Haughey's Forty Years of Controversy (34 page)

At the end of his testimony, Haughey announced that he was leaving to return to his ‘books and bucolic pursuits'. He slipped gracefully into official retirement on 5 November 1992 when the government came crashing down after Reynolds was accused of being ‘dishonest' in his testimony at the Beef tribunal. On formally retiring Haughey indicated that he would not write his memoirs and would not be making any further public statements.

Haughey did do some charity work and he seemed to be enjoying his retirement. While at Kinsealy he went riding regularly on Portmarnock strand on his hunter,
Gatsby
, and he took a keen interest in his racehorses, especially
Flashing Steel
, which won the Irish Grand National on Easter Monday 1995, when the Taoiseach John Bruton was presenting the trophy.

Haughey continued to perform the official opening of the Dingle Regatta. There was an extraordinary story in the
Irish Independent
on 27 August 1997. In covering the opening of Dingle Regatta the previous day, Miriam Lord reported that Haughey had ‘fallen off the
Celtic Mist
' in Dingle Harbour and had to be plucked out of the sea by a marine rescue helicopter. ‘That's what happens, when you are enjoying your retirement and have no responsibilities,' she wrote. ‘You fall into the sea.'

It was Miriam Lord who had gone overboard, because there was no truth to the report. She was apparently joking, but the story obviously was garbled. If Haughey had actually fallen into the sea and been rescued in that way, it would have been front-page news, not just buried in the middle of the newspaper.

Miriam telephoned Haughey to apologise next morning. He undoubtedly had grounds for a legal action, but he graciously accepted her apology. When she asked how he would like her to apologise in print, he told her to do it whatever way she wished, or not to bother at all. He was content with her telephone call and he told her she could forget it.

‘Sorry. Sorry. Sorry. I'm as sick as pig', she began an open letter to Haughey next day. ‘I have done you a dreadful disservice.' She admitted that he had never fallen off the
Celtic Mist
and had not been rescued by air corps. Haughey rescued Miriam on that occasion.

He was only out of the Taoiseach's office for little over a week when an incident occurred in Miami, Florida, that was to have profound long-term repercussions. The police arrested Ben Dunne as he threatened to jump from a high-rise hotel building. He was high on cocaine and apparently thought he could fly. The saga of his involvement with Haughey would gradually unravel as an indirect consequence of his erratic behaviour that night.

In the aftermath of the Miami incident, his sister, Margaret Heffernan, ousted him as chief executive of the family business. A bitter family feud followed as he sought to break up the family trust. She was horrified to learn from a company accountant in July 1993 that her brother had given Haughey over £1 million of company money. It was bad enough giving it to a politician, but giving it to Haughey was the last straw, because her father had detested him ever since an incident between them at a trade exhibition in New York in the 1960s. Ben was unwilling to provide his sister with details of the cheques he had given to Haughey.

‘If you don't tell me,' she warned, ‘I'm going to keep digging.'

‘You can look all you like,' he replied. ‘You'll never trace them.'

She confronted Haughey personally. ‘I said it had come to my knowledge that my brother had given him £1.1 million,' she explained. He had actually given him at least £1.93 million.

‘I can't be responsible for what your brother says,' Haughey replied. He went on to say that Ben ‘was unstable'. When she tried to press him about the money, he avoided the issue. ‘He kept going back to the stability of my brother,' she said.

‘I was as non-committal as I could be to Mrs Heffernan, because that's the first time I heard this rumour about this million pounds,' Haughey later contended. He said he only referred to Dunne as being unstable in the light of her remarks. ‘I may have said “From what you describe, Margaret, it would seem that your brother is acting in an unstable way”,' he explained.

In March 1994 Noel Smyth, Ben Dunne's lawyer, told Haughey that the story of the Dunne money might be made public. Haughey response was to lie, to say that he had never received any money from Dunne. In fact, throughout his numerous meetings and some forty different telephone conversations with Smyth during the next couple of years, Haughey never actually admitted that he had received money from Dunne, but Smyth did not need an admission.

‘If Mr Haughey wanted to make some other case I was leaving that really to him,' Smyth explained. ‘I knew I had sufficient documentary evidence.'

The Dunne family feud was resolved in November 1994. Dunne was bought out for some £100 million, but solicitors for Dunnes Stores still tried to recover the money from Haughey. On 13 November, they wrote to him with details of the payments that they contended were ‘improperly diverted' to him.

‘As no such monies had ever been paid to me by Mr Ben Dunne or any of the companies mentioned, no question of repayment arises,' Haughey replied next day. ‘I take grave exception to the use of the words “improperly diverted” and the implication that I was aware of such conduct by or on behalf of Mr Ben Dunne.'

Haughey's stalling tactics began to unravel in December 1996 when the Dáil requested Judge Gerard Buchanan to investigate payments made by Dunne to Michael Lowry, after he was forced to resign as a minister in the Rainbow coalition. Haughey's name became linked with the disclosure that £20,000 had been paid to his wife for his election expenses in 1989. It was also disclosed that Haughey's son Ciarán had been paid £10,000 for helicopter services and his brother, Fr Eoghan Haughey, had been paid £2,000 for masses. But then
Phoenix
magazine broke the story that Haughey had been given over £1 million. Because of the Buchanan report, the government established a tribunal under Mr Justice Brian McCracken to investigate Dunne's payments to politicians. The tribunal had already been set up when Noel Smyth showed Haughey three bank drafts that Dunne had given him at Abbeville in November 1991. Viewing the drafts as ‘lethal', Haughey admitted to Smyth that they ‘could be a cause of some embarrassment.'

‘I think he said “is there any way we can get rid of these?”' Smyth later testified. It was reminiscent of Haughey's question to Des O'Malley about Peter Berry's forthcoming testimony shortly before the arms trial.

Haughey had told Smyth in 1993 that he had not availed of the tax amnesty, with the result that Smyth concluded that he was likely to have trouble with the revenue commissioners. Dunne had therefore authorised him to offer Haughey ‘up to £1 million' more towards the cost of settling his tax affairs. Smyth urged Haughey to make a full disclosure about the money.

Although he acknowledged the ‘very gracious offer', Haughey said it was ‘impossible' for him to accept it, even though Smyth warned that the tribunal, with its very extensive powers, was likely ‘to get all the information sooner rather than later.' He again advised Haughey to do himself a ‘huge favour' by making a clean breast of things. But Haughey tried to brazen it out.

Throughout most of the time that the McCracken tribunal sat, he denied that he had received any money. On 7 July 1997, he submitted an eight-page statement denying that any meetings took place between Ben Dunne and himself at Kinsealy, or that he had received three cheques totalling £210,000 from him in person, but this time he had gone too far. He stated that he first heard of the Dunne money when Margaret Heffernan confronted him in July 1993. He added that he then telephoned Des Traynor, who said that he would be meeting her himself to ‘hear what she had to say but that I need not be concerned about these rumours as they were without foundation.'

That was unbelievable. The tribunal had enough evidence to convinced Haughey's own lawyer that his client's position was untenable. The tribunal sitting was suspended for the day and the next morning Haughey submitted a revised statement accepting that he had indeed received the money and he had misled the tribunal.

‘As a result of reviewing the excellent work of the tribunal and considering the very helpful documentation recently received from Mr Ben Dunne's solicitor, I now accept that I received the £1.3 million from Mr Ben Dunne and that I became aware that he was the donor to the late Mr Traynor in 1993, and furthermore, I now accept Mr Dunne's evidence that he handed me £210,000 in Abbeville in November 1991,' Haughey declared. ‘In making this statement, I wish to make it clear that until yesterday, I had mistakenly instructed my legal team.'

Haughey testified before the tribunal in Dublin Castle on 15 July 1997. Members of the public had been gathering in the early hours of the morning to gain access to the tribunal chamber. Haughey arrived before 7.30 a.m., eluding reports and photographers. He was no longer the same combative witness who had appeared before the Beef tribunal less than five years earlier. At the outset, he read a prepared statement in which he expressed regret for his behaviour in not co-operating with the tribunal ‘in the manner which might have been expected of me.'

He insisted that he did not know where any of the money had come from until July 1993, but he admitted that his statement ‘was incorrect' that Traynor had dismissed the story as a rumour when he first talked to him about it. ‘I can only suggest that I was reluctant to face the inevitable consequences of disclosure,' he explained.

He clearly tried to dump the responsibility for the handling of his finances on Traynor, who had died in 1994. ‘I never had to concern myself about my personal finances,' Haughey said. ‘He took over control of my financial affairs from about 1960 onwards. He sought, as his personal responsibility, to ensure that I would be free to devote my time and ability to public life and that I would not be distracted from my political work by financial concerns.'

‘Traynor had complete discretion to act on my behalf without reference back to me,' Haughey continued. ‘In hindsight, it is clear that I should have involved myself to a greater degree in this regard.'

‘My private finances were perhaps peripheral to my life,' he contended. ‘I left them to Mr Traynor to look after.' Of course this was not the case with the three cheques worth £210,000 that Ben Dunne had handed to Haughey, who said that he could not remember that incident. But he accepted Noel Smyth's documentary evidence and Dunne's word that it did happen.

It was pointed out that a sizable loan taken out by Celtic Helicopters was paid off from an off-shore account that had been set up for him by Traynor in the Ansbacher Bank. Haughey said that he was unaware of this transaction but that Traynor would have known it was acceptable to him to use such funds for family-related business. Although Haughey had been spending much more than his official salary, he denied that he lived extravagantly.

‘I didn't have a lavish lifestyle,' he told the tribunal. ‘My work was my lifestyle and when I was in office I worked every day, all day. There was no room for any sort of an extravagant lifestyle.'

He had to concede, however, that as recently as 7 July 1997, he had been ‘persisting in accounts of events which were short of the truth.' Yet, while he was on the stand, neither he nor any of the lawyers referred to his deception as lying.

‘It wasn't a full explanation,' he insisted.

‘It was pretty economical?' counsel asked.

‘I hate to use that phrase,' Haughey relied.

‘It was not true, Mr Haughey, isn't that right?

‘It was not a full explanation.'

When he emerged from the tribunal, a crowd of up to 1,000 people had gathered outside Dublin Castle. There was a smattering of applause, but his loyalists were quickly drowned out by booing.

On 25 August 1997 the tribunal report was published in which McCracken concluded that it as ‘quite unacceptable that a member of Dáil Éireann, and in particular a cabinet minister and Taoiseach, should be supported in his personal lifestyle by gifts made to him personally.'

The report was a devastating indictment in which the judge made little or no effort to hide his annoyance at the way that Haughey had prevaricated and lied. He had wasted the time of the tribunal by repeatedly ignoring requests for information. Then, when he did provide answers, he lied in three separate written submissions. The judge also concluded that the former Taoiseach had not been honest in his actual testimony either.

‘The tribunal considers Mr Charles Haughey's evidence to be unacceptable and untrue,' he wrote, citing eleven different instances in which he described the former Taoiseach's evidence as ‘not believable', ‘quite unbelievable', ‘most unlikely', ‘beyond all credibility', or ‘incomprehensible'.

Since Haughey admitted that he knew about a £105,000 loan from the Agricultural Credit Corporation during the late 1980s, McCracken found it strange that he ‘did not admit to being aware of any other loans.' He did not believe the story about not remembering the three cheques given to him by Ben Dunne in November 1991.

‘It is not believable that a person could not remember an event such as this, which was quite bizarre,' McCracken contended. ‘It is also most unlikely that if Haughey gave those bank drafts to Des Traynor, Traynor did not reveal that other moneys had been received from Dunne at an earlier date.'

The judge refused to believe several aspects of the former Taoiseach's story involving his relationship with Des Traynor. For instance, McCracken found it ‘unbelievable' that Traynor managed all of Haughey's financial affairs since the 1960s without reference to him. Moreover, it was ‘quite unbelievable that Traynor would not have told in some detail of the difficulties and it is equally unbelievable that Haughey would not have asked.' It was incredible that he would not have discussed the tax implication with Traynor. McCracken argued that it was ‘far more likely' and ‘far more consistent with his subsequent actions' that the tax implications were discussed and ‘that it was decided that the money should be kept off-shore and that its receipt should never be acknowledged.' Since Traynor had apparently been ‘a meticulously careful person', it was unlikely, according to the tribunal report, that he would ‘have used any money in the Ansbacher deposits, which were held for the benefit of Haughey, to support Celtic Helicopters unless he had the authority of Haughey to do so.' After Traynor's death in 1994, it was ‘beyond all credibility' that the former Taoiseach ‘would not have become very concerned as to his affairs, and particularly concerned to ensure his assets were secured.'