HAUGHEY’S DOWNFALL
Liam Collins on the week The Boss cracked
THE headline said it all: “Haughey’s Humiliation — former Taoiseach counts the cost of his £1.3m gift”. Twenty years ago this week, probably the most revered and reviled Taoiseach of modern times — the man who irrevocably changed the face of Irish politics — walked into Dublin Castle and admitted receiving over £1m from businessman Ben Dunne, the majority of it used to pay off his massive overdraft with the remainder channelled through a labyrinthine system to his own personal bank accounts.
“Mr Haughey’s amazing confession that he had known Mr Dunne was the donor four years ago was the biggest political bombshell since his involvement in the Arms Trial of 1970,” said a report beneath the sensational headline.
The house of cards that began to crumble with Ben Dunne’s antics on the 17th floor balcony of a hotel in Florida had finally collapsed, enveloping the reputation of the man who had departed the Dail, saying: “I have done the State some service”.
Chaos theory, a belief that one small distant event can have the most unlikely consequence, was unleashed.
The past, they say, is another country and two decades on from that moment, when a humbled Charlie Haughey walked across the slick cobblestones of the Upper Courtyard in Dublin Castle, embraced by one lone supporter saying: “I love you, Charlie,” the landscape of Irish political life has never been the same.
Now an openly gay Fine Gael Taoiseach, Leo Varadkar, has a shifting, soft-edged, almost apolitical style that contrasts dramatically with the brittle and bloody politics of the Haughey era, where internal and external battles were conducted in street-fighting style, with intimidation and a fierce partisanship that even spilled over into low-level violence.
It was also a time when the middle ground of both Fianna Fail and Fine Gael still commanded unbending loyalty born out of the bitterness of the Civil War.
Whether it was Haughey alone who destroyed that political passion by his cult-like leadership and divisive style is open to debate, but the fervour of that era among the centre parties is now mostly to be found on the fringes, in Sinn Fein, the small socialist sects and the anti-everything brigade.
Walk up Merrion Street in Dublin and you’ll see the grand entrance to the Taoiseach’s office, which Charles Haughey personally rescued from semi-delinquent engineering students and remodelled to reflect the French-style pomp he wished to emulate. Essentially, he was preoccupied with big ideas and did not concern himself with the mundane, especially when it came to his own personal finances.
In his private life, he imitated the ascendency he politically reviled, acquiring a Gandon mansion and estate in Kinsealy, an island retreat, a fitting mistress in Terry Keane, entertaining lavishly with the ‘company’ credit card in Le Coq Hardi, as well as making use of it in the Charvet emporium in Paris and elsewhere. But it all came with a price. Before the events that unfolded on this date in 1997 (a Wednesday) I frequently sat with him in his little study at the front of Abbeville, as he shredded the reputations of his enemies. Behind me, the fax machine would spit out documents from the McCracken Tribunal and he would wave a blazer-clad arm disdainfully, asking: “How am I expected to deal with all these questions?”
His default position was deny, deny, deny.
Although nobody knew it at the time, it all began to unravel in the early hours of February 19, 1992 after supermarket heir Ben Dunne looked up the Yellow Pages and ordered Denise Wojcik from Escorts in a Flash to his $1,200-a-night suite on the 17 th floor of the Grand Cypress Hotel in Orlando, Florida.
Cocaine-fuelled paranoia took hold at 6am that morning when, as Denise would later describe it, “he was like some crazed King Kong, jumping up and down and swinging objects over his head.” Beset by flashbacks from an IRA kidnapping years earlier, he went out to the atrium, threatening to jump and bellowing at the early morning businessmen having breakfast below. Dunne managed to survive the episode and get home to Dublin, where his formidable sister Margaret Heffernan was furious with the shame he had brought upon the family. Little did they know it at the time, but Charlie Haughey and the cream of Irish business society would become enmeshed in the fallout of the family feud that ensued in the years that followed. Just as Haughey ruled Fianna Fail in an autocratic style, so too did Ben Dunne exert almost total control over the sprawling retail empire built by his father. Ironically Ben Snr, who was revered in the family, did not get on with Haughey personally, although they were known to each other through the racing and bloodstock business. The story was told that when Haughey led a delegation from the Irish Export Board to a trade fair in New York, Dunne Snr took a stand to display his ‘St Bernard’ brand of clothes which were the mainstay of his growing empire. Passing the display, Haughey was supposed to have remarked: “What do you think this is, the f***ing Iveagh market?”
True or not, the story reflected the gulf between the aspirations of both men.
When Ben Dunne Snr died in 1983, the company had 67 stores and a turnover of £300m; 10 years later, under Ben Jnr’s direction, there were 97 stores and a turnover of £1bn.
Despite his style and bad behaviour in Florida, he seemed impregnable, with the support of his two sisters Elizabeth and Therese, while Margaret only had the support of the oldest member of the family, Frank, who had largely withdrawn from the business to look after his bloodstock interests.
But a bloody corporate battle for control of the business was being waged on the executive floor of the company headquarters with tension between the two powerful siblings spilling over and involving other family members. When the youngest member of the family, Therese, changed sides, Ben Dunne’s future as leader of the business was sealed.
At a board meeting on February 15, 1993, he was ousted and his brother Frank was installed as executive chairman.
At first, Ben tried to sell his stake to the family but a deal could not be agreed because of the complex nature of the Dunnes Stores Trust and the tax liability that would accrue if it was broken up. He then moved to have the Trust broken up and Haughey was instrumental in organising a meeting between the Trustees and the Revenue Commissioners to see how this could be done without incurring a huge tax liability.
In the meantime, the firm commissioned a report from accountancy firm PwC which disclosed a litany of bogus accounts, false invoices and ‘off the book’ deals during his stewardship of the retail chain. But it was only later, when Ben Dunne began legal pro- ceedings to break up the Dunnes Stores Trust, that he himself first revealed details of the £1.3m given to Charles Haughey in highly secretive legal documents.
The much-anticipated court case did not go ahead, it was settled at the last minute, but the genie was out of the bottle as the details of the payments were now down in black and white. As an eminent legal figure once remarked: “If more than two people know anything in this town, it’s no longer a secret.”
For Margaret Heffernan, it was the beginning of a quest to get the family millions back.
She even drove out to Kinsealy herself for a showdown with the man whose minions called him ‘The Boss’.
“My brother Bernard says he has given you over £1m. Can you confirm that this is true?” she asked.
“I can’t be responsible for what your brother is saying,” Haughey, who had retired as Taoiseach in December 1992, replied, adding that in his opinion, her brother was “unstable”. When the Dunne family later wrote demanding their money back, Haughey replied: “As no such monies have been paid, no repayment arises”.
When details of the Dunne payments began to circulate in the media, the McCracken Tribunal was established to investigate payments to both Charlie Haughey and up-and-coming Fine Gael minister Michael Lowry, whose grand ambitions withered in the resultant investigations.
On April 30, 1997, the Tribunal heard evidence of the ‘little black book’ carefully guarded by financial consultant Des Traynor, which contained coded information relating to between £30-£40m in funds held offshore in the Cayman Islands by the cream of Irish business and social circles, including Haughey, in what were to become infamously known in the years that followed as the Ansbacher accounts.
As the money trail drew closer to Kinsealy, its beleaguered martinet Charlie Haughey sought a series of meetings with Ben Dunne’s solicitor Noel Smyth to discuss what he called the “lethal pieces of paper” in circulation, which were three bank drafts totalling £210,000 made out in fictitious names which had ended up in his bank account.
Unknown to Haughey, Smyth made written minutes of each meeting, which he put in sealed envelopes and posted to himself and which he then presented unopened to the McCracken Tribunal.
Although no details were ever revealed, it is believed that on July 7, 1997, Haughey, ahead of his appearance as a witness at the McCracken Tribunal, met with his legal team during which he was told bluntly that they no longer believed his denials and unless he confessed, they would withdraw their representation. And so to the humiliation. “I now accept that I received the £1.3m from Mr Ben Dunne and that I became aware that he was the donor to the late Mr (Des) Traynor in 1993 and furthermore I now accept Mr Dunne’s evidence that he handed me £210,000 in Abbeville in November, 1991,” he said in a short statement.
“Mr Haughey said he had mistakenly instructed his legal team until last Monday, but that they had agreed to continue to represent him for the duration of the tribunal,” reported the Irish Independent.
When he reappeared on July 15 to give a fuller explanation, he accepted that the “problems and embarrassment that I have caused would have been avoided if I had been more forthcoming”.
As always, there was justification. “I never had to concern myself about my personal finances. He (Des Traynor) took control of my financial affairs from about 1960 onwards. He saw it 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.
“The late Mr Des Traynor had complete discretion to act on my behalf without reference back to me. In hindsight, it is clear that I should have involved myself to a greater degree in this regard.”
Although he had lied, Haughey’s contention that there were “no favours sought and none given” for the money was never disproven by the highly paid legal teams lined up to puncture his evidence. “I never tried to compromise anybody in anything I ever gave,” Ben Dunne agreed, saying his donations came with no “strings attached”.
“The Tribunal,” concluded Judge Brian McCracken, “considers it quite unacceptable that Mr Charles Haughey, or indeed any member of the Oireachtas, should receive personal gifts of this nature, particularly from prominent businessmen within the State.
“It is even more unacceptable that Mr Charles Haughey’s whole lifestyle should be dependent upon such gifts, as would appear to be the case. If such gifts were to be permissible, the potential for bribery and corruption would be enormous.”
Hardly a day goes by now without someone demanding a public inquiry into some aspect of Irish life, but none will ever have the drama of Shakespearean proportions that ruined or tarnished so many reputations two decades ago.
‘She said he was like a “crazed King Kong”’