Fitzwilton explains giving £30,000 cash cheque to Ray Burke

Magill submitted a list of questions on May 25 last to Mr Kevin McGoran, chief executive of Fitzwilton plc in connection with the £30,000 transfer by way of a cheque made payable to cash to Mr Ray Burke on June 7, 1989. Matheson Ormsby Prentice, solicitors to Fitzwilton plc replied on May 26 last. The reply in full states:

We refer to your fax yesterday addressed to Fitzwilton. We are instructed to reply on his behalf and on behalf of Fitzwilton. By way of preliminary comment on your letter, we would make the following points:

(a) Fitzwilton has consistently supported the democratic process in Ireland through contributions to the main political parties. In 1989 the group made a £30,000 donation to the Fianna Fáil party in relation to its election expenses. This contribution was acknowledged by Fianna Fáil. No political favours were sought or offered in return for this contribution.

(b)Fitzwilton plc did not make a £30,000 payment to Ray Burke. (Two representatives of Fitzwilton subsidiaries), made a contribution to Fianna Fail on behalf of Fitzwilton and its subsidiaries.

(c) Our client rejects the suggestion that Mr Burke enquired of (the Fitzwilton representatives) if he were free to dispose of the cheque as he wished or was told that he could do so. We are instructed that (the Fitzwilton representatives) asked Mr Burke to whom the cheque should be made payable. Mr Burke requested that it be made out to cash as he wished to defray some constituency expenses and pay the balance to the party's head office. It was always understood by Fitzwilton that the great majority of the money would be paid over to Fianna Fáil headquarters for its election expenses.

(e) (The subsidiary) were reimbursed by inter-company transfers from Fitzwilton and (another subsidiary) at the end of June 1989.

(f) Our client believes that Fianna Fáil party head office was most probably informed that Fitzwilton and its subsidiaries would be contributing £30,000 to the party's general election expenses.

(g) On 3 August 1989 Fitzwilton received from Fianna Fáil head office an acknowledgement of a “ very generous” donation to its election fund.

With regard to your specific questions, our client answers as follows:

Q1 Why did Fitzwilton make a £30,000 payment to Mr Ray Burke in June 1989?
A1 Fitzwilton did not make a £30,000 payment to Ray Burke in June 1989. The payment was made to Fianna Fáil through Ray Burke.

Q2 Who in Fitzwilton authorised the payment to be made?
A2 The payment was within the authority of the chief executive.

Q3 Was Mr Tony O'Reilly, the chairman of Fitzwilton, aware that the payment was made?
A3 Absolutely not.

Q4 Why did representatives of Fitzwilton agree to make this payment by way of a cheque made out to “ cash” ?
A4 Mr Burke requested that the cheque be made payable to cash to facilitate the use of part of the proceeds for his constituency expenses in Dublin North, with the balance being paid to Fianna Fáil head office.

Q5 Who in Fitzwilton were aware that the payment had been made by the way of a cheque made out to “ cash” ?    
A5 (The two representatives of Fitzwilton who visited Mr. Burke.)

Q6 Was Mr Tony O'Reilly aware at any time that this payment had been made by way of a “ cash” cheque?
A6 Absolutely not.

Q7 How did Fitzwilton treat this payment in its accounts?
A7 The payment was recorded in the accounts of the company in the appropriate     manner.

Q8 Why, having made a commitment to make a payment of £30,000 to the Fianna Fáil party, did Fitzwilton instead wish to make the payment to Mr Burke?
A8 The payment was intended for the Fianna Fáil party's general election expenses and the use of a portion of it for Mr Burke's constituency expenses was suggested by Mr Burke.

Q9 Why did the representatives of Fitzwilton inform Mr Burke that he was free to dispose of the £30,000 as he wished?
A9 They did not so inform Mr Burke.

Q10 Did Fitzwilton receive a receipt for the £30,000 payment and, if not, did it seek a receipt for this payment?
A10 Yes, as mentioned above (see paragraph (g)).

Q11 Why was the payment made through a subsidiary company?
A11 (The subsidiary) was Fitzwilton's only Irish operating subsidiary at the time. (The other subsidiary) had been acquired within the previous week. Fitzwilton's main operators were based in the UK at the time (it had an annualised turnover of over £400,000,000).

Q12 Why, when the controversy arose last year over the payment of another £30,000 to Mr Burke in June 1989, did Fitzwilton not disclose this further payment of £30,000 to Mr Burke?
A12 As far as Fitzwilton was concerned, the payment was to the Fianna Fáil party and was acknowledged as such.

Q13 What other payments has Fitzwilton made to individual politicians?
A13 Over the years, Fitzwilton plc has made contributions to all the main political parties through their representatives.

Q14 If Mr Burke is the only politician to whom such a payment was made, why     was he singled out for such payment?
A14 Mr Burke was not singled out for an individual payment. It was Mr Burke who suggested the exact mechanism in relation to Fitzwilton's 1989 contribution to Fianna Fáil.

At very short notice, just prior to going to press, Magill submitted a list of supplementary questions to Fitzwilton concerning this payment. No reply was available in the short time at hand.
1. Why, if Fitzwilton wanted to make a donation to Fianna Fáil, did it not pay the money directly to the Fianna Fáil party office or to the person then raising funds for Fianna Fáil, Mr Paul Kavanagh?
2. In what manner precisely was the £30,000 cheque payable to cash treated in the (subsidiary company) accounts and later in the Fitzwilton accounts?
3. Fianna Fáil states that a receipt was issued to the (subsidiary company) for the £10,000 it received—the £10,000 was stipulated on the receipt. In the statement on behalf of Fitzwilton submitted to us it is stated that the acknowledgement was for a “generous donation”. Arising from that, may I enquire:
a. What precisely did the acknowledgement on the receipt state?
b. If the receipt or the acknowledgement was for £10,000 from the (subsidiary company) did Fitzwilton enquire why the full donation was not acknowledged?
c. Was Fitzwilton in any way concerned that not all of most of the £30,000 had gone to Fianna Fáil and, if so, what did it do about that?