The Mazars audit and tax firm has been appointed to carry out an independent review into the financial matters of “grave concern” revealed by the Irish Horseracing Regulatory Board to the Oireachtas Public Account Committee (PAC) on Thursday.
In a “bombshell” statement to PAC, the IHRB’s chief executive Darragh O’Loughlin, said he had become aware two days previously of an issue linked to “governance around financial transactions” that had occurred early last year.
The IHRB’s chief financial officer, Donal O’Shea, who had been due to appear before PAC alongside Mr O’Loughlin, is on what has been described as “voluntary leave.”
[ IHRB thrown into disarray by ‘bombshell’ revelation of ‘grave financial concern’Opens in new window ]
Despite close questioning by PAC members, Mr O’Loughlin remained tightlipped on the precise nature of the matter of concern but indicated an independent investigation would be carried out.
On Friday evening, an IHRB spokesman confirmed that investigation will be carried out by Mazars, a leading international audit, tax, and advisory firm with over 600 staff across offices in Dublin, Galway and Limerick.
It is expected the Mazars review will take a number of months.
Mr O’Loughlin said on Friday that he doesn’t believe the issue involves “anything in the nature of personal gain.” He also told RTÉ’s Morning Ireland it didn’t involve public money being misappropriated.
The IHRB wouldn’t comment further on a controversy that has thrown Irish racing’s regulatory body into disarray and provoked intense speculation on the precise nature of the problem.
An uncomfortable appearance before the PAC on Thursday was also notable for Mr O’Loughlin admitting that governance around a €384,870 termination payment to his predecessor, Denis Egan, was “clearly not” what it should have been.
The IHRB boss came under fire for how that payment was 58 per cent more than allowed under a Horse Racing Ireland early retirement scheme although the regulatory body has insisted the extra payment didn’t come from public funding.
Mr O’Loughlin admitted the IHRB board ignored an instruction from Minister for Agriculture Charlie McConalogue to include Mr Egan’s 2021 remuneration in its financial accounts for that year.
Legal position
Mr O’Loughlin, who stepped into the role as chief executive last year, said that request had put the IHRB in a difficult legal position as Egan’s employment conditions didn’t provide for the publication of his salary.
A derogation from previous minister for agriculture Michael Creed, in relation to the chief executive’s salary, applied from 2018 to 2020.
That situation led to the Comptroller and Auditor General Séamus McCarthy reporting that the IHRB was “not compliant” with the code of practice for the governance of State bodies.
He also said that when he looked for a copy of Mr Egan’s contract none was forthcoming. Mr McCarthy said it was his understanding the contract did not exist.
Mr O’Loughlin told the PAC about the contract: “Either it doesn’t exist, or it isn’t in our possession.” However, he also said he believed in the bona fides of those involved in Mr Egan’s golden handshake payment.
The IHRB is a private body comprising the Turf Club and the Irish National Hunt Steeplechase Committee that polices racing and is funded by a semi-State firm, Horse Racing Ireland.
