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Transparency International Ireland calls for Irish and Norwegian investigations into payments to Fine Gael and former Communications Minister

Dublin, 24 March 2011 - Transparency International (Transparency) Ireland has asked that the Gardaí, Criminal Assets Bureau, Office of the Director of Corporate Enforcement and Norwegian authorities lead investigations into any prima facie criminal activities or company law violations surrounding the award of Ireland’s second mobile licence in 1995. The Organisation for Economic Cooperation and Development (OECD) will also be asked to review progress in the case.

The statement comes after Tuesday’s publication of the final Moriarty Tribunal report on payments to Irish politicians which found that the former Minister for Communications Michael Lowry had received over £500,000 in secret payments in respect of his time as Minister overseeing the award of the telecommunications licence.

The anti-corruption group has also called for:

1. The identification and potential freezing of profits arising from any illicit payment made directly or indirectly to Mr Lowry by Mr Denis O’Brien, or any other members of the winning Esat Digifone consortium, or their agents.

2. The Norwegian authorities to investigate an attempt by Telenor Mobile to make a secret £50,000 (€63,000) donation to the Fine Gael party after the award of the licence to the Esat Digifone consortium of which Telenor Mobile was a member.

3. The Irish authorities to investigate alleged corrupt payments by Mr Ben Dunne to Mr Michael Lowry T.D. and any apparent illicit enrichment arising from Mr Dunne’s payments.

“If evidence of criminal wrongdoing is uncovered by the Gardaí and Norwegian authorities, prosecutions must follow. Where there is sufficient evidence to show that profits have arisen from corrupt transactions, those profits must be seized by the Irish State”, said John Devitt, Chief Executive of Transparency Ireland. “It is also worth noting that if a finding were made of corrupt enrichment arising from the award of the second mobile licence, the proceeds from a seizure could more than recoup the running costs of the Moriarty Tribunal for the Irish taxpayer”, Mr. Devitt added.

Transparency Ireland has also called on Mr Justice Moriarty to forward any evidence of obstruction or attempts to mislead the Tribunal to the Director of Public Prosecutions.

Systemic change needed to prevent repeat of abuse of power

In 2009, Transparency Ireland published a National Integrity Systems study on the risk of corruption in Ireland and made some 40 recommendations to deal with them. Not one of the recommendations has been fully implemented. Transparency repeats its call for reforms that would help both clean up politics and help prevent the kind of abuse found in both Moriarty Tribunal reports.

Transparency Ireland has urged the new government to ensure:

1. The introduction of legislation banning corporate donations and consider the introduction of an opt-out system to allow taxpayers to make small contributions to political parties.

2. The publication of audited and standardised accounts by all political parties.

3. A mandatory register of lobbyists with criminal and civil sanctions for failure to disclose the identity of clients and income.

4. The publication of all sources of donations to political parties over €100 as well as the identity of ‘bundlers’ or organisers of fundraising events and appeals.

5. The delegation of powers to the Standards in Public Office Commission to appoint an Inquiries Officer to investigate suspected violations of the Ethics Acts without a complaint.

6. The introduction of universal whistleblower legislation that would protect civil servants and workers in the private sector for reporting concerns in the public interest.

7. The review of all public contracts over a certain value by the Comptroller and Auditor General with additional emphasis on compliance with anti-fraud and corruption safeguards.

8. The ratification of the United Nations Convention against Corruption.

Questions and Answers for Editors

The following questions and answers may be helpful in identifying corruption related offences:

1. Does anyone have to prove that a licence or contract was awarded in return for any payment or gift?

No. Any payment offered or received in order to influence a public official is deemed to be a corrupt act under the Prevention of Corruption Acts 1889 to 2010. This includes influencing a public official to give advice, the release of information or the untimely release of information on a public contract or State licence competition. No proof would be needed that any transaction directly secured a state contract or licence for a finding of corruption to be made.

2. Does money have to change hands for a prosecution to take place?

No. Sufficient evidence of an offer of any gift or advantage in an attempt to influence a public official is grounds for prosecution. Offering an advantage for ‘services to be rendered’ or an attempt to pay a ‘kickback’ to a public official for ‘services already rendered’ is also an offence.

3. Does a public official have to benefit directly from a bribe or attempted bribe?

No. It is sufficient that any person is offered a bribe once the purpose of the bribe is to influence the conduct of a public official. A bribe may be any payment or advantage, such as a loan, job offer or insider information. A political party, a business or consultancy may also be regarded as an ‘agent’ under the terms of the Prevention of Corruption Acts.

4. Must a conviction of corruption be secured before the proceeds of a corrupt transaction can be seized?

No. Under the Proceeds of Crime (Amendment) Act 2005 the High Court can order that the proceeds of any crime including corruption be frozen or seized by the State. The order is made after the court has ruled, on the balance of probabilities, that a corrupt transaction led to the enrichment of an individual or organisation.

5. Is witness testimony required to secure a conviction for corruption?

No witness testimony is required under the Prevention of Corruption Acts, to secure a conviction for corruption. A jury simply needs to be convinced, beyond a reasonable doubt, that corruption has occurred. In some cases financial evidence may be sufficient, in others, witness testimony may be necessary. This is the reason universal ‘whistleblower’ legislation and some form of witness leniency programme are urgently needed.

6. How hard is it to secure a criminal conviction for corruption?

Since 2001, it has been much easier for the authorities to secure a conviction of for corruption than was previously the case. While the burden of proof still rests with the prosecution in corruption cases, a public official may have to show that any hidden payments were not lawfully acquired. If they cannot prove this, the assumption is made that the payment was a corrupt one. Of the eight prosecutions for corruption brought to court since 2003, seven have been successful. It would therefore be wrong to conclude that securing a conviction of corruption is impossible.

7. How corrupt is Ireland?

It is very difficult to say. Ireland is regarded by the international business community as being a relatively clean place to do business. It is currently ranked 14th out of 180 countries on Transparency International’s Corruption Perception Index (CPI). However, the international business community does not seem to have noticed the scale of the problem. According to Transparency’s Global Corruption Barometer, 90 per cent of the Irish public does not believe that the government is doing enough to stop corruption, while 60 per cent believe that levels of corruption in Ireland are rising.

8. What happens next?

The Government has forwarded the final Moriarty Tribunal report to the Director of Public Prosecutions (DPP). However the DPP cannot investigate alleged offences. The Gardaí will have to uncover evidence of wrongdoing again with a fresh investigation into the circumstances surrounding the case. This is because evidence and testimony presented at a Tribunal of Inquiry cannot be used to secure a criminal conviction against a witness in the tribunal. It could take over two years to conclude, however it should be noted that once a corruption-related case is brought to court by the DPP it generally has a very good chance of succeeding.