: 16 Mr. Keane, I am sure your solicitor has explained to 17 you that we are not a court and we are not a 18 tribunal, we are inspectors appointed by the High 19 Court. 20 sure is a proper practice, that we do not object, in 21 the slightest, to witnesses bringing solicitors or 22 legal advisers with them. 23 which you think a question is one which you should 24 not be required to answer, for one reason, for 25 example that it is not relevant or it is not within 26 the terms of the Court, you can so indicate to me 27 and you can discuss the matter with your solicitor. 28 If your solicitor thinks that we are asking a 29 question which you are not required to answer, he We have adopted the practice, which I am If there is a point at 1 can so indicate to me and I will stop and he can 2 talk to you about it. 3 operate. That is how we propose to 4 5 I should explain, however, whilst we cannot make a 6 ruling as to the admissability, the preparatory of 7 the question, we may have to reach a situation where 8 we regard your decision not to answer the question, 9 for reasons which you consider valid, as amounting 10 to a refusal to answer the question and we would 11 then have to consider having the matter brought 12 before the Court. 13 be adopted here today. That is the procedure which will 14 15 Mr. Keane, it would be helpful if you could briefly 16 indicate firstly to me your professional 17 qualifications and briefly your curriculum vitae in 18 your profession? 19 A. I am a chartered accountant and I qualified as a 20 chartered accountant in 1972, in what is now KPMG, 21 SKC as was it known then. 22 2 Q. 23 A 24 3 Q 25 A 26 4 Q 27 A Strokes Kennedy Crowley? Strokes Kennedy Crowley. In when? 1972 . You qualified? I qualified and I left SKC in that year and I joined 28 Guinness & Mahon as a junior corporate finance 29 executive. I worked in Guinness & Mahon from 1972 1 until 1988 when I left Guinness & Mahon. 2 I have been employed by Ernst & Young, chartered 3 accountants, and my current position there is 4 director of corporate finance services. 5 has been in corporate finance, essentially. 6 5 Q. Since 1988 My career We are concerned now, particularly with the company 7 that is now known as Ansbacher, and we are concerned 8 with obtaining from you assistance as to the 9 services which Ansbacher operated here in Dublin and 10 I particularly want your assistance in relation to 11 the establishment of trusts in Cayman, in respect of 12 which the Ansbacher may have been the trustee or 13 management company and how the whole system was 14 established and how it worked and if you could give 15 us, in considerable detail, your knowledge of it? 16 A. I think it might be helpful to you if I just 17 outlined where roughly, over time, my role was in 18 relation to the whole Ansbacher affair and the 19 various off-shore companies that were subsidiaries 20 of the bank. 21 a junior corporate finance executive. 22 dealings with any of the off-shore operations of the 23 bank until, I believe, about 1974. 24 there was, in existence, Guinness & Mahon Cayman 25 Trust, which is now known as Ansbacher 26 Ltd., I understand. 27 company which had been established in 1972 by the 28 name of the Guinness & Mahon Jersey Trust Ltd., 29 which was a trustee company, which I came into As I say, I joined the bank in 1972 as I had no At that stage (Cayman) There was also in Jersey a 1 contact in 1974. 2 been established in Guernsey a company by the name 3 of Guinness & Mahon Channel Islands Ltd. 4 background to all of that was, as I understand it, 5 that in 1972 there was changes in the definition of 6 the scheduled territories, which made up the 7 sterling area and my understanding is Cayman went 8 outside the sterling area. 9 place where Mr. Traynor had established a subsidiary I think in 1974 there also had The Cayman had been the 10 on behalf of the bank, known now as Ansbacher 11 Cayman. 12 used, except by virtue of exchange control 13 regulations and he set up, I was not involved in the 14 setup of it, a company in Jersey, which was just a 15 pure trust company, by the name of Guinness & Mahon 16 Jersey Trust Ltd. 17 someone in the bank at that time, who was also a 18 director of the bank, by the name of Chris Dodd. 19 6 Q. 20 A. 22 7 Q. 23 A. 25 He was assisted in that by If I could interrupt you, what do you mean by "just a trust company"? 21 24 It was now not possible for this to be 8 Q. A. It wasn't a bank, it was just a trustee company. It acted as trustee? And company management services. Yes. The first time I came into contact with any of these 26 entries really was in 1974. 27 bank and I believe, I think, in that year 28 Mr. Traynor had suffered a heart attack. 29 Mahon Jersey Trust had, at that point, a Mr. Dodd had left the Guinness & 1 considerable number of trusts which had been 2 established in the Channel Islands and there were a 3 significant number of companies there as well. 4 that time Guinness & Mahon Jersey Trust didn't have 5 a secretariat, as such, in the Channel Islands. 6 registered office of the company was at the house of 7 the son of a former client of Mr. Traynor's and I 8 think they used local firms of accountants in Jersey 9 to supply formation services and secretarial type At The 10 services. 11 Mr. Traynor to go over, in essentially an 12 administrative role, to look after those companies 13 to make sure the returns were properly filed and to 14 make sure they paid their local taxes. 15 stage there were, I can't remember how many now, but 16 a significant number of trusts had been 17 established...(INTERJECTION). 18 9 Q. 19 A. So, I, at that stage, was asked by At that Approximately how many? I would say maybe 25 to 30. At that stage, also, 20 the bank had, in Dublin, a large number of what I 21 would call old trusts of the kind of marriage 22 settlement or will trust nature, some of them which 23 were Irish others which had moved their residence 24 from the UK to Ireland in the '60's when capital 25 gains tax came into the UK in the '60s. 26 Mahon Executor and Trustee Company, Ireland would 27 have been the trustee to a lot of these settlements. 28 In 1974 capital gains tax was introduced to Ireland 29 in 1974 and a lot of these trusts wished to move Guinness & 1 residence yet again to the Channel Islands, or some 2 suitable jurisdiction for the purposes of avoiding 3 capital gains tax, is my understanding. 4 event, Mr. Traynor and Mr. Dodd, I believe, at that 5 time, were in the process of applying for a full 6 banking licence for a company which had been 7 incorporated in Guernsey by the name of Guinness & 8 Mahon Channel Islands Ltd. 9 departure I was involved in some meetings with So that After Mr. Dodd's 10 directors of the parent bank in London and I think 11 at least one meeting with the financial 12 establishment or regulator in Guernsey. 13 course -- the intention was that this would be set 14 up as a full bank in Guernsey which would also carry 15 out trustee services. 16 obtained, 17 that there was, I think, a downturn in business, the 18 whole project was reviewed. 19 it suddenly looked like being far more expensive to 20 set up in Guernsey than people had originally 21 envisaged and it was decided not to proceed with it. 22 The licence was, I believe, relinquished and handed 23 back to the Guernsey Authorities. 24 10 Q. 25 A. 26 11 Q. 27 A. In due A banking licence was duly I believe, in 1974, however subsequent to On the grounds of costs Do you know when was that? I think approximately, end of 1974. 1974, as soon as that? Yes, it could have been early 1975. So the 28 situation at that point was that there was this 29 demand from the old trusts back in Dublin who were 1 seeking a permanent establishment, the bank had a 2 permanent establishment within the sterling area, 3 but off-shore and there were these companies which 4 had been set up in Jersey and trusts which had been 5 previously set up in Jersey which really didn't have 6 any permanent establishment or secretariat to look 7 after to administer them. 8 9 Among these old trusts were trusts connected to the 10 Guinness family, in that I mean primarily Mr. James 11 Guinness, who was then the Chairman of Guinness & 12 Mahon & Co., which was the parent company of 13 Guinness & Mahon Ltd. 14 sequence of events, but they were very keen to have 15 proper managers in place in one of these places and 16 they came in contact, through some mutual 17 acquaintance, with a Mr. John Lipscombe who ran a 18 trustee company in Guernsey, by the name of 19 Sovereign Management, which was a privately owned 20 trustee company. 21 arising from this various meetings that took place 22 in Guernsey and I think subsequently in Dublin with 23 Mr. Traynor. 24 in Dublin would establish a subsidiary by the name 25 of College Trustees in Guernsey, which subsidiary 26 would rent some space from Mr. Lipscombe's 27 organisation and entered into a contract with 28 Mr. Lipscombe's organisation to supply management 29 services to these trusts and company management I can't remember exactly the He had a good reputation and It was decided that Guinness & Mahon 1 services. 2 old trusts that were in Dublin, and the trusts that 3 had been established in Jersey were all transferred 4 from Guinness & Mahon Jersey Trust and from Guinness 5 & Mahon Executor & Trustee in Dublin to College 6 Trustees as trustee. 7 12 Q I believe subsequent to that a lot of the Just so I understand, I think you made it clear, 8 when you say "transferred" you mean that the trustee 9 was changed to College Trustees? 10 A I think the trustee was changed, may be not in all 11 cases, but in most cases, certainly in the ones 12 where Dublin was a trustee. 13 13 Q 14 The intention being that the company that would act as trustee would be College Trustee? 15 A 16 14 Q 17 A 18 15 Q Yes, and would act as the company manager. And would also act to manage the trust as well? Manage the companies underlying the trust. We will come to that later. Just again, I am sure 19 you cannot be definite but just how many companies, 20 old trusts, that were moved from Dublin? 21 A 22 It is not a large number but they were fairly substantial trusts. 23 16 Q 24 A The numbers weren't large? The numbers wouldn't be large, six to ten, they 25 would be very substantial and very heavy from an 26 administrative point of view, they would probably 27 have had investment portfolios and the like. 28 Yes. 29 My role in that period was on the instruction of Continue then. 10 1 Mr. Traynor to try and -- my role was involved in 2 the organising of all that and the organising of the 3 transfer and looking at the overall -- making sure 4 that the overall administration was up to date and 5 the returns were filed on time. 6 18 Q. 7 8 You, in fact, were a director of College Trustees, originally? A. 9 At the date of incorporation, purely at incorporation, 10 I checked that and I was not, purely for the purpose of incorporation. 11 19 Q. 12 A. That explains it. Continue then Mr. Keane. That is the point at which all the Channel Islands 13 activities came together under College Trustees 14 which I think was a subsidiary of Guinness & Mahon 15 Channel Islands. 16 Guinness & Mahon Dublin owned one hundred percent of 17 Guinness & Mahon Channel Islands, which in turn 18 owned one hundred percent of College Trustees, which 19 had a management arrangement with Sovereign. 20 that time, most of the client companies that had 21 been set up in Jersey had deposits back in Dublin in 22 the name of the normal -- when I came across it, the 23 normal structure appeared to have been that there 24 was a trust with an underlying company. 25 trusts that had been set up in Jersey had 26 Christopher Woodward as the settlor, who was the 27 gentleman whose house was used as the registered 28 office, the son of the former client of Mr. Traynor, 29 who was a director of Guinness & Mahon Jersey Trust. So we now had the situation where At Most of the 1 2 3 20 Q. 4 You say the trust had underlying companies. 5 A. 6 21 Q. 7 Yes. Was it the trust just owned one hundred shares or something like that of the company? 8 A. 9 22 Q. 10 A. 11 23 Q. 12 A. Yes. All the funds were in the company? In the company. And the company then managed the funds? Yes, the company placed them back on deposit with Dublin. 13 14 If you just take it a little slowly. 24 Q. That is what I want to get at. Were all the funds placed back in Dublin? 15 16 A. 17 25 Q. 18 A. My recollection is yes. In whose name were the funds placed? The funds, at that point, my recollection is that 19 the funds were in the name of the individual 20 underlying company. 21 2 6 Q. The underlying company? 22 A. The underlying company. 23 27 Q. 24 25 We will come to these later. These were the coded accounts, were they? A. No, at this point they were just X, Y, Z 26 investments, whatever, the actual names of the 27 company. 28 29 28 Q. Of the company? 1 29 Q 2 trusts, was he? 3 A 4 30 Q 5 6 Very well Mr. Woodward was the settlor in all these That is my memory of the ones I came across. Did you see who the clients were who instructed Mr. Woodward to be the settlor? A 7 Not initially, I became aware of some of them as time went on. 8 31 Q 9 A 10 32 Q Yes. Were these discretionary trusts? My memory is yes. You became aware of who the beneficiary was and who 11 was able to give instructions as to how the funds 12 were dealt with? 13 A 14 I can't exactly say how I became aware from various bits of information. 15 33 Q 16 A If you continue then, Mr. Keane. So, I think at point -- some point after that -- I 17 think during that period, which is roughly from 18 about 1974 to I think about 1976, 1975/76 is the 19 period when all this was going on about Guinness & 20 Mahon Channel Islands, the setting up of College. 21 think some more companies may have been incorporated 22 in Jersey and they may have been added to the trust. 23 I think there was a certain amount of shelf 24 companies that had been formed by Mr. Traynor, so 25 there may have been some companies added to the 26 Jersey stable, if you like. 27 34 Q 28 A 29 35 Q What function would they have? What function? Yes . I 1 They would be for further -- my recollection is that 2 there were a large number of trusts there which were 3 shelf type trusts where they were set up by 4 Mr. Woodward and there may have been companies which 5 were subsequently formed to go with them. 6 36 Q When you say "shelf", you mean that they were there 7 available for anybody who wanted them, they were not 8 operative? 9 A 10 37 Q That was between 1974 and 1976? 11 A I think that is my memory, yes. Weren't operative, yes. Some more may have 12 been allocated to clients by Mr. Traynor at that 13 time. 14 decided that he was the going to change the system 15 in Dublin in relation to the deposits in the 16 individual companies which were appearing as 17 individual deposits. 18 whereby from some date around then that they were 19 now coded, still individual deposits on the books of 20 the bank but now known as Guinness & Mahon Channel 21 Islands A, B, C, D, or whatever, some number. 22 38 Q 23 I think some time around 197 6 Mr. Traynor He instituted a system, The name in the company was Guinness & Mahon Channel Islands Ltd. was it? 24 A 25 39 Q 26 A In the books of the bank. 27 40 Q In the books of the bank? 28 A 29 Yes . That was the name of the depositor? In the books of the bank, that is my memory, yes. think it was acting as a nominee really. I 1 41 Q. You see there was Guinness & Mahon Jersey Trust Ltd. 2 and that had gone, more or less, to fund College 3 Trustees ? 4 A. 5 42 Q. 6 A. 7 43 Q. 8 A. 9 44 Q. As the depositor? 10 A. As the depositor. That's correct, yes. There was Guinness & Mahon Channel Islands Ltd. Which was not trading. Which was not trading but its name was used? Its name was used, yes. So if we had, let's say 30 11 depositors in different names they now became 12 Guinness & Mahon Channel Islands A, B, C. 13 45 Q. 14 A. 15 46 Q. 16 A. With the code? With the code, yes. If you continue then. I think, what happened after that, some point after 17 that those deposits I think there were some new 18 clients from College Trustees, there were some new 19 clients in College Trustees in that period, in the 20 mid/late '70's College took on new clients which 21 would have been introduced, largely, by Dublin I 22 expect. 23 bureau system was instituted, 24 correct date. 25 47 Q. At some point, I think, around 1979 the I think that is the It may have been instituted, but we have letters 26 from Mr. Lipscombe from the Channel Islands in 1978 27 and also Mr. Furze at the same time? 28 A. 29 48 Q. That's the start of the bureau system. That was the start of the bureau system. 1 A. 2 The bureau system is quite different in the sense that...(INTERJECTION). 3 49 Q. 4 A. You perhaps might describe it to us now? My understanding of it, I wasn't involved in the 5 setting up of it, but my understanding of it was 6 that the, whereas previously in the case of the 7 Channel Islands there were a whole series in the 8 bank of individual deposits, albeit coded A, B, C, 9 D, they were all amalgamated into one deposit, and 10 that, in the ordinary books of the bank, was the 11 only deposit that was visible and the arrangement, 12 which had been entered into with College, was that 13 the tracking of those deposits, the underlying 14 deposits making up the large deposit, would be 15 maintained on a separate system by Dublin for 16 College Trustees and I believe similarly for Cayman, 17 and what has subsequently been known as the bureau 18 system, to which only, I think, at that time it may 19 have been Mr. Ru Leonard who was the manager of the 20 accounts department in the late '70's, he was 21 subsequently succeeded by Mr. Collery. 22 people who had access to the bureau system were 23 either Mr. Leonard, at the appropriate time, or 24 subsequently Mr. Collery or Mr. Traynor. 25 access to it. 26 50 Q. The only I had no Before that, however, you seemed to have been the 27 person who had access because we have a note on a 28 ledger saying that information can be sought from 29 you? 1 Yes, Mr. Ryan, the authorised officer, brought that 2 up with me. 3 have racked my brain on it since then and I think 4 what it in effect was saying was that, in effect, 5 outside of Mr. Leonard, or whoever controlled the 6 accounts department, or Mr. Traynor, the only other 7 person who could have access to those accounts was 8 me. 9 51 Q 10 A 11 52 Q 12 A I am somewhat surprised by it and I Whatever the note said, you in fact had access? To the Channel Islands, to the GMCI ones? Yes ? I had access. At that stage I knew who some of the 13 clients were. In a lot of cases it was a refer to 14 Mr. Traynor, situation. 15 53 Q And that altered when the bureau system was 16 established and it was Mr. Leonard and later 17 Mr. Collery? 18 A 19 54 Q 20 A That's right. If you continue then. We are now at about 1978/7 9, at that stage my memory 21 is that Mr. Lipscombe started to deal directly with 22 most of the Irish clients, by and large. 23 think my recollection is, from my awareness anyway, 24 that there were probably very few new clients going 25 into College around that time, it doesn't mean there 26 were not, but to my knowledge there were not, but 27 there may have been direct dealings between 28 Mr. Traynor and Mr. Lipscombe or directly between 29 Mr. Lipscombe and...(INTERJECTION). I do not 1 55 Q At this stage, 197 9, what would your estimate be of 2 the number of clients that were involved, the number 3 of separate deposits in the bureau system? 4 A 5 56 Q 6 7 It is very difficult, but maybe 50. What do you mean to say Mr. Lipscombe was dealing directly with the Irish clients? A I think at that stage from Mr. Lipscombe -- from my 8 own personal point of view I had no wish to be 9 dealing, if people had affairs which were with 10 College Trustees I preferred that they were dealt 11 with by College Trustees. 12 executive, 13 1974/76 and my main job in the bank was acting in 14 corporate finance. 15 my corporate finance activities and leave the 16 Channel Islands activities. 17 57 Q I was a corporate finance I got dragged into this thing back in My position was to get on with I just want to understand how you understood 18 Mr. Lipscombe operated in relation to the monies 19 that were on deposit in Guinness & Mahon, how did it 20 come about? 21 A 22 58 Q 23 A How did it come about? What would he do, how would this be operated? Again, I had some discussion with -- my 24 recollection is that there were intercompany 25 accounts between the bank in London, that there 26 would have been intercompany accounts from London 27 because it was mainly sterling balances and I think 28 the large deposit that represented the bureau, 29 collected accounts, was still back in Dublin. I 1 think if some of the clients, if you wanted to get 2 money to some of the clients in Dublin communication 3 would issue by telephone, or otherwise, or direct 4 from the clients that they wished to collect some 5 money and that money might be provided to them in 6 Dublin, they would call in and collect it. 7 59 Q. I want to find out how it operated. When you say 8 there were intercompany accounts with London, what 9 were the companies that were interconnected? 10 A. I think they would just be the normal intercompany 11 accounts like Guinness & Mahon Dublin's account with 12 London. 13 Guernsey came into it which was set up some time 14 later, which was owned by the London bank. 15 wasn't involved in that kind of interbank side of 16 it, I am very hazy on it. 17 like Guinness & Mahon all of the subsidiaries would 18 have accounts with the parent, clearing type 19 accounts, but the exact nature of the 20 accounts...(INTERJECTION). 21 60 Q. I think, at some stage, Guinness & Mahon Really I Normally within a bank To come back to what you told us a moment ago in 22 relation to the clients who wished to obtain funds, 23 what would they do, did you say? 24 A. I think in some cases, at that stage, I would have 25 had an awareness of who some of these beneficiaries 26 and clients were, which knowledge would have 27 increased over time from various points, or it could 28 have been an instruction from Mr. Traynor or a 29 request from Mr. Lipscombe that Mr. X would like to 1 get some money: 2 occurred, 3 there was the GMCI accounts 4 di re ct debit. 5 have bee n Ru Leonard, 6 Mr. 7 61 Q. 8 A. 9 62 Q. 10 A. P l e a s e g i v e Mr. X £ 5 , 0 0 0 . If t h a t I t h i n k if it o c c u r r e d i n t h e p e r i o d w h e n it m a y h a v e b e e n a It m i g h t n o t h a v e b e e n m e it m i g h t it m i g h t h a v e b e e n Traynor. You were i n v o l v e d some of the time? To some degree, yes. Tell me what happened? Let's s a y t h e r e w a s a p e r s o n w h o w a s w e l l k n o w n to 11 t h e b a n k a n d w e k n e w he w a s c o n n e c t e d w i t h t h e - ­ 12 Mr. 13 £5,000, 14 w o u l d call in an d c e r t a i n l y o n c e the b u r e a u s y s t e m 15 h a d b e e n set u p I w o u l d j u s t d e b i t it t o h i s e x p e n s e 16 a c c o u n t a n d i n f o r m Mr. 17 63 Q. 18 L i p s c o m b e r a n g a n d said: h e w o u l d c a l l it in, Mr. X w a n t s to get g i v e it t o him. He C o l l e r y t h a t I h a d so done. You would actually physically hand him over a cheque or cash? 19 A. 20 64 Q. 21 C a s h or what e v e r , A n d y o u w o u l d p u t it i n t o h i s e x p e n s e a c c o u n t a n d Mr. 22 A. 23 65 Q. yes. C o l l e r y w o u l d t h e n d e a l w i t h it? Yes. F r o m w h a t y o u knew, I would imagine you would have 24 k n o w n f a i r l y q u i c k l y t h a t h e p u t it t h e r e a n d he 25 d e a l t w i t h it i n a c c o r d a n c e w i t h t h e cod e . 26 was £5,000 there w ould have been deduction? 27 A. 28 66 Q. 29 If it is He w o u l d n o w k n o w the a p p r o p r i a t e code account. S o y o u r i n v o l v e m e n t w a s as a n o f f i c i a l i n t h e b a nk, 1 2 T h a t w a s p a r t o f it, 3 h a p p e n e d on a v er y re gu l a r basis. 4 c o n t i n u i n g -- t h e r e w a s s o m e s m a l l a d m i n i s t r a t i v e 5 role on a c o n t i n u i n g b asis w it h C ol l e g e Trustees, 6 the accounts, 7 w o u l d b e a g r e e d e a c h y e a r w i t h Mr. 8 67 Q 9 A I wouldn't say that that There was a t h e s t a t u t o r y a c c o u n t s of C o l l e g e Lipscombe. W e r e y o u i n v o l v e d in t h a t ? I w o u l d m a y b e r e v i e w t h e m w i t h Mr. Lipscombe, but 10 that w o u l d be on a p u r e l y c o m p a n y basis ra the r than 11 on the basis of i n di vid ua l 12 s u m m a r i s e s t h e m o s t of it. 13 68 Q 14 15 I t hink that T h i s p o o l e d d e p o s i t a c c o u n t w a s i n t h e n a m e of Guinness A clients. & M a h o n G u e r n s e y Ltd. I t h i n k at o n e p o i n t it was. w a s it n o t ? I think my 16 r e c o l l e c t i o n o f t h a t is t h a t s o m e t i m e i n t h e l a t e 17 ' 7 0's o r e a r l y 18 b a n k i n G u e r n s e y to r e a c t i v a t e h a v i n g a f u l l b a n k 19 and in the e a r l y days of that the b a n k was 20 a n d Mr. 21 p r o - t e m b a s i s u n t i l L o n d o n c o u l d s t a f f it p r o p e r l y . 22 I t h i n k t h e r e m a y h a v e b e e n a time, 23 o n this, w h e r e t h e p o o l a c c o u n t w a s i n t h e n a m e of 24 Guinness & M a h o n G u e r n s e y for a period. 25 My information, 26 w a s t h a t at t h e t i m e w h e n t h e c h a n g e t o o k p l a c e t h a t 27 I w a n t to deal w i t h n o w a n d the m o n e y 28 w a s . . . (INTERJECTION). 29 '80's L o n d o n d e c i d e d t o se t u p a f u l l set u p L i p s c o m b e w a s it s f i r s t c h i e f e x e c u t i v e o n a I am just vague I m a y h a v e t a k e n it u p i n c o r r e c t l y , 1 No, 2 system, 3 a c c o u n t in D u b l i n h a d an a d d i t i o n a l a c c o u n t w i t h 4 College Trustees 5 that was on dep os it 6 think, 7 A 8 71 Q 9 after the bureau when the College Trustees when the Guinness & Mahon Cayman Trust and that change occurred, from the Channel in the G u i n n e s s the m o n e y I s l a n d s was, I & Mahon Guernsey? I t h i n k t h a t m a y w e l l be. I w a n t you to tell me a b o u t the c h a n g e o v e r that I have just m e n t i o n e d ? 10 A 11 72 Q 12 A This to G M C T Re College. Yes . I h a v e n o a b s o l u t e r e c o l l e c t i o n of it b u t I t h i n k it 13 w o u l d j u s t p u r e l y b e an a d m i n i s t r a t i v e 14 p e n t h i n g o n Mr. 15 funds b e i n g r o u t e d t hro u g h G u e r n s e y t h e y w o u l d just 16 b e p l a c e d i n t h e name, 17 s tuff w i t h i n the Group. 18 73 Q 19 Traynor's part. stroke of a I n s t e a d of t h e it is a l l j u s t i n t e r c o m p a n y T h a t m a y b e v e r y f a m i l i a r to you, but I w o u l d like y o u t o e x p l a i n it to m e in d e t a i l ? 20 A 21 74 Q 22 A 23 75 Q 24 A The change? Yes . I just recall the change taking place. Just tell me what the change was? The c hange w o u l d have b e e n that the pool deposits, 25 w h i c h w e r e i n D u b l i n in t h e n a m e of t h e G u i n n e s s 26 M a h o n G u e r n s e y w e r e now, 27 re p resented a deposit with the under l y i n g companies 28 out in the Cha nn el 29 G u e r n s e y p l a c i n g t h o s e f u n d s b a c k i n D u b l i n in a & which would have Islands with Guernsey, with 1 pool account, 2 f l o w of the funds w o u l d be that t h e y w e r e no l o n g e r 3 i n G u e r n s e y b u t t h e y w e r e b o o k e d as g o i n g b a c k to 4 C a y m a n and then from Ca y m a n b a c k to Dublin. 5 76 Q I n t h e b o o k s o f t h e c o m p a n y t h e f u n d s w e r e m o v e d to C a y m a n a n d f r o m C a y m a n to D u b l i n ? 6 7 that that w o u l d have c h a n g e d and the A Yes, it w o u l d b e a d e p o s i t b y t h e u n d e r l y i n g C h a n n e l 8 Islands companies, 9 have a deposit which p r e v i o u s l y was with Guernsey, 10 is n o w w i t h C a y m a n a n d C a y m a n is n o w p u t t i n g t h o s e 11 d e p o s i t s b a c k on b l o c k w i t h D u b l i n in the b u r e a u 12 system, 13 77 Q 14 the client type c o m pa ni es w o u l d whereas Guernsey had done that heretofore. It w a s i n t h e G u e r n s e y B u r e a u s y s t e m i n D u b l i n heretofore? 15 A 16 78 Q I t h i n k so. It w a s t h e n c h a n g e d so it w a s t r a n s f e r r e d i n t h e 17 b o o k s to C a y m a n an d t h e n got into the C a y m a n b u r e a u 18 system? 19 A 20 79 Q Yes . C a n y o u a s s i s t in r e l a t i o n to t h e c o d e s , from what 21 y o u h a v e s a i d it w o u l d s e e m to m e t h a t p r o b a b l y t h e 22 c o d e s w e r e e x a c t l y t h e s a m e in t h e n e w s y s t e m ? 23 A 24 80 Q I suspect, So, I c o u l d n ' t b e sure. f o r w h a t e v e r r e a s o n it w a s Mr. Traynor's 25 d e c i s i o n t h i s o c c u r r e d a n d it m e a n t t h a t t h e 26 G u e r n s e y a c c o u n t w a s c l o s e d in G u i n n e s s 27 there were instead two large accounts? 28 I t h i n k t h a t is c o r r e c t . 29 t h i n k C a y m a n w a s v e r y m u c h u n d e r Mr. & Mahon and I j u s t v o l u n t e e r this, Traynor's I 1 control, Guernsey would have been under London's 2 control, it w a s a L o n d o n s u b s i d i a r y , 3 b e e n m o r e p r o f i t a b l e f r o m t h e D u b l i n e n d f o r it to 4 b e c o m i n g b a c k to D u b l i n v i a C a y m a n , 5 subsidiary, 6 Guernsey, 7 81 Q 8 A 9 82 Q 10 a n d it m a y h a v e w h i c h w a s its r a t h e r than c om in g b a c k to Du bli n via which was London's subsidiary. It w a s a c o m m e r c i a l ? I t h i n k so, This yes. sy s t e m o p e r a t e d and what was your in vo lv e m e n t i n t h e s y s t e m u p to -- t h a t o c c u r r e d i n 1 9 8 1 ? 11 A 12 83 Q 13 A Yes . U p t o t h e t i m e y o u l e f t in 1 9 8 8 ? My involvement was fairly m i n i m a l in that period. 14 As 15 of t h e c l i e n t s , 16 m e i f t h e y w a n t e d to m a k e c o m m u n i c a t i o n , 17 r e l a t i v e l y s m a l l n u m b e r o f them, 18 a n a w a r e n e s s o f w h o t h e y w e r e t h e y w o u l d c o n t i n u e to 19 c o n t a c t me. 20 84 Q 21 22 I say, I had b ec om e a ware of the i d e n t i t y of some s o m e of t h o s e c l i e n t s w o u l d c o n t a c t a but because I had S o m e of t h e m h a d b a c k - t o - b a c k l o a n s . W e r e y o u i n v o l v e d in t h e b a c k - t o - b a c k l o a n situation? A O n l y to the e x t e n t that I was on the credit 23 c o m m i t t e e o f t h e bank, 24 I think about 25 believe, 26 some consid e r a b l e period. 27 if s o m e o f t h e s e p e o p l e w h o h a d e s t a b l i s h e d t r u s t s 28 are c o m pa nie s 29 funds, 1977. from the late '70's, T h e b a c k - t o - b a c k lo a n s , h a d b e e n g o i n g o n for, probably I p r e dated that by M y r e c o l l e c t i o n is t h a t o f f- sh or e and th e y w i s h e d to b o r r o w t h e p r o c e d u r e w o u l d b e t h a t it w o u l d go to 1 Mr. 2 b a c k - t o - b a c k w o u l d b e g r a n t e d a n d it w o u l d go 3 t h r o u g h in the n o r m a l w a y f r o m a c r e d i t c o m m i t t e e 4 decision. 5 n o t b e m e n t i o n e d in t h e s e c u r i t y l e t t e r . 6 35 Q. 7 A. Traynor, Mr. Traynor would decide whether a The e x i st en ce of the c ash de po s i t w o u l d I think the phrase used was I think various phrases 8 an absolute, 9 q uite l oose I think. 10 S6 Q. " s u i t a b l y s e c u r e d "? -- I h a v e n o r e c o l l e c t i o n of t h a t t h i s is a b s o l u t e , the phr a s e was If o n e c o m e s a c r o s s o n t h e d o c u m e n t as "adequately 11 secured" or "s u i t a b l y secured" that m e a n t a 12 b a c k - t o - b a c k loan? 13 A. 14 15 Almost certainly. I b e l i e v e it is p o s s i b l e t h e r e were exceptions. ]1 Q. T h e y w e r e n o t m e n t i o n e d at all. The fact that there 16 were b a c k - t o - b a c k loans took place was not me n t i o n e d 17 in the f a c i l i t y l e t t e r s ? 18 A. No, I t h i n k t h e r e is an is s u e , it w a s n ' t m e n t i o n e d 19 and the hypothecation, 20 h y p o t h e c a t e d to either, 21 C o l l e g e b y the u n d e r l y i n g d e p o s i t o r a n d I think, 22 facto, 23 those funds were there. 24 t h e y c o u l d a c t u a l l y l a y t h e i r h a n d s o n them, 25 f r o m a g r o u p p o i n t of v i e w . 26 p o i n t w i t h Mr. 27 ]Q Q. 28 A. 29 the funds w o u l d have been I presume, C a y m a n or to de Du bl in h a d the b e n e f i t of the k n o wle dg e that I a m n o t s u r e if l e g a l l y but I r e m e m b e r r ai s i n g the Traynor. At the credit committee this w ould have been raised? Yes. 1 2 90 Q 3 A A n d w e w o u l d j u s t go to t h e B o a r d t h e n f o r f o r m a l 4 a p p r o v a l i n t h e B o a r d m i n u t e s a n d it w o u l d go to 5 London. 6 ha d a keen inte re st in kno wi ng w h i c h loans were 7 c a s h e d back, 8 91 Q 9 A 10 11 I think London r e quired returns. London effectively. London would be informed? Th ey would, I believe, not b y me but in the n ormal banking.. . (INTERJECTION). 92 Q Yes. C o u l d I r e t u r n in t i m e to t h e C a y m a n I s l a n d ' s 12 subsidiary, 13 s h o r t t i m e b e f o r e y o u c a m e to t h e b a n k I t h i n k . 14 What was your involvement 15 A V e r y little, Mr. Ke a n e , it h a d b e e n e s t a b l i s h e d a I h a v e known, in t h e C a y m a n I s l a n d ? ve r y little. From time 16 to time I knew who the p e o p l e were d o w n there, 17 m e t Mr. 18 to t i m e o n e - o f f t h i n g s m i g h t 19 Mr. 20 t h e y w a n t e d t o o p e n a n a c c o u n t or s o m e t h i n g in 21 Dublin, 22 involvement really. 23 93 Q 24 A 26 94 Q 27 29 I h a d m e t Mr. Traynor might, b u t no, Furze and from time come up where they m i g h t be on the p ho ne and it w a s v e r y s p a s m o d i c a n d I h a d no Y o u k n e w some of the c l i e n t s of the C h a n n e l Islands Group? 25 28 Collins, I had Yes . D i d y o u k n o w s o m e o f t h e c l i e n t s i n t h e t r u s t s in the Cayman Islands? A W h e n I say no I w o u l d sa y I h a d a c e r t a i n a w a r e n e s s from the credit committee from the b a c k - t o - b a c k 1 loans that there were some ve r y large b a c k - t o - b a c k 2 loans w hich were suitably secured. 3 95 Q. 4 A. 5 96 Q. It w a s t h a t w a y y o u go t to k n o w t h e p e o p l e ? T h a t is h o w I g o t to k n o w them. W h y I a m a s k i n g y o u a b o u t t h e C a y m a n I s l a n d is t h a t 6 we have o b t a i n e d a docu me nt w h i c h was an in ternal 7 company document, 8 n o t f o r c i r c u l a t i o n to c l i e n t s , 9 Peat Group, 10 obviously September, C a y m a n Islands, 1974, it is it is t h e G u i n n e s s Exhibit 1, a n d it is r e f e r r e d t o at t h e f i r s t p a g e that: 11 "... a n y r e q u e s t f o r i n f o r m a t i o n or i n t r o d u c t i o n to t h e r e s i d e n t p e r s o n n e l s h o u l d b e r e f e r r e d to J. D e s m o n d T r a y n o r o r M a r t i n C. K e a n e . . . ." 12 13 14 W h a t e v e r t h a t w a s it w a s n o t o p e r a t e d , 15 situation? 16 A. 17 18 T h a t is m y u n d e r s t a n d i n g . ever seen this document, 97 Q. is t h a t t h e I don't believe Exhibit I have 1. I w o u l d like to get y o u r a s s i s t a n c e on a n o t h e r 19 a s p e c t of the s e r v i c e s that w e r e g i v e n b y Cayman. 20 We have been dealing with trusts with depositors who 21 were who w ere b e n e f i c i a r i e s of trusts, 22 w e r e a g r e a t n u m b e r of o t h e r p e o p l e w h o w e r e o n t h e 23 b u r e a u s y s t e m w h o h a d n ' t t r u s t s at a l l w h o m a d e 24 d e p o s i t s t h r o u g h Dublin, 25 A. but there can you explain that? I a m n o t r e a l l y f a m i l i a r w i t h that, Judge. As fa r 26 as I w a s a w a r e t h e v a s t b u l k o f t h e c u s t o m e r s o f t h e 27 Channel 28 there m a y not have b e e n t r u s t s over t h e m in all 29 cases. Islands companies had under l y i n g companies, I d on't b e l i e v e that t here were, certainly 1 not to m y r e c o l l e c t i o n , 2 opening accounts 3 tha t , 4 not a c o m p a n y a nd a trust or m a y b e there was a 5 c o m p a n y i n i t i a l l y a n d at s o m e p o i n t l a t e r a t r u s t 6 m a y h a v e b e e n p u t o v e r it. 7 98 Q any significant people in t h e i r o w n n a m e or a n y t h i n g l i k e that there was always a company, as le a s t , W e r e y o u a w a r e o f a n y i n d i v i d u a l s w h o w e r e on t h e 8 b u r e a u s y s t e m s w h o h a d n e v e r se t u p t r u s t s , 9 never companies 10 Cayman Islands? 11 A if in t h e C h a n n e l who were I s l a n d s or i n t h e N o t s p e c i f i c a l l y t h a t I c a n t h i n k of. This came up 12 l a s t w e e k i n t h e c o n t e x t o f t h e M o r i a r t y T r i b u n a l in 13 c onne c t i o n with Denis Foley and I gave evidence that 14 r e g a r d w h e r e Mr. 15 Fo le y and i n f o r m e d me that he was m i n d i n g funds 16 Deputy Foley and didn't tell me where they were and 17 t h e y c o u l d h a v e b e e n in e i t h e r b u r e a u s y s t e m . 18 99 Q trusts 20 bureau system? A 22 1 00 Q 23 A in a n y c o u n t r y b u t w h o w e r e o p e r a t i n g o n t h e I j u s t c a n ' t t h i n k of any. You didn't come across any? I h a v e n o m e m o r y at t h i s p o i n t . 24 the '7 0 's ? 25 MR. JUSTICE COSTELLO: 26 Is t h i s t a k e n f r o m Perhaps we m i g h t have a s h o r t b r e a k f o r a c u p of 27 c o f f e e now, 28 Yes . 29 fo r We have had several witnesses who never had any 19 21 Tr ay n o r i n t r o d u c e d me to De pu ty w o u l d that be all right? 1 2 3 4 1 01 Q. MR. JUSTICE COSTELLO: Mr. 5 Ke a n e , t here are only a few more questions that 6 I w a n t t o a s k you. 7 letter, 8 it w a s a d d r e s s e d to y o u a n d it w a s a R o y a l T r u s t 9 C o m p a n y o f C a n a d a Ltd. 10 I w a n t to a s k y o u a b o u t a it is a l e t t e r o f 2 0 t h May, 1988, Exhibit 1, It was: " D e a r Mr. Keen, L a r o o I n v e s t m e n t s Ltd. A n c u s a H o l d i n g s Ltd. a n d T y n e v i l l a I n v e s t m e n t s C.I. Ltd. 11 12 I h a v e p l e a s u r e in e n c l o s i n g c e r t i f i e d copies of the m e m o r a n d u m and articles of a s s o c i a t i o n t o g e t h e r w i t h c e r t i f i c a t e s o f i n c o r p o r a t i o n of t h e a b o v e n a m e d c o m p a n i e s . .." 13 14 15 16 17 What were these companies? A. I t h i n k t h e r e w a s s o m e t a x s c h e m e i n t h i s t o do w i t h 18 Michael Smurfit which I think Guinness 19 o ver from R oyal Trust. 20 avoidance scheme which involved various companies 21 i n t o b o r r o w i n g a n d a c e r t i f i c a t e of d e p o s i t . 22 think those companies would have opened accounts 23 with Guinness 24 a s k i n g t h e m for copies of the m e m o r a n d u m and 25 a r t i c l e s o f a s s o c i a t i o n in a c c o r d a n c e w i t h 26 normal...(INTERJECTION). 27 28 29 102 Q. & Mahon took It i n v o l v e d s o m e t a x I & Mahon and I think I would have been When you say they were opening accounts, Guinness & 1 A. 2 I think they ma y have well been with the Dublin company. 3 1 03 Q. O r w e r e t h e y i n v o l v e d at a l l w i t h A n s b a c h e r ? 4 A. I t h i n k it is o u t s i d e o f t h e A n s b a c h e r loo p . My 5 m e m o r y is t h a t t h e r e w a s loan, 6 o r i g i n a l l y a t h r e e y e a r c e r t i f i c a t e of l o a n a n d 7 c e r t i f i c a t e o f d e p o s i t m a t u r i n g at t h e e n d of t h r e e 8 years, 9 some p o i n t in the I t h i n k it w a s w h i c h w a s o r i g i n a l l y w i t h R o y a l Tr u s t , a n d at '70's I t h i n k R o y a l T r u s t 10 i n d i c a t e d that th e y didn't want to c o n t in ue the 11 business. 12 who was 13 would take over the business. 14 Guinness 15 m i n u t e to s u p p o r t t h is. 16 M a h o n l e n d i n g Mr. 17 money, 18 Tynevilla, 19 out a c e r t i f i c a t e of dep os it w it h the b a n k whi ch 20 w o u l d m a t u r e i n t h r e e y e a r s tim e . 21 companies were involved. 22 h a p p e n e d w i t h t h e c e r t i f i c a t e o f d e p o s i t -- I 23 b e lieve that Royal Trust had this business which 24 i n v o l v e d a l o a n to Mr. 25 Tynevilla, 26 loan and a ce r t i f i c a t e of deposit, 27 a n d a c e r t i f i c a t e o f d e p o s i t w h i c h w o u l d m a t u r e at 28 the end of three years. It was, 29 of t a x a v o i d a n c e w h i c h was o r i g i n a l l y Guinness & Mahon, f r i e n d l y w i t h Mr. & Mahon, t h r o u g h Mr. Smurfit, Traynor, i n d i c a t e d t h a t we I t h i n k it i n v o l v e d but I t h i n k there will be a credit It i n v o l v e d G u i n n e s s & S m u r f i t a s u b s t a n t i a l a m o u n t of I t h i n k it w a s l i k e a m i l l i o n p o u n d s a n d I think, but is o n e o f t h e c o m p a n i e s t a k i n g These other At the end various things Smurfit and a deposit by I c a n ' t b e sure, scheme, b u t it i n v o l v e d a a three year loan I think, some form 1 a d m i n i s t e r e d by Royal Trust. 2 i n d i c a t e d t h e y d i d n ' t w i s h to c o n t i n u e w i t h it, 3 think they were winding down their operations 4 Ireland and Guinness 5 in, 6 '80's, 7 of d e p o s i t 8 w o u l d n ' t h a v e c l a s s i f i e d it as p a r t of t h e A n s b a c h e r 9 deposits, I think Royal Trust I in & M a h o n t o o k it o v e r s o m e t i m e t h e d a t e is s l i g h t l y s t r a i n e d , it r o l l e d e v e r y t h r e e y e a r s , s o m e t i m e in t h e this certificate s c h e m e a n d b o r r o w i n g r o l l e d ove r . I it w o u l d h a v e b e e n a c e r t i f i c a t e of 10 d e p o s i t of the b a n k in Dublin, 11 these companies were a ssociated with the transaction 12 in some w a y a n d I w o u l d t h i n k that t h e y w o u l d have 13 b e e n s e n d i n g m e t h e m e m o r a n d u m a n d a r t i c l e of 14 a s s o c i a t i o n in a c c o r d a n c e w i t h n o r m a l a c c o u n t 15 opening. 16 104 Q 17 18 Tynevilla Smurfitt's A Investments company, I suspect. I t h i n k is J e f f e r s o n is it? I d o n ' t k n o w b u t m y u n d e r s t a n d i n g is it is 19 a s s o c i a t e d w i t h Mr. 20 a c c e s s to t h e c r e d i t m e m o r a n d a of t h e b a n k . 21 1 05 Q 22 A I think W h e n you say the Smurfit. I t h i n k if y o u h a v e " c r e d i t m e m o r a n d a " w h a t is t h a t ? T h e c r e d i t m i n u t e s of t h e b a n k or t h e b o a r d m i n u t e s 23 of the b a n k w h i c h w o u l d r e c o r d the l o a n decisions. 24 I t h i n k y o u w o u l d p r o b a b l y f i n d a loan, 25 is t o M i c h a e l 26 this t r a n s a c t i o n w o u l d be q uite clear. 27 t h e A n s b a c h e r a c c o u n t s as such. 28 106 Q 29 A Smurfitt personally, I t h i n k it a n d t h e n a t u r e of T h e s e w o u l d b e in t h e b a n k ' s m i n u t e s ? It is n o t in 1 107 Q 2 A T h e c r e d i t m i n u t e s w o u l d be, t h e r e is t h e c r e d i t 3 committee minutes and then they would subsequently 4 go f o r a p p r o v a l to t h e B o a r d so t h e y w o u l d be 5 r e p e a t e d a g a i n in t h e B o a r d m i n u t e s . 6 108 Q 7 8 originally have the decision? A 9 T h a t ' s right, Board. 10 11 It w o u l d b e t h e c r e d i t c o m m i t t e e m i n u t e s t h a t w o u l d w h i c h w o u l d t hen be r e a p p r o v e d b y the E s p e c i a l l y of t h e m a g n i t u d e I t h i n k it w o u l d p r o b a b l y h a v e h a d to go to L o n d o n . 109 Q MS. MACKEY: So r r y , 12 Mr. Keane, that w o u l d be in the late 13 early 14 A 15 1 10 Q '70's '8 0 ' s ? T h e d a t e -- it w e n t o n o v e r a l o n g p e r i o d of tim e . MS. MACKEY: But the in it ial credit 16 committee minute, w o u l d it 17 b e at t h e b e g i n n i n g ? 18 There would be a new credit committee minute each 19 ti me, 20 It i n t h e o r i g i n a l 21 January, 22 23 " . . . G u i n n e s s & M a h o n Ltd. o f w h i c h y o u w e r e a d i r e c t o r . .." I was n e v e r a d i r e c t o r of the bank. 24 MR. 25 each three year cycle. just letter, Just before your le tt er to me of 28th for the record, JUSTICE COSTELLO: I forget. Yes. it says: Mr. Keane, you a p p r e c i a t e t h a t it is an 26 i m p o r t a n t p a r t of o u r f u n c t i o n to a s c e r t a i n t h e 27 per s o n s who w ere clients of A n s b a c h e r and I 28 appreciate that you m ay not 29 feel p a r t i c u l a r l y h a p p y 1 i n f o r m us o f t h e n a m e s . 2 y o u w o u l d l i k e to do, 3 t h a t y o u c o u l d g i v e us t h e n a m e s , 4 s e n d t h e m o n t o us later. 5 MR. I would suggest whatever but what SHUBOTHAM: I w o u l d s u g g e s t is write t h e m out and C o u l d I i n t e r r u p t j u s t at 6 this point, I hope this 7 w o u l d be of a s s i s t a n c e . 8 e v i d e n c e t h a t h a s c o m e o u t to d a t e is Mr. 9 knows, C l e a r l y I t h i n k the Keane has a fair bit of i n f o r m a t i o n about the 10 Channel 11 i n f o r m a t i o n i n r e l a t i o n to t h e C a y m a n s . 12 o f it, 13 Islands, 14 c o n n e c t e d wi t h the affairs of the c o m p a n y over 15 w h i c h - do you m i n d a l l o w i n g m e this - are not 16 c o n n e c t e d w it h the a ffairs of the c o m p a n y over wh ic h 17 you are appointed. 18 t h a t y o u m a y b e in p o s s e s s i o n o f i n f o r m a t i o n of 19 w h i c h you are aware, 20 a f f a i r s o f t h e c o m p a n y a n d t h e r e f o r e p a r t of y o u r 21 enquiries, 22 a s k i n g for this information; 23 with the affairs 24 a p p o i n t e d Mr. 25 with t h a t . 26 MR. Islands, he h a s a v e r y l i m i t e d a m o u n t of On the face the information concerning the Channel as f a r as Mr. K e a n e is c o n c e r n e d , However, Mr. is n o t Keane recognises w h i c h d o e s m a k e it p a r t o f t h e a n d if it is o n t h a t b a s i s t h a t y o u a r e i.e. it is c o n n e c t e d of t h e c o m p a n y o v e r w h i c h y o u a r e K eane has no d i f f i c u l t y in c om p l y i n g JUSTICE COSTELLO: 27 I c a n n o t d i v u l g e to y o u the b asis on w h i c h we are 28 p ut t i n g our question. 29 Mr. Keane, It s e e m s t o m e t o b e clear, from the e v i de nce that we have that 1 p e o p l e w h o e s t a b l i s h e d t r u s t s in G u e r n s e y a n d w h o 2 n e v e r f i n i s h e d u p t h e i r t r u s t s or w h a t e v e r it was, 3 or l e f t t h e m l y i n g d o r m a n t b e f o r e 4 c o n c e r n o f our s , 5 p e o p l e w h o h a v e m a i n t a i n e d t r u s t s i n G u e r n s e y are. 6 W h a t w e w o u l d r e q u i r e f r o m y o u is t h e n a m e s of 7 ev e r y b o d y who est a b l i s h e d trusts, 8 Gue r n s e y and the subsidiaries. 9 t h e m a n d a s k them, 1981, a r e o f no it s e e m s to us t h a t a f t e r 1981 w h o h a d t r u s t s in W e w i l l w r i t e to if t h e y h a d n o d e a l i n g s 10 1 9 8 1 w e a r e n o t c o n c e r n e d w i t h them, 11 are. 12 m a i n t a i n i n g this position, 13 the questions. 14 MR. T h a t is t h e p o s i t i o n . after if t h e y h a d we M a y I just say we are t h i s is w h y w e a r e a s k i n g W o u l d you like time to cons ide r? SHUBOTHAM: 15 On that basis, it is c l e a r from the Act and I am not 16 g o i n g t o q u o t e t h e l a w to you, 17 m e a n it is c l e a r f r o m t h e A c t t h a t it m u s t be 18 c o n n e c t e d w i t h t h e a f f a i r s a n d if y o u a r e a s s u r i n g 19 us t h a t t h i s is c o n n e c t e d w i t h t h e a f f a i r s of t h e 20 c o m p a n y t h a t y o u a r e i n v e s t i g a t i n g w e h a v e no 21 p r o b l e m in p r o v i d i n g the i n f o r m a t i o n . 22 MR. JUSTICE COSTELLO: 23 with respect, T h a n k you. a d v i c e is, but I Our legal yes, t h a t we 24 w ill op er at e the w a y I h ave i n d i c a t e d and we are 25 r e q u i r e d t o d o so u n d e r t h e t e r m s of t h e or d e r . 26 V e r y wel l , that has c l a r i f i e d the situation. 27 28 29 (TO W I T N E S S ) I w i l l d o w h a t e v e r y o u w o u l d like, m i g h t like to consider, you I am sure you have given a 1 l o t o f t h o u g h t to t h i s a l r e a d y , 2 l i s t o f n a m e s o f c l i e n t s b o t h in t h e C h a n n e l 3 a n d i n C a y m a n a n d I u n d e r s t a n d y o u r e v i d e n c e is t h a t 4 you knew ve r y little about the Cayman. 5 Yes . 6 1 11 Q a n d f o r w a r d to us a In a d d i t i o n we w i l l r e q u i r e yo u to i n d i c a t e Islands from 7 y o u r k n o w l e d g e on t h e c r e d i t c o m m i t t e e t h e p e r s o n s 8 who had back- t o - b a c k loans because they had 9 b a c k - t o - b a c k loans which were b a c k e d by the Cayman 10 c o m p a n y so w e w i l l r e q u i r e b o t h , 11 i n d i c a t e o n t h e d o c u m e n t t h a t y o u w o u l d s e n d to us 12 who, 13 knowledge, 14 transaction? 15 A 16 to y o u r knowledge, a n d if y o u c o u l d h a d trusts, a n d who, to y o u r w e r e i n v o l v e d in t h e b a c k - t o - b a c k l o a n Certainly MR. SHUBOTHAM: 17 Mr. K e a n e is a b s o l u t e l y h a p p y t o d o t h a t on t h a t 18 basis, but 19 clear, o b v i o u s l y h e h a s n o d o c u m e n t a t i o n so a n y l i s t 20 h e p r e p a r e s w i l l b e p u r e l y as a r e s u l t of h i s 21 r e c o l l e c t i o n a n d h i s r e c o l l e c t i o n o n l y a n d n o n e of 22 us h a v e p e r f e c t r e c o l l e c t i o n . 23 112 Q MR. f o r t h e r e c o r d I j u s t w a n t t o m a k e it JUSTICE COSTELLO: 24 V e r y well. T h e r e is o n e l a s t m a t t e r t h a t I w a n t to 25 a s k y o u a b o u t a n d t h a t is w h e t h e r you, 26 a deposit 27 A 28 1 13 Q 29 A No. a n d w e r e i n v o l v e d in t h i s ? yourself, had 1 114 Q. We have records in r e l a t i o n to t h e l e d g e r a c c o u n t 2 w h i c h shows that p a y m e n t s out were m ad e to you but 3 t h e y w e r e v e r y s m a l l sums, 4 y o u like, 5 b a d but the y are p a y m e n t s out from the ledger, 6 the Guinness 7 t h e y a r e h i g h l i g h t e d t h e r e 1 9 8 2 t h e r e is £ 2 0 0 in 8 F e b r u a r y 1982 and t h e n o v e r the p a g e in M a r c h t h ere 9 is £ 3 0 0 a n d o v e r t h e p a g e t h e n . . . ( I N T E R J E C T I O N ) . 10 A. from the deposit. 12 travelling expenses. all the questions. 15 a few questions. 17 18 19 20 21 22 23 24 25 26 27 28 29 Islands a nd t h e y are just I just want your evi de nc e on this point. 14 16 it is M y b e s t b e l i e f o n t h o s e is t h a t I t r a v e l l e d on o c c a s i o n to the C h a n n e l 1 15 Q. T h e p h o t o s t a t is v e r y & M a h o n C o l l e g e l e d g e r a n d you will see 11 13 w e c a n s h o w it t o y o u if Mr. T h a t is R owan w o u l d like to ask you 1 2 3 1 1 6 Q. MR. ROWAN: Mr. 4 say? 6 A. 7 117 Q. 8 Yes. A n d that you trained with Stokes Ken n e d y and Crowley? 9 A. 10 118 Q. 11 T h a t ' s right, yes. A n d that d i rectly you q u a l ified you left Stokes Kennedy Crowley and joined Guinness 12 A. 13 1 1 9 Q. That's During your training contract and while you were w i t h SKC, 15 particular specialist 16 A. 17 1 20 Q. 18 & Mahon? correct. 14 did you have any o p p o r t u n i t y to gain any Not particularly, k n o w l e d g e of t a x m a t t e r s ? no. S o it w a s a c o n v e n t i o n a l t r a i n i n g c o n t r a c t of t h e day? A. Conventional training contract and I actually moved 20 into corporate 21 t r aining contract. 22 you are a chartered accountant you 5 19 Ke a n e , 1 21 Q. Corporate finance b e f o r e the e x p i r a t i o n of m y f i n a n c e is a v e r y w i d e e m b r a c i n g n a m e a n d 23 I just wo n d e r e d whether you might describe 24 what a spects of c o rp ora te 25 wh e n you w ere wi t h SKC first and th e n s u b s e q u e n t l y 26 during your time with Guinness 27 A. finance work that you did & Mahon? I w a s v e r y j u n i o r w h e n I w a s in SKC, 28 Mr. A l e x S p a i n . 29 corporate f o r us I w o r k e d fo r I t h i n k w h a t w e w o u l d d e f i n e as f i n a n c e in m y S K C t i m e t e n d e d t o be 1 s p e c i a l work, 2 w h a t I w o u l d p r o b a b l y d e s c r i b e as c o r p o r a t e 3 i n m y c u r r e n t o r in m y G u i n n e s s 4 s e n s e it w o u l d b e l a r g e l y f u n d r a i s i n g fo r 5 companies. 6 122 Q 7 A one-off type assignments rather than finance & M a h o n days, in t h e T h i s is w i t h ? W i t h SKC. Some a c q u i s i t i o n a c t i v i t y a nd I was 8 p r e t t y junior and that w o u l d have b e e n in a p e r i o d 9 just round before I qualified. B u t it w o u l d b e 10 s p e c i a l work, 11 w o u l d h a v e b e e n l o o s e l y d e f i n e d as c o r p o r a t e 12 i n SKC. 13 w a s . . . (INTERJECTION). 14 1 23 Q 15 for banks, A 17 124 Q 18 When I joined the ba n k corporate finance finance So t h a t w h e n y o u w e r e w i t h S K C y o u e i t h e r h a d n ' t Yes . Do I a s s u m e t h a t s o m e o f t h e w o r k w o u l d h a v e b e e n of an i n v e s t i g a t o r y natu r e ? A I a m j u s t t r y i n g to th i n k , 20 a ffairs of companies, 21 m a y b e in some difficulty, 22 k i n d of stuff, 23 those. 24 t h a t k i n d of t h i n g q u a l i f i e d or you just h a d q u alified? 16 19 reports 1 25 Q re ports on the f inancial y e s to t h a t e x t e n t . reports Companies f o r t h e b a nk, that I c a n r e m e m b e r d o i n g o n e or t w o of It is a l o n g t i m e ago, Mr. Rowan. W h a t p r o m p t e d y o u to l e a v e S K C so q u i c k l y , 25 an u n c o m m o n feature, 26 i n . ..(INTERJECTION). 27 I h a v e n o p r o b l e m a n s w e r i n g it. 28 as q u a l i f y i n g i n 1972, 29 I am a c t u a l l y on the register. but it is n o t I am i n t e r e s t e d just I think I am down in f a c t t h a t is t h e y e a r t h a t I think I actually 1 q u a l i f i e d i n t h e w i n t e r e x a m s in 1971, 2 have bee n the e nd of m y t r a i n i n g c o n t ra ct and I left 3 about seven months 4 b e e n w o r k i n g on some flota ti on s 5 reports 6 demised. 7 is p e r c e i v e d t o b e an a t t r a c t i v e c o u r s e a c t i o n fo r 8 a s p i r i n g y o u n g a c c o u n t a n t s to g e t i n t o c o r p o r a t e 9 finance wi t h a m e r c h a n t bank. la t e r . which would U p to t h a t t i m e I h a d for long form f o r t h e J o n e s G r o u p at t h a t time, At that time the attractive, now a n d it s t i l l M y t r i g g e r for m o v i n g 10 at t h a t t i m e w a s t h a t m y t h e n b o s s a n d m e n t o r , 11 Mr. 12 w h i c h i n t h e e n d o f t h e d a y h e d i d n ' t do, 13 d e c i d e d i f h e w a s go i n g , 14 that time Guinness 15 corporate 16 for G u i n n e s s 17 a n d I a p p l i e d f o r t h e j o b a n d I g o t it a n d I w a s 18 delighted with myself. 19 1 2 6 Q. 20 21 Spain, h a d i n d i c a t e d h e w a s l e a v i n g t h e firm, I w o u l d also, and around & M a h o n a d v e r t i s e d for j unior finance executives. I had done some work & M a h o n on a r e p o r t i n g a c c o u n t a n t ' s job S o t h e n d e s c r i b e w h a t c o r p o r a t e f i n a n c e e n t a i l e d as y o u d e v e l o p e d y o u r c a r e e r in G u i n n e s s A. and I Corporate f i n a n c e in G u i n n e s s & Mahon, & Mahon? Guinness & 22 M ahon was a small merchant ba n k with a fairly good 23 pedigree. 24 mergers 25 w o r k or p r e - f l o t a t i o n s work. 26 of stuff, 27 t h o s e p a r t i c u l a r y e a r s as to w h a t p a r t i c u l a r j o b s 28 w e r e g o i n g on in that p a r t i c u l a r p eriod. 29 were very lengthy. It i n v o l v e d t h e a d v i s i n g of c o m p a n i e s on and acquisitions. Mr. Rowan, It i n v o l v e d f l o t a t i o n s Really, all that kind I can't think back through Some jobs T h e w h o l e r e s t r u c t u r i n g fo r 1 G o l d e n Vale, 2 months with very long periods away from Dublin down 3 in G o l d e n Vale. 4 in the d e f e n c e of the n e w I r e l a n d G r o u p f r o m the b i d 5 b y PMPA, I w o u l d h a v e b e e n o n t h e t e a m o n that. 6 Numerous other smaller acquisitions 7 a d v i c e to o t h e r companies, 8 Crawford. 9 s e n i o r p e r s o n o n it, 10 127 Q w h i c h I w o r k e d o n fo r a b o u t s i x o r n i n e I would have been heavily involved I wouldn't, That was the point and financial Irish Ropes, obviously, but that Beamish & have b e e n the k i n d of a c t i v i t y . I w a s g o i n g to m a k e b e c a u s e 11 inevitably you were a relatively newly trained 12 chartered accountant when you joined Guinness 13 M a h o n a n d y o u h a d l i m i t e d p r a c t i c a l e x p e r i e n c e at 14 t h a t s t a g e a n d y o u w o u l d h a v e w o r k e d as a j u n i o r 15 m e m b e r o f t h e t e am. 16 force? Who w ould have been the driving 17 A On the corporate f i n a n c e s i d e in G u i n n e s s 18 128 Q On the corporate finance side? 19 A corporate 21 senior was a m a n cal le d Nigel Dewbury, 22 d i r e c t o r of the bank, 23 merchant bank corporate 129 Q 25 26 & Mahon? M a u r i c e O ' K e l l y I t h i n k w a s t h e m a i n p e r s o n on 20 24 & finance. I when I joined my nominal who was a who was a fully London trained finance person. W h e n d i d y o u s t a r t to h a v e s i g n i f i c a n t c o n t a c t w i t h Desmond Traynor? A I t h i n k m y -- I m e a n o b v i o u s l y it w a s a v e r y s m a l l 27 bank, 28 r e a l c o n t a c t w i t h Mr. 29 1 9 7 4 w h e n I w a s a s k e d to u n d e r t a k e t h i s w o r k in but I t hink I stated earlier that m y first T r a y n o r w o u l d h a v e c o m e in 1 2 1 30 Q 3 4 That wouldn't have been rea l l y corporate finance w o r k w o u l d it? A No, and I have stated that but I mean I think there 5 was a p r o b l e m and there was nobo d y around and 6 Mr. 7 I w a s a s k e d t o do it. 8 1 31 Q 9 10 T r a y n o r w a n t e d s o m e b o d y to c a r r y o u t a r o l e a n d W h e n you be c a m e i n v o l v e d wit h the Chan n e l Islands, h o w m u c h of y o u r time d i d that take up? A I n i t i a l l y it w a s n e v e r a g r e a t d e a l of time, 11 i n i t i a l l y in that period, 1 9 7 4 / 7 5 p e r i o d it m i g h t 12 have taken up ten percent , fi ft ee n p e r c e n t of m y 13 ti me, 14 132 Q I suspect. As yo u got to k n o w a bit m o r e a b o u t the C h a n n e l 15 I s l a n d s a n d t r u s t s a n d a l l o f that, 16 j u d g e w a s t h e t e c h n i c a l d r i v i n g f o r c e of a l l o f t h i s 17 inside Guinness 18 A 19 1 33 Q 20 A Mr. who did you & Mahon? Traynor. D i d he r e l y on an y e x t e r n a l a d v i s e r s ? H e m a y h a v e d o n e. I think Don Reid was the bank's 21 e x t e r n a l t a x a d v i s e r t h r o u g h a l l t h a t p e r i o d a n d he 22 was v e r y close. 23 p e r s o n t h a t w o u l d c o m e to m i n d . 24 134 Q 25 26 I t hi nk that w o u l d be the only Was t here a firm of legal adv is er s who m a y have had s o m e p a r t t o p l a y in t h i s ? A I d o n ' t know, I h a v e no r e c o l l e c t i o n at a l l o f a n y 27 legal advisers. 28 b u t not in this context, 29 the c ontext of the C hannel T h e b a n k h a d l o t s of l e g a l a d v i s e r s if y o u a r e t a l k i n g to m e in Islands. 1 1 35 Q. At this point I am, yes. So t h a t i n t h e '80's w h e n 2 the relationship with the Channel 3 d i m i n i s h a n d it b e c a m e m o r e C a y m a n o p e r a t i o n a n d 4 du r i n g the later stages of your e m p l o y m e n t with 5 Guinness 6 n u m b e r of firms of a c c o u n t a n t s a n d s o l i c i t o r s who 7 m a y have d ealt w i t h the bank, 8 clients, 9 l e g a l f i r m s w h o w o u l d s e e m to h a v e h a d a n i n t e r e s t Islands s t a r t e d to & M ahon you would have come across quite a a c t i n g o n b e h a l f of d o y o u r e c a l l n a m e s o f a c c o u n t i n g f i r m s or 10 in the area of t r u s t s a n d a d v i s i n g on t r u s t s an d 11 o f f - s h o r e a r r a n g e m e n t s o f o n e s o r t or a n o t h e r ? 12 A. I t h i n k I w i l l b r e a k t h i s in two. I t h i n k in t h e 13 ' 7 0's m y m e m o r y is t h e r e w a s q u i t e a l o t of t a x 14 avoidance 15 I s l a n d s a n d t h e b a n k m a y h a v e b e e n p a r t of s o m e of 16 those from p u r e l y the b a n k i n g t r a n s a c t i o n s 17 in t h o s e schemes. 18 c o n n e ct io ns wi t h some of the clients. 19 were other schemes which didn't n e cessarily give 20 r i s e t o o n g o i n g a c c o u n t s in t h e C h a n n e l 21 various other legal 22 some tax schemes, 23 counsel, 24 other legal 25 t a x p l a n n i n g on b e h a l f of t h e i r clients. 26 1 3 6 Q. 27 A. s c h e m e s b e i n g o p e r a t e d o u t of t h e C h a n n e l involved I think SKC w ould have had close I think there Islands with firms and I t hink there were from memory, which were devised by b y Ch ar le s H a c ic iu s and I t h i n k one or two f i r m s t h a t c o m e to m i n d w h o w e r e i n t o Their names? O n e t h a t c o m e s to m i n d is K e n n y S t e p h e n s o n & C h a p m a n 28 in Wat e r f o r d , 29 schemes. w h o had, I can remember some tax T he y are not ones that I b e l i e v e gave rise 1 to trusts, 2 don't have a ny o n g o i n g that there was an on go in g 3 client afterwards. 4 to SKC in that category. 5 137 Q 6 A 7 in that case t h e y are t r a n s i e n t , I c a n t h i n k of s o m e i n r e l a t i o n So t h a t as y o u w e n t i n t o t h e This w o u l d be '70's, now. ' 80' s ... ( I N T E R J E C T I O N ) . I am talking about ' 8 0's I r e c a l l v e r y l i t t l e a c t i v i t y i n t h e 8 138 Q 9 A 10 139 Q 11 A they '70's, '80's. Just explain what you m e a n by that? By which? That you recall ve r y little? M y m e m o r y o f it is t h a t t h e r e w a s a l o t of t a x 12 p l a n n i n g a n d a c t i v i t y in t h e C h a n n e l 13 ' 7 0's a n d t h a t t h a t is t h e p e r i o d i n w h i c h m o s t of 14 it t o o k p l a c e a n d t h a t is r e a l l y a l l I c a n say. 15 T h a t is p u r e l y f r o m r e c o l l e c t i o n . 16 t h i n k s t r i k e m e as, 17 quite w h a t e v e r was t here was there. 18 1 40 Q I s l a n d s in t h e The in m y perspective, I a m j u s t t r y i n g to f i n d w h e r e '80's, I relatively I n o t e d it. But I 19 t h i n k I got an i m p r e s s i o n w he re you said that there 20 w ere fu rth er clients who b e c a m e i n v o l v e d in the 21 ' 80 ' s? 22 A Maybe it w a s a m i s t a k e o n m y p a r t . I t h i n k it w a s 23 in the 24 few, 25 w a s a w a r e o f at a n y rate. 26 It w a s a c o n f u s i o n . 27 l i t t l e bit of t i m e r e v i e w i n g the f i n a n c i a l 28 statements 29 '70's, the m i d from m y memory, '70's, I think there were very new c lients in the '80's t h a t It m a y b e m y fault. You said that you spent a of G u i n n e s s & Mahon College Trust? I 1 142 Q 2 A That w ould p u r e l y have bee n a rev i e w with 3 Mr. 4 through what the management 5 his m a n a g e m e n t 6 p u t t i n g t h r o u g h for manag em en t. 7 1 43 Q 8 9 L i p s c o m b e w h e r e he w o u l d h a v e j u s t g o n e d o w n fe e w a s a n d t h e b a s i s of fe e a n d w h a t c h a r g e s t h e y w e r e In t e r m s of rev i e w i n g , w h a t s o r t of a h a t h a d y o u on when you were doing that? A I ' m n o t s u re. I t h i n k it w a s a n a d m i n i s t r a t i v e t y p e 10 of hat. 11 the Ch an nel 12 o n g o i n g s i t u a t i o n I w o u l d h a v e j u s t l o o k e d at t h e 13 accounts just to r e v i e w w h a t the t o t a l fees w e r e an d 14 t h a t Mr. Lipscombe's 15 t h e a g r e e m e n t was, 16 income, 17 144 Q 18 The accounts Islands. f o r C o l l e g e w e r e a u d i t e d in I t h i n k j u s t as p a r t of t h e fee w a s in a c c o r d a n c e w i t h w h a t t h a t it w a s fifty p e r c e n t of the w h i c h I t h i n k is w h a t t h e a g r e e m e n t was. You are acting, if y o u like, you were reviewing them w i t h y o u r D u b l i n h a t on? 19 A 20 1 45 Q I t h i n k t h a t is c o r r e c t , yes. This re v i e w w o u l d have b e e n c a r r i e d out bef o r e the 21 audit had bee n c o m p l e t e d or after the audit h a d b e en 22 completed? 23 A Proba b l y aro u n d the same time I suspect. 24 s a i d it, 25 on the audit really. 26 146 Q When I it w a s n ' t a b i g t h i n g we w o u l d h a v e r e l i e d You might have had more k n o w l e d g e of w h e t h e r t h i n g s 27 were c orrect or not m or e t han the audi to rs ? 28 I d o n ' t t h i n k so. 29 clear, It w a s n ' t a case, just to be o f g o i n g d o w n t h r o u g h t h e i n c o m e s i d e of 1 C o l l e g e T r u s t e e s to e s t a b l i s h t h a t t h a t w a s a l l t h e 2 i n come and m e c a r r y i n g out an a udit that in fact all 3 the income was p r o p e r l y included. 4 h a d o u r c o n s i d e r a b l e t r u s t a n d so it w o u l d b e f a i r l y 5 c u r s o r y t o a s k h i m to e x p l a i n t h e c a l c u l a t i o n o f h i s 6 f e e a n d h o w it r e c o n c i l e d b a c k to t h e i n c o m e in t h e 7 a c c o u n t a n d a n y e x p e n s e item. 8 147 Q. 9 Okay. John Lipscombe You m e n t i o n e d that you were a m e m b e r of the c r e d i t c o m m i t t e e of G u i n n e s s & Mahon, when did you 10 b e c o m e a m e m b e r of t h e c r e d i t c o m m i t t e e , 11 remember? 12 A. can you I t h i n k t h e r e w a s a m a j o r r e o r g a n i s a t i o n of G u i n n e s s 13 & M a h o n in or a bout 1977 u n d e r w h i c h the cre d i t 14 c o m m i t t e e w a s t h e n se t up. 15 c o m m i t t e e as s u c h p r i o r to t h a t d a t e a n d t h e c r e d i t 16 com m i t t e e was e x p a n d e d and that c o i n c i d e d w ith the 17 t i m e t h a t Mr. 18 non-executive, Mr. Traynor 19 b e c a m e e x e c u t i v e d e p u t y c h a i r m a n a n d Mr. O'Kelly 20 became managing director. 21 committee, 22 all of the b a n k i n g people, 23 managers 24 a n d it m e t t w i c e a wee k . 25 d e c i s i o n s w e r e r a t i f i e d b y t h e B o a r d at t h e 26 subsequent weekly Board meeting. 27 1977, 28 29 148 Q. You, There was no credit Guinness became chairman Mr. Forwood departed, They instituted a credit which was a large credit committee where a l l of t h e s e n i o r in the b a n k w e r e on the c r e d i t c o m m i t t e e maybe The minutes of its I t h i n k it w a s 1978. as o n e o f t h e m a n a g e r s , w o u l d h a v e sa t o n t h e 1 A. 2 I c o u l d w o r k o u t w h o w a s o n it, if y o u w a n t , p r o b a b l y it w o u l d b e t e n o r t w e l v e p e o p l e o n it. 3 1 4 9 Q. 4 A. It w o u l d h a v e b e e n c h a i r e d b y ? C h a i r e d b y w h o e v e r the sen io r d i r e c t o r was a v a i lab le 5 o n t h e day. It m i g h t b e Mr. Traynor, 6 Mr. it m i g h t b e Mr. Pender, 7 banking director. 8 but 1 50 Q. 9 O'Kelly, it m i g h t b e who was the T h i s i s s u e c a m e u p in t h e c o n t e x t of t h e back-to-back loan applications? 10 A. 11 1 51 Q. Yes. I wo n d e r e d w ould you try and describe the process 12 w here a loan a p p l i c a t i o n was b r o u g h t to the credit 13 committee. 14 like yo u to d e s c r i b e wh o m i g h t h a v e f o r m u l a t e d the 15 d o c u m e n t w h i c h c a m e to t h e c r e d i t c o m m i t t e e ? 16 A. What I w o u l d l i k e y o u t o d o is I w o u l d It c o u l d h a v e b e e n a n y o n e o f a n u m b e r of p e o p l e . 17 In a lot of c ases 18 people, 19 was on loans, 20 p repare a credit minute, 21 a pp l i c a t i o n form w hich was just a fairly standard 22 f o r m a n d I t h i n k in t h e c a s e o f a n y of t h e t h e m t h a t 23 w e r e g o i n g t o b e s u i t a b l y s e c u r e d or w e r e g o i n g to 24 b e m e t b y -- t h e y m i g h t h a v e b e e n i n s t r u c t e d b y 25 Mr. 26 process 27 really. 28 Mr. Traynor directly, 29 Mr. O ' D w y e r to p r e p a r e the m inute, I w o u l d s a y it w o u l d b e t h e l o a n s the loans people down stairs. Traynor. Mr. Pa t O ' D w y e r , Mr. Leonard very often they would kind of a credit It w a s n ' t a v e r y c l o s e l y d e f i n e d it c o u l d h a v e b e e n a l l o v e r t h e p l a c e , A lot of t h e m m i g h t h a v e come f r o m I suspect, m a y b e to he w o u l d h a v e 1 2 152 Q. 3 O b v i o u s l y s o m e o n e h a d to f i l l o u t t h e b o x e s o n t h e form? 4 A. 5 1 53 Q. That's correct, yes. I w o n d e r e d w h e t h e r you h a d any a p p r e c i a t i o n of the 6 actual process of d e c i d i n g w h y a l o a n w a s n e c e s s a r y . 7 I mean, 8 a c l i e n t w h o s a id: 9 m o n e y out of m y trust. for instance, the loan might have come from I w o u l d like to get some of m y That might have been dealt 10 wi t h , 11 c o r p o r a t e v e h i c l e if y o u like. 12 d i s c o v e r is w h e t h e r t h i s w a s a p r o c e s s w h i c h w a s 13 i n i t i a t e d b y a c l i e n t o r w h e t h e r it w a s i n i t i a t e d b y 14 one of the e x e c u t i v e s 15 p a r t i c u l a r l y Mr. 16 A. perhaps, b y the idea of a loan to a local My understanding, What I a m t r y i n g to in t h e b a n k or m o r e Traynor? s u c h as it is, is t h a t it w o u l d b e 17 a process 18 r e c o l l e c t i o n o f a n y of t h e o n e s t h a t I c a n r e c a l l 19 where the client h ad a n e e d for funds 20 p a r t i c u l a r p u r p o s e a n d w i s h e d to b o r r o w . Obviously 21 if t h e y h a d f u n d s o f f - s h o r e w i t h G u i n n e s s & Mahon 22 the b o r r o w i n g w o u l d be f air ly e a s i l y done t hr o u g h 23 Guinness 24 g o i n g t h e o t h e r way, 25 is o n l y m y e x p e r i e n c e o f it. 26 154 Q. i n i t i a t e d b y a client w o u l d be m y & Mahon. for a I d o n ' t h a v e a n y s e n s e of it the w a y you described, I n e s s e n c e y o u s a i d t h a t y o u t h o u g h t t h a t s o m e of 27 t h e l o a n a p p l i c a t i o n s m a y h a v e c o m e f r o m Mr. 28 himself? 29 but that Traynor 1 application, 2 lending people, 3 t h e m o s t l i k e l y case, 4 or a r o l l o v e r . 5 l o a n h a d to come up for renewal. 6 o n a -- m y m e m o r y is of a lo t o f t h e b a c k - t o - b a c k s 7 is t h e y j u s t c a m e u p y e a r a f t e r y e a r f o r r e n e w a l , 8 they were like h ardy annuals, 9 t y p e loans. he w o u l d instruct, probably, Pa t O ' D w y e r I w o u l d s a y These w o u l d come up e v e r y time a 11 for many, change and the but th e y were on the b ooks m a n y y e a r s m o s t o f them. On the first o c c a s i o n wh e n a b a c k - t o - b a c k loan was 13 b e i n g created, 14 not have known about the de posit? 15 A. T he y w o u l d come up they were evergreen The amounts might a m o u n t s m i g h t not change, 1 55 Q. one of the to p r e p a r e a l o a n a p p l i c a t i o n 10 12 probably, the lending people down stairs would T h e y m i g h t o r m i g h t not. They might have known that 16 there were funds and they m a y have been told by 17 Mr. 18 a n d Mr. 19 1 5 6 Q. T r a y n o r t h a t t h a t is a l l r i g h t y o u c a n p u t in T r a y n o r w o u l d s a y t h i s is a l l r i g h t . T h e i m p r e s s i o n y o u g i v e is t h a t it w o u l d h a v e h a d to 20 h a v e Mr. 21 occasion? 22 A. Traynor's i n v o l v em en t on the first I d o n ' t t h i n k a n y l o a n w a s e v e r g i v e n on 23 b a c k - t o - b a c k basis, 24 Mr. 25 understanding. 26 r e l a t i o n to that 27 p r i m a r y source of approval. T h a t is m y b e l i e f . 28 is n o t a f o r m a l i s e d p r o c e s s , Mr. 29 g o i n g b a c k o v e r a v e r y l o n g p e r i o d of t i m e b u t m y Traynor's would be m y impression, approval. without That w o u l d be m y I t h i n k in r e l a t i o n t o a n y m a t t e r in I t h i n k Mr. T ra y n o r w o u l d be the Rowan, It and we are 1 i m p r e s s i o n is t h a t Mr. 2 k n o w n o r a p p r o v e d it. 3 Y o u k n o w b e t t e r t h a n I, t h a t b a n k s w i l l l e n d m o n e y 4 on two p remises: 5 o t h e r is o n f o o t o f c a s h f l o w w h e r e t h e r e is a 6 business proposition? 7 A 8 158 Q 9 A 10 159 Q That's of course, 12 d e p o s i t the n , 13 secured? 15 1 60 Q 16 b anks p r e f e r to h o l d se curity? A n d i n c i r c u m s t a n c e s w h e r e a b a n k h e l d an equivalent, A s o r r y h a d a c c e s s to a n e q u i v a l e n t o n t h e f a c e o f it, O n t h e f a c e o f it de facto, A 18 1 61 Q 19 A yes, the bank was fully that's correct. Do y o u t h i n k t h a t u n d e r t h e b a c k - t o - b a c k l o a n arrangements Guinness 17 yes. I t hink u s u a l l y that's correct. 11 14 O n e is o n f o o t of s e c u r i t y a n d t h e some of the reasons, I n fact, Well, Traynor would certainly have In prac t i c e , & Mahon were fully secured? yes. W h y do you say that? I say that b e c a u s e on the b a c k - t o - b a c k ar r a n g e m e n t s 20 a n d I b e l i e v e t h a t t h e f u n d s w e r e h y p o t h e c a t e d to 21 the o ff - s h o r e 22 b a n k ha d the know le dge of that that the funds were 23 blocked. 24 d i r e c t l y t o t h e b a n k in D u b l i n is m y m e m o r y , 25 t h e y w e r e h y p o t h e c a t e d to t h e o f f - s h o r e 26 and t aken on a g roup b asis the b a n k h a d no exposure. 27 So l e t us s u p p o s e a l o a n h a d g o n e w r o n g so t h a t an 28 i n d i v i d u a l o r a c o m p a n y h a d b e c o m e i n s o l v e n t a n d it 29 a p p e a r e d t h a t t h e l o a n w a s n o t g o i n g t o be s u b s idi ar ie s b y the d e p o s i t o r a nd the I don't believe they were hypothecated but subsidiaries 1 recoverable, 2 loan, 3 a b o u t r e c o v e r i n g it s l e n d i n g a g a i n s t t h e d e p o s i t ? 4 I p r e s u m e that t here was some s e c u r i t y in the 5 facil i t y letter. 6 r e c o l l e c t i o n of that ever h a p p e n i n g where the b a n k 7 ha d to access, 8 h a v e n o r e c o l l e c t i o n of a s i t u a t i o n e v e r a r i s i n g 9 w h e r e t h e b a n k h a d to h a v e r e c o u r s e t o go t o o n e of h o w do y o u t h i n k t h e p r o v i d e r of t h e w h i c h was the D u b l i n bank, would have gone In al l o f m y t i m e I h a v e no I c o u l d n ' t b e c e r t a i n of this, 10 it s s u b s i d i a r i e s to t r y a n d r e c o v e r t h e — 11 recollection. 12 1 63 Q 13 A 14 164 Q In t h e o r e t i c a l t e r m s h o w m i g h t I c a n ' t s p e c u l a t e o n that, but I I h a v e no it h a v e h a p p e n e d ? I j u s t d o n ' t know. So that w h e n the b a c k - t o - b a c k loan a p p l i c a t i o n came 15 before the credit committee the credit committee 16 went through the application and the term "suitably 17 s e c u r e d " o r s o m e t h i n g s i m i l a r to t h a t w o u l d h a v e 18 b e e n u s e d o n t h e a p p l i c a t i o n a n d it w o u l d h a v e b e e n 19 approved? 20 A 21 1 65 Q 22 A 23 16 6 Q That's correct. A n d t hose m i n u t e s w o u l d then have gone to the Board? To t h e B o a r d . Y o u s a i d s o m e t h i n g to t h e e f f e c t t h a t L o n d o n h a d a 24 keen interest 25 back-to-back arrangements? 26 A i n k n o w i n g w h i c h l o a n s w e r e s u b j e c t to I t h i n k Lo n d o n h ad a keen inter es t in all loans m ad e 27 b y Dublin. 28 I wasn't on the b a n k i n g side but I b e l i e v e that 29 t h e r e w e r e c e r t a i n r e t u r n s d o n e f r o m D u b l i n to I a m n o t t h e o n e to a n s w e r t h i s in t h a t 1 L o n d o n on a n o r m a l r e p o r t i n g b a s i s a n d a l s o all 2 loans a bove a c e r t a i n figure, 3 at v a r i o u s t i m e s h a d to b e r e a p p r o v e d b y L o n d o n . 4 addition, 5 D u b l i n who w o u l d attend, 6 c e r t a i n l y a n u m b e r of t h e m . 7 in the 8 a h i g h d e g r e e o f -- p l u s t h e y w o u l d d o l o a n r e v i e w s 9 on a regular basis. which would have moved L o n d o n h a d d i r e c t o r s o n t h e B o a r d of not all B o a r d meetings, T here were, ' 8 0's a s i t u a t i o n w h e r e t h e r e w o u l d h a v e b e e n They w o u l d come to Du bli n and do l o a n r e v i e w s , 11 r e p o r t i n g r e q u i r e m e n t s b e t w e e n the p ar e n t and the 12 s u b s i d i a r y w h i c h h a d be e n t i g h t e n e d up ve r y 13 c o n s i d e r a b l y in the 14 t h i n g s h a d g o n e awry. 167 Q. but certainly, 10 15 In go t h r o u g h t h e l o a n b o o k . '70's b e c a u s e T a k i n g a l l o f t h i s in t h e r o u n d , Normal I t h i n k some there was a fairly 16 h i g h d e g r e e o f s e c r e c y i n v o l v e d i n t h e o p e r a t i o n of 17 the Channel 18 A. 19 I s l a n d s a n d C o l l e g e T r u s t e e s a n d so o n ? I t h i n k it b e c a m e -- it w a s n ' t at f i r s t it b e c a m e progressively more 20 168 Q. 21 A. T h a t w a s Mr. Traynor's f e e l f o r it. 23 Channel 24 all the decisions, 25 c a n ' t say. 1 6 9 Q. 27 28 29 I w o u l d w i t h a g r e e tha t . Do yo u h a v e a f e e l i n g for w h y that was? 22 26 secret, D i d he, instructions. I don't have a E v e r y t h i n g to do w i t h C a y m a n a n d t h e I s l a n d s g o e s b a c k to Mr. he d e c i d e d , as a m a n a g e m e n t st y l e , Traynor. He m a d e w h y he d e c i d e d I seek to im press upon his s ub o r d i n a t e s the n ee d for secrecy? A. I t h i n k n o m o r e t h a n -- y o u w o r k e d i n a bank, e v e r y t h i n g is c o n f i d e n t i a l in a b a n k . 1 I t h i n k t h e r e is an e s s e n t i a l d i f f e r e n c e b e t w e e n t h e 2 n e e d for confidenti al it y, 3 f e a t u r e in m a n y c o m m e r c i a l o r g a n i s a t i o n s , 4 i ssue of s e c r e c y ? 5 A I think, w h i c h is n o t a n u n c o m m o n and the I m e a n I f i n d it d i f f i c u l t t o a n s w e r in t h e 6 c o n t e x t of b e i n g p e r s o n a l l y a w a r e t h a t 7 w i t h y o u r l i f e " t y p e of, 8 H e w a s a m a n w h o t e n d e d to g i v e p e o p l e j u s t a b o u t 9 e n o u g h i n f o r m a t i o n as t h e y n e e d e d t o d o t o e x e c u t e I a m n o t c o n s c i o u s o f tha t . 10 w h a t e v e r h e w a n t e d t h e m to do. 11 of t h e man. 12 1 71 Q 13 14 He s u b d i v i d e d r e s p o n s i b i l i t i e s way; A "guard this T h a t is t h e n a t u r e in a n i n t e r e s t i n g d i d n ' t he? H e did, yes. I don't know what you mean by 15 interesting but various people had responsibilities 16 a n d Mr. 17 a s k e d you to do something, 18 w a n t e d you to do a n d gave yo u the i n f o r m a t i o n 19 n e c e s s a r y f o r y o u to c a r r y out, 20 e x p l a i n i n g w h e r e it f i t t e d i n t o a w i d e r p i c t u r e of 21 things. 22 172 Q 23 Traynor, m y m e m o r y o f h i m is t h a t if he h e m a d e it c l e a r w h a t he without necessarily So me on e else n e e d e d to h ave the b i g picture, did t hey not? 24 A 25 1 73 Q 26 A 27 174 Q W h e n you say "the b i g p i c t u r e " ? Y o u j u s t s a i d t h a t Mr. Traynor.. . (INTERJECTION). I am just t a lking generally. B u t t h a t Mr. T r a y n o r w o u l d h a v e e x p l a i n e d t o an 28 i n d i v i d u a l w h a t he w a n t e d t h a t i n d i v i d u a l t o do a n d 29 t h e r e f o r e he w o u l d have a s k e d p e o p l e to do v a r i o u s 1 2 Yes . 3 1 75 Q 4 A 5 176 Q Yes, that's correct, So Mr. yes. T r a y n o r h a d a v i e w o f h o w a l l of t h i s w a s o p e r a t i n g a nd h o w one t hi ng r e l a t e d to the other? 6 7 T h e t a s k b e i n g to l o o k a f t e r t h e c l i e n t s ? A W h e n you say one thing, Mr. T r a y n o r i n t h e e n d of 8 t h e d a y i f w e g o to t h e p e r i o d p o s t 9 a n d Mr. like, 11 individual 12 about. 177 Q clients, I a m b e g i n n i n g to l o s e t h i s a bit. I was g o i n g to us e an e x p r e s s i o n , o n e t a l k s in 15 t h a t k e y m a n a g e r f a l l s u n d e r a bus; 16 ava i l a b l e wit h no notice, 17 that case w ould have been responsible 18 instructions ? 20 178 Q 21 A 22 23 if y o u if t h a t is w h a t y o u a r e t a l k i n g m a n a g e m e n t terms of a key manager, A Traynor a c c e s s t o t h e o v e r a l l p o s i t i o n i n r e l a t i o n to 14 19 Mr. C o l l e r y w e r e t h e o n l y p e o p l e w i th, 10 13 '79, w h a t h a p p e n s if i.e. is n o t or short notice. W h o in for g iv ing the What instructions. If Mr. Tr ay n o r h a d not b e e n a v a il ab le? I am not sure what you m e a n b e c a u s e un less you are talking about a p articular instance. 179 Q Y o u s a i d t h a t Mr. Tr ay n o r was the m a n who h ad the 24 k n o w l e d g e of the o v e r v i e w of the w h o l e t h i n g an d 25 that you had some know le dge of things and 26 Mr. 27 o t h e r p e o p l e h a d s o m e k n o w l e d g e of t h i n g s , 28 Mr. 29 on his b e h a l f ? C o l l e r y h a d s o m e k n o w l e d g e of t h i n g s a n d p e r h a p s b u t if Tr ay n o r h a d not b ee n t here who w o u l d have a c te d 1 I d o n ' t know. 2 si t u a t i o n w h er e someone a p p l i e d for a loan for a 3 back-to-back, 4 1 80 Q In w h a t c i r c u m s t a n c e s , is t h a t w h a t y o u a r e s u g g e s t i n g ? A n y of the t o p i c s that w o u l d h a v e r e q u i r e d the 5 k n ow le dg e of clients' 6 w o u l d h a v e h a d to h a v e h a d ? 7 A let's say a a f f a i r s w h i c h Mr. Traynor A r e w e t a l k i n g a b o u t k n o w l e d g e of c l i e n t s ' affairs 8 in the c o n t e x t that the c l i e n t s h a d funds in w i t h 9 su bs i d i a r i e s or trusts? 10 1 81 Q 11 A That sort of thing, yes. I just don't I just know. f i n d it d i f f i c u l t to 12 fo ll ow your line of enquiry. 13 Mr. 14 v i e w t h a t r a r e l y w o u l d m a t t e r s b e of s u c h a n u r g e n t 15 n a t u r e t h a t it c o u l d n ' t w a i t 16 attention. 17 182 Q Traynor was always available, 19 first instance? 21 1 83 Q for Mr. Traynor's W e h a v e h a d it e x p l a i n e d to us t h a t v e r y m a n y p e o p l e e l e c t e d t o d e a l w i t h Mr. A a n d it w o u l d b e m y T h a t w o u l d b e m y v i e w of it. 18 20 T h e r e a l i t y is t h a t T r a y n o r h i m s e l f in the Yes . And really what I a m a s k i n g you, and you m a y not 22 k n o w a n d a p p r e c i a t e that, 23 decided, 24 d e a l w i t h Mr. 25 there who might they then have dealt with? 26 T h e y m i g h t h a v e d e a l t w i t h a n y n u m b e r of p e o p l e t h a t 27 t h e y m a y h a v e c o m e in c o n t a c t w i t h i n t h e b a nk. 28 T h i s b a n k w a s a s m a l l b a n k a n d Mr. 29 h a v e had, I a m a s k i n g y o u if p e o p l e for w h a t e v e r reason, t h a t t h e y w a n t e d to T r a y n o r a n d h a d Mr. I w o u l d say, a lo t of, Tray n o r not b een Traynor would I t h i n k it is w e l l 1 e s t a b l i s h e d now, 2 w e r e p e r s o n a l to h i m an d I d o n ' t b e l i e v e that t h e y 3 d e a l t w i t h a n y b o d y e l s e in t h e b a n k . 4 w i t h Mr. 5 years w ould have had that 6 e n a b l e h i m t o s t e p i n t o t h e role, 7 a w f u l l o t o f p e o p l e d e a l t d i r e c t l y w i t h Mr. 8 a n d Mr. 9 s o m e b o d y e l s e in the b a n k wh o m i g h t h a v e some a lo t o f v e r y p r i v a t e c l i e n t s w h o T r a y n o r w h e t h e r Mr. T r a y n o r al o n e , They dealt C o l l e r y m a y b e in l a t t e r k i n d of k n o w l e d g e to b u t I t h i n k an as y o u say. Traynor They might 10 knowledge. 11 c o n s c i o u s t h i n g o f it a r i s i n g . 12 -- I g a v e a n i n s t a n c e w h i c h was, 13 f o r me, 14 c a l l e d to M o r i a r t y T r i b u n a l 15 Mr. 16 l o o k i n g a f t e r s o m e m o n e y f o r Mr. 17 he e v e r w a s n ' t 18 t h a t h e w o u l d a s k fo r me. 19 Mr. 20 circumstance, 21 It w a s a s m a l l b a n k so p e o p l e w o u l d e s t a b l i s h 22 info rm al r e l a t i o n s h i p s or h ave knowledge. 23 f i n d it h a r d t o d e f i n e it. 24 184 Q. I d o n ' t t h i n k it a r o s e . know I don't have any The i n s ta nce I gave an u nu s u a l in st anc e of De p u t y F oley w he re the r e a s o n I was F o l e y o n c e a n d Mr. last wee k was T r a y n o r h a d t o l d m e he w a s F o l e y a n d t h a t if in t h e b a n k w h e n Mr. F o l e y e v e r y ag a i n , I had met Foley called I never actually met but that was a very unusual but p e o p l e w o u l d deal w i t h the bank. I just I f u l l y u n d e r s t a n d t h a t it w a s a s m a l l b a n k a n d I 25 f u l l y u n d e r s t a n d t h a t Mr. 26 influence and I also fully u n d e r s t a n d that 27 Mr. 28 n e e d for secrecy. 29 the n e e d for s e c r e c y m e a n s that i n d i v i d u a l s get Traynor was a significant Traynor increasingly decided that there was a W he n you put all that together, 1 i n f o r m a t i o n o n a n e e d to k n o w b a s i s w h i c h m e a n s t h a t 2 i f Mr. 3 a s p e c t w o u l d have, 4 a n y o n e e l s e t o h a v e f i l l e d t h e r o l e t h a t Mr. 5 had? 6 A. 7 1 85 Q. T r a y n o r w e r e n o t to b e t h e r e t h e n t h e s e c r e c y perhaps, m a d e it d i f f i c u l t A n d t h a t is a v e r y i n t e r e s t i n g p h e n o m e n a w h e n y o u t h i n k a b o u t t h e f a c t t h a t in t h e e a r l y 9 s u b s t an ti al p r o p o r t i o n of Gui nn es s 11 '80's a v e r y & Mahon's assets w e r e t i e d up in the C a y m a n o p e r a t i o n ? A. 12 13 1 8 6 Q. I c a n ' t c o m m e n t on that. MR. ROWAN: T h a n k you v e r y much. MR. JUSTICE COSTELLO: Just one p oi nt b ef o r e 14 a s k Ms. Mackey. 15 f r o m w h a t Mr. 16 t h e r e is a d o c u m e n t , 17 at it, 18 f r o m Mr. 19 Mr. 20 accounts 21 w a s s u g g e s t i n g was: 22 "...on receiving the n e c e s s a r y request/ i n s t r u c t i o n we will t e le x G.M..." T h a t is D u b l i n . 23 24 25 26 27 28 29 Traynor I d o n ' t d i s a g r e e w i t h tha t . 8 10 fo r I Arising R ow an was as k i n g you about the se cr e c y I w o u l d just like to you look it is a d o c u m e n t o f 3 1 s t A u g u s t , Lipscombe. 1987 to y o u T h i s is a m e m o r a n d u m f r o m L i p s c o m b e t o y o u a n d it is a b o u t o p e n i n g o f b a n k in g e n e r a l a c c o u n t s Exhibit in L o n d o n a n d w h a t he IV. " . . . t o t r a n s f e r t h e n e c e s s a r y s u m to o u r g e n e r a l a c c o u n t G . M & Co. GMG will th e n issue a cheque on the g eneral a c c o u n t i n f a v o u r of t h e n o m i n a t e d p e r s o n i n I r e l a n d or p o s s i b l y t o cash. T h e c h e q u e w i l l be r e m i t t e d to us as per the instructions GMG receives..." 1 2 "... G & M r e m i t f u n d s a n d c r e d i t t o o u r c a l l d e p o s i t a c c o u n t a d v i s i n g us of t h e r emittance and two days after the funds h a v e b e e n c r e d i t e d to G M G 's a c c o u n t t h e y w i l l b e r e t u r n e d ...... " 3 4 Do y o u r e m e m b e r t h i s ? 5 6 A. Very vaguely. I a m j u s t t r y i n g t o r e a d it. 7 h e is w r i t i n g w e a r i n g h i s G u i n n e s s 8 hat. 9 187 Q. Yes. I think & Mahon Guernsey A n d it is m o n e y t h a t is in D u b l i n a n d t h e i d e a is t h a t : 10 "...on receiving the n e c e s s a r y request/ i n s t r u c t i o n w e w i l l t e l e x G. M to t r a n s f e r ..." 11 12 13 T h e i d e a is t h a t G u i n n e s s 14 i n s t r u c t h i m t o t e l l t h e m to t r a n s f e r t h e n e c e s s a r y 15 s u m t o o u r g e n e r a l a c c o u n t in L o n d o n . 16 w o u l d b e t r a n s f e r r e d to L o n d o n . 17 t h e G u e r n s e y c o m p a n y w o u l d t h e n i s s u e a c h e q u e to 18 the g eneral account in f avour of the n o m i n a t e d 19 p e r s o n in Ireland. 20 f r o m D u b l i n w o u l d b e c o m i n g f r o m G u e r n s e y or in c a s h 21 a n d a c h e q u e w o u l d b e r e m i t t e d to us b y t h e 22 i n s t r u c t i o n s that the G u e r n s e y peo p l e receive. 23 T h e s e a r e s e n t d i r e c t l y to t h e n o m i n a t e d p e r s o n , 24 yourselves, 25 A. 26 188 Q. 27 A. No, & Mahon Dublin would The m o n e y T h e n GMG, t h a t is So t h e m o n e y i n s t e a d of c o m i n g to do yo u r e m e m b e r this? I don't. D o y o u r e m e m b e r w a s it o p e r a t e d ? I d o n ' t t h i n k it w a s o p e r a t e d b e c a u s e 28 p e r i o d o f t i m e w h e n Mr. 29 Guinness I t h i n k the Lipscombe was involved with & M a h o n G u e r n s e y was r e l a t i v e l y short. I 1 t h i n k t h e y m a y h a v e i n t e n d e d to se t it u p t h i s way, 2 b u t it d i d n ' t a c t u a l l y o p e r a t e t h i s way. 3 MR. JUSTICE COSTELLO: 4 MR. K E A N E W A S T H E N E X A M I N E D B Y MS. 5 FOLLOWS V e r y wel l . MACKEY, AS 6 7 189 Q MS. MACKEY: It is a l l i n r e l a t i o n to 8 the c h ange over in 1981 9 w h e n the funds, as y o u p u t it, in t h e C h a n n e l 10 I s l a n d s in C o l l e g e T r u s t e e s w e r e r o u t e d vi a C a y m a n 11 a n d w e t h e n h a d t h e a c c o u n t t h a t w a s o p e n e d h e r e in 12 Guinness 13 T r u s t Re C o l l e g e Trust e e s . 14 c l e a r a b o u t t h a t is w h a t e x a c t l y h a p p e n e d t o t h e 15 individual 16 w h e n t h e c h a n g e o v e r h a p p e n e d y o u a l r e a d y h a d in 17 Guinness 18 pooled account? 19 A & Mahon Cayman W h a t I j u s t w a n t to g e t accounts that were invo l v e d there. & Mahon a Guinness So & Mahon Cayman Trust s o r r y t o k e e p t r a c k o f thi s . We had a Guinness & M a h o n C a y m a n T r u s t a c c o u n t in D u b l i n . 20 21 Yes, & Mahon called Guinness 1 90 Q 22 I a m a s k i n g you, account 23 A 24 1 91 Q 25 A 27 192 Q for G u i nn ess I believe & Mahon Cayman trust? so. Wa s this an a d d i t i o n a l a n d n e w a c c o u n t t h a t was opened, 26 h a d w e at t h a t t i m e t h e m a i n p o o l e d Guinness & M a h o n C a y m a n T r u s t Re C o l l e g e ? I b e l i e v e so. H a d it, s i m i l a r to t h e o t h e r p o o l e d a c c o u n t , 28 subaccounts ? 29 It had, m y u n d e r s t a n d i n g is t h a t it had. 58 I wasn't 1 2 1 93 Q Y o u r u n d e r s t a n d i n g is a l l I a m l o o k i n g f o r at t h i s 3 stage. 4 that had originally been with College Trustees? 5 A 6 194 Q 7 8 Yes, A n d t hose s u b a c c ou nts r e l a t e d to ac counts I b e l i e v e so. W e r e t h e y k e p t on t h e b u r e a u a c c o u n t s y s t e m h e r e in Dublin? A 9 My understanding, s t a r t e d off, 10 1 95 Q 11 A So this was I am not sure when the bureau I t h i n k it w a s 1979. 1981? Without the records I would have difficulty with 12 thi s , 13 earlier was that the Bureau started with CMC and 14 GMCT; 15 I a m at a l o ss. 16 account, 17 m o n e y just m o v i n g into a GMCT account via College 18 in s t e a d of a Gui nne ss & M a h o n G u e r n s e y account, 19 was m y r ecollection. I t h i n k w e d i s c u s s e d it 20 earlier. 21 b o o k k e e p i n g e n t r y e v e n t h o u g h it m a y s e e m l i k e t h e 22 m o n e y goes all the w a y a r o u n d the world, 23 is b a s i c a l l y a b o o k k e e p i n g e n t r y . 24 196 Q b u t m y t h o u g h t was, is t h a t c o r r e c t ? I d o n ' t h a v e t h e r e c o r d s so M y u n d e r s t a n d i n g is t h a t t h e p o o l e d G M C T R e C o l l e g e is t h e C h a n n e l Who operated the individual accounts, the individual 26 of t h i s . . . ( I N T E R J E C T I O N ) . A 28 29 that i n f a c t it who controlled accounts that were under the heading T hey are into the b u r e a u s y s t e m the n t h e y are un der t h e c o n t r o l o f Mr. 197 Q Islands' That w o u l d l i t e r a l l y be n e a r l y a 25 27 I t h o u g h t w e c o v e r e d it Mr. Collery. C o l l e r y a c t u a l l y c o n t r o l l e d t h e s u b a c c o u n t s of 59 1 2 A. T h a t is m y u n d e r s t a n d i n g . In t h e s e n s e t h a t t h e y 3 a r e o n t h e b u r e a u s y s t e m so y o u h a v e i n t h e b a nk, 4 you have two big accounts which s u b s e quently become 5 one b i g acc ou nt wit h two subaccounts, 6 o n e G M C T a n d o n e G M G p r i o r to t h a t d a t e . 7 I am just going from pure m e m o r y and then that they 8 become effectively, 9 ba n k , 10 11 And again s h e e t of t h e b e c o m e o n e a m o u n t w h i c h is a G M C T d e p o s i t b u t it h a s t w o b u r e a u l e d g e r s . 198 Q. S o i n f a c t t h e G M C T Re C o l l e g e w o u l d h a v e b e e n a 12 subaccount 13 right? 14 in the b a l a n c e like we had A. of the m a i n G M C T p o o l e d account; I honestly don't know. is t h a t T h i s is n o t m y p r o v i n c e . 15 i m p r e s s i o n w a s t h a t t h e r e w e r e two, 16 sy s t e m c o n t a i n e d two sets of subaccounts, 17 r e l a t e d to the C h a n n e l 18 Cayman. 19 r e l a t e d to the C h a n n e l 20 d e s i g n a t i o n G M C T Re C o l l e g e . 21 sheet point of v i e w i n s t e a d of s how i n g an amount 22 w h i c h t h e b a n k w o u l d o w e to G u e r n s e y a n d a n a m o u n t 23 t h a t t h e b a n k w o u l d o w e to C a y m a n , 24 w o u l d n o w b e s h o w n as o w e d to C a y m a n . 25 1 9 9 Q. Mr. 26 27 28 29 Right, A. My the bureau one I s l a n d s a n d o n e r e l a t e d to A l l t h a t h a p p e n e d is t h a t t h e o n e t h a t I understand. Islands was g i ve n a the entire amount All this was o p e r a t e d by Collery? The b u r e a u system, So f r o m t h e b a l a n c e yes. 1 2 your a t t e n d a n c e we w o u l d 3 a s k y o u t o s i g n t h e t r a n s c r i p t w h e n it is m a d e 4 a v a i l a b l e a n d Ms. 5 you. C ummins will get in t o u c h with 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE HEARING WAS THEN CONCLUDED 4597/? or?) Few/w A 7 n, 391,?? vb /C~~ ■( ■"-V ■*tr ^= V — 'i i fly-Qj ^Ls ^ ---- - . ■ d L s i.u .ji A l A v E . ------- (q M v pg^o. ■ C ^A Q p J? 'J---------------------- Jf----------------- — v M J L M '£ d & J . ------- i . ------------------- ------- --------------- f e . — ---------------------------------- — ------- -— o ---- tr rp y ^ m A»C r 0 K J . ^ Jr h U ---------------- — -------------------- • W-*-, % A i U J ^ - ^ L ^ ---- --------------------- s --------------- -- S v * * r^-, * ........... ..............— -------------------- — ------------------ ------- . , , : MCE he o f ---------------------- ---------------- ap p u cautS e u Cio o»ras RPO SE: J T i t f b o \ ^ 0-£ ^ O e S T H & S K v ( b U T o itie .) . f .O .l l v K ^ /* o A / th n . L t V ^ j [r 3 ,M lu'AuE OF REPAYMENTS: .TE: A v DATE * 1 .1+ ..G * M INUTE NUMBER 0i?-€/ /ja ^ g A < L j^ C J o A t- k*-&K.fliL.g (ef?£ ^ /fs ifc T d . " m )MMITMENT F E E : ' A f l L ^ ■ /^ > WN : ^ ^ dj-cy ‘a T i r : ^ **>■ VIEW D A TE : H .. ^ /tcCcVtwt-. c 4= 3 W .£V M M . t RELEVANT c o m m e n t s f o r ORATION I N D E C IS IO N MEMO, -m u e d O v e rle a f) : k k .w ^ w & jrf -fe u v /c ^ a o /^ W . TO: BRENDAN DONNELLY. . FRQf4: PAT O'DWYER. RE : SELIMA INVESTMENTS LIMITED : 'ACCOUNT NO. 07318006, ■ INTEREST 18/9/84 : S t g : £486,248.00 S t g : £ 25,165.83. £511,413.83. Stg, Please arrange to change name o f the above account to : Montoire L im ite d . ' 16 C la y b e ll House, Somers C lo s e , ' ' Somers Road, R eigate, S u rr e y . There i s a S t e r l i n g Loan o f £4863248 outstanding and the attached dividend f o r IRP £14,437.50 should be c re d ite d to the account. As s e c u r i t y f o r the lo a n , I have been Informed by M .E .O 'K . t h a t we are to h o ld the attached Share C e r t i f i c a t e f o r 350,000 James Crean L im ite d O rd in a ry Shares - 25p each. . P0D :AB.. . , 11th . September 1984. f t * 0 - Appendixxv<79> - Copy of fa cility letter duly signed by authorised';signatories. ^ Copy of Board Resolution authorising borrowing, x' Blank transfer over 350 James Crean Limited shares. X* Power o f sale over 350 James Crean Limited shares. Guarantee fo Ray McLoughlin. pThis loan may have been the subject of further discussion with Ray McLoughlin, in the m eantim e however my security remains incomplete. PO'D/SC 14th December, 1984. TO: BRENDAN DONNELLY. FROM: RU LEONARD. RE: MONTOIRE LIMITED. / The borrowing i n the name o f the ^bove has been switched to Dewdrop Investments L im ite d . External I r i s h Pounds you hold on deposit i n a n t ic ip a t io n o f i n t e r e s t in A p r i l should be i d e n t i f i e d w ith the new borrowing Company. 26th.March 1985. ’ TO: GUINNESS + M A H O N 17, College Graen, DUBLIN 2 cf b r< D ' p o o LIMITED, C Z t M P flr i'h Q fi2 > yts/ A f t v ^2^j> WHEREAS we, the undersigned, have transferred the above mentioned Shares (which are our property) into the name o f your. Nominee Company. NOW WE HEREBY DECLARE that the said shares are held by you as collateral and continuing security for all the liabilities of P ~ 3 jh i \/£ S < N \ c ~ W to you present and future sole or joint and we undertake to execute such further transfer or other documents as you may from time to tim e require to be signed by us. Dated the ' day of ------------- (T . S c o t t , D i r e c t o r ) SIGNED by 3&8as 3 $j$c 1/ • For an4> "on beh>K of DEWDROP INVESTMENT LIMITED in the presence of: ts GU1NNESS+MAHON LTD 17 CciUga Gr.ian Cubiin 2 P.O. 2o:« SSATel: 796944 (3Q Lines) BANKERS Our R ef: P O 'D /S C 2 8 th M ay, 1985. T h e Secretary, D e w d r o p I n v e s t m e n t s L im ite d , P . O. B o x 223, P l a t e a u M ign ot, R u e d es C ornets, ,<*sSt. P e t e r P ort, ‘ G u ern sey, C H A N N E L ISLA N D S • D e a r Sir, . ■ F o llo w in g r e c e n t d is c u s s io n s w a now h a v e p le a s u r e in co n firm in g th at w e are p repared to p la c e at y o u r disposal a f a c i l i t y s u b j e c t to th e fo llo w in g t e r m s and c o n d itio n s :Borrower: D e w d r o p I n v e s tm e n ts L im ite d . A m ount: Stg.:£15S,2 5 0 .0 0 (One H undred and F ifty S ix Thousand, T w o Hundred and F i f t y Pounds) - S t e r lin g . H o w e v e r , as a g r e e d th e funds have b een tak en up by y o u in D e u t s c h e M arks i .e . D.M. 611,250.00* T e . m: In a c c o r d a n c e w it h n orm al banking p r a c tic e alt funds taken up are r e p a y a b le on dem and but in any c a s e not l a t e r than 22nd O ctob er, 1985. Purpose: T h e funds a r e b e in g p l a c e d a t your d isp osal to . a s s is t you t a k e n :u p vrights in . th e .form: o f 8 7 ,5 0 0 J a m es C r e a n Llm ItediOrdinary''..25p-shares.:.and. £1 5 7 ,5 0 0 .00 10% O rdinary C o n v e r t ib le U nsecured :!-Loan. S to c k 1995.- D raw dow n: By w a y o f loan a c c o u n t in th e n am e o f D ew drop I n v e s t m e n t s L im it e d . W e a tta c h a c o n tr a c t n o te sh ow in g t h e ' r e l a t i v e d e t a ils . In terest: W e p ropose c h a r g in g i n t e r e s t on th e loan a t 2% in e x c e s s o f t h e c o s t t o G uin n ess + M ahon L im ited o f takin g D e u t s c h e M ark D e p o s i t s to 22nd O ctob er, 1935. The p r e s e n t e f f e c t i v e r a te is th e r e fo r e 73% per annum . We sh all apply to you for p a y m e n t o f in te r e st im m e d ia t e ly a f t e r th a t d a te . Telegram*: Wan. Dublin. Talox; 25205. 5 N o n -S :: cu tivs O ifa c to n : J .H . G u in n a ii (C h a irm a n ), J .C . Lov-a J o * ,,R .A . M o rto n {B r it ls J it »D tT , O 'C o n n o r* a 5 5 3 .5 6 . T h ese :u n c s w-tc* p l a c e d c n d e p o s i t a c c o u n t to 2 7 / 3 / 3 5 a t U i % p.a. to m e e t th e loans a : ,T.3:ur:. ; / , Oa'27:n A u g u s t , 1335 w e c o n v e r t e d che principal plus In te rest o f o c g .iU .r. S o T. 3 0 to U.S..B ac 1.3970 a n d c r e d i t e d t h e resu ltin g U .S .$ 1 6 7 ,595.16 t o t n e DewJ.-oo i n v e s t m e n t s L i m i t e d l o a n a cco u n t. On c/i3 2 7 cn A u g u st, 1935 th e loans op en ed to m eet the ch arges in r e s p e c t o f sw itch in g c u r -e n c ie s on the 6 / 3 / 3 5 in ad van ce o f the m atu rity d a tes w ere t r a n s fe r r e d to the principal loan a cco u n ts as fo llo w s:D e w ':ro p I n v e s t m e n t s - Loan D M . 6,814.23 . , D .M .5 ,5 0 6 , ;33 plus a c c r u e d i n t e r e s t o f D.iVl.21.63 D .M .I,3 0 7 ,4 0 plus a c c r u e d i n t e r e s t o f D .M . 5.15 = D .M .5,528.56 at 2 .7 5 8 0 ** U .S .$ 2 ,0 0 4 .5 5 = D .M .1*312.55 a t 2 .7 5 8 0 *» U .S .$ 475.91 M alm aison L im ited ^ D .M .3 ,8 3 5 ,0 6 plus a c c r u e d i n t e r e s t o f D.M.14.51 = D .M .3,699.57 a t 2 .7 5 8 0 a U .S .$ i,341.40 .T h e p o sition on the t h r e e loan a c c o u n t s a s a t 2 7 / 8 / 8 5 w as as fo llo w s:­ ./ • D ew drop In vestm en ts ' P r in c ip a l plus i n t e r e s t to 2 7 / 8 / 3 5 less proceeds o f D ep osit A c c o u n t P en a lty charge - U .S .$ 6 9 9 ,0 0 8 .4 4 U .S .$167,595.16 U .S .$ 5 3 1 ,413.28 U .S .$ 2 ,0 0 4 .5 5 U .S . $ 5 3 3,417.83 . . .. P r in c ip a l plus i n t e r e s t to 2 7 / 3 / 8 5 P en a lty charge ' . - U .S .$ 2 2 6 ,2 5 9 .3 2 U .S .$ 475.91 U .S .$ 2 2 6 ,7 3 5 .2 3 - U .S .$ 5 0 9 ,4 8 4 .3 2 U . S . $ ' 1,341.40 U .S .$ 510,825.72 M a lm a is o n L im it e d P r in c ip a l plus .I n ter e st to 2 7 / 3 / 8 5 P e n a lty charge - T h e a b o v e loan s w e r e ' e x t e n d e d for a w eek to 3 / 9 / 8 5 at 10% ,p.a. On th e 3 / 9 / 3 5 t h e loan s w e r e e x t e n d e d to 5 / 9 / 8 5 a t 10% p.a. a s f o llo w s : ' D e w d r o p I n v e s tm e n ts L i m i t e d D e w d r o p I n v e s tm e n ts L i m it e d M a lm a is o n L im it e d - U .S .$ 5 3 4 ,4 5 5 .0 3 U .S .$227,176.10 U.S.$511,818.99 W hen th e loans m a tu r e on th e 5 th S e p t e m b e r , 1985 th ey w ill b e sw itc h e d to E C U 's as f o llo w s : - /, Dewdrop Investm ents Limited. Dewdrop Investm ents Lim ited Malmaison Lim ited U.S.$534,751.95 at .7803 = ECU's 685,315.84 U.S.$227,302.31 at .7803 = E C U ’s 291, 301.18 U.S.$512,103.33 at .7803 ■ ECU's 656,290.31 . The loans will then be drawn to 10.9.85 at 10 3/8 p.a. We enclose for your records deal slips and statements in respect of the foregoing. If you are unclear of any matter please do not hesitate to revert. Yours faithfully, * for GUINNESS + MAHON LIMITED. .Brendan Donnelly. • go 2 Wellington Road, Dublin 4 - «TV' '®4ch January 1986 Mr Pat O'Dwyer Guinness & Mahon 17 College Green Dublin 2 .. Dear Pat :i . mentioned to you that there was one urgent matter that I would like to ;discuss with you. . " i t is the matter of arranging a borrowing on behalf of »y brother to finance • the purchase of some Crean convertible Loan stock, which would be Issued under a placing to take place in the next few days. Yours sincerely a R J ^cj^oughlin t0 PAT 0 of GUINNESS mos LTD 14/1/86 acquis m o a A21D PLACIHG BY CHS All Ia tha next fav days C22AS ’ * 111 be announcing that agreement has been raachad to acquire a business in the U.S. which manufactures and markets its own brands of prepared frozen meals. ’ Tha purchase price will be $35m and a placing will be arranged in conjunction wieh tha approval of the deal by Crean's ‘ shareholders. Tha placing will raise Q . £ l Q m , half by the issue of new of ordinary sharas and half by the issue of new 10% redeemable convertible 1995 Loan S Cock. It is expected that the placing price for the ordinary shares will be about 2.60p per share and that the placing price for the Loan Stock will be about £.107,5 per £100 nominal value. ‘ • Information in relation to the acquisition is set out in Appendices (2), (3) and (4) and the effects of the acquisition on Crean are set out in Section (9). THE PRESENT POSITION OF MY BROTHER H o l d i n g ................... 488 N.V. Loan Stock Present Unit Value £ ' s ........ .........125 Present Total Value £000's............ 610 Borrowings (approx. ) ................... 160 ! NET-POSITION...... 450 HIS OBJECTIVE Ha would like to arrange a further borrowing from G.& M towards the purchase of additional Loan Stock to be Issued under the placing. I an not sure if he has an existing undrawn facility or whether that facility has lapsed. j At one stage borrowings under his facility were at a level of about [ £6/700,000. -a would lik.a to purcha 3 -a of the order of £.5m to £.75m. Sa would like you :o consider whether that would be possible and what the tarms of that facility would be. Sa would act be proposing to put up any cash towards the purchase of the Loan Stock on tha basis that there is considerable cover available to the Bank at tha moment in relation to the cover ratid which was deemed satisfactory to tha Bank at the time of first arranging the present facility and that tha surplus cover would be used as the risk capital involved in tha new purchase. ASSET AMD COV2R POSITION IF A PURCHASE WERE COMPLETED Assumptions (i) For tha purposes of calculation assume that G & M would lend an additional £.75a towards the purchase of additional Loan Stock. (ii) Assume that tha additional Loan Stock would be purchased at £107,5 so that tha £.75m would purchase new Loan Stock of £693,000 Nominal Value. Assets, Borrowings, Cover His total holding of Loan Stock would be Nominal Value £1.187m. Tha market value of the Loan Stock immediately after the transaction would be of the order of £1.483m. His total borrowings would be approximately £ . 9 1 m . Accordingly the loan would_ be covered 1.63 times. ihcohe gosrrioa t ' Tha yield on the Loan Stock will be IQS and therefore the net income would be approsiaately £77,000 p.a. . •« This would service an average interest cost of 8.5Z p.a. Once chare would be a re-alignment within the EMS he would propose to borrowing in DM's and tha prospective yield of 8.5X would probably be more than enough to pay DM interest rates. ^ Ix tha to sal yiali vara not sufficient to pay the interest charges at any time ha would propose zo meet tha ahort-fall through Belling some of tha Loar. Stack. PRINCIPAL T5HM5 07 LOAM STOCK The principal terms of the Loan Stock are set out in Appendix (1). COMPANY POLICY TO W A R D LOAN STOCK It is likely that it will be Company Policy not to redeem Loan Stock until tha redemption date of 1995. However it is likely that the company would issue redemption notice in tha circumstance where it foresaw a slide in share price either due to sluggish trading conditions or an impending recession or a prospective slide in Stock Market indices. . It would do this in order to trigger conversion and thereby maximise -its equity base and its safety net in anticipation of the possibility of more difficult times ahead. In order to be in a position to issue redemption notice at any time it will "be company policy also to maintain a sufficient surplus of cash to be in a position to finance redemption should all Loan Stock holders opt for redemption rather than conversion. ATTRACTIONS 01 H O L D I N G LOAN STOCIC (i) Its capacity to service debt is much higher than in the case of ordinary shares. (ii) The risk is lower. (a) In particular the following can be said:- Tha likely company policy as described under (7) aBove means that if more difficult times were foreseen the prospect for the holders of Loan Stock would be that he would be able to convert and sell at a price higher than tha redemption, price or at worst would be able to secure the redemption price. (b) ■ ■Tha Loan 3.:ccic in this case would be redeemable at i i , 137a which vould be £.277a in excess of his bo crowiag3. (iii) All of tha above attractions are available without sacrifice to tha prospect of tha Capital Appreciation applicable to ordinary shares. i (iv) Tha above attractions are also available without a relative sacrifice of liquidity. Because over 70% of Crean shareholders ara institutional and because Loan Stock, may be converted to ordinary shares at any time from June 1988 it is the opinion of our Brokers j J fi E Davy, that there would be a ready market for significant blocks of Loan Stock at short notice. (v) Blocks of Loan Stock could be sold without disturbing the ordinary share market and this would be particularly important. IMPACT OF ACQUISITION OM CHEAM 9.1 Balance Sheet Assumptions (i) (ii) " <>c >X £ £ £ 130,000 (GBM) 55/324 ( . 10/357 ( • XV £ 156/576 v e x £ 4/410 v y stcr.e £ Stg.E 200/196 35/000 ( 35/000 ( Stg.E 140/000 V ; * F. M cN am ee £ 308,343 Stg.£1,250,576 £ £ ) / 50/000 (As Guarantor for various facilities) 25/496 % M c/0 * Mr J. D. Traynor, 42 Fitzwilliam Square, Dublin 2. Dear Des, I enclose updated Schedule of balances as at 31st March 1991. . Tours sincerely, Martin Lanigan-0'Keeffe. Enc. • •‘ gWCL0SU(ti?~ : p w m cgg s /wait, M t ME., 3 1 -3 .9 1 ■ X/Oc U / h e a . ' Letter of Credit Facility £100,000 £100,000 x x ^ £17,657 £STG 70,000 y^X £131,100 (GBM) £107,181 (JT Senior) XX £315,497 £5,220 £50,000-(As Guarantor) p y r W w - fin XXx X T K y 'xxx HLOK/rahc 8.4.91 £237,907 £STC 35,000 (AORH) £STG 35,000 (KP II) P’. l ' l TO: 014122708 ftyhajla TtttRanpafts TWapliOM(042) 9338451 ta(M2) 9339*70 O w tt ■mat www.Mfittan Co.Louth M r. P .O . M cN am ee, ■‘C noc*, ftsv en sd a le, DUNDALK, C o . L o u th . 19 July 2 0 0 0 MCAnc ' i I- D ear Paddy, ............. I teS er to your enquiry fo r underlying docum entation la relation to the paym ents o f £ 4 0 ,0 0 0 and £ 3 0 ,0 0 0 in 1985. U nfortunately, a s th ese paym ents w ere m ade over IS years a g o m o st o f our records n o lon ger e x is t In resp ect o f a paym ent o f £ 5 0 ,0 0 0 the account fram w hich It w u paid u unclear. W e b elie v e th a t £ 5 0 ,0 0 0 w as paid to you tow ards d ie end o f 1985. ^ " W e en clo se a bank statem ent In resp ect o f a Com pany account at A IB . T he actu al entry Is som ew hat fed ed , but you w ill se e on th e bank statem ent that th e n is a d eb it fo r £ 4 0 ,0 0 0 on the 14 M ay 1985. The B ank h av e n ot b een ab le to trace the paid cheque. W h ile w e can n ot b e ab solu tely certain on the point, it is our b e lie f that this is the £ 4 0 ,0 0 0 w hich w a s paid to you . Y ours sin cerely, F Y F F E S p ic M ich ael C leriria D irector o f Personnel 0 n c » x N V M c C » (O < > a m 4 CFMcCm D V k M M MUmm MB* #Shm* UliqM JFflwtiOSoaltH EXECUTIVE DIRECTORS MWcmir. NO. 23 5TH JULY PRESENT: 1988 M.J.P. - CO'C. - A.J.0'0. - M.L-0'K. THE MINUTES OF THE EXECUTIVE DIRECTORS MEETING HELD ON AM m e t 1988 WERE APPROVED AND SIGNED. }*» S m j C 802/1455 ' NEW FACILITY US)1,000,000 - Tam Loan. NEW FACILITY 803/1456 £40,000 - Loan. 804/1457 EXTENSION £189,000 ■ Loan (BH) £ 15,000 - Loan (No2) £ 40,000 (from £175,000) (BCL), 805/1450 US$115,000 (pravloualjr (135,000) - Loan 806/1459 EXTENSION/REDUCTION £50,000 jrrom £115,000) - Loan BH. £30,000 (from £80,000) - Loan BCL. 807/1460 ADDITIONAL FACILITY £61,033 - Loan BH . £20,000 - Loan No.2 £15,000 (additional) - Loan BCL. 808/1461 HENRY J. MCNAMEE / EXTENSION/REDUCTION £18,000 {phi* Interaw) - Loan. 809/1463 MRS. VERONICA LAVELLE / EXTENSION/REDCUTION £20,000 (plua Interest) - Loan. 810/1483 p i . MARY MCNAMEE / EXTENSION/REDUCTION £18,500 (plus Interest) - Loan IAMES G. MCNAMEE / EXTENSION/REDUCTION £17,500 (plua Interact) • Loan. - BU OC NAME: HENRY J. McNAMEE. AOOHESS: c/o. BUSINESS/ 64, Merrlon Road, Crailt MamotMicrum Submlltid by: . Dublin 4. Equity Slaka: C.B. Approval! Son of Mr. P. C. Me Names Managing Dlractor oF P.M. Fyffes Pic OCCUPATION: PO'D. NO Yn/No Pirmlitkxi OfeUlnud . N/A. THIS APPLICATION: r f » K ^ X 9 e f l 6 K ^ X I O t K X 5 « f l » » ( / / flectio n fOtlwtiuiippraprlX*) TYPE: Lo,n ____ ..___ ___ ■ •gufatlng.tirllfflsi nwrtmrt AMOUNT: JU&flflfl.----------— BATE: .C0Bt-0r.JM.ir- FEE:------- VJL ;______________ J ia s x s s tM ia __ -JL f*:____ . ____ .___________ js!.teLup.j«six_. ------------------- JLMsjflfchfc).----- ------------- “ ____________ If rttwor IncfMwri fadlWn, h drawdown parmflMi prior Id compltllon ol •Murftyi’ PURPOSE/DRAWDOWN: Originally advanced during 1987 to assist In tho purchase of ' sF.^I. Fyffes Pie. Shares. YES/NO REVIEW DATES: TEftM OF FACILITIES: Extension 30th. June, 1989 required for one rear SOURCE OP REPAYMENT! Sale of Shares If additional or ndftlnf SECURITY: taWtv. Ii fMUrlty In ordar? 30,000 Shares In F.LI. F rffw Pic. In the name of Mara Nominees Limited. Power of Sale Form hold. Guarantee signed by P. G. McNamee ( who Is eleo liable on guarantees to a total of £104,000 for other Independently secured account ) YES/NO It No, jfca M u ll aaparaloly. BACKGROUNDNOTE/ ^jpUTUNE OF PROPOSAL: 1* rhe applicant Is a son or Mr. P. G. McNamae (guarantor). Managing Director of F.I.L Fyftea Pic. G&M nave a very long standing relationship with the company for tha past 10/12 years. The guarantee given may be taken as adequate to the extent or £50,000. Hie value of the security held amounts to 245,000. Extension Is recommended. ‘ fan&t____________ _________ CRBDIT COMMITTEE "rtn»(«l PfcUltln/Bmrowtn: (Balanea or Limn, whlehwrar k gnanr) (To Guarantor: £120,000). 170,000 FJ.L • 1.40 • £238,000 . Adequacy • of Guarantor £ 80,000 £288,000 : Cover 2 * 4 .Times. Total Exposure £16,000 N.W Llm'ltl) Rwsor w i in m m » in m w « w « « » W IK M H IM M M H N W l num fn incngmi runposE/ORA«n>owN: * : hdtltlu, b drawdown ^ 'Y W jia H y advanced November 1907 to assist In tha purchase of “ ! ‘ ; Fyfres Pic. Shares, awmltlad prior M •ompfotlon of nourity? N/A4 \ t REVIEW0ATM: TEAM OF FACILITIES: Extension For One Year. 90/8/1909. . . SQUItCBOP REPAYMENT: Sals of Shares. IIiWtlfciiwIar «Khtfn» KCUfllTY: facility. laMMrtiy In ord»r? 33,000 Share* In F.I.I Fyirea hi the name of Mara Nominee* Limited Power of Sale Form held, guarantee signed by P.G. McNamee (who ' YU/MO U alto liable on guarantee* to a total or EI00.000 Tor other Independently secured accounts). IINo, glv«d M h I BACKOnOUMDNOTE/ ■ OUJTLfNE of morosAU V.V The guarantee !ven may be taken as adequate to the extent of £80,000. The value of the shares held amounts to £52,900. Account always conducted In order., Recommend Extension. CniDfT CQMMITTtfl rbltfMlFMUMMOoirewwi: IIMim i or Umlt,wM«lwvw Ii graaurl (To Guarantor: £120,000). 170,000 F.L1. Adequacy • 1.40 - of Guarantor £238,000 £ 80,000 RKorniMndtd BOAF1D Mlnul*..... SStfH..-----Nw» I ImttiO flivtnrilMt hv*................... ....... . Apnrmmt , r NAME: Cridll Mmoumtan SwbmUwi by: MS. MARY McNAMEE . ADDRESS: SUSftffiSS/ OCCUPATION: c/o. 64, Merrlon Road, Dublin 4. Equity St«kr. Daughter of P. C. McNwnee, M.D. F.U. Fyffes Pic. C.B. Approval: Yn/Ne Pwmlnkin Obtained Dim: N/A. THISAPPLICATION: TYPE: Loan NO / ".ducHon IDthMMWrvrArttJ ____ _____ PCD. ‘ AMOUNT! .JUftuHHL----------- - RATB: ..CaSt.flf------ PBE: -N il- rolled up every MtMIHWatMMilHMIMUWM1 6 Month*). PURPOSE/DRAWDOWN: If n«» or intfMMd . ImUMm. b d^wdew* ptrmllted urtor to oompfotlon at McurhyT Originally advanced during 1987 to assist In the purchase of i_ FJ.I. Fyffes Pic. Shares. N/A. REVIEWOATES: TERMOF FACILITIES; . 30th. June, 1099. Extension required for one year. SOURCEOP REPAYMENT: Sale of Shares. If additional or milting (Mfflty, li iMUrity Inocdar7 SECURITY: 37,000 (haras In F.L1. Fyffes In the name of Mara Nominees Ltd. - Power or Sale Form held guarantee singed by P. G, MoNemee (who Is also Uable on guarantees to a total of £101,500 for other Independently secured iceiOnts.) . YES/NO If No, (to drtalb npantaiy. BACKGROUNDNOTE/ «UTUNi OF PROPOSAL: The applicant Is a dauglitar of Mr. P. G. Me Names (guarantor) Managing ' .>* Director of F.l.f. Fyffes Pic. G&M have a very long standing relationship V#lth the company for the pest 10/13 years. The guarantee given may be taken as adequate to ' the extent of £80,000. The value of the security held amounts to £88,500. Extension Is recommended. CREDITCOMMITTEE •nvfirtad faWllwWu wii: (Butane* or UmH,whieh«*f h arwtw! (To Guarantor: £120,000). 170,000 F.1.1. • 1.40 Adequoy or Guarantor Tottl Expaura: £18,500. N«wLlnillb) ntcankd by:....—• «m> £238,000 £ 90,000 £266,000 Cover ZH Tinm i. Oal*:. _fifikl.. .t— A-JslL Racommandrt BOARD _____ £l,^.sj3r0.... Omill M»mmmukiin SutMnltl«il liy: Namr: James (I. Mr.Nnmcc AOnneSS: c/0 64 Morrlnn Rond, Dublin 4 mJSWESR/ Son or Patrick McNamee, M.T). or Fll FyHes Pic occupation: •.JIIIS ATTUICAHOM: ■ ei iil(/Si»fci>: .. i’inmi . a uni m t. ?!?>!!??__ 'nmuhmnummamiamx*x itatB: Ccwl nf § m.f. <2% ( Interest to be yollbd up every - N” Yus/No Pmmillion Oltlllnml M/A C.B.Apimwil! (I)*!**a iim . Lonn ___ 1087 lo Nil ■ If nownr In w fil iMlHtiat, tortnwnlown pnrmln«l »l. o f r.1.1. Fyffes Pic. THIS APPLICATION: p n ’rv Equity Stake C.S. Approval: Yw/No rtrmhikmObtafcwd . Oat*: ' fcttwtan /.Bwfatfton lOwbrt ** vp rvp rirtti HATE: ~Co££-or~.~*<~»... FIH: t1 i 1 t i ! i 1 1 ! I 1 ! i i S I rolled up every 8 monthis). 1 6 m .f. + 2 % (Interest to be i X AMOUNT: i *I TYPE:.... ^fyMMi.-inTvi, ............ 'Exlitfrifl beilhiai wnrlnf i NAME; If rwm or InmmmS fadlWw, bdrawdown parmftMl prior to eomplatian of weurity? PURPOSE/DRAWDOWN: . Originally advanced during 1987 to assist In the purchase L ^ . o f F .I.L Fyffea Pic. Shares. YES/NO REVIEW DATES: TERM OP PAOLITIESj Extension required for one year. 30th. June, IM S . SOURCE OP REPAYMENT: Sala o f Shares. If additional or mbtlng fwWty, kMoartty In anhr? SECURITY: 33,500 shares In FJ.U Fyffes Pic. In the name o f Mars Nominees Lim ited w ith Power o f Sale Form. Guarantee signed by P.G. Mc.Namee ( who Is also liable for guarantees to a to tal of £72,000 for other Independently secured loan*. ye s / nk k II No, M dttalli wparauly. BACKGROUND NOTE/ OUTLINE OF PROPOSAL: • .T h e applicant U a daughter o f Mr, P. G. McNamee (guarantor), Managing D irector o f F.LJ. Fyfres, G&M have a vary long standing relationship with tha company fo r the past 10/12 y e a n . The guarantee given may be taken aa adequate to the extent o f £90,000. The value o f the security held amounts to £S0,2S0. Extension la recommanded. CREDITCOMMITTte ._4l»t«d Facnitta/Borrowarc , (Balinc* or Limit, whtchn« It grtitar) £120,000) ( To Guarantor: 170,000 F.I.I. Shares • HOp .Adequacy of Guarantor Total Expoiur*: £50,250. ' ■ £238,000 £ S0.C00 £288,000 Cover 2 * 4 .........- Time*. lw ~ ^ z Racomm«ml«f BOARD SU___ p-XjbJS*...... - Mlnut*.... Aiwwowirf , DILLON E O S T M Our Ref NL/MMcG/MCN03/l Your Ref C/M 12 Private and Confidential T h e Inspectors to Ansbacher ( C a y m a n ) Ltd. 3 rd Floor Trident H o u s e Blackrock C O DUBLIN Re: Patrick McNamee. D e a r Sirs, W e refer to your letters of 3rd and 2 1 s' D e c e m b e r and in particular the enclosure entitled "Inspectors' Preliminary /^Conclusions". A t paragraph 4 of your letter of 3 rd D e c e mb er , y o u purport to arrive at the preliminary conclusion that M r M c N a m e e w a s a client of Ansbacher. W e reject this conclusion as being totally against the evidence. T h e evidence clearly established that M r M c N a m e e w a s a client of Guinness & M a h o n (Ireland) Ltd. (GMI). ( Yo u r d o c u m e n t contains n o definition of the term "client". Presumably this w a s deliberate, as under n o circumstances could M r M c N a m e e be regarded as a client of Ansbacher in either of the senses of the term used in the Ox fo rd English Dictionary, i.e. (1) a person w h o uses the services of a professional person or (2) a customer. Y o u as m u c h as acknowledge this at paragraph 3 w h e r e y o u state - "although he did not himself open the account in Ansbacher"-). W h a t the evidence further establishes is that G M I , without M r M c N a m e e ' s knowledge, probably channelled £50,000.00 of M r M c N a m e e ' s m o n e y through Ansbacher and designated it as a "back to back" security for M r M c N a m e e ' s guarantee of loans to m e m b e r s of his family for the purchase of shares. Again, this is partially acknowledged at paragraph 2 of your document. A s appears f r o m the documentation, these loans w er e fully secured b y deposits of the relevant Share Certificates. Grand Canal House, 1 Upper Grand Canal Street, Dublin A, Ireland. Telephone +353-1 -66 700 22 Fax +353-1 -66 700 -42 E-mail info@dilloneustace. ie www.dilloneustace.ie Andrew Bates, Paul M. Breen, Mary A. Canning, Kieran Cowhey, David Dillon, John Doyle, Paul Eustace, Paul A. Gill, Paula Kelleher, Brian Kelliher, Lorna Kennedy, Patrick J. Kevans, Denise Kinsella, Catherine McKnight, Mark Thorne, Lorcan Tiernan. Consultant: Fiona Mulcahy. In alliance with ARENDT & MEDERNACH Luxembourg DILLON E y i m C E It is clear f r o m a comparison of the G M I internal documentation o n the one hand and the correspondence between G M I and the M c N a m e e family o n the other, that the only security referred to in the latter w a s the deposit of Share Certificates. A s s u m i n g your convenient definition of "adequately secured" is correct, w e submit that the only conclusion that the evidence adduced reasonably permits is as follows M r M c N a m e e w a s a long standing although small client of G M I . -Without his knowledge, G M I placed £50,000.00 of his funds with Ansbacher and used s a m e as security for M r M c N a m e e ' s guarantee of loans b y G M I to m e m b e r s of his family and a staff m e m b e r . These loans w e r e for the purchase of shares in Fyffes Pic and w e r e already secured b y the deposit of the relevant Share Certificates. W e therefore submit that your d o c u m e n t be a m e n d e d in the following tw o respects:- (1) T h e inclusion of a clear definition of the term "client" and (2) T h e adoption of the conclusion w hi c h w e set out above. W e look forward to hearing f r o m you. Y o u r s faithfully A M e — Dillon Eustace "■ THE HIGH COURT I N T H E M A T T E R O F T H E C O M P A N I E S A C T S 1963 to 1990 A N D I N T H E M A T T E R O F P A R T II O F T H E C O M P A N I E S A C T 1990 A N D S E C T I O N S 8 A N D 17 A N D IN T H E M A T T E R O F A N S B A C H E R ( C A Y M A N ) L I M I T E D (formerly G U I N N E S S M A H O N C A Y M A N T R U S T L I M I T E D , A N S B A C H E R L I M I T E D and C A Y M A N I N T E R N A T I O N A L B A N K A N D T R U S T C O M P A N Y LIMITED) R e p o r t A p p o i n t e d A ffairs o f o f t o t h e In s p e c t o r s E n q u i r e A n s b a c h e r i n t o t h e ( C a y m a n ) L i mited Published by Order of the Court made on 24 June 2002 V o l u m e [9 ]: A p p e n d i x X V ( 8 1 ) t o X V ( 9 5 ) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (81) Ms Susan Sheridan Mack 1. E vi dence relied u p o n b y the Inspectors in arriving at the conclusion relating to M s S u s an Sheridan M a c k . a) Letter o f 19 M a y 1 9 9 2 - J D Traynor to A n s b a c h e r Limited. b) Letter of 14 D e c e m b e r 1 9 92 - Ha m i l t o n R o s s & C o to IIB. c) Letter o f 4 M a r c h 1993 - J D Traynor to Sus a n Sheridan M a c k . d) Letter o f 2 7 January 1 9 9 4 - H a m i l t o n R o s s & C o to IIB. e) Letter o f 1 February 1 99 4 - J D Traynor to S u s a n Sheridan M a c k . f) Letter o f 2 5 October 19 94 - H am i l t o n R o s s & C o to IIB. g) IIB statement re H a m i l t o n R o s s & C o o f 31 M a r c h 1994. h) Letter o f 10 M a r c h 1 9 97 - H a m i l t o n R o s s & C o to IIB. i) Letter o f 2 8 January 2 0 0 2 - G i b b s & M c C u r l e y to Inspectors. 42FTTZW1LUmi« DUBLIN 2. TAmUMOOM Fax:612080 fa c sh h m •• To? . ta a b a c h a rL im ita d . it t n t la n i H at N r. M. b a y . to a h s m ib s ic w . . . _2S5JB2s. ■ 001 809 9495267 1 9 th M ay, 1992. HAKttTON ROSS QBP08XT ACCOPMT 38H T h is C lia n t haa ta la p h o n ad lo o k in g fo r soua fu n d *. Sha would li k a t o hava fcfaraa chaguaa p la a a a aaeh patyabla to h e r s a lf - Snaan S h e rid a n Mack - ona fo r 0 8 $ 4 ,0 0 0 .0 0 and th a o th a r two f o r U S $3,000.0 0 aaoh (T o ta l U S $ 1 0 ,0 0 0 ). Could you p la a a a a rra n g e to sand th aaa th ra a chaquaa to h a r a t h e r addraaa i a F lo r id a which ia . ‘ 5959 Bayviaw C ir e la S outh , GOLFPOBT, . F lo r id a 33707, - 0. S. A. X t you have a p ro b lo a , p la a a a a d v ia a . R agaxda, - J .D . T ra y n o r. JDT/AJW • - • Pleata reply to: 42FifcreOHsmSquire, p.o. Biw mn.anwi c w m . c*jm«i m * . • iWiplwwnonWMMS Tetatcy^juj Dublin 2. RustoiBo: (*#) 949-7946. <*») 949-3267 TM.-765WV7S3065 - - Rue 612035 14th December, 1992. Koran Redeond, Baq., . Corporate Services, Xriah Interoontineata1 lank Limited, 91. iMsrlon Square, PMfflJL. Dear Sonan, . - I confirm having requested you th i* eornlng to open • nfw ., u .s . D o lla r Account in the m m ot Hamilton t a i l Co. U n ite d K ef.'A /A 56 and you hava allo cated tho number 03/39317/01 to th is Account. Ka w ill bo having a tra n a fe r sad* sh o rtly v ia Kradiatbank Row York fo r t h ir Account and w ill adviaa you o f tha amount whan va know tha fund* ara an ro u te. -V : I O!' Could you alao pleas* arrange to open two mora Deposit Aocounta in tha iuum of Hamilton Kbaa Co. United - 0.6. Dollar* ■ with reference* A/A57 and A/AS8. Two Deposit* ara dua to aatora on 4th January and at Maturity we will be making arrangement* to hava theM transferred via Xrodietbank Haw.York to you. for credit to the**' two new Account*. In diia oourse please advise tha number* allocated and wa will of oourse let you know.tha amount*' bain? transferred whan wa have bean advised. ; Yours sincerely, M r HAMILTOW BOSS 00, m iS S S £ R t« . Soma ttMKlOan Made* 5959 B iorvlw C ls o l* _Sooth, G o u m tn , s . ... Florida: .33707,;.,....... .. l..' ‘ * DMZ M rs. Mack, %» t w xodoruint *ft«fc- to * w tlo a o f. t * . *bov«; i'-iM $112>972»1^» ^iWLn •■ • ': 27th Jamas?' 1994 Ronan Radaood, Saq., Corpora):* ■ JarylOaa;•4' l ^ ^ pt e t w poB t l ^ t a ^ Bank, .U a lta d V '-' • ni:ai.IR , T l. D*ar Sonan, • • , .u r. s D®ar1Ronan,-'S>2 5'‘arew" " - * .jj i r . 9" . '>c . ooIU* fchi • ^ * ^S . • ' C onld yon p la a a * ' fi& a a ja t o l e t a s hava f o r o o lla a tia n . th ie a a ^ 0 .8 . D o lla r dhaqnaa aach p a y a b la v ttf MHS. SOSAW S S q K U U r-ia c x and aach is th a 'a ta ri o f '0 8 *3 ,0 0 0 .0 0 . ' .. SOaaaa dabi* al^thr#*; to'-ftaidlW*1Sosa o'.S* Hollar Account Mo* 0 3 /3 9 3 7 3 /8 1 . Tours ia la c a ra l'y ^ rc ! V < $3 I. . I. an 7 Appendix: P.O. Box 887, Grand Cayman, Cayman Islands, Biitfib West lndiss Telephone: (809)949-8633 Telex: CP4303 Facsimile: (809) 949-7946, (809) 949-3267 42 F&zwBliamSquare, Dublin 2. TH: 676 5144*76 3065 Fb : 6612035 ' 25th October, 1994. M&DaireNota-Caasidy, Corporate Services, Ifjfh B«A T 91 Mental Square, ■DUBLIN2. • DearDaiie, • ...«•*■ ‘ «* ' ... . ’ Could you ptatto arrange to tot u»hiv» fig coUccdon throe U.S. Dollar cheqocs each in the sum ofUS$3,000.00 and each payable to SUSAN SHERIDAN-MACK. . Please debit tl» roat to HamiltonRoss TJ.S. Dollar Account Re£ A/A58 No.03/39273/81.' Youmsincerely, . • j-V .\ , ynrHAKm .TnNTttOSS flfL LIM ITED . r. ZAffi r' \ STATEMENT HAtULIUH MUM CU-U (JREF.A/A5t*f?W.«• c/o coKpoRAre seiwices •* >: ATTN NR ROMAN REOHOND • ' . IkBHinilCONnNHOTALBAiarXOT!: • jDM 3' .; ' *• TrK ••• 9ttoataiS*K» . 1 U « h a N E 0 » ) 09744 “■ A/Cl 03/39273/S1 USD . OCR CL DEN NON RES ' ORAL* ■ '■ • • E8FEB94 BR0U6HT FORWARD 07MAR94 NEW CR RATE' 3.23000000 14HAR94 NEV CR RATE 3.0*000000 NEW CR RATE 3.2SS60000 c. • 21HAR94 Z8MAR94 NEW CR RATE 3.37SOOOOO 31HAR94 INTEREST TO 31NAR94 .... . ^ : l 1 ! i * S.C.M. VMM . MTI 07HAR94 14MAR94 21HAR94 26HAR94 31HAR94 mnt • •, * , • ... • ■ I MTI i• WW !£ ■ PA6E *010013 i• i0 !£ .31HAR94 . . ! j <■ i CMCCT ’ fif^ffTT . ‘ .» * ».». •■ 2*6/133.96 { . 2*6,153.96 * 2*6/133.96 206,135.96 v -■ 266,135.96 * J■I .I 3*167.44 ... 209,323.40 “ V X ■. . V. ' i*. • I s * • V *s : i. c C' c c '■I 8 InnsCoot W n e ta ie m Street. Dublin8. p.0 box 887, GrandCayman, Cayaaa Uudh Bdtbh W at Indict Tbteptnae: (809)9494633 1UasCP430S FactimOB:(809)949-7946, (809)949-3267 '’J.V '•ft* *-I# M 10tk March 1997 ■ &r* VvT? fo .• Ms. Panla Hartnett TriAfaicrcantincatal Bank 91 Macias Square ; DabSn2 . •I'.•* •I•S i: *• v .]■ Dear Paula *v%<’* .\'3 Fleaso arrange to 1st mo have throoUS Dolla^ dxafli each in the «uia o f USS 3,000.00 payable to Ms. Sum SheddaeMacdc. . . Please ddntthe coat to 03/39Z73/*l.:r Yours sincerely .1 . ■ ' • ! I G ib b s & M c C urley , r a . A tto rn e y s A t U w 100 Second Avenue South, Suite 704-S St. Petersburg, Florida 33701 Telephone (727) 892-6001 Facsimile (727) 892.6002 MW M 2 January 28, 2002 His Honour Judge Sean O’Leary Ms. Noreen Mackey B.L. Mr. Paul Rowan FCA Mr. Michael Cush S.C. Re: Ms. Susan Sheridan Mack Dear Sirs and Madams: Reference is made to your correspondence of December 17, 2001 affording Ms. Sheridan Mack an opportunity to provide you with a written reply to the preliminary conclusions reached by you relating to Ansbacher. Please be advised that Ms. Mack has retained the undersigned to represent her with respect to this matter. As you may or not be aware, Ms. Mack’s father, John D. Sheridan died in January, 1983. Subsequently, in 1985 Ms. Mack first heard of Ansbacher and began receiving distributions. Ms. Mack has no idea how she acquired her interest, but presumed that it was inherited from her father. Please understand that Ms. Mack is never considered herself a “client" of Ansbacher and still does not do so. Again, she has little knowledge of the investment and still assumed that it was inherited. If we can be of any further service to you please contact the undersigned. Sincerely, GIBBS & McCURLEY, P.A. BGG/klk Appendix XV (82) Ms Mary Maher (nee Lynam) 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Mary Maher (nee Lynam) a) Unsworn statement of Mr Edward Lynam dated 23 June 2000. b) Letter of 22 June 2001 - LK Shields Solicitors to Solicitor to the Inspectors. Correspondence received from or on behalf of Ms Mary Maher (nee Lynam). a) Letter of 21 August 2001 - LK Shields Solicitors to Inspectors. b) Letter of 21 August 2001 - LK Shields Solicitors to Inspectors. c) Letter of 17 September 2001 - LK Shields Solicitors to Inspectors. d) Letter of 26 October 2001 - LK Shields Solicitors to Inspectors. REVISED UNSWORN STATEMENT OF EDDIE LYNAM . I, Eddie Lynam, make this statement supplemental to my unsworn Statement of 23rd March, 2000. I should mention that I was asked on 23rd March, 2000 by the Honourable Mr. Justice Costello to ascertain whether I had any further documentation, including any trust documentation or letters of wishes. When I met with the Inspectors on 23rd March, 2000 I furnished to them all documentation which was within my possession, power or procurement at that time. Subsequent to my meeting with the Inspectors, I earned out a further search of my house (having previously carried out thorough searches at my home) and I uncovered further documentation that I had not beau aware of prior to the meeting. I enclose further copy bank statements from Ansbacher (Cayman) Limited. As you previously indicated to me by letter dated 23rd December, 1999 that you have no interest in financial details, I have accordingly been advised by my Solicitors that it is appropriate for me to delete such details. I have also uncovered two letters of wishes, one dated 3rd September, 1981, the other dated 5th March, 1987. In February, 19941 instructed Mr Des Traynor to transfer my account into the names of my son and daughter, Bryan Lynam and Mary Lynam, for convenience purposes only. My children were aware that the beneficial interest in the monies would remain with me. I also enclose herewith further correspondence received by me from Mr Padraig Colleiy, Ms Joan Williams and Mr Des Traynor which I discovered as a result of my recent search. It would also appear from the documentation enclosed herewith that on certain occasions where Mr Des Traynor was unable to contact me (to receive instructions), the deposit was “rolled over'*, by Ansbacher (Cayman) Limited, on his instructions. I can now also confirm that the joint-account which I held with my brother was split in approximately March, 1987. This is evidenced by a letter from Mr Des Traynor. On 23rd Match, 20001 was under the mistaken belief that at no stage did I transfer any funds to an account in the Isle of Man. It would appear from the documentation enclosed herewith (that I have recently discovered) that monies were transferred to Ulster Bank, Isle of Man, by Mr Des Traynor, on my instructions. I apologise for any confusion that might have been caused in this regard. Without the benefit of this information I would not have been in a position to confirm that I gave these instructions to Mr. Des Traynor. instructions to Mr. Des Traynor. I still have no recollection of giving these _. As you are aware, I wrote to Mr Padraig Collery asking him to furnish to me any documentation that he might have had in relation to my account. I also wrote to Ansbacher (Cayman) Limited and Mr. Cathal Mac Carthy of Guinness Mahon (Ireland) limited. I have not received &reply from any of these parties. (1477A)01EC/DOCS/STATE2.DOC) SOLICITORS Ms. Mary Cummins, Solicitor to the Inspectors, 3rd Floor, Trident House, Blackrock, Co. Dublin ou» Rn 1477-001/LKS/EC/010612L2 You* i n C/L06/MLC/mf 22u June, 2001 Re: Oar Client: Edward P. Lynam Mu nt Dear Ms. Cummins, We refer to your letter of 12* inst, Our client instructs us to respond to your letter as foHows:Regarding paragraphs 1 and 2 As you are aware, our client instructed Mr Desmond Traynor to transferbis account held with Ansbacher (Cayman) Limited ('‘Ansbacher”) to the names of his son and daughter, Biyan Lynam and Mary Lynam. Our client gave this instruction to Mr Traynor for convenience purposes only (our client retaining the beneficial interest in the monies), however, our client is not sure whether he communicated this specific fact to Mr Traynor. Our client instructs us that after receiving Mr Traynor’s reply of 7*b March, 1994, our client received no further correspondence from Mr TVaynor or Mr Collery to the best of his knowledge and that any other correspondence relating to this account was sent to Ms Mary Lynam. Our client understands that Ms. Mary Lynam and Mr Bryan Lynam wrote to Mr Collery by letter dated 22nd February, 1995 on our client’s instructions and instructed him to transfer the fluids held with Ansbacher to an account in Ulster Bank (Isle of Man) Limited. This letter also sought confirmation that the account with Ansbacher had been closed. Regarding Paragraph 3 '■ . As previously advised, our client instructs us that to the best of his knowledge no lodgments were made to the account held by him with Ansbacher after the initial lodgment. The correspondence referred to in your letter under reply refers to tiie bank account being “rolled over” on a periodic basis. We trust this letter clarifies your queries. YoMrc ♦fu'thFuMw L K SHIELDS. SOLICITORS. , SOLICITORS 39/40 U pper M ount Street D ublin 2,Ireland. His Honour Judge Sean O'Leary, Ms. Noreen Mackey B.L., Mr Paul Rowan F.C.A. & Mr Michael Cush S.C., Joint-Inspectors, Third Floor, Trident House, Blackrock, Co. Dublin Telephone:353+1 661 0866 Facsimile: 353+1 661 0883 D.D.E. Box No: 123 E-Mail:email@lkshields.ie W ebsite:http://www.lkshields.ie 1477-001/EC/BMG/011023L3 YourRef: 06/N cPM 26th October, 2001 Re: Our Client: Ms. Mary Maher Dear Sirs/Madam, We refer to your letter of 11th October, 2001, the contents of which we have noted. We assume that your preliminary conclusion that our client was a “client of Ansbacher” (which you have not defined, despite our requests) was determined on the basis of the existence of our client’s name as a signatory on the account and letters signed by her and not on any consideration of the beneficial ownership of the account. If so, it seems to us that you have attached a meaning to the concept of “client” which is strained and quite simply wrong and results in a serious injustice to our client. We do not accept that your terms of reference entitle you to resolve disputed issues as to the meaning of this term. Your function is, inter alia, to identify persons falling into a certain category and not to reach conclusions of law as to the meaning of that category. If there is doubt, it should be resolved by the court before our client’s good name is impugned. iZ**' In the event that you are of the view that our assumption is incorrect and you consider the issue of beneficial ownership to be relevant to forming your preliminary conclusions then we invite you to call our client to an interview with you on the usual involuntary basis. Finally, we note that your letter under reply was not signed by Mr Michael Cush, S.C. Yours faithfully, L K SH IE LDS,SOLICITORS LAURENCF.K.SHIELDS,EDMUNDBUTLER.PATRICIAMcGOVERN,HUCHGARVEY,JOSEPHM.GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTINMcKENNA,MICHAELKAVANACH,EUGENEFANNING,DAVIDJ.H.WILLIAMS,FIONATHORNTON,NICOLAPALMER, AOIFEBRADLEY,STEPHENBRENNAN,SIOBHANBUCKLEY,PAULABURKE,EOINCUNNEEN,PHILIPDALY.PATFOX,MARCOW.HICKEY,CONORMULLANY,JAMESMeGILLION, N1AMRMcKEON,OKLAJGHO'DWYER,DEIIVALO'HALLORAN,JENNIFERO'NEILL,GARBHANO’ NUALLAIN,CORACRAMPTON{FinancialController).THOMASJACKSON(Consultant). SOLICITORS 39/40 U pper M ount Street D ublin 2, Ireland. T he Inspectors, H is H onour Judge S ean O 'L eary, M s N oreen M ackey B.L., M r Paul R ow an F.C .A ., M r M ichael C ush S.C ., 4th Floor, T rid en t H ouse, B lackrock, C ou n ty D ublin. Re: Telephone:353+1 661 0866 Facsimile: 353+1 661 0883 D.D.E. Box No: 123 E-Mail:email@lkshields.ie W ebsite:http://www.lkshields.ie O ur Ref: 1477-001/LKS/EC/010820L3 Your Ref: 2 1st August, 2001 Our Clients: Mr Bryan Lynam & Ms. Mary Maher Dear Sirs/Madam, We refer to your letters of 31st July, 2001 with enclosures to our clients and are instructed to reply to same. We note that you have formed the preliminary conclusion that our clients were “a client of Ansbacher” and that you have afforded our clients the opportunity to provide you with a written reply to this preliminary conclusion. While it is acknowledged that you have set out the procedures to be followed by the Inspectors at Appendix C to your letters of 31st July, 2001, prior to advising our clients to provide any written response, or indeed any response, we request certain assurances from you. We refer you to the Supreme Court Judgment In the Matter o f National Irish Bank Limited, (unreported, 21st January, 1999), in which Judgment Mr. Justice Barrington stated, inter alia,:“In these circumstances I would uphold the decision o f the learned High Court Judge but would add the statement that a confession o f a Bank Official obtained by the Inspectors as a result o f the exercise by them o f their powers under Section 10 o f the Companies Act, 1990 would not, in general, be admissible at a subsequent criminal trial o f such Officials, unless, in any particular case, the trial Judge was satisfied that the confession was voluntary.'’’ In order to protect the interests o f our clients and to guard against any perception that our clients will voluntarily answer questions, provide information or provide books or documents or information to you as Inspectors (which they will not), we request that you confirm that you accept that any information given, or questions answered, or books or records furnished, by our clients would not be voluntarily given. LAURENCEK.SHIELDS.EDMUNDBUTLER,PATRICIAMtGOVERN,HUGHGARVEY,JOSEPHM.GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTINMcKENNA,MICHAELKAVANACH,EUGENETANNING,DAVIDj.H.WILLIAMS,FIONATHORNTON,NICOLAPALMER. AOIFEBRADLEY.STEPHENBRENNAN,SIOBHANBUCKLEY.PAULABURKE,I'OINCUNNEEN.PHILIPDALY,PATFOX,MARCOW.HICKEY,JANEMEEHAN.CONORMUl.LANY,JAMESMcCILLION, NIAMHM.KEON,ORLAlGIiO'DVYYF.R,DERVALO'HALI.ORAN,JENNIFERO'NEILL,GARBHANO'NUALLAIN,CORACRAMPTON(FinancialController),THOMASJACKSON(Consultant). We look forward to hearing from you. Yours faithfully, SOLICITORS 39/40 U pper M ount Street D ublin 2, Ireland. T h e Jo in t Inspectors, 3rd Floor, T rid en t H ouse, B lackrock, Co. D ublin BY COURIER Telephone:353+1 661 0866 Facsimile: 353+1 661 0883 D.D.E. Box No: 123 E-Mail:email@lkshields.ie W ebsite:http://www.lkshields.ie 1477-001/LKS/EC/010917L1 Your Ref: C/L13/C/M47/MLC/mf 17th September, 2001 re: Mary Maher (nee Lynam) Dear Sirs/Madam, We refer to previous correspondence in relation to our client Mary Maher and to your preliminary conclusions communicated in your letter of the 31st July 2001. Let us firstly put on record our instructions that our client was not at any stage a “client” of Ansbacher and did not at any stage have any beneficial interest in any funds in any Ansbacher account. With reference to the Inspectors’ preliminary conclusions in relation to Mr. Edward Lynam, we note your comment that:"Although Mr. Lynam claims to have retained the beneficial interest in the deposit account, the documents do not support this assertion. ” This, combined with the reference to the change of a name, is an implied finding that our client held a beneficial interest in that account after February 1994. That finding would be immensely damaging to our client’s good name and would reflect a position which is untrue in fact. We believe this to be an unjustified attack on our client’s good name in circumstances where the unchallenged evidence of Edward Lynam is that he was at all times the beneficial owner. Indeed, there is no other evidence as to beneficial ownership of the funds in that account. There is, o f course, evidence as to a change of name of the account but that does not address the issue of beneficial ownership. It is quite wrong to refer to the change of name independently of the true position on beneficial ownership and in a way which creates the misleading impression that our client was a client of Ansbacher. LAURENCEK.SHIELDS,EDMUNDBUTLER,PATRICIAMcGOVERN,HUGHGARVEY,JOSEPHM.GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTINMcKENNA,MICHAELKAVANAGH,EUCENEFANNING,DAVIDJ.H.WILLIAMS,FIONATHORNTON,NICOLAPALMER, AOIFEBRADLEY.STEPHENBRENNAN,SIOBHANBUCKLEY,PAULABURKE,EOINCUNNEEN,PHILIPDALY,PATFOX,MARCOW.HICKEY,JANEMEEHAN,CONORMULLANY,JAMESMcGILLION, NIAMHMcKEON,ORLAIGHO'DWYER,DERVALO'HALLORAN,JENNIFERO'NEILL,GARBHANO'NUALLAIN,CORACRAMPTON(FinancialController).THOMASJACKSON(Consultant). In the light o f your invitation to our client to submit a written statement we now enclose an affidavit sworn by our client setting out the true position on oath. Please note that our client submits this affidavit under compulsion of the process in which the Inspectors are engaged and in that sense, it is not a voluntary statement. However, if you have any doubt as to the veracity of what our client says on oath, we invite you to exercise your powers to require her to attend for cross-examination and confirm that if so required, she will attend. ^ In the circumstances, we request you to alter your conclusions and not include any finding to the effect that Mary Maher enjoyed the use of the funds on deposit and not to include a conclusion that Mary Maher was a “client” of Ansbacher since both of those conclusions would be untrue, unsupported by the evidence and in all the circumstances, an unjustified attack on our client’s good name. Yours faithfully, SOLICITORS 39/40 U pper M ount Street D ublin 2,Ireland. His Honour Judge Sean O'Leary, Ms. Noreen Mackey B.L., Mr Paul Rowan F.C.A. & Mr Michael Cush S.C., Joint- Inspectors, T hird Floor, Trident House, Blackrock, Co. Dublin Telephone:353+1 661 0866 Facsimile: 353+1 661 0883 D.D.E. Box No: 123 E-Mail:email@lkshields.ie W ebsite:http://www.lkshields.ie OURREF: 1477-001/EC/BMG/011023L3 Your Ref: : C/L06/NSPM 26th October, 2001 Re: Our Client: Ms. Mary Maher Dear Sirs/Madam, We refer to your letter of 11th October, 2001, the contents of which we have noted. We assume that your preliminary conclusion that our client was a “client of Ansbacher” (which you have not defined, despite our requests) was determined on the basis of the existence of our client’s name as a signatory on the account and letters signed by her and not on any consideration of the beneficial ownership of the account. If so, it seems to us that you have attached a meaning to the concept of “client” which is strained and quite simply wrong and results in a serious injustice to our client. We do not accept that your terms of reference entitle you to resolve disputed issues as to the meaning of this term. Your function is, inter alia, to identify persons falling into a certain category and not to reach conclusions of law as to the meaning of that category. If there is doubt, it should be resolved by the court before our client’s good name is impugned. i I n the event that you are of the view that our assumption is incorrect and you consider the issue of beneficial ownership to be relevant to forming your preliminary conclusions then we invite you to call our client to an interview with you on the usual involuntary basis. Finally, we note that your letter under reply was not signed by Mr Michael Cush, S.C. Y ours faithfully, L K SHIELDS, SOLICITORS LAURENCF.K.SHIELDS,EDMUNDBUTLER.PATRICIAMcGOVERN,HUCHGARVEY,JOSEPHM.GAVIN,EMMETSCULLY,GERARDHALPENNY, JUSTINMcKENNA,MICHAELKAVANACH,EUGENEFANNING,DAVIDJ.H.WILLIAMS,FIONATHORNTON,NICOLAPALMER, AOIFEBRADLEY,STEPHENBRENNAN,SIOBHANBUCKLEY,PAULABURKE,EOINCUNNEEN,PHILIPDALY.PATFOX,MARCOW.HICKEY,CONORMULLANY,JAMESMeGILLION, N1AMRMcKEON.OKLAJGHO'DWYER,DEIIVALO'HALLORAN,JENNIFERO'NEILL,GARBHANO’ NUALLAIN,CORACRAMPTON{FinancialController).THOMASJACKSON(Consultant). A ppendix XV (83) Sir G eorge M ahon, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Sir George Mahon. a) Letter of 11 November 1977 - George Mahon to Guinness and Mahon. b) Internal Guinness and Mahon memo of 11 May 1976. c) Guinness and Mahon statement re GMCT - a/c A/Q. .. .: . i /->*<■ '«•»" (OI)J«n»« 0BKKN1XCH, ^ ■•«& . < v r ^ 5 - • .-• • .%• £* . ..' < &; Vjrvv <« ‘^)r* J)tA'rSg-M , c W e . - p~v>- 6 . . % YtoteWrtL # *■ {ta t'f& J & U _ :S KNNISKKttKy. V - / - ? * - £ < L > - / * ^t-sve*. ■ ^ “ & 17 e ~ o»»i mium*} ooi no «*n Lumhi M0) » ?;(;> Ot-i/gst IllflillftriZ _ INI N**MN0W OOt•MJtfAll-«i*tiriw -1*111*4 (IN 00* NOUAtl 'MNIirw act? i»nr ti.not nm ot ?'•»**: .ojmimk « m « miioi oot «io) umrti 4*0] UillH lIMXla 001 *109 t/wirtt N>*» ■1IN11IM l*l atl*M*11HI ot mi oiiuirot mii«*m«o) miH»i aoi ut tMnrti OTIl******} 1OH0IH* 001 1*1 «Mnr«l 0Ji***4*O)*l NOHit 0O* Ml U*nr» 4D01NI tll*lM«*I *0)4 001 141 t/Nnm t»<1*«« IHlnaiN 13NV1M ojnarzo ItlOWH *»« itftaiixi *M110» M*n . . •/* «n lffl4l NVNAV9 NUltV*SSlfll li19 aswwww □ **• ‘ aaara -v; W +9 P; A ppendix X V (84) M r A lexander H M ajor 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Alexander H Major. a) Internal Guinness and Mahon memo of 30 December 1982. b) Letter of 14 December 1982 - GMCT to Guinness and Mahon. c) Letter of 8 February 1983 - Guinness and Mahon to Mr. Major. d) Telex of 28 February 1983 - GMCT to Guinness and Mahon. e) Photostats of 4 cheques dated 26 August 1986. Alex Itejorplion^ toHay and informed oe he ms asking arrangement* .. ... with G.M.CiT. to pay Irttireit due 26th November; Checked with M1k» Shields wbo . said he wasunawareof the position. Mike Shields Is to revert. Alex Major has been wad* aware fay.Mike that allposltlons may be 'closed out'. ' No further action necessary at tha moment. .... / V G U I N N E S S M A H O N C A Y M A N T R U S T LI M I T E D A Mambar of the Cutaneaa Mahon M w danl BMMng Group P.O. BoxM T GrandCayman emhVtaa! Indlaa Ttiaphon* No #-4863/4 Tatax CP4305 CablaAMraaa Gufcmaa December 14, 1982 yourMl Guinness 4- Mahon Lim ited 17 Collage Green Dublin 2 P.O. Box 35A Zealand. A ttention* Pat O'Dwver Dear P at, . .................. Rat Alex Malor/fluinness & Mahon L td ./ Prowiaiory Note - US$100,000.00 I an enclosing the algned o rig in a l o f the above Promissory Note fo r your records. • Yours sin cerely, Michael V. Shield. MWS/cp E n c l. ' Amman VJ: •*» ’ ••. •' j .uL.'..- s'. • V fr t *x -• *oC i Mr. 'MwiMhr£. Itojor, 31. Union Squara Ifcst, * Suite ]1300,;,,r New York.10003. U.S.A. •' • ' I -v - vr* Otar Mr. Major, .. : I w it* to edvlsejlwt liiteWMrt dut o n y w r Jour Jecount* as at 2Sth Fttruaiy. 1963 * 11 w w t to U .S .f g ^ .^ PlMM^arra^; to credit our accountat Itemifaeturars g w w T>««t Co«paiv» 4 M«r Toric n « » . Naw York with tht said sun. v#lua Wt > February. 19W. Yours slncaraly, srsnaan DonnaOy. 2 3 2 0 T O : 5 M A R S f f l *I ,% F R . O M G i U r r . V i - 4 £ E J r G U I N H H E W R E N E U R A O F E S I K S / 2 E U M S T O R A O N T H E L O E E A M O D N 10 i / 4 X P T H E I N I L M A H O N D U 2 7 L E O N ' . ’. 3 r 0" * R 0 W Z S A R 3 J I N T E B N D L O E R N T H A T A / C N D U T T H T H I . E A B E E I S S t E O R A i . C O . I M M S i S + M L O N D O N I L A N L B E D I A 0 N W . A / C ' S E R E C T E L Y ' A H T D D B * S T . L I N O L R 8 V E D V t l X T E E P O A C C O O N T H S 8 U N T O I N 6 S T S 2 P E R E 1/tX H E N E E O P E F U H E I V E D E D U I N . , B E P 7 W . B D R W F O 6 I T S H / 3 E R / 8 A L L O W O V E R C O E 3 A N N U M L I N . E I T A / C D A Y 8 O N O C M S E I V L L Y I T H R ' % U U T H I . E E D S T O N . . F T H T H E E 2 X O N O T H E R 2 F 3 / 2 F E C O V E R P / 8 3 T I V E A/C'S C O E D E E E M O N T H O S S T I T F U N D S . • A L O * T R D S M N T H H U E R Y O U R I S . S T T O , D A N . U T H ‘ S H S T R O N 7 T N A N A N T f f E R JO *. & L .E A R N E D I L L E S S S T t f '$ V N E R A H 0 N T R A N S F E R R E D H E i 8 A C A Y M 8 C A Y M V A H O N E - 8 R L D L R 't - V ** H M 3 I E '& F O R H A H O N E D T H ' E S S / 8 8 I S H T E I S 8 r t A J O / ? N N 6 V 1 N N E S 8 + M 2 ^ I N I N E D . E T H T H ' S T I C O E F R O M I S E R N M E M E X F D T U S E R . P O M I T T A N F E U D S L R S I T A A J O R O 2 5 / C , 8 A T H E F U S C E D A Y S . 6 - 5 T 7 G U I N T E U H D 2 I N N E S E S T R S s L R S E N R E C E I V E D ALEXANDER H. MAJOR 30 L IN C O L N P L A Z A NCW YO R K. N Y 10013 t - >31/110 6UINESS+HAH0N LTD -I * 300,000.00 Three.Hundred-Thousand CollarsIj )qZ1QQ= D o 11 a k s USTrost ffl&VSP'™604% m m sinwi v«i»,n y.iooqs for loan dated.. ««Principe]Jg_fyll,,f$ lWl i 5683 5«* ALEXANDER H . MAJOR 3 0 L IN C O L N P L A Z A NBW YORK, N Y August 26 ,«86 10023 oumssmm ltd ->$ 400.000.00 Four Hundred Thousand Dol lars 4 no/100-"—— ----------nn11A„s i r c 'T V t .e * U a ilB S l uM m m m OPMWVOJK tm w t eo. 4t W*(M* PrJncipaT'flT'WlTTor loan dated • -May-10—J983- '•»:oeioDi3iai: . ^ i _ . tT^S 6 i S&a 3 5a* MMrfaaWHaMOUMaMM ALEXANDER H. M AJOR 30 U N C O L N P L A Z A NBW Y O R K , N Y tO O tt 221 . 1-lJt/ttO Sayj* SUIMESS+HAHON LTD $ 23,612.88 Twenty Three Thousand Six Hundred Twelve * 88/100USTVuSt J-aWSJpw-wea 4»»K 8X«W __ IntereslTfnVulfon SI00K loan dated *** 2/22/82 -fronr8/27/84 tj 8/26/86" *i:oaioaiaia«: e>l s&ai s«* 208 ALEXANDER H. M A JOR 31 U N C O L N P L A Z A N E W YO R K , N Y 1009 _.Aag“st__2§_is_81 ««£!!"_ ...GUINISS+MAHON110 _ P rin cip a V ijn*’?ulT°^or Iw n dated February 22, 1982 ■no 2 ioo i a IB*: &i s^a a sw »/m ____________ i s 100,000.00 ....One Hundred-Thousand .Dollars JLnoZlQflb USTrust 8f3Wg?l"J,‘c'* ■***•■■** »4ttjllStraw m r.O O LLAR S A ppendix X V (85) M s Augustina Russek de M alam ud 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Ms Augustina Russek de Malamud. a) Promissory Note in favour of Guinness and Mahon of 5 February 1982. b) Letter of 1 March 1982 - Guinness and Mahon to Isaac Carlos Malamud, Carlos David Malamud & German Malamud. c) Letter of 24 January 1984 - Guinness and Mahon to Carlos D Malamud. d) Internal Guinness and Mahon credit memo of 11 July 1984. e) Internal Guinness and Mahon credit memo of 17 January 1989. * 0*t» : .rafacuaiy.S,.IM 2. PKIHISSORr NOTE Ue, Isaac Carlos Malaeu^/fo'rlos David Malaaud, S*m« Malanud, c/o, Isaac C. Malaiwd < Sons, 4990,'Ht^lon Boulevard, Suita 2, San Delno, Calfornia 92109, U.S.A., hereby Ja&gffft Severally pronfse to pay to Guinness *Mihon. limited of 17, Collej^pi(eit, Oublln 2, Ireland the suni of Five Hundred and Fifty Thousand U&ikd States Dollars (0.S.$550,000.00) together with Interest thereo» at the rata of sixteen percent per annua on the anniversary or drawdown of said sun. • All payments on account of principal and Interest In respect of this loan shall be effectively eade to Sufnnass + Mahon Melted w1,tho^f set-off or counter- _ data, free and clear of, and without deduction.for:o’r on account of, any and all present and future sUitp taxes, levies, faposts, duties, deductions, . withholdings, reserves or other charges 'of-whatsoever nature, taposad, levied, collected, withheld ar assessed by ^n/'Goveranent or any political subdivision or tax authority thereof. This Note Is not negotiable end any.holder shall take this Note subject to all clalas, defense, and rights of set-off which aay exist at any ttae. SIGNED SIGNED Jf*ii SKHEO '^azrfJSc/iiJf'tr Or —C nkers Ou r 1 st.March, 7982. Ref: PO'D/SC Mr. Isaac Carlos Malamud, s Mr. Carlos David Malamud, Mr. 6eman Malamud, 'o , Isaac C. Malamud ft Sons, ^•8(90, Mission Boulevard, '■»te 2 , ' ' ,;i Oeigo, r 'ffornla 92109, '• S.A. Dear S irs, ' • ' tie have successfully concluded a loan transaction in the amount. of U.S.S 550,000 at 163 per annum for a one year period. After carefully reviewing your financial statements and the o ffic e building project in Solana Beach, California-, we confirm that we are w illing to make a loan on the following terms and conditions:. Isaac Carlos Malamud and Carlos David Malamud and German Nalamud on a jo in t and several basis. Borrower: U.S.$250,000.00 (TWo Hundred and Fifty Thousand) U.S. Dollars. , }//»**«a t To' iiivvsL lira real ejbnte piuj r c l, airulTteg build tria iH-Snle na Beach, Califo r n ia , through-TGflH QjUlUm>' 2, Llmitedy a U.S. Partnership. Term: One year. Date o f Drawdown: Approximately April 1 st, 1982. Interest: Commercial rate at date o f drawdown. Payment of Principal and Interest: Payable in full on the anniversary o f drawdown. Securi t y : Promissory notes on a Joint & Several basis signed by a ll the borrowers supported by audited statements of net worth Indicating total net worth of at lea st U.S.S 7 million and undertakings by a ll borrowers not to transfer assets out of their ownership or control without lender's approval. u i/ «. T w aaaa. . J M . i CGbmdG***M.flu■«— lilt $6.84 U.S.S22*488.87 U.S.S22,000.00 UAS17.552.26 U.S.$118,486.45 I trust the above will be of assistance to you. Kindest regards. Yours sincerely, ___ for GUINNESS + MAHON LIMITED. Pat OlDwyer, Banking Manager. CREOIT MgHORAWOUH rt"KCMjiMlSK)T. •f APPLICANT t Carlos Malamud, Carman Malamud, Iiaac Malamud. 38 i 333 / OCCUPATION i e/o, L C. Malamud 4 Son*, 4990, Mission Boulevard, Suita 2, Sen Diego, California 92109, U&A. Cllenta of G.M.C.T. T. u-s.sjso.ooo.oo * . Investment purposes. )SE s One year. ■IC%par aanun fixed. NIL KENT FEE < Bf traaafer to Crocker•National Bank, Gerard at Klein*, La Jolla, California for account Eagle Trust. Promissory Nate for U&SS7.000 signed by German Malamud Promissory Nata far U.S487.000 dgned by Carloa David Malamui Promissory Note far U.S.$71,000 ilgnad by baee Carlos Malamuc DOW N: HIT* : XGM OND C .IW O F ■ H O T3S / PROPOSAL ■ I ' lalamud haa already loam with Guinness * Mahon Limited to tha extent f U.S.SI,020,000 end U.3.1150,000. An Intaraat rata of M%fixed applies ' o the loan accounu whilst the backing deposlta earn Interest at 15%, Tha ■. bove loan wea recently sanctioned In the sanies of Carlos Malamud ft Carman ■ Aalamud. We were to obtain a Promissory Note ilgned by themJointly. Ve heve nowbeen requested to advance the funds to three people Jointly ind heve racalvad three separate Promissory Notes as outlined. I have checked ha position with CLM.C.T. and in view of tho fact that _wa have got > hypothecated lepaslt of equal, amount, I consider the position satlalsctory. See over COMMENDEDBEVIEN DATE t Ut July, 1985 d L z '- t+2 IEDIT COMMITTEE raotE s w DATE i tl . . . . . board MIMOTg 1 1 ‘ *~,r* * dI ts »If- C R E D I T C O M M ITTE E A P P L IC A T IO N U n i t : G . 6 M. D u b l i n XKCr M ln u t a N o : '**’ (. .S B /R E N E W A L : D a te : 1 1 .0 1 .1 9 8 9 C r e d it C la s s : S A T IS F A C T O R Y BORROW ER: C A R L O S , GERMAN & A G U S T IN A R U S S E X D E MALAMUD P R O P O SA L & PU RPO SE O F F A C I L I T Y ( S ) : ' ' ■ . F u r t h e r a d v a n c e o f U S $ 8 0 ,0 0 0 i s r e q u i r e d a s a n i n c r e a s e t o e x i s t i n g i s t .w it h v a r i'o u s b f a c i l i t y o f U S 9 1 . 2 7 m i l l i o n g r a n t e d t o a s s .................... ' u s i' n e s s v e n tu re s. S o u r c e o f R e p a y m e n t , R e p a y m e n t P ro g ra m m e & F i n a l . M a t u r i t y : F r o m B u s i n e s s p r o f i t s , f i n a l m a t u r i t y 2 7 . 0 2 . 1 9 9 2 ( N e x t R e v ie w 2 7 . 0 2 . 1 9 9 0 ) _ ____•____________ j__ _ . _. _ ___ _ ’ B a n k ' s In c o m e j I n c l u d i n g H a t u r n o n c a p i t a l . ) ; “ ^ $ 3 ,3 7 5 (N o u s e o f c a p i t a l ) } S e c u r it y M a r g in .5 % le s s a n d S e c u r i t y M a r g in s ' * r s t L e g a l M o rtg a g e o v e r o f f i c e .< L .d llf o r n la . S e c u r i t y M a r g in .2 5 % ” b u ild in g s : A d e q u a te fe e • ■ a t S o lo n a B e a c h , • . S a n D ie g o , . O t h e r C o n d i t i o n s •P r e c e d e n t : N /A - O t h e r In f o r m a t io n : T h e c u s to m e r h a s b e e n know n t o u s o f G .M .C .T . B A N K 'S RISK Eti?6&l)RZ C o m m it t e d : r la n c e ; L -a n t r y R is k P r im a r y R i s k S e c to r R is k : S e cto r: L im it : C om m t: D raw n : b y : G ^ M .C .T ^ In t r o d u c e d D e c is io n : C r e d it L im it :. C om m t: D raw n : < and i s a v a lu e d c lie n t A g g re g a te c o n c lu s iv e o f t h i s p r o p o s a l} t o : Bor rowB r/ f f W a S S * U S $ 1.3 5 m U S S I .2 7 m IR £ 9 2 4 ,6 5 7 IR & 8 6 9 ,8 6 3 : : fo r fo u r y e a rs - N /A - N /A / - 4 1 .4 6 € 1 .4 6 C o u n t r y o f P r im a r y R i s k : U . S . A . S e c o n d a r y R i s k : CAYMAN ______ D o m ic ile : U .S .A . GM B u s i n e s s S e c t o r : P E R SO N A L C B o f I B u s i n e s s S e c t o r : P ER SO N A L R i s k A s s e t W e i g h t i n g : - N /A R e co m m e n d e d b y : C H R IS W A IT E 'fiy v -J « l t t e e * C h a ir m a n 'J a .— o U j ~ ~ M in u te N o : M in u t e N o : ~” Appendix XV (86) Mr Joseph Malone 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Joseph Malone. a) Transcript of evidence of Mr Joseph Malone dated 12 May 2000. b) Investment Agency Account - 1988. c) Letter of 3 October 1988 - Annsbacher Limited to Joseph Malone. d) Balance Sheet of Investment Agency Account as at 31 May 1993 Sterling. e) Balance Sheet of Investment Agency Account as at 31 May 1993 - US Dollars. f) Balance Sheet of Investment Agency Account as at 31 May 1993 - DMK. g) Balance Sheet of Investment Agency Account as at 31 May 1993 Sterling. h) Balance Sheet of Investment Agency Account as at 31 March 1991 — Sterling. i) Balance Sheet of Malone Agency Account as at 31 March 1993 - US Dollars. j) Balance Sheet of Malone Agency Account as at 30 June 1990 - Sterling, k) Letter of 17 November 1986 - JD Traynor to GMCT. 1) Letter of 26 July 1990 - Ansbacher Limited to Guinness and Mahon, m) Letter of 1 August 1990 - Ansbacher Limited to Guinness and Mahon, n) Letter of 1 March 1991 - Ansbacher Limited to IIB. o) Letter of 11 March 1991 - Ansbacher Limited to IIB. p) Letter of 23 May 1991 - JD Traynor to Joesph Malone, q) Letter of 3 July 1991 - JD Traynor to IIB. Letter of 28 September 1992 - Ansbacher Limited to Guinness and Mahon. Malone Agency Account as at 30 June 1990. UNDER OATH ON FRIDAY 12TH MAY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. JOSEPH MALONE Represented by: MR. PEARSE MEHIGAN & CO PEARSE MEHIGAN & CO 8 4 UPPER GEORGE'S STREET DUN LAOGHAIRE COUNTY DUBLIN WITNESS MR. J. MALONE I EXAMINATION MR. JUSTICE COSTELLO PAGE 11 7O 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Malone, we will start our interview then. I am 6 Declan Costello and on my right is Ms. Mackey. 7 have been as you know appointed by The High Court to 8 investigate these matters that are set out in the 9 Order we sent you. We 10 11 I should explain at the outset Mr. Malone that this 12 is not a Court hearing and it is not a Tribunal 13 hearing. It is an investigation. 14 15 If during the course of the questions that we ask 16 you you wish to obtain the advice of your solicitor 17 please tell us and we will stop asking you the 18 questions. 19 20 Similarly, if Mr. Mehigan thinks that he wants to 21 give you advice about any questions he can indicate 22 so to us and we will stop asking the questions. 23 MR. MALONE: Thank you. 24 MR. JUSTICE COSTELLO: Mr. Malone, the 25 evidence is taken under 26 oath and I will ask Ms. Cummins, our solicitor, to 27 administer the oath to you. 28 29 1 mention something. 2 MR. MEHIGAN: If I may before he goes under oath. 3 4 MR. JUSTICE COSTELLO: Yes . 5 MR. MEHIGAN: Just to bring some matters 6 to the attention of the 7 Inspectorate. 8 MR. JUSTICE COSTELLO: Yes . 9 MR. MEHIGAN: That we have come upon in 10 the recent days and, 11 indeed, recent weeks. 12 MR. JUSTICE COSTELLO: Yes. 13 MR. MEHIGAN: Just to add to and elaborate on matters that 14 15 have been raised in Mr. Malone's statement. I have 16 discussed them with Ms. Cummins before we sat but I 17 do believe they are relevant. 18 introduce them and explain their origins. I would like to just 19 20 If you refer to the first part of the second page of 21 our statement Mr. Malone mentions how in 1992 22 he borrowed a sum of $300,000 from Irish 23 Intercontinental Bank on a back to back basis and he 24 says in his statement: 25 26 27 28 29 "Unfortunately, despite a thorough search of my papers I do not appear to have any documents relating to that loan." 1 back to his home in the US and went through his 2 private papers in his home and has managed to come 3 up with some, not necessarily all, the documentation 4 in relation to those loans or debts and I have 5 handed in copies. 6 Bank of Ireland dated the 6th January 1992, which 7 more or less accounts for those payments. 8 is not quite $300,000 but it is as close I think as 9 makes no odds. There is a letter from the The total 10 11 He has some files as well that I have shown 12 Ms. Cummins, which I will hand in if you like to 13 have a look at them. 14 (INDICATING). 15 loans and things and that is what the US$300,000 was 16 used for, to discharge those debts and payments. They are the original files They relate to, as I say, personal 17 18 19 In an earlier part of the statement, and this is all 20 part of Mr. Malone's efforts to try and come up with 21 further documentation, he said: 22 23 "I never withdrew funds by cash or cheque from Guinness & Mahon Ireland Limited." 24 25 MR. JUSTICE COSTELLO: Yes. 26 MR. MEHIGAN: I think that needs to be 27 amended because while 28 technically or factually it may be correct, he never 29 received cash from Guinness & Mahon Ireland Limited 1 nor did he receive a cheque from Guinness & Mahon 2 Ireland Limited. 3 booklet of documentation that we have handed in, 4 dated 23rd May 1991. 5 Joe Malone and it details a number of payments, 6 US dollar payments. One is US$60,000 transfer to 7 O'Dwyer Bernstien. The second was an US$80,000 8 transfer to Coolidge Bank & Trust Company, which was 9 a account of Mr. Malone. There is a letter, included in the It is from J. D. Traynor to Then there was a transfer 10 to AIB in sterling representing a total of 11 IR£4 0 ,000 . 12 13 It transpires that those monies were paid to 14 Mr. Malone through a bank operated by Des Traynor in 15 the US and the bank was Hanover Trust Manufacturers. 16 We do not have the cheques I do believe but I am 17 just saying that now because those three payments 18 were payments to Mr. Malone on foot of monies 19 deposited in the Cayman Islands. 20 MR. JUSTICE COSTELLO: 21 We will have to examine all these documents. 22 MR. MEHIGAN: Yes. 23 MR. JUSTICE COSTELLO: Mr. Malone can explain 24 on oath to us what these 25 documents are. 26 MR. MEHIGAN: That is fine. 27 MR. JUSTICE COSTELLO: And we may have to recall 28 29 Mr. Malone later but at the moment we will just note that you have got 1 2 MR. MEHIGAN: 3 MR. JUSTICE COSTELLO: Yes . 4 MR. MEHIGAN: I just put it on record 5 that those payments -- it 6 may appear, as I said later, that the statement is 7 factually incorrect and I just wanted to correct it 8 now. 9 MR. JUSTICE COSTELLO: Finally...(INTERJECTION). 10 I am sorry, this letter of the 23rd May 1991, we 11 already have that. 12 MR. MEHIGAN: You have that letter. 13 MR. JUSTICE COSTELLO: Yes. 14 MR. MEHIGAN: I understand that but 15 what I am saying is I am 16 linking that letter to Mr. Malone's statement or 17 the part of his statement where he says he 18 never withdrew funds by cash or cheque from 19 Guinness & Mahon Ireland Limited. 20 money that was transferred to him through another 21 bank account operated by Mr. Traynor in the US. 22 MR. JUSTICE COSTELLO: Yes. 23 MR. MEHIGAN: On foot 24 In fact it was o f ...(INTERJECTION). 25 MR. JUSTICE COSTELLO: Yes . 26 MR. MEHIGAN: It amounted to the same 27 thing, I think, is what I 28 am saying. 29 again at the bottom of the first page where he Lastly, there are two other payments 1 describes how his relationship with Guinness & Mahon 2 ended, and how he duly closed his account and used 3 the funds he held at the time to pay off loans. 4 has had no further dealings with the bank since 5 then. He 6 7 Again, recent enquiries have unearthed documents 8 which have not been, or are not, before you but they 9 are now and I have furnished copies to Ms. Cummins. 10 Again, I will tender the original 11 There a number of payments, totalling US$155,000, 12 which was the balance of money at the time in his 13 account in the Cayman Islands when he closed the 14 account. 15 debts and liabilities in America. (Same Handed). They were used to discharge again certain 16 17 However, again the reason I am introducing this is 18 that the balance after the US$155,000, left a 19 balance of IR£15,000 in the account and that was 20 transferred to his account in the Allied Irish Bank, 21 Foster Place by cheque dated 9th May 1995. 22 MS. MACKEY: To AIB? 23 MR. MEHIGAN: To AIB, Foster Place. 24 MS. MACKEY: In 19? 25 MR. MEHIGAN: 1995, the 9th May 1995. 26 The payments, as I said, 27 clearing his account were all May 1995. 28 just linking back that to the part of his statement 29 where he said he never withdrew cash or cheque. Again, I am In 1 fact he did receive a payment from The Irish 2 Intercontinental Bank in the sum of £15,000, which 3 was the balance of the monies. 4 MS. MACKEY: Yes. 5 MR. MEHIGAN: And, finally, and this 6 again has only come to our 7 attention again as a result of his secretary trying 8 to go through all his papers, there is a payment 9 here which went into the same account in the AIB, 10 dated 26th August 1993, and again from The Irish 11 Intercontinental Bank in the sum of IR£8,000. 12 13 I am only introducing these and putting them on the 14 record because they have only now, as a result of 15 his various enquiries though his accounts and papers 16 etc, both in New York and back here, been upturned 17 in the recent weeks and as recently as yesterday. 18 MR. JUSTICE COSTELLO: 19 20 21 22 23 24 25 26 27 28 29 Very well Mr. Mehigan. Thank you. if you could administer the oath then. Ms. Cummins, 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: Mr. Malone, could you just 5 briefly outline your 6 career, your business career, and then we can come 7 to deal with your association with "Ansbacher"? 8 9 A. Of course. Of course, Judge. Ryans Car Hire. In 1951 I joined Six or seven months later I became 10 Manager of Ryans Car Hire. 11 twelve cars and I worked with Dermot Ryan as his 12 General Manager, and subsequently as his Managing 13 Director, At that time we had from 1951 until 1956/57. 14 15 Then I left to start, and I started, Joe Malone 16 Self Drive Limited, which was my own company, in 17 May 1957, which I ran for about six/seven years. 18 Then I sold it to -- during those six or seven years 19 we built up a fleet of about 600 cars with Depots in 20 Dublin, Cork, Limerick and Shannon -- 21 Belfast and Shannon. 22 and about twenty chauffeur driven cars. Dublin, Cork, We had 200 leased cars also 23 24 I sold that company to the Kenny Motor Group in 25 England in 1964 and then worked with them. 26 was a gentleman's agreement that I would stay for 27 three years and after two and a half years I told 28 them I didn't want to stay any longer. 29 There 1 Then I left them and I was then Chairman of the 2 Rehabilation Board and I worked there for about 3 three months, while I was deciding what I might do. 4 5 I was approached by, the then Marketing Director of 6 Bord Failte, Michael Whelan, and invited to become 7 General Manager North America for The Irish Tourist 8 Board. 9 position, which I took up in early 1967 and I became After a month or two I accepted this 10 -- I was there until 1976, late 76. 11 October 197 6 I became Director General of 12 Bord Failte. I think 13 14 Then I left Bord Failte in 1983 and worked with 15 Smurfits as Executive Vice President Marketing for a 16 year. 17 18 Then I joined General Automotive Corporation, Ann 19 Arbor, Michigan, 20 worked there from 1983 until 1988. 21 part of the time in New York. 22 first year and then moving to Ann Arbor, Michigan 23 for the last four years. for a five year contract and I Then resident I think it was the 24 25 Then I took up a position as President of the 26 Saulders Hotel Group, which was the Boston Port 27 Plaza Hotel & Towers, an 1,100 bedroom hotel, where 28 I worked for five years but unfortunately because I 29 contracted prostate cancer I had to resign my 1 position. 2 done very little as an executive. Since 1992, late 1992, I really have 3 4 In 1990 I had a company called International Focus 5 Consultants in New York, which I think I commenced 6 around, approximately around, 1993 and I did some 7 consultancy work. 8 9 Then in 1995 together with Cathal Mullen, who was 10 the former Chief Executive of Aer Lingus, we formed 11 a company called Malone Car Rental and we started 12 operations on 1st May 1995. 13 that around the end of 1999 to The Carey Motor Group 14 in Cork and that is my career, Judge. 15 2 Q. 16 Just for clarification, you were in Bord Failte as General Manager North America? 17 A. 18 3 Q. 19 Yes. Then you came back to Ireland, did you, as Director General of Bord Failte? 20 A. 21 4 Q. 22 A. 23 5 Q. 24 A. 25 26 Yes. Subsequently we sold Yes. That was in 1976? Yes. How long were you Director General of Bord Failte? Until 1982. I was appointed by the then Government under Liam Cosgrave. 6 Q. 27 In 1982 then you ceased being Director General, did you? 28 A. 29 7 Q. That is right, yes, late 1992. And then? 1 2 8 Q. 3 A. 4 9 Q. 5 A. One year. 6 10 Q. One year. 7 A. 8 Then you moved into The Smurfit Company? Yes. How long were you with The Smurfit Company? So, that got you to 1983, is that right? Yes, and then I joined General Automotive Corporation, Ann Arbor, Michigan. 9 11 Q. 10 A. 11 12 Q. 12 In Michigan? Yes. You would have resided in Ireland up to that date, is that right? 13 A. 14 13 Q. 15 A. 16 14 Q. 17 A. Up to -- yes, up to 19 -- yes. Then you moved to Michigan? That is right. I moved to New York first, Judge. Yes? Because when they originally hired me it was really 18 to be their Vice President for The Eastern 19 Seaboardyes. 20 A. But they fell out with the Massachusett's and the 21 New York Authority. 22 Arbor, Michigan. 23 15 Q. 24 A. 25 16 Q. 26 A. 27 17 Q. 28 29 So, then I had to move to Ann You were effectively then in the United States then? That is right. In these different positions you have indicated? Yes. And the Malone Car Rental in 1959, this was operated here in Ireland, was it? 1 18 Q. 2 A. 3 19 Q. 4 A. Did you come back to live in Ireland then? I came back to Ireland in 1997. Yes? Actually the background to that is the company ran 5 into a lot of financial difficulties because we lost 6 two Managing Directors within the course of two 7 years, both died of brain haemorrhages. 8 20 Q. 9 A. Yes? And the company ran into financial difficulties and 10 as it had my name I tried to come back to help it 11 out. 12 21 Q. 13 A. Yes? Now, I wasn't working. 14 guide it. 15 capacity in i t . 16 22 Q. 17 A. 18 23 Q. I mean I was there trying to I didn't actually work in an executive Then...(INTERJECTION)? But then we resolved that. Yes. Then Mr. Malone will you come now to deal with 19 your relationship with Mr. Traynor and with the 20 companies that he was associated with? 21 first meet Mr. Traynor? 22 A. 23 24 Q. 24 A. When did you Around 1963, early 1964. Yes? When I was negotiating with The Kenny Motor Group to 25 sell my company on the introduction by Shell & BP. 26 Shell & BP indicated to me that they wanted 27 The Kenny Motor Group to take over the franchise for 28 the sale of petroleum, oil products 29 on...(INTERJECTION). 1 25 Q. 2 A. 3 26 Q. 4 A. 5 27 Q. 6 A. 7 Well, Okay. Okay, yes. It is just about how...(INTERJECTION)? That is how. Well, what happened...(INTERJECTION). How you met Mr. Traynor? Well, what happened was Mr. Traynor owned Dublin Petroleum. 8 28 Q. 9 A. 10 29 Q. 11 A. 12 13 We need not go into too much detail? Yes? And they wanted to get control of it. Yes? And they asked me to try and buy out Dublin Petroleum from Mr. Lanigan, yes. A. I had a meeting with Mr. Lanigan and Des Traynor 14 accompanied him to the meeting as his financial 15 advisor. 16 30 Q. 17 A. 18 31 Q. Anyway you got to know Mr. Traynor then? Yes. I want you now to come along to deal with the 19 relationship that developed, the business 20 relationship that developed, between you and 21 Mr. Traynor. 22 Mr. Traynor? 23 A. 24 When was that first suggested by As far as I can recollect it was some time in the early 1970's. 25 32 Q. 26 A. In New York. 27 33 Q. In New York? 28 A. 29 34 Q. Yes? Yes. It was when you were still in Bord Failte? 1 2 35 Q Alright. What was the relationship and just tell me 3 as such as you can remember? 4 what was it? 5 A When it first started Well, Ireland was much smaller, you know, and there 6 weren't as many people travelling to the States then 7 as now and it was a big deal. 8 function here in Dublin when I was back from Bord 9 Failte. I met him at a He said that he was going to the States and 10 could I suggest a hotel he might stay at and I said, 11 "Of course." 12 you if you like." 13 and his wife invited my wife and myself to meet with 14 him and that was really the beginning of, you might 15 say in the broadest sense, a personal relationship. 16 36 Q 17 A 18 37 Q 19 A 20 So, I made arrangements and he Yes ? Prior to that it was an acquaintance relationship. Yes ? So, I met with him. I arranged his hotel for him and met him in New York. 21 38 Q 22 A 23 39 Q 24 25 I said, "I will make arrangements for When was that? That was around 1992 -- sorry 1972/73. Yes. If we could just deal with the business relationship? A Of course. Well, at that time I was asking him 26 about what was happening in Ireland, I had some 27 property and things in Ireland, and I just was 28 asking his advice. 29 1 2 "Joe," he would like to meet me for breakfast and I 3 met with him I think a day later. 4 know, if you really are interested in having someone 5 look after your interests in Ireland," he said, "I 6 would be very pleased to do it." 7 personal basis. 8 41 Q. 9 A. 10 11 He said, "You This was on a very Yes? And I said, "That would be great," and that was the beginning of our relationship. 42 Q. Yes. Just give me a little more detail then. 12 was it? 13 for you? 14 A. 15 43 Q. 16 A. 17 44 Q. 18 A. What was the interest he was looking after Well, then I had stocks and shares in Ireland. Yes? And he said that he would look after them for me. Yes? Up to then all of my banking had been with 19 Provincial Bank of Ireland in Upper O'Connell 20 Street, which is now Allied Irish Banks. 21 45 Q. 22 A. What Yes? But he said that he would open an account for me 23 with Guinness & Mahon and that he would open, as I 24 was non-resident in Ireland, a non-resident account 25 for me and that was the beginning of the 26 relationship. 27 46 Q. 28 A. 29 47 Q. Yes? And he began to look after my interests. Yes. What was this non-resident account? Were you 1 2 Were you going to use this as a savings account? 3 A. 4 48 Q. 5 A. Sorry, for savings? Savings? A savings account, no. Well, my recollection at the 6 time was that he was just going to use this account 7 to trade the shares for me, to buy and sell shares. 8 49 Q. 9 A. 10 50 Q. 11 To use the shares? Yes. It was not an account that you were going to put money into and cash cheques on and that? 12 A. 13 51 Q. 14 Not at that time, no. Not at that time, no. Did he mention putting this into the Cayman Islands at this time? 15 A. 16 52 Q. 17 A. Not at that time, no. When was the Cayman Islands first mentioned? It is very hard to remember. It would be probably 18 around 1975/76. 19 would be appropriate as I was a non-resident that he 20 -- it was around 1975, that he would -- was it 21 alright with me if he opened an account for me in 22 the Cayman Islands. 23 53 Q. 24 He just said that he was -- it What does "appropriate as non-resident" mean? Was he talking about the tax position? 25 A. 26 54 Q. 27 A. I think so, yes. Yes, Sir. Tell me about that? I was resident in the United States and -- yes, he 28 had transferred money for me. 29 Central Bank because I had to get money in, to buy a He had applied to The 1 house in the States, 1967/68 and 2 through Provincial Bank. 3 money in 1974/75, I think around that time, and I 4 asked him and he said he would arrange it for me. 5 Then he came back and said, 6 You are a non-resident," 7 with The Central Bank and that was that. 8 55 Q 9 A 11 56 Q 12 A that he had been in touch However, Mr. Malone that is an exchange control Yes . I was asking you about the income tax. What did He didn't say anything at that time about the income tax. 57 Q 16 When did he talk to you about the income tax then, a liability for tax? 17 A 18 58 Q 19 A 20 59 Q 21 22 "There is no problem. he tell you about the income tax? 14 15 Then I needed some more problem? 10 13 I got that myself It didn't arise for years. It did not arise? For years, your Honour. Right. You still have not told me how it came about that he was suggesting the Cayman Islands? A Well, he just said was it all right with me if he 23 opened an account in the Cayman Islands and that he 24 transacted my business in the Cayman Islands. 25 said that Guinness & Mahon had a branch in the 26 Cayman Islands and that he was trying to build up 27 his client portfolio, and would I allow him to do 28 that. 29 He 1 2 61 Q. 3 From then on you knew there was money being deposited? 4 A. 5 62 Q. 6 A. That is right. 7 63 Q. When was that? 8 A. 9 Yes, I did, yes. In the Cayman Islands? About 1975/76 you think? Very little because I didn't have that much money then. 10 64 Q. 11 A. 12 65 Q. 13 A. 14 66 Q. No. However, I just want to get the dates? Yes, around that time. Around then. Yes? Around that time as far as I can recollect. Thereafter then you would transfer money to him, 15 would you, in Dublin and he would transfer to Cayman 16 or would you put it directly into Cayman Islands? 17 A. 18 67 Q. 19 A. 20 I never did it directly. Yes? I mean I would transfer it from New York to him or ...(INTERJECTION). 21 68 Q. Yes? 22 A. Yes. 23 69 Q. 24 I ... (INTERJECTION) . Did you know that this was a subsidiary of Guinness & Mahon? 25 A. 26 70 Q. 27 A. I did, yes, because he said it was. He was Chairman? He had indicated that to me. He may not have been 28 Chairman at that time your Honour. I mean my 29 recollection is that he wasn't Chairman of 1 2 71 Q. 3 A. 4 I know he was Joint Managing Director with Maurice O'Kelly here at the time. 5 72 Q. 6 A. 7 73 Q. 8 A. 9 10 I see? Yes? Of Dublin. Yes? But it was subsequent to that I understood that he became Chairman. 74 Q. Right. Did you then as time went on, from 1975/76, 11 then arrange to transfer funds to Mr. Traynor, which 12 would be then sent on by him? 13 A. 14 75 Q. 15 A. 16 7 6 Q. 17 Yes. To your deposit account? Yes, your Honour, yes. You would have been building up over the years a deposit account in the Cayman Islands? 18 A. 19 77 Q. 20 A. 21 Yes. Yes? It was not really until 1985/86 because the amount of money I was earning in Bord Failte. 22 78 Q. 23 A. 24 79 Q. 25 A. Yes? My earnings allow me to do it, your Honour. Yes? I mean for the record I was earning £12,000, a year 26 of which I paid £5,000 in tax, when I worked with 27 Bord Failte. 28 daughters in college in the United States that was 29 costing me $6,000 each. That left me £7,000. I had two So, I really was living 1 2 80 Q. 3 A. 4 81 Q. 5 A. 6 82 Q. 7 A. 8 You just had you salary from Bord Failte? That is all, that is all. You were paying tax on that in the United States? No, sorry. No? I am talking about 1976, late 1976, when I came back to Ireland. 9 83 Q. 10 A. 11 84 Q. 12 A. 13 85 Q. 14 A. Sorry, my apologies. 15 86 Q. No, it was my fault. I see. I understand? I had a good salary. Yes? In the Unites States your Honour. I see. Sorry, I misunderstood you? What you are telling me is 16 that when you came back from the United States you 17 were Director General on £12,000 a year? 18 A. 19 87 Q. 20 A. 21 88 Q. 22 A. 23 89 Q. That is right. You told me what your salary was? Yes. And you were paying tax during this period? That is right. Yes. In relation to the stocks and shares that 24 Mr. Traynor said he was going to look for you: 25 tell me about what the arrangement was in relation 26 to those? 27 A. Well, he was trading them. Just I mean he would buy them 28 and sell them. 29 Atlantic Resources and a number of them didn't do I had losses and profits because 1 2 90 Q 3 A 4 5 Yes ? And at that time the share market wasn't as buoyant as it is now. 91 Q 6 I just want to know the technical arrangements that were made? 7 A 8 92 Q 9 A 10 93 Q 11 A Yes . Were these shares in your name for example? They were all in my name, yes. They were all registered in your name? No, maybe -- no, sorry, your Honour, no. He then 12 told me that he was putting them in an account 13 called -- wait until I see. 14 was -- excuse my memory. 15 94 Q 16 A 17 Yes? But there was a name for it. a numbered account. 18 95 Q 19 A It is -- sorry -- there It was like -- it was Mars Nominee. Yes ? Mars Nominee account and I asked him, "Why 20 Mars Nominee," and he said that most of the shares 21 that he was handling on behalf of Irish residents 22 and foreign residents he had in numbered accounts, 23 Mars Nominee. 24 96 Q 25 The shares that he purchased on his behalf were not registered in your name? 26 A 27 97 Q 28 A 29 98 Q Yes . However, registered in the name of Mars Nominee? That is my understanding. When they were sold then Mars Nominee would get 24 1 2 That is right. 3 99 Q 4 A 5 100 Q 6 If there was a profit? Yes . And that would be transferred then to your account, is that what you thought? 7 A 8 101 Q 9 A 10 102 Q 11 A 12 103 Q Yes, that is correct. And...(INTERJECTION)? In Guinness & Mahon account. In Guinness & Mahon in Dublin? Yes . Then when you opened the account in Guinness Mahon 13 Cayman Trust in the Cayman Islands, was the money 14 then transferred there? 15 A 16 I didn't realise it was Cayman Trust. I thought it was just Guinness & Mahon Bank. 17 104 Q 18 A 19 105 Q 20 A 21 106 Q 22 A 23 107 Q 24 The name of the company? Sorry. It is the name of the company? I see, was Guinness Mahon Cayman Trust. Yes? I wasn't aware of that your Honour, yes. Am I right in understanding that the money was then transferred? 25 A 26 108 Q 27 A 28 109 Q 29 A Yes . To Cayman? Yes . If you made a profit on it? Yes, yes. Yes, your Honour, but also I had a 25 1 resident account. 2 the years I was back here in Ireland with 3 Guinness & Mahon in Dublin for other monies that 4 he was handling on my behalf. 5 110 Q 6 What were these then Mr. Malone? What were these monies ? 7 A 8 111 Q 9 A 10 112 Q 11 12 I had a resident account in I honestly can't remember your Honour. Yes? I am not avoiding but...(INTERJECTION). However, when you say he was handling it, what was he doing with them? A No, no. This was really like -- it was like a -- it 13 was what you call it? 14 account. 15 113 Q 16 A Was he investing them? It was a non interest bearing Well...(INTERJECTION)? For instance I had occasion in 19 -- this might help 17 you if I am rambling on just tell me your Honour. 18 In 1981 or 1982 I got a call from Allied Irish Banks 19 in Dublin to tell me that I was in deliquency, that 20 I was in £41,000 -- it was £41,000 or £43,000 and 21 they gave me three days to repay it. 22 Des Traynor and I said, "Des, look I have this," and 23 he said, "What is your bank? 24 He said he would transfer it that day from a 25 resident account and I don't know how he handled it 26 without any -- I didn't have any backup or 27 documentation or anything, the £41,000 or £43,000 to 28 Allied Irish Banks. 29 I called What is your number?" A. So, that is what it was used for. It was like a — yes. 115 Q. 4 So you had this facility then by which Mr. Traynor was able to make a payment on your behalf? 5 A. 6 116 Q. 7 A. 8 117 Q. 9 A. A checking account. 10 118 Q. A checking account? 11 A. 12 119 Q. That is right. Yes? It was a checking account. Sorry? Yes. These were funds that you had transferred to him. 13 It was not a loan. 14 paying to AIB? 15 A. It was your money that he was No, my understanding at the time was that that had 16 nothing to do with the money that he had on my 17 behalf in Cayman Islands or non-resident accounts, 18 that he would just loan me that money on it. 19 120 Q. 20 A. 21 121 Q. 22 A. He lent it to you, did he? Yes. A loan? Yes. He just said — and I had another occasion 23 your Honour. One of my family got into severe 24 difficulty in Dallas in Texas and I went out to try 25 and get bail and I was told that I had to produce 26 $75,000 bail and I didn't know who to contact. 27 I called Des in Dublin and within two hours he 28 transferred $75,000, not from my money, from 29 Guinness & Mahon in Dublin. So, 1 122 Q 2 A 3 4 To an account which allowed me to get one of my family out of difficulty. 123 Q 5 Yes. However, then presumably you had to pay it back? 6 A 7 124 Q 8 A 9 125 Q Yes, I did. Yes, of course. Very well? Yes . Some of the documentation that you have given us 10 Mr. Malone shows that the bank in Cayman held 11 shares. 12 shares ? 13 A 14 Were these in addition to the Mars Nominee I honestly don't know. I really don't know your Honour. 15 126 Q 16 A 17 127 Q You see. .. (INTERJECTION)? Yes, yes. As I understand it Mr. Traynor was investing on your 18 behalf in stocks and shares on the market, and was 19 registering the shares in Mars Nominee, in the name 20 of Mars Nominee? 21 A 22 128 Q 23 Yes . However, we have records that you have given us showing The Cayman Bank? 24 A 25 129 Q 26 A 27 130 Q 28 A 29 131 Q Yes . Apparently registered shares? Yes . Holding share? That is right, yes. 1 2 132 Q 3 A 4 Were these in addition to the Mars Nominee shares? Well, I may be wrong but my understanding was at the time, you know, when he took my account off-shore. 5 133 Q 6 A 7 Yes ? And that that handled the Mars Nominee as well your Honour. 8 134 Q 9 A 10 135 Q 11 A I see? That was my understanding. Yes ? But I did. To answer your question, I am not 12 avoiding your question, 13 in addition to the Mars Nominee and whether it went 14 into Mars Nominees or directly into -- you know, 15 whether Cayman -- Mars Nominees was, what would you 16 say, controlled by Cayman or whether it was just 17 transferred to Cayman, I am not sure. 18 136 Q 19 I did add other money to it You see we have the accounts that you have given us. It was called the Investment Agency Account? 20 A 21 137 Q 22 A 23 138 Q 24 A 25 139 Q Yes . Which shows Arran Energy Shares? That is right, yes. Looking at the account (Exhibit 1)? Yes . In 1988 it shows Arran Energy Shares, it shows AIB 26 Shares, it shows CRH Shares, it shows Bank of 27 Ireland Shares? 28 A 29 140 Q Yes . 1 2 141 Q 3 A 4 142 Q Yes . What I want your assistance on Mr. Malone was 5 whether or not, in addition to this holding of 6 shares in this account, you had in addition other 7 shares in Mars Nominees during this period or was 8 everything transferred? 9 A 10 143 Q 11 A 12 144 Q I thought everything was transferred. Everything was transferred? My understanding is that everything was transferred. Yes MR. MEHIGAN: 13 Perhaps, Judge, if I could 14 just refer to the 15 document? 16 MR. JUSTICE COSTELLO: 17 No. It is alright. I will manage alright? 18 145 Q 19 A 20 146 Q MR. MEHIGAN: Okay? Thank you your Honour. MR. JUSTICE COSTELLO: 21 Everything had been transferred to the 22 Cayman Islands from about the time that you would 23 have opened the account in the Cayman Islands, or 24 the deposit. 25 A 26 Well, what I would have had in 1975/76 would have been transferred, yes, your Honour. 27 147 Q 28 A 29 That would have been in 1975/76? Yes? And then as I came -- well, as I began to earn more income and get more income, when I moved to the 1 States in 1985, 1984/85, from then onwards, I used 2 that. 3 account. 4 148 Q 5 A 6 149 Q 7 I am sorry, I transferred money to that Yes ? And bought shares. Yes. You also had, as appears in the accounts, money on deposit in the bank and you had shares? 8 A 9 150 Q 10 A 11 151 Q 12 A In Cayman. 13 152 Q In Cayman. Yes . Is that it? Yes . The Bank...(INTERJECTION)? It states, in the documents that you 14 have given us, that this is the Investment Agency 15 Account. 16 company a subsidiary of the bank in Cayman or were 17 the shares held in the name of the company itself? 18 A 19 Do you know were the shares held by a My understanding is that they were held in the name of the company, Guinness Mahon Cayman Islands. 20 153 Q 21 A 22 154 Q 23 A 24 155 Q 25 Guinness Mahon? Yes . You understood that? That is my understanding, yes. Did you come across or were you associated in any way with a company called Hexagon Securities? 26 A 27 156 Q 28 A 29 157 Q No. You were not? No, your Honour. 1 2 158 Q 3 A 4 159 Q 5 A 6 160 Q 7 A 8 161 Q 9 A 10 162 Q It does not matter? Because...(INTERJECTION). It does not matter at all? That is Okay. Right, Judge. It does not matter at all? Okay. It comes easier. It does not matter? That is Okay. That is all right, Judge. It does not matter any way. We have had evidence of 11 a number of companies that have been established in 12 the Cayman Islands, subsidiaries of Guinness Mahon 13 Cayman Trust Bank, whatever you want to call it. 14 However, you do not think that the shares which you 15 owned were in the name of any subsidiary of the bank 16 in Cayman. 17 bank? 18 A 19 163 Q 20 A 21 You think they were in the name of the I am as sure as I can be. Yes? I would say I am 99.9% sure it was all...(INTERJECTION). 22 164 Q 23 A 24 165 Q Yes? Yes . Yes. I would just like to bring you through some 25 of the documents that you gave to us. 26 please 27 A 28 166 Q 29 Page 136 (Same Handed)? Thank you very much. This is a letter of the 3rd October 1988 2 )? (Exhibit 1 2 167 Q. 3 "Two copies of the statements of your investment account with us"? 4 5 A. 6 168 Q. 7 A. 8 169 Q. 9 A. 10 170 Q. 11 A. 12 171 Q. 13 A. 14 172 Q. 15 A. 16 Yes. That is from Mr. Furze? Yes. Did you ever meet Mr. Furze? I met Mr. Furze on two occasions. Yes? I met him at Des Traynor's funeral. Yes? In Dublin. Yes? And I was in Cayman Islands with four friends from Ann Arbor, Michigan. 17 173 Q. 18 A. 19 174 Q. 20 A. I think it was around 1988. Yes? 1987 or 1988. Yes? And I mentioned to Des that I was going down playing 21 golf with my wife and these friends and he said, 22 "Why don't you call into him". 23 175 Q. 24 A. 25 176 Q. 26 A. 27 177 Q. 28 A. 29 178 Q. Yes? "And see your bank". Yes? Quote unquote. Very well? And I met Mr. John Furze. Yes? 1 And I think there was man by the name of Collins 2 also there. 3 179 Q 4 A 5 180 Q 6 A 7 181 Q 8 A 9 182 Q Was that a social occasion? Just social. Yes ? I just had a cup of coffee with him. Yes? Well, a cup of tea. Would you just look at the next document? 10 pass on the next document? 11 (Same Handed) 12 documents. 13 A 14 Would you It is 137, 138 and 139 I think we will pass on all these The whole of that tab (Same Handed)? Are you asking me a question in relation to this one (INDICATING). 15 183 Q 16 A 17 184 Q 18 A 19 185 Q 20 A 21 186 Q 22 A 23 187 Q 24 A 25 188 Q Pardon? Are you asking...(INTERJECTION). No, no. No, you are not, no. I just want to...(INTERJECTION)? Me to see it. Introduce you? Okay. To the documents? Yes . The documents then, that you have forwarded to us, 26 refer then to the different accounts. 27 turn to the document, the bottom of the page is 28 numbered 139 (Exhibit 3)? 29 Would you 1 2 "J.N. &/OR I. MALONE." 3 4 It was in the name of yourself and your wife, was 5 it? 6 A 7 Yes, but my wife never knew anything about it your Honour. 8 190 Q 9 A 10 191 Q 11 A 12 192 Q Yes? And that was in case of my demise. In case of your demise? Yes . Yes, I see. 13 Would you just look at that: "Cash at Bank: A/c. " "A/G" Call Deposit 14 15 Throughout these documents there is a reference to a 16 code "A/G". 17 A 18 193 Q 19 A 20 194 Q Did you know what that was? No, your Honour. You did not? I don't even know today. If we look through the documents you will see 21 reference to the -- page 142. 22 4) Do you see: 23 "Cash at Bank"? 24 25 A I do, yes, I do. 26 27 28 29 ""A/G" Call Deposit Account." (Exhibit 1 196 Q 2 A 3 197 Q Yes . It is a Deutsche Mark. Is that a Deutsche Mark? 4 "(Expressed in Deutsche Mark.)" 5 6 A 7 198 Q Yes . Do you see: 8 "Deposit Account - "A/G"." 9 10 A 11 199 Q 12 A 13 Yes. Can you tell me what that was? I can't your Honour. I don't know. I can tell you what happened at that time. 14 200 Q 15 A 16 201 Q 17 A 18 202 Q 19 A 20 21 I do, yes. No. About that bank because...(INTERJECTION). At the moment I am just asking you...(INTERJECTION)? That is all right. Okay, right. About...(INTERJECTION)? No, I don't. I don't know. I don't know your Honour. 203 Q Do you see that it appears that this was a coded 22 account in "Ansbacher" and that the code "A/G" was 23 referring to your account. 24 A 25 204 Q 26 A 27 205 Q 28 A 29 206 Q Did you know that? No, I didn't your Honour. You did not? No. If you look at page 146 (Exhibit 6 )? Yes . 1 "ASSETS"? 2 3 4 5 ""A/G" Call Deposit. "A/G" U.S.D. Deposit. "A/G" DMK Deposit" 6 7 8 A. 9 208 Q. 10 A. 11 209 Q. 12 A. 13 210 Q. 14 Yes . You do not what...(INTERJECTION)? No, I don't. What does that mean? No. Yes. The statement of accounts shows then -- the documents that you have given us? 15 A. 16 211 Q. Yes . Shows the shares that the bank held on your behalf 17 and shows the deposits that you held. 18 also shows the interest? 19 A. 20 212 Q. 21 Yes . That was earned on the deposits. 1997? 22 A. 23 213 Q. Okay. The 1991 accounts shows: 24 "A/G" Call Deposit" 25 26 27 A. 28 214 Q. 29 A. I think it 197 at the bottom? Page 197? We will move on to 1 215 Q 2 A 3 216 Q 4 A 5 217 Q 6 A 7 218 Q Sorry, that is Okay. That is Okay. Page 171 refers -- it is in hand writing? 167 . Page 167? Right, yes. And then if you turn to page 171: (Exhibit 8 ) 8 9 ""A/G" Call Deposit Account." 10 11 A 12 219 Q 13 A 14 220 Q Yes . 173 (Exhibit 9)? Yes . Throughout these accounts there is this reference to 15 what is clearly your code that refers to your 16 account, is that right? 17 A 18 Yes. Well, I didn't realise. It was a code just referring to my account. 19 221 Q 20 A 21 222 Q 22 A 23 223 Q You did not realise this? I didn't, no, your Honour. If you turn to 184 (Exhibit 10)? Yes . There is another code there: 24 ""A/A38" 25 you did not...(INTERJECTION)? 26 27 A 28 224 Q 29 A No, I see it now. 1 225 Q. 2 A. 3 226 Q. 4 A. 5 227 Q. 6 A. 7 228 Q. 8 A. 9 You did not know what it meant? No, your Honour. Yes? May I make a comment? Yes? Please your Honour? Please yes? Just a lot of these statements I have never seen until we got them recently on the foot of -- I think 10 it was your Order or some Order, which was supplied 11 by the Moriarty Tribunal. 12 229 Q. 13 A. 14 Yes? I had never seen them until then, a lot of these your Honour. 15 230 Q. 16 A. Yes? Now, I am not denying that I didn't get some of them 17 and they didn't have "A/G" on them but I never -- I 18 was more -- actually your Honour I was more 19 interested in the right--hand side. 20 231 Q. 21 A. 22 232 Q. 23 A. 24 Yes? Than in the details. Yes? And the significance of the "A/G" or Mars or these things didn't really...(INTERJECTION). 25 233 Q. Yes? 26 A. Yes. 27 234 Q. If you did not get accounts, these detailed 28 accounts, 29 writing from Mr. Traynor from some source as to how surely you must have got something in 1 2 Well, at that time when I was working in the States 3 I came back to Ireland. 4 that I was on the board of and I would be back to 5 Ireland once a month and on occasions I would ring 6 up and make arrangements to see Des, to come in and 7 have a cup of tea with him. 8 235 Q 9 A 10 236 Q 11 A 12 237 Q 13 A 14 238 Q 15 16 I had a number of boards Yes? And he would just tell me how things were going. Yes. Did he produce any written document to you? Like these? No, not like those? Sorry. Any written document? Anything like a bank statement for example? A 17 No, no, your Honour. I didn't, no. All I got was some things like this. 18 239 Q 19 A 20 Some things like them? And there wouldn't be headings on them or anything. He would just say, 21 240 Q 22 A 23 241 Q 24 A 25 242 Q 26 "Joe, this is for you". However, there would be no headings on them? No headings, no. In fact all names...(INTERJECTION)? Just. There was no name at all on the documents that he would have given you? 27 A 28 243 Q 29 A No. Yes? It would just say: "Joseph N. Malone account." 1 244 Q 2 Yes. This was your account of the funds that you had given to him, which were in the Cayman Islands? 3 A 4 245 Q 5 A 6 That is right, yes. Yes ? And also -- now, I did get statements though from him from Guinness & Mahon in Dublin. 7 246 Q 8 A 9 247 Q 10 A Yes? Which would be addressed to me. Yes ? Which would come in and tell me the Certificates of 11 Deposit, which I would return with my tax and things 12 like that your Honour. 13 248 Q 14 A 15 249 Q 16 A 17 250 Q 18 Yes. When did you get those? They would have come, I think, once a year. Once a year? Yes . Mr. Malone, I think we will just have a break now if that is all right with you? 19 A 20 251 Q 21 A 22 252 Q Of course. For a cup of coffee, for about ten minutes? Of course your Honour. Very well. 23 24 SHORT ADJOURNMENT 25 26 MR. JUSTICE COSTELLO: We will resume Mr. Malone. 27 MR. MEHIGAN: Judge, just very briefly 28 29 before you resume. 1 2 254 Q 3 A 4 Okay. The £41,000 or £43,000 that I got from Des Traynor in relation to my problem with AIB. 5 255 Q 6 A Yes ? To my recollection I took up -- AIB -- I mean I 7 still needed money in Ireland and AIB took a 8 mortgage out -- I think it was my first mortgage had 9 expired at the time. Now, AIB took out a second 10 mortgage, our mortgage, on my house in Abbylin, 11 Foxrock, for around £90,000 and I think that is how 12 I repaid the £41,000 to Des, to Mr. Traynor. 13 256 Q I see. I just want to get some further 14 clarification about the vehicles that were used in 15 your investments. 16 you could just get all the documents. 17 three documents there (Same Handed)? 18 A 19 257 Q Would you turn to Tab 14 and if There are Thank you. Mr. Malone, these are internal documents of 20 Guinness & Mahon here in Ireland. 21 the first one, at page 261 at the bottom, is from 22 "J. D. T ... You will see (Exhibit 11)" 23 24 that is Mr. Traynor, 25 "...to Investment Dept." 26 27 28 29 It is the 30th January 1987. Then he says: "Could you please arrange to let me have a list of any investments you hold on behalf of Mr. Malone, either in his name or in the name of 1 2 3 4 258 Q 5 A Do you know what Executive Trust was? Yes, Executive Trust was a company that I registered 6 and that I was going to operate in Ireland around 7 that time. 8 259 Q 9 10 So, that was a company of which I owned. Why did you establish a company? What was the purpose of the company? A Well, actually at the time I was going to go into 11 another business and subsequent to that that is the 12 company that I used, or the name of the company, for 13 Malone Car Rental. 14 actually Executive Trust and trades as Malone Car 15 Rental. 16 260 Q 17 A 18 261 Q 19 You are jumping way ahead? That is right, yes. In 1987 there was a company in existence called Executive Trust Limited? 20 A 21 262 Q 22 A 23 Yes . Which is registered in Dublin? That is right. It never traded your Honour to my recollection. 24 263 Q 25 A 26 264 Q 27 A 28 29 So, Malone Car Rental is -­ It did not trade but apparently it held shares? Yes, your Honour. Do you know about that? I don't remember recollecting it. I know now, when I see it here. 265 Q Would you turn to the next document, page 263 43 1 2 3 266 Q. 4 A. 5 267 Q. 6 A. 7 268 Q. This is a letter from you to Ms. Marie McKiernan? Yes. It is 1994? Yes. It reads: 8 "I would appreciate if you could arrange to sell all shares held in my name and in the name of Executive Trust Limited, as per the attached Investment Portfolio"? 9 10 11 12 A. 13 2 69 Q. 14 A. You must have known about the company Mr. Malone? I knew about Executive Trust your Honour but I ...(INTERJECTION). 15 16 Yes. 27 0 Q. 17 You said to me a moment ago that you knew nothing about it until I drew your attention to it? 18 A. 19 271 Q. 20 A. 21 272 Q. 22 A. 23 273 Q. 24 A. Sorry. Well, I didn't remember your Honour. Now that you do remember? I do. Tell me about it? You mean -- sorry. No. Please Mr. Malone? No, sorry. Might I tell you that it was a company 25 that was formed, you know. 26 company that I took and I formed and I was going to 27 trade with it. 28 obviously, buy shares with it your Honour. 29 274 Q. It was only a shelf We never traded but I did, That is what I want you to tell me about? 1 That is right. 2 can tell you your Honour. 3 evasive but that is all I remember. 4 completely forgotten this your Honour. 5 11th April 1994, 6 to, you know, use that company your Honour for 7 Malone Car Rental. 8 275 Q 9 That is right. Well, that is all I I am not trying to be that is even prior to the decision You see it looks from the documents that we have company, 11 A 12 276 Q from 1987 to 1994? Yes . I want you to tell me why this was done? 13 the shares not held in your name? 14 shelf company used? A 16 277 Q 18 A 19 278 Q 20 A 21 279 Q 22 A 23 280 Q 24 A 25 281 Q 26 A 27 282 Q 29 I honestly can't tell you. I honestly can't tell Will you look at the next letter then? Yes . The 3rd May 1994 (Exhibit 13)? Yes . This is from Guinness & Mahon? Yes . To you in the Berkeley Court Hotel? Yes . It is referring to your account? Yes . It gives the balance. Why were Why was this you, your Honour. 17 28 The that you held shares, or shares were held by this 10 15 I had Then account of Executive Trust with the balance? 1 283 Q 2 A 3 Yes. I wasn't aware of that your Honour. I am now. I mean. 4 284 Q 5 A 6 285 Q 7 It shows a balance? Yes, of £2,000 and £1,500, yes. "We confirm all holdings in the above names..." 8 9 A 10 286 Q 11 Yes . "...have been sold as instructed." 12 13 A 14 287 Q 15 A 16 288 Q Yes . Then there were enclosed two drafts for the balance? Yes, your Honour. Can you assist me in any way as to what that was? 17 What shares this company held and was it associated 18 in any way with "Ansbacher", with the "Ansbacher" 19 arrangement ? 20 A 21 289 Q 22 A 23 290 Q 24 25 To my knowledge, no, your Honour. This was separate? Separate. Why was that? Why were some shares held in the Cayman Islands and some not? A I don't know your Honour. I don't know. 26 check my records your Honour. 27 I will come back. 28 291 Q 29 A Yes, if you would? I will If there is anything 1 292 Q 2 A 3 293 Q 4 A 5 294 Q 6 Yes . And you might have had...(INTERJECTION)? Yes . For example the Investment Portfolio might be on your files? 7 A 8 295 Q 9 Yes, Okay, right. I will check it your Honour. I want to ask you some questions Mr. Malone about the cash backed loans. Ms. Cummins, would you turn 10 to tab 8 . 11 out, would you (Same Handed)? 12 A 13 296 Q Would you just take the whole of tab 8 Thank you. Mr. Malone, this first document, the bottom of the 14 page is numbered 109, relates to a loan of $50,000 15 in November 1986, is that right 16 A 17 297 Q That is correct. Yes. If you look at the next document, it is a 18 letter of the 17th November, 19 (Exhibit 15)? 20 A 21 298 Q (Exhibit 14)? from Mr. Traynor Yes . It says that you require a facility for twelve 22 months and GMCT will guarantee by way of 23 unconditional guarantee the principal in interest? 24 A 25 299 Q 26 A 27 Yes . This was guaranteed by Guinness & Mahon for you? Yes. I wasn't aware of that at the time your Honour. 28 300 Q 29 A You were not aware at the time? 1 301 Q 2 3 If you were not aware of that how did you think the loan was going to be secured? A Well, the relationship with Des, with Mr. Traynor, 4 was a very personal kind of relationship. 5 every trust in him your Honour. 6 302 Q 7 A I had Yes? And it wasn't really like a formal one where you go 8 into a bank and you sit down and they give you all 9 these papers to sign. 10 303 Q Yes. However, Guinness & Mahon was a bank. It had 11 a customer. 12 must have thought that, no matter what your informal 13 relationship with Traynor was, the Bank would need 14 some security? 15 A 16 304 Q 17 A 18 305 Q 19 A 20 21 Surely you I didn't. You did not? No. Well...(INTERJECTION)? He didn't ask for security in other loans that I got your Honour. 306 Q 22 23 It was lending $50,000. Yes. However, in fact, did Guinness Mahon Cayman Trust not guarantee these loans? A 24 I wasn't aware at that time that they did guarantee it. 25 307 Q 26 A Recently. 27 308 Q Recently? 28 A 29 309 Q When did you become aware of it? Yes . Very well. If you would turn to page 124. 48 This was 1 2 3 Yes . 310 Q 4 The document makes no reference at all to how it was to be secured? 5 A 6 311 Q Yes . Then, I think, if you turn over the page you will 7 see a document from Mr. Traynor to the Bank, and it 8 is the 27th January 1987 (Exhibit 17): 9 "I am returning herewith guarantee form, which I have signed in connection with the U.S. $45,000 loan.". 10 11 12 So this also was guaranteed by Guinness & Mahon. 13 This was a loan, I think, to your son, is that 14 right? 15 A 16 312 Q 17 A 18 313 Q 19 For your son's purposes? Em...(INTERJECTION). If you turn over the page to 127 (Exhibit 18)? Yes . "Joseph Malone," 20 21 and there somebody has written, 22 23 "Junior" 24 25 A 26 314 Q 27 A 28 315 Q 29 Junior, yes. Yes. Joseph W, yes. You see? Yes . Do you see it says: 1 2 3 316 Q. "Security adequate"? 4 5 A. 6 317 Q. 7 A. 8 318 Q. 9 Yes. That also was guaranteed? Yes. In fact, if you turn to the page 130, you will see that this is a letter in April 1987 to Mr. 10 Traynor from your secretary (Exhibit 19)? 11 A. 12 319 Q. 13 A. 14 320 Q. Yes. In Dublin? Yes. "Mr. Malone has asked me to forward the enclosed cheque for U.S.$45,503. If you would lodge against loan which he took out on behalf of Joseph W"? 15 16 17 18 A. 19 321 Q. 20 21 Can you tell me the circumstances in which that payment was made? A. 22 Because the loan that I took out on behalf of my son, we didn't use the money. 23 322 Q. 24 A. 25 26 Yes. Yes? It was never used. So, it was returned to Des Traynor. 323 Q. 27 I see. Where did you get the cash from for the cheque? 28 A. 29 324 Q. I would have to check that your Honour. Would you do that? 1 2 325 Q 3 A 4 326 Q 5 A 6 327 Q If you go back...(INTERJECTION)? Of course. If you would go back some pages to 119? 119, Okay. You will see that this is a letter addressed to you 7 on the 11th August 1987. 8 2 0 )? 9 A 10 328 Q 11 Have you got that (Exhibit Yes, I have. This is a $50,000 loan. Then if you would look at the interest: 12 "We propose charging interest on the loan at 2 % over the cost to Guinness & Mahon Limited of taking funds for the period of the loan." 13 14 15 16 What did that mean to you? A Well, that means to me that whatever -- in other 17 words that if they got money from The Central Bank, 18 that whatever the cost to them of that amount, they 19 would charge me 2 % more. 20 329 Q 21 A 22 330 Q Yes? That is what that meant to me. Or if they got money from, if they could use, the 23 deposit, your deposit, in the Cayman Islands, that 24 may have been transferred, in respect of which there 25 was an arrangement, that the money could be used 26 here in Ireland. 27 money, could it not? 28 Well, other loans that I have taken out from other 29 banks your Honour, they always say 1% over prime or It could have been your Cayman 1 2 331 Q. 3 A. 4 332 Q. 5 A. 6 333 Q. I see? And that would be my understanding. I see? That was the situation. I see. Right. Would you turn to page 132 (Exhibit 2 1 )? 7 8 A. 9 334 Q. Yes. This is a loan. This is a memorandum from 10 Mr. Traynor to Mr. O'Dwyer, in April 1987. 11 loan in U.S, dollars of $45,000. 12 other document. 13 page 132? 14 A. 15 335 Q. 16 A. 17 336 Q. 18 Yes, I have 132. I am sorry. It is a Sorry, that is the Would you turn to Yes, your Honour. This is an internal credit committee application? Yes. It is a loan application for US$35,000 for Mr. Malone? 19 A. 20 337 Q. 21 Yes. If you look at the third line of the paragraph: "Security is held - funds held by Ansbacher."? 22 23 338 Q. 24 25 used as security for this loan? A. 26 27 Is it not clear that "Ansbacher's" funds were being It does now. It does, yes, but I wasn't aware of that at the time your Honour. 339 Q. Yes. If we could turn to the loan that you referred 28 to at the outset of your evidence, the US$330,000 29 loan from? 1 2 340 Q 3 A 4 341 Q From IIB? Yes, your Honour. If you turn to page 140 please. 140 is it? 5 page 40. 6 letter from "Ansbacher" to The Irish 7 Intercontinental 8 A 9 342 Q 10 I am sorry it is at page 40. (Same Handed) Sorry, It is a (Exhibit 22)? Thank you. This is a letter from Mr. Traynor to IIB to Ms. Lynch? 11 A 12 343 Q Yes . It is the 9th December 1991. It is: "Dear Siobhan, I have written to you separately re facility for Joseph Malone. 13 14 This is to confirm that Ansbacher will guarantee the facility and place U.S.$350, 000 to credit of a separate Deposit Account." 15 16 17 18 19 Did you know anything about that? A I did at the time, yes. He told me because he said 20 that -- I remember Des saying that they had entered 21 into a relationship with Intercontinental Bank in 22 Ireland and he gave me some reason as to why they 23 couldn't do it through Guinness & Mahon any more. 24 344 Q 25 A Yes ? Because I think "Ansbacher" had bought over 26 Guinness & Mahon in Ireland I think but that was 27 my understanding that "Ansbacher" bought over 28 Guinness & Mahon, and "Ansbacher" in Ireland had an 29 arrangement with Intercontinental Bank and that they 1 2 345 Q 3 Mr. Traynor told you why it was from IIB and not 4 from Guinness & Mahon? 5 A 6 346 Q 7 A 8 347 Q 9 A 10 348 Q 11 Yes . Then he told you they needed a guarantee? That is right, yes. And this was going to be given by IIB? That is right. If you would just turn to the security letter. is page 42 (Same Handed) 12 A 13 349 Q It (Exhibit 23)? Thank you. The security letter is dated December 16th. It 14 gives the normal paragraph heading and then if you 15 turn to the second page, page 43, and to Security? 16 A 17 350 Q 18 Yes . The security is: "The deposit by the Borrower with IIB of the share certificates... ."? 19 20 A 21 351 Q 22 A 23 352 Q Yes . Relating to Jefferson Smurfit? Yes . There is no reference at all to the fact that the 24 loan was being guaranteed by IIB. 25 that -- sorry, it is being guaranteed by 26 "Ansbacher". 27 A 28 353 Q 29 A Did you notice Did you notice that? No, I didn't your Honour. Yes? No, I didn't, but I thought that all the 54 1 Intercontinental -- sorry, I had a few -- I think 2 two loans from Intercontinental and I thought that 3 all of them were backed by "Ansbacher". 4 354 Q 5 A 6 355 Q 7 A 8 356 Q 9 That was my understanding. They were? Sorry, yes. However, they were not referred to in the facility letter? 10 A 11 357 Q 12 A 13 358 Q 14 A Sorry, yes. That is the point I make? Yes, your Honour, I understand now. Yes? Incidently I was very unhappy with that at that time your Honour really. 15 16 They were? 359 Q 17 If you could just turn to page 101 please (Same Handed)? 18 A 19 360 Q 20 Yes . This is a letter from Joan Williams. knew Joan Williams 21 A 22 361 Q 23 A 24 362 Q 25 A 26 363 Q 27 I take it you (Exhibit 24)? Yes . She was Mr. Traynor's secretary? I do, yes. You did? Yes, yes. Yes. She was acting -- this was in October 1994. This was after his death, I think? 28 A 29 364 Q Yes . It was for Hamilton Ross, she was acting for 55 1 2 "Please apply interest to our Account N o " 3 4 Blank, the number is given, 5 "...and transfer sufficient to close the Loan Account in the name of Mr. Joseph Malone. 6 7 Please make no reference to source on the loan transfer details." 8 9 Do you know why that was put in the letter? 10 A 11 365 Q 12 A 13 3 66 Q 14 A 15 367 Q 16 A 17 368 Q 18 I am sure not. However, you...(INTERJECTION)? No, I wouldn't know. You would not know? No. You do not know why she would...(INTERJECTION)? No. Instruct the bank not to make any reference to the source? 19 A 20 369 Q 21 No, no, your Honour. Yes. I see. I just want to turn to another subject briefly Mr. Malone? 22 A 23 370 Q 24 Yes . It is about the withdrawals which you made from Guinness & Mahon and IIB? 25 A 26 371 Q 27 A 28 372 Q 29 I have never even seen this before. Yes . Page 189 (Same Handed) (Exhibit 25)? Thank you. You see Mr. Malone that this is a letter in 1 2 "Could you please arrange the transfer of US$60,000 to: Chemical Bank..." 3 4 And: 5 "... for credit to the Account of O'Dwyer & Bernstien..." 6 7 And then: 8 "...the cost should be debited to Ansbacher Limited A/G U.S. Dollar Call Account." 9 10 11 This was in respect of a payment that you had 12 directed to be made? 13 A 14 373 Q 15 That is correct. Yes. There was a transfer being made from the "Ansbacher Limited A/G U.S. Dollar Call Account," 16 17 18 and the number is given? A are saying your Honour? 19 20 374 Q 21 A 22 375 Q 23 A 24 376 Q 25 A 26 377 Q 27 A 28 378 Q 29 The number of the account is given, is that what you Yes. Also the code number "A/G"? Yes, but I wouldn't have seen this your Honour. No, I know that? Yes . Yes, I know that? Yes, I understand. I understand, yes. What I am...(INTERJECTION)? Yes . What I am suggesting to you Mr. Malone is that it does appear from this letter that the payment which 1 you requested to be made of $60,000 was made by 2 drawing out of an "Ansbacher" Limited account 3 designated: 4 "A/G U.S. Dollar Call Account," 5 6 with a number? 7 A 8 379 Q 9 Yes . That, in fact, refers to your funds. Would you agree with that? 10 A 11 380 Q 12 A 13 381 Q That is what is suggested. Yes ? Yes, your Honour. Very well. Would you just look at the next letter? 14 It is page 190 (Same Handed). 15 a few days later 16 A 17 382 Q This is August 1990, (Exhibit 26)? Yes . Your instructions are for Mr. Traynor to transfer 18 US$80,000 to a bank in Boston to the credit of 19 Mr. Malone, and debit "Ansbacher" Account and it is 20 the same account number? 21 A 22 383 Q 23 A 24 384 Q 25 A 26 385 Q 27 Yes, your Honour, yes. It looks like it? It does. It looks like your account, does it? It does. It does. If you turn to page 191, the 1st March 1991. again from Mr. Traynor (Exhibit 27)? 28 A 29 386 Q Yes . It is a payment of US$30,000 to the account of 58 It is 1 2 3 Yes . 387 Q 4 And: "The Sterling cost should be debited to Ansbacher Limited Call Account," 5 6 and it is a different account. 7 debiting an account which was used for your 8 purposes, is that not so? 9 A 10 388 Q It seems to be Yes, your Honour. The 11th March, page 192, there is another transfer 11 of IR£10,000 to AIB. 12 (Exhibit 28) number is given. 13 same number as the other one and the "Ansbacher" 14 Limited Call Account with the number, same number, 15 is to be debited? 16 A 17 389 Q 18 It seems to be the Yes, your Honour. Very well. There is a letter then that we have already referred to at page 193 (Exhibit 30)? 19 A 20 390 Q 21 Yes . Would you turn to a letter at page 194 of the 3rd July (Same Handed)? 22 A 23 391 Q 24 It is an account and the Okay. "I would be grateful if you would immediately arrange to transfer the sum of US$60,000 to - Bank of Ireland," 25 26 in New York for the account of yourself and your 27 wife and the debit should be to the US Call Account. 28 The account is again designated with a number and 29 then account "AG". This seems to be your code, does 1 2 3 392 Q 4 Then there is another letter, on page 195, in September 1992 5 A 6 393 Q (Exhibit 31)? Yes . In which Mr. Traynor asked Mr. Humphries to arrange: 7 "For collection as soon as possible a U.S. Dollar draft for US$35,000 payable to Mr. J.N. Malone and debit the cost to Ansbacher Limited re Poinciana Ltd. No 2 Account." 8 9 10 11 Have you heard of Poinciana Ltd.? 12 A 13 394 Q 14 No. That account is being used to make the payment which you required? 15 A 16 395 Q Yes, I see that. Yes. Apart from the fact it would indicate, these 17 documents indicate, that the coded account was being 18 used to make these payments. 19 you were directing fairly substantial sums to be 20 paid out of your account. 21 statement to us that you did not make any payments? 22 You said: 23 It does appear as if Why did you say in your "I never withdrew funds by cash or cheque from Guinness & Mahon Ireland Limited." 24 25 26 A 27 But I thought that my counsel had explained that at the beginning. 28 396 Q 29 A Well...(INTERJECTION)? At that time, when I made that, I made it in 60 1 2 3 397 Q 4 A 5 398 Q 6 No, you are misunderstanding me? Sorry. I am sorry your Honour. The documents which I have referred you to show that there was substantial payments being made? 7 A 8 3 99 Q 9 A 10 400 Q 11 A 12 401 Q 13 Yes . Out of your account? Yes . In Guinness & Mahon here in Dublin? Yes . Your statement, which was given to us quite recently, 14 states: "I never withdrew funds by cash or cheque from Guinness & Mahon Ireland Limited"? 15 16 17 A Yes. I am sorry your Honour. I understood that to 18 be the use of deposits by Irish residents in 19 Ireland, that I never withdrew money out of it in 20 Ireland. 21 It wasn't that I didn't withdraw them when I was in 22 America. 23 402 Q That is what my understanding of that was. What you were telling us then: You were not telling 24 us that you withdrew funds from your accounts in 25 Guinness & Mahon in Ireland, you were telling us 26 that you did not withdraw them in Ireland? 27 28 29 A That is right. your Honour. That is what I meant by that 1 2 A. 3 404 Q. It is not now. Sorry, you are right your Honour because my counsel 4 or my lawyer, when he came in, explained that now I 5 have discovered two or three and also now I have 6 discovered these your Honour? 7 405 Q. 8 A. 9 But at the time I understood -- I mean when I talked to Mr. Traynor, I understood these were not coming 10 11 Very well? out of Ireland. 406 Q. I mean...(INTERJECTION). Is the position then that these sums, that we have 12 referred to in this correspondence, were paid by 13 Mr. Traynor as a result of instructions which you 14 gave him? 15 A. That is right. I would call him and say, "I need 16 this or I need that or I need the other," and he 17 would...(INTERJECTION). 18 407 Q. Would you write to him or would you telephone him, can you remember? 19 20 A. Telephone him. 21 408 Q. Telephone him? 22 A. 23 409 Q. 24 Yes. You would telephone him from America and ask him for funds ? 25 A. 26 410 Q. 27 That is right. You thought that the funds were going to come from the Cayman Islands, is that the position? 28 A. 29 411 Q. Yes. When did you learn, in fact, that the funds came 1 from the account here in Guinness & Mahon, these 2 coded accounts in Guinness & Mahon? 3 learn that? 4 A. When did you Well, I learned before the Moriarty Tribunal. The 5 Intercontinental Bank ones I knew came from Ireland 6 because it came from The Intercontinental Bank. 7 other ones I wasn't aware of, came from Ireland, 8 until I checked my records and found one or two 9 there that went directly to AIB and these ones 10 11 (INDICATING) 412 Q. The I only learned about today your Honour. Mr. Malone, it appears that you opened, or 12 Mr. Traynor on your behalf opened, a deposit account 13 in the Cayman Islands around about 1975/76? 14 A. 15 413 Q. Yes. You were Director General of Bord Failte until 1983 16 and then you were here in the position that you have 17 mentioned in Smurfits? 18 A. 19 414 Q. 20 21 A. Yes, late 1983 I got -- I was contracted to go to Michigan. 415 Q. 24 Yes. When did you, in fact, take up residence in Michigan? 25 A. 26 416 Q. 27 A. 28 417 Q. 29 It seems as if it was about 1984 or so that you went to Michigan, would that be right? 22 23 Yes. I went to New York. New York? I had a residence in New York. When was that? 1 2 418 Q. 3 A. 4 419 Q. 5 Or nine months later. From 1975/76 to 1983 you were resident for tax purposes in Ireland? 6 A. 7 420 Q. 8 9 Yes? Yes, your Honour. Did you return any of the interest that was earned on the Cayman deposits for tax purposes? A. I am looking into that at the moment because any -­ 10 what would you call -- any certificates that 11 Des Traynor supplied to me, I paid tax on. 12 421 Q. 13 A. 14 Yes? But now I have engaged a tax advisor because of the domicility and because of the residency. 15 422 Q. 16 A. 17 Yes? Both here and in the United States to have a look at all of this. 18 423 Q. 19 A. 20 424 Q. 21 A. 22 425 Q. 23 A. 24 426 Q. 25 A. 26 427 Q. 27 A. He is an auditor. 28 428 Q. He is an auditor? 29 Who is looking after your tax affairs? Here in Ireland? Yes? A man by the name of Ken Ryan. Sorry? Ken Ryan. He is an auditor. Ken? Ryan, R-y-a-n. Yes? 1 429 Q 2 A 3 430 Q 4 A 5 431 Q He is in private practice. What is his firm's name? I think it is Muldow, M-u-l-d-o-w, Ryan & Company. Yes. I was not talking about certificates of tax. 6 It was certificates of interest in relation to 7 interest that was earned on funds in Ireland. 8 talking about interest that was earned in the 9 Cayman Islands? 10 A 11 432 Q 12 I am Yes . I am asking you was that interest, whatever it was, returned for tax purpose? 13 A 14 433 Q No, your Honour. No. Would I be correct in saying that from the 15 point of view of the Revenue, the Irish Revenue, it 16 was never returned. 17 after a certain date? 18 A 19 434 Q 20 A 21 435 Q 22 A 23 436 Q You say you were not resident That is right, your Honour. Yes, that is right. So you would not have to? That is right, yes. For whatever reason it was never returned? That is right your Honour. I just want to come to the question of when you 24 ceased to be a taxable person here under the Irish 25 Code. When was that? 26 A 27 437 Q But...(INTERJECTION)? 28 A For...(INTERJECTION). 29 438 Q 1974/75 my understanding was. 1 2 439 Q. 3 A. Yes? Then when I came back to Ireland I paid it. 4 all my returns. 5 and...(INTERJECTION). 6 440 Q. 7 A. I made I paid all my taxes in Ireland Until when? Well, but even when I was in the States I had -­ 8 even when I was in the States I had property in 9 Ireland that was let and I returned all of that to 10 the Irish tax authorities and paid my tax on it. 11 441 Q. 12 A. 13 442 Q. 14 Yes? That is from 1967 until 1997. Yes. So that on property you were liable to make returns for tax purposes? 15 A. 16 4 43 Q. 17 That is right. What I am concerned about is income, did you pay...(INTERJECTION)? 18 A. 19 444 Q. 20 A. 21 445 Q. 22 A. I paid income tax too. I mean on...(INTERJECTION). On that? On? On the property? On the property and on any investment -- sorry, I 23 Director's fees, I had other things that I got, and 24 all of that was paid. 25 446 Q. 26 Ireland as being resident in Ireland? 27 A. 28 447 Q. 29 Were you treated by the Revenue authorities in During the years that I was here in the 1970's? Yes? 1 448 Q 2 States, in 1983 onwards? 3 A 4 449 Q 5 A 6 Yes . What was the tax position then? I was not treated -- I was treated as a non-resident. 7 450 Q 8 A 9 You were not treated as a non-resident? Yes. For any income I would have earned in Ireland I would have returned it and I would have looked 10 for...(INTERJECTION). 11 451 Q 12 A 13 452 Q 14 A 15 16 And the years after you left and went to live in the Double taxation relief? That is right, yes, in the United States. On the basis that you were non-resident? Yes, that is right and that was the way it was handled. 453 Q In relation to any of the gains that you may have 17 made, including interest on the deposit in the 18 Cayman Islands, did you return that to the 19 US Revenue authorities? 20 A 21 454 Q No, your Honour. No, your Honour. I did ask you at the very beginning whether the 22 tax position was discussed with Mr. Traynor. 23 discussed with Mr. Traynor at all? 24 A 25 455 Q 26 A 27 456 Q Was it No, it wasn't. It was not? No, it wasn't. Did you get advice from anybody, from Mr. Ryan or 28 anybody, as to whether or not you were liable to 29 return these? 1 2 457 Q 3 A 4 458 Q 5 You did not? No. In t h e S t a t e s d i d y o u h a v e a n a d v i s o r , an a c countant to a d v i s e you on your i n c o m e tax p o s i t i o n ? 6 A 7 459 Q 8 A 9 4 60 Q 10 A 11 461 Q Yes, I mad e returns in the Unites States. Did y o u . . . (INTERJECTION)? No, n o t in r e l a t i o n t o C a y m a n I s l a n d s . Y o u d i d not t a k e an y a d v i c e in r e l a t i o n to t h at? No, b u t I a m at t h e m o m e n t y o u r H o n o u r . Yes. V e r y well. T h a n k y o u Mr. Malone. 12 e v e r y t h i n g w e n e e d to a s k y o u Mr. 13 l i k e t o l o o k at t h e d o c u m e n t s y o u h a v e g i v e n us 14 today? 15 A 16 462 Q Of course, However, Malone. T h a t is We would yes. u n l e s s t h e r e is s o m e t h i n g i n t h a t w e m i g h t 17 n o t h a v e to t r o u b l e y o u a g a i n . 18 to t r o u b l e y o u t o c o m e b a c k to s i g n t h e t r a n s c r i p t 19 of t h i s e v i d e n c e . 20 a s k y o u to c o m e i n to s i g n it? 21 A 22 463 Q 23 A We will however have It w i l l b e t y p e d u p a n d w e w o u l d Could I ask something? Yes? Your Honour, m a y I sign that in the U n i t e s Sta t e s 24 w i t h a l a w y e r i n t h e U n i t e s S t a t e s a n d h a v e it 25 ...(INTERJECTION). 26 464 Q 27 A 28 465 Q 29 A I see. Mr. M a l o n e y o u a r e g o i n g b a c k t o t h e S t a t e s ? Yes . That w o u l d be all right. We could arrange that? 1 4 66 Q 2 A 3 467 Q 4 5 Yes . We might have to ask you to get a notary public to witness your signature? A Yes, I will, yes. I will get my lawyer in America to...(INTERJECTION). 6 7 468 Q 8 A 9 Yes, exactly. My lawyer will contact the lawyer in America and do the whole thing. 10 4 69 Q 11 A I will look after that, yes. Yes . 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION THEN CONCLUDED Thank you very much. 0 (0036 . 7/5407 we, 4:50 V00 0 a r f ft H W tf • * s. A ran S n a r g y A .Z .U . '• 8h a r « « CRH S h a r e s Bank o f I r e l a n d C a p .S h a r e * A N S B A C H E R LIMITED A MemberofiheHwwyAoetteehwMwehenl BentingOwmp P.O.Box M7 OrendCayman MMh Wed Indiee CP4306 C i»AddfeesOKwneee 3rd O cto b e r, 19 8 6 » ' -> » . J . H . M a lo n e , B a g ., 1 6 N a t e r a B d g e, Rye, N .Y . 10 5 8 Q r ■D ear H r . M a lo n a , W ith t h i a l a t t a r I h a v a p l a a a u r a i n e n c l o a i n g tw o o o p la a o f t h a a t a t e n e n t a o f y o u r i n v a a t a a n t a c c o u n t w it h u a . ■ Z th in k yo u w i l l f in d th a f i g u r e s t o b a s t r a ig h t fo r w a r d and i n t h a e v e n t t h e y a g r e e w i t h y o u r r e c o r d * . I a h o u ld b a g r a t a f u l . i f y o u w o u ld k i n d l y a i g n t h a a p p r o p r i a t e c o p y a n d r e t u r n i t t o Daa T r a y n o r t o s a n d o n t o m e . •. I n t h a e v e n t y o u h a v a a n y q u e r i e a on t h a f i g u r e s , p l e a s a l e t e i t h e r Daa o r m y a a lf know a a a o o n a s p o s s i b l e . B e a t w is h e s . Y o u rs s i n c e r e l y i vfrhp JA F/K JW jat&sa.,, (AD tigMm txprwnd In Ponmk Sterlbti) ASSETS: lavotMcntmlCoM - ptrSchtdste Gull at Bank: "AAS* C*H Dtpodt A/c CurrentAccmmt 20t a (404M ) 8tg,U4^$l.U R tp n m M k y : LIABILITIES; , » . . Capital Aecomt Accounts Payable(at* schedule) Stg. 1<1,595J1 3^45J7 , / LAGEMfiy ACCOUNT Wnfnart Sfcwt a» at 31* May. 1993 (AH f lp m ii pru d hi U A PoMm) \ Asggrst Caah atBaak "A/O" CallDqwslt Account $35040000 RtynMltd by:LIAPILIT1ES; CapitalAccoaat *39UINNMM) - A O JKflOBtMAlflfig INVESTMENT AGENCY ACCOUNT BriwwShwt . ■sat May 31.1993 (Expressed in Deutsche Mark) ASSETS: Cuhal B n k DeposJi Accoaal - ’A/O" DBM 34004.75 Representedby: LIABILITIES: Capital Acoouol DEM 34,004.73 JJf. and/or L MALONE INVESTMENT AGENCY ACCOUNT (AH figuresexpressedin IHxjndsSttrfng) LIABILITIES; r Capital Account 415^519.82 Accounts Payable .1333.56 £417.853.38 Represented by:- ASSBTS; Investments (atcom ) 165,04446 "A!Q TQUIDeposit ‘^4,74057 '•A/G" U.SJD. Deposit 22435857 "A/Q" DMK Deposit -J&2Q2L3& £417.1153.38 Note: The following exchange rates have been utilised; GBP - USD 1.56 GBP - DMK 2.48 J -N . A /O R I . MALONE IN V E S T M E N T AGENCY ACCOUNT BALANCE S H E E T A S A T 3 1 S T MARCH 1 9 9 1 ( A ll f ig u r e s e x p re sse d in Pounds S t e r lin g ) ASSETS: In v e s t m e n t s a t C o s t - p e r S c h e d u le 1 5 8 ,2 7 8 .6 8 C a sh ' a t B a r i k : " A /G " C a l l D e p o s it C u rre n t A ccount (3 4.85) (586.65) S t g .£157,657.18 R e p re se n te d b y : L IA B IL IT IE S ; C a p it a l A ccount S t g .E I5 7 ,6 5 7 .1 8 ij: id x tn\Loioe P>t)tAtXe AS R T Cexwes^Bj) StfeeT. 3 / ar H Q R C H w Mccwof iWl i/S . •& ou -/>a s ) flSS£T*' - "/ye " C/1 U, 2>£7bsrr ^ccflw/OT■ C a p iTfcVc. * a fitcomor ustt -4/6 3 6 g .^ g ■j. U sg 6 /4 .3 6 E - 4 6 ^^_^QR^^aLONZL.A.QEU.GY._Ai;.CPiJNT BALM;CE_SUKlS3,_A5._AT_J.0TJLjUKj^./_J,aaJJ / (A ll fig u r e s exp ressed in pounds sterlin g ) f.TABlLlTY: - c a p ita l A ccount > Stg. 1 7 6 ,4 9 4 .3 3 Represented b y - A S S E IS :In v e stm e n ts - 10 ,0 0 0 A ran E n erg y C n sli a t b a n k : "A /G " C a l l D e p o s i t A c c o u n t C urrent A ccount 4 ,9 8 1 .0 8 1 7 0 ,5 3 7 .0 6 9 7 6 .1 9 ' Stu. 1 7 6 ,4 9 4 .3 3 G U I N N E S S M A H O N C A Y M A N T R U S T LIMITED A Mamba* o*tha M m m m Mahan Marcham lankm« 8nup roBnm TataphmiaNa l « U 4 PtMMrapiyto 3 Trinity Stw*. Q/and Cayman Talar CP 304 Dublin 2. S ntiiJtWarn IMiaa C a b la M d ra a s QmIiu m m Tab 796944/794834 . •u rra f Talwc 93867 Facalmie: 720642 1 7 t h N o vem b er, T 9 8 6 . JD T /A J W p . O 'D w y e r, E s q . , G u in n e s s + Mahon L i m it e d , 1 7 C o lle g e G re e n , D U B LIN 2 . r 1 Dear P a t, J o e M a lo n e , who l i v e s a t : 2 0 1 5 W ashtenaw , A nn A r b o r , M ic h ig a n 4 8 1 0 4 , U. S . A. . r e q u i r e s a f a c i l i t y o f U . S . $ 5 0 ,0 0 0 f o r tw e lv e m onths w it h i n t e r e s t d e b it e d q u a r t e r l y b u t r o l l e d up u n t i l m a t u r i t y . ■s G .M .C .T . w i l l g u a r a n t e e b y way o f u n c o n d it io n a l g u a ra n te e th e p r in c ip a l and in t e r e s t . j 3 M r. M alo n e w i l l r e q u i r e t h e f a c i l i t y t o b e a v a i l a b l e t o . h im i n New Y o rk o n t h a 2 6 t h N ovem ber. W ould you t h e r ie f o r e p le a s e l e t ma know a s q u i c k l y a s p o s s i b l e w h e th e r o r n o t G u in n e s s + Mahon a r e p r e p a r e d t o p r o v id e t h e f a c i l i t y . . Y o u rs s in c e r e ly . J .D . T rayn o r, C h a ir m a n . A M tm b tr o f th e H e n ry A n s b a c h e r H o k tin p P L C M e rc h a n t B a n k in g G ro u p /= © 8 f e , Please reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 P.O. Box 817, Grand Qiyman, British W o t i~ h«* Phone: (809) 94M 6S 3/4 T a le s C P 4305 Fw c (809) 949-7946 (809) 9494267 2 6 th J u ly ., 1990. M. D a v id H u m p h r ie s , E s q . , S e n i o r M a n a g e r *- O p e r a t i o n s , G u i n n e s s & M ahon L i m i t e d , 1 7 C o l l e g e G re DUBLIN 2 . D e a r D a v id , C o u ld y o u p l e a s e arrange e tr a n s fe r o f U S$60,000 to: C h e m ic a l 5 2 B ro a d : ■ New n.y. 1 fo r c r e d it to th«& .c c o u n t o f cou n t N o.016-023498 The c o s t D o lla r - C al ) I d b e d e b i t e d t o A n s b a c h e r L i m i t e d A /G U . S . A ccount N o .13154962. ' P l e a s e a d v i s e w hen t h e t r a n s a c t i o n h a s b e e n p u t i n t r a i n d d £ e v a ly t e s h o u l d b e r e c e i v e d a t C hem i c a l B a n k s o t h a t I a p v i s e Q l i f e n t w ho c a n t h e n m onJ/C or fr o m o t h e r e n d . l < W 5 Y o u r s y f e in c e r e ly j * J.D . T ravnor. «T and can j— j M tm --- -— ^ • Lc— _______ _ ltr 'o fth t H tn rv .A ty b a d u r- H o lS ^Ansbacher Limited in jtj( fM tr c h a M 242 Fitzwilliam T . s y“ :Sc q u> a r e , ---- ' Dublin 2. Tfel: 765144/763065 Fax: 612035 Tslsx: cp 4joj F»* (809) *9-7M« ^ 94WM7 1 s t A u g u st, 1990, M. D a v id H u m p h r ie s f E s q . , S e n io r M anager - O p e r a t io n s , G u in n e s s & M ahon L i m i t e d , 17 C o l l e g e G r e e n , ' DUBLIN 2 . ■ Dear David, C o u ld y o u p l e a s e a r r a n g e t o - t r a n s f e r U S$80,000 t o / C o o l i d g e B ank' a n d T r u s t C om pany 7 5 A r l i n g t o n S t r e e t •* B o sto n . / MA 0 2 1 1 6 ./ ‘ fo r c r e d it t o / A cco u n t N am e/ J o s e p h N . M a lo n e A ccount N o / 810-099-3 T h e d e b i t s h o u l d g / i t o A n s b a c h e r L i m i t e d A/G U . S . C a ll A c c o u n t N o .V £ 1 5 4 9 6 2 . P le a s e a d v is e ^ a t e v a lu e c a n b e .e x p e c t e d V ours s i n c e r e l y , ^ T > / J.D . T ravnor / / ' B o n k in g \Group D o lla r in B o sto n . AMoacner unuted A U tm b tr t f ih i H m ry A iu M m H oU b tgi P L C M trth an t Banking Group F.O. B n M7, Omad Cijmaa. M iik Wot M jtf Please reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 76314V763065 Fuc612035 Rmm: (M») ** 4433,4 Tate CP 4309 Fuc flW) M M M «09) M9-S267 l e t M a rc h , 19 9 1 G a r r e t t Lo g an , E s q ., I r i s h In t e r c o n t in e n t a l Bank L im it e d , 91 M e r r io n S q u a r e , DUBLIN 2 . . D ear G a r r a t t , • I w o u ld b e g r a t a f u l 1 2 y o u c o u ld p l e a s e a r r a n g e v a l u e M onday 4 t h M arch t o t r a n s f e r IR £ 3 0 ,0 0 0 t o A l l ie d I r i s h Banks B an k ce n tre B ran ch B ra n c h N o . 93 1 3 65 f o r c r e d it to th e A cco unt o f M r. and M r s . J o s e p h M a lo n e A c c o u n t N o .2 7 3 1 5 0 4 8 . T h e S t e r l i n g c o s t s h o u ld b e d e b it e d t o A n s b a c h e r L i m it e d C a l l A c c o u n t H o .0 2 / 0 1 0 8 7 / 8 1 . I n v ie w o f t h e tim e e le m e n t in v o lv e d I am l e t t i n g yo u h a v e a c o p y o f t h i s l e t t e r by f a x - t h e o r i g i n a l w i l l r e a c h y o u i n t h e n o r m a l way on M onday. y o u rs s in c e r e ly . > Ansmcner u*nittq A Mmktr tfUm Hiwy Amtmktr NoUbigi N jC Mtnhom Making Grot? Please reply to: 42 FitzwBUam Square. Dublin 2. T d : 765144/763065 R u : 612035 P.O. In ItT.flood Caynun. Brxbh W m h»«n * m e 009) MMU3/4 Tatac CP 4303 Fie (MO 94f-7M6 (109)949-3367 1 1 t h M arch , 1 9 9 1 . G a rre tt Logan, E s q ., I r i s h I n t e r c o n t i n e n t a l B an k L i m i t e d , 91 M e r r io n S q u a r e , DUBLIN 2 . D ear G a r r e t t , Z w o u ld b e g r a t e f u l i f Z R fil0 ,0 0 0 t o yo u c o u ld p l e a s e a r r a n g e t h e t r a n s f e r o f A llie d I r is h Banks B a n k ce n tre B ran ch B r a n c h N o .93 1 3 65 fo r c r e d it to th e A ccount o f M r. and M rs . J o s e p h M alo n e A c c o u n t N O .2 7 3 1 5 0 4 8 . I w o u ld l i k e 1 5 t h M a rc h . th e fu n d s to r e a c h t h e A cco u n t no t l a t e r th a n th a P le a s e d e b i t t h e S t a r l i n g c o s t t o A n s b a c h e r L im it e d C a l l A c c o u n t N o .0 2 /0 1 0 8 7 /8 1 . . Y o u rs s i n c e r e l y . v ' J .D . T ra y n o r. JSSST*"" f™. 612038 42 FITZWILLIAM 8QUAHE, DUBLIN 2. S T R IC T L Y PBRSOHAL 2 3 r d N a y , 19 9 1 iT.tf. M a lo n e , E s q . , P r e s id e n t /M a n a g in g D i r e c t o r , B o sto n P a rk P la z a H o t e l A T o v a r s , 50 P a r k P l a z a , BOSTON, '' H A .0 2 1 1 7 . • ■ D ear J o e , . I h a v e p le a s u r e I n e n c l o s i n g h e re w ith A c c o u n ts e t o . C o r b o th S t e r l i n g and 0 . 6 . D o l l a r A g e n cy A c c o u n ts . i n Cayman f o r t h e ' p e r io d *<3t J u l y 19 9 0 ( l a s t A c c o u n ts you had v e r e t o 3 0 t h J u n e ) t o t h » 3 1 s t M r -r i. 1 9 9 1 . x t h in k t h a t most ite m s a r e v e r y d e a r b u t I w ou-d j u s t make r e f e r e n c e t o a num ber o f w it h d r a w a ls -mmt ' ' . . . (1) U . S . $ 6 0 ,0 0 0 w as t r a n s f e r r e d t o S p e c ia l A c c o u n t . • (2 ) V . 8 .$ 8 0 ,0 0 0 w as t r a n s f e r r e d t o you a t C o o lid g e B a n k . an d T r u s t Com pany. , (3 ) The t r a n s f e r t o A . I . B . in S t e r lin g re p re se n te d a t o t a l o f X R S4 0 ,0 0 0 -s e n t i n two t r a n c h e s , one f o r X R £ 3 0 ,0 0 0 * . and th e o t h e r f o r I R « 1 0 ,0 0 0 . . • ' The f ig u r e in d i c a t e d a s t r a n s f e r r e d t o S. * M. o f ' S t g . 8 8 1 8 .7 7 r e p r e s e n t e d IR E 8 8 0 .4 0 and was t o t a k e u p t h e r i g h t s o f 2 2 0 1 S h a r e s i n A ran S n e rg y . Th e se ' r i g h t s w ere on 36 6 9 A ra n S h a r e s w h ich a r e h e l d - i n y o u r *••• . name a t G u in n e s s A M ahon. I am a t t a c h in g h e r e t o a '* copy p f my l a t t e r o f t h e 1 2 t h . A u g u st '8 7 i n t h i a .c o n n e c t io n . I . *' . * * * S h o u ld you h ave a n y a d d i t i o n a l q u e r ie s , p le a s e a d v is e . ■ . ' * w it h k in d e s t r e g a r d s , ' . (4 ) . /Y o u r s s i n c e r e l y , J.D. Travnor. . ■ A M*mh*r oftht HtmryAntbtdm Holding)PIC Mtnhmu Am*** Group P.O. Bm 1*7.Grand Cayman. BrfariiWat India Phoot (*09)MMC33/4 Take CP 4X3 Fuc (B09)M9-7946 (*0?) ' ~ Please reply tor 42 Flttwillitm Square. Dublin Z Tel; 765144/763065 Rue 612035 3rd July, 1991. Garrett Logan, taq., Irish Intercontinental Bask Ltd., 91, Merrion Squara, Dublin 2. JUL1991 • ’7fWon eq.. Dear Garrett, eh* I would be grateful If you would immediately arrange co crana far of BS$60,000 to ' sum Bank of Ireland, Jf*w Tork Branch, 640 5th Avenue, Hew tork, 8.Y. 10019. For Account of Joseph end Imelda Malone Account No. 01205136 The Debit ahould be to U.S. Call Depoaitf03/05442/81(88?) Please advise value date it will be in place. Yours sincerely, J. D. Treynor. Please icply to: 42 FttzwjfliamSquare, Dublin2. P.O.feax 887, Qnmd Cayman, Cayi ' IW: 765143/763065 Rue 612035 IWpWJIlK Faosftnfl* N . D a v id H u m p h r ie s , B s q . , S e n i o r M an ag er - O p e r a t i o n s , G u in n e s s & Mahon L i m i t e d , 1 7 C o lle g e G re e n , D U B LIN 2 . mds, British Wett I 949^635 Telex: CP 4305 I) 949-7946 (809) 949-5267 28tM S e p t e n b e r , 1 9 9 2 . D e a r D a v id , C o u ld yo u p l e a s e a r r a n g e t o l e t n e h a v e f o r c o l l e c t i o n a s s o o n a s p o s s i b l e a U . S . D o l l a r d r a f t f o r U S $ 3 5 ,0 0 0 p a y a b le t o M r. J . N . M a lo n e a n d d e b i t t h e c o s t t o A n s b a c h e r L i m it e d r e P o in c ia n a L t d . N o . 2 A c c o u n t N o .0 8 4 2 8 0 3 0 . Y o u rs s in c e r e ly . AM»n»orTiA>iACHriiHiwM«ncim.'nBjarAmnwmiorrmn ’ O U U W B Y . MONACO AMD S W I f m U M D / H / ^J^sraeaLja£^gid.taX^ M ' v f pn*>M B a l a n c e as at 3 1 s t D e c e m b e r , 1989 165/877.03 Net s u r p l u s as at 30th June, 1S>90 10,616.50 • Stg. \ * v * ']: m ■ ( • ; m m ^ * * m m m * y ' ' ' 176,494.33 A ppendix X V (87) M r R onald M arkham & M s Jean Peterson 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Ronald Markham and Ms Jean Peterson. a) Letter of 14 March 1986 - GMCT to Guinness and Mahon. b) Guinness and Mahon Credit Committee memorandum of 6 February 1987. c) Guinness and Mahon Credit Committee memorandum of 25 October 1986. d) Guinness and Mahon of 16 June 1986 - GMCT re Markham No 2. e) Guinness and Mahon statement of 20 May 1986 - GMCT re Markham. • GUINNESS M A H O N ; Q & M A N ' A Member of tho Quft meee Mahon Mer chant Banki ng Qr oup Tel apl i ons No (8 0 0 4 4 ) 04663/4 Totex TRUST U M l T g D ' 0 867 P.O . B K ' ' . . CP430S C a tt b Addraes Qutaneas ' • ' ’ . a m m l Caym an. • . . . BrtfcJi W as) Indira 14th March, 1.986 yourr»f ou r ml JA C : ee t i .) Mr. J. D. Traynor Guinness & Mahon Led. 17 Collage Green Dublin 2 IRELAND Dear Des, RONALD MARKHAM AND/OR JEAN PETERSON Reference our •telephone conversation, 1 enclose Promissory Note, in duplicate, for the abovenamed. ' Loan Agreement and Please execute the Loan Agreement and return one executed copy and a copy of the Promissory Note to Mr. Markham direct in Florida. 1 think it is right for him to have a direct contact from yourself. The address is in the Loan Agreement. As explained, Mr. Markham has opened an' Investment Agency account with ourselves and is injecting $1 million into it, and with this and the $1 million loan from yourselves is investing $2 million in the Guinness Mahon Global Strategy Pund - European Class. All investments purchased will be held by us in our name or to our order by Guinness Mahon, Guernsey. Ve will be backing your loan to the clients by an equivalent deposit from ourselves. The differential between the Interest race on the loan and deposit will be lj of IX, and 1 suggest we just arrange to pay you this differential every six months, as we will be paying the interest either from dividends on the investments or additions to the loan and deposit, or injection of further funds by Mr. Markham. Once the full investment is completed, which wo expect to be in-a week's time, 1 will have Mike Shield advise Pat O'Dwyer of the details and interest ■ ( I- - r . if 1. ijfc > ^If3' ’ !' I *1- 1 i- llH lU M f ilr * ; ■ 5* " mail...j..i.ii/cpntf ■ ^ 1'lp . V' ' V ji'ji-if > -. . _ jrtlrmsllon f’Tv*'Mo. 1 ■ 14th March, l$&6 Mr. J. D. Traynor rate*. The loan ahould be in two tranches, one US$230,000 as of today, and one of US$750,000 aa of next Friday. . Kind regards, c \ ) ends /“N 1. '4 ... « 4- i. O. Box 124, Sanibel, Florida, U.S.A. 3D R JSINfcaS/ CCUPATION: Equity Staka: Company Director. IIS APPLICATION: No C.B. Approval: Y n /N o Purm talon Obtalnad Data: N/A I w w / E xw iiloo / ftw tarttw c (M m » m ap p rop riate) VPE;..... L09R........................ .... .... AMOUNT: *Exi«lnfl faciiitia* ovuriaaf &45&flQ0...tja......... . HATE: .S J S 7 .3 S ____ ___ Sl,7M ,000,.............. F E E : .............. ............... Margin j% __ __________ ■M t i l t H t t M l M t H If n tw or Incraatad faellitla*, ta drawdown parm lttad prior to oompfatlon o f Mcurlty7 URPOSE/DRAWOOWN: Irpcptment purposes Y E S /N O ERT REVIEW OATES: 'JF FACILITIES: ) 4.5.1986 1 year 3 months. iOURCE O F REPAYMENT; Not stated. If additional o r welding facility. k w curity in ordar? JECURITY: Joint & Several Promissory Note • Funds held. - ’ Y E S /N O If No, giv« dataili n parataly. r * BACKGROUND NOTE/ OUTLINE O F PROPOSAL: We have received a telex from G .M .C.T. requesting that wa make this facility available for a period to 4th May, 198$. We have a corresponding deposit. Loan Recommended: 1 /* > Ronald Markham and/or Jean Peterson °* Box l2 9 ' Cradit Memorandum S u b m ltta d b y : P O 'D Sanibel, Florida 33967, U.A. E quity S ta k e b u s in e s s / o c c u p a tio n .- No C.B. A pproval: Yai/N o P arm inkin O btained Oat*: n /A Company Directors TH IS APPLICATION: Exttrwlon / RwteCkMXXX N M tM « a p p ro p iittt) T Y P E :.............WS®??.____ __ - ............ 'E x it i n g fa c illtta ovarlaaf AMOUNT: W .1 § ltl!S ft9 9 9 ________ RATE: ............... FEE: ...................... ............. .6 M. LIBOR »»••• ..................... If new o r IncrMMd faellltlat, is draw dow n parm lttad prior to com p tot Ion o f saourlty? PURPOSE/DRAWDOWN: r ^ r r ) Already drawn for Investment purposes ' Y E S /N O "N. REVIEW DATES: TERM O F FA CILITIES: Extension for one year 24.10.87 SOURCE O F REPAYMENT: Not stated. If additional o r axlttin* facility, b N curity In order? SECURITY: Joint & Several promissory note - Funds held. Y E S /lttX x If N o. ghra datail* M parataly. ■ i ) BACKGROUND N O TE / OUTLINE O F PROPOSAL: We have been requested by G.M.C.T. to extend the above loan for a period of one year. The account has been conducted In order. An interest differential of i% will continue to prevail. Related Facilities/Borrowers: (Balance or Lim it, w hldm w r. i* greater) CREOIT COMMITTEE x j: J* Ronald Mdrkham/Jean Peterson U.S.$I,200,000 Agpar ft Markham Construction U.S.$500,000 jit j /R ecom m ended BOARD Total Exponire: - U.S.SI,800,000 - ......... * - id.H G+M G U I N N E S S + M A H O N LTD ITCaOM Oi— «OyWI •« «- -- -1) „,T ) ) CUXNMCSS RAMON CAYMAN TKUST M MARKHAM NO 2 statsmnt PAM NO. U.S. DOLLAAS L E D G E R ofvsit otrasir own w m MJUNt* WMMOAH IMPMft •MUMCf MOUCHr PORMARO J TSO.000*00 ■0 ACCOUNT H0V«N«MT StNCC LAIT STI TIN(NT II— ll»iIILIIIHW W •OINNCSS MUON CAYNAN TAUST P 0 BOX M T OAANO CATNAN m i t i s n mist inoics ■'.PI: G+R/l ■ANxem G U I N N E S S + M A H O N LTD ffCMwliiMMhl r A t a M I M M M M M •aauw •ur CUXNHCSS MAHON CAVNA* TRUST U NMKHAN »*« U.S. H I U M sta t m w t no. L E D G E R ««»«• on>scT otpour « v I I 4 ^ ___ PABC NO. "■**" OTSIOIM ioHATM IWUSBAItl •IA1MCC MOUSHT POKUAItC •••?*:*; IHrOM.I ' _ NO ACCOUNT M V M N T SXNClilAST STaTINCMT . as I A Jl It' GUINNESS MAHON CAYMAN TRUST P 0 ton SIT 6BM0 CATMAN MirtsH msst imuus Appendix XV (88) Mr John A Masek 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John A Masek. a) Guinness and Mahon credit committee memorandum of 9 February 1988. b) Guinness and Mahon credit committee memorandum of 11 August 1987. c) Guinness and Mahon credit committee memorandum of 11 August 1987. d) Statement of 29 Feburary 1984 - GMCT re Masek. e) Letter of 29 August 1990 - Ansbacher Limited to Guinness and Mahon. f) Internal Guinness and Mahon memo of 25 June 1985 - Pat O’Dwyer to JD Traynor. Cradit M»rnor«iKjuin Subminad by: PQ'fl AOOHESS:c/o, John A. Masek, 1547, Gaylord Street, Denver, O BUSINESS/ OCCUPATION: Equity Staka: ado 80206, U.S.A. _ _ . 0*1 Drilling Co. THIS APPLICATION: N o. C.B. Approval: Yas/No Parmiiiion Obtained Dm: N /A >fXiWXWSlxxx 10*1*9 «f a p p ro p fitit! TYPE: . L o a n ........................................ AMOUNT: I.L B .T jM s M lS .............. "XSVkO klf UtBNKX a Mr Mil BATE: C 0 S t..a f...6 m ..f . FEE: ......M U .............. * 1% /..V , tv * ftt •» <_' f i t . T If iww or incraatad facilities, li drawdown ptrm ittad prior to com plttion o f security? PURPOSE/ORAWOOWN: Vorking capital - funds already taken up. Y E S /N O j \ f \\ TERM OF FACILITIES: REVIEW OATES: xtension for 6 months. 5th August, 1988 SOURCE OF REPAYMENT: iot stated. II additional or •xiiting facility, h ncurliy in order? SECURITY: itle Deeds to two drilling rigs, ecurlty considered adequate. V ES/.W «t If N o, g ivt details separately. BACKGROUND NOTE/ OUTLINE OF PROPOSAL: e have received a request f r o m G M C T to extend the loan for 6 months. We share the differential ith C .M .C .T . who have placed Hinds on deposit with us. We have beenfaTortned that a reduction may i forthcomign before the end of March, it is expected full repayment may be made within extension iriod requested. xtenslon recommended. ! Ralattd FacilitiM/Borrowari: lF“"vica or Limit, which**•» issraattr) ' CREDIT COMMITTEE Minuw.■i'::.!?..:,..................... .......... ; k b = = 4 _ _ ........ Raconvnandad BOARO ” Minun....... ........................... Dare.........3 / . V / . . 5 . . S . 'V • SPILLING CORPOHATION « C*0'l m c/c, John A. .Masek, 1547, Caylned Street, Denver, Colorado 80204, U.S.A. cS- 4&' OCCi ftTiON !CA oil Srillir.g Co. •••• SI ,68.4.,.84 4.^75... ............... E n u i t y S tu tu N'. i*t. >1 JfJVUllO'A" pn*Ti*:M p< 9" :n Ct'nplttMjr J* Sl*;r • .JfOAAWOOv.S - re 10 Ojic Nowfiwftfic#A«UM*tt£Ntf)nc 1-eniw •' f« » n « io .tQtWe it Mnranrmml AMOUNT. Sna>n-t,.«tl!iy ?v.rd3 alr«ady drawn »:3fe:fcCxx ■; >h T «? - i-sier. SO'. *.£ 3* * J ! - N ??' c RSVifcA R A -JS: Qf tAC'u * 53 2?? o *t:- "«:u-:ar>-, 1992 •■ncnt'rs stased I4ccW<:tfr.' •iT> 1« 2eeds to two drilling rijs. ur:iy czr.f. a d e q u a te . v «S l‘ No. ijivi- /*■* BA HOcx ( w r jiu lv . G30LN0 \ C ~ i . iNt op p r o p o s a l. a r Thl> i<5a" o«*n a t th* r e q u e s t of GXCT who have placed funds on deposit with us and ki:!i whoa ve share cho 9ir.. This loan is ir. the offset category, Wa have beers os'*:od fev Gmct le 1 ovftr capital plus interest for a period of 6 ir.onthrj. * E er.aion rsccrr,tendedj cu CREDIT COMMITTER -a Fie ■«*I» 1 mi). * * W . H •!grujterl in A. $2 ,444,44. cxom ..-., $4,129,459.22 SCA«0 O ' - f Z :S£2,887.731 A/ AAf l * _ ..... •JAr K ELLY DRILLING CORPORATION WftGlt fl*tmui«nuun» Submitted by: -□ORES. c/0 Joh»v A. Masek, 1547 Gaylord St, Denver, Colorado 80206. USA. Equity Staka: NO C.B. Approval: Ytt/No Permwion Obtalnad Data: N/A BUSINESS-' OCCUPATION: Oil Drilling Company. "HlS APPLICATION; "YPE: Loan i Srfw Ninn6aR*K*ftJMitlOMft&N)tKV ' Increaie / Extention /ftolMOfMKK !D*ttn U tpproorhnt) AMOUNT: 81.884,644.75 {1% differential) If new or increatad fadlitiet, it drawdown permitted prior to completion of racurity? 3UpP4SE DRAWDOWN: Working capital - funds already drawn. YES NO REVIEW OATES: r =RM OF FACILITIES: Extension for 6 months. 5th Feb ’88 SOURCE Of REPAYMENT: Not stated. SECURITY: If additional or cxiicng facility, i« Mcurity in order? Title Deed* to two drilling rigs Security considered adequate. YES/WOC If No, gl»e details teparately. 3ACKGROUNO NOTE/ OUTLINE OF PROPOSAL: We nave been asked by G.M .C.T. to roll over capital plus interest for a period of 6 months. The company is hopeful that the borrowing will be reduced within the extension period being requested. Extension recommended. CREDIT COMMITTEE RejjUjcl Facihtw Borrowers: \$T ' m or Limit, whichever i» greater] *„ j>,^ y Minula.../)?^.™.............. Dan..... John A. Masek $ 2.444,514.47 .............................. Recommended BOARD ~ Pleasereplyto; 42FitrwflliamSquare, Dublin2. P.O. B n M7, Ofaad O yn u, Brilfch W«t U fa Fhoo* (IN) MM03/4 Triec CP 4305 Hue (*») MS-79* (M9)NMJ67 TW; 765144/763065 Fax; 612035 H. David Humphries, E s q ., S e n io r Manager - O p e ra tio n s, Guinness ft Mahon L im ite d , 17 C o lle g e Green, PPBLXM 2. 29th August, 1990 Dear D avid , I th in k my v i s i t yesterday has f i n a l l y sorted out the o utstan d in g p o in ts in yo ur l e t t e r o f the 13th August. (a ) I l e f t w ith you copy statement showing d if f e r e n t va lu e dates re A$200,000. You w i l l have a d ju s te d . (b ) D .P .C . i s opening a new A/A26 S t e r lin g Account. Someone w i l l r in g o r h is S e c re ta ry , M ary, each Thursday morning g iv in g a note of In te r e s t accrued. (c ) I went through w ith M a rtin th e John Masek f i l e , as a r e s u lt o f which he i s l e t t i n g me have some docum entation. (d ) We agreed th a t you would e lim in a te "blocked a c co u n t". ^ you w i l l o f course ensure th a t the va rio u s accounts remain e f f e c t iv e ly blocked. MSny thanks f o r your h e lp . yours s in c e r e ly . J . D . Tra v n o r AppendiijY' m e m o r a n d u m To: Mr. J. D. Traynor. 25th June, I98S. Kelly Driling/Maaek Kelly Drilli ng Loan SI, 261,925,69 124°o . 15th November, 1985 JOHN MASEK Si. 108,510.00 I2«i 7th February, 1986 S 652,240.59 14% 13th September, 1985 S 242.66o.09 10.575% 1 show above batance* of loans V H V P M R No further developments since the end of March. No reply received in answer to your letter dated 18th April, 1985. PO'D/SC A ppendix X V (89) M r Basil M aw dsley 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Basil Mawdsley. a) Transcript of evidence of Mr Basil Mawdsley dated 28 November 2000. b) Telefax of 23 March 1995 - Ansbacher Cayman Limited to Padraig Collery. c) Facsimile of 20 July 1994 - Joan Williams to Cayman International Bank and Trust Company Limited. d) Internal Guinness and Mahon memo of 27 November 1986 - JD Traynor to Padraig Collery. e) Internal Guinness and Mahon memo of 2 November 1984 - Joan Williams to Padraig Collery. f) Letter of 22 May 2000 - Basil Mawdsley to the Solicitor to the Inspectors. g) Letter of 14 May 1982 - Joan Williams to B McL. h) Guinness and Mahon statement of 31 January 1981 - GMCT re Coral. i) Guinness and Mahon statement of 28 February 1981 - GMCT re Coral. j) Guinness and Mahon statement of 20 March 1981 - GMCT re Coral. k) Letter of 19 March 1982 - JD traynor to Basil Mawdsley. 1) Internal Guinness and Mahon memo of 16 February 1982 - Joan Williams to Padraig Collery. m) Statement of account of 15 July 1981 addressed to Basil Mawdsley. n) Internal Guinness and Mahon memo of 5 January 1982 - JD Traynor to Padraig Collery. o) Statement of a/c of 1 December 1995 with handwritten ledger statement re A/A 15 of 2 May 1997. p) Statement of Hamilton Ross account A/A dated 2 May 1997. UNDER OATH ON TUESDAY, 28TH NOVEMBER 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. ROWAN FCA MS. M A C K E Y BL S o l i c i t o r to t h e I n s p e c t o r s MS. M. C U M M I N S Interviewee: MR. BASIL MAWDSLEY WITNESS EXAMINATION MR. B. MAWDSLEY M S . MACKEY PAGE 5 - 3 7 M R . ROWAN 38 - 48 M S . MACKEY 49 - 50 1 2 3 4 MS. MACKEY: 5 6 Perhaps, we could get underway now? MR. ROWAN: 7 Yes. Mr. Mawdsley, my name is Paul Rowan. 8 is my fellow Inspector, Ms. Noreen Mackey. 9 already met our solicitor, Ms. Mary Cummins. 10 MR. MAWDSLEY: Yes. 11 MR. ROWAN: At the outset, 12 This You have I would like to explain that this 13 is not a court or a Tribunal -- it is an interview 14 -- so that we would be posing questions of you. 15 you at any stage need time to think about the answer 16 or to refer to a document, please ask us to allow 17 you to do that. 18 MR. MAWDSLEY: Right. 19 MR. ROWAN: We are going to keep a 20 If record of the interview so 21 that at some stage later you will be given an 22 opportunity to consider the written record and in 23 due course, perhaps, to sign it. 24 MR. MAWDSLEY: Okay. 25 MR. ROWAN: So with that introduction, 26 27 28 29 Ms. Mackey would like to ask you some questions. 1 2 MR. ROWAN: Yes, indeed. 3 4 5 MR. MAWDSLEY, HAVING BEEN SWORN, WAS EXAMINED BY 6 MS. MACKEY AS FOLLOWS 7 8 1 Q. MS. MACKEY: Now, Mr. Mawdsley, you 9 sent us a statement, which 10 is helpful. 11 A. 12 2 Q. 13 A. 14 3 Q. 15 A. 16 4 Q. 17 A. 18 5 Q. Do you have a copy of it with you? Yes, I have got it somewhere in here. We can give you a copy...(INTERJECTION) No, it's alright. I will in due course...(INTERJECTION) I have the original somewhere. In due course, I will go through that. Yes. Now, just for the record, before we begin to go into 19 that, if you could give me a little background about 20 yourself, Mr. Mawdsley and your career. 21 still in business or are you retired? 22 A. 23 Are you No, I retired from commercial business in the late 80 's . 24 6 Q. 25 A. What was your business prior to that? I was the last group finance director of the House 26 of Fraser group which has come into prominence 27 because of, firstly, the DTI Inquiry into whether it 28 was their money or the Sultan of Brunei's money and 29 various antics of Mohammed A1 Fayed wanting British 1 citizenship subsequent to the late Princess of Wales 2 and his son being killed in Paris. 3 7 Q 4 A So you were a group director? Yes, I was a group director prior to it losing its 5 independence. 6 and after the bid. 7 8 Q I was actually there before, during, Had you other business interests prior to that or during that? 8 9 A 10 9 Q 11 A 12 No. Any other companies with which you are connected? No, I was a group director and responsible for, you know, the whole span of things. 13 10 Q 14 A 15 Were you on the board of any other companies? No. I was on the board of one or two major subsidiaries. 16 11 Q 17 A Can you give me the names of those? Yes, House of Fraser Stall. That was a major 18 subsidiary. 19 one or two of the smaller ones because they got rid 20 of shareholding belonging to LONRHO. 21 12 Q 22 23 I wasn't a director of Harrods. And So you were a director of about three companies or four? A Well, my principal job was group finance director. 24 That usually involves you being involved with some 25 of the major subsidiaries; not necessarily as a 26 director -- you may sit on the management committees 27 or whatever structure they may choose to adopt. 28 This isn't unusual for somebody in my sort of 29 position. 1 13 Q 2 A Yes, in the early 90's, I did a quango type job. I 3 was a deputy director of the Heritage Memorial Fund 4 which has been subsumed into the Lottery, which is, 5 in money terms, quite vast compared with the sort of 6 thing I was dealing with. 7 14 Q That is fine for the background, Mr. Mawdsley. 8 maybe, we can get down to the actual statement 9 (EXHIBIT 1) and what we are looking at at the So, 10 moment. 11 affairs of Ansbacher Cayman, Cayman Island Company, 12 which was operating in Ireland to an extent. 13 company was also known as Guinness Mahon Cayman 14 Trust during the 1980's. 15 that you are familiar with it? 16 A 17 18 15 Q It may be by that name No, I didn't hear about it. I knew Guinness Mahon Well, we will come to that. Perhaps, you would like to...(INTERJECTION)? A 21 22 This in...(INTERJECTION). 19 20 As you know, we are investigating the You know, where it started -- what it then...(INTERJECTION). 16 Q Yes. If I could just ask you specific questions, we 23 can probably get through the whole thing fairly 24 quickly. 25 by saying that you met Mr. Traynor occasionally from 26 1973 to the late 80's. 27 first met Mr. Traynor? 28 Yes, I met him in the context of disposing of some 29 shares. You start off your statement (EXHIBIT 1) Can you tell me how you It would, frankly, be petty cash terms in 1 2 17 Q. 3 A. 4 18 Q. 5 A. How did you meet him? Who introduced you? I think he introduced himself. Where was this or how did you come across him? Well, I was then a director of another group, not Fraser, which had...(INTERJECTION). 6 7 19 Q. What group was that? 8 A. It is called Tunnel. 9 20 Q. 10 A. 11 21 Q. 12 A. 13 Tunnel? T-u-n-n-e-1, yes. Tunnel Holdings? It later became Tunnel Holdings. It was at that time Tunnel Cement Limited. 14 22 Q. 15 A. What was Tunnel? Exactly what it says. It had three cement works in 16 Britain. 17 those days were considered legit before the asbestos 18 scare, you know. 19 23 Q. 20 A. 21 24 Q. 22 A. 23 25 Q. 24 A. It made asbestos cement products, which in Yes? And a variety of minor investments here and there. So you were a director of this Tunnel Company? Yes. Tunnel as it was then? And it held a small percentage, but a significant 25 percentage, in Cement Roadstone Holdings as it then 26 was -- CRH as it has now become. 27 2 6 Q. 28 A. 29 Roughly, what percentage did it hold? I can't remember, frankly, but it was probably 1 27 Q 2 28 Q Tunnel was repositioning itself. It had got into 3 deep financial straits. 4 project. 5 controls were inadequate and unauthorized additional 6 costs were being incurred down the line instead of, 7 you know, the top Board being consulted about 8 whether they wanted to commit themselves to whatever 9 it was -- huge amounts of money. 10 11 It is not an unfamiliar story because the 29 Q Was it in this context that you came in contact with Mr. Traynor? A There was a debenture that also prescribed financial 14 constraints. 15 bumping on the ceiling. 16 30 Q 17 18 So it was up against its banking limits. 12 13 It had overspent on a major We were in some danger of sort of Could we, without getting into too much detail...(INTERJECTION)? A No, I am trying to explain the next step in which 19 Mr. Traynor appeared was necessary. 20 realise something. 21 was ready money, frankly. 22 I can't remember what we got for the shares. 23 in the low millions. 24 31 Q 25 A We had to This was one of the things that It was a listed company. It was So you were selling the shares in Tunnel? No, not in Tunnel. Tunnel shares in CRH were sold 26 to raise money for the regeneration needs of Tunnel 27 Cement, as it then was -- with one or two others, I 28 have to say. 29 They weren't alone in it. 1 2 I can't remember who did it or when or how but I am 3 quite sure in those days it would -- it might not 4 happen in quite as friendly a manner these days but 5 there would have been some intimation to CRH that we 6 were getting out of this thing and why. 7 people, you know, were periodically, as was Des 8 Traynor, at various conferences on the construction 9 industry and on this, that, and the other which are Their 10 frequently held -- still are. 11 to me because I was given a job of getting rid of 12 these things. 13 33 Q 14 15 He made himself known So was Mr. Traynor at that time a director of CRH -­ of Cement Roadstone Holdings? A I don't know was he a director of it but, certainly, 16 I was obviously satisfied that he was speaking in an 17 authenticated manner on behalf of the CRH Board. 18 The plea, in short, was that instead of hauling them 19 around, which they preferred we didn't, we would ask 20 our brokers to liaise with -- I think it was him -­ 21 to see that they were sold to what are known as 22 friendly hands. 23 34 Q Perhaps, if we could short-circuit this a little 24 bit, Mr. Mawdsley. 25 questions rather than get...(INTERJECTION)? 26 A 27 35 Q 28 A 29 36 Q If I can ask you some specific That is how I met Des Traynor. You met him on that occasion? And I arranged that our brokers...(INTERJECTION). Sorry, I don't want to interrupt you, Mr. Mawdsley, 1 but I would like to ask you specific questions, if I 2 might? 3 A. 4 37 Q. 5 You met him, anyway, in 1973 as a result of the sale of these shares? 6 A. 7 38 Q. No, I would say late 70's. I can't be specific. Well, you say in your statement (EXHIBIT 1) that you knew him from 73...(INTERJECTION)? 8 9 Specific -- fire away. A. 10 Yes, I am guessing. But it was probably in the middle to second half of the 70's. 11 39 Q. 12 A. 13 40 Q. 14 When you sold the shares? I can't be exact about it. On that occasion, did he mention to you that he had this offshore vehicle? 15 A. 16 41 Q. 17 A. 18 No. Did you keep in contact with him after that? No, I don't think he did. We met each other now and then. 19 42 Q. 20 A. At various sort of industry things, you know? 21 A. Yes? 22 A. He had said to me at some stage that because he How did that arise? 23 understood why we were getting out of CRH, he 24 understood what the group were trying to do. 25 of my job was looking for the relevant acquisitions 26 or developments to get away from, basically, the 27 commercial problems that had caused Tunnel to get 28 into difficulties. 29 43 Q. Part When did he first mention this offshore vehicle, do 1 2 3 44 Q. 4 5 occasion? A. 6 7 Can you tell me exactly what he said on that I think I had dinner with him in a hotel somewhere around Grosvenor Square. 45 Q. 8 Well, your location does not matter. What did he actually say? 9 A. 10 46 Q. 11 A. No, no, he used this place, I think, regularly. What did he actually say to you? We were talking about all sorts of things. He said: 12 'If you ever want to shelter anything, just have a 13 word with me and I might be able to help you' or 14 words to that effect. 15 47 Q. 16 shelter anything? 17 A. 18 48 Q. 19 A. 20 49 Q. 21 A. 22 50 Q. 23 A. 24 51 Q. 25 26 What did you understand by that -- if you want to Well, anything outside the UK. But shelter from what? UK tax. That is what you understood that to mean? Oh, yes. And he said that? He knew what he was saying, yes. Did he describe to you the means by which this could be done? A. No, but having read all this -- I mean there are 27 more legs on this than there are on a cupboard full 28 of spiders. 29 52 Q. Forgetting for the moment what you now know, what 1 2 3 A. He said something like, you know: We have got 4 companies all over the place. 5 there was a mention of exchange controls in Eire, 6 which I wasn't aware of then and I can't remember 7 what they are now. 8 53 Q. 9 Did he mention the Cayman Islands as being the location? 10 A. 11 54 Q. 12 A. 13 55 Q. 14 A. 15 16 I think at some stage No. Did he mention the Channel Islands? No. He did say it was offshore however, did he? The inference was that it was offshore the UK. That didn't necessarily mean it was outside Eire. 56 Q. Did he mention that it would be connected with a 17 subsidiary of the bank with which he was connected 18 in Ireland, Guinness Mahon? 19 A. 20 57 Q. 21 A. No. Did he mention that at all? Well, he said we have companies, you know, doing 22 this, that, and the other all over -- that can do 23 anything. 24 58 Q. 25 Ireland? 26 A. 27 59 Q. 28 29 You understood he was connected with the bank in Oh, absolutely, yes. Now, did he discuss the setting up of a trust with you? 1 frankly, in a professional sense, I wouldn't touch 2 with a ten foot pole because...(INTERJECTION). 3 60 Q. 4 A. 5 61 Q. So he didn't mention trusts? No. He didn't suggest that you could set up a discretionary trust? 6 7 A. 8 62 Q. 9 No, nothing like that. Did he suggest that you could set up an offshore company or that he would set one up for you? 10 A. 11 63 Q. 12 A. No. He didn't? He was a banker. You know, every banking group has 13 got... 14 certainly, most banking groups now have got 15 facilities in Jersey, Guernsey, the Isle of 16 Man...(INTERJECTION). 17 64 Q. Maybe, not everyone in those days but, Can I refer you again to your statement (EXHIBIT 1) 18 here, the second paragraph, Mr. Mawdsley. 19 you gained from him... You said "I then gained from him the strong impression that it was held by an offshore Guinness Mahon subsidiary" 20 21 22 23 A. 24 65 Q. Yes. Now, prior to that you said in the previous sentence 25 you had money paid directly to an account number he 26 provided at Guinness Mahon? 27 A. 28 29 Yes, I have sent you details of this. You have got copies of both the original and...(INTERJECTION). 66 Q. I know we have the documents. When did he give you 1 2 3 It must have been about 20 years ago. 67 Q So when you had this discussion with him in London, 4 was all this arranged at that meeting or did you 5 have a meeting specifically to set it up 6 subsequently? 7 A No, it was just an offer he made. We were talking about all sorts o f ...(INTERJECTION). 8 9 68 Q 10 A 11 69 Q 12 A 13 70 Q 14 A 15 When did you take up that offer? Again, I would say about 20 years ago. So...(INTERJECTION) There was a gap...(INTERJECTION). We are talking about the 1980's? If you are trying to determine were the two things coincidental 16 71 Q 17 A Yes ? The answer is no. I knew they had this facility and 18 I can't tell you how soon after hearing about it I 19 actually took it up. 20 ago. 21 72 Q It is twenty-something years So, in fact, some time passed by and then was it you 22 who decided yourself: 23 will contact Mr. Traynor? 24 A 25 73 Q 26 A 27 74 Q 28 A 29 75 Q Yes, I will avail of this; I Yes . So you contacted him in Dublin? Yes . Did you arrange to meet him on that occasion? I don't think so. So did you transact your business on the phone then? 15 1 Yes, I told him simplistically I wish to avail 2 myself of this particular feature and it went from 3 there. 4 76 Q 5 6 from there. A 7 8 What I want now is to get details of how it went I mean, what...(INTERJECTION)? I caused money to be paid to whatever account he told me. 77 Q 9 I understand that but I want to find out exactly how this happened. When you spoke to him on the phone 10 you said: I want to avail of the offer. 11 referred to the previous conversation, 12 that you had had and you said you would like to 13 avail of this. 14 funds that I wish to place in this...(INTERJECTION)? So did you say: You I suppose, I have X amount of 15 A 16 78 Q What did he say then you should do? 17 A He gave me some banking directions. Well, I said some money could be paid into it. I don't know 18 whether there was a clearing number but, certainly, 19 there would be an account number. 20 like paying an electricity bill. 21 into a certain code with an account number. 22 79 Q 23 A 24 25 80 Q So he gave you all this on the telephone? Yes, I think so. I don't recall actually getting it Was the account number that he gave you in a bank in London? A I have no idea. paper. 28 29 You have to pay it on paper. 26 27 You know, it is 81 Q It is an account number on a bit of You know, he was a banker...(INTERJECTION) 1 2 82 Q What did you do, though, with the funds? Did you 3 bring them into a bank somewhere or did you send 4 them to him or did you go to meet him? 5 A suggested. 6 7 83 Q A 10 84 Q 12 A 13 85 Q 14 A Yes, it was paid by a bank transfer of some sort, So you went to your own bank, which was where? No. So what did you do? I instructed the source of this money to pay it to wherever Des Traynor told me. 15 86 Q So the funds were already offshore; was that the 17 situation? 18 the...(INTERJECTION)? 19 A Yes. And you instructed them to be moved to It is no different from sending, you know, £1,000 to somewhere if you are going on holiday. 20 21 Did you just do it yes . 11 16 Yes, but how did you cause them? by bank transfer? 8 9 I have said I caused them to be paid to wherever he 87 Q I understand, yes. I wanted to see whether it was a 22 question of meeting Des Traynor and physically 23 giving him funds or not? 24 A 25 88 Q No, I didn't hand any money over like that. You say you had it paid directly to an account 26 number he provided at Guinness Mahon. 27 Guinness Mahon in Dublin or Guinness Mahon & C o . in 28 London? 29 I couldn't tell you but I suspect in the 17 Was that 1 circumstances it must have been the main Dublin Bank 2 89 Q 3 A 4 90 Q 5 A 6 7 91 Q College Green, yes. ...or whatever it was called then, which they Well, no, they didn't shift it. It stayed in Dublin but they had a subsidiary in the Caymans. A 10 Yes, that is what I meant. They transferred it, it seems now in retrospect...(INTERJECTION) 11 92 Q 12 A 13 14 Guinness & Mahon Ltd. Ireland...(INTERJECTION) shifted out to something else, evidently. 8 9 Branch. Transferred the money? They transferred offshore from Ireland into one of these innumerable outfits. 93 Q You then say that you gained from him the strong 15 impression that it was held by an offshore Guinness 16 Mahon subsidiary? 17 A 18 94 Q 19 20 A Well, that was the inference when he mentioned it for the first time when we met for a meal somewhere. 95 Q 23 24 So you, apparently, did gain that impression at the time? 21 22 Yes . So you weren't under the illusion that it was going to be in Dublin? A No, no. I mean, it was clear that this little 25 banking group -- and I don't even know who owned it 26 at the time -- had various parking places, let's 27 say. 28 96 Q 29 A Yes, around the world. And the Dublin office clearly was a front or 18 1 conduit, if you like. 2 backwards, 3 then and that was it. 4 97 Q What went on from Dublin I was not privy to. I trusted him by You also say that you understood that by prior 5 arrangement cash could be drawn from this offshore 6 subsidiary. 7 A 8 98 Q 9 A 10 11 Now, what gave you that understanding? He told me that. What did Mr. Traynor say? He said you can have a cash advance which will filter through to where the account actually is. 99 Q So just to be clear what he said to you, did you 12 understand that he would advance you money from 13 Dublin? 14 A 15 where could be made available in the UK. 16 100 Q 17 A 18 101 Q 19 A 20 21 In the UK? Yes . Did he explain how that could be done? Yes, I wish to tell him if I wanted something and he would tell me where to collect it. 102 Q 22 23 No, he could arrange that an element of whatever was You didn't know how he was managing to have it there in that place, did you? A Well, it was clearly netted off where-ever this 24 basic deposit was lying at the time through the 25 internal books of Guinness Mahon. 26 intra group transactions between the various 27 subsidiaries. 28 So he told you that if you wished to do this you 29 should contact him? All groups have This is no different. 1 2 104 Q 3 A 4 105 Q 5 6 Yes . Would you contact him by phone or would you write to him or...(INTERJECTION)? A No, I am almost certain it was entirely by phone. 7 only met him, you know, four or five times in my 8 lif e . 9 106 Q 10 So you would contact him or you would speak to his secretary, Ms. Williams? 11 A 12 107 Q 13 And ask him to ring me. You would explain to him what you required at that time? 14 A 15 108 Q 16 Yes . What would happen then? Would he tell you where it could be collected or? 17 A 18 109 Q 19 20 I Yes . Would it be lodged to your account in your own bank or how would it be done? A 21 No, I collected it in cash from only two addresses. One was a Guinness Mahon office. 22 110 Q 23 A 24 111 Q 25 A Is it St. Mary's Hill or something like that. 26 112 Q St. Mary's Hill, you think it was, in London? 27 A 28 113 Q 29 A In London? In the city. Can you remember the address of that office? Yes . That was one address; where was the second? The other one was Ansbacher's own bank near the -- I 1 2 114 Q 3 A 4 115 Q Ansbacher itself? Yes . You would go there. Would you introduce yourself? 5 Was there someone you had to meet or how was it 6 done ? 7 A It worked that it would be convenient, say, a week 8 today, you know, at eleven o'clock if I was in the 9 city or near the city to go and see whoever he told 10 me to and that was it. 11 116 Q 12 A 13 117 Q 14 A 15 118 Q 16 A He would give you a name? Yes . Can you recollect the names of the people? No, I can't. Either of them or any of them? No, the original arrangement was that it was in an 17 envelope and I produced something to say who I was 18 and I asked for an envelope and that was it. 19 turned up at the office and produced some recognised 20 piece of identification. 21 119 Q 22 A 23 120 Q 25 A Whatever I had asked Des Traynor to provide A similar system worked at Ansbacher's. I see? But I am blowed if I remember the name of ...(INTERJECTION) 26 27 121 Q 28 A 29 And an envelope with cash was provided? appeared. 24 I The person. I am not too sure if it is the same person all the time . 1 122 Q 2 You can't remember any name of anyone at all? 3 A 4 123 Q 5 A No, and I haven't got a note to tell me either. Never mind? That is what makes me think it probably varied from transaction to transaction. 6 7 124 Q 8 A 9 125 Q 10 11 It may not have been. Probably, yes. There weren't that many occasions. But, essentially, you had to identify yourself and an envelope would be provided with your name on it? A Yes, it wasn't a pressure matter for me. You know, 12 I could fit in with... 13 out of the country. 14 extensively and I just waited until he was back. 15 126 Q He was occasionally away or He travelled, at times, quite During all that period when you were able to 16 withdraw money when you wished, did you make any 17 further lodgments to this account? 18 A 19 127 Q 20 A 21 Yes, I had some money going into it. On a regular basis? From time to time. Look, we are taking a turn into something I, maybe, should have raised at first. 22 128 Q 23 A Yes? That, on advice, I wish to take advantage of the 24 offer in paragraph 1 of your letter (EXHIBIT 2) to 25 me of whatever it was -- 4th May -- to erase from 26 any documents and records some of this information 27 that we are getting into now. 28 told you that I had money paid into an offshore 29 account. The fact is I have I have told you how it was 1 offered/originated and the mechanism by which it 2 worked. 3 129 Q. 4 A. 5 Yes, that's right? I have not had any money paid into that for a considerable number of years. 6 130 Q. 7 A. 8 131 Q. 9 A. 10 132 Q. 11 A. Fine -- that's grand. And can we leave it at that. Yes. May I have your undertaking that...(INTERJECTION). I'm sorry, I don't understand. In the event that any of this comes out that the 12 information in my statement relating to the account 13 I may have received or endured etc. etc. will be 14 expunged from the documents and records 15 and...(INTERJECTION). 16 133 Q. I am afraid we can't give any such undertaking. 17 you reading something from the letter we wrote to 18 you there? 19 A. 20 134 Q. Yes. Maybe, I am misunderstanding you. I think that was 21 simply that you needn't give us information as to 22 figures ? 23 A. 24 135 Q. 25 A. Are Well, I haven't. Is all that that we. . . If it is good enough to admit from an unsworn 26 statement, it should be good enough to admit from a 27 sworn one. 28 29 136 Q. I am afraid we can't erase anything that you say 1 whatsoever. 2 about but I am not asking you to...(INTERJECTION)? 3 I am confirming the fact that there were more than 4 one...(INTERJECTION). 5 137 Q 6 A 7 138 Q 8 A 9 139 Q 10 A 11 It is simply figures we are talking Lodgment. Lodgment in...(INTERJECTION) I am not asking you at all for...(INTERJECTION)? Wherever it went to, you know? Of course. It seems to me it has probably been in two places, the second one being where it would be now if... 12 140 Q Yes. Is that account still in existence? 13 A Yes. Well, it i s ...(INTERJECTION). 14 141 Q 15 A You haven't closed it? No, I have not touched it. I have not been in touch 16 with these people since about 1995 and I became a 17 pension, a legal pension -- a State pensioner in 18 1995 and I took the view that I should get my 19 affairs in an orderly state. 20 but I can't remember -- can you tell me when 21 Mr. Traynor actually died. 22 142 Q 23 A 24 25 In 1994. Well, that explains it because I found myself talking to people who didn't know what I was asking. 143 Q 26 27 Amongst them was this Well, you were put, I think, in touch with Mr. Collery, as you tell us here? A I then found Mr. Collery, yes. He subsequently 28 disappeared from the number at which I customarily 29 called Des Traynor. It has been static from the 1 2 144 Q 3 4 present situation? A 5 6 Well, I will take a view on that when I know that it is freed from the Haughey Lowry Inquiry. 145 Q 7 8 Do you intend to do anything about it or what is the Well, our one is different. We are not the Haughey Lowry Inquiry. A 9 Yes, I know, but this has come out of this. I do not know the extent to which you have seen the 10 papers from this relating to the questions I have 11 been asked. 12 Hamilton Ross, Ansbacher Cayman, which I didn't know 13 about until very recently -- formerly Guinness Mahon 14 Cayman Trust. 15 and Hamilton Ross -- that was another letter about 16 these things, the proposed order against the Bank of 17 Ireland. 18 146 Q 19 But I have denied any connection with Overseas nominees, Ansbacher Cayman We understand you don't know anything about any of those? 20 A 21 147 Q No. You have explained to us that you understood that 22 this was being sheltered -- that that was the 23 purpose of the whole thing? 24 A 25 148 Q 26 Can I take it then that, in fact, you did not disclose the interest that accrued on this fund? 27 A 28 149 Q 29 Well, that was very clear. I didn't remit any interest to the UK. Fine. Well, those are all the facts that we need to get, Mr. Mawdsley. There are just a number of small 1 things that I wanted to go through with you arising 2 from documents and so on you sent us just to clear 3 up odds and ends? 4 Yes . 5 150 Q I think we have actually covered most of them... 6 Yes, can you tell me anything about a company called 7 Coral? 8 A 9 10 think that is the sort of answer you want. 151 Q 11 No, I don't think that is the Coral I am talking about. 12 A 13 152 Q 14 A 15 16 It is a bookmaking business in Britain but I don't Coral in connection with your own account? No, I know nothing about Coral. You know nothing about it? No, as I said in the letter, most of these names, you know, are completely foreign to me. 153 Q 17 Can I ask you to look at a document, Mr. Mawdsley. This is an internal Guinness Mahon memo 18 A 19 154 Q (EXHIBIT 3). Yes . You see there it is dated 14th May 1982. It is 20 A.J.W, which is Joan Williams, to B.McL. I am not 21 sure who B.McL is but it is some official in 22 Guinness and Mahon: 23 "I have today received a request from Mr. Mawdsley that we transfer...(INTERJECTION)" 24 25 26 A 27 155 Q 28 A Yes . 29 156 Q Now: Yes, okay. And you see the...(INTERJECTION) 1 "...and indicated as being for credit (Mr. Mawdsley). If of account .... possible, it would be appreciated if this could be sent to..." 2 3 4 We will just wait a moment because there is some 5 coffee coming in. 6 Sure. 7 157 Q 8 A 9 158 Q This is a short-term...(INTERJECTION) We will just wait a moment. But I have never heard of Coral. Now, we had intended initially to break for coffee 10 but I don't think there is any need because we are 11 pretty near the end so we will just have coffee 12 while we are going on if that is alright with you? 13 A 14 159 Q Do continue, please. And we can finish quicker. Now, I was asking you 15 about a company called Coral, Mr. Mawdsley, and here 16 we have an internal message from Guinness and Mahon 17 (EXHIBIT 3) saying that you have requested transfer 18 of funds to a particular place and these funds, the 19 memo notes, are to be debited to Guinness Mahon 20 Cayman Trust account re Coral ? 21 A 22 160 Q It appears to be that you are directing money to be debited to that particular account? 23 24 I am sorry, I can't ...(INTERJECTION). A Yes, I do not know what it was. 25 I have never seen Coral. 26 these numbers. 27 28 29 161 Q This is news to me. I don't recognize any of Can you recollect this transfer or what Bache Halsey Stuart Shields Inc...(INTERJECTION)? 1 162 Q 2 A 3 163 Q 4 5 Yes . But you cannot explain the debit to Guinness Mahon Cayman Trust? A No, no, this is behind the front that only 6 Mr. Traynor knew what was behind it. 7 about where it went or the name of the companies. 8 164 Q 9 10 11 12 Can I just show you a couple of statements of Guinness Mahon Cayman Trust account. A I knew nothing It is Tab 5. I should make it clear that I never had a regular statement from them. 165 Q Yes. Well, that would be par for the course. Now, 13 these are statements from Guinness Mahon itself in 14 Dublin. 15 corner the address of the bank (EXHIBIT 4). 16 A 17 16 6 Q 18 You will see up in the top right-hand Yes . But it is the account of Guinness Mahon Cayman Trust Ltd. re Coral? 19 A 20 167 Q 21 A 22 168 Q 23 A Designated Coral. And it is in US Dollars? Yes . Did you have a US Dollar account? Yes, I think one thing Des Traynor offered was 24 because of various investment lines Tunnel was 25 following, 26 the biggest free market -- don't forget this is 20 27 years ago. 28 rest of it. 29 from what it is today. some of which were in the States -- it is The USSR hadn't collapsed and all the It is a very different commercial world I remember he used to have a 1 question for training courses to deal with if I lend 2 you some money in US Dollars, what are you going to 3 put it into because I want it back in US Dollars but 4 you have got to make something on it in the 5 meantime. 6 169 Q 7 A So you had foreign currency accounts? No, I knowingly changed, I think, Sterling into US 8 Dollars at some stage because it came out of a 9 conversation he and I had about the relative 10 strengths and weaknesses of Sterling versus the US 11 Dollar or the other way around -- I can't remember 12 which way it went anyway. 13 bearing on what I did with whatever was in here. 14 This is some time ago, isn't it. 15 170 Q 16 Would you accept now that, in fact, this account in the name of Coral is, in fact, your account? 17 A 18 171 Q 19 A 20 172 Q 21 22 The conclusion had some Yes, but I was not aware of that at the time. I understand you weren't aware at the time? Of the internal designation these things carry. Of course. Now, can I ask you to look at another document -- 59 and 60 (EXHIBIT 5)? A One of these appendices does actually recite fairly 23 comprehensively the... 24 that is. 25 173 Q 26 A It is page 12 of C, I think, Our letter (EXHIBIT 2)? Yes, the attachment to it. The preamble to 27 paragraph 2 really is most pertinent to this. 28 have never heard of Amien Securities or all that lot 29 -- Kentford and so on and so forth. I 1 174 Q. We understand that. I understand absolutely that 2 you haven't heard of any of those names. 3 like you to look at this letter now, Mr. Mawdsley, 4 which is to you from Mr. Traynor on 19th March 1982. 5 Just have a read of it there (EXHIBIT 5)? 6 A. 7 175 Q. 1982 -- wow. Now, there he is saying that he is sending you statements for both Sterling and Dollar accounts? 8 9 I would A. Well, I must have had some in each is all I can say. 10 You know, he was a professional banker; I used to 11 listen to what he was saying. 12 176 Q. That actually isn't going to be my question at all. 13 My question then relates to the statement of the 14 Sterling account which you see on the next page? 15 A. 16 177 Q. Yes. You see you have a lodgment. I am not dealing with 17 the figures now at all; we needn't be concerned with 18 the figures. 19 Joint Account'. 20 account into the Sterling account? 21 A. 22 178 Q. 23 A. 25 179 Q. 26 A. 27 29 So there is a lodgment from a joint I haven't the faintest idea what it means. I think there are a few more documents dealing with the same thing that might assist you? 24 28 'Lodged' -- but then we have 'From There must have been some reason why he sent this. There must, indeed? ...Which escapes me now. You know, it is 19 years ago. 180 Q. If you look at page 67 and 68? 1 can't remember what and I can't remember what 2 happened to them. 3 181 Q Now, if you look at these documents, which appear to 4 be statements of your account, you see there the one 5 with 67 at the bottom (EXHIBIT 6)? 6 A 7 182 Q It looks as though half the... Yes. Yes, again we have Dollars and Sterling but then we 8 have a thing headed 'Joint Account'; do you see that 9 at page 68? 10 A 11 183 Q I haven't the faintest idea what that means. We have a lodgment; we have interest; and then we 12 have split half and half each. 13 talking about two persons, one of which appears to 14 be yourself. 15 who the second person is? 16 A 17 184 Q 18 No, I can't. So this seems to be Can you give me any assistance as to I have never seen this. Do you recollect having an account together with somebody else? 19 A 20 185 Q 21 A 22 186 Q 23 A 24 187 Q No. You have no recollection of that? No, I have never had a joint account. With anybody? In the context of this at all. Well, it may not have been in the context of this so 25 much as that money from a joint account which may 26 have been somewhere else was being lodged to your 27 Ansbacher account. 28 Tunnel Holdings at all that you can recollect? 29 Could it have any relation to 1 2 188 Q 3 A 4 I am looking at this thing that starts 11th December 1980 . 5 189 Q 6 A 7 190 Q 8 9 Which year are you looking at now? 191 Q Where is this? Page 2 of this. Repaid? MS. CUMMINS: Page 67. MS. MACKEY: Oh, yes. 10 No, it is really the next document that I 11 am more interested in but you can't assist me on 12 this joint account? 13 A No, I can't think what this means, frankly, 14 repaid'. 15 years ago. 16 192 Q 'and But never mind -- it is, as I say, 20 Could we have a look at page 63 now? Now, could you 17 look at that document which is another internal memo 18 from Joan Williams to, this time, D.P.C. who is 19 Mr. Collery. 20 A 21 193 Q This is February 1982? Yes . Now, here we have two amounts in US Dollars being 22 transferred to a bank in New York for credit of 23 Domnick Investors Corporation account. 24 me anything about that? 25 A 26 194 Q No, I have never heard of it. It is to be credited to your account and to the 27 account of a Mr. JD Birkin. 28 bell? 29 Can you tell Does that ring any 1 195 Q 2 A 3 196 Q 4 A 5 197 Q Oh, yes, I know Mr. Birkin. Could that be the joint account referred to? It is conceivable. Now, the reason I enquire into this is because of 6 the final paragraph in the same document where it 7 says one amount -- and it mentions the amount -­ 8 should be debited to 9 G.M.C.T...(INTERJECTION)(EXHIBIT 7) 10 A 11 198 Q 12 A 13 199 Q 14 A 15 200 Q 16 A 17 201 Q 18 A 19 202 Q Yes, I can see that. And the other to another G.M.C.T Account? 15816 -- is that this one or not? Yes, it is. So one of these accounts was yours; is that correct? Yes . Which is the 15816? Yes, that's right. The other is the account of another person? Yes . That's fine; we needn't bother any more with that. 20 Can I ask you to look at page 64 then which Ms. 21 Cummins will give you now again (EXHIBIT 8). 22 it is an internal memo from, this time, Mr. Traynor 23 himself, J.D.T, to P.O.D who is a Mr. O'Dwyer, a 24 banking loans manager in Guinness & Mahon. 25 the face of it, doesn't appear to have anything to 26 do with you. 27 28 29 It says: "Could you please arrange to let me have a Sterling draft for..." Again, This, on 1 "...payable to H.H. Draycott and debit G.M.C.T. A/A4." 2 3 But then down at the bottom we have in handwriting 4 'Posted to Mr. Mawdsley', which is the reason I am 5 asking you about it. 6 H.H Draycott? 7 A 8 Do you know anything about a Yes, I know who Draycott is. He was the director of a group that had a stake in Tunnel. 9 203 Q 10 A 11 Yes. What group was that? It was called Thomas W. Ward. It actually made a take-over bid for Tunnel. 12 204 Q 13 A 14 205 Q 15 A Thomas W. Ward? Yes, it does not exist any more. Can you throw any light then on this document? No, I can't. I can't think why I have a £57.44... 16 I went through these gyrations to get money to 17 somebody who I saw on a fairly regular basis. 18 206 Q 19 A 20 207 Q 21 22 But can this be a payment from you, do you think? I haven't the faintest idea. It refers to a Guinness Mahon Cayman Trust A/A4 account; is that yours? A No, I don't think it is. 23 by this. 24 which I sent to you. 25 208 Q 26 A This is why I am bemused Out of the other inquiry has come this, Yes ? I am challenging Mr. Davis' reasons for identifying 27 me with this because it looks about right. 28 is A/A15. 29 front of me, does it not? But it Now, that implies there are A/Al to 14 in 1 209 Q 2 3 different people? A 4 5 It doesn't even say which bank it is at. None of this stuff I sent to you has any origin on it. 210 Q The stuff you sent us, where did you get that stuff -- the document 6 7 A 8 211 Q 9 10 Well, it may well imply that but they would be (EXHIBIT 8)? Mr. Davis sent me this. But all the documents you have sent us you got from Mr. Davis; is that right? A 11 No, I have only sent you two things. One was a sheet of paper from Dublin. 12 212 Q 13 A 14 Yes . In the days when it went there and whatever went on elsewhere I was totally unaware of. 15 213 Q 16 A 17 214 Q 18 A 19 215 Q 20 A 21 216 Q So did you keep any records yourself? No. Not at all? No. Anyway, you can throw no light on G.M.C.T I can't think Do you think it is possible that you paid, for 22 whatever reason, this small sum of money to 23 Mr. Draycott? 24 might...(INTERJECTION)? 25 A 26 217 Q 27 A Can you think of any reason why you Why I bothered with £57 in that way? Yes? No, I can't, frankly. I am absolutely...(INTERJECTION). 28 29 A/A4? 218 Q You can't recollect. 35 Well, we will leave it. I 1 mean, if you can't remember, you can't remember. 2 Bereft of any rational explanation why I should go 3 through this particular hoop. 4 Can we just look at two more documents and then I 5 will be finished with my questions. 6 have some to ask you. 7 (EXHIBIT 9)? 8 A 9 10 Mr. Rowan may Page 73 and 74, please It is a very odd amount. I can't think...(INTERJECTION). 220 Q It is an odd amount, yes. Now, this may help you on 11 your A/A15 because here is a letter to you from, 12 again, Mr. Traynor, dated 19th June 1980. 13 He says: "Further to our discussions the other day, attached are some figures involved." 14 15 16 And attached we have figures relating to A/A15 and 17 A/A20. 18 relating to yourself? 19 A So it appears he was sending you figures Yes A/A15 scans with this. Now, at this stage, 20 where are we -- 1980. 21 outfit, which is Ansbacher Cayman, I think, was 22 involved. 23 business, not mine. 24 221 Q 25 I had no idea that this Where he put it, you know, is his But you are happy that whatever kind of place it was in, this relates to your funds -- these documents? 26 A 27 222 Q Well, it appears so, yes. A/A20 then appears to relate also to you. There 28 appear to be two accounts with fairly small sums in 29 them at that stage but there appear to be at least 1 2 two? A. Yes, I have no knowledge of A/A20 but, certainly, 3 think, as I say, from the filtering Mr. Davis and 4 his crew have done which he sent to me -- copies 5 which you have -- he must be fairly convinced that 6 this relates to the original one whenever. 7 223 Q. I Just for yourself, would you accept that if 8 Mr. Traynor was sending you the statement that they 9 must relate to you? 10 A. Yes, I mean, he was a banker; he is not going to 11 tell me about somebody else's affairs. 12 MS. MACKEY: 13 you. 15 has ? 17 18 19 20 21 22 23 24 25 26 27 28 29 I have no further questions to ask 14 16 Mr. Mawdsley, Thank you very much. Mr. Rowan, possibly, 1 2 FOLLOWS 3 4 224 Q MR. ROWAN: Mr. Mawdsley, may I just 5 at the start confirm in 6 the last 30 years where you have been resident? 7 A 8 225 Q 9 A In the UK. You have been resident in the UK? Oh, yes, always have been. I have travelled abroad 10 for periods all over the place in my life for 25 11 years but I have never been there long enough to 12 become tax resident in any other country. 13 226 Q There was reference to -- and I am not quite sure 14 how you pronounce this but let me try -- Bache 15 Halsey Stuart Shields? 16 A 17 227 Q 18 A Yes . Just tell me a little bit more about who they are? It was an American investment and brokerage firm. 19 It was some short-term investment. 20 remember, 21 Traynor knew about it. 22 228 Q 23 A I can't frankly, the details of it. I am sure Des You used their services? Yes. This thing came to me in ways I, frankly, 24 can't recall. 25 and I talked to Mr. Traynor about it. 26 independent professional merchant banker, you know, 27 there was nothing in it for him. 28 objective about it. 29 it. It seemed worth a look, let's say, As an He was totally I, obviously, went ahead with It unraveled at some later point. I don't 1 2 3 229 Q. So that you have explained to us that some time 4 after you had dinner or lunch with Mr. Traynor in 5 London...(INTERJECTION)? 6 A. 7 230 Q. Yes, I met him in the evening. ...and he explained to you that he could assist you 8 to shelter money offshore, sometime after that you 9 took up the offer? 10 A. 11 231 Q. Yes. That resulted in you opening a Sterling account and 12 at about the same time or sometime thereafter, a 13 dollar account? 14 A. Yes. I can't remember in what currency the thing 15 started. 16 just do not know. 17 offered an independent view because he was doing it, 18 presumably, with his own merchant banking clients on 19 the currency strengths and weaknesses at some 20 subsequent date. 21 from this about 20 years ago. 22 Sterling it went into Dollars for, presumably, good 23 reasons -- that the dollar was weak and worthless if 24 operated by waiting for the recovery and then it 25 could be translated back into Sterling and would be 26 a bit more profit on it. 27 28 29 232 Q. It is 21 years ago if it is a day and I As I said earlier, Des Traynor Again, you know, it is evident That if it was in Why you operated the accounts in that way is not something we need necessarily to know about? 1 2 I understand. 3 the money that you decided to invest or place on 4 deposit, shall we say, with Mr. Traynor, she asked 5 you was that money already offshore and there was 6 just a slight hesitancy in your answer. 7 you that question again, please? 8 A 9 234 Q When Ms. Mackey was asking you about Can I ask Its source was not the UK. I see. Subsequently, when you placed further 10 amounts into the account, did they all come from non 11 UK sources? 12 A 13 235 Q 14 A 15 236 Q Yes . They did? Yes . You explained that when you wanted a withdrawal of 16 some funds that you telephoned Mr. Traynor and some 17 time after that -- a week or whatever -- you would 18 arrange to collect the cash. 19 A 20 237 Q 21 A Did cash mean cash? Yes . It wasn't a draft or a cheque? No, sometimes it was travellers cheques. 22 Occasionally, 23 particular purpose but it was, essentially, cash. 24 It was not cheques made payable to a third party or 25 bank drafts or anything like that. 26 238 Q 27 A 28 239 Q 29 I took some travellers cheques for a Did you ask for it in cash? If I wanted it, yes. Did it ever come in other than cash or travellers cheques ? 1 No, I always got what I asked for. 2 events were few. 3 to day existence and there was invariably enough 4 time to prearrange these things at a time which was 5 mutually convenient. 6 240 Q 7 As I said, these They were not critical to my day The records which we have seen suggest they were relatively modest amounts? 8 A 9 241 Q That's right, yes. You have indicated to us that they really were not 10 of great significance in the grand scheme of your 11 financial affaors? 12 A 13 242 Q 14 No, if it all collapsed... So it does seem strange, therefore, that you operated in this way cash amounts from time to time? 15 A 16 243 Q Yes. Well, that is your view. You also indicated when Ms. Mackey asked you about 17 interest which you earned on your deposit accounts 18 how you dealt with that interest. 19 that you did not remit any interest to the UK? 20 A 21 244 Q Your answer was Yes . May I ask you did you return the interest as part of 22 your income? 23 I don't wish to comment on my tax affairs. 24 down that road, we are getting away from the objects 25 of this particular meeting. 26 creditor of Ansbacher or Guinness Cayman Trust, as 27 it were. 28 capacity I am party to defrauding its creditors or 29 anybody else for that matter. If we go You know, I am a It is preposterous to suggest that in that 1 245 Q That, of course, is a matter which the investigation 2 will have to draw some conclusions about in due 3 course. 4 A Well, So you choose not to answer my question? I am a UK resident, I have told you, for all 5 relevant purposes and that is as much as I am 6 prepared to say on the issue. 7 what it has got to do in the context of how this 8 account was operated. 9 you had better put a hold on it and I will come back I don't really see If you want to pursue this, 10 with some legal aid at my side. 11 resident. 12 director or an agent of the company. 13 involved in the carrying on of business at any 14 relevant time. 15 Companies Acts of Ireland. 16 have been party to conducting the affairs of the 17 company with the intent to defraud its creditors or 18 the creditors of any other person or otherwise. 19 246 Q 20 21 I never was an officer or a shadow I wasn't I am not aware that I breached any Certainly, I would not Well, I think that we have asked you the question and you have answered the question? A 22 23 I am not an Irish Yes, but can you please explain how pertinent it is to this particular brief? 247 Q 24 Well, if you -- and you have just been looking at the High Court Order? 25 A 26 248 Q Yes . ...under which we were appointed. I think you did 27 read on, I think, the third page of that order item 28 (d) -- one of our terms of reference. 29 to examine whether the affairs of the company were One term is 1 conducted with intent to defraud its creditors or 2 the creditors of any other person? 3 Yes, in relation to its Irish business, 4 says somewhere, doesn't it? 5 anyway. 6 MS. MACKEY: Yes, that is correct. MR. ROWAN: It does, yes. 7 249 Q 8 So carrying I don't think it is appropriate for us to debate the 10 terms of reference here? 11 A 12 250 Q 13 A 14 I am trying to be helpful. I understand. I think there is a point beyond which it loses the principal trust or the point of principal thrust. 251 Q 16 That is a judgment that at the end of the day we shall have to make. 17 A 18 252 Q 19 A 20 253 Q 21 Indeed. We were looking at page 64 (EXHIBIT 8)? Now, which one is that? The page number will be on the bottom right-hand corner of the documents that we have given you? 22 A 23 254 Q 24 Oh, Draycott, yes. On the face of it, this was a small amount which was payable to Mr. Draycott and charged to your account? 25 A 26 255 Q 27 A 28 29 Well, in your letter on, Mr. Mawdsley, because 9 15 I think it Yes . That is what it seems? I am sure there is no more to it than that. I can't think what it was for. 256 Q Can you express any views as to whether A/A4 may 43 1 have been an account which Mr. Draycott had an 2 interest in? 3 A. I really don't know. Harry Draycott was in a 4 similar position in Thomas W. Ward as was I. 5 another fellow sat on the Tunnel Board representing 6 that equity interest. 7 know, every month or two months or whatever it was 8 when meetings were held and periodically on matters 9 of mutual interest irrespective of any scheduled He and I saw him regularly -- you 10 meetings. 11 have just noticed that it says something -- Overseas 12 Nominees -- on the top left; have you seen that bit 13 there? 14 MS. MACKEY: He was in London from time to time. Yes, it seems to be like a 15 ghosted photocopy of some 16 other document but whether it has anything to do 17 with this...(INTERJECTION). 18 I A. Whether it has anything to do with this I do not 19 know because the action bit on this actually is 20 blotted out by sticking this telephone message over 21 it. 22 MS. MACKEY: 23 A. Yes. But I really have absolutely nothing to offer. I 24 have no recollection. 25 Harry Draycott out I could do and he could take me 26 out. 27 I would be refunding him or paying him £57 in old 28 money in early 1982 is just beyond belief. 29 not a minnon. I mean, if I wanted to take That is as far as it went. Why ever on earth This is It is, you know, a grain of sand in 1 2 257 Q 3 A 4 5 Thank you. Finally...(INTERJECTION) I enjoyed, you know, a reasonable relationship with this fellow. 258 Q Okay, we don't need any further clarification. 6 Finally, you explained to Ms. Mackey that you kept 7 no records of your dealings with Guinness Mahon 8 yourself? 9 A No, you have surprised me with the number of things 10 that were sent to me. 11 triggered these things appearing, except a switch 12 from Dollars to Sterling or something like that. 13 259 Q I can't recall why or what As someone who, I can well imagine, had a pretty 14 busy life with it, you didn't keep any record; you 15 relied on Mr. Traynor or his colleagues to keep the 16 records. 17 A No, I relied on Mr. Traynor and I left messages with 18 his colleagues. 19 discussed any of the movements within this account 20 with any of them with the possible exception of 21 Mr. Collery when things went wrong in '95 and I was 22 seeking to unravel all this. 23 260 Q As far as I am aware, I never How, if you didn't keep any records and subject, of 24 course, to the fact that you may well have a very 25 retentive memory, how could you be sure that your 26 affairs were being properly looked after by Guinness 27 and Mahon and Mr. Traynor? 28 Well, quite simply, I had formed the view that Des 29 Traynor was looking after individual and corporate 1 financial affairs for a number of companies and it 2 had never crossed my mind since, I think -- was he 3 the managing director of it at that time? 4 certainly, the director of Guinness and Mahon. 5 261 Q. 6 A. He was, He certainly rose to that position, yes? There was no reason why I shouldn't trust him any 7 more than I shouldn't have trusted, for example, 8 people in the same position in comparably sized 9 merchant banks with whom I had contact. Singer & 10 Friedlander is still about in Britain. 11 called Chase Brothers. 12 the other one I was thinking of? 13 but I had links with these people. 14 my business to pick up the intelligence of who might 15 be thinking of getting out of what that might suit 16 us to buy into and Des was in that business himself. 17 262 Q. 18 A. There is one Leopold Joseph -- what is It doesn't matter You know, it was He was a man you met four or five times? Not that many times but I spoke to him over the 19 phone. 20 different context in my latter days at the House of 21 Fraser group, by which time I had left the original 22 listed public company and I was actually in the 23 director of the company that was formed to buy the 24 House of Fraser group. 25 Britain. 26 was trying to identify poor returning assets. 27 were two notable ones. 28 Copenhagen called Ilium, which was sold. 29 was Switzers in Dublin, which you may recall. The last time I met him was in a totally It was a private company in Part of the work I did in the Fraser group There One was a store in The other The 1 Chairman of the time asked me did I know anyone in 2 Ireland who might be plugged into who wanted to do 3 what sort of thing and I said: 4 very man for you'. 5 better go and see him'. 6 Dublin. 7 ever went to the office, actually. 8 hotel I was staying in because I was paying a call 9 on Switzers anyway to look at it's pre-audit 'I think I know the And he said: 'Well, you'd So I went and met him in I didn't go to the office. I don't think I I met him in the 10 condition -- you know, make sure they got all their 11 ducks in the right place -- and I told him the story 12 and that was it. 13 because I left before that. 14 263 Q. Whether he sold it, I never knew Just to summarize the position, you met him four or 15 five times; you placed implicit trust in 16 him...(INTERJECTION)? 17 A. 18 2 64 Q. You didn't get any documents from him apart from...(INTERJECTION) 19 20 Yes, because of his position. A. Well, I got more than I remembered I got but, I 21 mean, there must have been some reason for this, as 22 I say -- possibly, changing currencies or something 23 like that. 24 265 Q. I think you also said that most of the merchant 25 banks, particularly in London, would probably have 26 provided similar facilities to that which Des 27 Traynor was providing? 28 29 A. Well, most banks do have a variety of companies 1 you know, have offices in Jersey and Guernsey for 2 the same reason. 3 266 Q. May I ask you the question which follows from all of 4 that -- why then did you choose the slight 5 inconvenience of operating from a Dublin base as 6 opposed to a base in London in terms of sheltering 7 your offshore interest? 8 A. 9 Well, I didn't think, given the nature of it, it was the sort of thing that people I was dealing with on 10 a corporate basis should get involved in, frankly. 11 267 Q. 12 A. I see? I am well aware of what it represents and that is 13 the case. 14 MR. ROWAN: 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Those are the questions I wanted to ask. Ms. Mackey has one other question. 1 2 AS FOLLOWS 3 4 MS. MACKEY: One other little thing 5 that just occurred to me 6 to clarify is something I spoke to you about 7 earlier. 8 joint account that emerged and the name of Sir John 9 Derek Birkin came up and I asked you was it possible We were talking about this question of a 10 that he was the other half of the joint account and 11 you said that it could be. 12 interests with Sir Derek Birkin? 13 A 14 Derek Birkin was the managing director -- the chief executive of Tunnel. 15 269 Q 16 A 17 270 Q 18 A Did you have business He became the Chairman. So...(INTERJECTION) Oh, yes. I mean, we worked together. Did you both have shareholdings in Tunnel? Yes, very modest ones. Whatever the directors 19 qualification shares were. 20 director's qualification shares were. 21 very cheap at the time we joined it in the 70's. 22 think they were under a pound and I think I bought 23 500 shares. 24 271 Q 25 A 26 272 Q 27 A 28 273 Q 29 I had whatever the They were Was that your only business connection with him? Well, he was my boss. He was your boss? Inescapable connection. But you weren't involved in any other enterprise with him? I 1 A. 2 No, we were imported into the group to get it right. MS. MACKEY: Well, I think that is 3 all we need to ask you, 4 Mr. Mawdsley. 5 twice -- the first time abortively. 6 much you were able to do it today. 7 ask you to sign the transcript in due course. 8 A. 9 Thank you very much for coming along Thank you very We will need to Yes, well, I gave evidence to the DTI Inquiry into the House of Fraser and where they got the dough 10 from -- popularly believed to be the Sultan of 11 Brunei, which they vehemently denied to this day. 12 This was run on very similar lines, frankly. 13 MS. MACKEY: What we will do is we will 14 send you the transcript 15 and -- how will we do it then, Ms. Cummins 16 MS. CUMMINS: We would ask you as soon 17 as you have checked it and 18 agree with the contents that you would have the 19 original notarised here in London. 20 A. 21 Right. MS. CUMMINS: Now, I will be sending a 22 separate copy, obviously, 23 to the copy that you initially get. 24 original copy with an original signature on the 25 front and we would ask you to sign it and have it 26 authorised. 27 instructions on that copy. 28 29 A. It would be an But I can give you the detailed Yes, of course. Well, I have had something notarised for Mr. Davis. 1 That's grand. 2 3 A. It is actually the firm who looks after the legal 4 affairs of the management company. 5 MS. MACKEY: very much indeed, 6 7 That's perfect. Mr. Mawdsley. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW WAS THEN CONCLUDED Thank you f a b L^+jd- A IS\ p - r ll fo 'X O 'J b M Afw L o o / ”7 \jy 7 3 i\jr ~ b I tr u (& U J /u o A i^ d r K t- u y & 3 X . 7 ^ £ a -~ 4 S > k -& L J L g ^ T - a > ^ ^ r V A fsiA V r \ X - G i r i & g . l-» 51 to 07a * y l o jl , fJL & u rcr 3 * *7 L L cC rs 349 526? 1 C.X.B.T.C. 0808 849 5267 A enry ANSBACHIR (CAYMAN)UMI P0BOX 817 GRAND CAYMAN CAYMAN BUNDS BRITISHWESTINDIES Telephone809949I6SJ Fr no.1099495267 TdexCP4305 ‘ nsbacher ELEFAX (onu - JO H N A . FU R Z E To: M IS - A ttc n fto n ; R tx K « R ef do. JA Fa m '' D u b lin 8 , Ir e lt a d D .P A D R A IO C O L L E R Y .. : ,0 1 1 -3 5 3 -1 -6 7 7 -1 1 6 4 D a te : 2 3 M a rc h , 1995 . one) D e a r P a d r a ig ,^ T h i s p a g e o n ly , : • • • • • • • • • • I c o n f ir m a rra n g e m e n ts h a v e b e e n m a d e f b r B a s il M a w d s le y t o c o lle c t £ 1 ,0 0 0 .0 0 I n c a s h fro m A n d y L o v e in L o n d o n cm M o n d a y . ' . .. Plcsac arrangetocndftfhe SundrySul>-CbmpanyAccountwilh£1,030.00 'I Yours sincerely, . A . Fune ' *YauHXvaNornc8vBWTn»!Lin«KwrMBat>\juiaBAaaRM«utuiieui.(MtwMei ■ ca«— mmnvmrct ThUftwlwlimm*/* i» ht i a i i i w frtw m **tmh m l i j dlu « rtMi w l i m *tp aMM a* r y » hp nm »K W»(«raa»,’ ro. ’‘ • • i» * '* ••* **Vj» r * »* ' * *' ' V '* 1 "*rf* ••• *“• : ‘ ', . • • • '4 ' • ’‘ '* . * / ** / ■ •' v• * • • .' I. A. f •"*•••<. * ,w •* jO **J LWSATION’ A ,J .y ? * T O . • • ’ * it P . P .'C . ^ • A-*. • . < /. v ; ;.. •'•: V • •V •5^V^. ; •' 4.vV'.: ’:’ . » ^ , • * » / . 2riid' J f o v e m b e r , • r • ' * ; .: . • •. • m: v .. - 1984. Ms^-isleyi nitfea ftairtAt• Could you, please organise to lodge the attached fry Xt\r. •* ’ li\* t’ **. *. * rfV *’• * ••’ ••..•• ' t - •** u • -‘•"•'C''."-'': .• • !■'■ &'i; i-,V.ftpqan.fe ; \ '"‘J iuf’ S o h - .*:.•/., . “ • '.V•:: >.>iV;Kt?acr • ?ck Ccrppri : • ..■ • • . J-:iPOO y r v V - ’ •! si*’ ’ ’’ - !,vj • .. 1 .. • ^ .V e h a tr a s. r,3 f • $ f i l ‘e i iV- • i •f’ .. iV • ~i’ X a' :-v .f*V v':--: .•■ fdit-'." V, I . •“ ■•• ..v .. . :•* .• . ■■ i , .i-r. -•• ». I * -A V : .. . i • ; • •'•• ‘ tp . ' •• \ . .. . . • •• .• * *.• I- j• .. • . ... i w.v*** * * v •* *, .j .! V--. I; • • •. • • A. J.W. /»%*• < m * • * ! J , •*»•.**• - - N * V- : ( ; -•« *«s •»*••'A « ' v 3 .T ? - S - • ' •{ *••». % * IH t > \l , , t , K \ r r .? J C - r $ “ * * * . , ** V : •* \ , • •••' • ' *... * ••• •» » . *«» # . • *• b k i » V * •' * * * * ^ « * « » » •'■ Tf.t ++. «* • * • •r'*«^« --- gjtv Y~;. 73 .™\' * . * ‘ I r _ 1 havs pleasure ia enclosing berevlth oMy*lBiuilt*u", ,i,**r Statmrats to* tooth Sterling and Dollar Accounts trim V. ; • ■ Cash 1.000 . . £K- .-SC2. 00 SS J2a ’*SS^j^5?ne* *?ul$ 3roa P**«« Check and,. ,, ft the wtmSfeta on th* Accounts agree wl~th-Too'r,'~-" r i n ^ S ’3*atmP*OUld you hllv* anjr 1«*ei«s P«rhapa jrotf »dt«ar. K/i/1982 Ha Shares- fi2.727.81 ; sob.oo i i i, i' JDT/AJW STKBLZKO ACCOUNT 23/1/1980 . . ' Lodged .Fran.'Joint.Accomit Interest t»-.31/l/1981 . Ell,<27.65 • 5,889.50 1.854.00 £19,171.15 •V'.- . •; 5 *t* •I .. '■ • '•> 17/12/1981 ■ " 31/1/1982 L e s s Dri.wn: .12/1/1982 10/2/1982 •• Transferred to Dollars' ei9.171.15 ’Hil Lodged Gross £17,462 . . ‘ Cush l.doo ’Interest ' ’ . Bs S h a r e s ' 1 C a sh . ’ , B a l a n c e '- ■£2,727.81 500.00 £16,462.00' — ..2,71 4 1 £16,740.11 3.227.81 £13,512.30 j. • • -j• •. *.*• . •• • JOINT ACCOTJHT \.*/ .. V 12/6/1980 - Lodged • Interest -to-’31/1/1981 £10,695.19 ' 1,083.81 £11,779.00 WMMMtaHHHB Split-.} x - i each £5,889.50 AppendiiXY '1 i ‘ A . J . W. t o P .P .< 3.~ 1 6 th y e b r u a r y , 1 }'’ T ,.vr • / >**;**• b,. •• . ■« * * 1982 t . • r».v «-. * •* *. ", . * ,> « . Coaid you please arrange to transfer two amounts of , U . S . $1,750 each -tor . i*. V% K.> • ' • •' Bankefs liniat Company,.•*. ; • . ' -16 Wall'S tree t, • • . *.• • 'New York/. . • ..........• • . for credl't of Dbmnlck Investors Corporation Account No.00801625-. e ' ; $1750 to be credited to Ur. J.D/.Blrkln’ .B. Account No.00380 88 170 and $1750 to be credited to Ur. A.J.B. Hawde ley’ s Account Ho.0038852179. * „ •‘ , • ,. *• •'' •••; . j • It la apparently important -that the two amounts of ■ $1730 be In Hew York, not'later than Triday of this.' week.'...'.a/ . ’ One amount of. $1750 should be'debited to G.ll.C.T. Account Ho. 15816/03/68. and the. other to G.K.C.T. „■ Account 'No. 20738/03/68. . ' N.., >s<: ft;-. i - I. %♦ ••••! ** ’. **• *»• .« .*I ** « .f t I. A. J . W. a $ity*K>b(jCL A y (bcjh v * -. .. ' I. *. * 11/12/1980 In te re s t • C o n v e rte d to U .S . D o lla r s 2 9 /1 /1 9 8 1 s, 2 6 /2 /1 9 8 1 C o n v e rte d " * / 7 / 1 9 8 l • In t e r e s t to S te rlin g BBRTB . ;'*.*•« ■ *«*•*••••."•«.•. ’» Ko7aiaeefl’• . ;• ; ; V ~£°“ *h 'T ^ o n ^ ' - ' • ‘ .^ ,' "... ! ■: nsw / . «ymb« ' • . *. ■ • & ••S/21S3. ;'.• . st* j*nQtr_ • ’•. ; ' ■ WECONWMThATWe^AVE^i^^^.. .' . " -- J. ,.".'v-->^.;, .> •■■'."—...4 Ty~-> -y-'^ " V'v’- ............. ’ l.r-, .-'•■f'-i. • ’ .r I w :. v — *?".*£.■■■•*>-*•.'•■':-t'-s^’f‘ "»./ I J-0.3P. 3 tg . ' - ij 11 - 1... - ' — i .. .— \ f 'W / < ’ I 1 I ' A f * A M r ................... 3 / flj/£ 7f * ;«* /m IM jls ] t* 7 M iS r A f»?m n Of ! _____ _ _ .........._.... _________ • .... . . i - & 6 ?f3 ? / e c v r t* £ a 9 r 64 L9&1 PC C r o a> ?! V? ............. • i p j - - • — • . • ........I i­ ......... 1% ______ L 1 . AOCOUNTNUMBER eoo<>i m PAGE BALANCESSHOWNAWBN: s t a r U na 3 0 /11/9 5 3 1/12 /9 5 3 1/12 /9 5 BaOUQHTPORWARO In te r e s t to 3 1/12 /9 5 CABRieOWRWAftP 96.56 , 7661.70 - - .- . .I Cli/ Ac 8 Starling 8000! '73 3.001 coll dopoolt ?mwa 15.2: in": ?any!? 0 Cull: [nun-t luv-pl I nun EIIPCIQ . Meant Va Incl-nun ulna. lurud In. mwmu nose . . - 1va an.? 21.3: 5.0060000 . . [Itaront A ppendix X V (90) Professor A nthony J M errett 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Professor Anthony J Merrett. a) Letter of 23 June 1977 - GMCT to Guinness and Mahon. b) Letter of 1 July 1977 - Guinness and Mahon to GMCT. c) Letter of 19 July 1977 - GMCT to Guinness and Mahon. d) Guinness and Mahon statement of a/c of 7 September 1977. GUINNESS M A H O N CAYMAN T R U S T LIMITED A M e m b e r o f I h e G u in n e s s M a h o n M e rc h a n t B a n k in g G ro u p T e le p h o n e N o 9 - 4 6 5 3 /4 T e le i CP 305 C a b le A d d re a s G u in n e s s • R O .B o x 8 8 7 . G re n d C ay m an - ' B r itla h W e a l I n d ie s your rel our ref JA F / £ c 23nd Jane, 1977 /’“V UichaeZ J . PendeA, E&q. Gwinnett 8 Mahon Ltd. 17 College. Gn.e.en Vubtin 2 JKELANV VeaA MichaeZ, PROF. WERRETT It was a. plexu>uA& talking to you aveA the. teZephone. yeAteAday, and tu a AA&ult o& ou/l canveAiation I con&Utm that we have, advanced a i[ustfkeJi amount OiJ US$15,000 to ?no£. MeAA&tt. Thii hm incAeM&d oua totaZ Zerding to him to US$45,000 and I think if you. note youA ledgeA caAd to the. e.£{e.ct that iay t35,000 JU hypothecated to u& tfuA should be. Auiiielejit baaed on pieAent txcJkcuige Aat&i to coveA the. totat advance, and inteAeAt theAton. 7k di“> cjoujL&e peAhapi, you uouZd kindJty d/top me. a line. con£-Owujig thii action fuu been taken. VauAM iinc.eA.eZy, I T '0 ^ \\ . 1 (s>tf- FURZE £ ioLf £ & r c h ~ e t(/U K ) MJP/JB 1st July, 1977 Mr, Jphn A. Furze Guinne aa Mahon Cayman Trust Ltd., P.O. Box 887, Grand Cayman, British West Indie8 Dear John, PROFESSOR M E R R E T T » In reply to your letter of 23rd June, 1977 regarding the above, I confirm that Professor Merrett has today authorised m e to hypothecate the equivalent of a further $20, 000, and I have agreed to do this. He will be contacting you with a view to arranging a ( 2 0 , 000 additional loan, which I coztfirxned to him would be in order. Accordingly, 1 confirm that £ 5 0 , 0 0 0 Is at present being held by Guinness + Mahon to cover his borrowing from you. ■ Kindest regards and looking forward to seeing you aoon. Yours sincerely, i Michael J. Pender Banking Director GUINNESS M A H O N C A Y M A N TRUST LIMITED ' A M e m b e r o f th a G u in n a a a M a h o n M e rc h a n t B a n k in g G ro u p T e le p h o n e N o S -4 6 5 3 /4 T a la x CP 305 C a b le A d d ra a a G u in n a a a your rat MJP/JB o u r raf J A F / P .O . B o x 8 8 7 G ran d C ay m an B ritis h W a s t In d ia a {JL 19th J u ly , 19 7 7 ■v M ichael J . Pe.nd.iA, E&q. Banking Manage*. Gainne&A + Mahon Ltd. 17 College. Gneen DublUn 2 IRELAND VextA. M ichael, c. PRO FESSO R M ERRETT you vefty m uch {ok youA. tette/i o{ lit July aoncejtning Pw^eAiOA Mewuett. Thank W i t h t h e {u / it h e J i a d v a n c e u /h ic h w e h a v e e j e c t e d pfio£e&40A. M e A J ie tt ha* t o t a l b o fin o u tin g* {Korn ut> o{ $65,000 w h ic h o n p w u v n t e x c h a n g e h a t i u - i i i u j f C c i e n t l y c o v e t e d b y t h e h y p o t h e c a t i o n o { 150,000 h e l d b y y o u . I am m a k in g a w i a n g e m n t i t o m e e t u x ith Pjio£. M e / m e tt i n New Vatdi l a t o i t k U m o n th t o di&cuA-i t k U b o M o u tin g w i t h h im a n d I n p a f i t i c u l a t i t h e i o u A c e o { r e p a y m e n t , - i i n c z I u n d e J U ta n d t h a t t h e fiu n d i d e p o s i t e d u x ith y o u o n e - i n d o m e s t ic a n d n o t io t u e ig n e w u iz n c y . ^B e & t uiiiheA, Vouka tinceAely, JOHN A. FURZE ‘ NON....BEsZcAXA JDBP.OSIX ..... ,V . . . ^ A C C O U N T sta te m e n t p°y.; i,oon,i43. 00.1 MERrtETT A J s y m b o ls fi dibitbaianca In btnrwt Ig lodgmant d> chmmbook • creditbaianca cm commlHlon cw CMh withdrawal to standingordar G u in n e s s & M a h o n L td A.J. Merrett Esq.# Brookland Place# Brookland, Kent TN29 9RH. 17 COLLEGE GREEN DUBLIN 2 TELEPHONE 782444 TELEX 5205 A ppendix X V (91) M r G eoffrey M iller 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Geoffrey Miller. a) Transcript of evidence of Mr Geoffrey Miller dated 25 February 2000. b) Letter of 23 October 1990 - Ansbacher Limited to Guinness and Mahon. c) Print-out of statement of account of 25 October 1990 re Ansbacher Limited. d) Schedule of Ansbacher Limited balances as at 31 December 1989. e) Letter of 11 April 1990 - Ansbacher Limited to Guinness and Mahon. Correspondence received from or on behalf of Mr Geoffrey Miller. a) Letter of 6 December 2001 - Murphy’s Solicitors to Inspectors. UNDER OATH ON FRIDAY, 25TH FEBRUARY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL The Inspector's Accpountant MR. T. SLEVIN Interviewee: MR. GEOFFREY MILLER Represented by: MR. H. MOHAN BL Instructed by: MR. STAN MURPHY MURPHYS 21 UPPER GEORGE'S STREET DUN LAOGHAIRE CO DUBLIN WITNESS MR. G. MILLE EXAMINATION MR. JUSTICE COSTELLO PAGE 6 - 3 0 MS. MACKEY 31 - 42 MR. JUSTICE COSTELLO 42 - 55 M S . MACKEY 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Miller, we will start our interview then. 6 name is Declan Costello and Ms. Mackey is on my 7 right. 8 The High Court into this matter. 9 briefly indicate to you the procedure we are My We have been appointed as the Inspectors by I want to just 10 adopting today. 11 tribunal. 12 investigation, which we are required to undertake by 13 order of the Court. This is not a Court. It is not a It is an interview as part of our 14 15 If in the course of the questions that we ask you, 16 you wish to obtain the advise of Mr. Mohan or your 17 solicitor please tell me so and will we stop asking 18 the questions and you can take advise. 19 course of the interview Mr. Mohan or your solicitor 20 wishes to discuss any point with you, they can 21 indicate that to us and we will stop and you can 22 take legal advise on the matter. If in the 23 24 Mr. Miller, we wish to have this evidence taken 25 under oath and I will ask Mrs. Mackey now to 26 administer the oath to you. 27 MR. MOHAN: 28 29 Might I simply say for the record that, in fact, Mr. Miller's instructions to me are to make full and 1 frank disclosure and to cooperate absolutely fully 2 with whatever questions you may ask. 3 MR. JUSTICE COSTELLO: 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Very good. 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Miller, for the purposes of the record, 6 could you just give us a general introduction to 7 your career and what your business career has been? 8 Then we can come to deal with your association with 9 Mr. Traynor and with Ansbacher and 10 with Guinness & Mahon? 11 A. 12 2 Q. A. 15 Yes. Well, it is very very simple. I will give you the entire background as soon as I can. 16 3 Q. 17 A. 18 4 Q. 19 A. 20 Yes? As quickly as I can. Yes, yes? I started as an office boy in Williams & Woods in Parnell Street. 21 5 Q. 22 A. 23 Yes? I left there during the war. Went away for three years, came back ...(INTERJECTION). 24 6 Q. 25 A. 26 7 Q. 27 A. 28 8 Q. 29 Just in a general way what your business career has been? 13 14 Yes. Just a bit slowly now. It has to be taken down? I came back ...(INTERJECTION). Just a little slowly? Sorry. It has to be taken down, Mr. Miller? 1 9 Q 2 A 3 10 Q All right. She has very good hearing, Mr. Miller. 4 you all right. 5 tell me? 6 A 7 11 Q 8 A 9 12 Q 10 A She can hear If you would talk to me and just Right. You came back after the war then? Yes . Did you start your own firm? No, I started with my uncle then and then I stayed 11 -- I wasn't very enthusiastic about it. 12 with my father who had a very, very small business 13 including one agency. 14 13 Q 15 A 16 I went in Yes? What we used to call Rayophane, which was in fact cellophane which goes around cigarette packets. 17 14 Q 18 A 19 15 Q 20 A 21 16 Q 22 A Yes ? It was at that time the only transparent packaging. Yes? Okay. Yes? He had done nothing with it. He had been through a 23 terrible time during the war. 24 supplies. 25 time in the 1930's. 26 there. 27 Yes? 28 I didn't not take a great deal of interest but 29 however I got interested. You could not get You could not get anything. He had a bad There was very, very little 1 18 Q 2 A 3 19 Q 4 A 5 20 Q 6 A 7 21 Q 8 A Yes . 9 22 Q Yes ? 10 A 11 23 Q 12 A And from there on we started to build the business. Yes ? Okay. Yes . That was GB Miller & Son. And Son? Okay. Yes ? Now, I am just trying to think about what happened. 13 It seems so simple. 14 expanded the business and it just grew. 15 my father, myself and a secretary. 16 24 Q 17 A 18 25 Q 19 A 20 There was You were Director of it? Well, it wasn't a limited company. Was it not? It was just a private company. That is all there was to it. 21 26 Q 22 A 23 27 Q 24 25 We expanded our agencies and we Yes? And it went on like that with one girl in two rooms. Did you develop then? Did you become a limited company or were you ...(INTERJECTION)? A 26 We became a limited company in -- against my father's wishes. 27 28 Q 28 A 29 29 Q Just generally? Well, yes. Yes. It must have been 1948 or 1949 or so. Were you a director then of the company? 1 2 30 Q. 3 A. 4 31 Q. 5 A. 6 32 Q. 7 A. 8 9 And your father was? And my father was a director. Yes. Then the business expanded, did it? The business expanded. Yes? We got other agencies we got one particularly fine agency. 33 Q. 10 Yes. Your business career has been associated then with GB Miller & Son Limited? 11 A. 12 34 Q. 13 A. Yes. 14 35 Q. Yes. All my life, yes. All your life? We are concerned with the relationship which 15 you may have had with the company now known as 16 "Ansbacher". 17 in the letter, we asked you for a full statement and 18 we have not obtained a full statement from you 19 Mr. Miller. 20 A. 21 36 Q. 22 A. 23 37 Q. 24 A. 25 38 Q. 26 A. 27 39 Q. 28 A. 29 40 Q. In relation to that, you will recall Can you give it to us now? I was told I didn't need a statement. I see. Very well? That it was unnecessary. Yes, I see? That you decided to do away with it. I see? I had one drafted. I see? Which I have left behind. I see. Very well. Just tell us now then what your 1 relationship was with the company that we are 2 concerned about and how it came about? 3 A. 4 got connected with Guinness & Mahon. 5 41 Q. 6 A. 7 42 Q. 9 A. 10 43 Q. 12 A. 13 I made a statement to the Have you got that? We have not, no? All right. Well, then I would want to go into more No, if you can ...(INTERJECTION)? I will go into the thing all over again is what I am trying to say. 44 Q. 15 17 And that is very simple. depth with you about the thing. 11 16 Please do? Moriarty Tribunal before. 8 14 Well, to start off I would have to tell you how I It would assist us if you could give us that statement ? A. 45 Q . 18 A. 19 46 Q. 20 A. I haven't got it. Yes? Okay. You can arrange that? I didn't bring it. 21 MR. MURPHY: I can arrange that. 22 MR. JUSTICE COSTELLO: Very well. 23 MR. MURPHY: Yes . 24 MR. JUSTICE COSTELLO: Yes . 25 MR. MURPHY: We can send it on. 26 We do not have it today. 27 MR. JUSTICE COSTELLO: Yes, very well. 28 MR. MURPHY: It is between myself and 29 counsel. 1 2 MR. MURPHY: 3 fallen between the two. 4 MR. JUSTICE COSTELLO: Yes . 5 MR. MURPHY: What I have can certainly 6 be sent on. 7 47 Q. 8 A. 9 MR. JUSTICE COSTELLO: Yes, very well. Well, during the 1966 bank strike, the first bank strike, I was strapped for money. I had £100,000 10 worth of cheques which I couldn't cash. 11 was with AIB in Capel Street. 12 I have this money." 13 company was growing quite rapidly. 14 48 Q. 15 A. Okay? My account So, I thought, "Well, There is money and cash. The Yes? There was money in Capel Street which I couldn't get 16 at. 17 They were a branch of it and I said, 18 principals in England were pestering me for money. 19 They said, "These blank cheques, which we can't 20 cash, these cheques which we can't cash are no damn 21 good to us. 22 them and they were in College Green and I asked them 23 for the money. 24 said, 25 Street. 26 We have been with you for 7 0 years. 27 bloody money." 28 No, they couldn't interfere. 29 of guarantees. So, I went to Allied Irish Investment Bank. We want money." "I want" -- My So, I went along to They could not give it to me. "There is the cheques. I The money is in Capel You are not on strike. You are a branch. I want some And they wouldn't give it to me. Okay? They wanted all sorts 1 49 Q 2 Yes. I wonder if I could try to shorten it a little bit? 3 A 4 50 Q 5 A Yes. 6 51 Q Yes? 7 A 8 52 Q 9 A 10 53 Q 11 A Yes, all right. I would just like the ...(INTERJECTION)? So, I was raging at that. And I walked across the road into Guinness & Mahon. Yes? That was the time I started with Guinness & Mahon. Yes ? We stayed on with Guinness & Mahon using them for 12 transfers, credit transfers and things like that, 13 only for big amounts and we then -- so, at that time 14 we stayed in Guinness and Mahon until the company 15 started to get very much bigger, very much stronger. 16 54 Q 17 A Yes ? I had two accountants. I got rid of them, one after 18 the other because they didn't seem to be doing their 19 job properly. 20 of money in those time. 21 net £20,000 a year from two rooms and myself, which 22 was a lot of money. 23 55 Q 24 A 25 56 Q 26 A I was making what I thought was a lot Something in the region of Did you go to ...(INTERJECTION)? 20 years ago. Did you meet Mr. Traynor? No, before that -- what I am trying to say was, we 27 just traded directly a little bit with 28 Guinness & Mahon. 29 57 Q Yes? 1 For letters of credit and things like that. 2 main business was done with Allied Irish Banks and I 3 just did it because they had been good to me during 4 the thing. Okay? 5 58 Q 6 A The Yes ? So, then I went to -- I said, "I will have to get a 7 good accountant." I went into SKC, who I thought 8 were the best people in the country, they put me in 9 touch with their tax advisor and he said that there 10 were possibilities with my type of business 11 ...(INTERJECTION). 12 59 Q 13 A Don Reid. 14 60 Q Don Reid? 15 A Yes . 16 61 Q Yes ? 17 A 18 62 Q 19 A 20 63 Q 21 A 22 64 Q 23 24 What was your tax advisor's name? He was ...(INTERJECTION). Yes ? At that time he was a partner I believe. Yes? And supposed to be their tax expert. Yes. Generally what was the scheme that was operated? A Yes, this is what I am coming to now. The scheme 25 was that a company -- one of our companies that we 26 were distributors for, paid us on commission only. 27 65 Q 28 A 29 Yes? And it was a smaller part of our business but it was quite substantial and they were to set up, or they 1 would set up, a company in Jersey which was an 2 overseas company. 3 66 Q. 4 A. Yes? And we would pay that company or they would appoint 5 that company as advisors to the Irish market, on how 6 they should market their goods to the Irish market. 7 An agreement would be drawn up and we would 8 relinquish half our commission. 9 was 5 percent. Our commission Half the commission was two and a 10 half percent and these would be paid into the 11 Guernsey company. 12 67 Q. 13 A. What was the name of the company? I can't remember the name of the company but I have 14 recalled -- the last meeting we were at they said 15 who that company was. 16 anything to do with that. 17 by British Ceedack Limited, who were our suppliers. 18 This was nothing unusual for them because they were 19 doing it with agents all over the world, keeping 20 money in London and various places overseas. 21 68 Q. 22 A. 23 69 Q. 24 This was a company formed Yes? Part of their commission. Did British Ceedack Limited form a company on your instructions in Guernsey? 25 A. 26 70 Q. 27 A. 28 71 Q. 29 You see, I didn't have Yes, yes. And, how ...(INTERJECTION)? Basically on my instructions. Half the commission that you were entitled to went 1 2 3 A. I can't remember the name of the company. 4 73 Q. Have you any records available as to this 5 transaction? 6 A. 7 74 Q. 8 A. 9 75 Q. 10 A. 11 76 Q. 12 A. I never kept any records of this. Yes? I just didn't keep any. Who ...(INTERJECTION)? I am like that. Did Mr. Reid in SKC ...(INTERJECTION)? I approached British Ceedack. My father had been 13 agents for them since 1937 and I explained the 14 situation and their sales manager, who is now dead, 15 said, "Geoff, there is no problem. 16 for everybody all over the world". 17 77 Q. 18 All right. This will happen then. I am doing it It was was set up? 19 A. 20 78 Q. 21 Yes, it was ...(INTERJECTION). The money, half the money, went into the Guernsey company? 22 A. 23 7 9 Q. 24 A. It went into this company, yes. Then what was the rest of the arrangement. Well, I am trying to puzzle out how Guinness & Mahon 25 got involved in this and I think that they took on a 26 trust or bankers in the Isle Of Man at whose 27 insistence or suggestion it was, were Guinness & 28 Mahon. 29 1 No, were Guinness & Mahon. 2 after this company on behalf of Ceedack were 3 Guinness & Mahon. 4 oath so I have got to be very careful about this but 5 I was asked, 6 it such and such a company," at the last 7 Moriarty meeting. 8 including College Trustees. 9 81 Q 10 A The bankers who looked Now, this I am not -- I am under "Was it such and such a company? Was Several companies were mentioned Yes ? At that time it didn't click but since then -- and 11 mind you I have also read this in the newspapers. 12 This is why I cannot positively say that it was 13 College Trustees but I am virtually certain it was 14 College Trustees. 15 Guinness & Mahon became connected with -- how I 16 became connected -- although I was a customer of 17 Guinness & Mahon I think that was my introduction of 18 the overseas company to Guinness & Mahon. 19 82 Q 20 A 21 83 Q 22 A I think that that is how Yes? Okay? Yes . Now, I thought this was -- well, God, I was 36 years 23 of age at that time. 24 ...(INTERJECTION). 25 84 Q 26 A 27 85 Q 28 A 29 86 Q I was raising two boys and I If you could just ...(INTERJECTION)? Anyway. Just tell us ...(INTERJECTION)? All right. So, then ...(INTERJECTION). 1 2 87 Q 3 A 4 88 Q 5 A Okay, I will. Yes. I am just getting a bit carried away. Just keep it as short as you can? Yes, Okay. I think that is what it was. Now, I was 6 fully convinced that this was legal or I had been 7 told that it was legal: 8 The money is coming into Ireland. 9 commission wasn't paid to you and you just didn't "Absolutely legal, yes. If your 10 get your commission, you wouldn't have to advise 11 The Revenue Commissioners. 12 separate company outside the jurisdiction of Ireland 13 and it is staying there and it is mounting up." 14 89 Q 15 A 16 This money is going to a Yes? "Occasionally this company may lend you a bit of money" or something. 17 90 Q 18 A 19 91 Q 20 A Who? Which I didn't use. Who advised you about this? I don't honestly know. Mr. Reid, was it? I couldn't say definitely 21 who it was. 22 I felt that while I couldn't really use the money I 23 could go into Guinness & Mahon and draw against what 24 my guarantees, which I had already given them, 25 where, small amounts of money and that these 26 ...(INTERJECTION). 27 92 Q Had you an accountant at this time advising you on your own tax affairs? 28 29 I don't honestly know but I know that A Not really, no, I was -- this then just disappeared 17 2 93 Q 3 A 4 94 Q 5 A 6 95 Q 7 A 8 96 Q 9 A 10 97 Q Mr. Miller? 11 A Yes, sorry. 12 98 Q 13 A 14 99 Q 15 No, no. I just want to know ...(INTERJECTION)? Yes . You had to make ...(INTERJECTION)? We had ...(INTERJECTION). Mr. Miller? We moved ...(INTERJECTION). Mr. Miller? We moved ...(INTERJECTION). Just listen to the question? All right, yes. I want to know, did you have an accountant looking after your company's affairs? 16 A 17 100 Q 18 A 19 101 Q SKC? 20 A Yes . 21 102 Q 22 Yes . During ...(INTERJECTION)? Yes, SKC. Did you have a separate accountant looking after your own affairs? 23 A 24 103 Q 25 A 26 104 Q 27 A 28 105 Q 29 A No. Your own tax affairs? No. Did SKC look after your own tax affairs? Yes . They did? 1 106 Q 2 A 3 107 Q 4 A 5 108 Q 6 A 7 109 Q 8 No, it was then moved to their commercial side. I see? To their ordinary people. I see, yes? It moved out of there. During the period you were talking about they remained your accountants, is that right? 9 A 10 110 Q 11 Yes . Did you inform your accountant in SKC of the fact that there was money in this Guernsey company? 12 A 13 111 Q 14 A 15 112 Q No. You did not? No. During this period then the money was mounting up 16 and staying in the company and you were not 17 returning any of it to The Revenue, is that the 18 position? 19 A 20 113 Q 21 22 That is correct. All right. What occurred then? Would you just tell us what occurred briefly over the years then? A Over the years I occasionally said I wanted some 23 money from Guinness & Mahon and there was always a 24 little bit of a pause before I got it and then I 25 would go in and cash it, collect the monies. 26 wasn't very much. 27 things like that. 28 29 It We used it only for holidays and 1 115 Q 2 A 3 116 Q 4 A 5 117 Q 6 A 7 118 Q Yes . When you wanted money he would give it to you? Yes . Was it cash he usually gave you? Cash. Mr. Miller, I know it is over a period, of years, 8 but can you say was it regularly? 9 month or was it more frequently? 10 A 11 119 Q 12 A 13 120 Q 14 A 15 121 Q 16 Was it once a Look, I also had a credit card. Yes ? An American Express credit card. Yes? Which I used outside the country. If you would just listen to the question, Mr. Miller? 17 A 18 122 Q Yes, all right. I was asking you about going into Guinness & Mahon and seeing Mr. Collery? 19 20 A 21 123 Q 22 A 23 124 Q 24 A 25 125 Q 26 A 27 126 Q Yes . How often did you do that? I wouldn't do it -- 6 months, 12 months. Every year? For a holiday or something like that. I see. Yes? Yes . During this period did you become aware then of 28 Ansbacher? 29 ...(INTERJECTION)? Did you become aware of the existence of 2 127 Q 3 A 4 128 Q 5 6 You never heard of it? No. It was the money you thought was in Guernsey, and this is how you were ...(INTERJECTION)? A No, the money disappeared from Guernsey I think at 7 the time Traynor left. 8 ...(INTERJECTION). 9 129 Q 10 A 11 130 Q 12 A 13 131 Q 14 A 15 132 Q 16 A 17 133 Q 18 I don't know this Yes? Yes, but I know the money left Guernsey. Yes? And went to the Cayman Islands. Yes ? To Guinness & Mahon Cayman Islands. Guinness & Mahon Cayman Islands, yes? Yes . Mr. Miller, did you regularly get an account of the money that was there? 19 A 20 134 Q 21 A 22 135 Q No . Did you ...(INTERJECTION)? No . Were you from time to time given a slip of paper 23 like a bank statement with the top of the bank's 24 name ...(INTERJECTION)? 25 A 26 136 Q 27 A 28 29 No. Did you never get any statement at all? No. All I got -- when I asked for it I got bits of paper. 137 Q 1 2 138 Q 3 A 4 139 Q 5 A 6 140 Q 7 A 8 141 Q 9 A 10 No. You had no idea? Pardon? You had not idea? I had a vague idea but ...(INTERJECTION). What was the vague idea? I thought there was about £100,000 there or something. 11 142 Q 12 A 13 143 Q 14 A 15 144 Q 16 A 17 145 Q 18 A 19 146 Q Yes ? But you see the money was being paid in monthly. Yes? By British Ceedack. Yes? Half our commission, which was paid monthly. Yes ? And this mounted up. Then you would have an idea from -- if they were 20 putting in half your commission each month you would 21 have a idea? 22 A 23 147 Q 24 A 25 148 Q Well, this may seem very funny but I know I didn't. Yes ? It was just something that was there. Yes. At any rate Mr. Miller it is clear then that 26 your knowledge is that the money was transferred to 27 a Cayman company. 28 the company that it was transferred to -- its name 29 is now "Ansbacher"? I think you will agree now that 1 2 149 Q 3 A It was Guinness & Mahon. 4 150 Q It was Guinness & Mahon? 5 A 6 151 Q It was ...(INTERJECTION)? Yes . Yes. Mr. Miller, it would seem that you just did 7 not -- you had more than one account. 8 that the reference to your account was "B/Z"? 9 you know that that was the ...(INTERJECTION)? 10 A 11 152 Q 12 A 13 Did you know Did I had no idea there was any reference at all. Yes ? I thought I had to ring up the Cayman Islands to see what was there. 14 153 Q 15 A 16 154 Q Yes. You did not know? No, I didn't know. I had no idea. When Mr. Traynor moved, left, Guinness & Mahon, did 17 you go to Mr. Traynor personally when you wanted 18 money? 19 A 20 155 Q 21 A I only saw Traynor once. I see? At the beginning of the thing when I went in. It 22 was five minutes and he looked as if to see were my 23 shoes polished. 24 156 Q 25 A 26 157 Q 27 A 28 158 Q 29 Did you see Mr. Collery then? Collery was the contact. He was your contact? Yes . When Mr. Collery left Guinness & Mahon then, where did you go? 1 2 159 Q 3 A 4 160 Q 5 A 6 161 Q 7 A 8 162 Q 9 A 10 42 Fitzwilliam Square? Yes . That was CRH Headquarters? CRH, yes. Yes. Who did you see there? Collery. I see. But I didn't go very often. I went there once to collect money. 11 163 Q 12 A 13 164 Q 14 A Once? Once . Was this ...(INTERJECTION)? In my recollection I only went once and I used to 15 ring Collery up and say, "Look, Padraig I want 16 £2,000 quid, I am going away." 17 165 Q 18 A 19 166 Q 20 A 21 167 Q 22 A Yes ? Or something like that. Yes? That is when things changed. Yes? I stopped going to the bank and I started getting 23 very uneasy, very, very uneasy, about the whole 24 thing. 25 168 Q 26 A Yes ? Because up to that it was my -- I felt that it was 27 absolutely legal. 28 was only borrowing against monies which were 29 overseas, that it was going through. I was doing the right thing. I 1 169 Q. 2 A. 3 Yes? And I had no idea. Then I thought, "Christ almighty what is going on?" 4 170 Q. 5 A. 6 171 Q. 7 A. 8 172 Q. 9 A. 10 Yes? Bits of paper ...(INTERJECTION). When was ...(INTERJECTION)? With balances on it ...(INTERJECTION). What was it? Bits of paper with balances on it? Balances on it, backs of envelopes, things written down ...(INTERJECTION). 11 173 Q. 12 A. Collery. 13 174 Q. Collery? 14 A. 15 Who would give you those? Yes. I would ring up screaming and wanting to know how much money was there. 16 175 Q. 17 A. 18 176 Q. 19 Yes, and he gave you bits of paper? And I had bits of paper, which I read and tore up. Would I be correct in saying that the bits of paper were, in fact, like a bank statement? 20 A. 21 177 Q. 22 A. 23 178 Q. 24 A. No. Were they ...(INTERJECTION)? No, not in the least like a bank statement. Were they hand written? They were just scribbled pieces of paper, "So much 25 in dollars, so much in so and so, and so much in so 26 and so and so and so". 27 17 9 Q. 28 A. 29 That is what I am coming to? And the total then. 1 2 181 Q 3 A 4 182 Q 5 6 No, no. Did you have an account in other currencies, in Deutschemarks ? A 7 They were in Deutschemarks for some reason or another but I don't know why. 8 183 Q 9 A 10 184 Q 11 A 12 185 Q 13 A 14 186 Q 15 A 16 187 Q 17 A 18 188 Q 19 Then ...(INTERJECTION)? But there were. Just take it in stages? Yes, okay. Did you not have a Deutschemark account? I think there were Deutschemarks in it. Did you not have a Yen account, Japanese Yen? I do not remember Yen coming into it. Did you have an ECU account? No. No, I didn't. What accounts do you think you had? In what currencies do you think you held the money? 20 A 21 189 Q 22 A I honestly don't know. Yes? And I don't know how it would have got into a 23 different currencies. 24 right about that but I think there were various 25 currencies. 26 there were just bits of paper and all I was 27 interested in was the net figure. 28 I know? 29 I don't know whether I am Well, whether they were -- I know that 1 191 Q 2 I know that Mr. Miller but I want you to be careful now and I want you to be accurate? 3 A 4 192 Q 5 A 6 Well, I am being as accurate as I can. Yes ? I have a vague idea you they were written down in ...(INTERJECTION). 7 193 Q 8 A 9 No, just listen to the question, Mr. Miller? Yes. I see what you are trying to ...(INTERJECTION). 10 194 Q 11 A 12 195 Q Mr. Miller, would you just listen to the question? Right, right. The question is that you had a number of accounts in 13 different currencies and I am asking you, if that is 14 correct? 15 A 16 196 Q 17 A 18 197 Q 19 A 20 21 And that you had ...(INTERJECTION)? That is not correct. Sorry? That I had a number of accounts in different currencies. 198 Q 22 23 No. All right. Then you have agreed that you think you had one in German, in Deutschemarks? A No, no, I only said that I thought there were. I 24 had only one account and that account was 25 with Guinness & Mahon and is it was entirely managed 26 by them. 27 No, but in what currency was it? 28 As far as I -- it was pounds as far as I was 29 concerned. I wasn't even concerned whether it was 1 Irish pounds or English pounds at that time. 2 was interested -- I am a very careless sort of guy 3 actually and how -- all I wanted was a net figure 4 in Irish. 5 -- it was just extra money. 6 200 Q 7 A 8 201 Q 9 A 10 202 Q 11 A 12 203 Q 13 A 14 204 Q All I I suppose I didn't even realize whether If you just keep to the question, Mr. Miller? Yes . That I am asking you? Yes , I am just trying to ...(INTERJECTION). I am asking you about ...(INTERJECTION) I am letting my brain wander over. Yes ? To get an answer for you. Yes. The question was: Did you have the money that 15 you held overseas in accounts in foreign currency 16 including German Deutschemarks? 17 A 18 205 Q 19 A 20 206 Q 21 I don't think I had. Did you have them in US dollars? No. I want to -- if you could get the document at tab 6 please? 22 A 23 207 Q 24 Well, US dollars wouldn't have meant anything to me. There is a letter I would like you just to look at of the 23rd October 1990 (Exhibit 1)? 25 A 26 208 Q Yes . It is addressed by Mr. Traynor to Mr. Humphries in 27 Guinness & Mahon. 28 would like you to look at: 29 It is the second paragraph that I "Could you also please arrange to let me have for collection on Thursday two 1 lots of Travellers cheques each of us $1,000 issued in the names of Mr. G. Miller and Mrs. M.V. Miller. Please debit the cost to "Ansbacher Limited" account number..." 2 3 4 5 And the account number is given? 6 Yes . 7 209 Q In fact, Mr. Miller that account number was a -­ 8 would you hand the next document to the witness. 9 That account number was a US dollar account number 10 and the reference to the account is B/Z. 11 would look at the top there: 12 "B/Z Copy Statement. If you (Exhibit 2)" 13 14 and it is £2,000. 15 these documents seem to establish that you had an 16 account with "Ansbacher" and that the account was 17 this numbered account, which I have given you, and 18 that it was in US dollars. 19 there at the top it was in "B/Z", that seems to be 20 your account? 21 A 22 Yes. What I am suggesting is that Well, you say that. If you see the reference I have never heard of "B/Z". 23 210 Q 24 A 25 211 Q 26 A 27 212 Q Yes. You have never heard of it? I just don't know. Why I am asking you about it is? Yes . That there is also a document which -- if you would 28 just hand it to the witness. 29 "Ansbacher Limited" document, which shows the It is an internal 1 different accounts that Ansbacher had and if you 2 would hand it to the witness. 3 there in red. There is a reference "B/Z", do you see 4 (Exhibit 3)? 5 A. 6 213 Q. I see "B/Z", yes. The Deutschemark is on the right and number of the 7 account is on the left. 8 your accounts? 9 A. It is highlighted I am wondering were those Yes, I can see no reason for it. The US dollars, I 10 might have been on holidays in Florida or somewhere 11 like that. 12 214 Q. No, I am not concerned about holidays? 13 A. I have no knowledge of these accounts. 14 215 Q. 15 A. 16 216 Q. 17 A. 18 217 Q. You have no knowledge? No. Very well then? No knowledge whatsoever. Very well. There is another letter then on the 19 11th April 1990. 20 April 1990. 21 Ansbacher letter to Mr. Humphries 22 MS. MACKEY: It is just before page 28. MR. JUSTICE COSTELLO: Just before page 28. Do 23 218 Q. It is behind this one. 24 25 26 27 28 29 Have you got a copy of that, 11th It is an (Exhibit 4). you see that this is from Mr. Traynor to Mr. Humphries: "Dear David Could you please arrange to purchase Stg. £45,000 worth of US Dollars and credit the Dollars purchased to Ansbacher Limited..." 1 2 "The stg. £45,000 should be debited to Ansbacher Limited account number 131,546.02." 3 4 5 A. 6 219 Q. 7 Yes. These are the accounts numbers which you have indicated before. 8 A. 9 220 Q. 10 A. 11 221 Q. Do you recall that transaction? No. You do not? No. Very well. There was a letter, there was another, 12 transaction. 13 you recall when Miller & Son got a loan from 14 Guinness & Mahon in 1977? 15 transaction, a loan for £20,000, and it was secured? 16 It was secured by a deposit from one of the 17 subsidiaries of the company. 18 Do you remember getting a loan 19 A. 20 222 Q. 21 A. 22 223 Q. 23 A. 24 224 Q. 25 A. 27 225 Q. 28 A. Do Do you remember that Do you remember that? (Exhibit 5)? I haven't seen these document. The documents? And I don't, in fact, remember the loan. You do not remember the loan? No. Yes. You do not remember how the loan, if there was a loan, was secured? 26 29 I think, an earlier transaction. Yes. You do not remember that? I have seen these documents and what it says on 1 the Moriarty thing and there was £20,000 loan 2 guaranteed by a house which I owned in 21 Rosmeen 3 Park. 4 5 A. And there was -- I also saw a copy memorandum from 6 Guinness & Mahon, a internal memorandum, stating 7 this loan, mentioning this loan, with 21 Rosemeen 8 Gardens marked on it and below that there was this 9 statement: 10 227 Q. 11 A. 12 228 Q. 13 A. 14 229 Q. 15 A. Yes. "Suitably guaranteed". You do not ... (INTERJECTION)? I know nothing about that. Right? At all. I see? All I know is that I must have got a loan because I 16 got -- I have a letter, which I got last year from 17 the Moriarty Tribunal, a copy of it, to me saying 18 that they were giving me a loan of £20,000. 19 230 Q. 20 A. 21 Yes? That was never fully drawn as far as I can see. There was only £11,000 and it rolled over to 1978. 22 231 Q. 23 A. 24 232 Q. Yes. Well, ...(INTERJECTION)? That is, as far as I understand, that thing. Right. Mr. Miller, if I could then summarise: The 25 position is that for over a number of years you had 26 money offshore and eventually it came into a company 27 in the Cayman Island, which is now known as 28 "Ansbacher". 29 this period you would have earned interest on that, Am I correct in saying that during 1 2 Well, I don't think that is quite correct, Sir. 3 had money. 4 233 Q 5 A 6 234 Q 7 A I There was monies overseas. Yes ? In a company. Yes? Which British Ceedack were paying to look after 8 their interests in Ireland and I gave securities to 9 Guinness & Mahon for monies which I may have 10 borrowed. 11 there were always securities to Guinness & Mahon by 12 me . 13 235 Q 14 A 15 236 Q 16 I can't remember this particular one but Was ...(INTERJECTION)? And they were personal loans made to me. I am not talking about the loans, Mr. Miller. I am talking about the money that was abroad? 17 A 18 237 Q 19 A 20 238 Q 21 A 22 239 Q 23 A 24 240 Q 25 A 26 241 Q 27 A Yes . With the ...(INTERJECTION)? Well, the money abroad just went there. Yes? And I didn't know who it belonged to. Yes? I couldn't make it out. Mr. Miller, did it not earn interest? It did, of course. You did not return it? I didn't return it, no, but this money was -- as far 28 as I was concerned it belonged to the company that 29 had been formed by British Ceedack Limited. 1 242 Q 2 A 3 243 Q 4 5 A Any tax that I have had -- these figures were gone through when I took the amnesty. 244 Q 8 Sorry, this is what I want to find out. You took the amnesty, did you? 9 A 10 245 Q 11 A 12 246 Q 13 A 14 15 Do you think now that you had any liability for tax in relation to it? 6 7 It wasn't anything to do with me. I took the amnesty. Yes ? In 1994. Yes. I see. Very well then? And everything was gone through and I am clear. have a certificate. 247 Q That is what I wanted to get you to assist us on 16 now. 17 when did you approach The Revenue and seek an 18 amnesty? 19 A 1994. In 1994, then, was it? When did you take -­ Wasn't it the last amnesty I took? 20 got my bloody things here with me. 21 was 1994. 22 and I got this ...(INTERJECTION). 23 248 Q 24 A 25 26 I I haven't I think it Wasn't it 1994, the last amnesty I took I do not know which, Mr. Miller? I think there were two amnesties. I took the second one . 249 Q 27 Sorry, what are you doing Mr. Miller? what are you doing? 28 A 29 250 Q The figures are not -- are private. Yes? Mr. Miller, 1 They were given to me as private. 2 bottom part belonging to me. 3 251 Q 4 A 5 252 Q 6 A 7 253 Q 8 A 9 254 Q 10 A 11 No, Mr. Miller. If -- just a moment. Right. I am not interested in ...(INTERJECTION)? All right. In the figures. Okay. I am just interested in ...(INTERJECTION) All right. MR. MOHAN: There is no difficulty 12 with this. 13 14 MR. JUSTICE COSTELLO: A 15 Yes. There is no difficulty with my ...(INTERJECTION). MR. MOHAN: That is a copy and I can 16 show you the original of 17 18 This is the that, Judge. A I am sorry Judge. I just -- it seemed to me the 19 bottom part was the only part that was cognisant to 20 this . 21 255 Q MR. JUSTICE COSTELLO: 22 Am I correct in understanding that 23 included in this certificate was a sum in respect of 24 interest which you may have earned? 25 A 26 256 Q 27 A 28 257 Q 29 It was the whole lot. Yes? Yes . What your evidence is is that in respect of the tax liability for the arrangements, which you have 1 described to us, you have availed of the amnesty and 2 have obtained a certificate in relation to it? 3 Exactly. 4 Very well then. 5 M R . MOHAN: 6 that certificate if you 7 8 We have the original of want to see it. 259 Q MR. JUSTICE COSTELLO: 9 We do not need the original. If you could 10 give us a copy we could . (INTERJECTION)? 11 M R . MOHAN: We will give you a clean 12 copy, yes. 13 MR. JUSTICE COSTELLO: Give us a photostat of it. 14 M R . MOHAN: Yes . 15 MR. JUSTICE COSTELLO: Yes . 16 M R . MOHAN: What my solicitor might 17 do, because there is a 18 statement, is we can sent on the statement together 19 with that to you later on today in you wish. 20 MR. JUSTICE COSTELLO: 21 All right. That would be helpful. 22 A 23 260 Q 24 I thought you were aware of this. No, Mr. Miller, we are not concerned with the amounts at all? 25 A 26 261 Q 27 Yes . What I am concerned about is to ascertain ...(INTERJECTION)? 28 A 29 262 Q Okay. Whether or not you have affected a settlement with 1 2 3 263 Q. 4 A. 5 264 Q. You tell me that you have? Yes, yes. MR. JUSTICE COSTELLO: 6 Mr. 7 8 Okay. Very well Miller, that is all I want to ask you. A. Yes. 9 10 END OF EXAMINATION OF MR. MILLER BY MR. JUSTICE 11 COSTELLO 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 MS. MACKEY: I would just like to ask 4 you a few questions 5 Mr. Miller, just to clarify a few things that I was 6 not clear on from your evidence at the start. 7 relation to the setting up of this scheme -- that 8 you were advised by Mr. Reid in SKC how to set up 9 this scheme. 10 11 In Could you just tell me exactly what he advised you at that time? A He advised me that it was a scheme where -- I will 12 never get the word right. 13 was being paid commission. 14 2 66 Q 15 A 16 There was a -- that as I Yes? And that there was a lawful scheme that could be set up. 17 267 Q 18 A 19 Right? That would avoid tax for me -- avoid me declaring certain amounts of money which were due. 20 268 Q 21 A 22 Yes? How should I put it? He just said he knew how he could save me tax. 23 269 Q 24 A 25 270 Q 26 A 27 271 Q Yes ? I suppose that is what it was. Mr. Miller ...(INTERJECTION)? And he set up a scheme. Sorry, to cut across you now but just not to delay 28 this matter too long. 29 or he told you, this was a lawful scheme, is that He gave you the impression, 1 2 3 272 Q. 4 A. 5 What year did this happen? 19 -- now, this I can't tell you because I know that it was early 1970's. 6 273 Q. 7 A. 8 Early 1970's? Yes. It must have been early 1970's and I have no way of finding out. 9 274 Q. 10 A. 11 275 Q. 12 A. 13 276 Q. 14 Everything is destroyed. Yes? I mean we destroyed everything after. Now, he ...(INTERJECTION)? It was thirty years ago. He suggested -- did he actually suggest to you that your distributor in England should set up a company? 15 A. 16 277 Q. 17 A. 18 278 Q. 19 A. He suggested that a scheme. Yes? Whereby this company was set up. Yes? And providing the principals were willing to allow 20 this company to look after their interests in 21 Ireland, they would pay them a certain figure which 22 was half our commission. 23 279 Q. Right. You said, just there towards the end, that 24 you were not sure who owned this money or whether it 25 was yours or not. 26 A. 27 280 Q. 28 A. 29 281 Q. But I was sure. How ...(INTERJECTION)? It wasn't mine. How ...(INTERJECTION)? Otherwise I would have declared it. How were you to benefit from that money? 1 That was the whole bloody problem of why I took the 2 amnesty. 3 282 Q 4 A 5 283 Q 6 A 7 284 Q Well, no ...(INTERJECTION)? I was in a ...(INTERJECTION). Sorry, Mr. Miller? I was in a catch ...(INTERJECTION). Sorry Mr. Miller. Just getting back to the time it 8 was set up. 9 method of lawful tax avoidance? 10 A 11 285 Q 12 A 13 286 Q 14 A 15 287 Q 16 A Mr. Reid advised you that this was a Of course. Now, ...(INTERJECTION)? I was told by everybody that it was legal. However, you were not giving away your money? No. It was going to be your money, is that right? No, I wasn't. Maybe I would go and live in Spain 17 some time or South Africa of something like that. 18 It was a sort of a ...(INTERJECTION). 19 288 Q 20 A 21 289 Q 22 23 You thought you might use it later on? Yes, I didn't need the money. Yes. At what stage did it become clear to you that you could draw money from Guinness & Mahon? A Well, that is a very difficult question to ask. I 24 didn't really -- I didn't think much about it. That 25 money was over there. 26 and look into ...(INTERJECTION). 27 290 Q No, I understand that, but at the time ...(INTERJECTION)? 28 29 As I said I mean I didn't go A No, but you are asking me at which stage did I think 40 1 2 291 Q 3 A 4 292 Q 5 A 6 293 Q 7 Yes ? I never. I never used it. Mr. Miller? To my knowledge. Sorry, Mr. Miller, you made withdrawals from Guinness & Mahon, is that not correct? 8 A 9 294 Q 10 A 11 295 Q Yes . For travellers cheques? Various things like that, yes. Yes. Was that money, that you withdraw from 12 Guinness & Mahon, the money that was being paid into 13 the company in Cayman? 14 A 15 296 Q 16 A No, no, it was against my guarantees. What do you mean by that? You had 21 Rosemeen Gardens then. It says quite 17 clearly on the things that Rosemeen Gardens is 18 against securities that Guinness & Mahon had. 19 was £40,000 quids worth of securities that 20 Guinness & Mahon had. 21 me against. 22 me. 23 297 Q There That is what it was given to I have the letters. I have letters to I am not clear about this, Mr. Miller. When you 24 went to Padraig Collery and you asked him for money, 25 that money coming out of an account that you had, is 26 that not correct? 27 A 28 298 Q 29 A Look, it came clear to me ...(INTERJECTION). No? That there was -- excuse me now, you are asking me 41 1 2 299 Q 3 A 4 300 Q 5 A 6 301 Q No, just a moment now. MR. JUSTICE COSTELLO: MR. JUSTICE COSTELLO: A All right. Yes, Okay. MR. JUSTICE COSTELLO: 10 not a Court. A Yes . MR. JUSTICE COSTELLO: 13 15 A And it is not a Tribunal. Right, Okay. MR. JUSTICE COSTELLO: 16 You are here to assist us because we have to report 17 this . 18 Yes . 19 MR. JUSTICE COSTELLO: Well, I ...(INTERJECTION). 20 21 Mr. Miller, I told you at the beginning that this is 11 14 Mr. Miller, would you keep quite for the moment? 9 12 Mr. Miller? No, but what ...(INTERJECTION). 7 8 I am here ...(INTERJECTION). No, Mr. Miller, would you listen to the question? I wonder if I could have M R . MOHAN: 22 an opportunity. It might 23 in ease in cooperation of the ...(INTERJECTION). 24 MR. JUSTICE COSTELLO: Yes . 25 M R . MOHAN: If I could have five 26 minutes with my client. 27 MR. JUSTICE COSTELLO: Yes. 28 M R . MOHAN: Yes . 29 MR. JUSTICE COSTELLO: 42 Very well. 1 2 SHORT ADJOURNMENT 3 4 302 Q 5 A 6 303 Q 7 MR. JUSTICE COSTELLO: I am sorry about that. I am getting highly strung. MS. MACKEY: That is all right. I understand. A I am getting carried away with this whole business. 10 MS. MACKEY: Yes. 11 MR. JUSTICE COSTELLO: Very well. 12 Miller? Yes . 8 9 Yes, Mr. A I haven't been at a court for 20 years. MR. JUSTICE COSTELLO: 13 14 A 15 304 Q Very well, Mr. Miller. Yes, look ...(INTERJECTION). MS. MACKEY: 16 Actually Mr. Miller it would actually facilitate 17 the whole thing? 18 A 19 305 Q Yes . And make it shorter if I could just ask you 20 questions and you could just answer the specific 21 question? 22 A 23 306 Q Yes. Right, well ...(INTERJECTION). And if you feel that the questions is such that you 24 need to give me a further explanation just say to 25 me, you know, "I can't answer that yes or no and I 26 would like to elaborate," then we will get along, I 27 think, quicker? 28 29 A Right. 1 2 The question that I was asking you before the break 3 there was, whether at what stage -- maybe I could 4 rephrase it. 5 with Guinness & Mahon in connection with this whole 6 matter, roughly? 7 A Early 197 0's . 8 309 Q Early 197 0's ? 9 A When did you first come in contact Yes, I had had an account with them. 10 should qualify that. 11 from 1966. 12 310 Q 13 A 14 311 Q 15 A 16 312 Q 17 A 18 313 Q 19 A 20 21 I think I I had an account with them Yes ? I know that because ...(INTERJECTION). With Guinness & Mahon itself? In Guinness & Mahon itself. Yes ? Yes, I was always a customer there. Right. The fact that they got involved with that and that I had an account was purely coincidental. 314 Q Right. In the early 1970's you say you came in 22 contact with them in connection with this matter. 23 Was that in contact with Mr. Traynor? 24 A I knew that Guinness & Mahon -- I knew that 25 Guinness & Mahon were managing the fund but 26 ...(INTERJECTION). 27 315 Q 28 A 29 How did you know that? Because it was being managed by Guinness & Mahon in the Isle Of Man. 1 316 Q 2 by Guinness & Mahon in the Isle Of Man? 3 A 4 317 Q 5 When the company was formed in the early 1970's. You knew then that Guinness & Mahon were managing it? 6 A 7 318 Q 8 9 However, when did you learn that it was been managed Yes . Yes. When did you meet Mr. Traynor for the first time? A As far as I can recollect it was in the early 10 1970's. 11 where I meet him. 12 office. 13 319 Q 14 A Right. I am trying to think about it. I know I know it was in CRH's head How did that arise? It would have when I started to get -- in fact it 15 arose I think because somebody in Guinness & Mahon, 16 probably Padraig, 17 this, brought me over to be vetted by Traynor. 18 320 Q 19 20 I couldn't be absolutely sure on Why did somebody, whoever it was, bring you over to be vetted by Traynor? A 21 To look after this account which -- to look after this account in Jersey. 22 321 Q 23 A Well ...(INTERJECTION)? Or to see if I was a fit person to -- I suppose to 24 be honest with you it would be -- if I was a fit 25 person to be a member of what they -- just to 26 associate with him or that he would associate with 27 or he would accept me. 28 Was this before this before the setting up of the 29 scheme in Jersey? 1 No, no, it was -- I can't honestly remember but -­ 2 no, it was after it I am sure. 3 after it. 4 323 Q 5 You went into Guinness & Mahon and somebody there brought you over to see Mr. Traynor? 6 A 7 324 Q 8 9 It was definitely Yes . Why did you go into Guinness & Mahon on that occasion? A 10 I have no idea. ago. 11 325 Q 12 A 13 326 Q Okay. 14 A Yes . 15 327 Q 16 A 17 328 Q 18 A 19 329 Q 20 A 21 330 Q I have no idea. This was 30 years 25/30 years ago. You cannot remember? No idea. I honestly haven't -- I ...(INTERJECTION). No, you cannot remember, that is fine? I mean just say that you cannot remember? Right. And it is a long time ago? It is a long time ago. We appreciate that? Yes . Anyway what you do remember is that you went to 22 Guinness & Mahon, for whatever reason you cannot now 23 remember, but somebody from there brought you to 24 Mr. Traynor in CRH? 25 A 26 331 Q Can you remember what transpired there? 27 A Yes, he talked to me about the weather. 28 332 Q 29 A That is correct. Yes? It was a nice day and where had I been on my 46 1 holidays. 2 333 Q 3 A 4 5 334 Q Did he not say anything to you about ...(INTERJECTION)? 7 A 8 335 Q 9 A 10 336 Q 11 A 12 337 Q 13 A 14 No. The purpose of your visit? No, nothing. Did you ask him anything ...(INTERJECTION)? No. About the purpose of the visit? No. I thought it was the most peculiar interview I had ever had. 338 Q 16 What happened after that interview then in relation to this affair? 17 A 18 339 Q Sorry? What happened after? What was the next step after that interview? 19 20 And it lasted five minutes and I went out and wondered what all that was about. 6 15 Yes ? A There were no particular developments except 21 everything just went on. 22 what it was all about but that is when I met him, 23 the only time I met Traynor. 24 340 Q 25 A 26 341 Q I suppose I don't know That is the only time you met Traynor? I thought he had a very big office. To get back to the question I asked you first, 27 following that, at some stage after that, you 28 became aware that you could withdraw money from 29 Guinness & Mahon? 1 2 342 Q. 3 A. 4 5 Right. How did ...(INTERJECTION)? With my own -- with my securities. them securities. 343 Q. 6 The money that you were withdrawing was what? A. 8 344 Q. 9 A. 10 345 Q. 11 A. 12 346 Q. In Ireland? 13 A. In Ireland. 14 347 Q. 15 It was a loan. It was not your money? It was a loan. A loan made to you by who? By Guinness & Mahon. Have you documents to show that you got these loans and Guinness & Mahon in Ireland? 16 A. 17 348 Q. 18 A. 19 349 Q. 20 A. 21 Absolutely. Can you provide those to us? I forgot my briefcase but they are at home. Yes? I got them out and I ...(INTERJECTION) MR. MOHAN: 22 24 Was it a loan? 7 23 I had to give They were again given to us ...(INTERJECTION) A. Given to us by ...(INTERJECTION). MR. MOHAN: By the Moriarty. We will 25 give to you what they gave 26 to us and again will show what the witness is saying 27 in relation to loans draw downs secured against the 28 property. 29 We will give you the documentation. 1 2 wish to ask any further 3 4 questions we will return obviously. 350 Q MS. MACKEY: 5 6 Right. Very good. So ...(INTERJECTION)? A They were letters to me acknowledging my loan and on 7 such and such terms with whatever security I had 8 given them. 9 351 Q Mr. Miller, the withdrawals or the money that you 10 obtained from Guinness & Mahon in travellers 11 cheques, they were borrowings? 12 A 13 352 Q 14 15 They were borrowings, yes. Yes. When did you close your Ansbacher account, Mr. Miller? A Well, when I took the -- I hadn't got an account as 16 far as I was concerned with Ansbacher. 17 1974 and the money ceased going into the Isle Of Man 18 company. 19 353 Q 20 A 21 354 Q 22 A 23 I retired in Yes? Because I sold the business. Yes? And we informed the people that this account was there and it belonged to Ceedack but it was stopped. 24 355 Q 25 A 26 Yes ? Or Ceedack must have informed them that there was an account but the whole thing changed. 27 356 Q 28 A 29 357 Q Yes? I sold the business. Yes? 1 2 358 Q. 3 A. 4 359 Q. 5 A. 6 360 Q. Yes? Anything in ...(INTERJECTION). Mr. Miller, you ...(INTERJECTION)? So, the money ...(INTERJECTION). You have shown us a certificate that indicates that 7 you availed of the amnesty, the last tax amnesty. 8 That was in respect, you have told us, of the 9 interest that accrued on that account, the offshore 10 account, is that correct? 11 A. No. 12 361 Q. No? 13 14 It including that, was that your evidence to us ? A. 15 The whole lot of the money was paid and I have paid my dues to The Revenue Commissioners. 16 362 Q. 17 A. 18 363 Q. 19 A. 20 I understand that? And I am now clear. I understand that? With The Revenue Commissioners. My tax affairs are in order. 21 364 Q. 22 A. 23 365 Q. Yes, I understand that? Absolutely. However, part of what is covered by the settlement 24 that you made with The Revenue was interest that 25 accrued on the Ansbacher account, is that correct? 26 A. The total amount I — there was a deal done or there 27 was -- I became uneasy and had been uneasy since I 28 started getting bits of paper and I couldn't get a 29 business like reply to where or what this money or 1 2 3 66 Q 3 A 4 367 Q 5 A 6 Yes ? Or what was going on at all. Yes ? And this business of collecting monies in hotels and things ...(INTERJECTION). 7 368 Q 8 A 9 369 Q 10 A 11 370 Q Yes? Was not on for me. Yes ? And I wanted out. MR. JUSTICE COSTELLO: 12 Could I stop you. You are going to give us a 13 document which indicates the basis on which the 14 certificate was given, is that right? 15 MR. MOHAN: 16 I am going to give you the certificate, as I 17 understand it and these are my instructions that, at 18 the time, and I am paraphrasing some of the evidence 19 to this point which may be useful and you may wish 20 to ask some questions on it, that he had misgivings 21 at a point in time. 22 Mr. Reid, and he went into Mr. Reid at that time and 23 he said, "I want this to stop." 24 371 Q MR. JUSTICE COSTELLO: 25 He went in. He used SKC, Mr. Mohan, could I interrupt you? 26 MR. MOHAN: Yes. 27 MR. JUSTICE COSTELLO: The witness clearly stated 28 29 what M s . Mackey has indicated to him in answer to me. 1 2 MR. JUSTICE COSTELLO: Which is, that part of the 3 tax amnesty that he got a 4 certificate for was in respect of tax on interest 5 abroad. 6 MR. MOHAN: Yes. 7 MR. JUSTICE COSTELLO: Which he had not 8 disclosed. 9 MR. MOHAN: Yes. 10 MR. JUSTICE COSTELLO: That is what he said. 11 MR. MOHAN: Well, 12 MR. JUSTICE COSTELLO: He is going back on that ...(INTERJECTION) now. 13 14 MR. MOHAN: Well, my understanding -­ 15 you may take that from it 16 but my understanding is evidence was as follows 17 ...(INTERJECTION) 18 MR. JUSTICE COSTELLO: Sorry, Mr. Mohan. 19 We seem to be -- I thought we were 20 going to be able to finish this very quickly. 21 looks as if we cannot now. 22 MS. MACKEY: Yes, please do. MR. JUSTICE COSTELLO: Mr. Miller, I think there 23 372 Q 24 It May I take over? may have been -- I did not 25 think there was a misunderstanding but I understand 26 that there may be. 27 carefully to the questions. 28 abroad was earning interest. 29 this to the Revenue. I want to you listen very The money which you had You did not declare You then went to the Revenue 1 and availed of the tax amnesty. 2 tell me earlier today that in relation to the 3 amnesty that included the tax which you had not paid 4 on the interest which had been earned abroad, was 5 that correct? 6 That is correct. 7 373 Q I understood you to That is correct. 8 MR. MOHAN: Included, yes. 9 MR. JUSTICE COSTELLO: Yes. MR. MOHAN: It was the entire sum? 10 11 A 12 13 MR. MOHAN: A 14 15 It was the entire sum. Yes. Everything ...(INTERJECTION) MR. MOHAN: A Yes. Everything was completely declared to 16 The Revenue Commissioners. 17 MR MOHAN: 18 19 20 That is the point I wanted to ...(INTERJECTION) A The whole thing. MR. MOHAN: 21 Subject to make -- was that he went into Mr. Reid 22 and he wanted it closed down. 23 was there was then declared to The Revenue and 24 interest paid on it. 25 may have been due in relation to interest earned so 26 be it, but it was the entire amount. 27 not a matter of ...(INTERJECTION). 28 29 So, whatever money If that then included tax that It simply is 1 2 3 Yes . 375 Q We are to ascertain who held these interests abroad 4 and whether tax was paid on them. 5 your evidence that you had monies abroad; that tax 6 was not paid on them; that you now admit that tax 7 should have been paid; that you — 8 in the amnesty that you entered into with The 9 Revenue, is that correct? 10 A 11 376 Q 12 it was included That is correct. Thank you. MR. MOHAN: It was done so, I think, 13 in fact, by SKC, who 14 15 I understand from processed the amnesty. A SKC -- I went to SKC and said, "What am I going to 16 do?" 17 thing." 18 went to the Revenue Commissioners, 19 about it. 20 figures back from whatever it was necessary, 21 answered all the questions and we paid up. 22 MR. MOHAN: He said, "Don Reid is the one to settle this He settled it all up and he settled it. 23 24 A 26 MS. MACKEY: 29 He explained everything. He got all the That is simply the point I And I said, "Thanks goodness we are finished with this." 28 spent some time wanted to make. 25 27 He Very good. Then Mr. Miller, at what point in time did you begin to contact Mr. Collery? 1 2 378 Q 3 A 4 379 Q 5 A 6 380 Q 7 A 8 381 Q 9 A In Guinness & Mahon. Yes, but ...(INTERJECTION)? He was an employee of Guinness & Mahon. Yes? It was with him that I dealt with the thing. Yes? Obviously, I dealt with the banking people when I 10 was getting -- but Collery -- I just don't know. 11 met Collery. 12 382 Q 13 A 14 15 16 17 He was just part of the furniture. Were you introduced to him by somebody else there? There was nothing particular, whatever. 383 Q Yes. "This is Paddy," or He was just there. You contacted him for what purpose generally speaking? A I didn't contact him for any particular purpose. 18 was just there. 19 left Guinness & Mahon and then he was the only 20 person I could contact. 21 Guinness & Mahon and did my usual trading as you 22 would in a bank. 23 384 Q 24 A 25 385 Q 26 27 I He I didn't contact him until he I just went into Right? "Hello Tom," or "Hello Fred," or whoever. When Mr. Collery left, why did you not continue to do that? A Well, because Collery had been -- had left Guinness 28 & Mahon and he wasn't there and he turned out -- he 29 said he was managing the affairs now. 1 386 Q 2 A 3 4 Well, obviously the affairs of the accounts which were overseas, the whole ...(INTERJECTION). 387 Q 5 At that point you knew, in fact, that it was not Guinness & Mahon that was ...(INTERJECTION)? 6 A 7 388 Q 8 A 9 389 Q Look, I knew all along. Yes? All right, no. Yes. Obviously, yes. When did you it -- it was in 1993 then that 10 you dealt with Mr. Collery or just before the tax 11 amnesty that you dealt with Mr. Collery for the last 12 time? 13 A 14 No, I had been dealing with Mr. Collery for some time . 15 390 Q 16 A 17 391 Q 18 A Yes? Yes . You were going to see him in CRH, I think you said? I don't think I actually went to CRH. I went 19 to CRH to pick up money once but I would ring him up 20 in CRH and say ...(INTERJECTION). 21 392 Q 22 A 23 393 Q Yes? "Give me some dough". Yes. On the occasion in which you went there, to 24 pick up some money, was that -- was that during 25 working hours, weekends, evenings can you remember? 26 A 27 394 Q 28 A 29 395 Q I went once. Yes? I didn't go regularly. I went once. 1 And as far as -- I don't -- somebody there handed me 2 -- it must have been during working hours because 3 there were people moving around the offices and 4 somebody handed me a paper envelope. 5 396 Q 6 A 7 397 Q 8 A 9 398 Q 10 A 11 399 Q 12 A 13 400 Q 14 A 15 401 Q Did you not meet Mr. Collery himself? No, not on that occasion. Can you remember who handed you the paper envelope? It was a woman. Was it Ms. Williams? I have no idea. You do not know? No. Do you know Ms. Williams? I don't know Ms. Williams. Right. I do not have any more questions Mr. Miller. 16 Thank you very much. 17 All right. 18 END OF EXAMINATION OF MR. MILLER BY MS. MACKEY 19 20 MR. JUSTICE COSTELLO: 21 Mr. Miller, thank you for your attendance today. We 22 require you to sign the transcript of this evidence. 23 If will be typed up and it will be available in the 24 next couple of days and we will get word to you and 25 if you would come in and sign it. 26 MR. MILLER: 27 28 29 Thank you very much. apologise ...(INTERJECTION) I 1 2 ...(INTERJECTION) 3 MR. JUSTICE COSTELLO: All right Mr. Miller. 4 MR. MILLER: I am very highly strung at the moment. 5 6 MR. JUSTICE COSTELLO: I understand. 7 MR. MOHAN: We will send on the 8 9 documentation. If there is any issues that arise, of course, we will be 10 available for re-interview. 11 MR. JUSTICE COSTELLO: 12 Very well. Thank you very much. 13 MR. MOHAN: Thank you very much. 14 MR. MILLER: Thank you. 15 MR. JUSTICE COSTELLO: Very well. 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED. THE EXAMINATION W18 CONCLUDED . .066 \m?w Cuwxwg 7 er'xk. Ag 00 A U a n b tr « f th t B m ry A iu bachtr H oldings F LC M erchant B anking G roup rm m , Please reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 P.O . Box 887, G nad Caym an, British W ot In d ia Phone; (809) M M 653/4 • T otac C P430S R ue (809) 949-7946 (809) 949^5267 23rd October, 1990. Mm David Humphries, Esq., Senior Manager - Operations, Guinness A Mahon Limited, 17 College Green, DUBLIN 2. Dear David, . Could you please arrange to let me have for collection on Thursday 25th October I$£500.00 in. cash. Please debit the Sterling cost of this to Ansbacher'Limited Account No.13154602. r v Q / .✓Could you also please arrange to let me have for collection on Thursday two lots of Travellers Cheques, each for DS$1 ,000 issued in the names of Mr. G. Miller and Mrs. MT/. Miller. _ Please debit the cost to Anpbacher Limited Account NoTl 3154009. Yours sincerely, o J.D. Travnor. ) AIMBACHtt jIMITSO . MMBACKn UNino c/o hr jr d T u n m 42 nTSHuxjut aaoua DUBLIN a B/8 •** copy B! «** CALL D/A JUtS . 35 OCT 90 Balano* brought Canard IttVUUH CH1QUKS 3,020.00 U1.ISJ.41 119,SIS.41 A/c Hs b/Q TVBS ■.13154007— Ert Call 13154008— *lan: Call 7 . ':* 131540091— Eset Call D/A Ba B/Z_ B» B/Z— Be B/Z-— 1 Uia4970— E*t CallD/A'— '**® B/Z A MambaqfthtHairyAmbachtrHi Please rqply to: 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 P .O . B ox 187, G n u id C aym an, B rftb li W o t In d ia P h o n e (809) 949-4653/4 T e ta c C P 4303 R ub (809) 949-7946 (809)949-3367 11th April, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness & Mahon Limited, 17 College Green, DUBLIN 2. i 7 T- - (J o l Q ju l S Z . Dear David, Could you please arrange' to purchase Stg.£45,000.00 worth of U.S. Dollars and credit the Dollars purchased to Ansbacher Limited Account No.13154009. The Stg.£45,000.00 should be debited to Ansbacher Limited Account No.13154602. Yours sincerely, J.D. Travnor. MUQPHYS s o l i c i t o r s M o i t . U >,;w/'.:'LV < ' ! * ' ! : : j . 91 Vpper G >A : r:rr\ Dun L.W'\ Co. D uc Ha . Tel: 230)::,; ra;: D.X. ca):i n v < ■■r:>cirj The Inspectors, Office o f the Inspectors to Ansbacher (Cayman) Ltd., 3rd Floor, Trident House, Blackrock, County Dublin. S M /E Y y o m ffi C /M 13/N S P M DATE: 06/12/01 Dear Sirs, W e refer to your letter o f the 16th o f November, 2001 to Geoffrey M ille r o f Blooms Lodge, Sandycove, County Dublin, whom we attended with at the hearing appertaining to M r. M ille r’s involvement with Ansbacher (Cayman) Ltd. A t the hearing, M r. M ille r advised that he had availed o f the amnesty pursuant to the W aiver of Certain Tax, Interest and Penalties Act, 1993 and at the hearing furnished evidence o f payment. For your reference, we enclose a copy o f the Certificate furnished to M r. M ille r pursuant to Section 2(4)(a) o f the W aiver o f Certain Tax, Interest and Penalties Act, 1993. In the circumstances, we are o f the view that the record should indicate that M r. M ille r availed o f the provisions o f the W aiver o f Certain Tax, Interest and Penalties Act, 1993. Yours faithfully, M U R P H Y S S< E n c l..../ S T A N M U R P H Y , B.A.. LL.B. Commr. tor Oaths, Notary Public VAU5RIID McCRANN, B.A., H.D.E. FIONA LEE, B.A. Hons. ALVA RlcGARRY, B.A. Hons. ~~ ' ■■ —» i.mn Commr. for Oaths VAT No. IE 48795531 A p p e n d ix X V (9 2 ) M r J e r o m e M o r r is 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Jerome Morris. a) Transcript of evidence of M r Stephen Morris dated 29 March 2000. b) Statement of M r Stephen Morris of 1 March 2000. c) Letter of 19 January 1999 - Ansbacher (Cayman) Limited to M r Stephen Morris. d) Indemnity of 6 August 1996 by Optima Securities in favour of Ansbacher (Cayman) Limited. e) Letter of 6 August 1996 - Ansbacher (Cayman) Limited to Optima Securities Limited. UNDER OATH ON WEDNESDAY, 29TH MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. STEPHEN MORRIS Represented by: MR. FRED JACKSON ORPEN FRANKS & COMPANY SOLICITORS LAND AGENTS 3 0 BURLINGTON ROAD DUBLIN 4 WITNESS MR. S. MORRIS I EXAMINATION MR. JUSTICE COSTELLO MS. MACKEY PAGE 55 3O 1 2 3 4 MR. JUSTICE COSTELLO: Good morning Mr. Morris. 5 MR. MORRIS: Morning. 6 MR. JUSTICE COSTELLO: My name is Declan Costello and on my right is 7 8 M s . Mackey. 9 MR. MORRIS: Yes . MR. JUSTICE COSTELLO: We are two of the 10 11 Inspectors. 12 MR. MORRIS: Okay. 13 MR. JUSTICE COSTELLO: That have been appointed by The High Court. 14 15 MR. MORRIS: Right. 16 MR. JUSTICE COSTELLO: I should explain to you, Mr. Morris, that this is 17 It is not a Tribunal. It is an 18 not a Court. 19 interview. 20 MR. MORRIS: Okay. 21 MR. JUSTICE COSTELLO: It is going to be an 22 interview under oath. 23 MR. MORRIS: Yes . 24 MR. JUSTICE COSTELLO: And I will ask Ms. Cummins to deliver the oath in a 25 26 moment. 27 MR. MORRIS: Okay. 28 However, I should explain 29 to you that if at any time 1 you want us to stop asking a question on which you 2 wish to get legal advice from your solicitor, we 3 will stop. 4 MR. MORRIS: Okay. 5 MR. JUSTICE COSTELLO: If your solicitor wishes 6 to intervene at any time 7 he can indicate this to us and we will stop. 8 MR. MORRIS: Okay. 9 MR. JUSTICE COSTELLO: And he can talk to you. 10 MR. MORRIS: Yes. 11 MR. JUSTICE COSTELLO: I will ask Ms. Cummins now 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 to deliver the oath to you. 1 2 AS FOLLOWS BY MR. JUSTICE COSTELLO 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Morris, it occurred to us that it might shorten 6 our interview if you could tell us briefly about the 7 settlement with the Revenue. 8 with any of the figures? 9 A. 10 2 Q. 11 A. 12 3 Q. 13 We are not concerned Right. At all? Yes. What we are concerned about is with regard to the dates to which the settlement related to? 14 A. 15 4 Q. 16 A. 17 5 Q. 18 A. 19 6 Q. 20 Yes. And also the source of the taxable income? Yes. Which was part of the settlement? Right. As I understand, if I could just very briefly summarise two points, we know that in 1976... 21 A. 22 7 Q. 23 A. 24 8 Q. 25 Yes. ... that money was transferred to Jersey? Yes. We know that in 1989 a trust was established in the Cayman Islands? 26 A. 27 9 Q. Yes. Could you tell me in relation to the settlement, did 28 the settlement relate to undeclared taxable income 29 dating back to 1976? 1 Possibly, yes, yes. 2 Some of it would be, yes, undeclared. 3 10 Q 4 5 When you say "possibly" have you actually reached a settlement with the Revenue? A 6 Well, we have made a substantial payment and we are in the process of finalising a settlement with them. 7 11 Q 8 A 9 10 I think it probably would have. Yes . It is not fixed up yet. It is in the process of being done. 12 Q What I wish to ascertain is whether or not there is 11 undeclared taxable income relating to the period 12 from 1976? 13 A 14 13 Q 15 A 16 14 Q 17 A Yes . And is that so? Is that part of the arrangement? Well...(INTERJECTION). Acknowledgment that you are making to the Revenue? We have given them everything back from 197 6 or, you 18 know, from whatever date it is. 19 everything right back, up to date. 20 15 Q No. We have given them However, is it from the time that you first had 21 an interest in an entity in the Channel Islands 22 in 1976? 23 A 24 16 Q 25 A 26 17 Q 27 Yes . Is that so? That is right, yes. Yes. You have given them all your records relating to that? 28 A 29 18 Q Absolutely, yes, yes. 1 2 MR. JUSTICE COSTELLO: Yes . 3 MR. JACKSON: Might I intervene? 4 MR. JUSTICE COSTELLO: Yes . 5 MR. JACKSON: What has happened to date 6 is the Revenue haven't got 7 all the files that you have. 8 MR. JUSTICE COSTELLO: Yes. 9 MR. JACKSON: As far as we know. 10 They may have got them 11 otherwise. 12 MR. JUSTICE COSTELLO: Yes. 13 MR. JACKSON: However, we have made, or 14 my client has made, a 15 payment on account of what he thinks is the tax that 16 would be payable from the time this started in 197 6 . 17 MR. JUSTICE COSTELLO: Yes. 18 MR. JACKSON: Calculations made have 19 gone in this week as to 20 how that was calculated. 21 MR. JUSTICE COSTELLO: Yes . 22 MR. JACKSON: However, the Revenue 23 haven't come back. 24 MR. JUSTICE COSTELLO: Yes . 25 MR. JACKSON: However, they have said 26 that they are going to 27 deal with them directly. 28 MR. JUSTICE COSTELLO: 29 Yes . 1 any further unless they 2 find something that they should take further, they 3 are not taking it further. 4 settlement. 5 MR. JUSTICE COSTELLO: Yes . 6 MR. JACKSON: That is...(INTERJECTION). 7 MR. JUSTICE COSTELLO: That is helpful. 8 MR. JACKSON: That is the position at They are going to make a the moment. 9 However, they 10 haven't, as far as I know, been given all the 11 volumes that you have been given directly. 12 MR. JUSTICE COSTELLO: Yes. 13 MR. JACKSON: Because...(INTERJECTION). 14 MR. JUSTICE COSTELLO: That is helpful because as I understand what you have 15 16 said is that your client has indicated to the 17 Revenue a liability. 18 MR. JACKSON: Absolutely. 19 MR. JUSTICE COSTELLO: From 1976? 20 21 22 A. Yes. MR. JACKSON: MR. JUSTICE COSTELLO: 25 MR. JACKSON: MR. JUSTICE COSTELLO: 28 29 In respect of undeclared Yes . Which he personally has now got to recover. 26 27 Yes . taxable income. 23 24 He has accepted a liability. MR. JACKSON: I am talking about him and his brothers. 1 2 3 Yes . MR. JUSTICE COSTELLO: 4 The admission, as far as Mr. Morris is concerned, 5 is that he is liable to pay tax. 6 MR. JACKSON: Yes. 7 MR. JUSTICE COSTELLO: In respect of income from 8 9 10 1976. MR. JACKSON: Yes . MR. JUSTICE COSTELLO: The amount of that income 11 is a matter for 12 negotiation. 13 MR. JACKSON: Yes . 14 MR. JUSTICE COSTELLO: And what is to be paid in 15 respect of it is a matter 16 for negotiation. 17 MR. JACKSON: 18 19 Yes, and those negotiations have started. MR. JUSTICE COSTELLO: 20 Yes. Does the acceptance of liability for income 21 tax also continue in relation to the trust that was 22 established in 1989? 23 MR. JACKSON: Yes . 24 MR. JUSTICE COSTELLO: Yes . 25 MR. JACKSON: It is a payment up to 26 date. 27 mean...(INTERJECTION) 28 MR. JUSTICE COSTELLO: 29 MR. JACKSON: I Up to date, yes. 1 2 3 4 MR. JACKSON: From these funds. 5 MR. JUSTICE COSTELLO: Yes. 6 MR. JACKSON: Having come into existence when they came back from 7 8 abroad. 9 MR. JUSTICE COSTELLO: Yes. MR. JACKSON: When the brothers came 10 11 back from abroad and put 12 these, left these, monies abroad. 13 MR. JUSTICE COSTELLO: Yes. You see what I am trying to consider now is 14 15 to what extent this bears on our task, on our 16 interview, here today. 17 MR. JACKSON: Yes. 18 MR. JUSTICE COSTELLO: Because, obviously, it is very important from our 19 20 point of view that we know now that it is accepted 21 by Mr. Morris that his involvement since 1976 meant 22 that he incurred a tax liability. 23 MR. JACKSON: 24 A. 25 19 Q. Yes. Yes. MR. JUSTICE COSTELLO: I think I should ask Mr. Morris to be a little 26 27 more specific about what the arrangements were? 28 Mr. 29 to the trust? Morris, we have got the documents in relation 1 2 20 Q. 3 A. 4 21 Q. 5 That was set up in 1989? Yes. However, we have no documents relating to any arrangement that was made in 1976? 6 A. 7 22 Q. 8 A. 9 23 Q. 10 A. 11 24 Q. 12 A. 13 25 Q. 14 A. Yes. Other than the letter that you left? Yes. That has been referred to? Yes. Do you remember did you establish a trust? No, not in 1976. No? No, no, not that I know of. MR. JACKSON: 15 Was there a trust? No. We don't know of any trust 16 in 1976 and we don't, as 17 far as I know any way when Mr. Morris spoke to me, 18 know of any reason why the trust came into 19 existence. 20 26 Q. MR. JUSTICE COSTELLO: 21 We will come to that later? 22 A. 23 27 Q. 24 A. 25 28 Q. 26 A. 27 2 9 Q. 28 A. 29 Yes. Yes. If there was no trust in 1976? No. You had funds in the Nova Scotia Bank? Yes. You decided to move them? That is right. 1 2 31 Q Would you just tell me whom in Guinness & Mahon did 3 you discuss this with and how did it come about that 4 you decided to do this? 5 A The first person I probably spoke to or the first -­ 6 of three people that I would have known in 7 Guinness & Mahon, was Ru Leonard, Pat O'Dwyer and 8 Martin Keane or in reverse order Ru Leonard, Martin 9 Keane and then eventually Pat O'Dwyer. 10 I think that would have been the way. 11 32 Q 12 A Yes. Tell me what was agreed? Well, that we would transfer whatever money we had 13 to Guinness & Mahon. 14 was Guinness & Mahon we were dealing with. 15 33 Q 16 As far as we were concerned it However, there was a bit more than that. It was going to go to the Channel Islands? 17 A 18 34 Q 19 A That is right. Tell me everything that was said to you about it? Well, they would have said, you know, they asked us 20 where we had some money already and that they would 21 probably -- the interest would have been more from 22 Guinness & Mahon, and that it would be in the 23 Channel Islands or Jersey or whatever way they would 24 have put it. 25 Channel Islands or whatever way they put it. 26 35 Q 27 A 28 36 Q 29 A I can't remember whether they said Was anything said about the tax situation? Not that I can recall. No, not that I can recall. You just deposited money then? 1 37 Q. 2 A. 3 38 Q. 4 Where you? Yes. Did they tell you that they had a company in the Channel Islands? 5 A. 6 39 Q. No, no. We have this letter that has been referred to 7 in which this company called Sierra Investments 8 Limited...(INTERJECTION)? 9 A. I remember that being mentioned at some stage, yes, 10 all right. 11 not but certainly I knew there was something 12 existing called Sierra Investments, yes. 13 40 Q. 14 A. 15 41 Q. 16 Well... (INTERJECTION)? But not from the very word so n o ...(INTERJECTION). Where did you think the money was going to be deposited? 17 A. 18 42 Q. In Guinness & Mahon in the Channel Islands. Yes. Were you told they had a bank there, a subsidiary bank? 19 20 A. 21 43 Q. Yes? 22 A. Yes. 23 44 Q. 24 I would think so, yes. As far as you were concerned the money then was going to earn interest? 25 A. 26 45 Q. 27 A. 28 46 Q. 29 I can't say that happened immediately or That is right. In there? That is right. As far as you know there was no trust there? 1 2 3 A. 4 5 I certainly remember the name Sierra Investments all right from the earlier days. 4 8 Q. 6 Yes. When you wanted to draw money from the funds that were lodged in Jersey? 7 A. 8 4 9 Q. 9 A. Yes. How did you go about it? Well, we probably would have rang -- Martin Keane 10 would have been one person that I recall from the 11 earlier days. 12 50 Q. 13 A. 14 51 Q. 15 A. 16 52 Q. 17 A. 18 53 Q. 19 A. 20 54 Q. 21 A. 22 55 Q. 23 A. Martin who? Martin Keane. Keane, yes? From Guinness & Mahon. Yes? Rue Leonard. Yes? Who was the accountant there. Yes? Or at some stage later Pat O'Dwyer. Yes. You would ring them? Ring them and maybe if you wanted some money, 24 a draft or some cash, you could get it from 25 Guinness & Mahon. 26 56 Q. 27 A. 28 29 How would you go about it, Mr. Morris? Just ring up and then maybe go in. collect i t . 57 Q. You would call in? Just call in and 1 2 58 Q. 3 A. Would they give you cash if you wanted cash? Well, possibly if you wanted cash you could get cash 4 or sometimes it might have even been a draft. I just 5 can't remember but it could have been either. 6 59 Q. 7 8 If it was a draft who was it payable by, do you remember? A. 9 It would have been -- I would imagine it would have been -- it definitely would have been a 10 Guinness & Mahon headed draft. 11 60 Q. 12 A. 13 61 Q. 14 Guinness & Mahon headed draft? Yes. Did you know whether it was the Guinness & Mahon in Dublin draft or not? 15 A. 16 62 Q. 17 A. 18 63 Q. 19 A. 20 64 Q. 21 I don't know that. You do not know? No, no, no. You cannot remember that? No, no. Over the years then you would have drawn money in the way you have indicated? 22 A. Small amounts. 23 65 Q. Small amounts? 24 A. 25 66 Q. What about lodging further sums to the fund? 26 A. There was nothing lodged after, I would say, Yes. 27 approximately 1978, nothing whatsoever. 28 after the late 1970s. 29 67 Q. Yes? Nothing 1 And there was money withdrawn, Okay, probably 2 sometime but there was nothing lodged after 1978. 3 68 Q 4 Yes. Did you get accounts Mr. Morris of the funds, of the money? 5 A 6 69 Q 7 A 8 70 Q 9 A No. Did you? No accounts. Did you know what was there? Well, sometimes or another -- maybe with a meeting 10 with Guinness & Mahon we might, I might, have 11 discussed it, or if I was in about borrowing money, 12 or something like that, it may have been discussed 13 that it was at a certain figure. 14 71 Q 15 A 16 72 Q 17 A 18 Yes? But I got no statement. However, they would tell you what was there? Well, they probably would have said to be roughly what was there. 19 73 Q 20 A 21 Would they tell you what interest it was earning? Yes, I think they would have told us what interest it was earning, yes. 22 74 Q 23 A 24 75 Q Yes. It was on deposit? It was on deposit, yes. Did you know that the funds could be used as 25 security for loans that you or your companies 26 received? 27 A 28 76 Q 29 Yes . From time to time this phrase has been used as "cash backed"? 1 2 77 Q. 3 A. 4 78 Q. 5 A. 6 79 Q. 7 Cash backed loan? Yes. Your deposits were used for this purpose? That is right. Yes. Did you know whether or not the money was, in fact, lodged in Dublin in a coded account? 8 A. 9 80 Q. 10 A. 11 81 Q. Never. I never knew that. You did not know that? No, never, no, no. Of course we have not any facts yet in relation to 12 your evidence, there is evidence that the Channel 13 Islands company in their own name? 14 A. 15 82 Q. 16 A. 17 83 Q. 18 A. 19 84 Q. 20 A. 22 85 Q. 23 A. 24 86 Q. 25 Yes. In coded accounts? Yes. And the persons who were entitled to the monies on Yes. That did not apply in your case? No, never, no. However, you were able to use it for back to back loans ? 26 A. 27 87 Q. 29 Lodged monies in Guinness & Mahon in Dublin? deposit in the Channel Islands could draw on it? 21 28 Yes. That is right. Did that situation then just carry on from 1976? Did it change at all? 1 think there was some change in the personnel in 2 Guinness & Mahon. 3 Yes. 4 MR. JACKSON: Can I interrupt? 5 MR. JUSTICE COSTELLO: Sorry? 6 MR. JACKSON: Can I interrupt? 7 MR. JUSTICE COSTELLO: Yes . 8 MR. JACKSON: One factor which you Had...(INTERJECTION)? haven't asked him about 9 10 but which is relevant I believe. 11 MR. JUSTICE COSTELLO: Yes. 12 MR. JACKSON: Is that towards the end of the time it was also used 13 14 back to back for bonds which Guinness & Mahon 15 provided to the company. 16 89 Q 17 A 18 19 90 Q 20 A 21 91 Q 22 MR. JUSTICE COSTELLO: Contracts, yes. MR. JACKSON: That is right. MR. JUSTICE COSTELLO: For contracts? Contracts, yes. Yes . MR. JACKSON: It is slightly different to the back to back loans 23 24 25 This is for your work? which the brothers got. 92 Q MR. JUSTICE COSTELLO: Yes. However, it was a security in which 26 Guinness & Mahon was able to grant you bonds? 27 28 A 29 93 Q That is right. 1 2 3 That is right. 94 Q 4 Yes. I was asking you about Mr. Traynor. Presumably you met Mr. Traynor? 5 A 6 95 Q 7 A 8 96 Q 9 I never met Mr. Traynor. You never met him? No. Your connections was originally with Mr. Leonard and then Mr. Keane? 10 A 11 97 Q 12 A 13 98 Q 14 A 15 99 Q 16 A 17 100 Q 18 That is right. However, you met Mr. Collery though? Yes, later much, much later. Yes? Much later. However, you never meet Mr. Traynor? Never met Mr. Traynor. Yes. One of the documents, which you have forwarded to us with your statement, is a handwritten note? 19 A 20 101 Q 21 A 22 102 Q 23 A 24 103 Q 25 A 26 104 Q 27 Yes . Of details of apparently withdrawals? Yes, that is right. And apparently lodgements? Yes . Is that in Mr. Collery's handwriting? That's Mr. Collery's handwriting, yes. I see. Have you got a copy of it there (Same Handed) 28 A 29 105 Q (Exhibit 1)? Yes . Mr. Morris, my copy is very hard to make out? 1 2 106 Q 3 A It is 1977. It would have been about a year after 4 the deposit. 5 showing it probably maybe a year later or something 6 like that. 7 107 Q 8 9 Yes. I suppose these people -- he is Could you just tell me how this document came into existence? A Around 1981 or thereabouts, 1980/81, we were going 10 to try and reconcile things with Mr. Collery and as 11 far as I remember we met him over Christmas or just 12 after Christmas. 13 everything to try and sort out who had got what and 14 what the situation was. 15 108 Q We were going to go through Yes . 16 MR. JACKSON: Can I interrupt? 17 MR. JUSTICE COSTELLO: Yes. 18 MR. JACKSON: I think you said 1981? 19 A 20 Sorry, 1991, sorry. MR. JACKSON: 21 A 22 109 Q 23 A 24 1991, sorry. I think you mean 1991. 1991, sorry. MR. JUSTICE COSTELLO: Yes? Around 1991, yes, and I think as far as I can remember he had this and gave us a copy of it. 25 110 Q 26 A Yes ? And we were going to try and go back over things and 27 see who had taken what money out and what things 28 were like at the time. 29 111 Q Yes? 1 And may be also to discuss the interests rates at 2 the time as well. 3 112 Q 4 A 5 113 Q 6 A 7 114 Q 8 A 9 115 Q Yes. When you say "who had taken what out"? Yes . Was this your brothers? That is right. Myself and my brothers, yes. Yes? Yes . This account prepared by Mr. Collery, was this in 10 relation to one account held in an Institution 11 somewhere? 12 A 13 116 Q 14 A 15 117 Q 16 17 A 18 118 Q 19 A 20 That is right. Out of which you and your brothers drew money? That is right. Yes. The document that I have is not headed in any way. Was the original headed in any way? No, never was headed. No, never was headed, no. Do you know what Institution the money was held in? Not at that time, no, no. I would have just assumed it was still in a Guinness & Mahon company. 21 119 Q 22 A 23 120 Q In a company? In Guinness & Mahon, yes. Yes. In relation to the fact that your brothers 24 withdrew sums from this joint account, could you 25 just give me the names of your brothers involved in 26 this ? 27 Well, at that stage there was five of u s . 28 Stephen. 29 Joseph, Thomas, Jerome and Martin. This is in the order of ages: I am Stephen, That was the 1 2 121 Q 3 A 4 122 Q 5 A 6 123 Q 7 A 8 124 Q 9 10 Yes . They each must have put it in? In the beginning, yes. In the beginning? Yes . Did you all then, at the beginning, put in an equal amount or was it an unequal amount? A It probably wouldn't have been fully equal. It 11 would have been -- some were maybe a little bit more 12 than others but that was going to be sorted out at 13 some stage or another as well. 14 125 Q 15 A 16 126 Q 17 A 18 127 Q 19 The five brothers then? That is right. Had this joint account? That is right. You had, each of you, had contributed approximately in equal amounts? 20 A 21 128 Q 22 A 23 129 Q 24 25 Yes. That is right. Into your joint account? That is right. Did you then regard yourselves then as each owning one fifth of it, approximately? A Yes, until it was finally sorted out it. 26 wouldn't have been too far off been equal. 27 might have been...(INTERJECTION). 28 130 Q 29 A Yes? It There 1 131 Q 2 A 3 132 Q 4 A 5 133 Q 6 Yes . For the moment? Yes, roughly one fifth, yes. You each would have been entitled to a fifth of the interest if it made interest? 7 A 8 134 Q 9 A 10 135 Q 11 That is right. And a fifth of the capital if you withdrew it all? That is right, that is right. When you were talking to Mr. Collery in 1971. MS. MACKEY: 12 A 13 136 Q 14 A 15 137 Q 1991. In 1991. MR. JUSTICE COSTELLO: 1991? Yes . Did he make any reference then to the "Ansbacher" 16 situation, to the money being in the Cayman Islands 17 or anything like that? 18 A 19 138 Q 20 A 22 139 Q 23 Yes. It is page 29 (Exhibit 2)? Thank you. This is a letter, it is headed your firm, and I think it may well be your letter? 24 A 25 140 Q 26 A 27 141 Q 29 I would like you to look at a letter. (Same Handed) 21 28 No, no. It is my signature, yes. Yes. It is to The Irish Intercontinental Bank? Yes . It is : "Dear Sirs, I herby request drawdown of IR£50 9,075.34..."? 1 2 142 Q "...under S.M. Morris Limited's loan facility with IIB..."? 3 4 5 A 6 143 Q Yes . "...I also request IIB to use this amount to purchase GBP 458,167.81..."? 7 8 9 A 10 144 Q Yes . "...On our behalf and pay that amount to the account of "Ansbacher" Limited, Grand Cayman with IIB, account no..." 11 12 then giving the account number? 13 14 A 145 Q 15 Yes . "...to refund monies used to finance the purchase of asphalt plant from ACP Group of Companies"? 16 17 18 A 19 146 Q 20 21 Yes . Is it not clear Mr. Morris that you knew all about "Ansbacher" then? A Well, to be honest with you that is the first time I 22 have seen this, and this would have been done -- I 23 was -- 24 from England. 25 147 Q 26 A 27 28 29 I had made an arrangement to buy a plant Yes ? And it was going to be funded by IIB Bank as a company loan at the time. 148 Q What I am referring you to is that you are asking The Irish Intercontinental Bank, 1 "...pay that amount to the account of "Ansbacher" Limited," 2 3 and giving the account money? 4 Yeah, somebody would have given us that to write in. 5 Somebody would have given us that at the time. 6 could explain a bit more? 7 149 Q 8 A 9 If I Yes? We had purchased the plant in England and we weren't able to pay for it and I rang Padraig Collery to 10 tell him what our difficulty was, and he said that 11 they possibly could, subject to us getting the loan 12 from IIB Bank, that they could do this and this was 13 -- he must have given this to our office to have it 14 signed at the time. 15 150 Q 16 A Yes? But I certainly never recall seeing the name 17 "Ansbacher". 18 anything to me any way. 19 151 Q 20 No. If I had it wouldn't have meant I am only drawing your attention to the fact that this letter signed by you in 1991? 21 A 22 152 Q 23 A 24 153 Q 25 A Yes . Specifically refers to "Ansbacher"? Okay. And to the account money? Okay, Okay. I accept that now, yes, but I certainly...(INTERJECTION). 26 27 154 Q 28 A 29 155 Q Then...(INTERJECTION)? It would have meant nothing to me at the time. 1 2 156 Q 3 A 4 157 Q I think so, yes. Because this is clear indication that you knew that 5 "Ansbacher" Limited had an account in IIB, that you 6 knew the number of the account, and that you were 7 requesting that money be paid into it? 8 A 9 158 Q 10 A 11 Okay. Yes ? I would say that letter was dictated by someone from...(INTERJECTION). 12 159 Q 13 A Yes ? I would think may be Padraig Collery would have 14 dictated that letter to the office and I would have 15 been asked to sign it. 16 signature but it wouldn't have meant anything to me 17 at the time. 18 160 Q Yes. It definitely is my You were involved in Irish Intercontinental Bank? 19 20 A 21 161 Q 22 A 23 162 Q 24 That is right. You were obtaining loans from them? That is right. You were getting the assistance then, were you not, of Mr. Collery in relation to these loans? 25 A 26 163 Q 27 That is right, that is right. Yes. Mr. Collery was then to your knowledge associated with Guinness & Mahon? 28 A 29 164 Q That is right. That is correct? 1 2 165 Q 3 Did you know that Guinness & Mahon then had dealings with Irish Intercontinental Bank? 4 A 5 16 6 Q 6 A I didn't. I didn't really know. Yes ? I didn't know what -- I didn't know. I think 7 we were introduced to Intercontinental Bank, 8 The Irish Intercontinental Bank, probably through 9 Padraig Collery, or told by him to see Irish 10 Intercontinental Bank. 11 167 Q 12 A 13 168 Q Yes ? I can't remember. Yes. Mr. Morris, you have described to us how the 14 funds that were lodged in the Channel Islands were 15 to be regarded as you and your brother's funds? 16 A 17 169 Q That is right. When the situation continued on with Mr. Collery, 18 and into the 1990s, was the situation the same, you 19 regarded what funds that were there as belonging to 20 your brothers and yourself? 21 A 22 170 Q 23 A 24 171 Q 25 That is right. You know now that a trust was established in 1989? Yes . And whatever happened in relation to the trust the arrangement still continued? 26 A 27 172 Q 28 A 29 173 Q That is right. That your brothers and yourself? That is right. Drew as you required in equal, or from nearly equal, 28 1 2 3 That is right. 174 Q Looking at the situation now, the situation which 4 you have learnt Mr. Morris, does it appear as if the 5 funds of the trust that was established in 1989 came 6 from your funds in Jersey Island? 7 A 8 175 Q 9 A 10 176 Q 11 A 12 177 Q 13 That is right, yes. Is that your understanding? That is right, yes. Is that what you have been told? Yes . I take it that you have looked at the documents? The documents show that a trust was established? 14 A 15 178 Q 16 Yes . Mr. Furze was named as the Settlor but he was only a nominal person? 17 A 18 179 Q Yes . Somebody then instructed the Jersey Institution or 19 it may have been Dublin, we do not know but 20 whereever your funds then were, somebody instructed 21 that they be moved into the Investment company or to 22 the trustees, the "Ansbacher" trustees? 23 A 24 180 Q 25 A 26 181 Q 27 A Did you do that? No. Do you know who did it? Whoever was looking after the funds at the time, whoever...(INTERJECTION). 28 29 Yes . 182 Q 1 2 183 Q 3 4 Presumably you have made enquiries and you are satisfied that it was done, was it not? A Well, much later. I found out when I went to try 5 and get some funds much later I found out a bit more 6 about the trust and...(INTERJECTION). 7 184 Q 8 A 9 When was that? I had to go to the Cayman to try and get things sorted out to get money back to pay the Revenue. 10 185 Q 11 A 12 Yes ? And then I found out more about what -- we got some more documents then to do with it. 13 186 Q 14 A 15 187 Q 16 A Did you not raise the matter with Mr. Collery? I did, yes. Tell me what he told you? He told me to contact a person. He gave me a 17 person's name in the Cayman to phone, a person's 18 name in the Cayman. 19 188 Q 20 A 21 189 Q 22 A 23 190 Q Yes? And get whatever I could from him. However, did he not tell you what had happened? No, no. However, surely you must have said, "How did my 24 money get over into this Bank in the Cayman 25 Islands"? 26 A Well, it wasn't -- if it was -- we just took it to 27 be everything was just Okay and whereever it was it 28 was under their control and there was no problem 29 with i t . 1 191 Q 2 A 3 I mean if I wanted to get in touch with Mr. Collery there was no problem in getting in touch with him. 4 192 Q 5 A 6 193 Q 7 A 8 194 Q You left it to him? 9 A Yes, that is right. 10 195 Q 11 A 12 196 Q 13 A 14 197 Q You were not concerned? I wasn't concerned. Where the money was? Not in the least. You trusted him? That is right. And that it would be in a safe Institution? Yes . Yes. All right. It appears, from what you have 15 been saying to me Mr. Morris, that in respect of 16 your share? 17 A 18 198 Q Yes . Of the funds that were originally in Jersey and then later in Cayman? 19 20 A 21 199 Q Yes . That your share of these funds produced, obviously 22 produced, interest, income, and that you accept that 23 you are taxable on it? 24 A 25 200 Q Yes . I think I must ask you this: From what you have 26 said to me you are only liable, on what you said, 27 for a portion of the income, for the tax on the 28 income? 29 Myself? 1 201 Q 2 A 3 202 Q 4 A 5 203 Q 6 A 7 204 Q 8 A 9 205 Q 10 Yes . It must appear that your brothers are liable? That is right. Are they taking steps to settle it? Yes. Well, we all have done the same. You have all done the same? We have all done -- it is a joint...(INTERJECTION). Yes. Sorry? MR. JACKSON: 11 Its just this: The person dealing with the tax on 12 behalf of this fund is dealing on behalf of all the 13 brothers, including Martin deceased. 14 MR. JUSTICE COSTELLO: Yes. 15 MR. JACKSON: On behalf of the 16 17 executrix. A Yes . 18 MR. JACKSON: Or the administrator. 19 MR. JUSTICE COSTELLO: Who was that Mr. Jackson? 20 Is it an accountant 21 dealing with it? 22 MR. JACKSON: Noel Murphy. 23 MR. JUSTICE COSTELLO: Mr. Noel Murphy. 24 A Yes . 25 MR. JUSTICE COSTELLO: Yes . 26 MR. JACKSON: He is a 27 tax...(INTERJECTION). 28 No. 29 task is to report to The It is just that our 1 2 3 Yes . 207 Q It does appear, from what you have said, that it not 4 only was Mr. Murphy, Mr. Stephen Murphy, was 5 taxable...(INTERJECTION) 6 MR. JACKSON: Morris. 7 MR. JUSTICE COSTELLO: Sorry, Mr. Stephen Murphy 8 was taxable but that...(INTERJECTION). 9 10 MR. JACKSON: 11 The other brothers are too. 12 MR. JUSTICE COSTELLO: The other brothers are too. 13 MR. JACKSON: 14 Yes, and they do accept that. 15 16 MR. JUSTICE COSTELLO: They accept that. 17 MR. JACKSON: It is one whole unit. 18 MR. JUSTICE COSTELLO: Yes . 19 MR. JACKSON: As far as Mr. Murphy. 20 MR. JUSTICE COSTELLO: Yes . 21 MR. JACKSON: Who is making the claim 22 23 for the assessment. 208 Q MR. JUSTICE COSTELLO: Yes. Perhaps, we will have a break now for a cup 24 of coffee Mr. Morris? 25 26 A 27 209 Q 28 A 29 210 Q Please, yes. For ten minutes or so? Please. 1 2 Okay. 3 211 Q 4 A 5 212 Q 6 However, we will have a cup of coffee too? Okay. We will come back in ten minutes or so. MR. JACKSON: 7 Can I make one...(INTERJECTION)? 8 MR. JUSTICE COSTELLO: Yes. 9 MR JACKSON: This letter came in at one 10 stage. Now, it is the 11 only copy I have but it does, in fact, say in 1998, 12 when Mr. Morris must have made enquiries, that they 13 know nothing about the account. 14 MR. JUSTICE COSTELLO: About? 15 MR. JACKSON: About the funds. 16 have seen that but I don't 17 recall having seen that letter. 18 MS. MACKEY: 19 20 23 May we make a copy of this ? A 21 22 Yes, yes. MR. JACKSON: A Of course, yes. Yes . MR. JACKSON: 24 Mr. Morris, found it at home last night, which is 25 an interesting letter (Exhibit 3). 26 MS. MACKEY: 27 28 29 I may We will ask Ms. Cummins to make a copy of it before you g o . 1 Yes. 2 interesting that they can 3 4 I find it extremely make such a statement. A. Thank you. 5 SHORT ADJOURNMENT 6 MR. JACKSON: Mr. Costello? 7 MR. JUSTICE COSTELLO: Yes? 8 MR. JACKSON: May I make two comments? 9 MR. JUSTICE COSTELLO: Yes . MR. JACKSON: About things that 10 11 happened before? 12 MR. JUSTICE COSTELLO: Yes . 13 MR. JACKSON: One is this particular 14 letter (INDICATING) 15 (Exhibit 2). 16 MR. JUSTICE COSTELLO: Yes . 17 MR. JACKSON: Here (INDICATING). 18 MR. JUSTICE COSTELLO: Yes . 19 MR. JACKSON: I am speculating but it is 20 not on S.M. Morris Limited 21 letterhead. 22 MR. JUSTICE COSTELLO: Yes . 23 MR. JACKSON: Which would seem to 24 indicate and 25 this...(INTERJECTION). 26 MR. JUSTICE COSTELLO: 27 28 29 I am sorry, I cannot get submissions now. MR. JACKSON: Okay. 1 2 3 MR. JUSTICE COSTELLO: Yes . 4 MR. JACKSON: However, I mean I would 5 say the evidence is that this is not on S.M. Morris 6 Limited letterhead. 7 MR. JUSTICE COSTELLO: 8 Yes. We have got a copy of this letter. 9 10 MR. JACKSON: Yes . MR. JUSTICE COSTELLO: And where the letterhead 11 is I do not -- the 12 original, I do not know. 13 MR. JACKSON: However, it seems to be a copy of the original. 14 15 MR. JUSTICE COSTELLO: Yes . 16 MR. JACKSON: Not a carbon. 17 MS. MACKEY: We understand, yes. 18 MR. JUSTICE COSTELLO: If there is any comments you want to make, please 19 20 make them later. 21 MR. JACKSON: Okay. MR. JUSTICE COSTELLO: However, at the moment we 22 213 Q will just move on. 23 24 letter that you gave us 25 secretary Sandra Kells 26 A 27 214 Q 28 A 29 215 Q Yes . On the 24th April? Yes . She refers to your lette 36 igned by the company (Exhibit 3)? This 1 2 3 Yes . 216 Q 4 Then she says, "I am enclosing herewith the following documentation which contains copy clients files identified by the date for the relevant persons." 5 6 7 Are those your files? 8 A 9 217 Q Sorry, is it this letter here? "I am enclosing herewith following documentation"? 10 11 12 A 13 218 Q 14 A Yes . Did she send you on documents? Well, whatever, it is in all of that to do with our banks loans and...(INTERJECTION). 15 16 219 Q 17 A 18 220 Q 19 A 20 221 Q 21 A 22 222 Q 23 A 24 223 Q 25 A 26 224 Q Those documents? You have. That you have? Yes . We got all of that? Yes . I see? You have got all of them, yes. Very well? Yes . Very well. Mr. Morris, that is all the questions I 27 want to ask you now. 28 to ask you a few questions? 29 A However, Ms. Mackey would like 1 2 3 4 MR. STEPHEN MORRIS WAS EXAMINED, AS FOLLOWS, BY 5 M S . MACKEY 6 7 225 Q. MS. MACKEY: 8 Mr. Morris? 9 A. 10 226 Q. 11 A. 12 227 Q. 14 A. 15 228 Q. 16 A. 17 229 Q. 18 We are nearly finished really? Okay. It is just a couple of things that I would like to Okay. I am just not terribly clear on it? Yes. One of the things I wanted to just clarify a bit if you can? 19 A. 20 230 Q. 21 A. 22 231 Q. 23 A. 24 232 Q. 25 Okay. And I know this is a long time ago and so on? Okay. Is this question of Sierra Investments? Yes. I would like to you show you a document. 60 Ms. Cummins 26 A. 27 233 Q. 29 Okay. clarify for my own satisfaction? 13 28 I have very few questions (Same Handed) (Exhibit 4)? Thank you. This, as you see, is a letter written by It is page 1 2 A 3 235 Q 4 A 5 236 Q 6 Yes . It is dated 30th July 1976? Yes . It refers to, "Certificates of deposits, numbers 086583 to 086588"? 7 8 A 9 237 Q 10 Yes . That is five Certificates, "...inclusive which we enclose herewith, and give formal 7 days' notice of our intention to withdraw these amounts"? 11 12 13 A 14 238 Q Yes . "...On Tuesday, 10th August, please transfer thre total amount together with accrued interest to Guinness Mahon & C o ., Ltd.,... 15 16 17 18 London? 19 A 20 239 Q Yes . "... for credit to our account..." 21 22 that is Sierra's account, 23 "...with Guinness + Mahon Ltd., College Green, Dublin t." 17, 24 25 A 26 240 Q 27 Yes . Is that the occasion of the transfer of your money to Guinness & Mahon? 28 A 29 241 Q I would think so. Yes? 1 2 242 Q. Does it not appear from this that your money in The 3 Bank Of Nova Scotia was held at that time by this 4 company Sierra Investments? 5 A. 6 243 Q. No. May be I could just pass you another document, which 7 may be makes it a bit clearer. 8 Mary, page 61. 9 Nova Scotia to you (Same Handed) 10 A. 11 244 Q. 12 A. 13 245 Q. 14 A. 15 246 Q. 16 It is the next page This is a letter from The Bank Of (Exhibit 5)? Yes. Referring to that earlier one? Yes. It is the 4th August 1976? Yes. It says: "Re: Sierra Investments Limited. I am enclosing a photostat copy of correspondence received today from the above Company"? 17 18 19 A. 20 247 Q. 21 A. 22 248 Q. Yes. Clearly the previous letter? Okay. "...wherein we have received a seven days notice of their intention to call their deposits with us"? 23 24 25 A. Yes. 26 249 Q. Then: 27 28 29 "In view of the long association you have maintained with our Office..." 1 2 Yes . 3 250 Q 4 A However, it refers to Sierra's deposits? Yeah. Well, I would have thought Sierra was --have 5 been -- whatever correspondence had been with 6 Guinness & Mahon and Bank Of Nova Scotia previous to 7 that. 8 Bank Of Nova Scotia. 9 had gone on 10 251 Q 11 A Sierra was never anything to do with The Whatever correspondence that in the weeks prior to that. Yes ? With Guinness & Mahon and The Bank Of Nova Scotia, 12 that is definitely where Sierra started. 13 no connection whatsoever previously. 14 252 Q 15 A 16 253 Q 17 A Can you explain then what is meant by these? I can't. No? I can't. I just can't off hand. Maybe Fred and I 18 will just have a quick look at this. 19 see . 20 MR. JACKSON: 21 22 There was Will you just I mean I can not understand this. 254 Q Have you seen these letters? 23 MR. JACKSON: I have seen both letters. 24 MS. MACKEY: Sorry, I should address my 25 remarks to Mr. Morris 26 really? 27 MR. JACKSON: 28 29 A Yes . Yes 1 2 3 256 Q 4 A 5 257 Q 6 A 7 258 Q 8 9 All right? We have gone over them, yes, yes. Prior to today? Yes, yes. You can furnish no information? You have no explanation for that? A No, but I can tell you that Sierra Investments was 10 sort of Guinness & Mahon. 11 do with...(INTERJECTION). 12 259 Q 13 A 14 260 Q 15 It never was anything to Yes ? With...(INTERJECTION). Can I just ask you: Was you joint account with your brothers ? 16 A 17 261 Q 18 A 19 262 Q 20 A 21 263 Q 22 A 23 264 Q Yes . In the name of you and your brothers? Yes . Or some other name? No, it was in the name of -- in our own names. Yes. In your own names? Yes . Do you have documents showing, you know, the name in 24 your joint accounts with Guinness & Mahon after this 25 date? 26 A 27 265 Q 28 A 29 No. You do not? 1 2 to just Guinness & Mahon 3 or related to Nova Scotia before that? 4 MS. MACKEY: 5 My question relates to Sierra Investment because 6 what I am wondering is whether Mr. Morris and his 7 brother's monies were held by a company Sierra 8 Investments both prior to the transfer with Guinness 9 & Mahon and subsequently? 10 A 11 268 Q 12 A 13 269 Q 14 15 Definitely not prior to Guinness & Mahon, no. Right. From the move to Guinness & Mahon onwards? Yes . Were your monies then held in the name of Sierra Investments? A 16 That is what I would have thought. That is what I would have thought, yes. 17 270 Q 18 A 19 271 Q 20 You thought that? Yes . The transfer according to this letter, the first one that I showed you? 21 A 22 272 Q 23 A 24 273 Q Yes . The letter dated 30th July? Yes . The money is transferred to "our account", that 25 is Sierra's account, with Guinness & Mahon in 26 College Green, Dublin? 27 A 28 274 Q 29 Yes . Can you tell us, you may not know but if you do, can you tell us what happened the money from then on? 1 Well, as far as I was concerned it was in Jersey or 2 the Channel Islands. 3 275 Q 4 A 5 276 Q 6 A 7 277 Q 8 A 9 278 Q 10 A In Jersey, yes? In Jersey or whatever it is, yes. During all that time? Yes . Yes? That is as far as I was concerned. Yes ? I see here it mentions with the account with Dublin 11 but as far as we were concerned it never 12 was...(INTERJECTION). 13 279 Q 14 A 15 280 Q 16 It was in Jersey, yes. Yes. I think you said you did not get statements during that time? 17 A 18 281 Q That is right. You did not get any written statements from Jersey at all in Dublin? 19 20 A 21 282 Q 22 23 It was in Jersey? None whatsoever. But, from time to time, Mr. Leonard or Mr. Keane would give you an oral...(INTERJECTION)? A Yes, if I was in talking to him about maybe some 24 borrowings or something, we were trying to do 25 business with him other than that, and I might have 26 asked him and he might have advised me but I 27 certainly had no statements, no. 28 Did you ever get anything in the name of Sierra 29 Investments ? 1 2 When you were answering Mr. Justice Costello's 3 questions earlier, you mentioned that everything 4 continued on, as it were, up to the end of the 1980s 5 and the early 1990s when there was a change in 6 personnel? 7 A 8 285 Q 9 10 Yes . Would you just tell me what happened at that time, as far you were concerned? A 11 Well, I would have gone into Guinness & Mahon maybe to try and arrange some company loans. 12 286 Q 13 A 14 Yes ? And talk to them and then I met Martin Lanigan-0'Keefe, he was the new manager. 15 287 Q 16 A 17 This would be now when? I would have thought probably, maybe, well about two years before, about 1988 or thereabouts. 18 288 Q 19 A 20 289 Q 21 A Right? Or thereabouts. Yes? And I was told them there was a change, they were 22 not doing any business like they were before, and 23 with if I wanted to talk to somebody I had 24 previously we were to 25 290 Q 26 A 27 28 29 talk to Padraig Collery. Who told you this? I think that was Martin Lanigan-0'Keefe who was the manager then of Guinness & Mahon in Dame Street. 291 Q Yes, that is right, and when he said to you that they weren't doing business like they were before, 1 2 He meant that they wouldn't be doing any 3 back-to-back loans or whatever, or whatever he would 4 have meant by it. 5 292 Q 6 A No longer doing back-to-back loans? I think he just wasn't doing business and that was 7 it. 8 do whatever he was to do and he didn't seemed to be 9 interested in doing business. 10 293 Q 11 A 12 I think that was it. I think he was there to But when you say "in doing business"? Sorry, we did do other business with him in around 1990 when we were very badly strapped for cash. 13 294 Q 14 A Yes? And we did a borrowing on the building we occupied 15 in Stillogan Industrial Park. He arranged some money 16 for us at that stage. 17 295 Q Just to get clear what it was he was conveying to 18 you at that time, or what you understood he was 19 conveying to you, he said to you, you were to get in 20 touch with Mr. Collery? 21 A 22 296 Q 23 A 24 297 Q 25 A 26 298 Q 27 Yes . In regard to that? To any of our, to our monies. To your overseas monies? Yes . So when he said they weren't doing any more business, he meant, did he, with overseas monies? 28 A 29 299 Q I would have thought so, yes. 1 2 300 Q 3 A 4 301 Q 5 6 But that you were to get in touch with Mr. Collery? Regarding our own funds. And was Mr. Collery still a member of staff there at that time? A I am not sure of that, I just don't know when he 7 left. 8 it was probably somewhere in around those years or 9 maybe prior to 1990 any way. 10 302 Q 11 I couldn't put a date on it when he left, but Did you immediately contact Mr. Collery at that time? 12 A 13 303 Q 14 A I think we did, yes. Where did you contact him? Well, we had a home money I notice there, On one of 15 the things we had a phone money and we might have 16 rung him there, or subsequently we might have got a 17 money where he was working, at some stage we got a 18 money where he was working. 19 304 Q 20 A Did you ever talk to him in Guinness and Mahon? Yes, when he was Guinness and Mahon some time, I 21 can't remember what years, but he wasn't one of my 22 contacts there in the earlier parts. 23 305 Q 24 25 So you would have talked to him in Guinness and Mahon in what context? A Maybe at some stage we might have got some money 26 back to him as well, I just can't remember, or maybe 27 somebody else did, I just can't remember. 28 29 306 Q Right but, in any event, Mr. Lanigan-0'Keefe referred you to him on this occasion? 1 2 307 Q Did you understand that to mean that, this was the 3 end of the 1980s, that Guinness and Mahon as such 4 was longer dealing with your business? 5 A Not really. As far as we were concerned, our money 6 was still with Guinness and Mahon in Jersey. 7 is as far as I was concerned. 8 308 Q 9 10 That But you understood that Guinness and Mahon in Dublin was no longer dealing with it; is that it? A Well, yes, that is it more or less, but I did not 11 think it was isolated from the main Guinness and 12 Mahon. 13 not dealing but it was being dealt with from Jersey. 14 309 Q I just took it to be that maybe Dublin was Right, but did it not worry you that the managing 15 director of the bank you were dealing with would say 16 to you, "We are no longer dealing with your money" 17 and refer you to somebody who may not have been 18 working there at the time? 19 A No it didn't at the time. We just took it that 20 everyting was alright and which probably proved in 21 the late 90s when we had to get money urgently, that 22 we were able to do it and it was backed by loans 23 from somewhere so we were happy enough. 24 310 Q MR. JACKSON: I think you said the late 25 90s. 26 A 27 311 Q 28 A 29 312 Q Sorry, the early 90s. MS. MACKEY: It was the early 90s? Yes . On the first occasion that you contacted Mr. Collery 48 1 after this, did he give you any explanation as to 2 why he was now taking over the operation of your 3 accounts rather than the people you had been dealing 4 with prior to this? 5 A. 6 313 Q. 7 A. No. Did you ask him? I don't think so, I don't remember asking him, but I 8 do not think we were ever concerned, I just don't 9 think we were ever concerned that there was going to 10 11 be problem anywhere along the line. 314 Q. Even though at the stage you were visiting somebody, 12 either contacting them in their own home, or 13 contacting them in a place that had no connection 14 with Guinness and Mahon? 15 A. 16 315 Q. 17 A. 18 316 Q. 19 A. That is right. That did not worry you? No. You didn't find that strange? No, I didn't no. Obviously when we were looking for 20 funds, or were looking to get something back, it was 21 readily available, that made us probably all the 22 more assured that, you know, there was no problem 23 along the line. 24 317 Q. 25 was that transacted? 26 A. 27 318 Q. 28 A. 29 When you needed to get money from Mr. Collery, how Just with a phone call to Padraig Collery. And then what would happen then? Well, I know at one stage when I wanted to get a 1 2 319 Q. 3 A. 4 320 Q. 5 A. 6 321 Q. 7 A. 8 From Merrion Square? From Merrion Square, yes. Where in Merrion Square? From the CRH offices. Fitzwilliam Square? Sorry, Fitzwilliam Square. Sorry, I am mistaken there, yes. 9 322 Q. 10 A. 11 323 Q. 12 A. 13 Did you personally collect that? Yes. And who do you meet there? Some lady, I would have thought some lady maybe in her 40s or 50s, I just can't remember. 14 324 Q. 15 A. Would it have been Ms. Joan Williams? It could possibly have been. I haven't, I just 16 walked in and I was asked who I was and I just 17 collected the draft. 18 325 Q. 19 A. 20 That was when roughly? In 1991, I think, from memory now. I just have to look at that, around 1991. 21 326 Q. 22 A. 23 327 Q. Not Mr. Traynor? 24 A. Not Mr. Traynor. 25 328 Q. 26 A. 27 32 9 Q. And Mr. Collery arranged that for you? Yes. You said I think that you never met Mr. Traynor? That is right. But in one of the documents you provided for -- it 28 was the document, Ms. Cummins, page 62 -- 29 document that they gave you when you went out to the 1 2 3 Yes ? 330 Q That you told us about showing distributions, as 4 they called them, from your funds from Optima 5 Securities ? 6 A 7 331 Q 8 A 10 332 Q 11 Yes . And there is the TM which I think you said relates to your brother? A 13 14 The 4th item down there is cash paid to J.D. Traynor? 9 12 Yes . That was my brother who must have received that from Mr. Traynor's office. 333 Q Right. Is it possible that your brothers may have met Mr. Traynor? 15 16 A 17 334 Q 18 No, absolutely not, no. Had you heard of him in connection with all of this during this time? 19 A 20 335 Q 21 A I heard of his name at some stage. During this time while you were dealing Mr. Collery? Not necessarily. I might have heard his name 22 previously through Guinness and Mahon but I never, 23 it did not mean much to me at this time. 24 25 336 Q Right. Now, I do not think I have any more questions, Mr. Morris, thank you. 26 27 END OF EXAMINATION OF MR. STEPHEN MORRIS BY MS. 28 MACKEY 29 1 2 3 4 337 Q MR. JUSTICE COSTELLO: 5 Just, one or two questions Mr. Morris? 6 A 7 338 Q 8 Yes . Your first contact with Guinness and Mahon was with Mr. Rue Leonard, 9 A 10 339 Q I think? Yes . And it was his suggestion then that he could give 11 you better interest rates, perhaps at any rate he 12 suggested you should come to Guinness & Mahon? 13 A 14 340 Q 15 Yes . And he told you then about this Jersey company, Sierra Investment; is that right? 16 A 17 341 Q Yes, at some stage. Now, the letter that Ms. Mackey has shown you shows 18 that Sierra Investments had an account in Guinness 19 and Mahon in Dublin (Exhibit 4)? 20 A 21 342 Q Yes . Is it possible, you may not have known, that your 22 money was on deposit in Dublin in Sierra 23 Investments' name? 24 A 25 343 Q 26 A 27 344 Q 28 A 29 345 Q No, that is not possible. You do not think so? No never. You think it was deposited in a bank in? In Jersey, yes. 1 A. Well, that is what I was always told, that is what I 2 was told from Guinness and Mahon, that the money was 3 in Jersey. 4 346 Q. 5 A. 6 347 Q. 7 A. 8 34 8 Q. 9 And the name Sierra Investments was mentioned. I see. Very well then, thank you, Mr. Morris? Okay. What we require from you is to drop in to sign the transcript of this interview. 10 11 Was in Jersey, I see. It will be typed up and then if you could sign it. A. Okay. 12 13 END OF EXAMINATION OF MR. STEPHEN MORRIS BY MR. 14 JUSTICE COSTELLO 15 16 THE EXAMINATION OF MR. STEPHEN MORRIS WAS THEN 17 CONCLUDED 18 19 20 21 22 23 24 25 26 27 28 29 1 2 something. You see, it 3 might be possible, and it would avoid asking Mr. 4 Morris' brothers to come in, if we got a letter from 5 them acknowledging that the evidence that Mr. Morris 6 has given today is correct so that we would not 7 require them to come in here to give on oath of what 8 he has already told us. 9 MR. JACKSON: 10 Well certainly that would be appreciated because I 11 do know all the brothers, and have done, and they 12 could certainly, and the administrator or the 13 personal rep of Martin in that regard to. 14 MR. JUSTICE COSTELLO: 15 That would seem to me to be a practical way of 16 dealing with the situation. 17 come in if we get a letter from you written on their 18 behalf dealing with the matters. 19 MR. JACKSON: 20 The brothers needn't I will show them what has been said, obviously, a 21 copy of the transcript after Stephen Morris has 22 signed it. 23 24 There is one other point which I think ought to be 25 corrected and I think one of your questions said, 26 "This tax relates to the tax in relation to these 27 deposits from 1976". 28 in relation to their tax from the time the brothers 29 returned to Ireland from working abroad. In fact the tax calculation is 1 2 MR. JACKSON: Before 197 6 . Some of them returned in 1969, some of 3 4 them were returned in 1974 but it is to cover all 5 those foreign monies that were earned, not just from 6 1976. 7 MR. JUSTICE COSTELLO: 8 A. 10 A. Thank you. Yes. Thank you. Yes MR. JUSTICE COSTELLO: 9 Yes. Thank you. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN CONCLUDED. no ("8707 6,557 Daft/m bog". u?u STATEMENT OF MR STEPHEN MORRIS TO THE INSPECTORS APPOINTED BY ORDER OF THE HIGH COURT ENQUIRING INTO THE AFFAIRS OF ANSBACHER (CAYMAN) LIMITED The body corporate, S M Morris Limited and itssubsidiarieswithwhich Iand my family are connected, have atno time had any dealings with Ansbacher (Cayman) Limited (hereinafter called "theBank"). Our Company, my brothersand Ididbank attimes withMessrs Guinness & Mahon Limited and do bank withIrishIntercontinentalBank. ("IIB") Ion behalfofmyselfand my brothersTomas, Joseph,Martin and Jerome went to Guinness & Mahon Bankers inDublininoraround 1976 when inyfamilymoved certainmonies theyheld intheBank ofNovaScotia(inJerseybutthroughtheirGlasgowbranch)toGuinness& Mahon's associatedcompanycalledSienraInvestmentsLimitedinJersey.Thesearrangementsweremade throughMr IanKelly ofGuinness & Mahon LimitedDublin. As faraswe were concernedallourdealingwerewithGuinness& Mahon andwe wereinformed thatthe monies were inJersey. At alltimes our dealingswere through Guinness & Mahon in DublinuntilMr Lanagan-OKeefewas appointedgeneralmanagerwhen we were toldthatthese offshore funds ware tobe dealtwith throughcertainpersonnelmost particularlyMr Collery. Priorto Mr Collery,we dealtwith Rue Leonard, MartinKeane and Pat Dwyer inGuinness & Mahon Bankers. Itwas not untilthematter oftheAnsbacher affairbecoming public ourcompany Bankers who were then Intercontinental Bank Limited ("IIB"), informed me that our permanent loan for some lands which were purchased in 1991 approximately, was to be a back to back arrangement made with Ansbacher Bank in the Cayman Islands. Prior to that conversation, which took place in sometime in late 1997,1 had no knowledge that our money was in Ansbacher or the Cayman Islands. This conversation occurred probably sometime in 1997. ECBwere informing me of this fact because they were about to inform the Moriarty Tribunal or the other inspectors concerned with the Ansbacher affair. i .; At the beginning o f 1998 we were asked for documentation concerning these funds by various inspectors/tribunal and so we communicated with Guinness & Mahon Bankers Dublin to seek copies of all the documentation and statements relating to same. We received the contents of the ring binders lodged with this statement Eventually we were furnished with a copy of a Deed of Settlement dated the 27th day of November 1989 between John A Furse and Ansbacher Limited. We were also furnished with various accounts and the copy Deed of Indemnity of 6 August 1996 given by Optima Securities Limited to Ansbacher (Cayman) Limited. At no time prior to this do I recall having seen these s 7 documents or indeed the accounts of Optima Trust and Optima Securities Limited which were sent to me under cover o f the Henry Ansbacher letter of 19 January 1999. My understanding of the arrangements I had with Messrs Guinness Mahon o f Dublin, was that they were able to hold our offshore money legally ( initially in Jersey) so that it did not incur liability to tax until it was returned to Ireland; the initial funds were all earned over seas. It was not until these matters were brought into the public domain and following the McCracken Tribunal, that we understood there was a tax liability in relation to these monies even though they were overseas. When we understood this and had the bulk of the documentation contained with this statement we voluntarily disclosed the position to the Revenue and I went to Ansbacher (Cayman) Limited and completed the necessary documents to withdraw money to pay the Revenue. I enclose copy o f all documentation which I can find which has been furnished to us and which may touch on the matter which you are investigating. The IIB loan offerofIR£150,000 toushas not yet been completed as there are problems with the land security. I do not recall executing any deed of trust or other documentation in relation to these monies, save what 1 signed in Cayman in relation to the withdrawal of funds for payment to the Revenue. All my communications with Guinness & Mahon were verbal following the initial copy correspondence enclosed. I attach five copy sheets of fund movements of monies relating to this offshore money which hand written ledger sheets I received from Mr Collery and which go to December 1990. I also received one page o f a document dated 5 October while in the Cayman Islands showing monies paid out of the funds and I understand that the initials "TM" stand for Tom Morris. I do not know what TOK stands for. The cheque for D P Collery (IR£50,000) was cashed by him and he gave me the money for a business transaction which the Morris family were involved in. Kentfort Securities Limited was paid I believed in respect of a temporary loan for the purchase of a specific piece o f plant of approximately £450,000 which I now think it must have made to us forabout3 months untilourcompany had finaliseditspermanentloanfromIDB forthisplant. When thepermanent loancame throughthetemporaryloanwas repaidwithwhat Ibelievewas interestorfees i.e.thisIR£10,000. Ido notknow how thistemporaryloanwas arrangedby Mr ColleryandIwas notinformedthatitwas fromKenfortSecuritiesLimited. Itisspeculationon my behalf. M y concern was thatat the time we had to pay the supplierofthe plant and Mr Collery arranged a cheque which Icollectedand gave tothesupplieroftheplant. Ienclose a copy oftheIIB loanofferofIR£150,000whichhasnotyetcompleted. Iwould also pointoutthatin 1992my brotherMartindiedsuddenlyandhiswifestoodinhisshoesinrespect ofthe landspurchased. The hypothecatedfundsmentionedintheletterfromHerny Ansbacher dated 19 January 1999 relateto thisloan. The two payments ofIR£5,000eachbyway ofbankdrafttoBank ofIrelanddatedSMarch 1991 arestillconfusing me and Iam endeavouringtofindoutwhat theywere usedfor. Signed: "STEPHEN M MORRIS Dated this 1stday ofMarch 2000. A nsbachhr (C aym an) I im it s d p o BOX JS7 GRAND CArMAN CAYMAN ISLANDS BRITISH WEST INDIES Telephone +1 3+5 949 MSS Fuiim ile +1 3+5 949 7946 Telex CP 4305 ANSBAC C 19 January, 1999 OurRefi 6894/6904 Mr. StephenMorris "Analanda” Femdale Road Rathmichael S h a n lrill Co. Dublin ' Ireland. DearMr. Morris, Re: Optima Trust • Optima SecnritiesLimited Ireferto your recent telephone conversationwith Mr. BothweU and enclose thefollowing documents A copy ofthe TrustDeed dated 27* November, 1989. . Financial Statements for Optima Securities Limited covering theperiod from inception to SO"1September, 1998. 3) Trust Accounts for Optima Trust forfouryears ending 30* September, 1998. Accounts were not prepared priorto 1995. . 4) Copies ofdocumentation to guarantee the sum of£150,000.00 inrespectofa loan facilitymade by IrishIntercontinentalBank Limited tothe Morris family. Bank Statements reflectingthe followingbalances as at31“ December, 1998. 5) 1) 2) (a) (b) (c) (d) US$3,777.25 £3,148.02 £158,945.59 - Hypothecated £348,401.88 -Fixed Deposit Yours sincerely, *7 ' H. Kervin Glidden Senior Trust Officer HKOAmw ends. A w n b f o l lh « Flfri N a Jto n a i Banlt j THIS INDEMNITY is dated the 6th day o f August, 1996 and is given by Optima Securities Limited (hereinafter called the “Indemnifier*’) in favour of ANSBACHER (CAYMAN) LIMITED o f P.O. Box 337, George Town, Grand Cayman, Cayman Islands (hereinafter called “the Bank”). WHEREAS the Bank at the request o f the Indemnifier has issued or agreed to issue a Guarantee in the form attached (hereinafter called “the Guarantee") in favour o f Irish -\ Intercontinental Bank Limited (hereinafter called “the Lender”) in respect of certain liabilities o f Messrs. Stephen Morris, Joseph Morris, Thomas Morris, Jerome Morris and Martin Morris (hereinafter called “the Borrower'’) to the Lender. NOW THIS IS HEREBY AGREED as follows:1. . In return for the Bank at the request of the Indemnifier entering into the Guarantee the Indemnifier hereby unconditionally and irrevocably agrees:(a) to pay to the Bank on first written demand all monies whatsoever which may from time to time be claimed or demanded from the Bank which the Bank shall pay or become liable to pay under or by reason o f or in ■, .. ■■ f connection with the Guarantee; and ■ (b) to ■ indemnify and to hold the Bank harmless against all actions, claims, demands, liabilities, losses, costs, damages and expenses which the Bank may incur or sustain in connection with or arising in anyway whatsoever out o f the Guarantee. 2. The Bank shall at all times be entitled to pay any amounts demanded by the Lender under the Guarantee without any reference to or any authority from the Indemnifier and without being under any duty to enquire whether any such demand is properly made or whether any amount demanded is due and notwithstanding that the Indemnifier may dispute the validity of any such demand and the Indemnity herein contained shall extend to such amounts and shall not be affected or impaired by the fact that the Bank was or might have been justified in refusing in whole or in pan to pay such amounts or any of them. This Indemnity isto be a continuing security and shallbe in addition to and not in any way prejudiced or affected by any guarantee, indemnity, mortgage, charge, lien, or other security now or any time hereafter in force in respect of payments made, or actions, claims, demands, liabilities, losses, costs, damages, and expenses incurred or sustained in connection with or arising out of the Guarantee or by any time or indulgence or reliefgiven by theBank. The Bank may atany time and without reference to the Indemnifiergive time forpayment orgrant any other indulgence and give up, deal with, vary, exchange or abstain from perfecting or enforcing any other indemnities, guarantees, securities or other obligations whatsoever held by it at any time and discharge any party thereto, and realise the same or any of them and compound with, accept compositions from and make any other arrangement in respect ofsuch security without affectingthe Indemnifier’s liabilityhereunder. Until all liabilities hereunder have been paid or discharged in full, the Indemnifier waives allrights ofsubrogation, contribution and indemnity against the Borrower and agrees not to claim any set-offor counterclaim against the Borrower inthe event ofthe bankruptcy or theinsolvency ofthe Borrower. All payments to be made by the Indemnifierunder the Indemnity shallbe infull without any deduction, set-off or counterclaim whatsoever. The Indemnifier shall pay to the Bank interest (both before and afterjudgment) on demand on all^iTn.tpaid by the Bank under or in connection with the Guarantee from the date such sums are paid by the Bank until the Indemnifier reimburses the Bank atthe rateper annum determined by the Bank to be three (3) percent above the Bank’s cost of funding such unpaid sum from whatever source the Bank selects, such interest to be compounded at such intervals as the Bank may consider appropriate. The Indemnifier agrees that any payment made by the Bank under the Guarantee in a currency other than United States Dollars will be repaid by the Indemnifier to the Bank on demand in such other currency or if so required by the Bank in United States Dollars and that in the event of either the Bank requiring the payment in United Scares Dollars or the Indemnifier requesting the Bank to accept repayment in United States Dollars and such request being accepted by the Bank then tha rate o f exchange at which such other currency shall be converted into United 5 fatas Dollars shall be the rate of exchange (aa determined by the Bank) which prevailed on the day o f payment o f such other currency by the Bank. In addition the Indemnifier agrees that if any judgment or order is given or made for the payment o f any amount due under this Indemnity and is expressed in a currency other than that in which such amount is payable by the Indemnifier under this Indemnity the Indemnifier shall indemnify the Bank against any loss incurred by the Bank as a result of any variation occurring in rates o f exchange between the date on which such amount is converted into such other currency for the purpose o f such judgment or order and the date o f actual payment pursuant to such judgment or order. Without prejudice to any security held by Bank in respect o f the liabilities o f the Indemnifier under this Indemnity, the Bank shall have a right o f set-off over all monies standing to the credit o f any account o f the Indemnifier with the Bank in respect o f any liabilities o f the Indemnifier which become due and payable hereunder. (a) This Indemnity shall continue to bind the Indemnifier notwithstanding any amalgamation, merger or reconstruction that may be effected by the Bank with any other company or companies and in the event of any such amalgamation, merger reconstruction or o f any assignment by the Bank of its rights hereunder all references in this Indemnity to “the Bank" shall, unless the context otherwise requires,, be construed as including a reference to its successors and assigns. (b) The Indemnifier shall not assign or transfer all or any part of its rights (if any) or obligations under this Indemnity. References in this Indemnity to the Indemnifier shall be construed as including a reference to is successors. (c) This Indemnity shall remain in full force and effect until the Bank confirms in writing to the Indemnifier that the Bank has been released from all liability under the Guarantee. Tha IndenmiSer's obligations hereunder shall -not in any way be discharged or impaired whatsoever by any amendment, extension or variation o f the Guarantee. . : The Bank is at liberty but not bound to resort to any other means o f payment at any time and in any order it thinks fit without thereby diminishing the Indemnifier’s liability hereunder and may enforce its rights under this Indemnity either for the payment o f the ultimate balance after resorting to other means o f payment or for the Balance due at any time notwithstanding that other means o f payment have not been resorted to and in the latter case without entitling the Indemnifier to any benefit from such other means of payment so long as any moneys remain due or owing or payable (whether actually or contingently) from or by the Indemnifier to the Bank. No delay or omission on the Bank’s part in exercising any right, power, privilege or remedy (hereinafter together called “Rights”) in respect o f this Indemnity shall impair any such Rights, or be construed as a waiver o f any thereof No single or partial exercise o f any such Rights shall preclude any further exercise thereof or the exercise o f any other Rights. The rights, powers, privileges or remedies herein provided are cumulative and not exclusive of any rights, powers, privileges or remedies provided by law. If this Indemnity is, or purports to be, signed by or on behalf o f more that one person as the Indemnifier (or more than' one party is expressed to be a party hereto as the Indemnifier) it shall bind each such person as joint and several obligors. The obligations o f any one such person shall not be revoked or impaired by the death, incapacity, bankruptcy, winding-up or liquidation o f any other such person or by the non-execution of this Indemnity by any other such person or by any other such person not being liable for any reason to the Bank hereunder. Any notice or demand in connection with this Indemnity by the Bank to the Indemnifier shall be deemed to have been duly given if delivered personally to the Indemnifier or to his last known address or sent by post to such address and if sent by post shall be deemed to have been delivered on the first business day after fony-eight hours have elapsed following the same being duly addressed, ' stamped and posted. For the purpose of this clause, “business day" means any day except Saturdays and Sundays on which banks in the Cayman Islands are open for business. 14. • This Indemnity is to be governed by and construed in accordance with the law o f the Cayman Islands and the Indemnifier hereby irrevocably submits to the non-exclusive jurisdiction o f the courts o f the Cayman Islands in connection herewith, save the Bank is not thereby to be precluded from bringing or commencing proceedings before any other court or in any other jurisdiction. ./Dated thi3 day o f . 1996th day o f August, 1996 \ s witness the hands of the parties the day and year first above written. Signed by ■ ) ___________________________________________ * ) _____________________________________________________________________________ ___ In the presence of ___________________________________________ Signature ___________________________________________ . Address Occupation THE COMMON SEAL o f Optima Securities Limited was hereuntp^agc^in the presence o f FOR AND 0 ,'i SEHALT CF f~ i 5 a a liana . o * a » is ia „ x J U . c^d/,J*Lr Director • Director/SeeeeisHy Pursuant to a Resolution of the Board o f Directors dated 6th day of August, 1996. A uthorisation to apply Depositor ’s F unds In liquidation of DS3T of T hird Pa r t y . To: ANSBACHIR (CAYMAN) IJMTTED (“the Baric”) : In consideration of the 3ank granting a guarantee and indemnity (“the Guarantee”) in favour o f Irish Intercontinental Sank in relation to certain facilities made available to the person whose name and address appears in the First Schedule (“the Debtor”)* the undersigned (“the Depositor3’): a) agrees that notwithstanding any rule o f law or agreement to the contrary, unless the • Bank otherwise agrees, the Bank is not obliged to repay any credit balance to the Depositor unless and until all Liabilities owing or payable by any of the Debtor and the Depositor to the Bank has been pad in-full; b) agrees to indemnify the Bank against all demands, claims, liabilities, losses, costs and expenses whatsoever it may incur if the Debtor fails to settle the Debtor’s Liabilities or any part of them; . c) authorises the Bank to appropriate from all money which the Bank holds now or in the future to the Depositor’s credit on any current, deposit or other account or accounts (an “Account”) whatsoever towards the paytnent to the Bank of all the Liabilities. In this Agreement, “the Debtor’s Liabilities” means all liabilities, present or future, actual or contingent, o f the Debtor, whether as principal, agent, trustee or guarantor to the Bank whether on account of money advanced, bills o f exchange, promissory notes, guarantees, indemnities, interest, commission, fees, banking charges or otherwise howsoever and whether incurred soleiy separately or jointly and all legal fees commissions or other expenses (on a full indemnity basis) howsoever incurred by the Bank in that connection. Notwithstanding the above provisions the total amount recoverable under this Agreement will not exceed the amount (if any) stated in the Second Schedule, but if no amount is stated, or if the Second Schedule is blank, the total amount recoverable under this Agreement is unlimited The Depositor irrevocably agrees and confirms as follows: "■ 1. The Bank may return unpaid or disregard any cheque, bill or other order or instruction for payment which if debited to any Account would reduce the total balance below the balance of the Liabilities from time to time, and the Bank may title any Account as a collateral account containing references to the Depositor's obligations under this Agreement. 2. The Bank may at anytime without prior notice to the Depositor appropriate and apply all or any of the money so held to the Depositor’s credit in or towards satisfaction of all or any of the Liabilities as the Bank thinks fit, whether or not any Account which is in credit is opened before or after the date o f this Agreement, and whether or not the Bank has taken steps to enforce the Liabilities against the Debtor or the Depositor, as the case may be, which the Bank is not obliged to do. 3. This Agreement will apply not'jwthstanding that ail or part of any credit balance of the Depositor is repayable on demand or crJy at a future date or on the giving o f a length o f notice and the Bank may at any time treat the credit balance as if it is immediately payable and available for payment and set-off. If the Bank appropriates any credit balance before its maturity date the amount applied under this Agreement will be net o f the amount of the early withdrawal charge or fee (if any) which the Bank charges in the ordinary course of its deposit business. 4. This Agreement will continue and shall remain in force and will not be determined affected or prejudiced by the death or disability or liquidation o f an individual, the receivership or insolvency o f the Depositor, or by the Bank holding, taking or releasing any other or further security or by the Bank renewing varying or determining any accommodation given to the Debtor or granting time or indulgence to or compounding with the Debtor or any other person. Notwithstanding any rule o f law or agreement to the contrary, no credit balance o f the Depositor in any Account is or will be repayable by the Bank to the Deoosftor unless and until all the Liabilities have been satisfied in full. * 5. A certificate by an officer o f the Bank as to the amount o f the liabilities for the time • being will be conclusive evidence for all purposes against the Depositor. I f any sums appropriated under this Agreement are not in the. currency o f any sums owed to the Bank by the Debtor or the Depositor, as the case may be, the Bank may convert those sums into the currency o f the debt at a rate conclusively determined by the Bank acting in the ordinary course o f its foreign exchange business. ' • 6. The Depositor shall not create aor agree to create rior allow to arise or subsist any security interest whatsoever in any money which the Bank holds to the Depositor’s credit other than with the Bank’s express prior written consent. 7. The Bank may at any time in its discretion assign or endorse to the Depositor the benefit o f the Debtor’s Liabilities in pro tanto satisfaction o f the amount held to the Depositor’s credit in any Account. ' 8. None o f the following will prejudice the Bank’s rights or affect the Depositor’s liability under this Agreement: . ■ i) any failure or irregularity defect ,or informality in any agreement made or action taken by or on behalf o f the Debtor in respect o f the Debtor’s Liabilities; ii) the terms o f any other agreement which binds the Bank to the extent they conflict or appear to conflict in any way with the terms o f this Agreement; iii) any legal limitation disability, incapacity or lack o f any borrowing powers o f or by the Debtor or lack o f authority o f any director, manager, official or other person appearing to be acting for the Debtor in any matter in respect o f the Debtor's Liabilities; ■ And this Agreement being an indemnity, the Bank may recover the money from and enforce the Liabilities against the Depositor as a sole or principal debtor. . 9. Where the Depositor is a corporation its execution o f this Agreement is a representation and warranty to the Bank that the Depositor: ■ ■. • ' A D F - T h ir d P a r r y ■■ i) is validly incorporated under the laws o f its country o f incorporation and has under those laws and under its own constitution the power to enter this Agreement; ii) all corporate action and all approvals from any government tax monetary or other authorities to authorise and enable the Depositor to make this Agreement have been obtained and are in full force and effect; iii) the making o f this Agreement will not accelerate any liability o f the Depositor nor infringe any other agreement to which the Depositor is a party; and iv) the Depositor Is not the subject o f any actual pending or threatened legal proceedings which has or may have a material affect on its financial condition in this Agreement. . /- v \ , 10. Where there is more than one person comprised in the terra “the Debtor” references to the Debtor will where the context admits take effect as references to such persons or any of them and where the Debtor is a firm will include the person or persons from time to time constituting the firm whether or not under the same style or firm name and generally where the context so admits: a) singular words include the plural and vice versa; b) words of one gender include any other gender, c) “person” includes corporation; d) a duty imposed is to be performed, and a power or discretion conferred is exercisable, in each case, from time to time; e) a duty not to do something includes a duty not to permit or suffer others to do it. 11. Where this Agreement is signed by more than one person (otherwise than as agent for a named principal) the agreements on the part o f the Depositor contained in h will be binding on them jointly and severally and references to the Depositor will take effect as references to the Depositor or any o f them; and where two or more persons are named as signatories to this Agreement, it will bind any person signing it notwithstanding that • it is not signed by any one or more o f the named signatories. 12. The construction, validity and performance o f this Agreement shall be governed by the laws of the Cayman Islands. IN WITNESS whereof the Depositor has executed this Agreement as a deed the day and year written below. Messrs. Stephen Morris, Joseph Morris, Thomas Morris, Jerome Morris and Martin Morris Address: SECOND SCHEDULE A m ount: G BP150,000 Dated the day o f FOR AND ON BEHALF OP CRQMS LIMITED • EXECUTED under die Common Seal o f op-riflAfl £-um '*raa> in the presence o f- ------------------ aVTKiSEhB*-------- FOR AND ON BEHALF OF CAWSANO LIMITED "FTTeZrZTT Witness OR EXECUTED as a deed by for and on behalf of Optima Securities Limited in the presence o£ Witness A nsbacher (C ayman ) Limited H enry PO SOX 137 Ansbacher GRAND CAYMAN CAYMAN' ISLANDS BRITISH WEST INDIES TtUpkaat I 109 949 ISiS Facsimile I 109 949 794« TcUx CP 4J0S ANSBAC C 6 August, 1996 -PRIVATE & C O N FID E N T IA L The Directors Optima Securities Limited P.O. Box 887 Grand Cayman Dear Sirs, R e ; C r e d i t F a c i li t y ' We, Ansbacher (Cayman) Limited (“the Bank”), are pleased to offer you a revised revolving credit facility (She Facility”) subject to the terms and conditions set forth, below. ' 1. Obligor . Optima Securities Limited 2. .' . . Nature o f Facility . A Bank guarantee 3. Facility A m o u n t - 4. • ' . The maximum amount outstanding under the Facility will be limited to GBP150,000.00 at any time. Purpose To secure a loan facility made available by Irish Intercontinental Bank Limited to Messrs Stephen Morris, Joseph Moms, Thomas Morris, Jerome Morris and Martin Morris. . 5. Fee V* o f 1% p.a. to be taken as a differential between the Obligor’s deposit with the Bank and the Bank’s deposit with Irish Intercontinental Bank Limited. 6. Security As security for ail monies outstanding under the Facility we shall rely, and continue to rely upon: 00 the indemnity dated 6th August, 19.96, issued by the Obligor's wherein the Obligor agrees to indemnify and to hold the Bank harmless against all actions, claims, demands, liabilities, Josses, costs, damages and expenses which the Bank may incur or sustain in connection with or arising in any way whatsoever out o f or in connection with the Guarantee; and (b) a cash deposit o f an amount equal to the Facility which shall be placed with the Bank and secured by the Authorisation To Apply Depositor’s Funds in Liquidation o f Debt o f Third Party, dated 6th August, 1996. (together the “Security'’) • The Security will enjoy full rights o f consolidation with any other security held by us in respect o f any other facility granted by us to the Obligor from time to time. ■ 7. Conditions A certified copy o f the board resolution o f the Obligor and the Guarantor accepting the Facility on the terms and conditions of the Facility Letter and authorising a specified person or persons to sign and return the duplicate o f this letter by way o f acceptance. 8. Review/Termination ' This Facility will be reviewed by us periodically, may be modified, reduced, or terminated at any time by us at our sole discretion and, in any case, will expire, without prejudice to your liabilities to us, on 29/8/97 provided that it has not been renewed by us in writing before the said date. Notwithstanding any other provision of this Facility Letter, it is expressly agreed that all liabilities will be and shall remain repayable on demand and we expressly reserve our right to call for full cash cover in respect o f contingent and prospective liabilities. Ail payments due to be made by the Obligor to us hereunder shall be made to us in full •without any deduction or withholding (whether in respect of set-of£ counterclaim, duties, tax, charges or otherwise). . 10 Default Interest If the Obligor rails to pay any amount payable by h Under this Facility Letter on the due date or if appropriate on dem and, it shall (without prejudice to any other rights we may have) pay interest on such overdue amount from the due date up to the actual date o f payment, as well after as before judgement and compounded monthly, at 3% per annum over our fluting prime rate. The Obligor shall indemnify us on demand against any losses, casts, liabilities, or expenses including legal fees sustained by us as a consequence o£ any default or delay in payment by the Obligor of any sums, due under this Facility Letter. Kindly sign and return to us the duplicate o f this letter to signify your understanding and acceptance of its contents. The offer o f the Facility shall lapse if we do not receive the signed duplicate o f this letter on or before 6th September, 1996. Yours faithfi'Hv • For and on Ansbache J. B. Botin Managing Agreed to and Accepted by: Agreed to and Accepted by; FOR AND O N SSHAIF OF Authorised Signature ^1 Optima Securities Limited < Authorised Signature Optima Securities Limited A p p en d ix X V 1. (93) M r J o h n M u lh e r n Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John Mulhern. a) Transcript of evidence of Mr John Mulhern dated 9 May 2001. b) Statement of Mr John Mulhern dated 23 March 2001. c) Share purchase agreement o f 29 October 1993 - College Trustees Limited & Clayton Love Distribution Limited. d) Letter o f 30 July 1992 - Ansbacher Limited to IIB. e) IIB statement of 15 March 1993 re Cayman International Bank & Trust Company Limited. f) Annsbacher Limited statement dated October 1992 re Ansbacher Limited Cayman a/c no 80024123. g) Letter of 27 July 1993 - Hamilton Ross Co Limited to IIB. h) IIB statement o f 29 July 1993 re a/c no 02/01354/81. i) Extract from a/c headed G & M Limited, Jersey Trust Trustees o f 24 January 1974. j) Internal Guinness and Mahon memo re resident loan accounts. k) Letter of 7 December 1990 - Ansbacher Limited to Guinness and Mahon. 1) Extract from internal Guinness and Mahon memo headed ‘suitably secured - all references’. m) Letter o f 16 February 1994 - Hamilton Ross Co Limited to IIB. n) Report & financial statement re Ice Cream Marketing Limited ending 31 July 1995. o) Consolidated cash flow statement re Clayton Love Distribution Limited ending 31 July 1994. p) Letter of 2 July 2001 - Secretary to Inspectors to Reddy Charlton McKnight Solicitors. q) Letter o f 13 August 2001 - Reddy Charlton McKnight Solicitors to Inspectors. Correspondence received from or on behalf of Mr John Mulhem. a) Letter and enclosures of 27 November 2001 - Reddy Charlton McKnight Solicitors to Inspectors. UNDER OATH ON WEDNESDAY, 9TH MAY 2 0 01 I hereby c e r t i f y the f o l l o w i n g t o b e a t r u e and accurate tra n sc r ip t shorthand n o tes o f my in the a b o v e named i n t e r v i e w . Stenographer JUDGE S . The I n s p e c t o r s : MS. S olicitor to the Inspectors N. O'LEARY MACKEY BL MS. M. CUMMINS Interview ee: MR. J. MULHERN R e p r e s e n t e d b y: MR. H. MOHAN SC I n s t r u c t e d b y: MR. D. O'DOWD R eddy C h a r l t o n & Mc Kni gh t 12, Fitzw illiam Dublin 2 Place 1 2 3 4 JUDGE O'LEARY: Mr. 5 Mulhern, t h a n k yo u v e r y much i n d e e d f o r 6 coming. 7 schedule 8 it greatly. 9 It is We know i t lik e is yours to not e a sy w ith a busy fit I hope i t it i n b u t we a p p r e c i a t e w o n 't be v e r y lo n g . a m a t t e r o f a number o f q u e s t i o n s . What we 10 are doing - - 11 is 12 in vestigatin g 13 It 14 Ansbacher. 15 As p a r t o f o u r j o b i n v e s t i g a t i n g A n s b a c h e r , 16 o b v i o u s l y we h a v e t o a s c e r t a i n 17 b u s i n e s s which t h e y c a r r i e d out i n v a r i o u s p l a c e s . 18 B e c a u s e we a r e a s k e d t o do i t 19 have t o i d e n t i t y where p o s s i b l e 20 Ansbacher. 21 j u d g m e n t s on c l i e n t s 22 job. 23 id e n t it y the 24 that 25 a c t i v i t y which t h e 26 m ig h t have any know ledge o f i t . 27 of course 28 d i r e c t e d t o w a r d s e s t a b l i s h i n g w h e th e r or n o t you a r e 29 w i t h i n t h e m e a n i n g o f w ha t t h e H i g h C o u r t o r d e r h a s and t h i s in vestigatin g is is im portant to a c om pa ny . you, em phasise - ­ We a r e n o t we a r e i n v e s t i g a t i n g n o t y o u r c o mpa ny , That i s a c om pa ny . we a r e i n v e s t i g a t i n g wh a t we a r e i n v e s t i g a t i n g . the ex ten t of the b y t h e H i g h C o u r t we clien ts of We a r e n o t g o i n g t o make v a l u e T ha t i s I w ill o f Ansbacher, someone e l s e ' s clien ts ask w i l l that job. is B u t we h a v e t o of Ansbacher. The q u e s t i o n s obviously r e la te to the type of company e n g a g e d i n s o f a r I understand th a t. And i f It n o t our a s you you d o n ' t , a l s o w i l l be 1 2 3 H e re t o d a y i s Ms. 4 inspectors. I am a n o t h e r o f t h e i n s p e c t o r s . 5 Sean O'Leary i s 6 inspectors 7 a nd r e p o r t t o t h e H i g h C o u r t . N o r e e n M ac k e y , my name. one o f t h e We a r e t w o o f t h e four a p p o i n t e d t o h e a r a nd g a t h e r t h e e v i d e n c e 8 9 I n s o f a r a s t wo o f t h e i n s p e c t o r s on ly are p resen t 10 today, 11 d e a l i n g w i t h any m a t t e r which m ig h t a r i s e 12 you rself. 13 yourself, 14 w ould be d e a l i n g w i t h i t 15 inspectors. 16 operate i n t h a t way. 18 This i s a very inform al procedure. 19 really o n l y t wo f o r m a l p o r t i o n s 20 One i s t h a t we r e q u i r e y o u t o t a k e t h e 21 second i s 22 p rovision s 23 sign the tr a n sc r ip t 24 a s a t r u e a nd a c c u r a t e r e c o r d , 25 any c o r r e c t i o n s o r c h a n g e s t h e r e may b e i n i t . 26 Other than t h a t it 27 procedure. 28 Our s o l i c i t o r , 29 oath. they w ill b e t h e t wo i n s p e c t o r s t h a t w i l l be concerning T h e r e m i g h t b e no m a t t e r c o n c e r n i n g but i f t h e r e was we w o u l d b e t h e t wo t h a t ra th er than the From a p r a c t i c a l a b s e n t t wo v i e w p o i n t we h a v e t o 17 that u ltim a tely There a re of i t I w ould s a y . o a t h and t h e in accordance w ith the o f t h e C o m p a n i e s A c t we r e q u i r e a t t h e end o f t h e y ou t o exam ination obviously subject w i l l be q u i t e to an i n f o r m a l I w o u l d a s k y o u now t o t a k e t h e o a t h . Ms. Cummins, w ill ad m in ister the 1 2 3 4 1 Q. JUDGE O'LEARY: Thank y o u v e r y much f o r 5 coming, 6 We h a v e g o t y o u r u n s w o r n s t a t e m e n t 7 is 8 from somebody b e c a u s e 9 to operate. 10 a good s t a r t Mr. Mulhern. (Exhibit 1). It f o r u s t o h a v e an u n s w o r n s t a t e m e n t it gives us t h e b a s i s on w h i c h Have y ou r e a d t h e u n s w o r n s t a t e m e n t yourself? 11 A. 12 2 Q. I have. A re y o u s a t i s f i e d w i t h e v e r y t h i n g i n t h e unsworn 13 s t a t e m e n t or a r e t h e r e any c h a n g e s you w ould l i k e 14 make? 15 A. 16 17 The o n l y c h a n g e s are th a t to t h e d a t e s m ig h t n o t be exactly correct. 3 Q. 18 We a r e n o t t e r r i b l y concerned about th a t aspect of the thing? 19 A. 20 4 Q. Other than t h a t I don't What I f i n d s o m e t i m e s -- think there a r e any c h a n g e s . I am s u r e i t d oesn't apply 21 in your c a se 22 statem ent th at has been put t o g e t h e r by a s o l i c i t o r 23 or a b a r r i s t e r or somebody l i k e 24 in the m iddle o f i t 25 the 26 confusion. 27 ar e t h e y happy w i t h t h e s t a t e m e n t . 28 you have your s o l i c i t o r 29 are v e r y welcome. statem ent -- is at that people 'I d o n 't a ll' come i n w i t h a that really a nd t h e y f i n d know w ha t i s a nd t h e y f i n d t h e m s e l v e s in in So n o r m a l l y we s t a r t b y a s k i n g p e o p l e This We n o t e t h a t a nd b a r r i s t e r is not t r i a l , h e r e and t h e y th is is a 1 m e re e x a m i n a t i o n o f y o u f o r g a t h e r i n g i n f o r m a t i o n . 2 However, 3 e x a m i n a t i o n you f e e l 4 your l e g a l 5 to 6 room o r we w i l l 7 consultation 8 if 9 lik e if at anytime during the co u rse advisers s t o p a nd we w i l l eith er y ou w i s h t o c o n s u l t or b o t h o f them, of the eith er you can a s k us s t o p and you ca n w i t h d r a w t o t h e w i t h d r a w and you ca n h a v e your a n d t h e n we w i l l o f th o s e at anytim e t o c o n s u l t w i t h you, all c o mme nc e. feel Sim ilarly, t h a t t h e y would t h e y h a v e t o do i s 10 t o us 11 facility. 12 go on b u t i f it 13 all, t a k e a b r e a k a nd t h e r e w i l l b e t e a 14 coffee " s t o p " a nd we w i l l p r o v i d e p r e c i s e l y t h e I don't we w i l l available of know how l o n g t h e same interview w ill g o e s on f o r a n y l e n g t h o f t i m e a t f o r y ou d u r i n g t h e course 16 Mr. 17 C l a y t o n L o ve D i s t r i b u t i o n 18 A. 19 5 Q. 20 A. 21 6 Q. 22 A. 23 7 Q. 24 25 That's Was i t that business June 2 1 s t that right? in operation? 1966. e sta b lish e d afresh at that stage? Yes. The C l a y t o n L ov e name was t h e r e , sign ifican ce A. is right. How l o n g i s Since you a r e i n v o l v e d i n t h e b u s i n e s s Ltd, a nd t h e attached to that? The company a t t h e t i m e b e l o n g e d t o t h e C l a y t o n L o ve f a m i l y . 26 27 8 Q. 28 A. 29 9 Q. Were y o u i n v o l v e d i n i t ? I was t h e m a n a g i n g d i r e c t o r . It is lik e a d re am t o me, and of i t . 15 Mulhern, say b u t d i d C l a y t o n Love of 1 2 A. 3 10 Q. 4 A. 5 11 Q. 6 Not i n C l a y t o n Love D i s t r i b u t i o n L t d . He n e v e r w o r k e d i n t h a t ? No. You h a v e b e e n t h e m a n a g i n g d i r e c t o r since that tim e, h a v e yo u? 7 A. 8 12 Q. 9 A. 10 13 Q. S in c e t h e day i t Are you s t i l l was s e t u p . t h e managing d i r e c t o r of the For my s i n s . I know a b o u t t h e shareholding; 11 that U l t i m a t e l y you a r e t h e 12 in the company? That's correct. 13 A. 14 14 Q. later I realise on. that various 15 The s h a r e h o l d i n g o f t h e 16 it 17 stage? 18 A. 19 15 Q. 20 company? outset, T h ey h a d t h e about shareholder c h a n g e s went on. co mpa ny a t t h a t t h e L ov e f a m i l y who h a d t h e At t h e we m i g h t t a l k stage, was shareholding at that yes. s h a r e h o l d i n g and you a c q u i r e d i t t o g e t h e r w i t h somebody e l s e ? 21 A. 22 16 Q. 23 In 1972 w i t h t h e N e s t l e c o m pa ny . What w e r e t h e y o p e r a t i n g in I r e la n d as a t th e tim e, n o t u n d e r t h e N e s t l e name I w o u l d s a y ? 24 A. 25 17 Q. T h ey w e r e F i n d u s ? 26 A. Th e y w e r e F i n d u s . 27 18 Q. 28 A. 29 19 Q. We w e r e s e l l i n g Findus frozen And y o u w e r e d i s t r i b u t i n g foods. Findus foods? Yes. You t o o k 55% o f t h e s h a r e h o l d i n g and N e s t l e 1 2 3 20 Q. 4 P r e s u m a b l y t h e n y o u c a r r i e d on on t h a t b a s i s for some t i m e ? 5 A. 6 21 Q. Yes. You w e r e i n t h e m a j o r i t y s h a r e h o l d i n g a n d I p r e s u m e 7 th eir 8 frozen food products? That's correct. 9 A. 10 22 Q. 11 in terest was t h e d i s t r i b u t i o n B ut a s c a n h a p p e n i n t h o s e alm ost i n e v i t a b l e 12 A. 13 23 Q. 14 A. That's What a c t u a l l y h a p p e n e d ? I think con trol o f t h e co mpa ny b e c a m e s o m e t h i n g t h a t 16 d i d n ' t w a nt t o g i v e u p. 18 A. changes are right. t h e y w i s h e d t o h a v e and i t 24 Q. situ ation s, I think? 15 17 o f t h e i r branded They b e g a n t o A gitate was s o m e t h i n g t h a t I ...(INTERJECTION)? a nd c a u s e p r o b l e m s w h i c h w e r e j u s t 19 u n a c c e p t a b l e a nd we s p e n t t o o much t i m e t a l k i n g 20 l a w y e r s a nd n o t e n o u g h t i m e l o o k i n g a f t e r 21 bu sin ess. 22 25 Q. 23 A. 24 26 Q. 25 A. 26 27 Q. 27 Where w e r e y o u o p e r a t i n g o u t o f a t t h a t At t h a t 28 A. 29 28 Q. s i t u a t i o n became a p o s s i b i l i t y ? seemed t o be t h e o n l y s o l u t i o n . When d i d t h a t Mr. a c t u a l l y come t o fru ition , Mulhern? I think stage? s t a g e we w e r e o p e r a t i n g o u t o f C a b r a . A buy-out It the 1982 o r 1 9 8 3 , In 19 82 /1 9 8 3 that period. you w a n te d t o buy them o u t ? to 1 We h a d t o 2 c o u l d b e f o u n d was t o 3 t h e y c o u l d buy us out f o r t h a t 4 buy them out or f i n d somebody t o buy them ou t 5 the 6 29 Q 7 8 find a so lu tio n fix a nd t h e o n l y s o l u t i o n on a f i g u r e figure and e i t h e r o r we c o u l d for agreed fig u r e . Was i t a very su b sta n tia l sum o f m on e y a t t h a t stage? A 9 10 30 Q 11 A 12 31 Q 13 It seemed a t t h e tim e t h a t it was b u t when yo u l o o k back at i t , it was a p i t t a n c e . What was i t in fact? £300,000 for the I t was s t i l l 45%. a substantial sum o f m one y a t t h a t stage? 14 A 15 32 Q If you d i d n ' t E xactly. have i t , I think it was. I would have found m y s e l f i n t h a t 16 p osition 17 You i n s t r u c t e d Mr. 18 a d v iso r during th a t n e g o t ia t io n , 19 that A at th at tim e, I w o u l d n ' t have had i t . Desmond T r a y n o r t o He h a d b e e n my a d v i s o r s i n c e . . . is act that back in as your correct? 1 9 6 4 h e was 20 on t h e p a n e l , 21 g r o u p and h e was on t h e p a n e l t h a t 22 f o r my o r i g i n a l 23 So I h a d known h i m f r om 1 9 6 4 a nd he h a d made i t 24 p ossible 25 D istribution 26 been th ere to 27 33 Q 28 A 29 34 Q he was t h e d i r e c t o r in the job w ith the first In t h e background? Yes . i n t e r v i e w e d me co mpa ny i n instance 1964. t o g e t C l a y t o n Love L t d up and r u n n i n g . assist. o f C l a y t o n Love He h a d a l w a y s 1 2 35 Q. 3 4 A. 36 Q. 7 A. 8 37 Q. 9 A. 10 We may h a v e d o n e some c u r r e n c y t r a n s a c t i o n s No, they w eren't. Your m a i n b a n k e r s w e r e ? The c o m p a n y ' s m a i n b a n k e r s w e r e e i t h e r or i n t h o s e y e a r s 38 Q. Presumably in Mr. 13 accountant ? A. Traynor, 16 39 Q. 17 A. 18 40 Q. 19 A. 20 41 Q. 21 1 9 64 when y o u w e r e i n t e r v i e w e d b y h e was a c t i n g mo r e o r l e s s A. 23 42 Q. 24 A. 25 43 Q. o f C l a y t o n Love Of t h e Group? Yes. Was h e s t i l l w i t h Ha u g he y B o l a n d a t t h a t stage? He w a s . By t h e t i m e we move on t o t h e That's 1982 s i t u a t i o n , h e was & Mahon? correct. And o f c o u r s e y o u w o u l d h a v e k e p t c o n t a c t w i t h him? That's correct. R i g h t up t o t h e t i m e o f t h i s 26 Mr. 27 activ ities ? A. d irecto r a s an Ltd. w o r k i n g now i n G u i n n e s s 22 U l s t e r Bank C i t y Bank. He was a n o n - e x e c u t i v e D istribution 15 29 with B ut t h e y w e r e n o t y o u r m a i n b an k? 12 28 & them . 6 14 s t a g e w ith Guinness Mahon? 5 11 Were y o u b a n k i n g a t t h a t No, him . Traynor e v e r I d id n 't sought to have t h a t sort n e g o t i a t i o n had in terest you i n o f f s h o r e o f an i n v o l v e m e n t w i t h 1 44 Q. So he n e v e r s a i d t o y ou t h a t 2 trust 3 North o f 4 at a ll? 5 A. 6 45 Q. 7 8 or a d e p o s i t 9 i n t h e Channel I s l a n d s I r e l a n d o r t h e Cayman I s l a n d s You d o n ' t t h i n k you w o u ld h a v e b e e n a s u i t a b l e for h is I didn't scheme a t t h a t stage? know a n y t h i n g a b o u t t h e 10 know a n y t h i n g a b o u t t h e 11 t h e bank. 46 Q. 13 A. 14 47 Q. 15 A. 16 48 Q. 17 A. or th e or any p l a c e schem e; l o o k b a c k we know a l o t mo r e o b v i o u s l y . 12 a I owed mone y t o hi m. recruit A. you c o u l d e s t a b l i s h scheme, when we I didn't I was a d e b t o r t o You n e e d e d £ 3 0 0 , 0 0 0 ? Yes. Who came up w i t h t h e solution t o t h e problem? Des T r a y n o r d i d . Do y o u reme mbe r w h at h e s a i d t o y o u , The s i t u a t i o n Mr. Mulhern? was t h a t we h a d s p e n t a d a y i n t h e 18 so licito r's 19 r e p o r t t o hi m i n t h e e v e n i n g a nd I r e p o r t e d t o hi m 20 t h a t we h a d n ' t made a n y p r o g r e s s . 21 may j o i n 22 So h e came t o t h e m e e t i n g a nd s a i d 'My c l i e n t 23 d o e s n ' t w a nt a n y more l e g a l b i l l s , he d o e s n ' t wa nt 24 a n y more o f t h i s 25 we w i l l 26 a nd y o u c a n h a v e t h e co mpa ny o r we w i l l 27 45% o f 28 th ought about i t 29 a nd we w i l l a nd we w e r e g e t t i n g n o w h e r e . the m eeting, name a f i g u r e . it He s a i d we w i l l p r o g r e s s stress. a g r e e on t h e 'If You c a n g i v e give y ou They name t h e same b a s i s ' is u s 55% o f i t com pany.' 'We w i l l I it.' And t h e o n l y s o l u t i o n and we w i l l h a v e t h e and s a i d I was t o figure s o t h e y named 1 the 2 to 3 a nd t h a t 4 4 9 Q. 5 A. 7 50 Q. 8 is know w h e r e t h e "JDT" h a d c o m m i t t e d h i m s e l f t o It all h a p p e n e d i n h a l f an h o u r . When y o u w i t h d r e w f r om t h e m e e t i n g d i d y o u s a y Traynor, The s i t u a t i o n th is is a b it fr u s tr a tin g because 12 didn't 13 a nd t h i n g s . 14 forwards between o u r s e lv e s 15 total 16 that 19 know a l o t about, legal was v e r y that and i t was a But t h e y w o u l d f r u s t r a t e When y o u came o u t w ha t d i d Mr. you; operate. T r a y n o r s a y t o y ou about th e arrangements? A. He s a i d 'We w i l l look a f t e r 21 Trustees 22 u n til 23 52 Q. 24 A. 25 53 Q. 26 A. 27 54 Q. I te r m s and c o n t r a c t s and N e s t l e t h e way m u l t i n a t i o n a l s a nd I t h i n k h e s a i d 29 a nd i t We w e r e p u s h i n g p a p e r b a c k w a r d s and 20 28 to m e.' I was d e a l i n g w i t h t h i n g s waste of tim e. is of a surprise was t h a t h e d e c i d e d t h a t t h e 11 18 surprised turn o f even ts? f r u s t r a t i o n was t o o much, 51 Q. it w ha t was d o n e . 10 17 45% was g o i n g No d o u b t y o u w e r e l o o k i n g on i n a r a t h e r 'Mr. A. I d id n 't come f r o m b u t way a t t h i s 6 9 figu re. Ltd w i l l 'A co mpa ny c a l l e d C o l l e g e own t h e shares s u c h t i m e a s y ou s e l l C ollege Trustees t h e paperwork tomorrow' fo r th e tim e b ein g the b u s in e s s .' Ltd bo u g h t t h e shares? 45%. D i d y o u know a n y t h i n g a b o u t C o l l e g e Trustees? N ever h e a r d o f them b e f o r e . D i d y o u s a y t o Mr. T r a y n o r who c o n t r o l s Trustees in charge o f i t o r who i s C ollege o r who owns i t ? 1 2 55 Q 3 4 D i d y o u know a t t h a t stage th at C ollege a s u b s i d i a r y co mpa ny o f G u i n n e s s A I assumed i t was b e c a u s e T r u s t e e s was & Mahon? I t h o u g h t o f C o l l e g e G r e en 5 b e i n g where G u in n e ss 6 s o m e t h i n g t o do w i t h C o l l e g e G r e e n a nd t h e r e f o r e 7 was p r o b a b l y a s u b s i d i a r y o f t h e i r s . 8 56 Q 9 A 10 57 Q 11 A 12 58 Q & Mahon w e r e a nd t h a t You d i d n ' t know t h a t ? No. C ollege Trustees acquired i t . l o o k i n g b a c k w a r d s a t how s u c c e s s f u l 15 afterwards 16 C ollege Trustees 17 in C ollege Trustees 18 purchase? 59 Q 21 A 22 23 form t h e Reading through t h i s 14 20 -- that im pression - - in fact it I know i t m ig h t be you were was y o u r m one y i n t h a t was u s e d . T h a t y o u ha d mone y and t h a t was u s e d t o execu te the No. D i d y o u h a v e mone y i n C o l l e g e T r u s t e e s No, at that time? I ha d n e v e r h e a r d o f C o l l e g e T r u s t e e s b e f o r e that night. 60 Q The way Mr. Traynor o p e r a te d i s 24 m on e y i t 25 a nd l e g a l 26 across 27 honourably but th a t 28 t h e co mpa ny t h a t 29 it I hadn't a clu e. one m igh t A h ad D i d y o u know w h e r e t h e m one y came f r o m u l t i m a t e l y ? 13 19 it that if w o u l d e n d up i n an a c c o u n t a l l in the y o u g a v e hi m legitim ate s e n s e t h a t we h a v e n e v e r come a c a s e w h e r e he d i d n ' t t r e a t people th e y m ight not know t h e name o f t h e mone y w o u l d g o i n t o ? 1 2 61 Q. We h a v e come a c r o s s a lot of people, Mr. Mulhern, 3 who owed q u i t e 4 s i m u l t a n e o u s l y ha d mone y a b r o a d w h i c h t h e y 5 d i d n ' t . . . ( INTERJECTION)? 6 A. 7 62 Q. 8 a substantial That w a s n ' t t h e case. P a r t i c u l a r l y where p e o p l e were i m p o r t i n g g o o d s . Were y o u i m p o r t i n g g o o d s ? 9 A. 10 63 Q. Yes. You know t h e i d e a o f w h a t we w i l l 11 its 12 p rices 13 s kimme d o f f 14 p eop le doing th a t 15 amount o f m one y b u t A. 16 p olite name some " d i f f e r e n t i a l would be i n f l a t e d elsew here. I h aven 't but into th is 64 Q. 18 A. 19 65 Q. 20 Is A. 22 66 Q. invoicing" I can j u s t a s s u r e you t h a t in that Th e y w o u l d n ' t sell 27 28 on t o y o u? No. As f a r a s y o u w e r e c o n c e r n e d i t 29 That's correct, was t h e s e You s a i d y o u u n d e r s t o o d t h e yes. What h a p p e n e d t o t h e c o n t r o l thereafter A. fashion. t o a C h a n n e l I s l a n d co mpany who c ompany t o b e an i n v e s t m e n t v e h i c l e ? 67 Q. you would That would n o t be p o s s i b l e . 24 26 where so rt o f thing? C ollege T ru stees. A. it c o u n t r y and 23 25 give that right? would s e l l 21 to I am s u r e y o u h a v e h e a r d n o t be a b l e t o t r a d e w i t h N e s t l e 17 call It just p eriod . of the co mpa ny on a d a y - t o - d a y b a s i s ? c a r r i e d on a s i t had done i n t h e p r e v i o u s 1 68 Q. 2 A. 3 Did you r e t a i n your N e s t l e connection? I h a d my 55% a nd we k e p t on s e l l i n g Findus frozen foods. 4 69 Q. 5 A. 6 70 Q. You r e t a i n e d t h a t agency, was t h a t p a r t o f t h e d e a l ? Yes. You c a r r i e d on a n d y o u s o l d Findus foods. D i d Mr. 7 C o l l e g e T r u s t e e e v e r k n o c k a t y o u r d o o r a nd s a y 8 a r e you d o i n g , 9 A. I would g e t 'How Mr. M u l h e r n ? ' a call a n n u a l l y f r o m JDT i f I didn't 10 m e e t hi m s o m e w h e r e a nd h e w o u l d a s k how i s 11 I w o u l d s a y n o t t o o b a d a n d h e w o u l d s a y s e n d u s on 12 a set 13 a c c o u n t s and t h a t 14 71 Q. 15 A. 16 72 Q. 17 18 To G u i n n e s s 20 73 Q. 21 A. 22 7 4 Q. 23 A. 25 75 Q. you w ould h e a r . & Mahon. appropriate people? As l o n g a s t h e g r a p h was g o i n g t h e r i g h t way i t seem t o c o n c e r n him. He w a s n ' t a v e r y h a n d s - o n i n v e s t o r ? No. Did you g e t the i m p r e s s i o n t h a t maybe i t was h i s own No. As y o u w i l l 26 their 27 for 29 a ll investm ent ? 24 28 is As f a r a s y o u w e r e c o n c e r n e d t h e y w o u l d b e s e n t down didn't 19 You w o u l d s e n d hi m on t h e You w o u l d s e n d t h e m on t o w h e r e ? to the A. of accounts. business. A. ap p reciate people own i n v e s t m e n t s b u t i f can be l a i d back about y o u a r e i n v e s t i n g mone y s o m e b o d y e l s e . . . ( INTERJECTION)? I don't b e lie v e it was. I t n e v e r s t r u c k me b u t 1 7 6 Q. 2 Have y o u e v e r down t h r o u g h t h e y e a r s e s t a b l i s h e d who t h e b e n e f i c i a l 3 A. 4 77 Q. No, C ollege Trustees possib le 6 possib le. 7 were h o l d i n g i t 8 they are, 9 f o u n d o u t who i t A. that w ere q u i e t 12 happy. 78 Q. is a trust c o m pa ny . t h e y owned i t But i t c o m pa n y . d id n 't a nd l e t c o n c e r n me. We w i l l move a l o n g t o 1992. 16 D istribution 19 A. 20 80 Q. 21 A. 22 81 Q. 23 A. Ltd. I do. Who a p p r o a c h e d y o u ? W aterford Foods. T h ey w a n t e d t o b u y y o u o u t ? Yes. You w e r e n o t sym pathetic to th a t, d i d t e n d t o go a l o n g w i t h i t at 25 n eg o tia tio n s progressed i t 26 unacceptable. A. 29 I was q u i t e Do y o u reme mbe r t h a t ? 24 28 As l o n g a s t h e y i n C l a y t o n L o ve p rice 82 Q. wha t f o o d p r o c e s s i n g co mpa ny w i t h I suppose e v e r y t h in g has i t s 27 is At t h a t t i m e y o u w e r e a view to purchasing the shares 7 9 Q. th at they You n e v e r me r u n t h e b u s i n e s s 15 18 is was? approached by a l a r g e r A. is that f o r somebody b e c a u s e t h a t 14 17 It them selves, i s much mo r e l i k e l y they are a t r u s t At t h e t i m e i t 11 13 o w n e r wa s? S ir. 5 10 ever Their p r ic e w asn 't r ig h t The p r i c e was r i g h t , w ere t r e a t i n g just w e r e y ou? an d I c e r t a i n l y first but as th e was g o i n g t o b e effectively? t h e m an ne r i n w h i c h t h e y t h e b u s i n e s s was n o t g o i n g t o b e 1 2 83 Q O bviously i f 3 T rustees, 4 in terest 5 A 6 84 Q 7 A 8 9 it is accept 11 45% a r i s e . t o you, he s a i d , Whose i d e a was i t , what t h e y c a l l 15 left 16 three 17 y e a r s was g o i n g t o 20 how d i d i t The o f f e r was r e j e c t e d n o t b e c a u s e 14 19 offer and a t same t i m e o r s h o r t l y t h e r e a f t e r b u y i n g o u t t h e concerned but rath er with the 86 Q C ollege Trustees i t . ' 13 18 offer. g e n e r a l approach? How d i d t h e q u e s t i o n o f r e j e c t i n g t h e the A Desmond t h a t we h a d t h e su itab le 10 12 h a d some i n t h e outcome a s w e l l ? What was h i s 'If C ollege w h o e v e r t h e y may h a v e b e e n , I had t o t e l l w ill 85 Q t h e p r i c e was g o o d t h i s an " e a r n - o u t . " running th e b u s in e s s years figu res f a c t t h a t t h e r e was I was g o i n g t o b e f o r a minimum o f and t h e p r o f i t a b i l i t y affect of the arise? the for those three fin al figure. I t was g o i n g t o d e t e r m i n e y o u r p r i c e , I understand that. A The a g r e e m e n t was t h a t no f i n a n c e s w o u l d b e t a k e n 21 out of the 22 the 23 negotiation s 24 in the 25 flow 26 gone. 27 it 28 going to take 29 agreement th a t co mpa ny b y W a t e r f o r d f o r t h e p e r i o d o f "earn-out". But i n t h e t h e r e was £ 1 , 5 0 0 , 0 0 0 co mpa ny g o n e . figu res going i n c a s h t h a t was cash f o r w a r d t h e r e was £ 1 , 5 0 0 , 0 0 0 and t h e y s a i d it days o f th e When we l o o k e d a t t h e I asked the p eop le gone' latter o u t.' from W a te r f o r d 'Where i s 'You d o n ' t n e e d i t And I s a i d ' No , th a t w ouldn't happen.' s o we a r e we h a d an So i t just 1 s t r u c k me t h a t 2 m isery i f 3 87 Q. 4 A. 5 88 Q. 6 7 t h e t h r e e y e a r s were g o i n g t o be a I went t h r o u g h w i t h t h i s . So y o u d e c i d e d a g a i n s t it? Yes. What a b o u t t h i s other su g g e stio n then th a t buy o u t C o l l e g e T r u s t e e s . A. How d i d t h a t y ou w o u l d come a b o u t ? Th e y h a d b e e n i n v o l v e d f o r t e n o r e l e v e n y e a r s and 8 h a d n e v e r ha d a d i v i d e n d on t h e b a s i s 9 b u s i n e s s was g o i n g t o b e s o l d o n e d a y a n d t h a t was 10 g o in g t o be t h e i r 11 appetite 12 sale 13 som ething about i t . 14 89 Q. Having w e t t e d h i s about th e thought o f s e l l i n g Did t h e i n i t i a t i v e come f r o m t he m a t t h a t A. I think so. 18 affect 19 o u t y o u r own co mpa ny s h a r e s b e c a u s e 20 th e Act a y e a r or so b e f o r e , 21 a solu tion . 22 ou tsid ers 23 w ith the com pany.' 90 Q. 25 So h i s u s a d v e r s e l y and i t Then he s a i d t o worry about, s u g g e s t i o n was t h a t it wouldn't was t h e n p o s s i b l e of the A. 27 91 Q. h e came up w i t h t h i s 'You w o n ' t h a v e a ny y o u c a n do w h a t y ou l i k e y o u w o u l d b u y y o u r own Yes. Whi c h h a d b e c o m e l e g a l t o buy change in shares ? 26 29 stage When JDT r e a l i s e d t h e r e was a c e r t a i n amount o f c a s h i n t h e co mpany an d t h a t 28 tim e, was i n t h e i r m i n d a nd t h e y w a n t e d t o do 17 24 at that r a t h e r t h a n y o u? 15 16 return. th a t the in accordance w ith the as 1 92 Q 2 A 3 93 Q 4 A That i s w h at h a p p e n e d . Where d i d y o u g e t t h e m on e y t o do t h a t ? T h e r e was t h e £ 1 , 5 0 0 , 0 0 0 t h a t we w e r e t a l k i n g 5 t h a t was i n t h e b u s i n e s s a nd we b o r r o w e d w h a t e v e r 6 o t h e r m o n i e s we n e e d e d f r o m N a t i o n a l 7 94 Q 8 A 9 95 Q 10 A 12 96 Q 13 A Ba nk. Whic h was how much? I t h i n k we b o r r o w e d n e a r l y £ 1 , 0 0 0 , 0 0 0 . During a l l th is Des T r a y n o r ' s 11 Irish about t i m e ha d y o u d o n e a n y b u s i n e s s w i t h co mpa ny i n Dublin? Whic h company? With G u in n e ss & Mahon? He was l o n g g o n e f r om G u i n n e s s & Mahon a t t h a t 14 stage. & Mahon a l o t 15 m on e y f o r many a n d v a r i o u s 16 late 17 97 Q I still owed G u i n n e s s things of r i g h t up t o t h e 1990's . What a b o u t Des T r a y n o r w e a r i n g h i s other hat of 18 b e i n g t h e C h a ir ma n o f A n s b a c h e r o r G u i n n e s s Mahon 19 Cayman T r u s t a s i t 20 of d ifferen t 21 G u i n n e s s Mahon Cayman T r u s t o r A n s b a c h e r ? 22 A 23 24 I didn't names. To y o u r k n o w l e d g e . 25 y o u knew n o t h i n g . 26 Ansbacher at a l l ? 27 A 28 29 had a l l But t h e y w e r e r e a l sorts either t h a t n e v e r came i n t o my w o r l d . So f a r a s y o u w e r e c o n c e r n e d , D i d y o u know a n y t h i n g a b o u t I knew n o t h i n g o f A n s b a c h e r o t h e r t h a n t h e y w e r e i n Leeson S t r e e t . 99 Q It know hi m o r s e e h im a s h a v i n g a n y t h i n g t o do w i t h A n s b a c h e r , 98 Q was known a s . 1 2 1 00 Q 3 A 4 1 01 Q 5 A 7 102 Q A 10 e v e r any d e a l i n g s 1 03 Q N o t t o my k n o w l e d g e . When y o u p a i d C o l l e g e T r u s t e e s o f f how much d i d y o u We p a i d t h e m £ 7 1 1 p e r s h a r e w h i c h came t o On t h e origin al investm ent o f £300,000; A it w asn't a I t was a v e r y r e a s o n a b l e r e t u r n . MR. MOHAN: I have a copy o f th a t 15 a g r ee m e n t f o r you 16 (E xhibit 2) . 104 Q JUDGE O'LEARY: Thank y o u , 18 that very sa tis fa c to r y , 20 m ak e s p e r f e c t 21 with i t 22 h a v e a number o f d o c u m e n t s 23 seem t o 24 explanations 25 -- 26 A lot 27 b u t some o f t h e m a r e o f r e l e v a n c e . 28 of relevance at cast page 29. A ll that I h a v e no d i f f i c u l t y Mr. M u l h e r n . But u n f o r t u n a t e l y I must p u t t o some d o u b t on i t , obviously. take T h at i s t h a n k y o u v e r y much. s e n s e t o me. all, we w i l l f r om y o u . 19 29 about bad r e t u r n ? 14 17 with £3,199,000. 12 13 had i t p a y t he m? 8 11 Or y o u r c om pa ny , Ansbacher? 6 9 None . you t h a t a n d I am l o o k i n g I w ill I for s ho w y o u E x h i b i t 3 Mr. M u l h e r n I h a v e my f o l d e r h e r e . o f t h e d o c u m e n t s a r e o f no r e l e v a n c e I am g o i n g t o at a l l Where t h e y a r e sh o w y o u t h e d o c u m e n t s . 1 2 If 3 explanation, 4 MR. MOHAN: a t a n y t i m e y ou t h i n k y o u n e e d t i m e t o I h a v e no d i f f i c u l t y Mr. 6 all 7 JUDGE O'LEARY: Chairman, t h e d o c u m e n t s and g i v e u s I think show u s I w ill one by one i f mind b e c a u s e to f i v e m inutes? No, 8 do i t you d o n ' t I have a v e r y l i m i t e d c a p a c i t y t o d e a l 10 with la r g e p ie c e s 11 MR. MOHAN: of inform ation m yself. O b v i o u s l y we h a v e n ' t 12 13 w ith th a t e it h e r . S u b j e c t t o what you s a y , 5 9 c o n s i d e r an seen them b e f o r e . JUDGE O'LEARY: There i s 14 n oth in g m agical or t r i c k y about i t , they 15 are very str a ig h tfo r w a r d . 16 Mr. 17 When Mr. 18 operating in h is p r iv a te 19 including 42, 20 o f th e head o f f i c e 21 A n sb a c h e r a c c o u n t s which had b e e n i n G u in n e ss 22 Mahon I r e l a n d w e r e m o v e d. 23 to 24 some k i n d o f 25 nothing p erson al 26 b usiness. 27 A n s b a c h e r was no l o n g e r a s u b s i d i a r y o f G u i n n e s s 28 Mahon a t t h a t 29 Ansbacher f i l e s Mulhern, Irish Could I e x p l a i n t o you, i n c a s e you d i d n ' t Traynor l e f t Guinness Fitzw illiam fa llin g & Mahon a nd s t a r t e d cap acity in other addresses S q u a r e w h i c h was t h e p l a c e o f CRH - - Intercontinental know. when h e d i d t h a t the & The b u s i n e s s was move d Ba nk. He o b v i o u s l y h ad o u t o r d i s a g r e e m e n t w i t h GMI, I t h i n k b u t h e j u s t m ov ed t h e He m ov ed t h e A n s b a c h e r b u s i n e s s b e c a u s e stage. We h a v e g o t through t h e i r & from t h e execu tives i n o n e way 1 or t h e 2 can s e e other various is documents. T h i s document you headed "Ansbacher L td." 3 4 1 05 Q. The c o n t e x t is Mr. T r a y n o r w r i t i n g t o Ronan Redmond 5 of 6 A nsbacher acco u n t was. 7 over in the 8 A n s b a c h e r on t o p o f i t . 9 people, Irish Intercontinental Irish Bank L t d w h e r e t h e T h e r e was t h i s p o t o f mone y I n t e r c o n t i n e n t a l Bank w h i c h h ad I t was owne d b y v a r i o u s maybe d o z e n s o f p e o p l e . Not hundreds but 10 certain ly 11 Mr. 12 Bank t o a c c e p t 13 H e re i n t h i s 14 1992 he i s 15 U l s t e r Bank L t d , 16 a c c o u n t o f C l a y t o n Lo ve D i s t r i b u t i o n L t d . 17 gives 18 M ulhern, 19 h a d n o t h i n g t o do w i t h A n s b a c h e r when I h a v e t h i s 20 document? 21 A. dozens o f p eo p le. Traynor would i n s t r u c t From t i m e t o t i m e Irish Intercontinental a l o d g e m e n t o r make a p a y m e n t . document (Exhibit 3) dated 30th July in s tr u c tin g the tr a n sfe r Dorset Street, t h e a c c o u n t n umbe r. why I f i n d i t Sir, 23 one s i d e 24 side 25 £ 7 5 0 ,0 0 0 by c l o s e 26 we w a n t e d t o h a v e s u f f i c i e n t 27 we w e r e t r y i n g t o do a t t h e t i m e . 28 enough cash i n t h e p o t so t h a t 29 im m ediately. o f t h e window. accept that y ou a r e s h o w i n g me t h i s I saw t h a t y ou through from a n o t h e r I a s k e d JDT t o p r o v i d e of business And i f to Mr. b u t you can p o s s i b l y also o f t h e window. to And he You c a n u n d e r s t a n d , 22 understand th a t Ir£750,000 D ublin 1 t o th e d ifficu lt I can u n d e r s t a n d t h a t , of on 3 1 s t July because f u n d s t o do a d e a l t h a t I wanted to have I could secure I am c o r r e c t , it t h a t mone y was 1 r e t u r n e d i n e i t h e r O c t o b e r o r No v e mbe r o f t h e 2 year? 3 106 Q 4 A 5 107 Q T h a t may w e l l b e t h e c a s e . 6 A I a s k e d JDT t o p r o v i d e t h e I don't know. And was n e v e r u s e d . 7 where i t 8 company's bank. 9 108 Q 10 same came f r o m . funds, I didn't He p r o v i d e d t h e L e t u s go b a c k i n t e r m s o f t i m e : a s k him funds to the When d i d y ou p a y the £3,000,000? 11 A 12 109 Q 13 A 14 1 10 Q 15 A 1993. So t h i s That's is before th a t date? righ t. So w h a t d e a l a r e we t a l k i n g I was t r y i n g about? t o buy a n o t h e r d i s t r i b u t i o n co mpa ny t o 16 a dd t o 17 t o do b u s i n e s s w i t h w e r e v e r y d i f f i c u l t 18 But t h e one t h i n g t h e y w ere i n t e r e s t e d 19 quick d e a l, 20 B u t I d i d n ' t w a nt t o h a v e t o b e l o o k i n g f o r m on e y a t 21 short n o tice so I asked 22 JDT t o p r o v i d e £ 7 5 0 , 0 0 0 , 23 1 11 Q 24 A o u r own b u s i n e s s . i n was a v e r y come t o p a s s . and n o t a b l e t o p r o v i d e it or t r i c k y . it w hich he d i d . f r om w h e r e ? N o r m a lly he w ould se n d you somewhere or t e l l g o a nd s e e 26 That i s 112 Q but the deal d id n 't But t o p r o v i d e 25 27 The p e o p l e we w e r e t r y i n g you t o s o m e b o d y and t h e t h i n g was d e a l t w i t h . w h at he u s u a l l y d i d . But d o e s n ' t that show t h a t 28 a n y j u d g e m e n t on t h i s , 29 £750,000 you - - I am n o t p a s s i n g Mr. M u l h e r n - - from A nsbacher? you borrowed 1 2 1 13 Q. 3 A. 4 5 T h a t may w e l l b e t h e c a s e . . . (INTERJECTION)? He p r o v i d e d i t that 114 Q. is who t r a n s f e r r e d I am n o t t a l k i n g 6 the tim e, 7 saying th at 8 A. 9 I n t e r c o n t i n e n t a l Bank; it I am n o t t a l k i n g 1 15 Q. 12 me t h a t , who t r a n s f e r r e d A. 14 1 1 6 Q. of knowledge a t about t h a t , as f a r as b u t I am I was c o n c e r n e d I n t e r c o n t i n e n t a l Bank. it into D i d y o u s i g n an a g r e e m e n t w i t h Intercontinental 13 our bank. t h e m o ne y came f r o m A n s b a c h e r ? You a r e t e l l i n g That i s into about your s t a t e t h e mone y came f r o m I r i s h 10 11 from I r i s h our bank. Irish Bank? No. So we c a n a c c e p t t h a t Irish I n t e r c o n t i n e n t a l Bank 15 were t h e mere i n s t r u m e n t . Who e ve r y o u owed t h e 16 m on e y t o , to 17 Intercontinental 18 A. 19 117 Q. you d i d n ' t owe i t Irish Bank? No. In o t h e r words, if 20 1 s t August 1 9 92 'Mr. M u l h e r n , 21 yesterday, who do y ou owe t h a t m on ey t o ? ' 22 A. 23 118 Q. 24 A. 25 1 1 9 Q. 26 A. 28 1 20 Q. say to y o u on you g o t £ 7 5 0 , 0 0 0 answer. You w o u l d n ' t h a v e s a i d Irish Intercontinental Bank? No. Forget Irish the p ictu r e , 27 29 JDT was t h e I was t o Intercontinental Bank, th ey are out of th e y are m erely th e in stru m en t? Yes. Th e y a r e a m e r e i n s t r u m e n t fo r the ca rry in g out of 1 2 3 Yes . 1 21 Q 4 Mr. Traynor. givin g i t 5 A 6 122 Q 7 A 8 No, it Was t h e r e in terest on t h i s o r was he as a sh areholder? was a t o t a l l y separate tra n sa ctio n . There must have b e e n i n t e r e s t on i t There w ould have b e en i n t e r e s t so? c h a r g e d on i t eventually. 9 1 23 Q 10 A What was t h e a g r e e d i n t e r e s t In t h o s e situ ation s, Sir, rate? you d o n ' t certain concern 11 y o u r s e lf with the agreed i n t e r e s t 12 d e a l i n g w i t h s o m e b o d y who y o u h a v e known f o r a l l 13 those 14 124 Q 15 A Yes, y e a r s a n d who h a s b e e n y o u r g o d f a t h e r . I understand th a t. You d o n ' t query the i n t e r e s t ; 16 robbed. What i s 17 tran saction 18 -- 19 borrowed b ecau se th e c u r r e n c ie s 20 interim . 21 that 22 what t h e 23 th is 24 quite 25 hi m a l o t 26 tim e o f payment. 27 d ishonest 28 Ir£750,000 29 Ir£750,000. is r a t e when y o u a r e -- very in te r e s tin g a nd y o u m i g h t about t h i s find th is t h a t we p a i d b a c k a l o t is y o u know y o u w o n ' t b e less m o ne y t h a n we changed in the He c o u l d h a v e a s k e d u s f o r n o t w h a t we p a i d h i m b a c k . exact piece clearly. less Ir£ 7 5 0 ,0 0 0 but I don't f i g u r e was b u t now t h a t o f paper (E xhibit 3) very strange you p r o d u ce d I reme mbe r t h e t h i n g We p a i d h i m i n S t e r l i n g than the know Ir£750,000 a n d we p a i d equivalent He c o u l d h a v e s a i d i f h e was o r n o t an u p s t a n d i n g man 'You g o t an d I w o u l d l i k e That i s y o u t o p a y me b a c k n o t w ha t h e d i d . at the 1 1 25 Q 2 A Did you t h i n k i t was c o m i n g f r o m C o l l e g e That i s n o t t h e way h e o p e r a t e d . 3 that n o t t h e way h e o p e r a t e d ; 4 from anyw here. 5 126 Q 6 7 I understand th a t. mind, A 8 9 is 127 Q as k what i t was. But h e , Mulhern, Mr. 11 Trustees ? 13 128 Q I am t r y i n g t o get inside I understand t h a t . He was t h e man who g a v e y ou you w o n d e r in g where i t 16 arrangement w ith regard to Mr. O'Leary, you where i t came f r o m o r came f r o m a nd w i t h o u t a n y in terest or repayment? you w ould have t o u n d e r s t a n d t h e 18 h i s t o r y o f my r e l a t i o n s h i p w i t h h i m . 19 o b v i o u s l y n o t making t h a t v e r y c l e a r . 20 occasions 21 transactions 22 do t h i s 23 i t .' 24 say 25 G e r r y T i e r n e y i n N o r t h e r n Bank F i n a n c e . ' 26 y o u w e n t i n t h e t h i n g was d o n e . 129 Q 28 A 29 He was B u t t h a t was a s e p a r a t e t h i n g . 15 27 your up t h e d e a l w i t h C o l l e g e £750,000 w ithout t e l l i n g A c o u l d h a v e come was C o l l e g e T r u s t e e s . 14 17 it Once he was d o i n g w h a t I w a n t e d hi m t o do I d i d n ' t t h e man who h a d s e t A I n my e x p e r i e n c e d o n ' t m i n d h i s m in d f o r t h e moment? 10 12 Trustees? Yes, A ll in other years I am On many in v o lv in g other d eals y ou w o u l d g o t o h im an d s a y or t h a t . ' He w o u l d s a y or ' I want t o ' L e t me t h i n k a b o u t Two o r t h r e e d a y s l a t e r h e w o u l d r i n g y o u and 'Go a n d s e e D a v i d Went i n C i t y B a nk . I can u n d e r s ta n d t h a t . y o u h a d t o do was s i g n . r e l a t i o n s h i p w i t h h i m. T h a t was my Go a n d s e e And when 1 1 30 Q 2 A I n e v e r a s k e d h i m w h e r e a n y t h i n g came f r o m . 3 so g l a d t h a t he c o u l d f i n d a s o l u t i o n . 4 solu tion 5 1 31 Q Mr. I was i n t e r e s t e d Mulhern, if y o u s t o p a nd t h i n k a b o u t w h at y ou have j u s t s a i d t o me. 7 very best t o b e h o n e s t w i t h me. 8 But i f 9 actu ally I know y o u a r e d o i n g y o u r I know t h a t . you s t o p and t h i n k a b o u t what you s a i d , s h o w s up t h e s t r a n g e n e s s of th is 10 You s a i d on many o t h e r o c c a s i o n s 11 for 12 a d a y o r t wo and t h e n h e w o u l d s a y 13 o th er banker' 14 a r r a n g e m e n t s m ade . 15 o t h e r b a n k e r you s i g n e d a d o cu m en t, 16 note. 17 m on e y and y o u w e r e g o i n g t o p a y i t 18 was an i n t e r e s t 19 different A some a r r a n g e m e n t . in terest rates 23 reme mbe r w h a t t h e rate were. interest I d o n ' t w a nt t o 26 paying the current 28 1 33 Q 29 A the You w e r e g e t t i n g is b a c k and t h e r e an e n t i r e l y current One knew w h a t i n t e r e s t You a r e a s k i n g me now. it If This at the tim e. t o me t h a t A some a prom issory r a t e would have been th e 25 27 'Go a n d s e e for situation? 22 No, y o u w o u l d a s k hi m He w o u l d t h i n k a b o u t i t som ething. rate. in terest 132 Q deal. But when y o u w e n t i n t o You s i g n e d But t h e it an d h e w o u l d h a v e t h e n e c e s s a r y 21 24 I t was t h e in. 6 20 I was I cannot rate was. know a n um be r . Ar e y o u s a y i n g was y o u r u n d e r s t a n d i n g t h a t interest y ou w e r e rate? y o u wa nt t o b o r r o w m on e y y o u h a v e t o p a y f o r i t . Did you pay i n t e r e s t on i t ? I am s u r e t h e r e was i n t e r e s t 27 at the repayment 1 2 I wonder would you t h e r e f o r e 3 organisation 4 it 5 which t h i s 6 s e n t b a c k o u t and t o whom i t 7 sent 8 A 9 1 35 Q yourself it get some p e r s o n i n y o u r in a resp o n sib le p o s it io n if you l i k e -- to in dicate mone y was r e c e i v e d i n , A bsolutely. piece t h e d a t e on was p a i d . to? o f p a p e r I am g o i n g t o give 11 some o t h e r p i e c e s 12 in fo r m a tio n about o th e r p e o p le . 13 elim inate 14 Rest assured th a t 15 yourself, 16 important th a t 17 anxious to 18 it 19 made o u t t o ? 20 u s we c a n t h e n c h e c k w i t h t h e a p p r o p r i a t e 21 institu tion ? 22 A 23 136 Q 24 you can keep i t . A 26 137 Q We may h a v e t o a n y th in g which i s you keep i t . know i s , r e le v a n t to inform ation. That i s It is What I am p a r t i c u l a r l y when y o u made t h a t by bank d r a f t , you rself. by cash? som ething, r e p a y m e n t was Who was i t which i f you t e l l fin an cial Yes . B e c a u s e t h a t may g i v e u s some i d e a o f w h a t was i n stage. Yes . I am s u r e y o u a r e d o i n g y o u r v e r y b e s t mo me nt . 28 happened in But i f 1 9 92 on o f p a p e r t h e r e may b e o t h e r y ou c a n k e e p t h a t 27 29 I t may w e l l b e t h a t some i n f o r m a t i o n n o t r e l e v a n t t o y o u r m i nd a t t h a t 25 was o f paper? Every p i e c e by cheque, it When y o u 10 you, y ou c a n do the date b a c k o u t who d i d y o u p a y i t Can I k e e p t h i s -- s o m e b o d y a s k e d me t o at the s a y wha t I m i g h t n o t b e 100% s u r e e i t h e r . 1 see 2 out of th a t 3 a Sterlin g 4 d ifferen tial 5 correspondend to the 6 available 7 A 8 138 Q 9 there that t h e r e a p p e a r s t o have b e e n a payment account of £703,000 account -- and t h a t on 3 1 s t is -- I suspect that why t h e r e is is a J u l y 1992 w h i c h a p p e a r s t o I r £ 7 5 0 , 0 0 0 w h i c h was made t o y o u r company? Yes . You c a n s e e t h a t it came o u t o f Cayman I n t e r n a t i o n a l & Bank & T r u s t Company L t d ? 10 A 11 139 Q Yes . You c a n s e e t h a t was a t o t a l 12 account in 13 Intern ation al 14 £10,000,000. 15 you. 16 you s e e t h e p o s i t i o n 17 n o t on e x a c t l y t h e 18 date 19 sum o f m o ne y . 20 n o t e d as S9. 21 c o r n e r S9? 22 A 23 1 40 Q 24 A 25 1 41 Q Irish account. I n t e r c o n t i n e n t a l Bank o f Cayman at th at stage, w h i c h was some He p a i d I r £ 7 5 0 , 0 0 0 I f y o u l o o k now a t E x h i b i t it T h a t was t h e there. same d a t e , was r e p a i d . out of th a t 5 -- This but i t m ig h t be t h e see that that And y o u s e e it is c o m i n g f r o m S7 t o is Yes . T h e r e was an i n t e r n a l t r a n s a c t i o n . I t w ould ap p ea r S9, 27 a nd was s u b s e q u e n t l y t r a n s f e r r e d t o S7? 142 Q account same S9? t h e m on e y was l o d g e d b a c k i n t o 29 the Yes . that A is Do y o u s e e up on t h e t o p r i g h t - h a n d 26 28 p a g e 31 - ­ shows £ 7 0 3 , 0 0 0 C oin cid en tally i t You w i l l for the £703,500 Yes . One o f t h e m a t t e r s we h a v e t o consider of course is 1 2 Yes . 3 1 43 Q 4 A What do y o u h a v e t o say about th a t? There a r e seven people in t h is ro o m. 5 there seven people in t h is room I h a d n o t h i n g t o 6 do w i t h S7 o r S 9 . 7 that 8 is 9 144 Q are It is v e r y i m p o r t a n t t o me, you u n d e r s t a n d t h a t . fact. Of c o u r s e , As s u r e a s And i f I say th a t, And t h e r e i s no c o l o u r on t h e Mr. it Mulhern, is not r ig h t to y o u h a d n o t h i n g t o do w i t h i t . 11 been yours; 12 But i t 13 c ompany d i d a t an a p p r o p r i a t e t i m e , 14 h a r d l y s a y y o u h a d n o t h i n g t o do w i t h i t ? 15 A 16 17 is You made t h e together. or your so you can S7 o r S9 m i g h t h a v e been mine. 1 45 Q 18 I am s a y i n g t h a t is a p o ssib ility we h a v e t o con sid er. 19 A 20 146 Q I didn't own a n y p a r t , penny worth o f t h a t . I n f a c t Ms. Ma c ke y m e n t i o n s t o me t h a t 21 b r in g your a t t e n t i o n 22 E xhibit 23 headed paper. 24 in stru ction 25 Do y o u know who DPC i s ? 26 you g o t £ 7 0 3 , 0 0 0 suggestion that say th at I t may n o t h a v e a d if f e r e n t m atter a l l does appear th a t that fact. 10 that Sir, A 3 -- for the p a g e 29 - - sake o f co m p leten ess to which i s You w i l l I should th e Ansbacher see that there t h e r e t o DPC f r o m Mr. is an Traynor. No. 27 Mr. 28 In o t h e r words, 29 S9. Padraig C o lle r y . It says: "Please d e b it S9." t h e £ 7 5 0 , 0 0 0 w h i c h y o u g o t came f r om Mr. M u l h e r n , if you w i l l p l e a s e look at 1 2 Mr. 3 t h a t t h e A n s b a c h e r a c c o u n t s w e r e c h a n g e d i n name 4 from A n sb a c h e r t o H am ilto n Ross d u r i n g t h a t p e r i o d 5 of tim e. 6 accounts 7 H am ilton Ross n o te p a p e r w it h t h e Ansbacher 8 notepaper, 9 s a me , Mulhern, i n c a s e you d o n ' t know y o u r s e l f a l r e a d y But t h e r e w e r e no o t h e r c h a n g e s o f any k in d . you w i l l In f a c t see that if you compare t h e th ey are e x a c t ly the t e l e p h o n e n umb er s a nd e v e r y t h i n g , in a ll 10 p articu larities. 11 c o n v e n i e n c e b y w h i c h A n s b a c h e r was l a t e r 12 It is 13 it that 14 Ansbacher. a different in the H a m i l t o n R o s s was a m e r e f l a g of known. c o r p o r a t e e n t i t y b u t you can t a k e e v e r y t h i n g H am ilton Ross had o r i g i n a t e d in 15 16 E xhibit 17 Irish 18 D istribution 19 transaction? 20 A 21 148 Q 22 6 is S t g £ 1 .3 m s e n t by H am ilton Ross t h r o u g h I n t e r c o n t i n e n t a l Bank t o C l a y t o n Lo ve I d o n 't but This i s Ltd. Do y o u reme mbe r t h a t I am s u r e i t is 2 7 t h J u l y 1 9 9 3 - how d o e s t h a t tim e to th e purchase o f th e 23 A 24 149 Q 25 A 26 1 50 Q 27 It is tenable. relate in shares? c o m i n g up t o t h a t p e r i o d . When do y o u t h i n k t h e p u r c h a s e was? 29th October. But p r e s u m a b l y i t was a g r e e d s o m e t i m e p r e v i o u s to that? 28 A 29 1 51 Q It h a d b e e n g o i n g on f o r some t i m e . You w e r e h o l d i n g an e x t r a o r d i n a r y g e n e r a l m e e t i n g on 31 1 2 9 t h O c t o b e r and i t 2 This i s 3 Mr. 4 It 5 152 Q 6 7 8 9 an e x t r a o r d i n a r i l y Your company a p p a r e n t l y g o t with t h i s but I am s u r e we c a n clea r explanation. appreciate, in resp ect a nd i n r e s p e c t 11 your r e c o r d s w ith r e ga r d t o 12 payment o f i t 13 of i t 14 conclusion. 15 exercise 16 a nd A n s b a c h e r t o b e o n e a nd t h e 17 purpose. 18 distin ction s 19 or n o t p e o p l e were c l i e n t s 20 stage, 21 R o s s a nd A n s b a c h e r . 22 t h i n k o r was i t 23 a year la te r ? A 25 154 Q 26 A That's is shares. get £1,300,000? I am n o t au f a i t As y o u w i l l 31,300,000 10 24 sum o f mo ne y, is . provide a p e r f e c t l y 1 53 Q large Mulhern? For w ha t d i d i t A c o u l d n ' t be done b e f o r e t h a t . of th is back, im portant if of the last documentary e v id e n c e it its receipt was p a i d , it f r om a nd t h e or t h e purpose s o t h a t we c a n come t o You c a n t a k e one a for the purpose o f the t h a t we w i l l b e c o n s i d e r i n g H a m i l t o n R o s s Just but for th is same e n t i t y purpose. for th is T he y h a v e o t h e r fo r th e purpose o f d e c id in g whether o f Ansbacher at th a t t h e r e was no d i s t i n c t i o n betw een Hamilton Was t h e r e a s e c o n d d e a l do y o u a d i f f e r e n t purpose because t h i s is right. Was t h e r e a s e c o n d p r o p o s e d d e a l ? I am n o t sure about t h i s one. T h a t o n e I am s u r e 27 about b ecau se 28 £672,000 29 we a c t u a l l y made m one y on b o r r o w i n g t h o s e I remember a t t h e t i m e we p a i d b a c k or £ 6 7 0 ,0 0 0 odd r a t h e r t h a n I r £ 7 5 0 , 0 0 0 , funds. so 1 T h a t s t u c k i n my m i n d ; 2 one. 3 w i l l be a b l e t o 4 1 55 Q T h is one I d o n ' t itself 6 Mr. A 8 156 Q 9 explain is why I reme mbe r t h a t re me mb e r b u t I am s u r e we it. The e x t r a o r d i n a r y t h i n g a b o u t i t 5 7 that is is, even th a t extraord in ary because everybody says th at T r a y n o r was v e r y f a i r man? Yes . E v e r y b o d y who c o m es i n h e r e s a y s t h a t . The y a l s o s a y he was a v e r y e f f i c i e n t man a nd t h a t he l o o k e d 10 a f t e r p e o p l e ' s m on e y w i t h e x t r e m e d i l i g e n c e . 11 o th e r words, 12 do i t 13 o f m o ne y . 14 you a r e n o d d in g your head? 15 A 16 157 Q if y ou g a v e Mr. in p er fe c t safety, As y o u now a p p r e c i a t e 18 h i s b y r e a s o n o f Mr. 19 l o w e r sum o f money? a sizab le He d i d n ' t , 22 m eantim e. Traynor a g r e e i n g t o In o t h e r words, was accept a same S t e r l i n g v a l u e t h a t t h e c u r r e n c y had c h an ge d i n t h e the currency p r o f it 24 That would seem t o 25 to his 26 p e o p l e ' s m o ne y o r a l t e r n a t i v e l y t h a t 27 d iffe r e n c e because 28 place? 29 you ou t t h e p e r s o n w h o s e m o ne y i t he a c c e p t e d t h e he s t a r t e d w i t h ; 158 Q fidd le sum o f m on e y w h i c h w o u l d r i g h t l y b e 21 23 he w o u l d n ' t A b solu tely. lost A T r a y n o r m one y y o u c o u l d I t h i n k y ou s h a r e t h a t v i e w f r o m t h e way 17 20 In suggest was y o u r s . t h a t he w a s n ' t l i v i n g up normal h i g h s t a n d a r d s o f l o o k i n g a f t e r it it made l i t t l e was y o u r m o ne y i n t h e first 1 159 Q 2 A 3 1 60 Q 4 5 The a n s w e r i s no. You s e e w ha t I am s a y i n g , character that A that it is he w o u l d do t h a t t o out of an i n v e s t o r ? He e a r n e d t h e interest, 6 happened t h a t t h e b a l l b o u n c e d t h e r i g h t way a s 7 a s we w e r e c o n c e r n e d i n t h a t p e r i o d . 8 1 61 Q 9 w hatever t h a t was. I u n d e r s t a n d w h a t y o u m ea n. E xhibit 7 -- page 34. I w ill This is 10 withdrawal 11 H am ilton Ross a c c o u n t . 12 account even though i t 13 a c c o u n t as t h e o t h e r one b u t i t 14 £4,000,000. 15 withdrawn. 16 A 17 162 Q from I r i s h It is is just far s ho w you actual I n t e r c o n t i n e n t a l Bank, the now a H a m i l t o n R o s s p r e c is e ly the You c a n s e e t h a t You w i l l the It is same t y p e o f now down t o the £1,3 0 0 ,0 0 0 is come b a c k t o u s on t h a t ? I certain ly w ill. I w ill show y o u now E x h i b i t 7 -- page 36. 18 The r e m a i n d e r o f t h a t d o c u m e n t r e l a t e s to 19 people s ho w i t 20 you. 21 the o r ig in a l 22 showing i t 23 MR. MOHAN: That w o n 't be n e c e s s a r y . JUDGE O'LEARY: I have i t 24 1 63 Q and i t But i f w ould be u n f a i r o f us t o other your p r o f e s s i o n a l a d v is e r s wish to document t h e r e no d i f f i c u l t y is to see in t o t he m? 25 me; 26 have a lo o k at 27 into 28 people. 29 account. it. This is is front of a n y o n e c a n come up and I p r e f e r however not t o g i v e your p o s s e s s i o n This here in so as n ot t o i d e n t i f y it other G u i n n e s s Mahon J e r s e y T r u s t way b a c k i n 1974. You s e e down 1 2 3 164 Q. 4 5 A. 6 1 65 Q. That seems t o have b e e n p a i d r e John Mulhern settlem ent. What c a n y o u t e l l It 1 97 4 s o I w o u l d n ' t b e g o o d a t t h a t . is Mr. £500 i n Mulhern, us a b ou t t h a t ? y o u a r e an i n t e l l i g e n t man. 7 very w ell that 8 It "re John Mulhern s e t t l e m e n t " 9 in terested 10 A. 11 1 6 6 Q. 12 A. 13 14 15 in, Th e y d i d n ' t No, I cannot is. A. 17 168 Q. 18 A. 19 1 6 9 Q. 20 A. 21 1 70 Q. 22 A. 23 I am n ot th e £500? is. i m a g i n e what i t is. I don't You a r e a s k i n g me a nd I d o n ' t Did you have a s e t t l e m e n t or a t r u s t know wha t know. in Jersey at time? I d on 't th in k so. Irrespective o f w h e th e r you u s e d i t or not? I d on 't th in k so. It is an u n u s u a l name " John M u l h e r n ? " A bsolutely. Can y o u g i v e me a n y e x p l a n a t i o n ? That i s an o l d G u i n n e s s recognise 1 71 Q. that im agine i t ? around at t h a t 16 24 the care about th e £500. I c a n n o t i m a g i n e w ha t i t it 167 Q. is I don't You know the & Mahon s t a t e m e n t ; statem ent. You c a n s e e t h a t t h e y h a d an a c c o u n t c a l l e d 25 G u i n n e s s Mahon J e r s e y T r u s t L t d . 26 that 27 estab lish ed tru sts 28 is 29 professional all the I would other tr a n sa ctio n s why I w o n ' t You c a n t a k e are it f r o m p e o p l e who o f o n e k i n d o r a n o t h e r and t h a t s ho w y o u t h e n a m e s . advisors Your can l o o k a t them w i t h o u t any 1 d ifficu lty . 2 s e t t l e m e n t ." 3 A. 4 5 I couldn't I n t h a t we s e e tell yo u w h at i t "re John Mulhern is. I w o u ld n 't have a clue . 172 Q. I u n d e r s t a n d you c o u l d n ' t 6 do y o u know w h a t i t 7 d i f f e r e n t m atter? 8 A. 9 1 73 Q. No, It if is is? tell me w h a t i t That i s I knew I w o u l d t e l l not n e c e s s a r i l y the you. same t h i n g . When y ou p ractice 11 you t h i n g s 12 n o t mean t h a t h e d o e s n ' t know, 13 'I You u n d e r s t a n d ? 14 A. 15 174 Q. 16 couldn't A. 18 1 75 Q. 19 A. 20 1 7 6 Q. tell couldn't you.' So y o u w i l l b it That i s f o r g i v e me i f a ll I do b u t I c a n n o t t e l l You d o n ' t know i s you. m erely says t h e Channel 24 settlem ent use the Not t h a t I don't know. a b e t t e r way o f p u t t i n g i t . 23 fa cilities Islands Did you a t a l a t e r i n J e r s e y or Guernsey or o r t h e Cayman I s l a n d s for a o f some k i n d ? I c a n r e m e mb er . 26 JDT d i d i t 27 r eme mbe r s p e c i f i c a l l y . 29 does You u n d e r s t a n d t h e d i f f e r e n c e ? stage 177 Q. it that right. 22 28 you t h a t ' on t h a t m a t t e r ? T h a t was way b a c k i n 1 9 7 4 . A. tell say to I h a v e t o p u r s u e you a 21 25 I do a nd p e o p l e I do. little 17 law i n Kerry l i k e 'I but a sligh tly 10 lik e is, t h a t way, The e s t a b l i s h m e n t But i t I don't know. of a settlem ent is p ossib le I cannot or t r u s t or that 1 2 A. 3 178 Q. 4 5 A. You w o u l d . It is n o t a t h i n g we do e v e r y d a y o f t h e w e e k . It is a b it What i s unusual? v ery unusual about i t 6 was l i v i n g 7 I c a n n o t h e l p you b u t I w i l l 8 sense 9 b usiness 10 1 7 9 Q. in a b e d s itte r on i t . That i s off As y o u w i l l 12 appropriate? 14 1 80 Q. 15 A. 16 1 81 Q. 17 A. 18 182 Q. I n 19 74 down t h e r o a d f r o m h e r e . see i f I c a n p u t some a b it o f forward prudent Traynor m ight have been c o n s id e r e d I t might have been. Did you e v e r u s e su ch a t r u s t later? N o t t o my k n o w l e d g e . A settlem ent? N o t t o my k n o w l e d g e . What s e c u r i t y do y o u reme mbe r d i d y o u g i v e for the 19 b o r r o w in g a t t h e tim e you b o u g h t o u t t h e C l a y t o n 20 Love f a m i l y ? 21 A. 22 1 83 Q. 23 A ll the shares A. 25 184 Q. i n t h e c o m pa ny . D i d y o u h a v e a co mpany w i t h w h i c h y o u w e r e associated 24 called I c e c r e a m M a r k e t i n g L t d? Correct. How d i d t h a t fit into the general 26 I have seen th e r e t u r n s 27 I am n o t i n t e r e s t e d 28 29 A. I t wo y e a r s a f t e r we b o u g h t t h e appreciate, p l a n n i n g b y Mr. A. 1974. C la y to n Love. 11 13 is and t h a t structure? sort of thing. in that? I t was s u b s i d i a r y o f C l a y t o n Lo ve D i s t r i b u t i o n t h a t we s e t up t o h a n d l e t h e i m p o r t a t i o n and Ltd 1 d istrib u tion 2 1 85 Q 3 A 4 186 Q 5 6 A 7 187 Q So i t o f Ly on sma de I c e c r e a m i n t h i s was a s u b s i d i a r y o f y o u r s ? Yes . Was i t used u lt im a t e ly in the Did i t h a v e some i n v o l v e m e n t I don't think i t 9 deposit? 11 12 I wouldn't th in k successful 188 Q calls 14 E xhibit 15 Ltd. " A 17 189 Q or in B e l f a s t so b e c a u s e c om pa ny , all that reply in to 8 -- page 48. The f i r s t 19 down i n r e s p e c t 20 " suitably 22 1 90 Q o r Lo ndo n on w asn't a very h a d was l o s s e s . d o c u m e n t f r o m GMI w h i c h question. You s e e I w ill o f the This i s you an You c a n s e e t h a t t h e y h a v e first o f t h e two l o a n s secured." Yes . We h a v e r e c e i v e d sworn e v i d e n c e f r o m GMI - - 23 in d eed th e M oriarty Tribunal r e c e iv e d 24 evidence 25 t h a t t h e r e was a b a c k i n g d e p o s i t 26 loan. 27 w h i c h c a s e we a r e n o t t h e slig h test 28 in i t it 29 give "Icecream Marketing o f t h e t wo o f t h e m t h e r e . i n t e r n a l GMI d o c u m e n t . A Did t h a t Yes . 18 21 it it I n 1 9 7 5 we h a v e an i n t e r n a l 13 16 in that? I p r o b a b l y p i c k e d t h a t up i n c o r r e c t l y . h a v e mone y o f f s h o r e A sh a re p u rch a se scheme. had. 8 10 country. -- that and sim ilar sworn t h e term " s u i t a b l y s e c u r e d " meant in r e sp e c t o f the I t may n o t h a v e b e e n i n Cayman o f c o u r s e , except to elim inate b it in terested f r om o u r e n q u i r i e s . in 1 Cayman, 2 other 3 Ireland. 4 Cayman. 5 I couldn't 6 1 91 Q 7 A 8 192 Q 9 A 11 1 93 Q 12 A 13 194 Q 14 su b sid iaries, eith er or i n one o f t h e B ritain O verw helm ingly in t h e Channel I s l a n d s What m one y was b a c k i n g t h a t tell you, A 16 1 95 Q loan? Sir. O bviously, D i d Mr. but I don't know. Traynor e v e r s a y t o you l o a n w i t h some c a s h t h a t 'I am g o i n g t o b a c k I have?' N o t t o my r e c o l l e c t i o n . Did t h e co mpany e v e r h a v e m o ne y i t s e l f In 1975 I c a n n o t You c a n t a k e it i m a g i n e w ha t i t that su itab ly offshore? was. s e c u r e d has o n ly th a t You a r e t e l l i n g If me t h a t an d I h a v e t o w i l l be e n t i t l e d 18 am t e l l i n g 19 that 20 on o a t h a t t h e M o r i a r t y T r i b u n a l . 21 to 22 explanation? A is you t h a t is there I w ill is certain ly 25 n o w . . . (INTERJECTION). 28 A 29 197 Q Yes . But I w h a t h e s w o r e on o a t h and swore So I am p u t t i n g look in to on i t , it and s e e but as o f A re y o u f a m i l i a r w i t h a co mpany c a l l e d Clarkwood H o ld i n g s ? you som ething th a t needs can throw any l i g h t 27 i n due c o u r s e . w ha t a n o t h e r member o f t h e b a n k a l s o you t h a t Yes. t o do t h a t 24 196 Q accept th at. y o u w a n t t o q u e s t i o n t h e man f r o m t h e b a n k , 17 26 or m eaning? 15 23 or t h e North o f T h e r e m u s t h a v e b e e n some m o ne y b a c k i n g i t ? that 10 i n t h e Channel I s l a n d s if I 1 A. 2 I t was a co mpa ny t h a t I owne d a n d p u t some p u r c h a s e s through. 3 198 Q. 4 A. 5 1 9 9 Q. 6 Was i t part of the No, was t o do w i t h h o r s e s . it A. 8 2 0 0 Q. 9 A. 10 2 0 1 Q. 11 A. 12 202 Q. 13 A. 14 2 0 3 Q. 15 A. 16 204 Q. 17 food s itu a tio n ? You b o u g h t a nd s o l d h o r s e s that 7 frozen through t h a t Who w e r e t h e certain ly. shareholders o f t h e company? Me. E ffectively yourself? Yes. Was Mr. Traynor in v o lv e d in t h a t company? No. Had h e a n y i n v o l v e m e n t a t a l l ? No. Do y o u know w h e t h e r he e v e r p r o v i d e d a s e r v i c e A. 19 2 0 5 Q. 20 A. 21 2 0 6 Q. 22 A. I t may s t i l l be i n e x i s t e n c e but i t 23 207 Q. When d i d i t s trading 24 A. 25 208 Q. 26 A. 29 No. Where d i d t h e I think i t s Is it Late co mpa ny b a nk ? o n l y b an k ers were G uinness & Mahon. t r a d i n g now? start is not tra d in g . approxim ately? 1 9 7 0 ' s m a y be . When d i d i t s t o p t r a d i n g d i d you say? I would sa y th e last set o f a c c o u n t s t h a t went i n w o u ld h a v e b e e n 1998 or 1 9 9 9 . 2 0 9 Q. for company? 18 28 is correct? I bought h o rses the 27 c om pa ny , I w ill show y o u now E x h i b i t 9 -- page 50. 1 The p r o b l e m , 2 t h a t t h e r e was some c o n n e c t i o n b e t w e e n A n s b a c h e r and 3 Clarkwood H o l d i n g s . 4 Guinness 5 t o Clarkwood H o l d i n g s . 6 p u r ch a se o f a h o r se or t h e 7 A 8 211 Q 9 Mr. Mulhern, is t h a t t o me i t me ans Why w o u l d A n s b a c h e r o r & Mahon h a v e b e e n m a k i n g a p a y m e n t o f £ 45 I t was h a r d l y f o r t h e sale of a horse either? I cannot im agine. You t o l d me t h a t Mr. T r a y n o r h a d n o t h i n g t o do w i t h it? 10 A 11 212 Q 12 N othing. At t h i s s t a g e Mr. T r a y n o r h a d now l e f t Guinness & Mahon? 13 A 14 213 Q Yes . He was no l o n g e r o p e r a t i n g a s E x e c u t i v e 15 & Mahon. 16 u sin g other note paper. 17 c o n t i n u e d t o u s e i n t e r n a l memos b e c a u s e 18 kind o f r e l a t i o n s h i p . 19 on i t 20 Ansbacher n ote paper, 21 Square. 22 You c a n s e e t h a t in in Guinness f a c t t h a t h e was e v e n I n t h e v e r y e a r l y d a y s he it was t h a t But o b v i o u s l y a s t i m e w e n t b e c a m e mo re f o r m a l a n d h e w r o t e t o t h e m w i t h a rep ly to 42, F itzw illiam He w r o t e t o Mr H um p h r i e s a n d s a i d : "Dear D a v i d , C o u l d y ou p l e a s e a r r a n g e t o l e t me h a v e for c o lle c t io n n a s t e r lin g d raft for S tg£45,00. D ebit th e c o s t to Ansbacher U n i t e d a c c o u n t . . . ." 23 24 25 26 A Yes . 27 Your co mpa ny a p p e a r s t o h a v e g o t £ 4 5 S t e r l i n g 28 Ansbacher? 29 f r om 1 2 I am t a k i n g t h e s e 3 t he m h e r e . I f y o u now l o o k a t E x h i b i t 4 61 a nd 6 3 . Mr. M u l h e r n , 5 a schedule. 6 relates 7 p e o p l e who h a d l o a n s w i t h G u i n n e s s 8 su itab ly 9 A 10 216 Q documents in th e order which I g e t I have here secured? Yes . I have e x t r a c t e d f r om t h o s e t h e o n e s r e l e v a n t 12 " I ce c r ea m M a r k e tin g Ltd - £ 4 0 , 0 0 0 . " 13 This i s 14 w ith 3 1 st October 1974. 15 3 1 s t O c t o b e r 1 97 4 16 £40,000 17 somewhere. 18 funds were l o c a t e d t h a t backed i t ? 20 217 Q 61 y o u w i l l a nd i t It is s a y i n g t h a t on was b a c k e d b y e x t e r n a l funds I am a s k i n g y o u w h e r e t h e tell you, external Sir. 63 o f E x h i b i t 10 y o u w i l l that 22 b y I c e c r e a m M a r k e t i n g L t d w h i c h was s e c u r e d 23 acco rd in g to Guinness 24 funds. 25 were t h a t A see I c e c r e a m M a r k e t i n g L t d owed you l o o k a t pa g e in to a s c h e d u l e p r e p a r e d b y GMI f o r u s d e a l i n g I couldn't If I f you l o o k a t page 21 26 o f the & Mahon t h a t w e r e y o u r c o mp a n y. A e x t r a c t which T h e s e a r e t h e names o f a l l 11 19 pages four pages of You a r e o n l y g e t t i n g t h e to you. 10 - - 1 9 78 see f r o m t h e same s o u r c e £ 8 0 , 0 0 0 was owed & Mahon i n r e s p e c t I am a s k i n g y ou w h e r e t h o s e are backing th a t I am s a y i n g t o y o u t h a t of external external £80,000? I couldn't t e l l you. 27 I don't 28 Do y o u know a n y t h i n g a b o u t a compa ny c a l l e d 29 Debon A r a b i a C o n t r a c t s L t d? know. funds 1 2 219 Q 3 A It is a co mpa ny t h a t 4 I don't a c tu a lly 5 set 6 220 Q 7 A 8 221 Q 9 When was i t S o m e t i m e a n y wa y a g o o d f e w y e a r s b e f o r e h e d i e d . If you a r e w ith th o se. That i s I t was t h e r e f o r e Was i t a n y t h i n g do w i t h t h o s e I don't think i t t h e y a r e v e r y much l a t e r ; 16 altogether. 17 quite 18 other q uestions 19 its 20 you were t h e 21 Debon A r a b i a C o n t r a c t s L t d? that is because to ta lly I am n o t a s k i n g y o u t h a t . a separate question, own r i g h t . I don't h a d a n y t h i n g t o do n o t w ha t I am a s k i n g y o u a t a l l 15 A a few y e a r s y o u r company? s a y i n g has i t 13 22 was 1990 or 1 991 . item s th ere, 222 Q but i t established? b e f o r e he d i e d . A u p. up b y hi m s u p p o s e d l y i n G u e r n s e y o r J e r s e y . 12 14 know t h e p u r p o s e o f i t He d i e d i n May 1 9 9 4 . 10 11 Desmond T r a y n o r s e t This i s Could you t e l l know t h a t . This i s n o t h i n g t o do w i t h a n y I asked you. legal differen t a question in me w h e t h e r o r n o t or b e n e f i c i a l owner o f I t was a co mpa ny t h a t was 23 available 24 it 25 I t was an o f f s h o r e v e h i c l e estab lish ed 26 if There i s 27 w ith th a t. 28 that. 29 in t o be used i f we r e q u i r e d i t . That i s as was. you w anted t o u s e i t . I am n o t c r i t i c i s i n g But i t fa c t use it ? was a v a i l a b l e f o r your use n o t h i n g w r ong y o u i n a n y way f o r to you. And d i d y o u 1 I am n o t s u r e w h e t h e r we d i d . 2 e ver put a t r a n s a c t i o n through i t . 3 224 Q 4 A Was i t your i n t e n t i o n a t I think i t was o r i g i n a l l y 5 existed D eloitte 6 one o f t h e two. 7 225 Q in But i n s o f a r a s i t 8 w ere aware i t 9 that 10 A 11 12 226 Q some s t a g e a sh elf we to use i t ? c ompa ny t h a t & Touche or i n G u in n e ss was u s e d a t a l l , & Mahon, s o f a r a s y ou was a v e r y p e r i p h e r a l involvem ent, is correct? I t was j u s t a fa cility t h a t was t h e r e r eq u ir e d as I understood i t . Did you pay f o r t h e c o s t if of estab lish in g it was th is c omp a ny do y o u t h i n k ? 13 14 A 15 227 Q 16 A 17 228 Q 18 A 19 229 Q I don't know. C o u l d y ou c h e c k t h a t D - E - B - O - N A r a b i a C o n t r a c t s L t d? A re y o u t h i n k i n g t h a t £ 4 5 i s I am n o t t h i n k i n g a t a l l a ctu ally. 21 that. 22 date 23 A 24 230 Q f o r me? Yes . 20 what t h a t m i g h t be ? a t t h e mo me nt . I am n o t T h a t £ 4 5 may h a v e n o t h i n g t o do w i t h I t may h a v e , I don't know. What was t h e of it? 1990 . Maybe i t was, I don't 25 unlikely. 26 c omp a ny f o r £ 4 5 . 27 do y o u know? 28 I don't think so. 29 I don't b e lie v e know. I think i t is I d o n ' t t h i n k you w ould e s t a b l i s h Did i t any e v e r have a bank a c c o u n t , I t may h a v e h a d . 1 231 Q If I m e n t i o n AIB C h a n n e l I s l a n d s 2 the p o s s ib le p lace 3 you have s a i d ? 4 A 5 232 Q 6 A It could be. 7 233 Q If I was t o It it in J e r s e y as b e in g had a bank a c c o u n t what w ould could have. That would be one o f t h e p l a c e s s a y t o you t h a t that it a sum o f £ 1 , 7 0 0 , 1 7 8 . 7 5 8 was t r a n s f e r r e d t o t h a t b a n k a c c o u n t i n 9 1994, 10 A 11 234 Q Mulhern, is p ossib le, p a y m e n t s now w h i c h y o u c e r t a i n l y 13 e x p e c t e d t o r e m e m b e r. 14 d iverse 15 £1,7 0 0 ,0 0 0 A 17 235 Q interests I can c e r t a i n l y check i t I understand th a t The q u e s t i o n 21 236 Q 22 25 26 27 28 29 Sir. if up a n d we w o u l d you can c h e c k i t u p. do y o u re me mb e r i t ? I d o n ' t re me mbe r i t . Would y o u s ho w Mr. M u l h e r n E x h i b i t I am g o i n g t o 11 - - page 79. a d j o u r n now f o r a b o u t t e n m i n u t e s . 23 24 u p, Jersey? you can c h e c k i t 19 is, c o u l d n ' t be But e v e n a man o f y o u r was t r a n s f e r r e d t o g r ea tly appreciate A I am n o t s u r e . w o u l d re me mb e r w h e t h e r o r n o t 18 20 Sir, I t h i n k we a r e g o n e away f r o m £ 45 12 16 February w h a t w o u l d y o u s a y t o me? I n F e b r u a r y 1 99 4 i t Mr. c o u ld have? SHORT ADJOURNMENT 1 2 C ha i r ma n - - I have j u s t 3 h a d an o p p o r t u n i t y t o g o t h r o u g h some t h i n g s . 4 It 5 u po n w h a t t h e p e r c e i v e d t e r m s o f r e f e r e n c e w e r e and 6 how i t 7 a series 8 1973/1974 9 that does a p p e a r t h a t we p r e p a r e d a s t a t e m e n t b a s e d a f f e c t e d Mr. M u l h e r n . Now y o u h a v e g i v e n u s o f documents which d a te up t o en tails. 1993/1994, from as which i s a gap w i t h a l l I m u s t s a y I am q u i t e concerned 10 a b o u t t h e way t h e q u e s t i o n i n g h a s g o n e . 11 do I w a nt t o 12 th is 13 r e p l y c o m es t h a t my c l i e n t 14 to h elp or d o e s n 't 15 o f an i m p l i e d c r i t i c i s m 16 when I h a d a s k e d a t t h e o u t s e t 17 o f th e documents, 18 p osition 19 docum ents. 20 JUDGE O'LEARY: appear t o be c r i t i c a l regard. to But i t know, o f you, in when t h e unaware or i s unable a n a t u r a l enough r e a c t i o n in th at regard. And h e n c e c o u l d we h a v e s i g h t assist you i n r e l a t i o n to Mr. Mohan, all that of those is of course c o rrect. 22 Of c o u r s e y o u w o u l d b e b u t p a r t o f t h e 23 process 24 put th a t to p eo p le. 25 assessin g 26 w hich a r e p u t t o them. 27 MR. MOHAN: 29 Sir, we w o u l d b e i n a much b e t t e r 21 28 I n no way does appear t o be, is fa r back as is t h a t we g e t i n f o r m a t i o n the in vestigatin g f r o m p e o p l e and P a r t o f our a s s e s s m e n t i s r e a c t i o n o f a p e r s o n t o documents But w i t h t h e greatest 1 2 I r e p e a t e d t i m e and t i m e 3 a g a i n t h a t Mr. 4 a ll 5 Ansbacher b u s in e s s 6 That i s 7 MR. MOHAN: Mulhern i s n ' t I am t r y i n g to fin d out i s 10 I appreciate that. But y o u s a y h e i s not accused of anything. JUDGE O'LEARY: He i s not accused of anything. MR. MOHAN: I know t h a t b u t 13 so m etim e s you m igh t be 14 forgiven 15 some o f t h e q u e s t i o n s 16 JUDGE O'LEARY: fo r t h in k in g so b eca u se o f th e n atu re o f that a r e p u t t o him. Mr. 17 Mohan, if you l i s t e n to th e answers th a t 18 listen 19 the tim e 20 MR. MOHAN: t o a nd . . . (INTERJECTION). R eally i t I is not for subm issions. I w a nt t o make o n e p o i n t 21 a nd i t 22 in stru ction s 23 fu llest 24 that 25 JUDGE O'LEARY: f r o m my c l i e n t extent p o ssib le . certain ly in to is th is: cooperate I have in the I t h i n k you have s e e n some m e a s u r e t h i s afternoon. But h a v e I e v e r 26 suggested f o r o n e moment t h a t 27 clien t 28 MR. MOHAN: 29 of all. 11 12 the ex ten t a nd w h e t h e r h e was a c l i e n t . 8 9 accused of anything, w asn't your cooperating? No. What I am c o m i n g t o 1 disagree with it: 2 a much better position to assist armed with this 3 documentation and whatever other documentation you 4 have which has not been put to him. 5 that, we could prepare a more detailed statement for 6 him and to re-visit here on foot of that letter. 7 JUDGE O'LEARY: I would feel that we would be in If we had Mr. Mohan, the position is that these type of 8 9 enquiries -- and it is an enquiry into Ansbacher -­ 10 have been conducted in this method for quite a long 11 time. 12 As far as I am concerned I am looking for 13 explanations. 14 limited to today in the explanations which I am 15 given. 16 precisely the same weight. 17 client to know about a £45 payment. 18 ridiculous. 19 have some memory of a payment of £1,700,000. 20 It is an entirely different thing. 21 continue with the questioning, Mr. Mohan, and if we 22 come to any preliminary conclusion -- it is only 23 if -- which is potentially unfavourable to the 24 interests of your client, we will of course hear any 25 evidence he wants to put. 26 submissions you or any other counsel or solicitor 27 wants to make on his behalf and anything he wants to 28 say himself. 29 likes. It is specifically provided in the Act. I made it quite clear that I am not Any explanation I get after today will get I don't expect your That would be I would however think that he might I am going to We will listen to any He can call whatever evidence he At the moment I am continuing with the 1 2 3 the point and you have 4 noted the points that I have made. 5 JUDGE O'LEARY: I have indeed noted them carefully and I want to 6 7 emphasise that this is an enquiry under the 8 Companies Act and that is all it is. 9 to page 79 -- Exhibit 11 -- Mr. Mulhern, that Getting back 10 appears to me to be an instruction from 11 Ms. Williams. 12 A 13 238 Q 14 A 16 239 Q 17 She is now retired. She worked with Mr. Traynor, That's correct. She worked with him in Guinness & Mahon and later in CRH? 18 A 19 240 Q 20 A 21 241 Q 22 A 23 242 Q 24 A 25 243 Q 26 A 27 244 Q 29 I knew Ms. Williams. isn't that correct? 15 28 Do you know Ms. Williams? That's correct. She was his secretary at 42, Fitzwilliam Square? Yes . Did you in fact ever visit 42, Fitzwilliam Square? I did. For the purpose of business? To see him. For business purposes or not for business purposes? (No answer). In February 1994 Mr. Traynor was still alive, isn't that correct? 1 245 Q 2 A 3 246 Q 4 A 5 247 Q Your transaction with College Trustees was over? Correct. Having been completed in 1993? Correct. There was this company which you could have used if 6 you wanted to 7 somebody to the extent of transferring £1,700,000 in 8 Sterling from Hamilton Ross/Ansbacher to AIB at 9 St. Helier, Jersey? 10 A 11 248 Q 12 A and which apparently was used by Yes . Do you know anything about that? You are asking me about a specific transaction that 13 I should remember and I don't remember that 14 transaction. 15 but I can check it up and report back to you. 16 249 Q And I don't remember the timing of it Please do that and it would be very worthwhile if 17 you would check up on that and get back to us on it. 18 Did any company that you were associated with at or 19 around that time -- whether or not Debon Arabia 20 Contracts Ltd -- have an account in AIB at AIB 21 House, Grenville Street, St. Helier? 22 A They may well have had, Sir, because I wouldn't have 23 any involvement. 24 accountant's decision if there was such a thing in 25 existence. 26 While I understand that accountants might make 27 arrangements for you, they certainly wouldn't open 28 an account for you, Mr. Mulhern. 29 open an account for you without your instructions? That would have been a lawyer's or They wouldn't 1 2 251 Q. 3 4 Are you satisfied that we can take it that you had no interest in that £1,700,000? A. If JDT opened an account, he could open it in any 5 name on behalf of anyone. 6 You might find that strange but he on behalf of his 7 clients acted in what he thought was their best 8 interests. 9 pieces of paper you gave me, I couldn't explain what That was how he worked. In the same way with some of the other 10 they are or how they came into existence or why. 11 But there will be an explanation. 12 252 Q. As you will appreciate, Mr. Mulhern, this particular 13 one we are looking at now is in a different 14 category? 15 A. 16 253 Q. Yes, I see that. Because it goes to that company. I don't know who 17 the beneficial owner of that is. I don't know who 18 the beneficial owner of that company. 19 what you said, that you had some knowledge of the 20 company and you could have used it. 21 prove that you actually used it, of course not. 22 Some of the other documents are in an entirely 23 different category because they are money which 24 admittedly ended up in your accounts. 25 talking about is the state of your knowledge. 26 It actually ended up in your accounts so these are 27 factual matters. 28 it ended up really. 29 investigate that and report back to me on that I do accept That doesn't What we are In this case we don't know where I would like you to 1 2 I will also report back to you, Sir, on the other 3 one that you sprung at me for £1,300,000 in 1993. 4 254 Q 5 A The £750,000 I know about but the £1,300,000 ...(INTERJECTION). 6 7 And the £750,000? 255 Q If you remember the £750,000, you were going to tell 8 me the date you received it, the interest which you 9 paid on it and who you made the repayment to? 10 A Absolutely. I am only in the mists of my mind now. 11 The £1,300,000 had me mystified. 12 £1,300,000 may have been was the fact that I may 13 have owed my own company monies and if the business 14 was going to be sold to Waterford Foods at that time 15 I may have wanted to pay that back into the company 16 so that it was there. 17 a debt to a director. 18 256 Q 19 20 I understand that. But what the That the debt wasn't down as If you did that, whose money was used for that purpose? A I may have borrowed the money to put that back in 21 in the light that the Waterford Foods transaction 22 was going to take place. 23 257 Q 24 A 25 258 Q 26 A From Ansbacher? From JDT. From Ansbacher effectively? You are saying that to me now, Sir. It is very 27 easy to be wise at this time. 28 have borrowed it from JDT and it wouldn't have had 29 anything to do with Ansbacher so far as I was At that time I would 1 2 Did you think when he was operating from 3 42, Fitzwilliam Square, Mr. Mulhern, that he was 4 operating some kind of personal loan service where 5 he made loans to people himself personally? 6 A He supported anyone in a venture capital situation 7 that he had regard for or had been involved with or 8 had some success with. 9 helpful man. 10 260 Q 11 A He was an unbelievably Where did you think the money was coming from? He had been an enormous success himself. 12 I wasn't concerned; he could provide funds from 13 wherever. 14 30 years from £12,000 to £2,500,000. 15 261 Q And that had been my experience over I will show you Exhibit 12 -- page 163 Mr. Mulhern. 16 To be fair to you, Mr. Mulhern, I should give you 17 every page from page 156 onwards. 18 reports and financial statements for Icecream 19 Marketing Ltd for 14 months to 14th July 1995. 20 They were audited by Deloitte & Touche. 21 page is "contents" (Exhibit 12) and nothing arises 22 in respect of that. 23 directors of the company. 24 A 25 262 Q 26 A 27 263 Q 28 A 29 264 Q These are The second page is the Who is JT Johnson? The company secretary and accountant. Does he operate from your business? Yes . He is an employee in other words? Yes . It looks as if the registered office is at 53 The first 1 Deloitte & Touche rather than your own place of that 2 particular company anyway at that stage? 3 A. 4 265 Q. It could be. Page 160 shows the profit and loss account which 5 indeed shows a negative profit and loss situation 6 for Icecream Marketing Ltd as you indicated to me. 7 They are signed by yourself and Mr. Johnson. 8 Do you see "directors and secretaries interest in 9 shares" on page 163? 10 A. 11 266 Q. Yes. This is only typical of the kind of document which 12 you would have had for Clayton Love as well. 13 I picked it out because it just came to my 14 attention. 15 16 17 18 It says: "None of the directors or secretary had an interest in the share of the company at the end of the period. The directors and secretary had the following interest in the shares of Clayton Love Distribution Limited, the holding company at the end of the period." 19 20 You yourself had 5499 and Mr. 21 Mr. Johnson being the secretary had the same 22 interest in the same share. 23 paragraph that I am interested in. 24 25 26 27 28 29 JT Johnson 1. It is the next It says: "The directors and secretary have no interest in the "B" ordinary share capital of Clayton Love Distribution Limited. The directors who held office until 31st July 1995 had the following interest in the share capital at the start of the financial period." 1 interest in those "B" ordinary shares at that time. 2 This is after the takeover? 3 I couldn't tell you, Sir. 4 267 Q The reason I ask you is because of course you signed 5 the accounts, I didn't sign the accounts. 6 You signed the accounts and presumably as you signed 7 the accounts you would have had some knowledge of 8 them. 9 know who had an interest in the "B" ordinary shares? 10 A You cannot make that statement unless you If the shareholding changed, as it obviously did 11 otherwise Deloitte & Touche wouldn't have put that 12 in. 13 anything to me. 14 268 Q 15 A 16 269 Q That is a technical thing and it wouldn't mean You don't know? No, but we can find out. I am not really that terribly interested in the 17 factual situation. 18 and that everything like that is absolutely 19 correctly done. 20 It is the state of your knowledge that I am 21 interested in rather than the actual situation. I am 22 not suggesting for a moment that there is anything 23 illegal. 24 A I am sure you are well advised I have no doubt about that. It wouldn't concern me; that is for somebody else to 25 worry about. 26 Could I bring you back to something that may concern 27 you: 28 asking you the question. 29 from my point of view. Look at it from my point of view when I am For one moment look at it You have given me the 1 following information: 2 trouble with Findus or Nestle? 3 Yes . 4 271 Q 5 At the time you were having They were interfering in the way you wanted to run your business? 6 A 7 272 Q Yes . And they wanted you to do things that were unacceptable to you? 8 9 A 10 273 Q Yes . They were, as you said, spending more time in lawyers's offices than they were in the business? 11 12 A 13 274 Q 14 Yes . So you had a bitter experience. And I am sure it was from the way you spoke about it? 15 A 16 275 Q 17 Yes . This is what I have picked up, that you had a bitter experience of an interfering minority shareholder? 18 A 19 276 Q That's correct. In that context another minority shareholder by the 20 name of College Trustees arrives on the scene 21 arranged of course by your good friend, Mr. Traynor. 22 But why did you not suddenly consider yourself 23 'Am I going from the frying pan into the fire. 24 I am giving 45% of company to people and I don't 25 even know who they are.' 26 that? 27 Exactly as I said to you earlier, I had never found 28 him wanting previously so why should I have been 29 concerned about it then. What do you say about If he said it would be 1 2 That may well be the case, no doubt you had a lot of 3 reliance on his word and that sort of thing. 4 But ultimately it wasn't Mr. Des Traynor who was 5 buying the shares, it was College Trustees. 6 They could have fallen out with Des Traynor the 7 following week and you were left with 45% of a 8 shareholding from people you didn't even know? 9 A Guinness & Mahon as I explained to you. 10 11 My assumption was that College Trustees was part of 278 Q But did you think that Guinness & Mahon were 12 actually taking a share in your company or did you 13 think that they were acting for somebody else. 14 That is the point I am making to you? 15 A No. If Guinness & Mahon had taken a part in the 16 company they would have charged interest the same as 17 everybody else and they would have got paid at the 18 end of day. 19 279 Q 20 A That is what they would have done. So it wasn't Guinness & Mahon? If JDT put some form of company into play on my 21 behalf, I didn't have any concern that it was in 22 anything but the safest of hands. 23 has something to do with the changeover after we 24 bought in the shares because after we bought the 25 shares in there were no "B" shares. 26 280 Q 27 A 28 281 Q 29 But that there I don't know, that is what it says? I am assuming that is what happened. You might get an explanation. There is probably a technical explanation for it and all I want to do is 1 find out what the technical explanation is so that I 2 can forget about it. 3 MR. MOHAN: It will be forthcoming. JUDGE O'LEARY: Exactly. 4 282 Q 5 directors of your company in 1991, Mr. Mulhern, do you remember approximately? 6 7 A 8 283 Q 9 A I would say that Mrs. Love was the Chairman. Is that A.G. Love? Yes. Myself, Mr. Johnson and I am not sure...(INTERJECTION). 10 11 284 Q 12 A 13 14 Who were the There is one more, Mr. Field-Corbett? Sam Field-Corbett would have been there looking after the interests of College Trustees. 285 Q Mr. Mulhern, you never told me that before. 15 Are you saying to me that when College Trustees got 16 45% of the company, they put in a director? 17 A 18 286 Q 19 They were entitled to do that. I am not saying they weren't but you never told me that? 20 A 21 287 Q 22 A 23 288 Q He had no influence whatsoever in what happened. But he was a director? There is nothing strange about that. No, except that when I was asking you about the 24 thing from the very beginning, you never said to me 25 that there was a director appointed by the "B" 26 shareholders ? 27 28 29 A He never attended a meeting in the whole time that they were involved. 1 I met him the day that College Trustees took over 2 and I met him the day that they left. 3 290 Q So in other words your point of contact once the 4 deal was done with College Trustees was 5 Mr. Field-Corbett rather than Mr. Traynor? 6 A No, Sir, it was not. I had no dealings with 7 Mr. Field-Corbett at all but when old Mr. Love died 8 and there was a space on the Board he was appointed 9 so called to look after the interests of the College Trustees shareholders. 10 11 291 Q 12 A 13 292 Q What date was he appointed in that position? I don't know but I can find out. I will show you now Exhibit 13 -- page 258. 14 What did you say, Mr. Mulhern, was the way you 15 financed the £3,000,000? 16 A 17 I thought we did it from our own resources and borrowings. 18 293 Q 19 A 20 294 Q 21 A 22 295 Q How much had you of your own resources? I thought it was £1,500,000. How much did you borrow? We must have borrowed the balance. It appears to me that at 31st July 1994, which was 23 the first period after the transfer had taken place, 24 there was a new secured loan of £2,266,000. 25 Do you see that? 26 A Yes . 27 Could you point that out to me on the balance sheet 28 of Clayton Love -- I don't expect you to do it 29 now -- that £2,266,124 new secured loan. 1 I want to identify it on the balance sheet of the 2 company? 3 A. 4 297 Q. Okay. Because in fact in July 1994 there was £1,300,000 5 cash in the bank which was only changed from 6 £2,000,000 the previous year. 7 the end of July 1993 you had £2,000,000 in the bank 8 but by July 1994 you had £1,370,000 in the bank. 9 So it doesn't appear to me that however it was In other words, at 10 financed, that there was much of it financed in cash 11 if you understand the point I am making? 12 A. 13 298 Q. Yes. You might just have a look at that and give me an 14 explanation of that. 15 the explanation around in your head for that. 16 It is obviously something I am interested in in view 17 of the other substantial money transfers which took 18 place. 19 MS. MACKEY: I have no questions. 20 MR. MOHAN: I wonder would it be I don't expect you to carry I have no further questions. 21 suitable now to fix a date 22 for a second occasion or maybe to keep in touch with 23 you? 24 JUDGE O'LEARY: I think the best thing to 25 do, Mr. Mohan, is to send 26 us in information. 27 Mr. Mulhern again at all. 28 objection if you really want us to see him of 29 course. We may not want to see We will have no If we come to any conclusion on a 1 preliminary basis which is adverse or which could 2 possibly be adverse to the interests of Mr. Mulhern, 3 you will have an opportunity of coming in here and 4 calling evidence and doing anything you like with 5 regard to the matter. 6 MR. MOHAN: 7 I accept that. We do wish an opportunity 8 to deal with these issues raised and we will deal 9 with them in writing first. 10 JUDGE O'LEARY: Deal with them in writing first. 11 Then they will 12 either remain issues, in which case we will arrange 13 for another interview or they won't remain issues. 14 But I tell you one thing, Mr. Mohan, we are moving 15 on with speed at this stage. 16 MR. MOHAN: 17 18 I don't doubt that for one moment. JUDGE O'LEARY: We are moving on because it is hanging on for too 19 20 long and it is in nobody's interest to hang on. 21 While these are very important questions, I don't 22 think they are difficult questions. 23 MR. MOHAN: 24 They are not but they may take weeks in order to 25 gather some documentary information which may be of 26 interest. 27 JUDGE O'LEARY: I would expect 28 Mr. Mulhern's records of 29 his companies to be as organised as I would expect 1 2 organised. I think all that information would be 3 instantly available, not to Mr. Mulhern but to his 4 accountant. 5 MR. MULHERN: I hope you are right. 6 JUDGE O'LEARY: We will leave it at that 7 8 for the moment and we will keep in touch. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF INTERVIEW WITH MR. JOHN MULHERN * h . 23-MRR-2001 17:31 FROM REDDY CHARLTON MCKNIGHT TO 2033929 NARRATIVE S T A T E M E N T OF JOHN M U L H E R N • 23"1MARCH 2001 . I set up Oayton Love Distribution Limited in June 1966. This company was then and is now a frozen food distribution company. The business was then controlled by the Oayton Love fam ily. I was, however, Managing Director o f the company. The business took some tim e.to establish and grew .modestly during the early years. In 1972, .Nestle lim ited, a m ultinational, and I acquired the entire shareholding o f Oayton Love Distribution Limited from the Oayton Love fam ily. I purchased 55% of the shareholding and Nestle Limited purchased 45% o f the shareholding. The company operated cold storage premises a t SirJohn Rodgersons Quay in the City o f Dublin and operated a food distribution business throughout the twenty six counties. My shareholding was purchased through a commercial loan a t normal commercial rates over a ten/fifteen year period. Throughout the 1970's the company thrived adding extra brands to th e portfolio. Between 1978 and 1982 differences arose between th e two shareholders, namely m yself and Nestle Limited's representatives. These differences centred on the control and direction of the company. I t became • » dear th at one party would have to acquire the other party's shareholding and interest Discussions and negotiations were protracted and took place in early 1982. Eventually a deal was worked put whereby a formula was reached which fixed the value o f the company. During these negotiations Mr Desmond Traynor acted as my adviser. In order to raise the funds to purchase the Nestle Limited shareholding I contacted Guinness & Mahon Bank who had previously provided me with banking facilities. Mr Desmond Traynor was then the Chief Executive o f the 23-MfiR-2001 1?.*31 FROM REDDY CHfWLTQN MCKNIGHT TO 2833929 dank and advised and assisted me with regard to raising the finance to purchase the Nestle Limited shareholding. - M r Desmond Traynor purchased the Nestle Pic shareholding on behalf o f a company called College Trustees Limited on the 27th January 1983 and Exchange Control was granted for this transaction. I understood this company to be an investment vehlde. . I remained m control of Clayton Love Distribution Limited and kept M r Desmond Traynor informed on an annual .. . basis of the company's performance. NO dividend was declared during the - period that College Trustees Limited were entitled to the beneficial ownership V -'i' o f 45% of the shareholding, nor was any return made to College Trustees Limited for the Investm ent It was understood to be a capital investment which would become m ature in tim e. . In 1992 the company was approached by another larger food processing company with a view to purchasing ail the shares o f Dayton Love Distribution Limited. This put the issue o f the ownership o f the company on the agenda. I also was keen to acquire the full ownership of the company. A formula was agreed whereby the valuation o f the company, was fixed and based on. this valuation the company purchased the 45% shareholding held by College Trustees Limited. The method by which this was done was th at Clayton Love ' ; Distribution Limited In fact purchased the shares owned by College Trustees Limited. This deal was completed on the 29th day o f October 1 9 9 3 .1 had no further dealings with College Trustees Limited and Z never had any dealings with Ansbacher (Cayman) Limited. Having regard to the duration of tim e over which these matters have transpired there has been some difficulty in obtaining documentation,however, any documentation which is available will o f course be furnished to the Inspectors. P. 03/04 i ;. • 23-MPR-2001 . 1?.*32 ' ® 1 • FROM REDDY CHARLTON MCKNIGHT ' TO 283392S . The above transaction sets out the scope of my involvement with the various companies referred to In your correspondence. I confirtn that I am happy to make myself available for interview with you. ' tH : i V.-/- . . •; • * ' *1 * ""I*~itn h f l m "iiftiKrfto n w rt P .04/04 T H IS A G R EEM EN T i s m ad e t h e d a y of . 19 9 3 B e tw e e n C o ll e g e T r u s t e e s L im it e d o f P .O . B o x * 1 2 2 , S t . J u lia n s C o u r t , S t . P e t e r s P o r t , G u e rn s e y , C h a n n el Is la n d s . ( h e r e in a f t e r c a lle d " t h e V e n d o r " ) a n d C la y t o n L o v e D is t r ib u t io n L im it e d w h o se r e g i s t e r e d o f f i c e i s a t J a m e s to w n Road, In c h ic o r e , D u b l in 8 ( h e r e in a f t e r c a lle d " th e P u r c h a s e r " ). W H ER EA S: 1. 2. • . T h e P u r c h a s e r w a s in c o r p o r a t e d i n t h e R e p u b l ic o f I r e l a n d o n 2 0 t h A u g u s t , 1 9 8 1 u n d e r t h e C o m p a n ie s A c t s , 1 9 6 3 t o 1 9 7 7 a n d h a s a n a u t h o r is e d s h a r e c a p i t a l o f £ 1 0 ,0 0 0 d iv id e d i n t o 5 ,5 0 0 " A " S h a r e s o f £ 1 e a c h a n d 4 ,5 0 0 " B " S h a r e s o f £ 1 e a c h o f w h ic h a l l t h e s a i d s h a r e s a r e is s u e d a n d f u l l y . p a id . T h i s A g r e e m e n t i s m ad e b y t h e P u r c h a s e r p u r s u a n t to t h e p o w e rs c o n f e r r e d in P a rt X I of th e C o m p a n ie s A c t , 1 9 9 0 a n d b y A r t i c l e 3 9 o f t h e A r t i c l e s o f A s s o c ia t io n o f t h e P u r c h a s e r a n d ' p u r s u a n t t o a S p e c i a l R e s o l u t io n p a s s e d a t a n E x t r a o r d i n a r y G e n e r a l M e e t in g o f t h e P u r c h a s e r h e ld o n 2 9 t h O c t o b e r , 1 9 9 3 . NOW I T IS A G R E E D a s f o il o w s : 1. T h e V e n d o r s h a ll s e l l . an d th e P u rc h a s e r s h a ll p u rch a se . fre e fro m a ll lie n s , ch a rg e s and e n c u m b r a n c e s 2 ,0 0 0 " B " S h a r e s o f £ 1 e a c h i n t h e c a p i t a l o f ' C l a y t o n L o v e D i s t r i b u t i o n L i m it e d fro m th e V e n d o r. ■ 2. The P u rch a se p r ic e I R £ 7 1 1 .0 0 i n c a s h . 3. C o m p le t io n o f t h e s a l e a n d p u r c h a s e o f s h a r e s h e r e u n d e r s h a l l t a k e p la c e a t D e lo it t e & T o u c h e H o u se , E a r ls f o r t T e rra ce , D u b lin 2 on 2 9 th O c t o b e r , 19 9 3 w h e re u p o n : 4. of each sh a re s h a ll be (a ) t h e V e n d o r s h a l l d e l i v e r t o 't h e P u r c h a s e r s h a re c e r t if ic a t e s o y e r th e s h a r e s now b e in g p u r c h a s e d o r i f th e c e r t if ic a t e ( s ) i s ( a r e ) l o s t s u c h in d e m n it y a s t h e p u r c h a s e r s h a l l r e a s o n a b le r e q u i r e ; a n d (b ) th e P u r c h a s e r s h a ll d e liv e r t o th e V e n d o r a c h e q u e f o r t h e c o n s id e r a t io n d u e t o t h e V e n d o r. T im e s h a l l b e o f t h e e s s e n c e o f t h i s NtCLAVTON (UK A g re e m e n t. 5. 6. T h e P u r c h a s e r s h a l l upon th e p u rc h a s e o f th e s a id 2 ,0 0 0 "B " S h a re s o f E 1 e a c h t r a n s f e r a s u n e q u a l t o t h e n o m in a l am ount o f th e s h a r e s redeem ed t o t h e C a p it a l R e d em p tio n R e s e rv e Fu n d an d th e p r o v is io n s o f th e C o m p an ies A c t , 19 6 3 s h a l l a p p ly a s I f th e C a p it a l R e d em p tio n R e s e rv e F u n d w ere p a id up s h a r e c a p it a l o f th e P u r c h a s e r (s a v e a s m o d if ie d b y S e c t io n 2 0 8 , C o m p an ies A c t , 19 9 0 ) an d th e am ount o f . t h e P u r c h a s e r 's is s u e d s h a r e c a p i t a l s h a l l b e re d u c e d b y t h e n o m in a l v a lu e o f th e s h a r e s re d ee m ed . ' (1) T h is A greem ent . s h a l l b e b in d in g upon th e s u c c e s s o r s o f th e V e n d o r b u t s h a l l n o t b e a s s ig n a b le . . . . . . (2 ) T h is A greem ent c o n s t it u t e s th e w h o le ag re e m e n t b e tw e en , th e p a r t ie s h e r e t o an d no v a r ia t io n t h e r e o f s h a l l b e e f f e c t iv e u n le s s made i n w r it in g . , .................................. . (3 ) T h is A greem ent s h a l l b e g o v e rn e d b y an d c o n s tr u e d in a c c o rd a n c e w ith th e la w s o f th e R e p u b lic o f Ir e la n d . A S W ITNESS t h i s Ag r e ement h a s b e en s ig n e d b y o r o n b e h a lf o f th e ' p a r t ie s h e r e t o th e d a y an d y e a z f i r s t b e f o r e w r it t e n S ig n e d b y F o r an d on b e h a lf o f C o lle g e T r u s t e e s L im it e d i n th e p r e s e n c e o f S ig n e d b y F o r an d on b e h a lf o f ■ •' C la y t o n L o v e D is t r ib u t io n L im ite d in th e p re s e n c e o f : - * P lease reply to: 42 F lttw fllU m Square, D u b lin 2. ' • Tel:7fi514jV763065 ‘Fax: 61203S ' * ‘ • . P.O. Bo* M 7, Grand Caynum, Cayman Wand* British W «« Incfie* Telephone'. (i09) 949-M3 T a ta : CP 4303 FWSimil* (309) 949-W * (SM) 949-3267 • . ’ R o n an Redm ond, E s q ., ' '36th July# T992. Corporate Services, . . I r i i h I n t e r c o n t i n e n t a l B a n k L im it o d f 9 1 Merrion S q u a r e , D P B LIM 2 . . . - D ear R o n an , . * • . . . . - * w o u ld y o u p le a s e a r r a n g e t o ' t r a n s f e r t h e s u n o f X R E 7 5 0 ,0 0 0 t o t . . • f o r A c c o u n t o f* • * T h e U ls t e r B ank L t d . , D o rse t S tre e t* ■ D u b lin I jf. * • • C la y t o n L o v e D i s t r i b u t i o n L t d . th e fu n d s b e in * f a x c o n f ir m a t io n e n d i n d i c a t e t h e 0 1 a tea? B a n k v a lu e S t e r lin g ' ' - Vours sincerely, • . - '4^ J.D. Travaor. ^ D&c JDT/AJW ......... tase rtebit f-.f'. ‘ . ._— -- • --- **i»newIII>IMflWICM «^»'»«>Mwjr<,.M O tia C O A m iy w iii? v iT m i p ___ . ' . - f iy u r e o r b it e d . ■ M any t h a n k s , . ' • T h e $ t e r l i n o c o s t u h u u ld b e d e b it e d t o A n a b a c h e r L im it e d A c c o u n t H o .0 2 / 0 1 0 8 7 / 8 1 P le a s e . . ' Account MO, 29627133.. I t i s e s s e n t ia l t h a t to m o rro w 3 1 s t J u l y . . _ ' ■ .C/d-jSWOKATE SERVICES’ ; t, iHi nm ! i PEr-’0*:s *C-■ '0 5« '? STATSM .-•" '. •i • * ,U U v« • ‘ .tS » r- , l- ,*• • «. ? >H k . :-.V " ■ ' •. ;’ .W-'f' ’' ■ > « ' ^ -CAy?»A'P« :lfi16HWATl'0H*l BAilK “ ^ ^ fvt t .RvjSV - s Y ^ r?COftPA.NY’ oftPANY'’ ’L M TEB . . SSW N TT i2( LIMITED -j'V?.' --,V:- ■v ; B A W X LTD. 1 1 ■j* .•' / c/O C0RI'6HAlt’SERVICES • ' 1. aITMl*1K w KtOnONO. • ■ ■ • ■. .. ■• ■a /C: 02/U1087/U1t «/ . ';•"x2 ’, •>■ :'?• 'fe'-; . •. ■ •'* I '1 me,. N*. 40637 S.I. .* K . -u .v- ; " ►' ^ I • ■ . 1 (Pl)«)7744 333TI '■ r.--'-saac (ODTCJnXH I ;V/' OEP CL OEM tlOU HE5 * •PAGE -to: Ci:2 :riT;rjjNTOATa: ' ‘' VAUJf OTTM-S o*n h h C pibit -..f 1 Jn*k9 J • v ;7 « M 5 S { 4 ' i J J J J W k I R U .iw A L . D EP O SIT C/n 990002 1 . ■«, .ft (./A^ 8TATEMENT . lt.T6KNAT10.ttw nAiiK C ritJST C'.'I'S'AtlY LIMITED /inuSn ’ riSHB^cu-nravisrnAi-aAfaii WfeteteaSsaaa ' ' U UT.} A N S B A C H E R LIMITED P.O .-Box Bfl7 Qrand Caym an British West Indies Telephone No. 8—4653/4 Telex C P 305 Cable Address G uinness jctt•oi:h«r l.inlted L'nvronn . 8/9 ACCOUNT NUMBER 80024123 j>AQE BALANCEB SHOWN ARE IN: sterling L_ -24 iitiKVSt n/'yj. tt/VA n/ C o l \ Ansbacher limited A Mtmbtr oftinBtnryAmbadmr. Pleasereplyto: 42 Fitzwflliain Dublin2. Tel:765144/763065 . Rue 612035 f t C Uttehant tanking Group B n 887, Qaad Gmaa, British Wart bdfa R a w (KB) 949-WO/4 T«fec CP 4303 Rue (109) MMMtf •>*?•*(5 “ W . ;ilS * ,. :«fc We hereby Certifythatthewithin Profitand Loss Account, Balance Sheet,Report oftheAuditors,Report oftheDirectois,aretruecopiesofthe documents laidbeforetheAnnual General MeetingoftheCompany heldon the **T "Say of c g * s >/' *996. Deioitte & Touche, Chartered Accountants, Deioitte & Touche House, Earlsfort Terrace, Dublin 2. DdoHtBi __JM R I C E C R E A M M A R K E T IN G L IM IT E D R E P O R T S A N D F IN A N C IA L S T A T E M E N T S F O R T H E 14 M O N T H S E N D E D 3 1 J U L Y 19 9 5 CONTENTS PAGE D IR E C T O R S A N D O T H E R IN F O R M A T IO N i R E P O R T O F T O E D IR E C T O R S 3-4 S T A T E M E N T O F D IR E C T O R S ' R E S P O N S IB IL IT IE S R E P O R T O F T H E A U D IT O R S 6 S T A T E M E N T O F A C C O U N T IN G P O L IC IE S 7 P R O F IT A N D L O S S A C C O U N T B A LA N CE SH EET © NOTES TO THE FINANCIAL STATEMENTS 1 0 -1 1 -v - ■tas ICE C R E A M MARKETING LIMITED BIRECTORS AND OTHER INFORMATION DIRECTORS 'Se c r e t a r y a n d REGISTERED OFFICE ' . J.Mulhem J.T.Johnston i t .Johnston, Deloitte& ToucheHouse, EarkfortTerraco, Dublin2. AUDITORS Deloitte& Touche, Chartered Accountants. Deloitte& Touche House, EarlsfbitTerrace, . Dublin! BANKERS Bank ofIreland, Inchicore, Dublin8. louche & Chartarad Accountants .. Daloitta St Toucha House EartafortTarraca Dublin 2 Telephone: (OM 47S 4433 Facsimile: 10') 475 6622 REPORT OF THE AUDITORS T O THE MEMBERS OF ICE CREAM MARKETING LIMITED We haveauditedthefinancialstatementson pages 7 to 11which havebeenprepared undertheaccounting policiessetoutonpeige7. .. ^ Respective responsibilitiesofdirectorsand auditors . >-' , As describedonpage 5thecompany'sdirectorsareresponsibleforthepreparationoffinancialstatements. Itis V^'Sur responsibilitytofarm an independentopinion,basedon ouraudit,on thosestatements andtoreportour ^•••.'opiniontoyou. ‘ Basis ofopinion We conductedour auditinaccordancewithAuditingStandardsissuedby theAuditingPractices Board. An auditincludesexamination,on atestbasis,ofevidencerelevanttodieamounts anddisclosuresinthefinancial statements. Italsoincludesan assessmentofthesignificantestimatesandjudgements made by thedirectorsin diepreparationofthefinancialstatements,andofwhethertheaccountingpoliciesareappropriatetothe company’scircumstances,consistentlyappliedandadequatelydisclosed. We plannedand performedour auditsoastoobtainalldieinformationand explanationswhich we considered necessaryinordertoprovideuswithsufficientevidencetogivereasonableassurancethatdiefinancial statements arefreefrom materialmisstatement;whethercausedby fraudorotherirregularityorerror. In formingouropinionwe alsoevaluatedtheoveralladequacyofthepresentationofinformationinthefinancial statements.’ . • Opinion . . . •Inouropinionthefinancialstatementsgiveatrueandfailviewofthestateofthecompany'saffairsasat31 July 1995 and ofitslossfortheperiodthenendedandhavebeenproperlypreparedinaccordancewiththe Companies Acts, 1963 to 1990. We haveobtainedalltheinformationandexplanationswe considernecessaryfordiepurposesofouraudit In ouropinionproperbooks ofaccounthavebeenkeptbythecompany. The financialstatementsarein agreementwiththebooksofaccount •. InouropiniontheinformationgivenintheReportoftheDirectorson’pages3 to4 isconsistentwithdie financialstatements. . The balancesheetofthecompany,onpage 9 shows andexcessofliabilitiesoverassetsand,inouropinion,on thalbasistheredidexistat31July 1995 afinancialsituationwhich,underSection40(1)ofdieCompanies (Amendment) Act, 1983,would requiredieconveningofanextraordinarygeneralmeetingofthecompany. Deloitte & Touche Chartered Accountants and Registered Auditors f* 38/-4/01 15:19:27 -> “USSd ' ZB33929 Page 033 1 C I C R E A M M A R K E T IN G L IM IT E D STATEMENT OF ACCOUNTING POLICIES ACCOUNTING CONVENTION The financialstatementshave beenpreparedonthebasisofthehistoricalcostconvention. . ft) 'V ■ ■ ■ >‘) BASIS OF ACCOUNTING The financialstatementshavebeenpreparedondiegoingconcernbasisbutintheeventofthecurtailmentor cessationofexistingoperationsintheforeseeablefutureno materialadjustmentwouldbe necessary. 0 Ustti* W J selectsuitableaccountingpoliciesandthenapplythem consistently; makejudgements and estimatesdialarereasonableand prudent; prepare thefinancialstatementsoildiegoing concernbasisunless itisinappropriateto presume thatthe company willcontinueinbusiness. The directorsan responsibleforkeepingproperbooksofaccountwhich disclosewithreasonableaccuracyat anytimethefinancialpositionofthecompanyand toenablethem toensurethatthefinancialstatements comply withtheCompanies Acts, 1963 to 1990. "Theyarealsoresponsibleforsafeguardingdieassetsoftho company andhence fortakingreasonablestepsforthepreventionanddetectionoffraudand other irregularities. • . 3tP4/BI 15:28:14 -> 2B33929 page 036 fln U ltln t UQMuB& Me IC E C R E A M M A R K E T IN G L IM IT E D N O T E S T O T H E F IN A N C IA L S T A T E M E N T S F O R T H E 14 M O N T H S E N D E D 3 1 J U L Y 19 9 5 B A S IS O F A C C O U N T IN G The holding company, ClaytonLove DistributionLimited,willfortheforeseeablefixtureprovidesuch financialsupportasmay be necessarytoenablethecompany tocontinuetradingandtomeet its liabilitiesastheyfelldue. - Giventhisongoingfinancialsupportby dieholdingcompany,4>edirectorshave adoptedthe.going concernbasisindiepresentationofthesefinancialstatements. .-•■v •, ) 2. P R O F IT O N O R D IN A R Y A C T T V m E S B E F O R E T A X A T IO N 1995 1994 TR£ JR£ 362 875 1995 IR£ 1994 IRE 304 - ' 168 . 44, This isstatedaftercharging: Auditors'remuneration 3. TAXATION ’ . Corporadontaxbased on profitfortheyear Adjustmenttoprioryeartaxprovision & .. . “304 ”212 1995 1994 JR£ ERi 36 5 13,74 5 468 5,448 27,758 - A corporationtaxcharge ariseson depositinterestreceivable. 4. DEBTO RS . Trade debtors Prepayments Amount due ftom connected company Amount due from group company DtJoftta* :i. tB > I C E C R E A M M A R K E T IN G L IM IT E D NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE 14 MONTHS ENDED 31 JULY 1995 5. ' CREDITORS (Amounts Ming due within oneyear) . • Tradecreditors Amounts due toconnectedcompanies Taxationand socialwelfare Accruals 1995 1994 m m _ . . . . y j) 354 us 8,033 2,013 580 1,279 2,121 10,744 3,754 >%• ^ ) The amountdueinrespectoftaxationand socialwelfareiscomprisedasfollows: * . VAT Corporationtax 6. © . CREDITORS (Amounts fallingdue aftermore thanoneyear) 7. SHARE CAPITAL 1994 1,709 304 1,111 168 2,013 1,279 1995 OLE 1994 IR£ •• » 79,488 Directors1loan _ ... Amounts owed toholdingcompany • 1995 IRE ■ . ■ TR£ 79,488 . 79,488 79,488 1995 ER1 1994 nt£ 1,000 1,000 Authorised: Ordinary shares o f HUE 1 each Allotted, called-up and fully p a id : Ordinary shares o f E R ll each 30/04/01 10:22:58 r * IS CLA YTO N L O V E D IS T R IB U T IO N L IM IT E D C O N S O L ID A T E D C A S H F L O W S T A T O f f iN T F O R T H E Y E A R E N D E D 3 1 S T J U L Y 159 4 Notes 1994 1993 IR £ m N E T C A S H IN F L O W F R O M O P E R A T IN G A C T IV IT IE S 21 R E T U R N S O N IN V E S T M E N T S A N D S E R V IC IN G O F F IN A N C E * 1,549,737 . 50,333 (92,848) 117,488 (138,778) (42,515) (21,290) (515,672) (720,250) Purchase o f tangible fixed assets Sale o f tangible fixed assets (56,755) 974 (117,566) 21,259 N E T C A S H O U TFLO W FRO M IN V E S T IN G A C T IV IT IE S (55,781) Interestand rent received /^Interest paid • ......... . .. ;N E T CA SH O U TFLO W FR O M R E T U R N S O N IN V E S T M E N T S A N D S E R V IC IN G O F F IN A N C E . 1,175,363 TAXATION Corporation taxpaid IN V E S T IN G A C T IV IT IE S >,r^ ’ g g r ~V * n f .Tf t s j j*r** s ****” **liiiV t*' \ \ V ' *(3,217£75) 5gSr Purchase o f own shares N E T C A S H O U T F L O W F R O M F IN A N C IN G D E C R E A S E IN C A S H A N D C A S H E Q U IV A L E N T S (96,307) .. 22 * * sr‘ '■ ' t ‘ & * * - ■ ■ ■ (681,856) (112,100) (681,856) (112,100) O ur Ref: C /M 15 /F G Y o u r Ref: D O D /S B 2nd Ju ly 2 0 0 1 M r D o m in ic O ’D ow d Reddy Charlton M cK night Solicitors 12 Fitzw illiam P lace D u b lin 2 STRICTLY PRIVATE AND CONFIDENTIAL - ADDRESSEE ONLY Re: Your Client Mr John Mulhern D ear M r O ’D ow d T h e Inspectors have asked m e to w rite to you as a reminder o f the outstanding item s, w hich yo u r d ien t is required to furnish to the Inspectors arising out o f his interview w ith them on 9fc M ay 2 0 0 1. These item s specifically indude: • • • • • • • • D etails on his receipt o f £750 ,0 0 0 w hich he said under oath that he received from D es Traynor: the date he received it, the date it was repaid and the nam e o f the person or entity to w hich it was repaid; Sim ilar details re withdraw al o f £ 1 .3m, as discussed during his interview ; A n explanation o f the security backing the “suitably secured” loan to Ice Cream M arketing Ltd , as discussed during his interview; D etails on the withdraw al from Ansbacher in favour o f G arkw ood H o ld in gs, as discussed during interview ; . D etails on the establishment o f Debon A rab ia Contracts Ltd , specifically whether he paid for same, A n explanation o f the receipt o f Debon A rabia Contracts Ltd o f £ 1 . 7 m from Ham ilton Ross, as discussed during interview; Ow nership details o f the “B ” ordinary shares in Clayton L o v e in 19 9 5; T h e date o f Sam Field-Corbett’s appointment to the board o f Clayton Lo ve; n • Identification o f the 1994 secured loan o f £2,266,124 on the balance sheet o f Clayton Love, as discussed during interview. The Inspectors now require you to furnish said information within 14 days o f the date of this letter. Yours sincerely ces Gaynor etretary to the Inspectors 13 i'S f * * %• , \ 01 ‘. H j ' i t c r * 16:31 . RCMCK © 6lj E u n o r e A M T i u o i i M M u a tto rm k y s 1 2 ric r w . illiiir r . P l* c < D u b lin DOD/SB O L 'R R f.r. ® 0 0 1 2 T el ( flljA A f V .li} fw (0 1 ) 6 * 3 DX 1 0 9 0 - ” F ir/w iliia m v :9 2 E m a il K’m c k ^ r c m c k . c o m W .b w r w w .r c m c k .tim t YO U *. R tf: 13 August, 2 0 0 1 Office O f The Inspectors Appointed By Order O f The High Court To Ansbacher (Cayman) Limited, Third Floor, I ndent House, Blackrock, Co. Dublin. _ FAX NO. 283 3929 K£: O u r Client: John Mulhern Pear Sirs, W e refer to your letter o f the 2nd July as follows: i. The £750,000 was received on the 29th July 1992 and it was repaid on or about the 3rd/4 ‘h November 1992. It was repaid to Irish Intercontinental Bank. The £1.3 million was borrowed at the end o f July 1993 and was repaid by means o f another loan at some tim e in November 1993. 3. Our clicnt understands and accepts the meaning o f the term “suitably secure” as explained by Inspector O’Leary at page 38 o f the transcript at his interview. However, our clicnt has no knowledge o f any deposit backing the loon in question. Our client has made enquiries from his accountants and has also made enquiries into his own affairs from his own company and reiterates that he is not aware o f any deposit made by him or on his behalf to “back” the loan matters in question. We would also wish to point out that Mr Traynor on many occasions dealt with on our client’s behalf without specific direct reference to our client. As far as our client was and is concerned he never had an Ansbacher account, or money in a joint one. 4 The Clarkwood Holdings Limited was formed in 1988 as a non-trading company with £2 issued share capital. The company’s sole trade was the purchase o f horses and it received loans to finance those purchases. In November 1990 the issued share capital was increased to £100 with P a r t n e r s ) O M f d C lu r t f o r . jr t h * M c K n ig h t P au l M . K esn c S o lic ito r # : D iiiJ t c R c : J i y h. a . , R O ju r O S io c h a in * .s M D o m i n i c Q 'D o w < l i . c . U , .ii.M A P trg a t A**<»ci*tcOfRcc* inA:H**t* Beirut Brumh N ew V a n N‘ iC o » i; ? ra g u < C . n.i':. . & .A ., u . . * „ fc .v .u .A , f i o b i r ? M c Q w y c r 9 .1 .1 .. H .?> .*.$.» ........... i n i A . Connhlmno; Gc5.r©:di» Clnrtivit «.c U. C>.r»*rcph«r 8. H»r.»rcy V ilu u . Hamburg 'itt Av’w it .j No«t Own/ »i>bvr L«nd«n i.'.'cir.kourR T o rc e lfi V i r g in 7.»- our client, John Mulhem, holding 55 shares and College Trustees Limited holding 45 shores for which shares it paid £45. College Trustees Limited held those shares in trust for Debon Arabia Contracts Limited. This increase in share capital and division o f shares was done on the basis o f fin&ngial advice from Mr Des Traynor so that it was held in the same ratio as Clayton Love Distribution Limited. . 5. From enquiries our client can confirm that Debon Arabia Contracts Limited was incorporated on the 25* February 1981. It was a shelf company purchased by Mr Traynor in Jersey. Our client believes from enquiries that the company was purchased by Mr Traynor as a vehicle for John Mulhera / Clayton Love Distribution Limited. Our client does not recall paying for it’s establishment but accepts that it was established for his benefit and therefore he lias paid or should have paid for its establishment. t>. The price paid by Clayton Love Distribution Limited and County Fair Foods Limited (a subsidiary o f Clayton Love Distribution Limited) for the 4,500 shares was £711 per share as fixed by Deloitte & Touche as fair value. Clayton Love Distribution Limited paid £1,422,000 to College Trustees Limited for 2,000 shares in Clayton Love Distribution Limited. County Fair Foods paid £1,777,500 for 2,500 shares to College Trustees Limited. The proceeds o f this second transfer, namely £1.77 million, was passed from College Trustees Limited to Debon Arabia Contracts Limited. This money was passed to Debon Arabia Contract Limited’s bank at AIB, Channel Islands in Jersey. Our client can confirm (hat he did become the beneficial owner o f the £1.7 million. 7. The Companies Acts require that the director and secretary’s interest in the share capital o f the company and the company's parent company be disclosed in the report o f the directors. At the commencement o f the 14 month period aided 31** July 1995 the entire share capital (2 shares at £1 each) o f Ice Cream Marketing Limited was held by our client and this fact is disclosed on page 4 o f the report o f directors. During that period Ice Cream Marketing Limited became a wholly owned subsidiary o f Clayton Love Distribution Limited and therefore at the end o f the period none o f the directors had an interest in the shares o f Ice Cream Marketing Limited. As the company was a subsidiary o f Clayton Love Distribution Limited at the end o f the period it was therefore necessary to disclose the directors and secretaries interest in the shares o f Clayton Love Distribution Limited at the end o f the period. At that lime the issued share capital o f Clayton Love Distribution Limited was £8,000 made up of: 1. 5,500 A ordinary shares o f £1 held by J.E. Mulhem 5499, J.T. Johnston 1. 2. 2,500 B ordinary shares o f £1 held by County Fair Foods Limited. The report o f the directors disclosed the holding o f the shares by our client and Mr Johnston and also disclosed the feet that none o f the directors had an interest in the B ordinary shares. The shares in County Fair Foods Limited arc wholly owned by Clayton Love Distribution Limited. 8. Sam Field Corbett was appointed a director o f Clayton Love Distribution Limited in July 1983. 9. Our client has made enquiries from his auditors and it appears that a mistake was made in that the figure described as new .secured loans being £2,266,124 should have read “new sccured and other loans” being made up o f new secured loans o f £1,225,000 and other loans £1,041,124. The new secured loan was from National Irish Bank Limited and was the amount drawn down on foot o f an addition facility o f £1,700,000 obtained to enable the company to purchase it’s own B shares. The sccured loans were further dealt with in note 12 o f the financial statements t^ 3 whereby it was stated that the balance outstanding at 31“ July 1994 was £1,422,900 and at 3 l sl July 1993 was £490,000. Thesis amounts are reconciled as follows: balance at 31/7/1993 £490,000 new secured loans (as above) £1,225,000 capital repayments (292100) as per consolidated cash flow statement balance at 31/7/1994 £1,422,900. Yours faithfully, R ED D V C H A R LTO N M cK N l rrmck@rcmck.com li. « 2'.-.An*b«cliet'Jol» Mulhtm'0Iw$13Jtr.doc T •-\ n;.%^\<•io;,\t i<■■>\ ; : - : jl : 1 i ; :: : I).;i'I:> 2 T el ii r« DX F t tv .ti l I' i .!•; . .i• 1 r . • • ;' (■ " s .' ) : !•:r.-.. i . VX : ^ :v >. i ' o ::: W eb C/M15/MLC/ML DOD/SB N<>v.*inber, 2001 H i-. H'h'Q of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Limited, ' i i ' i d ■ h'OT. '! -ner Home, FA X N O . 283 3929 (. •• -S'ihSin. I .a .u . M a r y C u m m i n s HF: O ur C lient: John M ulhern I ‘car Madam, vd-. r to previous correspondence and n o w furnish our client’ s reply to your letter of the 25Jl 2U0I. our:: iluthfiyrfw/ ft) • . - ...... / - / ---------------------------- • t '. D I J y <^HA3RI/TON McKNIGHT. com »iulhcir.'0]iicv2' Ur doc i*! O u t c r y Offwi* ■ \:■ R n i'-»n ° Poi.i-rtMcDwvl C W « .™ < ' • -•» . I< i! ''.i. B .C .l. T h « « r .« G Dominic O'fVwd s.c.i. F«f{sl McKnighr ^ 0 % n -.u l< a n t> . A -U O .-1 C a... :.:. O 'i ^ - p h c r P. *5.* « • %t 2» «' i I ■ ■' « ■l f M .m - n u.e.. t.r \l..\ ns..s.t.m.a. D»«»icnA. fry OttitC M l n i g c » H .'! - ; .'! .. i .'!'<•!» M.i:'.!.;i.1ii’ I< '■'■1 '.M'.'!. i;t'iir.h -i..,.. «. D u cr* I •I! *•. ■- >■_ 1:ii W e wish to take this opportunity to set out our client's reply to you with regard to the preliminary conclusions as set out in your letter of the 25th October 2001. O u r client takes no issue in relation to matters set out in the first paragraph of that letter. O u r client does, however, take issue with the preliminary conclusions set out in that letter. In relation to matters referred to in the third paragraph of your preliminary conclusion w e would respectfully point out that at our client's meeting with tne Inspectors he w a s asked questions about these issues without any prior notice. Y o u will recall that M r M o h a n S.C. on behalf of our client took exception to the m a n n e r and format of the questioning. It is again reiterated on his behalf that the interview w a s in the form of an ambush. It w a s explained that any issue on which the Inspectors wished to have detailed information, or to have documents furnished to them, would have been dealt with, w h e n our client had an opportunity to check his records. Therefore, - m h issue that w a s raised w a s deait with comprehensively in our letter of the 13th August. It is in this context that our client takes exception to the assertion that his evidence can be called into question w h e n he w a s not afforded simple fair procedures. O u r client again confirms that he w a s not, is not and has ever been a client of Ansbacher. O u r client never had any funds on deposit with Ansbacher nor any dealings to his knowledge with Ansbacher. W e find it hard to comprehen d that the explanations proffered by our client in respect of the two transactions referred to in the fourth paragraph of your ■preliminary conclusions were, as you described, inadequate and non-existent, respectively. In respect of the first transaction, namely the transfer of £750,000, w e refer you to our client's evidence and point one of our letter of the 13th August, m relation to the second transaction, namely the loan of £1.3 million, w e refer to our client's evidence and point two of our letter of the 1.3th August- In respect of both these transactions you have not sought to re-interview our client nor seek any other clarification or detail, yet, you are prepared to form a view which appears to ignore the fact that explanations have been offered. It is again in this context that our client takes great exception to the m a n n e r in which material w a s put to him in the interview. In relation to the Inspectors preliminary conclusions that the loans were connected to our client's offshore interest, w e wish to m a k e the following reply; our client w a s at the relevant time seeking Financial facilities to borrow m o n e y at a time w h e n he did not have the funds available. T h e inference that our client w a s borrowing m o n e y which w a s secured against funds which he either owned, controlled or had an interest in is completely inaccurate. Ou r client did not have such funds available to him either in this country or offshore. Furthermore, there is absolutely no evidence which would allow the Inspectors to c o m e to such conclusion. T h e entire basis on reaching such a conclusion would appear to be based on the significant details of our letter of the 13th August, which is used in contrast to his testimony. Again w e reiterate that had our client been afforded either a list of the questions or put on notice of the areas that the Inspectors were going to deal with, all the material contained in our letter of the 1 3 U ) August could have forwarded to the Inspectors prior to the interview. You will recall that you initially required a Narrative Statement dealing generally with the issues you raised. you. This w a s prepared and forwarded to N o criticism w a s m a d e in relation to this statement, instead our client w a s called to interview and a series of transactions w ere put to him without prior notice, All of these transactions took place m a n y years ago and our client w a s clearly at a disadvantage without having his files before him. In this regard w e respectfully point out that it appeared that the Inspectors ought to trap our client by placing this information before him without an adequate opportunity to deal with same. In this regard the Inspectors' conduct lacked the basic principles of fair procedure. This w a s pointed out by our Counsel and it is reiterated here. Our client has co-operated at all stages, and when given the areas in which further clarification w a s required, burnished details to you in our letter of the 1.3th August, and it is entirely inappropriate/ given the conduct of the interview and the m a n n e r in which it m s conducted, that, adverse inferences are being drawn in respect of our .:lient by reason of the information n o w given in our letter of the 13th August. Ou r client again reiterates that he did not have a Jersey trust or deposit at that time. T h e Inspectors s e e m to place significance in the fact that our client ;:ould not explain a charge of £500 in 1974 to the account of Guinness M a h o n Jersey Trust. With the greatest of respect it is suggested that most people would have difficulty remembering a charge of £500 five years ago let alone twenty-five years ago. In relation to the loan to Ice C r e a m Marketing Limited, this loan w a s secured by properties in Dublin, namely 47,Lawrence Avenue, Maynooth. 33, Grange Road, Rathfarnham, and This information has only c o m e to light by virtue of our client making further enquiries in light of the allegations m a d e by you. W e enclose copy documentation from Guinness & M a h o n Limited for your attention. In this regard w e await confirmation as to whether the Inspectors had sight of this documentation prior to our client’s interview. W e Crust: that, this matter will be further investigated by yourselves before reaching any final conclusion. It is again reiterated that at no time did our client have deposit s u m s heid offshore for security or trading purposes, in relation to the £45 payment on the 7th D e c e m b e r 1990, w e respectfully refer you to paragraph 4 of our letter of the 13th August, and would respectfully point out that a statement in your preliminary conclusions that this has not been explained is absolutely inaccurate. O u r client has grave concerns that the inspectors are pre-judging this issue and all issues which concern and affect him, in light of the fact that a clear explanation on this issue has been offered, and by virtue of the unfair m a n n e r in which our client has been treated as set out in this letter. We respectfully point out that during the course of the interview on two occasions, the Inspectors indicated that they had no interest in any material or connection that w a s not related to Ansbacher or C ayman. O u r client w a s not a client of Ansbacher and did not avail of the services of Ansbacher in the m a n n e r in which it has been suggested. O u r client did of course have dealings with M r D e s m o n d Traynor and relied upon his services, at the time and in the m a n n e r already set out. W e would respectfully suggest that our client's dealings with M r D e s m o n d Traynor do not m a k e him a client of Ansbacher. E ’. W V A ' i s t o t f i f c r U o t w M u l h e n A s t a t e m e n l 2 3 .1 1 .0 1 .d o c 0 0 0 / S 9 SANKfcBS Our Ref: PO'D/AC 24th February 1978. The Secretary, Ice Cream Marketing Limited, c / g Clayton Love Distribution Limited, Baanow Road, Ca'ora, DUBLIN 7. Dear Sir, .further to recent negotiations we write to confirm that we are prepared to make available to you a facility subject to the following terms and conditions; CD EOlTOlVt'! Ice Creara Marketing Limited. (2) Aaount: £80,000.00 (Eighty Thousand Pounds) - Irish £. (3) Purpose. The funds are being- made available in the form of short-term working Capital. In accordance with normal banking practice all funds advanced are repayable on demand but in any case not later than 1st February 19S0. The funds are being: granted subject to repayments being made as follows: (6) M»c. h \,tn c t:> - Drawdown: •***• s k S. ivSC £20,000.00 1st August 1978 £20,000.00 1st February 19 £20,000.00 1st August 1979 £20,000.00 1st February IS By way of Loan Account in the name of Ice Cream Marketing Limited, on -. C o n t 'd/. . , •C*»*»?naTflyrtOr'Dcjv.VCha«*m»n».Mju>X>n 0 **0y,JManajnngJ ««>»nO . C '.t o f iif * . N-otnr>*U,V.c.lov*Jnf..D.T O'Co~ortO# Secretary, C r e a m Markei i n g L i m i t e d S e c u rity : L i a*u i d i t vv Clause: C o n t i n u e d ... (2) Y o u r S o l i c i t o r s undertaking' c o n f i r m i n g that the T i t l e D e e d s of a h o u s e at 33, G r a n g e Road. R a t h f a r n h a m w i l l b e held to o u r o r d e r p e n d i n g l o d g e m e n t of t h e D e e d s b y w a y of E q u i t a b l e D e p o s i t . (3) We s h a l l c o n t i n u e t o h o l d t h e T i t l e D e e d s of 47, L a w r e n c e Avenue, M a y n o o t h as s e c u r i t y f o r the Loan now be i n g sanctioned. (4)’ We shall retain a blank transfer duly c o m p l e t e d o v e r the shar e s in C l a y t o n L o v e D i s t r i b u t i o n Limited. (5) We s h a l l r e q u i r e t h e L o a n g u a r a n t e e d b y Mr. J o h n M u l h e r n and C o n n s b r o o k P r o d u c t i o n s Limited. In t h e c a s e o f t h e G u a r a n t e e c o m p l e t e d by ' C o n n s b r o o k ’ , w e s h a l l r e q u i r e a c o p y of a Board R e s o l u t i o n c o n f i r m i n g the i s s u an c e of s u c h Guarantee. (6) W e s h a l l r e q u i r e a f o r m of Assignment completed over a L i f e p o l i c y in t h e s u m of £ 1 0 0 , 0 0 0 . 0 0 in t h e n a m e of M r , John M u 1h e r a . If t h e r e s h a l l b e a n y i n c r e a s e in t h e c o s t t o u s o f m a k i n g or m a i n t a i n i n g t h e L o a n b y an a m o u n t w h i c h we d e e m m a t e r i a l r e s u l t i n g f r o m a ny c h a n g e s in t he r e s e r v e or l i q u i d i t y r e q u i r e m e n t s to w h i c h we may be subjected, then we s h a l l be e n t i t l e d to call f o r p a y m e n t of a d d i t i o n a l interest of s u c h a m o u n t a s w e s h a l l certify as the amount required to c o m p e n s a t e f o r s u c h i n c r e a s e d cost w i t h e f f e c t f r o m the date of n o t i f i c a t i o n . R-r.H „j i l »?' * ^ -EDDY YHPFLTUil ■*<#* • ' -;xij*>*>££•?** £fefe>S" & mmm&mI 1 § *&* ft F e b r u a r y 19 7S. i«>11'ft ig - *#< i?1!rr3.d**2faji>ic.'*i jar.visxax,e« l#v _<„> " £ 4 r tU x ';t C X aU^t/r ~ ^ V Y o u s h a l l b e at l i b e r t y w i t h i n ^ o r i e month after such notification Y:0 ^ ? # Y . a a d w i t h o u t p a y m e n t of a n y p r e m i u m or p e n a l t y to r e p a y the full amount of the f a c i l i t y o u t s t a n d i n g v t o g e t h e r w i t h i n t e r e s t at the 'Y:£; rate applying p r i o r to notification, • ' d o c u m e n t a t i o n of the L o a n w e e n c l o s e : / • - , . .’.•■• ■ • ..-o»Jt>- ■ ■’. . ' ■■ ■ ■,■■■ . „,_. ,j T o ^ £ a c > l i t . ^ e # . .. .. .■vY:;^' Yvv:.;.f * .* ;^ ■ t a c x i i t y .-letter f o r s i g[■nature na by you r authorised . r e t u r n , .thereby c o n f i r m i n g a c c e p t a n c e of t h e : t h e t e r m s a s at i a ned . When ret urning same kindly ~- ■, «iive a B o a r d R e s o l u t i o n a u t h o r i s i n g t h e b o r r o w i n g . L ::i s f o r s ig n a t u r e ' the a u t h o r i s e d s i g n a t o r i e s of P r o d u o t i o n s Li: cd a n d r e t u r n , in d u e c o u r s e , ta »'-■ c o o v of a 'arc! R e s o l u t i o n a s a l r e a d y o u t l i n e d . t inn c h a •;: relative Guarantee has a l r e a d y been -'Of® .'•i.e:i by Mr Mulhern, :a3&rook U?cc!ate f o r a f o r c o m p l e t i o n ' ■■a banking; A c c o u n t . and return covering ' the ^ look forward to r e c e i v i n g the r e q u i r e m e n t s as set a s p o s s i b l e a n d in t h e e v e n t of y o u r b e i n g u n c e r t a i n ’ >■■; c t i cular a s p e e r; of tlia f a c i l i t y p l e a s e let u s k n o w . Y ou r s £ a i fch f u 1 1 ; , for C-uI'NlMESS + M A H O N L I M I T E D P. J. F l y n n , B a n k i n g fcfanager. P. 0 ‘Dwye r , Loans Officer, operation o u t , as regarding 24th February 197S Continued... completion of the security formalities as outlined. We propose charging interest on the Loan at 3% in excess of Guinness + Mahon Limited's Base Rate fluctuating therewith. The present effective rate is therefore 12% per annum and we shall advise you of any xuture upward or downward movement in our Base Rate, Interest will be debited to the Account on the 31st March, 30th June, 30th September and 31st December annually and at maturity of the Loan. W e shall apply to you immediately after the aforementioned dates for payment of interest and it is to be clearly understood that we shall expect'to receive payment of interest within fourteen days after the date on which interest is demanded. As secu rity for the Loan we shall require: (I) Your Solicitors undertaking confirming: that the Title Deeds of the following leasehold premises shall be retained to our order: (a) 92, Churchtown Road. (b) 42, Main Street, Rathfarnham. ( c 77, Francis Street. ) (d) B&llsbridge Terrace. (e) 130, Terenure Road. (£) (g) 46, North wall. Corner of Trinity Street. In due course we shall require the Title Deeds lodged by way of E q u i t a b l e D e p o s i t . Continued. , . OLAttftNXSE: THAT the Seal of the Corapany be affixed to a Deed of Guarantee whereby the Company guarantees the borrowing of £40,000 by Mr. Jcha Mulhern frcjj Cuinness & Mahon Limited. LOAN FACILITY; THAT the Coxsipa:-ii’ ceyt a loan f a c ilit y in the sum of £80,000, say Eighty Thousand Pounds > from Guinness & Mahon lim ited on the terms and conditions s a t out. in. the Bank’ s f a c i l i t y le tt e r of the 1st March 19/8 and that Mr. John Mulhern be authorised to sign a copy o f the said f a c i l i t y le tt e r accepting the loan on behalf of the Company . C ertified a.? true and exact. M *A U dated th is 22nd day off > ,,£973 (£5?3 CONNSBROOK PRODUCTIONS LIM ITE D EXTRACT of the resolution of Directors passed pursuant to the A rtic le s of Association on the 7th day of March 1978. GUARANTEES: THAT the Seal of the Company be affixed to the following forms of Cuarantee: No. 1 A Deed of Guarantee whereby the Company guarantees the borrowing of £80,000 by Ice-Cream Marketing Limited from Guinness & Mahon Limited. No. 2. A Deed of Guarantee whereby the Company guarantees the borrowing of £40>000 by Mr. John Mulhern from Guinness & Mahon Limited. C ertified as true and exact. ICS-CRSAM M&3K3TING LIM ITE D R e s o lu tio n o f D i r e c t o r s passed pursuant; t o th e A r t i c l e s o f A s s o c ia tio n o f th e Coepany on the 7th M arch 1378. RESOLVED-. LOAN F A C IL IT Y TE A T the Company a c c e p t a lo a n f a c i l i t y i n th e sum o f £<30,000, s a y E i g h t y Thousand Pounds, from G u in n e s s & Mahon L im ite d on th e fceras and c o n d itio n s s e t o u t i n th e Bank’ s f a c i l i t y l e t t e r o f th e 1 s t March 1978 and t h a t M r. John M u lh e m be a u th o ris e d to s ig n a co p y o f th e s a id f a c i l i t y l e t t e r a c c e p tin g the lo a n on b e h a lf o f th e Cerspany. Dated t h i s 7 t h d ay March 1978» Jamas O 'M eara C E R TIFIE D A TRUE COPY Jo h n M u lh e m faui?f?. 4.31.#45ah?? .. . >61"23.1w .21. . . . . . kin. . 359v.- . w: . Fi?d? a \W??21:. :n 2,117?: G u a r a n t e e By Individuals), Partnership or Compariy(ies) T o Guinness H- IVlahon Limited (hereinafter called "the Bank" which expression shai} include and extend to their successors and assigns) Us'fdwj taking / v / W >u r 'c 1. th e . s t o r n e r i s i n banking facilities to....................................................................................... m m e s of *' A 'T t 'it i.'j -u < 1 e m o IN CONSIDERATION of the Bank making or continuing advances giving time for payment or otherwise granting credit or affording J^r-lcsjx^ f i n i s — vv'^rfS a , a m Customer” ) t h e o r (hereinafter called "the .................................... .......................................................... i s L uJ Z A p a r t n e r s h i p . • ................................................ //./£/M3 X > i k .-A \-V;: \] f- jt f iligig^if? f® i :xe •if' .sl. ,:-r’■»;' ’ .-*;■••■>] -S;»tjW *$!i & m m B m w & r i ‘ 14:2:-: FROM RFl'HY L Ff.M HQ MIGHT TO b u a ra n t e e By Individual fs), Partnership or Company(ies) T o Guinness + Mahon Limited (hereinafter called the Bark" which expression shall include and extend to their successors and u n d e r t a k in g the u -;t o r r u )r i s 1- IN CONSIDERATION of the Bank making or continuing advances giving time for payment or otherwise granting credit or affording i n .sfUairship nr-mes of F-.-utnem of r>-jae name banking facilities to...................................................................................... _X*C^ M A *1^ O r L * , t M r ’T ^ £ j ^ .............................................................................. (hereinafter called “the 't 'e r f : ‘* w a ■ p m n w m t Customer”) e o r ................................................................................................. is o r s h i p •Hr: urade name /V I U .............................................................................. (hereinafter called "the Guarantor”) HEREBY UNDERTAKES upon demand by the Bank to pay and satisfy to the Bank all moneys which are now or shall at any time hereafter be due or owing to the Bank on any account and in any manner whatsoever by the Customer whether as principal or surety and whether solely or jointly with any other person or persons and to ■discharge on demand all other liabilities certain or contingent incurred by the Customer or for which he may be liable to the Bank in respect of acceptance or documentary credits discount facilities currency and any other transactions howsoever and all liabilities by way of guarantee or indemnity undertaken to the Bank by the Customer together in all cases with interest (as well after as before judgement) charges commissions expenses legal costs and charges pertaining to or occasioned by this or any other security the Bank may hold for the aforesaid moneys and liabilities PROViDED ALWAYS that the total amount recoverable from the Guarantor hereunder shall riot exceed the sum of ... . In addition to {(} such further sum for interest on that amount or on such less sum as may be due or owing (and also all Bank charges in respect thereof) as shali have accrued due or shall accrue due to the Bank within six months before and at any time arrer either the date of demand by the Bank upon the Guarantor for payment or the date of the deteimination of this Guarantee pursuant to any notice of determination as hereinafter provided and (ii) ail costs arid expenses recoverable from the Customer and all costs and expenses (on a full indemnity basis) arising out of or in connection with the recovery by the Bank of the moneys due to the Bank under this Guarantee which the Guarantor hereby agrees to pay. Interest accruing due to the Bank under (i) above after the date of demand or determination of this Guarantee as herein mentioned shall be calculated at .......... .............................................................................. The certificate of an officer of the Bank as to the amount of the said moneys and liabilities shall be conclusive for all purposes. This Guarantee shall be construed and take effect as a Guarantee of the whole of the said moneys and liabilities and until they shall have been patd discharged and satisfied (arid they shall be deemed to be due and owing notwithstanding the bankruptcy insolvency or liquidation of the Customer) the Guarantor agrees that the Guarantor shall not take steps to enforce any right or claim against the Customer in respect of any moneys paid by the Guarantor to the Bank hereunder and shall have no right of proof in such bankruptcy insolvency or liquidation in competition with the Bank notwithstanding any payment of the whole or part of the sum for which the Guarantor may be liable nor any other right of a surety discharging his liability AN D if this security snail from any cause whatsoever cease to be binding upon the Guarantor or the Guarantor's legal personal representatives as hereinafter provided the Sank may without prejudice to its rights hereunder open a fresh account or accounts and continue any existing account in the name of the Customer and may appropriate to any such fresh account any moneys thereafter paid in received or realised for the credit of the Customer without being under any obligation to apply the said moneys or any part of them in discharge of any indebtedness or liability of the Customer to the Bank and if the Bank shall fail to open such a fresh account it shall be deemed to have done so with rhs effect that the said moneys shall not operate to reduce the said indebtedness or liability at the time this Guarantee so ceases to be binding as a continuing security. This Guarantee shail be binding upon the Guarantor and the executors administrators or other legal personal representatives of the Guarantor as a continuing security until the expiration of three calendar months from the time of receipt by the Bank of notice given in writing by the Guarantor or the Guarantor's said representatives or any of them to determine the same and shall not be considered as satisfied by any intermediate payment of the whole or any part of the moneys due or owing to the Bank by the Customer but shall extend to cover all such moneys as shall be due or owing or accruing due or owing at the time at which such determination shall take effect and shall further extend to cover any cheques, orders for payment drafts, bills, notes or other negotiable instruments drawn, made endorsed or accepted by or for the account of the Customer on the Bank and purporting to be dated before the expiration of such notice although not paid or honoured by the Bank until after such expiration. Notwithstanding the foregoing provisions regarding termination of this Guarantee by the Guarantor giving to the Bank three months written notice, in the case of an advance to the Customer being repayable at a fixed date no such notice shall take effect until the day next succeeding the date upon which ail the moneys and liabilities hereby secured shou'd have been fully paid, discharged and satisfied by the Customer in accordance with the terms of this Agreement with the Bank. No assurance security or payment which may be avoided under any enactment relating to bankruptcy or under the provisions of any other statute affecting the Customer or his affairs and no release settlement or discharge given or made by the Bank on the faith of any such assurance security or payment shall prejudice or affect its rights to recover from the Guarantor to the full extent of this Guarantee including any moneys which the bank may be compelled by due process of law to refund to the Customer in liqudiation or a liquidator pursuant to any such enactment or statute and any costs payable by the Bank pursuant to or otherwise incurred in connection with such process, in the event of the death bankruptcy or liquidation of the Customer the Guarantor's liability hereunder shall extend to all sums which would at any time have been owing to the Bank by the Customer if such death had occurred or such bankruptcy or liquidation had commenced respectively at the time when the Bank receives actual notice thereof and notwithstanding such death bankruptcy or liquidation. This Guarantee shall be in addition to and not be prejudiced by any other Guarantee or security now or hereafter held by the Bank for all or gny part of the moneys and liabilities hereby secured nor shall any other such security or the liability of any person not a party hereto be in any way prejudiced by this present security AN D so long as any moneys are due or owing hereunder the Bank shall have an immediate right of ser off in respect of all moneys standing to the credit of the Guarantor with the Bank on any account whatever and a lien over any securities or other property of the Guarantor held by the Bank whether for safe custody or otherwise. To the extent that any payment made by the Guarantor hereunder may be subject to taxes, duties, levies, imports or charges imposed in respect of such payment to any authority of the Republic of Ireland or other Country state or other political division by means of deduction at source, the Guarantor will in such event pay to the Bank such additional amount as may be necessary to ensure that the Bank receives the full amount due to it in accordance with the foregoing provisions of this Guarantee. The Guarantor has not taken and will not take from the Customer any security whethei personal or forming a charge on property of the Customer for the moneys and liabilities hereby secured such as might oh the bankruptcy insolvency or liquidation of the Customer resuit in any diminution in or prejudice to the security herein and the Guarantor UNDERTAKES that any such security now or hereafter held by the Guarantor shall be held in trust for the Bank and for its benefit in respect of the obligations of the Guarantor hereunder. W ITH O U T PREJUDICE to this security the Bank may without the knowledge or consent of the Guarantor determine reduce or increase any credit or facility or compound with grant time or other indulgence to or renew any bills of exchange or notes for the Customer or to or for any ether person whatsoever or deai with exchange release modify or abstain from perfecting or enforcing any security or other Guarantee or right which the Bank now has or may hereafter have against the Customer or any such other person. Without prejudice to the generality of the foregoing, the Bank shall be at liberty but not bound to resort for its own benefit to any other means of payment at any time and in any order the Sank rnay think fit without thereby diminishing the habiiity of the Guarantor and the Bank may enforce this guarantee either for the payment of the ultimate balance after resorting to other means of payment or for the balance due at any time notwithstanding that other means of payment have not.been resorted to and in the latter Cass without entitling the Guarantor to any benefit from such other means of payment so long as any monies remain due from the Customer to the Bank. ig n m e n t 10. The Bank may at its absolute discretion without the consent of the Guarantor and without notice to the Guarantor ASSIGN the debt and liabilities hereby secured and the rights and benefits embodied in this Guarantee together with any securities of the Guarantor held by the Bank in support thereof or otherwise to any person or persons firm committee association or other unincorporated body or to any limited company or corporation whatsoever and the Guarantor agrees that the Guarantor and the executors administrators or other legal personal representatives of the Guarantor shall be bound to any such assignee in like manner and to the like extent as the Guarantor is bound to the Bank hereunder. pense ount • 5caa The 3ank is to be at liberty without prejudice to any other rights it might have at any time and from time to time to place and keep for such time as the Bank may think prudent any moneys received recovered or realised under or by virtue of this Guarantee to or in a separate or suspense account as the Bank shall think fit without any intermediate obligation on the Bank's part to apply the same or any part thereof in or towards the discharge of the moneys due or owing to the Sank by the Customer. 12. ANY DEM AND made or notice given hereunder shall be deemed to have been properly made or given if sent by prepaid letter post to the last address of the Guarantor known to the Bank and shall be deemed to nave reached the Guarantor in the normal course of post notwith­ standing that the same be returned undelivered and notwithstanding the death or the Guarantor, 13* Where the Customer is in joint account this Guarantee shail be effective and enforceable against the Guarantor notwithstanding the death of one or more of the joint account holders and when the Customer is .-a firm committee association or other unincorporated body or a limited*, company or corporation this Guarantee shall be construed and taker^ effect as a Guarantee of all moneys due or owing by such firm and every- member thereof or by such association committee or other unincorporated body and in such case and in the case of a limited company or corporation in spite of any defect irregularity or insufficiency in the borrowing or in the capacity or borrowing powers of the Customer or in the exercise thereof such moneys shall be recoverable from the Guarantor as if the Guarantor was the principal debtor AN D FURTHER this Guarantee shall in the case of a firm be a Guarantee of all moneys due or owing on any account of all persons carrying on the business of the said firm notwithstanding any change in its constitution AMD in the case of a limited company the liability of the company and the security herein shall continue notwithstanding any absorption amalgamation or other change in the constitution of the company AND FURTHER this Guarantee shall be a security for all moneys due or owing in respect of debentures or debenture stock of the said company or other corporation of which debentures or debenture stock the Bank is a holder AND such of the provisions hereinbefore contained as shall be primarily and literally applicable to a single individual Customer shall be construed and take effect in respect of moneys and liabilities owing or due by such limited company as identical with or analogous to that construction and effect which they would have in the case of a single individual customer and lastly where the Customer is an infant or a person otherwise legally incapable of contracting or where for whatsoever reason the principal debt shali be unenforceable the undertaking of the Guarantor herein shall be construed take effect and embody the full indemnity of the Guarantor as a direct or primary security. Where the Guarantee is executed by more than one person the Agreements and obligations on the part of the Guarantor herein contained shall take effect as joint and several Agreements and obligations and all references to the Guarantor shali take effect as references to the said persons or any of them and none of them shall be released from liability hereunder by reason of the Guarantee ceasing to be binding as a continuing security on any other or ethers of t.ham and where the Guarantor is a limited company or corporation this Guarantee shall take effect and be binding on the said company or corporation notwithstanding and absorption amalgamation or other change in its constitution. So far as may be necessary to give effect to the provisions of this Guarantee, the Guarantor waives in favour of the Bank all rights which but for this waiver the Guarantor might exercise or enforce against the Bank or.the Customer. The Guarantor agrees that in the event of the Bank taking proceedings hereunder the Sank may in its absolute discretion bring them in the Court;; of the Republic of Ireland or any other Country which it may deern suitable and for the purposes of those proceedings the Guarantor hereby submits to the jurisdiction of the chosen courts and agrees that any writ notice judgement or other legal process or document relating to such proceedings may be served on the Guarantor by delivery to or service on him or his agent in the Republic of Ireland being or elsewhere as the case may be. This Guarantee shall be construed and fake effect according" to the law of the Republic of Ireland in force at the time any such proceedings are begun. In this Guarantee where the context so admits words denoting the singular number only shall include the plural number also and Vice versa. Words denoting the masculine gender only shall include the feminine gender also and words denoting persons only shall include companies arid this Guarantee shall be construed and take effect accordingly. Definitions 16- motes 17. The Marginal notes are for the purposes of reference only and shall not in any manner affect or restrict the interpretation of this Guarantee. 18. This Guarantee is and will remain the property of the Bank. f " * -' SIGNED, SEALED &■ DEUVERE by the said In the Presence o f - SIGNED, SEALED & DELIVERED by the said in the Presence of:-- PRESENT when the COM M ON SEAL of was hereunto affixed:TOThL p . A ppendix X V (94) M r Jam es M urray, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r James Murray. a) Extract of transcript of evidence of M r Jack Stakelum dated 8 November 2000. b) Letter of 18 October 2000 from Inspectors to M r Jack Stakelum. c) Letter of 6 November 2000 and enclosure from M r Stakelum to Inspectors. d) Letter of 21 February 2001 and enclosures from M r Stakelum to Inspectors. e) Internal Guinness and M a h o n credit committee m e m o of 25 M a y 1977. f) Internal Guinness and M a h o n minute of 28 October 1977. 23 147 24 Q. When did that start? A. I am inclined to believe 1976 but it might have been 25 1977. 26 I only had one year of operations in 1975. 27 148 Q. I would have started on my own in late 1975. Would you tell us what the arrangement in a general 28 way was with Mr. Traynor. 29 operated? How was this service A. 1 If I can take a typical example, a client may have 2 asked me to look after funds that in almost all 3 cases that I am aware of were already abroad. 4 I would have asked Mr. Traynor to advise me where 5 the funds might be transferred to, and then the 6 client would issue instructions when I got the 7 tracking route or account name or code or whatever 8 they might be. 149 9 10 Q. Could you not be a little bit more specific because you know these terms, I don't know. . Would you mind explaining them to us? 11 A. 12 If the client wished to place the funds with me and 13 they were in some Royal Bank of Scotland in Jersey 14 or wherever. 15 150 16 17 151 18 Q. This is client's of yours? A. Yes. Q. Why would they want to place their funds with you? A. They might be unhappy about monitoring the funds in the sense of what interest rate...(INTERJECTION). 19 20 152 21 22 153 Q. But you were not a bank? A. No. Q. They were asking your advice as to where to put the 23 funds? 24 A. 25 26 They were asking me whether I could monitor those funds on their behalf. 154 Q. Monitor is a word you use; I don't understand it. 27 Your clients have funds and they come into you. 28 What do they ask you to do? 29 A. They would say 'We have funds offshore' wherever 1 they might have been 'Can you look after these funds 2 for me.1 3 155 Q. "Can you look after these funds." What did that mean? 4 A. 5 Would you endeavour to get the best interest rate. Would you monitor the funds. 6 Take it slowly. Would you endeavour to get the best 8 interest rate. Were they asking you to change 9 where their funds were into some other financial 7 156 Q. 10 institution? A. 11 I don't think they would come in and say 'We have 12 funds. 13 financial institution.' 14 have arose with them that they would have advised me 15 that they had £X in funds and say 'Can you look 16 after these funds on my behalf.' 17 157 18 Will you change them for some other I think a discussion would Q. What does that mean? A. It means that they might not want to correspond 19 directly with whatever foreign bank they were using. 20 They might not want to get mail received from 21 foreign banks on the basis of monthly statements. 22 They wouldn't feel that necessarily competent about 23 looking at whether the funds should be placed 24 one month or three months or six months. 25 they would like me to look after those factors. 26 27 158 And that Q. What did you do then? A. I would probably advise them at some stage that 28 there would be a facility available through 29 Guinness & Mahon. 1 159 2 3 160 Q. You then contacted Guinness & Mahon? A. Yes. Q. You used the word "facility." in this connection? 4 A. 5 It means I would probably have contacted 6 Des Traynor. 7 — 8 were — 9 by me.' 10 What does that mean 161 Q. I would have said 'I have a client for the most part he wouldn't know who my clients that wishes to have funds monitored abroad Don't used the word "monitored" because I don't 11 understand what it means. 12 What is he to do? 13 A. You have a client. Des Traynor is to give me an account number, a 14 reference, a bank where the client who would have 15 the funds would have to give instructions to his 16 bank to have the funds moved. 17 I don't understand these things either — 18 moved to a receiving bank. 19 162 Q. This is very important. Those funds — If you don't understand it, 20 I understand even less. 21 client with funds in Jersey. 22 that this client is dissatisfied. 23 Mr. Traynor then do? 24 A. might be Let us take a typical He gives me coded references. You tell Mr. Traynor What does I don't remember but 25 it might well be a reference to a bank account in 26 London for so and so, for the account of so and so. 27 28 29 163 Q. What was the bank? A. Mr. Costello, I don't remember and I am sure those instructions would have varied over the years. 1 164 Q. What was the account, in whose name was the account to be placed? 2 3 A. I have a difficulty answering that question, not 4 wanting to be uncooperative. 5 that Mr. Traynor would be seeking to get the funds 6 under his control and there is a transfer process. 7 165 Q. All I am saying is You must have known the financial institution in which your clients's funds were going to be placed? 8 9 A. The only answer I can give to that is I don't recall 10 because over the years they probably used different 11 financial institutions. 12 166 Q. Tell me some of them that were used that 13 Mr. Traynor would have told you about. 14 names of some of those, Mr. Stakelum? 15 A. Give me the It is very difficult under oath, but let us try 16 Guinness & Mahon London for a start. 17 But if it was Guinness & Mahon London, it would 18 probably be account of so and so, reference so and 19 so etc. etc.. 20 that. 21 If it was dollars it might be something else. 22 167 Q. I don't know. But I am not absolutely positive of It could also vary depending on the currency. What other financial institution did he tell you that the money was going to be deposited in? 23 24 A. I don't know, I just don't know. It would be a 25 once-off instruction. 26 would depend on where the funds were coming from 27 too. 28 29 168 Q. I don't know. It probably Do your best. I am sure you are under strain, Mr. Stakelum. Tell me the numbers of other 34 1 institutions that clients of yours had money 2 deposited as a result of your contact with 3 Mr. Traynor? 4 A. 5 6 That is not wanting to be uncooperative, I just cannot remember. 169 7 8 I just cannot answer that. 170 Q. Why can’t you remember? A. How do I answer a question of why I cannot remember? Q. For example, were any of the funds lodged in any of 9 the Guinness & Mahon subsidiaries in Cayman or in 10 the Channel Islands? A. 11 I don’t think so. But I think the funds would be 12 initially lodged somewhere maybe for the account of 13 Guinness Mahon Cayman, reference number so and so, 14 maybe for the account in Guinness & Mahon London for 15 Guinness & Mahon Dublin. 16 You would get specific instructions. 17 171 Q. I am not too sure. It may have been the account of Guinness & Mahon in 18 Dublin or Guinness 6 Mahon in London. 19 offshore bank we are talking about, Guinness & Mahon 20 Cayman Trust, the Ansbacher bank. 21 been lodged in its account in Dublin or lodged in 22 its account in London? 23 24 172 25 26 173 Was this the They would have A. It may well have been, I don't remember. Q. But you are under oath now? A. That's right. Q. You are under oath. Can you say that funds your 27 client had asked you in relation to assistance were 28 lodged in an account in the name of Guinness Mahon 29 Cayman Trust in Dublin or in London? 1 A. I cannot remember. I suspect that some of the 2 instructions given at the time would be what was at 3 the best requirements of the Guinness & Mahon bank, 4 what their internal ...(INTERJECTION). 5 174 Q. A few minutes ago you to said to me that you gave 6 Mr. Traynor instructions and that you transferred 7 funds to him and they were transferred offshore, is 8 that not right. 9 minutes ago? 10 A. 175 13 14 They were probably offshore already. I thought we were talking about a client...(INTERJECTION). 11 12 Didn't you say that to me a few 176 Q. They were offshore already you think? A. Yes, most of the funds were offshore already. Q. All the funds of these clients we are talking about 15 were offshore. 16 to you with funds that weren't offshore? 17 18 177 19 Did you ever have clients coming in A. Yes. Q. What would happen then? A. At different stages, in the early stages I think 20 Irish pounds could be converted without any problem 21 into Sterling. 22 1970's. 23 178 24 25 26 179 It is one and the same in the Then-they could be moved from Sterling. Q. Were they put offshore, the funds? A. Yes. Q. Where? A. All I know is that with Des Traynor I would have 27 assumed Guinness Mahon Cayman Trust, later 28 Ansbacher. 29 College Trustees or Guinness & Mahon Guernsey. But it could well have been r 1 180 2 3 181 Q. One or the other? A. Yes, I assume one or the other. Q. Did any of your clients to your knowledge establish 4 trusts with the assistance of Guinness & Mahon with 5 Mr. Traynor either in the Cayman Islands or in the 6 Channel Islands? 7 8 182 9 10 183 A. Not to my knowledge. Q. None of them told you that they had done this? A. No. Q. Mr. Traynor didn't tell you that he was going to suggest this to them? 11 12 13 184 A. No. Q. You are pretty certain on that or are you doubtful 14 about it? A. 15 I am not aware certainly of any clients that 16 established such trusts. 17 that did. 18 185 Q. 20 22 If they didn't establish trusts, you are aware of 186 A. Yes, that's right. Q. We will break now for a cup of coffee, Mr. Stakelum, for about ten minutes or so. 23 24 25 26 27 28 29 ' clients who transferred funds offshore? 19 21 I am not aware of any SHORT ADJOURNMENT 18** October 2000 Mr. Jack Stakekun “Fairmont” BaUyronan Road Kflpcddcr Co. Wicklow Strictly Private A Confidential -A ddressee Only . . Dear Sir I refer to your letter o f 11 October 2000, and I reply on my own behalf, and on behalf o f my colleagues, Mr. Justice Dedan Costello and Mr. Paul Rowan. # We now wish to examine you under oath concerning the matters set out in our two letters dated 30 August 2000 and 21 September 2000. To that’end, I propose that an interview would take place in our offices at the above address, either on Wednesday 8 or on Thursday 9 November, at 10.00 a.m. Perhaps you would make contact with our secretary, Ms Frances Gaynor at the above phone number to confirm either date, or to make mutually convenient alternative arrangements if those dates do not suit you. We note your refusal to provide us with names of your clients prior to examination. I must point out to you that you are obliged by law to provide us with the information w e have required of you. In that regard, I refer you to Appendix B o f our two letters, which sets out our statutory powers. You w ill note that section 10(5) of the Companies Act 1990 imposes a duty upon you to comply with our requirement, and, in the case o f a refusal to do so, m&es provision for the matter to be dealt with by the High Court I therefore repeat our requirement that you provide us with the names and addresses o f those clients who you may have advised in relation to trusts in the Cayman or Channel Islands, or in relation to the transfer o f fimris to eilher o f those islands. We require this information to be provided in writing prior to the interview. We have noted also your expressed intention to argue at interview that it would be invidious to disclose the identity o f your clients. Once again, I must point out to you that you are obliged to do so, in compliance with our requirement The interview is not the proper forum in which to make submissions, and it is not our practice to entertain them. Yours faithfully J S JA C K ST A K E L U M CHARTEREDACCOUNTANT “FAIRMONT" BALLYRONAN ROAD TELEPHONE: 2810646 FAX: 2810645 MOBILE: 0872854660 KILPEDDER CO. WICKLOW The Inspectors V* Floor Trident House Blackrock u s r ao* 9 - CO. 6 November, 2000 Dear Sirs, With reference to your letter o f the 18* October, and in particular the third paragraph, I should point out that I did not reflise as such to provide the information in question, merely that I should be afforded the opportunity to argue why I should not be asked to divulge such informatioa The persons in question dealt with me on an understanding o f confidentiality, and as the Inspectors will surely appreciate, it is difficult not to honour that confidentiality, particularly when one has been used, over one's professional life, to honouring the confidentiality of Clients. " However, as you point out forcefully in your letter, you are not prepared to allow me that opportunity and you have referred to die legal position. In the circumstances, I attach a list of the names and addresses of the persons in question. Yours fhhhfUlly, End: B ic u m t e : te rn - n James Mnrray, Hadley, Coast Road, Momington, Co. Meath (now deceased). ( ) JOHN J. STAKELUM “Fairmont” BaUyronan Road, Kilpedder, Co. W icklow. 21 February 2001. The High Court Inspectors, 3rdFloor, . Trident House, Blackrock, Co. Dublin. ’\*e ' rr & m m Re: Interview s w ith the Inspectors on 8/11/2000 and 6/12/2000. Dear Inspectors, The content In sections 1 and 2 has been written in order to add clarification to the information given in m y Statement dated 22 September 2000. 1. T he Consultancy Business I set op in 1975. In December 1975 I decided to set up a business that would provide a general financial Consultancy service to clients. I bad identified the market need in Haughey Boland & Company during my auditing work but more particularly during ray receivership, liquidation and financial restructuring experience. The services I decided to fbcus on 'were: - • • • • • • • • • Preparation o f properly assembled requests for financing from banks. Preparation o f w ell constructed projected cash flow and profit and loss statements. Accompanying clients at meetings with their bankers. The presentation o f meaningful management accounts and the procedures within businesses for the tim ely production o f them. Being a sounding board for all kinds o f operating issues - both problems and perceived opportunhtes. Guidance on where to go and how to request professional services. Helping businesses in difficulty to get back to profitability or to move logically to receivership or liquidation. ■ Acting for clients in the purchase or sale o f businesses. Acting in a non-Executive Director capacity when requested to do so. Those were the principal service headings under which I operated in the name o f Business Enterprises Limited from December 1975 until my retirement on the 31 October 1998. This business was busy, demanding and successful. Typically, it occupied well over 100% o f 50hour weeks. 2. The service I gave to persons who wished to hold Hands offshore. Involvement with the savings o f clients in any o p acity whatsoever was not envisaged in my original plan. When in due course I agreed to provide a service I required that it be on a minimalist basis. Towards this my stipulations were: • Funds would be deposited in licensed banks at rates o f interest that would be competitive and market related. This empowered depositors to be satisfied concerning both safety and interest rates. • A ll decisions in relation to movements in these funds would be conveyed to me directly and orally by the person concerned; ® I would undertake no advisory or management role in relation to these funds and this fact was communicated to each person with particular reference to decisions that concerned the buying or selling o f investments. • • • I would neither issue nor obtain.receipts for movements in funds. Neither would I keep any ledger recprds, issue statements or engage in correspondence. Information in relation to balances and rates o f interest would be provided on an oral basis only. Originally, no charge was envisaged for this service but over time it became necessary to recover costs on a case by case basis. My operating procedure for this service had but four components: •• -• • ■ • A deposit Bccmmt in GAM that I have described as a hotchpotch account A manual memorandum record I kept in my office under my personal control A float account in AIB. A monthly reconciliation o f the sum o f the memorandum records with the sum o f the account(s) in G&M and any float balances. In the interest o f completeness perhaps I should add also: • • • • G&M would be aware o f the total funds I had in my hotchpotch account G&M would not be aware o f the names o f the depositors whose funds, in aggregate, comprised the balance in the hotchpotch account albeit that a name and an amount could surface as part o f another business transaction with the bank, e.g. a back-to-back ban. Some o f my clients would be aware generally that the fbnds they held offshore were in a G&M vehicle. Other clients would be aware that their funds were offshore but would have no awareness or care about the name o f the bank in which their money was deposited. Only I knew the names in the memorandum account and only I knew the ownership o f the balance in the float account kept in ABB. 5. The inform ation requested by M s. M ackey on the 6 December 2000. The information requested by M s. Mackey on 6 December 2000 is given in the three schedules that are appended to this letter. Schedule 1 relates to the list o f **«»»«» I sent to the Inspectors on 6 November 2000. schedule had offshore deposits in G&M through m y procedure. Yours sincerely, A ll on tins James Murray. Yes. B a c k to D a ta D e p o s it B ack k m O p sn o d Poiaibly. Late 1070s. Date Oopodt Ckxad Source of Funds Offshore Sourca of Fund* Irtah Pounds. a 1987/88. All. None. w ? . Janos Murray, Esq: Amount:;, £75,000 Purpose: Purchaw o f farm. Term: For a period of one year Rate: 15*% fixed Drawdown: On completion of documentation Security: Title Deeds o f Farm. (S ollctan undertaking meanwhile). 31A *B . “SulhAly Sieurod*. Review; Recommended. J ^ Minutes of the 149th Meeting of the Banking/ Credit Committee held at 17 College Green, Dublin 2 , on Friday 28th October, 1977. PRESENT: J . D . T. - M. E. O'K. - M. J . P. - R. D. C . - GMbC . - P. J . F. P. O 'D . - M. C . K. - BMcL. - 1 . W . K. FOREIGN EXCHANGE: The £ standi at 1.77^ against the U.S.S 612: James Murray, Eiq: — ir— ■— — ■ ■■ Amount: £75,000 Pbipase^ Purchase of farm Term: Repayment o f £15,000 at end o f October, 1978. Rate: 1% over G+M Base I .e . 10%fixed Drawdown: By way of loan In name o f Janes Murray Security; * "Suitably Secured" security. Recommended. r l Deeds of farm available as » A ppendix X V (95) M r W illiam Navan Snr 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r William Navan Snr. a) Note of telephone attendance of 3 M a y 2001. b) Letter of 19 September 1990 - Ansbacher Limited to Guinness and Mahon. Telephone Attendance N a m e: Amanda Navan D a te : W ednesday 2nd May, 2001 at 12.00 noon approx. Ref: C/NOl/MLC/mf Ms. Navan telephoned me as a result of my letter of 1st May which she received this morning. She explained to me that her father William J. H. Navan had died on 16th September, 1990. She told me that herself and her brother had opened an account in their names, namely William S. Navan and Amanda Navan in the Northern Bank in Portadown to deal with their father’s funeral expenses. She confirmed that the account referred to can only be that account in die Northern Bank in their names. She then explained that her brother had been killed in an accident some ten months after their father’s death. She told me she has no recollection of this payment and she did not have any connection with Guinness & Mahon Dublin Limited and Guinness & Mahon Belfast Limited but that she did have a cousin in Dublin who was not in banking but in business. I explained to her that I would have to discuss the information which she had furnished with the Inspectors and that I would revert to her should they require any further assistance. Mary Cummins, Solicitor to the Inspectors. Thursday, 3rd May, 2001. V '•» ^ t Ansbacher Limited A Utm ber o f ih t Htnry Anbathtr H oU tinfi F L C M m to i/ Banking Group Please reply to: 42 FitzwiUiam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 P.O. Box M7, Grand Cayimn, McWi W «t Indict Phone (S09) 949-4653/4 Telex: CP 4303 Fix: (M9) 949-7946 • (809)949-5257 19th Septem ber, 1990, M. D a v id H u m p h rie s , E s q ., S e n io r Manager - O p e r a t io n s , G uinness & Mahon L im it e d , 17 C o lle g e G re e n , DUBLIN 2 . Dear D a v id , C o u ld yo u p le a s e a rra n g e t o l e t me have a d r a f t f o r S t g . £ 5 , 0 0 0 . 0 0 p a y a b le t o Amanda and W illia m Navan and d e b it A nsbacher L im it e d A c co u n t N o . 13154602. As I w o u ld l i k e t o have th e d r a f t c o lle c t e d tom orrow m orning I am s e n d in g a copy o f t h i s l e t t e r t o you b y fa x and w i l l have th e o r i g i n a l o f th e l e t t e r d e liv e r e d i n th e m o rn in g . Yo urs s i n c e r e l y . J .D . Tra v n o r. THE HIGH COURT IN THE MATTER OF THE COM PANIES A C TS 1963 to 1990 AND IN THE MATTER OF PART II OF THE COMPANIES A C T 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LIMITED (formerly GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED and CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) R e p o r t A A p p o i n t e d f f a i r s o f o f t o t h e In s p e c t o r s E n q u i r e A n s b a c h e r i n t o t h e ( C a y m a n ) L i mited Published by Order o f the Court made on 24 June 2002 V olum e [ i o ]: A p p e n d ix X V (9 6 ) to X V (lll) ISBN 0?7557?1355?9 Government of Ireland 2002 Appendix XV (96) Mr Maurice Neligan and Dr Patricia Neligan 1. 2. Ev idence relied u p o n b y the Inspectors in arriving at the conclusion relating to M r M a u r i c e Neligan a n d D r Patricia Neligan. a) Transcript o f evidence of M r M a ur ic e Neligan dated 10 February 2000. b) Transcript o f evidence of D r Patricia Neligan dated 11 February 2000. c) Letter o f 12 S e p t e m b e r 19 86 - Guinness a n d M a h o n to M a u r i c e & Patricia Neligan. d) Internal Gu in ne ss a n d M a h o n m e m o dated 17 S e p t e m b e r 1 9 8 6 f r o m Pat O ’ Dwyer. e) Gui nn es s a n d M a h o n statement of 11 D e c e m b e r 1 9 8 6 re Patricia Neligan. f) G uin ne ss a n d M a h o n statement o f 2 0 N o v e m b e r 1 9 8 6 re G M C T / C o l l e g e . g) C o p y statement - A n s b a c h e r Limited/College o f 18 April 1989. C o r r e sp on den ce received f r o m or o n behalf o f M r M a u r i c e Neligan. a) Letter o f 10 D e c e m b e r 2 001 - Lavery Kirby Gilmartin Solicitors to Inspectors. b) Letter o f 21 D e c e m b e r 2 001 - Lavery Kirby Gilmartin Solicitors to Inspectors. c) Letter o f 7 January 2 0 0 2 - Lavery Kirby Gilmartin Solicitors to Inspectors. UNDER OATH ON THURSDAY, 10TH F E B R U A R Y 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. MAURICE NELIGAN Represented by: Mr. John Lavery Lavery Kirby & Co Main Street Blackrock Co. Dublin WITNESS EXAMINATION MR. MAURICE NELIGAN MR. ROWAN M S . MACKEY MR. JUSTICE COSTELLO QUESTIONS 1 - 7 1 72 - 122 123 - 155 1 2 3 4 MR. JUSTICE COSTELLO: 5 We will start our interview now. I am 6 Declan Costello and on my right is Ms. Mackey and on 7 my left is Mr. Rowan, and we were appointed, as you 8 know, by the High Court as Inspectors. 9 is our solicitor and she will administer the oath 10 Ms. Cummins now to you. 11 12 MR. MAURICE NELIGAN, HAVING BEEN SWORN, WAS EXAMINED 13 AS FOLLOWS BY MR. ROWAN 14 15 1 Q. 16 A. 17 2 Q. MR. ROWAN: Good morning, Mr. Neligan. Good morning. Mr. Neligan, we wrote to you inviting you to come 18 for this interview and we suggested it might be 19 helpful if you were able to provide us with a 20 statement and supporting documents. 21 A. 22 3 Q. 23 A. Yes. You have not done so? No. I did not receive your letter until early 24 January, and I then got on to Mr. Lavery and my 25 accountants, Woods & Co., to prepare the relevant 26 statements and get them back to you. 27 here to explain that I had done this and I was told 28 to bring it along, if necessary, and to try to get 29 it in beforehand if I could. I also rang Now, one of the 1 r e a s o n s it h a s b e e n q u i t e d i f f i c u l t is b e c a u s e w e 2 h a v e h a d s o m e d i f f i c u l t y in g e t t i n g a l l t h e r e l e v a n t 3 i n f o r m a t i o n f r o m the bank. 4 l e t t e r of a u t h o r i t y to Mr. W o o d s w a y b a c k in 5 September, to g e t a l l r e l e v a n t 6 documents 7 Mr. 8 n o t g o t e v e r y t h i n g t h a t t h e y f e e l t h e y n e e d to 9 a n s w e r a b s o l u t e l y e v e r y t h i n g t h a t y o u h a v e a s k e d me. or thereabouts, f r o m t h e b an k , I a m s o r r y f o r that , 11 trying. 12 13 4 Q. A. E v e n t o t h i s day, I see. This is r e a l l y -- I m i g h t h a n d it o v e r t o y o u - ­ ( D o c u m e n t s h a n d e d over) 15 the s u p p o r t i n g documents. 16 e v e r y t h i n g w e h a v e at p r e s e n t 5 Q. we have b u t it h a s n o t b e e n f o r w a n t o f 14 17 I gave a a n d a s i m i l a r l e t t e r to Lavery more recently. 10 Originally, A l l right. t h e r e is a p r e a m b l e a n d t h e n Mr. Lavery assures me is t h e r e . It is g o i n g t o b e d i f f i c u l t , I think, to 18 d e a l w i t h t h a t i n a n i n t e l l i g e n t w a y now, 19 s u g g e s t is t h a t w e a r e g o i n g to h a v e t o l o o k at t h a t 20 after this interview. 21 the things that we will ask you will be dealt with 22 in that, 23 w e w i l l d o it t h a t way. 24 n o w and we will c a r r y on w i t h the interview. 25 A. 26 6 Q. so w h a t It m a y w e l l b e t h a t s o m e of i n w h i c h c a s e so m u c h t h e b e t t e r . V e r y w el l , I think W e w i l l n o t l o o k at t h a t yes. P e r h a p s it w o u l d b e u s e f u l , Mr. N e l i g a n , if y o u 27 w o u l d just describe a little your background, 28 for the record, 29 please. I You are a surgeon? just 1 N a t i o n a l C a r d i a c S u r g i c a l U n i t in t h e M a t e r H o s p i t a l 2 a n d m y p r i v a t e p r a c t i c e is c a r r i e d o n n o w l a r g e l y in 3 the B l a c k r o c k Clinic. 4 Lady's Hospital 5 a native Dulbiner, 6 m a r r i e d t o Dr. 7 inquiry, 8 7 Q. 9 10 I am also s u r g e o n to our for Sick C h i l d r e n in Crumlin. I l i v e j u s t d o w n t h e road, Patricia Neligan, Y o u h a v e als o, Yes, w h o is a l s o in t h i s and I have seven children. over the years, relationship with Guinness A. I am sir. had a banking & Mahon? T h a t c a m e a b o u t t h r o u g h t h e p u r c h a s e of 11 Rosefield, w h i c h is o n t h e M e r r i o n Roa d, 12 n o w the B l a c k r o c k Clinic, 13 w i t h Mr. 14 Dr. 15 o r t h o p a e d i c s u r g e o n w h o is b a s e d i n A m e r i c a , 16 Mr. 17 b e c a u s e at t h e t i m e t h i n g s w e r e q u i t e d i f f i c u l t 18 m e d i c a l l y in the country, 19 of b e d s , 20 up a clinic, 21 w h i c h we c o u l d p r a c t i s e as w e w i s h e d t o do, 22 than just p u r e l y through the publ i c hospitals. 23 t h e r e w e r e p r i v a t e h o s p i t a l s at t h e tim e, 24 w e r e n o t d o i n g t h e s o r t o f h i g h - t e c h n o l o g y k i n d of 25 t h i n g p a r t i c u l a r l y t h a t h e a n d I w e r e i n v o l v e d in. 26 His original 27 S t r a n d R o a d in M e r r i o n a n d I s a i d I w o u l d n o t b e 28 i n t e r e s t e d in a n y s u c h v e n t u r e u n l e s s w e c o u l d 29 po s sibly build a hospital. James Sheehan, G e o r g e Du f f y , Pat Campb e l l . a n d Mr. Mr. w h i c h is and I became associated the o r t h o p a e d i c surgeon, Joe Sheehan, w h o is a n o t h e r That was serendipity, and really, there were limited numbers S h e e h a n a n d I s a i d w e w a n t e d t o s et a s t a t e - o f - t h e - a r t m o d e r n c l i n i c in rather Now, but they i d e a w a s to b u i l d a c o n s u l t i n g s u i t e on This site became 1 available, 2 ar e a a n d all the n e g o t i a t i o n s 3 out b e t w e e n h i m s e l f and his uncle, 4 Sheehan, 5 The m o n e y for that was b o r r o w e d f rom G u i n n e s s 6 Mahon. 7 Guinness 8 0 'K e l l y . 9 8 Q 10 A 11 9 Q w e b o t h t h o u g h t it m i g h t b e a s u i t a b l e solicitor, As fo r t h a t w e r e c a r r i e d who was James who f i g u r e in t h o s e doc u m e n t s . I understand, & t h e c o n t a c t p e r s o n in & M a h o n B a n k at t h e t i m e w a s Mr. Maurice You say you understand? I t h i n k it is so. D i d you, yourself, h a v e m u c h b y w a y of d i r e c t 12 d e a l i n g s w i t h M a u r i c e O ' K e l l y or o t h e r p e o p l e in the 13 bank? 14 A No. I c a m e o v e r t h e y e a r s to k n o w Mr. O'Kelly 15 b e c a u s e h e w a s t h e first, 16 B l a c k r o c k Clinic, 17 But, 18 apart f r o m s i g n i n g m y n a m e on a p i e c e of paper. 19 fact, I u s e d to t e l l p e o p l e it w a s q u i t e e a s y to 20 b o r r o w a m i l l i o n pounds b e c a u s e all you d i d was sign 21 b i t s of p a p e r , 22 anybody any money, 23 10 Q no, C h a i r m a n of the an d I came to k n o w h i m p e r s o n a l l y . I was not i n v o l v e d in the n e g o t i a t i o n s but I se e m i n g l y was wrong. When you were involved with Guinness from Maurice O'Kelly, 25 Traynor? I n e v e r m e t Mr. 27 Mr. Traynor until this thing started. 28 absolutely, 29 11 Q sir, & Mahon, d i d y o u m e e t Mr. No, 26 In you did not a c t u a l l y have to h and 24 A i n fact, Traynor. Desmond I n e v e r h e a r d of n e v e r h e a r d o f him. No, aside 1 2 3 12 Q. 4 A. 5 13 Q. 6 A. 7 8 T h i s is y o u r l e t t e r of 9t h D e c e m b e r 1999, Exhibit 1? Yes. D o y o u h a v e a c o p y of t h a t ? I do not (SAME H A N D E D T O MR. NELIGAN) E x h i b i t 2. T h a n k you. 14 Q. 9 Your l etter says that you h ave n e v e r k no w i n g l y a v a i l e d of the services of A n s b a c h e r C a yman? 10 A. 11 15 Q. Yes. That you have no know l e d ge of a c o m p a n y c a l l e d Amiens 12 13 A. 14 16 Q. Securities Limited? Yes. T h a t y o u h a v e r e c e n t l y b e c o m e a w a r e of a l o d g e m e n t 15 to an account e n t i t l e d G u i nness 16 Re C o l l e g e ? 17 A. 18 17 Q. 19 & Mahon Cayman Trust Yes. You deal with some m atters a s s o c i a t e d wit h that account? 20 A. 21 18 Q. Yes. Y o u s a y t o t h e b e s t of y o u r k n o w l e d g e t h e C o l l e g e 22 account was never formally held by Guinness 23 as a s e c u r i t y f o r v a r i o u s 24 T h a t is e s s e n t i a l l y w h a t y o u r l e t t e r s a y s ? 25 A. 26 19 Q. & Mahon l o a n s a d v a n c e d t o you. Yes. What I w o u l d l i k e to do, please, I w o u l d like then 27 t o a s k y o u t o l o o k f i r s t o f a l l at t h e a c c o u n t in 28 the name of your wife. 29 10285008 T h i s is a c c o u n t n u m b e r (SAME H A N D E D T O MR. NELIGAN). Can you tell 1 me, 2 what you u n d e r s t a n d that account to be about? 3 A. just by working your way through the document, This account was mon i e s that were l o d g e d in Guinness 4 & M a h o n at a r o u n d t h a t date , 5 £6 0 , 0 0 0 a nd one of £30,000, 6 bank. 7 20 Q. 8 A. 9 21 Q. 10 A. 11 22 Q. M y wife, T h e c u r r e n c y is? Irish pounds, I think. It s a y s t h e d e s c r i p t i o n i s ? 13 " r e s i d e n t c a l l D/A", 14 account? 16 23 Q. 17 A. 18 24 Q. 19 A. 20 25 Q. 21 A. 22 26 Q. So, In the n a m e of y o u r w i f e ? Yes. Y o u se e t h e t r a n s a c t i o n s o n it? Yes. Finally, o n 2 0 t h N o v e m b e r 1986, account, Yes. 27 Q. 28 A. 29 28 Q. t h e a m o u n t of It w a s t r a n s f e r r e d o u t o f t h e leaving the account with a nil balance? There are two further drawings £60,000, 27 w h i c h I t a k e it t o m e a n d e p o s i t Yes. 24 26 I b e l i e v e it s a y s it is a n I r i s h p o u n d s r e s i d e n t d e p o s i t a c c o u n t ? £ 3 0 , 2 7 8 . 3 2 was drawn. A. I think you m a y have Yes. 23 25 w h i c h w e r e l o d g e d in the I think. d i f f i c u l t y r e a d i n g it, b u t A. one of In an a c c o u n t in the n a m e of? 12 15 in tw o m o i e t i e s , from the t h a t is t w o 30's. Yes? O n e 30 r a t h e r . Really, T h e 6 0 , 0 0 0 u l t i m a t e l y b e c a m e nil. the net point I w a s g e t t i n g us t o e s t a b l i s h 1 w a s t h a t t h e a c c o u n t go t t o a n i l b a l a n c e w h e n, 2 2 0 t h N o v e m b e r 1986, 3 A. 4 29 Q. 5 on £ 3 0 , 2 7 8 . 3 2 w a s d r a w n o u t o f i t? Yes. A l l right. Really, I t h i n k t h a t w h a t w e n e e d to e s t a b l i s h is w h e r e t h a t m o n e y w e n t to. 6 A. 7 30 Q. Yes. I n y o u r l e t t e r y o u s e n t us a n o t h e r d o c u m e n t -- a n d 8 w e d o h a v e c o p i e s o f t h i s one. 9 Guinness & M a h o n in t h e a c c o u n t n a m e d G u i n n e s s Mahon Cayman Trust/College, 10 11 A. 12 31 Q. Yes, T h i s is a c o p y o f a Exhibit & 3? sir. Y o u s e n t us t h a t w i t h y o u r l e t t e r a n d y o u say, "I 13 have r e c e n t l y b e c o m e aware of a lod g e m e n t to this 14 account." 15 become aware? 16 A. Because W h a t do y o u m e a n b y y o u h a d r e c e n t l y I h a d n o r e c o l l e c t i o n at all, o t h e r t h a n in 17 the most general 18 Guinness 19 amazed when I found that 20 list and that 21 because 22 It w a s o n l y w h e n w e w e n t b a c k o v e r it all, 23 h a d t o go b a c k o v e r it a l l t h a t t h i s c a m e t o m y 24 attention. 25 32 Q. 26 A. 28 33 Q. 29 of m y deali n g s with a n d I was, t o p u t it m i l d l y , I w a s i n f a c t n a m e d in t h i s I h a d m o n e y in the C a y m a n Islands, I h a d no r e c o l l e c t i o n o f t h a t w h a t s o e v e r . W h e r e did you get this s t atement from? t o 19 86. 27 & Mahon, of t e r m s , W h e r e d i d y o u g e t it? Presumably, from Guinness Y o u g o t it f r o m G u i n n e s s & Mahon. & Mahon? when I It g o e s b a c k 1 34 Q M a y we pl e a s e w o r k our w a y t h r o u g h this statement. 2 3 I see. A W h a t d o e s it t e l l y o u ? It t e l l s m e t h a t at s o m e s t a g e s o m e of m y m o n e y w e n t 4 to this Ansbacher, 5 p arti c u l a r account. 6 35 Q w h a t e v e r it is c a l l e d , C o u l d we j u s t l o o k at t h e t i t l e ? It s a y s this "Guinness 7 & Mahon Cayman Trust/College", and then down below 8 that 9 A 10 36 Q 11 A "Name MP"? Yes . W h o s e a c c o u n t is t h a t ? Now, there you have the trouble, because you did ask 12 in the l e t t e r that you sent me what was the 13 s i g n i f i c a n c e of "MP". 14 w o u l d h a v e to tell yo u I d o n ' t 15 s p e c u l a t e i f t h a t is of a n y i n t e r e s t t o you. 16 37 Q 17 A Now, I a m h e r e o n o a t h so I know. But, P l e a s e do. We n e v e r e v e r w e r e g i v e n a code or a n y t h i n g like 18 that b y the bank. 19 Patricia. 20 I cannot answer that t ruthfully because 21 not know the answer. 22 g i v e n a n y code. 23 us . 24 38 Q 25 26 I could "MP" a r e m y w i f e ' s i n i t i a l s , Mary T h e y c o u l d a l s o r e f e r t o M a u r i c e a n d Pat. W e h a d n o cod e, I j u s t do we were never "M P" r e a l l y m e a n t n o t h i n g at a l l to Is t h e r e s o m e p o s s i b i l i t y , Mr. Neligan, that this m a y n o t b e to d o w i t h y o u at a l l ? A It is a p o s s i b i l i t y , sir, but I r e a l l y -- I j u s t 27 c a n n o t s p e c u l a t e o n it, 28 m e a n t n o t h i n g t o us, 29 a r e m y w i f e ' s i n i t i a l s o r it c o u l d b e a n a m a l g a m of I j u s t d o n ' t know. apart But, it from the fact that they 1 2 39 Q. 3 Well, l e t ' s c a r r y on. You notice that the currency is i n I r i s h p o u n d s ? 4 A. 5 40 Q. Yes. A n d t h a t t h i s a c c o u n t is d e s c r i b e d as a n " e x t e r n a l call deposit 6 7 A. 8 41 Q. 9 account"? Yes. O n 2 0 t h N o v e m b e r 1986, t here was a c redit to the a c c o u n t -- in o t h e r w o r d s , m o n e y was t r a nsferred 10 i n t o t h e a c c o u n t -- u s i n g t h e t e r m s 11 Mahon Cayman", 12 £30,278.32"? 13 A. 14 42 Q. 15 A. and the amount was "EXCH Guinness & "credit Yes. W h a t can we c o n c l u d e was h a p p e n i n g there? I w o u l d c o n c l u d e t h a t £ 3 0 , 0 0 0 o f m y m o n e y was, fo r 16 some reason, 17 c a n n o t u n d e r s t a n d is t h a t t h a t r e l a t e s t o a 18 borrowing, 19 £ 9 0 , 0 0 0 to p u r c h a s e a p r o p e r t y , 20 monies 21 t h e w o r d " c o m f o r t " w a s u s e d -- a n d t h a t t h e s e m o n i e s 22 were invested partly; 23 the Cayman Islands 24 s t a y e d at h o m e f o r s o m e r e a s o n . Now, 25 a n d w h y it w a s b r o k e n u p i n two, I h a v e n o idea. 26 43 Q. What sent to the C a y m a n Islands, but what I the w h o l e t h i n g r e l a t e s to a b o r r o w i n g of and that this was t h a t w e r e i n t h e b a n k t h a t w e r e -- I t h i n k is p e r h a p s £ 3 0 , 0 0 0 a p p a r e n t l y w e n t o u t to fo r s o m e r e a s o n a n d £ 6 0 , 0 0 0 w h y that was i n t e r e s t i n g is t h a t if t h i s a c c o u n t 27 w a s c r e a t e d i n 1986, 28 y o u or y o u r w if e , 29 i n f o r m a t i o n in t h i s a c c o u n t , p r e s u m a b l y f r o m t h a t p o i n t on or w h o e v e r was e n t i t l e d to the got i n f o r m a t i o n 1 2 A. T h a t m a y w e l l be. It c a m e b a c k i n 1988, apparently 3 -- I a m s p e a k i n g n o w w i t h t h e b e n e f i t o f l o o k i n g at 4 this 5 six m o n t h s ago I w o u l d h ave said to you w i t h m y h a n d 6 on m y heart that 7 the C a y m a n Islands. 8 4 4 Q. 9 A. for the last month. I didn't If y o u h a d a s k e d m e t h i s k n o w I h a d a n y m o n e y in You knew you had a deposit somewhere? I knew, sir, that I had borrowed money from Guinness 10 & Mahon, 11 all the ori g i n al 12 t h e m and we were r e p a y i n g t h e m interest over the 13 years. 14 another, 15 t h e n t h a t w h e n I w i s h e d to b o r r o w m o n e y t o b u y t h e 16 h o u s e t h a t it w a s s u g g e s t e d t o m e b y s o m e b o d y t h a t 17 'y ou m i g h t as w e l l b o r r o w it f r o m G u i n n e s s 18 b e c a u s e y o u h a v e g o t a lo t o f d e a l i n g s w i t h t h e m 19 already.' 20 it w a s t h e b a n k t h a t s u g g e s t e d tha t, 21 h a v e b e e n m y a c c o u n t a n t s at t h e ti m e , 22 'well, 23 T h a t is t h e £ 9 0 , 0 0 0 , 24 went 25 Cay m a n Islands. 26 45 Q. Yes. in l a r g e q u a n t i t i e s I m i g h t add, because clinic monies were borrowed from They were business l o a n s o f o n e s o r t or a l l of w h i c h a r e d o c u m e n t e d t h e r e . Now, t o b e h o n e s t w i t h you, I know & Mahon I don't think that m ay well w h o said, y o u m i g h t as w e l l b o r r o w it f r o m t h e b a n k . ' t h a t is in t h e £ 6 0 , 0 0 0 t h a t for the g i l t s a n d the £ 3 0 , 0 0 0 t h a t w e n t to the T h a t is l o o k i n g b a c k o n it now. I r e c o g n i s e t h a t t h i s is q u i t e s o m e y e a r s a g o 27 a n d I r e c o g n i s e t h a t it is n o t e a s y a l w a y s to r e c a l l 28 things precisely, 29 v e r y s i m p l e p o i n t to e s t a b l i s h is, but what I am trying, really, presumably, a 1 s o m e b o d y s e n t y o u a s t a t e m e n t o f a c c o u n t e v e r y so 2 o ften for this £30,000. 3 w i t h o t h e r i m p o r t a n t m a t t e r s a n d it m a y b e t h a t t h e 4 s t a t e m e n t d i d n o t a c t u a l l y f i n d i t s w a y t o you. 5 that p o s s i b l y the case? 6 A. Yes, You m a y well be v e r y b u s y it is p o s s i b l y t h e case . I n a n y case , Was any 7 s t a t e m e n t s w e w o u l d h a v e r e c e i v e d w o u l d h a v e g o n e to 8 our accountants 9 t h e m o n to t h e m f o r f o r m a l i s a t i o n of o u r a c c o u n t s at t h e tim e . We w o u l d have p a ssed 10 and h o w we w ere d o i n g our r e pa y m e n t s 11 etc, 12 46 Q. 13 A. 14 47 Q. 15 A. a n d our income, a n d t h e y w o u l d h a v e g o n e to our a c c o u n t a n t s . W h o w e r e the y, just for the record? C rann & Lennon. W h e r e are the y based? M o r e h a m p t o n Road , I think. Incidentally, just since 16 I was giving you a preamble, 17 C rann & Lennon, 18 person, 19 p r o b a b l y g l a r i n g l y o b v i o u s to y o u b y now. 20 off with A l l i e d Irish Banks 21 a n d o n t h e a d v i c e o f s o m e c o l l e a g u e s t r a n s f e r r e d to 22 a m a n w h o s e n a m e e s c a p e s m e now, a r e t i r e d Tax 23 Inspector. I think having 24 p r e p a r e d o n e set of a c c o u n t s 25 7 0 's, 26 called O'Hare 27 m e t a m o r p h o s e d into Crann & Lennon, 28 my accountants. 29 sir, t h e r e a s o n I c a m e to I am not a v e r y f i n a n c i a l l y a s tute m o n e y is n o t r e a l l y m y f or te , I started Income Tax Department T h i s g e n t l e m a n died , and I was as is f o r me, s o m e t i m e in t h e sold by his w i d o w to a c o m p a n y & Barry, So, and O'Hare & Barry who then became it w a s a s e r i e s o f p e o p l e . 1 2 48 Q Y o u b e l i e v e t h a t t h e p o s s i b i l i t y is t h a t if t h e r e 3 were statements 4 f o u n d t h e i r w a y to C r a n n & L e n n o n ? 5 A on t h i s a c c o u n t t h a t t h e y w o u l d h a v e I b e l i e v e it is a p o s s i b i l i t y . They c ould have come 6 h o m e t o m y h o u s e a n d w e c o u l d h a v e s e n t t h e m o n to 7 C rann & Lennon, 8 at a l l o f it. 9 49 Q Simply because your interest is n o t r e a l l y in t h i n g s financial? 10 11 A 12 50 Q Yes . Yes, I see, right. 13 Guinness 14 approximately? 15 but I h o n e s t l y have no r e c o l l e c t i o n A Again, This deposit was reta i n e d with & Mahon Cayman Trust f o r h o w long, l o o k i n g b a c k at t h e d o c u m e n t s t h a t I h a ve , 16 t h i n k it a l l c a m e b a c k t o g e t h e r , 17 £30,000, 18 as I c a n see, 19 insurance policies, 20 t h a t w a s t h e e n d o f a n y i n v o l v e m e n t of t h a t m o n e y 21 overseas, 22 documents. 23 51 Q 24 A 26 52 Q 27 A 28 53 Q 29 the £ 6 0 , 0 0 0 a nd the it a l l c a m e b a c k t o g e t h e r i n 1989, as f a r w h e n the m o n i e s were u s e d to b u y some or w h a t e v e r . A s f a r as I know, or so it s e e m s to b e f r o m l o o k i n g at t h e s e Presumably, d u r i n g t h e l i f e o f t h e d e p o s i t it e a r n e d interest? 25 In t h e C a y m a n I s l a n d s ? Wherever. Presumably, yes. But you don't I think, I know that? f r o m t a l k i n g to m y a c c o u n t a n t s , 15 I think 1 w h e n t h e m o n e y c a m e b a c k it w a s a p p r o x i m a t e l y 2 £38,000. 3 54 Q 4 Do y o u k n o w w h e t h e r t h a t i n t e r e s t w o u l d h a v e b e e n r e t u r n e d as p a r t o f y o u r i n c o m e ? 5 A 6 55 Q 7 A I d o u b t it v e r y m u c h , sir. W h y do you say that? Well, I do not k n o w that , but I would have thought 8 t h a t t h e w h o l e p u r p o s e o f t h e s e t h i n g s w a s t h a t it 9 was m o n e y that was out of the country, 10 not d e c l a r e d to the Revenue. 11 b u t t h a t is w h a t 12 56 Q 13 Presumably, t h a t it w a s I d o n o t k n o w that, I w ould imagine. your accountants could give a clear a n s w e r to t h a t ? 14 A 15 57 Q 16 A I would imagine so, sir, yes. W o u l d you establish that with them? Yes. I h a v e p r o b l e m th e r e , because I d i d in fact - ­ 17 I f o u n d it v e r y d i f f i c u l t to u n d e r s t a n d a l l o f this . 18 I d i d n o t u n d e r s t a n d w h y t h i n g s g o t s p l i t up, 19 n e c e s s i t y o f d o i n g t h i n g s t h i s way, the gilt that 20 w a s b o u g h t w i t h p a r t of t h e m o n e y . I d i d not seem 21 to derive any b e n e f i t 22 with the whole 23 r e - a m a l g a m a t e d a nd the t hings were bought, 24 t h e y w e r e n a m e s t h a t I knew. 25 C h a r t e r a n d F r i e n d s P r o v i d e n t a n d that , 26 things that 27 a b o u t it. 28 from m y accountants exactly how I stood and I did 29 f i n d it d i f f i c u l t t o ge t s o m e s t a t e m e n t s a b o u t the from this and I was unhappy situation. W h e n the m o n e y was at l e a s t Things like Standard they were I knew a nd I felt a l ittle bit h a p p i e r But, I d i d h a v e p r o b l e m s w i t h f i n d i n g out 1 various other things from them. I eventually 2 changed my accountants. 3 happy, 4 c o n f i d e n c e w i t h t h e m. 5 1992, 6 here. 7 was not s o m e t h i n g that he was co m f o r t a b l e w ith and 8 he f e l t t h a t 9 a n d he felt that I just said I am not re a l l y I had lost rapport, I h a d l o s t a s e n s e of I changed my accountants to J o h n K. W o o d s o f W o o d s H o u s e d o w n t h e r o a d W h e n h e l o o k e d at a l l o f t h i s h e f e l t t h a t it I should not have been comfortable with I s h o u l d r e g u l a r i s e it as q u i c k l y 10 as I co ul d, 11 c o m p r i s e d all of t h e s e t h i n g s b e c a m e 12 R e v e n u e in 1993. 13 58 Q 14 A w h i c h I did, That was p e r h a p s Yes. i n 1993, 16 known were made 59 Q I see. Aside k n o w n to them . from this deposit account, 19 ...(INTERJECTION). 21 60 Q To m y h o r r o r , sir, either Ansbacher, 23 & Mahon? A 25 61 Q yes. u n k n o w i n g to you, F o r g i v e me, w e h a v e n ' t h a d a c h a n c e t o l o o k at t h e s e 27 i n f o r m a t i o n that we know about. 29 62 Q or w i t h G u i n n e s s No. documents, A as be c a m e an A n s b a c h e r account 26 28 which, ... d i d y o u m a i n t a i n a n y o t h e r d e p o s i t a c c o u n t s w i t h 22 24 known to the Revenue a n d a n y o t h e r m o n i e s t h a t he f e l t s h o u l d b e you now appreciate, A k n o w n to t h e associated with the amnesty? 18 20 a n d a l l of t h i s m o n e y t h a t All of this m o n e y b e c a m e 15 17 in t h e r e f o r e I am g oi n g t h r o u g h the M a y I j u s t t a l k t o Mr. Yes . L a v e r y for a se c o n d ? 1 No, 2 t o th e r e . 3 A l l right. 4 had very substantial loans 5 various purposes, 6 Blackrock Clinic construction. 7 A 8 64 Q 9 10 is t h e a n s w e r , Now, just the two ac c o u n t s you r efer y o u h a v e i n d i c a t e d t o us t h a t y o u from Guinness & M a h o n for n o t t h e l e a s t of w h i c h w a s t h e Yes . C a n y o u t e l l us j u s t a l i t t l e b i t m o r e a b o u t t h o s e l o a n s a n d w i t h w h o m y o u d e a l t in G u i n n e s s A T h e r e is a s c h e d u l e of t h e m t h e r e , It is p a r t 11 o f m y s t a t e m e n t to you. 12 came about 13 & Mahon, 14 you, 15 d e a l b u t w h o m at t h a t s t a g e I k n e w t h r o u g h t h e 16 B l a c k r o c k Clinic, 17 c a m e b a c k to m e a f t e r 14 o r 15 y e a r s w a s Mr. 18 O'Keeffe, 19 me was b e c a u s e we u s e d to t a l k a b o u t fishing. 20 w h e n I w e n t t h r o u g h these, 21 Waite c a m e to m y a t t e n t i o n a n d I d o r e m e m b e r t h e 22 n a me , a l t h o u g h I c o u l d not put a face on the man. 23 But, 24 about these t hings w o u l d h ave gone on t h r o u g h m y 25 accountants 26 65 Q 27 A In fact, sir. & Mahon? w h e n all of this I was a sked who I dealt w i t h in Guinness a n d I k n o w t h i s m a y s e e m e x t r a o r d i n a r y to but apart f r o m Mr. O'Kelly, with whom I didn't the onl y o ther p e r s o n whose name Lanigan a n d t h e o n l y r e a s o n h i s n a m e c a m e b a c k to t h e n a m e o f Mr. Now, Chris a lo t of t h e t a l k i n g a b o u t t h e n e g o t i a t i o n rather than through myself. Crann & Lennon? Yes. Now, 28 Pa t L e n n o n , 29 t ime, if I m i g h t m a k e o n e o t h e r p o i n t . When w h o w a s d e a l i n g w i t h us m o s t l y at t h a t u s e d to c o m e to t h e h o u s e , o c c a s i o n a l l y he 1 would have things fo r u s t o s i g n v i s a v i s t h e l o a n s 2 a nd/or the investments, 3 that, 4 7.00 in the evening, 5 i n v a r i a b l y was n e v e r there. 6 b u s y years w he n we were d oi n g the first heart 7 transplants 8 wife would sometimes 9 t r u s t e d Mr. or w h a t e v e r . if yo u like to call t h e m Now, h e w o u l d c o m e at 6 . 0 0 or which was a time that I These were particularly a n d it r e a l l y w a s ver y , sign these. L e n n o n a n d Mr. v e r y busy. My We absolutely Cr a n n , and to this day I 10 h a v e n o r e a s o n to t h i n k t h a t t h e y w e r e i n f a c t n o t 11 serving me correctly. 12 for the s e p a r a t i o n b e t w e e n m y wife a n d myself, 13 b e c a u s e in a l l o u r a c c o u n t s , 14 dealings 15 a n d t h e s e a r e t h e f i r s t t h i n g s t h a t h a v e c o m e u p in 16 w h i c h t h i n g s a r e in o n e n a m e a n d n o t i n t h e o t h e r . 17 66 Q. But, I think that accounts all our b u s i n e ss al l o u r l i f e w e h a v e h a d j o i n t a c c o u n t s , What this schedule ( E x h i b i t 4) s h o w s is t h a t y o u 18 started borrowing from Guinness 19 1981? 20 A. 21 67 Q. That w o u l d be correct. T h e r e w e r e a s e r i e s of lo a n s , w i t h the last one on t h e s c h e d u l e b e i n g in in J u l y 1 9 8 8 ? 22 23 & M a h o n in D e c ember A. Yes, sir. W h e n I r e a d t h a t loan, w h e n I r ead the 24 s c h e d u l e again, 25 I recollected borrowing. 26 t a l k e d to Mr. 27 a p p a r e n t l y e v e r y t i m e t h e y r e s t r u c t u r e d t h e l o a n it 28 got a d i f f e r e n t 29 b o r r o w e d f o r t h e c l i n i c w a s a p p r o x i m a t e l y -- now, it s e e m e d to b e f a r m o r e m o n e y t h a n But, L a v e r y a n d Mr. loan number. apparently, having D o o l i n of W o o d s So, & Co., the sum total it 1 m a y b e c l e a r e r in t h e d o c u m e n t 2 £150,000, 3 a c c r u e d o n it, 4 is c o m p l e t e l y s e p a r a t e a n d w a s 5 b o r r o w i n g for the house. 6 w o u l d have bee n tax d e d u c t i b l e on a b u s i n e s s 7 T h e s e c o n d b o r r o w i n g fo r t h e h o u s e w a s n o t t a x 8 d e d u c t i b l e n o r w a s it c l a i m e d a g a i n s t tax. 9 68 Q. I see. -- a p p r o x i m a t e l y plus all the int e r e s t that w o u l d have and then there was the £90,000 which fo r t h e p e r s o n a l The initial borrowings You also m e n t i o n e d a little earlier that you 10 h a d s o m e m o n e y i n v e s t e d in g i l t s , 11 C a n y o u p l e a s e t e l l us a l i t t l e a b o u t t h a t ? 12 A. Yes, loa n. I t h i n k y o u said. that was the £60,000 deposit account, account 13 No. 14 t h e y c o n v e r t e d it i n t o a g i l t . 15 was r e j o i n e d w i t h the A n s b a c h e r t h i n g to p r o v i d e the 16 m o n e y for the t hree i n s u r a n c e policies. 17 69 Q. 18 an d that was in G u i n n e s s & Mahon and T h a t als o, You deposited money with Guinness i n 1989, & Mahon and s o m e o n e a d v i s e d y o u to b u y g i l t s w i t h t h a t m o n e y ? 19 A. 20 70 Q. Yes, b u t i f y o u a s k m e w h o it was, I h a v e n o idea. T h e g i l t s w e r e t h e n u s e d as a s e c u r i t y f o r v a r i o u s borrowings ? 21 22 10285008, A. I w o u l d a s s u m e t h a t is t h e case, sir. It is n o t 23 o f f i c i a l l y d e s i g n a t e d as such, 24 t h a t -- t h e w o r d t h a t s t r u c k me, 25 t h o u g h t it w a s a n u n u s u a l w o r d g i v e n i n t h e 26 circumstances, 27 Because 28 s o m e b o d y s u g g e s t e d to m e t h a t it w o u l d b e a c o m f o r t , 29 and I always thought that the wo r d was incongruous, but I would presume and always I t h a t t h e w o r d " c o m f o r t " w a s us e d . I had extensive borrowings from them and 1 to t h e b a n k to h a v e d e p o s i t s w i t h t h e m as w e l l . 2 I p r e s u m e t h a t is t h e case. 3 71 Q. 4 A. So, Wha t do you t h i n k the y m e a n t b y "comfort"? Well, I w ould think security, additional security, 5 a l t h o u g h it is n o t m e n t i o n e d as s u c h i n a n y o f t h e 6 documents. 7 deeds, 8 b i t of m o n e y . 9 MR. T h e y h a d al l t h e u s u a l s e c u r i t i e s , shares, etc. But, ROWAN: we d id owe t h e m quite a I don't think I have any m o r e q u e s t i o n s at t h i s 10 11 point. W e w i l l a d j o u r n f o r a b o u t t e n m i n u t e s to 12 have a cup of coffee. 13 14 E N D O F E X A M I N A T I O N O F MR. N E L I G A N B Y MR. ROWAN 15 16 SHORT ADJOURNMENT 17 18 MR. NELIGAN WAS EXAMINED, AS FOLLOWS, MS. MACKEY: Mr. B Y MS. M A C K E Y 19 20 72 Q. Neligan, matters, 21 just to some w h e n y o u s e n t us 22 t h e d o c u m e n t w h i c h is a s t a t e m e n t of a c c o u n t 23 06040233, 24 T r u s t " o n t h e top, 25 Exhibit 26 27 28 29 1, the one with "Guinness & Mahon Cayman you t o l d us in y o u r letter, y o u said: "I r e c e n t l y b e c a m e a w a r e o f a l o d g e m e n t o n 2 0 t h N o v e m b e r to a n a c c o u n t e n t i t l e d 'Guinness & M a h o n C a y m a n Trust' a nd I attach a p h o t o c o p y of a statement showing this lodgement." 1 Now, 2 you didn't under s t a n d what the letters 3 Yes . 4 73 Q i n a n s w e r to Mr. Rowan's questions, you said "M P" w e r e ? W h a t m a d e y o u t h i n k t h a t it w a s y o u r s t a t e m e n t , 5 E x h i b i t 2, y o u s e n t it to u s as b e i n g s o m e t h i n g 6 r e l e v a n t to a n a c c o u n t o f y o u r s ? 7 A T h e fi rst, b e f o r e Mr. Lavery became involved, when I 8 s t a r t e d to a s k the b a n k for d e t a i l e d s t a t e ments, 9 s i g n e d a l e t t e r o f a u t h o r i t y to m y a c c o u n t a n t , 10 Mr. W o o d s , 11 b a n k as p a r t o f m y file. 12 it r e l a t e d to me. 13 h o n e s t w i t h you. 14 74 Q 15 A a n d it w a s h e w h o r e c e i v e d t h i s So, I from the I p r e s u m e d then that I n e v e r q u e s t i o n e d that , to b e Y o u n e v e r q u e s t i o n e d i t? No, Ms. M a c k e y , I didn't, b e c a u s e he said, " T h i s is 16 what I have got from the b a n k r e l a t i n g to y o u , " and 17 I a c c e p t e d t h at . 18 otherwise. 19 75 Q D i d h e p o i n t o u t to y o u t h e s i g n i f i c a n c e of t h e h e a d i n g o n it? 20 21 I d i d n ' t h a v e a n y r e a s o n to t h i n k A Ansbacher Cayman? Yes, what w ere you at?" h e did. He said, "Oh, m y 22 God, 23 me, 24 w h a t a l l o f t h i s is a b o u t . " 25 true statement 26 But that d idn't give you the impetus to q u e r y this 27 w i t h t h e b a n k a n d say, 28 m i s t a k e ." 29 No, a n d I said, it d i d n ' t , "John, f r o m me, I t h i n k is w h a t he s a i d to I haven't the faintest idea T h a t at t h e t i m e w a s a I h a d n ' t t h e f a i n t e s t idea. 'There seems to be a b e c a u s e at t h i s s t a g e I h a d m y 22 1 professional 2 m a k e me feel a ny happier, 3 77 Q. a d v i s e r s d o i n g t h a t f o r me. It d i d n ' t I h a v e t o t e l l you. That l eads m e p e r h a p s to a n o t h e r question, because 4 y o u said, 5 t i m e of w h a t y o u d e s c r i b e d as t h e s p l i t t i n g o f t h e 6 monies, 7 and the £30,000 8 & M a h o n C a y m a n Trust, 9 s p l i t t i n g of the m o n i e s ? 10 A. a g a i n i n a n s w e r to Mr. Rowan, t h a t at t h e t h e p u t t i n g of t h e £ 6 0 , 0 0 0 i n t o o n e a c c o u n t It w a s n ' t t h a t into, as it n o w t u r n s out, Guinness you felt u n e a s y about that I felt uneasy. I don't have any 11 r e c o l l e c t i o n of it. 12 of 13 o r 14 y e a r s a n d I d o n ' t h a v e a n y r e c o l l e c t i o n 13 of it. 14 If t h e r e w a s £ 9 0 , 0 0 0 th e r e , 15 a l l i n t h e g i l t o r w h y d i d n ' t t h e y p u t it a l l in 16 A n s b a c h e r Cayman, 17 j u s t d o n ' t u n d e r s t a n d tha t. 18 78 Q. 19 20 But, It is l o o k i n g b a c k n o w at a g a p l o o k i n g at it n o w it s t r i k e s m e as odd. w h y d i d n ' t t h e y p u t it o r w h y w a s it d o n e t h i s way, D i d y o u k n o w at t h a t t i m e t h a t it w a s d o n e t h a t way, t h a t it w a s in f a c t s p l i t ? A. I h a v e n o r e c o l l e c t i o n o f tha t, you. 22 b u t t h e l o g i c o r t h e r e a s o n f o r it, 23 k n o w l e d g e of, 24 n o t u n d e r s t a n d it. 79 Q. In hin d s i g h t , to be h o n e s t with 21 25 it o b v i o u s l y w a s d o n e t h a t way, I h a v e no I h a v e no m e m o r y o f it a n d I s t i l l do G o i n g b a c k t h e n to 1992, when you changed your 26 accountants, 27 b e c a u s e you were not t o t a l l y h a p p y w i t h the way 28 things were? 29 and I y o u t o l d us t h a t y o u c h a n g e d t h e m 1 80 Q y o u s e e m e d t o s a y t h a t in t h e c o n t e x t of the s p l i t t i n g of m o n i e s ? 2 3 A s I u n d e r s t o o d it, A No, it w a s n ' t so m u c h th a t . It w a s a g e n e r a l 4 f e e l i n g t h a t w e w e r e ou t o f sync, 5 have a rapport that I felt we p r o b a b l y s h o u l d have 6 had. 7 just said I felt I w o u l d r a t h e r change. 8 81 Q 9 that we did not I w a s p e r s o n a l l y a c q u a i n t e d Mr. W o o d s a n d I I t h i n k yo u s a i d t h e n that w h e n yo u w e n t to Mr. W o o d s h e l o o k e d at y o u r a f f a i r s a n d h e w a s n o t 10 h a p p y w ith this state of things, 11 to m e a n the s p l i t t i n g of the m on e y ? 12 A No, which again I took I t h i n k what he in all felt was that t here was 13 m o n e y t h e r e w h i c h he w o u l d f i n d d i f f i c u l t to 14 u n d e r s t a n d w h e r e it c a m e f r o m a n d h e f e l t t h a t t h e r e 15 w ere i r r e g u l a r i t i e s w h i c h sh o u l d be corrected. 16 82 Q 17 A He m a d e y o u a w a r e in 19 92 o f i r r e g u l a r i t i e s ? He j u s t f e l t t h a t t h e r e w e r e t h i n g s t h a t he w o u l d 18 f i n d d i f f i c u l t to a c c e p t a n d that I s h o u l d r e c t i f y 19 this in a w a y that was watertight, 20 watertight. 21 83 Q t h a t he f e l t w a s W h a t d i d he i n d i c a t e to y o u p a r t i c u l a r l y t h a t h e w a s 22 wo rried about? 23 I honestly don't 24 in p a r t i c u l a r l y where the three insurance policies 25 h a d c o m e from, 26 l o a n s w e r e p a i d off. 27 " W h a t is al l t h i s a b o u t ? " 28 a b o u t t a k i n g o u t t h e l o a n in 1986, 29 s o m e t h i n g to b e e f f e c t t h a t know. I think the whole scenario, w h i c h r e v e r t e d to m e w h e n a l l t h e I r e m e m b e r he s a i d t o me, I t h e n e x p l a i n e d to h i m a n d he said "I d o n ' t m u c h l i k e t h a t 1 a n d I w o u l d f i n d t h a t d i f f i c u l t a n d I t h i n k we 2 b e t t e r do s o m e t h i n g a bout tha t . " 3 84 Q. 4 clarified the m a t t e r with the Revenue Commissioners? 5 A. 6 85 Q. 7 8 I think you said that during the amnesty you Yes. W a s t h a t s p e c i f i c a l l y in r e l a t i o n t o t h e i n t e r e s t t h a t h a d a c c u m u l a t e d on this d e p o s i t ? A. 9 A t t h a t s t a g e it w a s a l t o g e t h e r . £90,000, w h i c h was the original, It h a d g r o w n f r o m if y o u a d d t h e 60 10 a n d t h e 30. 11 it h a d g r o w n i n t o -- it w a s m e a n t t o b e £ 1 1 3 , 0 0 0 , 12 the a m a l g a m a t i o n of the t hree things. 13 t u r n e d ou t t o b e £ 1 1 1 , 0 0 0 . 14 p l u s t h e 30 p l u s a n y i n t e r e s t a l o n g t h e li n e . 15 wasn't exactly a brilliant 16 t o say, 17 dissatisfaction. 18 b e t t e r in t h e EBS, 19 86 Q. It h a d g r o w n o v e r t h e s i x - y e a r p e r i o d , I just to p u r c h a s e a pr o p e r t y ? 87 Q. 24 It I would have felt that I w o u l d have b e e n loan, I t h i n k y o u said, for p e r s o n a l r e asons Yes. It w a s t h i s loan, as I u n d e r s t a n d it, that became divided? 25 A. 26 88 Q. 27 A. 28 89 Q. 29 investment, 60 I am not totally clear about what origi n a l l y was a 21 23 That i n cluded the t o b e h o n e s t w i t h you. £90,000 A. in fact, w h i c h a g a i n I t h i n k was p a r t of m y 20 22 It, Yes. T h a t l o a n i n i t i a l l y w a s to p u r c h a s e a p r o p e r t y ? Yes. It d o e s n o t a p p e a r to h a v e b e e n u s e d f o r t h a t ; is 1 No, 2 b a n k to p u r c h a s e t h e p r o p e r t y . 3 p u r c h a s e d for £90,000. 4 90 Q 5 A I t h i n k e q u i v a l e n t m o n e y was b o r r o w e d f rom the Right. A n d t h a t t h a t l a y t h e r e as c o m f o r t , whatever, 6 7 91 Q 8 A 9 92 Q 10 A The p r o p e r t y was for security, ...(INTERJECTION). What lay there? The £90,000, the 60 a n d t h e 30. W here did that come from? That came from overseas, f r o m t h e I s l e o f Man. 11 h a d n o t h i n g t o do w i t h G u i n n e s s 12 n o t h a v e -- i f y o u l o o k at t h e v e r y l a s t t h i n g of 13 the preamble 14 d o c u m e n t a t i o n in r e l a t i o n to t h e o p e n i n g o f a c c o u n t 15 No. 16 details 17 w i l l g i v e t h e m to you. 18 p r e c e d i n g p a r a g r a p h -- no, 19 is j u s t w e h a v e n o t r e c e i v e d t h e d e t a i l s , 20 ...(INTERJECTION). 21 93 Q 10285008 I h a v e given, or 0 6 0 4 0 2 3 3 . & Mahon. We have r e q u e s t e d full f r o m the c o m p a n y a n d w h e n we get t h e m we Now, in the i m m e d i a t e l y t h a t is n o t r e a l l y -- it I a m s o r r y to cu t a c r o s s y o u t h e r e , j u s t g e t t i n g b a c k to thi s, 23 t h e p u r c h a s e o f a h o u s e i n Ke r r y , A 25 94 Q 26 Mr. but Neligan, you b o r rowed £90,000 A 28 95 Q 29 A but for I t h i n k it w a s ? Yes . Then monies c a m e f r o m t h e I s l e o f M a n e q u i v a l e n t to that amount? 27 I do I don't have any 22 24 Now, That Yes . C a n y o u t e l l us a b o u t t h a t ? Well, clearly, if I h a d £ 9 0 , 0 0 0 26 s i t t i n g i n an 1 o r d i n a r y b a n k a c c o u n t in D u b l i n I w o u l d h a v e b o u g h t 2 the h ouse for £90,000. 3 to b o r r o w the m o n e y from somewhere. 4 h a v i n g several options or d i s c u s s i n g s everal o p tions 5 at t h e t i m e as t o w h e r e I b o u g h t m y o w n h o u s e from, 6 whatever, 7 " W h y d o n ' t y o u b o r r o w it f r o m G u i n n e s s 8 t hink that p r o b a b l y was the accountant, 9 o a t h so I c a n n o t s a y t h a t I d i d n o t h a v e it, me, 11 and Guinness 12 t h e r e was, 13 absolute r e q u irement that 14 monies 96 Q. 16 for certain. & Mahon?" b u t I a m on H e s a i d to " W h y d o n ' t y o u b o r r o w it f r o m G u i n n e s s & M a h o n w e r e a m e n a b l e t o it. as I h a v e s a i d t o Mr. Rowan, I & Mahon?" Now, t h e r e w a s no I would put equivalent i n as s e c u r i t y . T h e r e was no a b s o l u t e r e q u i r e m e n t , but ...(INTERJECTION). 17 A. 18 97 Q. 19 No. ... t h i s is w h e r e t h e y s u g g e s t e d t o y o u it m i g h t b e a comfort? 20 A. 21 98 Q. The w o r d "comfort", yes, came about. C a n y o u r e m e m b e r w h o in G u i n n e s s & M a h o n used that word? 22 23 A. 24 99 Q. 25 26 I remember a n d s o m e b o d y at t h a t t i m e s u g g e s t e d to me, 10 15 so I h a d No, I cannot. C a n y o u r e m e m b e r w h o y o u w e r e d e a l i n g w i t h at t h a t time? A. No. T h e o n l y t w o n a m e s in G u i n n e s s 27 d e a l t wi t h , 28 O ' K e e f f e a n d Mr. 29 I can remember. that I can remember, Waite. & Mahon that w e r e Mr. I Lanigan The y are the onl y two that 1 100 Q 2 A 3 101 Q 4 A 5 6 It m ay . You don't It m a y e v e n h a v e b e e n m y a c c o u n t a n t w h o s u g g e s t e d it t o me, 102 Q know? w h o u s e d t h e wo r d . Anyway, w h o e v e r s u g g e s t e d it, it w a s s u g g e s t e d to 7 y o u t h a t it w o u l d b e a c o m f o r t t o h a v e m o n e y o n 8 d e p o s i t in G u i n n e s s 9 y o u w e r e b o r r o w i n g at t h a t t i m e ? 10 A Yes. & M a h o n equal to the amount that I c o u l d b e a g a i n w r o n g here , Ms. Mackey, but 11 t h i n k it w a s s u g g e s t e d to m e -- as y o u l o o k t h r o u g h 12 those schedules, 13 t h e m a c o n s i d e r a b l e amount of money, 14 j u s t b o r r o w i n g f o r K e r r y it w a s b o r r o w i n g f o r t h e 15 c l i n i c and e v e r y t h i n g like that. 16 h a v e b e e n l o o k i n g at it in a n o v e r a l l c o n t e x t as 17 w el l , 18 i n t h e ba n k . 19 103 Q 20 A you will find that in fact I owed A s I say, the v e r y last t h i n g there, 22 o v e r s e a s i n t h e I s l e of Man . 24 A 25 105 Q 26 A I t h i n k it m a y How did you organise that then? the full documentation, 104 Q a n d it w a s n ' t that t h e y w o u l d be h a p p i e r if I h a d some m o n e y 21 23 I but I do not have I did have money C a n y o u t e l l us w h e r e t h a t w a s ? In t h e B a n k o f I r e l a n d . The B a n k of Ireland? Yes. I w o u l d s t r e s s t h a t t h i s h a d n o t h i n g at a l l to 27 do w i t h G u i n n e s s 28 overseas. 29 r e a l l y i f y o u w a n t to k n o w t h e g e n e s i s o f t h a t m o n e y Now, & Mahon, b u t it w a s m o n e y t h a t w a s a l o t o f t h a t -- w e l l , I don't know 1 or it is o f a n y i n t e r e s t to you. 2 m o n e y was m o n e y that was p a i d to me b y p a t i e n t s who 3 were non-Irish. 4 £10,000 5 p e o p l e l i k e t h at . 6 w o u l d c e r t a i n l y not have b e e n known to the Re v e n u e 7 C o m m i s s i o n e r s at t h e t i m e. 8 other money, 9 w h a t e v e r it was. 10 1 0 6 Q. 11 A. 12 107 Q. 1993. 13 A. 1993, 14 108 Q. 15 16 A l o t of t h a t S o m e o f t h e m o n e y c a m e -- a c t u a l l y , came in f r o m the E m i r of Bahra i n . Some of the m o n e y was m o n e y that But, again, A. t h e w h o l e t h i n g c a m e b a c k i n 19 At the time of the amnesty? Everything, yes. yes. That money, anyway, h o w d i d y o u p h y s i c a l l y m a n a g e to I d o n ' t know. That was done t h r o u g h the accountants. 18 1 0 9 Q. 19 A. 20 110 Q. Through Crann & Lennon? C rann & Lennon, yes. W h o in C r a n n & L e n n o n s p e c i f i c a l l y d ealt w i t h your 21 a f f a i r s at t h a t t i m e a n d w o u l d h a v e b e e n 22 ...(INTERJECTION). 23 A. Mr. Lennon, 24 111 Q. Mr. Patrick Lennon? 25 A. Mr. Patrick Lennon, 26 112 Q. 27 29 like the g e t t h a t i n t o y o u r a c c o u n t h e r e at t h e t i m e ? 17 28 Various particularly. yes. T h e m e c h a n i c s t h e n of t h e t r a n s f e r s of m o n i e s w e r e dealt with by whom? A. The mechanics, again, put m o n e y overseas, t h i s w a s -- at t h e t i m e t h a t it w a s a tim e, if yo u remember, I 1 extremely high taxation. I did what I shouldn't 2 h a v e don e, b u t w h a t a lot o f o t h e r p e o p l e a l s o did. 3 Initially, Mr. 4 w i t h t h i s a n d he se t u p s o m e s o r t o f a c o m p a n y in 5 t h e I s l e of Ma n. 6 t h e r e w e r e two. 7 b e i n g a n e x t r a o r d i n a r i l y c o m p l i c a t e d t h i n g t o do, 8 because 9 to put the money, Crann was the p e rson who was dealing In fact, Again, I t h i n k at o n e s t a g e a l l o f w h i c h s t r u c k m e as I h a d felt that the sim p l e st to do w o u l d be say, in t h e B a n k o f I r e l a n d or 10 whatever. 11 much, 12 administration, 13 be c o m i n g a bit a n n o y e d about this and u l t i m a t e l y 14 insisting, 15 w a n t t h e m o n e y in a b a n k , " a n d t h e m o n e y t h e n 16 r e v e r t e d at s o m e s t a g e i n t h e 8 0 's t o t a l l y i n t o t h e 17 B a n k o f I r e l a n d in t h e I s l e o f Man, 18 w h e n it c a m e b a c k t o I r e l a n d e v e n t u a l l y . 19 113 Q 20 A I d i d n ' t a g a i n s e e m to b e n e f i t me v e r y b e c a u s e a l o t of t h i s m o n e y s i m p l y w e n t in i n fees, "L ook, in w h a t e v e r . I remember I d o n ' t w a n t a n y of t hi s , I just w h e r e it w a s P r i o r to t h a t it w a s w i t h s o m e c o m p a n y ? Yes. Now, t h a t w i l l b e c o m e m o r e a p p a r e n t w h e n we 21 d e a l w i t h t h e l a s t t w o l i n e s o f m y s t a t e m e n t t o you. 22 W e w i l l h a v e to w a i t u n t i l t h e d o c u m e n t s c o m e in. 23 Again, 24 114 Q 25 A 27 115 Q 29 C a n I a s k you, settle monies 26 28 Yes. w e t h i n k w e know, Mr. but we are not certain. Neligan, did you ever in a T r u s t ? No. O r w e r e y o u e v e r t h e b e n e f i c i a r y of a n o v e r s e a s Trust that was set up o n y o u r b e h a l f ? 1 116 Q 2 A No. I t h i n k w h e n you r e a d t h r o u g h m y thing, I think 3 I c a n a n s w e r h o n e s t l y -- I h o p e I h a v e b e e n as 4 h o n e s t as I c a n be, 5 t h e o n l y t h i n g is u n d e r I t e m 4 t h e r e a n d I t h i n k a l l 6 of t h e s e t h i n g s , 7 A n s b a c h e r Cayman, 8 the house, 9 commercial, pr o b a b l y too honest. I think w h e r e I came into the a m b i t of s e e m s t o h a v e b e e n o n t h e l o a n fo r a n d I t h i n k e v e r y t h i n g that says y o u h a v e al l t h e d o c u m e n t s a n d a l l t h e 10 ledger statements there from Guinness & Mahon. 11 one t hi n g we don't have f rom Gu i n n e s s & Mahon, 12 w e h a v e b e e n t r y i n g f o r a l o n g t i m e n o w t o g et 13 documentation, 14 particular accounts, 15 117 Q 16 17 The and is t h e o p e n i n g o f t h o s e t w o w h i c h a r e t h e 60 a n d t h e 30. T h a t o p e n i n g w a s u p o n t h e t r a n s f e r of t h e m o n i e s f r o m t h e I s l e of M a n ? A Yes. T h a t h a s a l w a y s b e e n -- I a m s o r r y t o cut 18 a c r o s s y o u now, 19 m y w i f e a n d I, w e a l w a y s 20 c o m f o r t was m o n e y that h a d come f r o m the Isle of 21 Man. 22 118 Q Ms. Mackey. In t h e f o l k m e m o r y of felt that the s e c u r i t y W h e n t h a t m o n e y c a m e f r o m t h e I s l e of M a n a n d w h e n 23 the two accounts were opened, 24 time the two accounts were opened? 25 If I was, 26 truth. 27 l o o k i n g at it in t h e d o c u m e n t a t i o n he r e , 28 b e t h a t w e r e c e i v e d a l l o f t h i s i n 2 R o c k Road, 29 Blackrock, w e r e y o u a w a r e at t h a t I h a v e n o m e m o r y o f it. T h a t is t h e L o o k i n g b a c k on a l l o f this , when I am it m a y w e l l a n d t r a n s m i t t e d it o n t o o u r a c c o u n t a n t s , 1 b u t w e s i m p l y d i d n o t -- o u r f i n a n c i a l a f f a i r s w e r e 2 m a n a g e d b a s i c a l l y by our accountants. 3 W h a t is p u z z l i n g m e is t h i s ; 4 h a d a d v a n c e d you £ 90,000 a nd what was to be a 5 c o m f o r t to t h e m w a s t h a t a n e q u i v a l e n t 6 lodged with them? 7 A But suppose. 9 b o r r o w e d f r o m them. 120 Q Yes, b u t in f a c t an e q u i v a l e n t to h a v e b e e n l o d g e d w i t h th e m . 12 Guinness 13 lodged, A Well, & M ahon was £60,000. i n fact, What was lodged with The other £30,000 was with Ansbacher? I never had any dealings with anybody other than Guinness 16 d e a l t w i t h a n y i n d i v i d u a l w h o said, 17 C a y man," or whatever. 18 considerable 19 but that came later. 20 not the same bank. 121 Q 22 A No, 24 themselves But, that , "I a m A n s b a c h e r I did have very I am assured, That came in the is 9 0 's. I did not deal with anybody who identified as b e i n g A n s b a c h e r . I won't ask any more questions, C o s t e l l o w i l l c o n t i n u e now. 27 T h a n k you. 29 we n e v e r f i n a n c i a l d e a l i n g s w i t h A n s b a c h e r Bank, 26 28 A s I say, Incidentally, T h a t is H e n r y A n s b a c h e r . No, 122 Q & M a h o n in Dublin. it is not. 23 25 I sum does not appear 15 21 sum w o u l d be I was p a y i n g int e r e s t on what I had 11 14 & Mahon I w a s p a y i n g i n t e r e s t o n t h e e q u i v a l e n t sum, 8 10 that Guinness Mr. Neligan. Judge T h a n k you v e r y much. 1 COSTELLO 2 3 4 MR. JUSTICE COSTELLO: 5 I j u s t w a n t t o s e e if I u n d e r s t a n d t h e p u r p o r t of 6 your evidence, Mr. 7 £90,000 f o r t h e p u r c h a s e of y o u r h o u s e , 8 help finance the p u r c h a s e of the house? it w a s Neligan. W h e n you b o r r o w e d the 9 A Yes, your Honour. 10 124 Q Now, you had considerable borrowings at t h e tim e, 12 A 13 125 Q Yes . It w a s s u g g e s t e d by the b a n k that there should be 14 t h e s e d e p o s i t s to e q u a l t h e £ 9 0 , 0 0 0 ; 15 correct? A To the best of m y knowledge, sir, is t h a t it is c o r r e c t . 17 B o t h Mr. 18 identify the pers o n who made that suggestion and I 19 cannot. 20 126 Q No, R o w a n a n d Ms. M a c k e y a s k e d m e c o u l d I w e n e e d n ' t go i n t o t h a t . Y o u h a d t h i s m o n e y in 21 t h e I s l e o f M a n a n d it w a s t r a n s f e r r e d , 22 was t r a n s f e r r e d to Du b l i n ? 23 A I believe so, your Honour. As I say, the £90,000 we do not 24 e x a c t l y h ave the d o c u m e n t a t i o n r e l a t i n g to the 25 o p e n i n g of those, 26 in a d d i t i o n to t h e £ 9 0 , 0 0 0 ? 11 16 to 127 Q b u t t h a t is m y m e m o r y o f it. I d o n o t w a n t to g o i n t o a n y g r e a t d e t a i l a b o u t t h e 27 m o n e y i n t h e I s l e o f Man, 28 w h e n t h e t a x a m n e s t y w a s e s t a b l i s h e d i n 1992, 29 f a c t t h a t y o u h a d n ' t p a i d t a x o n f u n d s t h a t w e r e in but, as I u n d e r s t a n d it, the 1 the Isle of M a n was p a r t of the a c c o u n t s that you 2 gave into the Revenue then? 3 Yes, 4 s u r e t h i s is o b v i o u s l y n o t t h e T r i b u n a l t o do it, 5 b u t t h a t n o t al l of t h e m o n e y in t h e I s l e o f Man, 6 fact, 7 Revenue. 8 ...(INTERJECTION). 9 128 Q your Honour. I w o u l d a l s o p o i n t out, There had been Building Society accounts Fair enough. Well, the n, deposits 11 b e u s e d as a c o m f o r t , 12 that were outstanding? A 14 129 Q 15 A 16 130 Q Yes, in G u i n n e s s your Honour, yo u w e r e the o w n e r of & Mahon, £90,000, you thought, Yes . A r r a n g e m e n t s w e r e t h e n m a d e as t o t h e u s e t o b e p u t 18 g i l t s w e r e to b e p u r c h a s e d b y it? Yes, is t h a t rig ht , a n d I t h i n k t h e r e is d o c u m e n t a t i o n a b o u t t h a t in w h a t we h a v e g i v e n you there. 20 21 131 Q 22 A 23 132 Q 24 25 for the loans That was their word? of t h e m o n e y t h a t w a s o n d e p o s i t , A w h i c h w a s to but that was not m y word. 17 19 Did you know about that? I presume I m u s t hav e . Y o u m u s t h a v e k n o w n the n, Mr. Neligan, the amount t h a t w a s b e i n g p u r c h a s e d in g i l t s ? A in w a s m o n e y t h a t h a d n o t b e e n d e c l a r e d to t h e 10 13 and I am I w o u l d p r e s u m e so, 26 v e r y trite, 27 basically, 28 say, 29 benefit, your Honour. b u t it is t r u e . This m a y sound What w o u l d happen, is t h a t s o m e b o d y w o u l d c o m e t o us a n d "Listen, w e a r e d o i n g thi s, t h i s is f o r y o u r sign this," and we w o u l d have c l e a r l y 1 2 133 Q 3 4 W h e n you say "somebody", do y o u m e a n y o u r accountant ? A The account, probably, yes. In m y w h o l e e x i s t e n c e , 5 I was o n l y in the b u i l d i n g of G u i n n e s s 6 i n m y life. 7 134 Q & Mahon once It l o o k s as i f it w a s t h e m a i n p e r s o n t r a n s a c t i n g 8 this arrangement with Guinness 9 accountant ? 10 A 11 135 Q 12 A Yes . 13 136 Q Well, Yes, & Mahon was your he t r a n s a c t e d a l l m y b u s i n e s s . All your business? then , yo u k n e w t h e n that t h e r e was £ 6 0 , 0 0 0 of 14 t h e m o n e y t h a t w a s on d e p o s i t g o i n g t o b u y g i l t s a n d 15 t h a t w a s g o i n g to h e l p p a y t h e i n t e r e s t o n t h e loan. 16 W h a t d i d you t h i n k was h a p p e n i n g to the other 17 £30,000? 18 W h e n you say that 19 s a i d n o w a n d as I l o o k at t h e d o c u m e n t a t i o n , 20 it now, 21 these documents 22 g e n u i n e l y n o t h a v e h a d h e f a i n t e s t idea, 23 p robably would have told you a completely different 24 st or y, 25 w e h a d b o r r o w e d t h i s m o n e y a n d t h a t t h e s e c u r i t y fo r 26 it w a s m o n e y t h a t h a d c o m e in f r o m t h e I s l e o f Man, 27 a n d I h a d no i d e a o r h a d n o r e c o l l e c t i o n o r if I w a s 28 t o l d I s i m p l y d i d n o t u n d e r s t a n d t h a t p a r t of it, 29 t h a t it h a d b e e n s p l i t in two. but I k n e w t h a t t h e £ 6 0 , 0 0 0 -- as y o u I know I a m n o t c l e a r l y -- if I h a d n o t h a d a l l because r e c o v e r e d f r o m the bank, I would and I I had the ve r y simple impre s s i o n that I still don't 1 2 137 Q. Yes, w e m a y b e a b l e t o f i n d t h a t o u t la t e r , but what 3 I a m c o n c e r n e d a b o u t n o w is th i s ; 4 k nown t hen that the m o n e y on de p o s i t was ear n i n g 5 interest. 6 on the interest that was b e i n g earned? 7 A. that you must have Were you aware whether tax was being paid A s I s a i d to Mr. Rowan, I, in fact, was very 8 d i s s a t i s f i e d w i t h t h e p e r f o r m a n c e of t h e w h o l e 9 thing. 10 138 Q. 11 12 A. No, no, if yo u w o u l d n ' t m i n d a n s w e r i n g the question, Mr. Neligan? I w o u l d have assumed, sir, that tax was - ­ 13 certainly, 14 r e f e r e n c e to D I R T t a x w h e n it w a s b e i n g p a i d . 15 1 3 9 Q. in t h e r e f e r e n c e t h e r e , t h e r e is Did you know w h e t h e r tax was b e i n g p a i d on the 16 i n t e r es t that p r e s u m a b l y was b e i n g e a r n e d on the 17 deposit? 18 A. 19 140 Q. 20 A. 21 141 Q. I w o u l d p r e s u m e not, sir. You p r esume not? I p r e s u m e not, but I do n o t h a v e c e r t a i n k n o w l e d g e . It w a s b e c a u s e o f y o u r u n e a s e o r d i s s a t i s f a c t i o n that you left the accountants? 22 23 A. 24 142 Q. Yes. W a s this , Mr. Neligan, because you p r e s u m e d that tax 25 h a d not b e e n p a i d an d that this was an 26 u n s a t i s f a c t o r y s i t u a t i o n a n d y o u w i s h e d to 27 r e g u l a r i s e it? 28 29 A. P a r t l y tha t, sir. I w i s h I c o u l d p u t a h e a d on 1 of l a c k o f r a p p o r t a n d a f e e l i n g t h a t I w a s n ' t 2 getting information. 3 k n o w h o w e x a c t l y t h e r e m a i n i n g m o n e y t h a t I h a d in 4 the 5 s l i p s of p a p e r r a t h e r t h a n 6 T h e n it w a s n ' t b e c a u s e o f y o u r f e e l i n g t h a t it w a s 7 u n w i s e to r e t a i n t h i s p o s i t i o n of b e i n g l i a b l e f o r 8 tax, 9 accountants? Isle of M a n was doing, A 11 144 Q Multiple factors? 12 A Multiple factors, 13 145 Q Yes, there were multiple 15 a v a i l of the a m n e s t y ? 146 Q ...(INTERJECTION). factors. It w a s w h e n y o u w e n t to y o u r n e w a c c o u n t a n t , Mr. W o o d s , 17 I u s e d to get little yes. 14 A w h e n I w a n t e d to it w a s b e c a u s e o f d i s s a t i s f a c t i o n w i t h y o u r 10 16 For example, Yes, that he then a d v i s e d you that you should sir. Y o u a v a i l e d o f t h e a m n e s t y in r e l a t i o n t o t h e 18 interest, 19 a n d w h a t e v e r t a x l i a b i l i t y m i g h t h a v e r e m a i n e d in 20 r e l a t i o n to t h e I s l e of M a n ? 21 A 22 147 Q 23 A 24 148 Q 25 A Yes, the tax on the int e r e s t on the de p o s it s your Honour. B o t h of t h o s e ? Everything. Everything? Yes, everything that went through Guinness & Mahon, 26 the deposits, 27 r e s i d u a l m o n i e s that still r e m a i n e d in the Isle of 28 Man. 29 Mr. Neligan, the interest earned by them and any I am just w o n d e r i n g w h y you d i d not 37 1 t e l l us i n t h i s 2 m o r n i n g that you h a d a v a i l e d of the a m n e s t y and that 3 yo u h a d come to the v i e w that yo u h a d n ' t p a i d tax 4 a n d t h a t y o u s h o u l d h a v e p a i d it? 5 omitted from the statement? 6 Mr. 7 150 Q 8 A 9 Lavery has s tatement that you h a n d e d in this s a i d it is b e c a u s e w e w e r e n o t a s k e d . D i d y o u n o t t h i n k it w a s r e l e v a n t f o r o u r i n q u i r y ? I t h o u g h t t h a t y o u w i s h e d to a s c e r t a i n , what had happened. a v a i l e d of the amnesty, 11 w o u l d b e in y o u r r e m i t o r not. 151 Q V e r y well. Well, sir, exactly The fact that I s u b s e q u e n t l y 10 12 W h y was that I d i d n ' t k n o w w h e t h e r it I t h i n k t h a t is all. Mr. Neligan, 13 I d o n ' t t h i n k t h e r e is a n y t h i n g f u r t h e r w e n e e d to 14 ask you today, 15 consider these documents? 16 A 17 152 Q b u t o b v i o u s l y w e a r e g o i n g t o h a v e to Yes . W e w o u l d l i k e f o r m a l l y t o go t h r o u g h t h e m a t t e r s 18 with your wife tomorrow, 19 today? 20 A Yes. As I s a i d t o you, since they have been raised your Honour, 21 shared accounts and everything. 22 m o r e of t h e f i n a n c i a l 23 153 Q my wife and I She w o u l d have done ...(INTERJECTION). We m a y be able to get f u r t h e r i n f o r m a t i o n t omorrow. 24 In fact, 25 about. 26 your former accountants, 27 Mr. Lennon which 28 Mr. Crann, 29 h a s b e e n v e r y ill. there was another m a t t e r I m e a n t to ask you If w e w a n t e d to c o n t a c t y o u r a c c o u n t a n t s , is it Mr. C r a n n or ...(INTERJECTION). I think, is t h e s e n i o r p a r t n e r , b u t he I m u s t tell you that in the 1 c o u r s e o f this, 2 myself, 3 y o u r m e m o r y of a l l of t h i s ? " 4 s p o k e to. 5 I a s k e d h i m did he have records and c o u l d I have any 6 records 7 have any records 8 1992 and t h e y s i m p l y d id not 9 I think, MS. 10 w he n this b e g a n to evolve, c o n t a c t e d C r a n n & L e n n o n a n d said, It w a s Mr. I, " W h a t is Lennon I H e s a i d h e h a d v e r y l i t t l e m e m o r y o f it. f r o m t h e t i m e a n d h e said, anymore, because no, he d i d n ' t I h a d l e f t t h e m in keep m y records beyond, 1 9 9 8 or 1999. MACKEY: Would they have passed y o u r r e c o r d s on to 11 12 Mr. W o o d s ? 13 A n y t h i n g t h a t t h e y h a d r e l a t i n g t o t h a t tim e, 14 a s k e d t h e m to p a s s e v e r y t h i n g t o Mr. W o o d s , 15 certainly, 16 tax amnesty, 17 w h a t e v e r t h e y g a v e Mr. W o o d s was, 18 154 Q MR. clearly, we and f r o m t h e p o i n t of v i e w of t h e t h a t w a s d on e . JUSTICE COSTELLO: But, how detailed I d o n o t know. W e c a n c o n t a c t Mr. W o o d s then? 19 20 A 21 155 Q T h a n k you, Mr. 22 A T h a n k you, your Honour. Yes, Mr. W o o d s is p r o b a b l y m o r e r e l e v a n t . Neligan. T h a n k you, Mr. Lavery. 23 24 E N D O F E X A M I N A T I O N O F MR. 25 COSTELLO N E L I G A N B Y MR. 26 27 28 29 THE E X A MINATION WAS THEN CONCLUDED JUSTICE UNDER OATH ON FRIDAY, 11TH F E B R U A RY 2000 1999 I h e r e b y c e r t i f y the f o l l o w i n g to be a t r u e an d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO M R . ROWAN FCA MS. M A C K E Y BL S o l i c i t o r to the Inspe c t o r s MS. M. C U M M I N S Interviewee: DR. PATRICIA NELIGAN Represented by : John Lavery L a v e r y K i r b y & Co Main Street Blackrock Co. Dublin WITNESS DR. P. N E L I G A N EXAMINATION MS. M A C K E Y MR. JUSTICE COSTELLO QUESTIONS 1 - 7 6 77 - 82 1 2 3 4 DR. 5 E X A M I N E D A S F O L L O W S B Y MS. PATRICIA NELIGAN, H A V I N G B E E N SW O R N , WAS MACKEY 6 7 1 Q. MS. MACKEY: Dr. Neligan, as y o u know, w h a t we a r e a n x i o u s to 8 9 c l a r i f y h e r e is t h e q u e s t i o n o f m o n i e s coming from 10 a n a c c o u n t in y o u r n a m e a n d g o i n g i n t o a n a c c o u n t in 11 t h e n a m e of G u i n n e s s 12 a l s o k n o w n as A n s b a c h e r ? 13 A. 14 2 Q. & M a h o n C a y m a n Trust, w h i c h is Yes. A s y o u know, we w e r e s p e a k i n g to y o u r h u s b a n d 15 y e s t e r d a y a n d it a p p e a r e d f r o m t h e e v i d e n c e g i v e n b y 16 y o u r h u s b a n d t h a t in s o m e w a y t h i s A n s b a c h e r a c c o u n t 17 a n d t h e s u m of m o n e y in it is c o n n e c t e d w i t h a l o a n 18 which you and your husband had from Guinness 19 in o r d e r t o p u r c h a s e a p r o p e r t y i n K e r r y ? 20 A. Yes. 21 3 Q. What & Mahon I r e a l l y w a n t to t r y a n d c l a r i f y t o d a y is w h a t 22 e x a c t l y t h a t c o n n e c t i o n is, 23 e x a c t l y t h e m o n e y is t h a t is in G u i n n e s s 24 C a y m a n T r u s t L i m i t e d in t h e n a m e of y o u a n d y o u r 25 husband. 26 A. 27 4 Q. if we can, and what & Mahon Yes. W e c a n s t a r t off, I think, 28 10285008. Ms. 29 statement, s t a t e m e n t No. with your account number Cummins will give you a cop y of that 1 of that account, and 1 w h i c h w e w i l l c a l l E x h i b i t No. 2 statement, 3 1986, 1. as y o u c a n s e e t h e r e , from Guinness T h i s is a d ated 11th December & Mahon? 4 5 5 Q. 6 A. 7 6 Q. 8 A. 9 10 Is t h a t a s t a t e m e n t of y o u r a c c o u n t ? The 11th D e c e m b e r 1986? At the top there. L o dged £60,000 and £30,000. the house; 7 Q. Yes, t h a t was to b u y is t h a t r i g h t ? I a m j u s t a s k i n g y o u fi rs t, c a n y o u c o n f i r m t h i s is your account? 11 12 A. 13 8 Q. 14 Yes. Now, we h ave h ere a n u m b e r of transa c t i on s . The account begins with a nil balance? 15 A. 16 9 Q. 17 Yes. Is t h i s a n e w a c c o u n t t h e n t h a t w a s o p e n e d at t h a t time? 18 A. 19 10 Q. 20 A. 21 11 Q. I p r e s u m e so, yes. You do not know? I d o n o t k now. It m u s t h a v e b e e n , It is p o s s i b l e t h a t it w a s a n a c c o u n t a l r e a d y o p e n e d t h a t h a d a n i l b a l a n c e in it. 22 23 A. 24 12 Q. I was just wondering? I do n o t k n o w that . On 23rd September, then, we h ave the first 25 t r a n s a c t i o n across this account, 26 actually, 27 transaction, 28 A. 29 13 Q. yes. no, so r r y , w h i c h is - ­ 9t h S e p t e m b e r is t h e f i r s t w h i c h is a c r e d i t of £ 6 0 , 0 0 0 ? Yes. I t h i n k t h e d a t e is n o t v e r y c l e a r t h e r e . 1 It is not. 2 11th September, 3 14 Q No, the As 9th, is t h e c r e d i t , 5 debit? A 7 15 Q Right, yes, £60,000, is it t h e 2 3 r d -- oh, is a de b i t , w h i c h is v e r y b a d here , 4 6 I s e e it he r e , sorry. u p at t h e top, and then on the 23rd you have a o k a y. S or ry , yes, I a m w i t h y o u now. T h i s is a c r e d i t l o d g e d to y o u r a c c o u n t . Now, can 8 yo u r e m e m b e r w h a t that c r e d i t r e p r e s e n t s or what 9 t h a t s u m of m o n e y r e p r e s e n t s a n d w h e r e it c a m e f r o m ? 10 A Where it c a m e from, to best of m y knowledge, was an a c c o u n t w e h a d i n t h e I s l e o f Man. 11 12 16 Q 13 A 14 This £60,000 Yes, came f r o m the Isle of Man? to b u y the house. Can I just put something, r a t h e r t h a n ge t m y s e l f t o t a l l y c o n f u s e d h e r e ? 15 17 Q 16 A Certainly. W e g o t a l o a n of £ 9 0 , 0 0 0 from Guinness & M a h o n to 17 b u y this house. 18 t h a t t h e y w o u l d n e e d s o m e m o n e y -- I g a t h e r it w a s 19 comfort money, 20 b a l a n c e this , 21 this if we h a d some e x t r a m o n e y s o m ewhere, 22 did, 23 a r r a n g e d t hen that £ 90,000 w o u l d come in in some way 24 f r o m t h e I s l e of M a n to b a l a n c e t h i s . 25 a m a b i t c o n f u s e d in m y h e a d as t o w h i c h 26 ...(INTERJECTION). 27 Of course. 28 n o t c o n c e r n e d w i t h t h e I s l e o f M a n m o n e y at all. 29 It w a s i n t i m a t e d t o us i n s o m e w a y or something, w a s t h e w o r d u s e d -- to a n d t h a t w e w o u l d b e e x p e c t e d to do w e h a d t h i s m o n e y i n t h e I s l e of M an. w h i c h we We T h a t is w h y I C a n I j u s t m a k e it c l e a r h er e , we are 1 A. Yes. T h i s a c t u a l l y is t h e m o n e y c o m i n g as t h e l o a n 2 money from Guinness 3 So r r y , 4 that Guinness 5 19 Q. Yes, is t h a t c o r r e c t ? I am asking you questions. & M a h o n w e r e g i v i n g us as a loan. & Mahon rather than from 7 A. Oh, ri g h t . 8 20 Q. No, I a m a s k i n g you. 9 A. 10 21 Q. Yes, Y o u d o n o t know; is t h a t it ? W e ll , just leave that 12 el s e. 13 M a h o n t o b u y t h i s h o u s e in K e r r y ? A. 15 22 Q. 16 A. 17 23 Q. ... it did. 11 14 T h i s is m o n e y this m o n e y in y o u r a c c o u n t a c t u a l l y came f r o m Guinness 6 & Mahon; perh a p s we could f o r a m o m e n t a n d go o n t o s o m e t h i n g A s y o u said, you got a loan from Guinn e s s Yes. The h ouse cost what? £90,000. Now, we h ave h ere a f a c i l i t y l etter f rom Gu i n n e ss 18 & M a h o n in r e l a t i o n t o t h a t loan, 19 w i l l p a s s to yo u a n d w h i c h we w i l l call E x h i b i t 20 No. 21 A. 22 24 Q. 23 A. 24 25 Q. 25 26 27 28 29 2. w h i c h Ms. Cummins T h a t is d a t e d 1 2 t h S e p t e m b e r 1986. Yes. That r e l a t e s to a f a c i l i t y of £ 6 0 , 0 0 0 ? Yes, ri g h t . The loan that you o b t a i n e d from G u in n e s s a loan for £60,000 A. & initially; & M a h o n was is t h a t c o r r e c t ? P l u s t h e r e is w a s a n o t h e r £ 3 0 , 0 0 0 c a m e f r o m G u i n n e s s & Mahon. 26 Q. T h a t is r i g h t , yes, t h e r e was, a n d w e h a v e -- w h i l e w e h a v e n o t g o t a f a c i l i t y l e t t e r i n r e s p e c t of 1 that, 2 A p p l i c a t i o n C o m m i t t e e s h o w i n g that the l oan was 3 increased 4 Yes, 5 27 Q 6 A ... we have the d o cu m e n t s from the Credit ...(INTERJECTION). to £30,000. some time l ater to ...(INTERJECTION). T h i s w a s e x p l a i n e d to me, I think, that they were 7 able to p r o d u c e £ 6 0 , 0 0 0 w i t h ease a n d t h e n t h e r e was 8 some other way that they p r o d u c e d the other £30,000. 9 I d o n ' t k n o w how, 10 28 Q 11 A 12 29 Q but The b a n k itself? T h e b a n k i t s e l f d i d this . I see. Now, at t h e s a m e t i m e t h e n m o n e y c a m e f r o m 13 another account 14 to p r o v i d e c o m f o r t , 15 for t h i s . 16 A 17 30 Q 18 19 ...(INTERJECTION). Exactly, o f y o u r s in t h e I s l e o f M a n in o r d e r as G u i n n e s s & M a h o n s a i d t o you, yes. W h a t h a p p e n e d to that m o n e y ? Was that m o n e y lodged into your account? A This was o b v i o u s l y brou g h t in f r o m t h e I s l e o f M a n 20 and the q u e s t i o n then was h o w Guinness 21 u s e it as -- " b a c k i n g " s e e m s t o b e a t e r r i b l e w ord, 22 I a m a f r a i d to u s e it n o w -- b u t as b a c k i n g f o r t h i s 23 lo a n. 24 it w o u l d go i n t o a Gilt. 25 31 Q 26 A 27 & Mahon would It w a s d e c i d e d t h a t it s e e m s t h a t £ 6 0 , 0 0 0 o f T h i s is £ 6 0 , 0 0 0 o f t h e I s l e o f M a n m o n e y ? Yes, w o u l d go i n t o a Gil t, a n d £ 3 0 , 0 0 0 w o u l d go elsewhere. 28 32 Q 29 A Who decided this? I c a n n o t say who d e c i d e d this. 8 It w a s e i t h e r t h e 1 ac c o u n t a n t s or the bank. 2 m o n e y a n d w e w e r e d o i n g w h a t w e w e r e t o l d w i t h it. 3 33 Q 4 A 5 You brought Oh, We just b r o u g h t in the it to w h e r e ? I d i d n ' t b r i n g it i n p e r s o n a l l y , the accountants b r o u g h t it in. 6 34 Q 7 A 8 35 Q 9 A They brought it i n t o t h e b a n k ? Yes . It w a s d e c i d e d t h a t £ 3 0 , 0 0 0 w o u l d g o e l s e w h e r e ? Well, I d i d n o t d e c i d e t ha t . I did not really 10 b a s i c a l l y k n o w w h a t w a s g o i n g on. 11 t h o u gh t that the m o n e y was g o i n g to s tay in the Isle 12 o f Man, 13 t h e l o a n. 14 take that money. 15 t h o s e d a y s a n d I a c t u a l l y t h o u g h t -- h o w e v e r , 16 b r o u g h t in, 17 a n d t h i s w a s t h e d e c i s i o n o f w h a t t o d o w i t h it. 18 T h i s w a s e n a b l e d b y o u r a c c o u n t a n t s t o t h e b a nk . 19 36 Q 20 A I actually it w o u l d b e u s e d t h e r e as b a c k i n g a g a i n s t If t h e l o a n c o l l a p s e d , that they would I w a s q u i t e t e r r i b l y s i m p l i s t i c in it w a s g i v e n t o t h e b a n k in s o m e f o r m o r ot h e r , W h e n d i d y o u l e a r n of t h i s d e c i s i o n ? Well, I knew that this m o n e y was g oing to be their 21 comfort f o r t h i s l o a n a n d it s o r t of w e n t f r o m 22 there. T h e r e w a s n o s o r t o f f l a s h of l i g h t s a y i n g 23 t h i s is w h a t is g o i n g t o h a p p e n h e r e . 24 of 25 37 Q ...(INTERJECTION). But yo u w e r e a w a r e that £ 6 0 , 0 0 0 in i n v e s t e d in a 26 Gilt. 27 that not right? 28 A 29 38 Q It j u s t s o r t That was through Mars Nominees, Yes . A n d h e l d i n t h e n a m e of M a r s N o m i n e e s ? I think; is 1 A. Yes. I n fact, t h e s e a r e a l l -- it h a d a c t u a l l y g o n e 2 o v e r m y he a d , 3 b u t p e o p l e p u t t h i n g s to us to s i g n t h r o u g h o u r 4 a c c o u n t a n t s a n d t h i s w a s m o n e y we w e r e n o t 5 c o m p l e t e l y h a p p y with anyway, 6 was th r o u g h the b a n k and we e x p e c t e d that e v e r y t h i n g 7 w o u l d b e d o n e in n o r m a l b a n k i n g w a y s . 8 39 Q. 9 obviously. P r o b a b l y w e h a d s i g n e d it, so w e s i g n e d a n d it Y o u w e r e a w a r e at t h a t t i m e t h a t £ 6 0 , 0 0 0 w a s g o n e into a Gilt? 10 A. 11 40 Q. 12 A. Yes. W h e r e did you t h i n k the o t h e r £ 3 0,000 was? I t h o u g h t it w a s b e i n g i n v e s t e d i n s o m e w a y in t h e b a n k or t h r o u g h t h e b a n k . 13 14 41 Q. 15 A. But you did not I h a d n o idea, know how? n ow . I h a d a b s o l u t e l y n o id e a . 16 m u c h so t h a t -- I m e a n , 17 Ansbacher and Guinness 18 s a i d I w o n d e r w h a t p o o r f o o l s a r e s t u c k i n th i s . 19 w ent from there. 20 42 Q. whe n we h e a r d about & M a h o n we b o t h l a u g h e d an d b e c a u s e as y o u s a i d t h e £ 6 0 , 0 0 0 22 enough and then there was a further £30,000 23 ...(INTERJECTION). A. It The l o a n f r o m the b a n k that came also in two stages, 21 24 So I a m so rry , se e m e d to be easy t h a t is w h y I w a s c o n f u s e d at t h e 25 beginning, b e c a u s e it s e e m s t h a t t h e y b r o k e d o w n in 26 b o t h w ay s , b o t h l o a n s b r o k e d o w n i n t h e s a m e way, 27 but coincidentally. 28 29 43 Q. That m o n e y then a p p a r e n t l y was lo d g e d to this 1 2 44 Q. 3 A. 4 45 Q. 5 A. The loan money. Oh, sor ry , the first loan? T h e m o n e y f r o m t h e b an k . T h e m o n e y w e g o t a l o a n f r o m t h e b a n k w a s g i v e n to the w o m a n we bo u g h t the h ouse 6 7 46 Q. 8 A. 9 47 Q. from. S t r a i g h t to h e r ? Yes. If I c o u l d j u s t p a s s y o u n o w a n i n t e r n a l m e m o r a n d u m 10 f r o m the b a n k again, 11 Pa t O ' D w y e r to I n v e s t m e n t s D e p a r t m e n t , 12 E x h i b i t 3. 13 A. 14 48 Q. C a n you see there, is h e a d e d "Mrs. 16 No. 17 l o o k i n g at. A. 19 49 Q. 1986, from a n d t h i s is T h a n k you. 15 18 dated 17th September 10285008", t h i s is m a r k e d " L o a n F i l e " a n d it Patricia N e l i g a n - Call D/A £60,000, w h i c h seems to be the a c c o u n t we w e r e Yes. "It w a s a g r e e d t h a t t h e a b o v e s u m s h o u l d b e w i t h d r a w n to p a y f o r a G i l t p u r c h a s e d b y P e t e r K e a n e in t h e n a m e of Mars Nominees Limited. W o u l d you pl e a s e note and a c k n o w l e d g e that the G i l t p u r c h a s e d is t o b e h e l d at a l l times to the o r d e r of L o ans D e p a r t m e n t ." 20 21 22 23 24 25 T h a t is t h e £ 6 0 , 0 0 0 26 A. 27 50 Q. 28 A. 29 51 Q. ...(INTERJECTION). T h a t is t h e G i l t one, yes. ... t h a t c a m e f r o m t h e I s l e o f M a n ? Yes. The r e a s on for the m o v e m e n t in y o u r a c c o u n t at t h a t 1 stage was £60,000 2 w a s l o d g e d t h e r e a n d w e n t o u t to b u y t h i s G i l t ? 3 A. 4 52 Q. c a m e o v e r f r o m t h e I s l e o f Man, T h a t s e e m s to b e c o r r e c t . Then, in the case of the £3 0 , 0 0 0 the a mount that 5 went ultim a t e l y into Ansbacher, 6 s e p a r a t e l y to y o u r a c c o u n t 7 that correct? 8 A. 9 53 Q. f r o m the Isle of Man; It s e e m s to h a v e b e e n l o d g e d -- if y o u l o o k b a c k at your statement, 11 Exhibit 12 A. 13 54 Q. 14 A. 15 55 Q. 16 A. 17 56 Q. 18 A. 19 57 Q. 20 A. Yes. 21 58 Q. Now, Yes, there the first document it w a s l o d g e d s e p a r a t e l y . It w a s l o d g e d l a t e r ? Yes. It w a s l o d g e d o n 6t h O c t o b e r ? Yes. T h e r e it s t a y e d u n t i l it w a s d r a w n o n 2 0 t h N o v e m b e r ? Right. W i t h some interest? it is t h a t s u m w i t h t h e i n t e r e s t a t t a c h e d t h a t w e s e e a p p e a r i n g in t h e G u i n n e s s 23 Trust statement. 24 NELIGAN)Exhibit 26 59 Q. I g a v e you, 1? 22 A. is Yes. 10 25 this arrived & Mahon Cayman (SAME H A N D E D T O DR. 4. T h a n k you. T h a t is t h e s t a t e m e n t t h a t w e s h o w e d y o u r h u s b a n d 27 y e s t e r d a y a n d it is t h e s t a t e m e n t t h a t i n f a c t h e 28 s e n t t o us w h e n w e f i r s t w r o t e t o him. 29 ever seen a statement like that before? Have you 1 2 didn't, 3 came in from Guinness 4 careless; 5 yeah", 6 M a h o n a n d s e n d it u p to t h e a c c o u n t a n t s . 7 w o u l d h a v e n o t i c e d if it h a d G u i n n e s s 8 is j u s t at t h e b o t t o m " G u i n n e s s 9 actually don't k n o w if t h a t w o u l d h a v e m a d e a n y 10 i m p r e s s i o n on. This was m o n e y I was not h a pp y 11 ab o u t , 12 w o u l d n ' t r e a l l y h a v e c o n c e r n e d m e -- w e l l, 13 arrived. 14 kn ow. B e t w e e n a l l t h e lo a n s , 15 house, the loans 16 banks, I don't 17 our house. 18 f i l e d it i n t o t h e p l a s t i c b a g fo r G u i n n e s s 19 60 Q. but I don't remember. & Mahon. p u t it i n t h e e l a s t i c b a n d u n d e r G u i n n e s s & Mahon. It & Mahon Cayman". the loans for the rooms, I had they I don't for the the loans to the know how m a n y statements came into I h a d p l a s t i c b a g s in b a n d s a n d I j u s t & Mahon. A r e y o u a b l e to c o n f i r m n o w t h a t t h e m o n e y i n t h i s that came o v e r to y o u r a c c o u n t 22 Man, 23 ...(INTERJECTION). 61 Q. I think I T h e y m a y or m a y not h a v e arrived, 21 25 & it h a d s u d d e n l y g o n e i n t o t h i s t h i n g a n d it Guinness A. I know I was I w o u l d l o o k at t h e t o p a n d s a y "Oh, 20 24 I know statements & M a h o n C a y m a n T r u s t is i n f a c t t h e m o n e y f r o m t h e it I s l e o f m o v e d out of your ac c o u n t a g a i n a nd into this It d i d n ' t c o m e f r o m a n y w h e r e else . Y o u r h u s b a n d w a s e x p l a i n i n g to us y e s t e r d a y t h a t 26 m o n e y c o m i ng from the Isle of M a n and m o n e y g oing 27 into this account w o u l d have r e p r e s e n t e d some of his 28 fees. 29 W o u l d it r e p r e s e n t a n y o f y o u r f e e s ? 1 much part-time and I sometimes don't get paid for 2 what I work. 3 62 Q This was a joint account? 4 A This was a joint account. 5 63 Q 6 7 Nevertheless, I didn't actually represent funds contributed by yourself? A No. Now, I would have is a small salary. It would 8 only be £5,000, £6,000 or £7,000 a year. 9 frittered it away on shoes for the children and the I 10 odd thing like that. 11 word to use again for £6,000 or £7,000, but in the 12 context of what we did, what Maurice earned, it was 13 not ...(INTERJECTION). 14 64 Q 15 A 16 65 Q 17 18 "Frittering" is a terrible It wasn't significant? Yes . Did you personally have any dealings with Guinness & Mahon Bank? A Not that I know of. Any dealings I had with 19 Guinness & Mahon Bank were done through out 20 accountants. 21 66 Q 22 A Did you ever meet Mr. Desmond Traynor? I have spoken with John about this. I cannot 23 remember meeting Desmond Traynor. 24 knowledge of that. 25 say 'no', but what I am afraid of is that somehow 26 something is going to turn up, a photograph of me 27 and Desmond Traynor. 28 67 Q 29 A I have know If I wasn't under oath, I would You don't remember ...(INTERJECTION). 1 2 68 Q 3 4 Did you ever meet Mr. Padraig Collery of Guinness & Mahon? A Not that I can remember. We did go into the bank -­ 5 at least I did. 6 and I wandered in, like 'Alice in Wonderland', and 7 signed whatever was there, again for maybe the loans 8 for the house or the deeds of the house and maybe 9 brought in something for Maurice to sign or both of Maurice very often wasn't available 10 us and sent them back in the post. 11 the most in the bank on two occasions for formal 12 things like that. 13 69 Q I think I was at I can actually only remember one. Can we just pass you another document which is the 14 statement closing this account of Guinness & Mahon 15 Cayman Trust, which by that time, in 1989, was 16 called Ansbacher Limited, but as you will see it is 17 the same account, simply entitled now "Ansbacher 18 Limited/College Re MP External Call Deposit 19 Account", and the number of the account is slightly 20 different. 21 Cayman Trust it was No. 06040233 and now it is 22 16040233, Exhibit 5? 23 A 24 70 Q 25 A 27 71 Q 29 I see that, yes. In fact, it is the same account and the same amount with the interest added? 26 28 When it was called Guinness & Mahon Yes . You will see there that on 18th April 1989 the balance standing in the account was withdrawn? 1 72 Q. 2 A. 3 73 Q. 4 5 Leaving a nil balance? Yes. I just must ask you now, have you ever since that date made use of the Ansbacher account? A. Absolutely no. Again, not to the best of my 6 knowledge. 7 dropped on me, but no. 8 74 Q. 9 A. 10 75 Q. 11 A. 12 76 Q. 13 14 I do not know what bombshell might be Well, I am not going to drop any bombshells? Yes. As far as you know ...(INTERJECTION). As far as I know, I did not. I don't think I need to ask you any further questions. A. Yes. 15 16 END OF EXAMINATION OF DR. NELIGAN BY MS. MACKEY 17 18 19 DR. NELIGAN WAS EXAMINED, AS FOLLOWS, BY MR. JUSTICE 20 COSTELLO 21 22 77 Q. MR. JUSTICE COSTELLO: 23 Just a couple of questions, Dr. Neligan. 24 This seems to have been handled almost completely by 25 your accountants; is that right? 26 A. 27 78 Q. 28 29 Yes. I hate doing this, but that is the truth. No, no, that is perfectly all right, I just want to 1 79 Q. 2 A. 3 80 Q. 4 A. 5 81 Q. 6 A. It was handled by your accountants? Yes. Did you actually talk to the accountants yourself? Yes. Who were you talking to? The two accountants we dealt with were Crann & 7 Lennon. 8 was his sort of junior. 9 word, but he seemed to do an awful lot of the work Crann was the principal partner and Lennon Maybe that is the wrong 10 and he was quite often out in our house. 11 was through Mr. Lennon. 12 82 Q. Did he give you any details at all of what was going 13 to be done? 14 proposed? 15 A. Mostly it No. Did he tell you what was being I mean, we knew that the money was going 16 somewhere to balance this, this other money that we 17 had lent. 18 the sense that we felt so long as it was safe and we 19 would get it back at the end or whenever this house 20 loan was paid off. 21 what they did with it. 22 but that is the way it was. 23 Guinness & Mahon, which is a bank, and I thought 24 banks were great. 25 MR. JUSTICE COSTELLO: It did not particularly brother us, in We didn't really care too much That sounds ridiculous now, We were dealing with Yes, very well, Dr. Neligan, that is all. 26 27 Thank you for coming. 28 husband to sign the transcript of your evidence, but 29 that will be arranged through your solicitor. We will require you and your THE EXAMINATION WAS THEN CONCLUDED 18 35/9 G+JV! bankers Our Ref: PO'D/SC . I2th September, 1966. Dr. Maurice & Dr. Patricia Neligan, Ben Inagh, 2, Rock Road; Blackrock, CO. DUBLIN Dear Sir & Madam, Following recent discussions, we have pleasure in confirming that we are prepared -to-plaoe-at- youp-diapoaal~a facility subject to the following terms and conditions:.»*, • ' Borrowers: Dr. Maurice Vfc Dr. Patricia Neligan. Amount: flfflnHXMKUSlxty Thousand Pounds) - Irish £. Purpose: The funds are being placed at your disposal to assist you In the purchase of a property in Dooks, Ca Kerry. Term: In accordance with normal banking practice all funds taken up are repayable on demand but in any case not later than 30th September, 1989. Aw/ We shall however review your account on an annual basis. Interest: v u t, ^ f ^ { ^ ' ' ", '»*•< j} t, M * " - '‘ Security: Tstovm: Uvi.OubUn T«f«»: 93807. ta : 72CS4X Oublln Qocumtn« a. We propose charging Interest on the loan at iHfltr-puft,.fixed. Interest will be debited by Ous account on on thei30th September, j to us your co your account m autu 31st December, 31st March and 30th June annually. We shall apply to you immediately , -after the aforementioned dates for payment of jntere3t * ■ Mra. Patrfcda'Nellgan D/A £80.000 No. 10285008 rfa'Nellgan - Call DA It was agreed that the above sum should be withdrawn to pay for a Gilt purchased by Peter Keaae In the name of Mars Nominees Limited. WoukWyou please noteand acknowledge that the Gilt purchased is to be held at alt times to the order of Loans Department. PO'D/SC G+M trrou* « >Af * K J A t f U C * * ' MUI d.-Mi'tn statement «q. ^0u^6J LEDGER f i l O f f c l C A L I S/A nwiauM mpanrMn 'ASf HC. llDfca* WWW -r • b * c * «ct ' * « OJ5l--«n CH. Inttun Mil OUMCt ■*.** CROSS ' NEWOCfUMS 0/A »T *.23 TCREM mEpa& IS tri=to cmital a/ c ustrtt OsQCTM IO CEO l?M0V»6 crO . iHTcnsr iurs c«m u 07OCT16 •ti.85 ZOHCVB6 0X J.M9 CAOSS . * £ T f < T I t » . TA X «••*» h\u/Am o u g h t fo i lU f f & O * ma o 0.00 40.000.00 30Y27I.32 »»*Te*MT IftUKEST EAMUO I* SUBJECT TO ftETENTIo* Tax 30.000.00 Ml.l* at is.oo « 60*000*00 0*00 30,000.00 30,0C0.« G +M SUIWCSS,’UHOMCATIUUt THUST/ COLUCt wish poinos cxtcrnal CALL D/A •BALANCEMOUCHTHM1UIID ZONOVMu . nrmssT mte chawed WH SU11MCSS HAHQMCAYtIA g u•■■ if* mmn s &h « aBh o i? 5 5 aneMail fj.lln 8ATdiptniJM W statcrckt ha. LEDGER 0*(MO*U MCC NO. . I 2M 0 M t 30,27«.3iJ,£ * V.%vrr* W«— <1*111111<.•mM.m IW W I LWCTVD/ CBKJflU C/0 D > c ; n n/v Coyy I t l k N i &wa •» I I A ft M liw M fovavl T» SUOM I SlfiSS.N •20.7# 17i•!< 37iin.» )t,ao.a» La very Kirby G i l m a r t in solicitors Office o f the Inspectors Ansbacher (Cayman) Limited 3rd Floor Trident House Blackrock County Dublin Re: 10th December 2001. Mr. and Mrs. Maurice Neligan Dear Sirs, We refer to previous correspondence and in particular your preliminary conclusion that Mr. Neligan was a client o f Ansbacher. We strongly urge that neither the law nor the evidence supports such a conclusion and the purpose o f this letter is to make a submission to that effect to you and to invite you to draw the final conclusion that neither Mr. nor Mrs. Neligan were a client o f Ansbacher. The facts do not seem to be in dispute. In 1986, Mr. Neligan entered into a transaction with Guinness & Mahon (Ireland) Limited (“Guinness & Mahon”) whereby he borrowed money from Guinness & Mahon while at the same time placing a deposit o f £90,000 with Guinness & Mahon, part o f which was used to buy gilts for Mr. Neligan which were held in a Guinness & Mahon nominee account. There was nothing remarkable or improper in any way about this transaction. At no time did Mr. Neligan know o f or have any dealings with Mr. Des Traynor or Ansbacher (Cayman) Limited. The £90,000 was put on deposit with Guinness & Mahon in an account in the name o f Mrs. Neligan. Entirely unknown to her and her husband, it appears that on the 20th November 1986, just over £30,000 o f this deposit was transferred to an account with Guinness & Mahon which had the name “Guinness Mahon Cayman Trust/College MP”. Neither Mr. nor Mrs. Neligan know why this was done and it was not done with their knowledge or consent. So far as Mr. and Mrs. Neligan were concerned, at all material times their funds were on deposit in Mrs. Neligan’s name in an account with Guinness & Mahon. The Neligans’ account with Guinness & Mahon was closed in 1989. They were not to be advised o f this as your investigations have shown. In support o f their preliminary conclusion that Mr. Neligan was a client o f Ansbacher, the Inspectors state: (Continued Overleaf) John L. Lavery B.C.L. 1 Main Street Ray Gilmartin Blackrock James Flynn_______________________________________________________________________ Co. Dublin ___________________________________________________________________________________ Tel: 2888333 Laura McGinley . Fax: 2831729 Incorporating e-mail: info@laverykirby./> Pauline Burke Lavery & Co. V.A.T. No. 9535253R "The Neligans enjoyed the use o f the funds on deposit by means o f a service provided, by Ansbacher whereby they were able to withdraw funds in Ireland. ” First, it should be noted that the funds were on deposit in the name of Mrs. Neligan and therefore any conclusion drawn should relate only to Mrs. Neligan. Secondly, it is not correct, with respect, to say that Mr. or Mrs. Neligan (as the case may be) enjoyed the use of this money "by means o f a service provided by Ansbacher. ” The Neligans did not enjoy this money by means of any service provided by Ansbacher. They “enjoyed” it in the sense of being able to withdraw the money on deposit as they wished because they had placed the money on deposit with Guinness & Mahon and with nobody else. The only service they received was a service from Guinness & Mahon in the nature of an ordinary call deposit account. The Inspectors state that it was by means of the service provided by Ansbacher that the Neligans "were able to withdraw funds in Ireland. ” Again, with respect, it was not through any service provided by Ansbacher that the Neligans were able to withdraw their money. They were able to withdraw it because they had a contractual entitlement to do so vis-a-vis Guinness & Mahon having placed the money on deposit with Guinness & Mahon. They neither requested nor received any service from Ansbacher. Conversely, it is instructive to ask the rhetorical question as to what was the service provided by Ansbacher to the Neligans? The fact that, unknown to the Neligans, their money was placed on deposit in the name of a third party, is hardly a service provided by that third party to the Neligans. The Neligans derived no benefit from having the money in an account in the name of a third party, did not request that the money be held in this fashion and were unaware of the existence or identity of the third party. Although the Neligans have no knowledge of this matter, we assume, with the benefit of hindsight, that putting the money on deposit in the name of “Guinness Mahon Cayman Trust/College MP” was done in some way at the behest of Mr. Des Traynor. Relying on the McCracken Report, one may speculate that Mr. Traynor was seeking to abrogate as much money as he could in whatever accounts he was controlling in the name of Ansbacher with Guinness & Mahon, presumably because there was a benefit to Mr. Traynor and/or Ansbacher in increasing his overall deposit base with Guinness & Mahon and thereby getting a better rate of interest (see the report of the McCracken Tribunal, pages 37-38). We emphasise again that none of this was known to the Neligans. They were not advised as can be seen from all the bank documents. But assuming that something like this represents the rationale for what was done, it would seem that the Neligans or their money were pressed into service for the benefit of Mr. Traynor/Ansbacher rather than the other way around. (Continued Overleaf) In other words, while no service was provided by Ansbacher to the Neligans, it seems as if the Neligans were, without their knowledge, put in a position of providing some benefit to Ansbacher. In Appendix D in relation to the Inspectors' powers and procedures furnished to Mr. Neligan under copy of a letter of the 22nd December 1999, the Inspectors describe four services apparently offered by Ansbacher to Irish residents in relation to deposits maintained by Irish residents with Ansbacher. The first of these services (which seems to be the only one which could conceivably be relevant to the Neligans) describes a situation where an Irish resident client who deposited money with Ansbacher "in the Cayman Islands or into an account maintained by the company [Ansbacher] in its name in another financial institution could request [Ansbacher] to withdraw funds from a deposit it kept in its own name in Guinness & Mahon (Ireland) Limited and pay him/her either by cash or by cheque (or to his/her order) the requested sum. The limit o f this facility was the sum deposited by the client with the company ... It appears to have been an important feature o f this service that the name o f the client would not appear in any o f the records o f Guinness & Mahon (Ireland) Limited ... ” Neither of the Neligans deposited any money with Ansbacher. The only deposit Mrs. Neligan made was with Guinness & Mahon. The Neligans had no facility to withdraw funds from an account maintained by Ansbacher with Guinness & Mahon because they had no knowledge or contractual relationship with Ansbacher or with Mr. Traynor and dealt exclusively with Guinness & Mahon in the ordinary way. It was not an important feature of the Neligans’ banking arrangements that their names would not appear in the banking records. On the contrary, the deposit account which Mrs. Neligan had with Guinness & Mahon was clearly in her own name and likewise, Mr. Neligan’s borrowings from Guinness & Mahon were in his name. No question of secrecy or concealment of names featured in any way in the Neligans’ banking transactions. We respectfully submit therefore that on the facts of the case, there is no evidence to suggest that the Neligans or either of them were a client of Ansbacher and that the evidence is, in fact, coercive in the opposite direction. There is also the question of what is meant by the expression “client” as used in the High Court Order. We note in passing that the only source of the obligation to identify “clients of the company” is the High Court Order itself since there does not seem to be any such provision in section 8 of the Companies Act 1990 which is concerned with investigating the affairs of the company and whether “persons connected with its formation or the management o f its affairs” have been guilty of some form of fraud or misconduct. (Continued Overleaf) The section does not appear to envisage or empower the Inspectors appointed under the section to identify clients or customers of the company in their report (save and insofar as the actual identities as distinct from the activities of such clients or customers may be relevant to properly reporting on the affairs of the company). It is our submission that it is not necessary to identify any clients or customers of the company in order to report on its affairs and that insofar as the activities of any particular client or customer have to be referred to in that context, they can be referred to by the appropriate letter, number or other symbol. We appreciate, of course, that the High Court Order (as distinct from section 8) refers to “clients of the company/’ It is a matter for the Inspectors to decide how they should act upon this part of the order having regard to the fact that it appears to be ultra vires the powers of the court under section 8. For present purposes, we simply reserve all our rights in relation to our contention that this part of the order is ultra vires the powers of the court under section 8. Leaving aside that point, the question remains as to what is meant by the expression “clients of the company” in the High Court Order. We make two submissions in that regard. First, we submit that looking at paragraph (b) of the order as a whole, the reference to clients of the company is sandwiched between the reference to identifying “a ll o f the parties who are either officers (including shadow directors) and agents o f the company ” and the reference to persons "who otherwise assisted in the carrying out o f the business at the relevant time. ” We respectfully submit that, properly construed, the reference to “clients of the company” must therefore be construed as meaning clients who were in some way involved or assisted in the carrying out of the business of the company whatever formal or informal status those persons may have had. Such a construction appears to us to follow from a consideration of paragraph (b) as a whole and is also a construction which brings the order within the ambit of the court’s power under section 8 since section 8 expressly refers to “persons connected with its formation or the management o f its affairs [who] have in connection therewith been guilty o f fraud, misfeasance or other misconduct towards it or towards it members. ” Since it is clear that neither of the Neligans were in any way involved in the setting up, operation or management of Ansbacher in any shape or form, they obviously could not come within the reference to “clients of the company” if the construction of this phrase in the order which we have urged is correct. Secondly, and in the alternative, since the company in question is a bank, the reference to clients of the company must mean customers of the bank and the question arises as to what is meant by a customer of a bank. (Continued Overleaf) It seems to be clear on the authorities that to be a customer o f a bank, one must have some sort o f knowing or conscious relationship with a bank which most usually takes the form o f having an account but which might extend to some form o f habitual service provided by the bank even if the person did not have an account with the bank. Thus, in Great Western Railway -v- London and County Bank (1900) 2 QB 464, a country rate collector who was well known to the bank had for several years been in the habit o f taking cheques collected by him to the bank’s local branch (where he had no account) which branch accommodated him by cashing the cheques across the counter (or, on occasion, crediting the proceeds to the account o f one o f the local bodies for which the rate collector acted). The House o f Lords held that he was not a “customer” o f the bank, Lord Davey saying: "It is true that there is no definition o f ‘customer’ in the Act;' but it is a well known expression, and I think that there must be some sort o f account - either a deposit, or a current, account, or some similar relation - to make a man a customer o f a banker. ” Ft is clear from the speech o f Lord Brampton that the usual sort o f bank account is not a strict precondition defining that a person is a customer: "It is not necessary to say that the keeping o f an ordinary banking account is essential to constitute a person a “customer ” o f a bank, fo r i f it were shown that cheques were habitually lodged with a bank for presentation on behalf o f the person lodging them, and that, when honoured, the amount was credited and paid out to such person (whether with or without any profit to the bank fo r so presenting them), I would not say that such transactions might not constitute such a person a “customer” within the meaning o f section 82, indeed, I think they would. But as between [the rate collector] and the bank, the transactions amounted to nothing o f the sort. ” If one does not have an account in this sense with the bank, then it would seem that there must be some element o f habitual or frequent commercial or monetary dealings between the bank and the person if the person is to be regarded as a customer. The Neligans never opened an account with Ansbacher. Their money was wrongly and improperly put into the name o f a third party (Guinness Mahon Cayman Trust/College MP) whose existence and identity was unknown to the Neligans. (Continued Overleaf) No transactions took place between Ansbacher and the Neligans and there were no frequent, habitual transactions o f the sort which would clearly be necessary if the Neligans were to be regarded as a customer o f Ansbacher. We respectfully submit therefore that both on the facts and the law, there is no basis for finding that either o f the Neligans were a client o f Ansbacher. Finally, and as we know you appreciate, a fundamental concern o f our clients is that to name somebody publicly as a client o f Ansbacher is tantamount to a statement that the person in question was evading tax through the use o f an Ansbacher account. Such a statement would be entirely untrue and unfair in relation to the Neligans. As Mr. Neligan acknowledged in his evidence to the Inspectors, he did have tax liabilities (but not connected with Ansbacher) which were fully disclosed in the 1993 amnesty and by virtue o f section 2(5) o f the 1993 Act Mr. Neligan is deemed to have satisfied all his tax liabilities and not to be in arrears o f tax. If, despite our submission, you still conclude that Mr. Neligan was a client o f Ansbacher and intend to so report to the High Court, we would be grateful if you would notify us o f this fact before finalising the form o f your report as we would wish to make submissions to you in relation to the way in which Mr. Neligan might be identified as a client. This is because, in that event, we intend to apply to the High Court for an order under section 11(4) o f the Companies Act 1990 that the High Court excise Mr. Neligan’s name from the report insofar as the report may be given to any third parties or published in any way. We wish to ensure that any reference to Mr. Neligan in the Inspectors’ report is in such a way that there will be no particular logistical or administrative difficulties in excising his name from the report should the court make an order under section 11(4). If you wish we are quite happy to make these submissions to you personally and you might afford us the opportunity to do so in the event you still intend proceeding as set out in your letter o f the 24th October Yours taithfullv. Lavery Kirby G i l m a r t in solicitors °Urref JL/RC. F RM C4D1 The Office o f the Inspectors Ansbacher Bank (Cayman) Limited 3111 Floor Trident House Blackrock Co. Dublin. C /N 0T O §£m ,, * ' • 21st December 2 0 0 1. RE: O ur client: Neligan Dear Inspectors, Thank you for your letter o f the 18th December enclosing revised preliminary conclusions in relation to Mr Maurice Neligan and Dr Patricia Negligan. We wish to make the following additional comments on the revised preliminary conclusions. 1. It does not seem possible to us for a person to be a client o f Ansbacher while at the same time being unaware o f such a client relationship. A client relationship on any definition (including the definition proffered by the Inspectors) requires some form o f consensual relationship which did not exist in the case o f either o f the Neligans. Therefore neither o f them should be found to be clients and we request that you alter your preliminary conclusion accordingly. 2. The factual statement: "The Neligans enjoyed the use o f the funds on deposit by means o f a service provided by Ansbacher whereby they are able to withdraw funds in Ireland” is, with respect factually incorrect. The Neligans did not “enjoy” the use o f their own funds by any service provided by Ansbacher. Dr. Patricia Neligan placed money on deposit with Guiness & Mahon (Ireland) Limited which account was subsequently closed. Her entitlement to those funds arose wholly and exclusively because she placed the funds on deposit with Guiness & Mahon (Ireland) Limited nobody else. She did not enjoy the use ofthe funds by means o f any service provided to her by Ansbacher. 3. The only connection at all with Ansbacher is the fact that unknown to the Neligans, funds belonging to Dr. Patricia Neligan were, unknown to her, moved into an account in the name o f Ansbacher. Even on the Inspectors’ own reasoning, this was not Mr Maurice Neligan’s money and so there is no basis whatever for concluding that Mr Maurice Neligan was a client of Ansbacher. (Continued Overleaf) John L. Lavery B.C.L. Main Street Blackrock Ray Gilmartin James Flynn ^>u^,n __________________________________________________________________________________ Tel: 2888333 , „ _ , Fax: 2831729 Laura tWcGinhy r i . Pauline Burke Incorporating Lavery & Co. . e-mail: tnfo@laverykirby.te V.A.X No. 9535253R 4. If, contrary to the above submissions, you still conclude that either Dr. Patricia Neligan or Mr Maurice Neligan were clients o f Ansbacher, we request that you amend the latter part o f the conclusion to read “although he [she] was unaware of this”. The uncontradicated evidence before the Inspectors is that neither o f the Neligans were aware that the money was moved without their knowledge into the Ansabacher account. Indeed, in the second paragraph o f the Inspectors’ preamble to the preliminary conclusions, the Inspectors so find. There is thus no warrant for the doubt or ambiguity created by the use o f the word “may” and a positive finding that the Neligans were not aware of the Ansbacher connection is compelled by the uncontradicted evidence. 5. For the record, vve should say that our clients do not accept the definition o f a client enclosed with their letter o f the 18th o f December which seems extraordinarily wide and beyond any conventional or commonly understood concept of a client. We would submit to you that under your finding our client cannot fall within your definition o f a client. Our client could not “directly or indirectly maintain any account which they had no knowledge o f ’. As we stated last week, our clients reputation has been severely damaged as a result o f the leak, our client has been unfairly treated in breach o f constitutional and natural justice. We await hearing from you. Yours faithfully j} \, LAVHRY KIRBY GILMARTIN E\rc\200l\ltttter.200l\neligan.m P36-37 Lavery Kirby Gilmartin solicitors The Office o f the Inspectors Ansbacher Bank (Cayman) Limited 3ld Floor Trident House Blackrock Co. Dublin. 71' January 2002. RE: Our client: M aurice Neligan Dear Sirs, Your letter o f the 21st o f December refers. We think it totally unfair in breach o f the tenants o f natural justice that you should publish something to the High Court which will damage our client’s reputation. We have made a very significant and serious submission to you that our client was not aware that he was a client o f Ansbacher even though we dispute the definition o f client. We further make the following salient points:1. Our clients could not have “enjoyed the use o f the funds” as found by you as the money was moved without his notice, only a portion of his cash was used in this transaction, there were no movements in or out o f the account and furthermore our clients loan in relation to the purchase o f his property was in September whereas this money was moved to Ansbacher in November so there was no “enjoyment” o f the funds provided by Ansbacher as we have previously submitted. 2. The Inspectors appear to have lost sight o f the relevant and salient facts and this is caused by having to submit in writing rather than being able to make the appropriate submissions and question the findings which in all Tribunals, enquiries or proceedings a person is entitled. 3. Our clients only option as a result of your decision on your procedures is to make an application to the High Court, this, however, publishes our clients name in the application and is totally unfair in the circumstances. 4. We have stated previously that under the provisions you have the right to make an application for directions o f the High Court and we would again request that you make an application and put these points forward and appoint someone to make the representations on behalf of the “clients” to protect their interests. (Continued Overleaf) John L. Lavery B.C.L. Ray Gilmartin James Flynn Laura McGinley Pauline Burke Incorporating Lavery & Co. Main Street Blackrock Co. Dublin Tel: 2888333 Fax: 2831729 e-mail: info@laverykirby.ie V.A.T. No. 9535253R Page - 2 ­ 7th January 2002. 5. The actions taken by you in your finding do not go sufficient far enough to protect our clients good name, undoubtedly there are those customers/clients o f Ansbacher who totally co-operated with the members o f the Bank in utilizing the schemes, it is quite clear that our client is going to get tarnished in subsequent reporting on this matter and our clients name will be damaged. 6. Is this the Inspectors intention? We think it is not, however, this is a natural consequence and we will put it to you to reconsider this matter fully. E\rc\2002\letters.2002\negligan P 1-2 A ppendix X V (97) M r O liver N icol l. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Oliver Nicol. a) Letter of 27 October 1982 - Guinness and Mahon to Orbit Investments Limited. b) Letter of 30 January 1991 - Ansbacher Limited to Guinness and Mahon. c) Letter of 6 August 1991 - Orbit Investments Limited to Guinness and Mahon. d) Letter of 30 October 1991 - Orbit Investments to Guinness and Mahon. r n - G+M BANKERS 27th. October 1982. The Secretary. Orbit Investment* Limited. Guinness Mahon Cayman Trust Limited. P.O.Box. 887. Grand Cayman, BRITISH WEST INDIES. Dear Sir, Following recent negotiations we confirm that we are prepared to place at your disposal a facility subject to the following terms and conditions. Borrower: Orbit investments Limited. Amountt Sterling Guineas -100,000 (One Hundred Thousand) or its equivalent in U.S.Dollars or any of the B.M.S. currencies. Purpose: The funds have been placed at your disposal to assist in the purchase of bloodstock. Term i In accordance with normal banking practice all funds taken up are repayable on demand but in any case not later than 1st.November 1985. Drawdown: By way of Loan Account in your name. Repayment: You have agreed to repay the loan out of cash flow within the period stated. Interest: We propose charging interest on the loan at 3* in excess of the cost to us of the relevant funds for the period opted for. Interest will be debited to the account and become payable at the end of each interest period. T <««n n ; M » OmWI*. T «h » : m Wgiew0««*l1 CillNi eeM*1. M o fM M U n O k M N i.H .OllllMlM tCHlln o w I.m . II HMH, A M . 8 m u— .J 4 A * . On**— . 0 4 . H I ■**»!■ J X - U w Jut. P .T .» C l » im .O . »■ »— U K**! c«4lM ic55wiBi5iiwi A IM W d M A d M M h llf t W i •««*»■'«*w As security for the loan w e shell require the enclosed Guarantee completed by Mr.Olivier Nicol. , In addition w e shell require y o u to deposit such documents of title that y o u receive in respect of the b l o o d ­ stock purchased. Insurance: It is a condition o f the loan that the bloodstock pu r ch as e d be adequately i n su re d at all times. Liquidity: If there shall be any Increase in the c o s t to us of m a k i n g or maintaining the loan b y an amount wh ic h w e d e e m material resulting f r o m any changes in the reserve or liquidity requirements to wh i c h w e may be subjected* then w e shall b e e nt it l ed to call for p a y m e n t of additional interest of such amount as w e shall certify as the amount required to compensate for such increased cost with effect from the date of notification. You shall b e at liberty within one month a f t e r such notification and witho u t paym e nt o f any premium o r penalty to repay the full a m o u n t of the facility outstanding together with interest at the rate applying p r i o r to notification. W e are p l e a s e d to be o f assistance to y o u in making this facility available and enclose herewith a copy of this facility letter f or signature b y your authorised signatories a n d return thereby confirming y o u r acceptance o f the loan on the terms mentioned. W e s h a l l require a copy o f a B o a r d Resolution authorising the borrowing. Perhaps y o u w o u l d b e good enough to also return the enclosed Gua rantee F o r m duly completed. Yours faithfully, fOE-'CyimtESS^,+ MAHON LIMITED. T.R.LEONARD. B A NK I NG MANAGER. PAT O'DWYER. B A NK I NG MANAGER. Ends/.. Watladto (M)MMU3/4 U k CP 4305 Please reply to: 42 FtawflUam Square Dublin 2. 171 t *? Tfel: 765144/763065 Fax:612035 Ite (n»«4MMiT t a v i d H u m p h r ie s , Bag., .o r M anager - O p e r a t io n s , m e s s ft M ahon L i m i t e d , C o lle g e G reen , LIN 2 . >ar D a v i d , D u ld y o u p l e a s e a r r a n g e t o l e t me h a v e f o r c o l l e c t i o n t w o rench F ran cs D r a fts a s d e t a ile d . The c o s t s h o u ld b e e b i t e d t o O r b it I n v e s t j n n t s L im ite d A c c o u n t N o .0 4 0 8 5 0 0 0 i n ach c a s e . F .F c s . 2 9 ,5 0 4 .7 6 p a y a b le t o M r. O . N i c o l F .F c s . 2 6 3 /7 5 p a y a b le t o M r . .0 . N ic o l Y ours s in c e r e l; J.D. Traynor. Tfllapbo "M653/4 T«t«x: Or aO5 42 FittwilUsm Square, Dublin 2. Ttel:765144/763065 Fn: 612035 P.O.taxU7 GrandCayman Cayman M m b BritishWestIikHm 6th August, 1991. M. D a v id H u m phries, E s q ., S e n io r Manager - O p e ra tio n s , G u in n e ss ft Mahon L im it e d , 17 C o lle g e G re e n , .— DUBLIN 2 . ' D ear D a v id , C o u ld yo u p le a s e a rra n g e t o l e t me have f o r c o l l e c t i o n a F re n c h P ra n cs d r a f t f o r P r . P c s . 3 1 ,6 8 5 .0 6 p a ya b le to M r. O l i v i e r N ic o l and d e b it A ccount N o .04085000. Y o u rs s in c e r e l y . F o r O R B IT INVESTMENTS LTD . JDT/AJW VX Vjxj T«l*phon«: Tetex: CP3 PX).Box M7 Grand Cayman Cayman Islands British Watt India Please reptyto: 42 Fitzwflliam Square, Dublin 2. Tel: 765144/763063 Fax* 612035 3 0 th O c to b e r , 1991 M. D a v id H u m p h rie s , E s q ., S e n io r M anager - O p e r a t io n s , G u in n e s s A Mahon L im it e d , 17 College Green, DOBLIN 2 . D ear D a v id , “ C o u ld you p le a s e a rra n g e t o l e t me have f o r c o l l e c t i o n a d r a f t f o r F . P c s . 3 6 ,3 7 6 .1 4 p a y a b le t o M r. O l i v i e r N i c o l and d e b it o u r A c co u n t N o .04085000. A l s o , c o u ld you p le a s e a rra n g e t o r o l l th e D e p o s it w h ic h m ature s on th e 8 th November f o r a f u r t h e r s i x m onths. Y o u rs s i n c e r e l y , SIGNATURE(S) VERIFED BY: J .D . Tra v n o r. GfcCaJEtc A ppendix X V (98) M r M ichael J O ’K eeffe, deceased 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Michael J O’Keeffe. a) Letter of 4 April 1972 - Guinness and Mahon to Michael J O’Keeffe. b) Telex of 13 July 1976 - Guinness and Mahon to GMCT. c) Internal Guinness and Mahon credit minute of 18 February 1977. d) Internal Guinness and Mahon file note of 24 February 1978. e) Internal Guinness and Mahon memo of 18 December 1984 - JD Traynor to Securities Department. Correspondence received from or on behalf of Mr Michael J O’Keeffe, a) Letter of 28 December 2001 from KSi Faulkner Orr to Inspectors. 17. iMMTtH MMW «MMMMtl CHAMHM* . ■HiMM •.W »>«W M I *HW H » «AV«Kf t.C’UiV* «««««•••« Am Coujcok Omikn. •••*«««•«*% D U B L IN , P .O .B O X SSA. M«M*%«. •*WIMIfl NAMiB •. («!■»»* ***«.**m. «4t», ttMNHM tlOlllV lC lM HlMMiM tMM »II4M Our Hof: „» PO'Djacb. 4th April, 1972 Mr. M.J. O ’ Keoffe, St. Marjarct s, Dray Hoed, Foxrock, CO. DUDT.iy. Dear Sir, Ve write to confirm our Agreoniont to sake availabla to you a facility to tho extent of £^0,000 (ritzy thousand pounds), on the following condicions:% 1. All funds to be availed of by y ou in the fora of a Loan Account. -'":-:;'-:' l - “:a ^ ^ l l ;- :^ a r tS £ £a d V a n : ^ 3. S. Ve propose to charge interost on the Loan Account at 9 VS Pcl* a » m m but we rosei‘ vo the right to review the interest rate at any tine. Intex-cst will be debited to tho account on the ’1st Decc:r.ber, 31st March, 30th June and 30th September annually. JTovever, wo w i l l apply to you for interest on the jlst March annually only. In other words you n a y take it that intorest will bo debited to the account quartorly a n d payable once a year . ' , As security / ...1. M r. M .J . O 'lC c e f f o . 4. .. / ■ continuation smict n* 'ith A n r l l . lT 7 g As s e c u r i t y you u n d e rta k e to p r o v id e us w i t h quoted S to c k Exchange S e c u r i t i e s c o v e r in g t h i s f a c i l i t y w i t h a a a r g i n o f 2 5 £ , i f c a l l e d up on to do s o . %‘e c n c lo s o a c o p y o f t h i s f a h e r e w it h , w h ic h k i n d l y s ig n and r e t u r n c o n f ir m a t io n o f y o u r a c ce p ta n ce o f the on th e t c r a s a e n t io n e d . No d o u b t yo u us i n due c o u rs e as to che d is p o s a l o f b e in g made a v a i l a b l e . - for a illt y la tte r, to us i n f a c ility Kill a d v is e tho fu n d s Yours faithfully, GDINN2SS & MASON’LTD. i . * TO * GUINNESS MAHON CAYMAN TRUST LTD FROM * GUINNESS + MAHON LTD DUBLIN 13TH JULY 1976 “ ATTENTION ' MIKE SHIELD RE YOUR LETTER OF 3RD JULY T3 RU. I HAVE TRANSFERRED U.S.OOLLARS 1 2 7 .9 0 TO^YOUR 7 D/N U.S.DOLLARS D/A IN LONDON AND DEBITED THE SUNORY SUB CO. JHAVEALSO DR.X3.GQ T.O THE SUNDRY SUB CO. . RE CHARGES FOR STATEMENTS. ' ... ....... .................. WOULD YOU PLEASE ADVISE ME I? YOU ^ E ^ U .S .O O JX ^ D/A MATURING FOR MICHAEL O'KEEFFE. I AM ‘JNASLE TO TRACE ANYTHING HERE ANO HE SEEMS TO THINK THERE SHOULD BE SOMETHING. REGARDS HELEN ' TlMEO ATt^ ' ' 17:03 305GUINNESS CP 5205 MARS El AB/EH ® ^ , If 11)77 M. J. O'Kftcffb, Ejqufr* - EXTENSION: Amoonfe £16, OCX) Turn On* year to 3litMarch, 1978. Rata: 15% fixed. Drawdown^ Already drawn fayway of loan. Balance outstanding £13,816. Sacurlty: RacomnwncM. Suitably wcurtd. •, RE; M O’ KEEFFE Loan In t e r e s t Rate 2 1 7 ,0 3 7 .0 0 15% f ix e d *vj ' Th e above f a c i l i t y llarch 1978. f a l l s due fo r repaym ent on th e 3 1 s t ........... F o llo w in g a re v ie w o f th e Account i t ' t w agreed to extend th e f a c i l i t y f o r a p e rio d o f one year to 3 l s t March 1979. Th e Loan is " S u i t a b l y S e cu rs d ’*. a l l c o n d itio n s a p p lic a b le t o the f a c i l i t y s h a l l re m a in as b o fo re , • . P. OiDwyer. ' ssjap " * c.c. C. A. W H.D. PO *D 'AC Continued,.» .» < C o a id y o u p l M M a r r u t g * t o p a t t h « m e l o a o d • n r « l o p « l a a a f a k o o p ln g u n d * r v t m n o * O .M .C .T . r * M io h jw l O'XMffl. n J D t /U f KSi Fauikiner O rr Office of the Inspectors, Ansbacher (Cayman) Ltd., 3rd Floor, Trident House, Blackrock, Co. Dublin. AC C OUNT ANT S TAX ADVI SORS & REGI STERED AUDI TORS I Adelaide C o u rt Adelaide Road Dublin 2 • Ireland Tel: (353-1) 475 3100 Fax: (3 5 3 -1) 475 3341 E-mail: info@ksifo.ie 28 December 2001 RE: MICHAEL J. O ’KEEFFE, DEC’D REF. NO. C/0’04/NSP Dear Sirs, W e have received your letter dated 10 December 2001 in connection with the above matter and note your comments together with enclosures. W e would advise that during his lifetime, the late Michael O'Keeffe outlined the various dealings in connection with Guinness & Mahon Bankers and his personal investments. At no time whatsoever did they include any reference to Ansbacher (Cayman) Limited nor any associated Ansbacher Account. It has transpired from subsequent meetings with both the Revenue and publicity in the news media that the late Des Traynor pooled funds in relation to Guinness & Mahon customers and invested these in Ansbacher (Cayman) without their knowledge. Mr. Michael O ’Keeffe was one of these and in the circumstances, should not in anyway be held liable under the Terms and Reference of your appointment. W e await hearing from you further. Yours sincerely, David Orr KSi FAULKNER ORR DavidOrr • DominickTighe Conor Kennedy • Declan Mulhall RegisteredOffice: I Adelaide Court Adelaide Road Dublin2 • Ireland VATRegistrationNumber: 9528743U A ppendix X V (99) M r M aurice O ’Kelly 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Maurice O’Kelly. a) Transcript of evidence of Mr Maurice O’Kelly dated 10 April 2000. b) Statement of Mr Maurice O’Kelly of 9 March 2000. c) Letter of 7 October 1993 - Hamilton Ross Co Limited to IIB. d) Letter of 2 September 1994 - Hamilton Ross Co Limited to IIB. e) Ansbacher Limited statement of 5 October 1992 re a/c no 80001643. f) Ansbacher Limited statement of 31 December 1992 re a/c no 80001643. g) Ansbacher Limited statement of 4 January 1993 re a/c no 80001643. h) Ansbacher Limited statement of 31 March 1993 re a/c no 80001643. i) Ansbacher Limited statement of 21 May 1993 re a/c no 80001643. j) Ansbacher Limited statement of 9 June 1993 re a/c no 80001643. k) Ansbacher Limited statement of 26 July 1993 re a/c no 80001643. 1) Ansbacher Limited statement of 31 October 1993 re a/c no 80001643. UNDER OATH ON MONDAY, 10TH APRIL 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. MAURICE O'KELLY Represented by: MR. BRIAN BOHAN BOHAN SOLICITORS 31a WESTLAND SQUARE DUBLIN 2 I WITNESS EXAMINATION MR. M. MS. MACKEY MR. JUSTICE COSTELLO MS. MACKEY 35 38 PAGE 34 37 39 1 2 3 4 MR. JUSTICE COSTELLO: Good morning. 5 MR. O'KELLY: Morning Judge. 6 MR. JUSTICE COSTELLO: My name is 7 Declan Costello and on my 8 right is Ms. Mackey. 9 who were appointed, as you know, by The High Court. We are two of the Inspectors 10 MR. O'KELLY: Sure. 11 MR. JUSTICE COSTELLO: I should explain to you 12 Mr. O'Kelly that this is 13 not a Court. 14 interview. 15 you some questions. 16 MR. O'KELLY: Right. 17 MR. JUSTICE COSTELLO: I want to make it clear It is not a Tribunal. It is an Ms. Mackey and myself are going to ask 18 however that if you have 19 any problem about the questions that we ask you, 20 that you would like to get advice on, you may 21 consult your solicitor and we will stop asking you 22 questions. 23 24 Similarly, if your solicitor has any problem with 25 questions that we might ask he can ask us to stop 26 and consult with you. 27 MR. O'KELLY: Sure. 28 MR. JUSTICE COSTELLO: The evidence will be taken 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 MR. O'KELLY: Sure. 1 2 AS FOLLOWS 3 4 MR. JUSTICE COSTELLO: Mr. O'Kelly, I am going to 5 ask Ms. Mackey to ask you 6 7 some questions. A. Sure. 8 9 MR. MAURICE O'KELLY WAS EXAMINED, AS FOLLOWS, BY 10 M S . MACKEY 11 12 1 Q. 13 A. 14 2 Q. MS. MACKEY: Mr. O'Kelly, good morning? Morning. You provided us with an agreed statement, an unsworn 15 statement, in writing. 16 would be simply to go through that? 17 A. 18 3 Q. 19 I think the simplest thing Sure. And perhaps clarify some of the matters that you have set out in this? 20 A. 21 4 Q. Sure. However, before I do that, for the record, I would 22 just like to get a brief history of your own career 23 and especially your career in Guinness & Mahon. 24 I understand it from your statement you joined 25 Guinness & Mahon in 1971? 26 A. 27 5 Q. 28 A. 29 6 Q. Yes. Is that right? 1971, yes, that is correct. Prior to that you were? As 1 Prior to that I q u a l i f i e d as a chartered accountant 2 in 1955. 3 7 Q 4 A 5 8 Q 6 A 7 9 Q 8 A 9 In 1955? Yes, 1955. Yes ? When I went to - - I went away to Hong Kong. Yes? My partner there died and I took over the firm, which I then sold in 1967, 49% of i t . 10 10 Q 11 A 12 11 Q 13 A 14 This i s in Hong Kong? In Hong Kong. Yes ? And I returned to Ireland in 1960 and in 1962 I sold the balance of my firm in Hong Kong. 15 12 Q 16 A 17 Yes? And s e t up a firm in Dublin, Merrion Square, c a l l e d Commercial Investment Advisers. 18 13 Q 19 A 20 Commercial Investment Advisers? Yes, and that was a company that s p e c i a l i s e d in the mergers and a c q u i s i t i o n s f i e l d . 21 14 Q 22 A 23 15 Q 24 A 25 16 Q 26 A 1963. 27 17 Q 1963? 28 A 29 Right? And venture c a p i t a l f i e l d . Yes. That was i n . . . ( INTERJECTION)? That company.. . (INTERJECTION). 1961 you say? Yes. In 1971 that firm was taken over by Guinness & Mahon. The connection there was 1 with Des Traynor who had become Managing Director 2 of G & M and he and I were A r t i c l e d Clerks 3 we became chartered accountants. 4 same firm as A r t i c l e d Clerks. 5 18 Q. 6 A. 7 19 Q. 8 A. 9 20 Q. 10 A. 11 We were in the In Haughey Boland? Haughey Boland, that i s r i g h t . Yes? We were both A r t i c l e d Clerks under Charles Haughey. Right? Now, my friend sh ip with Des dated from that date, 1951 approximately 1952. 12 21 Q. 13 A. 14 22 Q. 15 A. 16 17 before Around 19? 1951/52 I j o i n e d . . . (INTERJECTION). Haughey Boland? Haughey Boland as an A r t ic le d Clerk and that was the time I met Des Traynor for the f i r s t time. 23 Q. Right. It was through your acquaintanceship 18 with Des Traynor that the take over of Commercial 19 Investment Advisers? 20 A. 21 24 Q. 22 A. 23 25 Q. 24 A. Yes. By Guinness & Mahon? Yes. Came about, i s that right? Yes. I t wouldn't have been a very wise move from my 25 point of view because I c e r t a i n l y would have made a 26 l o t more money i f I continued to own Commercial 27 Investment A d v i s e r s r i g h t . 28 A. 29 26 Q. And continued to p r a c t i c e . Yes? 1 2 27 Q. 3 A. 4 28 Q. 5 A. 6 With Des? That the a c q u i s i t i o n of CIA by G & M in 1971. Right? I joined as Joint Managing Director then in Guinness & Mahon. 7 29 Q. 8 A. 9 30 Q. 10 A. 11 You joined Guinness & Mahon? Yes. As Joint Managing Director? Joint Managing Director with r e s p o n s i b i l i t y r e a l l y for corporate finance. 12 31 Q. 13 A. 14 32 Q. 15 A. 16 33 Q. 17 A. 18 34 Q. 19 A. 20 35 Q. 21 Yes? That p a r t ic u l a r si de of the bank a c t i v i t i e s . You continued on in Guinness and Mahon then u n t i l ? I resigned from G & M on 30th June 1985. 1985. What p o s i t i o n did you hold at that stage? In G & M? Yes? Just the same. Just Joint Managing Director. Joint Managing Director, that i s what you were a l l the time? 22 A. 23 36 Q. A ll the time, yes. That i s f i n e . Thank you Mr. O'Kelly. Getting back 24 then to your statement and to what you have ju st 25 t o l d me, your friendship with Mr. Traynor then dates 26 from the e ar ly 1950's? 27 A. 28 37 Q. 29 Yes, we were in A r t i c l e ' s together. Yes? 1 38 Q In your statement - - do you have a copy of your 2 statement with you, that you would l i k e to r ef er to 3 perhaps (Exhibit 1)? 4 A 5 39 Q 6 Yes . I f you see paragraph 5 of your statement there Mr. 0 ' Kelly? 7 A 8 40 Q 9 A 10 41 Q 11 Yes . At the bottom of the f i r s t page? R ig ht . You say: "All savings I had and proceeds of s a le of shares including (Atlantic Resources) were given to Mr. Traynor in Guinness & Mahon. I had joined Guinness & Mahon in 1971. I had c er ta in moneys at that time and t h i s together with subsequent r e c e i p t s were lodged with Guinness & Mahon through Mr. Traynor." 12 13 14 15 16 17 A 18 42 Q I f you would t e l l us Mr. O'Kelly how t h i s f i r s t came about? 19 20 Yes . A 21 What your f i r s t . . . ( INTERJECTION)? Well, the f i r s t - - going back in time I think when G & M bought Commercial Investment Advisers in 1971. 22 43 Q 23 A 24 44 Q 25 A Yes? I owned approximately 70% of the share c a p i t a l . Yes ? At that time the company was owned by Des Traynor, 26 the l a t e Eamonn Andrews and the l a t e 27 Christopher Gore Grimes, in equal percentages. 28 45 Q 29 A Yes? 1 46 Q 2 A And the proceeds of that s a l e , my share of the 3 proceeds of that s a le - - I am not quite sure - - was 4 in an account which would be l i k e a p r o fe s s io n a l 5 firm's account, rather l i k e partners in a l e g a l firm 6 or partners in an accounting firm. 7 47 Q 8 A 9 48 Q 10 A 11 49 Q 12 A Yes . 13 50 Q Yes? 14 A Yes? I f you l i k e an account to my c r e d i t . Yes ? With G&M which was p a i d . . . (INTERJECTION). In Guinness & Mahon? And to that account was lodged my s ala ry from G&M 15 and I wrote my own personal - - no - - yes, to that 16 account and then there was a personal account from 17 which I paid b i l l s and that kind of thing. 18 51 Q 19 A 20 52 Q 21 A Yes ? Yes, and there was debits to that account. Yes? So, that was the nature of that account, which may 22 seem t e r r i b l y casual. 23 you but I can't explain that o t h e r . . . (INTERJECTION). 24 53 Q Yes. 25 A Yes . 26 54 Q 27 A 28 55 Q 29 A It may seem very casual to However, that account was in Guinness & Mahon? Is that right? Yes . That was an ordinary account in Guinness & Mahon? Well, i t was an ordinary - - i t was an ordinary 1 account. 2 of I presume that other people had an account l i k e 3 that. It was an ordinary account in the context 4 5 A. But I mean in my case i t was in the nature of 6 an account which was a drawing account as w ell, 7 you know. 8 57 Q. 9 A. 10 Yes? I t was rather l i k e i f you were a partner in a l e g a l fi r m . 11 58 Q. 12 A. 13 59 Q. Yes? Or an accountancy firm. Yes. However, in r e l a t i o n to the monies that you 14 gave to Mr. Traynor, when did that arrangement begin 15 and how did that come about? 16 A. 17 That would have been the balance that was due to me from my s a l e of Commercial Investment Advisers, yes. 18 A. 19 60 Q. 20 A. 21 61 Q. 22 A. 23 62 Q. 24 A. 25 63 Q. 26 A. 27 64 Q. There was an amount due to me. Yes? Which I can't remember now what i t was. Yes? At the time. No, that does not matter? But i t was probably around £40,000/30,000, you know. Yes? Which does not sound very much. Yes. What happened about that? Did Mr. Traynor 28 suggest to you that i t be in ves ted or did you ask 29 him? 1 No, no. 2 j u s t there. 3 like . 4 65 Q 5 Nothing ever happened about i t . I t was It i s ju st my current account i f you However, may be I am not understanding e x a c t ly what you are saying? 6 A 7 66 Q 8 A 9 67 Q Yes . You say here at paragraph 5? R ig ht . "I had c er ta in moneys at that time and t h i s together with subsequent r e c e i p t s were lodged with Guinness & Mahon through Mr. Traynor." 10 11 12 13 When you say "through Mr. Traynor" what do you mean 14 there? 15 A Well, I think that l i k e - - I am not sure 16 whether that would be co rr e ct. 17 are r e a l l y t a lk in g about the opening of an account 18 in Guinness & Mahon. 19 68 Q 20 A 21 69 Q 22 A 23 24 I mean you Yes? Whether Des Traynor opened the account for me. Right? Or whether I opened the account a f t e r I joined G & M, I am not sure. 70 Q Obviously, what we are concerned here today about i s 25 to find out your connection with "Ansbacher" Cayman 26 Limited or "the company" as we r ef er to i t ? 27 A 28 71 Q 29 Yes . I think we might cut t h i s thing short by saying that i t appears that you acknowledge that you had, in 1 f a c t , de po s its with "Ansbacher" Cayman, i s that 2 correct? 3 Well, I don't know what you would mean by having 4 depo si ts with "Ansbacher". 5 account with "Ansbacher" that I can r e c a l l . 6 72 Q I never opened a deposit I t appears Mr. O'Kelly that in your interview 7 with Mr. Gerry Ryan, the authorised o f f i c e r to 8 the Minister? 9 A 10 73 Q 11 A 12 74 Q As a r e s u l t of which we were appointed? Yes . That you acknowledged to him that you did have an account with "Ansbacher" Cayman, i s that correct? 13 14 Yes . A 15 I mean I obviously had because I have been t o l d that I had. 16 75 Q 17 A 18 76 Q 19 A 20 This i s what we are tr yin g to get at? But I mean I never signed. No? Put i t t h i s way, I never signed a piec e of paper saying I wished to have an account. 21 77 Q 22 A Right? With "Ansbacher" and I never authorised the tr a n s fe r 23 of any money to "Ansbacher". 24 mean.. . (INTERJECTION). 25 78 Q What we are tr yin g to a s c e r ta in today i s , how i t 26 came about. 27 in v e s t money for you? 28 A 29 79 Q I No. He did not? Did Mr. Traynor at any stage o f f e r to 1 2 80 Q. 3 A. 4 5 D i d . . . (INTERJECTION)? And I wasn't in r ec e ip t of any i n t e r e s t that I know of. 81 Q. We w i l l come to th at . However, j u s t g e t t i n g back to 6 the opening of t h i s account, do you say now that the 7 account that you had with Guinness & Mahon i s the 8 account that some how or another subsequently was 9 transformed int o the "Ansbacher" account? 10 A. Well, a l l I am saying i s that i t would appear that 11 an account in my name, which would represent a sort 12 of personal account. 13 82 Q. 14 A. 15 83 Q. 16 A. 17 84 Q. 18 A. 19 85 Q. Yes? Was tra nsfe rre d or opened in "Ansbacher" for me. Right? But I mean.. . (INTERJECTION). You say in your statement here at paragraph three? Right. "It appears from my statements from Ansbacher (Cayman) Limited that I may have had the b e n e f i t of a "back to back" f a c i l i t y . " 20 21 22 23 Do you have statements from "Ansbacher" Cayman 24 Limited now? 25 A. a loan. 26 27 Well, back to back f a c i l i t y , that implies that I had 86 Q. No, no. I am not i n t e r e s t e d ju s t for the moment in 28 the back to back f a c i l i t y . 29 statements. It i s simply your You say here you have statements from 1 "Ansbacher" Cayman. 2 possession? 3 MR. BOHAN: Will you j u s t give me a 4 few seconds, I may have 5 the them here? 6 the o f f i c e . 7 87 Q I am not sure I brought them from These came l a t e . MS. MACKEY: 8 Mr. O'Kelly, where did you obtain these statements 10 from? A 12 I am sure I obtained the statements from Padraig Collery I would think a f t e r Des died. 13 88 Q 14 A 15 89 Q 1994? 16 A 1994 . 17 90 Q 18 A 19 91 Q 20 A 21 22 While your s o l i c i t o r i s looking for those 9 11 Do you have them in your Right? Des Traynor died i n . . . ( INTERJECTION). Yes ? And i t was May. Yes? And I presume Padraig gave them to in a f t e r that date. 92 Q Right. (Same handed) (Exhibit 4). 23 these statements begin in 1992. 24 e a r l i e r statements? 25 A 26 93 Q 27 A 28 94 Q 29 Mr. O'Kelly Do you have any Do I have any e a r l i e r statements. Yes? No, I don't have any e a r l i e r statements. Do you have any other documentation provided to you by Mr. Collery in r e l a t i o n to t h i s account? 1 2 95 Q. 3 A. 4 96 Q. 5 Yes? No, I don't, no. Do you have any documentation which Mr. Traynor provided to you? 6 A. 7 97 Q. No, I don't. During the time that you had t h i s account 8 Mr. O'Kelly did Mr. Traynor - - did you rec e iv e any 9 statements from Guinness & Mahon about i t ? 10 A. 11 98 Q. 12 A. 13 99 Q. 14 A. 15 100 Q. 16 A. 17 101 Q. About my current account? Yes? No. The account that you are t a lk in g about here? No. That you opened? No. This, you say, as you understood i t at the time, was 18 an account in Guinness & Mahon. 19 normally have rece ived a statement? 20 A. 21 From my knowledge. From my bank, yes, I am sure I would. 22 102 Q. Yes? 23 A. Yes. 24 103 Q. 25 26 Would you not How did you know at any given moment what s t a t e your account was in? A. I j u s t always knew i t was in the black. I mean I 27 know t h i s seems extraordinary to you, and I know I 28 am a chartered accountant, and I know I am supposed 29 to be conscious of looking a f t e r money b e t t e r , but I 1 di d n 't r e a l l y need i t at the time. 2 which I earned while I was in G & M, and then the - ­ 3 when I s et up in p ri vate p r a c ti c e as a non-executive 4 Director the income fe e s e t c . were more than 5 adequate, you know. 6 104 Q. Like the sa lary Just g e t t i n g back again to your statement, you say 7 at paragraph f i v e , i f you would j u s t look at i t 8 again Mr. O'Kelly, you s t a r t o f f that paragraph by 9 saying: 10 "All savings I had and proceeds of s a le of shares including (Atlantic Resources) were given to Mr. Traynor in Guinness & Mahon." 11 12 13 14 That on the face of i t appears to say that whatever 15 monies you were lodging you gave to Mr. Traynor, i s 16 that the way you went about i t ? 17 A. 18 I mean that was when I joined G & M in 1971. 19 105 Q. 20 A. 21 106 Q. 22 A. 23 You gave them to Mr. Traynor? Yes, the balance that I had at that p a r ti c u l a r time. I see? Which came from the s a le of Commercial Investment Advisers understand. 24 A. 25 107 Q. 26 A. 27 108 Q. 28 A. 29 Had already given him. Plus the s a l e of my i n t e r e s t in Hong Kong. Yes? So, I had a c er ta in amount of money. Did you give them to Mr. Traynor personally? Well, sure I gave him - - I gave Des a cheque. Well, he would have given me a cheque I suppose for my 7 0% 1 2 109 Q 3 correct ? 4 A 5 110 Q 6 A 7 8 111 Q What was he doing with that as you understood i t ? Well, I presume i t was on deposit in G & M. A 11 112 Q 12 A 13 Mr. O'Kelly, you say you presume i t . However, what W e l l . . . (INTERJECTION). That you were giv in g him the money for? Again, I presumed. I presumed. I mean that i s what I did presume. 113 Q 15 When you handed him the money what did you ask him to do? A 17 Well, I presumed i t was ju s t on depo sit in G & M or on an account in G & M. 18 114 Q 19 A 20 115 Q 21 A I mean.. . (INTERJECTION). What did you ask him to do Mr. O'Kelly? I di d n 't ask him to do anything. You j u s t gave him money? And he would have given me some money, wouldn't he, 22 because I sold CIA to G & M? 23 given me some money. 24 gave to him. 25 Ireland in Terenure. 26 I did you understand at that time? 10 16 Yes . mean.. . (INTERJECTION). 9 14 However, what you had you gave to him, i s that 116 Q 27 So, he would have I would have had money which I I had an account with the Bank Of You gave him a l l your savings, i t says here, you say? 28 A Yes . 29 117 Q Yes? 1 2 118 Q 3 A 4 119 Q 5 A 6 120 Q 7 A 8 Which w e r e . . . (INTERJECTION). What did you ask him to do with those savings? I di d n 't ask him to do anything. What did he t e l l you he was doing with them? I don't think he ever t o l d me what he was doing with them. 9 121 Q 10 A 11 122 Q 12 A 13 14 Yes ? I mean I nev e r . . . ( INTERJECTION). Did you think he was keeping them? I am not s u g g e s t i n g . . . (INTERJECTION). For himself personally? No, no. I thought they were in the bank in an account in G & M. 123 Q That i s what I assumed. Can you remember the conversation you had with 15 Mr. Traynor when you handed him over a l l your 16 savings ? 17 A 18 124 Q 19 A 20 125 Q No, I c e r t a i n l y c a n 't . You cannot? No. You al s o say in paragraph 5: 21 "I had c er ta in moneys at that t i m e . . . " 22 23 24 25 You have explained what they are, " .. .a n d t h i s together with subsequent r e c e i p t s were lodged with Guinness & Mahon through Mr. Traynor." 26 27 What do you mean by "Subsequent rece ipt s" 28 Mr. 0 ' Kelly? 29 Well, I would have obtained I presume - - l i k e I made 20 1 money on the shares mentioned above, the A t la n t ic 2 Resources shares. 3 126 Q 4 A 5 And I can 't remember what I made but i t w a s . . . (INTERJECTION). 6 127 Q 7 A 8 The amount we are not concerned with here? Yes, but i t was something l i k e £190,000 and I paid tax. 9 128 Q 10 A 11 After my i l l n e s s my son paid my income tax. Right? So, then they were the monies that I am r ef er ri ng to. 12 129 Q 13 A 14 15 Yes ? However, what are the subsequent r ec e ip ts ? They would have been the s ala ry from G & M, I presume. 130 Q 16 Your sa lary from Guinness & Mahon was going into t h i s account, i s that correct? 17 A 18 131 Q This current account, yes. When you say i t was going int o the current account, 19 what happened with your s ala ry cheques? 20 lodged d i r e c t l y ? 21 A 22 132 Q 23 A 24 25 To my current account? Or were they given to you? I am sure I had a current account with G&M. Of course I had. 133 Q 26 27 Were they Are we ta lk in g about two separate accounts here or one account? A Well, I am not quite sure but we are probably 28 ta l k i n g about two accounts. 29 account, one would be the balance. One would be my current I mean I am not 1 2 134 Q 3 One, you say, might have been your current account and the other might have been the balance? 4 A 5 135 Q I t could be. By the balance do you mean the balance of the s a le 6 that was due to you from Commercial Investment 7 Advisers ? 8 A 9 Yes, plus another company that I owned c a l l e d Simpsons. 10 136 Q 11 A 12 137 Q 13 Yes ? Which I sold in 1982. You think that that might have been in a separate account from your current account? 14 A 15 138 Q 16 A Actually, you know, I don't know but I assume so. Why would you assume that? Well, I would be lodging every month a salary 17 cheque. 18 account by G & M. 19 139 Q It would have been tr ans fer re d to t h i s Was the s ala ry cheque that was lodged every 20 month lodged d i r e c t l y by Guinness & Mahon, i s 21 that corr ect , or was i t given to you? 22 A Well, i t wasn't given to me. So, I mean i t was 23 e it h e r tra nsf err ed. 24 current account in G & M or i t was tr a n s fe r to my 25 current account in Bank Of Ireland in Terenure. 26 140 Q 27 It was e it h e r lodged to that Did you get statements regarding your current account in Guinness & Mahon, regular statements? 28 A 29 141 Q No. You did not? 1 2 142 Q. 3 Guinness & Mahon did not provide you with any statements ? 4 A. 5 143 Q. 6 No. When Mr. Traynor died what did you do then in regard to your account? 7 A. 8 144 Q. 9 A. 10 When Mr. Traynor died? Yes? Well, I understood Padraig Collery tr ans fer re d the b a la n ce . 11 145 Q. 12 A. 13 146 Q. You did not make any enquiries about your account? 14 A. No, Padraig Collery - - I mean Padraig Collery must 15 147 Q. 17 A. 18 14 8 Q. 19 A. I am sure, yes. Why would Padraig Collery contact you about your I presume because he was - - he had r e s p o n s i b i l i t y for i t within the Bank. 149 Q. 23 Padraig Collery, I think, was not in the Bank in 1994, i s that not correct? 24 A. 25 150 Q. 26 I am not sure. I am not sure when he l e f t . As we understand i t Padraig Collery l e f t in 1989, l e f t Guinness & Mahon in 1989? 27 A. 28 151 Q. 29 Padraig Collery contacted you? Guinness & Mahon account? 21 22 I di d n 't do anything. have contacted me soon, quite soon, a f t e r that date. 16 20 Just not what you understood, but what did you do? 1989, yes. Mr. Traynor died in 1994? 1 I t i s quite c le a r that i f Mr. Collery contacted you 2 at that time you could not have thought i t was in 3 connection with Guinness & Mahon bu siness, i s that 4 not correct? 5 A 6 153 Q 7 8 Well, i t was. It was about my account. What would Mr. Collery, who was no longer working with Guinness & Mahon, have to do with your account? A 9 Well, he was obviously looking a f t e r i t . Des or N i a l l said he was looking a f t e r i t . 10 154 Q 11 A 12 155 Q 13 A Would you not find that very strange, Mr. O'Kelly? I do find i t strange, yes, when I look back. Did you not at the time? No, at the time. At the time that Des died I was 14 (A) upset with Des, and (B) I ju s t had the stroke 15 about a year and a h a lf at that stage and I don't 16 think I was perhaps handling things too c l e a r l y or 17 carefully. 18 156 Q Mr. O'Kelly, from these statements here, that you 19 have given us, i t i s c lea r that i n t e r e s t accrued on 20 your account from time to time. 21 the statement? 22 A 23 157 Q 24 A 25 158 Q R ig ht . You acknowledge that I am sure? Sure . I t i s here on the face of the statements (Exhibit 4) ? 26 27 A 28 159 Q 29 I t appears here on Yes . Did you declare that i n t e r e s t to The Revenue Commissioners? 1 2 160 Q. 3 A. 4 161 Q. 5 You do not know? No. You evidence to us i s that you do not know whether you did or not? 6 A. 7 162 Q. 8 A. 9 The evidence i s that I don't know. Right? Yes. I don't know whether i t i s s i g n i f i c a n t , whether the i n t e r e s t was s i g n i f i c a n t or not. 10 MR. BOHAN: 11 up with The Revenue 12 Commissioners. 13 MS. MACKEY: 14 Yes. However, i t i s a matter of fa c t for us. 15 16 We w i l l be cl ea r in g that 163 Q. MR. BOHAN: Yes . MS. MACKEY: You made c er ta in 17 withdrawals Mr. O'Kelly 18 from t h i s account? 19 A. 20 164 Q. 21 Yes . You r ef er to one here at paragraph 4 of your st atement: 22 "The i n i t i a l withdrawal of £55,000 I do not remember..."? 23 24 A. 25 165 Q. 26 27 28 29 Yes . " . . .and i t may have been arranged through Mr. Traynor while I requested any other withdrawals through Mr. Collery"? 1 166 Q The withdrawals that you requested through 2 Mr. Collery, did you request those before 3 Mr. Traynor's death or afterwards? 4 A They would have varied I think because my children 5 were g e t t i n g married. 6 have f i v e boys and one daughter and I gave the 7 boys some money on t h e i r marriage. 8 £30,000 ea ch . 9 167 Q 10 A 11 168 Q 12 A 13 14 I think I gave a load of - - I I think i t was Was that before Mr. Traynor's death, before 1994? Well, they got married on d i f f e r e n t dates. However, were some.. . (INTERJECTION)? You know we are going back to - - yes, we are going back to l i k e 1988 and 1990. 169 Q 15 What I am tr yin g to a s ce r ta in i s whether you made withdrawals prior to Mr. Traynor's death? 16 A Both. 17 170 Q Both? 18 A 19 171 Q Before and a f t e r . Those that you made before Mr. Traynor's death, did 20 you make them a l l through Mr. Collery except for 21 t h i s i n i t i a l withdrawal, or did you make some of 22 them through Mr. Traynor, or can you remember? 23 A I would say they are a l l through Padraig. Maybe the 24 f i r s t one might have been - - I might have said to 25 Des when Michael got married - - I might have said to 26 Des - - I can 't remember r e a l l y . 27 Could you t e l l me how - - what you did when you 28 required a withdrawal? 29 I j u s t d i a l l e d - - t o l d Padraig or Des that - - to 26 1 tr a n s fe r money to me, to Bank Of Ireland in 2 Terenure. 3 173 Q 4 A 5 174 Q 6 A 7 8 To the Bank Of Ireland in Terenure? Yes . Now.. . (INTERJECTION)? Maybe i t was (inaudible) bank and I tr ans ferre d i t to Terenure. 175 Q 9 Yes. Mr. O'Kelly, can I ask you to look at a document. 10 A 11 176 Q It i s page 19 (Exhibit 2) Thanks. Actually, perhaps, page 21 as w e ll . 12 Mary. 13 Mr. O'Kelly? 14 A 15 177 Q 16 (Same handed)? Page 19 for the moment. No, sorry, You see that l e t t e r Yes . Which i s headed, the heading i s s l i g h t l y blocked out there in the photocopy: 17 "Hamilton Ross Co. Limited, PO Box 887, Grand Cayman, Cayman Islands"? 18 19 A 20 178 Q Yes . I am sorry. The one I am r e f e r r i n g to you, the one 21 I am asking you to look at, does not have that 22 heading on i t in the photocopy. 23 see at the bottom i t i s signed: 24 However, you can "For HAMILTON ROSS CO. LIMITED." 25 26 27 Do you see that? A Yes . 28 I t i s addressed to Ronan Redmond of I r i s h 29 In te r co n ti n e n t al Bank Limited? 1 2 3 October 1993, i t says: 4 "Dear Ronan, Could you ple as e arrange to l e t us have for c o l l e c t i o n a S t e r l i n g cheque for S t g . £38,085.88 payable to THE MIDLAND BANK and debit the cost to Hamilton Ross Account..."? 5 6 7 8 A 9 181 Q Yes . At the bottom there i s a reference: 10 "DPC. . . " 11 12 Which we understand to be Dermot Patrick Collery, 13 " . . . P l e a s e debit A/A55." 14 And then in handwriting: 15 16 "Cheque posted to MEOK at home..." 17 18 A 19 182 Q Yes . " . . . 13/10/93" 20 21 A 22 183 Q 23 A Right, yes. Is that a withdrawal that you r e c o l l e c t receiving? Well, I don't r e c o l l e c t r e c e iv in g i t but I mean 24 obviously - - i t i s obviously r e l a t e d to one of the 25 boys g e t t i n g married. 26 184 Q 27 A 28 185 Q 29 Right? And my g i f t to him. To him. page 25. Can I pass you another document and t h i s i s (Exhibit 3) (Same Handed)? 1 2 186 Q This i s a l e t t e r of the 2nd September 1994. Again, 3 i t i s signed on behalf of Hamilton Ross Co. Limited 4 and addressed again to I r i s h I n te r co n tin e nt al Bank? 5 A 6 187 Q 7 Yes . With again the reference: "DPC - A/A55" 8 9 at the bottom? 10 A 11 188 Q Yes . This l e t t e r asks for S t g . £16,000 to be transfe rre d 12 to The Midland Bank, Poultry and Princess St re e t, 13 London? 14 A 15 189 Q 16 A 17 190 Q 18 19 Yes . For c r e d it to the account of M. E. O'Kelly? Yes . Was that your account in The Midland Bank Mr. O'Kelly? A I am sure i t i s , yes. You see The Midland Bank 20 i s the - - The Hong Kong & Shanghai Bank took over 21 The Midland Bank. 22 191 Q 23 24 Shanghai Bank? A 25 26 You had an account there, with The Hong Kong & My account was with The Hong Kong & Shanghai Bank and then they took over The Midland Bank. 192 Q 27 Is that another withdrawal that you would have made at that time? 28 A 29 193 Q I am sure i t i s , yes. Yes? 1 2 194 Q 3 A 4 Yes ? 1992/1993 to 1995, that I did r es ig n . I did give up seve ra l of my d ir e c t o r s h ip s . 5 195 Q 6 A 7 196 Q 8 A 9 Yes ? Because of my health at that p a r ti c u l a r time. Yes? So, two things happened over that p a r ti c u l a r period, 1993 to 1998. 10 The two s i g n i f i c a n t th ing s, from my personal point of view, were f i r s t my stroke. 11 197 Q 12 A 13 Yes ? And I resigned two or three of my d ir e c t o r s h ip s as a r e s u l t of i t . 14 198 Q 15 A Yes? And in addition a firm of which I am Chairman in 16 Waterford, Waterford Stanley Limited, the Financial 17 Director l o s t something l i k e £4. 3 m i l l i o n in foreign 18 exchange specu lat ion at that time and there was no 19 dividends in Waterford Stanley for a period of three 20 years. 21 199 Q 22 A 23 200 Q 24 A 25 26 I think i t i s from 1997 on. Mr. O'Kelly, i f I - - not to interrupt you there? Not at a l l . Not to interrupt you there but...(INTERJECTION)? I am ju s t tr yin g to t e l l you, explain, why I needed such large amounts that i s a l l . 201 Q 27 Yes. We are not r e a l l y concerned with the reasons why you needed them? 28 A 29 202 Q Fine . 1 2 203 Q 3 A 4 204 Q Sure . I t appears that in 1993 your account was transfe rre d 5 from "Ansbacher" to Hamilton Ross & Co. Limited. 6 Are you aware of that? 7 A 8 205 Q 9 A No, I wouldn't have been aware of that at the time. You were not aware of that? I mean - - sorry, I mean I understand how 10 Hamilton Ross came into the pi ctur e but I wasn't 11 t o l d i t was being transfe rre d there or anything 12 r e l a t i n g to i t . 13 206 Q Yes. Were you aware Mr. O'Kelly that your account 14 was one of the coded accounts in Guinness & Mahon, 15 coded A/A55? 16 A Well, I am sure I was aware of i t but I mean I 17 wouldn't have attached any p a r ti c u l a r s i g n i f i c a n c e 18 to th at . 19 207 Q 20 A 21 Like I mean I ju s t thought that was an account number. 22 208 Q 23 A 24 25 Yes? You thought A/A55 was an account number? Yes, I mean i t wouldn't have r e g i s t e r e d with me as being p e c ul ia r in any way. 209 Q When would you have become aware that was. . . (INTERJECTION)? 26 27 A 28 210 Q 29 A I di d n 't become aware u n t i l . . . (INTERJECTION). An account number? 1 211 Q No, no. When were you - - when did the number A/A55 2 become known to you? 3 i t at the time? 4 A Were you aware - - did you know I don't think i t ever became known to me in s o fa r as 5 I never made a note of i t or anything but I did 6 become aware of the fa c t that - - subsequently I 7 heard, i t must have been from Padraig Collery or 8 somebody, that I was in an account holder, there was 9 other people in the same account or something. 10 212 Q 11 You became aware that you were in an account with others ? 12 A There was other people in the same account. 13 213 Q That other people were in the same account? 14 A 15 214 Q 16 A 17 I gather. Did Mr. Collery t e l l you that? I think i t was. It couldn't have been anybody e l s e I don't think. 18 215 Q 19 A When would that have been? I don't know. It must have been around about a f t e r 20 Des died. 21 when I became aware of the fa c t that there was 22 some account, e i t h e r in G & M or in Cayman, where 23 CJ Haughey and myself and somebody e l s e were in the 24 same account. 25 You were aware at that stage that i t may have been 26 in Cayman? 27 No, I wasn't aware i t was in Cayman. 28 aware I was in the same account at CJ and somebody 29 e l s e in 1996 or 1997. It must have been around about 1995/1996 I was ju st 1 217 Q 2 3 What did you ask Mr. Collery about that when he t o l d you? A 4 5 Right. I di d n 't ask him anything about i t . There was nothing to be asked about i t . 218 Q Did i t not seem strange that you thought your money 6 was in a current account in Guinness & Mahon and now 7 i t appeared that i t was in a j o i n t account with 8 other persons? 9 A 10 It wasn't a j o i n t account. It was j u s t that I was in the same account. 11 219 Q 12 A 13 14 Not a j o i n t account. However, can you explain that to me a l i t t l e bi t ? I can't explain i t to you and i f you can explain i t to me that would be f i n e . 220 Q 15 However, you must surely have questioned Mr. Collery about that? 16 A 17 221 Q 18 A Well, I asked him how did i t a r i s e . Yes ? And he said i t was for convenience, something to do with the tr a n s f e r s or something. 19 20 222 Q 21 A That i t was something to do with the tr a ns fer s? Yes, l i k e I can't remember in what words he 22 explained i t to me but he had an explanation for i t 23 at the time, i t was convenient for something or 24 other. 25 223 Q 26 A 27 224 Q You cannot remember that now, i s that right? I don't know what the explanation was. I f I could summarise Mr. O'Kelly, i s i t the case 28 that you gave money to Mr. Traynor. 29 understand i t , i s a summary of your evidence here This, as I 1 today: 2 1971 onwards; you were not aware of what he did with 3 i t ; you did not ask him to do any p a r ti c u l a r thing; 4 i t now appears that that money was on deposit with 5 the company known as "Ansbacher" Cayman Limited; the 6 money earned i n t e r e s t over the years; you do not 7 remember whether you declared that money, the 8 i n t e r e s t , to The Revenue or not; you made c er ta in 9 withdrawals by contacting e i t h e r Mr. Traynor or You gave money to Mr. Traynor from about 10 Mr. Collery, including Mr. Collery at a time a f t e r 11 he had l e f t Guinness & Mahon. 12 correct summary of your evidence today? 13 A. Would that be a Well, with regard to i t that i t seems very 14 extraordinary for a chartered accountant to behave 15 in t h i s fashion then I would b e l i e v e - - I would 16 agree that i t i s a correct summary of the events. 17 225 Q. Very good. I have no further questions Mr. O'Kelly. 18 END OF EXAMINATION OF MR. MAURICE O'KELLY BY 19 MS. MACKEY 20 21 22 23 24 25 26 27 28 29 1 2 3 4 226 Q. MR. JUSTICE COSTELLO: Just in r e l a t i o n to the 5 payment of tax 6 Mr. O'Keiiy, did you look a f t e r your own tax a f f a i r s 7 or had you an accountant? 8 A. 9 227 Q. 10 A. No, they were always looked a f t e r by an accountant. Who was that? What was h is name? Well, wait u n t i l I see. There was two. There was 11 the auditors to Simpsons, which was a firm that I 12 bought in 1962. 13 Dury Stre et that I bought before I s t a r t e d CIA and I 14 sold i t in 1982. 15 228 Q. 16 A. 17 229 Q. 18 A. Can you remember the name of the firm? I am ju s t tr yin g to think. It w a s . . . (INTERJECTION). What was t h e i r . . . ( INTERJECTION)? Dodd. Christopher Dodd, Chris Dodd was t h e . . . (INTERJECTION). 19 20 230 Q. 21 A. 22 231 Q. 23 A. 24 232 Q. 25 A. 26 233 Q. 27 A. 28 29 It i s a pr in t in g firm in Chris Dodd? Yes. Who e l s e did you have then? But i t was Dodd something. Yes? G-r-e-h-a-n Dodd. He had died. Yes? Grehan Dodd & Company. Street. 234 Q. Grehan Dodd, sorry. Yes? They were in O'Connell 1 And they were the auditors to Simpsons. 2 was my connection with them. 3 235 Q 4 A So, that They were you own personal accountants? They - - yes, they looked a f t e r my personal tax, yes, 5 u n t i l I l e f t G & M in 1985 and I had my o f f i c e s . 6 do s t i l l have my o f f i c e s lo ca ted in Baggot St re e t, 7 and in the bu ild in g of a friend of mine c a l l e d 8 Brendan Sherry, who operates as a chartered 9 accountant. I He has a chartered accountancy firm and 10 I tra nsferre d my tax in that year to be looked a f t e r 11 by the tax a ti on expert in Sherry O'Connor. 12 ju s t tr yin g to think of h is name for a second. 13 236 Q 14 A Yes? Any way that i s the name of the firm that looked after i t . 15 16 I am 237 Q 17 Either then Grehan Dodd or Brendan Sherry's records would show.. . (INTERJECTION)? 18 A 19 238 Q 20 A 21 239 Q Yes, they complete my annual tax returns every time. They made your returns? Yes . They could e s t a b l i s h whether or not there was 22 included in your returns any i n t e r e s t you have 23 earned? 24 A 25 240 Q 26 A That i s corr ect . Have you made enquiries? I haven't made e n qu ir ie s . I don't think i t i s 27 mat eri al. 28 mean - - when I say that I mean i t may appear very 29 casual or very c a r e l e s s but I don't think the I don't think i t i s very large now. I 1 2 241 Q There as a f a i r l y s u b s t a n t ia l sum of money to 3 the c re d it of t h i s account, "Ansbacher" account, 4 in 1992, i s there not? 5 A 6 Yes, I am sure there i s . Is there? I ca n't remember. 7 242 Q 8 A 9 243 Q 10 A 11 244 Q 12 A 13 245 Q There is? Yes . A s u b s t a n t ia l sum? Yes . And i n t e r e s t would be s u b s t a n t i a l on that per annum? The i n t e r e s t would be s u b s t a n t i a l , would i t ? What I am asking i s , as I understand i t , you do not 14 know whether or not you returned those for income 15 tax? 16 A 17 246 Q 18 A 19 247 Q That i s corr ect . Have you made enquiries from your accountants? No. Yes. Very w e l l . 20 END OF EXAMINATION OF MR. MAURICE O'KELLY BY 21 MR. JUSTICE COSTELLO 22 23 24 25 26 27 28 29 1 2 MS. MACKEY 3 4 248 Q MS. MACKEY: Just one other matter 5 Mr. O'Kelly? 6 A 7 249 Q Yes . We required you in our l e t t e r to you to produce to 8 us a l l documents in your p os s e s s i o n . 9 j u s t today you produce to us the statements from 10 "Ansbacher". 11 p os s es si on whatsoever? 12 13 A I am sorry. Now, in fa c t , Have you any other documents in you I thought you had them. MR. BOHAN: 14 Yes, we did get some other documents. There i s 15 roughly the same as you have and now, that was my 16 f a u l t and I ap olo gis e . 17 MS. MACKEY: 18 19 We require everything you po ssess p le a s e . MR. BOHAN: 20 I w i l l get i t down to you. I apo logise for th at. 21 MS. MACKEY: Yes. 22 MR. JUSTICE COSTELLO: We require every document 23 Thank you very much. that Mr. O'Kelly has given 24 to you. 25 MR. BOHAN: Yes. I w i l l make sure you 26 get i t today. 27 Yes . 28 Have you written 29 Mr. O'Kelly to "Ansbacher" 1 Cayman in connection with your account and asked 2 them for documents? 3 No. 4 251 Q 5 A 6 252 Q Would you do that please? Write to "Ansbacher" in Cayman? To "Ansbacher" Cayman and to Hamilton Ross and ask 7 them for any documents that they may have in 8 r e l a t i o n to your account, A/A55? 9 MR. BOHAN: Sorry, we w i l l do tha t. 10 MS. MACKEY: Thank you. 11 MR. BOHAN: Yes. 12 END OF EXAMINATION OF MR. MAURICE O'KELLY BY 13 MS. MACKEY 14 15 MR. JUSTICE COSTELLO: Thank you Mr. O'Kelly. 16 This evidence given today 17 with be transcribed and we would ask you to come in 18 to sign the t r a n s c r ip t of the evidence? 19 A 20 Sure . MR. JUSTICE COSTELLO: I f you would l i k e to stay 21 on now and have a cup of 22 c o f f e e you can, you might prefe r to leave however. 23 MR. BOHAN: 24 A Thank you very much. Thank you. 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED anti So vi u?xln!? \Sxxk him Wm wkes- 1000 Statement of Maurice O’Kelly for the Inspectors appointed by Order of tbe High Court to Ansbacher Cayman Limited. A. I suffered a serious stroke on 18 November 1992. My memory suffered significantly and is still unpaired. I was treated in St James Hospital and by Dr. Karl Cannon. I enclose a copy of a letter of confirmation from Dr. Cannon. B. The following are the specific answers to the questions raised in the letter dated 21 December 1999 addressed to me:1. I have no knowledge whatsoever of the operation of Cayman Island Trusts or Trust Companies. I never executed a deed of trust or other instrument in the Cayman Island or elsewhere whereby the Company or any person associated with it was a trustee or managed the trust. _ 2. I never caused a body corporate to be established in the Cayman Islands to which money or other assets was or were assigned and which were managed by the Company or by some other person associated with it or acting at its discretion. 3. It appears from my statements from Ansbacher (Cayman) limited Oat I may have had the benefit of a "back to back” facility although I did not know of this. I was seriously ill around the time this happened and I had lost almost all sources of income. I withdrew moneys by requesting Mr. Collery to deal with the matter. There were a number of significant withdrawals but these were mainly for living expenses (in the absence of a definite income) and for wedding gifts to children. Following the death of the husband of my former secretary Carmel Byrne (then Smyth), I contributed £1,000 p.m. for her maintenance etc. until die remarried. This is to be repaid to me. I have a substantial loan (£140,000) with Ulster Bank which is a personal loan and is not secured by any “back to back” facility. 4. I was not aware or do not rememberthe use of "back to back” financing. The initial withdrawal of £55,000 I do not remember and may have been arranged through Mr. Traynor while I requested any other withdrawals through Mr. Collery. The dates of any such withdrawals are evident from the statements. 5. All savings I had and proceeds of sale of shares including (Atlantic Resources) were given to Mr. Traynor in Guinness & Mahon. I had joined Guinness &Mahon in 1971. I had certain moneys at that time and this together with subsequent receipts were lodged with Guinness & Mahon through Mr. Traynor. All lodgements and withdrawals were personal. The bank account numbers and codes are ascertainable from the statements. Ansbacher Limited Account no. 80001643 AJA5 I never availed of or had any dealings with Kreditbank N.V. I did not apply for Exchange Control consent As far as I was concerned the only money I had outside the country was with HKSC Bank, an account I have had since I was in Hong Kong prior to my return to Ireland in 1961. I never considered whether or not I was breaking Exchange Control regulations. I never had any Healing with Channel Island companies. Honan Redmond, Esq., Corporate Services, Irish Intercontinental 91 Merrion. Square, DUBLIN 2. ^ . B a n k L im t t a a , • ) Ronan, . Could you please arrange to let us have^for^oolleati^tt^a^ Sterling cheque for S t g . E 3 8 , O 8 5 . 8 0 /oi35d/fl1 and debit tha coot to Hamilton Ross Acmamt No. 02/0135 4/81. D aax Toura sincerely, /-v ' For HAMILTON ROBS CO. LIMIT»P ' ’N V) JDT/AJW DPC - Please debit A/A55 p & tZ a t & M ffO 'K eutr n iH < ?2> Ms. Dsire Nblan-Cassidy, Corporate Services, Irish btercontnwntBl Bank Limited, 91 Morion Square, DUBLIN 2. ^DearDairat 2nd September, 1994. . . Could you please arrange to transferStg.£16,000,00 to: Midland Bank P.O. Box 648 Poultry and PrincessStreet London EC2P2BX Sort Code: 40-03-30T for credit to Account of. ^ M. OTCeUy Account Na41474553 r* /’■ ‘n «4easedebitdiecosttoHamiltonRosaAccountNa02/01354/Sl. <.; ) ■ Yours sincerefy, ' For HAMILTON ROSS CO LIMITED PRC/AJW P.O.Box887 3rsndCayman BrftlahWwlIndia* TdaphanaNo. 9—MS3M Tala*CP308 CabtaAddraasOulnnaa* tfnachar Limited CayMO J m9/ 10/93 m 3/10/93 3/10/93 5/10/92 3/10/93 3/10/93 3/10/93 3/10/93 laM r"-"*" TOUMY UMN INTON33QK. LODGED >1/10/93 N OOlM3 mm WWIOM HtfM ACCOUNTNUMaM MUMCMtHMMAMNk " • '‘“ I 930000.00 1306.85 A/AW t 330000.00 3066.94 33780.09 CHHWaWMWAW A N S B A C H E R LIM 'ED P.O.Box587 GrandCayman BfW ill Wait TataphonaKu. a-ffHM TaiaxCPSOSCabtoAddrataOuinnasa f ib i cht r Lialtad Ciyno J L. 10/11/93 ■MUOmMMNMO 11/13/43 31/13/93 Intaraat to 31/13/93 11/13/93 CAHMCDFOmMAK> ACCOUNTMUam (0001643 auANCMWOWNAMItt; atarlU* 413.03 ....................... A/A55 3 337M.09 34173.14 ............... J A N S B A C H E R LIM ED P.O. Box M T Orand CaymM Britiah W ot IndtM (fSlLTON SOSS ""I L. J M/01/93 M/01/93 31/13/93 tnuapp TalaptaneNa *—4*63*4 TMwCPSOS CabtaAddruiQuIm im * ACCOUNTNUMMM B0001M3 Ml tMMNHMMWN/MSIM *t»rll»* 3U73.U A/ASS 1 0.00 • >1/01/93 V CMMBNMMO 24173.U > A N S B A C H E R LIM: ED P.O. Box M7 Orand Cayman Britlaii W M TalaphonaNc>a—4*53/4 TalaxCP306 CaMaAddraaaOtilnnaaa L. J 1/03/93 31/03/93 Intaraat to 31/03/93 >1/03/93 •00018*3 mm aAuutcatmown a m i* 393.33 atarllog 2«T3.1« 2U26.47 P.O. BoxB«T GrandCayman Mtttli Wwllndlu TalaphomNa8—4WH Tala*CP906 CabtoAddnmMnoMa J L. 17/05/93 17/05/93 iHs«ftTrw«/93 21/09/93 17/05/93 VMM 31/03/93 V____ CAMUDfOWXAHP, A/A55 3 (0001643 mo( •alamos(MM*ami* «**rlU* 34700.34 173.67 34700.34 0.00 ____✓ ANSBACHER LIM' ED □ P.O.Box887 GrandCayman MtlahWaal Indtaa TalaphOMhe. 9-4103/4 TalaxCP308 CaMaAddraaaQuinnaaa jmiLTON mss L 9/06/93 09/06/93 J A/AH ACCOUNTMUMR *00016*3 MU * MLMKn«MMMAMM! atarUof 197019.33 /■"V 10/06/93 V____ 197019.33 a .IONBOSS P.O. Box M7 Orand Cayman British W «t India T«taphon*Na.8-4aaaM TdmCP300 CaMaAiMrmiGulnnau A/AS3 A N S B A C H E R LIM’ED P.O.Box887 OrandCaynuui MttihWMtIndtes TataxCP3t6 C«bl*AddraHOulmwn A/A55 J 30/ 9/93 7/10/93 31/10/93 7 /10/93 31/10/93 ACCOUNT MUUMR #0001643 MW 6 3«,oas.sa t o 31/10/93 3 ,2 3 9 .3 5 1 5 3 ,2 3 ».3 S tT^ A p p e n d i x X V ( 1 0 0 ) O ’R e illy A e r lo d ( I r e la n d ) L i m i t e d 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to O’Reilly Aerlod (Ireland) Limited. a) Transcript o f evidence o f Mr Diarmuid Carpendale dated 8 November 2001. b) Companies registration details in respect o f O’Reilly Aerlod (Ireland) Limited. c) Letter o f 22 January 1991 - Ansbacher Limited to IIB. d) Cheque dated 18 January 1991 in favour o f O’Reilly Aerlod Limited. UNDER OATH ON THURSDAY, 8TH NOVEMBER 2001 I hereby c e r t i f y the fo llowing to be a true and accurate t r a n s c r ip t of my shorthand notes in the above named int erview. Stenographer The Inspectors: HIS HONOUR JUDGE SEAN O'LEARY MS. MACKEY BL Administrator to the Inspectors: MR. T. SLEVIN Inte r v iew e e : MR. DIARMUID CARPENDALE WITNESS MR. D. CARPENDALE I EXAMINATION JUDGE MS. MACKEY PAGE 19 - 18 21 1 2 8TH NOVEMBER 2 001: 3 4 5 JUDGE O'LEARY: Good morning. 6 MR. CARPENDALE: Good morning. This is 7 the last place in the 8 world I ever expected to be but that is besides 9 the po i n t . 10 JUDGE O'LEARY: 11 Yes. Mr. Carpendale, my name is Sean O'Leary. 12 I am one of the four Inspectors. 13 on my right, 14 The other two Inspectors are not dealing with this 15 particular matter. 16 at our meeting this morning. Ms. Noreen Mackey, is the second of the four Inspectors. So, it is just the two of us 17 18 It is a very informal procedure except under the 19 legislation the evidence has to be given on oath. 20 MR. CARPENDALE: No problem. 21 JUDGE O'LEARY: So, 22 23 24 25 26 27 28 29 I would ask Mr. Slevin to administer the oath on our behalf. 1 2 3 4 5 1 Q. JUDGE O'LEARY: Mr. Carpendale, the 6 position is that we 7 are investigating the affairs of "Ansbacher", 8 which is a company that was previously called 9 Guinness Mahon Cayman Trust and had a few other 10 similar names as well. 11 12 One of the jobs which we have been asked to do 13 by the High Court is to find out who the customers, 14 the Irish customers, of "Ansbacher" were. 15 16 The purpose of discussing this matter with you here 17 today is to try to solve a mystery that has being 18 puzzling us for some time. 19 20 Before I ask you about the specific thing, 21 letter which you already have, 22 you already have could I just find out from you 23 some details? 24 involved in the air transport business, 25 not correct? 26 A. 27 2 Q. 28 A. 29 3 Q. the and the information You were, Mr. Carpendale, I think is that That is correct. And you were with Mr. O'Reilly, is that correct? I was with Jackie O'Reilly for ten years. Yes? 1 2 4 Q 3 And the business was sold, Mr. Carpendale, that correct? 4 A 5 5 Q 6 A 7 6 Q 8 A 9 7 Q 10 A 11 8 Q 12 A 13 9 Q 14 Mr. O'Reilly sold the business; yes, he did. Yes ? In I think -- I can't remember the exact year. About 198 ... (INTERJECTION)? 1986 I think it was. W e l l . . . (INTERJECTION)? O r ...(INTERJECTION). It would be before that I would say really? 19 . . . (INTERJECTION). However, he sold it some years before he died any way, did he? 15 A 16 10 Q Yes. 17 A Yes, 18 11 Q Yes. 19 A Yes . 20 12 Q 21 A 22 23 is He sold it about five years before he died. Yes. Did you go with the new organisation? I arranged the sale actually. Did you? To Mainport Holdings in Cork? To Irish Mainport Holdings who were at that stage owned by Clyde Shipping in Scotland. 13 Q Yes. Irish Mainport Holdings purchased I think 24 the business rather then the company, 25 correct? 26 A 27 14 Q 28 A 29 15 Q is that not They purchased the goodwill and trading operation. Yes. They did not purchase the business? Absolutely not. 1 2 16 Q. 3 A. 4 17 Q. 5 A. 6 18 Q. 7 The Company subsequently went into liquidation? Yes, exactly. And was wound up in the normal way? Exactly. All right. You worked then for the new company which was called...(INTERJECTION)? 8 A. 9 19 Q. 10 A. 11 20 Q. 12 O'Reilly Aerload Ireland Limited. Yes, with the Ireland being the additional portion? Exactly. Yes. You worked in a capacity for them under the Mainport Holdings' banner if you like? 13 A. 14 21 Q. 15 Exactly. And then Mainport Holdings sold it back to the Management, 16 A. 17 22 Q. 18 A. 19 23 Q. 20 A. is that correct? They sold it back to the Management, yes. Including yourself? Including myself. At what stage did that happen? 1989 I think it was. I could be wrong in that. 21 I am not too good on my dates these days but 22 I always -- it was after a long period of 23 negotiations. 24 24 Q. 25 A. 26 25 Q. 27 A. 28 26 Q. 29 I see. About 1989? 1989. In fact I think to put the m a t t e r ...(INTERJECTION)? It was August 1989 I think. Yes. O'Reilly Aerload Ireland Limited was 1 2 27 Q. 3 So, that would seem to suggest that you were right in your 1985 date? 4 A. 5 28 Q. That is what I thought, Yes. You think about 1989 then it w a s ...(INTERJECTION)? 6 7 A. 8 29 Q. 9 A. 10 30 Q. 11 A. 12 31 Q. 13 A. Yes. 14 32 Q. Yes? 15 A. 16 In 1989 there was a -- we did a Management buy-out. Yes. Who was involved in that? You had Des Turvey, Sorry. Des Turvey? Des Turvey who was the Secretary and Financial Director. 33 Q. 18 A. 19 34 Q. Gerry? 20 A. Cohen, 21 35 Q. 22 A. 23 36 Q. 24 A. 25 37 Q. Yes. 26 38 Q. MS. MACKEY: 27 A. 29 Gerry Cohen. Just one second now? 17 28 yes. Yes? You had Gerry Cohen. C-o-h-e-n. Yes? You had Tony Kiernan. Yes? You had Dan Cullinane. Cullinane, Cullinane? yes. JUDGE O'LEARY: Yes. 1 39 Q. 2 A. 3 40 Q. 4 A. Yes, and yourself? And myself. Okay. No, Were you equal partners? I owned 37% of the shareholding. The rest 5 were broken down in various tens and fourteens. 6 I couldn't give you the exact...(INTERJECTION). 7 41 Q. 8 A. 9 42 Q. 10 11 However, you were if you like the biggest? I was the major shareholder at 37%. At 37%. You were the man that was actually operating the business? A. 12 13 I know. I was the man who was the Managing Director of the business, 43 Q. Yes, yes. yes. I think Mrs. O'Reilly has given us 14 evidence on the basis of information which she 15 had that one of the difficulties that arose was 16 that in the original transfer of business money 17 was still coming in for the benefit of O'Reilly 18 Aerload Limited? 19 A. 20 44 Q. 21 Which was processed by you and lodged to their account, 22 A. 23 45 Q. 24 A. 25 46 Q. 26 is that correct? That is correct and then we did a settlement. And did a settlement. I understand? We did a settlement after about three months. All right. That is grand. So, that was one of the on-going things? 27 A. 28 47 Q. 29 That is correct. Yes. In that settlement did O'Reilly Aerload Ireland Limited, after the three months, acquire all 1 2 A. 3 48 Q. Absolutely. Yes. So, I could safely say that from the 4 beginning of 1990 onwards all O'Reilly Aerload 5 Limited debtors were now belonging to O'Reilly 6 Aerload Ireland Limited? 7 A. Yes, 8 49 Q. Yes? 9 A. 10 except for one thing. In that period Mr. Jackie O'Reilly still held on to some refunds that were coming from airlines. 11 50 Q. 12 A. 13 51 Q. 14 A. 15 52 Q. 16 Yes. Mr. O'Reilly held on to refunds from airlines? From airlines. All right, okay? For about a three month period. All right, okay. You have seen the document which we sent to you? 17 A. 18 53 Q. 19 A. 20 54 Q. 21 Yes, I have. And this relates to 1991? Yes. And attached to it there is a -- this is page 6 and 7, Mr. Slevin. 22 A. 23 55 Q. 24 No, Have you copies of that? I haven't but I have seen them all. You might give them to Mr. Carpentdale (Same Handed), Exhibit 1? 25 A. 26 56 Q. 27 Thank you. Yes? Were you the Managing Director of O'Reilly Aerload ...(INTERJECTION)? 28 A. 29 57 Q. Ireland Limited. Ireland Limited at that stage? 1 2 58 Q 3 A 4 This was a matter that was handled by our Financial Director Des Turvey. 5 59 Q 6 A 7 Yes ? It was an arrangement that he had that bonuses were paid to the Directors in this method. 8 60 Q 9 A 10 What method was that? The method that we were dealing with a company called Boardman Air Services in London. 11 61 Q 12 A 13 62 Q 14 A Yes ? And they paid us on about six times a year. Yes? And Christmas bonuses and things like that were 15 handled by this method of receiving this cheque 16 (indicating) 17 an arrangement. 18 I think I mentioned it in my letter -- of 19 Business & Enterprise Services. 20 it was Clyde Road where they operated. 21 63 Q 22 A 23 24 I cannot remember the name. I think Yes? And he processed this for us and we obviously were avoiding tax at that stage. 64 Q 25 Yes, I understand that and really that is not a matter for me at all? 26 A 27 65 Q 28 29 and I think Mr. Turvey had set up Yes. But -- yes. So, you think the money was given by your Financial Director to a man who operated out of Clyde Road? A Yes, Jack Stapleton was the gentleman. 1 66 Q. 2 A. 3 67 Q. 4 Jack Stapleton? Yes. I am absolutely -- I know that happened. Well, now we have a name that is a slightly different name to that. 5 A. That is it. 6 68 Q. Is that it? 7 A. 8 69 Q. 9 A. 10 70 Q. 11 A. 12 71 Q. It is Jack Stakelum? Forgive m y . ..(INTERJECTION). Yes? Because I never met the person, right? Yes? Mr. Turvey handled all of these arrangements. However, you say in your letter that you recall 13 this cheque which he sent to Mr. Stapleton who 14 handles such matters for him, 15 16 "...and I think the name of the company was Business Enterprises in Clyde Road." 17 18 19 A. 20 72 Q. 21 A. 22 23 Yes? Opposite the -- as far as I know it is opposite the American Embassy. 73 Q. 24 So, what used to happen is that the money used to be given to Mr. Stapleton? 25 A. 26 7 4 Q. 27 A. 28 7 5 Q. 29 Yes, because I know it operated in Clyde Road. Exactly. Mr. Stakelum? Yes. And drawn down as required? 1 it used to be drawn down by Mr. Turvey as required 2 and distributed to the Directors. 3 76 Q. 4 A. 5 77 Q. 6 And distributed to the Directors? Yes. And which of the Directors would have got that money? 7 A. 8 78 Q. 9 A. 10 79 Q. 11 A. 12 80 Q. 13 A. Cohen. 14 81 Q. Cohen? 15 A. 16 82 Q. Where does he live? 17 A. He lives in Swords. 18 83 Q. 19 A. 20 84 Q. 21 A. Kiernan. 22 85 Q. Kiernan? 23 A. 24 86 Q. 25 A. 26 87 Q. 27 A. I would say every one of them. Yes. So, if I said Mr. Des Turvey? Yes. Himself? Yes, most definitely. Mr. Jeremiah.. . (INTERJECTION)? Yes. Yes? In River Valley. Mr. Ton y...(INTERJECTION)? Yes. I see. Yes, Mr. Tony Kiernan. Mr. Dan Cullinane? and M r . ...(INTERJECTION). Who is Dan Cullinane? He is from Limerick. What we had was we broke 28 our Management buy-out up into regions; 29 and Cork. Bill Hennessy was in Cork. Shannon 1 88 Q. 2 A. 4 89 Q. 5 A. 6 90 Q. 7 A. 8 Gerard Anthony That is correct. Is that not correct? Yes. You have Tony Kiernan? Yes. Tony Anthony Kiernan as well I think it is . 91 Q. 10 He is Daniel Anthony Kiernan I think, is that correct? 11 A. 12 92 Q. 13 It could be. Yes. I am not sure. You have Cullinane. Daniel James Cullinane, is that the man? 14 A. 15 93 Q. 16 A. 17 94 Q. 18 A. 19 95 Q. 20 A. 21 96 Q. 22 A. 23 Yes. You have Diarmuid Mary Carpendale? That is me. That is yourself? Yes. You have William Oliver Hennessy? That is correct. What about Finbar John McGrath? He -- they were not -- they didn't join — become Directors until later. 24 97 Q. 25 A. 26 98 Q. 27 A. 28 99 Q. 29 So, you have Jeremiah Cohen. Cohen I think is his name? 3 9 Yes. Did they not? No. So, he is out? He is out. Kenneth Geraghty? 1 100 Q 2 A 3 101 Q Yes . So, you have Mr. Turvey, Mr. Kiernan, 4 Mr. Hennessy, Mr. Egan, Mr. Cullinane, 5 Mr. Cohen and Mr. Carpendale? 6 A 7 102 Q 8 Which of those knew about the system which you have now described to me? 9 A 10 103 Q 11 A 12 13 Exactly. I would say very very few of them. Very few of them? Very few, yes, because it was Des who set the whole situation up. 104 Q 14 Yes. However, he obviously would have consulted you as the Manager of the Firm? 15 A 16 105 Q 17 A 18 106 Q We discussed it. Yes, the two of you discussed it? Yes . Yes, yes. For how long did that last; that system? 19 20 A 21 107 Q 22 A 23 108 Q 24 A 25 109 Q 26 I would say for three years. Three years, is it? Yes . Around that time, three years? Two to three years. Yes. You said in your letter that you were going to discuss the matter with Mr. Turvey? 27 A 28 110 Q 29 A Mr. Turvey refuses to take my telephone calls. Does he? 1 111 Q 2 3 A 4 I have contacted him on four occasions in Finnegan Menton and he just.. . (INTERJECTION). 5 112 Q 6 A 7 113 Q 8 A 9 114 Q Yes, yes? He was to arrange to meet me b u t . . . (INTERJECTION). It never ever transpired? It never transpired. All right. You did mention to us in the letter, 10 or I think it may have been in a telephone 11 conversation that you mentioned it, the 12 reference DT102875? 13 A 14 115 Q 15 A 16 116 Q 17 A 18 yes. What is that? I thought that -- I will explain to you. Yes ? Mr. Turvey came to us -- I will give you a little bit of background, 19 117 Q 20 A 21 118 Q 22 A 23 right? Yes? Because...(INTERJECTION)? Yes? He came to us as Financial Controller in Jackie O'Reilly's day. 24 119 Q 25 A Yes ? Because he was a personal friend of Jackie's solicitor Liam McGonagle. 26 27 120 Q 28 A 29 Yes, Yes? And he was a great friend of I think it was Rue Leonard and all those people in Guinness 1 2 121 Q 3 A Yes ? And as far as I am aware Des was looking after 4 various matters, 5 was conscious of, 6 122 Q 7 A 8 that I was oblivious to but for various people. Yes? Because I think he used to handle the financial affairs of Liam McGonagle. 9 123 Q 10 A 11 Yes ? And I just always remember Des telling me that he operated on a number system. 12 124 Q 13 A 14 Yes ? And that is (indicating) what I assumed was D e s 's number to be very honest with you. 15 125 Q 16 A Yes, I see? Because he used to usually work -- Des was one 17 of the people -- I used to start very early in 18 the morning. 19 and seven o'clock in the evening but I think he 20 was still handling -- at that stage he was 21 still a Director of Finnegan Menton. 22 126 Q 23 I see. Dessie always worked between five So, he was involved in a lot o f . . . (INTERJECTION)? 24 A 25 127 Q 26 A 27 128 Q He was involved in a lot o f . . . (INTERJECTION). Of businesses at that stage? A lot of business at that stage. All right. That is very good. However, you 28 have little doubt that this was the Christmas 29 bonus money? 1 2 All right. That is grand. 3 4 END OF EXAMINATION OF MR. DIARMUID CARPENDALE BY 5 JUDGE O'LEARY: 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 Have you any questions? 2 Just one. 3 4 MR. DIARMUID CARPENDALE WAS EXAMINED AS FOLLOWS BY 5 MS. MACKEY: 6 7 130 Q MS. MACKEY: Mr. Carpendale, 8 you understood at this 9 stage that what Mr. Turvey was doing was he 10 was giving these funds to Mr. Stakelum? 11 A 12 131 Q 13 Yes . What was your understanding of what Mr. Stakelum was doing at that time? 14 A 15 132 Q 16 A Well, we -- I will explain to you the series. Yes? The previous year we had made substantial profits 17 and we had paid an absolute fortune in corporation 18 tax because the rate at that stage was absolutely 19 ridiculous. 20 133 Q 21 A Yes? And we discussed how in God's name we could get 22 away from paying so much corporation tax. 23 actually borrowed money, 24 to pay the corporation tax. 25 134 Q 26 A 27 We which might sound crazy, Yes ? And it really bankrupted the Company over a period of time. 28 135 Q 29 A Yes? I knew Des -- Des came up with this scenario that 19 1 he had -- through connections he had a very good 2 system of giving us money tax free which we all 3 accept was wrong, 4 136 Q 5 A right? Yes ? But he made this arrangement then and he said 6 it was a very very good system. 7 recommended. 8 137 Q 9 A 10 138 Q 11 A It was well Yes? And that was basically it. Yes ? That Mr. Stakelum, he said, ran a very good 12 company and I think it goes back to the days 13 of when Des used to be dealing with people in, 14 and whose names I have seen mentioned in papers 15 in the last few years, 16 people like that, 17 139 Q 18 19 Yes. However, Padraig Collery and Deioitte & Touche so -­ was it your understanding that Mr. Stakelum was investing that money somewhere? A No, absolutely not. My understanding was that 20 Mr. Stakelum was -- I have got to be honest with 21 you, this might sound crazy, 22 question about Mr. Stakelum. 23 140 Q 24 A 25 I never asked the Right? I just knew that when we needed a Christmas bon u s . ..(INTERJECTION). 26 141 Q 27 A 28 142 Q 29 143 Q He was looking after it any way? He was looking after it. Ri g h t . 1 2 3 MS. MACKEY: 4 In other words as far as you were concerned 5 Mr. Stakelum had the money and what Mr. Stakelum 6 did to manage it w a s ...(INTERJECTION)? 7 A 8 145 Q 9 A 10 146 Q 11 A 12 147 Q 13 A 14 W a s . . . (INTERJECTION). You w e r e . ..(INTERJECTION)? I have got to say was absolutely.. . (INTERJECTION). You left it to him? Was none of my business. Yes ? And I have got to say I didn't have a clue what he was doing with it. 15 148 Q 16 A Right. That is grand. That is grand. Ri g h t . 17 JUDGE O'LEARY: That is fine. 18 MS. MACKEY: Thank you very much, 19 Mr. Carpendale. 20 21 END OF EXAMINATION OF MR. DIARMUID CARPENDALE BY 22 MS. MACKEY: 23 24 JUDGE O'LEARY: 25 Mr. Carpendale, thank you very much indeed. 26 MR. CARPENDALE: Not at all. 27 JUDGE O'LEARY: And could I thank you 28 29 very much for the manner in which you have dealt with us. It has explained 1 2 M R . CARPENDALE: Has it? 3 MS. MACKEY: It has, yes. 4 MR. CARPENDALE: I hope it has. 5 JUDGE O'LEARY: We really appreciate it. 6 M S . M A CK EY : That is grand. 7 JUDGE O'LEARY: Thank you very much indeed. 8 9 10 MR. CARPENDALE: That is no problem. Thank you. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Thank you. THE INTERVIEW THEN CONCLUDED. 6 YOan a3 Swag? 1 0R O ’REILLY A E R L O D (IRELAND) LIMITED Registration Details COMPANY NAME PREVIOUS NAME BUSINESS NAMES REGISTERED NUMBER COMPANY TYPE COMPANY STATUS HOLDING COMPANY ULTIMATE HOLDING COMPANY REGISTERED ADDRESS: TRADING ADDRESS: HANOVER HOUSE 88/89 SOUTH MAM STREET CORK. TELEPHONE FACSIMILE ACTIVITIES Room 206,Cargo Terminal, Dublin Airport, Dublin 01 8444103 01 0444282 Tha transportofcargo by air. 0"REBXY AERLOD (IRELAND) LIMITED 109118 PRIVATE LIMITED BY SHARES LIQUIDATION Labac Limited Financial Details INCORPORATED SHARE CAP.CURRENCY ISSUED SHARE CAPITAL AUDITORS BANK SORTCODE 14/08/1985 MDEBTEDNESS AT LAST AR ANALYSED 0 IRP LAST AR PILED 1S/07/1M2 179000 LAST AR REGISTERED 18/07/1992 Haughay Boland Deioitta1 Touch*, EaritfortTarraca, DUBLIN AllladIrishBank Pic Liquidator / Examiner I Receiver Details TITLE TYPE OF APPOINTMENT APPOINTED CEASED NAME 01/03/1998 EDMOND P.CAHILL GRATTAN COURT 29/31 WASHINGTON STREET CORK Mortgage Details MORTGAGE SATISFACTION TYPE CREATION REGISTERED CURRENCY AMOUNT DUE AMOUNT SECURED PERSON ENTITLED MORTGAGE SATISFACTION TYPE CREATION REGISTERED CURRENCY NotSatisflad LETTER OF SET OFF 17/08/1986 06/08/1986 IRISH POUNDS No Flxad Amount Spaefflad ALL SUMS NOW DUE OR HEREAFTER TO BECOME DUE FROM THE COMPANY TO THE PERSON(S) E ALLIED IRISH BANKS PLC BANKCENTRE BALLSBRIDGE DUBLIN 4 2 NotSatisflad A DEBENTURE 12/10/1987 30/10/1987 IRISH POUNDS http, .//www.irion.ie/members/details.asp?id“gmlfymxdbajbbih 12/11/01 IRION AMOUNT DUE AMOUNT SECURED ™ nr?”"??! B06 0R h ereafter t o THE rtsRSONfS) E PERSON ENTITLED b e c o m e d u e f r o m t he c o m p a n y t o ALLIED IRISH BANKS PLC BANKCENTRE BAUSBRIDOE DUBLIN 4 Members Details COMPANY SEC DIRECTORS Mr. Desmond Edwin Tuivay Mr. Daamond Edwin Turvey Mr. Kenneth Geraghty Mr. FinbarJohn McQnth Mr. DanielAnthony Neman Mr. William OliverHsnnsasy Mr. Brandan PatrickEgan Mr. DanM Jamaa Cullinana Mr. Gerard Anthony Cohan Mr. Diarmuid Mary Carpendale Document History (Latest 15) E4 •Liquidator* Affidavitft3.306 Account* RECEIVED 18/10/2001 E4 -Liquidator*AffidavitftS.306Account* REGISTERED 30/08/2001 E3 >Liquidator*Accounts Of Actions ftDaallnga REGISTERED 30/09/2001 E3 -LiquidatorsAccounts Of Actions ftDaallnga REGISTERED 19/10/2000 E3 •Liquidator! Account* Of Actions ftDealing* REGISTERED 19/10/2000 E4 •Liquidator* AffidavitftS.306Accounts REGISTERED 28/090000 E4 •Liquidators AffidavitftS.306 Accounts REGISTERED 28/09/2000 E4 >LiquidatorsAffidavitftS.308Accounts REGISTERED 28/09/2000 E4 ■ LiquidatorsAffidavitftS.306Accounts REGISTERED 28/09/2000 E4 •LiquidatorsAffidavitftSJO# Accounts REGISTERED 28/09/2000 EFFECTIVE 31/08/2001 EFFECTIVE 28/02/2001 EFFECTIVE 28/02/2001 EFFECTIVE 28/02/1908 EFFECTIVE 29/02/2000 EFFECTIVE 31/08/2000 EFFECTIVE 29/02/2000 EFFECTIVE 31/08/1999 EFFECTIVE 28/02/1099 EFFECTIVE 31/08/1998 A highly detailed company profile can be ordered from CFI Online, Click here While historically accurate, users should be aware that company records may have changed as a result of the recent filing of documents at the Companies Registration Office. For an up to date report, CFI ONLINE recommends that a full company search should be completed. ©CopyrightCFIOnlineLimited 1999 http://www.irion.ie/membcrs/details.asp7id-gmlfymxdbajbbih 12/11/01 A Htmbcr oftimHenryAmbmehtr HoUUngs PIC Mtrchant Banking Croup Please replyto: 42 Fitrwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 G a r e t h Logan, Esq., Irish Intercontinental Bank L i m i t e d ^ 91 M e r r i o n Square D U B L I N 2. P.O. Box 1*7, Giand Cayman, British Wat Indies Phone: (809) 949-4633/4 Telex: CP 4305 Fax: (809) 949-7944 (109) 949-326? 22nd January, D e a r Gareth, C o u l d y o u please arrange to lodge the e n c l o s e d c h e q u e for S t g . £ 6 , 2 8 4 . 5 0 to the credit of A n s b a c h e r L i m i t e d A c c o u n t No. 01 087/02/81.'. Yours sincerely, or A N S B A C H E R L I M ITED /AJW 1991 . a: ?1lv to ?mu'w. 0? .Ne-Vg?g o-dp.000 o. .u 3? .. . o, 2.22?p1d1- Dmunseen ac 1' 1-, than, us?: one Mum? - Lnororder 3.5 0 I ER VICESHannah- ao-?ausu autumn..- . .. u. .- no mmlrt". '9 .u't I . . K. Appendix XV (101) Mr Dermot O’Reilly-Hyland, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Dermot O’Reilly-Hyland. a) Extract of Central Bank Report into Guinness and Mahon as at 30 April 1978. b) Internal Guinness and Mahon document entitled ‘balances as at 17 August 1982’. c) Internal Guinness and Mahon memo of 18 April 1977 - JD Traynor to GB. ■ APPENDIX TEN TO EXAMINATION REPORT AS AT 3®APRIL 1978 MAJOR LOANS BACKED BY “DEPOSITS" HELD IN CAYMAN/GUERNSEY TRUST COMPANIES Borrower 3flAprO 1971 Cayawi Gwnwr ft ft ft 264,167 147,967 B A L A K C H A 8 AT 17TH A P 0 P 8 T. 1982 D. O'Ballly-Hjrland Sterling Loan 107,843.05 Dr. Sterling Loan 2 0,818.38 Dr. 8,188.78 Dr. S t a r l i n g C u r r a n t Account 83,087.87 Dr. IBS L o a n P O S I T B A L A l C I i AS i f 1TB A P O P 8 T. 107,*43.*5 Cr. tt N "FI" 3 0 ,818.38 Cr. nn * 8,185.78 Cr. "13" 108,436,90 Cr. -o—o —0 —0 —O — 1982 J .D .T . to C.B. a*: 18th April, 1977. Deraot O'Beilly-Hyland G.R.A. ShirM fu^ th*T to our Atr*«Ct ^ x '-'Gwt INTWUT RATI DtUT NAME C* ACCOUNT t> v 9^Ue. INTMUT RATI CUDIT (l> chanccs C ' NOTIS. AUTHOKtMcTir s ' ■**— 3etHjl7 jp A l«» J J 1NTUUKT RATI CUDIT 1> * OIMT rOSTINO INHItlTOft J Appendix XV (102) Mr Ken O’Reilly-Hyland 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Ken O’Reilly-Hyland. a) Transcript of evidence of Mr Ken O’Reilly-Hyland dated 22 June 2000. b) Extract from appendix 3 of Central Bank Report into Guinness and Mahon as at 30 April 1978. c) Letter of 24 December 1986 - MJ Pender to BA Ursell. d) Letter of 11 May 1990 - Martin Lanigan O’Keeffe to JD Traynor. e) Undated letter of guarantee addressed to Guinness and Mahon. f) Extract from Central Bank report into Guinness and Mahon. g) Internal Guinness and Mahon memo of 29 April 1986. h) Guinness and Mahon statement of 5 May 1986 re GMCT. i) Guinness and Mahon statement of 29 April 1986 re Guinness and Mahon a/c no 03274004. j) Summary of a/c no 101751506 1985-1986. k) Letter of 29 July 1991 - Ansbacher Limited to IIB. 1) Telefax of 22 March 1994 - JA Furze to IIB. m) Notes to the accounts re GMCT and subsidiary companies. n) Guinness and Mahon credit committee memo of 17 January 1989. o) Guinness and Mahon credit committee minute of 25 January 1989. p) Guinness and Mahon credit committee minute of 26 January 1989. q) Statement of Ken O’Reilly-Hyland dated 21 June 2000. r) Telex of 19 May 1977 - Guinness and Mahon to GMCT. Correspondence received from or on behalf of Mr Ken O’Reilly-Hyland. a) Letter of 11 December 2001 - Whitney Moore & Keller Solicitors to Inspectors. b) Letter of 15 January 2002 - Whitney Moore & Keller Solicitors to Inspectors. c) Letter of 22 Februaiy 2002 - Whitney Moore & Keller Solicitors to Inspectors. MR. KENNETH P. 0'REILLY-HYLAND UNDER OATH ON THURSDAY, 22ND JUNE 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer MR. JUSTICE COSTELLO MS. MACKEY B.L. SOLICITOR TO THE INSPECTORS: MS. M. CUMMINS INTERVIEWEE: MR. KENNETH P. 0'REILLY-HYLAND REPRESENTED BY: MR. RICHARD LAW NESBITT S .C. INSTRUCTED BY: MR. GERARD CARROLL WHITNEY MOORE & KELLER WILTON PARK HOUSE WILTON PLACE DUBLIN 2. 1 2 3 4 MR. JUSTICE COSTELLO: 5 We will start our interview now, 6 Mr. O 'Reilly-Hyland. 7 Declan Costello and on my right is Ms. Mackey. 8 you know, we have been appointed Inspectors by the 9 High Court. I will introduce myself, I should explain to you, I am As as I am sure 10 your legal advisors have already explained to you, 11 this is not a Court, 12 interview. 13 wish to consult your legal advisors, please tell us 14 and we will stop asking you questions and you can 15 discuss the matter with your counsel and solicitor. 16 If during the course of the questions your legal 17 advisors wish to advise you on any matter, 18 indicate the same to us and we will stop asking you 19 questions. it is not a Tribunal, it is an If in the course of the interview you they can 20 21 Mr. 0'Reilly-Hyland, 22 under oath and I will ask our solicitor now, 23 Ms. Cummins, 24 25 26 27 28 29 the evidence will be taken to administer the oath to you. 1 2 3 4 MR. NESBITT: Perhaps I could just 5 indicate that Mr. 0'Reiiiy-Hyland is under compulsion. 6 7 1 Q. MR. JUSTICE COSTELLO: 8 Of course, we understand. Mr. 0'Reilly-Hyland, 9 I would like to begin this by referring you to a 10 document that I know you are familiar with, 11 report of the Central Bank about the loans that 12 Guinness & Mahon had made up to 30th April 1978, 13 Tab 4 in our documents. 14 You see this is Appendix 3 to the Central Bank 15 report, 16 and it shows at no. 7: 17 (SAME HANDED) it is a (Exhibit 1). it is the top ten loans of 30th April 1978 "K.P. 0'Reilly-Hyland Beresford Investment Limited £616,000." 18 19 20 Do you see that? 21 A. 22 2 Q. 23 24 27 28 29 I do, Judge, I do indeed. That is used and that is the company with which you were associated? A. 25 26 Yes, That is me, but first I heard of this company was last October. 3 Q. We will move on then. Do you see the next page, says : "K.P. 0'Reilly-Hyland Beresford Investments Limited £616,023." it 1 2 3 account, 4 shows the total and then it shows Beresford 5 Investments. 6 £416,467. 7 a n o . 2 account and a current account, it Then it analyses your loans of It says: "The No. 1 account is secured by an identical deposit held with the wholly owned subsidiary of Guinness Mahon Dublin in the Cayman Islands." 8 9 10 11 Could you explain that to us, Mr. 0'Reilly-Hyland? A. 12 13 4 Q. first of all, until last October I Leave aside Beresford for the moment, just your own personal loans. A. 16 17 Judge, never heard of Beresford Investments. 14 15 Well, I certainly never hypothecated any of my Trust monies to Guinness & Mahon, never, ever. 5 Q. "No. 1 account is secured by an identical deposit with the wholly owned subsidiary." 18 19 20 21 What does that mean, do you think? A. 22 Mahon Cayman Trust Company Limited. 23 6 Q. 24 A. 25 7 Q. 26 A. 27 I would assume that there was a deposit in Guinness 8 Q. 28 A. 29 9 Q. It was used as a security for the loan? No. Is this wrong then? This is not correct. I see. It is quite incorrect. If you just look at the next page, page 79. (SAME 1 2 "Loans Backed by deposits 3 The bank engages in two types of loan under this heading: (1) Normal back-to-bank lending, (2) Lending back-to-back the bank has the security of a deposit whe re. .. . 4 5 (1) Back-to-Back Loans. These loans in total amount to approximately..." 6 7 8 9 It gives the total. 10 "The major loans are..." 11 12 Then it gives one company and then you, £580,000; 13 that correct? 14 A. 10 Q. 17 18 Sir. I never had a back-to-back loan. 15 16 That is not correct, is Do you see that the backing deposits are held in the Cayman Islands, A. is that incorrect? That is not correct. Any facilities I have from 19 Guinness & Mahon were backed by securities in 20 Ireland. 21 11 Q. 22 A. 23 12 Q. 24 A. 25 13 Q. And not by any use of a deposit? Not by any use of a deposit in Cayman. Or anywhere? Or anywhere else. I am sure, Mr. 0'Reilly-Hyland, you are familiar 26 with the evidence that has now been in the public 27 domain about the way in which what have been called 28 the Ansbacher Deposits, 29 the Cayman subsidiary in Ireland were used as that is to say deposits of 1 2 3 Yes, 4 14 Q 5 A I have read this, Judge, and I am aware of it. What was your understanding of what was going on? Well, I don't know what was going on, but the first 6 time I saw my name mentioned in this was at the 7 Moriarty Tribunal. 8 15 Q 9 I just want to leave that aside for the moment, your own personal involvement which we will come to 10 later. 11 the use of Guinness & Mahon in Ireland and the 12 deposits which their subsidiary had in Dublin as 13 security for loans, I want to find out your understanding now of did you know about this? 14 A 15 16 Q 16 A 17 17 Q What is your understanding of what was happening? 18 A My understanding is that Mr. Traynor has said and 19 No, and they weren't authorised by me. Have you learned about it since? Only since the Moriarty Tribunal. written things which were false and untrue. 20 18 Q 21 A Tell me what he said was false and untrue? We have it here; 22 back-to-back, 23 is not true. 24 19 Q "the major loans involvement K.P. 0'Reilly-Hyland £580,000," that That loans to you were not secured by either a 25 deposit that was held in the Cayman Islands or a 26 matching sum that was held in Dublin in the name of 27 Ansbacher? 28 29 A No. 1 No. 2 schedule of securities backing any facilities I have 3 had. 4 21 Q 5 A 6 22 Q Judge, may I assist here by saying there is a Pardon, there is a schedule of securities? Yes . Were you aware of the evidence that has been given 7 and I think has been given in the public also, 8 Mr. 0'Reilly-Hyland, 9 internal memoranda of Guinness & Mahon of the phase 10 "suitably secured," 11 phrase? 12 A 13 14 of the use of the phrase in the have you come across that I have come across that in the recent past, very recent past. 23 Q Is it your understanding that the Guinness & Mahon 15 Credit Committee and Board of Directors used that 16 phrase to indicate that the loan was secured by an 17 Ansbacher deposit? 18 A 19 24 Q 20 A 21 25 Q That is what I have learned in the recent past. You did not know that before? I did not know that before. You say that this is incorrect, this information 22 that the Central Bank have. 23 Mr. Traynor who gave it to them and that he was 24 untrue, 25 A You say that it was it was untrue? Quite untrue, yes. 26 It would not only have been Mr. Traynor who would 27 have been misleading the Central Bank, 28 been the Board of Guinness & Mahon; would it not? 29 it would have 1 2 27 Q. Others in Guinness & Mahon? 3 A. Others in Guinness & Mahon, 4 28 Q. yes. Am I not correct, Mr. 0'Reilly-Hyland, that the 5 Central Bank were investigating the activities of 6 this company, 7 explanations from Guinness & Mahon about it and 8 actually had interviews with representatives from 9 Guinness & Mahon? 10 A. 11 29 Q. 12 A. 13 30 Q. this subsidiary and had asked for So I learned on 9th March this year, Judge. You did not know that before? I did not know that. I suggest to you a possibility, Mr. 0'Reilly-Hyland, 14 namely, 15 way we have been discussing but without your 16 knowledge, 17 A. 18 31 Q. 19 20 that in fact these loans were secured in the is that possible? Entirely. So they were being secured but you accept they were secured but without your knowledge, A. Well, is that it? if they say they were secured, I don't know 21 how true it is, but I lodged deposits with Guinness 22 Mahon Dublin for secure facilities I got from them. 23 They had no authority whatsoever to use my Trust 24 funds in the Caymans to secure any loan in Dublin or 25 anywhere else because, 26 hedge against Lloyds. 27 32 Q. 28 A. 29 33 Q. Judge, this is meant as a Sorry? This Trust fund was meant as a hedge against Lloyds. We will come to that in a moment. I want you to 1 2 2) memorandum in Guinness & Mahon dated 3 24th December 1986. 4 M.J.P to B.A. Ursell (SAME HANDED). It is from 5 "Dear Bruce 6 As requested, I list hereunder particulars of accounts for which we hold backing deposits with G M C T ..." 7 8 9 He gives the list. 10 Then at B: 11 "Resident accounts for which we hold deposits from GMCT to be hypothecated. C.P. 0'Reilly-Hyland - £4 93,296.38." 12 13 14 Just let's take it in stages. 15 statement by the writer of this memo to Mr. Ursell 16 that your loan was secured by a deposit which was 17 duly hypothecated in the Cayman Islands, 18 what it says; is it not? 19 A. 20 34 Q. This is clearly a that is That is what it says and that is not true either. Just let's get what you are telling us, 21 Mr. 0'Reilly-Hyland. 22 author of this memorandum has stated is a lie? 23 A. Are you saying that what the What the author of this states is what somebody else 24 has told him. 25 standing Trust was that it stood alone. 26 35 Q. The whole purpose of having this long I will come to that later, Mr. 0'Reilly-Hyland. 27 What I am suggesting to you is that these documents 28 show that these deposits were used in the way 29 suggested. Are you denying that they were used in 1 2 I think these deposits according to these papers 3 were wrongfully used. 4 36 Q I understand now what you are saying. You are 5 accepting that the bank used them but they used them 6 wrongfully, 7 A 8 9 is that what you are saying? Largely because I have no option. This is what the document says, but they had no authority from me. 37 Q That is what I want to find out, what your 10 suggestion is. 11 but you are now accepting, 12 Mr. 0'Reilly-Hyland that these documents indicate 13 that this use was made of these deposits but you are 14 saying it was without your authority? 15 A 16 38 Q They had no authority to use this, are you not, That's correct. Very well. Do you see the figures that I have been 17 quoting to you from these accounts, 18 in the region of £616,000 in the Central Bank report 19 and in the other report loans of £493,000. 20 figures are correct, 21 amounts of the loans that you had then? 22 A I take it? seen these. 24 Beresford as far as I am aware. 39 Q 26 A 27 28 29 These These are the I don't know because this is the first time I have 23 25 they show loans Certainly I had nothing to do with Sorry? I don't know because this is the first time I have seen these figures. 40 Q It is a long time ago, but you are not suggesting that the figures are wrong; are you? 1 2 right either because I have not seen them before. 3 Beresford Investment, 4 41 Q. I know nothing of that. Doing the best you can is that the sort of figures 5 you were borrowing from Guinness & Mahon at that 6 time? 7 A. 8 42 Q. 9 It could be. It could be, yes. I just want to show you another document, page 41 and 42. (Exhibit 3) (SAME 10 HANDED). 11 Lanigan-0'Keeffe to Mr. Traynor in May 1990 and he 12 says : This is a letter by Mr. Martin 13 "Dear Des 14 I refer to your letter of 17th April. The attached schedule sets out the account details requested as at 31st March 1990. 15 16 I have discussed this briefly with Padraig, but if there are any queries perhaps you would let me know." 17 18 19 Then there is a list given. 20 is that the list is a list of loans which were at 21 that time secured on deposits, Ansbacher deposits. 22 Do you see the figure of £200,000? 23 A. 24 43 Q. 25 A. What I suggest to you I do. Would that be about correct in 1990, do you think? I don't know, Judge, but what I do know, Judge, 26 looking at this sheet is the sterling loans to my 27 daughter Aislinn and my son Kenneth, 28 loans, 29 not money and we paid 1% per annum. those were not those were guarantees for Lloyds. They were They were 1 2 4 4 Q. Were your daughter Aislinn and your son Kenneth 3 subscribers at that time in London and they were 4 guarantees, 5 A. 6 45 Q. 7 A. 8 46 Q. 9 10 were they? They were guarantees on which we paid 1% per annum. Who gave the guarantee? Guinness & Mahon. What security did Guinness & Mahon require for the guarantee? A. It was on my Irish assets which were quite 11 considerable. 12 of them. 13 47 Q. It was only £70,000 between the two So it was secured. The guarantee that Guinness & 14 Mahon had given for your daughter and son was 15 secured but you think it was not on an Ansbacher 16 account? 17 A. 18 48 Q. Quite sure it wasn't. I want to refer you to some other documents and it 19 is on the same topic, page 86. 20 that you gave 21 22 23 24 25 26 This is a guarantee (Exhibit 4): "In consideration of your placing at the disposal of Beresford Investments Limited... (Hereafter referred to as "Principals", a loan facility of £72,500, seventy-two thousand, five hundred pounds) on terms andconditions set out in your letter addressed to you to the principals. We the undersigned L.G. McGonagle, K.P. 0'Reilly-Hyland, J.D. Traynor, J.J. Finnegan, S. Stephenson and Arthur Gibney hereby guarantee to you..." 27 28 There is a guarantee there and it is signed over the 29 page then. 1 A. 2 49 Q. 4 A. 5 50 Q. 6 that this was a guarantee Sorry? This was a guarantee from Guinness & Mahon, was it? It is a guarantee for the loan that Guinness & Mahon were giving to Beresford Investments? A. 8 9 Judge, from Guinness & Mahon? 3 7 I am just checking, I know that it is fashionable today, Judge, to have occasional amnesia but I don't remember that. 51 Q. 10 Let's take it in stages. Mr. McGonagle, the solicitor. 11 A. 12 52 Q. 13 A. 14 53 Q. 15 A. 16 54 Q. 17 I knew him very, very well. Was he acting as your solicitor? Yes. At the time? Yes. Mr. 0'Reilly-Hyland then is next. Mr. Traynor, did you know Mr. Traynor? 18 A. 19 55 Q. 20 A. 21 56 Q. 22 A. 23 57 Q. Who was Mr. Finnegan? 24 A. Finnegan Auctioneers. 25 58 Q. 26 A. 27 59 Q. 28 A. 29 60 Q. Indeed I did. That was in 1970? Yes. Mr. Finnegan? Yes. Stephenson and Gibney? Yes. You knew them? Yes. Would you turn over to page 88. (Exhibit 5) (SAME 1 2 report. 3 this is much later, this is 1978. 4 It is Beresford Investments £199,556 and "Mr. K.P. 0'Reilly-Hyland has the majority shareholding in this company." 5 6 Is that correct? 7 A. 8 61 Q. 9 A. I don't think so, I am not positive about it. Sorry? I am not positive about it, Judge, because I have 10 never heard of any company Beresford Investments 11 although I have signed a guarantee for it. 12 totally baffled by this. 13 62 Q. 14 A. 15 63 Q. I am You say you never heard of it? Yes, I am totally baffled by it. "The purchase of property comprises of warehouses and some office space in Capel Street area." 16 17 18 Were you involved in a development? 19 A. 20 64 Q. No, I developed no property in Capel Street. Then the information in this report is completely 21 wrong then in your view. 22 arrangements with Mr. McGonagle, 23 Mr. Finnegan and the architects? 24 A. 25 Mr. Traynor, Yes, we had been in Fitzwilliam Lawn Tennis Club and various properties. 26 65 Q. 27 A. 28 66 Q. 29 Did you have any financial Developing? We built a tennis club. It was a development company, was it? 1 67 Q. 2 A. 3 68 Q. 4 A. 5 69 Q. No, the company that developed Fitzwilliam. Yes, was called Malborough Holdings. Malborough Holdings? Yes. Did you have other developments with this same group 6 of people? 7 named there in Beresford Investments? 8 A. 9 70 Q. 10 It is the same group, yes, the same group. Then you had other developments outside Fitzwilliam, where else did you develop? 11 A. 12 71 Q. 13 Fitzwilliam only as far as I know. Did you not have other joint ventures with these others ? 14 A. 15 72 Q. 16 17 Was it the same group of people that is Not with these people. Can you give me any explanation why the Central Bank report would be wrong then about this company? A. I honestly can't, Judge. Firstly, I don't remember 18 Beresford Investments. 19 like this it is most unlikely that anybody would 20 have a majority shareholding. 21 Mr. Traynor embarked on this exercise, 22 wearing his New Ireland hat of which he was a 23 director at the time, 24 have been part of Fitzwilliam, but I have no 25 recollection of Beresford Investments. 26 never developed any property in Capel Street. 27 28 29 73 Q. Secondly, I think. in a situation Thirdly, if it would be I think this may I certainly The signature to the guarantee is your signature, it not (Exhibit 4)? is 1 74 Q 2 A 3 75 Q 4 A 5 But you cannot recollect it? I can't, mind you it is a long time ago. How many years ago is it? 6 76 Q 7 A 8 9 I did. This was signed 30 years ago. It certainly is my signature and such a consortium did exist, but it existed for a different purpose. 77 Q 10 Why I am drawing your attention to it is if you go back to the Central Bank report at C 11 (Exhibit 5): "The loan is 100% secured by deposit balances held with a wholly owned trust subsidiary of Guinness & Mahon in the Cayman Islands." 12 13 14 You know nothing about that? 15 A 16 78 Q Nothing at all, Sir. Who was the principal person in this group of people 17 that were involved at that time in 1970 with you? 18 Was it Mr. McGonagle, 19 Mr. Finnegan or was it Mr. Traynor? 20 active person in the group? 21 I will explain, 22 what happened, 23 Goulding made a bid for Fitzwilliam Lawn Tennis Club 24 which backed on to a property owned by Sam 25 Stephenson and Arthur Gibney. I think both of those 26 gentlemen said to Des Traynor, 'you know, this is 27 such a good site that we should put a consortium 28 together for this because there is another site on 29 Appian Road.' was it the architects, was it Who was the if I am not taking up too much time, Judge. What happened was Basil I think John Finnegan helped to put 1 this site together on Appian Road which contained 2 some residential housing in poor condition and the 3 idea was to do a swap of a finished tennis club. 4 79 Q. I do not want to stop you Mr. 0'Reilly-Hyland, you 5 are telling me about the development that you had 6 with these gentlemen and I understand it, but I am 7 not concerned with that. 8 other developments that you might have undertaken 9 with these other gentlemen, 10 11 I am concerned with the can you recall other developments ? A. I don't think I have undertaken any others with 12 these gentlemen for a variety of reasons, 13 including clash of personality. 14 80 Q. 15 A. 16 81 Q. Judge, The clash of personality was not with Mr. Traynor? Not at that stage. I want now to deal with another matter entirely and 17 that is the payment to you in April 1986 of a sum of 18 £75,000 and I want to show you some documents in 19 relation to it; pages 31, 32, 33 and 34. 20 HANDED). 21 an internal Guinness & Mahon memo of 29th April 22 1986, 23 Commerce, 24 0'Reilly-Hyland and then the account in the Marbella 25 branch. 26 £75,000 27 A. 28 29 (SAME This was in 1986 and the first document is and it is £75,000 to the Bank of Credit & Frankly, Leadenhall Street, London, account K.P. Do you remember getting a transfer of (Exhibit 6)? no. If I did, I am wondering what I did, don't remember it. 82 Q. The documents show that you had an account in the I 1 Bank of Credit & Commerce in Marbella, did you? 2 3 83 Q. 4 5 Did you have any sums at all in any London bank and in Marbella? A. The only London bank I think I had a current account 6 balance were two; 7 Mahon in London, 8 small petty cash account in Barclays Bank at 9 160 Picadilly. 10 84 Q. 11 A. 12 85 Q. I had an account with Guinness & a current account. I also had a So you had an account in Guinness & Mahon in London? That is my understanding. If you just turn to the ledger accounts (Exhibit 7) 13 that we have given you. 14 debited in the Guinness Mahon Cayman Trust Limited 15 deposit from subsidiary of a sterling account on 16 that date, 17 photostat of a Guinness Mahon & Company London 18 account -- sorry, 19 Company showing its account with the Dublin 20 subsidiary Guinness & Mahon Limited and it shows 21 there a debit of £75,000. 22 see your name 23 A. I do, 24th April. 25 with i t . 27 A. 28 87 Q. 29 the London bank, I see it, Judge, 0'Reilly-Hyland. 86 Q. There is a very indistinct Guinness Mahon & Do you see that, do you (Exhibit 8)? 24 26 You see the £75,000 is and I see the name Edmund I don't know what that has to do Is he a relation of yours? He is, he is a nephew of mine. That is £50,000, but your name is above that at 1 2 88 Q. 3 A. 4 89 Q. Page 33, have you got page 33 I am looking at the wrong one. This is difficult to read. 5 there, 6 bank. 7 A. 8 90 Q. 9 (Exhibit 7)? (SAME HANDED). Do you see the top "Guinness Mahon & Co., that is the London Yes. Do you see on the left-hand side the name of the account holder is Guinness & Mahon Dublin, 10 account. 11 A. 12 91 Q. current That is the Dublin branch? Yes. Do you see three quarters of the way down, and it is 13 very hard to make it out, but you can see Mr. K.P. 14 0'Reilly-Hyland £75,000 and underneath that Edmund 15 0'Reilly-Hyland; 16 A. 17 92 Q. 18 I don't to be quite honest about it. We will give you a highlighted one. (SAME HANDED). Do you see now, that they are debiting? 19 A. 20 93 Q. 21 A. 22 23 do you see that? How much are they debiting here? £75,000. Is that the £75,000 that is supposed to have been sent to me in Marbella? 94 Q. Yes. Then the next document is a Dublin bank, 24 Guinness & Mahon Dublin. 25 account, 26 £75,000 is credited in their Nostro account. 27 am suggesting to you is that you got £75,000 and it 28 was charged on the Ansbacher account in Guinness & 29 Mahon in Dublin It is their sterling their Nostro account and the transfer of (Exhibit 8)? What I 1 I knew nothing about an Ansbacher account until the 2 recent past. 3 I know that and I know what you are telling me, but 4 I am suggesting to you that these documents show 5 that you got £75,000 and show how it was treated in 6 the bank's records. 7 A I don't know what the treatment of the account was, 8 Judge, but I thought that my assets situation would 9 stand £75,000 quite easily. 10 come into it, 11 96 Q 12 A 13 97 Q 14 A 15 98 Q How Ansbacher could I just don't know. Can you remember getting the £75,000? No. You cannot? No. I want to come to a further sum of money in relation 16 to the payment of Stg£350,000 in July 1991. 17 HANDED) 18 is a letter. 19 will see it is headed "Ansbacher" and it gives the 20 address of Ansbacher in the Cayman Islands. 21 says : 22 (Exhibit 10). This is in July 1991, this is It is signed by Mr. Traynor and you "Reply to Fitzwilliam Square." 23 24 25 26 27 28 29 (SAME It is a letter to the IIB and it says: "Would you please arrange a transfer of the sum of Stg £350,000 to the current account of Paul H. 0'Reilly-Hyland at Hong Kong, Shanghai Bank Corporation in Hong K o n g ..." Then it 1 "The funds should be placed on Tuesday 6th A u g u s t . The debit should be to Ansbacher Limited call deposit account..." 2 3 4 It gives the number of the call deposit account. 5 will deal with the details of this letter in a 6 moment, Mr. 0'Reilly-Hyland, 7 me about the payment to your son of this sum? 8 A. 9 Yes, Judge, I can do that. I but could you just tell Some time in the early 1990's when we were extremely short of money to pay 10 these enormous Lloyds debts, 11 start using this Trust which Guinness & Mahon had. 12 It was based in Cayman to keep it out of the reach 13 of Lloyds and that we should make a withdrawal from 14 that. 15 99 Q. 16 A. I thought we should He said to m e ...(INTERJECTION). Who? Traynor said to me, 'we should pay a capital 17 dividend, 18 beneficiaries.' 19 position worked and this is precisely how it worked. 20 My daughter Aislinn shared her share with her sister 21 Elsbeth. 22 and Mummy and I used our shares to keep the family 23 going. 24 money again, we asked for this money and he said, 25 'no, the way to do this is to pay it by way of 26 capital dividend' 27 0'Reilly-Hyland in Hong Kong and you can make your 28 own arrangements with h i m . ' 29 not to you, but to one of the other I explained to him how our Lloyds My son Kenneth shared his share with Paul Now at this time when we were very short of or capital something 'through Paul 1 A. Paul had just left Hong Kong and he had moved to New 2 York, but I don't think he moved his banking 3 facilities at that time. 4 101 Q. So you discussed the situation with Mr. Traynor and 5 as a result of that a sum of Stg£350,000 was paid to 6 your son Paul? 7 A. 8 102 Q. 9 A. 10 103 Q. 11 A. 12 104 Q. 13 14 A. He sent it back to Guinness & Mahon in Dublin. Into whose account? To my account. What sort of account was this? Was it a resident A resident current account, a normal domestic account. 16 105 Q. 17 A. 18 106 Q. 19 What did you do with the £350,000? Paid Lloyds. I paid Lloyds, Judge. So out of the money that was in Cayman you paid Lloyds ? A. 21 22 What did he do with it? current account? 15 20 That's right. Yes, in part, there wasn't enough to pay the full Lloyds bill. 107 Q. I want to refer to another payment. Sorry, I should 23 have finished with the July 1991 arrangement. 24 we just go back to this letter that I referred you 25 to from Mr. Traynor. 26 10) ? 27 A. 28 108 Q. 29 Yes, Have you got it there Can (Exhibit I have it, Judge. Whilst the money went to Paul and then came back to 1 your a t t e n t i o n to what happened in here in Dublin. 2 F i r s t of a l l , t h i s money came from the I r i s h 3 In te r co n ti n e n t al Bank, do you see t h i s l e t t e r 4 (Exhibit 10)? 5 A. 6 109 Q. 7 I do, Sir. I t came from the Ansbacher Limited c a l l deposit account and i t gi ve s a number, i s that right? 8 A. 9 110 Q. 10 That's corr ect . The IIB trans fe rre d Stg£350,000 to Hong Kong and t h i s amount was debited to the Ansbacher account? 11 A. 12 111 Q. 13 A. Yes. May I make a point, Judge? Sure, yes. I t i s the f i r s t time I have seen any correspondence 14 about Ansbacher. 15 the I r i s h I nt e r co n tin e nt al Bank to have any input. 16 I thought i t came d ir e c t from Guinness & Mahon. 17 112 Q. It i s the f i r s t time I have known I appreciate that you did not know how the tr a n s fe r 18 was made, but i s i t not c le a r that the tr a n s fe r was 19 made by deducting t h i s sum from the Ansbacher 20 account and there was a corresponding deduction then 21 in the monies that you held in Cayman? 22 A. 23 113 Q. 24 A. Yes, the Trust money. 25 114 Q. We w i l l come to th a t. That's r ig h t, the Trust money. The Trust money? I want to r ef er you to 26 another memo. 27 i t i s headed a "Trust Group." 28 quite bad. 29 a l l , had you met Mr. Furze (Exhibit 11)? This memo i s signed by John Furze and The photostat i s It i s from the Cayman Islan ds. F i r s t of 1 2 Do you see i t i s from John Furze and i t i s to the 3 I r i s h In te r co n ti n e n t al Bank. 4 a t t e n t i o n of Mr. Redmond and the date i s in 1994 and 5 then: 6 It i s for the "Would you pl e as e trans fe r GBP£161,376.29 to Guinness & Mahon Ltd, College Green, Dublin 2, Ireland for the account of Kenneth P. 0 ' Reilly-Hyland by order of Paul M. 0 ' Reilly-Hyland for value 31 -03-94. 7 8 9 Please advise Guinness & Mahon to n o t i f y t h e i r c l i e n t of t h i s t r a n s fe r . Debit our own account 02/01087/81." 10 11 12 13 Do you remember g e t t i n g t h i s sum of Stg£161,376? A 14 15 No, I do not, Judge, ne ith er would my son Paul have my authority to give any such order to anybody. 116 Q I t would be a simple matter, would i t not, to find 16 out was that sum transfe rre d int o your account in 17 Guinness & Mahon Dublin, can you do that for us? 18 A 19 Yes, Sir, I w i l l indeed and I s h a l l t a l k to my son Paul, i f I may quote t h i s document? 20 117 Q 21 A Of course. Because he would have t o l d me, he had no aut hority. 22 The only person with authority who kept the whole 23 thing was Mr. Traynor. 24 Trustees or the Trustees would advise him. 25 a big who-ha about t h i s , Judge. 26 aut hority and wouldn't do anything of t h i s s o rt . 27 I w i l l come to i t but as you have r a is e d i t now, did 28 any of your family als o have Trusts? 29 Des Traynor would advise the He made My son Paul had no 1 119 Q. 2 A. 3 120 Q. 4 A. 5 121 Q. 6 A. 7 122 Q. 8 No. And none of your other children? No. Were they b e n e f i c i a r i e s under the Trust? Yes . As a b e n e f i c i a r y your son would have no authority to make t h i s order? 9 A. 10 123 Q. 11 He would have no authority. You w i l l find t h i s out for us, w i l l you, Mr. 0 ' Reilly-Hyland? 12 A. 13 124 Q. 14 A. 15 125 Q. I most c e r t a i n l y w i l l indeed. May I take th is ? Yes, indeed. Thank you. I am quite shocked by t h i s . Mr. 0 ' Reilly-Hyland, we u s u a ll y adjourn around about 16 t h i s time for a cup of c o f f e e or a cup of tea , so we 17 might do that for ten minutes. 18 19 20 (SHORT ADJOURNMENT) 21 22 126 Q. MR. JUSTICE COSTELLO: 23 We w i l l resume now, Mr. 0 ' Re illy-Hylan d. I 24 j u s t want to ask you a few questions about a company 25 to which you made some reference, that i s Malborough 26 Holdings Limited. 27 A. 28 127 Q. 29 A. Yes . That was the company that developed Fitzwilliam? That's r ig h t. 1 128 Q. 2 3 Am I not correct in saying that i t als o developed other property also? A. 4 No, I know that you must be thinking of Telephone House. 5 129 Q. 6 A. Yes. I t was another Malborough company and I can't 7 remember whether i t was Malborough Estates or 8 Malborough something, but that did develop that and 9 there were two people primarily involved in that; 10 myself and Liam McGonagle, my s o l i c i t o r . 11 about the middle 1960's . 12 as Malborough Holdings, I think i t i s c a l l e d , which 13 was a separate company was part of Fi tzw il lia m Lawn 14 Tennis Club and there was another one I think c a l l e d 15 Fi tzw il lia m Plaza. 16 in t h a t . 17 130 Q. 18 That was The company you r ef er to There was quite a few companies I j u s t want to know the development that you have referred to took place in the 1960's? 19 A. 20 131 Q. 21 That's r ig h t. Malborough Holdings in fa c t was a su bsidiary of Guinness Mahon Cayman Trust Limited, was i t not? 22 A. 23 132 Q. 24 No. Guinness Mahon Cayman Trust Limited owned shares in Malborough Holdings Limited? 25 A. 26 133 Q. Not that I know of. I thought i t was New Ireland. I f we look at page 98. (SAME HANDED). (Exhibit 12) 27 these are notes to the account of Guinness Mahon 28 Cayman Trust Limited and subsidiary companies, and 29 you w i l l see three investments held by a subsidiary 1 2 3 I don't think I have the ri ght page. 134 Q Page 98. Sorry, you have the wrong page, page 98. 4 (SAME HANDED). 5 subsidiary Malborough Holdings Limited of £120,000? 6 A 7 135 Q Do you see investments held by a I do. "The investment in Malborough Holdings Limited Company Incorporated (Ireland) represents 1 2 % of the equity of that company." 8 9 10 11 Did you not know that? 12 A 13 136 Q 14 15 Mr. Traynor was involved in Malborough Holdings, was he not? A 16 17 No, I thought i t was New Ireland. He was, but I thought he was wearing his New Ireland hat. 137 Q 18 Did that company carry out any further developments to your r e c o l l e c t i o n ? 19 A 20 138 Q Not to my r e c o l l e c t i o n . Very w e ll . I want to bring you back to a point that 21 we discussed before the break and that was the way 22 in which loans to you by Guinness & Mahon were 23 secured. 24 documents of Guinness & Mahon, pages 65, 66 and 67. 25 (SAME HANDED). 26 the Credit Committee of Guinness & Mahon in Dublin 27 in 1989. 28 security. 29 I want to r ef er you to c e r t a in in t er n al Do you see t h i s i s an ap p li c a ti o n to It r e f e r s to you and i t r e f e r s to the Do you see the three paragraphs numbered: "1) T i t l e deeds of 67 Nutley Avenue. 1 2) Shares in McDonagh Boland Ltd........... 2 3) Security i s adequate for £310,000." (Exhibit 13) 3 4 139 Q 5 A Yes, I do. May I point out, Judge, an error in items 1 and 2 of the same paragraph? 6 7 140 Q 8 A 9 Yes, what i s the error? I t was 67 Nutley Road and i t was sold for £430,000 and the shares in McDonagh & Boland were als o sold 10 11 Do you see that? for £430,000. 141 Q 12 Maybe what they were sold for i s d i f f e r e n t to the valuation that was placed? 13 A 14 142 Q This i s a valua tio n which they put upon i t . Very w e l l . This i s t h e i r valua ti on, the bank's to 15 the Credit Committee and the s e c u r i t y i s adequate 16 for £310,000. 17 i s the Minutes of the Credit Committee and t h i s i s a 18 d e c is i o n in r e l a t i o n to your loan. I f you turn over the page then, t h i s 19 "The Submit. 20 1) An explanation of Return on the c a p i t a l figu re i s required. 21 22 23 24 2) Further information on 67 Nutley Avenue r e q u i r e d . . . . 3) Is 3 the sum of 1 & 2 or i s t h i s 'adequately backed' to the extent of £310,000 in addition"? 25 26 They are an seeking explanation for the phrase 27 "adequately backed" and that i s given at no. 3 in 28 the preceding page and i f you look at the next 29 memorandum i t deals with t h i s (Exhibit 15). 1 "The s e c u r i t y held i s f i r s t l y the t i t l e deeds of the property in Nutley Avenue. The property i s held in T r u s t . . . . It does have a tenant but even so Dublin are f a i r l y sure that t h i s £150,000 i s a very conservative estimate of the value. There are the p r iv at e company shares with an estimated value o f . . . And t h i r d l y , "adequate security" valued at £310,000. Dublin are therefore looking at a t o t a l s e c u r i t y which they value at a minimum of £610,000." 2 3 4 5 6 7 8 Mr. 0 ' Reilly-Hyland, you did not know anything about 9 t h i s , but I ju s t want to in d ic a te to you what these 10 documents mean. 11 phrase "adequate security" as not j u s t the two 12 s e c u r i t i e s in no. 1 and no. 2 but something e l s e in 13 addition, £310, 000. 14 Mr. 0 ' Reilly-Hyland, from the evidence we have that 15 when the bank r e f e r s to loans being "adequately 16 secured" they mean secured by an Ansbacher de po si t. 17 I take i t you know nothing about th is ? 18 A. 19 143 Q. It means that the bank regard the I am suggesting to you, Absolutely nothing, Sir. Would you mind taking the statement you gave us 20 (Exhibit 16), Mr. 0 ' Reilly-Hyland, I would l i k e to 21 go through i t with you. 22 member of Lloyds and then you took advice from 23 Mr. C l i f f o r d Turner and approximately £100,000 was 24 paid int o a Trust fund in the Bahamas. 25 Mr. C l i f f o r d Turner? 26 A. 27 28 29 You say in 1963 you were a Who was They are now C l i f f o r d Chance, they are a law firm in London. 144 Q. So you were advised at t h i s stage by a law firm in London? 1 I would go further, Judge, i f I am not taking up too 2 much time. 3 because the whole t r i c k of jo in in g Lloyds was to be 4 able to chose your sy ndicates, so I was f r ie n d l y 5 with a man c a l l e d Bob Waldron, Waldron Scarman, that 6 would be Scarman Lesley L .J ., so I was dealing with 7 people of high reputation. 8 ' i f you want to, and you must do t h i s , have an 9 offshore Trust because there are no stop l o s s and It took me some years to j o i n Lloyds Bob Waldron said to me, 10 you and your family could end up bankrupt. 11 do what most people are doing and that i s have an 12 offshore Trust. 13 Turner' as they were then and C l i f f o r d Chance as 14 they now are. 15 i s now a very e l d e r l y man, the Honourable David 16 Nicholson, now Lord Carnock. 17 s e t up very n e at ly and very properly. 18 145 Q advis or s. 20 solicitors ? A 22 146 Q 23 24 I w i l l introduce you to C li ff o r d The man I de a lt with in doing t h i s , The whole thing was I j u s t want to ask you about your p r o fe s s io n a l 19 21 You must Your p r o f e s s io n a l advisors were English Yes . The Trust that was s et up in the Bahamas, have you a copy of that Trust Deed? A No, I gave a l l the information which I got from 25 C l i f f o r d Turner to Guinness & Mahon about 1966 or 26 1967 . 27 28 29 147 Q The question I am asking i s have you a copy of the Trust Deed? 1 148 Q 2 A 3 149 Q 4 5 Guinness & Mahon. Do you mean that you gave a copy of the Trust Deed to Guinness & Mahon? A No, I had an o r i g i n a l and a counterpart. The 6 o r i g i n a l , I think, was with the attorneys in the 7 Bahamas who were Trustees, whose name I have 8 forgotten, and my counterpart I gave with a large 9 f i l e to Guinness & Mahon. 10 150 Q 11 A 12 151 Q 13 A 14 15 When was that? I would guess l a t e 1960's, 1966 or 1967. When you moved your funds to Cayman, i s that i t ? About that time. I f I may explain why I did t h i s , Judge? 152 Q I w i l l come to that in a moment, 16 Mr. 0 ' Re illy-Hylan d. 17 d i s c r e ti o n a r y trust? 18 A Do you remember was i t a I don't r e a l l y know what a d i s c r e ti o n a r y t r u s t i s to 19 be frank. 20 and children being pursued by outside claims from 21 Lloyds. 22 153 Q It was a Trust to prevent myself, my wife I know the object of the Trust. You do not remember 23 whether i t was a d is c r e ti o n a r y t r u s t , whether the 24 Trustees had a d i s c r e t i o n or not as to how the funds 25 that were given to them were to be used? 26 A 27 154 Q 28 A 29 I understood the Trustees were a l l powerful. Do you remember signing a l e t t e r of wishes? I c e r t a i n l y remember wishes, the signin g of the l e t t e r I don't remember, but I do remember being 1 asked wishes. 2 probably did. 3 155 Q. Whether I wrote them or signed i t , Were you advised that i f a d i s c r e ti o n a r y t r u s t i s 4 s e t up, that the s e t t l o r may write a l e t t e r of 5 wishes to the Trustees? 6 A. 7 156 Q. I I do remember something about wishes, yes, I do. Whatever form of Trust that was e s t a b l i s h e d in the 8 Bahamas took, you were able to organise that i t was 9 wound up and that the funds were tr ans fe rre d to 10 11 Cayman? A. 12 I di d n 't do tha t, Guinness & Mahon arranged the whole thing. 13 157 Q. 14 A. 15 158 Q. 16 A. 17 159 Q. But they did i t ? They did i t . Presumably they did i t in a p e r f e c t l y l e g a l way? I have no doubt about tha t. In r e l a t i o n to tha t, when you decided to move the 18 funds and take up the suggestion that you would move 19 to the Cayman Islands, did you have any p r o fe s s io n a l 20 advice here in Ireland? 21 Mr. McGonagle or anyone? 22 A. 23 160 Q. 24 A. 25 161 Q. Did you have your s o l i c i t o r No. Did you have any tax consultant advising you? No. Just on that t o p ic , dealing now with the end of the 26 1960's and e ar ly 1970's, was Mr. McGonagle your 27 s o l i c i t o r then? 28 A. 29 162 Q. He was. Did he remain so then up to h is death? 1 2 163 Q 3 Did you have an accountant looking a f t e r your tax affairs ? 4 A 5 164 Q 6 A I did. Who were they? In 1948 I made my f i r s t return through D.J. Kennedy 7 & Company who subsequently became Kennedy Buckley 8 back then, who subsequently became Butler Chance, 9 who subsequently became D e l o i t t e & Touche. 10 165 Q 11 A 12 16 6 Q They have been your accountants a l l the time? A ll the time, for over 50 years. In r e l a t i o n to the arrangements that were made with 13 Guinness & Mahon and the Cayman Island Trust, you 14 did not consult them at a l l ? 15 A 16 167 Q No. I have drawn your a t t e n t i o n to the fa c t that you had 17 signed t h i s guarantee with a number of persons, one 18 of whom was Desmond Traynor in 1970, so you must 19 have known Mr. Traynor in 1970 (Exhibit 4)? 20 A 21 168 Q 22 A Yes, I did. How long would you have known him for? Obviously 1970. I met him very b r i e f l y in Haughey 23 Boland. 24 Boland, which I did, and I met him in a very 25 perfunctory way. 26 were not my personal accountants. 27 169 Q 28 A 29 170 Q It was p o l i t i c to give some work to Haughey It was a very small account. That i s how you met him f i r s t ? Yes . They 1 No, I think in Haughey Boland I would guess about 2 1968 . 3 171 Q 4 5 Did you d is cu ss with Mr. Traynor the movement of funds to the Cayman Islands? A I thought i t was John Guinness and an English man 6 because I think i t was done by the London o f f i c e , I 7 th i n k . 8 172 Q 9 u n t i l 1971. 10 A 11 173 Q 12 13 Guinness Mahon Cayman Trust was not incorporated Then i t must have been 1971 perhaps. Guinness Mahon Cayman Trust, the Trustees of the Trust . A I w i l l t e l l you why I think i t was the l a t e 1960's . 14 I found having t h i s Trust in the Bahamas expensive 15 because i t di d n' t generate enough income to pay the 16 Trustees s e c r e t a r i a l fe e s and I would have thought 17 i t sooner, but obviously i f i t was not incorporated 18 u n t i l 1971, then i t must have been th at . 19 174 Q 20 the Trust was Guinness Mahon Cayman Trust Company? 21 A 22 175 Q 23 24 I thought the Trustee was Guinness Mahon, Dublin. Do you remember signing a l e t t e r of wishes in r e l a t i o n to t h i s document? A 25 26 Do I understand your evidence that the Trustee of No. I f I signed one, the only wishes I can r e c a l l were the o r i g i n a l s ones. 176 Q You do not remember signing a l e t t e r of wishes in 27 r e l a t i o n to t h i s one? 28 I don 't. 29 that I did. I may have, but I think i t i s u n li k e ly 1 177 Q. 2 A. Where i s t h i s document, where i s the deed? The o r i g i n a l deed which has served throughout was 3 the one given to Guinness & Mahon in what I thought 4 was the l a t e 1960's. 5 178 Q. 6 A. 7 179 Q. 8 A. 9 180 Q. 10 A. 11 Where i s i t now? I assume in Guinness & Mahon. Did you ever get a copy of i t ? No. Did you ever see i t ? I think I saw i t at some stage because I think I signed i t as a s e t t l o r . 12 181 Q. 13 A. 14 182 Q. 15 A. 16 183 Q. 17 A. 18 184 Q. I wonder did you? I am making an assumption, Judge. Yes, you are. I assume I signed i t . You do not remember, do you? Not s p e c i f i c a l l y , no. Why I say t h i s , why I question you on i t , 19 Mr. 0 ' Reilly-Hyland i s that we have had evidence to 20 in d ic a t e that Trusts were e s t a b l i s h e d by Guinness & 21 Mahon, by r e s id e n t s in Ireland, but they were not 22 signed by the person who was supplying the funds, 23 but by somebody e l s e as s e t t l o r and t h i s could have 24 happened in your case? 25 A. I thought the o r i g i n a l one they took as h o l i s b o l i s 26 from the Bahamas to Guinness & Mahon and I thought 27 i t was one Trust Deed which did for the l o t . 28 29 185 Q. Are you saying to me that you have no r e c o l l e c t i o n 1 2 186 Q. 3 A moment ago you said that the o r i g i n a l deed was with Guinness & Mahon? 4 A. 5 187 Q. 6 Yes. Is t h i s the one that was s e t up by the English solicitors ? 7 A. 8 188 Q. 9 A. That's r ig h t. Do you think you signed no second deed? I may have, but I don't r e c o l l e c t i t . I have a 10 r e c o l l e c t i o n , Judge, about t h i s which occurred to me 11 a f t e r I had been at the Moriarty Tribunal and i t i s 12 t h i s ; the Minister of Industry was a man c a l l e d 13 George Colley and he got int o a l i t t l e of bother 14 t r yi ng to bring the Pf iz e r business to Ireland and I 15 was rather fr i e n d l y with somebody in J.P. Morgans 16 and I was of some help to him there. 17 the plane I was di s c u s si n g t h i s Trust Fund bearing 18 in mind that he was a s o l i c i t o r before he became a 19 Minister, and I said to him, 20 to disc uss t h i s with somebody in Ireland' and he 21 said to me, 'do you know Gerald Sweetman' and I said 22 yes. 23 about i t , ' but I never did. 24 189 Q. 25 A. He said, Coming back on 'you know, I may want 'w e ll, why don't you t a l k to him What was the relevance of tha t, Mr. 0 ' Reilly-Hyland? The relevance i s that i t had crossed my mind that 26 maybe I should have had an I r i s h lawyer but then I 27 was persuaded that i t was not necessary. 28 29 190 Q. Who persuaded you? 1 2 191 Q 3 A 4 192 Q Who in Guinness & Mahon? 5 A I t could have been John. 6 193 Q 7 A 8 Who persuaded you i t was not necessary to do so? Guinness & Mahon. Who? I t could have been John Guinness, but I am not saying i t d e f i n i t e l y was. 9 194 Q 10 A Could i t have been Mr. Traynor? I j u s t don't r e c a l l because my p r in c ip a l contact 11 before Traynor was John Guinness. 12 Guinness I wouldn't have been in Guinness & Mahon. 13 I t could have been Traynor. 14 195 Q Without John You cannot a s s i s t then in r e l a t i o n to whether or not 15 a new Trust Deed was executed. 16 correspondence r e l a t i n g to the establishment of the 17 Trust? 18 A 19 196 Q 20 A 21 197 Q 22 Have you any No. Did you ever have any correspondence? No. Would you ju s t look at the fourth paragraph of your statement (Exhibit 16) at the l a s t sentence: 23 "A s h e l f company was a l l o c a t e d to me to use, Newport Agencies Overseas Limited." 24 25 26 27 28 29 Would you t e l l me about that? A They said to me. . . (INTERJECTION). Who did? 1 199 Q 2 A Probably Traynor said that my Trust company in the 3 Bahamas would be absorbed int o t h e i r one. 4 Agencies Overseas, which was owned by Guinness & 5 Mahon, i t was not owned by me. 6 200 Q 7 A 8 Newport You describe i t as "a s h e l f company." Well, that i s n ' t my actual choice of words, i t should be a company. 9 201 Q 10 A Whose choice of words i s i t ? I think, Gerry, was i t somebody in the o f f i c e who 11 used the word "shelf" there. 12 did, I think i t i s a company. 13 202 Q 14 A 15 203 Q 16 A It i s u n l i k e l y that I This i s your statement (Exhibit 16). It is . Is t h i s wrong? I would presume that since I di d n' t incorporate the 17 company and I don't know who did, and i t i s a 18 curious name, so i t i s reasonable to assume i t was a 19 shelf. 20 204 Q 21 A 22 What has that to do? I f i t had been my company I would not have used the word "Newport Agencies Overseas." 23 205 Q 24 A 25 26 A lr ig h t. What was Newport Agencies Overseas Limited to do? I t was to take over t h i s Trust, that was i t s l e g a l identity. 206 Q 27 "A s h e l f company was a l l o c a t e d to me to use." were you to use i t ? 28 A 29 207 Q The answer i s I di d n' t use i t . How were you meant to use i t ? 39 This i s in your How 1 2 I wasn't meant to use i t , i t was an i d e n t i f i c a t i o n 3 for Guinness & Mahon as to what funds they were 4 putti ng int o t h e i r subsidiary, Guinness Mahon Cayman 5 and to i d e n t i f y i t as a Trust, they used a Trust 6 company. 7 208 Q Now we have two companies; we have the subsidiary of 8 the Dublin company, Guinness Mahon Cayman Trust 9 Limited and we have another company c a l l e d Newport 10 Agencies Overseas Limited. 11 of the Trust company? 12 A 13 209 Q 14 Was t h i s to be the name That i s so. Did you ever have any correspondence with Newport Agencies Overseas Limited? 15 A 16 210 Q No. Did you ever rec e iv e any accounts from e i t h e r 17 Guinness Mahon Cayman Trust Limited or Newport 18 Agencies Overseas Limited? 19 A 20 211 Q 21 A 22 212 Q 23 A 24 When was that? I would say about 1983 or 1984. Where are they now? I sent them back to Desmond Traynor because they bore no r e l a t i o n s h i p to my a f f a i r s . 25 213 Q 26 A 27 214 Q 28 29 Yes, once. When did you do th is ? Probably within a month or two of r e c e iv in g them. So you got accounts once and you disagreed with them, i s that i t ? A 1 215 Q. 2 A. 3 216 Q. 4 A. Did you t e l l Mr. Traynor that? I did. Was the matter put right? He said something l i k e , 'Furze had got i t a l l wrong 5 and, you know, i t i s a very simple thing, I w i l l 6 give you what the balances a r e .' 7 217 Q. 8 A. 9 218 Q. Did he? 10 A. He did. 11 219 Q. 12 A. 13 14 He said, 'I w i l l give you what the balances a r e .' Where are they? He gave i t to me on a pie c e of paper I have long since destroyed or l o s t . 220 Q. 15 16 I beg your pardon? Was that the only time that you got i t from Cayman Islan ds, an account from Cayman Islands? A. 17 No, t h i s was given to me in Dublin from 17 College Green by Mr. Traynor. 18 221 Q. 19 A. 20 222 Q. By? Mr. Traynor. Is that an account in the name of Newport Agencies 21 Overseas Limited or in the same of Guinness Mahon 22 Cayman Trust? 23 A. 24 I think the account, Judge, said what the balances were, 25 223 Q. 26 A. 27 224 Q. 28 A. 29 225 Q. How was the account i d e n t i f i e d ? 'the balances in Cayman are X.' I t was not headed in any way? No, i t wasn' t . You disputed th is ? Yes. Did you know that the funds in the Cayman Islands 1 2 3 Yes . 226 Q 4 A 6 227 Q 7 I assumed so, yes. For a l l those years your funds or the funds of the Trust were on deposit? 8 A 9 228 Q 10 A 11 229 Q 12 I think so. They were never inves ted in any way? No. You never discusse d t h i s or you never suggested they should be in ves ted in any way? A 14 15 You knew i t was in the bank? 5 13 In the Guinness Mahon Cayman Trust Bank? I was under the impression that I had no authority to disc uss i t . 230 Q You say in your statement that Mr. Guinness had said 16 to you that he had an e x c e l l e n t investment team and 17 would well advise the tr a n s fe r of funds. 18 have been a very good investment team but they were 19 not in v e s t i n g your money in any way other than 20 l ea vin g i t on de po si t. 21 A 22 231 Q 23 A They might That i s what happened afterwards, yes. You accepted tha t, you did not...(INTERJECTION)? I di d n 't know much about t h i s u n t i l three years 24 a f t e r I l e f t the Central Bank. 25 not to i n t e r f e r e with any banking operation 26 whatsoever. 27 232 Q 28 29 Three years a f t e r you l e f t the Central Bank, when was that? A I was very ca reful 1 233 Q 2 You then discovered that the money was on deposit a l l the time? 3 A 4 234 Q 5 A 6 235 Q Certainly some of the time. Not inve st ed, that was the way i t was a l l the time? That i s what I think, yes. I f that i s so, then the inducement to change from 7 the Bahamas to the Cayman Islands was not r e a l i s e d , 8 you were not g e t t i n g a b e t t e r return on your 9 investment, on the Trust funds? 10 A 11 No, that i s not co rrect, Judge, because to keep the money in the Bahamas was co st in g me money. 12 236 Q 13 A I see . I was t o l d by Guinness & Mahon one of the 14 a t t r a c t i o n s , and they s e t up a l l t h i s for me, was 15 there would be no charge or i t would be absorbed by 16 the income over a period of years. 17 a t t r a c t i o n was. 18 237 Q 19 That i s what the You say in your statement that i t was an "ex celle nt investment team." 20 A 21 238 Q That i s what John Guinness said i t was. Just return to the question of the accounts, i f you 22 only got t h i s one statement then in 1986 in Dublin 23 from Mr. Traynor which you understand came from the 24 Cayman, subsequently to that did you ever obtain any 25 accounts from Mr. Traynor? 26 A No, but I got balances from him o c c a s i o n a l l y 27 ve rb al ly . 28 So for a l l these years then from 1971 or whenever i t 29 was t h i s Trust was e s t a b li s h e d in Cayman u n t i l 1994, 1 you never got any statement of account other than 2 once? 3 That's r ig h t. 4 240 Q 5 A 6 241 Q 7 A 8 242 Q 9 A 10 243 Q 11 A 12 In writing? That's r ig h t. How did you know how much was there? He would e i t h e r telephone me or send me a memo. What does sending you a memo mean? I t means 'cash, X pounds.' That i s i t . How often did that come? I t di d n' t say 'Dear Mr. 0 ' R e i l l y - H y l a n d ,' he tended to give them to me when I met him. 13 244 Q 14 A 15 245 Q 16 A 17 246 Q 18 A How often did i t happen that you got a memo? No more than once a year. More than once a year? No more than once a year. Where would you meet him, Mr. 0 ' Reilly-Hyland? I have met him in Guinness & Mahon Bank. Very 19 frequently he said, 20 that i s where you normally have your lunch each day, 21 so I w i l l see you over c o f f e e . ' 22 247 Q 23 A 24 248 Q 25 Did you ever go to Fi tz w il lia m Square? I did, I went twice. So once a year or so you would get a statement or a memo? 26 A 27 249 Q 28 29 'I am having lunch in Jurys, Yes . You never got anything in the nature of bank statements, did you? A 1 When the tr a n s fe r took place , the funds that were in 2 the Bahamas Trust were tra ns ferre d to the Cayman 3 Islands bank were on deposit in the Cayman Islands 4 bank? 5 A 6 251 Q Yes . I t appears from your statement that you paid a sum 7 of approximately £100,000 int o the Trust Fund 8 o r i g i n a l l y in 1964? 9 A 10 252 Q 11 A 12 253 Q No. Paragraph 3. That was £100,000 I paid in. I t appears in the documents that I have been 13 r ef er ri n g you to that the Trust Fund was a great 14 deal more than that in the subsequent years? 15 A I t was and my understanding of i t was that the 16 Trustees had pumped up the seed c a p i t a l , the ba si c 17 settlement at £350,000 and that the lodgments which 18 they received from me which was my s t e r l i n g income 19 with United Kingdom tax deducted at source, was 20 added to that by way of loan. 21 that loan f i n a l , I am t o ld , ju s t by a donation. 22 254 Q 23 I am not foll owing you at a l l , could you take t h i s slowly. 24 A 25 255 Q I could have made The o r i g i n a l Trust was £100,000 in 1964? Yes . I am poi nting out to you that the Trust funds which 26 were on deposit in the Cayman were much more than 27 that? 28 A 29 256 Q Yes . I want to know how that came about. 1 2 257 Q 3 4 No, I do not. I ju s t want very b r i e f l y did you tr a n s fe r funds to the Cayman? A Oh yes. Well, not to the Caymans, I gave them to 5 Guinness & Mahon in Dublin and they were s t e r l i n g 6 funds. 7 258 Q 8 So you tra nsf err ed s t e r l i n g funds to Guinness & Mahon in Dublin? 9 A 10 259 Q Yes . You t o l d me that you had an account, a current 11 account in Dublin, i t di d n' t go in t o t h i s current 12 account? 13 A 14 260 Q 15 A 16 261 Q 17 No. They went in t o , you thought, a s t e r l i n g account? That i s what I think. The funds then that you gave Guinness & Mahon were funds from English sources? 18 A 19 262 Q 20 That's r ig h t. You understood that these were to be part of the Trust Funds? 21 A 22 263 Q Yes . You know now that the funds that you gave to 23 Guinness & Mahon in Dublin in fa c t end ended up in 24 the Cayman Islands, on deposit in the Cayman 25 Islands? 26 A 27 264 Q 28 A 29 Yes . Did you know then? I did. I knew that the s t e r l i n g money I gave them was to be kept in s t e r l i n g and i t was to be added to 1 2 265 Q 3 A 4 2 66 Q 5 A 6 267 Q 7 A 8 268 Q 9 So they were going to tr a n s fe r i t ? They were going to? They were going to tr a n s fe r i t ? Yes . Do you remember Mr. Traynor's death in May 1994? I do. Had you terminated your r e l a t i o n s h i p with Guinness & Mahon before h is death? 10 A 11 269 Q 12 A 13 270 Q 14 A I terminated the Trust before his death. Did you? I did. How did you do that? I went to see him at Fi tz w il lia m Square and I said, 15 'now, I want these funds. 16 needed for i s the winding up of Lloyds, the winding 17 up of Lloyds' ba la n c e s .' 18 monies for paying o f f Lloyds. 19 271 Q 20 A 22 272 Q 23 You have already referred to the fa c t that in 1991 Yes . I t had gone to your son and your son had given i t to you and you paid Lloyds? 24 A 25 273 Q 26 A 27 29 I owe banks considerable you had got money from the Trust? 21 28 What they are v i t a l l y That's r ig h t. Did you s t i l l owe further sums to Lloyds? I owed them to banks who had supported me in Lloyds and I think to Lloyds i t s e l f . 274 Q You had debts to banks, i s t h i s what you are t e l l i n g me? 1 2 275 Q. 3 A. You required funds for t h i s purpose? Yes, and there was al s o , Judge, the f e e l i n g of 4 d i s s a t i s f a c t i o n with the way t h i s Trust was being 5 run. 6 276 Q. 7 8 The winding up of the Trust, how was that e f f e c t e d or how was that done? A. 9 I don't know what the machinery was, but I said, want an end to a l l t h i s . 'I You have paid out the 10 £350,000 or part of the o r i g i n a l c a p i t a l you say 11 should be c a p i t a l d i s t r i b u t i o n to my son Paul and 12 the remaining balance I want paid back to Guinness & 13 Mahon in D u b li n .' 14 277 Q. going to get them? 15 16 A. 17 18 I f you were not giv in g them the Trust funds, who was I gave them to Guinness & Mahon and then I paid Lloyds o f f and the other banks. 278 Q. 19 So with the funds you got they were deposited in your account in Guinness & Mahon? 20 A. 21 279 Q. That's r ig h t. You then trans fe rre d from your current account in 22 Guinness & Mahon the funds to pay o f f the debts you 23 owed in London? 24 A. 25 280 Q. 26 A. 27 281 Q. 28 A. 29 282 Q. That's r ig h t. When did that happen? I reckon some time at the end of March 1994. The end of March 1994? I would think so. What sums are we ta lk in g about? 1 2 283 Q. I was asking you e a r l i e r about t h i s sum of £161,000 3 that was paid on the order of your son by Mr. Furze 4 and you said you could remember nothing about i t . 5 A. 6 284 Q. 7 8 That had nothing to do with the payment to you of funds that were in the Trust which you then used? A. 9 10 Nothing about i t . No, i t i s in excess of what I s t a t e d . I w i l l have to check the bank statements now. 285 Q. 11 The bank statements should show the tr a n s fe r to you of the funds from Cayman? 12 A. 13 286 Q. 14 That's r ig h t. Which you had then transfe rre d on, but in addition t h i s figu re of £161,000? 15 A. 16 287 Q. 17 A. 18 288 Q. 19 A. 20 289 Q. That's r ig h t. The date being March? Yes. The same time? Yes. Very w e ll, you can send those on to us, 21 Mr. 0 ' Reilly-Hyland, when you have found them. 22 Perhaps you would t e l l me why you say you were 23 d i s s a t i s f i e d with the way in which the Trust was 24 being managed? 25 290 Q. I had spoken to other people who had t r u s t funds in 26 London, there were tr u s t meetings and my other 27 co lle agu es would meet with the t r u s t e e s . 28 ju s t a question of a chap standing outside Jurys and 29 saying, I t wasn't 'you w i l l know t h i s , £312 in th at' and 1 2 3 paragraph (Exhibit 1) on the f i r s t page: 4 "In the course of . . . Mr. Traynor I expressed a wish that the Trust be wound up and that the Trustees would make a d i s t r i b u t i o n to the b e n e f i c i a r i e s . This, I b e l i e v e , occurred s h o r tl y afterwards." 5 6 7 8 The d i s t r i b u t i o n was made to you? 9 A 10 292 Q 11 A 12 Yes . Nobody e ls e ? No, nobody e l s e . My son Paul and myself were the only b e n e f i c i a r i e s . 13 293 Q 14 A 15 294 Q He did not get i t , you got i t ? He got the Stg£350,000 which he passed back to me. When you t o l d Mr. Traynor then in March, sh or tly 16 before he died that you wanted to wind t h i s up, 17 there was no problem at a l l in his arranging that 18 the funds would be put int o your account in Guinness 19 & Mahon? 20 A 21 295 Q 22 A 23 296 Q He seemed r elu ct a nt to put i t int o Guinness & Mahon. You asked him to do i t and he did i t ? Yes, he did. When you say that your son Paul was the only 24 b e n e f ic ia r y , i s that right? 25 children not b e n e f i c i a r i e s of the Trust? 26 A 27 Well, they were, but he was keen to have i t paid to any one c h i l d . 28 297 Q 29 A Were your other Who was keen? He did n't want to s p l i t i t up. 1 298 Q 2 A 3 4 Yes, he said, ' l e t ' s pay i t to one c h i l d and that i s it.' 299 Q 5 The other b e n e f i c i a r i e s in the Trust then were your daughter and your other son? 6 A 7 300 Q 8 A 9 301 Q 10 A That's r ig h t . They got nothing out of the Trust? Nothing. On Mr. Traynor's suggestion? Well, i t i s not quite that simple because I did pay 11 my sons Lloyds l i a b i l i t y with what might have been 12 his share. 13 302 Q 14 A 15 Sorry? I did pay my son Kenneth's Lloyds l i a b i l i t y with t h i s money. 16 303 Q 17 A 18 304 Q 19 A 20 305 Q With which money? The money from Traynor to Paul. This i s Stg£350,000? Yes . This was a sum, as I understood i t , that came to you 21 and you paid your debts. 22 you al s o paid debts of your son Kenneth? 23 A 24 Kenneth, my wife and my daughter, I paid a l l those debts. 25 306 Q 26 A 27 307 Q 28 29 Are you t e l l i n g me that With the £350,000? No, a great deal more. I am ju s t asking about the b e n e f i c i a r i e s of the Trust? A They a l l got looked a f t e r in as much as the family 51 1 2 You have to be a b i t more accurate than that, 3 Mr. 0 ' Re illy-Hylan d. 4 in the way you have described. 5 the Trust in March 1990 and i t was your debts that 6 were paid with the funds. 7 a l l the other b e n e f i c i a r i e s named in the o r i g i n a l 8 Trust Deed, did they obtain no sum at a l l when i t 9 was wound up? 10 A 11 309 Q 12 Some of the £350,000 was paid You then wound up I am j u s t asking you were No sum at a l l . When you took the de c is i o n in March 1994, did you take any l e g a l advice on th is ? 13 A 14 310 Q 15 A 16 311 Q 17 No. Did you consult with your tax advisors? No. Have you any correspondence at a l l in r e l a t i o n to t h i s sum in the Cayman Islands? 18 A 19 312 Q 20 A No. Did you ever have any? No. I may have had some memos some years pre viou sly 21 from Traynor, but when I r e t i r e d at 65, which i s ten 22 years ago, I was planning to move o f f i c e in the l a t e 23 1980's, a great deal of s t u f f was b lu n t l y destroyed, 24 old bank statements from Provincial Bank, 25 AIB.. . (INTERJECTION). 26 313 Q 27 A 28 314 Q 29 A Sorry? Old bank statements. You destroyed documents? 1 315 Q 2 A 3 316 Q 4 About 1988. Would you have destroyed any documents that you had then in r e l a t i o n to the funds in Cayman Islands? 5 A 6 317 Q Po s s ib le , quite p o s s i b l e . Since 1988 you would have got o c c a s i o n a l l y , once a 7 year or so, a memo from Mr. Traynor. 8 those or did you destroy those? 9 A Did you keep I did keep them, and t h i s sounds extraordinary, I 10 put them in my b o i l e r house with another tea chest 11 and they got soaked in o i l . 12 the time as very important. 13 318 Q 14 I di d n' t regard them at Are you saying that you had records, that you kept some records and these have been destroyed? 15 A 16 319 Q Yes, unw itt in gly by the way. Mr. 0 ' Reilly-Hyland, the funds or the money that was 17 had been trans fe rre d to Cayman was on deposit in the 18 bank in Cayman and was earning i n t e r e s t . 19 return that i n t e r e s t for tax purposes here in 20 Ireland? 21 A Did you Well, I never got any money from Cayman by way of 22 income, but I was supposed to get an o f f s e t of bank 23 i n t e r e s t in Dublin and I think I did. 24 320 Q 25 26 27 28 29 Is the answer to my question no, that you did not r e t u r n . . . (INTERJECTION)? A No, I di d n 't . MR. JUSTICE COSTELLO: Mr. 0 ' Reilly-Hyland, that i s a l l I wish to ask you. Ms. Mackey would ju s t l i k e to ask you a few 1 2 3 poin ts that were not 4 t o t a l l y c le a r to me, Mr. 0 ' Re illy-H ylan d. 5 mentioned that a f t e r the Trust moved from the 6 Bahamas to Cayman, you made some further t r a n s fe r s 7 by tr a n s fe rr in g money to Guinness & Mahon. 8 you do that? 9 A 10 You How did I wrote to Guinness & Mahon en cl os in g my Lloyds cheques. 11 322 Q 12 A Who did you write to in Guinness & Mahon? I suppose in the e ar ly days John Guinness and in the 13 l a t t e r days or the middle days or the l e s s early 14 days Desmond Traynor. 15 323 Q 16 So you would a c t u a l l y send the cheques to Mr. Guinness or to Mr. Traynor? 17 A 18 324 Q 19 Yes . Did you ever give Mr. Traynor any cheques on the occasions when you met him to get statements? 20 A 21 325 Q No. There was one other matter I was wondering about; 22 when you were t a lk in g about the fa c t that the 23 Trustees in Cayman did not make any investments on 24 your behalf, you said that you f e l t you had no 25 aut hority to d is cu ss t h i s matter. 26 A That's r ig h t . 27 Then in 1994 you went to Mr. Traynor and you said 28 you wished the Trust to be wound up and the money to 29 be used for what i t was o r i g i n a l l y intended that i t 1 2 3 Yes . 327 Q 4 5 Had something changed in the meantime that made you f e e l you could disc us s i t then? A F i r s t of a l l , we were facing t h i s very large Lloyds 6 loss. 7 people. 8 money to meet these debts. 9 328 Q The children were grown up, they were adult I needed and a l l my family needed t h i s You al s o mention in your statement (Exhibit 1) that 10 at the time you wished to wind up the Trust you were 11 surprised that the balance was lower than you 12 expected i t to be. 13 A 14 329 Q 15 Yes . On that occasion Mr. Traynor t o l d you what the balance was? 16 A 17 330 Q Yes . Do I understand from the surprise that you expressed 18 there that on the previous occasion when you had 19 receiv ed a balance from him, i t had been higher and 20 you had made no tr an sa ctio ns in the meantime? 21 A That was my understanding, but that might a l l be 22 answered by what I have been shown t h i s morning for 23 the f i r s t time. 24 331 Q 25 A 26 27 That might be the answer. Are you r e f e r r i n g to the document from Mr. Furze? From Ansbacher in which, according to them, my son Paul authorised a c lo s i n g payment of £161,000. 332 Q I t i s marked page 38 at the bottom ri gh t hand 28 corner, £161,376.29 (Exhibit 11)? 29 Yes, that might well be the sum which I thought I 55 1 2 333 Q. What I am r e a l l y wondering, Mr. 0 ' Reilly-Hyland, i s 3 how you knew that you were short? 4 expect that there would be t h i s extra sum of 5 £200, 000? 6 A. What le d you to I had a note from him the previous year which I gave 7 to Traynor and my r e c o l l e c t i o n i s that there should 8 have been nearer to £400,000, not £260,000. 9 334 Q. 10 You gave t h i s note to him at the occasion of t h i s meeting? 11 A. 12 335 Q. 13 A. I did, yes. Did he o f f e r you any explanation for t h i s s h o r t f a l l ? He said, 'you know there i s something wrong here and 14 you must have got i t wrong.' 15 about t h i s one. 16 St ates myself t h i s summer' and he said, 17 go down and I w i l l i n v e s t i g a t e t h i s with F u r z e . ' 18 336 Q. 19 A. 20 337 Q. 21 I said, He was quite upset 'w e ll, I am going to the 'no, I w i l l Did anything come of that? Nothing u n t i l t h i s morning. Until t h i s morning. You never heard again from - ­ w e ll , Mr. Traynor died of course. 22 A. 23 338 Q. 24 No, he died. You say you had a note which you showed him on that occasion? 25 A. 26 339 Q. 27 And gave to him. Was that the note he had given you of the previous year? 28 A. 29 340 Q. No. This was your own note? 1 2 341 Q 3 A I t was a note of what? Of a lodgment you had made? I t was a note of the l a s t balance and what previous 4 cheques I had sent from London and there were small 5 cheques because I was r e t i r e d then. 6 342 Q Just to understand e x a c t ly what t h i s was. This was 7 a note you had made of the l a s t balance you had 8 receiv ed from Mr. Traynor, i s that right? 9 A 10 343 Q The l a s t balance, yes. So you had noted down the balance as Mr. Traynor had 11 given i t to you plus some small cheques that you had 12 lodged in the meantime? 13 A 14 344 Q Those small cheques would have amounted in t o t a l to about £200, 000? 15 16 Yes . A No. I am ju s t tr yin g to put my mind back on t h i s 17 one, the balance according to him opening and 18 c l o s i n g was £240,000 something. 19 345 Q 20 A 21 22 On t h i s occasion? Yes, t h i s i s in March 1994 and I thought that the balance should be nearer £400,000. 346 Q What I r e a l l y want to find out i s why you thought i t 23 should be so much higher. 24 given you on the previous occasion 25 . . . (INTERJECTION)? 26 A The balance that he had The answer i s I cannot r e c o l l e c t why I thought i t , 27 but I did think i t . 28 Would i t have been because you b e li e v e d you had made 29 s u f f i c i e n t lodgments in the meantime to bring i t up 1 2 3 I j u s t don't know. 348 Q Were you aware, Mr. 0 ' Reilly-Hyland, that your Trust 4 or the account that you held in Guinness & Mahon 5 r e l a t i n g to the Trust in the Ansbacher account was 6 coded A/D and A/Dl? 7 A 8 349 Q 9 A 10 350 Q No. You are not fa m ili ar with that? No. Could I ask you to look at a document, page 25 11 (Exhibit 17). 12 by Ru Leonard, now deceased, an o f f i c i a l of Guinness 13 & Mahon who in the early 1970's looked a f t e r the 14 Ansbacher accounts or the Guinness Mahon Cayman 15 Trust accounts as they were then and he has sent 16 t h i s t e l e x to Mike Shield who was an o f f i c i a l in 17 Ansbacher in Cayman, in Guinness Mahon Cayman Trust. 18 This i s dated 19th May 1977 and, as you see, i t 19 says : (SAME HANDED). This i s a t e l e x sent 20 "URGENT 21 Ben efici ary of Newport Agencies i s meeting with J . D . T . . . " 22 23 24 25 26 27 28 29 Who i s John Desmond Traynor. " . . . tomorrow and d e t a i l s of a l l accounts from 1st October 1976 to date required. I can provide Dublin account A/D and London A/Dl, but require movements on current account maintained by you together with any other accounts you may have." 1 2 3 My family was. 351 Q 4 Newport Agencies i s your t r u s t company, as you explained to us? 5 A 6 352 Q That i s corr ect . So i f your family then i s the b e n e f i c i a r y of Newport 7 Agencies, was i t a member of your family that 8 Mr. Traynor was to meet with? 9 A 10 353 Q 11 A 12 354 Q No, i t would have been me. I t would have been you? Yes . Mr. Traynor was meeting with you in May 1977 and he 13 was going to provide you with the accounts of 14 Newport Agencies from October 197 6 to date, do you 15 r e c o l l e c t g e t t i n g those? 16 A 17 355 Q No. I may have, i t i s 23 years ago. I am ju s t bearing in mind that you t o l d us the only 18 account of Newport Agencies you got were in the 19 1980 ' s? 20 A That was the actual wr itten accounts. I might have 21 met Traynor and he said to me, 'by the way, the 22 fi gu res are so and so and so and s o . ' 23 24 25 356 Q I t goes on: "I can provide Dublin account A/D and London A/Dl, but I require current accounts maintained by you." 26 27 So t h i s appears to in d ic a te that Newport Agencies 28 had an account in Dublin coded A/D and one in 29 London, which would be Guinness & Mahon London, 1 coded A/Dl as well as a current account in Cayman 2 itself. 3 That conveys nothing to me. 4 357 Q 5 6 Can you throw any l i g h t on those accounts? You cannot r e c o l l e c t the p a r ti c u l a r meeting that they are t a lk in g about there with Mr. Traynor? A 7 No. MS. MACKEY: Very good. 8 further questions, 9 10 I have no Mr. 0 ' Re illy-Hylan d. 358 Q Thank you. MR. JUSTICE COSTELLO: 11 Just to c l a r i f y one matter in answer to a question of 12 Ms. Mackey's which you gave. 13 memo (Exhibit 11 )from Mr. Furze in which he r e f e r s 14 to the tr a n s fe r of £161,376 to the order of your 15 son. 16 some l i g h t on the question as far as you are 17 concerned? 18 A 19 359 Q 20 A 21 You seem to in d ic a te that that has now thrown Yes . What do you think t h i s means? I say in my statement (Exhibit 1) that I think I am £200,000 short in balance. 22 360 Q 23 A 24 25 I f you go back to t h i s Yes . I f what I say i s co rrect, i t would suggest that t h i s £161,000 balance i s what I am saying I am short. 361 Q 26 What follows from that and how are you short? has been trans fe rre d to you? 27 A 28 362 Q 29 A Yes . How are you short, Mr. 0 ' Reilly-Hyland? This 1 £240,000, but I thought i t should be nearer to 2 £400,000. 3 we are f a i r l y near to i t . 4 So what you are saying i s that you were probably 5 mistaken then in the figure that you gave to 6 Mr. Traynor because there had been trans fe rre d out 7 of the fund t h i s figure that i s mentioned in th is ? 8 A 9 10 No, Judge, I am not mistaken, Mr. Traynor was mistaken. 364 Q 11 12 I f we add the £161,000 to the £240,000, I am not foll owing how t h i s c l a r i f i e s for you what the p o s i t i o n i s . A 13 Why does i t c l a r i f y i t for you? I say I am £200,000 short and now out of the blue I see t h i s £161,000. 14 365 Q 15 A Yes . So that would marry up a great deal of what my 16 thought i s . 17 thought i t should be nearer to £400,000, and now I 18 see £161,000 has been trans fer re d. 19 3 66 Q I got the £240,000 something and I When you had not got any funds when you talked to 20 Mr. Traynor, you say that he gave you the figu re of 21 £200,000 which you thought was wrong. 22 A 23 367 Q 24 25 That's r ig h t. You had not got any figu re, you had not got any sums then, so how does t h i s . . . (INTERJECTION)? A I had some fi gu re s which I had wr itten down and 26 given to Mr. Traynor which was about £400,000 or 27 £380,000 and he said, 28 i s only £240,000 something.' 29 The explanation then, you are now suggesting, i s 61 'no, that ca n' t be r ig h t, i t 1 that there had been t h i s sum of £161,000 2 transferred? 3 That i s what I am now thinking. 4 369 Q 5 A 6 370 Q 7 I t was tr ans ferre d to your account? That's r ig h t. You had omitted to put that in your c a l c u l a t i o n s , i s that what you are saying? 8 A 9 371 Q That's c o rre ct. We have been through t h i s already, that t h i s was on 10 the order of your son Paul. 11 now, where i s his address now? 12 A 13 He i s in New York. Where i s your son Paul I haven't got his address on me at the moment, but I w i l l furnish i t to your o f f i c e . 14 372 Q 15 A Would you send i t to Ms. Cummins, p le a s e . Yes, I w i l l get somebody to furnish i t to your 16 office. 17 MR. JUSTICE COSTELLO: He gave no orders what so whatsoever. 18 Very well then, Mr. 0 ' Reilly-Hyland, thank 19 you for your a s s i s t a n c e . 20 evidence w i l l be typed up and we would ask you to 21 come in to sign i t and we w i l l l e t you know. 22 Thank you very much. 23 MR. JUSTICE COSTELLO: 24 25 26 27 28 29 END OF INTERVIEW The t r a n s c r ip t of t h i s Thank you. % i 61)INMESS ' TOP TEN I MAHON APPENDIX LOANS /EXCLUPINS AT 3 30 LIMITED * APKTt. ■ 1 9 7 8 SUBSIDIARIES) Percentage of B a la n c e £•000 7. * K .P . O ’ f t e t l l y H y l a m t / B e m f o i r d I n v e s t a e n t i L t d . 616 M ik A ssets K .P. O 'R e W y H y la n d /S tra tfo rd f t w a s f a n t s L M t i d K .P . O 'R a l ll y H yland - - 1180.2S2 • Ho. 2 A ccount - No. 1 A ccount £232,541 • £ C u rrm t Barvsford InvostMnts Lfnttad * - 3 ,5 4 4 - 1 618,023 I4 1 C .4 4 7 1199,556 ‘£51 6 , K.f. Q»-I11y Hyland - 1416.467 Purpose: All th* facllltias taw boon frtnttd fety my of personal loans. Sacurlty: (a) Th» Do. 1 account Is iecur«d*hy*iui Identical d*pos1t b«ld with. a Nholly owfed subsidiary of Sulnntss and Nation, Dublin In th* CiyMn Islands (b) A Solicitor’* undertaking as to lands tatd 1s llstad as tha sacurlty for th* No. 1 account. Homvor. on «x«1nation w* found this undertaking could not bt locaUd («n understand that tha undertaking has. bom locatti! since coaplatton of our T ba b a n k a n g ag a s 1n two t y p a s o f l o u t u n d a r t h b b a a d l n g ( l) .i* o * « a l b a c k t o - b a c k la n d ln # and (1 1 ) la n iH a * w haro t h a b a n k h a s t h a s a c u r t t y o f t daposlt a lth o u g h t h a d e p o s i to r a n d t h a l a n d a r * a y n o t h a t h a s a a a p a r s o n th a bank c a l l s ^ ^ (1 ) th a s a " o f f s a t" lo a n s . . lack-to-back loans . T h a s a lo a n s f n t o t a l a r n u n t t o a p p r o x lM ta l y 1 2 n i l l l o n . In v o lv e d a r a : 1870.000 K .P. O 'R a H ly H yland 1 5 8 0 ,0 0 0 1450.000 Tha backing daposlts ara hald 1n tha Cayman Islands. T ha m a jo r l o a n s - B ruce : A s req u ested I l i s t hereunderp a rticu la rs o f th e A cco u n ts fo r w hich w e b o ld d ep osits from GM CT : a) b) ■ N on R esid en t A c m w iu ( which a re Included la th e fu ll s e t-.:# tt ca teg o ry fo r C en tral Bank R eturns : ’ R esid en t A cco u n ts fo r which w e hold d ep o sits from GMCT d u ly h y p oth ecated : K P O 'R ellly-H yian d . 493,298.31 S tg . % Mr. J.D. Traynor, Ansbacher Limitad, c/o 42, Fitzwilliam Square, Dublin 2. Dear Des, X refer to your letter of 17th April. The attached schedule sets out the account details requested as at 3lst March 1990. I have discussed this list briefly with Padraig, but if there are any queries perhaps you would let me know. Yours sincerely, " 7 7 M A S T X N U & I O A N - O •K B B T O B . Guinness & Mahon L t d ., 17, Collage Green, PPBLIK. 2 . y D ea r Sira, 1 In consideration of your placing at the disposal of BSBESVOHD I X V B K K B t T S LIMITED 39, Moles worth Street, Dublin, (hereinafter referred to as "the Principals", which expression shall include the successors in tltl6 to the principals) & l o w licility of up to £72,500 (seventy-two thousand, five hundred pounds) on terns and conditions set out In a letter dated 5th January, 1970 addressed by you to the Principals, w e the undersigned L.D. McGonagle, K.P. O'Reilly'-Hyland, J.D. Traynor, J.J. Finnegan, S. Stephenson and Arthur Gibney hereby guarantee to you that in the event of the principals failing for any reason whatsoever to place you in funds sufficient to repay when due any loan o r loans aade or liabilities Incurred under such loan facility or failing for any reason whatsoever to pay you as and when the save ought to be p ai d any commission, interest, other charges and expenses, including legal costs, payable to you under the terns of such loan facility, we shall forthwith on demand renit to you the full amount of every loan or loans nade or liabilities . incurred then outstanding, together with an amount equal to all connission, Interest, ether charges a n d expenses, including legal costs, unpaid as aforesaid PROVIDED A L W A Y S that the liabilities enforceable against us respectively under this guarantee shall not exceed in total 8 5 % of any loss Incurred by you in consequence of your loan and shall not exceed in the case of any one of us the sum of £10,000. This guarantee shall not be considered as satisfied by any intermediate payment or satisfaction of the whole or any part of any sum-sr sums of money owing to you as aforesaid, but shall be a continuing security and shall extend to cover any sum or sums of money which shall for the time being constitute the balance due from the Principals to you under such loan facility (including all commission, interest, other charges and expenses, including legal costs, payable to you b y the Principals) and any admission or acknowledgment in writing by the Principals or any person authorised by the Principals of the amount of the Indebtedness of the Principals to you shall be binding and conclusive against us or our respective executors and legal personal representatives. We undertake this guarantee as principal debtors and not merely as sureties and this guarantee and your rights under it shall not be prejudiced or affected by your enlarging, reducing, or varying the aforesaid loan facility, or by your holding now or hereafter any collateral, or other security for all or for any part of the monies hereby guaranteed or by your varying, releasing or omitting or neglecting to enforce any of the terms and dondition* of such loan, facility. or any securities, or by your giving time for payment to, or accepting composition from or granting any •. • indulgence to or making any other arrangements with the Principals or any person liable on any securities held or to be held by you. In the event of the Principals going into liquidation we shall not prove in competition with you • in such liquidation in respect of any debt due from the principals to you as aforesaid, but shall give you the benefit of any proof which we may be entitled to make in respect of any part of such debt paid by us until . you have received the full uount of the said debt. No change whatsoever in the constitution of your Company or in the constitution of the Principals shall Impair or discharge oar liability under this guarantee. . Any demand for the by us hereunder may be made post and such notice shall received on the day follow! posted. yment of any sum payable notice sent through the emed to have been e day on which it was In p r o v i n g that a s h a l l o n l y b e n e c e s s a r y to ; p r o p e r l y addressed, stamped! r e c o r d e d d e l i v e r y mail. d was duly made it the notice was ted by registered or This guarantee 1 substitution for any other us or any of us. ,tlon to and not in given to you by % ftai-gsford Investannts United - I199.S56 m m m m Shareholding: Mr. K.P. O'Reilly Hyland has tha Majority shareholding In this coopsny. Purpose: . Security: (a) Solicitor's undertaking to hold the title deads of tha property purchased to the bank's order. ' (b) A lien on the shares of the conpaiy. m (c) The loan 1s 1001secured hy deposit balances held with a wholly owned trust subsidiary of Guinness I Mahon In the Cayaan Islands. m ¥ > * * * fa ■ ■ ■ ' • Interest: Interest Is charged at tha Buimess I Mahon base rate and Is payable guartarly. Commit: The loan was granted In October 1969 and has baen extended yearly since. There have been no capital or Interest repayments since the granting of the loan. The coa^any has received an offer recently of £195,000 for the property. ¥ ¥ Purchase of proparty comprising of a warehouse and som office spaco In tha Cape! Straat araa. URCINT 1 L— —J R>hi M m u m IMS rtSAWPAYTt DAYWITHOUTCHAH0B5TOUS;\ l . 175*000- TO Bank of Crodtt ft OmmmW' 100 te#4ealwll stTMt. loodoa AoeoaBt K.». O'ltollly Mrlaad ^ \ AmMMufe H o. 6 4 /6 1 3 « l U w l * X a. (29,188- 14 TO bdMlb k n th i MoyaX.Bank of Seotlwd, MuulMMt«r, iocoont M U i IttHfi IflNant Mo. 1999774 0/0 v>«. cso.ooo- *0 luk of XraXwd, City Offlea, a tenfaaxd ............... ttxMt, tendon 130-14-071 A o e o u n t . Moount Mb’. *s 44713074 0/0 . ^iVniM11 hriii /O - p g - X I “ 1 '0 '^X7S VUfiX TCDATl- % !r i' >« J***- •> IIMiMJ-j (n a trinity tank Dublin. a. 1700.2H)-j»d rroM ro u f >Xv» U i o/M Dapo. tu r i ‘V * ' S T H l . . ~ ^ r . .*.«*■ ~ Jj G+M T * BANKERS ««*r GUIttKESS MUON CAYXAJl TRUST LTD oerosiT non sutsxo stealing LED G ER P/C CALL 0/A QUX UNISONS • 1‘ * laAPRti ^BALANCE UOUCHT KftKARO;. 22ATRM PBL MOV w . ~ •* f« c a o v :~ ■•* ZMPKMC mA/m'Kv • £ > • '? & H tfU i' __ M^emesx. iuu&i .t atma 17. BtfKH b r o s so e n . r ZMfKMt 2 0 .0 0 0 .0 0 ’• ItTVf.si V*- t •: 1 * 1 1 5 .0 0 E •"W ,0 0• 0 . 0 0 *• . / > s. ••* *i, * •t »• ♦ •« ’ i4,W .TS jd z s & z * i * 01KA TW w u * w .. e c q b c n tiM s s s .«.. U mahon , vra POtfkOV. . - • • - . .. i.r .--. Exqi-CUINMESS fUHON.CJmtt ••-V. WP 02IMYM renjAOttcg.,-. ..*j. „ ; • .%?*••• p a t U o v ■ «• # • • .*.Jt5 a.» ’i •_ .. . i • . . *. ? -i % • S %r ’ fr ’ 4r s.* w p j ir o iv 'a iiw a i fttao K~. rr3 •» 2 a •• - « *.v«. MlwallikwMaMMi itN o .a u 1 .3 0 0 .0 C .. I I M « V •• •3Zt626.« 4 » 0 * 0 .0 l 6 0 .0 0 GiUlMNIESS+MAHONLTD] 1?Coa^QrMiOabaB2PAIatSIATArtaHfftl .• STATIN ENT NO. PAGE NO. * •V rl 51 1 . ) w ) g +m BANKERS c u in m e &s w u u t conm kt ltd STATEMENT NO. PACK NO. 209 I 03214004 S T O U .M 6 MOSTRO LEDGER _______ *■*" ... ZBAMttd *MUMU IftfM I UMN Off 6HINISI W MWN EXCHTUNXTV UNK U « r NAT NEST ■■ 29A FM 6 1 7 1 * 6 5 1 .0 3 : “ 700«Z10.t6 130v000.f0 31«240.< 7 UHMK lt» O T * l« 2 0 * 0 0 0 * ti0 39*TS4.TT 90*000.001 ?9*ooo*oo : 790*000.001 «e tm __ _ UMI QNGUINNESS IttHON* D . I k M L __ .r * a W ® J S B * * B II n« •* B row**' ■ *tMm * 3h i w jwtt* vamn 1MMWWW «xn hbmm l u»»nri f w is r w i *« */* ____- - •09 « NOMMtsm m M«rt HHM M* t «t-CI WU TW Wt- . ' •«». z( 9ST.. < / Im U « M tm b tr a f t i* H m ry A ru b tc H rr H o U H n g t F L C M tn h tm G ro u p P.O. Box 187, Quad Cqmaa, British W v bdhc Please reply to: Binnr (Mt) TW 42 Fitzwilliam Square, . Dublin 1 Tel; 765144/763065 Rue 612035 T rin e C P 4309 F tac 0 0 9 ) M 9-7M 6 (109) 949*5367 29th July, 1991 Garrett Logan, Esq., Irish Intercontinental Bank Limited, 91 Merrion Square, DUBLIN 2. j Dear Garrett, Would you please arrange to transfer the sun of Stg.£350,000 to the Current Account of Houtotd ** Paul H. 0 1Railly-^yland - at the __ f OtAjbfal Bong Kong A Shanghai Banking Corporation Ltd.,0 Head Office in Bong Kong. _ . 1 * l&n* u ifluJbb CurAAtM fu tv te 4 /c . The Account number is M £ - 3 0 2 5 £ 3 ^ U <£r . it. The funds should be placed'vaiue Ttiftftday 6th August. The debit should be to Ansbacher Limited Call Deposit Account Mo. 02/01087/81. •N " . ,I would bo grateful if you would please confirm. ^ Yours sincerely, . .. J.D. Travnor. --a - ■ . . •*> l^ o c tt« k W i» T iv s l G rou p frnkm aoiM«8317 T e le fa x n «K '^ A ftB A. WweM, a « . Rtf no. To; Xrlah IbtareeatlMBtal Bnk, Dublla Xrtlaad • © a ir - B ill pagatofOy ■«-««» m+*m A U fa * ^ nf W D tM iw m cm r t w n t o g /W O B jP w h i ^ w w iw r w iw o w iio o iH M ftw ii fe S S tftS g J U g g j S W S B S a * J d g su -a w "B PSSi iOlOq GUINNESS M A H O N C A Y M A N TRUST LIMITED A N D SUBSIDIARY C O M P A N I E S N O T E S T O T H E ACCOUNTS. . SHARE CAPITAL - ’ SUBSIDIARY C O M P A N I E S INVESTMENTS Held by a Subsidiary Marlborough Holdings Limited 120 £160 The investment in Marlborough Holdings Limited, a ■company Incorporated in Ireland, represents 12% of P A N N E L U K E R R r O F J S T K R ft C O M P A N Y th e e q u ity o f th a t c o m p a n y * T h e in v e s tm e n t i s a t c o s t a n d n o m a r k e t v a lu e s a r e a v a ila b le . a h o tr a T PAN N E L L K ER R rO H S T* R « COM PANY CREDIT COMMITTEE APPLICATION M inute No: G .6 M. D u b lin jjy f/ RENEWAL/ IMCTZX3g/RggtfCTZ0K/jCMZXBMBff: BORROWER/OBLIGOR: D a te : \% • I C r e d it C la s s : S a t i s f a c t o r y X .P . 0 ' REILLY-HYLAND . GUARANTOR: PROPOSAL & PURPOSE OP FACILITY(S) :E x te n sio n o f Loan f a c i l i t i e s (o v e r d r a f t £ 5 0 ,0 0 0 , lo a n £ 4 0 6 ,0 0 0 ) g iv e n f o r p e r so n a l I n v e stm e n t p u r p o s e s . He r e p a id S t g . £ 6 0 0 ,0 0 0 d u r in g 1 9 8 8 . D uring 1989 e x p e c t s t o r e a l i s t . u p t o Elm from s a l e s o f In v e stm e n t p r o p e r t ie s (our In fo rm a l v a lu a t io n March 1988 a t t r i b u t e d v a lu e £ 7 0 0 ,0 0 0 t o cu stom ers p r o p e r t i e s ) . We h a v e In d ep en d en t c o n fir m a t io n t h a t t h e s e s a l e s a r e In f a c t p r o p o s e d . P r o c e e d s t o b e u sed In r e d u c t i o n o f p e r s o n a l I n d e b te d n e ss and t o ta k e a d v a n ta g e o f CAT exem ption .la lf c s t o t r a n s f e r a s s e t s t o h i s c h ild r e n . S e e n o t e a tta c h e d 7 H H 5 S ~ a f Repaym ent, Repayment t>rogramme & P i n a l M a tu r ity : ~ D e l^ id f a c i l i t i e s s u b j e c t t o rev iew 3 0 .9 .8 9 . Repayment from s a l e o f in v e s tm e n t p r o p e r t ie s and o th e r p erso n a l r e s o u r c e s .__________;______ . B ^ ’J c's Income (I n c lu d in g R etu rn on C a p it a l) : “ XI- r e s t a t BLR +■ 2% (ROC 48%) - Security and Security Margin: ! """" ” (1 ) T i t l e d e e d s 67 N u tle y Avenue (Held i n t r u s t jfcge K P O 'R eilly Hyland I I ) v a lu e £ 1 5 0 ,0 0 0 (2 ) 17471 s h a r e s McDonagh s Boland L td , v a lu e e s t im a te d £ 1 5 0 ,0 0 0 ( 3 ) S e c u r it y I s a d e q u a te f o r £ 3 1 0 ,0 0 0 %#■ ____________________ ;_________________ D ther C o n d itio n s P r e c e d e n t: " Dther I n fo r m a tio n : . INTEREST ROLL UP PERMITTED KPORH HAS INDEMNIFIED US IN RESPECT 0 ? LLOYDS GUARANTEE’ S STG.£ 7 0 ,0 0 0 FOR ■WO OF HIS , CHILDREN____________;___________ ;________________________________________ ANK'S RISK EXPOSURE - A g g r e g a te ( in c l u s iv e o f t h i s p r o p o s a l) t o : B orrow er/O b lig o r R e la te d B o r r o w e r /O b lig o r onu n ltt e d /L im lt : £45 6 ,0 0 0 cwftHtwMr _ £ 8 5 ,0 0 0 . £ 4 3 1 ,0 0 0 £ 8 5 .0 0 0 .‘V R isk : r^niary R isk : L im it: C ountry o f Prim ary R is k : IRELAND* • Commt: S eco n d a ry R is k : . __ Drawn: D o m ic ile : acv^r R is k : a c to r : L im it: ' GM B u s in e s s Sector:PERSONAL Commt: C BofI B u s in e s s Sector:PERSONAL R isk A s s e t W e ig h tin g : 1 .0 Drawn: I tr o d u c e d by": CUSTOMER 6P LONG Recommended by: MLOK TANDING »cision; irX i C r e d it C om m ittee Chairman M inute No: 15 %? blla. Board ^ Dat.: M inute No: GM&Co. D a te: MINUTES OF CREDIT COMMITTEE MEETING HELD ON WEDNESDAY 25 JANUARY 1989 Present: JOP (* TW-A />RG MJW P re se n t fo r 89/66, JMJQ* 89/75, KMC 89/76 only) BANKING Amendments; 89/75 Decision: • K P O'Reillv-Hvland Resubmit. . 1) An explanation of the Return on Capital figure is required. • 2) Further information required on 67 Nutley Awenue. IF held in trust, is this ualid security? Occupancy of the property is not stated: the basis of ualuation of £150.000 is required. If tenanted, thgn a tenanted valuation sho.uld be giwen. • 3) Is 3 the sum of 1 & 2 or Is this ^adequately backed to the extent of £310,000 in addition? . X GUINNESS HA HON 4- CO LIMITED TO: OATE: P R O M : ’Michael Whitmarsh 26 January 1989 GAM DUBLIN - C redit Committee K P 0 1REILLY—HYLAWD Referring to application and minute 39/75 submitted to Committee earlier this week, I can- now supply the follouiing information. . - , The security held is firstly the title deeds of the property in Nutley Avenue. This property is held in trust by K P O'Reilly-Hyland II (the son) for Dublin's customer, the deeds are informally held and Dublin do not have a mortgage. It does have a tenant but even so Dublin are fairly sure that this £150,000 is a very consaruatiwe estimate of the value. There are the private company shares with an estimated value of £150.000 and thirdly,, ''adequate 11 security valued a_t £310^ 0 0 . W o T i r T T rreH^ReFeTcjreTocn^ ^ total security w h i c h ,tln ey",," value at a m i n imum of £610,000. Due to the informal nature of the charge over the property the security, as Martin Lanigan-0'KeeffeV states, is light. However Mr O'Reilly-Hyland has been customer for nearly 20 years and is extremely wel l respected locally. He is Chairman of Burma Castrol (Ireland), Chairman of friends Provident (Ireland), a main Board Director of UK friends Provident and UK Provident. He is a former Director of the Central Bank of Ireland. • He is paying 2% over Dublin base rate which, bearing in mind that Dublin base rate is some 1% over cost of funds, immediately gives this borrowing a margin of 6% (hence the return on capital of 48%). Martin feels that this is one.of Dublin's better customers and the very type of person wh o m they are trying to attract. I feel in view of the additional background that we now have, uie should approve this renewal of facilities. STATEMENT OF KENNETH P.O’REILLY-HYLANP 1 refer to the request from the Inspectors for a statement providing information in relation to matters under investigation by the Inspectors. I have prepared this statement from my best recollcction o f events going back approximately 37 years. In 1963 I became a member o f Lloyds. A feature o f membership was a potential unlimited personal liability in the event that Lloyds were to make claims against my assets. Stop Loss Insurance Policies were not available at that time. I received professional advice from Clifford Turner to the effect that it would be prodent to establish an off-shore trust. The partner in Clifford Turner advising on the matter w as the Honourable David Nicholson (later Lord Camock). In or about April 1964 a Trust was established in the Bahamas through Clifford Turner and I paid a sum o f approximately S tg .£ l00,000 into the Trust Fund. The beneficiaries o f this Trust were to be my family. The Trustees were a firm o f Attorneys in Nassau. The Trustees had complete discretion in the operation o f the Trust. In early 1966 I mentioned the existence o f this Trust Fund to John H. Guinness o f Guinness Mahon Bank. H e noted the Bank had in mind establishing a similar fund. It was put to m e b y John H. Guinness that he had an excellent investment team and I would be w ell advised to transfer fluids in the Bahamas to Guinness & Mahon. At some point in the late 1960s I did so. A wholly owned subsidiary was established by Guinness Mahon and the subsidiary was called Guinness Mahon Cayman Trust Limited. This subsidiary was operated and managed by Guinness Mahon, its registered office would be in the Cayman Islands but its management w as part o f the management o f Guinness Mahon in Dublin. A shelf company w as allocated to me to use, Newport Agencies (Overseas) Limited. I gave to Guinness Mahon the documentation that T had relative to the establishment o f the Trust by Clifford Turner, including the Trust Deed. I understood that they would do and did do whatever was necessary to effect the transfer o f funds to Guinness Mahon Cayman Trust Limited. 1 believe the transfer o f the Trust Funds took place in 1969 or at the latest in 1970. ' Subsequent transfers were made to the Trust Fund. the details. At this remove I cannot recall B y the early 1990s Mr. D es Traynor had been my contact at Guinness Mahon for a number o f years. He discussed with m e in 1991 a payment out o f the Trust Fund by the Trustees to one o f my family, principally m y son Paul. I recall that distribution was made in mid 1991. This money was subsequently loaned to m e by my son, Paul, to m eet huge liabilities at Lloyds. In the early part o f 1 9 9 4 1 met with Mr. Des Traynor. H e told m e the balance in the Trust Fund. I expressed considerable surprise as the sum referred to was a sum short o f £200,000 less than I had anticipated. . In the course o f that meeting with Mr. Traynor I expressed a wish that the Trust be wound up and that the Trustees make distributions to the beneficiaries. This I believe occurred shortly afterwards. 2 1 / 0 b / -2 0 0 8 1 4 :4 ? W H I T N E Y . M O O R E & K E L L E R ■» 2 0 3 3 3 2 9 NO.749 At all tim es from 1969.'1970 onwards, I understood Guinness Mahon to be operating and managing the Trust Fund held with Guinness Mahon Cayman Trust Limited. During the life o f ihe Trust I was not aware o f any involvement by Ansbacher Bank or Irish intercontinental Bank. I believed Mr. Des Traynor to be an em ployee o f Guinness Mahon at all times. All contact I had with Guinness Mahon over the years regarding the management and operation o f the Trust Fund was through Mr. Des Traynor. As noted above, the Trust Fund was duly wound up in 1994. Finally I confirm I did not at any time deposit m oney with Guinness Mahon Cayman Trust Limited or into any account maintained by that company in its name or in any other financial institution. I have no knowledge and did not avail o f the services that are referred to and are state letter o f 21st Decem ber 1991 Dated the 21** day o f June 2 I:\0\OR7941-00l\$trtunant.2.doe D003 00+0 9205 MARS El t GA 10+ MOM INTLX ON Ok K s M i i 1% “ 3 $ V?TH^YOU°UNTIL^YOO SUCCEED IN GETTING TOE NUMBERi tbyiMS MOM PSE IF I CANT RAISE I CANT KEEP TRYING HERE GOES 5205 MARS El . ' / ’"'■> . ;0>w0INCSS CP MARS El TOj mike DATE* URGENT. - / , Lut SHIELD. ESQ.. GUIMCSS MAHOM CAYMAN TRUST LTD. 13TH HAY 1977• BENEFICIARY MM NEWPORT AGEWIK ^IHNG ^TH J.D.T. _ TO-MORROW AND DETAILS OF ^ *»OONTSFROM lyTOCTOBER, 1976* TO DATE REWIRED. I CAN PTOVIOE O U B L I N J T A / D AND LONDON A/DI BUT REQUIRE MDVO€NTS ONI CUMENT^A^gg vm. MAINTAINED BY YOU SUNK TOGETHER WITH ANY OTHER ACCOUNTS YOU MAY HAVE. J*OU£ APPRECIATE A REPLY BY RETEIAN TELEX. *— ^DSRU. LMNfcROf . ' TIMEI16.06 . ‘• : •‘ GUIKMESS + MAHON LTD. DUBLIN. . ■\ . • ’ ’ — * ' • . . . * O’ M 'ILTOMPARKiHCUS .'ILTGNPLACE DUBLIN2 TELEPHONE(OI) 67S 0631 FAX^01) 676 64.62 E-MAIL: ecommsia)wmk.ie D.D.E. 80X NO. 105 J .P . H A Y E S S .W . R IO R D A N H .V . T I G H E s^kaSaneaagaa WHITNEY, M O O R E & P .C . H A Y E S K .J . P A R K IN S O N F .G . O 'R E I L L Y M .B . R Y A N G .M . C A R R O L L C .T . R O C H F O R D V .M . C A R N E Y J .K . L Y N C H M .P . D O R A N KELL E R The Inspectors appointed by Order o f the High Court to Ansbacher (Cayman) Ltd. Third Floor, Trident House, Blackrock, Co. Dublin. A S S O C IA T E S A .M . B E R G IN A .E . H A R V E Y A. M U R PH Y C O N SU LTAN T J . P . O ’C O N N O R Jjifi BY HAND our ref GC7941/1 your ref C/011/NSPM 11th December 2001 Re: Our client - Kenneth P. 0 ’Reilly-Hyland Dear Sirs, We refer to your correspondence with Kenneth P. 0 ’Reilly-Hyland o f the 20th November 2001. Mr. O’Reilly-Hyland has suffered considerable illness, particularly over the last 12 to 15 months. In that time he has been obliged to undergo surgery on two occasions. He is under continuous medical review. We have only had the opportunity to discuss your letter dated 20th November 2001 and its attachments, with Mr. O’Reilly-Hyland by telephone. Due to the fact that he was obliged to travel to England last week for the purpose o f a further medical consultation with his advisors, we have not been in a position to meet with him. He fears that arising out o f these consultations with his medical advisors in London further surgery may be required. Clearly we would wish to have the opportunity to take detailed instructions from our client having regard to the “preliminary conclusions” which you have reached. It is clear that we will not be in a position to do this until early in the New Year at best. In the circumstances we ask that the period o f 21 days given to our client for the purpose o f providing a written reply to the preliminary conclusions should be extended and he be given until Friday, 25th January 2002, for the purpose o f providing that reply. In respect o f the document described “Inspectors P relim inary C on clu sion s” a number o f preliminary issues arise. It is stated that the evidence supporting the conclusions was the evidence given on oath by Mr. O’Reilly-Hyland together with documents shown to him during the interview. We are wholly unclear as to the basis of the conclusion you have reached that Mr. O’Reilly-Hyland was a client o f Ansbacher. The term “c lie n t" has several meanings. In the context o f a relationship between a party and a professional person where that person is intentionally using the services o f the professional person the term c lie n t” is clearly understood. It can also mean “custom er". The statement that Ken O’Reilly-Hyland was a client o f Ansbacher does violence to the concept “c lie n t”. Undoubtedly Ken O’Reilly-Hyland had money that he put into Trust. The fact that in the course o f the management of the trust funds all or part may or may not have been placed in an Ansbacher account does not justify the description o f Ken O’Reilly-Hyland as a “client o f A n sb a c h e r”. Having perused our note of the attendance before you on the 22nd June 2000 we cannot find the evidence that sustains any finding that Mr. O’Reilly-Hyland was a client. We can only assume you have some artificial definition of client. If this is so perhaps you would indicate what it is and we can consider the matter further. In respect o f the establishment o f a trust whilst Mr. O’Reilly-Hyland did give evidence o f establishing a trust for the purposes o f protecting himself from liability concerning being a name at Lloyds he does not accept that he caused a trust “o f which A nsbacher w as the T ru stee” to be established in the Cayman Islands. Again as it is not possible to understand how you reached this conclusion on the documentation provided, Mr. O’Reilly-Hyland wishes to be informed as to the basis o f this conclusion so that he may have some opportunity o f dealing with the asserted conclusion. In respect o f conclusions (c) and (d) they are in part premised on an acceptance o f conclusion (b) the basis o f which remains to be explained. Ignoring that issue the position appears to be that you have chosen to reach conclusions on the basis upon which you believe trust funds were held. Mr. O’Reilly-Hyland’s clear and uncontroverted evidence is that he was unaware o f these matters although he readily accepts having established a trust. What evidence are you relying on? In so far as Mr. O’Reilly-Hyland is said to have enjoyed the use o f the trust funds by means o f a service provided by Ansbacher, whereby he was unable to withdraw funds from accounts in Ansbacher’s name in GMI and IIB, again this preliminary conclusion ignores the state o f the evidence. Mr. O’Reilly-Hyland has given evidence that in so far as he borrowed funds in Ireland such borrowing was effected on foot o f security offered from Ireland. Whilst it may be the fact that Mr. Desmond Traynor or those who appear to act on his direction may have made annotations as to Mr. O’Reilly-Hyland’s means, when considering loan applications, that does not, with respect, sustain the preliminary conclusions that are mentioned at sub paragraphs 2 (c) and (d). However, as the basis upon which these conclusions are drawn from the evidence that has been given is simply not explained. All Mr. O’Reilly-Hyland can do is await a proper statement as the basis upon which the conclusions have been reached. It seems to us, with respect, that another substantial issue arises in the manner in which you have stated your preliminary conclusions. Whilst we are unaware as to the manner in which your report is to be presented the conclusions you have drawn about Mr. O’Reilly-Hyland, absent any explanation as the evidence that was given and the contradictions in that evidence, presents Mr. O’Reilly-Hyland in a way that does not do justice to the extent o f the evidence available. We are entirely unclear why you have chosen to present the information in this way. It occurs to us, at this preliminary stage and without knowing the full details as to the rationale which is supportive o f your preliminary conclusions the following might be said o f Mr. O’Reilly-Hyland: 1. At a date unknow n Mr. O’Reilly-Hyland caused a trust to be established in the Cayman Islands. 2. The Inspectors investigations establish that, unknow n to Mr. O’Reilly-Hyland, A nsbacher, as that term is defined, within the report, were involved with th e operation of the trust through the offices of Mr. D es Traynor. 3. ^ In so far as Mr. O’Reilly-Hyland borrowed money in Ireland from Guinness & Mahon (Ireland) Limited he may have been assisted, in part, because o f Mr. Des Traynor’s knowledge o f his trust fund but in circumstances where Mr. O’Reilly-Hyland was unaware o f this reliance or assistance . It is important to note, however, that when Mr. O’Reilly-Hyland did borrow money in Ireland from Guinness & Mahon (Ireland) Limited he had substantial assets in Ireland against which such borrowing was secured in the normal course. As you can see there is a material difference in this presentation. With respect it must be the appropriate presentation. On the other hand the presentation o f your preliminary conclusions appears to be designed to damage Mr. O’Reilly-Hyland in a manner which is, with respect, unjustified. We make this statement, o f course, in circumstances where no attempt has yet been made to explain to us the basis o f your preliminary conclusions. We await hearing from you as a matter o f urgency. We assume we will get the appropriate information to allow Mr. O’Reilly-Hyland comment appropriately on your preliminary conclusions. Yours faithfully, WILTCNPARKHCUSE WILTONPLACE DUBLIN2 TELEPHONEtOI; -576063 FAX(01 ) 676 6462 E-MAIL: ecomms-//mk.ie D.D.E. 3GXNO. 105 J P. H A Y E S S .W . R IO R D A N WHITNEY, M O O R E The Inspectors appointed by Order of The High Court to Ansbacher (Cayman) Ltd., Third Floor, Trident House, Blackrock, ‘ , Co. Dublin. GC7941/1 8c K E L L E R H .V . T IG H E P C . H AYES K .J . P A R K IN S O N F .G . O ’ R E IL L Y M .B . R Y A N G .M . C A R R O L L C .T . R O C H F O R D V .M . C A R N E Y J .K . L Y N C H M .P . D O R A N A S S O C IA T E S A .M . B E R G IN A .E . H A R V E Y A. M U R PH Y CO N SU LTAN T .*1 * C/011/NSPM J .P . O ' C O N N O R 15th January 2002 Re: Our client - Kenneth P. O’Reiliy-Hyland Dear Sirs, Thank you for your letter dated 18th December 2001 in response to ours o f 11th December 2001. We note the terms o f your amended Preliminary Conclusions concerning Mr. Kenneth O’ReillyHyland. We have now had the opportunity to consider your letter dated 18th December 2001 and its attachments together with Mr. O’Reilly-Hyland and Counsel. /-v We are far from happy that Mr. O’Reilly-Hyland should be considered a client o f Ansbacher. It appears to us that this designation depends entirely upon your artificial definition o f “client”. We are o f the opinion, and have been so advised by Counsel, that it is wholly inappropriate for High Court Inspectors to use such an artificial definition for the purpose o f then using that definition to make statements o f fact. It may be your belief, on the information which you say is available to you, that within your definition o f “client” you can use that phrase o f Mr. O’Reilly-Hyland. We are satisfied that it is wholly inappropriate that you should either indicate what you are in a position to say as a matter o f fact or opinion by reference to such definition. Your Preliminary Conclusion fails to take into account the evidence, uncontroverted, that Mr. O’Reilly-Hyland had no idea he was a client o f any company that you define as “Ansbacher”. The fact that you have written to Mr. O’Reilly-Hyland asking for his comments indicates that you are aware that your findings are likely to be damaging to Mr. O’Reilly-Hyland. Indeed this is clear from your initial letter dated 20th November 2001. In such circumstances it is disappointing that you would appear to stand over such definition o f “client” knowing that it would be damaging to Mr. O’Reilly-Hyland. W M & K Mr. O’Reilly-Hyland is in our submission entitled to know why you insist on taking this position. This has not been explained to date and we would ask that you explain it without delay. Yours faithfully, r '•A'ILTCNPARKr-tCOGE .row place .BUN2 TELEPHONE(OH 5. o FAX(O1) o78 0*162 E-MAIL: scomms'^’-vmk.iKj D.D.E. BOXNO. 105 J .P . H A Y E S H .V . T I G H E P .C . H A Y E S WHITNEY, M O O R E & KELL E R The Inspectors Appointed by Order o f the High Court, Ansbacher (Cayman j Limited, Third Floor, Trident House, Blackrock, Co. Dublin. our REF GC7941/1 R e: K .J P A R K IN S O N F .Q . O ’ R E IL L Y M .B . R Y A N ' G .M . C A R R O L L C .T . R O C H F O R O V .M . C A R N E Y J .K . L Y N C H • M .P . D O R A N A A A A S S O C IA T E S .M . B E R G 1 N .E . H A R V E Y . M U R PH Y CO N SU LTAN TS J .P . O ’C O N N O R S .W . R IO R D A N your ref C/011/NSPM I!" 6 February 2002 O u r c l i e n t - K e n n e t h P . O ’R e i l l y - H y l a n d Dear Sirs, We refer to your letter o f the 8th February 2002 acknowledging the contents o f the submissions made by us on behalf o f Mr. Kenneth P. O’Reilly-Hyland (Mr. O’Reilly-Hyland) in respect o f your then stated preliminary conclusion in his case. We are gravely concerned to note that the conclusion is now “fin a l" . We hope that the material we set out hereafter will be deserving o f your consideration and lead you to make certain further modifications to your preliminary conclusions. ^ In the circumstances, it seems to us that the only rational explanation o f the evidence available to you is as already identified in our letter o f the 11th December 2001, in particular sub-paragraphs 1 to 3 contained in that letter. We might add to those numbered paragraphs that it would be appropriate to describe Mr. O’ReillyHyland as a retired businessman and former name at Lloyds. We are at a loss to understand why you have given no prominence to the uncontroverted evidence given by Mr. O’Reilly-Hyland that when he borrowed money in Ireland he did so secured on assets within Ireland. The thrust o f your presentation is that Mr. O’Reilly-Hyland’s account o f the establishment o f his trust and the purposes for which it was used is in some way untruthful. In particular, it is clear that you are concerned to write a report that suggests that Mr. O’Reilly-Hyland, having retained the services of Guinness & Mahon, is responsible for the arrangements put in place within Guinness & Mahon to deliver the services he was entitled to expect. Your preliminary conclusions, because they fail to attend to any o f the points that have been made in our correspondence or in this letter represent a wholly inappropriate set o f conclusions. We reiterate again our complaint that the definition o f “c lie n t” is so convoluted that it leads to what appears to be a simple statement o f fact by your good selves when the position is quite different and not a fact that is to be gleaned from the conclusions you propose to publish o f our client. Given your conclusions can, in certain circumstances, constitute prima face findings o f fact against Mr. O’Reilly-Hyland, it is wholly unfair (in the legal sense) and inappropriate that you should maintain your conclusions in their present plight. We are forced to conclude that you would appear to have set your face against any meaningful interaction as between what you want to say as a matter o f fact or opinion and what Mr. O’ReillyHyland has said and/or the evidence you have sustains, represents a failure to offer Mr. O’ReillyHyland fair procedures. We are willing to meet to discuss these matters. If you are not prepared to meet we reserve our right to be informed o f the evidence you say exists to sustain your findings and, where appropriate, to cross examine such evidence. We note, from your own procedures, that this is a course which you consider an appropriate entitlement to persons in Mr. O’Reilly-Hyland’s position. We look forward to hearing from you. Yours faithfully, WHITNEYvMOORE&KELLER Appendix X V 1. 2. (103) M r M i c h a e l O ’S h e a Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Michael O’Shea. a) Transcript o f evidence o f Mr Michael O’Shea dated 19 June 2001. b) Statement of Michael O ’Shea. c) Letter of 16 March 2001 - Michael O’Shea to the Inspectors. d) Internal Guinness and Mahon memo - JDT to P O’D o f 5 September 1984. e) Letter o f 2 May 1985 - DJ Barry to the Greffer’s Office, Guernsey. f) Letter o f 18 May 1992 - Joan Williams to Ronan Redmond, IIB. g) Statements of Account A/A54. h) Foreign Dealing tickets - Hamilton Ross. Correspondence received from or on behalf of Mr Michael O’Shea. a) Letter o f 14 December 2001 - Mason Hayes & Curran to the Inspectors. b) Letter o f 15 January 2002 - Mason Hayes & Curran to the Inspectors. UNDER OATH ON TUESDAY, 19TH JUNE 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: HIS HONOUR JUDGE 0 LEARY MS. MACKEY BL Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MR. MICHAEL O'SHEA Represented by: MR. KEVIN BARRY McGONAGLE KENNEDY BALLAGH WITNESS MR. M. I EXAMINATION JUDGE PAGE 48 1 2 3 4 5 JUDGE O'LEARY: I note your statement 6 with regard to the 7 voluntariness of your attendance and that is 8 accepted, Exhibit 1. 9 MR. O'SHEA: That is accepted. 10 JUDGE O'LEARY: By the Inspectors. 11 MR. O'SHEA: Thank you. 12 JUDGE O'LEARY: Yes. 13 Thanks. That is a fairly standard procedure 14 nowadays I think. 15 MR. O'SHEA: It is 16 JUDGE O'LEARY: It is indeed. 17 MR. O'SHEA: It is, yes. 18 JUDGE O'LEARY: Thank you very much indeed for attending, Mr. O'Shea. 19 20 My name is Sean O'Leary. 21 Inspectors. 22 pleasure of meeting before. 23 is the other Inspector. 24 MR. O'SHEA: I do not think we have had the 25 26 29 Ms. Noreen Mackey I have met Ms. Mackey before. JUDGE O'LEARY: 27 28 I am one of the You have met Ms. Mackey before. MR. O'SHEA: Yes. 1 2 3 JUDGE O'LEARY: 4 The position is that there are, as you know, four 5 Inspectors but only two of the Inspectors will 6 be dealing with any matter touching on anything 7 we talk about here today to you. 8 MR. O'SHEA: Yes. 9 JUDGE O'LEARY: Obviously, we have had to 10 divide up the work and 11 that is the way it is divided so far. 12 MR. O'SHEA: I understand, yes. 13 JUDGE O'LEARY: The position is that we 14 have a number of questions 15 to ask you both in your own personal capacity as a 16 member of a firm of solicitors and also in your 17 capacity as one of the persons named with legal 18 authority in the Will of the late Mr. McGonagle. 19 MR. O'SHEA: Indeed. 20 JUDGE O'LEARY: Yes. 21 So, it is in those two capacities. 22 MR. O'SHEA: Yes. 23 JUDGE O'LEARY: It is a very informal 24 procedure. There is only 25 one formal part of it as you know and that is the 26 question of taking the oath. 27 MR. O'SHEA: 28 29 Yes. 1 2 JUDGE O'LEARY: I note that you have a 3 solicitor here with you. 4 You probably will not need it but if you feel like 5 consulting with the solicitor at any time by all 6 means just tell us "Stop" and we will stop and you 7 can of course consult with your colleague. 8 MR. O'SHEA: Yes. 9 JUDGE O'LEARY: And similarly if your 10 colleague feels that it 11 is in your interest that we should stop at any time 12 all he has to do is to say "Stop" and we will allow 13 the interruption. 14 MR. O'SHEA: That is why Kevin is here. 15 JUDGE O'LEARY: What? 16 MR. O'SHEA: That is why he is here. 17 JUDGE O'LEARY: That is why he is here, 18 yes. I think you are 19 wise. 20 pair of eyes and ears there. 21 MR. O'SHEA: Right, yes. 22 JUDGE O'LEARY: I wonder if you would take People are wise always to have another 23 the oath now and we will 24 get on to asking you the questions we have. 25 MR. O'SHEA: 26 27 28 29 Yes. 1 2 3 4 5 1 Q. JUDGE O'LEARY: 6 Mr. O'Shea, the position is that most of the 7 connections which we have discovered relate, I 8 would think it is fair to say, to the activities 9 of the late Mr. McGonagle? 10 A. 11 2 Q. Yes. I think that is a fair summary. There are however 12 a number of things relating to your firm to which 13 we would also like to refer? 14 A. 15 3 Q. Yes. However, in order to put the matter straight you 16 were appointed under the Will of Mr. O'Shea to be 17 the Executor and Trustee of his Estate? 18 A. Of Mr. McGonagle. MS. MACKEY: 19 20 A. 21 4 Q. Mr. McGonagle. Yes . JUDGE O'LEARY: 22 Of Mr. McGonagle I should say? 23 A. Yes, I was. 24 Q. You were? 25 A. One of them. 26 Q. Yes. 27 A. That is right. 28 Q. Yes. 29 A. 0 'Reilly-Hyland. One of two of them I think? The other one being a Mr. 0 'Reilly-Hyland? 1 8 Q. 2 A. No. 3 9 Q. No? 4 A. No, I renounced my rights. 5 10 Q. You renounced your rights? 6 A. 7 11 Q. 8 A. His widow. 9 12 Q. His widow? 10 A. 11 13 Q. 12 A. 13 14 Q. 14 A. 15 15 Q. 16 A. 17 16 Q. 18 A. 19 17 Q. Did you exercise that power? Yes. Who in fact exercised the power? Barbara. Yes. As the heir at law is it? As the residual legatee. As a residual legatee? Yes. All right. Did you act in that matter? Yes. Yes, you did. In a professional capacity for him? Yes. One of the problems that we have had in dealing 20 with the case of Mr. McGonagle is that we have to 21 accept that the widow of Mr. McGonagle was only 22 very recently married to him? 23 A. 24 18 Q. That is true, yes. And she has sent us in various statements with 25 regard to her state of knowledge which we accept; 26 I mean from a practical viewpoint? 27 A. 28 19 Q. 29 A. Indeed. You are probably aware of those statements yourself? Yes, I am. 1 20 Q. 2 A. 3 21 Q. 4 A. 6 22 Q. 7 A. 8 23 Q. 9 A. 10 2 4 Q. 11 I mean from your own personal knowledge are we Well, I would have thought so. Yes? I mean she...(INTERJECTION). You...(INTERJECTION)? I mean...(INTERJECTION). From your own knowledge does she know anything about the situation? A. Well, I can never be certain but I know...(INTERJECTION). 13 14 25 Q. 15 A. 16 Of course I understand that? But I know Liam was an extraordinarily close, careful, prudent and secretive man. 17 26 Q. 18 A. 19 27 Q. 20 A. 21 28 Q. 22 A. 23 24 I am aware of them. wise to give credence to those do you think? 5 12 Yes? Yes? He didn't volunteer information to anybody. Yes? And least of all to his wife. Yes? Now, I mean I gleaned information over the years from time to time. 29 Q. 25 I understand. I was never told, you know? So, it is entirely consistent that she would not know anything really significant? 26 A. 27 30 Q. 28 A. 29 31 Q. It certainly is, yes. All right. We actually accept that? Yes. And we will of course reflect that in any decision 1 which we have to take; of course. 2 us in somewhat of a difficulty because it would 3 be not unfair to the late Mr. McGonagle to say that 4 his name crops up on a number of occasions through 5 the course of our investigation? 6 A. 7 32 Q. 8 A. 9 33 Q. 10 A. I haven't seen...(INTERJECTION). 11 34 Q. You have not seen it; all right? 12 A. 13 35 Q. That however puts Yes. Both as a solicitor and as an individual? Yes. I think that...(INTERJECTION)? I have seen some. All right. The problem which we are faced with is: 14 We must identify the clients of the Company we are 15 investigating? 16 A. 17 36 Q. 18 A. 19 37 Q. 20 A. 21 38 Q. 22 A. 23 39 Q. 24 A. 25 40 Q. 26 A. 27 41 Q. 28 29 Yes. Which is "Ansbacher"? Yes. We are not investigating Mr. McGonagle? Yes. We are not investigating you? Yes. We are not investigating anybody? Yes. We were investigating the Company? Yes. However, one of the jobs that has been given to us is that we must identify the clients of the Company. A. Right, yes, yes. 1 42 Q. 2 was a client of "Ansbacher" or not? 3 A. 4 43 Q. 5 A. 7 44 Q. 8 A. 9 He never told me. Yes? But I did obviously advise him in a number of and...(INTERJECTION). 11 45 Q. 12 A. 13 46 Q. 14 A. I do not want t o ...(INTERJECTION)? And also...(INTERJECTION). I do not want t o ...(INTERJECTION)? I also advised him. So, I am not sure if I can answer that. 15 47 Q. 17 I do not want any information which you got exclusively from giving him advice? 18 A. 19 48 Q. 20 A. 21 4 9 Q. 22 Yes. I do not want that information? Yes. That would be improper and I do not want that information? 23 A. 24 50 Q. 25 Yes. Other than that are you aware of any such connection? 26 A. 27 51 Q. 29 Do you know whether he was or not; directly or respects in connection with a visit to a Tribunal 10 28 Yes. indirectly? 6 16 Obviously, we have to consider whether Mr. McGonagle He would never have told me. Yes, yes. Do you know for example of the existence of a company called Camille Investments Ltd? 1 52 Q. 2 3 Yes. Had you any connection yourself with the Company? A. 4 No, no, but I knew it was an investment company of Liam's. 5 53 Q. 6 A. 7 54 Q. 8 A. 9 55 Q. Of Liam's? Yes. Did he own it himself? He did. He did, yes, yes. It may have been, the shares may 10 have been, in different person's names from time to 11 time but I think he was the beneficial owner at all 12 times ? 13 A. 14 56 Q. 15 A. 16 57 Q. 17 A. 18 58 Q. 19 A. 20 59 Q. 21 I would have thought so, yes. Yes? I don't think they were in anybody else's name. They may? But I may...(INTERJECTION). They may have been but...(INTERJECTION)? I mean I wouldn't necessarily know. Yes, yes. I will just show you a letter of the 30th March 1988, Exhibit 2? 22 A. 23 60 Q. 24 Yes. Which I think is Mr. McGonagle's own acknowledgement that he owns the Company? 25 A. 26 61 Q. Right, yes. Because obviously unless we know who owned the 27 Company we could not proceed on any basis 28 (Same Handed), Exhibit 3? 29 1 62 Q. 2 A. 3 63 Q. 4 It seems clear enough? Yes, it does, yes. And I mean I am just giving you an opportunity of looking at it? 5 A. 6 64 Q. 7 Yes, yes. In case you say, "That is all wrong. He only did that because of X, Y or Z"? 8 A. 9 65 Q. No. All right. There are two other pieces of evidence 10 which I want to put to you as a person who might 11 know something about it? 12 A. 13 66 Q. 14 Yes, yes. And, of course, I accept you might not also know anything about it as well? 15 A. 16 67 Q. Yes. However, I think in fairness to the late 17 Mr. McGonagle somebody had better be told about 18 these pieces of information because otherwise 19 it would be quite improper and I think you are 20 the appropriate person. 21 memo dated the 16th August 1978. 22 is "internal" it is internal to Guinness Mahon 23 Ireland (Same Handed)? 24 A. 25 68 Q. 26 When I say it Yes, yes. You may have already seen that in another context. I am not sure whether you have or not? 27 A. 28 69 Q. 29 There is an internal I probably have seen this before. You probably have seen it? 1 70 Q. There are three matters that I want to point out 2 to you there. 3 Mr. Turvey is to me? 4 5 A. 71 Q . 6 A. 7 72 Q. 8 A. 9 73 Q. 10 A. 11 74 Q . 12 A. 13 75 Q. 14 15 Mr. Turvey: Would you explain who He is a friend of Liam McGonagle's. Yes ? Was a friend, yes. Yes. Is he an accountant or is h e ...(INTERJECTION)? He is an accountant; he is. Is he? Yes. Yes? Though he has't ...(INTERJECTION). Has he a Haughey Boland background or...(INTERJECTION)? A. No, he hasn't. He has always -- I don't think he 16 has ever practised as a professional accountant. 17 He has always been in business. 18 76 Q. 19 A. 20 21 And -- but he was a friend of Liam's since -- from his school days. 77 Q. 22 Yes. He seemed to have carriage of a lot of matters relating to Camille Investments Ltd over the years? 23 A. 24 78 Q. 25 A. 26 79 Q. 27 A. 28 80 Q. 29 Yes? They were very friendly. Do you know that of your own knowledge? Well, they were friendly, you know? Yes? And...(INTERJECTION). However, do you know whether he had a lot of 1 A. 2 I think Liam would have relied on him from time to time, yes. 3 81 Q. 4 A. 5 82 Q. Yes? 6 A. Yes. 7 83 Q. 8 From time to time? Yes. There are two other matters I want to refer to you: Do you see the expression: 9 10 "This is a suitably secured situation"? 11 12 A. 13 84 Q. Yes. We have been informed by Guinness & Mahon that 14 "suitably secured" in that context means the 15 following: 16 it was being borrowed on a back-to-back basis 17 against money which was on deposit outside this 18 jurisdiction. 19 Ireland. 20 A. 21 85 Q. 22 A. 23 86 Q. 24 That may have been the North of It may have been the Channel Islands? Yes. Or it may have been the Cayman Islands? Yes. Do you know whether Camille Investments had any such money of your own knowledge? 25 A. 26 87 Q. 27 A. I would be very surprised if it had. Yes? I would be -- Camille Investments was an Irish company. 28 29 That money was being borrowed and 88 Q. Yes? 1 A. 2 So, I don't think Camille would have had any funds outside of the jurisdiction. 3 89 Q. 4 A. 5 90 Q. 6 A. 7 91 Q. Yes? But again I can't be certain. Yes, I understand? But I would be very surprised. If it was being backed by funds outside the 8 jurisdiction they were probably held in another 9 name? 10 A. 11 92 Q. 12 That's a possibility. Yes. Because you can see in the bottom that it says : 13 14 "In the meantime I have asked E.McL. to hold dollars in excess of 300,000.00 held on deposit from G.M.C.T to our order." 15 16 17 18 A. 19 93 Q. Yes. One of the conclusions the Inspectors might draw 20 from that and of course they can be persuaded to 21 draw a different conclusion if that is appropriate? 22 A. 23 94 Q. Yes, yes. One of the conclusions they might draw from it is 24 that Camille Investments and its owner had access 25 to backing deposits in Guinness Mahon Cayman Trust, 26 which was an earlier name of "Ansbacher". 27 have any information to confirm or dissuade us from 28 adopting that course of action? 29 Do you 1 2 95 Q 3 I am not interested in the privileged information. Other than privileged information...(INTERJECTION)? 4 A 5 96 Q 6 A 7 97 Q 8 A 9 98 Q 10 A 11 I am...(INTERJECTION). You can forget you know privileged information? I am...(INTERJECTION). Forget that? I ...(INTERJECTION). You do not know? I know I have come across the phrase "suitably secured" on many occasions. 12 99 Q 13 A 14 100 Q 15 A Yes ? I know how Guinness & Mahon interpret that phrase. Yes? I am not sure that it was always interpreted -­ 16 it always reflected the actual position. 17 come across situations where I think it might have 18 been convenient for Mr. Traynor to say to his 19 lending committee, 20 101 Q 21 A Yes, I understand. I have "This is adequately secured". Yes? Whereas in fact it wasn't but he would have known 22 the borrower and would have been quite happy. 23 I cannot give you any instances off the top of my 24 head of that but I certainly have come across one 25 or two instances of that. 26 102 Q Yes. Now, However, Mr. O'Shea, that line of "Defence" 27 hardly passes muster in this case when in the course 28 of the same memo there is a specific request? 29 A 1 103 Q 2 To set aside 300,000 US dollars, presumably US dollars, which are apparently in G.M.C.T? 3 A 4 104 Q 5 Indeed. So, I think that "Defence" which might be open to some people hardly applies to this document? 6 A 7 105 Q 8 Right, indeed. You see the point I am making; that is all I am saying? 9 A 10 106 Q I see the point you are making of course. All right, grand. The third piece of evidence 11 that we have which would indicate a connection 12 between Camille Investments Ltd and "Ansbacher", 13 and therefore of course indirectly with 14 Mr. McGonagle, is a memo dated or a letter dated 15 the 11th March 1990 from Mr. Lanigan-0'Keeffe to 16 Mr. Traynor and there is a Schedule attached to 17 that. 18 Mr. O'Shea, I am treating you as a solicitor in 19 this regard: I am going to give you the complete 20 document which includes the names of other people 21 (Same Handed), Exhibit 4? 22 A 23 107 Q 24 Certainly, you can take that...(INTERJECTION). However, I mean you have to undertake to me not to...(INTERJECTION)? 25 A 26 108 Q 27 A 28 109 Q 29 I think in the case of Mr. O'Shea you can -­ Yes . To abide by confidence in that regard? Yes, yes. Mr. Lanigan-0'Keeffe has informed another person, and will in due course no doubt inform us also, 1 that this Schedule was produced by him for 2 Mr. Traynor and it was a Schedule of "suitably 3 secured" loans? 4 Yes . 5 110 Q 6 Persons who had loans through "Ansbacher" that were "suitably secured"? 7 A 8 111 Q 9 Yes, yes. And they included a number of persons including Liam McGonagle? 10 A 11 112 Q 12 A 13 113 Q 14 A 15 114 Q 16 A Yes, yes. All right? Yes, clearly the case, yes. Yes? Yes . Have you any comment to make on that? It could be for a number of factors. I can't -­ 17 obviously it would be speculation -- I think you 18 can speculate; I think may be correctly. 19 seen a number of these (indicating), Exhibit 4. 20 115 Q 21 A 22 116 Q 23 A 24 117 Q 25 A 26 118 Q 27 A 28 119 Q 29 I have I can only go on what Mr. Lanigan-0'Keeffe says? Yes . That is all I can go on? Yes . Because I ...(INTERJECTION)? Yes . It means nothing to me. All it is is a Schedule? Yes, yes. If Mr. Lanigan-0'Keeffe said to me, which I anticipate he will not because he has said it 1 differently to another person, but if he in due 2 course says to me, "Well, I don't know what 3 that list is"? 4 5 120 Q. 6 Well, then I will have to take it to out of my reckoning; do you understand? 7 A. 8 121 Q. 9 Yes. However, if he says what I anticipate he is going to say? 10 A. 11 122 Q. Yes, yes. There can be only one conclusion surely; that 12 conclusion is that Mr. Lanigan-0'Keeffe 13 thought that...(INTERJECTION)? 14 A. 15 123 Q. 16 A. 17 124 Q. 18 19 That these were...(INTERJECTION). That Mr. McGonagle had a "suitably secured" loan? Indeed, yes. Whether that proves it or not; that is a matter of judgment afterwards? A. 20 This was a list of facilities made available by Guinness & Mahon to the individuals. 21 125 Q. 22 A. 23 126 Q. 24 A. 25 127 Q. 26 A. 27 128 Q. With backing? With...(INTERJECTION). To "Ansbacher"? Yes. As you will appreciate...(INTERJECTION)? Yes. As you will appreciate if you look at the date, 28 the 11th May 1990, it can hardly be anything else? 29 MR. BARRY: That is a question you 1 are asking, Michael, or 2 is that a statement you are making? 3 Well, I am...(INTERJECTION). 4 MR. BARRY: Are you saying that that is a list (indicating), 5 6 Exhibit 4? 7 A 8 129 Q 9 A 10 11 I am assuming it is a list. JUDGE O'LEARY: A 14 So, it is a question? Yes, right. Yes . M R . BARRY: It sounded like a statement; sorry. 15 16 It is a list? Yes . M R . BARRY: A Yes. It is a list, yes. M R . BARRY: 12 13 Well, no. A 17 Yes . JUDGE O'LEARY: I think coaching the witness is neither 18 19 ethical. 20 M R . BARRY: Excuse me; I am sorry. 21 JUDGE O'LEARY: Or certainly necessary. 22 M R . BARRY: Excuse me. 23 JUDGE O'LEARY: With an expert witness like this. 24 25 26 130 Q M R . BARRY: Sorry. JUDGE O'LEARY: However, the reality of the situation as you 27 28 29 will appreciate? A Yes. 1 131 Q 2 longer had any connection with Guinness & Mahon? 3 A 4 132 Q 5 That is right. And he is addressed in the letter as being Mr. J. D. Traynor of "Ansbacher" Limited? 6 A 7 133 Q 8 Yes . So, we can take it that it has an "Ansbacher" connection? 9 A 10 134 Q 11 12 Is that on the 11th May 1990 Mr. Traynor no I ...(INTERJECTION). We can take it that Mr. Lanigan-0'Keeffe thought it had an "Ansbacher" connection? A 13 Thought -- well, perhaps he did, yes. Perhaps he did. 14 135 Q 15 A Yes. That is a matter that...(INTERJECTION)? Now, I know from talking to Liam that Liam had 16 always had the assets of Camille securing any 17 borrowings he had personally. 18 136 Q 19 A 20 Yes ? And including also the Deeds to No. 29 Molesworth Street. 21 137 Q 22 A 23 All right? And insofar as Liam was concerned that was security that they held. 24 138 Q 25 A Yes, I understand that? And if there was anything in "Ansbacher" it wasn't necessary. 26 27 139 Q 28 A 29 140 Q That may well be the case? Now...(INTERJECTION). 1 2 141 Q 3 A But certainly No. 29 Molesworth Street -- I am 4 not sure had it been sold at that time or not but 5 it was substantially more than the borrowing than 6 was there 7 figure there (indicating), Exhibit 4, and I think 8 also the other assets of Camille would have been in 9 the region of a few hundred thousand pounds. (indicating), Exhibit 4, or the borrowing They 10 were basically investments and again they would have 11 been there as security. 12 or what other records Guinness & Mahon might have 13 in relation to that type of security. 14 142 Q 15 A So, I don't know what else Yes? And whether they would have considered that to 16 be adequately secured or not but I mean I hear 17 what you are saying, yes. 18 143 Q 19 You can take it that their evidence to us has been that adequately secured means offshore? 20 A 21 144 Q 22 A 23 145 Q 24 A 25 146 Q Yes, offshore, yes, yes. It does not necessarily mean Cayman? Yes . However, it means offshore? Yes, yes. All right. The last thing I want to show you in 26 the Camille mode of this is a document signed by 27 yourself apparently (Same Handed). 28 signature (indicating), Exhibit 5? 29 Is that your 1 147 Q 2 A 3 148 Q 4 I have no idea. Whose signature is it underneath? There appear to be two signatures on it? 5 A Yes. That is Des Turvey's signature. 6 149 Q Yes. That is the one which we have seen in many 7 documents dealing with Camille? 8 A 9 150 Q 10 And we will of course in due course deal with that with Mr. Turvey? 11 A 12 151 Q 13 A 14 And that is Mr. Turvey. Who were not the auditors? No. I haven't seen the Company's file. Was I a Director at some stage of Camille? 15 152 Q 16 A 17 153 Q 18 A 19 154 Q 20 A 21 155 Q 22 23 Yes . I do not know? Yes . I am asking you? I honestly...(INTERJECTION). You told me you had nothing to do with the Company. I have...(INTERJECTION). And I am just saying to you that I have come across this document A 24 (indicating), Exhibit 5? I have no idea what -- why my signature is there (indicating), Exhibit 5. 25 156 Q 26 A 27 157 Q 28 A 29 158 Q I wonder if you would have a look at it yourself? Yes . And if you can come up with any explanation? Yes . That would be of assistance to us? 1 2 159 Q 3 A Yes. It is clearly a request to the bank to provide 4 information to Haughey Boland but I cannot tell you 5 in what capacity I signed that 6 Exhibit 5. 7 160 Q 8 Do you see that the document itself says you signed as an authorised signature? 9 A 10 161 Q 11 A 12 162 Q 13 Yes . Were you an authorised signature for that Company? I don't believe so. Yes. I have come across no information that you in fact were an authorised signature of the Company? 14 A 15 163 Q 16 A 17 164 Q 18 19 (indicating), Yes . However, I wonder would you look at it? Yes . And see whether there is any further information you can give us as a result of your investigations? A 20 I will certainly check to see was I a Director at that stage. 21 165 Q 22 A 23 16 6 Q 24 A 25 167 Q 26 Exactly? Yes . I wonder would you do that? Yes, yes. I think it would be of assistance to us if you did that? 27 A 28 168 Q 29 A Certainly, yes. All right? 1 Thank you. 2 Mr. McGonagle's involvement in any other 3 companies with "Ansbacher" connections other 4 than in a . ..(INTERJECTION)? 5 A 6 170 Q 7 A 8 Professional? Yes; professional capacity? I don't think so. Other than in a professional capacity, no. 9 171 Q 10 A 11 172 Q 12 A 13 173 Q 14 A 15 174 Q 16 A No. 17 175 Q No? 18 A 19 176 Q 20 Yes. I am not interested...(INTERJECTION)? Not that I -­ Yes ? I mean a number of companies have come up certainly. Yes? If you...(INTERJECTION). Was he involved in a company called Pine Securities? He wasn't. Was he involved in a company called Beresford Investments ? 21 A 22 177 Q 23 24 Do you know anything about I believe he was. Yes. Were you involved in the Company called Beresford Investments? A No, but I remember it through the office. I 25 think it bought and sold a property and I think 26 lost a small amount of money in the process. 27 178 Q 28 29 Yes. Do you know who the beneficial owners of that Company were? A 1 2 A. 3 180 Q. 4 A. 5 181 Q. Including, yes. Yes. Were you a beneficial owner of the Company? No. That also, according to the records of GMI and 6 that is all I am talking about is the records 7 of GMI? 8 A. 9 182 Q. 10 A. 11 183 Q. 12 A. 13 184 Q. Yes. Had a "suitably secured" loan? Yes, I have seen those. You have seen those? Yes. I have no knowledge as to what that "suitably 14 secured" loan was. 15 as I have in the case of the previous one that I put 16 to you; do you understand? 17 A. 18 185 Q. 19 A. 21 186 Q. 22 A. 23 187 Q. 24 A. 25 188 Q. 26 A. 27 29 Yes. Yes. Were you familiar with a company called British Isle Investments? 20 28 I do not have the same knowledge I have heard the name. Yes. Were you an owner of that Company yourself? No. Had you any interest in the Company? None, none. Did Mr. McGonagle have an interest in the Company? That would be again information I would have gleaned from Mr. McGonagle. 189 Q. In a professional capacity? 1 190 Q. 2 A. 3 191 Q. 4 A. 5 192 Q. 6 Other than that I wouldn't know. You would not know? No, I wouldn't know. However, British Isle Investments Company or whatever the precise name of it was? 7 A. 8 193 Q. 9 A. 10 194 Q. 11 A. 12 195 Q. 13 A. 14 Yes. Was a very famous Company? Yes. I mean it had been the subject of much speculation? Indeed. I think I ...(INTERJECTION). So, I mean it is not just like a . ..(INTERJECTION)? I think I -- yes, I think I know what you are referring to. 15 196 Q. 16 A. 17 197 Q. 18 A. 19 198 Q. 20 Yes. In the United Kingdom? That is right, yes. There was a company investigation? There was. And British Isle Investments was at the very centre of that company investigation? 21 A. 22 199 Q. 23 24 However, other than that information? Yes, that is right. Surely at that time quite separate from any advice which you gave him in later life...(INTERJECTION)? A. 25 Well, I remember a little bit about that. There were two UK -­ 26 200 Q. 27 A. Yes? There were two British property developers that 28 Liam had a business relationship with. We -- I 29 think they were involved in a US public -- sorry, 1 a UK company called Norwest Holst Ltd and I think 2 it was in that context that the inquiry arose but 3 I didn't know -- I never knew the details of the 4 inquiry. 5 201 Q 6 7 I can assure you I have no interest in the details of the inquiry? A I know there was a suggestion that in some way 8 they had taken money out of Norwest Holst and -­ 9 but I never knew the...(INTERJECTION). 10 202 Q However, was not the fact of Mr. McGonagle and 11 this British Isle Investments Company central 12 to the issue to be deciding in that inquiry 13 in England and did they not come to Dublin to 14 interview Mr. McGonagle? 15 A 16 I wasn't aware of that. I thought he hadn't been interviewed but...(INTERJECTION). 17 203 Q 18 A 19 204 Q 20 No, he had not? Yes . Because when they came to Dublin he refused to be interviewed? 21 A 22 205 Q 23 A I see, I see. All right. However, you surely must have known that? It is just that I have heard the name but whether 24 it was a company that was solely controlled by 25 these two English property developers or with 26 Liam McGonagle I don't know. 27 Yes? 28 It -- I am not sure what the results of the 29 inquiry were either but the...(INTERJECTION). 1 207 Q. 2 3 Yes, I see. However, you do not know anything about that Company as such? A. 4 Other than in the context of professional advice, no. 5 208 Q. 6 A. 7 209 Q. 8 A. 9 210 Q. Yes? I mean I was aware vaguely of the inquiry. Yes? But I can't say I know anything about it. Yes. On the question of professional advice: 10 Ms. Cummins mentions to me, and it is quite true, 11 that the recent law on that matter seems to 12 differentiate between information which a solicitor 13 gets while acting for a Client with regard to who 14 owns a company on the one hand? 15 A. 16 211 Q. 17 Yes. And the advice that he or she tenders to that person arising from that consultation? 18 A. 19 212 Q. Yes. And that all seems to have come down in favour of a 20 solicitor not being able to exercise privilege with 21 regard to information with regard for example to the 22 ownership of a company? 23 A. 24 213 Q. 25 A. 26 Is that not the current state of the law? I thought it was -- I mean I bow to your knowledge in that regard, Judge. 27 214 Q. 28 A. 29 Well, I think they...(INTERJECTION). Yes? But I did look at Judge Kelly's decision in the Miley -v- Miley case and he clearly said there you 1 cannot -- you must disclose the name of your client. 2 215 Q 3 A Yes ? And he decided, or he confirmed I think the legal 4 position, that legal assistance isn't privileged. 5 Legal advice is, which I think is the sort of 6 language he used. 7 216 Q 8 Any way, Mr. O'Shea, I am not going down that road; I can assure you? 9 A 10 217 Q Yes . Because with regard to Mr. McGonagle I certainly 11 have enough information to be able to make a 12 decision whether or not he was a client of 13 "Ansbacher"? 14 A 15 218 Q Okay, indeed. I may be a bit deficient with regard to being 16 able to precisely define the extent to which he 17 was a client? 18 A 19 219 Q Okay, yes. However, I do not think that is sufficiently 20 important to my investigation of "Ansbacher" 21 for me to go to the scaffold over it? 22 A 23 220 Q 24 A 25 221 Q Indeed, yes. Do you understand what I mean? Indeed. If it was necessary and if it was a matter of 26 life or death I would pursue the matter further 27 with you but I am not interested in pursuing 28 the matter further with you at this stage for 29 that reason? 1 2 222 Q All right? 3 A Thank you. 4 223 Q 5 I come now to the question of the relationship between "Ansbacher" and your company? 6 A 7 224 Q 8 A 9 225 Q 10 A 11 226 Q Yes . A firm of solicitors? Yes . And we have received your statement in that regard? Yes . And it is helpful and thank you very much indeed 12 for the statement, Exhibit 6 . 13 assistance to us. 14 for Cayman International Bank & Trust Company 15 Limited, which was another of the names of 16 "Ansbacher"? 17 A 18 227 Q It is of considerable We know that your company acted Yes . And really we are not interested in that. We 19 really have no concerns with regard to that. 20 You are entitled to act for those people if 21 you want. 22 1993 situation? 23 A 24 228 Q However, we are interested in the Yes . About this fee apparently that was paid by a UK 25 Client of the firm. 26 approximately? 27 A 28 229 Q 29 What was the amount of that I do not want the...(INTERJECTION)? Approximately £40,000. £40,000, yes. somewhere? Do you know how long it was invested 1 I would hazard a guess and say a number of months; 2 may be up to five or six months perhaps. 3 230 Q 4 A 5 231 Q Yes ? May be shorter. Yes. If I was to tell you that our information is 6 that it was in Hamilton Ross rather than Kentford 7 would you know whether that is right or wrong? 8 A 9 232 Q 10 A 11 233 Q 12 I won't. Yes ? I know the payment came from Kentford. Yes. However, I think Kentford was merely a device used for making payments? 13 A 14 234 Q 15 A 16 235 Q 17 A 18 236 Q 19 A 20 237 Q 21 May be so, yes. Do you understand? May be so, yes. It was not an investment vehicle? Yes, yes. Insofar as we have been able to ascertain? Yes . Kentford was the mechanism by which money was paid to Irish people? 22 A 23 238 Q 24 Yes . From money which had been abroad; do you understand what I mean? 25 A 26 239 Q 27 A 28 240 Q 29 A Yes, I do, yes. Yes. That was...(INTERJECTION)? I do, yes. So, as far as you were concerned it was Kentford? Yes . 1 24 1 Q. Do y o u r e m e m b e r t h e c i r c u m s t a n c e s 2 p u t w h e r e - e v e r it w a s p u t ; 3 m o m e n t w h e r e it w a s p u t ? 4 A. 5 242 Q. 6 A. 7 24 3 Q. 8 A. 9 244 Q. 10 A. 11 24 5 Q. 12 A. 13 2 4 6 Q. 14 i n w h i c h it w a s l e a v i n g aside for the I t h i n k it w a s p r o b a b l y L i a m ' s idea. Yes? T o r o u t e it t h r o u g h De s T r a y n o r . Yes? A n d L i a m p o s s i b l y m e n t i o n e d it t o me. Yes? I n a n y e v e n t it h a p p e n e d . Yes? A n d subsequently payments were made by Kentford. Yes. W e r e y o u f a m i l i a r at t h a t t i m e w i t h w h e r e it was going yourself? 15 A. 16 247 Q. 17 A. 18 248 Q. No, I h a d no id ea. Y o u h a d no i d e a ? I h a d n o idea. W h e n y o u s a y it w a s "D es T r a y n o r " d o y o u t h i n k 19 it w a s c o m i n g t o D e s T r a y n o r in I r e l a n d o r it 20 w a s c o m i n g to De s T r a y n o r w h e r e ? 21 A. 22 24 9 Q. 23 A. W e l l ... ( I N T E R J E C T I O N ) . Or di d you know? Obviously, I k n e w o f D e s 1s c o n n e c t i o n w i t h 24 Guinness 25 as to w h a t o t h e r b a n k i n g c o n n e c t i o n s h e had. 26 Obviously, 27 Guinness 28 29 25 0 Q. & Mahon. I d i d n ' t g i v e it a n y t h o u g h t at t h a t t i m e h e w a s n o l o n g e r in & Mahon. I m e a n he h a d l e f t G u i n n e s s for five years? & M a h o n at t h a t s t a g e 1 T h a t is tru e, 2 was h a p p y to f a c i l i t a t e L i a m a n d d i d a n d I d i d n ' t 3 r e a l l y t h i n k v e r y m u c h a b o u t it o n e w a y o r t h e 4 other. 5 Yes. 6 or n o t -- it w a s t h e n e v e n t u a l l y b r o u g h t i n t o t h i s 7 Country. 8 w a s it, 9 A 10 252 Q t h a t is tru e, You are not b u t i n a n y e v e n t he familiar, a r e you, with whether The m o n e y was b rought into this Country, a nd d i s t r i b u t e d b e t w e e n you? It w a s d i s t r i b u t e d to t h e p a r t n e r s , A n d w h e r e d i d it e n d u p ? it was. D i d it e n d u p i n t h e f i r m ' s a c c o u n t o r w h e r e d i d it e n d u p ? 11 12 A 13 25 3 Q 14 A 15 254 Q 16 A 17 25 5 Q 18 A 19 256 Q No, it e n d e d u p in t h e p a r t n e r ' s a c c o u n t . I n . . . (INTERJECTION)? Individually. W i t h i n the firm? Individually. Individually? Yes, individually. Individually, yes, I see. W a s it e x p e c t e d t h a t t h e 20 partners would make whatever returns were necessary 21 a r i s i n g out of that? 22 A Yes . 23 257 Q Yes ? 24 A Well, 25 258 Q Yes ? 26 A Yes . 27 259 Q 28 29 if t h e y w e r e d o i n g it, yes. A n d was this m o n e y earned abroad o r . . . (INTERJECTION)? 1 26 0 Q 2 A Yes, it w a s a U K C l i e n t as I r e c a l l . 3 26 1 Q Yes, I see, 4 I see. Do y o u r e m e m b e r t h e t i m e of t h e y e a r in 1 9 9 3 t h a t y o u r e c e i v e d t h a t m o n e y ? 5 A 6 262 Q 7 A 8 26 3 Q Yes? 9 A Yes, I don't remember. I w o n d e r c o u l d you find that out for us? I could. I could. I t h i n k t here m a y be some correspondence. 10 11 264 Q 12 A 13 26 5 Q 14 A 15 2 66 Q Yes. Well, t h a t is f a i r e n o u g h ? B u t I w i l l c e r t a i n l y s e e if I c a n f i n d t h a t out. Yes. T h a t w o u l d b e of a s s i s t a n c e t o u s ? Yes . It a l w a y s s e e m s t o us t h a t t h e r e w a s a s m a l l b a l a n c e 16 r e m a i n i n g in H a m i l t o n R o s s a f t e r t h e p a y m e n t w a s 17 m a d e e v e n as l a t e as t h e 3 1 s t D e c e m b e r 18 s o m e £ 1 , 2 4 0? 19 A I t h i n k t h e r e was. 1 9 9 3 of I think that m a y have been interest. 20 21 267 Q 22 A 23 268 Q At a later date? 24 A A t a l a t e r date. 25 269 Q 26 Yes? W h i c h was s u b s e q u e n t l y d i v i d e d again. Yes. I w o n d e r w o u l d y o u j u s t g i v e us t h e d a t e s of t h o s e ? 27 A 28 27 0 Q 29 A Certainly. It w o u l d b e o f c o n s i d e r a b l e a s s i s t a n c e t o u s ? 1 27 1 Q 2 A 3 272 Q Okay. Thank you ve r y m u c h indeed. T h a t is g r a n d . 4 H a v e I -- f r o m t i m e t o t i m e -- as y o u s a y in 5 your statement, 6 respected the firm and I am not c o n c erned about 7 that N o v e m b e r 1993 i n s t r u c t i o n that you received. 8 H a d y o u e v e r a c t e d fo r t h e F i r m b e f o r e t h a t ? Exhibit 6: 9 A No, not to m y knowledge. 10 27 3 Q No, not to y o u r k n o w l e d g e ? 11 A 12 274 Q 13 Yes . I see, ok ay. Had you e ver r e c e i v e d m o n e y f rom the Firm before that? 14 A 15 27 5 Q No. A ll right. W e ha v e , I h av e , 16 t o s h o w you. 17 it s f r a i l t y to y o u b e c a u s e 18 claims 19 you will appreciate. 20 Ms. 21 A 22 276 Q 23 A 24 277 Q 25 O n e r e a l l y is a n d I w a n t t o e x p l a i n for doc u m e n t s that Cummins, two other documents please I do not like m a k i n g I c a n n o t s t a n d over, (Same H a n d e d ) , Exhibit A 27 278 Q f r o m Mr. T r a y n o r t o Mr. A O'Dwyer? Yes . T h e y w e r e b o t h w o r k i n g in G u i n n e s s & M a h o n at Yes . O n t h e f a c e o f it it l o o k s j u s t l i k e a Guinness 28 7? Thanks. T h i s is a m e m o as T h i s is a d o c u m e n t at p a g e 28, the time? 26 29 On one o c c a s i o n you & Mahon payment? 1 2 7 9 Q. T h e r e a r e h o w e v e r if y o u l i k e t w o a s p e c t s of 2 the m a t t e r w h i c h give r i s e to some p o s s i b i l i t y , 3 a n d I a m n o t p u t t i n g it a n y s t r o n g e r t h a n that, 4 of a n " A n s b a c h e r " 5 t h a t it w a s a s t e r l i n g d r a f t ? 6 A. 7 28 0 Q. connection. O n e is t h e f a c t Yes. W h i c h w a s a l i t t l e u n u s u a l if t h e m o n e y w a s 8 i n I r e l a n d in o r d i n a r y c i r c u m s t a n c e s , 9 Redshank Investments. A. I h a v e h e a r d of t h a t a g a i n in a p r o f e s s i o n a l capacity, 12 13 H a v e y o u h e a r d of t h a t Company? 10 11 28 1 Q. Yes. yes. That R e d s h a n k Investments, 14 believe, 15 Inspectors believe that? 16 A. 17 282 Q. 18 A. 19 28 3 Q. the Inspectors had a connection with McGonagle. The Yes. W e a r e n o t a s k i n g y o u to c o n f i r m or d e n y t h a t ? Yes. A n d t h a t it m a y w e l l h a v e h a d a n " A n s b a c h e r " connection? 20 21 A. 22 284 Q. 23 A. 24 28 5 Q. 25 A. Yes. Do y o u k n o w a n y t h i n g a b o u t t h a t p a y m e n t ? I h a v e a v a g u e m e m o r y I h a v e to say. Yes? B u t o n l y t h at. I c a n ' t s a y i n w h a t c o n t e x t it is. 26 The o ther p e o p l e n a m e d w ere p a r t n e r s 27 So, 28 was made but 29 and secondly 2 8 6 Q. i n t h e firm. it m a y b e in t h a t c o n t e x t t h a t t h i s p a y m e n t I cannot...(INTERJECTION). It is l i k e as i f it is a d i v i s i o n of s o m e m o n e y 1 between partners 2 s e c t i o n g o i n g to R e d s h a n k s ? 3 Indeed. 4 287 Q 5 A 6 288 Q in t h e F i r m w i t h Mr. Is t h a t n o t w h a t it l o o k s l i k e ? Indeed. The source of that fund, 7 c a u s e o f c o n c e r n to us. 8 think about that? 9 A 10 289 Q 11 A 12 29 0 Q 13 A 14 29 1 Q 15 A 16 292 Q 17 A 18 29 3 Q 19 A 20 294 Q 21 A 22 29 5 Q M c G o n a g l e 's I wi l l , o f t h o s e fu n d s , are a I wonder w o u l d you yes. A n d w o u l d y o u r e v e r t t o us w i t h r e g a r d t o t h a t ? Yes, I wi l l . I do not want t o ...(I N T E R J E C T I O N ) ? I c a n ' t r e c a l l now. Yes, I understand? Yes . I understand that? Yes . However, it m a y b e w o r t h w h i l e t h i n k i n g a b o u t i t? Yes . All right? Certainly. T h e d i f f i c u l t y a b o u t t h i s p a y m e n t as f a r as w e a r e 23 c o n c e r n e d is t h a t it m e n t i o n s y o u b y n a m e r a t h e r 24 than the Firm? 25 A 26 296 Q Indeed, yes. O f c o u r s e w e h a v e to b e v e r y c a r e f u l a n d w e w i l l 27 be v e r y c areful a nd c e r t a i n l y we will be v ery 28 c a r e f u l i n r e s p e c t of a n y p a y m e n t of £ 1 , 6 5 0 ? 29 A 1 297 Q 2 A 3 298 Q W h i c h is n o t e v e n i n 19 84 a n a m a z i n g s u m o f m o n e y ? Yes . However, at t h e s a m e t i m e w e h a v e t o s a t i s f y 4 o u r s e l v e s t h a t it d o e s n o t h a v e a n " A n s b a c h e r " 5 connection? 6 A 7 299 Q 8 A 9 30 0 Q Yes, So, indeed. a n y a s s i s t a n c e y o u c a n g i v e us i n t h a t r e g a r d ? Fine, yes. O t h e r w i s e w e m a y h a v e to go a n d i n v e s t i g a t e it. 10 W e h a v e n o t r e a l l y i n v e s t i g a t e d it t h a t m u c h at 11 this stage? Yes, okay. 12 A 13 30 1 Q 14 A 15 302 Q 16 A 17 30 3 Q 18 19 A 20 304 Q However, if y o u c a n s a t i s f y us so b e i t? V e r y w el l . W e w i l l j u s t le t it s t a n d at th a t ; all right? Certainly. A l l right. T h a t is o n e -- y o u m i g h t c o m e b a c k to us o n tha t, Mr. Yes, O'Shea? I wi l l . T h e o t h e r t h i n g is this: I wo n d e r w o u l d you just 21 s h o w Mr. O ' S h e a n u m b e r 29 as w e l l 22 Exhibit 23 I n v e s t m e n t s as b e i n g a C l i e n t o f C o l l e g e T r u s t e e s . 24 Y o u c a n t a k e it t h a t at t h a t s t a g e o u r i n f o r m a t i o n 25 is t h a t C o l l e g e T r u s t e e s ' 26 of t h e m b u t m a n y o f t h e C o l l e g e T r u s t e e s ' 27 w h i c h t h e y h a d i n v e s t e d for clients, were routed 28 for some i n e x p l i c a b l e re a s o n t h r o u g h "Ansbacher"? 29 Yes, 8? I see. (Same H a n d e d ) , T h a t h a s -- t h a t s h o w s R e d s h a n k f un ds , not n e c e s s a r i l y all funds 1 So, here you h ave a s it u a t i o n w here we k now that 2 R e dshank Investments Limited was a College Trustee 3 client. 4 a f t e r tha t, 5 r e g a r d to t h e R e g i s t e r e d O f f i c e a n d w e k n o w t h a t 6 R e d s h a n k I n v e s t m e n t s is c o n n e c t e d w i t h t h e 1984 7 payment. 8 m a t h e m a t i c a l l y p r o v e it at t h i s s t a g e t h a t R e d s h a n k 9 I n v e s t m e n t s w a s a L i a m M c G o n a g l e c o m p a n y b u t we W e k n o w t h a t in 1985, which was the year it h a d i n f o r m e d v a r i o u s p a r t i e s w i t h We are of the b e l i e f but we cannot 10 b e l i e v e t h a t to b e t h e case . 11 t hose t hings t o g e t h e r we h a d a c e r t a i n co ncern? 12 A 13 306 Q 14 P u t t i n g a l l of Yes . A n d I w i l l n o t p u t it a n y s t r o n g e r t h a n t ha t ; all right? 15 A 16 307 Q Yes . The o n l y o t h e r doc u m e nt 17 Mr. 18 document. 19 A 20 308 Q 21 A 22 309 Q 23 A 24 31 0 Q O'Shea, is t h is : I w a n t t o s h o w you, It is a 1 8 t h M a y 19 92 It is p a g e 30 (Same H a n d e d ) , Exhibit 9? T h a t d o e s n o t a p p e a r in y o u r s t a t e m e n t , Exhibit 6? Thanks. No, a n d I h a v e no r e c o l l e c t i o n of it. Yes? I h a v e n o i d e a w h a t it is for. I w o n d e r w o u l d it b e an e a r l i e r p a r t of t h e £ 4 0 , 0 0 0 25 e ven t h o u g h the £40,000 was there in D e c e m b e r 1992? 26 C o u l d it h a v e b e e n £ 5 0 , 0 0 0 a n d c o u l d t h i s b e £ 1 0 , 0 0 0 27 of it? 28 29 A I d o n ' t t h i n k so. 1 2 312 Q 3 f r o m tha t . that they are talking about 4 A 5 31 3 Q 6 A 7 314 Q Yes, Y ou do note "Ansbacher" Limited? I do. Rather than Hamilton Ross? Yes . However, y o u c a n t a k e it t h a t H a m i l t o n R o s s a n d "Ansbacher" were interchangeable? 8 9 A 10 31 5 Q 11 A 12 316 Q 13 Indeed, yes. Names used by these parties? Yes, indeed, yes. A n d I w o u l d n o t a t t a c h t o o m u c h s i g n i f i c a n c e to that ? 14 A 15 317 Q 16 Yes . However, Mr. 17 A 18 318 Q 19 A y o u c a n s e e t h a t it is a p a y m e n t n o t to McGonagle? Yes, Kennedy McGonagle Ballagh. But to K e n n e d y M c G o n a g l e Ballagh? Yes, I c a n se e t h a t . I can see that. I am - ­ I h a v e n o i d e a w h a t for. 20 21 Y o u t h i n k it is s e p a r a t e 319 Q I wonder could you investigate that? T h e r e is b o u n d to b e a r e c o r d of t h a t s o m e w h e r e ? 22 23 A 24 32 0 Q 25 A Yes. 26 32 1 Q Yes? 27 A 28 322 Q 29 A Yes . It is o n l y 1 9 9 2 ? Yes, I agree. I agree. I w o n d e r c o u l d y o u g i v e us a n e x p l a n a t i o n o f t h a t ? Certainly, o k a y. 1 32 3 Q 2 A None. N o t at t h i s p o i n t in t i m e a n y w a y I d o n ' t 3 b u t I c e r t a i n l y w i l l -- I m e a n w e c a n c h e c k o u r 4 l e d g e r s a n d find out from that; 5 o u t f r o m tha t. 6 324 Q 7 Y o u se e c o u l d I e x p l a i n w h e r e w e a r e g o i n g , Mr. 8 A 9 32 5 Q 10 A 11 326 Q O'Shea? Yes, yes. So t h a t e v e r y b o d y u n d e r s t a n d s w h e r e w e a r e ? Yes . W e w i l l h a v e to c o n s i d e r a l l t h e e v i d e n c e as to w h e t h e r Mr. 12 13 A 14 327 Q h o p e f u l l y find M c G o n a g l e was a C l i e n t of " A n s b a c h e r " ? Yes . O b v i o u s l y I cannot tell you what the result of that conclusion will be? 15 16 A 17 328 Q Yes . However, le t us a s s u m e f o r a w o r k i n g h y p o t h e s i s at 18 the m o m e n t that we c o n c l u d e d that he was a C l i e n t 19 of " A n s b a c h e r " ? 20 A 21 329 Q Yes, yes. W e t h e n h a v e to s e p a r a t e l y c o n s i d e r w h e t h e r 22 K e n n e d y M c G o n a g l e B a l l a g h w e r e C l i e n t s of 23 "Ansbacher"? 24 A 25 33 0 Q 26 A 27 33 1 Q 28 A 29 332 Q Yes . It is a s e p a r a t e c o n s i d e r a t i o n ? Yes . A n d we are h i g h l y cons c i o u s of that? Yes . 1 2 33 3 Q 3 So, t h a t is w h y w e a r e p a r t i c u l a r l y h o n i n g in on this 4 A 5 334 Q 6 A 7 33 5 Q (indicating), Exhibit 9? A n d w e c a n c o m e b a c k t o y o u o n that . Yes ? I w i l l c o m e b a c k t o y o u o n tha t. Yes. All right. That w o u l d be great. I wonder w h e n y o u a r e c o m i n g b a c k t o us o n t h a t ? 8 9 A 10 336 Q Yes . W o u l d y o u do u s t h e c o u r t e s y o f w h e n y o u a r e 11 w r i t i n g t o us in t h e l e t t e r w o u l d y o u p u t a n o t e 12 at t h e b o t t o m o f t h e l e t t e r t o s a y that , 13 c a n b e i n c l u d e d as p a r t o f m y s w o r n t e s t i m o n y " ? 14 A 15 337 Q 16 A 17 338 Q 18 "This Sure . Do y o u u n d e r s t a n d t h a t ? Yes, yes. T h a t w i l l e n a b l e us t h e n n o t t o h a v e y o u to c o m e b a c k to s w e a r it a g a i n ? 19 A 20 339 Q 21 A 22 34 0 Q 23 Fine, okay. Do you u n d e r s t a n d ? Certainly. I t h i n k that m a y w i l l be in e v e r y o n e ' s interest to do that? 24 A 25 34 1 Q Certainly, okay . I w o n d e r c o u l d y o u do t h a t r e a s o n a b l y q u i c k l y 26 b e c a u s e we are g e t t i n g to the e n d of this p h a s e 27 of o u r i n q u i r i e s ? 28 A 29 342 Q Yes . A n d w e a r e o b v i o u s l y a n x i o u s to t i d y it u p f a i r l y 44 1 Yes, 2 3 34 3 Q yes. I t h i n k t h e r e is o n l y o n e o t h e r t h i n g t h a t I h a v e 4 t o s a y to y o u a n d it is th i s : 5 a t e l e p h o n e call w i t h you on the 27th F e b r u a r y and 6 t h a t is g r a n d ? 7 A 8 344 Q 9 A 10 34 5 Q 11 A 12 346 Q T h a t Ms. Cummins had Yes . It w a s o n l y a h o u s e k e e p i n g t e l e p h o n e c a l l ? Yes . T h e r e is no d i f f i c u l t y a b o u t it? Right. However, t h e l a s t s e n t e n c e is: 13 14 "He a l s o t o l d m e t h a t L i a m M c G o n a g l e h a d a r r a n g e d t h r o u g h D e s T r a y n o r fo r a job to be d o n e for the p a r t n e r s an d t h e y w e r e u n a w a r e of t h e e x t e n t of it until relatively recently." 15 16 17 18 19 W h a t w e r e y o u r e f e r r i n g t o in t h a t ? A I p r e s u m e w e a r e r e f e r r i n g to t h e p a y m e n t i n 1 9 9 3 of t h e fee. 20 21 347 Q 22 A 23 348 Q 24 A 25 Yes? I p r e s u m e t h a t w a s it. Yes. C o u l d it h a v e b e e n a n y t h i n g e l s e ? I can't t h i n k of anything. h a v e b e e n a n y t h i n g else. 26 349 Q 27 A 28 35 0 Q 29 A All right? No. T h a t is g r a n d ? No, it w o u l d n ' t 1 35 1 Q. 2 A. 3 352 Q. 4 A. 5 35 3 Q. 6 A. 7 354 Q. 9 A. 10 35 5 Q. 11 A. t h a t is m y . . . ( I N T E R J E C T I O N ) . That that was in fact the s i t u a t i o n ? Yes, t h a t is m y r e c o l l e c t i o n o f it. T h a t is y o u r r e c o l l e c t i o n ? But I mean you surprised me about that other payment W e l l ... ( I N T E R J E C T I O N ) ? No, I have.. . (INTERJECTION). I n 19 84 or 1 9 9 2 ? 13 3 5 6 Q. 14 A. 15 357 Q. 16 A. 17 358 Q. 18 A. 19 W h i c h is m o r e s u r p r i s i n g to y o u ? N o t h e -- n o t t h a t o n e o n e i n 1984 12 (indicating). The other I think. 1984? I s n ' t it t h e m e m o ? Yes, I see? O n t h e 5 t h S e p t e m b e r 1984, E x h i b i t 7. Yes? I a m s u r p r i s e d at t h at. I have no r e c o l l e c t i o n of t h at . 3 5 9 Q. Y o u h a v e no r e c o l l e c t i o n o f t h a t at all. I do under s t a n d how these things can happen? 21 22 A. 23 36 0 Q. 24 A. 25 36 1 Q. 26 Yes. W i t h o u t y o u h a v i n g a r e c o l l e c t i o n of t h e m ? Yes. However, I wonder whatever about the 19 84 o n e w h i c h is m i l d l y s u s p i c i o u s ? 27 A. 28 362 Q. 29 Yes, i n 1984. 8 20 I just w a n t e d to check? Yes. T h e 1 9 9 2 o n e is a p o s i t i v e c o n n e c t i o n ? 1 36 3 Q 2 A 3 364 Q 4 A 5 36 5 Q 6 A 7 8 Sure . I m e a n t h a t is t h e p o s i t i o n ? Yes, okay. All right? Well, we can h o p e f u l l y get that e x p l a n a t i o n from you. 3 66 Q 9 Ms . M a c k e y ? MS. MACKEY: JUDGE O'LEARY: 10 No, no questions. Mr. O'Shea, thank you ve r y m u c h indeed. 11 12 A 13 367 Q T h a n k you. T h a t is a c t u a l l y e v e r y t h i n g w e h a v e t o s a y to y o u 14 and t h a n k you v e r y m u c h for all your c o o p e r a t i o n 15 a n d w e a p p r e c i a t e it g r e a t l y . 16 early replies. 17 y o u c o u l d do t h a t ? 18 A 19 368 Q Yes, We w o u l d appr e c i a t e It w o u l d f a c i l i t a t e us g r e a t l y if yes. O b v i o u s l y p a r t of the p r o c e s s is t h e s i g n i n g o f the transcript? 20 21 A 22 369 Q 23 A 24 37 0 Q Yes . B e c a u s e it is i n c l u d e d in t h e L e g i s l a t i o n ? Yes, So, yes. I mean obviously.. . (INTERJECTION). i n d u e c o u r s e Ms. C u m m i n s w i l l be in 25 touch wit h your firm and you can m ake the 26 necessary arrangements? 27 A 28 29 So, I m e a n I c a n c o m e i n to s i g n it w h e n e v e r it is r e a d y . 37 1 Q 1 2 A n d c o p i e s of t h e t r a n s c r i p t c a n b e g o t f o r a 3 p a y m e n t of? 4 MS. 5 JUDGE O'LEARY: CUMMINS: 6 A 7 37 3 Q All right? 8 A T h a n k you. 9 374 Q 10 A £60. O f £60. Yes . T h a n k you v e r y m u c h indeed. T h a n k you. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE E X A MINATION WAS THEN CONCLUDED \i?p .223, . (67. m. I. 2f.er a 4 an Offuu a. .V: VI 745.; - Pix. MICHAEL O’SHEA I understand that I have been called to give evidence pursuant to the Inspectors’ pow ers set forth, inter alia, in Section 10(2) o f the Companies Act, 1990. I am here today because o f the exercise o f the Inspectors’ right to com pel my attendance. I am not here voluntarily. I am not prepared to answer questions voluntarily. I understand the Inspectors have pow er to force me answer their questions, provided always the questions are within the scope o f their investigation. A ll answers I give today are given as a result o f the exercise o f the Inspectors o f their powers under Section 10 and/or such other statutory powers as they have to com pel answers and not otherwise. I have asked the Inspectors not to exercise their power to compel m y testim ony. They have insisted I answer all questions under com pulsion o f law. K ennedy M cG onagle B allagh Incorporating Bell Branigan O’Donnell & O’Brien s o l i c i t o r s 20 NORTHUMBERLAND ROAD DUBLIN 4 TEL 660 9799 FAX 660 9434 EMAIL: info@kmb.ie www.kmb.ic The Office o f the Inspectors appointed High Court to Ansbacher (Cayman) Ltd. 3rdFloor Trident House Blackrock Co Dublin Our ref: MO’S/DF 5 ' , ^ _v. . ■**' 16 March 2001 Re: Ansbacher (Cavman) l imited (“the Compand) Dear Inspectors, I have had no dealings personally with the Company. However I believe the Firm o f Kennedy McGonagle Ballagh in which I ain a partner have had the following dealings. ' " 1. In November 1993 the firm was instructed by Cayman International Bank and Trust Company T.imiteri to pursue a guarantor on foot o f a guarantee given to Guinness & Mahon Cayman Trust Limited on behalf o f a Cayman registered company called Coral Reef Securities Limited. Proceedings were instituted against the guarantor and were ultimately settled. Our fee of £3,210 and outlay was discharged by the Company. The Solicitor who handled this matter for the Company was Kevin Barry. 2. Also in 1993 a fee paid by a U.K. client o f the Firm was lodged by the partner who acted for this client with the late J.D. Traynor and this fee was subsequently paid to the partners including me through Kentford Securities Limited. The partner who handled this matter was the late Liam D. McGonagle who was a personal friend o f the late J.D. Traynor. The U.K. client was not a client of the Company and did not avail o f any o f the services provided by the Company. I believe Mr. Traynor merely facilitated my late partner, Liam D. McGonagle and neither he nor the Company nor Kentford Securities were paid a fee for this service. —' 3. In 1995 the Firm advised the Company in connection with a loan granted to Columbia Investments (an unlimited Irish registered company) and also in respect o f a guarantee and pledge agreement by Columbia Investments Limited to the Company in respect o f loans made by the Company to two Cayman Island registered companies. The Company discharged our fee of £6,750 and outlay for this work which was handled by Olivia McCann, a former assistant in the Finn. M Il'ilA U . J. 0'M i:.-\ RtXlliR I*. IW I.I.AOII I'CKIINCi: li. DIXON KCVIN C. I1ARUV GOKt* >\ Jl U .t a s s i s t a n t : i u .im a i i i :\ r \ , u ;a i m a r». i a v i .o r C O N S n .TA N TS : U l.'K I-N C T. I'. HRANKiAV M A M IN A I - O 'fiO K M A N 4. Also in 1995 the firm was instructed in relation to an application by the Company to the High Court for leave to extend the time for filing Form 47 with the Companies Office in respect o f the security referred to at 3 above. The Company discharged our fee o f £400 plus outlay for this work which was again handled by Olivia McCann. 5. I have personally been involved in advising a number o f clients who have had or have a relationship with the Company and this advice has been given in the context o f McCracken and Moriarty Tribunals and statements and attendances before you. The Company has provided no service to me personally and I have not established any trust managed by the Company nor to my knowledge am I the beneficiary o f any trust managed by the Company. 1 have not deposited any money with the Company or with Guinness & Mahon (Ireland) Limited however Kennedy McGonagle Ballagh has from time to time used the services o f Guinness & Mahon (Ireland) Limited. It has deposited the Firm’s money and clients’ money with that Bank from time to time and during one or both of the Bank strikes it used banking facilities provided by that Bank. Guinness & Mahon has provided a normal commercial loan to the partners in the firm including me to fond the purchase o f No. 18 Northumberland Road. This loan was secured against the property purchased and our personal guarantees. It was not secured on any funds held by the Company. Apart from the service mentioned at 2 above, provided by Kentford Securities Limited, no service has been provided to me by any o f the other companies listed in your letter namely, Amiens Securities Limited, Amiens Investments Limited, and Irish Intercontinental Bank Limited. The only services provided by Guinness & Mahon (Ireland) Limited were those mentioned above in the preceding two paragraphs. No service has been provided to me by any o f the companies mentioned in your letter and established in the Channel Islands. Yours faithfully, / • l{/ ' ’ / s- - '"H / (.■ / ' *>> I ......... - ..... 5th September, 1984 Could 7 0 a please lodge the attached cheque for £8,250 Sterling to Sundry Persons and give me Sterling drafts aa follows 0 h *• . **\ lUcbael O'Shea T. Dixon £1,650 £1,650 Redshank Investments £3,135 £8,250 I • -%r e*UV\!e %. C o lle g e T r u ste e s U m ife d DKA/ 2nd May, 1 9 8 5 H. M. G r e f f l e r , R o y a l C o u rt H ou se, S t . P e te r P o r t, . G u ern sey. - ' . ‘ ' D ear S i r , ""7S'C cQ ,^ JS • ' . u . RBTMHANK INVESTMENTS LIMITED The r e g i s t e r e d o f f i c e an d t h e p o s t o f f i c e b o x 'n u m b er o f t h e a b o v e c o m p a n ie s w as c h a n g e d on 1 5 t h A p r i l , 1 9 8 5 . The r e g i s ­ t e r e d o f f i c e I s now s i t u a t e d a t t - . P l a t e a u M ig n o t, Rue d e s C o r n e t s , S t . P e te r P o r t, G u e r n se y . ' . C o r r e s p o n d e n c e s h o u ld now b e a d d r e s s e d t o P .O . S o x 2 2 3 . Y ou rs f a i t h f u l l y , . .. f o r COLLEGE TRUSTEES LIMITED. ' P.O. tt«K 122. Si. lu lto n l O m ri. Si. Julian* Arennc. St. P a »r Pon. Ouenuey, Channel Manila. Tuicphime; Cucrnwr 2IHWI T .-ln : 4 I « I » : l»<«lnnid«Hit C u « f # « y « 7 P ^ e*viu v= . Pleaae reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 R ue 612035 % Ansbacher Limited P.O. Box Itl,Qnnd G y a ia , Cayman hhrah. Bririih Wait India Telephone:(IQ9)94M633 TetacCP43C3 Facsimile (909)949-7946 (809) 949-5M7 1 8 th M ay , 1 9 9 2 . R onan H e d a o n d , E s q . , C o r p o r a te S a r v ic a s , I r i s h I n t e r c o n t i n e n t a l Bank L i a i t e d , 91 M e r r io n S q u a r e , PDBLIW 2 . . 0 fi C D ea r R o n a n , .' ' . 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W ow n I Normo • CeollrmaitonCal N tOm^u* / OHM m m y DEPOSIT D€AUNQ TICKET ^ C < « ^ 3 H in D nxgo I /^ w bw ThwwwyCopy CuMamar H cd 'v u J £ £ © v ~ ContractNo. 134839 o a o t AUTHORISATION ISRgQUWgQt NOSTRO IN-DfPOSIT Wt borrow- «w a m * on Oapoift Curr x7 J& E E . *mn fe,7r» « Wt dab* your A/C "‘ ■■^NOSTROOUT— I - Waptaca-watafyf-wanpay L Wtcradt yourA/c J R & = > !l MaurtfrPli MSflMt RlH SPECIAL INSTRUCTIONS inter**Amount 1W«x PHH6pB>W» A! Maturity OUT TO ClanT* Maturitytoatrudtoni OUT TO - Ctont* Inctiuetiona (Eraqulratlantfnot k Know n w n/ II r O & c L a lv O L j\J C 4*U *2fc"i lW f* f NOSTRO /■ .ConlhmMen Call .... .. X. PwChaqua --------------------------- r * - ------- --- - ...’ ■ 11,11,1 1 MASON HAYES & CURRAN S O L I C I T O R S Office of the Inspectors appointed by the High Court to Ansbacher (Cayman) Limited, 3rd Floor, Trident House, Blackrock, Co. Dublin. 14 December 2001 M atter : Y o u r Re f : *j '* £ O u r R e f : D M /P C Ansbacher Dear Sirs, W e act for M r. Michael O ’Shea, a partner in Kennedy McGonagle Ballagh, Solicitors, 20 Northumberland Road, Dublin 4 who has requested us to write to you in response to your letter to him dated 23 November 2001. Having considered the “Inspectors Preliminary Conclusions” we are at a loss as to how the information (such as it is) or the reasoning (or lack of it) justifies the “Preliminary Conclusions” reached. /** ' What is clear is that Kennedy McGonagle Ballagh was due a fee and it was paid. The partner to whom it was paid gave M r. Desmond Traynor the money and in due course caused it to be returned to the partner in a manner that divided it between himself and other partners. It is said the monies, part of which were received by M r. O ’Shea, came from Hamilton Ross or an entity unknown to our client (a matter you assert but do not sustain by any evidence disclosed). This does not prove your conclusions even if true (a matter not conceded or accepted). In short your “Preliminary Conclusions” that M r. O ’Shea was a client of Ansbacher are ill founded. No proof whatsoever has been produced to show that M r. O ’Shea was a client of Ansbacher. He is not, and never was, a client of Ansbacher. Even allowing for your apparent broad interpretation of “client”, this word quite clearly has a specific meaning as defined in all the standard dictionaries and under none of these definitions can M r. O ’Shea be held to be a “client”. 6 Fitzw illia m S q u are, D u b l i n 2, Ireland , D X I I D u b l i n , Tel + 3 5 3 1 6 1 4 5 0 0 0 , F a x + 3 5 3 1 6 1 4 5 0 0 1 , w w w .m h c . i e , E-m ail m ail@ m hc.i e Maurice R. Curran, Maeve Hayes, Anthony Burke, Declan Moylan, Iorcan Buckley, Finer Ciilvarry, Paul J. G. F.gan, Colman P. Curran, Nora Larkin, Declan Curran, Richard A. Woulfe, Kevin Hoy, Deelan Black, l.iam Brazil, Ailbhe Gilvarry, John Kettle, David O'Donnell, Niall Michel, John Kehoe, Peter Mclnnes Senior Associates Niamh Clarke, Matthew Wales, Majella Dolan, Gillian McNamara, Shane MacSwcency, Susan Ryan ConsuUiUits A. Dermor Mason, Clonal J. Clancy, Rory L. Egan i-ia w in Belfast Therefore we require your confirmation by return that no such conclusion will appear in your Report. Yours faithfully, MASON HAYES & CURRAN MASON HAYES & CURRAN S O L I C I T O R S Office of the Inspectors appointed by the High Court to Ansbacher (Cayman) Limited. -2rd 3 rri Floor, Trident House, Blackrock, Co. Dublin. — - 15 January 2002 M atter : YOUR R ef O ur R e f : DM/PC Ansbacher Dear Sirs, We write on behalf of Mr. Michael O’Shea. Thank you for your letter of 21 December 2001 in response to ours of 14 December 2001. Unfortunately, your refusal to amend any part of your preliminary conclusion is not acceptable to our client who is outraged by it. Our client understands the pressures upon you to produce a final report. However we must, with respect, suggest that the treatment afforded our client is grossly unfair and does not vindicate his rights in any respect. Our client communicated with you by letter of 16 March 2001 written in response to a request by you. The relevant portion of that letter is to be seen in paragraph number 2 in which the following is said:“ Also in 1993 a fee paid by a U.K. client of the F i r m w a s lodged by the partner w h o acted for this client with the late J.D. Traynor a n d this fee w a s subsequently paid to the partners including m e through Kentford Securities Limited. The partner w h o handled this matter w a s the late L i a m D. M c G o n a g l e w h o w a s a personal friend of the late J.D. Traynor. The U.K. client w a s not a client of the C o m p a n y a n d did not avail of any of the services provided by the Company. I believe Mr. Traynor merely facilitated m y late partner L i a m D. M c G o n a g l e a n d neither he nor the C o m p a n y nor Kentford Securities Limited were paid a fee for this service". Your preliminary conclusion is premised upon a narrative that states as follows:- illiam S q u are, D u b lin 2, Ireland , D X I I D u b l i n , Tel + 3 53 1 6 1 4 5 0 0 0 , F ax + 3 5 3 1 6 1 4 5 0 0 1 , w w w .m h c . i e , E-m ail m ail@ m h c.ie an alliance with CarsonMcDowell m “ Mr. Michael O ’ Shea, Mr. Roger P. Ballagh a n d Mr. Terence D. E. Dixon are Solicitors in the firm of Kennedy M c G o n a g l e Ballagh, 2 0 Northumberland Road, Dublin 4. Their involvement in Ansbacher arose out of their late partner’ s (Mr. L i a m M c G o n a g l e ) long-term involvement in offshore banking. During 1992, fees earned by the firm were deposited, at the suggestion of Mr. McGonagle, with Mr. D e s m o n d Traynor a n d ended up in an Ansbacher account. The s u m involved w a s £40,000 approximately. The m o n e y was left on deposit offshore for s o m e time a n d then shared out a m o n g the partners. The payments were m a d e f r o m a Hamilton Ross account in Ansbacher. The IIB dealing tickets s h o w that Mr. Ballagh received over I R £ 1 1,530.00, Mr. O ’ Shea a n d Mr. Dixon received IR£6,243.00 each a n d the firm received IR£4,877.00 a n d a c o m p a n y controlled by the late Mr. L i a m M c G o n a g l e stg£6,701.00. ^ All the partners w h o shared in that f und were thus clients of Ansbacher. The Inspectors’ formal decision on the late Mr. M c G o n a g l e is to be found elsewhere in the report". It is said that the preliminary conclusion, which you stand by, is: “ Mr. Michael J. O ’ Shea, Mr. Roger Ballagh a n d Mr. Terence Dixon were clients of Ansbacher". The evidence supporting your conclusions is said to be a statement by M r. Michael O ’Shea, evidence given by Michael O ’Shea, the exhibits produced at that hearing (by you) and the seven further exhibits set out. Your “ Preliminary Conclusions" On page 10 of the transcript we find that Inspector O ’Leary stated: “W e must identify the client of the c o m p a n y w e are investigating... Ansba c h e r ”. W e note in the “ foreign exchange dealing ticket (document 5)” appended to your preliminary conclusion, it is expressly stated that the customer is “ Hamilton R o s s ”. What M r. O ’Shea has said, which is uncontradicted, is that the fee paid in 1993, by a client of Kennedy McGonagle Ballagh, was subsequently divided among the partners including M r. O ’Shea. M r. McGonagle was the person who organised all this. He was the only person who knew what he did to recover payment and effect a division. In the circumstances, might we respectfully suggest that a fair analysis of this transaction, if the transaction has any part to play in your report (which we cannot accept) would be as follows: “In 1993 Mr. Michael O ’ Shea, in his capacity as a partner in his Solicitors' practice, received part of a fee earned by one of his fellow partners Mr. L i a m McGonagle. Mr. M c G o n a g l e took responsibility for recovering the fee f r o m the partnership’ s client a n d making the arrangements for its distribution a m o n g his fellow partners. It n o w transpires that the payment to Mr. O ’ Shea w a s effected through a c o m p a n y called Kentford Securities Limited. It n o w appears that the payment in question w a s effected by Hamilton Ross drawing on an account maintained with another bank (possibly Ansbacher (C a y m a n ) Limited). Mr. O ’ Shea w a s not party to the arrangements that Mr. M c G o n a g l e put in place. Whilst it is clear that Mr. O ’ Shea received a p ayment through Kentford Securities Limited w e have not been able to establish whether he w a s a client of Ansba c h e r ”. We do not believe that there can be any objection to presenting your conclusion in that manner. We are of the opinion that the current draft goes well beyond the evidence you refer to reasonably sustains. We say this, subject always to your cogent explanation of the matters we refer to above. We have to say that we are gravely concerned by your refusal to engage in any meaningful dialogue in relation to your preliminary conclusions. As a matter of common sense, your approach is not fair. We have not seen the context in which the part of your report will be read and as we detail, the factual narrative is unsound and the conclusion unwarranted and as a matter of law, it is also a denial of our client’s right to fair procedures. The fact that you have written to our client clearly establishes that:(a) You are of the view that your conclusion constitutes “a finding or inference adverse to Mr. O ’ Shea’ s interests, g o o d n a m e and/or reputation ^ (b) That Mr.O’Shea has the right to be: (i) (ii) (iii) (iv) (v) informed in writing of the proposed finding or inference informed of the evidence which is thought to justify the proposed finding or inference afforded the opportunity to prepare a written reply to the proposed finding or inference afforded, by way of further examination on oath, an opportunity to introduce rebutting evidence and/or to address the Inspectors afforded an opportunity to cross-examine the relevant witnesses. In circumstances where you have simply failed to engage on the case made by Mr. O’Shea in response to the suggestion he should be described as a “client of A n s b a c h e r ”it is incumbent on us, for the purposes of protecting his interest, good name and reputation, to take this matter further. Please note that we require the following:- ^ 1. The opportunity of producing evidence that in relation to the distribution of the fee, M r. O ’Shea had no knowledge of the arrangements being put in place by Mr. McGonagle and absolutely no knowledge that the monies that he received had, at any time (if that be the case, a matter we do not accept that you have evidence of) been retained in an Ansbacher account. 2. We also require that we be entitled to address you. Clearly, the procedures you yourself have adopted provide for the right to have an interplay of views between yourselves and persons such as M r. O ’Shea for the purposes of permitting him to appropriately vindicate his interest, good name and reputation. In the event that we cannot make some headway in dealing with your preliminary conclusion, either by following our procedural rights as identified above, or through some other means, our client wishes the opportunity to cross-examine such witnesses as you have who can give relevant evidence that the monies in question were ever in an Ansbacher account. Perhaps you could identify these witnesses and indicate when they w ill be made available for cross­ examination and deliver a transcript of the evidence they have given. W e note in your procedures that where issues arise between any person and your good selves, a procedure of seeking directions from the High Court to resolve issues is referred to. Should we fail to reach an accommodation in relation to the provisions of your report to which we refer, we reserve our right to be the subject matter of such application. You w ill appreciate the impossible position M r. O ’Shea finds himself in. He is a solicitor and an Officer of the High Court. He has received a share in a fee due to a legal practice of which he was a partner. It is said, from circumstances of which he knows nothing, that part of this money may have been held in an account operated by Ansbacher. W e have to say, with the greatest respect, that to see him designated as “a client of A n s b a c h e r ”with the damage to his interests, good name and reputation that such a designation w ill bring, is unfair, unjustified, unnecessary and irrational. In relation to the monies paid to M r. O ’Shea, he objects to being dealt with in a section of your report that also deals with other persons, unless you can explain why this should be the manner of presentation. Further, the proposed draft of your report contains detail quite irrelevant to your account and the conclusion you threaten to draw. Finally, it seems to us a brief meeting between the representatives of yourselves (or better still yourselves) and this office could go a very long way to defusing what on the face of it, appears to be a confrontation that is entirely unnecessary. M r. O ’Shea has no problem accepting that he received the payment in question. His objection is to being called a client of Ansbacher, an institution the services of which he never knowingly utilised or wished to utilise either personally or for any client We assume that pending your response to this letter, no report will be published containing the sections concerning Mr. O’Shea. If this is not to be the case, please tell us and we will take the necessary action elsewhere. Yours faithfully, MASON HAYES & CURRAN Appendix XV (104) Mr John Oppermann & Mrs Eileen Oppermann 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John Oppermann & Mrs Eileen Oppermann. a) Transcript of evidence of Mr. John Oppermann & Mrs Eileen Oppermann dated 10 March 2000. b) Internal Guinness and Mahon memo of 15 August 1983 - JD Traynor to Foreign Exchange. c) Internal Guinness and Mahon memo of 18 August 1981 - JD Traynor to Foreign Exchange. Correspondence received from or on behalf o f Mr John Oppermann & Mrs Eileen Oppermann. a) Letter of 26 November 2001 from Rochford & Co Solicitors to Inspectors. & M RS. EILEEN OPPERMANN UNDER OATH ON FRIDAY, 10TH M A R C H 2000 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer MR. JUSTICE COSTELLO MS. M A C K E Y B.L. S O L I C I T O R TO THE INSPECTORS: MS. M. C U M M I N S INTERVIEWEE: MR. JOHN OPPERMANN THE INSPECTORS: MR S. I N S T R U C T E D BY: MR. EILEEN OPPERMANN JOHN ROCHFORD SOLICITOR EQUITY HOUSE 16/17 U P P E R ORM O N D QUAY D U B L I N 7. 1 2 3 4 MR. JUSTICE COSTELLO: 5 We will start our i n t e r v i e w t h e n Mr. Oppermann. & 6 M rs . I am D e c l a n C o s t e l l o a nd on m y 7 r i g h t is Ms. M a c k e y a n d w e a r e t w o of t h e i n s p e c t o r s 8 w hich have be e n ap p o i n t e d by the High Court. 9 s h o u l d e x p l a i n t o y o u t h a t t h i s is n o t a C o u r t , is n o t a T r i b u n a l , 11 p r o p o s e t o do w o u l d b e t o a s k Ms. 12 a s k y o u s o m e q u e s t i o n s a n d w e w i l l t a k e it in 13 w h i c h e v e r o r d e r y o u li ke. 14 M rs . 15 that you m i g h t want to answer, 16 s h o u l d e x p l a i n t o y o u t h a t i f t h e r e is a n y p r o b l e m 17 a b o u t a n y q u e s t i o n t h a t w e a s k a n d t h a t y o u w a n t to 18 g e t t h e a d v i c e f r o m y o u r s o l i c i t o r a b o u t it, 19 so a n d I w i l l 20 advice. 21 a d v i s e y o u on a q u e s t i o n , 22 solicitor can then advise you accordingly. 23 i n t e r v i e w t h a t w e a r e g o i n g to h a v e is u n d e r o a t h 24 a n d I w i l l a s k n o w o u r s o l i c i t o r Ms. 25 a d m i n i s t e r t h e o a t h f i r s t to y o u Mr s. 27 28 29 What it 10 26 it is a n i n t e r v i e w . I I would M a c k e y f i r s t to Will we ask Op p e r m a n n first and then ask you some questions Mr. Oppermann. I tell me stop questioning you and you can ask S i m i l a r l y if y o u r s o l i c i t o r w i s h e s to I will stop and your The C u m m i n s to Oppermann. 1 2 3 4 5 MR. JUSTICE COSTELLO: 1 Q. MS. MACKEY: Mrs. Oppermann, you r e c e i v e d o u r l e t t e r of 8 9 20th January? 10 A. 11 2 Q. MR S. OPPERMANN: Yes. I n t h a t l e t t e r w e a s k e d y o u to p r o v i d e us w i t h a statement and some documents? 12 13 A. 14 3 Q. 15 Yes. W e d i d n o t r e c e i v e a n y f r o m you. D i d y o u i n t e n d to g i v e us s o m e ? 16 A. 17 4 Q. 18 A. Yes, so rry , J o h n . .. D o y o u w a n t to s p e a k to y o u r s o l i c i t o r f o r a m o m e n t ? Yes, m a y I s p e a k to m y s o l i c i t o r ? 19 MR. JUSTICE COSTELLO: Certainly, 20 MS. MACKEY: Yes. 21 M a c k e y to ask you some questions. 6 7 I w i l l a s k Ms. A. I a m so rry , yes. that was a m i s u n d e r s t a n d i n g because I 22 t h o u g h t w h e n w e g a v e it to o u r s o l i c i t o r t h a t h e w a s 23 going to an s w e r the questions. 24 5 Q. 25 A. 26 6 Q. 27 Do yo u h a v e d o c u m e n t s ? W e h a v e n o d o c u m e n t s at all. Do y o u h a v e a n y in y o u r p o s s e s s i o n at h o m e in r e l a t i o n to t h e q u e s t i o n s t h a t we a s k e d ? 28 A. 29 7 Q. No. Then what I p r o p o s e to d o is j u s t a s k y o u n o w t h e 1 q u e s t i o n s w e a s k e d in t h e l e t t e r a n d p e r h a p s y o u c a n 2 tell me i n s t e a d of giving me a w r i t t e n statement. 3 F i r s t of all, 4 w h e t h e r you ever e x e c u t e d or c a u s e d to be e x e c u t e d a 5 D e e d of T r u s t in t h e C a y m a n I s l a n d s ? 6 words, 7 Islands? 8 Never. 9 8 Q 10 A 11 9 Q the first t h i ng we a s k e d you was In o t h e r h a v e y o u e v e r set u p a t r u s t i n t h e C a y m a n You never did? No. A s y o u k n o w w e a r e i n v e s t i g a t i n g t h e a f f a i r s of 12 A n s b a c h e r Cayman which p r e v i o u s l y was 13 Guinness M a h o n Cayman Trust. 14 we a s k e d yo u in ou r l e t t e r was w h e t h e r yo u ever 15 a v a i l e d of a se r v i c e that A n s b a c h e r C a y m a n m ade 16 a v a i l a b l e to it s c l i e n t s , 17 use deposits 18 w i t h d r a w m o n e y here in Ireland, 19 of t h a t f a c i l i t y ? 20 A 21 10 Q A A n o t h e r question that namely, t h e p o s s i b i l i t y to i n A n s b a c h e r C a y m a n t o l o d g e or did you ever avail we l o d g e d money. Y o u did. P e r h a p s you can tell me a bout that. you actually have a deposit 22 23 Yes, k n o w n as Did in A n s b a c h e r C a y m a n ? I n e v e r k n e w it w a s A n s b a c h e r C a y m a n u n t i l now, but 24 w e g a v e De s m o n e y a n d as f a r as I k n e w he w a s t a k i n g 25 c a r e of it a n d t h a t w a s it. 26 11 Q M a y b e w e c a n s t a r t at t h e b e g i n n i n g a n d m a y b e y o u 27 c o u l d t e l l m e h o w d i d y o u f i r s t m e e t Mr. 28 I c a n ' t r e m e m b e r h o w I a c t u a l l y m e t him. 29 m u s t h a v e b e e n t h r o u g h J o h n n y b e c a u s e w h e n he c a m e Traynor? I t h i n k it 1 out to the r e s t a u r a n t we b e c a m e v e r y close friends 2 with himself and his 3 there. 4 12 Q. 5 A. 6 13 Q. Mr. Yes, f a m i l y a n d it s t a r t e d f r o m T r a y n o r came to y o u r r e s t a u r a n t ? with his family. P e r h a p s to fill in the b a c k g r o u n d h e r e I s h o u l d get 7 a b r i e f r e s u m e of y o u r ow n career. 8 restaurant 9 A. 10 14 Q. 11 A. 12 15 Q. 13 A. 14 16 Q. 15 A. 16 17 Q. 17 A. 18 18 Q. 19 A. 21 19 Q. 22 A. 23 20 Q. 24 28 29 In Mala h i d e , yes. That r e s t a u r a n t was k nown as? Johnny's Restaurant. Do yo u still ru n this r e s t a u r a n t ? No, we are retired. W h e n di d you retire and close the restau r a n t ? A r o u n d about 1989. You were running that restaurant R o u g h l y late 1973 up until from what date? 1989. D u r i n g t h a t p e r i o d y o u s a y Mr. T r a y n o r c a m e to t h e Yes, b u t w a s a f r i e n d as w e l l . He w a s a l r e a d y a f r i e n d ? N o t b e f o r e he c a m e to t h e r e s t a u r a n t , no. T e l l m e h o w y o u f i r s t c a m e in t o c o n t a c t w i t h h i m in a b u s i n e s s r e l a t i o n s h i p in r e l a t i o n to t h is? A. 26 27 in M a l a h i d e ? r e s t a u r a n t as a c u s t o m e r ? 20 25 You owned a I think the business relationship started with my husband and then I followed accordingly. 21 Q. C a n y o u t e l l m e at t h e p o i n t w h e r e y o u c a m e i n t o it how that arose? 1 b e e n s o m e t i m e m a y b e in t h e e a r l y 1 9 8 0 's I w o u l d 2 say. 3 22 Q 4 A W h a t h a p p e n e d at t h a t t i m e ? I w o u l d c a s h s o m e of J o h n n y ' s salaries and I would 5 k e e p t h e m a n d w h e n Des w o u l d c o m e out, 6 him the money. 7 23 Q 9 A t t h a t t i m e an a c c o u n t h a d b e e n o p e n e d w i t h Mr. 8 A I would give Traynor, is t h a t w h a t h a p p e n e d ? T here was n e v e r any doc um e n t signed. Des w o u l d just 10 t a k e t h e m o n e y a n d t h a t w a s t h e l a s t I w o u l d h e a r of 11 it. 12 r e q u e s t e d it. 13 24 Q 14 15 A 16 17 I w o u l d n e v e r get a r e c e i p t o n l y w h e n I Do y o u k n o w h o w t h i s s t a r t e d a n d is t h a t s o m e t h i n g Mr. Oppermann can tell me? No, Mr. O p p e r m a n n m i g h t b e a b l e t o t e l l you, I c o u l d n ' t t e l l you. 25 Q P e r h a p s it m i g h t b e o p p o r t u n e to a c t u a l l y a s k 18 Mr. 19 b e g i n n i n g o f it. 20 t h e s t a r t o f it t h a n y o u do a n d w e c a n c o m e b a c k to 21 you, 22 m i g h t b e a m o r e u s e f u l w a y o f d o i n g it. 23 Mr. 24 l i t t l e b i t a b o u t y o u r b a c k g r o u n d as w e l l b e f o r e we 25 begin, 26 business? 27 A MR. O p p e r m a n n at t h i s s t a g e to t e l l us a b o u t t h e Mrs. I t h i n k m a y b e he k n o w s m o r e a b o u t Oppermann, if n e c e s s a r y . I t hink that O p p e r m a n n if I c a n t u r n to y o u a n d j u s t to g e t a you and your wife were partners OPPERMANN: 28 The r e s ta u r a n t was 29 A p p r o x i m a t e l y 1973, T h a t ' s right, in this yes. set u p in 1 9 7 3 as y o u r w i f e s a y s ? yes. 1 27 Q 2 A 3 28 Q 4 A T h a t ' s right. H o w d i d y o u c o m e in c o n t a c t w i t h Mr. He u s e d to c o m e o u t w i t h h i s 5 restaurant. 6 opening the restaurant. 7 get to know a person, 8 c o m i n g in n o w an d again. 9 a good place Traynor? f a m i l y a n d d i n e in the P r e v i o u s l y I t h i n k I m e t h i m p r i o r to L i k e e v e r y t h i n g else, p a r t i c u l a r l y a p e r s o n t h a t is I a s k e d h i m once where was for i n v e s t m e n t a n d the a n s w e r I got 10 was ; 11 w i l l i n v e s t it f o r y o u . " 12 O ver the years we gave h i m money. 13 small amounts, 14 m o r e t h a n £ 4 0 0 o r £50 0, 15 wh e n I had some bonds w hich were not d oing very 16 w el l , 17 29 Q 18 A you " if y o u h a v e a n y m o n e y , g i v e it t o m e a n d I T h a t is h o w it s t a r t e d . I wouldn't They were very s a y at a n y t i m e it w a s but we d id on one o c c a s io n I c a s h e d t h e m a l l in a n d g a v e t h e m t o him. Yes . W e n e v e r at a n y t i m e a s k e d h i m w h e r e t h e m o n e y was. 19 In fact, 20 m u c h w e h a d g i v e n him, 21 g e t f r o m h i m n o w a n d a g a i n a l i t t l e p i e c e of p a p e r 22 w i t h j u s t h o w m u c h we h a d i n v e s t e d w i t h h i m a n d w h a t 23 a m o u n t o f p r o f i t w e h a d m a d e o n it. 24 30 Q 25 26 I c a n t e l l y o u at t i m e s w e d i d n ' t it w a s so s m a l l . know how W e u s e d to C an you d e s c r i b e this p i e c e of p a p e r to me? H a d it the h e a d i n g of a bank? A 27 It w a s e x a c t l y l i k e w h a t y o u w o u l d g e t f r o m till, t h a t is it, 28 31 Q 29 A w i t h n o t h i n g o n it. No h e a d i n g of the bank? 1 32 Q 2 A 3 33 Q 4 A 5 34 Q 6 A 7 35 Q 8 A 9 No, a n d it w a s t y p e w r i t t e n . H a d it y o u r n a m e on it, No, Mr. Oppermann? nothing. H a d it a n y r e f e r e n c e n u m b e r ? Nothing. H o w d i d y o u k n o w it w a s y o u r s ? We didn't. L e t m e s a y t h i s t o you; w e h a d so m u c h c o n f i d e n c e in t h a t m a n t h a t w e n e v e r q u e r i e d at a n y time . 10 11 36 Q 12 A 13 37 Q 14 A W o u l d h e h a n d y o u t h i s o r p o s t it t o y o u ? He w o u l d h a n d it to us. W h e n h e c a m e to t h e r e s t a u r a n t ? Yes. H o w we first came to k n o w was 15 holidays 16 the Tribunal. 17 38 Q 18 A 19 39 Q 20 A I was a w a y on and when I came ba c k I had a letter from W h e n w a s thi s, Mr. Oppermann? It is a b o u t t w o y e a r s ago. T h i s is t h e M o r i a r t y T r i b u n a l ? Correct. At first I asked them why they needed me 21 because I knew nothing about the M o r i a r t y Tribunal, 22 so I w e n t to s e e t h e m w i t h m y s o l i c i t o r b e c a u s e t h e y 23 s a i d t o me, 24 b ring a legal man with y o u . ' 25 M a y b e if I c o u l d j u s t cu t y o u s h o r t a l i t t l e b i t 26 t h e r e a n d n o t t o c u t a c r o s s you, 27 you disco v e r e d where your m o n e y was? 28 No, 29 some co r r e s p o n d e n c e that 'I t h i n k it w o u l d b e i n y o u r f a v o u r to but that was how I o n l y d i s c o v e r e d a f t e r w a r d s w h e n t h e y s e n t us I d i s c o v e r e d t h a t it w a s in 1 2 41 Q. 3 A. 4 42 Q. 5 T h a t ' s right. C a n I a s k y o u w h e r e d i d y o u t h i n k it was, Mr. 6 A. 7 43 Q. Oppermann? I h a d n o i dea. L e t m e p u t it a n o t h e r w ay ; d i d y o u t h i n k it w a s in Ireland? 8 9 A n s b a c h e r Cayman. A. I am on o a t h a n d I w o u l d h a v e to t e l l yo u that 10 didn't 11 f r a n k l y it w a s h a r d e n o u g h t r y i n g t o r u n t h e 12 b u s i n e s s a n d I r e a l l y d i d n ' t think. 13 44 Q. I k n o w a n d it n e v e r b o t h e r e d m e b e c a u s e q u i t e You were telling me there about the m o n e y that you 14 w o u l d g i v e t o Mr. 15 one o c c a s i o n this was b o n d s that you h a d cashed. 16 A. 17 45 Q. 18 A. 20 46 Q. 21 A. 22 47 Q. 23 A. 24 48 Q. 25 A. 26 4 9 Q. 27 29 On the other occasions what m o n e y w o u l d you give S o m e of m y o w n s a l a r y . Your salary from? From the restaurant. In o t h e r words, you had a company, h a d you? Yes. That paid you a salary? Correct. Y o u r ow n p o s i t i o n in the c o m p a n y t h a t ra n the restaurant was? A. that on Correct. him? 19 28 T r a y n o r f r o m t i m e t o ti m e , I was ma n a g i n g director. 1 2 51 Q. W e h a v e to a s c e r t a i n f o r t h i s i n v e s t i g a t i o n t h e 3 n a t u r e of t h e m o n e y t h a t w a s i n v e s t e d i n A n s b a c h e r 4 a n d so on, 5 w a s d e c l a r e d to t a x ? 6 A. 7 52 Q. 8 A. 9 so I h a v e to a s k y o u w h e t h e r t h a t m o n e y It w a s t a x p a i d . It w a s t a x p a i d a l r e a d y ? Yes, b u t o n o c c a s i o n s h e h a d a d i n n e r p a r t y in t h e restaurant, w e w i l l say, 10 a n d h e w o u l d say, 11 a c c o u n t .' 12 53 Q. 13 A. 14 54 Q. 15 A. 16 55 Q. 'look, w h i c h was not v e r y o ften I w i l l l o d g e t h a t to y o u r The m o n e y for the d i nn e r p a rt y ? Correct. So Mr. T r a y n o r w o u l d do t h is? Correct. In o t h e r words, this w o u l d be m o n e y that t ax h a d not 17 b e e n p a i d o n a n d it w o u l d g o s t r a i g h t i n t o t h e 18 account? 19 A. 20 56 Q. Yes. W h e n you were lodging the money, y o u w o u l d g i v e D es T r a y n o r t h e c h e q u e or w h a t e v e r it w a s ? 21 22 A. 23 57 Q. 24 A. Yes. A f t e r t h a t y o u l e f t it to h i m ? I h a d n o i dea. T h e o n l y t i m e I k n e w t h a t it w a s in 25 the A n s b a c h e r was w h e n I got this l et t e r f rom the 26 M o r iarty Tribunal. 27 58 Q. 28 A. 29 59 Q. Yes, I understand. That was the first I knew. W h e n you got t hese little s t at e m e n t s f r o m t i m e to 1 2 3 60 Q. 4 A. 5 61 Q. 6 A. 7 62 Q. 8 A. 9 63 Q. A. It d i d s h o w y o u t h a t ? Yes. D i d y o u d e c l a r e t h a t i n t e r e s t to t h e R e v e n u e ? I d e c l a r e d n o t h i n g to t h e R e v e n u e . Y o u d e c l a r e d n o t h i n g to t h e R e v e n u e , 13 64 Q. 14 A. 15 65 Q. 16 A. 17 66 Q. 18 o n thi s, From did you? I t h i n k w e o n l y w i t h d r e w m o n e y t w i c e as f a r as I c a n Can you remember what those occasions were? W h e n w e w e n t on h o l i d a y s . To get t r a v e l l e r s cheques for example? Correct. H o w w o u l d y o u go a b o u t t h a t o r w h a t w o u l d y o u do if you wanted money? A. We just a s k e d h i m and t o l d h i m that we were g oing 20 a w a y and we w a n t e d some money. 21 o r e l s e w e w e n t a n d c o l l e c t e d it. 22 67 Q. 23 A. 24 68 Q. 25 A. 26 69 Q. 27 A. 28 70 Q. 29 ok a y . remember. 12 19 Yes. time to time you m ad e w i t h d r a w a l s 10 11 D i d it a l s o s h o w y o u i n t e r e s t t h a t h a d a c c u m u l a t e d ? He e i t h e r came out Y o u w o u l d g o w h e r e t o c o l l e c t it? Into Guinness Mahon. O r e l s e h e w o u l d b r i n g it o u t to y o u ? Correct. In w h a t f o r m w o u l d t h a t m o n e y b e g i v e n t o y o u ? C a sh. D i d y o u e v e r g o to Mr. T r a y n o r 's o f f i c e i n 1 2 71 Q. 3 A. 4 72 Q. 5 A. 6 73 Q. 7 To c o l l e c t c a s h ? Correct. This was a f t e r he h a d left Gu i n n e s s M ahon? Yes, naturally, yes. W h a t w o u l d h a p p e n w h e n y o u w o u l d go t h e r e ? w o u l d you see? 8 A. 9 74 Q. 10 A. 11 75 Q. 12 A. 13 76 Q. 14 A. 15 77 Q. 16 A. We w o u l d see himself. Y ou w o u l d see hi m s el f ? Yes. You never met anyone else there? Except his secretary. Joan Williams? Yes, Joan Williams. D i d y o u e v e r m e e t Mr. Padraig Collery? You asked me something now and I don't know whether 17 it w a s C o l l e r y -- w h e n h e d i e d we d i d n ' t 18 t h e m o n e y was. 19 78 Q. 20 A. 21 79 Q. know where I was g o i n g to come to that a ctually. W e w e r e t o l d to g o up t o n e a r C h r i s t c h u r c h . F i r s t o f all, can I ask you u p o n his d e a t h what did yo u do in o r d e r to find out w h e r e y o u r m o n e y was? 22 23 A. 24 80 Q. 25 A. 26 We h a d to call J o a n W i l l i a m s . You c o n t a c t e d Joan W i l l i a m s of your own v o l i t io n ? Yes, was 27 81 Q. 28 A. 29 Who s u r e w e d i d n ' t k n o w w h e r e t h e m o n e y w a s a n d it some mont h s afterwards Joan Williams, I think. what did she tell you? S h e t o l d us to g o to t h i s o f f i c e i n C h r i s t c h u r c h place. 1 82 Q 2 A Yes, W i n e t a v e r n Street. T h e p o i n t I a m g e t t i n g to 3 is I d o n ' t 4 w a s C o l l e r y o r s o m e o t h e r ma n. 5 83 Q 6 A 7 84 Q 8 A 9 85 Q k n o w w h e t h e r t h e m a n I m e t at t h a t t i m e But yo u me t s o m e b o d y in that o f f i c e ? I did, yes. W h a t d i d yo u sa y to t h e m or w h a t d i d t h e y tell you? I just went up a nd c o l l e c t e d a cheque. This was w h e n yo u a c t u a l l y w a n t e d to get m o n e y on 10 this occasion, 11 m o n e y was? 12 A 13 86 Q 14 A 15 87 Q No, I w a n t e d t h e m o n e y to r e i n v e s t it. Y o u w a n t e d to c l o s e the a c c o u n t ? That's correct. To j u s t g e t c l e a r w h a t y o u did, 16 Williams 17 account? 18 A 19 88 Q 20 A it w a s n o t to f i n d o u t w h e r e y o u r you contacted Joan and you tol d her you w a n t e d to close the W e a s k e d h e r f i r s t of a l l w h e r e t h e m o n e y w a s ? W h a t d i d she tell you? She said I will ar r an g e f o r y o u t o c o l l e c t it. I am 21 n o t t o o s u r e at t h e t i m e w h e t h e r sh e s a i d it is in 22 the Intercontinental Bank? 23 89 Q 24 A 25 26 Yes, I r i s h I n t e r c o n t i n e n t a l Ban k. I am not too sure w h e t h e r she m e n t i o n e d t h a t n a m e or not. 90 Q 27 W h e n y o u s a i d t o her, ' w h e r e is t h e m o n e y ' , a c t u a l l y a s k e d h e r w h e r e it w a s ? 28 A 29 91 Q Yes . you 1 S h e t h e n t o l d u s to go a n d c o l l e c t it i n W i n e t a v e r n 2 Street. 3 92 Q 4 A 5 93 Q 6 A 7 94 Q No, d id she? no. Y o u t o l d h e r y o u w a n t e d to c l o s e t h e a c c o u n t ? Correct. S h e s a i d s h e w o u l d a r r a n g e t h a t a n d y o u s h o u l d g o to W i n e t a v e r n S t r e e t a n d c o l l e c t it? 8 9 A 10 95 Q 11 A 12 96 Q 13 T h a t ' s right. You went there and you met a gentleman? Yes, a n d h e g a v e m e a c h e q u e a n d t h a t is it. Did that r e p r e s e n t the e n t i r e b a l a n c e in your a c c o u n t at t h a t s t a g e ? 14 A 15 97 Q 16 Correct. D i d yo u get an y d o c u m e n t s was 17 A 18 98 Q 19 A 20 99 Q saying that your account closed? No. Nothing, just the cheque? Yes . You were s a t i s f i e d that was the full b a l a n c e of your account? 21 22 S h e d i d n o t t e l l y o u w h e r e it a c t u a l l y was, A 23 Absolutely, w e n e v e r at a n y o t h e r t i m e s u s p e c t e d a n y t h i n g to b e q u i t e f r a n k w i t h you. 24 100 Q 25 A 26 101 Q T h a t w o u l d b e 19 94 w h e n Mr. T h a t ' s right, A f t e r Mr. Traynor died? a n d I c o l l e c t e d t h a t m o n e y i n 1995. T r a y n o r 's d e a t h a n d b e f o r e y o u c l o s e d t h e 27 accounts did you make any transactions 28 lodge any m o n e y or w i t h d r a w a ny m o n e y b e t w e e n his 29 death and the closing? or d i d you 1 2 102 Q 3 A 4 103 Q 5 A 7 104 Q A 10 Even roughly by reference to when you f i r s t met Maybe 1974 or 1975, I am just trying to think when we opened the restaurant. 105 Q 12 13 God, I w i l l be quite frank with you, I don't. Mr. Traynor? 8 11 When did you actually open this account, can you remember the date of it? 6 9 No. Mr. Oppermann, I have no more questions to ask you. Sorry, did you want to say something there? A 14 I was only going to say that the £35,000 we gave him . . . . (INTERJECTION). 15 106 Q 16 A Which was this £35,000? This is what I was trying to say, I had some bonds 17 and at that particular period they were sliding, so 18 I cashed them a l l in and gave that £35,000 to 19 Traynor to invest. 20 107 Q 21 Bank draft made out to Mrs. Oppermann (Exhibit 1). 22 A 23 108 Q 24 A 25 109 Q 26 27 I f I could just pass you a copy of an Al lied Irish That's i t . Can you just confirm that for me? (SAME HANDED). That's i t . So you gave that to Mr. Traynor to lodge to your account? A Correct, and that was made up of a cheque that we 28 put in for £17,000 and then the other one we cashed 29 with the Eagle Star here was for £20,000 and we kept 1 £3,000 of that and lodged the £18,000, so that made 2 up the £35,000. 3 MS. MACKEY: 4 Thank you very much Mr. Oppermann and I have 5 no questions for Mrs. Oppermann either. 6 been very helpful. 7 MR. JUSTICE COSTELLO: 9 Thank you Mr. & Mrs. Oppermann. 8 You have We w i l l require you to come in again when the transcript of 10 this evidence has been typed up. 11 typed up in a few days time and we would ask you 12 both to come in just to sign the transcript. 13 send on a copy of i t f i r s t to you i f you want to see 14 it. Thank you very much. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF INTERVIEW I t w i l l a l l be We can H26 OH. HEEHNS Egg is @0505? . i399, b0 0 ■• '. ' •’ • •• ? " . -1i: ■ \‘- *-£ . •’" v V• ■■-«.•*• . * X ' :-' - •••*•'•• • ‘ ..*■. .■ t • • - - ■■•: • •• ' ■' , * r “tv* ’■•'!)*■•£*■ 1 ; y *.u*‘ •ri.ilV -':* : **; • • ,* - ; 1_ ■ - . ___________ ' • ■-•♦•■• •*••----:-----------— *” Could you p l M M i m a p to l«t m lutn tomorrow ■oroing 19th August £1,000 Starling la <60 f n m l l u v Chsqoss la tin s m of Mrs. U l i t o Q p p n u u i , 9 St. Ja m s ’ a TnrtM, UfclAblds, Co. Dublin. Debit tbo cost to O.M.C.T. A/A7 Account. J D T / A J 1 J O H N R O C H F O R D & C O . S ol i c it o rs P. A. Gibbons B.C.L. Telephone 01 - 872 1499 Fax Equity House 16/17 U p p e r O r m o n d Q u a y 01 - 872 1654 D.X.F.C. Email jrochfrd@indigo.ie D ublin 7 Our Ref JR\IN\20581 Your Ref: C\006\MLC\MF 26 November 2001 Ms. Mary Cummins, Solicitor, ^ Ansbacher Tribunal, <=^ 3rd Floor, Trident House, Blackrock, CO. DUBLIN. RE Our clients M r and Mrs. Opperman. Dear Ms. Cummins, Thank you for your letter of the 23rd inst. sending me a copy of the Transcript. This Transcript clearly shows that m y clients gave monies to Mr. Traynor and had no idea where itwas invested. I refer to the Inspector's letter dated 25\10\01 and to the copy documents enclosed with it. I repeat that the Inspectors have no basis upon which to conclude that M r and Mrs. Opperman were clients of Ansbacher and it is clear they never found out about Ansbacher until after the death of the late Mr. J.D. Traynor. M y clients gave evidence to the Tribunal on 10\3\00 and on 25\5\01 Judge Finnegan's Order upon which the Inspectors rely, was granted. M y clients are entitled to their good name. anything that will affect it. Yours faithfully, J O H N R O C H F O R D &CO., VAT NO. FI2905651 1015 The Inspectors should not do Appendix XV (105) Pettit International 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Pettit International. a) Telex of 6 December 1983 - Guinness and M a h o n to G M C T . b) Telex of 6 December 1983 - Guinness and M a h o n to G M C T . c) Telex of 12 March 1982 - Guinness and M a h o n to G M C T . d) Telex of 26 M a y 1983 - Guinness and M a h o n to G M C T . e) Telex of 26 April 1983 - Guinness and M a h o n to G M C T . f) Telex of 27 November 1982 - G M C T to Guinness and Mahon. Correspondence received from or on behalf of Pettit International. a) Letter of 20 December 2001 - Masons Solicitors to Inspectors. b) Letter of 28 February 2002 - Masons to the Secretary to the Inspectors. OQaA ^ 2 3 2 0 9 - M ARS E l 6A 02934305+ v*305 encT cp e»i '2 5 2 0 5 MARS E l TO ! G U IN N E S S FR O M ! 6 U IN N E S 8 + M A H O N D A TE! 6TH A T T N !R E! M IK E P E T T IT PLEA SE IS CAYM AN L TD , TR UST D UB LTN i9 S 3 S H IE L D S IN T E R N A T IO N A L U .S . BAN KCEN TRE, (T H IS DECEM BER, TR AN SFER C L I E N T 'S M AHON D LR S DOLLAR 3 0 ,0 0 0 HOLD B A L L S 8 R I0 G E , IN A D D IT IO N TO (T H IR T Y A /C U IT H D U B L IN OUR « r E A R L IE R THOUSAND A L L IE D ACCOUNT AM. TELEX > REGARDSt M A R T IN KEAN E, 6 U IN N E S S + M A H 0 N 4 3 0 5 25205 GMCT MARS L T D ., US IR IS H D U B L IN . CP E l G D LR S) TO BANK, 28020632. 1 QQA ■ N 252V5 M ARS E l GA 0213*305+ *303 6MCT CP 23205 MARS E l TO t G U IN N E S S FR O H t B U IN N E S S + M A H O N D TE> 6TH A T T N !R E l H IK E P E T T IT PLEASE A /C DECEM BERt ACCOUNT CAYNAN L TD , A L L IE D NO. 1983 US D LR S IR IS H 2 5 ,0 0 0 - BANK, 26020632. RE6ARDS, 25203 GMCT M ARS U N IT E D IN T E R N A T IO N A L M A R T IN K E A N E , G U IN N E S S + M A H Q N 4 3 0 5 TR UST D U B L IN S H IE L D S TR AN SFER U IT H M AHON CP E l L TD , D U B L IN . TO C L I E N T 'S BAN KCEN TRE, U .S . DOLLAR B A L L S B R ID G E , HOLD D U B L IN 4« TQ l M G U IN N E S S t M t , MAHON 6 U IN H E 8 8 + H A H 0 N §49C* 12TH M ARCH TR U S T L TD . D U B L IN i9 S 2 . 1 i I " A TTN t R E t CAYM AN LTD JO H N C O L L IN S E S 6 . P E T T IT i i UN D ER STA N D , U .8 . ON I » I iO T H M A+CH 1 C O N F IR M M IN D L Y REGARDS i t !' t 4 3 0 3 M- 9 2 0 5 ; I: ii 1H C T M ARS CP E lf i D LR S 6 0 ,0 0 0 19S2. R E C E IP T . TR AN SFER R ED TO YOUR A /C A T IR V IN S 00+* 2SQB5 MARS E l &A 02934305+ 4305 6MCt CP 2 5 2 0 3 E l r t A f lS TO I G U IN N E S S hHuns 6 U IN N E S S + M A H 0 N U A IL t 2 6 /S /S J A I I N l - H L: JO H N f it T i l l M AHON C O L L IN S / CAYM AN L T J . «IK £ L IM IT E D S H IE L D S IN T E R N A T IO N A L P IM A S E T H A N U I 'E R A L L IE D 1 K 1 S II US BANK, D LR S 4 * .0 0 0 BANKCENTRE, l-U U < !0 t ,3 2 . h 'l .'t i A R D S t ftA H T IN TR U ST D U B L IN K LA N L, ijU iN N E S H tn A IIO N L T O ,D U B L IN . TO C L I E N T 'S B A l.L S B R ID S E i US DOLLAR D U B L IN t> HOLD A /C ACCOUNT U IT H NO. QQ+* 6fT> ' 2 * p 5 M ARS E l 02934305* 4303 GMCT CP 25205 MARS E l TO i B U IN N E 8 S FR O M I S U IN N E S S + M A H O N D A TE! 2 6 /4 /8 3 A T T N tR E l JO H N P E T T IT M AHON C O L L IN S / CAYM AN L TD , M IK E TR U S T TR AN SFER A L L IE D IR IS H US BANK, D LR S 6 0 < 0 0 0 - BANKCENTRE, TO C L I E N T 'S B A L L S B R ID 6 E , REGARDS, 23205 K IN S 6N C T UAHS NO. CP 4 303 S H IE L D S 2 80 2 06 32 . 4 3 0 3 TELEX IN T E R N A T IO N A L PLEA S E BRENDA L IM IT E D D U B L IN - CP E l SECR ETAR Y TO M .C. KEAN E. US DOLLAR D U B L IN 4 . HOLD A /C ACCOUNT U IT H NO. 7II \ \\ 25X03 MRS fc1 - f i - 6*. ul»l Ma— J J dt /sAilON w TJ , i JG'eJLlfc A1 i ^ U O f c : f i ts MARI iN a EANE % ?ii : Ti i INTERN^ iiONAu. ACCOR JilMS TO UUrf rtCCOiiySt THCilil HA!> jCtN NO LODCEMENT OP APPROX. C^U.UijU :0 X25.U0U HE GENTLY. ;iit LAST -.OOEEriCMi WAS ON 207ii :1A t. -.982 OF * 23*1000.00 Gw,irt> MAHON CAVMAN TRUST.* 25205 r.A R S E l <,305 fci“CT CP . . > M A S O N S Office of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Ltd. „rd 3 Floor Trident House Blackrock t % l i e n§? Co. Dublin For the Attention of: - Your ref c/ pos/ nspm _, ° “r. Df™ K DUBLIN.16400.1 His Honour Judge Sean O ’Leary Ms Noreen Mackey B.L. Mr Paul Rowan FCA Mr Michael Cush S.C. / - 20 December 2001 Dear Sirs PETTIT INTERNATIONAL LIMITED W e are instructed on behalf of Pettit International Limited and EG Pettit & Company in relation to your letter of 14th December 2001 in response to which we write. Since the time of the events addressed in your letter, the ownership and structure of the Pettit group of companies has substantially changed and the contents of your letter are entirely new to the present directors and shareholders of Pettit International Limited and its related companies. It is our clients’ desire to assist the High Court appointed Inspectors and to resolve any possible finding and/or inference which might be considered adverse to Pettit International Limited. Pettit International Limited was established by its then owners in 1974 to undertake the business of providing professional engineering services outside Ireland and the United Kingdom. The directors of the company during the time relevant to your letter were as follows; T. J. Harney, C. A. Odium, T. F. Dwane, P. F. Kelleher, S. F. Kelly, M. L. McNally, C. G. O'Connell, T. J. O ’Donovan. The shareholders of the company during the same time were as follows; T. J. Harney, C. A. Odium, T. F. Dwane, P. F. Kelleher, S. F. Kelly, M. L. McNally, C. G. O'Connell, T. J. O ’Donovan. MASONS 61 Merrion Square Dublin 2 Ireland T +353 (0)1 638 3838 F+353 (0)1 638 3888 DX 216 Dublin www.masons.com LONDON BRISTOL EDINBURGH GLASGOW LEEDS MANCHESTER BRUSSELS DUBLIN HONGKONG GUANGZHOU SINGAPORE P.utnervcti;nos nationalities statedoverleaf Thisoffice>sregulatedbytheLawSocietyofIreland Pettit Internationa! Limited traded as an independent company until 1987. On 31st August 1987 E.G. Pettit & Company acquired 42.8% of the shareholding of Pettit International Limited. On the 2;'d October 1991 E. G. Pettit & Company acquired the remainder of the shares in Pettit International Limited and on 7th October 1991 Pettit International Limited became a subsidiary of Pettit Holdings Limited. In 1997 the current owners ofthe Pettit group of companies took over the entire business by way of management buy-out, establishing Pettit Engineering Group Limited for this purpose in 1997. Pettit International Limited is now owned by Pettit Engineering Group Limited. The former directors and shareholders of Pettit International Limited mentioned above have had no interest in any aspect of the business since that time. The events giving rise to your letter go back almost 20 years and our clients are currently undertaking an analysis of available information. As you will appreciate the effluxion of time since the events you raise may mean that some information is no longer available. However at this time we can give an outline of the underlining circumstances which have given rise to your letter. One ofthe projects on which Pettit International Limited was engaged in the early 1980s as a specialist engineer in design and supervision was the construction of a large cheese manufacturing facility in the United States. That project continued for a number of years and generated approximately US$ 4.5 million in engineering fee income for Pettit International Limited. The fee income was placed on deposit in the bank account to which you have referred before being remitted to Ireland and, as far as the present directors can determine, was fully accounted for in the accounts of Pettit International Limited. At all times Pettit International Limited has maintained its accounts and lodged appropriate copies of those accounts with the Registrar of Companies. W e would emphasis that to the best of the knowledge and belief of the present directors all fee income of Pettit International Limited was generated outside Ireland on international engineering projects and subsequently repatriated to this country. Our clients wish, if possible, to resolve this matter in early course and are happy to provide further assistance for this purpose. W e would be grateful if you would let us know if you wish to consider any further information or clarify any aspects of this matter. It may be appropriate for a meeting to take place to address any issues you may wish to clarify. However, in the light of our clients' initial response you may consider it appropriate to review the significance of your preliminary finding. W e look forward to hearing from you in relation to the foregoing at your early convenience. Finally, for the avoidance of any doubt, we would be grateful if you would treat this letter as notice within 21 days ofthe date of your letter that Pettit International Limited may wish to provide you with a comprehensive written reply to your preliminary conclusion. Yours faithfully, MASONS M A S O N S The Office of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Ltd Your ref C/P08 ° ur ref DS/RK1 Dublin. 17891.1 3rd Floor Trident House Blackrock Co. Dublin For the attention of Ms Frances Gaynor ^ 28 February 2002 Dear Sirs PETTIT INTERNATIONAL LTD. W e thank you for your fax letter of 21 February 2002 to which we write in response. W e have also spoken over the telephone on 20 February concerning the issues raised in our letter of 12 February. W e now write in reply to your letter of 21 February 2002. 1. Background to Submission 1.1 As the Inspectors are aware, the points raised in our letter of 12 February 2002 are of great concern to our client, Pettit International Ltd. Whist we do not wish to labour the point which has been fully set out in our recent letter, the central and fundamental concern is that the Inspectors appear to have reached a Preliminary Conclusion concerning our client and in doing so have determined that their Preliminary Conclusion involves a finding of fact and /or inference which is adverse to our clients interest, reputation or good name. The finding and/or inference which the Inspectors consider adverse to our client's interest has not been specified. Consequently, as we have explained, our client finds itself in great difficulty in seeking to respond to the Inspectors as there has been no allegation against it of malfeasance, wrongdoing or failure by it to comply with any law, regulation or obligation of any nature either in this country or elsewhere. As we have said, from our client’s perspective, the Inspectors’ Preliminary Conclusion that our client was a client of Ansbacher (Cayman) Ltd. (“Ansbacher”) appears to carry with it the presumption of wrongdoing which our client is unable to rebut or address because no allegation has actually been laid against our client. 1.2 The second paragraph of your letter of 21 February 2002 in the last sentence adds to our clients’ sense of unease about the Inspectors’ finding and/or inference which C/, iv I MASONS 61 Merrion Square Dublin 2 Ireland 633 333S F <-353 ■;0' I 633 3SS8 DX 2 16 Dublin vvvvvv.masons.com r-j H0rjGKOUG GUANGZHOU SINGAPORE they consider to be adverse to our client, it is stated in your letter that the Inspectors will consider any further submissions by our client with a view to finalising their conclusion about our client. The Preliminary Conclusion of the Inspectors that our client was a client of Ansbacher has already, insofar as we and our client can determine, been finalised. Consequently it is not understood by our client in what way the Inspectors propose to finalise their conclusion nor is it understood whether the conclusion referred to relates to findings and/or inferences considered by the Inspectors to be adverse to our client or to any other matter. Our client is, regrettably and with respect to the Inspectors, unable to confirm that it has had a real and meaningful opportunity to address any conclusion, finding and/or inference made by the Inspectors concerning our client or its business. Our client is particularly concerned that it has been told in essence that it must surmise for itself in what way its interest, reputation and good name are or may be adversely affected by findings made and / or inferences drawn by the Inspectors. Our client does not raise the foregoing concerns out of any disrespect for the Inspectors or the process of reporting which they are undertaking. At no time has our client sought to obstruct or delay the Inspectors or to obfuscate on any matter within the its knowledge or that of its officers. On the contrary, our client has sought to establish what it is the Inspectors wish to know and to provide such information. As we have previously mentioned, the principal source of our client’s knowledge concerning the matters under investigation by the Inspectors, apart from formal legal issues, is press comment, which we trust the Inspectors agree is not a reliable source of information. Our client is aware that the Inspectors are investigating the activities of Ansbacher with a view to determining the extent (if any) to which that company may have acted wrongfully or illegally in this country in operating accounts and which were or may have been operated in a manner inconsistent with the Irish tax acts and / or other legislation. Our client is also aware that the Inspectors, as part of the remit of their investigation, are seeking to establish the identities of clients of Ansbacher in this country who may have availed of the services of Ansbacher in a manner inconsistent with Irish tax legislation. The Inspectors’ letter of 14 December 2001 provided the first indication to the current directors of Pettit International Ltd. that the company was an account holder with Ansbacher during the early 1980s. Since the Inspectors’ letter of 14 December 2001 our client has endeavoured to investigate the precise circumstances surrounding the operation of the said account. In our letter of 20 December 2001 to the Inspectors our client provided an initial explanation of the operation of Pettit International Ltd.’s business and of the relevant account. Pettit International Ltd. As explained in our letter of 20 December 2001, Pettit International Ltd. was established by its then owners in 1974 to engage in the business of providing professional engineering services outside Ireland and the United Kingdom. The directors and shareholders of the company from its inception until 1987 are listed in our letter of 20 December 2001. W e have also explained the various changes in the shareholding of Pettit International Ltd. (see the first paragraph on the second page of our letter of 20 December 2001) which resulted in a management buy-out in October 1997. Upon the completion of the management buy-out the previous owners of the company from 1974 to 1997 ceased to have any involvement in the management, operation or control of :.he company1, all of which passed to the current directors. Pettit international Ltd. is now owned by Pettit Engineering Group Lid. 2.2 As mentioned, Pettit International Ltd. was set up to operate the international engineering market excluding the United Kingdom and Ireland and for this reason it was entitled to avail of Export Sales Relief on its business and so profits were not subject to Corporation Tax. 3. Pettit Internationa] Ltd.’s Work in United States of America. 3.1 During the early 1980s, our client undertook work in the United States of America on behalf of Express Foods Inc. In the first place our client performed engineering design services for Express Foods Inc. in relation to an existing cheese plant in the state of Vermont, USA in the early 1980s. At the same time our client entered discussions with a subsidiary of Express Foods Inc., Carberry Milk Products, in relation to a proposed Cheese, Whey and Alcohol Plant in the state of California. Our client agreed to perform engineering services in relation to the plant and commenced design work on this project in 1980/1981. A final version of the contract for engineering services to be provided by Pettit International Ltd. on behalf of Express Foods Inc. was executed in July 1984. The contract was entered into between Pettit International Ltd. and Corona Constructors Inc., which company was building the project on behalf of Express Foods Inc. The contract value was in the region of US$3,646 million. In order to provide site supervision and project management services locally in California, Pettit International Ltd. engaged Integrated Project Sen/ices Inc. to act as site supervisor and project manager on the project. The relevant contract between Pettit International and integrated Project Services Inc. was entered into in October 1984. 4. Operation o f Ansbacher Account. 4.1 As a consequence of our client’s professional engineering activities in the United States of America during the early 1980s it was (insofar as the current directors can establish) believed appropriate at that time to establish convenient and accessible US dollar banking facilities. The current directors have not been able to determine why the account was set up. Logic suggests that exchange control restrictions, exchange rate and interest rate fluctuations were factors which, at least in part, motivated the original decision to open an account with Ansbacher. 4.2 A feature of large-scale construction projects such as that on which Pettit International Ltd. were engaged in California is periodic stage payments for work undertaken and the need to employ professionals on site away from home. The Ansbacher account facilitated the operation of our client’s United States-based business in an efficient manner. Money earned by our client in the United States was deposited in the account and expenses incurred in relation to personal, travel and accommodation as well as other expenses incidental to Pettit International Ltd.’s business were defrayed from the account. Fees earned in the United States after deduction of operating expenses and other incidental costs were remitted to Pettit International Ltd.'s bank account in Dublin which was an AIB US dollar hold account. 4.3 As we have previously mentioned the events in question took place approximately 20 years ago and our client is currently undertaking a detailed analysis of all 1 W ith th e e x c e p tio n o f th e F in an cial D irector, S e a n Kelly, w h o re tire d in April 2 0 0 0 Ml available information concerning the account and project in question in conjunction with its auditors in order to establish as precisely as possible the full extent of transactions into and out cf the Ansbacher account. As a matters presently stand our client has determined that receipts into the Ansbacher account amounted to $2,896,315.77 of which sum a total of $2,494,165.77 was remitted from the Ansbacher account to our client's US dollar hold account at AIB in Dublin. The difference between the two sums is accounted for as follows: (i) Bonus payments US$105,397.00 (ii) Unvouched expenses US$10,400.00 (iii) Airfares US$10,747.00 (iv) Interest disbursement US$45,300.00 (v) Bank charges US$2,713.64 (vi) Loan from Pettit International Ltd to Integrated Projects Services Inc. US$10,000.00 Integrated Projects Services Inc. contract payment US$270,000.00 (vii) 4.4 To the extent our client and its auditors can identify any matter relating to the account which may best be addressed with the Revenue Commissioners our client will raise any such matter with the Revenue Commissioners. This process, as we have mentioned, is currently ongoing. 4.5 As we have previously mentioned the fee income from the Californian project was accounted for in our client’s audited accounts at the relevant time. W e note from your letter of 21 February 2002 that we may, over the telephone, have given you to understand that our client had specifically recorded the Ansbacher account in its company records. We regret any misunderstanding on this issue. The point we sought to make was that our client had accounted for the contents of the Ansbacher account in its accounts but the account itself is not specifically referred to in the company records. 4.6 As we have set out above, our client understands that the main focus of the Inspectors’ enquiries in relation to client of Ansbacher concerns clandestine accounts which were used to move money out of Ireland and / or in a manner inconsistent with or in breach of Irish tax laws. Insofar as our client and its directors can determine its account at Ansbacher had none of the relevant characteristics. In particular, our client wishes to re-iterate that before receipt of the Inspectors original letter, they had no knowledge whatsoever of this account. However, after conducting a thorough investigation, the following facts have become clear: 4.6.1 Our client has never denied that it was an account holder with Ansbacher. Once the inspectors informed our client of its Preliminary Conclusion our client confirmed following the above investigations that it was an account holder for legitimate purposes. 4.6.2 At all times Pettit International Ltd. operated the account it held at Ansbacher for normal and lawful commercial purposes and to facilitate its carrying out a large-scale engineering project in California in the early 1930s. 4.6.3 At no time (in so far as the current directors can establish) did Pettit International Ltd. operate anything other than a legitimate bank account with Ansbacher. 4.6.4 At no time did Pettit International Ltd. ever attempted to occlude its identity as account holder for the relevant account. Pettit International Ltd. did not try to hide behind an assumed name - the account was opened in the name of Pettit International Ltd. and operated in the name of Pettit International Ltd. 4.6.5 Our client understands that one of the characteristics of non-resident accounts under investigation by the Inspectors is operation of the account by an intermediary who kept all details of account transactions on behalf of account holders in this country. At no time did Pettit International endeavour to conduct transactions in relation to its account at Ansbacher via any undisclosed or clandestine intermediary or agent. Transactions were effected through standard banking channels, again with no attempt on the part of Pettit International to occlude or obscure the nature and purpose of transactions or its own identity. 4.6.6 Transactions to the account were stage-payments under the above mentioned construction contract and originated in California/Vermont. Transactions out of the account either related to the performance of the engineering contract referred to above by our client or, in relation to the vast majority, were remittances from the Ansbacher account to our client’s AIB US dollar account in Dublin. Thereafter sums remitted to Ireland were audited and accounted for in our client’s relevant annual accounts. 4.6.7 At no time did Pettit International Ltd. transfer any funds from this country to its Ansbacher account. 4.6.8 By virtue of Pettit International Ltd.’s tax exempt status for Corporation Tax, there would appear to be no reason why it would wish to, or benefit from, any effort to deal with its fee income in a manor inconsistent with or in breach of Irish tax legislation (or such legislation in any other relevant jurisdiction). W e enclose with this submission copies of bank statements from Ansbacher from 1 April 1982 to 30 June 1987. There were, in fact, two accounts, a Call Deposit and a Current Account. The Call Deposit account earned interest where as the Current Account was used for payments out of the account. A further record has been located of transactions on the account from July 1987 to 3 December 1991 on which date the account was closed, a copy of which is also enclosed. Our client has made contact with Ansbacher and requested a statement for the period July 1987 to December 1991 which can be provided on receipt to the Inspectors. W e also enclose bank statements from AIB concerning our client’s US dollar hold account operated between 25 November 1980 and 12 October 1988. In our client's respectful submission, the enclosed copies of bank statements verify the explanation of the operation of the account provided above. 5.1 Our client has been unable to determine any impropriety, malfeasance or wrongdoing on the part of Pettit International Ltd in relation to the Ansbacher account which it operated at all times transparently as a regular and legitimate business bank account. 5.2 Should our client identify any transactions in relation to the Pettit International Ltd. Ansbacher account which it is unable readily to reconcile it will, if appropriate, raise the matter with the Revenue Commissioners. 5.3 Finally, we wish to add the very serious concern which our client has as to the damage which could be caused to its reputation if its name is associated with those of parties who have been involved in defrauding the Revenue Commissioners. It is of course vital that the Inspectors do not allow their investigations to operate to cause prejudice to innocent parties such as our client. There is no suggestion at present (of which we or our client are aware) that our client is guilty of any wrongdoing. Whilst Pettit International Ltd. had an account with Ansbacher, the account has none of the characteristics of the accounts in which the Inspectors are (quite properly) interested. In the circumstances, our client asks that the Inspectors take special care to ensure that no ‘collateral’ damage is caused to it as a consequence of the Inspectors’ investigations and report. If it appears to the Inspectors that they wish to raise any question or query, or if they wish to consider any other documentation they consider relevant, our client will endeavour to respond as expeditiously as possible. Yours faithfully, MASONS Encl. Appendix XV (106) Dr Michael Phelan 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Dr Michael Phelan. a) Facsimile of 17 December 1993 - J D Traynor to Henry Ansbacher & C o Limited. b) Letter of 17 December 1993 - Hamilton Ross & C o to IIB. c) Letter of 5 July 1994 - Ca y m a n International bank and Trust C o m p a n y Limited to Joan Williams. d) Letter of 4 July 1994 - Joan Williams to C a y m a n International bank and Trust C o m p a n y Limited. e) Letter of 21 June 1993 - Hamilton Ross & C o to IIB. r- 42 FITZWILLIAM S Q U A R E DUBLIN 2 >ACSX>HLB T8AW8MISSX0W 4 To; Henry Ansbacher & Co. Ltd* *?£’ . Attention; Mr. Andy Love. Date: - From: Traynor. Total, j .d. m 0044 71 626 0839 17th December, 1993. a u . , Dr. Michael Phelan, who has called and collected cash from H anry Ansbacher on previous occasions, will ring you, probably on Tuesday next, with a view to calling to your office at a mutually convenient tine to collect Stg.£5,000 in cash. Dr. Phelan is the holder of British Passport No.269539U and he has said he will bring this with him for identification purposes. ' Arrangements are being made to transfer Stg.£5,050 to your Account at Royal Bank of Scotland, Corporate Banking Office, Lombard Street. I; I would b e grateful if you could make the necessary arrangements to facilitate Dr. Phelan in this way. if there is a problem, perhaps you could telephone me. K ind regards. J.D. Travnor. : .........* " . . . . . . . 1 7 th D a ca a b a r, 1 993* H onan H ad aon d , B a g . * _ C o n o n t a Nrrioiii I c i» h I n t a r e o o t in a n t a l B ank L ia it a d , 9 1 M a r x ia n S q u a r e , POBLXW a ^ V --11 .. ICHi- J.B. Tcav-no-. • . . y . • C w i a yea p l ~ » « x n » g * to t w X w a a p o a s ib la .. to « t » . « S , M O . O O • » ««iolilr 1 br. >: c Royal. H en ry a off'ca i n .o ‘ f o r A c c o iin t * , 1 t C o r p o r a t a .I w n K ft q ; O f f l c a L o n d o n . JtB S S f SOU < * cod at ' « -v». ■ • • •_.» 1C 0 4 0 0 T ’ I H an ry A a a b a o h a r; * C o . L ia it a d r: » < :c s a lic e c w m t'H O * 2 0 0 0 '1 9 0 0 -• . • -• ■ : - P la a a a d i b i t t h a r e o a t ! t o t . . . . , • : r i c : .- p la o a o n B a a l l t o n i o a a A o c o o n t * > * 0 2 /0 1 3 5 4 /8 1 T«r mimaow TOMCO. H M jp«/jujw . * Y o u ra a in e a r a ly , n... ppc . - r .. .. I t w o u ld b a a p p r a o ia t a d I f t h a * a f u n d * c o u ld b a i n t . u , r , - . * d a t s if e .7 0 1 3 7 0 „ Y a a a d a y .n a a e t .2 1 a , • •• » P la a a a d a b i t A /A 2 0 07/0B/94 tMtt 11:80 tWO# _ #*■* PA fc*l«r Qnwdffmni mvvwMM TitoilhMMBaMaaaM TWScPttM n £m v»m vw In t e r n a t io n a l T ra c t O fo o fi Vii FtorixufiB #Q11 -3 5 3 1 -6 6 1 2 -0 3 5 TtoMpktpotDy 3 M y , 1994 JAM /-s - M a.Ioan'W Q H asu CRB pie 42HmriDi«nSqpiie Dublin 2, IreUnd iQ DecrJbea. n r, KHcfc—» M irim M*xy thinks for yoorto . S S m ^ ^ S lo v e liw d ib w eek ft* ihem » w t i » s d sie w d tim e te r the cu h tD b eo o O scted . I niggcit you lodge *e finds to t e Sandiy S«b-Oiw i*iiy teeoait-iW/01062/81. H ave a g o o d b o M » y -w ill c cn tict you upon your rttm n. ♦ Regttds, ft QkwnN*y«Mpramh ' • r ^ iS S S T “ » UNJ s p ^ TO; TBAwarrssiOH cayman I n te r n a t io n a l Bank and T r u s t Company L im ite d . A tte n tio n ! Bat tittt-e Mr. J .A . F u rx e .. Fax Bo± 001 809 9495267 ' to te : 4 tb J u ly , 1994. M X U I - . D ear Jo h n , . , , I wonder can you h e ld mm p le a s e . D r.. M ichael P helan (an o ld C lie n t f o r who* we h av e funds h e r* ) w ishes t o c o l l e c t S t g . e i 0,000 i n c a sh i n London. The l a s t tim e he d id t h i s was i n December l a s t and a t t h a t t i n e we s e t up th e arrangem ent w ith N r. Andy Love in Henry A nsbacher ft Co. i n London. • Knowing th e u s u a l f o r a i n Henry Ansbacher th e r e i s no p o in t i n ate g iv in g th e n a '-re q tie st and X wonder t h e r e f o r e i f you c o u ld p u t th e n e c e ssa ry arrangem ents in p la c e f o r u s . _ As I s a y , he h a s c a lle d o n -s e v e ra l o c c a sio n s p re v io u s ly . Ra i s th e h o ld e r o f B r i t i s h P a s s p o rt No.269539U and would b r in g t h i s w ith b in f o r i d e n t i f i c a t i o n p u rp o se s. Once t h e arran g em en ts a r e i n p la c e X would a sk him t o r in g A nsbacher t o a rra n g e a m u tu ally s u it a b le t i n e f o r him t o c a ll. ' W ith re g a rd t o th e t r a n s f e r o f funds t o Henry A nsbacher t o c o v e r t h i s p erh ap s you c o u ld a d v is e w hether you would p r e f e r t o do th e t r a n s f e r y o u r s e lf and X co u ld th e n a rra n g e w ith XXB t o reim b u rse w hichever Account you I n d ic a te presum ably 02/01062/81 - o r a lte r n a tiv e ly I co u ld a rra n g e t o t r a n s f e r th e £10,050.00 from Im p rest Account- and reim b u rse t h a t A ccount. . i 1 * , I * P le a s e a d v is e i f you can h a n d le and a ls o bow you w ish t o d e a l w ith th e fu n d s. As X am going on h o lid a y f o r about t a n days a t th e end o f t h i s week I would a p p re c ia te h e a rin g from you soon a s p o s s ib le . R egard s, Honan Redmond, Esq., Corporate Services, Irish- Intercontinental Bank Limited, 91 Merrion .Square,. : • •=• - •* * • '• w t e j i * ■•.«’•••'u • n:rr,i'< A.. . • -Dear Ronan, Could you pleaae arrange to transfer 8tg.e8,050.00 as quickly a s possible to Royal Bank of Scotland o>'...incorporate Banklxvgr'’ Offloe i 67.Ujonbard Street'' '•" c a i V London.BC3P 3B&Sort Coda: 16 04 OOT for* Account: ’ 'Y Henry Ansbacher a Co. Limited Account No.20001900 CHAPS Wo. 701570 It is important that these £un3s should be In place by the end of.the week eo -your help-would be appreciated. Please debit the cost to Hamilton Ross Account Mo.02/01354/81. Yours sincerely, . :J+ I For HAMILTON ROSS CO. LIMITED DPC - Please debit A/A20 Appendix XV (107) Ms Marily Power 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M s Marily Power. a) Transcript of evidence of M s Marily Power dated 14 March 2000. b) Undated draft deed of settlement - JA Furze & G M C T . c) Statement of M s Marily Power dated 29 February 2000. d) Guinness and M a h o n statement of 14 March 1978 re G M C T . e) Guinness and M a h o n statement of 31 January 1970 re G M C T . f) Guinness and M a h o n statement of 15 December 1977 re G M C T . g) Guinness and M a h o n statement of 2 February 1978 re G M C T . h) Telex of 19 March 1986 - Guinness M a h o n London to Guinness and Mahon. UNDER OATH ON TUESDAY, 14TH MARCH 2000 I hereby ce rt ify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY BL Sol icito r to the Inspectors MS. M. CUMMINS Interviewee: MS. MARILY POWER WITNESS MS. M. POWER EXAMINATION MR. JUSTICE COSTELLO PAGE 5 - 3 2 MR. ROWAN 33 - 36 MS. MACKEY 37 - 43 1 2 3 4 MR. JUSTICE COSTELLO: 5 Good morning Ms. Power. We w i l l start 6 our interview now. I am Declan Costello and on my 7 right is Ms. Mackey and on my le ft is Mr. Rowan. 8 We, as you know, have been appointed inspectors by 9 the Order of The High Court. This is not a Court, 10 as you know. 11 interview. 12 MS. POWER: Yes. 13 MR. JUSTICE COSTELLO: I t is an interview. 14 This is not a tribunal. This is an Your evidence is going to be 15 taken under Oath and I would ask our s o lic it or now, 16 Ms. Cummins, to administer the Oath to you. 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 FOLLOWS 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Ms. Power, we have received your statement, 6 which you have given us? 7 A. 8 2 Q. Yes. What I want to do is I want to ask you some 9 questions arising from the matters that are raised 10 in the statement and some questions on some of the 11 documents that we have in the case? 12 A. 13 3 Q. Yes. Perhaps, before I go into any detail you might give 14 us some background, your own personal background, 15 when you f i r s t came to Ireland and how you came in 16 contact with Guinness & Mahon in Dublin? 17 you would t e l l us about that, would you? 18 A. Perhaps, Well, I came into contact with Guinness & Mahon in 19 Dublin through a friend in England who knew somebody 20 who worked there. 21 he was married to a friend of mine. 22 4 Q. 23 A. 24 Yes? And that is how I got to Guinness & Mahon. I didn't have any connection with them prior to that. 25 5 Q. 26 A. 27 6 Q. 28 A. 29 He was actually a s o lic it or and Have you been l iv in g in Ireland a l l your life? No, no. Or when did you come to live here? No, I came here - - I lived in England my early years and, as I said in the statement, my mother is 1 American and I have dual citizenship. 2 entitled to be American i f you have one American 3 parent. 4 7 Q. 5 A. 6 You are I am sure you know a l l of this. Yes? And up until the age I was 26 I must have lived there. I did live there for a time. 7 8 Q. 8 A. In America. 9 9 Q. In America? 10 A. Yes. 11 10 Q. Yes? 12 A. Lived where? And I worked there in New York for a bi t and I then 13 - - my parents - - my father was quite a lot older i f 14 you like. 15 11 Q. 16 A. 17 12 Q. 18 A. 19 13 Q. 20 A. He ...(INTERJECTION). Was he English? Well, he was Iri sh English. Yes? He was born in England of Iri sh parents. Yes? And when he retired they enjoyed their horses and 21 they wanted to have a stud farm here. 22 over here and at that particular time I actually 23 went to Australia. 24 I went to Australia and I was in Australia for three 25 years or so. 26 14 Q. 27 A. 28 15 Q. 29 That was at the end of 1960's. Yes? And I enjoyed that very much. Yes? So, they came 1 doing with their stud farm and I helped them out as 2 best I could but I wasn't sure at that stage where I 3 was going to be but I sort of got dug in at that 4 stage. 5 16 Q. 6 A. 7 17 Q. 8 A. 9 18 Q. To Ireland? To Ireland, yes. To l iv in g in Ireland? Yes and ...(INTERJECTION). Yes. We know that you eventually established these 10 trusts and entered into agreements in relation to 11 the trust in 1977. 12 come to Ireland and been l iv in g in Ireland? 13 A. 14 19 Q. 15 A. 16 20 Q. 17 How long before that had you Well, I came to Ireland in the middle of 1970. In the middle of the 1970's? Yes. Two or three years before you entered into this arrangement ? 18 A. Yes. 19 21 Q. Yes. 20 Were your parents carrying on their stud farm in Ireland at that time? 21 A. Yes . 22 Q. What was the name of that stud farm? 23 A. Ashfield. 24 Q. Ashfield? 25 A. Ashfield Stud. 26 Q. Did that continue on for some years? 27 A. No, my father died in 1978 . 28 Q. I see? 29 A. And ...(INTERJECTION) 1 26 Q. 2 A. 3 27 Q. 4 5 A. I see? We stopped not long after that. Because you yourself opened a stud farm, did you not? You started a stud farm? Yes. Well, basically I bought horses in partnership 6 with a friend of mine and we called i t Suma Stud. 7 We actually had no premises. 8 28 Q. 9 A. 10 29 Q. 11 A. 12 30 Q. I see? And ...(INTERJECTION). I see? But i t has grown on since then. I see. No, i t is just I want to get clear there was 13 - - your parents had a stud farm and had land, 14 presumably? 15 A. 16 31 Q. 17 A. 18 32 Q. 19 A. 20 33 Q. Yes? 21 A. Yes. 22 34 Q. 23 A. 24 35 Q. Ashfield? 25 A. Ashfield. 26 36 Q. 27 A. 28 37 Q. 29 Yes. Where was that? Where I live now. Yes? I t is near Navan. What was the name of that house? I t is Ashfield. Yes? Bow Park. Yes? 1 38 Q. 2 A. 3 39 Q. 4 A. 5 40 Q. 6 A. 7 41 Q. Yes. With your mother? I s t i l l live there. You s t i l l live there? Yes. You have been l iv in g there since you returned from . . . (INTERJECTION)? 8 9 A. 10 42 Q. 11 A. 12 13 Did you live there then after your father died? I live with my mother. With your mother there? Yes, I am one of four children and the others - - I have two brothers in the States. 43 Q. Yes. I just want to get clear, the ownership of the 14 land in Ashfield is that yours or is that your 15 mothers ? 16 A. 17 44 Q. 18 A. 19 45 Q. 20 No, i t is my mothers. I t is your mothers? Yes. However, you carry on this stud farm there on the land, is that right? 21 A. 22 46 Q. 23 A. 24 47 Q. I carry on a stud farm now on her land, yes. On her land? Yes. I want your assistance now about the contacts you 25 made and about the establishment of a trust in 26 the Cayman Islands. 27 decide or consider doing such a thing as a result of 28 the fact that you became entitled to an inheritance 29 in the United States? Was this as a result - - did you 1 2 48 Q. 3 A. 4 49 Q. 5 A. Is that right? Yes. Would you t e l l me a l i t t l e bi t about that? Well, this was an inheritance. My mother was the 6 last of a - - she was the only remaining person i f 7 you like. 8 young. 9 last of ...(INTERJECTION). She had a sister who died when she was Her mother had no sisters and she was the 10 50 Q. Of her family? 11 A. Of her family. 12 51 Q. 13 A. 14 52 Q. 15 A. Yes? Until she had the four of us. Yes? And this trust was established for her by - - I don't 16 even know. 17 think i t was from the - - I don't even know which 18 side of the family i t was from. 19 53 Q. 20 A. 21 54 Q. 22 A. I think i t was a cousin of her - - I Yes? But i t was established back in the 1930's. Yes? And at the time i t was always felt that she was the 23 last person and she would be the final recipient i f 24 you like. 25 55 Q. 26 A. I t was to be dispersed then. Yes? But, in fact, there was a different view taken by 27 solicitors, lawyers, in New York and they decided i t 28 should be sp lit and that was when we came into i t . 29 56 Q. Yes? 1 And a l l the family members who were existing at the 2 time received an equal portion of this trust. 3 57 Q 4 A 5 Yes. You became entitled to a part? So, I became - - at that stage I didn't know - - I mean we always thought i t was my mothers. 6 58 Q 7 A 8 59 Q 9 A 10 60 Q 11 A 12 61 Q Yes? We regarded i t as hers in fact. Yes. However, you became entitled to a share? I became entitled to my share. In this trust? Yes . I t was as a result of this you approached 13 Guinness & Mahon then with a view to taking, giving 14 you, advise in relation to the money that you were 15 getting? 16 A No, I didn't. I f I - - to be honest none of this - ­ 17 how can I put it? 18 I am not very good on financial matters. 19 s ittin g here. 20 62 Q 21 A Somebody somewhere in America - ­ Thus I am Yes? Somebody somewhere told me that i t was an idea for 22 me to put this money into - - keep i t in dollars. 23 wasn't sure at the time whether I was going to stay 24 in Ireland or whether I was going back to America or 25 what I was going to do. 26 63 Q 27 A I Yes? I don't even know how Guinness & Mahon's name came 28 up other than the fact that this person said that 29 they had a Bank in Ireland, where I was l iv in g, and 1 also in the Cayman. 2 whether i t was from Morgan Guarantee or who i t was 3 who f i r s t got in touch with Guinness & Mahon but I 4 wasn't in touch with them here un til after the thing 5 was established over there. 6 64 Q. 7 A. 8 65 Q. 9 10 So, I do not even know who - ­ Where did you get in touch with them then? Sorry? Where did you get in touch with them then? I mean they must have ...(INTERJECTION)? A. Well, somebody somewhere in the States, who was 11 distributing or dispersing this on my behalf, they 12 made the arrangements there. 13 66 Q. 14 A. From New York. 15 67 Q. From New York? 16 A. 17 68 Q. 18 19 Where? Yes. However, they must have been in touch with you in t e l l i n g you about i t , were they? A. Yes, I am sure they were. I just honestly - - as I 20 said somebody must have said that and I really don't 21 know who i t was. 22 69 Q. 23 A. Yes. 24 70 Q. Yes. 25 However, you mentioned earlier about a s o lic it or who is married to a friend of yours? 26 A. 27 71 Q. 28 A. 29 However, you must have agreed to it? Yes. How did he come into the picture? Well, I asked him where he would suggest that I went. 1 72 Q 2 A 3 73 Q 4 A 5 74 Q Yes. Did you go to Guinness & Mahon? I did subsequently, yes. When was the f i r s t time you went to Guinness & Mahon in Dublin here? 6 7 And he said Guinness & Mahon. A 8 I would imagine i t was sometime after this trust was established in 1997. 9 75 Q 10 A 11 76 Q 12 A 13 77 Q 14 A 15 Yes ? 1998 . Yes ? Early 1998. We have correspondance ...(INTERJECTION)? I only know what I have read since because I only happen to have those things l e ft . 16 78 Q 17 A 18 79 Q 19 A 20 80 Q MS. MACKEY: 1977 or 1978, is it? Yes . MS. MACKEY: Yes. Yes . MR. JUSTICE COSTELLO: 21 The letters which we have, which I think you gave us, 22 are April 1977? 23 A 24 81 Q 25 A 26 82 Q 27 Right. Would that be correct? I am sure i t is i f that is . . . (INTERJECTION). Was that the f i r s t time that you personally made contact with Guinness & Mahon here in Dublin? 28 A 29 83 Q Yes, i t would be. I want you to t e l l me what you did? 13 Did you go into 1 2 3 84 Q. 4 A. Martin Keane. 5 85 Q. Martin Keane? 6 A. 7 86 Q. 8 Yes. Who did you see? Yes. Was Mr. Keane the person that you dealt with in Guinness & Mahon? 9 A. 10 87 Q. 11 A. 12 88 Q. 13 A. 14 89 Q. 15 A. 16 90 Q. 17 Yes. A l l the time? Yes. Did you have your own s o l ic it o r at the time? No. Did you have your own accountant at the time? No. You were dependent entirely on what Mr. Keane told you in relation to this transaction? 18 A. 19 91 Q. 20 A. 21 92 Q. 22 A. 23 93 Q. 24 A. 25 94 Q. You must have been told something by him about it? 26 A. I don't remember anything that I was told about i t 27 28 29 Yes. What did he t e l l you about discretionary trusts? I don't remember. Sorry? I do not remember anything. Had you ever heard of discretionary trusts before? No. by him, you know. 95 Q. I can't t e l l you. I mean . . . (INTERJECTION). This correspondance that you have given us, have you 1 A. I just glanced through i t . As I say I don't really 2 understand i t . 3 of passing over things to other people. 4 96 Q. 5 Were you not told what the effect of this arrangement was to be? 6 A. 7 97 Q. 8 A. 9 Well, I understood how i t was to work. Te l l me what you understood? Well, that I had these funds there and they would be able to receive them here and I could withdraw the 10 11 I mean I have a habit, i f you like, money here in Ireland. 98 Q. 12 When you say; "they would receive them here" that is Guinness & Mahon? 13 A. 14 99 Q. 15 A. 16 100 Q. Yes. Would receive them here? Yes. You understood that the funds would be in the 17 Cayman, that they would be transferred to Dublin, 18 and that you could use them in Dublin? 19 A. 20 101 Q. 21 A. 22 102 Q. Yes. That was your understanding? Yes. Could I just go back a l i t t l e bi t in relation to the 23 trust funds that you became entitled to? 24 remember how much was involved? 25 were coming into? 26 A. 27 103 Q. 28 A. 29 104 Q. Do you How much money you Well ...(INTERJECTION). About? Well, I think there is - - i t was a l l in shares. Yes. However, the value, the approximate value? 1 2 105 Q. 3 A. 4 1 0 6 Q. 5 Dollars? Yes. T h a t you, as o n e o f t h e b e n e f i c i a r i e s , were entitled to ? 6 A. 7 107 Q. 8 A. 9 108 Q. Yes. T h e y w e r e in s h a r e s ? Yes. Do yo u r e m e m b e r w h a t was the t r a n s a c t i o n ? W ere the s h a r e s t o b e t r a n s f e r r e d d o w n to C a y m a n ? 10 11 A. 12 1 0 9 Q. 13 A. 14 110 Q. I t h i n k t h a t is it, Yes. yes. T h e y w e r e to b e ...(INTERJECTION)? I t h i n k t h a t is w h a t is s a i d in t h e p a p e r s t h e r e . Yes. T h e y w e r e to b e t r a n s f e r r e d t o C a y m a n . 15 do you r e m e m b e r about this Jumelol company? 16 remember about this company been established? 17 A. 18 111 Q. 19 A. Do y o u Yes. Tell me about that? Well, j u s t t h a t t h e y t o l d m e t h a t it w o u l d b e p u t into a company, 20 Then 21 112 Q. 22 A. Yes. 23 113 Q. Yes. 24 A. 25 114 Q. 26 A. 27 115 Q. 28 A. 29 1 1 6 Q. w hich I could rename, w h i c h I did. W h i c h you did? The shares w o u l d be put into the c o mpany? Y e s or, as I say, w h a t e v e r w a y t h e y w o r k it out. Yes? T h e r e w a s -- I t h i n k it w a s a t r u s t c o m p a n y . Yes? J u m e l o l Trust. Y o u h a v e g i v e n us a d o c u m e n t h e r e Ms. Power which 1 2 3 117 Q. 4 A. 5 118 Q. 6 A. 7 1 1 9 Q. 8 A. 9 120 Q. A n d who the trustee was? Yes. Do yo u r e m e m b e r that? Not really. Yes? I l e f t it a l l t o the m. Yes. T h e f u n d s w e r e to b e -- t h e s h a r e s w e r e to b e 10 t r a n s f e r r e d to Cayman. 11 f u n d s w a s to b e s e n t to D u b l i n , 12 A. 13 121 Q. 14 A. 15 122 Q. 16 A. 17 123 Q. 18 A. 19 124 Q. If y o u ...(INTERJECTION)? If I n e e d e d it. If y o u n e e d e d it? Yes. A n y time you n e e d e d funds the y came to Dublin? Yes. Perhaps, w e c a n j u s t h a v e a l o o k at t h e d o c u m e n t s , just to i d e n t i f y them? 21 The D e e d Of S e t t l e m e n t? 22 Deed Of Settlement, 23 1 )? A. 25 125 Q. 26 is t h a t r i g h t ? Not necessarily. 20 24 The income the n from the C a n y o u se e w h a t is c a l l e d This was a draft w h i c h was sent to you Yes. D o y o u se e t h e r e tha t: " T h i s is i n d e n t u r e o f S e t t l e m e n t m a d e between John Andrew Furze..." 27 28 A. 29 1 2 6 Q. Yes. T hen: (Exhibit "...of the one part and Guinness Mahon Cayman Trust Limited, a company i n c o r p o r a t e d u n d e r t h e laws, o f t h e o t h e r p a r t ." 1 2 3 4 D i d y o u k n o w w h o Mr. 5 No. 6 127 Q The c o r r e s p o n d a n c e indic a t e s that an a p p o i n t m e n t was 7 made 8 m e e t i n g him? 9 A Furze was? f o r y o u to m e e t Mr. Furze. Do y o u r e m e m b e r I d o n ' t a c t u a l l y r e m e m b e r m e e t i n g him. S ince all 10 t h i s h a s h a p p e n e d I h a v e s e e n f r o m t h e p a p e r -- I 11 r e m e m b e r -- I t h i n k y o u w i l l 12 established before 13 128 Q 14 A I m e t him. Yes? I was t o l d by Gui nn e s s & M a h o n in D u b l i n t h a t h e w a s c o m i n g o ver. 15 16 129 Q 17 A 18 130 Q 19 A Yes ? A n d w o u l d I l i k e t o m e e t him. Yes ? A n d s i n c e I h a d h a d c o r r e s p o n d e n c e it s e e m e d a c i v i l t h i n g t o do. 20 21 131 Q 22 A 23 Yes? B u t I s e r i o u s l y do n o t r e m e m b e r . I couldn't tell y o u w h a t h e l o o k e d like. 24 132 Q 25 A Or the c o n v e r s a t i o n ? I c a n ' t e v e n -- I see f r o m t h a t t h a t I did. I h o n e s t l y d o n ' t r e m e m b e r m e e t i n g him. 26 27 find this was actually 133 Q Yes. However, w h a t I w a s w o n d e r i n g was, 28 e x p l a i n e d to y o u tha t, i n fact, 29 s e t t l o r of this trust, t h i s Deed, w a s it you were not the this I n denture Of 1 Settlement, 2 t o y o u w h y t h i s w a s t o b e so? 3 A. No, t h a t Mr. Furze was? Was that explained I j u s t u n d e r s t o o d t h a t -- I d i d ask. I remember 4 asking somebody but they said that that was the way 5 the y did things. 6 134 Q. Yes. 7 A. Yes. 8 135 Q. 9 A. 10 1 3 6 Q. 11 A. 12 137 Q. S o m e b o d y in G u i n n e s s P r o b a b l y Mr. K e a n e then, & Mahon told you that? w a s it? I imagine. Yes? He w a s t h e o n e I s p o k e t o a l l t h e ti m e . Yes, yes. T h e d o c u m e n t s then , that you have 13 f o r w a r d e d to us, 14 d r a f t l e t t e r o f w h o w e r e to b e t h e b e n e f i c i a r i e s of 15 the trust. 16 b e i n g t o ld . 17 be the b e n e f i c i a r i e s , 18 A. 19 138 Q. 20 A. 21 1 3 9 Q. 22 A. 23 140 Q. 24 A. 25 Well, Do y o u r e m e m b e r t h a t ? Do yo u r e m e m b e r B e i n g g i v e n a d r a f t as t o w h o w e r e to do y o u r e m e m b e r ? I know that that happened, yes. That was part of the a r r a n gement? Yes. A n d that you w ere one of the pe o p l e ? Yes. W h o w a s to b e t h e b e n e f i c i a r y ? T h a t w a s t h e o b j e c t of h a v i n g t h e m o n e y in, kn ow. 26 141 Q. 27 A. Yes. 28 142 Q. Yes. 29 show then that t h e y sent you on a It is w a s you for m y benefit. For your b e n efit? I w o u l d l i k e y o u n o w j u s t t o l o o k at s o m e 1 Guinness 2 t h e w i t n e s s t h e f a c i l i t y l e t t e r of 3 t h e 2 6 t h F e b r u a r y 1979. 4 T h a n k you. 5 143 Q 6 A 7 144 Q 8 A 9 145 Q & M a h o n in F e b r u a r y 1979. ( E x h i b i t 2) (Same h a n d e d ) ? Do y o u se e it r e f e r s t o y o u as t h e b o r r o w e r ? Yes . That the amount you were b o r r o w i n g was £24,500? Yes . T h e t e r m s a r e se t o u t a n d h o w t h e l o a n w a s to b e d r a w n d own. 10 W o u l d you hand Do y o u s e e it s a y s h er e : "The funds h a v e a l r e a d y b e e n m a d e a v a i l a b l e to y o u b y w a y o f a d r a f t in f a v o u r of S t e e n O ' R e i l l y T r u s t A c c o u n t ." 11 12 13 14 15 W h a t is S t e e n O ' R e i l l y T r u s t A c c o u n t ? A 16 T h e y w e r e s o l i c i t o r s in N a v a n w h o w e r e a c t i n g o n b e h a l f of m e in t h e p u r c h a s e o f t h e lan d. 17 146 Q 18 A 19 147 Q 20 A 21 148 Q 22 A 23 You were buy i n g land? Yes . Yes. W a s t h a t in r e l a t i o n to A s h f i e l d ? No. It w a s No, separate? because I was not an Irish citi z e n and wasn't a r e s i d e n t at t h e t i m e . . . 24 149 Q 25 A Yes ? .... t h e r e w a s a t h i n g m o o t e d t h a t n o b o d y w o u l d b e 26 a l l o w e d to b u y l a n d u n l e s s t h e y h a d c o m p l e t e d 27 agricultural training. 28 150 Q 29 A Yes? 1 151 Q 2 A So, not kn o w i n g w h e t h e r or not m y p ar e n t s were g oing 3 t o s t a y in I r e l a n d , 4 in Ireland, 5 came in if you o w n e d l a n d yo u w e r e g o i n g to be 6 a l l o w e d to b u y m o r e . 7 152 Q 8 A 9 or m y m o t h e r was g o i n g to s t a y I s a i d at t h e t i m e t h a t -- b e f o r e t h i s Yes? A n d so, therefore, I bought a small little place. It is o n l y e i g h t a c r e s . 10 153 Q 11 A 12 154 Q 13 I see? J u s t n e a r us. Yes. It s a y s in t h e n e x t p a r a g r a p h : "Purpose: The funds have bee n made a v a i l a b l e in t h e f o r m o f b r i d g i n g f i n a n c e t o a s s i s t y o u in t h e p u r c h a s e of e i g h t a c r e s at J o h n s t o w n , Co. M e a t h ." 14 15 16 17 T h a t is c o r r e c t ? 18 A 19 155 Q Yes . T h e n it d e a l s w i t h i n t e r e s t . se v e n , 20 over the page, Then in p a r a g r a p h it r e f e r s t o "Security": "As s e c u r i t y f o r t h e l o a n w e s h a l l require your solicitor's undertaking h o l d i n g the T itle Deeds of the lands b e i n g p u r c h a s e d to o u r o r d e r . " 21 22 23 24 In y o u r s t a t e m e n t 25 t h o u g h t t h e r e w a s o t h e r s e c u r i t y as w e l l, 26 t h a t w h i c h is s t a t e d t h e r e , 27 28 29 A I a m sor ry , y o u r e f e r to t h e f a c t t h a t y o u apart is t h a t n o t so? I don't understand? from 1 157 Q Y o u g o t a loan, 2 there? 3 3) 4 A 5 158 Q 6 A 7 159 Q 8 A 9 160 Q 10 A 11 161 Q 12 A 13 162 Q 14 A 15 163 Q 16 A 17 164 Q 18 y o u say, o n p a g e 4. H a v e y o u g o t it Have you got your s t atement there (Exhibit Yes . If y o u l o o k at p a g e 4 o f y o u r s t a t e m e n t ? It is n o t w r i t t e n o u t l i k e tha t. Is it n o t ? Could you give the witness a copy? If y o u c o u l d j u s t t e l l m e w h a t it says. "I g o t a l o a n o f £ 2 4 , 5 0 0 " ? Yes . " W h i c h was l a t e r i n c r e a s e d to £ 3 1 , 0 0 0 " ? Yes . "From Guinness & M a h o n in D u b l i n " ? Yes . In r e l a t i o n ...(INTERJECTION)? It is al l r i g h t , I h a v e it. I c a n n o t r e a d a c t u a l l y t h e w o r d s her e, "to p u r c h a s e the land"? 19 A 20 165 Q Yes . "I t h i n k t h a t t h e d e p o s i t t h a t I h a d in the 21 C a y m a n I s l a n d s w a s u s e d in s o m e w a y t o p r o v i d e 22 collateral 23 A 24 16 6 Q 25 A for this loan"? Yes . Tell me what you consi d e r e d was the situation? Well, I thought that they were lending me the m o n e y a g a i n s t w h a t was in 26 ...(INTERJECTION). 27 167 Q In t h e C a y m a n I s l a n d s ? 28 A In t h e C a y m a n I s l a n d s . 29 168 Q Yes . 1 2 Yes. 3 to D u b l i n . I w o u l d j u s t l i k e to y o u t o l o o k at s o m e 4 documents. W o u l d y o u l o o k at t a b 6 ? 5 o f t h e 1 4 t h M a y -- so rry , 6 t h e 1 4 t h M a y 19 78. 7 A 8 170 Q 9 In f a c t Ms. Power money had been transferred it is a l e d g e r a c c o u n t of ( E x h i b i t 4 ) (same H a n d e d ) ? T h a n k you. Sorry, it is M a r c h 1978. T h e p h o t o s t a t is d i f f i c u l t t o r e a d b u t w o u l d y o u l o o k at t h e t o p ? 10 was the G u i nn e s s M a h o n 11 y o u se e t h a t on t h e l e f t - h a n d s i d e ? 12 A 13 171 Q 14 A 15 172 Q 16 A 17 173 Q 18 A 19 174 Q It is a l e t t e r ( C a y m a n Tr u s t ) The account Account. Do Yes . It w a s in I r i s h p o u n d s , su n d r y sub account? Yes . Y o u se e t h e r e Ms. M a r i l y B. Power? Yes . T h e r e is a s u m o f £ 1 , 0 0 0 d e b i t ? Yes . D o e s t h a t n o t a p p e a r as i f y o u d r e w o u t £ 1 , 0 0 0 from this company? 20 21 A 22 175 Q 23 Yes . W o u l d I be c o r r e c t in s a y i n g that yo u d i d d r a w m o n e y o u t of t h e a c c o u n t in D u b l i n f r o m t i m e t o t i m e ? 24 A 25 176 Q Yes . Did you notice that the account was not in your name 26 b u t w a s in t h e n a m e of G u i n n e s s M a h o n 27 Limited? 28 A 29 177 Q ( C a y m a n Tr us t) No. W a s it i n a n y w a y e x p l a i n e d to y o u t h a t t h e a c c o u n t 23 1 in D u b l i n w o u l d not be in y o u r n a m e e v e n t h o u g h you 2 c o u l d b e e n t i t l e d to d r a w o n it? 3 A. 4 i n m y nam e. 5 178 Q. 6 A. 7 17 9 Q. Did you obtain statements? Yes. Y o u d i d m e n t i o n to us t h a t y o u w o u l d p r o d u c e s o m e statements. 8 9 I thought that the statements that came to me were A. No, Have you got a ny s t a te m e n t s ? I d i d n ' t b r i n g t h e m b e c a u s e I u n d e r s t o o d -- I 10 t h o u g h t a c t u a l l y yo u w o u l d h a v e c o p i e s of e v e r y t h i n g 11 here . 12 180 Q. 13 14 No, no. I a m a f r a i d Ms. P o w e r we w o u l d n e e d all the d o c u m e n t s t h a t y o u h a v e in r e l a t i o n t o t h i s ? A. 15 The s tatements that I have are from Guinn e s s or t h e C a y m a n I s l a n d s . 16 181 Q. 17 A. 18 182 Q. Yes. W e w o u l d r e q u i r e t h o s e I a m a f r a i d Ms. 19 A. Yes. No, 20 183 Q. 21 A. Yes? Not f r o m her e. Power? t h a t is al l r i g h t . Y o u c a n g i v e us t h e m ? I h a v e n ' t got t h e m w i t h m e b ut I c a n g e t t h e m fo r you. 22 23 184 Q. 24 A. 25 185 Q. 26 Yes? M y a c c o u n t a n t h a s t h e m at t h e m i n u t e . Yes. I w a n t yo u to give us all the s t a t e m e n t s that you have o b tained from the Cayman Islands? 27 A. 28 1 8 6 Q. 29 & Mahon Yes. But also any statements that you m a y have obtained 1 There are some statements, 2 3 187 Q 4 A 5 yes. Yes ? As I say I t h o u g h t that you h a d them. t h a t y o u h a d b e e n at t h e B a n k a n d y o u h a d a l l t h o s e . 6 188 Q 7 A 8 189 Q 9 No. We require those from you? Yes . In o t h e r w o r d s , w h a t I w a n t y o u t o g i v e us Ms. Power is e v e r y t h i n g y o u h a v e ? 10 A 11 190 Q 12 A 13 191 Q 14 A 15 192 Q Yes . In r e l a t i o n to t h i s m a t t e r ? Yes . Both from Cayman Islands and from Dublin? Yes . V e r y w e l l t h e n. T h e n t h i s is a d r a w i n g o u t f r o m 16 t h i s a c c o u n t b y you. 17 n o t d e l a y w i t h it, 18 a n o t h e r p a y m e n t o u t of £ 50 0 . 19 at it a n d i d e n t i f y it. 20 A Yes. 21 193 Q Yes? 22 A 23 194 Q J u s t m a k e it out. 25 the A 27 195 Q 28 o f t h e 3 1 s t J a n u a r y 1979, of If y o u w o u l d j u s t l o o k ( E x h i b i t 5) (Same H a n d e d ) ? W o u l d y o u j u s t l o o k at t w o o t h e r A t t a b 7, p l e a s e Ms. 1 5 t h D e c e m b e r 1977. (Exhibit Cummins? It is 6 ) (Same h a n d e d ) ? Yes . T h i s is t h e s a m e a c c o u n t . (Cayman Trust) A I need A d i f f e r e n t w a y again. documents now? 26 T h e r e is a n o t h e r one, T h e y a r e s t i l l s p e l l i n g m y n a m e w r o n g I see. 24 29 I understood Limited? If y o u s e e G u i n n e s s M a h o n 1 196 Q 2 A 3 197 Q 4 A 5 198 Q 6 A 7 199 Q 8 A 9 20 0 Q 10 A 11 20 1 Q 12 A 13 202 Q 14 A 15 20 3 Q 16 A 17 204 Q 18 A 19 20 5 Q 20 A 21 206 Q Yes . It is t h e 1 5 t h D e c e m b e r 1 9 7 7 ? Yes . Do y o u se e t h e 1 5 t h D e c e m b e r r e J u m e l o l ? Yes . £2,500? Yes . T h a t is a c r e d i t ? Yes . T h a t is a p a y m e n t From Jumelol, in b y you? yes. It is a p a y m e n t into Jumelol? Yes . To J u m e l o l 's a c c o u n t ? I n e v e r u n d e r s t o o d it w a s c a l l e d J u m e l o l o v e r h e re . Yes ? I m e a n it w a s m y nam e . It w a s y o u r n a m e ? Yes . However, w h e t h e r it w a s J u m e l o l or w h e t h e r it w a s in 22 y o u r name , 23 is t h a t n o t r i g h t ? 24 A Well, there was a payment in b y yo u of £2,500, I w o u l d h a v e to c h e c k m y o w n t h i n g s . I mean, 25 as I said, 26 t h e C a y m a n s a n d I w o u l d w i t h d r a w it h e r e . 27 p o s s i b l e i f I h a d b e e n p a i d s o m e t h i n g t h a t I p a i d it 28 into that account, 29 I a m j u s t w o n d e r i n g -- y o u s e e t h e n e x t p a g e, t h e m o n e y c a m e in f r o m J u m e l o l T r u s t in 26 It is yes. if y o u 1 c o u l d g i v e Ms. 2 J a n u a r y 1978. 3 T h a n k you. 4 208 Q Power the next page please? ( E x h i b i t 7) (Same H a n d e d ) . Do y o u se e on t h e 2 3 r d J a n u a r y -- s o r r y t h e p a y m e n t 5 is t h e 2 3 r d J a n u a r y b u t t h e v a l u e is t h e 6 15th December? 7 A 8 209 Q 9 A 10 21 0 Q 11 A 12 21 1 Q 13 14 Yes . T h e r e is t w o s u m s o f £ 2 , 5 0 0 p a i d in? Yes . T h a t is £ 5 , 0 0 0 p a i d in? Yes, I s e e that . I am just w o n d e r i n g did you p a y m o n e y into this account A 15 It is f r o m t i m e to t i m e ? I k n o w I r e c e i v e d s o m e m o n e y f r o m t h e s a l e of shares. 16 212 Q 17 A 18 21 3 Q I a m sor r y . I am sorry? Yes . T h i s is a d e b i t . I am sorry. I h a v e m i s r e a d it. 19 T h i s is a d r a w i n g out. 20 in, 21 r e m e m b e r d i d y o u p a y in f r o m t i m e t o t i m e m o n e y i n t o 22 this account other than 23 A 24 214 Q 25 A Yes, was a payment in. The other one was a draw i n g I am just wondering, . . . (INTERJECTION)? I m i g h t h a v e p a i d in a s m a l l a m o u n t . Yes ? I k n o w o n e t h i n g I d i d p a y i n t o it w a s a c t u a l l y s o m e 26 A u s t r a l i a n shares that I received. 27 some that 28 21 5 Q 29 A can you Yes? I had from Australia. I s o l d them, 1 2 1 6 Q. 2 A. 3 217 Q. 4 A. 5 218 Q. 7 A. 8 2 1 9 Q. 9 A. 11 22 0 Q. 12 A. 13 22 1 Q. 15 A. 16 222 Q. 17 A. W h y did you pay & Mahon? T o h a v e it t h e r e I s u p p o s e . Did you not h ave an o r d i n a r y b a n k ac c o u n t in D ublin I h a d a b a n k a c c o u n t in N a v a n , yes. In N a v a n ? Yes, I did. I t h i n k it w a s b e c a u s e it w a s in W a s it i n f o r e i g n c u r r e n c y ? It w a s i n A u s t r a l i a n d o l l a r s , The pa y m e n t Well, yes. in is -- it is a n a c c o u n t i n I r i s h I w o n d e r can that be right, do you think? it c a m e in h e r e as A u s t r a l i a n d o l l a r s a n d I w o u l d h a v e p a i d it i n t o t h e r e . 22 3 Q. Did you have other funds that from time to time you m a y have received and then paid into this account? 21 A. 23 I w o u l d have had ve r y small things. I u s e d to m a k e a v e r y small amount in journalism. 24 224 Q. 25 A. 26 22 5 Q. 27 29 W h y w a s it p a i d i n t o t h a t a c c o u n t ? pounds. 19 28 Yes. f o r e i g n c u r r e n c y t h a t I d i d it. 14 22 Yes? somewhere? 10 20 I k n o w t h a t w a s p a i d in. it i n t o t h e a c c o u n t i n G u i n n e s s 6 18 Y o u p a i d it in? Yes? A n d I m a y h a v e p a i d t h o s e in. Yes. Wh y w ould you pay them into this account r a t h e r t h a n y o u r o w n a c c o u n t in N a v a n ? A. Well, I n e v e r h a d v e r y m u c h in m y o w n a c c o u n t in Navan. 1 2 2 6 Q. Did you t h i n k there was a n y a d v a n t a g e in p a y i n g it i n t o t h i s a c c o u n t ? 2 3 Did you find any advantage? A. 4 I c a n ' t r e a l l y a n s w e r t ha t . I don't really know why I p a i d it in. 5 227 Q. 6 A. Well ...(INTERJECTION)? If t h a t w a s t h e t i m e w h e n I w a s p a y i n g o f f t h e l a n d 7 or w h a t e v e r I m i g h t h a v e p u t it i n f o r t h a t r e a s o n 8 because 9 too expensive. 10 228 Q. I d i d p a y o f f s o m e a n d t h e n I d e c i d e d it w a s T h e a c c o u n t w h i c h y o u r e g a r d e d as y o u r m o n e y , 11 w h e t h e r it w a s in t h e n a m e o f J u m e l o l or y o u r o w n 12 a c c o u n t in G u i n n e s s 13 interest. 14 income tax that you had e a r n e d on this? 15 A. & Mahon, obviously earned Did you r eturn the int e r e st on your I d o n ' t r e a l l y know that. I a m n o t s u r e of t h a t at 16 all. 17 m o n e y that 18 w e r e p a i d a l r e a d y in t h e C a y m a n I s l a n d s . 19 2 2 9 Q. I u n d e r s t o o d that m y t axes h a d b e e n paid. the interest? 21 A. P r o b a b l y not. 22 23 0 Q. Probably not? 23 A. 24 23 1 Q. 25 Yes. Yes. to. 26 A. 27 232 Q. I u n d e r s t o o d the taxes Does that m e a n then that you did not re t u r n the taxes, 20 I was receiving, The T h e r e is a n o t h e r d o c u m e n t It is at t a b f i v e p l e a s e I want to refer you (Same h a n d e d ) ? T h a n k you. This is a t e l e x Ms. P o w e r o f t h e 1 9 t h M a r c h 1986. 28 It is f r o m G u i n n e s s & M a h o n London, w h i c h is t h e 29 p a r e n t c o m p a n y of the Dublin company. It is a t e l e x 1 Yes . 2 3 23 3 Q 4 Do y o u se e it is f r o m G u i n n e s s then a reference 5 A 6 234 Q & Mahon London and ? Yes . T h e n t h e t e x t is v a l u e a n d t h e d a t e is g i v e n : 7 "We h a v e c r e d i t e d y o u r a c c o u n t . . . " 8 9 T h a t is to s a y t h e G u i n n e s s & Mahon Dublin Account. " . . .with U S $ 9 , 000..." 10 11 12 A Yes . 13 23 5 Q And: 14 " A m o u n t b e i n g f o r c r e d i t o r d e r of Guinness Mahon Cayman Trust." 15 16 This 17 a c c o u n t i n L o n d o n h a s b e e n c r e d i t e d w i t h $ 9 , 0 0 0 in 18 US d o l l a r s t o y o u r a c c o u n t in L o n d o n . 19 correct? 20 A 21 236 Q 22 A 23 237 Q 24 A 25 238 Q 26 A s e e m s to b e a t e l e x t e l l i n g D u b l i n t h a t its I h a v e no a c c o u n t Can you Is t h a t n o t in London. ...(INTERJECTION)? I h a v e no idea I a m afraid. Can you explain this? No. Was any m o n e y t r a n s f e r r e d on your .. . (INTERJECTION)? It m a y w e l l h a v e b e e n t r a n s f e r r e d f r o m J u m e l o l . 27 I s a i d I j u s t l e f t it t o t h e m a n d I h a v e n o i d e a 28 w h a t m e t h o d t h e y u s e d to t r a n s f e r it. 29 it w e n t t h r o u g h t h i s a c c o u n t . I didn't As know 1 2 3 9 Q. 2 A. 3 24 0 Q. However, No, d id you have an ac c o u n t in L o ndon? not to m y knowledge. T h i s w a s in 1986, I n e v e r o p e n e d one. is t h e r e a n y w a y i n w h i c h y o u c a n 4 recall any reason why there should not have been a 5 p a y m e n t of US d o l l a r s in 1 9 8 6 ? 6 A. 7 24 1 Q. 8 A. 9 242 Q. A. You cannot remember anything? No. Y o u c a n n o t r e c o l l e c t a n y t h i n g w h i c h w o u l d a s s i s t us I a m a f r a i d not, I a m t o t a l l y -- t h a t m e a n s t h a t t h e y s a y I h a v e a n a c c o u n t in L o n d o n ? 12 13 not especially. in u n d e r s t a n d i n g what this t e l e x m e a n t ? 10 11 No, 24 3 Q. That means that the Guinness & M a h o n Trust, sorry 14 that Guinness 15 L o n d o n b u t t h a t y o u w e r e e n t i t l e d t o s h a r e in t h i s 16 account. 17 m i s r e a d i n g it. 18 D u b l i n b u t it w a s 19 r eason... (INTERJECTION)? 20 A. 21 244 Q. 22 A. 23 24 5 Q. & M a h o n i n D u b l i n h a d a n a c c o u n t in I a m s or r y . It s e e m s t o be, I am It s e e m s t o b e f o r y o u r a c c o u n t in sent to London. Y o u h a v e no I d o n ' t k n o w why. You cannot explain why that was done? No. D i d y o u h a v e c o n t a c t f r o m t i m e to t i m e w i t h 24 Mr. 25 i n t o t h e b a n k at a l l t o d i s c u s s it? K e a n e a b o u t this, 26 A. Rarely. 27 2 4 6 Q. Rarely? 28 A. 29 247 Q. about your account, d i d y o u go Yes. Y ou t h i n k you got some s t a t e m e n t s from Dublin and 1 2 A. 3 I definitely had statements f r o m them. I may or m a y n o t h a v e k e p t t h e m all. 4 248 Q. 5 A. 6 Yes, But w h a t you h a v e you are g o i n g to give us? Yes, MR. certainly. JUSTICE COSTELLO: 7 V e r y w el l , Ms. Power that is a l l I w a n t e d t o a s k 8 you. Mr. 9 questions ? R o w a n w o u l d y o u l i k e to a s k s o m e 10 11 E N D O F E X A M I N A T I O N O F MS. 12 COSTELLO 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 P O W E R B Y MR. JUSTICE 1 2 3 MR. ROWAN: Ms. 4 you said that when you were dealing with 5 Mr. 6 the question, 7 I t h i n k y o u said, 8 A 9 25 0 Q K e a n e at t h e s t a r t o f a l l o f thi s, i n a n s w e r to did you have a solicitor advising you no? Yes . D i d y o u h a v e a n a c c o u n t a n t a d v i s i n g you, you said no ? 10 11 A 12 25 1 Q 13 14 P owe r, Yes . Just to be clear the only advice you too k was Mr. A K e a n e in G u i n n e s s from & Mahon? I h a v e a b r o t h e r in the b u s i n e s s , i f y o u like, in 15 N e w Y o rk . 16 the only accountant 17 p a r e n t ' s a c c o u n t a n t s w h i c h at t h a t s t a g e w e r e 18 C r a i g G a r d n e r b u t t h e y w o u l d n ' t h a v e a d v i s e d m e on 19 th i s. 20 252 Q 21 A 22 25 3 Q 23 A 24 254 Q 25 A 27 25 5 Q 28 A 29 256 Q I think, I had would have been my yes, to y o u r q uestion. You did not take advice from a solicitor? No. A n d you did not take advice from an accoun t a n t ? Yes, it w o u l d h a v e bee n , yes. But e s s entially the advice you took was from Mr. 26 Yes, He w o u l d h a v e a d v i s e d me on sha r e s but Keane? Yes . Mr. K eane was a c t i n g for Gu in n e s s Yes . & Mahon? 1 2 257 Q 3 The trus t e e s Guinness 4 A 5 258 Q in t h e d e e d o f s e t t l e m e n t w e r e a l s o & Mahon (Cayman T r ust)? Yes . I s uppose that d id offer a p r o s p e c t p er h a p s of a 6 c o n f l i c t of i n t e r e s t i n s o m e w a y s i n t h a t t h e y 7 w e r e . . . (INTERJECTION)? 8 A 9 w h o e v e r it w a s said, well 259 Q I have to t rust t h e m but w e l l t h a t is t h e i r b u s i n e s s t h a t is i n C a y m a n I s l a n d s , 10 11 I do r e m e m b e r saying, t h a t is w h y t h e y e x i s t . It is a l i t t l e b i t of a s u r p r i s e t h a t y o u d i d n o t 12 t h i n k o f e v e n g e t t i n g a l i t t l e b i t of i m p a r t i a l 13 a dvice from say a so l i c i t o r for ins t a n c e ? 14 A I h a d a d v i c e in A m e r i c a b e f o r e it w e n t o u t t h e r e . 15 My mother's 16 p e r f e c t l y a l l ri g h t . 17 26 0 Q 18 A l a w y e r s ou t t h e r e , t h e y s a i d it w a s Who were they? It is in o n e o f t h o s e p a p e r s . Basically Silverfelt, 19 D a n z i g e r a n d B a n g z e r or, 20 somewhere. 21 F r a n k C l i n e w a s t h e m a n at t h e t im e . 22 Mr. 23 m o t h e r ' s who h a d b e e n her lawyer for years and the 24 company whose name changed the various partners but 25 I t h i n k t h e r e is a r e f e r e n c e to t h e m i n o n e o f t h o s e 26 letters. 27 D o I t a k e it t h a t y o u d i d n o t a c t u a l l y s a y to them, 28 h e r e is t h e p r o p o s i t i o n w h i c h Mr. 29 to m e ? y o u h a v e it t h e r e T h e y w e r e d i s t r i b u t i n g t h e tr u s t , There was a D a n z i g e r in it w h o w a s a n o l d f r i e n d o f m y K e a n e is p u t t i n g 1 2 262 Q. 3 A. 4 Do y o u a g r e e t h a t t h a t is a p p r o p r i a t e ? I w o u l d n o t h a v e m e t Mr. Keane until after the stuff had gone into the Cayman Islands. 5 26 3 Q. 6 A. 7 264 Q. 8 A. 9 26 5 Q. I see? I d i d n ' t m e e t h i m u n t i l t he n . Do y o u s t i l l h a v e s o m e t h i n g in t h e C a y m a n ? Yes, t h e r e is a v e r y s m a l l a m o u n t s t i l l t h e r e . W h e n d i d y o u l a r g e l y r e d u c e it f r o m the, 10 s a i d $ 1 7 5 , 0 0 0 t h a t w e n t in, 11 d i d it r e d u c e to s o m e t h i n g m u c h s m a l l e r ? 12 A. 13 2 6 6 Q. 15 A. 16 267 Q. 17 A. 18 268 Q. 19 A. 20 2 6 9 Q. O v e r a p e r i o d o f tim e, Y o u r funds to h e l p yo u o p e r a t e y o u r b u s i n e s s ? Y e s a n d t o l i v e on. A n d to live on? Yes. M o r e r e c e n t l y I t h i n k y o u s a i d y o u h a v e an 22 your farm accounts 24 27 0 Q. n o m a j o r t im e . I h a v e b e e n u s i n g it. accountant, A. when You have been u s i n g ...(I N T E R J E C T I O N ) ? 21 23 in t h e f i r s t p l a c e , If y o u l i v e o n a f a r m it r e d u c e s v e r y q u i c k l y I c a n t e l l you. 14 I think you I p r e s u m e it is s o m e t h i n g t o d o w i t h or s o m e t h i n g of t h a t s o r t ? Yes. H a v e y o u r a i s e d t h i s i s s u e w i t h t h e m at a n y s t a g e ? 25 H a s it c o m e u p i n a n y a d v i c e t h a t t h e y h a v e o f f e r e d 26 you? 27 A. 28 27 1 Q. 29 Recently, yes, in t h e l a s t c o u p l e of y e a r s . What did they advise? 1 p a y i n g tax or something. 2 t h a t t h e t a x e s w e r e p a i d a n d t h a t w a s it. 3 a f r a i d I p l e a d v e r y g u i l t y to i g n o r a n c e o n a l l o f 4 t h i s b u t w e a r e g o i n g t h r o u g h it n o w t o t r y a n d s o r t 5 it o u t . 6 272 Q. 7 8 9 10 When did you become resident Ireland, A. As Ms. MR. I understood for tax p u r p o s e s 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 in which looking back I think 1980. ROWAN: T h a n k you. 11 12 I am Power? W h e n I s t a r t e d S u m a Stud, it w a s a b o u t I say, E N D O F E X A M I N A T I O N O F MS. P O W E R B Y MR. ROWAN 1 2 3 MS. MACKEY: Ms. 4 Pow er , I am still not very clear about how your 5 t r u s t funds i n i t i a l l y came to the C a y m a n Islands, 6 c a m e to G u i n n e s s 7 that you did not come into contact w ith 8 Guinness 9 up ? 10 A 11 274 Q (Cayman T r u s t ) . You say & M a h o n h e r e u n t i l a f t e r t h e t r u s t w a s set T h a t is r i g h t . H o w w a s t h e t r u s t se t u p ? Who made the first contact and with whom? 12 13 & Mahon A It w a s set u p f r o m N e w Y o r k f r o m t h e c o m p a n y , from I 14 t h i n k it w a s M o r g a n G u a r a n t y T r u s t h a d t h e f u n d s a n d 15 it w a s s e n t f r o m t h e r e t o th e m . 16 27 5 Q 17 A 18 19 It w a s s e n t f r o m t h e r e b u t at w h o s e r e q u e s t ? It w o u l d h a v e b e e n m i n e o f f i c i a l l y , ultimately. 276 Q Y o u a s k e d t h e m to s e n d t h e f u n d s t o Guinness 20 21 A 22 277 Q 23 A England, 27 A I did. I do k n o w that this C a n y o u t e l l us w h o t h i s Yes, 279 Q I w o u l d if I f r i e n d o f m i n e in h e m u s t h av e . f r i e n d w a s Ms. he is c a l l e d S i m o n S m i t h . Birc h a m & Company. 28 from? I can't answer that I am afraid. 25 278 Q (Cayman T r ust)? W h e r e did you get that address could. 26 & Mahon I imagine 24 29 I mean Power? He is w i t h 1 2 a n s w e r that, 3 is t h a t it m u s t ha v e . 4 28 0 Q. 5 w h e t h e r it was. Leaving aside that A s y o u say, fo r t h e m o m e n t , the logic someone advised you anyway? 6 A. 7 28 1 Q. 8 A. 9 282 Q. Yes. About Guinness & Mahon (Cayman Trust)? Yes. B e f o r e y o u a s k e d M o r g a n to t r a n s f e r y o u r f u n d s 10 th e r e , 11 Guinness 12 w o u l d o p e n up an a c c o u n t or set up an a c c o u n t ? 13 A. 14 2 83 Q. 15 A. 16 284 Q. 17 A. 18 19 d i d y o u y o u r s e l f g e t in c o n t a c t w i t h & Mahon ( C a y m a n Tr u s t ) a n d as k t h e m if t h e y I m u s t h a v e done . Do yo u r e m e m b e r that? I d o n o t r e m e m b e r it, no. Y o u h a v e no c o r r e s p o n d e n c e ? No, the o n l y c o r r e s p o n d e n c e I hav e, t h a t I f ou nd , s e n t to you. 28 5 Q. Y o u c a n n o t r e m e m b e r g e t t i n g in t o u c h w i t h t h e m a n d 20 you cannot remember specifically asking 21 M o r g a n T r u s t C o m p a n y to t r a n s f e r t h e f u n d s b u t y o u 22 think that was the agreement? 23 A. I a m s u r e I m u s t h a v e d on e . 24 agreement, 25 d i d it. 26 2 8 6 Q. 27 A. 28 287 Q. 29 I it w a s n ' t I k n o w it w a s m y s o m e t h i n g t h e y i m p o s e d o n me, It w a s d o n e a n y w a y ? Yes. T h e n y o u t o l d us t h a t a f t e r t h e t r u s t w a s set up, I 1 Yes . 2 3 288 Q What l e a d yo u to come into c o n t a c t w i t h h i m or what 4 l e a d y o u t o go t o G u i n n e s s 5 Dublin? 6 A I t h i n k t h a t m y f r i e n d Mr. & M a h o n at a l l h e r e in Smith, his f r i e n d was 7 p r o b a b l y h i g h e r u p i n t h e b a n k a n d he r e f e r r e d m e in 8 the bank. 9 t o o n e of t h e j u n i o r men. 10 289 Q What I was very small I r e a l l y m e a n is h o w d i d y o u c o m e i n t o c o n t a c t 11 with Guinness 12 go i n t o G u i n n e s s 13 A 14 f r y a n d he r e f e r r e d m e A s I say, & M a h o n h e r e at a l l ? W h a t l e a d y o u to & Mahon here? this chap said that they had a branch both h e r e a n d in t h e C a y m a n I s l a n d s . 15 29 0 Q 16 A Y e s a n d Mr. Smith t h e n . ..(I N T E R J E C T I O N ) ? I m u s t h a v e k n o w n a b o u t it b e f o r e g o i n g o u t th e r e , 17 t h i n k i n g a b o u t it, 18 h a v e s e n t it t h e r e . 19 29 1 Q 20 A because otherwise they couldn't You must have known? I mus t have h a d the name of Guinness & Mahon before the trust was distributed. 21 22 292 Q 23 A 24 29 3 Q 25 Yes? Because What I m u s t h a v e don e. I am not r e a l l y c lear about n o w a nd I know you cannot really recollect 26 A 27 294 Q 28 A 29 29 5 Q it in d e t a i l ? It is a l o n g t i m e ago. If w e c o u l d t e a s e it ou t a l i t t l e b i t ? Yes . T h e t r u s t w a s se t up, 39 you cannot r e m e m b e r the 1 No. 2 3 296 Q 4 O f h o w y o u c o n t a c t e d C a y m a n I s l a n d o r M o r g a n b u t it was 5 A 6 297 Q 7 set up t h e r e an y w a y ? Yes . The c ontact was b e t w e e n N e w Y o r k and C a y m a n Islands at t h a t s t a g e ? 8 A 9 298 Q Yes . What I a m w o n d e r i n g is w h e r e t h e D u b l i n c o n t a c t c a m e 10 in ? W h a t l e a d y o u at al l to a p p r o a c h t h e D u b l i n 11 b an k , 12 transacted.. . (INTERJECTION)? 13 A your business was being Because I l i v e d here, 14 here. 15 therefore, 16 299 Q 17 because I w a n t e d the money I w a n t e d it s e n t h e r e a n d I n e e d e d , s o m e b o d y h e r e y o u know. W h y d i d y o u t h i n k it w o u l d b e p o s s i b l e t o g e t t h e m o n e y in Ireland? 18 A 19 30 0 Q 20 A 21 30 1 Q Because they were a related branch. Someone told you that? Yes . T h a t it w o u l d b e p o s s i b l e to g e t t h e m o n e y h e r e in Ireland? 22 23 A 24 302 Q 25 A Yes . Can you recollect who told you that? It w o u l d h a v e b e e n s o m e b o d y e i t h e r i n t h e b a n k o r - ­ 26 I m e a n I u n d e r s t o o d that that was w h y I h a d gone 27 there originally. 28 i n o n e b r a n c h if it, 29 branch. In o t h e r w o r d s , if t h e m o n e y w a s it c o u l d c o m e t o t h e o t h e r 1 30 3 Q. 2 A. 3 304 Q. 4 5 In a n o t h e r c o u n t r y ? Yes. Y o u t h i n k it w a s p o s s i b l y Mr. t h i s t o y o u at t h e b e g i n n i n g ? A. He c e r t a i n l y r e f e r r e d m e to G u i n n e s s 6 w a s e i t h e r h i m or it w a s 7 two. 8 Smith who explained 30 5 Q. 9 & Mahon. f rom the States, L e a v i n g t h a t a s i d e fo r t h e m o m e n t , It one of the you were telling us t h a t t h e s h a r e s t h a t y o u w e r e e n t i t l e d t o u n d e r 10 w h a t w a s t h e A m e r i c a T r u s t as o p p o s e d t o t h e C a y m a n 11 Trust? 12 A. 13 3 0 6 Q. Yes. The shar e s yo u w e r e e n t i t l e d to u n d e r the 14 A m e r i c a T r u s t w e r e t r a n s f e r r e d i n t o t h e n a m e of 15 Jumelol Limited? 16 A. 17 307 Q. 18 Yes. T h e y t o o k o v e r t h o s e shares, Overseas Nominees, 19 A. 20 308 Q. through I think is t h a t n o t c o r r e c t ? It s a y s O v e r s e a s N o m i n e e s o n t h a t l e t t e r , yes. T h e y w e r e t r a n s f e r r e d i n t o t h e n a m e of Overseas Nominees? 21 22 A. 23 3 0 9 Q. 24 Yes. A m o n g t h e c o r r e s p o n d e n c e y o u s e n t us, t h e r e is a l e t t e r f r o m y o u r t r u s t c o m p a n y in A m e r i c a ? 25 A. 26 31 0 Q. Yes. A s k i n g you and your solicitor and your brothers I 27 th i n k , 28 the trust and you w r i t e b a c k a n d you say to s e n d all 29 f u t u r e d i s t r i b u t i o n to y o u r a c c o u n t i n t h e if t h e y w i s h e d to t a k e a d i s t r i b u t i o n f r o m 1 Yes . 2 3 31 1 Q 4 5 A I t h i n k t h e y t o o k a l o n g t i m e to w i n d u p t h e t r u s t completely. 312 Q I t h i n k t h a t is w h a t it was. F r o m t i m e to t i m e d i s t r i b u t i o n s w e r e s t i l l b e i n g made were they? 8 9 A No, it w a s f i n a l l y f i n i s h e d w h e n e v e r it wa s. 10 c a n ' t a n s w e r t h a t. 11 as I r e m e m b e r . 12 31 3 Q your accountant 14 o p e n e d it, It d i d n ' t go o n t o o l o n g as fa r in the C a y m a n Is l a n d s a f t e r you is t h a t c o r r e c t ? 15 A 16 314 Q 17 A 18 31 5 Q 19 A Brenda Aherne, 20 316 Q Brenda Aherne? 21 A 22 317 Q 23 A 24 318 Q 25 I S o m e d i s t r i b u t i o n s w e r e m a d e a n d w e r e p a s s e d o v e r to 13 26 how was the Amer i c a Trust doing with the distribution? 6 7 If t h e s h a r e s w e r e n o w in t h e C a y m a n I s l a n d s , After which? A fter you opened that trust? Seemingly, yes. W h o is y o u r p r e s e n t a c c o u n t a n t ? Aherne & Company. Yes . W h e r e are they? S h e is i n M o r e h a m p t o n Roa d, Donnybrook. Is it sh e w h o is l o o k i n g t h r o u g h y o u r f i l e s at t h e moment? A 27 Yes, s h e c o u l d s e n d t h o s e u p t o y o u as s o o n as y o u like. 28 319 Q 29 A Yes, that w ould be grand? 1 D i d sh e g i v e y o u a n y a s s i s t a n c e i n p r e p a r i n g fo r 2 this today? 3 an d d i d you e n d e a v o u r a l i t t l e bit to sort out what 4 t h e s i t u a t i o n h a d b e e n a n d so o n? 5 A S h e g a v e m e s o m e help, 6 solicitor. 7 this . 8 32 1 Q 9 A 10 322 Q 11 A As I say, yes. S h e r e f e r r e d m e to a I d i d n ' t u n d e r s t a n d a l l of D id you see a s o l i c i t o r about this w h o le m a tt e r ? Yes, I h a d a c o n s u l t a t i o n w i t h Mr. Mr. Shields. Shields? Yes . MS. 12 D i d s h e go t h r o u g h t h e f i l e s w i t h y o u MACKEY: V e r y good, I do not t hink I have any further 13 14 questions. T hank you ve r y much. 15 16 E N D O F E X A M I N A T I O N O F MS. 17 EXAMINATION P O W E R B Y MS. MACKEY 18 MR. 19 JUSTICE COSTELLO: t h e n Ms. 20 21 like these documents, 22 on? 23 24 T h a t is e v e r y t h i n g A you will arrange to send the m MR. JUSTICE COSTELLO: W e w o u l d r e q u i r e y o u to c o m e in t o s i g n t h e 26 t rans c r i p t of this evidence. 27 Yes . 29 We would Yes . 25 28 Power. 1 2 MR. 3 JUSTICE COSTELLO: V e r y well. 4 5 A n d that can be arranged. A. T h a n k you v er y much. 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE E X A MINATION WAS THEN CONCLUDED T h a n k you. m. was, 2/ a Dr 0 0. ?zx/Ord WI 0 . t. i T H IS IN D E N T U R E O P S E T T L E M E N T i s ■ A .D . 19 7 \ m ade th e D E T W E E N JO H N ANDREW F U R Z E o f ............. . day of C -e o r g e T o w n , G r a n d Caym e * i B r it is h W est I n d ie s one p a rt on b u s in e s s or a ls o tru ste e s F ir s t u n d e r th e t h e r e in s h a ll jW H B R EA S th e of S e t t lo r has b e c o m in g "th e T ru st") to any th e h e re to a d d it io n s p ro p e rty c a lle d 't h e S e t t lo r " ) c a lle d e id d it io n a l or th e b e in g o r d im in is h m e n t s T r u s t Fund" to th e th e tru sts th e th e tru sts h e r e in a f t e r in and any h e re o f is th e th e sam e fu rth e r h e r e in a f t e r "th e nam e o r u n d e r t h e * co n tro l of . m oney in v e s t ­ r e p r e s e n t in g th e re to in t o tru ste e d e s c r ib e d an d s h a l l be know n a s tra n sfe rre d w h ic h . th e p ro p e rty t im e th e c a r r y in g T ru ste e " o th e r p a r t . cau sed s u b je c t and su ccesso r ( w h ic h t o g e t h e r w i t h fo r be d u ly "th e of a com pany o f^ th e Caym an I s la n d s ( h e r e in a f t e r h e re o f) S c h e d u le any la w s in c lu d e m e n ts a n d p r o p e r t y and c a lle d a n d G U IN N E S S MAHON CAYM AN T R U S T L I M I T E D in c o r p o r a t e d te rm ( h e r e in a f t e r . e x p re sse d . •• 1 NOW T H I S S E T T L E M E N T W IT N E S S E T H 1. The T ru ste e s d u r in g th e p e r io d p re se n ts and s h a ll as sta n d c o m m e n c in g o n t e r m in a t in g on th e f o llo w s : po ssessed th e d a te of of e x p ir a t io n th e T r u s t e x e c u t io n of tw e n ty and of th e se ( 20 ) y e a r s i a fte r jn o w th e d e a th of th e la s t liv in g of U is e x p i r a t i o n of se v e n ty y e a rs !• L a te s u r v iv o r M a je s t y K in g of th e G e o rg e f r o t it t h e d a te lin e a l th e d e sce n d a n ts F if t h h e re o f or on th e ( w h ic h e v e r {j i s h a l l b e th e ; A c c u m u l a t i o n e a r lie r ) P e r io d " ( s a id p e r io d and s a id h e r e in a f t e r t e r m in a t io n d a te I 1} a f t e r c a lle d b e in g "th e h e r e in - * c a lle d "th e F ix e d D a te ") UPON T R U S T as to in v e s t m e n t s ' o r p ro p e rty j th e o th e r sam e t o t h a n m oney e i t h e r r e m a in as in v e s t e d t o p e r m it a l l fo r as o r any o f lo n g as th e deem f i t or to T ru ste e s !j I; s h a l l in t h e ir a b s o lu t e d is c r e t io n s e ll c a ll !! in or co n vert p ro p e rty fro m in t o UPON T R U S T a s any such in v e s t m oney a l l th e s a le sam e t o m oney in c lu d in g c a llin g in o r any o f su ch in or t h e m oney a r i s i n g o r c o n v e r s io n o r upon an y o f th e in v e s t m e n t s as a f o r e s a id in v e s t m e n t s to h e r e in a f t e r a u t h o r is e d . 2. T H E T r u s t e e s m ay a p p ly o r i n v e s t p u rch a se fu n d s of or sh ares at in t e r e s t upon th e s e c u r it ie s o p t io n s th e T r u s t Fund s e c u r it y o f such in th e sto ck s o r o t h e r in v e s t m e n t s o r p ro p e rty w h e t h e r r e a l o r p e r s o n a l m o v a b le o r im m o v a b le o f w h a t e v e r n a tu re and w h e re v e r s it u a t e u n d iv id e d or in t e r e s t im p r o v e m e n t o f an yw h e re i n v in g th e lia b ilit y upon su ch T ru ste e s a in lik e m e n ts) or t h e ir t im e a b s o lu t e and. w h e t h e r i n v o l ­ in c o m e o r n o t o r o r v /it h o u t s e c u r i t y 'a s d is c r e t io n p o w er t o h o ld th e ia lly a s a r e s id e n c e ) s it u a t e s h a ll t h in k f it th e w it h t o v a r y s u c h in v e s t m e n t s f o r o t h e r s * ( y e t b e in g u n d e r no d u t y t o d i v e r s i f y i n v e s t ­ s h a ll have Ij b e n e f i c d w e llin g h o u s e t im e p r o d u c in g T r u s t Fund fo r u se c r e d i t w it h to » n a tu re an d w it h o r le a s e h o ld t h e p u r c h a s e m a in t e n a n c e n o t a n d w h e th e r p r o d u c in g n o n -in c o m e jjt h e M w o r ld any f r a c t io n a l o r and in c lu d in g a f r e e h o ld p e rso n al pow er fro m of t h e r e in ( in c lu d in g sam e in p ro p e rty f u ll a ll e n t it le d cash to fu n d s th e e x t e n t and u n r e s t r ic t e d re sp e cts as u n in v e s t e d th a t th e p o w ers o f and o th e r T ru ste e s in v e s t in g if. t h e y w e r e a b s o l u t e o w n e r s P R O V ID E D h o w e v e r t h a t in th e * p r o f e s s e d j j * e x e c u t io n * of th e tru sts n o t be lia b le of in v e s t m e n t s any m is t a k e or re aso n fra u d of fo r any a n d p o w ers h e r e o f th e lo s s to m ade i n o m is s io n th e T r u s t Fu n d a r is in g good f a it h m ade i n good so ug h t to o f th e f o r e g o in g th e T ru ste e s and to • a n y r e q u ir e m e n t o f d i v e r s i f i c a t i o n are p r o p e r t y m ay b e h i g h l y s u it a b le T ru ste e s in tru st o r o th e r on t r a d in g 3. s h o rt p u rch a se co n tra cts or a c t iv it ie s and tru st p a rt s e ll THE T r u s t e e s exchange o r h o ld in g s m ay m a r g in o r h y p o t h e c a t e w h o le o r i n c a lls in v e s t m e n t s to of s e c u r it ie s e v e ry s h a ll have g r a n t o p t io n s in p u rch a se s e c u r it ie s o p t io n s p u ts and carry • s e ll le a s e th e le a s e or o r exchange , I any p ro p e rty deem ed a lw a y s w h i c h m ay a t T ru st Fund ] T ru ste e s m o v a b le o r to any e it h e r ! c o n s i d e r a t i o n i or ty p e w h a tso e v e r, to w it h o u t in v e s t m e n t s o r c o m m o d it ie s i th e s p e c if ic a lly p a r t ic u la r s e ll th e pow er t o th e a t y p e w h ic h a sse ts or of lim it in g such or not of o r by p a rt p ro p e rty eve n th o u g h s p e c u la t iv e o f any h e re b y a c q u ir e by re aso n and in d iv id u a l w it h o u t are s h a ll T ru ste e s excep t w ilf u l b e m ade l i a b l e e m p o w ered t o m ake in v e s t m e n t s or by th e a n d i n d i v i d u a l w r o n g - d o i n g .o n t h e T r u s t e e s w ho a r e g e n e r a lit y or by re aso n f a it h an y o t h e r m a tte r o r t h in g o r w ilf u l T ru ste e s im m o v a b le in c lu d e t im e at any p a rt or c o n s t it u t e p u b lic and on su ch sh are of any s h a ll be su ch p ro p e rty ) t h e w h o le o r a n y p a r t o f a u c t io n o r p r iv a t e te rm s c r e d it m ay deem a d v i s a b l e ’ ( w h ic h e x p r e s s i o n and w h e th e r or s a le s e c u r it y fo r th e fo r as th e such th e o u rp o se of j r e -in v e s t n e n t d is t r ib u t io n o r d iv e r s io n an d no p u r c h a s e r on • j a n y s a l e b y t h e T r u s t e e s o r o t h e r p e r s o n d e a l i n g w it h t h e T ru ste e s s h a ll be v a lid it y o f any co n ce rn e d act o f a n y m oney p a id o f th e in q u ir e o f th e T r u s te e s o r p ro p e rty in t o o r to th e see tra n sfe rre d p r o p r ie t y to th e to o r upon or a p p lic a t io n th e o rd e r s h a ll sta n d T ru ste e s. D l'R IK G th e possessed of f o llo w in g tru sts (a ) A c c u m u la t io n P e r io d - h e T r u s t e e s th e T r u s t Fun d and th e th a t Upon o th e rs is tru st to fo r in c o m e t h e r e o f u p o n h e re to A p p o in t e d a ll ( b e in g C la s s " ) th e s a y :- • o r any to o r o th e r o f th e p e rso n s S c h e d u le j to in th e e x c lu s io n d e s c r ib e d and h e r e in a f t e r such sh ares in th e c a lle d and i n o f th e S e c o j id "th e s u c h m anner i and s u b je c t to T ru ste e s t h e ir at in a n y t im e lim it a t io n s a b s o lu t e o r -t im e s b e fo re th e a g a in s t p e r p e t u it ie s any in any such fa v o u r is ir r e v o c a b le as d is c r e t io n D a te b y an y deed w it h o u t t r a n s g r e s s in g m a y a p p o i n t a n d -s o th a t m any v a lid p o w e r o r p o w e rs o f a p p o in t m e n t o f a n y o t h e r m em b er o f t h e A p p o i n t e d e x p r e s s ly g e n e r a lit y th e a p p o in t m e n t t h e T r u s t e e s m ay c o n f e r u p o n a p p o in t e e AND i t of p r o v id e d t h e ’ f o r e g o in g ) a p p o in t on d is c r e t io n a r y i th e F ix e d r e v o c a b le r u le or and p r o v is io n s and u n c o n t r o lle d or deeds by ii ! such C la s s . { w it h o u t p r e j u d i c e th a t tru sts to th e t h e T r u s t e e s m ay and th a t, s u c h tru sts . m ay i n c l u d e as o b je c t s of th e p o w ers a s re g ard s in c o m e I* j‘ of th e T ru st F u n d a n y m em ber o f t h e A p p o in t e d •j a n d m ay d is p o s e of t h e w h o le o r a n y p a r t of C la s s th e T r u s t e x is t e n c e in at th e t im e o f s u c h d i s p o s i t i o n a c c o r d a n c e w it h n o t) th e la w s o f t h e C a y ra a n u n d e r w h ic h a n y m em ber o f a b e n e f ic ia r y to b e h e ld as Fu n d t h e r e o f an d s u b je c t to fa r as th e Upon T r u s t Fund in th e to to th e (c ) r e s u lt in g d is c r e t io n to is th e T r u s t a n f s u c h a p p o in t m e n t a n d s o in a u t h o r is e d and r e s u lt in g a n d a d d in g of th e a c c r e t io n s o f th e T r u s t Fu nd . in m a y jp a y o r a p p l y , a t a n y t i m e t im e d u r i n g th e any o f- in c o m e a s a lw a y s t h a t t h e T r u s t e e s to th e T r u s t in v e s t in g in c o m e t h e r e f r o m h e r e in b e f o r e a p art P r o v id e d th e an a c c r e t io n a c c u m u l a t e a n y in c o m e o f a c c u m u la t io n s and a s or th e A p p o in t e d C l a s s t h e w ay o f com pound i n t e r e s t b y in v e s t m e n t s such Is la n d s sam e n a y n o t e x t e n d . (b ) sa m e a n d and w h e th e r t h e A c c u m u la t io n P e r io d t h e ir a b s o lu t e an d fro m a ll or t im e any p a r t in c o m e o r c a p i t a l o f t h e T r u s t F u n d ' t o . o r b e n e f i t o f t h e m e m b e rs o f t h e A p p o i n t e d C l a s s fo r and * o f m o re t h a n of th e Upon th e D a te to fo r C la s s D a te and m ay i n as in in t h e ir t e r m in a t io n Upon T r u s t or a n y o n e o r m o re t o o th e r o r o th e rs o f th e T r u s te e s (d ) one fo r as to th e th e m a n d i n a b s o lu t e such such liv in g sh ares d e f a u lt o f sh ares as t h in k f it . on t h e F ix e d o f t h e T r u s t **und t h e b e n e f i t o f s u c h m e m b e rs o f s h a ll be e x c lu s io n d is c r e t io n o f th e T r u s t B a la n c e th e t h e A p o o in t e d im m e d ia t e ly b e f o r e t h e F ix e d as th e T ru s te e s s u c h d e t e r m in a t io n s h a ll if d e t e r m in e m o re th a n one in eq ual sh ares th e T r u s t e e s T r u s t Fund th e ~ s h a l l h o ld in B r it is h a b s o lu t e ly tru st fo r b e a good d is c h a r g e th e p a r t ie s w h ic h w it h such m ay i n IN in tru st tru st tru sts a d d it io n im p lic a t io n s h a ll have a ll a b s o lu t e d is c r e t io n e x e r c is e in such th e s a id p a rty m ay b e f o r m e d b y an d upon su c h d is c r e t io n th e T ru ste e s t im e of th e of s h a ll T r u s t Fund to th e . o r p a r t ie s th e te rm s a n d p o w ers e x e r c is a b le a ll r e c e ip t s th e T r u s t e e s . fo r th e a b s o lu t e to th e of su c h C h a r it y o f an y p e rso n o r p e rso n s t h e ir o r by th e of e n u m e r a t e d m a y b e m ad e e i t h e r or tru sts p r o v is io n s d is c r e t io n to G ra n d Caym an b r a n c h and in c o m e b e n e f i t o f a n y o n e o r m o re o f or in c lu d in g e x p r e s s ly to h e r e in b e f o r e o u t r ig h t 5. th e A n y p aym en t o r a p p lic a t io n o r fo r ' and a f o r e s a id c a p it a l t i m e beijq gr o f fo r th e as th e Red C r o s s A s s o c ia t io n th e T re a s u re r (e ) and s u b je c t as f o llo w in g a ll m anner and to th e T ru ste e s f^ t. * th e T r u s te e s la w e x te n t th e if . . or sta tu te p o w e r s a n d m ay i n o r any o f such at in h e re u n d e r o r by an d c o n d it io n s th e t h in k p o w ers v e s t e d T ru ste e s t h e ir sa m e f r o m at a ll th e t im e , a s m ay I seem t o th e m d e s i r a b l e . (a ) To o r w ill r e c e iv e or by o r o t h e r w is e t h is ‘ sam e u p o n such i! I !f •* T ru st th e fro m and as th e a d d it io n s a d d it io n a l p r o v is io n s p r o p e r ly o f any o r d o n a t io n s o th e r any p e rso n o r p e rs o n s p a rt T ru sts under o f th e T r u s t h e r e in th e set as and to h e re o f. or tru sts a d d it io n s F u n d and^ t o fo rth p r o v is io n s tru st b y g .L E t h o ld to th e a d m in is t e r * (b ) W it h re sp e c t to any p ro p e rty or p art o f w h ic h i n d i v i d u a l b e n e f i c i a l o w n e rs m ig h t e x e r c i s e of tru ste e of th e r e s t r ic t e d in c lu d in g f o r e g o in g ) ( i) in a n y w ay b y t h e ( w i t h o u t “p r e j u d i c e th e f o llo w in g T o p ro m o te an d on a n y b u s in e s s to e x e r c is e th e w h o le w it h o u t b e in g th e T r u s t Fu n d c o n s t it u t in g to th e g e n e r a lit y p o w ers. in c o r p o r a t e t h e ir p o w ers o f f ic e c o m p a n ie s w h a tso e v e r and pow er to sam e a n d d i s t r i b u t e a ll a sse ts in to carry* liq u id a t e s p e c ie th e o r 'o t h e r ­ w is e . ( ii) To v o te s e c u r it ie s upon o r in bonds n o te s o r o b lig a t io n s or c o n c e r n w h e th e r o r n o t a f f e c t in g or an y c o r p o r a t io n a p p a re n t s e c u r it y th e p u rch a se any su ch any o r o t h e r e v id e n c e in th e of re sp e ct o f c o r p o r a t io n or tru st le a s e of of tru st th e o f any p a r t o f o r s a le sh ares a s s o c ia t io n s e c u r it y th e th e a s s o c ia t io n in t e r e s t or T r u s t Fund a sse ts of o r^ c o n c e r n and , ( iii) To g iv e p r o x ie s w it h o u t pow er o f o r p o w ers o f s u b s t it u t io n a t t o r n e y w it h f o r v o t in g or or a c t in g I on b e h a lf p ro p e rty ( iv ) of th e To p a r t ic ip a t e d is s o lu t io n change in stru ctu re as th e o w n e rs of any su ch and r e o r g a n is a t io n h o ld T ru ste e s and c o n s e n t to c o n s o lid a t io n s a le any in or or in and to c o r p o r a t io n or in it s h e re u n d e r and any co rp o ra te m erg e r liq u id a t io n le a s e a f f e c t in g any s e c u r it ie s any o th e r f in a n c ia l or o th e r p ro p e rty (v ) T o becom e a p a r t y d e p o s it ag re e m e n t p ro p e rty h e ld o r w it h ( v i) fo r so any as f o r m in g o f any fo r and to u se and b e n e f it T ru ste e s' and to or to any s e c u r it ie s * T ru st o f f ic e r fo r th e r e m u n e r a t io n and th e be e n t it le d r e t a in v o t in g Fund or to v o te T ru ste e s' fo r th e s e r v ic e s . T o h o ld o r d e p o s it any in b e are r fo rm T ru ste e s or in nam e o f a n y o n e o f th e T r u s t C o r p o r a t io n or in o r p a r t n e r s h ip a p p o in t e d or s e c u r it ie s p ro p e rty p e rso n s or th e re b y any th e o r o th e r r e a s o n a b le in e x e r c is in g p a rt o f com pany an d t o b e p a id or s e c u r it ie s d e s ig n a t e d a t t a c h in g b eco m e a D i r e c t o r e m p lo y e e ( v ii) c o m m it t e e o r co n cu r in t im e b e in g to any tru st an y p r o t e c t iv e d e p o s it a r y and o th e r r ig h t s th e d e p o s it o r s im ila r To e x e r c is e v o t in g to an y v o t in g h e r e u n d e r w it h r e o r g a n is a t io n tru st and to in th e or th e nape nam e o f in th e of o th e r th e % # t h e m 'b e in g a som e o t h e r nam e o f n o m in e e w i t h o u t d i s c l o s i n g r e la t io n s h ip or th e a d u ly f id u c ia r y . and i ( v iii) T o o m it t o ( ix ) To keep r e la t in g to c o m p r is e d th e (c) To s a id s e p a r a t e ly th e Caym an in v e s t or t h e w h o le and in r e g is t e r th e or bonds o r any s e c u r it ie s p a rt of m oney in v e s t m e n t s s a id T ru st Fund w it h in o r w it h o u t , an d m anage t o g e t h e r w it h d o cu m e n ts and p ro p e rty Is la n d s . r e -in v e s t th e and o th e r th e fu n d s T ru st to Fund a c q u ir e e it h e r and r e t a in th e sh ares o r s e c u r it ie s o r in v e s t m e n t t r u s t s an d w it h o u t n o t ic e com m on t r u s t at lia b ilit y at to o r a d v is o r s h ig h ly (e ) C la s s be to p a r t ic ip a t e of o f t h e T r u s t F u n d a n d w it h o u t ” such in c lu d in g tru st in v e s t m e n t s . te rm s t h e m e m b e rs o f m ay d e t e r m i n e and t h e A p p o in t e d th e g e n e r a lit y of and and d e liv e r o p t io n s s e a le d a l l o r a n ^ * p o r t io n s deeds in s t r u m e n t s lie n s co n tra cts and o r u n s e a le d th e W it h o u t p r e j u d i c e to p e rso n s th e to T ru ste e s th e th e in t e r e s t e d or to a p p o r t io n b e tw e e n sto ck d iv id e n d s r ig h t s to to and ra ze deem p r o p e r . . r ig h t s tre a t in c o m e a n d in t e r e s t or erect t o m ake a n y k in d ju r is d ic t io n r e s p e c t iv e of conveyances m o rtg a g e s o r o th e r s tr u c tu r e s • a c c o r d in g . le a s e s c r e a t in g im p r o v e m e n t s w h i c h (g ) o f th e . % „ tra n sfe rs any b u ild in g s fro m o r t o b e r e a s o n a b le m o rtg a g e o r h y p o th e c a te in s t r u m e n t s a d v is o r r e c o m m e n d a t io n s m a y b e le n d m oney o n s u c h p le d g e in s t r u m e n t s o th e r tru ste e o f a n in v e s t m e n t a d v is o r le g a l o r s u it a b le T o m ake e x e c u t e a s s ig n m e n t s any . o f th e . T r u s t F u n d . (f) ty p e o r n o t o f a t y p e w h ic h w o u ld th e T ru s te e s to in any c o rp o ra te a n d p r o p e r a n d w it h o u t l i m i t i n g f o r e g o in g open o r c lo s e d t h e r e c o m m e n d a t io n s o f s u c h e v e n th o u g h p e rso n s as s e r v ic e s f o llo w T o b o rro w o r such anyone th e exp ense s p e c u la t iv e o r d in a r ily to to To engage th e o r a d v is o r s w h e th e r o f th e fu n d m a in t a in e d b y . . s e r v in g h e re u n d e r. a n y t im e (d ) o f i n v e s t m e n t c o m p a n ie s as of C o u rt and in t e r e s t s in c o m e o r c a p it a l any re n t th e is s u e d c a p it a l d iv id e n d s and p r o f it s d e r iv e d T ru st fro m Fund r e c e ip t s any p ro p e rty an d g e n e r a lly of th e and w h e th e r o r t iv e T ru st is n o t w it h s t a n d in g e a rn e d of th e r ig h t s accru e d in c o m e o r th e t o d e t e r m in e w h a t p a r t o f th e t im e w hen s u c h c a p it a l as pay in c o m e o r in c lu d in g to w a s t in g o r p a id to o r p r o f it s th e T r u s te e s o f th e fro m c a p i t a l o r t o and o f s e llin g ch arg e d to d e t e r m in e or sh ares as th e to To carry T ru st b e tw e e n of to b e tw e e n le a s in g and ch a rg e s se p a ra te a llo c a t io n out o f m a k in g o r c h a n g in g and g e n e r a lly th e * c a p it a l and w hat p a r t t o fu n d s in c o m e and d is t r ib u t io n s . (h ) re se rv e s a p p o r t io n e x c h a n g in g o r c o m m is s io n s w e re * deem p r o p e i? f o r d e t e r m i n e w h a t p a r t o f t h e e x p e n s e s to f s h a ll be u n p ro d u c­ sto ck m ake s u c h and o th e r l i a b i l i t i e s b ro k e rs' or d iv id e n d s re n t is s u e s in c o m e a n d c a p i t a l a n y e x p e n s e s in v e s t m e n t s is c a p it a l a t a p r e m iu m o r d i s c o u n t a n d d e c la r e d ta x e s c o m p r is e d in c o m e a n d w h a t i s in t e r e s t exp enses fro m in n o t such p ro p e rty o r w as p u rc h a se d d iv id e n d s a t a n y t im e T ru st . in c o m e a n d and se p a ra te g a in s p r o f it s p a rts lo s s e s ' on p a r t ic ip a t e o r in v e s t in any c o r p o r a t io n I p a r t n e r s h ip in t o to such th e s h a ll jo in t le a s e s or co n tra cts c o -o p e r a t iv e o r o th e r T r u s t Fund o r any p a rt o f in t h e ir n o t w it h s t a n d in g t a k in g s t h is v e n tu re e x te n d T ru st. u n c o n t r o lle d th a t such it u n d e r t a k in g s as d is c r e t io n le a s e s and to r e la t in g th e T ru s te e s deem a d v a n t a g e o u s co n tra cts o r m ay e x t e n d b e y o n d t h e e n te r o r u n d e r­ t e r m in a t io n of ( i) To in s t it u t e a c t io n s p r o s e c u te an d d e fe n d an y s u i t s o r o t h e r p r o c e e d in g s a f f e c t in g th e T ru s te e s o r th e T r u s t Fund o r any p a r t th e re o f to any m a tte rs to in r e la t io n s h a l l seem s u f f i c i e n t a n d i n a u c t io n o r p r iv a t e and f o r such te rm s a s m ake p a r t i t i o n w it h th e T r u s t h a v in g th a t to th e T r u s te e s * w h o le o r i n o r o t h e r w is e p a r t a t p u b lic and upon s u c h t h e T r u s t e e s d eem a d v i s a b l e th e an y p r o p e r t ie s a r e in t e r e s t e d o r by s e t -o f f f o r e q u a lit y o f e x ch a n g e ). ( j) th e o p in io n o r a d v ic e p r o v is io n ' under t h is m a tte r in a n y w ay r e l a t i n g T ru ste e s' d u t ie s ’ in in o r b y a g re e m e n t * a r is in g to a n d t o m ak e s u c h ( i n c l u d i n g w h e re deem ed d e s i r a b l e an y d if f e r e n c e te rm s c o -o w n e r s o r j o i n t o w n e rs b e s i d e s e it h e r by s a le ta k e a d ju s t * o r o t h e r w is e To o w in g a g a in s t any in t e r e s t in th e T ru s te e s p a r t it io n s a le and to t o d e b ts o r c la im s th e m a s T r u s t e e s u p o n e v i d e n c e w h ic h c o m p r o m is e o f d i f f e r e n c e o r co m p o u n d a n y d e b t s th e m a s T r u s t e e s o r a n y o t t e r c l a i m s an y d is p u t e s or to o f c o u n s e l c o n c e r n in g S e t t le m e n t o r a n y th e T r u s t Fund o r to c o n n e c t io n w it h th e th e T r u s t Fund and I in a ll o f such (k ) any su ch m a tte rs to a c t in a c c o r d a n c e w it h th e o p in io n c o u n s e l. T o e m p lo y a n d p a y a t ag e n t in s o lic it o r any p a r t o f th e exp en se o f th e T r u s t Fund t h e w o r ld w h e th e r a n a t t o r n e y b a n k e r a cco u n ta n t sto ck b ro k e r o r o th e r ag e n t a n d w h e th e r o r n o t b e in g one o f th e T r u s t e e s to o r do an y a c t r e q u ir e d tra n sa ct tra n sa c te d a n y b u s in e s s o r done in th e e x e c u t io n of th e h e re u n d e r to tru sts be h e re o f in c lu d in g t h e r e c e i p t o r p a y m e n t o f m o n ey a n d t h e e x e c u t io n o f d o c u m e n t s a n d no f i r m c o r p o r a t io n w it h in a n y o f w hose s e c u r i t i e s are or in c lu d e d th e T r u s t Fund and no p u rc h a s e r o r o th e r p e rso n . d e a lin g w it h d e le g a t io n ■ . a n y a g e n t p u r p o r t in g o r a u t h o r it y to in s u c h d e le g a t io n w h ic h d e le g a t e d a s c e r t a in a u t h o r it y th e T r u s te e s s h a ll be o r in q u ir e w h e th e r a c a s e is e x is t s p e r m it t e d o r w h e t h e r s u c h s t ill s u b s is t in g P R O V ID E D h o w e v e r s h a l l n o t be r e s p o n s ib le d e f a u l t n e g lig e n c e o r fo r any is to a c t under fro m t h e T r u s t e e s r e q u ir e d th a t a s s o c ia t io n f o r th e o r f r a u d o f a n y a g e n t s o e m p lo y e d lo s s o c c a s io n e d t h e r e b y a lt h o u g h th e e m p lo y m e n t o f s u c h a g e n t w a s n o t s t r i c t l y n ece ssary o r e x p e d ie n t . * (1) Upon an d f o r t h e p u rp o s e o f an y d i s t r i b u t i o n or * a p p r o p r ia t io n o f th e T r u s t Fund o r an y p a r t t h e r e o f in t h e ir u n fe tte r e d d is c r e t io n and a l l a sse ts v a lu a t io n t h e ir a b s o lu t e good f a it h and c o n c lu s iv e t o whom d is t r ib u t e am o u n ts and u n c o n t r o lle d I m ade i n s h a l l be a b s o lu t e ly on a l l B e n e f ic ia r ie s f u r t h e r upon an y su c h d is c r e t io n d e t e r m in e to th e m i n s h a l l se e m j u s t a n d p r o p e r a n d a n y s u c h an d b in d in g and su c h v a lu e on any f r o m t im e t o t im e f o r m in g p a r t o f t h e T r u s t Fund as to d is c r e t io n to p la c e th e s p e c if ie d a sse ts sam e s u b j e c t t o a s m ay b e n e c c s s a r y f in a l h sre u n d e z o r a p p r o p r ia t io n s h a l l be g iv e n to and th e paym ent o f su ch to a d ju s t th e sh ares o f th e •* * / l 3 of • t h e T r u s t F u n d m ay b e e i t h e r m ad e d i r e c t l y B e n e f ic ia r y o r d u r in g g u a r d ia n 6. h is th e u se o f s a id fo r it s e x p e n d it u r e . T ru s t Funds s h a ll in c lu d e in any o f. a n y o f it s lia b ilit y o r d u ty s a id to th e g e n e r a lit y to liv e s o r r e s id e s o f C la u s e any sh a re s c o n t r o l th e s u b s id ia r ie s a p p o in t e d w it h o u t r e s p o n s i b i l i t y , o w n e r s h i p o f w h ic h g i v e s c ir c u m s t a n c e s d u ly ' to a com pany t h e h is B e n e f ic ia r y W ITH O U T p r e j u d i c e in any b e n e f it b y th e T r u s te e s a n y p e r s o n w i t h whom h e fo r th e th e fo r h is m i n o r i t y m ad e ^ o r to if of o r a p p lie d to to a f f a ir s th e T ru s te e s o r o th e r in t e r e s t s th e m t h e r ig h t o f t h e Com pany o r s h a l l b e u n d e r no a p p o in t a n y r e p r e s e n t a t iv e Com pany o r o f an y o f i t s 5 -h e r e o f to s u b s id ia r ie s th e B o ard and fu r th e r ‘ .I s h a l l h a ve no r e s p o n s ib ilit y p a rt in t h e m anagem ent o r a f f a i r s o r any o f it s 7. th e i. t o e n q u ir e IN • o v e r S e e .o r t a k e o r b u s in e s s o f th e Com pany s u b s id ia r ie s . a d d it io n T ru ste e s in t o to r e im b u r s e m e n t o f t h e i r p r o p e r e x p e n s e s s •h a l l b e e ^n t i t l e d p ro b a te s u c c e s s io n p a y a b le and a s e sta te a f ir s t ii j, s e r v i c e s a s T r u s t e e s ii ;i o f f e e s i n e f f e c t a t in to r e m u n e r a t io n (fre e of any o r o th e r d e a th d u t ie s w h e re so e v e r c h a rg e on th e T r u s t Fu n d ) fo r • a c c o r d a n c e w it h th e d a te t h e ir o f a p p o in t m e n t t h e ir p u b lis h e d s u b je c t to s c a le any ! . ;! a m e n d m e n t t h e r e o f w h i c h m ay b e a g r e e d u p o n f r o m il j t im e to t im e * in w r it in g b e tw e e n th e T ru ste e s and th e p e rso n o r p e rso n s fo r :j t h e t iiu o b e in g h a v in g p o w e r t o a p p o i n t new T r u s t e e s h e re o f I, P R O V ID E D I how ever t h a t th e o.f o r w i t h th e T ru st " W h ic h b y t h e i r upon th e g e n e r a lit y of th e th e p a r t ic u la r f o r e g o in g ! a c c o u n t o r d e p o s it w it h are th e a u t h o r is e d t im e b e i n g T ru ste e s T r u s t a n d m ay r e t a i n any p r o f it by sto ck b ro k e rs . o t h e r w is e f ir m h o ld in g th e to f in a n c ia lly sh ares o r b e in g o t h e r w is e th e T ru ste e s as acco u n t to o f f ic e th e h o ld e r s . T ru st T ru ste e s an y b e n e f ic ia r y in w h ic h th e o r p a rtn e rs or any p e rso n o r f in a n c ia lly in t e r e s t e d h o ld e r s s h a r e h o ld e r s o f s u c h b u s in e s s sh ares or th e T r u s t Fund fo r th e su ch o f f ic e a n y c o r p o r a t io n to to acco un t fo r in p a rt of c o n n e c t io n account h o ld o r fo rm in m oneys to a r e s u lt lia b le . in s u r a n c e 6t T ru st o r w it h th e on c u r r e n t a ll th a t o r p a r t n e r s h ip in t e r e s t e d as o f f ic e lia b le o r s h a r e h o ld e r s or p a rtn e rs c o m p r is e i h o ld e r s T ru s te e s * w it h o u t b e in g a c c r u in g c o r p o r a t io n o f f ic e are in any on b e h a lf o f th e to a n y c o m m is s io n t h e r e b y m a d e P R O V ID E D f u r t h e r h e r e u n d e r w it h are m ay r e t a i n f o r t h e m s e lv e s o r a llo w e d m ay t r a n s a c t b u s in e s s T ru ste e s fo r any p r o f it o r advanced c o m p a n ie s o r o t h e r a g e n t s w i t h o u t b e i n g fo r u n d e rta k e b e m ade w it h advance a t in t e r e s t o r c o n v e n ie n t t o b e r e t a in e d o r. r e m u n e r a t io n p a i d to a n d w it h o u t p r e j u d i c e th e account or on b e h a lf h e r e u n d e r a n y b u s in e s s c u s t o m e r a n d w it h o u t a c c o u n t in g t h e r e b y m ad e a n d i n n e ce ssary th e y a s w o u ld f o r j « m ay t r a n s a c t o r an y B e n e f ic ia r y c o /is t it u t io n sam e t e r m an o r d in a r y T ru ste e s and any p r o f it t h e T r u s t e e s m ay s e c u r i t i e s w h ic h and s h a ll e m o lu m e n t s r e c e i v e d n o t be lia b le b / th e m a s such . 8. (a ) m ay a t a n y t im e THE T r u s te e s h e re o f or (w h e th e r o r i g i n a l o r t i m e s b e re m o v e d f r o m t h e ir T r u s te e s b y a d eed e x e cu te d by th e S e t t lo r " th e A p p o in t o r " ) and d e liv e r e d s u b s t it u t e d ) o f f ic e of ( h e r e in a f t e r to th e T r u s te e s c a lle d and th e A p p o i n t o r m ay b y d e e d e x e c u t e d a n d d e l i v e r e d a s a f o r e s a i d a p p o i n t ' ' • -“I. .. a n y o t h e r p e r s o n o r p e r s o n s w h e th e r o r n o t r e s id e n t i n th e Caym an I s l a n d s to b e T r u s te e s th e n c o n t in u in g T r u s t e e s n o t be a n y c o n t in u in g o r s o le ly jo in t ly in T ru ste e s of th e o u t g o in g tru ste e th e d e a th o f u n le s s a fte r any o th e r re m o val th e re s h a ll o r e x p e d ie n t t h e p e r s o n s who s h a l l t h e r e u p o n b e c o m e t h e T r u s t s h e r e b y c r e a t e d P R O V ID E D h o w e v e r t h a t a n w ho i s lia b le as a tru s te e a n y p e r s o n b e co m e l i a b l e n o t be bound to r e a s o n a b le o u t g o in g if w it h a s m ay b e n e c e s s a r y f o r a n y in c o m e p r o b a t e e s t a t e s h •a l l jo in t ly T r u s te e s and th e re u p o n th e T r u s t Fund s h a ll be by any assu ran ce v e ste d e it h e r tru ste e a fo rm e r t r u s t e e h e re o f o r o th e r d u t ie s fe e s o r ta x e s M • t r a n s f e r t h e T r u s t F u n d a s ' a f o r e•% s a id s e c u r it y is a g a in s t su ch re m o val o f t r u s t e e s as h e r e o f o r m ay o n p r o v id e d fo r lia b ilit y in d e m n if y in g such P R O V ID E D A L S O t h a t n o b y t h e A p p o in t o r s h a l l b e e f f e c t i v e u n le s s a fte r su c h re m o val ( e i t h e r w i t h o r w i t h o u t a new a p p o in t m e n t ) th e re s h a l l r e m a in at o r tw o t r u s t e e s b e in g (b ) c la u s e (a ) le a s t one t r u s t e e t h is o r s u b s t it u t e d o r s h a l l d e s ir e a t r u s t c o r p o r a t io n in d iv id u a ls . W it h o u t p r e j u d i c e of b e in g C la u s e i f s h a l l d ie t o th e p o w ers c o n t a in e d in a T r u s t e e h e r e o f w h e th e r o r i g i n a l o r b e in g t o b e d is c h a r g e d o r p o w ers h e r e o f o r s h a l l r e fu s e a c o r p o r a t io n fro m a l l be d is s o lv e d o r any o f th e o r beco m e u n f i t to act tru sts t h e r e in sub­ • • ■ I 1 - o r b eco m e in c a p a b l e of 16 a c t in g - t h e r e in th e n th e f o llo w in g l p e r s o n s n a m e ly : t ( i) !i ii th e A p p o in t o r o r i f o r u n w illin g to a c t • . / ( ii) th e s u r v iv in g o r }\ he s h a ll be d ead o r u n a b le i j . • . c o n t in l$ L n g T r u s t e e s h e r e o f !! fo r th e . ' t im e b e in g or if th e re be no s u r v iv in g T ru ste e s # ■ ( iii) or 1 c o n t in u in g # . th e i I ; i p e r s o n a l r e p r e s e n t a t iv e s of th e la s t s u r v iv in g '* ‘ : - T ru ste e .. such *• I; if la s t such la s t T ru ste e T ru ste e w as a n in d iv id u a l w as a c o r p o r a t io n th e n such but if la s t • : • T ru ste e u p o n r e t i r e m e n t m ay b y d e e d a p p o i n t o n e o r m o r e :• t - * !• o th e r p e rso n s or c o r p o r a t io n (w h e th e r o r n o t b e in g or il i I !; in c lu d in g th e p e rso n s i: e x e r c is in g • (; T ru ste e th e p o w er) to be a j ' o r T ru ste e s in } th e p la c e of th e T ru ste e so . r e f u s in g ! »t 1 >• j / d eceased d is s o lv e d o r b e in g u n f it d e s ir in g to b e d is c h a r g e d Ij ! i (c ) t a in e d o r b e in g T h e p o w ers m ay a t any t im e in in c a p a b le s u b -c la u s e be. i r r e v o c a b l y s* . ; e x e cu te d by th e lik e ' th e s a id p o w ers im m e d ia t e ly or to a fte r p e rso n th e a f o r e s a id . of r e le a s e d th e C la u s e by con- J a deed ! to th e or o r p e rso n s to d e a th o r T H IS ; l . m anner r e v o c a b ly I any as (a ) A p p o in t o r a n d d e liv e r e d ;; t h e A p p o i n t o r m a y i n t ; T ru ste e s and * ir r e v o c a b ly tak e A p p o in t o r g ran t e ffe ct as th e case m ay b e . , (d ) or by The T ru ste e s s u b s t it u t e d ) a fte r 1 m ay i f th e y h e re o f o r any o f so d e s ir e 30 d a y s x /r it t e n n o t ic e r e g is t e r e d p r e p a id p o st to o f t h e ir th e r e s ig n as in t e n t io n A p p o in t o r o r th e m T ru ste e s so such to (w h e th e r o r i g i n a l h e re u n d e r do s e n t p e rso n as th e A p p o in t o r m ay fro m r e s ig n a t io n s h a ll such of n o t ic e . (e ) In h e re o f o r in t im e th e event of case th e re Upon th e h e r e in b e f o r e th e in in upon th e r e s ig n a t io n s h a ll be no w r it in g . day s u b s t it u t e d p r o v id e d th e th e c o n n e c t io n or Such s p e c if ie d , in T ru ste e s h e r e u n d e r G U IN N E S S C h a n n e l Is la n d s T ru ste e s s h a ll be T r u s t Fund th e th e fo r a ll o r t h e ir h e re u n d e r. re m o v a l o f T ru ste e * * w it h of tru ste e of Je rse y, r e s ig n a t io n r e im b u r s e m e n t o u t o f b y th e m a p p o in t r e s ig n a t io n . s h a l i becom e (f) t im e becom e e f f e c t i v e MAHON J E R S E Y T R U S T L I M I T E D su ccesso rs to th e T ru ste e s as e n t it le d to exp enses in c u r r e d s e t t le m e n t o f th e r e c e iv e account of th e T ru ste e s. (g ) be . On e v e r y en d o rse d th e by p u b lic th e T ru ste e s p e rso n s so and p e rso n any upon any such m o re th a n one) as s u f f ic ie n t are of S e t t le m e n t . (h ) a ll th e t h e ‘f u l l y p re se n ts and j o r ie s c u s t o d ia n s !' accept •I jj ^ . ii !! • and in s t r u c t io n s . d is p o s it io n s th e t im e w it h (o r a ll of th e to t h is b e in g s a id s h a l l b e s ig n e d •i a n o ta ry o r n o t a r ie s T ru st s h a ll la t e s t of be e n t it le d such p e rso n s T ru ste e s fo r th e of t h is Fund la w n o m in e e s s h a ll be s u b s t it u t e d or nam ed ’ t im e S e t t le m e n t by to m e m o ra n d a i f th e banks b ro k e rs th e S e t t le m e n t s t a t in g and by th e T r u s t e e s T ru st a m e m o ra n d u m s h a l l th a t T ru ste e s upon th e fro m th e e v id e n c e I co n fe rre d any t r u s t e e s h ip a f f ix e d c o n s t it u t e d A ny s u b s t it u t e d p o w ers or d e a lin g m e m o ra n d u m t h e r e in t h is fo r th e nam ed a n d a u t h e n t ic a t e d r e ly • in o n o r p e r m a n e n t ly nam es o f th e change and b e in g s h a ll have th e se o th e r d e p o s it - a u t llo r is e d T ru ste e s as th e re o f. ' .../is to to th e j 9. THE T ru s te e s t j d o c u m e n t s o f a n d m ay a t in c lu d e t it le th e cu sto d y th e f o r th e sa fe s a f e k e e p in g s e c u r it ie s d e p o s it th e o f a n y b a n k b a n k in g co m p an y c o r p o r a t e in any p a rt o f s h a ll n o t be as in th e w o r ld p a rt of it s a n y w is e r e s p o n s ib le o r sto ck b ro k e r or fo r th e or sto ck ­ sa fe cu sto d y th e T ru s te e s th e m is a p p lic a t io n s a m e o r a n y o f th e m b y s u c h b a n k b a n k i n g tru ste e th e b u t so th a t fo r and th e sam e i n tru ste e th a t u n d e rta k e s b u s in e s s S e t t le m e n t ( w h ic h e x p e n s e m ay cu sto d y o f o f in c o m e ! of a ll s u b je c t o f t h i s exp ense o f th e T r u s t Fund an d r e m it t a n c e o f s e c u r it ie s th e fo r th e and s e c u r it ie s any ch arg es c o lle c t io n b ro ker s h a l l p r o v id e of com pany c o r p o r a t e a n y l o s s w h ic h m ay b e o c c a s i o n e d th e re b y . 10 . n ? th e fe e s e v e n t o f a n y in c o m e p r o b a t e e s t a t e o r t a x e s b e c o m in g p a y a b l e w h ere in d e a th o f re sp e ct of any p a r t o f th e such w it h o u t r e c o u r s e re fu se to and to d e t e r m in e T r u s t e e s m ay a t t h e i r d i s c r e t i o n -p a y a l l d u t ie s a g a in s t p ay th e fe e s and t a x e s a n y m em b er o f th e I to no s u r e t y th e t h e A p p o in t e d C l a s s th e T r u s tu e s or if h e r e in r e q u ir e d on su c h any. nam ed a b o n d s h o u ld b e e x t e n t t h a t a w a iv e r b y t h e A p p o in t o r s h a ll be a bond. . or in d e m n if ie d t im e a n d m a n n e r o f s u c h p a y m e n t i f of or o u t o f th e T r u s t Fund sam e o r a n y p a r t t h e r e o f u n l e s s NO b o n d s h a l l b e r e q u i r e d la w o r e ls e ­ t h e T r u s t F u n d o r a n y p a rts t h e r e o f o n t h e (w h e th e r o r i g i n a l o r s u b s t it u t e d ) by th e Caym an I s la n d s t h e A p p o i n t o r o r o f a n y m em ber o f t h e A p p o i n t e d C l a s s o r o t h e r w is e 11. in o r o th e r d u t ie s is r e q u ir e d e f f e c t iv e 12 . T H IS e x p r e s s ly T ru st w a iv e s c o n ju n c t io n t h is th e m e n t e r in g th e 14 . of in t o in in and th e and pow er w h e th e r p e rso n w h o le o r in to a lt e r p a rt o r as th e a d m in is t r a t io n co n tra cts w it h o f th e t J ie T r u s t e e s A p p o in t o r a lo n e or to any o f i t s lia b le T r u s t and p e rso n s s h a ll lo o k T ru ste e s to h e re b y d e c la r e d th a t (1) to re fu se of th e r ig h t (o r any T ru ste e s s h o u ld of th e T ru ste e s th e f o llo w in g th e T ru ste e s) e x e r c is e under th e d is c lo s u r e of g e n e ral la w an y docum ent i t is n o t be bound to d is c lo s e is to say any d e lib e r a t io n s of th e s h a ll d o cu m e n ts A ny docum ent d is c lo s in g T ru ste e s s o le ly ‘ W IT H O U T p r e j u d i c e any te rm s. on c o n tr a c ts T ru st Fund. any p e rso n in am end o r .r e v o k e s h a l l n o t b e p e r d p n a lly th e to r ig h t any o th e r THE T ru s te e s m ad e b y to a ll w it h S e t t le m e n t 13 • s h a l l be ir r e v o c a b le as to th a t th e m anner in an y pow er o r an y d is c r e t io n w h ic h th e co n fe rre d *% upon th e T ru ste e s fo r any p a r t ic u la r d is c r e t io n or m ig h t h a v e been (2 ) p ro p o sed th e of any su ch m a t e r i a l u p o n w h ic h by ANY m em ber o f IS th e pow er o r a n y such re aso n s re aso n s' such s h a ll or based e x e r c is e T ru ste e s t h is e x e r c is e * to I AND I T of S e t t le m e n t o r d i s c l o s i n g A n y o t h e r docum ent r e la t in g T ru ste e s by th e th e b y t h is of t h is at an y pow er o r a n y S e t t le m e n t th e co st of ( n o t b e in g t h e ir S e t t le m e n t A p p o in t e d or C la s s tru st le g a l or co n fe rre d a d v ic e on o b t a in e d e sta te ) th e p e r s o n a lly a n y d o cu m e n ts e x e r c is e d is c r e t io n E X P R E S S L Y P R O V ID E D t h a t th e th e r e la t in g TRUSTEES MAY P E R M IT to in s p e c t to th e any T ru st at copy th e p r in c ip iil o f f ic e be bound to A p p o in t e d o f any co rp o ra te g iv e C la s s any fu r th e r r e la t in g to a n y m em ber o f t h e A p p o in t e d ■ d o cu m e n ts 15 • r e la t in g T H IS Is la n d s th e o f each to th e e x c lu s iv e to th e la w s o f t h e th e and th e ju r is d ic t io n so m e o t h e r w h ic h s h a ll of p a r t ie s of t h is t im e to such th e a ll h e re o f p a r t ie s a c c o r d in g to th e m a t e r ia l ch an g e fo r I t im e d u r in g t h e T r u s t and th e th e any la w s th e to Caym an c o n s t r u c t io n be and s u b je c t o n ly a c c o r d in g th e fo ru m A c c u m u la t io n r ig h t s a c c o r d in g th e th e th e n of fo r th a t s e r v in g t h is ju r is d ic t io n of p a r t ie s h e re o f s h a ll the* l a w s o f in of T ru st of of in o f f ic e t h is P R O V ID E D and e f f e c t o f a ju r is d ic t io n r ig h t s a ll P e r io d Caym an I s la n d s ) o th e r ju r is d ic t io n th e to a d m in is t r a t io n c o n s t r u c t io n s u b je c t in of p e r m it b e s u b je c t * t o ^ th e e x c l u s i v e o n ly m ay n o t d e c l a r e and th e s h a ll be and o f th e h e re o f s h a ll (o th e r th a n be such T ru ste e s la w s w h ic h s h a l l b e d e c la r a t io n fo ru m th e n ce fo rth to T r u s t P R O V ID E D h o w e v e r t h a t t h e and c o n s tru e d th e c o p ie s and e f f e c t o f th e p r o v is io n s ju r is d ic t io n and T ru st or o f and c o n s tru e d o n e o r m o re o f t h e T r u s t e e s r e s id e n t th a t of th e th e • p r o v is io n th a t t h is d a te o f of a n y m em ber o f t o m ake a n y Caym an I s la n d s c o n s t r u c t io n fro m t h e of a ll ju r is d ic t io n m ay fro m b y deed d e c la r e C la s s m ade u n d e r t h e and e v e r y a d m in is t r a t io n T ru ste e s th e a f f a ir s to th e T r u s t . r ig h t s e ffe ct in f o r m a t io n h e re o f b u t s h a ll n o t ■ to S e t t le m e n t i s and tru ste e T ru st fu rth e r and th e th e is r ig h t s p r o v is io n s and c o n stru e d w h i c h w o u ld cau se a a n y m em b er o f » t h e A p p o i n t e d C la s s t h is h e r e u n d e r o r w h ic h w o u ld n o t r e c o g n i s e T ru st r e v o c a t io n IN if o r t e r m in a t io n and s e a l T R U S T L IM IT E D ab o ve w r it t e n . I] n o n -r e c o g n it io n W IT N E S S w h e r e o f t h e hand i; l! tt >i such and th e w o u ld r e s u l t v a lid it y in of th e o f th e T r u s t . s a id JO H N JtfjpREW F U R Z E h a s t h e Common S e a l h a s b een h e re u n to • jof s e t h is G U IN N E S S MAHON CAYM AN a f f ix e d th e d ay and y e a r f ir s t BE IT R EM E M B E R ED t h a t b e fo re me a N o t a r y on th e P u b lic in day and fo r of th e Caym an Is la n d s cam e a n d a p p e a r e d - h e w as p r e s e n t as and th e fo r w it h in h is w ho o n o a t h a n d d id act Deed and fo r see JO H N A . J U R Z E d u l y deed e x e cu te th e SWORN A N D S U B S C R IB E D t h is 19 p u rp o se s TO b e f o r e day o f a c k n o w le d g e t h e r e in s ig n p e r s o n a lly sw e ars and s e a l th a t and and d e liv e r m e n t io n e d . me a t G e o r g e T o w n , G ra n d 19 Caym an * w it n e s s N o ta ry P u b lic Caym an I s la n d s •P R O B A T E BE IT REM EM BERED t h a t b e fo re me a N o t a r y cam e a n d on th e P u b lic and fo r deed e x e cu te an d d id d u ly s ig n 19 p e r s o n a lly sw e ars SWORN A N D S U B S C R I B E D ! t h is and a n d o n . b e h a l f o f G U IN N E S S M AHON■ CAYM AN and s e a l and a s th e and fo r w it h in it s D eed act fo r and th e TO b e f o r e of me a t G e o r g e Tow n, G ra n d Caym an 19 j !i • __________________________________ W it n e s s th a t m e n t io n e d . jj day see a c k n o w le d g e * a n d d e l i v e r t h e r e in .. w ho o n o a t h fo r T R U S T L IM IT E D % th e Caym an Is la n d s a p p e a re d h e w as p r e s e n t p u rp o se s in day o f ' N o ta ry P u b lic Caym an Is la n d s ________ .TOHM ANDREW F U R Z E G U IN N E S S MAHON C A YM A N T R U S T L I M I T E D ' O r ig in a l T ru s te e D IS C R E T IO N A R Y S E T T L E M E N T e tx te > r ' X SU M A STU D & A S H F IE L D S T U D T e le n o n a c Beauparc, 0 4 6 -K lw O ffice & Y ard Navan, H SS ■84 6 2415S1 Home 1^1 f i r l D L V f~o ''-4 } r\ P o \ ~ i$ f c y\A— + I •)7 7 A * of- U A i < ^ $ f- *** *5~a— 1 ■ * 2 . 0 0 0 t *~~r\ of l-yv. (3 ^ tty* U. 1\ M ^ i? La— / U , (; InA-A / ’ *- M l-sjut fc -f-t— v c I « / U a ^ . i a. r-/l/ 6rv^^J/Li-ft V \ - f“ C ■ V v ^ # ( v ^ - l / W - a l»~f- ^ A a *^ / V ' ^ n . ^ U l . JT . hi-> ju jy vjt> ia - A — ) /-vll l<-4~r~-y) bL-j- lv **— ^W/V*\ K? , 1 l A ) < ” j/\J< / > *ju r\ Js ^ ------- r usj *— v £ - V V * — {Jf ^ t»WA. is jL - 4 . I Av«. ^ #V U- K+-+ M^V** U -4-y*l/ Vwtv-J *3u i _ o - ^ C. • 1^1 • \/t-y'*A»*-'lf-A l>* ^ C—>1 fV4 t ~ /r " ts-Ao u. lr* ^ v_ Hvt-if d u ^ U * ^ — ^v«— % — ~t ) /"tv*— » />*_* ^ / >-i>— hs*-$ ^) /tri-ww>-j h~r~l/ • / t^-o ^I^UVWVVfS-^-* iT W T , w J V. l~*>-J-+^el ASHFIELD STUD Telephones: Beauparc, 046-24161 Office & Yard 046-24155 Home NavanCo. Meath. 3 h )A*%a 'f-y^A^h. Inf L~Vx^_f }~t-4-~L A-N /w-tlf. /vj w-t- A?/J~vV, . 0^ / U— A/ V4 V— L ~ J / l~*Vs~ H~+- M v ^ m - V w ^ - l w v - v ^ i --- f \TuAiC-ioL H~xXr > s ^ ’T J t H J T ’ CcpLi/vii ^ 7*^0 M 7 * O w i ^ -v H v*> <*— «( /aA>Cd^»*»fc>^rj J>->Llvwi. C*. / V^/wv*-* r L ^ f 2. ? ^ R h u ^ f - W t ^ d w W A t W O O O q ’ X.^ / /* 4 ^ ^ t ^1/ I / 'v l ^ l t'V '—'C jl /M. Zv^. J- A^— J <:^ *1 ^t-^fV. 4 -w - It_/ U W U ^ v>— ? SUM A STU D & A S H F IE L D STU D /- n ' Beauparc, Navan, Co. Meath. W 046-24161 Office Se Yard i 046-24155 Home Lf*— )ft£~L.lr,£Vt3 Ic ptvu*r I# W y ><7 ^*-, A I U~_ L-v» t w w —) ) U f (uiM-l .Q t ^ 7 AvJ /'i^ jfS-AA— $ U-Vt-r ^XL j— H--i- Lf-#— h*-#Y-Is o f «^-v C *■"£/ 3 C? °/^ * o^ol U- <>- f w - H l bL~i- I \ M — »£, C ?***--) , , 'W-'i* / rtv^L S-t-M-A^y £ > i w i ■/- I J C>v-V e yf e X - 4 ~ \ * * > ~ * s * 'd ~ t ~ p ^ \ s C - y / / K-/-?_*Ub,{ ^ M — (- . / ^ ^ H ^ “ S-il(vvc^, < b v- u c w w v J , / w -S k / . L — il cVvw^vvX wL«_t , ,L ASHFIELD STUD Telephones: 046-24161 O ffice te Y ard ......... ............... 046-24155 Home hf. f / b xi j~ Ustsh b* v^. t J- Navan’ Co. M eath. ^ ^ u v J U * __ L c / / . l^ywUl l^i^- w ^ y M'w? /o jNAt/y^ t-** ^ ^ *■'— 4 ^v\ ^ y>* Ay*>vd (ri'L^t^ H v o t'wt' n^-a^ku. ^ ^Vv-rx— Wl— a— S A fu^ .?h-?hgu,u-v 1 I 1? 'm Maw! . juryLanna 36561 101 I68 he L. . up!? I 1 . . . c?"h?D l'flm mm: 5538? 135324 .1. I: .935? 'M"2:25. . . I 3 .31" I. M. 3 iv 4 ?334;: - ?93: ?3151.?: 33Ari53?: - - . . . sun-3:" "3 .I. -. . 1.. d'0"p . I but. ., ?5 hurt!? . . .31 :ti" .. . I .I - flaunt; 0.1 hadcomm" LVD sun citoti. I,u n □ CWMCSCV Accomrr sifniiitv *Ufc#f» Sum fv/> s* •*. *--• $ & !k - T*:r 2/5°o;oo; »t»?Z s .1>A' &Z I I * iu * n t and Lfclinc* •/•Own po o<«> lU ta m tftt fc/vt*ui J b« v ^ l l l t U-« ......... '" TtScphooeVdi444 . - (lowing) • . I *i\ r •5V~ G U IN N E S S + M A H O N L T D C UlNN Ctt HAMON CAYMAN T IU tT CTI -ir *— — -r"r - w . H I IK fO U N tl . 702444 ACCOUNT W M M M StlNfttV fUR COMPANY LEDGER C TA Ta u a M T M n O t f lIT t jvALUCOAtvj PARTICULARS & & I' I S»: \2 M AH7» *i jl«fr0t ^ 5. ; V-r-lr. - .•*•*»*« lkr- 1 15M C 77 micrr * ir $ ) ) '< s > t ^ f e i i b - i e : WANG ORIGINATING DOCUMENT 1464T COST CENTRE 6 REF MO 3680Y TOI ATTN* FROMI REFI 6 AND H DUBLIN . PAYMENT SECTION 6UINNF8S MAHON LONDON CT/CHM/1464T TEST A11017 ON 9000 VALUE 18/3/86 HE HAVE CREDITED YOUR ACCOUNT WITH USD 9000.00 AHT BEING FOR CREDIT TO A/C OF MARILY POWER ' ' B/0 GUINNESS MAHON CAYMAN TRUST. REGARDS C/T • 1 fti. >0 12(39 19.3.86 NO 1451-1903-01 i035 GUIMAN G* 13 MARS E l I. A p p e n d i x X V (108) M r F e r n a n d o P r u n a & M r s Eudelia P r u n a 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Fernando Pruna & Mrs Eudelia Pruna. a) Ninth memorandum of evidence of Ms Sandra Kells to the Moriarty Tribunal as adopted by M r Cathal McCarthy. b) Guinness and Mahon credit committee memo o f 21 December 1984. c) Letter o f 11 December 1984 - G M CT to Guinness and Mahon. d) Facsimile of 5 March 1985 - Guinness and Mahon to GMCT. e) Letter o f 15 July 1985 - GMCT to Guinness and Mahon. f) Guinness and Mahon credit committee memo of 19 July 1985. NINTH M E M O R A N D U M OF EVIDENCE of SANDRA KELLS GUINNESS & MAHON (IRELAKDtXEVnTED The Bank has been requested by the Moriany Tribunal to consider the following matters : 1. The general operation of the Ansbacher (Cayman) Limited accounts with the Bask 2. Details of the balances held in the said accounts from 1974 to date 3. Details of bow the loans; which were "back-to-back", operated and the mwnmgt ofthe expressions "suitably secured**or "considered adequate” 4. Loans to Pruna and Associates I set out, hereunder, a brief history of Ansbacher and other relevant subsidiaries of the Bank: ANSBACHER (CAYMAN) LIMITED In 1969 Guinness ft Mahon Limited (hereinafter called “Dublin") formed a small investment company in the Cayman Islands. tn October 1969 John Guinness, a then director of Dublin, was approached by John Collins, Manager of tbs Bank of Nova Scotia, to know if Dublin would be interested in financing the purchase of some land in Cayman. This was done and it was the start of Dublin's involvement in Cayman. In February 1971 Dublin formed Guinness Mahon CaymanTrust as a bank with a “B” licence. The issued capital was £10,000. The company was managed for Dublin by the Bank ofNova Scotia, with John Collins and John Furze, two Bank of Nova Scotia officials, responsible. The operation of the Cayman companies' accounts with Dublin was discussed by Mr. Guinness, Mr. Traynor and other officials in Dublin. This is reflected in Minutes of a Banking Committee Meeting held on 19th. November 1971. Onljth March 1971 an instruction was given to all departments of the Bank that no newVunent accounts or loan accounts could be opened without prior Board approval There was a change in the sterling area in June 1972. The effect of this change was that transfer of monies to Cayman required Exchange Control consent. With the Ob 15th January 1985 Joint Furze wrote to Dublin, informing it that some time ago Cayman had act up a £200,000 loan for i Cayman entity which was to follow the usual ‘'back-to-back” procedure. Unfortunately, the security was sever folly agreed by Cayman’s client and, as a result, Dublin was never advised. The loan, which was made by Cayman, had since been repaid. Advances wore made as follows: 1.4.84 9.4.84 3.5.84 S40.000 £100,000 S60.000. The loans wen at 14% per anufm, with a 2% differential in the value shared equally between Dublin and Cayman. Cheques totalling 1327,299.92 wen enclosed with the letter of 15th January 1985. There were three cheques, all made payable to Dublin. They were drawn by Maxima Investment Corporation, Florida. Mr. Fernando Pruna was the President andChiefExecutive ofthe said Maxima Investment Corporation. On 22nd February 1985 IXiblm credited Cayman's account with Guinness Mahon & Co., Ltd. in London with the sum of $325,349.96, representing the balance plus ix*erest on the backingdeposit accounts for Msxima Investment Corporation. The net effect of this, it would appear, was that Cayman entered into transactions, using Dublin, without notifying Dublin of die bet. The three chequea had to be put through Dublin, as they were madepayable to Dublin. Dublin made a sales of loans to Mr. Fernando Fruna and his wife, Edulia. The martnrnm amount outstanding at any one tfane by them in their own namea was SI,068,000. These loana weresecured by deposits try Caymanwith Dublin. Dublin agreed to advance the son of UJ5.S75.000 to a Mr. Jesus and Maria Barrios. This was secured by a property in Dade County, Florida. A deposit was also lodged by Caymanwith Dublin as security. . In August 1985 DubUn appeared, according to coirespondsnce, to have offered to make available to a Mr. and Mrs. Andreas Pruna the sum of U.S.S70.000, secured on a property in Miami Beach, Florida. The Bank has checked the Credit Committee Minute Books for 1985, the Executive Directors Minute Book for 1985 and cannot find any reference to any loan to Mr. and Mn. Andreas Pnma. The Bank, fixrthetmore, cannot locate any statement of account for such a loan. The Bank does not believe that such a loan was made by Dublin. In November 1985 Andreas Pruna wrote to Dublin, saying that he would not be able to make the first interest payment and that he had serious doubts that he could melee the principal payments when they were due. As a solution, he offered to transfer the deeds ofhis property in Florida to Dublin in lieu of foreclosure. . In Decanba 1985 Dublin wrote to Mr. and Mb . Andreas Pruna stating that, is lieu of foreclosure rffrig*, they would take is Dublin’s name or that of its nominee company, the title to the property. In flwmhf 198S Dublin arranged for the title to the property belonging to Mr. and Mh. Andrew Pnma to be registered in the name of MarsNominecB Limited, which is a wholly-owned subsidiary of Dublin. Subsequently, Mr. and Mn. Pnma tendered a quit qfatf deed in favour ofM n Nommeea. I believe due Cayman waa using the notepaper of Dublin to coadnct buainess and such ootepaper was used in relation to Mr. Andreas Pruna. In December 1986 Dublin agreed to advance to Raymond O. Fitzgerald 1243,000. This k>mwaa made at the request ofCayman. It replaced a loan of S243.000 made to Mr. Fernando Pnma and his wife. The loan was secured by a deposit by Caymanwith Dublin and a mortgageovers property in Florida. In September 1987 Dublin wrote to an Attorney in Florida, instructing him to draft a warranty deed, wherein Man Nominees Limited conveyed the property surrender by Andreas Pruna to Maria Isabella Moore de Pnma, the wife of Andreas Pnma. The warranty deed waa duly signed and sealed by an officer of Mm Nominees Limited on 25th September 1987 in fkvour of Mrs. Andreas Pruna. It was then retmaed to the Attorney or to Andreaa Pnma. ft ia not certain who obtained same. In September 1987 John Fane wroteto Padraig Colkry regarding Dublin’s advancing U.S.S2.1 miQkmto hforthaide Management feDevelopmet* Company. Thia company was involved in a property development in Atlanta, Georgia. ftiblk would receive corporate guaranteea from Maxima Investment Corporation, of which Mr. Fernando Pruna waa President, as well as Barrows Holding Limited (a Channel Islands company). Dublin would also receive a deposit from Cayman of U.S.S2.1 million, which deposit Caymanwould hypothecate in favour ofDublin. On 1st October 1987 Cayman wrote to Dublin, informing it that they had advanced U.S.S2.1 million, held in escrow, pending the closing on 2nd October of the transaction in Atlanta, Georgia. On 1st October 1987 Dublin agreed to advance to Maxima Investment Corporation a sum ofU.S52.1 minion. A deposit was placed by Csymanwith Dublin. On 4th February 1988 Dublin wrote to Cayman, saying that there were no payments since 28th July 1987 on the Raymond Fitzgenld loan. On 10th February 1988 Cayman wrote to Dublin. They stated that they had received no response from Mr. Raymond Fitzgerald and suggested that Dublin would write the loan off against the deposit at a value dated 3rd February 1988. On 3rd June 1988 the U.S.S700,Q00, being the balance of the ban to Mr. and Mn. Fernando Pruna was discharged. On 9th 1988 • firm of lawyers, Wallace, Engels, Pertenoy, Msrtin & Solowsky, based in M*—1*, Florida, wrote to Cayman. They inlbnned Cayman that Qmd Jury bad been served on their firm regarding Cayman, Dublin and Man Nominees * The Assistant U.S. District Attorney overseeing the investigation that he was interested in obtaining documents from the three cftmpfni—and that he might issue additional subpoenas to the companies themselves for the production of the documents. The Assistant U.S. Attorney had, apparently, received that Mars Nominees Limited was a subsidiary of Cayman and that it held property in Dade County, Florida. Mr. Wallace of the firm was the Registered Agent for Cayman and Dublin and therefore the service of the subpoenas on him was valid as against Cayman and Dublin. The Subpoenaa sought1. AH documents and records pertaining to loans made to Fernando Prune, Andreas Pnma sod their wives/or other fiunily members, including all correspondence related to such loans. 2. AHdocuments and records pertaining to loans made to any corporation, other entity to which Fernando Pnma or Andreas Prune was an officer, directoror ocu^orstockholder 3. AH documents, correspondence and other records pertaining to any transfer of property, either reel or penonal, between Fernando Pnma or Andrees Prune and either Gunmen Mahon Cayman Trust Limited, Dublin or Mars Nominees Tjwimil , ' 4. All documents, correspondence and records pertaining to Mars Nominees l .im ltirf 5. AH records pertaining to any account in name or names of Fernando Prune, EudaHa Praia, Andreea Pnma, Maria Isabella (nee Moore) fame or any person W entitiee acdnc aa nomhiaaa for anv ofthose namednarsons. iachidihB Without limitation, (a) accounts statements, (b) certificates of deposit and (c) depoait tooltSfboosncowJk* StfltfflEMMBtSpVlpttFCd toy or on behalf of Fernando Pnma, Andreas Fkoaa or any corporation or other business entity in which Fernando Prune or Andrees Prune is an officer, director or mqjor stockholder. The period covered by the subpoenas was 1st January 1981 to 1st September 1988. The subpoenaa were to be complied with by 23rd September 1988. On 20th September 1988 Mr. Wallace wrote to tha Assistant United States Attorney, raising issues aa to jurisdiction snd whether or not the subpoenas were binding on Cayman, Dublin or Min Nominees Limited. On 22nd September 1988 Cayman changed its name from Guinness Mahon Cayman Trust Limited to Ansbacher Limited and wrote to the late Desmond Traynor. Mr. Furze, who was the author of the letter, stated that the Pnma brothers had been clients for a number'of years. Although oot mentiooed m the correspondence, Cayman was fiurly certain that the subject of the Grand Jury investignion was narcotics. This was the sobpoaan were served by a U.S. Federal Customs Agent at weU aa local police kfbnutkm that the Prunes involvement was with illegal substances. Mr. Forte stated that DubHn wen involved, since at one time Cayman maintained a beck-to-back $ituation with Fernando Pnma and hie wife, which has bean been cleared by the sale of the property in Miami. Man Nominees waa involved by virtue ofthefoctthat Andreas Pruna, registered the Florida property in that n*me, a&ct not known by Mr. Fane. Although Mars Nominees executed a transfer over the property a year ago, fnm*"riy the documentation was never registered. Mr. Fune’s understanding was that Andreas Pnma was in custody in a Federal penitentiary and that the United Statea Government was pursuing extradition proceedings against Fernando Pruna. who was in Argentina. Mr. Furze was copying the letter to Padraig Colleryto put him on notice. On September 1988 Cayman wrote to Padraig CoQery, enclosing a copy of a letter to Desmond Traynor. He said that he tad discussed the situation with Des Traynor, as a rerah of which they were of the view that, if Padraig Collery were approached by any person or entity in relation to die ownership of the property by Mars Nominees and the intended sale of tame, Mr. CoQery should merely indicate that he had received no instructions from hia client and was therefore unable to be of any assistance. On 27th September 1988 Cayman wrote again to Padraig CoQery and referred to a telephone conversation between Mr. CoQery and Martin Laniga&'O’Keeflfe with Mr. Furze. On 18th October 1988 Mr. Wallace of Wallace Engels wrote to Padraig CoQery rggMiting subpoenas. Ha stated that,unleas then were special circumstances, his suggestion waa that Dobfin expeditiously famish the records which had been snbpoened. ■ On 23rd Msrch 1989 Dobttn signed a quit claim deed on tfce property in Atlanta, wherein a loan had been peid by Dublin to Noithaide Management & Development Company. On 18tfeJtaly 1989 Cayman wrote to DubUe. stating dun the U.S. Government had filed an arrest warrant against die property in Atlanta. Northgate Investments limited (a Cayman compeny managed by Cayman) being the nltimete beneficial owner of the property had reUnqirishad any claim which it mijtftt have to die property and did not attend to contest the forfeiture action. On21st July 1989 Dublin wrote to the Attorneys acting in Atlanta, informing the Bnn that Dublin did not intend to contest the fotfcituie and, accordbgly, would be grateftil if the Snn of Attorneys would take no action to contest same. Any claim which Dublin may have had m the property was thereby relinquished and they would be grateftilifthe Attorneys could forward the appropriate quit claim dead for execution. On 20th Hoi«mber l989 the Attorneys in Atlanta received a quit cUim deed for sabmissfefttoDabtin. ■ On November 1989 Cayman wrote to Dublin, enclosing a copy of the latter from the Attorneys in Atlanta. They stated that Mr. CoQery would know the “backto-back” loon waa discharged from the deposit proceeds some time ago. Therefore the of the deed would not now involve Dublin in any father participation with the particular real estate development . On 30th November 1989 the U.S. States Attoraey for the Southern District of Florida served a complainton Dublin’s Secretary. The complaint waa for the forfeiture ofthe property previously owned by Mr. and Mrs. Andreas Pruna in Miami, Florida. On 30th November 1989 the U.S. States Attorney for the Southern District of Florida served a complaint on Man Nominees Limited’s Secretary. The complaint was seeking the forfeiture ofthe property owned by Mr. and Mrs. Aakeaa Pruna. On 8th December l989 Caymanwrote to Mr. Wallace, the Attorney in Florida. They stated that they were aware of the propertyforfeiture notice but, since the client was in Jail and that aU Cayman’s other records had been sumsndered to the U.S. Authorities under the Narcotics Agreement in 1984, Cayman suggested that no action betaken. On 12th Decamber 1989 Cayman wrote, again, to Mr. WaQace. Theysaid that in or around 1984 they had been associated with Andreea Pruna a d had various business dealings through a Cayman company known aa Fathom Rv» Rhns Limited. At the time of their association to-. Pruna owned the property in Miami. In 1983, unknown to Cayman, Mr. and Mra. Prunatransferred the property to Man Nominees Limited, a compeuy wholly-owned by Dublin. Cayman was advised after the feet and, in September 1986, on jnsttuctloaa from Cayman, Mm Nominees Limited transferred title to the nrsoertv. bv eneudnc under seal a auk claim deed which waa delivered bv John Ftarae to Andreea Pnma, with instructions for the transfer to be registered. Such registration, however, did not happen - hence the reference to Man in the arrest wairant Cayman said that Dublin waa concerned at the allegations that Man was owned by Pransu Their waa that, by hofag m A tht complaint, imm Im^mm fmhftmA mrtA njj f^TTHffait thf the company was owned or controlled by Pruna. Cayman was seeking advice on three issues(0 whatactkm, if any, did Mr. Wallace recommend to be takento correct the error in the compiakt relative to Man Nominees limited? (H) to what extent might Man Nominees Limited be advenely affected it in any ftxturetransaction hi the U.S. by virtue ofhaving been named in the complaint? (iii) Dublin had bean served with the srrest warrant and complaint, as naturally had Man Nominees Limited. To what extent should they acknowledge the service process? . hi January 1990 a partner of Mfc Wallace, Jay Solowsky, wrote to Cayman and copied the letter to Dublin. Man Nominees Limited had been listed on the Drug Bofcw dMrt Naddis, computer. He advised dot, if M n Noauoees Timi»wri hidfature transactions is the U.S., it was possible that the transaction would be considered suspect. On 2nd March 1990 Mr. Solowsky wrote to Cayman, saying that he had spokes with the Assistant U.S. Attorney. She had requested that the Attorneyprepare an affidavit aw^iaitwmg any interest in the property. Mr. Solowsky woold send the Affidavit to Cayman shortly. Subsequently, Dublin returned to Mr. Solowsky the Affidavit and Waiver ofdidm; . On 23rd March 1990 the United States District lodge far the Southern District of Florida an order dut a Letter Rogatory be entered into and that tame be dettvared to the Assistant United States Attorney for transmission to suitable channels ofthe apf*opriate judicial aatk>ritiee to the Rejwblfc ofIreland. The letten Rogatory f*«*H that the United States Attorney is conducting an investigation of an alleged, organised crime drags """n 1*"! operation, heeded by Fernando Prune. An had been handed down and it charged Pnma and the members of his organisation with crimes including operating and conspiracy to operate a continual criminal enterprise dedicated to the importation of cocaine and marijuana into the United States, from 1981 to 1988. The U.S. Attorney waa informed that evidence relevant to the inveetigation might be located at a bank in ItobHn, Guinness & Mahon Limited, 17 College Green, Dublin 2. Evidence that had developed so for showed that the alleged organisation utilised several bank Kcoonts located sft Guinness ft Mahon and CaymanTrust Limited in the Cayman Islands to deposk profits from alleged drug snuggling operations and to facilitate the movement of the profits from drag smuggling to other bank accounts located in countriss throughout the world. This Cayman Trust waa a subsidiary of Guinness Mahon Limited, a Dublin bank at 17 r n iiy Gran. The Dublin baric had now sold die Cayman 'Croat to Ansbacher Limited. The Dublin headquarters of Guhmeu ft Mahon Limited held certain fa? pram mnA their aaaociates and n d hypothecated deposits made by the Prunes. Correspondence concerning thm matters passed between the Trust in Grand Cayman and the offices of Pat O’Dwyer, J. D. Traynor ■id Padraig CoQary and othsrs in the Dublin bank. These deposits and tranaactiom u m a a t solf jathtP m ai' am i4 thnr aaiodflttt’ hot alao in die ««w«« of their nonttnw* operations. Bor example, records show that Guinness ft Mahon Limited held mortgagee or interests in Pruna property. The entitiee and persons that they were the subject ofthe requestwere as follows: . 1. 2. 3. 4. 5. Fernendo or EuduKaPruna kora mortgage ' AndreesPnma Mata Nominees Westwind Investment : Maxima Investment : Northaide Manegarnwif ft Development, Northgst* Investments Landed, Texas ATM Ranch, Barrow Holdings Limited. Westftre Condominnan Project 6. Jesus Barrios and Maria Barrioe. N'ME OP APPLICANT Fernando & Mrs. Eudelia Pruna. ADDRESS : c/o G.M.C.T. P. O. Box 887, Grand Cayman, B.W.I. BUSINESS / OCCUPATION AMOUNT : U.S.5I35,000.00 PURPOSE : Personal TERM : I year maturing 2nd October, 1985. 14% p.a. fixed. COMMITMENT FEE : Nil. DRAWDOWN : By way of loan account. SECURITY ! The following security held by G.M.C.T. to our order. 1st Legal Mortgage on 12505 Keystone Island Drive. No. 1 Lot i4 Block 2. Guarantee signe dby them. Security may be taken as adequate. See o ve r BACKGROUND NOTES / OUTLINE OF PROPOSAL : ■ We have been requested by G.M.C.T. to make the above toan available. The deposit will earn interest at 13% p.a. Interest is payable quarterly in arrears and G.M.C.T. have undertaken to collect interest on our behalf. See RECOMMENDED REVIEW DATE :2nd October, 1985. Recommended i< h BOARD minute DATE - ’ ■ $ +) GUINNESS MAHON CAYMAN TRUST LIMITED A M e m b e r o f t h a G u ln n e a s M a h o n M w e h a n t B a n k in g G r o u p T a ta p h o n a N o (8 0 9 -9 4 ) 9 4 8 5 3 /4 T a tM CP 4 3 0 5 P .O . B o x 8 8 7 Grand Cayman . C a M A d d ra a a Q um naaa B rtB a h W a a * Iik Mm Via courier service yourraf our rat JAF/fdef 11th December 1984 Pat O'Dwyer Esq., Guinness & Mahon Ltd. 17 College Green Dublin 2 IRELAND Dear Pat, 1 should be grateful if, value 1st October 1984, you would establish on your books a loan of US$135,000.00 to Fernando Pruna and his wife Eudelia Pruna in accordance with the attached copy commitment letter. Our deposit with you is for a like amount at 13 ■A.’i--'-.>^4'*' Vftr wf * i\ S / S vm\ i M r t J £ 0 7 0U8tiA(’ »• i i, *1 '’- . 1^-■■ '”'‘ i*V;' , , u •'.■'"w-' . .I.V I. H . s- ^ \ # r /'. f r m a - • GUINNESS M AHO N CAYMAN TRUST LIMITED A M w n tw r o f t h e O u t n n a e s M a h o n M e rc h a n t B a n k in g G r o u p T e le p h o n e N o (8 0 9 4 4 )9 4 6 5 3 /4 P .O . B o x 8 8 7 T e le x C P4306 O f * * C aym an C a b le A d d re e s Q u tn n e e a . B r ttto h w * * ' l n d l a * July 15, 1985 your rat our ret JA F / ro b Pat O'Dwyer, Esq. Guinness C Mahon Ltd. 17 College Green Dublin 2 IRELAND Dear Pats 1 should be grateful if you would establish another "back-to-back" this time for $160,000 value 15th April 1985, security for the loan being a first mortgage charge over 2351 Keystone Boulevard, Miami, The loan once again is to Fernando B. Pruna and Eudelia Pruna^anfv I will forward the mortgage documentation in due course. /-v Loan interest is at 11% p.a., a cheque for two months interest being enclosed. Future interest payments are due quarterly, the next being on 15th September 1985. Interest on our deposit with you will be at 10% p.a. amcyjwefflg to $2,666.67. Please credit our account in London w^,th^Jbrfs amount. Please let me know if you have any queries. Yours sincerely, "JOHN A. FURZE .DDRESS : c/o, G.M.C.T. P. 0 . Box 887, Grand Cayman, 8.W.I. lUS^SS / 'HIS APPLICATION : TYPE Loan Yes / No Permission Obtained Company Director and wife. JCCUPATION : C B , Approval : Date : N'A New Facility / ( Delete as appropriate ) am ount V-H?.3.Si22?.. FEE : R A TE U.S.$I60,000 Loan If new or increased facilities, is drawdown permitted prior to completion of security ? PURPOSE / DRAWDOWN : By way of Loan Accounts YES j j /N O REVIEW DATES : TEk M OF FACILITIES : 9 months. 10 months 3rd March, 1986. M ISth April, 1986. ^ . If additional or existing facility, i i security in order ? YES / NO 1 1 1 I If No, give details separately. 1 I SOURCE OF REPAYMENT : ' Not stated. SECURITY : . 1st Legal Mortgage over 2351 Keystone Devd, Miami, Florida taken by G.M.C.T. Security considered adequate. BACKGROUND NOTE / We have advanced funds to the above In the past on the instructions OUTLINE OF PROPOSAL :of G.M.C.T. We have now received, a further request from G.M.C.T. to set up the abvoe two loan. An interest differentiatwill apply between the loans and the backing deposits. G.M.C.T. collect the interest on a quarterly basis. Related Facilities / Borrowers : ( Balance or Lifuit, whichever is greater ) Minute Due Recommended_________ board Total Exposure : $395,000.00 MillUte HHIHMMM* Ostfi «••••*••••••« A p p e n d i x X V (109) M r S e a m u s Purcell 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Seamus Purcell. a) Transcript o f evidence o f M r Seamus Purcell dated 28 June 2000. b) Cheque dated 26 January 1982 in favour o f Ms Seamus Purcell. c) Guinness and Mahon statement of 20 May 1982 re GMCT. d) Deposit a/c authorisation o f 8 February 1984. e) Deposit a/c authorisation o f 6 February 1984. 7 UNDER OATH ON WEDNESDAY, 28TH JUNE 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MR. ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. SEAMUS PURCELL Represented by: MR. KEVIN BARRY KENNEDY McGONAGLE BALLAGH 20 NORTHUMBERLAND ROAD DUBLIN 4 WITNESS MR. S. PURCELL I EXAMINATION MR. JUSTICE COSTELLO PAGE 67 1 2 3 4 MR. JUSTICE COSTELLO: 5 Mr. Purcell, we will start our interview then. I 6 will begin by introducing myself. 7 Declan Costello and on my right is Ms. Mackey and on 8 my left is Mr. Rowan. 9 Inspectors who have been appointed by The High Court 10 I am As you know we are the in this matter. 11 12 I should explain to you that, as I am sure your 13 solicitor has already explained to you, this is not 14 a Court of law. 15 interview. This is not a Tribunal. This is an We are going to ask you questions. 16 17 If during the course of the questions you wish to 18 take the advice from your solicitor please tell us 19 and we will stop asking you questions. 20 21 Similarly, if in the course of the questions we ask 22 you your solicitor wishes to give you any advice, he 23 can indicate this to us, and we will stop asking 24 questions. 25 26 Mr. Purcell, your evidence will be taken under oath 27 and I will now ask our solicitor, Ms. Cummins, to 28 administer the oath to you. 29 1 Gentleman, obviously I 2 3 would point out that Mr. Purcell attends pursuant to 4 your powers under Section 10 and not voluntarily. 5 MR. JUSTICE COSTELLO: Yes. 6 MR. BARRY: And under protest. 7 MR. JUSTICE COSTELLO: That is understood. 8 MR. BARRY: Obliged, Chairman. 9 hand that in. 10 copy of the statement. 11 MS. MACKEY: 12 MR. BARRY: I will That is a We sent a draft out to you. Yes. 13 There is one very small amendment, which I have 14 left just marked. 15 MR. JUSTICE COSTELLO: Very well. 16 MR. BARRY: It is just a word changed 17 18 19 20 21 22 23 24 25 26 27 28 29 to usual. 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Purcell, could we begin by you giving us a 6 brief account of your career in business, both here 7 and in Northern Ireland, and the companies with 8 which you carried on this business? 9 outline of your career in business is what I would like at the beginning? 10 11 Just a brief A. Well, my career in business is: I started working in about 1937 with my father. 12 13 2 Q. 14 A. 15 3 Q. 16 A. Yes? I was selling cattle and sheep in Ireland. Yes? And then times were very bad at the time and there 17 was a big family of us, about ten in the family. 18 that time then, after a few years, when we started 19 to earn a bit of money I paid off our debts, my 20 fathers debts. 21 had all that done, I started on my own in 22 about 1943. 23 4 Q. 24 A. At Then when I had all that done, we Yes? And I looked after the family, all the family, from 25 there on until they all got big and went there ways. 26 So, then in about 1950 I started exporting to 27 England and I worked there until 1970. 28 1970, in the 1960/70, I sent cattle to the Caribbean 29 and to different places, Portugal and different Then in 1 places. 2 the Middle East. 3 5 Q Then after that I started shipping to If I could just pause there for a moment. You said 4 about 1970 you worked there. 5 Ireland, were you, and exporting to England? 6 A 7 6 Q Exporting to England, yes. Then in 1970 you commenced then exporting to the Caribbean, is that right? 8 9 You were based in A Yes. In the late 1950's, if we go back to the late 1950's. 10 11 7 Q 12 A Yes ? I am sorry I am just getting way. At one time 13 Mr. James Dillon, when he was Minister for 14 Agriculture, asked me to go to France and I went to 15 France and I had -- there was a contract there and I 16 took that contract. 17 to outside Britain. 18 8 Q Yes ? 19 A Yes . 20 9 Q 21 Then in 1970 you branched out to the Caribbean and Portugal, is that right? 22 A 23 10 Q 24 A 25 11 Q 26 27 That was my first time shipping In 1960. Yes, in 1970, yes. Yes ? Yes, that is right. I interrupted you. If you could just continue now Mr. Purcell? A Then I exported to the Middle East. From 1980 to 28 1982 or something, in one year, I shipped 317,000 29 cattle from Ireland. 1 12 Q 2 A 3 In about the 1982, I think. I am not quite sure of that. 4 13 Q 5 A Yes ? And then I did some barter deals. A barter deal for 6 all meat and cattle and sheep; sheep from Australia, 7 meat from Ireland and cattle from Ireland. 8 14 Q 9 A 10 15 Q 11 A Yes? And that was for $155,000, a barter deal. Yes ? And then in 1985, about 1984/85, I bought some meat factories. 12 13 16 Q 14 A 15 Yes? And between the North of Ireland and the South of Ireland we killed 10,000 cattle a week. 16 17 Q 17 A Yes ? And we shipped every bit of that. We never put one 18 bit of meat into intervention. 19 years, after -- at that time, when we were killing 20 1 0, 0 00 cattle a week, we were shipping 1 1 ,0 0 0 cattle 21 a week. 22 18 Q 23 A Then after a few Yes? And then unfortunately we had some problem with the 24 Department of Agriculture. 25 refunds on us and the banks came along then and 26 looked for their money back. 27 million and 80 million in bonds. 28 for everything so I had to sell all the assets and 29 pay them and I paid them. They held up a lot of I owed the banks 49 They came looking 1 19 Q 2 A 3 That happened in 1986 or 1987 or 1988. I think 1986. 4 20 Q 5 A 6 21 Q 7 A Yes ? About 1986 I think. Yes . Yes, and I paid them back the $49 million and I got 8 back all the bonds by January of that year, of the 9 next year. 10 22 Q 11 A Yes ? So, that is the whole thing. Then I had to fight 12 back and try and come along again, and try and run 13 back and forward like. 14 trusted me. 15 credit. 16 23 Q 17 A 18 24 Q 19 A At the time then the Marts Marts trusted me and they gave me Yes ? And that was a big help to me. Yes ? So, I restocked away and shipped them, and got 20 Letters of Credit, and paid the Marts. 21 was still behind me at the time. 22 still behind me at the time. 23 25 Q 24 So, the Mart The farmers were After these problems in the late 1980's did you then continue the business of shipping cattle? 25 A 26 26 Q 27 A 28 27 Q 29 A Yes, I did. Yes? I never stopped. Yes. And you are still. You have not retired? 1 28 Q. 2 A. 3 29 Q. 4 A. 5 30 Q. 6 A. 7 31 Q. Your sons. Yes? In 1991. Yes? It think it was something like that. Yes? But I haven't retired. Yes. I work for my sons. I am sure with this large business Mr. Purcell 8 you had a number of companies, incorporated 9 companies. I just wonder was there any main company 10 that you did most of your business through, your 11 export business? 12 A. 13 In the 1970's, around there, I did it in Seamus Purcell's name. 14 32 Q. 15 A. 16 33 Q. 17 A. 18 34 Q. Your own...(INTERJECTION)? In my own name. Your own private name? Yes. You own private name. It was not in the name of a company? 19 20 A. 21 35 Q. 22 A. 23 36 Q. 24 A. No, Seamus Purcell. In the 1970's. Yes? In the 1970's, yes, and also into the 1980's. Yes? I had one big contract in 1980 with Libya to fly 25 meat out everyday and that went on from 1980 to 26 1985, and that was in Seamus Purcell's name. 27 37 Q. 28 A. 29 38 Q. In your own name? Yes, my own name, yes. Yes. When did you start doing business through 1 2 3 39 Q. 4 A. Yes? I think we formed that company in about 197 6 but I 5 never used that company much until about 1983 or 6 1984. 7 40 Q. 8 A. 9 I am not quite sure about this. Yes? Because the contracts were not in Purcell Export's name, they were in my name. 10 41 Q. 11 A. In your name? Yes, in that time and how I remember that so well is 12 just a couple of years ago I introduced this 13 Egyptian man. 14 Eddie Kearns in Waterford Castle Hotel and he said, 15 "I suppose you know Seamus for a while?" He said, "I 16 have good reason to know him." He said, "I have 17 spent $270,000,000 with him." 18 Government men. 19 42 Q. 20 A. 21 43 Q. 22 A. 23 44 Q. 24 He came over and I introduced him to He was one of the Yes? So, that will just tell you the...(INTERJECTION). Yes? Yes, the type of the business. Your carried on business in your own name. Then in the 1980's you started using Purcell Exports Ltd? 25 A. 26 45 Q. 27 Yes, yes. Were there other companies too that you carried on this export business? 28 A. 29 46 Q. No, there wasn't, no. Well... (INTERJECTION)? Not at that time. 1 2 47 Q. 3 A. 4 48 Q. 5 That is what I am coining to? Yes. That was a Northern Ireland company, was it not, Purcell Meats? 6 A. Purcell Meats, yes. 7 49 Q. 8 A. That is correct, yes. 9 50 Q. And...(INTERJECTION)? 10 A. Yes? But that was only -- I think that was about 1984 or something like that. 11 12 51 Q. 13 A. 14 52 Q. 15 A. 16 53 Q. 17 That was later? Yes, later. What about Excelsior Enterprises Limited? Pardon? Excelsior Enterprises Limited, do you remember a company in your group of companies by that name? 18 A. 19 54 Q. 20 A. 21 55 Q. 22 A. 23 56 Q. 24 A. 25 57 Q. No. You do not? No. It was Ulster Meats Limited then? That is correct, yes, Ulster Meats. That was the other company? That is right, yes. Yes. I want you to describe Mr. Purcell, in as much 26 detail as you can, when you first had business 27 dealings with Guinness & Mahon and your meetings 28 with Mr. Traynor? 29 1 2 58 Q. 3 A. Yes? And at that time I met Mr. Traynor then I got an 4 overdraft from him. 5 from Guinness & Mahon. 6 59 Q. 7 A. I got money. I borrowed money I got it. Yes? And I got that on the strength of Letters of Credit 8 like that I would have coming in from different 9 countries. 10 60 Q. 11 A. 12 61 Q. 13 Yes. Who looked after your ordinary commercial affairs, did you? 14 A. 15 62 Q. 16 What was your Bank? My bank at that time was Guinness & Mahon. Did they operate for your ordinary affairs as well as all your commercial affairs? 17 A. 18 63 Q. 19 A. 20 64 Q. 21 A. 22 65 Q. 23 A. 24 66 Q. 25 A. 26 67 Q. 27 A. 28 68 Q. 29 You had bankers Mr. Purcell? They...(INTERJECTION). Did they? Well, they did all my financial affairs. Yes? They looked after. All your financial affairs? Yes, yes. Were looked after by Guinness & Mahon? Yes, yes. Did you have a current account there? No. What sort of account did you have with 1 just on account. 2 3 69 Q. 4 A. 5 70 Q. Yes, I had a cheque account there. You had a cheque account? Yes, certainly, yes. That would have been a personal account in your own name? 6 7 A. 8 71 Q. 9 Yes. In addition then did you have loans from Guinness & Mahon? 10 A. 11 72 Q. 12 A. 13 73 Q. 14 Yes, I did. A lot of loans. A lot of loans? Yes. They would lend you money on the strength of Letters of Credit which you were obtaining? 15 A. 16 74 Q. 17 A. 18 75 Q. That is correct. From people who were buying goods from you? That is correct, yes. Yes. I would just like to find out how long did it 19 go on that you used Guinness & Mahon exclusively? 20 Did you move to another bank or banks later? 21 A. 22 23 something like that. 76 Q. 24 25 I used Guinness & Mahon up to 1990 or 1991 I think, We know Mr. Purcell that you also used the Ulster Bank, is that not correct? A. Yes, on the meat business. That is not...(INTERJECTION). 26 27 77 Q. 28 A. 29 78 Q. Yes? It was on the meat I was with the Ulster Bank. Yes. Are you making a distinction then between the 1 2 A. 3 two different...(INTERJECTION). 4 79 Q. 5 A. 7 80 Q. 8 A. 9 81 Q. 10 A. 11 82 Q. 12 A. 13 83 Q. 14 Yes, they are two different, two separate, Your meat business then? Yes. Your bankers were Ulster Bank Limited, were they? Yes, they were a consortium. A consortium of banks? Yes, a consortium of banks. However, your cattle export business remained with Guinness & Mahon? A. 16 That is correct. All my live business remained with Guinness & Mahon. 17 84 Q. 18 A. 19 20 Dividing the two of them up? companies altogether. 6 15 I am dividing the two of them because they are Yes? And then Guinness & Mahon helped with some bonds for the meat and different things. 85 Q. Yes. Not only did you have an account in your own 21 name but you started using the company 22 Purcell Exports Ltd in 1983 or 1984? 23 A. 24 86 Q. 25 A. 26 87 Q. 27 28 29 I am not quite sure when that was. Yes? Whether it was 1982 or 1984 I am not sure. I see. However, around about the early 1980's you started using it? A. Yes, something -- I thought it was nearer to the middle 1980's but I am not sure. 1 2 3 4 5 88 Q. I see. account in the name of Purcell Exports Ltd? A. Yes. 89 Q. In Guinness & Mahon? A. Yes, I did, yes. 6 90 Q. Yes? 7 A. Yes. 8 9 10 11 Then whatever date it was, did you have an I am sure I did. but I am nearly sure I did. 91 Q. Yes? A. Yes, yes. 92 Q. The company Purcell Exports Ltd, its address is 14 12 Clyde Road? 13 A. That is correct. 14 15 16 17 18 19 20 21 22 23 24 25 93 Q. That was Mr. Stakelum's [sic] office, were they? A. There was -- pardon? 94 Q. Whose offices were they? A. They were belonging to Mr. Woods I think. 95 Q. Mr. Woods? A. Yes, Mr. Frank Woods. 96 Q. Who is he? A. He owned the offices. A. No, I don't think so. I think he was a developer. 98 Q. A developer? A. I think so, Mr. Woods, yes. 99 Q. Yes? 27 A. Yes. 29 I rented from him. 97 Q. Is he an accountant? 26 28 I am not quite sure of that 100 Q. You must have had accountants in your business. Yours was a very big business? 1 2 101 Q 3 business? 4 A 5 102 Q 7 A 8 103 Q 9 A 10 104 Q 11 A Then you would have had accountants acting as Yes . Who were they Mr. Purcell? Well, at the time it was Pat McGuigan. Where were they? Hugh O'Donnell & Company. They were based...(INTERJECTION). 12 13 105 Q 14 A Sorry? Hugh O'Donnell & Company. They were based in Limerick. 15 106 Q 17 Yes. Was he your auditors for a good number of years Mr. Purcell? 18 A 19 107 Q 20 A 21 108 Q 22 A 23 109 Q 24 He was, yes. Yes? From -- back from the 1950's I think. From the 1950's? Yes, back from the 1950's. What about your own personal tax affairs? accountant assisted you on those? 25 A 26 110 Q 27 A 28 111 Q 29 Yes, we have, yes. auditors of your business as well? 6 16 You must have had accountants employed in your That company. Yes? That company, Hugh O'Donnell & Company. What 1 112 Q. 2 A. 3 113 Q. 4 A. And Mr. McGuigan in it? That is right, yes. Is Hugh O'Donnell & Company still in practice? No, they have changed. You see there (INDICATING) 5 They are -- I think they have changed a couple of 6 times. 7 114 Q. Yes . 8 A. Yes, 9 115 Q. 10 A. Yes . 11 116 Q. Yes . 12 A. Yes . 13 117 Q. With 14 A. Yes, 15 118 Q. Yes? 16 A. That You 17 went out on their own out of that company, we deal 18 with those. 19 119 Q. 20 A. Sorry? We deal with the people that left the company, you 21 understand? 22 in Hugh O'Donnell's company. 23 120 Q. 24 A. Hugh O'Donnell, yes? And when the company broke up then I think some of them went to Coopers & Lybrand. 25 26 121 Q. 27 A. 28 122 Q. 29 They were in the company originally, Coopers & Lybrand? Yes, that is right, yes. I am talking about your own personal tax affairs 1 2 123 Q. Are they with somebody in Coopers & Lybrand? 3 A. 4 124 Q. What... (INTERJECTION)? 5 A. Not Coopers & Lybrand. Yes. 6 company now? 7 MR. BARRY: What is the name of the I think the statement is Grant Thornton, is it not? 8 9 A. 10 125 Q. 11 A. 12 12 6 Q. Grant Thornton, yes. Yes? Grant Thornton. What is the name of the person with whom you are 13 dealing with? 14 affairs ? 15 A. Who is handling your own personal What is the name now? 16 Frank Gleeson? 17 his name. 18 127 Q. 19 A. 20 128 Q. 21 A. 22 129 Q. 23 A. 24 That is right, yes. Mr. Gleeson. Is it Frank, I am not sure if Frank Gleeson is Any way you can recall it later? Yes, yes. And you can let us know? Yes, yes. I want to bring you back...(INTERJECTION)? No, sorry. I am sorry. Gearoid Costello is the name . 25 130 Q. 26 A. 27 131 Q. Gearoid Costello? Yes, sorry. That is it, yes. I want to bring you back Mr. Purcell to your first 28 dealings with Guinness & Mahon. 29 introduced to Guinness & Mahon, do you remember? How were you 1 How did it come about that you took them on as your 2 bankers ? 3 At the time I was having contracts and I was getting 4 it very hard to get bonds like. 5 have may be a bid bond going out for a contract and 6 I was told to go and ask Guinness & Mahon. 7 went and asked. 8 Mr. Traynor and asked him. 9 132 Q 10 A 12 133 Q 13 A 14 134 Q I got an appointment with It was a friend of mine, a fellow called -- he was a Hanley was his name. Yes ? Noel Hanley. Would you explain to me what was required in 15 relation to the bonds? 16 that you were required to enter into? 17 A 18 135 Q 19 A Was this a performance bond Yes, first you would have to put down a bid bond. Yes ? And when you -- then if you got the contract then you would have to get a performance bond. 20 21 So, I Who suggested Guinness & Mahon to you? vet. 11 You would have to 136 Q You would have to get a performance bond by which 22 you would undertake to carry our the contract, 23 is that it? 24 A 25 137 Q What role did the bankers play in assisting you in that connection? 26 27 A 28 138 Q 29 That is correct, yes. The banker would put the bond up for you. Yes. You would pay the bankers then for this service? 1 A. They would put it up. No, you wouldn't pay the 2 bankers. 3 was there and you would get back the bond. 4 139 Q. 5 A. Yes? But if you didn't get back the bond then you 7 140 Q. 8 A. 9 141 Q. Yes? 10 A. Yes. 11 142 Q. A. 14 Yes, yes. However, they would charge you for this service, Yes. They would charge you may be a half per cent or 1 %. 15 143 Q. 16 A. 17 144 Q. 18 A. 19 145 Q. Yes? Or something like that, yes. You went to see Mr. Traynor then? Yes. You saw him then in the Guinness & Mahon offices, I take it? 20 21 A. 22 146 Q. 23 Yes. Would this have been in the early 1970's, do you think? 24 A. 25 147 Q. 26 A. 27 29 They would come to you then looking for it? would they? 12 28 The bond were committed for payment. 6 13 They would put the bond up. Yes, the early 1970's. It was, yes. Yes? It might be. It could be though the mid 1970's. would say about 1975, yes. 148 Q. Now...(INTERJECTION)? I 1 149 Q You got assistance from him in the ordinary banking 2 requirements. 3 strength of Letters of Credit? 4 A 5 150 Q 6 A 7 151 Q 8 A 9 152 Q You got loans from him on the Yes, yes. And the bank entered into bonds on your behalf? Correct, yes. You did business with them in the ordinary way? Yes . However, at some stage Mr. Purcell a question arose 10 about transferring funds to the Cayman Islands. 11 Would you tell me about that? 12 A Yes. In 1981 I asked Mr. Traynor -- I said I wanted 13 to get a dollar account because I would have to have 14 a dollar account. 15 Ireland," 16 I will have a look at it and I will arrange one 17 outside the Country for you." 18 153 Q 19 A He said, "It is not possible in but he said, "I will arrange one abroad. Yes ? "Because," I said at the time, "I need to send dollars out on commissions". 20 21 154 Q 22 A Sorry? I said, "I need to send dollars out on commission," 23 like commissions. 24 time, in Egypt and those places, you had to have 25 an agent. 26 155 Q 27 A 28 156 Q 29 A Like in those countries at the Yes? And that agent would get maybe 2% or 3% commission. Yes? 1 157 Q 2 A 3 So, you had to have dollars to be able to pay those commissions. 4 158 Q 5 A Yes ? But I had a bad experience in 1981 because I wanted 6 $1.1 million to go out to Egypt. How I remember 7 that so well is that I went to Mr. Traynor and asked 8 him and he said, "Leave it with me." 9 on for about a fortnight or three weeks and I This was going 10 couldn't -- I would ring him up an he wouldn't be 11 there. 12 to have it," I said, "because I wouldn't get my 13 money. 14 Credit." 15 Credit at the time and they were confirming it. 16 Eventually I got it, the $1.1 million but it held me 17 up for -- because President Sadat was shot and it 18 held me up again for about a month after, where I 19 was looking for him to get my $5 million. 20 159 Q 21 A I went back to him again and I said, "I have I wouldn't get paid on that Letter of Hugh Baff[sic] was phoning the Letter of Yes? So, that is what happened then. Then he came in 22 1982 and he said to me, "If you get me some dollars, 23 send me some dollars," he said, "I can open a dollar 24 account for you". 25 160 Q 26 A Yes ? I went to him again in 1982. He didn't come to me. 27 I went to him and I said, "I have no dollars but I 28 might have some dollars," 29 the Canary Islands. but I was owed dollars in 1 161 Q. 2 A. Yes? Because I was shipping cattle to the Canary Islands. 3 I was owed that for a couple of years and I got that 4 money, I got it, eventually and I gave it to 5 Mr. Traynor. 6 162 Q. 7 A. And he said, "Okay. I will open a dollar account for you". 8 9 Yes? 163 Q. Yes. Mr. Purcell, this was all still in your own name, was it? 10 11 A. 12 164 Q. 13 A. 14 165 Q. 15 This was all in Seamus Purcell's name. It was business carried on in your own name? Yes. This was money that you were owed from the Canary Islands? 16 A. 17 166 Q. Yes. It was transferred then to the Cayman Islands. 18 Did Mr. Traynor explain to you about the 19 Guinness Mahon Cayman Trust Company? 20 A. 21 167 Q. 23 A. 24 168 Q. 25 29 I am Could you explain that? Did Mr. Traynor explain to you? Yes. Where it was going to in the Cayman Islands and about the Guinness Mahon Cayman Trust Company? A. 27 28 Mr. Costello would you say that again? sorry. 22 26 No. No, he did not Mr. Inspector. Mr. Traynor said, "I will open a dollar account for you". 169 Q. Yes? 1 170 Q Yes. Did he say where he was opening the dollar account? 2 3 A 4 171 Q 5 A 6 172 Q 7 A 8 173 Q 9 He didn't say. However, it was outside? Outside Ireland. Other than that he never said. He said he would open a dollar account for you? Yes . Did you know that Guinness & Mahon Ireland had a subsidiary in the Cayman Islands? 10 A 11 174 Q 12 A No. When did you learn that? I learnt that later on, may be after -- I didn't 13 learn a lot of things about that dollar account 14 until I got -- from the -- we got -- I think I got 15 it from Guinness & Mahon. 16 175 Q 17 A 18 176 Q Yes ? 19 A Yes . 20 177 Q Yes ? From when the enquiry came up. However, before that did you know that 21 Guinness & Mahon had a subsidiary company in 22 the Cayman Islands? 23 A Well, I would be saying wrong if I did. 24 answer you whether I did or not now. 25 did. 26 178 Q 27 A 28 179 Q 29 I can't I can't say I I can't say I didn't. Yes? I don't know to be quite honest with you. Mr. Traynor did not tell you that he had put the dollar account -- he put it out of Ireland? 1 2 180 Q. 3 A. 4 He didn't tell me. didn't tell me. 5 181 Q. 6 A. 7 8 However, he did not tell you where? 9 He could have told me. Yes? But I don't know. to that. 182 Q. To the best of my knowledge he I can't say yes or I can't say no I don't know. What there was was a transfer of funds from the Canary Islands, funds that you personally were owed and were paid? 10 11 A. 12 183 Q. 13 A. Correct, yes, for cattle. For cattle? Yes, and I will tell you, which is going to be very 14 had to believe, the company that paid me that draft, 15 the banker that gave out that draft, he shouldn't 16 have given it out because the company didn't have 17 the funds to meet it. 18 184 Q. 19 A. 20 185 Q. 21 A. 22 186 Q. 23 A. 24 187 Q. 25 Yes? And that is it. Yes? And I was very lucky to ever get that. Very well. Yes. Approximately what are we talking about? talking about...(INTERJECTION)? 26 A. $450,000. 27 188 Q. $450,000? 28 A. 29 189 Q. Yes. You think this was in 1982? Are we 1 2 190 Q 3 4 Thereafter, did you give Mr. Traynor dollars to top up the account? A No. This is what I can't understand. When that 5 dollar account was open, the first dollar payment I 6 was able to get from that account would be $100 ,00 0 7 to one person outside. 8 $100,000 they said no, we will give it from Guinness 9 & Mahon, so they gave the $100,000. When I asked for that There was 10 another one of $30,000 and there was another one of 11 $50,000. 12 at that time. 13 there, I can't go back but I can remember a good 14 few 15 That was all paid out by Guinness & Mahon There was maybe $100,000 here and . 191 Q 16 Did Mr. Traynor not explain to you what he was doing? 17 A 18 192 Q No, he did not. Did he not explain to you that there were sums 19 lodged in Guinness & Mahon in Ireland, that there 20 was a lodgement here of money on deposit and that 21 you could use it? 22 A As far as I was concerned that cheque I gave him 23 went outside the country and an account was opened 24 abroad, that is as far as I was concerned, nothing 25 else. 26 everyday or ring up everyday like that. 27 he was a great help to my business although he sold 28 me a company that I had to let go bankrupt. 29 Mr. Traynor was a man you could not approach At the time 1 2 3 4 5 194 Q. Yes. A. 195 Q. Yes. A. 196 Q. 9 A. 10 197 Q. Yes. He told you the payments were going to be made in Dublin? 11 A. 13 14 Mr. Purcell, just to come back to the transactions when you were looking for dollars to make payments. 8 12 Maybe he thought it was okay, but the books weren't okay. 6 7 The pet food company. Yes, he said, 'yes, it is okay, we'll pay.' will be what you want. 198 Q. 15 That That is all. He said, 'what did you want' and you told him. What did you want dollars for? 16 A. 17 199 Q. 18 A. I wanted dollars to pay commissions. Commissions? At that time when I had a problem with Department of 19 Agriculture I shipped 317,000 cattle in 15 months 20 and there were commissions to be paid on all those 21 cattle, every one of them. 22 to the Egyptians on all those cattle. 23 dispute with one because they were charging me the 24 commission on the rates in Ireland and I should only 25 pay commission on the rates in Egypt. 26 200 Q. I had commissions to pay I had a I am not following, Mr. Purcell, why you could not 27 pay these commissions in the ordinary way from a 28 dollar account in Ireland, why you had to go abroad? 29 A. It was illegal. It wasn't legal to have a dollar 1 2 201 Q 3 A 4 202 Q 5 A 6 203 Q 7 A Who told you that it was illegal? The bank told me that. What bank? Guinness & Mahon told me. That it was...(INTERJECTION)? Mr. Traynor told me that it wasn't legal to have a 8 dollar account in Ireland in those days and I am 9 certain that is correct because I checked that with other banks too. 10 11 204 Q The illegality then was attached to having a dollar 12 account, was this in respect of payment of dollars, 13 the payment abroad of dollars that you had received 14 abroad, is that what he was telling you was illegal? 15 A No, you could not have a dollar account in Ireland, 16 you could not hold a dollar account in Ireland. 17 Mr. Inspector, if you go back and check that, I am 18 certain that is so as I had asked many banks at the 19 time . 20 205 Q 21 A 22 Did you know about exchange control regulations? Yes, I did, but I left all that to my bankers. My bankers looked after all that, yes. 23 206 Q 24 A 25 207 Q You knew there was exchange control? Yes . You knew that if you got foreign currency as a 26 result of your exports, you then would have to give 27 it to the Central Bank? 28 29 A I am sure it is was all looked after, everything was looked after like that. 1 208 Q. Similarly, if you wanted to buy goods abroad with 2 foreign currency, you could apply to the Central 3 Bank for permission? 4 A. Yes, but I didn't want to buy goods. If I was 5 buying abroad, I would have my letters of credit to 6 go abroad, to Australia and other places. 7 wouldn't be coming to Ireland for that. 8 209 Q. 9 Was there any reason that these commissions were secret commissions? 11 A. Some of them, yes. 12 210 Q. Some of them, yes? 13 A. 14 211 Q. 15 Yes. So these were secret commissions which would have to be paid independently of the contract? 16 A. 17 212 Q. 18 Correct, yes. Was this a factor in using the foreign account for making these payments? A. No, it wasn't a factor. It was a factor that you had to use the dollars when you needed them. 20 21 Was that a factor in the situation? 10 19 I 213 Q. 22 So this was a way of obtaining dollars when you needed them? 23 A. 24 214 Q. 25 Yes. These were dollars which you had obtained as a result of exports to the Canary Islands? 26 A. 27 215 Q. Correct. Were you advised in any way whether or not there was 28 any breach on your behalf of the exchange control 29 regulations by what you were doing? 1 2 216 Q. 3 A. 4 217 Q. 5 You were not advised? No. When you went to make the payments, you were then told that the payments could be made from Dublin? 6 A. 7 218 Q. 8 A. 9 Yes, and they were made from Dublin. How do you know they were made from Dublin? Because I went down to the bank myself and got a draft for $1 0 0 ,0 0 0 . I went down and got cash for 10 $30,000 and I went down and got cash for maybe 11 $50,000 and I handled all those myself. 12 219 Q. 13 A. 14 220 Q. 15 A. 16 221 Q. 17 A. 18 222 Q. 19 A. 20 223 Q. 21 A. 22 224 Q. 23 Sorry, when you say $50,000, are these US dollars? Yes. So you got US$50,000 into your hand? Yes, from the bank. From the bank? Yes. What did you do with them? I gave it to the man that was with me. He was the person who was to get the commission? Yes. This was a payment of commission. Was he an egyptian person or was he an Irish citizen? 24 A. 25 225 Q. 26 A. 27 226 Q. 28 A. 29 227 Q. He wasn't an Irish citizen. Very well. He was from the Middle East. From the Middle East? Yes. He was entitled to commission from you? 1 2 228 Q 3 A 4 Yes. Some of them would take drafts and some of them would want cash. 5 229 Q 6 A 7 230 Q 8 These were in US dollars? Yes . That was your first transaction in relation to payment of commission, were there later ones? 9 A 10 231 Q 11 A 12 Yes, there were, yes, a lot of later ones. Did they always take place in the same way? They did, yes, always took place mostly or you got a bank draft, mostly drafts now. 13 232 Q 14 A 15 233 Q 16 A That would be a bank draft? Yes . Payable by Guinness Mahon Ireland in US dollars? Yes. Then we would pay some of them maybe from 17 Australia when we had contracts for Australia and we 18 would be working in Australia, we would pay some of 19 those commissions from there. 20 234 Q So that instead of the sterling fund, the Australian 21 dollars coming back to Ireland, part of them would 22 be channelled off in to the payment of commission? 23 A 24 Correct, yes, but we would have letters of credit open to Australia. 25 235 Q 26 A 27 Sorry? We would have the letters of credit open to a bank in Australia. 28 236 Q 29 A You would go into the bank and get these drafts? 1 237 Q. su ffic ie n t? 2 3 A. 4 238 Q. A. 8 239 Q. 9 A. I was d e a lin g w ith a chap c a l l e d B arry McLoughlin i n What about Mr. Traynor, were you d e a li n g w ith him? Yes, a n y th in g I wanted, a loan o r a n y th in g l i k e t h a t , I would have to ask Mr. Traynor. 10 240 Q. What about when you wanted to g e t payment t o pay th e commission, would you go t o . . . ( INTERJECTION)? 12 13 Who were you d e a lin g w ith in Guinness & Mahon when th o s e days. 7 11 Both i n cash and in d r a f t s , yes. you went in? 5 6 L a te r d id you d e al in cash or were d r a f t s A. I would r i n g Barry McLoughlin and he would ask Mr. Traynor. 14 15 241 Q. 16 A. 17 242 Q. He would ask Mr. Traynor? Yes. How d id th e funds which were used f o r th e payment of 18 commission, how were th e y topped up i n th e c o u rse of 19 th e y e a rs? 20 A. 21 243 Q. I mean d id th e US$450,000 t h a t you got i n i t i a l l y , d id t h a t do f o r a l l th e p e rio d ? 22 23 How do you mean? A. 24 No, i t d i d n ' t . I owed about $1.5 m i l l i o n a t th e tim e i n commissions. 25 244 Q. 26 A. 27 Yes, t h a t i s what I would have th o u g h t. Yes, about $1.5 m i l l i o n commission and Mr. Traynor prom ised me t h a t he would look a f t e r i t . 28 245 Q. 29 A. What d id he mean by t h a t ? He would look a f t e r i t . He s a i d to me, "How much 1 dollars?" 2 open an account abroad for you". 3 246 Q 4 A 5 He said, "Get me dollars first, I will Yes . They were the only dollars I could put my hands on at the time. 6 247 Q 7 A Yes . I said, "But I need about $1.5 million," and he 8 said, "Well, I will look after that. 9 I'll look after that". 10 248 Q That is okay. Did you understand from that that he would be able 11 to put into the fund that he was putting abroad 12 US dollars? 13 A When I asked him, Mr. Costello, to put the 14 $1.5 million, 15 got that in 1982 on the second of it, I think in 16 February 1982 when I gave him that draft, the other 17 money that he said he would put in never came in 18 until six months after and I can't understand this. 19 249 Q 20 I was amazed to see on a statement I You are talking, Mr. Purcell, about a statement you obtained of the foreign account? 21 A 22 250 Q Correct. You are saying that a $1.5 million came in, but not 23 when you expected it, it came in about six months 24 later? 25 A 26 251 Q 27 That is correct. Mr. Traynor said he would do this for you and he did it, but he did it late; is that correct? 28 A 29 252 Q That is correct, yes. Do you know where Mr. Traynor got the money to put 34 1 2 A. 3 4 I don't know, I just don't know and I can't understand the amount of money. 253 Q. Wherever he got it from, this foreign account which 5 you now know is in the Cayman Islands, Mr. Purcell, 6 is that right? 7 A. 8 254 Q. 9 A. 10 255 Q. 11 A. Yes. Was increased by US$1.5 million? Yes. Six months later? Yes, I knew that, yes. I know that, but I always 12 thought that it was increased by $1.5 million 13 immediately. 14 256 Q. 15 A. 16 257 Q. Yes, I see. That is what I thought. Mr. Traynor was not using his own money to put into 17 your account, would I be correct in assuming that he 18 obtained the US dollars from the trading which you 19 were carrying on and the payments which were 20 obtained for the trading? 21 A. Yes. At that time that Mr. Traynor gave me any 22 loans, it would be against assets and letters of 23 credit. 24 Mr. Traynor had. 25 258 Q. 26 I am just asking you about the transfer of US$1.5 to your Cayman account, Mr. Purcell. 27 A. 28 259 Q. 29 So whatever assets that I had at the time, Yes. Am I correct in saying that that must have come from 1 2 As far as I can understand that $1.5 million, 3 borrowing $1 million and putting down $450,000 to 4 pay the commissions. 5 260 Q 6 A 7 261 Q 8 A 9 262 Q 10 A 11 263 Q 12 A 13 Yes . That is where I came up with the $1.5 million. You think it was money that was lent? Yes, certainly. You think he lent you money? Yes . On the strength of the $450,000 that you had? Yes, yes. He told me at the beginning that I would have to have dollars, give him dollars. 14 264 Q 15 A Yes . To open an account and I gave him the dollars, and I 16 told him I wanted $1.5 million. 17 want the problem coming up again because those 18 commissions will have to be paid.' 19 'alright, I'll look after that for you.' 20 I was 265 Q I said, 'I don't He said, I just want you to explain to us where Mr. Traynor 21 got the $1.5 million from that he put into the 22 Cayman account and you are now telling me that you 23 think he lent it to you? 24 A There is no thinking at all about it, I am sure he 25 lent it. 26 He lent it to you? 27 Yes . 28 29 1 know, but he assumes and the rest of this is 2 speculation. 3 Yes. 4 would have to have $1.5 million. 5 267 Q I asked him for $1.5 million and I said I MR. JUSTICE COSTELLO: 6 You referred to the fact that you did not realize 7 that the money was not put in until you had seen the 8 statement, is that the statement that you got 9 recently from Guinness & Mahon in the last few 10 years ? 11 A 12 268 Q Yes, it is. Yes, that is the statement. This was money that you needed to pay commissions in 13 1982. 14 very large export business and commission was 15 payable. 16 made for putting further money into this off-shore 17 account in the Cayman Islands? 18 A In the following years you continued on your I am just wondering what arrangements were As far as I was concerned I was covered like with 19 dollars to pay commissions. 20 dollar account I don't know what -- I know what 21 happened to it because I see it there on the thing, 22 but it was Guinness Mahon's, that money was Guinness 23 Mahon's, that is that it was. 24 269 Q 25 A 26 270 Q Anything with the It was Guinness Mahon's but you could use it? Yes . You could go along and you did go along over the 27 years and pay very substantial sums by way of 28 commission, is that right? 29 A 1 Per annum what would you have been paying to 2 Guinness & Mahon and paying out from Guinness & 3 Mahon commission? 4 year or $5 million a year or what would it have 5 been? 6 A 7 272 Q 8 A 9 Would it have been $1 million a I am not quite sure. Approximately? It is a very difficult question to answer at this time because I would have to look at the sums and 10 the monies and everything else coming out and take a 11 percentage off it. 12 answer on that. 13 273 Q 14 A 15 274 Q I couldn't give you a straight I am sure that is so, it is a long time ago as well. Yes . Mr. Purcell, I just want to get a couple of things 16 clear. 17 1980's and in the 1990's? 18 A 19 275 Q 20 Firstly, you were exporting during the Yes . Secondly, you had to pay these secret commissions during this period? 21 A 22 276 Q Yes . Thirdly, you got the money for the secret 23 commissions by going to Guinness & Mahon in Dublin, 24 is that correct? 25 MR. BARRY: 26 27 28 29 Some of them were secret, not all of them. MR. JUSTICE COSTELLO: Sorry, the witness is giving the evidence. there is a legal point you wish to raise, please If 1 2 3 evidence has been given 4 and I wish to make sure that it is correct. 5 MR. JUSTICE COSTELLO: 6 If you want it corrected, it can be corrected later. 7 If there is a legal point, you raise it with me. 8 your solicitor points out, some were secret 9 commissions and some were not? 10 A 11 Now, the commissions could be paid from Australia, they could be paid from Germany. 12 278 Q 13 A 14 15 Yes. As Yes . And they could be paid from Ireland and I couldn't tell you actually the amount. 279 Q 16 Just the ones that were paid from Ireland is what I am concerned about at the moment. 17 A 18 280 Q Yes . The commissions that were paid from Ireland were 19 paid as a result of you going into Guinness & Mahon 20 and ringing u p ...(INTERJECTION)? 21 A 22 281 Q 23 24 You would have got a bank draft or sometimes you would have got cash? A 25 Yes, that's right, and I could not tell you how much it was. 26 282 Q 27 A 28 283 Q 29 Yes, certainly, that is correct. You cannot tell me how much it was? No, I cannot, it is not possible for me. Am I correct in saying that the arrangement which you had opened originally with Mr. Traynor stood and 1 it was from the off-shore account that these 2 commissions were paid? 3 Yes, it was from the off-shore account that those 4 commissions were paid. 5 284 Q You do not know how he transferred money to that 6 off-shore account to enable him to give it to you in 7 Dublin? 8 A 9 285 Q 10 No, I do not. However he did it, you were able to get the money in Dublin? 11 A 12 286 Q That is correct, that is correct. Mr. Purcell perhaps we might have a break now if 13 that would be alright? 14 cup of coffee or a cup of tea. 15 we will be back in about ten minutes or so. 16 A We will have a break for a If you stay here and Thank you very much. 17 18 SHORT ADJOURNMENT 19 20 287 Q MR. JUSTICE COSTELLO: 21 We will resume our interview, Mr. Purcell. 22 Just to clarify what I was talking about before we 23 adjourned, in the years after 1982 you left the 24 problem of getting funds for the off-shore account 25 to Mr. Traynor? 26 A Yes . 27 As far as you know in the years and after 1982 28 Mr. Traynor transferred funds to the off-shore 29 account? 1 2 289 Q 3 A 4 290 Q 5 A 6 7 But thereafter? No, it was six months after I think, was it? Yes . Yes. I didn't know that. I didn't know that until I saw that statement. 291 Q I just want to get it clear, Mr. Purcell, what 8 happened in the subsequent years. 9 Mr. Traynor and got commissions for the agents in 10 You went to Egypt or wherever? 11 A 12 292 Q 13 A 14 Yes, I got different commissions. You got different commissions? Yes. I was shipping a lot out of Australia at that time, sheep. 15 293 Q 16 A Yes . I also got commissions from Australia. Also when I 17 did my barter deal with the $155 million barter 18 deal, I couldn't get any bank, only I was lucky to 19 get a bank in Germany to look after it and that was 20 all in dollars too. 21 of that. 22 294 Q The commissions were paid out What I want to ask you about, Mr. Purcell, is how 23 did the off-shore account get increased by the 24 amount of dollars that you needed to pay the 25 commissions? 26 A 27 When I asked for the account I said I wanted $1.5 million. 28 295 Q 29 A Yes . When I gave him the $0.5 million, I was only of the 41 1 impression that he was putting that millon dollars 2 in. 3 296 Q 4 A 5 Yes, when it began, but he didn't put it in and I never knew that. 6 297 Q 7 A 8 298 Q 9 A 10 299 Q 11 A 12 300 Q 13 14 You were talking about 1982 when it began. I want you to talk about later years. The later years? Yes . On the commissions? Yes . Later on in the year? No, in late 1983, 1984 and 1985, what happened in those years? A In those years, you see, all the contracts were not 15 commissioned. 16 you had to have an agent, you didn't have to have an 17 agent in the other countries that you were dealing 18 with. 19 $20, 000 there to some of the people that would help 20 you inside in the company. 21 301 Q 22 23 A 302 Q Yes, you had to pay commissions, I'm even paying Would you get the commissions by going into Guinness & Mahon? A No, I would get the commissions for whatever bank I would be dealing with. 28 29 Did you have to pay commissions in the following commissions up to today. 26 27 Therefore, you give $100,000 here and years ? 24 25 It is only compulsory in Egypt that 303 Q I am just wondering, this arrangement that you 42 1 2 Yes . 3 304 Q 4 A 5 No, it didn't. The commissions always stayed on there. 6 305 Q 7 A 8 306 Q 9 A 10 307 Q 11 12 Did that finish in 1982, that arrangement? The off-shore...(INTERJECTION)? Yes, that finished as far as I was concerned. Yes? Yes . You have seen the documents that were forwarded to you by Guinness & Mahon, is that right? A I did, yes. 13 MR. BARRY: 14 documents that were with the statement? 15 MR. JUSTICE COSTELLO: Yes. 16 M R . BARRY: Yes . 17 A 18 308 Q Are we referring to the Yes, yes. MR. JUSTICE COSTELLO: 19 You have seen the documents that they 20 forwarded to you? 21 A 22 309 Q Yes, yes. Am I correct in understanding that you agree that 23 Seattle Securities Limited must have been a company 24 that was formed in the Cayman Islands, which held 25 funds to which you were entitled? 26 A 27 310 Q 28 A 29 311 Q I never knew anything about Seattle Securities. Yes? And I never saw anything about Seattle Securities. Yes? 1 And I just can't understand Seattle Securities and 2 "Ansbacher". 3 312 Q 4 A 5 313 Q I can't understand this at all. I know you say that? Yes . However, looking at it now do you agree that it 6 would appear that these were your funds in the name 7 of that company? 8 A 9 dollars. 10 314 Q 11 A 12 Yes ? And I knew that commissions would have to be paid against those dollars. 13 315 Q 14 A 15 16 I left it to Mr. Traynor when I gave him those Yes? And as far as I was concerned so long as I got the commissions to pay that was it. 316 Q However, Mr. Purcell, I am just wondering are you 17 agreeing with me or disagreeing with me that the 18 account in the name of Seattle Securities Limited? 19 A 20 317 Q Yes, yes. Which now appear from the documents that you have 21 obtained is an account in the name of a company 22 which are your funds? 23 A 24 Yes, but I had nothing -- no Seattle Securities as far as I am concerned. 25 318 Q 26 A 27 Yes ? They were there, I see it on the statement, but I knew nothing about Seattle Securities. 28 319 Q 29 A I understand what you are saying to me? 1 320 Q 2 A 3 321 Q Yes . You said "yes". You are agreeing that they are your 4 funds but you knew nothing about them, is that what 5 you are saying? 6 A 7 322 Q 8 9 I knew nothing about Seattle Securities. However, are you agreeing they are your...(INTERJECTION)? A 10 I knew about the funds, the money, I gave on the cheque from Portugal. 11 323 Q 12 A 13 324 Q Yes. We will come to that in a moment? Yes, yes. Are you agreeing with me that the funds that were in 14 the account in the name of Seattle Securities were 15 your funds? 16 A I can't agree with you because I don't -- I know now 17 they are my funds but I couldn't agree with you at 18 the time. 19 325 Q 20 A 21 326 Q 22 A 23 327 Q 24 A 25 328 Q 26 A 27 329 Q At the time? No. Exactly. I understand that? Yes . You know now that they were your funds? Yes, I know now, yes. You did not know anything about Seattle Securities ? No, no. Nothing at all about it, no. You have seen the documents too that there was an 28 account in Guinness & Mahon in Dublin in the name of 29 Guinness Mahon Cayman Trust with the code "Y" after 2 Yes . 3 330 Q 4 A 5 331 Q 6 A 7 332 Q 8 A 9 333 Q 10 11 Or under it? Yes . You have seen those documents? I have seen that "Y", yes. You knew nothing about that account at the time? Nothing whatsoever about it. Do you accept now Mr. Purcell that they were your funds ? A Well, "Y", it is down on the statement that I have 12 it. 13 supposed to have "Y". 14 334 Q 15 A 16 335 Q 17 A 336 Q 20 21 Which I knew nothing at all about. Yes? Or never even heard it or never heard the name Yes. . I am just wondering do you accept now that they are your funds? A 22 Well, as far as I am concerned they were Guinness & Mahon's funds. 23 337 Q 24 A 25 338 Q 26 27 I am Yes ? of "Y" 18 19 I am supposed to have Seattle Securities. Yes? Because Guinness & Mahon had them. They had them. Do you not accept then that the account...(INTERJECTION)? A I don't accept it because -- for the simple reason 28 is that the money that Guinness & Mahon had there, 29 whatever they were doing with it and whatever they 1 were not doing with it, I owed it to them. 2 were giving me -- they were offsetting me. 3 339 Q. 4 A. 5 340 Q. 6 They Yes ? And that is what I can read from the accounts. We will just refer then to this Madrid cheque to which you have referred? 7 A. 8 341 Q. 9 A. 10 342 Q. 11 Canary Islands. Page 45 please (Same Handed) (Exhibit 1)? Thank you. You will see that is a Banco Intercontinental Espanol - Madrid? 12 A. 13 343 Q. 14 Yes . Spanish Intercontinental Bank - Madrid and it is payable to you personally? 15 A. 16 344 Q. 17 A. 18 345 Q. 19 A. 20 346 Q. Yes . It is for a sum of US$432,438.24? Yes . You see that? Yes . I think somebody had written on that: 21 22 "File Seattle Securities"? 23 24 A. Yes . 25 I take it that you have seen what happened to that 26 cheque at page 56. 27 ledger. 28 29 If you would just look at the It our 56 (Same Handed) (Exhibit 2). 1 2 Guinness Mahon Cayman 3 Trust and then the "Y" 4 the left-hand side, the top left-hand side. 5 see that Mr. Purcell? 6 A. 7 34 9 Q. 8 A. 10 350 Q. 11 A. 12 351 Q. 13 A. 14 352 Q. 15 A. 16 353 Q. 17 Do you "Y". Do you see Guinness Mahon Cayman Trust? Do you see Yes, I do, yes. You see after Limited the letter "Y"? Yes, I see that, yes. You see that? Sorry, I see that now, yes. That is an account in Guinness & Mahon in Dublin? Yes. The account's name is Guinness Mahon Cayman Trust and there is a "Y" after it? 18 A. 19 354 Q. 20 Yes. Then there is the currency. It is a US dollar account? 21 A. 22 355 Q. 23 Yes. The date is on the left-hand side of the page. is the 20th May 1982? 24 A. 25 356 Q. 26 A. 27 357 Q. 29 It is there on that typed on the top left-hand side? 9 28 after it? Yes. Do you see that? Yes. Do you see the first credit that is lodged $432,438.24? It 1 358 Q 2 It is not a reasonable assumption that was the cheque payable to you? 3 A 4 359 Q Correct. Your money was lodged into the Guinness Mahon Cayman 5 Trust Limited account in Guinness & Mahon with the 6 code "Y" after it? 7 A 8 360 Q 9 A 10 361 Q I see that now, yes. You did not know at the time? No way. I did not know anything about "Y". It is a long time ago Mr. Purcell. 11 considerable amount of money. 12 getting a cheque for $432,438? 13 A 14 362 Q 15 A 16 However, it is a Can you remember Yes . You can remember it, can you? I remember it just the very same as it happened yesterday. 17 363 Q 18 A 19 364 Q 20 A 21 365 Q 22 A 23 3 66 Q 24 A 25 367 Q 26 A 27 368 Q 28 A 29 369 Q Tell me what you did with the cheque? I gave it to Mr. Traynor. You gave it to Mr. Traynor? Yes . I see. What was it for? It was for to pay commissions. Yes ? And to open a dollar account. Yes. Where had that money come from? It came from the Canary Islands. The Canary Islands? Yes . This was US dollars. 49 You gave him the cheque. This 1 was the beginning, was it, of the off-shore 2 arrangement that you had made with Mr. Traynor? 3 A. 4 370 Q. 5 A. 6 371 Q. It was, yes. Yes? Yes. There was a balance brought forward, if you look on 7 the right-hand side, so you had, obviously, put 8 earlier funds in this account? 9 10 A. 37 2 Q . 11 A. 12 373 Q. 13 A. 14 37 4 Q. I put no earlier funds in this account. Yes. Definitely not. However, any way the...(INTERJECTION)? I put no earlier funds in. Does it not appear that the money that you gave to 15 Mr. Traynor, your money, was credited to the 16 Guinness Mahon Cayman Trust Limited account 17 coded "Y"? 18 A. 19 I don't know nothing about that that. Nothing at all about i t . 20 375 Q. 21 A. 22 376 Q. 23 A. 24 377 Q. 25 A. 26 I know you know nothing about it? No. Is that not a ...(INTERJECTION)? Well, I trusted Mr. Traynor. Yes? Because Mr. Traynor -- if I hadn't Mr. Traynor at the time I couldn't do the business I was doing. 27 378 Q. 28 A. 29 379 Q. Yes? No way. Yes? 1 But could I do the business and I trusted 2 Mr. Traynor with everything and as far as I was 3 concerned he was the best banker I ever met in 4 my life. 5 Yes. 6 can you see any other explanation for the transfer, 7 to which I have referred, other than your cheque 8 went into that account? 9 A 10 381 Q 11 A 12 I know you left it to Mr. Traynor. However, Yes, I can't see any other explanation. Any explanation? I can't. I am sorry that I can't help you with anything. 13 382 Q 14 A 15 383 Q 16 A 17 384 Q Yes? I just don't know. You left it to Mr. Traynor? Yes, yes. Yes. I just don't know. I am just wondering about the use of the 18 off-shore account that was then in existence. 19 you know that that remained in existence, that 20 off-shore account? 21 A 22 After about 1982, 1983 or 1984 I had forgotten altogether about that account. 23 385 Q 24 A Yes ? I had forgotten because Mr. Costello I was away 25 most of the time. 26 nine months a year out of Ireland. 27 386 Q 28 A 29 387 Q I was, I would say, eight or Yes? And I had forgotten completely about that. Yes? Did 1 A. And at that time I was away all the time. I was in 2 -- I spent seven months/six months in Libya and 3 about three months in Australia in those years. 4 388 Q. 5 6 Yes. When you returned would you get any statement of account from Mr. Traynor? A. I did the working part Mr. Costello. 7 the time. 8 accounts. 9 389 Q. 10 A. 11 390 Q. 12 A. I worked all I never bothered much looking at Yes? Or anything else. Yes? But in the days when I am telling you about, that I 13 would go to Guinness & Mahon myself in 1982, I 14 didn't want anybody else knowing about those 15 people being given commissions. 16 391 Q. 17 A. 18 392 Q. 19 A. 20 393 Q. 21 A. 22 394 Q. Yes? If you understand me? So you...(INTERJECTION)? That is why I did it myself. You did it yourself? Yes. I take it you did not tell your own accountant that 23 you were opening this, that Mr. Traynor was opening 24 this account? 25 A. 26 You did not tell your accountant? At the time I would say I did because I would say he knew at that time that we needed a dollar account. 27 395 Q. 28 A. 29 396 Q. Is that your accountant, your personal accountant? That is ... (INTERJECTION) . Or your business accountant? 1 2 397 Q 3 A 4 398 Q Your business accountant? Yes . I would just like to refer you to another document. 5 It is tab 8 . 6 an internal document. 7 A 8 3 99 Q 9 A 10 400 Q 11 It is page 70 (Same handed). It is 1984 This is (Exhibit 3)? Yes . It is an authorization to open a deposit account? Yes . Do you see the account name: "GMCT" and then "Y" on the left-hand side? 12 A 13 401 Q Yes, yes. That is the account to which I referred you to 14 before, the bank statement in 1982. 15 that? 16 A 17 402 Q 18 A 19 403 Q 20 A 21 404 Q Do you see Yes . "GMCT"? Yes . And "Y"? Yes, yes. Do you see on the right-hand side: 22 "Back-to-back with GM loan," 23 24 do you see that? 25 A 26 405 Q 27 A 28 406 Q 29 A GM loan. It is hard to make out? Yes . However, that seems to be what is written there? 1 407 Q 2 A 3 408 Q 4 I see that, yes. You are very familiar with what a back-to-back loan is? 5 A 6 409 Q Yes, certainly. Would I be correct in saying that that appeared to 7 be that there was to be a lodgement, which was to be 8 used as a back to back loan, Deutschemark loan? 9 A 10 That seems to be the case here but I knew nothing about it. 11 410 Q 12 A 13 411 Q 14 A 15 412 Q 16 A 17 413 Q 18 A 19 414 Q 20 A 21 415 Q 22 I will come to that in a moment? Yes . Yes. You see the amount there at the end in pounds? Yes . It is £579...(INTERJECTION)? It is £5,7 97,090. It is £5 million, sorry. Yes? Yes . It is £5 million? Yes . Yes. There was to be a back to back loan. This was to be used, this lodgement was to be used? 23 A 24 416 Q 25 A 26 417 Q 27 A Yes . Is that not so? I am not -- I can't understand this at all. Yes? I can't. I am very very sorry but I can't give you an answer on it. 28 29 Yes, it did. 418 Q Yes? 1 2 419 Q. 3 A. 4 420 Q. 5 A. 6 421 Q. Do you see page 143 (Same Handed) (Exhibit 4)? Thank you. Do you see that this is Purcell Exports Ltd? Yes. It is: 7 "14 Clyde Road, Ballsbridge"? 8 9 A. 10 422 Q. 11 Do you see that it is for Deutschemarks, DM 6 ,000,000? 12 A. 13 423 Q. 14 A. 15 424 Q. 16 A. 17 425 Q. 18 A. 19 426 Q. 20 A. 21 427 Q. 22 A. 23 428 Q. 24 A. 25 Yes. The review date is the 3rd August 1984? Yes. Do you recall that at all? No. You do not? This is a mystery to me altogether. Sorry? It is a mystery to me, this is. It is a mystery? Because I wasn't dealing in Deutschemarks. Sorry? I was not dealing in Deutschemarks at the time with any contracts. 26 429 Q. 27 A. 28 430 Q. 29 Yes. Yes? All my contracts were in dollars. Yes? 1 431 Q. 2 Yes. I take it that you have had a look at this Mr. Purcell 3 A. 4 432 Q. 5 A. 6 433 Q. (Exhibit 4)? Yes, I saw this. Since you got them? Yes. Would you agree with me that it looks as if this 7 account, the Cayman Islands account that was coded 8 "Y", a deposit was made in the name of that company 9 or $5 million, was used as a back-to-back loan to 10 your company Purcell Exports Ltd? 11 A. 12 434 Q. 13 A. 14 435 Q. 15 A. 16 I couldn't tell you what they were doing with this. Yes? I haven't a clue. Yes? I couldn't give you an answer one way or the other on i t . 17 436 Q. 18 A. 19 437 Q. 20 Yes? I am very sorry but I can't. I can understand Mr. Purcell that you might not have been there? 21 A. 22 438 Q. 23 A. Yes. You might not have been in the Country at this time? Yes, but that is beside the point. 24 Deutschemarks? 25 Deutschemarks ? 26 439 Q. 27 A. 28 440 Q. 29 What would I be doing with Yes? I wasn't dealing with them. Yes? Why 1 441 Q. 2 A. 3 442 Q. 4 A. 5 443 Q. 6 A. 7 444 Q. 8 A. 9 445 Q. 10 A. However, be that as it may? Yes. Your company was Purcell Exports Ltd? Yes. 14 Clyde Road? Yes, that is correct, yes. It looks as if there was a loan of DM6,000,000? Yes. You cannot explain that? At that time Guinness & Mahon were only dealing with 11 the live business. 12 meat business. 13 that was dealing with the consortium with the meat 14 business. 15 446 Q. 16 A. 17 447 Q. 19 A. 20 Yes? And there was no meat or no live business in What was Purcell Exports dealing with? They were dealing with -- no, I am speaking for Purcell Exports too here. 448 Q. 22 23 It was the Ulster Investment Bank Deutschemarks whatsoever. 18 21 They weren't dealing with the Yes. They were dealing with live cattle, were they not? A. Yes, they were dealing with live cattle and meat. 24 They were -- Purcell Meats were dealing with the 25 meat. 26 449 Q. 27 A. 28 450 Q. 29 Yes? They were dealing with live cattle at the time. Yes. I am just wondering Mr. Purcell whether or not 1 2 3 No way. 451 Q 4 Nothing, no. Did Mr. Traynor ever suggest to you that you should have an off-shore account, other than before 1982? 5 A 6 452 Q He never suggested anything to me at all. Am I correct in saying that this was merely an 7 off-shore account that was opened, in the way you 8 have indicated, and that you never had any Trust 9 organised by Mr. Traynor? 10 A 11 453 Q No, never. I see. As the years past and you went to obtain 12 commissions in the way you have indicated to me, do 13 you remember Mr. Traynor leaving Guinness & Mahon? 14 A 15 454 Q 16 A 17 In 198 ... (INTERJECTION)? Yes, from 1984 or 1985 on I never had any -- I never met Mr. Traynor much after that. 18 455 Q 19 A 20 456 Q 21 After that? No. Did you ever visit him in Fitzwilliam Square, in his offices in Fitzwilliam Square? 22 A 23 457 Q 24 No, never, no. You continued to deal with Guinness & Mahon, did you, after 1984? 25 A 26 458 Q 27 A 28 459 Q 29 Yes, I do, yes. Yes, right up to about 1990 I think. Who did you deal with when you went there? When I started first? No, no. with? You told us it was Mr. Traynor you dealt 1 2 4 60 Q 3 A 4 There was different people then there. There was...(INTERJECTION). 5 461 Q 6 A 7 462 Q 8 A 9 463 Q 10 A 11 464 Q 12 A 13 465 Q 14 A 15 4 66 Q 16 17 Then you have now said that it...(INTERJECTION)? Who do you remember? Andy O'Donnell I remember. Yes? Mr. O'Donnell, Mr. Andy O'Donnell. Did you meet Mr. Collery? No, I don't know him. Did you meet Mr. Lanigan O'Keeffe? Yes, I did. Yes? Yes . Was Mr. Lanigan O'Keeffe looking after your business? A 18 He was, yes, some of the time and then Mr. O'Donnell took over from him. 19 467 Q 20 A 21 468 Q Yes? Yes . Because you, in fact, had a considerable amount of 22 business with Guinness & Mahon, apart altogether 23 from what we have been talking about? 24 A 25 4 69 Q 26 A 27 470 Q 28 29 Yes, I had. There were very large sums of money on loan? Yes . Then you ran into these financial hard times that you have described to us? A 1 471 Q Can you tell us when you finished, when you would 2 have ceased, having a backing arrangement with 3 Guinness & Mahon? 4 A 5 I am not quite sure. It must be around 1990 or something like that I would say. 6 472 Q 7 A 8 473 Q 9 A 10 474 Q 11 Did you cease altogether then? Yes . You think about 1990? I think so, yes. I think so. You would not have had any personal account there after that? 12 A 13 475 Q 14 No, I had nothing. I see. No personal account there. Your personal account would have been moved to another bank? 15 A 16 476 Q 17 A 18 I never had a personal account. Sorry? Myself, I never had one. For myself, my own self, I never had? 19 477 Q 20 A Sorry, I thought you told me that...(INTERJECTION)? I never had an account personally. It was always a 21 company account. 22 never kept one in Seamus Purcell himself, in my own 23 name . 24 478 Q Like I could write cheques. I misunderstood you. I Did you not have a personal 25 account in your own name in Guinness & Mahon in the 26 early days? 27 A 28 29 No, I didn't. I never had an account. It was Seamus Purcell & Company, whatever you call it. 479 Q 1 Yes, but that was it, Seamus Purcell. 2 personal account not to the best of my knowledge. 3 never had a personal account anywhere. 4 480 Q 5 A 6 481 Q 7 A 8 482 Q 9 I may have misunderstood you? Yes. I never had a personal account anywhere. What was the name of the company then? Seamus Purcell & Company, that is what it was. Was there a company different to Purcell Exports Ltd? 10 A 11 483 Q 12 Seamus Purcell was different to Purcell Exports. No. I will have to ask you to be a little bit more accurate? 13 A 14 484 Q 15 Yes . I thought that Purcell Exports Ltd was a company that was formed fairly late? 16 A 17 485 Q 18 Yes, it was. I thought you said that all your dealings were in your own name? 19 A 20 486 Q 21 A 22 Correct, yes. All...(INTERJECTION)? In Seamus Purcell & Company. it. 23 487 Q 24 A 25 488 Q 26 A 27 489 Q That was it. A That was the name of Seamus Purcell & Company. Sorry, then perhaps I am again misunderstanding? Yes . It was just Seamus Purcell & Company? That is correct. However, it was unincorporated. company, in fact? 28 29 I never had a It was not a I 1 2 A. 3 4 91 Q. 4 A. That is right, yes. Seamus Purcell & Company? That is right, yes, and that company -- the meat -­ 5 we flew meat everyday from Shannon in that company's 6 name for 1980 to 1985. 7 492 Q. 8 Yes. However, it was not a company. It was not an incorporated company? 9 A. 10 493 Q. 11 A. 12 494 Q. 13 A. 14 495 Q. No, it wasn't, no. It was just your name? That is all, yes, Seamus Purcell. It was a trading name that you used? A trading name, that is right. Did you, in fact, register it as a trading name do you know? 15 16 A. 17 496 Q. Yes, it would be registered. Yes. Whatever the name it was in, let us assume 18 your own personal account was in the name of Seamus 19 Purcell & C o ., in Guinness & Mahon? 20 A. 21 497 Q. 22 Mr. Purcell, did you cease having such an account in Guinness & Mahon around about 1990? 23 A. 24 498 Q. 25 A. 26 499 Q. 27 A. 28 29 Yes. I would say that ceased about 1985. A personal account? That Seamus Purcell & Company. Yes. Why was that? I never had a personal account in my life. I had only a working account, that is all. 500 Q. Yes. We may be disagreeing about the meaning of 1 2 3 501 Q. 4 A. 5 502 Q. You had an account on which you could draw cheques? Yes, for Seamus Purcell & Company. When you would want a cheque for your own personal 6 use you would draw it on Seamus Purcell & Company's 7 account? 8 A. 9 503 Q. 10 A. 11 504 Q. Account, yes. In Guinness & Mahon? Yes, certainly. What I want to know is this account in 12 Guinness & Mahon, Seamus Purcell & Company's 13 account, did it continue to the 1990's or did it 14 finish? 15 A. 16 505 Q. 17 A. No, it did not. It finished in 1985? About 1985. When the Libyan business was over, on 18 that meat contract, because that was in 19 Seamus Purcell & Company's name. 20 506 Q. 21 A. 22 23 Yes? When that was over, that was over in 1985, then that ceased. 507 Q. Yes. That personal account may have ceased. 24 However, your companies had very considerable 25 dealings still with Guinness & Mahon thereafter? 26 A. 27 508 Q. 28 A. 29 509 Q. Purcell Exports had. Purcell Exports? Yes, yes. It was the company which you then owned, 1 2 Yes, that is right, yes. 3 510 Q 4 A 5 511 Q 6 A 8 512 Q 9 Yes . Would you agree that the documents appear to the Cayman Islands? 11 A 12 513 Q That documents now tell me that. That is what you know now. However, you did not know then? 13 14 A 15 514 Q 16 No, they tell me now. Yes. Did you know that it was on deposit somewhere, the money was on deposit somewhere? A 18 As far as I was concerned the money was put out there to pay commissions. 19 515 Q 20 A 21 516 Q 22 A 23 Yes? In an account. Yes? And that was all because you could be calling for that money three days after, four days after. 517 Q 25 Yes. However, it would have been on deposit, would it not? 26 A 27 518 Q 28 A 29 The money that Mr. Traynor said he was going to put clearly indicate that it was put off-shore in 10 24 That is right, yes. off-shore for you? 7 17 That had considerable financial dealings? Well, I don't know what way -- what he did with it. Is it likely? I know it was up to Mr. Traynor, whatever he wanted to do with i t . 1 519 Q 2 A 3 520 Q 4 A 5 521 Q So whatever h e ...(INTERJECTION). You left it to Mr. Traynor? Yes, certainly. Would I be correct in saying that whatever it was, 6 if it did earn interest, it was not declared by you 7 in your own personal income tax? 8 A 9 522 Q 10 A 11 523 Q 12 A 13 524 Q 14 I never had any benefit from that account. Yes ? Nothing. I benefited nothing from the account. The answer is, "No, it wasn't"? No. I see. Just to come back to Purcell Exports Ltd's account? 15 A 16 525 Q 17 Yes . When did it cease to have an account with Guinness & Mahon? 18 A 19 526 Q 20 A Yes. 21 527 Q Yes? 22 A 23 528 Q About 1990 I would say. About 1990? Maybe earlier. Maybe earlier, I am not sure. But about that I would say. Did you make any reference to the off-shore account, 24 in the closing of the off-shore account, when you 25 were closing these other accounts? 26 A I had nothing to do with the off-shore accounts. 27 that stage I had nothing to do with the off-shore 28 account. 29 529 Q Yes? At 1 A. 2 account. 3 530 Q. 4 A. 5 531 Q. 6 A. 7 532 Q. 8 Yes? Or never told anything about the off-shore account. Yes. So...(INTERJECTION)? From Guinness & Mahon or from Mr. Traynor. However, you knew that he was going to open one some place, you did not know where? 9 A. 10 533 Q. 11 No. However, you did not specifically direct it was to be closed, is that the position? 12 A. 13 534 Q. 14 A. 15 535 Q. 16 A. 17 536 Q. 18 A. 19 537 Q. 20 A. 21 22 And I was never asked anything about the off-shore No, no. I did nothing at all about it. You did nothing about it? Nothing at all with that account. Yes? Good, bad or indifferent. Yes? And I was told nothing about the account. Yes? Good, bad or indifferent either, nothing at all about it. 538 Q. Mr. Purcell, thank you for your attendance here 23 today. 24 typed up into a transcript. 25 come in to sign it when it is available to you. 26 will let your solicitor know when that is? 27 28 29 A. Fine. The evidence that you have given us will be We would ask you to We 1 questions, and I apologise for interrupting you on 2 occasion, 3 was summarized in a fashion that was not actually 4 accurate. 5 effect any approval of the summary but rather to 6 rely upon the original answers given. 7 for interrupting you earlier. 8 MR. JUSTICE COSTELLO: 9 I felt that some of Mr. Purcell's evidence I would not wish this transcript to Very well. adjourn now. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED. 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LQAN/OV£RORApT LIMIT OR 3 A LANCS A T C A S . Invtitm ant Cuatomart A/C ““5 , b s c e iv s d I . RBCEIVEO 1 I □ V 4 •• 1 r' in t e r r ate iy " •* 0 Charga fl*»d rats “ ~ !T ^ j .... K\ " an u of ♦ iQ’e ram of Staff Account f l •‘‘i. ___* .... ..... It . —in e r» m e n t„ .^ ‘ R e v ie w h* i IfqppEcablt tide with "XH • date Jf applicable tick with “X “ □ A ppendix X V (110) M r D iarm uid Q uirke, deceased 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Diarmuid Quirke. a) Unsworn statement o f Joan Quirke dated 4 May 2000. b) Cheque in favour o f Diarmuid Quirke o f 15 July 1991. c) IIB statement o f 31 July 1991 re Ansbacher Limited. d) Letter o f 8 January 1992 - Ansbacher Limited to Guinness and Mahon. e) Cheque in favour o f Diarmuid Quirke o f 8 January 1992. f) Letter and attachment o f 7 January 1992 - M r Diarmuid Quirke to official in charge o f payment from Bluehill Investments. g) Deposit dealing ticket no 113281. h) Guinness and Mahon statement o f 23 October 1986 re Amiens S/L. Correspondence received from or on behalf o f M r Diarmuid Quirke. a) Letter o f 10 December 2001 - Mrs Joan Quirke to Inspectors. Aptuenich?m'XV (110)0100 I make this statement pursuant to a request from the Office of the Inspectors Appointed by Order of the High Court to Ansbacher (Cayman) Limited for an unsworn statement. That request was made by letter in writing dated the 28,h March, 2000. My late husband, Diarmuid Quirke, died on the 21st September, 1994. He was 63 years of age at the time of his death. I beg to refer to a copy of his Death Certificate which is attached to this unsworn statement and upon which I have marked the letters and numbers “JQ1”. I was the sole beneficiary under his Will and I took out a Grant of Probate on the 8th February, 1995.1 beg to refer to a copy of the Grant of Probate which is attached to this unsworn statement and upon which I marked the letters and numbers “JQ2”. Throughout our married life I remained at home, and reared our four children and generally looked after our home and family. My late husband was the one who worked outside of the home and as a consequence, during all our married life he looked after all our financial affairs. I was generally aware of what he earned and what investments he was making. As far as I am aware, he never kept anything of significance from me. He was employed by CRH pic. He was, to the best of my knowledge, an Executive Director between the years 1980 and 1991. He retired in 1991. The first time I ever became aware that my late husband might have had any involvement with what has become known as the “Ansbacher Accounts” was in September, 1999, when stories to that effect appeared in the media. At that time I was very concerned as to the accuracy of those media reports because my late husband never mentioned having been or being the beneficiary of an Ansbacher account. I would like to add that my late husband knew he was dying for approximately three months prior to his death and he had ensured his affairs were in order. At no stage did he identify or bring to my attention any such account or that he was the beneficiary of any such account. After reading those accounts in the papers I went through what books and records I had at home but I was unable to find any mention of any “Ansbacher Account”. Indeed, when I was administrating my late.husbands estate no such bank account ever came to light. I beg to refer to a copy o f the Inland Revenue Affidavit attached to this Unsworn Statement and upon which I have marked the letters and numbers “JQ3”. As I have stated, during my marriage to my late husband I was generally aware of what our assets and liabilities were. When I was administering my late husband’s estate I was satisfied that there were no bank accounts missing or unaccounted for and what assets I did identify were what I expected to be in the estate. Because of these media reports which both linked my husband to those accounts and informed the public that Inspectors had been appointed, I felt I should take legal advice. I had no idea how I could confirm the truth or otherwise of what was stated in the papers and I wanted to know what if any relevance there was for me in the appointment of the Inspectors. I would also like to add that those media reports and the alleged association between those accounts and my late husband was a matter of great upset and embarrassment to me. I attended on Mr. Stephen Hamilton, Partner in A & L Goodbody, solicitors who now have their offices at the International Financial Services Centre, North Wall Quay, Dublin 1 .1 believe that I first attended on Mr. Hamilton in relation to this matter on the 27th September, 1999.1 informed him of my complete lack of knowledge of any such account and of my inability to locate or identify any such account. Mr. Hamilton corresponded with and/or spoke to various parties in an effort to shed further light on the matter and in particular to Guinness & Mahon Bank, Irish Intercontinental Bank and solicitors representing Patrick Collery, Ansbacher (Cayman) Limited and solicitors for CRH pic in an effort to identify any such account and what involvement, if any, my late husband had with such an account. I beg to refer to a booklet of that correspondence which is attached to the within unsworn statement and upon which I marked the letters and numbers “JQ4”. The only documents which came to light as a result o f the enquiries carried out by A & L Goodbody on my behalf were two letters which I have pinned together and attached to the within unsworn statement and upon which I have marked “JQ5”. The letter of 8th January, 1992, was produced to Goodbodys by Guinness & Mahon. The letter of 7th January, 1992, was produced to Mr. Hamilton at a meeting he had with solicitors acting for CRH pic. I am not sure what relevance the letter and schedule dated the 7 January, 1992, has. As appears from that letter it is signed by my late husband. As further appears from that letter it refers to a “second statement of sterling expenses for the calendar year 1991.”. I know that my husband during the course of his work for CRH pic travelled extensively in the United Kingdom and I can only assume that he drew down what expenses were due to him for such work and travel at the end of 1991. The other letter is dated the 8th January, 1992 and is a request by a J.D. Traynor requesting travellers cheques in dollars. The sums in the first mentioned letter appear to be modest and the letter requesting payment o f them quite clearly identifies the sums as expenses. In relation to the dollar travellers cheques, to the best of my recollection, after my late husbands retirement we went on an around the world trip and the dollar travellers cheques were used on that holiday. While I cannot be certain o f it, I have some very vague recollection of my late husband saying that the travellers cheques were derived from business expenses. In relation to the correspondence, I would like to make the following points; (a) Ansbacher (Cayman) Limited confirmed that they have no record of an account either at the date of the death of my late husband or at the date of writing their letter of the 17th December, 1999. (b) Guinness & Mahon confirmed by letter dated the 17th December, 1999 that they had no other documentation other than the letter of the 8thJanuary, 1992 which they had already provided and a copy of which I have already attached. (c) Irish Intercontinental Bank were unable or unwilling to provide any information. (d) Padraig Collery was unable for the reasons stated in his solicitors letter to provide any assistance. 9 One final matter which may or may not be relevant to the Inspector’s enquiry is that when I discussed with my children the results of the enquiries conducted on my behalf and the matters which the Inspectors required assistance on, some of them recalled or thought that my late husband had a Guinness & Mahon bank account and cheque book many years ago. Mr. Hamilton contacted a Mr. Cathal MacCarthy in Guinness and Mahon who confirmed by telephone on the 11th October, 1999, that at some time my late husband did appear to have a bank account with Guinness & Mahon and that it had only been a small non consequential account and he would let us have further details. To date no details have been provided though, as appears from the correspondence at “JQ4” above Guinness & Mahon confirmed by letter dated the 17th December, 1999, that they had no other documentation other than the letter of the 8thJanuary, 1992, relating to my late husband and the various court orders the subject of the present inquiry. 10 There is nothing else which I can think of which might be o f assistance. If I remember anything else of relevance or obtain or find any relevant documents I will of course be in contact. Dated: Hi M.tu< 2-&Q& T Signed: Doonbeg, Silchester Road, Glenageary, Co. Dublin. N:\LITIGATE\WPYJT\JTST0201.05A 6 0 -0 8 -2 0 N a tio n a l W e s tm in s te r B a n k PLC & L S tn J u ly , ,.9 1 . Q uernaay B ranch PO B o x N o M . 3 5 H I ( ft S tr M t, S t P » t* r P o r t. Q uam aay Psv D . F .' Q u ir k e o r o rd a r £ 2 ,8 7 2 .0 0 Tw o T h o u s a n d E is h t H u n d re d a n d S e w n :v -T w o P FOR AND ON KHALF OF ■ JJ D tlU . INVC«TMENT« LIMITED A / 0* — A u r i- a ic AUTH-SI3 / ■>■000 20 5* s z. 7 0 6 5 6 23 l«» J 2-H Z IRISH INTERCONTINENTAL BANK LTD. •1 MERRION SQUARE DUBLIN 2 Tatephon*: (01) M19744 T«Im : 33322 FacslmUa: (01)1718034 ANSBACHER LIMITED C/O CORPORATE SERVICES A/C 02/01087/81 GBP DEP CL OEM NON RES DATE STATEMENT DATE: DETAILS (V *" € 4 - tu . 22Jul91 BALANCE FORWARD RENEWAL DEPOSIT ON: 319866 FX OT640247 LODGEMENT FXDT640248 LODGEMENT , DT10B42S WITHDRAWAL DT108084 LODGEMENT DT10B085 LODGEMENT FX DT64055S LODGEMENT FX DT640556 LODGEMENT 23Jul91 DT fWHb tODGfccflbNT DTI08452 WITHDRAWAL DT1084S3 WITHDRAWAL 24JUI91 RENEWAL DEPOSIT ON: 999728 FX DT640564 WITHDRAWAL 2SJul91 OT108SS8 TRANSFER TO 02/01062/81 DT108559 TRANSFER FROM 02/01062/61 FX DT640269 WITHDRAWAL 26Jut91 DT1O0182 LODGEMENT OT108575 TRANSFER TO 02/01062/81 29Jul91 DT108195 LODGEMENT * r. VALUE DATE 22Jul91 22Jut91 22JUI91 22JUI91 22JUI91 22Ju»1 22JUI91 22JUI91 30Jun91 23Ju»1 23JUI91 24Jul91 24Jul91 25Ju»1 2SJu»1 2SJul91 25Ju»1 26Jut91 29JUI91 DEBIT 18.000 00 3,000.00 1,999.56 162.80 155.00 2.083.33 4.S96.7S CREDIT BALANCE 11.205.875 87 44.94 11.205,920 81 2.699.40 11,208,620.21 125.97 11.206.748.18 11.190,746 18 52.15 11.190.798.33 44.26 11.190.842.59 115.07 11.190.957.66 153.27 11.191,110 93 248.874 83 11.439.985 76 11.436.985.76 11.434.986 20 18.80 11.435.005 00 11.434.842 20 11.434,687.20 2.91666 11,437.603.86 11.435.520.53 154.00 11,435,674.53 11,430,677 78 2.872.00 11,433,549 78 OVERDRAWN BALANCES ARE MARKED DR Lhnltefr Please reply to: 42 Fitzwilliam Square, Dublin!. Tel: 765144/763065 Fax; 612035 P.O. Bax 887, Onad Cayman, Cayn ia West Indies Telephone: (1 » )j ^ W s i Tri Facsimile(809) 949-7946(809) 949-5267 8th January, 1992. M. David Humphries, Esq., Senior Manager - Operations, Guinness S Mahon Limited, 17 College Green, DUBLIN 2. ■> Dear David, Could you please arrange to let me have for collection U.S. Dollar Travellers Cheques as follows: US$2,000 in $100 cheques in name of Mrs. Joan Quirke US$2,000 in $100 cheques in name of Mr. Diarmuid Quirke The address of Mr. and Mrs. Quirke is 'Doonbeg', Silchester Road, Glenageary, Co. Dublin. I would like to have these collected on Monday next, 13th January, and 1 would arrange to let you have the signed receipts back right away. . The cost should be debited to Ansbacher Limited re Poinciana Fund No.2 Account No.08428030 and'I would be grateful you could let me have a note of the amount debited when letting me have the Travellers Cheques. Yours sincerely, .D . T r a v n o r . * * * A M K M B S X O rTH lA M B A C m D fm X A TIO M A l.n K Jrra M X JP O rO O M F A N IX S w n x a im l o c a t o m « bm um m , v m ix qu— MmaH mi________ Huma. sr. xnwiifti twoujwiqai . 1; V - 60-09-20 'N a t i o n a l W e s t m i n s t e r B a n k Quemeey Branch P L C & IQ PO Box No55. 35 High S treet, S t Peter Port, Guernsey or ordar * im a . I tafeatJSikbd FOR AND ON BEHALF OF BLUEHIU. hA i 3W -- A odfo ‘ .. INVESTMENTS LIM ITED " ... ... . auth-siq ’AUTH-SIQ ••0 0 0 6o*osa q « : v o & s & z a i ? I Doonbaf, •SQehMtarRoad, CHanfaaijr, Co. DaUhi. 2805291 7 ^ f 4 t*rw vJLdL **^%uf>Kjii(, *^ousd f /i< yii t ^*3. ^ '^ v W V ^ * w x t ^ * » "«. ^ .^ 9 A 11 >ti r~fc> ■» 3 mi S^> • w * -» d k^JL ' u - * tl it? ■ • (K . : (w X a *~£ • £\ *•* T r p p j- "Jprw** «"»v*v Q>* .".up wj ------- - v ^ ^ j — y i j f - Arthur Cox 23/05/00 16:32 PAGE 004/6 RightFAX DEPOSIT DEALING TICKET Dealer TreaauiyCopy___________________ Customer \ FIXED REPAY \ Contract No. 1 1 3 2 8 1 AUTHORISATION IS REQUIRED NOSTRO IN— DEPOSIT W# borrow -w t f afct onOeposrt Cuitancy * S G.Q>S> V j^ Amount ^ (0 * 1 S % O Q C v v y u C. * Q Wodobll your A/C_____________________________ NOSTRO OUT ~ LOAN Wa plica - wa lend - we repay 3 tan Date J5& VL. Maturity Dale IflUxwstRnta We wad* your A/C SPECIAL INSTRUCTIONS RelieverData mww Broker Phone Telex mvwh Reuter Principal & In i OUT TO - COenfs Imtructlona At Maturity OUT TO Clanf s Maturity Instructona . r• i ' \ \iv* ' V r c ' ‘ . f ■f'-\£'V.VV. «" li- 's.W. ; .. * »»*». ■'-'t * c o ‘ \. Y>\ • M O STRO C o n f irm a tio n CaM \ C *CO Par C heque O' (Mrequired and not known write N) G +M G U IN N E S S + M A H O N LTD BANKERS 17 C ollo g s G ra e n D ublin Z P.O .B ox 55A. T«l«phone:796944 ACCOUNT NAMC AMIENS S/L NO I ACCOUNT cukkcncv IR IS H POUNOS ACCOUNTNUMBER 10£lQ70V'l LED G ER otscmmoH RESIDENT CURRENT DATE PAMICUIARS ^BALANCE BROUGHT FORWARD DRAWN LODCEO ORA UN ORAUN DRAWN Z30CTM ORAUN LOG 16OCT06 200CT 06 21OCT06 220CT8t 1 nir-it balane#ip«wnmi Ihl* ilWtfb* iht8mino«(i«ilpfenvttyof*«*duo•©•♦icy VAU>£ DATE ocair S1AHMCMIOAH S T A T E H 6M T PACE N O . NO. 230C T86 cneon BALANCE . 5, 0 0 0 . 0 c 4 1 5 . QC lO.OOQ.OC 5 ,<» 15 .0C 9 6 0 . OC 1 * 1 3 6 .3 6 0.00 1 5 ,0 0 0 .0 0 5 , <*15. 00 1 7 , 7 6 0 . OODR 5 0 , 0 0 0 .0 0 3 1 , 1 0 3 .6 4 OVtflONAWND*l/HCtSAM£MARKCOOn "Awendixxvamwg Doonbeg, Silchester Road, Glenageary, Co. Dublin. 10th December, 2001 Y o u r Ref. C / Q O / 1 N S P M Re: Mr. Diarmuid Quirke -Deceased Dear Sirs, I a m replying to your letter to m e of 20th November, 2001. Please note that m y late husband’ s na me is Diarmuid Quirke, not Dermot Quirke. There are a number of points which I m a k e in reply to your letter: 1. I understand that you accept that you are obliged to afford all fair procedures and natural justice (together with the opportunity to reply) to those individuals against w h o m allegations and inferences are m a d e as a result of your investigation. The very fact that m y late husband himself is unable to reply to the inferences set out in your Preliminary Conclusions is contrary to these principles of fair procedure and natural justice. Indeed, based on the fragmentary evidence being put forward by your office, I do not accept that there are sufficient grounds for you to reach the conclusions arrived at. For the avoidance of doubt, these inferences are wholly rejected by m e - both as w i d o w of m y late husband and also as Executrix to his estate. 2. A s currently drafted your Preliminary Conclusions have created unfavourable innuendo against m y late husband’ s reputation. I a m prejudiced in m y ability to provide a comprehensive reply to these conclusions in circumstances where you have only supplied m e with a minor reference in your draft report and in circumstances where there is insufficient information for m e to comment on inferences made. A s an example of the lack of clarity in the documentation provided to me, what is meant by the allegation that m y late husband was “ a client o f Ansbacher” ! Is there a definition for this expression? Are you willing to provide m e with all other sections of your draft report to which these inferences (and accompanying documentation) relate? 3. With the exception of the letter from m y late husband dated 7th January, 1992 (and I will deal with that below), there is no documentation whatsoever linking him to Ansbacher accounts. In addition, there is no evidence that, with the exception of this letter, m y late husband ever had sight of any of the other documents which you have sent me. This is a -further example of the principles of fair procedure and natural justice being compromised, the effect of which is to prejudice m y late husband’ s position. 4. Dealing with the letter from m y late husband dated 7th January, 1992. In paragraph 2 of page 2 of your Preliminary Conclusions, you state:“ Ansbacher ’ s service w a s used to facilitate the purchase of these travellers ’ cheques a n d Mr. Quirke w a s familiar enough with h o w the system operated to direct the incoming funds of Ms. Williams. ’ ’ T o suggest that m y husband was ‘ familiar enough with h o w the system operated\ you appear to be wholly reliant on his letter dated 7th January, 1992 where he stated:“/ w o u l d request that y o u forward your cheque to Ms. Joan Williams at 42 Fitzwilliam Square w h o will be authorised to deal with it on m y behalf. ” T o assume that m y late husband’ s request that a cheque be forwarded to Ms. Joan Williams makes him ‘ familiar enough with h o w the system operated ’does not bear scrutiny. The document suggests that Ms. Williams was authorised to deal with the matter but it certainly does not show that m y late husband was familiar with the workings of Ansbacher accounts. It is unfair to m a k e such an assertion in circumstances where it cannot be put to m y late husband and w e are deprived of explanations which he might have offered as to the background to and the meaning of the note in question. 5. At paragraph 3 in page 2 of your Preliminary Conclusions you refer to sterling travellers’cheques of £1,324.59. H o w e v e r you have failed to provide m e with any documentation with regard to this amount. Please let m e have a copy of the relevant documents at your earliest convenience. Y o u should be aware that whilst m y late husband retired from insert C R H pic in 1991, he remained Chairman of Irish Cement Limited (a subsidiary of C R H pic) up until his death in September 1994, a position that required significant overseas business travel. 6. For your information, I have been advised by C R H pic’ s solicitors that Bluehill Investements Limited (a subsidiary of C R H pic which was based in Guernsey) was a company set up for the purpose of assisting C R H pic in the financing of overseas acquisitions. I a m advised that this company was used to reimburse some expenses incurred by those senior executives w h o spent time outside Ireland working on the international development and monitoring of overseas acquisitions. The statement at paragraph 5 on page 1 of your Preliminary Conclusions that: re­ “ Bluehill Investments Ltd w a s a Guernsey c o m p a n y used by C R H for the m a k i n g of certain sterling payments to its executives. ” creates further unfavourable innuendo. In short, there is no evidence that m y late husband had any knowledge of or was conscious of dealing with any Ansbacher account. I look forward to hearing from you. Yours faithfully, Joan Quirke T he Office of the Inspectors appointed by Order of the High Court to Ansbacher (Cayman) Limited, 3rd Floor, Trident House Blackrock, Co. Dublin. By Hand STRICTLY PRIVATE & CONFIDENTIAL ADDRESSEE ONLY. A ppendix X V (111) M r Jerem y Robson 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Jeremy Robson. a) Guinness and M a h o n internal m e m o of 4 June 1986 - J D Traynor to P Scully. b) Telex of 17 December 1985 - G M C T to Guinness and Mahon. c) Ansbacher Limited statement of 24 October 1990 re sundry sub co a/c. d) Telex of 16 January 1990 - Guinness and M a h o n to Guinness M a h o n London. e) Letter of 15 January 1990 - Ansbacher Limited to Guinness and Mahon. f) Letter of 19 February 1990 - Ansbacher Limited to Guinness and Mahon. g) A/c statement print-out of 9 April 1997 - Ansbacher C a y m a n Limited call deposit a/c. h) A/c statement print-out of 9 April 1997 - Ansbacher C a ym an Limited call deposit a/c. i) Letter of 17 October 1990 - Ansbacher Limited to Guinness and Mahon. j) Guinness and M a h o n ledger statement of 26 March 1987 re GMC T /W e n t w o r t h Trust. k) Guinness and M a h o n ledger statement of 30 June 1987 re G M CT / We nt w or t h Trust. 1) Guinness and M a h o n copy statement of 30 December 1987 re G MC T/ W en t w o r t h Trust. m) Guinness and M a h o n copy statement of 29 December 1989 re Ansbacher re Wentworth. n) Guinness and M a h o n ledger statement of 30 June 1987 re G MC T/ W e n t w o r t h Trust. o) Letter of 19 January 1990 - Ansbacher Limited to Guinness and Mahon. p) Letter of 8 February 1990 - Ansbacher Limited to Guinness and Mahon. 07066 Re: WENTWORTH TRUST and JEREMY ROBSON. I w o u l d b e g r a t e f u l if y o u w o u l d p l e a s e n o t e t o a d v i s e John Furze by t e lefax any time you change c u r r e n c i e s for above. The funds are h y p o t h e c a t e d to G.M.C.T. and t h e r e f o r e I w a n t t h e m k e p t in t h e p i c t u r e . A l t h o u g h in o r d e r f o r y o u t o d o c o n v e r s i o n s t h e f u n d s m u s t a t a l l t i m e s r e m a i n w i t h us. JDT c.c. D.P.C cocc\ /e^c s>6- „ I ) V>5> ^ C 5 i - C f v «=> 2 i Z k - o S TEST 15/1114 HG GUINNESS M AHON LTD \ M A VoVUPvl^*^ niJ TRFi wD n U " IO D UFB,1L ITNI N • 2? I RELAN DE M A N T R U S T N Y K 1 2 / 1 7 / 8 5 V . *» ^ K C B 137 TRAN 0001002534 KjW\J ^ ^ E D I T E D Y O U 1 2 / 1 7 / 8 5 D L R S 6 5 j 5 0 2 . 0 9 I N S A N E DAY F U N D S S U B J E C T TO j.NAL S E T T L E M E N T Y O U R R E F E R E N C E 1448 . / S E C E i V E D F R O M I R V I N G T R U S T COKPANY NEW YORK NEW YORK VIA C H 1PJTB/0 GUI NN E S S MAHON CAYMAN T R U S T LTD. P. 0. BOX S87 G R A N D C M m AN j B R I T I S H W E S T IND I E S . SR B B I / B N F / T E L E X A D V G M D U P O N R E £ Z 1 P T ATT J. D. T R A Y N O R . OUR REFERENCE 0001002534. i0‘48 17DEC85 254; 19:39:06 17DEC85 21:52:43 17DEC06 26924 21:52:49 17DEC85 2:.: 54 s 17 N:.NN lX>EC35 09329 21:56:21 17DEC85 ?9C >7 1 ^ i H T E S L G* 3Q-'t3XMAFa,'-*• iiif iw 2 ) t B22»9i . •: J£g£ .• .■ ^ v - w . ____ '-:s"4?, •■•.%'*“*.j£ r-X r. v,5 *. £. vr .,4 \**\ •-. a.•.\.'iri.«, v# .* ir ■fr • '..'.■WTSVOi-.r^ —r~n“*tt“n~tmt rirnmmion. * - 4 ' I t.t (111N999 i - I UIN ess'?ii??g??g hr 17 Gillian Om? Duth no.3? .. uusr m' "gum? .5102; uh; I- 3? no. 1 LEDGER mm? mm? aoJunu I t. ?I?a 2" 1 alcmc'??hw I. Want .- Xch?cucrllemmnm - kg xcu?muv?mmr?1m5g ?19765.76 ug??sturq,mmi .-.. . ?usr 41.111.? auxin/unwantme nan-20 mm}. mime: .. . .. -. m1 :cmacmeyrmm-nusy 61.650.79 .. 93. 16 -. ,xqi?-Zeucr?luemaonm nusr .- - mu:- 535722-11. . '4 . ruin-unnumqu . . . A g u ih n im m u o n ctoD.r.c. cayhab t r u s t / N E m o im * nun CXJIKBM t*BCMCMMM TRUST / W mORTH TRUST •••CopyStatmant «•* CALLOBKMIT BalttMbrought forward 17JLY •? EXCHCMCT/WmrrWOaTW TRUST 24 JMT «7 BXCH OMCT/VEXTWORTH TROBT 10 AU9 * 7 BXCH / imh 6 n l t o 17«*• Q*«"»>**»»tO-fc,HAT.U'h^TMH. BANKERS * cca » a GUINNESS HAHON CAYMAN TRUST / OEUTCHNARKS . V : euwrnoiiEXTERNAL.CALL 0/A zI«AR«T »SAUNC£^6RQUGHr FORWARD QlvJUNaT,EXCHfCMCT/WENrHORTH TRUST 3^JUN47iEXCH GftCT/lfENTWORTN TRUST* DSJUttgTTINTEREST .;•; g WENTWORTH TRUST LEDGER cn ■ - m ACCOUNTMMKft09250042 •umwfrwji 30JUN87 :s> & :Z:£.«*• ii£o7 86.373.03 ‘1! !v!-•r\sr\ri.,-sA4r**v. iTrn-\::s.-Ci.f: .'.J** ;t V‘ •.•:: j;t.'• .K• .-itWV-r. - -I “ Jsg& ^tii*<<»• X .;W ~ mmtmtmmuwidjiihmimiian Please reply to: 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 Fax: 612035 P.O. Epx 887. Grand Cayman, British Wef Indies 4653/4 Telex: CP 4305 Fax: (809) 949-7946 (809) 949-5267 19th J a n u a r y 1990. M. Lanigan-O'Keeffe, Esq.# Managing Director, Guinness & raahon Limited, 17 College Green, DUBLIN 2. Dear Martin, Could you please arrange to debit our A m o u n t re W e n t w o r t h A m o u n t No. 09250050 and wredit our A m o u n t No.1 3154602 w i t h £ 2 ,0 0 0 .0 0 . Yours sincerely, J.D. Traynor. A Member otrheHenry AnsbacherHoldingsPLC Merchant BankingCroup Please replyto: 42 Fitzwilliam Square, Dublin 2. Tel:765144/763065 Fax: 612035 P.O. Box 887. Grand Cayman, British West Indies Phone: (809) 949-4653/4 Telex: CP 4305 Fax: (809) 949-7946 (809) 949-5267 8th F e b r u a r y , 1990. M. L a n i g a n - 0 1Keeffe, Esq. Managing Director, Guinness & M a h o n Limited, 17 College G r e e n , Dublin 2. Wentworth T r ust Re: Dear Martin, There is a F i xed D e posi t in the above name m a t u r i n g o n the 12th February in the sura of £49,926.85. „__ .. /C*) At maturity c o u l d you please arrange to transfer this b a l a n c e to Ansbacher S u n d r y Sub - Company Account N o . 1 3154297 and let me have conf i r m a t i o n in due course. Yours sincerely, J.D. Traynor. t / U J THE HIGH COURT IN T H E M A T T E R O F T H E C O M P A N I E S A C T S 1963 to 1990 A N D IN T H E M A T T E R O F P A R T II O F T H E C O M P A N I E S A C T 1990 A N D SECTIONS 8 A N D 17 A N D IN T H E M A T T E R O F A N S B A C H E R ( C A Y M A N ) LIMITED (formerly G U I NNES S M A H O N C A Y M A N T R U S T LIMITED, A N S B A C H E R LIMITED and C A Y M A N I N T E R N A T I O N A L B A N K A N D T R U S T C O M P A N Y LIMITED) R A A e p o r t of ppo inte d ffairs of to A t h e E In s p e c t o r s n q u i r e n s b a c h e r L into (Ca t h e y m a n ) imited Published by Order of the Court made on 24 June 2002 V o l u m e [i i ]: A ppendix XV(112) to XV(126) ISBN 0?7557?1355?9 Government of Ireland 2002 A ppendix X V (112) M rs Sonia Rogers 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mrs Sonia Rogers. a) Transcript of evidence of Mrs Sonia Rogers dated 15 January 2002 including a letter of 4 April 2002 - Kennedy McGonagle Ballagh to the Inspectors. b) Letter of 21 December 2001 - Kennedy McGonagle Ballagh to the Inspectors. c) Extract of transcript of evidence of M r Padraig Collery dated 11 January 2000 . d) Transcript of evidence of cross-examination of Padraig Collery on behalf of Mrs Sonia Rogers dated 8 March 2002. UNDER OATH ON TUESDAY, 15TH JANUARY 2002 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MS. N. MACKEY BL M R . P . ROWAN Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MRS. ROGERS Represented by: MR. RICHARD LAW NESBITT SC Instructed by: MR. MICHAEL O'SHEA KENNEDY McGONAGLE BALLAGH SOLICITORS 2 0 NORTHUMBERLAND ROAD DUBLIN 4 WITNESS MRS. S. ROGERS I EXAMINATION MR. NESBITT PAGE 22 33 1 2 3 4 5 6 MS. MACKEY: Good morning, Mrs. Rogers 7 and Gentlemen. We have 8 met before. 9 MRS. ROGERS: Yes. MS. MACKEY: So, I do not think 10 11 I need to introduce 12 myself but you have not met my colleague 13 Mr. Rowan. 14 occasion. He was not here on the last 15 16 There are now four Inspectors as opposed to three 17 the last time you were here. 18 Sean O'Leary and Mr. Michael Cush, are not here 19 today. 20 to your submissions but the others will have an 21 opportunity to read them when they are in transcript 22 and we will all consider them. The other two, Judge So, just the two of us will be listening 23 24 You are all very welcome and I understand that 25 today Mr. Nesbitt wants to make some submissions 26 on your behalf and that then you yourself want 27 to adduce new evidence. 28 situation, am I right? 29 I think that is the 1 propose, with your 2 permission, is that I will make one or two points 3 on the current state of affairs in relation to 4 your preliminary conclusions, indicate in broad 5 terms what we believe we have to say that may 6 or may not have an impact on those that we 7 believe is something that would be helpful to 8 you to know, and then with your permission I will 9 bring Mrs. Rogers through the evidence she has in 10 that regard, and obviously any questions you have 11 then will be asked and that would be what I would 12 propose today. 13 MS. MACKEY: Yes. 14 MR. NESBITT: There are a series of 15 side issues which I will 16 highlight as I go through. 17 things to note at this point in time. They are just really 18 19 I do not know if you have available to you at 20 this time the preliminary conclusions that you 21 have drawn in respect of Mrs. Rogers. 22 do not have I will just go through them slowly. 23 MS. MACKEY: We have, yes. 24 MR. NESBITT: You very kindly set out 25 If you in numbered paragraphs 26 what I think is best described as the sort of 27 factual matrix from which your preliminary 28 conclusion was drawn and there is two numbered 29 paragraphs in your preliminary conclusion. 1 The first is uncontroversial and then the second 2 contains a number of matters. 3 is going thought it and saying the bits with which 4 we have no difficulty and then come to the bit that 5 we believe there may be some additional information 6 that might help you one way or the other. 7 MS. MACKEY: Yes. 8 MR. NESBITT: The first point you 9 What I propose doing make is that Mrs. Rogers 10 told you earlier that after her husband's death the 11 late Mr. Desmond Traynor told her that her husband 12 had established an offshore trust for her benefit 13 and that of the children. 14 with that as it was said. We do not take any issue 15 16 Two i s : 17 18 19 "At a later stage, Mrs. Rogers learned that the trust was in the Cayman Islands ..." 20 21 And again we do not take issue with that. 22 what she said. 23 24 And then you say: 25 26 27 28 29 "Mr. Traynor told her that the trust 'dealt in bloodstock' through a company called Ascot Holdings." That is 1 2 3 4 5 "Mrs. Rogers subsequently conducted all lodgements to and withdrawals from the trust funds through Mr. Traynor and Mr. Padraig Collery." 6 7 8 Now, we believe we have information that throws a 9 new light on that and I will explain what we think 10 the evidence doses establish. 11 12 Secondly, that: 13 14 15 16 "Mr. Collery has told the that the trust funds were Captain Rogers's death in coded A/A3 in the name of Ross." Inspectors held after an account Hamilton 17 18 Now, we have not seen Mr. Collery's evidence. 19 I note it is not actually listed in the supporting 20 evidence to deal with the conclusion and we read 21 what is said there but we cannot know that to be 22 correct or not correct and I am not in a position 23 to say anything materially about that at the moment 24 but it is a concern of mine that we have not seen 25 that evidence and I will say no more at the moment. 26 27 28 29 1 2 3 "The Inspectors are satisfied that Mrs. Rogers's dealings with the trust following her husband's death meant that she was from that time on the beneficial owner of funds in Ansbacher." 4 5 6 And again personally I have a slight difficulty 7 with understanding the exact context and gravelment 8 of that statement of fact and other than saying I 9 am not certain exactly what is looked to to sustain 10 that I believe that probably the sustaining element 11 of that is that earlier you had formed the view that 12 she conducted all lodgements and made withdrawals to 13 the trust and I can understand that if that is what 14 it says. 15 16 So, what we hope to do today is to put before you 17 some additional evidence that in fact indicates 18 that Mrs. Rogers did not in fact conduct lodgements 19 or withdrawals from the trust fund, and that is the 20 trust established by her late husband, and in doing 21 that I will just outline now where we hope to go 22 with the evidence. 23 MS. MACKEY: Yes. 24 MR. NESBITT: If you look back 25 through the transcript 26 it is clear on the evidence of Mrs. Rogers from 27 information she learned from others, largely 28 Mr. Traynor, that shortly before her husband's 29 death, you will recall that he was dying of 1 cancer so he had forewarning he was going to die, 2 he established a trust. 3 trust is what you describe as the trust in the 4 Cayman Islands. 5 well and again the evidence in her first transcript 6 deals with that. 7 trust under the Will. 8 MS. MACKEY: Yes. 9 MR. NESBITT: And also there was He died in 1984 and that He did other things though as He left a Will that established a That is a different trust. 10 property held in trust 11 that was later sold and that was for the benefit 12 of identified persons. 13 MS. MACKEY: Yes. 14 MR. NESBITT: This was sold and money 15 was distributed. 16 MS. MACKEY: Yes. 17 MR. NESBITT: So, there were trust 18 arrangements there that 19 were none of the trusts we are talking about. 20 MS. MACKEY: Yes. 21 MR. NESBITT: And the evidence we want 22 to lead today touches 23 upon two central areas; one, is we have obtained 24 a sworn declaration from Mr. Barry Benjamin who 25 was concerned with the operation of the trust that 26 has been said to be based in the Cayman Islands, and 27 secondly, given what Mrs. Rogers learned there she 28 then had to work out where certain other money had 29 gone and she will be giving you evidence of that. 1 2 You will be hearing evidence from her that she is 3 a person who had money in her own right before she 4 was married at all. 5 She married Captain Rogers. 6 she then ran her own business affairs. Her maiden made was Pilkington. He died in 1984 and 7 8 After his death she had invested in two investment 9 bonds, assurance policies, call it what you will, 10 that returned to her at the end of 1988, the 11 beginning of 1987 and 1988, approximately £151,000 12 which she gave to Mr. Traynor to manage to her 13 advantage anticipating that when she needed money 14 she could call upon him and she would get the money 15 back. 16 17 She will tell you that she had always believed that 18 that money was probably put into the trust that had 19 been set up by her husband. 20 that did not happen if you believe the sworn 21 declaration of Mr. Benjamin and in my opinion with 22 respect it is evidence that is available to you 23 that probably forces that conclusion upon you. It is now clear that 24 25 In the circumstances a document she produced on 26 the last occasion which you appended to your draft 27 conclusions which is a handwritten list of payments. 28 MS. MACKEY: 29 Yes. 1 2 MR. NESBITT: 3 It is Exhibit 2, sorry, and it is misdescribed. 4 There is a typical error. 5 list of drawings produced by Day Mason. 6 be Kay Mason. 7 MS. MACKEY: Yes. 8 MR. NESBITT: K-a-y. 9 MS. MACKEY: Yes. MR. NESBITT: That may have been 10 11 It is described as the It should corrected on a later date. 12 This list we say now, and if you receive the 13 evidence and view it in a favourable light we say 14 that, this is a list of payments that were received 15 back from Mr. Traynor and the only source of that 16 money was the money that she had given in 1988 to 17 Mr. Traynor; the returns of the £151,000 from the 18 two investment bonds. 19 20 The next document I would like to hand to you is 21 a copy of the sworn declaration from Mr. Benjamin. 22 MS. MACKEY: 23 of that that Mr. O'Shea 24 sent to us. 25 MR. O'SHEA: 26 27 I think we have copies No, it wasn't actually sworn at the time. MR. NESBITT: This is the 28 actual...(INTERJECTION). 29 It was not sworn. 1 2 MS. MACKEY: I see, yes. 3 M R . ROWAN: Thank you. 4 MR. NESBITT: Now, again to short 5 Thank you. circuit things perhaps 6 I could put in context what he is talking about 7 without bringing you through the entire of the 8 former transcript. 9 MS. MACKEY: Yes . MR. NESBITT: Mr. Benjamin is a man 10 11 I think, who became 12 known to my client during the McCracken Tribunal 13 when these issues first started arising and he 14 describes himself as the President of Western 15 International Trust Company, which I am sure 16 is probably known to you. 17 that they were licensed to carry on the business 18 of company management and the provision of 19 trustee and related services. He makes a point He indicates: 20 21 22 23 "All the issued shares in Ascot Ventures Limited ("Ascot"), a Cayman Islands company, were registered in the name of Western." 24 25 And you will recall from the earlier transcript 26 that the business of the trust, which is said 27 to be in the Cayman Islands, was managed by Ascot 28 Holdings later changed to Ascot Ventures but what 29 we then learn is that Mr. Furze, John Furze, the 1 original trustee, was holding shares in Ascot as 2 a discretionary trustee of funds provided by the 3 late Captain Rogers, which one would expect. 4 5 It is then said: 6 7 8 9 10 "In accordance with the policies of Western, Ascot was dissolved in 2000 and the assets were transferred to a newly incorporated Cayman company called Rainy Day Ltd. ("Rainy Day"). All the issued shares in Rainy Day are held by Western as trustee." 11 12 So, it seems, if that is accepted as an honest 13 analysis of how the property held by the trust 14 that was set up by Captain Rogers, that you start 15 off with the Ascot company as holding them. 16 see control in Western who is a trust management 17 company. 18 new company Rainy Day. 19 much difference; instead of Ascot it is now Rainy 20 Day. You You see the dissolution of Ascot and a It does not seem to make 21 22 However, it is what happens thereafter that is 23 important in this particular declaration. 24 Mr. Benjamin says is to the best of his information, 25 knowledge and belief - and following a search of 26 the records in his possession: 27 28 29 "No additional capital has been contributed to the said trust since its inception save those funds contributed by Capt. Rogers What 1 immediately after the creation of the trust." 2 3 4 Secondly, that: 5 6 7 8 9 10 "The Declaration of Trust establishing the said trust and letter of wishes cannot, after a thorough search, be found and are presumed to have been lost. Mr. John A. Furze M.B.E. was the original trustee of the said trust and that trusteeship passed to Western on his death. 11 12 The said trust has funds on deposit through Rainy Day." 13 14 And then: 15 16 17 "No appointments or loans have been made from the said trust to any member of Capt. Rogers' family, nor to any other person or entity." 18 19 20 Now, you will recall that on the last occasion 21 a document establishing that in the numbered 22 account that had been referred to there was 23 some £2m. 24 that that is the money that standing to the credit 25 of the trust that was established by her husband 26 but if you believe Mr. Benjamin's account as it 27 appears here, that nothing was taken out, there 28 were no appointments, that means that when my 29 client gave evidence on the last occasion that Now, my client is prepared to accept 1 she got money back from Mr. Traynor that she 2 believed came out of that trust, that is wrong. 3 4 There has to be an explanation for where 5 the money came from and the explanation is as 6 I have indicated, subject to her giving evidence 7 about that, that she had given to Mr. Traynor 8 the proceeds of these investment bonds in 1988 9 of some £150,000 and received the money back 10 in drips and drabs and some money would still 11 be owning. 12 13 We are concerned that if that be an appropriate 14 factual statement to put in the context of the 15 preliminary conclusions that a number of issues 16 flow from that in respect of the preliminary 17 conclusions. 18 19 The first would be that it is now a mistake to 20 say that she conducted all lodgements and made 21 withdrawals from the trust funds because that 22 simply did not happen. 23 put in and nothing has happened since. 24 was a trust established and it has remained there 25 and there is money in the trust and there are people 26 who are beneficiaries. 27 to have that corrected. 28 29 The trust fund had money So, there So, we would be concerned 1 seeing the evidence he gave but it seems to me 2 unlikely, assuming that evidence is there, that 3 there would be any major dispute that the money 4 umber in account coded A/A3 is the current money 5 that is in the trust established by the late 6 Captain Rogers but I would like to see Mr. Collery's 7 evidence in that regard before committing to that. 8 9 Then, finally, I am not sure how you would best 10 position what the position is in relation to 11 that trust but if the trust was established 12 and there has been no appointments and there 13 has been no management necessary save through 14 the trustees I think it seems inappropriate to 15 say that Mrs. Rogers is appropriately described 16 as the beneficial owner of the funds. 17 is is one of a number of beneficiaries of the 18 trust and there has been no appointment and that 19 is really as good as it gets. What she 20 21 I suppose the most principle upshot of all of 22 this is that -- well, no, I need not go into 23 that issue. 24 tell you about. 25 it is important to get it right. 26 going to be prima facia evidence of the facts it 27 contains and prima facia evidence of your opinions 28 and given we have got the Benjamin statement and 29 we have the additional evidence from Mrs. Rogers on, So, that is what we would like to It may seem small but I think Your report is 1 you know, where the money could have come from if 2 it did not come out of the trust. 3 MS. MACKEY: 4 I wonder if I could just interrupt you to ask you 5 one question, Mr. Nesbitt? 6 MR. NESBITT: Yes. 7 MS. MACKEY: Do I understand that 8 9 10 you are accepting for the moment that A/A3 represents the trust? MR. NESBITT: 11 Well, I do not know because I have not 12 seen Mr. Collery's evidence. 13 through -- all we are told is: When you go 14 15 16 17 "Mr. Collery has told the that the trust funds were Captain Rogers's death in coded A/A3 in the name of Ross." Inspectors held after an account Hamilton 18 19 I have seen none of that evidence. 20 MS. MACKEY: Yes. 21 MR. NESBITT: My client believes, 22 as you see in her past 23 transcript, that there is a sum of money which 24 she has been told was held in a trust. 25 MS. MACKEY: Yes. 26 MR. NESBITT: She believes it is the £ 2 m that is referred to. 27 28 29 MS. MACKEY: Yes. 1 2 3 4 MR. NESBITT: The best she has got by way of firm evidence is 5 6 what you say Mr. Collery said. 7 MS. MACKEY: Yes. 8 MR. NESBITT: And I just have not seen that so I do 9 10 not know. 11 MS. MACKEY: Yes 12 MR. NESBITT: So, I am possibly saying 'yes' and 'no'. 13 I do not 14 wish it to be said that I have made that concession. 15 MS. MACKEY: Yes. 16 MR. NESBITT: However, I am not in a position to adduce other 17 18 evidence about the A/A3 designation but I would 19 like to see what Mr. Collery said. 20 MS. MACKEY: The reason I ask is that as you 21 22 Certainly. will see if you look at Exhibit 5 there 23 (indicating). 24 MR. NESBITT: Yes. 25 MS. MACKEY: Certainly money came out of that account. 26 27 MR. NESBITT: Yes. 28 MS. MACKEY: In 1993. 29 1 2 I think there is a £10,000. 3 debits you are talking about? 4 MS. MACKEY: Yes. 5 MR. NESBITT: Indeed. 6 MS. MACKEY: And indeed money went in. 7 MR. NESBITT: Yes, and money came in 8 9 Are those the two and in fact if you turn back the page, to the previous page, you have got 10 £360,000 going in in 1993. 11 MS. MACKEY: Yes. 12 MR. NESBITT: You have got £790,000 13 odd going in twice 14 in 1993. 15 MS. MACKEY: Yes. 16 MR. NESBITT: You have got a little 17 bit coming out. You 18 have got an accrual of interest. 19 I would say about that is that if a trust fund 20 was established and it was under active management 21 money could come in and money come out. 22 does not tell you anything about my client. 23 just says, 24 There was people managing it. 25 in a position to talk about that. as is indicated, The only thing So, that It there was a trust. Mr. Benjamin is 26 27 However, 28 dealing in the trust fund assets and my client 29 knows nothing of those and this it tells you no more than somebody was (indicating), 1 as I have said, 2 knows anything of those. 3 unremarkable. 4 where people deal in the trust. is nothing that tells you she So, I just find that It is a trust fund established 5 6 I mean I do not want to guess but it had occurred 7 to me that if you see a credit of £700,000 odd 8 coming in that could well be the realisation of 9 some money that had been held on deposit somewhere 10 else, who knows. 11 the matter further than that. I do not know and I cannot put 12 13 However, 14 I am seeking to deal with what was that my client 15 said things to suggest she believed that the money 16 she had received was from the trust and I think if 17 you go back over the transcript it is difficult to 18 always follow every thread of what people are 19 talking about. 20 have been anything that Mr. Traynor had his hands 21 on. the problem I have at the moment and that The concept of trust appears to 22 23 If Mr. Benjamin is to be believed the trust 24 established by the late Captain Rogers was not 25 the source of the money that we see on foot of 26 Exhibit 2 and I am here to explain that to you, 27 one by Mr. Benjamin's declaration, 28 the evidence that my client is about to give as 29 to somebody, Mr. Traynor, and two by could have had money 1 that would have been paid to her and whatever 2 it means is whatever it means. 3 4 I think the one thing it does not mean is that the 5 trust, what I would call the Cayman trust for 6 shorthand, 7 or paid money out of or had any active involvement 8 in at all because here is what she got and it is 9 now explicable from another source and to suggest was a trust that she paid money into 10 it came out of Cayman trust means that you have 11 got to say that Mr. Benjamin's statement is entirely 12 untrue and I doubt that is something that is logical 13 or rational to say. 14 15 I do not know if the Tribunal has ever dealt 16 with Mr. Benjamin or had any other information 17 from him. 18 in the preliminary conclusion but I do say that 19 I have not seen what Mr. Collery said and I would 20 be anxious to see that if something is going to 21 be drawn from it that went outside what I am 22 suggesting is the position at the moment. I can only look at what we have got 23 24 So, 25 general presentation of the position we wish to 26 put before you I would propose asking Mrs. Rogers 27 now to give her evidence to deal with these things. 28 MS. MACKEY: 29 subject to any questions you have on the Certainly. Thank you. 1 2 3 MS. MACKEY: Yes, y e s . 4 MR. NESBITT: So, 5 I am not sure if you require to have 6 her sworn again. 7 MS. MACKEY: No, that is not necessary. 8 MR. NESBITT: Okay. 9 10 MRS. SONIA ROGERS, 11 WAS EXAMINED AS FOLLOWS BY MR. NESBITT: HAVING BEEN PREVIOUSLY SWORN, 12 13 14 1 Q. MR. NESBITT: So, you are still under 15 oath Mrs. Rogers? 16 A. 17 2 Q. Yes. I want you to revisit a number of matters that you 18 gave evidence about the last time just to put in 19 context what I am going to ask you about. 20 husband was dying of leukaemia towards the end, 21 is that not right? 22 A. 23 3 Q. 24 That is true, Your yes. And he knew he was going to die and he had been arranging his affairs accordingly? 25 A. 26 4 Q. That is true. I think it was after his death that you 27 first learned that a trust had been established 28 somewhere to benefit you and the children, 29 that not right? is 1 2 5 Q 3 I think it was Desmond Traynor who was the source of that piece of information? 4 A 5 6 Q That is true. I think in relation to that trust you learned 6 that the trust was going to be operating its 7 affairs through companies that bore the Ascot 8 name, that is right? 9 A 10 7 Q 11 A 12 8 Q Yes, that is what he said to me. And you have given evidence about that? Yes . In relation to Ascot I think Ascot actually 13 dealt with your stud business after your 14 husband's death? 15 A 16 9 Q That is true. Insofar as you were running a business concerning 17 horses after your husband's death what did Ascot 18 do? 19 A 20 10 Q 21 A 22 11 Q 23 What sort of trade did Ascot do with you? They traded in stallion shares. Very good? Horses in training a nd. . . (INTERJECTION). So, Ascot as far as you were concerned owned stallion shares in horses, 24 A 25 12 Q 26 A 27 13 Q 28 A 29 14 Q is that right? That is it. N o w . . . (INTERJECTION)? We acted as agent for them. Agent for them? Yes . Were there horses on any property that you were 23 1 2 3 15 Q. 4 A. 5 No, no, not on -- no, they weren't on -- there were shares on the property. 6 16 Q. 7 A. 8 17 Q. 9 A. 10 18 Q. 11 A. 12 19 Q. Okay? B u t ... (INTERJECTION) . Very good. So, they owned shares in stallions? That is it. Those stallions were on your property? That is it. And did you receive any return from Ascot for looking after those? 13 14 A. 15 20 Q. 16 A. 17 Yes. The stallions in which the shares were? Yes, but they were charged everything. charged keep. 18 21 Q. 19 A. They were They were charged insurance. Yes? And it was that we just acted as agent for them like any other. 20 21 22 Q. 22 A. 23 23 Q. 24 A. 25 26 24 Q. 27 A. 28 25 Q. 29 A n d . . . (INTERJECTION)? Very good. How did you get paid by them? What do you mean 'how did I get paid by them'? Were you given stallion shares from Ascot? Yes. MR. O'SHEA: Nominations. MR. NESBITT: Nominations, It is nominations, sorry? yes. And that is the ability to sell a nomination 1 2 3 A. 4 27 Q. 5 Yes. So, the business you ran was enjoying the cash from these nominations? 6 A. 7 28 Q. 8 Yes, but they were also charging everything else. Yes. So, you would set off what you earned against the liabilities of Ascot? 9 A. 10 29 Q. 11 A. 12 30 Q. 13 A. 14 31 Q. Yes. And you made a profit after that? Yes, very little actually. Very little? Yes. I think you said on the last occasion that the 15 business that you did concerning Ascot shares 16 was a small portion of the overall business 17 you did? 18 A. 19 32 Q. Oh, yes, it was minimal. Very good. In relation to the business of trading 20 in stallion shares you took over your husband's 21 business in 1984? 22 A. 23 33 Q. 24 A. 26 34 Q. 27 29 And you then worked on with what you had thereafter, is that not right? 25 28 Yes. Yes. And what happened in the market place to stallion shares? A. No. Did they remain good business? Well, no, because we had a recession just after he died and everything dropped. 1 35 Q. 2 A. 3 4 36 Q. A. And are you aware of what Ascot did with the Well, they -- I think they sold most of them or they died or they -- it was the end of the them. 37 Q. 9 Were you involved in paying over the proceeds of sale of any of the shares that Ascot held? 10 11 a completely different end stallion shares it had? 7 8 And I moved into mares, of it, and gradually got out of the stallions. 5 6 What did you do? Did you sell any of the shares for them? A. 12 You have already got the accounts. Yes, I think so. The accounts.. . (INTERJECTION). 13 38 Q. 14 A. 15 39 Q. 16 Where would the m o n e y ...(INTERJECTION)? The accounts are all there. Well, if you received money for the sale of Ascot shares where would the money have been sent to? 17 A. 18 40 Q. 19 A. 20 41 Q. 21 A. 22 42 Q. They would have been sent back. To whom? To Ascot. Yes. Via whom? Via Mr. Traynor. Very good. I think a number of years after your 23 husband's death had you made any investments in 24 assurance policies or anything like that? 25 A. Yes, I had my own private stallion shares and 26 I had built up a book folio of my own. 27 invested that in -- I wanted to diversify a bit. 28 43 Q. 29 A. So, I Yes? So, I invested in various bonds and standard lifes 1 2 44 Q 3 A 4 5 Did those bonds get paid back to you in due course? Yes, when they matured. years. 45 Q They were over so many They were different. Very good. Did you ever have occasion to deal 6 with Mr. Desmond Traynor in relation to any of 7 the returns from those investment bonds? 8 A 9 Yes, because I had these two cheques which matured from two of these. 10 46 Q 11 A Yes ? I don't know whether they were standard lifes or 12 what they were and those were the two cheques that 13 I gave to Mr. Traynor. 14 47 Q We will just take it slowly. Could you indicate 15 to the Inspectors what value you believe the two 16 cheques equated to? 17 A Well, I think they came to £151,000 or approximately 18 that. 19 other was £48,000. 20 48 Q 21 22 One was one hundred and something and the I mean I am talking approximate. Do you remember roughly when you would have had these cheques in your hand to do something with? A 23 I think they were 1988 or something, were they? About t h a t . 24 49 Q 25 A 26 Yes ? I think one was the end of 1987 and one was 1988 but they were about then any way. 27 50 Q 28 A 29 51 Q Very good? That sort of time. 1 2 52 Q. 3 4 So, you had these cheques and what did you do with them? A. Well, I took them to Mr. Traynor because I actually 5 -- at that point I had a child with problems, 6 learning problems and so I had found a school 7 in America which I thought he could go to and 8 I gave them to Mr. Traynor. 9 to Mr. Traynor when I saw him somewhere and he I had explained this 10 said, 11 invest them for you," and so I gave them to him. 12 53 Q. Okay. "Well, why not give them to me and I will Now, if we could just briefly deal with 13 your child? 14 well in the educational system, 15 A. 16 54 Q. 17 I think you had a son who had not fared Yes, that was for him. is that right? That is what I wanted. And he had been suffering from some form of dyslexia? 18 A. 19 55 Q. 20 A. 21 56 Q. Yes. Is that right? That is true. And at that point in time, in 1988 thereafter, 22 I think he was still resistant about any need 23 to have further education? 24 A. 25 want to do it. 26 57 Q. 27 A. A n d . . . (INTERJECTION)? So, he did all sorts of other jobs and the money stayed with Mr. Traynor. 28 29 Yes, he was being very difficult and he didn't 58 Q. Very good. I think his educational problems 1 2 3 59 Q. 4 for that, 5 A. 6 60 Q. 7 is that right? Yes, because he inherited some money later on. Yes. I think some of the property that was being held on trust to be sold was sold? 8 A. 9 61 Q. 10 A. 11 12 You did not have to dip into your money to pay Yes. And he received a very substantial payout from that? So, he could afford to pay for his own education at that po i n t . 62 Q. 13 Yes. I think he received sums in excess of £lm, is that right? 14 A. 15 63 Q. 16 A. Yes. I think he is now in America, is that right? He has been in America -- he works in America now 17 and he went to America and he actually was cured 18 and he got his BA, he got his MA, 19 working. So, it was a success story in the end. Alright. He had difficulty with his dyslexia. 20 64 Q. 21 22 and he is now He had remedial teaching a n d ...(INTERJECTION)? A. Oh, yes, he was very very bad. They said he was 23 the worse case they had ever seen and he would 24 never pass an exam. 25 65 Q. Okay. So, it was a success story. Coming back to Mr. Traynor: You had given 26 money to Mr. Traynor and he was going to do what 27 with it for you? 28 A. 29 66 Q. He was going to invest it for me. Okay? 1 But it was eventually -- I presumed he was going 2 to pay the school fees until it all changed. 3 When you were here on the last occasion you were 4 asked about getting money from the trust that your 5 husband established. 6 since that would assist you in throwing any further 7 light on whether or not you received money from 8 the trust that your husband established? 9 A Well, Have you learned anything I thought when I was here before that this 10 money for - that I took back in tranches — 11 are talking about that, 12 68 Q 13 A 14 69 Q 15 A 16 17 are you? Yes ? The number I got back from him. Yes? I thought, when I was here before, it came out of "the trust" for want of a better word. 70 Q Now, I want to be very careful so we all talk 18 the same language. 19 with inverted commas? 20 A 21 71 Q 22 23 you When you say "the trust" Or I mean the Cayman...(INTERJECTION). You are talking about the one your husband established shortly before his death? A I am talking about the Cayman trust or whatever you 24 -- I thought it came out of that and it wasn't until 25 -- I think Padraig Collery told us it came out of 26 that. 27 it originally -- I think my solicitor thought it 28 came out of that and he told me but any way I 29 thought it came out of that and then it wasn't I don't know. I think that is probably how 1 until I made contact with Barry Benjamin who I 2 was -- because I was trying to get a Trust Deed. 3 I mean I had nothing to prove there was a trust 4 and you had asked me for that. 5 nothing and I contacted him a few times and he 6 couldn't find anything and eventually I asked him 7 about this and he said in no way had I ever taken 8 any money out and that this money was kept 9 completely separately. 10 72 Q. 11 Very good. Now, I had absolutely I just want to be certain we are talking about the same thing? 12 A. 13 73 Q. Okay. On the last occasion you give evidence you handed 14 in a handwritten document, 15 (indicating)? 16 A. 17 74 Q. which you can see Yes. To identify it for the transcript it is Exhibit 2 18 to the preliminary conclusions of the Inspectors 19 as they currently stand. 20 the list of money that you received back after 21 m a ki ng ...(INTERJECTION)? 22 A. Was that (indicating) Yes, that was the money that I -- later on when 23 I went to see Mr. Traynor I knew that my son 24 didn't need the money any more because he had got 25 his own inheritance as I have explained to you I 26 said to Mr. Traynor that I needed -- he said, "How 27 is everything," as he always said and I said, "Oh, 28 fine, but I am doing up a house that I have moved 29 into. I have just built some flats and I am 1 furnishing them. 2 and I have not -- I am short of money for this 3 job," and he said, 4 You can have back some money out of -- you know, 5 I will give you some money," and I never asked 6 where it came from. 7 75 Q. This is all with my own money "Well, that is no problem. I think Mr. Traynor died around 1994/1995. I do not know if you remember that? 8 9 A. 10 76 Q. 11 A. 12 77 Q. 13 A. Yes, 14 78 Q. Yes? 15 A. 16 Yes. Did you deal with somebody else after that? I dealt with Mr. Collery actually. Mr. Collery? I mean I had these tranches at different times. I can't remember what dates they were. What are the dates of them? 17 79 Q. 18 A. 19 80 Q. Do not worry about the dates at the moment? Okay. Very good. Do you have any explanation as to 20 where Mr. Traynor, 21 have got money to pay you back if Mr. Benjamin's 22 account of the trust fund having remained in 23 tact is correct? 24 A. 25 81 Q. 26 could I have no idea where it came from. Yes. Had you given him any other money besides the two cheques that you have described? 27 A. 28 82 Q. 29 or later Mr. Collery, No. And that is the extent to the best of your 1 2 3 83 Q. Very good. Have you received any of the money 4 or any money from the trust in the Cayman Islands 5 to the best of your understanding or belief? 6 A. 7 84 Q. No. Good. Okay. 8 9 END OF EXAMINATION OF MS. ROGERS BY MR. NESBITT 10 11 12 MR. NESBITT: 13 That is the evidence that I propose leading subject 14 to any questions you have of my client. 15 MS. MACKEY: 16 Thank you very much. Well, I think what we 17 will do is we will take a short break. 18 invite you to have a cup of tea or coffee and 19 Mr. Rowan and I will come back to you in about 20 ten m i nu te s. 21 MR. NESBITT: That is grand. 22 MS. MACKEY: Thank you very much. 23 24 25 26 27 28 29 SHORT ADJOURNMENT We would Thank you. 1 2 ADJOURNMENT: 3 4 5 MS. MACKEY: 6 Very well. We have furnished you with a 7 copy of Mr. Collery's evidence in relation to 8 M r s . Rogers and have you had a chance to look 9 at that? 10 MR. NESBITT: 11 We had the opportunity of looking at it, yes. 12 MS. MACKEY: Yes. 13 MR. NESBITT: And I suppose all we 14 can say is this: It 15 appears to be a bit tentative at best. 16 MS. MACKEY: Yes. 17 MR. NESBITT: And now we have the 18 Barry Benjamin evidence. 19 MS. MACKEY: Yes. 20 MR. NESBITT: It must be wrong. 21 MS. MACKEY: That you say Mr. Collery's 22 evidence is possibly wrong 23 in the light of Mr. Barry Benjamin? 24 MR. NESBITT: It must be wrong. 25 MS. MACKEY: Yes. 26 MR. NESBITT: If Mr. Benjamin is 27 28 29 correct. 1 2 M R S . ROGERS: 3 MS. MACKEY: You have the right 4 and indeed we would 5 be very happy for you to cross-examine Mr. Collery 6 on his evidence. 7 into account with your legal advisors. 8 consider that matter. 9 we would like you to let us know as soon as That is a matter for you to take You can If you do wish to do that 10 possible. 11 MR. NESBITT: Yes. 12 MS. MACKEY: Because Mr. Collery will be making himself 13 14 available I think for cross-examination to a number 15 of people. 16 MR. NESBITT: Yes. 17 MS. MACKEY: And we would like to, 18 insofar as possible, 19 try and fit all of those in around the same time. 20 MR. NESBITT: Okay. 21 MS. MACKEY: Also because we are 22 near the end of 23 o u r . . . (INTERJECTION). 24 MR. NESBITT: 25 I have read your list 26 of procedures. 27 MS. MACKEY: 28 29 Well, we will certainly Yes . We will certainly 1 MS. MACKEY: 2 MR. NESBITT: And what you respectfully ask is: 3 "Do we wish to do 4 that ?" 5 MS. MACKEY: Yes. 6 MR. NESBITT: If we do there is the 7 opportunity if you move. 8 MS. MACKEY: Absolutely 9 MR. NESBITT: Very good. MS. MACKEY: We would like if you 10 could inform us of 11 12 your decision about that within a week. 13 MR. NESBITT: Very good. 14 M S . M A C KE Y: Thank you very much. 15 MR. NESBITT: Okay. much. 16 17 Thank you very M R S . ROGERS: Thank you very much indeed. 18 19 MR. O'SHEA: Thank you. 20 MS. MACKEY: That is fine. you very much for 21 22 coming in. 23 M R S . ROGERS: 24 Thank you, Mrs. Rogers. Thank you very much indeed. 25 26 27 28 29 Thank THE EXAMINATION THEN CONCLUDED. s o l i c i t o r s 20 N O R T H U M B E R L A N D R O A D D U BLIN 4 T EL 660 ‘)7W FAX 660 9434 EM A IL: inl'o(« km b.ie w w w .km b.ie O ffice o f the Inspectors appointed by OrRer ' o f the H igh Court to Ansbacher (Cayman) Limited 3rd Floor Your ref: C /R 03/N SPM Our ref: M O ’S/D F Co Dublin 4 April 2002 Re: Mrs Sonia Rogers Dear Inspectors, W e refer to the transcript o f our client’s evidence to you on 15 January 2002. W e w ould appreciate i f you could note the follow ing corrections and com m ents:1. Our client is represented by K ennedy M cG onagle Ballagh, 20 Northumberland Road, Dublin 4 not M ichael O ’Shea & Company, 291 T em pleogue Road, Dublin 6W. 2. There are a few minor errors in part o f Mr. N esbitt’s statement that our client b elieves should be corrected. (a) On Page 10 he states that the two investm ents referred to had been invested after her late husband’s death. This is not correct, these investm ents were made before her husband’s death. (b) On line 10 on the same Page, 1998 should be 1988 (as is evident from line 11). (c) A lso in the same paragraph it is not correct to say that she gave the funds to Mr. Traynor to manage for her but rather the funds w ere given to Mr. Traynor to provide for the education o f her son, John. (d) In the third paragraph on Page 10 it is not correct to say that she always believed that the m oney w as probably put into the trust. The reality is that at the tim e she did not know. (e) On Page 15, our client states that so far as she is aware there is nothing outstanding contrary to Mr. N esbitt’s statement that som e m oney would still be ow in g (lines 10 and 11). MieiiAhi j.c/siika rcx;i:r p.baij.aorix)n judgiassisiams: FIONA ihnry acjatha to. TAYLOR toNst'i.rwis: i.amki-no. r.hrankiAN mariina i.o'oorman COMMISSIONERS TOR OA1IIS /KOIARIIS IHUUC M em ber o f the Association o f Independent European Law yers. 3. Finally, som e answers o f our client on Page 24 are not w h olly correct. The correct answer to question 18 w as that not all stallions were on our clien t’s property. In other words the com pany held shares in stallions, som e o f w hich did not stand on our client’s property. A gain the answer to question 23 on the sam e page could more fully be replied to as follow s:“That the nom inations w ere either used by A scot or w ere sold for A scot.” A irlie Stud received keep fees and w as paid com m ission on sales o f bloodstock by A scot. The sale o f stallion nom inations were not paid to A irlie Stud but were credited to A scot’s account and this is touched upon at question 25. W hile w e appreciate that none o f the above are particularly material our client is nevertheless m ost anxious that the full and correct facts are available to you. Y ou m ight let us know w hen it w ill suit for our client to call to sign the transcript. Yours sincerely, M ichael O ’Shea K ennedy M cG onagle Ballagh S () L I € I T O It S ' 20 N O R T IIU iM H E R lA N I) ROAD D U B LIN 4 TKL 660 9799 l-AX 660 9434 EM A IL : in Ibfrtkm b. ie ' w w w .k m b .ic Office of the Inspectors appointed by O r idler7J o M i § High Court to Ansbacher (Cayman) Limited Your ref: C / R 0 3 / N S P M Ou r ref: M O ’S/DF 3rd Floor Trident House Blackrock C o Dublin 21 December 2001 Re: Mrs Sonia Rogers Dear Sirs W e refer to your letter dated 3 December regarding your preliminary conclusions relating to M r s Sonia Rogers. W e wish to state that your preliminary conclusions and certain statements relating to M r s Rogers’ conduct are incorrect. In particular, M r s Rogers was not a client of Ansbacher C a y m a n Limited, had no relationship with Ansbacher C a y m a n Limited and gave no instructions to Ansbacher C a y m a n Limited. Y o u r statement that M r s Rogers conducted lodgments to and withdrawals from the trust fund established by the late Captain T i m Rogers is incorrect - F r o m information recently confirmed to Mrs. Rogers she n o w kno w s that no lodgements/withdrawals to/from the Trust were made. Y o u r statement that M r s Rogers was the beneficial owner of the funds in Ansbacher is incorrect. T h e funds are controlled by the Trustees and not by M r s Rogers and w e believe that, w h e n you consider our statements below, you will accept that this statement is correct. A s a consequence of the above points, w e believe your preliminary conclusions are fundamentally flawed and consequently, the excerpts from your preliminary report should be a m e nded accordingly. It is apparent to our client, following a consideration of the transcript of her evidence, that M r Justice Costello and herself were at cross purposes for a good deal of the examination. W e wish to m a k e it clear that there w a s never an intention on M r s Rogers’ part to mislead M r Justice Costello and any contribution she m a d e to the confusion was entirely innocent. A s a result of our ongoing enquiries and our attempt to determine the nature of the Captain Rogers C a y m a n Trust, w e have received from Barry Benjamin a draft affidavit in which he sets out the nature and facts relating to this Trust. H e states inter alia that: (i) N o additional capital has been contributed to the Trust since its inception save that contributed by Captain Rogers immediately after the creation of the Trust; (ii) N o appointments have been m a d e by the Trustees from the Trust and no m e m b e r of the family of Captain Rogers have been in receipt of any loans or advances from the Trust. M r s Rogers’ Airlie Stud had a normal commercial arrangement with a co m p a n y called Ascot Holdings Limited, which subsequently became Ascot Ventures Limited. This business w a s conducted in the normal w a y as with any other client for w h o m she w a s providing bloodstock services. M r s Rogers was aware of the connection between Ascot Holdings Limited, subsequently Ascot Ventures Limited, and the Trust established b y her late husband. A n y payments or lodgments she m a d e on behalf of Ascot Holdings Limited, subsequently Ascot Ventures Limited, were m a d e to that c o m p a n y and not to the Trustees. It should be pointed out to avoid any confusion in the transcript of her examination that the quantum of trade with Ascot was very small compared to the quantum of trade of Airlie Stud. Mrs Rogers Education Account W e wish to advise that M r s Rogers gave the proceeds of two insurance policies to M r D e s Traynor in 1988 the purpose of which was to fund the education of her son, John, in the United States. John had special education needs and she wished h im to attend a special school in the United States and set aside the proceeds of two insurance policies to fund this. A s it happened, she could not persuade her son to attend the school at the time, although he subsequently did w h e n he w as a good deal older. T h e s u m involved was £151,158, paid in two amounts, which M r Traynor said he would m a n a g e for her. M r s Rogers had no knowledge of where M r Traynor lodged the funds. A s the funds ultimately were not required for education purposes for her son John, various amounts over the years were repaid to Mr s Rogers, some of which were used on renovations in Grangewilliam. These amounts are the amounts set out Q -3­ '' *’ r . in Exhibit 2 to your preliminary conclusions and represent the full amount of the payments m a d e to Mrs. Rogers from this source. It is n o w clear from the declaration of Mr. Benjamin that these payments to Mrs. Rogers were the repayment of the two amounts given by her to Mr. Traynor and that they were never part of the Captain Rogers C a y m a n Trust. M r s Rogers has provided all relevant information relating to these payments to the Revenue Commissioners and all tax relating to the income accruing on the payments have been returned, fully paid and discharged. Exhibits In relation to the other exhibits attached to your preliminary conclusions, w e draw your attention to the following: E x h ib it 3 W e have no knowledge of this payment and indeed the copy with which w e have been furnished is illegible. O u r client has no knowledge, m e m o r y or light to shed on this cheque which incidentally is dated 8 April 1992 and not 1982 as stated in your list of exhibits. Please furnish us with the original cheque or a clearly legible copy. E x h ib it 4 M r s Rogers has no knowledge relating to the credit of £360,366.15 shown in this document headed “Statement of Account”. E x h ib it 5 M r s Rogers has no knowledge of the two credits of £798,683.40 shown in the document headed “Statement of Account” at exhibit 5. E x h ib it 6 M r s Rogers has no knowledge of the debits and credits s h o w n in the document headed “Hamilton Ross”. A s is apparent from the above, the preliminary conclusions relating to Mrs Sonia Rogers are incorrect in certain important and fundamental respects. In particular, Mrs Rogers is not a client o f Ansbacher, she did not conduct any lodgments or withdrawals to or from the Cayman Trust established by her late husband, nor is she the Beneficial owner of the funds in that trust. A s the statements are adverse to our client’s interests, w e call upon you to a m e n d your report to delete all reference to the above matters. W e further call upon you, in accordance with Appendix C attached to your letter dated 28 M a r c h 2000 setting out the procedures to be adopted by the Inspectors, that you inform us in writing of your revised preliminary findings following consideration of the above matters and that our client be afforded, by w a y of examination on oath, an opportunity to address the Inspectors in accordance with Appendix D Appendix in relation to any of the matters referred to above. of the said It is hoped that such a further examination would be conducted in a m u c h more courteous manner. The examination before Mr. Justice Costello was conducted in a hostile and aggressive manner and Mrs. Rogers w a s interrupted continuously, as the transcript will show. T his experience caused her considerable distress. W e await hearing from you. Yours faithfully K e n n e d y McCJonagle Ballagh A F FID A V IT ' 1. I am the President o f Western International Trust Company Limited (“Western"), a Cayman Islands com pany licensed to carry on the business o f com panv management and the provision o f trustee and related services. Z. A ll the issued shares in A sco t. Ventures Limited (“Ascot"), a Cayman Islands company, were registered in the name o f Western. 3. '• ' $tr. John A . Furze the original trustee, was holding such shares in Ascot as a discretionary trustee o f funds.provided by the late Captain A.D.D. Rogers (Tim Rogers), 4. In accordance with the poiicics o f Western, Ascot was dissolved in 2000 and the assets were transferred to a newly incorporated Cayman company called Rainy Day Ltd. (“ Rainy Day”). All the issued shares in Rainy Day arc held by Western as trustee. 5. To the best o f m y information, knowledge and b elief - and following a search o f the records in m y possession. a) No additional capital has been contributed to the said trust since its inception save those funds contributed by Capt. Rogers immediately after the creation o f the trust. b) The Declaration o f Trust establishing the said trust and ictter o f wishes cannot, after a thorough search, be found and are presumed to have been lost. c) Mr. John A. Furze M.B.E. w as ihe original trustee o f the said trust and that trusteeship passed to Western on his death. d) The said trust has funds on deposit through Rainy Day. e) No appointments or loans have been made from the said trust to any member o f Capt. Rogers’ family, rior to any other person or entity. SWORN A N D SUBSCRIBED TO By BARRY B. BENJAMIN President o f WESTERN INTERNATIONAL TRUST COMPANY LIMITED this day o f in the pruscncc o f: ) : ) ; 200 ____ ___ ) : ) Notary Public, Cayman Islands My C’uninussion expires Junuiiry J 1.2002 BA RR Y B. BENJAMIN UNDER OATH ON TUESDAY, 11TH JANUARY 2000 I hereby certify the following to be a true and accurate transcript o£ my ' shorthand notes in the above named interview. ■ fe tg iC lL B s Stenographer G W EN M A L O N E — STENOGRAPHY SERVICES L T D .= LAW LIBRARY,P.O.BOX5939, 145-151 CHURCH STREET,DUBLIN7. TEL:(01)8782000/8782033. FAX:(01)8782058. MOBILE:0872491314. AFTERHOURS:287 1380. 2 3 4 5 253 Q. 6 7 A. 8 Q 9 Ascot Ventures, I believe there is a trust and the 10 person who has received a distribution out of that 11 trust is Ms. Sonia Rogers^ 12 13 14 15 254 Q. 255 C 16 17 18 19 20 21 22 23 24 25 26 27 28 29 2 3 4 5 es 6 7 8 9 10 11 12 13 14 26 15 16 17 18 19 20 1^1 21 made payments to Mrs. Kay 22 Mason, but I believe they were collected on behalf 23 of Mrs. Rogers, I think is the name, who in turn is 24 connected with Ascot Ventures. 25 name is there. 26 263 27 Q. Payments from A/A3, who was ... (INTERJECTION) . A. A/A3 is Ascot, or the funds that are held on behalf of Ascot by a company called Ascot Ventures. 28 . 29 That is why that 264 Q. To Mrs. Rogers? I believe Ascot -- and, again, it is very sketchy information, but I believe Ascot Ventures was a 3 bloodstock company which traded in the States and in 4 Australia and it had a direct relationship with 5 Ansbacher Cayman, and funds were transferred. 6 believe, had stock with Airlie Stud and these were 7 payments for fees, etc, services rendered through 8 ^ 265 10 11 12 13 14 15 16 17 A8 19 20 21 22 23 24 25 26 27 28 266 It, I UNDER OATH ON FRIDAY, 8TH MARCH 2002 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MS. MACKEY BL M R . ROWAN M R . ROWAN MR. M. CUSH SC Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MR. COLLERY Represented by: MR. JERRY SHEEHAN SHEEHAN & CO. SOLICITORS On Behalf Of Sonia Rogers: RICHARD LAW NESBITT SC Instructed by: MICHAEL O'SHEA KENNEDY McGONAGLE BALLAGH SOLICITORS WITNESS MR. P. MR. P. MR. P. COLLERY COLLERY COLLERY I EXAMINATION MR. NESBITT MS. MACKEY MR. SHEEHAN PAGE 1 2 3 MS. MACKEY: 4 Good morning, everybody perhaps the best thing to 5 do would be if the legal advisors on each side would 6 introduce themselves for the record and Mr. Collery 7 is on Oath already so he will not have to take the 8 Oath again. 9 A. 10 1 Q. Is that okay, Mr. Collery. Yes. I do not know how you wish to proceed with this 11 whether anybody wants to make an opening statement, 12 Mr. Nesbitt? 13 MR. NESBITT: 14 I will explain. I appear for Sonia Rogers 15 instructed by Kennedy McGonagle Ballagh. 16 we are here today is on the last occasion we were 17 dealing with the affairs of Mrs. Rogers. 18 arose as to certain evidence that had been given by 19 Mr. Collery at an earlier stage. 20 with extracts from the transcript of evidence he 21 gave, 22 January, 23 provided us with an extract from a series of pages, 24 not complete, but some parts of what appeared on the 25 pages. 26 You gave us lines 21 through to 29 on page 64 and 27 lines 1 through to 8 on page 65. 28 that evidence because it was suggested as being 29 evidence that contradicted, possibly, The reason An issue You provided us I am not sure of the exact date, sorry, 2000 was the date of the evidence. 11th You You gave us lines 9, 10 and 11 on page 59. We were pointed to the contents 1 of an affidavit we produced from a Mr. Barry 2 Benjamin concerning whether or not monies that were 3 said to have been received by Mrs. Rogers came out 4 of a trust that was abroad. 5 ask Mr. Collery things about this to see if it might 6 cast any more light on what the position might have 7 been and, 8 views Mr. Collery's representative has or Mr. 9 Collery has. 10 MR. SHEEHAN: so, We asked if we could I am here to to that subject to any 11 I am Jerry Sheehan of Sheehan & Co, Solicitors. 12 I have been with you before. 13 Mr. Collery and have always adopted the attitude of 14 giving whatever assistance we can, 15 we are happy to be here today to assist in this 16 further enquiry. 17 forewarning of what the issues are so you will have 18 to bear with us if there is any delay in dealing 19 with the ma t t e r s . 20 MS. MACKEY: 21 22 23 24 25 26 27 28 29 I represent Inspectors, and We have had little or no Thank you very much, Mr. Collery for coming and, perhaps, Mr. Nesbitt you would like to begin. 1 2 MR. NEXBITT: 3 4 MR. NESBITT: Very good, 5 the first thing if I could ask for Mr. 6 Collery to be given a copy of the transcript I want 7 to ask him questions about it and that might make it 8 easier for him. 9 MS. MACKEY: The transcript of his own 10 evidence. 11 MR. NESBITT: His own evidence, 12 MS. MACKEY: Which day. 13 MR. NESBITT: The 11th of January 2000, 14 page 64. yes. Now, Mr. 15 Collery, 16 and help you, 17 for Sonia Rogers and an issue that has arisen 18 between Mrs. Rogers and the inspectors is whether or 19 not certain payments of money that it is said she 20 receives were paid out of a trust that had been 21 established by her husband or, possibly, 22 some other source. 23 has been suggested that certain evidence you gave on 24 the 11th January, 25 payments and the possible source of the money. 26 just want to bring you through the little bits 27 I have to see if we can tease out this issue a 28 little bit further. 29 that you made payments to Mrs. Kay Mason and you just to set my questions in context to try as you have heard already, I appear came from I will come back to that but, it 2000 was material to the fact of I You said on page 64, line 21 1 2 Rogers. 3 name who is in turn connected with Ascot Ventures. 4 That is why the name is there." 5 payments were from A/A3. 6 little bit about that. 7 the Inspectors probably know, when you use the 8 phrase 9 A. I think you also say," ... I think is the You say the I just wanted to ask you a Could you explain to me, and 'A/A3' what are you intending to refer to? I think we would have in front of us at that 10 juncture copies of what we commonly refer to as a 11 memorandum account. 12 of that. 13 MS. MACKEY: Will I go into the explanation Whatever way Mr. Nesbitt 14 wants you to proceed, Mr. 15 Collery. 16 MR. NESBITT: Yes, the memorandum 17 18 account. A. A memorandum account was a split down or the 19 memorandum system was a method by which Hamilton 20 Ross, 21 company of John Furze's, 22 deposit with Guinness & Mahon and or Irish 23 Intercontinental Bank. 24 there of a sum of X. 25 break down of accounting for the totality of that 26 sum of X. 27 then it would be indicated when Mr. Traynor was 28 alive as to where that payment should come from. 29 merely carried on that on behalf of Mr. John Furze I think, as we were talking here who was a a Cayman company had a It would not say one deposit The memorandum system had the When payment was made to an individual I 1 when Mr. Traynor died. 2 we were referring to here those are payments that 3 were made to Mrs. Mason and I believe were 4 ultimately to Mrs. Rogers came out of an account 5 entitled A/A3. 6 2 Q. 7 8 this memorandum account, that was something maintained in this jurisdiction, A. 9 is that right? It was a memorandum of events over an account which companies in 10 11 Now, In the case of payments that Cayman would have had with Hamilton Ross . 3 Q. In sort of simplistic terms it was a record you were 12 keeping in this jurisdiction of what was happening 13 on an account somewhere else, 14 A. 15 16 is that right? It was a record of a sum of monies which was held somewhere else. 4 Q. Very good, now, I want to talk about the sum of 17 monies that were held somewhere else because if you 18 see a record of an event taking place in the 19 memorandum account am I right in thinking that means 20 that if money was paid out it came out of the 21 account somewhere else, 22 A. is that right? What happened with the transactions were that these 23 statements of these accounts were transferred back 24 to Cayman and then John Furze would have, 25 would have posted those transactions in his books in 26 Caym an . 27 5 Q. Now, I presume, as I understand the arrangements that are under 28 investigation here you only appear for a short 29 period of history after Mr. Traynor dropped out of 1 2 A. 3 4 I would only have had direct relationships for a short period, 6 Q. that is correct. What I wanted to find out about the account that 5 existed in Hamilton Ross or wherever that appears to 6 be in some way connected to the memorandum account. 7 Are you in a position to throw any light as to what 8 might be the source of funds for that account? 9 A. 10 11 Ni, because it would have happened way beyond my time . 7 Q. In those circumstances are you aware whether or not 12 it is possible there might be a number of sources of 13 funds that would be in the offshore account, 14 can give it that phrase? 15 A. 16 17 8 Q. I want you to just look at something that we have obtained. A. Do you know a Barry Benjamin? Yes, he was Mr. Furze's partner in the trust company which they set up in Cayman. 20 21 No, because that detail was not available to me here in Dublin. 18 19 A. What I wanted to show you was a copy of an 22 Affidavit, 23 Benjamin. 24 read that. 25 copy of this, 26 MS. MACKEY: 27 28 29 if I this is the original sworn by Mr. Perhaps you could just take your time and I think the Inspectors has been given a Exhibit (1) We have a copy, you. (EXHIBIT NO. 1 HANDED TO WITNESS) yes, thank 1 read that. Now, just to 2 bring you through that just to let you understand 3 what I understand to be the information contained in 4 there. He says he is President of Western 5 International Trust Company which he calls "Western" 6 and that was, basically, 7 management and trustee services. 8 the issued shares in Ascot Ventures Limited, 9 Cayman Island Company, a business to provide He indicates that a were registered in the name 10 of Western. 11 an original trustee holding the shares in Ascot as a 12 discretionary trustee of the funds for the late 13 Captain Rogers. 14 of Western, Ascot was dissolved in 2000 and the 15 assets were transferred to a newly incorporated 16 Cayman company called, 17 issued shares in Rainy Day are held by Western as 18 trustee. 19 information, 20 matters having searched his records. 21 additional capital had been contributed to the trust 22 since its inception save for those funds contributed 23 by Captain Rogers immediately after the creation of 24 the trust. 25 establishing the said trust and letter of wishes 26 cannot, 27 presumed to have been lost. 28 was the original trustee of the said trust and that 29 trusteeship passed to Western on his death. He makes the point that a Mr. Furze was He says in accordance with policies Rainy Day Limited and all the Then he says to the best of his knowledge and belief the following Secondly, He says: No that the declaration of trust after a thorough search, be found and are He says that Mr. Furze That 1 the trust funds are on deposit through Rainy Day 2 and, 3 or loans have been made from the trust money to any 4 member of Captain Rogers's family nor to any other 5 person or entity. 6 Now, 7 trust was established, money was put into it and 8 there is no record and there are no appointment or 9 loans made out of that trust money. finally, he makes the point that no appointment (READ) I understand what he is saying there is that a If I can just 10 come back to your evidence and if I could ask you 11 to look at page 59 of your transcript. 12 You say there, Ascot Ventures, 13 trust and the person who has received a distribution 14 out of that trust is Mrs. Sonia Rogers. 15 you talk about the Ascot Venture trust there, 16 that the trust that was originally set up by Captain 17 Rogers that you are talking about. 18 A. I believe, there is a Now, when is As I said, who set it up way back I do not know the 19 details. In conversations with Mr. Furze, 20 believed, that A/A3 had an association with a trust 21 and I believe, 22 just conversation that A/A3 was in some way 23 connected to a trust called Ascot Ventures. 24 9 Q. to the best of my knowledge, sketchy or very sketchy, 26 used at page 56 of your evidence? A. from I think you fairly said that your information was 25 27 I Again, I think, was the phrase you I do not have details and why I used 28 'sketchy' 29 when I was talking to Mr. Furze and, therefore, there was that it is word of mouth from I 1 don't have the detail. 2 exhibit 3 detail to 4 10 Q. Something like this now, (l)this is by Barry Benjamin, adds further my knowledge. You would not have been party to what Mr. Benjamin 5 was doing or not doing so you just read what he says 6 as that, 7 A. is that right? Absolutely, and an example of that is, obviously, 8 Ascot Venture no longer exists now and is now Rainy 9 Day and that is something that is totally new to me. 10 11 Q. One of the points that Mrs. Roger has made in the 11 course of giving evidence to this inquiry is that 12 she, having obtained certain monies, 13 £150,000 gave the money to Mr. Traynor. 14 evidence of a source of money going to him. What I 15 want to suggest to you is this, 16 where Mr. Benjamin who appears to be the person in 17 charge of the trust says, 18 established by Captain Rogers has not had its 19 capital affected by an appointment. 20 there might be some other source of money that you 21 see recorded in the memorandum account that is other 22 than the trust monies that were originally put in 23 place by the late Captain Rogers which could be the 24 source of payments to Mrs. Rogers? 25 A. approximately That is in circumstances the original trust It is possible I just want to be clear on what you are putting to 26 me there. 27 possible that A/A3 as a consolidated amount of 28 money could have monies from a trust and monies from 29 other sources which you have just told me about I think what you are saying is, is it 1 2 12 Q. 3 A. That is exactly what I am asking? I would not know how they would treat the split, if 4 they were to split, 5 split of funds in Hamilton Ross and if Hamilton Ross 6 decided to deposit, 7 those funds in one account but in their books have 8 the trust money, 9 accounts, that's possible. 10 function, I presume, which would be carried out by 11 Hamilton Ross as the trustees and or the management 12 company as they are referred to here. 13 13 Q. and there possibly could be a for whatever reason, and other money, all of in separate It is an accounting The reason I am asking this question is because I 14 wanted to see could what Mr. Benjamin have said be 15 accepted as accurate in circumstances where you were 16 still able to give Mrs. Rogers money out of A/A3 in 17 circumstances where the original trust monies were 18 not touched? 19 A. He is the person ultimately responsible for the 20 accounting of the monies and if he has split it down 21 I see it at one stage as A / A 3 . 22 it differently in his books then what he is saying 23 here, 24 Western International books. 25 14 Q. obviously, If he accounts for is what he believes is the case in When you were giving evidence to the Inspectors and 26 the evidence that we see in the transcript that we 27 have been given, was your intention to suggest that 28 the money had to have come out of the trust? 29 1 money coming out of that and, as I have said in my 2 evidence, 3 Ascot. 4 line 1, of my evidence on 11th January, 5 sketchy information because of what I was told by 6 Mr. 7 Cayman and, obviously, 8 information that you now present in front of me. 9 15 Q. I believed that it had an association with That information, Furze. I did not have this Do you want to contradict what was said in Mr. Benjamin's affidavit, 11 (1) • A. 2000 was I did not have evidence of what was in 10 12 as I have said in page 65, that can't be right? Exhibit It is a clarification rather than a contradiction in 13 my belief. 14 and what we now have in front of us is A/A3 15 represented trust funds which still has the 16 relationship with Ascot and funds, Mrs. Rogers has 17 given for another use and that's where those 18 distributions were coming from, 19 trust funds were not the inference here in what is 20 stated there in 5(e) that no appointments were made 21 from the trust proper itself. Exhibit 22 16 Q. I said I have given funds out of A/A3 I believe, and the (1). I want to ask you another question and if you do not 23 know say so. Are you aware of any other accounts 24 that used the designation A/A and a numeral or 25 designations like that that when related to what was 26 out in Cayman would not be made up from a series of 27 sources. 28 fund there. 29 sort of accounts, maybe, In other words, a deposit here, a trust Had you ever seen any evidence of those coming from a series of 1 2 I think in going through with the Inspectors and, 3 indeed, 4 investigations the combinations are wide and varied. 5 To say one or the other, 6 combinations of scenarios. 7 17 Q institutions carrying out other there had been umpteen The concept of a combination of funds turning up in 8 your books as a single memorandum account is not 9 impossible or not unusual? 10 A It is not a surprise to me. It is something that 11 they have, 12 and it is quite possible that peculiarity could 13 ex is t. 14 18 Q obviously, managed in this particular way In those circumstances, as far as you are concerned, 15 you have no reason to disbelieve Mr. Benjamin's 16 affidavit that of the Captain Rogers trust no 17 appointments or loans were made out of it? 18 A He has the information available to him which I do 19 not and he has, 20 front of a notary public in Cayman and so I have to 21 believe that what is put in front of me is the facts 22 as he sees it. 23 19 Q 24 A 25 26 27 28 29 obviously, You do not wish to contradict them? No, I cannot. I have no evidence to contradict them on. 20 Q sworn that information in Thank you very much. 1 2 MS. MACKEY: 3 4 MS. MACKEY: 5 Mr. Collery, can I just clarify a couple of things 6 here, 7 that you on a number of occasions made a number of 8 payments to Mrs. Mason on Mrs. Roger's behalf? 9 A. 10 11 Yes, if you would not mind. I believe Mrs. Mason acted as the courier and came to me and, yes, 21 Q. 12 Am I correct in saying I made a number of payments. Did you debit those payments in the memorandum accounts to A/A3? 13 A. 14 22 Q. I did. Was A/A3 a memorandum account of an account held in the name of Hamilton Ross in Cayman? 15 16 A. 17 23 Q. 18 A. 19 24 Q. It w a s . A memorandum of something in Hamilton Ross? Yes. Does that mean that if we accept Mr. Benjamin's 20 evidence as correct that Mrs. Rogers was, 21 entitled to receive money in her own right from a 22 Hamilton Ross account unrelated to her husband's 23 trust? 24 A. What it appears here is that, in fact, if I may go back now 25 with the evidence in front of me now, A/A3 appears 26 to be a pooled account for a situation that now 27 appears is one part of that pool, 28 figures mentioned but I do not know what the extent 29 of the pool is, if that is the case, which I think there was 1 represented a trust fund. 2 funds that were, 3 Traynor, 4 A/A3 was the vehicle or the account through which 5 those was debited and what appears from 6 Mr. Benjamin's affidavit that that debit, 7 don't know, 8 accountant's perspective is that if you had a pool 9 and you had two accounts, because that's the way the Another pool represented at some stage, given to Mr. I think that is what is mentioned there. and I I can only again look at it from an 10 bureau system worked, 11 Cayman, 12 transactions were debited not to the trust pool or 13 trust account proper, 14 this other account proper. 15 25 Q. was that when that went out to and we discussed that, that those as it were, but it went to At the end of the day what it means is, as I 16 understand it now and if we accept the evidence, 17 which we must, 18 contradict it must mean that monies belonging to 19 Mrs. Rogers were held in Hamilton Ross, must it not? 20 A. 21 2 6 Q. Yes. Thank you very much. 22 Mr. Rowan, 23 MR. ROWAN: 24 25 26 27 28 29 of Mr. Benjamin which you do not I have no further questions. do you have any question. Not for the present, you. MS. MACKEY: Mr. Sheehan. thank 1 2 SHEEHAN: 3 4 MR. SHEEHAN: No, 5 I would just like to press with Mr. Collery 6 that in relation to what appears to be a conflict of 7 evidence here that you have given your statements 8 and your evidence to the Inspectors in good faith in 9 the context of the knowledge available to you at the 10 time. 11 would confirm this, 12 possession of all of the information and when you 13 make a statement linking Ascot Ventures and A/A3 and 14 Sonia Rogers you are doing so in the context of 15 limited knowledge that you have? 16 A. I think what is clear now, Absolutely, and maybe you is that you are not in I have always said that. It is to the 17 best of my understanding and belief as to the 18 relationships that were held there. 19 evidence, 20 I have to accept that. 21 MS. MACKEY: If further as is in this case has come to light, 22 then Absolutely, Mr. Collery. We accept absolutely that 23 your evidence is always given in good faith and we 24 thank you very much for your elucidation on matters 25 here today. 26 Thank you very much. 27 28 29 THE INTERVIEW WAS THEN CONCLUDED Appendix XV (113) Captain Tim Rogers 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Captain Tim Rogers. a) Transcript o f evidence o f Mrs Sonia Rogers dated 27 March 2000. b) Statement o f Mrs Sonia Rogers dated 24 March 2000. UNDER OATH ON MONDAY, 2 7TH MARCH 2 00 0 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MS. MACKEY BL Solicitor to the Inspectors: MS. M. CUMMINS Interviewee: MRS. Represented by: MR. RICHARD LAW NESBITT SC Instructed by: MR. MICHAEL O'SHEA SONIA ROGERS KENNEDY McGONAGLE BALLAGH SOLICITORS 2 0 NORTHUMBERLAND ROAD DUBLIN 4 WITNESS M R S . S . ROGERS EXAMINATION MR. JUSTICE COSTELLO PAGE 6 - 53 MS. MACKEY 54 - 66 MR. JUSTICE COSTELLO 67 - 69 1 2 3 4 MR. JUSTICE COSTELLO: Good morning 5 Mrs. 6 start our interview now. 7 and on my right is Ms. Mackey. 8 Inspectors appointed, 9 The High Court. Jorgensen. We will My name is Declan Costello We are the as you know, by 10 11 I should explain to you, Mrs. 12 is not a Court or it is not a Tribunal. 13 interview. 14 order of the Court and our statutory p o w ers . Jorgensen, that this It is an You are being interviewed under the 15 16 If in the course of the interview you wish us to 17 stop asking any questions, 18 from your counsel and solicitor, please tell us so 19 and we will stop. and wish to take advice 20 21 Similarly, 22 stop because they wish to give you advice, 23 of course, 24 you can consult with your legal advisors. if your counsel and solicitor wish us to they are, at liberty to do so and we will stop and 25 26 We obtained the statement of declaration that you 27 wish to make to us just before we came in here and 28 we understand perfectly what the position is. 29 understand the circumstances in which you are We 1 attending here today and we are exercising our 2 powers conferred on us by the Court and by The 3 Statute in asking you to attend. 4 5 Mrs. Jorgensen, 6 and I am now going to ask our solicitor, 7 Ms. Cummins, 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 this interview is held under oath to administer the oath to you. 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mrs. Jorgensen, we wrote you a long letter on the 6 20th January last in the course of which we asked if 7 you could supply us with a written statement and we 8 also asked for all documents that you would have in 9 your power and possession in relation to the matters 10 we raised. 11 12 Just before we came in we obtained a written 13 statement from you, a short written statement, 14 has been given to us but we have obtained no 15 documents at all. which 16 17 Accordingly, 18 to come in again. 19 a great deal more documentation. 20 information that we can get without documents from 21 today's interview we will ascertain what further 22 questions we need to ask you. it may be necessary for us to ask you We would certainly require to see Depending on the 23 24 I am afraid Mrs. 25 to ask you to come in again. 26 how we can get on today in the light of the 27 information which you have given us in the 28 statement. 29 Jorgensen that it may be necessary However, we will see 1 It seems to me that it would be useful if you took 2 the statement. 3 (Exhibit 1)? Have you got a copy of it there 4 5 2 Q. If we just go through your statement, 6 Jorgensen. 7 When were you married? 8 A. 9 3 Q. Mrs. Your husband died on 1st January 1984. 1965. Your husband was a very well known figure in the 10 bloodstock industry. 11 where he carried on his bloodstock interests; and 12 the name of companies, 13 established in which they were carried on; and where 14 were the farms; and generally about your husband's 15 business? 16 A. 17 4 Q. 18 A. 19 5 Q. 20 A. 21 you could tell me if any, which he had Well, we had farms in Ireland. Yes? And New Zealand and America. Yes? And he carried on business from them. I don't think he had any companies. 22 6 Q. 23 A. 24 7 Q. 25 A. 26 8 Q. 27 A. 28 29 Perhaps, Sorry? I don't think he had any companies. You do not think he had any companies? No. That were in his o w n ...(INTERJECTION)? I have to tell you, Judge, I didn't know an awful lot of his businesses b ef ore.. . (INTERJECTION). 9 Q. Yes? 1 Before he died. 2 children and entertaining people at home and doing 3 that side of the thing. 4 with the business before but I obviously know the 5 studs he had and where he carried on his business 6 from. 7 10 Q 8 A 9 11 Q 10 A 11 12 Q 12 A 13 13 Q 14 A 15 14 Q 16 A 17 15 Q 18 A I really was at home looking after I really had nothing to do Could you just tell me where the studs where? In New Zealand. In Ireland first? In Ireland? Yes ? At Airlie Stud at Lucan. Yes? At Simmonstown. Where is that in? In Celbridge. Yes ? Well, before he died he had other studs. He had 19 Loughtown, which is near Dunsany -- Loughmore, 20 sorry, and Loughtown, which is Donadee, and 21 Grangewilliam, which is Maynooth. 22 one time. 23 anything else. 24 16 Q 25 A 28 29 I am just trying to think if there is I think that is it. Yes ? I might have left something out but I think I have got them. 26 27 He had Baroda at 17 Q Mrs. Jorgensen, these farms, these lands, were all owned by your husband, were they? 1 18 Q. 2 A. 3 19 Q. 4 Who were they owned by? He had partners. Yes. Do you know was there companies established between the partners who owned the land? 5 A. 6 20 Q. Yes. 7 A. Yes. 8 21 Q. Yes? 9 A. 10 22 Q. 11 Not that I know of. You can find out for us? Yes. The land may have been owned not by your husband but by your husband with others, is that right? 12 A. 13 23 Q. 14 A. 15 Yes, that is what I really mean, yes. Yes. And...(INTERJECTION)? I mean I owned Grangewilliam with my mother and my husband. 16 24 Q. 17 A. 18 25 Q. 19 Yes? That sort of thing. Yes. I would like you just to tell me what you owned, what lands you owned, with your husband? 20 A. 21 26 Q. 22 A. That was it. 23 27 Q. That was it? 24 A. 25 28 Q. 26 A. 27 2 9 Q. 28 29 I owned a third of Grangewilliam. Yes? Yes. And the others? I bought myself, yes. Yes. The others would have been owned by your husband and his partners, is that it? 1 30 Q. 2 A. 3 31 Q. You do not know? No. The business that was carried on, the bloodstock 4 business that was carried on, on these lands, do you 5 know whether companies ran this business? 6 A. 7 32 Q. 8 9 I know he ran it. I am sorry but do you know whether or not they were run by companies or not? A. 10 11 No, he ran i t . No, nothing was run by -- he ran -- as far as I know he just ran it. 33 Q. Yes. You can ascertain this for us. You can find 12 out for us how your husband carried on this 13 bloodstock business? 14 A. 15 34 Q. 16 17 Yes, I suppose so, yes. In addition your husband had land in New Zealand, had he, or did he own land himself or with others? A. 18 No, himself with his -- I think it was a trust again. 19 35 Q. 20 A. 21 3 6 Q. 22 What was the name of the trust do you think? It was a discretionary trust, I think, of some sort. No. The name of the company that was running the land if it was a company? 23 A. 24 37 Q. 25 A. 26 38 Q. 27 I don't think it was a company. You think a trust owned it? Yes, I think it was a trust. Again, will you ask your solicitor to ascertain particulars of how he owned the land in New Zealand? 28 A. 29 39 Q. Yes. And also whether or not it was carried on by a 1 2 3 4 0 Q. 4 A. 5 41 Q. 6 By a company? Yes. Where was the land in New Zealand? Do you remember the name of the place? 7 A. 8 42 Q. 9 Yes, it was called Grangewilliam Stud New Zealand. We know, at least it would appear, that there was a company established in the Cayman Islands called 10 Ascot Holdings Limited. 11 company was involved in the New Zealand stud 12 business? 13 A. 14 43 Q. 15 A. 16 44 Q. 17 A. 18 45 Q. 19 A. 20 4 6 Q. 21 A. 23 47 Q. 24 A. 25 4 8 Q. 26 A. 27 4 9 Q. 29 No, Ascot Holdings traded with the trust. It traded with the trust? Yes. Grangewilliam stud was in New Zealand? Yes. What about in the United States of America? The stud my husband owned there was called Kenary. Again, do you know did he own the land himself or had he partners? 22 28 Do you know whether this He had a partner. A partner? Yes. What was his name? Robert Clay. Do you know where the Kenary Stud was Mrs. Jorgensen? 1 50 Q. 2 A. 3 51 Q. In Kentucky? Yes. Again, I must ask you to ask your solicitors to 4 obtain particulars of the ownership of the land and 5 of any company that might have operated the stud 6 business on the land? 7 A. 8 52 Q. 9 Yes. Apart from these interests did your husband carry on any other business or have any other business 10 interests, Mrs. Jorgensen? 11 A. 12 53 Q. 13 A. Yes. 14 54 Q. Yes. 15 No, that was his life. That was his life? What family did you have? How many children did you have? 16 A. 17 55 Q. 18 A. 19 56 Q. 20 A. 21 57 Q. Two sons. Two sons, yes. Do they carry on in the business? One is in the business with me. Yes? And the other is in America. Yes. You said, when I was asking but about the 22 New Zealand farm, that you thought it was a trust, a 23 discretionary trust, that was involved in it. 24 you tell me what you know about that? 25 A. 26 58 Q. 27 A. Yes. I can't remember. You cannot remember the details perhaps? We sold it and it is gone and I cannot remember. can't remember. 28 29 No, I can't. 59 Q. Can When did you sell it? I 1 Twelve years ago. 2 maybe. 3 60 Q 4 A 5 6 Yes. I am not certain. Ten years ago You operated it for sometime then? I operated it for about four years, five years, after he died. 61 Q Yes. I just would like you to tell me how that 7 operation was carried on? 8 to New Zealand and how were they sent back from 9 New Zealand to you? 10 A 11 62 Q 12 A 13 14 How were the funds sent We had proper authority to do it. No. I just want you to tell me how it was done? I honestly -- I didn't really involve myself in the financial end of it I am afraid. 63 Q 15 I am sure not. However, just tell me what you know about it? 16 A 17 64 Q 18 A 19 65 Q 20 A Well, I just ran the horse end of it. Yes ? And I managed the stallions that were there. Yes? And managed the mares that were there, sold the 21 yearlings and it was organised really by my 22 trustees. 23 66 Q 24 A 25 Who were they? Connor Crowley organised it for me. He was my advisor. 26 67 Q 27 A 28 68 Q 29 A Yes? On everything to do with finance. Yes? And I did the horse management and he did all the 13 1 other bit and he helped me with all the -- I had 2 other trusts, the other two trusts at home. 3 helped me with all that. 4 69 Q. 5 He Just you mentioned trustees, was Mr. Crowley a trustee? 6 A. 7 70 Q. Do you know...(INTERJECTION)? 8 A. He advised me over everything. 9 71 Q. Yes, he was. I know. I just want to know whether he advised you 10 as an accountant or whether he was a trustee as well 11 as an accountant? 12 A. 13 72 Q. 14 A. 15 73 Q. 16 A. 17 74 Q . 18 A. 19 75 Q. Yes, he was a trustee. Do you know who the other trustees were? Liam McGonagle was one. Yes? And John Byrne was the other. Yes? But Conor was really the one that worked with me. These trustees, and in particular Mr. Crowley, would 20 have had to have legal advice, I am sure. 21 know who their solicitors were? 22 A. 23 76 Q. 24 A. 25 77 Q. 26 A. 28 78 Q. 29 Who my solicitors were? First of all who your solicitors were? My solicitors are Kennedy McGonagle. Yes. Do you know were Kennedy McGonagle also solicitors to the trust? 27 Do you Yes, I think so. Yes? 1 2 accountant, Mrs. Jorgensen. 3 looked after your own personal accounts? 4 A. 5 80 Q. 6 A. 7 81 Q. 8 A. 9 82 Q. 10 Who was that? Who Kennedy Stokes. . . (INTERJECTION) . Stokes Kennedy Crowley? Yes . Yes? Yes . Stokes Kennedy Crowley would have looked after accounts of the trustees too, would they? 11 A. 12 83 Q. 13 A. Yes . 14 84 Q. Yes. 15 A. Yes . 16 85 Q. Yes . Do you think? That was Mr. Connor Crowley's firm? Would you just look at the statement there 17 Mrs. Rogers, at the first sentence there: 18 "Some time after his death Des Traynor told me that my husband had shortly before he died established a discretionary trust abroad for my benefit."? 19 20 21 22 Did you know Mr. Traynor before your husband's 23 death? 24 A. I think I might have met him at a party or 25 something, at a social outing of some sort but I 26 can't -- no. 27 86 Q. 28 A. 29 87 Q. You had not met him professionally? No, certainly not. You had not sought his advice on anything before 1 2 A. 3 88 Q. 4 No, no, no. Did your husband tell you whether or not he had himself established a trust before his death? 5 A. 6 89 Q. Well... (INTERJECTION)? 7 A. So I ... (INTERJECTION) . 8 90 Q. 9 A. 10 91 Q. No, he didn't but he didn't tell me a lot of things. Have you since discovered that he had? Well, I know there was a trust, yes. You see Mrs. Rogers we are not concerned today about 11 your husband's affairs except insofar as they may 12 assist in ascertaining your affairs, and we may have 13 to go into this matter later. 14 relation to your affairs I wish to know whether or 15 not he ever told you that he had a trust during his 16 life time? 17 A. 18 92 Q. 19 A. 20 93 Q. 21 A. 22 94 Q. 23 A. 24 95 Q. 25 A. 26 96 Q. 27 A. 28 97 Q. 29 However, I think in No. Did you know anything about the...(INTERJECTION)? But he...(INTERJECTION). Sorry? He didn't tell me very much. I see. Very well? About business. So...(INTERJECTION)? To be truthful with you. So I...(INTERJECTION). So it was after his death? Yes. Mrs. Jorgensen, were you appointed one of his executors ? 1 2 98 Q 3 A 4 99 Q 5 A 6 100 Q 7 A 8 101 Q 9 A 10 102 Q The trustees I told you before. The same trustees. You and these three other people? Yes . Were appointed executors? Yes . Kennedy McGonagle were the solicitors? Yes . Who was the beneficiary under your husband's Will? 11 Were you the entire beneficiary, or was it 12 distributed between you and your family, or how was 13 it done, just generally? 14 A 15 103 Q 16 A 17 104 Q 18 A I think I was the beneficiary. Pardon? I think I was the beneficiary. You were the beneficiary? But presumably my children could get some. I can't 19 remember how the Will worked but my children got so 20 much and I got...(INTERJECTION). 21 105 Q 22 A 23 106 Q 24 A 25 107 Q Do you think that you were...(INTERJECTION)? I would have to ask my solicitor this. You would have to ask? Yes . Yes. Perhaps, we could be told by your solicitor 26 now what it was? 27 MR. O'SHEA: discretionary trust Will. 28 29 Judge, the Will was a MR. JUSTICE COSTELLO: Yes. 1 MR. O'SHEA: 2 3 children. 4 MR. JUSTICE COSTELLO: Yes . 5 MR. O'SHEA: And the trust assets were 6 primarily appointed to 7 M rs. Rogers. 8 MR. JUSTICE COSTELLO: 9 MR. O'SHEA: 10 MR. JUSTICE COSTELLO: 11 MR. O'SHEA: 12 MR. JUSTICE COSTELLO: Yes . 13 MR. O'SHEA: Yes . 14 MR. JUSTICE COSTELLO: By whom? By the trustees. Yes . In 1991. What happened between 1984 and 1991? 15 MR. O'SHEA: 16 The trustees ran the business in effect. 17 18 MR. JUSTICE COSTELLO: Yes . 19 MR. O'SHEA: Yes . 20 MR. JUSTICE COSTELLO: And was then everything 21 appointed to Mrs. Rogers? 22 MR. O'SHEA: to Mrs. Rogers. 23 24 Everything was appointed 108 Q MR. JUSTICE COSTELLO: Mr. Traynor told you that he had established a 25 26 discretionary trust abroad for your benefit. 27 tell you where? 28 29 A No . Did he 1 2 110 Q 3 A 4 111 Q 5 A 6 112 Q 7 A 8 113 Q 9 A 10 11 114 Q Yes, I do, and I knew...(INTERJECTION). And did you know last year? Yes, I definitely... (INTERJECTION) . Did you know ten years ago? No, I don't think I did know. Yes, I might have When you got appointed all the funds, you would have known? 13 A 14 115 Q 15 A 16 116 Q 17 A 18 Yes, I would have known, yes. Would you have known before that do you think? I don't think I asked him. No. Did you know, Mrs. Rogers, I am asking you? Yes, I think I knew it. Yes, I think I probably did. 117 Q 20 Yes. Would I be correct in saying that you probably knew shortly after your husband's death? 21 A 22 118 Q 23 A 24 119 Q 25 A 26 120 Q 27 A 28 29 You know today, do you? known ten years ago. 12 19 I don't know actually. Yes . Yes? Yes . Tell me what Mr. Traynor told you? Very little because I didn't ask him. Just tell me what he told you? He said that my husband had set up this trust for my benefit. 121 Q 1 2 122 Q 3 You did not know how much you were getting from the trust? 4 A 5 123 Q 6 A 7 124 Q 8 A 9 10 Yes. No. Did you ever know? I knew in the end, yes. Yes. What do you mean by "in the end"? Well, I knew what the -- I mean I knew what the ultimate amount was. 125 Q 11 When did you know how much approximately you had got in the trust in the Cayman Islands? 12 A 13 126 Q 14 A I think just recently. I mean, you know not before. You mean in the last year or two? Well, really when I -- he would tell me that there 15 was -- that it was all all right and there 16 was...(INTERJECTION). 17 127 Q 18 am asking you? 19 A 20 128 Q 21 22 Yes . The question I am asking you is: When did you know how much was in the trust, approximately? A 23 24 Mrs. Rogers, will you just listen to the question I I knew when I asked Padraig finally, Padraig Collery, what was in it. 129 Q 25 When Traynor told you that your husband had established a trust? 26 A 27 130 Q Yes . Did you think it was for one thousands pounds, or 28 ten thousand pounds, or a million pounds? 29 know? Did you 1 2 131 Q. 3 A. 4 132 Q. 5 6 You did not ask? No. Were you not concerned to know how much money you would have after your husband's death? A. 7 No, I wasn't because I had a lot of other things to organise myself, and to run. 8 133 Q. 9 A. 10 Yes? And I reckoned that -- Des Traynor was supposed to be a very clever man and knew what he was doing. 11 134 Q. 12 A. 13 135 Q. 14 So I understand what your evidence is to us? I did -- I left it to him. So I understand what your evidence is Mrs. Jorgensen, I want to be clear on this? 15 A. 16 136 Q. 17 A. 18 137 Q. When your husband died? 19 A. I do know now how much. Yes. Do you know how much was in the trust? Yes, I do now know. I didn't know how much was 20 in it when he died, no, but I know now how much 21 there is there. 22 138 Q. 23 Have you added much to the trust in your lifetime? 24 A. 25 139 Q. 26 Not very much, no. What is now there must be pretty close to what was there when your husband died? 27 A. 28 140 Q. 29 Yes. Well, it is possible to see what I added to it. No. I am just asking you, is that not so? 1 was in the beginning because -- unless I worked it 2 out, would I? 3 141 Q. So your evidence to me, to us, today is that you 4 have no idea how much your husband put into the 5 trust? 6 A. 7 142 Q. 8 No, I don't know how much it was. I see. Did Mr. Traynor tell you what the effect of the discretionary trust was? 9 A. 10 143 Q. 11 A. Yes, I understand what a discretionary trust is. Tell me what he told you? I don't know. He just -- I think he said -- I don't 12 know what he told me. 13 me . 14 14 4 Q. 15 A. 16 145 Q. 17 A. 18 You cannot remember? No. Did he tell you you could use the money? No. He did, at one stage later on, tell me I could use the money and I used some in the 1990s. 19 146 Q. 20 A. 21 How did you use it? He said I had to let him know when I wanted some money. 22 147 Q. 23 A. 24 148 Q. 25 A. 26 14 9 Q. 27 A. 28 150 Q. 29 I can't remember what he told Yes? And he would arrange it for me. Used you let him know then? Yes. What would you do? I would ring him up and say I wanted £10,000. Yes? 1 2 151 Q. 3 A. 4 152 Q. 5 A. 6 153 Q. 7 A. 8 154 Q. 9 A. In cash. 10 155 Q. In cash? 11 A. 12 156 Q. Yes. What would he do? My secretary went in and picked it up. What was your secretary's name? Kay Mason. Did she pick it up in cash or in cheque? Yes. Any time you drew money then from the trust funds, you drew it from Mr. Traynor, is that right? 13 14 A. 15 157 Q. 16 Yes. You would write to him or ring him up and then your secretary would collect it? 17 A. 18 158 Q. Yes. Can you remember how often this would have happened Mrs. Jorgensen? 19 20 A. 21 159 Q. 22 A. 23 160 Q. 24 A. 25 How often? I have got a list Judge of the times I drew. Yes? And how much I drew, which I can give to you. Yes. How was that list prepared, do you know? Sorry, I don't understand what you mean, prepared"? 26 161 Q. 27 A. 28 162 Q. 29 Would he then? Was it prepared by your accountant? By my secretary. The list of monies you received? "how was it 1 2 163 Q. 3 A. 4 164 Q. 5 6 In the office? Yes. The list, that you are now going to hand into us, was that prepared from the documents in your office? A. 7 No, I don't have documents, but I kept an account of what I had spent, yes. 8 165 Q. 9 A. 10 166 Q. 11 You kept an account? Yes. Was this in some sort of book or something, you kept an account? 12 A. 13 167 Q. 14 A. No. In your head then? No, not in my head. in my head. 15 16 168 Q. 17 A. 18 169 Q. 19 A. 20 170 Q. Would you not tell me Mrs. Jorgensen? I had it on a bit of paper, what I had spent. No. I am...(INTERJECTION)? What I had drawn. Yes. I understand that you drew. 21 start drawing? 22 death? 23 A. 24 171 Q. 25 A. 26 172 Q. 27 A. 28 173 Q. 29 I wouldn't be able to keep it When did you Was it shortly after your husband's No, no, no. When did you start drawing? 1993. You started drawing? Yes. We will see this in the course of time but you have 1 2 3 £ 1 0 ,0 00 . 174 Q Where did you get that information from? It would 4 have been difficult to keep that in your head, would 5 it not? 6 A 7 175 Q 8 No, I had this list. Somebody prepared a list, your secretary prepared a list? 9 A 10 176 Q 11 A 12 177 Q Mrs. Jorgensen, 13 A No, I am sorry. 14 178 Q 15 A 16 179 Q Yes . From what? From what I had asked her. I think you understand my question. Do you not understand it? No. Very well then. The secretary wrote down on a piece 17 of paper, that was subsequently to be typed up, that 18 you had received £10,000 in 1993 from Mr. Traynor, 19 is that right? 20 A 21 180 Q 22 Sorry, I don't understand what you are asking me? What is written on that page? (Same handed)(Exhibit 2) What do not you understand, Mrs. Jorgensen? 23 A 24 181 Q 25 A 26 182 Q 27 A 28 183 Q 29 A Those are the lists of the amounts I asked for. Who wrote that list? My secretary. Did you give her the figures? Well, those were the figures...(INTERJECTION). Sorry, listen to my question? 1 184 Q 2 Did you give these figures to you secretary, to Ms. Mason? 3 A No. 4 185 Q No? 5 A No. 6 186 Q 7 A 8 187 Q 9 A 10 Where did she get them from then? I don't know. You do not know? No. I am sorry I don't quite understand what...(INTERJECTION). 11 188 Q 12 A 13 189 Q What do you not understand, Mrs. Jorgensen? Well, I asked for this money. No, no. Do not worry about that. We will come to 14 that later. 15 list was prepared by Ms. Mason. 16 not give her -- you did not tell her that you 17 drew £10,000 on the 15th March 1993? 18 A 19 190 Q 20 A 21 191 Q 22 A 23 192 Q 24 A 26 193 Q 27 29 You said you did I said I didn't tell her? Yes, that is right? But she must have known because she collected it. Yes. How did she...(INTERJECTION) She collects all my money. Are you saying then that she made up this list from her own knowledge? 25 28 I am just asking you about how this Yes, obviously, I suppose. Obviously, you suppose. You did not tell her anything? A Well, I asked her to collect the money and she collected i t . 1 194 Q No, no. Mrs. Jorgensen, you are going astray from 2 the question. 3 this list was prepared? 4 A 5 195 Q 6 A 8 196 Q 9 A 10 197 Q 11 A 12 198 Q 13 A 14 199 Q 15 No, no. How did Ms. Mason write down £10,000 on She had a list of what she collected. That is what I would have thought? Yes . Yes. Where was the list kept? I had the list. Can you produce it for us? Yes, (INDICATING) the list...(INTERJECTION). No, no. It is the original document I am concerned about? A 17 18 It was prepared from what I collected, yes. 15th March 1993? 7 16 The question I am asking you is how I don't have an original document. original. 200 Q 19 That is my list. That is the I had no document. Mrs. Jorgensen, is Ms. Mason available to us? Is she in your employment still? 20 A 21 201 Q 22 A 23 202 Q 24 A 25 203 Q 26 A 27 204 Q 28 A 29 205 Q Yes, she i s . When did she prepare this list? I don't know when she -- I don't know. Do your best, yesterday? I don't know. Last week? I honestly don't know when she...(INTERJECTION). Did you ask her to do it? I wanted a list...(INTERJECTION). 1 questions I am asking you now and stop sparring with 2 me? 3 Yes . 4 206 Q 5 Did you ask her? Did you ask Ms. Mason to prepare this list? 6 A 7 207 Q 8 A 9 208 Q 10 A 11 209 Q 12 A 13 210 Q 14 A 15 211 Q 16 A 17 212 Q 18 A 19 213 Q 20 A 21 214 Q 22 Yes, yes, I did. When. Well, I had a list. When did you ask Ms. Mason to prepare this list? Sorry, I don't know. Was it yesterday? No, it wasn't yesterday. Was it last week? No. When was it? I am sorry, I don't know. You cannot remember when you asked her? No. Was it this year? No. This list then would have been prepared some time last year, would it? 23 A 24 215 Q 25 I don't know when the list was prepared. When did you ask her? Can you remember when you asked her? 26 A 27 216 Q 28 A 29 217 Q No, I can't. You cannot? No. If you did not give her the information she must 28 1 have prepared the list herself then from her own 2 knowledge of it? 3 A. 4 218 Q. 5 A. 6 219 Q. But we...(INTERJECTION). Listen to the question? Yes. The question is if you did not tell her, am I 7 correct in assuming that she from her own knowledge 8 prepared the list? 9 A. 10 220 Q. What documents would she have? 11 A. She didn't have any documents. 12 221 Q. 13 A. 14 222 Q. 15 A. 16 223 Q. We would...(INTERJECTION)? 17 A. I mean I ...(INTERJECTION). 18 224 Q. Yes, I suppose so. So she prepared it from her memory? She wrote it from her memory. Well... (INTERJECTION)? From going to Des presumably. Yes. We will require Ms. Mason to illicite this 19 point for us so we can pass from it. 20 this then you would have received no income at all 21 from the trust fund? 22 A. 23 225 Q. 24 A. 25 226 Q. 26 No accept... (INTERJECTION) . Until 1993? Yes, that is true. I want you to look at page 31 (Exhibit 3) (Same handed)? 27 A. 28 227 Q. 29 According to Yes. I want you to look at a photostat of a cheque made 1 It is payable to you for £4,000 and it is Kentford 2 Securities Limited. 3 Securities Limited? 4 No. 5 228 Q Do you remember Kentford Did you know that this was a cheque, that this was 6 an account that Mr. Traynor had from which he paid 7 people who were entitled to funds held by 8 "Ansbacher"? 9 A 10 229 Q It is apparently one of my -- is it, no. Very well. Mrs. Rogers, if you would just like to 11 put that down for now. 12 saying -- Mrs. Jorgensen, would you just pay 13 attention to what I am saying? 14 A 15 230 Q 16 17 A Am I correct in saying that, in fact, you made Well, I ran a trading account with the trust which I was...(INTERJECTION). 19 231 Q 20 A 21 232 Q 22 A 23 233 Q 24 A 25 234 Q 26 A 27 235 Q 29 Sorry . lodgements to this account through Mr. Traynor? 18 28 If you, am I correct in With Mr. Traynor? Yes . Mr. Traynor? Yes . You paid money into it? Yes . And...(INTERJECTION)? This was with horses. Do you know that you paid money into the "Ansbacher" account? 1 words "Ansbacher" -- I knew nothing about 2 "Ansbacher" until...(INTERJECTION). 3 236 Q 4 Yes. You give it to Mr. Traynor but this was to do with the trust? 5 A 6 237 Q Yes . Of course, apart from Mr. Traynor looking after the 7 trust affairs, you would have had other bank 8 accounts, had you not? 9 under your husband's Will? 10 A 11 238 Q 12 A 13 239 Q 14 You had your own trust Yes, I had his Will trust. You had his Will trust? Yes . That business, was it, carried on -- that was an account, was it, carried on in The Lucan Branch? 15 A 16 240 Q 17 A 18 241 Q 19 Yes . Of AIB, was it? That is right, yes. You had, for the purpose of carrying on your business account at The Lucan Branch of AIB? 20 A 21 242 Q 22 A 23 243 Q 24 A 25 244 Q 26 A 27 245 Q 28 A 29 246 Q Yes . Did you have other bank accounts besides those? Yes . Where were they? All in Lucan branch. All in Lucan? Yes, lots of different ones in Lucan Branch. In Lucan? Yes . 1 2 247 Q 3 A 4 248 Q 5 A 6 249 Q 7 A 8 250 Q 9 A 10 251 Q 11 A 12 I did. Where did you go to see him? I went to the Roadstone...(INTERJECTION). Head Offices? Yes . In Fitzwilliam Square? That is right. How often would you have gone in to see him? I think probably once a year or that sort of thing, 18 months. 13 252 Q 14 A 15 Did he give you a statement? He told me usually that everything was absolutely fine . 16 253 Q 17 A 18 254 Q 19 A 20 255 Q 21 A 22 256 Q 23 A 24 257 Q When did you get rid of those? 25 A Three years ago I moved house. 26 258 Q So the written statements that 27 Did he give you a statement? Yes, he told me what I...(INTERJECTION). No, no. Did he give you a statement? Yes . Yes. A written statement? Yes . Have you got those? No. Mr. Traynor...(INTERJECTION)? 28 A 29 259 Q And I to get rid of -- I had thirty years of stuff. The written statements that Mr. Traynor had given 1 2 Yes . 3 260 Q 4 A 5 261 Q 6 A 7 262 Q 8 9 You kept them up to three or four years ago? Yes, I think I had them for a bit. Yes ? And then I got rid of them. Yes. Did those statements show you the amount of money that was available to you in the trust? A 10 No, I don't know what they did show. They must have shown what was there, yes. 11 263 Q 12 A 13 264 Q Yes ? I suppose they must have done, yes. Yes. If you went in every year or 18 months to 14 Mr. Traynor you would have known this for a 15 considerable number of years? 16 A No, I don't think to begin with I didn't. I think 17 to begin with he just told me everything was all 18 right and not to worry. 19 265 Q 20 A 21 2 66 Q 22 23 A You have told me that you went in And I didn't bother about it but I must have known latterly. 267 Q 26 Can we go back to your statement now? Would you look at your statement, Mrs. Jorgensen (Exhibit 1)? 27 A 28 268 Q 29 And...(INTERJECTION). every...(INTERJECTION)? 24 25 So you have said? Yes . It reads: "When Des Traynor spoke to me I was aware that my husband had established a 1 discretionary trust in Ireland in his Will and had also established two separate trusts of different lands all for the benefit of my children and myself." 2 3 4 5 What are they Mrs. Jorgensen? 6 A. 7 269 Q. 8 A. 10 270 Q. 11 Yes. He had appointed the three trustees that you mentioned? 12 A. 13 271 Q. 14 A. 15 272 Q. 16 A. 17 273 Q. 18 A. 19 274 Q. 20 A. 21 23 Would you just tell me, your husband had left a Will? 9 22 This is my own -- this is what I look after at home. Yes. In addition he had established two separate trusts? Yes. What are these? They were for...(INTERJECTION). What are these? These were for the lands, the various lands. When were these established? When were they established? I don't know. I would have to ask my solicitor. 275 Q. Do, do, yes. You can tell me? MR. O'SHEA: 24 They were established Judge, a few years before 25 he died. 26 MR. JUSTICE COSTELLO: Yes . 27 MR. O'SHEA: I think one in 1979 and 28 29 1 I can established the 2 precise dates for you. 3 MR. JUSTICE COSTELLO: Yes . 4 MR. O'SHEA: And they related, as 5 Mrs. Rogers said, to 6 property. 7 MR. JUSTICE COSTELLO: Yes . 8 MR. O'SHEA: One related to lands at 9 Lucan and the other to 10 lands at Grangewilliam, part of the lands at 11 Grangewilliam. 12 MR. JUSTICE COSTELLO: 14 who were the trustees? 15 MR. O'SHEA: 16 No, they were absolute trusts. MR. JUSTICE COSTELLO: 18 19 These were discretionary trusts and 13 17 Yes. Total trusts. Who was the. . . (INTERJECTION) . MR. O'SHEA: 20 For the benefit of Mrs. Rogers and her 21 children. 22 MR. JUSTICE COSTELLO: 23 Yes. Did the trust operate then. 24 MR. O'SHEA: No . 25 MR. JUSTICE COSTELLO: Did the trust operate then on death? 26 27 28 29 MR. O'SHEA: Well, they operated I think when the children 1 2 Or when the youngest 3 reached 2 1 . 4 MR. JUSTICE COSTELLO: 5 Yes, I see. If we just look at the last sentence: 6 "I do not recall..." 7 8 Of the first paragraph: 9 "I do not recall if it was at this meeting or at a subsequent meeting that Des Traynor advised me that the trust was involved in bloodstock." 10 11 12 13 14 What do you mean by that, Mrs. Jorgensen? A. 15 16 not? 277 Q. 17 18 It was the first meeting we are talking about, is it Would you look at the last sentence of the first paragraph? A. Yes. I don't -- well, I don't know whether it was 19 the first meeting or when it was. 20 mean. 21 278 Q. 22 That is what I Tell me about the trust being involved in bloodstock? 23 A. 24 279 Q. 25 A. Well, it traded in bloodstock. Just tell me what Mr. Traynor told you? I don't think he told me very much, Judge. H e ...(INTERJECTION). 26 27 280 Q. 28 A. 29 281 Q. Well, you have...(INTERJECTION)? He said that it was in...(INTERJECTION). 1 here, about this and I want you to tell me what you 2 were trying to convey to me? 3 A. Well, I am trying to convey to you that I don't know 4 whether it was at the first meeting or when he told 5 me that the business was involved in bloodstock. 6 282 Q. 7 A. 8 283 Q. 9 Just explain that to me? And then...(INTERJECTION). No, no. Mrs. Jorgensen, please listen to the questions that I am asking you? 10 A. 11 284 Q. Yes. Could you explain to me what you mean in your 12 statement when you say that the trust was involved 13 in bloodstock? 14 A. It came from...(INTERJECTION). 15 16 285 Q. 17 A. 18 286 Q. Tell me about that? Well, it must have come from...(INTERJECTION). Tell me about the involvement of the trust in bloodstock? 19 20 A. 21 287 Q. 22 A. 23 288 Q. 24 A. 25 289 Q. 26 Well, it dealt in it. It dealt it? Yes. Very well? Yes. When you say "it dealt in it", the trust was established in the Cayman Islands? 27 A. 28 290 Q. 29 Well, the trust was involved in bloodstock. Yes. Who dealt in bloodstock? 1 291 Q 2 A 3 Ascot Holdings? Holdings. this. 4 292 Q 5 A 6 Sorry, I am being a bit stupid about Ascot Holdings dealt in bloodstock. Did Mr. Traynor tell you that? No, he told me to continue dealing with Ascot Holdings. 7 293 Q 8 A 9 294 Q 10 Do you see ...(INTERJECTION)? In bloodstock with the trust, sorry. Do you see, Mrs. Jorgensen, what you have written here in your statement: 11 "Des Traynor advised me that the trust was involved in bloodstock." 12 13 A 14 295 Q 15 16 Yes . I want you to explain what you meant by that statement ? A 17 Well, the original trust was involved obviously in bloodstock. 18 296 Q 19 A 20 297 Q 21 A 22 298 Q 23 A 24 Yes. What was the original trust? Well, presumably what my husband set up. Which was Ascot Holdings? No, Ascot Holdings was set up after my husband died. By whom? I was told by Des Traynor to deal in bloodstock with the name of Ascot Holdings and this is what I did. 25 299 Q 26 A 27 300 Q Tell me about Ascot? Ascot Holdings dealt with the trust. You were advised by Mr. Traynor that your bloodstock 28 business should be done through Ascot Holdings 29 Limited? 1 Certain amounts of it should be done. 2 odd nominations for them, odd bits and pieces and 3 dealt with the trust. 4 301 Q 5 A 6 302 Q 7 A 8 303 Q 9 A 10 304 Q 11 So, I bought Ascot Holdings? As Ascot Holdings. Yes? Sorry, I am being a bit flustered. You are what? I am just getting a bit flustered. Very well. Perhaps we will adjourn for a few minutes ? 12 A 13 305 Q No, I am all right. I am not. I would like a cup of coffee. I think 14 we will adjourn for a cup of coffee for about 15 ten minutes or so. 16 17 SHORT ADJOURNMENT 18 19 306 Q MR. JUSTICE COSTELLO: 20 Ms. Cummins, would you see tab two. 21 35, 36 & 37. 22 witness 23 A 24 307 Q 25 A 26 308 Q If you would hand those up to the (Same handed) (Exhibits 4, 5, & 6 )? Yes . Have you got a copy there? Yes . Mrs. Jorgensen, if you see the first one of these 27 accounts. 28 is "Ansbacher Limited (Exhibit 4)"? 29 A It is pages It is a statement of account. It 1 309 Q 2 A 3 310 Q Yes . There is a lodgement. 4 letter there "A/A3"? 5 side? 6 A Yes, sorry, yes. 7 311 Q Do you see that? 8 A 9 312 Q 10 A 11 313 Q 12 A 13 314 Q Do you see there is a coded Do you see on the right-hand Yes . This is page one? Yes . Of this statement to Hamilton Ross? Yes . The opening balance is nil and then a lodgement. 14 the 3rd December 1992 there is a lodgement 15 of £360,366. 16 A 17 315 Q Do you see that? Yes . Were you told about the fact that your money was 18 being held, the trust money was been held, in the 19 account of, in the coded account in the name 20 of, Hamilton Ross? 21 A 22 316 Q 23 You mentioned Mr. Collery there a short time ago. Did you meet Mr. Collery? 24 A 25 317 Q 26 A 27 318 Q 28 A 29 No, I do not. I did. How often would you have met Mr. Collery? I met him after Des Traynor died. What did he explain to you? He explained to me that he would be running the account. On 1 319 Q 2 Yes. Did he explain to you that it was going to be lodged in the name of Hamilton Ross? 3 A 4 320 Q No, I never heard of Hamilton Ross until recently. What I am just wondering was: The accounts which 5 you were given from time to time, in the form that 6 is shown there on that photostat, were they like 7 that? 8 A I wasn't given these, no. 9 321 Q You were not given those. Were you given something 10 in the form like that, in that form, but with the 11 top cut off so that you had, in typed form, the 12 date, the value, the description and the debit and 13 credit? 14 A 15 322 Q 16 Were you given that? No, Judge. Would you just look at the page two of "A/A3 (Exhibit 5)"? 17 A 18 323 Q Yes . Again in the name of Hamilton Ross and that is 1993. 19 You see there are sums lodged to this account. 20 you see that? 21 A 22 324 Q 23 24 Yes . Would they be the sort of sums that you were lodging to the account? A 25 No, I lodged I think -- I know there was -- how much is that? 26 325 Q 27 A 28 29 Do They are very substantial sums Mrs. Jorgensen? I never put sums like that, no, because they were small sums for horses. 326 Q Yes? 1 2 You see the information which we have obtained is 3 that this "A/A3" was the coded number for your trust 4 Mrs. Jorgensen, and that this is the account of your 5 trust that was held in the name of Hamilton Ross, 6 and that this shows a record that these sums were 7 lodged in 1993? 8 A 9 328 Q 10 A I wouldn't have lodged those sorts of amounts, no. What sort of sums did you lodge? I lodged I know £60,000 once for something that was 11 sold through a share-ring and that is the only one I 12 can remember offhand, but I certainly didn't lodge 13 those. 14 329 Q Would you look at the next document which I want you 15 to consider? 16 (Exhibit 6 ) and it is 1997? 17 to date at £ 1 2 , 0 0 0 and it shows drawn, and a very 18 substantial sum of money is drawn, of £2 million? 19 A 20 330 Q 21 A 22 331 Q 23 A Yes . 24 332 Q Yes ? 25 A 26 333 Q 27 It is "A/A3" again and it is page 32 It shows the interest That was the total I thought was in that. That was -- you thought that? Yes . Did you? So, I would...(INTERJECTION). Has this brought it back to your memory then, Mrs. Jorgensen? 28 A 29 334 Q No, that was the final total I thought was there. However, you could not remember that before? 1 2 335 Q. 3 A. 4 336 Q. 5 A. 6 Did I not? No. I see? No, you did not ask me in the end when I knew. was something that I did know. 7 337 Q. 8 A. 9 338 Q. 10 £2 million. That was...(INTERJECTION)? I gleaned that at the end, yes. Was it at the very beginning, was it early on then, £2 million? 11 A. 12 339 Q. 13 A. Yes. 14 340 Q. Why? 15 A. 16 17 That No, no, no. Had it increased over the years? How had it increased? Well, presumably it increased because of how Des was looking after it. 341 Q. 18 You mean that he had invested the sums successfully for you? 19 A. 20 342 Q. 21 Well, presumably, yes. "Presumably" why do you presume that? Could it have been interest? 22 A. 23 343 Q. Yes, I suppose it could have been. I must ask you this question: Mrs. Jorgensen, did 24 you pay tax on the interest that was earned in this 25 account? 26 A. 27 344 Q. 28 A. 29 345 Q. No, I did not. If we turn back to your statement then? Yes. Would you just go down to the third paragraph: 1 "Over the years the trust traded in bloodstock through a company called Ascot Holdings Limited and subsequently Ascot Ventures Limited." 2 3 4 Would you mind telling me about that? 5 Yes, it traded as Ascot Holdings until -- I don't 6 know the date but it was after Des died when Padraig 7 Collery said to me that the trust was being changed 8 to Ascot Ventures and I didn't actually -- I think 9 he told me that there was some other company of 10 Ascot Ventures. 11 wasn't until later when I was told -- when 12 The McCracken Tribunal was started that I was told 13 that somebody else had been Ascot Holdings and that 14 is why I changed to Ascot Ventures. 15 346 Q 16 He told me at the time, and it You see it states then: "Most of the horses purchased by this company were held at our studs in Ireland and this arrangement was on an arm's length basis and keep fees were charged to this company"? 17 18 19 20 A 21 347 Q 22 Yes . Does it follow from this that the horses were the property of the company Ascot Ventures Limited? 23 A 24 348 Q 25 A 26 They were sold to Ascot Ventures, yes. Where was...(INTERJECTION)? But they paid keep. like any client. 27 349 Q 28 A 29 350 Q They paid insurance. They paid They were treated like a client. Where was Ascot Ventures Limited incorporated? Well, it was incorporated in the Cayman Islands. 1 require all the documents that you have in your 2 power and possession in relation to this. 3 know where The Trust Deed is, which your husband 4 caused it to be established? 5 A. 6 351 Q. 7 A. 8 9 Do you I presume...(INTERJECTION). Before he died? I presume it is in the Cayman Islands. I haven't seen it. 352 Q. 10 Have you given it to your solicitor or your accountant ? 11 A. 12 353 Q. 13 I haven't seen it. Have you given it to your solicitor or your accountant ? 14 A. 15 354 Q. 16 A. 17 355 Q. No. Did you ever request it from the Cayman Islands? No. We will require a copy of this document, and also 18 any letters of wishes that may have been associated 19 with the document. 20 to write requesting it from the Cayman Islands? 21 A. 22 356 Q. Will you instruct your solicitor I will. Will you instruct your solicitor to ask the company 23 in the Cayman Islands to give them all 24 correspondance and accounts in relation to the trust 25 which they may have? 26 A. 27 357 Q. Yes. Will you instruction your solicitor to make 28 enquiries in the Cayman Islands concerning the 29 company called Ascot Holdings Limited, when it was 1 2 3 358 Q. And all accounts in relation to that company and 4 Ascot Ventures Limited and all accounts in relation 5 to that company? 6 A. 7 359 Q. 8 Yes. Will you come to the next paragraph of your statement: 9 "In 1991 the trustees of a discretionary trust, established on my late husband's death following a change in the Capital Acquisitions Tax legislation, appointed all of the trusts assets to me." 10 11 12 13 Are you referring to ...(INTERJECTION) 14 MR. O'SHEA: 15 A. 16 The Irish trusts, Judge. Yes. MR. JUSTICE COSTELLO: 17 A. 18 360 Q. 19 The Irish Trust. Yes. Very well. You say: "I continued the business which included trade with Ascot Holdings Limited." 20 21 22 23 What does that mean? A. Well, I continued to trade with Ascot Holdings with 24 -- I am sorry, with them until I 25 think 19...(INTERJECTION). 26 361 Q. 27 Please, Mrs. Jorgensen, will you just listen to the question I am asking? 28 A. 29 362 Q. Yes. You continued the business which included trade with 1 2 I continued my business as I had been here and I 3 continued trading with Ascot Holdings. 4 363 Q 5 What does that mean? What did it mean "trading with Ascot Holdings"? 6 A 7 364 Q 8 A 9 365 Q 10 A 11 366 Q 12 A Well, buying and selling. Buying and selling horses? Yes . They were done by Ascot Holdings Limited? Yes . How long did that continue for? It wound down a few years ago because I changed my 13 business here a bit. 14 went into mares and there were no more stallion 15 shares. 16 the business so there was nothing more for -- to be 17 trading with and that was really the reason why. 18 367 Q 19 A 20 368 Q 21 I got out of stallions and I I started working on different facets of When was that? About three years ago, that sort of thing. Three years ago you -- up to three years ago you were operating through Ascot Holdings Limited? 22 A 23 369 Q 24 A 25 370 Q Yes, I wouldn't be able to give the exact year. However, about three years ago? About, yes. If you were operating through your business here in 26 Ireland, which you had under your husband's Will, 27 why if you are operating Ascot Holdings did you -­ 28 where you concerned to change over to Ascot, the 29 other company that Mr. Collery told you about, Ascot 1 2 Because there was somebody else who had used the 3 account of Ascot Holdings and I didn't know this 4 until he told me. 5 371 Q Did that not effect your decision to continue 6 trading with that company in respect of your Irish 7 business? 8 A 9 I am sorry, Judge, I changed to a different name. I didn't think there was any problem if it was a 10 different company. 11 Holdings to Ascot Ventures and I didn't — 12 told -- I didn't think anything odd in it, no. 13 372 Q It had changed from Ascot As I understand it you continued trading, using the 14 Cayman company Ascot Holdings, 15 had obtained from your husband in your 16 husband's Will. 17 A 18 373 Q 19 A 20 374 Q 21 A 22 375 Q 23 A 25 376 Q 26 A 27 29 for the property you No. However, you changed for some reason? No, no, sorry. Sorry? Sorry. I am sorry. Maybe I have misunderstood you. Was the Ascot Holdings only used for the Cayman? 24 28 I was That is right, yes. Yes ? Yes, sorry, sorry. It is completely separate the other. 377 Q Yes. I wonder is that so? Would you just look at the paragraph that I have been referring you to, 1 2 "In 1991 the trustees of a discretionary trust, established by my late husband's death following a change in the Capital Acquisitions Tax legislation, appointed all of the trusts assets to me." 3 4 5 6 That is your Irish business? 7 A 8 378 Q 9 That is my Irish business. Yes . "I continued the business which included trade with Ascot Holdings Limited"? 10 11 12 A 13 379 Q Well, what I mean is I continued my business here. We had this out just five minutes ago and you 14 explained just try to think it out yourself without 15 trying to get assistance. 16 yourself. 17 that you got the business in 1991, it was all 18 appointed to you, and you used Ascot Holdings 19 Limited for the purposes of your Irish business? 20 that not true? 21 A 22 380 Q 23 A 24 381 Q 25 26 27 28 29 Try to think it out Did you not tell me a few minutes ago Is No, not for that purpose, never. You...(INTERJECTION)? Never. I see. Very well then. I took you up wrong. did you mean by: "I continued the business which included trade with Ascot Holdings Limited." What 1 2 it? 3 Yes, I did. 4 in Ireland that belonged to Ascot Holdings. 5 animals on the stud in Ireland that belonged 6 to Ascot Holdings, yes. 7 crossed. 8 382 Q 9 A 10 383 Q 11 Sorry, I did because I had things I had So, that is where it Yes? I am sorry. No. It is rather complicated. I think you are making it complicated Mrs. Jorgensen? 12 A 13 384 Q I am not meaning to. Then if it is not complicated would you tell me 14 then, in relation to Ascot Holdings Limited, what 15 did you mean by saying: 16 "I continued the business which included trade with Ascot Holdings Limited"? 17 18 19 A I can't explain any more than I continued with Ascot 20 Holdings and the Cayman. 21 continued with my own business and I continued with 22 that. 23 24 25 26 27 28 29 385 Q That is what I mean. Move on to the next paragraph: "I met Mr. Traynor from time to time over the years and in 1993 mentioned to him that I had purchased a property in Dublin and was in the course of constructing three apartments there. I also said that I was doing substantial work in Grangewilliam House, Maynooth, Co. Kildare which I planned to live in. Des Traynor said that he would arrange with the Cayman trustees to make some appointments from the trust to help fund this work and payments were made I 1 for this purpose over the next few years." 2 3 4 Would you explain that to me? A. Yes, that accounts -- that was the money, the 5 withdrawals, 6 doing these things when I saw him that year and he 7 said, "Well, you can" -- that he would arrange for 8 me to be able to have some withdrawals, and that was 9 when the withdrawals started, and that accounts for I had because I told you him I was 10 the list of withdrawals, Judge. 11 these flats and that is what I spent the money on. 12 386 Q. I was doing up Mrs. Jorgensen, in relation to the trust that was 13 established by your husband in the Cayman Islands 14 for you prior to his death, you have said 15 that Mr. Conor Crowley managed these matters for 16 you? 17 A. 18 387 Q. 19 A. 20 388 Q. 21 A. 22 389 Q. 23 A. 24 390 Q. 25 A. 26 391 Q. 27 A. 28 392 Q. 29 Sorry? Yes? I do not want to interrupt. Yes? He did not manage -- he had nothing to do with this. With the Cayman trust? No. Okay. I see? He never knew about that. He never knew? No. You did not tell him? 1 2 393 Q 3 A 4 394 Q 5 A 6 395 Q 7 A 8 396 Q 9 A 10 397 Q 11 I see? With me. With Mr. Liam McGonagle? Yes . And John Byrne? Yes . Yes. I am sorry I misunderstood? Yes . The Cayman trust business was managed entirely by Mr. Traynor? 12 A 13 398 Q 14 A 15 3 99 Q 16 A 17 400 Q Yes . After Mr. Traynor's death by Mr. Collery? Yes, and trustees presumably. Will...(INTERJECTION)? Which...(INTERJECTION). This is where I just want to make clear what your 18 evidence is. 19 do you? 20 A You do not know who the trustee was, I know there was trustees. He told me there 21 were trustees but I don't know — 22 The Trust Deed, no. 23 401 Q I haven't seen Did he tell you that the company was, the trustee 24 was, either -- the company's name may have been the 25 Guinness Mahon Cayman Trust Company Limited. 26 tell you that? 27 A 28 402 Q 29 A No. Well...(INTERJECTION)? Did he 1 403 Q. 2 Did he name -- did he tell you who the trustees were? 3 A. 4 404 Q. No. That is all I wish to ask you at the moment 5 Mrs. Jorgensen. 6 questions to ask you. 7 END OF EXAMINATION OF MRS. SONIA ROGERS BY 8 MR. JUSTICE COSTELLO 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 However, Ms. Mackey may have a few 1 2 M S . MACKEY 3 4 405 Q. MS. MACKEY: I just wanted to ask you a 5 little bit, Mrs. Rogers, 6 about your meetings with Mr. Collery after 7 Mr. Traynor died. 8 had with Mr. Collery and how did it come about? 9 A. 10 406 Q. 11 A. 12 What was the first contact you I cannot remember that. Well... (INTERJECTION)? When it was or -- but he rung me at some stage and told me that he was looking after things. 13 407 Q. 14 A. 15 408 Q. 16 A. 17 409 Q. He contacted you? And not to worry, the same thing, not to worry. He contacted you, is that correct? Yes. After Mr. Traynor's death were you not anxious to 18 ascertain what was going to become of the management 19 of your trust? 20 A. I hate to have to tell you but I wasn't, no, because 21 I was very busy with my own things and this was 22 something -- no, I didn't. 23 410 Q. 24 A. 25 411 Q. 26 A. 27 412 Q. 28 A. 29 413 Q. Did you not need to make any withdrawals? No. Immediately after Mr. Traynor's death? No, no. Mr. Collery contacted you and told you not to worry? Yes. He would look after it? 1 2 414 Q. 3 4 Did you then contact him subsequently in order to conduct transactions on the account? A. 5 I never did any transactions on the account after that. 6 415 Q. 7 A. 8 After -- after when? I think after -- I am just trying to think when Mr. Traynor died. 9 416 Q. 10 A. 11 417 Q. 12 A. Did he die in...(INTERJECTION). He died in 1994? 1994. Yes? I wouldn't be 100% certain what I did after that but 13 I don't think there were hardly any transactions 14 since because it was wound down. 15 think about that. 16 418 Q. 17 A. 18 419 Q. 19 A. 20 420 Q. 21 A. 22 421 Q. 23 A. 24 Yes. Okay. I would have to In relation to the winding down? Yes. How did that come about? Well, I just stopped trading. You stopped trading with Ascot Ventures? Yes, because...(INTERJECTION). Is what you mean by that? Yes, because of the, as I explained, situation of changing. 25 422 Q. 26 A. 27 423 Q. 28 A. Yes. 29 424 Q. Yes. Yes? My line of interest. Yes, from stallions to mares? Did you continue to receive statements from 1 2 3 425 Q. 4 How did he do that? How did that statement come to you? 5 A. 6 426 Q. 7 A. He came to my house once. 8 427 Q. How did that visit arise? 9 A. 10 428 Q. 11 A. 12 429 Q. 13 A. 14 430 Q. 15 A. 16 He came and saw me and told me. He came to your house? He contacted me. And said he wished to come to see you? Yes. When was that Mrs. Rogers? I would be hazarding a guess if I said when it was. But... (INTERJECTION)? So, I am not going to guess. It was a year or so, more than a year, ago. 17 431 Q. Ago? 18 A. Yes. 19 432 Q. 20 A. 21 433 Q. 22 Did he contact you by telephone? Yes, I think so. What did he say to you on the phone when he contacted you? 23 A. 24 434 Q. 25 A. 26 435 Q. 27 A. 28 436 Q. 29 Did he contact you first? I think he said he would like to come and see me. Yes. Did he say why? He lived quite near me. Yes. Did he say why he wanted to come to see you? I can't remember. You cannot remember? 1 2 437 Q 3 A 4 438 Q 5 A 6 439 Q 7 8 A He came. What did he say to you when he came? He told me what the total was. Did he say, "I am coming to see you so as to tell No, I think he said he was coming to see me, could he come and see me. 440 Q 11 However, when he arrived he said, "I am here to tell you that your...(INTERJECTION)"? 12 A 13 441 Q 14 15 He came any way? you what the total on your account is"? 9 10 Yes. Well, we had a cup of coffee I think. Yes. However, what I am trying to get from you is...(INTERJECTION)? A 16 Then he told me that everything was fine and that is what my total was. 17 442 Q 18 A Why could he not have told you that on the phone? I don't know but he probably didn't think h e ...(INTERJECTION). 19 20 443 Q 21 A 22 444 Q 23 A 24 445 Q 25 A 26 446 Q 27 A 28 447 Q 29 A Did he bring documents? It was the sort of thing he would say. Did he bring documents Mrs. Rogers? No, nothing. He brought nothing at all? No, documents, no. He produced this figure out of his head? Yes . He had nothing written on a piece of paper? 1 lie about this. 2 was with me at the time, but I don't think he 3 did, no. 4 448 Q. 5 A. 6 449 Q. 7 I would have to ask Kay Mason, who I think he just told me. Ms. Mason was present at this meeting, was she? Yes, she was. He told you that the balance on your account was then what figure? 8 A. 9 450 Q. 10 A. 11 451 Q. 12 A. 13 It was £2 million. £2 million? Yes. Did he ask you what you wanted to do about that? I think he possibly did say, "What do you want to do," but I just left it. 14 452 Q. 15 A. 16 Yes? I just said, "I will continue and leave it with you" . 17 453 Q. 18 A. 19 454 Q. Did you? Yes. Did he say what the situation would be from then on 20 in relation to that account if you wished to 21 withdraw money? 22 A. 23 455 Q. 24 A. 25 456 Q. 26 A. 27 457 Q. 28 29 I didn't ask him. Did he say? No. He did not? No. I didn't want to withdraw money. I know that. However, you might have wanted to in 1 458 Q 2 3 Did he indicate that there might be any problem about further withdrawals? A 4 No, he didn't indicate any problem but I have to say I didn't indicate much interest. 5 459 Q 6 A Why was that? Because I didn't want to, you know. 7 to withdraw anything at the time. 8 him. 9 4 60 Q 10 A 11 So, I didn't ask Yes ? When I did my withdrawals my business at that time wasn't going quite so well. 12 461 Q 13 A 14 15 I didn't want Yes ? And it was getting better now and I didn't...(INTERJECTION). 462 Q Could I ask you to look again, Mrs. Rogers, at a 16 document which we have already shown you, which was 17 -- I think you possibly still have it. 18 final one of those statements from Hamilton Ross. 19 We see there the figure of £2 million (Exhibit 6 )? 20 A 21 463 Q 22 Yes . That you said Mr. Collery had told you represented the balance of your account? 23 A 24 464 Q 25 Yes . You see the date of that transaction. It is the 14th February 1997? 26 A 27 465 Q 28 A 29 It is the Yes . It indicates that that £2 million was drawn? Yes, it does. Yes, I agree with that. 1 2 467 Q 3 A 4 468 Q 5 A 6 7 You did not draw it? No, I didn't, I promise you. Well...(INTERJECTION)? It is, you know, it is, no. I don't know about what that means. 4 69 Q 8 Do you think that might have been roughly the date that Mr. Collery came to see you, 1997? 9 A 10 470 Q 11 A 12 471 Q 13 A 14 472 Q 15 A 16 473 Q I would like to check again may b e ...(INTERJECTION). With Ms. Mason? Yes, she may have an idea. You can check this with Ms. Mason? Yes . Can you? Yes . It may be that we would talk to Ms. Mason ourselves 17 any way. 18 money was being moved from the Cayman Islands? 19 A 20 474 Q 21 A 22 475 Q 23 24 Did Mr. Collery indicate to you that the No. He did not? No. Did he say to you it still was in the Cayman Islands at that stage? A Yes. Well, he didn't say otherwise and I -- no, he 25 didn't indicate it. 26 it was being moved. 27 476 Q 28 29 He definitely didn't indicate Your evidence about this, did you see Mr. Collery subsequent to that or have any contact with him? A 1 2 477 Q 3 A 4 478 Q 5 A 6 479 Q 7 A 8 480 Q 9 A 10 11 Have you? Yes . When was that? About six months ago. Can you tell me about that meeting? Well, he...(INTERJECTION). How did that arise? I think he just told me that everything was all right. 481 Q 12 Sorry, no. How did the meeting arise? Did you contact Mr. Collery? 13 A 14 482 Q 15 A 16 483 Q 17 A 18 484 Q 19 A 20 485 Q 21 A 22 486 Q 23 A 24 487 Q 25 A 26 488 Q 27 A 28 489 Q 29 A No, I didn't contact him. Did he contact you? He must have rung me, yes. He must have rung you? Yes . Did he ring you? Yes, he did ring. He rang you? Yes . What did he say to you on the telephone? That he would come and see me. That he would come and see you? Yes, if I wanted, but everything was all right. He would come and see you if you wanted? Yes . But that everything was all right? 1 490 Q 2 3 Why did he think that he needed to reassure you of that? A 4 Well, I mean I suppose it was because of everything that was happening in the newspapers, you know. 5 491 Q 6 A 7 492 Q 8 A 9 493 Q 10 A 11 494 Q 12 A 13 495 Q 14 A 15 4 96 Q 16 A I see? I would...(INTERJECTION). Yes? You know. That you might have been worried? Yes . Did you say you would like him to come to see you? No, I didn't. However, he came? Yes . He came even though you did not want him to? I didn't say -- he came but I didn't say I didn't 17 want him to come but he reassured me that everything 18 was all right. 19 497 Q 20 I am sorry. This is not very clear. You say he rang you? 21 A 22 498 Q 23 A 24 499 Q 25 A 26 500 Q 27 A 28 501 Q 29 A Yes . And he said he would come to see you if you wanted? Yes, yes. You presumably said, "Well, yes, do." Yes . "I will not stop you"? I wouldn't be rude to him. Yes. So he came to you? 1 502 Q 2 A 3 503 Q 4 A 5 504 Q 6 A 7 505 Q 8 A 9 506 Q 10 Right. Just that? Yes . And nothing else? No. He could have said that, of course, on the phone? Yes . When he came then, did he bring any documents on this occasion? 11 A 12 507 Q 13 A 14 508 Q 15 A 16 509 Q 17 A 18 510 Q 19 A 20 511 Q 21 22 He told me that everything was all right. No. You are quite sure of that? Yes . He did not bring a statement of your account? (INDICATING). No. Are you saying no he did not? No, he didn't. He did not? No. Did he tell you anything more about it on that occasion? A 23 No, he just told me everything was all right and not to worry about anything. 24 512 Q 25 A 26 513 Q 27 A 28 514 Q 29 A What did you ask him about it on that occasion? I didn't ask him anything. Nothing at all? I just asked him if everything was all right. What did you mean by that? 1 515 Q. 2 A. 3 516 Q. 4 A. What might not have been all right? Yes. What might not have been all right? I don't know. It is a sort of natural reaction I 5 suppose under the circumstances to say was 6 everything all right. 7 517 Q. 8 A. 9 518 Q. 10 A. 11 519 Q. 12 A. 13 520 Q. 14 A. 15 521 Q. 16 A. 17 522 Q. 18 A. 19 523 Q. 20 Did you mean was the money still there? Yes, I suppose so. And he said it was? Yes. Yes. Did he say where it was? No, I presumed it was...(INTERJECTION). Right. That was about six months ago? Yes. Have you been in touch with him since? No. Not at all? No. In relation to the lodgements that you made from time to time to the trust, to the account? 21 A. 22 524 Q. 23 Yes. Both before Mr. Traynor's death and -- did you make any since his death? 24 A. 25 525 Q. 26 A. 27 526 Q. 28 A. 29 527 Q. I don't know. I can't remember. Well, you...(INTERJECTION)? I would have to look. Yes? I probably did, you know. Yes? 1 2 close until -- I must have done an odd one since his 3 death, since 1994, yes. 4 528 Q. 5 A. 6 529 Q. 7 A. 8 530 Q. 9 A. 10 531 Q. 11 A. 12 How would you have done that? I would have done it through Padraig presumably. You would have contacted him? Ms. Mason would have done it again. And...(INTERJECTION)? Through him. How would you have contacted Mr. Collery to do that? If there was anything it went through Roadstone, through the office there. 13 532 Q. 14 A. 15 533 Q. 16 A. 17 534 Q. Through Joan Williams, was it? Well, that is up until...(INTERJECTION). The secretary of Mr. Traynor? Up until it finished, yes. In relation to these lodgements, I think the Judge 18 asked you there earlier if you had paid tax on the 19 interest that accrued to the account, were the 20 lodgements that you made, money that had been 21 declared to tax? 22 A. 23 24 535 Q. Right. When you say "tax free" this would be in relation to the stallions? 26 A. 27 536 Q. 29 It was either tax free or it had all been taxed. 25 28 Yes, it had all been. The stallions, yes . Yes. What do you propose to do about your trust now Mrs. Rogers? 1 537 Q 2 A 3 538 Q 4 A 5 6 To be truthful with you I wish it never existed. Pardon? Pardon? I said to be truthful with you I wish it never existed. 539 Q 7 Yes. Very good. I don't think I have any further questions. 8 A 9 540 Q Thank you. Thank you very much. 10 END OF EXAMINATION OF MRS. SONIA ROGERS BY 11 M S . MACKEY 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 2 3 4 541 Q. MR. JUSTICE COSTELLO: 5 Just before that Mrs. Rogers, I just want 6 to understand your evidence. 7 statement you were entitled to £2 million in 1997? 8 A. 9 542 Q. 10 A. 11 543 Q. 12 A. 13 544 Q. 14 A. 15 545 Q. 16 A. 17 546 Q. 18 A. 19 547 Q. 20 A. In the Cayman. 21 548 Q. In the Cayman? 22 A. 23 549 Q. 24 A. 25 550 Q. 27 A. 28 551 Q. 29 Yes. Do you know where that is today? Do I know where it is? Yes? Well, its presumably...(INTERJECTION). Do you know where it is? The answer is yes or no? Yes. You know where it is? No, not definitely, no. Indefinitely, do you know where it is? Yes. Where is it? Yes. Your money is in the Cayman, this fund? Yes. When it says there that it was withdrawn, did you know it is was withdrawn? 26 According to this No. The £2 million was withdrawn? 1 552 Q. 2 When you say it is in the Cayman, do you know the Institution in the Cayman in which it is? 3 A. 4 553 Q. 5 A. 6 554 Q. 7 A. 8 555 Q. 9 No. You do not? I thought Guinness Mahon. Sorry? I thought Guinness Mahon Cayman. No. However, it is not a question of what you think. If you wanted the £2 million how would you 10 get it? 11 it? 12 A. 13 556 Q. 14 If you wanted it tomorrow how would you get I suppose I would contact Padraig. You would contact Padraig. He is looking after it for you? 15 A. 16 557 Q. 17 I presume he is. Yes. Very well then. If we wanted to contact Ms. Mason? 18 A. 19 558 Q. 20 A. 21 559 Q. Yes. Can we find her at your address? Yes, you can, Judge. What I want you to get for us is all the documents 22 that you have in your possession, either at home or 23 wherever they are, in relation to your Cayman 24 business and in relation to the Cayman trust that 25 you have. 26 relation to it. 27 A. 28 560 Q. 29 All the documents that you have in Where are those documents? I don't have any. You are going to have to look then with your 1 2 Yes, Judge. 3 Yes. 4 to produce for us all the documents in your power or 5 possession in relation to the Cayman Trust, in 6 relation to the business that was carried on with 7 the Cayman companies. 8 another interview but in the light of documents we 9 asked for me we will consider the position. I see. 10 you? 11 Thank you. Very well then. We will require you We may have to consider 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED. Thank 9w 0M5 \buskurx - 9k hu?ms); 300? My husband Tim Rogers died on 1 January 1984 and some time after his death Des Traynor told me that my husband had shortly before he died established a discretionary trust abroad for my benefit. My husband suffered from leukaemia and I know that he had been reorganising his affairs before he died. When Des Traynor spoke to me 1 was aware that my husband had established a discretionary trust in Ireland in his W ill and had also established two separate trusts o f different lands all for the benefit o f my children and myself. 1 do not recall if Des Traynor advised me that the trust was established in the Cayman Islands but he did indicate that it was a discretionary trust. I do not recall if it was at this meeting or at a subsequent meeting that Des Traynor advised me that the trust was involved in bloodstock. Tim Rogers was an internationally known bloodstock breeder and a substantial part o f his income was derived from the sale o f nominations and stallion shares. Over the years the trust traded in bloodstock through a company called Ascot Holdings Limited and subsequently Ascot Ventures lim ited. Most o f the horses purchased by this company were held at our studs in Ireland and this arrangements was on an arm’s length basis and keep fees were charged to this company. In 1991 the trustees of a discretionary trust, established on my late husband’s death following a change in the Capital Acquisitions Tax legislation, appointed all o f the trusts assets to me. I continued the business which included trade with Ascot Holdings Limited. I met Des Traynor from time to time over the years and in 1993 mentioned to him that I had purchased a property in Dublin and was in the course o f constructing three apartments there. I also said that I was doing substantial work in Grangewiliiam House, Maynooth, Co. Kildare which I planned to live. Des Traynor said that he would arrange with the Cayman trustees to make some appointments from the trust to help fUnd this work and payments were made for this purpose over the next few years. ouncCovertibe The bloodstock interests o f the trust have been w oundjow the years. At this stage the trust fund has not been appointed. 24 March 2000 Sonia Rogers. / “s Appendix XV (114) Mr John Savoy 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r John Savoy. a) Credit guarantee between G M C T and Southeastern Commodities C o m p a n y Inc. b) Guinness and M a h o n credit committee minute of 21 March 1984. c) Internal Guinness and M a h o n file note of 12 December 1984. d) Print-out of a/c statement of 7 December 1984 re Southeastern Commodites Limited. e) Letter of 27 August 1984 - G M C T to Guinness and Mahon. f) Letter of 30 April 1984 - G M C T to Guinness and Mahon. g) Letter of 26 March 1984 - Guinness and M a h o n to G M C T . h) Letter of 15 March 1984 - G M C T to Guinness and Mahon. i) Undated letter - M r John Savoy to G M C T . G u aran tee By Individual(s), Partnership or Companies) To M a n n lafcai 6iym> Tint ( M M (hereinafter called "the Bank" which expression shall include and extend to theirsuccessors and assigns) Uawrtakfag 1. Where the Customer Is in U ;Partnership enter names of Partners of trade name (ifany) IN CONSIDERATION of the Bank making or continuing advances giving time for payment or otherwise granting credit or affording Where the Guarantor is in partnership enter trade name Customer”).......................................... ...,, ' / banking facilities to .. * ? . . . . 0>?r.?3>.'7?As...... . Gq u C M Y. . . . /r f /v .................................................................................... ................................ (hereinafter called “the .... .......... .Tp.V\*V. . ftV...................... ........................ ........ (hereinafter called “the Guarantor") H E R E B Y UNDER T A K E S upon demand by the Bank to pay and satisfyto the Bank all moneys which are now or shall at any time hereafter be due or owing to the Bank on any account and in any manner whatsoever by the Customer whether as principal or surety and whether solely or jointly with any other person or persons and to discharge on demand all other liabilities certain or contingent incurred by the Customer or for which he may be liable to the Bank in respect of acceptance or documentary credits discount facilities currency and any other transactions howsoever and all liabilities by way of guarantee or indemnity undertaken to the Bank by the Customer together inallcases with interest(as well after as before judgement) charges commissions expenses legal costs and charges pertaining to or occasioned by this or any other security the Bank may hold forthe aforesaid moneys and liabilities. PROVIDED A L W A Y S that the total amount recoverable from the Guarantor hereunder shall not exceed the sum of........... in addition to (0 such further sum for interest on that amount or on such less sum as may be due or owing (and also all Bank charges in respect thereof) as shall have accrued due or shall accrue due to the Bank within six months before and at any time after either the date of demand by the Bank upon the Guarantor for payment or the date of the determination of this Guarantee pursuant to any notice of determination as hereinafter provided and (ii) all costs and expenses recoverable from the Customer and all costs and expenses (on a full indemnity basis) arising out of or in connection with the recovery by the Bank of the moneys due to the Bank under this Guarantee which the Guarantor hereby agrees to pay. latenst 2. This rate of interest is only applicable when the terms of the facility are not maintained Interest accruing due to the Bank under (i)above after the date of demand or determination of this Guarantee as herein mentioned shall be calculated at. .'qJ?Cw$. . . 9.Q. far.. . s f i. . ... .. arisilfction The Guarantor agrees that in the event of the Bank taking proceedings hereunder the Bank may in its absolute discretion bring them inthe Courts ofthe Cayman Islands orany othercountry which it may deem suitable and for the purposes of those proceedings the Guarantor hereby sumits to the jurisdiction of the chosen courts and agrees that any writ notice judgement or other legal process or document relating to such proceedings may be served on the Guarantor by delivery to orservice on him or hisagent in the Cayman Islands being 18. of or elsewhere as the case may be. This Guarantee shall be construed and take effect according to the law of the Cayman Islands in force at the time any such proceedings are begun. + Dalgltlan ■argiial . Botes ; .) 17. 18. In this Guarantee where the context so admits words denoting the singular number only shall include the plural number also and vice versa. Words denoting the masculine gender only shall include the feminine gender also and words denoting persons only shall include companies and this Guarantee shall be construed and take effect accordingly. The Marginal notes are forthe purposes of reference only and shall not in any manner affect or restrict the interpretation of this Guarantee. This Guarantee is and will remain the property of the Bank. SIGNED, SEALED & DELIVERED by the said in the Presence of:— SIGNED, SEALED & DELIVERED by the said in the Presence of:— NAME OF A P P L IC A N T : ^ tv fe £z*rc C'*>C / * * - U i^' fa * ,fe u # ^ ’J w 3 3 c £ e AM OUNT: Co^hMP PURPOSE: TERM: ^ /% e«.c£ ^ ^ M 4 <2e>^ J fe # - '/"?< ?ST. SOURCE OF REPAYMENTS: ^ © FA TE, J £ fc ^ <**> COMMITMENT F E E : DRAWDOWN: ^ ^ S E C U R IT Y : REVIEW D A T E : ^ A A z& - ^ ^ V A N T COMMENTS FOR IN C O R P O R A T E I N D E C IS IO N MEMO. (C o n tin u e d O v e r l e a f ) : ^ /. < ? .«,.,£ ^ v / / , W 5 South Eastern Commodities Co. Incorp. U.S.S242.000.00 On the instructions o f Mike Shields o f Guinness Mahon Cayman Trust the above loan account and deposit accoutrt w ere closed o ff value ’ . 15th Decem ber, 1984 The balance outstanding on the loan of U .S.$255,256.22 was repaid by transfer from the backing deposit of U .S.$254,476.44 plus a rem ittance o f the residue o f U .S.$779.78 to M anufacturers Hanover Trust, New York. A breakdown o f the above figures i are as follow s:. Deposit . Balance ............................. ..U .S.$242,000.00 Interest to 20.11.84 ....... .... U .S.$ 9.895.11 . U.S.$25i,895.1I Interest to 15.12dS4 ........ U S.$ 2.581.33 . U .S.$254,476.44 Ijp/sc . 12th Decem ber, 1984. • •r' ; Loan Balance .................... U .S.$242,000.00 Interest to 20.11.84 ...: U .S.$ 10,513.55 . . U .S.$252,513.55 Interest to 15.12.84 ... U .S.$ 2.742.67 : . U .S.$255,256.22 \ n 11/12/84 16:31:42 Account Statement 7263015 USD SOUTHEASTERN COMMOD EXTERNAL OFFSET LOAN Balance Post Amount .Value Narrative 242.000.00DR ! *« START BALANCE 10,285.00DR 04SEP84 INTEREST 242.000.00DR 10.285.00CR i LODGED 10,513.55DR ^JDEC04 INTEREST TO 201184 2,742.67DR W INT TO 141284 254.476.44CR LODGED VALUE 151284 0.00 779.78CR LODGED VALUE 151284 11/12/84 16:34:17 count: 7510004 USD GAccount UINNESS Statement R E S O U T H EA S?ER N A CONM ODflflisN A L °FFSE? D/* 'alue Narrative Post Amount Balance , _ ** START BALANCE 242.000.00CR 04SEP84 INTEREST 9.680.00CR DRAWN 9,680.00DR 242, OOO.OOCR 2707DEC84 INTEREST TO 301184 9,895.1ICR n INT TO 141284 2.5B1.33CR DRAWN VALUE 151284 254,476.44DR 0.00 2G in 30 • # "'GUINNESS MAHON CAYMAN TRUST LIMITED A Mambir of tha Guinnass Mahon Marcham Banking Group Talaphona No 9 -4653 4 P 0 Box 887 Talax Grand Cayman CP 305 Cabi* Address Guinnass British Waat tndias your raf ourraf ' J R F /fd e f 2 7 th A ugust 1984, ^ P a t O ’ Dw yer E sq . G u in n e s s & M ahon L t d . 17 C o lle g e G re e n , D u b lin 2 . IR ELA N D D e a r M r. Re: O 'D w y e r , S o u th E a s te rn C o m m o d itie s Co. In c . I e n c l o s e c h e q u e f o r U S $ 1 0 , 2 8 5 . 0 0 , e n d o r s e d I n f a v o u r o f G u in n e s s & M ahon L t d . T h is r e p r e s e n t s th e i n t e r e s t due as a t 2 0 t h A u g u s t on th e n o te f o r $ 2 4 2 ,0 0 0 . W o u ld y o u p l e a s e p a y t h e i n t e r e s t o n o u r d e p o s i t , u n d e r a d v i c e t o M ik e S h i e l d . T h e i n t e r e s t s h o u ld o u r l !S$ 7 - d a y n o t i c e a c c o u n t a t G . M . L o n d o n . Y o u rs s in c e r e ly , - ''I M ' J '- s L .r - l l '' John R. F le tc h e r . as be b e fo re , c r e d ite d to 0 • GUINNESS MAHON CAYMAN TRUST LIMITED A Member of the Guinness Mahon Merchant Bonking Group Telephone No 1809 941 9 4653 4 P 0 Box 887 Telex 10293) CP430S Grand Cayman Cable Address Guinness British West Indies A p r i l 30, 1984 your ref our ref JAF/mb Pat O 'D w yer, Esq. Guinness & Mahon L td . ...17 C o lle g e Green D u b lin 2 IRELAND Dear Pats He: SOUTHEASTERN COMMODITIES CO. INC. I have ple asure in e n clo s in g herew ith the personal guarantee form d u ly signed by John Savoy. I should be g r a t e f u l i f you would k in d ly acknowledge safe re c e ip t in due c o u rs e . Yours s in c e re ly , Appende ?1 -- fe d * fa * 26th March, 1984. Our Ref: PO'D/ML Mr. John A. FurzeJ Guinness Mahon Cayman Trust Ltd.* P.O. Box 887 Grand Cayman, British West Indies Der John, Thank you for your letter of the 15th Inst*, setting out the position In relation to the new deposit of US$ 242,000 In our bodes In the name of G.M.C.T. and the loan of equal amount to Southeastern Commodities U Incw, Both entries have beaa value dated 20th February, 1984. As requested I have pleasure In enclosing a guarantee for completion and return In due course. On receipt of same I will arrange to cancel the G.M.C.T, guarantee. . Kindest Regards Yours sincerely, . for GUINNESS + MAHON LIMITED, Pat d’Dwyer, Banking Manager. GUINNESS MAHON CAYMAN TRUST UMTTED A M im b tr ofthe Guinn*** Mahon Merchant Banking Group T elep h o n e No 1809 94} 9 4653 4 P 0 B o x 887 T* m (02931 C P 4305 Grand C a y m a n Cable A d d r e s s Gui n n e s s British W e s t Indies March 1 5 , 1984 your ref our ref J AF / mb Pat O'Dwyer, Esq. G u i n n e s s & Ma hon L t d . 17 C o l l e g e G r e e n Dublin 2 IRELAND j. ■ Dear Pats I n o u r b o o k s we h a v e e s t a b l i s h e d a) b) the following:- D e p o s i t o f U S $ 2 4 2 , 000 f r o m Co o l B r e e z e I n v e s t m e n t C o r p o r a t i o n ( a Ca y ma n c o mp a n y u n d e r o u r m a n a g e m e n t ) v a l u e 2 0 t h F e b r u a r y 1984 m a t u r i n g 2 0 t h F e b r u a r y 1994 a t 15% p . a . ( i n t e r e s t t o b e p a i d q u a r t e r l y on r e c e i p t o f loan i n t e r e s t - see below) D e p o s i t o f U S $ 2 4 2 , 0 0 0 by G . M . C . T . w i t h y o u r s e l v e s a t 16% p . a . on i d e n t i c a l t e r m s a s t h e a b o v e . Wo u l d y o u k i n d l y r e c o r d a d e p o s i t f r o m u s p e r ( b ) a b o v e a n d a l o a n a t 17% p . a . t o a F l o r i d a C o r p o r a t i o n , S o u t h e a s t e r n C o m m o d i t i e s Co m p a n y , I n c . o f Po mp a n o B e a c h , F l o r i d a . Enclosed is the o r i g i n a l documentation in support of the l o a n w h ic h p e r h a p s you would keep i n s a f e c u s t o d y - I have r e t a i n e d c o p ie s h e r e . However, s i n c e th e g u a r a n t e e e x e c u t e d i s a G . M . C . T . g u a r a n t e e , p e r h a p s y o u w o u l d l e t me h a v e a G & M one f o r c o m p l e t i o n and e v e n t u a l s u b s t i t u t i o n f o r th e form e n c lo s e d . We p r o p o s e t o c o l l e c t t h e i n t e r e s t q u a r t e r l y on y o u r b e h a l f a n d w i l l b e s e n d i n g y o u a c h e q u e f ro m w h i c h you c a n t h e n p a y i n t e r e s t on t h e d e p o s i t a n d we s i m i l a r l y c a n p a y o u r client. ____/ 2 / i f ....... - 2 - Perhaps you wo u l d any p r o b l e m s . Best let me know w h e t h e r ■ foregoing wishes, Yours Enel: the sincerely, presents Guinness Mahon Cayman T ru s t L td. PO Box 887 Grand Cayman, BWI Dear S ir s : In my c a p a c ity a s s o le b e n e fic ia l, owner of' th e e q u ity o f COOL BREEZE INVESTMENT CORPORATION LIMITED, I hereby confirm t h a t you may h y p o th ecate US$242,000 o f th e funds p re s e n tly s ta n d in g on d e p o s it in th e name o f t h a t c o rp o ra tio n , to se cu re len d in g o f a l i k e amount by SOUTHEASTERN COMMODITIES COMPANY INC. from Guinness & Mahon L im ited, o f 17 C ollege G reen, Dublin 2 , I r e la n d . I understand t h a t i n t e r e s t w i l l be payable by you on th e a fo re s a id d e p o s it a t a r a t e o f i n t e r e s t c a lc u la te d a t two p e rc e n t p e r annum l e s s than th e i n t e r e s t r a t e a p p lie d to th e fo re g o in g lo a n , and t h a t such d e p o s it i n t e r e s t w i l l only be p aid by you upon r e c e ip t by Guinness & Mahon Lim ited o f th e loan I n t e r e s t due from S o u th e aste rn Commodities Company In c . W ithdraw als from th e aforem entioned d e p o s it can only be e f f e c te d pro ta n to to c a p i t a l lo an repaym ents made to Guinness & Mahon L td . D ublin by S o u th e aste rn Commodities ComDanv. In c . JOHN SAVOY W itness Address: 1080 S . W. Occupation: 1 2 th A ve n u e , Pompano B e a ch , F l a . M anager____________________ 33069 Appendix XV (115) Schwartz Management Company 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Schwartz Management Company. a) Letter of 22 June 1983 - Central Bank of Ireland to Guinness and Mahon. b) Deposit Agreement between G M C T and G M C T as trustee of Schwartz Trust. c) Letter of 26 August 1982 - M r Ben Schwartz to Guinness and Mahon. d) Internal Guinness and M a h o n review meeting m e m o of 30 January 1984. APPENDIX XVI JA 22 June 1983 S tr ic tly Confidential t Hr. O.H. 6u1nness Chalraan Guinness 4 Mahon M alted 17 College fireen DUBLIN 2 Bear Mr. Guinness I r t f e r to th e la te s t Inspection by Central Bank tx a a ln trs o f th t books and rtcords o f 6u1nnass 1 Mahon M alted and wish to convoy tho Bank's appreciation o f tho co-operation rocolvod during tho court* o f tho examination. Hhlle tho outeoM o f th e cxaalnation was generally satisfactory* fhe Bank wishes to Mko tho following observations:* Capital M w i w Wo are glad t o nota th a t tho cap ital sh o rtfa ll In your bank re la tiv e to our proscribed alnlaua free resources r a tio o f 10 per cont. has now boon re c tifie d as a re s u lt o f tho laprovw en t In p ro fits and tho ta le o f shares and th a t tho proposed Introduction o f £1.25 B illio n S tarling subordinated loan stock In the near future w ill fu rth er strengthen tho cap ital p o sitio n . U rg e loans The loan o f US$10.3 *11 lion to the Schwartz NanagaMnt Ceapany has caused tho ra tio s fo r the la gost loan and ten la rg e st loans to exceed the respective aaxina o f 5 per cent, and 30 per c e n t, o f ris k a ss e ts. Notwithstanding the fa c t th a t the loan In question 1s securcd by a aatcMng d ep o sit, tho Bank w ill wish to keep such loans and th e ir lepact on t h t ratlo&undor regular review. l e n s AdHnlstra tton In recent m etlngs with th t Mnaganant of your tank the s t i f f o f our Supervision Department have indicated th at they Mould wish to see certain InprovsMnts fn tho loans' administration area. While w* understand th a t sow progress has been Mde fn th is area In recent aonths* wo contlnuo to foal th at there 1s scope fo r fu rth er InproveBonts. Provision fo r Bad and Doubtful Debts The Bank 1s ploasad to itota your policy with regard to provisions for bad and doubtful debts, p articu larly 1n relation to tho addition of £20.000 per aenth to th t general reserve. Tho exaalners were also s a tisfie d with the level of the bank's specific provisions. P ro fits , We note the significant improvement In p ro fita b ility since tho la s t Inspection In 1978 and p articu larly In the y w r ended 30 April 1982. Me understand th a t th is satisfacto ry trend 1s continuing 1n tho current y ta r despite the d iff ic u lt economic conditions prevailing and th a t the p ro fit for the 17 month period ending 30 September 1983 w ill be ahead of budget. The Bank would appreciate any consents you nay with to make a fte r your Board has considered the various Matters to which I havo referred above. ' DXPO Srr A G REEM EN T BETWEEN G U I N N E S S M A H O N C A Y M A N T R U S T L I M and c u u n n s s mahoh caym an t r u s t . ; X . lim ite d as tr u s te e o r th e s c h v a itz t iu s t of ^ I T E D . G u in n *** M ahon Cayman T ru s t L im ite d • • T c u a ta a have deposited for credit o f an account Guinness Mahon Cayman T n o t Lim ited the sum o f 1IS $ 9 .7 a t llt o n on tha following tram : that tha w in shall not be repayable to It u n til repayments mad* to G u inn ess h Mahon L td . o f D u b lin , Ir e la n d by S ch w arts Managesaent of equals th t differential between tha adtsncs mads to them o f U S $ 9 .7 m illio n andtfeeaforesaidam ountdepoaitsd.Thereaftertha depoait thsE not ba rspaid except pro tanto to loan repayments mada to G u in n ess & Mahon L td . that iflta m t psyabla on this deport wffl ba equal in interest reeatired by G u in n ess & Mahon L td . under tha tanna o f the loan Usa 1 % par annum o f tha amount hstd by you fa r tha time being to tha endit o f its account. that Interest may be claimed by it only aa and when interest is received on tha Mid loan by G u in n ess ft Mabon L td . that in the event o f any default by S ch w arts Managem ent tha depoeit and any accrued interest may ba forfeitad by you pro tanto to tha amount o f such d eftu lt. 5. that although tha aaid deposit may ba forfeited by you in accordance with the above, tha specific deposit and tha benefit o f this letter may not be assigned, pledged or eollatcraUaed in any way (n favour o f G u in n ess & Mahon L .td . or any other ptison, Ann or company without its prior w ritten consent. ' 6. that you act as principals to tha receipt o f tha depoeit and not as agents for C u ln n aaa & Mahon L td . 7. that if you perm it the withdrawal o f any part o f tha turn meh permission dudi is regards the balance o f the sum and any unpaid interest thereon be without prejudice to tha rights hereby conferred on you and such permission shall not constitute s waiver thereof. *■ this Agreement shall ba construed according to the Laws o f the Cayman Idanda which shall be the forum 1 . for the enforcement o f this Agreement or any proceediagi arising out o f M. 520 WalnutStri« « ft ( : M . 0 9 .9 9 . G ssh F la r / R e n ta l C h arg ee R eduction £ 4 ,0 0 0 p a r n m t h to c o a t Ion*. R a ta : B a ta on th e L o an . U aaaI c h a rg e * on th e L e c te ta o f C r e d i t , S e c u rity : 1. Blank Trans fa r consisted over 3 .1 9 4 Hbstaerd Cables Ltad tad , O rdinary Shares. 2. Blank Transfer caqpleted over 102,000 Wbsmard Csbles Lim ited 20K Preference Shares. . C 9 . G uarantee sig n e d by Jo sep h S e e ly . S e c u rity n a y b e ta k e n e s a d e q u a te f o r Loon £119,000. T o ta l E xposure: £139,000 Aanwixxviu Bruce : As requested I list hereunder particulars of the Accounts for which we hold backing deposits from GMCT : a) b) Non Resident Accounts ( which are included in the full set- off category for Central Bank Returns : ’ Resident Accounts for which we hold deposits from GMCT duly hypothecated c) Resident Account for which we hold deposit direct from Olympic Investments, which is a Cayman Company : - d) College Trustee clients for whom College have arranged backing deposits here through G.M.C.T. : - Histon Regards, Michael J. Pender Securities 126,388.22 IR 25/10/00 12:56517 ^'C trtifiaacN o...... COMPANIES ACTS, 19*3 to 1 M , ANNUAL RETURN O F :- immtbt mtprtsud lure. ....... ....... fillft'if 3 1 ... ..day a I — ----- -— T f e e g £ etd & N o acJwpfcalwiMWft*eAMMlOBMnlMiiilhKfcrttB Mcflaft!B „~T\ W>JJ nadeaptotfce (U-V* del. 1 A d d ress i 5H A R —*O 2> / * w (M h n ^ A rx j£>. 2 S it u a t io n o f th e R e g is t e r s o f M e m b e r s a n d D e b e a t u r e - h o ld e r s to /**» ». **fefc A t rwgb ttr o f mmmbtn h k tft, if m m t Am i tte rrglotrtd eampmtf) W ojfce tfcr Of —y # **_ off oT ___ngfimrtd <*fct MRMQP wlift ^9 * Aot f mj f ibf COfMfNMQT lr Jbqtf). THIS RETURN MUST BSSW N B1 ON PAOCS BVTHS SECRETARY AND A DIRECTOR OF THE COtAPANY As i at t f — — or D eG vertdforfiib tg by af t m 6 f t f c i h r m m M m to t a n to Aa aaa* to I ■ M i i n , to • > ftNftftr 4 Plw ctoia M t f t t o t w tor Sactkm MS M t to n u r t a i i «Hh SkHm M * to* C t o i a k i Act. IMS. Hnwy pcnlttn ire M i to M t a 3M of tot Act tor M a n to catortr « M tkao raqafcaw att aid tor J. lT,r l !im Y f‘wrk-ftooA' -> 25/10/00 12:56:46 2833929 r 3 SU M M A R Y O F SH A R E (a) Nominal Share Capital N om inal Share C ap ital£ ...../.Q Q ................ divided into: i Insert num ber o f C lass) /QO .shares> of... JrO-...'........... sach ..shares of..................... iach ..shares or..................... each ..shores ot.‘.....................each (£>) Issued Share Capital and Debentures Num ber A N um ber o f shares o f each class taken u p to th e d a te o f this return (which num ber must agraa w ith the total shown in the list as held by existing membersV l , .. Otares .. shares .. shares .s h a re s N um ber o f shares o f each class issued subject to paym ent wholly ia cash. ..s 3 L .A l .sh a re s .sh a re s .sh a re s .sh a re s N um ber o f shares o f each class issued as fully paid up fo r a consideration oilter than cash. Numb** ri*ff N um ber of shares of each class issued as partly p a id up for a consideration o th e r th an cash a n d th e extent to which e a c h such sh a re is so paid up. issued as p a id u p to th e of £ .............. p e r share. shares issued as p a id up to th e extern of £ .............. p e r sh a re. shares issued as p a id u p to th e extent of £ ....'....... p e r share. shares issued as p a id up to the extent of £ .............. p e r share. Num ber N um ber o f shares (if any) o f each class issued a t a discount. C la ss lhi% margin « rrxfrvrtl fur binding md must not be written across C la ss 25/10/00 1Z!5?:08 ° -> C A P IT A L A N D D E B E N T U R E S Amount of discount on (be issue of shares which has not been written off at the date of this return Num ber ................par share on Amount called up on u m b e r of s h i m of each class .. S L . C ltss J / ,. shares £ . _ .................... per s h o e on .s h a n s £ ........................ per share on . shares £ ........................ per share oa .shares T o m amawnt of cafo receded iodm & n payments o n application and attotment and any soms received on shares forfeited. C lass Total naanher o f shares of each d a ts Totaiasaoant paid, if w o j, oo ih are t forfeited N o n :—'Where > company Ins converted a n y o f t o staaies into stock. (ben. where appropriate, the references lo d u r a ia pnrapaph 3 shaX h e taken as n fm a c e c to slock and references «o number o f shares ih a l b e taken as references » aowunt o f stock. 4 PARTICULARS O F INDEBTEDNESS Total anooM of indebtedness o f rite conpeay in respect of all rooctgnes sad c h a n ts which are icoai ied to be legim ie d with the Registrar o f Cwnpanirs under the Com paaks A ct, 1963, o r which would have been required so to be registered if created after 1st July, 1908. 2 5 / 1 0 / 0 0 12 5 5 7 :3 4 f* 5 L is t o f P a s t a n d P r e s e n t M e m b e r s LitU)f persons holding shares in the c o mp any on die IW i »< U r «h cm ini w l n iliwi lm I9.40.and o( persons w h o have held shares thereia al any tine since the date of last return, in 1 hercase of the first return, of the incorporation of the company. [See Notes at toot of page] at Account of Shares Particulars of shares trans ferred since the date nf the last return, or in the case c N u m ber s ol the fiist return, of the ircorshares held poration of the company, by by existing («) persons w h o are srif m e m ber s membets and lb) persons at date of w h o have ceased to be ipemberst return •t Date of Naeiber Regiiiratioa ol t transfer i Folio in register ledger containing particulars Names. Addresses and Occupations ! («* Renaiiti 1 i1 1 1 1 . ..... t 1 j ............ » T h * totalnumber of share* h * M b* each aea*er must be staled. and the totals m u u he added up sc as ic agree* M i n e ciusscr a< snares stated tathe S u m a w y of Shate Capiat tad Debentures to have been ukea up. tWhe*thesharesarcop. ^ _ W hen ike d a m s m 0/ dO bnat dUMa ibne coteant afeauU be a M W M *0 *m tbc mmber of c u b claw bdd or m w fcncd m»> besfaovra j n n t d f . » tThe dMcofieaurttioa ol each uaader stoatd be i«ea w d as tie auaibec of sbarct m a s f e m d an a c b due. The putiaibn should be placed n m h d w maae of fee uanfeior and Mrtoppoutt ibaieftbt tnaH/mc. but ibe «ane of lb* uaatfeice m > be iaMrwd b Utt “Reaurt*" tobtnui ixmnetS»tcJ)i opposite lie puticuhn o{ cack uuala. ^ 6 P a r tic u la r s o f D ir e c to r s a n d S e c r e t a r ie s Particulars of tht persons *'ho are directors of the company at the date of this return: Present Christian n ame or naraet and surname A n y former Christian name or names and surname Bjarets occupation and particulars other directorship* or bodies corporate incorporated in the SOW 0: Usaal residential address Nationality if not Irish ...... w q <&#n M2s>......I...... £ft£ec5o/(i,. AiO W W AS § 3 « I E Pa rticu la rs o f the person who u s ttrtu ry o f b e com pany tt the date o f ju s retu rn : ■ I Name (In the ease of an individual, present Christian name or surname, la the ease of a body corporate, the corporate name) Any tam e r Christna n a m or name* and surname Usual residential address (In ihe case of a body corporate the registered or principal office) k*tO C K AU NG S A2)G nC £. MfcM££~r SeeLy C o . X j ME~£/&< Director . Thii return mutt be signed by the Secretary and a Director:— .Secretary M om ■Director- includes my person whooccupies the pscitioa of a director by whatsoever name called. and any person in accotdance with whose dwectioas or Hwructiaas the directors of the cotapaay are accnsMMd to act. "ClHisitan name" maades a Ineaane and 'tu n au u " in ih< v*m of a person musSy known by a tiik different (mm ki» winame. means that tide. "Former Quistaia u n e " and *formersttnumse" do not include— (a) in the case of a perton usually known by a till* different from tui surname, (he nam* by which lie was known previous to the adoption of or lucceMioa to the tide; or Ibl in the case of any action, a format Chrmiaa name ur uhbmc where that name or suroaaie waschanged or disused before be person bear­ ing ihe name attained (he a eof IS years or has been changed or disused for a period of not less thas 20 years; or 10 in the case of a named m m h . the name or sam tre by which she was knowr prestois to the msroajc. Tbc names of ill bodies cor^crjie incorporated j ike State of which the director is ahc a director, should be liven, txnpt bodiat corporate of which iht eempaay maklai the relwa i» the *bo:iy-ow«ted tubaidwr> or bodses corporate whic)) are the whotty-ewned nibsidiaries either of the company or of another bocy coiporaie af which th* company it the wholly-owned subsidiary A body corporate u deemed to be the wholly-owned sub tidury of another if It has no nembcts eioeps that v-bet and that nthe r's wholly-owned subsidiaries and its or their nominees. H ihe ipuceprovided in the tom it .niuffcient. putKulan uf other directorships should be listed on a separate statement attached to u ii return. Wheie all the partners in a ftto are joint secretaries, the name and principal office of the firm m y be stated. ! ^ CERTIFICATES AND OTHER DOCUMENTS ACCOMPANYING ANNUAL RETURN Certificate to be given by u d irta o r and the sto rm y o f fiery private com pany We certify dun the company hat not since the due o ft (lk» iampnrsa'sn sf lh» H m p a a y f t h r Iasi annual return) issued any invitation to the public to subscribe for any shares or debentures of the company. S ig M d _____ Sig n ed .......... tin the casa of the first strike aw (he lo t ahenntfve. strike out the second aktroativ*. In tha eata of a F u rth e r C e rtific a te to be g iven os afo resaid if r t f W e certify t in t the excess o f th e w ho, uatferjN m iN pfc (b )o f< in rc rtn m n g th e num ber o f Com pany exceeds 10 over SOconisb wholly o f persons Companies A ct, 7 W . are not to be included .......D ira e to r -Secretary C e rtifie d co p ies o f A cco u n t*: . . . . . Except in the case o f a company atoch b cxdnded or c tamp t from ihe ypflcatioa of secrio* 128 o f the anot te a m e d lotM s n a n a written copy, certified b o * by * director and by * e secretary a t the coaapany » be a n c copy, of every balance sheet M d before the anaual geaeml meeting of the company heM during the period to which this m um relates (faidadiag every document required by law lo be annexed 10 the balance sheet) and a copy (certified as aforesaid) of the icport o f the — item on, and o f the report o f the dfcecton accoaspanyiag. eacfa such balance sh eet . If any sack balance sheet or document required by law to be aanneed thereto is In a language other than or Irish them n e t also be anmrwd to that balance shaat a translation in En^bh or Irish of the balance sheet or riocamant certified in tbe prescribed manner to be a correct translation. If any such balance fbeet at afownrid or Jot ament required by law to be annexed thereto did not comply with the requirements of tha law as ia force at the date of the audit with respect to the form of balance ibeets or documents aforesaid, as the case may be, there must be made such adAioM to and correction in the copy as would haw been required to be made in * e balance sheet or document in order to make it comply with the said mqofeemeats, and the fact that the copy has been so amended mutt be stated thereon. C um p H ktB A a , 1 9 0 . t h m Banking Com panies' A banking company, in order to avail itself of tbc benefit of jectfon 375 of the Com pan ies A ct. 1963. must add to this return a statement of the names of the several places where it carries on business. Appendix XV (117) Mr Sidney Seymour, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Sidney Seymour. a) Extract of transcript of evidence of M r George Crampton dated 8 February 2000 . b) Letter of 18 August 1971 - M r D o n Reid to M r John Ronan. c) Letter of 8 March 1972 - M r D o n Reid to M r George Crampton. d) Guinness and M a h o n list of suitably secured loans dated 1974. e) Extract of Guinness and M a h o n Meeting of Board of Directors of 28 November 1974. Appenduxvaxmvm _ W F '" ’ . ' ..............7 r \ i 1 18 . 237 Q. M R. . . J U S T I C * C O S T lL L O s M r . . C ra m p to n , 19 c o n t in u e ' 20 lo o k a t 238 A. Yes. Q. I t h in k 24 That 25 T ru sts 26 th e re 27 29 th e n . W o u ld y o u t h is f ile o f d o cu m e n ts t h a t y o u g a v e u s y e ste rd a y ? 22 28 we w i l l J# 2 1. 23 . a 239 . is 8t h M arch 1 9 7 2 . f r o m K e n n e d y C r o w le y t e l l i n g y o u how t h e it is docum ent N o . 10 of w e re g o in g t o b e s e t u p . w e re t o be s ix Yes. Q. Do yo u s e e t h a t ? A. Yes. T ru sts Do yo u se t up, see E x h ib it th a t 1? rv 1 240 2 3 241 4 5 242 6 7 243 Q. W ere t h e s e A. C o rre ct. Q. W ere t h e s e T r u s t s A. T h a t, Q. X do n o t know ? A. No. Q. Y o u h a v e n o t t a lk e d t o y o u r f e llo w 8 244 11 12 A. T h e re Q. Who i s 245 246 is o n ly one a l i v e 247 18 Is A. C o rre ct. Q. Xs i t y o u r r e c o lle c t io n Q. Y o u u n d e r s t o o d t h a t t h e y w e re a l l A. Yes, but I Q. 25 250 s u c h a s y o u h a d o r G u in n e s s Z am s u r e 251 u n d e rsto o d Q. You a re A. T h e y p r o b a b ly h a d , Q- In ' & M ahon D u b lin ? th e y had. su re th e y had? yes. o t h e r w o rd s, yo u t h in k th e y c a r r ie d w ay a s y o u c a r r i e d 28 I J* D o y o u know w h e th e r a n y o f th e m h a d A n s b a c h e r A. 27 se t up? tru sts. a c c o u n ts su ch a s you had in 249 any . . . (IN T E R J E C T IO N ). c o u ld n o t c o n f ir m t h a t . 22 23 to f i n a n c i a l a rra n g e m e n t w as m ad e? X u n d e r s t o o d t h a t t h e r e w e re t h e r e w e re s i x 248 t h a t yo u d id n o t t a l k a cco u n ts 29 a ll th a t 21 26 at a t m o m e n t. A. 19 24 D ir e c t o r s th a t? o f th e m a f t e r t h i s 16 20 do- y o u know ? d o n o t know . Q. 15 17 se t up, o f yo u rs? A. 13 14 D ir e c t o r s about t h is ? 9 10 I f e llo w A. T h e y m ig h t , Q. Not fo r as on? b u t n o t f o r a s lo n g . lo n g ? on th e sam e 1 > C. Crampton. Your* sincerely, D. Raid »imiflCi»TiX'.\ DvK\\ AVlbmKulrylTA Ifdjptr Hdmit W’A KJwwl l«v#wi KVA llrim O'Cmwr ACW I livid Ibnr.- K W .U t SfMui Kl'A Cimutuiu (irmld WTwk-r Kl'A t^jncjpnl Maniwen Snrnn IMu IWr l^nrli DimRuM - i Kennedy Crowley &Co. Chartered Accountants Hainauk House 69/71 S t Stephen's Green Dublin 8 Telephone 757971 G.C. Craapton, l i ^ . , 9, Haple load, Dublin 14. . OK/SC IJbJ0 Se; Dm Cw m 8C& Kareh, 1972 Truata. Me C M to B , X am aoncy th«c I t 1m takas ao rather longer Co eamm back to you with tha d raft La tta r a t Wishes. I m vow aneloaing aix copies at this d raft ao that i t « y be conaldared by each of tha lndi-rldsula eeocarned. X think that tha texaa of tha la tta r ara fa irly aalf-explanatory and should not give riae to any yn b la M hut, ahmild anyone with to dlacuaa than w ith mm I w ouli bo happy to do ao. • Since x mmr you we have aaat to tho Cayman Xelanda tho reriaod draft Truat Deed, to *thn with tha data 11.t raqulxad to eoaqplato tha appointed elaaa in each eaaa. For aaoa o f rafarasao, and to avoid too amah id e n tifica tio n , w are ca llin g the Truata tho Whitethorn Traata. tour own w ill bo tha Whitethorn ▲ Tru st, K b Clark* a tha Whitathorn B Tru st, X r Xsst's tha Whitathorn 0 Tru st, X r Sayanur*^ tha Whitethorn B Tre a t, and Mr Vobb'a the Whitethorn T. Trust! • Aa boon aa tho Truata are drawn op X w ill have tha Lattax o f Wlahaa signed in each eaaa by Paul Barria '■ha la tha aa ttlo r. too finaal atapa w ill than raaaln to be taken, the f ir a t la tha formation by tha Truataea of a eoapany (o r eonpanie a ) to raeaive lncoae froardepoaita o r lnvaatnaata oa behalf of tha Cruateea. The eeeoad w ill bo tho execution by Paul Barrio of o Seed (in blank) assigning bia powers aa Appointor of tha truata. Youra e in e e re ly , K n c la . '• b o m *'a H * I V . ' I V r ln iiiiiiiM V . \ K il^ a r K u n h f > \ \ I 'U w t h l l\ .x jf a n F< \ l Ci ,j^ni ~ wocao saasaat lUuirMracar (1 ) lattrMUla OT*r * ;* • .1 H ffiS S *0,h»0u0 ..... . ? & « -J u .Q jo » .* .» m m n t. m*rn» M U p . t Appendix XV (118) Mrs Nora Shanahan 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mrs Nora Shanahan. a) Letter o f 27 August 1990 - Ansbacher Limited to Guinness and Mahon. b) Ansbacher Limited statement o f 14 October 1991 re a/c A /A 48. c) Letter o f 2 October 1991 - Ansbacher Limited to IIB. d) Ansbacher Limited statement o f 30 September 1991 re a/c A /A 48. e) Letter o f 29 August 1991 - JD Traynor to Mrs Nora Shanahan. f) Internal file note re Mrs Nora Shanahan o f 27 August 1990. w afar JW i y H C M m Jm ti Bm ik iig Grovp P.O. Bax M7, Gaad Ckyian, M H i W at U h Rmmb (MD MMtfS/4 Trine CP 4905 Tel:765144/763065 Rue 612035 Ftoc (IM) 949-7946 (>09)949-Safi7 27th August, 1990 N. David Humphries, Esq., Senior Manager - Operations, Guinness & Mahon Limited, 17 College Green, DUBLIN 2. Dear Oavld, Could you please arrange to let me have for collection when I am with you tomorrow a Sterling Draft for Stg.£5,000 payable to Nora Shanahan. . The cost should be debited to Ansbacher Limited Account No.13154602. 1 •ff.D. T ra y n o r \ A N S B A C H E R L IM IT E D P.O. Box 887 Grind Cayman BritishWest Indies. Telephone No. 8— 4663/4 Telex CP 305 Coble Address Guinness ■ C "Jfu?o*cfter L im ited Cavimn AM <18. L J BROUGHT FORWARD /1 0 / 9 * fMfSi M /1 0 /9 1 LODGED ACCOUNT NUMMR Q00C1R36 PAGE BALANCCl SHOWN ARf IN: P a r t i n g 1 7 764.52 30000.00 fi -V'V ._ » v . • . '• - ^ v.;V ' -r-^ ■' :v.t" /-• , V> >.v2ncl Octo.ber, '1991 E.sg.fV; V. •••'_;?/ t:inental i n e n t a l ;Bank Lirgitedy * r• » . ; .... . ;/ '/ *; E a r re tt Logan I r is h In te rc o n 9 1 M e r r i o n . S q u ai rr ee , " '>:• " / . v ^ ’’ V \ - D U B L I N : 2 -. . i. ” •* V«<. ^ ., ' , : - . j- \ -Y• A'■, . ■ ■ ■ ■D e a r ■■■;•■ G a rx e tt> you . . , • ; ■ •- p le a s e '" Y o u r s - s i n c e r e l y , "■■*'' .V ■'• ■ • •; ' ' , • v Y ^ . ': ^ ' ;••'••• . ^ ir^; / ' •" V "V . t 1* - t o . lo d g e ^ t h e .e n c lo s .e d D ^ fa ft .^ o r : > ’’ , " v-- - . , \ . •' arran g e S t g . £ 3 0 ,0 0 0 :t o '" c r e d i t N o .0 2 / 0 1 0 8 7 / 8 1 . ' . -^-V; J*^Ty^5**" ^ \ A - :' ’. v " :^ .-■■■. / : '■ •■• v . . .: C o u ld •: - .. ■• ■ • •Y ’*7*??. ’ .3% , ' o f : l- ,: A n s b 'a s c h e i r L i n i i t ^ d ; < A c c o i i r i t ^ ‘ V ! - / ' ^ ' ’ • . ^ •->- . v‘ ^ For ANSBACHER LIMITED ' '" " . •* ; . .. I* ' V >A ■ *. U V V li '- ' ' ” ..... ,V ’ ...-T"^S2{U ?Jr\ 1 D PC JD T /A JW 1 ‘ ;l ^ ■.v; ■*' ;■* ■'■*•: ^.',r ** .. ■•' '~ ■/ ^ ’,-r' '• ‘ . 1 * \ ^ r;&* c, i V s t m i rj r oi ,.r< >m -j t A N S B A C H E R L IM IT E D P.O. Box 887 Grand Cayman BritishWatt Indies T elephone No. 9 —4863/4 Telex CP 306 .CableAddress Guinness rasbecher Limited Cayman V » jit J (>_ 11/ 8/9! 5/ 9/91 JO/ 9/91 2/ 9/91 30/ 9/91 M 0U 8H T PORM MM) DRAFT Interest to 30/ 9/91 ACCOUNTNUMB8H 80001838 1A1ANC18SHOWNAH8ttfc «t»rl infl 6000.00 561.47 , £ "■ 22213.06 17213.06 . .' "siW ■ M .1 ^ • ‘ V-M * ’• ?> .■34 •-I .1 -- ■ CAWwaroRWAWQ. ......•'•’i# 17784.52; PERSONAL •■■, ■’■' M r s .. N o ra 8 C lifto n l o v id o n w q N o ra '*• "•' •... ' ; • ' ". '' ’I ';‘V*".*■•>■' fi5' Shanahan, G ard en a, id t . : I 'D e a r . ' " ■■■■ ■' .' ' ; . - i '. ' ' V" ; . \V4; v ; • i .‘ ^ ' ;• - •' ".. "■ : : vr/' ^ V -v ^ JsS ' . ■■ . : ■r > * V > •••*;* •. v*'.--:'•* F o l l o w i n g ybur/'phone"pally■^^ye';jgleaj Br©v^v'fenilosln^^v^ ' herewith cheque for. Stg.£5>ti00 as.requested. ! • v? >'f‘-■ ''■ .• •'.. -.‘-. •* ■' ■■' •"■%• ■ '', - -''• •- ••' ..*■•■••■ /*» v •'-•■--^r. , v . ' > * ' ; >,V - ' •■• 'V *• m•-*■':- vl--'' v •: *Mfjk I ;h a v e . •: . n o te d ‘ - M i k e :s : •-• H o p s '’ t h i n g 3 :. a r e K in d e s t a d d r e s s • 5.: , g o in g v y r . * : - . '• ' V;>*r- y ; v , . ;* •-■;•;• /; ;;r~ . v w e l l .'. re g a rd s, . ;,‘V v ' ^ ■ yY o u rs - • .-• - ' ..r'-:"! ■*.... ' P' s in c e r e ly ,' V. •' • ;^ v ^ . -x; 4 ;:, • •••'• ;i S ; J.D. Traynor1 . ,:v/ ■, . . ■ ■■. . ■ r\t< ■- v-'7r; ' '■ v ' ,::? .- v f : v-' f * ’ .vS*£ ‘ *T*’‘ •' •■'.‘V* • -•. /* y‘ * •' “ ;. v < " . ■ '■ z - ■$%■■'■ ■"■■>■■. ■ • .V.^ ■' •-...':■ ... ■■”' ■■- -i' ’ : .r;aSiiSB ■:\T; MORA SHAKAHAN Nora called to see ae as arranged cm Friday 24th.August whan we discussed ay letter to her of the 19th July. Sha laft the draft for £25,000 with aa and I undertook to lodge to Ansbacher Limited A/A Account. . Sha will be opening a new Currant Account in London. I will poist to har on Tuesday 28th August a draft - ax the A/A Account - for 8tg.£Sr000. which'sha'will'lodga to that Accopnt. : ■ _ • I . •: ' • • . : • ■• • Sha laft with, aa an envelope containing instructions ra A/A funds in event of har! death.'' ' . . 27/08/90 JDT/AJW Appendix XV (119) Mr Michael J Shanley 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Michael J Shanley. a) Extract from Guinness and Mahon credit committee minute o f 13 January. b) Guinness and Mahon authorisation form to open deposit account o f 13 January 1978. c) Guinness and Mahon file note dated 13 January 1978 accepting funds for account o f Keeladrum Investments Limited. d) Guinness and Mahon file note dated 13 January 1978 accepting funds for account o f Keeladrum Investments Limited. e) Letter o f 27 July 1978 - John Furze o f GMCT to Guinness and Mahon. f) Guinness and Mahon memo o f 3 July 1979 - Mr Chris Waite to Loans Services Department. g) Maureen O’Brien Trust Deed dated 23 April 1970. h) Letter o f wishes o f 23 April 1970. i) Katharina Trust Deed dated 12 November 1977 and change o f trustees and deeds o f appointment. j) Letter o f 21/22 January 1987 - Mr TK Smith to Mr Michael Shanley. k) Letter o f 18 February 1986 - Mr TK Smith to Mr Michael Shanley. 1) Letter o f dated 21 January 1987 - Mr TK Smith to Mr Ellis. m) Letter o f 5 February 1987 - Mr Michael Shanley to Smith Foy and Partners Solicitors. n) Letter o f 3 February 1986 - Mr TK Smith to Mr Michael Shanley. o) Letter o f 22 Novem ber 1982 - Mr TK Smith to Mr Sean Mooney. p) Letter o f 6 December 1982 - Mr Sean Mooney to Mr TK Smith. q) Transcript o f evidence o f Mr Thomas Kevin Smith dated 27 September 2000 . Minutes of the 171st Meeting of the Banking/ Credit Committee M d erf 17 College Green, Dublin 2. on Friday 13th F^Wwrp^l97 J.D T. - M. E. 0 ‘K. - M. J. P. - GMcC.. - P. J. F. - P. O'D. - BMcL. I. W. K. - M . C . K. 674: . Moybqch lnve«tment« Company - (See Minute No. 611) A fact IIty of £19p,000 granted to the above mentioned on 26/10/77. It has now been recommended to let them have an extra £40,000 to bring their total facility to £170,000. Amount: £170,000 Purpose: Purchase of property Term: Bridging to 31/I0/7B Rate: 2% over base Security: "SUITABLY SECURED". Solicitors undertaking to hold Title Deeds of Property tn Leeson Street to our order. . . .t"\ t> . A u th o ris a tio n ,!o a ywca va cKcx.'^-W- to open D e p o s it A ccount DISTRIBUTIONOF COWES WHfTE:CUrrietlUcrkt*. YELLOW:U^kinfUamjtr. PINKICt*. BLUB:CtntnlHttnf Authorlwd DataOpanad: AccountOpanadBy: m c K !fifth s ! u to AccountNama . — /£ M m A/CContact c /c CHECKLIST Oau Sontrol Oarfcal M . C X n- SIGNING POWERS /■ v IndividualA/CSonatinaCard Joim/FirmJCompanyA/CMandateFarm. fStrlktmarwMrtmraorwMmMN . SENTOUT RECEIVED I' ^AUTHORISEDTO SUPPLY INFORMATION(tf*fflmt,ttrt mar* with ••X"I □ FORWARD INFORMATION TO3...... .. ~ j ^ / S •3 » 3 J ^ ® 7 ' £ l& V O O *—% tr AMOUNT OF DEPOSIT ► CALL/NOTICE DEPOSIT * FIXEDTERM DEPOSIT RataX' “■ .— 1SSW OLL_______ 2DAYS.-----* RataX RataX 1 MONTH____ MATURITY OATS ' RataX j RataX „ RataX 'STANOING INSTRUCTIONSTO RELOOGE InvamRMfitCuitomariA/C //ippUttM* rickbax with «n "X n ’ StattAccount (fippttmU* ttek»cu>withu “X- n COMPUTERFILESET-UPFORMCOMPLETED BY TO BECOMPLETED BY PiaparadBy CLERICALSECTION KARDEX CARD FarmPIUMrftor FilingBy• ChaakadRv KM By OATS ! -1...7 8 warn •/ . »».•** RLE* 13th January, 1978. Kaeladrun Invsstaents Limited, o/o G*V«C»T« ACCEPTANCE: l! t Vatu* 12th January, 1978. Amount £160,000.00 Stg. PteaaaPay Guinness*Mahon Limited. for Account Yourselves Term Fixed to 12th January, 1979. Rat»%parannum 10 ArrangedThrough Direct. y u?mm@ ti 1 12th January, 1978. Valua . Amount .£18,332.27 Stg. 1 j' • ti i i i Guiimesa+lfalion Liaited PI—» Pay for Account ' Y o u r s a lv e s Twm Seven Days Notice i Ratettpar annum 8} ;• Arranged Through Direct. ! i r- \ i i j i f i o % I GUINNESS MAHON CAYMAN TRUST LIMITED AMambar ef tha Outnnaaa MahonMarchant Banking Group IhlephoaaNo 9-4*8V4 Tale* Rft»0«8»7 CP 308 - Cable Addraaa Outnnaaa Grand Cayman BrtMah Weat Indies your ref ^ ourr*4 JAF:jat JtOy 27, 1978 Harbin Keane, Esq., Guinness £ Mahon Ltd., 17 College Green, Dublin 2, IRELAND. Sear Martin, KEBLAPWJM INVESTMENTS LIMITED In your telex of 30th June you indicated you would be sending me a copy of the statement of the seven day notice account maintained by you in the name of the above company. To date it does not appear to have been re­ ceived, and perhaps you would make a note to let me have a copy, and also forward copies at regular intervals . In order to discharge our fees and disbursements, could you arrange to transfer say £1,000 to the Sundry Sub-Company account under advice? Best wishes, / Tours sincerely, JOHN A. FURZE 1S 75 M -rsst. E K O R U D To: . Loans Services Department, Guinness Uahon ft Company From: Chris Waite, ■ Guinness + Iflahdn Limited. g l l 3rd July, 1979. JL 7 Re: O Maybach Investment Co.Ltd. Interest has recently been paid on the above Loan Account which presently has a balance £160,000.00 debit. The funding deposit is with Guinness Mahon Cayman Trust and we understand that Interest aecruels on the backing funds will have been credited on the application dates. We shall he grateful if any ov8r an<* above £160,000.00 could be remitted to this office.\I? is in order for you to credit our account in your books bu/kvit would be helpful if you- would mark credits for “the attentionN?f Mr. -Chris Waite. CAW/SM H i ' [ S X u S J ^ T T h U U S K T dny o ; l a undo' th o j ------------------------------------------------------ -n im hun dred and o a v o n ty ■ . ■ HAPIi'-’KH O 'D R IK f of B a rm o fc 5 ! S troot.D ru m ah on b o C o u n ty L o l t r l m .J l n r r i o d nomaa ( h a r o i n a f t o r o a l l a d " t b o S e t t l o r " ) o f th o aao p a r t and K.C.TfflXThr.vln g i t * , ro /c lo te ro d o f f l o o n t 6 9 / 7 1 S t .a t c p h o n * n b ro o d E u b lln Cr/irV.rV OT T IC BA Pr OP IWRLABPrh o r a l n a f t a g o a l l o d " th o D ank*) { h n r o lro f t o r J o i n t l y a n i l e d " t h e T r u o te e a “ ) o f t h e o t h o J rr 1) B H S A 3 (n ) ■ • n o S e t t l o r I n d o a ir o u a o f e s t a b l i s h i n g a S e t t le m e n t on ; tru o t. ( h e r e in a ft e r o a llo d "th o T r u o t " Jin B anner h e r e in a f t e r a p p e a r in g * (b ) ' ./ '* • *• • I . . 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' _ X t s h a l l bo l a w f u l f o r th e I r u o t o e s o t a n y t in e o r t i n e s b e f o r e t h e Y e p t l n g D ay e t t h e i r a b s o l u t e d i e o r e t i o n t o f a y o r o p p ly a n y p o r t o r p a r t s o f t h e o o p l t a l o r lnoom e o f t h o T r u a t Fund t o o r f o r t h o b o n o f l t o f a l l o r a n y o n e o r m ore t o t b s e x o l c e l o n o f t h o o t h e r o r o t h o r a o f t h e A p p o ln to d C l o s e f r e o d a n d r e l e a o o d f r o n t h o t r u s t s o o D o o m in g t b s n a n s PROVIDED ALWAYS t h a t ; . d u r in g t h e l l f o j o f tb e S o t t l o r a n y e x o r o ls e b y t b s V ra a to e e t ilt h ouoh o o n o e n t oo a f o r o e a l d o f t h e p o w e r i n t h i s o l a u s e o o n fe a in e d s h a l l bo e u b j o o t t o t h e l i m i t a t i o n t b a t t b e c a p i t a l o f t b e T r u a t . , Fun d* r e a a l n l n a s u b j o o t t o .t h e t r u s t s o f t b l s S e t t l o a e a t ic a a o d iito - . ‘ ' I l y s f t o r euob e x e r o l s s s b a l l b o o f a v a l u e o f n o t l e e s t h a n o n e bun p r o r r ia t lo u i n o r tO'Misdo o o t i o f n a t l o n o f any in to ro c t; o r olinro o f an y poroon in to rc u ttfd t h o y o io no *.»,- n— (b ) To r e e c i v e a d d i t i o n a l . p r o p o r t y b y g i f t o r W ill o r b y th o p r o v is io n o f a n y o t h e r T ru n t o r T ru o tn o r o t b o r o is o f r o a a n y per.non os? p a r o o n a no o W i t l o n i t<> t h $ o T n t n t a n d t o b o l d t h o o a a o upon t h o t r u o t n h o r o i n n o t f o r t h a n d t o n d a l n i s t o r o d d itlo n a u n d o r tb o p ro v i o Io n s h o r o o fs • • . • , ouob »’ ( o ) f f l t h r o o p o c t t o a n y p r o p e r t y o o n e t i t u t i n s t h e w h o le o r p a r t „ . o f t h e T r u s t Fund t o e x e r o l o s a l l p o w o r s w b io b a n y I n d i v i d u a l) ) “ ' I : . . b o n o f l o l a l o w n e r ,t h e r o o f B l s h t a x o r o l a o i n r o l a t i o n t h o r o t o I f . . •. , w it h o u t b e i n g I l a b l o . o r r o a t r l o t e d l a a n y w ay b y t h o o f f l o o " . o f T r u o t o a ln o l u d l n f f ( w i t h o u t • o f t h e f o r e g o i n g powa(r ) — . {1) • " p r e ju d lo o t o tb o g e n e r a l i t y ‘ • P ow or t o t n t v - c j o n o r l a r e a p e o t o f a n y a b a x a a e e o u r l t i a bonda n o t e s o r o t h e r e v it o o e o f l n t o r e a t i n o r o b l i g a - • • ^ • . . . . . . t lo n a o f a n y C o r p o r a t io n T r u s t A o a o o lo t lo n o r C o n o ern ’ w h e th e r o r n o t a f f e o t i n g t b a e e o u r lt y o r th e a p p a re n t o o o u r l t y o f t b o T r u s t jfund o r t e a p u r o b a a o o r a a l o . lo o s e o f t b a n u a o to o f an y auoh C o r p o r a t io n T r u s t . ’. \ or . ' . A s o o o l a t l o n o r C one a r m •• • ( H ) P o s e r t o d e p o s i t a n y o u c h a b a r s a o o u r l t i e o o r p r o p e r t i e s ! ,• a n y v o t i n g t r u s t o t w it h a n y d e p o s i t o r y d e s i g n a t e d -to ‘ th o ro to y i ' ' . : •' ( i i i ) P o n o r t o g i v e p r o a d o a o r p o w e ra o f a t t o m o y w i t h o r w it h o u t p o w e r o f a u b a t i t u t i o n f o r v o t i n g o r o o t i n s on * (d ) b o h a l f o f t h a T r u o t c o o a a t h e ' o w n e rs o f o n y ouoh p r o p e r t j s S o b o ld a n y o r a l l o o o u r i t l o o o r otbox* p r o p e r t y i n b a n r e r ' f o t n i n th o n a s o a o f t h e T r u a t o o o o r i n t h e n a s o o o f a o c a o t h e r p o r o o n o r p a r t n o r a b l p o r i n t h o n a c o o f a d u l y a p p o in t e d ' h o o ln o o w it h o u t d i s c l o s i n g t t a ' Y i d u o l a r y r o l a t l o n a h i p . ( e ) To k e e p t h e wholQ o r a n y p a r t o f th o T r u o t fu n d w i t h i n o r w it h o u t t h o S t a t o . •• • • i ■ 1 « { £ } To I n a t l l u t o p r o n e o u t a an d d o fo n u a n y c u i t o o x a o t S o n o o r o t h e r p r o o o o d in g o n f f o a t l n g t h o ? ru n to o n o f th o T i'u a t ? » n(j ’ to co m p ro n ln o a n y m n t t o r o f d l f f o r o n o e o r t o a u t c .it an y cuch n a t t o r to a r b i t r a t i o n t o o o iap roiaioo o r oo ap o u w i ony d o i t a . «■ - ...... .________________________ » « . » .*1 »*/•* an ouch T ru o to e o upon o v id e n e e t h a t th o T r u a t e a n s h a l l deem s u f f i c i e n t end ui.-on s u c h to rm o an d f o r ouch t o ram o o t h o T r u n t c c s d ? c n o d v l s a b l o t o onlco p a r t i t i o n w it h co -o v ?n o ra o r j o i n t t r n o v o t it t b t h e S w o tc c H i h a v l c s o n j 'i n t e r a c t i n a n y ! ■ p r o p e r t i e d i n w h ich t h o T r u a t o o a o r a i n t o r e a t o d o d d t o vako . o r o th c r.» io o » auoti p a r t i t i o n e i t h e r b y s a l e o r h y s o t - o f f o r b y Q fiT o eo aat * • I " ‘ • ( g ) To in v o o t ro -p in v a o t a n d m anage a o e u a u l a t i a n a o f in & o n o b i t h e ? so p o xn t& y o r to g o t h o r . w it h o t h o r fu n d s < ' • ’ ‘ • ( b ) To to k o th o o p in io n o f S e n i o r {7c;~ n s e l p r a c t i s i n g i n t h a . • I I .C h a n c c ry a i d s o f jt h e H ig h C o u r t o o n c e r j m s a n y d i f f o r a n e a ‘ . a r i s i n g u n d e r t b i ? S e t t le m e n t o r o a a n y n a t t e r t o a n y w ay . I . . - *• r e l a t i n g t o t h e T r u s t Fund o r t o t h o i r d u t i e s i n o o n n e o t io n w it h th o T r u s t a n d i n a l l euob* n a t t e r s t o a o t i n a o c o r d a n o e f . w it b t h e o p in io n ^ o f fluob O o u n o e lt (i) • ’* •' So d o lo g o t e t o a n y p e r s o n o r p o is o n s C i n o l u d i n y o C o r p o r a t ­ io n ) th o q x s o u t i o B o r e x o r c i s e o f a i l o r a n y t r u s t s p o w o re • nnd d i o a r q t i o n a ,v e s t e d i n t h e T r u s t o o o i n r o l o t i o n t o . t b e nonngcttont o r a d m i n is t r a t i o n * o f a n y ‘ p r o p e r t y movatolo o r im o o v a b lo t . • * / • t •. ( 3 ) To e x o r o is o a n y p o w e r’ o r d i s c r e t i o n v e n t e d i n tb o T r u s t o oo n o t w it h s t a n d in g t h a t ono o f t h o T r u s t e e s may h e p e r s o n a l l y . • in t e r o o t o d i n th o e x o r c io o t h o r o o f oo l o n g no tb o o t h e r .. T ru o te o o o h o l l ho ia d o p e n d o n t o f a n y su c h i n t o r e s t . ( k ) Tq l o a n n o n ic o fo r m in g p a r t o f tb o T r u a t Fund t o a n y ­ - . .. i n d i v i d u a l who t h e r a b o n a f i a i a r y h o r e u n d a r o r c o t o r t o a n y f i r m o r com pany qnd w h o th o r w it h o r w it h o u t o 6o u r i t y and on . suoh to rm a a o t o i n t o r o o t an d re p a y m e n t o f th o o o n io d do t h e T r u o ta o o o h o ll th in k f i t ! • • ’ ( 1 ) To borrow on th o o o o u r i t y olf a n y p a r t o f th o T r u a t Fund a c y I B o n io o to b s a p p l i e d f o r a n y p u r p o s e cdn^ioton'C ^vjiTh th e i a b jo o t a o f th o T r u a t . ^ 2C. > ••• Any r.nd o v a r y T ru o to o h o r o o f v»ho c o y bo a S o l i c i t o r o r J onfTigoa I n nny p r o io o n io n o r b u a in o a a o U o ll bo o n t i t l o d ana i 0 h o ro b y o u th o x io o d t o r o t a i n a n d r a o o iv o out o f tfio Ti-unt Tuni h ia ' nrtnrtT r>nntn 0&d q b flr5otJ ^ O ll flfl by V7.3y o g jj r o ta u n e r n tlo n f o r h n n lm o n tr n n n n o tn d b y h i n o r h i o p a r t n e r o r j i h r t n c r o p o r o o n a l l y o r b y I r io o r t l i o l r o l o r k a a n d n g o n to ( I n c l u d i n g o i l b u e ib a c a o f w h n t o v s r i;in d n o t o t r i o t l y p r o fo s o lo n - m vo b e e n j o r f o r n o d i n p e r s o n b y a T r u o t e o o l b u t vtliloh n o t b c l n s o o o l i o i t o r o r o t h e r p o r o o n do a f o r e o o i d ) a s o o c t o a n d ( • o b a rG « o o u t - o f - p o c k e t a n i f o v o x y - s u o h p o r o o n oo a f o r a o a l d h o d t n o t b o o n a T r u o t o e h e r e o f ■b u t • hod b o o n -e m p lo y e d i n t h o ' n a t t o r o f th o T ru o t. X I* . •‘ . * • * . - • - • Any T r u o to o may o o t a s a n o f f i o o r o r e m p l o y e e 'o f a n y C o s p a n y th o e h o ro o o r d o b e h t u r o a o f w h lo b fo r m p o r t o f t h o I r u o t F u n d o r o s on o f f i o o r o r e a p l o y e o o f a n y s u b s i d i a r y o r a s s o c i a t e d o o a p o n y o f on y su o h com pany ond majr r o t a i n f o r h i n own a b s o l u t e u o o a n d b e n o f i t a n y r o a u n o r a t i o n u b io b h o n b y r o o e i v o a s su o h o f f i o o r o r o a js lo y a o n o t n i t h o t a n d i n a t h a t a n y v o t o a o r o t h e r r i f i h t e a t t a o h o d t o a n y ouch o h o r o o o r d o b o n t u r o a ' n a y h a v e boon I n s t r u o o n t a l e i t h e r a lo n e o r In . o o n ju n o tb n w i t h ' o t h e r g u t t e r s o t ■ by re n so n o f t h e i r n o n - o x o r o io o I n p r o c u r i n g o r o o n t l n u l n c f o r h im h i o p o a l t l o t s o ouoh o f f i o o r . o r o m p lq y o e o r t h a t h i o q u a l i f i c a t i o n f o r a n y ouoh p o s i t i o n n a y b o r b o n o t i t u t e d i ' a ' p e i f t 'o r i n vifc'ola b y t b s h o l d I n s o f ony sb o re o o r d e b e n t u r e s .' X II* " • ’ Any o o r p o r o t i o n b e i n s a T r u o t o o " i n th o d lo c h n r g e o f i t a d u t i o o no ouoh T r u o t e o o o a f o r o s a i d a n d i n th o e x o r o l o o o f a l l d i o q r e t lo n o iy . an d o t h e r povraro h e r o u n d o r n a y o o t b y . i t s p r o p e r o f f i o o r o f o f f i o o r o a p p o in t e d I n t h a t b o b a l f and c a y e m p lo y a n d p o y a t t h e oxj-o n ae o f t l o in com e o r o a p l t a l o f t h e T r u s t ?u n d n n jl a c o n t i n o n y p a r t o f t h a 'w o r l d w h e th o r a S o l i c i t o r A c c o u n ta n t B r o k e r o r o t b o r A g a n t an d n h o t h o r o r n o t b e i n g one o f t h e T r u s t e o o t o t r n n n a o t a n y b u a in o o s r o q u ir o d t o b o dono i n t h e p r o n i s o s ' ( i n c l u d i n g t h a r e e o i p t o n d p o y s e n t o f money end th o e x e c u t i o n o f d o o u n e n to ) and may w it h o u t b o in g l i a b l e t o o c o o u n t f o r a n y p r e f i t w ide t h e r e b y r o t n l f t o o D an koro on c u r r a n t ' o r u o p o o it ' a c c o u n t ' o r ‘ od vn n ce a l l moncyo n o o o o o n ry o r o o n v o n io n t t o bo r e t a i n e d ' o r a d v a n c e d i n eonn-’ o t l o a w i t h t h e ’t r u o t p r e a in o n ond s h e l l be Q n t i t l e d t o bo !; an d o o o jiie o lo n ®*»o i t ’ . a n d p a id o u o h .o h o r c o o orcponcoo i n t o r o o t ch o rees i t „ oun tom oro i a th o o r d i n a r y o o u rc o j! 1 3 6 .an y ftllo H rtn e o o f o o n n io o io n o r / j r o k o r o s o nnd o h a l l . n l s o o n t i t l o a t o r o E u n o r o t lo n t o r H a o o r v l o c a o n I r u s t c o o f t b e o o I n a c c o r J a n o o w i t h the^ n c a lo o f f a o o a £ r o o d b o tw o e n t b o p rc o c n to P r t t l o r an d t b s C o r p o r a t i o n * X III. ■ t h o U ru o to o a o b a l l n o t bo bound o r x c ^ u lr o d t o l a q u l r o ' I « ‘ In to o r i n t e r f e r e w it h th o n o n o g o w n t o r co n d u ct o f a n y C ocn acy an y e b n ro a o r o t h e r o o c u r i t l o o o f n h io h s h a l l f o r t h e t i t i a bo I n c bo o o a p r io e d i n t b o T r u o t Fun d o r o f t h o b u s in o o a t b o r o o f w h o th e r ' o r n o t t h o w h o lo o r a u j j o r i t y o f t b o e b o r e o o f ouoh C o sp o n y o r a c o n t r o llin g I n t o r o a t t b d r o in o b a l l bo v e s t o d i n th a T ru o to o s b u t th o T r u s t e e s e b o l l b o a n t I t l e d t o l o a v a . t h e o o n d u o t cC a n y s u e b oom pary ( i n o l u d l n s t b o p a y c e n t o r n o n - p a y a o n t o f d i v i d a n d s ) a n d th o b u a in o a o t b o r o o f w h o l l y to* t b e D i r e c t o r s o f . irach S o x p o n y a n d ' • I * * • b o n o fio ia x y s h a l l b o ro th o r i g h t t o r o q u i r o t h o p o y tn n t o r d i s ­ t r i b u t i o n o f a n y d i v i d e n d b y a n y uuol>6 ouipony o r t b o e x e r o i c o byth o T r u a to o o o f a n y p o w e r . t h e y m ay h a v a o f o o n p o l l l n g a n y ouoh paycan t o r d is t r ib u t io n o r t o o o a p o l o o n tr o l o r fo r b id tb e ■ e x o r o i e e o r tb o a x o r o i s o l a a n y p a r t i c u l a r B a n n e r o f a n y v o t i n g r l ^ i t n w h ic h a n y ..bo a t a n y t l a o .v o e f s d i n th o ..T ru t> to o o . • X IV . 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Tho T r u s t e e s a h u l l h o v o p o n o r t o la o o r p o r a t o a n y o o s p a n y o r r o o m p a a ie a i n a n y p la o o i n t b e n o r l d u t t h o c x p o n o o o f t b o T r u s t Fund n l t h l i m i t od o r a n l i m i t o d l i a b i l i t y f o r tb o p u r p o s o o f ( i n t o a l i a ) a o q u l r i r v i t b a w h o lo o r a n y p o r t o f th o t r u o t Fund an d t h a ' c o n s i d e r a t i o n f o r th o a a l o o f th o t r u o t Fund o r a n y p a r t t h o r o o S t o ntqr oompony in o o r p o r a t o d p u r a u a n t t o t h i o o lo u n o n a y e o n s ii s t ' % w h o lly o r p a r t l y o f f u l l y p a i d d o b o n tu r o a D o b o n tu ro Stoo'K o r E h a ro a o r o t h n r o o o u r i t y o f t h o Company t ib ia h n ay b o o r o d it o d a s f u l l y p a id and vihiish c o y bo a l l o t t o d t o o r o t h e r w i s e v o o t e fl its thqj K V w ito o o an d s h a l l bo o o p i t a l aon oyri i n t h e T ru a to o o * b a n d s . jiiu V r u a to o a 1197 a t utvy t l n o o r t l n o o o n t c r i n t o a n y ' S o o tap ro rln o o r n r tfh n c o o o n t w it h r o o p o o t t o o r t n y r o l e a c o o r f o r b o o r t o e n o r o io e a l l o r a n y o f t h o i r r l c h t o o a d o b e n t u r o h o ld o r ♦ ’ M d e b e n t u r e o t o o k h o l d e r s o r o d l t o r a S t o o ld io ld o r o o r o h a r e h o l d o r a o f n n y o o s r a n y a n ^ ts h o th o r i n o o n n o o t lo n w it h a o o h o o o o f r e c o n s t r u c t i o n o r n m o li p n a t i o n o r o t h o r w i s o an d may n c c o p t l a o r to w n rd o o a t i a f a o t l o n o t a l l o r n riy a u o h r i g h t o ouoh c o n s i d e r a t i o n ! a a t h o y o h a l l I n t h e i r o b o o lu t o a n d u n c o n t r o l l e d d i s c r e t i o n t h i n k . f i t n h o th o r I n t h o fo r m o f o ao h o r o to o lc a o h a r o o d e b o n t u r o a d o b o n tu ro a t o o k o r o b l l g n t l o n o a r s o a u r l t i e o . o f t h e s a n o o r a n y o t h o r oom jon y o r c o n p tm io o w i t h o u t b o l n g i n a n y w a y l i a b l o or ' r o o p b n a i b le f o r a n y l o o s r o o u l t l n g fr o m a n y au o h o o a p r o o io o '’ ' a r r o n c o B e n t r o la o n e o r fo r b e a r a n c e o r i n r a a p e o t o f a n y - • in a d e q u a o y o r a l l e g e d I n a d e q u a c y l a t h a u a t u x a o r amoaufc o f a u o h c o m id o ra tio n . X V II. .■ . ' •-* .• Tho I r u e t e e a o h a l l ba o t l i b e r t y t o a x a r o l a o a n y p o n o r o a p p o ln t n o n t e l v o n t o t h e * b y t b l o S o t t lo m o n t a n d t o e x e c u t o t h e ' B t r u o t o o f t h l a S e t t le m e n t f o r t h a b e n e f i t o f a B e n a f l o i a x y n o t - w i t h s t a n d i n g t h a t a u o h B o n o f l o l a z y lar o n e o f t h a S r u a t o a o KSOYIDED t h a t ( i n en ch c o n e ) t h o T r u o t o e a l t n l n d e o t l a a a t o n * p o r a o n who l o n o t a B o n a f l o l o x y o r ln o l n d a o v a r y b f l n o f i o i a r y f o r t h a t i a a i « b e i n g l i w l n f f and n a o e r t a l g e d . X V IIS . - . • • . 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X X .---- I t lo h c r o b y o c r c c d a n d d a o ln r o d t h a t t h a S a n lt i o a p p o in te d T n r n tc # u y o n l t o p u b llr - h o d t o r a a - o n d o o n d l t i o n o i n c l u d i n g ponaxa r l r h t a and p v i v l l o c od i n t h o Su r.iacian n t o th e H andbook o f . f u l l y and o o a p lo t o l oo t f o r t h AJI1) I t lb o b a ll In o n t lt l a d ti o o a lo o f f o a o now l i agreed ZR u p o n l a w r ll Vimssa t ih a r o o f 1 ----------------- t b a a e pr< w ritte n . SICWTTP SSAtiBP ARP TO b y t b a a a l d Ho a w o n 1& pYOOOBOB oft . V PRTPSTtT w han t h a C aaX o f IC .G .T ru o t « a a h a r a u n t o ftfflx a d i V B arrack S tre e t, D ru m sh a n b o , CO. LEITRIM. K. C. T ru st, 69 /71 S t. ' . S te p h e n ’ s G reen , DUBLIN 2. 23 A p r il 1970. D ear S i r , . 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In ■ th e a p e rso n p erso n th e is of th e Issu e m eans n am e d o r d e s c r i b e d in s h a ll P o rt, ir r e v o c a b le G u ern sey S e ttle m e n t th e m ean a n y fo llo w s .— a ll or u n in c o r p o r a t e ) re c o g n is e d as c h a r ita b le by s h a ll th ro u g h and in c lu d e s tru st, a c h ild a ll s c h e d u le p erso n s d e te r m in in g an o f h is a d o p te d o r a d o p tiv e a ll th e c h ild r e n o f th e p erso n s com pan y o r o t h e r b o d y e x c lu s iv e ly o f th e Is la n d fo r p u rp o ses o f Je rs e y ap p ear in so m ean a n y i n d i v i d u a l w h o h a s it s h a ll th e age ap p ear s h a ll a c c o r d a n c e w ith fu ll th e e x p r e s s io n age, and t h is o f tw e n ty -o n e n o tw ith s ta n d in g m ay b y a n d i n and c o n stru e d a c c o r d in g ly : “ M in o r " w h e r e v e r t h e w o r d s h a l l as and d egrees; and an y fo u n d a tio n , th e la w s in c lu d e or h e re to ; e s ta b lis h e d " c h a r t t a b i c ** s h a l l b e th e In m ay b e a n d o f n o o t h e r p e r s o n p erso n th ir d and any o f B e n e flc i.a r ie s as any p e rs o n (c o rp o ra te fo llo w in g w o rd s h ave s c h e d u le h e r e t o . tre a te d case o f c f su ch “ E x c lu d e d P e r s o n s " fa r Man ' one o f th e s h a ll be p a re n t-a s to P e te r c o n t e x t p e r m i t s ’t h e and in c lu d e s a tta in e d . Is le . W I T N E S S E T H and re m o te r is s u e (d ) D o u g la s , o f m a k in g s u c h secon d th » w o rd _ o f th e o th e r p a r t . " T h e B e n e f i c i a r i e s ’* m e a n s "C h a rity " of * A venue, S t . n am e d o r d e s c r i b e d re fe re n c e s . J u l i a n 's d e s ir o u s m e a n in g s :- le g it im a t iv e . S t. S e ttle m e n t w h e re v e r th e le g it im a t e d (c ) 3 A th o l S t r e e t , T ru ste e s") w h e th e r o r n o t (b ) rv- S« c o n ta in e d : T H I S In C o u rt, d ie S e t t l o r h e re in a fte r day Mt U e S e t t l o r f y - . o f t h e ’ .o n e p a r t AND SO V E R E IG N T R U S T E E S L IM IT E D o f S t . ^ - u i i a n ’ s W H E R E A S !_ d ‘ -N -*,L E N G S T E N -',L IM IT E D o f (h e r e in a fte r c a lle d T u ^ u > ~ F ' rt m ad e t h e th e "fu ll la w o f h i s age" S e t t le m e n t t h a t su ch an d o n ly n o t- in d iv id u a l o r h e r d o m ic ile 1 b e s h a ll be of co n stru e d a c c o r d in g ly ; (e ) "P e rso n " in c lu d e s any in d iv id u a l o r any body o f p erso n s co rp o ra te o r u n in c o r p o r a t e ; (f) “ The T r u s t e e s " s h a ll m e an t h e T ru ste e o r T ru stee s fo r th e t im e b e in o h e r e o f ; (g) “Trust Fund" means:(i) th e and su m o f m o n e y m e n t i o n e d i n - ' th e fir s t S c h e d u le h e re to ; . and a c c e p te d by th o T r u s t e e s as a d d itio n s in v e s tm e n ts and p io p o r t y fr o m to th e T ru st Fund; and ( iii) th e sach m oney, .j 1'1J • ■a • th t " w liid m v o r (1 ) • o f t in -- f o llo w in g days a fte r ( ii.) su ch th e e x e c u t io n day (if any) p e rio d s h a ll th is d a y o n w h i c h i . s h a l l ’ ( iii) th e day d ie la s t a t th e been (i) e x p ir e o f t h is as (i) ( j) w o rd s in gen d er. (k ) w o rd s . in th e th e Is la n d th e o f each th e a a id tio n h ereo f sa v e t h is c la u s e d e c la r e by a c c o rd in g m oan t h e been In stru m e n t la w p ro p e rty tin e of rig h ts i s l a n d w h ic h s h a ll h ave in w r it in g G u ern sey o r S e ttle m e n t s h a ll c a p a b le o f som e o t h e r v < o u ld l.u: c a p a b l e th e n c e fo rth be la w d e c la r e d e x e rc is e d o f b e in g t .lit C o u r t s liv in g m ay n o t h a v e h e re b f; l e g a l , e q u ita b le in c lu d e th e or fe m in in e ■. an d w o rd s a c c o rd a n c e w ith a ll p a r tie s in be fo ru m th e th e i fo r t h e ir th e T r u s t e e s or in th e n c e fo rth e x e r c is e e ffe c t o f w h ic h any o f th e an d c o n t a i n e d w o u ld and s o t a k in g e ffe c t and th e o f th a t sta tu or fo ru m or s h a ll m ay h a v e a cco rd an ce th e w o r ld e n fo r c e a b le t h is and th e . P o w e rs or S e ttle m e n t of. a d m i n i s t r a t i o n t e r r ito r y p o w e rs T ru st T ru sts, not be (il) as th e in of to o f th e any p a r t o f to a p p lic a b le e x p r e s s io n in (i) th e p r o v is io n s t e r r ito r y ta h e to a d m in is tr a ­ m ay b e o r te r r ito r y rev o k ed ) th e tim e e x e c u t e d w i t h i n of a c c o rd in g d is c r e t io n D eed w h ic h e v e r (w h ic h la w s c o n s tr u c tio n s u b je c t o n ly fo re g o in g o th e r s ta tu th e and th e and r e g u la t e d S e ttle m e n t lim e t o sta te a p i act- u n d e r t h e o f b e in g p e rso n s of a fo r e s a id . th e pow er a t o f su ch t o tim e d e c la r e d b y h e re in d e a th th e e x e c u tio n th e p lu r a l of o r by th is and P r o v is io n s as t h a t n o t w it h s t a n d in g p i- n o d (n o t b e in g a fte r R eal o r P e rso n a l P ro p e rty s h a ll be th e c l a u s e ) fr o m th e la w in B e n e fic ia r y p r o v is io n h e r e o f s h a ll th is w ith d is c r e tio n s p e c ifie d b e in g o r in t e r e s t and c o n s t r u e d c o n fe rr c * d b y th a t day th e gender s h a ll t h e P r o p e r L aw o f t h i s of th e ir . and th e th e T ru s te e s to fr o m o n ly years th e s in g u la r . and e v e r y ju r is d ic tio n la w s o f any e s t a b lis h e d , u n d er an d in o f G u ern sey and e f f e c t e x c lu s iv e th e • in c lu d e is to tim e o f s in g u la r s h a l l in c lu d e p lu r a l s h a ll T h is S e t t le m e n t th o rig h ts i m p o r t i n g .t h e m a s c u l i n e ^ o f e ig h ty m ay a t th o u g h s u c h m ean a n d i n c l u d e o r o v e r su ch n a n t -1 y : - o f tw e n ty -o n e y e a r s at an d any h e re o f u n t il s u b - c la u s e ; d a te h e r e o f even a B e n e fic ia r y d a te th e re o f. S e ttle m e n t; s u r v iv o r o f th e B e n e f i c i a r i e s w h e re so e ve r s it u a t e o th e r w is e o f t h is re p r e s e n tin g Any p a r t s firs t: th e p e rio d th e T r u s te e s o f e x p ir a tio n "P ro p e rty ” s h a ll L im e fr o m , t h e o c c u r a p p o in t b y d e e d e x e c u t e d p r i o r p arag rap h to i n v e s . U rfcim s a n d a d d i t i o n s ; o r '" it i i; T rt*! 5 t - r * « r ir > d '‘ s h a l l m - a n ■(h) t im e la w s h a ll o f th a t n sta te :J or t e r r it o r y nd fu rth e r m o re s h a ll th e n c e fo rth th e T r u s t e e s a lt e r a t io n s o r a d d it io n s P 6w e r s and P r o v is io n s e ffe c tiv e a s th e y s h a ll to t h i s u n d ftr t h e - ------------- h a v e p o w e r t o m ake s u c h c o n s e q u e n tia l S e ttle m e n t to e n su re t h a t h ereo f s h a ll a ie £>e a p p ii .c a u j.B ( m u t a t i s m u t a n d is ) la w be th e as T ru sts, v a lid o f G u e r n s e y w h ic h e x p r e s s i o n and h e re in shall, nxfiwi t h e " la w o f G u e r n s e y o r o f s u c h o t h e r o t a t e o r t e r r i t o r y a s may h a v e b e e n fr o m t im e U ie p c*rfers c o n f e r r e d b y t o t im e d e c la r f - d - b y th e T r u s t e e s th is • c la u s e . in e x e r c is e Trie T r u s t e e s s h a l l s t a n d p o s s e s s e d o f t h e T r u s t F u n d U pon T r u s t a s in v e s t m e n t s o r p r o p e r t y m oney i n e it h e r o th e r th an t o p e r m i t t h e sa m e t o re m a in i n t o m oney a l l o r a n y o f s u c h " w ith th e co n tro l lik e in th e l i k e d is c r e tio n any o f t h e d is c r e t io n t h e ir a s in v e s te d in v e s tm e n ts a b s o lu te o r to t h e ir s e ll or co n vert t o m oney nam es o r u n d e r t h e i r in v e s tm e n ts h e r e i n a f t e r a u t h o r is e d w ith fr o m t i m e in v e s t m e n t s f o r o t h e r s to t im e to v a ry o f a n a tu re h e re b y The T ru s te e s s h a l l s t a n d p o s s e s s e d in c o m e t h e r e f r o m d u r i n g of o r tran sp o se pow er a t an y su ch a u th o r is e d . th e T r u s t Fund «nd s h a l l th e T r u s t P e r io d in s u c h m ann er a n d i n a m o u n ts f o r t h e b e n e f i t o f a n y o n e o r a l l o f t h e B e n e f i c i a r i e s i.h a il in t h e ir a b s o lu te p r e ju d ic e to th e in co m e a s th e y s e e d is c r e tio n t h in k fo r e g o in g p r o v is io n fit to d is c r e tio n a n d Upon T r u s t a s t o i n v e s t t h e sam e i n of fit a p p ly th a su ch as th ey and th e T r u s t e e s w it h o u t s h a ll h ave pow er to a c c u m u la te s u c h f o r t h e m axim um p e r i o d p e r m i t t e d b y I s l a n d o f G u e r n s e y a n d a n y in c o m e a c c u m u l a t e d a s a fo r e s a id th e L ew O f t h e s h a ll fo r m p a r t o f th e c a p i t a l o f th e T r u s t and a t th e e x p ir a t io n o f t h e T r u s t P e r i o d UPON TRUST a s t o b o t h ' c a p i t a l a n d in c o m e o t t h e T r u s t F u n d f o r a l l o r s u c h o n e o r m o re e x c l u s i v e b e n e fic ia r ie s in g e n e r a lly in d is c r e tio n su ch s h a re s su c h m ann er a s d e te rm in e UPON TRUST i n e q u a l s h a r e s s h a ll ot th e n b e l i v i n g th em i n T ru ste e s d e f a u l t o f and s u b je c t a b s o lu te ly or e x is tin g : c o m b in a t io n s h a l l h a v e o n ly o f b e in g B e n e f i c i a r i e s to c o n tra r y n o tw it h s t a n d in g . a b s o lu te to su c h d e te r m in a tio n fo r su ch o f th e B e n e f ic ia r ie s any r i g h t o f any k in d a s any r u le In in p r o v is io n s t h e r e t o and t o th e P o w ers h e re b y e x e rc is e or by la w c la u s e as nor a ll a g a in s t th e li e i n r j a p p o i n t e d b y th e T r u s t e e s c o n fe rr e d th e fa ilu r e h e re in b e fo re or c o n t a in e d and t o and to any and th e and e v e r y th e e v e n t o f no a d d i t io n a l B e n e f i c i a r i e s in e x p ir a tio n T r u s t K und upon t h e e q u it y o r o th e rw is e o f th e se p re s e n ts c o n f e r r e d on th e T r u s t e e s o i su ch P o w ers an d i n p rio r to th is o f la w , th e e v e n t o f th e s u b je c t th e th e ir PROVIDED THAT n o B e n e f i c i a r y d e t e r m in a t io n o f th e T r u s t s h o ld in o r th e T r u s t Fuhd o r an y o t h e r p e rs o n o r b o d y o f p e r s o n s b y v irtu e th e m o re t h a n o n e a n d th e T r u s t e e s s h a l l th e n and in o f th e o f th e o th e r o r o th e rs and p r o p o r t io n s i f e x e rc is e of o f t h e i r P o w e rs h e r e in th e T r u s t P e r io d fo llo w in g T ru sts ' th e T ru stee s s h a ll . (a ) 1 v . %1. U u r ir ig th e T r u s t P e r io d d u r in g su ch p e rio d . s u c f i 'c h a r i t a b l e ’ *■ ' .o b je c t o r V . in d is c r e tio n (b ) A t th e and i f o f and 5. B lin d N o tw ith s ta n d in g th e T r u s t e e s a t any tin e in th e e v e n t o f. th e o r a p p ly su ch c h a r ita b le as w r itin g s h a ll o f th e th o s h a ll be s u ffic ie n t su ch N o t w it h s t a n d in g i f in th e th e ir th e g iv e T ru sts T ru ste e s a b s o lu te t im e d u r in g th e T r u s t P e ^ o d or ir r e v o c a b le P o w ers and p r o v is i o n s B e n e fic ia r ie s th e th e o th e r o r o th e rs and in su ch lim i t a t i o n s iri a n y or sh a re s at p eru o n or .ld v fin c v n ie iit o r p ro p er by Fund o r su ch th e o r .a n y age and p e rso n s or fo r s u b je c t and t h e ir o f th e Je rs e y Fund to Fund t o su ch to o r c h a r ita b le in th e c o n ta in e d T r u s t P e r io d m oneys p a id pay fo r o b je c t s e le c t m ann er as re c e ip t in and th e c h a r ita b le - t .o t h a t T ru stee s h e re in b e fo re o r t im e s la w d u r in g la w a c c u m u la tio n th is o f fo r any d e c la r e d and tim e and of new o r to fo r any su ch of w o r ld fo r ages te rm s or o f th e e x c lu s iv e o f tim e s and a p p o in tm e n t v e s t e d m a in t e n a n c e d u r in g r e v o c a b le o th e r T ru sts th e th e re o f o f th e m p o w e rs in c o m e by S e ttle m e n t r e s p e c tiv e s u b je c t p r o v is io n s fit T r u s t P e r io d D ee d s w h ic h e v e r m ay o r p a rts or th e any p a r t o f o n e o r m o re v.o s u c h su ch o f t h in k a p p o in t su c h any p a r t an d p r o p o r tio n s and w ith fo r D eed o r th e o f in d is c r e tio n any p a r t ic u la r o r by to b e n e fit o b je c t s un der t h is th e and th e w r it in g a c c o r d in g T ru st s h a ll d is c r e tio n f it so be th e or a b s o lu te T ru st a b s o lu te s h a ll In stru m e n ts and c o n c e r n in g o b je c t c a p ita l and th e th e y g o v ern ed b o th h ereu n d er. In stru m e n t o r a p p lic a b le in to d e c la r e d o r o th e r d is c h a r g e any d is c r e tio n o f o f th e o f and p r o v is io n s m ay a t and lik e d e te r m in a tio n th e ir th in k r e c e ip ts in s titu tio n one th e ir T ru ste e s and g e n e r a l l y d is c r e tio n in s titu tio n c o n t a in e d th e ir one to to in in c o m e in a u th o r is e d fo r . ■ te r m in a tio n s h a ll lik e in th a n UPON T R U S T f o r T re a s u re r o r p th e r o f fic e r a or o r in s tit u t io n s m o re th a n th e ir th e fa ilu r e c o n t a in e d in s tit u t io n paym ent p a id 6. in i f or c h a r ita b le o f any Pow er o r d is c r e t io n c a p ita l o r T ru stee s su ch p r o p o r t io n s T ru ste e s th e to to and Pow er e x e r c is a b le in s tit u t io n th e as an d P o w e rs h e r e in b e fo r e tim e s p r i o r any p a r t o f o r o b je c t s in have m o re s h a ll a c c r u in g a b s o lu te c h a r ita b le a b s o lu te ly . T ru sts o th e r th e ir i f s a jn e UPON T R U S T a s su ch sh ares e x e rc is e s h a ll or su ch th e th e th e Fund - T r u s t P e r io d h e re in b e fo re T ru st or in T ru stee s d e te rm in e ; C h ild r e n s h a ll * Fund f o r in th e a p p ly ' T ru st one or o f in s titu tio n s th e o f o th e r T ru s ts fo r . o f th e d is c r e t io n d e fa u lt c la u s e th a n or m ann er a s th e in c o m e s u c h .p r o p o r t io n s * su ch m o re a b s o lu te In and in e x p ir a tio n any th e ' T ru ste e s d e te rm in e ; an d in c o m e (c ) in a t it u t io n s e le c t g e n e r a lly to UPON T R U S T t o p a y o b je c t s ;,a s d is c r e tio n as m in o r ity e d u c a t io n or fo r th e •* .............. . ~ 'e v e n t o f d e s a s t r e , ' ,-v.f . a c c o rd in g to d is c r e tio n ■ th e in s o lv e n c y p ro p e r la w o f an y p erso n by t> a - ? iu s ta e s fit m ay t h i n k any su ch th e m as th e a c c o rd in g a ll any o f T ru sts to a p p o in tm e n t r e l a t e s T ru ste e s s h a ll and s o and. fo r and o t h e r w is e su ch la w in o f th e n c e fo rw a rd h o ld event th e T ru st of T ru sts m ann er a s th is g iv in g or th e any e ffe c t to D eed w h ic h e v e r c o n ta in e d re v o k e w it h w h ic h any su ch Fund o r or S e t t le m e n t th e re o f to o f th e B e n e fic ia r ie s h e re in o r p a rts th e su ch w r it in g and p r o v is io n s th a t in th e p u rp o se p ro p er at d is c r e t io n a r y o f su ch In s tru m e n t in th e p a r t a p p lic a b le and g e n e r a lly b e n e fit th e P o w ers to th e T r u s t Fund o r an d w it h th e sam e a s m ay b e S e t t le m e n t p erso n s fo r a p p lic a b le resp ect th is a fo r e s a id a p p o in t m e n t b y th e of su ch may b e or o r b a n k ru p tcy o r p erso n s and P o w ers e x e r p i s a b l e o n e o r m o re o f s u* «*»x xoi i u u c u u i c in uie su ch a p p o in tm e n t p art th e o r p a rts • .... t h e r e o f t o w h ic h ..... . P o w ers a n d p r o v i s i o n s so T ru sts P o w ers a n d p r o v i s i o n s h e re o f so to c o n ta in e d th e c o n ta in e d d u r in g ' ! ■■ - as to be sa m e hu o r sh e is I't-rm i i t e d b y to th e such to i any a p erso n say th e Pow er to o f B e n e fic ia r ie s o f p erso n s as to th e num ber o f th e in no c irc u m s ta n c e s a re . a u th o r is e d T r u s t Fund t o as • m ay i n h is or her g u a rd ia n so r e q u ir e d fo r p a id o f th e se e x e rc is e a p erso n th e re o f m ay b e in a th is so C la u s e an y E x c lu d e d P erso n p a y --o r a p p ly any be to in c o m e any p e rso n w ho i s a b s o lu te d is c r e tio n e it h e r th fe th e be su ch b e n e fit o f a b s o lu te th e in th e o f .t h is s h a ll c a p ita l or re c e ip t to of . or th e ir . and th e e x e rc is e c o n ta in e d s h a ll and any p e rs o n s c la s s e x c lu d e d b y th e N o tw ith s ta n d in g a n y th in g and e x e r c is a b le e x c lu d c th e t im e s w h ic h T ru ste e s d e c la r e d h ereo f in and T ru ste e s. h e re in fo llo w in g P o w ers p r e v io u s ly th e re fo r o r pay in c o m e o r th e by th e p r o p e r la w or v e s t e d .in th e and in th e P o w ers in c lu d e d m in e r w i t h o u t s e e i n g s»uch p a r e n t any o f th e any o f P ow er th e a p erso n p r e v io u s ly a m in o r an d t h e T ru ste e s la w or to d e c la r e d e x e r c is a b le th e T r u s t e e s t o h im o r h e r a ll c la s s a B e n e fic ia r y . o f th e a fo r e s a id fo r e g o in g and p r o v is io n s to or as fo r and p r o v is io n s h e r e in th e c la s s s u b s titu tio n s h a ll be in c lu d e th e T r u s t e e s a m in o r is and s u b je c t P o w ers S e ttlie m e n t, o r c a p ita l th a t fr o m t h e o r e x c lu d e d . p e rm itte d W h e re s h a ll h ave h e r e o f and t h e s e w it h o u t l i m i t a t i o n th is P o w e rs any p e rso n s to e x c lu d e in c lu d e d P o w ers in rev o k ed o r p erso n s T ru sts, o f p erso n s P o w ers o r t o o r in . th e l>ow ur t o i n c l u d e w ay a p p o in t e d S e ttle m e n t o r b y th e T r u s t e e s H e n e fic ia r ie s i t h is th e T r u s t P e r i o d , or c la s s ! an y p erso n N o t w it h s t a n d in g u p o n w i th a n y a p p o in t m e n t u n d e r t h e to d is c r e tio n s b y o th e r T ru sts and in may d e l e g a t e 7 .* a p p o in tm e n t r e l a t e s T ru sts p r io rity . su ch o f p ro p e rty any su ch S e t t le m e n t sam e to any a p p lJc a tio n s u ffic ie n t or n o t w ith s ta n d in g m in o r B e n e f i c i a r y s h a ll be a good p aren t o r d isc h a rg e to th a t i f d is c h a r g e g u a rd ia n t h e r e o f and th e a p p lie d . pay of re c e ip t t h e ’T ru s te e s of 1 (a ) i To in v e s t i . •‘ ( o r o th e rw is e to e x e rc is e : t h e ir d is p o s e d is c r e t io n o f o r d e a l w ith over .. b e n e f ic ia l o w n ers and th e „?•. > • th e g e n e r a l P o w e rs ^ c o n fe rr e d b y (b ) To u se ' th e *• j. ' a b s o lu te d is c r e tio n , and n o t w it h s t a n d in g c o n tra ry as s h a ll p ro p e rty be o f b e n e fit e x c lu s io n s h a ll t o o n e o r .m o r e s u b - c la u s e o f To b o rro w no th e im p o s e d b y any o f m oney o r g i v e in c o m e of th e th e th e T r u s t e e s o f fu tu r e in of any p a r t of th e w h ic h or any o f. c a p ita l o r th e and to p a y o r m oney fo r m in g p a r t a p p lie d and s o th a t j o i n t b o r r o w in g jo in t a n d n o p u r c h a s e r 'l e n d e r o r o t h e r p e r s o n th e p u rp o s e s o f t h is a s a le t o b e m ad e b y m o rtg a g e th e S e t t le m e n t s h a l l o th e rw is e to th e p r o p r ie t y o f th e ch arge T ru ste e s o r o th e r under o r fo r be co n ce rn e d to is w a n te d i s ra is e d th a n tr a n s a c tio n or th e see any th a t or a p p lic a t io n th e m oney. F u r t h e r and w ith o u t an y p r e ju d i c e p r o v is io n s d e le g a te th e T r u s t e e s any o r a l l of s h a ll be th e ir s h a ll v o c a tio n be a c tin g in th e he s h a ll be e n t it le d to g e n e r a lit y o f h is p ro p e r o f th e a u th o r is e d o r P cw ers lia b ility co u rse to th e e x p r e s s ly d u tie s any p e rs o n w h a ts o e v e r w ith o u t p erso n h ereb y under t h is fo r lo s s tra d e , fo re g o in g and i f to S e t tle m e n t su ch p ro fe s s io n re m u n e ra tio n out o f or th e T ru s t Fund. («_•) or s h a ll s e c u r ity T r u s t Fund w ith e n te r in to w a n te d o r t h a t n o m o re to th e o f o r o th e rw is e and w h e th e r o r n o t in v o lv in g t h e m oney i s of to r e s tr ic tio n g u a r a n te e s on th e F u n d m ay b e p a i d any p e rs o n p u r p o rtin g as su ch . an y m ann er in p a y in g o r a d v a n c in g m oney on t r a n s a c tio n th o u g h th e p r o v is io n s b o rro w ed o r g u a ra n te e d th e T r u s t or se veral lia b ilit y th e fo re g o in g h e r e o f o n ly la w o r e q u i t y h e re to . s h a ll h ave' pow er to a rra n g e m e n ts w ith and e v e n T r u s t Fund and an y o r e n te r in t o ra is e d c a p ita l o f o f th e to in v e s tm e n t o r d i s p o s a l o f o r in c o m e ) o f t h e t h e m oney s o th e ir o r o th e rw is e h e r e o f:., in c o m e a p p ly to ‘ an y p ro p e rty w h a tso e v e r even ch arge any fro m b e n e f i c i a l o w n ers g e n e r a lity th e T r u s t Fund w ith p o w e r t o (in c lu d in g d e ro g a te ~ B e n e fic ia r ie s any any r u le re p a y m e n t o f a n y m oneys s o (d ) th e a c q u ir e to a c c o r d in g ly be in a p p lic a b le (c) to y ie ld a p p ly an y o t h e r d e a lin g w ith lim ita tio n not c la u s e ; o r e q u ity o th e r B e n e fic ia r ie s s h a ll s h a ll a s s e t an d e v e n th o u g h su c h , p r o p e r t y s h a l l b e a w a s tin g o f th e th is r u l e o f la w Pow er to th o u g h s u c h p r o p e r t y c la u s e s i f t h o u g h .t h e y w e r e ‘ a b s o lu t e any have as an y w ay w h a t s o e v e r a c c o r d in g and w ith o u t p r e ju d ic e p r o v is io n th is fo llo w in g sam e T r u s t Fund an d . th e y w ere a b s o lu t e • T r u s t Fund in i th e th e Any T r u s t e e r e m u n e ra tio n h e r e o f w ho i s fo r a c tin g as a c o r p o r a tio n a T ru ste e s h a ll h ereo f in be e n title d a cco rd an ce to w it h its .a b s e n c e o f su ch r e a s o n a b le p u b lis h e d re m u n e ra tio n p r o fe s s io n a l p e rso n r e m u n e r a tio n fo r • r. j . t r a o n out o f T ru ste e in of fo r as so a fo r e s a id a c tin g w o rk , u n d e r t a k e n in c i^ a c ity o f T ru ste e h ereo f be p ro p e r out o f e n title d who i s e n title d c a p a c ity c a p ita l to be T ru ste e s h a ll h is t h e ’ .T r u s t F u n d ' ( e i t h e r e n title d s h a ll and an y any d e s c r ip t io n h e re o f s h a ll be th e s c a le as or p ro p er a p ro fe s s io n a l in c o m e ) T ru st a to and re m u n e ra tio n th e to any fo r a c tin g (e ith e r 1 Fund c a p i t a l o r in c o m e ) . ( f) The T r u s t e e s s h a ll t h e y m ay b e c o m e su ch lia b ility C o u rts of th e h a v e becom e (g ) o f any th e to p ay any p a r t fo r any d u tie s o f th e m ay n o t b e o f G u ern sey fo ru m th a T ru stee s or and w o r ld o th e r th ro u g h th e te r r ito r y as a d iiU .n l s t r a t i o n h e r e o f b y of th e ir P o w ers in th a t v ir tu e reg ard th a t m ay o f under • not be lia b le in o r P o w ers u n d e r t h is fr a u d u le n tly f o r w h ic h n o tw ith s ta n d in g e n fo r c e a b le o f su ch ta x e s . s h a ll d u tie s in a fo r e s a id Is la n d by The T r u s t e e s a c te d as 2 h e re o f. c la u s e Pow er lia b le th e th e e x e r c i s e have re sp e ct o f any. p u rp o rte d T ru st save th e y s h a l l rio t b e ' o n ly e n title d to th a t th e i f e x e r c is e th e y h ave p ro te c tio n c o n fe rre d h e re b y . (h ) H ie T r u s t e e s b e n e fit to (o r i f th e any o f in te r e s te d in th e su ch sh ares, s to c k s , b o n d s, in t e r e s t e d d ir e c tly , e ith e r d ir e c t ly a ll of w h ic h any th e y a re r u le T in - T r u s t e e s :.u c ia t io n of in te r e s te d e x p r e s s ly of is t in- T r u s t p r o p e r t y and i n it us t s h a ll "-‘ • • '• l u t i * d is c r e tio n . a c t in >• -t w i D i j i a n d i n g T r u iM y u s in any s h a ll th e su ch r u le or Vmvu n o t i c v a s s o c ia tio n of tin.- m a iin y o r s any act of o r p erso n s o f T ru ste e s a re . Fund in w h ic h th e y m ay i n v e s t any o r to th e to fo r m any of fo re g o in g see th e on or w o r ld tra d e fo r w ith p ow er th e fit to in in th e th e ir co n tra ry a n y w ay in v e s t m e n t o r b u s in e s s u n le s s c o n tro l o f e n tity c a r r y in g th e m s e lv e s or Fun d in co n tra ry . any p a r t th e th e m th e m n o t w i t h s t a n d in g o r o th e rw is e a fo r e s a id a re T ru ste e s th e co n ce rn any in th e y s h a l l d is h o n e s ty in o f in t e r e s t e d in conduct o f as th e be is p u rp o se o f o r e q u ity n ot be bound to th e m anagem ent o r i- u r ji e n t i t y th e e x e rc is e la w C om pany i n h e re b y a m anner a s of T ru st m anaged b y o r o th e rw is e fo r th e U n it o r I n v e s t m e n t T r u s t o r a u th o r is e d in v e s tm e n t o r o f o r w h ic h and t h e o r w h ic h o r e q u ity m o re o f to o f th e c o r p o r a tio n ) a ll a o f in c o r p o r a te d o r u n in c o r p o r a t e d tti.- p u r p o s e •! l l o r in d ir e c t ly , la w are any o r o r in d ir e c tly , any th e y b e lie v e t h a t O ne o r o ffic e r s d e b en tu res th e T ru s t Fund in w h ic h v e n tu re . *n»e T r u s t e e s h e r e o f m ay i n v e s t • ■ ■> any ve n tu re T r u s t n o tw ith s ta n d in g a c o r p o ra tio n p e r s o n a lly (i ) m ay e n t e r i n t o and u n t il m is fe a s a n c e any su ch on e n tity of th e T ru ste e s th e p art or of \ . a s s o c ia tio n as The T r u s t e e s w h o le o r a fo r e s a id . s h a l l h ave Pow er a t an y p a r t o f th e T r u s t Fund t h e ir d is e r e tio n V,v on t e i i j s to d is c r e tio n in k fj;t b u t so The T ru s te e s s h a l l h ave th e (1) le a s e c o n s titu te a u c tio n term s t h a t no su c h • fo llo w in g and e x c h a n g e a n y p r o p e r t y w h ic h tre a ty th e T r u s te e s and e n t e r in t o any o f i t as fo r to re s p e c t to e x e r c is e T ru ste e to c o n s titu tin g w ith o u t b e in g r e s t r i c t e d any c o r p o ra tio n p ro p e rty c o r p o ra tio n (b ) T ru ste e s as l e t o r h ir e t>crinq a p e r s o n le a s e * in t e r e s t e d d is c r e t io n to u se by o r th ro u g h o th e rw is e (cO any l o s s any s a l e th in k or c h a tte ls th e or of a c tin g of f o r e g o i n g w id e P o w e r s e c u r itie s or bond o b lig a tio n s of co n ce rn w h e th e r o r n o t th e o f th e T ru st a sse ts o £ an y su ch o r w it h o u t P o w ers on b e h a l f o f or th e T r u s t e e s to e ith e r any p e rs o n th e an d w h e re p e rio d s any o r any o th e r p e rso n in s p e c ie c o n v e rs io n th e is an y dam age or as of fo r are s h a ll to le n t: l e t p e rm itte d n o t be th e su ch such th e T ru s te e s la w fu lly t h e r e o f m ade b y s u c h any n e g le c t o r d e f a u lt s h a l l e x u r o iu fc (w h e th e r o r n ot c h a tte ls th e T r u s t e e s th ro u g h s h a l l h a v e Pow er g r a t u it o u s ly and fo r su ch fit in c u r r e d in c u r r e d th ro u g h Thu T r u s t e e s or o r co n ce rn ; any c h a t t e ls te rm s any o th e r p e r s o n fo r c o n s id e r co n tra cts a p p aren t s e c u r it y o r le a s e f o r v o tin g an d e n jo y any c h a t t e l s r c i; f o r c i b l e lim itin g o r th e h ereu n d er) m,iy i n to Fund o r to i n d i v i d u a l o w n e r m ig h t o r P o w e rs o f A tto r n e y w it h any o f su c h and upon s u c h o r h ir u d fo r th e p u rp o se s th e o w n ers o f an y su ch p r o p e r t y . c o r is i d e r a t i o n th e ir su ch a n y w a y b y .th e ; o f f i c e t r u s t a s s o c ia tio n W hore t h e T r u s t F u n d i n c l u d e s le n d and on t h e w h o le o r p a r t o f t h e an t r u s t a s s o c ia tio n o f s u b s titu tio n a t p u b lic T r u s t P e r io d . o f in t e r e s t in th e p u rc h a se g iv in g p r o x ie s tim e d is c r e tio n r e s p e c t o f any s h a r e s th e s e c u r it y or any c o n ta in e d ) n o te s o r o th e r e v id e n c e a ffe c tin g in (w ith o u t h e r e b y v o t in g upon o r i n s h a l l b e m ad e th e T r u s t u n c o n tr o lle d a l l P o w e r s w h ic h o r an y g e n e r a l Pow er h e r e in (a ) m ay a t th e . T r u s t w h e th e r o r n o t su ch in c lu d in g T ru ste e s a n d t o m a k e su ed ) c o n t r a c t s r e la t in g th e ir any p r o p e r t y th e T r u s t P e r io d . and w h e th e r o r d iv is io n su ch u n d e rta k in g s T r u s t Fund t o e x e r c i s e to lo a n su ch c o n s id e r a tio n deem a d v i s a b l e th e T r u s t e e s i n a d v a n ta g e o u s as o f th e T r u s t Fund e i t h e r u n d e r t a k i n g s e x t e n d o r m ay e x t e n d b e y o n d ' t h e W ith th e a d d i t i o n a l P o w e r s , n a m e ly t h e w h o le o r a n y p a r t o r by p riv a te as le n d • o f re in v e s tm e n t d i s t r ib u t i o n (2 ) fr u a t h a t re p a y m e n t s h a l l b e p o s tp o n e d b ey o n d th e To s e l l to any p e r s o n s w h e th e r a B e n e f ic ia r y a s ; -i-o i e p a y p j c r i . t ' a n d i n t e r e s t o r i n t e r e s t su ch *£ erm s may i n a b s o lu te 7 ? ,u s t h e r e b y d e c l a r e d w i t h o r w i t h o u t s e c u r i t y a n d u p o n o r n ot u n < ^ r‘ th e ? th e ir sa m e c a u s e d p erso n or p erso n . P o w u rs and d i s c r e t i o n s v e ste d in W-vJ . any . S e tt le m e n t • (b ) ■ ol th e p erso n s a c tu a lly fo r b e in g o b lig e d to c o n s id e r .» ** **’’ s h e 'l l b e ” in • (o r r e fr a in e x e r c is in g ) any in t e r e s t th e th e d is c r e t io n s h a ll have to e x e r c is e th e any su c h lia b le a c tin g to be a p p o in te d s e r v a n t o f a n y com pany e v e n b y h im o r b y in The T ru s te e s th o u g h h is th e T r u s t Fund o r w r itin g p r o p e r la w o f t h i s i r r e v o c a b le to by D e s p ite o r D eed o r D eed s a s up o x r e s tr ic t fid u c ia r y a n y th in g c o n t a in e d e ls e w h e r e a p p lic a b le IT.I o r on a n y p e r s o n a c c o rd in g to any w ays a s rs 10 . (a) to v o tin g r u lo if in a fo r e s a id (c) to th e th e s a id T ru ste e s a c c o rd a n c e w ith and s h a l l th en is T ru ste e a c c o rd in g to T r u s t P e r io d or o r by la w th e c o n fe rre d P o w e r. S e t t le m e n t n o d i s c r e t i o n o r D eed a s th e or m ay b e ' S e t t le m e n t on t h e e x p ir a t io n in th e be o f T ru ste e s th e T ru st e ix e r c is e d in e v e n t o f no T r u s t e e Pow er s h a ll v e s t in th e P erso n al g iv e s a id h e r e o f w ho d e s i r e s (b ) of to T ru ste e or if T r u s te e who i s w ith d r a w to th e th e o n ly a d d itio n a l (a) o f th is T ru ste e a cco rd an ce w it h in th is s h a ll p r io r fro m ; h e T r u s t h e r e o f d o o r c a u s e of a d d it io n a l t o w it h d r a w c la u s e T ru ste e d e s ir o u s o f p a ra g ra p h s a id and b e m ay d o s o b y a p p o in t o n e o r m o re th e p r o v is io n s A ny T r u s t e e o f p a rag rap h th e th e n o tic e : t im e d e s i r e s h a ll as a fo r e s a id . d isc h a r g e th a t a t any o r T ru ste e s p r o v is io n s to In stru m e n t o r any su ch re m a in in g T r u s t e e s w it h d r a w in g c la u s e a fte r a tta c h e d l a s t T ru ste e h e r e o f. t h e m a t e r i a l .tim e in th is o f th is fr o m t h e T r u s t s h e r e o f w r it in g h e re o f a t or a g a in s t p e r p e t u it ie s . any T r u s t e e h e r e o f s h a l l n o tic e o f h is fro m e x e r c i s i n g o r Pow er as a fo r e s a id th e T r u s t e e s h e r e o f p r o v id e d d is c h a r g e d any a p p o i n t n ew o r a d d i t i o n a l T r u s t e e s h e r e o f s h a l l . v e s t R e p r e s e n ta tiv e s o f th e (b ) fo r . th e o f w r itin g e x e r c is a b le any h e r e o f re m a in in g th e sr c o r p o ra tio n rig h ts tim e s b y d u r in g in in co n seq u en ce a p p lic a b le n a tu re p r o p e r la w d is c r e tio n in fr in g e m e Pow er t o in th e s h a ll be P e r io d , n o r s h a l l su ch in any P ow er h e re b y Pow er c o n fe r r e d b y t h i s . I n s t r u m e n t i n it account an .a b s t e n t io n a n y t im e o r S e ttle m e n t r e v o c a b le g iv e o f any ' o n th e m n o t w i t h s t a n d i n g t h e 17 . and u n c o n tr o lle d a p p o in tm e n t w a s p r o c u r e d b y th e T r u s te e s o f s h a ll h ave Pow er a t In stru m e n ts in v e ste d a d ir e c to r o r o th e r o f f ic e r such v o tin g r i g h t s . ) ( ,. Pow er th e P o w er. to r e o e i v e d b y h im s e c u r itie s in sam e d i s c r e t i o n re m u n e ra tio n o r o t h e r p r o f i t an e x e r c i s e v e ste d • h e re o f s h a ll be o r b e in g o r o th e r. and e v e r y h e re o f o r d ir e c to r o r o th e r o f f ic e r as Pow er th e m w it h o u t o th e rs a t t h e ir a b s o lu te T ru ste e s a T ru ste e th is , e x e r c is a b le d e c id in g w h e th e r o r n o t w h ic h i s every * and No T r u s t e e of m ore o f and u n c o n t r o lle d . d is c r e tio n fro m any one o r s u b -c la u s e . th e m s h a l l b e of th e a b s o lu te > •I’’* (c) under th e b e n e fit S u b je c t y x b - th e . .p r e v io u s T ru stee s in te r e s te d a n d m ay e x e r c i s e or d is c r e tio n * * . . •£ ' o r p ro tip e c ti v e l y to be done to a ll th e h is su ch a cts any of the persons actually or prospectively interested under this Settlement and may exercise (or refrain from exercising) any Power or discretion for the benefit of any one or more of them without • . ■ being obliged to consider the interest of the others or "other. Subject to..the'jprevious sub-clause every discretion vested in the Trustees"shall be absolute and uncontrolled and every Power vested r t r" . ■ rs it : . iij- 'them shall be exercisdble at their absolute and uncontrolled discretion and the Trustees shall have the same discretion in deciding whether or not to exercise any such Power. (c) No Trustee hereof or director or other officer of any corporation which is a Trustee hereof shall be liable to account for any remuneration or other profit received by him in consequence of his acting as or being appointed to be a director or other officer or . servant of any, company even though his appointment was procured by an exexcise by him or by the Trustees of voting rights attached to . securities in the Trust Fund or by an abstention from exercising such voting rights. 1 1 .. The Trustees shall have Power at any time or times by Instrument or Instruments in writing or Deed or Deeds as applicable according to the proper law of this Settlement revocable during the Trust Period or irrevocable to give up or restrict any Power hereby or by law conferred on them notwithstanding the fiduciary nature of any such Power. 17. Despite anything contained elsewhere in this Settlement no discretion or Power conferred by this Instrument in writing or Deed as may be applicable according to the proper law of this Settlement on the Trustees or on any person shall be exercisable after the expiration of the Trust Period, nor shall such discretion or Power as aforesaid be exercised in ' any ways as to infringe any rule against perpetuities. . 111. (a) The Power to appoint new or additional Trustees hereof shall vest in the Trustees hereof provided that in the event of no Trustee hereof remaining the aforesaid Power shall vest in the Personal Representatives of the last Trustee hereof. 0>) I C any Trustee hereof shall at any time desire to withdraw and be discharged from the Trusts hereof the said Trustee may do so by notice in writing to the remaining Trustees or if the only Trustee hereof at the iiaterlal time is the Trustee who is desirous of withdrawing the said Trustee shall appoint one or more additional Trustees in accordance with the provisions of paragraph (a) of this clause and shall then give notice to the said additional Trustee or Trustees as aforesaid. (c) Any Trustee hereof who desires to withdraw in accordance with the provisions of paragraph (b) of this clause shall prior to his and deeds as are necessary for the proper vesting of the Trust Fund in the continuing or new or additional Trustees as the case may be. (d) All such acts and deeds as aforesaid shall be done at the expense of the income or capital of the Trust Fund PROVIDED THAT an outgoing \ .. ■Trustee-who*'is liable as a Trustee hereof or who may at the death of - any person be liable as a farmur Trustee hereof for any taxes which ■ :> ^y be imposed by the Proper l^aw or elsewhere shall not be bound to transfer the Trust Fund unless reasonable security is provided for * indemnifying such outgoing Trustee against such liability. (e) On every change in the Trusteeship a memorandum shall be endorsed on or permanently annexed to this Sottlemont stating the names of the Trustees for the time being and shall be sighed by the persons so named and any person dealing with the Settlement shall be entitled to rely upon such memorandum (or the latest of such memoranda if more than one) as- sufficient evidence that the Trustees named therein are the duly constituted Trustees- for the time being hereof. . (£) In the event of no person entitled under the foregoing paragraphs of ‘ . ’ this clause appointing a new Trustee hereof within one month of the last Trustee hereof ceasing to be a Trustee the Power to appoint one or more new Trustees of the Settlement shall vest in the most senior practising Advocate for the time being of the Guernsey Bar. If a Trustee retires from the Trust hereof or becomes by reason of residence or place of incorporation incapable of acting as a Trustee hereof such Trustee shall be released ipso facto from all claims demands actions proceedings and accounts of any kind on the part of any porson (whether in existence or not) actually or prospectively interested umtor the Settlement for or in respect of the Trust Fund or the income of tlu- Trust Fund or the Trusts of this Settlement or an act or thing done ur omitted in execution or purported execution of such Trusts other than and except only actions:(]) arising from any fraud or fraudulent breach of Trust in Which such Trustee (or in the case of a corporate Trustee any of its officers) was a party or of which such Trustee had knowledge; .. (-’ ) ro recover from such Trustee Trust property or the proceeds of Trust property in the possession of such Trustee (or in the case of a corporate Trustee any of its officers) and converted to his use. Jn th « u x u c u tio n liiiM o fo r any laiJure lo s s d e p r e c ia tio n iv .is o n o f o r th in g of any a c t or th e to or T ru s ts th e T r u s t Fu nd a r i s i n g lo s s o m is s io n except w ilf u l and P o w e rs h e r e o f n o T r u s t e e o f any in consequence i n v e s t m e n t m ade made i n and i n d i v i d u a l good f a i t h fra u d s h a ll in or of good of th e fa ith any o th e r arid w r o n g d o in g be on t h e o r by m a tte r p art of j]. T b i; T r u s t e e i. i . h u l J ox o f C u u r in ji-y ih b d i s c -J o s c - d i r e c t l y . . .t j.n f o r i ii .i t i o n usseu; or a q t d 't o th e 22. T h is 23. Th e 24 . P ro p e r or th e of m e m o ra n d u m re c o rd in g T h is «is. d e f i n e d to any th e . T r u s t of lo w i n .c la u s e ta x Fund o r t h t :r « -o f be known S e ttle m e n t to o rig in a l Law c o m p u ls io n or th t- except of th e Is la n d 2 h e re o f, d iv u lg e f i s c a l 'a u t h o r i t y any Tru s t th e th a t o f liu e d o r to r e la tin g to th is o r c la u s e s c h e d u le . s h a ll th is u tid u r in d ir e c tly h c lit* / ic ia riu s th ird d is c re tio n th e except K C la t t y i ^ 't o S e ttle m e n t nam e not such tru s t o t h e r nam e each an '•Hie K a t h i i r J n a m ay b e and or changud b y nam es e v e ry as th e y change Tru s t. th e Tru s te e * c o n s id e r a t f it . o f nam e . s h a l l b e t h e ir A a f f ix e d to deed. S e ttle m e n t s h a ll be irr e v o c a b le . r iR S T SCHEDULE • £10 (T e n ' pounds) SECOND SCH ED U LE . Je rs e y . Fund fo r Je rs e y O x fa m Je rs e y W ild lif e B lin d C h ild r e n G ro u p P r e s e r v a t io n Tru s t TH 1 JR P S C H E D U L E ■ 1. The 2. A ny p e rs o n who i s . as • IN W IT N E S S s e a ls TH E th e r e s id e n t G u e rn s e y fo r ta x a tio n in W H EREOi-' t h e d a te S e ttlo r and ye a r p a rtie s firs t L E N G S TE N L IM IT E D was h e re u n to in TH E th e in th e th e th a t / th e L IM IT E D a ffix e d p re s e n c e o f :- Is la n d of of h e re u n to above w r it t e n . o f :- TR U STEES tre a te d p u rp o s e s have COMMON S E A L o f h e re u n to is . . ' . . Is la n d a ffix e d p re s e n c e S O V E R E IG N was in h e re to j ■TV, COMMON S E A L o f . or <3('r e * , ? set th e ir hands and .6- .J2i IT is h e r e b y a g r e e d a n d d e c l a r e d th at the p r o p e r t y c o m p r i s e d in t h e T r u s t Fund s h al l as an d from .the d ate h e r e o f vest in the N e w T r u s t e e in the p l a c e of the R e t i r i n g T r u s t e e f or all the e s t a t e o r in te r e s t t h e r e i n the n s u b j e c t t o t h e . trusts o f t h e S e t t l e m e n t a n d t h e Ret i r i n g T r u s t e e a n d t h e N e w T r u s t e e • will p r o m p t l y do o r caus e t o b e e x e c u t e d all m a t t e r s t h i n g s d e e d s a n d d o c u m e n t s (if any) fo r c o m p l e t i n g the t r a n s f e r o f the s a i d p r o p e r t y i n t o the n a m e o f the Ne w T v u s t e e a c c o r d i n g t o th e n a t u r e . t h e r e o f to t h e i n t e n t th at t h e s a i d p r o p e r t y s h a l l h e n c e f o r t h b e h e l d by the N e w T r u s t e e u p o n the t r u s t s a n d . w i t h a n d s u b j e c t t o the p o w e r s and pro vi s i o n s in the S e t t l e m e n t contained. 3. THE New Trustee hereby releases'and d i s c h a r g e s t h e R e t i r i n g T r u s t e e .from actions p r o c e e d i n g s a c c o u n t s claims and d e m an ds for o r in r e s p e c t o f any act o r thing d on e p e r m i t t e d o r s u f f e r e d . by the R e t i r i n g T r u s t e e in o r about the ex e c u t i o n o f the t r u s t s of'.the S e t t l e m e n t or for o r in r e s p e c t o f any o t h e r thing in any way r e l a t i n g to the premises. IN WITN ESS w h e r e o f the p a r t i e s h e r e t o .have c a u s e d th eir Common Seals t o b e a f f i x e d the day and y e a r first above written. Till-: SCH1SPULK hcroinbGT.org~rgrex Cash £10 (ten pounds) THE COMMON SEAL of SOVEREIGN TRUSTEES LIMITED was hereunto affixed in the presence of: THE COMMON SEAL of COLLEGE TRUSTEES LIMITED was hereunto affixed in the presence of ywTq peed OF APPOIHTMBNT is made the day of * One thousand nine hundred and eighty-eight BV COUMGB TRParKgS LIMli'KU, of Plateau Mignot, Rue des Cornets, Saint Peter Port, in the Island of Guernsey (hereinafter called "the Trustees") SUPPLEMENTAL to:(1) A settlement (hereinafter called "the Settlement") dated the 12th day of October, 1977 and made between Lengsten Limited of the one part and Sovereign Trustees Limited of the other part; and (ii) A Deed of Appointment of New Trustees dated the 12th day of Jrfnuary, 1978 and made between the said Sovereign Trustees Limited of the one part and the Trustees of the other part. WHEREAS: (A) ' •' . . . under and by virtue of the'said Deed of Appointment the Trustees became and now are the Trustees of the Settlement. (B) under Clause 7 of the Settlement the Trustees thereof are-'empowered to include any person or class or persons in the class of beneficiaries thereof and are presently desirous of making such appointment thereunder as hereinafter appears. (C) By virtue nt Clause 1 (a) of the Settlement the details of the . .. beneficiaries thereunder are set but in the Second Schedule thereto. WOW THIS DEED WITHESSETH and it is hereby declared:(1) That by virtue of the power and powers contained in the said Clause 7 of the Settlement and all and any other powers them hereunto enabling the Trustees hereby declare that the children and more remote issue of Hazel Grace Newman of Tingrith Manor,. Tingrith, Milton Keynes, Bedfordshire, England now in existence or b o m hereafter before . determination of the Trust Period shall be the sole class of ’ .. kene*iciaries thereunder as if the same were specifically and solely ••’ . * ' mentioned in the Second Schedule thereto to the intent that the class ' or classes of beneficiaries as heretofore specified in the Second - Schedule thereto shall be excluded and shall be henceforth substituted by the said new provision. (2) ‘ ■ The Trustees hereby confirm and declare that, as soon as this Deed has been executed they will endorse upon the Settlement the details above class of new beneficiaries. rw wiTKSSS of the • .■ ' WHEREOF College Trustees Limited has caused its Comon Seal to be hereunto affixed this day'and year first above written. . ■ . . . . . .■. *• 7 -— * PK*n OF is made the day of j r . >THIS e thousand nine hundred and eighty-seven BY COLLEGE TRUSTEES LIMITED, of APPOINTMENT ------ * fir.~ ■ P3 £^«.set out in the Second Schedule thereto. :J'V' NOW THIS DEED WITNESSETH and it is hereby declared:- • (1) That by virtue of the power and powers contained in the said Clause 7 of the Settlement and all and any other powers them hereunto enabling the Trustees hereby declare that the children and more remote issue of ^ ^^ Hazel Grace Newman m o w irr existence or born hereafter before the J . _{ termination of the Trust Period shall be included among the class of ' //^«/yUkluon beneficiaries thereunder as if the same were specifically mentioned in the Second Schedule thereto. (2) - '*.r The Trustees hereby confirm and .declari? ^shat, as. spon as this Deed has been executed, they will endorse vipon the .Settlement.;'the details of the above class of new beneficiaries. - coma SEAL of 901.13? mm LIKE-TED . "mercanto affixed in 'thvl' wrosonce ■) ‘ SMITH ’ , > F O Y & PART N E R S SOLICITORS • 59 FITZW-ILLIAM'SQUARI:. t>UHLW2. Telephone: 760531 (6 lines). 762764,762765.767048.767065. Iiui- box-Mu. ' T*l« No. 9JK«6 • uuiKei XKS/AK . V>iorXd. Dictated: 21st January 1987 22nd January 1987 Dear Michael, _ ^ Re: The Katharina Trust . ._______________________ _ . further to our telephone conversation to-day I confirm that I spoke with Mr B.R. Ellis of College Trustees Limited on the telephone yesterday and as a result of our conversation I have to-day written to M m as per copy enclosed herewith. I note from my telephone conversation with you to-day that you would prefer to have the beneficiaries of the Katharina Trust defined in the trust deed as "the children and more remote issue of Ha?el Grace Newman now in existence or born hereafter". You will note my comments to Mr ' Ellis in relation to the legality or otherwise of using your wife's maiden name. I will write you further as soon as I hear from Mr Ellis. Yours sincerely, * 3 HcS ll T.K. SMITH Mr Michael J. Shanley 50 Reginald Street Luton . Beds. England. - f . S • CCfy UJbSi, M A J*»»> *» t ri>)MrK II.C.l. . J ftC I . R. A ( r SMITH ' F O Y & P A R T N E R S S O L IC ITO R S 59 FITZWILLIAM SQUARE, DUBLIN 2. Telephone: 760531 (6 lines),762764,762765.767048.767065. DDK BOX ’ «>. V- Telex No. 91886 . <>ur Kcl. TKS/MA Your Ref. MJS/PQ/Plain 18th February 1986. Dear Michael, Re: Katherina Trust. I have your letter dated 6th February 1986 and now send you copy of further letter which I have today written to Sean Mooney. I received a letter from Gary Britton of S.K.C. dated 11th February 1986 enclosing the amended accounts for Maybach Investment Coupany Limited for the years ended 31st October 1983 and 31st October 1984. Before signing sane z would like to have confirmation from you that you have been furnished with copies of the anended accounts for the said years and that you are satisfied with s a m e . ■ Whilst Mr. Britton has requested that I should sign the accounts and return then to bin forthwith 1 would prefer to await your next visit to Ireland and to sign them in your presence. 1 note from the accounts that Denis O ’ Do no van was Secretary of the Company for the year ended 31/10/1984. You will require a change in that position if not already implemented. Yours sincerely, ___ /-C-' j U l - T.K. SMI3 Mr. M.J. Shanley, 50 Reginald Street, Luton, Beds., England. M. A. I .iv. ti. I' I miwiiv H.C I. . I (i. Oul) ll.C.I .. I< A. CJ.-II.-kI> II.C I. 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' t r . t suae appear ch«n *as« will b« ir.s^rc^-.'. . . . ‘ .*'r v * •}a, SMITH FOY t PARTNERS. c.c. I ..p m ( II ( I . .1. l i . I>;.lv H .C I . Sean Mooney S.K.C. K . A . (Jull-ijsly H .C 1. I k. Slllllil II C* I .. i.i U S M I T H / \ waM F O Y & P A R T N E R S S O L IC IT O R S SQUARE, DUBLIN 2.Telephone:760531(6lines),762764,762765.767048,767065.ODE BOX 2-w. Our R«r. TKS/MA. Your Kef. 22nd November, 1982. Dear Sean, Re: Michael J. Shanley. 1 Maureen O'Brien Settlement. The Katharina Trust._______ I refer to the meeting which took place at your office an the 5th November 1982 attended by myself and Michael Shanley at which we had a further discussion regarding the above matters. . . • . I have examined the contents of the copy Deeds setting up the above two Trusts. The documents in question merely set up the rules for the operation of the Trusts but they do not give any information as to the actual ownership or movement of funds within the said Trusts. It would . appear from the verbal information which-you-have given to us that the original finds from the sale of property in Raheny was put into the Maureen O'Brien and subsequently lent by that Trust to a Cayman Island Ccnpany called Keeladrura which maintained the finds on deposit In the Cayman Islands and the said funds were used to obtain loans on a back to back basis for KillineyManagement Limited. The Trust Fund then appeared to.have been transferred from the Maureen O'Brien Settlement to the Katharina Trust which was set up in Guernsey in 1977 and the Katharina Settlement formed a new Company in Ireland called Maybach Investment Conpany Limited and lent the Trust Funds to it for investment in Irish properties. We note that all the issued share capital in Maybach is held by the Katharina Trust. I gathered frcra you that the sole, trustee of the"Maureen O'Brien Settlement at this stage is K.A. Lawless and the trustee of the Katharina Trust is College Trustees Limited. The latter Conpary is, I understand, a Guernsey Ccnpany set up by Guinness & Mahon Limited. . Mr. Shanley expressed a preference for having the trustee of the Katharina Trust changed from the Guernsey Ccnpany to. your firm's Trustee Company. It would be helpful if you could confirm the above information to us for record purposes and at the same time procure copies of the relevant Minutes or notes maintained by the Trustees of both Settlements relative to the various activities of the Trusts and the movements of funds therein. I would like to have more clear information as to the exact relationship between the Maureen O'Brien Trust and the Katharina Trust. There is power in the Settlement setting up the Maureen O'Brien Trust for the Trustees '.'to appoint that the whole or any part of the Trust Fund be held upon the Trusts and with and subject to the powers and provisions of any other Settlement etc" (Clause vii of the Settlement Deed). .A copy of the appointment-made by the Trustees of the Maureen O'Brien Settlement whereby the Trust Fund was transferred to the Katharina Trust should be available as'ialso should the documentation which relates to the ownership in the Shares iri NJaybach' by the .Katharina Trust. M. A. Foy. C. C. Fogany B.C.L.. J. O. Daly 8.C.L.."'R. ArCullogly B.6.L. <~niuul»ni T. K. Smith B.C.L.. LL.B. ft. M. Manio B.C.L.. W. J. Keane B.C.L., P. J, Cusack 8.C.L. juld also be interested to know whether any docunent exists which more early defines for the Trustees the identity of the beneficiaries of the atfc&gina Trust. ' Perhaps you would look into the above matters and procure the necessar details for me so that the way may be made clear for the proposed change of Trustee of both Settlements. , Mr. Seam Mooney A.C.A. Stokes Kennedy Crowley & Co., Chartered Accountants, HarcourtriHouse, Harcourt Street, Dublin 2. .. c . c . M . J . Shanley. v.9? .- at. ?to: I l. '6 been er 1&62 val-2?: - i I . - noisri'gn i Settlement ww-am-m- 0.1" a :21?Er-5.323 . -, . woJ'lotto??tmc'ung ha?ppaned. -- .morc is ?no I .. "Linq'tha frogs the ?magi, happer?aod in ?nctice was phat:rf?dd?ag?r?e 3125;253:224 to-the account Mayhach . Guinness The funds were uged to . a mum- ms ~9ran=act?on - 2 . .. oaH- - rue-WWInth?- -. ?int. F?s . 49g55mg moir?qgngie is 1 . . . A vJ'f- - . - fund-I TrustMnn?M??d-m ch' ~hummumam: - l' kw11?" M: . mi - 93729429399592 -. ?9 aunt: settled ,the .?fundsuon 9 up} . . - 5' w??E?Ei'l?i??aw??g?dw??xistx??-Epns??es; ?Pkahould?be? ?13' c'ftnat ath? 1151:" . .tiivan- I33353? .as Ehg?mrt 8813.? "asehwdlanned . - .--, ?dfshould bar-repl 34:11:! 513..-. maxim-."nu. . . . n" veecometours; ,tv. .. . - .. M-bu-?uqu?II. u. a. .- l??00aha.? . P, . 0' ??af'. - . {Agffg?ntk 01*- -. . :?xwm?s; I that?.10?ughcs gr. .I I "?wv-?aw} - - . . 0 limit UNDER OATH ON, 27TH SEPTEMBER 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. T.K. SMITH 1 2 2000 3 4 MR. SMITH: Is it possible I could 5 move up near you. 6 would look more like an interview than 7 a. ..(INTERJECTION) 8 MR. JUSTICE COSTELLO: 9 It If you don't mind staying there Mr. Smith 10 because the stenographer has to hear it. 11 MR. SMITH: I see. 12 It just looks a bit confrontational the 13 position I am in down here. 14 MR. JUSTICE COSTELLO: Well, if you don't mind? 15 MR. SMITH: That's fine, that's okay, 16 no, I thought it was a 17 friendly interview. 18 MR. JUSTICE COSTELLO: It's an interview and I 19 will just explain 20 now, Mr. Smith. 21 you know my name is Declan Costello and on my right 22 is Ms. Mackey and on my left is Mr. Rowan. 23 know we have been appointed by the High Court to 24 conduct this investigation and this is an inquiry, 25 so, we would be under oath, as you know and we are 26 anxious, the matters in which we have indicated our 27 interest have been set out in our letter to you and 28 what I propose would be that Mr. Rowan would ask you 29 some questions first. We will start our interview. Perhaps if I ask our As As you solicitor to administer the oath to you first. 1 2 3 MR. ROWAN: Good morning Mr. Smith. 4 MR. SMITH: Good morning Mr. Rowan. 5 1 Q. First of all thank you very much for letting us have 6 your statement that was very helpful. 7 it to hand? 8 A. 9 2 Q. 10 A. 11 Have you got I have, yes. Perhaps we could refer to it (Exhibit 1)? My statement being my letter of the 25th of July 2 000 , is that correct? 12 3 Q. 13 A. 14 4 Q. That is correct. Yes, I have that with me. Perhaps you might start generally, Mr. Smith, by 15 telling us how long your firm has acted for 16 Mr. Shanley and for Maybach? 17 A. Well, for Mr. Shanley I would say that I met him 18 some time towards the late 60's. 19 solicitors, other that ours were acting for him at 20 that particular time. 21 man called Michael Liddy, who is a cousin of mine 22 and over the subseguent years, probably late 60's 23 early 70's, we would have done some work but not 24 anything major for Mr. Shanley. 25 handled -- he did some building work here through a 26 company or he was involved with a company in 27 building and ultimately we got the major part of his 28 work, which would be towards the end of the 7 0's 29 probably. A firm of He was introduced to me by a His own solicitors 1 5 Q. 2 3 So, you would have acted for Mr. Shanley in terms of his corporate activities? A. Well, Mr. Shanley is a man from Leitrim and 4 corporate activities is probably a very fancy word 5 for him. 6 and he would have come over -- I suppose corporate 7 in the sense that he was involved in -- he had 8 companies mostly, well, we did personal work for him 9 as well. 10 6 Q. Mr. Shanley left Ireland when he was 15 Just dealing with corporate activities, what I was 11 intending to mean from that was company work, buying 12 and selling property? 13 A. Well, more conveyancing than company, we wouldn't be 14 into company work as such, our firm would be more in 15 conveyancing, licensing. 16 7 Q. 17 18 But you then said that you also acted for him in his personal affairs? A. Well, again my difficulty here as a solicitor is 19 that I would prefer to discuss matters just relevant 20 to your company rather than relevant to a client 21 over a number of years. 22 it is sworn, I would be loathe to be saying the type 23 of things -- but I did, yes, I would consider him a 24 friend of mine apart from a client. 25 8 Q. It is going on record and Then turning to your statement, the first page of 26 your statement, where at point number 27 about the Katharina Trust 28 A. 29 9 Q. (c) you talk (Exhibit 1)? Correct. Which you say was set up in the Channel Islands 1 2 A. Your question, if you would read your questions to 3 me first you would see the context of my answer. 4 Your question was...(INTERJECTION). 5 10 Q. I am just asking you really to confirm what you are 6 saying in your statement which is that "The 7 Katharina Trust was set up in the Channel Islands 8 circa 1977." 9 A. 10 11 Q. 11 Correct. And that "the initial trustee was Sovereign Trustees"? 12 A. 13 12 Q. 14 Correct. And "they were subsequently replaced in 1978 by College Trustees Limited"? 15 A. 16 13 Q. Correct. Then if you go over the page, Mr. Smith, you say 17 that your "understanding is that the ultimate object 18 of the Katharina Trust was to benefit the Shanley 19 children"? 20 A. 21 I said that my understanding was that the ultimate object, that was my understanding. 22 14 Q. 23 A. How many children does Mr. Shanley have? Well, he had one girl who unfortunately was killed 24 in a motor accident but to my knowledge he would 25 have -- again I may not be totally accurate on this 26 but I would say that he has five surviving children. 27 15 Q. 28 A. 29 Are they boys or girls? He has two boys to my knowledge but again I wouldn't be -- as I say I am a friend of Mr. Shanley's -- I 1 wouldn't be a visitor to his house and I wouldn't be 2 -- well I would not say friendly terms -- but I 3 wouldn't be in close communication with his family. 4 16 Q 5 A You said...(INTERJECTION)? I can find out for you exactly the names, I am sure 6 there is no problem in Mr. Shanley supplying the 7 names of this children. 8 17 Q 9 A That would be helpful, please, if you would do that? Yes. He has a son a barrister his older son is a 10 barrister and to my knowledge he has another son and 11 he would have at least two daughters apart from the 12 girl that was killed in the accident. 13 18 Q 14 on that in any way? 15 A 16 19 Q 17 18 The creation of the Katharina Trust, did you advise No. Have you any knowledge as to who did advise Mr. Shanley on the creation of that trust? A I wouldn't have any direct -- most of the knowledge 19 I have of the two trusts, the Maureen O'Brien Trust 20 and the Katharina Trust, would have come from 21 research I would have done from late in 1982 22 onwards. 23 people. 24 of the people I would have sought information from. 25 We will come back perhaps to that issue in a moment. 26 Do you know whether, besides the Shanley children, 27 there were any other beneficiaries of the Katharina 28 Trust? 29 Named category beneficiaries or actual I would have sought documentation from Stokes Kennedy Crowley would have been one 8 1 2 21 Q 3 4 Let's start with categories. Were there any other categories of beneficiaries? A 5 There were Categories people who would be beneficiaries, yes. 6 22 Q 7 A 8 Potential beneficiaries. Can you outline those to us please? Well, to my knowledge it was exclusively a charitable object, when it was set up. 9 23 Q 10 A Yes . And I would not be in a position to give you -- a 11 lot of what I would be telling you would be hearsay, 12 it is hearsay of information gathered by me as a 13 solicitor acting for Maybach and acting for 14 Mr. Shanley. 15 24 Q 16 17 What you have indicated is that there were at least two categories of beneficiaries? A No. What I said was that initially my understanding 18 was that is was, as the document was drawn, it was 19 exclusively for charitable purposes. 20 25 Q 21 A Exclusively for charitable purposes? That is my understanding. I think you better 22 preface anything I tell you with the words my 23 understanding because I wasn't directly involved in 24 these things and I can only base my information to 25 you on information I subsequently got by asking much 26 the same questions as you are asking me. 27 What I am trying to do is just get an understanding 28 of the Katharina Trust? 29 Basically my understanding, which I would have set 9 1 out in the letter to you, was that the Maureen 2 O'Brien Settlement was set up in 1970. 3 better start from the beginning because it leads on 4 to the Katharina afterwards. 5 27 Q. 6 7 I think we I would prefer to take it my way, if you don't mind please? A. In my mind the sequence -- we are talking about 8 things that happened 30 years ago, 20 years ago and 9 in my mind I would Okay, obviously you are in 10 control but it would be easier for me if I told you 11 what I know in relation to the sequence of events. 12 28 Q. Well, I was hoping that we would deal with the 13 matters that you wish to tell us about. 14 wanting to understand and your letter said that the 15 ultimate object of the trusts was to benefit the 16 Shanley children but you then added that there were 17 other classes of beneficiaries and then you 18 explained that the trust was set up originally for 19 charitable purposes? 20 A. I was This is why I would like it in context because when 21 you ask me these questions and I say the it was my 22 understanding that it was that it was set up for the 23 Shanley children, the first trust was set up with 24 S.K. Trust, which is which is a Stokes Kennedy 25 Crowley Trustee company and the Governor and Company 26 of the Bank of Ireland, who are very reputable 27 people I understand, were the trustees of the 28 original settlement. 29 the children of Mr and Mrs. Shanley, I think it was One the objects was to benefit 1 Brigid Shanley and whatever her husbands name was, 2 they would have been Mr. Shanley's parents, to 3 benefit their grandchildren, that was one of the 4 objects of that trust or one of the stated 5 beneficiaries of the trust. 6 29 Q. 7 A. 8 30 Q. 9 You are talking about the Maureen O'Brien Trust? Correct. Maureen O'Brien Settlement. Settlement, excuse me, yes. If you would like to do things that way then let us do that. So, the 10 Maureen O'Brien Settlement was set up in 1970, you 11 said in your letter, circa 1970? 12 A. 13 31 Q. 14 A. 15 32 Q. 16 You say it is a trust established in Ireland? Correct. I suppose the first thing really is, who advised for the setting up of that trust? 17 A. 18 33 Q. 19 20 Correct. Stokes Kennedy Crowley. Using a vehicle which you described a moment ago, will you just repeat that, S.K. Trust or something? A. K.C. Trust and the governor of Continental Bank of 21 Ireland, who would be far removed from Michael 22 Shanley at that stage I might tell you. 23 34 Q. 24 S.K.C. in terms of the setting up of that trust? 25 A. 26 35 Q. 27 A. 28 36 Q. 29 So, Mr. Shanley sought advice from Correct. Were you also involved in the advice at that stage? No. Who was it actually established the trust? Who were 1 The Trust had an initial trust fund, I think of £100 2 and it was established by Maureen O'Brien who is the 3 sister of Michael Shanley. 4 37 Q 5 A Yes ? And I would presume that it was through the 6 endeavours -- I don't think Maureen O'Brien would 7 have sought advice from Stokes Kennedy Crowley, I 8 think it was through the endeavours of Michael 9 Shanley that it would have been set up. 10 38 Q I take it that if you weren't involved in advising 11 in the setting up of that trust that you would not 12 therefore have seen any of the trust documentation, 13 is that correct? 14 A Correct. I didn't see it until 1979, I would think, 15 around '78/'79, is the first I would have seen 16 anything of it. 17 39 Q 18 19 When you say you saw it, does that mean that you had access...(INTERJECTION)? A I was sent a copy of the Maureen O'Brien Trust 20 documents by Stokes Kennedy Crowley and requested to 21 prepare a document to change the trustees from 22 K.C. Trust and the governor of the company of the 23 Bank of Ireland to Kenneth A. Lawless and that 24 document was prepared and signed in 1980. 25 40 Q 26 A 27 28 29 Have you retained a copy? Yes, I could furnish you with a copy if you direct me to do so. 41 Q Yes, please, we would appreciate a copy of the documentation creating the Maureen O'Brien 1 2 A. Yes. The actual Settlement document itself, I would 3 have a copy of it, not a copy of the document 4 changing the trustee, which I prepared myself at the 5 request of the bank and Stokes Kennedy Crowley. 6 42 Q. 7 Then you say that you were instructed to prepare another document? 8 A. 9 43 Q. 10 How do you mean another document. You were instructed to prepare a document to convert that trust? 11 A. 12 44 Q. 13 A. 14 45 Q. 15 I didn't say that. Sorry, would you just...(INTERJECTION)? Where did I say that? Did I say that? No, you didn't say it, I have used words which you didn't use? 16 A. 17 46 Q. Correct. But I was trying to note down some other aspects of 18 it when you were speaking and therefore I didn't 19 fully take on board what you were saying. 20 you would repeat what you said, please? 21 A. 22 23 At what stage? I don't understand what you are asking. 47 Q. You said you were given a copy of the Maureen 24 O'Brien Settlement documents in 25 1979...(INTERJECTION)? 26 A. 27 48 Q. 28 29 Perhaps Document, singular. Yes, and that you were asked to take some action respectively? 1 the trustees from K.C. Trust and the Governor of the 2 Company of the Bank of Ireland to the name of a new 3 trustee, Kenneth A. Lawless. 4 Stokes Kennedy Crowley and from the Bank of Ireland. 5 That request came in either 1978 or '79. 6 49 Q. 7 A. 8 50 Q. 9 The request came from Who is Mr. Kenneth A. Lawless? How do you mean who is he? I can't ask the question more clearly, is Mr. Lawless someone with whom you are familiar? 10 A. 11 51 Q. 12 A. 13 52 Q. 14 A. 15 53 Q. 16 A. Yes. Is he employed by S.K.C.? No. Do you know who he is employed by? At the moment I don't but he was...(INTERJECTION). Sorry, at that time? At that time he would have been working with 17 Mr. Shanley's companies. 18 companies other than Maybach but he was working with 19 the Shanley organisation. 20 54 Q. 21 Mr. Shanley would have So, Mr. Lawless became a trustee of the Maureen O'Brien Settlement? 22 A. 23 55 Q. Yes. Sole trustee. Returning to your statement, the Maureen O'Brien 24 Settlement, having been set up in 1970, you say that 25 "It advanced funds to a company called Keeladrum". 26 A. My understanding, that was the information I got 27 circa the end of '82/'83, when I went researching 28 exactly where the documentation was relating to the 29 various movements of trust funds or whatever. 1 2 A. 3 57 Q. 4 A. I don't know. Do you know if it was a incorporated entity? I presumed it was. I could be Keeladrum Limited or 5 it could be Keeladrum. 6 can recall. 7 58 Q. 8 Keeladrum is the only name I Was this, and you may not know this, was this an Irish company? 9 A. 10 59 Q. 11 A. 12 60 Q. 13 A. 14 61 Q. I don't know. So, Keeladrum was advanced some funds? Yes. Do you know was that by way of a loan? I don't know. But in any event, you understand that the funds were 15 repaid by Keeladrum to the Maureen O'Brien 16 Settlement ? 17 A. 18 62 Q. That was my understanding, yes. Circa 1980, at about the time that you were doing 19 the work in terms of changing the trustees to 20 include Mr. Lawless? 21 A. 22 Yes. I don't know whether it was around the time but it certainly was in the same year. 23 63 Q. 24 A. 25 64 Q. So, '7 9/'80. Yes. Do you know what the intention of the trustees was 26 in carrying out these two things in having Keeladrum 27 repay the loan and of changing the trustees. 28 was happening at that stage? 29 What 1 basic facts that the Maureen O'Brien Settlement had 2 an amount of funds, that those funds were entrusted 3 or given in some way to Keeladrum, again I would say 4 that this is information that I only gathered 5 second-hand that the arrangement whereby Maybach, 6 which we haven't mentioned yet, which is the company 7 which I was a director of, Maybach obtained the loan 8 from Guinness Mahon and it, according to your letter 9 and my information would have been secured by monies 10 lodged by Keeladrum with a bank, as I now 11 understand, in the Cayman Islands and that that loan 12 continued for two years and it would have been the 13 intention, 14 of Guinness Mahon. 15 65 Q. 16 17 I presume, to repay that loan to get rid Just going back, the Keeladrum funds were repaid to the Maureen O'Brien Settlement? A. That is roughly -- the Maureen O'Brien Settlement 18 owned the money and Keeladrum -- the intention, as I 19 understand it, was that the Maureen O'Brien 20 Settlement funds would be used to repay the loan. 21 So, therefore, the steps really that were envisaged 22 at the time were that there would be a repayment to 23 Maureen O'Brien, Maureen O'Brien would advance all 24 the paperwork to put that in place may not have been 25 dealt with, that is what I set out to research at 26 that time. 27 28 29 66 Q. You have mentioned on a number of occasions that you 1 67 Q 2 A 3 4 the College trustees people as well. 68 Q 5 6 A 69 Q A 70 Q That is a very big firm, I All right, a more precise question. Was he a partner in the firm at that time? A 15 16 I wouldn't have an idea. hardly know my own role in my own firm. 13 14 What was his role in S.K.C., do you know, at that time? 11 12 Sean Mooney, at that stage was the man that I would have been communicating in 1982/3 onwards. 9 10 Was there a particular person in S.K.C. with whom you dealt? 7 8 Mostly with Stokes Kennedy Crowley and I contacted I don't know. It was twenty years ago. I wouldn't have been interested really. 71 Q When the Maureen O'Brien Settlement recovered the 17 money from Keeladrum, you believe that that money 18 was resettled on the Katharina Trust. 19 A 20 72 Q 21 22 Yes . So, the money was transferred to the Katharina Trust ? A Well, in actual terms of bookkeeping or in 23 documentation at the time, I would have no proof but 24 that would have been the intention. 25 understand what happened. 26 why the Katharina Trust was set up. 27 This action was undertaken by the trustees of the 28 Maureen O'Brien Settlement? 29 Well, it happened, 17 That is as I That is, as I understand, I don't know who initiated it or 1 2 who actually carried it out but that did happen. 74 Q 3 Presumably someone gave an instruction to that effect? 4 A 5 75 Q 6 A Yes . Do you know who that might have been? I don't know. I couldn't really say who was 7 communicating at the time. 8 would have been the people acting for Michael 9 Shanley, they would have been the people acting Stokes Kennedy Crowley 10 for -- at least, around that time, what time would 11 that be, about 1977/'78. 12 would have been the people advising Mr. Shanley and 13 I would have thought -- the fact that I had to 14 research the thing in 1982, that Mr. Shanley himself 15 wasn't keeping much records, you know. 16 76 Q Stokes Kennedy Crowley Presumably the action of moving the funds from the 17 Maureen O'Brien Settlement to the Katharina Trust 18 was done on advice and your surmise is that perhaps 19 that was the advice of Stokes Kennedy Crowley. 20 A 21 22 It would be unfair of me to say that, I think Stokes Kennedy Crowley might answer that themselves. 77 Q All right. But someone was determining that this 23 should happen and I was really wondering whether 24 your research seemed to point to Stokes Kennedy 25 Crowley as being an influence on the decision to do 26 this ? 27 Well, I am telling you what I found out. 28 tell you the facts, if you want to attribute words 29 like influence and things, I couldn't speculate I can only 1 2 78 Q 3 4 been acting for Mr. Shanley? A 5 6 But Stokes Kennedy Crowley in any event would have Well, without them I wouldn't say Mr. Shanley wouldn't be up to speed on trusts. 79 Q I suppose ultimately it was Mr. Shanley's 7 instruction that this happened would that be 8 correct? 9 A 10 80 Q 11 A 12 81 Q 13 A 14 82 Q 15 16 I don't know. Do you have any documentation on Keeladrum? No. Do you know who its directors were? No. If we then go back again to the Katharina Trust, the Katharina Trust...(INTERJECTION)? A There is a link between Keeladrum in the -- there 17 may not be a link but in the Maureen O'Brien 18 Settlement there is mention of a company called 19 Drumkeelan, 20 derivative from that word, so, it may have had some 21 inspiration in the Maureen O'Brien Trust. 22 83 Q 23 24 I think that Keeladrum might be a Just for the sake of accuracy do you know how Drumkeelan is spelt? A I don't, no, but I presume it is 25 d-r-u-m-k-e-e-l-a-n, but I will be giving you a copy 26 of the actual documents. 27 28 29 84 Q Thank you. So, Drumkeelan, was that a company registered in Ireland? 1 85 Q. 2 from the Maureen O'Brien Settlement around 1980? 3 A. 4 86 Q. 5 A. 6 87 Q. 7 8 In any event the Katharina Trust received the funds Yes. It in turn advanced funds to Keeladrum? That is my understanding. Sorry, excuse me it didn't, it advanced funds to Maybach? A. 9 No. The initial advance, I think, was to Keeladrum, or at least one advance before Maybach came into the 10 picture, Maybach only came onto the scene, I think, 11 around January of '78 and I think Keeladrum would 12 have got that money from 13 trustees much earlier. 14 88 Q. 15 16 the Maureen O'Brien So, the Katharina Trust advanced some money, it in turn advanced the money to Keeladrum? A. The Katharina Trust came into existence in '77 and 17 the Katharina Trust got the money from the Maureen 18 O'Brien Settlement, which in turn presumably had got 19 it back from Keeladrum. 20 Maureen O'Brien Settlement, Keeladrum, back to the 21 bank, back to the Maureen O'Brien Settlement into 22 the Katharina Trust and a direct loan from the 23 Katharina Trust to Maybach. 24 sequence. 25 the way it went. 26 89 Q. 27 I think the sequence was, I think that is the As I understand it but that seems to be In essence Katharina advanced money at some stage to Maybach? 28 A. 29 90 Q. Yes. And you were acting, you or your firm were acting as 1 2 3 91 Q 4 A Did you advise on the setting up of Maybach? Well, people don't look for advice, they set up 5 companies or instruct somebody, I don't know whether 6 it was my firm or usually accountants procure the 7 company and we come into play when the company is 8 doing something in relation to property or doing 9 something in relation to something else that we are 10 instructed. 11 on the company records, the Memorandum of Articles 12 will show what is listed but I couldn't say that we 13 did it. 14 92 Q It may have been that we -- I would be I suppose what I was hoping to get to was what were 15 the objects of Maybach, in other words, what did it 16 set out to do as a company and what has it done? 17 A They are two separate questions. The objects would 18 be very very far ranging on a standard company but 19 what it was set up to do, I would think, was to 20 purchase some property and to collect rents from the 21 property, investment property, that would have been 22 it's initial objective, I would think. 23 93 Q 24 A 25 94 Q 26 A 27 28 29 That is what it subsequently went on to do? It did that, yes. What sorts of property did it acquire? It acquired investment property. Investment property, property that would be let on rents. 95 Q In the commercial field or in private property field? 1 2 96 Q 3 A 4 Houses ? Yes, houses. Maybe some as offices or mostly as apartments or flats. 5 97 Q 6 A 7 98 Q Did it own any land, farm land? It bought farmland subsequently, yes. You became a director you said, in the second page 8 of your statement 9 in 1978? 10 A 11 99 Q 12 13 Whatever date I said there, yes. What was the intention of the company in having you as a director? A (Exhibit 1), you became a director What was that enabling you to do? I would say convenience at the time. 14 think I enhanced the company. 15 directors at the time. 16 100 Q 17 A I wouldn't There were two You were a director here in Ireland? There were two directors when I was asked to become 18 a director, one was in England, Clive Redrup and Ken 19 Lawless was in Ireland and I presume that it would 20 have been for convenience of signing documents or 21 sealing documents or what ever. 22 23 24 25 26 27 28 29 101 Q Okay. Towards the bottom of the second page of your statement you say that (Exhibit 1): "During the greater part of my term as director of the company" (That is Maybach) "the company's auditors and tax advisers were Stokes Kennedy Crowley. I was happy to act as director of the company while that firm was dealing with the accountancy and tax affairs of the company." 1 I say it for the reason that I have been asked to 2 come before you and answer questions. 3 than Mr. Shanley's -- somebody that had come to 4 Dublin without the sort of status or roots that 5 Stokes Kennedy Crowley would have. 6 that the firm would have comforted me in a major way 7 because they would be experts and they would have 8 status and they would been doing everything right 9 obviously. 10 102 Q 11 So, I merely say Acceptable to the establishment. That is interesting because you said to us that you got to know Mr. Shanley in the late 60's? 12 A 13 103 Q 14 A That is my recollection, yes. And that you got to know him quite well? No, I didn't say that, I said I became friendly with 15 him. 16 would know nothing about. 17 I was no more 104 Q There would be aspects of Mr. Shanley that I In fact it was nearly ten years later, say the late 18 70's, that you became a director. 19 have established quite a decent professional 20 relationship with Mr. Shanley by that stage? 21 A 22 23 Yes, any client I have, I have a decent professional relationship with. 105 Q 24 25 Would you not Hence my question of you as to why you sought comfort from...(INTERJECTION)? A Because Mr. Shanley was not a tax expert and Mr. 26 Shanley was not a man who would know anything about 27 trusts. 28 know the people to trust, I think, but he wouldn't 29 be a person who would have any idea about setting up He would know the trust people and he would 1 trusts. 2 employed the best people, in his opinion, to do his 3 work and that probably set him aside from a lot of 4 other people in the building trade. 5 106 Q One aspect of Mr. Shanley was that he I think the context of my question though was really 6 set against the background of your role as a 7 director of Maybach. 8 A 9 107 Q Okay, yes. I could well understand, Mr. Smith, that having a 10 signatory, a director's signatory in Ireland was a 11 valuable feature, where the other director was 12 across the water? 13 A 14 108 Q Yes . But I just was intrigued by the way you linked the 15 two things together in terms of the comfort you got 16 from having Stokes Kennedy as the company's 17 accountancy and auditing firm? 18 A I don't know the point you are making. When you say 19 that I linked the two things together, what two 20 things are you talking about? 21 109 Q What I am getting at is, this comment of yours seems 22 to imply a concern of some sort? 23 No, it is not. 24 I, as a director of the company was comforted, 25 don't think I used that word in the statement, I am 26 using it now, by the fact that the people in charge 27 of the accounts of the company, it was my duty each 28 year as director to sign accounts and I wouldn't 29 likely do it and the fact that Stokes Kennedy It is merely to convey to you that I 1 Crowley were the accountants and that they presented 2 the accounts to me as a director, would have been a 3 fact that made me happy to be a director of the 4 company. 5 Because you believed that they would be conducting 6 all the right activities in terms of the preparation 7 of the accounts and signing them off as auditors and 8 so on? 9 A 10 Yes, I wasn't involved in the day to day operations of this company? 11 111 Q 12 A You weren't an executive, you were a non-executive? I was a non-executive director, so, I would 13 obviously not be very happy or not be happy to act 14 as director of the company if it's affairs were not 15 being properly conducted. 16 112 Q And of course you would have derived some comfort 17 from the fact that Stokes Kennedy Crowley had a 18 tremendous knowledge of Mr. Shanley's affairs and 19 activities and so on, of that sort? 20 A 21 113 Q 22 A 23 24 I was asking...(INTERJECTION)? You are merely confirming, yes, that is exactly what I said. 114 Q 25 26 You are saying that, yes. When Maybach was incorporated who was the person in S.K.C. who would have been involved as advisor? A I don't know. There were various names of people I 27 knew in there but it would be unfair of me to say 28 that any particular person -- I wasn't on a day to 29 day basis going to Stokes Kennedy Crowley, in fact 1 it was in retrospect that I would have gone to them 2 looking for information. 3 Maybach was put in place who the person directing 4 operations in there for Mr. Shanley was or for 5 Maybach or whoever I wouldn't like to say. 6 115 Q. 7 8 So, at the time that Presumably there was someone though who you would have telephoned if you had a query? A. 9 No, I would have been a very small player compared to Stokes Kennedy Crowley at that stage. 10 116 Q. 11 A. 12 117 Q. 13 A. 14 118 Q. 15 A. 16 119 Q. 17 A. But you were one of two directors of the company? Three, one of three directors. Who was the third one? Pardon? Who was the third one? Clive Redrup, Kenneth A. Lawless and myself. Messrs. Redrup and Lawless were outside Ireland? They were -- no, Kenneth Lawless in Dublin, and 18 Mr. Redrup was in the U.K. 19 on your question, when you say to me who was the 20 person in Stokes Kennedy Crowley that was dealing 21 with Maybach, was that the question? 22 120 Q. 23 A. I am just thinking back Yes? Well, there would be very little dealing with 24 Maybach at that particular time. 25 relation to the trust, there wouldn't be much 26 dealing with them but I can't really tell you who -­ 27 Sean Mooney was the man I dealt with in 1982, 28 whether Sean Mooney was the person dealing with us 29 in 1978, I just cannot really swear to it. Maybach, in 1 121 Q. Mr. Smith, we ordinarily stop for a cup of tea or 2 coffee and I think we are going to do that just now 3 for ten or fifteen minutes. 4 or coffee provided to you. 5 fifteen minutes. 6 A. Thank you. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 (SHORT RECESS) There will be some tea We will break for ten or 1 2 MR. JUSTICE COSTELLO: 3 Mr. Rowan. 4 M R . ROWAN: Mr. Smith, I don't have 5 any further questions, 6 thank you. 7 minor points 8 MR. SMITH: Fine, okay. 9 MS. MACKEY: I wanted to ask you, Ms. Mackey just wants to pick up a few 10 Mr. Smith, a question, 11 first of all about Keeladrum. 12 talking to Mr. Rowan there you said that in the 13 research that you had done into this matter in 14 1982/'83, you came across information relating to 15 the funds deposited by Keeladrum in what now appears 16 to be Ansbacher? 17 A. 18 122 Q. 19 A. I think when you were I don't think I said that. Did I understand you correctly? No, I don't think I said that I came across 20 information about the funds, I came across 21 information that Keeladrum...(INTERJECTION). 22 123 Q. 23 A. 24 124 Q. 25 A. 27 125 Q. 29 I was told, yes, by Sean Mooney. You were told this. This is what I was going to ask you, where did you find this information? 26 28 Indicating that this had happened? Sean Mooney in Stokes Kennedy Crowley. Told you that Keeladrum had deposited funds with Ansbacher? 1 2 126 Q 3 A Yes . There would have been also an indication that that 4 money was used for a back to back loan that Maybach 5 obtained from Guinness Mahon. 6 127 Q 7 A 8 128 Q 9 Where would that indication have come from? From Sean Mooney, he just told me. He told you that that money was used for a back to back loan? 10 A 11 129 Q 12 A Yes . Did he tell you where the money was? At the time, no, he wouldn't have said it. 13 Certainly, even at this point in time I don't know 14 where the money -- no, I didn't. 15 130 Q 16 A Well I thought? I presume that the money was on back to back and 17 that it was with a company or a bank or whatever it 18 was in the Cayman Islands. 19 131 Q 20 A 21 22 You told me in a letter anyway since this thing started that that was what happened. 132 Q 23 24 Why do you presume that? Apart from what we told you in the letter you don't have any other information on that? A It is very difficult, you are asking me what people 25 said twenty years ago in 1982, at the end of '82 26 Mr. Shanley would have asked me to find out or look 27 into the question of the trusts and how the thing 28 was dealt with and as a result of that I would have 29 contacted Stokes Kennedy Crowley and discussed the 1 2 indication that that's what happened at Keeladrum 3 but for me to say on sworn evidence that Sean Mooney 4 told me that the money was put in any particular 5 bank or any particular place, I think what would 6 have been said at the time was that it was used on a 7 back to back arrangement. 8 133 Q 9 Yes, I see. I am just looking at our letter (Exhibit 2) to you, we didn't mention that fact, we 10 asked you whether any person associated with Maybach 11 or with the loan from Guinness and Mahon had 12 deposited funds in the Cayman Islands, either with 13 Guinness Mahon Cayman Trust or otherwise and in 14 answer to that question you said (Exhibit 1): 15 "I have no documentation relating to any funds deposited in the Cayman Islands either with Guinness Mahon Cayman Trust or otherwise. My understanding is that the Trust known as the Maureen O'Brien Settlement (MOB Settlement) which was a trust established in Ireland in 1970, advanced trust funds to a company called Keeladrum" 16 17 18 19 20 21 A 22 134 Q Yes . Now you give us that in answer to our question 23 whether anyone connected with Maybach had deposited 24 money in the Cayman Islands? 25 A 26 135 Q Yes . I understood your evidence earlier this morning to 27 be that, in fact I understood that you specifically 28 said at some point but the transcript will clarify 29 that later that Keeladrum, that the 1 M. O'Brien Trust had advanced funds to Keeladrum 2 which they placed on deposit with Cayman and which 3 were used as a back to back? 4 Yes, well for me to distinguish between what my 5 presumptions are and what I was exactly told. 6 aware that you people are investigating a bank and 7 that I am here to give you evidence and that that 8 bank presumably was in the Cayman Islands because 9 that is the name of it, is a bit difficult for me I am 10 especially when I am asked questions about third 11 parties. 12 cross examining me on what I did I would be quite 13 happy but when you are cross examining me about what 14 other people told me, about what other people did, 15 it's getting far removed from my factual 16 information. 17 136 Q If you were asking about what I did and Could you put it another way? You were going to 18 provide us with the trust deed from the Maureen 19 O'Brien Settlement and are you going to provide us 20 with other documentation relating to that trust? 21 A 22 137 Q 23 24 I have the change of trustee. Do you have documentation indicating the loan to Keeladrum? A 25 I would have a letter on file from Stokes Kennedy Crowley which would have outlined the position. 26 138 Q 27 A 28 139 Q 29 A Would you be able to provide us with that? If you direct me to do so, yes. Does that refer to Keeladrum? Well I have a letter that I wrote to Stokes Kennedy 31 1 2 140 Q 3 A 4 141 Q 5 A Yes . And I have a reply from them. Did they reply specifically to Keeladrum? There is reference to Keeladrum at some stage, now 6 whether it was in a conversation or in the letter, I 7 would have to go and get the letter. 8 142 Q Well, if you would provide us with that 9 correspondence, any correspondence you have relating 10 to the loan, funds advanced from the Maureen O'Brien 11 Trust to Keeladrum and any possible use that 12 Keeladrum made of that? 13 A My correspondence would be merely general 14 information with reference to these people, it 15 wouldn't be correspondence specifically relating to 16 the loan, at no stage did I get or ask for the 17 documentation relating to the loan but if you direct 18 me to give you the letter I wrote and the letter 19 that I got back. 20 143 Q 21 A 22 144 Q Please yes? That is no problem. If those letters refer and we will see whether they 23 do or not, to Keeladrum, presumably they will 24 indicate what Keeladrum is? 25 A was a person. 26 27 No, it is just a reference to it, the same as if it 145 Q In relation to the Katharina Trust, we haven't asked 28 you to provide us with that trust deed, can you 29 provide us with that? 1 2 146 Q Will you also provide us with any other 3 documentation relating to the Katharina Trust which 4 you have? 5 A 6 I think there is a change of trustee from Sovereign to...(INTERJECTION). 7 147 Q 8 A 9 148 Q 10 A 11 149 Q 12 A College? Yes . Do you have a letter of wishes? Pardon? Do you have a letter of wishes? I would have copies, I wouldn't have myself been 13 directly involved but I would have got copies from 14 the client looking for advice and again on legal 15 professional privilege whatever it says under the 16 section of the act, I probably would need your 17 direction on that. 18 150 Q 19 A Yes . I am aware there is an important case, an important 20 decision of Judge Peter Kelly, pending from the High 21 Court on that very point at the moment. 22 your inspectorate may be on a different basis but my 23 concern obviously it is not privileged in relation 24 to myself because I know I don't have any but it is 25 in relation to the client that if they seek as 26 advice from me on matters, am I entitled to 27 disclose? 28 connection? 29 having been in the profession for forty years if I I know that Is there any confidentiality in this I would be a little bit shattered 1 2 151 Q 3 Yes, I t h i n k w e w o u l d r e q u i r e you, A 5 152 Q W i t h t h e t r u s t d e e d of t h e K a t h a r i n a T r u s t . l e t t e r of wishes. 7 Katharina Trust? A 9 Yes. O k a y. Is it in o r d e r i f I w r i t e t o t h e c o m p a n y a n d to Mr. Shanley and say that I have been d i r e c t e d to h a n d it over, 11 w o u l d they please contact you? 153 Q 13 Yes, if t h e y h a v e a n y o b j e c t i o n b u t t h a t y o u w i l l h a n d it o v e r a n y w a y , t o us, you won't wait? A Well, I mean, t h e i r p r i v i l e g e is g o n e if I h a n d it 15 to you be f o r e gi v i n g t h e m an opportunity. 16 surmising, 17 or anything. 18 required. 19 The Your e n t i r e files on the 10 14 to With? 6 12 Sm i t h , p r o v i d e us w i t h tho s e ? 4 8 Mr. 154 Q I am only no c o n t e n t i o n b e t w e e n me a nd y o u r s e lv e s I a m q u i t e h a p p y to d o w h a t e v e r is I am not sure what p r i v i l e g e you are ass e r t i n g 20 Mr. 21 I am not asserting anything but I am a conduit pipe 22 h e r e g i v i n g i n f o r m a t i o n to y o u w h i c h I g o t f r o m 23 clients, 24 ye a r s , 25 a n o p e n b o o k f o r a l l m y c l i e n t s i n f o r m a t i o n b u t if 26 t h a t is t h e w a y it is, 27 changing slightly 28 29 Smith? b e i n g in t h e p r o f e s s i o n f o r a l m o s t f o r t y it w o u l d c o m e as a g r e a t s h o c k t o m e if I a m . so b e it. T h e w o r l d is 1 Mr. 2 g o i n g t o b e in t o u c h w i t h Mr. 3 MR. 4 155 Q 5 Smith. SMITH: A 7 156 Q 8 Shanley. Yes. W e a r e g o i n g to a s k him, privilege, 6 As you p r o b a b l y will a p p r e c i a t e we are i f t h e r e is a n y l e g a l w o u l d h e w a i v e it. Yes . If he d o e s n ' t w a i v e it w e w i l l t h e n h a v e t o c o n s i d e r the position. 9 A 10 157 Q T h a t w o u l d b e h e l p f u l t o me, yes. I w o u l d j u s t l i k e y o u t o k n o w t h a t t h a t it is g o i n g 11 to h a p p e n . 12 h a v e c o r r e s p o n d e d o n b e h a l f o f Mr. 13 K a t h a r i n a Trust, 14 A 15 158 Q I u n d e r s t a n d t h e p o s i t i o n is t h a t y o u S h a n l e y w i t h the is t h a t it? Yes . So, this isn't documents that came into your 16 p o s s e s s i o n s o m e h o w later. 17 y o u r f i l e s r e l a t i n g to t h e K a t h a r i n a T r u s t on b e h a l f 18 of y o u r c l i e n t Mr. 19 A 20 T h e s e a r e d o c u m e n t s on Shanley, is t h a t it? T h e y c a m e i n t o m y p o s s e s s i o n w h e n Mr. Shanley sought m y a d v i c e c o n c e r n i n g t h e t r u s t t h a t h a d b e e n s e t up. 21 159 Q 22 A 23 160 Q I see. T h e y w e r e n ' t o n m y file. I m i s u n d e r s t o o d y o u b u t as I u n d e r s t a n d it t h e n 24 t h e r e w a s c o r r e s p o n d e n c e i n e x i s t e n c e r e l a t i n g to 25 the e s t a b l i s h m e n t of the K a t h a r i n a Trust w h i c h 26 Mr. 27 you? 28 No, 29 e n d of 1982, S h a n l e y g a v e you, y o u r c l i e n t Mr. Shanley gave w h a t h a p p e n e d was that in Nove m b e r , Mr. a r o u n d the Shanley would have approached me 1 and sought m y advice c o n c e r n i n g the Trust and his 2 p o s i t i o n or the p o s i t i o n of M a y b a c h a n d the p o s i t i o n 3 of h i m s e l f in r e l a t i o n t o t h e s e t r u s t s a n d t h a t 4 w o u l d hav e, as a r e s u l t o r in o r d e r t o a d v i s e h i m on 5 the matter, I would have sought more information and 6 m y file w o u l d consist m a i n l y of that information. 7 J u s t t o v e r i f y tha t, 8 c o r r e s p o n d e n c e w h e n S t o k e s K e n n e d y C r o w l e y w r o t e to 9 m e a s k i n g m e to c h a n g e t h e t r u s t e e s of M a u r e e n before I 1982 t h e r e d i d exist 10 O'Brien Settlement, 11 c o r r e s p o n d e n c e r e l a t i v e to e i t h e r t r u s t , 12 r e c o l l e c t i o n j u s t at t h e m o m e n t t h a t I w o u l d h a v e 13 had. 14 c a r r i e d o u t in o r d e r t o a d v i s e Mr. 15 p o s i t i o n and the p o s i t i o n of Maybach. 16 161 Q. that w ould have been the only from my M y file w o u l d h a v e c o n s i s t e d t h e n of r e s e a r c h S h a n l e y of h i s Just leave aside for the m o m e n t the c o r r e s p o n d e n c e 17 of S t o k e s K e n n e d y C r o w l e y , 18 t h a t a n d y o u a r e g o i n g to g i v e u s . . . ( I N T E R J E C T I O N ) ? y o u a r e g o i n g t o g i v e us 19 A. Yes, t h a t is v e r y l i t t l e . 20 162 Q. What I a m c o n c e r n e d a b o u t is, in r e l a t i o n t o t h e 21 e v i d e n c e that you have given, 22 t h a t yo u h a v e a c o p y of the K a t h a r i n a T r u s t or that 23 yo u h a v e a c o p y of the l e t t e r s of w i s h e s in r e l a t i o n 24 to the K a t h a r i n a Trust? 25 A. w h i c h is t o t h e e f f e c t In r e l a t i o n to t h e l e t t e r o f w i s h e s I would have 26 c o p i e s o f w h a t m y c l i e n t w o u l d h a v e s e n t t o m e fo r 27 advice but 28 the l e t t e r s of w i s h e s that w e r e d e l i v e r e d . 29 I cannot say here that t h e y are a c t u a l l y 1 l e t t e r of w i s h e s w o u l d c o m m u n i c a t e d i r e c t l y w i t h the 2 trustees. 3 163 Q 4 5 Yes, but you h ave d o c u m en t s r e l a t i n g to the letters of w i s h e s A connected with the trust? I w o u l d h a v e a c o p y of a l e t t e r o f w i s h e s g i v e n b y 6 Mau r e e n O'Brien Initially, I would think and a copy 7 of h e r i n s t r u c t i o n to K.C. Trust and the Governor 8 and the C o m p a n y of the B a n k of I r e l a n d to change the 9 trustee. 10 164 Q 11 A 12 165 Q 13 A Yes . I w o u l d h a v e t h o s e in r e l a t i o n to M a u r e e n O'Brien. Yes . In r e l a t i o n to t h e K a t h a r i n a T r u s t , I would have 14 c o p y of t r u s t d o c u m e n t a n d I w o u l d h a v e a p a r t i a l 15 c o p y of t h e d o c u m e n t c h a n g i n g t h e t r u s t e e s 16 S o v e r e i g n to C o l l e g e . 17 did ask College trustees 18 p a g e b u t I d i d n ' t e v e r g e t It b u t I d o n ' t t h i n k it 19 is a v e r y i m p o r t a n t d o c u m e n t , t h e r e is e n o u g h in it 20 to i n d icate what the d o c ument is, 21 c h a n g e of t rustees. 22 166 Q 23 A T h e f r o n t p a g e is m i s s i n g , I w o u l d h a v e g o t that, the Katharina, 25 t r u stees or m a y b e 27 A I think I maybe f rom the from Stokes Kennedy Crowley. W h e n was that? I w o u l d h a v e b e e n a r o u n d the e n d of '82, when I started my investigation. 28 29 it is m e r e l y a H o w d i d yo u get that d o c u m e n t ? w o u l d have got w h a t e v e r documents, 167 Q I for a c o p y of the front 24 26 from 168 Q W h e n y o u s t a r t e d t h e i n v e s t i g a t i o n y o u g o t c o p i e s of 37 1 2 3 Yes . 169 Q 4 those documents? 5 A 6 170 Q 7 8 W e a r e r e q u i r i n g y o u n o w to g i v e us t h e c o p i e s o f Yes . What I a l s o w a n t e d to c l a r i f y is t h a t y o u d i d m e n t i o n letters of wishes? A 9 Y o u m e n t i o n e d it o r s o m e b o d y m e n t i o n e d it b e f o r e m e n t i o n e d it, I m e r e l y answered. I a m n o t s o r t of 10 comfortable with the question because 11 t h a t i n t h e c a s e of t h e l e t t e r of w i s h e s t h a t t h e 12 only letters I got, 13 day letters, the Maureen O'Brien letters 14 p r o b l e m w i t h but the one I got from 15 Mr. 16 advice...(INTERJECTION). 17 171 Q 18 19 I I w o u l d feel I am talking now about latter I h a v e no Shanley would have been seeking T h a t is w h a t I w a n t t o g e t at i n e n q u i r i e s f r o m you. W h a t p e r i o d are you t a l k i n g about? A 20 I w o u l d b e t a l k i n g a b o u t -- t h a t w o u l d h a v e b e e n - ­ p r o b a b l y in the late 21 172 Q 22 A 23 173 Q 24 A In t h e l a t e Or '8 0's o r '90's . ' 8 0 's ? '90 ' s . Or e a r l y Well, '90's ? it w o u l d b e i n t h e ' 9 0 's. There has been 25 s p o r a d i c c o r r e s p o n d e n c e a b o u t th i s . There was 26 a n d t h e r e w a s a t h r e e - y e a r g a p the n, about 1985/6 27 a n d t h e n it d e p e n d e d o n w h e n I w a s -- it w a s n ' t 28 p r a y i n g on m y mind. 29 I j u s t w a n t to g e t c l a r i f i e d , 38 at t h i s st a g e , 1 98 2 you 1 2 A. I w a s c a r r y i n g o u t i n q u i r i e s t h a t he r e q u e s t e d m e to 3 c a r r y out. 4 c a p a c i t y he w a s i n s t r u c t i n g m e . . . ( I N T E R J E C T I O N ) . 5 175 Q. 6 A. 7 17 6 Q. 8 A. 9 177 Q. 10 in what Shanley was your client? A n d M a y b a c h was m y client. And Maybach? Yes. O n b e h a l f o f e i t h e r M a y b a c h o r Mr. S h a n l e y you c a r r i e d out c o r r e s p o n d e n c e ? 11 A. 12 178 Q. 13 Correct. I n r e l a t i o n to t h e l e t t e r o f w i s h e s , Mr. 14 A. 15 17 9 Q. 16 17 Mr. W h o he w a s a c t i n g f o r o r why, S h a n l e y and w i t h the trustees, both with d i d you? Yes. A n d i t ' s t h a t c o r r e s p o n d e n c e t h a t w e r e q u e s t y o u to give us? A. That w o u l d be p a r t i c u l a r correspondence, I d o n't see 18 a n y t h i n g u n t o w a r d i n it b u t it is t h a t p a r t i c u l a r 19 correspondence, 20 advice, 21 p r o p e r t y and things that 22 180 Q. 23 A. 24 I w o u l d c e r t a i n l y say, as I r e c a l l , arose from that they were m a tters about I a d v i s e d c o u l d n ' t b e do n e . Yes? I d o n ' t s e e t h a t Mr. Shanley will have any objections. 25 181 Q. 26 A. 27 182 Q. Y o u c a n f i n d o u t f r o m h i m if t h e r e is a n y o b j e c t i o n . Yes. J u s t so t h a t w e u n d e r s t a n d w h a t t h e p o s i t i o n is, 28 Ms. 29 a n d y o u h a v e i n d i c a t e d t o us, Mack e y was asking you about the Katharina Trust did you have any other 1 2 3 M y f i l e t h a t is o p e n t h a t 4 it's ob v i o u s l y ex t r a c t e d some corresp o n d e n c e 5 e a r l i e r c o m m u n i c a t i o n s a n d in f a c t a r o u n d 1 9 8 5 o r 6 1986, 7 t h e y w e r e c a l l e d at t h e time , 8 m e s e n d i n g m e c o p i e s of t h e t w o l e t t e r s o f 9 183 Q 10 A 11 184 Q 12 A 14 185 Q Stokes K e n n e d y C r o w l e y or K.P.M. from or w h a t e v e r w o u l d h a v e w r i t t e n to '82. These are on y our files? Yes . In 1 9 9 2 ? T h e f i l e is d a t e d from 13 I h a v e is d a t e d 1 9 9 3 b u t '93 b u t it h a s c o r r e s p o n d e n c e b a c k '82. We w o u l d re q u i r e copies of that file a nd you can 15 f i r s t of a l l h a v e a w o r d w i t h y o u r c l i e n t a b o u t 16 them. 17 A 18 Yes . MS. MACKEY: T h a t is c l a r i f i e d a n d t h a t 19 is h e l p f u l , 20 Mr. 21 to the K a t h a r i n a Trust? 22 MR. 23 186 Q Smith. In r e l a t i o n to t h e t r a n s f e r of t h e f u n d s SMITH: Yes. Was that a total t r a n s f e r of the funds in the 24 Maureen O'Brien Settlement, 25 terminated? 26 A 27 187 Q 28 A 29 thank you was that then I t h i n k it j u s t w e n t i n t o d r y dock . B u t it w a s e m p t i e d o u t ? E m p t i e d out, yes, w a s e m p t i e d out, as I u n d e r s t a n d t h e p o s i t i o n it yes. 1 188 Q Do y o u k n o w o r c a n y o u t e l l u s w h a t t h e K a t h a r i n a 2 T r u s t d i d w i t h t h o s e fu nd s, 3 w h e r e it d e p o s i t e d t h e m ? w h e r e it p l a c e d them, 4 A 5 189 Q 6 A To, t-o, 7 190 Q So, Maybach had the Katharina Trust funds? 8 A 9 It j u s t l e n t t h e m d i r e c t l y to M a y b a c h . Through Maybach? t h e y w o u l d be in M a y b a c h ' s May b a c h o b tained the Katharina m y s e l f tha t, accounts. funds and I think m y r e c o l l e c t i o n is t h a t t h e K a t h a r i n a 10 T r u s t w o u l d b e n a m e d as t h e l e n d e r i n t h e a c c o u n t s 11 of t h e c o m p a n y . 12 Revenue Commissioners. 13 191 Q 14 15 W e w o u l d a l s o t h e n a s k y o u t o p r o v i d e us w i t h the M a y b a c h a c counts? A 16 I can't because I am not a director. You would have to ask M a y b a c h themselves. 17 192 Q 18 A 19 193 Q 20 A 21 194 Q 22 23 Yes. The a c c o u n t s are m a d e out to the You are no longer a director. No. Do y o u h a v e c o p i e s of a n y o f t h e a c c o u n t s ? No. Do y o u k n o w w h e r e M a y b a c h d e p o s i t s t h e K a t h a r i n a Trust funds? A 24 No, I w ould have thought they w ould use them rather t h a n d e p o s i t the m. 25 195 Q 26 A It d o e s n ' t i n v e s t t h e m at a l l ? It w o u l d i n v e s t t h e m in p r o p e r t y o r w h a t e v e r . 27 or i ginal loan w o u l d have b e e n u s e d to p u r c h a s e 28 property. 29 196 Q I see. The 1 2 197 Q 3 In t h e e v e n t o f a d d i t i o n s to t h e K a t h a r i n a T r u s t f u n d w h a t h a p p e n s to t h o s e a d d i t i o n s ? 4 A 5 198 Q 6 A 7 199 Q 8 A 9 In a d d i t i o n to ? W h e r e a d d i t i o n s a r e m a d e to t h e o r i g i n a l Not to m y knowledge, settlement? no. N o a d d i t i o n s ... ( I N T E R J E C T I O N ) ? No t to m y k n o w l e d g e a n y w a y w h a t e v e r p a s s e d on f r o m t h e M a u r e e n O ' B r i e n S e t t l e m e n t ag a i n , my 10 u n d e r s t a n d i n g is t h a t w h a t e v e r w a s p a s s e d o n t o t h e 11 M a u r e e n O ' B r i e n t r u s t e e s to the K a t h a r i n a t r u s t e e s 12 w o u l d h a v e b e e n t h e e n t i r e o f t h e fund. 13 20 0 Q So, y o u r u n d e r s t a n d i n g the n, if I h a v e i f c o r r e c t l y , 14 of w h a t has happened, 15 t h e M. O ' B r i e n t r u s t w e n t t o K e e l a d r u m b y w a y o f a 16 loan? 17 A 18 19 I didn't say, is t h a t t h e f u n d s t h a t w e r e in I a m as s h o r t as y o u r s e l v e s on information about Keeladrum. 20 1 Q W e n t t o K e e l a d r u m w h o a p p e a r s t o h a v e p l a c e d it o n 20 d e p o s i t in C a y m a n fo r t h e p u r p o s e of t h i s b a c k to 21 back l o a n . .. (INTERJECTION)? 22 A 23 202 Q 24 25 W h i c h M a y b a c h got, then those funds were repaid by K e e l a d r u m to t h e M a u r e e n O ' B r i e n T r u s t . A O r t h e M a u r e e n O ' B r i e n T r u s t d i r e c t e d K e e l a d r u m to p a s s . . . (INTERJECTION). 26 27 Correct. 20 3 Q It c a m e b a c k , in a n y ev e n t , to t h e M a u r e e n O ' B r i e n 28 Trust, 29 w h i c h was c o n s t i t u t e d for that p u r p o s e ? who then sett l e d t h e m on the K a t h a r i n a Trust 1 2 204 Q 3 T h e K a t h a r i n a T r u s t then , Channel 4 A 5 20 5 Q 6 A 7 206 Q 8 Islands? Correct. T r a n s f e r r e d b y w a y of l o a n ? Yes . A l l of i t ' s f u n d s to M a y b a c h w h i c h is a n I r i s h company? 9 A 10 207 Q 11 A W h i c h is a c o m p a n y w h i c h it o w n e d . Here in Ireland? It w a s e n t i t l e d t h r o u g h t h e e n t i r e i s s u e d s h a r e 12 c a p i ta l of Maybach, 13 company. 14 208 Q the 16 here , A 18 so it w a s l e n d i n g t o its It w a s l e n d i n g t o its c o m p a n y , 15 17 so e f f e c t i v e l y a l l f u n d s t h a t w e n t o u t to t h e C h a n n e l Islands are is t h a t c o r r e c t ? They m a y have be e n repaid. They may have been r e p a i d in r e c e n t years. 19 209 Q To t h e t r u s t ? 20 A To t h e t r u s t . 21 21 0 Q This is w h a t I w a s g e t t i n g at o r i g i n a l l y , 22 w e r e r e p a i d to t h e t r u s t , 23 them? 24 A 25 21 1 Q 26 A Oh, I don't You don't know, w h a t d i d t h e t r u s t do w i t h I w o u l d h a v e n o idea . I w o u l d h a v e a c t e d f o r M a y b a c h w h e n it s o l d a s s e t s in t h e l a s t 28 D u b l i n to M a y b a c h . 212 Q if t h e y know whether the trust i n vested them? 27 29 w h i c h w a s a t r u s t in t h e Yes . f e w y e a r s a n d t h e m o n e y w a s p a i d in 1 M y u n d e r s t a n d i n g is t h a t M a y b a c h r e p a i d t h e l o a n b u t 2 a g a i n you w o u l d h a v e to g e t . . . ( I N T E R J E C T I O N ) . 3 21 3 Q 4 A 5 214 Q 6 A R e p a i d t h e l o a n to t h e t r u s t ? T h a t is m y u n d e r s t a n d i n g . Have you any idea when that occurred? It w o u l d b e w i t h i n t h e p a s t t w o y e a r s , 7 think. 8 else, 9 Mr. 10 11 Now, I would I mean they may have sold something I don't Shanley's k n o w if a n y b o d y e l s e -- I d o n ' t do l egal w o r k in the m a i n in I r e l a n d an y m o r e b u t I do s t i l l ac t f o r M a y b a c h . 21 5 Q Right. So, if M a y b a c h r e c e i v e d t h i s l o a n f r o m t h e 12 K a t h a r i n a T r u s t in o r d e r to t r a d e a n d h a s 13 s u b s e q u e n t l y r e p a i d it, 14 e n t i t y in it's ow n s i t u a t i o n ? 15 A 16 216 Q 17 A 18 is M a y b a c h n o w a v i a b l e O b v i o u s l y it h a s g r o w n up, yes. Does i t . . . ( I N T E R J E C T I O N ) ? It w o u l d b e d o i n g v e r y b a d a f t e r t w e n t y y e a r s if it c o u l d n ' t r e p a y a loan. 19 217 Q 20 A 21 218 Q 22 A 23 219 Q 24 A D o e s it p u t it s p r o f i t s b a c k t o K a t h a r i n a ? I d o n ' t know. You don't know. I d o n ' t k n o w w h e t h e r it h a s a n y p r o f i t s . You don't k n o w w h e t h e r it h a s p r o f i t s ? It m a y not, if i t ' s a p r o p e r t y c o m p a n y , an 25 investment 26 e x a c t l y w h a t -- I h a v e n ' t b e e n a d i r e c t o r f o r t e n 27 y ears or t w e l v e years, 28 29 company with borrowers, so, I don't know I don't know exactly. 1 It c o l l e c t s t h e r e f o r e t h e r e n t s f r o m t h e s e 2 properties. 3 y o u know, 4 development property. 5 A 6 7 222 Q at t h e m o m e n t , as f a r as a c t i v e l y i n v e s t in p u r c h a s e p r o p e r t y a n d W e l l it s o l d t h e m a i n i n v e s t m e n t p r o p e r t i e s it m a y h a v e r e t a i n e d some, 8 Yes. it had, it s t i l l h a s t h e farm. A n d it i s n ' t at t h e m o m e n t e n g a g e d i n p u r c h a s i n g or d e v e l o p m e n t ? 9 A 10 22 3 Q It c o u l d be, Guinness 12 that? A I d o n ' t know. In r e l a t i o n to t h e l o a n t h a t M a y b a c h g o t f r o m 11 13 D o e s it st il l, and Mahon, I can't. c a n y o u t e l l us a n y t h i n g a b o u t I w a s t o l d i n y o u r l e t t e r t h a t w e w e r e on 14 record, 15 time w e r e on r e c o r d an d I h a v e a r e c o l l e c t i o n of 16 b e i n g in G u i nn e s s M ah o n ' s p r e m i s e s 17 two occasions, 18 that p a r t i c u l a r b u s i n e s s or not I d on't k now but 19 d o n ' t h a v e a n y f i l e o n it, 20 office, 21 w e w e r e a c t i n g as s o l i c i t o r I a m s u r e w e h a d 22 something, 23 v e r y l i t t l e if t h e y w e r e just g e t t i n g a l o a n on a 24 b a c k to b a c k b a s i s . 25 c h a r g e o n t h e a s s e t s of M a y b a c h at t h e t i m e . 26 w a s n o m o r t g a g e o r a n y t h i n g to b e don e , 27 know what 28 C a n y o u t e l l us a n y t h i n g a b o u t h o w t h e b a c k t o b a c k 29 security arrangement arose? S m i t h F o y o f T. K. S m i t h F o y a n d Co., at t h e o n at l e a s t m a y b e w h e t h e r it w a s i n c o n n e c t i o n w i t h I I have l o o k e d in the t h e r e w a s n o f i l e o n it at t h e t i m e b u t if s o m e r e c o r d s o r w h a t e v e r b u t it w o u l d b e I w o u l d t h i n k t h a t t h e r e w a s no so, There I don't f u n c t i o n we m i g h t h a v e p l a y e d . 1 2 22 5 Q 3 A Y o u can't. No. It l a s t e d f o r a b o u t t w o y e a r s t o m y k n o w l e d g e 4 o n M a y b a c h a n d I c o u l d n ' t h a v e s e e n it o f g r e a t 5 b e nefit really, 6 226 Q 7 8 A 227 Q 11 A 12 228 Q 13 A 14 229 Q 16 A 17 W h e r e do you find that i n f o r mation? I t h i n k I g a v e it t o y o u i n m y l e t t e r . Yes, b u t . . . (INTERJECTION)? I w o u l d h a v e g o t t h a t in m y i n q u i r i e s b u t I w o u l d s i n c e y o u w r o t e t o me. From whom would you have made those inquiries? I w o u l d h a v e s p o k e n t o Pa t G u i n a n , I would have s p o k e n to S e a n Mooney. 23 0 Q Right. W o u l d Sean M o o n e y h ave b e e n able to give you i n f o r m a t i o n on that loan? 19 A 21 No, apart from what I h a d i n m y file, I d i d n ' t get a n y m o r e i n f o r m a t i o n f r o m him. 23 1 Q 23 24 it w a s r e p a i d in 1 9 8 0 a n d it w a s g o t in 19 78 have made inquires 15 22 Well, so. 10 20 W h e r e d o y o u ge t t h e i n f o r m a t i o n t h a t it l a s t e d for two years. 9 18 Right. y o u know. Right. I am just w o n d e r i n g w here the information.. . (INTERJECTION)? A Well, I t h o u g h t h e m i g h t h a v e files, when I 25 contacted h im I thought that they m a y have had their 26 f i l e o n it. 27 232 Q 28 29 But w here did the i n f o r m a t i o n come from that the l o a n b e g a n in A '78 a n d e n d e d in '80? W h e r e d i d t h a t i n f o r m a t i o n c o m e from . 46 I suppose any 1 in f o r m a t i o n I got re a l l y ei t h e r came from Stokes 2 K e n n e d y C r o w l e y or the c o m p a n y itself, 3 T h e r e w o u l d b e n o o t h e r s o u r c e o f i n f o r m a t i o n t o me. 4 23 3 Q 5 Just to m o v e onto a s l i g h t l y d i f f e r e n t matter. 6 A 7 234 Q 8 9 I see. Maybach. C a n y o u t e l l us a b o u t P r o v a n L i m i t e d ? Ve r y little. Well, w h a t c a n y o u t e l l us. Is t h i s a n I r i s h company? A I t h i n k it is a m a j o r e n o u g h b u i l d i n g c o m p a n y at t h e 10 moment. 11 is b u i l d i n g h o u s e s or o p e r a t i n g i n C o r k s u c c e s s f u l l y 12 b u t I d o n ' t act for the company. 13 23 5 Q 14 A 15 236 Q 16 A 18 237 Q 19 A f r o m h e a r s a y again, I t h i n k it A r e yo u or h a v e you e v e r b e e n a d i r e c t o r of P r o v a n ? No. D o y o u k n o w if t h i s is a c o m p a n y b e l o n g i n g to Mr. 17 It w o u l d be, Michael Shanley? I d o n ' t know. You don't know? W h e n I say I don't know I m e a n I don't know who the 20 d i r e c t o r s o r t h e b e n e f i c i a l o w n e r s of t h e c o m p a n y 21 are. 22 238 Q 23 A 24 It h a s t h e s a m e a d d r e s s as M a y b a c h ? Yes. It w o u l d b e a c o m p a n y w i t h w h i c h h e h a d a n interest 25 239 Q 26 A I presume but a g a i n . . . (INTERJECTION). But of y o u r k n o w l e d g e ? I k n o w t h a t it is P r o v a n , m a y b e we d i d act for the m 27 in some small t h i ng but we h a v e n ' t b e e n acting, 28 say, 29 24 0 Q f o r Mr. I see? Shanley's companies. as I 1 And I might 2 m a i n o p e r a t i o n in I r e l a n d , 3 w o u l d h a v e b e e n set a s i d e f o r h i s c h i l d r e n a n d he 4 w o u l d h a v e s h o w n a v e r y k e e n i n t e r e s t i n it b e c a u s e 5 he is i n t e r e s t e d in h i s c h i l d r e n . 6 t h a t t h a t is w h a t h a p p e n e d . 7 24 1 Q 8 A 10 242 Q 11 A 12 24 3 Q 13 A 14 I think myself m-o-n-t-o-i-r-e? I n e v e r h e a r d of it b e f o r e . Y o u n e v e r h e a r d of it? No, t hey are g e t t i n g fancier obviously. Yes . P r o v a n w e m a y h a v e f o r m e d as w el l , 244 Q I h a v e no f u r t h e r q u e stions, MR. JUSTICE COSTELLO: 17 it m a y h a v e S m i t h Mr. Mr. Smith. S mit h, just a few m a tters will you just turn 18 to your l e t t e r 19 particulars. 20 MR. 24 5 Q 22 ( E x h i b i t 1), S MI T H : I just w a n t to get some A l l right. O n t h e s e c o n d p a g e o f y o u r l e t t e r y o u g i v e a l i s t of directors ? 23 A 24 246 Q 25 26 at a n y s t a g e a n d t h a t F o y ' s n a m e o n it b u t w e d i d n ' t a c t f o r it. 16 21 Shanley's C a n I a s k y o u i f y o u c o u l d t e l l us a n y t h i n g a b o u t Montoire Limited, 9 15 s a y t h a t M a y b a c h w a s n ' t Mr. Yes . Cecil G a rreth Walker, w h o is he, Mr. Smith, do you remember? A I h a v e n o i d e a. He is p r o b a b l y o n e o f t h e s e c o m p a n y 27 formation people. 28 K e n n e d y C r o w l e y b u t it m i g h t n ' t b e t h e s a m e f e l l o w . 29 247 Q If w e m o v e o n then , There was a W a l k e r in Stokes Clive Redrup, y o u s a y he w a s 1 2 Yes . 3 248 Q 4 A 5 Do y o u k n o w w h a t h e is? He w a s an a c c o u n t a n t , at l e a s t a n i n t e r n a l accountant. 6 249 Q 7 A 8 25 0 Q 9 A 10 25 1 Q 11 A n i n t e r n a l a c c o u n t a n t i n Mr. Shanley's business? Correct. In t h e U.K. Yes . K e n n e t h A l l e n Lawless, is h e t h e Mr. Lawless who you mentioned earlier? 12 A 13 252 Q 14 Yes. H e w a s an i n t e r n a l a c c o u n t a n t as w e l l . He w a s an i n t e r n a l a c c o u n t a n t a n d h e w a s i n D u b l i n , w a s he ? 15 A 16 25 3 Q 17 A 18 254 Q A n d l o o k i n g a f t e r Mr. S h a n l e y affairs in Ireland? 19 A A m o n g s t other things, yes. 20 25 5 Q 21 W a s he a l l t h e t i m e i n I r e l a n d ? Yes . T h e n w e h a v e y o u r s e l f a n d t h e n we h a v e M a u r e e n O ' B r i e n a n d t h a t is h i s s i s t e r ? 22 A 23 256 Q 24 A 25 26 He w a s in D u b l i n a n d s t i l l is I b e l i e v e . A s ister of M i c h a e l Shanley's, yes. W h o h a d b e e n a d i r e c t o r since 1984? Yes. S h e is t h e s a m e M a u r e e n O ' B r i e n as t h e M a u r e e n O'Brien Settlement. 257 Q Yes. Now, Mr. Sm i t h , during the time that you were 27 d i r e c t o r or from the k n owledge that you have 28 o b t a i n e d as a d i r e c t o r d i d M a y b a c h o b t a i n o t h e r 29 loans f r o m G u i n n e s s a n d M a h o n e i t h e r i n t h e U.K. or 1 2 3 258 Q 4 5 To y o u r k n o w l e d g e , no, a n d d i d it o b t a i n l o a n s from other institutions? A It w o u l d h a v e in t h e n o r m a l way, I presume, yes. A 6 s e a r c h in t h e c o m p a n y ' s o f f i c e w o u l d d i s c l o s e a n y 7 m o r t g a g e s o r c h a r g e s t h a t it p u t i n p l a c e b u t t h e r e 8 was n o thing unusual about the company's operations. 9 259 Q You have just s a i d t h a t in t h e c o m p a n y ' s a c c o u n t s it 10 w o u l d s h o w t h e l o a n f r o m t h e K a t h a r i n a Tr u s t , 11 that right? 12 A 13 Yes. I w o u l d h a v e a s k e d Pat G u i n a n a b o u t that specifically, 14 26 0 Q 15 A 16 26 1 Q 17 A 18 is yes. You mean when you were a director? No, but whe n I got your letter. Well, I k n o w it is v e r y h a r d ? I wouldn't remember. When I was a director I w o u l d n ' t r e m e m b e r w h a t was in the a ccounts. 19 262 Q 20 A Y o u w e r e t o l d b y Pa t G u i n a n ? R e c e n t l y I w e n t a n d I s a i d -- m y u n d e r s t a n d i n g , 21 so r r y , 22 d i r e c t o r m y u n d e r s t a n d i n g w a s t h a t it h a d l o a n f u n d s 23 a n d o b v i o u s l y I h a d c a r r i e d o u t a n y i n q u i r i e s in 24 at a t i m e w h e n I w a s a d i r e c t o r , 25 b e c o m e a w a r e in m y c a p a c i t y as s o l i c i t o r o f t h e 26 i n f o r m a t i o n y o u a r e n o w a s k i n g me. 27 What 28 us is t h a t it a p p e a r s i n t h e a c c o u n t s t h a t t h e 29 K a t h a r i n a Trust h ad lent m o n e y t o . . . ( I N T E R J E C T I O N ) ? to a n s w e r y o u r q uestion, I a m c o m i n g t o is thi s, at t h e t i m e I w a s a so, '82 I would have t h a t y o u r e v i d e n c e to 1 2 264 Q 3 A Well, I d i d say to h i m the r e a s o n I k n e w that the 4 K a t h a r i n a Trust h ad a d v a n c e d m o n e y f rom the 5 investigations 6 g o n e b a c k to h i m a n d s a i d d i d t h e a c c o u n t s 7 n a m e K a t h a r i n a T r u s t a n d t h e a n s w e r w a s yes. 8 26 5 Q 9 A I wouldn't, say, 11 know. 2 66 Q 13 14 15 267 Q 17 A 18 268 Q 19 you We w i l l r e q u i r e to get to see t h e s e a c c o u n t s bu t we Shanley? W e l l t h o s e a c c o u n t s w o u l d h a v e b e e n s u b m i t t e d to the T h e y are on record. Yes . A r e the r e v e n u e p r i v y to e v i d e n c e I give today. T h e e v i d e n c e y o u g i v e t o d a y is a b s o l u t e l y c o n f i d e n t i a l t o us. 20 A 21 269 Q 22 I see. B u t o f c o u r s e w h a t w e p u t in o u r r e p o r t w i l l b e b a s e d o n t h e e v i d e n c e w e get. A 24 25 as I p r e s e n t e d to m e b y S t o k e s K e n n e d y Crowley, revenue. 16 23 I w ould have signed the accounts, c a n t a k e t h a t u p d i r e c t l y w i t h Mr. A show the Y o u d o n ' t r e c o l l e c t it f r o m y o u r o w n r e c o l l e c t i o n ? 10 12 I have m e n t i o n e d but I w o u l d have I see, o kay but a t r a n s c r i p t of m y e v i d e n ce won't be f o r w a r d e d i n t o t a l to t h e r e v e n u e ? 27 0 Q It is o u r d o c u m e n t a n d y o u w i l l g e t t h e t r a n s c r i p t 26 a n d w e w i l l c h e c k it h o p e f u l l y a n d t h e n y o u w i l l 27 s i g n it a n d it is o u r d o c u m e n t a n d w h a t w e t h e n do 28 w i t h it is a m a t t e r f o r us. 29 a n y b o d y as y o u k n o w w e a r e o f f i c e r s of t h e c o u r t ? W e d o n ' t s e n d it to 1 It is j u s t t h a t 2 be a doubtful 3 senior members 4 p a r t i c u l a r Inquiry. 5 concern, 6 information. 7 27 1 Q 8 I h a v e r e a d in t h e p a p e r s , s o u r c e of i n f o r m a t i o n , which may that there were of t h e r e v e n u e a s s i g n e d t o t h i s T h a t c a u s e d m e a b i t of seeing that I am giving confidential W i t h r e g a r d to t h e M a u r e e n O ' B r i e n S e t t l e m e n t a n d the r e p a y m e nt of the mo n e y ? 9 A 10 272 Q Yes . When you were giving evidence f i r s t i n r e l a t i o n to 11 that you s aid that the M a u r e e n O ' B r i e n f und was u s ed 12 to r e p a y t h e l o a n to G . M . I . , 13 A That's fu nd s, to G u i n n e s s a n d M a h o n ? I t h i n k w h a t h a p p e n e d t h e r e is t h a t 14 Maureen O'Brien trustees directed, 15 d o c u m e n t a t i o n to s h o w that this d i r e c t i o n t o o k p l a c e 16 b u t w h a t I u n d e r s t a n d is t h a t t h e M a u r e e n O ' B r i e n 17 Settl e m e n t t r u stees d i r e c t e d K e e l a d r u m to pa y the 18 Maureen O'Brien's money over and that would have 19 b e e n f o r t h e b e n e f i t of t h e K a t h a r i n a T r u s t , 20 as I u n d e r s t a n d it. 21 27 3 Q 22 I a m n o t f o l l o w i n g you, Mr. Sm i t h , a g a i n I h a v e no t h i s is if y o u w o u l d j u s t l i s t e n to m e ? 23 A 24 274 Q 25 Yes, yes, okay. A s I u n d e r s t a n d w h a t y o u h a v e t o l d us, there are two s e p a r a t e t h i n g s that you t o l d us? 26 A 27 27 5 Q Yes . O n e w a s t h a t t h e M a u r e e n O ' B r i e n f u n d s w e r e u s e d to 28 r e p a y the b a c k to b a c k l o a n g i v e n b y G.M.I., 29 Guinness Mahon? by 1 2 276 Q 3 A 4 277 Q 5 A 6 Well, Yes, n o w t h i s is w h a t I w a n t t o f i n d o u t ? okay. A m I c o r r e c t in s a y i n g t h a t y o u d i d s a y t h a t ? Again, I w o u l d h a v e to s e e t h e t r a n s c r i p t t o k n o w exactly what 7 278 Q 8 A 9 I s aid. Then you told u s ...(INTERJ E C T I O N ) ? I think, s o r r y for i n t e r r u p t i n g but I t h i n k what I w o u l d h a v e b e e n g i v i n g is t h e b r o a d o u t l i n e of 10 e v e n t s as I s a w them, 11 simplifying the procedure but 12 the M a u r e e n O ' B r i e n funds w ere r e p a i d b y K e e l a d r u m 13 a n d s e t t l e d on the n e w trust, 14 t r u s t e e s w h o w e r e t h e t r u s t e e s of t h e K a t h a r i n a . 15 T h e a c t u a l d o c u m e n t a t i o n p u t t i n g t h o s e s t e p s in 16 p lac e . ..(INTERJECTION). 17 279 Q 18 You are not Mr. 19 A 20 28 0 Q 21 I w o u l d have said that which was Sovereign following the question I am asking yes. S m i t h y o u t o l d us t w o s e p a r a t e t h i n g s a n d p e r h a p s y o u c o u l d c l a r i f y w h a t t h e p o s i t i o n i s? 22 A 23 28 1 Q Yes . T h e s e c o n d t h i n g y o u t o l d us w a s t h a t t h e M a u r e e n 24 O'Brien Settlement 25 Trust trustees? 26 A 27 282 Q 28 A 29 I may have been Sm i t h . O k ay , Mr. right. funds were p a i d to the Ka t h a r i n a Correct. A n d that th e y t hen lent the m o n e y to M a y b a c h ? That was m y understanding. I think I p r e f a c e d that anything I said was m y understanding. I wasn't a 1 2 Now, 3 y o u h a v e g i v e n us, 4 o v e r to the t r u s t e e s of the K a t h a r i n a T r u s t w ho t h e n 5 l e n t it b a c k t o M a y b a c h a n d t h e o t h e r w a s t h a t t h e 6 m o n e y was used from the Maur e e n O'Brien Settlement 7 to p a y off the G.M.I. 8 loan? 9 A I w a n t to k n o w c a n y o u e x p l a i n t h e t w o a n s w e r s o n e is t h a t t h e m o n e y w a s p a i d l o a n that was the b a c k to b a c k I t h i n k t h e m i s s i n g w o r d t h e r e w a s u s e d b y w h o m, 10 u s e d b y w h o m a n d m y u n d e r s t a n d i n g is t h a t it w a s 11 u s e d b y t h e K a t h a r i n a T r u s t t o do it. 12 284 Q 13 A 14 28 5 Q 15 A 16 17 was To d o w h a t ? To g i v e t h e m o n e y to M a y b a c h t o p a y b a c k t h e loan . I see? M y u n d e r s t a n d i n g of t h e p o s i t i o n i s ...(INTERJECTION). 286 Q So the m o n e y t h e n was b e i n g t r a n s f e r r e d f r o m the 18 t ru s t e e s of the M a u r e e n O ' B r i e n f und to the tr u s t e e s 19 o f t h e K a t h a r i n a T r u s t w h o s e n t it t o M a y b a c h a n d 20 M a y b a c h u s e d t h o s e funds to p a y off the l o a n f r o m 21 G . M . I .? 22 A 23 287 Q 24 A W h e n y o u s a y s e n t it t o M a y b a c h . . . ( I N T E R J E C T I O N ) . L e n t it, Okay , l e n t it to M a y b a c h . w h e n I d i d m y r e s e a r c h o n e of t h e m a t t e r s t h a t 25 e m e r g e d was that t h e r e was a s h o r t a g e of p a p e r w o r k 26 to r e c o r d . . . ( I N T E R J E C T I O N ) . 27 288 Q 28 A 29 289 Q Mr. Sm i t h. .. (INTERJECTION)? T h i s is t h e o n l y w a y I c a n a n s w e r . . . ( I N T E R J E C T I O N ) . J u s t l i s t e n to t h e q u e s t i o n ? 1 2 No, 29 0 Q I know what the question you ...(INTERJECTION). T h e q u e s t i o n I a m a s k i n g y o u is, if I c a n c o r r e c t l y 3 summarise the position, 4 t r a n s f e r r e d t o t h e K a t h a r i n a t r u s t e e s w h o l e n t it to 5 M a y b a c h a n d M a y b a c h u s e d it to p a y o f f t h e l o a n ? 6 A 7 that the m o n e y was T h a t w a s t h e p r o c e d u r e as t o l d t o m e b u t I h a v e n o evidence...(INTERJECTION). 8 29 1 Q 9 A I appreciate that? A n d w h a t I w a s g o i n g on t o s a y is t h a t w h e n I g o t 10 i n s t r u c t i o n s to l o o k into the m a t t e r t h a t the a c t u a l 11 d o c u m e n t a t i o n to s u p p o r t t h e a c t u a l m o v e m e n t s o f t h e 12 f u n d w e r e n o t a v a i l a b l e t o m e a n d at t h a t s t a g e I 13 requested that Stokes Kennedy Crowley w o u l d furnish 14 the n e c e s s a r y d o c u m e n t a t i o n and a m e m o r a n d u m was 15 p r e p a r e d w h i c h w a s s e t down , 16 is n o s i g n a t u r e s o n t h e c o p y t h a t I have , 17 t ru s t e e s of the two s e t t l e m e n ts a c k n o w l e d g i n g what 18 happened. 19 292 Q 20 A 21 29 3 Q 22 A 23 of t h e Very w e l l . T h a t is t h e n e a r e s t I c a n com e. T hat's p r e t t y close and that was in 1982? It w o u l d b e s u b s e q u e n t a b o u t ' 8 5 / ' 8 6 b u t a g a i n it is taken from memory. 24 294 Q 25 A 26 29 5 Q 27 A 28 296 Q 29 I have a copy and there C a n y o u g i v e us t h a t ? A n y t h i n g I h a v e w i l l b e o n t h e file. Y o u c a n g i v e us t h a t t h e n ? Yes . What 1882? I u n d e r s t a n d t h e n is t h a t y o u m a d e e n q u i r i e s in 1 2 297 Q 3 A But then you must have made inquiries later then? W h a t h a p p e n e d was, I would have been quite busy and 4 Mr. 5 something and Maybach, 6 o f Mr. 7 to m e t o w a r d s t h e e n d o f ' 82 a n d s o u g h t m y a d v i c e as 8 to w h e r e h e s t o o d i n r e l a t i o n t o a l l of t h e s e t h i n g s 9 b e c a u s e he d i d n ' t u n d e r s t a n d t h e m a n d d i d n ' t S h a n l e y was quite b u s y and the trust was which wasn't the m a i n s t r e a m S h a n l e y ' s a c t i v i t i e s a n d he w o u l d h a v e c o m e know 10 t o o m u c h a b o u t t h e m. 11 will disclose some sentiments along those lines and 12 from the e n q u i r i es 13 i n f o r m a t i o n e v o l v e d a n d a p e r i o d of a b o u t t h r e e 14 years or that b e f o r e an y f u r t h e r a ctivity. 15 298 Q 16 A 17 so, a n d w e m e t at t h e time , 299 Q 19 A 20 y o u a r e g o i n g t o g i v e us a l l of t h i s ? Th at's right. It c a m e in s t a r t s p e o p l e g o t V e r y well. E v e r y t h i n g I h av e , Mr. 30 0 Q Y o u c a n g i v e us a l l t h e s e d o c u m e n t s ? s u b j e c t to m e t e l l i n g Shanley. V e r y well. Just for our own information, 22 Mr. 23 he a l s o c a r r i e d o n b u s i n e s s 24 w h e r e . .. (INTERJECTION)? 25 certain e n t h u s i a s t i c a b o u t it. 18 21 I see, I t h i n k the c o r r e s p o n d e n c e A S h a n l e y was c a r rying on b u s i n e s s Mr. S mi th, in I re l a n d and in London, do you know I d o n ' t t h i n k he c a r r i e d o n a n y b u s i n e s s in Ireland in his own n a m e bu t he c e r t a i n l y . . . ( I N T E R J E C T I O N ) . 26 27 30 1 Q 28 A 29 302 Q Through the c o m p a n i e s . Through companies. Yes. 1 2 30 3 Q. 3 A. 4 304 Q. 5 6 Yes. Y o u d i d m e n t i o n t h a t h e w e n t t o E n g l a n d at t h e a g e of 15, A. 7 d id he s p e n d all his life in En g l a n d ? I t h i n k if he c omes h e r e he w i l l t e l l yo u all a b out it. 8 30 5 Q. 9 A. 10 3 0 6 Q. 11 12 In E n g l a n d ? I just want t o ...(I N T E R J E C T I O N ) ? I am not s a y i n g that but he i s . . . ( I N T E R J E C T I O N ) . I just w a n t to get a q u i c k t o u r myself, d i d he live a l l h i s w o r k i n g l i f e in E n g l a n d ? A. He c a m e f r o m D r u m s h a n b o i n c o u n t y L e i t r i m , he w o u l d 13 h a v e b e e n d e p r i v e d of the o p p o r t u n i t i e s t h a t are n o w 14 a v a i l a b l e in I r e l a n d . . . ( I N T E R J E C T I O N ) . 15 307 Q. 16 A. 17 18 Well, you a s k e d me the question, so, if y o u w a n t a fen fichre? 308 Q. 19 No, I don't, I do n ' t , I just w a n t to k n o w d i d he r e s i d e in I r e l a n d or E n g l a n d ? 20 A. 21 3 0 9 Q. 22 A. 23 He w a s Yes, f o r c e d t o go t o E n g l a n d . . . ( I N T E R J E C T I O N ) . d i d h e r e s i d e in E n g l a n d ? The w a y that m ost people from Cavan and Leitrim and a l l t h o s e c o u n t i e s h a d t o go in t h e 50's. 24 31 0 Q. 25 A. 26 31 1 Q. 27 A. 28 312 Q. 29 W e l l ... ( I N T E R J E C T I O N ) ? D i d he r e s i d e in E n g l a n d ? He r e s i d e d a n d s t i l l r e s i d e s in E n g l a n d . That's what I w a n t e d t o f i n d out. V e r y well. I th o u g h t you w a n t e d a bit of b a c k g r o u n d ? No, no, n o t at all. 1 f o r t h e t y p e of t h i n g w e a r e t a l k i n g a b o u t t o d a y . 2 There should be m o r e r e s e a r c h b y the G o v e r n m e n t 3 t h i n k o n w h y t h o s e p e o p l e h a d to l e a v e . 4 31 3 Q 5 A 6 314 Q 7 A Well, I we h a v e e n o u g h to do our s e l v e s . I know, I know. V e r y w el l , Mr. Sm i t h , t h a n k you for your attendance. If t h e y g a v e t h e m o n e y t h a t t h e y a r e s p e n d i n g o n t h e 8 i n s p e c t o r a t e and the t r ibunals over to some of these 9 h o m e l e s s p e o p l e in E n g l a n d . 10 31 5 Q 11 A 12 I w o n ' t m a k e a n y c o m m e n t o n that. N o b o d y is i n t e r e s t e d a n d y o u w e r e a v e r y g o o d m a n in y o u r day. 13 316 Q 14 A There should be somebody interested. T h a n k y o u v e r y m u c h Mr. Smith. T h a n k you. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE HEARING WAS THEN CONCLUDED S ^ ^ -7 fH C^Cus^ U mIM wT 7L (Cl# * ^Jj - l — ' C u j IY\ \aj^ •^ o V x c i^ r . \OuJuV S s \vAcu^ Appendix XV (120) Mr John D Sheridan 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr John D Sheridan. a) Letter o f 28 January 2002 - Gibbs & McCurley Attorneys to the Inspectors. G ib b s & M c C urley , p.a AttorneysAtlaw 100 Second Avenue South, Suite 704-S S t Petersburg, Florida 33701 Telephone (727) 892-6001 Facsimile (727) 892-6002 January 28, 2002 His Honour Judge Sean O’Leary Ms. Noreen Mackey B.L. Mr. Paul Rowan FCA Mr. Michael Cush S.C. Re: Ms. Susan Sheridan Mack Dear Sirs and Madams: Reference is made to your correspondence of December 17, 2001 affording Ms. Sheridan Mack an opportunity to provide you with a written reply to the preliminary conclusions reached by you relating to Ansbacher. Please be advised that Ms. Mack has retained the undersigned to represent her with respect to this matter. As you may or not be aware, Ms. Mack’s father, John D. Sheridan died in January, 1983. Subsequently, in 1985 Ms. Mack first heard of Ansbacher and began receiving distributions. Ms. Mack has no idea how she acquired her interest, but presumed that it was inherited from her father. Please understand that Ms. Mack is never considered herself a “client” of Ansbacher and still does not do so. Again, she has little knowledge of the investment and still assumed that it was inherited. If we can be of any further service to you please contact the undersigned. Sincerely, GIBBS & McCURLEY, P.A. BGG/Wk Appendix XV (121) Mr Jack Stakelum 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Jack Stakelum. a) Transcript of evidence o f Mr Jack Stakelum dated 8 November 2000. b) Transcript o f evidence of Mr Jack Stakelum dated 6 December 2000. c) Letter of 15 January 1990 - Ansbacher Limited to Guinness and Mahon. d) Letter o f 16 May 1990 - Ansbacher Limited to Guinness and Mahon. e) Letter o f 5 February 1991 - Joan Williams to IIB. f) Letter o f 6 November 2000 - Jack Stakelum to the Inspectors. g) Letter o f 3 April 1990 - Ansbacher Limited to Guinness and Mahon. h) Letter o f 11 December 1990 - Ansbacher Limited to Guinness and Mahon. i) Letter o f 30 January 1992 - Ansbacher Limited to IIB. j) Letter o f 8 August 1994 - Hamilton Ross Company Limited to IIB. Correspondence written by or on behalf o f Mr Jack Stakelum. a) Letter of 8 November 2001 - Mr Jack Stakelum to Inspectors. :?APpendi?x? UNDER OATH ON WEDNESDAY, 8TH N O V E M B E R 2000 I h e r e b y c e r t i f y the f o l l o w i n g to be a t r u e an d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO M R . ROWAN FCA MS. M A C K E Y BL S o l i c i t o r to the I n s p e c t o r s MS. M. C U M M I N S Interviewee: MR. JACK STAKELUM A c c o m p a n i e d by: MR. KARL HAYES GORE & GRIMES SOLICITORS CAVENDISH HOUSE SMITHFIELD DUBLIN 7 1 2 3 4 MR. JUSTICE COSTELLO 5 Mr. Stakelum, we will s t a r t o u r i n t e r v i e w now. 6 I will introduce the inspectors. 7 I am Declan Costello. 8 a n d Mr. 9 be e n ap p o i n t e d inspectors by the High Court. Ms. M a c k e y is o n m y r i g h t R o w a n is o n m y l e f t. As you know we have This 10 is a n i n t e r v i e w a n d I s h o u l d e x p l a i n , 11 t h a t it w i l l b e u n d e r oa t h . 12 s o l i c i t o r i n a m o m e n t t o a d m i n i s t e r t h e o a t h to you. 13 B u t i f d u r i n g t h e i n t e r v i e w w e a s k y o u q u e s t i o n s on 14 w hich you w o u l d like legal advice, 15 w h o e v e r is a s k i n g y o u t h e q u e s t i o n s -- a n d w e w i l l 16 stop and you can consult with your solicitor. 17 Similarly, 18 t h a t he s h o u l d g i v e y o u l e g a l a d v i c e o n a n y 19 question, 20 a n d h e c a n t h e n d i s c u s s t h e m a t t e r w i t h you. 21 22 23 24 25 26 27 28 29 Mr. Stakelum, I will ask our p l e a s e tell us - ­ s h o u l d y o u r s o l i c i t o r t h i n k it p r o p e r h e c a n i n d i c a t e to u s t h a t w e s h o u l d s t o p 1 2 3 4 MR. JUSTICE COSTELLO 5 Mr. Stakelum, regretfully we onl y r e c e i v e d y e s t e r d a y 6 in t h e m i d d l e o f t h e m o r n i n g y o u r l e t t e r of 7 6 t h N o v e m b e r i n r e p l y to o u r l e t t e r , 8 correspondence. 9 can not a d e q u a t e l y complete the i n t e r v i e w this 10 m o r n i n g b e c a u s e a nu m b e r of m a t t e r s have to be 11 i n v e s t i g a t e d b y us b e f o r e w e c o n t i n u e a s k i n g y o u 12 questions, 13 this 14 correspondence. 15 to m a k e s o m e p r o g r e s s t h i s m o r n i n g a n d t h e n to 16 a d j o u r n our i n t e r v i e w to p e r h a p s not n e x t w e e k but 17 the w e e k after, our previous U n f o r t u n a t e l y this m e a n s that we m a t t e r s w h i c h h a v e b e e n r a i s e d b o t h in l e t t e r t h a t w e go t y e s t e r d a y a n d i n t h e e a r l i e r W hat I w o u l d hope to do w o u l d be i f we c o u l d f i n d a s u i t a b l e date . 18 19 W h a t I p r o p o s e to do, Mr. 20 t r y to g e t s o m e g e n e r a l m a t t e r s c l a r i f i e d a b o u t y o u r 21 career and your association with Guinness 22 h e r e in Ireland, 23 w h a t h e l p yo u can give us a b o u t the s e r v i c e s w h i c h 24 A n s b a c h e r g a v e to c l i e n t s of y o urs h e r e in I r e l a n d 25 or w h a t y o u m a y k n o w a b o u t t h e s e r v i c e s . 26 as y o u know, 27 H i g h C o u r t t o do is t o i n v e s t i g a t e t h e a f f a i r s of 28 Ansbacher. 29 l i k e to a s k y o u s o m e f u r t h e r q u e s t i o n s a b o u t a a n d Mr. Stakelum, n o w is j u s t to & Mahon T r a y n o r in particular, and Because what we are r e q u i r e d b y the T h a t h a v i n g b e e n done , we w o u l d then 1 c o u p l e of the d e t a i l e d m a t t e r s that we w r o t e to you 2 about: 3 affairs. 4 b ackground information, 5 w o u l d n ' t m i n d g i v i n g it t o us. 6 y o u r c a r e e r as a n a c c o u n t a n t , 7 o u t l i n e it f o r us. 8 A. 9 Ms. B a n o t t i ' s a f f a i r s a n d Mr. Keane's I w o u l d l i k e to s t a r t w i t h s o m e g e n e r a l Mr. Stakelum, if y o u F i r s t of a l l a b o u t if y o u c o u l d b r i e f l y I c o m m e n c e d t r a i n i n g as a n a r t i c l e d c l e r k w i t h a firm ca l l e d B o l a n d O ' D o w d but the y broke up and I 10 t r a n s f e r r e d to H a u g h e y B o l a n d & Co in or a b out 11 I t h i n k l a t e 1956. 12 Mr. 13 I q u a l i f i e d in t h e m e a n t i m e a n d r e j o i n e d t h e m in 14 19 62. 15 t h e fi rm. 16 l e f t H a u g h e y B o l a n d & C o i n 1 9 7 0 or 1 9 7 1 a n d j o i n e d 17 Guinness 18 own c o n s u l t a n c y company, 19 w h i c h is w h e r e 20 I c l o s e d t h e o f f i c e a n d l e t t h e c o m p a n y r u n d o w n in 21 19 98. 22 1 Q. 23 24 Traynor. T h a t is w h e r e I w o u l d h a v e m e t I l e f t H a u g h e y B o l a n d i n 1958. At that s t a g e Mr. T r a y n o r w a s a p a r t n e r in T h e n I b e c a m e a p a r t n e r i n 1967 . & Mahon. I left in late He 1975 to f o r m m y B u s i n e s s E n t e r p r i s e s Ltd, I operated until I semi-retired; I o p e r a t e a f e w c l i e n t s f r o m h o m e now. C o u l d y o u t e l l m e a b o u t t h e n a t u r e of t h e b u s i n e s s t h a t y o u s t a r t e d in 17, A. 1956, T h at's right. 17, C l y d e Road, is t h a t r i g h t ? Clyde R o a d was m y o ffice u ntil 25 c l o s e d t h a t in O c t o b e r 1998. 26 all the time a fter le a v in g H a u g h e y Boland, 27 didn't operate 28 financial consultancy company whereby I provided 29 financial s e r v i c e s to c l i e n t s , I I operated from there f r o m a n y w h e r e e ls e . so I That was a s o m e t i m e s b e i n g on 1 t heir b o a r d of directors, 2 o n w h a t t h e w i s h e s of t h e c l i e n t s w e r e a n d w h a t w a s 3 suitable 4 h a v e b e e n i n v o l v e d in t h e f i n a n c i a l 5 w i t h b a n k s a n d a r r a n g i n g sh o r t , 6 loans. 7 B u t s o m e c l i e n t s w o u l d h a v e y o u d o a l o t of w o r k f o r 8 t h e m a n d m o r e a lo t l e s s. 9 i n t e r v i e w i n g for re p l a c e m e n t more times not depending for the occasion. M o s t of t h e w o r k w o u l d field dealing medium and long-term Monitoring their financial requirements. Some w o u l d include s t a f f i n v o l v i n g y o u in 10 t h e n o r m a l d a y - t o - d a y b u s i n e s s d e c i s i o n s of t h e 11 company. 12 s p e c i f i c n e e d s a r o s e in c o n n e c t i o n w i t h b a n k i n g . 13 M o s t l y banking. 14 2 Q. 15 A. O t h e r s w o u l d n ' t r e q u i r e you, You had two companies, only when is t h a t r i g h t ? T h e r e is s o m e c o n f u s i o n a b o u t t ha t . Business 16 Enterprises Ltd was the ma i n company. 17 c o m p a n y c a l l e d B E L S e c r e t a r i a l Ltd. 18 the initials of b u s i n e s s enterprises. 19 provide 20 h a v e b e e n a p p o i n t e d s e c r e t a r y to s o m e c o m p a n i e s b u t 21 it n e v e r f u n c t i o n e d i n t h e s e n s e t h a t it 22 never...(INTERJECTION). 23 3 Q. 24 A. 25 4 Q. secretarial We had a The " B E L " is T h a t w a s to s e r v i c e s to c o m p a n i e s . It m a y The m a i n one was Bus i n e s s E n t e r p r i s e s Ltd? Absolutely, yes. You were d i r e c t o r of this company. Did you have 26 a n y b o d y e l s e in t h e c o m p a n y w i t h y o u as a f e l l o w 27 director? 28 29 A. I ha d one col l e a g u e wit h me from the time I star t e d up to about 1986 and then I got another. 1 5 Q 2 3 W h e n you say a colleague, d i d he ow n p a r t of the e q u i t y of the c o m p a n y ? A No, I t h i n k we o n l y h ad two shares issued. 4 w r o n g a b o u t tha t, 5 issued, 6 of the w h o l e l o t . 7 6 Q 8 A 9 7 Q but I m a y be t h e r e m i g h t h a v e b e e n a 100 s h a r e s I w o u l d have b e e n the b e n e f i c i a l owner Of the w hole 100? Yes . W h e n you say you had a colleague, is t h a t j u s t 10 s o m e b o d y w h o m e r e l y a c t e d as a d i r e c t o r t o c o m e to 11 the b o a r d of d i rectors m e e t i n g s ? 12 A No, he w o u l d h a v e w o r k e d w i t h me. O r i g i n a l l y it w a s 13 a n a s s i s t a n t t h a t w a s w i t h m e in H a u g h e y B o l a n d & Co 14 t h a t c a m e w i t h m e at t h e ti m e . 15 8 Q 16 A 17 9 Q What was his name? J o s e p h Seely. He w o u l d h a v e l e f t a b o u t 1986. He w o u l d h a v e b e e n 18 replaced. Then I would have recruited another 19 colleague f r o m w h a t w a s H a u g h e y B o l a n d & C o or 20 Deloitte 21 10 Q 22 A 23 11 Q 24 A 25 12 Q 27 A 28 13 Q 29 What was his name? Ian Murray. W e r e t h e y on the p a y r o l l of the c o mpany? T h a t 's r i g h t . So t h a t i n fact, company, 26 & Touche? it r e a l l y w a s v i r t u a l l y a o n e - m a n it w a s y o u r c o m p a n y ? Th at's right. You had one assistant, later? Mr. S e e l y a n d Mr. Murray 1 2 14 Q 3 A 4 15 Q 5 6 The o n l y o ther one was a secretary. Can you give me the names of the secret a r i e s that you employed? A M y o w n s e c r e t a r y is Ms. A n n V e r d o n . She w o u l d be 7 w i t h m e 30 y e a r s . 8 B o l a n d & Co a n d c a m e w i t h me. 9 b a c k t here w o u l d be an e xtra y o un g e r girl but I She was w i t h me in H a u g h e y At stages 10 w o u l d be s t r u g g l i n g to r e m e m b e r names. 11 have changed periodically. 12 16 Q 13 A 14 17 Q further They would T h e m a i n p e r s o n w a s Ms. V e r d o n ? T h a t ' s right, yes. I w a n t y o u to b e a l i t t l e m o r e e x p l i c i t a b o u t y o u r 15 business. 16 c a r r y o u t a n y a c c o u n t a n c y w o r k fo r y o u r c l i e n t s . 17 Did you audit their books 18 A No. D i d y o u ac t as a n a c c o u n t a n t . Did you for e x ample? I w o u l d n ' t h a v e b e e n i n p r a c t i c e as a n a u d i t o r 19 at t h a t s t a g e . 20 assignments 21 I t h i n k i n t h e s e n s e of a c c o u n t a n c y , 22 T here w o u l d have b e e n some things w h e r e b y we w o u l d 23 have operated the payroll 24 p r i n c i p a l l y was to p r e s e r v e c o n f i d e n t i a l i t y for the 25 c l i e n t f r o m staff. 26 so t o t h a t e x t e n t w e w o u l d h a v e b e e n d o i n g 27 accounting. 28 29 There would have been different c a r r i e d ou t f o r d i f f e r e n t c l i e n t s . ve r y little. for clients, which We w ould have o p erated payroll, 1 19 Q 2 A No, I wouldn't know a n y t h i n g about tax really. 3 I was n ev e r a tax a d v i s e r and n e ve r an auditor. 4 M y f u n c t i o n w a s m o s t l y in t h e f i n a n c e a r e a w i t h 5 banks and then general business. 6 20 Q 7 A 9 21 Q 10 A Raising loans and organising loans and organising Yes, for your clients? that's right. Providing whatever was needed to t h e b a n k s . 22 Q 14 15 T h a t ' s right. securities 12 13 was that r a i s i n g m o n e y for your c l ients? 8 11 B e i n g in the financial area about banks, The b anks w o u l d re q ui r e s e c u r i t y for loans and you w e r e i n v o l v e d in t h a t ? A Yes, that's right. I w o u l d be i n v o l v e d in talk i n g 16 to t h e b a n k s a n d o f f e r i n g w h a t s e c u r i t y w o u l d b e 17 a v a i l a b l e to t h e b a n k s i n c o n n e c t i o n w i t h lo a n s . 18 23 Q 19 A 20 24 Q It w o u l d b e a n i n t e g r a l p a r t o f y o u r w o r k ? Absolutely. W h e n Mr. T r aynor left the b a n k and left 21 Haug h e y Boland and went 22 b e f o r e that a d i r e c t o r of Guinness 23 or a m I w r o n g in that, 24 A full-time, he h a d b e e n & Mahon Ireland b e f o r e he left full-time? I d o n ' t a c t u a l l y k n o w t ha t . I k n o w t h a t he w a s 25 d o i n g a lo t o f w o r k f o r t h e b a n k i n c o n n e c t i o n w i t h 26 c e r t a i n l y t h e i r c l i e n t s b e f o r e he l e f t 27 H a u g h e y B o l a n d & Co t o j o i n t he m . 28 w h e t h e r h e w a s a d i r e c t o r o r not. 29 Do y o u k n o w t h a t w h e n h e j o i n e d t h e m h e b e c a m e C h i e f 9 I don't know 1 Executive. 2 Chief Executive? 3 At the t i m e that he j o i n e d t h e r e was J o h n G u i n n e s s 4 in the b a n k and W i l l i a m Forde. 5 something, 6 John Guinness Chairman. I'm not sure who would 7 h a v e b e e n j o i n t w i t h him, but maybe W i l l i a m Forwood. 8 26 Q 9 He w a s V i c e C h a i r m a n a n d like joint m a n a g i n g director and pro b a b l y Y o u w e r e d e s c r i b e d in t h e M c C r a c k e n r e p o r t as a close personal 10 He b e c a m e j o i n t f r i e n d o f Mr. Traynor's, correct? 11 A 12 27 Q 13 A 14 28 Q Me? Yes ? Yes, v e r y close. W o u l d he h a v e t o l d yo u a b o u t the e s t a b l i s h m e n t of 15 the offshore companies that Guinness 16 i n v o l v e d in? 17 is t h a t A I w o u l d have b e c o m e aware; & Mahon were I wouldn't necessarily 18 k n o w w h a t t h e s t r u c t u r e m i g h t be. 19 a l m o s t that he w o u l d be t e l l i n g me that. 20 c e r t a i n l y a w a r e that he was i n v o l v e d w i t h Cayman. 21 29 Q 22 A It w o u l d n ' t b e But I was Tell me what you understood? I a m n o t s u r e w h a t d a t e s o r s t a g e s he w o u l d h a v e 23 been very involved with the Cayman islands. 24 C e r t a i n l y at s t a g e s h e u s e d t o b e g o i n g o u t to 25 C a y m a n t h r e e o r f o u r t i m e s a y ea r . 26 m e t at o n e s t a g e s o c i a l l y J o h n F u r z e a n d 27 John Collins. 28 I w o u l d h a v e m e t t h e m p r o b a b l y at d i n n e r in 29 Mr. I would have The y w o u l d have come to Ireland. T r a y n o r 's h o u s e . I am not sure what else I 1 2 It is n o t a q u e s t i o n of w h a t y o u m i g h t h a v e 3 understood, 4 w h a t yo u k n e w a b o u t the o p e r a t i o n s of the s u b s i d i a r y 5 in t h e C a y m a n I s l a n d s ? 6 A Mr. Stakelum, I j u s t w a n t y o u t o t e l l us I a m n o t s u r e h o w t o a n s w e r t h a t u n d e r o a t h in t h e 7 s e n s e of t e l l i n g w h a t t h e t r u t h is or w h a t I w o u l d 8 be imagining. 9 31 Q Do y o u r b e s t , Mr. Stakelum. Tell me what you know 10 about the c o m p a n y that was e s t a b l i s h e d in the 11 Cay m a n Islands, 12 What 13 A 14 32 Q 15 A the subsidiary, a n d w h a t it did. s e r v i c e s d i d it s u p p l y ? A l o t is w h a t I a m r e a d i n g in t h e p a p e r s . Tell me what you know? I guess t here was a c o m p a n y e s t a b l i s h e d in the 16 C a y m a n Islands that w o u l d h ave dealt f rom an Irish 17 p o i n t of v i e w w i t h o f f s h o r e m o n i e s . 18 w h e t h e r t h a t w a s a s u b s i d i a r y o f D u b l i n or w h e t h e r 19 it w a s a s u b s i d i a r y of L o n d o n . 20 o n e s t a g e t h a t it w a s o n e w a y a n d t h e n it m o v e d t h e 21 other w a y for w h a t e v e r internal reasons Guinn e s s 22 M a h o n w o u l d h a v e had. 23 33 Q 24 Have you difficulty, I don't know I h a v e a f e e l i n g at for example, & in know i n g that discretionary trusts were established? 25 A 26 34 Q 27 Well, they probably were but M y q u e s t i o n is, I . . . (INTERJECTION). did you know that they established discretionary trusts? 28 A 29 35 Q No, I w o u l d n ' t h a v e known. Is t h i s t h e f i r s t t i m e y o u h a v e l e a r n e d o f it, 11 from 1 2 I w o u l d suspect that they have from reading papers. 3 36 Q 4 A Tell me what you suspected? I suspected that p r obably trusts were arranged, but 5 I don't know whether they would have been arranged 6 i n D u b l i n a n d o p e r a t e d f r o m C a y m a n or o p e r a t e d f r o m 7 ...(INTERJECTION). 8 37 Q 9 A 10 38 Q Who w ould have been the trustee? I didn't operate any trusts. I a m a s k i n g y o u w h a t y o u r k n o w l e d g e is of t h e 11 company. 12 Mr. 13 A 14 15 Stakelum? I know that t here was G u i n n e s s M a h o n C a y m a n Trust a n d it l a t e r b e c a m e k n o w n as A n s b a c h e r . 39 Q 16 17 Do y o u k n o w t h e n a m e of t h e c o m p a n y , L e t us d e a l w i t h G u i n n e s s M a h o n C a y m a n T r u s t . Do y o u k n o w w h a t t h a t c o m p a n y d i d ? A 18 It w a s a b a n k p r i m a r i l y . a n d I p r e s u m e it w o u l d t a k e d e p o s i t s . 19 40 Q 20 A It t o o k d e p o s i t s , yes? I p r e s u m e it d i d t h e n o r m a l b a n k i n g t h i n g a b o u t 21 making loans. 22 dealings with t h a t . 23 I p r e s u m e d it w a s a b a n k 41 Q But I w o u l d h ave h a d no direct I a m c o m i n g to t h a t la t e r , Mr. Stakelum. I want you 24 to t e l l m e b e c a u s e we h a v e to r e p o r t to the court 25 a b o u t t h e a f f a i r s o f G u i n n e s s M a h o n C a y m a n Tr u s t . 26 Y o u t h i n k it w a s a b a n k a n d it t o o k d e p o s i t s . 27 y o u k n o w a n y t h i n g e l s e a b o u t it? 28 I know that John Furze and John Collins were 29 directors of it. I think they were executive Do 1 2 42 Q. 3 A. 4 43 Q. 5 A. 6 44 Q. 7 A. I a m a s k i n g y o u w h a t it did, I haven't specific knowledge, You haven't General Mr. Costello. go t s p e c i f i c k n o w l e d g e ? knowledge? From general did: 9 loans. 45 Q. Stakelum? No. 8 10 Mr. knowledge Take deposits, I a m not, I a s s u m e it d i d w h a t b a n k s m a k e loans, take securities You are telling me something about trusts? I w a n t t o f i n d o u t w h a t y o u know. 11 n o t k n o w t h a t it c a r r i e d o n a b u s i n e s s 12 trusts ? 13 A. 14 4 6 Q. 15 I don't A. 17 47 Q. 18 A. 19 48 Q. 20 of m a n a g i n g know specifically. Did you know that Guinness Mahon Cayman Trust Ltd No. You didn't? I d o n ' t k n o w that , Y o u s u s p e c t it. was A. I s u s p e c t that . Wh e n did you first suspect that so? T h a t is v e r y h a r d to a n s w e r . I suppose from 22 d i s c u s s i o n s b a c k o v e r t h e y e a r s w i t h Mr. 23 I w o u l d have assumed. 24 49 Q. 25 26 W h y w o u l d y o u h a v e a s s u m e d it, Traynor, w o u l d he not h a v e t o l d you? A. He m a y h a v e b u t t h e r e w o u l d b e n o r e a s o n f o r h i m to 27 come along and say 28 t h e C a y m a n s .' 29 Do y o u a c t e d as t r u s t e e a n d m a n a g e d t r u s t s ? 16 21 No, fo r 50 Q. 'Jack, w e a r e o p e r a t i n g t r u s t s in Y o u l e a r n e d f r o m h i m t h a t h e o p e r a t e d t r u s t s in t h e 1 2 It m i g h t b e f r o m g e n e r a l c o n v e r s a t i o n I w o u l d g l e a n 3 that those things happened. 4 51 Q 5 A 6 52 Q 7 8 Traynor? Yes . T h a t w o u l d b e w h e n it w a s f o u n d e d in the e arly 1 9 7 0 ' s? A 9 10 11 F r o m g e n e r a l c o n v e r s a t i o n w i t h Mr. I p r e s u m e s o m e t i m e like that. I don't know when they started operating trusts f r o m or a n y t h i n g like that , 53 Q so I d o n ' t know. T r y t o l i s t e n t o t h e q u e s t i o n a n d t r y t o b e c l e a r in 12 y o u r a n s w e r so f a r as y o u can. 13 when you first 14 c a r r i e d on a trust m a n a g e m e n t b u s i n e s s ? 15 A 16 17 I am asking you knew that Guinness Mahon Cayman Trust I d o n ' t k n o w the a n s w e r to that ques t i o n ; it w o u l d be i n f o rmation that you might assimilate. 54 Q 18 W h e n did you first k n o w t h a t it c a r r i e d o n t h i s business? 19 A 20 55 Q 21 A 22 56 Q I w o u l d l o v e to h e l p y o u w i t h a n a n s w e r . W e l l try. W a s it e a r l y 1 9 7 0 ' s ? P r o b a b l y s o m e t i m e i n t h e 1 9 7 0 's. S o y o u k n e w s o m e t i m e i n t h e 1 9 7 0 's t h a t t h e r e w a s a 23 c o m p a n y c a l l e d Gui n n e ss M a h o n C a y m a n Trust. 24 y o u k n o w t h a t Mr. 25 A T r a y n o r w a s t h e C h a i r m a n of i t? I d o n ' t t h i n k at t h a t st a g e , but I would have known t h a t he w a s C h a i r m a n m u c h l a t e r on. 26 27 57 Q 28 A 29 Did W h e n was that? I d o n ' t know that. B u t at o n e s t a g e t h e y s o l d o u t i n C a y m a n to s o m e b o d y a n d I t h i n k Mr. Traynor 1 2 I u n d e r s t o o d t h a t h e w a s a s k e d t o s t a y o n a n d he 3 b e c a m e C h a i r m a n f o r a p e r i o d o f t im e . 4 Are you saying that you didn't 5 u n t i l t h e c o m p a n y s o l d t h e s h a r e s a n d he s t a y e d on. 6 A r e you s a y i n g that b e f o r e that h a p p e n e d in 1988 - ­ 7 you didn't 8 A 9 10 59 Q A 60 Q A D i d h e n o t t e l l y o u t h a t he He m a y h a v e b u t I h a v e n o r e c o l l e c t i o n of that . Did you know that he was a s s o c i a t e d w i t h the comp a n y V e r y m u c h so. He u s e d to t r a v e l f r e q u e n t l y o u t there. 61 Q 19 W h y w o u l d h e do t h a t if h e w a s n ' t a s s o c i a t e d o n t h e b o a r d of d i r e c t o r s 20 A 21 62 Q 22 A 23 in some way? You a sked me was he Chairman. He w a s on t h e b o a r d o f d i r e c t o r s y o u t h i n k ? I d o n ' t k n o w if I k n e w t h a t b u t I m a y h a v e k n o w n that. 24 63 Q 25 A 26 64 Q 27 A 28 65 Q 29 I w o n d e r w h y t h a t is. in C a y m a n ? 17 18 t h a t is t h e o n l y I h a v e n o r e c o l l e c t i o n o f tha t . 15 16 I d o n ' t k n o w w h e t h e r I k n e w o r not, was Chairman? 13 14 k n o w t h a t h e w a s C h a i r m a n of t h e c o m p a n y ? a n s w e r I c a n g i v e to that. 11 12 k n o w he w a s C h a i r m a n Y ou knew that he was c l o s e l y a s s o c i a t e d ? V e r y c l o s e l y a s s o c i a t e d w i t h it. From the v e r y b e g i n n i n g ? From the v e r y b e g i n n i n g of what? We are sparring, are sparring. Mr. Stakelum. Yourself and myself I was just w o n d e r i n g if I c o u l d l e a d 1 y o u t o t e l l m e w h a t y o u k n o w a b o u t Mr. 2 involvement 3 a n s w e r me, 4 interview. 5 A. 6 66 Q. 7 A. 8 9 67 Q. Please tell me what you know? I w a n t t o hel p. T h e n h e l p me. Mr. T r a y n o r l e f t H a u g h e y B o l a n d i n 1 9 7 0 o r 1971. Just p au s e there: Guinness A. If y o u d o n ' t f r a n k l y t h i s is g o i n g t o b e a l o n g He w a s v e r y i n v o l v e d w i t h G u i n n e s s 10 11 so t h a t w e w o n ' t spar . T r a y n o r 's Yes, & Mahon. He w a s v e r y i n v o l v e d w i t h & Mahon? h e w a s v e r y i n v o l v e d j u s t b e f o r e h e left, and 12 t h e n he le ft. 13 got i n v o l v e d w i t h C a ym a n or f or m e d Cayman. 14 I suspect 15 i n i t i a t i v e m a y b e i n t h e f o r m a t i o n of 16 G u i n n e s s M a h o n C a y m a n Trust. 17 b e c a m e a w a r e o f t h a t. 18 m a t t e r h ow close we w ere he w o u l d n ' t d i s c u ss his 19 business things with me where they wouldn't have any 20 interest 21 aware that he was v e r y i n v o l v e d w i t h Cayman. 22 u s e d t o t r a v e l t h e r e a lot. 23 w ent on the B o a r d or w h e n he b e c a m e Chairman. 24 I a m a w a r e he w a s C h a i r m a n i n t h e l a t e r day s. 25 I c annot a n s w e r you about w h e n I b e c a m e aware he was 26 Chairman because 27 can I say about that? 28 became involved. 29 G u i n n e s s M a h o n s t a r t e d in 1971, A f t e r h e left, I d o n ' t k n o w w h e n he f r o m r e a d i n g a l o t t h a t he t o o k a m a j o r f o r me. Mr. I don't know when I T r a y n o r w a s n ' t likely, O b v i ously over the years I became He I d o n ' t k n o w w h e n he I just don't remember. What else I c a n n o t r e m e m b e r w h e n he I wouldn't no know whether 1972, 1973, 1974, 1 2 68 Q. 3 A. N o p a r t i c u l a r d a t e b u t e a r l y in t h e Yes, i n t h e 1 9 7 0 's I p r e s u m e is w h e n h e g o t i n v o l v e d 4 with Guinness 5 t h a t he g o t i n v o l v e d w i t h C a y m a n . 6 69 Q. & Mahon. a b o u t it. 8 in your p r o f e s s i o n a l 9 him? A. 11 70 Q. 12 13 Yes, Traynor Did you discuss this very major change li fe. D i d y o u d i s c u s s it w i t h as a f r i e n d I w o u l d ha v e . D i d h e i n d i c a t e to y o u t h a t as a f r i e n d he w o u l d t r y A. No, that would have been m y decision. My leaving H a u g h e y B o l a n d a r o s e f r o m a d i f f e r e n c e of o p i n i o n . 71 Q. I a m n o t a s k i n g y o u a b o u t t h a t at all. 16 w a n t to go into y o u r p r i v a t e affairs. 17 know, 18 b e a b l e t o h e l p you, 19 A. 20 72 Q. 21 No, A. 23 73 Q. 24 A. 25 74 Q. 26 d i d Mr. I don't I w a n t to T r a y n o r s u g g e s t to y o u t h a t he w o u l d put business your way? a n d h e d i d n ' t eve r. D i d yo u say to h i m that yo u w o u l d be in t o u c h w i t h him, 22 27 sometime after to help you? 14 15 So I p r e s u m e A t t h e t i m e y o u l e f t d i d y o u t a l k t o Mr. 7 10 1 9 7 0 's? that you w o u l d like his assistance? No. You didn't? No. B u t i n f a c t y o u d i d ge t h i s a s s i s t a n c e for clients of y o u r s ? A. Not specifically because I went out on m y own 28 though, 29 H a u g h e y B o l a n d & Co a n d w o u l d h a v e c o n t i n u e d a f t e r . I was getting his assistance before I left 1 B u t t h a t w o u l d h a v e b e e n t h e s a m e k i n d of a s s i s t a n c e 2 I w o u l d h a v e g o t f r o m p e o p l e in A I B e x c e p t t h a t he 3 w a s c l o s e r to m e a n d I k n e w h i m b e t t e r . 4 75 Q. V e r y well. Y o u k n e w t h e n t h a t he w a s c l o s e l y 5 associated. 6 he h e l d in t h e c o m p a n y . 7 Tr u s t , y o u k n e w t h a t it w a s a b a n k a n d y o u k n e w t h a t 8 it w a s i n v o l v e d in e s t a b l i s h i n g t r u s t s . 9 k n o w t h a t t h e t r u s t s it e s t a b l i s h e d w e r e 10 You didn't know what particular office With Guinness Mahon Cayman Did you discretionary trusts? 11 A. 12 7 6 Q. T h a t is n o t m y l a n g u a g e at all. D i d y o u kn ow; d i d y o u h e a r t ha t . It m i g h t n o t b e 13 y o u r l a n g u a g e -- it is l a w y e r ' s l a n g u a g e -- b u t d i d 14 you know that they were di s c r e t i o n a r y trusts? 15 A. I don't know w h e t h e r you are t e l l i n g me that all the 16 t rusts that G u i n ne s s M a h o n w ere i n v o l v e d in were 17 d i s c r e t i o n a r y trusts. 18 of a l l ki nd s. 19 77 Q. 20 A. 22 78 Q. 23 It g i v e s d i s c r e t i o n t o t h e t r u s t e e s . In t h a t t h e y h a v e a b s o l u t e d i s c r e t i o n to do what they like with the trust 24 A. 25 79 Q. 26 A. 27 80 Q. 29 Do y o u k n o w t h e d i f f e r e n c e b e t w e e n a d i s c r e t i o n a r y t r u s t a n d an o r d i n a r y t r u s t ? 21 28 I presume there were trusts funds? T h a t is a b i t o u t o f m y l e a g u e . H a v e y o u c o m e a c r o s s i t? I h a v e h e a r d it b e f o r e . Have any of your clients ever h a d d i s c r e t i o n a r y trusts ? 1 if t h e y d i e d o r s o m e t h i n g a n d t h e r e w o u l d b e l e t t e r s 2 of w i s h e s w i t h d i s c r e t i o n a r y trusts. 3 c a m e a c r o s s a f e w o f th o s e . 4 81 Q 5 A 6 82 Q I probably Did you yourself ever have one? No. In r e l a t i o n to t h e a c t i v i t i e s o f G u i n n e s s & Mahon 7 and the e s t a b l i s h m e n t of Guinness M a h o n Cayman 8 Trust, 9 Mr. do y o u k n o w t h a t G u i n n e s s & Mahon and T r a y n o r in p a r t i c u l a r t h e n e s t a b l i s h e d 10 subsidiaries 11 w o r k as G u i n n e s s M a h o n C a y m a n T r u s t h a d b e e n d o i n g 12 in the C a y m a n Islands? 13 A in t h e C h a n n e l Islands to do the same I d on't know that he e s t a b l i s h e d t h e m but I w o u l d 14 have met somebody from a company called "Sovereign 15 something" 16 som et i m e and t here was some c o n n e c t i o n w i t h 17 Guinness 18 ...(INTERJECTION). 19 83 Q at a g o l f o u t i n g o f G u i n n e s s & Mahon, & Mahon b u t I a m n o t t o o s u r e w h a t it A r e y o u t e l l i n g me, Mr. Stakelum, t h a t Mr. 20 did not tell you that they had e s t ablished 21 subsidiaries 22 A 23 24 in t h e C h a n n e l Traynor Islands? I a m t e l l i n g y o u t h a t I a m n o t a w a r e t h a t he certainly told me that specifically. 84 Q Y o u e i t h e r r e m e m b e r it o r y o u d o n ' t r e m e m b e r it. 25 Do y o u r e m e m b e r Mr. 26 established.. . (INTERJECTION)? 27 A 28 85 Q 29 A A s c l e a r as t h a t Traynor telling you that they I don't remember. D i d y o u l e a r n it s u b s e q u e n t l y ? I d on't know about the s u b sidiaries. 19 S u b s i d i a r y has 1 a c o n n o t a t i o n t o m e as a n a c c o u n t a n t t h a t s o m e b o d y 2 owns 3 subsidiaries 4 that they had connections 5 86 Q 6 A something. I don't know whether they owned in t h e C h a n n e l Islands. But I am aware in t h e C h a n n e l What were the connections? T h e r e w a s t h e t h i n g t h a t is m e n t i o n e d of 7 College Trustees. 8 your documentation t h a t . . . (INTERJECTION). 9 87 Q L e t us b e c l e a r . 10 College Trustees. 11 that? 12 A 13 88 Q 14 I a m n o t s u r e t h a t I r e a d it in We sent you p a r t i c u l a r s A 16 89 Q 17 A 18 90 Q 19 H a d y o u n e v e r h e a r d o f it b e f o r e I had heard the name College Trustees. L e t us ge t b a c k to t h a t; t h a t is w h a t w e a r e t a l k i n g I a m n o t a w a r e t h a t it w a s a s u b s i d i a r y . It w a s an a s s o c i a t i o n ? Yes . Guinness Channel A 21 & M a h o n h a d an a s s o c i a t i o n w i t h Islands? A b s o l u t e l y I w o u l d h a v e b e e n a w a r e of t h a t b e c a u s e wo u l d have used the facility. 22 91 Q 23 A 24 What facility w ould you have used? I r e f e r r e d to it i n m y n o t e s to y o u i n c o n n e c t i o n w i t h G e r r y Keane. 25 92 Q 26 A What facility w ould you have used? Guinness & M a h o n p r o v i d e d a c o m p a n y for me from I 27 p r e s u m e G u e r n s e y f o r t h e u s e o f Mr. 28 obviously had a connection. 29 of about? 15 20 Islands. 93 Q Keane, so t h e y I 1 Yes. 2 there was a connection. 3 94 Q I don't that Guinness 5 the Channel A I knew Tell me then what you knew about the connections 4 6 k n o w w h a t s u b s i d i a r y it is. & M a h o n I r e l a n d a n d Mr. T r a y n o r h a d in Islands? In c o n n e c t i o n w i t h Mr. K e a n e at a s t a g e w h e r e he 7 w i s h e d to p u r c h a s e a r e s i d e n c y a n d w h e r e he h a d no 8 f a c i l i t y o r b o r r o w i n g c a p a c i t y at t h e t i m e b u t h a d 9 some funds abroad, I a d v i s e d h i m i f he w i s h e d to 10 m a i n t a i n the confidentiality. 11 to use a foreign company. 12 95 Q 13 A 14 W h e r e did he h ave the funds? He h a d t h e f u n d s p l a c e d w i t h m e a n d i n t u r n I h a d p l a c e d t h e m w i t h Mr. 15 96 Q 16 A I don't know that but I always suspected until proceedings 18 Cayman but 97 Q Traynor. Where were they then? 17 19 a r o s e i n r e c e n t t i m e s t h a t t h e y w e r e in I a m n o t s u r e o f t h a t now. Mr. K e a n e g a v e y o u fu n d s . 20 Mr. Traynor. 21 t h o u g h t t h e y w e r e in C a y m a n ? 22 A 23 98 Q 24 A 25 A n d the o nl y w a y was Mr. Y o u g a v e t h e m to Traynor put them somewhere and you T h a t is r i g h t . I am asking you about the Channel T hey then p r o v i d e d a company. Islands? I a s k e d Mr. Traynor a n d he a r r a n g e d for a c o m p a n y to be provi d e d . 26 99 Q 27 A W h a t year are we t a l k i n g about? About 1988. 28 A r e y o u t e l l i n g m e t h a t b e f o r e that , 29 h e a r d of C o l l e g e T r u s t e e s ? you had never 1 A. 2 3 I don't recall the name but I think I met a guy from over.. . (INTERJECTION). 101 Q. L e t us c o n t i n u e t h i s r a t h e r l e n g t h y d i a l o g u e b y 4 asking you some more d e tailed questions. 5 n ever h e a r d of College Trustees. 6 Guinness 7 Channel 8 A. 9 102 Q. 11 A. 12 103 Q. 13 A. 14 104 Q. Companies that & M a h o n were a s s o c i a t e d w i t h in the I s l a n d s -- w h e n d i d y o u f i r s t k n o w t h a t ? P r o b a b l y at t h e s a m e t i m e I w o u l d h a v e h e a r d a b o u t the Cayman, 10 Had you I d o n ' t know. In the e a r l y 197 0 ' s ? M i d d l e t o l a t e 1 9 7 0 's m a y b e . M i d d l e to late 1 970's? I w e n t out on m y ow n just a f t e r . . . ( I N T E R J E C T I O N ) . Answer my question. T h i s is t h e m i d d l e t o l a t e 15 1 9 7 0 's t h a t y o u f i r s t r e a l i s e d o r u n d e r s t o o d t h a t 16 Guinness 17 Channel 18 A. & M a h o n h a d a s s o c i a t i o n c o m p a n i e s in t h e Islands? I c a n n o t b e as s p e c i f i c as th a t . I u n d e r s t a n d that 19 I a m u n d e r o a t h h e r e a n d I c a n n o t b e as s p e c i f i c as 20 that. 21 not w a n t i n g to be u n h elpful, 22 105 Q. 23 A. 24 1 0 6 Q. I am not sure w h e n I l e a r n e d that. I do, absolutely. Tell me what you u n d e r s t o o d these companies that Guinness 26 Channel A. 28 29 I a m j u s t n o t sure. Y o u w a n t to b e h e l p f u l ? 25 27 & M a h o n were a s s o c i a t e d w i t h in the Islands. What were they? Evidently one was College Trustees. I don't know h o w l o n g t h a t is in e x i s t e n c e . 107 Q. T h a t is That was one company. Any other companies? 1 I t h i n k f r o m y o u r d o c u m e n t a t i o n t h e r e is a 2 Guinness 3 & Mahon Channel 4 y e a r s ago. 5 there was a Guinness 6 p r o b a b l y d e a l t in b a n k i n g s i t u a t i o n s a n d m a y b e 7 C o l l e g e T r u s t e e s a c t e d in s e c r e t a r i a l 8 I am not p o s i t i v e a bout e i t h e r of t h o s e things. 9 T h e r e w a s a S o v e r e i g n s o m e t h i n g or o t h e r . & M a h o n s o m e t h i n g o r ot h e r , Islands. maybe Guinness I m a y have h e a r d of that But I don't recall. A n d I p r e s u m e if & Mahon Channel Islands, situations. I met 10 t h i n k t h e m a n a g i n g d i r e c t o r o f t h a t at a 11 Guinness 12 t h e y did. 13 work. I don't D i d Mr. T r a y n o r n e v e r t a l k to y o u a b o u t t h e s e 14 108 Q 15 & M a h o n golf outing. it I don't know what T h e y m a y have done trusts, secretarial k n o w w h a t t h e y m i g h t h a v e don e . companies ? 16 A 17 109 Q 18 A No. Never? No, t h e o n l y t i m e h e t a l k e d to m e i n d e t a i l w a s o n e 19 t i m e h e c a m e a r o u n d t a l k i n g at a t i m e w h e n he h a d 20 a c q u i r e d o r h a d a s m a l l p e r c e n t a g e of a c o m p a n y in 21 Cayman. 22 the Cayman. 23 110 Q 24 A 25 26 I He t a l k e d a b o u t d i s e n g a g i n g h i m s e l f f r o m I am t a l k i n g about the Channel I h a v e no r e c o l l e c t i o n o f h i m t a l k i n g t o m e a b o u t the Channel 111 Q 27 A 29 112 Q Islands. D i d he e x p l a i n to you w h y t h e y h a d to be established? 28 Island companies? No. 1 2 113 Q 3 Did you know that there were exchange control difficulties ? 4 A 5 114 Q 6 A 7 115 Q No. Did you ever hear that? That he h a d e x c h a n g e No, ...(INTERJECTION). that there were exchange control difficulties 8 w hich meant that Guinness 9 establish subsidiaries 10 A 11 116 Q 12 A 13 117 Q 14 15 I wouldn't in the C h a n n e l Islands? k n o w that . I a m w o n d e r i n g d i d he e v e r t e l l y o u t h a t ? No, never. Did you ever ask him why they had established companies A & M a h o n d e c i d e d to No, in the C h a n n e l I don't Islands? k n o w t h a t h e e s t a b l i s h e d c o m p a n i e s in 16 the Ch a n n e l 17 l o n g b e f o r e De s T r a y n o r a n d m a y b e t h e y h a d them . 18 118 Q Alright, Islands. Guinness I w i t h d r a w that. & Mahon was there I a p o l o g i s e t o y o u fo r 19 c o n f u s i n g you. 20 Mr. 21 I r e l a n d e s t a b l i s h e d s u b s i d i a r i e s o r c o m p a n i e s in t h e 22 Channel 23 A 24 119 Q 25 A 26 120 Q T r y n o w a n d g e t it c l e a r . Tr a y n o r e x p l a i n to you w h y Gu i n n e s s Did & Mahon Islands? No. He d i d n ' t ? No. Apart f r o m Mr. Traynor, w h o w a s a f r i e n d o f yo u r s , 27 w i t h w h o m d i d y o u h a v e d e a l i n g s w h e n y o u w e n t to 28 Guinness 29 A & M a h o n on b e h a l f o f c l i e n t s ? 1 s o m e t i m e l a t e r w h e n he j o i n e d G u i n n e s s 2 D e f i n i t e l y Pa t O ' D w y e r w h o w a s a b a n k i n g m a n a g e r . 3 P r o b a b l y M a r t i n Keane. 4 John Guinness 5 W i l l i a m F o r w o o d at a l a t e r s t a g e b u t it h a d n ' t 6 a n y t h i n g to do w i t h h i s r o l e in G u i n n e s s & Mahon. 7 In f a c t h e m i g h t h a v e e v e n l e f t G u i n n e s s & M a h o n at 8 t h e t i m e. 9 121 Q 10 A 11 122 Q I had dealings with I c a nnot r e m e m b e r a n y o t h e r names. If t h e y w e r e p u t t o m e I m i g h t . Try. I w i l l p u t a n a m e t o y o u in a m i n u t e . Will 13 it t o y o u ? A at o n e st a g e . Pender. Y ou cannot r e m e m b e r any o t h e r names. 12 14 Michael & Mahon. B u t we se e if y o u c a n r e m e m b e r it w i t h o u t m e p u t t i n g There was John Guinness; he was Chairman. 15 T h e r e w a s De s T r a y n o r h i m s e l f c e r t a i n l y . 16 Maurice O'Kelly. 17 Maurice O'Kelly; 18 W i l l i a m F o r w o o d was in G u i n ne s s 19 w a s t h e r e I d o n ' t t h i n k I h a d a n y d e a l i n g s w i t h him. 20 But I had dealings with hi m subsequently. 21 M a r t i n Keane. 22 123 Q 23 A 24 124 Q 25 A But not m u c h d e a l i n g w ith that w o u l d h a v e b e e n m u c h later. & M a h o n b ut w h i l e he Padraig Collery. Padraig Collery, Yes, There was you had dealings wit h him? I did. T e l l us a b o u t t h a t. Do y o u k n o w w h a t h i s r o l e w a s ? M y v i e w o f it w a s t h a t h e w a s a k i n d of a n a s s i s t a n t to Des Traynor. 26 27 125 Q 28 A 29 126 Q How often would you have met him then? Se v e r a l t imes o v e r the years. S u r e l y m o r e t h a n tha t, 25 Mr. Stakelum, surely more 1 2 3 I thought 127 Q 4 5 A l o t of t i m e s . A That w ould dep e n d upon what client was d oing what a n d w h e r e a n d w he n . 128 Q T a k i n g an average, 8 Guinness 9 Once a week? 10 Over a year how often would you have met him? 6 7 s e v e r a l w a s a lot. A h o w o f t e n w o u l d yo u go into & M a h o n a n d see some of t h e s e people. T h e r e c o u l d b e t i m e s t h e r e w h e n y o u c o u l d b e in 11 t h r e e t i m e s a w e e k a n d t h e n yo u m i g h t not be in for 12 three months. 13 M a h o n I w o u l d h ave h a d little, 14 with Padraig Collery because I would have been 15 dealing mostly with Guinness & Mahon. W h e n De s T r a y n o r w a s i n G u i n n e s s 16 129 Q W i t h De s T r a y n o r ? 17 A W i t h De s T r a y n o r , 18 130 Q W h e n y o u w o u l d g o i n t h r e e t i m e s a w e e k fo r pa r t i c u l a r clients, 20 w o u l d be seeing? A to do yes. 19 21 if a n y t h i n g , & that w o u l d be Des T r a y n o r you M o s t l y m y d e a l i n g s w o u l d b e w h e r e Mr. Traynor would 22 be the Principal. 23 financial a r r a n g e m e n t s or something, 24 d e a l i n g w i t h M a r t i n K eane a nd g o i n g b a c k for f urther 25 information. 26 131 Q 27 28 29 A B u t i f y o u w e r e i r o n i n g out you c ould be W h e n Mr. T r aynor left the b a n k you were then dealing w i t h Mr. Collery, Yes. is t h a t i t? I c a n t h i n k of a c o u p l e of s p e c i f i c s i t u a t i o n s w i t h Mr. Collery thereafter. 1 In r e l a t i o n to y o u r a s s o c i a t i o n t h e n w i t h 2 Guinness 3 c o n s u l t a n c y work. 4 with Guinness 5 M a h o n to o r g a n i s e 6 s o r t or a n o t h e r f o r c l i e n t s ? 7 A 8 133 Q 9 & Mahon, you have d e s c ribed your general Is t h a t t h e r e l a t i o n s h i p y o u h a d & Mahon, that you went to G u i n n e s s financial assistance, loans of one T h at's right. This w o u l d have b e e n a s i t u a t i o n where sometimes you w o u l d be in r e g u l a r l y t h r e e t i mes a w e e k an d 10 sometimes 11 position? 12 A 13 134 Q a gap of m o n t h s w o u l d elapse, Wa s this an i m p o r t a n t c o n n e c t i o n f r o m y o u r p o i n t of v i ew , 15 fact that you w e r e able to get loans 16 b e h a l f of c l i e n t s 17 an i m p o r t a n t A is t h a t t h e Absolutely. 14 18 & your connection with Guinness from Guinness & M a h o n a nd the for c l i e n t s on & Mahon. Was this aspect? It w o u l d b e v e r y i m p o r t a n t . W h e n you are 19 e n d e a v o u r i n g t o g e t l o a n s t h e p e r s o n a l c o n n e c t i o n is 20 of the u t m o s t importance, 21 135 Q 22 A 23 136 Q I would have thought yes. so. It is m o s t i m p o r t a n t . W o u l d I be c o r r e c t in s a y i n g that in m o s t c a ses you 24 w o u l d h a v e f i r s t g o n e to G u i n n e s s 25 y o u c o u l d g e t l o a n s f o r y o u r c l i e n t s r a t h e r t h a n to 26 some other financial institutions? 27 No, 28 The clients w o u l d p r o b a b l y of t heir own v o l i t i o n 29 have their own bank. & M a h o n t o s e e if I don't think that w ould be correct necessarily. You w ould deal with their own 1 2 137 Q. If t h e c l i e n t n e e d e d f u n d s a n d w a s n ' t a b l e to g e t 3 it, 4 try Guinness 5 A. y o u w o u l d a d v i s e t h e m a n d y o u w o u l d a d v i s e to I might. & Mahon, w o u l d you? Y o u w o u l d g e n e r a l l y t r y at t h e b a n k w h e r e 6 they were doing business. 7 awkward financing, 8 Guinness 9 would have used Guinness & Mahon, If t h e r e w a s m o r e w i t h t h e g o o d c o n n e c t i o n in c e r t a i n l y in the e a r l i e r days & M a h o n a fair b it for 10 clients because 11 yo u c o u l d t a l k to the m a n a g i n g d irector. 12 138 Q. T h a t is w h a t I I h a d this e n t r e e to Des T r a y n o r and I w ould have thought. In r e l a t i o n to 13 t h e m r e q u i r i n g s e c ur i t y for loans d i d you come 14 a c r o s s a n y s u g g e s t i o n s m a d e in r e l a t i o n t o s e c u r i t y 15 for the us e of A n s b a c h e r d e p o s i t s or d e p o s i t s b y 16 Guinness 17 the b a n k or o t herwise? 18 A. & M a h o n in G u i n n e s s M a h o n C a y m a n T r u s t in I n d e a l i n g w i t h t h e b an k , I w o u l d want to e m p hasise 19 t h a t yo u w o u l d n ' t get a n y t h i n g out of Des T r a y n o r 20 that wasn't proper banking approval. 21 knew hi m there were n ' t any conces s i o n s that w o u l d be 22 m a d e t o me. 23 prop o s i t i o n that wasn't b ankable more quickly than 24 he m i g h t a s t r a n g e r . 25 1 3 9 Q. 26 A. I He w o u l d tell m e w h e r e to go w i t h a I am asking you about security? I a m l e a d i n g i n t o tha t, Mr. Costello. 27 q u e s t i o n of security, 28 t o is a q u e s t i o n o f b a c k - t o - b a c k s . 29 Because On the I t h i n k what you are ref e r r i n g 1 there. 2 a c c o u n t s -- a l t h o u g h I a m w e l l a w a r e of t h e m - ­ 3 e x c e p t f o r o n e i n c o n n e c t i o n w i t h Mr. 4 r e f e r r e d to. 5 s u r e t h a t is t h e s o l e b a c k - t o - b a c k o n e b e c a u s e 6 c e r t a i n t h i n g s h a v e b e e n s u g g e s t e d at s t a g e s a l o n g 7 t h e wa y. 8 a b a c k - t o - b a c k situation. 9 140 Q 10 A I don't have recollections I h a v e to say, of b a c k - t o - b a c k Keane that I I cannot be a b s o l u t e l y I was p e r s o n a l l y o p p o s e d to ever u t i l i s i n g W h y was that? Because I h a d to d e a l w i t h t h e c l i e n t , some on a 11 d a y - t o - d a y basis. 12 if a n y o n e o p e r a t e d a b a c k - t o - b a c k s i t u a t i o n t h e 13 c l i e n t b e l i e v e d t h a t t h e r e w a s n o m o n e y due. 14 h a d £ 1 0 0 , 0 0 0 a n d h e b o r r o w e d £ 1 0 0 , 0 0 0 u p fro nt , 15 da n g e r was that he gets into t h i n k i n g that the 16 £ 1 0 0 , 0 0 0 d o e s n ' t h a v e to b e p a i d b a c k b e c a u s e it is 17 backed. 18 141 Q There was a great t e n d e n c y that T h a t is a d i s a s t r o u s financial If h e the situation. I think you u n d e r s t a n d from our letter and p robably 19 from elsewhere that I am not just c o n c e r n e d about 20 o rdinary back-to-back situations, 21 a b o u t A n s b a c h e r d e p o s i t s b e i n g u s e d as s e c u r i t y fo r 22 l oans g i v e n to y o u r c l i e n t s ? 23 A 24 T h a t is w h a t I am concerned I r e f e r to as b a c k - t o - b a c k , t h a t is t h e s e c u r i t y o n t h e b a c k i n g t o t h e f r o n t loan. 25 142 Q 26 A 27 143 Q But the s e c u r i t y was an A n s b a c h e r d e p o s i t ? T h a t ' s right, yes. W h e n yo u are t a l k i n g a bout b a c k - t o - b a c k loans, we 28 are b e i n g specific, 29 w o u l d have h a d a s e c urity for loans w h i c h Guinn e s s we are t a l k i n g about clients who & 1 Mahon ha d g i v e n ; a d e p o s i t w h i c h was i n t h e name o f 2 Ansbacher in f o r m e r name, 3 Mahon Cayman T r u s t 4 From my p o i n t 5 the funds th a t I w ould have had p l a c e d w i t h 6 Mr. Traynor. I wouldn't 7 A nsbacher or C o l le g e T r u s t e e s 8 144 Q 9 A 10 1 45 Q its perhaps as Guinness and l a t e r A n s b a c h e r ? o f view i t But t h e y w ere o u t s i d e the would o n l y be l e t us s a y know w h e t h e r t h e y w e r e or J e r s e y or what. jurisd iction ? That' s r i g h t . What we a r e t h e n t a l k i n g about i s f u n d s w h i c h yo u 11 h a d d e p o s i t e d on b e h a l f o f c l i e n t s w i t h Mr. 12 w hich were o u t o f t h e j u r i s d i c t i o n and w h i c h were 13 b e in g used as 14 A 15 16 secu rity I am o n l y a w a r e o f i t for loans to your c l i e n t s ? i n one s i t u a t i o n . have been o th e r s but I c e r t a i n l y d o n 't 146 Q T h e r e may recall. What we a r e d i s c u s s i n g now a r e l o a n s w h i c h w e r e 17 s e c u r e d i n t h e way we h a v e b e e n d i s c u s s i n g . 18 does 19 part of the 20 was a r r a n g i n g t h e t r a n s f e r o f 21 who d e p o s i t e d t h e m o f f s h o r e , 22 A 23 147 Q 24 A That's service that you gave t o your c l i e n t s f u n d s t o Mr. is that Traynor correct? correct. When d i d t h a t start? I am i n c l i n e d t o b e l i e v e 197 6 b u t i t 1977. 26 I o n l y had one y e a r o f o p e r a t i o n s 148 Q But i t a p p e a r f r o m w ha t y o u h a v e b e e n t e l l i n g me t h a t 25 27 Traynor m ight have been I w o u l d h a v e s t a r t e d on my own i n l a t e Would y o u t e l l in 1975. 1975. u s w ha t t h e a r r a n g e m e n t i n a g e n e r a l 28 way was w i t h Mr. 29 operated? Traynor. How was t h i s service 1 If 2 a s k e d me t o 3 cases 4 I w o u l d h a v e a s k e d Mr. 5 the 6 clien t 7 t r a c k i n g r o u t e o r a c c o u n t name o r c o d e o r w h a t e v e r 8 th e y might b e. 9 149 Q I can t a k e a t y p i c a l that look a f t e r funds th a t T r a y n o r t o a d v i s e me w h e r e would i s s u e in stru ction s C o u l d y ou n o t b e a l i t t l e 11 e x p l a i n i n g them t o us? If in alm ost a l l funds m ight be t r a n s f e r r e d t o , y o u know t h e s e A a c l i e n t may h a v e I am a w a r e o f w e r e a l r e a d y a b r o a d . 10 12 example, the c l i e n t terms, a nd t h e n t h e when I g o t t h e b i t more s p e c i f i c b e c a u s e I don't wished to p la c e know. the Would y o u m i nd f u n d s w i t h me and 13 t h e y w e r e i n some R o y a l Bank o f S c o t l a n d i n J e r s e y 14 or w herever. 15 1 50 Q 16 A 17 1 51 Q 18 A 19 152 Q 21 A 22 1 53 Q 23 o f yours? Why w o u l d t h e y w a nt t o p l a c e f u n d s w i t h y o u? T he y m i g h t b e u n h a p p y a b o u t m o n i t o r i n g t h e s e n s e o f w h at i n t e r e s t funds in r a t e . . . (INTERJECTION). B u t y o u w e r e n o t a b an k? No. T he y w e r e a s k i n g y o u r a d v i c e a s t o w h e r e t o p u t t h e A T he y w e r e a s k i n g me w h e t h e r I c o u l d m o n i t o r t h o s e f u n d s on t h e i r b e h a l f . 154 Q M onitor i s a wo rd y o u u s e ; 27 Your c l i e n t s 28 What do t h e y a s k y o u t o do? 29 their funds ? 25 26 clien t's Yes . the 20 24 This i s A I d on 't understand i t . h a v e f u n d s an d t h e y come i n t o Th e y w o u l d s a y 'We h a v e f u n d s o f f s h o r e ' 31 you. wherever 1 th e y might have been 2 fo r me.' 3 1 55 Q 4 5 "Can y o u l o o k a f t e r t h e s e A Would y o u e n d e a v o u r t o g e t Would y o u m o n i t o r t h e 156 Q Take i t slow ly. 8 in terest 9 where t h e i r 10 11 funds." these funds What d i d t h a t mean? 6 7 'Can y o u l o o k a f t e r rate. the b est in terest rate. funds. Would y o u e n d e a v o u r t o get the b est Were t h e y a s k i n g y o u t o fu n d s were i n t o some o t h e r change fin an cial institu tion ? A I d o n ' t t h i n k t h e y w o u l d come i n a n d s a y 12 funds. 13 fin an cial 14 have a r o s e w i t h them t h a t 15 that 16 after 17 157 Q 18 A 'We h a v e W i l l y o u c h a n g e t h e m f o r some o t h e r in stitu tio n .' t h e y h a d £X i n these I t h i n k a d i s c u s s i o n would t h e y w o u l d h a v e a d v i s e d me f u n d s a nd s a y 'Can y o u l o o k f u n d s on my b e h a l f . ' What d o e s t h a t mean? I t m e ans t h a t t h e y m i g h t n o t w a nt t o correspond 19 d i r e c t l y w i t h w h a t e v e r f o r e i g n bank t h e y were u s i n g . 20 T he y m i g h t n o t w a nt t o g e t m a i l r e c e i v e d 21 f o r e i g n b a n k s on t h e b a s i s 22 T he y w o u l d n ' t 23 lo o k in g at whether the 24 o n e m ont h o r t h r e e m o n t h s o r s i x m o n t h s . 25 t h e y w o u l d l i k e me t o l o o k a f t e r t h o s e 26 What d i d y ou do t h e n ? 27 I w ould p r o b a b l y a d v i s e them a t 28 t h e r e would be a f a c i l i t y 29 Guinness feel & Mahon. f r om o f m onthly s ta te m e n ts . that n e c e ssa r ily competent about fu n d s s h o u l d be p l a c e d factors. some s t a g e available And t h a t through that 1 159 Q 2 A 3 1 60 Q 4 5 Yes . You u s e d t h e wo r d " f a c i l i t y . " in t h is A connection? I t m e ans I w o u l d p r o b a b l y h a v e c o n t a c t e d 6 Des T r a y n o r . 7 -- 8 were - - 9 by me.' 10 1 61 Q I would have s a i d D o n ' t u s e d t h e wo r d " m o n i t o r e d " b e c a u s e 12 What i s means. h e t o do? Des T r a y n o r i s t o g i v e me an a c c o u n t n umb e r, reference, 15 the 16 bank t o have t h e 17 I d o n 't understand th e se 18 m ov ed t o a r e c e i v i n g b a n k . 162 Q a bank where t h e very im portant. I understand even l e s s . 21 clien t 22 that th is 23 Mr. A with is to his Those fu n d s - ­ things eith er -- m igh t be I f you d o n ' t u n d e r s t a n d i t , Let us t a k e funds in J e r s e y . clien t a who w o u l d h a v e in stru ction s funds moved. 20 24 clien t funds would have t o g i v e This i s I don't You h a v e a c l i e n t . 14 19 know who my c l i e n t s t h a t w ish e s t o have funds m o n itored abroad u n d e r s t a n d w h at i t A 'I have a c l i e n t f o r t h e m o s t p a r t he w o u l d n ' t 11 13 What d o e s t h a t mean a typ ical You t e l l d issa tisfied . Mr. Traynor What d o e s T r a y n o r t h e n do? He g i v e s me c o d e d r e f e r e n c e s . 25 it 26 Lo ndo n f o r 27 What was t h e b a nk ? 28 Mr. 29 in stru ction s m ig h t w e l l be a r e f e r e n c e s o and s o , C ostello, I don't reme mbe r b u t t o a bank a c c o u n t for the account of in s o and s o . I d o n ' t re me mbe r a n d I am s u r e t h o s e would have v a r i e d over t h e years. 1 What was t h e 2 t o be p l a c e d ? 3 A account, I have a d i f f i c u l t y i n w h o s e name was t h e a c c o u n t answering th a t 4 w a n t in g t o be u n c o o p e r a t i v e . 5 t h a t Mr. 6 under h i s 7 1 65 Q 8 9 control and t h e r e You m u s t h a v e known t h e is not I am s a y i n g i s Traynor would be s e e k i n g t o which your c l i e n t s ' s A A ll question, get the funds a transfer process. finan cial in stitu tio n in fu n d s were g o i n g t o be p l a c e d ? The o n l y a n s w e r I c a n g i v e to that is I don't recall 10 because over the years they probably used d if f e r e n t 11 fin an cial 12 16 6 Q T e l l me some o f t h e m t h a t w e r e u s e d t h a t 13 Mr. 14 names o f 15 A in stitu tio n s. It Traynor w ould have t o l d is some o f t h o s e , very d i f f i c u l t Mr. you a b o u t . Stakelum? under o a th , but l e t 16 Guinness 17 But i f 18 p r o b a b l y be a c c o u n t o f s o and s o , 19 so e t c . 20 that. 21 If 22 167 Q 23 24 it was G u i n n e s s etc.. It & Mahon L on do n, I don't it know. would reference was d o l l a r s it finan cial v a r y d e p e n d i n g on t h e s o and of currency. might be so m eth in g e l s e . in stitu tio n d i d he t e l l you t h e m one y was g o i n g t o b e d e p o s i t e d i n ? I don't know, I just don't 25 once-off 26 w o u l d d e p e n d on w h e r e t h e 27 too. 28 Do y o u r b e s t . 29 us t r y But I am n o t a b s o l u t e l y p o s i t i v e could a ls o What o t h e r that A & Mahon London f o r a s t a r t . it G i v e me t h e in stru ction . know. I don't I t w ould be a know. I t probably f u n d s w e r e c o m i n g f r om I am s u r e y o u a r e u n d e r s t r a i n , 1 in stitu tio n s 2 d e p o s it e d as a r e s u l t 3 Mr. 4 I just 5 be u n c o o p e r a t i v e , 6 169 Q 7 A 8 1 70 Q 9 10 11 clien ts o f y o u r s h a d mone y o f your c o n ta c t w ith Traynor? cannot answer t h a t . Why c a n ' t I just That i s c a n n o t r e m e mb e r . How do I a n s w e r a q u e s t i o n o f why I c a n n o t r emember? For e x a m p l e , were any o f t h e funds l o d g e d i n any o f th e Guinness & Mahon s u b s i d i a r i e s I don't think so. But I t h i n k t h e in itia lly 13 G u i n n e s s Mahon Cayman, 14 maybe f o r t h e a c c o u n t i n G u i n n e s s 15 Guinness 16 You w o u l d g e t 1 71 Q & Mahon D u b l i n . sp ecific I am n o t t o o o f f s h o r e b a n k we a r e t a l k i n g 20 Cayman T r u s t , 21 been lodged in i t s 22 its 172 Q 25 A 26 1 73 Q & Mahon i n L on d o n . about, t h e Ansbacher bank. account i n London? I t may w e l l have been, sure. in stru ction s. 19 24 & Mahon London f o r I t may h a v e b e e n t h e a c c o u n t o f G u i n n e s s account account of r e f e r e n c e number s o and s o , D ublin or G uinness A f u n d s would be l o d g e d s o m e w h e r e maybe f o r t h e 18 23 i n Cayman o r i n Islands? 12 17 not w anting to y o u remember? t h e Channel A that & Mahon i n Was t h i s Guinness the & Mahon T he y w o u l d h a v e i n D ublin or lo d g e d in I don't r e m e mb e r. B u t y o u a r e u n d e r o a t h now? T hat' s r i g h t . You a r e u n d e r o a t h . Can y o u s a y t h a t funds your 27 clien t 28 l o d g e d i n an a c c o u n t i n t h e name o f G u i n n e s s Mahon 29 Cayman T r u s t i n ha d a s k e d y o u i n r e l a t i o n to D u b l i n o r i n London? assistan ce were 1 I c a n n o t r e m em b er . 2 in stru ction s 3 th e b e s t req u irem en ts o f th e Guinness 4 what t h e i r 5 A few m i n u t e s ago you t o s a i d t o me t h a t 6 Mr. a nd t h a t 7 f u n d s t o h i m and t h e y w e r e t r a n s f e r r e d o f f s h o r e , 8 th at not r ig h t. 9 m i n u t e s ago? 10 A 11 1 75 Q 13 A internal 14 176 Q most o f t h e 15 w ere o f f s h o r e . 16 to 17 A 18 177 Q 19 A you t r a n s f e r r e d is already. I t h o u g h t we a l r e a d y you t h i n k ? funds were o f f s h o r e funds o f th e s e you w i t h you gave a b o u t a c l i e n t . . . (INTERJECTION). T he y w e r e o f f s h o r e the & Mahon b a n k , D i d n ' t y o u s a y t h a t t o me a f e w T he y w e r e p r o b a b l y o f f s h o r e A ll some o f t h e . . . (INTERJECTION). Traynor i n s t r u c t i o n s Yes, that g i v e n a t t h e t i m e w o u l d b e w h a t was a t w ere t a l k i n g 12 I suspect clien ts already. we a r e t a l k i n g D i d yo u e v e r h a v e c l i e n t s funds th a t w e r e n 't about coming i n offshore? Yes . What w o u l d h a p p e n t h e n ? At d i f f e r e n t stages, in the ea r ly stages I think 20 I r i s h po unds c o u l d be c o n v e r t e d w i t h o u t an y p r o b l e m 21 into 22 1970's. 23 178 Q 24 A 25 179 Q 26 A S terlin g. It is o n e an d t h e same i n t h e Then t h e y c o u l d b e m ov ed f r o m S t e r l i n g . Were t h e y p u t o f f s h o r e , the funds? Yes . Where ? A ll I know i s t h a t w i t h Des T r a y n o r I w o u l d h a v e 27 a s s u m e d G u i n n e s s Mahon Cayman T r u s t , 28 Ansbacher. 29 C ollege Trustees But i t later co u ld w e l l have been or Guinness & Mahon G u e r n s e y . 1 1 80 Q 2 A 3 1 81 Q Yes, I assume one or t h e o t h e r . Did any o f your c l i e n t s 4 trusts 5 Mr. 6 Channel I s la n d s ? 7 A 8 182 Q 9 A No. 10 1 83 Q Mr. 11 A 13 184 Q 14 None o f t h e m t o l d Traynor d i d n ' t A 1 85 Q 19 A 21 186 Q 28 29 tell t h e y had done t h i s ? y o u t h a t h e was g o i n g t o c e r t a i n on t h a t such t r u s t s . I f they d id n 't Yes, estab lish who t r a n s f e r r e d th at's or a r e you d o u b t f u l that I am n o t a w a r e o f a n y trusts, you a r e aware o f funds o f f s h o r e ? right. We w i l l b r e a k now f o r a c up o f c o f f e e , Mr. Stakelum, fo r about te n m inutes 23 27 you t h a t I am n o t a w a r e c e r t a i n l y o f a n y c l i e n t s clien ts 20 26 or in th e about i t ? th a t did. 25 i n t h e Cayman I s l a n d s t o them? You a r e p r e t t y 17 24 & Mahon w i t h No. estab lish ed 22 o f Guinness N o t t o my k n o w l e d g e . 16 18 assistan ce Traynor e i t h e r suggest th is 12 15 with the t o your knowledge e s t a b l i s h SHORT ADJOURNMENT or so . 1 2 3 I want t o clarify 4 my m i n d . In t h e 5 made i t 6 transfer 7 ab o u t a r e c e i v i n g bank where t h e y have what t h e y 8 ca ll 9 from A t o B t h e r e s o m e t h i n g Mr. la st b it Hayes has b r o u g h t t o o f evidence c l e a r t h a t when I was t a l k i n g of funds t o a bank, a "routing." I may n o t h a v e about the I was r e a l l y t a l k i n g I f you a r e t r a n s f e r r i n g is often funds an i n t e r m e d i a r y b a n k t h a t 10 takes 11 referrin g 12 c o u l d v a r y e a c h t i m e on t h a t . I w o u l d n ' t h a v e known 13 what t h e were any d ay . 14 w ould be t r a n s f e r r e d 15 the 16 Then t h e y w o u l d come u n d e r t h e 17 Des T r a y n o r and t h e y w o u l d t r a n s f e r t h e m on f u r t h e r . 18 That i s 19 187 Q sp ecific funds. I d id n 't 21 lik e in stru ction s in stru ction s control of t o a sk you, Ms. Ma c ke y now w o u l d a s k y o u some q u e s t i o n s . MS. MACKEY: Mr. 24 questions 25 your r e s p o n s e t o our l e t t e r ? a b o u t Ms. B anotti. Stakelum, I would t o a s k y o u some Do y o u h a v e a c o p y o f I do. 27 If I could r e f e r 28 of 11th October 29 h ad t o a bank r o u t i n g . lik e A clien t The y t h e norm. 23 26 w h a t I was The i n s t r u c t i o n s from w h e r e v e r t h e S t a k e l u m a t t h e mome nt . to That i s know. I h a v e no f u r t h e r q u e s t i o n s Mr. 188 Q to that f u n d s on h i s 20 22 the routing of the you t o t h a t . (EXHIBIT 1 ) ? That i s your l e t t e r 1 1 90 Q. You s a y u n d e r t h e h e a d i n g 2 " P a r t One: 3 H a v i n g r e a d Ms. you..." B anotti's evidence to 4 5 I w ill 6 r e la te d to three 7 P a r l i a m e n t made p a y a b l e t o Ms. 8 somehow o r o t h e r e n d e d up i n t h e a c c o u n t o f 9 G u i n n e s s Mahon Cayman T r u s t r e C o l l e g e just recall t o your mind t h a t t h e cheques from t h e European 10 Guinness 11 a s k e d h e r a b ou t them t h a t 12 Ansbacher account but th a t 13 after her o f f i c e 14 after her e l e c t i o n 15 that 16 you t h e s e 17 cheques 18 r e i m b u r s e y ou f o r & Mahon. in the Ms. evidence B a n n o t t i which Trustees in B a n n o t t i t o l d u s when we in fact s h e h a d no your firm , BEL, looked a nd a d m i n i s t r a t i o n h e r e i n D u b l i n t o t h e E u r o p e a n P a r l i a m e n t and course of th at sh e must have p a s s e d t o European P a r l i a m e n t cheques, f o r ex p e n se i n c u r r e d by her, services w hich were in order to you c a r r i e d o u t f o r h e r . 19 20 You s a y : 21 " H a v i n g r e a d Ms. B a n o t t i ' s e v i d e n c e t o you I can c o n f i r m t h a t h e r e v i d e n c e i n r e l a t i o n to her c o n tr a c tu a l r e l a t i o n s h i p w i t h my co mpa ny i s c o r r e c t ." 22 23 24 F irst 25 that 26 of a ll. 27 t h e European P a r li a m e n t ? 28 29 A. No. of a ll I would l i k e contractual Did i t I am n o t t o a s k you a b i t relation sh ip . begin b efore When i t 1984? began f i r s t s h e b e c a m e a member o f s u r e on d a t e s b u t I g u e s s h a v e b e c o m e a member i n about she might 1 1 91 Q 2 A I t would have been im m e d ia te ly a t t h a t t im e . 3 E v i d e n t l y i n t h e European s t r u c t u r e 4 is 5 Parliam ent to have a s e c r e t a r i a l 6 t h e co mpa ny t o w h i c h e x p e n s e s a r e p a i d b y t h e 7 European P a r lia m e n t . 8 expenses to the 9 Ms. necessary B anotti. in d ivid u als 14 1 93 Q at the tim e. W h e t h e r t h a t was I am n o t sure. A s ig n e d c o n t r a c t between? Between B u s in e s s E nterprises Can I a s k y o u how s h e f i r s t L t d an d Mary B a n o t t i . came i n c o n t a c t w i t h y o u A Yes. I t was t h r o u g h a p l a c e c a lle d the 17 R utland C entre which i s 18 Fr. 19 He i s 20 K e n n e d y C r o w l e y & Co. 21 F r . S h o r t n e e d e d somebody, 22 in 23 Fr. 24 explain h is 25 d if f e r e n t m odality of treatm ent. 26 h a v i n g a m e e t i n g i n Ms. 27 I didn't 28 o f u s met i n h e r h o u s e . She h a d a s m a l l h o u s e . Not t o c u t you s h o r t , Stakelum, 29 . o r how y ou me t h e r ? 15 16 to T h e r e was a c t u a l l y a s i g n e d c o n t r a c t re p e a te d each s e s s i o n or n o t, A which i s t h a t w ould be a i d e s 11 13 c om pa ny , T he y d i s c h a r g e t h e p a r t i c u l a r I know i n e x i s t e n c e 192 Q was and s t i l l f o r t h e Members o f t h e E u r o p e a n 10 12 it 194 Q S h o r t was t h e dead s i n c e . an a l c o h o l t r e a t m e n t c e n t r e . founder o f th a t I worked w i t h h i s brother in The b r o t h e r r a n g me a nd s a i d h e was g e t t i n g some s u b j e c t w i t h t h e b r o t h e r s S h o r t r a n g me. organisation. in volved in Donegal. He came up t o t h e h o u s e t o concept of a treatm ent ce n tr e . know Mr s. I t was a He s a i d we a r e B a n o t t i' s house. B anotti at the tim e. Mr. Five or s i x b u t p e r h a p s we 1 can s h o r t 2 t h r o u g h s o m e t h i n g t h a t h a d no c o n n e c t i o n w i t h t h e 3 b usiness 4 None w h a t s o e v e r . 5 1 95 Q 6 A 7 Yes. at a ll th is a little b it. 196 Q 9 A 10 in the beginning? some l o n g t i m e b e f o r e h e r e l e c t i o n ? The r e a s o n I w o u l d know t h a t 197 Q I h a d known h e r f o r f i v e A 14 198 Q 15 A or s i x D i d s h e t h e n u po n h e r e l e c t i o n 1978. T hat's look a f t e r ad m inistration? righ t. That i s Yes. a sk you t o how t h a t b e g a n ? There w ould have b e e n a r e a s o n i n t h e that 17 the 18 me. 19 her house. 20 I would have h e lp e d her o r g a n i s e 21 in Sandymount. it lead a l i t t l e sense that in to her p erson al one n i g h t sense finances after a m e etin g she rang She was v e r y d i s t r a u g h t ; she had a b r e a k - i n I said 'You h a v e t o l e a v e o f your c l i e n t s 24 adviser? I don't in area.' She was o n e in your c a p a c i t y as a f i n a n c i a l know t h a t s h e w o u l d g o down a s a c l i e n t , 26 w o u l d g o down a s a f r i e n d . 27 fo r her at th a t 28 t h a t when s h e w e n t i n t o 29 was l o o k i n g for the in a home l o a n i n AIB You w e r e d e a l i n g w i t h h e r p e r s o n a l l y . 23 A I years p rio r to 16 199 Q because s h e b e c a m e . . . (INTERJECTION). her o f f i c e 13 25 is You h a d known h e r f o r some l o n g t i m e p r i o r t o t h i s ? before 12 22 You met h e r t h i n k we s t a r t e d t h e R u t l a n d C e n t r e i n 8 11 Was t h i s circu it stage, I just but i t the she arranged a loan was k i n d o f n a t u r a l P a r l i a m e n t a n d when s h e s o m e b o d y s h e came t o u s . 1 200 Q 2 Was t h a t t h e only f in a n c ia l p rior to taking 3 A 4 201 Q 6 members o f 7 b eh alf. 9 202 Q business? T h is a r r angem ent t h a t you had f o r l o o k i n g a f t e r h er office A Yes, and a d m i n i s t r a t i o n costs, Was t h a t how i t th at's righ t. Did you t h e n s e n d h e r an i n v o i c e 11 own f e e s ? 13 203 Q 14 A on h e r was d o n e ? w h a t e v e r y o u r e x p e n s e s a nd c o s t s A d i d you pay t h e s t a f f who w e r e on h e r p a y r o l l 10 12 you g ave h e r A b solu tely. 5 8 on t h i s advice settin g out h a d b e e n and y o u r No. What was t h e a r r a n g e m e n t ? I n t h e b e g i n n i n g t h e r e was q u i t e a lot o f work. 15 w e r e w r i t i n g up h e r c h e q u e b o o k s a n d t h i n g s 16 that. 17 204 Q 18 19 A ll I am a s k i n g y o u now i s , reim bursed. A We lik e how d i d y o u g e t What d i d y o u d o . She u s e d t h e wo r d " r e i m b u r s e d . " Did you i n v o i c e her? I would have f e l t 20 that 21 C e r t a i n l y t h a t would have been th e c a s e 22 number o f y e a r s . 23 have been paid ? 24 m on e y on b e h a l f o f c l i e n t s 25 w o u l d r e c o u p t h e m one y a nd p a y . 26 I can u n d e r s t a n d t h a t , 27 incurred. 28 doing t h is ? 29 I d id not charge her a fe e ; she would have p a id us i n advance m o s t l y . for the last Whether i n t h e b e g i n n i n g I would We w o u l d n ' t g e n e r a l l y p a y o u t t h e y were t h e But d i d y o u n o t 42 and r e c o u p i t later. We e x p e n s e s y ou charge her a fe e for s h e was a c l o s e p e r s o n a l 1 friend. 2 c o l l e a g u e who t o o k i t 3 som ething. 4 such. 5 206 Q A fter a w hile, You d i d n ' t some y e a r s over, I don't think in voice 7 What was t h e a r r a n g e m e n t . 9 I brought some s t u f f from about 11 transactions 12 207 Q 13 A 14 208 Q 16 A 17 18 It is Was i t by cheque? from B u s i n e s s E n t e r p r i s e s 1991 b u t i t does for the la s t I o n ly have t h i s s ho w t h e eigh t kind of or n in e We c a n make a c o p y o f i t (EXHIBIT 4) O bviously lo ok in g now a n d g i v e back to SAME HANDED at th a t, we d i d p a y s o m e t i m e s i n T h e r e a r e some r e d f i g u r e s We u n d e r s t a n d f r o m Ms. Banotti that there. for the purposes of o ffic e 20 MEP' s , 21 d irectly 22 p a r t i c u l a r MEP an d t h a t 23 here in 24 have b e e n p a i d from t h a t bank a c c o u n t . 25 be t h e A years. it 19 26 Ltd. the o n ly copy I have. advance. 209 Q she That would be u s e f u l . you. 15 that as How d i d s h e n o r m a l l y p a y y o u . I have a copy o f her a c c o u n t. 10 s h e p a i d him Your memory i s p a i d you i n a d v a n c e . A I think I ever charged a fee her. 6 8 l a t e r my e x p e n s e s a nd a d m i n i s t r a t i o n c o s t s of t h e E u r o p e a n P a r l i a m e n t w o u l d t r a n s f e r mone y into a bank a c c o u n t Ireland. in the country o f th at sh e had su ch a bank a c c o u n t Presumably, n o r m a l l y you would Would t h a t case? I am g u e s s i n g so. I w o u ld n 't be c l o s e 27 I p r e s u m e s o a n d t h i s may s ho w t h a t . 28 On t h i s 29 e x p la in the appearance o f th e s e th ree particu lar o c c a s i o n Ms. to it. B a n o t t i can o n ly cheques in the 1 GMCT a c c o u n t b y s a y i n g t h a t 2 these 3 r e i m b u r s i n g you f o r your s e r v i c e s 4 expenses 5 t h a t happening? 6 No. I think 7 those cheques. 8 But I w o u ld h a v e t o 9 s h e was c o r r e c t . sh e must have p a s s e d t o you i n t h e c o u r s e o f p a y i n g you or or f o r your i n c u r r e d on h e r b e h a l f . I said that I don't Can y o u r e c o l l e c t know how I g o t But I c a n n o t a t a l l say th a t recollect it. the p r o b a b ility i s that What I b e l i e v e may h a v e h a p p e n e d 10 is 11 c o u l d h a v e b e e n i n my o f f i c e 12 o f m o ne y . 13 g i v e n h e r c a s h f o r t h em a nd t h e n l o d g e d t h e m b e c a u s e 14 t h e y w e r e a f o r e i g n . . . (INTERJECTION). 15 211 Q 16 A 17 18 19 20 it w a s n ' t p a y i n g any o f h e r e x p e n s e s b u t sh e I don't For c a s h , yes. in A What I am s a y i n g is that l o d g e d on t h e 213 Q that 25 such a s i t u a t i o n , 26 them? I would have s e n t to get at if it any r e c o l l e c t i o n I am t o l d t h a t t h e y w e r e s h e g a v e t h e m t o me. I u n d e r s t a n d w ha t y o u a r e s a y i n g , What I am t r y i n g A I haven't assum ption th a t 24 29 know t h a t b u t I s u s p e c t L o d g e d t he m w h e r e ? 22 28 I c o u ld have such c a s e you must have l o d g e d them. or knowledge o f t h a t but 27 am s h o r t answer. 21 23 'I h a v e e x c h a n g e d t he m? I don't t h e most l i k e l y You s a y t h a t a nd s a y i n g have any m o n e y . ' She may e s s e n t i a l l y is 212 Q that is Mr. Stakelum. w h e r e w o u l d y ou i n arose h y p o th etica lly , t h em down t o G u i n n e s s lodge & Mahon. 1 215 Q 2 A B ecau se t h e y were f o r e i g n 3 foreign 4 to 5 216 Q 6 A 8 217 Q 9 10 You w o u l d g i v e Yes. any f o r e i g n currency th at Traynor to exchange I t would be r a r e . B u t why w o u l d y o u do t h a t Because ra th er than exchange i t Why g i v e I would have c l i e n t s it t o Mr. 12 I c o u l d e x c h a n g e t h a t w i t h them. 14 A 15 219 Q 16 A 17 220 Q 19 A 20 I had t h e But i n t h i s But t h a t with the c a s e you gave i t kept i t in foreign clien t? t o Mr. Traynor? currency. That k ept i t For yo u? To e x c h a n g e for a c lie n t 221 Q By g i v i n g it t o Mr. who w o u l d w a n t t o Traynor i t change kept i t available for yo u? A Yes. If I lodged i t into been c o n v erted back in t o 25 givin g i t 26 currency. 222 Q 28 29 currency. fo r e ig n currency I could. 24 27 foreign money. 22 23 If Traynor? availab le. 18 21 You c o u l d e x c h a n g e i t in t h a t m i g h t b e g i v i n g me I r i s h p o u n d s t h a t w o u l d w a nt t h e 218 Q came y o u r f o r y o u? 11 13 as opposed I r i s h pounds. t h e o r d i n a r y wa y . A T h a t was c u r r e n c y t h a t you m ig h t t r e a s u r e way t o Mr. 7 currency. t o Mr. In o t h e r words, I r i s h pounds. Traynor you kept i t you were g i v i n g i t keep f o r you e s s e n t i a l l y , A a l o c a l bank i t is that But by in a foreign t o Mr. it? would have Traynor to 1 2 223 Q 3 A 4 5 B u t i n y o u r name? He n e v e r k e p t an a c c o u n t 224 Q What I am t r y i n g you f e l t 7 foreign 8 A 9 225 Q Therefore, it 12 Ms. 13 B e lg ia n Francs? 15 226 Q 16 was t h i s if mone y t h a t you w is h e d i n was g o i n g t o b e k e p t i n y o u r name o r If A is, Yes . 11 it was y o u r mo n e y , is that it. y o u h a d e x c h a n g e d y o u r I r i s h m o ne y f o r B anotti's B e l g i a n F r a n c s t h e y w e r e now y o u r R ight. Can y o u e x p l a i n how t h e y e n d e d up i n a GMCT account? A That would be t h e i r t h i n g . I don't 18 w ould u s e i t . 19 Cayman T r u s t o r w h a t e v e r p l a c e 20 funds. 21 assumed i n c i d e n t a l l y t h a t 227 Q 24 Cayman T r u s t ? A 26 228 Q 27 A 28 229 Q it know w h e r e t h e y Trustees th e y kept the know. or foreign I would have was Cayman T r u s t . You w o u l d h a v e a s s u m e d t h a t m on e y y o u g a v e t o Mr. 25 That c o u l d be C o l l e g e I wouldn't n e c e s s a r ily 23 29 know currency? on y o u r b e h a l f ; 14 to get at you c o u l d a g a i n a c c e s s 10 22 I don't t h a t he k e p t t h e a c c o u n t . 6 17 i n my name. T ra y n o r f o r you w ould go i n t o Foreign currency, G u i n n e s s Mahon yes. Why w o u l d y o u a s s u m e t h a t ? Because I assumed t h a t foreign currency. is whe re he k e p t a l l To u n d e r s t a n d w ha t y o u a r e s a y i n g , 46 the you w ould assume 1 that 2 look a f t e r 3 Is 4 That i s 5 230 Q you g a v e f o r e i g n f o r you, 7 A 8 231 Q 9 w h at I am s a y i n g , In o t h e r words, Mr. Yes, I am u s i n g T r a y n o r w o u l d k e e p f o r yo u mone y How c a n y ou u s e t h e p h r a s e A Because sense. " f o r you" i n a l o o s e I would have c l i e n t s anxious to get foreign currency. I understand th a t. 13 A I f h e ha d m on e y i n 14 they could a ccess 233 Q 16 foreign A 18 234 Q I understand t h a t. But t h e p o i n t What y o u w o u l d e x p e c t happened t o be i n 20 he w o u l d p u t i t 22 then is, th is is your a b o u t now? Okay. 19 A currency a v a ila b le , t h a t b y g i v i n g me I r i s h p o u n d s . m on e y t h a t we a r e t a l k i n g 17 Yes. Into if foreign into a foreign y o u g a v e y o u r m o ne y w h i c h c u r r e n c y t o Mr. Traynor, a Cayman a c c o u n t ? currency d ep osit account, p r o b a b l y Cayman. 235 Q I d o n ' t have any f u r t h e r q u e s t i o n s , 24 Thank y o u . 25 MR. JUSTICE COSTELLO 26 Mr. Mr. Stakelum. Rowan w o u l d l i k e to a s k y o u some q u e s t i o n s now 27 a b o u t Mr. 28 MR. ROWAN: 29 Cayman. yes. " f o r me" i n t h e l o o s e s t 232 Q 23 into t h a t w h a t y ou a r e s a y i n g ? 12 21 he w o u ld p u t i t Traynor to sense? 11 15 c u r r e n c y t o Mr. i n Cayman? 6 10 if Keane. Mr. Stakelum, can I ta k e 1 that 2 (EXHIBIT 2 ) . 3 i n t wo p l a c e s 4 Perhaps to 5 became a c l i e n t 6 I suspect 7 237 Q 8 A 9 you s e n t us p l e a s e , t h e one o f 22nd Septem ber T h a t d e a l s w i t h Mr. K eane's a t p a r a g r a p h 4 a n d p a r a g r a p h 7. start, can you t e l l u s when Mr. in the e a r ly 1980's. o f yours? He was i n t r o d u c e d t o me t h r o u g h a n o t h e r c l i e n t , on a g o l f course. I don't r a n g me o r s a i d t o me a t t h e t i m e a t t h e 11 would l i k e 12 d i d come a n d t a l k 14 A to What s e r v i c e s His i n i t i a l come a n d t a l k t o you' had. 17 t h e c o mp an y . 18 was an e m p l o y e e h e ha d who h a d 10%. 19 buy o u t t h e p a r t n e r . 20 the 22 A 23 240 Q 24 A b u t he o b v i o u s l y He b o u g h t o u t a p a r t n e r t h a t h e in h is co mpa ny h e r e h e ha d 45% o f A n o n - a c t i v e p a r t n e r h a d 45%. There He w i s h e d t o T h a t was my r e c o l l e c t i o n t r a n s a c t i o n w i t h Mr. So h e came t o y o u and s a i d of Keane. can you a r r a n g e a lo a n ? That' s r i g h t . How d i d y o u a p p r o a c h d e a l i n g w i t h t h a t I know t h a t Guinness 26 in the 241 Q ... As I r e c a l l 25 27 'I s e r v i c e s w e r e l o a n s t h a t he r e q u i r e d i n 16 239 Q golf d i d he e x p l a i n h e n e e d e d f r o m y o u ? con n ection with 21 I t o me. 15 first as r e c a l l w h e t h e r he 10 238 Q Keane first? Why d i d he b e c o m e a c l i e n t recall 13 affairs request? I would have r a i s e d a lo a n through & Mahon w i t h h i m . I have a f e e l i n g it was order o f £40,000. When y o u w e r e l o o k i n g a t t h e clien t's needs, 28 p r e s u m a b ly you c o u l d have r a i s e d a l o a n o f t h a t 29 t h r o u g h a n y number o f b a n k s . sort Why d i d y o u s e l e c t 1 2 O b v i o u s l y I c a n n o t reme mbe r e x a c t l y b u t h i s 3 G e r r y Ke ane L t d , 4 still 5 been su p p lyin g the needs 6 trading 7 c omp a ny i t e m , 8 buy s h a r e s 9 that 10 w o u l d h a v e b e e n d e a l i n g w i t h and d e a l s w i t h AIB L t d . fa cilities it But AIB L t d w o u l d h a v e f o r t h e c om pa ny , overdraft. the T h is w ould be n o t a would have been a p e r s o n a l ite m to in the c om pa ny . That i s the I can t h i n k o f f o r u s i n g G uinness only reason & Mahon a t th a t tim e. 11 242 Q 12 A B u t y o u c o u l d p e r h a p s h a v e u s e d Bank o f Yes, I could but e c h e lo n in Guinness 14 discuss 15 It 16 s e c t o r t o be g o in g 17 con n ection with the 18 b it 19 investm ent 243 Q unusual was a b i t unusual. unusual 23 reme mbe r b r o a d l y ? 26 A financing i f you l i k e . f r om AIB t o Bank o f Irelan d in s h a r e s o f t h e company. It is a & Mahon w e r e a more When y o u w e n t t o G u i n n e s s terms, 244 Q was e a s y t o o r i e n t a t e d bank. 22 25 to the top in t h e terms o f t h e banking Guinness advance t h i s A & Mahon w h e r e i t item s o f 21 24 Ireland? I have v e r y r e a d y a c c e s s 13 20 co mpa ny , l o a n t o Mr. secu rities, that & Mahon a n d t h e y a g r e e d t o Keane, sort did th ey require of thing. Can y o u I d o n ' t r e m e mb e r. Was i t an u n s e c u r e d l o a n ? I don't reme mbe r t h a t . 27 helpful: 28 after 29 separating But s e e i f Sometime a f t e r that, that, th is I don't he r e q u i r e d a n o t h e r l o a n . from h i s w ife. w ould be know how l o n g He was My k n o w l e d g e o r my 1 memory was t h a t h e h a d t o b o r r o w a b o u t a n o t h e r 2 £40,000. 3 s e c u r e d o r n o t b u t Mr. 4 w i t h me a t 5 So t h e extreme l i k e l i h o o d 6 outset of the 7 s e c o n d l o a n or somewhere i n b e t w e e n , 8 a c q u i r e d some o f f s h o r e 9 t h r o u g h me. 10 245 Q I don't know w h e t h e r t h e some s t a g e May I j u s t first stop and had o f f s h o r e y ou t h e r e . t o have o f f s h o r e 14 246 Q 15 A 16 17 Was i t it of the he w o u ld h a v e How s o o n a f t e r y ou Ke ane w o u l d h e h a v e s t a r t e d deposits? remember t h a t . s o o n o r was i t I suspect th a t whether at the d e p o s i t s w i t h Des T r a y n o r 12 I j u s t wouldn't is funds. loan or at the o u t s e t b e c a m e an a d v i s e r t o Mr. A o n e was Ke ane h a d b e c o m e a d e p o s i t o r 11 13 first some y e a r s ? would have been r e l a t i v e l y soon afterw ards. 247 Q On t h e o n e h a n d Mr. Ke ane was b o r r o w i n g mone y t o b u y 18 a partner in h is 19 he was p u t t i n g m o ne y o f f s h o r e 20 A 21 248 Q 22 A 23 249 Q 24 A company o u t a nd on t h e o t h e r ha nd on d e p o s i t ? R ight. Is there a contradiction there? No. Can y o u e l u c i d a t e on t h a t ? B e c a u s e he w o u ld ha ve w a n t e d t o m a i n t a i n 25 con fid en tiality 26 do t h a t u s i n g t h o s e 27 make t h e p a y m e n t s t h a t h e w a n t e d t o up f r o n t . 28 Mr. 29 about funds o f f s h o r e an d he c o u l d n ' t funds t h a t would be o f f s h o r e Ke ane h a d some mone y on d e p o s i t offshore. to 1 2 A. I am n o t s u r e . I am s u r e h e w o u l d h a v e i n t r o d u c e d 3 the to p ic 4 I . . . (INTERJECTION). 5 2 5 1 Q. at some s t a g e He h a d some f u n d s a n d h e w o u l d h a v e s a i d t o y o u a t 6 one o f your m e e t i n g s 7 Mr. 8 them w e l l 9 Is 10 A. an d a s k e d me c o u l d Stakelum, 'I have th e s e c a n y o u a d v i s e me how t o f r o m an i n v e s t m e n t p o i n t Investment is too f a n c y a word. m on e y on b e h a l f o f c l i e n t s , 12 instru ction s. 13 some c a s e s 14 sp ecifically 15 But t h a t w o u ld be t o t a l l y 252 Q. at some s t a g e s L et us c o n c e n t r a t e 18 f u n d s on d e p o s i t 19 issue 21 2 5 3 Q. 22 I didn't in vest only w ith t h e i r clien ts at th e ir sp ecifically w h a t I w a nt t o do: D i d Mr. somewhere e l s e shares. d iscretion . on Mr. Keane, which Ke ane h a v e t h e s e b e f o r e he r a i s e d t h e w i t h you? I don't think so. T h i s was an a r r a n g e m e n t w h e r e h e p r o p o s e d t o p u t m on e y on d e p o s i t ? 23 A. 24 254 Q. 25 A. 26 2 5 5 Q. That's right. He a s k e d f o r y o u r a d v i c e ? He m u s t h a v e . Woul d h e h a v e b e e n a w a r e o f t h e sorts of offshore 27 arrangements th a t 28 i n f o r m a t i o n t h a t w o u l d h a v e b e e n new t o him? 29 sp ecific a s k e d me to arrange the purchase of is A. of view .' M o n i e s w e r e on d e p o s i t p u r e l y o r i n 17 20 look a f t e r t h a t w h a t he w o u l d h a v e s a i d ? 11 16 funds, t h e r e m ight have been or i s th is 1 offshore. 2 arisen. 3 c o u ld w e ll have a r i s e n 4 was s a y i n g t h a t h e n e e d e d f u n d s . 5 to purchase the p artn er. 6 sep a ra tio n with h is 7 h a v e a d v i s e d me t h a t he h a d f u n d s o r f u n d s a v a i l a b l e 8 t o him o r w h a t e v e r . 9 256 Q 10 A 11 257 Q 12 13 I don't I am n o t saying t h i s is s u b j e c t would have how i t did, Yes, i n a d i s c u s s i o n w h e r e b y he w ife. The f i r s t Subsequently the And he p r o b a b l y w o u l d You w o u l d h a v e g i v e n him a d v i c e . What w o u l d t h a t a d v ic e have been? A I don't know w h a t a r r a n g e m e n t s h e m i g h t h a v e h a d o r 15 that 16 Guinness 17 h is behalf. 258 Q 19 if he w i s h e d , I w o u l d h a v e t o l d him I p r e s u m e the fu n d s c o u l d be p l a c e d t h r o u g h & Mahon a nd I w o u l d l o o k a f t e r the Would y o u h a v e i n d i c a t e d t o h im t h a t t h e f u n d s on f u n d s would have gone o f f s h o r e ? 20 A 21 259 Q Presumably but I t h i n k h e w o u l d h a v e known t h a t . Would he h a v e a s k e d y o u w h e r e o f f s h o r e t h e y would 22 h a v e g o n e when y o u p l a c e d t h e m w i t h G u i n n e s s 23 on h i s A No, I don't t h i n k a n y o f my c l i e n t s But I t h i n k t h a t 26 that 27 260 Q 28 A it aware & Mahon. im p ly t h a t would have g i v e n them c o m fo r t ? I think i t had c l o s e ever asked th a t . t h e y would have been w e l l was g o i n g t h r o u g h G u i n n e s s D oe s t h a t No, & Mahon behalf? 25 29 o n e was presum ably. m ight not have had. 24 but i t And a s k e d f o r a d v i c e a s t o how t o d e a l w i t h t he m? 14 18 know how t h e im plies that t h e y were aware t h a t c o n n e c tio n s w ith Guinness & Mahon. I The y 1 w e r e p r o b a b l y a w a r e o f G u i n n e s s Mahon Cayman T r u s t 2 or G uinness 3 We a r e t a l k i n g 4 do y o u s a y t h a t 5 c a n i n f e r Mr. 6 known a b o u t G u i n n e s s Mahon Cayman T r u s t a n d t h i n g s 7 lik e 8 now? 9 A that. & Mahon. a b o u t Mr. you b e l i e v e We a r e t a l k i n g I would s u s p e c t 11 handled through Guinness 12 would have assumed t h a t 13 Ca y ma n. 15 A 16 263 Q 17 18 about th e A I if early 1980's he a s k e d c o u l d & Mahon. As I s a i d , I t h e y were h a n d l e d t h r o u g h You w o u l d h a v e p r o v i d e d t h e m w i t h t h e inform ation? Presum ably. Whic h o f c o u r s e was i n f o r m a t i o n y o u i n t u r n w o u l d Yes. & Mahon? When y o u s a y " o b t a i n e d " it was j u s t know ledge. 20 264 Q 21 A 22 But you g a i n Yes, I was a w a r e o f Mr. Cayman. 265 Q k n o w l e d g e f r o m some s o u r c e ? When i t Traynor' s involvem ent with He was t r a v e l l i n g f r e q u e n t l y t o Cayman. was e s t a b l i s h e d t h a t it was s u i t a b l e 24 Mr. K e a n e ' s m on e y t o b e p l a c e d o f f s h o r e 25 Mr. Traynor, 26 Mr. K e a n e ' s name? 27 and i f I would s a y t h e y c o u l d be have o b t a i n e d from G u in n e ss 19 23 funds be h an d led , clien ts, Why would have n e c e s s a r i l y t h r o u g h me t h a t these 262 Q that Ke ane i n t h a t , 10 14 Ke ane s p e c i f i c a l l y . A d i d y o u a d v i s e Mr. for through Traynor o f I d o n ' t re me mbe r t h a t . 28 But w i t h y o u r b e s t 29 At some s t a g e . estim ate? I t may h a v e b e e n t h e 53 second loan 1 t h a t he n e e d e d i t 2 w o u ld n 't have e s t a b l i s h e d t h a t . 3 a d v i s e d Mr. 4 know w h e t h e r t h a t was f o r t h e 5 subsequent 6 We a r e g o i n g on a l i t t l e 7 The s i t u a t i o n 8 negotiab le 9 Ke ane and w o u l d y o u h a v e p a s s e d t h a t is cheque or d r a f t 12 Mr. 268 Q 15 Traynor. A 17 269 Q first or t h e p r e s u m a b l y f r o m Mr. over to T r a y n o r h a v e known t h a t or whatever i t was, was on b e h a l f o f Traynor would have i n d i c a t e d t o y o u w h e r e h e was Ke an e ? Probably n o t. Mr. No, on d e p o s i t ? not at th at p o in t. Would y o u h a v e b e e n a w a r e f r o m Mr. Traynor as to w h e r e he was t h e n g o i n g t o d e p o s i t t h i s 19 th e Guinness A seco n d or f a s t e r than I want. 18 20 I don't t h a t you would have g o t a Would Mr. going to put i t 16 t h e r e were f u n d s . instrum ent or cheque, 11 14 We may t h e n h a v e loans. Mr. A His c r e d i t w o r t h i n e s s Traynor t h a t 10 13 for. If & Mahon o r g a n i s a t i o n ? I was a s k e d t h a t q u e s tio n a year ago, 21 have s a i d y e s , 22 Mahon Cayman T r u s t . 23 arisen 24 been. 25 Mahon Cayman T r u s t , 26 whether i t 27 G u i n n e s s Mahon Cayman T r u s t , 28 those 29 At t h i s that mone y w i t h i n I would presume i t I would was G u i n n e s s But s u b s e q u e n t m a t t e r s h a v e l e a d s me t o q u e s t i o n w h e r e i t I t was o f f s h o r e b u t w h e t h e r i t was i n whether i t might have was G u i n n e s s was i n J e r s e y , Dublin in th e acco u n t o f I don't know a n y o f factors. p o i n t Mr. T r a y n o r may n o t h a v e known 54 1 Mr. 2 b e c a u s e you d i d n ' t 3 deposited? 4 A. K e a n e ' s name and Mr. That i s if the Ke ane w o u l d n o t h a v e known know w h e r e h i s m o ne y was b e i n g sequence o f even ts is as I say. 5 Mr. 6 l o a n had a l r e a d y b e en r a i s e d b e c a u s e t h e r e would 7 h a v e b e e n a f r o n t up l o a n . 8 w h e th e r he had 9 was r a i s e d w i t h hi m o r n o t . T r a y n o r w o u l d h a v e known Mr. K e a n e ' s name i f But I d o n ' t know funds o f f s h o r e b e f o r e th e Mr. a first loan Traynor g e n e r a l l y 10 w a s n ' t a w a r e o f my c l i e n t s 11 h o t c h p o t c h a c c o u n t w i t h him. 12 B u t w h e r e t h e r e was a s i t u a t i o n w h e r e t h e y h a d t o 13 back-to-back 14 p r e s u m a b l y do some a d j u s t m e n t on t h e i r 15 do t h a t 16 2 7 1 Q. it was a g e n e r a lly w asn't. t h e y w ould accounts to and t h e y w o u l d h a v e t o b e a w a r e . So t h a t y o u d o n ' t m on e y w e n t i n t o 18 your d e s c r i p t i o n A. It f u n d s on a s e c u r i t y , 17 19 name s b e c a u s e I suspect it know w h e t h e r i n f a c t Mr. the hotchpotch account, did. Keane's which i s of it? But t h e n t o t h e exten t that 20 b o r r o w in g s were n eeded t o be s e c u r e d by t h a t , 21 p r e s u m a b l y t h e b a n k may h a v e m ov e d i t . 22 272 Q. 23 The h o t c h p o t c h a c c o u n t w o u l d h a v e b e e n i d e n t i f i e d b e i n g an a c c o u n t o f y o u r s ? 24 A. 25 2 7 3 Q. That's right. So t h a t Mr. Ke ane w o u l d h a v e d e p o s i t e d m on e y w i t h 26 you t o be p u t o f f s h o r e 27 correct? 28 A. 29 274 Q. from tim e t o t i m e , is that R ight. How o f t e n m i g h t h e h a v e h a d m on e y t o d e p o s i t , can as 1 2 No. 3 275 Q 4 A Annually? I would s u s p e c t i n t h e e a r l y d a y s maybe more t h a n 5 annually. 6 f r om w h e r e v e r h e g o t i t . 7 all. 8 276 Q 9 it the d i f f i c u l t y 11 A 12 277 Q 13 years not at m i g h t h a v e b e e n s o m e t h i n g t o do w i t h w ith h is w ife or som ething l i k e that? Yes . At t h a t p o i n t w ha t h a p p e n e d . say A But i n l a t e r B u t i n e v e n t h e came b a c k f o r a s e c o n d l o a n . You i n f e r r e d 10 14 I t m i g h t b e w h e n e v e r he g o t t h e mone y 'We w o u l d l i k e I don't Did G u in n e s s & Mahon to change th e a rr a n g e m e n ts.' know b u t t h a t is certa in ly p ossib le that 15 th e y might have s a i d 16 some s t a g e h e h a d t wo l o a n s w i t h G u i n n e s s 17 one o f about £ 9 0 , 0 0 0 18 One b e i n g h i s p e r s o n a l l y a nd o n e b e i n g t h e 19 company's, 20 arisin g 21 borrowed to pay h i s p a r tn e r . 22 borrowed to pay h i s w ife as p a rt o f a s e t t l e m e n t . 23 278 Q 24 A ...M y r e c o l l e c t i o n G e r r y Keane L t d . firstly Secondly, funds funds The o t h e r o n e was a compa ny t r a d i n g l o a n t h a t h e a l o n g t h e way I s u s p e c t h i s 27 as p a r t A & Mahon, I understand th a t. 26 29 at His p e r s o n a l l o a n f r o m t wo m a i n t r a n s a c t i o n s , w ould have had w i t h G u in n e s s 279 Q that and a n o t h e r o f a b o u t £ 9 0 , 0 0 0 . 25 28 is & Mahon. offshore So me whe re funds were u sed security. How d i d t h a t issue get raised? I t may h a v e b e e n r a i s e d on t h e b a s i s 56 of the level of 1 b o r r o w i n g s t h a t h e was r i s i n g 2 know when h i s 3 I t may h a v e b o r r o w e d and i n c r e a s e d a l o n g t h e way. 4 I don't 5 have s a i d t h a t 6 I don't 7 may h a v e b e e n l a t e r 8 it was. It is 9 280 Q Guinness know. sort on. I don't of thing that for th e ir 281 Q Of c o u r s e . Would t h a t make i t the 15 o r was i t 16 request, the I don't know. A t h e y w ould l o o k cover? 14 17 know a t w h at s t a g e a b a n k w o u l d do 11 13 security. I t may h a v e b e e n v e r y e a r l y on o r i t w h e n e v e r b o r r o w i n g s w e r e g o i n g up, A exactly & Mahon m i g h t t h e y n e e d e d some a d d i t i o n a l 10 12 I don't compa ny w o u l d h a v e b o r r o w e d t h e m o ne y . know a t w ha t s t a g e the to. issue lik ely t h a t Mr. Traynor r a i s e d w i t h y ou when y o u me t hi m on some o c c a s i o n s o m e t h i n g w h i c h was p r o m p t e d b y t h e application I suspect fo r a second loan? that t h e l o a n s were 18 r e v i e w e d g e n e r a l l y on an a n n u a l b a s i s 19 a nd a t 20 w rite 21 it 22 said that 23 n e c e s s a r y or w hatever. 24 d i s c u s s i o n w h e r e t h e y p r e s u m a b l y s o u g h t a nd l o o k e d 25 for 26 282 Q 27 A 29 283 Q some s t a g e maybe i n t h e r e v i e w t h e y w o u l d t o C l y d e Road b e c a u s e we w o u l d h a v e a r r a n g e d on b e h a l f o f h i m . at T he y may h a v e w r i t t e n and review sta g e t h e r e are repayments And t h e r e w o u l d h a v e b e e n a funds t h a t were o f f s h o r e to back th e security. So t h e b a c k - t o - b a c k a r r a n g e m e n t was p r o p o s e d b y Mr. 28 w it h t h e banks Traynor? Presum ably. How was i t effected? 1 I am n o t s u r e . 2 is 3 hotchpotch account. 4 w ould l e a v e 5 I don't 6 Would y o u h a v e b e e n a d v i s e d o f a n y m ov eme nt o f 7 monies out o f th e h o tc h p o tch account? 8 A 9 10 s i m p l e way t h a t you a g r e e d t o move s u c h f u n d s a s w e r e n e e d e d o u t o f t h e I c a n n o t reme mbe r t h a t t h e y them t h e r e , b u t t h e y m ig h t earmark them. know. I would. Mo st d e f i n i t e l y I w o u l d h a v e t o be ad vised . 285 Q 11 12 But t h e Because i t was an a c c o u n t i n your or your company's name? A No, n o t my o r my c o m p a n y ' s name. T h e r e was 13 p r o b a b l y a c o d e name b u t I c a n n o t reme mbe r c o d e 14 names f r o m t h o s e d a y s . I am f i n i s h e d i n 15 Guinness & Mahon a l o n g t i m e a nd I d o n ' t 16 what t h e c o d e names w o u l d h a v e b e e n . 17 286 Q 18 19 G i v e me a f l a v o u r o f t h e Was i t a five-d igit c o d e o r s o m e t h i n g more o r s o m e t h i n g l e s s ? A No, it w o u l d b e an i n i t i a l 20 try in g to r e c o lle c t 21 It 22 t h e y would have u se d . 23 code. remember 287 Q but a nd a n um b e r . I c a n n o t r e a l l y do i t . c o u l d h a v e b e e n B7 o r M10. Then t h e r e was t h e o t h e r s i d e I don't know wha t of course, 24 the 25 i n v o l v e d Mr. 26 Mahon. 27 Yes, 28 not 29 c e r t a i n l y b r o u g h t down t o G u i n n e s s arranging o f the I am second loan . w h i c h was That w ould have Ke ane i n some p a p e r w o r k w i t h G u i n n e s s & No rma l l o a n a r r a n g e m e n t s p r e s u m a b l y ? t h e r e w ould be normal l o a n a r r a n g e m e n t s . s u r e b u t t h e r e were c l i e n t s that I am I would have & Mahon. 1 Mr. 2 he c o u l d h a v e come t o my o f f i c e 3 paperwork t h e r e . 4 you w ould have t h e u s u a l t h i n g : Memorandum and 5 A rticles that. 6 288 Q 7 A 8 289 Q 9 A 10 290 Q Ke ane i s n ' t b i g on p a p e r w o r k . and c o m p l e t e d In c o n n e c t i o n w i t h t h e of A ssociation a nd a l l But w o u ld you h a v e s o r t e d a l l Yes, I have a f e e l i n g I w o u l d t e n d t o do a l l th is stuff company out? that. And a c t a s an i n t e r m e d i a r y w i t h t h e b ank ? Yes . G o i n g on t o t h e second r e fe r e n c e in your l e t t e r 11 (EXHIBIT 2) 12 o f your l e t t e r 13 residence 14 He h a d s e p a r a t e d f r om h i s 15 a r r a n g e m e n t was t h a t 16 the 17 years 18 he w i s h e d t o p u r c h a s e a r e s i d e n c e 19 I f o r g e t t h e name o f i t . 20 b orrow ing c a p a c i t y here t o borrow th e 21 w o u l d b e a b a n k a b l e p r o p o s i t i o n b u t he h a d o f f s h o r e 22 funds. 23 for a couple o f y ea rs. 24 anyway a t 25 Mahon a s b e i n g t o o d e a r b u t h e o b v i o u s l y w a s n ' t 26 d e a l i n g w i t h them a t t h i s 27 his 28 con fid en tiality I a d v i s e d a g a i n s t b u y i n g b u t h e was 29 k e e n t o do i t . He w o u l d h a v e t o u s e an o f f s h o r e in where you d i s c u s s Mr. K eane's d e s i r e Ireland. f a m i l y home. at th e top o f page to purchase a How d i d t h a t w ife. s h e was l e f t 4 issue arise? I think part of h is in p o ssessio n I t h i n k he l i v e d of for a couple of i n apartm ents or r e n t e d accommodation. Then o f f W a t e r l o o Road. He d i d n ' t h a v e a funds th a t I a d v i s e d him a g a i n s t b u y i n g t h e p r o p e r t y some s t a g e offshore funds. I am n o t s u r e on d a t e s , I t o o k h im o u t o f G u i n n e s s stage. & He w a n t e d t o u s e In o r d e r t o p r e s e r v e h i s 1 c om p a n y . 2 hi m c o u l d he p r o v i d e an o f f s h o r e 3 th is 4 P roperties. 5 bought t h i s 6 rental 7 in to 8 291 Q 9 10 Mr. Then I w e n t t o Mr. through Guernsey. T r a y n o r a nd I a s k e d company. T h a t was t h e B e e s l e y I t was a r r a n g e d t h a t B e e s l e y P r o p e r t i e s p r o p e r t y and Mr. Keane w e n t i n t o arrangement w ith B e e s le y P r o p e r t ie s Incorporated? A He s u g g e s t e d t h a t w o u l d b e t h e m e t h o d a nd p r e s u m a b l y 12 sh elf 13 292 Q 14 A c o mp a n y. I presume i t came o f f a som ewhere. T h a t was t h e I don't compa ny r e g i s t e r e d i n Guernsey? know t h a t b u t I t h i n k i t would have been 15 p r o v id e d by 16 Guernsey. 17 Th e y may h a v e u s e d a G u e r n s e y co mpa ny o r 18 o t h e r . . . (INTERJECTION). 293 Q 20 The p o i n t . . . I t may b e C o l l e g e T r u s t e e s b u t I t would have been p r o v id e d by Guernsey. I was t r y i n g t o g e t Channel I s l a n d s A a t was t h a t it C e r t a i n l y p r o v id e d by t h e Channel I s l a n d s . h a v e b e e n some o t h e r j u r i s d i c t i o n 23 ap p ro p ria te but i t 24 Channel I s l a n d s . 25 Presumably r e c o g n i s i n g t h a t , 26 t h e r e was some s o r t 27 Channel I s l a n d s 28 deposits were? was a company? 22 29 and w e n t Traynor s u g g e s t e d B e e s l e y P r o p e r t i e s t h a t was t h e 21 a occupation. 11 19 He d i d I t might c ompa ny t h a t was would have been p r o v i d e d by th e you r e c o g n i s e that o f c o n n e c tio n between a company an d w h e r e Mr. Keane's 1 b e i n g h a n d l e d b y Mr. Traynor through G uinness 2 Mahon, connections. 3 presumed t h a t 4 Channel I s l a n d s . 5 wouldn't 6 2 9 5 Q. 7 A. 8 2 9 6 Q. 9 A. 10 297 Q. 11 A. 12 298 Q. 13 A. 14 2 9 9 Q. 15 A. Mr. through t h e i r T h e r e may h a v e b e e n b u t t h a t follow . Stakelum, B eesley acquired the property? B eesley acquired the property. U sing as a b a c k - t o - b a c k No, using the Using the actual f u n d s on d e p o s i t ? funds. f u n d s on d e p o s i t ? Not b a c k - t o - b a c k . He r e n t e d t h e h o u s e f r o m B e e s l e y ? Yes. Sometime a f t e r w a r d s he d e c i d e d t o buy t h e h o u s e ? Yes, about 18 m o n t h s l a t e r I think. w ould have d e c i d e d t h a t 17 d e v e l o p e d where he would have t h e 18 do i t . 3 0 0 Q. 20 A. 22 3 0 1 Q. 23 A. later A p p r o x i m a t e l y how much a f t e r p r o p e r t y d i d Mr. 21 I think i t a situ ation funds a v a i l a b l e to Keane d e c i d e t o b u y i t ? tran saction know. A ll arranged? I can t e l l you i s 25 had a l o t 26 are concurrent w ith th o se th in g s 27 w e l l have b een. 29 because B eesley acquired the were t r a n s a c t i o n s 302 Q. The r e a s o n he was a b o u t 18 m o n t h s . How was t h a t I don't is 24 28 I w o u ld n 't have t h e r e was a d e p o s i t t h e n w i t h t h e 16 19 & th a t did take p la c e . t o do w i t h i t . You s a i d e a r l i e r t h a t Mr. I don't that there I would have know w h e t h e r t h e y o r n o t b u t t h e y may Ke ane when he was f i r s t 1 2 3 That' s r i g h t . 303 Q 4 A y e a r and a h a l f l a t e r he d i d have t h e b o r r o w in g capacity? 5 A 6 304 Q 7 A Yes . So h e b o r r o w e d f r o m s o m e o n e t o do t h a t ? I c a n e x p l a i n why I t h i n k t h a t h a p p e n e d . 8 exactly 9 stage sure o f the d a te s . he owed G u i n n e s s I know t h a t I am n o t a t one & Mahon a b o u t £ 2 9 0 , 0 0 0 . One 10 was t h e co mpa ny t r a d i n g 11 n o r m a l l y w i t h AIB. 12 his 13 out the oth er 14 w ay . 15 share c a p i t a l , 16 c a l l e d G e r r y Ke ane H o l d i n g s L t d f o r £ 1 8 0 , 0 0 0 w h i c h 17 was t h e v a l u e 18 c o i n c i d e d w i t h w h at t h e n e e d s w e r e . 19 G e r r y Keane H o l d i n g s L t d owed G e r r y Ke ane £ 1 8 0 , 0 0 0 20 b e c a u s e he h a d s o l d h i s 21 owne d t h e 22 I g o t AIF t o a d v a n c e £ 9 0 , 0 0 0 23 Ltd, 24 Gerry Keane, 25 Guinness 26 off 27 that p a r tic u la r 28 l o a n t o AI F a nd 18 m o n t h s l a t e r h a d s u f f i c i e n t 29 paid o f f shares. situ ation . He was t r a d i n g I a r r a n g e d f o r Mr. He owned a l l the shares; Ke ane t o sell h e ha d b o u g h t 10% s h a r e h o l d e r s o m e w h e r e a l o n g t h e To s e l l all his shares, w h i c h was 100% o f t h e i n G e r r y Ke ane L t d t o of the shares a company sh ares at th a t tim e but a ls o shares At t h i s to th is stage company. i n G e r r y Ke ane H o l d i n g s He of course. t o G e r r y Ke ane H o l d i n g s w h i c h G e r r y Keane H o l d i n g s L t d p a i d t o who p a i d o f f h i s p e r s o n a l o v e r d r a f t & Mahon. I also t h e co mpany b o r r o w i n g s . thing, got loans But j u s t in f r o m AIF t o p a y to sta y with h e t h e n was r e p a y i n g t h a t f o r hi m t o b o r r o w a n o t h e r £ 9 0 , 0 0 0 by of it 1 G e r r y Ke ane H o l d i n g s L t d f r o m AIF a nd h a v e t h a t 2 e x t r a £ 9 0 , 0 0 0 p a i d t o h i m w h i c h he u s e d t o b u y t h e 3 house. 4 it 5 When Mr. 6 P r o p e r t i e s was t h e r e a n y i s s u e 7 control? 8 A 9 Subject to the d a tes, operated w ell. No. Ke ane was b u y i n g t h e h o u s e I fail to buying i t . 11 non-resident 12 think i t 13 resid en t here. 306 Q 15 16 would a r i s e or a r e s i d e n t Do I c o n c l u d e 18 where i t 307 Q d id n 't m atter. from your answ er t h a t it would have a r i s e n . would have a r i s e n it; I wouldn't I don't see that th is 21 make a p a y m e n t t o a n o n - r e s i d e n t 22 S t a t e . (EXHIBIT 3) . 23 for £98,000 24 P roperties 25 is 26 Lane. 27 C e n t r a l Bank f o r e x c h a n g e c o n t r o l 28 w o u l d h a v e made t h a t an e x c h a n g e c o n t r o l It S terlin g. of St. is is You c a n application to of the on b e h a l f o f G e r a r d Keane The p a y e e i s Peter Port, d e s c r i b e d here as th e s a l e This see there. Can I show y o u a d o c u m e n t w h i c h we h a v e . is as a o f exchange co n tro l? 20 29 I don't you d i d n o t g i v e I w o u l d n ' t h a v e g i v e n much t h o u g h t t o have thought A ll from a e v e r m a t t e r e d when h e was b u y i n g i t much t h o u g h t t o t h e i s s u e A there. He was p e r s o n a l l y W h e t h e r he was b u y i n g i t 17 19 s e e where i t from B e e s l e y about exchange he was b u y i n g was t h e p r o p e r t y . 10 14 t h a t was t h e t h i n g and B eesley Guernsey. o f 54, The p u r p o s e Heytesbury an a p p l i c a t i o n w h i c h was made t o t h e if approval. you d i d n ' t ? Who 1 a n y th in g about exchange c o n t r o l . 2 understand t h i s . 3 application 4 O'Connell S t r e e t , 5 308 Q Name a nd a d d r e s s made t o A "N ational I am n o t even o f which Irish Bank, Dublin 1." T h e r e s e e m s t o b e some c o n t r a d i c t i o n s your r e c o l l e c t i o n 6 7 is I don't in th is o f the s itu a tio n ? sure o th e r than i t a p p e a r s t o b e an 8 a p p l i c a t i o n under exchange c o n t r o l A cts t h a t 9 c e r t a i n l y h a v e no memory o f . 10 309 Q 11 th is 12 A 13 310 Q 14 15 The p o i n t about i t is, y o u h a v e no r e c o l l e c t i o n None w h a t s o e v e r . What i s the I never heard o f t h a t. I don't 17 AIB, 18 before 19 O'Connell S t r e e t . 20 N ational 21 to t e l l you t h e t r u t h . 22 payee. Is 23 t o do s o m e t h i n g ? O'Connell I don't Street I knew h i m . Irish know. e v e n know w h e r e He h a s d e a l t w i t h fo r donkey's years, probably We d e a l t w i t h AIF a nd AIB, I never heard o f a th in g with Bank. that Irish in th is? t h e y a r e on O ' C o n n e l l S t r e e t . 311 Q of contradiction? I h a d n ' t u n d e r s t o o d f r om y o u t h a t N a t i o n a l 16 24 I application? Bank p l a y e d a p a r t A f r om I don't e v e n know w h a t t h i s The name a nd a d d r e s s o f an a p p l i c a t i o n b y B e e s l e y P r o p e r t i e s We w i l l n o t s p e c u la t e because tim e i s 25 g o i n g o n, 26 your c l i e n t s m ight have a v a i l e d o f th e w ithdraw al 27 s e r v i c e w h i c h Mr. 28 29 A R ight. Mr. is Stakelum. From t i m e t o t i m e some o f Traynor o p er a te d ? 1 I would s u s p e c t n o t . 2 was t h e 3 o f f s h o r e b u t t h e n g o t b o r r o w i n g s p r o b a b l y up t o t h e 4 extent 5 been in a withdrawal 6 it. reverse. I t h i n k Mr. I t h i n k Mr. Keane h a d some f u n d s o f w h at h e h a d o f f s h o r e I don't s o he w o u l d n ' t h a v e situation u n til h e came o u t o f th in k so. 7 313 Q I d o n ' t have any f u r t h e r q u e s t i o n s . 8 314 Q MR. JUSTICE COSTELLO Mr. 9 Thank y o u . Stakelum, th ere are one or two m a t t e r s 10 to clarify. 11 it is 12 A 13 315 Q 14 I wa nt These docum ents you have g i v e n u s , Mary B a n o t t i (EXHIBIT 4 ) ? Yes . It s e e m s t o b e r u n n i n g f r o m J a n u a r y 1 9 9 1 down t o 1998? 15 A 16 316 Q 17 A 18 That i s only because th o se are the records Where d i d y o u h a v e t h a t I have. record? T h a t was i n B u s i n e s s E n t e r p r i s e s L t d c l i e n t ' s account. 19 317 Q 20 A 21 Where d i d y o u g e t I got i t it now t o p r o d u c e t o u s ? from B u s i n e s s E nterprises Ltd C l i e n t ' s Account Ledger. 22 318 Q 23 A 24 319 Q 25 A 26 Where i s that That i s ledger l e d g e r now? is a t my h o u s e . You h a v e a l e d g e r . What d a t e d o e s i t r u n f rom? It 1 9 91 i s one t h e r e seems t h a t about the first for Mary B a n o t t i . 27 320 Q A ll your o th e r c l i e n t s 28 A No, not in the 29 K eane's p o s i t i o n clien ts. would be i n t h a t , sense of talk in g would t h e y ? about o f f s h o r e 1 3 2 1 Q. 2 A. 3 322 Q. 4 A. 5 Not o f f s h o r e clien ts? No. Where a r e t h e y ? Th e y w o u l d h a v e b e e n I r i s h b a n k s . . . (INTERJECTION). 6 3 2 3 Q. 7 A. 8 324 Q. 9 A. 10 3 2 5 Q. 11 A. 12 3 2 6 Q. 13 A. 14 327 Q. 15 A. 16 328 Q. 17 A. 18 3 2 9 Q. 19 A. 20 3 3 0 Q. 21 A. What i s t h e name o f t h i s B usiness That i s n ' t clien ts what i s it called? Ledger. who w o u l d h a v e o f f s h o r e funds? No. What l e d g e r was t h a t called? I d i d n ' t have a le d g e r . That i s a t e c h n i c a l term. You h a d a r e c o r d ? I had a month by month r e c o r d , You k e p t t h a t , a schedule. d i d you? Yes. N o b o dy e l s e in your o f f i c e kept i t ? No. Where a r e t h o s e r e c o r d s ? Th e y a r e a l l g o n e and d e s t r o y e d . When d i d y o u do t h a t , Mr. Stakelum? Th e y t e n d e d t o b e d e s t r o y e d a s s o o n a s t h e y w e r e no longer needed. 23 if 24 e x c h a n g e d e i t h e r wa y . 25 clien ts 26 any s t a g e 27 accou n t was. 28 the 3 31 Q. ledger; E n t e r p r i s e s Ltd C l i e n t ' s 22 29 funds h e ld in My a r r a n g e m e n t w i t h c l i e n t s I g o t o r g a v e t h em m o ne y , used i t t h e r e was no r e c e i p t They were a t l i b e r t y in d iffe r e n t w ay s - - to and f i n d o u t w h a t t h e b a l a n c e -- and r i n g up a t on t h e i r But t h e t e n d e n c y w o u l d b e t o d e s t r o y records w ithin When was t h e was t h a t last some m o n t h s e a c h m o n t h . t im e you had any r e c o r d s of these 1 2 Up t o maybe 1 9 9 8 . 3 332 Q 4 A A ll gone. 5 333 Q Mr. Stakelum, It is a ll gone s i n c e as 1998? I told y o u we h a v e t o m e e t a g a i n 6 b e c a u s e we h a v e t o e x a m i n e now t h e i n f o r m a t i o n t h a t 7 you have g i v e n u s . 8 b u t t h e week a f t e r . 9 p ossible 10 interview . 11 A 12 334 Q 13 to That i s fix fortn igh t. I was w o n d e r i n g i f it was a d a t e s o t h a t we c a n r e s u m e t h i s Would W e d n e s d a y , great, Very w e l l I was s u g g e s t i n g n o t n e x t w e e k t h e 22nd s u i t y o u? yes. then. Say t e n o ' c l o c k t h i s Thank y o u , Mr. day Stakelum. 14 15 THE INTERVIEW WAS THEN ADJOURNED TO WEDNESDAY, 16 22ND NOVEMBER 2 0 0 0 17 18 19 20 21 22 23 24 25 26 27 28 29 Gmmims Sa?dkocx \a ?oo UNDER OATH ON WEDNESDAY, 6TH DECEMBER 2 0 0 0 I hereby c e r t i f y the f o l l o w i n g t o b e a t r u e and accurate tra n sc r ip t shorthand n o tes o f my in the a b o v e named i n t e r v i e w . Stenographer The I n s p e c t o r s : MR. ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS 1 2 3 4 5 MR. ROWAN: 6 Good m o r n i n g Mr. 7 The i n t e r v i e w 8 the 9 continuation on W e d n e s d a y 8 t h o f No v e mbe r was a d j o u r n e d a nd t h i s of that interview . is a You w e r e on o a t h on 10 that 11 name i s 12 Ms. Mackey a nd o u r s o l i c i t o r 13 Ms. Mackey w o u l d l i k e 15 MR. STAKELUM WAS INTERVIEWED AS FOLLOWS BY 16 MS. MACKEY 17 MS. MACKEY: interview Stakelum. a nd y ou c o n t i n u e t o b e on o a t h . P a u l Rowan, a s y o u know, Ms. an d t h i s My is Cummins. t o a s k y o u some q u e s t i o n s . 14 18 19 sp ecifically 20 personal a ffa ir s 21 I want t o go b a c k , 22 statem ent. 23 A. 24 1 Q. I d o, Mr. Stakelum, to concentrate on t wo i s s u e s , t o d a y I wa nt o n e w i t h y o u r own and t h e o t h e r a r e y o u r c l i e n t s . have you a copy s t i l l o f your yes. I w a n t t o g o b a c k a nd h a v e a l o o k a t t h a t . 25 say in i t , 26 your c l i e n t s 27 Mahon t o d i a l o g u e w i t h Mr. 28 really 29 the lik e la st at paragraph four, you u s e d t h e to get clear that in d e a lin g with fa cilities Traynor. is, Now y ou o f G u i n n e s s and What I w o u l d you were t e l l i n g o c c a s i o n t h a t when y o u r c l i e n t s u s on wanted 1 th eir 2 y o u w o u l d a p p r o a c h Mr. 3 this? fund m o n itored , which i s t h e w or d y o u u s e d , Traynor, do y o u r e c o l l e c t 4 5 2 Q. What I was w o n d e r i n g i s , on t h e first occasion that 6 you d i d t h i s what l e d you t o b e l i e v e 7 a p p r o a c h Mr. Traynor in ord er to a s s i s t 8 m o n ito r in g o f your c l i e n t s 9 A. It is d ifficu lty that y ou c o u l d w ith the funds? to r e c a ll. Mr. T ra y n o r and I were 10 close personal 11 of business 12 ob viou sly of the 13 Trust, 14 taken p la ce but 15 t h e r e was a f a c i l i t y 16 handled abroad. 17 r ecen tly that 18 G u i n n e s s Mahon Caymen T r u s t a n d l a t e r A n s b a c h e r b u t 19 other m atters 20 b e e n i n G u e r n s e y o r some p l a c e . 21 3 Q. friends d ealings I don't a nd we w o u l d h a v e h a d a l o t together. existence o f G u i n n e s s Mahon Caymen know wha t c o n v e r s a t i o n s w o u l d h a v e I would have e q u a l l y b e e n aware t h a t available fo r h a vin g funds I b elieved a ll a l o n g t h a t up t o t h e y w e r e i n w h at was t h e n known a s a r o s e which meant t h a t t h e y c o u l d have In your u n d e r s ta n d in g o f t h e t h i n g a t t h e tim e then 22 when y o u a p p r o a c h e d Mr. 23 clien ts 24 you would a v a i l 25 G u i n n e s s Mahon Caymen T r u s t , 26 u n d ersta n d in g at th a t time? 27 A. 28 4 Q. 29 I was a w a r e Yes, to your f u n d s y o u a p p r o a c h e d h im i n t h e b e l i e f th at's I see. Traynor in r e l a t i o n Now, of a service fo r your c l i e n t s that in t h a t was y o u r righ t. can I a sk you one o t h e r q u e s t i o n o f a 1 2 A. 3 Clyde E n t e r p r i s e s is? Clyde E n t e r p r i s e s is registration 4 5 Q. 5 A. n o t a co mp a ny , it is a business name. Y e s? One o f t h e n e e d s of the clien ts w o u ld be 6 o c c a s i o n a l l y to withdraw funds 7 One d i d n ' t 8 im m ediate t h e i r needs would be 9 a c c o u n t w h i c h was i n t h e name o f C l y d e E n t e r p r i s e s , f r om f u n d s a b r o a d . know how much o r how o f t e n . I h a d an I r i s h b a n k 10 where I would keep a f l o a t 11 needs. 12 req u estin g £5,000 13 w i t h i n p r o b a b l y 24 h o u r s b u t t h e 14 that 15 offshore 16 E n terp rises. 17 6 Q. 18 A. 19 of o r how funds t o meet th e You m i g h t g e t a p h o n e c a l l i n a morning i n c a s h a nd t h a t w o u l d b e s u p p l i e d source a c c o u n t w o u l d be w i t h d r a w i n g f u n d s and t h e y w ould be l o d g e d i n t o of feeding f r om Clyde How w o u l d t h a t h a p p e n ? I w o u l d make a r e q u e s t t o G u i n n e s s Mahon t o w r i t e me out a cheque. 20 7 Q. 21 A. 22 8 Q. 23 You w o u l d ? Yes. So, the certain 24 A. 25 9 Q. situation float was t h i s , in th is t h e r e was a l w a y s a account? Yes. And a c l i e n t w o u l d come t o y o u f o r an amount o f 26 m on e y t h a t 27 you c o u l d d e a l w i t h t h a t 28 w i t h d r a w t h e m one y f r om t h e C l y d e E n t e r p r i s e s 29 give it y o u c o u l d g i v e h i m f r om t h a t to the clien t? yourself. account, You w o u l d and so 1 2 10 Q. 3 D i d y o u k e e p an e y e on w h e t h e r t h a t w a s . . . (INTERJECTION)? 4 A. Sorry? 5 11 Q. Was i t 6 A. 8 12 Q. 9 A. 10 13 Q. 11 A. 13 14 Q. 14 A. 15 15 Q. 16 A. 17 16 Q. 19 A. 20 17 Q. 21 A. Yes. When y o u s aw i t n e e d e d t o b e t o p p e d up y o u t h e n G u i n n e s s Mahon. Who i n G u i n n e s s Mahon? It c o u l d b e Mr. W ell would i t Traynor. u s u a l l y b e Mr. You a r e t a l k i n g Traynor? about a lon g tim e ago, because a lot o f the I w o u l d b e m e e t i n g hi m a ny w a y . Yes. I w o u l d s a y p r o b a b l y Mr. Mr. C o l l e r y o r Mr. No, C o l l e r y w ould be t h e guy. Traynor. You w o u l d a s k t h e m t o in funds? I w ould a s k them f o r a d r a f t p a y a b l e t o t h a t account. 18 Q. 25 Where w o u l d t h a t draft come f r o m , w h o s e mone y w o u l d t h a t be? A. 27 29 You k e p t i t ? put th a t account 23 28 T r a y n o r who k e p t an e y e on Me. t i m e he - - 18 26 Mr. a p p r o a c h e d who? 12 24 y o u o r was i t w h e t h e r t h a t n e e d e d t o b e t o p p e d up? 7 22 account That would be c l i e n t s wherever the 19 Q. clien ts funds, f r om t h e account funds were abroad. The a c c o u n t y o u r e f e r r e d t o on t h e l a s t day t h a t you 1 2 20 Q. 3 So, o u t o f t h a t w o u l d come f u n d s i n t o Clyde E nterprises ? 4 A. 5 21 Q. That's right. I f we c o u l d g e t on t h e n t o mo r e s p e c i f i c m a t t e r s , 6 Mr. 7 think, 8 any p e r s o n a l d e a l i n g s w i t h A nsba cher? 9 A. 10 22 Q. 11 A. 12 23 Q. Stakelum. That's Is that yes, You t o l d u s i n y o u r s t a t e m e n t , at paragraph four, correct? Yes. D i d y o u e v e r h a v e an A n s b a c h e r t r u s t , h a v e an a c c o u n t 14 yourself? A. 16 24 Q. 17 y o u n e v e r h ad right. 13 15 that I d i d you e v e r i n G u i n n e s s Mahon Cayman T r u s t No. Were y o u b e n e f i c i a l l y en titled t o any fu n d s a t a l l in th e H otchpotch Account? 18 A. 19 25 Q. 20 A. 21 26 Q. No. Or i n A n s b a c h e r a t a l l ? No. R ight, c o u l d I a s k you t o look at some d o c u m e n t s , 22 Mary p a g e 33 p l e a s e . 23 Mr. 24 on t h e 25 number 1 3 1 5 4 9 7 3 a n d a s k i n g h i m t o a p p l y i n t e r e s t 26 date 27 t o have t r a v e l l e r s 28 i s s u e d i n t h e name o f J o h n J . 29 denom inations T r a y n o r t o Mr. 1 st August on t h a t Now, th is is a letter f r om H u mp h r i e s i n G u i n n e s s a nd Mahon 1990, account. referrin g to an a c c o u n t Then h e a s k s hi m t o cheques to the valu e of $100. Stakelum, The b a l a n c e of to arrange $6,000 in on t h e account, 1 the account r e f e r r e d to above, 2 the c h a r g e s and t h e b a l a n c e o f c h a r g e s due s h o u l d be 3 d e b i t e d t o A n s b a c h e r L t d A c c o u n t number 1 3 1 5 4 6 0 2 . 4 These are t r a v e l l e r s 5 Mr. 6 t h a t t o me? 7 A cheques can be u s e d t o meet i n y o u r name Stakelum d e b it e d t o Ansbacher, Number o n e I d o n ' t reme mbe r i t , can you e x p l a i n number t w o t h e 8 A n s b a c h e r L t d A c c o u n t number I h a v e n e v e r h a d a n y 9 knowledge o f t h a t . 10 27 Q 11 A 12 28 Q 13 A 14 R ight. But I c o u l d e x p l a i n i t . Right? The s i t u a t i o n would be t h a t I had t h e H o t c h p o t c h A c c o u n t w h i c h was a n a l y s e d e a c h m o n t h . 15 29 Q 16 A Yes . M o n i e s m i g h t h a v e b e e n drawn f r om t h a t t o C l y d e t o 17 fe e d funds to 18 the 19 30 Q 20 A reverse The r e v e r s e , The c l i e n t s clien ts who w o u l d w a n t t o w i t h d r a w and c o u ld be a l s o true. w h a t do y ou mean t h e r e v e r s e ? m i g h t g i v e me m o ne y o c c a s i o n a l l y i n 21 I r i s h p o u n d s and i f 22 withdraw - - 23 w o u ld n 't be q u i t e 24 w ish e d t o withdraw £ 5 ,0 0 0 25 clien t 26 move a t a l l . 27 Yes . 28 There w ould j u s t 29 debit to for in stan ce and I w i l l make i t sim ple because as sim ple as th a t B w ished to another. c l i e n t A w ished to -- if it clien t A f r o m f u n d s a b r o a d and l o d g e t h e m t h e r e no f u n d s n e e d be a c r e d i t t o one c l i e n t and a T h e s e w o u l d h a p p e n e a c h mo nt h a t 1 2 32 Q 3 A 4 5 Yes . That c o u l d be e x a c t l y in con n ection w ith th a t, that f u n d s w o u l d b e t a k e n o u t t h e r e a n d d e b i t e d t o me. 33 Q 6 These were n ot travellers 7 A 8 34 Q 9 A funds been taken out, cheques i n y o u r name? Yes . T h i s was o b v i o u s l y s o m e t h i n g f o r y o u r p e r s o n a l u s e ? Yes, b u t I w o u l d h a v e t o do a j o u r n a l e n t r y t o 10 c h a r g e me w i t h t h a t 11 fu n d s b a l a n c e d e v e r y month. 12 35 Q 13 A and c r e d i t So, 15 get 17 A 18 37 Q And t h a t Yes, is maybe I am b e i n g v e r y s l o w on t h e u p t a k e h e r e travellers 21 personal use, 22 t h a t was y o u r money? 38 Q somebody w ould have t o w h at w o u l d h a p p e n . 20 24 the Yes . but i t A all the n ecessary c r e d it. 19 23 you s e e , w h a t e v e r w i t h d r a w a l s m ig h t be from a s i t u a t i o n , w hoever t h e y would be f o r , 36 Q -- Yes . 14 16 t h e s e were s e e m s t o me t h a t cheques, if you were g e t t i n g w h i c h was s o m e t h i n g f o r y o u r then t h i s was b e i n g p a i d w i t h mone y But p a i d i n t h e Irish W ell, Can we may b e l o o k a t a n o t h e r perhaps. scene, p a id through Clyde. 25 document a t page 3 27. 26 the 27 Traynor, 28 a c t u a l l y an A n s b a c h e r s t a t e m e n t a n d i f 29 th e m iddle o f i t , account Now, th is is a statem ent of o f A n s b a c h e r L t d c a r e o f Mr. 42 F i t z w i l l i a m just Square, D ublin 2. to the rig h t J. D. S o, it you s e e in is o f t h e name and 1 address 2 Lim ited, 3 th is 4 A/ B S p e c i a l . Now, 5 corner, v ery very hard to 6 is 7 you s e e t h a t , 8 A 9 39 Q 10 A 11 40 Q is o f Mr. it is q u i t e bad, copy sta tem en t" . So coded way o v e r on t h e t o p l e f t - h a n d b u t you w i l l see, see the the photocopy figu res 54973, do on t h e t o p on t h e l e f t - h a n d c o r n e r ? 13154973. R ight. Now, if we g o b a c k t o t h e d o c u m e n t t h a t is 14 date 15 cheques 41 Q "Ansbacher 1 3 1 5 . . . (INTERJECTION). 13 17 see a copy sta tem en t o f a coded accou n t, a few m in u te s A you w i l l r e f e r e n c e A/B S p e c i a l , 12 16 Traynor, h e a d e d "Re A c c o u n t No. of that Yes, So , ago about your t r a v e l l e r s is the sorry, it is letter 13154973". 1 s t August 1990, You s e e t h e do y o u s e e t h a t ? yes. 1 s t August 1990 r e f e r r i n g t o A c c o u n t 13154973. 19 A/ B S p e c i a l a nd we s e e t h a t 20 an e x t e r n a l 21 look at the date 22 entry, 23 is 24 Mr. 25 a nd i t 26 have come. 27 W ell, 28 in d o lla r s 29 I n e v e r saw t h a t We g o b a c k t o t h i s A n s b a c h e r A c c o u n t call deposit of the we s e e t r a v e l l e r s the Traynor. is cheques th a t req u estin g the t r a v e l l e r s 18 clearly I showed you is en titled This 13154973 a c c o u n t US d o l l a r s . 8th August 1990, cheques I f we the $6,000. account r e fe r re d to from t h i s I mean, it last So in the that letter i s Ansbacher coded d o l l a r that your t r a v e l l e r s I accept that account cheques the t r a v e lle r s w o u l d h a v e come f r o m an o f f s h o r e account b efore of cheques account. a nd I s u s p e c t that 1 is 2 Account. o n l y an o f f s h o o t o f what I c a l l th e Hotchpotch 3 4 A. 5 6 Because th a t just shows a b a l a n c e b r o u g h t forward o f $ 6 , O i l , 50. 43 Q. I w i l l be a b l e t o s ho w y o u i n a m i n u t e w h e r e t h a t 7 came f r o m . 8 w h i c h i n d e e d may w e l l b e t h e H o t c h p o t c h A c c o u n t , 9 nevertheless In f a c t , th is is the account th a t a sp ecific account 10 Special" 11 closed 12 a p p e a r s t o b e an a c c o u n t t o t a l l y 13 A. Yes, it came o u t o f "A/B w h i c h a p p e a r s t o h a v e b e e n o p e n e d and f o r t h e p u r p o s e o f t h e one t r a n s a c t i o n I w o u ld n 't deny t h a t fo r your b e n e f i t ? I would have g o t 14 $6,000, 15 got 16 an a c c o u n t 17 I suspect 18 Mahon r e c o r d s w h e r e t h e y . . . (INTERJECTION). 19 4 4 Q. 20 21 Sorry, a ll, A. I mean I d o n ' t re me mb e r i t $6,000. Sorry, say but I might have But I p e r s o n a l l y w o u l d n e v e r h a v e h ad in Ansbacher. that th is th is and i t is is that not is I f t h a t was f o r my b e n e f i t an e n t r y w i t h i n G u i n n e s s and a G u i n n e s s a n d Mahon d o c u m e n t a t an A n s b a c h e r s t a t e m e n t ? an A n s b a c h e r c a r e o f J . D. Traynor, 42 22 F itzw illiam 23 a c c o u n t s h e may h a v e k e p t a nd w h e r e h e k e p t t h e m o r 24 u n d e r w ha t h e a d i n g . 25 t h e r e was e v e r an a c c o u n t o f d r a w i n g $ 6 , 0 0 0 26 lik e 27 it 28 $6,011. 29 Square, I mean I d o n ' t It wouldn't know w h a t s t r i k e me t h a t out, the su g g e stio n there is did I put $6,000 in i f was m i n e b e c a u s e t h e r e is an o p e n i n g b a l a n c e o f 1 2 in stea d of ju st 3 s o m e t h i n g t h e y may h a v e t r a n s f e r r e d o r w h a t e v e r . 4 46 Q. That i s d e b i t i n g a H otchpotch a cco u n t or what t h e y d i d do, Mr. 5 appreciate 6 maybe I c o u l d a p p r o a c h i t 7 ob viou sly required t r a v e lle r s 8 reason, 9 travellers 10 A. To t e l l that. My p o i n t do y o u r e c o l l e c t cheques is I quite slig h tly differen t, a n o t h e r way? cheques You fo r whatever ever seeking to f r om Mr. you t h e t r u t h , Stakelum, get Traynor? I do n o t b u t I d i d o p e r a t e a 11 situation 12 once o n ly g e t t i n g $10,0 0 0 worth o f t r a v e l l e r s 13 cheques. e v e r re me mbe r g e t t i n g t h e m f r om 14 Mr. 15 may h a v e o r d i d , 16 47 Q. i n AIB i n J e r s e y a n d I reme mbe r o n c e and I don't Traynor, but I mean, it C l e a r l y you d i d . seems l i k e accept that 18 h a d w i s h e d t o do i t , 19 Mr. 20 c h e q u e s on w h a t b a s i s ; 21 t h e y w o u l d come from? A. Mr. y o u c a n ' t re me mbe r d o i n g s o , Traynor d i d n ' t you know w ha t was i n t h e H o t c h p o t c h 25 d e b i t i n g and c r e d i t i n g p e o p l e 26 tran saction s 29 but i f where w ould you have t h o u g h t m o n t h a number o f j o u r n a l e n t r i e s A. and I T r a y n o r and y o u w o u l d h a v e a s k e d f o r t r a v e l l e r s 24 28 I you w o u ld h a v e gone t o A c c o u n t o r why t h e y w e r e t h e r e . 48 Q. that it. 23 27 fact J u s t s u p p o s i n g f o r a moment, 17 22 I accept the I would have e v e r y where I w ould be fo r whatever t h e y would t a k e . Yes. I o b v i o u s l y would have p a i d f o r them t h r o u g h s a y C l y d e and w i t h d r e w f r om t h a t situ ation t h e money 1 b e c a u s e t h a t was t h e c o n v e n i e n t p l a c e 2 d o llars. 3 49 Q 4 A 5 Yes, I w o u l d h a v e t a k e n t h e d e b i t t h r o u g h my e n t r i e s f o r Clyde E n t e r p r i s e s . 50 Q Yes . 7 A Like I would, 8 with the 9 else . 51 Q 11 12 A 13 52 Q 14 A if you l i k e , equivalent d eb itin g of $6,000 Jack Stakelum a nd c r e d i t i n g m on e y , isn 't That's right, So, that right? yes. Jack S ta k e lu m would n e v e r have b e e n d e b i t e d ? W ell, I me an, I would pay i f t h e r e was a n e e d f o r me t o pay fo r whatever i t 16 w o u l d make a l o d g e m e n t i n C l y d e p r e s u m a b l y . 53 Q 18 19 20 was I w o u l d p a y f o r i t , Why w o u l d y o u n e e d t o do t h a t , do was t o p i t A somebody B u t t h e m one y i n C l y d e E n t e r p r i s e s was y o u r c l i e n t s 15 17 the You w o u l d h a v e p a i d f o r t he m? 6 10 of gettin g If it when a l l I you had t o up f r om t h e H o t c h p o t c h A c c o u n t ? was my p e r s o n a l d r a w i n g s I w ould have had t o pay fo r t h a t . 21 54 Q 22 A 23 55 Q 24 A 25 56 Q R ight. One p l a c e or th e o th e r . Yes . I didn't have f o r e i g n Why do i t th is 26 a b a n k and g e t 27 way? 28 I don't 29 circum stances know. way? funds. Why w o u l d y o u n o t j u s t your t r a v e l l e r s I mean I c a n ' t go i n t o c h e q u e s i n t h e normal reme mbe r w h a t t h e o f t h e t r a n s a c t i o n would be. 1 57 Q. A ll right, maybe we c o u l d l o o k a t 2 C o u l d we l o o k now a t p a g e 3 4 , 3 letter 4 Intercontinental 5 1 9 9 2 a nd i t 6 the 7 A/ B S p e c i a l 8 b e fo r e but t h i s t i m e mo v e d , 9 accounts did in 1991 t o 10 please. from Joan W i l l i a m s t h i s Irish different is Bank. It referrin g is is This i s tim e t o th e dated the a Irish 9 t h J u ne t o an A n s b a c h e r A c c o u n t i n Intercontinental so i t som ething e l s e . B ank . Again, it is the t h e o n e we h a v e b e e n l o o k i n g a t as a l l IIB, th e Ansbacher so i t has a s l i g h t l y a c c o u n t number a t t a c h e d t o it. 11 12 T h i s t i m e Ms. 13 collection 14 y o u a nd d r a w i n g a g a i n on t h i s A/B S p e c i a l A c c o u n t , 15 what m igh t t h a t be? 16 A. 17 58 Q. W illiam s is asking to a US d o l l a r d r a f t I know t h a t y o u may n o t b e a w a r e t h a t t h e A n s b a c h e r a c c o u n t s h a d m ov e d t o 19 therefore 20 accounts a f t e r 21 b e c a u s e t h a t was w h e r e t h e y w e r e k e p t , 22 l o n g e r i n G u i n n e s s a nd Mahon. 23 withdrawing a d r a ft A. 25 No, payable to w ith IIB. 18 24 her have fo r for $2,000, I n e v e r had any d e a l i n g s I accept that let I I B b u t t h e y h a d and anybody d e a l i n g w ith th e Ansbacher 1 9 9 1 was u n k n o w i n g l y d e a l i n g w i t h IIB t h e y w e r e no Would y o u r e c o l l e c t fo r $2,000? I would a b s o l u t e l y b e l i e v e th at th a t w asn't for my p e r s o n a l b e n e f i t . 26 59 Q. 27 A. T h i s may h a v e b e e n f o r o n e o f y o u r c l i e n t s ? Yes, I h a v e no r e c o l l e c t i o n 28 would a c c e p t 29 m ig h t p e r s o n a l l y have i f $6,000 of it in d ra fts b u t I mean, I as b ein g a need th a t I was t r a v e l l i n g to the I 1 2 60 Q 3 A 4 5 61 Q 7 A 8 62 Q 9 accept that I had a n e e d f o r a p e r s o n a l $2,092 draft. So, your e v id e n c e th en t h a t is th is is a withdrawal W ell, I . . . (INTERJECTION) . Would y o u n o t h a v e w i t h d r a w n f r om C l y d e E n t e r p r i s e s fo r your c l i e n t ? A 11 12 I would n ot fo r your c l i e n t ? 6 10 Yes . It is a dollar dollar 63 Q draft, and I d o n ' t Very w e l l , know w ha t i t c o u ld lo o k at page 38. 14 9th January 1990, 15 Mr. 16 says : Now, f r om Mr. for a is. we w i l l move on a g a i n a n y w a y . 13 17 s o t h e r e was some r e a s o n th is is Mary i f a letter Traynor a g a in , we o f the to L a n i g a n O ' K e e f f e i n G u i n n e s s a n d Mahon and he " C o u l d y o u p l e a s e l e t me a r r a n g e t o have a S t e r l i n g D raft fo r S tg . £ 6 ,5 0 0 payab le to Clare Stakelum. The d e b i t sh o u ld be t o Ansbacher S t e r l i n g A c c o u n t ". 18 19 20 21 And i t 22 relative 23 A 24 64 Q 25 A gives t h e n umbe r. of yours, Mr. Yes . Your d a u g h t e r ? No. She w o u l d b e a d a u g h t e r o f a c o u s i n a nd t h a t w o u l d b e on b e h a l f o f - - 27 alive 65 Q 29 A Clare Stakelum a Stakelum? 26 28 Is at the tim e, Who was h e r f a t h e r ? lik e h e r f a t h e r who was I mean I d o n ' t recollect it now. 1 66 Q 2 C onno r S t a k e l u m on o f t h e c l i e n t s A 4 67 Q 5 A 6 68 Q 7 A Was he y o u r b r o t h e r ? No, cousin. Was he o n e o f y o u r c l i e n t s Yes, or h i s w i t h i n y o u r own system? c om pa ny , w hich w ould be S t a k e l u m ' s Ha rdw ar e L i m i t e d . 10 69 Q 11 A 12 70 Q 13 A 14 71 Q So , th is was h i s daughter? Yes . Do y o u h a v e a d a u g h t e r C l a r e S t a k e l u m ? No, that I see. is Mary, 16 P a t O ' Dw y er , 17 a nd i t 18 t h e o n l y C l a r e S t a k e l u m I know. M o v i n g on a g a i n , 15 please. That i s c a n we l o o k a t p a g e 3 6 , a memorandum o f Des T r a y n o r t o much e a r l i e r , it is the 5th August says: "This i s t o c o n f i r m h a v i n g r e q u e s t e d you t o p u r c h a s e S t g . £500 i n t r a v e l l e r s c h e q u e s i n t h e name o f P a t r i c i a S ta k e lu m , In nism ann, Q u e e n 's Park, M o nk s t o w n, Co. D u b l i n , a nd t o d e b i t t h e c o s t o f £505 t o G.M.C.T. G u in n e ss Mahon Cayman T r u s t , S u n d r y Sub- Company Account. 19 20 21 22 A ls o , to p u rch ase IR.£300 worth o f E s c u d o s a nd t o d e b i t t h e amount t o Amiens S/L A c c o u n t . 23 24 When y o u h a v e t h e a b o v e r e a d y p l e a s e c o n t a c t Jack Stakelum d i r e c t l y " . 25 26 27 29 y ou Yes . memorandum a c c o u n t 9 28 that assisted? 3 8 Was Mr. Is A P atricia She i s . Stakelum your w ife ? 1980 1 a nd t h e 2 Caymen T r u s t A c c o u n t i n 3 w h a t t h a t m i g h t b e a b o u t o r how t h a t 4 explained? 5 It 6 have been t r a v e l l i n g 7 that. 8 73 Q 9 looks lik e does, 1980. Can y o u r e c o l l e c t c o u l d be t h a t w ith th e Escudos t h a t yes, wanted i t , 10 11 It amount b e i n g d e b i t e d t o t h e G u i n n e s s Mahon to P o r tu g a l or som eth in g l i k e b u t my i n t e r e s t it is s h e may where i t is not s o much why s h e was c o m i n g f r o m . I t was coming from t h e A n sb a c h e r A c c o u n t. A A ll I can e x p l a i n about t h a t is that I d i d n ' t have 12 an A n s b a c h e r A c c o u n t p e r s a y a nd I d i d n ' t 13 b enefit f r o m t h e A n s b a c h e r an d t h e b a l a n c e s w e r e 14 clien ts funds; 15 there 16 draw f u n d s 17 would have ta k e n , 18 sa y th e Clyde E n t e r p r i s e s A ccou n t. 19 74 Q 20 A 21 75 Q in the have any but t h e r e would have been a f a c i l i t y sense that t h e r e were f o r e i g n funds to f r o m and I w o u l d h a v e r e p l a c e d w h a t e v e r I eith er d ir e c tly there or through R ight. But I d o n ' t In e i t h e r re me mb e r t h e p a r t i c u l a r of the tr a n sa ctio n s tran sactions. t h a t we l o o k e d a t y o u r 22 own t r a v e l l e r s 23 in stru ction 24 In each c a s e 25 being debited? 26 That i s 27 i n s t r u c t i o n p r e s u m a b l y and I d o n ' t 28 accounts th ey are d e a lin g w ith because 29 have a c c e s s cheques or t h i s to debit it is one, is t h e r e any th e Clyde E n t e r p r i s e Account? an A n s b a c h e r A c c o u n t t h a t n o t my i n s t r u c t i o n , to th e ir coding, th at's Mr. is Traynor' s know w h a t I wouldn't no more t h a n t h e y w o u l d 1 2 76 Q. I see. Can we now l o o k a t p a g e 4 6 . 3 pass 4 fa m ilia r with the phrase 5 A. 6 77 Q. 7 8 that can I a sk you, 9 Stakelum, a r e you " s u it a b ly secured"? Yes. A re y o u f a m i l i a r w i t h t h e e x p l a n a t i o n t h a t G u i n n e s s a nd Mahon g i v e A. Mr. J u s t b e f o r e we Yes, for th at phrase? I have c o n t e s t e d i t M oriarty p eo p le on a f e w o c c a s i o n s w i t h t h e i n p r i v a t e b e c a u s e t h e r e w e r e some 10 situ ation s 11 b a c k - t o - b a c k and I knew t h e r e w a s n ' t i n t h e 12 how f a r o n e w o u l d know. 13 those 14 " s u ita b ly secured" 15 c o n n e c t i o n w i t h r e v i e w i n g a l o a n meant t h a t t h e r e 16 w ere fu n d s e l s e w h e r e b a c k i n g t h a t . 17 7 8 Q. 18 A. 19 79 Q. that t h e r e w h e r e t h e y b e l i e v e d t h e r e was a or " a d e q u a te ly secu red " I contest that, You may c o n t e s t it Mr. that is w h at i t A. Oh, yes, 23 80 Q. S o, I w o u l d now l i k e 24 A. Before but i t is the o f G u i n n e s s a n d Mahon t o u s b u t . . . ( INTERJECTION). you t o l o o k a t a document h e r e ? I ev e n l o o k a t t h e document I w ould l i k e t o h e a r me o u t i n A. Stakelum, means. 22 27 in I a c c e p t . . . (INTERJECTION). 21 81 Q. about Yes. evidence n e v e r th e le ss 26 situations e v i d e n t l y t h e b e l i e f was t h a t t h e p h r a s e 20 25 There are sense of you connection with i t . Right? There were c e r t a i n l y situ ation s I am a w a r e w h e r e t h e 28 words 29 was u s e d b y G u i n n e s s Mahon w h e r e I c e r t a i n l y b e l i e v e " s u ita b ly secured" a nd " a d e q u a t e l y s e c u r e d " 1 t h e r e was no b a c k - t o - b a c k . 2 w asn 't a g en era l r u le but i t 3 if t h e r e was an i n s t r u c t i o n 4 it was s o , 5 or so m eth in g l i k e 6 Mr. 7 Furthermore, 8 t h e r e were b a c k - t o - b a c k s where t h e c l i e n t s 9 aware o f them. 10 82 Q 11 A 12 83 Q or t h a t I am n o t saying i t could a ls o given to t h e r e was a c a s t have a p p lie d consider that iro n guarantee t h a t o r i n d e e d maybe w h e r e T r a y n o r may h a v e g i v e n i n s t r u c t i o n s . I b elieve t h e r e were s i t u a t i o n s w eren't Yes . And t h e r e w e r e r e a s o n s f o r them. T h a t may w e l l b e t h e c a s e w h e r e t h e clien t w asn't 13 aware but i f 14 clien t 15 t h e r e were funds t h e r e t o be a b l e t o back i t 16 A 17 18 Not n e c e s s a r i l y I see. 20 a nd Mahon i n 21 loan s 22 loan s. 23 secured"; 24 the 26 85 Q 27 A 28 86 Q 29 Is nevertheless the c l i e n t s though, Can I a s k now y o u t o Mr. A it it that meant t h a t is up? the I am m a k i n g . 19 25 t h e r e was s u c h a b a c k - t o - b a c k and t h e was u n a w a r e o f point that 84 Q where Stakelum. It 1974, is a loans look at t h is listin g showing l i s t s o f over £10,000 from G u in n e ss of certa in resid en t a nd y o u a p p e a r t h e r e The s e c o n d o n e down h a s b e s i d e do y o u r e c o l l e c t th is loan, it "suitably Mr. Stakelum, lo a n fo r £ 4 0 ,0 0 0 w ith a repayment d a te t h e r e a d a t e when t h e f o r t wo of 1975? l o a n was g r a n t e d . No? Yes. I don't W ell i t It is is the recall the top one. n o t t h e t o p one t h a t second one, I am i n t e r e s t e d t h e one t h a t is in. d e s c r ib e d as 1 2 A. Yes, I can. It is just that 3 p u z z l e s me. If I may e x p l a i n ? 4 H a u g h e y B o l a n d and Company a nd I l e f t 5 D e c e m be r '75, 6 maybe i n 1970 o r 1971, 7 G u i n n e s s Mahon a nd my r e c o l l e c t i o n 8 top ra te of tax in th is 9 order of 80%. p rior to th at, th e repayment d ate When I was i n t h e r e on 1 s t Des T r a y n o r h a d l e f t some t i m e a f t e r is he j o i n e d we w e r e - - the c o u n t r y was maybe i n t h e He came t o me a nd he s a i d t h e r e was a 10 scheme, 11 y o u r t a x and w h a t we d i d a t t h e t i m e an d i t 12 e n t i r e l y he, 13 w h a t s o e v e r o f any n a t u r e , 14 G u i n n e s s a n d Mahon t o l o a n me £ 4 0 , 0 0 0 15 w ould pay i n t e r e s t . 16 a nd t h a t ' s 17 I don't 18 b o r r o w i n g and t h a t 19 for tax purposes. a very leg itim a te because scheme, for m itig a tin g w ould be I w o u l d n ' t have had any funds is T ha t i s he a r r a n g e d f o r the on w h i c h I figure I remember why I am n o t s u r e o f t h e t e n a t t h e t o p . know w h a t t h a t is. I t was a p e r s o n a l interest a t t h a t t i m e was a l l o w e d 20 21 The £ 4 0 , 0 0 0 was g i v e n a s - - 22 th is 23 was l o a n e d t o 24 earned i n t e r e s t 25 d i f f e r e n t i a l but 26 in terest 27 t h e d a t e p u z z l e s me a b o u t 28 repayment d a te . 29 as a scheme, it's a lon g tim e back, a co mp a ny , there. I am t r y i n g t o remember -- £40,000 p r e s u m a b l y i n Caymen and There w ould be c e r t a i n l y I would have p a i d t h e h e r e an d c l a i m e d i t for tax. '75, a gross This i s why maybe t h a t was a 1 But I t h i n k i t 2 that. 3 88 Q 4 was b e c a u s e we s e e t h e r e . . . (INTERJECTION)? 5 A 6 89 Q 7 8 I think i t might have been p a id back b e f o r e Would i t It co u ld have been b ecause th e says, A 9 h a v e b e e n p a i d b a c k b e f o r e March due t o I think i t A pril '74 in terest sin ce comment t h e r e gains it repaid? was p a i d b a c k b e f o r e March cap ital '74? '74 b e c a u s e t a x came i n a n d t h e concept 10 was t h a t 11 w h i c h now h a d a w o r t h o f , 12 som ething, 13 w h i c h was a t a x 14 t h e meantim e you had t h e a d v a n t a g e o f h a v i n g t h e 15 i n t e r e s t p aid having allow ed fo r ta x . 16 90 Q 17 A y ou l i q u i d a t e d t h e A perfectly legitim ate c o m i n g i n and t h e b e n e f i t 20 lost A quite scheme, 19 22 let's say £43,000 figu res or were, legitim ate, but in Yes . view, 91 Q w ell gain, 18 21 co mpany i n t h e Caymen, I am n o t s u r e w ha t t h e free in a t March '74 b e c a u s e liquidated, cap ital i n my g a i n s t a x was o f t h a t would have been then. What was t h e name o f co mpa ny Mr. Stakelum? I h a v e no i d e a . I h a d no m o n e y . I h a v e no i d e a , 23 was a t h o u g h t p u t t o me b y Mr. 24 h a v e known o f t h e 25 advantage, 26 g a v e me t h e m o n e y , 27 so, 28 t h e t i m e and i t 29 once o f f . existence Traynor, It I wouldn't o f the a b i l i t y or t a x b u t t h e y l e n t me t h e m on e y a nd t h e y n e v e r if you l i k e , I s u p p o s e t h e y had t h a t it was l o d g e d t h e r e , as s e c u r i t y for i t was l i q u i d a t e d t h e n i n March all '74, a 1 92 Q 2 A The i n t e r e s t Yes, t h a t h a d b e e n e a r n e d on i t when t h e co mpa ny was l i q u i d a t e d , 3 tax. 4 on i n t e r e s t 5 a r i s e n t o me and t h e t a x d e d u c t i o n . 6 93 Q I t w ould be l e s s here, obviously in vested 8 earn i n t e r e s t ? 9 A 10 94 Q 11 A 12 95 Q No, no, it the £40,000 of those funds, some w h e r e s o t h a t t h e y w o u l d l o a n t h a t was g r a n t e d t o me. Yes . Was e v i d e n t l y p l a c e d i n t o that The company was n o t a b a n k . compa ny on d e p o s i t . I presume i t co mp a ny i n c o r p o r a t e d i n Caymen. 14 have t o d e p o s i t 15 right? A gains but t h e a d van tage would have 13 16 capital t h a n what t h e y w o u ld h a v e g o t The Caymen co mpa ny t h a t h a d c o n t r o l 7 was y o u r s ? Presumably i t was a The c ompa ny w o u l d t h a t mone y s o m e w h e r e , isn 't that was w i t h i n t h e b a n k i n g s t r u c t u r e 17 t h e G u i n n e s s Mahon o r t h e G u i n n e s s Mahon Cayman 18 Trust, 19 96 Q 20 21 know. P r e s u m a b l y G u i n n e s s Mahon Caymen T r u s t , most l i k e l y , w o u l d n ' t t h a t be t h e c a s e ? A 22 23 I don't of R ight, so i t 97 Q because wouldn't it would be o u t s i d e the ju risd iction fetch tax l i a b i l i t y . T h i s mone y l o a n e d t o y ou b y G u i n n e s s a nd Mahon w o u l d 24 h a v e b e e n on d e p o s i t 25 w h i c h w o u l d e x p l a i n why y o u r l o a n was d e s c r i b e d a s 26 su ita b ly secured, 27 28 29 A i n G u i n n e s s Mahon Caymen T r u s t , w ouln't t h a t be t h e case? I w o u l d n e v e r h a v e g o t a p e n n y i n t o my h a n d s f o r that, t h e y h e l d t h e mone y a l l t h e wa y. 1 I don't know whether it would be lodged in Caymen 2 Trust, you see you have the thing that it could have 3 been, for instance, a Caymen company that lodged the 4 money in Dublin. 5 £40,000 sitting side by side 6 because...(INTERJECTION). 7 99 Q I mean they could have had the But wouldn't it have had to be offshore for the thing to work? 8 9 A 10 100 Q 11 A 12 It is the ownership of the funds that was offshore. Yes . I mean if a foreign company lodges money in Dublin it would be tax free, you know. 13 101 Q 14 A Yes . So, I wouldn't know where that was. Mr. Traynor 15 merely came to me, like it worked but it was only 16 for a relatively short period of time because 17 capital gains tax was introduced, it might have been 18 a year or two. 19 102 Q 20 A 21 103 Q 22 23 Yes . Or something like that. The interest that had accrued on that did you leave it there? A No, no. That was a capital gains tax, the interest 24 had accrued because the company was liquidated so I 25 would have taken it back and that would have been 26 what paid off the loan. 27 104 Q 28 A 29 Yes . What I would have got into my hands, I would have presumably paid the interest up front and then they 1 got the capital gain back which would be something 2 less that that interest would have been. 3 105 Q 4 A 5 6 I see . I remember the other loan too now, but that is of no interest to you, no? 106 Q It is not, no. Now, can I ask you to look at page 7 69 please. 8 Mr. Traynor to Guinness and Mahon dated the 6th 9 September 1990, referring to Ansbacher Limited This is another document a letter from 10 account A/B-CZ. 11 that we have looked at before and he says: This is a different one to the one 12 "Dear David, 13 The above deposit matures on 10/9/90. 14 On that date could you please arrange to let me have a cheque for IR£1,500.00 payable to Business Enterprises and roll the balance of £63,462.88 for one month". 15 16 17 18 Now this was the situation where a sum of money, a 19 specific sum of money, was clearly on fixed deposit 20 and your company Business Enterprises seems to have 21 been able to draw apparently the interest from that 22 before it was rolled over to another fixed term. Can 23 you suggest what that might be about? 24 A 25 Yes, I think so. Do you remember you mentioned Clyde Enterprises? 26 107 Q 27 A 28 108 Q 29 A Yes . That is a business registration name not a company. Yes . 1 registration named Business Enterprises and I 2 suspect that is what that is, to be payable to 3 Business Enterprises and that would have been duly 4 paid out to whatever client. 5 this but I mean that is what I can assume. 6 not Business Enterprises Limited and there was a big 7 distinction between the two. 8 109 Q 9 A I obviously don't know That is I see. I don't know what that is. If that were Business 10 Enterprises Limited, I can only assume that would 11 have been an invoice from Business Enterprises 12 Limited to somebody who was being paid some fee for 13 something. 14 limited. 15 110 Q 16 A 17 Yes . Then it would be like a payment into Clyde for interest earned. 18 111 Q 19 A I see . Some client may have wanted to withdraw his interest, 20 21 If it is Business Enterprises not 112 Q I have no idea. Clearly if this was one of your clients then it was 22 a client who hadn't got his funds in the Hotchpotch 23 Account but had a very specific fixed deposit. 24 That's right. 25 Hotchpotch Account but you could have had situations 26 where 27 generally on a rollover of one month's interest; but 28 some clients would specifically want say a three 29 month and that might be segregated. Generally speaking it was a -- the Hotchpotch Account merely earned money 1 113 Q 2 A 3 When I say segregated, Guinness Mahon wouldn't have knowledge of who they were. 4 114 Q 5 A Right. Let's say well £60,000 on three months at whatever 6 but as far as I was concerned it was all a 7 Hotchpotch Account. 8 115 Q 9 How would you be able to account to your particular client for this since Guinness and Mahon wouldn't 10 know to tell you who the client was. 11 know how this client account was doing. 12 means would Guinness Mahon communicate? 13 A Every month we reconciled. How would you By what Every month with 14 Guinness Mahon, the totality of the funds and every 15 month I would have reconciled the balance on Clyde 16 Enterprises Account. 17 116 Q How would you describe this account if you wanted 18 information on it since Guinness and Mahon didn't 19 know who's it was? 20 A I really don't know. I really don't know, I mean it 21 might be when we are sitting down or talking over 22 the telephone about it like, 23 £60,000 on deposit", or there might be other ones 24 etc, what were they and get information about them. 25 It is clear that Guinness and Mahon described this 26 account by a code, 27 to David Humphries referring to that. 28 how Guinness and Mahon saw that account, it was an 29 account described as "Ansbacher Limited Account "and what about the "A/B-CZ", Mr. Traynor is writing So, that was 1 A/B-CZ". 2 Yes, I mean I have no idea what coding they were 3 using or reference. 4 118 Q 5 A I understand that. To tell you the truth I thought I knew everybody in 6 Guinness Mahon, I don't ever remember David 7 Humphries. 8 119 Q 9 Well leaving aside that for a moment, would Mr. Traynor have known the identity of this person? 10 A 11 120 Q The probability is not, but I don't know for sure. Well then this brings me back, if Mr. Traynor did 12 not know who it was but gave it a code, you knowing 13 who it was, then in order for Mr. Traynor to tell 14 you about this he had to refer to it by the code to 15 you, didn't he, what other way could he refer to it? 16 A No, he wouldn't, he wouldn't. Was he still in 17 Guinness and Mahon? 18 Mahon at that stage if he is writing letters from 19 Fitzwilliam Square. 20 121 Q 21 A 22 23 No, he wasn't in Guinness and Yes . So, I probably wouldn't be dealing directly with Des Traynor in connection with that at all. 122 Q Well that is even more puzzling then, how would 24 Guinness and Mahon be able to tell you how this 25 client's account was doing other than by referring 26 to it by this A/B-CZ? 27 Because if I was sitting down 28 that many accounts involved like -- if I was sitting 29 down and I was talking on the telephone to somebody -- there wouldn't be 1 and if I wanted to reconcile balances at the end of 2 month and at that stage if Mr. Traynor was gone it 3 would probably have been Padraig Collery, then I'd 4 be saying, like on the general account how much is 5 the interest earned and agreeing if there were 6 withdrawals, etcetera, etcetera, and what about on 7 the £60,000. 8 123 Q. 9 A. You could refer to it like that? I think that's the most logical way to refer it 10 because I don't know that we would -- 11 have many separate accounts, we might have had 12 dollar accounts as well but we wouldn't have had any 13 separate accounts, so, there wouldn't be a problem 14 in identification. 15 seven or eight or ten or twelve we'd only be talking 16 about a few accounts, you'd probably refer to them 17 as the principal sum. 18 because if there was a reference on those accounts 19 that reference would be a thing that Guinness and 20 Mahon would use rather than me. 21 124 Q. we wouldn't I mean I wasn't talking about That's not being coy about it Mr. Stakelum, if I could just go back over what your 22 evidence has been this morning at least on this 23 point. We have seen that you and members of your 24 family had funds withdrawn from Ansbacher, debited 25 to Ansbacher for their personal use, now as I 26 understand it your explanation for that, I am still 27 not terribly clear about it, but if I am wrong now 28 in what I say correct me. 29 1 Your explanation is that you might withdraw funds 2 like that for your personal use and then repay it 3 back into Clyde Enterprises, is that right? 4 5 125 Q. Then in respect of your suitably secured loan or 6 what you described as a suitably secured loan, your 7 evidence is that Mr. Traynor had explained this 8 particular type of tax avoidance scheme? 9 A. 10 12 6 Q. That's right. Whereby you would borrow money from Guinness and 11 Mahon and it would be put offshore in the name of a 12 company, a foreign registered company, where it 13 earned some interest. 14 off the interest here which you would be able to set 15 off against tax. 16 the interest that had accrued on it would be a 17 capital gain to you? 18 A. In the meantime you would pay When the company was liquidated That's right, absolutely. There is the possibility, 19 I don't remember, that instead of paying off the 20 interest here which would effect a cash flow because 21 I wouldn't have had many means at that time, they 22 may have deferred the collection of interest, the 23 charge for interest would be allowed for tax 24 purpose. 25 interest until the company was liquidated. 26 think there was a long period of time in that 27 because capital gains tax coming in nullified the 28 effect of that. 29 They may have deferred the collection of I don't 1 2 Mr. Stakelum. 3 questions on another point now and I will come back 4 later to the issue of your clients. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Mr. Rowan would like to ask you 1 2 3 MR. ROWAN: 4 Before I ask you some questions about another 5 aspect may I just clarify something? 6 that the Caymen company to whom the £40,000 had been 7 loaned was liquidated and that produced a capital 8 gain for you, who owned or controlled the Caymen 9 company? You explained 10 Entirely done by Guinness and Mahon. 11 wouldn't even remember the name. 12 through to me as me being very close to Des Traynor 13 and he had to obviously -- Guinness and Mahon -­ 14 offer me the facility to put the £40,000 away so to 15 speak, because I didn't have those kinds of funds 16 and it was purely a legitimate means of some tax 17 avoidance at the time. 18 128 Q I mean I That was put Would you agree with me if I suggested that on the 19 liquidation of a company the shareholders would be 20 the beneficiaries of any increase in the value of 21 any of the shares? 22 A 23 129 Q 24 A 25 130 Q 26 A 27 131 Q 28 A 29 132 Q Yes, presumably I would...(INTERJECTION). Would that not be correct? I think so, yes. Were you a shareholder in that company? I must have been, I mean I think I must have been. You said a moment ago that you didn't know that? Well I don't remember. 1 Mr. Stakelum, you were a shareholder in that Caymen 2 company were you not? 3 A. 4 133 Q. I believe I must have been. Thank you. Earlier in the interview you explained 5 that Clyde Enterprises was a trading name or a 6 business name, is that correct? 7 A. 8 134 Q. 9 A. 10 135 Q. 11 A. 12 136 Q. 13 A. 14 137 Q. 15 A. 16 138 Q. 17 A. 18 139 Q. 19 A. 20 14 0 Q. Business registration, yes, that's what it is. So, it was just a business name? That's right, it is registered. A registered business name? Yes. Registered with? Me as the proprietor. With you as the proprietor? Right. Registered with the business names registry? Exactly. It had a bank account with which bank please? AIB. When you required further monies you asked for money 21 for withdrawal from GMCT, for Mr. Traynor and a 22 draft would be produced a a result of that request? 23 A. 24 141 Q. 25 A. 26 142 Q. 27 That's right. Which you lodged into the AIB bank account? That's right. And arising from that you them made payments to your clients ? 28 A. 29 143 Q. Right. When your clients were depositing money with you to 1 go to GMCT did you lodge those moneys into you AIB 2 account in the name of Clyde Enterprises? 3 A. 4 144 Q. Sometimes, if they were Irish funds. Mr. Stakelum, I think as customary at about this 5 time in the morning we stop for a cup of tea or 6 coffee, I think you know the routine, we are going 7 to do that now for ten minutes or so. 8 9 SHORT ADJOURNMENT 10 11 145 Q. MR. ROWAN: Mr. Stakelum when you were 12 last here for interview we 13 explored with you a certain amount of how much 14 contact you had had with Mr. Traynor and Caymen 15 Trust and so on, it was a somewhat disjointed 16 discussion at times and we wanted to clarify some of 17 the matters which seemed not to have been adequately 18 dealt with. 19 may? That is what I want to do now, if I 20 21 I think you indicated to us last time that from 22 approximately 1956 to 1958 you worked as a article 23 clerk, if I may use that term, which I think was the 24 term relating to the day? 25 A. 26 146 Q. 27 28 29 Right. What sort of work did you do as an article clerk, broadly? A. It was a relatively small practice. There was just Charlie Haughey and Harry Boland, the two partners. 1 Des Traynor would have been manager. 2 been shortly qualified around '55/'56. 3 maybe six to eight article clerks, I think there 4 were four each allowed, 5 of secretaries, mostly auditing work. 6 147 Q. 7 He would have There were I am not too sure. A couple So you would have been working as a junior on an audit team or a series of audit teams? 8 A. 9 148 Q. 10 Arguably, yes. Mr. Traynor, as you have just said was a manager at that stage, a qualified manager? 11 A. 12 149 Q. 13 A. 14 150 Q. 15 Yes. He would have been heading up audits? That's right, yes. Did you work with him as a junior on some of those audits ? 16 A. 17 151 Q. 18 A. 19 152 Q. Yes, very closely I would say. Did you work with him quite a bit? Yes, quite a bit. In those days, I think I am correct in saying, that 20 the Institute of Chartered Accountants and you are a 21 chartered accountant I believe? 22 A. 23 153 Q. 24 The Institute of Chartered Accountants exams were five parts, if I recall? 25 A. 26 154 Q. 27 A. 28 155 Q. 29 That's right. No. They weren't? No. How many parts were there? 1 156 Q Right. Can you recall the sorts of subjects that 2 would have been included in those examinations? 3 What sorts of subjects did you have to answer on? 4 A There would have been to final maybe there was, as I 5 recall about 16 subjects covered in eight papers. 6 There would have been accounting one and two, 7 executive accounting, partnership accounting, branch 8 accounting and general accounting. 9 been two papers. They would have There would have been a paper on 10 auditing, that is three. 11 taxation, 12 would called cost accounting, would be five, that's 13 now management accounting I think. 14 been company law, six. 15 have been eight papers done in my final anyway. 16 157 Q four. There would be a paper on There would be a paper on what we There would have I don't know, there would I think you have provided me with the piece of 17 information that I was looking for, there was a tax 18 paper? 19 A 20 158 Q 21 A 22 159 Q 23 24 There was. Covering personal tax and corporate tax? That's right. Thank you. Then from around 1962 when I think you indicated you qualified? A 25 I think '61 but I went back to Haughey Boland in '62, yes. 26 160 Q 27 A 28 161 Q What changed then in the sort of work that you did? 29 A Not a lot immediately except that I would have been But as a qualified senior? Yes . 1 the senior and taking charge of the audit for 2 clients. 3 in Haughey Boland and Company where I might have 4 been scheduling work for the other auditors in the 5 firm or the other employees and that but generally 6 heading up the bigger audits. 7 162 Q I also was in a kind of a managerial role So you were heading up the audits. To what degree 8 did you have responsibility for the taxation issues 9 which would usually have followed on from preparing 10 a set of accounts for a firm or a corporate entity? 11 A I don't know the exact date but at that time there 12 was a great tendency for the practitioners to employ 13 people from the revenue. 14 ex-inspectors of taxes in and the tendency would be 15 when you completed an audit that you probably 16 prepared the computation or if you didn't, you 17 certainly got all the information ready for the 18 computation and then you got it approved by the 19 tax department. 20 163 Q We would have had some During that period when you were a manager, 21 obviously with more responsibility than before you 22 qualified, did you then have a further opportunity 23 to work with Mr. Traynor? 24 A 25 number of assignments. 26 164 Q 27 A 28 29 Yes, we would have been very close together on a He was a partner at that stage? He was a partner when I went back in '62, that's right. 165 Q So the relationship changed from being a junior to a 36 1 manager; the relationship was one of manager to 2 partner? 3 Right. 4 16 6 Q Did you work with him on his clients for which he 5 was the partner responsible. 6 manager on those clients? 7 A Yes, that's a fair comment. You worked with him as I think I would have 8 been displacing him from a lot of situations. 9 would have been moving on to other things. He I 10 remember very heavy work loads and one particular 11 client that was his responsibility and he kind of 12 unloaded onto me and I always said that was almost 13 the last straw, that he was almost severing himself 14 from the normal auditing work. We would have worked 15 very closely together, undoubtedly. 16 167 Q Nonetheless he remained as the partner to whom the 17 client looked in the first instance and you did a 18 lot of the work in preparing the data? 19 A 20 168 Q That's right. You have just indicated a moment ago that he moved 21 onto other things. 22 to specialise in some way? 23 Specialise, 24 I say that he moved onto other things he certainly 25 seem to extract himself a lot from the day-to-day 26 work. 27 of not working but there were things that he got 28 involved in. 29 very big way, he was certainly with a company called Does that mean that he started I don't know if that is the word. When He was a work-a-holic so it wasn't a question He got involved with clients in the 1 Merchant Banking and he would have at least every 2 Friday morning, always been at a board meeting 3 there. 4 he was always at a board meeting there and he would 5 get involved in other situations. 6 relate when the dates were. 7 to join Guinness and Mahon he got very involved with 8 projects that they were involved with, property 9 projects that the bank were involved in, he was in 10 11 I don't know if he was on the board now, but It is hard to I know before he left an advisory capacity. 169 Q Don't jump ahead too much. Let's try and keep the 12 thing in a logical flow. 13 client of Haughey Boland at the time? 14 A 15 170 Q 16 17 Was Merchant Banking a That's right. And that was one of the clients for which Mr. Traynor had a responsibility? A That's right but in addition to that, Matt Gallagher 18 would have been the owner of it and there were 19 groups of building companies there, I'm not sure 20 what they would have been but he would have been 21 very involved with that. 22 171 Q Merchant Banking, if I recall correctly, had a 23 subsidiary in Northern Ireland. 24 responsible for that? 25 A I don't have any memory of a Northern Ireland connection. 26 27 Was Mr. Traynor 172 Q Right. So he worked with Merchant Banking and 28 perhaps that give him an interest in the whole area 29 of being involved with banking situations? 1 I don't think that was the reason that he ultimately 2 finished up with Guinness Mahon. I think there was 3 a very specific reason for that. I don't know. 4 We will come to that. 5 started to take a lot of responsibility for clients 6 of which Mr. Traynor was the partner. 7 became a partner? 8 A 9 174 Q 10 A 11 175 Q 12 13 Anyway the point was that you In 1967 you That's right. What age were you in 1967? 33. 33 right. Were you a general partner or did you have specialised responsibilities? A I think before he left, obviously we would have had 14 discussions about things, the partners and that. I 15 tended to specialise in liquidations and 16 receiverships because the appointment of liquidators 17 or receivers is a personal thing. 18 it is an individual that gets appointed a liquidator 19 so you have to push a name of an individual if you 20 were to become known in the field. 21 sufficient liquidations and receiverships at that 22 stage where it would be exclusive to all other 23 things; so to that extent I would specialise in 24 liquidations and receiverships but continue to 25 handle a number of auditing situations as well. 26 176 Q 27 A 29 177 Q There weren't How much of your time would you have spent on those two main parts of your work? 28 It is not a firm, The liquidations and receiverships? 1 2 A. I think it would have grown one way as opposed to 3 the other. Obviously when you came to liquidation or 4 receivership it was a fairly urgent 'fire brigade' 5 situation where you might have to go in immediately. 6 More and more it became that way. 7 I left Haughey Boland in '75 that I took something 8 like 43 or 44 liquidations or receiveships with me, 9 in the sense that it was a decision that I would I know that when 10 remain rather than resign and pass it onto somebody 11 else, and wrap them up. 12 178 Q. Receivership work is quite different from liquidation work, is it not? 13 14 A. 15 179 Q. 16 There are very distinct differences, yes. Can you just outline what you perceive were the differences in the early 1960's? 17 A. 18 180 Q. 19 A. Between receivership and liquidation? Yes? You were appointed liquidator almost after the fact 20 in the sense that the company had gone and had 21 passed its resolutions and appointed you liquidator. 22 That was a total question of winding up the company 23 and paying the creditors in the order in which they 24 were entitled to be paid. 25 181 Q. 26 result of the liquidation. 27 A. 28 182 Q. 29 So the company, effectively, had come to an end as a Exactly. Receivership? 1 be so. 2 but there was still the possibility that you could 3 revive the company if you could correct the problem 4 that had caused the receivership in the first place. 5 Your responsibility was to the debenture holder who 6 appointed you subject to certain other criteria but 7 you had no responsibility really to the general 8 creditors other than not to be negligent about the 9 assets . 10 183 Q It was very often a mortal blow to a company In what proportion of the receiverships were you the 11 principal, did you find yourself with a trading 12 receivership on your hands, approximately? 13 A 14 184 Q 15 A 16 185 Q 17 18 That was never wound up? No. You always traded for a while. Where you perceived it was possible to continue trading the business perhaps before passing it on? A Not many, because often and the tendency was that 19 people didn't seek to make appointments until the 20 companies were mortally wounded. 21 there were some. 22 186 Q 23 So the trading element of it was for a better realisation of the assets? 24 A 25 187 Q 26 27 But on occasions, Generally. Prior to your appointments as partner, who had done insolvency work in Haughey Boland? A I probably did a lot of it but either Mr. Boland who 28 was a partner or Mr. Traynor who was a partner. 29 Either one of them would have been the nominee. 1 188 Q 2 3 work? A 4 5 So Mr. Traynor understood something about insolvency Mr. Traynor was very brilliant on a cross-section of work. 189 Q So, Mr. Traynor decided to leave Haughey Boland and join Guinness and Mahon? 6 7 A 8 190 Q 9 Yes . He was then an established partner in Haughey Boland? 10 A 11 191 Q Very much so. And a very able man as you have just said. Did that 12 decision come as a surprise to his partners and you 13 in particular? 14 A 15 192 Q 16 A I think the word would be shock. Why? Because he would have been, he was a work-a-holic. 17 He would have worked morning, noon and night. He 18 would have been a real corner-stone of the 19 partnership and he would have been considered a 20 massive loss to a relatively struggling partnership. 21 That's why it would have been a shock. 22 193 Q 23 A Nonetheless he decided to go? Yes. I don't recall the exact time but I suspect 24 that he would have come in at some partnership 25 meeting and his announcement wouldn't have been 26 that I am leaving next week, it would be that he was 27 leaving in some months time. 28 would have been substantially involved with work 29 connected with Guinness Mahon. But prior to that he He used to be with 1 them far more than with us in Haughey Boland at the 2 time . 3 194 Q 4 A When did he start to work with Guinness and Mahon? I am not sure when he left. I'm always confused 5 whether he left in 1970 or 1971. 6 31st March. 7 that. 8 taxation schemes with them. 9 wouldn't have known anything about it, whether I think it was the I'm not sure, a year or two before He worked on some property schemes and I'm not sure. I 10 Guinness and Mahon were financing them or taking 11 equity in them or what they might have been, but he 12 obviously made a very able contribution to whatever 13 they were doing because they invited him to join the 14 board in a very senior capacity there. 15 195 Q May I just enquire whether Guinness & Mahon were 16 clients of Haughey Boland or clients of other 17 people. 18 A 19 196 Q 20 21 No. Guinness Mahon, no. So that Mr. Traynor was actually providing special services of a non-audit nature to Guinness Mahon? A You have me thinking there because I would have been 22 very familiar with things like bills because I would 23 have looked after Haughey Boland's own accounts and 24 we never sent a bill to Guinness and Mahon but with 25 all the work he was doing who got paid for it, 26 think he was keeping his end up in Haughey Boland as 27 well, working nights and weekends. 28 At some point in his career he made contact with 29 Guinness Mahon and then got the opportunity to I 1 2 A. You are being very definitive about it. I think how 3 he came to their notice was maybe acting for some 4 client in some property situation where they may 5 have been another party to it and were very 6 impressed with him that's all I can say. 7 know. 8 198 Q. 9 A. 11 199 Q. 12 13 Having impressed them they made him an offer that he couldn't refuse. 10 I don't Is that what it sounds like? Absolutely. He went there as deputy managing director, joint managing director? A. I think joint managing director. The structure 14 there at the time, I think George Mahon was still 15 there and John Guinness was certainly there because 16 I had dealings with John Guinness afterwards. 17 there was a William Forwood who was a Solicitor. 18 don't know let's say whether George Mahon was 19 chairman and the other two joint Managing Directors. 20 I think when Des went in George Mahon may have 21 retired, John Guinness may have become Chairman and 22 he became joint Managing Director with William 23 Forwood. 24 could be slightly wrong there. 25 200 Q. Then I That would be what I would believe but I Here we have someone who was an experienced partner 26 in a small firm of chartered accountants, who had 27 had limited experience of banking, being invited to 28 become the most senior person or one of the most 29 senior persons in a bank. Is that the nub of it? 1 2 Right. 3 and joined Guinness Mahon, did your situation change 4 in Haughey Boland. 5 responsibilities come you way? 6 A Once Mr. Traynor had departed Haughey Boland Suddenly did more It certainly changed in terms of percentage. I 7 would have been a junior partner and immediately 8 after that I became a senior partner. 9 202 Q 10 A Who were your fellow partners at that stage? At the time that Des Traynor left, Harry Boland was 11 a senior partner, Des Traynor was senior partner, 12 Frank Donnelly and myself two junior partners. 13 there was an old situation with Mr. Haughey. 14 Mr. Haughey had never resigned from the partnership, 15 he never took benefit from it, but we, Mr. Donnelly 16 and myself were 10 percent partners each, that left 17 80 percent between the other three 18 2/3rd percent each. 19 say what happened at the end of day, at the end of 20 the day when we shuffled through the thing and 21 Mr. Traynor left, there were four twenty-five 22 percents being, Mr. Boland, Mr. Haughey, 23 Mr. Donnelly and myself. 24 participating and his 25% was only memo and he never 25 took anything from it and hadn't for a number of 26 years. 27 203 Q 28 A 29 204 Q But which was 26 and Will I skip all the thing and Mr. Haughey not Because he was involved in other things? Politics, yes. My question of you, did more responsibilities come 45 1 2 I was now effectively a third equal senior partner. 3 You were very busy all the time in those days. I am 4 not sure what extra responsibilities because I would 5 have been shouldering loads of responsibilities 6 anyway. 7 205 Q 8 You have already told us that some of your work was insolvency work? 9 A 10 206 Q That's right. But there wasn't enough of that for it to be full 11 time and some of your work was as a general, if I 12 can use the term, audit partner. 13 inherit some more audit client assignments for 14 instance? 15 A Did you suddenly I think Mr. Traynor was away from the auditing for 16 quite some time before he departed the scene. 17 would I inherit? 18 207 Q 19 20 Did you get his clients. What Were his clients passed to you as the focal point? A I think they would have been passing to me over the 21 years. 22 I can't remember in detail but I would presume that 23 I did. 24 208 Q 25 He was backing off from that. I presume so. So he had gone and you and he had built up considerable friendship over the times? 26 A 27 209 Q Absolutely. Did you see him and or Guinness and Mahon as a 28 potential source of more project work? 29 instance, he had been providing these projects. For He 1 had been servicing these projects and then he had 2 gone to be a managing director. 3 present you with an opportunity to work with 4 Guinness Mahon as a client? 5 A. No. Did that not I would have viewed Guinness Mahon as a bank. 6 They were an investment bank more than commercial 7 bankers. He was there. 8 resource, I suppose, having a friend the managing 9 director of a bank is no harm, particularly when you It would have been a 10 are in the insolvency and rescue operations and 11 things that might happen in that case. 12 that we tapped into a source in any particular way. 13 He was more friendly with me than with anybody else. 14 210 Q. I don't know Let me put a particular question, did you get the 15 opportunity to advise Guinness Mahon on any 16 troubled business assignments where, for instance, 17 things were going wrong and there was a business, 18 borrowing the money and what has subsequently become 19 know as a business review. 20 do that? 21 A. 22 211 Q. Did you get a chance to No, never on the assignment from Guinness Mahon. First, did you get invited by Mr. Traynor or indeed 23 others in Guinness Mahon, to attend any lunches 24 where they would have wanted to have told you what 25 they were doing? 26 A. It was the reverse in the sense in that I would have 27 given Guinness Mahon quite a bit of work, in the 28 sense of introducing clients to them, that they 29 would have provided facilities to and things like 1 that so I would have been well known. 2 certainly invited to a number of golf outings after 3 which there would be a dinner and I remember Maurice 4 O'Kelly, he had joined the bank later on, at one of 5 those dinners saying: "Listen you lot" and there 6 would be load of business men, 7 the expense of feeding you and giving you dinner 8 without getting some feedback from you that we want 9 business from you". I was "we are not going to That sort of thing. There was 10 never any detailed discussion about Guinness Mahon 11 or projects. 12 212 Q Did they ever hold any seminars when they would 13 outlined some of the interesting new products which 14 I have no doubt they would have wanted to have 15 persuaded advisors to encourage clients to avail of? 16 A 17 213 Q I can't recall Haughey Boland being invited to any. Right. So that there wasn't much work coming to 18 Haughey Boland from Guinness Mahon / Mr. Traynor, 19 but there were opportunities coming from Haughey 20 Boland to Guinness Mahon? 21 A 22 214 Q 23 A That's right. Tell me about those? In situations where financing might be off the 24 straight and narrow with some unusual situations, 25 could have introduced clients to Guinness Mahon, 26 probably to Des Traynor to discuss and they were 27 some of them that clicked and they provided 28 substantial funding to them. 29 All right. Then you decided 48 that you would leave I 1 Haughey Boland and I don't need to know anything 2 about why that was but, suddenly you had an 3 opportunity to setup your own business and last time 4 you told us that you had never been or didn't 5 consider yourself as a tax adviser. 6 I certainly never did that. 7 216 Q 8 A 9 10 And not an auditor either? I was an auditor. business? 217 Q Oh, sorry, when I set up in No, no auditing and no tax. Mostly your business when you set up was in the 11 finance area with banks as raising loans and 12 organising securities and that stuff. 13 whether your business, at any stage because we have 14 been talking about the fairly early stage of all of 15 this up to now, at any stage from the time you set 16 up, did your business fall within the scope of 17 regulation of the Institute of Chartered Accountants 18 in Ireland? 19 A Can I ask you Certainly not particularly in the earlier days or 20 even the later days I am not too sure where I 21 fall within that scope. 22 218 Q 23 A 24 219 Q 25 A would Let me suggest three areas, one might be auditing? No, no auditing. The second might be insolvency? I only completed the insolvency assignments where I 26 had been appointed liquidator or receiver. We 27 discussed it in Haughey Boland and it was easier, I 28 could have resigned and appointed somebody else but 29 it was considered better for me to finish out those 1 2 220 Q 3 A 4 221 Q 5 A 6 7 They were personal appointments, yes. The third area might be financial services? I don't know what category that comes within or where that would be. 222 Q Mr. Stakelum, either you know that you had an 8 involvement at some point in your company's life 9 with the Institute, in terms of regulation and 10 meeting the regulatory requirements of the Institute 11 or you didn't? 12 A 13 14 That I had meetings with the Institute? I had no meeting with the Institute. 223 Q Sorry, I think you misheard me. You must know that 15 either you did come within the requirements of the 16 Institute in terms of their regulatory requirements 17 or you didn't. 18 A I have to plead ignorance but I am not sure what 19 their regulatory requirements would have been in 20 connection with financial services. But I can quote 21 you chapter and verse exactly what Business 22 Enterprises Limited did. 23 224 Q 24 A 25 225 Q We will get to that in just a moment? Yes . Can you please tell me what were the trading or 26 business names under which you have operated 27 businesses post Haughey Boland? 28 29 A Business Enterprises Limited was the cornerstone of all that. 1 226 Q 2 A 3 227 Q 4 A 5 Starting day one. 1975? Yes. I might have had the company incorporated a week or two beforehand. And being run down in 1998? 6 228 Q 7 A That's right. 8 229 Q The next one? 9 A I don't know if there is another one that I could 10 add to that but let me explain the peripherals. 11 There was a BEL Secretarial Limited. 12 from the Business Enterprise Limited, the initials. 13 That was incorporated with the purpose and view of 14 having it operate as secretary to companies and it 15 was certainly appointed as secretaries to some 16 companies. 17 never issued an invoice, if I may so, or anything 18 like that. 19 personnel in Business Enterprises Limited. 20 just a name to have there for that. 21 230 Q The BEL coming That has also been struck off but it The work was carried out by the It was Could I clarify whether the name of that company was 22 B. E. L. Secretarial Limited or was it B. E. L. 23 Secretarial Services Limited? 24 A The reason I am hesitating, I thought it was BEL 25 Secretarial Limited and may I go on about that. 26 B. E. L. Secretarial did nothing and was lying there 27 as a dormant company, until I was asked to take over 28 a situation for Mr. Haughey from Deloitte and I used 29 that company then. I believe it was B. E. L. 1 Secretarial Limited. 2 used Services but what I did then, and that was the 3 first time it had a bank account was, in connection 4 with an operation for Mr. Haughey that has been 5 fairly well publicised and then I closed that bank 6 account down in February, 7 I start to work for the Mr. Haughey thing. 8 231 Q 9 A I don't think I would have I don't know in '91 or '92 Did you wind the company up at the same time? No, no. B. E. L. Secretarial, would you believe that 10 I don't know the status of that company at this 11 stage. 12 off at the same time as Business Enterprises 13 Limited, probably in 1999 some time. 14 the bank account for it which was the only bank 15 account it ever had, 18 or 19 months after starting 16 with Mr. Haughey and put in B. E. L. Secretarial, 17 without a 'Limited'. 18 232 Q 19 A 20 233 Q 21 22 No I do, sorry, we asked for it to be struck But I closed Did you register that as a business name? Yes . Were you involved in any other business name trading entities ? A Well I had Clyde Enterprises and before that I had 23 Business Enterprises without the Limited and then 24 subsequently I had Raglan Enterprises and Elgin 25 Enterprises. 26 234 Q 27 28 29 Is an entity by the name of Secretarial Trust Company? A Does that mean anything to you? Oh, yes I would have been the instigator of that. 1 that; Haughey Boland being the auditors to a number 2 of clients we decided that it would be more 3 beneficial to have a secretarial company and 4 Secretarial Trust Company Limited was incorporated 5 as a company, way back in my days in Haughey Boland 6 & Company. 7 235 Q So Secretarial Trust Company was a Haughey Boland company? 8 9 A 10 236 Q 11 A 12 237 Q All right thank you. 13 238 Q You told us that one of the services you provided That's right. And you set your own business up you told me? December 1st '75. 14 under Business Enterprises Limited was that you 15 would act as a non-executive director on behalf of 16 your clients? 17 A 18 19 Depending on their wishes. I would have been a director of approximately 4 0 companies. 239 Q Did you every perceive that acting in that capacity, 20 that is as a non-executive director, presented you 21 with a conflict of interest if you were also 22 promoting that company to a bank in respect of 23 obtaining a loan for the company of which you were 24 the Director? 25 I fail to see even now where the conflict of 26 interest would arise. 27 director of AB Limited, in my capacity one of 28 functions is "look after our banking requirements; 29 go to see A.I.B or Guinness and Mahon or whoever in Clients ask me to become a 1 that capacity, seek for a loan, I fail to see a 2 conflict. 3 240 Q. 4 So the answer is you didn't see any possibility of a conflict? 5 A. 6 241 Q. No. Turning now to the early stages of your business. 7 We know that you continue to work on the insolvency 8 assignments which you had brought with you from 9 Haughey Boland? 10 A. 11 242 Q. 12 13 Yes. How long would it have taken you to have completed those, roughly? A. I think at the time there were about 42 or 43. That 14 has always stuck in my mind and I would believe that 15 forty of them might have been cleared within 12 16 months. 17 243 Q. So that besides that, how did you market your 18 business? 19 clients ? 20 A. One of them took about 20 years. How did you go about attracting new Before I left Haughey Boland and Company there were 21 clients that were making more demands on you than 22 just auditing work. 23 auditing work that they would come, 24 for much more additional involvement than an annual 25 audit or something like that and in going and 26 talking to, because there was a whole array of 27 situations when I gave notice, I gave 12 months 28 notice in Haughey Boland on my departure. 29 reached agreement on a number of issues, one It might have started with they would look We 1 obviously being that I wind up the insolvency work. 2 In addition there were a number of clients that 3 continued to be clients of Haughey Boland and 4 Company in the auditing capacity but now that I 5 would have handled on more general work that I was 6 involved in with them and they would have come to 7 me, without leaving Haughey Boland. 8 any auditing anyway. 9 244 Q I wasn't doing Does that mean that whenever you were leaving 10 Haughey Boland, all the clients that you dealt with 11 were written to say, by the firm, to say that 12 Mr. Stakelum was leaving? 13 A 14 245 Q 15 16 No. I don't think that happened. So it was a case of you knocking on their doors afterwards ? A I think in discussion with clients you get close to 17 clients in talking to them and I would have said 18 that I am proposing to leave here in 6 months time 19 or 12 months time or whatever the case may be. Some 20 of them would have indicated that they wanted to 21 continue to utilise my services. 22 question of discussing with Haughey Boland and 23 Company whether it was in order etc. 24 246 Q Right. Then that was a So that in essence, you may have been 25 consulted on, because this is what you indicated to 26 us last time, on helping them to raise money if they 27 needed money. 28 That would be one of the aspects of things, yes, 29 certainly. 1 247 Q. Were you also asked to help them if for instance if 2 they had a business entity which started to perform 3 badly? 4 A. 5 248 Q. Yes. That would have been the sort of thing that you 6 would have had to deal with in terms of receiveship 7 work? 8 A. 9 249 Q. Yes, rescue work. All right. Let me just change tack for a moment. 10 One of the things you said to us last time was that 11 you didn't advise on tax related issues and I think 12 you gave us the impression that tax was not 13 something with which you had a great deal of 14 knowledge? 15 A. I always had my own tax affairs handled by somebody 16 else. 17 Obviously there is a little knowledge that you gain 18 but tax is so complicated these days that it 19 requires specialist work. 20 tax because I didn't have that expertise. 21 250 Q. 22 I could not hold myself out as having. I never could advise on But we do know you would have studied some tax for your accountancy exams? 23 A. 24 251 Q. Surely That presumably, while you were a qualified senior 25 in Haughey Boland you would have had to have some 26 understanding of tax to do whatever tax related 27 activities were necessary as part of the accounting 28 audit procedure? 29 1 obviously had to get the backup. 2 would be sufficient knowledge to know where the 3 problems might lie but you would always be advised 4 by the specialist. You would have employed 5 specialists there. I couldn't give people advice on 6 even personal tax. 7 252 Q I suppose there But presumably you would have kept abreast of the 8 major events which were happening in terms of the 9 introduction of legislation by government. 10 know, the budget issues? 11 A 12 253 Q You mean the taxation issues? Yes. I was thinking about the changes which came about in 1974? 13 14 A 15 254 Q Capital gains tax came in then. Well, actually it was really about the transfer of 16 assets abroad legislation. 17 on you? 18 You A No. I don't remember. Did that have an impact I would probably as was 19 usual that immediately after a budget, seminars 20 would be arranged either by the Institute, like 21 breakfasts and lectures after breakfast for hours 22 or whatever or by Kennedy Crowley as it was, because 23 I was an ex-employee there which is now KPMG and 24 later on Deloittes and that and you would go to the 25 breakfast and you would listen to the changes but 26 you didn't absorb unless it was your particular 27 area. 28 In 1975 of course the Government introduced import 29 and taxation legislation? 1 2 256 Q. 3 You wouldn't be familiar with the capital gains tax legislation which was introduced in 1975? 4 A. 5 257 Q. 6 A. 7 258 Q. I thought that was the 6th of April '74. And the wealth tax? There was wealth tax introduced at some stage. Would these have been areas, Mr. Stakelum, 8 if you were dealing with business people and in some 9 cases wealthy individuals, they would have expected 10 11 you to have known about? A. I certainly never -- and nobody would ever be coming 12 to me to give them taxation advice but what I did 13 for clients was certainly if there were areas that 14 needed advice I was able to either bring them or 15 direct them to the place where they could get that 16 advice and I would have to do that I would often go 17 with them to get the particular advice. 18 259 Q. The information you are providing is that you didn't 19 keep abreast as a professional advisor of major 20 changes in statute as they affected tax? 21 A. 22 Certainly not, you are making me feel very incompetent here but I have to admit to that. 23 260 Q. 24 A. 25 261 Q. I am just trying to clarify the position? That's right. Going back then to business, you were helping your 26 clients raise money and you had been dealing with 27 Mr. Traynor and Guinness Mahon before you left 28 Haughey Boland and you had been putting client 29 opportunities his way so that meant that you had at 1 2 With him. 3 262 Q 4 A 5 6 With him? My relationship would have been far more, he was a close personal friend as well. 263 Q I understand. At the time did you perceive that 7 Guinness and Mahon had a particular interest in 8 lending money into any sector or sectors? 9 A No, maybe excluding -- they weren't interested in 10 running things like overdrafts. 11 thought probably fairly strong into property because 12 I certainly brought a few property situations there, 13 I think they were thrown out to tell you the truth. 14 264 Q 15 A I would have Property and maybe construction? I am thinking of clients that might have a 16 development project you know for construction, yes 17 maybe construction would be part of that and if the 18 concept was unusual I used to say that I turned down 19 more propositions than bank managers because people 20 would come and be referred to me by somebody else 21 and they would come with crazy schemes that, my God 22 if I brought them to any bank the 23 would come and take me away, so I turned them down. 24 But if I felt the scheme was a runner or if you had 25 an existing client that let's say was insisting on 26 -- and you did your best and put your best foot 27 forward in application to wherever you felt it would 28 be best received. 29 Generally speaking is that where clients were 59 white-coat-men 1 already with a bank that is the bank you dealt with 2 unless the nature of the financing was something 3 unusual. 4 265 Q You did make the point that difficult situations may 5 well have been resolved by an approach to Mr. 6 Traynor. 7 A Yes, in the sense that you could explain and he 8 would have recognised the source of me being honest 9 with some industry put into the effort and what I am 10 telling him to be true. 11 receptive ear of somebody with the authority to 12 recommend strongly if not direct a credit committee 13 to make a loan. 14 2 66 Q I would be having a But of course in putting forward these loan 15 applications your interest was your clients 16 predominantly? 17 A 18 267 Q It couldn't be anybody else, yes of course. If there was and I suppose there would have been a 19 business plan or something of that sort a 20 description at least of the intent of the project to 21 support the application? 22 A 23 268 Q 24 A Yes . Were there business plans as we might know them? Sure, each one would vary. You could be ringing up 25 and saying "Des, I want £10,000 on a short term 26 basis for so and so, would you instruct somebody 27 that that would be Okay", and that might be alright 28 but if you are talking about something very 29 substantial you would probably say, can I see you 1 and you would go down and see him and say listen I 2 have a concept of thinking, would this be a runner 3 with the bank and he might tell you fairly clearly 4 which is also a great advantage that it wouldn't be 5 because sometimes you can go through with bank 6 applications and discussions and find at the end of 7 the day that they were saying no but that were 8 always going to say no. 9 quickly, which would be helpful. So he could say no fairly 10 11 He might then say "well, you know, if you let me 12 have a,b,c,d,e whatever it might be and that might 13 include a business plan or a cash flow projection or 14 a profit projection or a schedule of assets or 15 whatever and then you would prepare that in that way 16 so there would be those things. 17 269 Q. How quickly after you started your own business did 18 Mr. Traynor raise with you the issue of supporting a 19 loan with a deposit elsewhere? 20 A. I really can't answer that, again that's purely a 21 question of looking back. 22 70's or 80's. 23 statement where you are talking -- if we are now 24 talking about back-to-backs as they were known. 25 270 Q. We are probably talking I think I would have said in my Well let me try and help you a little? You left us 26 with the impression last time that the predominant 27 part of your business was -- and incidently the 28 issue of insolvency work didn't crop up last time -­ 29 but the predominant part of your business was in 1 2 You also indicated that quite quickly after you 3 started perhaps one to two years, you then began to 4 place deposits with Mr. Traynor, which deposits were 5 deposited offshore so that -- and I may come back to 6 the question of deposits. 7 that the issue of deposits was then matched in your 8 mind with the issue of those deposits being tabled 9 to support the back-to-back loan? In the interim, was it I want to know 10 how quickly that issue was brought to you by 11 Mr. Traynor? 12 A. I have to say that I don't know that but it could 13 have been and probably was sometime in the 70's, 14 late 70's. 15 as I was only one month there on my own, so '76 is 16 out. 17 as if Mr. Traynor rang me up one day and said "Come 18 down Mr. Stakelum and you know that there are funds 19 abroad that can be used to secure a,b, or c. 20 don't see that happening at all. I mean I kind of discount '75 in so much The way your question comes across is almost I 21 22 I think I would have said in my statement, 23 personally I would be strongly opposed to what they 24 call back-to-back arrangements but you met the needs 25 of clients as best you could. 26 271 Q. Without wanting to seem impolite, we understand this 27 aspect because you explained it to us last time. 28 You see, you already explained to us that mostly 29 work flowed either from Haughey Boland or yourself 1 to Mr. Traynor and GMI and not very much of anything 2 flowed back the other way? 3 I am trying to think at the moment if there was 4 anything that came back the other way. 5 And that you only had a very hazy view of what 6 Mr. Traynor was doing in terms of his overseas 7 banking activities and GMCT and so on. 8 point along the line someone had to explain to you 9 the possibilities of doing a back-to-back situation, 10 At some that is what I am trying to understand. 11 A 12 273 Q Okay. How did all of that happen because it had to come 13 from Mr. Traynor because it couldn't have come from 14 you because you didn't know? 15 A I am trying to think to put this as clearly as I 16 can. 17 situations, of using funds that were somewhere else 18 would have been something that one would have known 19 about, maybe before I left Haughey 20 forget he had arranged a scheme which was 21 effectively an eye view, a back-to-back by lending 22 me £40,000, that loan that you referred to. 23 think that...(INTERJECTION) 24 274 Q 25 A I think the knowledge of back-to-back Boland. Don't Now I That is in 19? That was certainly when I was in Haughey Boland and 26 Company because I thought capital gains came in '74 27 and you said '75 earlier on but it would have been 28 finished at that stage because there was no further 29 advantage. What would have happened is clients 1 certainly approached me and asked me to -- now, I 2 don't want to use the word monitor because 3 Mr. Costello didn't like that word -- to handle 4 their funds, record, reconcile, I am not sure what 5 words to use, which would have been handled through 6 Guinness Mahon. 7 Mahon Caymen Trust. 8 answer to that now because of other developments 9 that have taken place since but I believe that. Let me say, I believed Guinness I believed and I don't know the 10 11 That part of my business was tiny. 12 viewed it almost as a business, it was a convenience 13 or a facility offered to clients that looked for 14 that. 15 part of my business was organising loans. 16 course, I organised loans and for the companies that 17 I was involved in I don't think, you know that that 18 would be a big function but if you then came along 19 and said to me "How many loans did you organise in 20 '84", it may have been two, I don't know because 21 there was a whole pile of other work that was done. I wouldn't have I am even regretting saying that the major Of 22 23 I think what would have happened there is that there 24 would have been funds placed abroad with Mr. Traynor 25 and at some stage some client or other is looking 26 for funds and Mr. Traynor is saying what about the 27 possibility of using the funds as security. 28 am not going to swear to that because I don't know 29 that that's the way it happened. Now, I 1 275 Q 2 3 But it is likely that the idea was promoted by Mr. Traynor, is it not? A It certainly is in the sense that I wouldn't be 4 generally in favour of that. 5 situation of financing. 6 276 Q 7 8 A That is the only one I can think of, we are talking about...(INTERJECTION) 277 Q 11 12 You told us to the best of your knowledge you could only think of one situation, was it Mr. Keane? 9 10 That was a last resort Beside your own one of course which of course preceded your business? A Yes, and wasn't the same at all. That certainly 13 wasn't the same at all. 14 had abroad confidentially, that was a situation that 15 I would have known nothing about until he suggested 16 that to me. 17 278 Q 18 A That wasn't funds that I Right. That is the one I can think of. It may be that out 19 of woodwork some other one would come but I am not 20 sure . 21 279 Q All right. Then let me summarise where we are at 22 and let me say that I do appreciate that this is 23 quite a long time ago and I am not going to try and 24 ask you to remember things absolutely to a month or 25 even to a year because I recognise that that is 26 going to be very difficult unless one has something 27 more concrete to put forward. 28 29 1 of the '70's you were helping your clients to raise 2 loans and you were helping your clients also to deal 3 with some monies which they had either already 4 abroad or which they wished to deposit offshore and 5 then arising from those two activities you learned 6 from Mr. Traynor about the possibility of supporting 7 a loan in Ireland with a back-to-back deposit in 8 Caymen or somewhere else in the second half of the 9 '70 's? 10 I think that is an accurate summary of the 11 situation. 12 280 Q At our last interview we spent sometime talking 13 about the situation where one of your clients said I 14 have some overseas money and it is somewhere outside 15 of Ireland and the client said to you look, 16 Mr. Stakelum I would like you to monitor, may I use 17 the word manage? 18 A 19 281 Q Yes . As opposed to monitor, might we understand that a bit better? 20 21 A 22 282 Q Yes . To manage this money for me and what we understand 23 from that Mr. Stakelum is that he wanted to make 24 sure he was getting the best rate of interest on his 25 money or if there was other issues of an investment 26 or taxation nature that he was doing the best he 27 could with his capital? 28 29 A No. 1 Absolutely not because that would give a 2 connotation that I would be giving advice about 3 investment and I never did that because you were on 4 a hiding to nothing. 5 stockbroker or anything like that. 6 to a client, you should do this or you should do 7 that or you should do the other. 8 me the instructions. 9 funds were purely on deposit. 10 I wasn't a qualified So I never said They totally gave They understood that their I would have advised them about rates available of deposit, that was it. 11 12 In some cases some clients asked me to buy shares 13 for them, public company shares, which I did, if 14 they so instructed. 15 would buy the shares and in many cases, no, now that 16 is not true, in one particular case I was abhorred 17 about share purchases. 18 284 Q I instructed whoever it was who Sorry, we are digressing a little. Let me just keep 19 you to the point. 20 and he said look I would like you to manage this for 21 me by way of getting me a better rate of interest? 22 A 23 24 Somebody had some money abroad I doubt if the conversation was like that, but carry on. 285 Q 25 That was the nub of it, would it not be? You looked around...(INTERJECTION) 26 A 27 286 Q Well, I think there were other factors but go on. You looked around and you found that there may have 28 been a number of options, one of which might have 29 been GMCT, so, having established that you would put 1 these options in front of your client and say which 2 of them are you going to select or would you have 3 said that there makes more sense? 4 No. 5 287 Q 6 A How would you have done it? I will tell you how I believe I would have do it, I 7 would have said -- there are other reasons for 8 looking after monies and monitoring or managing as 9 the case may be, from just the interest rate, but 10 letting that one go for a minute, what I would have 11 said I think is that Guinness and Mahon have an 12 offshore operation. 13 can handle the funds through and it would be up to 14 them to decide whether or not they transferred to 15 there. 16 presenting them with options. 17 288 Q That is the only place that I I wasn't aware of other options or So you explained to people that Guinness and Mahon 18 had an offshore option. 19 with some sort of an information sheet about 20 Guinness and Mahon's offshore option? 21 A 22 289 Q 23 A Did you then present them Absolutely not. No? In all the funds that I got over all the years from 24 all the clients never once did I give them a piece 25 of paper acknowledging that I got the funds. 26 the years, in all the clients passing back their 27 funds, I never asked for a piece of paper to 28 acknowledge that they received them back. 29 a situation where people trusted you and that was In all This was 1 2 290 Q 3 4 recommendation? A 5 6 So, effectively they trusted you to make a About what? They would have been aware that their funds were going on deposit in a bank. 291 Q Yes and that as far as you were concerned you 7 believed that was first of all a solid institution 8 and that it was presenting the best interest 9 opportunity for them? You were recommending it, 10 because they had nothing else to go on except your 11 recommendation? 12 A They were getting the value of my service in the 13 situation and that was being handled through 14 Guinness and Mahon who were a bank. 15 occasional fight with Guinness and Mahon on their 16 interest rates and sometimes they weren't as good as 17 other people but that was the package, it was 18 Guinness and Mahon they were getting and that was a 19 bank. 20 292 Q 21 A 22 293 Q 23 A I had the And you had...(INTERJECTION) And their funds were just on deposit. And you recommended it? The truth is, if you really want the truth, I 24 wouldn't have recommended any of it, because it was 25 a nothing for me, it has proven a hell of problem at 26 this stage in my life having got rid of it and I 27 didn't make any money out of it. 28 along and approve this or recommend it. 29 a facility that they looked for. So, I didn't come I provided 1 294 Q 2 Did you every recommend any of your clients to put money into merchant banking? 3 A 4 295 Q No. All right, thank you. Last time we discussed this 5 matter you explained that you thought the issue of 6 dealing with clients deposit, perhaps arose as an 7 issue made from some clients who had money abroad 8 and they wanted to organise it differently and you 9 would have -- because the money was abroad and you 10 knew that Mr. Traynor was dealing with offshore 11 interests, you would have gone along and talked to 12 him about that situation and having thought about it 13 he would have recommended a course of action. 14 thought about it and you felt it was appropriate and 15 you would have gone back and suggested that to your 16 client. 17 recommendation then Mr. Traynor would have provided 18 routing. 19 instructions, 20 was in your clients control into Mr. Traynor and in 21 GMCT's control, is that right? 22 A 23 296 Q If your client was inclined to take your I think was the word you used, for how the money got from wherever it That's right. Routing instructions. I want to explore those 24 routing instructions with you. 25 Mr. Traynor with your clients name? 26 A 27 Did you provide I can't remember specific instances but by and large he wouldn't have known the names. 28 297 Q 29 A You Yes, that is what you said. 1 298 Q. 2 May I assume that it was unlikely or less likely that he didn't know your clients name? 3 A. 4 299 Q. 5 A. 6 300 Q. Less likely. But he might have? He might have. He would have said to you, would you ask your client 7 to lodge his money to a particular bank, account 8 reference this, isn't that right? 9 A. 10 301 Q. That's right. So, that is all your client knew, that he had sent 11 money to a particular bank of Mr. Traynor's and that 12 thereafter you didn't worry about it and your client 13 didn't worry about it because Mr. Traynor looked 14 after it? 15 A. 16 302 Q. 17 A. 18 19 So, you didn't know where the money had gone? No, I mean, I would have known with the instructions, the first receiving back that we got. 303 Q. 20 But that probably wouldn't have been Guinness and Mahon Caymen Trust Limited, would it? 21 A. 22 304 Q. 23 24 Yes. Probably not. You said last time that there was usually an intermediate? A. I think that's the way they operate, I guess if I 25 rang up somebody or somebody asked me to transfer 26 £10,000 from the bank of Madrid in Bilbao or New 27 York, I would have to get moving instructions and it 28 would probably go through other banks along the way, 29 because they were receiving banks we had. 1 305 Q. Let's suppose that this money started off in your 2 clients control in dollars. 3 dollars to GMCT and if it was felt that it was 4 desirable to retain it in dollars then there was 5 presumably opened a dollar account in GMCT, yes? 6 A. 7 It moved through in Well, yes I presume if they took dollars and kept dollars they had a dollar account, yes. 8 306 Q. 9 A. 10 307 Q. 11 That's all I am asking you? Yes. What sort of record did you keep of that transaction? 12 A. 13 308 Q. 14 A. 15 309 Q. 16 A. 17 310 Q. 18 Very same as any other. So, you kept a dollar account? Dollar and sterling. Pardon? Dollar and sterling. Yes but in this case we are just dealing with dollars, you kept a dollar account? 19 A. 20 311 Q. Yes. Let me suppose another client came along to you and 21 said I want to transfer Deutschmark, the same 22 process and you kept a Deutschmark account? 23 A. 24 312 Q. 25 A. Yes, except I don't think I every had one. And somebody else a French Franc account? I think I only had two accounts, dollars and 26 sterling but it is possibly at some stage I may well 27 have had, I don't know. 28 29 313 Q. On that point you have told us that you had no idea 1 reference numbers of those accounts maintained by 2 Mr. Traynor? 3 No, I now realise I don't even know where the money 4 was but I mean...(INTERJECTION) 5 314 Q 6 A That is the second point? I think I would have had a reference or some code 7 reference but I can't remember. 8 wouldn't have been what was shown to me there. 9 315 Q 10 11 It certainly Would you try and think back please and tell me what sort of code reference you might have had? A I think you asked me this the last day and I figured 12 it was probably an initial and a number but I just 13 don't know. 14 316 Q Mr. Traynor? 15 16 Do you think you had some code reference for A I guess so, I think so, yes. You see you made 17 reference to the fact of how do you identify when 18 you ring up to get your monthly balances and the 19 likelihood -- first of all they would have known and 20 what account it was but I might have said something 21 like I wanted a balance on B7 or -- I don't remember 22 what that code was. 23 317 Q I am prepared to accept that you may, you believe, 24 have been given some sort of reference code from 25 Mr. Traynor? 26 A 27 318 Q Yes . We have been speaking up to now about money, your 28 clients money, which was already overseas and it 29 moved from some overseas bank into the control of 1 Mr. Traynor and you believe that probably meant that 2 it was with GMCT? 3 A. 4 319 Q. 5 A. 6 320 Q. 7 A. 8 321 Q. 9 Pardon? I did believe that. You did believe that? I am not sure I believe it now. What about clients who had money available in Ireland which they wished to put into a good 10 11 I did believe. investment ? A. If they wish to transfer Irish pounds abroad, I 12 think at a stage, at an early stage, there was no 13 problems about that because I think the pound and 14 the sterling were one of the same and that there was 15 no restriction on sterling so it could just be moved 16 abroad offshore. 17 problem and the only way that that could be done 18 would be to supplant and replace funds. 19 wanted to take funds back from abroad and somebody 20 wanted to put them out, you could do it by journal 21 entry. 22 322 Q. At a later stage that was a If somebody Before we get to that, if someone had a sum of money 23 which they wished to put on deposit as their advisor 24 you had a number of options open to you, you could 25 have advised them to deposit it in Ireland or you 26 could have advised them to deposit it offshore. 27 you were talking about advising them to go offshore 28 it could have gone offshore with a number of other 29 organisations who provide offshore facilities or it If 1 could have gone through GMCT, how did you decide 2 when advising your clients which was the most 3 appropriate? 4 A. They weren't options that I perceived as being 5 available at that time. 6 situation through Guinness and Mahon where there 7 were offshore funds, unless it was an initial 8 lodgement for a client he might already be in that 9 Hotchpotch account, so to speak. 10 323 Q. 11 12 Anyway what I had was a I am talking about a client that hadn't any previous involvement with Guinness and Mahon? A. I don't know what the circumstances was but in the 13 situation, it wasn't a question of sitting down and 14 putting various options to clients about whether he 15 would invest here or away. 16 instruction from a client that he wished his funds 17 to be placed offshore. It would be taking 18 19 So, I didn't had an option of saying well you really 20 should go down the road and put that on the Trustees 21 Savings Bank or something. 22 instruction and he would be aware that I was 23 operating through Guinness and Mahon. 24 offering or indeed aware of other options that might 25 be available to me if he wanted to put funds 26 offshore. 27 28 29 324 Q. I would be taking an I wouldn't be Your client would be aware that you were operating through Guinness and Mahon? 1 325 Q In effect if you had a client who wanted to put 2 money offshore you advise them to put it through 3 Guinness and Mahon? 4 A 5 I would do it. 6 326 Q 7 A 8 327 Q 9 A 12 328 Q 13 A 14 329 Q 15 A 16 330 Q 17 A 18 331 Q 19 A 20 332 Q A Probably in cash. As in notes? As in notes, yes. Large sums of money in notes? Well, there might have been tens of thousands. All right, large sums of money in notes? Yes . What happened then? They would have been lodged to, let's say Clyde Did you open the Clyde Enterprises Account fairly No, but I had one previous to that, Business Enterprises. 333 Q 26 Right. So, the money that was put into Clyde Enterprises ? A 28 29 Your client early on in your business? 24 27 You got the sum of money, would you explain to me Enterprises. 22 25 Yes . produced the money in what form? 11 23 That's what we are talking about isn't it? the process please from that point on. 10 21 Yes, if he was asking me to handle it that's the way Or Business Enterprises maybe, yes. Let's assume the sum of money was £10,000. 334 Q Yes? 1 It would be lodged in there and I could only say, 2 and this is post the time when it was no longer 3 possible to transfer funds abroad. 4 335 Q 5 A Yes . I would be saying to the client, if and when I have 6 an opportunity I will transfer that abroad and when 7 an opportunity presented itself where somebody might 8 ask for £6,000 in cash I would draw the £6,000 in 9 cash. 10 336 Q 11 A Out the £10,000 that you had received? Yes, and then do a journal entry for the abroad sums 12 crediting one client with the £6,000 and debiting 13 the -- subject to whatever the exchange rate was 14 etcetera. 15 337 Q 16 17 You had to tell Mr. Traynor? A 18 19 No, I had not. I most certainly had not. Why would I tell him. 338 Q Because you had just taken a new deposit which was allegedly going t o ...(INTERJECTION) 20 21 But you had to do a bit more than that didn't you? A Into my Hotchpotch Account. He wouldn't have know 22 about it, I most certainly did not tell him and 23 that's why he couldn't know. 24 wouldn't have changed in balance, how would it 25 change. 26 So, you explained to your client when he was 27 presenting you his £10,000 that you were going to 28 invest this on his behalf in an offshore account 29 with Guinness and Mahon. The Hotchpotch Account Did that not mean that you 1 2 No, it did not. 3 340 Q 4 A 5 341 Q 6 A 8 342 Q 9 So all Mr. Traynor knew was that every so often you That wouldn't involve a tranche of money. But we do know that every so often you withdrew some money. 10 A 11 343 Q 12 Yes, I did. Every so often you requested some money from Mr. Traynor? A 14 15 Absolutely not. sent him a tranche of money? 7 13 No? If the clients requests for funds were -- if I didn't have funds to meet what their requests were. 344 Q Yes. I am intrigued then because somewhere along 16 the line the accountancy doesn't work. 17 Mr. Stakelum, if you never transferred money to 18 Mr. Traynor did Clyde Enterprises have money with 19 Mr. Traynor in the first instance. 20 A Somebody has got lost in this thing. How Clyde 21 Enterprises never had money with Mr. Traynor, never 22 had. 23 345 Q 24 A 25 26 Never had? Never had and I am not sure where you are losing the plot here Mr. Rowan. 346 Q Try and help me because I understood -- let me put a 27 big idea to you -- I understood that you encouraged 28 your clients to put money into GMCT to avail of 29 whatever the advantages of doing that was? 1 I have to question your "encourage", I did not but I 2 was asked to facilitate him by doing that. 3 Encourage them is that wrong word. 4 347 Q 5 6 Would you explain to me then please how that was done? A Yes, I will. Let's take the simple situation, let's 7 assume that there is an account in existence in 8 GMCT . 9 348 Q 10 A 11 349 Q 12 A 13 14 I find that hard to explain. I am finding it even harder to understand? There is an account in existence, the Hotchpotch account. 350 Q 15 16 What do you mean by that? How did it start what was the first transaction that started it? A Okay, I don't know what the first transaction was 17 but let me speculate may I, it was possible that a 18 client came to me and said, 19 abroad I would like you to monitor them", or in your 20 terminology, manage them, or reconcile or whatever, 21 control them or whatever the word is and "I am not 22 comfortable with wherever the funds are for what 23 ever reason" and there may be many reasons why he 24 might not be and I would maybe have said at that 25 stage, 26 operation and I can arrange to have the funds 27 transferred to Guinness and Mahon and I would look 28 after them for you from that point on. 29 "Jack I have funds "Well, Guinness and Mahon have an offshore 1 We talk about what the interest is, the only thing 2 that I would have told them was that the money goes 3 on a bank and it goes on deposit but they probably 4 were aware that it was Guinness and Mahon that I was 5 talking about. 6 was Guinness and Mahon Caymen Trust as I suspected 7 or College Trustees or whatever which maybe it was 8 that I didn't know until recently. They would not be aware whether it 9 10 I would say I'll have to find out how I get a 11 routing for this. 12 initially have talked to Mr. Traynor and said; "I 13 have a client with foreign funds, he wants them 14 transferred into a situation where I would look 15 after them and what are you going to do for me?", 16 and he would say "Look you transfer them here and 17 here is the routing situation. 18 give instructions to Royal Bank of Scotland in 19 Jersey or wherever. 20 where they are under his control to transfer X 21 pounds maybe to Guinness and Mahon London, Account 22 Caymen, reference number XYZ, I don't know what 23 those instructions would have been. 24 back to the client and I would say "Here there is 25 your instructions now, you give instructions to 26 your bank whoever the authorised signatory is on 27 them and that's where the funds have to be moved to 28 and when they are moved tell me and I will tell 29 Guinness Mahon and then Guinness Mahon presumably I would probably, undoubtedly The client has to He has to give instructions I would come 1 did whatever they do with those bank funds. 2 suit them to use half them there in London and the 3 other half in Hong Kong but they would finish up 4 giving credit, presumably in GMCT and that's number 5 one point of a Hotchpotch Account because that would 6 have happened on a number of occasions and they all 7 finish up in the same account. 8 351 Q. 9 10 It may So, the Hotchpotch started with funds that were already abroad? A. Yes, so, I believe, incidently it is possible that 11 somebody came in at a stage, and I didn't know this, 12 when exchange control regulations started that you 13 could transfer funds from Irish currency into 14 sterling and there was no restriction on sterling. 15 I don't know exactly how that started it is aeons 16 ago and that. 17 352 Q. If in fact the Hotchpotch Account started with 18 overseas money, let's suppose that the Hotchpotch 19 Account started with five hundred thousand pounds, 20 then providing you never needed to withdraw more 21 than five hundred thousand pounds the system worked 22 because each time you got a new deposit in Ireland 23 you put that into Clyde Enterprises and while you 24 had money in Clyde Enterprises you could repay 25 people who wanted to withdraw, yes? 26 A. 27 353 Q. Absolutely. If in fact the people who started the Hotchpotch 28 Account, the five hundred thousand, if they wanted 29 to withdraw that amount then you had a problem 1 2 A. I don't know where I have a problem, where have I a 3 problem there? 4 clients give you money they had it and they wanted 5 to withdraw they got it back. 6 354 Q. 7 A. 8 355 Q. 9 What you are talking about if Yes? No problem. Yes, but I think you might accept that if you exclude any new deposits that once the five hundred 10 thousand pounds that started it all had been 11 withdrawn here in Ireland, then the Hotchpotch 12 account would have been zero? 13 A. 14 356 Q. 15 A. 16 357 Q. 17 A. 18 19 That's right. If it got to zero? Yes. New deposits in Ireland? That's right I wouldn't be able to make further deposits, 358 Q. I agree with you, yes. So effectively while that didn't happen, while the 20 amount that was originally used to create the 21 Hotchpotch Account, in effect when people gave you a 22 new deposit you lodged it in the AIB, in Clyde 23 Enterprises, if somebody wanted a withdrawal you 24 gave hem a withdrawal and as far as they were 25 concerned they had money on deposit with Guinness 26 and Mahon offshore? 27 A. 28 359 Q. 29 Yes, I would say that is a reasonable conclusion. But if fact they had money on deposit with Clyde Enterprises ? 1 No, no, no, no. 2 account, Clyde Enterprises merely had a current 3 account and let me tell you some of the 4 restrictions? 5 say the £10,000 and they wanted it placed abroad I 6 would have to say to them, this is assuming that 7 there are exchange control restrictions in at that 8 stage, I would have to say to them, 9 opportunity arises I 10 Clyde Enterprises had no deposit When people came with me, with just "if and when the will place the funds abroad for you". 11 360 Q 12 A 13 361 Q 14 A That might have been a month later? It might have been a month later. What did they do for the interest? They were quite happy to understand and I explained 15 to them in detail, until such time as the money went 16 on deposit abroad they earned no interest. 17 362 Q 18 A Did you explain this to them? I did and furthermore you would have the situation 19 where it wouldn't be black and white that if they 20 gave £10,000 they might get £6,000 abroad in a week 21 and it might take them another month to get the 22 other £4,000 or it might be £3,000 would get in 23 another fortnight and the other £1,000 might be 24 another month and that would be explained to them 25 and understood. 26 27 I have and still enjoy a great trust relationship 28 with my clients and they understood it and I made 29 nothing out of that because it was on current 1 2 363 Q 3 A 4 364 Q 5 A Why? Why. Why not put it on deposit? Very simple. If I put that on deposit I would have 6 to explain where it came from and that wouldn't be 7 part of the confidentiality of the funds. 8 365 Q 9 10 Because you had it in a current account you wouldn't have to explain it? A I wouldn't, who would I have to explain it to? If 11 it was on a deposit account it would earn interest 12 and attract attention. 13 3 66 Q 14 A 15 367 Q 16 A Attract attention? Yes . Just explain that to me? Well the Revenue would be aware of it for a start 17 off, of the funds, that there would have been 18 deposit interest earned and there would be returns 19 of that made by the banks at those stages. 20 368 Q 21 22 that into your current account? A 23 24 Clyde Enterprises current account, yes, which was mine, I owned Clyde. 369 Q 25 26 So, once you took a new deposit of £2,000, you put Yes I understand. You didn't need to tell Mr. Traynor he didn't need to know that? A Not alone did he not need but he would never have 27 been told and secondly he wouldn't have the remotest 28 interest, what interest would it be to him? 29 370 Q 1 2 3 371 Q. All right. Leave those aside. Earlier on I give 4 you some instances about money coming from a dollar 5 account and being held in a dollar account and some 6 more money coming in a different currency and being 7 held in that currency, how can all of that have been 8 recorded in a single Hotchpotch account? 9 A. It couldn't. There could have been two or three 10 Hotchpotch accounts. 11 dollar and sterling were segregated. 12 think 13 sterling or sterling to dollar, that would have been 14 their decision so you would be switching from one 15 Hotchpotch to another. 16 372 Q. 17 I can only remember two, At stages I clients asked me to switch from dollar to Taking Mr. Keane for instance, Mr. Keane had a back-to-back? 18 A. 19 373 Q. Yes. The way Guinness and Mahon had the back-to-back set 20 up was that the offshore deposit had to be known and 21 matched against the lending that Guinness and Mahon 22 provided, 23 two? 24 A. 25 374 Q. so there had to be a linkage between the Yes. The deposit was hypoticated, i.e., it couldn't go 26 anywhere while the loan remained outstanding, 27 was Mr. Keane's deposit dealt with in the light of 28 what you have been explaining and in the light of 29 what I just told you? how 1 I don't know specifically but if I can tell you what 2 I believe would have happened, 3 have moved the appropriate amount out of the 4 Hotchpotch Account to a specially identified 5 account, probably. they would probably 6 375 Q How would that have been recorded in your records? 7 A No, need for it or I may have done the same thing, may have taken.. . (INTERJECTION) 8 9 376 Q 10 A Which is it Mr. Stakelum? I suppose I probably did the same thing, but the 11 same thing in my book would be a very simple thing 12 where I have a schedule of deposits and I merely 13 split Mr. Keane's deposit, 14 £100,000 and they wanted to back £80,000, 15 probably have described Mr. Keane as £20,000 free 16 funds and £80,000, 17 hypoticated. 18 I 377 Q let's assume that he had I would if you want to use the word How would you known about that? Somebody would have 19 had to have explained that for you from the Guinness 20 and Mahon side of things? 21 A 22 378 Q Sure I would have arranged his loan. It would be all explained to you that while the loan 23 was outstanding he couldn't touch that element of 24 his deposit. 25 A 26 379 Q Yes, that doesn't take a lot of explaining. Forgive me, I don't know how it worked, I am trying 27 to get you to explain it to me, 28 Mr. Stakelum that you would have known about the 29 back-to-back situation because on the one hand you so now I understand 1 knew about Mr. Keane's deposit and on the other hand 2 you knew because you had negotiated his loan? 3 That's right. 4 ever in the premises of Guinness and Mahon in his 5 life, 6 380 Q 7 A 9 381 Q 10 A he may have been. For placing all this business with Guinness and Mahon, 8 I have my doubts if Mr. Keane was did you earn remuneration? From Guinness and Mahon. Yes ? Quite the reverse. No, I did not and eventually I 11 left Guinness and Mahon because their charges were 12 too high. 13 382 Q You didn't earn any remuneration from Guinness Mahon 14 or Guinness Mahon Caymen Trust or any other related 15 entity controlled or directed by Mr. Traynor? 16 A 17 383 Q No. Did your remuneration then come from your clients? 18 I don't need to know the detail, 19 answer to that question? 20 A I just need the The answer to that -- any remuneration that was 21 there came from the clients but it varied greatly 22 and it barely covered costs and eventually wasn't 23 covering costs so that is why I moved out of 24 Guinness and Mahon. 25 384 Q 26 27 So for providing all of these management services you traded at a very modest if at all surplus? A Well, for all of these management services, Mr. 28 Rowan, 29 were only deposits earning interest and a it was a relatively simple operation, there 1 reconciliation once a month, 2 Number two, Guinness Mahon made the charges not me. 3 They had charges for this that and the other, 4 is nobody like banks to be able to make charges, 5 that's number two. 6 used foreign deposits varied and there were 7 different kinds of categories. 8 friends or relations that weren't charged, 9 I was acting for in Business Enterprises Limited 10 anyway and charging fees to Business Enterprises 11 Limited where there was no additional charge and 12 others that were in neither of those categories that 13 I would have charged to cover costs. that's number one. there Number three, my clients that Some very close some who 14 15 One of the things that hasn't been understood and I 16 recognise that your inquiry is necessary on these 17 things, 18 involved in. 19 trying to earn money for Business Enterprises and 20 this was nothing. 21 eventually moved out of Guinness Mahon because they 22 made some extra special charges and eventually gave 23 all the money back to the clients because it was no 24 good to me. this was a tiny percentage of what I was I was busy doing things all the time It was a nothing so much that I 25 26 Therefore when you talk about whether I had an 27 account personally, I hadn't an account personally 28 in Guinness Mahon. I could have used the facility 29 to draw some dollars periodically for this but it 1 2 3 So, 4 investments, 5 put on deposit and the only other service to that 6 where they asked me "Can you buy shares with those 7 funds if you want to?", and they gave the 8 instructions "Buy AIB shares" or anything you want. 9 385 Q 10 A 11 386 Q it wasn't managing all these funds, it wasn't it was your money that they wanted to Thank you very much? That was my involvement. Okay. Ms. Mackey wants to pick up a matter with you 12 I hope will not be very long, 13 is ten past one and we should be trying to take a 14 break. 15 A 16 387 Q 17 A 18 I am conscious that it Are we coming back after lunch. I am hoping that we can avoid doing that. My solicitor has to leave at half one. MS. MACKEY: We should finish in ten 19 minutes. Basically Mr. 20 Stakelum, because matters had gone on so long this 21 morning, we haven't got around to the question of 22 your clients at all and that is something that will 23 take some time. 24 do that today, unless we come back after lunch and 25 since you weren't prepared for that I think the 26 better option would be to ask you to come back 27 another day to do that. 28 what will happen on the next day if I could suggest 29 something to you now. It seems to me that we if we can't We will be able to shorten 1 2 388 Q First of all you give us a list of clients on the 3 last day that you were here, 4 be a full list? 5 A that doesn't appear to It is as full as I can come up with at the moment. I would have -- like all the records were destroyed. 6 7 389 Q 8 A 9 Yes? I am open to the fact that there may be other ones but where I had to work from, if I may, is work from 10 the fact where I disengage with clients in '97/'98 11 and some earlier than that, because all the records 12 were destroyed. 13 and worked back and said who was there in the days 14 of the Guinness and Mahon runs and who were there 15 subsequently in AIB. 16 390 Q 17 18 Look at closing transcripts of them Basically are you saying that this is all that you can remember but there may well be others? A Well, I mean you can produce documents to me that I 19 can't remember anything about and maybe you can do 20 that, that is possible but there is no client or 21 name deliberately left off that list. 22 391 Q That is what I am asking you but is it possible that 23 if we were to put other names to you, 24 recollect them? 25 A 26 392 Q Absolutely. Well what I would like to ask you to do if you 27 would, 28 given us? 29 you might in respect of all the names that you have 1 If before our next meeting you could provide us in 2 written form with the particular services that that 3 client had in Ansbacher. In other words, 4 the client had a deposit, whether they had a 5 back-to-back loan and any detail that you can give 6 us of that person, 7 amounts but any detail of the deposit, when it was 8 opened and when it was closed, 9 A whether except amounts, we don't require Can I just say, Ms. Mackey, insofar as you can? here I have no way of 10 knowing that and all I could do is go back to the 11 client in question and say when. 12 that route without a lot of success and that's all I 13 could do in connection with that. 14 about the date that is was open. 15 service that is given is simple, 16 clients and say, no back-to-back because I had very 17 few of them. 18 394 Q 19 A I have been down You are talking You see the I could look at the Could you do that? I will certainly do that and the dates of when they 20 were opened. 21 the clients on that list were opened at or before 22 the mid 80's . 23 395 Q 24 A 25 26 All I can say is that I believe all of Yes ? Do you know, because I think after that I was moving to get myself out of Guinness and Mahon. 396 Q For example could you tell us in respect of each of 27 them whether they were clients who already had 28 monies abroad or clients who came to you with Irish 29 money wishing to put it abroad. 1 Some are in both categories, 2 mean? 3 Could you make your best estimate, 4 you are uncertain certainly but it would help us to 5 have whatever information basically you can give us 6 about each of those clients because otherwise I will 7 have to go through them one by one and ask you 8 detailed questions? 9 A 10 11 do you know what I you can say that Let me tell you that I might say things that the client would say the reverse. 398 Q That may well be and if that is the case we will 12 have to look at what the client says and what you 13 say and see which o n e ...(INTERJECTION) 14 A particular client about something else. 15 16 399 Q 17 A 18 19 I know that there is two different memories from one Absolutely. Some clients believe that they gave me money before I had set up in business and they didn't. 400 Q I see, yes. Also there are a number of other names 20 if I could just mention them to you now and if you 21 might jot them down and indicate to us whether these 22 people were or were not your clients and what other 23 information you have about them. 24 A 25 401 Q Yes . I will just give you the names now. Anthony and 26 Brian Rhatigan, 27 believe was your secretary at some stage? 28 A 29 402 Q John Byrne, Mrs. D. Leydon who I No. Is that incorrect? 1 No, that is incorrect. 2 Mr. Leydon that lives...(INTERJECTION) 3 403 Q 4 She is a widow woman from a Is she related to the Michael Leydon th at .. . (INTERJECTION) 5 A 6 404 Q 7 A 8 She is his wife. I see. Sorry, Anthony and Brian Rhatigan you gave me somebody else? 9 405 Q 10 A 11 40 6 Q John Byrne. Yes . Well, Mrs. D. Laydon anyway, 12 you know about her. 13 Moynihan, 14 Cooson, 15 A 16 407 Q you can just say what Brendan Deignan, Niall Moriarty, Michael Harold Lindsey, Chris Joseph Sealy who was your colleague? He was my colleague. Frank Glennon, Douglas Armstrong and then two 17 company names, if you could explain 18 were your clients and (B) if so who the beneficial 19 owners of company was, 20 and Warehousing and Distribution Ltd. 21 mentioned Connor Stakelum, 22 you would put him on the list as well. 23 mind then and this would also expedite matters, 24 you could also list for us separately all the 25 companies of which you were a director? 26 do your best with that? 27 28 29 A (A) whether they Diagem International Ltd., Also you a cousin of yours, so if Would you if If you can I have lists of former and current but how complete they would be. 1 2 Stakelum, will have, or 3 companies of which you were a director will have 4 made returns to the registry of companies and at 5 lest for part of time you would have been expected 6 to have indicated what other directorships you had? 7 A. I have a couple of those lists but I am not sure 8 what goes back. 9 MS. MACKEY: 10 Whatever you got back Mr. Stakelum, 11 mind. 12 MR. ROWAN: if you wouldn't Would it be good to make another date today? I don't think so. Mr. Stakelum I think what I 13 14 would like to suggest to you is that we would be 15 obliged if you could get this information to us at 16 your earliest convenience and once we have received 17 that then we will be in contact with you with a view 18 to reinstating this interview because effectively 19 this interview is being adjourned today and it will 20 be reinstated at a time which will have a 21 relationship to whenever you provide us with the 22 information. 23 A. 24 25 Yes, it wouldn't take long anyway. MS. MACKEY: A. So is that okay? I don't think that will take very long, maybe Monday 26 or Tuesday I would have that information back to 27 you. 28 29 1 interview is being adjourned now. 2 coining in Mr. Stakelum. 3 A. Thank you. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW WAS THEN ADJOURNED Thank you for at? 5 \Xx?zux 3 rix 0 Appe?aix'xv?iml) A M tm b tr H e a irA m b te h a ri Please reply to: 42 Fitzwilliam Square, Dublin 2. ■tel: 765144/763065 Fta: 612035 P.O. Bern887. Onnd Ccynan. Bricbh Wot Indies Phonr. (809)949-465V4 Tdex: CP 4305 Fu: (809) 949-7946 (809)949-5267 15th January, 1990. H. Lanigan O'Keeffe, Esq., Managing Director, Guinness A Mahon United, 17 Collage Green, DUBLIN 2. Dear Martin, Could you please arrange to let ne have a Sterling Draft in the a n of Stg.£5,000 payable to Denis Jackson and debit Ansbacher Account Nb.13154602. I would like to collect this Cfcaft on Wednesday naming please if possible. Yours sincerely, J.D. Traynor. 1 Appendix)?, I . BritishWmi ImUm Please reply to: 42 FUzwOIiam Square, Dublin 2. Tel: 765144/763065 Ftoc 612035 (IOf)94»4ftS3/4 Trine CF4M3 Fuc (109)949-7946 0O9)9«M287 M . D a v id H u m p h rie s, B s q ., S e n io r M anager - O p e ra tio n s G uinn ess ft Mahon L im ite d , 17 C o lle g e G re e n , DUBLIN 2. D e a r D a v id , C o u ld you p le a s e a rra n g e f o r me t o c o lle c t T r a v e lle r s Cheques to th e v a lu e o f S tg .£ 1 ,0 0 0 (1 0 x S tg .H I 0 0 ) on F r id a y n o r a in g . They a r e f o r P .J . C lo n an and he w i l l be c a llin g in n e x t week when I s h a ll g e t him t o s ig n and r e tu r n th e r e le v a n t d o c u m e n ta tio n t o you im m e d ia te ly t h e r e a f t e r . The d e b it s h o u ld be t o A nsbacher L im ite d A ccount N o .1 3 1 5 4 6 0 2 . If th e r e i s any p ro b le m , p le a s e le y me know . Y o u rs s in c e r e ly i j UU. A Utntbtr qfilm Htnry Anrimehtr HoidinfJ PLC Mtrchun Jankfrig Group P.O. Box M7, OiMd Cayman, BritishW « V*j-« Please reply to: Phene not)h m u h JJFIn^Squar,. 2. Tel: 765144/763065 F a r 612035 D u b lin .t a S B S K (SOT) 949-32A7 Sth February, 1991. Garre t t Logan, Esq., Ir is h Intercontinental Bank Limited, 91 M a r r i o n Square, DUBL I N 2. Dea r Garrett, Could yo u plaaaa arranga to let m e have for collection a Sterling Draft for Stg. £6,500 p a y able to Mrs. 0 . Leydon and d e b i t A n s b a c h e r Limited Account N o .02 /01 087/81 w i t h the coat. Yours sincerely, /*• 'J U b -* ' ' '■ •7 rar A N S B A C H E R LIMITED . D PC /AJW A v° / V L\ “F A I R M O N T ” J A C K S T A K E L U M BALLYRONAN ROAD C H A R TER ED ACCO UN TAN T J KILPEDDER T E L E P H O N E : 2 81 0 6 4 6 F A X : 281 0645' M O B I L E : 087 2854660 S CO. W I C K L O W The Inspectors Trident House Blackrock C O . D U BLIN 6 W AGfo November, 2000 Dear Sirs, With reference to your letter of the 18th October, and in particular the third paragraph, I should point out that I did not refuse as such to provide the information in question, merely that I should be afforded the opportunity to argue w h y I should not be asked to divulge such information. The persons in question dealt with m e on an understanding of confidentiality, and as the Inspectors will surely appreciate, it is difficult not to honour that confidentiality, particularly w h e n one has been used, over one’ s professional life, to honouring the confidentiality of Clients. However, as you point out forcefully in your letter, you are not prepared to allow m e that opportunity and you have referred to the legal position. In the circumstances, I attach a list of the names and addresses of the persons in question. Yours faithfully, Enel: V.A.T. N um ber 2 8 5 4 4 8 5 K P. J. Clonan, c/o James Gillett & Company, Chartered Accountants, 42 Adelaide Road, Dublin 2. Denis Jackson, 21 Grange Road, Foxrock, Dublin 18. Michael Leyden, c/o The Bungalow, H o l m e Lane, Messingham, Near Scunthorpe, South Humberside. England, (deceased) A iitmh r of 0m Hmwy Ambadmr HaMnft PLC Mtrthm t tanking Group Please reply to: 42 Fitzwflliam Square, Dublin 2. Tel: 765144/763063 Fix: 612035 P.O. tat 117,O m d Ckjmaa. M U W « India* noec (W)MMiS)/4 Tahoe CP 4309 Fix: p^ *j bViLbC h; p ^ Irjuc-lwv Loan w ill alao lio iwod to pay existiiiK borrowintfsftnd, an .receipt of the proceed* of sale of Ballynoe, » f ll be d oalt with a s statod in paragraph 6 ( a ) of the f a c ility le c to r as fu rth er explained above. Y ours f a i t h f u l l y CUINNKSS (t MAIJOM LTD. -u . •J-1 Appendix our Bat} PO’ D/AC SSrd M ptM bar 1977, Daar Sir* , ' With.roforane* to aorranpondaao* aadar saparat* eovor, I wish to adwls* th a t tha t a l u s * on ycmr *tgeGieanDufaftt2Ra0m53A'Maphonai7Ba4U' PKBSCNAL S la t January, 1878. 8. Stephenson, Esq. 31 Lsesoa Close*. public a. Dear Sm , Many thanks fo r yours o f th a 4 th January and r e g ra ta th a t due to a hoary tr a v e l load in January X have n o t r e p lie d b efo re no*. As yon know from previous- discussion* I do n o t p e ra o n a lly d e a l w ith your Account* and Z hava aooordingly handed your l a t t e r to P at (Vggycz - fce^process. Z would, however, make two p o in ts to you : ( ^ v 1. tfrowaan Tunda lh*>^ayaaj^4unda ara hypothecated a g a in s t your p e rso n a l Accqunvand as such I t w ill ha n aesssary to b rin g thoae funds back to tha c r e d i t o f your Aooount. - Zf you arrange to l a t me hava an in s tru c tio n Addressed to Guinness Ifahon Cayman Truat U n ite d Z s h a l l arran g e w ith them to have th e funds tra n s fe rre d value date Monday, 9 th January. 2* Marlborough . As ex p lain ed to C h ris, Z do n ot know how much w ill be a v a ila b le i n connection w ith Marlborough nor th e tim ing as to th e a v a il a b il it y and th is w ill depend com pletely on how long i t ta k e s th e Bavenue to s o r t m a tte rs o u t. Vben P at has processed m atters he w ill c o n ta c t you. Ybura s in c e re ly . J .P . Traynor. Mr. J 0 Tfiymr, D aputy Chairman, MaatraGttlimattftMahont 17CoflagaGraa3id April, 13th April) Thaaa t mmat a continuation of our lattlamant agraamant of tha 30th Saptamfaor 1978 and I am glad to m your lattar of tha 18th confirm thto. . Tha Saptambar 976 agraamant wfth tha bank doaftwfth rtva dJf* ■rant loan account! Thraa of thaaa hava boan riaarad off and only two ramaln, namaJy AOadbury 8*curttfa* and Saaphanaon G&nty ft AaodaWa, both of tahbh It b Imandad to daar aa qulekly « poaribb, You already hokJ adaquats aacurfty by way of gtiarantaaaandtModocumant*. . I am abo ptapand to gfea you authority to uaa my than of tha ftmda and faaa dua from tha «b of tha Marlborough Propartlat at Wlnton Road, and Bwaaford Immtmanta to- bo tuad to daar thaaa accounfit I do net mo any waaon why wa ihould dapait from tha aatdamant agraamant of 90th Saptambar B78 and from your lattar of th* 18thJuna I fcal that thb Ii yourIntamlon. It la your SoRdton who an auggaiting lagal prooaadlnss, which I ftar would not ba In any of our fcittnata and I would urgayou to ratrafn tham. Lot us eontlnua our agraamont of 30th Sapt­ ambar 1876 and It ihould toon ba oompbtad. Your tlncaraly* Stephanaart Associates Yoar refi JOD/DQ October 10 1978 f MeeanArtharCoxS Compaay SoIJcfton • 42/45 St.Stephen Cnam Dublia2 Rat . XT ' f 1 ' • ^ " Cufaneae A Mahon Limited Dear S in , I lu m your letter o f tha 28th SaptaaAer 1978. It would appear fromyour letter of th* 29th Attgmt that your clients haw told yoo or a o n a o l tha facts. Art you aware that a settlem ent agreement covering in « to ta l paekace m y panouat, corfnnK e, property and h u t aecounta waa aondndad fa A utum a 1974 and lu m yon capias o f thaaa docum ents? Y o tr cHenia an weU aware Im (tie remafciing fcwaa a n a bufgaifleant proportion o f the overall situation w hich (lien tjdilad,am i would conveniently Oka to treat the presentloaaa in isolation . Furtherm ore, your cUaats m flatan B yam ead ed tin orfafatai a m e n ea t fay seeking additional aacnrily orer m y Horn*. I am. p ip a a d to abide by tua original agreem ent b ut n o m n i m y acceptance o f youretienl* facility laltsra of earlier this year if bated ' on thfe proposition. Mrs -Bernadette Staphenson n fin o a to sign anything which ' Involvea yourcBanta. 1 aota that you intend to Issue proeaadtafi and fat m y d efence 1 w fll b e oMfaed to t m a l Ilia fa ll terms o f tha aattMment agreement and thle w ill nO aet bo credit on ■ your clien ts. 1 w ould be reluctant to d o th o . ' •' * ' . I would refer you to my letter of 24th July 1978, whoa I relumed tiie agreements and guarautaos signed if me. If your clients are prepared to. accept these documents t am prepared to deposit £10,000 to reduce the Stephenson Gioner k Associates account and resume interest payments on tha kuna from 1st Decraber 1978. Youra «incorely. MICHAEL PEART CHARTERED ACCOUNTANT REGISTERED AUDITOR REGISTERED TRAINER GREEN ACRES LOUGHANURE CLANE CO. KILDARE TELEPHONE: 045-868168 FACSIMILE: 045-861369 FOR THE ATTENTION OF FRANCES GAYNOR Office of the Inspectors Appointed by the High Court to Ansbacher (Cayman) Ltd 3rd Floor Trident House Blackrock Co. Dublin _ ...... ...:-/'i 3 January 2002 RE: Y O U R REFERENCE NO. C/S01/NSPM Dear Sir I am acting for Mr Sam Stephenson to whom you wrote on 3 December 2001, to inform him of your preliminary conclusion that “(he) was a client of Ansbacher”. While I understand the thought processes which have caused you to come to this conclusion within the terms of your own terminology, I must inform you of two very important matters which entirely alter the impression your conclusion would convey if you include it as a statement in your report to the High Court. Firstly, the monies belonging to Mr Sam Stephenson which were deposited with Guinness Mahon Cayman, were transferred before the enactment of sections 57 to 61 of the Finance Act 1974. Whether or not it was the intention behind the transfer, devised by persons known to Des Traynor and implemented by him on behalf of Mr Sam Stephenson, to avoid Irish income tax on the interest according to the monies on deposit with Guinness Mahon Cayman, it was not illegal to do so prior to the 1974 legislation. With the enactment of that legislation it became illegal unless “the transfer and any associated operations were bona fide commercial transactions and were not designed for the purpose of avoiding liability to taxation” (FA 1974 s57(3)(b). In this case, “the transfer and any associated operations” means the retention for the time being of these monies belonging to Mr Sam Stephenson in Guinness Mahon Cayman and this retention was most certainly “a bona fide commercial transaction not designed for the purpose of avoiding liability to taxation” because: (a) Des Traynor needed, for banking commercial reasons, to retain this off-shore deposit system for the absolute control which it afforded to him over the security for the Guinness Mahon Ireland loans made to Mr Sam Stephenson to finance their joint property transactions (please note your piece of evidence, an internal memo from Des Traynor dated 18 May 1976 which ends “no entries other than bank interest/charges or credits can be made now without my specific instructions”); and (b) there was no liability to taxation to be avoided as the property transactions and interest charges had resulted in such large losses that all Mr Sam Stephenson’s personal assets were being called in (please s e e the same internal memo from Des Traynor dated 18 May 1976). Secondly, your use of the term “Ansbacher” in the case of Mr Sam Stephenson is unfortunate, misleading and potentially libellous because by your own admission, the term “Ansbacher” has become pejorative and Mr Sam Stephenson only ever had deposits with Guinness Mahon Cayman (as Mr Sam Stephenson remembers it and understood it at the time) or Guinness Mahon Cayman Trust Limited (as it may actually have been to satisfy the scheme implemented by Des Traynor). Bearing in mind that in 1971, when according to your document, Guinness Mahon Cayman was set up, it was not illegal to benefit from it even if it were the intention to avoid Irish tax and also bearing in mind that in this cas e it continued not to be illegal after the 1974 legislation, then referring to Guinness Mahon Cayman as “Ansbacher” is entirely misleading with consequences to Mr Sam Stephenson’s interests, good name / or reputation. At no time did Mr Stephenson have an account with a bank which had “Ansbacher" in its name. To conclude, it would be grossly unfair to include Mr Sam Stephenson’s name in your report to the High Court and I must object to your doing so. Please note that if your actions result in damage to Mr Sam Stephenson’s interests, good name and/or reputation, then he reserves the right to take such action as he may be advised. MICHAEL PEART A p p e n d ix X V (123) S u p e r Ser L im ited 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Super Ser Limited. a) Transcript o f evidence o f Mr James Henry (John Harold) Lindsay dated 24 March 2000. b) Guinness and Mahon credit committee memo re Super Ser Limited. Correspondence received from or on behalf of Super Ser Limited. a) Letter o f 3 December 2001 - Gore & Grimes Solicitors to Inspectors. UNDER OATH ON FRIDAY, 24TH MARCH 2000 I hereby c e r t i f y the f o l l o w i n g to be a tru e and accurate t r a n s c r i p t of my shorthand no tes in the above named in t e r v i e w . Stenographer The I n s p e c t o r s : MR. JUSTICE COSTELLO MS. MACKEY BL S o l i c i t o r t o the I n sp e c t o r s MS. M. CUMMINS Interviewee: MR. JOHN HAROLD LINDSAY Represented by: MR. KARL HAYES GORE & GRIMES WITNESS MR. J. LINDSAY I EXAMINATION MR. JUSTICE COSTELLO PAGE 1 2 3 4 MR. JUSTICE COSTELLO: Mr. Lindsay, we w i l l s t a r t our i n t e r v i e w . 5 6 MR. LINDSAY: Yes. 7 MR. JUSTICE COSTELLO: My name i s Declan C o s t e l l o and Ms. Mackey i s on my 8 9 right. We are the I n s p e c t o r s , two o f the 10 I n s p e c t o r s , appointed by The High Court, as you 11 know. 12 MR. LINDSAY: Yes. 13 MR. JUSTICE COSTELLO: I should e x p l a i n to you 14 th a t t h i s i s not a Court. 15 I t i s not a t r i b u n a l . 16 MR. LINDSAY: Right. 17 MR. JUSTICE COSTELLO: I t i s an i n v e s t i g a t i o n . 18 MR. LINDSAY: Sure. 19 MR. JUSTICE COSTELLO: I f in the course of the q u e s ti o n s th a t we ask, you 20 21 wish t o c o n s u lt with your s o l i c i t o r p l e a s e t e l l me 22 t h a t you wish to c o n s u lt and we w i l l stop the 23 q u e s t i o n in g whi le to do so. 24 MR. LINDSAY: Yes. 25 MR. JUSTICE COSTELLO: I f your s o l i c i t o r wishes 26 to c o n s u lt with you he can 27 i n d i c a t e t h i s t o me and we w i l l stop q u e s t i o n in g for 28 t h a t purpose. 29 1 2 i n v e s t i g a t i o n your 3 evi dence w i l l be taken under oath and I w i l l ask our 4 s o l i c i t o r now, Ms. Cummins, to admi nis ter the oath 5 to you. 6 MR. LINDSAY: Yes. 7 MR. JUSTICE COSTELLO: No, i t i s a l l r i g h t . 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Do I stand up? 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 one p r el im in ar y matter 6 t h a t I want to r a i s e with you? 7 A. 8 2 Q. 9 Yes. In our l e t t e r to you we asked you fo r a d e t a i l e d statement about your r e l a t i o n s h i p with "Ansbacher" 10 11 Mr. Lindsay, t h er e i s and we have not r e c e i v e d any statement? A. 12 Just a moment ago Mr. Hayes here mentioned t h a t to me . 13 3 Q. 14 A. Yes? There was a chap in D e l o i t t e Touche c a l l e d 15 Eamonn Coates and I understood from him t h a t he had 16 made the arrangement th at I come here and, in f a c t , 17 t h a t was i t . 18 4 Q. I looked through t h a t . However, Mr. Lindsay i t could not be c l e a r e r . We 19 asked in our l e t t e r t o you fo r a f u l l and d e t a i l e d 20 statement o f a l l the d e a l i n g s th a t the company had 21 with you e i t h e r d i r e c t l y or i n d i r e c t l y . 22 the problem about g i v i n g us a statement? 23 A. A b s o l u t e l y no problem. What was I mean i t i s a s t u p i d t h in g 24 to say but I d i d n ' t even se e th a t because what I 25 immediately did was I got in touch 26 with Eamonn Coates. 27 5 Q. 28 A. 29 6 Q. What i s h i s name? Eamonn Coates. Coates? 1 2 7 Q. 3 A. 4 8 Q. 5 A. Yes? They were our accou nta nts. Yes? And I understood th a t he had co n t ac t ed t h i s o f f i c e 6 here. 7 on the 2 4 t h " . 8 9 Q. 9 Yes. He s a i d , "What you have to do now i s turn up Did he not ad vi s e you th a t you should make a statement ? 10 A. 11 10 Q. 12 A. No, he did not. Did you not se e t h i s in the l e t t e r ? No, I d i d n ' t . I must admit th a t when I saw so much 13 of t h i s l e t t e r I thought, 14 fo r my accountant". 15 11 Q. 16 A. 17 12 Q. 18 A. 19 13 Q. 20 21 Yes. "Well, t h i s i s something Perhaps, you can o u t l i n e now t o us? Yes, c e r t a i n l y . What y o u r . . . (INTERJECTION)? In other words my u n d e r s t a n d i n g . . . (INTERJECTION). No, sorry, j u s t wait now. Just b efo re we go on. We a l s o asked fo r a l l the documents t h a t you had? A. 22 I don 't have any documents. I ha ve n 't had fo r maybe t en years or so. 23 14 Q. 24 A. 25 15 Q. 26 A. From be fo re t h a t . 27 16 Q. From be fo re that? 28 A. 29 17 Q. Who were your accountants? D e l o i t t e Touche. From 1979? Yes. Have you asked them have they any records or 1 2 No, but I presume they have the reco rd s, a l l our tax 3 records. 4 18 Q 5 A 7 19 Q 8 A 9 With which company now? With "Ansbacher"? I d o n 't th in k we had any r e l a t i o n s h i p with "Ansbacher". 10 20 Q 11 A 12 21 Q 13 A 14 Do you not? I d o n 't th in k so. W e l l . . . (INTERJECTION)? Because at the time when our company.. . (INTERJECTION). 22 Q 16 17 However, a l s o a l l your r e l a t i o n s h i p s with the company, would they not have? 6 15 Yes. No, I am t a l k i n g about your company. I am t a l k i n g about you p e r s o n a ll y ? A No, I know p e r s o n a l l y . When i t went b e l l y up - ­ 18 t h a t I th in k was about the time t h a t 19 Guinness & Mahon became in v o lv e d with "Ansbacher". 20 23 Q Are you say ing th a t you had no r e l a t i o n s h i p at a l l 21 with the company, with Guinness Mahon Cayman Trust 22 Company, which subs equ en tly changed i t s name 23 t o "Ansbacher"? 24 A 25 24 Q 26 A 27 25 Q Yes, c e r t a i n l y with Guinness & Mahon, y es . No? Very much so. No, I am asking: Did you have any r e l a t i o n s h i p with 28 the company i t s e l f , with Guinness Mahon Cayman Trust 29 Limited? 1 2 26 Q. 3 A. 4 27 Q. 5 A. 6 28 Q. 7 You did? Y es . Person ally ? No. Well, the company. No, no. Leave the company. I am not asking you about the company, Mr. Lindsay? 8 A. 9 29 Q. 10 Yes. I am asking you p e r s o n a l l y . Did you not have a p ers on al r e l a t i o n s h i p ? 11 A. 12 30 Q. 13 A. 14 31 Q. 15 Yes, yes. You did? Yes, subsequent - - w e l l , we w i l l come t o t h a t . How are we to carry out t h i s i n v e s t i g a t i o n i f you have not give n us the documents? 16 A. 17 32 Q. 18 A. 19 33 Q. But I hav en 't got any documents. Your accountants have? I presume they have. Very w e l l then. T e l l us about your own personal 20 r e l a t i o n s h i p with Guinness Mahon Cayman Trust 21 Limited? 22 A. 23 Right, Cayman - - you see th a t i s subsequent to the Super Ser b u s i n e s s . 24 34 Q. 25 A. Yes? Because when the Super Ser b u s i n e s s went f l a t I got 26 a job in Bangladesh and during th a t time I had 27 problems at home. 28 and she had a Court Order at one time t h a t I 29 c o u l d n ' t i s s u e any cheques. My w if e was loo k in g fo r a div orc e 1 35 Q. 2 A. What year are we t a l k i n g about? 1986 or 1987 I would th ink , somewhere about t h e r e . 3 I had th ree kids in c o l l e g e in America and they had 4 to be paid. 5 36 Q. 6 A. 7 37 Q. 8 A. Ann. 9 38 Q. Ann? 10 A. 11 39 Q. 12 A. Ann Lindsay. Alan? Ann, yes. Yes? And she was in a u n i v e r s i t y c a l l e d Highland U n i v e r s i t y near Alberqueque near Mexico. 13 14 40 Q. 15 A. Yes? Now, she wouldn't go over t h er e u n l e s s her b o yf rie nd went with her. 16 17 What are t h e i r names? 41 Q. We need not go i n t o t h e s e d e t a i l s . What were the ot her sons? 18 19 A. 20 42 Q. 21 A. 22 43 Q. 23 A. 24 44 Q. 25 A. W e l l . . . (INTERJECTION) . Had you sons? Yes. What were t h e i r names? Yes, Ralph Lindsay. Yes? And he was in Washington S t a t e U n i v e r s i t y doing forestry. 26 27 45 Q. 28 A. 29 46 Q. Had you another son? Yes, Alan. Alan? 1 2 47 Q 3 4 Yes. You were say ing then th a t something happened in 1986? A Yes. I rang up Mr. Traynor and s a id , "I have got a 5 problem here and any money th a t I have se nt to a 6 bank or to Dublin I c a n ' t w r it e a cheque on i t . " 7 So, he s a id , 8 I w i l l s o r t th a t ou t," which he did . 9 Cayman and th a t i s how I became in v o lv e d with - ­ "You j u s t get the money se nt t o me and I t was in 10 p e r s o n a l l y now, th a t i s how I became in v o lv e d with 11 Guinness & Mahon Cayman. 12 48 Q 13 A Yes. T e l l us what the arrangement was? The arrangement was th at the money would be sen t to 14 him and then whenever I wanted money se nt t o pay 15 sc ho ol f e e s or anything l i k e th a t he would forward 16 the money. 17 49 Q 18 A 20 50 Q 21 A 22 51 Q Yes . Did he t e l l you what he was going t o do with i t ? No. He was going to pay any b i l l s t h a t I wanted Did he t e l l you i t was going i n t o the Cayman, the Guinness Mahon Cayman Trust Company? A I don 't remember him us ing th a t term a c t u a l l y b u t . . . (INTERJECTION). 26 27 52 Q 28 A 29 You forwarded money t o him? paid out o f i t . 24 25 Did he t e l l you what he was going t o do with the money? 19 23 Yes. What did you understand, Mr. Lindsay? Well, in t h os e days - - I mean I c e r t a i n l y hadn't the same understanding of Cayman. 1 53 Q. Mr. Lindsay, what did you understand t h a t he was 2 going t o do with the money? 3 it? 4 A. 5 54 Q. 6 A. 7 8 Where was he going to d e p o s i t i t ? I h o n e s t l y don 't know. I presume i t was Cayman. Yes? Because i t was out of the j u r i s d i c t i o n of the Court Order th a t was a g a in s t me. 55 Q. 9 10 Where was he p u t t i n g Yes. T e l l me e ve r y th in g now th a t you can about t h i s arrangement ? A. Well, th a t worked okay. A l l the f e e s were paid and 11 a l l the r e s t o f i t . 12 years in c o l l e g e and when i t was more or l e s s over 13 t her e was a remainder and I s a i d - - 14 Spain who was g e t t i n g married and I got the 15 remainder sent to him to buy h i s house. 16 5 6 Q. 17 A. 18 57 Q. 19 I had a son in Y es . That was the end o f th a t a s s o c i a t i o n . Yes. Did you e n t e r i n t o any Trust Deed in r e l a t i o n to t h i s arrangement? 20 A. 21 58 Q. 22 A. 23 59 Q. 24 A. 25 26 Each o f the t h re e were four No, none at a l l . You j u s t . . . (INTERJECTION)? I t was j u s t done . . . (INTERJECTION) . You j u s t handed on money to Mr. Traynor? Yes, and th a t was the way I had d e a l t with him from the very begin nin g. 60 Q. 27 Yes. Did you pay any tax on the i n t e r e s t t h a t the money earned? 28 A. 29 61 Q. No. I don 't even know i f i t did earn i n t e r e s t . Mr. Lindsay, I want to put some documents now to you 1 t h a t have come i n t o our p o s s e s s i o n as a r e s u l t of 2 the i n v e s t i g a t i o n . 3 "Resident & Non-Resident Loans". 4 i s 1973. 5 (Same handed)? 6 A. 7 62 Q. 8 This i s the f i r s t le dg e r I t i s one th at I f you would hand th a t up t o him Thank you. No, no. I t i s not t h a t . MS CUMMINS: It is , 9 Judge, I have taken the names out of i t j u s t . 10 MR. JUSTICE COSTELLO: Yes, 11 a ll right. up (Same Handed). 12 A. 13 63 Q. Thank you. Sorry, would you j u s t g i v e me th a t back p l e a s e . 14 does not matter about the names Ms. Cummins. 15 me t h a t l e t t e r ? 16 Just hand i t up (Exhibit 1) 17 A. 18 64 Q. 19 It Show I t does not matter about the names. (Same handed)? Y es . This i s a record from Guinness & Mahon here in Ireland? 20 A. 21 65 Q. 22 A. 23 66 Q. Yes. I t i s a record o f "Resident & Non-Resident Loans"? Yes. I t r e f e r s to you Mr. Lindsay, "J. H. Lindsay," and 24 i t i s a loan o f £17, 000. 25 loan of £ 1 7 , 4 4 5 . 8 0 . 26 date i s 1973 and then the comment " s u i t a b l y 27 secured," i s w r i t t e n a f t e r i t . 28 1973 t o you p e r s o n a ll y ? 29 Hand i t There i s a balance on the You w i l l see t h a t the repayment This i s a loan in 1 67 Q 2 A 3 68 Q 4 A 5 69 Q Maybe. I don 't know. You do not remember? No, I d o n 't . You see the information which we have obtained 6 Mr. Lindsay i s th a t the phrase " s u i t a b l y secured", 7 means th at i t was a cash back loan and t h a t i t was 8 on a d e p o s i t in the name o f Guinness Mahon Cayman 9 Trust Limited? 10 A 11 70 Q Yes . That i s what the " s u i t a b l y secured" means. If this 12 i s so t h i s would appear th a t you had a loan from 13 Guinness & Mahon as far back as 1973 t h a t was 14 secured on - - th a t was cash backed? 15 A The only s e c u r i t y th a t Guinness & Mahon ever got 16 from us was - - I know I have to answer you d i r e c t l y 17 but may I go j u s t a l i t t l e b i t beyond that? 18 71 Q 19 A 20 Yes ? When we f i r s t o f a l l got the a g en ci es fo r t h e s e u n i t s , t h e s e h e a t e r s , p o r t a b le gas h e a t e r s . 21 72 Q 22 A Yes? We brought some o f them home and th ey - - o b v io u s ly 23 t h er e was an i n t e r e s t in them and over a year they 24 started to, 25 could get in a b ig number o f t h e s e we could 26 d e f i n i t e l y s e l l them. 27 Yes? 28 So, I went to the Bank Of Ir ela n d , which was my bank 29 and my f a t h e r ' s bank and my g ra n d f a t h e r 's bank, but you know, s e l l . We then f e l t t h a t i f we 1 any way they wouldn't g i v e us the money. 2 matter of f a c t i t might have been - - I d on 't know i f 3 t h a t would f i t in with th a t or not but i t might have 4 been about £1 7,0 00. 5 Yes ? 6 A As a I t was a b ig sum then. And we were with Haughey Boland then. They were our 7 accountants and they sent us to Guinness & Mahon and 8 t h er e I met Mr. Traynor. 9 d e f i n i t e l y s e l l these?" He s a i d , I said, "Can you "Yes, a b s o l u t e l y , 10 d efin itely." 11 I s a id , 12 would take a percentage o f th em ." 13 me a s u b s t a n t i a l order from Calor Kosangas and I 14 w i l l gi v e you the money". 15 75 Q 16 A He s a id , "What proof can you gi v e me?" "Well, Calor Kosangas have s a i d t h a t they He s a id , "You get Yes? So, I went to Calor Kosangas and th ey agreed to take 17 them and I gave him the t h in g and he gave us the 18 money. 19 76 Q 20 A 21 77 Q This i s you? You say "us" Mr. Lindsay? Yes, the firm. No. However, t h i s i s not a loan t o your firm. 22 w i l l come to the loans to the firm in a minute. 23 am t a l k i n g - - t h i s i s a p er so na l loan t o you? 24 A 25 78 Q 26 A 27 79 Q 28 A 29 80 Q I Well, maybe at th a t s t ag e i t was a p er so na l loan. Yes ? I d o n 't even know i f we were a firm then. You see the phrase " s u i t a b l y secured"? Yes, I do. I 1 2 81 Q. 3 Did Mr. Traynor then make the arrangement t h a t you were to t r a n s f e r money to the Cayman I sla n ds? 4 A. 5 82 Q. 6 A. 7 83 Q. No, he never mentioned t h a t . You say th a t was in 1986? That was - - yes, th a t was much l a t e r . I see. You se e I have to s u gg es t t o you t h a t t h i s 8 loan was continued on Mr. Lindsay and t h a t the 9 documents show th a t you were s t i l l indebted 10 to Guinness & Mahon in 1975. 11 Perhaps, I gave you the wrong da te. 12 th a t was the repayment da te. 13 other document "J. H. Lindsay" (Same Handed)? 14 A. 15 84 Q. That i s the f i r s t one. I t was 1973, Would you look at the Thank you. Again, " s u i t a b l e secured". I must s u g g es t to you 16 Mr. Lindsay th a t th a t loan, probably i t was the same 17 loan, was secured by a Cayman d ep os it? 18 A. No, i t w a sn 't. The only s e c u r i t y , as I say, t h a t we 19 ever gave Guinness & Mahon, and i t happened again 20 l a t e r , was in the form th a t he would advance money 21 a g a i n s t orders. 22 85 Q. Mr. Lindsay, may I r e f e r you to another document. 23 Ms. Cummins, i t i s the le d g e r account fo r 1987. 24 shows a d r a f t i s s u e to Mr. Lindsay (Exhibit 2 ) (Same 25 Handed)? 26 A. 27 86 Q. 28 A. 29 87 Q. Thank you. Do you see that? Yes. 1987? When was t h i s , 1 9 . . . ( INTERJECTION)? It 1 2 88 Q. I w i l l j u s t show you what t h i s document i s . It is a 3 le d g e r account in Dublin o f Guinness & Mahon. 4 the account of Guinness Mahon Cayman Trust Limited. 5 Do you see th a t on the l e f t - h a n d s i d e , the top on 6 the l e f t - h a n d s ide ? 7 A. 8 89 Q. 9 A. 10 90 Q. It is Yes. Do you see that? Y es . You see i t i s a s t e r l i n g account. That Guinness 11 Mahon Cayman Trust Limited had in Guinness & Mahon 12 Limited? 13 A. 14 91 Q. Yes. Do you see about a t h i r d o f the way down on the l e f t - h a n d s i d e in February 1987; 15 16 "draft i s s u e d to J. H. Lindsay"? 17 18 A. 19 92 Q. 20 A. 21 93 Q. 22 A. 23 94 Q. 24 £13,411? I d o n 't th in k the f i g u r e i s t h e r e , but i s i t ? Perhaps, i t i s the wrong fi g u re ? Yes. Sorry. I t i s £1 ,0 0 0. it. 25 A. 26 95 Q. 27 A. 28 96 Q. 29 Y es . £1 ,0 00 . I t i s £1,066? £1 ,0 66 . Yes? I am sorry I am misreading 1 97 Q 2 Is t h a t not a d r a f t i s s u e d to you fo r £ 1 , 0 6 6 . 2 6 from the Guinness Mahon Cayman Trust Limited account? 3 A 4 98 Q I don 't know what i t i s . Just look at i t now. I could make s u g g e s t i o n s . Does i t not appear t h a t the 5 Guinness Mahon Cayman Trust Limited account i s 6 d e b it e d with t h i s f i g u r e , t h i s d r a f t , which i s 7 payable to you? 8 A 9 10 Cayman. 99 Q 11 12 A I have no id ea . I mean i t could have been for t i c k e t s , a i r t i c k e t s , or I don 't know. 100 Q 15 Out of the Guinness Mahon Cayman Trust Limited account? 16 A 17 101 Q 18 Out of our account in the Cayman. No, t h i s i s your pers on al payment, a payment to you, out of the Guinness Mahon Cayman Trust Limited? 19 A 20 102 Q 21 A 22 103 Q 23 I have no idea why they put th a t t h e r e . Yes? I have no idea at a l l . All right. I want you to look at page 29. It is a report about H. Lindsay (Exhibit 3 ) (Same Handed)? 24 A 25 104 Q 26 Thank you. I want to e x p l a i n to you what t h i s document i s Mr. Lindsay? 27 A 28 105 Q 29 I am j u s t asking you about t h i s payment t o you, out to you p e r s o n a ll y ? 13 14 Yes, but by t h i s s t ag e the company had an account in Yes . This i s a report from Guinness & Mahon. A pr il 1978? I t i s 1978, 1 2 106 Q 3 Guinness & Mahon. 4 t o the bank? 5 A 6 107 Q 7 I t i s d e s c r i b i n g i t s major loans Yes . To The Central Bank. I t has t h er e, "H. Lindsay - £156,537". 8 9 That i s you. 10 You are d e s cr ib ed as: "Mr. Lindsay i s a major shareholder in Super Ser Limited."? 11 12 A 13 108 Q 14 A 15 109 Q 16 Yes . Is t h a t you? Yes, I was a 50% share ho lder . Yes. I t says the purpose o f the loan was "personal loan/working c a p i t a l " . 17 18 Do you remember th a t loan? 19 A 20 110 Q 21 A 22 No, I do no t. Do you see i t says th at s e c u r i t i e s are held? Securities, "Guarantees are held up to £ 1 7 5 , 0 0 0 . . . " 23 24 111 Q 25 A Yes . 26 112 Q Yes. 27 28 29 Guarantees ? Then i t goes on: "Comment: Guinness & Mahon are happy t o continue t h i s f a c i l i t y to Mr. Lindsay. No f a c i l i t y l e t t e r was a v a i l a b l e in r e s p e c t o f t h i s loan which was arranged p e r s o n a l l y by Mr. Traynor." 1 2 3 I mean I never got £156,000 or £175,000 from 4 Guinness & Mahon p e r s o n a l l y . 5 t h a t they are conf usi ng the company and me. 6 113 Q. 7 I can only sugg est Would you turn over the page to the next page (Same Handed)? 8 A. 9 114 Q. 10 Yes . This i s a c o n t i n u a t i o n and i t t a l k s about: "Super Ser/H. Lindsay - £1,336,023" 11 12 and, 13 "Super Ser Limited - £ 1 ,1 79 ,4 86 " . 14 15 These are loans t o , i t sa ys, 16 "Super Ser/H. Lindsay"? 17 18 A. 19 115 Q. 20 A. 21 116 Q. 22 A. 23 24 Yes, a l l r i g h t . I don't se e i t . Do you remember.. . (INTERJECTION). Yes, yes, I se e i t . Do you remember a s u b s t a n t i a l loan of £ 1. 3 m i l l i o n ? No, I don 't but I can imagine circumstances in which i t could have happened. 117 Q. 25 Yes. The document says: "Super Ser/H. Lindsay"? 26 27 A. 28 118 Q. 29 A. Yes . Was i t to you p e r s o n a l l y or to the company? Well, I never got anything l i k e t h a t . 1 119 Q 2 A 3 120 Q 4 No. You were mentioning th at the company had d e p o s i t s . Do you see, 5 "Security: Super Ser Limited has d e p o s i t s o f around £400,000 with Guinness Mahon Cayman Trust Limited"? 6 7 8 A 9 121 Q Yes . That i s what you are r e f e r r i n g to? That seems to 10 have - - the company seems to have had d e p o s i t s in 11 the Cayman I s l a n d s in Guinness Mahon Cayman Trust 12 Limited? 13 A 14 122 Q 15 A 16 123 Q 17 Yes . Do you see t h i s was in 1978? 1978, maybe. I should e x p l a i n to you th a t I am not i n v e s t i g a t i n g . . . (INTERJECTION)? 18 A 19 124 Q 20 A 21 125 Q 22 A 23 126 Q 24 No. We are not i n v e s t i g a t i n g the company today? Yes . I am i n v e s t i g a t i n g your p er so na l a f f a i r s ? Yes, a l l r i g h t . However, you r e f e r r e d to the f a c t t h a t the company had d e p o s i t s ? 25 A 26 127 Q 27 A 28 128 Q 29 A Yes . I am j u s t drawing your a t t e n t i o n t o t h i s f a c t ? Yes. May I e x p l a i n some o f the in t e r t w i n i n g ? Yes, do? Well, we s t a r t e d o f f s e l l i n g h e a t e r s here and we had 21 1 2 129 Q. 3 A. Super Ser Limited. 4 130 Q. Super Ser Limited? 5 A. 6 131 Q. 7 A. 8 132 Q. 9 A. 10 133 Q. 11 A. 12 134 Q. 13 A. 14 135 Q. 15 A. 16 Y es . I t was in cor por ate d in Ireland? Yes. And when you say "we" who was "we"? A man c a l l e d Goosen. Yes? And m y s el f. Yes? We were 50/50 in i t . Yes? Then t h in g s began to dry up a b i t here and we went t o England. 17 136 Q. 18 A. 19 Yes? Mr. Goosen went to England and he s t a r t e d the same t h in g th ere and I was a l s o 50/50 in t h a t . 20 137 Q. 21 A. 22 Yes? Now, th at s o ld an awful l o t more s t u f f than we s o ld i n Ir ela n d . 23 138 Q. 24 A. 25 139 Q. 26 A. 27 140 Q. 28 A. 29 What was the name o f i t ? What was the name o f th a t company? I th in k i t was Super Ser UK Limited. Yes? Or something. Yes? Yes, and then su bsequently we decided t h a t our s a l e s were slowing down, and as the people who su p p li ed us 1 with t h e s e h e a t e r s were g e t t i n g more and more 2 ex p en s iv e, and as more and more co m p et iti on was 3 coming on the market i t was, you know, r e a l l y very 4 d i f f i c u l t for us to deal with Super Ser Spain 5 anymore. 6 we b u i l t . 7 141 Q 8 A 9 142 Q 10 A 11 So, we decided to b u i l d a f a c t o r y , which Where? In T al l a g h t. Yes ? And we co m p let el y equipped th a t and we s t a r t e d to make our own h e a t e r s . 12 143 Q 13 A 14 144 Q 15 A Was t h a t Mr. Goosen and y o u r s e l f ? Yes . Was t h a t in Super Ser Limited or another company? No, I am not q u i t e sure what we c a l l e d o u r s e l v e s 16 then but the product th a t we made was Ardant, 17 A -r-d-a-n-t. 18 145 Q 19 A 20 146 Q 21 A 22 23 Yes ? A - n - t , we were not allowed to have E - n - t . When was th a t Mr. Lindsay? I d o n 't know. I t might have been somewhere around 1978/1980. 147 Q Could the loans th a t are r e f e r r e d t o here, in t h i s 24 document, be loans in r e s p e c t o f the b u i l d i n g o f the 25 f ac to ry? 26 A 27 148 Q 28 A 29 I t could be but I am not say ing d e f i n i t e l y i t i s . Yes? We now had a f a c t o r y and we had a l o t of people working in i t and we had an exp ens ive Research & 1 Development 2 w h e r e w e h a d to s e l l 7 0 , 0 0 0 u n i t s b e f o r e w e b r o k e 3 even. 4 1 4 9 Q. 5 Department, a n d it g o t t o t h e p o i n t C o u l d I just interrupt you? W h a t is t h e n a m e o f t h e c o m p a n y that you are t a l k i n g about? 6 A. 7 150 Q. 8 A. 9 151 Q. 10 A. 11 152 Q. 12 A. 13 153 Q. 14 Our factory? W h a t was the n ame of the company? I t h i n k it w a s A r d a n t . Ardant? A-r-d-a-n-t. Limited? Yes. It w a s a s e p a r a t e factory. Did Super Ser Limited r e m a i n in b u s i n e s s ? 15 A. 16 154 Q. 17 A. 18 No, no, t h a t r a n dow n. Yes? So, in o ther w ords what we w ere d o i n g was our customers 19 155 Q. 20 A. from Tallaght supplying i n s t e a d of f r o m Sp a i n . Yes? B u t it b e c a m e o b v i o u s t h e n t h a t -- w h e n w e s t a r t e d 21 t o s e l l t h e h e a t e r s a b o t t l e o f g a s w a s 18 s h i l l i n g s 22 o r a p o u n d o r s o m e t h i n g l i k e that , 23 e n a b l e a p e r s o n to g i v e s o m e m e a s u r e o f h e a t t o a 24 house 25 1 5 6 Q. 26 A. and that would f o r a wee k . Yes? B u t b y t h i s t i m e now, u p a b o u t a r o u n d 1 9 8 0 or 27 thereabouts, 28 o f ga s a n d t h a t p l u s t h e f a c t t h a t t h e y d o n o t w e a r 29 out the p l a c e got saturated, it w a s s o m e t h i n g l i k e £1 0 f o r a b o t t l e we k n e w we h a d to get 1 markets 2 se e w h a t c o u l d b e d o n e t h e r e b u t t h e s a l e o f u n f l u e d 3 gas h e a t e r s was 4 t h e r e w a s a m a n i n t h e U n i t e d S t a t e s w h o is in 5 c h a r g e of all standards. 6 157 Q. 7 s o m e w h e r e e l se. So, I w e n t t o A m e r i c a to f o r b i d de n there. If I c o u l d i n t e r r u p t y o u Mr. I went there and Lindsay? I am not today concerned about the company liabilities? 8 A. 9 158 Q. 10 A. 11 1 5 9 Q. Yes, ri g h t . I am concerned about your own personal liabilities? Yes, ri g h t , yes. And your arrangements, your own personal arrangements ? 12 13 A. 14 160 Q. 15 Yes. With Guinness Mahon Cayman Trust Limited and subsequently "Ansbacher"? 16 A. 17 161 Q. 18 Yes. S o u n l e s s w h a t y o u a r e t e l l i n g m e n o w is s o m e t h i n g to d o . . . ( I N T E R J E C T I O N ) ? 19 A. 20 162 Q. 21 A. Well, I t h i n k it is. With your p e r s o n a l ...(INTERJECTION)? Well, I t h i n k -- yes, I t h i n k it has, i n so m u c h as 22 e v e n t u a l l y we w ere s u c c e ss f u l a nd we were the o nly 23 company, 24 n o t h i n g -- w e w e r e t h e o n l y c o m p a n y t o g e t a h e a t e r 25 p a s s e d for the U n i t e d States. 26 163 Q. 27 A. 28 29 Yes. not Japanese, I t a l i a n or Spanish, W e l l ...(INTERJECTION)? A n d t h e n w e s t a r t e d a c o m p a n y in t h e U n i t e s S t a t e s a n d w e a p p o i n t e d a man, 164 Q. German, an accountant. W h a t was the n a m e of that c o m p a n y ? 1 Well, 2 not too sure but 3 we sold was the Shamrock heater. 4 165 Q I n o w -- It p r o b a b l y h a s o u r o w n n a m e . However, ag a i n , I k n o w t h e n a m e of t h e p r o d u c t t h a t I w a n t to e x p l a i n t o y o u Mr. 5 that I am concerned about your own 6 p e r sonal...(INTERJECTION)? 7 A 8 166 Q 9 A 10 167 Q 11 A Relationship with Cayman? Sure . I am not quite certain what relevance this has? Well, w h e n we s t a r t e d the factory, America, 13 a p p o i n t e d to r u n it. 168 Q 15 A Lindsay Yes . 12 14 I am or t h e c o m p a n y in a m a n c a l l e d J o h n G r a c e w a s t h e m a n we Yes? A n d we t r a n s f e r r e d m o n e y from England, from 16 Super Ser UK b e c a u s e the y h a d m ore m o n e y in their 17 a c c o u n t t h a n w e had, 18 A l t h o u g h I w a s n e v e r in C a y m a n I u n d e r s t o o d t h a t 19 t h i s ba n k , 20 169 Q 21 A to s tart this A m e r i c a n company. t h a t w a s l o o k i n g a f t e r us w a s i n C a y m a n . Yes? B u t m a y I s a y t h a t -- I m e a n i n t h o s e d a y s C a y m a n 22 w a s j u s t a n a m e of a n o t h e r b a n k . 23 s o r t of r a m i f i c a t i o n s t h a t it h a s t o d a y . 24 170 Q Mr. Lindsay, w o u l d y o u l o o k at a n o t h e r d o c u m e n t ? 25 (Same H a n d e d ) 26 d o c u m e n t is to you. 27 k n o w w h o Mr. 28 29 A It d i d n ' t h a v e t h e ( E x h i b i t 4). I will e x plain what this T h i s is f r o m Mr. F u r z e is? Furze. Do y o u 1 2 172 Q. He is, i n fact, a M a naging Director, one of the 3 M a n a g i n g D i r e c t o r s of the G u i n n e s s M a h o n C a y m a n 4 T r u s t C o m p a n y in C a y m a n ? 5 A. Yes, 6 173 Q. Yes. 7 A. 8 174 Q. 9 A. 10 175 Q. 11 A. 12 1 7 6 Q. 13 I knew he was a s s o c i a t e d w i t h Des Traynor. T h a t is f r o m Mr. Furze? Right. A n d . . . (INTERJECTION)? A l a n Lindsay, t h a t is it. Yes? T h a t is w h a t I w a s t a l k i n g ab o u t , I a m sure. T h i s is a t r a n s f e r of £ 2 7 0 , 0 0 0 : " S h o u l d be g r a t e f u l if yo u w o u l d arrange the t r a n s f e r of S tg£270,000 t o ..." 14 15 16 Barcelona? 17 A. 18 177 Q. 19 A. 20 178 Q. A. 23 24 17 9 Q. T h i s is f r o m T h e I r i s h I n t e r c o n t i n e n t a l B a n k Well, now, I n e v e r h a d a n y t h i n g to do w i t h Y o u m a y n o t h a v e k n o w n it b u t t h e a c c o u n t w h i c h y o u c o u l d d r a w on ? 26 A. 27 180 Q. 29 Yes. I n t e r c o n t i n e n t a l Ban k. 25 28 T h i s is t h e a c c o u n t of a n A l a n L i n d s a y ? Limited? 21 22 Yes. Yes. W a s at t h a t t i m e -- it h a d b e e n m o v e d t o T h e I r i s h Intercontinental Bank? 1 181 Q is t h a t r i g h t ? 2 3 A 4 182 Q 5 Yes . T h i s w a s p a i d ou t o f t h e a c c o u n t of G u i n n e s s M a h o n C a y m a n T rust in IIB? 6 A 7 183 Q 8 A 9 184 Q 10 A 11 185 Q 12 A 13 186 Q 14 A 15 187 Q 16 17 T h i s is t h e s u m o f m o n e y t h a t y o u p a i d t o y o u r son, Yes . Y o u se e t h e d e b i t ? Yes . Is t h a t c o r r e c t ? Yes. Is it of a n y i n t e r e s t w h e r e I g o t t h a t m o n e y ? Sorry? Is it of a n y i n t e r e s t w h e r e If y o u w a n t to t e l l me, I got that money? yes? I k n o w you w a n t to s t i c k d i r e c t l y on the point. Yes. I w a n t to s t i c k t o y o u r personal.. . (INTERJECTION)? A Yes. F i r s t of a l l t h e b u s i n e s s , the heater 18 business, 19 t r e m e n d o u s l y a n d t h e n s u d d e n l y a l l t h e g as 20 suppliers, 21 themselves, 22 g a s h e a t e r s b e c a u s e it s a y s -- i n t h e S t a t e s t h e 23 legal p o s i t i o n was that peop l e w o u l d start wheel i n g 24 t hem up against 25 l iable for claims and the y h a d o r d e r e d that the 26 s u p p l y of g a s f o r h e a t e r s to b e s t o p p e d . 27 day our busi n e s s was stopped. 28 Yes? 29 Then after that in the U n i t e d S t a t e s b l o s s o m e d . It w e n t a l l t h e S e v e n S i s t e r s as t h e y c a l l s t o p p e d the s u p p l y of gas for p o r t a b l e c u r t a i n s a n d so f o r t h a n d it w a s t o o So, in one I h a d t o do s o m e t h i n g a n d I g o t a 28 1 2 I a m sor r y . 3 because 4 you about your relationship with Guinness Mahon 5 Cayman Trust Limited? 6 A 7 190 Q 8 A 9 191 Q 10 A 11 192 Q 12 A 13 193 Q 14 A 15 194 Q I a m g o i n g to s t o p y o u Mr. Lindsay I j u s t a m c o n c e r n e d to o b t a i n e v i d e n c e from Yes . It l o o k s as if y o u h a d £ 2 7 0 , 0 0 0 ? £270,000, yes. There? Yes . W h i c h was t r a n s f e r r e d to y o u r son? A n d t h a t w a s a f t e r I h a d p a i d fo r t h r e e c h i l d r e n . Yes? For four y e a r s . Yes. However, w h a t I a m s u g g e s t i n g t o you, perhaps 16 y o u c o u l d c o m m e n t o n it Mr. 17 e x t r e m e l y u n l i k e l y that a sum of that m a g n i t u d e 18 w o u l d not be e a r n i n g interest? 19 A I n e v e r got a n y d o c u m e n t s . 20 paper. 21 De s T r a y n o r . 22 195 Q 23 A 24 196 Q Lindsay, is t h a t it is I n e v e r g o t a s h e e t of It w a s a b s o l u t e l y t r u s t a n d I t r u s t e d I am sure of that? A n d I w o u l d t rust h i m again. I a m s u r e o f t h at . However, Mr. Lindsay what I am 25 s u g g e s t i n g to y o u is t h a t it is e x t r e m e l y u n l i k e l y 26 t h a t t h a t sum, 27 Cay m a n Islands, 28 I h a v e a b s o l u t e l y -- I n e v e r g o t a n y i n d i c a t i o n t h a t 29 it wa s. w h i c h was on de p o s i t in the d id not e arn i n terest? He w a s d o i n g m e a f a v o u r . 1 197 Q What did you think? What did you think? W h a t is your thought now about this? 2 3 A 4 198 Q 5 A Well, I am wiser now than I . . . (INTER J E C T I O N ) . W h a t do y o u t h i n k n o w ? Well, if I h a d a t o n of m o n e y t o i n v e s t n o w I w o u l d 6 w a n t i n t e r e s t o n it b u t in t h o s e d a y s he w a s d o i n g 7 me a favour. 8 199 Q 9 Yes. If y o u w o u l d j u s t h a v e a l o o k at a n o t h e r letter there 10 A 11 20 0 Q ( E x h i b i t 5 ) (Same H a n d e d ) ? Yes . It is t h e 1 9 9 2 l e t t e r a n d it is t o Mr. 12 T h e I r i s h I n t e r c o n t i n e n t a l Ba n k . 13 " A n s b a c h e r " h e r e in D u b l i n , 14 It is a l e t t e r t o h i m s t a t i n g : 15 R e d m o n d in It is f r o m 42 F i t z w i l l i a m S q u a r e . " C o u l d yo u p l e a s e a r r a n g e to let me h a v e f o r c o l l e c t i o n a U.S. D o l l a r cheque for U S $ 2 , 3 1 5 . 0 0 p a y a b l e to R a l p h L i n d s a y an d d e b i t the S t e r l i n g cost to " A n s b a c h e r " ..." 16 17 18 T h a t is y o u r s o n R a l p h ? 19 20 A Yes, t h a t is o n e t h a t w a s in c o l l e g e i n A m e r i c a . 21 20 1 Q This is i n 1 9 9 2 a n d y o u a r e d r a w i n g f r o m t h e "Ansbacher" 22 23 A 24 25 202 Q o b v i o u s l y it is f r o m t h e s a m e a c c o u n t in t h e Yes, yes. However, y o u h a v e c o n t r o l of it a n d y o u are d i r e c t i n g that that s u m be p a i d to you son? A 28 29 su m of $2 , 3 1 5 ? Cayman. 26 27 Well, a c c o u n t in I I B in t h i s Yes. All I e v e r h a d t o d o w a s j u s t r i n g Mr. and tell h im that 20 3 Q Yes? I want e d this money. Traynor 1 Its s e e m q u i t e i n c r e d i b l e n o w b u t I m e a n h e w o u l d 2 e v e n say, 3 204 Q 4 Yes. " W h a t do y o u w a n t it f o r ? " y o u know. Di d yo u do this frequently? Did you ask him for m o n e y frequently? 5 A 6 20 5 Q 7 A No, infrequently. Infrequently? A s a m a t t e r of f a c t t h a t s u m t h a t I sent, that 8 sent, to h i m whe n I was w o r k i n g in Bangladesh. 9 was w o r k i n g for an A m e r i c a n firm in B a n g l a d e s h otherwise 10 11 206 Q 12 A Yes ? B u t as a m a t t e r o f fact, y o u know, I certainly don't remember that but 14 he w a n t e d $ 2,000 f o r s o m e t h i n g or a n o t h e r . 207 Q 16 A 18 208 Q Lindsay (Exhibit Y o u se e t h a t t h i s a g a i n a l e d g e r a c c o u n t of Guinness 20 l e f t - h a n d side, 21 Limited." 22 "J.H. A 24 209 Q 25 A 26 21 0 Q 6 ) (Same H a n d e d ) ? Yes . 19 23 I m e a n it is q u i t e p o s s i b l e t h a t I w a n t y o u to r e f e r t o o n e o t h e r d o c u m e n t now, Mr. 17 I I w o u l d n ' t have got that money. 13 15 I got & M ahon Limited. Do y o u see, t h a t it is a n a c c o u n t on the "Amiens T h e n on the 31st O c t o b e r 1986 Lindsay - £1,000 debit"? Sorry, w h a t is A m i e n s ? I w ill tell you n ow in a m o m e n t ? Yes . What I w a n t to s u g g e s t t o y o u is t h a t f r o m 27 A m i e n s L i m i t e d it w o u l d a p p e a r t h a t £ 1 , 0 0 0 w a s p a i d 28 t o y o u in 1 9 8 6 ? 29 A 1 21 1 Q Yes. I w i l l c o m e to t h a t i n a m o m e n t . However, do 2 y o u r e c a l l r e c e i v i n g a p a y m e n t y o u r s e l f o f £ 1 , 000 , 3 o r g a n i s e d b y Mr. 4 A 5 212 Q Traynor? I don't. You could have though? I m e a n it is a l o n g t i m e ago? 6 7 A 8 21 3 Q 9 A 10 214 Q I c o u l d hav e . You could have? Yes . W h a t A m i e n s L i m i t e d was, w h i c h De s T r a y n o r , 11 12 A 13 21 5 Q Mr. Mr. Lindsay, D e smond Traynor, He u s e d t h i s a c c o u n t b y t r a n s f e r i n g f r o m " A n s b a c h e r 's " a c c o u n t i n G u i n n e s s 15 Amiens 16 Amiens. A 18 216 Q 19 20 & M a h o n into and p a y i n g clients of "Ansb ac h e r " out of the T h a t is w h y I a m a s k i n g y o u a b o u t t h i s ? Yes . T h i s w a s a p a y m e n t to you. T h i s w o u l d a p p e a r to b e a p a y m e n t to y o u o r g a n i s e d b y Mr. A operated? Yes . 14 17 was an account T r a y n o r of £ 1 , 0 0 0 ? If it is t h e r e it m u s t h a v e h a p p e n e d b u t I can't...(INTERJECTION). 21 22 217 Q 23 A You cannot remember? I m e a n £ 1 , 000 , it w o u l d n ' t b e t h e s o r t o f s u m t h a t 24 w o u l d b e g o i n g to Des T r a y n o r r e a l l y l o o k i n g for, 25 y o u know. 26 218 Q 27 A 28 29 Yes? U n l e s s it w a s l i k e in A m e r i c a w h e r e i f I w a n t e d monies 219 Q s e n t to R a l p h or t o m y d a u g h t e r a n d that. Y o u w o u l d h a v e o b t a i n e d it? I 1 2 22 0 Q. 3 A. 4 22 1 Q. 5 Yes . Mr. Lindsay, w h a t w e h a v e b e e n d o i n g is b r e a k i n g fo r a short time for a coffee b r ea k ? 6 A. 7 222 Q. Yes . What I w o u l d s u g g e s t is t h a t w e b r e a k f o r a b o u t t e n 8 m i n u t e s n o w a n d y o u c a n h a v e a c u p of c o f f e e if y o u 9 w o u l d l i k e it? 10 A. 11 22 3 Q. W e h a v e n o t g o t v e r y m u c h m o r e t o a s k you. However, if we c o u l d c o m e b a c k in t e n m i n u t e s . 12 13 T h a n k you. A. Yes . 14 SHORT ADJOURNMENT 15 16 17 224 Q. MR. JUSTICE COSTELLO: Mr. 18 Lindsay, we will r e s u m e o u r i n t e r v i e w now. 19 I understand, 20 c l a r i f y som e t h i n g wit h us? 21 MR. HAYES: I n d e e d if I m a y I n s p e c t o r ? 22 MR. JUSTICE COSTELLO: Yes, 23 MR. HAYES: Well, Mr. Hayes, 24 t h a t y o u w o u l d l i k e to yes. it is e n t i r e l y o u r fault b e c a u s e we have not 25 g i v e n y o u a w r i t t e n s t a t e m e n t as w e s h o u l d have . 26 MR. JUSTICE COSTELLO: Yes. 27 MR. HAYES: W e w i l l r e c t i f y th a t . 28 MR. JUSTICE COSTELLO: Yes. 29 r e c e n t l y on that aspect. 1 2 MR. JUSTICE COSTELLO: Yes. 3 MR. HAYES: However, 4 from hearing t h e s e q u e s t i o n s -- I m e a n 5 I t h i n k t h e r e is o n e a s p e c t t h a t d o e s n e e d to b e 6 clarified. 7 MR. JUSTICE COSTELLO: Yes. 8 MR. HAYES: A n d it is t hi s . 9 MR. JUSTICE COSTELLO: Yes. 10 MR. HAYES: That , b y Mr. 11 and I am authorized L i n d s a y to say 12 this, from the v e r y start of his i n v o l v e m e n t with 13 Mr. 14 Mahon which became 15 was enti r e l y a business affair, 16 such. 17 MR. JUSTICE COSTELLO: Yes. 18 MR. HAYES: Up to the t i m e w h e n the Traynor and "Ansbacher" -- so r r y , Guinness " A n s b a c h e r " a n d so fo r t h , 19 ceased and 20 Mr. L i n d s a y m o v e d to B a n g l a d e s h . 21 MR. JUSTICE COSTELLO: Yes. 22 MR. HAYES: Unfortunately, Mr. that i f I m i g h t p u t it as business 23 & L i n d s a y ' s g r a s p of 24 dates 25 a n d g e t t h e e x a c t d a t e s b u t a l l of t h e d e a l i n g s w i t h 26 Mr. 27 were Super S e r ...(INTERJECTION) 28 29 is -- w e w i l l h a v e to c h e c k r e c o r d s a n d t r y T r a y n o r w e r e to do w i t h his com p a n i e s , which 1 2 MR. JUSTICE COSTELLO: However, we have put c e r t a i n d o c u m e n t s to 3 4 Mr. L i n d s a y w h i c h gives c er t a i n dates. 5 MR. HAYES: Yes. 6 MR. JUSTICE COSTELLO: I do n o t t h i n k it w o u l d b e appropriate 7 for you to be 8 g i v i n g us e v i d e n c e t h a t y o u r c l i e n t m a y h a v e t o l d 9 you about. We h a v e to go on the e v i d e n c e that the 10 w i t n e s s g i v e s us. 11 MR. HAYES: Yes. 12 MR. JUSTICE COSTELLO: A n d if he c a n n o t r e m e m b e r we take that into account. 13 14 MR. HAYES: Yes. 15 MR. JUSTICE COSTELLO: However, it w o u l d h e l p us if y o u c o u l d g e t a 16 17 d etailed statement, if he c o u l d p r e p a r e a d e t a i l e d 18 statement. 19 MR. HAYES: Yes, 20 MR. JUSTICE COSTELLO: Yes. w e w i l l do t h a t. A l s o it w o u l d h e l p us if h e w o u l d g e t t h e 21 22 documents f rom his a c c o u n t a n t s b e c a u s e we w o u l d 23 r e q u i r e a l l t h e d o c u m e n t s t h a t t h e a c c o u n t a n t s h a v e. 24 MR. HAYES: 26 myself. 27 MR. 29 As into this 25 28 Yes. I w i l l a t t e n d to th at. JUSTICE COSTELLO: Yes. I say I only came fairly recently 1 2 MR. JUSTICE COSTELLO: 3 MR. HAYES: I do not w a n t to give 4 e v i d e n c e or a n y t h i n g like 5 that. 6 MR. JUSTICE COSTELLO: Yes. 7 MR. HAYES: A n d the s t at e m e n t will m a k e it c l e a r t h a t h i s 8 9 d e a l i n g s w i t h t h e b a n k w e r e o f -- I m e a n I h a v e s e e n 10 the d o c u m e n t s a nd I have seen r e f e r e n c e to h im 11 p e r s o n a l l y and, 12 a c o n f u s i o n a b o u t t h at . 13 t o h i m it s h o u l d r e a l l y h a v e r e f e r r e d 14 t o . ..(INTERJECTION). 15 MR. of c o u r s e , JUSTICE COSTELLO: 16 that. 18 MR. HAYES: T h a t is w h a t y o u say. w e h a v e to d e c i d e Obviously, 19 s e e m to b e It is t h a t w h e n it r e f e r s However, 17 20 but there does yes. I just w a n t e d to m ak e that point. MR. JUSTICE COSTELLO: Yes, I kno w. However, we h a v e the e v i d e n c e that he 21 22 p e r s o n a l l y had money, 23 Mr. 24 in 1986. 25 a c t u a l d a t e s m a y or m a y not be s i g n i f i c a n t , 26 to wait. 27 at s o m e p o i n t i n t i m e h e h a d a p e r s o n a l a c c o u n t in 28 the C a y m a n Islands? 29 Traynor. that he gave m o n e y to H e s a y s h e t h o u g h t t h a t it w a s It w o u l d s e e m to b e e a r l i e r . However, However, the we have w h a t is a b s o l u t e l y c l e a r is t h a t 1 2 MR. JUSTICE COSTELLO: Yes. 3 MR. HAYES: Yo u see in the s t a t e m e n t 4 w e w i l l m a k e it cle ar , 5 t h a t i n r e l a t i o n to t h i s A m e r i c a n b u s i n e s s , 6 h a s s o r t of e x p l a i n e d to you, 7 to s e r v i c e t h a t b u s i n e s s . 8 Mr. 9 a c c o u n t i n t h e C a y m a n I s l a n d s a n d t h a t t h a t is h o w L i n d s a y b y Mr. that he an ac c o u n t was n e e d e d It w a s s a i d to Traynor that th e y w o u l d open that 10 t h e a c c o u n t c a m e to b e o p e n e d fo r t h a t . 11 t h i s is a p o i n t w h i c h h a s n o t b e e n c o n v e y e d b e c a u s e 12 we have not g i v e n a statement. 13 MR. JUSTICE COSTELLO: 14 Mr. Hayes, I think I know that you are tr y i n g to c l a r i f y the 15 situation. 16 MR. HAYES: Yes. 17 MR. JUSTICE COSTELLO: However, 18 w e h a v e to g o on the e v i d e n c e that the 19 w i t n e s s g i v e s us. 20 MR. HAYES: Yes. 21 MR. JUSTICE COSTELLO: At the moment I understand that there was a 22 23 c o n s i d e r a b l e a m o u n t of d e a l i n g w i t h t h e c o m p a n y . 24 have h e a r d e v i d e n c e that t here was £ 4 0 0 , 0 0 0 25 b y t h e c o m p a n y in t h e C a y m a n I s l a n d s . 26 MR. HAYES: Yes. 27 MR. JUSTICE COSTELLO: W h a t we a r e c o n c e r n e d w i t h 28 29 t o d a y is Mr. personal dealings with the company. We lodged Lindsay's own At the moment 1 the e v i d e n c e e s t a b l i s h e s that he h a d p e r s o n a l 2 dealings 3 MR. a n d t h a t is w h a t HAYES: I am c o n c e r n e d w i t h today. If I c o u l d j u s t 4 m ake one final point? 5 MR. JUSTICE COSTELLO: Yes. 6 MR. HAYES: W h e n t h e c o m p a n y c e a s e d to trade, 7 at t h a t p o i n t , 8 u n f o r t u n a t e l y I c a n n o t r e m e m b e r t h e year, 9 Mr. L i n d s a y went to Bangladesh. 10 MR. JUSTICE COSTELLO: Yes. 11 MR. HAYES: A n d it w a s at t h a t p o i n t t h a t he w i l l say, 12 in t h i s 13 statement, 14 between himself a n d . .. (INTERJECTION). 15 MR. JUSTICE COSTELLO: He h a s s a i d t h a t a l r e a d y . 16 MR. HAYES: Yes. that the personal dealings commenced 17 T hen for five years he w a s r e s i d e n t in 18 Bangladesh. 19 MR. JUSTICE COSTELLO: Yes . 20 MR. HAYES: A n d as h e h a s e x p l a i n e d r e m itting the monies, 21 22 w h i c h he e a r n e d t h e r e t o Mr. 23 MR. JUSTICE COSTELLO: Yes . 24 MR. HAYES: I thought that that needed clarity. 25 26 MR. JUSTICE COSTELLO: 29 Yes, v e r y well. You can get the m a t t e r clarified. 27 28 Traynor. MR. HAYES: Yes . 1 2 3 4 Yes . 226 Q 5 t h a t I h a v e r e f e r r e d to, was t r a n s f e r r e d t o y o u r s o n in B a r c e l o n a ? 6 A 7 227 Q 8 A 9 228 Q 10 A 11 229 Q 12 A 13 23 0 Q 14 A 15 23 1 Q 16 17 W h e n the money, Yes . D i d t h a t c l o s e t h e a c c o u n t in C a y m a n ? Yes . Y o u h a d n o f u r t h e r d e a l i n g s w i t h it? No, f u r t h e r at all, no. There was a substantial sum of m o n e y in the account? Yes . At that stage? Yes . H a d y o u d e p o s i t e d m o n e y in t h e a c c o u n t f r o m t i m e to time? A 18 C o n t i n u o u s l y I w o u l d think, almost shipment by shipment. 19 232 Q 20 A 21 23 3 Q 22 A 23 234 Q In y o u r o w n p e r s o n a l a c c o u n t ? Yes . I am talking about? S h i p m e n t b y s h i p m e n t of c a r p e t s f r o m B a n g l a d e s h . In y o u r o w n p e r s o n a l a c c o u n t , 24 Mr. 25 account? 26 A 27 23 5 Q 28 A 29 236 Q T r a y n o r a n d Mr. T r a y n o r p u t it i n t o t h e C a y m a n Yes . That l a s t e d for some years? Yes . t h e m o n e y y o u g a v e to 2 237 Q 3 What I w i s h to k n o w is, did you thereafter deposit money? 4 A 5 2 38 Q 6 A 7 239 Q F ro m a source in B a n g l adesh? 8 A F ro m earnings in Bangladesh. 9 240 Q 10 A 11 241 Q A 14 2 42 Q 16 A 17 243 Q 18 A 19 244 Q 20 A Yes . In B a n g l a d e s h ? Yes . Y o u w i l l t e l l us t h e d a t e o n w h i c h t h a t o c c u r r e d ? Yes, I will. A d a t e as r e g a r d s f r o m w h a t y e a r to A p p r o x i m a t e l y what are we t a l k i n g about? E m . . . (INTERJECTION). A r e we t a l k i n g a b o u t . . . ( I N T E R J E C T I O N ) ? Five years about. However, No, no, i n t h e 1 9 8 0 s or 1 9 7 0 s ? I w a s n ' t i n -- it w o u l d h a v e b e e n in t h e 1 98 0s . 21 245 Q 23 24 A l l t h e m o n e y t h a t w a s i n t h e C a y m a n c a m e f r o m a? w h a t y e a r a n d so f or th. 15 22 not a penny. You will find this out from your records? 12 13 No, In t h e 1 9 8 0 s . Perhaps, I m i g h t g e t it t h i s way: Y o u set up S u p e r Ser? A 25 Yes. I n c i d e n t l y that was the n a m e of the S panish company. 26 246 Q 27 A 28 247 Q 29 A Yes. Super Ser Limited? Yes . It w a s i n c o r p o r a t e d i n I r e l a n d ? 1 248 Q. w a s Mr. 2 3 A. 4 2 4 9 Q. 5 A. 6 25 0 Q. 7 A. 8 25 1 Q. 9 A. 10 252 Q. Yes. W h e n d i d that c o m p a n y c e a s e to c a r r y on t r a d e ? 1982/1983, w a s it? Early 1980s you think? Yes. W a s it t h e n t h a t y o u w e n t to B a n g l a d e s h ? Yes. W h e n you r e t u r n e d after five years what business A. Well, y o u s e e a l l t h e t i m e in t h e b a c k g r o u n d , m y g r a n d f a t h e r ' s tim e, 14 in Ship Street. 15 25 3 Q. 16 A. 17 254 Q. 19 A. 20 25 5 Q. 21 A. 22 2 5 6 Q. 23 A. 24 257 Q. 25 A. shop Yes? A n d a l l t h e t i m e t h a t w a s t i c k i n g o v e r b u t I m e a n it Yes? A n d I had a m an looking after that while I w a s away . W h e n y o u c a n b a c k w h a t d i d y o u do? W h e n I c a m e b a c k I w e n t b a c k i n t o th a t . Yes? T h a t is it a n d t h e n it p a c k e d up. W h a t d i d yo u do then? Then I retired. I m e a n t h a t w a s -- I w a s g e t t i n g o n then. 26 29 we h a d a m o t o r c y c l e from mad e v i r t u a l l y no money. 18 28 with you Goosen? 13 27 a 50% s h a r e h o l d e r , activity did you undertake then? 11 12 Y o u r p a r t n e r i n tha t, 258 Q. When did Ardant Limited establish and your factory establish making these heaters? 1 2 2 5 9 Q. 3 A. 4 5 How long did that company operate Well, for? the m a i n o p e r a t i o n of that c o m p a n y q u i c k l y became the Amer i c a operation. 26 0 Q. W a s t h e r e a s e p a r a t e c o m p a n y e s t a b l i s h e d in the United States? 6 7 A. 8 2 61 Q. Do yo u r e m e m b e r the n a m e of that c o m p a n y ? 9 A. I know the heaters were called Shamrocks. Yes. it w a s c a l l e d A r d a n t . 10 11 2 62 Q. 12 A. 13 Would your accountants Maybe, maybe. manager, know? C e r t a i n l y the m a n who was our t h e m a n w h o l o o k e d a f t e r it, 14 2 63 Q. 15 A. J ohn Grace. 16 264 Q. John Grace? 17 A. A fu rt h e r c o m p l i c a t i o n there. English. 19 b e l i e v e is Q u a n G r a c i a s . 20 26 5 Q. 21 A. 22 2 6 6 Q. 23 A. 24 267 Q. 26 A. 27 268 Q. 29 He s p o k e p e r f e c t He c a m e f r o m G i b r a l t e r . His real name I Yes? But e v e r y b o d y c a l l e d h i m John Grace. W h e r e is h e n o w ? Well, I haven't W h e r e is Mr. Grace now? s p o k e n t o h i m fo r a f e w y e a r s b u t h e li v e d in Norfolk, 25 h e w o u l d know. What was his name? 18 28 Possibly Virginia. In V i r g i n i a ? Yes. V e r y well then. If y o u w o u l d l i k e t o c o n s i d e r w h a t 1 269 Q A n d you could make a further statement then and o b t a i n all the d o c u m e n t s that yo u ca n f r o m t h em? 2 3 A 4 27 0 Q Yes . It is n o t a q u e s t i o n of g e t t i n g a s e l e c t i o n of 5 documents, 6 s o l i c i t o r s m i g h t h a v e in r e l a t i o n t o y o u r o w n 7 personal.. . (INTERJECTION)? 8 A 9 27 1 Q T h e r e is o n e f i n a l m a t t e r t h a t about. 11 t e l l us, A 13 272 Q 14 I want to ask you It d o e s a p p e a r t h a t S u p e r Ser, from what you c e a s e d to c a r r y o n b u s i n e s s ? Yes . There are v e r y s u b s t antial sums of m o n e y that S uper Ser a p p a r e n t l y h ad on d e posit? 15 A 16 27 3 Q 17 A 18 274 Q 19 A Yes . $ 4 0 0 , 0 0 0 a c c o r d i n g to t h i s d o c u m e n t ? Yes . W h a t b e c a m e of the funds? It d i s a p p e a r e d l i k e t h a t i n so m u c h as w h e n -- we 20 had endless orders. 21 A m e r i c a n t e l e v i s i o n with , 22 about t h e . . . (INTERJECTION). 23 that your Yes . 10 12 it is a l l t h e d o c u m e n t s , 27 5 Q 24 W e t o o k a h a l f a n h o u r on y o u know, people talking I am not talking about the A m e r i c a n company. talking about the Irish company? 25 A 26 276 Q 27 A 28 277 Q 29 A Yes . That had ve r y substantial sums on d e p osits? Yes . Of $ 4 0 0 , 0 0 0 in " A n s b a c h e r " ? I am 1 278 Q 2 A 3 279 Q 4 A 5 28 0 Q 6 A 7 28 1 Q 8 A 9 282 Q 10 A Yes . And substantial s u m s in L o n d o n a n d i n N e w Y o r k ? Yes . Or in A m e r i c a ? Yes . W h a t b e c a m e of t h e f u n d s ? Yes, j u s t -- m a y I j u s t s o r t t o g e t t o t h a t ? Yes ? We had the orders. So, we got bi g loans 11 Guinness 12 W e g o t b i g l o a n s a n d t h e n s u d d e n l y it w a s 13 l i k e th at. 14 took everything. 15 28 3 Q 16 & M a h o n to s e r v i c e t h i s A m e r i c a n m a r k e t . It j u s t s t o p p e d a n d G u i n n e s s A 18 284 Q 19 A 20 28 5 Q stopped & Mahon T h e y j u s t t o o k it l i k e tha t. T h e n it w a s S u p e r S e r t h a t y o u s a y w e r e s e r v i c i n g the Am e r i c a n market? 17 from Y e s -- no, no, The Irish company here? the m o n e y came from England. Yes ? B e c a u s e t h e y h a d the m a j o r i t y of the money. Y o u a r e g o i n g to t e l l us w h e n S u p e r S e r c e a s e d 21 trading? 22 w e h a v e t h a t S u p e r S e r w a s a c l i e n t of " A n s b a c h e r " 23 a n d w e w o u l d h a v e to i n v e s t i g a t e S u p e r S e r ? 24 A 25 286 Q However, it d o e s a p p e a r f r o m t h e r e c o r d s Yes . Apart f r o m y o u is t h e r e a n y b o d y e l s e t h a t c a n a s s i s t 26 us in r e l a t i o n to S u p e r S e r a n d i t s a c c o u n t s a n d its 27 dealings with 28 29 A "Ansbacher"? I d o n ' t e v e n k n o w -- I m e a n I a m s u r p r i s e d w h e n I saw that there. I think that our (inaudible) with 1 Guinness 2 r e m e m b e r Mr. 3 h a v e s o l d a b a n k in C a y m a n t o a S o u t h A f r i c a n 4 c o m p a n y " w h i c h I h a v e n ' t h e a r d m e n t i o n e d s in ce. 5 287 Q. 6 A. 7 288 Q. T r a y n o r t o l d m e o n e day, 9 A. 10 2 8 9 Q. 11 A. h e said, "I Yes? A n d that , No. I think, was one of your last meetings. I a m a s k i n g y o u a b o u t S u p e r Ser, W h a t a b o u t Mr. 8 Goosen? Mr. Lindsay. W h e r e is h e ? He l i v e s i n E n g l a n d . Yes? He a n d I h a d a b i g d i s a g r e e m e n t a b o u t it. He d i d n ' t w a n t to go to A m e r i c a a n d e v e n t s p r o v e d h i m right. 12 13 & M a h o n m o r e o r l e s s c o i n c i d e d -- I 29 0 Q. Is t h e r e a n y b o d y e l s e t h a t c a n h e l p us a b o u t t h e 14 Super Ser company apart 15 accountants? 16 A. 17 29 1 Q. 18 from yourself? Did you have Did H a ughey Bol a n d look after you? Yes. W o u l d you ask your accountants for a n y r e c o r d s that t h e y h a v e in r e l a t i o n to S u p e r S e r ? 19 A. 20 292 Q. Yes. A n d in p a r t i c u l a r in r e l a t i o n t o t h e d e p o s i t s t h a t S u p e r S e r h a d in t h e C a y m a n I s l a n d s ? 21 22 A. 23 29 3 Q. 24 A. 25 294 Q. 26 A. Yes, certainly. Very well then? M a y I add? Yes? It s e e m s a n i n c r e d i b l e n a i v e a p p r o a c h t o t h i n g s n o w 27 b u t I w a s t r a i n e d as a f i t t e r a n d t u r n e r a n d f o r m e 28 to m a k e s o m e t h i n g that p e o p l e in A m e r i c a w o u l d b u y 29 in c o l o s s a l n u m b e r s w a s a d r e a m . 1 29 5 Q 2 A A n d w h e n it j u s t s h u t d o w n l i k e t h a t a n d 3 Guinness 4 w a n t t o b l o o d y k n o w w h e t h e r w e o w e d t h e m m o n e y or 5 w h e t h e r t h e y o w e d us m o n e y . 6 296 Q Yes. & M a h o n t ook all the m o n e y I d id n ' t even V e r y well. T hank you for your assi s t a n c e 7 Mr. 8 t h e n in t h e l i g h t o f t h e d o c u m e n t s ? Lindsay. 9 A 10 297 Q 11 A 12 298 Q T h a n k you. 13 A T h a n k you. 14 W e c a n l o o k at t h e s i t u a t i o n a g a i n Yes . T h a t y o u s e n t o n to u s ? Yes. MR. Al l right. HAYES: T h a n k you. 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE E X A MINATION WAS THEN CONCLUDED. Mka Soukde Wu? at Super Ser/H. Lindsay Super Ser Halted - £1.336.023 £1.179.486 Purpose: Working Capital and a t i l l discounting fa c ility . Security: (a) Super Ser Limited has deposits of around £400,000 with Guinness & Mahon Cayman Trust Limited.. (b) The company has deposits with Guinness 1 Mahon, Dublin of around £790,000. (c) ' The company placed U.S. Dollars 4 million on deposit with Guinness & Mahon, Dublin. This deposit has been ■ transferred to the parent office in London. The Dublin office has a Hen on these funds (around £2.1 m illion) as fw #a »» thd loan . PRIVATE A N D CONFIDENTIAL T h e Inspectors, T h i r d Floor, T r i d e n t H o u s e , ' ' 1 Blackrock, C o . Dublin RE: 3 December, 2001 H A R R Y 1 J N D 5 A Y A N D S U P E R S E R LIMITED D e a r Sirs, W i t h r e f e r e n c e to y o u r letter of t h e 7 th N o v e m b e r , o u r Client w a s n e v e r i n f o r m e d b y t h e P o s t Office that t h e s e letters f r o m y o u w e r e available for his collection. W i t h r e f e r e n c e to y o u r “ P r e l i m i n a r y C o n c l u s i o n s ”, M r . L i n d s a y did a c k n o w l e d g e in t h e c o u r s e of his e x a m i n a t i o n b e f o r e t h e In s p e c t o r s that h e w a s i n d e e d a Client of A n s b a c h e r a n d , a s a Director of S u p e r S e r Limited, that that C o m p a n y a l s o w a s a Client of A n s b a c h e r . H e w o u l d h o w e v e r like to m a k e t h e point that at that time, t h e r e w a s n o s u g g e s t i o n of a n y i m p r o p r i e t y in b e i n g a c u s t o m e r o f that B a n k . It is o n l y in r e c e n t y e a r s that e v i d e n c e h a s e m e r g e d in th e public d o m a i n w h i c h , a s y o u p u t it in y o u r letter, “ justifies findings a n d / o r i n f e r e n c e s that y o u m a y c o n s i d e r to b e a d v e r s e to y o u r interests, g o o d n a m e a n d / o r reputation". O u r Client w a s i n t r o d u c e d to this Institution, in t h e m a n n e r h e h a s d e s c r i b e d in his e v i d e n c e to y o u , b y Mr. T r a y n o r , a n d w a s no t a w a r e of a n y t h i n g at all i m p r o p e r in his c o n d u c t i n g t h e b u s i n e s s that h e did c o n d u c t at that t i m e with Mr. T r a y n o r . I.-.. . Y 6 unfaithfully; G O R E & GRIMES' A p p e n d ix X V (1 2 4 ) M r & M r s P e te r T a m b u r o 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r & Mrs Peter Tamburo. a) Letter of 9 M a y 1974 - G M C T to M r Peter Tamburo. b) Letter of 23 December 1981 - G M C T to Guinness and Mahon. .. „r: GUINNESS MAHON CAYMAN TRUST LIMITED A Mambar of tha Culnnaaa Mahon Marehant Banking Group Talaphona No 8— 6293/4 Tate* CP 308 Cabla AcSdraa* Gulnnaa* P. O. Bo* 887 Grand Cayman •*** w«*< ". 9th May, 1974 your n f our ra( JAFsee raivATE t a a g m B w a a L fv-:> Fobs A . Tanfau ro , Esq. 2520 Dellago D rive F b rt Lauderdale, F lo rid a U. S . A. Dear Pete, Fo llo w in g fllsaissinns which I had v i t h Des w h ils t h* was i n Cayman, I have arranged to farm a ooqpany, Windsor S e cu ritie s Lim ite d, and a T r u s t on jo u r behalf. Enclosed are copies o f the Msnotanaum and A r t ic le s o f Association o f the canpany, together w ith a ccpy o f the C e rt if ic a t e o f Incorporation. and a copy o f the T r u s t Deed, Deed o f Appointment and L e tte r o f Wishes, a l l o f which I have executed. > ” Bather than d w e ll a t length on an explanation o f each document I have sent copies o f everything to Des w ith a covering l e t t e r and I am sure th a t when next i n F o rt Lauderdale he w i l l explain the se t-u p to jo u . Should e ith e r John o r I see ysu p r i o r t o your next v i s i t from Des then we w i l l o f course be o n ly too happy to explain the s itu a tio n in f u l l . Best wishes, ' Yours s in c e re ly . JOHN A . FURZE ends GUINNESS MAHON CAYMAN TRUST LIMITED A Monktr of tha Gu m im m Mahon Maretiant Banting Group TMapMna No 9 -4MJ 4 *O.Sa« M» iC 0r,"d Cl*m,n o* aos C tal. Juidr... Ouinnaat SrW.h W m Intfaa your rof December 23» 1981 JAF/rab G uinn ess & Mahon L t d . 17 C o lle g e Green D u b lin 2 Ir e la n d A t t e n t i o n ’. P e te r Keane D ear S i r s : RE: WINDSOR SECURITIES L T D . We a c t as managing agents f o r the I s r e g is t e r e d I n the Cayman Is la n d s . above company w hich The shares which were r e c e n t ly a c q u ire d i n TUNNEL HOLDINGS L T D . were purchased i n the name o f Overseas Nominees L im ite d and a re h e ld b e n e f i c i a l l y f o r th e above company. We c o n firm th a t the u lt im a t e b e n e f ic ia l owners o f the e q u it y o f W indsor S e c u r it ie s L t d . a re M r. & M rs. P e te r A. Tam huroj hof.h o f whom are U n ite d S ta te s c ltis e e «s wv*. r e s id e n t s . A p p e n d ix X V (1 2 5 ) M r K a z u a k i T a z a k i 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Kazuaki Tazaki. a) Letter of 16 June 1983 - J D Traynor to M r Kazuaki Tazaki. b) G M C T external call deposit statement of 15 June 1983. c) G M C T external call deposit statement of 30 April 1983. d) G M C T external call deposit statement of 31 January 1983. e) Letter of 11 June 1985 - J D Traynor to M r Kazuaki Tazaki. f) Letter of 12 September 1988 - J D Traynor to M r Kazuaki Tazaki. g) Letter of 17 October 1988 - M r Kazuaki Tazaki to J D Traynor. A 17, COLLEGE GREEN, DUBLIN, • r PERSONAL 1 6 th June, 1983. K . T a z a k i, E s q ., . B r o t h e r I n t e r n a t i o n a l E u ro p e L t d . , S h e p le y S t r e e t , ■ G u id e B r i d g e , A udenshaw , • MANCHESTER. M34 5 J D . D ear K aye, . F u r t h e r t o o u r r e c e n t d i s c u s s io n s I have, p l e a s u r e i n a t t a c h i n g h e r e t o c o p y S t a t e m e n t l o r A / J s h o w in g a b a l a n c e . o f £ 2 8 , 8 5 7 . 1 8 a s a d v i s e d i n o u r r e c e n t 'p h o n e c a l l . I k e p o s i t i o n on t h e A c c o u n t i s as f o l l o w s : B a la n c e Add: as at T ita n In v e s tm e n ts L im ite d 1 6 /6 /1 9 8 1 D o lla r $ 1 3 ,2 0 1 .9 9 I n t e r e s t fr o m 1 6 / 6 / 8 1 - 1 6 / 1 2 / 8 1 I n t e r e s t fr o m 1 6 / 1 2 / 8 1 - 1 6 / 6 / 8 2 I n t e r e s t fr o m 1 6 / 6 / 8 2 - 1 6 / 1 2 / 8 2 1 ,0 9 0 .5 3 9 9 3 .3 2 1 .1 1 6 .9 9 3 .2 0 0 .8 4 $ 1 6 .,4 0 2 . 8 3 W ith k in d e s t r e g a r d s , T o u rs s i n c e r e l y , J»D . T ra y n o r. . ,..y . A /J GUINNESS HAHON CAYMAN TRUST LTD . \ : • ■ •.-I---7' •} . . > /.. . • . ---------- ' ' i '..'iw tmHESti STERLI NG external OEPOSI T . CALL jf!. **,•'•*1 , . . . - J - • . . • . . . . . . .• li —•-. . . . ■. . . . . .• - .. ■ r- fc* ft. .J l" . J -.-K • • v- . jX nWji _r . _ 9 6 2 4 2 A 3 2 / 1 6 , tT.___ . . v.:. - - ... i*7- . .. ; . V-.v**-"' • • '-1-5J U*<85----•** l*• •t . • * _ir.* MAy8 3 BALANCE BROJGHT FORWARD . . . . . . . - iW-i.J-.’ .j jfi ..238.57.18 ifI_mX i.\. .'ui ax ' ■ ■ . • - — - • - ' — * ‘j r i i f . . •’ -'-Mil - >‘.i >■ . " . , •• ^ .. C=. • • M * • ..* !. * _ • .• ■ , . • t *. *\ *i . :.t>y; , .j* .'•-.•'.ii ) . ACCOU NT 'N A M E . GUINNESS MAHON CAYMAN TRUST LIMITED?;, V 1 P.O. Box 887 ' Grand Cayman British Watt Indlai . Talax CP 306 Cabla A ddran Gulnnan A / J GUINNESS MAHON CAYMAN TRUST LTD CURRENCY STERLING ACCOUNT DESCRIPTION EXTERNAL DEPOSIT CA(.U • . LEPGER Talaphona No B-4693/4 • • ' • account number 96242/0271 s t a t e m e n t d a te 30APR83 •I i . . E • VALUE DATE PARTICULARS DEBIT CREDIT %• a. B A L A N C E B RO UG HT H A T E CHANGE IN TER E ST *8 3 R 83 RB3 r TORWARD . 0 .0 0 2 B *1 2 5 i> lT ^ S 7 3 1 .2 7 * % 1 . BALANCE 8 5 7 ,3 • . • ; : •«— » :,* r*r > . i : l, * • . ’* . • . • • • . • • - _* 1 #; ; •• *• * .••»■••s. 1 - • **rv‘* ,........ . 0 *•• *•» ***».>,«M • • » • . • • • • M *•.• • •A«•*i*(.. S.l« .• .. •+ ••«-•*. .*»e«n • » • •- V. * HV . • « , S• 1 i.\v /• . * ..•*#! ■ :'l • • , Amnaixixvr GUINNESS MAHON CAYMAN TRUST UMITED; ACCOUNT NAME A/ J GUINHE.SS MAHON CAYMAN TRUST LTD CURRENCY S T IR L IN G ACCOUNT DESCRIPTION E XU R N A L DEPOSIT PARTICULARS BALANCE DROUGHT FORWARD RATE CHANGE INTEREST P.O. Box 887 Talax CP 306 Grand Cayman BritUh W att India* CaWa A ddran Q ulnnai a c c o u n t n u m .b r c alc LEDGER VALUE DATE STATEMENT OATS DEBIT CREDIT Talaphooa No 9—4653/4 ■ . 96242/02/16 31JANH3 BALANCE 2 7 # 4 78,8V 3 1 D tC 8 2 0 .00 2 7 # 4 7 . 8 . 8 4 - -l£ 6 4 7 .0 7 2 8 ,1 2 5 .9 1 PLEASE NOTE OUHN6W TELEPHONE NO. rfr 7 9 6 944 J v -.%' . 17f COLLEGE GREEN, D U B L I N , 2. & PERSONAL R . T a z a k i, E s q ., B r o t h e r I n t e r n a t i o n a l E u ro p e L t d . , S h e p le y S t r e e t , • G u id e B r i d g e , Audenshaw, MANCHESTER M34 5 J D . D ear K aye, On t h e rTv,T,a- ia O T T t h a t th e b a la n c e on G .M . C . T . A / J D e p o s it A c c o u n t w as S t g . £ 2 8 , 8 5 7 . 1 8 . T h is i s j u s t t o a d v is e y o u t h a t t h e b a l a n c e o n t h e A c c o u n t as a t 2 9 t h M a rc h 1 9 8 5 am o u n te d t o S t g . £ 3 4 . 4 7 7 ; 3 5 ^ t h e o n l y e n t r i e s i n th e in t e r v e n i n g p e r io d b e in g a d d it io n s f o r in te r e s t. . I n a y l e t t e r o f t h n 1 7 t h iTlinft I a d v is e d t h a t t h e b a l a n c e on t h e T i t a n I n v e s t m e n t s D e p o s i t • a m o u n te d t o D ,S . $ l T r , 1 7 5 . 0 7 . S in c e t h a t t im e t h e o n l y a d ju s t m e n t s h a v e b e e n a d d i t i o n s o f i n t e r e s t a n d t h e D e p o s it now s ta n d s a t t t , sf. f 9 n ( n a a i T - a n H * a s p l a c e d ‘t o m a t u r e o n 1 8 t h J u n e 1 9 8 5 i t 9 j% p . a . T«L 786881/783048 T tta c 83440 F a c sM te 61SW3S 19 L O W E R P E M B R O K E STREET. DUBLIN 2. * E p l9 8 & PERSONAL •. 1 2 th S e p te m b e r, 1988. K . T a z a k i, E s q ., B r o t h e r I n t e r n a t i o n a l E u ro p e L t d . , S h e p le y S t r e e t , ■ ■ G u id e B r i d g e , . Audenshaw , MANCHESTER M34 5 J D . • Dear K aye , . . ' I an v e r y p le a s e d t o c o n f ir m t h a t H e n ry A n s b a c h e r H o ld in g s PLC h a s a c q u ir e d 75% o f G u in n e s s Mahon Cayman T r u s t L i m i t e d w i t h Management h o ld in g t h e re m a in in g 25% . A t t a c h e d h e r e t o i s a co p y of th e announcem ent made i n Caym an. You I h l r l u e n a u t h o r is e d fo r th e to u n d e rta k e t im e b e i n g b e m ade w i t h and w it h o u t a c c o u n t in g in p a r t ic u la r o f th e upon t h e sam e t e r n s an o r d in a r y fo r any p r o f it a n d w it h o u t p r e ju d ic e f o r e g o in g a s w o u ld cu sto m e r t h e r e b y m ade a n d to th e g e n e r a lit y t h e T r u s t e e s m ay r e t a i n on c u r re n t a c c o u n t o r d e p o s it a c c o u n t o r ad v an ce a t in t e r e s t m oneys n e c e s s a r y o r c o n v e n ie n t t o b e r e t a i n e d i n c o n n e c t io n w it h t h e T r u s t a n d m ay r e t a i n a n y c o m m is s io n o r r e m u n e r a t i o n p a i d b ro k e rs lia b le in s u r a n c e a ll o r advanced fo r t h e m s e lv e s j, o r a llo w e d ' b y s t o c k ­ c o m p a n ie s o r o t h e r a g e n t s w i t h o u t b e i n g to a c c o u n t fo r any p r o f it th a t th e T r u s t e e s t h e r e b y P R O V ID E D f u r t h e r m ay t r a n s a c t b u s i n e s s on b e h a lf o f th e T r u s t o r a n y b e n e f ic ia r y h e re u n d e r w it h a n y c o r p o r a t io n o r p a r t n e r s h ip in o r s h a r e h o ld e r s in t e r e s t e d w h ic h or w it h o u t b e in g th e T r u s t e e s a n y p e rso n o r f ir m f in a n c ia lly lia b le as such a s a r e s u lt o f su ch o f f ic e in lia b le fo rm in t e r e s t e d o f f ic e h o ld e r s b u s in e s s an d a c c r u in g s h a r e h o ld e r s to or p a rtn e r* m ay h o l d * s h a r e s o r s e c u r i t i e s w h ic h s h a ll n o t be t h e T r u s t f o r e m o lu m e n t s r e c e i v e d such o f f ic e 8. (a ) THE T ru s te e s h e re o f h o ld e r s m ay a t a n y t im e o r ''t h e A p p o in t o r " ) (w h e th e r o r i g i n a l o r t im e s b e re m o v e d fro m t h e i r o f T r u s t e e b y a Deed e x e c u te d a f t e r c a lle d th e T ru ste e s H to sh ares or th e T r u s t e e s b y th e m a s o f f ic e In h o ld e r s f in a n c ia lly h o ld in g p a r t o f th e T r u s t Fu n d and to a c c o u n t s u b s t it u t e d ) o f f ic e to acco u n t fo r an y p r o f it a n y c o r p o r a t io n c o m p r is e o r are p a r t n e r s o r a r e o t h e r w is e o r w it h b e in g o t h e r w is e th e T r u s te e s 1 b y th e and d e liv e r e d S e t t lo r to ( h e r e in ­ th e T r u s te e s and t h e A p p o i n t o r m ay b y d e e d e x e c u t e d a n d d e l i v e r e d a s \ a f o r e s a id a p p o in t a n y o th e r p e rs o n o r p e r s o n s w h e th e r o r n o t i*i««1»i#.*111. / ...... * r e s id e n t J o in t ly if and in th e w it h a fte r Caym uu I s la n d s to be T ru s te e s a n y o th e r th e n c o n t in u in g re m o v a l th e re s h a ll T ru stu o a no t he any c o n t in u in g o r e x p e d ie n t v e s t e d jo in t ly w h o s h a l l t h e r e u p o n b e co m e t h e T r u s t e e s cre a te d lia b le P R O V ID E D h o w e v e r , as a tru ste e p e rso n bee one n o t be bound T ru ste e * r e a s o n a b le o u t g o in g or o th e r tra n u fe r s e c u r it y tru ste e is d u t ie s th e T r u s t p r o v id e d a g a iu s t s u c h ( e it h e r w it h s u c h re m o v a l a tru st th e re s h a l l r e m a in a t c o r p o r a t io n . (b ) (a ) o r tw o t r u s t e e s o f th e C la u s e o r ig in a l o r s u b s t it u t e d be d is s o lv e d any of th e o r s h a l l d e s ir e tru ste becom e u n f i t to t h e r e in th e th e n to t h e r e in f o llo w in g u n a b le o r h e re o f ta x e s one o r b e in g h e r e o f w h e th e r a c o r p o r a t io n or s h a ll fro m re fu se o r becom e in c a p a b le a ll or or o f a c t in g n a m e ly : if he s h a ll be act The s u r v iv in g or c o n t in u in g t im e b e in g th e . p o w ers c o n t a in e d to th e such in d iv id u a ls u n w illin g fo r u n le s s tru ste e b e d is c h a r g e d or s h a ll o r w i t h o u t a new to p e rso n s . fo r any a f o r e s a id a T ru ste e d ie The S e t t lo r (11) if w ho i s s h a ll be e f f e c t iv e b e in g o r p o w ers h e r e o f act ( i) or e h a ll or h e re b y P R O V ID E D AISO t h a t le a s t W it h o u t p r e j u d i c e s u b -c la u s e th e re o f lia b ilit y u n le s s p e rso n s o f any in d e m n if y in g th e A p p o in t o r a p p o in t m e n t ) d e a th fe e s no r e m o v a l o f t r u s t e e s b y a fte r th e tru ste e Pund a s fo r in as th e T r u s ts t h a t a n o u t g o in g a s a f o r ia o r t r u s t e e e sta te to of h e r e o f o r m ay o n t h e lia b le in c o m e p r o b a t e ‘ o r s o le ly th e re u p o n th e T r u a t Fund s h a l l b e by su h a s s u r a n c e n a y be n e c e s s a r y in e it h e r b e in g or if dead T ru ste e s th e re be no ■ Filtuun ( iii) Tho la s t p e r s o n a l r e p r e s e n t a t iv e s s u r v iv in g w as a n T ru ste e if such in d iv id u a l b u t i f w as a c o r p o r a t io n such th e n su c h o th u r p e rso n s n o t b e in g or - . th e p o w er) p la c e of to C la u s e The c o n t a in e d nay a t by a deed e x e c u te d T ru ste e s and ta k e as th e r e s ig n a n y t in e o r b e in g (a ) be ir r e v o c a b ly lik e O F T H IS r e le a s e d d e liv e r e d to th e m anner r e v o c a b ly p o w ers t o o r ig in a l o r s u b s t it u t e d ) a s T ru ste e s In t e n t io n to th e A p p o in t o r t in e th e a f o r e s a id any p e rso n o r p e rso n s th e d e a th The T ru ste e s h e re o f o r t h e ir to in of t h e A p p o in t o jc nay be of t in e r e f u s iu g s u b -c la u s e in m e d ia t e ly o r a f t e r (d ) (w h e th e r t« o r T ru ste e s as t h e A p p o in t o r n a y i n e ffe ct case p o w ers i n s a id e x e r c is in g so deceased dissolved in c a p a b le th e (w h e th e r o r p e rso n s b y t h e A p p o in t o r a n d o r ir r e v o c a b ly g r a n t to th e be d is c h a r g e d o r b e in g (c) a p p o in t o n e o r be a T ru ste e th e T ru s te e d e s ir in g u n f it to * tru ste e o r c o r p o r a t io n In c lu d in g T ru ste e l a s t 'T r u s t e e la s t upon r e t ir e m e n t n a y b y d eed n o ro la s t o l th e h e re u n d e r a f t e r so in th e y so p e rso n a s w r it in g upon th e th e n o t ic e p r e p a id post A p p o in t o r m ay fro m su ch r e s ig n a t io n d ay s p e c if ie d th e n d e s ir e 30 d a y s w r it t e n do s e n t b y r e g is t e r e d or such a p p o in t becom e e f f e c t i v e to nay i f any o f in such s h a ll n o t ic e of r e s ig n a t io n \ (e ) / ...................... (a ) In th e e v e n t o f th e r e s ig n a t io n h e r e o f ox* i u G u in n e s s cauo th e re s h a ll be o f th e T r u s t e e s no t r u s t e e h e re u n d e r lb ih o u BuUuiouu T r u s t C o m p a n y L i m i t e d su ccesso rs (f) or it s s h a l l b e co m e s u b s t i t u t e d T r u s t e e s h e r e u n d e r Upon th e r e s ig n a t io n a s h e r e in b e f o r e to r e c e iv e p r o v id e d o r re m o v a l o f th e T r u s t e e s th e T ru s te e s r e im b u r s e m e n t b u t o f e x p e n se s In c u r r e d b y th e m i n s h a ll be e n t it le d th e T r u s t fu n d f o r a l l c o n n e c t io n w it h th e S e t t l e . a m ent o f (g ) tb e a c c o u n t o f th e T r u s t e e s On e v e r y c h a n g e i n s h a ll be en d o rse d m ent s t a t i n g th e th e t r u s t e e s h ip on o r p e r m a n e n t ly a f f i x e d nam es o f th o T r u s t e e s an d s h a l l b e s ig n e d b y tb e p e r s o n s s o a te d b y a n o ta r y o r n o t a r ie s p u b lic w it h th e T r u s t s h a ll be e n t it le d m em orandum (o r th e t h is th e f u lly to t h is th e S e t t le ­ t im e b e i n g nam ed a n d a u t h e n t i c ­ an d a n y p e rso n d e a lin g to r e ly upon an y s u c h l a t e s t o f s u c h m e m o ra n d a i f o n e ) a s s u f f i c i e n t e v id e n c e are fo r a m em orandum m o re t h a n t h a t t h e p e r s o n s nam ed t h e r e i n c o n s t it u t e d T r u s t e e s f o r t h e t im e b e i n g o f S e t t le m e n t (h ) •A n y s u b s t i t u t e d s h a ll have a l l la w a n d t h e s e T ru ste e s o f t h is t h e p o w ers c o n f e r r e d s h a l l be a u t h o r is e d to of a ll th e c u s t o d ia n s o f th e T r u s t Fund d o cu m e n ts o f t i t l e fro m th e d is p o s it io n s T H E T r u s t e e s s h a l l p r o v id e by banks b ro k e rs a c c e p t in s t r u c t io n s s u b s t it u t e d T r u s te e s - a s to 9. upon th e T r u s te e s p r e s e n ts and an y and a l l n o m in e e s o r o t h e r d e p o s i t o r i e s S e t t le m e n t fo r and s e c u r it ie s s a id th e re o f th e s a f e k e e p in g th e s u b je c t of t h is s e t t l e m e n t a n d m ay a t t h e e x p e n s e o f t h e T r u s t Fund ( w h ic h e x p e n s e m ay i n c l u d e sa fe c u s to d y o f s e c u r i t i e s ' and th e c o lle c t io n in c o m e ) d e p o s it t h e -s a m e i n any ch arg e s fo r w o r ld t h a t u n d e r t a k e s t h e s a f e any par e o f th e cu sto d y o f s e c u r it ie s as p art b u s in e s s b u t so t h a t th e T r u s t e e s s h a l l n o t be i n w is e r e s p o n s i b l e f o r th e m is a p p lic a t io n b y s u c h b a u lk in g c o m p a n y c o r p o r a t e 10 . IN o r o th e r d u t ie s any o f t h e sa m e o r a n y o f th e tru ste e o r sto ck b ro k e r o r f o r a n y l o s s w h i c h m ay b e o c c a s i o n e d t h e r e b y Is la n d s a n d r e m it t a n c e o f t h e c u s t o d y o f a n y b a n k b a n k in g com pany c o r p o r a t e - t r u s t e e o r s t o c k - b r o k e r i n of it s th e • t h e e v e n t o f a n y in c o m e p r o b a t e e s t a t e .o r fe e d th e U n it e d o r t a k e s b e c o m in g p a y a b l e i n S ta te s o f A m e r ic a o r e ls e w h e r e th e Caym an in r e s p e c .t o f th e T r u s t Fund o r an y p a r t th e re o f on th e d e a th o f th e S e t t lo r o r o f a n y B e n e f i c i a r y o r o t h e r w is e d is c r e t io n pay a l l t h e T r u s t e e s m ay a t t h e i r o r an y p a r t o f su ch d u t ie s f e e s and ta x e s o u t o f th e T r u s t F u n d w it h o u t r e c o u r s e a g a i n s t a n y B e n e f i c i a r y o r re fu se to p ay th e s a m e 'o r a n y p a r t t h e r e o f u n l e s s i n d e m n i f i e d a n d t o d e t e r m i n e t h e t im e a n d m a n n e r o f s u c h paym ent i f any 11. NO b o n d s h a l l b e r e q u i r e d n a m ed o f th e T ru s te e s (w h e th e r o r i g i n a l o r * s u b s t it u t e d ) b e r e q u i r e d b y la w is ' e f f e c t iv e to no s u r e t y or i f a b o n d s h o u ld t h e e x t e n t t h a t a w a iv e r b y t h e s h a l l b e r e q u ir e d h e r e in S e t t lo r on s u c h a bond . 12 , T H IS T r u s t s h a l l be e x p r e s s ly v a lv e s a ll c o n ju n c t io n w it h any o th e r p e rso n t h is S e t t le m e n t in r ig h t ir r e v o c a b le and w h o le o r and th e S e t t lo r p o w e r w h e t h e r a l.o n e o r in to p a rt a lt e r or as am end o r r e v o k e to any of it s te rn s ' 13 , TH E T ru ste e s on co n tra o t s h a ll no t be m ade b y t h e n in T r u s t and p e rs o n s e n t e r in g s h a ll lo o k s o le ly 14 , to of th e T r u s te e s it is to d is c lo s e th a t h e re b y is to d e c la r e d o f th e in t o c o n t r a c t s w it h th e T r u s te e s to Fund to re fu se th a t lia b le a d m in is t r a t io n th e T r u s t to p e r s o n a lly . th e W IT H O U T p r e j u d i c e la w in th e r ig h t d is c lo s u r e th e T r u s te e s any p e rso n any of th e under th e of g e n e ral a n y d o cum ent s h a ll ! n o t be bound f o llo w in g . d o cu m e n ts s a y :(1) A ny d ocuaent d is c lo s in g io n s o f th e T r u s t e e s (o r a n y * m an n er i n w h ic h t h e T r u s t e e s an y d is c r e t io n co n fe rre d m ent o r d i s c l o s i n g an y d e lib e r a t ­ of th e T r u s t e e s ) a s to th e * * s h o u ld e x e r c i s e a n y pow er o r upon th e T r u s t e e s th e re a so u s fo r any by t h is p a r t ic u la r S e t t le e x e r c is e , o f any such pow er o r a n y s u c h d is c r e t io n o r th e m a t e r ia l . u p o n w h ic h such (2) e x e r c is e co n fe rre d or . A ny o th e r p ro p o sed e x e r c is e on th e T r u s te e s le g a l a d v ic e tru st . r e a s o n s s h a l l o r m ig h t h a v e o b t a in e d by by been b ased d ocum ent r e l a t i n g to th e o f an y pow er o r a n y d is c r e t io n t h is S e t t le m e n t th e T r u s t e e s at th e (n o t b e in g co st of th e e sta te ) AND / ................... ! j j ! 1 ’ i AMD XT i a E C P H K S S L Y P U O yiD E D t h a t t h e T E U 8 T X S S MAY P K aM IT AMY B e n e l i c i a r y p e r s o n a lly to in s p e c t any copy o l t h i s S e t t l e m e n t o r a n y d o c u m e n ts r e l a t i n g a t th e p r in c ip a l o f f ic a to th a T ru s t o l any o o rp o ra te T r u s ts * h e re o f h u t s h a l l n o t he bound to g iv e a n y lu r t h e r in lo r m a t lo n to any B e n e lic ia r y r e la t in g to th e a l l a l r s o l th e T r u s t or o permit a n y Beneficiary t o m ake a n y c o p i e s o l a n y d o c u m e n ts r e la t in g 15 , to th e T ro u t -­ T H IS S e t t l e m e n t i s Caym an I s l a n d s a n d t h e r i g h t s made u n d e r t h e l a v s o l th e o l a l l p a r t i e s an d th o c o n s t r u c t io n and e l l e c t o l e a c h and e v e r y p r o v is io n h e r e o l s h a l l be s u b je c t to tb e e x c lu s iv e j u r i s d ic t io n o l and c o n s t r u e d o n l y a c c o r d i n g t o t h e la w s o l t h e C a y m a n I s l a n d * w h ic h s h a l l b e t h e ’ T ru st lo r u m l o r t h e a d m i n i s t r a t i o n o l thto t •" • PROVIDED h o w e v e r t h a t t h e T r u s t e e s m ay I r o n t im e t o t im e d u r in g t h e A c c u m u l a t io n P e r i o d b y d e e d d e c l a r e T r u s t and t h e r i g h t s o l a l l p a r t ie s and th e c o n s t r u c t io n and e l l e c t o l t h e p r o v is io n s h e r e o l s h a l l I r o n su ch d e c la r a t io n be s u b je c t to th e e x c lu s iv e o l and c o n s tr u e d o n ly a c c o r d in g to th e ju r is d ic t io n o r m ore o l t h e T r u s t e e s t h e n s e r v i n g i n lo r ju r is d ic t io n i n w h ic h o n e o llic e is r e s id e n t th e a d m in is t r a t io n o l -t h is T r u s t s h a l l . t h e n c e lo r t h be s u c h o th e r j u r i s d i c t i o n t h a t t h e T r u s t e e s m ay n o t d e c l a r e r ig h t s o l a l l p a r t ie s th e d a te o l l a v s o l som e o t h e r ( o t h e r t h a n t h e C aym a n I s l a n d s ) a n d t h a t t h e lo r u m th a t t h is ’ H L 0 Y 10 £ 0 lu r t h e r t h a t t h i s T r u s t and th e an d th e c o n s t r u c t io n and e l l e c t o l th e p r o v is io n s h e r e o l s h a l l be s u b je c t t o th e j u r i s d i c t i o n o l and c o n s tr u e d a c c o r d in g to th e la v s o l a ju r is d ic t io n w h ic h / ............. w h ic h w o u ld c a u s e a m a t e r i a l c h a n g e I n th e r ig h t s o f th e B e n e f i c i a r i e s h e r e u n d e r o r w h ic h w o u ld n o t r e c o g n i s e v a lid it y r e s u lt in o f t h is T ru s t i f th e s u c h n o n - r e c o g n i t i o n w o u ld th e r e v o c a t io n o r t e r n in a t io n o f th e T r u s t 16 , A N Y p e r s o n o f f u l l u g e t o w h o a o r f o r w h o se b e n e f i t a n y c a p i t a l o r lu c o w e n a y b e l i a b l e tra n sfe rre d e x e r c is e o r 'in p a id o r a p p lie d by o r in t o b e a p p o in t e d c o n s e q u e n c e o f m> o f a n y pow er o r d i s c r e t i o n v e s t e d in th e T r u s t e e s a n y o t h e r p e r s o u may b y d e e d r e v o c a b l y o r i r r e v o c a b l y d is d a in h is I n t e r e s t a s a n o b j e c t o f s u c h p o w er o r d i s c r e t i o n e i t h e r w h o lly o r w it h r e s p e c t t o a n y s p e c i f i e d p a r t o r s h a r e o f s u c h c a p i t a l o r ln c o n o a n d t h e n s u c h p o w er o r d is c r e t io n s h a ll In t h iu ( d e s p i t e a n y t h i n g c o n t a i n e d e ls e w h e r e D ead) p ro ta u to c e a se to be e x e r c is a b le IN W IT N E S S w h e r e o f t h e s a i d Pa t a r A.Tamburo h a s s e t h i s h a n d a n d s e a l an d t h e Common S e a l o f G u in n e s s M ahon C a y m a n T r u s t L im it e d f ir s t h as been h e re u n to a f f ix e d above w r it t e n th e d ay and y e a r ' TH K F IR S T SC H E D U LE One H u n d r e d U n it e d S t a t e s D o l l a r s ( U .S .$ 1 0 0 .0 0 ) T H E SECO ND SC H E D U LE / Ja m e s D esm o n d T r a y n o r o f " K i l r o n a n ” , 1 3 4 , H o w th Road, C lo n t a r f , D u b lin 3, Ir e la n d ' . ( h e r e in a f t e r c a lle d " th e p r in c ip a l b e n e f ic ia r y " ) M a ry J o s e p h i n e T r a y n o r , b e in g th e w if e o f th e a 'f o r e s a id p r i n c i p a l b e n e f i c i a r y The is s u e o f th e p r in c ip a l b e n e f ic ia r y and h i s w if e ( o f w h a te v e ] d e g re e ) The g r a n d c h ild r e n o f th e p r i n c i p a l b e n e f i c ia r y w if e (o f w h a te v e r d e g re e ) in c lu d in g any le g a lly and h is a d o p te d c h ild r e n Any b r o t h e r s b e n e f ic ia r y or s is t e r s or h is w if e , o f e it h e r and t h e ir th e p r in c ip a l is s u e * S IG N E D S E A L E D AND D E L IV E R E D ) b y t h e a b o v e -n a m e d i n t h e ) presen ce o f . ) TH E COMMON S E A L OP G U IN N E S S MAHON CAYMAN T R U S T L IM IT E D HAS B EEN H EREUNTO A F F IX E D I I TH E P R E S E N C E O F : T in s DECLARATION OP TRUST is made the SlW day of _ V U m ______, I 9 9 X BY THE ORIGINAL TRUSTEE U WHEREAS ihe Scheduled Property has been transferred to the Original Tnutee to the intent that the Original Tnutee must hold it on the trusu declared in this Declaration of Tnist. NOW THIS DEED WITNESSES as follow s:1. In this Declaration of Trust, unless inconsistent with the context or subject matter or circumstances: . (1) "The Beneficiaries” means the persons specified in the First Schedule as amended from time to time in accordance with clause 2 and "Beneficiary" must be construed accordingly; (2) "The Original Trustee" means JOHN ANDREW FURZE of Ansbacher House, “George Tdwn, Grand Cayman, British West Indies. ’ (3) "The Perpetuity Date" means the day on which the shortest o f the following periods expires:(a) The period ending on the hundredth anniversary of the date o f this Trust; or (b) Tbe period of twenty (20) years from the death of the last survivor of all descendants male and female of King George Sixth of England living on the date of this Trust; or (c) The period ending on such date as the Trustee appoints by deed. (4) "Property" means assets of every description wherever situate and includes real personal intangible, movable or immovable property of every description and wherever situate and include investments, policies, cash and choses in action. (3) "The Protector” means JOHN ANTHONY COLLINS of Atubacher House, George Town, Grand Cayman, British West Indies, or any successor (whether an individual or body corporate) appointed in accordance with clause 23. (6) The Scheduled Property1*means the property set out in the Second Schedule; (7) "This Trust" means the trust declared by this Deed which will be known as the POINOANA Trust; (8)' "The Trust Fund" means:(a) The Scheduled Property, (b) Any further or additional Property which any person donates to or vests or causes to be vested in the Trustee to be held on the trusts and with and subject to tbe powers and provisions of this Trust, and (c) The Property for the time being and from time to time representing the Scheduled Property and the further or additional Property Of any) referred to in sub-paragraph (b), and all accumulations of income and capital from time to time; , (9) "The Trustee" means the Original Trustee or any other tnutee of this Trust for the time being ;nd from time to time; ira i ih J l h u lh itp w l 2. (10) Words of one gender include any other gender and singular words include the plural and vice versa. (11) "Person* includes a corporation. (12) A duly or obligation imposed is to be performed, and a power or discretion conferred is exercisable in each case, from time to time. (I) The Trustee DECLARES that it holds and will manage the Trust Fund on the 1rusts and with and si$ject to the powers and provisions set out in this Deed. All land must be held on trust for sale with power to postpone sale. (2) The Trustee may at any lime during the existence of this Trust accept any additional Property which any person donates to the Trust Fund either personally or by will. # (3) The Trustee may at any time by deed amend the First Schedule so as to add any person or class o f persons whatever now in existence or born before the Perpetuity Date as a Beneficiary, and that person or class of persons will for all purposes become a Beneficiary as of the date of the deed, or such later date as the deed specifies. (4) The Trustee may likewise at any time by deed amend the First Schedule so as to exclude any person or class of persons from being a Beneficiary as of the date of the deed, or from such other date subsequent to the date of the deed as is specified in it, but without prejudice to the Trustee's power to name that person or class of persons to be a Beneficiary at a future date. (I) The Trustee must hold all of the capital and income of the Trust Fund in trust for all or such one or more exclusively of the others or other of the Beneficiaries at such age or time or respective ages or limes if more than one in such shares and with such trusts for their respective benefit and such provisions for their respective advancement, maintenance and education at the Trustee's discretion as the Trustee by any deed revocable or irrevocable executed before the Perpetuity Dale appoints. (2) No appointment can be made or be revoked or be revocable oil or after the Perpetuity Date. (3) The Trustee for the time being may make or revoke any revocable appointment notwithstanding that the person who makes the appointment and revokes the appointment may not be tite same person. (I) In default of and subject to any appointment made under clause 3, the Trustee may until the Perpetuity Date pay or apply the whole or such part as the Trustee thinks fit of the income of the Trust Fund as it arises to or for the maintenance, education, advancement or benefit of all or any one or more of the Beneficiaries for the time being in existence in such proportions or manner as the Trustee in its discretion thinks fit. (2) Subject as set out In subclause (I), the Trustee must until the Perpetuity Date deal with die income of the Trust Fund or so much of it as is not paid or applied as set out in clauses 3 and 4(1), by accumulating it as an accretion to the capital of the Trust Fund. _ 3. 4. .. 5. In default and subject to clauses 3 and 4, the Trustee must hold all of the capital and income of the Trust Fund on trust for such of the Dcneficiaries os are in existence immediately before the Perpetuity Date, if more than one, in such shares as in its discretion it thinks fit or, if tltere is no such person, then on trust absolutely for any charitablc institution mentioned in the Third Schedule. 2 6. The Trustee may at its discretion al any time pay or apply the whole or any part of the Trust Fund to or for the maintenance, education, advancement or benefit of all or any one or more exclusively of the others or other of the Beneficiaries in such manner as the Trustee, in its discretion, thinks fit, without being Untile to account for the exercise of that discretion, including purchasing an annuity for any one or more of the Bcneficiaries. ' 7. Notwithstanding any of the trusts, powers and provisions in this Deed, the Trustee may at any time heforc the Perpetuity Dale by deed, revocable or irrevocable, release any power, right or discretion under this Trust. «. No benefit devolving on any Beneficiary under this Trust may form or constitute a portion of any communal or joint estate of that Beneficiary but that benefit will be and remain the sole, separate and exclusive property of that Beneficiary and, should any Beneficiary lie married and lie subject to laws of community property, then any benefit so devolving will be expressly excluded from the community and, in the case of the Beneficiary lieing female, that benefit will also be free from the interference, control or marital power of any husband of that Bcnefictary. In this clause, the won! "benefit" includes Property and the provisions of this clause apply not only to the benefits actually devolving on any Beneficiary but also to the Property for the time being representing it and the income of it. 9. In addition to the powers vested in tnistees by law, the Trustee without the consent of any Beneficiary has and may exercise the following powers:(1) To retain any Property belonging to or forming part of the Trust Fund in the actual state or condition in which the Trustee receives II for so long as the Trustee thinks proper without being answerable for any loss occasioned by ao retaining it. (2) To sell or otherwise dispose of all or any Property at any time forming part of the Trust Fund in such manner by public auction or private contract and for such price in money or other consideration and on such terms and conditions as die Trustee thinks proper and to receive the consideration or price on such terms and conditions as the Trustee thinks fit and give receipts for it. (3) To exercise all the voting powers attaching to any shares, stocks, debentures or other securities or notes at any time forming part of the Trust Fund. (4) To exchange Property for other Property of a like or different nature and for such consideration and on such terms and conditions as the Trustee considers advisable. (5) To compromise -and settle for such consideration and on such terms and conditions as the Trustee considers advisable all matters arising in relation to this Trust or the Trust Fund and all those compromises and settlements will be binding on all the Beneficiaries. (6) To surrender and deliver up any securities or notes or other Property forming part o f the Trust Fund, for such consideration and on such terms and conditions as the Trustee approves, to any company or corporation reducing its capital and the Trustee may receive that consideration in the form of cash, securities or other assets as is agreed between the Trustee and (hat other company or corporation. ‘ (7) To consent to any re-organisation or reconstruction of any company or corporation whose shares, indebtedness, notes or securities form part of the Trust Fund and to consent to any reduction of capital or other dealings with those shares, securities, or other Property as die Trustee considers advantageous or desirable. ' . (8) tnntfeilM m .dhte.yw 4 To invest or deal with any money forming part of the Trust Fund without regard to Uie provisions of any statute regulating trusts in any Property or business whatever (including but nol limited to the purchase of any freehold or leasehold 3 ~ land with or without any house or other buildings on it or goods for the beneficial occupation, use or enjoyment of any Dcneficiary) on such personal credit with or without security and with or without interest as the Trustee in its discretion thinks fit, to the intent that the Trustee will have the same full and unrestricted power of dealing with and investing and varying investments and IVopcrty in all respects as a beneficial owner. (9) ' To make speculative investments if it thinks advisable without limitation by any "prudent man rule" or rule of reasonableness or any other statute or rule of law regarding investments by trustees and the making of those investments must not in any event be constroed as a breach of trust; and to open accounts, margin or otherwise, with brokerage firms, hanks or others wherever In the world, to invest the funds of ihe Tmst Fund in, and to conduct, maintain and operate those accounts directly or through an agent for the purchase, sale and exchange of, commodities, stocks, bonds, notes and other securities and In connection with so doing, to barrow or raise money, incur obligations, obtain and give guarantees and engage in all other activities necessary for or incidental to conducting, maintaining and operating those accounts. » . (10) To pay out of the income or capital of the Trust Fund all the costs of and incidental to Ihe preparation execution and stamping of this Trust. - (11) To determine whether any sums received or disbursed are on account of capital or Income or partly on account of one and partly on account of the other and in whnt proportions, and Ih e decisions of Ihe Trustee, whether made in writing or implied from its acts will he conclusive and binding on all Beneficiaries. (12) Tb carry on any trade or business anywhere in the world whether alone or in partnership whether limited or general. (13) To lend Ihe whole or any part of the Trust Fund to any Beneficiary or any company referred to in subclause (20) of this dause or any partnership referred to in subclause (12) of this clause and to appropriate and apply it or the income of it in securing (by any means however) any obligation of that Beneficiary, company, or partnership, or in guaranteeing or hccnming surety for him on such terms as to repayment or otherwise and whether interest free or at interest and with or without security as the Trustee thinks Hi. (14) To be employed and remunerated or otherwise profit as a director or other officer or employee or as agent or adviser or otherwise however of any company or other corporation or undertaking or firm whatever at any time or in any way connected or dealing with the Trust Fund or in which tho Trustee is in any way interested, or dealing with or acquiring any Property from or selling or letting any Property to liie Tnutcc and to retain as its absolute property (and without being liable to account for it) any remuneration, fees or profits received by it in any such capacity notwithstanding that its appointment or office as that director, officer, employee, agent or adviser has been obtained or is held or retained in right or by means of its position as the Trustee or one of the Trustees. (15) To enter into any indemnity in favour of any former trustee or other person in respect of any contingent or prospective liability (including any tax, duty or other fiscal imposition) in respect of the Trust Fund or the income of it or otherwise in connection with this Trust and to apply the whole or any part of the Trust Fund or the income of it by way of mortgage, pledge or otherwise however as security for that indemnity. (16) (a) _ ~ ....) ^ " • } , To employ and pay for such professional or other assistance as the Trustee thinks necessary in the discharge of its duties, including but not limited to lawyers, accountants, agents, advisers, managers and employees of any kind. (b) To act on the opinion or advice of or information obtained from any financial adviser, lawyer, valuer, surveyor, broker, auctioneer, accountant or otlier expert or professional person, but so that the Trustee will not be responsible for any loss, depreciation or damage occasioned by acting or not acting in accordancc with that opinion, advice, or information. (17) To determine all questions and matters of doubt which may arise in the course of the management, administration, realisation, liquidation, partition or winding up of the Trust Fund. (18) To erect buildings on and make improvements to any Property forming part of the Trust Fund and also to conduct farming operations on and lease all or any part or that Property. (19) To institute and defend legal proceedings and lo proceed lo the final end and determination of them or compromise them as the Trustee considers advisable. (20) To incorporate or acquire the shares of any company in any place In the world at the expense of the Trust Fund with limited or unlimited liability Tor the purpose of, among other things, acquiring or holding Ihe' whole or any part of the Trust Fund; and the consideration on the sale of the Trust Fund or any part of it to any company incorporated or acquired pursuant to this subclause may consist wholly or parity of fully paid shares or debentures or debenture stock or other securities or notes of the company and may be credited as fully paid and may be allotted lo or otherwise vested in the Trustee and will be capital money in the Trustee’s hands. (21) To exercise or concur in exercising the voting and other rights attaching to any shares or securities for die time being forming part of the Trust Fund so as to become a director or other officer or employee of any company or other entity and to be entitled to vote and to lie paid and to retain for the Trustee’s use and benefit reasonable remuneration for those services. (22) To raise or borrow money on the security of the Trust Fund or any part of it at any time and pay or apply the money so borrowed or raised in any manner which money forming part of the capital of the Trust Fund may be paid or applied and to execute and deliver such security documentation for loans or indebtedness or other obligations as is required; and to give guarantees and indemnities and by any means to secure liability under them on the Trust Fund or any part of it. (23) To deposit the securities, title deeds and other documents belonging or relating to this Trust for safe custody with any bank or trust company (including Itself). (24) To hold any part of the Trust Fund in the name of any nominee of the Trustee. (25) If income or capital becomes distributable to a minor Beneficiary or to a Beneficiary under other legal disability or to a Beneficiary not adjudicated incompetent but who, because of illness or mental or physical disability, is in the Trustee's opinion unable properly to administer that distribution, then the Trustee may pay that distribution in any one or more of Ihe following ways as it thinks best:- . (a) directly to that Beneficiary; (b) to ihe legally appointed guardian or committee of lhal Beneficiary; (c) to a parent or some relative or friend for the carc and support and education of that Beneficiary; or (d) ‘ by the Trustee applying those amounts directly for the benefit of that Beneficiary; ami as regards (b) and (cl. without having to sec to the application of them and the receipt of any such person will constitute a Tull and final release and discharge of the Trustee. (26) If any incninc, prohale, estate or other duty, fee or tax becomes payable in the Cayman Islands or elsewhere in rcspcct of the Trust Fund or any part of it on the death of any Nenefidary or otherwise, to pay al its discretion (but in tlte interest of tlic ncncficinrics ami the Trust Pund) all or any part of that duly; fee or lax out of the Trust Pund will) or without recourse against any Rencficiary or to refuse to pay it or any pai\ of it unless indemnified, and to determine the time and manner of the payment (if any). (27) Generally in relation to the Trust Pund to perform all acts of alienation, hypothecation and other acts of ownership to the same extent and with the same effect as Ibe Trustee might have done if it had been the bcneflcial owner and the Trustee’s decision and action, whether actually made or taken in writing or implied from the Trustee's acts, will be conclusive and binding on alt the Beneficiaries. 10. -Notwithstanding any of the trusts, powers and provisions in this Deed, the Trustee may at any time before the Perpetuity Date at its discretion by any irrevocable deed, appoint that the whole or any part of Hie Trust Fund must subsequently be held on (lie trusts and with and subject to the powers and provisions of any other trust (including this present provision) not infringing the rule against perpetuities applicable to this Trust and approved by ilic Trustee and in favour or for the benefit of all or any one nr more exclusively of tlte other or others of the Beneficiaries. If it makes any such appointment, tl»c Trustee may transfer to the trustee of that other trust the Property comprised in the appointment and then the trusts declared in this Deed concerning that Property will end and that Property will for all purposes be subject to the trusts powers and provisions in that other trust and be subject la and governed by the proper law of that other trust whether or not that proper law is the proper law of this Trust. 11. Notwithstanding any of the trusts, powers and provisions in this Deed, the Trustee may al any time before tlte Perpetuity Date by any irrevocable deed retire us Trustee and with tlte Protector's written approval appoint a new trustee outside the Cayman Islands as Trustee of this Trust On that appointment being made, the Trustee must immediately hold the Trust Pund on trust for the new trustee and must transfer it In the new trustee as soon as possible. Subsequently, the rights of all persons and the construction and efTcct of every provision of this Trust will he subject to the exclusive jurisdiction of and be construed only according to the law of the country of residence or incorporation of the new trustee which will bccome the forum for the administration of this Tmst unless any law, including any rule against perpetuities under that law, would lie infringed by the provisions of this Deed, in which event, although the forum for the administration of this Trust wilt have changed the laws of tlte Cayman Islands will continue to apply as provided by clause 22. If the Trustee exercises its power under this clause, clauses 17 and 22 will take effect and be subject to the provisions of this clause AND the new trustee may by deed make such amendments to this Deed as are ncccssary to ensure that it is effective and legal in that new jurisdiction. 12. The Trustee must keep accurate accounts of its trusteeship and may have them audited annually al the Trust's expense as the Trustee determines, by an accountant or firm of accountants which the Trustee selects. 13. Tlte customary expenses in connection with the administration of this Trust including the Trustee’s remuneration and charges and of the investment of any part of the Trust Pund and the collection of income anil other sums derivable from it must be charged in tlte first instance against the incomc of the Trust Pund BUT if that is insufficient then against capital. 14. The Trustee may, in its discretion appropriate any part of the Trust Fund in Us actual stale or condition of investment at the time of appropriation in or towards satisfaction of any interest of any person in the Trust Fund as seems just and reasonable lo the Trustee. 15. (1) Any Trustee being a trust company or corporation is entitled to charge and be paid oul or the Trust Fund remuneration in accordance with its scale of fees in force from time to time and may, as may its parent company or any subsidiary or any company in which its parent company is a shareholder, without accounting for any resultant profit, act as banker to and accept deposits from and perform any service for the Trust Fund on the same terms as it would make with any other customer. (2) Any Trustee being a lawyer, chartered accountant or other person engaged in any profession or husincss will he entitled to charge and be paid alt usual professional and other charges for business transacted, time spent and acts done by him or any partner of his in conncction with this Trust, including acts which a Trustee not being in any profession or business could have done personally. (3) Any Trustee may on behalf of this Trust contract or deal with any person firm or body corporate with whom it is interested in any way whatever, directly or indirectly, without the Trustee or that person, firm or body corporate having to account for any resulting profit. — 16. The Tnutec need not give bond or security for the administration of the Trust Fund or for the discharge of its duties arising under this Trust. 17. (1) If there is a Protector, (lie power of appointing a new trustee of this Trust will be vested in the Protector, but if there is no Protector, or failing an appointment by the Protector within fourteen days of a written request from the Trustee lo do so, that power will be vested in the Trustee or the personal representatives or the liquidator of the lost surviving Trustee, and that power will extend to the ’appointment of a new trustee in the place of any Trustee resigning its trusteeship and also to the appointment of additional trustees up to any number subject to such limit (if any) as is imposed by law. (2) Any Trustee may at any lime resign the' trusteeship on giving not len than fourteen (14) days' notice addressed lo the other trustees (if any) or, if there are no other trustees, if a new trustee is appointed in the place of the retiring Trustee, and the notice of resignation will be taken to operate so as to vest all of the Property forming the Trust Fund in the continuing Trustee or- the new trustee (as the case may he). (3) The office of a Trustee will Ipso facto end if that trustee, beiug an individual, is found lo lie a lunatic or of unsound mind or if he becomes subject to any bankruptcy laws or, if that Trustee, being a company, enters into liquidation whether compulsory or voluntary (not being merely a voluntary liquidation for the purposes of amalgamation or reconstruction). . (4) Notices of all changes in the trusteeship must be endorsed on or attached to this Deed signed by the surviving or continuing Trustee, if any, and every notice will be sufficient evidence to any person having dealings with this Trust as to the facts to which it relates, and all notices of changcs in the office of Protector must be dealt with and will with the necessary changes be evidenced in like manner. (5) Any person dealing with this Trust may rely on a copy of this Deed and of the notices endorsed on it or altadted to it, certified by the Trustee or the Trustee's lawyer before a Notary Public, to the same extent as it might rely on the original. (6) Unless there arc fewer than three trustees of this Trust, the Trustee may act by majority vote. 18. (1) • (2) No Trustee (notwithstanding tKat it is a professional tnittce) will be liable for any error of judgment or mistake of law or other mistake or for anything EXCEPT the wilful misconduct or wilful breach of trust by that Trustee and except as set out in this sub-clause each Trustee and the directors, officers and employees of any corporate trustee will have no liability whatever for and must be indemnified by the Trust Fund against any claims, losses, death duties, taxes and impositions arising in connection with the Trust Fund or any part of it. (1) The Trustee may al any lime on such terms as it thinks fit, whether for a fixed period af time or subject lo a fixed period of notice or otherwise, and either in jelnlion lo the whole of the Trust Fund or to any part of it as may for the lime "being lie Invested in any particular country or group of countries, act as . investment adviser or investment or portfolio manager or employ any person, firm, or company (including without prejudice to the generality of the provisions ' of this sub-clause any company being the parent company or a subsidiary company of the Trustee nr any company under common control wilh or otherwise associated wilh Hie Trustee or any company in which the Trustee is in any way interested) as an investment adviser or investment or portfolio manager. (2) The Trustee may give an investment or portfolio manager power to operate a discretionary account. The Trustee may employ an investment or portfolio manager on terms lhal it may sell investments to and purchase investments from the Trust Fund, pool trust funds with those of itself and other customers, and nggregale tlie Trust Fund's transactions with those of itself and other customers so as to average the cost of sales and purchases over a period. (3) Tlie Trustee may pay an investment adviser or investment or portfolio manager such fees, commission or other remuneration and such compensation for expenses as the Trustee in ils discretion thinks fit, and the investment adviser or investment or portfolio manager will be entitled io retain for ils own use and benefit any commissions or share of commissions customarily or by usage payable to it in relation lo any dealing or transaction wilh or concerning Hie Trust Fund or any part of it; AND if Ihe Trustee or any parent, subsidiary or associated or other company mentioned in Ibis clause acts as investment adviser or investment or portfolio manager, it is entitled to remuneration and commission and generally to act in accordance wilh ils published terms and conditions in force from time to time for acting in lhal capacity. ' 19. - ' (4) 20. F.very discretion or power conferral on the Prolcctor by this Deal will be an absolute ami uncontrolled discretion or power, ami every discretion or power conferral on the Trustee by this Deal or by law will, unless otherwise expressly staled to lie subjeet lo tlie consent nr control ol' the Prolcctor, he an absolute ami uncontrolled discretion or power, ami 110 Trustee will be held liable for any loss or damage accruing as a result of (be Trustee's concurring or refusing or railing lo concur in an exercise of any discretion or power awl, during any period that tliure is no Prolcctor, every discretion or power of the Trustee will lie an absolute and uncontrolled discretion or power. . No Trustee will incur any liability or be in any way responsible for any loss which may be incurred as a result of negligence of Ihe investment adviser or portfolio manager or anything done or not done as a result of any dealings o f or advice or recommendations given or purporting lo have been given by an inveslmenl adviser or investment or portfolio manager (whether in writing or by ^cablegram or orally or by telephone or otlierwise) or for any omission lo take any action in Ihe absence or through nonreceipt of that advice or those recommendations from ihe investment adviser or investment or portfolio manager and so that, in particular hut without prejudice lo the generality of ihe provisions of this sub-clause, no Trustee wilt be liable for any failure to diversify the investment of the Trust Fund or any part of it. Tlie Trustee need not interfere with or take any active part in the management or conduct of the business of any company wherever resident or incorporated in which Ihe Trust is , interested although holding the whole or a majority of the shares carrying the control of the company, and so long as the Trustee has not notice of any aa of dishonesty or misappropriation of money on the part of the directors or employees having the management of the company the Trustee may leave the conduct of its business (including the payment or non-payment of dividends) wholly to those directors or employees; and no Beneficiary under this Trust will be entitled to require the distribution of any dividend by any company wherever incorporated or resident in which tin Trust may be interested or require the Trustee to exercise any powers he may have compelling any such distribution. ‘ t) 21. Every Trustee or Protector who is a tx&ly corporate may exercise or concur in exercising any discretion or power conferred on it by a resolution of that body corporate or by a resolution of its board of director* or governing body or may delegate the right and power to exercise or concur in exercising any such discretion or power to any one or more of its directors, officers or employees. 2Z This Trust is established under the laws of the Cayman Islands and, if and so long is the powers in clause 11 have not been exercised, the rights of all parties and the construction and effect of every provision of this Trust is governed by and construed only according to the laws of the Cayman Islands, which is the forum for the administration of this Trust 23. (1) th e Protector will automatically cease to be the Protector, if bring an individual, he or she dies or is found to be a lunatic or of unsound mind or becomes subject to any bankruptcy laws, or if that Protector, being a company, enters into liquidation whether compulsory or voluntary (not being merely a voluntary liquidation for the purposes of amalgamation or reconstruction) or in either case if that Protector makes a valid appointment under sub-clause (2), or resigns. (2) The Protector may be deed and, if an individual, may also by will irrevocably appoint any other person to be Protector of this Trust in his pisee. On the Trustee being given written notice of the appointment and on the person appointed ' consenting in writing to act, that person- will become the Protector, immediately if appointed by deed, or on the death of the testator if appointed by Will. (3) If notwithstanding the provisions of sub-clause (2), there is at any time no Protector of this Trust, the Trustee may by deed irrevocably appoint any person not being a Trustee to be the Protector. - 24. ; A Beneficiary of this Trust may not alienate, encumber or hypothecate his interest in it, nor will the interest of any Beneficiary by subject to claims of his creditors or be liable to attachment, execution or other process of law. A Beneficiary may not pledge, assign, transfer, sell or in any manner whatever accelerate, anticipate or encumber Ute income or capital of the Trust rand, nor will any income or capital of the Trust Fund be in any manner subject or liable in the Trustee’s hands for the debts, contracts or liabilities of any Beneficiary or be subject to any assignment or any other voluntary or involuntary " ‘ or dispoi “ isition whatever before the Trustee distributes dl or part of that income alienation or capital to the Beneficiary FIRST SCHEDULE 1. Jama Desmond Traynor, of 134, Howth Road, DUBLIN 3, Ireland and his wife Dofeen Traynor; 2. Any child or grandchild of the said James Desmond Traynor and Dofeen Traynor. ' SBOONT) 8CHKM1LB The total issued equity and loan capital of the following companies incorporated under the laws of the Cayman blonds, British West Indles:POINCIANA FUND LIMITED HAMILTON ROSS CO. LIMITED WORLDWIDE MANAGEMENT & CONSULTANCY SERVICES LIMITED DUMAS'HOLDINGS LIMITED in u lfr iM m clH rp rm 9 THE INTERNATIONAL RED CROSS, Geneva, Switzerland or any other charity which the Trustee sclccts. EXECUTED under Seal by __ in the T m u i fc. presence of:- inmfcWmftofnl 10 IliiVnimlVHVI 1 M jgftWiL-. t n v p i s & a mmm f r n t m V h m m m r M fO il-3S3t-*7«-J034 luspapotf? i4DNMte,i$n lAFud MbtUMMtlflMlBMk OtfbHn* fedHd A b k RflMSlfldBOod Would you ptem BtiB K>triagntphlctByremitS tf. £125.000.00to: Royal Bttk ofScodaad ft — *- — - m m,rnt koto o w e iiOMCi 71 Bob Sma^SL tid ier Jeneyi Ounad U ttds Son Code 16-10-21 Swift Gods: 16-50-06 feravdkto 11151833 AccountMMK AIBtek(CLL)Lid. gtob — awe J. O. Twyaor 74519100 Rtffe? CJ.U. FIbiib 4hMt obctooosBtM ritarttbO lM M l 201035 Q u « « n « > y . Mow . fc ita W n * . W it Utn. O iD m n u t» * > . » * » V > > I f * Appendix XV (128) Mr Joseph Turley 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Joseph Turley. a) Internal GMI memo of 4 September 1989 - JB to CC. b) Internal GMI memo of 28 September 1989 - Credit Control Unit to Credit Committee, Guinness Mahon and Co. c) Letter of 9 January 1990 - Ansbacher Limited to GMI. Correspondence received from or on behalf of Mr Joseoh Turley. a) Letter of 21 December 2001 - Arthur Cox Solicitor to Inspectors. n •. JO S E P H TORLBY / ARGUS A P T O M O P T M B S T .T H T T S D / GBM P IA 3 T IC 3 i B ack g ro u n d Me. J o s e p h T u r l e y i s t h e p r o p r i e t o r o f A r g u s A u t o m o b ile s L i m i t e d , a c a r r e n t a l com pany w h ic h o p e r a t e s fro m p r e m is e s i n T e re n u re . M r. T u r l e y h a s b e a n a c u s to m e r o f G&M f o r t h e p a s t t e n y e a r s and b o t h A r g u s and M r. T u r l e y h a v e a v a i l e d o f a num ber o f d i f f e r e n t f a c i l i t i e s o v e r t h i s p e r io d . T h e se f a c i l i t i e s , w h ic h h a v e am ounted t o a maximum a t a n y one t im e o f X R £ 6 0 0 ,0 0 0 w e re p r o v id e d a n t h e b a s i s t h a t s e c u r i t y w as a d e q u a t e ( t o t h e e x te n t o f S t g .£ lm .) D ue t o t h e B a n k 's c h a n g in g r e l a t i o n s h i p w it h t h e o f f s h o r e c o n n e c t io n s an d i n p a r t i c u l a r w it h t h e d e p a r t u r e o f P a d r a ig C o l l e r y fro m G&M, i t h a s b e e n a g re e d w it h M r. T u r l e y t h a t o u r f a c i l i t i e s w it h h im /A rg u s/G B M s h o u ld now b e f o r m a lis e d w it h o u t re g a rd t o t h e a d e q u a te s e c u r it y . I t i s p r o p o s e d t h a t G6M s h o u ld t a k e s e c u r i t y o v e r a num ber o f in v e s t m e n t p r o p e r t i e s owned b y H r. T u r le y . O u r e x i s t i n g a p p ro v e d f a c i l i t i e s a r e s e t o u t b e lo w :P re se n t F a c ilit ie s • L im it J . T u r le y A r g u s A u t o m o b ile s J . T u r le y ( J n r .) GBM ( P l e s t i e s ) L t d . B e la n e a 1 0 0 ,0 0 0 I S O , 000 ' Loan » .X . 3 2 ,3 6 2 1 0 ,0 0 0 1 3 0 ,0 0 0 20,000 1 3 0 ,0 0 0 2 8 0 ,0 0 0 - y T h e f o l l o w i n g n o t e c o n s id e r s t h e f a c i l i t i e s t o J . T u r l e y 3 n r . end A r g u s . A s e p a r a t a n o t e i s a t t a c h e d on GBM P l a s t i c s and J . T u r le y j n r . Jo s e p h T u r le v ^ ............ . T h i s l o a n r e p r e s e n t s a p e r s o n a l lo a n t o M r. T u r l e y w h ic h h a s b e e n a v a i l a b l e f o r a num ber o f y e a r s . M r. T u r l e y u s e d i t t o f in a n c e p a r t o f th e p u rc h a se c o s t o f t h r e e w a r e h o u s e s lo c a t e d I n S a n t r y . I t I s r e p a id fro m p a r t o f t h e r e n t a l Incom e r e c e iv e d on t h e s e p r o p e r t i e s ( a n n u a l r e n t a l In co m e i s £ 6 0 , 0 0 0 ) . M r. T u r l e y h a s r e q u e s t e d , h o w e v e r , t h a t t h e f a c i l i t y be c o n t in u e d a t i t s p r e s e n t l i m i t o f £ 1 0 0 ,0 0 0 . A r g u s A u t o m o b ile s We a p p ro v e d a w o rk in g c a p i t a l f a c i l i t y o f £ 1 5 0 , 0 0 0 I n Jan u a ry. T h i s was e s s e n t i a l l y a s t a n d b y f a c i l i t y t o b e d ra w n down I n t h e e v e n t t h a t t h e c o m p a n y 's f a c i l i t i e s from i t ' s C l e a r i n g B an k - AXB w ere f u l l y u t i l i s e d - i n t h e e v e n t AXB a llo w e d a n e x c e s s and a s a r e s u l t t h i s f a c i l i t y I s a o lo n g e r r e q u ir e d . ..«/... F i n a n c i a l I n f o r m a t i o n o n A r g u s i s a t t a c h e d a n d sh o w s a p r o f i t b e f o r e t a x o f £ 1 5 9 , 0 0 0 f o r t h e y e a r t o 3 1 . 3 . 8 9 co m p a re d t o £ 1 2 9 ,0 0 0 i n t h e p r e v io u s y e a r . N e t A s s e t s a t 3 1 . 3 . 8 9 am o u n ted t o £ 5 0 8 ,0 0 0 '. T h e co m p an y o p e r a t e s fro m p r e m is e s owned b y M r. T u r l e y t h u s t h e n e t w o r t h d o e s n o t i n c l u d e a n y v a l u e f o r p r e m is e s . A rg u s L e a s in g L im it e d T h e a b o v e co m p an y h a s b e e n e s t a b l i s h e d b y A r g u s A u t o m o b ile s t o e n a b le i t i n c r e a s e i t s r a n g e o f s e r v i c e s w h i l s t i t i s in t e n d e d t h a t t h e co m p an y w i l l b e p r i m a r i l y p r o v i d i n g a l e a s e b r o k e r i n g s e r v i c e , i t i s in t e n d e d t o b u i l d u p g r a d u a l l y a le a s e b o o k f le e t . T h e i n i t i a l b o r r o w in g r e q u ir e m e n t i s £ 2 0 0 , 0 0 0 . T h i s w i l l m ean t h a t o u r e f f e c t i v e f a c i l i t i e s t o J o e T u r l e y S n r . w i l l am o u n t t o £ 3 0 0 ,0 0 0 w h i l s t a s t h e a t t a c h e d n o t e o n GBM show s f a c i l i t i e s t o J o e T u r l e y J n r /G B M am o unt t o £ 2 0 0 , 0 0 0 . T h e se f a c i l i t i e s a r e g u a r a n t e e d b y J d e T u r l e y S n r . w it h t h e g u a r a n t e e b e in g s u p p o r t e d b y M o rtg a g e o v e r p r o p e r t i e s i n S a n t r y w h ic h h a v e a v a lu e o f £ 5 5 0 ,0 0 0 . T h u s w h i l s t t o t a l f a c i l i t i e s am o un t t o o f £ 5 5 0 ,0 0 0 j u s t o v e r o n e t im e s c o v e r , g r e a t e r ( 1 . 8 t im e s ) a s t h e n o t e o n GBM £ 1 3 0 , 0 0 0 i s c o v e r e d m o re t h a n t w ic e b y d is c o u n t b a s i s o f 5 0 % . . £ 5 0 0 ,0 0 0 a g a i n s t s e c u r i t y th e co v e r I s e f f e c t iv e ly show s t h a t i t s l o a n o f D e b to rs and s t o c k s on a M Summ ary ■ M r. T u r l e y o p e r a t e s a b u s i n e s s w h ic h h a s b e e n c o n s i s t e n t l y r o f lt a b le . i n e s t a b l i s h i n g t h e l e a s i n g b u s i n e s s , M r. T u r l e y a s e m p lo y e d a f o r m e r s e n i o r e m p lo y e e o f F i a t I r e l a n d who h a s b e e n i n v o l v e d i n t h e c a r b u s i n e s s f o r a nu m b er o f y e a r s . M r. T u r l e y w i l l d e v e lo p t h e l e a s i n g b u s i n e s s on a g r a d u a l b a s i s an d w i l l n o t b e co m e i n v o l v e d i n c o m p e t it io n w it h t h e l a r g e p l a y e r s i n t h i s m a r k e t . Wood C h e s t e r e t c . S We h a v e h a d a lo n g a n d s u c c e s s f u l r e l a t i o n s h i p w it h M r. T u r l e y and recom m end t h a t we p r o v id e t h e new f a c i l i t y t o A r g u s L e a s i n g an d e x t e n d t h e p e r s o n a l l o a n f a c i l i t y o f £ 1 0 0 , 0 0 0 . we a r e e a r n i n g B LR p l u s 1 % o n M r. T u r l e y ' s l o a n (RO C o f 4 0 % ) . T h i s f a c i l i t y w i l l c o n t in u e t o b e s u b j e c t t o a n n u a l r e v i e w , we w o u ld p r o p o s e t o c h a r g e 2 % o v e r t h e c o s t o f f u n d s o n t h e l o a n t o A r g u s L e a s i n g (ROC o f 1 6 % ) . uh {ion-r9108 t?k? anneal Insignnd.tow6il" Juice 4.3.39 tn Iona to b- rip! II locuxitvl.to bu 1d ova: lav-n yours. M K M O R A M D U t t I GOXHNBSS MAHON 6 CO TO : C r e d i t C o a m it t a e DATE: FROM: M ic h a e l W h it m a r s h C r e d it C o n tr o l U n it J ^ S L M X o B i i c n o w - cat c c b u m A t t a c h e d a r e a p p l i c a t i o n s t o C r e d i t C o m m itte e a p p ro v e d b y D u b l i n t o f i r s t l y g r a n t a n « v f a c i l i t y t o A r g u s L e a s i n g Jdm itm A, a new co m p an y fo rm e d b y M r T u r l e y a n d , s e c o n d ly , r e a r r a n g e t h a s a o u r i t y o n t h a w h o le c o n n e c t io n . - f , N T O 28 S e p te m b e r 1 9 8 9 C ' % T h a p r a s a n t l i m i t s t o t h a C ro u p a r e s a t o u t on p a g e l o f a c c o m p a n y in g m em oranda a n d t o t a l a n e x p o s u r e o f £ 4 5 0 ', 0 0 0 t h e s e a r e c u r r e n t l y s e c u r e d b y " a d e q u a t e " d e p o s i t s w h ic h e f f e c t iv e ly u n d e r D u b lin 's c o n t r o l. th a and are S h e C o m m itte e w i l l b e a w a re o f t h e b a c k g r o u n d o f s u c h s e c u r i t y a n d t h e f a c t t h a t , i n c e r t a i n c a s e s , t h i s s a y b a w it h d r a w n i n t h e f o r e s e e a b le f u t u r e . T h i s i s o n e s u c h c a s e w h e re t h a . c u s t o m e r h a s b e a n in f o r m e d t h a t t h e B a n k w o u ld p r e f e r t o h a v e s u c h a r r a n g e m e n t s c o n d u c t e d e ls e w h e r e , u n l e s s a d d i t i o n a l s e c u r i t y c o u l d b e p r o v id e d . r f /" n ' . . . M r T u r l e y w is h e s t o m a i n t a i n h i s r e l a t i o n s h i p w it h G U I a & d h a s o ffe r e d a d d it io n a l o r s u b s t it u t e s e c u r it y t o b ad e h i s p e r s o n a l g u a ra n te e . T h is i s a c h a rg e o v e r t h r e e m odem w are h o u se u n i t s w h ic h h e ow ns p e r s o n a l l y , s i t u a t e d n e a r D u b l in a i r p o r t . Th e se a r e c u r r e n t ly t e n a n te d b y A v is , V a lle y Ic e -c r e a m ( t h e b ig g e s t i c e - c r e a n d i s t r i b u t i o n i n I r e l a n d ) .a n d t h e t h i r d b y a n e q u a l l y r e p u t a b le c o v e n a n t. A d d i t i o n a l l y , D u b l in a r e o f f e r e d a ' f i r s t f l o a t i n g c h a r g e o v e r t h a a s s e t s o f GBM P l a s t i c s L i m it e d t o s e c u r e t h a t c o m p a n y 's b o r r o w in g . T h e p r o p e r t y h a s b e e n in f o r m a lly v a lu e d b y J o h n F in n e g a n o f F in n e g a n M en to n a t £ 5 5 0 ,0 0 0 . D u b lin h a v e n o t i n s i s t e d o n a fo rm a l v a lu a t io n a t t h i s sta g e a s th e y f e e l t h a t i t i s d i f f i c u l t t o a s k t h a c u s t o m e r (who w a n ts t o s t a y w it h them ) t o g o t o t h i s e x p e n s e when h a h a d q u i t e r e a d i l y p r o d u c e d a l t e r n a t i v e s e c u r i t y a n d t h e y a r e s t i l l h o l d t h e a d e q u a c y w h ic h i s c u r r e n t l y v a l u e d a t ab out £ 1 m illio n . . n W hat v e h a v e t h e r e f o r e a t t h e moment i s a d d i t i o n a l s e c u r i t y o n w h ic h a l l t h e f o r m a l i t i e s h a v e n o t b e e n c o m p le t e d , b u t i t d o e s f u l f i l l D u b l i n ' s r e q u ir e m e n t o f r e l y i n g l e s s o n t h a a d e q u a c y w h ic h n a y w e l l b e re m o ve d i n d u e c o u r s e . When t h i s d o e s h a p p e n th e y w i l l r e q u ir e a fo rm a l v a lu a t io n o f th e p r o p e r ty . A M tn b er o f th t H tn rj A ru bachtr H ald ln g i P IC M trch an r B u ttin g C roup 42 Fitzwilliam Square, Dublin 2. T e l: Fax: 7 6 5 1 4 4 /7 6 3 0 6 5 6 12 0 3 5 P .O . B o x 0 8 7 . O m n d C a r m a n , B r itta h W o t I n d i a P h o n e ( 8 0 9 ) 9 4 9 - 4 6 5 J /4 T d ac C M 30S Puci (809) 949-7946 (809) 949.5267 9th January, 1990 M. Lanigan-0 'Keeffe, Esq., Managing Director, Guinness I Mahon Limited, 17 College Green, DUBLIN 2. Dear Martin, Could you please arrange to let me have a note of the balances, after application of interest on 31/12/89, for the following Accounts: g .b .m . Plastics ’ ifc* •J. Turley ??fs LoM Y o u r s s in o s r e ly , J.D. Traynor i A R T H U R C O X Earlsfort C hntrk ,Earlsfort T frraci-:,D ublin 2 T hi.+353 1 618 0000 Fax +353 1 618 0618 Dx 27 D ublin www.arthurcox.com ail^artkurcox.com B Lo elfast STOKES HOUSE, 17-25COLLEGE Sgi'AKi:l:.\ST ISELEAsTliTt61ID Telephone +44 289023 0007 Fax +44 289023 34b4 N ndon 2 9 L id o a t e H im L o n d o n E C 4 M 7JE T elepho ne ew Y ork 5 7 0 L e x in g t o n A v e n u e , 2 8 t h F lo o r . N e w Yo r k , N Y 1 0 0 2 2 T + 4 4 20 7213 0450 elepho ne + 1 212 7 59 0808 Fax + 1 2 1 2 6 8 8 3 2 3 7 Fa x + 4 4 2 0 7 2 1 3 0 4 5 5 YOt'RWI-I-’GRJINOH C/TOP/NS/PM GG/nm Direct Dial : 618 0470 21st December 2001 The Office of the Inspectors, Ansbacher (Cayman) Limited, Third Floor, Trident House, Blackrock, Co. Dublin. Re : * A ,r »- e A Ii - t v Our Client: Joseph Turley Inspectors Preliminary Conclusions dated 11th December 2001 Dear Sirs, Our client has forwarded to us your letter of the 11th December 2001 which encloses your preliminary conclusions which consists of five numbered paragraphs. The content of same has greatly upset our client. Considering that it is now over a year and a half since he last appeared before the Inspectors during which time eleven additional binders were furnished to you on the 16thday of August, 2000 you have requested no further information nor have you raised any queries concerning his evidence. ’ Correspondence February 2000 By letter dated 7th February 2000 you asked our client five questions and our client responded in writing on the 18th February 2000. The questions were as follows Question: (a) When did you cease to be a client of College Trustees ? Answer: (A) I am not aware that I was personally ever a client of College Trustees. I am and have for many years been a client of Messrs. Guinness & Mahon (Ireland) Limited. Question: (b) Did you, or any person on your behalf establish, or were you directly or indirectly the beneficiary of, a Trust in the Channel Islands ? Ja m e s O 'D w yer Pa Jo h n S .W alsh M Colm D uggan h . M c L a u g h l in ic h a e l Carl M O 'S u l l iv a n C a r o l in e D e v u n C ia k a n B o ig e r G W il l ia m D ay A ndrew L enny C o n su lta n ts: V in c e n t Ia n A. Sc o tt Jo s e p h e c iie n Isabel rego ry Jo h n M W alsh L D a n ie l H . O ’C o n n o r eyden F oley Jo h n W il l ia m M eade P e t e r M c L a u g h l in Jo h n s t o n Conor Hugene M M c Do n n ell c Ro ber t B o lto n Cague Pa t r ic k M G lynn D a v id F o l e y S t e p h e n I I e g a r t y D e c l a n D r is l a n e S a r a h O en to n Pa t r ic k O ’ B r ie n O r i-v O 'C o n n o r D e n is J. B e r g in C hetvcode H a m il t o n N ia l i . B r ia n O ’G o r m a n M c L a u g h l in N ic h o l a s cG overn tv n if f M Jo h n V. O ’ D w y e r G. M oore G r a in n e H D Ro n a n Wa ls h eclan enn essy H ayes S£ a m u s D o n o g h C r o w ley Da v id G iv e n O ’D onohoe Co u n Byrne K a t h l e e n G a r r e t t P a d r a ig 6 R io r d a in E l i z a b e t h B o t h w e l l ar k Sa u n d e r s M a r k B arr Jo h n M a t s o n D eb o r ah S pence D r . Y v o n n e Sc a n n e l l D r . R o b e r t C l a r k J o h n G . F is h D r . M a r y R e d m o n d Answer: (B) I did not personally nor did anyone on my behalf ever establish for my benefit a Trust in the Channel Islands. I confirm to the best of my knowledge and belief I have never received any benefits either directly or indirectly from any trust that may have been established in the Channel Islands or anywhere else. Question: (c) D i d such Trust continue after 1981 ? Answer: (C) Not applicable. Question: (cl) Ifyour relationship with College Trustees continued after 1981, did you avail of any of the services provided by Ansbacher (C a y m a n ) Limited, as set out above ? Answer: (D) Please see my reply to (A) above. I have never personally nor to the best of my knowledge has any company with which I may be associated knowingly availed of any services provided by Ansbacher (Cayman) Limited. Within the furnished GMI documents not one letter was received directly or indirectly or copied to our client, confirming that our client was a beneficiary of a Trust in the Channel Islands nor did our client avail of any of the services provided by Ansbacher (Cayman) Limited. Examination 22nd May 2000 You next requested our client to appear for examination on the 22nd May 2000. At that examination your letter dated 7thFebruary, 2000 and our clients response dated 18thFebruary, 2000 was put to our client for the record. He again confirmed that he was never a client of College Trustees and that he never established a Trust in the Channel Islands and or the Cayman Islands. The evidence by our client confirmed that he did not have any knowledge of any deposit of which he had an interest either in the Cayman or the Channel Islands that might have been connected with our clients loan. The evidence by our client also confirmed that he never set up a trust or put funds off shore. The evidence confirmed that he met Des Traynor on only one occasion. His evidence also confirmed that he never received any investment advise from Guinness & Mahon. In actual fact our client confirmed that Guinness & Mahon Ireland were trying to get their money back from loans that he secured rather than them looking after his funds. Our clients evidence indicated that he did not deal with any specific individuals in the bank and in actual fact every time he visited his Bank he dealt with a different person. In addition our client confirmed as far as he was aware he got loans from Guinness & Mahon and he did not know why Ansbacher would have any interest in them. A JtT H im c o x In respect of your Preliminary Conclusions and the numbered paragraphs we respond as follows ^ 1. Noted 2. We are indeed surprised that you are relying on an internal GMI document dated the 4th September 1989 which was not put to our client in his evidence on the 22nd May 2000 and the particular quote: "(Mr.. Turley’ s) facilities ............. were provided on the basis that security w a s adequate to tke extent of S T G £ l m . D u e to the banks changing relationship with the off shore connections a n d in particular with the departure of Padraig Collery f r o m G & M , it has been agreed with Mr. Turley that our facilities with h i m / A r g u s / G M B should n o w be formalised without regard to the adequate security. It is proposed that G & M should take security over a n u m b e r of investment properties o w n e d by Mr. Turley". The Inspectors leap to now state, without the question being put to Mr. Turley, that this was knowledge of the deposit and their conclusion is unjust and unfair. This document was not put to our client in direct evidence. This is an internal GMI document, the author of which our client is unaware of. We do not know whether or not this particular person gave evidence to the Inspectors and was this particular proposition put to the person in question regarding our client. No other document is relied on by the Inspectors which confirms directly or indirectly that Mr. Turley received a letter confirming this position. ^ The GMI internal banking and record keeping was obviously different in that certain matters were dealt internally which were not communicated in any shape or form to the individual customers as otherwise other questions would have been raised by customers querying such issues or arrangements. To imply knowledge to our client in respect of that written reference is inappropriate considering the above circumstances. It is clear from the documentation that Arthur Cox represented Mr. Turley for several years. The title documents to those properties were in the possession of Arthur Cox on undertakings to GMI and therefore GMI’s security was always adequately covered but was never requested to be formalised by GMI accordingly. Mr. Turley would however have given personal guarantees (in the Banks standard form) and given to the Bank from time to time Statements of his net worth (which would have very substantially exceeded any borrowing, and would demonstrate that the loan was fully secured) The other document that you again rely on is an internal GMI document dated the 28th September 1989. In particular the following remarks were identified:"The present limits to the [Guinness M a h o n ] G r o u p are set out on p a g e 1 of the accompanying m e m o r a n d a a n d total an exposure of £450,000.00 a n d these are currently secured by "adequate" deposits which are effectively under Du b l i n ’ s control. The Committee will be aware of the background of such security a n d the fact that, in certain cases, this m a y be withdrawn in the foreseeable future. This is one such case where the customer has been informed that the B a n k would prefer to have such arrangements conducted elsewhere, unless additional security could be provided". This document was not put to our client in direct evidence. It is an internal GMI memo. We are unaware of whether Michael Whitmarsh has given evidence in respect of this document and whether direct questions were put to him in respect of Mr. Turley and in particular the inference that has now been drawn by the Inspectors regarding this particular quotation. ^ This GMI internal memorandum was also written in the same month as the previous document and as previously outlined GMI loans with our client were always secured in the sense that the necessary security was in place as Arthur Cox had given undertakings regarding the title deeds of the properties of the client herein. The "additional security" would obviously be more formalised documentation and guarantees respectively. 3. The only document that was put to our client is referenced in your Inspectors Preliminary Conclusions which is the letter of the 9thJanuary 1990. One accepts that it is on Ansbacher letter heading and it does request a number of account balances but again we have never seen the original of this document. We were handed a photocopy. We are unclear of the handwriting that appears on it and whose handwriting it is. We are unaware of whether Martin Lanigan-O’Keeffe has given evidence in particular regarding this letter of the 9th January 1990 which would ascertain the position regarding the knowledge of our client accordingly. Our clients evidence to the Inspector on the 22nd May 2000 confirms that he has no idea why Mr. Traynor from Ansbacher would be enquiring about our clients loans or GMB’s. In addition with all the documentation that is at your disposal and from all the information that our client has furnished not one document or letter addressed to our client from GMI and/or from Ansbacher confirms anything contrary to the evidence that our client has given. In addition Mr. Traynor did write on Ansbacher notepaper to Mr. O’Keeffe on the 9th January 1990 but we have no evidence as to why the letter was written, who instructed him and why it was written. It does not state that our client was a client of Ansbacher nor does it state that our client instructed him to write the letter. It is a letter of enquiry of GMI on the balances in accounts but we have no evidence or document to confirm the location of those accounts. 4. In respect of your Preliminary Conclusions we have set out our position accordingly and ask you to reconsider same. 5. In assessing Mr. Turley’s evidence we fail to see how you can come to your conclusions in light of what we have said and in particular the three particular documents, two of which were not put to our client. We have also set out our position regarding those documents accordingly. A K T fflm C O X Conclusion Our client has always maintained and stated he is not nor never was a client of Ansbacher and specifically neither he nor any of his children or any company which he or they were in any way associated with had ever had any deposits of any nature or description with Ansbacher. We therefore urgently request the Inspectors reconsider their preliminary findings herein as the claim that our client was a client of Ansbacher and that he had funds with them is factually incorrect and if the claim were not withdrawn then the claim will cause irreparable damage to our client’s good name and reputation. We have already highlighted and with the respect submit that it is totally unreasonable and unfair that our client should be prejudiced in this way because of the failure of GMI to keep proper records of its dealings with our client and if such records had been kept our client would not find himself the subject of this investigation. The poor quality of the GMI record keeping is further evidenced by the fact that when our client received a copy of his files same contained correspondence and notes clearly relating to other clients of GMI. Finally, we confirm that Mr. Turley still has borrowings with Guinness & Mahon and as far as he is aware security for these facilities has been the same for the last twenty years approximately and all the borrowings were on terms that would have been freely available in the Banking Market to individuals or companies of similar standing to our client without additional security. Every loan to our client or companies associated with him were secured and the security provided was that set out in each of the facility letters. Yours faithfully ARTHUR COX Appendix XV (129) Mr Martin Turley 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Martin Turley. a) Telefax of 1 1 November 1994 Ansbacher (Cayman) Limited to IIB. PA.Bok8S7 Gmnd Cayman MHRMIIMWI w _ * FaoMto809M95267 T elefa x From: Ooftn. A. Furza Raf no. To: Irish Intercontinental 9*nk - Dublin, Inland Attention: ms. quhe Fax No: 011-353-1-678-5034 Date: 1 1 Novaster, 1994 vo m k »s s i i s No. of Pagea mis page only. (WudngMione): We should be grtteftil if, value 16th November, 1994, you would kindly arrange to tnxufer Stg. £1.776,778.11 (one mflKon, seven hundred and seventy-six thousand, seven hundred and seventy-eight pounds, eleven pence) u follow s:- Bank: UlsterBankLtd.Intemation&lDivision UlsterBank (IOM) Ltd. 40, Linenhall Street, Belfast, BT2 8AZ Number. 4009571301 Re: MartinTurley No. 617318 SortCode: 98-00-05 SwiftNo.: ULFBGB2B Please debit our account number 02/01087/81 Yours faithfully, n ? 7 JENNISONE. NUNEZ YOU HAVE NOT KKCMD THITOTAL NUMMR OF PAOtt Oft f YOU NBQ ASSSTAMCE FLEASC CALL MfrSSSS OQtMNNIIMJTYN0TKS TOttin tnl i m anga indtat ft* feoumrt* itoonw g 1 My b* pMagad «rf oonHwt* m i ta n * ta n dkdanra unda apptaWafcw. ltoraa4«HRailiaUMMfaa0Mt«tiaM0ai(aact*MfaaeaNfelalarMMnelloaialNMdad«adpM,«y " * * ■ " < **•. copjfc#, MriMfca a dam M lan H prekMM. lyw luM iM w M M knkntatar ttiy avy)ln wro.phm iwWyw t t c n tlMlSW IIIWMidittotiWilMWiirtinya^MiaiaMKieBMpcartto. Dunk OM tnwy. Monaco, 8wlaartand. Ma of Man. Raham u, Cayman Utandj. British Vfrgin IsUndt •S655 A ppendix X V (130) Sir C harles V illiers, deceased l. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Sir Charles Villiers, deceased. a) Letter of 16 October 2000 - Lovegrove & Eliot Solicitors to Secretary to Inspectors. b) Internal Guinness and Mahon memo of 16 December 1981 - JDT to BMcL. c) Letter of 16 October 1990 - Ansbacher Limited to Guinness and Mahon. d) Letter of 10 July 1990 - Ansbacher Limited to Guinness and Mhaon. e) Letter of 10 February 1992 - Guinness and Mahon to Lovegrove & Eliot Solicitors. - i_ r* Lovegrove & Eliot f t u r A . Simpson,o &e. 4/S ftrkS eraat Wlmfaor, Berkshire SL4 IjS IW aphona: 0I7S3 851133 Pac*lm ll« 01753 8S08I2 D * 3808 WINDSOR S o lic ito rs an d C o m m issio n e rs fo r O a th s Barry S. Mdwiwy Co8n F.Sdmdhorst Douflu JJ=. C am * m . GWhn j. Edward*, 11* Kakh B, BiA il& Coraukancs John E. Huideodt, LvaDL.ua. GmjaM LBiot O ur Ref PAS/AH Your R et c / y O l / F G A jaocta Patricia Doylm, m . 16 October 2000 7^ Ms FrancesGaynor SecretarytotheInspectors OfficeoftheInspectorsappointedby Order oftheHigh CourttoAnsbacher (Cayman) Ltd 3rdFloor TridentHouse Blackrock Co Dublin 1 1 3C7 m Dear Ms Gaynor The late Sir Charles V illiers Thank you foryourletterof9thOctober. ? I am sorry that ithas taken me longer than I had anticipated to deal with this matter. Following our earlierexchangeofcorrespondence inAugust, Iwrote toLady Villiers. She has authorised me to disclose to you any information which can be taken from the files relating to die administration ofthe Estate ofthe Late Sir Charles Villiers. She has also researched her own papers and states that she has only found one mention ofAnsbacher (Cayman) Limited and thatappeared in a letterwritten to her in March 1992. She made theassumption thatIwould have a copy ofthatletteron my filebut infactIcan trace no such letter. . Lady Villiershas offeredto come to my officeto discussthe matterbut ifthatisthe only informationthatshe can make availableIdo notseeany necessityatthisstagetoask herto travel to my office. She statesthatshe has littleorno recollection oftheLate SirCharles VilliersdealingwithAnsbacher(Cayman). Ihave researched the papers in relation to the administration ofthe Estate and I enclose herewith a copy ofa memorandum dated 1* Februaiy 1977, which appears to have been issued by Guinness Mahon & Co Ltd and relatesto benefits arising from a scheme from Guinness Mahon & Co being transferred in the form of paid-up policies. You will see from this that there are eleven policies mentioned. Sir Charles Villiers died on 22nd January 1992 from cancer. He knew thathis illnesswas terminal and itappears thatvery shortly before his death he typed out a list of “important addresses and telephone Also a t 7 High Street, Etfam. Surrey TWM 9EA Telephone 01784 436471/4 Facsimile: 01784 438692 Authorised by die Law Society in die conduct of investment budnest M SFLA Fufty !>*" Aweehdw numbers”. This specified his Accountant, his Solicitor, his Bank Manager and Stockbroker, and included in that listthere is“Guinness and Mahon for Cayman Trust”. The contact is given as Mr Traynor or Miss Williams, College Green, Dublin 2 and the telephonenumber as010 3531-765-144. Because of the confidential nature of your enquiries I have made no attempt to contact Guinness Mahon. I d*/not deal directly with the administration of Sir Charles Villiers’ Estate and entrusted thisto an Associate Partner,Miss Beatrice Curtis, who has since left thefirm. However from theenquiresIhavemade itwould appearthatthepoliciesreferred to inthe 1977 memorandupxtid notform partofSirCharles’Estate. Itispossiblethatthe policieswould have mattired^n hisretirement,which occurred intheearly 1980s. Ifyou requireme tomake furtherinvestigationIwillbe pleasedtodo so. Yours sincereK^y' PA Simpson LOVEGROVE « ..JOT r v. Could you p l i u * arranga to pwraluuM U.S. Dollars to tho ▼alna of £1,651.99 Starling, bolac tho balanca on C.H.T. Wt'KT T,* C & L v w V „...........—■ p.a Bwi 17.OmdQmn, MU* Dtat hdte Unmc 009} MM133/4 T rin : CP49Q3 42 FitzwQliun Square, Dublin 2. - v/v' Hue(KN) M9-7946 (Ml) 904267 Id: 765144/763065 Fax: 612035 16th October, 1990. M. David Humphries, Esq., Senior Manager - Operations, Guinness ft Mahon Limited, 17-College Green, DPBLIN 2. oeax Daviu, Could you please arrange the transfer of Stg.E31,524.85 to: Royal Bank of/Scotland, City Branch, 67 Lombard pfcreet, LONDON BC3i for credit of AccounyNo.18413283 Account Name: Sir ChafXVfe Villiers. Please debit Ansbacher Limited Account No.13154602. Yours sincere! J.D. Traynor. AMtmhrtftki Bm Fleate replyto: 42 FitzwflHam Square, Dublin 2. Ifet 765144/763065 Rue 612035 Fuc (Nl)M9-794C QOQMMMT 10th July, 1990 N . D a v i d H u m p h r ie s , E s q . , S e n i o r M anager - O p e r a t io n s , G u i n n e s s ft M ahon L i m i t e d , 17 C o lle g e G reen , DUBLIN 2. i D ear n a r id , Could you ple~.se arrange for the transfer of S t g . £10,000 to Royal Bank of Scotland 67 Lombard Street London BC3 fo r c r e d it o f th e A ccount o f Sir Charles B. Villiers Account No.18413286 T h e cost should be debited to Ansbacher Limited Account No.13154602. Yours sincerely, J .D . T rayn or F i l l in ® 1® 5 & 10 Fateoary 1992 Toar »*f* U/S6F/Villlars lowgrow ( KUlot, Solicitors. 4, Vuk Straat, V lf ld tO T i . Barkahira SU US.' Daar Sir, illdh BrOmYllllara M.C. B at I rafar to your latter of January 28th. 1992. Kindly aota that X it on toi Me. J.D. Trayaor, % 42, IltnrilliM i Square, Dahlln 2. I andaratand tbat Mr. Traynor «U1 contact yea in daa conraa. Toara faithfully. 0 M. DnrU HnaVhrias Senior W tgtr, Operation* I Appendix XV (131) Dr Oliver Waldron 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Dr Oliver Waldron. a) Statement of Dr Oliver Waldron dated 29 November 2000. I (mum Statement made at the request of the Inspectors appointed by the High Court to Anabacher (Cayman) Limited, ref.C/W01/NDP dated 29/11/2000 Details of Relationship between Oliver Waldron, Guinness Mahon (Ireland) LimitedCGMnL”) and Guinness Mahon Cayman Trust Limited(‘* G M C T n) I had lived abroad and had worked in the natural resource industry in a number of countries from 1965 until the second half of 1972 when 1 returned to Ireland from Canada to take up an appointment as the m anaging director of Tara Mines Limited. I worked in Ireland until mid-1974 for Tara Mines Limited when I resigned from that company. From late 1974 to mid-1983 I worked in a part time capacity for a number of Irish companies and also worked overseas as a consultant to a number of overseas companies on various international business proposals and projects. I moved m y residence from Ireland to the U K in 1983.1 have not been resident in Ireland since July 1983. , O n moving to Ireland in 1972 I sold some of m y property and personal investments held abroad and brought some assets to Ireland mainly to purchase a dwelling for m y family. I also left some assets overseas at that time part of which were used to establish a discretionary trust for m y dependents with Guinness Mahon Cayman Trust Limited acting as trustees. I settled the trust with certain cash and assets acquired by me prior to m y return to Ireland and the beneficiaries of die trust were m y children. I was advised by Mr Desmond Traynor of Guinness Mahon (Ireland) Limited in setting up die trust and M r John Furze of G M C T acted as the principal trustee and manager for die trust The trust funds and assets were held by the trust in the Cayman Islands managed by GMCT. In addition some of die trust assets were held in a Cayman Islands registered company controlled and managed by G MCT, called Inter Agent Limited(“IAL”). Assets of the trust were also held in other nominee names or companies controlled by GMCT, on behalf of the trust Neither IAL nor any of the other companies used by G M C T in managing the trust assets were owned by m e and, as far as Iknow, these companies were also used as holding nominees for other clients of GMCT. I was a private client of Guinness Mahon (Ireland) Limited from approximately 1972 to 1983 having had various small loan accounts with die bank in m y own name and that of a company ofmine called Irish Mining Services Limited. All of die loans were on commercial terms and repayment of the loans was guaranteed by m e personally in all cases. All of the loan amounts including accrued interest were repaid by me to Guinness & Mahon (Ireland) Limited from personal funds held in Ireland. After the discharge of the loans from GMIL, on or about 1982, 1 ceased to have any further personal accounts or dealings with the bank. The trust funds and assets held by G M C T were managed by M r Furze. Small amounts from die trust fund were paid to me in Ireland from time to time during 1972 and 1983 to defray expenses incurred on behalf of the beneficiaries such as school expenses etc. After moving to the U K in 1983 the trust assets were liquidated and were employed to fund the private education of m y four children. By the mid to late 1980’s all of the funds of the trust were exhausted and the trustbecame dormant. I do not know what became ofthe trustbut Ithink itwas wound up or became disused. Sometime during 1984 or 198S an Irish registered public company, Oliver Prospecting & Mining Company Limited(later Oliver Resources pic and now Dragon Oil pic), of which I was then a director, acquired a Cayman Islands registered company, Wington Enterprises Limited, from a third party in the normal course of its business. The board of Oliver appointed G M C T as managers of Wington for reasons of administrative convenience and the affairs of Wington were managed by G M C T on the instructions of the board of Oliver. At a later date toward the end of the 1980’s when the activities of Wington had virtually ceased the management contract with G M C T was terminated. I have no records of the Wington transactions conducted by G M C T other than those in the file which is herewith attached. The Wington arrangements with G M C T were not related in any way to m y personal affiurs. The board of Oliver engaged G M C T on a purely commercial basis to manage the affairs of Wington in the Cayman Islands. Oliver, as a listed public company, had a number of overseas subsidiaries to hold exploration properties in foreign countries and Wington, when acquired by Oliver, owned certain oil exploration rights in Abu Dhabi which Oliver wished to progress. I imagine G M C T was selected by the board of Oliver upon m y suggestion since I had had the earlier experience of dealing with G M C T in connection with m y personal affairs. I have moved residence a number of times since leaving Ireland in 1983 and I have not retained any records of the trust or of any transactions of the trust or of m y dealings with G M C T since the trust’s activities ceased. Also I have not retained any personal records of m y dealings with Guinness Mahon (Ireland) Limited. Since you raised your enquiry I requested G MIL that they provide me with a copy of any records they possessed relating to me. I now enclose herewith a copy of all those records provided to m e by Guinness Mahon's office in Dublin recently on foot of m y request. C/o Whitney Moore & Keller Wilton Place Dublin 2 24 January 2001 Appendix XV (132) Mr Joseph Walsh 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Joseph Walsh. a) Transcript of evidence of Mr Joseph Walsh dated 20 June 2000. b) Letter of 3 May 2000 Gore Grimes Solicitors to Inspectors. 0) Letter of 24 May 2000 Mr Cathal McCarthy to Mr Anthony Gore Grimes. d) Guinness and Mahon credit committee minute no 001739. e) Guinness and Mahon credit committee minute of 15 August 1986. UNDER OATH ON TUESDAY, 20TH JUNE 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer MR. ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. JOSEPH WALSH Represented by: MS. CAROLINE COSTELLO BL Instructed by: MR. ANTHONY GORE-GRIMES GORE & GRIMES CAVENDISH HOUSE SMITHFIELD DUBLIN 7 1 2 3 4 MR. ROWAN: 5 Good morning, Mr. Walsh. My name is Paul Rowan I am 6 one of the inspectors and this is my fellow 7 inspector, Ms. Noreen Mackey. 8 Mr. Walsh, nor is it a tribunal, it is an interview 9 and if during the course of the interview you wish This is not a court, 10 to seek some advice from your legal representatives 11 if you ask us to stop asking questions we will allow 12 you to seek some advice. 13 representatives feel that they wish to offer you 14 some guidance if they ask us to stop they may do so. Equally, if your legal 15 16 We are going to make a record of the interview and 17 afterwards you will be asked to sign a transcript. 18 So if I may ask Ms. Cummins, our solicitor, to 19 administer the oath, please. 20 21 22 23 24 25 26 27 28 29 1 2 3 4 MR. ROWAN: Ms. Mackey will ask you 5 6 some questions. 1 Q. MS. MACKEY: Mr. Walsh, just for the 7 record before we actually 8 look at the statement which you provided to us, I 9 would just like to you ask you for your full name 10 and details of your career, your professional 11 business life to date. 12 A. 13 2 Q. 14 A. 15 3 Q. 16 A. 17 4 Q. 18 A. 19 5 Q. Just Joseph Walsh? 20 A. Just Joseph Walsh. 21 6 Q. 24 Joseph Walsh. What is your full name? Joseph Walsh. Do you have a middle name? No. You haven't? No. Can you tell me a little bit about your background, your career and so on? 22 23 Your name is? A. Well, myself my own person? 7 Q. Yes. 25 A. 26 8 Q. 27 A. Well I am 78 years of age. You are retired now from business? I am retired from business. My father died when I 28 was six, my mother died when I was ten and I left 29 school when I was 14. 1 9 Q. 2 A. 3 10 Q. 5 A. 6 11 Q. 7 A. 8 12 Q. 9 A. 13 Q. Bar, grocery and green business. What was the name of that grocery? D. Walsh & Sons. And that was your family business? That was the family business, yes, my brother was Did you continue on in that business throughout your life? 12 13 A. 14 14 Q. 15 Throughout my life. I am retired now. The name of the company continued to be D. Walsh, did it? 16 A. 17 15 Q. 18 Correct. At the time of your retirement what was your position in it? 19 A. 20 16 Q. I was managing director with my brother, I suppose. Did you have any other business interest over the years, were you director in any other company? 21 22 A. 23 17 Q. 24 A. 25 Yes, Grassland Fertilizers in Dublin. Was that a family company? It started out as a family company but then we joined up with Arnold Suhr. 26 18 Q. 27 A. 29 It was barley, grocery and green grocery? with me. 10 28 At that stage I went to work in our business which was a bar, and grocery and green grocery. 4 11 What was your business background, what did you do? With what? He bought shares in it in 1960 - can I ask my solicitor? 1 2 A. 3 19 Q. I think it was 1966. MS. MACKEY: They are your two business 4 interests. 5 A. 6 20 Q. Is that it? They are my two main business interests, yes. Do you have a copy with you of the statement that 7 you sent us in, Mr. Walsh, you might go through it. 8 If not we will give you a copy. 9 could turn to page two of this statement (Exhibit 10 (Same handed) If we 1 )? 11 A. 12 21 Q. Yes. There are a number of things I would just like to 13 clarify in this. 14 tell us that you have not received any response from 15 Ansbacher Cayman, prior to that you tell us that you 16 had written to the Channel Islands and to Ansbacher 17 to see if they could give you any information about 18 your affairs? 19 A. 20 22 Q. At the second paragraph there you Yes, my solicitor did. It appears that Ansbacher Cayman didn't reply but 21 your solicitor telephoned them, or you telephoned 22 them? 23 A. 24 23 Q. My solicitor did. And was advised that a trust had been established on 25 27th November, 1989, in which the settlor was John 26 Furze? 27 A. 28 24 Q. 29 Yes. That statement is a little bit unclear. Do you 1 2 didn't sign anything over to the Cayman Islands. 3 didn't know anything about the Cayman Islands. 4 25 Q Maybe we will come back to do. If we go on down to 5 your answer to question number one there, you say, 6 your solicitor says: 7 I "My client did not cause any deed of trust to be created in the Cayman Islands. He caused a deed of trust to be executed in the Channel Islands, though he does not have any copy of this." 8 9 10 11 I would like you to tell me just a little bit about 12 that trust that you caused to be executed in the 13 Channel Islands. 14 happen? 15 A 16 26 Q 17 First of all, when did this In the early '70's. Was it through Guinness & Mahon in Dublin that this was done? 18 A 19 27 Q 20 A 21 28 Q Through Guinness & Mahon, yes, through Des Traynor. Through Des Traynor? Yes . Maybe we could go back a little bit to just look at 22 your relationship, generally, with Guinness & Mahon 23 and with Des Traynor. 24 relationship with Guinness & Mahon before that? 25 A Had you a business I had, yes, through Grassland. 26 When did your fist relationship with Guinness & 27 Mahon begin? 28 At that particular time, can I ask my solicitor? 29 1 30 Q. MS. MACKEY: remember it is fine to 2 3 just say you can't remember. 4 A. 5 31 Q. 6 A. 7 32 Q. 9 A. 10 33 Q. 11 A. 12 34 Q. 13 Sometime in the '60's? Sometime in the '60's, yes. You commenced a business relationship with Guinness Correct. For Grassland? For Grassland, yes. How did you come into contact with them, were you introduced to them by someone? A. 15 I was introduced to them and I met them through Grassland, we were doing business with him. 16 35 Q. 17 A. 18 36 Q. With Des Traynor himself? With the bank and Des Traynor. How did Grassland come to be doing business with him? 19 20 It is very hard for me to remember. & Mahon? 8 14 Roughly, if you can't A. They had some money from them, they had some accounts, as far as I know, with them. 21 22 37 Q. 23 A. 24 38 Q. 25 A. 26 39 Q. With Guinness & Mahon? Yes. You met him for the first time then, is that it? That is the first time I met him, yes. Over the years did you have any personal banking 27 relationship with Guinness & Mahon up until the time 28 of this trust? 29 1 2 A. 3 41 Q. I knew Des Traynor during that time. Coming then to the time when you caused this deed of 4 trust to be executed in the Channel Islands, how did 5 that come about? 6 A. He asked me, you know the way when you are talking 7 to a banker looking for business, or an insurance 8 man looking for business, so I told him I had an 9 idea that I would like to leave some money to my 10 nieces and nephews. 11 that he would look into it and come back to me. 12 came back and said that this trust would be a good 13 idea. 14 42 Q. 15 A. 17 43 Q. 18 Did he explain anything to you about the trust, did He did, yes. Did you understand what a discretionary trust meant, or did he tell you? A. He must have told me because as far as I knew 20 discretionary means that they can look after the 21 trust for you. 22 44 Q. 23 A. 24 45 Q. 25 26 29 Can you recollect what he told you at that time? No, I would be afraid I wouldn't recollect. If you can't recollect, fine, but if you can remember? A. 27 28 He he say it would be a discretionary trust? 16 19 I had that in mind and he said Yes, he said it would be a good idea for my nieces and nephews that I could leave it there for them. 46 Q. Did he tell you that the funds would be held by 1 2 47 Q. 3 A. 4 48 Q. 5 A. 6 49 Q. 7 A. 8 50 Q. 9 A. 10 51 Q. A. 13 14 52 Q. He didn't, no. Where it would be, what country it would be? In the Channel Islands. He told you it would be in the Channel Islands? Yes. Did he say it would be managed by a subsidiary of I can't recollect whether he did or he didn't, he What you recollect is he told you that it would be a good idea to set up a trust in the Channel Islands? 16 A. 17 53 Q. 18 Yes. That the money would be held by trustees but he didn't tell you who the trustees would be? 19 A. 20 54 Q. 21 No. Did he say that you would be the settlor of the funds or that somebody else would be? A. 23 24 Did he mention a company? may have but I couldn't say for certain that he did. 15 22 No, he never mentioned any names. Guinness & Mahon in the Channel Islands? 11 12 Did he say who the trustees would be? I am not with you now, that I would have to settle financially? 55 Q. That you would settle funds on the trustees, that 25 you would pass funds to the trustees and sign a deed 26 of trust? 27 A. 28 56 Q. 29 Correct. He told you that? 1 57 Q 2 A 3 58 Q 4 A 5 59 Q 6 A 7 8 Do you have a copy of that? I haven't, no, he gave me no copy of it. Do you recollect what it said? That the funds would be for my nieces and nephews, when I died, of course. 60 Q 9 10 I did, yes. Do you recollect that you were one of the named beneficiaries yourself under the trust? A Yes, he said that if I wanted my original £100,000, 11 I think it was £100,000 or it might have been 12 £97,000 or £102,000, I can't remember, that I could 13 take that at any time, that I could reclaim, I 14 suppose is the word. 15 61 Q 16 trust was around that sum, was that it? 17 A 18 62 Q 19 A 20 63 Q 21 22 Effectively the money that you were putting into the Correct. You were putting in £100,000? Yes . He said to you that if you wanted it at any time you could reclaim it? A 23 Yes, if I wanted it, I didn't ever think that I would reclaim it. 24 64 Q 25 A 26 65 Q But you understood that you could if you wanted? Yes, he said if you need it you can have it. Very good. Well, if we can go back here to your 27 statement (Exhibit 1) a little bit and look at the 28 questions at number 1 there, at 1 (b) your solicitor 29 says : 1 "The only money which my client transferred were transferred to Guinness & Mahon Limited for onwards transmission by way of loan to the Channel Islands structure set up by Guinness & Mahon." 2 3 4 5 What does that mean, Mr. Walsh, the Channel Islands 6 structure that you are talking about there, is that 7 the trust? 8 A. 9 66 Q. That's the trust, yes. What were you saying there that you gave the money 10 by way of loan to the trust, I don't understand 11 that? 12 A. I didn't intend it that it was going to be a loan, 13 but if he said if I wanted to take it back that I 14 could take it back, it was a loan to the trust, 15 whatever the trusts made they had it. 16 intended taking back the money. 17 67 Q. I never As far as you were concerned this was money that you 18 were putting into a trust for your nieces and 19 nephews ? 20 A. 21 68 Q. Correct. You were not of the view that you were lending money 22 to some people over in the Channel Islands, were 23 you, for them to do what they liked with? 24 A. 25 69 Q. 26 They were in charge, but they were holding it on trust for your nieces and nephews; is that right? 27 A. 28 70 Q. 29 Well once they were -- the trustees were in charge. Correct. To say that you were lending money wasn't really the 1 A. The position was that if I wanted this money, that 2 he thought I might need the money at some time I 3 presume, I could have that money. 4 that I was going to take it and what really happened 5 was a brother of mine died. 6 71 Q. I never dreamt We can come on to that in due course, that is where 7 you got it back. 8 planning at that point, as you say you didn't intend 9 ever to take it back, but you were planning that 10 this money would be held in trust in the Channel 11 Islands for your nieces and nephews? 12 A. 13 72 Q. In any event, what you were Correct. Can I ask why you thought it would be a good idea 14 that it would be held in the Channel Islands as 15 opposed to here in Ireland for your nieces and 16 nephews ? 17 A. 18 Well he suggested the Channel Islands and I trusted him being a banker and that. 19 73 Q. 20 A. 21 Did he say why? Not that I can recollect, he didn't, I don't believe I asked him. 22 74 Q. 23 A. 24 75 Q. 25 A. 26 76 Q. This was I think you said 1970, what year? 1972 or 1973. 1972 or thereabouts? Yes. Your money stayed there, anyway for up to, I think 27 it was 1993, was it, after Mr. Traynor's death 1995. 28 Your money was there from 1972. 29 contact with -- I beg your pardon. Did you keep in 1 back said it wasn't 2 3 actually there. 4 MS. COSTELLO: It was somewhere. It was somewhere, we are 5 6 not definite where it was. 77 Q. MS. MACKEY: The money was away from 7 Mr. Walsh anyway during 8 that period, from 1972 onwards until such time as 9 you got it back. Did you get any statements of what 10 was happening to it, statements of account during 11 that time? 12 A. 13 78 Q. 14 A. 15 79 Q. 16 17 Nothing at all? Nothing at all, I never looked for them. You never looked for them. Did you ever discuss it again with Mr. Traynor during those years? A. 18 19 No. No, I met him afterwards. We didn't discuss it, he just said it was going alright, that's all. 80 Q. You would have put that money there, you would have 20 viewed it, no doubt, as an investment that would 21 grow for your nieces and nephews; is that right? 22 A. 23 81 Q. 24 Correct. You would have expected that over the years it would appreciate? 25 A. 26 82 Q. I would imagine so, yes. Did you never ask Mr. Traynor what stage was it now 27 at or what had happened to it or was it earning a 28 good rate of interest? 29 1 2 83 Q. 3 A. 4 84 Q. 5 A. 6 85 Q. 7 A. 8 86 Q. 9 He told you it was doing well? Yes. You understood that it was growing? Yes. And you were happy with that? I was happy with that. Now, at the time that you were setting up the trust, Mr. Traynor, as you said, gave you this advice and 10 you trusted him. 11 legal advice about setting it up at the time? 12 A. 13 87 Q. 14 A. 15 88 Q. 16 A. 17 89 Q. 18 A. 19 90 Q. 20 A. Did you get any other financial or I had an accountant at the time. Who was he? Des Crowley. Of? Of Kilkenny. Des Crowley; is that right? Yes. He advised you on the trust did he? He said if that's the way you felt about it that you 21 want to leave it to your nieces and nephews, your 22 wife will be well looked after, so my wife was well 23 looked after so it was alright. 24 91 Q. 25 He knew, you explained to him what the trust was and where it was and so on, did you? 26 A. 27 92 Q. 28 A. 29 93 Q. I told him, yes. That it was in the Channel Islands? That it was in the Channel Islands, I must have. Did he give you written advice about it at the time? 1 2 94 Q. 3 A. 4 95 Q. You just chatted with him? I just chatted with him, that's all I would do. If we can move on a little bit through your 5 statement and we turn over to the next page, and we 6 move down to number 6, we might go back again 7 afterwards a bit further up, if we look at number 6, 8 your solicitor says: 9 "My client understands that exchange control permission was not required for the repayment of the £100,000 loan referred to above. This is the only financial transaction which my client had with the Company." 10 11 12 13 Now, the company in our original letter to you, that 14 phrase or that word is used to describe Ansbacher 15 and in this reply to our question number 6, which 16 related to exchange control, you appear, if I am 17 understanding it correctly, to be saying that the 18 repayment, as you describe it, of your £100,000 loan 19 was the only transaction which you had with 20 Ansbacher and your solicitor goes on to say: 21 "The initial loan to the Channel Island trust structure does not appear to fall within the ambit of your enquiry." 22 23 You seem there to be saying, if I am correct, that 24 you gave the £100,000 initially to a 25 Channel Islands but the money that you got back came 26 from Ansbacher; is that correct? 27 A. 28 96 Q. 29 trust in the Correct. Can you tell me how that came about? Just tell me a 1 2 3 97 Q 4 5 First of all how you went about getting it back because I think Mr. Traynor had died at that stage? A A brother of my mine died, as I said earlier, he 6 died suddenly and I thought I would get back this 7 money for my nieces and nephews, one of them was 8 getting married. 9 98 Q originally planned? 10 11 These were the nieces and nephews that you had A Some of the nieces and nephews. Their father had 12 died suddenly and I thought I would get this money 13 and give it to them. 14 them. 15 99 Q I got it back and I gave it to Wait now, you got it back, what I want to find out 16 is how you got it back. 17 was now dead, he had died in 1994? 18 A 19 100 Q At this stage Mr. Traynor That is correct. According to your statement (Exhibit 1) here you were not sure who to contact in Guinness & Mahon? 20 21 A 22 101 Q 23 Correct, that's right. So you got in touch with Mr. Carty from Deloitte & Touche? 24 A 25 102 Q 26 That's right. First of all, why did you get in touch with Mr. Carty? 27 A 28 103 Q 29 A Because he was my solicitor at the time. He was your solicitor? 1 Sorry, my accountant. 2 3 104 Q 4 A 5 105 Q 6 A 7 106 Q Yes . Was he aware of your Channel Island trust? No, he wasn't, no. You went along to him and you said, what did you say? 8 9 He was your accountant at the time? A I told him that I had a trust in the Channel Islands 10 and that I wanted to get some money out to give to 11 my nieces and nephews that my brother had died and I 12 asked him could he do anything about it, so he said 13 he would look it up for me. 14 107 Q 15 Did you tell him who had been looking after it? Did you tell him Des Traynor had been involved? 16 A 17 108 Q 18 A 19 I am sure I did. I did, yes, I must have. And that you didn't know who to go to? I didn't know who to go to, no, I had nobody else to go to. 20 109 Q 21 A 22 110 Q 23 A He said he would look into it for you? He said he would look into it for me. Did he know who to go to? He must have, as far as I know, whoever he enquired 24 from he went and got it anyhow. 25 know, whether he knew he could go to somebody else 26 or what I don't know. 27 111 Q 28 A 29 I don't know did he Did he tell you what he did? No, he said he was going to see -- at first he didn't tell me, no, I don't believe he did. What 1 did he tell me, that he would look into it I 2 suppose, that's what he told me. 3 112 Q 4 you again and what he did he tell you? 5 A 6 113 Q 7 A 8 114 Q 9 10 He went off to look into it and then he came back to He told me, yes, that he would get it for me. That he would get it for you? Yes . Did he say to you what he had done in the meantime, or who he had spoken to? A I think he had spoken to, I don't know what the 11 man's name was. 12 MR. GORE-GRIMES: 13 It is there written down there. 14 A 15 115 Q Padraig Collery. MS. MACKEY: 16 He spoke to Padraig Collery? 17 A 18 116 Q 19 A 20 117 Q Yes . He told you he spoke to Padraig Collery? Yes . Did he tell you what the gist of the conversation with Mr. Collery was? 21 22 A 23 118 Q No, I don't think so, not that I can remember. What did he say to you, he said he had spoken to 24 Mr. Collery and he would be able to get your money 25 back? 26 A 27 119 Q 28 A 29 He said he would get the money for me, yes. From Mr. Collery? I presume it was from Mr. Collery he got it, I don't know. 1 120 Q. 2 A. 3 121 Q. 4 A. 5 122 Q. 6 A. 7 123 Q. What was the next thing that happened then? I got the money then. But how did you get it? I think he posted it to me. Mr. Collery posted it to you? No, Mr. Carty posted it to me. You don't recollect meeting Mr. Collery, do you and getting the money? 8 9 A. 10 124 Q. 11 A. 12 125 Q. I never met Mr. Collery in my life. Did you not? No. Might Mr. Carty have met him and got it from him, do you think? 13 14 A. 15 126 Q. I presume, I am not sure of what way he got it. When you were telling Mr. Carty that you wanted to 16 get back this money, you told him that this was 17 money that you had in trust in the Channel Islands? 18 A. 19 127 Q. 20 A. 21 22 Correct. And did you tell him this was a discretionary trust? I am sure I did, I don't remember, there again, I can't say for definite the wording I used. 128 Q. 23 Did you tell him that Mr. Traynor had explained to you that you could get back money if you wanted it? 24 A. Yes . 25 Q. Simply by asking for it, was that all you had to do? 26 A. I presumed it was a loan and it was my money. 27 Q. Was it an exact sum of £100, 000 that you asked for? 28 A. It was, yes. 29 Q. But you have explained to me already that you knew 1 2 It wasn't my money, the only money that was mine was 3 the £100,000, the other money was for the trust for 4 my nieces and nephews. 5 132 Q I see, so what you were doing here was you were withdrawing your original investment? 6 7 A 8 133 Q 9 Correct. But you were leaving all the interest that had accumulated in the trust? 10 A 11 134 Q 12 A It is still there. 13 135 Q It is still there? 14 A 15 136 Q Of course, yes. What became of that then? Yes . I see. Since you withdrew this £100,000 have you 16 had any contact with anybody about the balance that 17 remains ? 18 A 19 My solicitor was making some enquiries, but anybody else, no. 20 137 Q Have you been in contact with Mr. Collery? 21 A I don't know Mr. Collery, I never met him. 22 138 Q 23 A 24 139 Q 25 A 26 140 Q 27 But have you had any written communication with him? No, none whatsoever. Or has Mr. Carty on your behalf? I don't know, I don't think so. As far as you are concerned there is money sitting in a trust there? 28 A 29 141 Q Correct. You don't know how much it is? 1 2 142 Q. 3 A. 4 143 Q. 5 A. 6 144 Q. 7 A. 8 145 Q. 9 A. 10 146 Q. Do you? Yes. When did you learn how much was in it? When my solicitor told me. Your solicitor told you how much was in it? Yes. How did your solicitor know how much was in it? He must have found out about it. So, your solicitor, I presume, must have got 11 statements of the balance in the trust, would that 12 be the case? 13 A. 14 147 Q. Perhaps you would like to just talk to your solicitor for a moment. 15 16 A. 17 148 Q. 18 A. 19 149 Q. 20 No. Yes, he did, he told me the approximate amount. So you have a statement some where? No, I haven't I have no statement. Where did this information come from? MR. GORE-GRIMES: 21 Maybe just to help you, on the telephone to me when I 22 rang the people in the Cayman to ask them to assist 23 us and the information you have in the letter about 24 the trust, I asked them roughly what amount is there 25 and they told me the amount, which I then passed on 26 to Mr. Walsh. 27 MS. MACKEY: 28 29 There are no written 1 learned that your money 2 3 was in the Cayman Islands rather than in the Channel 4 Islands, when did you first become aware of that? 5 A 6 151 Q 7 A 8 152 Q 9 A I think 1995. After Mr. Traynor's death? After Mr. Traynor's death, yes. How did you become aware of that? I think it was when Paul Carty was looking for the 10 money, I think that was the time it surfaced that it 11 was in the Cayman Islands. 12 153 Q 13 Was it Mr. Carty told you that it was in the Cayman Islands ? 14 A 15 154 Q 16 A It was, I think, yes. Had he learned that from Mr. Collery? I don't know, well I would expect he did, when he 17 went to get the money he must have told him, I 18 expect, I don't know. 19 155 Q Were you surprised to learn that your money was in the Cayman Islands? 20 21 A 22 156 Q 23 A 24 I was amazed. Did you enquire how that came about? I didn't do anything about it, I mean what was I going to do there was a trust there. 25 157 Q 26 A Did you ask? No, I didn't know, how was I to know it was there. 27 I didn't know, I was amazed it had got there, how 28 did it get there, I didn't know it had got there. 29 158 Q Exactly, did you not ask Mr. Carty to look into this 1 and make sure that it was your money that you were 2 talking about the same trust and were you not a bit 3 anxious that perhaps this was not the correct trust? 4 I wasn't a bit anxious because Guinness & Mahon were 5 the people who was the original bank and I thought 6 everything was alright. 7 159 Q Did you say to Mr. Carty maybe we better look into 8 this and see is this the same money that was in the 9 Channel Islands or how it got there, or did Mr. Carty have some explanation for it? 10 11 A No, I don't remember being worried about it. The 12 only thing I was worried about, here I am in the 13 Cayman Islands how I got there, but I didn't follow 14 it up. 15 160 Q 16 A 17 161 Q 18 A 19 20 You didn't follow it up? No. You were satisfied that that was your money? I was satisfied, well I expected it was my money, it must have been. 162 Q From about 1995 you knew your money was in the 21 Cayman Islands and not in the Channel Islands and 22 you were satisfied that however it happened it was 23 your money and it had somehow or other been 24 transferred from the Channel Islands? 25 A Yes, and I had nothing to do with it. 26 Going back for a moment to the very beginning of the 27 whole thing when Mr. Traynor told you that if you 28 wanted to get back your money you could do so. 29 he say to you what you were to do if you wanted to Did 1 No. 2 3 164 Q 4 A 5 I didn't ever think it was going to arise. I didn't ask him or he didn't tell me. 6 165 Q 7 A Did he say that you would ask him, for example? No -- we are thirty years back I can't go into every question and give you a straight answer. 8 9 So how? 16 6 Q Looking again at your solicitor's statement (Exhibit 10 1 ) on your behalf could we go back to page 2 and to 11 the second paragraph where your solicitor talks 12 about his telephone conversation with Ansbacher in 13 Cayman. 14 sentence: 15 17 "They advised me that the trust owns a company which was incorporated on 28th June, 1989 in the Cayman Islands and is known as Drogheda Investments Ltd." Do you know anything about that, Mr. Walsh, about 18 Drogheda Investments? 16 19 A 20 167 Q 21 A 23 168 Q 24 A No. When the trust was in the Channel Islands was there There was a trust there but they didn't tell me the name. 169 Q 28 29 Never saw any statements of company accounts or a company involved with it? 26 27 No, I never heard tell of it until I saw this. anything like that relating to Drogheda Investments? 22 25 Do you see that, do you see the second last They didn't tell you whether it owned a company such as this one here in Cayman? A 1 170 Q So, up until hearing of Drogheda Investments you 2 were not aware of any company connected with your 3 trust? 4 A 5 6 A company connected with my trust, not that I know of, no not that I know of, I can't answer that. 171 Q If I could just recap then on your evidence here 7 today to make sure I have it correctly and correct 8 me if I am incorrect. 9 the Channel Islands? 10 A 11 172 Q 12 A 13 173 Q 14 A 16 174 Q 17 A Correct. And you signed a trust deed, to the best of your Yes . The beneficiaries were your nieces and nephews and Well not myself, myself I suppose if you include the £1 0 0 ,0 0 0 . 175 Q Were you named in the trust deed, can you recollect, as a beneficiary? 21 22 In the early 1970's? yourself; is that correct? 19 20 Correct. recollection? 15 18 You established a trust in A 23 No, I don't think so. No, I don't believe so. that I know of anyhow. 24 176 Q 25 A 26 177 Q 27 You have no copy of this trust deed? I haven't, no. None has been furnished to you from the Channel Islands? 28 A 29 178 Q No. Not 1 2 179 Q Subsequently the years passed, you received no 3 statements of those accounts, but at some stage 4 Mr. Traynor told you it was doing well? 5 A 6 180 Q 7 A 8 181 Q 9 Yes . And you understood, therefore, that it was growing? Yes . That interest was accumulating on it. In 1995, after Mr. Traynor's death, you wished to take back 10 your original investment and you didn't know who to 11 go to so you went to Mr. Carty, your accountant? 12 A 13 182 Q 14 A 15 183 Q Correct. He made enquiries on your behalf from Mr. Collery? Yes . At that point he discovered, and he told you, that 16 the trust was no longer in the Channel Islands but 17 was with Ansbacher Cayman; is that right? 18 A 19 184 Q What you told us earlier was that that was when you learned of it in 1995? 20 21 A 22 185 Q 23 Yes . He told you that he would be able to recover your investment for you? 24 A 25 186 Q 26 Yes . The next that you knew of it was when you received a cheque in the post for the sum; is that correct? 27 A 28 187 Q 29 I presume he must have. Correct. In the meantime, as far as you know, the interest that accumulated on that original £100,000 is still 1 there in the Cayman Islands and you were told what 2 it amounted to by your solicitor and we are not 3 concerned with the amount. 4 do about that now? 5 A. 6 188 Q. What do you propose to Leave it there for my nieces and nephews. Leave it there for your nieces and nephews, I see. 7 During the years between 1972 to date did you 8 declare to the Revenue Commissioners here in Ireland 9 the interest that was accruing on that £100,000? 10 A. 11 189 Q. 12 A. 13 No, because the trustees were the ones. You didn't declare it? I didn't declare it, no. MS. COSTELLO: Might I just have a brief 14 word with my client? MS. MACKEY: 15 16 A. 17 18 Certainly. The money that I put in was money I paid tax on, money I had got through Grassland Fertilizers 190 Q. MS. MACKEY: I was simply asking you 19 about the interest that 20 had accumulated. 21 original £100,000 how did you do it? 22 A. 23 191 Q. 24 A. When you were transferring the Over about a six month period. How was it done? Through Guinness & Mahon. I got a lot of export 25 dividends from Grassland and I had some money, I 26 mean I had been working thirty years at that stage 27 and we had a green grocers business and we had a bar 28 and what not. 29 192 Q. It is really the mechanics that I am interested in 1 of what you actually did in order to transfer it? 2 Just posted it to Guinness & Mahon. 3 193 Q 4 A 5 194 Q 6 A 7 195 Q In varying amounts over a period of six months? 8 A Roughly, I can't say whether it was six, seven, 9 196 Q 11 A 12 197 Q To Mr. Traynor himself? Yes . You would send him a cheque, from time to time? Yes . Would he acknowledge those cheques each time that he got them? 13 A No, I don't remember getting receipts from him or anything. 15 16 To Des Traynor. five . 10 14 To who in Guinness & Mahon? 198 Q 17 You didn't get any receipts. Would he acknowledge it on the telephone? 18 A 19 199 Q 20 A 21 200 Q He would acknowledge, yes, that he got the money. You were satisfied that...(INTERJECTION). I was satisfied that he had the money, yes. Once you had transferred it to Des Traynor as far as 22 you were concerned he looked after it after that, 23 was that it? 24 A 25 201 Q He looked after it after that, yes. During the years leading up to 1995, I think you 26 have answered this already, did you make any other 27 withdrawals from the trust fund at all? 28 A 29 202 Q No, only one withdrawal. Just the one? 1 2 203 Q. 3 4 Did you ever add, after the initial £100,000, did you ever add? A. 5 No, I didn't put any money in. MS. MACKEY: I have no further questions, Mr. Walsh, 6 7 thank you very much. 8 MR. ROWAN: Mr. Rowan may have some. Mr. 9 Walsh, we will have a break now for some coffee 10 and there will be some coffee supplied to you. We 11 are going to leave the room for ten minutes or so. 12 SHORT ADJOURNMENT 13 14 15 204 Q. MR. ROWAN: We will continue now. 16 Prior to getting this 17 document (Exhibit 2) I wanted to ask you whether 18 you, as an individual, had ever borrowed any money 19 from Guinness & Mahon? 20 A. No, never. From Guinness & Mahon, my company might, 21 Grassland might have, but I personally never 22 borrowed money from Guinness & Mahon. 23 205 Q. That was going to be my second question then, did 24 any of the companies with which you had an 25 involvement, borrow any money from Guinness & Mahon 26 or from Irish Intercontinental Bank in the '90's? 27 No, never, never used the money up there for any 28 purposes. 29 answer is no, I suppose, in short. We never had any reason to use it. The 1 206 Q The answer is no to any of the companies with which 2 you had an involvement, having borrowed money from 3 Guinness & Mahon? 4 A 5 That is correct. MR. GORE-GRIMES: He didn't say that. 6 7 MR. ROWAN: Sorry, then I misunderstood. 8 9 No, that is not correct. A Sorry, I didn't listen to your question. MR. GORE-GRIMES: 10 He said that Grassland Fertilizers had a normal 11 12 trading relationship with Guinness & Mahon in which 13 they borrowed monies, so it wouldn't be right to say 14 that no company with which he was associated. 15 207 Q MR. ROWAN: 16 Just for clarification, Grassland Fertilizers 17 borrowed money, from time to time, from Guinness & 18 Mahon? 19 A 20 208 Q 21 22 I would imagine so. Can you give me some more information about those loans to Grassland Fertilizers? A No, I wouldn't be able to, I would never be able to 23 give you information. 24 board, I wouldn't know, they were doing business 25 with Guinness & Mahon. 26 209 Q 27 A 28 210 Q 29 I was only a member of the You were an non-executive director? A non-executive director, correct. You became involved with Grassland Fertilizers in 1966? 1 2 3 was a family company 4 before, this man Arnold Suhr took the investment in 5 1966, the Walshs owned the company they started it 6 in 1964. 7 A We started it in 1964 and then sold a share to 8 Arnold Suhr. 9 MR. GORE-GRIMES: to this Swiss German, 10 Arnold Suhr. 11 12 So controlling interest 211 Q MR. ROWAN: 13 Well then if I may just look at this document 14 which you handed us just now, this document is a 15 letter from Guinness & Mahon dated 24th May, 2000 16 (Exhibit 2) and it is a letter to your solicitor and 17 it is a reference to P J Walsh, who is P J Walsh? 18 A 19 He is my brother. MR. GORE-GRIMES: be P & J. 20 21 212 Q 22 A 23 213 Q 24 A 25 MR. ROWAN: So it is P & J Walsh? Yes . So P & J Walsh is that a firm or a company? No, it is not, no, we were just individuals, that's all. 26 214 Q 27 A 28 215 Q 29 I think it is supposed to So, the P is your brother and the J is yourself? Correct. The pair of you made an application for a loan in 1986 and you got an approval to that and that is the 1 Yes . 2 3 216 Q This is an internal document, by the look of it, 4 from Guinness & Mahon, where you had applied for a 5 loan of £420,000? 6 A 7 217 Q Correct. With the purpose to take up your share of a £2 8 million 9 MR. GORE-GRIMES: Their share of. MR. ROWAN: I believe earlier it was 10 218 Q rights issue in Grassland Fertilizers? suggested that this loan 11 did not in fact take place? 12 13 A 14 15 No, it was never used, we sold our share in the company. 219 Q I see. You will see on the second page under a 16 heading called "security" you will see item one "P 17 and J Walsh considered adequate for this amount", do 18 you have any appreciation of the significance of 19 that comment? 20 A 21 22 23 24 25 We had £2 million there and we had our own business as well as security for it. 220 Q Yes, and on the main letter on the previous page in the first sentence it says: "I enclose here with copy loan approval dated 18th August, 1986 which shows that a loan of £420,000 for P and J Walsh was considered adequate." 26 27 That term "considered adequate" was a term which was 28 used by Guinness & Mahon and Ansbacher to indicate 29 that the organisation applying for the loan had a 1 relationship with someone who had a deposit with 2 Ansbacher. 3 & Mahon Parlands at the time. 4 MR. GORE-GRIMES: That is what that word means in Guinness 5 I think that is not quite right. Sorry to 6 interrupt, but I think the wording, because I have 7 been at the Moriarty Tribunal on many occasions, I 8 think "adequately secured" was the word that was 9 normally used the word "secured" was the word that 10 was important to them in their formula, "adequately 11 secured" or "considered adequately secured" I think 12 the word "secured" was always used in that formula, 13 as far as I remember. 14 MR. ROWAN: 15 If you go back to the previous page you will see 16 this is a reference to security. 17 MR. GORE-GRIMES: 18 reference to security, no 19 20 Of course it is a doubt. 221 Q MR. ROWAN: But in any event, Mr. Walsh, the loan did 21 22 not take place? 23 A 24 222 Q No. You indicated that when you were contemplating 25 creating the trust you talked it over with your 26 accountant in Kilkenny, Mr. Des Crowley. 27 was Mr. Crowley with, Mr. Walsh? 28 29 A His private company of his own. Which firm 1 His own firm. 2 fifteen years. 3 Also in the statement which you made to us, you 4 mentioned the issue of exchange control. 5 £100,000 was being transferred to the trust in the 6 Channel Islands, did you consider there was an issue 7 of exchange control approval needed at that time? 8 A 9 He is dead about I suppose ten, When the I would say that Des Traynor, I wouldn't know a lot about exchange control, it wouldn't mean a whole lot 10 to me. 11 business, as I said I was in school until 14 years 12 of age and I wouldn't know. 13 advised, but I didn't know anything about it. 14 225 Q 15 I wouldn't understand that part of the You might say I was So you didn't think about the issue of exchange control? 16 A 17 226 Q No, I didn't, no. And if there was such a requirement you would have 18 left that to Mr. Traynor? 19 Mr. Traynor, yes, he would have told me that, he was 20 my adviser at that stage, because he would have 21 known. 22 MR. GORE-GRIMES: 23 Mr. Rowan I just must say that I think in '71, '72 24 there was no question of exchange control as a fact, 25 so I don't think it is fair to put that question to 26 him. 27 sterling area so I don't think that it is a fair 28 question. 29 In '71 '72 the Channel Islands were in the 1 those were the points that 2 we just wanted to clarify, Mr. Walsh. 3 going to say? 4 A. You were I was going to say that one of the reasons, I have 5 no family and that was one of the reasons the trust 6 started in the first instance and my wife was looked 7 after even though I could have the trust, I wasn't 8 taking money from her, I had no family of my own. 9 My solicitor is continuing enquiring about it and 10 anything we get we will hand it over to you just 11 like we are after giving you this from Guinness & 12 Mahon, anything we get you will have it. 13 MR. ROWAN: We do appreciate that. 14 MR. GORE-GRIMES: We do intend to go after 15 it. 16 MS. MACKEY: 17 Thank you, we appreciate the co-operation. 18 MR. ROWAN: 19 We will have the interview transcribed and 20 Ms. Cummins will be in touch with you about that and 21 we will have to ask you to come in and sign it in 22 due course. 23 24 A. Yes. MR. ROWAN: Thank you very much. 25 26 27 28 29 THE INTERVIEW WAS THEN CONCLUDED ,0 7626a 3 (379 1.95030? 44745190 Wad/7? u_ r ' G O R E & G R I M E S -------------SOLICITORS------------CAVENDISH HOUSE. SMITHFIELD, DUBLIN 7 TEL: (01)872 9299 - 872 9744 FAX: 872 9877 D.D.E. BOX No. 62 E-Mail: solrs@goregrimes.ie o u r r ef: AGGVJL W01745.1 «*« WJ'" • The Inspectors Appointed to Examine the Affairs of Ansbacher (Cayman) Limited, ‘ 3rd Floor, Trident House, Blackrock, Co. Dublin. 3rd May, 2000 RE: JOSEPH WALSH ANSBACHER (CAYMAN) LIMITED ft HAY 2088 Dear Sire, I refer to my letter of the 23rd March, and have now had an opportunity of obtaining my client's instructions in relation to your letter of the 1* March. My client fs prepared to assist you In connection with your investigation to the best of his ability. ......... ....... It is noted that you require information under two headings:1. To establish the nature and extent of the Company's Irish business. 2. To establish whether or not the Company conducted its affairs to enable my client wrongfully to evade the payment of taxes which he was legally bound to pay. Please note that my client has not wrongfully evaded the payment of taxes and therefore the second part of your query does not arise In relation to him. My dienfs responses therefore will confined to dealing with the first part of your enquiry. My client does not have any documentation of any kind in relation to this matter but on his instructions I have written to Ansbacher (Cayman) Limited, and to Credit Suisse In Guernsey asking them to fUmish me with any information that may be relevant to the questions raised by you In Appendix C. w o i r w i / i o n E S -t i f i T The reason for writing to Credit Suisse Guernsey was that they took over College Trustees Limited and therefore might well have the documentation relating to the structure which might have been set up in Guernsey. My client has received a letter from Credit Suisse Trust on which they indicate that they cannot see any record of Mr Walsh having been a client of College Trustees Limited, and are unable to assist in providing the information which I requested. During a telephone conversation which I have had with Mr Brian Ellis of that company, he indicated to me that the matter might well have been dealt with by Guinness & Mahon Jersey Limited although that company has ceased to exist and he could not assist me as to where I could apply for information. I am now therefore writing to Guinness & Mahon Dublin for assistance. ^ I have not as yet received any response from Ansbacher (Cayman) Limited to my letter, but i telephoned them and was advised that a Trust was established on the 27th November 1989 in which the settlor was John Furze. The beneficiaries of the Trust are stated to be the British Red Cross or anyone who pays the sum of US$10 to the Cayman Island Branch of the British Red Cross. The Trust Is a discretionary one. They advised me that the Trust owns a company which was incorporated on the 28th of June 1989 in the Cayman Islands and is known as Drogheda Investments Limited. They advised me that they did not have a letter of wishes. My client has asked me to deal with the numbered paragraphs in Appendix C which are answered to the best of my client's knowledge at this time and subject to his obtaining other information .which he has requested:. 1. My client did not cause any Deed of Trust to be created in the Cayman Islands. He caused a Deed of Trust to be executed in the Channel Islands though he does not have any copy of this. (a) My client was not involved in any correspondence. (b) The only moneys which my client transferred were transferred to Guinness & Mahon Limited for onwards transmission by way of loan to the Channel Islands structure set up by Guinness & Mahon. It would not appear that this structure Included the Company which is the subject of your investigation. . (c) See reply to (b). (d) The only payment which my client received from the trust structure was the sum of £100,000.00 which I am instructed represented a repayment of a loan originally made by him to the Channel Island structure. (e) My client did not transfer any funds or assets as explained above. (f) As stated above my client understands that there is no letter of wishes In relation to the Cayman island Trust. (g) My client has no record of any correspondence. After Mr Traynor's death in 1994 my client was not sure who to contact in Guinness & Mahon. In 1995 he requested Mr Paul Carty of Deloitte & Touche to enquire from Guinness & Mahon of the person who would be dealing with the trust The instruction given by my client to obtain a repayment of the loan was given through Mr Paul Carty to Mr Padraig Collery. 2. My client was not aware of this service and did not avail of It 3. My client was not aware of this service and did not avail of it. 4. My client was not aware of this sen/ice and did not avail of it 5. My client was not aware of this service and did not avail of it 6. My client understands that Exchange Control permission was not required for the repayment of the £100,000.00 loan referred to above. This is the only financial transaction which my client had with the Company. The initial loan to the Channel Island trust structure does not appear to fall within the ambit of your enquiry. 7. My client was hot aware of these services and did not avaii of them. As stated above, my client dealt with Guinness & Mahon Limited and through them with their Channel Island structure. As stated above my client is writing to Guinness & Mahon Limited to see if they can throw any light on the Guinness & Mahon Jersey structure but of course this does not strictly fell within the ambit of your enquiries. 8. (a) My client is not aware of any body or corporation that fall within this category. (b) Ditto. (c) Ditto. (d) My client's position with regard to the Trust settled by Mr John Furze is as set out in the earlier part of this letter. nfirm that my client will attend at your offices oh Monday the 29th May at 10.00 i. and will be accompanied by myself and Ms Carollen Costello, B.L. Yours sincerely, . G U IN N E S S & M A H O N P R IV A T E BANKERS ^Gulmm t a Mahon Iratand)Ltd. 4 EarlsfortTarraca Dublin2 TOaphona 01 70S6200 Facsimile 01 7005210 Talax 93667 DubNnDocument Exchanga22 E-Mail InfoOgmbankJe http7Awvnv.gmbank.la Private & Confidential -Addressee Only Mr. Anthony Gore-Grimes, Gore & Grimes, Solicitors, Cavendish House, Smithfield, Dublin, 7. 24th M a y 2000 Our Ref C M a c C / M M Dear Mr. Gore-Grimes, Re: P.J. Walsh RaglataradOflloaaaabove RaglataradNo.looaaIraiand Amambaroftfx ' Parmanant Gtraup I enclose herewith copy loan approval dated 18th August 1986, which shows that a ban of £420,000 for P. & J. Walsh was considered adequate. At the present moment the Bank has not been able to locate any other documentation relating to any ofishore entity in connection with Mr. Walsh. Yours sincerely, l$£> Cathal MacCarthy, 1 Group Chief Legal Officer. +27: t: Amount: Purpose: . E) ()(y13725 Rate: Sacurity: Total Exposure: ?420,000 Loan (01: equivalant in any EH3 Fur-Irancy). To take up t?air share of a ?2m Rights Issue in Grassland Fertilizers, total rquiremanc ?570k. Walsh's awn 28.11 of the equity., 1 Year to 31.8;82. tram Sale of inveacmanta and/hr land. 005: +21 i l. P. &.J.wulah .canaidered adequate for this Amount. 2. Deposit of ahara certificates with blank transfers and power of sale over their 28.112 holding in Grassland Fertilizers Limited. Estimat value ?2.0m. ?420,000; rm , Kilkenny Co. Directors. Props, of P. Walsh & Sons Ltd., Kilkenny. R a t io n : Equity Stake: N o . C.B. Approval: Yes/No Permission Obtained Date: F C B I submitted. New Facility / (Delateasappropriate) ....Loan......... ‘Existing facilitiesoverleaf AMOUNT: _______ RATE: (or equivalent in any E.M;S.-C(lFf'6ftt'y)"-.... PURPOSE/DRAWDOWN: . ’o take up their share of a £2m. Rights Issue in Grassland .. ’ertilizprs, total requirement' £5.70k.-"Walsh's -own.28.1Z of ;^r«vequity. FEE: ........... + R.A.C. ........................... ..................... Ifnew or increased facilities,isdrawdown permitted priorto completion of security? YES/XXX REVIEW DATES: TERM OF FACILITIES: 1 year to 31.8.1987. . 31.8.87. SOURCE OF REPAYMENT; From sale of investments and or land. SECURITY: I. 2. F. & J. Walsh considered adequate for this amount.: ». . Deposit of share certificates with blank transfers and power of sale over their 28.1 % holding in Grassland Fertilizers Limited. Estimated value £2.0m+ Ifadditional or existing facility,issecurity Inorder? YES/NO IfNo, givedetailsseparately. ./"*s BACKGROUND NOTE/ OUTLINE OF PROPOSAL: Hie Walsh’s are taking up their rights in the proposed rights issue to avoid dilution of their jolding which would result in their losing their right to have two Directors on the Board of jrassland. The family company, D. Walsh & Sons, is substantial and they have close links vlth Avonmore and Waterford Co-Op. Recommended. • •*' A ppendix X V (133) M r Ivan W ebb, deceased 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Ivan Webb. a) Transcript of evidence of Mrs Valerie Webb dated 29 March 2001. b) Statement of Mrs Valarie Webb dated 25 February 2001. c) Letter of 18 August 1971 - Kennedy Crowley & Co to Mr John Ronan. d) Letter of 8 March 1972 - Kennedy Crowley & Co to Mr George Crampton. e) Guinness and Mahon statement o f 29 July 1983 re Mrs V Webb. f) Ansbacher Limited statement o f 3 October 1994 re a/c A/A47. g) Ansbacher Cayman Limited statement of 31 December 1991 re a/c A/A47. h) Copy statement of 8 November 1989 re Mrs V Webb. i) Ansbacher Limited statement o f 12 October 1993 re a/c A/A47. Appendix- ?(13310) PRIVATE EXAMINATION OF MRS. VALERIE WEBB UNDER AFFIRMATION ON THURSDAY, 29TH MARCH 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: JUDGE S. O'LEARY MS. N. MACKEY BL Solicitor to the Inspectors: MS. F. GAYNOR Interviewee: MRS. V. WEBB Instructed by: MR. T. O'GRADY MATTHESON ORMSBY PRENTICE SOLICITORS 1 2 FOLLOWS ON THURSDAY, 29TH MARCH 2001: 3 4 5 1 Q. JUDGE O'LEARY: Good afternoon, my name is 6 Sean O'Leary. I am one of 7 the Inspectors. 8 Ms. Mackey is with me today. 9 Inspectors are not involved in your side of the There are four Inspectors. The other two 10 business, if there is any side at all so any 11 decision that would be taken will be taken by the 12 two of us that are here today. 13 that? 14 A. 15 2 Q. Do you understand Yes. This is an information gathering exercise. The 16 purpose of it is quite simple: 17 to investigate a company called Ansbacher Ltd, a 18 Cayman Island company which had a number of other 19 different names including Guinness Mahon Cayman 20 Trust or GMCT. 21 that company. 22 asked us to do is to establish who the Irish clients 23 of the company were. 24 that any of the Irish clients did anything wrong. 25 That is a different matter all together. 26 involved in that side of it at all. 27 trying to find out is who were the clients of the 28 company in Ireland of this Ansbacher or Guinness 29 Mahon Cayman Trust. We have been asked We have been asked to investigate One of the things the High Court has That is of course not saying We are not All we are 1 2 You are just one person that came in. 3 informal situation. 4 position is and ask your recollection of it, if you 5 have any recollection of it. 6 of it. 7 formal portion of the procedure is the administering 8 of the oath. 9 the oath. 10 A. 11 3 Q. 12 A. 13 4 Q. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 It is a very We will explain to you what the A note will be taken It is a very informal procedure. The only I would ask Ms. Mackey to administer I am not going to swear on a bible. You can affirm. I am not a believer I am afraid. That is grand. You are perfectly entitled. 1 2 3 4 5 Q. JUDGE O'LEARY: You are very welcome 5 indeed. We note that you 6 have a solicitor with you and we are very happy to 7 see that you have a solicitor with you. 8 during the course of the consultation if you want to 9 consult with your solicitor, you can stop and say At any time 10 'Would you hold on a second, I would like to talk to 11 my solicitor' and we will withdraw from the room and 12 let you consult with him. 13 solicitor feels at any time that he would like to 14 consult with you, all he has to do is to say to us 15 'Would you please stop' and we will stop and go 16 outside the room. 17 A. 18 6 Q. Similarly if your Do you understand? Yes. Feel perfectly free to use his facilities in that 19 way during the course of the interview. 20 Mrs. Webb, the first thing I would ask you are a few 21 background details. 22 married to a man by the name of Webb, is that 23 correct? 24 A. 25 7 Q 26 A 27 8 Q 28 A 29 9 Q We understand that you were That's right. What was his first name? Ivan. He died sometime ago, Mrs. Webb, didn't he? Yes . 1 2 A. 3 10 Q. 4 That's right. What time of the year in 1972 did he die do you remember? 5 A. 6 11 Q. 7 A. 8 12 Q. 9 A. 10 13 Q. 11 A. 12 14 Q. 13 A. 14 15 Q. 15 A. 16 16 Q. 17 A. 18 17 Q. 19 June I think. What did Mr. Ivan Webb do for a living? He was in Cramptons builders. He was an executive there? He was the managing director. Was he actually the manager director? Yes. That was a responsible position obviously? Yes. He must have been comparatively young when he died? He was a lot older than me. He died in 1972? Yes. Before he died were you aware as to whether he had any money on deposit overseas? 20 A. 21 18 Q. 22 A. 23 19 Q. 24 No. You knew nothing about that? No. Did you know anything about the existence of any trusts overseas at that time? 25 A. 26 20 Q. 27 No. So you had no information with regard to those matters ? 28 A. 29 21 Q. No. And I suppose in the normal way his estate was 1 administered and distributed in whatever way he 2 wished in his will, is that correct? 3 4 22 Q. 5 you remember? 6 A. 7 23 Q. 8 A. 9 10 Who was the executor or executrix of his will, do I don't know. It wasn't you? I don't know, I don't remember. It is nearly 30 years ago. 24 Q. 11 Do the names Clarke, Seymour, Sidney East and George Crampton mean anything to you? 12 A. 13 25 Q. 14 Yes, they were all directors of the company. We have Mr. George Crampton. We have Mr. Clarke, Mr. Seymour, Mr. J Sidney East and Mr. Ivan Webb? 15 A. 16 26 Q. Yes. You obviously know a little about that so I am going 17 to show you a letter at page 62 -- Exhibit 1 -­ 18 which was written a few months before your husband 19 died. 20 names of the other directors are in there as well. 21 We normally don't show other names to people but 22 because this is something that happened between the 23 six of them, we feel that it is only right and 24 proper that we should be open and frank with you and 25 give you all the information. 26 to mention the other names to anybody. 27 understand? 28 A. 29 27 Q. Could I first of all say to you that the But we don't want you Do you Yes. Except your solicitor. Obviously it is private. 1 2 letter? 3 JUDGE O'LEARY: Of course, absolutely. 4 In fact I will read the 5 relevant portions of it to you and it might help you 6 because it is not easy to read when you are under a 7 little bit of scrutiny. 8 & Co. Chartered Accountants. 9 Islands Trust." It is from Kennedy Crowley It says: "Re: Cayman It is addressed to a man by the 10 name of John Ronan who was a solicitor himself I 11 think. 12 13 14 15 16 17 18 19 20 It says: "Dear John, In the course of discussions which I had on Friday with Messrs. George Crampton and Don O'Connor I was asked to write to you asking you to advise them and Messrs. S. Clarke, S. Seymour, J. Sidney East and I. Webb regarding the establishment of discretionary trusts in the Cayman Islands. I had already sent you for general information a draft of a trust deed which is used in the Cayman Islands and the above-named would like to you advise them as a group on the suitability of such a trust deed for their purposes but at a later stage reference will of course be necessary to the individual reguirements of each. 21 22 23 In the first instance they would wish to have written advice and at a later stage they would like to discuss this written advice with you at some suitable occasion when you are in town. 24 25 26 27 28 29 As you know from your other connections these trusts will be the recipients ultimately of certain tax free profits in the Cayman Islands and the anxiety is that the arrangements should be as flexible as possible, consistent with the continuing tax free status of the trust and of appointments made by the trustees to the beneficiaries of the trust. 1 I have already given you some comment on the general features the trust deed and if you feel a further discussion would be helpful please let me know. 2 3 4 I am sending a copy of this letter to Mr. G.C. Crampton. 5 Yours sincerely, D. Reid." 6 7 Over the page it says: 8 "I would like to mention that in each case the settler would be a Cayman Islands resident and appointor would be the appropriate individual named above." 9 10 11 12 That was a scheme which was being put in place at 13 that time. 14 actually was implemented. 15 other people that the scheme was implemented. 16 Unfortunately it was implemented around March 1972 17 and your husband was still alive at that stage and 18 you don't know anything about it, is that correct? 19 A. 20 28 Q. We have information that the scheme We have evidence from the Yes. After your husband's death when was the first time 21 that you got to know that there might be money 22 somewhere offshore for you? 23 A. 24 29 Q. 25 A. No, I knew I had money in Guinness & Mahon. 26 30 Q. But you had an account in Guinness & Mahon? 27 A. 28 31 Q. 29 I don't know. Did you ever get a note? Yes. But you showed us the account in Guinness & Mahon. 1 Mahon. 2 of money which were drawn out from time to time? 3 A. 4 32 Q. 5 A. 6 33 Q. 7 A. 8 34 Q. 9 A. 10 35 Q. 11 That is only what I would call small amounts Yes. But there was a lump sum of money somewhere? I didn't know anything about that. You didn't know? No. But of course you accept that there was such money? Yes. Do you accept that there was such money? MR. O'GRADY: 12 13 If I could have a brief word with my client? JUDGE O'LEARY: 14 Certainly. You might refer your client to the 15 contents of her statement? 16 MR. O'GRADY: Sure, absolutely. 17 M R . O' LEARY: Which is consistent with 18 the question I am asking? 19 MR. O'GRADY: Indeed. 20 JUDGE O'LEARY: We will leave for a few 21 minutes. 22 23 24 25 26 27 28 29 SHORT ADJOURNMENT 1 36 Q. JUDGE O'LEARY: 2 Getting back to the question after your 3 husband died, after sometime you became aware that 4 funds were available, 5 A. 6 37 Q. 7 A. 8 38 Q. 9 A. 10 39 Q. 11 A. 12 40 Q. 13 is that correct? Yes. Who told you that? I don't know, somebody from the company I suppose. Would it have been Sidney Seymour? Yes, probably. He was the man that you had most contact with? Yes. You might like to refer to your statement. In your statement you said: 14 "In the mid 1970's I was made aware by Sidney Seymour, a director of Cramptons, of the existence of a fund invested by Cramptons for my benefit. I was informed that the source of funds was the proceeds of a sale by Cramptons." 15 16 17 18 19 Is that correct? 20 A. 21 41 Q. 22 23 24 25 26 I don't know. It goes on to say: "I contacted Mr. Seymour on a number of occasions. I was informed that if I needed access to the funds I was to contact Mr. Seymour. I contacted Mr. Seymour on a number of occasions between 1980 and 1994 and Mr. Seymour arranged for monies to be lodged to my current account set up for me in the bank." 27 28 29 Is that correct? 1 2 42 Q. 3 A. 4 5 Yes, but how did the money come into that account? I don't know; I didn't give it much thought. I didn't think about it. 43 Q. I don't understand that. Here you are, you are 6 getting money into an account and you are saying you 7 didn't think about it? 8 A. 9 4 4 Q. I don't know, it was just money there. "Just money there." I see. Do you remember in 10 October 1994 you received a sum of £70,590. 11 remember that? 12 A. 13 45 Q. 14 A. 15 4 6 Q. 16 Yes. Who did you get that from? I don't know where it came from. Yes, but who did you get it from; who handed it over to you? 17 A. 18 47 Q. 19 A. 20 4 8 Q. 21 Somebody dealt with it for me. Who dealt with it for you? Don Reid. That is the gentlemen who was in Stokes Kennedy Crowley? 22 A. 23 49 Q. 24 25 Do you Pardon. That is the accountant that was in Stokes Kennedy Crowley, is that correct? A. 26 I don't know where he was, I just know him. I met him once. 27 50 Q. 28 A. 29 51 Q. How did he deal with it for you? I don't know. Did he come along to you and say 'By the way, 1 Mrs. Webb, I have some good news for you. 2 £70,000 to give you' or did you contact him to say 3 'Look, there is some money somewhere for me. 4 you deal with it for m e . ' ? 5 A. 6 52 Q. 7 A. 8 I have Would Yes. What happened? I wanted to have the money in my own control instead of having to ask somebody all the time for it. 9 53 Q. 10 A. 11 54 Q. 12 A. 13 55 Q. 14 A. 15 56 Q. What did you do? So he got the money. But did you ask him to did that? Yes. Where did you think the money was? I didn't know. When this money was being given to you at various 16 times over the years, who would have told you 17 'The money has arrived in the account now and you 18 can use it?' 19 A. 20 57 Q. 21 I don't know what you mean? Earlier on, before you got the £70,000 you got some other money? 22 A. 23 58 Q. 24 A. 25 59 Q. 26 A. 27 60 Q. Yes. Do you remember how much else you got? No. Do you remember who you asked for the money? Yes, I asked Sidney Seymour. Did you say 'Mr. Seymour, I would like £10,000' or 28 did you say 'Mr. Seymour, I would like as much as 29 you can afford.' How did you put the request to 1 2 A. 3 I would say £5,000 or £10,000. I never wanted very much money. 4 61 Q. 5 A. 6 62 Q. 7 A. 8 63 Q. 9 A. 10 64 Q. 11 A. 12 65 Q. You would say to him you wanted £5,000 or £10,000? Yes. Or whatever it was? Whatever it was, yes. He would make the necessary arrangements? Yes, I presume so. Did you ever receive a statement showing this money? No. You have given us statements which you got from 13 Guinness & Mahon. 14 straightforward? 15 A. 16 66 Q. They are unremarkable; they are Yes. The only thing that is a little bit unusual about it 17 is, for example at page 27 -- Exhibit 2. 18 give you my own page. 19 sum of £2000 goes into that account there. 20 look at it there. 21 lodgement of £ 2000 ? 22 A. 23 67 Q. 24 A. 25 68 Q. 26 A. 27 69 Q. 28 A. 29 70 Q. I will (Same handed) You see that a You can You see where there is a Yes. It says it comes from a deposit account? Yes. Did you have a deposit account as well? No. You never had a deposit account? No. You had only one account in Guinness & Mahon? 1 2 71 Q. 3 A. 4 72 Q. 5 When did you open that account, Mrs. Webb? I don't know, I don't remember. Was it before or after your husband died do you think? 6 A. 7 73 Q. It must have been after. Was the purpose of opening that account so that you 8 could receive the monies from Mr. Seymour from time 9 to time? 10 A. 11 74 Q. 12 A. 13 75 Q. 14 A. 15 7 6 Q. Yes. Was that the only purpose of the account? Yes. Did you do your general banking elsewhere? I did. When you got your money out in 1994 which was some 16 £70,000, do you remember what you did with it at 17 that time? 18 A. 19 77 Q. 20 Yes, I put it in the post office. Why did you put it in the post office as distinct from anything else? 21 A. 22 78 Q. I think it was as good a rate as anywhere else. What I am going to do is show you two documents. 23 Do you remember the date on which you put the money 24 into the post office? 25 A. 26 79 Q. 27 No. I wonder is it in your statement. We will look at that now and see if it is in your statement? 28 A. 29 80 Q. It says here in October 1994. I will give you page 26 -- Exhibit 3. 1 Mrs. Webb, you see there that in a bank statement -­ 2 forget for the moment who the bank statement is -­ 3 it is in the name of Hamilton Ross. 4 on the left-hand side? 5 A. 6 81 Q. Do you see that Yes. You see that a sum -- not identical to it because 7 the rates of exchange would be different -- of 8 £70,167 in Sterling is transferred to An Post? 9 A. 10 82 Q. 11 Yes. In a note immediately adjacent to i t ...I will read it across for you: 12 "3rd October 1994. Value date 30th September 1994. IR £70,590." 13 14 Do you see that? 15 A. 16 83 Q. Yes. That is precisely the amount of Irish punts that 17 were lodged to the post office by you, £70,590. 18 In fact it was £70,167 Sterling but it was £70,590 19 Irish punts. 20 A. 21 84 Q. 22 A. 23 85 Q. 24 Do you see that? Yes. That is the money that was transferred to you? Yes. Do you see up on the right-hand side that there is a reference "A/A47." 25 A. 26 86 Q. 27 Do you see that? Yes. The system that they used in Ansbacher wasn't a system of names but a system of numbers? 28 A. 29 87 Q. Yes. That is a particular number, A/A47. Put that to one 1 side for a second. 2 earlier document -- Exhibit 4. 3 witness) 4 It looks the same but on this occasion the word 5 "Ansbacher" appears. 6 A. 7 88 Q. I now want to show you an (Same handed to Do you see that? Yes. Ansbacher Ltd and Ansbacher Cayman. You can see 8 that the amount in there is approximately £72,000 or 9 £73,000. It is a slightly different time because of 10 course this was two years earlier. 11 to the right-hand side, in the place where I pointed 12 out A/A47 you see that appears on that as well? 13 A. 14 89 Q. But if you look Yes. We have received evidence from various bank 15 officials and others that Ansbacher's accounts were 16 changed to Hamilton Ross around that time. 17 Do understand that? 18 A. 19 90 Q. Yes. It appears clear that the money which you received 20 from this Hamilton Ross company originally was in 21 Ansbacher. 22 A. 23 91 Q. 24 A. 25 92 Q. 26 A. 27 93 Q. 28 A. 29 94 Q. Have you any comment to make about that? No. Mrs. Webb, did you ever get interest from them? From who? From wherever the money was on deposit? I don't know. You just got money? Yes. Did anyone ever say to you 'Mrs. Webb, you have this 1 money out there and you better return it for tax 2 purposes ?' 3 4 95 Q. 5 A. 6 96 Q. 7 A. 8 97 Q. 9 Nobody ever said that to you? No. Or you were never informed about that? No. During the time that you were getting this money from Mr. Seymour from time to time, where did you 10 think the money was coming from? 11 A. 12 98 Q. I don't know. You must have thought about it. We don't all get 13 £5,000 or £10,000 from time to time from people 14 without saying when or where it came from? 15 A. I thought it must have been somebody. 16 didn't give it much thought. 17 lot of money. 18 99 Q. 19 I really There wasn't an awful I didn't spend much money. I understand that but I am trying to find out where you thought it was coming from? 20 A. 21 100 Q. I didn't think. You had no idea. I will now show you, Mrs. Webb, 22 page 64 -- Exhibit 5. 23 another letter from the same Don Reid. 24 remember that I showed you an earlier letter. 25 is a later letter from Don Reid. 26 letter for completeness. 27 28 29 Funnily enough that is Do you This I will read the It says: "Dear Mr. Crampton, I am sorry that it has taken me rather longer to come back to you with a draft Letter of Wishes. I am now enclosing six copies of this draft so that it may be considered by each of the 1 individuals concerned. I think that the terms of the letter are fairly self-explanatory and should not give rise to any problems but, should anyone wish to discuss it with me I would be happy to do so. 2 3 4 Since I saw you we have sent to the Cayman Islands the revised draft Trust Deed together with the details required to complete the appointed class in each case. 5 6 7 For ease of reference and to avoid too much identification we are calling the Trusts the Whitethorn Trusts. Your own will be Whitethorn A Trust, Mr. Clark's the Whitethorn B Trust, Mr. East's the Whitethorn C Trust, Mr. O'Connor's the Whitethorn D Trust, Mr. Seymour's the Whitethorn E Trust and Mr. Webb's the Whitethorn F Trust. 8 9 10 11 12 18 As soon as the trusts are drawn up I will have the Letter of Wishes signed in each case by Paul Harris who is the settlor. Two formal steps will then remain to be taken. The first is the formation by the Trustees of a company (or companies) to receive income from deposits and investments on behalf of the Trustees. The second will be the execution by Paul Harris of a Deed (in blank) assigning his powers as Appointor of the Trusts. 19 Yours sincerely, Don Reid." 13 14 15 16 17 20 21 That shows that the scheme was implemented? 22 A. 23 101 Q. 24 Yes. And that your husband was the beneficiary or was the man who established the Whitethorn F Trust? 25 A. 26 102 Q. Yes. The only bit of your evidence which puzzles me, and 27 you would be the surprised that the rest of it 28 doesn't puzzle me at all. 29 evidence that puzzle me is, of all the people in the The only piece of this 1 whole world that you went to for advice 22 years 2 later when you wanted to get your hands on the 3 money, you happened to go to Mr. Don Reid who was 4 the man who established the trust. 5 something? 6 I must have asked somebody. 7 103 Q 8 Isn't that You didn't say that before, Mrs. Webb. You must have asked somebody but who did you ask? 9 A 10 104 Q 11 George Crampton I suppose. Mrs. Webb, do you understand the meaning of being economical with the truth? 12 A 13 105 Q I do, yes. It normally refers to witnesses who while not 14 telling any lie, do not volunteer any information. 15 Do you understand? 16 A 17 106 Q Yes . When I asked you about Mr. Reid previously I venture 18 to suggest that you were economical with the truth. 19 You must have sought advice from somebody. 20 say it was Mr. Crampton. 21 conversation with Mr. Crampton? 22 A 23 107 Q Now you Do you remember the No. I have no further questions. 24 25 26 27 28 29 END OF EXAMINATION OF MRS. WEBB BY JUDGE O'LEARY 1 2 I would like to clarify 3 with you, Mrs. Webb. 4 lodgements to this fund or add anything to it? 5 A 6 109 Q Did you yourself make any No. The Guinness & Mahon account, the statements that 7 you sent us begin in 1980. 8 statement that you learned of the existence of this 9 fund sometime in the mid 1970's. You told us in your own Indeed we have 10 seen from the documents that we have been showing 11 you now that it was set up in 1972. 12 did you access the money. 13 from the fund if you wanted it before you had your 14 Guinness & Mahon account? 15 A 16 110 Q 17 A 18 111 Q 19 A 20 112 Q I don't know. Up to 1980 how How did you get payments Did I get any, I don't know? Did you, I am asking you? I don't know. Mr. Seymour told you about it in the mid 1970's? Yes . This is what you say in your statement; I am going 21 by your statement. 22 then until 1980 you didn't access the money at all? 23 A 24 25 I presume, yes. Is it your evidence that from I have no recollection of that at all. 113 Q In fact is your recollection that the only way that 26 you accessed the money was through this Guinness & 27 Mahon account? 28 A 29 114 Q Yes . It was open especially so that the money could be 21 1 2 3 115 Q. The Guinness & Mahon account, again from the 4 statements that you have shown us, closed in 5 November 1989. 6 because we have evidence that you certainly got at 7 least £10,000 in 1992. 8 Guinness & Mahon account closed. 9 payments go to for you after that? 10 A. 11 116 Q. How did you get payments after that So what did you do after the I don't know. You don't know but you got payments, isn't that 12 correct? 13 from the fund after 1989. 14 last statement? 15 A. 16 17 Where did the You were able to continue to draw money Maybe I will show you the I don't recall drawing any money except from Guinness & Mahon. 117 Q. Perhaps there was another account opened. What you 18 have shown us here, unless I am mistaken -­ 19 Exhibit 6 -- you have sent us copies of your 20 resident current account up to 8th November 1989 at 21 which time there was £1,050 and 74 pence. 22 we see a nil balance after that so it looks as if it 23 was closed when that was withdrawn, doesn't it? 24 A. 25 118 Q. 26 A. 27 119 Q. And then Yes. That was 1989? Yes. You appear to have no Guinness & Mahon account after 28 that unless another one was opened. 29 last thing you have given us. But that is the If I could refer then 1 to these A/A47 statements that you were looking at 2 earlier at page 87 -- Exhibit 7 3 JUDGE O'LEARY: 4 earlier statement of the 5 6 That, Mrs. Webb, is an series that I already showed you examples of. 120 Q. MS. MACKEY: 7 With the name Hamilton Ross. 8 A. 9 121 Q. You see A/A47? Yes. You see there that a sum of £10,000 Irish equalling 10 £9,600 Sterling was withdrawn from that account. 11 The date is very hard to read because the 12 photocopying is bad, but it is actually some date in 13 1993. 14 Do you see that? 15 A. 16 122 Q. You see beside it there 12th October 1993. Yes. So a sum of £10,000 was withdrawn and presumably it 17 can only have been withdrawn by yourself through 18 whoever you got to do it for you, Mr. Seymour or 19 Mr. Reid, I don't know. 20 was paid to you because the Guinness & Mahon account 21 was closed at that time. 22 example getting money in cash at any stage from 23 Mr. Reid or Mr. Seymour? 24 A. 25 123 Q. 26 A. 27 124 Q. But I am wondering how that Do you recollect for No. Or a bank draft? No. I am wondering where this £10,000 went to. 28 1993 before you withdrew the final lump sum. 29 that ring any bell? That is Does 1 2 125 Q. 3 Getting back to the business of Mr. Seymour and Mr. Reid -- Mr. Seymour died in 1993? 4 A. 5 126 Q. I don't know what year he died. He died in 1992 or 1993. It was before you withdrew 6 your lump sum. 7 to Mr. Crampton to ask how you would now access the 8 money? 9 A. 10 127 Q. Was it after his death that you went I don't remember. Can you recollect when you first spoke to Mr. Reid 11 about it roughly. 12 date? 13 A. 14 128 Q. 15 A. 17 12 9 Q. 18 A. 19 Was it towards the end or had you been in contact I don't remember. You do remember talking to Mr. Reid about it? I do remember talking to him. That was at the time (he told me) to put it in the post office. 20 130 Q. 21 A. 22 Is that the only time you spoke to him? It is the only time I remember; I could have spoken to him before. 131 Q. 24 That was as a result of Mr. Crampton suggesting to you that he was the best person to go to? 25 A. 26 132 Q. 27 A. 28 133 Q. 29 No. with him about it for some years? 16 23 I am not looking for an exact Yes. Mr. Seymour of course was not alive at that stage? No. During Mr. Seymour's lifetime, every time you wanted 1 2 134 Q 3 Did you contact anybody in Guinness & Mahon ever about it? 4 A 5 135 Q 6 No. Did you ever have any contact with Mr. Desmond Traynor? 7 A 8 136 Q 9 A 10 137 Q 11 A 12 138 Q 13 A 14 139 Q 15 A 16 140 Q 17 No. Or Mr. Padraig Collery? No. Or Mr. Martin Keane? No. Nobody in Guinness & Mahon? I have heard of them. But you haven't met any of them? No. Did Mr. Collery himself ever contact you about your funds ? 18 A 19 141 Q 20 A 21 142 Q 22 A 23 143 Q Mr. Who? Padraig Collery? No. He never made any contact with you? No. You say in your statement, Mrs. Webb, if you could 24 have a look at it again there -- do you recall 25 making this statement. 26 or your solicitor, this statement that has been sent 27 into us. 28 your solicitor? 29 Was it you who wrote it out Mrs. Webb, was it you who wrote it out or 1 Did you give your solicitor instructions or was it 2 your daughter who gave the instructions because you 3 seem to be unfamiliar with some of the things that 4 are said in it, that is why I wonder. 5 down with your solicitor and tell him these things 6 or did your daughter, Mrs. Webb. 7 MR. O'GRADY: 8 there is no point in beating around the bush? 9 MS. MACKEY: Perhaps. MR. O'GRADY: What happened was that I 10 Did you sit I can clarify if you wish; 11 met Mrs. Webb's daughter. 12 A statement was drafted based on the information 13 that we had and it was sent out to Mrs. Webb. 14 MS. MACKEY: That you had from her daughter? 15 16 MR. O'GRADY: From her daughter and from 17 the papers that I have 18 which you have seen from the statements. 19 MS. MACKEY: Statements such as the 20 contact with Mr. Seymour 21 which Mrs. Webb seemed vague about? 22 MR. O'GRADY: I drafted it. 23 It was sent out to Mrs. Webb's 24 daughter. 25 discussed it with Mrs. Webb and some changes were 26 made arising from that. 27 MS. MACKEY: 28 29 As I understand it Mrs. Webb's daughter And then it was sent out. But in fact it was Mrs. Webb's daughter who came in to see you initially and talked with you 1 2 MR. O'GRADY: Yes, who came in to see 3 me. 4 MS. MACKEY: If we could look at the 5 second page of that 6 statement, Mrs. Webb. 7 page in the third sentence down you say: 8 Up at the top of the second "I had been informed that the funds from which monies were lodged to my current account with the bank were set up as part of a legitimate tax scheme." 9 10 11 Do you see that? 12 A 13 146 Q 14 A 15 147 Q Yes . Who informed you of that, Mrs. Webb? I must have been Don Reid again. So you only spoke to Don Reid at the end of the 16 whole thing. 17 he told you it was legitimate, is that right? 18 A 19 148 Q 20 Yes, I suppose so. And was that as a result of you asking him was it legitimate. 21 A 22 149 Q So you are saying that at that stage Had you expressed some worry to him? No. It is important that we know at what stage Mr. Reid 23 said that to you, whether he told you that in 1994 24 when you spoke to him or whether you had some 25 conversation with him in 1972 when he told you that 26 then. 27 beginning or the end of the thing that he said to 28 you if it was he who said it? 29 It is important to know whether it was at the 1 150 Q 2 or the very end? 3 A 4 151 Q 5 6 You cannot remember whether it was at the very start No. Do you recollect at all meeting Mr. Reid at the very start at the times...(INTERJECTION)? A 7 No, I only recollect meeting him once. That was the time he advised me to put it into the post office. 8 152 Q 9 A 10 153 Q 11 Did he advise you to put it into the post office? Yes . I was actually going to ask you about that because you had a bank account somewhere else I presume? 12 A 13 154 Q 14 Yes . Did you at that stage have an account with the post office? 15 A 16 155 Q 17 No. But Mr. Reid thought it wise for you to open one and put this in? 18 A 19 156 Q 20 A 21 157 Q Yes . It was on his advise? Better interest I think. Those are all the questions. 22 questions, Mrs. Webb. 23 JUDGE O'LEARY: 24 I have no further Thank you very much. Thank you very much indeed. What happens now 25 is the transcript has been taken of your evidence 26 and in due course you will be invited to sign that 27 as accurate. 28 accurate. 29 And to what extent or what we will say, we have no To read it and make sure it is Then we will make a report in due course. 1 idea. 2 3 any conclusions that may 4 be adverse to your interest, we will write to you 5 first before any report is published telling you 6 exactly what they are and you will be given an 7 opportunity to comment on them, to give us further 8 explanations, to give further evidence if you wish 9 to do so or all of that. In other words, to contest 10 it before any report is written if that is what you 11 want to do and if in fact any such conclusions are 12 drawn at this stage. 13 JUDGE O'LEARY: 14 We have an open mind. We don't know what we are 15 going to do. 16 MR. O'GRADY: 17 Can we take copies of those documents? 18 JUDGE O'LEARY: There is no difficulty. 19 MS. MACKEY: You can have those. 20 Those are copies. You may 21 keep those and they will also be appended to the 22 transcript in due course. 23 24 25 26 27 28 29 END OF INTERVIEW WITH MRS. VALERIE WEBB Man: 5 a: $23406? YNAMN a? sum cw; 4 prndeV(l33)Was, I IN THE MATTER OF THE COMPANIES ACT, 1963 -1999 AND IN THE MATTER PART n OF THE COMPANIES ACT, 1990 AND SECTIONS 8 AND 17 AND IN THE MATTER OF ANSBACHER (CAYMAN) LjfMITED (FORMERLY GUINNESS MAHON CAYMAN TRUST LIMITED, ANSBACHER LIMITED AND CAYMAN INTERNATIONAL BANK AND TRUST COMPANY LIMITED) STATEMENT OF VALERIE WEBB A. By letter dated 30 January 2001 (the “Inspectors’ Letter”) addressed to me and signed by His Honour Judge Sean O’Leary, Noreen Mackey BL, Mr Paul Rowan and Michael Cush SC (the “Inspectors”) appointed by the High Court to Ansbacher (Cayman) Limited (the “Company”) I have been requested to provide an unsworn statement in relation to the matters set out in appendix C (“Appendix C”) to the Inspectors’ Letter. B. I have never, to the best of my knowledge, had any dealings with the Company. C. Because I have not, to the best of my knowledge, had any dealings with the Company, I do not have any books or documents in my custody or power relating to the Company. D. I have in the past had dealings with Guinness & Mahon Limited (the “Bank”). E. My late husband Ivan Webb was employed by the Crampton Builders Group (“Cramptons”). He died in 1972. In the mid-1970’s I was made aware by Sidney Seymour, a director of Cramptons, of the existence of a fund invested by Cramptons for my benefit. I was informed that the source of the funds was the proceeds of sale of a site by Cramptons. I was informed also that if I needed access to any of the funds I was to contact Mr Seymour. I contacted Mr ... Seymour on a number of occasions between 1980 and 1994 and Mr Seymour arranged for monies to be lodged to the current account set up for me at the Bank. To the best of my recollection, I never attended at the Bank in person. I received cheque books from time to time by post. I do not have any of the cheques or cheque stubs in my possession. I wrote to the Bank and received copies of all statements in August 2000. Although I am not aware that there was any connection between my bank account, or the source of the funds put into same, and the Company, I enclose copies of all of the bank statements in question. I received a cheque in October 1994 for the sum of £70,590, which I assumed represented the balance of the investment and which monies were lodged with An Post. I attach also a statement of account reflecting the said cheque payment, which I received from the Revenue i Commissioners recently. I had been informed that the fund from which monies were lodged to my current account with the Bank was set up as part of a legitimate tax scheme, and on that basis I was not aware that I would have any outstanding tax liability to the Revenue Commissioners. F. Upon my receipt of the bank statements I wrote to the Bank and enquired, as indeed did , on my behalf, in relation to two lodgements, one described as being from “whitet trust" and the other as account number “06249000”. The response received was that the lodgements looked as though they related to monies lodged to the account on maturity of a certificate of deposit. The Bank indicated that it should be possible to see the monies going out of the current account into the certificate of deposit some months previously. I have no recollection of purchasing a certificate of deposit and the bank statements would not appear to bear out what the Bank indicated. I do not recall anything about any such certificate of deposit. Signed : VALERIE WEBB Dated day of \M OP_D U BLIN\325704.1 2001 - V . f. : J ' f A i i, • . • Kennedy Crowley &Co. Chartered Accountants * Hainaalt House / 1 St Stephen's Green Dublin 8 Telephone 757971 69 7 John Horun K.q., H I .Itonan & Sons, 94/95 Soueh Mall, Cork’ o . ■ Rif: • urn* n*te:13 August 1971 re: Cayman Islands trust Dear John, ra/A • - * 'In the course of discussions which I bad on Friday with Messrs. ‘ . ’ X m i asked to writs to you asking you to advise then and Messrs. and I. Vebb regarding the establishment of discretionary trusts . in the Cayaan Islands. I had already sent you for general information a draft of a trust dead which is used in tha Caynan Islands and the above naiied would like you to advise them as a group on tha suitability of such a trust deed for their purposes but at a later stage -^ e feressc will of course be necessary to tbe individual requirements of each. In tbe first Instance they would wish to have written advice and at a later stage they would like to discuss this written advice with you on some suitable occasion when you are in town. . As you know from your other connections these trusts will be the recipients ultimately of certain tax free profits la the Cayman Islands and the anxiety is that the arrangement* should be as flexible as possible, consistent with the continuing tax free atafcus of the trust and of appointments made by the trustees to the beneficiaries of the tnsat. I have already given you some comment on the general features of the trust deed and If you feel a further discussion would be helpful please let ma know. I am sending a copy of this letter to Tours sincerely, D. Raid M a r t i n Cumy V C A D t- c ln ii C n l l t i n . W A C o n o r C r u w liy K C A I ju r c n i'f C r o w lr y K C A N ’ i.iB C r m v f c j ' K C A • V V iilM m K .iU - t - T A lid jp ir K o n Jo r K C A K ih v a c t l lu v / iin K C A n r ia r t O 'C n w m r A l ' A lA i v i il It m r i- I V A A U - x S jm m K C A C u iM u k a n t , ( i- m lil W ’ lin 't iT K C A tV in rip n t M a n n g ix t N im im a D a b IVliT D m llv k l i Kennedy Crowley &Co. Chartered A ccountants Hainault House 69/ 7 1 St Stephen's Green Dublin 2 Telephone 757971 _ . 9, Maple Road, Dublin 14. . IW: DR/GC ) tc; . 8th Kirch, 1972 JK R«: C « y a Traafcs. Doer ite cranpton, I an Barry that It haa taken aw rather longer to com back to you with tha draft Letter of Wlahea. Z an now eacloalng aix eoplaa of thla draft ao that It may ha considered by aaoh of tha individuals concerned. I think that tha terna of tha lattar ara fairly aelf-explanatory and should not give rlae to any problsns but, should anyone wish to dlacuaa then with no I would b« happy to do ao. Since I saw you wa have aent to tha Caynan Islands tha revlaad draft Trust Deed, together with the detail.) required to eonplete the appointed claas in each eaaa. . For eaaa of reference, and to avoid too such Identification, we are calling the Truata the Whitethorn Truats. Your own will be the Whitathorn A Trust, the Whitethorn B Trust, the Whitethorn C Trust, the Whitethorn D Trust, the Whitethorn X Trust, end Mr Webb'a the Whitethorn 7. Trust. ■ Aa soon aa tha Truata ara drawn up X will have tha Letter of Wlahea aigned In each caae by ■Vho la;,tha aettlor. Two formal atapa will than raaaln to he taken. The first la the formation by the Trustees of a coopany Cor conpanlea) to racelva incone fron deposita or investments on behalf of the Truateea. The aecond will be the execution by of a Dead (in blank) assigning his powers aa Appointor of tha Truata. Tiroira fo\ ra s aincerely, 1$, k Ends. KtkrtrhW > _<+M BANKERS GU .N E S S + M A H O IN l L T D 17Cofl«g«OtMnDublin2P.O.Box5SAT*leplioiw:718944 ACCOUMT • MRS V WEBB . NAM E cuwwNcv IRISH POUNDS d e s c r ip t io n RESIDENT CURRENT n ’i •v STATEMENT NO. PAGE NO. 4 i "^>*4*.*V-i-■- & 29APR83 *0ALANCfcfBftOUGHTFORWARDiOHAY83 TSFR FROM AC *: :*?L./ . >*.■'..... ' •i\v •"• r.rV'"*2 “j . xvaas> *, ..*'.•' • •. V •• • ••• V*1 • • •• ’• • . • : • •• • *•••*.* • . ••: . •••.*.• .. , ,« «• • • • * • * * • * . • ; ‘ •••• . *. .V? •? 7- ■ * •':X y ”!ai* *> i• , * er Qifefr *• *n v ' . * .• •* • v •* A • • • ' ST&21S.0* reference IR&276.00. Our Ref DPC/FMeG ' - Date 14th February 198* . .. '.af'*.?.•. *‘ vT*’ V '* r t; I have debited GMCT 'S' and creditid CMCT h ih i with ;$ @ r - ' •. lfX - v: - kv. •«•*•#*«.fL.. * * • ' • •* . • Summary of Memorandum Account Ledger Belanca In Hamntou Rom Co. Limited Description S Ansbacher Name DcaTrtynor 31/12/92 31/12/93 31/12/94 31/12/95 31/12/96 90,429 ' 68,604 198,994 264,252 249,307 . i ) ■MENtOF ACCOUNT, a f HAMILTON im i BOSS n a A/A7 - j 30/11/94 30/12/M 31/12/94 31/12/94 31/12/94 ACCOUNT NUMBER 80001084 * PAQE BALANCE8 SHOWN ARE If* s te rlin g 52879.10 32779.10 BROUGHTFORWARD 22/12/94 31/12/94 31/12/94 31/12/94 DRAWN Interest to 31/12/94 LODGED . LODGED 100.00 629.99 250.00 500.00 24 & & ) (HAMILTON MISS A/A7 L . 31/01/96 08/02/96 ACCOUNTNUMBER BALANCES SHOWN AREl 08/02/96 BROUGHTFORWARD IEP471 PAGE 83065.50 487.49 Appendix ?(134mm . EMU: I - 29/02/96 BROUGHT FORWARD 08/03/96 00/03/96 1121150 31/03/96 31/03/96 interest to 31/03/96 31/03/96 CARRIED FORWARD ) A/A7 ACCOUNT NUMBER 80001084 PAGE BALANCES SHOWN A R E It. s te rlin g 32 82578.01 82112.26 465.75 1030.53 83142.79 6 9152.00 REV ENTRY CE AND HARVEY 0 24/06/96 24/06/96 ROSS 30/06/96 02/07/96 02/07/96 .6. x? I 3:337&952.48 (HUVHEDFOHWARO l?l/D7/9h .0..- . "E?rf R038 3 was/93 31/03/93 1.0mm . - =Ji03/03 31/03/93 Interest to 31/03/93 31/03/93 FORWARD ANSBACH ER LIMITED . PO. Box 887 Grand Cayman British West Indies Telephone No. 9?465314 . Telex CP 305 Cable Address Guinness AINV. 80001084 PAGE 3 mam mam: sterling 5 . K: .v'33825.88 34566 . 53 . :r ~l 3.: '1 I. If! {3'33 Eff?lf?? ww- 3i/12/92 31/01/93 FORWARD ANSBACHER LIMITED P.O. Box 867 Grand Cayman British West Indies Telephone No. 9— 4653/4 Telex CP 305 Cable Address Guinness A/A7 ACCOUNT NUMBER 00001084 PAGE BALANCES SHOWN ARE IN: sterling 33325-80. 250.00 0 .0 0 33325.88 33575.88 1 Appwdix'xv GM .AHILTON R053 :1 BROUGHTFORWAHD 30/04/93 1.0m WRIED FORWARD - - . . . .. . in. .. .. ??"unh?lh ?fd-hib-h-?w 'mi . ANSBACHER LIMITED 9.0. Box 887- Grand Cayman British West Indies Telephone No. 9-465314 Telex CP 305 Cable Address; Guinness . 8000103,, mas l, sterl- 34566.53 250.00 "tars-Ln .. ,m 4 nwcw?. - nsbacller Limited 6: :wan 11/ 0; FOWMD ?1/12/92 31/12/92 LODGED 11/12/92 31/12/92 _Interest to 31/12/92 31/12/92 gunmen FORWARD .- . .. . . -. ANSBACHER LIMITED P.G. Box 887 Grand Cayman British West Indies Telephone No. 9?4653? Telex CP 305? Cable Address Guinness . ACCOUNT NUMBER 90601094 PAGE '44 sterling . 32077.60 250.00 590.22 33325.00 'A?PPendiX I r.mri'iiX) /,/vuv g u u n i A/A7 ACCOUNT NUMBER B00Q1004 PAGE BALANCES8H0WN ARE M: sterling - L _ u ■ ,!l “'• :..M BROUGHT FORWARD LOJKiW) 11 44391.1)8 230.00 03/ 05/ 93 '41 31/05/93 [1 . CARRIED FORWARD I . ANSBACHEH LIMITED P.O. Box 887 Grand Cayman British West Indies Telephone No. 9?4853? Telex CP 305 Cabin Address Guinness Accoum NUMBER 0000103? 95.05 5 mess snows mam: . - 5000.00 39016.53 250.00 40066.53 I . ?w Appendix . .1 3 U. Mun.? mm . Layman Lous?ED .s'aswu CAHRIED FORWARD ANSBACHER LIMIT. -, 7 - 887 Grand Cayman British West Indies .. - - Telephone No. 9?4653? . - TalexOP 305 Cable Address Guinness ACOOUNTNUMBER 80001084 PAGE 10 . sterling 42141.00 j' I 2000.00 (14141.08 154391 . 60 i 7 7 L- that? ROSS [3/0331 =uxu3x94 Hil?lillud 0 LMC army: ?103.9234 AGE 0 u, NJI- 9. 3mm FORWARD 23/03/04 . 29/09/94 30/ 09/ ?34 Internet to 30/ 09/ 94. CARRIED FORWARD 50001094 au;uceasaawuansne PAGE sterling '40550.33 - 3000.00 250.00 51800.33 5y0.77 52379.10 21 - Appendix xvau.) (1)13) n f uAM1LT0N m HOSS _ 31/03/95 *5/04/95 ?d/04/95^ 25/04/95 BROUGHTFORWARD LODGED _____________ CARRIED FORWARD j ACCOUNTNUMBER 80001084 PAGE BALANCES SHOWN AREN: sterling 25000.00 27 55088.54 80068 54 0UUDq' A p p e n d i x X V 1. 2. (135) M r R o b e r t Willis Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Robert Willis. a) Transcript of evidence o f Mr Robert Willis dated 9 February 2000. b) Letter o f 8 February 1990 - Ansbacher Limited to Guinness and Mahon. c) Letter o f 5 October 1990 - Ansbacher Limited to Guinness and Mahon. d) Letter o f 4 October 1991 - Ansbacher Limited to IIB. Correspondence received from or on behalf of Mr Robert Willis. a) Letter o f 3 December 2001 - Robert Willis to the Inspectors. b) Letter o f 5 February 2002 - Robert Willis to Inspectors. I I UNDER OATH ON WEDNESDAY, 9TH FEBRUARY 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO M R . ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. ROBERT P. WILLIS Represented by: MR. DIRMUID MURRAY DELOITTE & TOUCHE WITNESS MR. ROBERT P EXAMINATION WILLIS MR. ROWAN MS. MACKEY QUESTIONS 1-98 99 - 119 MR. JUSTICE COSTELLO 120 - 134 MR. ROWAN 135 - 14 8 MS. MACKEY 149 - 159 1 2 3 4 MR. ROBERT P. WILLIS, HAVING BEEN SWORN, WAS 5 EXAMINED AS FOLLOWS BY MR. ROWAN 6 7 1 Q. 8 A. 9 2 Q. MR. ROWAN: Good morning, Mr. Willis. Good morning. You very kindly wrote to us on 27th January. 10 you got a copy of your letter to hand, please, 11 Exhibit 1? 12 A. 13 3 Q. Have Yes. You confirmed very strongly in that letter, 14 particularly the third paragraph, that you have no 15 knowledge, directly or indirectly, of ever having 16 had a relationship with Ansbacher Cayman or with any 17 of the other companies mentioned in our letter to 18 you? 19 A. 20 4 Q. 21 A. 22 Is that the case? "I have no knowledge or recollection"; do you want me to repeat all the words? 23 5 Q. 24 A. 25 6 Q. 26 No, I am just listening to you? That is so. Good. Am I right in believing that you in the past have had an involvement with CRH? 27 A. 28 7 Q. 29 Yes. Very much so. Can you just tell us what that involvement was, 1 Well, I was Managing Director of Irish Life from 2 1967, and I think it was about 1970 a take-over bid 3 was made by Roadstone Limited for Irish Cement 4 Limited. 5 shareholding in each of those companies, a board was 6 being formed and there was an awful lot of ruckus 7 between the two companies. 8 asked to have a representative on the board and I 9 was asked to go on the board. Since Irish Life had a significant Irish Life was asked, or That would have been 10 around 1970, or whenever the merger took place. 11 became Cement Roadstone Holdings and subsequently 12 CRH, the same company. 13 8 Q 14 A 15 9 Q 16 A It You were a non-executive Director? Oh, yes. You went on the board around 1970, until when? I want to be quite sure, it was 1991, the Annual 17 General Meeting -- wait till I work out my 18 birthdays. 19 retirement age, in fact, was 70. 20 Traynor was then the Chairman and he was rearranging 21 the board. 22 just confine myself to your questions. 23 board until 1991, when I retired. 24 10 Q I was 67. Yes, May 1991. The Well, the late Des That is a lot of history. Sorry, I will I was on the You did, in fact, overlap with Mr. Traynor's time as 25 Chairman? 26 Oh, yes. 27 latterly because I had totally forgotten them. 28 think he became Chairman in 1987, I think. 29 would have been one of the Directors who would have I had to learn a whole lot of dates I Oh, I 1 2 So you would have got to know him to some degree 3 ...(INTERJECTION). 4 A Oh, I got to know him very well for a very long 5 time, because the early days of Cement Roadstone 6 were very torrid days. 7 sure I am talking in confidence here, but there was 8 an awful lot of in-fighting. 9 boards were just put together in mini takeovers. There was a lot of -- I am Unfortunately, the two 10 The stronger eliminates the weaker. 11 came together and there was a great amount of 12 argument, even physical argument, and, if I may say, 13 I got to know Des Traynor very well. He was a most 14 sensible, calm, reasoned individual. I had a lot of 15 time for him. 16 12 Q 17 18 A That was the only way. I didn't know him before I came on the board. 13 Q 21 22 You knew him, if I may use the word, professionally because of your serving on that board with him? 19 20 But the two Did you know him socially as a result, perhaps, of being on the board? A No. I don't think I was ever at his house. I dined 23 with him many times, as other professional 24 colleagues would have. 25 dinner once a year, so I would have met him and his 26 wife in that connection, but always with other board 27 members. 28 29 14 Q There was always a mixed You say in your letter that you had money on deposit with Guinness & Mahon in the period 1980 to circa 1 2 3 4 A. When I joined the board in 1970, there were fees 5 paid for Directors. 6 in Irish Life I did not get those fees. 7 arrangement I had set up myself with my own 8 Chairman. 9 other companies earning other fees so they were paid Now, because I was an executive This was an I didn't want people to spend time on 10 a salary and this was applied also to myself. 11 were spending an awful lot of time, especially in 12 the early years, on committees or fire-fighting 13 exercises. 14 grouping set up by the Chairman, when he became 15 Chairman, Michael Doherty. 16 formalised -- I had to go back through old minutes 17 and records of CRH to get these dates because I 18 could not remember them, and it related to my own 19 tax situation. 20 five or six of us on it, was formalised about 1978. 21 Again, I established that from old records. 22 stage, either then or later, payments were made to 23 those members of that committee. 24 record I can find payments for is 1983. 25 information I have given to Mr. McCarthy, 26 it fairly fresh. 27 with the agreement of my Chairman at Irish Life, 28 were paid to me, as distinct from the board fees 29 which were paid direct to Irish Life, until 1984, We There was, first of all, an informal That committee was That committee, there were about At some The earliest This is so I have Those payments, it would have been 1 when of course I retired from Irish Life. 2 committee fees were in two parts; there was a fee 3 and there was an expense allowance. 4 received those. 5 the PAYE system. 6 gross. 7 colleague, Des Traynor, as whatever he was, Managing 8 Director of Guinness & Mahon Ireland, to open a 9 deposit account. Those I would have The fees would have gone through The expense allowances were paid I gave those cheques to my business I was saving, I didn't -- it was 10 spare money, so far as I was concerned, and I opened 11 a deposit account. 12 16 Q 13 14 A I don't know the words I used, but that was the intention. 17 Q 17 18 'Mr. Traynor, would you put these into a deposit account for me?' 15 16 You gave them to Des Traynor and said, At that point at the start of this, around 1983, of course Mr. Traynor was not at that point with CRH? A Oh, he was. He came on the board at the same time 19 as I did. 20 Cement from way back. 21 the CRH board, the new board with all his Cement 22 colleagues and with all the Roadstone colleagues, 23 and then there were one or two non-related persons, 24 like myself, and that was the new board. 25 18 Q 26 A 27 28 29 He was a non-executive Director of Irish So, he would have come onto Forgive me, I intended to say as Chairman? Oh, no, he would have been from 1970 to 1987 a non-executive Director, exactly as myself. 19 Q He was a fellow non-executive Director in CRH at the same time as he was involved in the world of banking 1 2 3 Correct. 20 Q 4 5 Therefore, you said, 'Please open a deposit account for m e .' A It was convenient. I was getting the cheques from 6 CRH and he was across the table or in the coffee 7 room, or wherever, and I saw him a couple of times a 8 month. 9 21 Q That account was an account which you operated and 10 which you have talked to the Revenue about, as you 11 indicated in your letter? 12 A Each amount of money was relatively small, a couple 13 of thousand. 14 This was spare money, I was saving it. 15 22 Q I think they were paid half yearly. That gives me, at least at this point, sufficient 16 background. 17 maintain a bank account with the Royal Bank of 18 Scotland in London? 19 A Yes. I wonder could I ask you, do you That goes back a very long time. 20 Incidentally, we have some papers that we got from 21 Guinness & Mahon when we asked them had they any 22 records. 23 23 Q 24 A We have photocopies. Thank you. It was actually way back -- I don't know when it 25 started, but it was a business account. 26 opening offices, 27 London and Belfast in the 60's, and I would have had 28 an account, 29 was actually a small bank called Williams & Glynn. We were Irish Life were opening offices in I presume taken out by the company. It 1 I think they were connected with the Bank of 2 Ireland. 3 60's. 4 speculating, but dates like the mid 70's, I had a 5 whole network set up in the UK and I wasn't using 6 that account, as such, business wise and I took it 7 over as a personal account, and I kept small 8 balances, a couple of thousand in it, and when I was 9 over there my wife shopped, it was personal. That account went way back to I think the By the 70's, I suppose I am sort of The 10 record will show you where I asked Des from to time 11 to transfer £ 1 ,000 , £ 2 ,000 . 12 24 Q. Perhaps it is valuable if you would take us through 13 these papers and just describe to us what they are, 14 please, in connection with the Bank of Scotland 15 account? 16 A. The Bank of Scotland eventually took over Williams & 17 Glynn. 18 a moment, dated 21st May 1986, there is a piece of 19 paper which says 2nd August 197 9, "JDT to TRL" 20 Exhibit 2. 21 22 25 Q . A. If you ignore the bottom piece of paper for Yes. You see the bit in script that was behind that or 23 with it, which is Williams & Glynn Bank, that is my 24 handwriting, and there is R.P. Willis written at the 25 top. 26 him to transfer £2,000 to that account. 27 old number, because the number subsequently changed. 28 So, I have to assume that when it was that number it 29 would have been in the time when it had been set up I don't know the precise details, but I asked That is an 1 by Irish Life, and then I subsequently took it over 2 as a joint account with my wife. 3 probably going to ask me anyway, but I do not know 4 -- I only saw these bits of paper about two months 5 ago when we asked Guinness & Mahon to search their 6 records for anything. 7 debit to G.M.G. B/K7". 8 nothing to me. 9 MS. MACKEY: Sorry, which paper are we on? 10 MR. ROWAN: This is the last page, Exhibit 11 2. 12 A. However, you are You see the words "ultimate That conveys absolutely It might mean something to you. I am working from the bottom. 13 MS. MACKEY: All right. 14 MR. ROWAN: It says "Urgent JDT to TRL". 15 A. Yes. Now, I do not know whether I had a deposit 16 account with Guinness & Mahon in Dublin at that 17 point in time or whether I would have asked him 18 could he facilitate me by sending £2,000 to London, 19 because otherwise it was going to be -- well, I 20 presume, even in those days, one could have 21 transferred £ 2 ,000 , it wasn't a big amount, but it 22 would have meant a lot of paperwork and it was 23 easier to see a guy up in Fitzwilliam Square and 24 say, 25 and he would say, 26 whatever it is, £ 2 ,1 0 0 , and I will do it.' 27 not tell you now precisely what happened, but that 28 piece of paper emerged from Guinness & Mahon. 29 accept that I asked him to transfer £ 2 , 000 to this 'You are a banker, can you transfer £2,000?' 'Well, give me a cheque for I could I 1 account, which was in my name in Williams & Glynn. 2 That is 1979. 3 4 The next record is 13th August 1985, and that is, 5 Exhibit 3, still Williams & Glynn. 6 stage I got a letter from Williams & Glynn saying -­ 7 they were rather picky, you know -- 'You have not 8 been using this account and there is only a small 9 balance, what are you going to do about it?' I know at one I 10 would have again asked Des to -- the number has 11 changed, but it was the same account and it was 12 Williams & Glynn. 13 26 Q. 14 A. That is account No. 17372804? Yes, and I still have that account. Then in August 15 1986, now it has become Royal Bank of Scotland, but, 16 as you notice, it is the same address, Exhibit 4. 17 27 Q. 18 A. Yes. It is really just topping it up. I know I was going 19 over to the UK quite a bit, personally, in that year 20 because my sister was married -- well, she is a 21 widow -- in Newcastle-on-Tyne, and her husband died 22 early the next year. 23 UK for some of the time, working abroad. 24 1986, I topped the account up again by another 25 £2,500. I also had a son living in the November That is in 1986 (Exhibit 5). 26 27 The last one is dated 9th October 1990, Exhibit 6 . 28 The account I had with Guinness & Mahon in Dublin, 29 as I understood in Dublin, I thought I had cleared 1 that. 2 son in 1987, to buy an apartment, and I thought the 3 account was closed and done away with. 4 communication, maybe a telephone call, presumably in 5 1990, 6 is a small balance in this account, what do you want 7 to do with it?' 8 letter, October 1990 Guinness & Mahon in Dublin sent 9 £1,000, again to the same number account, I made a gift of the contents of that to my I had a I thought it was 1989, from Des to say, 'There As you can see from that last (Exhibit 10 6 ) and I think I got the rest as a cheque or cash. 11 As I say, I thought I had closed the Guinness & 12 Mahon account in 1987/88, but in fact there was a 13 small residue. 14 15 Finally, there is a longer piece of paper dated 21st 16 May 1986, Exhibit 7. 17 you see at the bottom I was unsuccessful, in 1986, 18 and I asked Des could he give me temporary 19 accommodation. 20 Bank of Ireland, and if I can read or understand 21 this memo accurately, he was saying to CW, "Mr. 22 Willis may want a cheque in a hurry for something 23 less £ 1 0 ,000 , which I already have in my current 24 balance in Bank of Ireland." 25 facility. 26 sure that the logic would have been I would have 27 said to him, 28 with you, I may want bridging finance in a hurry, I 29 am going to an auction.' I was bidding for a house and I, at that time, had an account in I didn't use that Presumably, it is speculation, but I am 'Look, I have X thousand on deposit It must mean, by 1 subtraction, that I had at least £30,000. 2 does not mean that because he might have been 3 prepared to -- well, I probably would have had as 4 much as £30,000 at that time. 5 28 Q. 6 Right, thank you. But, it May I just raise one minor question on the memo "Urgent JDT to TRL, Exhibit 2"? 7 A. 8 29 Q. 9 Yes, 2nd August 1979. You mentioned that it was not at all obvious what was meant by the "ultimate debit to GMGB/K7"? 10 A. 11 30 Q. 12 A. Yes. Did you ever ask Mr. Traynor what that meant? No, because I never saw this. I only saw this a 13 couple of weeks ago when I got it from Guinness & 14 Mahon. 15 31 Q. 16 I want now to ask you to look at a copy document which we have (SAME HANDED TO MR. WILLIS). 17 A. 18 32 Q. 19 A. 20 33 Q. 21 A. 22 34 Q. Yes, thank you. (Exhibit 8 ). You observed the date as 9th February 1990? Yes. It is an instruction to ...(INTERJECTION). That is the same account number, yes. ... to send a sum of £4,000 pounds to your account, 23 which we have established was with the Royal Bank of 24 Scotland? 25 A. 26 35 Q. Yes. That was a sum of money which in fact was coming 27 from Guinness & Mahon. 28 your involvement with Guinness & Mahon, in terms at 29 least of a deposit account, I think you said to us that finished about 1989; 1 2 3 time I have seen this one, Exhibit 8 . 4 perhaps I should wait for your question. 5 36 Q. 6 Yes, sorry, Therefore, what was happening was £4,000 was being sent to your London account? 7 A. 8 37 Q. 9 Correct. May I then please show you another letter, if you would perhaps just read for a second, please? 10 A. 11 38 Q. 12 Yes. That is headed "Ansbacher", Exhibit 9. If you analyse that letter, you will see it is on Ansbacher paper? 13 A. 14 39 Q. Yes. It is a letter from Mr. Traynor instructing that 15 £1,000 Sterling is credited to Royal Bank of 16 Scotland account in London, and the cost should be 17 debited to Ansbacher Limited, Account No. 13154602. 18 What do you think was happening there? 19 A. Obviously, there was a further transfer. I must 20 have had a further credit or more credit in my 21 deposit account than I realised. 22 heard the word "Ansbacher" until I read it in the 23 newspaper, though I now know that there was an 24 Ansbacher in the UK, presumably it was this one. 25 4 0 Q. As I say, I never But you can see that what was happening was that 26 your London account was getting the credit of the 27 £1,000 Sterling? 28 29 A. £4,000, yes. 1 2 41 Q. MR. ROWAN: 3 Sorry, excuse me, yes. Look at the one, please, 4 the £4,000 one, which is 8th February 1990, Exhibit 5 10? 6 A. 7 42 Q. 8 A. 9 43 Q. 10 A. 11 44 Q. 12 We will deal with that one first. Right. 8th February 1990Exhibit 10? Yes. It has some of the same features, it is a request to transfer £4,000 Sterling to your account? 13 A. 14 45 Q. Yes. It says it should be charged, "the debit should be to our account 13154602"? 15 16 A. 17 4 6 Q. 18 19 Yes. Yes. Do you have any appreciation of what was going on in terms of where that was being charged to? A. No. Let me be careful what I say. I believed that 20 I had a deposit account in Guinness & Mahon in 21 Dublin. 22 -- I mean, this is one of my great problems today, 23 what did I know and what now did I think I knew. 24 I think now that there was an account, without my 25 authority, with some overseas body. 26 somewhere along the line there are these little 27 slips of notification of credit balances which I 28 certainly got and asked questions about and didn't 29 get an answer, that now, with great hindsight, it From all that I have read in the newspapers I am sure 1 clicks. 2 Dublin, but I now think that my money may well have 3 been somewhere else. 4 I haven't this in context now, but I had assurance 5 from Des, 6 money is in Dublin, you have full access to it 7 whenever you want it.' 8 things, but I must have asked that more than once, 9 because I remember that. I always believed I had an account in I had assurance, because I -­ 'You have nothing to worry about, your I don't remember a lot of I am agreeing with you 10 that that seems to show that my money, or some of my 11 money was in some overseas account, but not at my 12 instance. 13 47 Q I presume that is important. If that was a transfer to your London account out of 14 another account in Ansbacher, did you ever receive 15 documents in relation to that account? 16 A 17 48 Q 18 A 19 20 Yes . Not at all, no. "Ansbacher". 49 Q 21 22 This account? I didn't even know the name I am quite sure of that. Well, why do you think then £4,000 was being transferred out of that account? A I presume I asked Des to transfer £4,000. What 23 surprises me, because I thought there was only this 24 -- I have been quickly looking at your second 25 letter, Exhibit 9, and that corresponds with the one 26 I have, the £1,000 Exhibit 4. 27 50 Q 28 A 29 Yes . I thought that that was the tag end of my account, but there must have been, if you like, £5,000 in it, 1 2 51 Q. 3 A. All right, let's carry on. I have just been reminded that the letter I 4 submitted to you, dated 9th October 1990, is an 5 acknowledgment from the Royal Bank of Scotland to 6 Guinness & Mahon, College Green, Exhibit 7 52 Q. 8 Yes. 6. Perhaps we can come back to these matters a little later? 9 A. 10 53 Q. Okay. What I want to show you now is a copy of a cheque, 11 Exhibit 11. 12 Holdings cheque account. 13 like to have a look of it (SAME HANDED TO MR. 14 WILLIS). 15 but I think there is sufficient detail on it for you 16 to get an impression of the cheque. 17 A. 18 54 Q. 19 A. 20 55 Q. £1,639. 69, I think it is? Yes. What do you think that cheque might have been in relation to? 22 cheque? A. If you would just, please, The copy, I am afraid, is not very clear, 21 23 It is a cheque on Cement Roadstone What were you getting paid for by that In June 1987, those would have been board fees -­ 24 well, I think the committees fees had stopped in 25 1986, so it has to relate to a board payment or a 26 reimbursement. 27 straightforward Cement Roadstone Holdings cheque 28 payable to me and obviously given to Guinness & 29 I am guessing. It is a 1 Yes, all right. 2 document, which is a Banque de Nationale de Paris 3 cheque -- draft, I think it is, actually, Exhibit 4 12? 5 A 6 57 Q 7 A Could I show you then another Yes . For IR£1,050? Yes. I had a deposit account with BNP, of which I 8 was a Director. 9 very long number of years there. 10 58 Q 11 A 12 13 I have had a deposit account for a That was a payment to you once again? Yes. I see what you are asking me. I would have been ...(INTERJECTION). 59 Q 14 Sorry, Mr. Willis, I haven't asked you . . . (INTERJECTION) . 15 A 16 60 Q Sorry, I won't jump ahead. Would you just bear with me for a second. I would 17 like to show you a third document, which is a Church 18 & General cheque for IR£397.50, Exhibit 13? 19 A 20 61 Q 21 A 22 62 Q Yes, also 1987. Made payable to you? Yes . What I wanted to put to you, Mr. Willis, was that 23 rather interestingly those three cheques, plus 24 another in the amount of £3,382, payable from AIB, 25 those four cheques were lodged on 23rd July 1987 to 26 a Guinness & Mahon account, and I wondered how it 27 was that they all came together to be lodged on the 28 same day? 29 Well, the most likely explanation, and I am trying 19 1 to think backwards, was I had arranged with my son 2 that he would buy this apartment and I presumed that 3 the account, or I thought the account -- I think the 4 account in Guinness & Mahon needed to be topped up 5 to meet the expected outlay. That outlay, as I said 6 to you earlier, was in 1987. These would all have 7 been cheques out of -- Banque de Nationale a deposit 8 account, which as I say is still there, the Church & 9 General would have been board fees from Church & 10 General of which I was a Director, and similarly 11 CRH. 12 gathered them together and said to Des, 13 into my account.'. 14 63 Q Okay. I presume all these cheques had come in and I 'Put these I want to show you now another document, 15 which is a copy of a Guinness & Mahon ledger card. 16 You will observe that it is an account in the name 17 of Amiens S/L, No. 2 account, Exhibit 14? 18 A 19 64 Q 20 A 21 65 Q 22 23 Yes . Account no. 10407006? Yes . Do you recognise a document of that sort? seen that sort of thing before? A No, never. I had only heard of Amiens when it came 24 out in all this recent literature. 25 anything that seems to connect it with me? 26 Have you 66 Q Is there Well, I wanted to know whether, in fact, you had 27 seen that before, because the total of the cheques 28 that I was mentioning, plus another cheque, were the 29 subject of that lodgement on 23rd July 1987, the 1 credit of £12,910.29. 2 that lodgement. 3 your cheques were lodged, as we have heard, on your 4 behalf into this Amiens S/L account, Amiens 5 Securities. 6 Ansbacher account which was maintained in Guinness & 7 Mahon, into which Irish currency was lodged or from 8 which payments were drawn in Dublin? 9 A 10 67 Q 11 A So, your cheques were part of The point I am getting to is that I want to tell you now that this was an Yes . So I want to give you that piece of information. Thank you, yes. This does not mean anything to me. 12 I accept, obviously, that these were cheques in my 13 favour which I lodged in Guinness & Mahon. 14 know what happened to them after that. 15 they were going into my deposit account to correct 16 what, presumably, was a shortage in the money that I 17 was sending to my son. 18 68 Q 19 A I don't I assumed You do not have any records of your deposit account? No. The only records I ever received, that I can 20 recall, were these little white slips of paper, 21 which I didn't keep. 22 haven't got now. 23 69 Q 24 A Presumably, I had kept, but I Can you describe the white slips of paper, please? Not very well. From time to time, I was handed in 25 an envelope, obviously by Des, a piece of paper -- I 26 cannot really say now, it might have been that sort 27 of size (INDICATING), which would have shown my 28 balance and presumably any additions and interest. 29 1 recall any other documentation. 2 awfully naive, but I would totally trust Des 3 Traynor. 4 70 Q 5 A 6 71 Q 7 A I know this sounds I sat with him for years. It didn't have the name of a bank on it? No, no. Was that not a surprise? It was, and I asked him -- well, when I say I asked 8 him, I am sure, I believe I asked him and I believe 9 I got some sort of soft answer, it was this mantra 10 again, 11 is in Dublin and you can have access to it any time 12 you want to.' 13 to me. 14 wasn't quite kosher, but either I hadn't the guts or 15 I didn't want to ask or find out what he had done 16 with my money. 17 an account in Dublin and that is what I believed. 18 72 Q 19 'You have nothing to worry about, your money I am sure he said that at least twice As the time went on, sure, I felt everything I was giving it to him to put into From time to time you would have earned some interest on this unnamed deposit account? 20 A 21 73 Q Yes . In the ordinary course of events, you would have 22 considered yourself to have some sort of a taxation 23 liability on the interest? 24 A Yes, which I didn't return. I have been able to 25 check that through looking at my accounts. 26 this day I am not sure whether banks, in fact, 27 returned interest. 28 but I don't know whether banks, before DIRT, 29 returned interest to the Revenue Commissioners. Now, to I certainly didn't return it, 1 74 Q. Let's carry on. I would like you to look at 2 another Ansbacher letter of 4th October 1991, 3 Exhibit 15? 4 A. 5 75 Q. Yes. You can see it has a similar format to the others 6 except this time it is an instruction to Irish 7 Intercontinental Bank? 8 A. 9 76 Q. 10 A. 11 12 Yes. Once again that money is being sent to London? That must have been the time that the account was closed then. 77 Q. 13 You are getting the credit in London and it is being charged, debited to the ...(INTERJECTION). 14 A. 15 78 Q. To the same London account number, yes. That is right, it is being credited to the same 16 account number in London and charged to the 17 Ansbacher account No. 02/01087/81? 18 A. 19 79 Q. 20 Yes. I never saw any of these letters. Am I correct, you don't know what that account in Ansbacher is? 21 A. 22 80 Q. Absolutely not. Well, I wonder then could I help you by telling you 23 that that was an account which Ansbacher maintained 24 in Irish Intercontinental Bank which allowed money 25 to be lodged and payments to be made in Dublin, as a 26 matter of record? 27 A. 28 81 Q. 29 Grand. If I can summarise where we have got to here, you 1 2 3 82 Q. 4 maintained in Dublin? 5 A. 6 83 Q. 7 8 And that you believed the deposit account was Absolutely. But you now have seen evidence which suggests that it was an Ansbacher account? A. 9 Of some sort, yes. From all I have read in the papers, the newspapers, I have had this suspicion 10 for some months now that my money was not 11 necessarily in Dublin. 12 84 Q. But, of course, you were fairly firm with us in your 13 letter, weren't you, when you say "I had no 14 knowledge directly or indirectly Exhibit 1"? 15 A. 16 85 Q. 17 A. 18 86 Q. That was meant to convey -- yes. But you did have a concern? I did have a concern, yes, but I had no proof. You also received rather scanty documentation for 19 this Ansbacher account, as we now know, where the 20 information did not disclose the name of the bank, 21 but that you did earn interest on that deposit 22 account? 23 A. 24 87 Q. Correct. Do you have any other documentation which might be 25 relevant to this, now that you know the real 26 position? 27 A. No, sir, but, as I have said in my letter, I am most 28 anxious to find anything that exists. 29 to help. I am anxious I have no papers and I have no knowledge, 1 but if you can give me -- I could write to Ansbacher 2 asking them for a statement of account or whatever, 3 but I have no frame of reference. 4 here that might ...(INTERJECTION). 5 88 Q. 6 A. 7 8 9 Q. 8 There are numbers Well, you do have now? Yes, and I am quite willing ...(INTERJECTION). And you do have an address and we would like you, please, to do that. 9 A. 10 90 Q. 11 A. 12 91 Q. Certainly, and use these numbers? Yes. Well, are there different numbers? You can pass copies of that information to Ansbacher 13 and they should be able to provide you with details, 14 going back to the middle 80's, of the account which 15 Mr. Traynor provided you with, with I think the top 16 cut off the statements? 17 A. 18 19 obviously lots of space. 92 Q. 20 A. 22 93 Q. 23 A. 94 Q . 25 A. 26 95 Q. 27 A. 28 96 Q. 29 It would have been like the Guinness & Mahon statement, but with the top cut off (Exhibit 14)? 21 24 It was like a computer printout sort of thing, with The one that you said was Amiens. Yes, the Amiens ...(INTERJECTION). This one (INDICATING)? Yes. You are telling me this is it? I believe it to be the case. I see. Thank you. I thought it had my name on it. Well, that may be a possibility, but, in any event, 1 ask them to provide you with whatever information 2 they have? 3 A. 4 97 Q. 5 A. 6 98 Q. 7 A. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Using these references? Yes. The two bits of paper? Yes. Certainly. MR. ROWAN: Thank you. I haven't got any other questions at the present. 1 2 M S . MACKEY 3 4 MS. MACKEY: Mr. Willis, I just have one or 5 two questions I would like to 6 ask you. 7 shown you there, the letter on Ansbacher paper, 8 dated 5th October 1990, directed to the Irish 9 Intercontinental Bank Limited, Exhibit 8 ? 10 A 11 100 Q 12 You have seen the document Mr. Rowan has Yes . Did you have an account with Irish Intercontinental Bank? 13 A 14 101 Q No, no, never. Did Mr. Traynor indicate to you that your monies had 15 moved from Guinness & Mahon to Irish 16 Intercontinental Bank? 17 A No. Well, I have to be careful. I don't recall 18 that he ever did. 19 Bank, I knew Paddy McEvoy quite well. 20 Irish Life owned part of Irish Intercontinental for 21 quite some time. 22 relationship. 23 102 Q I know Irish Intercontinental In fact, So, I would have had that sort of No, it is quite a surprise to me. You were telling Mr. Rowan a few moments ago that 24 you thought you had cleared out your account in 25 Guinness & Mahon at the end of 1989? 26 Yes, I transferred to my son sums sufficient to buy 27 his apartment. 28 much as £5,000 left, but presumably I had 29 over-provided in these various cheques. I am surprised that there was as 1 I think you said to us also that you were surprised 2 to find that there was a little extra left, because 3 Mr. Traynor asked you if he would transfer it to 4 your bank, the Bank of Scotland? 5 A Yes, and I thought that was in 1990, but obviously 6 that was the communication in 1991. 7 important ? 8 104 Q 9 Is that I am trying to clarify what exactly happened to the balance of the account in Guinness & Mahon. You 10 thought you had cleared it out in order to assist 11 your son? 12 A 13 105 Q Yes . Then, I think you told us, if I am not mistaken, 14 that Mr. Traynor contacted you and said there was a 15 small balance ...(INTERJECTION). 16 A 17 18 or 1991. 106 Q 19 20 Yes, but I am now not sure whether that was in 1990 We saw some evidence of a transfer in 1990, to your bank, the Bank of Scotland, of £1,000? A 21 £4,000 then. lead me. 22 107 Q 23 A Wait, now. Sorry, I better let you It was £1,000, yes. It was both, there was £1,000 and there was £4,000? MR. JUSTICE COSTELLO: Right, 5th October, 1990, 24 Exhibit 9,and 4th October 1991, and that is £1,000 25 and that is £1,000 Exhibit 15. 26 another ...(INTERJECTION). 27 No, it is the two in 1990. 28 29 There must be 1 2 109 Q MS. MACKEY: It is two of February, 3 think, 1990; is that 4 right? 5 A 6 110 Q 7 A 8 111 Q 9 A 10 112 Q Well, 5th October and 8th February, yes Exhibit 10. One sending £1,000 and the other £4,000? Correct. They are both in 1990? Correct. That, as you understood it, was the balance of your 11 account being transferred over to the Bank of 12 Scotland? 13 I A I think so, yes. I am trying to remember. I am 14 surprised that there are three transfers in 1990 and 15 1991. 16 would have thought there was one. 17 113 Q I would have thought, if you had asked me, I What I am trying to really ascertain here is how 18 money of yours got to the Irish Intercontinental 19 Bank? 20 A 21 22 I see what you mean. I don't know. I mean, I didn't put it there. 114 Q Did you continue to get statements from Mr. Traynor 23 after 1990? 24 No. 25 didn't get statements after 1987/88, when I cleared 26 out the balance, which was about £70,000. 27 remember. 28 with accuracy, but I don't recall that I got 29 statements after the major transaction. I don't know, but I would have thought that I I don't It is very hard to remember anything now I cannot 1 account for the 1990 letters at all. 2 had said to me there was that £1,000 in 1991, 3 whether it was Intercontinental Bank or anywhere 4 else, I would have thought that was the tag end of 5 my account. 6 and the £ 1 ,000 . 7 115 Q. I mean, if you These two quite surprise me, the £4,000 I am more interested in the 1991 one, as to how the 8 money came to be in Irish Intercontinental Bank 9 since you say you have no ...(INTERJECTION)? 10 A. I never put it there. I certainly would have long 11 since stopped -- I mean, those 1987 lodgements, 12 suppose I would have to say I would guess, but my 13 recollection would be those would have been the last 14 of the lodgements I ever made. 15 116 Q. 16 What, as far as you know, is the status of your account now? 17 A. 18 117 Q. Which account? The account that you originally opened with Des Traynor? 19 20 A. 21 118 Q. 22 A. 23 119 Q. 24 25 Okay, thank you. I Oh, long gone. Long gone? Yes. You didn't know until now that you had money in Irish Intercontinental Bank? A. I am sure that there was some conversation between 26 Des Traynor and I, which now must have been 1991, 27 saying 'Do you want me to close this or whatever, 28 because you have not been making lodgements?' 29 sure it is long gone. I am 1 I see. I have no other 2 questions. 3 Thank you, Mr. Willis. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 END OF EXAMINATION OF MR. WILLIS BY MS. MACKEY 1 2 COSTELLO 3 4 MR. JUSTICE COSTELLO: I have just a few 5 questions. Mr. Traynor 6 had offices in Cement Roadstone, CRH; isn't that 7 right ? 8 A 9 10 Yes, sir, from the time he would have been Chairman. That would have been from May 1987. 121 Q 11 You used to go in to his offices to get these statements that you referred to? 12 A 13 122 Q 14 A No. Where did you get the statements from? Anywhere and everywhere. At lunch, or coffee, or 15 somewhere. 16 office of the Chairman of CRH. 17 123 Q 18 It was Mr. Traynor, anyway, who gave you these statements? 19 A 20 124 Q 21 A 22 125 Q 23 24 No, I respected his office, that was the Yes . On a casual basis ...(INTERJECTION). Yes, or he might post them to me. Or he might post them to you. Was this on a regular basis, Mr. Willis? A I cannot really say. I don't have an impression of 25 regularity, but I cannot really say now. 26 have stretched over the years, let's say, from 1980 27 to 1988, but it might have been once a year or twice 28 a year. 29 It would 1 Well, for several reasons. 2 trigger for the payments to Mr. Traynor were the 3 committee fees, and they ceased, I have been able to 4 establish, in 1986. 5 I wanted all board members to be available to be 6 members of committees, so we changed the system then 7 and increased the main board fees and eliminated 8 the others. 9 of 1986. First of all, the main In fact, we changed the system. That happened in the mid or late half That was the main trigger. It was those 10 cheques I was giving him. 11 arranged for the payment as a gift to my son, he had 12 a personal problem, but anyway, and this apartment 13 was bought. 14 the dates with him, and that finally was occupied in 15 the Spring of 1988. 16 have gone out through 1987 in tranches. 17 127 Q 18 19 Then, the next step was I That happened -- again, I have checked So, the payments for that would You say the payments went out. Did you make lodgements so that the payments would go out? A I thought there was enough in the account. In fact, 20 it had been on that basis I would have talked to my 21 son, 22 pesetas' 23 128 Q 24 'Find find an apartment costing so many It does appear, Mr. Willis, that there was money in the account after 1988? 25 A 26 129 Q 27 A Yes, sir. Did you make any lodgements after 1988? Not that I recall. I had the capacity to do it, my 28 cash flow was strong and I wasn't spending, but I 29 don't recall making any lodgements after the 1987 1 2 130 Q It looks now, does it not, as if your deposit was 3 maintained after 1988 and 1989, right up to 1991, at 4 any rate? 5 A 6 131 Q That is so. In your letter to us you said that you informed the 7 Revenue Commissioners that you had money on deposit 8 for the period 1980 to ending circa 1989? 9 A 10 132 Q 11 A 12 133 Q 13 A 14 134 Q Yes. That was my belief. It is inaccurate now, I think? Yes . You accept that is inaccurate? Oh, yes, I do. During the period you were receiving interest on the 15 payments these were not returned for income tax 16 purposes and you are in discussion with the Revenue 17 about it? 18 Correct. 19 20 END OF EXAMINATION OF MR. WILLIS BY MR. JUSTICE 21 COSTELLO 22 23 24 25 26 27 28 29 1 2 M R . ROWAN 3 4 135 Q. MR. ROWAN: Mr. Traynor was Chairman 5 of CRH and you were a 6 fellow Director? 7 A. 8 136 Q. 9 The role as Chairman of CRH would, presumably, since he was executive Chairman, as I understand it 10 ...(INTERJECTION). 11 A. 12 137 Q. 13 A. 14 138 Q. 15 No. He wasn't, he was a non-executive Chairman? Yes, non-executive. He had an office, nonetheless, and he had secretarial support in his office? 16 A. 17 139 Q. 18 A. 19 14 0 Q. 20 21 Yes. In Fitzwilliam Square, when he became Chairman. He was non-executive Chairman? Correct. Which meant that he was not engaged every day on CRH business? A. Yes, it was a very demanding office and he was very 22 good at it. 23 allegedly done, and indeed rather let me down, he 24 was a very good Chairman, and he was a busy one, he 25 would have entertained, but I presume it wasn't 26 full-time. 27 lots of things got done in CRH when he became 28 Chairman, including renovating the board. 29 141 Q. For all the things that he has I didn't sit in judgment on him. But, But he was also to provide this banking facility to 1 2 Yes . 3 142 Q 4 A Did you know that he was involved? No, I was shocked when I discovered, when I read 5 everything. 6 Des Traynor of Guinness & Mahon was important to me. 7 143 Q I thought my little bank account with He wasn't from 1986, or thereabouts, he wasn't with 8 Guinness & Mahon anymore and yet you continued to 9 bank with him? 10 A Yes, well, there was no problem with giving him 11 cheques. 12 was doing. 13 Director of Guinness & Mahon. 14 that what his relationship was with Guinness & 15 Mahon. 16 him the cheques. 17 144 Q In fact, I didn't keep track of what he I knew he had retired as Managing I wasn't sure after There seemed to be no problem, I just gave As a Director of CRH, you were entirely comfortable 18 with your Chairman carrying out some sort of banking 19 capacity from CRH's offices? 20 A I wasn't aware that he carried it out from CRH's 21 offices. 22 Chairman of CRH and he did an excellent job. 23 Chairman of other things too, like New Ireland and 24 so on, and I presume he wrote letters and did 25 things. 26 any difficulty. 27 your question? 28 Since you and he were on the board for much of the 29 same time, on the CRH board for much of the same I was entirely comfortable with him as the He was I trusted the guy 1 0 0 % and I didn't have Sorry, have I lost the thrust of 1 time, and bearing in mind -- and you can see this 2 from two of the Ansbacher letters which we discussed 3 earlier -- you can see that the letters said, 4 "Please reply to 42 Fitzwilliam Square.(Exhibit 10 5 and 1 1 )"? 6 Yes . 7 146 Q 8 9 in CRH? A 10 11 As I understand it, that was his Chairman's office That is correct. They moved offices from down the road, but, yes, this is the address. 147 Q Did he, do you believe, obtain the approval of the 12 board to using CRH's offices to front the Ansbacher 13 bank? 14 A No, I am sure he didn't obtain it and I am sure we 15 did not know -- I didn't know and I don't think 16 anybody else did. 17 148 Q Do you think that action would have been a breach of 18 his fiduciary duty as a Director? 19 I am not sure what -- I am not a lawyer, but to have 20 used an office -- I have to ask myself what is 21 conducting banking business. 22 behind a grill taking in money. 23 personally, 24 Chairman's office to be used for this sort of 25 business. It wasn't a little man Speaking I would not have expected CRH's 26 27 END OF FURTHER EXAMINATION OF MR. WILLIS BY 28 M R . ROWAN 29 1 2 M S . MACKEY 3 4 149 Q. MS. MACKEY: 5 Just in relation to that last point made by 6 Mr. Rowan, when you first asked Mr. Traynor to open 7 an account for you or to take your cheques and put 8 them on deposit, you understood that to be in 9 Guinness & Mahon? 10 A. 11 150 Q. 12 Dublin. At that stage Mr. Traynor was still connected with Guinness & Mahon? 13 A. 14 151 Q. Yes. Once he had opened that account for you, why did you 15 not lodge your cheques directly to Guinness & Mahon? 16 Why did you give them to him? 17 A. Because, in many instances the cheques were with the 18 committee papers or the secretary handed them out, 19 it would be in a folder, we would be at the same 20 meeting. 21 remember whether it was frequently, whenever it was 22 convenient ...(INTERJECTION). 23 152 Q. 24 A. 25 153 Q. 26 A. 27 154 Q. 28 A. 29 155 Q. I did go in to College Green, I cannot In connection with this particular account? Oh, yes, to give him the cheques. To give them? To him, personally. To Mr. Traynor, personally? Yes. You went in to Guinness & Mahon and you gave them to 1 2 3 Oh, yes. 156 Q 4 Following his departure from Guinness & Mahon, you continued to give him cheques? 5 A 6 157 Q Yes . Why would you hand cheques to your Chairman to lodge 7 for you when he was no longer connected with 8 Guinness & Mahon. 9 A I always associated him with Guinness & Mahon, even 10 when he ceased -- to me he was always Des Traynor of 11 Guinness & Mahon. 12 158 Q 13 A But he wasn't, in fact? Well, yes, I hear you. I don't know how or where, 14 whether he had -- well, I don't know if he had 15 another office, but I would have sought an 16 opportunity -- it wasn't very often, it was twice a 17 year, and it wasn't for very long, because, let's 18 think again -- May 1987. My depositing had stopped 19 very shortly after that. Not because he was 20 Chairman, but because I was paying the money out. 21 159 Q Presumably, when you handed the cheques to 22 Mr. Traynor after his departure from Guinness & 23 Mahon, he, if it was in the normal course of 24 banking, would have had to organise a secretary or 25 someone to go to Guinness & Mahon where he no longer 26 worked and lodge them for you. 27 unnecessarily complex? 28 Yes, I hear you. 29 is for sure. It just seems Yes, I gave him the cheques, that 1 Very good. 2 Mr. Willis. Thanks, 3 4 END OF FURTHER EXAMINATION OF MR. WILLIS BY 5 M S . MACKEY 6 7 MR. JUSTICE COSTELLO: Thank you, Mr. Willis. 8 You will contact Ansbacher 9 then and give us all the records that they have in 10 11 relation to your account? A. 12 Yes. MR. JUSTICE COSTELLO: 13 Yes, thank you. Ms. Mackey has drawn my 14 attention to the fact that you also had an account, 15 it appears, in IIB. 16 well. 17 A. 18 Would you write to IIB, as Write to them, too? MR. JUSTICE COSTELLO: 19 your account there. 20 21 Apparently, it was in your name in IIB. A. 22 Was it? MR. JUSTICE COSTELLO: 23 26 27 28 29 Well, perhaps not, it may have been in 24 25 Yes, find out about Ansbacher's name. A. We will ask them. that. I have no trouble with doing of die Hetuy Ansbacher Holdings PLCMerchant Banking Oroup i ^ Please reply to: >= 42 Fitzwilliam Square, Dublin 2. Tel: 765144/763065 ‘ Fax: 612035 P.O. Box 887, GrandCayman, BritishWest Indies Phone: (809) 949-4£fr* '& . i 1 * \ ;*V» P.O. flax 1( 7 , Qmut C *yw aa,-Bm uii W m In d ia Please reply to: 42 Flcnvflliam Square, Dublin 2. Tel: 765144/763065 Fas:612035 Fluaw: (SO?) >49-1453/* TUbc CT 4305 F*S.(*»}949.7M (SM ) 949-1247 4th October, 1991. Garrett LO;OOt. 52mZ2 2!!2 L^^£6,•0nm'*** *■ A mw*w ef*•e*ew Fw Oieup. £26,220.39 £15,000.00 £35,000. 00 £ 9.500.00 £ 7,738.00 W e propoae charging intereat on the loan at 3 % in exceaa of Guinneee + M a h o n Limited Baae Rate, fluctuating therewith. The preaent effective rate ie, therefore, 12% per annum, and w e ahall adviae you in future of any upward or downward m o v e m e n t in our , Baa * Rate. TmitmlOwwrCHkmmk IHmnhB«.Oim».tfcUmUml.NM*P. C W m OlHMMMtH.W.Im» increased cost with effect f r o m the data of notification. You shall be at liberty within one m on t h after such notification and without pay ment of any pr e m l u m or penalty to repay the full amount of the facility outstanding together with interest at the rate applying prior to notification. W e are pleased to be of assistance in this matter and enclose a copy of this letter for signature b y your authorised signatories and return, thereby confirming your acceptance of the loan on the terms mentioned. W e shall also require a copy of a Board Resolution authorising the borrowing. Y o u r s faithfully for G U I N N E S S + M A H O N L T D . P. O ' D w y e r L o a n e Officer P.J. Flynn Banking M an ager ?mm - APPENDIX TEN TO EXAMINATION REPORT AS AT 30 APRIL 1978 MAJOR LOANS BACKED BY “DEPOSITS* HELD IN CAYMAN/GUERNSEY TRUST COMPANIES B o r r o w L o u la J a a e a M A O e b t u d la g p r t iU * lO.Robart Wilson A Sons Ltd. 125,000 T I a t ■ D a p a a it C a y a a a * 125,000 O C fM u n w < o ra g r K ennedy M cG o nag le B allagh I n c o r p o r a t in g B e l l B r a n ig a n O ’ D o n n e l l & O ’ B r i e n S O L I C I T O R S 20 NORTHUMBERLAND ROAD DUBLIN 4 TEL 660 9799 FAX 660 9434 EMAIL: intb@kmb.ie www.kmb.ie The Inspectors o f the High Court DX 75 Your ref: C /W 05/N SPM 3rd Floor Our ref: . M O ’S/DF Trident H ouse Blackrock Co Dublin Re: MV Mi 26 N ovem ber 2001 Robert W. Wilson Dear Inspectors, Our client has received your letter o f 16 N ovem ber and has instructed us to write to you in connection with your conclusion. 1. Our client does not accept your conclusion that he w as a client o f Ansbacher. The evidence before you is that the trust w as established not by our client but by a com pany incorporated in Northern Ireland in w hich he w as one o f a number o f shareholders. The trust w as established for the benefit o f our client and his fam ily and it is therefore logical that our client was in receipt o f distributions from the trust. The fact that the trust may have given a guarantee to Guinness M ahon (Ireland) Lim ited (w hich incidentally is not accepted by our client in relation to the loan m entioned, see below ) is not p roof that our client w as a client o f Ansbacher but rather that the trustees considered it appropriate to give a guarantee on behalf o f a beneficiary o f the trust. This is not an unusual power in trusts. 2. The use o f the phrase “his trust” in the fifth paragraph o f your preliminary conclusions is pejorative given that you have, in the third paragraph, accepted the trust w as established by a com pany for our client’s benefit and also for his fam ily. It seem s to our client that you have, in interpreting a set o f facts, ignored the obvious conclusion and instead adopted a perverse and illogical one the effect o f w hich w ill be to hold our client out to public ridicule. The reference to com panies in w hich our client w as associated as becom ing insolvent (w hich is incorrect) confirm s our client’s view s o f your preliminary conclusion. The follow ing additional com m ents are made:3. It is not correct to say that Robert W ilson & Sons (Ulster) Lim ited and Robert W ilson (Ireland) Lim ited becam e insolvent in 1983. In relation to the former com pany, this w as acquired by a com pany controlled by Mr. Seam us Purcell and w hile he sold it so on, the com pany still trades today. In relation to the latter company, w hile it w as placed in receivership, it w as acquired in a m anagement buyout, and changed its name at that tim e. The creditors o f both com panies at the tim e were paid in full. MICHALI. .1. O’SIII-A ROGLR P. BALLAGH Ii Rl Vi I Ii. DIXON KFV1N C. BARRY CORDON JUDGli a s s is t a n t s : f io n a h ln r y a g a th a b . ta y i .or CONSULTANTS: LAURLM L I-. liRANIGAN MARTINA L. O’OORMAN COMMISSIONERS l-'OK OANIS / NOTARIKS PUDI-IC Member ofihe Association of Independent European Lawyers. 4. lh e loan o f £225,000 from GMI was not backed by a Cayman deposit which was subsequently used to repay GMI. The following is tendered as proof o f this:- (a) Robert Wilson Limited wrote to Guinness Mahon on 14 September concerning this facility, £75,000 o f which had, at that date, been repaid and setting out repayment terms for the balance o f the facility. On 31 October 1978 Robert Wilson Limited paid a further £25,000 as a second instalment which sum was acknowledged by Guinness Mahon by letter dated 2 November 1978, a copy o f which is enclosed herewith also. Subsequently Guinness Mahon provided a further facility to our client in a letter dated 26 November 1979. It is extremely unlikely that they would have done so had any funds being outstanding on the earlier facility. You will note also from this facility letter, enclosed herewith, that it was unsecured. On 14 April 1980 our client discharged this latter facility and an acknowledgement to that effect from Guinness Mahon is sent herewith also. (b) It seems very clear from the above that paragraph 4 is not correct though it is acknowledged that our client cannot explain the Central Bank report furnished by you. It is suggested that this report may reflect an error by Guinness Mahon in its information to the Central Bank. (o) It is not correct to say that distributions from the trust were lodged to our client's Ulster Bank, Dublin Account Most distributions were in fact lodged to his account in the Midland Bank in the United Kingdom. (d) Finally, given the public criticism that is likely to be directed to Ansbacher clients our client is surprised that you do not state that he has. since 1935, been tax resident abroad. This was stated by him earlier and as proof we now enclose a copy o f a letter from the Revenue Commissioners o f October 1989. Please be good enough to let us hear from you as soon as possible. Y ours faithfully. Kennedy M cG onagle Ballagh Appendix XV (137) Wilson Bishop Tolley & Co Pty 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to W ilson Bishop Tolley & Co Pty. a) Guinness and Mahon credit committee memo o f 10 October 1978. b) Guinness and Mahon loan decision memo o f 22 July 1981. c) Internal Guinness and Mahon memo o f 27 January 1981. d) Facsimile o f 3 March 1981 - GMCT to Guinness and Mahon. e) Letter o f 2 December 1981 - Guinness and Mahon to Mr RH Tolley. f) Letter o f 7 August 1981 - Guinness and Mahon to GMCT. 1972? Wilson Bishop Tolley & Co. '. Amount: U.S.190,000 tarpon: Working capital Term: 21/6/fr Rote: 2 % over L.I.B.O.R. Security: Suitably Stewed - ‘Equitable Mortgage over property fa Australia. Approved. 1973: • V.ilaon Bldiap Tolley & Co: u ■. Amount: D.M. Purpose: Working capital Rate; 2 % over L.I.B.O.R. Security: Term: i “?,000 Suitably Secured - Equitable Mortgage over property In Australia. 21/6/79. Doted fcr-vA '' 1 V " _Andixxv(137) 7. FEFLENCE _____________ M I N U T E N U M B E R _____________ NAME OF APPLICANT : &M. AMOUNT*- u s &*aSl2f DATE /{^ 1^-7-fr . A c,ccc Cfc e c O q rs ^ . PU.^OSE : T E R M Ic S O U R C E O F R E P A Y M E N T S : 4 I O ^ AfitXjl/ . RATE : C O M M I T M E N T F E E : *// U lJ i > R A T I O N I N D E C I S I O N M E M O . (C o n lin u c t l O v e r l e a f ) : ____ _____ ■ ¥ ■ i MEMORANDUM To: Mr. J. D. Traynor. From: Pat O'Dnper. 27th-January, 1981. Wilson Bishop Tolley, U.S.! Loan 90»000 # I t par annul) D.Ma_Lgan_15QJl0ggi.8_5* gfr artnun>_ Funds placed here 6.M.C.T. Funds placed here 6.M.C.T. U.S.$90,000 9 6* per annum P.M.150,000 0 41 per annum. O ■ •-• • i 23203 HARS E l V'A305 GHCT CP ■ ■ ■ ■■ r.--S; ■ 41:' 02 •** 3 MARCH 1981 ■.* V’ ■6 M 0UBL1N • ATT LOANS DEPT REF WILSON BISHOP.TOLLEY BACK TOT BACK LOAM WE HAVE BEEN ADVISED BY HR TOLLEY THAT HE HAS NOT RECEIVED THE LOAN "k * A6REEHENT FOR 8I6NATURE. I PRESUME THIS REFERS TO A NEW BACK TO. BACK LOAN. IF NOT ALREAOY 8ENT COULD YOU PLEA8E EXPEDITE. i 6UINNES8 MAHON CAYMAN TRU8T ■ 1: 25209 MARS EX 4309 GMCT CP E '■.W •• "i* ’\ •* * ’r* * *k ..i *> •>’* ;>■i-r • • yf‘ V? t .v •• «v . ■ ■■ ‘ Am?: (13-7), ;Gr Ref: PO’D/SC Hr. R. H. T olley.' Managing Director, Wilson Bishop Tolley S Co. Pty. Ltd., 628-630, Bourke Street, MELBOURNE, VICTORIA 3000 Wilson Bishop Tolley ft Co. Pty. Ltd., Jamlla Proprietary L1m1ted _____ Dear Mr. Tolley* ( s^pondei I refer to recent correspondence In connection with the above loans. As the loansare now proving inconvenient to us I shall be obliged 1f you w ill kindly made arrangements/to repay the outstanding lia b ilitie s. Sums of JLJD-M. 303r?70rl0 and U.S.fO ailjS;^ will be required to repay the capital suns plus Interest as at 80th■8eeaabo»v 19 8 1 The amounts In question should be paid Into our accounts at Deutsche Bank-A.6 .. Postfach 2631, 0. 6000 Frankfurt (Main) 1, Account No. 932 6935 and Manufacturers Hanover Trust Company, International Division, 4 New York Plaza, N.Y. 1100 15 Account No. 544-7-23776 under advice to us. The above figures have been made up as follows:- Wllson Bishop Tollqy ft Co. Pty. Ltd. D.M. Loan • % V * S M J •If*' Interest to 2S*h December Wilson Bishop Tolley ft Co. Pty. Ltd. U.S.! Loan Interes t to 20th Peeamber 40tWfc1* •*111 ftl ■ "C l y • 9 9 40 P7T7PP -frl i 654i7V- JKtrfSF9S Jamil a Proprietary Limited O.M. Loan Interest to 20th-Deeember XiM/Wvv Yours sincerely, Pat 0'Dwyer. ■mm—«mmII C—n» ftwfcMwt» ar - 260,000700 a i W .« K23W.95 2**** •'■ mVfi’ -tar' i* * •- s* 7 Q *•■ • ! vrrrjJw; r? r , fcT;‘"^ “-■,*** *VJ <<* ' *• •V/.-r \*.“ . •.•fVn/.rA* ■•'*•* ■_*•**'£ wr vi..-- * ':&v .■• •. */ • ^.V'i * /J“ v\ a. . - ■.• fi<« ---------------- — — • Dear Mike ; I.ttfar to .our,rec»nt.t*lefrkoo» /cscti in enclosing i • . .,•':•:.. ■’.v,';;,., vi^i ......... .•-» •••'* •'». * ^ V \ ' .-r- *T*....- . ...... ««• a) A copy o f the loan account In the name or JamUaPty Ltd;: from ' Inception to data* ' r^e^Ttfrbw: *.«;irjrrT"■• ’ ' b) • •• • •■ . J i s - l'-a y ^ .. -V \ ^ a - V •iiiiu.. v .■ -i d L f c . .7V*.^- ; Copies o f the two lo u acenunta.ln the nr----- * •***•— —-• Tolley Pty Ltd. fromfrnaary W&tddateT - • • « ■ ■ • ■ • t w • •<• • * « ,. Mt) ■«• «\i ■ J O T S ? ." SQfl 30th IUAA j d O h ^iBr«-> vs* •.•■ ■ -*‘ • ■‘4% .*• .♦•.• ^ >v •»>?.-v4V ■ •• ‘ I * *«M • ;■ in the ea se o f Jaalla Fropsrty L la jte d /Ih a v e received a.cheque.."; • requesting .interact debltedto tha acoount on the 30thjuoe, the credit does not y etreflect on the account;;? Interest la being ohaiged on the . «/ S*V** .. ••?..'V. • t•*•i*rrVr^i-Cs*• - - - - - ; ■ ir •> * 1 ' U / * ♦-rT3.i-Ar & i:x-.b-:-v^3^::-:: t''Ty'i<'.i35SQ''v -S *• »■ i t- - V>t.;s- :*V - • *. ^ -» jy^, Tui4-•■/■ ^ »,h.. ,r> ».^ ' '- \ , '•■ . ■-., .1/ 4:f f M ire h **•;r;*l*^T •::7 ^ i S a ^■ Xixf'zxnizjxxi-M - -■i'":. ■ A^iT v ^ «•*v, Js *V <,*• * *J *f *** ••*• ♦' • *■ •••* ••' . ■i. • .; ••. •.••.i. •/ v J.\.* A-f > *•? •:• 4 M I r. p a.tiu A.itiiJS l — M p _ _ •I trust t M » i a & r a « & _ P.m 'tfi*J\C.X w-fisat‘^•’5 '. . *.*».♦ »• V .* • *•". ^ ',, * Vbttps siaotrsly, . * ' ~* •V. ' *' ;■ * : ■ '* * V . ; ; •' ■’ ■; , :* ; . fc!i ■ , ; " v ; ^ /•' V ..,« *• -•••'• .'’^••, *•*».»’•*■• ••.•’!*%,• ••■•*■.*»••.•!«%•“ ••^ • «•*•• •'"i •<•*.•► ,■■ •■*• ♦** •.♦.*■ ■»•,. >*,*‘»•'■v^*’4••„*■ i;i . ' ' • •’/••** • * • •'S f + * 1*•«• -•«■••«• **t *,jfc' t , ^ * r:V - FitO'Dwysr • ••”? - B a n k i n g u ^ g t r — :. .-'. - '.* t. *u *‘,* 4 };v <*• , ' '-r> :- -T v Z s ^ ^ . ■i«►. vvy ■jy■:■***, '.:. -• • .- ^»„.11»....... / * - - - » “ .*■+Vrv--. I• DVt. 'r -. . . . V ... . . . « . . . '. . • rt^i ». * ♦ • • • . • •*% . « . .-- . -r . '"■■*>' . *’ ♦ • « » « • ' . ^ » • .. ‘ .-;.•';’ * •••■'v^•■•■' VV.WV'/VT^I '-1 . .. . *•- ... ., . »%* , ...» ^ . . V '*• / - '. i . . ■ #«r«.. •.• ..." : -. . , , . . 'A*; “ . T' ’ i7. v-. -• •*« ---- • M i '» ( . '•■V# • — ••• ..... • -,r j • . *-«•.yiv’TT*'-. . *__ _ ■,*»'•»*»;* • •’ ••;•* •*• -- ....v.'*'^ pjfH*!.1¥*!*“ > »'*•* •• * fyfiiji. *r». . . *n«n w )i. '*^.’**•+1?+1» J f t i < f i r - -.?■• v** •._!?.?'> r.-•■ «C j*♦,,*... .•j't-^jwSSS? .. '* • ,•{«•to'■'»*•i\ J**'*; ! I # *.**► • • . ^ & ■^ i i *i. . '.,* '1. * ya/ v i» iiw ;., •# *.-»•• , • . ■<• . 1 , f 1. V * * ' .;V • . »' t • '<^ I, •■.».* ^ ■ jV - t * . * «•*■ ......................... < ■% *« . Appendix XV (138) Mr Adolf Franz (Burschi) Wojnar 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr A d o lf Franz (Burschi) Wojnar. a) Transcript o f evidence o f Mr Bernard Wojnar and Mr Christopher Wojnar dated 17 July 2001. b) Letter o f 18 May 1977 - Guinness and Mahon to MW Wallpaper Specialists Limited. c) Internal Guinness and Mahon memo o f re MW Wallpaper Specialists Limited. d) Internal Guinness and Mahon credit memo o f 19 September 1978. e) Internal Guinness and Mahon memo relating to 1978 loan. f) Internal Guinness and Mahon credit committee memo o f 19 January 1977. g) Internal Guinness and Mahon credit memo o f 19 January 1977. h) Internal Guinness and Mahon memo o f 4 January 1978. i) Guinness and Mahon list supplied to Central Bank on back-to-back position as at 30 April 1978. j) Letter o f 24 December 1986 - Mr MJ Pender to Mr BA Ursell. k) Internal Guinness and Mahon memo dated 1988 re Fletcher & Phillipson. 1) Minutes o f MW Wallpaper Specialists Ltd Directors’ meeting o f 7 October 1980. m) Letter o f 2 September 1980 - Guinness and Mahon to MW Wallpaper Specialists Limited. n) Internal Guinness and Mahon memo o f 27th June 1979. o) Letter o f 30 July 2001 - Mr Jack Stakelum to Inspectors. p) Extract o f letter o f 21 February 2001 - Mr Jack Stakelum to Inspectors. UNDER OATH ON TUESDAY, 17TH JULY 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspector: Judge O'Leary Administrative Officer to the Inspectors: Mr. Slevin Interviewees: Mr. Bernard Wojnar Mr. Christopher Wojnar Represented by: Ms. Christian Carroll Orpen Franks 28/30 Burlington Road Dublin 4 1 2 3 4 5 JUDGE O'LEARY: Good afternoon gentlemen 6 and your solicitor, you 7 are very welcome indeed. 8 am one of inspectors appointed by the High Court to 9 carry out and investigation into the company My name is Sean O'Leary, I 10 Ansbacher Limited, which also had another name 11 called Guinness Mahon Cayman Trust and some other 12 names indeed as well. 13 14 We are not carrying out an investigation into the 15 affairs of individuals. 16 investigation and that is not the purpose of the 17 exercise. 18 to identify who the clients of Ansbacher were and 19 for that purpose and for that purpose only we would 20 like to get whatever evidence we can from your good 21 selves. 22 somebody who is not here, I suspect it is your 23 father, but we will go into that with you later on. You are not under We are, however, asked by the High Court A lot of the evidence may relate to 24 25 There are four inspectors but obviously because we 26 are dealing with a large variety of cases not all of 27 them are at every hearing. 28 will be dealing with any conclusions that may arise 29 with this interview and the others will not be I am the inspector that 1 involved in that. 2 doing that conclusion. I will be the person who will be 3 4 It is a very informal procedure except for two 5 matters which are imposed on us, if you like, by 6 legislation. 7 must be under oath and secondly, when the evidence 8 has been reduced to writing by the stenographer, 9 due course your solicitor will contact the solicitor That is the evidence which you give in 10 for the inquiry or vice versa and you will be 11 invited to sign the transcript which is also part of 12 the procedure. 13 14 Unfortunately our solicitor is not here today 15 because an interview is being conducted 16 simultaneously in Wales and she has gone to Wales 17 and myself and Mr. Slevin here, who is an 18 administrative officer, 19 respect of the various local matters here. we are holding the fort in 20 21 I do not know what religion, 22 gentlemen, 23 bible. 24 25 26 27 28 29 A. No problem. if any, you have from the point of view of giving you a 1 2 WERE EXAMINED, AS FOLLOWS, BY JUDGE O'LEARY 3 4 5 1 Q. JUDGE O'LEARY: Sit down there and you 6 might identify yourselves 7 so that the stenographer will know which is which. 8 M S . CARROLL: I think we have done that 9 Christopher at the top of 10 11 the table and Bernard. 2 Q. JUDGE O'LEARY: How do you pronounce your 12 second name? 13 A. 14 3 Q. MR. C. WOJNAR: Woj n a r . I can tell you I looked at it very carefully without 15 being able to ascertain precisely how to pronounce 16 it. 17 interview forgive me. 18 to that anyway? 19 A. 20 4 Q. If I mispronounce it during the course of the I am sure you are well used It would not be the first time. Either of you can answer the questions, there is no 21 difficulty as far as I am concerned in that. 22 purpose of this investigation is to ascertain to 23 what to extent, 24 other person were clients of Ansbacher and to get an 25 understanding of the system by which Ansbacher 26 worked. The if at all, the two of you or any That is really what it is about. 27 28 29 Before going into the details of that could I ask 1 the documents which we have, 2 will get later on as we are going through them, we 3 have a number of documents, 4 every document on which we are going to depend. 5 There is gentleman by the name of Burschi. 6 A. 7 5 Q. 8 A. 9 6 Q. 10 you will get a copy of Burschi Wojnar. Was that your father? Yes. Did he have another name, Adolf something or other, did he? 11 A. 12 7 Q. 13 A. 14 8 Q. 15 Yes, Adolf Franz Burschi Wojnar. Burschi was the name by which he went if you like? That's right. Because in some correspondence and some documents Adolf was used; do you understand? 16 A. 17 9 Q. 18 Yes. I just wanted it clear, I can take that as being the same person? 19 A. 20 10 Q. 21 Yes. That is very helpful indeed. Is your father alive or dead? 22 A. 23 11 Q. 24 A. 25 12 Q. 26 He died in 1993. Was he a good age when he died? He was 63. He was a relatively young man so when he died in 1993. 27 A. 28 13 Q. 29 a copy of which you He was in business was he? That's correct. What business was he in? 1 2 14 Q 3 A Wigoders. 4 15 Q Wigoders ? 5 A 6 7 As? Yes. Was that the only company he owned or were there other companies he owned. A 8 I think within the group there was another one M.W. Wallpaper Specialist Limited. 9 A MR. B. WOJNAR: Priceright. 10 A MR. C. WOJNAR: Priceright Wallpaper 11 12 Specialist Limited. A MR. B. WOJNAR: 13 14 Limited. 16 Q JUDGE O'LEARY: 15 A 18 17 Q 19 Sure . Fletcher Phillipson are the Wigoders shops; are they? A MR. C. WOJNAR: 21 Yes, it is main trading company. 18 Q JUDGE O'LEARY: 23 Main trading company, right. 24 25 I just want to get a general background? 17 22 I will ask you briefly about those. 16 20 Foxrock Securities company formed, A all When was that is it a long established company? It is a long established company, it goes back to 26 one of the -- I think it was one of first companies 27 established in the Free State. 28 19 Q 29 A Seventy or eighty years ago? 1 20 Q 2 A 3 21 Q 4 A MR. B. WOJNAR Yes . 5 A MR. C. WOJNAR Yes . 6 22 Q JUDGE O'LEARY When did you become Has it always been known by that name? Fletcher Phillipson Limited, yes. Are both of you directors of that company? 7 directors. 8 A M S . CARROLL: 1986 I believe. 9 A MR. B. WOJNAR: Yes, '86. 10 23 Q JUDGE O'LEARY: I am not trying to catch 11 you out? 12 A MR. C. WOJNAR: No, no, 13 24 Q JUDGE O'LEARY: Your solicitors have 14 1986. informed us that you were 15 directors of Fletcher Phillipson Limited from July 16 1979 to August 1980 and that you then resigned and 17 wend back there on 2nd May '86? 18 A MR. B. WOJNAR That's correct? 19 25 Q JUDGE O'LEARY Is that correct? 20 A MR. C. WOJNAR Yes . 21 26 Q JUDGE O'LEARY What were the 22 23 circumstances of that? A 24 25 circumstances were we really don't remember. 27 Q All right, anyway that was the reality of the situation? 26 27 A 28 28 Q 29 We have been racking our brains as to what the Yes . What about M.W. Wallpaper Specialists Limited, about that company? what 1 2 29 Q 3 A 4 5 Yes ? I think it was formed in around it would have been late A '70's early '80's? MR. B. WOJNAR: Blanchardstown shop 6 7 8 Yes, was that for the originally? A MR. C. WOJNAR: 9 I think the first trading branch it had was the 10 unit in Ennis in County Clare. 11 formed it I can't.. . (INTERJECTION). 12 30 Q JUDGE O'LEARY: 13 For what reason he According to my information it was set up 14 in the April 1977? 15 A 16 31 Q 17 A 18 32 Q 19 A '77, that would be right, yes, late '70's. Then there was another company Foxrock Securities? Yes . When was that set up? I don't know when Foxrock Securities was set up. 20 wasn't a trading company, 21 only became aware of when Dad died in '93. 22 33 Q 23 A 24 34 Q it was a company that I I see? We didn't have any -- it was not a trading company. We will come back to that in due course. 25 tell me who owned these companies, 26 Phillipson first? 27 A It Would you Fletcher & Fletcher &Phillipson is or was then, I think it 28 still is a wholly owned subsidiary of M.W. Wallpaper 29 Specialists Limited. 1 35 Q. 2 A. 3 My father was the owner of all the shares or nearly all the shares in M.W. Wallpaper Specialists. 4 36 Q. 5 A. 6 Was that always the case? Was he always the main shareholder in M.W. Wallpaper Specialists ? 7 37 Q. 8 A. 9 38 Q. 10 A. 11 Yes? Yes, he was, yes. I see? But he was not always the main shareholder in Fletcher & Phillipson Limited. 12 3 9 Q. 13 A. 14 15 Yes? How did that come about? Because my mother was part shareholder and he bought her shares off her at some stage. 40 Q. 16 They more or less separated and he bought her shares as part of the overall package? 17 A. 18 41 Q. That's right. That seems to be clear from the documents; is that fair? 19 20 A. 21 42 Q. 22 Yes. Did Fletcher & Phillipson come from your mothers side of the family? 23 A. 24 43 Q. 25 A. 26 44 Q. It did, yes. Is your mother still alive? She is indeed, yes. That is the background. Back in 1977 what age were 27 the two of you in 1977, to put it in its proper 28 context? 29 1 Q. It is 24 years ago. 2 A. Yes, 3 Q. You are now 45; is it? 4 A. Yes . 5 Q. And you were? 6 A. MR. C. WOJNAR: 22 . 7 Q. JUDGE O'LEARY: 22? 8 A. Yes . 9 Q. Were you working in the business at that stage? 10 A. MR. B. WOJNAR: We would have been, 11 Q. JUDGE O'LEARY: You were working in the 24 years ago, so, 21 I was. yes business since you left 12 13 school? 14 A. Yes . 15 Q. Would you have had a position of authority in the firm at that stage? 16 17 A. MR. C. WOJNAR: No, we would have been the warehouse I think at 18 19 that stage or working in the shops on the floor. 20 had no input into it. 21 52 Q. JUDGE O'LEARY: 22 I had figured that was in fact the case? 23 A. 24 53 Q. Yes. Around that time, that company M.W. Wallpaper 25 specialists Ltd borrowed money from G.M.I., 26 and Mahon; do you know anything about that? 27 A. 28 54 Q. 29 We No. Would you have been consulted about it? Guinness 1 55 Q. I wonder, Mr. Sievin, would you show the gentlemen 2 pages 49, 50 3 am going to do while you are looking for those pages 4 I am going to go and get my glasses because I left 5 any glasses outside. (Exhibit l)and 51 (Exhibit 2). What I 6 7 Which of you or is it somebody else who was the 8 executor of your late father's estate? 9 A. 10 56 Q. The executor was Mr. Jack Stekelum. I see. Here is a situation at page 49 (Exhibit 1) 11 you can see that a loan was being been sought, 12 been sought by the company and that was a letter of 13 offer; do you see that? 14 A. 15 57 Q. 16 had Yes. You can see that in the security that was given, a security for the loan is on page 50, 17 18 19 "... we shall require a guarantee completed by Mr. Burschi Wojnar. The relative form of Guarantee is enclosed for completion and return." 20 21 If you look at the next page 22 see that this is an internal document which we have 23 been given by G.M.I., by Guinness and Mahon, 24 if you like their working document which gave rise 25 to the letter of offer. 26 security is a guarantee to be signed by you father 27 and then other relevant comments "Suitably Secured", 28 do you see that? 29 (Exhibit 2) you will that is You can see that the 1 58 Q. Suitably secured we have been informed by G.M.I. in 2 that context means that somewhere there was a sum of 3 money which was being used to back that facility and 4 that sum of money was external to Ireland. 5 have been in the north of Ireland, 6 in the Channel Islands or it may have been in the 7 Cayman Islands. It may it may have been Do you know anything about that? 8 A. MR. B. WOJNAR: No. 9 A. MR. C. WOJNAR: No. 10 5 9 Q. JUDGE O'LEARY: You could not obviously 11 pass any comment on that 12 because you do not know anything about it? 13 A. 14 60 Q. No. Fair enough. If you look at the next page which is 15 page 52 16 at this stage now. 17 is information on that concerning other people, 18 nothing at all to do with your company you 19 understand, 20 similarly do the same when they came into us. (Exhibit 3), a copy of which you should have I have excluded from that, there I have blanked that out and I would 21 22 This is a 1978 application and it says; 23 Wallpapers Limited, Amount £87,000". 24 was at the time that your father was purchasing your 25 mothers share. 26 Phillipson". 27 goes through the personal guarantee of your father 28 supported by a deposit of the shares. "M. W. This I think "21,804 shares in Fletcher & "For a term of three years" and it 29 "In addition, this facility is Suitably 13 1 2 3 That is very specific. 4 suitably secured, 5 this somewhere of £37,500; do you know anything 6 about that? It just does not say it says there is a backing for 7 A. MR. B. WOJNAR: No. 8 61 Q. JUDGE O'LEARY: Fair enough. 9 at page 56 If you look (Exhibit 4), 10 this in fact is an internal memo explaining what the 11 deal is about. 12 take away with you, there will be no difficulty 13 about that. 14 client of Jack Stakelum and a close personal friend 15 of Harry Lindsay, 16 Fletcher & Phillipson and has been for many years 17 and it goes through the various things, 18 mothers shares, his shares and Christopher had a 19 share of 900 at that stage? We will give you copies of these to It describes your father as being a substantial shareholder in shows your 20 A. MR. C. WOJNAR: Yes. 21 62 Q. JUDGE O'LEARY: Would that be right would 22 you say? 23 A. 24 63 Q. 25 A. MR. B. WOJNAR: No . 26 64 Q. JUDGE O'LEARY: Attached is a summary of That's correct, yes. I don't think Bernard had any share at that stage? 27 some financial data for 28 the company and then they go on down and say that 29 1 2 "B.W. has agreed as part of an overall settlement with his wife to acquire her shareholding in Fletcher & Phillipson Ltd for the sum of £87,500... ." 3 4 5 6 That is the circumstances. Then it says at the end; 7 "The security to be made available to us would be the personal guarantee from B.W. who will lodge as security 12,296 shares which it holds in Fletcher Phillipson Limited. 8 9 10 In addition the facility will be suitably secured to the extent of £37,500." 11 12 13 Do either of you know anything about that? 14 A. MR. B. WOJNAR: No. 15 A. MR. C. WOJNAR: No. 16 65 Q. JUDGE O'LEARY: As you appreciate I have 17 to ask you? 18 A. 19 66 Q. 20 Sure. If you don't you don't, matter, 21 A. 22 67 Q. I am not pursuing you on the that is the reality. Sure. Look at page 73 (Exhibit 4). This is another 23 document but it is in respect of a different company 24 it is a slightly different date, 25 In 1977 apparently there was some transferral of 26 residence, 27 father and mother separating I don't know, because 28 it is a few years earlier than the £87,000 but there 29 was a request for a loan, an earlier date. whether that has anything to do with your the purpose of: 1 "To facilitate transfer of residence. Bridging Finance... £9,000... . A suitably secured situation will exist in due course." 2 3 4 In other words what they are saying there is that 5 money will be put on deposit somewhere in due 6 course, 7 anything about that? 8 A. 9 68 Q. it was not there in 1977; do you know No. If you look at page 76 (Exhibit 6) just for the sake 10 of completeness. 11 document backing up what I have just shown you, you 12 can see it says down at the end; That in fact is the internal 13 "A suitably security situation will exist in due course." 14 15 16 It is precisely the same thing except in a more 17 informal way. 18 year, 19 was renewed for a year, page 77 20 year it was renewed, 21 where it says "suitably secured", 22 has gone from a situation where it was to be 23 suitably secured in the future to a situation where 24 it is actually now suitably secured. 25 some money was put on deposit between 1977 and 1978, 26 which was used to back this loan; do you know 27 anything about that? 28 29 A. Interestingly enough the following that was 1977, the following year in 1978 it MR. C. WOJNAR: (Exhibit 7) after a the £9,000. No. You can see there in other words it Presumably 1 2 If you look at page 78 3 (Exhibit 8)? 4 show me page 78 before you give it over if you would 5 not mind Mr. Slevin. 6 before you look at it because it would not make much 7 sense to you. 8 distance, 9 the names of companies and individuals, I should explain to you -- could you Yes, excellent. Page 78, Could I just show you from a I have a schedule and that schedule has 10 do with you at all, therefore, 11 them to you. nothing to I do not want to show 12 13 There are lists of balances, 14 in Guernsey. 15 While it looks an odd document that is the reason it 16 looks an odd document, because we have taken out the 17 things that are not relevant to you. some in Cayman and some Only one of them is relevant to you. 18 19 You can see there that somebody in Guinness and 20 Mahon diligently produced a list, 21 point in having all this secrecy if they then go and 22 produce a list, but they did, giving us all the 23 information and it shows that there was a deposit in 24 Cayman of £2.4 million, 25 of which Foxrock Securities had £9,269. I do not see much in Guernsey of £1.3 million, 26 27 That obviously the same suitably secured. 28 again might be nothing to do with Ansbacher but it 29 is there and it is suitably secured and it is in That 1 Guernsey. 2 to you in due course. 3 that? I will explain the significance of that Do you know anything about 4 A. MR. B. WOJNAR No . 5 A. MR. C. WOJNAR Sorry, no. 6 7 0 Q. JUDGE O'LEARY Fair enough. Here is 7 where the matter becomes 8 relevant to our inquiry because could I explain to 9 you that we are not really interested in any money 10 that was out in Jersey or Guernsey, 11 relevance to us because we are investigating 12 Ansbacher which was in Cayman. it is of no 13 14 For reasons which we do not quite understand money 15 that was in Guernsey and Jersey was in later years 16 routed through the Cayman Islands and Ansbacher. 17 Often without the knowledge or approval of those 18 involved. 19 A. 20 71 Q. Do you understand? Yes. Sometimes people became clients of Ansbacher without 21 them even knowing they were clients of Ansbacher, 22 they thought they were clients of somebody outside 23 in Jersey or Guernsey. 24 can show that it ultimately went through Ansbacher 25 or Guinness Mahon Cayman Trust, 26 that time. 27 (Exhibit 9)? 28 A. 29 72 Q. Our interest is purely if we as it was called at If you look at page 99 and page 100 We just have page 100. You only have page 100. Mr. Slevin, I think you 1 better go and get for them the top portion. 2 a very important document so I am going to wait 3 until Mr. Slevin copies it. 4 MR. SLEVIN: The top line is it? JUDGE O'LEARY: What I want excluded is 5 7 3 Q. 6 7 This is the names of people at A and B but leave in the headings A and B. 8 9 That is in fact a list which is divided into 10 different sections and you will see the sections in 11 due course. 12 and Mahon to a man in Guinness Mahon & Co. in 13 London. 14 Pender, M.J. 15 by the name of B.A. Ursell, It is a letter from a man in Guinness The man in Ireland is a man by the name of Pender and the man in London was a man U-r-s-e-1-1. 16 17 On 24th December 1986, Mr. Pender in Dublin wrote to 18 Mr. Ursell in London and said here are a list of 19 various deposits which we have under various 20 headings. 21 22 One heading was "As asked I list herewith particulars of accounts for which we hold banking deposits from G.M.C.T." 23 24 That is Guinness Mahon Cayman Trust or Ansbacher 25 and he lists 20 or 30 accounts there. 26 heading; 27 28 29 "Resident accounts for which we hold deposits from G.M.C.T., duly hypotheticated." Then a second 1 2 3 "Resident accounts for which we hold a direct deposit from a Cayman company." 4 5 And fourthly; 6 7 "College Trustee clients for whom College have arranged backing deposits here through G.M.C.T." 8 9 So, College Trustees was a company in Guernsey, 10 think it operated in Jersey too. 11 Guernsey, 12 Mahon and it was that company that directed its 13 funds through Ansbacher. I Basically in who had a connection with Guinness and 14 15 One of the company's listed as a College Trustees 16 client for whom College have arranged backing 17 deposits here through G.M.C.T. 18 Phillipson. is Fletcher and You will see that when it comes in. 19 20 Without understanding that it would not mean 21 anything to you at all, we will wait until Mr. 22 Slevin brings in the copies. 23 24 Can I have a quick look at those now, Mr. Slevin. 25 Yes, that is fine. 26 MS. CARROLL: 27 28 29 (Same Handed) (Exhibit 9)? There are two documents here. 1 only giving you the first page because it makes no 2 sense with out that. It says; 3 "As requested I list particulars of accounts ..." 4 5 6 Apparently there were four different categories of 7 accounts which he designated as A, B, C, and D. 8 A was a list of people which did not include any of 9 your companies. 10 11 B was a similar list which did not include any of 12 your companies. 13 not your company and then D was a list of ten 14 different companies, 15 Phillipson. 16 you were on the board of the company; 17 correct. C was just one company which was one of which was Fletcher and This is 1986. At that stage both of is that 18 A. MR. B. WOJNAR: Yes. 19 7 4 Q. JUDGE O'LEARY: You had gone on the board 20 of the company on 2nd May 21 1986? 22 A. 23 75 Q. 24 A. No, 25 A. MR. C. WOJNAR: No. 26 7 6 Q. JUDGE O'LEARY: You see apparently your 27 Yes. Do you know anything about that? I don't anyway. company had at that stage 28 borrowed at least to the extent of £53,000 and there 29 was a backing deposit for it. Outside in College 1 Trustees and sent through them through Ansbacher 2 there was £53,000. 3 it of course in 1977, you were young fellows in 1977 4 but at this stage you are getting to the stage where 5 you are beginning to take obviously a more central 6 role in the business. 7 It was fairly late on now before Dad died, 8 before he died, 9 business in terms of the financial affairs of the 10 11 I find it strange, I can accept or close that we took any major role in the company. A MR. B. WOJNAR: 12 On the financial affairs, dealing with banks or 13 anything like that, we had no input into it really 14 until after Dad died. 15 A MR. C. WOJNAR: 16 basically. 77 Q JUDGE O'LEARY: 19 I can understand that, so, you are saying to me that 20 you know nothing about that. 21 A I know nothing about that, no. 22 A MR. B. WOJNAR: No. 23 78 Q JUDGE O'LEARY: All right. 24 We did what we were told 17 18 He ran the company. We will leave that aside for the moment. 25 Mr. Slevin, will you show the gentlemen, 26 (Same Handed)(Exhibit 10) this is a 1988 document. 27 The actual date is quite badly written down at the 28 bottom right-hand corner but you can actually see 29 that the review date is 31/3/1989. page 110. Obviously it is 1 March 1988, 2 you see that? that is typed, review date 31/3/1989; do 3 A. MR. C. WOJNAR: Yes. 4 7 9 Q. JUDGE O'LEARY: In the middle on the 5 right-hand-side and you 6 can see down at the bottom "Credit Committee" 7 you see 88 there but the precise date is not easily 8 distinguishable? 9 A. 10 80 Q. Yes. This was a borrowing of £100,000 by your company, 11 which was guaranteed by your father. 12 the question of whether it was back to back or 13 anything like that for the moment, 14 that in 1988 you had £100,000 borrowed? 15 A. and Leaving aside do you remember 1988? I remember there was loans taken out, that we 16 were borrowing at the time because I think that was 17 around about the time we were buying Longmile Road, 18 was it, 1988? 19 A. MR. B. WOJNAR: It would have been, 20 A. MR. C. WOJNAR: We moved from one premises 21 yes. to another and we were 22 buying I think a freehold premises in Longmile Road. 23 That could be about the time. 24 81 Q. JUDGE O'LEARY: 25 That was not the stated purpose of the borrowing 26 if you look at that. 27 tell banks precisely the right reason but the 28 purpose for the drawdown was working capital, 29 payment of invoices? I know people do not always 1 2 82 Q 3 A Yes. What I remember about that was that there was 4 a company who had been acting, 5 International Trade Finance. 6 83 Q 7 A I think its name was Yes? They had been acting when there was a purchase made 8 they would pay the supplier and then we would pay 9 them back in a few months. 10 84 Q 11 A I see? International Trade Finance got into difficulties or 12 went into liquidation, 13 went wrong or went badly for them, that would be my 14 recollection of that type of facility or borrowings, 15 it was to continue that. 16 85 Q they lent money in areas that Yes, but you can see that under guarantee of your 17 father, under security, 18 is another of these terms that we are told by 19 Guinness and Mahon means that there was money on 20 deposit somewhere. 21 years previously there had been money on deposit in 22 College Trustees but through them in the Cayman 23 Islands? 24 A 25 86 Q 26 27 "considered adequate", that Of course we now know that two Yes . Was that £100,000 rolled over for a number of years or was it paid back? A My memory would be that they paid the supplier and 28 then we had to pay them back. 29 day or a 120 day limit, I think it was a 90 it was a short term 1 2 87 Q 3 A 4 The term of the facility is down here as one year? One year was it, yes. of it, I can't remember the detail sorry. 5 88 Q 6 A I believe our bankers were... 7 A MR. B. WOJNAR A.I.B. 8 A MR. C. WOJNAR Allied Irish Banks. 9 89 Q JUDGE O'LEARY When you borrowed from Who was your banker at that stage? 10 Guinness and Mahon it was 11 a bit outside your normal banking, 12 wrong with that? 13 A 14 90 Q 15 A It would be, yes. When did you stop borrowing from Guinness and Mahon? MR. B. WOJNAR: 16 17 We have never dealt with Guinness and Mahon anyway. A MR. C. WOJNAR: 18 No, I have never had any dealings with Guinness and Ma h o n . 19 20 there is nothing 91 Q JUDGE O'LEARY: 21 Were Guinness and Mahon owed money by the company 22 when your father died? 23 A MR. B. WOJNAR: No . 24 A MR. C. WOJNAR: No, 25 92 Q JUDGE O'LEARY: So it was some time before 26 I don't believe so. that ? 27 A MR. C. WOJNAR: It wa s , y e s . 28 93 Q JUDGE O'LEARY: It was some time after 29 1988 and before 1993? 1 2 94 Q. I wonder could you find out that detail for me. 3 When was the last time he borrowed from Guinness and 4 Mahon? 5 A. 6 95 Q. 7 Okay. And you might also find out how did you pay back that £100,000? 8 A. 9 96 Q. 10 A. 11 97 Q. Sure, all right. That may have been the last borrowing? Right. I do not think we have come across a later borrowing 12 than that. 13 it could have been paid back out of profits, but 14 also could have been paid back by the back to back 15 facility; do you understand? 16 A. 17 98 Q. 18 We do not know the bank was paid back, it Yes. Did you at any time know that there was money abroad, forget for the moment where it was. 19 A. MR. B. WOJNAR: No, 20 99 Q. JUDGE O'LEARY: Did you know there was 21 definitely not. money in the Channel 22 Islands as I am sure your father probably thought it 23 was ? 24 A. 25 100 Q. 26 A. 27 101 Q. 28 29 MR. C. WOJNAR: No. Did you ask Mr. Stakelum about it. No. Have you ever discussed the matter with Mr. Stakelum? 1 first letters in relation to the Moriarty Tribunal 2 came u p . 3 102 Q 4 A MR. B. WOJNAR: We have. 5 A MR. C. WOJNAR: Yes. 6 103 Q JUDGE O'LEARY: Along the same lines as Have you given evidence at the Moriarty Tribunal? 7 8 what I have given you? A 9 Along the same lines but obviously there is a lot more detail here. 10 We have not been privy to the documents. 11 104 Q 12 A 13 105 Q What happened the money that was out there? I couldn't tell you. If you can't tell me it would be very hard for me to 14 know. 15 able to give you information. 16 matter with Mr. Stakelum? You see, Mr. Stakelum is a man who might be Did you discuss this 17 A The matter o f ...? 18 A MR. B. WOJNAR: Of these accounts? 19 106 Q JUDGE O'LEARY: Yes, of security of the back to back loans? 20 21 A No. Because I didn't have this information, 22 never seen this before, 23 have seen it. 24 107 Q I have this is the first time I The only information we have, hard information, if 25 you like, 26 which is a direct statement by Guinness and Mahon 27 that College Trustee had funds which were deposited 28 through G.M.C.T. 29 going to make that statement unless there is some is the second last thing I showed you, Nobody in Guinness and Mahon is 1 basis for it. 2 be tribunals and inquiries like this 10 or 15 years 3 later. 4 whatever it was? 5 MR. C. WOJNAR: 6 108 Q 7 They did not know there was going to We can take it it was their best shot, Yes. Did you get any money from an unexpected source when you father died. 8 A MR. B. WOJNAR No. 9 A MR. C. WOJNAR No . 10 109 Q JUDGE O'LEARY Did anyone tap you on the 11 shoulder and say "By the 12 way I have £50,000 that really was your fathers and 13 here is £25,000 each for you? 14 A MR. B. WOJNAR No. 15 A MR. C. WOJNAR No. 16 110 Q JUDGE O'LEARY Did anyone suggest to you 17 that there might possibly 18 be such money? 19 A MR. B. WOJNAR No, no one did. 20 A MR. C. WOJNAR No. 21 111 Q JUDGE O'LEARY Who was your father's 22 financial advisor? 23 A MR. B. WOJNAR: Ja ck . 24 A MR. C. WOJNAR: I would say Mr. Stakelum 25 26 27 wa s , y e s . 112 Q JUDGE O'LEARY: I think you should seek to increase your information 28 from Mr. Stakelum for the purpose of giving 29 information to me, what you do with it is your own 1 private business. 2 that I have I probably could come to a conclusion 3 that your father was a client of Ansbacher, 4 that information. 5 either of you were as well and until I know what 6 happened the money I will have to keep digging? 7 A. 8 113 Q. 9 You see, based on the information based on I have to satisfy myself whether Sure. That is my problem. any more, I actually do not want to dig I am quite happy if I could be sure that 10 was it. 11 where somebody in Guinness and Mahon said that there 12 was cover for a £53,000 in 1986 and apparently there 13 was 14 considered adequate note in 1988. At the moment I am left in a situation still cover there in 1988 because of the 15 16 We know the 17 sense that somebody does not pull a figure like that 18 out of the blue and we know that in 1988 there was a 19 loan or a considered adequate basis. 20 to try to find out who got the money, maybe it was 21 your mother? 22 A. 23 114 Q. 24 '86 one, that is very definite in the I really have No. Do you know whether your father ever had a trust in the Channel Islands? 25 A. MR. B. WOJNAR No . 26 A. MR. C. WOJNAR No. 27 115 Q. JUDGE O'LEARY You didn't know it or you 28 29 don't know it now? 1 MR. C. WOJNAR 2 116 Q JUDGE O'LEARY Do you know it now? 3 A MR. B. WOJNAR No . 4 A MR. C. WOJNAR No, we still don't know 5 it. 6 117 Q 7 A JUDGE O'LEARY: Can you see my problem? I can appreciate where you are coming from but I 8 can't give you any more information. 9 business. 10 118 Q Dad ran the We didn't get involved in the affairs. What I am looking for now is I am looking for an 11 explanation as to what happened the money after 12 1986. 13 that would not make them a client of Ansbacher but 14 if the account was operated that would make them a 15 client? 16 A 17 119 Q If the money was just taken out by somebody We weren't beneficiaries of any money. I wonder would you investigate the matter and come 18 back to me, 19 no need to come back and give evidence, 20 solicitor? in writing I am talking about, there is through your 21 A MR. B. WOJNAR Certainly. 22 A MR. C. WOJNAR All right. 23 120 Q JUDGE O'LEARY Do you understand the 24 point I am making now that 25 in 1986 Mr. Pender, who was not a foolish man, makes 26 a very specific reference, 27 considered adequate and I know that Mr. Stakelum 28 from time to time thinks that people put down 29 considered adequate for other reasons, but this is he just does not put down 1 actually very specific. 2 there and there is backing deposits for it in 3 G.M.C.T. 4 and what happened to it. He says there is a list I just want to know whose deposit it was 5 6 Maybe I can assume they were your fathers deposits, 7 if there is not another explanation because who else 8 would be giving that kind of security. 9 unsatisfied with regard to what happened 10 subsequently. 11 them subsequently, 12 gentlemen, 13 client of Ansbacher, 14 happened to the money, 15 me, 16 nothing to do with me. I am left I am only interested in what happened I want to make that clear, to find out is there anybody else a I have no interest in what that has nothing to do with if people spent the money so be it, that is 17 18 I am not involved in a tax investigation, 19 not my purpose but I do want to satisfy myself that 20 if your father was a client of Ansbacher that it 21 ended there and there was nobody else a client of 22 Ansbacher because I am asked by the Court to make 23 that list; do you understand? that is 24 A. MR. B. WOJNAR: Yes. 25 A. MR. C. WOJNAR: Yes. 26 121 Q. JUDGE O'LEARY: There is just one other 27 matter that I want to 28 bring to your attention and it is page 61 29 11). Page 59 and 60 (Exhibit 12) as well. (Exhibit Do you 1 2 3 loan, no. 4 A MR. B. WOJNAR: No . 5 122 Q JUDGE O'LEARY: If you look at page 61 6 (Exhibit 11) you will see 7 that you were at the board of directors meeting that 8 sanctioned it? 9 A MR. B. WOJNAR: 10 T h a t 's right we were th er e. 11 A MR. C. WOJNAR: Yes . 12 123 Q JUDGE O'LEARY: And you do not remember 13 it? 14 A MR. C. WOJNAR: I don't remember it, no. 15 124 Q JUDGE O'LEARY: Is Mr. Stakelum still on 16 the board of your company? 17 A MR. B. WOJNAR: He is indeed, 18 125 Q JUDGE O'LEARY: I wonder would you 19 investigate the matters with him? 20 21 Do you know a Mr. Joe 22 Seely? 23 A 24 126 Q 25 A MR. C. WOJNAR: 28 29 Yes . Who is he? MR. B. WOJNAR: He was working for or with Mr. Stakelum in his 26 27 yes. company. He was a secretary if I am correct. 1 2 127 Q. JUDGE O'LEARY: I wonder would you take 3 that, it is an unnumbered 4 sheet because I only discovered it after the numbers 5 had been put on. 6 Stakelum 7 A. 8 128 Q. 9 Does Mr. Seely still work with Mr. (Exhibit 13)? MR. C. WOJNAR: No. I wonder could you find out about that for us? This is an internal G.M.I. memorandum. 10 "M.W. Wallpaper Specialists. Would you please transfer a sum of £56,000 out of "E" special and place the funds on a separate account at Guinness & Mahon Base Rate. We are charging interest on the loan at Base Rate of 3%. Please value the entry 15th June, 1979. 11 12 13 14 15 Above instructions received by Joe Seely by phone." 16 17 That would appear to us to be the creation of the 18 special back to back facility at that time. 19 "E" special, apparently there was an account 20 "E" Special, that may have been a Guinness Mahon 21 Cayman Trust account and £56,000 was to be taken out 22 of that and put in a separate account. 23 have not been in the name of M. W. Wallpaper 24 Specialists or in the name of somebody else, 25 could well be College Trustees RE: Guinness Mahon 26 Cayman Trust. 27 whether you ever had £56,000 on deposit? 28 29 A. MR. C. WOJNAR: It may well it Will you check the record as to Yes. 1 129 Q 2 through your solicitor? 3 A 4 130 Q 5 MR. C. WOJNAR: We will of course. You might also inquire from Mr. Stakelum what is the meaning of that? 6 A MR. B. WOJNAR: Right. 7 131 Q JUDGE O'LEARY: Now, 8 gentlemen, all I will say to you is thank you 9 very much for your cooperation, you are under an 10 obligation to cooperate and you have so far 11 fulfilled that obligation, 12 it at all but you are also under an obligation to 13 give us such further information as we require and 14 we do require that additional information? I have no complaint about 15 A MR. C. WOJNAR: Very good. 16 A MR. B. WOJNAR: Thank you. MS. CARROLL: Thank you. 17 18 19 When might we get the transcript. JUDGE O'LEARY: 20 The transcript will be available in a week or so, 21 it will be available for signature, 22 will cost £60 because that is outside our control. 23 That can be arranged with Ms. Cummins, 24 M s . Cummins. 25 M S . CARROLL: No. 26 JUDGE O'LEARY: Ms. Mary Cummins, 27 28 29 a copy of it do you know ring her here rather that Mr. Slevin, she will be back tomorrow. 1 2 that for you. I will need 3 the answers to the questions that I have given you 4 because we are coming to the end of our 5 investigation. 6 MS. CARROLL: Certainly. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN CONCLUDED Thank you. P727Lr7h modrnb?v (arty/bl I The S e c r e ta r y , M. W. Y a llp a p e r S p e c ia lis t s L im ite d , 1 7 , C ly d e R o a d , . . •• B a lls b r id g e , D U B L IN 4 . ' . Dear S ir , ' • • . F o l l o w i n g r e c e n t d i s c u s s io n s , v e w r i t e t o c o n f i r m t h a t we a r e p r e p a r e d t o m ake a v a i l a b l e t o y o u a f a c i l i t y , s u b j e c t t o t h e f o l l o w i n g te rm s and c o n d it io n s : (1 ) I f . W. W a llp a p e r S p e c i a l i s t s L im ite d . ■ • B o rro w e r: (2) Amount: • (3 ) P u rp o s e ; (4 ) ■ .• T e rm ' ■ • (5 ) D ra w d o w n : •* (6 ) . ‘ _ ' . . • . In te r e s t: ' • . ‘ ‘ . Tlagnm *: Man. CkiM*. TatemDM. .5^*'*^ H P**"11 Kt&antt umbti;7tmtt Onto. Dublin1. Aoumbtrof th*OiImimPmi Q/oup. g lO .'v w n n I r i s h fi. ’ fT e n T h o u s a n d P o u n d s ) • . T h e fu n d s a r e - t o b e u t i l i s e d b y * y o u I n t h e f o r m o f w o r k in g c a p i t a l . I n a c c o r d a n c e w i t h n o r m a l b a n k in g p r a c t i c e , a l l fu n d s a d v a n c e d a r e r e p a y a b l e o n d em and, b u t i n a n y ■case n o t l a t e r t h a n 3 1 s t .K a y 1 9 7 8 . . + • ‘ , ' The f a c i l i t y I s t o be ta k e n up i n . t h e f o r a o f a L o a n .A c c o u n t i n y o u r name on c o m p le t io n o f t h e n e c e s s a r y d o c u m e n ta t io n . . ’ V e p ro p o s e c h a r g in g I n t e r e s t o n t h e f a c i l i t y a t 1 5 f % * p e r annum f i x e d . In t e r e s t s h a l l b e d e b ite d t o th e .a c c o u n t, a n d becom e p a y a b l e b y y o u on t h e 3 0 t h J u n e , 3 0 t h S e p te m b e r , 3 1 s t D e c e m b e r a n d 3 1 s t M a rc h a n n u a l l y and a t m a t u r i t y o f t h e Loan. We s h a l l a p p l y t o you Im m e d ia t e ly a f t e r t h e a f o r e m e n t io n e d d a te s f o r paym ent o f i n t e r e s t . . - Continued... CtufanMSJoImM.ftiitirtHii faMHlMWrtctwsJ. DtJRpOSE: - jjrM & SOURCE O P REPAYM ENTS: * “ ATE: (5 * * * " IfC Q lA * ^ TM ENT F E E : ’& /• • w y CXIPJTT; . w e J tt . * * »* • , ' • " *,* •* ** * r •• “ • ‘ • % . ' t* • • ••* • , *, • . «» ••%*••• /f -■ U . k ". . • « 4 * * 6 • * • b r a \ * . * im 5^ * . « U ’ ’a ' •* ? I '' • Q f r tt i . ' •* . • * . ••• ;• • •• . * %• *'“•*• .** ■** . * .• « . * . .. ••. • * • i •' • *■ ttEW DATE:" IER R E L E V A N T C O M M E N T S F O R O R PO R A T IO N I N D E C IS IO N M EM O: itin u ed O v e r le a f ) ’ . . . . . . . *f f S r £L / . . * •' A U T H O R IS E D .. Append. >31, • m . ' Amount: £87,000 Purposes To pureho* 21*804 Show In Elafchtr & Phillipson; Limited, Tame ' 3 years * . IU{)qipi«Nfci«nui( ii« rniAi iwnfhly In tin nm of £1,500 par month far the fin* throe years and at the and of rfwe years the account would be reviewed. ■ ■ ^ • Rate* • ' 3% ever bate quarterly. Security: ^ ■ The security to be mode available to us would be;~ . 21,000 Shares la Flehcher & Phillipson limited ' Personal Guarantee of Burschl Wojner, Esq supported by the deposit of 12,296 shares In Fletcher &Phillipson which he holds. . In addition, this facility Is Suitably Secured to the extent of£37,500 • ^Slgnett1 1'J*x D a te d \ ^ Apmaixxviasmm _ r' He: Burschi Wojnar, M.W. Wallpaper Specialists Limited, Fletcher & Phillipson Limited. f,A r*\ Burschi Wojnar.(B.W.) is a Client of Jack Stakelum and a close personal fjriend of Harry Lindsay. He is a substantial shareholder in Fletcher fc Phillipson Limited (Eatail Wallpaper Merchants) and has been for many years. The issued capital of the Company is 35,000 Ordinary Shares of £1 each and they are held as follows: • • « 1 Mrs. D.V. Wojnar Burschi Wojnar . % Christopher Wojnar (Son) 21,804 12,296 900 ♦ ' 35,000 Attached hereto is a summary of some financial data for the Company... A valuation of the freehold and'leasehold properties was carried out by Sherry & Sons in November 1977 and this valuation put a figure of £26,000 on the leasehold properties and £110,000 on. ' the freehold prope: y. • A.I.B. have a mortgage on Capel Street nj £80.000. ' • ' B.W..and his wife are now separated. •. ’ In April* 1977' a new Company was Incorporated called M.W.' Wallpaper Specialists Limited, which also carries out Hotail Wallpaper . • Merchantlng business and B.W. is Managing Diredtor of both Companies. The draft Accounts for the ten months to 31st May of M.W. Wallpaper Specialists' Limited show that on a turnover of £85,836 .a net profit of £27,097 was earned. The Company, . which has leases of two retail outlets at Ennis' and . Blanchards town, continues to trade very' well. . B.W. has agreed as part of an overall settlement with his wife - ' to acquire her shareholding in Fletcher & Phi Hips on Limited for the sum of £87,500 and It is his intention that this shareholding be acquired by M.W. Wallpaper Specialists Limited. We have been asked to make available the finance. The proposal to us is as follows: 1 • Sum Required: £87,500. Period: 3 Tears. Repayment: Repayments would be made monthly in the sum of £1,500 per month for the first three'years and at the end of three years the account would be reviewed. ' Interest: Interest would be paid quarterly. Security: . . The security to be made available to us would . be the personal guarantee from B.W. who will lodge as collateral 12,296 shares which he * SSCSQCSZ^ f-wiihaa Faxrock SecurfKw Limited: Amount: £9,000 P urpott To fixllT tato transfe/- o f mldsnc*. "Brlcfefng FinanceM. Term; Repaymenf from funds to ba road* available end o f M arch, 1977. Rato; 3% over Bom Drawdown: By w ay of loan as cndwhen required. Security! 't^oranhM of Mr. W apiar. A suitably xeeund tlhtoH on w ill w d st In uue cause. K0VI0W 1 ai/1/1978. ‘ « RtcanniMMt !< f * % ‘ . LOAN ' DEClSlON_ .......................................................................... " • a ^ R E N C E : __________ ' • y ' i • .... MIWUTE NUM BER:----------- .-------- * jrfose: • .. . - D A T E : jj? S’, / , h x -R fiC # AM E O F .A P P L IC A N T : tfO U N T : . O R A _ N p jt/M ' * *' ‘ ' a • . * * . •*" « ’ • • • ../Cr f ^ c f '' fcuedsfc i R M . t , SO U RC E ’O F ;R E P A Y M E N T S :’ ’ . . . * I / - * - A to p iJ Q i oS o S » .: a h ' fito & m - B4M ITM ENT F E E : • ' a j •+ .* # * * * ' • • • •••*•••;:. .. y // ' ^ W ' " -s o - ' * * & ' ' A lfD O W N : . . “• '** . CU21ITY: i, # I* 7 • . . . . s */v •* i teW DATE: f- ‘ - *\ •••~ \ w v «• • •• ,> • *v" * .*.•; nt.*« : * .v- r-"t :*r-*• • • •v Vl * 7 a » 659: Foxrock Sacurftfas United - EXTENSION: . Amount: Purpose: £9,000 Purchase o f flat ' i T«m>: Extension far period of one year to 31/1/79 Rate: 12% fixed & 'si* Drawdown: Already fc k ta up by wqy of lo ar Securfty Guarantee of Bunch! Wojnor "SUITABLY w rt »m « Recoran«ndad. 470; . fllH M £S5 g WHOM LIMITED WSHfll* 10 HMOK LOWS BACKED BY DEPOSITS* HELD' » C /W H H /ttElM sgY L o u - J a l m e a O u ts ta n d in g ...... » t 30 *rt1 197S . TBiwy • O tp o s lf gay— n ' 17. .1 CQM>jmnr< 6 u a rn » « y * F o x ro ck S o c u r t t f o * L td . l.« 9 6,002.000 . T1» bank h o ld s a d d i t i o n a l s a c u r l t y 1# r w p w t o f £ .4 4 1 ,6 1 4 j£v*v*v aaay o f th o abov* lo a m . 1 ,3 1 7 ,5 9 4 M .J .P .'to E A . U ra ell «■* * 24th D eC 8raber* r9afi _____________________________ B ra ce : A i re q u este d I lis t hereunder p a rticu la rs o f th e A cco u n t* fo r w h ich w e h old b a ck lo g s./ deposit* f r o m G M C T : a) . ' b) N on R esid e n t A cc o u n ts ■i w h ich a r e .Includ ed in th e fu ll » e e -c o ff c a te g o r y fo r C en tra l B ank R eturn* : - R esid e n t A cco u n ts fo r w hich w e h o ld d ep o sits from GMCT d u ly h y p o th eca ted : * Resident Account for which we hold deposit direct from V which Is a Cayman Company : - 4) Collage Trusted clients for whom Collage have arranged backing deposits here through G.M.C.T. : . J f Fletcher A Philiptan &j.x«4.«0 Stg* With reference to .' • you will also have similar loans and security on your own books for significant amounts. Regards, Michael J. Pender fete- •<*/ •?vy & *£ t Matnarmdum 9ubmlttm/b* PO*D NAME: FLETCHER A PHILLIPSO N M O R B K /iv 17, C lyde Road, BaJIsbrldje, D ublin 4. ■W'ftyStAa. N o. C J. Approvals Yn/No Parmloto* Obtiinad Dam FCB25atmitiad wsnwv OCCUPATION* Wallpaper D tatrib u to rt THIS APPLICATION: N« X* AMOUNT: JStl A U fe flW .. mg.-__ taa.~ KATE: _ -1 2 i» ------------FSB: __N U . (Martin 1%)... FUHPOSKARAWDCMN: . _ hdMla, h drawdown parmlttadpriort« — m Jitlaw ofwaurity? Working capital - pv m M t o f liwoli nportst*m of w ! - » T r . Y B /N O MVISWOATBSl TSUMOFt'AOUTMSt 3 l.0 3 .f9 4 9 ‘ 7' SOUNCS OP REPAYMUfTi Caah flow from business. _If eddWoml e» * * * g SECURITY: ’fadffly,I»■aurttyInoidmrt Yffl/Mi * Caarantee o r Buradil Wojnar. (ConaMarad adequate). BACKonauNDNon/ If Na, #wd«UH«HMMtiV.' ' / ’3UTLBM OC PROPOSAL: Stg. <131,000 advanced November, HUM and renewed August, ISIS - fully repaid, .t* . 1100,000 advanced Antag January, 1887 tally repaid No ou tatending liabilities at present. Immediate requirem ent la 5cgjE20,000 to payment of Invoice* bald Our past experience wlefa the borrower* baa bean excellent. ■ Balance Sheet 91st December 1982 shows: Turnover £3,123,000 Profit after Tax 40,000 Shareholdara Funds 338,000 . facility re c o m m e n d e d Rtiatni PaaMtiat/Bcvrowam (Bahmea or Uralt, which«v«r la gmtar) C M BIT CQMMITTII ■j ____ -------------------» ftMonmandad BOARD Toul Sxpoiur*: £113,000 MlnuM— Data.. ' I I I M. W. VKL^APm SPECIALISTS LIM ITED M inutes o f a M ee ting o f D ire c to rs h e ld a t 1 7 , C lyde Road, D u b lin l», on the 7 th O c to b e r, 1980 a t 3 .0 0 p .m . PRESENT: _ . ‘ Burachi W ojnar ( I n th e C h a ir) » C h risto p h e r Vo,1nar . Bernard Wojnar GUINNESS t MAHOK F A d L I W : I t vaa re ^ Q -re d : . ' • "T h a t a f a c i l i t y in the m m o f £5k,5QQ (Titty Tayr thousand, F iv e Hundred Pounds) - I r i s h £ , be accepted from . ’ G uinness & Mahon L ia ite d on the co n d itio n s set out in * , t h e i r le t t e r o f the 2nd Septem ber, 1980, to the Conpany • and th a t M r. B urschi W ojnar be ynd ia hereby .a u th o rise d to acce pt t h e .f a c ilit y on b e h a lf o f the Company". • •* • •. • GUARANTEE; ' • I t vaa noted th a t S e c u rity f o r th e fo re g o in g f a c i l i t y would be in the fo ra o f personal guarantee com pleted b y M r. B u ra c h i W ojnar. SIGNED: DATED: % Our Refs PO'D/SM .. 2nd September, 1980. The Secretary, M. W . Wallpaper Specialists Limited, c/o,. Business Enterprises Limited, 17, Clyde Road, • Ballsbridge, ” ‘ DUBLIN 4. ) Bear Sir, • . Further to r e c e n t d isc u ssio n s, we con fi rm th a t we ara . prepared to e x te . i your loan f a c ilit y su b ject to th e fo llo w in g ■►erm® »*** r«onditd ons:— . . Borrower: M. W. Wallpaper Specialists Limited. Amount: .£54,500.00 (Fifty Four Thousand, Five Hundred Pounds) - Irish £. . Purpose: She funds are being made available to you in the , form of working capital. ' * • t Term: ' In accordance with normal banking practice all sums taken up are repayable on demand but in any case not later than 30th September, 1981. ‘ ’ Drawdown: She funds have already been taken up in the form of a Loan Account in your name. Repayment: You undertake to effect monthly reductions of £1,500.00. .• h In te r n st: . • .We propose charging interest on the loan at 3% in excess of Guinness + Mahon Limited's Base Rate fluctuating therewith. The present effective rate 'is therefore 23% per-annum and we shall advise you of any change in our Base Rata. Interest will be' debited to your Loan Account on tha usual quarterly dates. /. Security: As security, for the loan we shall retain a • Guarantee completed by Burschi Wojnar, supported by a deposit of 34,100 shares in Fletcher & Phillipson Limited. . L iq u id ity Clause: ' If there shall be any increase in the cost to us of making or maintaining tha loan by an amount which we deem material resulting from any changes in the reserve or liquidity requirements to which we may ■ he subjected# than we shall he entitled to call for payment: of additional interest: of such amount as we shall certify as the amount required to compensate for such increased' cost with effect from the date of notification. •You shall Jbe at liberty within one month after such notification and without .payment of any premium or penalty to repay the full amount of* the facility outstanding together with interest at the rate applying prior to ' notification. • ' na tu.6 j^alouased tu continue uLu-tii facility available u> you and enclose herewith a copy of this facility letter f<2nr signature by your authorised signatories and return thereby confirming your . acceptance of the loan on the terms mentioned. .• We shall also require a Board Resolution authorising the borrowing. . - Yours faithfully, * for GUINNESS + MAHON LIMITED P. O'Dwyer, Banking Manager. T. R. Leonard, Banking Manager. Amman (138x155)- To: K*«« Sinead O'Brien. F ro m : P. O 'D w y e r . . . W o u ld y o a p le a s e t r a n s f e r a a u a o f £ 9 6 f OOO o a t o f ” 2 '* S p e c i a l a n d p l a c e t h e fu n d s on a s e p a r a t e a c c o u n t a t G u in n e s s + M ahon Base B a te . We a r e c h a r g in g l n t e r e a t o n t h e l o a n a t B a s e B a t e + 3 % P l e a a e v a l u e d a t e th e e n t r y 1 8 t h J ttn e , 1 9 7 9 . A bove In s tr u c tio n s P O ’ D /S lf r e c e iv e d fr o m J o e S e e l y by phone. JOHN J.STAKELUM "Fairmont" Ballyronan Road Kilpedder, Co. Wicklow. 30 July2001. i j&C: The High Court Inspectors, 3"1Floor, TridentHouse, Blackrock, Co. Dublin. Dear Inspectors, Ireferto Schedule Ienclosed with my lettertoyou dated21 February2001. In recent days, r.•>ugh Orpen Franks and Company, I became aware of information that InHiratm to me the nam* of another cl’<>nf "VwW included in Schedule 1 as follows: . Name: Mr. Burschi Wojnar -deceasedMay 1993. Offehore Deposits: Yes. Back to Back Loan: Yes. Date Deposit Opened. Circa 1978. Date Deposit Closed. Circa 1987. Source ofFunds Offshore. Unknown but probablyoffehore. Yours faithfully, JOHN J. STAKELUM “Fairmont” BaUyronan Road, Kilpedder, Co. Wicklow. 21 February 2001. The High Court Inspectors, 3rdFloor, . TridentHouse, Blackrock, Co. Dublin. Re: Interviewswith tbe Inspectors on 8/11/2000 and 6/12/2000. Dear Inspectors, 5. The information requested by Ms. Mackey on the 6 December 2000. The information requested by Ms. Mackey on 6 December’2000 isgiven in the three schedules thatareappended tothisletter. Schedule 1relatestothe listofnames Isenttothe Inspectorson 6 November 2000. All on this schedulebad offshoredepositsinG & M throughrayprocedure. Yours sincerely, Appendix XV (139) Mr Richard Wood 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Richard Wood. a) Transcript of evidence of M r Richard W o o d dated 21 March 2000. b) Letter of 16 March 2000 - M r Richard W o o d to the Inspectors. c) Letter and statement of affairs of 16 March 1977 - G M C T to M r Richard Wood. d) Letter of 28 January 1976 - G M C T to Guinness and Mahon. Correspondence received from M r Richard Wood. a) Letter of 3 December 2001 - M r Richard W o o d to Inspectors. UNDER OATH ON TUESDAY, 21ST MARCH 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. JUSTICE COSTELLO MR. ROWAN FCA MS . MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. RICHARD WOOD WITNESS MR. R. WOOD EXAMINATION MR. JUSTICE COSTELLO PAGE 5 - 59 MR. ROWAN 60 - 62 MS. MACKEY 63 - 69 MR. JUSTICE COSTELLO 70 - 73 1 2 3 4 MR. WOOD: I take it all the files arrived, did they? 5 6 MS. CUMMINS: They did. 7 MR. JUSTICE COSTELLO: They did. name is Declan Costello 8 9 Mr. Wood, my and on my right is Ms. Mackey and on my left 10 is Mr. Rowan. We are the Inspectors. 11 MR. WOOD: Yes. 12 MR. JUSTICE COSTELLO: Who have been appointed, you know, by The High 13 14 Court. 15 MR. WOOD: Yes. 16 MR. JUSTICE COSTELLO: This interview is one that 17 is under oath and I will 18 ask now our solicitor, Ms. Cummins, to administer 19 the oath to you. 20 21 22 23 24 25 26 27 28 29 1 2 3 4 1 Q. MR. JUSTICE COSTELLO: 5 Mr. Wood, we received your statement and the files 6 but unfortunately we did not get them — 7 solicitor managed to obtain them on Saturday morning 8 -- until yesterday morning? 9 A. 10 2 Q. 11 A. 12 3 Q. 13 our Yes. We have not had an opportunity to peruse them? Yes. Unfortunately it may be necessary to ask you to come back when we have done that? 14 A. 15 4 Q. Yes, I can imagine, yes. However, we will try to make as much progress as we 16 can today in the absence of our knowledge of what is 17 in the documents and so I am going to have to ask 18 you for a great deal more information than you have 19 given in your written statement? 20 A. 21 5 Q. Yes. I would be glad if you would be as detailed as you 22 can in relation to matters with which we are 23 concerned? 24 A. 25 6 Q. Yes. I think the best way to carry out our task this 26 morning is if we go through your statement of 27 the 16th March (Exhibit 1). 28 A. 29 7 Q. Have you got that? Yes. Have you got a copy of it there? 1 2 8 Q. 3 A. 4 9 Q. Yes? Yes, I have (Same Handed). Yes, thanks. Mr. Wood, at the beginning of it you refer to the 5 company there, of which your father apparently was 6 the owner of the shares, is that right? 7 A. 8 10 Q. 9 Sorry now, which company do you mean? What company are you referring to there in the second paragraph? 10 A. 11 11 Q. The second paragraph? Beginning with your father's death. "He and three 12 friends," were directors of my father's company, 13 what company is that? 14 A. That is a company called John A. Wood Limited in Cork. 15 16 12 Q. 17 A. Yes. 18 13 Q. Yes? 19 A. 20 14 Q. John A. Wood Limited? It is now part of CRH. Yes. You refer then to the relationship between 21 your father and these other gentlemen, that you have 22 referred to? 23 A. 24 15 Q. 25 A. 26 That was in John A. Wood Limited? Well, sorry, only Mr. O'Connor was connected with John A. Wood Limited. 27 16 Q. 28 A. 29 That is right. Yes? Mr. Malachy Walsh was a friend. He was 1 2 17 Q I am just wondering what the relevance of this is to 3 our inquiry, what in John A. Wood Limited is of 4 relevance to our inquiry? 5 A The only relevance is to pinpoint the relationship between my father and Mr. O'Connor. 6 7 18 Q 8 A 9 Mr. O'Connor, I see? And subsequently the relationship between myself and Mr. O'Connor. 10 19 Q 11 A 12 20 Q I see, yes. Very well? Yes . You say that Mr. Maurice O'Kelly was a colleague of 13 Mr. O'Connor's in Guinness & Mahon and it was in a 14 managerial capacity. 15 acting as a managerial capacity in this company, 16 John A. Wood Limited? 17 A No, no, sorry, no. Does that mean that he was He was asked to act in a 18 managerial capacity for the development companies 19 which were being operated by these individuals. 20 21 Q What was your involvement, your own personal involvement, in this company? 21 22 A 23 22 Q 24 A 25 23 Q 26 A At the time or before my father's death? Yes ? Or subsequently? Yes, before? Before, very slight. I merely sat in on meetings 27 and would have -- might have had -- would have sat 28 in on informal discussions with 29 the s e . ..(INTERJECTION). 1 24 Q 2 A 3 25 Q 4 A 5 26 Q What was your occupation then and since Mr. Wood? 6 A I was an employee of John A. Wood Limited at that 7 Were you on the board of Directors of the company? No. time . 8 27 Q 9 A 10 28 Q 11 A 12 29 Q 13 A 14 30 Q An employee? Yes . What was your employment? I ...(INTERJECTION). What were you? I was an assistant to my father. Yes, but what was your title? What was your -- just an assistant to your father? 15 16 A 17 31 Q 18 A 19 32 Q 20 A 21 33 Q 22 A 23 34 Q 24 A 25 35 Q 26 A 27 36 Q 28 A 29 No. I am not quite sure...(INTERJECTION). On the managerial side? Yes, I am not sure that I had a title. Yes? E m . . . (INTERJECTION). You were an assistant? Yes . To your father? Yes, yes. You were carrying on the business with your father? Of John A. Wood Limited. Of John A. Wood Limited, yes? Well, I wouldn't go so far as to say I was carrying it on because I was relatively new to the company 1 and there were far more experienced and competent 2 people there to do that. 3 37 Q. 4 A. 5 38 Q. 6 A. 7 39 Q. 8 A. 9 40 Q. 10 A. 11 41 Q. 12 A. 13 42 Q. 14 A. 15 43 Q. What was the business the company was carrying on? It is a stone business. Yes? It extracts sand, gravel and rock. Yes? And makes concrete products. Yes. This became your full-time employment, did it? It became my main employment. Yes? But we also have a farm at home. Yes? Which I look after. Yes. Will you come to the answers to the questions? 16 Before I come to that Mr. Wood can I refer you to 17 the letter to which yours is a reply? 18 20th January letter. 19 2 )? 20 A. 21 44 Q. 22 A. 23 45 Q. 25 A. 26 4 6 Q. 28 29 It is the long letter (Exhibit Yes. That we have written to you? Can I have a copy of that (Same Handed). (Exhibit 2) Thank you. 24 27 It is the Can I refer you to Appendix C of that long letter? Yes. Do you see at the very beginning of this Appendix C: "You should provide a full and detailed statement of all the dealings with which the company had with you either directly of indirectly." 1 2 47 Q. 3 A. 4 48 Q. 5 A. 6 4 9 Q. 7 A. 8 50 Q. 9 A. 10 51 Q. Is that what you are doing in this statement? That is what I am attempting to do. Yes? Now, the company there b e i n g . . . (INTERJECTION). "Ansbacher"? "Ansbacher", yes. Which we call "Ansbacher"? Yes. Which was then known as Guinness Mahon Cayman Limited? 11 12 A. 13 52 Q. Yes? 14 A. Yes. 15 53 Q. 16 That is right, yes. You are attempting to tell us the dealings you had with what we now call "Ansbacher"? 17 A. 18 54 Q. That is right, yes, yes. Would you go over the page to the paragraph that is 19 headed "Cayman Islands Trust and Trust Companies", 20 paragraph number 1? 21 A. 22 55 Q. 23 24 25 Yes. "If you cause to be executed a Deed Of Trust or other instrument in the Cayman Islands or elsewhere whereby the company or some other person associated with. ..READING INTO THE WORDS ... trustee or manage the trust for y o u . .." 26 27 28 29 Did you cause a Deed Of Trust to be established? A. I certainly didn't. Whether it is was done or not I can't really tell you. As I said my involvement 1 with the establishment of these companies was fairly 2 minimal because they were established, I think all 3 of them were established, before my father's death. 4 5 A. 6 57 Q. 7 A. Possibly not "Thrush". Yes? But of the three which have their base in the Cayman 8 I don't think I was involved in the creation of 9 those. 10 58 Q. 11 A. 12 59 Q. 13 14 Yes? I don't think I was. Did you make enquiries about this matter? After you got this letter did you make enquiries? A. I wrote -- well, I have written to Guinness & Mahon 15 for information about these and I haven't yet 16 received a full reply. 17 acknowledgment from them. 18 60 Q. 19 A. I merely got an When did you write to them? Now, my letter to them was somewhat delayed because 20 of the confusion between myself and my auditor about 21 the preparation of this letter. 22 letter I passed it on to my auditor. 23 61 Q. 24 A. 25 62 Q. 26 A. 27 63 Q. 28 A. 29 When I got your Who is that? That is Deloitte & Touche in Cork. Yes? And the preparation of a letter was put in train. Yes? It was only fairly recently I discovered that they were preparing a letter for The Inspector Of Taxes 1 2 64 Q. 3 A. 4 65 Q. 6 A. 7 66 Q. 8 A. 9 67 Q. 10 A. 11 68 Q. 12 A. 13 69 Q. 14 A. 15 70 Q. 16 A. Yes? For you. Have you sent a letter? I beg your pardon? Have you sent the letter? Sent the letter? Have you sent a letter to Guinness & Mahon? Yes. When was that? On the 7th March. Can you let us have a copy of that letter? Yes, certainly. 71 Q . Yes ? 18 A. 19 72 Q. 20 A. 21 73 Q. 22 A. 23 74 Q. 24 A. 25 75 Q. 26 Do you want it now? Not now? Yes. We will have to get it later? Yes. Do you want me to read it out? No, I do not? Okay. Yes. Were you aware whether or not Mr. Don Reid was involved in the establishment of these companies? 27 A. 28 7 6 Q. 29 And so I had to get the files back from them and then prepare the letter myself. 5 17 Yes? No, I wasn't, no. Were you aware that Stokes Kennedy Crowley were involved in any way? 1 No, no. 2 the establishment of those companies. 3 77 Q 4 Yes. I can tell you, I am afraid, nothing about However, about the trusts that were established? 5 A 6 78 Q 7 A I know nothing about the trusts. Do you know was there any trust ever established? All I know is that the proceeds of these companies 8 were handled by Hexagon Securities and Whitethorne 9 No. 7 Trust. 10 79 Q 11 A 12 80 Q 13 A Yes ? In the Cayman. Yes ? Now, what lies behind those companies or how they 14 are set up or how they were set up or by whom, I 15 have no notion. 16 81 Q 17 Who received the funds from the company, from the profits that were made by these trusts? 18 A 19 82 Q 20 A 21 83 Q E m . . . (INTERJECTION). Did you? The profits made by these trusts? No, no, the profits that were distributed by the trusts ? 22 23 A 24 84 Q 25 A By the trust in the Cayman that returned to Ireland. Yes ? Or the profits made in Ireland that went to the Cay m a n . 26 27 85 Q Both? 28 A Both. 29 86 Q Yes? 1 The profits made in Ireland that went to the Cayman 2 were apparently handled by Hexagon Securities and 3 Whitethorne No. 7 Trust. 4 87 Q 5 A 6 88 Q 7 A Now, that money eventually returned to Ireland. Yes, I know. Who were the beneficiaries? And the beneficiaries were Thrush Securities and Youghal Development Company. 8 9 Yes ? 89 Q What about yourself? Did you get any money from them? 10 11 A 12 90 Q 13 A 14 91 Q 15 No, I got nothing from them. Nothing at all? Nothing personally, no. No, not personally but your company, any company that you were interested in? 16 A 17 92 Q 18 A 19 93 Q 20 A 21 94 Q Those two companies got the proceeds. Were you interested in those companies? Yes, at that stage I was a shareholder in those. Yes? I mean I w a s . ..(INTERJECTION). I think you know Mr. Wood exactly what I am trying 22 to find out. I am trying to find out, we are trying 23 to find out, whether you got any beneficial interest 24 from these elaborate arrangements, and did you? 25 The money came back to these companies. 26 Development Company made no money at all and that 27 was merely -- I think it merely made up Youghal 28 Development losses. 29 money that came to "Youghal". Youghal That is what happened with the The money that came 1 to Thrush Securities enabled "Thrush" to continue 2 and "Thrush" eventually did make a profit. 3 95 Q. 4 A. 5 96 Q. 6 A. What was your interest in Thrush? I was 70% shareholder. You got 70% of whatever came? Well, in fact, I didn't because of my involvement 7 with Bula Limited. 8 mortgage was put on Portobello House, that is the 9 property that "Thrush" was developing and the What happened was that a second surplus was taken by the bank. 10 11 97 Q. 12 A. Yes? In satisfaction of that second mortgage when 13 "Thrush" was -- when the Portobello was sold and 14 "Thrush" was wound up. 15 98 Q. 16 A. 17 99 Q. Yes? So, that is what happened to the cash in the end. The cash came to a company in which you were a 70% shareholder? 18 19 A. 20 100 Q. Yes, that is right. And eventually then because of various financial 21 problems that arose you were not able to avail of 22 the cash? 23 A. 24 101 Q. 25 A. 26 102 Q. 27 28 29 That is right, yes. Very well? Yes, yes. Now we will go into it in more detail. turn over the page: "Apart from my personal advisers, we used the services of Management and Investment Services Ltd., to do secretarial work for some of the Would you 1 2 3 Is that Mr. Field-Corbett? 4 Yes . 5 103 Q 6 A 7 104 Q That is right, yes. Yes. What do you mean by "...we used the services of Management and Investment Services Ltd." 8 9 What does that mean? 10 11 A 12 105 Q 13 A 14 We, being the group that were involved. Yes ? Initially my father, Mr. O'Connor and Mr. Malachy Walsh and Mr. Fred Thompson. 15 106 Q 16 A 17 107 Q 18 A Yes? And subsequently I was substituted for my father. In what? In this group that ran these companies. That created...(INTERJECTION). 19 20 His company? 108 Q No, tell me what they were? in this group? 21 22 A 23 109 Q 24 A How were you involved What group are we talking about? The group of people a r e ...(INTERJECTION)? No, no, we are talking about companies now? The companies, yes. Well, the companies are listed 25 on the last page of -- sorry, they are listed at 26 number 8, on the third page of my letter. 27 110 Q 28 A 29 111 Q Youghal Development? That is right. All ri g h t . Did you become a shareholder in Youghal 16 1 2 3 112 Q 4 A 5 What shares did you hold in the company? I think the way these companies were set up was that my father was the primary, the sole, shareholder. 6 113 Q 7 A Yes? With an understanding that if profits arose they would be distributed. 8 9 114 Q 10 A 11 115 Q 12 A 13 116 Q 14 A 15 117 Q 16 A 17 118 Q 18 A 19 119 Q W e l l . . . (INTERJECTION)? In the proportions that I have mentioned. I am just concerned about the shares? Yes . He was the full shareholder? Yes . Of all the shares issued? Yes . Did you inherit these from him? Yes, yes. You became the full shareholder. The owner of all the shares? 20 21 A 22 120 Q 23 A 24 121 Q 25 A 26 122 Q 27 That is right, yes. I am sorry? I stood in his shoes at the time of his death. Sorry? I stood in his shoes. He made a will, did he? it to you? 28 A 29 123 Q I stood in his shoes. Yes . A will? Did he make a will and give 1 2 124 Q. 3 A. What happened Copenhagen Investment Co. Ltd.? Well, that one I am afraid I had completely 4 forgotten about and I can only find those two 5 references which I mentioned in my letter there 6 just below. 7 125 Q. 8 A. 9 When was it incorporated? It would have been I think in 1974. So, that was after my father's death. 10 12 6 Q. 11 A. 12 127 Q. 13 A. 14 128 Q. 15 A. Just a moment now? Yes, sorry. Just take it slowly? Yes. Were you a shareholder in Copenhagen Investments? Well, on the basis of the information to hand I can 16 only presume that I was. 17 have, you know, a share certificate or anything like 18 that but the company was established in the same way 19 as the previous ones had been. 20 129 Q. 21 A. 22 130 Q. 23 A. When I say that I don't No, but your father was dead now? Yes, he was dead. That is right, yes. What was the investment in Boreenmanna Road? I can't remember what it was. I think it was a very 24 small development on Boreenmanna Road. 25 possibly connected or on the site of 26 Mr. Malachy Walsh's offices, which were there. 27 131 Q. Yes? 28 A. Yes. 29 132 Q. Was this a development of the property? I think 1 2 133 Q 3 A 4 134 Q 5 A That is right, yes, yes. Who was your solicitor in those days? My personal solicitor was Mr. Jack Nagle and still is . 6 7 135 Q 8 A 9 136 Q Mr. Nagle? Yes . Was Mr. Nagle acting in the establishment of Copenhagen Investments? 10 11 A 12 137 Q 13 A 14 138 Q 15 I can't recall I must say. I don't know. Who else could have been? I don't know who else it might have been. Why have you put these companies here? Why are we concerned today with Copenhagen Investments? 16 A 17 139 Q 18 A Because it has a Cayman connection. That is what I want you to tell me about? I put that in because the other note in the file, 19 which I have come across, indicates that Copenhagen 20 made a surplus and that the surplus was transferred 21 to the Cayman. 22 140 Q 23 a bit more specific Mr. Wood? 24 A 25 141 Q 26 A 27 142 Q 28 A 29 However, tell me -- you keep saying "The Cayman" be Well, it was transferred. To who? To. . . (INTERJECTION) . To what body? Well, either to Hexagon or to the Whitethorne No. 7 Trust, sorry. 1 143 Q We will come to that later. However, your 2 information to us is that the profits made by 3 Copenhagen went to Hexagon or to Whitethorne? 4 A 5 144 Q 6 A 7 145 Q 8 A 9 10 Or to Whitethorne, yes. Do you know which? No, I have no idea. Yes. Why have you no idea? Well, I am unaware of how this was handled in the Cayman. 146 Q No, we can go into that later. When you say you are 11 unaware how it was handled in the Cayman, where did 12 it go to from Copenhagen? 13 A 14 147 Q 15 A 17 148 Q 18 A 19 149 Q A 150 Q 29 Why Guinness & Mahon? What interest had they got in I presume that they were bankers No, no. Why do you presume? Do you not know? This was a development that you were involved in? A 27 28 Hopefully Guinness & Mahon may be able to help t o . . . (INTERJECTION). 25 26 Could you find out? Copenhagen Investment Company? 23 24 I am afraid I don't. there. 21 22 However, when you say that, do you not know what entity it went to? 16 20 All I know is that it went to the Cayman. Yes, yes, I am afraid it -- I mean I have forgotten most of the details connected with this. 151 Q However, this is very important because we have to ascertain exactly what happened in relation to the 1 companies that were established and transferred 2 funds to the Cayman and transferred to trusts, which 3 we will come to in a moment? 4 Yes . 5 152 Q How could you find out for us? auditors and accountants? 6 7 A Of Copenhagen? 8 153 Q Of Copenhagen? 9 A 10 154 Q 11 A There again I am afraid I don't know. And your solicitor was Mr. Nagle? Yes, I am not -- I can't be sure that he was involved though. 12 13 Who were the 155 Q You have looked, you have seen, some documents quite 14 recently apparently of a transfer of funds, have 15 you? 16 A 17 I mentioned here in this paragraph. 18 156 Q 19 A 20 157 Q 21 A 22 158 Q 23 A 24 159 Q 25 A 26 160 Q 27 A 28 161 Q 29 No, the only documents I have seen are the ones that How do you know there was a transfer of funds? Because the document says so. What sum was involved? £7,500. £7,500, yes? Yes . Have we got a copy of that document? Yes, yes, you have. There is note, hand written, dated 28th October? Yes, and it is flagged in the file. Yes, very well. Doing the best you can, who do you think the money would have gone to? Either to Hexagon or to Whitethorne No. 7 Trust. 1 2 162 Q 3 A 4 Directly to them? Now, I doubt if it went directly to them b ecause.. . (INTERJECTION). 5 163 Q 6 A Why do you doubt that? Well, because I don't think I ever sent directly. 7 think if it went it went through -- its route would 8 have been presumably through Guinness & Mahon. 9 164 Q 10 A Guinness & Mahon was the entity that organised the arrangements in the Cayman. 11 12 165 Q 13 A 14 15 Now explain that to me? W e l l . . . (INTERJECTION)? And I had no direct dealings with the Cayman apart from a few letters. 166 Q 16 Be a bit more specific. Guinness & Mahon was the entity? 17 A 18 167 Q 19 A 20 168 Q 21 A 22 169 Q 23 A 24 170 Q Yes . What do you mean by that? Well, it was a body that made these arrangements. That is what I want to understand? Yes . Th e y . . . (INTERJECTION)? A n d . . . (INTERJECTION). Guinness & Mahon made the financial arrangements by 25 which money was transferred by Copenhagen to the 26 Cayman Islands? 27 A 28 171 Q 29 A That is right, yes. Who were you dealing with in Guinness & Mahon? Primarily with Mr. O'Connor. I 1 172 Q 2 A 3 4 remember. 173 Q 5 A 7 174 Q 8 A 9 175 Q A Yes? I presume I did. I really can't recollect this at You recollect that it was Guinness & Mahon that was Yes, I do, yes, yes. I mean that was the only route. 176 Q 15 16 I presume I did. involved? 13 14 You must have all. 11 12 Did you discuss it with Mr. O'Connor? discussed it with him? 6 10 Now, what is his involvement in this I simply can't If Guinness & Mahon were bankers were they lending you, lending Copenhagen Investment, money? A 17 Again I can't recollect what the financial arrangements were for Copenhagen. 18 177 Q 19 A What do you think? It may not have because it was -- I don't know but 20 they may not have because it was a relatively small 21 matter. 22 178 Q 23 A 24 179 Q 25 A 26 A small development. Yes ? It is quite possible that that was done through personal funds or something like that. 27 180 Q 28 A 29 Yes? I see? But if banking was required, and I suppose it is more likely that banking was required, then I assume 1 that any money that was arranged, raised, was 2 arranged through Guinness & Mahon. 3 181 Q 4 A 5 182 Q Is that a bigger development then? 6 A It was certainly much much longer. 7 Let us take Youghal Developments then? Yes . Yes, it was bigger, yes. When was it established? 8 183 Q 9 A 10 184 Q Yes ? 11 A Yes . 12 185 Q 13 A 14 186 Q I think that must have been in the late 1960's. You then became the owner of the shares? That is right, yes. Yes. Just give me some idea of the extent of the 15 development? 16 it in millions? 17 A 18 187 Q 19 A 20 188 Q 21 A 22 189 Q 23 A 24 Was it in hundreds of thousands? What was it? It i s . ..(INTERJECTION). In Youghal? In Youghal. Yes? It certainly wasn't millions. Yes? There is no question of that. of thousands. 25 190 Q 26 A 27 191 Q 28 A 29 192 Q Was Yes ? It may have reached £100,000. Yes, what was it? Again I am afraid. What was it? It was more like tens 1 2 193 Q 3 A What it was? It was a harbour property or series of properties 4 which were being assembled with a view to building a 5 hotel there and it came to nothing because the 6 market in Youghal never materialised really, the 7 tourism market there never materialise, and also I 8 think there was a certain amount of difficulty with 9 title to some of the property. 10 194 Q 11 A What happened? The lots, the various lots, were sold without development. 12 13 195 Q 14 A 15 196 Q Was Guinness & Mahon your bankers? 16 A I can only presume that they were. 17 197 Q 18 Yes? After a number of years. They were -- they had -- this had a connection with Cayman Islands, Youghal development? 19 A Yes . 20 198 Q Yes? 21 A Yes . 22 199 Q 23 A 24 200 Q 25 Yes . Do you know whether the company had borrowed funds from Guinness & Mahon? 26 A 27 201 Q 28 A 29 You presume they were? I can't say definitely. Yes? There again I imagine if funds had to be raised they would have been raised with Guinness & Mahon. 1 202 Q. 2 A. 3 Yes? And hopefully this will become clearer when we get documentation from Guinness & Mahon. 4 203 Q. 5 A. 6 204 Q. 7 Have you written to them for this? Yes, I have. Can you recollect what security was given to Guinness & Mahon? 8 A. 9 205 Q. 10 A. For Youghal? Yes? Again I have to presume that the property itself formed part of the security. 11 12 206 Q. 13 A. 14 207 Q. 15 A. 16 208 Q. This is a presumption now? It is. Just can you remember? No, I can't remember clearly I am afraid. Did you know that the company that they had 17 established as part of this arrangement was in fact 18 entitled, or you were entitled as a beneficiary of 19 the company, to draw funds on the deposit in 20 Guinness & Mahon? 21 A. 22 209 Q. 23 A. 24 210 Q. 26 A. 27 29 You did not know at the time? I must say that I have come across in the file a reference to backing which I don't understand. 25 28 I have only heard that in the press. Yes? And I think it is on the second page of my letter. Yes, it is at paragraph two at the bottom. 211 Q. Do you understand now what it is? 1 2 212 Q 3 It is the concept of backing? 4 A 5 213 Q 6 A 7 214 Q 8 A 9 215 Q 10 A The concept of backing I understand that now, yes. Surely you knew that? No, I d i d n 't . As a businessman, you did not know that? No, I didn't k no w ...(INTERJECTION). W e l l . . . (INTERJECTION)? I didn't know that that facility was available and if I . . . (INTERJECTION). 11 12 No, no, it is not the note. 216 Q You did not know that the facility was available by 13 which a deposit that was held in Guinness & Mahon 14 could be used for a loan? 15 A 16 217 Q 17 A 18 218 Q 19 A 20 219 Q That is right. Yes ? The deposit held in the Cayman, is that not so. W e l l . . . (INTERJECTION)? Is that the way it worked. I will come to your knowledge of it in greater 21 detail in a moment, Mr. Wood. 22 here. 23 this arrangement that Guinness & Mahon had 24 established. Copenhagen Investments was part of the 25 arrangement. What about Sandpiper Holdings? 26 A We will just continue Youghal Development Co. Ltd., was part of That was likewise. 27 Just tell me about "Sandpiper"? 28 established? 29 It was before my father's death. 27 When was it I don't know what 1 2 221 Q 3 A 4 222 Q 5 A 6 223 Q 7 A 8 224 Q 9 A 10 225 Q Where was it registered? Sorry? Where was the company registered? I don't know. Did you become entitled to the shares on his death? Yes . All of them? Yes . You see Mr. Wood we have obtained information 11 elsewhere that Mr. Crampton apparently was involved 12 in a company called Sandpiper Holdings? 13 A Yes, there was a link there between Mr. O'Connor and 14 the Crampton Company because when Mr. O'Connor left 15 John A. Wood Limited in Cork, he was involved in the 16 building trade, in fact before he came to us and in 17 fact many years ago he was a builder himself. 18 226 Q 19 A Yes ? Then he came to us and then when he left us he 20 joined Cramptons in Dublin and after he left -- then 21 he went from Cramptons to Guinness & Mahon and some 22 of these companies had involvements with -- sorry, 23 the Cramptons were involved in some of these 24 companies. 25 mean I was 100% shareholder of the shares that were 26 in our group. 27 Mr. Walsh and Mr. Thompson. 28 Was Mr. Crampton a shareholder in Sandpiper 29 Holdings ? When I say I was a 100% shareholder I The group being Mr. O'Connor, 1 A. Now, he was a shareholder in some of these companies. 2 3 228 Q. 4 A. 5 229 Q. 6 A. 7 Which one? One or two of them. Which one? I am afraid I would have to refer to the files to see. 8 230 Q. 9 A. Is it not very likely that it is Sandpiper? It could well have been. It could well have been. 10 The most likely ones are Sandpiper -- I think not 11 Copenhagen. 12 a n d . . . (INTERJECTION). 13 231 Q. 14 A. 15 232 Q. 16 A. 17 233 Q. 18 A. Why are you not sure about Youghal? E m . . . (INTERJECTION). You told us that you had 100% of the shares? Yes, yes, I had 100% in Youghal, yes. I mean have you a doubt about it? No, sorry you just raised a doubt in my mind w i t h . . . (INTERJECTION). 19 20 I am not sure about Youghal 234 Q. How could there be any doubt in your mind if your 21 father owned 100% of the shares in Youghal and you 22 received them on your father's death? 23 there be any doubt in your mind that Mr. Crampton 24 had any interest in Youghal? 25 A. I think that Youghal one is too early. 26 established too early. 27 Mr. O'Connor ... (INTERJECTION) . 28 29 235 Q. How could It was This was established before I am just asking you a question. How could you have 1 2 I am hesitating because Mr. Crampton had -- or the 3 Crampton people had an interest in some of these 4 companies and it is not clear in my mind which ones 5 they are. 6 236 Q 7 A 8 237 Q 9 A 10 238 Q 11 A 12 239 Q 13 A 14 240 Q 15 A 16 241 Q 17 A 18 242 Q 19 A 243 Q A 24 25 Let me help you? I don't want to be too specific. Mr. Wood? Yes . Let me help you? Yes . You father had 100% of the shares in Youghal? Well, I think that is true. I think that is true. Because you got 100% of the shares? I certainly got whatever he had. No, no, you told us 100%? Yes, I just hope I am not wrong now because you have How can you find this out for us because it is important ? 22 23 So, I don't. raised that doubt about the Cramptons in my mind. 20 21 W e l l . . . (INTERJECTION)? I can -- again looking through the files...(INTERJECTION). 244 Q No, no, you have files -- can you make enquiries 26 through your solicitors, through an accountant, 27 through The Companies Office? 28 Those enquiries can be made through The Companies 29 Office possibly, certainly. 1 245 Q. 2 A. 3 246 Q. 4 A. 5 247 Q. 6 A. 7 248 Q. Yes, of course, I will. Yes? Yes, if you wish. Then let us move on? Yes. Sandpiper Holdings, you think Mr. Crampton may have had an interest in that? 8 9 A. 10 249 Q. He may have had an interest in that, yes. What interest do you think Mr. Crampton had in these companies ? 11 12 Will you? A. Well, I wish I could refer to the files because I 13 think it does give an indication in the files of his 14 interest in some of them. 15 250 Q. 16 A. 17 We can get the files if you want, if that will help? Well, it might take a bit of a search but certainly I w i l l . ..(INTERJECTION). 18 251 Q. 19 A. 20 252 Q. 21 A. Yes. 22 253 Q. Yes. 23 I will do as you wish. No, we can find out later? Let us move on. Thrush Securities Ltd., when was it established? 24 A. 25 254 Q. 26 A. 27 255 Q. 28 A. 29 That is all right? Sorry? When was it established, Mr. Wood? I think the mid 1970's. Mid 1970's? Sorry, earlier, I beg your pardon. No, the first note -- yes, I imagine the mid 1970s. 1 256 Q. 2 A. Yes? And I think that that was a -- I think the company, 3 in fact, was in existence. 4 company that we took over but our involvement dates 5 from the mid 1970s. 6 257 Q. You s a y . ..(INTERJECTION)? 7 A. As far as I can recollect. 8 258 Q. 9 A. 10 259 Q. I think that is a You say, "when we took over", who do you mean? I mean the same group. No, no, I am just concerned about your interest in 11 it and what interest you had in Thrush Securities 12 yourself personally? 13 A. 14 260 Q. 70%? 15 A. Yes. 16 261 Q. 17 A. 18 262 Q. 20 A. 21 263 Q. 22 A. 23 264 Q. 24 28 29 I don't think the Cramptons are involved in that Where was that established? I beg your pardon. Where was it established, incorporated? In Ireland as far as I know. Yes. Was this part of the arrangements that Guinness & Mahon had made or was it separate? A. 26 27 N o w . . . (INTERJECTION)? one . 19 25 Mine was a 70% interest in Thrush. No, this is separate. They were bankers to it but it had no Cayman involvement. 265 Q. That is why I am just wondering, why you have put it here? 1 266 Q. 2 A. Why are we concerned about it at all? Because there is a note in my handwriting again 3 flagged in the files, which seems to indicate that 4 £22,035 came from abroad in 1975 via DT, presumably 5 Des Traynor. 6 267 Q. 7 A. 8 268 Q. 9 A. Yes? You see the last few lines on that page? Yes. What does that mean to you? It appears that -- well, Thrush was quite a large 10 investment for us, and it did have difficulties and 11 it required cash injections from time to time, and 12 it appears that some of the money that had gone 13 abroad came back to assist Thrush. 14 269 Q. 15 gone abroad? 16 A. 17 27 0 Q. 18 A. 19 271 Q. Yes. What money went abroad? Money went abroad from Sandpiper and from Youghal. When you say "went abroad" it went to a trust company in the Cayman? 20 21 A. 22 272 Q. 23 A. 24 273 Q. 25 26 You see it appears that some of the money that had Yes, that is right. That is what I mean, yes. It went to a trust company? That is what I am talking about, yes. The trust company in Cayman then transferred funds to Thrush, is that right? A. Yes, that is what it appears to say but as I also 27 say I can't find a mention of that sum in the 28 statement which I have from the Cayman. 29 1 used monies that was in the trust to invest 2 in Thrush? 3 That is right. 4 275 Q 5 A 6 276 Q 7 A 8 277 Q 9 A 10 278 Q Yes, it appears that is the way it was done. This was done through Mr. Traynor? That appears to be the case, yes. Yes? According to my handwritten note. Yes. When you say the trust companies are you talking about Hexagon? 11 12 A 13 279 Q 14 A 15 280 Q 16 A 17 281 Q 18 A Yes, and Whitethorne. A n d / o r . ..(INTERJECTION)? And/or Whitethorne No. 7. One or other? Yes . You do not know which? I don't know. I don't understand the arrangement between them. 19 20 Yes ? 282 Q Yes. Thrush Securities Ltd., was a company that was registered, incorporated, in Ireland? 21 22 A 23 283 Q 24 A 25 284 Q 26 Yes . You owned 70% of the shares? That is right. How big of a development was Portobello house? it again in hundreds of thousands? 27 A 28 285 Q 29 A Hundreds of thousands, yes. In millions o r . ..(INTERJECTION)? Was 1 286 Q 2 A 3 287 Q 4 Yes . Yes. Do you know how it was -- when the development took place? 5 A Mid 1970s. 6 288 Q Mid 1970s? 7 A 8 289 Q 9 A 10 290 Q 11 A When was Portobello House developed? Yes . You were involved in that, were you? Yes . How much involved were you, Mr. Wood? I think I was involved as a 70% shareholder but I 12 can't say I was sort of a driving force or anything. 13 I mean I am not very good at these things. 14 Mr. O'Connor was much more involved in the technical 15 details of it and -- but I did write quite a lot of 16 letters to various people, you know, 17 about...(INTERJECTION). 18 291 Q 19 A No, I w a s n 't . 20 292 Q You were not? 21 A 22 293 Q For example were you paid a salary by Thrush? No. Was Thrush, was it, buying? 23 site? 24 doing? Was it developing the Was it buying up the site or what was it 25 A It bought Portobello House. 26 294 Q It bought Portobello House? 27 A 28 295 Q 29 A And converted it from a nursing home into offices. Yes? 1 296 Q. Yes. 2 A. 3 297 Q. 4 A. 5 298 Q. 6 A. 7 299 Q. Yes. 8 A. Yes. 9 300 Q. 10 A. 11 301 Q. You were a Director of the company? I was, yes, yes. Were you Managing...(INTERJECTION)? Sorry? Were you Managing Director or...(INTERJECTION)? We never give ourselves such titles. You were just a Director? I see? And I think I supported it with assets, borrowings. I am just wondering then, none of the funds, no 12 money from Thrush, went to any of the trust 13 companies in the Cayman Islands? 14 A. 15 302 Q. 16 No, it didn't. However, money from the Cayman Islands came to Thrush? 17 A. 18 303 Q. 19 A. 20 304 Q. 21 A. 22 305 Q. 23 A. That appears to be the case. Would you turn now to Brookfield Securities? Yes. This is Scotch House? That is right, yes. When was it incorporated and where? It is Irish and it would have been somewhat later 24 than Thrush. 25 image the late 1970's. 26 306 Q. 27 28 29 The exact date I don't know but I What did you do, what did the company do, in relation to Scotch House? A. It purchased it and the site was redeveloped and I think at a certain point the site next door was 1 incorporated into it. 2 Rhatigan and the two were amalgamated. 3 307 Q Yes. It was owned by people called Again what was the total involvement of the 4 company in the development, are we talking about 5 hundreds of thousands or millions? 6 A 7 308 Q 8 A 9 309 Q 10 A 11 310 Q 12 A 13 311 Q 14 A 15 312 Q 16 A 17 313 Q 18 A 19 314 Q Yes, hundreds of thousands. Hundreds of thousands? Yes, I think so, yes. Again was Guinness & Mahon the company's bankers? I think they were bankers, yes. Yes ? Yes, I am sure they were the bankers to it. Yes. Did you borrow money from Guinness & Mahon? Yes . Do you know what the security was for that? It would have been assets of mine. Yes ? More than likely CRH shares. Do you know was there any security given for any of 20 the deposits that were held by the Bank? 21 the deposits held by the trust in Cayman used as 22 security for these? 23 A 24 315 Q 25 A Was any of I don't believe so. Have you made enquiries? No, because the money out there -- all I know about 26 the money out there is that it went out there and it 27 subsequently came back, lodged to the two companies 28 that I mentioned. 29 1 2 317 Q. Do you not know that it was part of the arrangements 3 that Mr. Traynor and GMI entered into with various 4 clients, that monies were put on deposit by these 5 foreign companies, Cayman companies and Cayman 6 Trust, and then the trustee company, which was 7 Guinness Mahon Cayman Trust? 8 A. 9 318 Q. 10 A. 12 319 Q. 13 A. 14 320 Q. Yes, I have read that in the paper but that You did not know that before? No, I didn't know it before and it didn't happen Right. Brookfield Securities you said was in the late 197 0's ? 17 A. 18 321 Q. 19 Yes. How long did it go on for? How long was the development in existence for? 20 A. 21 322 Q. 22 A. 23 323 Q. 24 I would say about seven years. Seven years? Something like that. It would have gone on for some time in the early 198 0's ? 25 A. 26 324 Q. 27 29 Did you know that? with u s . 16 28 Deposited money in Dublin. didn't...(INTERJECTION). 11 15 Yes. Yes. Again, who owned the shares in Brookfield Securities ? A. Our group did, in approximately the same proportions as previously. Now, whether the Rhatigans had a 1 separate company or whether they were involved in 2 Brookfield I can't be quite sure at the moment. 3 325 Q. 4 Brookfield? 5 A. 6 326 Q. 7 A. Mine personally or the group? Yes, you personally? Mine would have been approximately 7 0% I imagine ag a i n . 8 9 Do you know what your shareholding was in 327 Q . 10 A. 11 328 Q. 12 A. Yes. Of our group. Did it make a profit? I can't recollect with Brookfield. I think it was 13 very modest if it did. 14 one and I think it might have just broken even again 15 but I can't recall. 16 329 Q. 17 Were any funds transferred by Brookfield Securities to any of the trusts in the Cayman Islands? 18 A. 19 330 Q. No. Why have you included it in paragraph 8? W h a t . . . (INTERJECTION)? 20 21 It certainly was a difficult A. Because I was asked I think what companies had any 22 connection with Guinness & Mahon and those are all 23 the companies that I could think of. 24 331 Q. 25 A. 26 332 Q. 27 28 29 However, that is Guinness & Mahon in Dublin? In Dublin. You thought that -- you put that in even though it had no connection at all with Cayman Islands? A. That is right, yes, yes. me to do so. I think the question asked Maybe I am wrong. 1 333 Q t h e . . . (INTERJECTION)? 2 3 A Yes, the question says: 4 "All bodies incorporated... READING INTO THE WORDS...with the company which had a direct or indirect interest." 5 6 7 So, I put them all in. 8 334 Q 9 A Yes, the company is "Ansbacher"? "Ansbacher" as opposed to Guinness & Mahon, is that so? 10 11 335 Q 12 A 13 336 Q 14 It is there in the letter Mr. Wood? I see, I beg your pardon. Would you come down to the paragraph headed Sandpiper Holdings? 15 A 16 337 Q 17 Yes . You say in the second paragraph that you have one document in handwriting giving, 18 "...a purported shareholding and a company structure; another, also undated..." 19 20 It continues: 21 "... shows that Rockrohan Estates..." 22 23 24 A 25 338 Q "...Rockrohan Estates Ltd., my family investment company, wrote a cheque for £ 2 1 ,0 0 0 . . ." 26 27 28 29 Rockrohan Estates Ltd. A 339 Q Yes . 1 2 3 4 340 Q. 5 A. Would you tell me about Rockrohan Estates Ltd.? Rockrohan Estates Ltd., is the company, the family 6 investment company, which was founded by my father 7 to hold shares and some land. 8 primarily the shares of Cement Roadstone, CRH pic, 9 which he obtained when his company joined the group. Those shares are 10 It is a bit more complicated than that. 11 CRH. 12 Limited and then went o n . . . (INTERJECTION). 13 341 Q. 14 A. 15 342 Q. 16 A. 17 343 Q. 18 A. 19 344 Q. So, it became a sister company of Roadstone The company owns shares, is that it? Yes, it does and some land. And some land? Yes. What land does it own? It owns part of the farm at home. Yes. I take it that it is an Irish registered company? 20 21 A. 22 345 Q. 23 A. 24 346 Q. 25 It is, yes. Are you the beneficial owner of all the shares? I am, yes. Would I be correct in saying that Rockrohan Estates Ltd., borrowed money from Guinness & Mahon? 26 A. 27 347 Q. 28 A. 29 It predates Yes, I think you are. Yes? Yes, and there is one thing I would like to draw 1 Sorry, if I can find it. 2 towards the bottom of the page, it mentioned 3 b ack i n g : 4 Yes, it is paragraph two "...and that £40,000 of this is backing my personal overdraft." 5 6 Now, that is a reference to backing which I came 7 across and I think what is meant by "my personal 8 overdraft" is, in fact, the overdraft of Rockrohan 9 Estates Ltd. 10 348 Q 11 A 12 349 Q 13 A 14 350 Q 15 A 16 351 Q 17 Yes ? It is in effect, you know, personal. Have you a personal overdraft yourself? With? With Guinness & Mahon? No, I don't. Any borrowing that you would have undertaken would have been by this company? 18 A 19 352 Q That is right, yes, yes. Would you mind Ms. Cummins giving the witness, it is 20 flagged two in our files, it is appendix 7/97A (Same 21 Handed) 22 A 23 353 Q (Exhibit 3)? Thank you. I want to refer you to a document, a 24 Guinness & Mahon document? 25 part there Rockrohan Estates Ltd.? 26 A 27 354 Q 28 A 29 355 Q Do you see the second Yes, yes. Do you see it shows a balance of £39,614? Yes . It shows the limit? 1 A. Yes . 2 Q. This is either the overdraft or loan, is that right ? 3 A. Yes . 4 Q. It shows the interest, it shows the maturity date? 5 A. Yes . 6 Q. 1977? 7 A. Yes . 8 Q. Can you remember getting either an overdraft or a 9 10 loan in that time? A. I can't say I remember getting it but I know it was in existence. 11 12 360 Q. 13 A. 14 361 Q. 15 A. Do you see "Security, suitably secured"? Yes, I see that. Do you know what that phrase means? I have never seen it before so I can only presume 16 that that connects with what I have written in my 17 letter here: 18 "...and that £40,000 of this is backing my personal overdraft." 19 20 So, I presume it refers to the Hexagon Securities 21 monies of £65,000 odd. 22 362 Q. Yes. Can you not recall the circumstances in which 23 you raised this loan and the terms on which it was 24 granted? 25 A. 26 363 Q. No, I am afraid I can't. The note, in your handwriting, would indicate then 27 that -- is this the note dated 7th July 1976? 28 you would just go back to page two, paragraph two? 29 A. Of my letter? If 1 364 Q 2 A 3 365 Q 4 A 5 3 66 Q That is the one, yes. A note in your handwriting? Yes . That note: "...says that Hexagon Securities had £65,225 on 31st December 1974 and that £40,000 of this is backing my personal overdraft." 6 7 8 9 A 10 367 Q 11 A Yes . What do you think that meant? Well, it means I presume that that facility which -­ 12 that that facility was extended to us and I must say 13 I had no recollection of it until 14 I ...(INTERJECTION). 15 368 Q 16 A 17 369 Q 18 A 19 370 Q You have no recollection of it? I have no recollection of it. Do you now h o w . . . (INTERJECTION)? Until I saw it in the file. Do you know how a trust company in the Cayman 20 Islands gave the backing for your personal 21 overdraft ? 22 A 23 371 Q I beg your pardon? Do you know how a company, a trust company, in the 24 Cayman Islands gave backing for your deposit here in 25 Ireland, for your loan here in Ireland? 26 A No, I am afraid I don't know how that arose. I mean 27 I presume I was aware of it at the time but all 28 memory of it has faded and I was surprised to come 29 across that in the file I must say. 1 372 Q 2 A 3 373 Q Yes . You accept then that this document of yours would 4 indicate that the Hexagon Securities was used -- its 5 funds were used as security for your overdraft? 6 A 7 I do accept t h a t . I accept that that certainly seems to be the case. 8 374 Q 9 A I do accept that. Yes? Did I say earlier in the interview that that 10 facility wasn't granted to us. 11 did. 12 was never granted to us. 13 375 Q 14 A 15 376 Q 16 A 17 377 Q 18 A I think perhaps I It was certainly in my mind that that facility Yes? But it does appear to h a v e . . . (INTERJECTION). To have been granted? To have been granted, it does, yes. Yes ? It does and that phrase "suitably secured" certainly 19 I think indicates it too, doesn't it, from the 20 Guinness & Mahon letter? 21 378 Q I take it you have been following what has been in 22 the press about Guinness & Mahon and about 23 "Ansbacher", have you? 24 A 25 379 Q 26 A 27 380 Q 28 29 Yes, I have. Have you b e e n . . . (INTERJECTION)? Yes . Have you seen this phrase "suitably secured" really in the public press? A I presume I have. I mean the arrangement came to my 45 1 2 381 Q. 3 A. 4 Yes? But I was very surprised to see this note in the file . 5 382 Q. 6 A. 7 383 Q. Yes? 8 A. Yes. 9 384 Q. Yes. 10 A. 11 385 Q. Yes? Because I had no recollection of it happening. Perhaps we can take a break now, Mr. Wood? Yes. We will have a cup of coffee. We can give you a cup 12 of coffee if you would like it. 13 to stay here we will go outside and we will be back 14 in about ten minutes? 15 A. 16 386 Q. If you would like As you wish. Thank you. 17 18 SHORT ADJOURNMENT 19 20 387 Q. MR. JUSTICE COSTELLO: Mr. Wood, we will resume now. 21 I have not got very 22 much more to ask you. 23 page of your letter where you deal with the three 24 companies (Exhibit 1)? 25 A. 26 388 Q. 27 A. 28 389 Q. 29 If we go back to the third Yes. You were referring to Rockrohan Estates Ltd.? Yes. Just come to Thrush Securities Ltd.? 1 390 Q. That refers then to a note on your file which seems to indicate that £22,000 came from abroad? 2 3 A. 4 391 Q. 5 A. 6 392 Q. 7 A. Yes. During April 1975 from Des Traynor? Yes. Where do you think that came from? Where do I think -- where the money came from do you mean? 8 9 393 Q. 10 A. Yes? Well, I can only presume that it came from the account in the Cayman. 11 12 394 Q. 13 A. 14 The Cayman Islands, yes? The funny thing is that I can't find that sum mentioned in the statements. 15 395 Q. 16 A. 17 396 Q. 18 Yes? So, I am at a bit of a loss to tell you the truth. Yes. Just turn over the page: "The second connection is the letter from Mr. Furze dated 16th March..." 19 And then the date, 20 "...telling me that £50,874.98 was remitted to Thrush Securities." 21 22 23 A. 24 397 Q. 25 A. 26 398 Q. 27 A. Yes. Could you tell us what that was? Again that is obviously from the same source. What was the source? Well, either Hexagon or Whitethorne Trust. As I say 28 I don't understand the arrangements they made in the 29 Cayman with regard to these. As far as I am 1 concerned there was just one account out there. 2 it has two names I don't know. 3 money which would have been sent originally from 4 Sandpiper Holdings, the Warrington Place investment, 5 and a small amount from Copenhagen, the Boreenmanna 6 Road investment. 7 3 99 Q 8 A 9 400 Q Why That is part of the Yes? That must be the origin of that money. Yes. Would you look at the next line: "The Thrush accounts for the period 16th March 1977 is a loan from a company called Merrimac." 10 11 12 13 A 14 401 Q 15 A 16 402 Q 17 A 18 19 403 Q A Yes ? And I am sorry that I haven't had the time to Yes. Where would you turn to try to get some Well, it is possible that Mr. O'Connor may have some recollection of it or possibly Mr. Field-Corbett. 23 404 Q 24 A 25 405 Q 26 A 27 406 Q 29 No, I am afraid I can't. information about Merrimac? 22 28 Can you recall what Merrimac is? investigate that for you. 20 21 Yes . Yes ? Or possibly Guinness & Mahon. Will you make enquiries for us? Certainly, yes, of course I will. The second last paragraph on page three refers to a letter, "...dated 16th March detailing the repatriation of funds, £50,874.98 for 1 2 3 And you say: 4 "...it brings to an end any involvement with Cayman accounts." 5 6 A. 7 407 Q. 8 A. 9 408 Q. 10 A. 11 409 Q. Could you just look at that letter for a moment? Which letter? The letter of the 16th March 1997 (Exhibit 4)? This one here? Yes. Do you see this is from Mr. Furze and it is headed "Guinness Mahon Cayman Trust Limited"? 12 13 Yes. A. Now, is this -- this must have been in my file -­ 14 yes, sorry, yes. 15 account? 16 you, yes. 17 410 Q. 18 A. 19 411 Q. 20 A. 21 412 Q. 22 A. 23 413 Q. 24 A. It is headed "Guinness Mahon Cayman Trust Limited"? Yes. I take it that you knew Mr. Furze? No, I never met him. No, but did you know who he was? He was a name in the Cayman as far as I was 26 him. 28 29 Yes, I am with Yes. concerned. 414 Q. Yes, the 16th March, yes. Do you see it is addressed to you? 25 27 Have I mentioned this in my I didn't know anything further about When you say "Cayman", can you be a bit more specific? 1 2 415 Q 3 From the Caymans, where? What was the heading of the note-paper he wrote from? 4 A 5 416 Q Guinness Mahon Cayman Trust Limited. He was connected with Guinness Mahon Cayman Trust Limited? 6 7 A 8 417 Q 9 A 10 418 Q Yes ? 11 A Yes . 12 419 Q 13 Yes, he was, yes. You knew that? Yes, because he signed the letter. Do you see what he is doing? He is sending you out: "I have pleasure in attaching hereto Statement of Affairs for both Whitethorne No. 7 Trust and Hexagon Securities Ltd." 14 15 16 A 17 420 Q 18 19 Yes . Why was Guinness Mahon Cayman Trust Limited sending you a Statement of Affairs? A Because this arose from the companies, which are 20 listed in this letter here, which are the companies 21 set up by the group that I have been mentioning, 22 myself or my family and Mr. O'Connor, Mr. Walsh and 23 Mr. Thompson. 24 421 Q 25 A Yes ? The proceeds of any of those companies, it was 26 arranged, would go to the Cayman but as I was the 27 nominal shareholder, the sole nominal shareholder, 28 and the others weren't shareholders, the letters 29 came to me rather than to anybody else. 1 422 Q You regularly received Statements of Affairs, did you? 2 3 Yes. A 4 I think I received them once a year or something like that. 5 423 Q 6 A 7 424 Q Yes ? There were quite long gaps. Yes. Telling you how Hexagon Securities Ltd., and how Whitethorne No. 7 Trust behaved, had got on? 8 9 A 10 425 Q I beg your pardon? You received these regularly, these Statements of Affairs ? 11 12 A 13 426 Q 14 Yes . Telling you how these companies got on, how these trusts had got on? 15 A 16 427 Q 17 That is right, yes. Would you just look at, if you would just turn over the page, the Hexagon Securities Ltd.? 18 A 19 428 Q Yes . Sorry, before we do that we will continue with the letter of the 16th March: 20 "The loan appearing on the Balance Sheet is the amount remitted to Youghal Developments and the figure of £50,874.98 represents the amount remitted to Thrush Securities." 21 22 23 24 25 A 26 429 Q 27 Yes . That means that £50,000 was paid to Thrush from Hexagon Securities Ltd.? 28 A 29 430 Q Yes . 1 Ltd., were trustees or was it a company managing a 2 trust? 3 I really have no idea. 4 431 Q 5 A 6 432 Q 7 A 9 433 Q 10 A The loan account of £27,500, Mr. Furze says that Yes . Was that a payment to them? It was, yes. I presume it was money which went to Youghal's account. 11 434 Q 13 No, you say "the repatriation of funds" in your letter of £50,000? 14 A 15 435 Q 16 A 17 436 Q 18 Yes, yes. What does that many? It came back from the Cayman to Ireland. It is a loan account but do you know was this a loan that Youghal then owed to Hexagon Securities Ltd. 19 A 20 437 Q 21 A No, I don't think so. You do not think so? Youghal had an overdraft here in Ireland and I think the money just went into the overdraft. 22 23 No. this was remitted to Youghal Developments? 8 12 You have no idea? 438 Q 24 It was a payment by Hexagon to Youghal so that Youghal could pay off its overdraft? 25 A 26 439 Q That is right. That is my understanding of it. Would you turn to the next document, the next one, 27 the profit & loss account for the period 1976 to 28 1977? 29 A 1 440 Q. "Interest received." Do you know what it received interest from? 2 3 A. 4 441 Q. 5 A. 6 442 Q. 7 I presume from the money lodged in the Cayman. Yes? As any deposit account would. This was apparently interest on the deposit account of Hexagon Securities Ltd., in Cayman? 8 A. 9 443 Q. 10 A. 11 444 Q. That is my understanding, yes. In the Cayman Bank? Yes. Yes. Did you know that it was, as far as we have 12 been able to ascertain, a very regular practice of 13 the Guinness Mahon Cayman Trust Limited, which had 14 money on deposit such as this, of sending a similar 15 sum on a deposit into Dublin, Guinness Mahon 16 Ireland? 17 A. 18 445 Q. Sorry, would you mind saying that again? Do you know that it was a regular practice for 19 Guinness & Mahon, for Guinness Mahon Cayman Trust, 20 which had money on deposit in the Cayman Islands 21 Bank, sending a similar sum to the Dublin Bank, its 22 parent company Guinness Mahon Ireland? 23 A. 24 446 Q. 25 A. 26 447 Q. 27 No, I didn't know that. You did not know that? No, I didn't know anything about that. Would you just turn over then to the last document "Whitethorne No. 7 Trust"? 28 A. 29 448 Q. Yes. The capital of that was £100. The trust was 1 established apparently with the £100. 2 tell me how you understand then the next -- the 3 third entry down: 4 Would you "Utilised as follows: 100 Hexagon Securities Limited Shares £50.00. . ." 5 6 7 Does it not look as if the Whitethorne Trust owned 8 Hexagon Securities? 9 A Well, I am afraid I have no view on any of that. I 10 don't understand it. 11 doing. 12 449 Q 13 A 14 450 Q 15 A 16 451 Q Try? 17 A Yes . 18 452 Q 19 A Try Mr. Wood? Yes . You are a businessman, Mr. Wood? W e l l . . . (INTERJECTION). How do you read that? I find it rather difficult. 20 read that. 21 mean? 22 453 Q 23 A 24 454 Q 25 26 I don't know what they were I don't know how to The capital amount £100, what does that If doesn't mean anything to me. Does it not? Maybe I received £100 at some stage. Does it not mean to you that the trust was set up with £100? A 27 Yes, that is what it means but whether it received £100 or not, 28 455 Q 29 A you know -- I presume it did. You presumed it did? 1 456 Q 2 A 3 457 Q 4 What did it do then? It would utilise £100. It bought 100 Hexagon Securities Ltd., shares at £50? 5 A 6 458 Q 7 A 8 459 Q 9 A Well, presumably, yes. Yes, but why I have no idea. No, no, do not worry about the why? Yes, Okay, yes. How do you read this? It spent £50 on buying 100 Hexagon Securities Ltd. Shares. 10 11 4 60 Q 12 A 13 461 Q 14 Therefore it owned 100 shares in Hexagon? That is right, yes, yes. Does it not look then as if the trust owned Hexagon Securities Ltd.? 15 A 16 462 Q 17 A 18 463 Q 19 A 20 464 Q 21 A 22 465 Q 23 24 Yes . Yes. Well, it owned 100 shares in it. Look over the page, the first page? The first page? Share capital £50? Share capital? Yes? Yes, share capital £50, yes, yes. You seem surprised at all this Mr. Wood, am I wrong in that? A 25 Well, to tell you the truth I have never taken much notice of it. 26 4 66 Q 27 A Have you not? No. 28 Having brought it to your notice now what conclusion 29 do you reach? Hexagon.. . (INTERJECTION). 2 3 468 Q 4 A 6 4 69 Q 7 A 8 470 Q 9 A 10 471 Q A 13 Owne d . . . (INTERJECTION)? Hexagon Securities. All the shares in Hexagon Securities Ltd.? Well, is it all there? I presume it is all. Why do you presume it is all? Can you Well, I mean I don't know how many shares there are i n . . . (INTERJECTION). 14 472 Q 15 A 16 Yes. If you look at its "share capital 50"? All right does that indicate it owns the full amount, Okay. 473 Q 18 19 Well, Whitethorne Trust.. . (INTERJECTION). n o t . . . (INTERJECTION)? 11 17 You are an experienced businessman. "Some relationship", what relationship? 5 12 Now, come come, Mr. Wood. Fair enough. Do you not think it does, if a Statement of Affairs says the share capital was 50? A Sorry, that is true. Of course, yes, you are quite rig h t . 20 21 474 Q 22 A 23 475 Q 24 A 25 476 Q 26 A 27 Then what is the conclusion? That one owns the other. Which owns which? Whitethorne owns Hexagon. Yes. Very well? I have no idea what that means I mean, you know.. . (INTERJECTION). 28 477 Q 29 A Have you not? 1 478 Q. 2 A. 3 479 Q. 4 Does it? I think so, doesn't it? With regard to Whitethorne No. 7 Trust, can you tell us about that? 5 A. 6 480 Q. 7 A. 8 481 Q. 9 I can't tell you any further. Yes? Than is on these sheets. Did you not make enquiries at any time as to when Whitethorne No. 7 Trust was set up? 10 A. 11 482 Q. 12 A. 13 483 Q. 14 A. 15 484 Q. 16 A. 17 485 Q. 18 No, I didn't. Will you? Certainly, yes, if you wish. Yes, we would? Yes. We would want you to do that? Right, certainly. Do you know where you would make enquiries? you could go to make enquiries about this? 19 A. 20 486 Q. Yes? 21 A. Yes. 22 487 Q. 23 Guinness & Mahon I presume. Do you know were you involved in establishing it at all? 24 A. 25 488 Q. 26 A. 27 489 Q. 28 A. 29 Where No. You were not? No. Did you know how it got its name? No, I know nothing about it whatsoever. All I was concerned about was that money was sent out there, the money was accounted for, and the money returned. 1 2 490 Q Yes. Did you know that other trusts were set up in 3 the Cayman Islands, Whitethorne No. 6 Trust for 4 example? 5 A Well, if there is a Whitethorne No. 7 presumably there is a ...(INTERJECTION). 6 7 491 Q 8 A 9 492 Q 10 A 11 493 Q No, b u t . ..(INTERJECTION)? I mean I am only presuming. I don't know. You do not know? No, I don't. Could I suggest that you would make enquiries in 12 Stokes Kennedy Crowley about a Mr. Don Reid who is 13 retired now from Stokes Kennedy Crowley, but was 14 involved in establishing Whitethorne No. 6 Trust? 15 A 16 494 Q 17 A 18 19 Well, certainly, if you wish. W e l l . . . (INTERJECTION)? Obviously this is leading somewhere but I am quite blind. 495 Q I don't understand it. No, what I am trying to get your assistance on 20 Mr. Wood is to make enquiries about the 21 establishment of Whitethorne No. 7 Trust? 22 A 23 4 96 Q Y e s , ri g h t . What I am suggesting to you is that whilst you have 24 said that you will ask Guinness & Mahon, that you 25 would also, I suggest, ask Stokes Kennedy Crowley? 26 A 27 497 Q 28 A 29 498 Q Yes, certainly. Very well? Yes . Very well. That is all the questions I want to ask 58 1 you. Mr. Rowan might like to ask you some 2 questions ? 3 4 5 END OF EXAMINATION OF MR. WOOD BY MR. JUSTICE 6 COSTELLO 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 1 M R . ROWAN 2 3 4 MR. ROWAN: Mr. Wood, if you please 5 turn to the second page of 6 the batch of documents which we have just being 7 looking at, the Hexagon Securities Balance Sheet, 8 please (Exhibit 4)? 9 A 10 500 Q Yes . That Balance Sheet looks a little unusual, not 11 having any assets in it but has liabilities but no 12 assets. 13 A What do you make of that? Personally I make nothing of it. I don't understand 14 this -- the arrangements they made out there in the 15 Cayman. 16 an account, remained in that account, earned 17 interest and returned. 18 account. As far as I was concerned money went out to To my mind it was an So, I don't make anything of it. 19 501 Q Where is the account shown on that Balance Sheet? 20 A Well, these are the arrangements that were put in 21 place. I don't know. I can't answer your question. 22 I am merely saying that these are the arrangements 23 that were put in place, I think by Des Traynor, a 24 very long time ago. 25 I don't understand the arrangements. 26 In the letter of the 16th March Mr. Furze invites 27 you to sign a copy of the letter enclosing "the 28 Statement of Affairs and return it to our Dublin 29 Office". I had nothing to do with it and You were asked to indicate that you agreed 1 with the contents of these Statements at that time? 2 Yes, that is right, but as far as I was concerned -­ 3 I was only worried about the actual cash. 4 503 Q 5 A 6 504 Q 7 A 8 505 Q 9 A 10 506 Q However, there is cash shown in Hexagon? No, Okay. Well, fair enough. Yes, fair enough. That is the b i t ...(INTERJECTION)? Well, sorry...(INTERJECTION). That is the bit that is intriguing? There is the £78,000, isn't there? It does not say that that is a bank account, does it? 11 12 A 13 507 Q 14 A 15 508 Q No, it doesn't. No, I agree, it doesn't. Yes? It just says its money. Yes. Ultimately, strangely enough, although it does 16 not say that it had money in a bank account, it did 17 indeed pay over those amounts of money to Youghal 18 and to Thrush? 19 A 20 509 Q 21 A 22 510 Q Yes, as I would have expected. Yes? Because that is what we asked to happen. Very strange. The other matter I would like to 23 raise with you is that in the third paragraph of the 24 letter of the 16th March, Mr. Furze says: 25 "I would confirm having received instructions from Mr. Don O'Connor confirming that we should wind up the company effective 28th February." 26 27 28 29 A Yes . Was Mr. O'Connor empowered to give instructions of 61 1 2 Yes, but I don't think formally. 3 of Guinness & Mahon, and he was one of our group, 4 and I think it is quite natural that decisions being 5 made of that nature would be conveyed through him. 6 512 Q Did you say earlier in your evidence that 7 Mr. 8 these development companies? 9 A 10 513 Q O'Connor was very much involved in running Yes, he was. Would that account for why he then would perhaps be giving instructions of this sort? 11 12 He was a Director A 13 Yes, and also I think the fact that he was a Director of Guinness & Mahon at the time. 14 514 Q 15 A Why would the latter point be relevant? Well, well, he had dual expertise as it were as a 16 person who knew intimately about building and 17 property development and also he was a members of 18 the Guinness & Mahon team. 19 Guinness & Mahon, is what I mean by that. 20 515 Q He was a Director of Why would that have given him authority over Hexagon Securities ? 21 22 A 23 516 Q 24 A 25 517 Q Because he was a member of the group of four people. Yes ? Which worked closely together. I see. I do not have any other questions. 26 you. 27 END OF EXAMINATION OF MR. WOOD BY MR. ROWAN 28 29 Thank 1 M S . MACKEY 2 3 4 518 Q. MS. MACKEY: Mr. Wood, you mentioned a 5 few moments ago that as 6 far as you were concerned what you wanted to know 7 about was the fact that money went out there, that 8 it earned interest, that it was accounted for, and 9 that it came back? 10 A. 11 519 Q. You, I think, as you explained were the nominal sole shareholder in these companies? 12 13 A. 14 520 Q. 15 A. 16 521 Q. 17 A. 18 522 Q. 19 Yes. Which were utilized by this group? Yes. The Statement of Affairs and so on came back to you? Yes. You were the person that signed the Statement of Affairs, and made decisions and so on? 20 A. 21 523 Q. 22 A. 23 524 Q. 24 Yes. And that the people in Cayman referred to? Yes. You knew that this money whereever it was, it was in an account you say, earning interest? 25 A. 26 525 Q. 27 A. 28 526 Q. 29 Yes. Yes. Did you declare that interest to The Revenue? I believe not. You believe not? 1 527 Q After your father's death Mr. Wood what was your role in the company J. A. Wood? 2 3 A 4 528 Q 5 A Yes . 6 529 Q Okay. 7 A 8 530 Q 9 A 10 531 Q 11 A 12 532 Q 13 A 14 533 Q 15 You became Chairman? That was 1972, is that right? 1972, yes. Until? Well, I am still Chairman of it. You are still Chairman? Yes . I see. That is your present position? Yes . When did you become a Director of Cement Roadstone Holdings ? 16 A 17 534 Q 18 A 19 535 Q 20 A 21 536 Q 22 A 23 537 Q 24 A 25 538 Q In 1981. How long did that continue? Until about three years ago. Until 1997? Yes, approximately. Were you an executive or non-executive Director? Non-executive. Non-executive? Yes . In your role as non-executive Director did you come much in contact with Mr. Traynor? 26 27 I became Chairman of it. A From time to time. Mainly at board meetings and 28 occasionally when we went abroad on trips to view 29 various facilities, which we had abroad. 1 539 Q 2 A 3 540 Q Or in Ireland, indeed around Ireland. Were you aware of Mr. Traynor's involvement with the 4 company, as we call it, "Ansbacher" Guinness Mahon 5 Cayman Trust? 6 A 7 I had ceased to be aware of it to tell you the truth. 8 541 Q 9 A I ... (INTERJECTION) . You had ceased to be aware of it? Well, what I mean is that I was obviously aware when 10 we were involved. 11 -- whenever it was 12 542 Q 13 A 14 Right. Our involvement came to an end in -- was it 1977? If I could just ta k e . . . (INTERJECTION)? And after that it just, you know, faded from my mind. 15 543 Q 16 A 17 544 Q 18 You ceased to be aware? Yes . Tell me about your awareness during the time that you were involved? 19 A 20 545 Q It w a s . ..(INTERJECTION). Let me put it this way: When did you first become 21 aware that Mr. Traynor was involved in Guinness 22 Mahon Cayman Trust? 23 A I mean I can't remember whether it was — I presume 24 it was before -- yes, it would have been before my 25 father died. 26 546 Q 27 A 28 547 Q 29 Before your father died? Yes . At that stage did you know that Mr. Traynor was involved with the same company that your group of 1 companies here were involved with in the 2 Cayman Islands? 3 Sorry, he wasn't directly involved with our group of 4 companies. 5 548 Q 6 A 7 549 Q 8 A 9 550 Q 10 A 11 551 Q The Caymans. The Cayman Trust? The Cayman Deposit, yes, the Cayman Trust. Yes ? Sorry, what was the question again? Tell me what you knew he was involved in, in the Cayman Islands? 12 13 No, but it is Ansbacher which was...(INTERJECTION)? A Yes, all I know is that the scheme for lodging money 14 in the Cayman was one which was, as far as I was 15 aware, was devised by Mr. Traynor. 16 552 Q 17 When you say the scheme, the one that your group of companies was involved in, that scheme? 18 A 19 553 Q The one for depositing money in the Cayman. Yes? 20 My understanding of it was that it was taking 21 advantage of a loophole in the laws or a weakness in 22 the laws and I was certainly not aware that there 23 was anything illegal about it. 24 after all a banker and those were the days when one 25 trusted bankers. 26 think any of us felt that there was anything illegal 27 about it. 28 been involved if there had been illegality, that you 29 know, we understood it to be illegal. Mr. Traynor was I would be very surprised, I don't I doubt very much any of us would have 1 554 Q 2 A 3 555 Q 4 Yes . He had devised, as you say, this scheme for tax avoidance? 5 A 6 556 Q Yes . This was in fact the scheme then that the group of 7 companies which your group was involved with availed 8 of, is that right? 9 A 10 557 Q That's right, yes. At the time that your group of companies was 11 involved in this, you knew Mr. Traynor was involved 12 in it with that? 13 A 14 Yes, I had some idea that he was. He was very much in the background as far as I was concerned. 15 558 Q 16 A 17 559 Q 18 A I see. Did you get any advice from him about it? Not directly, no. When you say not directly? I presume the advice, all the advice in connection with it came from him. 19 20 560 Q 21 A Who would he have given that advice to? I presume it came through Mr. O'Connor but again 22 this all happened before my father's death and I am 23 not sure precisely how it occurred but that is my 24 surmise. 25 561 Q Youghal Developments, is that a company incorporated 26 in Ireland or is it in incorporated in the 27 Cayman Islands, do you know? 28 A 29 562 Q I will have to check that, I am just not sure. Finally, just if I could refer you again to the 1 written statement you provided for u s . 2 bottom of page two, numbered page two of that where 3 you talk about Thrush Securities (Exhibit 1)? 4 Yes . 5 563 Q At the You see Thrush Securities there at the bottom of that? 6 7 A 8 564 Q 9 Is that in paragraph two, page two is it? Page two, it is at the top of that page there, number two, do you see it? 10 A 11 565 Q Yes . Then you have a paragraph at the very bottom headed: "Thrush Securities Limited?" 12 13 A 14 5 66 Q 15 Yes, I beg your pardon, yes. The very final statement there says: "I can find no mention of this sum." 16 17 You are referring to a sum? 18 A 19 567 Q 20 A 21 568 Q 22 A 23 24 Yes . "In the statements sent to me from the Cayman?" Yes . What are those statements that you refer to there? They are statements of the account, as I thought it was, which was earning interest. 5 69 Q 25 Are they similar to the statement of affairs of the company that we looked at a moment ago, the Hexagon? 26 A 27 570 Q 28 A 29 571 Q No, they are actual bank statements. Bank statements and have you provided us with those? Yes, you have them. 1 2 572 Q 3 A 4 5 They do. I can't guarantee they are complete tho u g h . 573 Q Yes. How did these statements come to you, were they sent? 6 7 A 8 574 Q 9 A 10 575 Q 11 A 12 576 Q 13 A 14 577 Q 15 A Just in the post. In the post? Yes . Who sent them do you know? I presume Mr. Furze sent them. Mr. Furze sent them? Yes . And how frequently would they arrive? That is what I was trying to recollect. They were 16 infrequent and I don't know whether they were six 17 monthly or yearly. 18 yearly. 19 578 Q 20 A 21 I have a notion they were They did not come very often. Anyway we have them there? You have them, yes, you have what I have. MS. MACKEY: Yes okay. That is all the questions I want to ask 22 23 you, Mr. Wood. 24 through all the documents that you provided for us, 25 we might want to talk to you again but the Judge 26 will 27 Yes, certainly. 28 29 — It may be that when we have read 1 2 3 4 579 Q. MR. JUSTICE COSTELLO: 5 Just a couple of points Mr. Woods, I should 6 have asked you. I forgot to. Did this letter of 7 the 16th March 1977 (Exhibit 4); you say that it 8 brings to an end any involvement with Cayman 9 accounts. That was the winding up of this company Hexagon Securities Ltd.? 10 11 A. 12 580 Q. 13 Yes, that is my understanding of it, yes. Did you not have any further dealings then at all with the Guinness Mahon Cayman Trust Limited? 14 A. 15 581 Q. I don't think so, not to my knowledge. What about your own company that had obtained a loan 16 which was backed, as we have seen, did you continue 17 to obtain loans from Guinness & Mahon for your own 18 company? 19 A. I think what was happening was my company was 20 raising funds to support these development 21 companies. 22 582 Q. 23 A. Yes? I don't understand that backing reference but 24 assuming that that took place and obviously it seems 25 to have done so, when the backing, as it was, 26 presumably in 1977 with the return of the funds, I 27 assumed that alternative security arrangements were 28 put in place and that Guinness & Mahon were given 29 possibly CRH shares belonging to Rockrohan Estates 1 2 583 Q. You had nothing further then to do with any trust in 3 the Cayman Islands or in the Guinness Mahon Cayman 4 Trust Limited after that? 5 A. 6 584 Q. 7 A. 8 585 Q. 9 A. I believe there was no further involvement. Yes, very well? Could I just say finally one further point? Yes, of course? Just to reinforce what I was saying earlier about 10 the legality point and trusting bankers and so 11 forth. 12 became Chairman of CRH and that was while I was a 13 director so I was involved in his selection as 14 Chairman. 15 anyone whom we felt had been involved in illegality. 16 586 Q. 17 A. As you know, Mr. Traynor subsequently Obviously, we would not have selected Yes? In the light of subsequent information that may seem 18 rather extraordinary but that certainly was the case 19 at the time. 20 point. 21 587 Q. Sorry, I just wanted to make that Just arising from that, we understand that 22 Mr. Traynor had an office in the premises of 23 Cement Roadstone? 24 A. 25 588 Q. 26 Did you ever transact any of your business with him in that office? 27 A. 28 589 Q. 29 Yes. No. You did not? 1 When I became a director, I became a director in 2 1981, the Cayman, my involvement with the Cayman 3 ended in 1977. 4 590 Q 5 A You did not have any cause to? No, none, no and in fact I can't remember ever being 6 in that office. I had no idea what he was doing 7 there and again it was a case of trusting bankers 8 and one didn't interfere with their private affairs. 9 That is a similar situation to my own in 10 John A. Wood Limited where I am a non-executive 11 Director and I have an office and I continue doing 12 my own affairs there and nobody in the company 13 interferes with me. 14 situation and there are lots of other non-executive 15 Chairmen throughout CRH who have the same 16 facilities. 17 591 Q It is exactly the same Mr. Wood, we have to ask you to sign this transcript 18 of your evidence here today when that is available 19 and Ms. Cummins will be in touch with you. 20 have to call you back when we have looked at the 21 documents you have given us and we would be grateful 22 if you would make the enquiries which we have asked 23 you? 24 A Yes and I take it you got a list of the questions, 25 do you? 26 MS. CUMMINS: 27 You do, that is all right. 28 29 We may I do. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED (21$ Y?th QKM MQM obiulyop ?\ster Hey-{k 5?000 . ?339)(1Hb) I '7 I R O C K R O H A N , C A K K 1G R O H A N E , C O U N T Y C O R K . Telephone: (021) 541019 RFW/LO’R 16thMarch, 2000. The Inspectors, Office oftbeInspectors to Ansbacher (Cayman) Ltd., 3"1Floor, Trident House, , Blackrock, . Co. Dublin. Dear Sirsand Madam, ' After the passage of so many years itisnot possible to answer your question about my dealings with Messrs. Guinness and Mahon inas detaileda manner as you have requested. Thus I feel it would be helpful ifI firstly gave you a narrative account, which will give you a picture of what took place and will, I hope, be of some assistance. This is then followed by answers to the questions you posed, which areasdetailedasIcan make them. The train of events began before the death of my father, which occurred in February 1972. He and three friends, . and Xx. xy decided to get involved in some modest property development, firstlyin Youghal, Co. Cork, as well as in Cork City, and then inDublin where xv had moved after leaving the company inCork. At thisstage y_>c had become a directorofGuinness and Mahon Ltd. It is most important to appreciate the form of relationship that existed between the members of this group; itwas one of great trust Literally, theirword was their bond and a promise given was never questioned. Thus an informal company arrangement was put inplace with my father, as theprovider of funds, as guarantor. Whereas he was the sole beneficiary ofwhatever company might be created as the 'vehicle for a particular development, he gave his word that any surplus would be divided as follows: 70% to himselfj 14% to. v y . / 8% each to * >: The three, were never shareholders in any ofthe companies used for any ofthe propertydevelopments undertaken. These shareholdings appear to have varied slightly from company to company. Both xy , and x x were to be paid fortheir professional services. xx »a colleague of x x in Guinness and Mahon, was asked to act ina managerial capacity. Answers to Q uestions M f r g S With the CQffiPBBYt Following my father’s death in 1972,1 dealt with Guinness and Mahon largely on a “drop in” basis, being friendly with ■xx . I met . V x rarely, and Mr. Des Traynor inpassing once or twice. Apart from this I can recollect one more formal meeting with these threedirectorsbut Icannot remember itscontent. Apart from my personal advisers, we used the services of Management and Investment Services Ltd. to do secretarial work for some ofthe companies involved, on the advice of Guinness and Mahon. was involvedprimarily, and also acted. Three companies appear to have had connections with Cayman; Youghal Development Co. Ltd., Copenhagen Investment Co. Ltd.,and Sandpiper Holdings. Their proceeds were handled through Hexagon Securities and Whitethorne No. 7 Trust in the Cayman. I do not understand the relationship between these two, they appear to have been amalgamated. See the file with their name. A fourth company, Thrush SecuritiesLtd., benefited from the proceeds of funds lodged in the Cayman. I will deal with Youghal firstly, then Copenhagen, then Sandpiper, and finally Thrush. * Cayman TsfawH Twists and Trust Companies la. - The earliest evidence I have ofany dealings with Cayman Islandbanks is a letterof 6r June 1969 from Des Traynor to v.> enclosing one to John Furze ofthe Bank ofNova ScotiaTrust Company (Cayman) lid. (seeYoughal Development file). * There appears to be no deed ofcontract - Advice was given by Mr. Des Traynor of Haughey Boland & Co., 61/62, Amien Street, Dublin 1, and X>. both subsequentlyofGuinness & Mahon. - There appearsto be no Deed ofTrust. - There appears to be no Articlesand Memorandum ofAssociationnor shareholdersagreement, lb. * Cash was firsttransferred before 20* November 1969, see letterofthat date in Youghal file, but thfa was merely for setting-up cxp*w<«s_ A draft statement of affairs of the company, dated 28* August 1975, (see Youghal file), shows that £1,300 had been sent to the Cayman, ...... presumably aspayment ofGovernment charges and fees. lc. . .. > it appears tfw* Youghal never a profit, in fact a handwritten document dated r July .1976 aeons to indicatethat itsliabilityat that time stood at £46,300. Though I do not folly understand this document, it seems dm* my nett allocation of this liability, £26,200 was gatiafiftrf ftom •fiinHs lodged’in the Cayman from die Warrington Place, and Boreenmanna Road ventures (see note date 28* October 1976 inYoughal file). The Youghal property was then sold and foe filecomes to an end. 2. Itappears thatthe fcmfy raised for Youghal Development Co. Ltd. came from Irishbanks and were backed by the deposit of assets here in Ireland, though itmust be said that this is not entirely clear. I came across a note in a strange hand, which mentions backing. I do not understand it It isdated 7thJuly 1976. See Youghal file. A note in my handwriting dated 18* April 1975 (see Thrush 72-77 file) says that Hexagon Securities had £65,225 on 31 December 1974 and that £40,000 ofthis isbacking my personal overdraft. 3 and 5 Iam not aware ofany transactions withIrishIntercontinentalBank Ltd. . . 2 C O N T IN U A T IO N S H E E T N O . 4. I am not aware ofany loan and guarantee facilitiesprovided by Guinness and Mahon (Ireland) Ltd. 6 . I am not aware that any application for permission under the Exchange Controls Act was made in relation to the company’s transactions. I certainly was neither aware, nor was made aware, ofthe necessityfor suchpermission. 7. Though I have come across one reference to “a Jersey Company” in the Thrush 1972-1983 file, (see “Jersey Co.”) I do not understand the reference and have no recollection of the matter. . 8. Companies Company Name Youghal Development CO. Ltd. Copenhagen Investment Co. Ltd. Sandpiper Holdings Thrush SecuritiesLtd. Brookfield SecuritiesLtd. Property Youghal ■ Borecnmaima Road WarringtonPlace PortobelloHouse Scotch House. Copenhagen Investment Co. Ltd, I can find only two references to this company, which appears to have carried out a minor development on the Boreenmazma Road in Cork. One is a letter from Sc >. to me regarding the incorporationofthe company, dated 18* September 1974. The other isa note in my handwriting dated 28* October 1976, which indicates that Copenhagen made a surplus of £7,500 and thatthiswas transferredtothe Cayman. Both are stapledtogetherand arc to be found under the date 28* October 1976 inthe Youghal file. •SmtlpiWi HoMmga ' . . .. ■■ This isthe conpany thatwas createdtodealwith the WarringtonPlace development. I have only three documents that mention it One, undated and in my handwriting, gives a purported shareholding and company structure; another, also undated and also in my hand, shows that Rockrohan Estate Ltd., my fam ily investment company, wrote a cheque for £21,000 for the benefit of the Warrington Place venture; the third is a letter from Maurice O ’Kelly of Guinness and Mahon Ltd., dated 19® April 1973 (see Youghal file, clipped together atthe back) returning the £21,000 investment upon completion ofthe project, and saying that a sum of£55,694.37 has been transferred to a Trust Account. Thrush SecuritiesLt32 Add: Balance forward at 31/3/1976 73,096.66 £78,324.98 Agreed as being correct: Signed:, P.O. Box 887, Grand Cayman B.W.I. £100.00 Capital Amount 390.82 Loan from Hexagon Securities Ltd. £490.82 Utilised as follows:- , 50.00 100 Hexagon Securities Limited Shares Government Stamp Duty .. 23.12 417.70 Trustees-Acceptance Fee • Agreed as being correct: . £490.82 ..;v . • ■■■■■y a m m i :* * * * ’.• '• , . . ' pwrrf'i'Jlf/fi . . ".* * * - ’> ’• ’ " ' January 28, 1976 * ,) ' . ‘ ' Mr. T. R. Leonard Guinness £ Mahon Ltd. 17 College Green Dublin 2 ZSEXJUBD • ar ftt: As Mr. Traynor will probably have advised you, I an anxious to ensure that these are as few overdrafts on any of the corporate accounts, which we manage, at the end of March as possible. In this connection, X wonder whether you can con­ firm that >200 has been credited to our sundry sub-company account in connection with Equinox Holdings (this was mentioned by JOT in one of his recent letters to me concerning this company) and also whether you can arrange . for the transfer to the sundry sub-company account of *200 J from the *A/G" deposit series in connection with additional funds required for Hexagon Securities Limited. X Your assistance in this connection is much appreciated. Yours sincerely. * T K ' X R O H A X C A R R I G R O H A N E , C O U N T Y CORK. Telephone: (021)4541019 3 rd Decem ber. 2001 ' ~ f *' M s. N oreen M ackey, B.L., Mr. Paul Rowan, F.C.A., Mr. M ichael Cush, S.C., Inspectors. Dear M adam and Sirs, I am grateful to you for affording m e an opportunity to provide you with a written reply to your preliminary conclusion, based on the evidence provided to you, that I was a client o f G uinness M ahon Caym an Trust Limited. Having spoken further to those w ho were connected with my late father in the initiation stages o f this business I would like to make the follow ing points. In the late sixties my father made the decision to enter the property developm ent business as a sideline. Taxation on such developm ents w as so high and determined in such a harsh manner - all profit being treated as income in the year that it arose and therefore subject to the highest rate - that businessm en attempted to find legitim ate w ays around this problem, w hich had the effect o f stunting the developm ent o f Dublin and elsew here and hindering econom ic activity. In m y father’s case he w as advised to go to M essrs. Haughey Boland for accounting and taxation advice and it w as there that he first met Mr. D es Traynor. Mr. Traynor devised the schem e w h ich was put in place, the details o f w hich I have already given to you. Incidentally, this w as som e years before Mr. Traynor and m y father became colleagues on the board o f Cem ent-Roadstone H oldings Ltd. (now CRH pic), w hich w as created by the m erges o f Cement Ltd. and Roadstone Ltd. Mr. Traynor had been on the board o f Cement Ltd. and m y father had been on the board o f Roadstone Ltd. There w as never any suspicion that Mr. Traynor’s schem e w as illegal; neither m y father nor his colleague in this business, the late Mr. Fred Thom son, retired A gent o f the Bank o f Ireland in Cork, w ould have countenanced such a thing. Both were honourable men, and so were the others w ho w ere associated with them. In any case, I had no know ledge o f the arrangements made and w as aware o f no reason w hy they should be questioned. I inherited the situation from m y father and I never had a reason in m y life to doubt either his honesty or his integrity. When, therefore, m oney becam e available from the first o f the developm ents to mature, which happened in 1973 after the death o f my father in 1972, I adhered to the steps o f the schem e devised by Mr. Traynor and sent the surplus to the trusts set up by Guinness Mahon Cayman Trust Ltd. Subsequently, all the funds (£78,374.98) were returned to Ireland in 1977 and invested in Irish development companies which undertook development work here in Ireland. During all this time I relied on professional advice in ensuring that all other legal obligations were met. I am not aware o f any shortcomings in that regard. Hence I would be grateful if, in future publicity created by those who publish the conclusions o f the investigations presently in hand, my name might be cleared o f the taint o f suspicion that currently attaches to it. Yours sincerely, Richard Wood. Appendix XV (140) Mr Christopher Woodward 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Christopher Woodward. a) Guinness and Mahon file note re credit committee meeting o f 28 February 1978. b) Guinness and Mahon loan memo o f 28 February 1979. c) Guinness and Mahon file note o f 23 March 1979. d) Letter o f 23 August 1979 - Guinness and Mahon to Mr Christopher Woodward. e) Guinness and Mahon file note o f 12 October 1977 - P O ’Dwyer to TRL. • * o .■ ^ FILE NOTE V . ,:;. ^ k ' ’ CHRISTOPHER WOODWARD Loan £18,948.75 Interest Rate 1% At a Credit Committee meeting h61d on 28th February, 1978 It was agreed to extend the above Loan for a further period to 30th April, 1979. No formal facility letter has been Issued. John Collins of Guinness Mahon Cayman Trust has been advised. ■ ... PO’D/SM R E F E R E N C E _________ M I N U T E N U M B E R __________ D A T E N A M E O F A P P L I C A N T : <% *& (<> AMOUNT : 9 * e 7 5 PURPOSE : T E R M & SOURCE OF R E P A Y M E N T S : RATE ; C O M M I T M E N T F E E s N tt* S ECURITY : REVIEW D A T E :A - 79 OTHER RELEVANT COMMENTS FOR I N C O R P O R A T I O N IN DECISION M E M O . /G ^ U & c f ^ 3 0 ^ C fe f T 9 '1 I: ••:•;• . • • ■tv PO’D/SM 23rd March, 1979, . ■•■'. ;»>**£■> . ■ -,rv- . Z^F- / ^ • ■•» ■ >,*_ ’ * . . ■ ■„• to d p*- Our Raf» TRLiAB 23rd. August 1979 Mr. Chris Woodward. Herm Houss, Mont du Coin, St.Aubin, Jersey. C.I. Dear Chris, At Martin’s request X have sent for collection the U.S.Dollar cheque for 2,250.00 recently sent to him. This will be credited to an account with G.M.C.T. under the designation G.M.C.T. "CUT Call Deposit Account. Yours sincerely. P. O'D to T. R. L. 12th October 1977. I attach a photo-copy of a letter addressed by John Collins to J.D.T. In connection with loans in the name of C.D. Woodward, X V ' The loans recently matured, hence my telex enquiry to •/.) John Furze, on the instructions of J.D.T. requesting possible extent ions in respect of the loans. 4 ' •' moments in order 'that w Perhaps you would kindly spare •a few we night discuss the position. ' ' c.c. U.C.K. PO'D/AC J lT h P. O ’Dwyer. PO’D/AC Appendix XV (141) Mr Ronald Warren Woss 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Ronald Warren Woss. a) Letter o f 7 May 1993 - Hamilton Ross Co Limited to IIB. b) Internal IIB memo o f 1 July 1992 - Ronan Redmond to Maureen Collins. c) Letter o f 29 August 1990 - Ansbacher Limited to Guinness and Mahon. d) Extract o f transcript o f evidence o f Mr Sam Field-Corbett dated 31 July 2001. _ 42nttwBBMS4“ *°* P.O.BOKIt7,OnedCiyiiee.C«y«w hi**, lhti* Wen InSet Tctapboae:(109)9494633 Tdex: CP4303 SffiW5144«?63065 ft«*»ilc<«09> 949-7946. <*»>949-5267 Fax: 6612035 ? t h M ay, 1 9 9 3 . Ro n a n Redaond, B s q . , Corporate Services# Xriah Intercontinental Bank Limited, 91 M e r r io n S q u a r e , Dear Ronan, * . Could you please arrange to transfer 8tg.£4,300.00 aa quickly a s possible to: Barclays Bank PIC 01 fleet Str««c London EC4Y 1ST for credit to: Account CV Travel Account No.60287377 with a notation "Corfu Reservation - R.tf. Host" ^ /* M e a a e debit the cost to Hamilton Ross Account Ref. A/A26 N o . 19/39244/81. Yours sincerely. L Or HAMILTON Sasjfti L 4?.ry r RQ8S CO. LIMITED : looazx. I R I S H I N T E R C O N T I N E N T A L I N T E R N A L Fxams B A N K M E M O Pfwtiw car—nan cc: Toarr barnxs Date: 1 July, 1992 Discussed with Mari* Xavanagh tha idea of m a k i n g t h a f i r s t p i c k u p t i m e a t 10.30 ( ins tead o f 12.00). T h i s w o u l d a l l o w m t o r a c e i v e A n s b a c h e r c h e q u e s ( requested t h o nicest bef"▼‘ a )b e f o r e c o l l e c t i o n t i a e a t 1 1 .0 0 . T h i s h a s b o o n a a n t i o n a d t o P a u l a in P a y a a n t s artf «*h* i s a l s o <» . » xvnsts I n i t i t a l l y r e q u e s t e d o n 30/4/91. F a x i nclud es w a a k l y a t a t a a a n t p l u s a o e r u a d inta r a a t (to Wadnes day) a n d i n t a r a a t a a m a d (but n o t app liad) overnight, t o t hursday. Saa M o l d Corbatt faxes out raporta of our t e l e x e s o n T h u r a d a y a f t e r n o o n t o Australia, r a x 3 p a g e s o n c e p e r weak: EBQHSLS&Ufij U s u a l l y 1 o r 2 p e r day, t h i s w o u l d a c c o u n t f o r ins t r u c t i o n s o n f i x e d d e p o s i t s , t r a n a f a r a etc. QPTOlBtt *• 1 p e r week, b r i n g i n g o v e r w e e k l y statenenta, . V a d v i c e s l i p a a n d c o n f i r m a t i o n s . So aatiaea in c l u d e c h e q u e s a s well. 7^ 0 *& A - S O M A N R BQMO ND, C O R P O R A T E SERVICES. A M m b tr e f A t JS tra j A m b ad ttr B o U n g i P LC U v d m t Banking C i P.O . Box M7, Grend Cagm aa, British W o t fin Phanc (805) 949-465: P le a a e re p ly to : 42 FftzwQliamSquare, Dublin 2. TatacCPC F u s (S09) 949-7S (®9J 94M2 Tat 765144/763065 E a r 612035 29th August, 1990 M. David Humphries, Esq., Senior Manages - Operations, Guinness a Mahon Limited, 17 College Green, DOBLIH 2. i Dear David, . ' I think Ay visit vaster5-, Ima finally sorted out the '’ "tstasiJ.ng points in your letter of the 13th August. (a) z left with you copy Statement showing different value dates re A$200,000.. You will have adjusted. (b) D.P.C. Is opening a new A/A26 Sterling Account. Someone will ring Sam Field-Corbett or his Secretary, Mary, each Thursday morning giving a note of Interest accrued. (c) I went through with Martin the file, as a result, of which he is letting me have some documentation. (d) We agreed that you would eliminate "blocked account". ^ You will of course ensure that the various accounts remain effectively blocked. MSny thanks for your help. Yours sincerely. ■ £ .D . T ra v n o r. ’ . 11 HR. TXFTJa CORBET* WAS THICK FURTHER EXAMINED BY JUDGE 12 1O 0 1LE3.PT AS rCLLOWS: 14 15 JUDGE O ’LEARY: Mr. Field-Corbett, tell me 16 17 about the Diamond trust? A. The Diamond trust is a Cayman trust managed and 18 controlled in Cayman and, I understood, John Furze 19 and Des were the Trustees. 20 trust. 21 selling shares in Australia mainly. 22 involved were 23 They were the three involved. 24 involvement before Des died. 25 important to me after Des died and the reason was 26 that it required attention. 27 situations that I had a lot of activity on. 28 reason was that it needed day-to-day attention and 29 P&draig was not able to give it because he was It is a discretionary It involved quite a lot of buying and The people Rcr. Woss , John Farz**. 65 I had not much It only became It is one of the The 1 2 w o r k i n g a n d t h a t ' s w h y I g ot i n v o l v e d in it. 341 Q. I w o n d e r Mr. F i e l d - C o r b e t t , w o u l d y o u t h i n k a g a i n 3 and we will consider that answer about whether you 4 h a d a n involvemen t , a s i g n i f i c a n t i n v o l v e m e n t w i t h 5 t h i s T r u s t p r i o r t o Mr. T r a y n o r ' s death. 6 7 342 8 9 343 10 11 344 A. T h e D i a m o n d trust. ' Q. Yes, t h e D i a m o n d t r u s t h a d accounts, h a d t h e y ? A. A b a n k account, yes. Q. W h a t w a s it? A. A/ A 2 6 . Q. Y o u ar e s a y i n g t h a t u p t o t h e t i m e Mr. T r a y n o r d i e d . 12 y o u h a d l i t t l e o r n o i n v o l v e m e n t w i t h that 13 operat i o n , 14 15 345 A. T h a t w o u l d b e m y r e c o l l e c t i o n , yes. Q. Mr. F i e l d Corbett, y o u a re n ot s u f f e r i n g f r o m a n y 16 d i s e a s e w h i c h w o u l d i m p a i r y o u r m e m o r y now, a r e y o u ? 17 18 is t h a t w h a t y o u are saying? 346 A. I d o n ' t know. Q. I c a n s a y to y o u s t r a i g h t o u t t h a t t h e r e c o r d s of 19 II B a r e l i t t e r e d w i t h r e f e r e n c e s t o y o u a n d t h i s 20 t r u s t p r i o r t o t h e d e a t h o f Mr. Traynor. 21 y o u got to s a y a b o u t that. 22 MR. 7 U L LAM: Perhaps, Chai r m a n , i f y o u 23 p u t t h e m to him. 24 J U D G E O'LEA R Y : No, I w i l l d o it in m y o w n 25 way. 26 29 Now, w h a t d o y o u s a y about.that, Mr. F i e l d C o r b e t t ? 27 28 What have 347 A. I c a n o n l y g i v e you m y rec o l l e c t i o n . Q. D i d y o u or d i d y o u n ot o n a w e e k l y b a s i s s e n d f a xes o n b e h a l f of t h a t c o m p a n y t o A u s t r a l i a ? 66 T T 1 2 348 3 4 349 5 6 350 7 8 351 Q. Yes? A. T h e y w e r e sent t o us as a conduit. Q. Di d yo u do it e v e r y w e e k ? A. M y s e c r e t a r y d i d it. Q. W h y d i d yo u no t t e l l m e t h a t ? A. I h a d f o r g o t t e n a b o u t it. Q. Mr. F i e l d - C o r b e t t , t h i s is a most, 1 mean, ’ I d o n ot w a n t to be h e r e at all, I w o u l d m u c h p r e f e r t o b e at 9 10 h o m e bu t w h y do y o u s a y y o u h a d n o i n v o l v e m e n t w h e n 11 e v e r y week... A. 12 13 14 w a s ail I did. 352 15 16 353 17 18 354 19 20 355 21 22 35 6 23 24 357 25 26 358 Q. W h o d i d y o u fax t h e m to? A. T o R o n W o s s in A u s t r a l i a . Q. Have you copies of those? A. No. Q. W h a t a d d r e s s w a s it? A. I d o not r e m e m b e r t h e address. Q. W h a t n u m b e r d i d y o u f a x it to? A. I w o u l d no t h a v e it off-hand. Q. C a n y o u get it f o r m e ? A. Yes. Q. W i l l y o u do that, p l e a s e ? A. Yes. Q. Now, Mr. F i e l d - C o r b e t t , w h o w e r e t he b e n e f i c i a l 27 28 I go t b a n k s t a t e m e n t s in, w e f a x e d t h e m o f f a n d t h a t o w n e r s of t h at? A. I d o n o t know. T h e o n l y p e o p l e that w e r e e v e r i n v o l v e d in t h a t a r e as follows: J o h n Furze, R o n 67 ¥ 1 Woss and 2 was the stockbroker. 3 he has, actually, told me it is not his and the only 4 fellow left is John Furze. 5 359 6 7 360 8 9 361 It was not John Furze? A. I do not know. Q. Was it Mr. Traynor's? A. Not to my knowledge. Q. Did you ever communicate directly with Mr. Furze 362 *1 O 363 A. On a few occasions, yes. Q When, before or after Mr. Traynor died? T.. Afte** Mr. Traynor died Q. Before that Mr. Furze was not involved at all as far 15 as you were concerned? 16 17 364 18 19 365 20 A. Yes, exactly. Q. Do you remember how you were first employed? A. T o d o what. Q. You tell me, employed by this trust? A. If you are going back to the bank statements Des would have asked me to do that. 21 22 366 23 24 367 25 Q. Did you get paid fo: it? A. I a m sure w e did. Q. Do you know how much you got paid? A. No, it was very menial. 26 27 • about this? 11 14 Ron Woss was the advisor and Q. 10 12 • To my knowledge The secretary used to do it. 368 28 369 Q. Did you ever meet Mr. Woss? A. Yes, I met him at the funeral. Q. Did you believe, based on your knowledge, that Mr. 68 Woss is the b e n e f i c i a l o wner? 1 2 3 370 4 5 371 6 7 372 A. I can say to you that he has t o l d m e he is not. Q. What abou t that o t h e r g e n t l e m a n ? A. C r aig C a r t e r was a stockbroker, Q. Mr. Furze? A. Possibly. Q. W h y w o u l d Mr. Fur z e be u s i n g I r e l a n d to get I do not know. 8 invo l v e d in b u y i n g a n d s e l l i n g s h ares in A u s t r a l i a . 9 That w o u l d not m a k e a n y sense? 10 11 373 12 13 374 A. I have o n l y c o n j e c t u r e on that point. Q. H ave you a n y knowledge, Mr. F i e l d - C o r b e t t ? A. No. Q. As to w h y a person, w h y Mr. Fur z e s h o u l d use this 14 c o n v o l u t e d Irish s y s t e m to get i n v o l v e d in 15 s p e c u l a t i o n in A u s t r a l i a ? 16 17 375 A. I have no i n f o r m a t i o n a b out that. Q. W o u l d you give Mr. F i e l d - C o r b e t t d o c u m e n t s n u m b e r 1 18 to 89, t h e w h o l e lot. 19 D O C U M E N T E D H A N D E D T O MR. F i e l d - C o r b e t t . 20 376 Q. The s e are a s ample of the documents. Now, looking 21 at the first d o c u m e n t is it fair to s t a y that t h i s 22 project, 23 b o t h t h r o u g h G u i n n e s s & M a h o n a n d IIB 24 25 377 Yes, it seems to be. Q. Were you i n v o l v e d at b o t h stages or o n l y at t h e IIB stage? 27 29 (Exhibit 22)? A. 26 28 this A u s t r a l i a n project, was c a r r i e d out 378 A. IIB stage. Q. W o u l d you l o o k at p a g e two A. Yes, th a t ' s a b o u t the statements. (Exhibit 23)? 1 379 Q. It is f r o m A n s b a c h e r to whom, G u i n n e s s & Mahon, n o t t o IIB ? 2 3 4 W o u l d y o u l o o k w h o it is from. 380 A. Yes, w e d i s c u s s e d t h a t earlier. Q. No, in the last s e r i e s o f q u e s t i o n s I a s k e d w e r e y o u 5 i n v o l v e d in t h i s at the G u i n n e s s & M a h o n s t a g e o r at 6 t h e IIB s t a g e a n d y o u s a i d t h e ’IIB stage. 7 d o c u m e n t n u m b e r t w o s h o w s y o u w e r e involved. A. 8 9 10 The T h a t w a s just a t r a n s f e r of t h e b a n k s t a t e m e n t s (Exhibit 2). 381 Q. T h a t o n the 1 5 t h o f F e b r u a r y 1990 y o u w e r e a s k e d o r 11 a g e n t l e m a n w a s a s k e d t o g i v e y o u a s t a t e m e n t of 12 account every Thursday? 1^ I have already gone PM r 14 p u r e l y the b a n k s t a t ements. 15 382 Q. point- T h a t w a s just I w i l l a s k y o u t h e s a m e q u e s t i o n as I a s k e d o f y o u 16 in t h e b e g i n n i n g . 17 at t h e G u i n n e s s & M a h o n sta g e o r t h e I IB s t a g e ? 18 A. 19 20 383 384 23 24 W e sent b a n k s t a t e m e n t s in the G u i n n e s s & M a h o n stage. 21 22 W e r e you i n v o l v e d in t h i s p r o j e c t 385 Q. W h a t a b o u t in t h e IIB stage? A. W e w o u l d h a v e sent b a n k s t a t e m e n t s as well. Q. Y o u w e r e i n v o l v e d in b o t h ? A. Yes, at t h a t level. Q. W e k n o w that f r o m t h e 15th of F e b r u a r y 1990 r i g h t u p 25 to t h e e n d o f t h e v e n t u r e a f t e r t h e d e a t h o f Mr. 26 Traynor, up as far as 1996, for o v e r 6 y e a r s y ou 27 w e r e i n v o l v e d in t h i s if o n l y s e n d i n g o n w e e k l y 28 statements? 29 A. Yes. 70 n 1 386 2 Q. H a v e you no idea w h o the b e n e f i c i a l o w n e r is? A. I have just gone thr o u g h that w i t h you. 3 p e o p l e I have sp o k e n to or h ad a n y d i s c u s s i o n s w i t h 4 were, obviously, Des, John Furze, a n d the two 5 Australians. 6 387 7 Q. What di d Mr. T r a y n o r tell you? • A. Mr. T r a y n o r w o u l d n ' t tell you a n y t h i n g u n l e s s you 8 ^ n e e d e d to know. 9 11 O b v i o u s l y in the G u i n n e s s & M a h o n stage he said, send t h e m a round to Sam. 10 Sam, send t h e m off to W o s s a n d that is w h a t I did. 388 Q. If you look at p a g e n u m b e r 6 (Exhibit 24). The page 12 n u m bers are d o w n at the b o t t o m r i g h t - h a n d corner, 13 Mr. f i e l d - C o r b e t t . Do you see the b o t t o m r i g h t - h a n d 14 corner? 15 16 /»*v The only 389 A. I see that. Q. Now, that is a p a y m e n t into the account o f Mr. 17 Traynor. 18 b e n e f i c i a r y of this? 19 A. 20 390 Q. Is it p o s s i b l e that Mr. T r a y n o r was a How can I t e l l y ou w h e n I do. not know. It is like this, Mr. Field-Corbett, I have b e e n in 21 busi n e s s a long t i m e m y s e l f and I know that w h e n you 22 are d e a l i n g w i t h a p r o j e c t over a long p e r i o d of 23 time you a c q u i r e cer t a i n knowledge which, literally, 24 n o b o d y tells you b ut y ou p i c k it u p f r o m 25 conversations. 26 after. 27 u n d e r s t a n d that a n d I have to treat it a c c o r d i n g l y 28 but you cannot deal w i t h an account like this audit 29 for 6 years w i t h o u t p i c k i n g up some i n f o r m a t i o n That is the kind o f know l e d g e I a m I know it is imperfect knowledge, I about it? 1 A. 2 The initial activity was very small. My staff 3 members, m y secretary did it, sent it off. 4 after Des's death that we only really got involved. 5 391 Q. You see at page 14 (Exhibit 25). "DPC is opening a new A/A26*Sterling Account. Somebody will ring Sam Field-Corbett or his Secretary, Mary, each Thursday morning giving a note of interest accrued.” 6 7 8 9 392 Q. Who is Mary? A. My ex-secretary. 10 11 393 Q. What is her name? 12 394 Q 13 395 Q. Where does she live? 14 15 396 Q. Do you have her address? A. Off-hand, no. 397 18 Q. Do you know where she is working now? A. 19 20 398 399 23 24 25 26 27 I do not think she works. I think she got married and stayed at home. 21 22 Simpson? A. Somewhere in Beaumont. 16 17 It was 400 Q. What is her married name? A. I do not know, I can get it for you. Q. Would you do that? A. Yes. Q. Thank you. If you would look at page 16 (Exhibit 26) : "A/A26. The weekly application of interest on 13154173 account has been reverted to monthly. As agreed, we will now phone advise Sam Field-Corbett every Thursday morning with the interest accrued figure on the following account." 72 1 2 401 A. It is the same thing. Q. Then page 18 (Exhibit 27), a payment of A$4,200 to 3 John Desmond Traynor. Do you know anything about 4 that? 5 6 402 A. No. Q. When did they start faxing you* rather than phoning you with the information? 7 A. 8 9 10 interest accrued. 403 Q. 12 404 A. I wouldn't have an idea. Q. If you look at page 20 (Exhibit 28) it might assist 14 you in that regard? 15 16 405 A. That's when they started faxing me. Q. Again, all this, everything we have done so far is 17 in the Guinness & Mahon stage? 18 19 When did they start faxing you that information rather than phoning you? 11 13 I think what they are doing there is giving the 406 A. That is right. Q. Notwithstanding the fact that the first thing that 20 you told me was it was only IIB. How much did they 21 pay, Mr. Field-Corbett, for this service? 22 23 407 24 25 408 26 27 28 29 409 A. A couple of hundred dollars. Q. A couple of hundred dollars when, a month or a week? A. No, not a week. Q. A month? A. A month. Q. Would it be $750 a month? A. I don't think so, no, maybe, maybe. about 10 years ago. 73 You are talking Do you remember a small fee of n 1 2 $750 10 years ago? 410 3 4 411 Q. You do not know in other words? A. I don't know. Q. Now, if you look at page 32 (Exhibit 29). 5 This is an internal IIB document which says under FAXES: 6 "Initially requested on 30/4/91. Fax includes weekly statement plus accrued interest (to Wednesday) and interest earned (but not applied) overnight, to Thursday. Sam Field-Corbett faxes out reports of our telexes on Thursday afternoon to Australia. Fax 3 pages once per week." 7 8 9 10 11 412 12 13 413 14 15 414 Q. Is that accurate? A. It is there. Q. Is A. Yes, but that is just confirming what we were doing. Q. Is that an accurate description of what occurred. 16 415 19 20 416 A. Yes. Q. It is accurate? A. Yes. Q. According to that it was reports of the telexes you 21 were faxing out rather than telexes themselves? 22 23 accurate, is that what was happening? Take as long as you want to consider that? 17 18 i: 417 A. No, they are the bank statements. Q. Mr. Field-Corbett, I asked you to look at it, to 24 look at it carefully and what it says is, and you 25 confirmed having looked at it carefully that Sam 26 Field-Corbett faxes out reports of our telexes on 27 Thursday. 28 29 418 You used to write a report to them? A. Not at that stage. Q. Did you later? 1 2 419 3 A. Yes. Q. When? A. We just wrote out the bank statement, I d o n ’ t recall 4 the time. 5 are incredible. 6 420 7 Q. Did you write out any comment on it? A. We would only have been writing what went through 8 9 You are asking me to recall things that the bank statements. 421 Q. If you look at page 36 (Exhibit 30). This is an 10 internal IIB document and that is what they were 11 supposed to do. 12 accounts interest applied weekly and then if you 13 louk at page 36, again, the weekly standing order 14 was every Thursday this had to be done, this A/A26. 15 Now, do you remember being instructed to send out 16 this A/A26 statements on a weekly basis? 17 18 422 19 20 423 A. No. Q. Do you know who instructed you to do it? A. I assume it was Des. Q. Was that an assumption or what you, actually, 21 remember? 22 23 424 24 25 425 26 A. It is an assumption. Q. Could it have been Mr. Woss for example? A. It is possible. Q. Could it have been Mr. Furze? A. No, not at that stage. 27 28 29 If you look down under lb A/A26 Mr. Furze did not take over the thing until Des died. 426 Q. If look at page 48 (Exhibit 31). This, again, was during a period of time when Mr. Traynor was still 1 alive. Carnmore Holdings, do you know anything about 2 that company? 3 A. 4 5 a payment to us. 427 Q. 6 428 Yes, correct. Q. I am not interested in that. 429 A. Yes. Q. This is after Mr. Traynor died but it was done by 12 • Williams. 13 This $295,000, do you know anything aLwut that payment? 14 430 A. No. Q. That was before you started organising them, would 16 17 that be a fair point? A. 18 That to me is correct. MS. MACKEY: Who would have instructed 19 Ms. Williams to do that, 20 21 22 Now, would you look at the next page, page 49 (Exhibit 32)? 10 15 ' A. 9 11 If you like that was a flag of convenience to pay your fees? 7 8 I think it was an account we used. That was probably Mr. Field-Corbett. A. That would have been either John Furze or Ron Woss, one of them or even PSdraig, I don't actually know. A p p e n d ix X V (1 4 2 ) M r D o u g la s A r m s tr o n g 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r Douglas Armstrong. a) Transcript of evidence of M r Douglas Armstrong dated 31 January 2001. b) Letter of 15 December 2000 to Inspectors from Douglas Armstrong. c) Statement o f Douglas Armstrong of 15 December 2000. d) Letter from Michael Pender to BA Ursell of 24 December 1986. e) Internal Guinness and Mahon memo of 14 June 1991. f) Guinness and Mahon Credit Committee Minute o f 13 May 1977. g) Guinness and Mahon Credit Committee Minute of 14 December 1977. h) Guinness and Mahon Credit Committee Minute - loan extension to 20 September 1986. i) Guinness and Mahon Credit Memo of 30 September 1985. j) Guinness and Mahon Credit Committee Minute o f 5 November 1986. k) Guinness and Mahon Credit Committee Minute of 1 June 1988. 1) Guinness and Mahon Credit Committee Application of 25 April 1990. m) Companies Registration Office return - Armstrong Electronics Ltd. MR. DOUGLAS ARMSTRONG UNDER OATH WEDNESDAY, 31ST JANUARY 2001 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer THE INSPECTORS: MR. MICHAEL CUSH S.C. JUDGE SEAN O'LEARY SOLICITOR TO THE INSPECTORS: MS. M. CUMMINS INTERVIEWEE: MR. DOUGLAS ARMSTRONG 1 2 3 4 MR. CUSH: 5 Mr. Armstrong, for the record I am one of the 6 Inspectors to Ansbacher. 7 O'Leary, he is another Inspector. 8 going to ask you some questions and if there are any 9 questions after that, Judge O'Leary will ask them. This is Judge Sean This morning I am 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 If you would not mind taking the oath to begin with. 1 2 3 4 1 Q. MR. CUSH: Mr. Armstrong, we have 5 your statement, Exhibit 1, 6 thank you very much for that, and the documents that 7 you sent in with it. 8 understand your business to have been and if I am 9 wrong, then you can correct me. I will just tell you what I You are the 10 Principal of a number of companies, one of which is 11 Armstrong Electronics Limited, another of which is 12 Armstrong Space Communications and another of which 13 is Wilfield Securities Limited; is that right? 14 A. 15 2 Q. 16 Correct. These are companies which in general terms operate in the electronics business? 17 A. 18 3 Q. Correct. I think maybe you began with TV rental and moved on 19 to importation of TVs and then electronic equipment 20 generally and satellite information systems for 21 bookmakers and the like? 22 A. 23 4 Q. 24 25 28 29 Was the principal trading company Armstrong Electronics ? A. 26 27 That's correct. It was, but in the early days Armstrong Electrical was, which was disposed of in the early 1980's. 5 Q. I think maybe more recently you expanded activities into Europe, is that right? 1 and we now are running a service for exporting 2 products out of Ireland direct to customers in 3 Europe. 4 6 Q 5 You are using a Jersey based company for your non-Irish activities, is that right? 6 A 7 7 Q Not at the moment, no. We did at one time. You did at one time, okay. Mr. Jack Stakelum is a 8 man you have probably known for many years now, is 9 that so? 10 A 11 8 Q 12 A Correct, yes. Did you know him first from his Haughey Boland days? Yes, I think I probably met him when I moved to 13 Haughey Boland. 14 certainly when the audit was done, you went and 15 discussed your accounts and your financial situation 16 with him and got to know him quite well because at 17 that time I was -- well, dare I say in financial 18 difficulties. 19 9 Q 20 Was that your first contact with him, through Haughey Boland? 21 A 22 10 Q 23 Yes . When he left Haughey Boland, I think you maintained a business relationship with him? 24 A 25 11 Q 26 A 27 12 Q Yes . He in fact became a Director? He became a Director of the company, yes. Did he furnish financial advice generally to the company then? 28 29 I think he was a partner or A 1 13 Q 2 A 3 14 Q 4 A Yes . Did you know Mr. Traynor? I met Mr. Traynor on a few occasions in the bank. 5 He actually became a customer, he rented televisions 6 from me. 7 him and I think I had a cup of tea with him. 8 15 Q 9 When you say you met him in the bank, that would have been some time in the 1970's, is that right, or 10 11 In fact I was in his house once when I met later? A I didn't have much contact with him and you never 12 met him for long. 13 think I wasn't a player that he dealt with normally 14 or the level of player he dealt with, so it was in, 15 out and gone. 16 four times. 17 16 Q MR. O'LEARY: 18 19 He was in and out and gone and I I would have met him two, three or Was he in Guinness & Mahon at that time? A Yes, but he continued to be a customer who I 20 wouldn't have dealt with in the subsequent years 21 when we were renting televisions up to some time in 22 the 1980's when we stopped. 23 17 Q 24 Speaking about Guinness & 25 26 MR. CUSH: had some dealings with them in 1972; is that right? A You can probably check the exact date, but it was 27 about a month after GEC in Dunleer went bankrupt. 28 You may remember them, they were Telefunken 29 distributors and used to make washing machines and Mahon, I think you 1 2 18 Q. 3 4 You thought it would have been around that ...(INTERJECTION)? A. I tried to get the Telefunken agency and I needed 5 funding. 6 opposite Battersbys, it used to be Battersbys and 7 there is a hotel there now, Investment Trust or 8 National Investment Trust or somebody and they used 9 to block discount my television rentals. I already had funding from a place down They also 10 had money from Bank of Ireland, they are now in 11 Ballsbridge. 12 Ireland finance eventually, but we were trying to 13 get money to import the televisions because the 14 Germans would not give credit. 15 I had already been getting money from. 16 another company, a company belonging to Pye in South 17 William Street. 18 name of it, but it was a Pye subsidiary anyway and 19 we were buying Pye televisions but you could only 20 get finance on Pye televisions through them. 21 independent finance to bring sets in from Germany I 22 tried the usual, the three main banks which was no 23 go, Jack Stakelum and I am sure he arranged it, I 24 don't know who arranged it but whoever arranged it, 25 and I tried to get money from Guinness & Mahon but 26 didn't succeed at that time. 27 that stage and I thought I was getting it and then 28 they pulled out. 29 19 Q. Anyway, it turned to be Bank of I approached people There was Credit Finance might have been the To get I met Des Traynor at Was that your first meeting with Des Traynor? 1 2 20 Q 3 A 4 21 Q Around that time, yes. I think you did eventually in fact have dealings, 5 successful dealings if you like with Guinness & 6 Mahon in 1974? 7 A 8 22 Q 9 10 That's correct, yes. From that time on then you had a variety of facilities ? A Yes, I have always paid my bills, I paid on time and 11 if I was behind I would ring him and say, 12 can't pay you until next week' and that seemed to 13 work. 14 23 Q Mr. Stakelum seemed to be the man who dealt largely on your behalf? 15 16 A Yes. Being honest, he was the professional to make 17 a bank application, not me. 18 professional today if I was looking for an 19 application. 20 24 Q 21 22 I would still use a Was it he who advised you to approach Guinness & Mahon in the first instance? A 23 24 'listen, I I am sure it was. was. 25 Q I don't recall, but I am sure it I wouldn't have known him otherwise. We have some documentation from yourself, 25 Mr. Armstrong, in relation to your dealings with 26 Guinness & Mahon and then we have other documents as 27 well in relation to your dealings with Guinness & 28 Mahon. 29 are references to your various facilities being Throughout the documents that we have there 1 "suitably secured". 2 understand to mean that the facilities are secured 3 by cash deposit usually held offshore. 4 position in your case? 5 A. Absolutely, That is a term which we I didn't have a bean. Is that the In fact, some 6 time in 1976 or 1977 there was a personal audit done 7 by Jack Stakelum on me, and he reckoned my total 8 assets taking everything into consideration was 9 something like £3,500, impossible. 10 26 Q. Is it the case then that you are telling us clearly 11 that you did not at any stage, either you or your 12 companies have a cash deposit? 13 A. Actually my late wife, and only when the documents 14 came -- we had been burgled three times at home 15 including the last time when we were cleaned out in 16 the early 1980's, so no money was kept at home at 17 all. 18 holidays or changing her car. 19 surprise, she had a deposit account for, I think, 20 £1,500 and I made reference to it in my statement, 21 Exhibit 1. 22 MR. O'LEARY: My late wife was great at saving her money for In fact I never knew she had it. 23 £1,000 . A. That was the amount. MR. O'LEARY: 26 27 A. 28 27 Q. 29 We do not have the slightest interest in 24 25 In fact to my You can ignore that. You asked me for a full and frank statement. MR. CUSH: We have no difficulty with 1 would be anxious to be absolutely clear about this, 2 your evidence is that at no time did you or your 3 companies hold a cash deposit in the Channel 4 Islands? 5 A. 6 No, not in the Channel Islands but we did put money on short-term deposit when we had cash available. 7 28 Q. 8 A. 9 Where would you have banked that? All in College Green and it would have been taken out maybe a week later. There was one time you were 10 getting something crazy like 36% overnight or 11 something like that. 12 29 Q. MR. O'LEARY: indicating in his question 13 14 15 that your company did not have a deposit either? A. 16 17 I think Mr. Cush is also My company would have put the money in short-term deposit. 30 Q. 18 Neither you or your company had money on deposit abroad? 19 A. 20 31 Q. 21 A. 22 32 Q. No, not abroad, no. Is that true? That is true, yes MR. CUSH: 23 Is it the case, Mr. Armstrong, that 24 somebody else or some other company may have been 25 allowing you avail of a cash deposit as security? 26 A. 27 33 Q. I didn't have it. Did Mr. Stakelum ever say anything to you about 28 there being cash deposits which might secure your 29 facilities with Guinness & Mahon? 1 2 anything for me was when I had a row with the Ulster 3 Bank here in Blackrock and I moved to AIB, he signed 4 a guarantee with me in AIB. 5 the early 1980's because they would not give me the 6 facility I needed and he signed the guarantee with 7 me in the 1980's. 8 aware of. 9 a year ago and he says he does not even recall it, That was some time in That is the only guarantee I am I actually mentioned that to him probably 10 but I know he did because when I got the guarantees 11 back, because I don't have a personal guarantee with 12 AIB anymore, when we were sufficiently in the black 13 or sufficiently solvent, I asked for my guarantees 14 back when I moved branch. 15 34 Q. Okay. If there are documents which make reference 16 to your companies and to yourself and your late wife 17 and they have the description "suitably secured", 18 you are not in a position to throw any light on 19 that? 20 A. In 1974 was the first time I got a loan. My late 21 wife had to sign a guarantee, 22 guarantee and they took debentures on my two 23 companies. 24 something like £600 or £700 and I eventually had to 25 pay that, I didn't think I would have to pay that 26 but I did pay it. 27 28 29 35 Q. MR. O'LEARY: I had to sign a At the time there were legal fees of I think in fairness to you, Mr. Armstrong, I should point out to you that the way in which the 1 system worked in Guinness & Mahon was that people 2 who borrowed money, and sometimes it was an ordinary 3 transaction, but people who borrowed money for 4 genuine reasons, if they had money offshore they 5 were reported within the bank as having adequate 6 security or suitable security. 7 that they did not also have to sign a personal 8 guarantee, do you understand? 9 of people who gave mortgages on their property, who That did not mean So we have many cases 10 gave personal guarantees but also had money 11 offshore. 12 I'll tell you one thing, I didn't have money, I 13 didn't have the money. 14 if I had it, I wouldn't have had to go to them. 15 36 Q 16 It would be a nice problem Does the word "College Trustees" mean anything to you? 17 A 18 37 Q No. MR. CUSH: 19 Mr. Stakelum never spoke to you about College 20 Trustees ? 21 No, never heard of them. 22 anybody else's business or even his own. 23 when I cribbed about his charges, he always said 24 look, the cost of running a business was such and 25 they were the charges at that time. 26 a severe disagreement in the mid 1990's over 27 charges. 28 29 In fact he never discussed In fact In fact we had 1 2 something among ourselves 3 and we will be back to you. 4 5 6 (SHORT ADJOURNMENT) 7 8 MR. CUSH: I just want to go back a 9 little bit, Mr. Armstrong, 10 if we may. 11 described you as the Principal, are you in fact the 12 Principal of all of those companies. 13 A. 14 38 Q. 15 16 In relation to the companies of which I Yes. You are the beneficial owner really of those companies ? A. Well, 10% is owned by one of my directors and the 17 rest is owned by me. 18 which I didn't list there, Websat, which when it was 19 founded my children became shareholders and I'm a 20 shareholder. 21 39 Q. 22 A. 23 24 40 Q. Wilfield is 100% owned by me, maybe 99% and 1%, I Is Mr. Stakelum the 10% owner to which you referred to? 26 A. 27 41 Q. 29 What about Wilfield Securities? don't know. 25 28 Now, there is another company No. Moving then to your Guinness & Mahon dealings, who did you deal with in the bank? 1 2 42 Q. 3 A. 4 43 Q. 5 A. Yes, Mr. McLoughlin. Did you deal with Mr. O'Dwyer? Yes, I think so. Anybody else you can recall? I always remember that when you rang the phone, the 6 lady that answered the phone had an incredible 7 accent on the phone. 8 44 Q. 9 A. 10 11 45 Q. Of course, and Mr. Stakelum had dealings on your behalf? A. 14 15 I wouldn't say I had dealings, I didn't have to other than on the business transactions. 12 13 You had dealings with personnel in the bank? The only time I would have dealings was when I ran into trouble with interest overdue. 46 Q. If you needed an extension of a facility which you 16 did from year to year, Mr. Stakelum would meet with 17 the bank? 18 A. 19 47 Q. 20 A. 21 48 Q. 22 Yes, he would normally deal with that, yes. He would update them on the affairs of the company? On the staff of the company, that's right, yes. He would apply for and post 1974 he got an extension of the facility, is that not so? 23 A. 24 49 Q. 25 A. Yes. Were you part of those meetings with the bank? I probably was in the bank -- well, I would go to 26 the counter occasionally. 27 other people would be in a lot more often than me, 28 staff would be picking up drafts, dropping off 29 drafts, dropping off letters of credit. When I say occasionally, I remember 1 that day you could park nearly outside the front 2 door and get away with it for a couple of minutes. 3 Mr. Armstrong, 4 secured" designation. 5 we know and we have been told that that description 6 "suitably secured" means that the loan is backed or 7 secured by a cash deposit elsewhere. 8 understand now ...(INTERJECTION)? 9 A 10 51 Q I want to return to the "suitably I want you to understand that Do you Yes, I understand. How much we do know. I want to show you some 11 documents which are Guinness & Mahon documents which 12 describe your companies' facilities as being 13 suitably secured. 14 document that begins at page 68 of our book. 15 HANDED TO MR. ARMSTRONG). 16 there, Mr. Armstrong, is largely blacked out because 17 the full copy refers to another person. 18 Guinness & Mahon document, do you follow me, 19 Exhibit 2? 20 A 21 52 Q I will begin, if I may, with the The document you have This is a Yes . Do you see there that it begins with: 22 "Bruce 23 As requested, I list hereunder particulars of the accounts for which we are holding backing deposits from Guinness Mahon Cayman Trust." 24 (SAME 25 26 27 Do you see that? A Yes . 28 Then there are some paragraphs and then A, B, C and 29 then sub-paragraph D which you will see: 1 "College Trustee clients have arranged backing deposits here through GMCT." 2 3 Do you see that? 4 A. 5 54 Q. 6 Yes I see it, yes. Then you see the reference further down there to Armstrong Electronics? 7 A. 8 55 Q. 9 Yes, I see it there. There are a number of other documents with similar information not limited to Armstrong Electronics but 10 referring also to Wilfield Securities and also to 11 Armstrong Space, that is another of your companies? 12 A. 13 14 Space was a name, it would have been Gemini originally. 56 Q. Mr. Armstrong, those are statements emanating from 15 the bank to the effect that your companies' 16 facilities are suitably secured? 17 A. 18 57 Q. Well, I had no money. Be very careful now, are you saying that you 19 personally had no money that was acting as a cash 20 security? 21 A. 22 58 Q. 23 Are you saying that none of your companies ...(INTERJECTION)? 24 A. 25 59 Q. 26 No. Are you also telling the Inspectors that no other person of whom you are aware? 27 A. 28 60 Q. 29 Yes, absolutely. No other person of whom I am aware. By that do you mean to say that you may not know the 1 2 There is nobody I know that has told me they have 3 guaranteed it or there is nobody I asked to 4 guarantee it. 5 Mr. Armstrong, have you some inkling that somebody 6 was providing cash? 7 A Put it this way; it was arranged by Jack Stakelum, I 8 certainly asked him because that point was mentioned 9 to me by somebody else and I certainly didn't 10 guarantee it. 11 guaranteeing it either. 12 I can't say if Joe Bloggs down the street walked in 13 and guaranteed it, I don't know about it. 14 62 Q 15 16 He said I have no recollection of Therefore, I don't know and You say this point was raised by somebody else, who do you mean? A Originally, this is not the first Tribunal I have 17 gone to, the very first one was down in the Castle 18 and they raised the same issue and it came up in 19 discussion then. 20 raising today. 21 63 Q 22 23 The same issue arose as you are It was discussed at that time. You discussed it then with Mr. Stakelum at that time? A Yes, probably at that time and he said I have no 24 recollection, he says, 25 it' as far as I recall but he didn't say 'yes' or 26 'no '. 27 Do you understand that we are not speaking about 28 guarantees, we are speaking about a cash deposit? 29 There is no question of that in my case. 'I certainly didn't guarantee I know 1 nobody that I ever asked or had the money or had 2 control of the money to deposit. 3 If I had it, I probably would have been looking for 4 the money. 5 MR. O'LEARY: I didn't have it. There is another document 6 which Mr. Cush is going to 7 put to you. 8 because it deals exclusively with your company. 9 (SAME HANDED TO MR. ARMSTRONG). It is a better document in some ways Apparently it is a 10 1991 document and apparently it is a GMI document 11 which was included in the authorised officer's 12 report into Ansbacher. 13 following on from what the authorised officer has 14 done and he found this document and he included it 15 in his report, Exhibit 3. 16 MR. CUSH: 17 18 If you like, we are If you just read it through, Mr. Armstrong. A. Who is CAW? MR. O'LEARY: 19 I presume, Mr. Armstrong, 20 it would be better if you 21 told us who CAW is because you were at the meeting, 22 I was not at the meeting at all. 23 A. 24 65 Q. 25 I don't recall. This is not a 1974 document at all, this is a 1991 document. 26 A. 27 66 Q. Okay, 1991. MR. CUSH: That is a document, 28 Exhibit 3, recording what 29 you were telling the officials of the bank, is that 1 2 3 67 Q. 4 healthy trading situation for the company? 5 A. 6 68 Q. 7 Yes, yes. "Fairly liquid" I think was the description you used? 8 A. 9 69 Q. 10 Yes. There is mention also of £230,000 being held on short-term deposit with AIB, is that not so? 11 A. 12 70 Q. 13 14 You are describing there, are you not, a reasonably Yes. Therefore there was cash available to the company at that time? A. Now, one of the things that you must bear in mind is 15 up to 1987 it was a very tough market and we were 16 fortunate to get into the satellite business. 17 got a major contract with SIS which we made huge 18 profits on, every betting shop in the country. 19 was the first good year we ever had and from that 20 time forward we did extremely well. 21 71 Q. 22 A. 23 72 Q. 24 A. 25 73 Q. 27 A. 28 74 Q. 29 1998 So from 1998 you made huge profit? Sorry, 1988. You made a huge profit? Well, not huge, but certainly in hindsight we were way ahead of anything we ever made. 26 We You did well from there on in? Yes. You had cash on deposit? 1 75 Q. 2 deposits ? 3 A. 4 7 6 Q. 5 A. 6 7 The bank were expressing a willingness to quote for 77 Q . A. Yes. Did you put money on deposit with the bank? With Guinness & Mahon? Yes. No, I don't think we did at that time. It was only 8 when, and you can tell me when better than I can, 9 when there was a financial crisis and interest rates 10 went crazy overnight, 11 mid 1980's or whenever it was. 12 78 Q. Did you put money at this time on deposit in the bank? 13 14 A. 15 7 9 Q. I don't think so. MR. O'LEARY: 16 Who did you buy your Mr. Armstrong? A. 19 20 No, I don't think so. supplies abroad from, 17 18 I think that was the Supplies were bought in Taiwan, the States, Korea and all sorts of different places. 80 Q. Did you do what a lot of businessmen did at that 21 time which was that they arranged that the invoices 22 would be routed through an offshore entity? 23 A. 24 81 Q. 25 A. 26 82 Q. 27 A. 28 83 Q. 29 No, never did. You never did that? No. So that you could leave money there? No. Mr. Armstrong, could I explain something to you 1 2 3 84 Q. We are not in control of our report. We are not 4 independent operators. 5 Court and we do not know, nor can we give any 6 guarantee to anyone who comes in here of what will 7 happen to our report. 8 nobody do anything about it or it could be plastered 9 all over the newspapers. We are appointed by the High It might lie on a shelf and We do not know, it will 10 not be a matter within our control. 11 understand that? 12 A. 13 85 Q. 14 A. 15 86 Q. 16 A. 17 18 87 Q. Do you Yes. You said to me that you were interviewed by CAB? By? You said CAB, was it? No, in the first Tribunal. MR. CUSH: The Castle. MR. O'LEARY: All right, I understood 19 you said it was CAB. 20 A. 21 88 Q. 22 A. 23 89 Q. No, no. It was up in the Castle? Yes, the Castle, that's right. If our report is published, and I want to make it 24 quite clear we have no control over it and I can 25 assure you it will not decided on what you say, 26 there will be much bigger fish which will decide 27 that. 28 A. 29 90 Q. I gathered that. Ultimately somebody in the High Court or the 1 Minister or both or a combination of both will 2 decide this is a report which should be published or 3 this is a report which will not be published. 4 were to report in that report that you gave us sworn 5 evidence that you had no interest in or knowledge of 6 any money held offshore during that period of time 7 which was used to secure your loans, would you be 8 happy to stand over that in public? 9 A 10 91 Q 11 If we Yes . And it will not cause any embarrassment to you anywhere? 12 A 13 92 Q 14 A 15 93 Q Yes . Do you understand what I am saying now? I understand what you are saying. MR. CUSH: Mr. Armstrong, 16 so far as you are concerned, the 17 various references in the bank documentation to your 18 companies' loans being "suitably secured", they must 19 be a mistake; is that so? 20 A Put it this way; I can't comment as to what reason 21 they put it there. 22 other than that. 23 fairy godmother out there that I am not aware of, 24 great. 25 MR. O'LEARY: 26 I have no grounds to suspect If there are any or if there is a Would you look at page 57 so as nobody is under any 27 misapprehension. 28 This is a 1977 document, Exhibit 4. 29 (SAME HANDED TO MR. ARMSTRONG). 1 95 Q. 2 A. 3 96 Q. It deals with your company, does it not? Yes. It said you had a £20,000 loan for trading purposes, 4 there was a rate of 15% per annum and it was 5 suitably secured. 6 A. 7 8 97 Q. We do not know. They are your loans, they are not our loans. A. 11 12 Money taken from loan account, that is the way I took it, was it? 9 10 Yes. To be honest with you, in 1977 I can't tell you what the £15,000 was taken for or the £20,000. 98 Q. 13 Number 58 is a loan. MR. ARMSTRONG). 14 A. 15 99 Q. 16 A. 17 100 Q. 18 A. (SAME HANDED TO Wilfield Securities, Exhibit 5? Yes. Again it is 1977 and suitably secured. It wasn't secured by my money anyway. Was it secured by any money that you know of? Not that I know of. If it was, it was, but it 19 certainly wasn't by me or anything I had or any 20 company I had or anybody abroad. 21 101 Q. 22 A. 23 102 Q. 24 A. 25 103 Q. 26 A. 27 104 Q. 28 A. 29 105 Q. Had you any dealings with Jersey? No. Guernsey? No. Cayman Islands? No. College Trustees? No. Did you ever have a trust? 1 2 106 Q 3 A 4 107 Q In 1997. Where was that trust? Isle of Man. MR. CUSH: What is the name of the 5 Jersey based company that 6 you began your Polish operation with? 7 A 8 108 Q 9 A 10 109 Q 11 A 12 Enterprise Trading, it wasn't my company. What was the name of the company? Enterprise Trading, it wasn't my company. MR. O'LEARY: Whose company was it? Jack Stakelum's company. MR. CUSH: Thank you, Mr. Armstrong. 13 We may have to talk to you 14 again if we have any further queries but we will be 15 in touch. 16 MR. O'LEARY: Thank you for coming along. 17 There is one other matter, the transcript will be 18 available and you will be asked to sign it, so as 19 everybody will know exactly what you said and so 20 nobody will be able to say you said more than that 21 or you said less than that in the future. 22 Thank you. 23 MR. CUSH: 24 25 26 27 28 29 END OF INTERVIEW Thank you. (rfi'uL fJtfi CL>tL c b ~ o C-A^, / ^puuA * & Cv / ^ v & -CS> &j O O»*o^ jrf £ /Jfc 0 J2-">v©-»_J Cl— <_ V /^v>kL CTU Cl» lw l«<-^?' i f f Cl~ ^& L . c£sL -cdk~ ^(i o -p c „ ^ ^ 2 ^V« ta-d-»-v f jr jp C-g d U i. 4^ ^ Z s tr v i^ C d * -J^ . I 3 m. $7 dweu A, @4044 @374?; m, m, @LcAa. m. MM, ?xm?rm? Bow/L (JawcrL Cra?aw 4:55 a? . 4,7. CW ?wz? Nara ?Mm Fry-'72. 13- ram 050- 01: 4w MM CXXQ M14]?sz ?1 or vac/{ml novqu (lanai 5% / 9 7 y- ^ ^ i ^ > (X ^ e l / ^ j , ^ j ^ C ( ii^^i' i3v^9 <2j^ ci. C -i^ x ,L~i c h * tf ^ ^>£^>-Ci. A, ~~]{urO C L-^cd, <-i. O ^ C t^ ^ J L ■^"t^!^. ’^JL-^yir &*'’ *xr&*j C^t-s^O^^uL^o t & c t z i j i Ot~^s\JL*m$„ ~k> ^ C^-t-^i-l, Ci-^ L-t^t_ C iuoL Qr^yj Z9m^ L ~^J~K> Ca-*~£ Q^r^UL^S /<*)-£-<.X- # z . /£^U ''9 £&/VJ ^'^SJL /yy\M ~«^ j l ' C? / L , ^ O u r v h ^ t' ^ ^ / $ it**yssrsJ^Yi S ^ as>.*JL£~**-L> 4/£ s u ^ , o£f jf°~ * - a ^ ! frvv ifj ^ P< *stA*~tS A^TK^ /^ C C m ^ X j^^L Ot-O V^A^-C^I^ ^.O sliL^s-^* ./f^& *^*-<- A-r*isO OcsCpL ^ ^ 'Ow ^ Cp£L%~4irL -C^~^-> / ^ {p 7 '££1^ ✓^«r*-*-j ^ 2 l» j s ^ A ye adequ ate. M inute.. ............... D ate. A . . '. . . I . ! . - . . . ! . . ? . . f t ? . . J) BOARD Total Exposure: £178,504 M inute : .3 « Date......... j i l i i M . '!A.ME: ARMSTRONG ELECTRONICS LIM ITED. Credit Mem orandum Subm itted b y : p o ' D ADDRESS: 3U SIN ESS/ O CCU PATIO N: c/0j j 7 t Clyde Road, Ballsbridge, Dublin 4. Equity Stake: No. C.B. Approval: T.V. Equipment Dealers. Yes/No Permission O btained Date: N/A THIS A P P L IC A T IO N : / Extension / Rs<&jfi*i#jjxx (Delete as appropriate) fY P E : .......... .V.*?.?.?.................................. AM O UNT: L^.t.ers.of.Credit....... * ..£53,45.0.. ......... , , .......... IR£1..00,.Q.QQ............. RATE: Base..+..2?/o............ F E E : ............... N .U ........ ......... -............ .........Usual If new or increased 5U R P O S E /D R A W D O W N : facilities, is draw dow n perm itted prior to orking capital facility, b f^swLJitate opening of Letters of Credit. com pletion o f security? YES / NO R E V IE W D A T E S : f E R M OF F A C IL IT IE S : {tension for one year 31.3.1989 SOURCE O F R E P A Y M E N T : ash flow from business. S E C U R ITY : If additional or existing )int & Several guarantee Douglas & Mrs. Elsie Armstrong. facility, is security in order? Y E S / MOX ebenture completed by Armstrong Electronics Limited. If No, give details separately. Dns. .ed adequate. BACKGROUND N O TE / O U T L IN E O F PRO PO SAL- . ** interest debited to the account during the year has been paid. The accoun r trie two years ended 30th June show a profit of £43,000. The company guaranteed a loan of £20,000 Gemini Electronics Lim ited - this has been fully repaid. A ll F/E business i.e. Letters of Credit/ Elections is routed through G & M. It is expected that reductions w ill be made during the year. :tension recommended. Related Facilities/Borrowers: C R E D IT C O M M IT T E E (Balance or L im it, whichever is greater) M i n u t e . . . . / . ^ . . k . . 6 . ............. D a te..... ....................................... .............. /& d ................. BOARD « ....... 7 9 3 ........ < a „ .................................... ?mad?: I V' ■> CREDIT COMMITTEE APPLICATION Units G.a M. Dublin Minute No: Date: '2B33929 COM PANIES REGISTRATION OFFICE Annual Ratum Companies Acta 1M3 to 1990 Saetlon 128 or 126, Companiaa Act .1963 Company Numbar. Ragtaintion Ilea stamp tobaaflhadatova B1 30137 Company Nama infull ARMSTRONG ELECTRONICS LIMITED •• temjaM* uimo biadt 'ttpfcateor 31 dayo( D ecem ber a(»)4 NONE Horoa Addfaaa 3 24 ST. MARGARETS AVE.BLACKBANKS. RAHENY._________________ i_____________________ QUBUN6. IRELANQ_________________________ Indabtedneaa Jn fc* c tt* cf in y p a n o n ,» h n w fo rw u m t of lu m im s »*»•#» mat tor*tam» or t u r n m m m cha n g e or «iui«4batarttn*9«tcn f>w rtx*erwtwetleir>edthe •g* ** *ym» *f h« taoo changed or * i u m 4 for • p*io4 of net to * than 20y«ar»: M l HMIW Cf MMrMUM br .N C hir^w M itfM A n pr»\iou« to ?wr marriage Fof»nama3 JOHN ToutmaunolladaMednaatetHacompanyInraaaaeta»a mortQogaaandcaaigsi «Nckanrayiiiratfa bangMmdviilUtttia(*(MriratGonpanMaundarawCanpmiu ActerwNahvwulrfhavabaanraqulradlataragfaHcaaKenaMaflar1«tJuytm. fJU Praaanter'a Nama DEIOITTE 4 TOUCHE Addfaaa DELOtTTE 8 TOUCHE HOUSE EARISFORT TERRACE -> ■ ' 2833929 N o m in a l S h a r e C a p ita l C a p it a l - N o m in a l S U k * ! <4 r«foranc«s fc •ra *«tor«t;es to t* c f snsr«s » Kt? to amounts of C la s s Num ber • V a lu e P e r S h a r e O R D IN A R Y 1 .C 0 IR E 1 .0 0 0 u . *y M d m a m b v C a p ita l - Is s u e d . - *- Is s u e d A m o u n ts ■ 1 0 0 .0 0 I R C T o t a l Is e u e d C a p it a l ' 1 3 0 .0 0 I 3 £ P a id u p o n s h a r a Is s u e d fo r c a s h 0.00 0.00 C o n a td a re d p a id o n o t h e r s h a r e s T o t a l c a lls u n p a id W im abtoto*feato yifm anfy. A r t a i i n a l s t rv u t a rt d d n m U * >tAi:3rcvni 117,7*.A v 4 ? OsQ^63* '06Q‘ta^'(O, * :. f o&q a o o G '"52* C W ' ^ T l tL F ^-^SB^EBaBSSFOi • f 10. , ______ _ , 3QSEPWA (.M IT E ll a /C ■ ' I ^ _____________ H/C I M/N n/A D/~A r:v " ClJINNfSS M C T /COLl. Rt<: U / l tA TL K N A L '~'Jo~5■■ : C A L I. j4 (> / » LCJlJijliJiCx>Id/DZa— ,J^= JO CUYNHfJS _tt C T / C P U ___ ^? q -nc iT-“ »n •v v • **•4 ; v ^ t w i f s i i U T/cyi ±4 ‘fv*H t { & W ' k - . P P ' P,:--•rjw ■mK' 031SA65X' %# ^jY^vrit o y ^ o iq i [jft • Hr •'•*?*»■% •iV ^ !gya^'?a6^j^w?~g-wr■i. fr ”j& *', '“ •;. ^—‘. • i'•*"*» i~ i ’t ’' ' rrs r - ' i v i n / A tXTtftNAt CALL 0/A - -2« iMiaMJiH « EXTERNAL CALL D/A 4 12th January, 1988 The Manager, Guinness Mahon Ltd., 17, College Green, Dublin 2,. Ireland. Dear Sirs, Guinness Mahon Cayman Trust.Limited for aoooiint of Blue Jeans Limited Please accept this letter as your .authority, until further notioe, to divulge any information requested of you by the Company’ s auditors, Messrs. Linoe, Salisbury, Header & Co., of Avenue House, St. Julian's Avenue, St. Peter Port, Guernsey, concerning the 'Company's bank accounts and affairs with your bank. Yours faithfully, . 'for Blue Jeans Limited BY COURT ADMINISTRATION UMI tEu rv , >c‘ * S: Capel Street, Dublin 1. JSINE& / JCUPATION: VS Cndit Memorandum • Submitted by: MCK J.B. AGENCIES LIMITED. Equity Stake: NO C.8. Approval: JWi/No Permission Obtained Date: ' 4 Clothing Importers / Wholesalers APPLICATION: New Facility / ( D i k t a t s sp p r o p rh ta ) f ? E: AMOUNT: ..t/5?............. ...— (equivalent Lire) -----In ---- CCC. Stde RATE:.... ’......< .. ...... ....... * ' ..... JRPOSE/DRAWDOWN: If neworIncreased facilities, bdrawdown permitted priorto completion of security? ■ ^v^/nce Autumn/Winter purchases from Companies main P l ^ i in Italy (Pop. 84)- Totally seasonal requirement. ' YES/m :RM OF FACILITIES: . st January 1987 REVIEW OATES: • • 31.1.87. . JURCE OF REPAYMENT: • 'A ■CUR1TY: • If additional orexisting facility, b lacurlty In order? . srsonal guarantee of Directors, Life Policies 150k assigned to us. iequate security approximate value £150k held. If No, givedetailsaeparataly. . » ■" YES/NO • • stCKGROUND NOTE/ JTLINE OF PROPOSAL: Company has been a customer for several years and the account has always ■een conducted In order. All Imports are pre-sold at a mark up of 40% o a wide spread of customers with only a few large accounts e.g. Rcches, tests. Bad debt experience very good. ' ilated Facilities/Borrowers: alance or.Lim it, whichever is greater) C R E D IT C O M M ITTE E Minute....... S 3 1 ......... .......................................................... g Recommended . Data: S A P P L IC A T IO N : H tt w T h i iliiy / Additional Facility / (Delate at appropriate) ........................ TYP E: »"ir~ / c ‘ 1*1" 1" " 1 . ‘ Existing facilities overleaf A M O U N T: ............................ R A T E : ..................................... Ifnawor Incruied facilities, if drawdown permittedprbr to completion of security? PURPOSE/DRAWDOWN: ' VAT Guarantee ' * •>* . . YESSW0 REVIEW DATES: TERM OF FACILITIES: 30th' November, 1986 r ::; ) FEE: 3 .* ' • .. ' 30th Nov. 1986.. • SO'‘^CE OF REPAYMENT: . ' <• N/A SECURITY: ’ ~ ' • . ' . If additional or existing facility, 1*ncurity In ordar? . Joint & Several guarantee of directors considered adequate for £25,000 ’ YES/NO IfNo, glv»detailsseparately. I iAf'GROUND NOTE/ Djli-s IE OF PROPOSAL: Established customers. V A T guarantee cbvers Winter imports. Company has traded very succesfully over the last several years. •Profits y/e 30.4.86. £100k+ . . CREDIT COMMITTEE elated F*cliltl«t/Borrowers: ’ ialanca or Limit, whichever^ greater) L/C facility ^ " £130,0000 Recommended . BOARD •ta’ losure: W Lnnit(s) Recorrt.rl £155,000 Lslii. __ ' n .» .^ ( ,a ( 2 A-.-..-....J ..... D. •• If Cradlt Mumorandum Submitted by: CAW/MCK a g e n c ie s a im it e d ’ , ADo«6SS: 18. Capel Street. Dublin 1 S ^ O H : Clothing Importers . I. * ■ ™ s APPLICATION: Equity Slaka: No. C.B. Approval: Yej/No Permijjion Obtained Oats: N/5<\ • — - ——-— ——— ' *■—— W * »W ««* / Addition* Fadlltv / ‘Exliting ficllltloa ovtrlaaf fDtftt* » tpproprhtt) nTCj Guarantee AMOUNT: -J iz z x z z f- ------------ ......... ... -----‘ — .......... . M s ------------ ........................... r . iPOSE/DfMWOOWN: • • \...'hfcuarantee . If rimror Incraand facWtlat, b drawdown permittedprior to completion of Mcurlty7 • . :r* • YES/IW REVIEWDATES: TERMOF.FACILITIES: 30th April, 1987 ■ , 30th April, 1987 . SOURCE OF REPAYMENT: N/A If additional or M litlng facility, fc tacurity ki ordar? SECURITY: Joint & Several guarantee of directors considered adequate . £25,000 ............ ... .... ..... BACKGROUND NOTE/ OUTLINE OF PROPOSAL: YES/NO II No, giw datallt nparataly. . • Established customers. V.A.T. guarantee covers Winter ■*!»«* k^ successfully over the last several years. Profits y/e 30.4.86 flOOK* m p “ :r- ha® * Very V Holatad Faciiitin/Borrowtu: talancs or Limit, whichevar is greattrl . CREDIT COMMITTEE Minute.. 1 0 k . k ..... Date.... ...... J Recommends___________ Apndixxva?ums). I ADDRESS: IB Cnpel Street, Dublin 1 Equity St,it"?: BUSINESS/ OCCUPATION- ... , t ..... , clothm 9 Importers/Wholesaler s. NO C.0. Approval: Yes/No Permission Obtained Datp: N/A Inrrnntn / Extension / RKJKJttfMKXX THIS APPLICATION: (Online asnnprnprhtn) TYP£. (a) Letter of Credit (It.J i m (b) Guarantee ' 'lh7.mil! inn) A M O U N T £193,92) ,, ( Inrri'usc It mi) L'8H,’)/>() l l . 1 i r.i 10.7 Mi.l.l.i.on)---.- RATE: ..................................... FEE:£. !. -50 per rpi11 ..................................... *30,000 (lncrcnso from £25,000) ............. £300.00 If new or increased facilities, is drawdown permitted prior to completion of security? PURPOSE/DRAWDOWN: (a) To finance Spring/Summer purchases from main supplier in Italy. (b) To cover deferred payments of V A T at point of entry. YES/>W® REVIEW DATES: TERM OF FACILITIES: (a) To 30th May, 1987 \ 28th February, 1988 (b) To 28th February, 1988 SOURCE OF r e p a y m e n t : Majn Bankers: _ ... From cash flow. SECURITY; Ulster Bank, 2/4 Lower O'ConneJI Street. 0/d £50k l / q £i25k w ^ a ui l v *“*' w• i If additional or existing facility, is security in order? Personal guarantee of directors, L ife policies £150k assigned to us. YES / N O Adequate security value £!96k held Counter Indemnity re V A T Guarantee to be completed. BACKGROUND NOTE/ o u t l in e OF PROPOSAL: If No, give details separately. J . B. Agencies Ltd. are in the business of clothing importers and wholesale retailers. The directors and owners are Jim Sweeney & Terry Kennedy. Company Mas been a customer for a number of years and the account has always been conducted in order. A ll imports are pre-sold at a 40% mark up to a wide spread of customers with only a few large accounts e.g. Roches, Bests. Bad debt experience very good. Profits y /e 30.4.86 - £IOOk+. Recommended. Appendixxvamna? a Submitted by: 13 C a p e l S t r e e t , ..eSS: D u b lin 1 Equity Stake: BUSINESS/ OO ATION: C lo th in g THIS APPLICATIO N : C.B. Approval: Yes/No Permission Obtained Date: N /A Im p o rte rs / W h o le s a le rs PTO Now Facility / )«Jdjlkkwxlx5i3C^k)(^^WX!*3«K^fx)CTXi»«><)R?JW5 REVIEW DATES: fc R M OF FA C IL IT IE S : T o ^ th Ja n u a r y 1988 15.01.88 M a in B a n k e r s : U ls t e r B a n k 2/4 L o w e r O 'C o n n e ll S t . o/d £50k L/c £125k S e c u re d b y g e n e ra l c h a r g e . SOURCE OF REPAYM EN T: F ro m ca sh flo w . If additional or existing facility, is security in order? SEC U R IT Y : P e rs o n a l g u a ra n te e o f d ir e c t o r s , lif e p o lic ie s £150k a ssig n e d to us. 2nd F ix e d and F lo a t in g c h a r g e o v e r c o m p a n y a s s e ts , ra n k in g a f t e r c h a rg e to U ls t e r B a n k . 1st Y E S /I*R n v f .v j. A d e q u a te s e c u r it y v a lu e £207,700 If No, give details separately. h eld . ■ „ y BACJjMiROUND NOTE/ OU1 j E OF PROPOSAL: J . B . a g e n c ie s L t d a re c lo th in g im p o r te r s and w h o le s a le r e t a ile r s and h a v e b een kn ow n to us fo r som e y e a r s . A / C has a lw a y s been c o n d u c te d in o rd e r and th e d ir e c t o r s an d o w n e rs o f th e c o m p a n y a r e J im S w e e n e y and T e r r y K e n n e d y . T h e im p o rts a r e p re-sold a t a 4 0 % m a rk up to a w id e ra n g e o f c u s to m e rs , th e la rg e a c c o u n ts b e in g R o c h e s , B e s ts , S m a r ts , C le r y 's & S w it z e r s . Bad d eb t e x p e rie n c e v e r y good. P r o f i t s y/e 30.4.86 £ 1 0 ,6 9 7 a c c o u n ts a tt a c h e d . Recommended. Related Facilities/Borrowers: (Balance or Limit, whichever is qreater) C u r re n t a/c d/a V A T G u a r a n te e £400 D R £75 CR £30,000 C R E D IT C O M M IT T E E Minute,.. .... ....................... ............................................. ........................................................................ Recommended BOARD Total Exposure: £220.700 . . . S T ? V ........ o i l .......... U i l ° W Limit(s) RPnnrrlpH Kw / i t <~C i t y, '' DDR ESS: 13 C ap e! S t r e e t , J SIN ESS/ CC'JPATION: C lo th in g HIS APPLIC A TIO N : D u b lin 1. Equity Stake: \j q C.B. Approval: VfeS/No Permission Obtained Date: Im p o rte rs / D is t r ib u t o r s I)i^:£aK&lncrease / (Delete as appropriate) VDC- F/X L in e AMOUNT: ..£.2S0.iQ0.Q.................. RATE: ....... ....-............... If new or increased facilities, is drawdown permitted prior to completion of security? PURPOSE/DRAWDOWN: F o r e ig n F E E : ......... t E x c h a n g e D e a lin g . Y E S / I^ c R E V IE W DATES: T F " " '1OF FA C ILIT IES: 15.01.88 (T o c o in c id e w it h e x p ir y of L/C 15.01.88 f a c ilit ie s ) SO URC E OF REPAYM EN T: O th e r B an k ers: U ls te r B a n k , O 'C o n n e ll S t . N o rm a l tra d in g . __________________________________________________________________ If additional or existing facility, is security in order? SEC U R IT Y : P e rs o n a l g u a ra n te e of D ir e c to r s . L i f e P o lic ie s fo r £150k assign ed. 2nd F ix e d & F lo a tin g c h a rg e o v e r th e c o m p a n y 's asse ts, ran k in g a f t e r U ls t e r B a n k 's 1st c h a rg e . S e c u r i t y co n s id e re d a d e q u a te fo r £207,700. YES/N O If No, give details separately. > ^ ______ _____ . . B A ^ G R O U N D NOTE/ O y tfJJN E OF PROPOSAL: ..................... L e a e r o f C r e d it f a c ilit ie s o f £199,000 a r e p r e s e n tly in p la c e . C o m p a n y h as b een d e a lin g in F o re ig n E x c h a n g e and re q u ire s fo rm a l lim it . A lin e o f £250,000 (ris k £2 5,000) should be s u f f ic ie n t and is re co m m e n d e d . ' Related Facilities/Borrowers: (Balance or Limit, whichever is greater) CREDIT COMMITTEE Minute.... .......................... Date.... L / C 's £199,000 V A T G u a r a n te e £ 30,000 ...... ............................... /Recommended BOARD .......i l ? , .......... o ? .......... d m . L A p p ro v e d h r . t . 2 : ..... 3 Cfatlit Mamoranuuxi Submittedby: CAW . B Agencies Limited :. . . J E 18 Capel Street, Dublin 1 * Equity Stake: Nfl C.B. Approval: Yai/No ParmfMlonObtained Data: N/A less/ clothing Importers/Distributers PATION: APPLICATION: NewFacility (Dahl* « ffiproprktsl Letter of Credit__ AMOUNT: £?.99jS99i............. RATE:..... (Italian million) . •__ HMHMHMIIILire MHillNM390 lMllrt nH *“*■ Ifnaw orlncrtsud facilltfai,h drawdown permittedpriorto completion ofwcur!ty7 POSE/ORAWOOWN: t f ' :SToe late Spring purchases from main supplier In Italy sight drawings. YES/MX REVIEW DATES: (M OF FACILITIES: 15 April 1988 15 April .1988 Main Bankers: Ulster Bank Ltd. 2/4 Lower O'Connell Street o/d £50k: L/C £l25k. Secured by. general charge. JRCE OF REPAYMENT: 3m cash flow. ; u m t y : rsonal guarantee or directors, life policies £150k assigned to us. cond Fixed and Floating charge over comparty assets, ranking ter first charge to Ulster Bank. . let, s security value £220,000 held. . ' vCKGROUNO NOTE/ JTLINE OF PROPOSAL: Ifadditionaloraxlatlng facility.Isnourlty Inordar? YES/N8 IfNo,gWa detail*separately. . ' * B Agencies Ltd. are clothing Importers and wholesale retailers, and have been known- to us for me years. A/C has always been conducted In order and the directors and owners of the company e Jim Sweeney and Terry Kennedy. The Imports are presold at a 40% mark-up to a wider range customers; the Isrge accounts being Roches, Bests,' Smarts, Clerys & Switzers. Bad debt perience very good. Estimated profits year ended 30/4/87 £30,000. 0 , * scornmended. elated Facillllm/BorroM'ori: lalanceor Llmli, wltichcvar IsOfaalRf) jri 3p . Account Account £ ICR £ 74CR cinnno CREDIT COMMITTEE Minula.................I L i = ^ I U Rncommnnded : . .... C H. A p p i o v n l : BUSINESS/ (D ot hing O C C U P A TION I m p o r t e r s / I ) i s i r i l j u t or s. Hate; • THIS A PPLIC A T IO N : i N»:w R o r a ' x i . Y ; / , W k M ' * X > J t R . V x ! VAT ............ d N /A Extension / fyM ^'S'Jc.x (l)olr!n ns npprnprinlv) TYPE- Y ps/ N Ter m i s s i o n O b t a i n e d ’ Boef a «HJ *«r : j i * b l 5 CJ mr t « r f x X AMOUNT: ... £ : , ( ) - 0 0 0 ............................ HA r F ............‘ ............................... TEE: 1% P - H . .................... If n o w o r i n c r e a s e d PURPOSE/DRAW DOW N: f a c i l i t i e s , is d r a w d o w n To cover deferred paym ents of VAT at point of entry. p e r m itte d prior to c o m p le tio n of security? YlsSY-'NO REVIEW DATES: TERM OF FACILITIES: E x ’, ’s i o n SOv JE OF REPAYMENT: From for Cash 6 N /A m onths. 31st IM ster S t. F low A ugust, 2/4, Hank, O /D 50k; S ecured by 1988 Lr. L /C O 'C o n n e l 125k general charge. If a d d i t i o n a l o r R x i s t i n g SECURITY: f a c i l i t y , is s e c u r i t y i n o i d e r ? Personal us. of D irectors. Fixed and First C h arge to after at g u aran tee Second £2 2 0 ,0 0 0 Floating U lster y e ^ 's ant, such The erry as profits overall 1,/C for account facility E xtension of requirem ents has alw ays The S tores, Y /E over L td. requested K ennedy. R oches P olicies 150k assigned c o m p a n y 's A dequate assets securities to Y E S/N O ranking valued If N o , (jive d e t a i l s s e p m a t o l y . f’j : ' O' f \ i N E OT P R O P O S A L : its Bank held. B /'r , 'G n o U N D NOTE/ covering L ife C harg e goods A rnotts, 30.4 .1 9 8 7 £ 2 00,000 to end for the been of recently A ugust follow ing condu cted im p o rted S m arts, are C lerys year. in pre approved w hen th e The order. sold and at expir es tiexl com pany w ill com pany D irectors a m ark Sw itzers. Had have and up of m onth. subm it been I lie an know n shareholders 40% debts to are w ell extension now application are lo Jim know n m inim um . us for som Sw eeney retail outle E stim ated £30,000. recom m ended. CREDIT COMMITTEE R e i n t o d F n c i l i t i p s / B o r r o w f ’r*;: ( B a l n n c o o r L i m i t , w h i c h c v o r is cj f nnt cr) Min.Ul-....! } ' ! L etter of C redit F acility £2 0 0 ,0 0 0 ................... A . ' ' ............ ,1 — - ) : I 2 -! f .......... ............... -*Rncnmmondrd BOARD ■?J? Tot, i t E x p o s t i t r : M i n u t e ........................... ............... £ 230,000. ' J o w L i m i t («;) R e c o r d e d h y ; .................................................................... D. i t e '•’a i r i l y in o i d e i fnr O r n v v d o w n ................................................................. „ O n t o ...... . A >f)rnvP(i G . M . & C o . (i( o v e r E l m l o i n I ox p o s t i n ' ) V V S ^ .9........... .............. n tm rv ; ! 8, ( ; i p f ■1 S i r o o t , f ) u l >i i n , 1. E q u i t y S i . i l ' i' : No C l). A p p m v a l : i iniNi-s:'/ ( 'In t hi C( : I PA 1 I O N ' X ’j j N o P c r m i i i i o i t OI )i;iiiird I m p o r t e r s / l )ist r i b u t oi s hr Dntn: m s appi . i ica r i ( X ' N X i KW i vs J X i ' ' ' ' ' ' - ‘i ^ f’ / E x t e n s i o n io n Ifh'/rtP ,is n/i/n npi VIT: .................................................................. \ \ Y ' F: x i t i n f] fncf lit inr nv' vl r ' nf AMOUNT: .......................................................... < m: lf Mrji <.'r- RATE: ............................................ J R O O . O t M ........................ f FT ................................................ .............. ............................... ...1% J ’A ................... ( t 7 . r,H pnr mi I 1o rri nprnjrir]' I• t ter I (ii :-i ij'n p C' » f tiit I a d Ii t y f .xc h n n g o J R £ 3 00,.000 I.i n e ( e q ui v ; i I f ' u r ) 1 1.sn ...............- - ....................... ( p P F . ..rri.ii.ip n n . r . o y r ^ . / i i - . ) IR£ 2 5 0 ,0 0 0 If .JU ro.'T /D R A W D O W N : now oi i n c m n M ’d f n c i l i t i ns , is d r a w d o w n . Id cover deferred . To finance . To cover r RM 'T r 1 purchases Foreign RA W D O W N : paym ent from in VAT at suppliers, Fxchange A lready a c ; 1L of point of m ainly en trv . p e r m i t t e d pi i nr t o c o m p l e t i o n of scent ily ? Italian. dealings. ? € $ / NO nlace. REVIEW DATES: 1T I E S . 31/8/1989 V ea r T: HJRCE OF RLPAYM EN N orm al O T lir.R HANKS: U ls te r Hank, D i i i l in, 1 . T rading O 'C o n n e ll If a d d i t i o n a l oi e x i s t i n g ' C U R I T Y: f a c i l i t y , is s e c u r i t y i n o r d e r ? I’e r s o n a l l ife G uarantees P olicies Secoud a fte r - c i i i it y on fixed K ennedy for floating Hanks considered T. D irectors and U lster of first £2f>0K ch arg e charge adequate to and the each, over for J.H . assigned c o m p a n y 's to G&M . assets of - If N o , rjive d e t a i l s s e p a r a t e l y . N ew R £ 3 0 7 K . g u aran tee F ixed be o O 'f'ES.XNO ranking IR £200,000. extern, . r Sw eeney, am ount AJ k TT r S t., to be and for increased com pleted. flo atin g stam p ed up to charges to IR £380,000 UND NOTE/ J T M N E 0 f : PROPOSAL: H. / ie appendix ncies F td. norm siness. w ell in to for doclarrc' conducted. ipiove been tilt h o u g h A ccounts increase has .sum m a r i s e ? a it the is that year is 1983. since trading As result s . and this does ended profits. S ecurity IR £I00K client the' not 3 0 /'l/8 8 considered approxim ately in th e ’I.'U' t I Ttli:ilitif’<;/nnr r o w e r s: accurately reflect is adequate com ing increased position. are M anagem ent turnover financial due shortly experienced to year. the the and in extent so S m all art' the of true did its requirem ents. even profit ab ility ex p ected rag l./C' p ro fits/b reak track' I R £ 3 0 7 K. to has the show and T his of the is account likely to R ecom m ended. CREDIT COMMITTEE . i l nn ee m L i m i t , w h i r h c v f ' i is ( j i o i i t f i ) IR£ \T ( M iarantee ( ' F acility X l.iiu- >'•'1 •w Limiil-.) CT 30.000 Mini Hr?..... f(. ..'t...................... Onto..................................... ......................... A ....... / .................... R(!C()i nmr’inl n(l 300,000 20% 50.000 R£380,000 n.'r.DMlcrl by:...... b o a r d M M' 111 f*........................................... y fa n Appn (vod ................ U /87 ' 90 10127 11/87 *90 I s 733032 J8 AGEHCIE? LTD 2 733032 JB MEIICI^LTD • HI >• 0 48 12 62 16 TELEFAX COVER . To: I l g j y J i n n f i x --------------------- Company: J. Telefax No: f l M W I M H -------------------- * . Prom: B. B lue A gen cies Jeane A .. of, 1 / 0 Dale: L ln lttd . ■2i.4.6j.9.Q. .— — NoTofPagei,___i Timo; •W e.v ieh to co n firm th a t w e C r e d it f a c i l i t i e s p rovid ed s t e r lin g £ 4 7 5 ,0 0 0 , We c a n d e p o s its In support o f any BLUE J EANS L I M I T E D .- * F lftU U lA * MEfiSAGKi for Iltnlfced (Includingcover) . . a r e w illin g to guarantee L attar of e o y o u r s e l v e s up t o a naxlm um o f p r o v id e c o l l a t e r a l In th e form o f c a s h ouch g u a r a n te e . . ! A. J . N ic h o l s D irector i. ( Y*Udo nMraoolvt til (hi M{ei, or If any ponlrvi «(ttwUtniinl titon U IlleilWc, pluis unify Ui *(» utiptimie, It Mu or Ula* lmn»Jhuty mi tba .tumtat ivMb*lowi IV O R F ITZ P A TR IC K & CO. SOLICITORS ?a 44-45 ST. STEPHEN’S GREEN. DUBLIN 2. T ELEPH O N E: +353 1 678 7000 FA X: +353 I 678 7004 D X 53 D U B LIN . E-M A IL: info@ivorfitzpatricfc.ie website: www.ivort1tzpatrick.ic Mary Cummins Solicitor to the Inspectors 3rd Floor Trident House Blackrock Co. Dublin 22 January 2002 Our ref Your ref Direct Fax DC_SEC266 C/K09 & C/S02 661 3555 BY FAX: 2833929 /"s Re: Our Clients - James Sweeney and Terry Kennedy - JB Agencies Limited Dear Sirs, W e refer to previous correspondence in this matter and make the following Submission in respect o f your draft preliminary conclusions:The evidence adduced does not allow for a definitive conclusion as set out in the Inspectors preliminary conclusions. The Inspectors are o f the view that JB A gencies Limited is a client o f Ansbacher together with the com pany called Blue Jeans Limited. There should not be a conclusion that JB A gencies Limited is a client o f Ansbacher. JB A gcncies Limited has no knowledge o f GMCT Limited and never had such knowledge and does not accept that it was a client o f Ansbacher. JB A gencies Limited had a business relationship with a company called Blue Jeans Limited. As far as JB A gencies Limited was concerned its banking relationship is with Guinness & Mahon Limited, 17 C ollege Green. The existence o f the letter o f the 12th January 1988 is not relevant to the issue in so far as JB A gencies Limited is concerned. They are not the authors o f the letter, they did not authorise same and it was not addressed to them. Whatever relationship Messrs. Blue Jeans Limited had with Guinness and Mahon or any accounts, which it may have had with it are not a matter for concern o f JB A gencies Limited. Having said that the form o f the letter is highly unusual in that it is not on the notepaper used by Blue Jeans Limited and it is not known when the name Blue Jeans Limited was actually typed onto the letter and is o f different type to the rest o f the letter and would clearly have been done at a different time to the rest o f the letter. Another document also relied upon by the Inspectors is an internal GMI credit memo dated 27th o f August 1988. The Inspectors have concluded that the author o f the document in GMI Jennifer Blunden. Deirdre Courtney, Ivor Fitzpatrick, Corwac Gordon, John King, Mary-Clairc Morkey, Bernard McEvoy, Michael J. O'Connor, Margaret Scully, Susan R. Stapleton. John Burke, Karen Hickey Dwyer, Susan Fenton, Ita Guilfoylc, Edel Kirley. Lorna McAullffe, TTlona Molloy, Dympna Murphy. Orlaith O ’Brien, Lisa Richardson, Milan Schuster. thought that JB A gencies Limited beneficially owned the deposit o f Blue Jeans Limited. This conclusion cannot be arrived at and does not arise from the document in question. In summary the Inspectors have reached a conclusion that JB A gencies Limited was a client o f Ansbacher. JB A gencies Limited never had any dealings with Ansbacher and did its banking with Guinness & Mahon o f 17 C ollege Green. Mr. Sweeney & Mr. Kennedy o f JB Agencies Limited were not aware o f the connection between Guinness & Mahon Limited and Ansbacher. The Inspectors should not reach a conclusion for which there is no evidence that JB Agencies Limited is a “client” o f Ansbacher. Yours faithfully, IVOR FITZPATRICK & CO, f j V if t D f o ? G > u Q 'fo g * DEIRDRE COURTNEY / ' IVOR FITZPATRICK & CO A p p en d ix X V 1. (144) M r R a y C a rro ll E v i d e n c e relied up o n b y the Inspectors in arriving at the c o n c l u s i o n relating to Mr R a y Carroll. a) Transcript o f e v i d e n c e o f M r Ray Carroll dated 13 February 2 0 0 1 . b) G u i nn e s s and M a h o n credit m e m o o f 11 A u g us t 1988. c) Letter o f 2 4 D e c e m b e r 1 9 8 6 - MJ Pender to B A Ursell. d) A p p e n d i x 10 o f Central B a n k report on G u i nn e ss and M a h o n at 3 0 April 1978. e) Gu i n ne s s and M a h o n statement o f 2 0 January 1 9 86 re G M C T / C o l l e g e re. Sumac. f) G u i nn e s s and M a h o n statement o f 31 March 1 98 0 re G u inn e s s M a h o n G ue rns ey Limited. g) Internal IIB mi nu t e re credit application o f Murray Group H o l d i n g s o f 3 February 1989. h) Letter o f 11 N o v e m b e r 1988 - IIB to K P M G St oke s K e n n e d y Cr owle y. i) Letter o f 23 July 19 93 - Mr Ra y Carroll to IIB. j) Letter o f request for information from K P M G S t oke s K e n n e d y C r o w l e y to IIB dated 31 D e c e m b e r 1992. k) Letter o f 11 N o v e m b e r 1 98 8 - IIB to K P M G S toke s K e n n e d y C ro wl e y . 1) Letter and attachments o f 12 October 1 9 87 - G M C T to G u i nn e s s and M aho n. P R I V A T E E X A M I N A T I O N O F MR. RAY CARROLL UNDER OATH ON TUESDAY, 13TH F E B R U A R Y 2001 I h e r e b y c e r t i f y the f o l l o w i n g to be a t r u e an d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The Inspectors: HIS H O N O U R JUDGE SEAN O'LE A R Y MS. N O R E E N M A C K E Y BL S o l i c i t o r to t h e I n s p e c t o r s : MS. M. C U M M I N S Interviewee: MR. R A Y C A R R O L L WITNESS MR. R. CARROLL I EXAMINATION JUDGE PAGE 51 1 2 3 4 5 JUDGE O'LEARY: M y n a m e is S e a n O ' L e a r y . I a m o n e of t h e 6 7 Inspectors; 8 M R . CARROLL: Yes, 9 JUDGE O'LEARY: A n d t h i s is N o r e e n M a c k e y . al l r i g h t ? sure. S h e is a n o t h e r o n e o f t h e 10 11 Inspectors. 12 MR. 13 JUDGE O'LEARY: CARROLL: O ka y . 14 We are the two Inspectors that are c o n s i d e r i n g this 15 s m a l l a s p e c t o f it a n d it is a s m a l l a s p e c t o f t h e 16 thing. 17 W e h a v e a n u m b e r o f q u e s t i o n s t o a s k y o u a n d it 18 w i l l b e v e r y i n f o r m a l a n d it s h o u l d n o t b e l e n g t h y . 19 T h e o n l y f o r m a l i t y in it r e a l l y is t h e t a k i n g o f 20 the o ath b e c a u s e we are r e q u i r e d to have the m a t t e r s 21 u n d e r o ath. 22 you the que s t i o n s then? 23 24 25 26 27 28 29 It is n o t a m a j o r a s p e c t o f t h e t h i n g . If y o u w o u l d t a k e t h e o a t h w e w i l l a s k 1 2 3 4 5 1 Q. JUDGE O'LEARY: Mr. C arroll, of a ll 6 7 f o r coming. 8 inform al procedure. 9 about a p a r t i c u l a r This is, as I say, could I f i r s t t h a n k y o u v e r y much a reasonably We a r e g a t h e r i n g i n f o r m a t i o n company a nd y o u know t h e name 10 of that c o mp a n y. 11 various o t h e r name s i n t h e p a s t 12 felt, 13 that It is " A n s b a c h e r " a nd i t according to the l e t t e r h a s h ad a n d I know t h a t y ou w hich you s e n t t o u s , y o u h a d n o t h i n g t o do w i t h t h a t c om pa ny . 14 15 U nfortunately, 16 o f p e o p l e who g e n u i n e l y b e l i e v e d t h e y h a d n o t h i n g 17 t o do w i t h t h e 18 w i t h t h e co mpa ny e v e n t h o u g h t h e y m i g h t n o t h a v e 19 known i t . 20 w h eth er t h e y were c l i e n t s 21 that 22 Court. is we h a v e f o u n d t h a t quite a number compa ny a c t u a l l y h a d s o m e t h i n g t o do We h a v e t o e n q u i r e o f t h e s e p e o p l e of "Ansbacher" b e c a u s e o n e o f t h e t h i n g s we h a v e t o report to the 23 24 We a r e n o t i n q u i r i n g i n t o your p e r s o n a l a f f a i r s . 25 We a r e n o t i n q u i r i n g i n t o your ta x a f f a i r s . 26 is 27 o u r d u t y t o t h e H i g h C o u r t b y r e p o r t i n g on t h e 28 co mp a ny and i t s 29 customers o f the n o t h i n g t o do w i t h u s . a ctiv ities T h at We a r e m e r e l y f u l f i l l i n g a n d f i n d i n g o u t who t h e company w e r e . 1 2 I t h i n k y o u come i n t o the p ictu re because 3 you were em ployed by, a nd i n d e e d h a d some i n t e r e s t 4 in, t h e Mur ra y Group a t o n e s t a g e ; 5 A. That i s 6 Q. And w h a t was y o u r p o s i t i o n 7 Mr. right, C arroll? I j o i n e d t h e Group i n 1 9 5 3 . 9 Q. Yes ? 10 A. I had b e e n a q u a l i f i e d a c c o u n t a n t b e e n an A u d i t A s s i s t a n t Q. Yes ? 13 A. And I w e n t i n a s an a c c o u n t a n t 14 Q. Y e s? 15 A. And I b e c a m e F i n a n c i a l D i r e c t o r o f companie I suppose. some t i m e i n 1960's. 17 Q. Yes ? 18 A. I haven't 19 Q. Y e s? 20 A. And t h e n I b e c a m e C h i e f E x e c u t i v e 21 a nd I ha d w ith a couple 12 the correct? i n t h e Group, A. 16 that yes. 8 11 is I think got the p r e c ise date. in 1977 u n t i l 1991. 22 Q. Y e s? 23 A. And I r e s i g n e d i n 24 Q. Yes ? 25 A. The 3 0 t h J u n e 1 9 9 5 . 26 Q. Y e s? 27 A. And I r e s i g n e d a l l 28 Q. Yes, 29 A. And I d i d h a v e a s h a r e h o l d i n g i n t h e Gr oup , 1995. D irectorships. I understand? which 1 2 12 Q. 3 A. 4 13 Q. 5 A. 6 14 Q. 7 A. 8 15 Q. 9 Y e s? Whi c h h a d b e e n a c q u i r e d i n t h e 1960's. Y e s? And t h a t was p u r c h a s e d b y t h e Group i n From y o u , So, that 1993. yes? is it. And y o u r e x i t f r o m t h e Group was p a r t o f t h e n o r m a l retirem ent process? 10 A. 11 16 Q. 12 A. Yes, 13 17 Q. Yes. Yes. T h a t w o u l d b e t h e b e s t o f way o f d e s c r i b i n g i t ? yes. I think, if you l i k e , you a c t e d as C h i e f 14 E xecutive 15 the wheel o f the 16 tim e i n which t h e o l d e r g e n e r a t i o n were i n ch a r g e , 17 if 18 Mr. company d u r i n g t h e p e r i o d o f I could put i t 19 A. Yes. 20 18 Q. Yes. 21 A. 22 19 Q. 23 A. 24 20 Q. 25 A. 26 21 Q. 27 A. 28 22 Q. 29 and y o u a c t e d a s an i m p o r t a n t c o g i n Murray t h a t He d i e d . He d i e d i n is that; is that correct? now d e a d ? When d i d h e d i e ? 1995. B e f o r e you r e t i r e d No, lik e a n y way I t h i n k ; was i t not? no. Was i t Yes, after it A fter you r e t i r e d ? was a f t e r yo u r e t i r e d . I w ill That i s get it grand. I retired . I see, yes. 1994; was i t ? f o r y o u now. I think i t was 1 9 9 4 ; all right? The 1 D i d y o u r co mpa ny - - I am t a l k i n g 2 now o n l y b e c a u s e not because 3 the d e t a ils 4 h a v e a l r e a d y s p o k e n t o Mr. 5 So , 6 A 7 24 Q 8 of the A 10 25 Q 11 A 12 26 Q 13 A 14 27 Q 15 A 16 28 Q 17 A 18 29 Q company w i t h y o u ; However, the co mpa ny ha d a b u s i n e s s Th e y h a d , & Mahon; is that If I could j u s t Yes ? He d i e d i n J a n u a r y 1 9 9 5 . Ja n u ar y 1995? Yes . Was i t Yes, as l a t e as t h a t in fact? yes. Thank y o u . The company h a d a b u s i n e s s relationship? W ell, A 25 31 Q 26 How d i d t h a t t h e Group u s e d t o b o r r o w f u n d s various 24 correct? g o b a c k on w h a t y o u s a i d ? that business 30 Q relation sh ip Yes ? 20 23 I yes. & Mahon. 22 I do n o t . Yes . w ith Guinness A go i n t o H a r o l d Mur ra y a b o u t t h a t . 19 21 I want t o company y o u n e e d n o t w o r r y a b o u t t h e c ompa ny t o o much? w ith Guinness 9 -- about th e fin an cial relation sh ip come a b o u t ; from a l l the in stitu tio n s. Yes ? And a m o n g s t t h e m was G u i n n e s s Yes. Were G u i n n e s s & Mahon, & Mahon. if you l i k e , the p r i n c i p a l b a n k e r s o f t h e Group? 27 A 28 32 Q 29 A No. Not r e a l l y , no? Th e y w e r e n ' t , no. We d e a l t w i t h t h e Bank o f 8 Ireland 1 2 33 Q 3 A 4 And we d e a l t w i t h UDT v e r y s u b s t a n t i a l l y the 5 34 Q 6 A 7 earlier in days. Yes ? And a f t e r that F o r d M o t or C r e d i t . May be Lombard & U l s t e r . 8 35 Q 9 A 10 36 Q 11 A 12 37 Q 13 Y e s? That i s it. Yes ? Th e y w e r e t h e m a i n b a n k e r s , Do y o u reme mbe r i n A 15 38 Q 16 A 17 39 Q 18 A Yes, 40 Q 21 H a r o l d F Murray t h e Woodward T r u s t ? yes. You reme mbe r t h a t ? I do, yes. Yes. I knew t h a t was e s t a b l i s h e d ? Although, I remember t h a t . if back c l e a r l y 19 yes. 197 4 when Mr. e s t a b lis h e d a Trust c a l l e d 14 20 Yes ? No. I could say, to my memory d o e s n ' t go 30 y e a r s a g o o r w h a t e v e r i t You c a n t a k e it that I know t h a t t h e was. Trust was e s t a b l i s h e d a n y way? 22 A 23 41 Q 24 A B u t y o u k i n d o f . . . ( INTERJECTION). Yes ? I n f a c t when I knew I was c o m i n g h e r e y o u r e s e a r c h 25 a nd y o u k i n d o f r a c k y o u r memory t o 26 h a p p e n e d on a l l 27 42 Q Y e s? 28 A And, 29 43 Q Y e s? yes, these certainly. occasions?" say, "Well, wh a t 1 2 4 4 Q. 3 A. You reme mbe r a l l Because i t that? arose because p ro p erties w ith in the 4 Group w e r e s o l d a n d t h e r e w e r e k i n d o f w i n d f a l l s 5 for the 6 45 Q. 7 A. c om pa ny . Y e s? Because th ey d id n 't come i n t h e n o r m a l r o u t i n e 8 business. 9 which were u s e d f o r p a r k in g c a r s , 10 a nd t h e 11 4 6 Q. 12 A. There were p r o p e r t i e s And t h e n Esmonde M o t o r s o p e r a t e d f r o m S e r p e n t i n e 14 AIB w e r e b u y i n g up a l l 16 A. 17 48 Q. 18 car m aintenance Yes? A v e n u e and t h a t 47 Q. i n H a d d i n g t o n Road funeral b usiness. 13 15 of A ll the land, arose q u ite u n expectedly because the la n d around t h e r e . yes. Yes. T h ey w e r e l i t t l e w indfalls t h a t he p u t a s i d e in t h e Woodward T r u s t ? 19 A. 20 4 9 Q. Yes. And I am n o t c r i t i c i s i n g 21 Woodward T r u s t . 22 it 23 A. 24 50 Q. 25 h i m i n a n y way a b o u t t h e I am j u s t s a y in g as a f a c t was e s t a b l i s h e d ? Yes. Who w e r e t h e b e n e f i c i a r i e s of that Do y o u know who t h e b e n e f i c i a r i e s 26 A. 27 51 Q. 28 A. 29 52 Q. The b e n e f i c i a r i e s If y o u do n o t I don't o f the Trust? Trust? were? No. know s a y s o ? know i s w h a t I am s a y i n g . Were y o u o n e o f t h e p o t e n t i a l b e n e f i c i a r i e s that 1 2 A. 3 I was b e c a u s e -- yes. I am n o t m entioned s p e c i f i c a l l y 4 53 Q. 5 A. 6 54 Q. 7 A. 9 55 Q. 10 A. 11 56 Q. 12 A. 14 57 Q. 15 A. 16 58 Q. as a b e n e f i c i a r y . Yes. However, we a r e n o t t a l k i n g the p ie c e s I am t a l k i n g about the r e a l i t y a d if f e r e n t m atter a lto g e th e r ? Yes. Whic h I am n o t p a r t i c u l a r l y 21 A. 22 60 Q. 23 A. 24 61 Q. 25 A. 27 62 Q. 29 in? However, a t t h e t i m e y ou u n d e r s t o o d t h a t Yes, So i f in i t , which r e f l e c t e d is that y ou your it? yes. yo u h a d a 9% i n t e r e s t That i s right, i n t h e company? yes. You h a d a 9% i n t e r e s t in th e Trust? Yes. How t h a t was e x p r e s s e d a t a l a t e r stage is another go i n t o at a l l . matter? 26 28 in terested Yes. s h a r e h o l d i n g i n t h e co mpa ny ; 59 Q. situ ation ? I am n o t s a y i n g y o u e v e r g o t a n y t h i n g o u t o f i t . 18 20 of the Yes. h a d some i n t e r e s t A. I am n o t t a l k i n g o f p a p e r now? 17 19 about, Okay. That i s 13 I was I understand that? about, 8 sure Yes, yes. Whi c h we a r e p r o b a b l y n o t g o i n g t o Would t h a t b e a f a i r summary o f t h e p o s i t i o n ? 1 63 Q. 2 A. 3 64 Q. 4 A. 5 65 Q. 6 A. 7 66 Q. 8 A. 9 67 Q. 10 A. If it No. is n o t now t e l l me i t He s e t I mean t h e s e w e r e v e r y p o p u l a r a t t h e t i m e . Y e s? I th in k they probably s t i l l D iscretion ary Trusts. Y e s? Bu t t h e r e a s o n h e d i d i t was b e c a u s e t h i s normal c o u r s e o f b u s i n e s s . A. was a w i n d f a l l 16 a fairly 18 A. 19 70 Q. 20 A. came i n . And I mean I know t h e r e a s o n s there; 69 Q. that d ifficu lt Y e s? The M u r r ay s h a d l o s t the Hertz Not th r o u g h t h e i r own f a u l t b u t b e c a u s e H e r t z a nd he d i d n ' t w a n t t o do t h a t . A. And t h e n t h e r e was an o i l was s e r i o u s talk 26 quite of talk 27 Taxes. 29 72 Q. f r om Mr. Murray Yes ? 25 28 franchise. Y e s? 22 24 t h a t t h e m on e y w e n t tim e. w anted t o buy o u t t h e b u s i n e s s 71 Q. I t w asn't in the b e c a u s e t h e b u s i n e s s had b e e n g o i n g t h r o u g h 21 23 mone y - ­ Y e s? 15 17 are. Y e s? 12 14 y o u know? Y e s? it 68 Q. not, up a D i s c r e t i o n a r y T r u s t . 11 13 is Yes. a lot crisis a nd t h e n t h e r e o f d e v a l u a t i o n a nd t h e r e was about Wealth Taxes, So t h a t was t h e r e a s o n ? C apital 1 73 Q 2 A 3 74 Q 4 A 5 6 75 Q A 9 76 Q 11 A 12 That t h i s was a g o o d t h i n g t o do a nd i t And who a c t u a l l y Who w a s , if W ell, was s e t it e s t a b lis h e d the Trust you l i k e , the organiser f o r him? of it? up b e c a u s e o f a d v i c e t h a t he g o t Yes ? And p r e s u m a b l y G u i n n e s s & Mahon w e r e i n v o l v e d a s w ell. 77 Q 14 15 Yes ? f r o m S t o k e s K e n ne d y C r o w l e y . 10 13 ad visors. w a s . . . (INTERJECTION). 7 8 And he was a d v i s e d b y f i n a n c i a l A 16 Yes, Guinness w ith Guinness & Mahon a t t h a t He was i n t h e sense that realized 17 78 Q 18 A 19 & Mahon a s w e l l . in 79 Q 21 A Yes ? T he y d i d n ' t come t o g e t h e r b u t i t I think i t So, 24 w ith Guinness A 27 81 Q 28 A 29 82 Q they t o one a n o t h e r . was t h e m i d d l e o f 23 26 was j u s t Y e s? month or s o l a t e r . 80 Q were 1973. 22 25 stage? these prop erties occurred reasonably c lo s e 20 Was he d e a l i n g 1 9 7 3 an d may b e a T ha t was j u s t he ha d t h e m o n e y . a coincidence. He d e p o s i t e d t h e money & Mahon i n D u b l i n . And u l t i m a t e l y p u t i t into a Trust? Yes . Where was t h a t I t was i n Trust lo c a te d ; Jersey. do y o u know? 1 2 83 Q. 3 A. 4 84 Q. Yes. No, Yes, I t was n o t no. all righ t. A fter that 5 tim e to tim e i t 6 t o b o r r o w money? 7 A. 8 85 Q. 9 A. 10 11 Yes, the 12 On b o r r o w i n g s , A. 14 87 Q. 16 deposits 18 8 8 Q. 19 A. 20 89 Q. 21 A. 22 90 Q. 23 A. relied at th at from t h e T r u st? No. You do n o t re me mbe r t h a t I do reme mbe r t h a t at a ll? th e y w e r e n 't back t o back. T h ey w e r e n o t b a c k t o b a c k ? No. At a n y s t a g e ? No, the reason for that is 25 t r a n s f e r r e d through t h i s 26 th is 28 A. 29 92 Q. tim e l o a n s were g o t a nd b y t h e co mpa ny a nd a l s o b y b a c k i n g D i s c r e t i o n a r y T r u s t and i t 91 Q. o n . . . (INTERJECTION). & Mahon f o r v a r i o u s b u s i n e s s p u r p o s e s ? 24 27 car Do y o u reme mbe r t h a t t h e y w e r e g u a r a n t e e d b y in dividuals A. and t h a t a t t h a t t i m e was t h e yes. 15 17 company yes? Do y o u reme mbe r t h a t Yes, I p r e s u m e f r om became n e c e s s a r y f o r t h e B e c a u s e t h e main b u s i n e s s from G u in n e ss 13 tim e co mpa ny r e l i e d h e a v i l y on b o r r o w i n g s . ren tal business 86 Q. i n t h e Cayman I s l a n d s ? that it was - - was a t h e m on e y was Trust onto the S ettlor; g u y Woodward. Y e s? And i t Y e s? was m a n a g e d b y G u i n n e s s Mahon J e r s e y L i m i t e d . 1 2 93 Q I see? 3 A And H. F. Mur ra y ha d e f f e c t i v e l y 4 o w n e r s h i p o f t h a t money i n t o 5 is lik e 6 it was g o n e o u t o f h i s 7 94 Q 8 A Yes . 9 95 Q Yes. 10 11 all Out o f h i s these Trusts; transferred th is Trust. So, he r e l i e d t h e r e f o r e it on - ­ con trol. control? Of c o u r s e I understand th a t is the theory of it? A So , the Trust -- unless 12 H. 13 o f W i s h e s a nd s o on - - 14 then to 15 effectively 16 96 Q 17 A 18 F. Murray - - they got au th orization who p r o b a b l y h a d b e c a u s e he r e l i e d carry th o se out, he had l o s t on t h e th o se w ishes control of Letters Trustees out, of these f r om because funds. I see? So , unless he g a v e a u t h o r i s a t i o n t h e y c o u l d n ' t have a b a c k - t o - b a c k arrangem ent. 19 97 Q 20 A 21 98 Q 22 A 23 99 Q I see? And he d i d n ' t . I see. W e l l . . . (INTERJECTION)? A n d . . . (INTERJECTION). C ould I f i r s t of a ll 24 t h a t Guinness & Mahon h a v e t o l d u s t h a t d u r i n g t h e 25 1970's 26 t h e y had i n t e r n a l 27 A 28 1 00 Q 29 A Yes . and 1 9 8 0 ' s , e x p l a i n t o you, during alm ost a l l docum entation? Mr. C arroll, of th a t period, 1 1 01 Q. 2 A. 3 102 Q. 4 However, Yes. Where t h e y a d v a n c e d mone y a nd i t was b a c k e d b y funds ? 5 A. 6 1 03 Q. 7 A. 8 104 Q. 9 A. 10 1 05 Q. 11 A. 12 1 0 6 Q. 13 A. 14 107 Q. 15 A. 16 108 Q. 17 A. 18 1 0 9 Q. 19 A. 20 1 10 Q. 21 A. Suitably. 22 1 11 Q. Suitably? 23 A. 24 112 Q. 25 A. Yes. 26 1 13 Q. Y e s? 27 A. 28 29 d e a l i n g w i t h many o t h e r c o m p a n i e s ? By, Funds f r o m a b r o a d ? Oh, yes. I t was b a c k e d b y f u n d s Yes, yes, from abroad? yes. They u s e d a c o d e i n t h e i r Yes, docum entation? yes. Whic h s a i d t h a t I know t h e it w a s . . . ( INTERJECTION)? code. "Adequately secured"? Yes. Or " c o n s i d e r e d a d e q u a t e " ? Yes. Security Yes, " co n sid ered adequate"? or " c o n s id e r e d s u i t a b l y secured". C o n s i d e r e d . . . (INTERJECTION). Suitab ly secured. "Su itab ly secured"? We h a d a l l th is 114 Q. sorry? Y e s? all that out w ith Guinness & Mahon b e c a u s e a r o s e a b o u t t wo y e a r s a g o . 1 A. 2 Now, I w asn't i n t h e co mpa ny b u t I b e c a m e in volved because 3 1 15 Q. 4 A. 5 1 1 6 Q. 6 Yes. What I w a nt t o A. 8 117 Q. 9 A. I want t o Yes. s ho w y o u an i n t e r n a l memo f r om & Mahon? W e l l . . . (INTERJECTION) . Whi c h d e a l s w i t h t h a t Yes. W ell, I mean I c a l l 11 y o u know, 12 Perm anent/Guinness 13 th is 118 Q. 15 A. 16 1 1 9 Q. 17 A. For t h e i r Bu t i t 20 is 21 quite 22 put i t , 23 the 26 1 21 Q. 27 28 A. 29 122 Q. & Mahon, & Mahon s t a n d i n a l l of answer f o r t h e i r own s i t u a t i o n ? situation? m ak e s y o u w o n d e r b e c a u s e t h e y a r e r e s p o n s i b l e letter A. Permanent G u in n e ss I know t h e y d o . 19 25 Irish a nd I o f t e n w o n d e r w h e r e I r i s h Th e y h a v e t o for a l l 1 20 Q. the o f d e a lin g s w ith - ­ b u t . . . (INTERJECTION). 18 24 letter? we h a d t o l o t 10 14 show y o u n o w . . . (INTERJECTION)? Around t h e t i m e . Guinness 7 I had b e e n i n v o l v e d . of th is from t h e as fa r as Irish Permanent a t one s t a g e , some t i m e i n t h e l a s t sp ecifically that assignm ent of I can s e e b u t I have a year or so, t h e r e was n o , and i t an d t h e y s a y how d i d t h e y funds or a l e t t e r assigning fu n d s t o back any l o a n s . Y e s? S o, that is quite sp ecific. I see. You m i g h t g i v e u s t h a t , letter, if a copy o f th a t you h a v e i t ? Yes. I w o n d e r w o u l d y o u show Mr. C a r r o l l number 2 4 1 , 1 2 The o t h e r t h i n g a b o u t i t , 3 Guinness & Mahon w e r e q u i t e 4 w illin g, to 5 I understand th a t, 6 A So, we d i d n ' t 8 a nd i n 9 in Glenageary, need th e s e f a c t we, I think i t 12 also 13 for 14 f o r i n s u r a n c e premiums; 15 prem iums. late was £ 3 0 0 , 0 0 0 , 19 7 0 's or e a r l y 1980's & Mahon who f u n d e d t h a t funded s i g n i f i c a n t letters So , W ell, and i t and t h e y of guarantee F o r d M o t o r C r e d i t a n d t h e Bank o f Yes. some t i m e Ireland f o r payment o f i n s u r a n c e n o w . . . ( INTERJECTION)? i n o t h e r w o r d s t h e r e was a c r e d i t fa cility th ere. 1 25 Q However, Mr. C arroll, if b a c k g r o u n d w h i c h y ou t e l l 20 21 A 22 126 Q 23 A 24 127 Q 25 A 26 128 Q 27 A 28 129 Q 29 f u n d s o r Mr. Murray bought a p r o p e r ty out was G u i n n e s s 19 other t h e Group, 11 18 keen or funds t o borrow funds may b e i n t h e A anxious, other 10 17 that of course? need th e s e we d i d n ' t 124 Q is len d funds. 7 16 Judge, y o u h a v e an a c c o u n t a n c y m e . . . ( INTERJECTION)? Sorry? If y o u h a v e an a c c o u n t a n c y b a c k g r o u n d ? Yes . Whic h y o u t e l l me y o u h a v e ? Yes . As i n d e e d I h a v e m y s e l f ; Yes, certain ly, You w i l l b e w e l l refuse ever before I was a l a w y e r ? yes. a w a re t h a t b a n k s w i l l never a second or t h ir d backing fo r t h e i r loans? 1 2 3 1 30 Q 4 A 5 1 31 Q 6 A 7 132 Q 8 A 9 1 33 Q 10 A 11 134 Q 12 A 13 1 35 Q I f t h e y can t a k e it? T he y t a k e e v e r y t h i n g . T he y t a k e e v e r y t h i n g t h e y c a n g e t ? Yes, yes. A ll righ t. I see it I f you l o o k a t "GMI", E xhibit 1? there. Do y o u s e e t h a t there? Yes . This i s R ight, o n l y o n e o f a number o f o n e s ? right. 14 " S e c u r ity c o n s id e r e d adequate" 15 16 17 A 18 136 Q 19 A 20 137 Q 21 Can y o u s e e u n d e r " S e c u r i t y " there? I do. You c a n t a k e it t h a t t h e r e a r e many o t h e r e x a m p l e s of that? 22 A 23 138 Q 24 25 Yes . Yes . I am g o i n g t o g i v e (Same H a n d e d ) , A 26 you one o t h e r exa m ple; E xhibit number 2 43 2? I h a v e a s k e d a number o f - - I mean I am a w a r e o f th is . 27 139 Q 28 A 29 1 40 Q Y e s? And I a s k e d a number o f b a n k e r s w h a t d o e s t h a t m ea n. Y e s? 1 And t h e y c e r t a i n l y 2 back-to-back 3 1 41 Q 4 A 6 142 Q 7 say th at it meant funds. I understand th a t. is 5 didn't I understand th a t but t h i s w h a t we w e r e t o l d b y G u i n n e s s & Mahon? Yes . At t h e moment I am n o t s a y i n g w h e t h e r I b e l i e v e them or n o t? 8 A 9 1 43 Q 10 A 11 144 Q 12 A 13 1 45 Q 14 A 15 146 Q 16 A 17 147 Q 18 B u t . . . (INTERJECTION). However, A 20 148 Q 21 A 22 149 Q is Who i n G u i n n e s s A ll w ha t t h e y t e l l us? & Mahon s a y s t h a t ? right? I m e a n . . . (INTERJECTION). A ll right? This i s Yes, W ell, the Irish Permanent. I see? I don't know. Would y o u l o o k a t t h e d o c u m e n t w h i c h y o u h a v e t h e r e . Is 19 that it number - - 24 w h a t ? 242 . 24 2 a nd 2 4 3 , E xhibit 2? Yes . This i s a list d a t e d 2 4 t h D e ce mb e r 1 9 8 8 o f v a r i o u s 23 c o m p a n i e s a nd i n d i v i d u a l s , 24 out of the 25 that 26 t h a t t i m e t h e r e was b a c k i n g d e p o s i t s in respect 27 t h e b o r r o w i n g s o f t h e Mu r r ay Gr oup . I 28 t h i n k . . . (INTERJECTION)? 29 is copy th a t relevant which have been b lan k ed y ou h a v e l e a v i n g o n l y t h e o n e t o y ou i n i t , which shows t h a t at of 1 2 3 4 5 b u t we n e v e r h e a r d o f GMCT s o - ­ 1 50 Q 6 Yes. We w i l l aspect 7 A 8 1 51 Q 9 A 10 152 Q come b a c k t o t h a t . of the thing Forget th at f o r t h e moment? Yes . F o r g e t GMCT f o r t h e moment? R ight. Have y o u a n y comment t o make on t h a t ; 11 in 12 deposits? 13 f rom? 1 98 8 somebody s a i d your b o r r o w in g s were s e c u r e d by b a c k i n g Forget 14 A 15 1 53 Q 16 A I have, yes. 17 154 Q What i s it? 18 A 19 1 55 Q 20 A 21 156 Q 22 A f o r t h e moment w h e r e t h e y w e r e Yes . Have y o u a n y comment t o make on t h a t ? I think i t is You t h i n k i t incorrect. is incorrect? Yes . A ll right, I understand? I think they f e l t they - - if you want t o elaborate 23 a little 24 knowing t h a t 25 c o n t r o l l e d b y Mr. 26 c o n t r o l l e d b y hi m b u t t h e y r e a l l y w e r e n ' t u n d e r 27 his 28 You s e e . . . (INTERJECTION)? 29 b it: control T he y p r o b a b l y h a d t h e these deposits H. legally comfort of were t h e r e , w hich were F. Mur ra y o r i n d i r e c t l y s o . . . (INTERJECTION). 1 158 Q 2 A 3 4 But t h e y d i d n ' t h a v e t h e b a c k t o b a c k . . . (INTERJECTION). 159 Q Mr. C arroll, t h e y were e i t h e r 5 or t h e y were n o t 6 you say? 7 A 8 1 60 Q 9 10 c o n t r o l l e d b y hi m a nd w h i c h do I said le g a lly they w eren't Yes. from a p r a c t i c a l v i e w p o i n t However, he g e t h i s h a n d s on i t A 11 I suppose, of the 12 1 61 Q Yes, 13 A Yes . 14 162 Q 15 A 16 1 63 Q yes, Yes . I understand th a t. Would y o u s ho w Mr. (Same H a n d e d ) ? E xhibit And i t 22 at a d iffe r e n t 23 A Yes . 24 1 65 Q Yes. showing i t same t h i n g r e a l l y b u t t o you a s a d i f f e r e n t D i d y o u know t h e name, Mr. c omp a ny w h i c h was t h e o p e r a t i o n a l 26 Trust? 166 Q 29 A document time? 25 28 This i s 3? shows p r e c i s e l y t h e I am j u s t A C arroll Yes . 21 27 goodw ill I understand that? a 197 8 d o c u m e n t , 164 Q he w anted i t ? I understand that? 18 20 could Trustees. number 2 4 6 a s w e l l A if c o n t r o l l e d b y h i m. b u t he h a d t o r e l y on t h e 17 19 c o n t r o l l e d b y hi m C arroll, of the c omp a ny o f t h e Yes . I t was - W ell, w h a t was i t s name? when I s a y I knew I was a w a r e o f i t . 22 I 1 2 167 Q 3 A 4 168 Q 5 A Yes ? B u t I know f r o m t h e b i t of research Yes ? That t h e fu n d s went out t o t h i s 6 was t h i s g u y Woodward a n d h e l e n t 7 in terest free 8 t h e . . . (INTERJECTION). 9 169 Q 10 A 11 12 I have done. to -- the the S ettlor funds Sumac a n d Sumac was The o p e r a t i n g company? Was t h e o p e r a t i n g company u s e d b y t h e Trustees f o r . . . (INTERJECTION). 1 70 Q 13 Whic h I t h i n k was t h e n o r m a l p r a c t i c e used for th e se 14 A 15 1 71 Q Yes, things? for in v e stin g the A ll righ t. 16 Mr. C a r r o l l number 250 17 that, 18 A 19 172 Q 21 A 22 1 73 Q 23 funds, yes. I n t h o s e c i r c u m s t a n c e s w o u l d y o u show E xhibit (Same H a n d e d ) ? Do y ou s e e 4? Yes . H e re we come t o , connection; 20 t h a t was all if y ou l i k e , t h e Cayman I s l a n d right? R ight. You s e e t h a t th is is a sta tem en t o f Guinness & Mahon i n Dublin? 24 A 25 174 Q Yes . And I t h i n k i t d e a ls with the year 26 just year. 27 sign ifican t 28 was an amount o f m on e y on d e p o s i t , 29 was a p p r o x i m a t e l y £ 1 . 4 m i l l i o n . a typ ical about There i s 1986. 1986 b u t i t is nothing p a r t ic u la r ly You c a n s e e t h a t t h e r e which I th in k 1 2 1 75 Q JUDGE O'LEARY: Deutchmarks 3 I should say? 4 A 5 176 Q 6 Yes . And y o u c a n s e e t h a t t h e r e f e r e n c e second typed l i n e on t h e is: 7 8 "RE SUMAC" 9 10 A 11 177 Q 12 Yes . A p p a r e n t l y what h a p p e n e d i s that Sumac i n v e s t e d t h e mone y t h r o u g h t h e Cayman I s l a n d s ? 13 A 14 178 Q 15 A 16 179 Q 17 A Yes . Do y o u u n d e r s t a n d w h a t I mean? I do, yes. Yes. Have y o u a n y comment t o make on t h a t ? W ell, yes, I have. Its Guinness & Mahon a n d i t 18 is 19 Cayman T r u s t / C o l l e g e , 20 i n t e r n a l d o c u m e n t and I h a v e n e v e r s e e n t h a t , 21 E xhibit 22 1 80 Q 23 A 24 1 81 Q 25 A 26 182 Q 27 A 4, document. I am n o t s u g g e s t i n g Yes, 1 83 Q It g o e s t o G u i n n e s s Mahon Re Sumac. So, it is an s o . . . ( INTERJECTION). f o r a moment y o u h a v e ? I u n d e r s t a n d w h at i t You u n d e r s t a n d w ha t i t says. says? Yes . A ll right? I mean Mr. Mu r ra y w a s n ' t a w a r e o f t h a t b e in g w ith Guinness 28 29 an i n t e r n a l I do n o t account & Mahon. know w h at Mr. Mu r ra y was a w a r e o f r e a l l y . 24 1 2 Yes . 3 184 Q 4 A 5 W e l l . . . (INTERJECTION)? W ell, I c a n s a y w i t h c o n f i d e n c e t h a t he n e v e r heard of 6 1 85 Q 7 A "Ansbacher". Y e s? And i n c i d e n t l y 8 you m igh t 9 when - - 10 186 Q 11 A I never heard o f find su rp risin g, but "Ansbacher", which I on ly heard o f i t s o m e w h e r e a r o u n d t h e Mc Cr ac ke n t h i n g . I see? And my i n i t i a l r e a c t i o n was, "Oh, that is 12 t h e o n l y A n s b a c h e r I e v e r h e a r d o f was - - 13 was an A n s b a c h e r p r i v a t e b a n k w h i c h was e i t h e r 14 Baggot S t r e e t 15 187 Q 16 A And I t h o u g h t , "This bank i s 18 o f," 19 what I - - 20 W oodchester. 21 heard. 188 Q or Leeson S t r e e t . Yes. "God, th is Ansbacher. but o f course it is It so, is the I thought, o n l y o n e I know w asn't but th a t is absolutely b u t t h a t b a n k was t a k e n o v e r b y I -- y o u know I j u s t Do y o u reme mbe r t h e n t h a t subsequently some t i m e l a t e r 23 t h e b o r r o w i n g s w h i c h ha d b e e n f r om t i m e t o t i m e 24 n e g o t i a t e d w ith Guinness 25 process 26 A 27 189 Q 28 A 29 1 90 Q on Y e s? 17 22 there & Mahon w e r e i n t h e of being tra n sferred to IIB? Yes . Do y o u reme mbe r t h a t ? I do, yes. Do y o u reme mbe r t h e n e g o t i a t i o n s 25 th a t took place 1 2 With IIB? 3 1 91 Q 4 A Yes. W ell, 5 192 Q Yes. Were y o u i n v o l v e d i n t h o s e n e g o t i a t i o n s ? 6 A Yes, 7 Yes ? yes. I do t o a c e r t a i n I w asn't - - by a p e rson 8 1 93 Q 9 A 10 194 Q 11 A 12 1 95 Q in itia lly it yes, yes. was a r r a n g e d f r o m KPMG. Y e s? Who a d v i s e d u s t h a t th is fa cility was a v a i l a b l e . I see? And t h a t was t h e r e a s o n t h a t w e . . . (INTERJECTION). However, in 13 extent, d i d y o u g o and d i s c u s s it w i t h somebody IIB? 14 A 15 196 Q 16 A 17 197 Q 18 A 19 198 Q 20 A Yes . 21 199 Q Yes, 22 A Yes . 23 200 Q 24 A 25 201 Q Yes, yes. You w o u l d h a v e b e e n t h e Yes, f i n a n c i a l man a t t h a t stage? yes. Who d i d y o u d i s c u s s I think i t it with in IIB? was G e r r y Q u i g l e y . Gerry Q u igley? t h a t name i s F air enough. f a m i l i a r t o me; I w ill Gerry Q uigley? come b a c k t o t h a t in a second? Yes . However, in fairness t o y o u a n d t o make s u r e t h a t 26 you have a l l 27 l o o k a t number 178 a s w e l l 28 What I am g o i n g t o do w h i l e y o u a r e l o o k i n g a t t h a t 29 is the inform ation I would l i k e (Same H a n d e d ) , I am g o i n g t o g o o u t a nd g e t my g l a s s e s y ou t o E xhibit because 5. I 1 am s t r a i n i n g my e y e s t r y i n g t o 2 R ight. 3 Mr. 4 I want t o b r i n g t o 5 sta tem en t o f Guinness 6 document I ga v e you, 7 an i n t e r n a l 8 You may n o t b e t h e 9 is C arroll, see these things? b e f o r e m o v i n g on f r om G u i n n e s s your a t t e n t i o n document. an e x t e r n a l th a t here i s & Mahon l i k e E xhibit It is recipient document. 5. the It other is a c t u a l l y not o f t h e document b u t i t is is a statem ent 10 by G u in n e ss 11 held, 12 c u s t o m e r was G u i n n e s s Mahon G u e r n s e y L t d? 13 A 14 203 Q 15 A 16 204 Q a an e x t e r n a l d o c u m e n t . What i t & Mahon o f t h e i r & Mahon accou n t which th e y which a custom er o f t h e i r ' s held, a nd t h a t Yes . You s e e t h a t ? Yes . And y o u s e e t h a t v a r i o u s tran saction s took p lace 17 w h i c h a p p e a r t o b e p a y m e n t s o u t a nd t h e r e 18 f o u r i n n um be r . One i s 19 Trustees Trust o f £9 1 ,1 0 0 . 20 H.T. 21 per C o llege T rustees 22 of £91,100. 23 D -e-l-i-s-l-e 24 Ray C a r r o l l p e r C o l l e g e T r u s t e e s 25 the C ordier T rust. 26 tran saction s ? 27 Yes. I suppose t h e answer i s 28 don't z o n e i n on t h em a b s o l u t e l y 29 I do reme mbe r t h e m , Jessica t o H. Murray o f £ 8 1 , 9 9 0 . F. Mur ra y C o l l e g e L astly, P. Murray a s o f th e Bianca Trust The s e c o n d o n e was t h e Trust. The s e c o n d t o The n e x t t o A. as T r u s t e e s are D elisle £50,000 Trust; to as T r u s te e s for Do y o u reme mbe r t h e s e yes. "yes". I mean I s p e c i f i c a l l y but 1 2 0 5 Q. 2 Yes. Was i t m o ne y d i s t r i b u t e d out of the fund or something? 3 A. 4 2 0 6 Q. 5 A. 6 207 Q. Yes . To e a c h o f t h e That i s A ll f o u r o f y o u? right. righ t. The l a t e Mr. H a r o l d Mu r ra y g o t £ 9 1 , 1 0 0 . 7 Young Mr. Mu r ra y g o t £ 8 1 , 9 9 0 , 8 s o y o u n g now? 9 A. 10 208 Q. e v e n t h o u g h he i s No. 11 12 "A. P. Murray" who i s A. P. Murray? 13 14 15 A. 16 2 0 9 Q. 17 A. 18 2 1 0 Q. 19 A. Yes . 20 2 1 1 Q. Yes, 21 A. Yes . 22 212 Q. That i s W ife, Mr. Yes . M r s . Murray? a nd y o u r s e l f . 24 t h a n t he m? 26 2 1 3 Q. 27 28 29 You g o t £ 5 0 , 0 0 0 ? R e p r e se n tin g presumably th e a lesser A. F. M u r r a y ' s w i f e . yes? 23 25 H. in terest in the fund, if y o u had you l i k e , Yes . Presumably t h a t is was a n o t h e r r e a s o n A. fact that I mean t h a t is wha t i t was b u t i f for i t l e t me know? the reason, I know t h e £ 5 0 , 0 0 0 28 that is yes, there as you s a y but down t h e r e f o r me - ­ not 1 it 2 a nd £ 3 0 , 0 0 0 3 I didn't receive 4 a credit i n t h a t . . . (INTERJECTION). 5 214 Q. 6 A. 7 2 1 5 Q. 8 arose because A. 10 2 1 6 Q. 11 A. 12 217 Q. o f t h a t went d i r e c t l y it. into company the c om pa ny . I mean I d i d I s u p p o s e a s I understand? And t h e b a l a n c e However, really 9 I had a l o a n w i t h t h e as I got d ir e c t ly i n t o my own a c c o u n t . I s a i d t o you a t t h e in terested s t a r t we a r e n o t in your p r i v a t e affairs? Okay. It is not r e a l l y our problem ? Okay. What we a r e i n t e r e s t e d in i s th is you s e e : If 13 we h a v e e s t a b l i s h e d t o o u r s a t i s f a c t i o n , 14 h a v e e s t a b l i s h e d a nd o b v i o u s l y we h a v e t o t h i n k 15 about t h i s , 16 lik e, 17 A. 18 218 Q. 19 A. 20 2 1 9 Q. 21 A. 22 2 2 0 Q. Even t h o u g h t h e y d i d n o t 27 28 W ell, 29 "Ansbacher"? know i t , as you s a i d ? I . . . (INTERJECTION) . We may t h e n h a v e t o g o on a n d c o n s i d e r w h e t h e r four b e n e f i c i a r i e s were t h e m s e l v e s clien ts of Yes. Can y o u s e e t h e p r o b l e m w h i c h we a r e That i s A. you T h a t t h e mone y h a d b e e n d i v e r t e d t h r o u g h t he m? "Ansbacher"? 2 2 1 Q. of if Yes. 24 26 company Sumac a n d , we Yes. the A. the t h e T ru st were c l i e n t s 23 25 that if fa c e d with? w h e r e we a r e c o m i n g from? I can u n d e r s t a n d where you a r e coming from but I would s e e it totally d ifferent. 1 222 Q. 2 A. Of c o u r s e ? That i s made o u t t o - - I th ink in c o n tr a st to 3 the previou s 4 G u i n n e s s Mahon G u e r n s e y L t d . 5 sign ifican ce 6 accurate, 7 t o G M Cayman. 8 it 9 used th e se o n e y o u s h o w e d me i t have been a f t e r H. F. that I t h i n k you can t a k e i t 15 have had any knowledge t h a t 16 f u n n e l l e d t h r o u g h Cayman; c a r e fu lly that However, the fact 20 is 2 2 5 Q. 23 I mean must fact; that t h a t we w i l l y o u do n o t a p p e a r the -- to funds were b e in g do y o u u n d e r s t a n d ? Yes. w h e t h e r we l i k e 22 made o u t and y o u a r e n o t meek i n t h i s 19 A. Okay, as d e f i n i t e to have been, 21 is d a t e b e c a u s e . . . (INTERJECTION). 14 224 Q. one a p p e a r s Mu r ra y was a w a r e o f b u t i t note 18 it some o b v i o u s t h a t G u i n n e s s Mahon 13 A. it, is f u n d s i n a d i f f e r e n t m an ne r t o wh at 11 17 th is T he y m u s t h a v e - - certain ly 2 2 3 Q. if and I c a n ' t d i s p u t e 10 12 made o u t t o I think there in th at because seems t o be f a i r l y is is it t h e y were f u n n e l l e d or n o t . N ot t h i s f r o m Cayman £50,000; that a d if f e r e n t m atter a lto g e th e r ? Yes. However, do y o u s e e and we w i l l take a note o f th a t, a c a r e fu l note? 24 A. 25 2 2 6 Q. 26 A. 27 227 Q. T h a t was l a t e r . Yes, I presume i s was l a t e r on. I understand that? And w e . . . (INTERJECTION). However, 28 fu lly 29 fu lly: Mr. C arroll, in context I am n o t so as I can put t h e m a tte r s o yo u u n d e r s t a n d t h a t m a t t e r saying th at £ 5 0 , 0 0 0 m e ans y o u a r e 1 2 3 Oh, 228 Q 4 I know t h a t . I am s a y i n g t h a t t h e £ 5 0 , 0 0 0 m ean s t h a t one o f t h e r e a l b e n e f i c i a r i e s 5 A 6 229 Q of the you a r e Trust? Yes . And i f y ou a r e o n e o f t h e r e a l b e n e f i c i a r i e s 7 the t h e T r u s t was a c l i e n t of 8 " A n s b a c h e r " d o e s t h a t make y o u a c l i e n t of 9 "Ansbacher"? 10 A 11 230 Q T r u s t and i f Yes . Not b e c a u s e of th is £50,000 but because 12 one o f t h e r e a l b e n e f i c i a r i e s 13 Can y o u s e e t h e p o i n t 14 A I am s u r e t h e r e is come b a c k t o 16 least 17 t h e n . . . (INTERJECTION). 231 Q 19 A 20 it: Trust. in t h a t but I have to The T r u s t was n e v e r a w a r e o r a t the b e n e f ic ia r ie s However, of the you were I am m a k i n g ? a lo gic 15 18 of -- w ell, the b e n e f ic ia r ie s I suppose we w i l l I suppose the b e n e f i c i a r i e s ca ll t he m? t h e r e f o r e were n e v e r aware. 21 232 Q 22 A 23 233 Q 24 A 25 234 Q 26 A 27 235 Q 28 A 29 236 Q Y e s? But p r e s u m a b l y t h e T r u s t e e s Yes, t h e m s e l v e s were aware. I understand? B ecau se t h e y were a b l e t o u s e t h e s e I think I understand th a t funds. all? Yes . And r e a l l y the purpose o f t h i s is to understand i t ? R ight. C o u l d I l e a v e now G u i n n e s s Mahon b e h i n d and 1 h opefully i t w ill 2 them a g a in ? I am c o m i n g t o t h i s 3 You s e e w ha t s u r p r i s e s me, 4 situation 5 had t h e 6 W e l l . . . (INTERJECTION). 7 237 Q is that not be n e c e s s a r y t o Mr. C arroll, about th e you s a y t h a t Guinness & Mahon Almost w ith o u t your knowledge; 8 lik e 9 You d i d n o t a u t h o r i s e 10 Mr. 11 A 12 238 Q 13 A 15 239 Q 16 A 17 240 Q 18 A 19 20 Is That i s 21 22 A 23 242 Q 24 A 25 243 Q 26 A 27 244 Q a fair it we w i l l p u t i t summary o f t h e p o s i t i o n ? a nd y o u do n o t b e l i e v e correct, yes. And t h e y a r e t h e o n l y t wo p e o p l e who c o u l d h a v e That i s really? right. B e c a u s e you were r u n n in g t h e s ho w a t t h a t stage? Yes . And t h a t is I couldn't it 241 Q that facility? Murray s e n i o r a u t h o r i s e d i t ? authorised i t 14 IIB s i t u a t i o n . comfort o f the b a c k -to -b a c k that. r e fe r to the r e a lity ? -- I p erson ally w i t h o u t Mr. c o u l d n ' t have a u t h o r is e d M ur r ay . I know. However, process t o do i t ? you c o u l d have i n i t i a t e d the R ight. Yes ? W i t h o u t H. Yes, F. Murray's a u t h o r i s a t i o n , precisely. yes. I understand that? A u thorisation. I u n d e r s t a n d t h e way i t would have worked. If 28 you w anted t h a t t o be d o n e y o u w o u l d h a v e ha d t o 29 g o a nd c h e c k i t with the boss? 1 2 2 4 5 Q. I understand. It h o w e v e r m a ke s i t a little b it 3 h a r d t o a c c e p t t h a t when y o u c o n s i d e r t h e t e r m s o f 4 an i n t e r n a l 5 o f your lo a n a p p l i c a t i o n 6 to 7 part of i t 8 to 9 MS. 10 2 4 6 Q. 191, it IIB document w hich e x i s t s E xhibit 6. or n o t. a n y w a y. and t h a t I am n o t It is Give i t CUMMINS: s u r e w h e t h e r 192 i s not. It 188 t o 13 Mr. 14 A. 15 247 Q. 16 A. 17 248 Q. 6. We h a v e g o t a l o t And t h i s is (Same H a n d e d ) , o f docum entation, from IIB? You a r e p e r f e c t l y w e l c o m e t o r e a d t h e w h o l e t h i n g 20 turn to the hardly i s necessary. It is their and I w a nt p a r t i c u l a r l y second page, which i s 189? Yes. And y o u s e e 23 24 "Proposed S e c u r ity " ? 25 26 A. Yes. 27 28 29 gentlem an; Yes. o f your s i t u a t i o n 24 9 Q. 192 d o c u m e n t a t i o n we g o t 19 22 to the Yes. but i t A. not relev a n t C arroll? 18 21 is t o t h e g e n t l e m a n a n y wa y . Give i t 11 E xhibit a t p a g e 188 Okay. JUDGE O'LEARY: 12 is at th e tim e "The t e r m l o a n w o u l d b e s e c u r e d f o r p r i n c i p a l o n l y by a bank g u a r a n t e e assessm ent f o r you t o 1 a c c e p ta b le to IIB. T h i s w i l l be p r o v i d e d on b e h a l f o f a t r u s t c o n t r o l l e d by th e s h a r e h o ld e r s o f t h e c om pa ny , who h a v e a d e p o s i t o f a s i m i l a r amount." 2 3 4 5 Do y o u reme mbe r o f f e r i n g 6 Yes. 7 arrangement 8 out 9 251 Q 10 Yes, that t o t he m? I mean t h a t was t h e t e r m s o f t h e I suppose. f r om G u i n n e s s loan; We t r a n s f e r r e d t h e funds & Mahon a n d . . . (INTERJECTION). I u n d e r s t a n d t h a t a n d t h a t was t o b e d o n e a nd I u n d e r s t a n d t h a t ? 11 A 12 252 Q Yes . However, it was mo re t h a n t h a t . I mean i t 13 more t h a n j u s t 14 t h a t t h e b o r r o w in g would be b a c k e d by t h e 15 A 16 253 Q 17 A 18 254 Q 19 A 20 255 Q Yes, a nd t h a t a transfer of is funds? That i s yes. So, right, funds. funds? Yes . However, was t h a t 22 not back-to-back? in - - however, th e Guinness I t h o u g h t you & Mahon b o r r o w i n g was 23 A No, it 24 256 Q So, y o u s a y t h a t was a c h a n g e ? 25 A 26 257 Q 27 A w asn't. Yes . I see? T h a t was b e c a u s e t h e s e p e o p l e As y o u s a i d e a r l i e r 258 Q They a r e s a y i n g t h e i r b o r r o w i n g was t o b e b a c k - t o - b a c k ? t o l d me t h a t 28 was right. S ecu red by t h e 21 29 the E verything? looked for i t . they look for ev ery th in g . 1 2 259 Q 3 A A back-to-back Yes, H. F. Mur ra y g a v e a u t h o r i t y t o t h e 4 to 5 went t o , 6 was a d e f i n i t e 7 260 Q Yes. to allow , to give Kredietbank, a guarantee to back-to-back, Trustees where t h e funds IIB. that S o, yes. How d i d K r e d i e t b a n k come i n t o the situ ation ? You w e r e b o r r o w i n g f r om I I B ? 8 9 A 10 261 Q 11 A 12 13 give, fa cility ? Yes . And K r e d i e t b a n k i s a London b a n k a s fa r as I know? Th e y w e r e a D u t c h b an k I t h i n k b u t a n y w a y . . . (INTERJECTION). 262 Q 14 A Dutch bank. However, I t h i n k t h e y h a d a London branch? 15 A 16 263 Q 17 Oh, t h e y had, I think i t yes. was a London b r a n c h y o u w e r e d e a l i n g with? 18 A 19 264 Q 20 A 21 265 Q 22 A 23 266 Q 24 A 25 267 Q 26 A 27 268 Q Yes . When I s a y a London b a nk? Yes . I mean a b a n k i n London? Yes . I do n o t mean a London o r g a n i s a t i o n ? R ight. W i t h a h e a d q u a r t e r s i n London? Yes . In f a c t I t h i n k t h e y may h a v e some c o n n e c t i o n 28 w i t h I I B now b u t 29 time? I do n o t t h i n k t h e y d i d a t t h e 1 2 269 Q 3 Th e y w e r e j u s t that 4 A 5 270 Q 6 kind o f A 8 271 Q 9 R ight. How d i d t h e q u e s t i o n o f K r e d i e t b a n k g i v i n g t h e Because the Why K r e d i e t b a n k ? fu n d s were i n v e s t e d w i t h K r e d i e t b a n k . And who s u g g e s t e d t h a t t h e given? You d i d n o t s i t 11 o ffices w ere and s a y , 12 Lo ndo n c a l l e d 13 invest it No, was b e c a u s e A 272 Q 17 18 it c o u l d be down i n w h e r e v e r y o u r "I know a g o o d b a n k i n K r e d i e t b a n k a n d I am g o i n g t o there"? However, was i t anybody e l s e A 19 W ell, of the a s s o c ia tio n that IIB 273 Q 21 A 22 274 Q Yes, However, This i s 275 Q -- t h e y were v e r y c l o s e l y is I am p u r s u i n g t h i s . nothing, if im portant linked. you l i k e , This i s im portant. t o do w i t h y o u a t a l l . for a d iffe r e n t reason? Yes . What I w a n t t o 27 from G u in n e ss 28 relation sh ip ? A Could I I B a nd K r e d i e t b a n k . 24 26 you? I understand that? It A to have s u g g e s te d i t ? I can't 23 25 IIB s u g g e s t e d i t t h a t was t h e way t h e a r r a n g e m e n t was s e t up, Judge. 20 29 guarantee had w i t h K r e d ie t b a n k . 15 16 fu n d s w ould be i n v e s t e d w it h K red ietb an k so as t h i s 10 14 is right? guarantee a r ise ? 7 f r i e n d l y w i t h them; f in d out i s : & Mahon, You w e r e m o v i n g w i t h whom y o u h a d a g o o d 1 276 Q 2 And t h e r e a r e in 3 A 4 277 Q letters some v e r y p o s i t i v e we h a v e t o t h e m a n d a l l 6 one k in d or a n o t h e r ? 8 278 Q 9 A 10 279 Q 11 A 12 280 Q them b a c k - t o - b a c k R ight, And I am n o t c r i t i c i s i n g it 17 of i n a n y way? Yes . However, apparently the back-to-back p u t t i n g t h e m on e y i n D u b l i n ? 281 Q fa cilities yes. 14 16 and And t h a t was t h e a g r e e m e n t ? if A IIB, Yes . 13 15 that? And y o u w e r e m o v i n g t o a n o t h e r b a n k , you were g i v i n g A you s a i d Yes . 5 7 things you l i k e , t o b e a t arms l e n g t h . fa cility was, You w e r e n o t No. You w e r e p u t t i n g t h e mone y i n a n o t h e r b a n k i n England? 18 A 19 282 Q Yes . What I am s a y i n g t o y o u i s : You h a d no p r e v i o u s b u s in e s s w ith Kredietbank? 20 21 A 22 283 Q 23 No. You p r o b a b l y d i d n o t e v e n h a r d l y know o f t h e i r existence? 24 A No. 25 284 Q So, somebody s a i d t o you, "The p l a c e to put the 26 m o ne y , 27 c a l l e d K r e d ie t b a n k i n London." 28 y o u? 29 I c a n ' t b e a b s o l u t e l y s p e c i f i c b u t . . . (INTERJECTION). s o a s we c a n a r r a n g e t h i s 37 thing, is a place Who s a i d t h a t to 1 285 Q 2 A 3 286 Q 4 A 5 I t must be IIB . IIB, true. W ell, You c a n n o t re me mb e r who i n the person th at IIB? I d e a l t w i t h a n y w a y was Gerry Q u ig le y . 6 287 Q 7 A Gerry Q u ig le y , all right? B u t we d i d n ' t o r H. F. Mur ra y - - 8 f i n i s h e d w ith Guinness & Mahon: 9 sto p p e d our borrow ings from them. 10 288 Q 11 A when y o u s a y he Yes, Yes ? And b e c a u s e -- why d i d we l e a v e G u i n n e s s 12 at a l l 13 r u mo ur s a b o u t t h e 14 a nd s o f o r t h , that 15 H. a g a i n on p r o b a b l y a l o t 16 advice, 17 t o move t h e mone y e l s e w h e r e . 18 289 Q 19 A 20 290 Q 21 A 22 F. Yes, and t h e r e a s o n was t h a t M ur ra y, 291 Q 24 A 25 292 Q 27 A 28 293 Q 29 A & Mahon th ey w eren 't doing w e ll, of and fin an cial d e c i d e d t h a t he w o u l d r e q u e s t t h e Trustees I understand? I f . . . (INTERJECTION). And I h a v e no d i f f i c u l t y So, t h e m on ey was i n - - Yes. with th a t So , Y e s? A n d . . . (INTERJECTION). Yes, t h i s m o ne y . yes? he w o u l d h a v e t o l d t h e T r u s t e e s was. I understand? at a ll? s a y Sumac was t h e I t was a l w a y s i n Sumac, m on e y w h e r e v e r i t 26 & Mahon t h e r e w e r e some s o lv e n c y o f Guinness co mp a ny t h a t was i n v e s t i n g 23 we t o t a l l y to take the 1 294 Q 2 A And t h a t is 3 295 Q However, the w h at h a p p e n e d . fact that it went i n t o K r e d i e t b a n k 4 was a m a t t e r w h i c h was s u g g e s t e d , 5 been su g g ested to 6 A 7 296 Q 8 A 9 297 Q 10 A That i s Is right, that a fa ir you, by IIB? yes. summary o f t h e p o s i t i o n ? I think i t is, A ll right, fair enough? I think i t does s ho w a l s o , 11 saying that these 12 be o u t i n 13 298 Q 14 A so, yes. if y o u d o n ' t m i n d my f u n d s w e r e now s u p p o s e d t o "Ansbacher". Y e s? B u t we n e v e r h a d a n y c o m m u n i c a t i o n / c o r r e s p o n d e n c e . 15 We d i d n ' t 16 Cayman w i t h o u t . . . (INTERJECTION). 17 299 Q 18 A c o u ld o n ly have know t h e r e was s u c h a p l a c e as "Ansbacher" I t h i n k y o u h a v e made t h a t p o i n t v e r y f o r c e f u l l y ? I know b u t I think th is 19 t h a t H. Mur ra y w o u l d s i m p l y h a v e d e a l t w i t h 20 G u i n n e s s Mahon G u e r n s e y L t d , 21 c a lle d then. 22 300 Q 23 A F. illu stra tes to I t h i n k t h e y were Y e s? And i n s t r u c t e d t h e m o r a s k e d t h e m , r e q u e s t e d them, 24 to 25 Guinness 26 t o do w i t h G u i n n e s s 27 he n e v e r ha d - - 28 Jersey/G uernsey in d e a lin g with th e se 29 some e x t e n t do t h i s . He w a s n ' t g o i n g t o & Mahon i n D u b l i n . "Ansbacher" or He n e v e r h a d a n y t h i n g & Mahon i n D u b l i n o t h e r t h a n - ­ o t h e r t h a n G u i n n e s s Mahon i n funds. 1 name o f Cormac O ' R o u r k e i n 2 Yes . 3 302 Q Yes. In f a c t if 4 (Same H a n d e d ) , 5 p osition 6 A p p a r e n t l y Mr. 7 Crowley, 8 then, 9 of the 10 A 12 303 Q 14 A 15 304 Q 16 A 17 305 Q 18 A 19 306 Q 20 A 22 307 Q out the N i a l l O ' C a r r o l l o f S t o k e s Ke n n e d y seems t o o u t what t h e confirm the p o in t y o u made; that s u g g e s t i o n w i t h r e g a r d t o K r e d i e t b a n k i n London? Yes . Came f r om I I B ? Yes . Is that fair? Yes . A ll right, Okay. That i s o n l y b y way o f i n f o r m a t i o n yo u? Yes . I r e a l l y do n o t w a n t a n y comment f r o m y o u . as p o s s i b l e ? 308 Q sets is? 24 26 fact KPMG a s t h e y w e r e b e g i n n i n g t o b e known in A He i n I th in k reasonably c le a r ly th ere. 23 25 7? 1 1 t h No ve mb e r 1 98 8 h e s e t s And t h a t to 21 E xhibit C a r r o l l number 154 Yes . the 13 y o u g i v e Mr. was d e a l i n g w i t h y o u r a c c o u n t a nd i n a l e t t e r p osition 11 IIB? fairness you a r e e n t i t l e d I think t o a s much i n f o r m a t i o n R ight. Yes. This is 27 m atter th at 28 a nd t h e r e f o r e 29 lo o k at page a p e r ip h e r a l m atter but i t I may h a v e t o r e f e r t o I should put i t 182 in the t o you: (Same H a n d e d ) , is E xhibit If 8? a report you 1 2 309 Q 3 You w i l l the 4 A 5 310 Q see there that Irish Intercontinental And I t e m 3 o f t h e is 7 a copy o f th a t 8 a s k e d you t o g e t in 9 A Yes . 10 311 Q Yes. A 13 312 Q 14 15 fact letter 16 there, 313 Q 18 A secu rity. E xhibit 9. Do y ou h a v e I may n o t h a v e a copy o f th a t? the nature of the security, 9? Yes . It appears th a t Yes, yes, you f e l t that that issue s h o u l d be o m i t t e d S t o k e s Kennedy Crowley? I am s u r p r i s e d a t t h a t w asn't a b ig 17 to o f S t o k e s Kennedy Crow ley from t h e b a n k ' s r e s p o n s e t o A your l e t t e r Bank? the nature o f the Do y o u s e e t h a t ; E xhibit 12 is Yes . 6 11 that letter. I mean i t a n y way. Yes ? And w h a t n o r m a l l y h a p p e n s - - I just am s u r p r i s e d 19 how I c o u l d h a v e w r i t t e n t h a t 20 b e c a u s e what n o r m a l l y h a p p e n s i s 21 r e q u e s t s which were s t a n d a r d forms from your 22 auditors 23 to 24 so f o r t h . 25 314 Q 26 A to sign I know t h e And we d o n ' t E xhibit you g e t t h e s e and t h e y a r e s e n d i n g t h e m o f f your s o l i c i t o r s , Yes, letter, fin an cial in stitu tion s and system? s e e them a f t e r that. T he y go 27 d i r e c t l y back to th e a u d ito r s 28 w i t h them a c c o r d i n g l y . 29 I c a n ' t u n d e r s t a n d how I w o u l d b e i n v o l v e d i n S o, and t h e y d e a l I am n o t sure - ­ 8, 1 2 3 1 5 Q. 3 A. 4 5 Y e s? Bu t i t w asn't a b ig is s u e , Judge, a n d . . . (INTERJECTION). 3 1 6 Q. No, I am n o t m a k i n g a b i g bringing i t 6 to your a t t e n t i o n ? 7 A. 8 317 Q. That i s grand. 9 A. That i s about i t . 10 318 Q. And, Mr. i s s u e b u t I am j u s t yes. C arroll, just one s e c o n d i f 11 I j u s t want t o w h i s p e r i f 12 t h e r e may b e o n e t h i n g t h a t 13 A. 14 3 1 9 Q. 15 recall which i s t h e payment o f t h e £ 5 0 , 0 0 0 17 3 2 0 Q. 18 A. 17 8, yes. 19 3 2 1 Q. Yes, 178. If at a l l 22 we h a v e t o a t 26 29 5, to Mr. C arroll, y ou? that? if you l i k e , a nd t h e y may b e n o t h i n g t o do w i t h o u r s i t u a t i o n least o r t h e y may b e b u t r un t h e m p a s t y ou ? Yes. This C ordier Trust: Do y o u know a n y t h i n g a b o u t that? A. 27 28 E xhibit T h e r e a r e a number o f names t h e r e w h i c h 21 25 a t page 178, you m igh t g e t a r e new t o u s , 322 Q. a s k yo u a b o u t ? Yes. 20 24 I have t o You w i l l A. A. y o u do n o t m i n d b e c a u s e R ight. 16 23 you w o u ld n o t mind; No, I don't know a n y t h i n g a b o u t t h a t ; C ordier Trust, 3 2 3 Q. no. Did you have a T r u s t y o u r s e l f ? not about th e 1 have th e d e t a i l s 2 Jersey o r ig in a lly . 3 324 Q 4 A 5 6 o f t h e t a x p l a n t h a t was s e t up i n Yes ? I mean I h a v e an i d e a o f i t but I h a v en 't copy. 325 Q However, is it p ossib le that t h e r e was t h e 7 Woodward T r u s t a n d t h e r e w e r e , 8 su b sid ia r y Trusts 9 w h i c h was c a l l e d 10 A 11 326 Q 12 13 got a 14 you l i k e , sh ootin g out of th a t one o f th e C ordier Trust? Yes . The B i a n c a T r u s t , Jessica A if It is the D e lis le T r u s t and t h e Trust? p o s s ib le but I don't know i s the answer to that. 15 327 Q 16 A 17 328 Q 18 You do n o t know t h e a n s w e r t o t h a t ? No. Did you e v e r g e t a payment from a t h i n g c a l l e d the C ordier Trust? 19 A 20 329 Q 21 No. O t h e r t h a n t h e £ 5 0 , 0 0 0 we a r e t a l k i n g about h e r e now? 22 A 23 330 Q No, Yes, no, no. or does it h a v e a n y f u n d s a t t h e moment? 24 y o u know a n y t h i n g a b o u t t h a t ; 25 existence 26 has f u n d s a t t h e moment? 27 No, I w o u l d n ' t be aware o f i t . 28 T r u s t s were t h e r e 29 t h e y a r e as you s a y s u b - t r u s t s som ething c a l l e d whether t h e r e is Do in t h e C o rd ier T rust which I mean i f those I mean t h e y a r e o b v i o u s l y - ­ or so m eth in g . 1 3 31 Q 2 A 3 3 32 Q 4 A 5 333 Q 6 A 7 334 Q 8 A 9 335 Q 10 A 11 336 Q 12 A 13 337 Q 14 I f th ey were. Yes ? Th e y a r e a l l . . . (INTERJECTION). Have y o u a n y i n t e r e s t now a n y way? No. None a t a l l ? Not a t a l l . Yes ? B u t . . . (INTERJECTION). It is a b it strange, Those T r u s t s were a l l It is a b it y o u know? -- t h e y were a l l wound u p. s t r a n g e t o have s u b s i d i a r y T r u s t s , if you l i k e ? 15 A 16 338 Q 17 A 18 339 Q 19 A 20 3 40 Q 21 A 22 3 41 Q 23 A 24 3 42 Q 25 A Ye s . 26 3 43 Q Yes? 27 A 28 29 in i t Yes, yes. D i d y o u e v e r h e a r o f a n y o f t h e na me s ? No. Jessica? No, no. D elisle, Bianca or Cordier? No. You n e v e r h e a r d o f t hem? No . However, y o u d i d h e a r o f Woodward T r u s t ? B u t t h e Woodward T r u s t was wound up i n , it 344 Q yes, was, Yes? 1993. whenever 1 2 3 4 5 Q. 3 A. 4 5 Y e s? S o, if th o se T rusts did e x i s t t h e y were a l l t h e y w o u l d h a v e b e e n wound up a s w e l l p r e s u m a b l y . Can I t a k e it 6 first f r o m I I B was a t t h e e n d o f 7 b eginning o f 3 4 6 Q. 8 A. Yes, 9 347 Q. Yes. 10 loan that A. 12 348 Q. 13 A. 14 3 4 9 Q. 15 A. 16 3 5 0 Q. 17 A. 18 3 5 1 Q. 19 A. 20 352 Q. 21 A. Do y o u know t h e p r e c i s e Of t h e 24th A p ril T h a t may n o t h o w e v e r I t was a r o u n d t h a t 354 Q. ...(INTERJECTION)? tim e. I think i t was May 1 9 8 9 . Y e s? I am n o t a b s o l u t e l y A ll righ t. I think i t took a w hile to arrange the th in g . To a r r a n g e , I think i t sure. Y e s? yes? started the in - - the towards the funds - - w ell, end o f H. F. 1988. Murray f u n d s . . . (INTERJECTION). Do y o u know b y a n y c h a n c e when t h e m one y was transferred 27 1989? Yes. wanted to g e t A. d a t e by any chan ce ? Yes. 23 26 1988 or t h e of offer? We w a n t e d t o g e t 25 i n which you t o o k your yes. 22 3 5 3 Q. the date 1989? I have a l e t t e r 11 24 -­ into Kredietbank? I t w o u l d h a v e b e e n t h e same t i m e . Yes. Would i t 28 1989; that 29 be im p o r t a n t have been in e a r l y 1989 or l a t e c o u l d b e an i m p o r t a n t p o i n t ? f o r us t o know w h at p a r t o f It could 1989 t h a t 1 2 A. 3 3 5 5 Q. 4 A. Yes. 5 3 5 6 Q. Yes, It would have b e e n e a r l y E a r l y 1989? all righ t. 6 us p r e c i s e l y 7 have t h a t 8 letter 9 A. 10 357 Q. 11 1989. I am s u r e the date o f the on t h e i r A. 13 358 Q. 14 A. 15 3 5 9 Q. r e c o r d s any way. The y w i l l We h a v e a Yes. However, I do n o t h a v e t h e a c t u a l d r a w - d o w n d a t e Yes. Do y o u u n d e r s t a n d w h at I mean? Yes, yes. That i s grand. M s . Mackey? 17 MS. MACKEY: I h a v e no f u r t h e r q u e s t i o n s . No, 18 I have none e i t h e r . Thank y o u . 3 60 Q. JUDGE O'LEARY: Mr. C arroll, t h a n k you v e r y much i n d e e d ? 20 21 A. 22 3 6 1 Q. 23 Yes. Thank y ou f o r y o u r h e l p an d a s s i s t a n c e g r ea tly appreciate A. 25 362 Q. 27 A. 28 Am I a l l o w e d t o say no? You c a n s a y a n y t h i n g y o u w a n t ? Yes. Mr. 3 6 3 Q. a n d we it? Bu t c o u l d I s a y s o m e t h i n g ? anything; 26 29 loan. of offer? 16 24 first of the note? 12 19 IIB w i l l be a b l e t o t e l l Y e s? I knew - M ur ra y , H. I got to F. M ur ra y , know o b v i o u s l y t h e very w ell. late 1 2 364 Q. 3 A. Y e s? And h e was an e x c e p t i o n a l man. He s t a r t e d f r om 4 nothing. 5 1930's. 6 t h e war t o g e t p e t r o l a nd s o 7 h it 8 he was a v e r y c a p a b l e p e r s o n . 9 a nd a t t h e same t i m e a v e r y w e l l b a l a n c e d man a n d he He s t a r t e d a h a c k n e y b u s i n e s s He w e n t i n t o the the in the funeral business during f o r t h and t h e n r e a l l y j a c k p o t when he s t a r t e d t h e car r e n t a l but He was f u l l of ideas 10 was a l w a y s c o n c e r n e d , 11 I th in k of having - - m ain tain in g proper v a lu es 12 standards and t h i s is y o u know, a nd v e r y c o n s c i o u s and t h e t y p e o f man he w a s . 13 14 So, 15 a nd i n t h e 16 b usiness 17 He was t h e first 18 airports. He was t h e 19 forth 20 was e q u a l t o t h e b e s t 21 d i d t h a t v e r y q u i c k l y a nd i t 22 of the he was a p i o n e e r i n t h e Irish -- to u rist business. he was f i r s t and h e s e t Irish car r e n ta l b u sin ess to The c a r r e n t a l in the car r e n ta l b u sin e ss. s e t up c a r r e n t a l d e s k s a t t h e first to start l e a s i n g a nd s o up a s t a n d a r d f o r c a r r e n t a l international that s t a n d a r d s a nd h e b e c a m e an i n t e g r a l p a r t to u r ist bu sin ess. 23 24 He was a l w a y s 25 b usiness. 26 conventions in volved in the Irish to u rist He was a t t e n d i n g t h e s e intern ation al e v e n b e f o r e Bord F a i l t e . 27 28 He p r o m o t e d t h i n g s 29 up p r i z e s , pieces lik e golf 30 y e a r s ago. He s e t o f s c u l p t u r e by John Behan, every 1 year for o v erseas 2 c o n t r i b u t e d most t o groups or i n d i v i d u a l s Irish who golf. 3 4 He was o n e o f t h e 5 into 6 still Ireland innovators o f weekend shopping f r o m t h e UK a n d w h i c h much l a t e r was g o i n g on. 7 8 He c a r r i e d o u t p r o m o t i o n a l t o u r s 9 d ifficu lt 10 their years request, for the Irish i n t h e US i n T o u r i s t Board a t w h i c h was d o n e f r e e of charge. 11 12 He made a h u g e c o n t r i b u t i o n , as I say, 13 rental and t h e in d u stry. 14 rental i n d u s t r y n e v e r g o t any g r a n t s . 15 got in te r e s t 16 assistan ce 17 tou rist 18 S h a n n o n and t h i n g s Irish free tou rist loans. to both car The c a r T he y n e v e r T he y n e v e r r e c e i v e d w hich went t o o t h e r i n t e r e s t s industry such as h o t e l s lik e in the and b o a t s on t h e that. 19 20 He b u i l t 21 e m p l o y e d a b o u t 2 0 0 p e o p l e e v e n t u a l l y an d i t 22 fam ily b u sin ess 23 think th at 24 after 25 recogn ition 26 3 65 Q. Yes, 27 A. Yes. 28 3 6 6 Q. 29 up t h i s very su ccessfu l b u sin ess. t h a t h e h a d b u t he - - that business a b o u t 70 y e a r s is still I think - - is a fact I going strong it stands as o f w h at he d i d i n b u s i n e s s . t h a t may a l l However, is the He it be v e r y t r u e , Mr. C arroll? a n y t h i n g t o do w i t h o u r j o b ? 1 I am j u s t 2 t y p e o f p e r s o n he w a s . 3 367 Q 4 A tryin g to paint the p ictu re of the Yes ? He came a l o n g a n d he g o t t h e s e funds, most 5 unexpectedly, 6 was d u e t o h i s 7 th is mone y o u t o f t h e C o u n t r y a n d I j u s t 8 that it 9 a b s o l u t e l y w r o ng t h a t t h i s man who d i e d w h a t e v e r , is from t h e s e w i n d f a l l s fin an cial terrib ly advisors and he - - it t h a t h e moved s a d an d I t h i n k i t think is 10 five 11 a nd a s s o c i a t e d w i t h t h e 12 has happened through I t h in k a t e r r i b l e breach of 13 c o n f id e n t ia lit y because th ese t h a t have 14 go ne t o t h e m e d ia and t h e 15 from e i t h e r 16 Department or t h e T a o i s e a c h ' s or s i x 17 368 Q 18 A 19 369 Q 20 A 21 370 Q 22 A 23 371 Q 24 A So , I just 25 372 Q No, no. I think y e a r s ago - - "Ansbacher" being lin k ed f u n d s and t h a t are le a k s l e a k s m u s t h a v e come Gerard Ryan's Department, I could not get The T a n a i s t e ' s Department. i n v o l v e d i n t h a t now? I know y ou c o u l d n ' t . No, no, I am n o t g e t t i n g involved in that? I know y ou a r e n o t . No, no? But t h a t W ell, is Mr. t h e way i t is a n d w h y . . . (INTERJECTION). C a r r o l l . . . (INTERJECTION)? w a nt t o Mr. 26 there 27 in terview s 28 of those that 29 t h a t he i s say th a t. C arroll, for th is reason: I am g o i n g t o s t o p y ou During th e c o u r se we do n o t a l l o w p e o p l e t o are absent? o f our speak i l l 1 3 7 3 Q. 2 A. 3 374 Q. 4 A. 5 3 7 5 Q. 6 A. 7 3 7 6 Q. T h a t m ea ns I w i l l . . . ( INTERJECTION)? I w ill tak e th a t back th en . Y e s? I take th a t back. I w ill n o t a l l o w you you t o However, y o u c a n go o u t t h e d o o r c o n f i d e n t the 9 speak i l l A. 11 377 Q. 12 A. 13 378 Q. 14 A. o f t he m? Okay. 8 10 speak i l l knowledge t h a t Yes. I w ill n ot a l l o w anyone to o f you e i t h e r ? W ell, I w ill take th a t back. Do y o u u n d e r s t a n d t h e p o i n t Okay. I w ill I am m a k i n g ? take th a t back. Y e s? Bu t I w i l l just fin ish if I c o u l d t h e n and s a y i t 15 is 16 t h a t he s h o u l d b e a s s o c i a t e d w i t h t h e s e 17 a r e now l i n k e d w i t h s c a n d a l ; 18 evasion; 19 never even heard o f 20 now - - 21 Irish 22 outside 23 any more, 24 3 7 9 Q. 25 A. 26 3 80 Q. 27 A. 28 3 81 Q. 29 in dreadful and I t h i n k i t is w r o ng a n d i t is sad funds which w ith I suppose tax m one y w h i c h h a s n ' t b e e n d i s c l o s e d ; an d he "An sbacher" and t h a t he s h o u l d a man who made s u c h a h u g e c o n t r i b u t i o n society and I c o u l d t a l k of the b u sin e ss but Judge, to a b o u t what he d i d I w ill n o t b o r e yo u b u t I j u s t . . . (INTERJECTION). No? Bu t I j u s t f e e l . . . (INTERJECTION). I am h i g h l y c o n s c i o u s I just Yes, feel yes. terrib ly of the f a c t . . . (INTERJECTION)? st r o n g about th e whole t h i n g . I am h i g h l y c o n s c i o u s of the fact that 1 2 382 Q 3 person? 4 A 5 383 Q 6 A 7 384 Q 8 A 9 385 Q 10 11 A 12 386 Q 13 14 I w o u l d n o t a l l o w a n y b o d y s p e a k b a d l y o f an a b s e n t No, no, Wh o e v er t h e a b s e n t p e r s o n i s ? I am s o r r y a b o u t t h a t . Y e s? B u t . . . (INTERJECTION). And y o u c a n r e s t assured that anyone speak i l l of the R ight, but I notice -- 16 I even heard l a s t 17 s a y i n g . . . (INTERJECTION). 19 A 20 388 Q 21 A 22 389 Q 23 A 24 390 Q 25 A 391 Q 28 29 Mur ra y e i t h e r ? guarded i n s i d e I think leaks a nd may b e a p o l i t i c a l I t h i n k we w i l l a r e now culture and e v e n i n g Mr. M cC r ee vy call th is to a fin is h now? R ight. This i s finished? B u t do y o u k n o w . . . (INTERJECTION). This i s finished? B u t do y o u know w h a t he s a i d ? It is Okay. over? W ell, t h e n may b e I c a n t a l k to you c a s u a l l y a nd s a y . . . (INTERJECTION). 26 27 not allow room a s a n y b o d y ' s ? a culture 387 Q Mr. His r e p u t a t i o n w i l l be as j e a l o u s l y 15 18 late I w ill Yes . in t h is A I am s o r r y . No, I am n o t g e t t i n g involved. a l l o w e d you s a y a n y t h i n g a t a l l . A I sh o u ld not have Good l u c k ? 1 392 Q 2 A Thank you. MS. MACKEY: 3 4 Okay. A Thank you, Mr. Carroll. Thank you. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE EXAMINATION WAS THEN CONCLUDED. r (2a ^ r r Q S Wvr V5v>4\Xis \ % TwJu^ o\ t 1 A lt. j (^7 7 ^ * * * & • c ' Apmndixxvu44m,w, - AOORESS; BUSINESS/ OCCUPATION: c /o Murrays Europear L td., Baggot S tre e t Bridge. Dublin 4. Wholly owned subsidiary o f Murray L im ited. ' . THI8 APPLICATION ‘Exhtlnfl faelUdn ovarlmf (O tkutttfprapdaul Loan DM 743,726 AMOUNT. TYPE: Group Holdings CraUt MwnonndumpQiQ lU 8 fl8 Submitted by; No Equity Staka: C.B. Approval: Yw/Na Purmtaian Obtained Naw application °*“ ! ______ subm itted. RATE: C ost ♦ 3% - FEE: N“ f PURPOSE/DRAWDOWN: Working c a p ita l ■ - IfiMworkMnmd ' fmdlltitt, Udrawdown pvmitnd prior to comptnioA of tacurlty? already drawn Loan original!y taken up during 1982 x m a a n tx n/ a REVIEWDATES: TERM OP FACILITIES: E xtension fo r one year. 29th July 1988 SOURCE OF REPAYMENT: Cash Flow . ’ . SECURITY: G u aran tee o f M urray Group Holdings Ltd, S ecu rity considered adequate. ■ .‘ If additional or Mixing fadltty, li acurity Inonlirt . . ' YES/Mflt If No. ghM l,« i,a o o .o o ; o.oo o .o a i, * n .c a c . o o V •• sgfej* v •. §~;vcri'' =55£>S-.t'. !•« t* j s • » Wr c V &',*•«* V ■» • r Mum - GUINNESS+MAHONIID CoOM*n a Min Bnta flWMftau>/M944 v r bummfi *m m m iim ca. IIU1»/•!/*! m m IH M I H 1ALANCI 0I0IM4T 'TKUU r# aivfiti m n ^ - U «m i c*. JWfM LEDGER rOIMARO 000.00 7r447.»2 I1MARI0 m i m i »t*v . tIHUJO .4HM60 f« TO Hr HtUKAY P*« COLLCC* T/T I U T /T tft JlttlCA 1IUIT 1 fOI 1011 B9-4* Al .9010 . IMUI« m to nt mimav pia couc«i> tct * ST/IIM ro* Tut l l U t t l IM tt * * l»»* 90991»I9 AT .9010 IIMIID TR» TO AP »IMRAT M« COLL TRTt Al to m m 2INUI re* m oiakca ftuit i ** 101109-M A* .9010 r * r TO BAY CARI9LL F IX COLL T RITI AT • T / 1 U I *01 TMt COM I I I TIT 1 P»* M 4 9 J- 9 J AT .9010 aiMRao nnuiT ' 4/900.}1 ti/ia a .a o 11*990.00 *1,100.00 I• SCO.90 309*U9.»9OI 10l,9t0.l9»« I : U KIW M M » W — 11* U. J- CREDIT APPLICATION Background: .• " * ' The Murray Group ("Hurrays") waa started in the 1930's by H.F. Murray, now retired. The principle business was Initially the hire car business (with some chauffeur driven cars)* although they subsequently expanded into car ■ sales. ^ The current group structure is outlined in Appendix 1 (including trading) although there are only two principal trading companies, vizi • - Murrays Europcer Limited - Car hire - Esmonde Motors Limited - Car sales ‘ • . i Murrays held the Hertz franchise in Ireland for approximately 20 'years until 1972 when Hertz decided to set up their own organisation in Ireland. At this time they offered to purchase Murrays but the management wished to continue in business at that time. In 1973 Murrays entered a licensing agreement with Europcar/Godfrey Davis which is still in effect'. They currently have a five year agreement with Europcar until 1st Jenaury 1994. f’ *' • : ■5 . The referral o f 'business by Europcar is extremely important for Murrays accounting for approximately 4058'of total business. In addition, Murrays . .have .a three year contract with Aer Lingus to supply cars for their European fly/drive programme. This also leads to substantial volumes particularly in "off peak" .seasons when Aer Lingus ar.e actively pronoting vacant seats. . Flaat Movements: • Murrays traditionally start the year with 300/350 cars all less than a year old. Beginning in February/March this is built up to 800/850 cars by the end of June. Approximately 300 new cars are purchased while the balance are leased. Sales of the older cars commence in August/September end are disposed of by November/December. The year then commences again with a stock- of cars of approximately 300/350 allaof which would be less than a year old. . ■ • iff i ' ■ Murrays have a core borrowing requirement of approximately IR£1.2m which they have traditionally borrowed in currency. It i3 proposed to transfer thi3 from Guinness-4 Mahon who currently provide it. It is also proposed-to provide a short tern revolving credit of up to' IR£3m to be drawndown as indicated .in’ Appendix 2. ’This will be used for new fleet purchases and would be repaid in accordance with the schedule. As . indicated above this is a short term self-liquidating requirement. It -has ' traditionally been provided by Bank of .Ireland Finance. Existing Banking Facilities: The following facilities•are .available to Murraysr 1. Bank of Ireland - Overdraft Facility - IR£250k - Revolving Credit - IR£400k Industrial Credit Company - Tourism Loan -? IR£3Q0k Bank of Ireland Finance - Car Loans - Up to IR£2.5m. 2. 3. The Bank of Ireland facilities are secured’ by an equitable deposit of the title deeds to Haddington Road (value IEP 400kj premises and the guarantee of various group companies. ' . The Bank of Ireland Finance facilities are secured by a chattel mortgage over the cars financed together with a holding company guarantee. The ICC facilities are secured by 8 floating charge over Thomdene Investments Limited, a chattel mortgage over the -cars financed and a guarantee of Murray Group Holdings. The cars financed are owned by Thorndene investments. It is with a view to simplifying the above structure that IIB has an opportunity to provide the revolving credit facility. " Proposed Security: .The term loan would be secured for principal only by a bank guarantee acceptable to IIB. This will be provided on behalf of a trust controlled by the shareholde of the company, who have a deposit of a similar amount. . • • i \ q t Security Tor the short term revolving credit would be the guarantee of all group companies supported by fixed and floating charges on all assets of the group. While^he past the company ha3 provided chattel mortgages on the.cars financed,'given the short term requirements, the size of the fleet and the frequent sales and purchases this has proved administratively cumbersome and very expensive. Murrays, therefore, are currently seeking a bank who will provide the facility without the chattel mortgage requirement Trading: ' * Appendix 3 contains the consolidated profit and loss account for the group for the last two years. Pre-tax profit in the year to December 1987 amounted to IR£414k (1986: IR£172k) more than double that of the previous year. 1986 returns were depressed by the small number of Americans in Europe due to the Libyan crisis and the fact that Murrays did not have the contract with Aer Lingus that year. Interest cover in 1987 was 2.4 (1986t 1.66) a satisfactory level for what is essentially a short term leasing company. Management accounts for the year to 30th November 1988 Indicate a pre-tax profit of IR£408k (Budget: IR£320k) and the projected out-turn for the year is similar to 1987. 1988 has seen margins eroded but the Aer Lingus contract has increased.volumes significantly. An improved car market has seen Esmonde Motors performing well for the first time in many years. , Financial'Position: . ‘ The financial position as at 31st December 1987 (Appendix 4) shows a total net worth of IR£2.1m (1986»- IR£1.7ta) representing -3955S of total assets. The lqng term liabilities represent 71% of net worth but when deferred taxation is excluded long term debt amounts to' only 50# of shareholders' funds. Overall, the level of gearing is very low at year end in this company reflecting the cyclical nature of its fleet. At mid-year, both the inventory of cars and short term debt can be expected to increase by up to IR£3m. Nevertheless, this represents stock cover of 2 times. The stock would be readily saleable over a number of months and would be more than capable of repaying short term debt. Other current assets (IEP8Q0k) and fixed assets of IEP 1.2m provide significant additional security cover. -4- AsgBasnwtnt: This is a company with a long tradition in the motor industry in Ireland which has weathered the recession of the BO's very well. It has been well introduced to the bank via Stokes Kennedy Crowley', who are their auditors. Alex Spain has recently joined the Board of Murray Holdings, having been associated with the company for many, years. The proposal for the IR£1.2m bank guaranteed facility represents 8n attractive . return of 3/45 on what is-very limited risk. The risk on interest is limited as the structure can be collapsed at any time (KB London will earn VOJf W / i on the guarantee which is cash collateralised). . The proposal to finance short term car assets is well secured by stocks arid fixed assets and is inherently of a self-liquidating nature. IIB will have the right to inspect the very comprehensive fleet summaries which Murrays produce on a monthly basis. It will be possible to verify the location of any car in' the fleet and to inspect its tax book es these are ell held centrelly in head office. ■ The principel risks associated with the short term funding proposal are changes in excise duties end frauds Given the likelihood that any excise duty chenges will be signalled ini the Budget (in January - when stocks are at a minimum) and.the short term nature of the funding it is likely that the company will be able to take steps to ameliorate the effects of the * changes. ' In addition, the importance of the car hire Industry to tourism. ■ nay conceivably lead to special treatment as in the past. The size of the fleet makes the possibility of large scdle fraud unlikely. Any disposal of the fleet in excess of plenned level would have;the effect of reducing prices significantly in the market piece. ■ Overall, Murrays appears to be a tight well managed operation. They produce excellent fleet and financial management in a timely fashion within two weeks of month end. Having weathered the recession of the early 80's they are well poised to take advantage of the present upturn in the economy and the increased emphasis being put on tourism. The s tr o n g a s s e t cover and th e r e a d ily r e a li s a b l e n a tu re o f sto ck p rovide a s tr o n g b a s is fo r p ro v id in g the f a c i l i t i e s o u t lin e d . • / m ^ Bottowotj Murrays Europcar _App. No. 2803 Dale: 3 .2 . 09 (26) Purpose and Justification . • Purpose: . ' 1. Jo approve a new IR£1.2m equiv.' term loan facility; 2. To approve a new IR£3.0m equlv. revolving credit facility. . / j i • * Justification: 1. The term facility represents a good return on a bank guaranteed facility! . 2. The revolving credit is Justified by: ' (a) the strong asset cover (2.5:1) (b> the annually self liquidating nature of the transaction. . . (27) Guarantees and Collateral a). Existing — b) In process — • c) Proposed (Hew or d) Special Crcnriitiona/Covcnanta I - 1. Bank Guarantee acceptable to 118 (probably KB London) . Guarantee of-eHgroup companies r 2. aup^friusd^y first ^fixed and floating charge on all assets of the borrower shared pari passu with ICC in an amount of XR£300k.(to be negotiated) (28) Tenna and ccnditlcns ; 1. LIBOR + 3/ftS 2. DIBOR + RAC + 2* 2. :VlVT b* 6 f c jJ L u jt J r 'iu * . 0* e g A i f - M Vr t T l X us.t*f d t u v K t it * ,J - IW/ u f 3, SuWuJbt • t j a f I F i t e ■ J " OubCuAsLd u . f c t p ' u J t »«* . JAF/mb VI* TKLEWX D. Padrftlg fiollcry, Esq. Colnncao & Mahon Ltd. 17 College Green Dublin 2 IR E LA N D D*ar Padraig* F u r t h e r to yours of 7th October, I confirm you may fax letter and schedules as indicated to our audltora. Whilst not every balance agrees, wc are able bo reconcile the figures with our records. Regards, Tours sincerely! n f ' l«J.OKM 031 ■Oufftnw J ttio n w u u * « M >mnui• D f l T t : > ^ 0 C T - 1 i6s39 TlWEs ftP p»/i 002 TOTAL w-3* 0F i6t40 END* .. ■BhMSdjk m . . • ••*■ PPftK m a m js L V«t 03184093 03104173 03184283 wnpIVTMW 3 i >-v t- •*. 03184288 0211490? S 03184343 03194)91 03114371 03184990 03184384 03184403 A11«UM 03184484 03184433 03184440 03184491 03184909 03184848 03184883 03184742 s r DM \o f t ) ^ C ^ u .v *ma4 - c W U86 81,408,26 Appendix XV (145) Mr Liam Cassidy 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Liam Cassidy. a) Guinness and Mahon Credit Committee Minute o f 21 January 1977. b) Extract from Central Bank examination report o f Guinness and Mahon as at 30 April 1978. c) Guinness Mahon Cayman Trust/College Call a/c statement of 18 October 1985. Minute* of the 73rd Meeting of Hie Banking/Credit Committee held at 17 College Green, Dublin 2, on Friday, 21st1January, 1977. PRESENT: J. D. T. - M. E. O'K. - R. D. C. - GMcC. - P. J. F. - BMcL - t. W. K. - P. O'D. M. C. K. MONEY MARKET: Period rotasrapidly decreasing ahead of an ejected i% fall In M. L. R. FOREIGN EXCHANGE: The £ ttandsat 1.7150 against the U.S.$. ' 339: i . ■ Cassidy Silks Limited: Amount; £200,000 Purpose: Term: Acquisition of Intergroup properties*. Rate: Drawdowns 15% fixed By way of loan on 24th January, 1977 Security: Solicitors, Kenned/ & McGonagle, undertaking to hold Deeds One year annual review. offollowing properties to our order. Suitablysecured. 9 Lower O'Connell Street, Dublin 1. 73 Lower Georges Street, Dun laoghalre 78 Patrick Street, Cork Review: GUINNESS I LIHITED #3 APPENDIX 10 -m LOANS MCKED av who Ill rausr mums I ?In. 2 Louisiana Outstanding Mm 1973 Burmr Dgpos?lt Offshom Saunas! . {?me 31m. 7 - 1083.7? tU K m m +M iwtre ." *wr Ct l l M M t S S CALL A/C ■CT STERLING m H O H C A X H A H ACCOUNT a n a I* 1}CoHag•Snw OuMn 2 >O.Bo*SSATMMhanwftUJt** T9VJ4* JTaT6«5nT ho. l*ACf NO. i ACCOUNftUMMR OoMn«S« TRUST / COLLEGE . LEDGER • * iix P/C CALL 0 /« VWMMTI matiGULU* ■unMnun 1ICTI) CM Off *«6»2.S19.2S •UUUtCE &KOUCHT PORWARO CR.. INTEREST RATS CHANCED eXCH GUINNSSS N C T /COLL CXCH GUINNESS H'C T /COLL DEPOSIT ON POXNCIANA FUND OCPQSIT ON ROXHCXAMa RIRO RSR.~AOV . . . . US*TC:LIAH CASSIOY. 2 0 A T .i^ > 0 5 ^ -r.y ri", .. v i t O n^c-W eR A .C A S S iov za at — V G U IN N E S S + M A H O N LTD :r-4jWO.',»i*.. Kt-;> V i •• :excH:.cuiNNESS R c .t / colu rf€RrtAOV -> • . DEPOSIT :QFF‘ GUINNESS H C 2.0T3.99 2.073.99 T**,331.30 3«*'94Z.01 1 0 0 .0 0 Z.9S1.4* H.23 U.23 Hi5».T3 202*00 « ' *.*7S.6TU30 % 3t56T.09T.99 3 .3 & 4 « lia .a 9 169.03T.T5 3.6*9.*31.11 5 f s s .*** s N r r : ••• • . • •• ovtmuw*wunaiam mmud m . j .. S< '< j . j Appendix XV (146) College Trustees Limited 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to College Trustees Limited. a) Extract from ninth memorandum of evidence o f Ms Sandra Kells Channel Islands Operation. b) Extract of transcript of evidence of Mr Martin Keane dated 16 February 2000. c) Statements of account entitled GMCT re College Trustees. - EXTRACT FROM MEMORANDUM OF EVIDENCE OF SANDRA KELLS ENTITLED CHANNEL ISLANDS OPERATION change b ±-3 sterling rea in June 1972, Dublin recognised that very little new. business would flow from Creland. In Juiy 1973 it decided to open fully in Cayman and seek a new “A'’ licence. John Collins and John Furze joined C a y m a n from the 3ank of Nova Scocia in November 1973. Cayman became authorised dealers, with a full “A ” bank and crust company licence on 1st January 1974. A Category “A ” licence allows a bank to carry on business with residents and non-residents of the Cayman Islands. A Category UB ” licence for the m a m part restricts a holder to transactions with non-residents of the Cayman Islands. Cayman placed monies on deposit with Dublin. These were placed in Sundry Sub Accounts, which were general accounts through which monies moved, and other accounts in the n ame of Cayman, but which were designated by codes, numbers or initials and/or in the n a m e of different entities. Examples of such on accounts are as follows : (a) Guinness M a h o n C a y m a n Trust A/E - this deposit account had a $134,533.15 credit as at 16th June 1976. The Irish customer of Cayman, w h o placed monies on deposit with Cayman, also had companies in the Channel Islands, named Bella Investments Limited and Redshank Investments Limited. The A/E account was used, subsequently, as security for a loan to an Irish incorporated company, which was owned by the Irish resident. (b) A/A26 - this account was in Australian dollars and large sums of money moved through this account from the mid-1980’s onwards and, (c) a deposit opened in 1975 by C a y m a n was designated as a “G ” deposit. This deposit was used as security for a back-to-back loan to a company, Gombrette Limited, which was incorporated in the Channel Islands. CHANNEL ISLAN D S O PERATION With the shrinking of the sterling area in June 1972, C a y m a n became unavailable for use by residents of the scheduled territories. T o meet this position, Guinness M a h o n -Jersey Trustlimited formed in"Novem&w T97Tto”p r ^ d e an alternative offshore trust service. It was a wholly-owned subsidiary of Dublin. T w o of its directors were John Collins and John Furze. In the summer of 1973 it was decided that the Guinness M a h o n Group should have a bank in Guernsey. Guinness M a h o n Channel Islands was incorporated in February 1974 as a wholly-owned subsidiary of Dublin and, subsequently, obtained a banking licence. Due, however, to the downturn in the economic situation, it was decided to let the licence lapse. As a result of the decision to introduce a wide range of capital taxes in Ireland, the need for a separate trust company in Guernsey was recognised and College Trustees Limited was formed as a wholly-owned subsidiary of Guinness M a h o n Channel Islands early in 1975. John Collins was a director. With the change in the economic situation, it'was considered to be appropriate for the Group to have a bank in Guernsey. In February 1977 Guinness M a h o n Guernsey Limited was incorporated as a wholly-owned subsidiary of Guinness M a h o n & Co., Ltd. (hereinafter called “London”) and a banking licence was obtained. In summary, Dublin had two wholly-owned subsidiaries in die Channel Islands Guinness M a h o n Jersey Trust in Jersey and Guinness M a h o n Channel Islands in Guernsey, with College Trustees Limited in Guernsey being a wholly-owned subsidiary of Guinness M a h o n Channel Islands. Guinness M a h o n Channel Islands was, since the late 1970’s or early 1980’s, anon-trading company. Caym an was a subsidiary of Dublin, as were Guinness M a h o n Jersey Trust Limited and College Trustees Limited. Irish residents, if they were placing money offshore, m a y have placed it with College Trustees in Guernsey or with C a y m a n. The day-to-t> day running of College Trustees was provided by Sovereign Trusteed united. TEe directors of College Trustees Limited included Mr. John Lipscombe and a Mr. Brian EUis. They were also directors of Sovereign T^rste^ Limited. College Trustees was sold to Credit Suisse in. the late 1980’s. Monies could pass between College Trustees Limited and Cayman. Ca yman had accounts with Guinness M a h o n & Co., London. College Trustees could have placed monies in C a y m a n accounts via Guinness M a h o n Guernsey, which had a banking licence and had accounts with Guinness M a h o n & Co., Ltd., London. . ANSBACHER C A Y M A N Cayman had on deposit with Dublin on the following dates £Stg. 30.11.1978 31.12.1978 31VI:1979 29.2.1979 30.6.1979 31.8.79 30.9.1979 31.10.1979 31.12.1979 30.4.1981 30.4.1982 31.10.1984 4,834,269 4,493,397 4,319,118 4,498,471 4,812,438 6,498,101 6,880,600 6,896,908 7,424,612 9,396,537 26,980,217 25,154,068 Dublin is not aware w h y there was a significant increase in deposits with Dublin between 1981 and 1982, save that a substantial number of deposits were opened at that time by C a y m a n regarding College Trustees Limited. These accounts were in ’ UNDER OATH ON WEDNESDAY, 16TH FEBRUARY 2 0 0 0 I h e re b y c e r t i f y fo llo w in g th e t o be a t r u e and a c c u r a t e t r a n s c r i p t o f my s h o r th a n d n o te s in th e ab o ve named i n t e r v i e w . S te n o g r a p h e r MR. T he I n s p e c t o r s : JU S TIC E COSTELLO MR. ROWAN FCA MS. MACKEY BL S o lic ito r to th e In s p e c t o r s MS. M. CUMMINS In te r v ie w e e : MR. MARTIN KEANE In s tr u c te d by: MR. BOYCE SHUBOTHAM W illia m F ry S o lic it o r s F itz w ilto n House W ilto n P la c e D u b lin 2. FEBRUARY 200 0 MR. JU S TIC E COSTELLO: Good m o r n in g , my name i s a n d on my r i g h t M r. Rowan, is M r. Keane, D e c l# n C o s t e l l o M s. M ackey a n d on my l e f t is as you know we h a v e b e e n a p p o in t e d in s p e c to r s b y t h e H ig h C o u r t . s o lic ito r , M s. Cummins, to I w ill a s k now o u r a d m in is te r th e o a th to you. MR. KEANE, HAVING BEEN SWORN, WAS EXAMINED AS FOLLOWS BY MR. JU S TIC E COSTELLO MR. JU S T IC E COSTELLO: M r. Keane, I am s u r e your s o l i c i t o r h as e x p l a i n e d y o u t h a t we a r e tr ib u n a l, n o t a c o u r t a n d we a r e n o t a we a r e in s p e c t o r s a p p o in t e d b y t h e C o u rt. We h a v e a d o p te d t h e p r a c t i c e , s u re a p ro p e r p r a c tic e , th e is s lig h te s t, l e g a l a d v is e r s th a t th e m . s o lic ito r s is th e re a p o in t a t one w h ic h you s h o u ld is n o t be r e q u i r e d to a n s w e r, f o r one r e a s o n , e x a m p le t h a t is n o t r e le v a n t o r i t te rm s o f t h e C o u r t , a n d you c an d is c u s s If your s o lic ito r th in k s is t h a t we a r e q u e s t i o n w h ic h you a r e n o t r e q u i r e d fo r n o t w it h in you c an so i n d i c a t e th e m a tte r w ith in or If a q u e s t io n th e am we do n o t o b j e c t , t o w it n e s s e s b r i n g i n g w ith H ig h w h ic h I w h ic h y o u t h i n k it to to me your s o lic it o r . a s k in g a to a n s w e r, he 1 c a n so i n d i c a t e 2 ta lk 3 o p e ra te . to t o me and I you a b o u t i t . w ill That is s to p and h e c an how we p ro p o s e t o 4 i 5 I s h o u ld e x p l a i n , 6 r u lin g 7 th e 8 we r e g a r d 9 f o r r e a s o n s w h ic h you c o n s id e r v a l i d , as t o th e q u e s tio n , h o w e v e r, w h i l s t we c a rlh o t make a a d m is s a b ility , we may h av e t o re a c h a s it u a t io n y o u r d e c is io n n o t to 10 to a r e fu s a l to 11 th e n have t o 12 b e fo re 13 b e a d o p te d h e r e t o d a y . th e th e p r e p a r a to r y o f w h e re answ er th e q u e s tio n , as a m o u n tin g a n s w e r t h e q u e s t io n a n d we w o u ld c o n s id e r h a v in g t h e m a t t e r b r o u g h t C o u r t. T h at is t h e p r o c e d u r e w h ic h w i l l 14 15 M r. 16 in d ic a t e 17 q u a lific a tio n s 18 y o u r p r o f e s s io n ? 19 A. I K eane, it w o u ld b e h e l p f u l i f fir s tly t o me y o u r p r o f e s s i o n a l and b r i e f l y y o u r c u r r ic u l u m am a c h a r t e r e d a c c o u n t a n t and I 20 c h a rte re d 21 SKC as was i t a c c o u n ta n t i n 1972, in q u a lifie d w hat i s v ita e in as a now KPMG, known t h e n . 22 2 Q. S tro k e s K en n ed y C ro w le y ? 23 A. S tro k e s K en n edy C r o w le y . 24 3 Q'. 25 A. 26 4 Q. 27 A. In you c o u ld b r i e f l y when? 1972. You q u a l i f i e d ? I q u a lifie d 28 G u in n e s s 29 e x e c u t iv e . and I le ft SKC i n th a t y e a r and I & Mahon as a j u n i o r c o r p o r a t e I w o rk e d i n G u in n e s s jo in e d fin a n c e & Mahon fro m 1 97 2 1 u n til 2 I 3 a c c o u n ta n ts , 4 d ir e c to r 1988 when I le ft G u in n e s s h a v e b e e n e m p lo y e d b y E r n s t & M ahon. & Young, and my c u r r e n t p o s i t i o n o f c o rp o ra te f in a n c e S in c e 1 98 8 c h a rte re d th e re s e r v ic e s . is My c a r e e r 4 5 6 has b e e n i n 5 Q. We a r e c o rp o ra te fin a n c e , c o n c e rn e d now, 7 th a t is 8 w ith o b ta in in g 9 s e r v ic e s e s s e n tia lly . p a r tic u la r ly now known as A n s b a c h e r, w ith and we a r e fro m you a s s is t a n c e as t o w h ic h A n s b a c h e r o p e r a t e d h e r e th e in D u b l in 11 th e 12 w h ic h t h e A n s b a c h e r may h a v e b e e n t h e 13 m anagem ent com pany and how t h e w h o le s y s te m was 14 e s ta b lis h e d 15 us, I e s t a b li s h m e n t o f t r u s t s in and how i t th in k it w h e re r o u g h ly , 18 r e la tio n to 19 v a r io u s 20 o f th e b an k. 21 a ju n io r c o rp o ra te 22 d e a lin g s w ith 23 bank u n t i l , • th e re w a s, in o v e r t im e , say, I I ju s t my r o l e was i n and t h e jo in e d th e ban k in f in a n c e e x e c u tiv e . b e lie v e , e x is te n c e , G u in n e s s T ru s t, 26 L td ., 27 com pany w h ic h h a d b e e n e s t a b l i s h e d 28 name o f t h e 29 w h ic h was a t r u s t e e I G u in n e s s o f th e s ta g e & Mahon Cayman T h e re was a ls o in in (Caym an) J e rs e y a 1 97 2 b y t h e & Mahon J e r s e y T r u s t L t d . , com pany, w h ic h I as h a d no At th a t now known as A n s b a c h e r u n d e rs ta n d . 1972 o p e r a t io n s about 1974. 25 I or you c o u ld g i v e you i f any o f th e o f f - s h o r e w h ic h i s of c o m p a n ie s t h a t w e re s u b s i d i a r i e s As I I to re s p e c t tru s te e t h e w h o le A n s b a c h e r a f f a i r o ff-s h o re in and y o u r k n o w le d g e o f i t ? m ig h t be h e l p f u l t o o u tlin e d r e la tio n Cayman, w o rk e d and i f c o n s id e r a b le d e t a i l , 17 24 in in c o n c e rn e d I A. w a n t y o u r a s s is t a n c e com pany 10 16 p a r tic u la r ly th e came i n t o 1 c o n ta c t 1974. I 2 been e s ta b lis h e d in 3 o f G u in n e s s 4 b a c k g ro u n d t o 5 th a t 6 th e 7 s te r lin g 8 o u ts id e 9 p la c e in in th in k in & Mahon C h a n n e l I s l a n d s a ll o f t h a t w as, 197 2 t h e r e s c h e d u le d t e r r i t o r i e s , a re a th e s te r lin g 12 used, 13 r e g u la tio n s a n d he s e t u p , 14 s e tu p o f i t , a com pany i n 15 p u re t r u s t 16 J e rs e y T ru s t L td . 17 someone i n 18 d ir e c to r I 21 A. 22 7 Q. 23 A. 24 8 Q: 25 A. It of is Cayman w e n t Cayman h ad b e e n t h e known now as A n s b a c h e r was now n o t p o s s ib le excep t by v ir tu e com pany, fo r th is to I was n o t i n v o l v e d J e rs e y , He was a s s i s t e d t h e b a n k a t t h a t t im e , in w h ic h was j u s t b y t h e name o f G u in n e s s o f th e bank, be o f exchange c o n t r o l in th e a & Mahon t h a t by who was a l s o b y t h e name o f C h r is c o u ld i n t e r r u p t y o u , a tru s t 20 d e fin itio n T r a y n o r h ad e s t a b l i s h e d a s u b s i d i a r y Caym an. If The w h ic h made up t h e a re a . 11 It h ad u n d e r s ta n d i t , th e and my u n d e r s ta n d in g w h e re M r . a ls o L td . as I was c h a n g es i n on b e h a l f o f t h e b a n k , 6 Q. th e re G u e rn s e y a com pany b y t h e name 10 19 1974 a D odd. w h a t do you mean b y " j u s t com pany"? w a s n 't a b a n k , The f i r s t t im e r e a lly I it was j u s t a t r u s t e e came i n t o 26 e n tr ie s was i n 27 b a n k and I 28 M r. 29 Mahon J e r s e y T r u s t h a d , b e lie v e , I c o n ta c t w ith 1974. M r. th in k , in T r a y n o r had s u f f e r e d com pan y. any o f th e s e Dodd h a d l e f t th a t th e year a h e a rt a tta c k . a t th a t p o in t, a G u in n e s s & 1 c o n s id e r a b le num ber o f t r u s t s w h ic h h ad b e e n 2 e s ta b lis h e d in 3 s ig n ific a n t num ber o f c o m p a n ie s t h e r e 4 th a t 5 a s e c r e ta r ia t, 6 r e g is te r e d 7 th e 8 th in k 9 to t h e C h a n n e l Is l a n d s t im e G u in n e s s in o f th e th e y used l o c a l f o r m a t io n com pany was a t s e r v ic e s M r. 12 a d m in is tr a tiv e 13 to 14 make s u r e 15 s ta g e 16 a s i g n i f i c a n t num ber o f t r u s t s 17 e s t a b l i s h e d . . . (IN T E R J E C T IO N ). 9 Q. 19 A. a t th a t lo o k a f t e r th o s e re tu rn s w e re , I and I in J e rs e y an c o m p a n ie s file d lo c a l ta x e s . and to A t th a t rem em ber how many now, but h ad b e e n A p p r o x im a t e ly how many? I w o u ld s a y maybe 25 t o th e bank had, 21 w o u ld c a l l 22 s e ttle m e n t o r w i l l 23 w e re I r i s h • e s s e n tia lly w e re p r o p e r l y c a n 't The was a s k e d b y r o le , 20 24 s ta g e , in th e y p a id t h e i r th e re T r a y n o r 's go o v e r , to have and s e c r e t a r i a l t y p e 11 make s u r e t h e At th e house o f o f a c c o u n ta n ts s e r v ic e s . T ra y n o r to I, f ir m s 10 18 So, as w e l l . th e C hannel Is la n d s . son o f a f o r m e r c l i e n t - o f M r. s u p p ly w e re a & Mahon J e r s e y T r u s t d i d n ' t as s u c h , o ffic e and t h e r e fro m t h e D u b l in , o ld t r u s t s At th a t a la r g e o f th e s ta g e , k in d o f m a r r ia g e t r u s t n a tu re , Ir e la n d came i n t o in th e some o f th em w h ic h th e g a in s 26 Mahon E x e c u t o r and T r u s t e e Company, 27 have been th e 28 In 1974 c a p i t a l g a in s 29 in 1974 and a l o t to UK i n a lo t r e s id e n c e ' 6 0 ’ s when c a p i t a l 25 tru s te e a ls o , num ber o f w h a t I o t h e r s w h ic h had moved t h e i r UK t o ta x in 30. th e '6 0 s . Ir e la n d o f th e s e t a x was in t r o d u c e d o f th e s e t r u s t s G u in n e s s & w o u ld s e ttle m e n ts . to Ir e la n d w is h e d t o move 1 r e s id e n c e 2 s u ita b le 3 c a p i t a l g a in s 4 e v e n t, 5 i t i m e , w e re i n t h e p ro c e s s o f a p p ly in g f di a f u l l 6 b a n k in g 7 in c o r p o r a t e d 8 Mahon C h a n n e l I s la n d s 9 d e p a rtu re I 10 d ir e c to r s o f th e p a r e n t bank in 11 at one m e e tin g w it h t h e fin a n c ia l 12 e s t a b li s h m e n t o r r e g u l a t o r i n G u e rn s e y . 13 c o u rs e 14 up as a f u l l 15 out tru s te e s e r v ic e s . 16 o b ta in e d , b e lie v e , 17 th a t th e re 18 w h o le p r o j e c t was r e v ie w e d . 19 it 20 s e t up i n 21 e n v is a g e d a n d i t was d e c id e d n o t t o 22 T he l i c e n c e w a s, I 23 back to G u e rn s e y A u t h o r i t i e s . 24 10 Q-. 25 A. 26 11 Q. 27 A. y e t a g a in t o ju r is d ic tio n M r. ta x , — in o f a v o id in g my u n d e r s t a n d in g . So t h a t I I b e lie v e , at th a t G u e rn s e y b y t h e name o f G u in n e s s L td . in te n tio n bank in w as, Dodd, f o r a company w h ic h h a d b e e n was in v o l v e d i n th e o r some f o r t h e p u rp o s e s T r a y n o r and M r. lic e n c e le a s t is th e C hannel Is la n d s , I A f t e r M r. D o d d 's some m e e tin g s w i t h L ondon a n d I was t h a t th is In th in k due w o u ld b e s e t G u e rn s e y w h ic h w o u ld a l s o A b a n k in g l i c e n c e in 1974, th in k , s u d d e n ly lo o k e d l i k e & was d u ly how ever subsequent to a d o w n tu rn i n On t h e b e in g c a rry b u s in e s s , th e g ro u n d s o f c o s t s f a r m ore e x p e n s iv e t o G u e rn s e y th a n p e o p le h a d o r i g i n a l l y th e b e lie v e , p ro c e e d w ith it. r e lin q u is h e d and handed Do you know when was t h a t ? I th in k 1974, Yes, a p p r o x im a t e ly , as it end o f 1 9 7 4 . soon as t h a t ? c o u ld h a v e b ee n e a r l y 28 s itu a tio n at 29 dem and fro m t h e 1975. t h a t p o i n t was t h a t o ld t r u s t s So t h e th e re back in was t h i s D u b l in who w e re 1 s e e k in g a p e rm a n e n t e s t a b li s h m e n t , 2 p e r m a n e n t e s t a b li s h m e n t w i t h i n 3 b u t o ff-s h o re 4 h a d b e e n s e t up i n 5 p r e v io u s ly 6 a n y p e rm a n e n t e s t a b lis h m e n t o r s e c r e t a r i a t t o 7 a fte r to and t h e r e th e w e re t h e s e t h e b a n k h ad a s te r lin g c o m p a n ie s w h ic h J e r s e y and t r u s t s s e t up i n a re a , w h ic h h ad b e e n J e r s e y w h ic h r e a l l y $ i d n ' t a d m i n i s t e r th e m . have lo o k " 8 9 Among t h e s e o l d t r u s t s fa m ily , in w e re t r u s t s th a t I c o n n e c te d t o 10 G u in n e s s 11 G u in n e s s , 12 Mahon & C o ., 13 G u in n e s s 14 sequence o f e v e n ts , 15 p r o p e r m a n a g e rs i n 16 t h e y came i n 17 a c q u a in t a n c e , 18 tru s te e 19 S o v e r e ig n M an ag em en t, 20 tru s te e com pany. He h a d a good r e p u t a t i o n 21 a r is in g fro m t h i s v a r io u s m e e tin g s 22 in 23 M r. 24 in 25 o f C o lle g e T ru s te e s 26 w o u ld r e n t some s p a ce fro m M r . L ip s c o m b e ' s 27 o r g a n is a tio n 28 M r. James who was t h e n t h e C h a irm a n o f G u in n e s s & Mahon L t d . c a n 't w ith in to keen t o one o f t h e s e p la c e s a M r. and Joh n L ip s c o m b e who r a n a G u e rn s e y , by th e name o f w h ic h was a p r i v a t e l y th in k th a t s u b s e q u e n t ly i n and D u b l in w i t h & Mahon a s u b s i d i a r y b y t h e name G u e rn s e y , and e n t e r e d i n t o o r g a n is a tio n th e s e t r u s t s owned t o o k p la c e was d e c id e d t h a t G u in n e s s in have th r o u g h some m u tu a l D u b l in w o u ld e s t a b l i s h L ip s c o m b e 's rem em ber e x a c t l y t h e b u t t h e y w e re v e r y c o n ta c t, It I p la c e com pany i n T ra y n o r. & w h ic h was t h e p a r e n t com pany o f G u e rn s e y and I s e r v ic e s mean p r i m a r i l y M r . th e w h ic h s u b s i d i a r y a c o n tr a c t w ith to s u p p ly m anagem ent and com pany m anagem ent 1 s e r v ic e s . I 2 o ld th a t 3 had been e s t a b lis h e d 4 fro m G u in n e s s 5 & Mahon E x e c u to r & T r u s t e e 6 T ru s te e s tru s ts b e lie v e subsequent to w e re i n in D u b l in , th a t a lo t and th e o f th e tru s ts J e r s e y w e re a l l th a t tra n s fe rre d & Mahon J e r s e y T r u s t a n d fro m G u in n e s s 4 7 12 Q. J u s t so I u n d e r s ta n d , I th in k when you s a y " t r a n s f e r r e d " 9 was c h a n g e d t o A. I th in k th e tru s te e was c h a n g e d , b u t i n m ost c a s e s , 12 w h e re D u b l in was a t r u s t e e . The i n t e n t i o n as t r u s t e e 14 15 A. 16 14 Q. 17 A. 18 15 Q. Yes, w o u ld be C o lle g e And w o u ld a ls o We w i l l th a t 20 o ld It is th e a ll ones T ru s te e ? company m a n a g e r. la te r . you c a n n o t b e d e f i n i t e A. in a c t t o manage t h e t r u s t 19 21 tru s te e company t h a t w o u ld a c t c o m p a n ie s u n d e r ly in g come t o tru s ts , c le a r , may be n o t i n c e r ta in ly b e in g t h a t t h e a n d w o u ld a c t as t h e M anage t h e you made i t C o lle g e T r u s t e e s ? cases, 13 Q. C o lle g e you mean t h a t t h e 11 13 D u b lin t o as t r u s t e e . 8 10 in as w e l l ? th e t r u s t . J u s t a g a in , I am s u r e b u t j u s t how m any c o m p a n ie s , t h a t w e re moved fro m D u b lin ? n o t a la r g e num ber b u t t h e y w e re f a i r l y s u b s ta n tia l tr u s ts . 22 23 16 Q. 24 A. The nu m b ers w e r e n 't la r g e ? The num bers w o u ld n 't be l a r g e , s ix to te n , th e y 25 w o u ld be v e r y s u b s t a n t i a l and v e r y h e a v y fro m an 26 a d m in is tr a tiv e 27 h a v e h a d in v e s tm e n t p o r t f o l i o s 28 17 Q. 29 A. Yes. p o i n t o f v ie w , t h e y w o u ld p r o b a b ly and t h e lik e . C o n t in u e t h e n . My r o l e in t h a t p e r i o d was on t h e 10 in s tr u c tio n of 1 2 th e 3 tra n s fe r a n d lo o k i n g 4 th a t o v e r a ll a d m in is tr a tio n 5 th e 6 18 Q. 7 8 Yo u, o r g a n is in g o f a l l th e re tu rn s in th a t a t th e w e re f i l e d fa c t, and t h e o r g a n is in g o v e r a ll — o f th e m a k in g s u r e was up t o d a te i on t i m e . and k w e re a d i r e c t o r o f C o lle g e T ru s te e s , o r ig in a lly ? A. 9 A t th e d a te o f in c o r p o r a tio n , in c o r p o r a tio n , fo r 10 11 19 Q. 12 A. I p u r e ly a t checked t h a t and I was n o t , p u r e ly t h e p u rp o s e o f i n c o r p o r a t i o n . T h a t e x p la in s T h at is it. C o n tin u e t h e n M r. t h e p o i n t a t w h ic h a l l K eane. th e C hannel Is la n d s 13 a c tiv itie s 14 w h ic h I 15 C hannel Is la n d s . 16 G u in n e s s & Mahon D u b lin owned one h u n d re d p e r c e n t o f 17 G u in n e s s & Mahon C h a n n e l I s l a n d s , 18 owned one h u n d re d p e r c e n t o f C o lle g e 19 h a d a m anagem ent a rr a n g e m e n t w i t h 20 th a t 21 b e e n s e t up i n 22 th e 23 n o rm a l s t r u c t u r e a p p e a re d t o was a t r u s t an u n d e r ly in g 24 ' came t o g e t h e r u n d e r C o lle g e T ru s te e s t h i n k was a s u b s i d i a r y o f G u in n e s s tim e , So we now had t h e m ost o f t h e c lie n t s itu a tio n w h ic h i n w ith c o m p a n ie s t h a t h ad have been t h a t com pany. 26 C h r i s t o p h e r Woodward as t h e 27 g e n tle m a n whose ho u se was u s e d as t h e 28 o ffic e , 29 who was a d i r e c t o r it, in th e th e re M ost o f th e J e r s e y h ad s e ttlo r , fo rm e r c l i e n t o f G u in n e s s D u b l in came a c r o s s tru s ts son o f t h e w h ic h At 25 th e tu rn S o v e r e ig n . when I t h a t h ad b ee n s e t up i n w h e re T ru s te e s , J e r s e y h ad d e p o s it s b a c k i n name o f t h e n o rm a l — & Mahon who was t h e r e g is te r e d o f M r. T ra y n o r, & Mahon J e r s e y T r u s t . 1 So th o s e c o m p a n ie s h a d d e p o s it s b a c k w i t h 2 Mahon i n 3 20 Q. 4 A. 6 2 1 Q. 7 D u b l in . you j u s t tru s t 5 ta k e A. 9 22 Q. 10 A. 11 23 Q. 12 A. 13 it a little h ad u n d e r ly in g s lo w ly . You s a y t h e c o m p a n ie s . Yes. ' Was i t th e t r u s t s o m e th in g l i k e 8 14 If G u in n e s s j u s t owned one h u n d re d s h a r e s t h a t o f th e or company? Yes. A l l th e In th e fu n d s w e re i n company? com pany. And t h e Yes, th e com pany t h e n m anaged t h e th e fu n d s ? com pany p la c e d them b a c k on d e p o s i t w i t h D u b lin . 24 Q. 15 16 A. 17 25 Q. 18 A. T h at is w hat I w ant to p la c e d b a c k i n D u b lin ? My r e c o l l e c t i o n In is get a t. 19 th e 20 u n d e r ly in g The u n d e r l y i n g company? 22 A. The u n d e r l y i n g com pany. 23 27 Q. 24 • 25 A. N o, is th a t in d iv id u a l com pany. 26 Q. come t o a c c o u n ts , my r e c o l l e c t i o n t h e name o f t h e 21 We w i l l fu n d s fu n d s p la c e d ? a t th a t p o in t, fu n d s w e re i n th e yes. whose name w e re t h e The f u n d s , W ere a l l th e s e la te r . T h es e w e re t h e coded w e re th e y ? a t th is 26 in v e s t m e n t s , 27 com pany. p o i n t t h e y w e re j u s t X , w h a te v e r , 28 28 Q. O f th e company? 29 A. O f th e com pany, yes. th e Y, Z a c t u a l names o f t h e 1 29 Q. 2 3 A. 4 30 Q. A. 7 was he? T h at is my memory o f t h e D id y o u see who t h e W oodward t o Not i n i t i a l l y , c lie n ts be t h e I 31 Q. 9 A. 10 32 Q. Yes. My memory i s 12 w e re d e a l t I c a n 't b its 15 33 Q. 16 A. w e re who i n s t r u c t e d 4t.- becam e a w a re o f some o f th e m as " yes. If to g iv e as t o how t h e e x a c tly s a y how I becam e a w a re fro m v a r i o u s o f in f o r m a t io n . I th in k th e n , M r. a t p o in t — 18 about 1974 t o 19 p e r i o d when a l l 20 Mahon C h a n n e l I s l a n d s , 21 th in k 22 in 23 I I th in k th is Keane. some p o i n t a f t e r d u r in g t h a t p e r i o d , w h ic h i s about 1976, th a t r o u g h ly 1 9 7 5 /7 6 is th e s e t tin g up o f C o l l e g e . J e r s e y a n d t h e y may h a v e b e e n a d d e d t o th in k th e re was a c e r t a i n th e 35 Q. c o m p a n ie s t h a t h ad b e e n fo rm e d b y M r. s ta b le , W hat f u n c t i o n W hat f u n c t i o n ? Yes. I if tru s t. am ount o f s h e l f T ra y n o r, J e rs e y A. & some m ore c o m p a n ie s may h a v e b e e n i n c o r p o r a t e d 26 28 I th e was g o in g on a b o u t G u in n e s s t h e r e may h a v e b e e n some c o m p a n ie s a d d e d t o 34 Q. — fro m 25 27 fu n d s w it h ? you c o n t in u e So, in s tr u c tio n s th in k • th e s e came a c r o s s . s e ttlo r ? 17 24 a ll You becam e a w a re o f who t h e b e n e f i c i a r y was a n d who was a b l e 14 in W ere t h e s e d i s c r e t i o n a r y t r u s t s ? 11 A. s e ttlo r ones I t im e w e n t o n . 8 13 Woodward was t h e tru s ts , M r. 5 6 V e r y w e l l M r. you l i k e . w o u ld t h e y h ave? th e so 1 A. T h e y w o u ld be f o r fu rth e r — 3 s h e lf ty p e 4 M r . W oodward a n d t h e r e may h av e b e e n c o m p a n ie s w h ic h 5 w e re s u b s e q u e n t ly fo rm e d t o 36 Q. a v a ila b le 8 o p e r a tiv e ? 9 A. 10 37 Q. 11 A. w h ic h w e re w h e re t h e y w e re s e t up b y When you s a y " s h e l f " , 7 th e re th a t th e re tru s ts num ber o f t r u s t s is 2 6 w e re a l a r g e my r e c o l l e c t i o n go w i t h you mean t h a t th e m ! t h e y w e re t h e r e f o r a n y b o d y who w a n te d th e m , W e r e n 't o p e r a t i v e , t h e y w e re n o t yes. T h a t was b e tw e e n 1974 and 1976? I th in k th a t is my m em ory, been a llo c a t e d to 13 tim e . some t im e a ro u n d 197 6 M r . 14 d e c id e d t h a t he was t h e g o in g t o 15 in 16 in d iv id u a l 17 in d i v i d u a l d e p o s its . 18 w h e re b y fro m some d a t e a ro u n d t h e n t h a t 19 now c o d e d , 20 t h e b a n k b u t now known as G u in n e s s & Mahon C h a n n e l 21 Is la n d s 22 38 Q. D u b l in in A, r e la tio n to T ra y n o r change th e t h e d e p o s it s s till B, L td . C, th e He i n s t i t u t e d i n d i v i d u a l d e p o s it s D, o r w h a te v e r , in s y s te m th e a s y s te m , t h e y w e re on t h e b o o k s o f some n u m b e r. com pany was G u in n e s s & Mahon C h a n n e l was i t ? Yes. 24 A -. 25 39 Q. 26 A. In th e 27 40 Q. In t h e b o o k s o f t h e bank? 28 A. In th e 29 T ra y n o r a t t h a t c o m p a n ie s w h ic h w e re a p p e a r in g as The name i n Is la n d s 23 th in k b y M r. Some m o re may h a v e 12 I c lie n ts yes. T h a t was t h e name o f t h e d e p o s it o r ? th in k b o o ks o f t h e b a n k . b o o ks o f t h e b a n k , it was a c t i n g th a t is my m em ory, as a n o m in ee r e a l l y . yes. I 1 41 Q. 2 and t h a t 3 T ru s te e s ? 4 A. 5 42 Q. 6 A. 7 43 Q. 8 A. 9 44 Q. 10 A. T h a t 's had gone, c o rre c t, m ore o r l e s s , to fu n d C o lle g e yes. As t h e d e p o s it o r ? As t h e d e p o s ito r . So i f we h a d , le t 's 11 d e p o s ito r s 12 G u in n e s s & Mahon C h a n n e l I s la n d s A , in d i f f e r e n t names t h e y now becam e 13 45 Q. W it h t h e code? 14 A. W it h t h e code, 15 46 Q. 16 A. If I s a y 30 B, C. yes. you c o n t in u e t h e n . th in k , w h a t h ap p e n e d a f t e r t h a t , 17 t h a t th o s e 18 c lie n ts fr o m C o lle g e T r u s t e e s , t h e r e w e re some new 19 c lie n ts in t h a t p e r io d , 20 m id /la te 21 w o u ld h a v e b e e n in t r o d u c e d , 22 e x p e c t. 23 b u r e a u s y s te m was i n s t i t u t e d , 24 • 25 47 Q. d e p o s it s I th in k th e re some p o i n t a f t e r C o lle g e T r u s t e e s '7 0 's in w e re some new C o lle g e t o o k on new c l i e n t s A t some p o i n t , I la r g e ly , th in k , I th in k th a t It may h a v e b e e n i n s t i t u t e d , th e b u t we h a v e l e t t e r s 27 a n d a ls o M r. 48 Q. is c o r re c t d a te . L ip s c o m b e fro m t h e C h a n n e l I s l a n d s 29 I a ro u n d 1 9 7 9 t h e fro m M r. A. th e w h ic h b y D u b l in 26 28 in T h a t 's th e F u rze a t th e s ta rt same tim e ? o f t h e b u re a u s y s te m . in 1 97 8 1 A. 2 The b u r e a u s y s te m i s q u ite d iffe r e n t in th e sense t h a t . . . (IN T E R J E C T IO N ). 3 49 Q. 4 A. You p e r h a p s m ig h t d e s c r ib e My u n d e r s t a n d in g o f i t , I it to us now? w a s n 't i n v o l v e d in th e b u t my u n d e r s t a n d in g ofi-. i t was 4 5 s e ttin g up o f i t , 6 th a t 7 C h an n el Is la n d s 8 b a n k o f i n d i v i d u a l d e p o s it s , 9 D, th e , w h e re a s p r e v i o u s l y i n t h e y w e re a l l w e re " a w h o le s e r i e s a lb e it a m a lg a m a te d i n t o in th e coded A, B, one d e p o s i t , and 11 o n ly d e p o s i t t h a t was v i s i b l e 12 w h ic h h a d b e e n e n t e r e d i n t o 13 th e 14 d e p o s it s m a k in g up t h e l a r g e 15 m a in t a in e d on a s e p a r a t e 16 C o lle g e 17 a n d w h a t h as s u b s e q u e n t ly b e e n known as t h e b u r e a u 18 s y s te m , 19 h a v e b e e n M r. 20 a c c o u n ts 21 s u b s e q u e n t ly s u c c e e d e d b y M r. 22 p e o p le who had a c c e s s t o 23 e i t h e r M r. 25 26 tra c k in g to and t h e w ith o f th o s e d e p o s it s , T ru s te e s and I w h ic h o n ly , a rra n g e m e n t, C o lle g e , th e w o u ld be s y s te m b y D u b l in s im ila r ly th in k , was t h a t u n d e r ly in g d e p o s it, b e lie v e I was t h e a t th a t fo r f o r Caym an, t im e it may Ru L e o n a rd who was t h e m a n a g e r o f t h e d e p a r tm e n t i n L e o n a rd , s u b s e q u e n t ly M r. access to 50 Q. o r d i n a r y books o f t h e b a n k , C, th a t, • th e case o f th e 10 24 in th e re th e th e la te '7 0 's , he was C o lle r y . The o n ly t h e b u re a u s y s te m w e re a t th e a p p r o p r ia te C o l l e r y o r M r. t im e , T ra y n o r. I or h a d no it. B e fo re t h a t , h o w e v e r, you seem ed t o have been th e 27 p e r s o n who h ad a c c e s s b e c a u s e we h a v e a n o te 28 le d g e r s a y in g t h a t 29 you? in fo r m a tio n on a c an b e s o u g h t fro m 1 A. Yes, M r. R yan , t h e a u t h o r is e d o f f i c e r , 2 up w i t h m e. 3 h a v e r a c k e d my b r a i n 4 w hat i t in 5 o u ts id e o f M r. 6 a c c o u n ts d e p a r t m e n t , 7 p e r s o n who c o u ld h a v e a c c e s s t o 8 m e. 9 51 Q. 10 A. 11 52 Q. 12 A. e ffe c t I had a c c e s s . w e re . T ra y n o r, And t h a t M r. A. At th a t In o n ly o t h e r t h o s e a c c o u n ts was f a c t had access? I knew who some o f t h e o f cases it was a r e f e r to when t h e b u r e a u s y s te m was and i t was M r. L e o n a rd a n d l a t e r C o lle r y ? is 22 m ost o f th e 23 t h i n k my r e c o l l e c t i o n • th e t h e GMCI on es? s ta g e a lo t 21 24 T ra y n o r, s itu a tio n . a lte r e d 17 20 e ffe c t, Yes? e s ta b lis h e d 54 Q. in th in k o r w h o e v e r c o n t^ s p lle d t h e o r M r. C h an n el Is la n d s , 16 19 L e o n a rd , and I th e n and I was s a y in g was t h a t , to M r. A. s in c e To t h e 14 18 on i t you i n c lie n ts 53 Q. am som ewhat s u r p r i s e d b y i t W h a te v e r t h e n o te s a i d , 13 15 I b ro u g h t t h a t t h a t M r. L ip sc o m b e s t a r t e d Ir is h c lie n ts , is , to d eal d ir e c tly b y and l a r g e . I w ith do n o t fro m my a w a re n e s s a n y w a y , th a t th e re w e re p r o b a b ly v e r y fe w new c l i e n t s 25 in to C o lle g e a ro u n d t h a t t im e , 26 w e re n o t , 27 t h e r e may h a v e b e e n d i r e c t d e a lin g s 28 M r. T r a y n o r and M r. 29 M r. L ip s c o m b e a n d . . . (IN T E R J E C T IO N ). it g o in g d o e s n 't mean t h e r e b u t t o my k n o w le d g e t h e r e w e re n o t , but b e tw e e n L ip sc o m b e o r d i r e c t l y b e tw e e n 1 55 Q. 2 th e 3 o f s e p a r a t e d e p o s it s 4 A. 5 56 Q. 6 7 num ber o f c l i e n t s d ir e c tly A. I w ith th in k th e a t th a t t h a t w e re i n v o l v e d , in Ir is h s ta g e t h e b u re a u s ys te m ? c lie n ts ? fro m M r. 8 own p e r s o n a l p o i n t o f v ie w 9 d e a lin g , if 10 C o lle g e 11 w i t h b y C o lle g e T r u s t e e s . 12 e x e c u tiv e , 13 1 9 7 4 /7 6 14 c o rp o ra te 15 my c o r p o r a t e 16 C h an n el Is la n d s 17 57 Q. I I I p re fe rre d a n d my m a in jo b f in a n c e . f in a n c e come a b o u t? A. 24 • th is th in g f in a n c e back in t h e b a n k was a c t i n g was t o in g e t on w i t h a n d le a v e th e j u s t w a n t t o u n d e r s ta n d how you u n d e r s to o d 20 23 was a c o r p o r a t e a c tiv itie s . t h a t w e re on d e p o s it i n 58 Q. in be t h a t t h e y w e re d e a l t a c tiv itie s 19 22 I fro m my w h ic h w e re w i t h My p o s i t i o n M r. A. h ad no w is h t o g o t d ra g g e d i n t o 18 21 I L ip sc o m b e — p e o p le h ad a f f a i r s T ru s te e s t h e num ber L ip s c o m b e o p e r a t e d i n How d i d it I G u in n e s s to how w o u ld t h i s h ad some d is c u s s io n w i t h r e c o lle c tio n & M ahon, how d i d it is th a t th e re be o p e r a t e d ? ------ my w e re in te r c o m p a n y 25 a c c o u n ts b e tw e e n t h e b a n k i n 26 w o u ld h a v e b e e n in te r c o m p a n y a c c o u n ts 27 because i t 28 th e 29 c o lle c te d la r g e t h e m o n ie s come a b o u t? W hat w o u ld he d o , A g a in , r e la tio n L o n do n , was m a in ly s t e r l i n g th a t th e re fro m London b a la n c e s and I th in k d e p o s it t h a t r e p r e s e n t e d t h e b u r e a u , a c c o u n ts , was s t i l l back in D u b lin . I ■ some of t h e c l i e n t s , 1 th in k 2 m oney t o 3 w o u ld is s u e b y t e le p h o n e , 4 fro m 5 m oney and t h a t money m ig h t be p r o v id e d 6 D u b l in , 7 59 Q. I if th e w ant to th e re 9 w e re t h e A. I c lie n ts c lie n ts f in d o r o t h e r w is e , in o u t how i t ' o p e r a t e d . 12 London. I 13 G u e rn s e y came i n t o 14 la te r , w h ic h was owned b y t h e 15 w a s n 't in v o lv e d 16 it, 17 lik e 18 h a v e a c c o u n ts w i t h 19 a c c o u n ts , 20 a c c o u n t s . . . (IN T E R J E C T IO N ). G u in n e s s th in k , a t some s t a g e , it in th a t London, what G u in n e s s th e p a re n t, c lie n ts 23 w h a t w o u ld t h e y d o , in R e a lly s id e o f a bank s u b s id ia r ie s c le a r in g w o u ld ty p e us a moment ago i n who w is h e d t o o b ta in fu n d s , d i d you say? some c a s e s , a t t h a t s ta g e , I w o u ld h a v e 25 h ad an a w a re n e s s o f who some o f t h e s e b e n e f i c i a r i e s 26 a nd c l i e n t s 27 in c r e a s e d o v e r t im e 28 h a v e b e e n an i n s t r u c t i o n w e re , I e x a c t n a tu re o f th e r e la tio n th e & Mahon London b a n k . o f th e 22 to G u in n e s s N o r m a lly w i t h i n & Mahon a l l b u t th e a c c o u n t w ith k in d o f i n t e r b a n k am v e r y h a z y on i t . th in k When you s a y w h ic h was s e t up some t im e w h a t you t o l d I it. & Mahon D u b l i n 's To come b a c k t o A-. th e m i n t h e y w o u ld j u s t be t h e n o rm a l in t e r c o m p a n y lik e 24 some c o m p a n ie s t h a t w e re in t e r c o n n e c t e d ? a c c o u n ts 60 Q. o r d ir e c t c o lle c t and c o l l e c t 11 21 get D u b lin c o m m u n ic a tio n w e re in te r c o m p a n y a c c o u n ts w i t h th in k I in you w a n te d t o t h a t t h e y w is h e d t o t h e y w o u ld c a l l 8 10 some o f t h e if w h ic h k n o w led g e w o u ld h a v e fro m v a r io u s fro m M r. p o in ts , or i t T ra y n o r o r a c o u ld 1 g e t some m oney: 2 o c c u rre d , 3 th e re 4 d ir e c t 5 h a v e b e e n Ru L e o n a rd , 6 M r. 7 61 Q. 8 A. 9 62 Q. 10 A. I P le a s e th in k was t h e if g iv e M r. it o c c u rre d in GMCI a c c o u n ts d e b it. It X £ 5 ,0 0 0 . it may h a v e b e e n a m ig h t n o t h a v e b e e n me i t it T ra y n o r. You w e re i n v o l v e d To some d e g r e e , some o f t h e tim e ? yes. T e l l me w h a t h ap p ened ? L e t 's say th e re was a p e r s o n who was w e l l known t o 12 M r. 13 £ 5 ,0 0 0 , 14 w o u ld c a l l 15 h a d b e e n s e t up I 16 a c c o u n t a n d in f o r m L ip s c o m b e r a n g and s a i d : he w o u ld c a l l i t in M r. X w a n ts t o in , and c e r t a i n l y g iv e it to — get h im . He o n ce t h e b u r e a u s y s te m w o u ld j u s t d e b i t M r. th e it C o lle r y t h a t to I h is expense h ad so d o n e . You w o u ld a c t u a l l y p h y s i c a l l y h an d h im o v e r a c h e q u e o r cash? 18 19 A. 20 64 Q. C ash o r w h a t e v e r , 22 A. 23 65 Q. 24 • From w h a t you knew, known f a i r l y 26 was £ 5 ,0 0 0 th e re 66 Q. expense a c c o u n t and it? I w o u ld im a g in e you w o u ld h a v e q u i c k l y t h a t he p u t i t it 28 h is Yes. d e a lt w ith A. in to C o l l e r y w o u ld t h e n d e a l w i t h 25 27 yes. And you w o u ld p u t i t M r. 21 29 m ig h t m ig h t h a v e b e e n ' t h e b a n k a n d we knew he was c o n n e c te d w i t h 63 Q. th a t t h e p e r i o d when 11 17 If in a cc o rd a n ce w ith th e th e re code. If it is w o u ld h a v e b e e n d e d u c tio n ? He w o u ld now know t h e a p p r o p r i a t e cod e a c c o u n t . So y o u r in v o lv e m e n t was as an o f f i c i a l a lo n g w i t h a n d he o th e rs , in th e bank, i n m a k in g t h e p a y m e n ts t h a t w e re 1 2 re q u ir e d by th e A. c lie n ts , T h a t was p a r t o f i t , I fro m t im e w o u ld n 't h a p p e n e d on a v e r y r e g u l a r b a s i s . 4 c o n tin u in g 5 r o le 6 th e 7 w o u ld b e a g r e e d e a c h y e a r w i t h M r . 8 67 Q. 9 A. T h e r e was a on a c o n t in u in g b a s is w i t h C o l l e g e ^ T r u s t e e s , a c c o u n ts , th e s t a t u t o r y a c c o u n ts o f C o lle g e L ip s c o m b e . th a t? w o u ld maybe r e v ie w them w i t h M r. L ip s c o m b e , 10 t h a t w o u ld be on a p u r e l y company b a s is 11 on t h e b a s is 12 s u m m a ris e s t h e m ost o f i t . 13 68 Q. 14 15 o f in d iv id u a l c lie n t s . T h is p o o le d d e p o s it a c c o u n t was i n G u in n e s s A. I th in k & Mahon G u e rn s e y L t d . at one p o i n t i t w as. I t h i n k my 17 '7 0 's 18 bank in 19 and i n 20 and M r. L ip s c o m b e was i t s 21 p ro -te m b a s is 22 I t h e r e may h a v e b ee n a t i m e , 23 on t h i s , w h e re t h e p o o l a c c o u n t was i n G u in n e s s & Mahon G u e rn s e y f o r a p e r i o d . • 25 69 Q. o r e a r ly '8 0 's G u e rn s e y t o th e th in k is e a r ly re a c tiv a te la te s e t up a f u l l h a v in g a f u l l fir s t I may h a v e t a k e n 27 I 28 w a s . . . (IN T E R J E C T IO N ). a t t h e t im e when t h e bank c h i e f e x e c u tiv e it I it on a p r o p e r ly . am j u s t v a g u e th e name o f up i n c o r r e c t l y , change to o k p la c e d e a l w i t h now and t h e money The b u re a u ? th e d ay s o f t h a t t h e b a n k was s e t up was t h a t A. in London d e c id e d t o 26 29 some t im e u n t i l London c o u ld s t a f f My i n f o r m a t i o n , want t o th a t th a n n o t? r e c o lle c tio n o f th a t ra th e r t h e name o f was i t I but th in k th a t 16 24 th a t t h e r e was some s m a ll a d m i n i s t r a t i v e W ere y o u i n v o l v e d i n I tim e ? say t h a t 3 — to th a t 1 70 Q. No, a fte r t h e b u r e a u when t h e C o lle g e T ru s te e s 2 s y s te m , 3 account in 4 C o lle g e 5 t h a t was on d e p o s it fro m t h e C h a n n e l I s l a n d s 6 th in k , when t h e G u in n e s s & Mahon Cayman T r u s t D u b lin h ad an a d d i t i o n a l a c c o u n t w i t h T ru s te e s and t h a t chan g e o c c u r r e d , t h e money 4 in t h e G u in n e s s 7 A. I th in k 8 71 Q. I w an t you to 9 w as, I & Mahon G u e rn s e y ? t h a t may w e l l b e . t e l l me a b o u t t h e change o v e r t h a t I h a v e j u s t m e n tio n e d ? 10 A. T h is 11 72 Q. Yes. 12 A. I to GMCT Re C o lle g e . h a v e no a b s o lu t e r e c o lle c tio n of it but I th in k 13 w o u ld j u s t p u r e l y be an a d m i n i s t r a t i v e 14 pen th in g 15 fu n d s b e in g r o u t e d th r o u g h G u e rn s e y t h e y w o u ld j u s t 16 be p la c e d 17 s t u f f w it h in 18 73 Q. 19 A. 21 74 Q. 22 A. 23 75 Q. 24 A‘. in th e T r a y n o r 's p a r t . name, it is of a In s te a d o f th e a ll ju s t in t e r c o m p a n y t h e G ro u p . T h a t may be v e r y you t o 20 on M r. s tro k e it e x p la in it fa m ilia r to t o me i n you, but I w o u ld l i k e d e ta il? T he c han g e? Yes. I ju s t r e c a ll Just t e l l th e chan g e t a k i n g p l a c e . me w h a t t h e chan g e was? The c h a n g e w o u ld h a v e b een t h a t th e p o o l d e p o s its , 25 w h ic h w e re i n 26 Mahon G u e rn s e y w e re now, w h ic h w o u ld h a v e 27 r e p r e s e n t e d a d e p o s it w it h t h e u n d e r l y i n g c o m p a n ie s 28 o u t in w ith 29 G u e rn s e y p l a c i n g D u b lin i n t h e name o f t h e G u in n e s s t h e C h a n n e l I s la n d s w i t h G u e r n s e y , th o s e fu n d s b a c k i n D u b l in in a & 1 p o o l a c c o u n t, 2 flo w 3 in 4 Cayman a n d th e n fro m Cayman b a c k t o 5 7 6 Q. 6 ■ 7 o f th e th a t t h a t w o u ld h av e c h a n g e d a n d t h e fu n d s w o u ld be t h a t t h e y w e re no l o n g e r G u e rn s e y b u t t h e y w e re b o o ke d as g o in g b a c k t o In t h e b o o ks o f t h e company t h e Cayman a n d fro m Cayman t o A. Yes, it fu n d s w e te m oved t o D u b lin ? w o u ld be a d e p o s it b y t h e Is la n d s 9 h a v e a d e p o s it w h ic h p r e v i o u s l y was w i t h is 11 d e p o s it s 12 s y s te m , 13 77 Q. 14 now w i t h It th e c l i e n t u n d e r ly in g 8 10 c o m p a n ie s , D u b lin . ty p e Cayman and Cayman i s b a c k on b lo c k w i t h A. 16 78 Q. G u e rn s e y , now p u t t i n g D u b lin in th o s e th e b u re a u w h e re a s G u e rn s e y h ad done t h a t h e r e t o f o r e . was i n I th in k It th e G u e rn s e y B u re a u s y s te m i n D u b l in books t o 18 s y s te m ? 19 A. 20 7 9 Q. so. was t h e n 17 ch a n g ed so i t Can y o u a s s i s t in c o d e s w e re e x a c t l y t h e 24 80 Q: I s a id i t r e la tio n 22 A. s u s p e c t, So, I to th e Cayman b u r e a u same i n G u e rn s e y a c c o u n t was c lo s e d i n 27 th e re th in k o c c u r r e d and i t w e re i n s t e a d tw o l a r g e th a t t h e new s y s te m ? was M r. 26 th in k fro m w h a t c o u l d n ' t be s u r e . d e c is io n I codes, w o u ld seem t o me t h a t p r o b a b ly t h e f o r w h a te v e r r e a s o n i t th is th e 25 A. th e in Yes. you h av e 23 was t r a n s f e r r e d Cayman and t h e n g o t i n t o 21 29 c o m p a n ie s w o u ld h e re to fo re ? 15 28 C hannel is c o rre c t. I T r a y n o r 's m eant t h a t th e G u in n e s s & Mahon a n d a c c o u n ts ? ju s t v o lu n te e r t h i s , Cayman was v e r y much u n d e r M r . T r a y n o r 's I c o n tr o l, G u e rn s e y w o u ld h av e b e e n u n d e r L o n d o n 's c o n tr o l, it was a London s u b s i d i a r y , b e e n m ore p r o f i t a b l e 4 b e c o m in g b a c k t o 5 s u b s id ia r y , 6 G u e rn s e y , fro m t h e D u b lin v i a D u b l in Caym an, and i t may h a v e end f o r it to w h ic h was i t s 4 7 81 Q. 8 A. 9 82 Q. 10 It I A. 12 83 Q. 13 A. w h ic h was L o n d o n 's B u b l in v i a s u b s id ia r y . was a c o m m e rc ia l? th in k T h is in 11 r a t h e r th a n com in g b a c k t o so, yes. s y s te m o p e r a t e d and w h a t was y o u r in v o lv e m e n t th e s y s te m up t o — t h a t o c c u rre d in 1 98 1? Yes. Up t o th e t im e you l e f t in My in v o lv e m e n t was f a i r l y 198 8? m in im a l i n t h a t p e r io d . 14 As I 15 o f th e 16 me i f 17 r e la tiv e ly 18 an a w a re n e s s o f who t h e y w e re t h e y w o u ld c o n t in u e 19 c o n t a c t me. 20 84 Q. 21 22 I h ad become a w a re o f t h e i d e n t i t y c lie n ts , some o f th o s e c l i e n t s w o u ld c o n t a c t t h e y w a n te d t o make c o m m u n ic a tio n , s m a ll num ber o f th e m , a b u t because Some o f th em h ad b a c k - t o - b a c k W ere you i n v o l v e d i n o f some th e b a c k -to -b a c k I had to lo a n s . lo a n s itu a tio n ? A. 23 24 say, O n ly t o th e e x te n t th a t c o m m itte e o f t h e b a n k , ' I th in k about 1977. I was on t h e fro m t h e la te The b a c k - t o - b a c k 25 b e lie v e , 26 some c o n s id e r a b le p e r i o d . 27 if 28 a re 29 fu n d s , h a d b ee n g o in g on f o r , c r e d it '7 0 's , lo a n s , I p re d a te d t h a t by My r e c o l l e c t i o n some o f t h e s e p e o p le who h ad e s t a b l i s h e d c o m p a n ie s o f f - s h o r e p r o b a b ly and t h e y w is h e d t o t h e p r o c e d u r e w o u ld b e t h a t it is th a t tru s ts b o r ro w w o u ld go t o 1 M r. 2 b a c k - t o - b a c k w o u ld be g r a n t e d and i t 3 th ro u g h i n t h e n o rm a l way fro m a c r e d i t 4 d e c is io n . The e x is t e n c e 5 n o t b e m e n tio n e d i n T ra y n o r, M r. T r a y n o r w o u ld d e c id e w h e th e r a th e o f th e w o u ld go c a s h d e p o s it w o u ld s e c u r ity le tte r . ' 6 85 Q. I th in k t h e p h r a s e u s e d was " s u i t a b l y 7 A. I th in k v a r io u s 8 an a b s o l u t e , 9 q u ite 10 86 Q. If lo o s e p h ra s e s th a t I 12 b a c k - t o - b a c k lo a n ? 14 15 or "? h a v e no r e c o l l e c t i o n a b s o lu t e , of t h e p h r a s e was one comes a c r o s s on t h e d o cu m en t as s ec u red " A. is I s e c u re d th in k . 11 13 th is — c o m m itte e " s u ita b ly A lm o s t c e r t a i n l y . I " a d e q u a t e ly s e c u re d " t h a t m eant a b e lie v e it is p o s s ib le th e re w e re e x c e p t io n s . 87 Q. T h e y w e re n o t m e n tio n e d a t a l l . The f a c t th a t th e re 16 w e re b a c k - t o - b a c k lo a n s t o o k p la c e was n o t m e n tio n e d 17 in 18 A. th e N o, I fa c ility th in k le tte r s ? th e re is an i s s u e , and th e 20 h y p o th e c a te d t o 21 C o lle g e b y t h e u n d e r ly in g d e p o s i t o r a n d I 22 fa c to , 23 th o s e • e ith e r , th e w a s n 't m e n tio n e d 19 24 h y p o t h e c a t io n , it I fu n d s w o u ld h a v e b e e n p re s u m e , D u b l in h ad t h e b e n e f i t o f t h e fu n d s w e re t h e r e . t h e y c o u ld a c t u a l l y I fro m a g ro u p p o i n t o f v ie w . 26 p o i n t w i t h M r. 88 Q. 28 A. 29 89 Q. A t th e c r e d it am n o t s u r e I de k n o w le d g e t h a t if le g a lly but rem em ber r a i s i n g th e T ra y n o r. c o m m itte e t h i s w o u ld h a v e b e e n r a is e d ? Yes. M r. th in k , l a y t h e i r h an d s on th e m , 25 27 Cayman o r t o T r a y n o r w o u ld h a v e s a id t h i s o kay? 1 A. 2 90 Q. 3 A. 4 a p p ro v a l in 5 London. 6 had a keen in t e r e s t 7 cashed b ac k, 8 91 Q. 9 A. 10 11 I th e B o a rd m in u te s and i t th in k London r e q u i r e d in r e tu r n s ,; London k n o w in g w h ic h lo a n s w e re e ffe c tiv e ly ." L ondon w o u ld be in fo rm e d ? T h e y w o u ld , I b e lie v e , n o t b y me b u t i n t h e n o rm a l b a n k i n g . . . (IN T E R J E C T IO N ). 92 Q. Yes. C o u ld I re tu rn in t im e t o 12 s u b s id ia r y , 13 s h o r t t im e b e f o r e 14 W hat was y o u r in v o lv e m e n t i n 15 w o u ld go t o A. V e ry l i t t l e , M r. I K ea n e, it h ad b e e n e s t a b l i s h e d a you came t o h a v e known, t h e Cayman I s l a n d ' s th e bank I th in k . t h e Cayman I s la n d ? v e ry l i t t l e . From t im e 16 to 17 m e t M r. C o llin s , 18 to o n e - o f f t h i n g s m ig h t come up w h e re 19 M r. 20 t h e y w a n te d t o 21 D u b lin , 22 in v o lv e m e n t r e a l l y . 23 93 Q. 24 • 25 A. 26 94 Q. 27 28 29 t im e t im e I knew who t h e p e o p le w e re down t h e r e , I T r a y n o r m ig h t , b u t no, h ad m et M r. F u r z e a n d fro m t im e open an a c c o u n t o r s o m e th in g i n it was v e r y s p a s m o d ic a n d I c lie n ts o f th e h a d no C h an n el Is la n d s G roup? Cayman Is la n d s ? A. fro m t h e c r e d it h ad t h e y m ig h t be on t h e p h o ne a n d You knew some o f t h e th e I c o m m itte e fro m t h e b a c k - t o - b a c k 1 lo a n s th a t 2 lo a n s w h ic h w e re s u i t a b l y 3 95 Q. 4 A. 5 96 Q. It th e re w e re some v e r y l a r g e s ec u red . was t h a t way you g o t t o That is how I got to b a c k -to -b a c k know t h e p e o p le ? know th e m . V Why I am a s k in g you a b o u t t h e Cayman I s l a n d is th a t 6 we h a v e o b t a in e d a docum ent w h ic h was an i n t e r n a l 7 com pany d o c u m e n t, 8 not 9 P e a t G ro u p , Cayman I s l a n d s , re fe rre d a t th e 10 11 fo r o b v io u s iy S e p te m b e r, c ir c u la tio n to to c lie n ts , fir s t it E x h ib it is 1974, th e 1, it is G u in n e s s and i t is page t h a t : " . . . any re q u e s t f o r in fo r m a tio n o r in t r o d u c t io n to th e r e s id e n t p e rs o n n e l s h o u ld be r e f e r r e d t o J . Desmond T r a y n o r o r M a r t i n C. K e a n e . . . . " 12 13 14 W h a te v e r t h a t was i t 15 s itu a tio n ? 16 A. 17 18 That is my u n d e r s t a n d in g . e v e r seen t h is 97 Q . I was n o t o p e r a t e d , w o u ld l i k e d o c u m e n t, to I is th a t d o n 't b e l i e v e E x h ib it I th e have 1. g e t y o u r a s s is t a n c e on a n o t h e r 19 a s p e c t o f th e 20 We h a v e b e e n d e a l i n g w i t h t r u s t s 21 w e re who w e re b e n e f i c i a r i e s 22 w e re a g r e a t num ber o f o t h e r p e o p le who w e re on t h e 23 b u re a u s y s te m who h a d n 't t r u s t s 24 • 25 A. d e p o s it s I s e r v ic e s t h a t w e re g iv e n b y Caym an. th r o u g h D u b l in , am n o t r e a l l y o f tru s ts , at a ll f a m i l i a r w ith t h a t , as 27 C h an n el Is la n d s 28 t h e r e may n o t h a v e b ee n t r u s t s 29 cases. was a w a re t h e v a s t b u lk o f t h e I d e p o s ito r s who made th a t? Judge. As f a r c u s to m e rs o f t h e c o m p a n ie s h a d u n d e r l y i n g d o n 't b e l i e v e who b ut th e re c an you e x p l a i n 26 I w ith c o m p a n ie s , o v e r th em i n t h a t th e r e w e re , a ll c e r ta in ly 1 n o t t o my r e c o l l e c t i o n , 2 o p e n in g a c c o u n ts in 3 th a t, was a lw a y s 4 n o t a com pany and a t r u s t 5 com pany i n i t i a l l y 6 may h a v e b e e n p u t o v e r i t . 7 98 Q. th a t th e re own name o r a n y t h i n g a com pany, 9 n e v e r c o m p a n ie s i n lik e as l e a s t , o r maybe t h e r e W ere you a w a re o f a n y i n d i v i d u a l s b u re a u 11 th e ir and a t some p o i n t 8 10 a n y s i g n i f i c a n t p e o p le la te r if was a a tru s t who w e re on t h e s y s te m s who h ad n e v e r s e t up t r u s t s , th e C hannel Is la n d s who w e re o r in th e Cayman Is la n d s ? A. Not s p e c if ic a lly th a t I c an t h i n k o f. T h is came up 12 l a s t w eek i n 13 c o n n e c t io n w i t h 14 r e g a r d w h e re M r. 15 F o le y a n d in f o r m e d me t h a t he was m in d in g 16 D e p u ty F o le y a n d d i d n ' t t e l l me w h e re t h e y w e re and 17 t h e y c o u ld h av e b e e n i n e i t h e r b u r e a u s y s te m . 18 99 Q. th e c o n te x t o f th e M o r ia r ty T r ib u n a l in D e n is in 20 b u re a u s ys te m ? I c a n 't t h in k 22 1 0 0 Q. 23 A. 24 • 25 28 ju s t 29 fo r You d i d n ' t I come a c r o s s any? h a v e no memory a t t h i s th e '70's? MR. JU S T IC E COSTELLO: c o ffe e Yes. now, on t h e o f any. p o in t. Is th is ta k e n fro m P e rh a p s we m ig h t h a v e a s h o rt b re a k A. fu n d s a n y c o u n t r y b u t who w e re o p e r a t i n g 26 27 D e p u ty We h a v e h a d s e v e r a l w it n e s s e s who n e v e r h a d a n y tru s ts A. g a v e e v id e n c e t h a t T r a y n o r in t r o d u c e d me t o 19 21 F o le y and I w o u ld t h a t b e a l l r ig h t? f o r a cup o f SHORT ADJOURNMENT all . h. G +IV J iUKWHr o#AceouMrm n « Bankers G U I N J VOuMin I E S2PS.O.+3oM AHON LTD 17ColUq# »S5A G ic + n accoum CUINNPSS *ahCN CAYMAN TRUST / C31LECE HAM A /N c u tM M c r 0EIKCHJ1ARKS »»««!< external call o /a STATEMENT no. Pace : t c . L E D G E R PA»Tiojuns V A IU C O A T t ; sum m « 0 6 C 4 C C 12 sn.;(w»f m m 24JL V83 t curoi r SM A M C t O: 10JUNB5 -BALANCE BROUGHT* ZBJUNBS ;IN T . APPLrEO TO ' j - t ORWARO J 30JUMB3 30JUNS3 i 2 7 ,4 7 6 .4 5 I.C 9 J . 0 5 J .1 9 1 * 1 2 0 .3 3 1 .6 4 r ^ P ‘ '*-TJ5> S’ t **.**, ■ * .aJT^! — •, .* "!< ^ v r* " V-H C > K VsSSi— jI s f e - 5 [i : r> -•*•bw fM<««IMMHPVro?na ol . G. .rL. 1:52 n>2 .2.th (l G +M G U I N N E S S - M A H O N 17 C/cviiDuUlm 2r*f hankers *<-ccL.-*i «M t cv*«t*«cr x*n«:u c a y m a .n r ^ T / :; c ll -::. L TD i-; R'S A /K 5 - U .S . DOLLARS L E D G E R MSCximoN «A?r ,I2Ci Cl*4 EXTERNAL CALL 0 /A DAT? MSxSilf CHCRIT scutr val '-C d a :: MAftcuLARS C.C C c.c c •BALANCE BRCUGMT P<3HWA«B : 3 0 NOV 84 CR. IN TER E S T RATE CHANGED! j 9 . 00 CUINNfcSS M C T 040£Ce » i 1 : ;; ; . - • i j i 1 . . . . ‘ ] y “" 1 — i Tfm *»•*»»• h*un«#.sl>*w« !*•*vaw»*»«* iiw0«Mrmi J ^ a i»w«viif«<«*» .... ~j 1 ... 1 i j i r." { ■ ■■ ■■•■ .... ...... V;; ■■ ■■ ~ ~ylk .. i nvrc^AwN j'Aov-sctsA^f*.uH«ru:;i I**«***•«* OUIKNCSS ;<*»>CN CAYMAM rS U jT i » / C*'LL‘i ’.'.r siArrMforc*AceQucrvMm G +M G U I N N E $ S + M A H O N LTD 17CailagaCi«n 0ubli«2 P.O.SoaS5A’’iiinhmn m i l BANKHHS 4 z «xou»t wua cuinmess mahon Cayman TRUST / COLLEGE STA TEME.NT HO. PACE MO. B/T STERLING L E D G E R .a- EXTERNAL call 0/a P A K T IC U A M 1-t m o £c » 310EC83 C9JANS6 •BALANCE BROUGHT FORWARD INT. APPLIED TO 310EC35 COLLEGE GEES V A U JC QATC O f B IT A H tX jN T M X iu a 060t0a<»3 s»n«MNra»u 22JANS6 C M O IT 4 l,9 8 S .J9 3.095.41 BAUNCX 69* .058.77 736.04*.12 732,748.71 y>>^*■*" J'" * S& P ; 'S' -5 t 33 1 >1 :i 3 } * O V fR O R A W N U U M C t S A M U * » « I O 0 » :i j tUttuiNtCJXCOMtvufu G +M GUININJESS+IVIAHOINJ L T D 17Csll«««G#••«OuBlin2 P.O.BoaS5A T v o n a n m : J Z S 9*4 B A N K E R S CUJKNESS MAHOH CAYMAN TRUST / COLLEGE U S P AX3 AceoiMT Nuuata 0 6 0*0 IQ 1 ECU external call o/a L E D G E R sMruMnra*>t L. STATEMENT NO. PACE N O . 31CEC8S ............... — S , ------------- J lT A T t M I N T O * A C C O U 'I G 'fc J I N N E S S + M A H O N L BANKERS 1’ CoI!><]■• Gfwn Oudl/i 2 PC. So* G5A"tfUjcnor*-./! n u z i i i t : : .'••... 7 3 ^ t 7 / I J h / a H S T A T J IU tN T O A t t 0I3IT ‘/ A L U f i O A T S N u u i i ^ »\-7?.:-s=* /. v; •• r** ..V . . '£ hv Cr.‘*• •v.v.’ * •- ’ :•■’vr.. '^rr/.r'.-rv^ :>■:- ■ : -.•■ .•:••^ - : / :: •-"fv '• . .-. .■ /r-r V\ -';• '• v • ■. . \ ■./•.•_ '3' ' / - i " ;'" -zl.:.. .i /"v*5 - ' , tr *’• vi ^ ^ . £Zv •• .7:1. .•■■.-r-- .v .•v.-..: -• ■'■ . v .-- • ."• * • ...» ~ r~ f-r-.... ...... ._■•.•■••■. >■ _•■-> ... \ .— ■■ 3*' ;a .: : ’J r i s : " !.7 :;f- *:*r: * '*• . . £:.U M *it Th#ll«mt m d ih # 3 ***** r t o tllM ol cn ihk D « v « p i* v *ould v«IM in v d l « r » 4 i v r ^ . H £ r- O V S ^ O ^ J .W N S A U N C 1 I A n t U A rtrtC 040617 ANSBACHER LIMITED COLLEGE i CALL UTCHMARKB Balance brought forward 11 OCT 88 LODGED 17 OCT 06 BXCH IOCTBB ANSBACHBR LIMITED I RE TC 431 Copy Statemsnt 2,195,710.54 329,400.00 0.00 2,195,710.54 2,525,110.54 3 ?60617 ANSBACHER LIMITED COLLEGE c/o CALL Bal anon brought forward ?ocrsa ANSBACHER LIMITED COLLEGE RE TC 431 Copy Statement .W 2.525.110.54 )4061? LIMITED COLLEGE c/o FERNAL CALL Balance brought forward NOVBO ANSBACHER LIMITED I COLLEGE RB A/c TC 431 Copy Statement 2,525,110.5? 040617 .TERNAL CALL COLLEGE TRUSTEES LIMITED PO BOX 122 MIGNOT PLATEAU 81' PETER PORT GUERNSEY CHANNEL 131M138 0 Balance brought forward BXCH BXCH ANBBACHBR COLLEGE TRUSTEES LIMITED RE TC 431 it! Copy Statement 1,300,000.00 1,272,360.99 2,505,201.01 1.205.201.01 2,557,560.00 ■0 4 0 6 1 7 CO LLEG E TR U S TEE S L IM IT E D PO BOX 12 2 M IG H O T P L A T E A U ST P ETER PORT G U E R N S E Y C H A N N E L IS L A N D S [T E R N A L CALL D /A 5UTCH M AR KS B a la n c e 29 9 JA N 9 0 DEC 89 In t. b ro u g h t A p p lie d To fo rw a rd 31DEC89 COLLEGE TRUSTEES LIMITED RB h/c TC 431 Copy Statement 63,352.60 2,557,568.00 2.521.420.60 5040617 CO LLEG E TR U S TEE S PO BO X L IM IT E D 122 M IG N O T P L A T E A U ST P ETER PORT G U E R N S E Y C H A N N E L IS L A N D S K TER N A L C A L L D /A E U TC H M A R K S 0FEB90 B a la n c e b ro u g h t fo rw a rd COLLEGE TRUSTEES LIMITED RE TC 431 Copy Statement 2,621,420.60 40617 CO LLEG E TR U S TEE S L IM IT E D PO B O X 1 2 2 M IG N O T P L A T E A U ST P ETER PORT G U E R N S E Y C H A N N E L IS L A N D S BRNAL CALL D/A fC H M A R K S B a la n c e b ro u g h t BXCH COLLEGE TRUSTEES LT 14 M AH BXCH 90 CO LLEG E TR U S TEE S inTBUKBT TO \ R 9 0 fo rw a rd 07 MAR 90 H A T H LT COLLEGE TRUSTEES LIMITED RE TC 431 Copy Statement in 30,000.00 2,622,842.40 3 31,421.50 2,621,420.60 2,591,120.60 0.00 . - - Appendix X V 1. ( 147) M r T o m C o n a t y Evidence relied upon by the Inspectors in arriving at the conclusion relating to M r T o m Conaty. a) Guinness and Mahon Internal M e m o of 20 M a y 1977. b) Guinness and Mahon Credit Committee Minute of 17 M a y 1978. c) Guinness and Mahon Credit M e m o of 21 April 1988. d) Guinness and Mahon account statement of 20 M a y 1983. e) Annual Return of T o m Conaty Ltd of 13 December 1977. f) Annual Return of T o m Conaty Ltd of 25 January 1978. g) Annual Return of T o m Conaty Ltd of 21 February 1979. h) Annual Return of T o m Conaty Ltd of 17 November 2000. i) Letter of 13 September, 2001 from Arthur Cox enclosing statement of T o m Conaty. tolsm . Tom Candy Limited: my; ?65,000 worlan capital Tm 3 mm, 1977 3-213? Gua'unteo Fee $96 ?at gm_ 'sombly Second. W. M in u te s o f th e 2 0 4 th M e e tin g o f th e B a n k in g /C re d it C o s m ltte e h e ld a t 17 C o lle g e G ree n , D u b lin 2 , on Wednesday 1 7 th M&y, 1 97 8 . • , J .D .T . - M .E .O 'K . - H .P .D . - GMcC - B M c L .-I.W .X . - i . C . MONEY MARKET: Im m inence o f nake up day In b o th London It D u b lin h e a v ily r e f le c t e d In s h o rt end r a te s - p o s itio n a g g ra v a te d b y re c e n t pu rch ase and c o n s e q u e n tia l fu n d in g o f G IL T S . A g e n e ra l "phone around" to p o t e n t ia l d e p o s ito rs has been t r a i l re c e iv e d and has r e s u lte d I n a d e p o s it o f £ 3 0 0 ,0 0 0 fro m B o th In flo w and S t e r lin g p o s itio n s a r e I n o r d e r . £ $ n . le n t ’ 3 n /f • drawdown by them to fifm . 1% tu r n b r in g in g t o t a l ^FOREIGN SXCMKGX: T ra d e fig u r e s on Monday pushed r a t e up t o 1 .8 2 4 0 . V e ry heavy s e llin g o f S t e r lin g o u t o f Geneva y e s te rd a y b ro u g h t r a t e below 1 .8 1 . Today 1 .8 1 2 8 . We s o ld S w edish K ro n e r 8 0 0 ,0 0 0 t o ■m ' We have a rra n g e d a n Ir r e v o c a b le L e t t e r o f C r e d it fo r U .S . $ 6 1 ,8 8 2 w it h fo rw a rd c o v e r to m ld-A ugusx. Tom C o n aty L im ite d Am ount: £ 5 0 ,0 0 0 (F re n c h T ra n e E q u iv a le n t) G u a ra n te e . p u rp o s e : G u a ra n te e to G exnant B a r i, Hue J u lie n G ro ftle a u , 4 4 2 0 0 tfa n te s Term ft 8 o u ro e o f R epaym ents: 2 0 th May, 1B78 - 2 0 th A u g u s t, 1978 R a te : 1% P . A . S e c u r ity : S u ita b ly 8 e c u re d (i.e . & ) Cradh Mamoraadum Submtttad by: P O 'D NAME: T O M CONATY LIMITED ADDRESS: Balmoral Fruit Market, Belfast. • • b u s in e s s / OCCUPATION: Equity Staka: No. CM. Approval: Yaa/No ParmlaiJon Obtainad Data: NA ■ Fruit Broker. AMMwwprapxM** /.fifflKM lM fl______ TYPE: _ AMOUNT: O/D . f ________ __I lll- I JUQM LStt-. ft.000 Stg. — RAT6* F E E :___ RLfJl&L BLR PURPOSE/DRAWOOWN: ) To secure working capital facility froai Ulster Bank Limited. •Tccaakwai O/D facility. < r ~ ' pw m ltlrt prior to compMonaf aacurbyT YES/NO REVIEW OATES: TERM OF F AClUtlBS! Ti (tension for'coo year 31.03.89 SOSJRCE O f REPAYMENT: If wMMoimI 9f M litin f faaMty, h aaourlty in ordar? SECURITY* ‘ jaraibtee-.signed fey Tom Canaty. YES/MO If No, )m datalfcwparatdy. BAdCQnOUNbNQrtE/ The guarantee hat been In force for • number of yean. We have been Informed { 'M r. Cmhm# teat accounts for the year ended Manta, IMS are being prepared. Ha ha* ateted that the ■t baa Mfa. a successful one and the accounts will show the coinpany to be in a healthy state. He has sretall *hops> all trading profitably. • Q tfTU > i«O F pr q po &AL: ctensien recommended. nJS&tad FaeRltiti/BomNMn:. (Ealanea.ar tlnrit, w W dw w itgraatarl CREDIT CO M M ITTH I Mlnuia___--------------------------------------------------------------------„ p 1 _______ _______________________________________ («Reeomm»nded . Total Exponwr. £58,000 BOARD ' G+M G U I N N E S S + M A H O N LI 17CaNaa*0n«i0ijM bi2P0 BoaSSAixwinan* • OANKCRS c u s n n p s s mahoh cavm an m u s t / c/o o p c caLUfece r, T" ■Ti-jt-j* ~r~ ;v made up to the____ 3.1&.&:._____ day of .... J& .£g '-SM.Sk.SK— .,,.„.....;2...».i9lii!a-{fcm na'thir fa« rtaenth d a y f i8 5 £ t t e d a t e n f t h t > A n n n a I . . < 5 f l P w r g l / M < »At i n B ■ ■ . ■• ■ . ;. 6 m - H i < u i 'Li i wl f t i i t M a ) . ■■ ■ ■ •■- : T \ ' V' , - V-- f ■-. i./.t..’ .: r «■‘-IV.V > , - ■ . , v- . ; > JDelete'<^LIini»ecr;4if.na« applicable .’ ■ '; 1. Address of registered office v-:: . M S i .SZjgJZJSJZ. i ,~ .i 2. Sitnj^ion of the Company’s registers, etc., if kept at an address other than the registered office 1/____ CDo c A- (b) Register of debenture holders.. Presenter's Reference. J i n , . & ■ . tC A j^ t z s r e -d vas. . F O R M No. 6A I (a) NOMIN. S H A R E C A P IT A L divided into: . Nominal share capital £_ .shares of. (b) ISSUED S H A R E C A P IT A L A N D D EB EN TU R E S v. . Number . 2. Number o f shares o f each class taken up to the date o f this return <«'"Sch number must agree with the total shown in the list as held existing members). 3. Number o f shares o f each class issued subject to payment wholly in cash. 4. Number of shares o f each class issued as fully paid up for a consideration other than cash. ■ 5. Number of shares of each class issued as partly paid up for a consideration other than cash and extent to which each such share is so paid up. 6. N um ber o f shares (if any) o f each class issued at a discount. 7. Amount o f discount on the issue o f shares which has not been written off at the date of this return. Number ___..per share on----8. Amount called up on number ^ £. o f shares of each class. __ per share on..._..... ...... . __ per share o n __________ * Only paragraphs 13 and 14 of this section relate to debentures. N o particulars are required in respect ot" debentures under any o ther para­ graph of secuon 3. w ,.,-, num ber and class of shares. Number 10. T o tal am ount (if any) agreed to be con­ sidered as paid on num ber o f shares of each class issued as fully paid up for a consideration other than cash. Class __..shares •£___ {U..Q.-W-& .on - . shares - shares 11. T otal am ount (if any) agreed to be con­ sidered as paid on num ber of shares o f each class issued as partly paid up for a consideration other than cash. .shares f!K: >£’_ _ 4 Z . Q S i J t — on - ..shares ..shares 12. Total am ount o f calls unpaid . ]•1 ^’r,'•1• V’*’V•1».: ^ <* V • ■ fP 14. T otal am ount o f the sums (if any) allowed by way o f discount in respect o f any deben- : J f . , , ..................................................... tures since the date o f the last return Number p r rn rri; ^• v'*'c ^r ‘:iv v * 1; o A J & _ . •••'*• , . } . ,'> .-.v■, ' :( •, ? ; u' 'it;,J !i A-. ^i / V • a 4 * Class -V-CT.ir’ r-'.^rrf* ^ ...shares ...__i-shares 15. Total num ber o f shares o f each class forfeited. ........ share: 16. T otal am ount paid (if any) on shares forfeited . • • • ■ 17. Total am ount o f shares for which share w arrants to bearer are outstanding •■■■• • . . 18. T otal am ount o f share w arrants to bearer issued and surrendered respectively since the date o f the last return. "I Issued: f J Surrendered: 19. N um ber o f shares comprised in cach share w arrant to bearer, specifying in the case of w arrants o f different kinds particulars of each land, \ £—- — £_ j- 4. Particulars of Indebtedness Total am ount o f indebtedness of the company in respect o f all mortgages and charges which are required to be registered with the Registrar of Companies under the Companies Act (N orthern Ireland) I960, or which would have been required so to be registered if created after 1st July, 1908. T ( . J r. :i . in art register {er cont icu aming of Past and Present Members Names and addresses .H . UNI . 5.1Account of Shares Number ofshares or amount ofstock held by existing members at date of return 1 r )kv- Particulars ofshares transferredsince the date ofthe last return, or, in the case of thefirst return, of the , incorporation of the company, by (a) persons who are stillmembers and (b) persons who have ceased v to be members Number . •; -;V : • \ • ; ..... __ ■ » L* v-4?■ X. joa j.t; ^ • ■? ■ w 3oc> •. 'f■>:;•«;,« V.1,■• >•1. ... •. transfer ■, . . \ - x ' . c t v •••. : •• ' («) ■ ■■ t • ■. ' .: : • ■ ... *...... . ; ,v.: jv:tr s. ....... ■ . ,*J V - , * 77*; A > . J ‘ .. ... !m . .......... r>M-: •>................... ••.,>. -... —«•— : • ■ ........ »?>•».*- ,:,r . •• •* ' • J.' • ; ' ,•>*• - ..... ■• •- ■" '■■ ' j....** ,.y . i .;., . •--a v n *-■t v. ; . ^ i *• •4i>W» >.r.Jv. . . ...... . . ■ ■--n ■••t-r1 ,■•. - . ■. ■••■fT v.'r'Vr-:*-..... ~~ . •• icfiU-:‘ ;. ' ,. . : - , . . ... . ■ . P articulars of Directors and Secretaries (N otes overleaf) ' ■ ■ Name . . . . : ..... / .... ^ i V ' f / ^*f -5yJ V*vi 'fe *f Any former Christum nort ■>- or names and sumcwe * S ?**' '-T“ J ^•^TTt3f*nri ..................................... jtiiTX..SSsa-LKtezbx.___tjtctaesa.— X 'M " ___ ; . . 1 A* '~ & ^ s ^ ' ^ •■ • ,. , vr. ’ii(-ri-,:.-.:;;«rf 1 _____________________________ ___ * ' 1 •** t, M ■ . -. ' ^ ■ 1 ! t P articulars o f the person who is secretary o f th e company at the date o f this n ta m . Name T.ffl!*'* Business occupation andparticulars ofother 1 directorships -> Address Date ofBirth V ■ ;*■■■'.*■' -r ;:• vr.yV/-;' - : ’ P.......... ........ ‘ V .... :!....11 .. ■ ''■ •’ : ...v,‘ ■- ■ r 1 i.''‘iT'*"1* j}A > r *It 1 m ^ u v:'v:; f ^ ! i;.? r '- JL Signed. Signed „ _ N ^ U - U 3 Certificate to be given by a Director and the Secretary of every Private Company W e certify th a t the com pany has not since the date o f the last annual return (or, if this is the first retu rn m ade, since the date o f incorporation o f the company) issued any in v ita tio ^ tp the public to subscribe for any shares o r debentures o f the Company. Secretary Further Certificate to be given as aforesaid if the Number of Members of the Company exceeds Fifty We certify that the excess o f the num ber of members o f the com pany over fifty consists wholly o f persons who, under paragraph (b) of subsection (1) o f section twenty-eight o f the Companies Act (N orthern Ireland) 1960, are n o t to be included in reckoning the num ber of fifty. Signed..... Signed. _ D irector ,S enetary D irector” includes aily person '.vho occupies the position o f i director by '.vhat3cc'/;r „n .»ith whose directions o r instructions th'c directors o f the com pany ir«j accustonred :o act. “ C hristian nam e” includes a forenam e, and “surnam e” , in the case of surnam e, m eans th a t title. ~dwl. t.-u » % ^KBE$gg5jSsj a peer or “siso n usuallyV 'now, , ; , * "F o rm e r C hristian nam e” and "form er surnam e” do not include: . .. (a) in the case o f a peer o r person usually know n by a British title different from his surnam e, the n a m e b r ^ r t i L h ^ ^ P previous ' to the ‘ adoption doption o« f o r succession to the title; or j .* V v ^ 8 ! ? S : - ' „ " f vi &C^£7333, (b) in the case o f any person, a form er Christian nam e or surnam e where that name or 'uraarne ms the person bearing the aarae attained the age o f eighteen years or has been changed o rd& osed'farV iiierfiS f*^' than twenty years; or (c) in the ease o f a m arried wom an the nam e o r surnam e by which she was known previous (O' th e in a a ff ia ip P ^ T he names of all bodies corporate incorporated in N orthern Ireland o f which the director is be given, except bodies corporate o f which the com pany making the return is the ’vholly-ownedVubsfaiiSt^S . corporate which are the wholly-owned subsidiaries either of the company or o f another com pany'of'ivH djStlic^^, is the wholly-owned subsidiary. A body corporate is deemed to be die wholly-owned subsidiary o f a n o t h ^ i i l i j m em bers except th a t other and that other’s whoily-owned subsidiaries and its o r their nominees I f th esp acefiis in the form is insufficient, particulars o f other directorships should be listed on. a separate'statem ent AttafridS ■lorm- ' ■ ■ '- ■, -■■ , :■ v :.. ■ • ; o- i 'D a te s o f birth need only be given in the case o f a company which is subject to section I7ob£,tK e^ci (N orthern Ireland) 1960, namely, a company which is not a private com pany or which, being suV^**aiy o f a body corporate incorporated in the U nited Kingdom which is neither a priyata’c o m p a h y n ^ ^ ^ ^ . re :ed under the law relating to companies for the time being in force in G reat B ritain and having constitution which would, if it had been registered in N orthern Ireland, entitle it fo rank as a'private C om plm f : -• : ^ r ' W here all the partners in a firm are joint secretaries, the name and principal office o f the firtrfm ay b e afatea ■? ' : o ’ - ' i Certified Copies of Accatmfa .; Except where the company is either a private company as defined by section 23 o f tins Com panies; Act; Ireland) I960, o r an assurance com pany which has complied with the provisions o f section. 7(4)"’o f1the'ASL C om panies Act, 1909, there m ust be annexed to this return a w ritten copy, certified both-by a,director'^md l secretary o f the com pany to be a true copy, o f every balance sheet laid before the com pany in general meeting^; th e period to which this return relates (including every document required by law to be anneaed’„to the balance* an d a copy (certified as aforesaid) o f the report o f the auditors, on, and o f the rep o rt o f the directors'iccom j each such balance sheet. If any such balance sheet or document required by law to be annexed thereto is in language there m ust also be annexed to th a t balance sheet a translation m English o f the balance'sheet b r i l certified in the prescribed m anner to be a correct translation. I f any such balance 3heet as aforesaid ordccumenVx^ '"■‘‘'la w to be annexed thereto did not comply with the requirements o f the law as in force a t the~date o f the a ^ .ospect to the form o f balance sheets o r documents aforesaid, as the case may be,, there m ust be m ade such i to and corrections in the copy as would have been required to be m ade in the balance sheet o r docum ent in i____ _ m ake it comply with the said requirem ents, and the fact that the copy has been 30 am ended m ust be stated thereon?/ Banking Companies A banking company, in order to avail itself of the benefit o f s. 380 o f the Companies A ct (N orthern Ireland) 1960^ ....... m ust add to this return a statement o f the names o f the several places where it carries on business. Qm.075632 3,000 3/73. N.&K.(N.I.)Ud. Gp-3162 ?99??wi ■131®"'::^--: ;-K -’ 2. Situation of the Company’s registers, etc., if kept at an address other ihaa (a) Register o f m em bers- U > rii.l.l/U & rTY> /v ___ 4 S J . P J 9 S 7 - (b) Register o f debenture holders. Prescntor’s Reference____ S S _ A u J J iA J ^-VJ>73 J u . FORM No. 6A (Use filing fee is £10) (a) N O M IN A L S H A R E CA PITA L v 1. Nom inal share capital £_____ C>---------------------divided in to : -- -- 2. N um ber o f shares o f each class taken up to the date o f this return (which num ber m ust agree w ith the total shown in th e list as held by existing members). 3. N um ber o f shares o f each class issued subject to paym ent wholly in cash. . - - 4. N um ber o f shares o f each class issued as fully paid up for a consideration o th e r th an cash. 5. N um ber of shares o f each class issued as partly paid u p for a consideration other th an cash and extent to which each such share is so paid up. 6. N um ber o f shares (if any) o f each class issued a t a discount. 7. A m ount o f discount o n th e issue o f shares which has not been written off at the date o f this return. Number '£ ......... .... I .............. ......... per share on__jLq_.C«L. 8. Amount called up on num ber of shares o f each class. I £ _______ __________ __ r sharc on ________________ per share on ___shares • Only paragraphs 13 and 14 o f this section relate to debentures. N o particulars are required in respect o I debentures under any other para­ graph of section 3. Insert Dumber and class of shares. 3*0 £— .\ / Class 10. Total amount (if any) agreed to be con­ sidered as paid on number of shares of each class issued as fully paid up for a consideration other than cash. -shares _on >•£- ,>' vj 11. Total amount (if any) agreed to be con- ' sidered as paid on number of shares of each class issued as partly paid up for a consideration other than cash. .*t'r-7.:*ft';V _on ^ ..s.i-ry-.'r'T .Tv: ' If1/ ; , ’• ■ , shares :r.; ■' IfljPfXfS •.-fn • w * ...... ‘ •'■.’iV - ....... shares ■H&SaMig; 12. Total amount of calls unpaid . ^ ; i'. £- 13. Total amount of the sums (if any) paid by way of commission in respect of any shares "I , or debentures .......................................................................................~ —■— 14. Total amount of the sums (if any) allowed by way of discount in respect of any deben­ tures since the date of the last return . . . . • • . - ; Number .?> Class .- K / v>‘ ^ ■ .shares .shares 15. Total number of shares of each class forfeited. -shares 16. Total amount paid (if any) on shares forfeited . ■ • • • 17. Total amount of shares for which share warrants to bearer are outstanding 18. Total amount of share warrants to bearer issued and surrendered respectively since the date of the last return. • .. Issued: V J Surrendered: ££_ 19. Number of shares comprised in each share warrant to bearer, specify- \ ing in the case of warrants of different kinds particulars of each kind. / _ 4. Particulars of Indebtedness Total amount of indebtedness of the company in respect of all mortgages and charges which are required to be registered with the Registrar of Companies under the Comp­ anies Act (Northern Ireland) 1960, or which would have been required so to be registered if created after 1st July, 1908. ^ / [ / oaj i “ Folio in register ledger containing partiadars 7710/1/95 60?;ng conga-2v?! H/as ?ag/mm com/92'? {Ev 2 I ?957 - Mari-i khan-1i 1. 121293 1.. . Eli-Mg'g" .- ma?. SA 's ?1 4 Ha ?uxi?i? . I I, I . ■ Account o f Shairss . ■ - '- Particulars of shares transferred sines the date of the last return, or, in the case of the first return, of the incorporation of the company, by (a) persons who r Remarks are still members and (b) persons who have ceased r ■ - i : •■ ■• lobe members Number o f shares or ; amount o f stock held by existing members at date ' o f return Data of registration of.... transfer ■>■••.rM !'. Number * . , 1 • ' (b) (a) Z?o n ' * ? if-\ ^ v f *■4 '• >r V.-: .i .W .V ''•■■• i' ■•t.1le* ".'•'\iw.\wf .• ..•'••• v . . • >f f ' *' t ' xT; - , ' -• • ... . ._ ' / .JLd...c J h »» "■ ; * •• * -*k S’ \ ’ , / / ' XV--.-/ * ^ :.Jv; >"'1•>.■:'V ';V . V/?'-J — ,----- '*"'.v*: , If V* i.-if i 1‘ '•.' J ■ : .:■■■■■ r •i i . V ; . . . ! " \ -r- •. -------- ---------- ----------: — * ~ J" - ----- ...■ .-V-» --------- •-------- --------------- •• i. • ■•, 7 , ' ' 6. Particulars of Directors and Secretaries (Notes overleaf) . ■■ v Particulars of the persons who are directors of the company at the data of thi/ ^cum. * ...r..--..,,... . N a m e . Z Z > g -t V J S C Z a A j A J n ...... ............ >t/CU .../ a X'' y . ........... /■?t: ^ S e & t F A J ' T / L t K -r : • ... .... ..A.t- ,-■■"■ A d d r & u fe^fer , O i -.. f'aE**- a . ■ ■'1 • ': ■...■•K.u^iSii ................... .. r “ / A f / Z o A ^ > O r W e certify th a t the com pany h as not since the date o f the last annual return (or, if this is tbe first retu rn madi since the date o f incorporation o f th e company) issued any im jijation to the public to subscribe fo r any shares c debentures o f the Com pany. Farther Certificate to be given as aforesaid if the Number o f Members o f the Company exceeds fifty We certify that the excess o f the num ber of members o f the com pany over fifty consists wholly o f persons wh under paragraph (b) o f subsection (1) o f section twenty-eight o f the Companies Act (N orthern Ireland) 1960, are n to be included in reckoning tbe num ber o f fifty. ' Signed-. ,D irect VES: "D irector” includes any parson who occupies the oosidoa of a direcasr by whatsoever 'lar^.j with whose directions or instructions tho directors Jt' tha com pany ar-3 iccustonsui to .ic:. “ Cariatian nam e'’ includes a forenam e, and surnam e, m eans that title. i —c n j i. , , in :hc oase of a peer or ‘Form er Christian j*d „r Jisused o r j « r a p e rc d ij* than twenty ;"ean; or =• (c) in the case of a m arried w om an the a a m e o r s u rn a m e b y w h ic h s h e w a s i n u vr ' r" ru U 3 o ! / h e l u u n i j e . ^ «- ‘ ' •• * ( X-tjf, ZzVsu '■ .. „ 4 T h e n a m e s o f a ll b o d ie s c o r p o r a t e i n c o r p o r a t e d i n N o r t h e r n I r e l a n d o f w h ic h f i e d i r e c t o r Zi a L o a dijsctoifc b e g iv e n , e x c e p t b o d ie s c o r p o r a t e o f w h i c h t h e c o m p a n y m a k i n g t h e r e t u r n is th a w h o lly -o w n e d . m o s i d ia j ^ o f c o r p o r a t e w h ic h a r e th e w h o lly - o w n e d s u b s id i a r ie s e it h e r o f th e c o m p a n y o r o f a n t h e r c o m p a n y o f w n i c i, t h e c "* is t h e w h o lly - o w n e d s u b s id ia r y . A b o d y c o r p o r a t e is d e e m e d t o b e t h e w h o lly - o w n e d s u b s id ia r y a £ a a d t i w r j / 'f m e m b e r s e x c e p t t h a t o t h e r a n d t h a t o t h e r 's w h o lly - o w n e d s u b s id i a r ie s a n d lis o r th e ir n o m in e e s . I f t& a jp a c © i n t h e f o r m is in s u ffic ie n t, p a r ti c u l a r s o f o t h e r d i r e c to r s h ip s s h o u l d b e l is te d o n a s « r 'd r a t a s t a t e m e n t a t t a c h f o r m .' ' : ’■ ............. " ■. .. ■■" * t i ,f, itc v ® ’ ' ' ■ ■ ' < D a t e s o f b i r t h n e e d o n ly b e g i v e n i n t h e c a s e o f a c o m p a n y w h ic h is s u b je c t t o e - t i o n 17 5 o f t h e C o m e a S e J ( N o r t h e r n I r e la n d ) 1960, n a m e ly , a c o m p a n y w h ic h is n o t a p r i v a t e c o m p a n y o r w h ic h , b e i n g a p r i / a i . . c o i a c a a ^ ' s u b s i d i a r y o f a b o d y c o r p o r a t e i n c o r p o r a t e d i n t h e U n i t e d K i n g d o m w h ic h is n e it h e r a p r iv a te - o m p a n y n o r a ^ “v ste re d u n d e r t h e la w r e la tin g t o c o m p a n i e s f o r th e tim e b e in g in lo rc e m G r e a t T3r ta^ a n f l a a v m g p r o v i s i o n j S t i t u t i o n w h ic h w o u ld , i f i t h a d b e e n r e g is te r e d in N o r t h e r n I r e l a n d , e n title d to rani!: aa x p r v a t e C o r n g a a y ^ l ;; W h e r e a ll t h e p a r tn e r s in a firm a r e j o i n t s e c re ta r ie s , t h e n a m e a n d p r i n c i p a l o ffic e o f th a f i r m m a y * b e l • • . . • •• :• ■ ■ ‘ ’ • ' . • • ^ ' ^ . I,../ • ■ ■ . . . ’ . ■ . . • '. - . ■ .... * ^ 1H^ c r > r 1 V C e rtifie d C o p ie s a f A c co M ita • u 1 rf * • . t . £ ^-*T, * ■s • ; ; .y ' 1*+ %jX ^ l£ E x c e p t w h e re th e c o m p a n y is e it h e r a p r i v a t e c o m p a n y a s d e f in e d b y s e c tio n 23 o f d w C o m o a n i e s A c t (>1 I r e l a n d ) 196 0 , o r a n a s s u r a n c e c o m p a n y w h ic h h a s c o m p lie d w i t h t h e p r o v i s i o n s o f s e c ti o n 7(4}^ o f j & e Asis C o m p a n i e s A c t, 1909, t h e r e m u s t b e a n n e x e d to t h i s r e t u r n a w r i t te n c o p y , c e r tif ie d c o th " b y ..a .d ir e c t o r a a jf e . s e c r e t a r y o f t h e c o m p a n y t o b e a t r u e c o p y , o f e v e r / b a la n c e s h e e t la i d b e f o r e t h e c o m p a a / i n g e n e r a l m e e tin g o zs a n n e x e d "n t h e b a Ja n c fr t h e p e r io d t o w h ic h t h i s r e tu r n r e la te s ( in c l u d i n g e v e ry d o c u m e n t r e q u i r e d b y l a w a n d a c o p y (c e rtifie d a s a f o re s a id ) o f t h e r e p o r t o f t h e a u d i t o r s , o n , a n d o f th e r s p o r t o f t h e d ire c to rs i c c o m p a i j m e a c h s u c h b a la n c e s h e e t. I f a n y s u c h b a l a n c e s h e e t o r d o c u m e n t r e q u ir e d b y la w t o b e a n n e x e d t h e r e to Is i n a l i o n a r l a n g u a g e th e r e m u s t a ls o b e a n n e x e d t o t h a t b a la n c e s h e e t a t r a n s l a t i o n i n E n g lis h o f t h e b a la n c e - .3 h e e t" o r 4 ^ > g t t ei c e r t if i e d in t h e p r e s c r ib e d m a n n e r t o b e a c o r r e c t t r a n s la t io n . I f a n y s u c h b a la n c e s h e e t a s a f o r e s a i d o r d o d i m e h r hst l a w t o b e a n n e x e d t h e r e to d i d n o t c o m p ly w ith t h e r e q u ir e m e n t s o f t h e la w a s i n f o r c e a t t h a d a le , o f th e . a b d f c* 1 ■ .... _ p e c t t o th e f o r m o f b a la n c e s h e e ts o r d o c u m e n t s a f o r e s a i d , a s t h e c a s e m a y b e , m e r a m u s t c e m a a 2^ u c l i . ^ ( t o a n d c o r r e c ti o n s in t h e c o p y a s w o u l d h a v e b e e n r e q u ir e d t o b e m a d e i n t h e b a l a n c e s h e e t o r d o c u m e n t in < m a k e i t c o m p ly w i t h th e s a id r e q u ir e m e n t s , a n d t h e f a c t t h a t t h e c o p y h a s b e e n 3 0 a m e n d e d m u s t b e s t a te d i ' \■ B a n lu n g C o m p a n ie s - A b a n k in g c o m p a n y , in o r d e r t o a v a i l i ts e l f o f t h e b e n e f it o f s. 3 3 0 o f th e C o m p a n i e s A c t ( N o r t h e r n I r e la n d ) m u s t a d d to t h is r e tu r n a s t a te m e n t o f t h e n a m e s o f t h e s e v e ra l p la c e s w h e r e i t c a r r i e s o n b u s in e s s . D d O 3 2 3 0 7 1 m 7 p ~ 3 L C C p ‘ 3 9 S S 6 CO j/C h 'J /T O M CON A7Y N o . o f C o m p a n y ------ t i & J / S — LTD 1OO (Ml - THE COMPANIES ACT (NORTHERN OLSLAND) 1960 Annual Retnrn of a Company haying a Share Capital As • required by Part IV of the Companies Act (Northern Irela Annual Return of... Limited* made up to the------________ day of... date of the Annual General Meeting for the year 19___). ^££(being the fourteenth day after the , * Delete “Limited” if not applicable 1. Address of registered office ............. '.. .. U L S T & J l & W I C ± .. £ .• • • • . " . • Class Number 10. T o t a l a m o u n t ( i f a n y ) a g r e e d t o b e c o n ­ sid e re d a s p a id o n n u m b e r o f s h a re s o f . e a c h c la s s is s u e d a s f u lly p a i d u p f o r a c o n s id e ra tio n o th e r th a n c ash . . . . .... ■ ..... .... ... shares ...slifHW? ohfirM 11. T o t a l a m o u n t ( i f a n y ) a g r e e d t o b e c o n ­ sid e re d a s p a id o n n u m b e r o f s h a re s o f e a c h c la s s is s u e d a s p a r t l y p a i d u p f o r a c o n s id e ra tio n o th e r th a n c ash . 12. T o t a l a m o u n t o f c a lls u n p a i d . _ ... .o n .. fffiflreo .o n — -shares . . • . . •' • "’ . , . ' » . ■• p v •"':s^-V-'7 i i>, >v.V1 ; ' 13. T o t a l a m o u n t o f t h e s u m s ( i f a n y ) p a i d b y w a y o f c o m m is s io n i n r e s p e c t o f a n y s h a r e s \ o r d e b e n tu re s . . . . . . -J i 14. T o t a l a m o u n t o f t h e s u m s ( i f a n y ) a llo w e d b y w a y o f d i s c o u n t i n r e s p e c t o f a n y d e b e n - . tures since the date of the last return • • ’ * . . • V" ■ v. ,■ Number . ... J Class r ..shares .s h a r e i 1 5. T o t a l n u m b e r o f s h a r e s o f e a c h c la s s f o r f e ite d . .s h a m V 16. T o t a l a m o u n t p a id ( i f a n y ) o n s h a r e s f o r f e i t e d 17. T o t a l a m o u n t o f s h a r e s f o r w h ic h s h a r e w a r r a n t s t o b e a r e r a r e o u t s t a n d i n g . .. 18. T o t a l a m o u n t o f s h a r e w a r r a n t s t o b e a r e r is s u e d a n d s u r r e n d e r e d r e s p e c tiv e ly s in c e t h e d a t e o f t h e l a s t r e t u r n . "j I s s u e d : f ' J S u rre n d ere d : 19. N u m b e r o f s h a r e s c o m p r i s e d i n e a c h s h a r e w a r r a n t t o b e a r e r , s p e c ify in g i n t h e c a s e o f w a r r a n t s o f d if f e r e n t k i n d s p a r t i c u l a r s o f e a c h k i n d . \ J - £_ £— / 4 . P a r t ic u l a r s o f In d e b te d n e s s T o t a l a m o u n t o f i n d e b te d n e s s o f th e c o m p a n y in r e s p e c t o f a ll m o r tg a g e s a n d c h a r g e s w h ic h a r e r e q u ir e d t o b e r e g is te r e d w i t h t h e R e g is tr a r o f C o m p a n ie s u n d e r t h e C o m p ­ a n ie s A c t ( N o r t h e r n I r e l a n d ) 196 0 , o r w h ic h w o u ld h a v e b e e n r e q u ir e d s o t o b e registered if created after 1st July, 1908. er List of Past and Present Members Folio in register I edger containing Names and addresses particulars Mfr/:15 weave; cameranew. I i 7754?? LTD i) ./27 1 1 Accbun: of Shares- . b? Particulars of shares tramferred since the date oftize '9 Number of shares or last return, or in the case of the ?rst return, of the mount of stock held by incorporation/ of the company, by person: who?: existing members at date are still members and person: who have ceasede of return to be memberDate bfr?gi?trqribri "bf a Number . Itbrarzsfer 2.9 0 [11ii S B H H I I l i i H H i H H . P a r t i c u l a r s o f D i r e c t o r s a n d S e c r e ta r ie s ( N o t e s o v e r le a f ) ' :; ’ a r t i c u l a r s o f t h e p e r s o n s w h o a r e d ir e c to r s o f t h e c o m p a n y a t th e d a i s o f th is retu rn .!? i c u l a r s o f t h e p e r s o n w h o is s e c r e t a r y o f t h e c o m p a n y a t t h e d a t e o f th is r e t u r n . / Name '" b S - A J K Address C u .... X ly U 7 - /? /,V / g & L - p o s - r __________ _______ ■ y > ^ _ • •• ,• ' ' ' 7: ';\K :*£'V _ ' ' •..: •' : ■ __ B u s in e s s o c c u p a t io n a n d p a r t i c u l a r s o f o t h e r A d d re s s D a te o f B ir t h d ir e c t o r s h ip s - o '] fta2^6r ■. - K - J ’,.-.. . ■ ' , ■ . i;‘V; i . T• ' • ’ • •' ■'’• ■' %•:jrr*:''- :v«'■••'•i'ivi *>.■■}■.r.-i , ■yt:: v-r ^ - < \ L <• v f i t ( //^ i. S ig n e d s S r ^ ^ A - .. .. - / X - • ,r> irertn r r w i^ ^ « £ i™ .^ S e c r e ta ry C e r tif ic a te t o b e g iv e n b y a D i r e c t o r a n d th e S e c r e ta r y o f e v e ry P r i v a t e C o m p a n y W e c e r tif y t h a t t h e c o m p a n y h a s n o t s in c e t h e d a t e o f t h e l a s t a n n u a l r e t u r n ( o r , i f t h is is t h e f ir s t r e t u r n m a d e , sin c e t h e d a te o f i n c o r p o r a t i o n o f th e c o m p a n y ) is s u e d a n y i n v i t a t i o n t o t h e p u b l ic t o s u b s c r i b e f o r a n y s h a r e s o r d e b e n tu r e s o f t h e C o m p a n y . S ig n e d . S ig n e d F a r t h e r C e r tif ic a te t o b e g iv e n a s a fo re s a id i f th e N u m b e r o f M e m b e r s o f tS&s C o m p a n y e x c e e d s F i f t y W e c e rtify t h a t t h e e x c e s s o f t h e n u m b e r o f m e m b e rs o f t h e c o m p a n y o v e r fifty c o n s is ts w h o lly o f p e r s o n s w h c u n d e r p a r a g r a p h (b ) o f s u b s e c tio n (1) o f s e c tio n tw e n ty - e ig h t o f t h e C o m p a n i e s A c t ( N o r t h e r n I r e l a n d ) 1 9 6 0 , a r e n c t o b e in c lu d e d in r e c k o n i n g t h e n u m b e r o f fifty. Signed____----------------------- 1------ Direct U S: “ D irector ’ inclines any p e n o n who ;ccupies the ^ositioQ of i iirtc tc r 07 w hatii >*v i d . , "Christian aarne" includes a fo riu ain j, and "“ 3u r a a r a e '\ in :ho ;aj 01 a a « r or - e n c n o s w .1 / A a o W v * jurnam<;, m eans :hat title. . "F orm er C hristian nam e” and "form er surnam e” do n o t icciudc: fa) in the case of a cecr or o e n o n usually 'm ow n by a British title different rom 113 - u r - a i previous to the adoption o f or auccession to the title; or ■ I ^ * in - *'~&f\ ", ‘ = e. -1.; 4aj T “ j , ^ » JtS t'S - j 0 n ,»4' v ( V-jr (b) in the sasa o f any person, a form er Christian nam e or surname where that nam e r \ * I >■£ ii'V S . the person bearing the nam e attained the age o f si-jh t« n yea c-s or ha oeen chunked i f f l * * * * ? * ! '? •*. ’ " /■**1 , than aventy years; or . . .: v » 4 (c) in the case of a m arried wom an the nam e or surnam e by which she was know n previous , . "■ ’ . '.'i;> ■■■k j f-: T he nam es o f all bodies c o rp o ra te in c o rp o ra te d in -N o rth e rn Irelan d o f w hich *hs d i r e c t o r s i l j o V ir * a m e m b e rs e x c e p t t h a t o t h e r a n d t h a t o t h e r ’s w h o lly - o w n e d .su b sid ia rie s a n d its o r t h e i r j jo m i n e e i in th e fo rm in in s u f fic ie n t, p a r ti c u l a r s o f o t h e r d i r e c to r s h ip s s h o u ld b e lis te d o n a a rib a r a te .Ji W t aWtEi a ^f f cUt f * wS^VX uaiatc ■ fo rm . " ^ * v ritfW ? 3 $ k . D a t e s o f b i r th n e e d o n ly b e g iv e n in t h e c a s e o f a c o m p a n y w h ic h is s u o j e c t to_ s e c n p a j T o c C U i a 'j C ^ - * ( N o r t h e r n I r e l a n d ) I9 6 0 , n a m e ly , a c o m p a n y w h ic h is n o t a p r iv a te c o m p a n y o r w h ic h ',,-b e in g a. f / • » i b s i d i a r y o f a b o d y c o r p o r a t e i n c o r p o r a t e d in t h e U n i t e d K i n g d o m w h ic h is n e i t h e r a p r i v a t e .c o m p a a ’/-: g is te r e d u n d e r t h e la w r e la ti n g t o c o m p a n i e s f o r t h e d m e b e in g i n f o r c e i n G r e a t B rita in , a n d - i m m - r s c o n s t it u t io n w h ic h w o u ld , i f it h a d b e e n r e g is te r e d in N o r t h e r n I r e l a n d , e n iitle i t t o r a n k a s i ” p n v i £ j : • ■ . ■ ;. I"' ” fj y e\ W h e r e a ll t h e p a r tn e r s in a firm a r e j o i n t s e c r e ta r ie s , th e n a m e a n d p r i n c i p a l o ffic e p f ■ V \ ■1 m ■ . ’ ■ . •■ ■ ;!v ■ ' . ■ “ v -■ ■ ■ srJK « «j i •-• • CcrtLSed C o p lea o f Acconmto .... . " mmmmm ■■■■■- •• '* < ft * ^ -................ E x c e p t w h e r e th e c o m p a n y is e it h e r a p r i v a t e c o m p a n y a s d e fin e d b y s e c ti o n 2 3 o f th e C om ~am eo( A c t f o o f t W ■ _ ____ j . . . . . . . . . . . . . . - a*** ,, ?' cs*- * t h e p e r io d t o w h ic h th is r e tu r n r e la te s ( i n c l u d i n g e v e r y d o c u m e n t r e q u ir e d b y la vtr t o b e a n n e - u d ro Ln<; Salaaca ih a n d a c o p y (c e rtifie d a s a f o r e s a id ) o f t h e r e p o r t o f th e a u d ito r s , o n , a n d o f t h e , r e p o r t , o f t h e d i r e c t p r s ^ ^ ^ ^ ' e a c h su c h b a la n c e s h e e t. I f a n y s u c h b a la n c e s h e e t o r r f n m m e n t r e m iira d h v la w t o b e a n n e x e d tn e r e to fa i n 'a -'fe a t mi. . la n g u a g e t h e r e m u s t a ls o b e a n n e x e d t o t h a t b a la n c e _____ ^ ^ ( c e r tifie d in t h e p r e s c r ib e d m a n n e r t o b e a c o r r e c t t r a n s la t io n . I f a n y s u c h b a l a n C i r a i s s t a s a f o r e s a i d o r d o c u a fe p ^ i O T l {«&• i^ * s b y la w to b e a n n e x e d t h e r e to d id n o t c o m p ly w i t h t h e r e q u ir e m e n ts o f t h e la w a a i n f o r c e a t t i e d a te ^ o /th e ^ A u & y Mi re s p e c t t o th e f o r m o f b a la n c e s h e e ts o r d o c u m e n t s a f o re s a id , a s t h e c a s e m a y be,^ i h e r i m u s t b e m a d e s u c h ^ d d i t m t o a n d c o r r e c ti o n s i n t h e c o p y a s w o u ld h a v e b e e n r e q u ir e d to b e m a d e i n t h e b a la n c e s h e e t o r d o c u m e n t In ord-* flk m i m a k e it c o m p ly w ith t h e s a id r e q u ir e m e n ts , a n d t h e f a c t t h a t t h e c o p y h a J b e e n jo a m e n d e d .samt bs j i a i j d i h a V ; ' ®ip n a «fi ■ ^ •B a n k in g C o m p a n ie s j r tK j ' '^k A b a n k in g c o m p a n y , in o r d e r t o a v a il i ts e lf o f th e b e n e fit o f s. 3 8 0 o f t h e C o m p a n i e s A c t ( N o r t h e r n Ire la n d ) 19 m u s t a d d to th is r e tu r n a s t a te m e n t o f t h e n a m e s o f th e se v e ra l p la c e s w h e r e i t c a r r i e s o n b u s in e s s . « § ift * v~A * ??* «.«. '*'*- -A**• 0082J3-45 J K n p iu a l r e t u r n --M X COMPANIES REGISTRY IDB HOUSE 64 C H I C H E S T E R S T R E E T BELFAST BT1 4JX - • & N X 0 4 8 4 9 • TOitcONA TYU M IlM y PRLTD SH s TRADE AND INVES tMfcM1 The information printed below is taken from Companies Registry records as at the date shown. Ifthis information requires a m e n d m e n t use the spaces opposite. Please read the notes for guidance before completing the return. 15 MG\/ 2000 P O S T RECEIVED D A T E O F THIS R E T U R N (See note 1) The information in this return should be m a d e up to a date not later than 2 5 / 1 1 / 2 0 0 0 DAY 1 DATE O F NEXT RETURN If you wish to m a k e your next return to a date earlier than the anniversary of this return please s h o w the date here. Companies Registry will then send a form at the appropriate time. R E G I S T E R E D O F F I C E (See note 3) This is the address registered by Companies Registry BALMORAL LINK BOUCHER ROAD BELFAST BT12 6SD P R I N C I P A L B U S I N E S S ACTIVITIES (See note 4) 8659 OTHER BUSINESS SERVICES I R F R ^ T r r r r H I C O M P A N I E S RfcGi^LFilJ h DAY 1 MONTH M YEAR o ' MONTH ...... ± ..... o YEAR ' 1 ' /C n ° /T o « c o n a t v . SISTER O F M E M B E R S (bee rtoiw w, ,ar 'jss must be in- Northern Ireland l t d LTD W < ^ 2 7 ,,00 26 If the information shown needs amendment, give details below, and for secretary and director particulars, the date of any change. EGISTER O F D E B E N T U R E H O L D E R S See note 6) his address must be in Northern Ireland . .. . .. : . ~ - \ .• . " ' •• • r~’ Particulars of a n e w director or secretary m ust be notified on form 296 (see note 7) Company Secretary THOMAS MATTHEW CONATY 13 FORTWILLIAM PARK BELFAST »..*T BT15 4AL If this person has ceased to be secretary/ director please state when. DAY MONTH YEAR Particulars of a n e w director or secretary m u s t be notified on form 296 (see note 7) Director ___ /± ____CL N £ . M R THOMAS E CONATY 87 A N D E R S O N S T O W N R O A D BELFAST J ___ PfzQs£ jevo __________________________________ ft ______ C o _ BTll 9BS D A T E O F BIRTH: 2 7 / 0 3 / 1 9 2 1 NATIONALITY: IRISH OCCUPATION: DIRECTOR If this person has ceased to be a director/ secretary, please state when. _____________ ______ & - T _ ljs_ _ _ CL tS_6_ ____ DAY MONTH YEAR If the information shown needsarneridment give details below and the date of any : v ’ change. ■ • DAY If this person has ceased to be director/ secretary please state when. .... ' . MONTH 1 1 '■ • . - . • YEAR V . ■ "... .:•• S h o w any relevant current and previous directorships. DAY MONTH YEAR DAY MONTH YEAR If this person has ceased to be director/ secretary please state when. S h o w any relevant current and previous directorships. If this person has ceased to be director/ secretary please state when. G /C R O /T O M CONATY LTD I S S U E D S H A R E C A P I T A L (See note 8) Enter details of all shares in issue at the date of this return. ■ (NM / 2 7 1 1 0 0 CLASS 28 AGGREGATE NOMINAL VALUE NUMBER TOTALS LIST O F P A S T A N D P R E S E N T M E M B E R S (See note 9) (Use attached schedule and additional sheets where appropriate) A full list is required if one w a s not included with either of the last two returns Please mark appropriate box There were no changes in the period A list of changes is enclosed • □ A full list of m e m b e r s is enclosed □ ■ E L E C T I V E R E S O L U T I O N S (See note 10) (Private companies only) If an elective resolution is in force at the date of this return to dispense with annual general meetings, mark the box. If an elective resolution is in force at the date of this return to dispense with laying accounts in general meetings, mark the box. CERTIFICATE I certify that the information given in this return is true to the best of m y knowledge and belief. \ J Q ^ r Z n jU. \ / SIGNED ___ Seeretefy/Director (delete as appropriate) D A T E ______Q.\L_ Cheques should be m a d e payable to the Department of Enterprise, Trade and O O •_______________ This return includes---------continuation sheets. Investment (DETI) To w h o m should Companies Registry direct any enquiries about the information shown in this return? ____ Telephone 4 Ext.---- ARTHUR COX Earlsfort C entre ,Earlsfort T errace,D ublin 2 T el +353 1 618 0000 Fax +353 1 618 0618 Dx 27 D ublin mail@artKurcox.com http://www.artkurcox.com Lo n d o n B elfa st S t o k e s H o u s e , 1 7 -2 5 C o l l e g e S q u a r e E a st B e l fa st B T 1 6 H D T eleph on e + 4 4 2 8 9 0 2 3 0 0 0 7 Fax + 4 4 2 8 9 0 2 3 3 4 6 4 N ew York 29 L u d g a te H ill L o n d o n E C 4 M 7 JE T eleph on e + 4 4 2 0 7 2 1 3 0 4 5 0 F ax + 4 4 2 0 7 2 1 3 0 4 5 5 oi'K K t;i:nRnsa; 5 7 0 L e x in g t o n A v e n u e , 2 8 t h F loo r N e w Yo r k , N Y 1 0 0 2 2 T eleph o n e + 1 2 1 2 7 5 9 0 8 0 8 F ax + 1 2 1 2 6 8 8 3 2 3 7 voi'Rrefi-rrnvu AJL/sab Direct Dial : 618 0425 13th September 2001 BY COURIER STRICTLY PRIVATE & CONFIDENTIAL ADDRESSEE ONLY Ms. Mary Cummins, Solicitor, Office of the Inspectors to Ansbacher (Cayman) Limited, Third Floor, Trident House, Blackrock, Co Dublin. Re : Our Client: Mr. Tom Conaty Dear Ms. Cummins, I am writing further to my letter dated 23 August 2001. I have met with Mr Conaty and I enclose a statement which has been approved by Mr Conaty which deals with the issues raised in the Inspectors’ previous correspondence. I look forward to hearing from you in due course. Yours sincerely, ANDREW LENEQ^ J ames O 'D wyer Pa ul M c L a ug hlin I a n A. S c o t t J o h n G . F is h Da n ie l E. O ’C o n n o r P e ter M c La u g h l in R o b e r t B olton J o h n V O ’D wyer R o nan W alsh D o n o g h C row ley J o h n S .W a l s h M ic h a e l M e g h e n Jo s e p h Leyd en W illia m J o h n s t o n E u gene McCague N ic h o l a s G . M o o r e D e c l a n H ayes D avid O 'D o n o h o e C olm D u gg an C a rl O 'S ullivan I sabel F oley J o h n M eade C o n o r M c D o n n el l Patrick M c G o v er n G rainne H e n n e ssy S eam us G iv e n C o lin B yrne C aroline D evu n C ia r a n B olger G regory G lynn David F oley S t e p h e n H egarty D eclan D rislane S araii C u n n iff K ath leen G a rr ett PA draig 6 RI orrain D r . M ary R edm on d E liz a b e t h B o t h w e l l W illiam D ay A n d r e w L en n y J o h n M e n t o n P a tr ic k O 'B r ie n O rla O 'C o n n o r B ria n O 'G o rm a n M a rk S a u n d e r s C o nsultants : V in c e n t Wa lsh D e n is J. B e rg in C h et w o d e H amilton N u l l M c La ug hlin D r . Y von ne S cannell D r . R o b e r t C lark 1. This statement is made by me in response to the letter which I have received from the Inspectors dated 31 July 2001 and to the enclosures to that letter. 2. I am 80 years of age and unfortunately my memory is not as clear as it once was. However, I will endeavour to deal with the relevant issues as best I can below. 3. I remember that in or around the mid 1970s my company, Tom Conaty Limited, was to receive a payment o f the equivalent of approximately STG£50,000 from a French customer. This payment was being made offshore and I decided to keep this payment offshore and I then contacted Guinness & Mahon in Dublin as I knew that Guinness & Mahon had offshore operations in the Channel Islands. I am unable to recollect who I dealt with but I do remember that I was asked whether I would prefer the funds to be held in the Cayman Islands or in Guernsey. I asked for the funds to be held in Guernsey as my company carried on business there and it was therefore much more convenient for me. To the best o f my recollection, I was told that the deposit would be managed by a trust company owned by Guinness & Mahon called College Trustees. 4. The deposit was then placed with Guinness & Mahon (Guernsey) and interest accrued on the deposit (during a time of high interest rates). As far as I was aware the money was held for my benefit by College Trustees with Guiness & Mahon in Guernsey. 5. From about the late 1970s I made periodic withdrawals from this deposit. I would call into Guinness & Mahon’s offices in Dublin and I would request a withdrawal and I would then be paid in cash. 6. This position continued until the early 1990? when I became worried about the stability of Guinness & Mahon. I was aware that a Japanese bank had become involved in Guinness & Mahon and I then arranged for the deposit to be transferred to the Bank of Ireland in the Channel Islands. 7. Having reviewed the documents provided by the Inspectors, I do recollect that a facility was provided by Guinness & Mahon to Tom Conaty Limited, although I am unable to recollect any specific details in relation to this transaction. However, I do recollect that this facility was provided on the basis that I held funds with Guinness & Mahon in Guernsey which would effectively secure the facility, although I do not recollect having to ever execute any security documents in respect of the deposit in Guernsey. 8. I have never had any dealings, whether directly or indirectly with Ansbacher. I have been advised by my solicitors that the likely reason why the Inspectors have corresponded with me is that the monies deposited by me may have been placed, by College Trustees, on deposit with Ansbacher (Cayman) Limited. If this is the case, then the transfer of these funds occurred without my knowledge and was contrary to my instructions as I specifically said that the money was to be deposited in Guernsey and not in the Cayman Islands. In fact, I had never heard of Ansbacher until that name received publicity in recent times. (aj11844) Appendix XV (148) Mr Stephen Daly, deceased 1. 2. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr Stephen Daly. a) Transcript of evidence of Mr Stephen Daly dated 8 June 2000. b) Statement re file C lodgements and withdrawals prepared by Stephen Daly. c) Internal Memorandum of Guinness and Mahon Limited “Memorandum of Addition” for College Trustees Limited dated 24 January 1978. d) Letter of 2 May 2000 from Stephen Daly to Inspectors. e) Statement of account in College Trustees re a/c TC 431 of 17 August 1990. f) Statement of account in College Trustees re a/c TC 431 of 26 July 1988. g) Acknowledgement of share purchase from Guinness and Mahon of 15 July 1991. h) Letter of 21 March 1984 from College Trustees to Stephen Daly. i) Letter of 5 May 2000 from College Trustees to Stephen Daly. Correspondence received from or on behalf of Mr Stephen Daly. a) Letter of 14 November 2001 from Kennedy McGonagle Ballagh to Inspectors. UNDER OATH ON THURSDAY, 8TH JUNE 2000 I hereby certify the following to be a true and accurate transcript of my shorthand notes in the above named interview. Stenographer The Inspectors: MR. ROWAN FCA MS. MACKEY BL Solicitor to the Inspectors MS. M. CUMMINS Interviewee: MR. STEPHEN DALY 1 2 3 MS. MACKEY: Good morning, Mr. Daly. 4 I will just introduc 5 myself. 6 appointed, as you know, by the High Court to 7 investigate the affairs of Ansbacher. 8 Mr. Paul Rowan, my colleague and one of the other 9 two Inspectors. 10 not a Tribunal. 11 A. 12 I am Noreen Mackey, one of the Inspectors This is Now this is not a Court and it is I appreciate that. MS. MACKEY: 13 It is just an inquiry and this is just an interview. 14 It is, however, under oath. 15 evidence under oath and we just wanted you to be 16 clear about the position here. 17 any questions that you don't know the answer to or 18 you don't remember the answer to, just simply say 19 that. 20 21 A. We do wish to take your Now if we ask you I will, yes, indeed. MS. MACKEY: 22 That you don't remember or you don't know and that 23 will be sufficient. 24 Ms. Cummins, then, to administer the oath and we can 25 begin. 26 27 28 29 I will ask our solicitor, 1 2 3 1 Q. MS. MACKEY: Now, Mr. Daly, we 4 received your statement 5 and the documents you sent us in. 6 much, they were very helpful. 7 interview will be a matter of just clarifying and 8 going through what you have said and getting your 9 evidence on oath about it. Thank you very I think this Maybe one or two points 10 that weren't totally clear to us, you might be able 11 to clarify those if you recollect the events in 12 question. 13 A. 14 2 Q. Right. We might also just ask you to look at some of the 15 documents you sent us and maybe one or two others 16 that we have here and ask you to explain them to us, 17 if you can. That is basically how we want to 18 proceed. 19 A. 20 3 Q. Okay. Can I just for the record have a slight little bit 21 about your background? 22 your statement here that you are a retired 23 schoolteacher? 24 A. 25 4 Q. You have told us already in Correct. So if you could fill us in a little bit about that. 26 All your life from your university days, you were a 27 schoolteacher, were you? 28 A. 29 5 Q. Correct. Was this a primary or secondary primary? 1 2 6 Q. Primary schoolteacher. I think you began sometime 3 in the late 1950's or early 1960's to operate 4 charter flights from Ireland? 5 A. 6 7 Q. 7 A. 9 8 Q. 10 A. 11 9 Q. 12 A. 13 10 Q. 14 A. 15 11 Q. 16 A. 17 12 Q. 18 A. 19 13 Q. 20 A. 21 Correct. During your holidays? Correct, it was a summer activity. Yes. Now when did you retire from teaching? On 30th June 1988. You continued teaching all your life? I did. Do you now run a travel business? I do. Since your retirement, is it? Yes, correct. I see. It is an educational travel company. And that is based where? That is based in Rathgar in my own home. It is a one-man operation still. 14 Q. 23 24 You continued to do that contemporaneously with your teaching; is that correct? 8 22 Correct. I see. Is it more or less the same as you were doing all the time? A. No, the initial period from 1959 through to 1974 25 were charters. 26 when the jumbo jets came into existence around that 27 time, it was impossible to charter aircraft 28 otherwise. 29 These were Boeing 707's. It would not be practical. But then 1 educational programmes I was running for teachers 2 based at universities in the United States from 1959 3 right through in conjunction with charters. 4 the United States Office of Education and the State 5 University of New York at New Paltz in New York, 6 I inaugurated a three-week seminar so as to 7 introduce Irish teachers into the latest innovations 8 in American education. 9 15 Q 10 A Through I see . So that was a period for three weeks and then 11 followed an educational itinerary that would take 12 teachers en route to Boston, Philadelphia and 13 Washington D.C.. 14 their horizons, working with the National 15 Aeronautics and Space Administration people in 16 Washington D.C. so that teachers could actually view 17 satellites being launched and obtain the latest 18 ideas of that nature. 19 16 Q 20 I see. That was more or less to expand Do you run that business through a company now, Mr. Daly? 21 A 22 17 Q 23 A 24 18 Q 25 A 26 19 Q 27 A 28 20 Q 29 A I do indeed. The company is called? ITP, Irish Teacher Projects. Is that a company incorporated in Ireland? It is . A limited company? Correct. When was it incorporated? 1 21 Q 2 A 3 22 Q Yes . That is fine for background, thank you very much. 4 Now getting on to what we are actually concerned 5 with here and what you have explained to us. 6 appears from your statement and the documents that 7 you sent to us that you had a trust based in the 8 Channel Islands with Guinness & Mahon Guernsey and 9 managed by College Trustees, is that correct? 10 A 11 12 I hadn't a trust. It Guinness & Mahon led me into a trust situation. 23 Q Okay. Maybe we will start with how the whole thing 13 began. You first contacted Guinness & Mahon about 14 depositing money when? 15 A I would say around -- first of all, the monies were 16 with AIF or Allied Irish Finance. 17 scenario there was one of the Directors of AIF said; 18 'Listen here, I think that there is going to be an 19 investigation whereby having funds in the North 20 means no protection for you, because if there is an 21 agreement between both governments...'. 22 24 Q I think the If I could just stop you for a moment. We are not 23 so much concerned with the funds that you had in 24 other places such as AIF? 25 A 26 25 Q Yes, but I am coming to the point. I know, but what I really want to find out is that 27 you at a particular point approached Guinness & 28 Mahon in Dublin? 29 A 1 26 Q 2 3 date? A 4 I wouldn't know exactly. I would safely say maybe about 1972 or 1971. 5 27 Q 6 A 7 28 Q 8 9 Now around what time was that? Can you remember the Who did you meet there? I met a person called Martin Keane. Martin Keane. Who introduced you to Guinness & Mahon? A I read the business papers and I saw that you could 10 get a very good rate of exchange from Guinness & 11 Mahon. 12 29 Q Mr. Keane. 13 14 A 15 30 Q 16 17 So you went into Guinness & Mahon and you met This was your first meeting with him? It was, yes. And you explained to him that you had money in the North in AIF; is that right? A 18 No, I had already taken the money in a suitcase to Guinness & Mahon. 19 31 Q 20 A Before that? Well, the thing was that, that I am sure that when I 21 deposited the money initially I gave it to the 22 people who counted it and that same day Martin Keane 23 appeared on the scene. 24 32 Q So do I understand you correctly to say that without 25 any prior contact with Guinness & Mahon, you went 26 with the money in the suitcase? 27 A 28 33 Q 29 Naturally, I had phoned them. That is what I want to find out, your first contact with Guinness & Mahon? 1 2 34 Q 3 phone? 4 A 5 35 Q 6 A 7 36 Q 8 I spoke to Martin Keane. So that was your first contact with Martin Keane? Correct, yes. Did you know to ask for Martin Keane or did you just ring them and ask them who you should speak to? 9 A 10 37 Q 11 To be honest, I couldn't say. You can't remember. Anyway, you spoke to Martin Keane? 12 A 13 38 Q 14 15 So you phoned them and who did you speak to on the Yes . Did you explain to him that you had funds in the North that you wished to transfer? A 16 That is true, yes, but the funds actually were in Dublin. 17 39 Q 18 A You had already brought them down at that stage? No, sorry. It would appear that ostensibly having 19 funds in the North of Ireland meant that they were 20 with AIF. 21 Government, they would have AIF in the North of 22 Ireland but the funds were physically in Dublin. 23 least that is what I conjured up, because I didn't 24 take the funds initially from the North of Ireland 25 to Dublin. 26 Allied Irish Banks. 27 40 Q 28 A 29 41 Q Whatever accountancy they had with the The funds were in Dublin with AIF or Where had you put them initially? They would have started with my own bank. Which was? At 1 A. AIB Rathgar. AIB Rathgar would have just syphoned 2 them off to their subsidiary, which is Allied Irish 3 Finance. 4 a s ...(INTERJECTION) 5 42 Q. 6 So in fact you withdrew them from AIF in Dublin; is that right? 7 A. AIB. 8 43 Q. AIB? 9 A. 10 44 Q. 11 12 A. When you wanted to put these into Guinness & Mahon, Yes, in cash, because AIF wanted no trail, as they stated. 45 Q. I see. So there was no chegue. So these were profits from the charter of your...(INTERJECTION)? 15 16 Well, AIF. you withdraw them from AIB in cash? 13 14 So in effect, there was no such thing A. Yes, may I explain those? Initially, the Civil 17 Aeronautics Board had a regulation whereby an 18 organisation or an individual chartering for an 19 organisation would have to comply with regulations 20 which are known as Affinity Charters. 21 Affinity Charters were such that ostensibly the 22 costs of the aircraft was to be pro-rated by the 23 number of passengers and giving you -- if it was an 24 unusual situation. 25 expenses and they were doing things for a group of 26 people, a group of teachers and obtained no 27 remuneration, as it were. 28 company at the time, I was an individual. 29 at that time too, I think income tax was about 65% I was supposed to pay all my Because I was not a Actually, 1 or 68 %. 2 and day and pay everything over to tax. 3 the culture of the time. 4 manager would say put the money up the North. 5 46 Q. I didn't see why I should work night, noon That was Naturally, every bank So this money came to you how? You were explaining 6 that you would appear to work without remuneration 7 but you actually were remunerated? 8 A. 9 Naturally, the passengers of the aircraft would send me money so that I in turn could pay for the 10 aircraft. 11 unknown because you didn't know if you were going to 12 fill the aircraft. 13 and your maths were such that you divided a mythical 14 number which would be the configuration of the 15 aircraft and divided that by the costs and say that 16 XY is the amount that you are going to pay. 17 naturally, if you didn't fill, you just couldn't go 18 back to the people. 19 money in case you didn't fill. 20 47 Q. 21 A. 22 48 Q. 23 If you didn't fill the aircraft But So you always added on a sum of So you could make a profit? Correct, yes, indeed. So it was the profits of this that were in this fund in AIF? 24 A. 25 4 9 Q. 26 That is true, totally. And that was the only source of those funds; is that right? 27 A. 28 50 Q. 29 Naturally also, you were working with the Correct, yes. So getting back to Guinness & Mahon, you decided you would change this money to Guinness & Mahon and you 1 wished to have it offshore, is that basically what 2 it was? 3 A. No, I presumed initially that it would remain in 4 Guinness & Mahon but they were stating that it would 5 appear that the Irish pound and sterling were going 6 to split and that it would be far better to have 7 your money designated as sterling rather than Irish 8 punts. 9 51 Q. This was right from the start? 10 A. This was right from the start. 11 52 Q. 12 A. 13 14 This is what Martin Keane told you on the first day? That is correct. That is why he said put your money over in Guernsey. 53 Q. Right. So this suitcase of money that you brought 15 in, you understood on Day 1 that that was going to 16 Guernsey? 17 A. 18 54 Q. Yes, indeed. Did you get any independent financial or taxation 19 advice at that time about your money and what to do 20 with it? 21 A. 22 55 Q. 23 Well, I could hear rumours and talk. But did you have an accountant, a personal accountant ? 24 A. 25 56 Q. 26 A. 27 57 Q. 28 A. 29 No. No. You didn't have one at all? I didn't. Did you consult a solicitor? I didn't, no. I knew solicitors and everything 1 2 58 Q. 3 4 that be correct? A. 5 6 59 Q. So on that particular day, Mr. Keane suggested to you that the money be put into Guernsey? 8 A. 9 60 Q. 10 A. 11 61 Q. 12 A. 13 62 Q. 14 A. 15 Correct. And you agreed? I did. Did you sign documents that day opening an account? I am sure I did. I am sure I did. Did you keep copies of those documents? I wouldn't have. If I did, through the passage of time, they probably were... 63 Q. 17 18 The advice came from Guinness & Mahon, yes, indeed, yes . 7 16 So the advice all came from Guinness & Mahon, would What did Mr. Keane tell you about the account you were opening? A. All he simply told me was: 'This sum of money at the 19 moment is in Irish pounds. 20 Guernsey prior to the split being announced by the 21 Government, that we are going to separate from 22 sterling, then, in effect, it would be classified as 23 sterling. 24 appreciate and you will be outside the Irish tax 25 net. ' 26 64 Q. 27 Yes. If you put it in Therefore, your amount of money will Did he say anything to you at that time on that day about setting up a trust? 28 A. 29 65 Q. No, he did not. He did not mention a trust? 1 2 66 Q. Now that sum of money you say in your statement or 3 in the little sort of mini statement you put at the 4 beginning of File C headed "Lodgements and 5 Withdrawals", do you have a copy of that with you 6 (Exhibit 1)? 7 A. 8 67 Q. 9 I don't, no. I gave you all the copies. Right, we will give you a copy to look at. HANDED). It is page 30 of our brief. (SAME You see there 10 at Paragraph C, you talk about two very large 11 lodgements; the first one: "As stated above - 12 £ 1 2 0 ,000 ." 13 A. 14 68 Q. 15 Yes. That goes back up there to Paragraph A, where you say: 16 17 "Martin Keane transferred a sum in the region of £120,000 to Guinness Mahon Guernsey which I brought to his bank in a suitcase around December 1977." 18 19 20 A. 21 69 Q. 22 Yes. Is your evidence that that was the opening of the account or the beginning of the funds? 23 A. 24 70 Q. That was the opening of the account. Yes. Now can I just ask you then to look at a 25 document entitled: 26 your File C, I think. 27 Page 47. 28 2 )? 29 "Addition to Funds." It is in "Memorandum of Addition." You have that, do you, Mr. Daly (Exhibit 1 71 Q. You see that that Memorandum of Addition says: "On 2 24th January 1978, the trustees accepted the 3 following property and resolved to treat the same as 4 an addition to the settled funds of the trust." 5 the figure is £119,665.55. 6 A. 7 72 Q. 8 Yes. That would appear to be the sterling equivalent of £ 1 2 0 ,000 ? 9 A. 10 73 Q. 11 Yes. Would you agree that that would appear to be the sum that you are talking about? 12 A. 13 74 Q. Correct. But here it is referred to as an addition to the 14 settled trust funds, which seems to indicate that 15 there was money there already? 16 And A. My impression of that, the settled funds is that 17 they had funds -- in other words, they didn't give 18 me the impression that they were isolating me as an 19 individual but they had already funds there from 20 other sources. 21 75 Q. 22 A. 23 7 6 Q. 24 That is your understanding? That is my understanding of it. But your own understanding is that these were the first funds that you held? 25 A. 26 77 Q. Correct, they were my first funds, yes. Okay. Thank you very much. Now going back then to 27 your statement, do we have the first statement 28 (Exhibit 3)itself to have a look at? 29 If you would turn to page 2 of your statement there, (SAME HANDED) 1 2 3 4 "In 1977/1978, an official of Guinness Mr. Martin Keane, told me of an impending split." 5 Do you see that? 6 A. 7 78 Q. 8 Mahon Bank, Yes. Now that is the conversation you have just described to us so that was the beginning of this deposit? 9 A. 10 79 Q. Yes, that is true. You then say in the next paragraph: 11 12 "Since I was never in Guernsey, out of curiosity." I later went there 13 14 How much later was that? 15 A. I asked myself that question and I could not say. 16 iO Q. Can you recollect whether it was a very long time 17 afterwards or probably within the same year or a few 18 months ? 19 A. It would appear to me that I was concerned where the 20 hell these monies were and I would say that it could 21 easily have been within six months or a year. 22 31 Q. 23 A. 24 12 Q. Yes, it might have been some relatively short time. Yes. There, you were told to contact a Mr. John 25 Lipscombe, who told you that the funds were acquired 26 by College Trustees, of which he was the Director, 27 and you were annoyed about this because you had not 28 known this? 29 1 83 Q 2 Yes. So that was the first you learned that College Trustees were looking after your funds? 3 A 4 84 Q Correct. You then go on to say in the next paragraph: 5 6 "I was told that this was in my own interest." 7 Now by that, do you mean that it was in your own 8 interest that College Trustees was looking after the 9 funds, is that what they told you? 10 A 11 12 It would appear when that was stated to me, it was that 'the monies are no longer in your own name.' 85 Q 13 Now that is what I am coming to. Did Mr. Lipscombe say that to you? 14 A 15 86 Q 16 A 17 87 Q 18 A 19 88 Q 20 A 21 89 Q 22 He did. Whose name did he say they were in? They were in College Trustees'. They were in the name of College Trustees? Correct, yes. Not just being managed by them but in their name? No, no, in their name. Right. You then go on to say: "I was asked to fill out a letter of wishes." 23 A 24 90 Q Correct. Now what did he say to you about that? When he 25 produced that letter of wishes to you, what did he 26 say that was? 27 A 28 29 If I died, who was I going to give the money to? And I just thought of my own relatives. 91 Q 1 2 He did. 3 92 Q 4 A 5 93 Q He did tell you? He did, yes. I see. So at that point, at that meeting with 6 Mr. Lipscombe, you learned that your money was 7 actually in trust? 8 A 9 94 Q 10 A 11 95 Q 12 A 13 96 Q 14 15 But you had not known that up to that point? No. Did he tell you what the name of the trust was? College Trustees. College Trustees were the trustees of the trust, actually. A 16 17 Correct. I beg your pardon. But that was the only name that ever stuck in my mind. 97 Q Very good. So he told you that in fact your monies 18 were in trust and that College Trusties were looking 19 after it? 20 A 21 98 Q 22 A 23 99 Q 24 A 25 100 Q 26 A Correct, yes. And that was it, it was no longer in your own name? That is true. And then you wrote a letter of wishes? That is true. Did you agree to all of this then when he told you? I could see the logic of it from a technical tax 27 point of view that I was not going to have Stephen 28 Daly with all these funds, that I was going to have 29 this mechanism, and I looked upon it purely as a 1 mechanism, whereby College Trustees would be 2 responsible and, as it were, own the monies. 3 through the letter of wishes, that should anything 4 happen to me my funds would be distributed to those 5 I had put on the letter of wishes. 6 101 Q 7 A 8 9 Did he show you on that occasion a trust deed? No. If he did, all I did was just sign whatever document he asked me to sign. 102 Q 10 11 But Did he explain to you what a trust was or did you understand what a trust was? A In my own layman manner, I presumed a trust was a 12 legal document or a legal instrument whereby my 13 monies would be protected by the law of what they 14 were trying to inform me about it. 15 103 Q Did he explain to you that in order to create a 16 trust, someone had to transfer the funds to trustees 17 who then looked after it legally? In other words, 18 that you would have to transfer your funds to 19 trustees lawfully and legally? 20 that to you? 21 To be quite honest, I wasn't transferring the funds. 22 I didn't know what had happened to the funds but 23 Guinness & Mahon had transferred funds. 24 what annoyed me, that Martin Keane never told me 25 that on the funds reaching the shores of Guernsey, 26 they were going to go into a trust. 27 I was quite concerned myself, I just wanted to find 28 out was there a bank, a physical building and what 29 kind of a set-up was it. Did they explain This is But because I simply happened to meet 1 2 104 Q 3 4 Did you not ask Mr. Keane for these details before you went over? A No. As far as I was concerned, I was giving my 5 monies into the hands of Guinness & Mahon who had a 6 branch in Guernsey. 7 105 Q 8 9 But as you just said now, you were concerned a bit about it and wondering was this a bank? A Naturally. Well, I suppose that word "concern" has 10 to be tinged with the fact that I had never been to 11 Guernsey before and that, okay, I had some holiday 12 and I went over just on a day basis. 13 is not... 14 106 Q 15 So the concern In any event, Mr. Keane did not tell you, you are quite clear about that, that the money was in trust? 16 A 17 107 Q 18 Very clear. And the first that you learned of it was from Mr. Lipscombe? 19 A 20 108 Q 21 Correct. Was it Mr. Lipscombe who told you that the number of your account was "TC431"? 22 A 23 109 Q 24 I doubt if that registered with me. You have that in your statement (Exhibit 3), in that paragraph? 25 A 26 110 Q What paragraph was it? The fifth paragraph down on page 2, the last 27 sentence. 28 My number was "TC431". 29 somebody now being branded with a number on his But that is now like 1 2 111 Q 3 What I am asking you is did Mr. Lipscombe give you that number? 4 A 5 112 Q 6 A 7 No, he didn't. So when did you learn that that was your number? I think when I forced Mr. Lipscombe to tell me what he was doing with my monies. 8 113 Q 9 A On that day? No, not on that day. You will recall a 1984 10 document there when I went over and I asked 11 Mr. Lipscombe and he said that they were with 12 Rothschild. 13 114 Q 14 A 15 16 Yes, you referred to that in your statement. I presume that it was at that stage I might have learned the number of TC431. 115 Q 17 I see. Now does the name Creebridge Investments mean anything to you, Mr. Daly? 18 A 19 116 Q 20 A 21 117 Q 22 A 23 118 Q Sorry. Creebridge Investments? Never heard of it. You never heard of Creebridge Investments? No. If we can look again at your File C there, your 24 document "lodgements and withdrawals" 25 you refer there at Paragraph D to a withdrawal of 26 £10,000 cash from Guinness & Mahon Dublin on 2nd 27 August 1990? 28 29 A (Exhibit 1), Yes . "A Mr. Murray or a Mr. Farrelly of Guinness & Mahon 21 1 2 3 120 Q. 4 5 Can you tell me how that came about, that you withdrew money from Guinness & Mahon? A. I called up Guinness & Mahon and I asked them could 6 I have £ 10,000 of my own money and could they get it 7 for me. 8 121 Q. 9 Guernsey? 10 A. 11 122 Q. 12 13 So you were talking about the money that was in I was, yes. But why would you ring Guinness & Mahon in Dublin about that? A. The thing is this, they were the parent body and 14 they had direct contact with Guinness & Mahon in 15 Guernsey. 16 123 Q. 17 A. 18 124 Q. 19 20 In relation to your account? Correct. Had you had contact with them before in relation to your account? A. With regard to -- well, I believe that College 21 Trustees and Guinness & Mahon were one and the same 22 operation. 23 125 Q. I am more concerned to know what actually happened 24 or what you were actually told than with your 25 interpretation of the events at the moment. 26 what I am really concerned to find out here is why 27 did you believe you could ring up Guinness & Mahon 28 in order to withdraw money that you had in Guernsey? 29 Had anyone in Guinness & Mahon given you to But 1 2 A. 3 demand. 4 126 Q. 5 A. 6 127 Q. 7 A. 8 128 Q. 9 A. 10 129 Q. 11 A. 12 130 Q. 13 14 I am sure I felt myself that I could justify my But had anyone in Guinness & Mahon told you this? No. They hadn't? They hadn't, no. And had you ever done it before? No, this was my first withdrawal. Your first withdrawal at all from the accounts ? At all from the accounts. So you rang up Guinness & Mahon. Mr. Martin Keane, was it? A. No, Martin Keane was either not in my mind at the 15 time but I did know that there was a Mr. Farrelly 16 there, through relations of mine that their son was 17 in Guinness & Mahon. 18 so far as I recall. 19 engineer this for me?'. 20 131 Q. 21 So I called up Brian Farrelly, I said; 'Brian, could you Did you tell him what you were talking about, your particular account? 22 A. 23 132 Q. 24 A. 25 133 Q. 26 A. Yes, he knew all about it. Did you tell him it was a trust? Well, he knew that too. How did he know? The point is this; as far as I am concerned, and 27 this is a presumption on my part, that anybody with 28 monies that initially originated from Guinness & 29 Mahon to Guinness Mahon Guernsey to College Trustees 1 were quite well aware of the line of communication. 2 Right. 3 mean, I presume not everybody in Guinness & Mahon 4 would know your personal affairs over in Guernsey so 5 was he a person who was dealing with the Guernsey 6 branch? 7 A 8 This Mr. Farrelly, was he concerned -- I No, but I asked him could he find out could it be done. 9 135 Q 10 A 11 136 Q 12 A 13 137 Q 14 But you said that he knew all about it anyway? He knew all about it when I finished talking to him. He only knew about it because you told him? That is true. That was my first question. Did you explain to him that you had a trust in Guernsey? 15 A 16 138 Q 17 A 18 139 Q 19 I did, yes. Up to that, he didn't know anything about it? I don't know, I don't know. You told him that you had monies in trust and that your account number was "TC431", did you? 20 A 21 140 Q 22 A I didn't. I wouldn't have told him that. So how would he know? I am quite certain that all he would have to do was 23 ring up Guinness & Mahon in Guernsey and then that 24 particular request would be forwarded on to a person 25 called Brian Ellis. 26 Lipscombe retired. 27 Did you explain to Mr. Farrelly that this money was 28 not in your own name over there? 29 to refer to it? He was the person when Mr. How would he know 1 2 142 Q 3 A 4 143 Q 5 A So what exactly did you ask him when you rang up? Could I have a loan of £10,000. A loan? Well, he would know it wasn't a loan. But in other 6 words, I am sure I would have asked him, as I think 7 I was going to invest it in the Stock Exchange, 8 either Irish Life, they were all coming on-stream at 9 the time. 10 11 And that is all I can say. talking about what year? 144 Q Yes, 1990. You are 1990, isn't it? But I am just wondering why you would 12 have asked him if you could have a loan. 13 talking about your own money? 14 A 15 145 Q 16 A 17 146 Q 18 You were I was talking about my own money, yes. Why would you put it that way? I suppose a loan of your own money. One wouldn't get it, would they? You wished to use some of your money that was in Guernsey? 19 A 20 147 Q 21 Correct. And you believed that Guinness & Mahon in Dublin would be able to organise that for you? 22 A 23 148 Q Yes . So nevertheless what you did was you rang up 24 Guinness & Mahon, a Mr. Farrelly, and you asked if 25 you could have a loan of £ 1 0 ,000 , is that right? 26 A Yes. Well, I am sure I didn't use those exact 27 words, but could he arrange to have £ 10 ,000 of my 28 money. 29 that. Again, I may not have been as explicit as If you wish to interpret, what I am trying to 1 say is could I get £10,000 from Guernsey and they 2 knew what that would mean. 3 149 Q 4 Yes. Now a long time had passed since you first went in to Mr. Keane with the suitcase? 5 A 6 150 Q 7 Yes . Had you any contact with Guinness & Mahon in Dublin in the meantime? 8 A 9 151 Q 10 I am sure I had. In relation to your account in Guernsey or in relation to something else? 11 A 12 152 Q In relation to my account in Guernsey. Right. So you would have been dealing through 13 Guinness & Mahon in Dublin in relation to your 14 account in Guernsey? 15 A 16 153 Q What dealings would you have had in relation to it? 17 A I know that since John Lipscombe stated that he had Correct. Yes, indeed. 18 the funds with Rothschild and that they were 19 engaging in exchange, I was quite certain that I 20 wondered what on earth was the state of play with my 21 money, what form was it in and they would tell me. 22 154 Q 23 A 24 155 Q 25 A 26 27 Correct. Was your money in different currencies? It was, placed by College Trustees through Rothschild. 156 Q Right. On whose advice had you put it into different currencies? 28 29 Guinness & Mahon would? A 1 157 Q 2 A 3 158 Q 4 It would be Brian Ellis that would be managing that. But would he have put it into different currencies on your instructions? 5 A 6 159 Q 7 A Not necessarily on my instructions. Then whose? I am sure that if he wanted to maximise whatever 8 monies that he was managing, they were the trustees, 9 they were the managers. My connection with him was 10 he would call me and state; 11 deducted from your account our fees and your money 12 is either in sterling or it is in Deutsch marks or 13 it is in dollars.' 14 160 Q 15 A 16 161 Q 17 'You owe us and we have And you would be happy with that? I would be happy with that. But he would tell you on each occasion which it was in? 18 A 19 162 Q He would, yes. Were you aware -- well, you are now because you sent 20 us copies of the statements -- that you had a dollar 21 account, a Deutsch mark account...(INTERJECTION) 22 A 23 163 Q 24 Yes. But I didn't have exact sums. Now the money that you withdrew on 2nd August 1990, you say that that is £10,000 cash? 25 A 26 164 Q 27 A 28 29 Yes, indeed. Yes . Could it have been 10,000 Deutch marks? No. Well, if it were 10,000 Deutch marks, certainly I didn't get it in Deutch marks. 165 Q Right. Can I ask you to look at page 90 of our 27 1 brief, which is a Guinness & Mahon statement. 2 is a statement issued by Guinness & Mahon in Dublin. 3 As you can see there, the date on it -- do we have 4 the date on it (Exhibit 4)? 5 A. 6 166 Q. This 2nd August 1990. That is right. The cash withdrawn: 10,000. 7 That equates with the date and it equates with the 8 amount. 9 can see the word Deutsch marks: But over on the left-hand side of that, you 10 which is deposit account, 11 see that there? 12 A. 13 167 Q. 14 A. 15 168 Q. "External Call D/A," "Deutsch marks." Do you Yes, indeed, I see Deutsch marks. So this is a Deutsch mark account? I don't know whether it is a Deutsch mark account. It is stated to be a Deutsch mark account. If you 16 see up at the top there where the heading is: 17 "College Trustees." 18 A. 19 169 Q. 20 Do you see that? Yes. Over to the right of that, you have College Trustees again and then you have "re account TC431." 21 A. 22 170 Q. 23 A. 24 171 Q. Yes. So that refers to your account? Correct, yes, it does. But it is an account then in the name of College 25 Trustees re "TC431" held in Guinness & Mahon in 26 Dublin in Deutsch marks from which 10,000 Deutsch 27 marks were withdrawn on 10th August 1990? 28 A. 29 172 Q. Yes. I have presumed that that was punts. Did you get it in cash or in a draft or what way was 1 2 3 173 Q 4 account but turned into Irish currency for you? 5 A 6 174 Q 7 8 More than likely, yes, indeed. Which would mean that it wasn't exactly £10,000, could that have been possible? A 9 I wondered why and I thought it was punts and that it was being used to purchase some of the shares 10 11 So perhaps it was taken out of a Deutsch mark that was floating at the time. 175 Q I see. Were you aware that you had a Deutsch mark 12 account in the name of College Trustees in Guinness 13 & Mahon in Dublin? 14 A 15 176 Q 16 A Yes, I did indeed. In Guinness & Mahon in Dublin? The thing is this; I am not an accountant and the 17 monies I thought all along were in Guernsey but then 18 they could be in Dublin. 19 177 Q When you say that they could be in Dublin, did you 20 know they were in Dublin or that any of your money 21 was in Dublin? 22 A I presumed that this interlinkage between Guernsey 23 and Dublin, that as far as I could see, the monies 24 could be in either Guernsey or Dublin. 25 just writing bits of paper. 26 Yes, I see. 27 now that your money was in a trust managed by 28 College Trustees in the Channel Islands in Guernsey 29 as far as you knew at the time? Very well. They were Anyway, we have established 1 2 179 Q. Now can I ask you to look at another statement from 3 Guinness & Mahon in Dublin. 4 (Exhibit 5) 5 is an earlier one in the same series that we just 6 saw the withdrawal from there. 7 headed: 8 you see that? 9 A. 10 180 Q. 11 This is page 59 (SAME HANDED TO THE WITNESS). Now this This time, it is "Guinness Mahon Cayman Trust/College." Do I do. Up at the top again on the right: "Guinness Mahon Cayman Trust/College re account TC431." 12 A. 13 181 Q. Right, okay. What this is, I will just explain it to you, this is 14 an account held in Guinness & Mahon in Dublin in the 15 name of Guinness Mahon Cayman Trust, which was a 16 former name of Ansbacher? 17 A. 18 182 Q. Yes. Ansbacher originally was called Guinness Mahon Cayman Trust? 19 20 A. 21 183 Q. Yes. With the reference "College" and I do not know if 22 you are aware from the media or aware from your own 23 knowledge that around 1981, College Trustees placed 24 some of the funds that it held on behalf of Irish 25 residents in an account in Guinness Mahon in Dublin 26 called Guinness Mahon Cayman Trust. 27 then invested them in Ansbacher? 28 A. 29 184 Q. In other words, Yes. That account was called Guinness & Mahon Cayman 1 2 3 Yes . 185 Q That is what this is and it has an individual 4 reference to your particular account so that your 5 particular funds can be identified? 6 A 7 186 Q 8 So this is the link between College Trustees and our investigations, as far as you are concerned? 9 A 10 187 Q 11 12 It has, yes. I know, yes. I just wanted to point out to you why we are looking at your affairs at all. A May I say that I had often heard of the word 13 "Ansbacher" through the press in relation to so many 14 different people and I was quite content that my 15 particular funds were in Guernsey. 16 horror, I said 'I am linked', but I didn't know how. 17 188 Q Yes. This is how. It was College Trustees placing 18 funds on deposit. 19 been done without your knowledge. 20 A 21 189 Q 22 But I accept that this may have Certainly. But on the face of this document, would you agree that this relates to your funds? 23 A 24 190 Q 25 A 26 191 Q 27 A 28 192 Q 29 Then to my It does indeed. You are "TC431"? I am indeed, yes. And this is your Deutsch mark funds here? Yes . Held, as it happens, in this account of Ansbacher in Guinness & Mahon? 1 Correct. 2 was shocked and surprised and a bit annoyed that I 3 had never been told by Martin Keane about these 4 College Trustees and that there was a fait accompli, 5 that they had my funds and I did not authorise nor 6 did I know. 7 193 Q At the very beginning when I stated that I I understand, yes. Just to finalise the whole 8 picture then, you have told us in your statement and 9 you have provided us with documents, very kindly, 10 that you settled up your affairs with the Revenue in 11 1994? 12 A 13 194 Q I did, yes. But is it the case, and we have to ask this for the 14 record, that up to that date you had not in fact 15 disclosed to the Revenue or you were not disclosing 16 at the time? 17 A 18 195 Q 19 None whatsoever. Not alone the interest accruing on these accounts but the monies that you had lodged to them? 20 A 21 196 Q 22 A 23 197 Q Correct, yes, that is true. But then you sorted all of that out? I did, yes. Now I think we will just take a 10-minute break and 24 you can have a cup of tea or coffee there. Then we 25 will come back and continue, we may not be much 26 longer. 27 Okay. Thank you, Mr. Daly. 28 29 SHORT ADJOURNMENT 1 2 have really one or two 3 more questions which Mr. Rowan would like to ask 4 you. 5 much longer. 6 MR. ROWAN: I don't think we will be needing to keep you Mr. Daly, in your 7 statement (Exhibit 3) to 8 us on page 2 of your letter, at the top in the 9 second paragraph, you say: 10 11 "The monies from my trans-Atlantic operation profits to the United States were placed on deposit with Guinness & Mahon on a rollover basis and were only used by me as stated on the document in File C marked "withdrawals" on specified dates as per my dairy." 12 13 14 15 A 16 199 Q 17 A Yes . So you have diary records of these matters? No, I have not. I have a personal diary and if per 18 chance I note something special, I would put it in 19 it. 20 diaries I had and I was happy to see that in 21 endeavouring to answer all your questions, I just 22 flicked through my personal diaries and I saw that 23 on 2nd August I had withdrawn a sum of £10,000, 24 put down £ 1 0 ,000 . 25 200 Q 26 27 I just happened to go back on an old bunch of I I mean, a diary is a contemporaneous record, I suppose, is it not? A It is indeed, provided it deals with -- well, it was 28 dealing with my personal life because I had no need 29 to be concerned with the in and out of monies which 1 2 In terms of keeping or maintaining a contemporaneous 3 record, I put it in an extravagant sort of way, but 4 if you had withdrawn £ 1 0 ,000 , or 10,000 punts, 5 I think you said, you wouldn't have written down 6 10,000 punts if you had withdrawn 10,000 Deutsch 7 mark? 8 A 9 That is a good point. I cannot answer it. To be honest with you, I do know that I spotted in 10 leafing through the various pages that I had 11 withdrawn 1 0 ,000 . 12 punts. 13 202 Q I presume that it was 10,000 Can I ask you then as a way of clarifying this 14 because I suppose there is a way of clarifying it, 15 you wanted to buy into some equity stocks? 16 A 17 203 Q 18 I think I am right in saying that you asked Guinness & Mahon to acquire those on your behalf? 19 A 20 204 Q 21 22 I would presume so. Correct. So that you would have given that money to Guinness & Mahon? A I did not give them the money. As far as I can 23 recall, I asked them to use the monies that I knew 24 they could get access to for the purchase. 25 205 Q So effectively, by saying to them; 'Go to my deposit 26 and get the money out to buy the shares with.', that 27 would effectively have been a withdrawal as well, 28 wouldn't it? 29 1 206 Q 2 A 3 4 2nd August. is it not? 207 Q That is the one you are referring to, 1 0 ,000 ? I am just a little confused, which is what I am 5 trying to clarify, of course, is that earlier in 6 your interview we thought we were dealing with a 7 confusion in August of you withdrawing 10,000 punts 8 when the record we had showed 10,000 Deutsch marks. 9 Are you saying that those are different issues? 10 A To be honest with you, I am not sure because I never 11 asked Guinness & Mahon what precisely is the state 12 of the amount of money; are they in Deutsch marks, 13 sterling, whatever. 14 on leafing through my diary, I saw a withdrawal of 15 10,000 punts, or which I thought were punts, I am 16 sure. 17 208 Q 18 A So all I can tell you is that This is 10 years ago. Yes, of course. Consequently, I cannot be specific other than the 19 fact that, to the best of my knowledge, I withdrew 20 £ 1 0 ,000 . 21 209 Q Maybe we will just clarify what you had said to us 22 earlier, that the £ 10,000 punts, I think you said 23 you got in cash? 24 A 25 210 Q 26 A 27 211 Q 28 29 As far as I can recall, yes. You said that you thought you got it in cash? Yes, yes. So that that money was not used for your investments? A 1 212 Q 2 A Yes, and I am trying to establish the purpose. 3 In fact, when I quizzed myself as to what was this 4 10,000 used for, I initially thought could it have 5 been for the acquisition of shares in Irish Life or 6 Greencore or whatever else, stocks that were 7 available at the time. 8 only time that I ever used what I thought were 9 personal monies. 10 213 Q But I do know it was the But I think just so that we don't end up being 11 confused and in order to clarify things, you don't 12 believe that the 10,000 punts which you believe you 13 got in cash from Guinness & Mahon, you don't believe 14 that that was used for acquiring equity stocks? 15 A I think you are quite right, that if I per chance 16 got £ 10,000 in notes or whatever, that it would 17 certainly not have been used for the acquisition of 18 stocks and shares. 19 214 Q Alright. In the alternative, you did say a few 20 minutes ago that you believed that the money which 21 was used by Guinness & Mahon to acquire equity 22 stocks on your behalf was money which you believed 23 they were able to get out of your deposit account? 24 A Yes . 25 Can you remember broadly, Mr. Daly, what value of 26 stocks you instructed them to buy and what were 27 those stocks? 28 I know that one was Irish Life, I think. 29 In fact, 1 2 216 Q. 3 There was a reference to Irish Life shares and there was also a reference to Greencore shares? 4 A. 5 217 Q. 6 A. That they had purchased on my behalf? 7 218 Q. That you instructed them to purchase. 8 A. 9 That is right, yes. Were there others? There may have been. You are talking a span of 35 years, nearly. 10 219 Q. 11 A. No, I thought we were talking about 1992 otherwise? Oh certainly not, that is the definite answer to 12 those. 13 Wireless, but I presume that was done in the 1980's. 14 220 Q. It could have been a share called Cable & At page 50, (SAME HANDED) This, Mr. Daly, is a 15 Guinness & Mahon contract note showing that on 16 15th July 1991, they purchased on your behalf 5,000 17 Irish Life shares 18 A. 19 221 Q. (Exhibit 6 )? That is right. This further document is a letter on Guinness & 20 Mahon stationery dated 21st June 1991 showing that 21 they enclosed a share certificate for 1, 0 0 0 shares 22 in Greencore (Exhibit 7)? 23 A. 24 222 Q. 25 That is right. Yes, of course. I supplied that letter myself. So that was in 1991 that those shares were being purchased? 26 A. 27 223 Q. Yes. The impression that you gave us earlier was that the 28 cost of those acquisitions would have been 29 effectively money taken from your deposit account? 1 2 224 Q 3 4 Can you remember now whether there were any other share purchases around that time? A As far as I can gather, no. But then again, it 5 would all depend on what -- the big features, Irish 6 Life was one, Greencore. 7 the 80's which is known as Cable & Wireless. 8 225 Q 9 There may have been one in Would Guinness & Mahon also have acted for you in that case? 10 A 11 226 Q Oh, they would have. Following this interview, would you please ask 12 Guinness & Mahon to provide you with full details of 13 any investments that they acquired or disposed of on 14 your behalf during the period that we have been 15 considering? 16 A 17 227 Q 18 19 Certainly. I have already asked them. Was it a fact the funds for share acquisitions came out of your trust account? A Certainly. May I state that I have already written 20 to them because they had sent me a letter earlier to 21 the effect that they were in negotiations with 22 Revenue or with yourselves and consequently that 23 should I require any documentation to write to them. 24 On the foot of that letter, I enclosed that very 25 same letter and I asked them; 26 documentation', because I am being interviewed by 27 you people. 28 fact of the matter was that I didn't hear from them. 29 Okay. 'Now I need Excuse the language there. But the 1 A. I got a letter stating that because there was an 2 invasion into their offices by Revenue going back 3 over inumerable years that they were unable to help 4 me . 5 229 Q. I am sure you can well imagine that there may have 6 been one or two other people requesting information 7 from them and I think that what may be the case is 8 that sometimes one has to be a bit specific as to 9 what one wants, therefore directing them to look in 10 a particular place. 11 going to have be a bit more specific with them as to 12 what information you want? 13 A. 14 15 So it may well be that you are What I wanted was all statements that they could give me regarding my account or my affairs. 230 Q. Yes. It may be that if you ask them specifically 16 about investments that they will go to a different 17 part of their organisation and ask that department? 18 A. Yes, indeed, quite true, but I can tell you 19 specifically so far as I was concerned there was 20 only one other share way back in the 80's and that 21 was Cable & Wireless. 22 as here, with Irish Life. 23 231 Q. Thank you. The other two are Greencore, When Ms. Mackey was asking you about 24 your initial contact with Guinness & Mahon, you 25 indicated that you had observed from the Press that 26 they were in the business of offering attractive 27 rates and that was what caused you to make contact 28 with them in the first place. 29 interview today, something of that sort you Early on in your 1 2 Yes . 3 232 Q 4 A 5 233 Q And that you made contact with a Mr. Martin Keane? Correct. Looking back at the notes that I made of your answer 6 to M s . Mackey, you said that you made your first 7 approach to Guinness & Mahon around 1972, possibly 8 1971? 9 A May I claim that memory here is conjecture on my 10 part, but I do know that the train of thought 11 running through my mind was why on earth should 12 I have to take cash from Allied Irish Banks? 13 as I was concerned, the answer I was given was 'we 14 want to get rid of your funds and we don't want to 15 leave any trace or money trail. 16 case.' 17 to me that there is going to be total disclosure of 18 people having funds in the North of Ireland. 19 that probably was the reason why I took the money in 20 the... 21 234 Q As far Take the money in a And that is what I did because it was told So Yes, I appreciate the general point you are making. 22 What I was trying to be a little clear about was 23 that the impression that I gained listening to your 24 answers was that you first made contact with 25 Guinness & Mahon in the early 70's? 26 I think so. 27 that I did receive, that I did hold onto, was the 28 College Trustees whereby they had an instrument. 29 There is a blank. But the document 1 235 Q 2 A But as far as I was concerned, monies that 3 I probably was still gaining was in the hands of 4 AIF. 5 236 Q Yes. I was going to say that you may recall the 6 document on page 47, 7 was headed up: "Memorandum of Addition." 8 A 9 237 Q 10 A 11 238 Q (Exhibit 2) this document which Yes . Do you remember that? That is right, yes, indeed. When we were asking you about that document (Exhibit 12 2 ) which you provided to us, the handwritten sum 13 £119,665.55, you indicated that that was the first 14 lodgement that you made to Guinness & Mahon and you 15 will see that that is dated 1978? 16 A Yes, indeed. May I say that this is the first 17 document that I could prove to myself that I had 18 funds, that I gave them funds. 19 of me see... 20 addition to the settled funds of the trust". 21 239 Q I can't for the life "Resolve to treat the same as an Yes, I think the point which I am sure you can 22 appreciate, is that you said in answer to the 23 general question when did you first make contact 24 with them, you said 1971/1972. 25 is quite a span of years there. 26 A This is 1978. There I am not saying that my recollection is quite 27 precise and exact, that there was money lodged in 28 1971/1972. 29 Would your personal diary have thrown some light on 41 1 the thing? 2 written in your diary that you had an appointment 3 with Martin Keane on 24th January 1978. 4 write appointment details in your diary? 5 A. I do now. For instance, presumably you would have I do now since... Do you The company was 6 inaugurated in 1973 or 1974 but amongst a whole 7 plethora o f ...(INTERJECTION) 8 241 Q. 9 A. This is your present company? Yes. But I think myself the diaries I held from say 10 the 1970's would be a plethora of school children's 11 remarks, things I would have to do regarding 12 exercises and I don't believe I was ever writing my 13 diary as something which was important to me unless 14 regarding the 10,000 on August 2nd, that sticks out 15 like a sore thumb. 16 242 Q. Equally, of course, if you were going to deposit 17 £ 120, 000 odd, that might have just found an entry in 18 your diary as well? 19 A. It certainly did because there is a rather amusing 20 story about the second time that I went up the North 21 and I had all the money stuck in a big bag and 22 unfortunately I was hungry and went into a hotel and 23 carrying a bag underneath a table in a hotel, it was 24 afterwards that I suddenly realised the significance 25 of such a stupid thing. 26 vividly that day going up to Newry and depositing 27 the money in the Bank of Ireland up there. 28 29 243 Q. But I can recall quite What I would like you to do for us, if you would, 1 y o u r d i a r y a n d s e e if y o u r d i a r i e s t h r o w a n y l i g h t 2 on wh e n you might 3 Guinness 4 it i n f a c t n o t u n t i l 5 that , 6 Certainly, 7 244 Q first have made contact with & Mahon. W a s it i n t h e e a r l y 7 0 's o r w a s if yo u would, 1978? I w o u l d l i k e t o y o u do please. yes. I w o u l d like yo u a l s o to m a k e c o n t a c t w i t h A I B an d 8 se e if t h e y c a n l o o k b a c k i n t h e i r b a n k i n g r e c o r d s 9 t o e s t a b l i s h w h e n in f a c t t h e t r a n s a c t i o n s w i t h 10 A l l i e d Irish Finance stopped, 11 i n 19 78 o r e a r l i e r ? 12 A 13 24 5 Q I c e r t a i n l y shall. Yes. Ms. w h e t h e r i n f a c t it w a s M a y I t a k e a n o t e of t h e s e ? Cummins will remind you about these things 14 t h a t w e h a v e a s k e d y o u t o do at t h e e n d o f th i s . 15 We m a y f o l lo w that up w i t h a l etter to you about 16 them. 17 A 18 246 Q Right. Mr. Daly, just t u r n i n g to File C of y o u r d o c u m e n t 19 ( E x h i b i t 1) t h a t is t h e " l o d g e m e n t s a n d 20 withdrawals", 21 A l l i e d Irish Finance monies. 22 second lodgement, 23 £128,234.96? 24 A 25 247 Q 26 A 27 248 Q 28 29 at p o i n t (c) w e h a v e d i s c u s s e d t h e Then you say the l a r g e l o d g e m e n t w a s o n e of Yes . This was from the Bank of Ireland? Correct. We haven't d i s c u s s e d that account. So yo u h a d a s e c o n d a c c o u n t in t h e B a n k o f I r e l a n d ? A 1 T h e f i r s t one, 2 to G u i nness 3 across the border. 4 v e r y s p e c i f i c b e c a u s e it g i v e s t h e e x a c t a m o u n t as 5 c o u n t e d b y Ban k of Ireland and I t h i n k I d i d enclose 6 a d o c u m e n t to t h a t e f f e c t w h e r e b y w h e n t h e m o n i e s 7 w e r e b e i n g t r a n s f e r r e d to t h e I s l e o f M a n -- I t h i n k 8 it is t h e r e . 9 MS. MACKEY: Yes, MR. ROWAN: So t h e s e c o n d l a r g e 10 24 9 Q. I h a v e t o l d you, & Mahon. that I brought down The s e c o n d one I br o u g h t S o t h e s e c o n d o n e w h e r e it is 11 we h a v e tha t . lodgement was also m o n e y 12 w h i c h s t a r t e d of f in A l l i e d I r i s h F i n a n c e ? 13 A. 14 25 0 Q. 15 Correct. A n d y o u t o o k it to N e w r y , t h e B a n k of I r e l a n d , and t h e y t r a n s m i t t e d it o n? 16 A. 17 25 1 Q. 18 Correct. T h a t w a s o n 8 t h F e b r u a r y 1983, a c c o r d i n g to the B ank of I r e l a n d s t a t e m e n t ? 19 A. 20 252 Q. 21 T h a t is r i g h t , T h a n k you. yes, t h a t is c o r r e c t . O n p a g e 45, t h i s is a l e t t e r f r o m C o l l e g e T r u s t e e s o f 2 1 s t M a r c h 1 98 4 22 A. 23 25 3 Q. ( E x h i b i t 8)? Yes. It r e f e r s to C o l l e g e T r u s t e e s a c c o u n t "TC431" 24 holding p a r t icipating redeemable preference shares 25 of US 1 c e n t e a c h i n a c o m p a n y c a l l e d O l d C o u r t 26 International Reserves Limited? 27 A. 28 254 Q. 29 Yes. So t h a t w o u l d h a v e b e e n a n o t h e r i n v e s t m e n t w h i c h w a s 1 2 25 5 Q. W a s t h e d e c i s i o n to i n v e s t in O l d C o u r t 3 I n t e r n a t i o n a l R e s e r v e s L i m i t e d a d e c i s i o n of y o urs 4 or a d e c i s i o n of the t r u s t e e s ? 5 A. A d e c i s i o n of the tru s t e e s b e c a u s e I found that 6 i n i t i a l l y t h e m o n e y w a s l y i n g in a c i t y a c c o u n t 7 e a r n i n g n o t h i n g or a v e r y small i n t e r e st rate a nd I 8 h a d lost c ontrol of the m o n e y and I was quite 9 annoyed and very angry that they were actually 10 11 s i t t i n g o n m y m o n i e s a n d it w a s n ' t w o r k i n g p r o p e r l y . 2 5 6 Q. 12 So y o u a s k e d t h e m to d o s o m e t h i n g a b o u t it? 13 A. 14 257 Q. 15 16 Alright. I did, yes. A n d t h e y c a m e b a c k to y o u a n d said ; p r o p o s a l .'? A. T h e y came b a c k to m e a f t e r I h a d m a d e m y p a r t i c u l a r 17 c r i t i c i s m o f t h e m a n d t h e y s a id ; 18 It w a s n ' t 19 n e e d it in a l e t t e r f o r m . ' 20 258 Q. 22 a c c o r d i n g to t h e t h i r d p a r a g r a p h . 23 what that A. 25 2 5 9 Q. 26 h e r e it i s . ' ' Li st en , I T h e n t h e y p r o p o s e d to i n v e s t a f u r t h e r 4 2 5 , 7 5 0 Deutsch marks 24 'Well, i n t h i s l e t t e r f o r m b u t I sai d; 21 in t h o s e r e d e e m a b l e p r e f e r e n c e s h a r e s , says, I t h i n k t h a t is is it n o t ? Yes. So t h a t t h e y p u t q u i t e a l a r g e s u m of y o u r m o n e y in those shares? 27 A. 28 26 0 Q. 29 ' H e re is a It w o u l d a p p e a r so, n o t o n a n i n s t r u c t i o n f r o m me. I t h i n k you said that f rom time to time t h e y c h a r g e d 1 2 26 1 Q 3 A Every year? Yes. As f a r as I w a s c o n c e r n e d , if I m a y m a k e a 4 statement, 5 a n d w h e n I just l o o k e d b a c k on the w h o l e thing, 6 w e r e a b l e t o p r e y on t h e f e a r s of I r i s h i n v e s t o r s b y 7 g e t t i n g t h e f u n d i n g i n t o G u e r n s e y i n o r d e r to a l l a y 8 a n y I r i s h i n v e s t o r t h a t t h e s e m o n i e s w o u l d be 9 d e c l a r e d f o r I r i s h i n c o m e tax, that Guinness & Mahon when I recollected they they had this trust 10 and c o n s e q u e n t l y th e y were able to b u i l d an en o r m o u s 11 trust, 12 w i t h t h e m o r h a d m o n i e s w i t h them, 13 w a s a s u r e - f i r e w a y of k e e p i n g t h e m o n i e s u n d e r o n e 14 ro o f. 15 262 Q 16 17 I do n o t k n o w h o w m a n y p e o p l e w e r e i n v e s t i n g b u t at l e a s t it T h a t is m y l i t t l e o b s e r v a t i o n o n it. D i d y o u f o r m a n y i m p r e s s i o n o f t h e e f f e c t i v e n e s s of t h e i r a d v i c e t o y o u in t e r m s o f i n v e s t m e n t s ? A T h e i r a d v i c e t o m e w a s ve r y , v e r y poor. I actually 18 at t h e t i m e j o i n e d C e n t u r y I n v e s t m e n t C l u b h e r e in 19 D u b l i n in a v e r y l e g i t i m a t e m a n n e r a n d c o u l d see 20 w hat c o u l d be done w ith m o n i e s 21 But unfortunately, I c o u l d n ' t b r i n g it b a c k . 22 over in Guernsey. It w a s b a d l y h o u s e d a n d b a d l y 23 m a n a g e d so I w a s g l a d in a w a y t h a t t h i s w h o l e t h i n g 24 came to a c o m plete 25 because 26 l e g i t i m a t e m a n n e r i f I h a d it b y h a v i n g it o v e r 27 there in the first place. 28 I t h i n k just one c o n c l u d i n g question, 29 if p r o p e r l y i n v e s t e d . It w a s s t o p a n d I c o u l d g e t r i d o f it I t h i n k I lost m o r e m o n e y in a ver y Mr. Dal y. 1 suggested that you closed your account with Guinness 2 & M a h o n at a r o u n d t h e t i m e t h a t y o u w e r e s o r t i n g o u t 3 matters with the Revenue Commissioners? 4 Correct. 5 264 Q 6 A 7 26 5 Q 8 So t h a t w a s a r o u n d 1 9 9 3 / 1 9 9 4 ? 1994 . So that you c l o s e d your a c c o u n t w i t h C o l l e g e Trustees then? 9 A 10 2 66 Q Totally. MS. MACKEY: C o u l d y o u j u s t t e l l us h o w 11 y o u d i d tha t, 12 13 Mr. Daly? Who did you contact about that? A I p i c k e d up the phone and I called Brian Ellis and I 14 sa id; 15 i n f o r m a t i o n y o u c a n g i v e me. 16 investigation', 17 267 Q 18 A 'I n e e d as m u c h a s s i s t a n c e a n d a l l t h e I am f a c i n g an and they sent me the papers. What about the funds? T h e y sent me the cheque. Sorry, they had 19 t r a n s f e r r e d t h e f u n d s at t h a t t i m e t o A I B J e r s e y a n d 20 consequently AIB Jersey supplied instruments, very 21 le g a l l y t e c h n i c a l l y stating the total amount. In 22 fact, 23 268 Q 24 25 y o u h a v e it t h e r e . Y o u b u t y o u s a y C o l l e g e T r u s t e e s t r a n s f e r r e d it to AIB Jersey? A E v e n at t h a t tim e, even b e f o r e m y e n c o u n t e r w it h the 26 in vestigation branch, 27 AIB Jersey. 28 269 Q 29 A College Trustees had? they already had monies with 1 So j u s t to g e t it c le ar , 2 w i t h college, 3 i n v e s t i g a t i o n s t a r t e d w h e n y o u r f u n d s m o v e d to A I B 4 or d i d C o l l e g e s u b s e q u e n t l y c l o s e d o w n y o u r e n t i r e 5 fund? 6 A 7 27 1 Q 8 9 was that c l o s e d b e f o r e the Wer e there still some funds left in College? None whatsoever. So w h e n d i d you f i n i s h y o u r c o n t a c t w i t h C o l l e g e itself? A W h e n I a s k e d t h e m to g i v e m e t h e t o t a l a m o u n t o f 10 funding, 11 you, 12 a c c o u n t a n t s did, 13 272 Q 14 A 15 w h i c h is r e f l e c t e d i n t h e d o c u m e n t 27 3 Q 17 A Deloitte Well, & Touche. C o l l e g e n e v e r r e t u r n e d t h e f u n d s t o me. No, no. The funds are w i t h AIB. T h e f u n d s at t h a t time , 19 wit h the Revenue, 20 because 21 as a r e s u l t , 22 AIB Jersey. say in Janu a r y w h e n the a mount of m o n i e s h a d to be l o d g e d t h e n h a l f the funds w e r e sent I w a s c h a r g e d 50% o f e v e r y t h i n g I o w n e d a n d t h e r e s i d u e w a s 50%, b u t i n m y n a m e in So it h a d n o c o n t a c t at t h a t s t a g e w i t h C o l l e g e Trustees ? 25 A 26 27 5 Q 27 None whatsoever. H o w d i d it g e t i n t o y o u r n a m e ? happen? 28 A 29 276 Q I am T hey still are? 1994, 24 my W h e n d i d Co l l e g e r e t u r n y our funds to you? 18 274 Q I gave a n d t h e y p l a c e d t h e s e in f r o n t of -- w e ll, t r y i n g to f i g u r e t h i s out. 16 23 whe n the account was closed I a m s u r e I a s k e d the m. W h e n did that 1 2 B u t t h i s is w h a t 3 e n d of t h e a c c o u n t 4 a n d w h e n t h a t m o n e y w e n t i n t o y o u r o w n n a m e in a 5 different bank entirely? 6 A 7 8 I am t r y i n g to a s c e r t a i n ; in C o l l e g e T r u s t e e s c a m e a b o u t A s t h e p o l i t i c i a n said, t h a t is a g o o d q u e s t i o n a n d I w o u l d l o v e to f i n d t h e a n s w e r . 278 Q 9 D i d y o u i n s t r u c t C o l l e g e T r u s t e e s at a n y p a r t i c u l a r p o i n t to close d own the trust? 10 A 11 279 Q 12 I did, yes, indeed. T h a t is w h a t I a m t r y i n g to f i n d out. W h e n did that happen? 13 A 14 28 0 Q 15 A 16 28 1 Q 17 A 18 282 Q 19 A I a m s u r e it h a p p e n e d in J a n u a r y 1994. J a n u a r y 1 994. Yes, Y o u i n s t r u c t e d Mr. Ellis? indeed. To c l o s e y o u r a c c o u n t ? Correct. A n d to do w h a t w i t h the funds? F i r s t of a l l to s e n d m e a c h e q u e . In fact, 20 R e v e n u e h a v e a c o p y of this. 21 t h e y w e r e s t i l l in J e r s e y b u t i n m y n am e . 22 28 3 Q 23 24 w h e n the the But half the monies, B u t d i d y o u i n s t r u c t t h e m at t h a t p o i n t t o p u t t h e m in your name? A I a m s u r e I did, I a m s u r e I did. I said I wanted 25 n o m o r e to d o o r n o t h i n g f u r t h e r t o d o w i t h C o l l e g e 26 Trustees. 27 J e r s e y w a s t h e f a c t t h a t -- h e r e w a s a v e r y 28 t r a u m a t i c time for me personally. 29 T h e r e a s o n w h y t h e y w e r e l e f t i n A I B in 1 A. Consequently, as l o n g as R e v e n u e g o t t h e i r h a n d s o n 2 the cheques, 3 accountants in A I B sa id; 4 o v e r there, y o u a r e g o i n g to b e c h a r g e d 4 8% D I R T b u t 5 i f y o u b r i n g y o u r m o n e y b a c k h e r e t o us i n t h e 6 Carpet Mill Centre, 7 c h a r g e d D I R T at t h e n o r m a l r a t e . ' 8 28 5 Q. 9 they were happy. T h e n o n e of t h e 'If y o u l e a v e y o u r m o n e y t h e n yo u are o n l y g o i n g to be C a n I j u s t s u m m a r i s e t h i s a n d y o u t e l l m e if I a m incorrect in w h a t I u n d e r s t a n d now, t h a t at a p o i n t 10 i n J a n u a r y 199 4 y o u i n s t r u c t e d C o l l e g e T r u s t e e s , 11 Mr. 12 dow n the trust? 13 A. 14 2 8 6 Q. 15 Ellis, t o c l o s e y o u r a c c o u n t w i t h them , to c l o s e Yes. A n d t o s e n d y o u a c h e q u e o f 50% of t ha t , which you w i s h e d to p a y to t h e R e v e n u e C o m m i s s i o n e r s ? 16 A. 17 287 Q. Yes, correct. A n d t h a t w i t h t h e o t h e r 50%, t h e y w e r e t o p u t it 18 i n t o a n a c c o u n t i n y o u r n a m e in A I B i n J e r s e y , 19 t h a t it? 20 A. I a m e n d e a v o u r i n g to t r y a n d f i g u r e o u t how. is I am 21 q u i t e c e r t a i n t h a t p r i o r to t h i s c h a o t i c s i t u a t i o n 22 occurring, 23 Jersey but still under...(INTERJECTION) 24 288 Q. 25 A. 26 2 8 9 Q. 27 28 29 I k n e w a l l m y m o n i e s w e r e w i t h A I B in In the n a m e of C o l l e g e ? U nder the name of College. Yes, I u n d e r s t a n d t h at . N o w it is w h e n t h a t stopped. A. W h e t h e r I d i d it b y p h o n e , whether I instructed AIB J e r s e y t h a t t h i s is n o t C o l l e g e m o n e y , it is m y 1 m o n e y an d I h a v e p a i d m y dues to the S t a t e an d I 2 h a v e g i v e n t h e m 50% a n d t h e r e s t of it is i n m y 3 name. 4 a m s a y i n g b u t it is a v e r y g o o d t h i n g a n d I w o u l d 5 l i k e t o e v e n e x a m i n e m y s e l f as t o p r e c i s e l y . 6 2 90 Q. N o w I m a y not be e x a c t l y p r e c i s e in what Do yo u t h i n k yo u m a y h a v e a n y d o c u m e n t s in r e l a t i o n 7 to t h a t ? 8 w r i t t e n e i t h e r to A I B J e r s e y o r t o G u i n n e s s a n d 9 M a h o n or t o C o l l e g e at t h a t t i m e t h a t m a y c l a r i f y 10 this 11 A. 12 29 1 Q. 13 W ould you have any letter you m a y have f o r you, or that t h e y m a y h a v e c o p i e s ? I w i l l c e r t a i n l y e n d e a v o u r to d o th a t . W i l l y o u l o o k i n t o t h a t so t h a t w e m i g h t c l a r i f y what instructions you gave? 14 A. 15 292 Q. Yes. T h a n k you, Mr. D aly. W o u l d it h a v e b e e n t h e case, 16 do y o u t h i n k , 17 instructions by telephone? 18 i d e n t i f i e d it w a s y o u a n d so o n ? 19 A. 20 29 3 Q. 21 22 that they w ould have accepted You m a y certainly, yes, a n d if y o u c a n l o c a t e a n y documents. A. Because I will tell you one thing, w a s at t h a t 24 everything. 25 enjoyed the money, 26 of m o n e y n e v e r to have.. 27 p o i n t o n that . 29 How would they have M a y I go h o m e a n d p o n d e r a n d t h i n k t h i s o u t ? 23 28 I 294 Q. s tag e, w hatever age I I w a n t e d to w a s h m y h a n d s of I have been cleansed. And I never n e v e r e v e n -- f o r s u c h a n a m o u n t Not that I am m a king a P e r h a p s if y o u c a n c l a r i f y it i n y o u r o w n m i nd , 1 in w h a t y o u r e c o l l e c t a b o u t t h e m a t t e r w h e n y o u h a v e 2 r e c o l l e c t e d it a n d if y o u c a n l o c a t e a n y d o c u m e n t s , 3 w h e t h e r yo u m a y h a v e c o p i e s y o u r s e l f or w h e t h e r you 4 think College Trustees 5 of s o m e t h i n g ? 6 A. could furnish you with a copy I am sure College Trustees, t h e r e is s o m e t h i n g 7 c o m i n g b a c k in m y m i n d , 8 l e g a l i s t i c f o r m of w o r d s that the e n t i r e a m o u n t of 9 m o n e y w h i c h t h e y h e l d o n m y b e h a l f w a s X, w o u l d have st a t e d in a v er y Y or Z 10 a m o u n t a n d t h a t t h e 50% o f t h a t w a s w h a t e v e r t h a t 11 w a s a n d t h a t t h e b a l a n c e -- it is a n i n t e r e s t i n g 12 ar e a. 13 29 5 Q. 14 A. 15 2 9 6 Q. I a m s o r r y I c a n n o t h e l p you. If y o u c a n c l a r i f y it f o r us, E s p e c i a l l y if y o u c a n g e t a n y d o c u m e n t s t h a t w o u l d c l a r i f y it, 17 much. A. Surely, MR. 19 Daly? Yes. 16 18 Mr. that w o u l d be great. Thank you very yes. ROWAN: Mr. Daly, much. 20 thank you very I t hink that 21 concludes 22 b e t r a n s c r i b e d a n d Ms. 23 you about c om i n g into sign the t r a n s c r i p t in due 24 course. 25 A. Yes. our i n t erview today. Cu m m i n s will be in t o u ch with M a y I i n f o r m you of m y m o v e m e n t s 26 months ? 27 MS. MACKEY: 28 29 The i n t e r v i e w will Y o u c a n i n f o r m Ms. at t h e end, fine, because in the c oming Cummins that will be sh e w i l l b e d e a l i n g w i t h y o u so y o u 1 2 c a n s o r t a l l t h a t o u t w i t h her. A. T h a nk you v e r y much. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 THE INTERVIEW THEN CONCLUDED mm 000d 3131.?. .J . Load/v ow. FILEC LODGEMENTS AND WTTHDRAWLS . Without the support o f all b a n k statements I find it impossible to recall exact som a and exactdates. I p h m e d Brian Ellis o f College Trustees LtcL, o n April 2 8 * asking hinifbr the documentation o n m y file T C 4 3 1 whi ch w a s closed 7 years ago H e seat m e a fix to day w h i ch I enclose. A a I have all the documentation be released to m e in 1993 for m y tax settlement I enclose those b a n k statements showing all flmda o n a rollover basis. A O I c a n do is mgr reasonable best to anawertbequestiona yo u pose o n p a g e s 16 and 17 w ^ the data I have in File C . (a) Martin K e a n e o f Guinness M a h o n Dublin transferred a s u m in the region of £120;000 to Guinness M a h o n Guersney which I brought to U s bade in a suitcase in cash f r o m Allied Irish Finance (North o f Ireland) circa D e c e m b e r 1977 (b) Seemingl ythismone y w a s taken over b y College Trusteesaa o f January2 4 * 1978 t y J o h n IJpar ambe then at Guinness M a h o n Guernsey and director o f the Trust (c) There w e r e 1 very large lodgements, the one stated above as £120,000 and a second on e o f £128,234j96. This second s u m w a s brought in cash in a suitcase to the N e w r y Branch oftbe B a n k of Ireland o n February 4* 1983 and transferred to the B a n k o f Ireland in the Isle of M a n and later to Guinness M a h o n Guernsey. I enclose the B O I statement. (d) M y statement refers to the & c t that I withdrew £10,000 cash f r o m G u inness M a h o n Dublin o n tbe 2 nd o f August 1990 A M r M urray or Mr. Farrelly of Guinness M a b o n Dublin facilitated m e in this regard. ^ _ • T h e Iirvestmeil Department o f Guinness M a h o n Dublin bought 1000 shares inGreencore and 5000 shares in Irish Life o n m y behalf I enclose those 2 documents. S U M M A R Y ofEnclosures o n File C In N o v e m b e r / D e c e m b e r o f 1 9 9 3 1 received from Mr. S J B . W o o d w a r d of College Trustees a statement fiomGuinness M a h o n Guernsey which shows the transfers o f all funds from t h e m to AJ.B. B a n k (CJ.) Jersey Should I receive fiirther documentation f r o m archive storage in Guernsey as promised in the enclosed fax I shall bring t h e m to your attention immediately. On 1 9 / K .f o l l o w i n g p r o p e r t y . t h e -jirua t a e a a c c e p t e d t h e a n d 'resolved to t r e a t t h e same as a n a d d i t i o n t o .t he s e t t l e d f u n d s o f -the Trusts— • . l\0AS*vtd*-cd. &***£ esd- h j - p v u * » j ? 5 £ ^ For . •S'S^y College Trustees Limited • * i / $ * • V • • « #• •M E M O R A N D U M OP AEPITION ' * * *Qn • 19 •t t h e T r u s t e e s a c c e p t e d t h e following property and resolved to an settled funds o f the* to 'Trust:- . the ’ . treat the . - • same as ’ ••' • • For College Trustees plaited r ' * On • * * MEMORANDUM ’ • * * • . ' OF ADDITION . ‘ +*y # * ‘1 9 ’ 9 the'- T r u s t e e s a c c e n t e d t h e . f o l l o w i n g property' a n d resolved, t o .treat t h e earne r s an. - . a d d i t i o n t o \ .Trust*-;. - t h e . s e t t l e d f u n d s o f <*the • • •/: '••• * •* *• 1 • •* •For C o l l e g e T r u s t e e s L i m i t e d . 1 M ? Careen M a c k e y B J L , Office o f the Inspectors, Trident Hou s e , ’ Blackcock. Co. Dublin • t M i, , M a y 2 * 2000 .s' ,.$a$e that I shall endeavour to provide every assistance with yo ur investigation. •( kL«> ’ A s a n introduction to the data y o u seek I w i s h to state that as a result o f a letter f r o m Mr . E L G . Oliver, a n Inspector with the Investigation Br a n c h o f the Office o f C h ief Inspector offT a xes I availed o f Section 3 o f the T a x A m n e s t y S c h e m e o f 1993 b y remitting all arrears o f taxes in full, d u e f r o m the tax year 1958/1959 to 1990/1991. Thfe Incentive A m n e s t y Section 2 did not apply to m e as a result o f having b e e n written to b y the Investigation B r o o c h as o f September 18th 1992 . l a m a bachelor a g e d 7 3 a n d aretired teacher. I w a s always financially independent as a result o f m y teacher’ s salary irrespective o f the m o n e y s held in trust for m e b y College Trustees L t d located in Guernsey. A s the deposits w e r e o » a roll over basis I never enjoyed i n c o m e f r o m t h e m except w h e r e stated o n File C ( m a r k e d Guinness'Mahon/ College Trustees T C 4 3 1 ) w h i c h is enclosed w i t h this statement • * In ordar to acquaint y o u as to h o w I c a m e into fimds with Guinness M a h o n I sketch a short r e s u m e o f m y career.' I qualified as a teacher in 1947. F r o m 1 9 5 0 through 1958 as a y o u n g teacher I participated in t o m s o f E u r o p e during m y S u m m e r holidays attending student w o r k c a m p s with grovqps o f International students in S witzerland, G e r m a n y , France, Italy a n d the U K w h i c h enabled m e later to n e t work worldwide. In 1 9 5 7 1 obtained a S u m m e r job with a n A m e r i c a n Airline, Flying Tigers at H e a t h r o w Airport a n d gained valuable experience in operating transatlantic charters to the.United States. M y task w a s to organise hundreds o f Hungarian Refugees in charter flights f r o m E u r o p e to the U S A . In 1 9 5 8 / 5 9 1 started operating charters f r o m Ireland to the U J > A a n d successfully continued to d o so as a on e naan operation until 1974. B y this 1 9 7 5 1 h a d chartered over 60 transatlantic airlmen w i r ichwas the source o f the m o n e y s with Guinness M a h o n / C o l l e g e Trustees L t c L e a m e d b y e n o r m o u s hard w o r k and v o y long hours. T h e m o n e y s f r o m m y transatlantic operation! profits to the United States w e r e placed o n deposit with Guinness M a h o n o n a roll over basis a n d w e r e only nsed b y m e as stated o n the d o c u m e n t in File C m a r k e d " witbdrawls" o n specified dates as per m y diary. In 1977/78 a n official o f GuinwSss M a h o n bank, M r M a r t h i K e a n e told m e o f a n impending split b e t w e e n J/uh p o u n d s a n d Sterling. H e transferred the dq wsit to Guinness M ^ h o n Gue^: . ■ . Since I w a s r ^ j r ' i n G u e r n a e y I later w e n t there oat o f cariosity a n d visited the offices o f G u i n n w s - ^ u h 6 n . I w a s told to contact a Me . John Lipscombe. H e told m e that m y fap&^sixc acquired b y College Trustees L t d o f w h i c h h e w a s the director. I w a s ^urprised a n n o y e d to learn this fact as I ha d given n o authorisation & r m y funds to b e ^ p l a c e d a n y w h e r e o r given to anyone except the b a n k o f Guinness M a h o n in Guernsey. < . • . I w a 3 t o k l that this w a s in m y o w n interest as the m o n e y w a s n o w n o longer in m y name. I w a s asked to fiU out a letter o f wishes It w a s dated October 2 6 * 1981. My number was TC431 . A s l n e v e r got a n y correspondence f r o m College Trustees Ltdjf flew to Guernsey in 1984 a n d d e m a n d e d a statement I learned that m y firnds h a d b e e n placed with N J M . Rothchild ft S o n s ( C l . ) a n d w e r e under professional m a n a g e m e n t • I fefcuncoinfbrtable with this arrangement as I h a d n o control over m y funds and so d e m a n d e d that J o h n L i p s c o m b e put the a m o u n t placed with Rothchild o n record a n d in writing w h i c h h e did a n d signed it o n M a r c h 2 1 * 1984. ■I later learned that w h e n M r l i p s c o m b e retired that he w a s replaced b y a M r Brian Ellii H e used to p h o n e m e o n c e a year to tell m e the yearly fees o f College a n d the a m o u n t o f m y deposit w h i c h w e r e o n a roll over basis.. ‘ . O n learning o f the feet that I w a s under the scrutiny o f the Investigation Branch as o f September 18th 1 9 9 2 1 contacted a tax specialist in Deloitte Touche. I w a s told to procure all d o c u m e n t s f r o m College Trustees Ltd. in so far as it w a s h u m anly possible. M r Pat K e n n y o f Deloitte T o u c h e negotiated a tax settlement with the office o f the Chief Inspector o f Taxes. His office repaired all m y tax returns. File B contains this data. O n receipt o f y o u r letter o n Friday April 14th. I immediately contacted Guinness M a h o n Dublin an d College Trustees Ltd., Guernsey seeking additional documentation. A t H » time o f writing this tetter to y o u I have not obtained sqy {farther documentation f r o m either source. I severed all dealings with t h e m 7 years ago w h e n I closed all accounts a n d secured the d o c u m e n t s fcr a y tax settlement w h i c h I n o w fiamsh to y o u in FileC. . I i r o n e d y our Office this m o r n i n g to obtain & direction as to whether or not I should send the documentation containing stated amounts o f moneys. I w a s informed I should send all documentation to y o u with this state m e nt —^ * Files m a r k e d A a n d B contain letters concenrirg the Settlement o f m y T a x Affairs with theInvssdgationBranch oftheChfcfb^ctarafTixea. ' File- C contains d o c u m e n t s reIatira> n k/e ic m •** Copy gtiCwint ••• 0/* 1,3»0,0CC.«C C40.0C«.■< A o .o m .h » i 1 w n » b ro u g h t f o ra s rd 2c jlt to 02 ado io 17 Atn »0 wtea o o u n trusties iff a m vramuuar BXCU O D U r a TW M TB M Iff <50,000.00 to,000.00 (4I.CU.M Lamp/n - Mammalian?! 10mm mm" uamu mu Inn/cm?: agar Itauc-nn: ?to *5 ;.121.4tn.:o 0.00 '1.131.?sa.s? .* VpN.TRACT DATE •; RiVERENCE NO . 15 July 1991, 19910716341 ACCOUNT NO 09404000 SETTLirMENT DATE 15 JULY 1991 STEPHEN DALY ESQ., CAPITAL WE CONFIRM WE HAVE PURCHASED FOR YOU : ACCOUNT DESCRIPTION PRICE ' •.• CONSIDERATION 5000.00 IRISH LIFE 1.600 8000.00 . COMMISSION 1 25.00 **».••.. • •• foTALlRP 8025.00 STEPHEN DALY ESQ. 29 RATHCAR ROAD EAST RATHCAR DUBLIN 6 For and an bahaif of QUINNESS & M A H O N LTD. Gulnntft &Uihon Lilt hcarportitd in Intend . * Rsgttemd Oflto*: 17 CoBsga Oman, DuMn 2. RagiitMd nufnbar:,10282, Teiaphom: 6796944 Talsx 83067 (QentnO 30437 {Pomx) ' * ’ & College Trustees Limited BRB/CDS/TC 431 .. ' STRICTLY PRIVATE * CONFIDENTIAL S. Daly Esq., 29 Terenure Road East, Dublin. 6 . Ireland. /->v - . ' . 21st March 1984 Dear Mr. Daly, We, College Trustees Limited, a member of the Guinness Peat Group Pla hereby declare that we are holding at this date In the registered name "College Trustees Limited Account TC 431” Participating Redeemable Preference Shares of U.S. 1 cent each in Old Court International Reserves Limited as follows: Fund Class ____ :____ No. of shares __________ __ Deutschemarks Trench Francs Japanese Yen 7,715.372 6,869.862 -11,428.947 Value in Deutschemarks ’ as at 27th February -1984 401,546.54 385,310.48 834,960.60 . . Total value as at 27th February 1A84DnlySa1f817;G2 , f t i ' j i y /y s a -y - v ? JW* He further declare that: the amount of approximately Dm.425,.750Dm.4 which is about to be transferred to N.M. Rothschild a Sons (C.l.) Limited for our account will bq utilised in its entirety to purchase further Participating Redeemable preference' Shares -in Old Court International Reserves Limited and that such further shares will also be registered in the name of College* Trustees Limited Account TC 431. We hereby confirm that all and any assets’now registered or which at any time in the future may be registered in the name of College Trustees Limited Account TC 431 will be held in respect of the trust known to you and that we as trustees of that trust are in possession of a letter from you dated 26th October 1981 which provides us with guidance as to the disposition of the capital ; and income of the said trust. \ i' ./ \ / J.G. Lipscombe Director . C o lle g e T r u s t e e s L im it e d Our Ref: BRE/KEH/CSMATS 5* May, 2 0 0 0 STRICTLY PRIVATE A CONFIDENTIAL TO BE OPENED BY ADDRESSEE ONLY S Daly Esq FTP Travel Limited 2 9 Terenure Road East Dublin 6 IRELAND Dear M r Daly I refer to your tetter of 18* Apri, 2000, in which you request information and documents in respect of what you refer to as "deposits of moneys that you had with this Company*. Firstly, i should explain that this Company has never been a deposit accepting institution. The Company's principal activity was that of acting as a Trustee and any funds added to a Tiust were crecflted to an account with a properly Icensed bank. Those accounts were all dearly identified. I hawe pleasure in enclosing copies of the accounts of The Elinor Trust for the period ended 31" December, 1961, and for the year ended St* December, 1992. The Trust Fund was dbtributed in early 1904 and so no accounts were prepared after those of 1992. -** ■ In response to paragraph 3 of your tetter, I can Inform you that the first transfer of funds Into the Trust took place on 24* Januaiy, 1978. I hope that the accounts and the Information In this tetter are sufficient for your purposes and those of the Inspectors but, if you do need any more Information please do not hesitate to contact me. Kind regards. Yours sincerely for C O L L E G E T R U S T E E S LIMITED 8 R Ellis Enc P. O. Box 223, Les Echelons, St PeterPort, Guernsey, Channel Islands, OY13NT, Telephone: 01481 726641 Tetex: 4191532 O Rue: 01481 726218 K e n n e d y M c G o n a g l e B a l l a g h I ncorporatin g B e l l B r a nig an O ’ Do n n e l l & O ’ B rien S () L I ( I 1 <) K S 20 N O R T I I U V I H L R L A N D R O A D D U B L I N 4 I L L 660 ‘ )7 W I-A X 660 9434 i \I ML: inlo!. B \l I.Mill II KIM IK. DIXON klA’ IN C. ISARRY CORDON .11 IXii; ASSISI AN is: IIONA III.NRY Al ,AIIIA U. IAVI .OK coNsn.TANis: iAi iii-.M i: r. uk nnioan m a k i i n a i .o 'h o r m \n COMMISSIONERS IOR OAl lIS / MVIAKII'.S in Bi ll' Member of the Association of Independent Lumpean Lawyers. In 1984 he found out that his funds had been placed with NM Rothschild & Sons (C.I.) and were under professional management. The client then demanded that the amount in Rothschild be placed on record and in writing. Thereafter the only correspondence the client had with College Trustees Ltd was an annual telephone call to discuss the Trustees fees and the amount o f the deposit to be rolled over. A couple o f withdrawals from the account were made, the first was to facilitate the purchase o f shares, the second was a withdrawal o f £10,000 in notes. Both transactions were arranged by Guinness Mahon (Dublin). As proof o f the fact that SD was a client Ansbacher, the inspector produced a statement which showed that Deutschmarks held under the identification number of SD had been deposited in an account held in Dublin in the name o f Guiness Mahon Cayman Trust, a former name o f Ansbacher. The inspector accepted however, that this may have been done without the clients knowledge (See page 31 o f the interview transcript). SD was under investigation by the Tax Office in 1992 and availed o f the Tax Amnesty. Once a settlement had been negotiated in 1994 SD closed all accounts he held with the Trustees and has not had any further, dealings with them. Given the circumstances, it appears inappropriate to classify SD as a client o f Ansbacher with all the connotations such a finding would have on both his personal and professional lives. The document "Definition o f a Client" produced by you is not any justification to call SD a client o f Ansbacher. Your report can contain fact and opinions but not misstatement o f fact. While SD approached Guinness Mahon with a view to setting up a deposit account and was advised to place the funds in Guernsey and did so. While a trust was set up to deal with these funds, this was done without SD's knowledge and the only regular correspondence he had with College Trustees was an annual telephone conversation to discuss their fees. It now appears (through your investigations, while some o f SD's funds were placed in the Ansbacher account, these funds were effectively not under his control and the Inspectors have already accepted that this transfer may have been done without his knowledge. In the circumstances it is not reasonable to consider SD a client o f Ansbacher. We urge you to reconsider your preliminary conclusion o f the 18th July. It is neither factually correct nor fair to SD. What does the ordinary English usage of the term "client" mean? In the context o f a relationship between a party and a professional person where that person is using the services o f the professional person the term "client" is clearly understood. It can also mean " customer". Given the facts the statement that SD was a client o f Ansbacher does violence to the concept "client". Undoubtedly SD had money which he put into the hands o f third parties to manage. In fact in the course o f management certain o f the funds may or may not have been placed in an Ansbacher account by a third party does not justify the description "a client o f Ansbacher". As the concept o f being an "Ansbacher account-holder" or a client o f "Ansbacher", in the speak o f the investigation is an allegation which is seriously damaging to those against whom it is levied. The current preliminary conclusion is unjustified and damaging to SD. Might we suggest that if it is necessary to refer to SD at all in your report ( and why he should be named in any public way at all is unclear, he can be identified as a "party" who employed the services o f Guinness Mahon. That part o f his monies lodged to Guinness Mahon were, for a limited period, deposited, unknown to him, in an Ansbacher account. Yours faithfully, Kennedy McGoriagle Ballagh A p p e n d i x X V (149) M r William F o r w o o d & M r s Joyce F o r w o o d 1. Evidence relied upon by the Inspectors in arriving at the conclusion relating to Mr William Forwood & Mrs Joyce Forwood. a) Transcript of evidence o f Mr William Forwood dated 17 July 2001. b) Letter o f 24 October 2000 - Mr William Forwood to Inspectors. c) Extract from GMCT re College sundry sub-account at Guinness and Mahon of 20 January 1987. d) Letter o f 17 May 1991 from Ansbacher Limited to IIB. e) Extract from Report of the Central Bank o f Ireland on Guinness and Mahon as at 31 December 1985. f) Internal Guinness and Mahon memo re York Securities Limited. UNDER OATH ON TUESDAY, 17TH JULY 2001 I h e r e b y c e r t i f y the f o l l o w i n g to b e a t r u e a n d a c c u r a t e t r a n s c r i p t of m y s h o r t h a n d notes in the above named interview. Stenographer The Inspectors: MR. P. R O W A N M S . M A C K E Y BL Sol i c i t o r to the Inspectors: MS. M. Interviewee: MR. CUMMINS FORWOOD WITNESS EXAMINATION PAGE MR. M R . ROWAN 5 - 3 8 FORWOOD M S . MACKEY 39 - 71 M R . ROWAN 72 - 76 1 2 3 4 5 MR. ROWAN: Formally, 6 Mr. Forwood, g oo d m o r n i n g to you and 7 t h a n k you for c o m i ng today. 8 myself: 9 Inspectors. I am Paul Rowan. May I introduce I a m o n e of t h e O n m y r i g h t is Ms. N o r e e n Mackey. 10 MR. Forwood: Yes. 11 MR. ROWAN: A n d Ms. 12 Ma r y Cummins, our solicitor. 13 MR. Forwood: Yes. 14 MR. ROWAN: I just want to say that 15 t h i s is n o t a C o u r t a n d 16 it is n o t a T r i b u n a l . 17 MR. Forwood: Yes. 18 MR. ROWAN: However, 19 It is a n i n t e r v i e w . we do have some f o r m a l i t i e s in that we 20 t a k e it u n d e r o a t h a n d w e a l s o k e e p a r e c o r d o f 21 the interview. 22 Ms. 23 t h e oath. 24 25 26 27 28 29 Cummins, So, without further ado perhaps, y o u w o u l d i n v i t e Mr. F o r w o o d to take 1 2 3 4 5 1 Q. MR. ROWAN: We are g oing to divide the interview into two main 6 7 parts. 8 h a v e s o m e of t h e b a c k g r o u n d w h i c h y o u h a v e a b o u t 9 y o u r t i m e in G u i n n e s s T h e f i r s t p a r t is t h a t we w o u l d l i k e to & Mahon and whatever 10 involvement you had with Guinness Mahon Cayman 11 Trust? 12 A. 13 2 Q. 14 Yes. W h i c h o f c o u r s e is n o w k n o w n as "Ansbacher" Cayman Limited? 15 A. 16 3 Q. 17 Yes. T h e n t h e s e c o n d p a r t of t h e i n t e r v i e w w i l l b e to take up some s p e ci f i c m a t t e r s w i t h you? 18 A. 19 4 Q. Yes. A n d Ms. M a c k e y w i l l u n d e r t a k e t h a t p a r t o f t h e interview? 20 21 A. 22 5 Q. Yes. Y o u v e r y k i n d l y p r o v i d e d us o v e r t h e m o n t h s w i t h 23 some i n f o rmation and I am p a r t i c u l a r l y thinking, 24 Mr. 25 and the copy of the statement w h i c h you p r o v i d e d 26 to us w h i c h y o u h a d a l r e a d y s e n t p r e v i o u s l y to t h e 27 Authorised Officer; 28 A. 29 6 Q. Forwood, of y our l etter of the 2 4th O c t o b e r Mr. Ryan ( E x h i b i t 1)? Yes. Y o u t o l d u s t h a t y o u q u a l i f i e d as a s o l i c i t o r in 1 2 3 7 Q. 4 A. 5 8 Q. In 1954? Yes. A n d t h e r e a f t e r be c a m e a p a r t n e r in a L o n d o n law firm? 6 7 A. 8 9 Q. 9 A. Yes, 10 10 Q. Yes? 11 A. 12 Yes. D i d y o u h a v e a s p e c i a l i s a t i o n as a s o l i c i t o r ? essentially commercial. B u t m o s t p a r t i c u l a r l y in t h e f i e l d of o c c u p a t i o n a l pe n s i o n schemes. 13 11 Q. 14 A. 15 12 Q. 16 A. 17 13 Q. 18 I see? I s h o u l d b e so b o r i n g . Okay? B u t t h a t is - ­ Then you said that you were asked b y Mr. 19 A. 20 14 Q. 21 A. J o h n G u i n n e s s to j o i n G u i n n e s s & Mahon? Yes. How did you know John Guinness? It is w a s a c t u a l l y t h r o u g h m y w o r k as a s o l i c i t o r . 22 I a c t e d f o r a s m a l l c o m p a n y in w h i c h I w a s 23 particularly interested called Transworld 24 H e l i c o p t e r s L i m i t e d an d one of the D i r e c t o r s of 25 T r a n s w o r l d H e l i c o p t e r s w e n t to I r e l a n d w i t h a v i e w 26 to se t t i n g up a f a c i li t y for t r a i n i n g p i l o t s a nd the 27 l i k e at S h a n n o n A i r p o r t . 28 t h i s he b e c a m e a c q u a i n t e d w i t h J o h n G u i n n e s s a n d 29 t h e B a n k p r o v i d e d f u n d s I t h i n k a n d as a r e s u l t D u r i n g t h e c o u r s e of 1 I m e t J o h n G u i n n e s s an d I t h i n k he was 2 i m p r e s s e d b y w h a t h e saw. 3 s u f f e r i n g d e s p e r a t e l y f rom o v e r w o r k a nd w h e n he m a d e 4 this e n t i r e l y u n e x p e c t e d s u g g e s t i o n to me I rather 5 j u m p e d at it. 6 15 Q. 7 A. Okay. That I s h o u l d j o i n the B a n k a n d t h a t a f t e r six months, 9 I w o r k e d as a n a s s i s t a n t we l l , 10 thing, 11 six months 12 L o n d o n Bank. 16 Q. 14 A. 15 17 Q. I at t h e t i m e w a s W h a t d i d he s u g g e s t to you? 8 13 favourably I went over for two mo n t h s cashier, I think and t h a t k i n d of an d t h e n I w e n t b a c k to L o n d o n a n d I spent i n G u i n n e s s M a h o n & Co, w h i c h was the Did y o u . . . (INTERJECTION)? A n d a l s o t h e p a r e n t Bank . Yes. W h e n Mr. G u i n n e s s p ut the p r o p o s i t i o n to you 16 di d you know that you were g oing to join the Bank 17 a n d a f t e r a p e r i o d of a c l i m a t i s a t i o n ? 18 A. 19 18 Q. 20 A. 21 19 Q. 22 A. 23 20 Q. 24 Yes. Y o u w e r e g o i n g to take a s e n i o r m a n a g e m e n t p o s i t i o n ? Yes. You did? Yes. Right. He felt that you w o u l d b r i n g y o u r c o m m e r c i a l l a w e x p e r i e n c e to the B a nk? 25 A. 26 21 Q. 27 A. Yes. Is t h a t w h a t h e w a s l o o k i n g f o r ? I t h i n k m o r e t h a n t h at. 28 and ver y small affair. 29 in w h a t was It w a s a v e r y o l d f a s h i o n e d The Directors sat t o g e t h e r k n o w n as t h e P a r t n e r s Ro o m . 1 22 Q. 2 A. 3 23 Q. We w i l l come to that? Yes. However, esse n t i a l l y you were bri n g i n g your 4 commercial 5 to I r e l a n d to the Bank? 6 A. 7 24 Q. Yes. Okay. You spent a period with Guinness Mahon & C o m p a n y in L o n d o n ? 8 9 A. 10 25 Q. 11 12 law experience and your wider experience Yes. W h a t d i d y o u d o d u r i n g t h a t p e r i o d of s i x m o n t h s or so? A. Again, it w a s l e a r n i n g , 13 learning, 14 in t h e B a n k. 15 brokers probably. 16 w e r e c a l l e d now. 17 26 Q. 18 A. 20 27 Q. 21 A. 22 I was also t a k e n on v i sits to m o n e y I can't even remember what they D i d yo u get i n v o l v e d in a n y c o m m e r c i a l t r a n s a c t i o n s I d o n ' t t h i n k so. All right? I n f a c t it is q u i t e l i k e l y t h a t I s a t i n on, know, 23 28 Q. 24 A. 25 29 Q. 26 A. 27 30 Q. 29 I w e n t to the v a r i o u s d e p a r t m e n t s in that six m o n t h s ? 19 28 phase. or i n t e n d e d to be a you w o r k w h i c h s o m e b o d y else was doing. Quite likely? Yes. So t h a t i n 1 9 6 8 y o u m o v e d to I r e l a n d ? Yes. A n d y o u w e r e a p p o i n t e d as C o - M a n a g i n g D i r e c t o r w i t h 1 31 Q 2 A In n o v e r y f o r m a l fashion. W e a l l sa t i n t h e s a m e 3 r o om. W e d i s c u s s e d a p p r o a c h e s m a d e t o us t o b o r r o w 4 funds; that 5 banker. So, 6 advice; that 7 32 Q 8 A 9 10 k i n d of thing. Obviously, I was no I t e n d e d to c o n c e n t r a t e o n c o r p o r a t e k i n d of thing. Legal agreements? N o t so m u c h . Takeovers and mergers; t h a t k i n d of thing. 33 Q Right. W h e n d id the q u e s t i o n of c r e a t i n g some 11 e n t i t y in the C a y m a n I s l a n d s 12 talked about? first start to be 13 A I c an't be e xact but 1972 w o u l d be m y b e s t guess. 14 34 Q I m i g h t be a b l e to give yo u a l i t t l e b it of h e l p ? 15 A Yes . 16 35 Q Page 17 95, M a r y (Same H a n d e d ) . of the c o n c l a v e 18 A 19 36 Q 20 A 21 37 Q I t h i n k t h e y a r e r e f e r r e d to a s ? Yes . A n d you will be familiar wit h those b e c a u s e you can se e u n d e r M i n u t e 23 b e s i d e it? A 25 38 Q 26 150 at t h e t o p y o u r i n i t i a l s a r e Yes . If y o u go d o w n t o M i n u t e 16 6 e n t i t l e d " C a y m a n Islands"? 27 A 28 39 Q 29 ( E x h i b i t 2)? Yes . 22 24 These are the Minu t e s Yes . Y o u w i l l se e w h a t it s a y s t h e r e : "M & G h a v e set up a u n i t t r u s t i n t h e Cayman Islands"? 1 A. 40 Q. 2 Yes. "A greed that we s hould i n v e s t i g a t e the p o s s i b i l i t y of f o r m i n g a c o m p a n y or a t r u s t t h e r e or in some o t h e r h a v e n " ? 3 4 5 A. 6 41 Q. 7 A. 8 Yes. Does that ring a bell? I c a n v e r y w e l l i m a g i n e t h a t t h a t is h o w it happened. 9 42 Q. 10 A. 11 43 Q. 12 A. 13 44 Q. Y o u c a n se e t h e d a t e on t h e t o p o f t h e s e M i n u t e s ? 1969. 17th J a nuary 1969? Yes. W h a t a c t u a l l y w a s d o n e a b o u t that , 14 I m e a n it s e e m s t h a t Mr. 15 beside that? 16 A. 17 45 Q. 18 A. Mr. Guinness's Forwood? in i t i al s are Yes. W a s he i n v o l v e d i n p u s h i n g t h a t i d e a f o r w a r d ? Yes, I t h i n k h e p r o b a b l y was. I can give you a 19 l i t t l e b i t of b a c k g r o u n d to t h a t if y o u a r e 20 interested? 21 46 Q. 22 23 A. 24 47 Q. 25 A. 26 48 Q. 27 A. 28 49 Q. 29 Yes. I was g o i n g to s h o w yo u p a g e 96, w h i c h is p r o b a b l y of a l i t t l e b i t m o r e h e l p ( E x h i b i t 3 )? Yes. A n d t h e t h i r d M i n u t e down , Number 166/2? Yes. Entitled "Cayman Islands"? Yes. " M c G o n a g l e h a s b e e n i n s t r u c t e d to a r r a n g e for the i n c o r p o r a t i o n of s e v e n 1 c o m p a n i e s of w h i c h f o u r w i l l b e t a x exempt companies. It is p r o p o s e d t h a t we shall e m p l o y the B a n k of N o v a S c o t i a T r u s t C o m p a n y as T r u s t e e s ; B a r c l a y s D C & O as B a n k e r s a n d W S . W a l k e r as S o l i c i t o r s "? 2 3 4 5 Yes . 6 50 Q 7 A 8 51 Q 9 T h a t w a s p u t t i n g m u c h m o r e o r g a n i s a t i o n i n t o it? Yes . So, w o u l d y o u l i k e to a d d n o w w h a t y o u w e r e g o i n g to say a m o m e n t ago? 10 A 11 52 Q 12 A The inte r e s t in t h e C a y m a n I s l a n d s . Yes ? J o h n G u i n n e s s w a s v e r y m u c h a s a i l i n g m a n a n d it is 13 m y r e c o l l e c t i o n that he w e n t on a s a i l i n g h o l i d a y 14 in t h e C a y m a n I s l a n d s . 15 o f f e r e d l and. 16 w h i c h was t h o u g h t to be r i p e for d e v e l o p m e n t . 17 he c a m e b a c k h e d i s c u s s e d t h i s w i t h h i s c o u s i n J a m e s 18 G u i n n e s s a n d it w a s d e c i d e d t o f o r m a l i t t l e c o m p a n y 19 to b u y s o m e l a n d w i t h a v i e w t o d e v e l o p m e n t . 20 53 Q 21 A 23 54 Q 24 M a y I just ask you to stop there W h a t is t h e r e f e r e n c e in t h i s M i n u t e ( E x h i b i t 3) to: " M c G o n a g l e h a s b e e n i n s t r u c t e d to a r r a n g e for the i n c o r p o r a t i o n of s e v e n c o m p a n i e s "? 26 29 When Sorry. (indicating) 25 28 A n y w a y there was land available b e c a u s e w e w i l l c o m e to t h a t j u s t i n a m o m e n t ? 22 27 A l l right. W h i l e he was t h e r e he was A Well, m y g u e s s is t h a t M c G o n a g l e w a s a m a n c a l l e d Liam McGonagle. 1 2 56 Q. 3 A. 4 5 57 Q. W h a t was the p u r p o s e of i n c o r p o r a t i n g s e v e n companies ? A. 8 9 He w a s o n e of t h e s o l i c i t o r s w h o m t h e B a n k u s e d to consult. 6 7 H o w h a d he come into the d i s c u s s i o n about C a yman? I d o n ' t k n o w n o r c a n I r e m e m b e r at t h i s stage what a t a x e x e m p t c o m p a n y is. 58 Q. Okay. L e t us t u r n t o p a g e 10 This 11 T r u s t Co. 12 June 13 A. 14 59 Q. is a M i n u t e , 294, (Cayman) 97, (Same H a n d e d ) ? e n t i t l e d " Bank of N o v a S c o t i a L t d , " a n d it is a M i n u t e of 1969? Yes. It says: 15 " J ohn Collins, Manager, has c a l l e d to se e G E J M a n d J H G i n c o n n e c t i o n w i t h t h e c o m p a n i e s b e i n g s e t u p fo r us. L. M c G o n a g l e w h o w a s p r e s e n t at t h e m e e t i n g is s a t i s f i e d w i t h t h e p r o p o s a l s w h e r e b y an ope r a t i o n can be "unscrambled" without any action having to be t a k e n in the C a y m a n I s l a n d s . " 16 17 18 19 20 21 22 W h o is t h e r e f e r e n c e t o " J o h n C o l l i n s " h e r e ? A. 23 It w a s t h e B a n k o f N o v a S c o t i a ; MS. 24 A. 25 60 Q. MACKEY: w a s n ' t i t? Yes. Nova Scotia Trust Company. MR. ROWAN: So, Mr. Collins was the M a n a g e r of t h e B a n k o f 26 27 Nova Scotia; 28 A. Yes, 29 61 Q. Yes. is t h a t r i g h t ? there were two Managers The o ther one? I think. 1 2 62 Q. Yes. So, he was the p e r s o n wit h w h o m 3 Guinness 4 N o v a S cotia or t h e y w ere the pe o p l e ? 5 A. 6 63 Q. Yes? 7 A. Yes, 8 64 Q. 9 & M a h o n d e a l t w i t h i n t h e B a n k of Evidently. I a m s u r e t h a t is so. A ll right. So, c a r r y i n g on from that: That relationship developed I assume? 10 A. 11 65 Q. Yes. If w e go t o p a g e 107, ( E x h i b i t 5) (Same H a n d e d ) 12 Mr. 13 a s k y o u w h a t is m e a n t b y u n s c r a m b l i n g i n t h e 14 previous Minute? 15 A. 16 66 Q. 17 18 No, just b e f o r e we r ea d that page c o u ld I Do y o u k n o w w h a t t h a t m e a n s ? I d o n 't . Presumably, t h o u g h it m e a n s to u n d o s o m e t h i n g t h a t has b e e n done? A. I am afraid I am compl e t e l y m y s t i f i e d by that ( E x h i b i t 4) 19 20 67 Q. 21 A. 22 23 Forwood, (indicating). The o r d i n a r y use of words m i g h t i m p l y that? Let me just read this again? I am afraid I don't u n d e r s t a n d t h a t. 68 Q. 24 I see. T h e n g o i n g o n to p a g e 107, at t h e b o t t o m , a n d M i n u t e 372 o f O c t o b e r 1 9 6 9 ? 25 A. 26 69 Q. Yes. Entitled: 27 28 29 -­ "Collins of Nova Scotia Trust C o m p a n y h a s ..." 1 2 . .put u p t o us a p r o p o s i t i o n i n v o l v i n g a l o a n t o p u r c h a s e 150 a c r e s in the Ca y m a n Island for $200,000. W e a r e o f f e r e d 9% on t h e l o a n a n d a m i n i m u m o f 25% o f t h e e q u i t y . It h a s b e e n a g r e e that JR s hall fly out to i n v e s t i g a t e t h i s p r o j e c t at o n c e . " 3 4 5 6 7 So, 8 about the land? 9 A. 10 7 0 Q. 11 A. 13 71 Q. 14 A. 15 So, t h a t is c e r t a i n l y w h a t it l o o k s like . t h e i n t r o d u c t i o n to t h a t o p p o r t u n i t y c a m e f r o m S o it a p p e a r s Right. from this ( E x h i b i t 5) (indicating). W h o is JR? There was a fellow called John Roberts who was with t h e B a n k f o r a s h o r t t i m e a n d t h a t is m y b e s t g u e s s . 72 Q. 17 18 Well, Collins putt i n g the p r oposition e f f e c t i v e l y t h e B a n k of N o v a S c o t i a ? 12 16 t h i s w a s Mr. Okay. D i d t h e l a n d d e a l g e t t h e go a h e a d ? Did the B a n k d e c i d e t o go a h e a d w i t h t h i s d e a l ? A. I c a n ' t s a y t h a t it w a s t h a t d e a l ( E x h i b i t 5) 19 (indicating) 20 i n v o l v e d i n it. It w a s a l i t t l e c o n s o r t i u m o f I 21 think Directors in L o n d o n a n d D i r e c t o r s i n D u b l i n . 22 73 Q. 23 b u t t h e r e w a s a de a l . T h i s w a s r e f e r r e d to i n y o u r l e t t e r The B a n k was not ( E x h i b i t 1). Y o u say: 24 "As a r e s u l t a s y n d i c a t e o f i n v e s t o r s b a s e d in L o n d o n p u r c h a s e d l a n d . . . " ? 25 26 A. 27 74 Q. Yes. Okay. Y o u s a y t h o s e w e r e -- t h a t s y n d i c a t e i n v o l v e d 28 D i r e c t o r s of Gui n ne s s 29 & M a h o n in L o n d o n ? & M a h o n in D u b l i n a n d G u i n n e s s 1 A. 2 3 Yes. I don't know whether there were other people involved. 75 Q . 4 A. 5 76 Q. 6 A. 7 77 Q. 8 A. 9 78 Q. 10 A. 11 79 Q. 12 A. 13 80 Q. 14 I see. I myse l f had a small participation. You had a participation? O f 1% or s o m e t h i n g . Yes. No, W a s it a s u c c e s s f u l v e n t u r e ? not really. I m e a n d i d it m a k e m o n e y ? No. It d i d n o t ? I t h i n k t h e r e are still some p r o p e r t i e s there. I see, right. statement 15 So t h a t in a n y e v e n t y o u s a y i n y o u r (Exhibit 1): " I n o r a b o u t 1 9 7 0 Mr. J. D e s m o n d T r a y n o r FCA, u p t o t h e n a p a r t n e r in the a c c o u n t a n c y firm of H a u g h e y B o l a n d j o i n e d t h e B a n k as a C o - M a n a g i n g Director with John Guinness and myself"? 16 17 18 19 A. 20 81 Q. Yes. Can you recall, Mr. Forwood, h o w it c a m e t h a t t h e 21 Ban k r e c r u i t e d someone from an a c c o u n t a n c y firm and 22 m o r e p a r t i c u l a r l y Mr. 23 A. Yes. Traynor specifically? We were conscious, w h e n I s a y "w e" I m e a n 24 G e o r g e M a h o n a n d J o h n G u i n n e s s a n d I, t h a t w e a l l 25 came from the same background. 26 in t h e s a m e s c h o o l . 27 of us r e a l l y had, 28 w i t h t h e w i d e r w o r l d a n d w e w e r e v e r y a n x i o u s to 29 e x p a n d and we w ere v ery m u c h t a r r e d w i t h the We were all e d u c a t e d We w ere all Protestants. we thought, None sufficient connection 1 Protestant b rush let's 2 employees. 3 that there was r o o m for another. 4 f o r a l o n g t i m e a n d we h a d c o m e a c r o s s , 5 had come across, 6 b u t w e had. 7 82 Q 8 f a c e it; our clients, our W e w a n t e d to c h a n g e t h i s a n d w e d e c i d e d Mr. Traynor. We d e b a t e d this a l l o f us I can't remember how W o u l d he h a v e b e e n i n v o l v e d w i t h the B a n k on b e h a l f of H a u g h e y B o l a n d c l i e n t s ? 9 A 10 83 Q 11 A 12 He c o u l d h a v e b e e n . He c o u l d h a v e been. B e c a u s e if y o u d i d n o t . . . ( I N T E R J E C T I O N ) ? But in any event we all knew h i m for b u s i ne s s reasons. 13 84 Q 14 A 15 85 Q 16 A Right? So, I s uppose t hat's v e r y likely. Yes? We, t h e t h r e e of us t a l k i n g t o g e t h e r , w r o t e out a 17 specification, 18 a n d s o m e b o d y s a i d t h i s c o u l d b e T r a y n o r a n d we 19 a p p r o a c h e d him. 20 h eart a t t a c k a nd I can r e m e m b e r h i m saying, 21 u n t i l t o m o r r o w to d e c i d e w h e t h e r t o t e l l m y w i f e . 22 If I t e l l m y w i f e I s h a l l a c c e p t b e c a u s e 23 make me." 24 us a n d t h i s p r o b a b l y t e l l s u s w h e n ; 25 (indicating) 26 a b o u t 1 9 7 0 b u t it m a y h a v e b e e n e a r l i e r f o r a l l I 27 know. 28 29 a k i n d o f t h i n g w e w e r e l o o k i n g for, He h a d r e c e n t l y h a d a v e r y s e r i o u s "Give me sh e w i l l A n y w a y he d i d tell his w i f e a n d he j o i n e d ( E x h i b i t 1)? d o e s n ' t it I w o u l d h a v e p u t it 1 2 8 6 Q. MR. ROWAN: You o b v i o u s l y thought that 3 Mr. 4 n e c e s s a r y skills, 5 A. 6 87 Q. 7 A. 8 88 Q. 9 A. 10 8 9 Q. 11 A. 13 90 Q. 14 15 Yes. In the w i d e r c i r c l e ? Yes. In I r e l a n d ? Yes. Y o u i n v i t e d h i m to join a n d yo u m a d e h i m a A. W h a t h a p p e n e d to t h e r e s p o n s i b i l i t i e s w h e n Traynor came? Well, evidently, Did that change things? yes, but arrangements continued b e t w e e n t h e f o u r o f us. 17 91 Q. 18 A. 19 92 Q. 20 Y o u w e r e c o n t i n u i n g to u s e t h e P a r t n e r s R o o m ? Yes. A n d t h e r e w e r e h o w m a n y o f y o u u s i n g t h e r o o m th e n ; three? 21 A. Four. 22 93 Q. Four. 23 A. Well, 24 94 Q. 25 I t h i n k four. B y t o d a y ' s w a y o f d o i n g t h i n g s t h a t is a s t r a n g e arrangement ? 26 A. 27 95 Q. 29 Guinness and yourself? Yes. Mr. 16 28 ability and importantly contacts? C o - M a n a g i n g D i r e c t o r w i t h Mr. 12 Tray n o r h a d the Yes. I m e a n there w o u l d have bee n four t e lephones and 1 96 Q. 2 A. H o w d i d that w o r k in p r a c t i c a l ter m s ? Well, I h a v e to t e l l y o u t h a t t h e w o r l d h a s c h a n g e d . 3 I m e a n t h e c o n c e p t of a M e r c h a n t B a n k I f a n c y h a s 4 r e a l l y g one. 5 97 Q. 6 They were fairly old fashioned. What does that mean? Can you e x p l a i n to me what old fashioned means? 7 A. 8 98 Q. 9 A. I w i l l try. A s y o u u n d e r s t a n d it? Well, for e xa m p l e the Partners: We weren't Partners 10 b u t it w a s s t i l l c a l l e d t h e P a r t n e r s R o o m . 11 P a r t n e r s u s e d to s i t in o n e ro o m . 12 D i r e c t o r o f q u i t e an i m p o r t a n t p u b l i c c o m p a n y in 13 the United Kingdom, 14 s e l l e r s / s t a t i o n e r s etc. 15 p a r t n e r s h i p and the D i r e c t o r s of the p u b l i c c o m p a n y 16 sa t i n o n e l a r g e r o o m at d i f f e r e n t d e s k s . 17 99 Q. 18 A. 19 100 Q. 20 A. 21 101 Q. 22 A. 23 24 in Britain, etc ., The I me a n I was a and they were book and they had been a In a s i m i l a r w a y ? Yes. To G u i n n e s s & Mahon? Yes. I see? T h i s is w h y I s a y l i f e h a s c h a n g e d . It w a s n ' t u n u s u a l then . 102 Q. Right. A n y w a y w h e n Mr. T r a y n o r c a m e o n b o a r d he 25 s e e m e d to b e c o m e i n v o l v e d in the C a y m a n s i t u a t i o n 26 quite quickly? 27 A. 28 103 Q. 29 I t h i n k so. Okay. A m I r i g h t in b e l i e v i n g t h a t G u i n n e s s & Mahon 1 trust arrangements 2 w o u l d have b e e n a number of w e a l t h y families 3 w h o m the B a n k w o u l d have o p e r a t e d h i s t o r i c a l l y ? 4 It c o u l d w e l l b e t h e r e w a s a C h a n n e l 5 W h e n it h a p p e n e d : 6 h a p p e n e d b e f o r e or a fter the C a y m a n Islands: 7 I can't remember. 8 104 Q 9 Yes. in t h e C h a n n e l I don't know. A 11 105 Q 12 A 13 106 Q for I s l a n d s one. W h e t h e r it It w a s v e r y l i k e l y b e f o r e . M a y w e h a v e p a g e 117, please, ( E x h i b i t 6) t h e s e c o n d M i n u t e , 10 Islands and there (Same H a n d e d ) ? 166/7? Yes . Of June 1970? Yes . Mr. T r a y n o r " r e p o r t e d o n h i s m e e t i n g in L o n d o n . It w a s n o t e d t h a t it w a s n o w d e c i d e d t o go a h e a d w i t h t h e i n c o r p o r a t i o n of G u i n n e s s M a h o n B a h a m a s T r u s t Ltd. J . D . T . i n d i c a t e d t h a t as a r e s u l t of t h e L o n d o n m e e t i n g if t h e d e c i s i o n w a s f i n a l l y r e a c h e d to p r o c e e d w i t h t h e i n c o r p o r a t i o n of a B a n k in the C a y m a n the n a m e to be u s e d w o u l d b e G.M. C a y m a n T r u s t L t d a n d it w o u l d t h e n a l s o b e d e c i d e d to h a v e t h e share capital of bot h the Bahamas Trust Company and Cayman Trust Company owned b y a n e w h o l d i n g c o m p a n y in C a y m a n e t c . "? 14 15 16 17 18 19 20 21 22 A 23 107 Q Yes . So, this s eems to h a v e b e e n a d e c i s i o n that 24 following some discussion with Guinness Mahon 25 in L o n d o n it w a s d e c i d e d t o c r e a t e G u i n n e s s M a h o n 26 Cayman Trust? 27 A 28 108 Q 29 A Evidently, yes. 1 2 Mahon Cayman Trust 3 A Yes . 4 110 Q Page 118, please started off? (Same H a n d e d ) ( E x h i b i t 7)? T h a t is 5 a s i m i l a r M i n u t e o f a d i f f e r e n t b o d y so w e c a n p a s s 6 b y that. 7 A 8 111 Q 9 It is e x a c t l y t h e s a m e w o r d i n g ? Right. P a g e 11 9 (Same H a n d e d ) ; Minute 1 6 6 / 7 of t h e 1 6 t h J u l y 1970: 10 "Mr. T r a y n o r p r o d u c e s a m e m o r a n d u m on the p r o p o s a l to i n c o r p o r a t e G u i n n e s s M a h o n C a y m a n T r u s t L t d as a h o l d i n g c o m p a n y f o r o u r v a r i o u s i n v e s t m e n t s in Cayman. A g r e e d that the e s t a b l ishment of t h i s c o m p a n y is d e s i r a b l e . . . " 11 12 13 14 A n d t h a t Mr. 15 s o m e o n e r e f e r r e d t o as H M S ? 16 A 17 112 Q 18 A 19 113 Q 20 A 21 114 Q 23 A 24 115 Q 25 So, t h a t w a s t h e go a h e a d ? He w a s a L o n d o n D i r e c t o r I t h i n k . I see, Well, ri g h t , okay. Do y o u k n o w h i s n a m e ? if I a m r i g h t it w o u l d be. I see, His name w o u l d be Okay? A w e l l k n o w n b a n k i n g name . Yes. T u r n i n g t o p a g e 125, a Minute 26 A 27 116 Q 29 Yes . Hugh Sassoon. 22 28 Traynor will pursue the m a tter with (Same H a n d e d ) . T h i s is I t h i n k o f 1 9 7 1 a n d at 6 6 7 / 2 ? Yes . "The e x e c u t i v e council...", w h i c h I t a k e it to be in t h e C a y m a n I s l a n d s ? 1 2 3 " . . . h a v e a p p r o v e d in p r i n c i p l e t h e a p p l i c a t i o n for a b a n k i n g licence. The C o m p a n y has n o w b e e n i n c o r p o r a t e d a n d we h a d s u b s c r i b e d in full for the is s u e d share capital of J a m aican D ollars $ 20,000 w h i c h s um for the pres e n t has b e e n d e p o s i t e d wit h us." 4 5 6 7 8 So, 9 it s b a n k i n g l i c e n c e a n d it w a s r e a d y t o g o? 10 A 11 118 Q 12 GMCT had been incorporated and had had approved Yes . T u r n i n g b a c k to y o u r l e t t e r yo u sa y ( E x h i b i t 1): " P r o b a b l y in c o n n e c t i o n w i t h t h i s t r a n s a c t i o n . .." 13 14 W h i c h was the l and deal we t a l k e d about earlier, " . . .two y o u n g m e n w h o h a d b e e n w o r k i n g for anot h e r b a n k in the Ca y m a n Islands b e c a m e a w a r e o f t h e e x i s t e n c e of t h e Bank"? 15 16 17 18 A 19 119 Q 20 A 21 120 Q 22 A Yes . And subsequently.. . (INTERJECTION)? If I c o u l d j u s t i n t e r r u p t for a second? Yes? It's e vident from what you have shown me that 23 t h e s e q u e n c e o f e v e n t s w a s n o t e x a c t l y as I h a d 24 r e m e m b e r e d it. 25 121 Q Yes. However, in a n y e v e n t M e s s r s . Collins and 26 F urze w e r e a c t i n g on b e h a l f of the B a n k of N o v a 27 S c o t i a in t r a n s a c t i o n s 28 was involved? 29 in w h i c h G u i n n e s s & Mahon 1 2 "Subsequently they appro a c h e d the Bank a n d s a i d t h e y w o u l d l i k e to e s t a b l i s h a n e w b a n k in w h i c h t h e y w o u l d h a v e a shareholding"? 3 4 5 A I e v i d e n t l y g o t t h a t w r o n g b e c a u s e it a p p e a r s 6 here 7 B a n k w a s in e x i s t e n c e b e f o r e t h e y a p p r o a c h e d . 8 123 Q 9 (indicating) Yes. (Exhibit from 9) t h a t t h e C a y m a n I s l a n d I t h i n k t h a t is c o r r e c t from the chronology of t h e t h i n g ? 10 A 11 124 Q Yes, yes. However, in a n y e v e n t a c o n t a c t w a s m a d e . Someone 12 m a d e a s u g g e s t i o n to s o m e o n e a b o u t t h e m l e a v i n g t h e 13 B a n k of N o v a S c o t i a an d j o i n i n g G M CT? 14 A them. 15 16 125 Q 17 A 18 126 Q 19 20 A 127 Q W h o t h e n b e c a m e i n v o l v e d in d e t e r m i n i n g w h e t h e r t h e y Whose r e s p o n s i b i l i t y was that? I s u p p o s e it w a s a j o i n t r e s p o n s i b i l i t y . I m e a n it Right. However, d i d s o m e o n e h a v e c a r r i a g e of t h e i m p l e m e n t a t i o n of it? A 25 26 Yes . was a Board decision. 23 24 T h e y s a i d we c o u l d be of h e l p to you? should join GMCT? 21 22 I am fairly certain that the initiative came from T h a t I s i m p l y d o n o t know. played because 128 Q Yes. I know what part I I d i d t h e l a w y e r ' s j o b at t h a t st a g e . Y o u s a y t h a t it w a s c o n s i d e r e d t h a t t h e y h a d 27 useful 28 deposits 29 U n i t e d States of A m e r i c a ? c o n n e ct i o n s a nd w o u l d be able to attract from overseas, p a r t i c u l a r l y from the 1 2 3 "As a n e x - l a w y e r I p l a y e d a p a r t in d r a w i n g up a " p a r t i c i p a t i o n agreement" " 4 5 U n d e r w h i c h e a c h of t h e t w o w o u l d o w n y o u t h i n k 20% 6 of t h e i s s u e d s h a r e c a p i t a l a n d t h e B a n k w o u l d o w n 7 the balance? 8 A 9 130 Q 10 Yes . So t h a t Mr. C o l l i n s w o u l d h a v e 2 0% a n d Mr. w o u l d have 20%? 11 A 12 131 Q Yes . A n d the remaining 60% w o u l d b e h e l d b y G u i n n e s s & Mahon? 13 14 A 15 132 Q I t h i n k so. Right. What did that p a r t i c i p a t i o n agreement 16 contain? 17 you can recall, 18 Furze A W h a t t e r m s d i d it h a v e i n it as f a r as Mr. Forwood? I real l y don't recall. The o b j e c t of the e x e r c i s e 19 was : 20 S c o t i a a n d w e r e g o i n g t o p l a y a n i m p o r t a n t p a r t in 21 t h e d e v e l o p m e n t o f t h e b a n k i n C a y m a n a n d it w o u l d 22 b e as w e l l t o t i e t h e m in. 23 133 Q 24 A 25 These two y oung m e n h a d left the Ban k of Nova H o w s e n i o r w e r e t h e y i n t h e B a n k of N o v a S c o t i a ? Well, I t h i n k t h e y w e r e r u n n i n g the B a n k of N o v a Scotia's Cayman Islands operation. 26 134 Q 27 A 28 135 Q 29 A Trust? S u b s i d i a r y o r w h a t e v e r it was. Yes? 1 1 3 6 Q. 2 A. 3 137 Q. 4 A. 5 138 Q. 6 A. 7 1 3 9 Q. Yes. By giving them a shareholding? Yes, and a fairly generous s h a r e h o l d i n g at that. A n d t h e y w e r e a p p o i n t e d as d i r e c t o r s ? Presumably. W o u l d t here h ave b e e n a ny clauses in the agr e e m e nt to prev e n t t h e m leaving? 8 9 S o t h e i d e a w a s t o t i e t h e m in? A. Very likely but I don't remember. I mean I think 10 it w o u l d h a v e b e e n d i f f i c u l t t o e n f o r c e i f t h e r e 11 were . 12 140 Q. 13 A. 14 Yes? T h e i d e a w a s to g i v e t h e m s u f f i c i e n t i n d u c e m e n t t o stay. 15 141 Q. 16 A. 17 142 Q. So, they became involved? Yes. I h a v e n o t g o t m u c h i n f o r m a t i o n as t o w h e n t h a t was; 18 do you? 19 our conversation? 20 A. 21 143 Q. 22 A. 23 144 Q. 25 A. 26 145 Q. 27 28 29 Yes? M y g u e s s is t h a t -- t h a t o n e is n o t d a t e d (indicating). (Exhibit P r e t t y e a r l y on I think. Right? E a r l y on. B e c a u s e p r e s u m a b l y s o m e o n e h a d to ru n the B a n k once it w a s A. I m e a n i n t h e l i g h t of I w o u l d h a v e t h o u g h t . .. 9) 24 Can you remember? Yes. set up ? 1 in t h e C a y m a n I s l a n d s t o r u n it so it f o l l o w s 2 suppose that they would have been r e c r uited quite 3 s o o n a f t e r its i n c o r p o r a t i o n ? 4 I g u e s s so. 5 o b t a i n e d a n d t h e r e is a r e f e r e n c e h e r e t o t h e 6 Executive council 7 147 Q 8 A 9 11 148 Q 9) (indicating). I t hink they p r o b a b l y p r i c k e d up their ears and said D i d Mr. So, m y g u e s s f a i r l y e a r l y on. T r a y n o r p l a y a p a r t in t h e i m p l e m e n t a t i o n of this or d i d yo u p l a y a p a r t ? 13 A 14 149 Q 15 A 16 No. O r Mr. 150 Q Guinness? Perhaps but the major part w ould have certainly been Mr. 18 19 (Exhibit Right? is t h a t it w a s 12 17 I m e a n I t h i n k once the licence was " T h e r e is a n o p p o r t u n i t y f o r us h e r e . " 10 I Tr a y n o r who r a t h e r t o o k o ver this aspect. Yes. So, once Guinness Mahon Cayman Trust had been se t u p w h a t s e r v i c e s d i d it o f f e r ? A T h e r e is a lo t o f g u e s s - w o r k h e r e b e c a u s e I can't 20 remember. I t h i n k it 21 took deposits 22 b a s e d a n y w h e r e a n d I t h i n k it w a s a c o n v e n t i o n a l 23 banking business. 24 151 Q 25 A 26 152 Q 27 A 28 153 Q 29 A I d i d n ' t p l a y a n a c t i v e r ol e . from e x p a t r i a t e A m e r i c a n s who m i g h t be T h e y l e n t t h e i r fu n d s . D i d it t a k e d e p o s i t s I d o n ' t know. Okay. from Ireland? It is p o s s i b l e b u t I d o n ' t know. C a n w e t u r n to p a g e . . . ( I N T E R J E C T I O N ) ? B e c a u s e s h o r t l y -- s o r r y to i n t e r r u p t . Yes? Shortly after that Exchange Control Regulations 25 1 w e r e i n t r o d u c e d i n t o I r e l a n d so t h a t I r a t h e r d o u b t 2 w h e t h e r I r i s h f u n d s c o u l d h a v e b e e n t r a n s f e r r e d to 3 the Cayman Islands; 4 154 Q 5 A Yes ? I d o n ' t k n o w if a n y b o d y k n o w s w h e n t h e s e R e g u l a t i o n s were introduced. 6 7 I think. 155 Q However, if f u n d s h a d a l r e a d y b e e n o u t s i d e of 8 I r e l a n d of course the y m i g h t have b e e n t r a n s f e r r e d 9 there? 10 A thought. 11 12 That w o u l d have be e n p e r m i s s i b l e I w o u l d have 156 Q 13 They might have been beneficially owned by someone in Irela n d ? 14 A 15 157 Q 16 A Yes . 17 158 Q Page 18 A 19 159 Q 20 21 22 T h e y c o u l d w e l l be. However, 129, already outside please Ireland? (Same H a n d e d ) (Exhibit 10 )? Thanks. Minute 66 7/ 5. The date of t hese M in u t e s c l e a r b u t it is Mr. are not Traynor; "Agreed that any d i f f e r e n t i a l on b ack to b a c k a r r a n g e m e n t s inv o l v i n g o u r s e l v e s a n d C a y m a n w i l l in n o r m a l circumstances be split equally." 23 24 W h a t d o e s t h a t t e l l us, 25 N o w t o m e a b a c k t o b a c k a r r a n g e m e n t is o n e w h e r e 26 t h e r e is a b o r r o w i n g a n d t h e r e is a l e n d i n g . 27 t h e s u g g e s t i o n is t h a t t h e r e c o u l d b e p r e s u m a b l y 28 l e n d i n g from the Ca y m a n and b o r r o w i n g in Dublin. 29 Mr. Forwood? So, 1 160 Q. presumably from Guinness 2 3 A. 4 & Mahon? P r e s u m a b l y b e c a u s e it d o e s s a y a n y d i f f e r e n t i a l 161 Q. 6 A. 7 162 Q. Yes? So, t h a t is w h a t it s u g g e s t s . Yes. T h e n the b a c k to b a c k a r r a n g e m e n t w o u l d involve a deposit? 8 9 A. 10 163 Q. 11 A. 164 Q . 13 Well, t h a t s e e m s so. In C a y m a n ? T h a t is w h a t it s e e m s t o s u g g e s t . Yes. MS. MACKEY: 14 15 A. MS. MACKEY: 19 Well, MS. MACKEY: So, A. if y o u a c t u a l l y do n o t Well, w h a t w e w a n t to " d o n 't k n o w s ". 24 MS. A. 26 y o u s h o u l d s a y so. MACKEY: Yes. D u r i n g the c o u r s e of this i n t erview. MS. 27 know, I a m a f r a i d t h e r e is g o i n g t o b e a l o t of 23 29 However, g e t f r o m y o u is e v i d e n c e . 21 28 Forwood? I am guessing. 20 25 Do y o u k n o w w h a t it m e a n s , Mr. A. Forwood? Sorry? 17 22 Do y o u k n o w w h a t it m e a n s , Mr. 16 18 in normal circumstances will be split equally. 5 12 So that s o m e o n e in I r e l a n d m i g h t t a k e a l o a n MACKEY: If t h a t is t h e c a s e y o u s h o u l d j u s t s i m p l y s a y so. A. B e c a u s e i t ' s a l o n g t i m e ago. 1 MS. 2 3 A. MACKEY: Yes. A n d I m a y w e l l h a v e b e e n a d i r e c t o r of t h e C a y m a n 4 Island Company but 5 Board meeting. 6 and I think I only met Collins and Furze about once 7 each. 8 165 Q. MR. I certainly never attended a I n e v e r w e n t to t h e C a y m a n I s l a n d s ROWAN: However, 9 I believe I am correct in saying that you a r e t r a i n e d as a c o m m e r c i a l 10 11 A. 12 1 6 6 Q. 13 A. 14 167 Q. 15 lawyer? Sorry? Y o u a r e t r a i n e d as a c o m m e r c i a l l a w y e r ? Yes. A n d that you were with Guinness & M a h o n for seven years approximately? 16 A. 17 168 Q. 18 Yes. A n d t h a t s u b s e q u e n t l y y o u t e l l us y o u se t u p as a financial 19 A. 20 1 6 9 Q. consultant? Yes. I i m a g i n e t h a t w o u l d have , a l l o f t h a t w o u l d ha ve, 21 g i v e n y o u an o p p o r t u n i t y to u n d e r s t a n d a b o u t b a c k to 22 back arrangements? 23 A. 24 170 Q. Yes. I m e a n Ms. M a c k e y w a s a s k i n g you: Did you 25 u n d e r s t a n d w h a t a b a c k to b a c k a r r a n g e m e n t was. 26 MS. MACKEY: 27 No, no. So r r y , No, Mr. I w a s not. Rowan. What 28 w a s a s k i n g is: 29 m e a n t b y the specific t hing and in other words did W h e t h e r Mr. F o r w o o d knew what was I 1 he r e c o l l e c t t h i s d i s c u s s i o n . 2 you, 3 b e i n g s p o k e n a bout in this p a r t i c u l a r mi n u t e ; 4 t h e s p l i t in t h e d i f f e r e n t i a l a n d w h e t h e r y o u 5 re c ollected the circumstances? 6 Well, 7 MS. Mr. Forwood, was w h e t h e r you k new what was MACKEY: Yes. Whet h e r you r e c o l l e c t it n o w r e a l l y is 9 w h a t I want to know? A 11 12 namely I t h i n k I m u s t h a v e known. 8 10 What I was asking 171 Q No, I d o n ' t r e c o l l e c t it. MS. MACKEY: Yes. MR. ROWAN: What 13 I w a s t r y i n g to establish was that you 14 u n d e r s t o o d e v e n if y o u do n o t r e c o l l e c t t h e 15 parti c u l a r d iscussion but you u n d e r s t a n d what 16 t h i s m i n u t e is s a y i n g 17 A 18 172 Q 19 A (Exhibit 1 0) ? I h a v e g i v e n y o u m y i n t e r p r e t a t i o n of it. W h a t is t h e r e f e r e n c e t o " a n y d i f f e r e n t i a l " ? Well, p r e s u m a b l y t h e i n t e r e s t r a t e c h a r g e d on t h e 20 loan would have been higher than the interest rate 21 a l l o w e d on the deposit. 22 173 Q 23 A 24 174 Q 25 A 26 175 Q Yes? So, there would be a differential. Right? I m e a n t h a t is m y i n t e r p r e t a t i o n . A l l right. The Cayman Islands and Guinness Mahon 27 C a y m a n T r u s t w a s i n v o l v e d in a r r a n g e m e n t s 28 b a c k to b a c k l e n d i n g ? 29 A involving 1 2 176 Q 3 A Yes . 4 177 Q Page 5 131 (Same H a n d e d ) . F e b r u a r y 1972 6 A 7 178 Q 8 A 9 179 Q T h i s is M i n u t e 6 6 7 / 8 of (Exhibit 11)? Yes . A n d it is t h e b o t t o m of t h e m i n u t e ? Yes . W h e r e Mr. T r a y n o r is r e p o r t i n g t h a t he h a s h a d a 10 s e r i e s of m e e t i n g s w i t h J o h n F u r z e a n d K e n n e d y 11 Crowley. "There have b e e n a n u m b e r of enquiries about sett i n g up D i s c r e t i o n a r y S e t t l e m e n t s ." 12 13 14 15 Can you recall anything about that minute 16 1 1 )? 17 A 18 180 Q 19 20 (Exhibit No. Can you express s o m e v i e w s as to w h a t t h e m e a n i n g of it is? A I don't know w h e t h e r I can really. 21 e l a b o r a t e o n w h a t is s a i d t h e r e 22 ( E x h i b i t 11). 23 181 Q 24 A 25 182 Q 26 A 27 183 Q I can't (indicating) W h o is K e n n e d y C r o w l e y ? They are a firm of c h a r t e r e d accountants. I see, right? I p r e s u m e t h e y s t i l l are; Yes. aren't they? It s a y s t h e r e h a v e b e e n a n u m b e r o f e n q u i r i e s 28 about setting up d i s c r e t i o n a r y settlements. 29 was in 1972? That 1 2 Was that w h e n the p r o s p e c t of p r o v i d i n g 3 D i s c r e t i o n a r y S e t t l e m e n t s or D i s c r e t i o n a r y Trusts 4 s t a r t e d t o b e c o m e i m p o r t a n t to G u i n n e s s 5 Guinness Mahon Cayman Trust? 6 A 7 8 I d o n ' t kn ow. guess 185 Q 9 I did, However, If I s a w t h i s at t h e t im e , it w a s 28 y e a r s ago. A 11 186 Q which I I h a v e n o ide a. y o u a r e f a m i l i a r w i t h t h e t o p i c of a d i s c r e t i o n a r y trusts; 10 & Mahon and are you not? Yes . Yes. So, this seems to suggest, d o e s it not, 12 that Guinness M ahon Cayman Trust were also 13 i n v o l v e d i n t h e i d e a of p r o m o t i n g d i s c r e t i o n a r y 14 trusts ? 15 A 16 187 Q 17 A 18 188 Q So it s u g g e s t s . In 1 9 7 2 ? Yes . Right. P a g e 13 (Same H a n d e d ) (Exhibit 1). Going 19 b a c k to your statement, 20 at p o i n t n u m b e r f i v e at t h e b o t t o m of p a g e 2 of 21 that? 22 A 23 189 Q 24 26 190 Q 27 A 29 Yes . Y o u say: "In or a b o u t 1973 M a u r i c e O ' K e l l y was i n v i t e d to j o i n t h e B a n k a n d i n e f f e c t became a fourth Co-Managing Director." 25 28 to the A u t h o r i s e d Officer, W h a t was the r e as o n for that a p p o i n t m e n t ? He w a s a f r i e n d of Mr. Traynor. as a C h a r t e r e d A c c o u n t a n t . He h a d p r a c t i s e d I t h i n k he m a y h a v e 1 He p r a c t i s e d as a C h a r t e r e d A c c o u n t a n t in 2 Hong Kong and again I think this was the time 3 w h e n G e o rg e M a h o n was in s i s t i n g on r e t i r i n g and 4 a g a i n we th o u g ht there was r o o m for a v a c a n c y and 5 this 6 r e c o m m e n d a t i o n f r o m Mr. 7 191 Q 8 A 9 192 Q 10 A 11 193 Q 12 A 13 194 Q 14 A 15 195 Q 16 17 A T r a y n o r t o t a k e h i m on. O ' K e l l y b r i n g to t h e B a n k ? He w a s a C h a r t e r e d A c c o u n t a n t . W a s he a B a n k e r ? No. Yes ? We w ere v e r y short on bankers. D i d h e b r i n g w i t h h i m a b u s i n e s s of s o m e s o r t ? No. Okay. W h e n he a r r i v e d : Did that change To an e x t e n t i n e v i t a b l y b ut we n e v e r h a d five in the r o o m b u t w e h a d four. 196 Q A f t e r Mr. O ' K e l l y s e t t l e d in d i d a n y one b e c o m e slightly more dominant than the others? 20 21 W h a t d i d Mr. that t here was a v e r y strong responsibilities? 18 19 I do r e m e m b e r ; A Well, John Guinness was the Chairman. Although my 22 e x p e r i e n c e w a s s h o r t it w a s l o n g e r t h a n t h a t o f t h e 23 others but 24 o n it t h a t Mr. 25 personality. 26 How did that show itself? 27 He w a s r a t h e r i n c l i n e d to d o h i s o w n t h i n g p e r h a p s 28 w i t h l e s s c o n s u l t a t i o n t h a n o t h e r s o f us w o u l d h a v e 29 thought desirable. I s u p p o s e I h a v e to c o n f e s s l o o k i n g b a c k Traynor was very a very dominant Y o u k n o w t h a t t h i s is n o t 1 i n t e n d e d as a c r i t i c i s m o f h i m b u t p e r h a p s t h a t 2 is s o . 3 At a r o u n d that time in the 1970's 4 it is c o r r e c t in s a y i n g t h a t Mr. 5 a C o - M a n a g i n g D i r e c t o r a n d h e also, 6 m a y h a v e b e e n t h e C h a i r m a n o f C a y m a n at t h a t t i m e ? 7 A 8 199 Q 9 A 10 20 0 Q Tr a y n o r was I believe, I g u e s s h e p r o b a b l y was. Yes? T h a t w a s c e r t a i n l y in h i s p r o v i n c e . Yes. Did any one feel that that was quite a l o t of p o w e r v e s t i n g in o n e i n d i v i d u a l ? 11 12 A 13 20 1 Q 14 No, I d o n ' t t h i n k so. Right. Y o u t h e n say: "In 1976 I d e c i d e d to d i s c o n t i n u e m y em p l o y m e n t w i t h the B a n k a nd r e s i g n e d as a D i r e c t o r ." 15 16 17 I believe W h a t p r o m p t e d y o u to l e a v e ? A I w o u l d say there were two pri n c i p a l reasons. 18 T h e fi r s t : 19 business 20 as q u a l i t y w o r k p a r t i c u l a r l y , 21 in m y own field. 22 of I r e l a n d a n d A l l i e d I r i s h B a n k s , 23 subsidiaries 24 t h e y h a d e n o r m o u s p o w e r to d i r e c t t h e i r b a n k i n g 25 c l i e n t s to t h e i r M e r c h a n t B a n k i n g s u b s i d i a r i e s a n d 26 I c a m e to t h e c o n c l u s i o n t h a t w e m u s t c u t b a c k a n d 27 t h a t e i t h e r De s T r a y n o r o r I o u g h t t o w i t h d r a w . 28 29 We h a d s u c c e e d e d in e x p a n d i n g our and I t h i n k the w o r k we d i d was r e c o g n i s e d I w o u l d l i k e to t h i n k , The c l e a r i n g banks, as M e r c h a n t B a n k s . the Bank b o t h set up We d i s c o v e r e d that 1 N u m b e r t w o is t h a t s h o r t l y b e f o r e t h a t t h e r e 2 h a d b e e n a s o - c a l l e d m e r g e r in L o n d o n b e t w e e n 3 Guinness Mahon, 4 & Pe at. 5 were commodity brokers 6 was a fellow called Kissin, 7 o r i g i n a l l y from Danzig. 8 n o r e a s o n t o s u p p o s e he l i k e d m e e i t h e r . 9 p a r t i c u l a r l y o f fended me was a very strong rumour t h e Ban k, and a company called Lewis I r e m e m b e r the n a m e well. I think. Lewis & Peat The boss man K-i-s-s-i-n, who came I didn't like him and have What 10 t h a t he w a s a b o u t to b e e n n o b l e d b y H a r o l d W i l s o n , 11 w h o w a s at t h a t t i m e P r i m e M i n i s t e r i n E n g l a n d , 12 f o r a r e a s o n w h i c h I w o u l d h a v e r e g a r d e d as 13 d i s c r e d i t a b l e a n d I w a s h a p p y t h a t I s h o u l d go 14 a n d De s s h o u l d stay. 15 20 3 Q 16 A 17 204 Q In a n y e v e n t y o u d e c i d e d t o w i t h d r a w ? To withdraw. A n d you say that ( E x h i b i t 1): 18 "Thereafter, 19 w i t h t h e B a n k w a s as a t e n a n t f r o m 197 6 20 to 1 9 7 8 o f a s m a l l o f f i c e in a s e p a r a t e 21 bu ilding near the Bank's College Green 22 premises 23 p r a c t i c e as a F i n a n c i a l a n d L e g a l 24 C o n s u l t a n t ." the only contact I had from w h i c h I c a r r i e d on a 25 26 So, 27 after that time? 28 29 A No. you h a d no contact wit h Guinness & Mahon 1 2 206 Q 3 A 4 207 Q 5 You make a statement? Yes . A n d I j u s t w o n d e r e d w h e t h e r t h a t s t a t e m e n t is comprehensive? 6 A 7 208 Q 8 A 9 209 Q 10 A 11 21 0 Q Yes . It is? I t h i n k so. Did you ever? Unless I have m i s u n d e r s t o o d what you are saying. I m e a n w e r e y o u e v e r i n v i t e d to a c t as a 12 n o n - e x e c u t i v e D i r e c t o r f o r i n s t a n c e o n a n y of 13 the equity adventures which Guinness 14 w e r e i n v o l v e d in? 15 A 16 21 1 Q 17 18 no. D i d y o u e v e r ge t a s k e d f o r a d v i c e b y a n y o n e in Guinness A 19 20 No, & Mahon & Mahon; p a r t i c u l a r l y Mr. I t h i n k m a r k e d l y not. I thought Traynor? I might have been but I wasn't. 212 Q Right. So t h a t a f t e r y o u left, as I u n d e r s t a n d it, 21 t h e r e w a s a c h a n g e in t h e m a n a g e m e n t 22 Are you aware of that? 23 Deputy Chairman and Managing Director? 24 A 25 21 3 Q 26 A 27 214 Q 28 A 29 Mr. structure. Tray n o r bec a m e the I m i g h t h a v e b e e n a w a r e o f it at t h e ti m e . Yes ? I n c i d e n t a l l y I l e f t ou t o n e s m a l l t h i n g . Yes? In r e p l y t o y o u r p r e v i o u s q u e s t i o n as t o w h y I l e f t t h e B a nk . 1 21 5 Q 2 A I had been offered another job which sounded a very 3 a t t r a c t i v e one a n d for a s t r a n g e r e a s o n this 4 t h r o u g h a n d t h a t is w h y I se t m y s e l f u p as a 5 Financial and Legal Consultant; 6 mean. 7 216 Q 8 A 9 217 Q whatever that may I d i d n ' t r e a l l y know. Okay? I w a i t e d f o r p e o p l e t o c o m e to me. Okay. Finally, from m y e nd of things: Did you come across a man called Jack Stakelum? 10 11 A 12 218 Q 13 14 fell Yes . W e r e y o u a w a r e of hi s r e l a t i o n s h i p w i t h Mr. Guinness A No. Traynor, & Mahon and Cayman? Well, I c a n r e m e m b e r t h a t he w a s a p a r t n e r 15 i n H a u g h e y B o l a n d a n d I t h i n k w a s v e r y c l o s e to 16 Mr. 17 connection with the Cayman company nor indeed would 18 I have bee n aware that he h a d any c o n n e c t i o n with 19 Guinness & Mahon. I see. Okay. 20 21 219 Q Traynor. I was not a w a r e that he h a d any Thank you ve r y much. Ms. Mackey w i l l t a k e o v e r s o m e of t h e q u e s t i o n s . 22 23 24 25 26 27 28 29 E N D O F E X A M I N A T I O N O F MR. F o r w o o d B Y MR. ROWAN: 1 2 3 4 MS. MACKEY: 5 Mr. Forwood, as y o u know, as I t h i n k w e e x p l a i n e d to 6 you, 7 of t h e t h i n g s t h a t we h a v e b e e n a s k e d b y t h e H i g h 8 C o u r t t o do ? 9 A 10 22 1 Q 11 A 12 222 Q we are i n v e s t i g a t i n g Yes . Is t o i d e n t i f y t h e c l i e n t s o f " A n s b a c h e r " C a y m a n ? Yes . A n d it is r e a l l y i n t h a t g e n e r a l a r e a t h a t I w a n t e d 13 to ask you some questions. 14 right? 15 A 16 22 3 Q 17 A "Ansb a c h e r " C a y m a n a nd one Can you h e a r me all Well. I c a n sit u p n e a r e r t o y o u i f it is a n y b e t t e r ? I a m g o i n g to t r y w h a t I c a l l m y I r i s h h e a r i n g a i d 18 a n d I a m g o i n g t o t r y -- it s o u n d s t e r r i b l y s e x i s t 19 b u t . . . (INTERJECTION). 20 224 Q 21 A A w o m a n ' s v o i c e is l i g h t e r ? It is k n o w n as h i g h t o n e d e a f n e s s w h i c h m e a n s m u c h b e t t e r on m e n than I am on women. 22 23 22 5 Q 24 A 25 226 Q 26 A Yes . 27 227 Q Good. 28 29 I am W o u l d it b e b e t t e r if I s a t n e a r e r ? A c t u a l l y it is n o t w o r k i n g t o o b a d l y . Is it? ago? A Had you heard what I said there a few moments 1 228 Q 2 A 3 229 Q 4 I t h i n k so. So, it is in t h a t c o n n e c t i o n t h a t I n o w w a n t t o a s k you some questions. 5 A 6 23 0 Q Yes . D u r i n g t h e t i m e t h a t y o u w e r e in G u i n n e s s & Mahon 7 w a s t h e p h r a s e s u i t a b l y s e c u r e d i n t h e u s e t h a t it 8 subsequently became? 9 phrase 10 A s u i t a b l y s e c u r e d as a p p l i e d t o a l o a n ? I n e v e r h e a r d t h e p h r a s e u n t i l s o m e b o d y w r o t e to m e recently. 11 12 W ere you familiar w i t h the 23 1 Q 13 I see. The e v i dence we have b e e n g iven on oath by the current m a n a g e m e n t of Gu i n n e s s 14 A 15 232 Q 16 A 17 23 3 Q & Mahon? Yes . On b e h a l f of them? Yes . Is t h a t t h a t p h r a s e w a s u s e d to d e s c r i b e a l o a n t h a t 18 was s e c u r e d b y a d eposit w i t h an o f f - s h o r e 19 s u b s i d i a r y of Gui nn e s s 20 off-shore subsidiary? 21 A 22 234 Q & Mahon. T h a t c o u l d b e an Yes . However, w h e n t h e y d i d n o t w i s h t h e f a c t of t h e r e a l 23 s e c u r i t y to a p p e a r on the d o c u m e n t s t h e y u s e d the 24 phrase 25 A 26 23 5 Q s u i t a b l y secu r e d n o r m a l l y in i n v e r t e d commas? Yes . C a n I a s k y o u to l o o k at p a g e 33, please 27 Handed) ( E x h i b i t 12). 28 of it. T h i s is an i n t e r n a l G u i n n e s s 29 d o c u m e n t in r e l a t i o n to a l o a n w h i c h , 38 (Same Just the first page actually & Mahon or tw o - ­ 1 t h r e e l o a n s -- o r f o u r l o a n s in f a c t t h a t y o u h a d 2 r e c e i v e d in o r a r o u n d 1 9 7 8 3 within. 4 two special account"? 5 A. 6 2 3 6 Q. 7 I think; from the dates If y o u l o o k at t h e v e r y f i n a l o n e " N u m b e r Y o u s e e t h a t at t h e b o t t o m ? Yes. Y o u se e a l o a n a n d a f i g u r e a n d t h e n i n b r a c k e t s or i n i n v e r t e d c o m m a s t h e p h r a s e s u i t a b l y s e c u r e d ? 8 A. 9 237 Q. Yes. O n t h e f a c e o f it, and a c c o r d i n g to the 10 evidence given by Guinness 11 w o u l d i n d i c a t e that that was s e c u r e d on a d e posit 12 that yo u or s o m e b o d y b e l o n g i n g to yo u h a d w i t h an 13 off-shore subsidiary with Guinness 14 o n l y co n c e r n a nd the o nly r e a s o n we are a s k i n g you 15 a b o u t it at a l l is to s e e w h e t h e r t h a t d e p o s i t w a s 16 with 17 s u b s i d i a r y in the C h a n n e l 18 s u b s e q u e n t l y at a l a t e r d a t e a l i n k b e t w e e n d e p o s i t s 19 in the Channel 20 I h a v e to a s k you: 21 with 22 A. No, 23 238 Q. No? 24 A. No. 25 2 3 9 Q. No. So, is m y a n s w e r t o that. D i d y o u t h e n h a v e a d e p o s i t o r a t r u s t in t h e Islands managed by College Trustees because C a n y o u t e l l me: Yes? Islands b e c a u s e there was "Ansbacher" Cayman or a trust? there will be a link? 24 0 Q. Our Di d yo u in fact h a v e a d e p o s i t 27 29 & Mahon. Islands and deposits in Cayman. Channel A. that " A n s b a c h e r " C a y m a n o r i f it w a s w i t h t h e 26 28 & M a h o n t o us, College T r u s t e e s ...(I N T E R J EC T IO N ). 1 A. t r u s t e e c o m p a n y we h a d in Dublin. 2 3 24 1 Q. 4 A. 5 6 T h e n a m e is f a m i l i a r a n d I t h o u g h t t h a t it w a s t h e No? T h a t w a s so n a m e d a f t e r C o l l e g e G r e e n b u t it w a s in the Ch a n n e l 242 Q. Islands. It w a s in t h e C h a n n e l Islands. 7 Mr. 8 even ask you about a Channel 9 A. 10 24 3 Q. Forwood, Actually, I will just e x p l a i n to you w h y I w o u l d Islands situation? Yes. W h a t w e h a v e l e a r n e d is t h a t Irish residents 11 d e p o s i t e d m o n e y or f ormed t rusts in the C h annel 12 Islands? 13 A. 14 244 Q. 15 A. 16 24 5 Q. Yes. W h i c h w a s p e r f e c t l y l e g i t i m a t e at t h e t i m e ? Yes. A n d C o l l e g e T r u s t e e s was the m a n a g e r of the 17 Guinness 18 trust Companies. 19 A. 20 2 4 6 Q. & M a h o n s ub s i d i a r i e s out t here a nd of the The y m a n a g e d the trust funds? Yes. A n d u p to a b o u t 1981 t hey d e p o s i t e d t hose trust f u n d s n o r m a l l y in b a n k s i n t h e C h a n n e l 21 22 A. 23 247 Q. Islands? Yes. However, b e t w e e n 1 9 8 1 a n d 1 9 8 9 it a p p e a r s t h a t 24 C o l l e g e T r u s t e e s o f t e n u n k n o w n to i t s o w n c l i e n t s 25 d e p o s i t e d t h e i r f unds, 26 "Ansbacher" Cayman? 27 A. 28 248 Q. 29 t h e I r i s h fu nds , with Right. As a result of w h i c h m a n y p e o p l e who were really 1 2 3 2 4 9 Q. 4 A. 5 25 0 Q. 6 A. 7 25 1 Q. 8 A. 9 O f t e n u n k n o w n to t h e m s e l v e s ? Well, I me a n that I didn't know but I h a d a trust. Yes? In the C h a n n e l Islands. Yes? I thought the trustee was called Guinness Mahon G u e r n s e y Trust. 10 252 Q. 11 A. 12 25 3 Q. That w o u l d be right, yes. C o l l e g e ...(IN T ER JECTION)? D i d it c h a n g e it s n a m e ? No, it d i d not. However, College Trustees 13 ef f ectively m a n a g e d the funds 14 Guernsey Trust? 15 A. 16 Yes. What fo r G u i n n e s s M a h o n I w o u l d l i k e to d o is t a k e a c o u p l e of m i n u t e s to tell yo u a bout this J e r s e y Trust. 17 254 Q. 18 A. Certainly, yes? I w i l l b e as b r i e f as I can. My father-in-law died 19 in J a n u a r y 1961 a n d left his E s t a t e on v e r y loose 20 Discret i o n a r y Trusts but the intention evidently 21 was that the b e n e f i c i a r i e s 22 children. 23 25 5 Q. 24 A. 25 2 5 6 Q. 26 A. 27 28 29 Yes? M y w if e , her sister and her brother. Yes? After payment left except 257 Q. s h o u l d be his three Yes? of E s t a t e D u t y t h e r e w a s n ' t a lot for a f a r m in B u c k i n g h a m s h i r e . 1 her brother and her sister and indeed her mother 2 w h o was still alive. 3 258 Q 4 A Yes ? A n d a p r o p o s i t i o n was put i n v o l v i n g the pay m e n t 5 o u t of, 6 m o n e y but the a p p o i n t m e n t out of this asset, 7 m y w i f e an d m y s e l f for some reason, 8 t h a t w e s h o u l d t h e n i m m e d i a t e l y r e a p p o i n t or 9 re - s e t t l e on va r i o u s J e r s e y Trusts we l l , it w a s n ' t p a y m e n t b e c a u s e it w a s n ' t in f a c t on c o n d i t i o n for the be n e f it 10 o f t h e t h r e e o f t h em. 11 a c opy I t h i n k of a letter w h i c h I the n wrote 12 giving nine good reasons why this 13 b u t at t h e e n d of t h e d a y f o r t h e s a k e of f a m i l y 14 r e l a t i o n s h i p s we a g r e e d a nd this was done and m y 15 wife — 16 259 Q 17 A 18 26 0 Q 19 A I d e murred and I still have should not happen Yes ? There was a company called A r m a g h Holdings Limited. Yes ? A n d it i s s u e d s h a r e s a n d m y w i f e h a d a t h i r d of t h e s e shares. 20 21 26 1 Q 22 A Yes? A n d t h e y were s e t t l e d on a Channel Islands trust 23 and the t r u stees w o u l d have b e e n Guinn e s s Mahon 24 J e r s e y a n d I r e a d i l y b e l i e v e it b e c a m e C o l l e g e 25 Trustees. 26 n e g l i g i b l e income. 27 262 Q 28 A 29 Now, that asset was valuable but pro d u c e d Yes? A n d I h a v e an i d e a t h a t I may well have myself at t h a t t i m e a d d e d o t h e r a s s e t s ; in p a r t i c u l a r 1 u n d i v i d e d s h a r e s in a n o t h e r f a r m i n B u c k i n g h a m s h i r e 2 w h i c h p r o d u c e d n e g l i g i b l e income. 3 26 3 Q 4 A 5 264 Q 6 A 7 26 5 Q Yes . A n d t h a t so r e m a i n e d u n t i l w e c a m e o v e r her e. Yes ? W h i c h w a s i n 1993. Yes. So, is t h e t r u s t s t i l l in e x i s t e n c e o r w a s it w o u n d u p in 1 9 9 3 ? 8 9 A 10 2 66 Q 11 A It w a s w o u n d up. Yes ? I m e a n this has b e e n a source of m u c h fa m i l y trouble a n d gr i e f . 12 13 267 Q 14 A 15 Yes. I d o n o t w a n t t o m a k e y o u r e l i v e a n y of t h a t ? B u t I t h i n k t h e w h o l e t h i n g is g o i n g t o b e s o l v e d q u i t e soon. 16 268 Q 17 A 18 269 Q Right. Really. A f t e r 40 y e a r s . My heavens. T h a n k you for that explanation. Really 19 w h a t I a m a n x i o u s t o a s c e r t a i n is: 20 l o o k i n g at t h e d o c u m e n t s 21 g a v e y o u t h a t t h e r e f e r e n c e to " s u i t a b l y s e c u r e d " 22 t h e r e is to t h e m o n e y t h a t y o u h a d i n f a c t at t h e 23 time in the Channel 24 A 25 27 0 Q 26 A 27 27 1 Q 28 A 29 272 Q Do y o u t h i n k n o w ( E x h i b i t 12) that I just Islands? No. You do not? I don't. T h e n w h a t do y o u t h i n k it m i g h t r e f e r t o ? Well, Yes? just ju m p i n g a head for a second. 1 You have been talking about a company called York 2 Securities. 3 27 3 Q 4 A 5 274 Q 6 A Yes, I w a s g o i n g to c o m e to t h a t ? I k n o w y o u are. Right? But I have a c tually written, y o u know, having 7 b e e n r e m i n d e d w h a t Y o r k S e c u r i t i e s was, 8 was c o m p l e t e l y b a r k i n g up the w r o n g t r e e on 9 t h a t one. 10 27 5 Q 11 A Yes? I have written a little note which I shall read you in due course. 12 13 276 Q 14 A Fine? In w h i c h I g i v e m y t h e o r y as to w h a t t h a t m e a n s (indicating). 15 16 Fi ne. I 277 Q 17 Perhaps, y o u w o u l d l i k e t o do t h a t n o w a n d w e c a n g e t o n to Y o r k S e c u r i t i e s ? 18 A 19 278 Q 20 A C a n I? Yes, that w o u l d be fine? I j u s t w o n d e r a l l t h e s a m e w h e t h e r t h i s is g o i n g t o t h r o w ou t y o u r l i n e o f q u e s t i o n i n g . 21 22 279 Q 23 A 24 28 0 Q It w i l l n o t ? B e c a u s e t h e r e is q u i t e a b i t o f th i s . It w i l l not, Mr. Forwood, because I a c t u a l l y wanted, 25 a l l I w a n t e d t o k n o w at t h a t p o i n t , 26 h a d a C a y m a n t r u s t t h a t w a s b a c k i n g y o u r o w n loan. 27 You tell me you had not? 28 29 A was whether you No. You explained about the Channel 44 Islands ones and you 1 n o w t h i n k that y our e x p l a n a t i o n for Y o r k S e c ur i t i e s 2 m a y explain the 3 ( E x h i b i t 12) 4 Yes . 5 282 Q 6 A 7 28 3 Q 8 A 9 So, "suitably secured" here reference (indicating)? if it f i t s i n f i n e ? Yes. So, Please, Again, shall I. yes? I t h i n k I m u s t go back. W h e n I c a m e to I r e l a n d I s a w a d v e r t i s e d a h o u s e w h i c h I f e l l in 10 l o v e w i th . 11 w i t h 2 6 0 a c r e s o f land. 12 284 Q 13 A It w a s a b i g r a t h e r d i l a p i d a t e d h o u s e Yes ? A n d I a g r e e d to b u y it a n d t h e n d i s c o v e r e d t h a t 14 t h e L a n d C o m m i s s i o n had, 15 t o do, 16 C o m m i s s i o n a n d said, 17 d i l a p i d a t e d h o u s e , " a n d t h e y said, 18 " If I t a k e t h e h o u s e h o w m u c h l a n d w i l l y o u a l l o w m e 19 t o k e e p , " a n d e v e n t u a l l y it c a m e d o w n t o 100 a c r e s 20 w hich was largely rough woodland. 21 28 5 Q 22 A as t h e y w e r e t h e n e n t i t l e d s a i d t h e y w a n t e d it. I w e n t t o se e t h e L a n d "Do y o u r e a l l y w a n t t h i s " N o , " a n d I said, Yes? I h a d t o b u y t h e w h o l e t h i n g a n d t h e n s e l l t h e m fo r 23 £ 1 5 0 a n a c r e 150 a c r e s . 24 to reco v e r what 25 m a d e a d e l i g h t f u l whole. 26 s u p p o s e d to d i s t r i b u t e this l a n d a m o n g l o c a l fa r m e r s 27 w ho h adn't got e n ou g h land for a v i a b l e h o l d i n g but 28 they didn't. 29 land to the W i c k l o w C o u n t y Council and t h e y didn't It w a s a l w a y s m y a m b i t i o n I h a d b e e n d e p r i v e d o f b e c a u s e it The L an d C o m m i s s i o n was W h e n they were d i s b a n d e d t h e y sold the 1 2 286 Q 3 A Yes ? A t a c e r t a i n st a g e , w h i c h c o u l d h a v e b e e n 1974, 4 150 a c r e s w h i c h w a s j u s t o v e r t h e w a l l c a m e u p f o r 5 sale and I thought 6 t h e n g o to L a n d C o m m i s s i o n , 7 it w a s t h e W i c k l o w C o u n t y C o u n c i l , 8 a swap b e c a u s e the land I was h o p i n g to acquire was 9 b e t t e r land. 10 287 Q 11 A if I c o u l d a c q u i r e t h i s I could I think by this stage and offer them Right? Now, b e f o r e t h e a u c t i o n a f e l l o w c a m e t o se e t h e 12 B a n k l o o k i n g for a loan a nd he e x p l a i n e d that 13 he w a n t e d t o b i d f o r t h i s l a n d w h i c h w a s v e r y 14 e m b a r r a s s i n g for me b e c a u s e h a d I s i m p l y t u r n e d h i m 15 d o w n he w o u l d h a v e s a i d o r m i g h t h a v e said, 16 s u r e he w o u l d h a v e said, 17 t r y i n g to e l i m i n a t e a c o m p e t i t o r . 18 288 Q 19 A I am t h a t it w a s b e c a u s e I was Yes ? So, I s a i d I w o u l d see h i m a n d I said, " W h y do y o u 20 w a n t t h i s l a n d , " a n d he s a i d h e h a d r e a s o n to 21 s u p p o s e t h a t he c o u l d g e t p l a n n i n g p e r m i s s i o n on 22 a c o r n e r o f it t o b u i l d l i t t l e h o u s e s . 23 " A l l r i g h t t h e n. 24 want 25 289 Q 26 A 27 29 0 Q 28 A 29 29 1 Q So, W h y don't we b i d to g e t h e r ? 15 a c r e s a n d I s h a l l h a v e t h e r e s t " . Yes ? "And yo u p a y a t e n t h of the price". Yes? T h a t is w h a t h a p p e n e d . I said, You 1 2 292 Q 3 A 4 29 3 Q 5 A Yes ? Of w h o m I h a d n ' t p r e v i o u s l y heard, you see? Yes ? Some years later I think I was a p p r o a c h e d again 6 by N u l t y who said that the pla n n i n g permission 7 w o u l d b e e a s i e r to o b t a i n i f p a r t o f m y l a n d w e r e 8 i n c o r p o r a t e d in it a n d at t h a t t i m e p r o b a b l y he 9 i n t r o d u c e d m e to two p e o p l e c a l l e d Rhat i g a n . 10 294 Q 11 A 12 29 5 Q 13 A 14 Yes ? A n t h o n y and Brian Rhatigan. Yes ? A n d in r e t r o s p e c t I think Nulty's, y o u k n o w -- h i s j o b m a y h a v e b e e n to f i n d d e v e l o p a b l e l a n d f o r t he m . 15 296 Q Yes? 16 A Now, I said, "All righ t . " It s e e m e d , y o u know, 17 l i k e l y to be a p r o f i t a b l e a r r a n g e m e n t a n d a 18 company was 19 shelf company. 20 297 Q 21 A f o r m e d a n d I t h i n k it w a s a Yes? W h i c h is w h y t h e n a m e m e a n t n o t h i n g t o me. I a l w a y s t a l k e d a b o u t K i l q u a d e w h e r e t h e l a n d was. 22 23 298 Q 24 A 25 Yes ? And I fancy I conveyed my land and they conveyed t h e i r b i t o f land. 26 299 Q 27 A 28 30 0 Q 29 A Yes? To t h i s c o m p a n y . Yes? 1 30 1 Q 2 A 3 And because I h a d m o r e l a n d t h a n t h e y had; I h a d s l i g h t l y m o r e t h a n a third. 4 302 Q 5 A Yes ? Now, the pl a n n i n g permi s s i o n was obtained. already have been obtained. 6 7 30 3 Q 8 A 9 It m a y A n y w a y it w a s t h e r e . Yes? A n d it w a s f o r q u i t e a l a r g e n u m b e r of h o u s e s . I can't remember how many but I w o u l d s a y at l e a s t fi fty . 10 11 304 Q 12 A 13 Yes ? A n d the idea was to put in w h a t t h e y c a l l e d infrastructure. 14 30 5 Q 15 A 16 306 Q 17 A 18 307 Q 19 A Yes? A n d then sell individual sites. Yes ? A n d m o n e y was b o r r o w e d by the company. From Guinness Well, & Mahon? I have got here (indicating) an e x tract the Company's register. 20 21 308 Q 22 A 23 Yes? A n d it's evident that m o n e y was b o r r o w e d from Guinness 24 309 Q 25 A & Mahon. Yes ? I don't know w h e t h e r you have seen this (indicating)? 26 27 31 0 Q 28 A 29 31 1 Q I t h i n k we have? You have? Yes? from 1 I am a bit p u z z l e d about some of these but there 2 is o n e i n 1 9 7 8 w h i c h c o u l d b e r i g h t ; 3 from Northern Bank Finance Corporation. 4 312 Q 5 A 6 31 3 Q 7 A Yes ? P a i d o f f i n 1982. Yes? A n d t h e n t h e r e is a n o t h e r one; again, Northern Bank Finance Corporation. 8 9 money borrowed 314 Q In a n y e v e n t w e n e e d n o t c o n c e r n o u r s e l v e s w i t h those? 10 11 A 12 31 5 Q 13 Sorry? We need not concern ourselves with the various loans ? 14 A 15 316 Q 16 A Yes . 17 317 Q Yes . 18 A 19 318 Q 20 A Right. In a n y e v e n t m o n e y w a s b o r r o w e d ? It s a y s h e r e 1st O c t o b e r 1987. Yes. Now, Yes ? if I c o u l d j u s t r e a d f r o m m y n o t e at t h i s stage? 21 22 319 Q 23 A Yes? M o n e y was n e e d e d to c o m p l e t e i n f r a s t r u c t u r e 24 a n d it is e v i d e n t t h a t it w a s b o r r o w e d f r o m 25 Guinness 26 32 0 Q 27 A 28 29 & Mahon. Yes? The s e c u r i t y I am quite sure was the p a r t i a l l y developed land backed by personal guarantees. 32 1 Q Yes? 1 I think I remember refusing a joint and several 2 guarantee. 3 322 Q 4 A 5 Yes ? So t h a t m i n e w a s c o n f i n e d to m y a p p r o p r i a t e proportion. 6 32 3 Q 7 A Yes? This in turn was sup p o r t e d I suspect b y an e q u itable 8 m o r t g a g e b y d e p o s i t of t i t l e d e e d s of m y h o u s e a n d 9 l a n d at W o o d s t o c k . 10 324 Q 11 A 12 32 5 Q 13 A 14 326 Q 15 A Yes ? Worth many times my potential liability. Yes ? No other security could p o s sibly have been required. Yes? The I n s p e c to r s s e e m to b e l i e v e t h a t t h e e x p r e s s i o n 16 s u i t a b l y s e c u r e d is s o m e k i n d o f c o d e d e n o t i n g 17 b a c k i n g for a s ource ou t s i de the Country. 18 327 Q 19 A Yes ? I d o n ' t b e l i e v e this , s o r r y I h a v e t o say, and have a n other theory. 20 21 328 Q 22 A Yes? J D . T r a y n o r h a d m a n y q u a l i t i e s b u t he w a s 23 (a) 24 if he w a s p e r s o n a l l y s a t i s f i e d t h a t a l o a n w a s 25 a d e q u a t e l y s e c u r e d he w o u l d h a v e i s s u e d an edict 26 accordingly. 27 329 Q 28 A 29 secretive, and (b) d i c t a t o r i a l . I t hink that Yes? A n d t h i s m a y h a v e b e e n e x p r e s s e d as s u i t a b l y secured. 1 33 0 Q 2 A 3 W h a t a r r a n g e m e n t s the R h a t i g a n ' s m a y have m a d e p r o b a b l y did not 4 33 1 Q 5 A I k n o w a n d c e r t a i n l y d o n o t k n o w now. Yes ? So, the d e v e l o p m e n t f r o m m y p o i n t of v i e w w a s 6 not a success. 7 R h a t i g a n and I were bought out b y B r i a n R h a t i g a n 8 ye s . 9 A 10 332 Q 11 A The end of the s tory was that Tony I t hink for a p o u n d a piece. Yes ? He, Brian, h o w e v e r m a d e a r r a n g e m e n t s t o r e l e a s e us 12 from our potential 13 m y b i t o f l a n d a n d p r o b a b l y s o m e m o n e y as w e l l. 14 33 3 Q Yes. 15 A Now, 16 334 Q 17 Mr. liabilities. I s i m p l y lost Forwood? t h a t is t h e Y o r k S e c u r i t i e s Thank you ve r y much. st o r y . Can I show you some documents r e l a t i n g to Y o r k S e c u r i t i e s ? 18 A 19 33 5 Q Yes . A n d m a y b e w e c a n w o r k o u t w h a t is m e a n t b y t h e s e 20 documents. 21 ( E x h i b i t 13). 22 d o c u m e n t a n d it is r e l a t e d as y o u c a n s e e t o t h r e e 23 l o a n s g i v e n to Y o r k S e c u r i t i e s ? 24 A 25 336 Q please? 27 A 28 337 Q (Same H a n d e d ) T h i s is a n i n t e r n a l G u i n n e s s & Mahon Yes . Y o u se e w h a t it s a y s i n r e l a t i o n t o N u m b e r t h r e e loan? 26 29 P a g e 4 6 , Ma r y , Backers Yes, 2 a n d 3. yes. U n d e r N u m b e r three: "We c o n s i d e r t h i s s e c u r i t y t o b e a d e q u a t e i n al l c a s e s . " 1 2 3 4 338 Q. A n d then: 5 "This loan is cash backed"? 6 7 A. 8 339 Q. 9 A. 10 340 Q. 11 A. 12 341 Q. 13 A. 14 342 Q. You do not believe? 15 A. The cash was there. 16 343 Q. 17 A. I don't think it was in m y case. Yes? But I can give you two reasons. Yes? For t h i nking that it was not. Yes? One is that I don't believe the cash was there. Yes? Because this Jersey trust h ad valuable assets but they weren't cash. 18 19 344 Q. 20 A. 21 Yes? A n d the other is that m y wife and I were discre t i o n a r y b e neficiaries under this trust. 22 345 Q. 23 A. Yes? Together with our children and p o s s i b l y charities; I don't know. 24 25 346 Q. 26 A. 27 347 Q. 28 A. 29 Well, Yes? It would have been p o ssible for the trustee. Yes? To exercise his discretion and pay, you know, hand over, the assets to us. 1 348 Q 2 A 3 349 Q 4 A 5 35 0 Q 6 A 7 35 1 Q 8 A 9 352 Q 10 A 11 35 3 Q W h i c h is w h a t e v e n t u a l l y h a p p e n e d . Yes ? B u t t h e t r u s t e e w o u l d not. Yes ? H a v e the d i s c r e t i o n or aut h o r i t y . Yes? To u s e h i s a s s e t s . Yes ? To b a c k a b o r r o w i n g . I u n d e r s t a n d t h at . Can I show you another page? 12 It is p a g e 49, 13 This 14 M a h o n t o t h e C e n t r a l B a n k o f I r e l a n d a n d t h i s is a n 15 A p p e n d i x to t h a t r e p o r t a n d it is d e s c r i b e d as 16 "loans 17 that? 18 A 19 354 Q is a n e x t r a c t (Same H a n d e d ) ( E x h i b i t 14) from a report made by Guinness set o f f a g a i n s t d e p o s i t a c c o u n t s . " & Do y o u s e e Yes . A n d u n d e r I r i s h p o u n d l o a n s w e h av e , three, 20 please. four, five, one, two, s i x d o w n y o u see: 21 "Rockford Investments/York Securities." 22 23 24 Do y o u se e t h a t ? A Yes . 25 T h a t is u n d e r t h e h e a d i n g o f l o a n s 26 deposit accounts. 27 York Securities, 28 a n y ev e n t , 29 me a n y e x p l a n a t i o n for t h at? So, se t o f f a g a i n s t a g a i n w e h a v e a r e f e r e n c e to in t h e m i n d o f G u i n n e s s & M a h o n in being backed by cash but you cannot give 1 2 356 Q 3 A 4 357 Q 5 A 6 358 Q 7 A Yes . A familiar name? I m e a n I h a d f o r g o t t e n t h e na m e . I w a s g o i n g to a s k y o u a b o u t t h a t as w e l l ? B u t t h a t w a s it. That could not have been done with m y authority. 8 9 359 Q 10 A What was R o ckford Investments, Well, 12 36 0 Q 13 A 14 36 1 Q 15 Islands. That was the n ame of your trust? Yes, I t h i n k so. I see, I see. So, that does seem to i n d icate that it w a s l i n k e d t h e n w i t h Y o r k ; 16 A 17 362 Q 18 A 19 36 3 Q 20 A 21 364 Q Forwood? I f a n c y it w a s t h e n a m e g i v e n t o t h i s t r u s t in the C h a n n e l 11 Mr. d o e s it n o t ? It d o e s . In r e l a t i o n to c a s h ? It d o e s . Yes. However, not with your authority? No. I see. It h a s b e e n o u r e x p e r i e n c e i n i n v e s t i g a t i n g 22 t h i s w h o l e b u s i n e s s t h a t in m a n y c a s e s w h e r e a l o a n 23 p r o v e s to h a v e b e e n b a c k e d b y a d e p o s i t a b r o a d the 24 p e r s o n w h o s e d e p o s i t it w a s w a s u n a w a r e of i t? 25 A 26 36 5 Q Yes . It s e e m s t o b e s o m e t h i n g t h a t G u i n n e s s 27 without consultation. 28 as c o m f o r t ? 29 A & Mahon did T h e y s e e m e d t o h a v e u s e d it 1 3 66 Q 2 A 3 367 Q 4 A 5 368 Q 6 A 7 369 Q I f e a r so. Yes ? I m e a n I w o u l d have been furious. Yes ? B e c a u s e it w a s n ' t n e c e s s a r y a n y way. I understand. 8 Mr. Forwood, 9 (Exhibit 15)? C a n I s h o w y o u s o m e t h i n g e l s e now, a n d it is p a g e 48 (Same H a n d e d ) T h i s is a l e t t e r h e a d e d " A n s b a c h e r " . Do y o u se e t h a t ? 10 11 A 12 37 0 Q Yes . It is s i g n e d b y J o a n W i l l i a m s w h o w a s Mr. Traynor's secretary? 13 14 A 15 37 1 Q 16 A 17 372 Q Yes, I remember. I d o n o t k n o w if y o u e v e r k n e w Ms. W i l l i a m s ? I r e m e m b e r h e r w el l . Yes. T h i s w a s a f t e r Mr. T r a y n o r 's m o v e t o t h e 18 o f f i c e s o f C R H i n F i t z w i l l i a m S q u a r e a n d he is 19 wr i t i n g from that address, 20 to Irish I n t e r c o n t i n e n t a l Ban k where 21 h a d a n a c c o u n t at t h a t t i m e . 22 their accounts 23 A 24 37 3 Q or Joan W i l l i a m s from Guinness "Ansbacher" They had moved & M a h o n in 1991? Yes . Y o u se e t h i s l e t t e r : 25 26 27 28 29 30 is, " D e a r P e t e r , f u r t h e r t o m y l e t t e r of y e s t e r d a y ' s d a t e the D raft for the s t e r l i n g e q u i v a l e n t of I r .£25,000 requested therein should be payable to Yor k S ecurities Limited. Apologies for the o m ission." 1 2 W h a t J o a n W i l l i a m s a p p e a r s to b e s a y i n g t h e r e is 3 that 4 from their account 5 account, p a y a b l e to Y o r k S e c u r i t i e s . 6 h a v e is "Ansbacher" paying York Securities 7 It a p p e a r s as if Y o r k S e c u r i t i e s h a d s o m e r i g h t 8 to d r a w funds 9 A 10 374 Q 11 A i n IIB, f r o m " A n s b a c h e r 's " from "Ansbacher" So, w h a t we funds. in 1991? C o u l d I l ook for a little i n f o r m a t i o n f rom you? Certainly? Because I t h i n k you are m u c h b e t t e r i n f o r m e d t h a n I am. 12 13 37 5 Q 14 A 15 376 Q 16 A 17 18 " A nsbacher" has a s k ed for a d raft to come Yes? I fancy that I was a D i r e c t o r of Yor k Securities. Yes? Do y o u k n o w w h e n I c e a s e d to b e a D i r e c t o r of Y o r k Securities ? 377 Q I d o n o t know. No, I do n o t know that. I h a v e an 19 i d e a it w a s a r o u n d t h e t i m e y o u l e f t I r e l a n d b u t 20 am not certain? 21 A t h e r e is s o m e t h i n g v e r y o d d a b o u t t h i s l i s t of c h a r g e s . 22 23 378 Q 24 A 25 379 Q 26 A 27 38 0 Q 28 A 29 Well, Right? T h e r e is o n e h e r e (indicating) t h e 3 r d M a y 1990. Yes ? A n d it is to A I B F i n a n c e L i m i t e d . Yes? I " A l l tha t, t h e p r o p e r t y k n o w n as U n i t 8 a n d 2 a c r e s at D u n l e e r I n d u s t r i a l E s t a t e , D r o g h e d a , C o u n t y Lo ut h, c o m p r i s e d in f o l i o . . . " 1 2 3 4 S u c h a n d such. 5 38 1 Q. 6 A. 7 382 Q. 8 A. 9 38 3 Q. 10 A. 11 384 Q. 12 A. 13 38 5 Q. 14 A. 15 3 8 6 Q. 16 A. 17 387 Q. 18 19 A. 20 388 Q. Now, I h a v e n e v e r h e a r d of tha t. Yes? A n d I t h i n k that m u s t h a v e b e e n after. A fter you left? I m e a n there was never anything. Yes? But Kilquade. Yes? So t h a t I t h i n k I w a s gone. A n d that was what year? M a y 1990. 1990? I m u s t h a v e b e e n g o n e then . C a n y o u f i n d out, Mr. York Securities? Can you find that out for us? Well, Forwood, when you left does the company register retain such details. It s h o u l d , yes. Yes, you sh o u l d be able to check it t h e r e ? 21 22 A. 23 3 8 9 Q. 24 A. 25 39 0 Q. 26 A. 27 39 1 Q. 28 A. 29 392 Q. Because, y o u know, We w i l l check. I a s k e d f o r it. Y o u d i d n o t g e t it; No. W e s h o u l d b e a b l e to c h e c k t h a t ? C o u l d you? W e s h o u l d b e a b l e to? I m e a n I really w ould be grateful. Yes. Yes? did you not? 1 2 39 3 Q 3 A 4 394 Q 5 Can you check? A n d t h e r e is a n o t h e r one, However, Mr. 6 A 7 39 5 Q you see? just l e a v i n g that a side for a moment, Forwood? Yes . C an you t h i n k of any reason, g e t t i n g b a c k to the 8 letter I just showed you 9 w hy York Securities w ould be getting a payment, 11 A 12 396 Q 13 A Yes . C an you t h i n k of a ny r e a s o n w h y Y o r k S e c u r i t i es N o n e w h a t s o e v e r b u t I s u s p e c t t h a t it w a s n ' t in m y t i me . 16 Y o u s e e t h e r e is a n o t h e r o n e h e r e (indicating). 17 397 Q 18 A 19 398 Q 20 A 21 3 99 Q Yes? 22 A Now, 23 Yes ? A b o r r owing from A IB Finance Limited. Yes? 3 r d J a n u a r y 1991. I know nothing whatsoever about a borrowing from AIB Finance Limited. 24 400 Q 25 A 26 Yes, yes? Y o u se e at t h a t t i m e t h e b o r r o w i n g f r o m G u i n n e s s & M a h o n h ad not b e e n repaid. 401 Q Yes, yes. C a n I s a y o n e t h i n g t o you, Mr. Forwood: We h a v e s p o k e n to b o t h B r i a n a n d A n t h o n y R h a t i g a n ? 28 29 just w o u l d be e n t a i l e d to d r a w m o n e y f r o m " A n s b a c h e r " ? 15 27 ( E x h i b i t 15), s u p p o s i n g it w a s w i t h i n y o u r t i m e ? 10 14 (indicating) A Yes . 1 402 Q 2 A 3 403 Q 4 A 5 404 Q Yes . A n d we a sked t h e m q u estions? Yes . A n d w e p u t to B r i a n R h a t i g a n t h i s d r a f t i n 1 991 (Exhibit 15)? 6 7 A 8 405 Q 9 A 10 406 Q Yes . A n d t h i s p a y m e n t o u t of " A n s b a c h e r " ? Yes . A n d w e a s k e d h i m i f he c o u l d e x p l a i n it a n d he 11 said, 12 b e c a u s e Mr. 13 That was his evidence. 14 t h i n k t h e n Mr. 15 "He w a s t h e p e r s o n w i t h t h e m o n e y . 16 money. 17 I p u t t h a t to y o u as t h e e v i d e n c e w e h a v e t o d a t e 18 a n d t h a t is t h e r e a s o n I a m a s k i n g y o u a b o u t it? 19 A 20 407 Q 21 A "No, but that this was not s urprising Forwood financed York Securities". W e t h e n said, "Well, do y o u F o r w o o d o r g a n i s e d t h i s , " a n d h e said, We didn't have He w a s t h e f i n a n c i e r a n d t h e b a n k e r . " So, A l l ri g h t . I am b e i n g t o t a l l y honest w i t h you? Well, I certainly can say I'm speechless. I mean I am not a p r o p e r t y d e v e l o p e r b y trade. 22 23 408 Q 24 A 25 409 Q 26 A 27 Yes ? I have e x p l a i n e d h o w I got i n v o l v e d in this affair. Yes ? I w a s d e s p e r a t e l y i n t e r e s t e d in t h e s a l e o f s i t e s a n d c e l e b r a t e d e v e r y t i m e o n e w a s sold. 28 410 Q 29 A Yes? 1 411 Q 2 A A n d I was not a rich man and I w ould have thought 3 that the Rhatigan brothers, 4 t o b e ... 5 412 Q 6 A 7 413 Q well they appeared T h e y a p p e a r e d to be? Substantial. T h e r e m a y b e a s i m p l e e x p l a n a t i o n f o r a l l of this, 8 Mr. Forwood. 9 the beginning; It m a y b e w h a t I s u g g e s t e d t o y o u at that your Channel Islands funds had 10 in fact b e e n l o d g e d in " A n s b a c h e r " b y C o l l e g e 11 Trustees because now that you told me that Rockford 12 is i n f a c t y o u r C h a n n e l 13 A 14 414 Q Yes . I a m g o i n g to s h o w y o u s o m e d o c u m e n t s l i n k i n g Rockford with 15 16 A 17 415 Q 18 A 19 416 Q Islands Company? "Ansbacher"? Yes . So, it w o u l d a p p e a r as i f t h a t m a y h a v e h a p p e n e d ? Yes . So, if I c o u l d s h o w y o u f i r s t o f a l l p a g e 50 20 Handed) 21 first. 22 G u i n n e s s M a h o n C a y m a n Trust h a d in G u i n n e s s 23 in D u b l i n a f t e r the time that C o l l e g e T r u s t e e s b e g a n 24 t o l o d g e m o n e y w i t h i t? 25 26 A (Exhibit 16)? (Same W e w i l l l o o k at t h a t o n e T h a t is a s t a t e m e n t o f t h e a c c o u n t t h a t Yes . A n d the ac c ou n t was entitled: 27 28 29 " Guinness Mahon Cayman Trust/College T r u s t e e s ". & Mahon 1 2 3 4 418 Q. 5 A. Right? A n d I c a n see: 6 7 "Re: Rockford" . 8 9 4 1 9 Q. A n d you see R o c k f o r d there, money. 10 11 A. 12 420 Q. W h a t is it ? yes. T h e r e is a s u m o f £ 2 , 0 0 0 in c r e d i t ? £2,000. So, t h a t a p p e a r s to b e a l o d g e m e n t i n t o R o c k f o r d at 13 that time which was then lodged by College Trustees 14 with 15 a c c o u n t in G u i n n e s s 16 is a l o d g e m e n t 17 t o us e a r l i e r t h a t y o u t r a n s f e r r e d s o m e f u n d s 18 t i m e t o t i m e o r a s s e t s to t h e t r u s t y o u r s e l f ? 19 A. 20 421 Q. "Ansbacher" a n d it t u r n s u p i n " A n s b a c h e r 's " & M a h o n in D u b l i n . i n J a n u a r y 1987. Now, So, this you mentioned Yes. C o u l d y o u h a v e d o n e so i n 1 9 8 7 ? W o u l d that ring any bell w i t h you? 21 from 22 A. No. 23 422 Q. No? 24 A. 25 423 Q. 26 A. 27 424 Q. C o u l d I? I d o n ' t t h i n k so. Y o u d o n o t t h i n k so? No. B e c a u s e t h i s is c e r t a i n l y a l o d g e m e n t . This 28 is s o m e t h i n g f o r t h e b e n e f i t o f R o c k f o r d h e r e 29 (indicating) from what appears (Exhibit 16)? 1 2 425 Q 3 Could anyone else be dealing with Rockford's affairs other than yourself? 4 A 5 426 Q 6 A 7 I mean Rockford. Yes ? W a s a d m i n i s t e r e d by, w el l , I n o w know, College Trustees. 8 427 Q 9 A 10 428 Q 11 A 12 429 Q 13 Yes? A n d p r e s u m a b l y I k n e w then . Yes. However, m a y be you did not? B u t it w a s a C h a n n e l Yes, yes. However, Islands set-up. as I e x p l a i n e d t o y o u College Trustees. 14 A 15 430 Q 16 A 17 431 Q 18 A 19 432 Q 20 A 21 433 Q 22 A 23 434 Q 24 A 25 435 Q Yes . Deposited the funds? Yes . Unknown? Yes . Unknown quite frequently? Yes . A n d h e r e is a n o t h e r e x a m p l e o f it? Yes . To t h e c l i e n t ? Yes . I will just show you another R o c k f o r d c onnection 26 a n d t h a t is p a g e 51 a n d 52 27 & 18). 28 ( E x h i b i t 17), 29 Is t h a t p o s s i b l e ? Again, (Same H a n d e d ) ( E x h i b i t 17 is t h a t 51 y o u a r e l o o k i n g at t h e r e Mr. Forwood? 1 436 Q 2 A 3 437 Q 4 A 5 438 Q This one (indicating) (Exhibit 17). Yes ? Okay. It is a l e t t e r f r o m J o a n W i l l i a m s t o I I B l o d g i n g a c h e q u e to " A n s b a c h e r 's " a c c o u n t . 6 7 A 8 439 Q 9 D o y o u se e t h a t ? Yes . A n d t h e c h e q u e is t h e n o v e r l e a f (indicating) (Exhibit 18)? 10 A 11 440 Q 12 A 13 441 Q Yes . A n d y o u s e e w h a t it is? Ye . It is a c h e q u e , a r e v e n u e c h e q u e i n fact, 14 p a y a b l e t o R o c k f o r d a n d it is b e i n g l o d g e d i n t o 15 " A n s b a c h e r 's " a c c o u n t . 16 t h a t w e h a v e c o m e to is p r o b a b l y t h e c o r r e c t one; 17 t h a t C o l l e g e T r u s t e e s h a d in f a c t m o v e d R o c k f o r d ' s 18 funds into 19 A 20 442 Q 21 A 22 443 Q 23 A 24 444 Q 25 A 26 445 Q "Ansbacher" So, I think the conclusion ? Yes . That appears during the p e r i o d w hich th e y did that? Yes . T h a t s e e m s to b e t h e c a s e ? Yes . For all of t h e i r clients? Yes . So t h a t m i g h t e x p l a i n t h e "Ansbacher" connection 27 t o Y o r k S e c u r i t i e s as w e l l . 28 " Ansbacher" b a c k i n g for Yor k S ecurities? 29 A That m a y expl a i n the 1 4 4 6 Q. That m a y be the m e a n i n g of "su i t a b l y secured" in c o n n e c t i o n w i t h Y o r k S e c u r i t i e s ? 2 3 A. 4 447 Q. 5 A. 6 448 Q. 7 A. 8 4 4 9 Q. 9 A. 10 450 Q. 11 A. 12 451 Q. 13 A. 14 But I should have be e n a b s o l u t e l y furious. You would? Apart? As m a n y clients were? Apart f r o m t h e fact. Yes? T h a t t h e a m o u n t a s t o n i s h e s me. Yes? B u t I c a n ' t c h a l l e n g e tha t. Yes? Because although these assets were not income producing. 15 452 Q. 16 A. 17 453 Q. 18 A. 19 454 Q. 20 A. 21 455 Q. 22 A. 23 4 5 6 Q. 24 A. 25 457 Q. 26 A. Yes? There were occasional disposals. Yes? So tha t, y o u know. There w ould have been funds? T here c o u l d h a v e been. Yes? I c a n t h i n k o f one. Yes? W h i c h was Yes. substantial. I think that explains that? I m e a n why should I authorise this 27 (Exhibit 14)? 28 security. 29 458 Q. You did not? (indicating) I h a d g i v e n t h e m m y l a n d s as 1 2 459 Q 3 A 4 4 60 Q 5 A 6 461 Q 7 You did not authorise this? I d o n ' t k n o w h o w m u c h t h e t o t a l b o r r o w i n g was. Yes ? B u t m y s h a r e o f it w a s l i t t l e m o r e t h a n a t h i r d . Yes. I think the way Guinness at it was, 8 A 9 462 Q " H e r e is a c o m p a n y a s k i n g us f o r a l o a n " ? Yes . "We k n o w t h a t o n e o f t h e s h a r e h o l d e r s h a s f u n d s 10 off-shore. 11 have other security"? 12 A 13 463 Q 14 A 15 464 Q 16 A 17 465 Q We take comfort f r o m that. T i t l e D e e d s a n d g u a r a n t e e s a n d so on? Yes . T h a t w a s t h e w a y t h e y o p e r a t e d as f a r as w e c a n s e e ? Yes . A n d so f o r t h e i r o w n b o o k s t h e y w e r e q u i t e s a t i s f i e d t h a t i n t h e h e e l o f t h e h un t , 19 t o sh ov e, A 21 4 66 Q 22 A 23 467 Q 24 We already Yes . 18 20 & Mahon were looking if yo u k n o w p u s h came there was m o n e y off-shore? Yes . A n d t h e c l i e n t d i d n o t k n o w t h i s at a l l ? Right. T h a t a p p e a r s t o b e t h e case . I think that s a t i s f i e s m e as t o w h a t a l l t h i s is a b o u t ? 25 A 26 468 Q 27 A Yes . I t h i n k t h a t is c l e a r ? Yes . 28 T h e r e is j u s t o n e o t h e r q u e s t i o n I w a n t t o a s k you: 29 Do y o u k n o w a n y t h i n g a b o u t a c o m p a n y c a l l e d 1 No. 2 3 470 Q 4 A 5 471 Q 6 A 7 472 Q 8 A 9 473 Q 10 A 11 474 Q That does not ring any bell? No. I d o n o t t h i n k it is a n y t h i n g to d o w i t h y o u ? Northgate Not . Investments: D e f i n i t e l y not. Yes? Marlborough Holdings. Let me just see now? Can you give me any information. It is a c o m p a n y o f w h i c h y o u w e r e a d i r e c t o r 12 but I think you m a y well have been a director 13 p u r e l y b e c a u s e the B oard of Guinness 14 r e p r e s e n t e d on it. 15 with Liam McGonagle; 16 De s T r a y n o r ; 17 c a r r i e d out p r o p e r t y d e v e l o p m e n t in M a r l b o r o u g h 18 S t r e e t in D u b l i n . 19 t h a t yo u w e r e on the b o a r d the r e ? 20 A 21 475 Q 22 A 23 476 Q 24 A 25 477 Q 26 A 27 28 29 & M a h o n was It w a s a c o m p a n y c o n n e c t e d Ken 0 ' Reilly-Hyland; O w e n R y an ; a n d y o u r s e l f a n d it I t h i n k it is q u i t e p o s s i b l e Yes . S o l e l y as a r e s p e c t i v e o f G u i n n e s s & Mahon? Yes . I do not t h i n k we n e e d w o r r y about that? I suspect.. . (INTERJECTION). I t h i n k t h a t is t h e c a s e ? I c a n ' t r e m e m b e r w h e r e M a r l b o r o u g h S t r e e t in D u b l i n is. 478 Q T h e f i n a l q u e s t i o n I w a n t to ask, p a g e 86 (Same H a n d e d ) (Exhibit Mr. 18). Forwood, Mr. is on Forwood, if 1 yo u w o u l d like to keep t h e s e d o c u m e n t s we h a v e m a d e 2 these copies 3 T h a t is a l l ri g h t . 4 479 Q 5 A 6 480 Q 7 for you? Y o u a r e w e l c o m e to t a k e t h e m h o m e if y o u w i s h ? W e l l ... Wh a t e v e r you like yourself. You can leave them h e r e if yo u w a n t ? 8 A 9 481 Q 10 A 11 482 Q I w o u l d l i k e to s a y yes. W h a t e v e r yo u w o u l d like to do? Yes . T h i s is a n i n t e r n a l m e m o (indicating) 12 13 A 14 483 Q 15 from Guinness a g a i n of O c t o b e r 1981 & Mahon (Exhibit 18)? Yes . It is i n r e l a t i o n t o r u l e s t h e y w e r e f o r m u l a t i n g a b o u t w h e n to d i s p o s e o r r e t a i n d o c u m e n t s ? 16 A 17 484 Q Yes . T h e o n l y o n e t h a t n e e d c o n c e r n us is N u m b e r 4 d o w n 18 at t h e b o t t o m ; 19 in b rackets. 20 A 21 485 Q t h e s e c o n d N u m b e r 4. T h e f i n a l i t em . The n u m b e r 4 Do y o u se e t h i s ? Yes . It says: 22 23 24 " F i l i n g at W o o d s t o c k : JAW will talk to W i l l i a m F o r w o o d r e g a r d i n g the filing i n W o o d s t o c k a n d a b o u t t h e r e m o v a l of old files a nd r e p l a c e m e n t of n e w ones." 25 26 27 28 29 Woodstock: W a s t h a t t h e n a m e o f y o u r home, 1 4 8 6 Q. Guinness 2 3 A. 4 487 Q. 5 & M a h o n were a c t u a l l y kept in W o o d s t o c k ? Yes. T h a t is t h e r e f e r e n c e t h e r e A. 7 488 Q. (Exhibit Yes. Wa s t h e r e a r e a s o n for t h i s ? Were they particular files ? 8 A. I think this must have started, 10 17 r o o m s in t h e b a s e m e n t , 11 with Guinness 12 4 8 9 Q. 13 A. 14 490 Q. 16 A. 17 491 Q. 18 A. 19 492 Q. 20 A. 21 493 Q. 22 A. 23 there was when I was still & Mahon. Yes? A n d wh e n I left Guinness " Well, 15 24 (indicating) 18) ? 6 9 Does this m e a n that files b e l o n g i n g to & M a h o n I said, y o u a r e w e l c o m e to k e e p t h e m t h e r e . " Right? I w a s n o t p a i d rent . You were not? P a i d a rent. Yes, I see? But I was bought a dehumidifier. I see? At least I was lent a d e h u m i d i f i e r which I s u b s e q u e n t l y kept. 494 Q. 25 Yes. T h e y w e r e n o t p a r t i c u l a r f i l e s of G u i n n e s s Mahon? 26 A. 27 495 Q. 28 A. 29 4 9 6 Q. I h a v e n o idea. They just us e d the storage? T h e r e w e r e a lo t o f th e m . I see. So, they were nothing that you had any & 1 2 3 497 Q. 4 A. 5 498 Q. 6 A. 7 8 9 No, fine? Well, n o t so f a r as I a m a w a r e . T h a t is g r a n d ? T h e r e w e r e a lo t o f t h e m a n d I n e v e r l o o k e d at o n e of t h em . 4 9 9 Q. Right. a s k you. Mr. Forwood, I h a v e n o f u r t h e r q u e s t i o n s to Have you any w i n d i n g up ones? 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 E N D O F E X A M I N A T I O N O F MR. F O R W O O D B Y MS. MACKEY: 1 M R . ROWAN: 2 3 4 5 MR. ROWAN: I t h in k t here was just one question which I perhaps 6 7 m i g h t have a s k e d you w hen we were t a l k i n g about the 8 p r o p e r t y i n v e s t m e n t in C a yman? 9 A 10 50 1 Q 11 A 12 502 Q 13 14 Yes . In w h i c h y o u h a d a s m a l l i n t e r e s t ? Yes . W h e n you r e leased that interest, Mr. Forwood, w h a t d i d yo u do w i t h the p r o c e e d s ? A If t h e r e w e r e a n y p r o c e e d s . I me a n I just can't 15 h e l p y o u o n t h a t. 16 m y i n v e s t m e n t w a s £ 1, 00 0 w h i c h w a s w o r t h m o r e t h e n 17 of course. 18 50 3 Q It w a s a s m a l l a f f a i r . I think W e h a v e s o m e i n f o r m a t i o n to s u g g e s t t h a t G u i n n e s s 19 & M ahon b e l i e v e d that the investment w o u l d make a 20 profit? 21 A 22 504 Q 23 A 24 50 5 Q 25 A Yes . Generate a profit? Yes . Of in the r e g i o n of $ 2 00,000? I d o n ' t t h i n k so. I d o n ' t t h i n k so b u t of c o u r s e 26 m y share was 27 q u e s t i o n w a s in a r a t h e r s t r a n g e na m e . 28 506 Q 29 A MS. MACKEY: 1 % so I r e m e m b e r t h a t t h e l a n d in Turin, w a s it? 1 2 A 3 4 MS. A 5 6 MACKEY: I see. I a m n o t p r e p a r e d t o d i s c l o s e it i n t h e p r e s e n c e o f ladies. 508 Q MR. ROWAN: 7 Without giving you a copy o f it t h e r e is a m i n u t e in N o v e m b e r 1970 w h i c h says 8 9 ( E x h i b i t 19): "Mr. T r a y n o r h a s j u s t r e t u r n e d f r o m a v i s i t to t h e I s l a n d s . Satisfactory p r o g r e s s is b e i n g m a d e w i t h t h e d i s p o s a l of p a r c e l s o f land. Considerable delays have occurred which are ou t s i d e T urin's cont r o l " ? 10 11 12 13 A 14 509 Q 15 A 16 51 0 Q Ho w do you spell that? T - u - r - i - n 's ? Right. 17 "We a g r e e d in p r i n c i p a l to e x t e n d b y p e r h a p s t h r e e m o n t h s c e r t a i n of t h e f u n d s t o a l l o w T u r i n to c o m p e n s a t e f o r t h e d e l a y s in t h e p a s t . It l o o k s as if w e w i l l m a k e $ 200,000 p r o f i t w h i c h is m o s t s a t i s f a c t o r y . " 18 19 20 S o . . . (INTERJECTION)? 21 22 A 23 24 D o e s it a p p e a r f r o m t h a t ? 51 1 Q 25 26 29 It l o o k e d m o r e l i k e s o m e o n e w h o w a s a c t u a l l y a c t i n g in the p u r c h a s e ? A 27 28 W o u l d T u r i n h a v e b e e n a p u r c h a s e r of s i t e s ? I c o u l d n ' t p o s s i b l y see that; MS. 512 Q MACKEY: c o u l d I? Certainly. 1 2 51 3 Q 3 A I c a n ' t a c t u a l l y m a k e h e a d n o r t a i l of t h i s b u t 4 o n e p o s s i b l e i n t e r p r e t a t i o n is t h a t T u r i n w a s a 5 prospective purchaser. 6 514 Q 7 A 8 51 5 Q 9 A Does 10 516 Q Yes. His name? I a m ... Sorry. That n a m e crops up in o t h e r m i n u t e s ? it? T h e f e e l t h a t I h a v e f r o m r e a d i n g a l l of 11 those minutes 12 was t h e y w ere a c t u a l l y i n v o l v e d in d i s p o s a l of the 13 land? 14 A 15 is t h a t w h o e v e r o r w h a t e v e r T u r i n W o u l d it? MS. MACKEY: 16 might have been the name 17 18 o f t h e land. A 19 Sorry? MS. MACKEY: l a nd. 21 A 23 24 I t h o u g h t it m i g h t e v e n have b e e n the name of the 20 22 I a c t u a l l y t h o u g h t it v e r y sur e. No. MS. A I was not MACKEY: No. I a m p r e p a r e d to w r i t e d o w n t h e n a m e s t h a t I c a n 25 r e m e m b e r a n d h a n d t h e m to Mr. 26 MS. 27 28 29 MACKEY: Rowan. Y o u do n o t w a n t t o s a y 1 2 It w o u l d n ' t b e a n e s t a t e a g e n t ; 3 MS. MACKEY: Perhaps. MR. ROWAN: T h e y m i g h t w e l l be. 4 517 Q 5 not w o u l d it? W e do k n o w w h o or w h a t t h e y are? 6 7 A 8 518 Q 9 T h e n a m e m e a n s a b s o l u t e l y n o t h i n g t o me. I see. All right. T h a t is a l l r i g h t , I think that concludes our questions. 10 h a p p e n n o w is t h a t Ms. 11 the t i d y i n g up of this t r a n s c r i p t ? 12 A 13 519 Q W e w i l l r e q u i r e y o u to r e a d it t h r o u g h a n d t h e n to 15 send you a draft document? 17 52 0 Q What will Yes . s i g n it a n d h a v e it n o t a r i s e d . A Forwood. Cummins will supervise 14 16 Mr. So t h a t w e w i l l Yes . H o p e f u l l y we will have c o r r e c t e d any obvious errors 18 in it a n d i f y o u a r e c o n t e n t w i t h t h a t p e r h a p s y o u 19 would then please 20 in due c o u rse? 21 A 22 52 1 Q f o l l o w Ms. Cummins' instructions Yes . If y o u w i s h to h a v e a c o p y o f it f o r y o u r o w n u s e 23 you can p u rchase a copy from the firm who looks 24 after the stenography. 25 A 26 522 Q 27 A 28 52 3 Q 29 A Yes . A n d we can arra n g e that f o r you. Yes . 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