The Tanaiste, Ms Harney, is considering further moves to investigate the National Irish Bank offshore bond scheme, having decided to refer the interim report of her authorised officer to the Director of Public Prosecutions.
A spokesman for the Tanaiste said last night that, after taking advice from her officials and the Attorney General's office, she would consider her options "overnight" and was likely to make a further statement today. Among the options open to the Tanaiste are to ask the High Court to appoint an inspector to look into the matter. Such an inspector would have more powers than the authorised officer and could publish a report. Alternatively, she could ask Mr Martin Cosgrove, the authorised officer, to continue his investigations.
Two High Court inspectors, Mr Tom Grace and Mr Justice John Blayney, are already investigating allegations of overcharging at the bank and an option for Ms Harney would be to ask for their terms to be extended. However, the High Court would have to be persuaded that there was a legitimate argument for the NIB bonds scheme to be the subject of an inspector's inquiry.
Ms Harney met her senior officials and officers from the Attorney General's office for 90 minutes late yesterday afternoon. She also had access to written opinion from senior counsel.
Following the consultations, Ms Harney decided, as expected, to refer the interim report to the DPP, Mr Eamon Barnes. He will decide whether to pursue either NIB, some of its executives or some of the depositors through the courts. The Office of the Revenue Commissioners is also considering whether to pursue some of the NIB depositors for criminal tax evasion and is also examining the role of NIB executives in marketing the schemes.
While the Revenue already has a large number of names of the NIB depositors, Ms Harney may refer the interim report, which is understood to contain some 300 names, to the Revenue. She also has powers to initiate prosecution herself for any breaches of company law, but is thought unlikely to pursue this in the short term.
Ms Harney has no powers to publish the names of the depositors and such a move was never likely to be undertaken independently, as it is unlikely that all the account holders in the scheme were trying to hide money from the tax authorities. However, if a High Court inspector is appointed to examine the scheme, it is possible that the resulting report could contain some or all of the names of the depositors.
Many of the depositors are understood to be owners of small to medium-sized businesses or professionals, though Ms Harney has said that a number of names of "influential" individuals are also on the list.
It is understood that around 500 separate offshore accounts were identified in the scheme marketed by National Irish Bank Financial Services, mainly on behalf of Clerical Medical International (CMI), an Isle of Man company. As some depositors held more than one account, there are believed to have been around 300 depositors with up to £50 million invested in the scheme. Under the CMI scheme, the investors purchased an insurance based product, which allowed them to place their funds overseas in the Isle of Man.
NIB recently admitted that there were problems with a significant minority of the accounts in terms of documentation, with many being held under false names. However, the bank has always strongly denied that the scheme was marketed as a tax evasion device.
When the affair first broke, Ms Harney and her Minister of State, Mr Noel Treacy, used powers available in insurance law to appoint Mr Cosgrove as an authorised officer.
