The Minister for the Interior in Bulgaria has said he wants to resolve a controversy surrounding the visit to his country by an Irish party that included Mr Phil Flynn, as it was damaging to Bulgaria.
Prof Georgi Petkanov said it was in the interest of his country that the controversy over the visit be resolved "in an undoubted way".
Mr Flynn is a director of Chesterton Finance Company, the Co Cork-based firm at the centre of the Garda investigation into money laundering.
A representative of the Bulgarian security service is in Ireland to establish contacts with the Irish authorities and "to clear up this case that is unpleasant for our country", the ministry said in a statement yesterday.
The controversy has been receiving extensive coverage in Bulgaria, which is sensitive to suggestions it might be an attractive location for money laundering. It hopes to join the EU by 2007.
The chief secretary of the Bulgarian interior ministry, Lieut Gen Boiko Borissov, has discussed the case with the Bulgarian Prime Minister, Mr Simeon Saxe Coburg Gotha, according to reports.
Corporate Commercial Bank in Sofia issued a statement to The Irish Times in which it said that "two accounts of Irish citizens were opened in the bank with €1,000 each and there had been no subsequent movements on the accounts".
The ministry has said that four Irish representatives "came to Bulgaria as representatives of a financial institution registered in Amsterdam with capital of roughly €14 million".
A spokeswoman said she could not give the name of the financial institution.
Mr Flynn said that this must be an error and no such financial institution was involved. "I've no idea what they're referring to."
The Irish party stayed in a hotel in Sofia, rented offices, engaged lawyers and opened bank accounts, the ministry said.
The party included Mr Flynn, Mr Ted Cunningham of Chesterton Finance, and a female consultant based in Ireland with experience of doing business in Bulgaria, who was yesterday in Garda custody.
The Bulgarian deputy finance minister, Mr Ilya Lingorski, met with Mr Flynn and the rest of the party in a restaurant in Sofia, the Pri Orlite. The meeting was a "working lunch", according to a spokeswoman for the ministry. Mr Lingorski was not available for comment.
The meeting is understood to have been set up by the woman who is in custody.
The Bulgarian authorities have said on a number of occasions that all inquiries to date had found no evidence of anything illegal about the visit.
They aim to identify all Bulgarians who met with the Irish party during their visit.
The head of the Financial Intelligence Agency in Bulgaria, Mr Vassil Kirov, told The Irish Times that Bulgaria had a very well- developed system for monitoring money laundering.
Accounts can be accessed without court orders. "Our system is better than that of many EU member-states," he said. "I wouldn't advise anyone who wanted to launder money to come to Bulgaria."
He said he did not want to comment directly on the controversy concerning Mr Flynn's visit. "I wouldn't want to make a statement that would not help my colleagues in Ireland."
Agreements between Ireland and Bulgaria can allow real-time, secure exchanges of information between the two states, he said.
"Last year money linked with fraud in Ireland was frozen in an account in Bulgaria before we had been contacted by the Irish authorities," he said. He did not want to name the Irish bank involved, but said €300,000 was sent to Bulgaria by someone who pretended to be a client of the bank. Mr Kirov said his agency is involved in vetting applicants for banking licences and that very thorough checks are made as to people's suitability.
