Irish Cabinet minister denies fraud claims

A former European Union commissioner and Irish cabinet minister testified yesterday that he does not know how 50,000 Irish punts (£42,000) he received in a secret donation ended up in a bogus offshore account.

A former European Union commissioner and Irish cabinet minister testified yesterday that he does not know how 50,000 Irish punts (£42,000) he received in a secret donation ended up in a bogus offshore account.

Padraig Flynn told a seven-year-old judicial inquiry into corruption in Ireland's political system that he gave the cheque from a property developer, Tom Gilmartin, to his wife, Dorothy, in 1989 but never found out where she deposited it - nor did he ever ask her.

The investigation, led by Justice Alan Mahon, has already determined the account used by the Flynns was registered to a fictitious London address, a device that allowed them to evade hefty income and deposit taxes on the secret payment. Mr Flynn, one of several politicians from Ireland's dominant Fianna Fail party implicated in corruption and tax-dodging, insisted yesterday that the money had been used to reimburse him for legitimate election expenses.

At a previous hearing, Mr Flynn's legal team claimed that he spent just 12,000 punts on the June 1989 election, when he was re-elected a Fianna Fail MP for Co Mayo.

But Mr Flynn said yesterday that, while he had no receipts to back up any of his expense claims, politics was "a very expensive business". He insisted that he never knew where his wife deposited the cheque.

Justice Mahon said that he found it hard to believe Mr Flynn's version, noting that the sum was virtually the same as his annual salary in 1989.

Mr Flynn also denied that the payment from Mr Gilmartin had been invested in other offshore investment funds with the help of his daughter, Beverly Cooper Flynn, a lawmaker who has already been expelled from Fianna Fail for her role in the affair.

Mr Gilmartin, a prospective developer of a Dublin shopping mall, alleges that he paid Mr Flynn - in a cheque made payable to "cash" - specifically in the hope of getting approval for his project. The mall was never built.