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Ireland's 'Golden Circle' Accused of Tax Evasion

July 07, 2002|From Times Wire Services

DUBLIN, Ireland — Government investigators issued a long-awaited report Saturday on the biggest tax-evasion scandal in the history of Ireland, alleging that many of the country's business leaders secretly deposited millions in an illegally run bank for decades.

Scores of people lined up outside the government publications office in central Dublin to purchase copies of the 10,000-page report for $145 each. The inquiry has drawn huge interest in Ireland amid allegations that a "golden circle" avoided paying millions when the Irish faced some of the highest tax rates in Europe.

The bank's secret clients included disgraced former Prime Minister Charles Haughey, doctors, athletes, property developers and even a former director of the Central Bank of Ireland.

"The report concludes unambiguously that a variety of individuals and corporations knowingly promoted widespread tax evasion," said Deputy Prime Minister Mary Harney. However, she added that its publication "demonstrates that we in Ireland now have the capacity and the courage to lift the veil of secrecy and the determination to enforce the law."

The report is the product of a three-year, $3.1-million investigation into the Irish operations of Ansbacher Ltd., a Cayman Islands-registered bank co-founded by Haughey's late accountant, Des Traynor. It lists 169 depositors and 10 people who conducted other business through the illegal bank, which hid money from tax authorities offshore and enabled Traynor's high-earning associates to dodge crippling Irish tax rates that sometimes exceeded 50%.

The existence of the firm was uncovered in 1997 by a tribunal investigating controversial payments to scandal-dogged Haughey, whose lavish lifestyle once included spending nearly $22,000 of public money on shirts handmade in Paris.

Two of the depositors this year unsuccessfully sued the government in an attempt to prevent the publication of Ansbacher names.

The government's director of corporate enforcement, Paul Appleby, said Saturday that the report found that Ansbacher was never legally registered in Ireland during the approximately 20 years Traynor oversaw its deposits and loans to Haughey and influential business friends.

Ireland's tax authorities vowed last month to "stick like limpets" to the holders of Ansbacher accounts until they have exacted all tax, interest and penalties owed to the government.

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