Beef Tribunal

From Wikipedia, the free encyclopedia
Jump to: navigation, search
Beef Tribunal
Date 31 May 1991 (1991-05-31) – 29 July 1994 (1994-07-29)
Location Dublin, Ireland
Also known as Tribunal of Inquiry into the Beef Processing Industry
Participants Judge Liam Hamilton

The Tribunal of Inquiry into the Beef Processing Industry, also known as the Beef Tribunal, was established on 31 May 1991, chaired by Mr Justice Liam Hamilton. It was set up to inquire into malpractice in the Irish beef processing industry, mainly centred on Goodman International, owned and controlled by Larry Goodman. It also examined accusations of special dispensations given by the then Minister for Industry and Commerce, Albert Reynolds, to Goodman.[1]

The Tribunal began hearings on 21 June 1991 and it reported its conclusions in July 1994, at the time the Republic of Ireland's longest-running inquiry.

Establishment[edit]

The Tribunal was established by the then Fianna Fáil/Progressive Democrat coalition, though only after the leader of the PDs, Des O'Malley threatened to pull out of the coalition if no inquiry was established. Then Taoiseach Charles Haughey acquiesced to the demand.

The Tribunal was tasked with "inquiring into the following definite matters of urgent public importance: (i) allegations regarding illegal activities, fraud and malpractice in and in connection with the beef processing industry made or referred to:-- (a) in Dáil Éireann, and (b) on a television programme transmitted by ITV on 13 May 1991; (ii) any matters connected with or relevant to the matters aforesaid which the Tribunal considers it necessary to investigate in connection with its inquiries into the matters mentioned at (i) above; and 2. making such recommendations (if any) as the Tribunal, having regard to its findings, thinks proper."[2]

The allegations[edit]

The Tribunal came weeks after the broadcast of a World in Action programme, and used the allegations in the programme as the basis for many of its inquiries.

World in Action[edit]

Abuses of the system under which subsidies are paid by the EEC[edit]

  • Falsification of documents which provide the basis for the payment of such subsidies
  • Use of bogus stamps to alter the classification of animals being processed
  • Switching of meat taken into intervention the property of the Intervention Authority and the substitution therefor of inferior product
  • Falsification of weights shown on cartons of beef

Abuses of the Export Refund subsidy system[edit]

  • Failing to comply with the contractual requirements of Middle-East customers with regard to Halal slaughtering of beef exported to such countries and the unauthorised use of Islamic stamps, in the possession of the Company, to show compliance with this requirement
  • Re-boxing of meat purchased from the Intervention Agency for the purpose of misleading customers

Abuses of the Aids to Private Storage Scheme at the AIBP factory in Waterford[edit]

  • Falsification of weights
  • Addition of poor quality meat
  • Attempting to conceal the extent thereof by

a) Altering case weights at the Cold Store b) Preparing a plan at Senior Management level within the Goodman Group to limit the extent of the damage to the Goodman Group which proved abortive

Allegations of Political Influence[edit]

  • That Larry Goodman and his companies had "the right connections at the right places that could basically control any investigation that would be put in place."
  • That, though the National Governments of each individual country are responsible for tackling fraud on the European taxpayer, Larry Goodman had, in the Irish Government, some of his strongest supporters.
  • That the links between the then Taoiseach, Charles J Haughey TD and Larry Goodman went "back a long way": that Larry Goodman gave money to the Fianna Fáil Party and the then Taoiseach publicly promoted Goodman at the very time that Customs investigators were warning that Goodman's operations were strongly suspected of involvement in fraud.
  • That a major European investigation into the operation of Goodman companies was prevented by assurances from the Irish authorities that they themselves had a wide ranging investigation of Goodman in hand and that there is no evidence of any such investigation.
  • That the Customs report on the Waterford investigation was withheld from the Garda Fraud Squad for a period of eighteen months even though the Customs authorities had recommended the instigation of criminal proceedings.
  • The Commissioner Ray Mac Sharry had sought the assistance of the Dutch Agriculture Minister, Herik Braks to approach a Dutch Bank, Amro, to withhold proceedings against Goodman.

Abuses of the Tax system[edit]

  • Having a company wide scheme of under the table payments to employees;
  • Making out cheques against bogus invoices, having same endorsed by Goodman employees, cashed at local branches of the Allied Irish Bank and the cash received distributed to employees, the amount involved being approximately £3 million per annum.

Allegations Referred to in Dáil Éireann[edit]

The allegations made in Dáil Éireann cover many of the allegations made in the television programme and may be summarised as follows and under the following headings:--

Abuses of the system under which subsidies are paid by the EEC to those engaged in the beef processing industry[edit]

  • Maintenance of an entire production line in Nenagh designed for taking stamps from frozen carcases and re-stamping and re-packing them, -- made by Deputy Pat Rabbitte on 15 May 1991;
  • Change of labels on meat in different parts of the country by a team moving about to do this job on behalf of Goodman companies, -- made by Deputy Tomas MacGiolla on the 9th day of March, 1989;
  • The removal and changing of stamps, dressings and labels on beef carcases in a plant on the 12/13 January 1989 seen by a journalist and notified to Department of Agriculture and Food, -made by Deputy Barry Desmond on the 12th day of April 1989;
  • Attempted use of South African Customs stamps to defraud the Department of Agriculture which resulted in the conviction of a close aide of Larry Goodman who was found in possession thereof, made by Deputy Dick Spring on the 15th day of May, 1991 and by Deputy Pat Rabbitte on 28 August 1990.
  • Illegal labelling of meat carcases in the Eirfreeze factory in the North Wall by changing labels and dates of slaughter on meat which resulted in the shut down of the plant by Inspectors from the Department of Agriculture and Food, made by Deputy Tomas MacGiolla on 9 March 1989 and on the 15th day of May 1991;
  • Carrying out grotty repackaging and restamping operations in Goodman plants in operations heavily subsidised by the Irish taxpayer, thereby putting Ireland's reputation for quality at risk, -- made by Deputy Pat Rabbitte on 24 May 1991.
  • Engaging in a Carousel operation, -- made by Deputy Pat Rabbitte on 24 May 1991.
  • Engaging in serious irregularities in connection with the operation of the 1986/87 Aids to Private Storage Scheme at plants in Waterford and Ballymun, made by Deputy Barry Desmond on the 19th day of March 1989 and by Deputy Dick Spring on the 15th day of May, 1991.

Failure of regulatory authorities and allegations of political influence in relation to alleged abuses of the system[edit]

  • The Department gave advance notice of inspections at meat plants and in particular at Foynes on the 15th and 16th day of April, 1989, made by Deputy Dick Spring on 28 April 1989.
  • Almost all of the samples taken in Foynes had trimmings in them or were otherwise suspicious, made by Deputy Dick Spring on 28 April 1989.
  • The regulatory authorities turned a blind eye on (Goodman's) dubious business practices—the false labelling and accounting, the commercial arrangements involved in the disposal of offal and so on. made by Deputy Dick Spring on the 28th day of August 1990.
  • The Department of Agriculture did not diligently assist the Garda Fraud Squad in relation to the Waterford and Ballymun investigations and ignored the request made for the release to the Fraud Squad of the Department's file in relation to the investigation, made by Deputy Dick Spring on the 15th day of May, 1991.
  • Notwithstanding their knowledge of the irregularities at Waterford and Ballymun and the prosecution of Mr Nobby Quinn in relation to the bogus South African stamps, the Department (and the Minister) was prepared to release bank guarantees of up to £20m (frozen because of the irregularities at Waterford) as part of the overall deal in the Examinership, made by Deputy Dick Spring on the 15th day of May, 1991.
  • The Department of Agriculture and Food and prosecuting Counsel seemed very reluctant to pursue the charges against Eirfreeze and AIBP with any vigour, on 30 July 1990 and in particular the issue of fraud and forgery about which the Garda were not informed, made by Deputy Tomas Mac Giolla on the 15th day of May 1991.
  • The regulatory and control procedures for the Irish Beef Industry are not satisfactory and in particular the Government have failed in their responsibility of rooting out those people who have turned the beef industry into an object of scandal and disgrace. The Government have covered up the illegal and improper activities in the beef industry since 1987, made by Deputy Spring on the 15th day of May 1991.
  • There was official indifference to the climate of fraudulent practices that characterised the Goodman group. According to one public official, the whole ethos was "do not interfere, do not make trouble, this man is doing a great job." If you hoped to be promoted the last thing you wanted to do was start shouting foul at Larry Goodman—made by Deputy Rabbitte on the 15th day of May 1991.
  • The Department failed to make proper arrangements to give Customs officials sufficient notice of export consignments to allow them to carry out detailed examinations made by Deputy Eamonn Gilmore on the 21st day of June 1990.

Tax evasion and Political influence in regard thereto[edit]

  • A great many Goodman workers were on the dole and were being paid under the counter, made by Deputy Pat Rabbitte on 15 May 1991.
  • Because of Goodman's political connections, the Revenue Commissioners turned a blind eye to the type of "remuneration packages" enjoyed by senior executives and a non-return of PA YE and PRSI to the Exchequer for many workers because of the operation of the contract system for a large proportion of the Goodman workforce—made on 28 August 1990 and repeated on 15 May 1991 by Deputy Pat Rabbitte.
  • In the Finance Act, the Government made a special arrangement to enable Mr Goodman to avail of high coupon finance (in respect of Section 84 loans) to fund speculative ventures abroad, made by Deputy Pat Rabbitte on 15 May 1991 and because of its use outside the State to fund speculative ventures, it amounted to tax evasion warranting prosecution.
  • Mr Goodman got special concessions in regard to tax from the Government. He got a concession of £4 million from the Revenue Commissioners, which was 50% of the tax bill he owed and which did not include interest, made by Senator Thomas Raftery in Seanad Éireann on the 29th day of May 1991.
  • In return for the Revenue Commissioners agreeing not to take proceedings against Mr Goodman or his company in respect of large scale tax evasion practices going back over many years. Goodman International paid the Revenue Commissioners £4 million in respect of all outstanding liabilities and penalties, a settlement which was by far the largest of its kind in the history of the State, made by Deputy Dick Spring, on the 15th day of May 1991.
  • The Government's support for Goodman included changes in the tax laws to enable a substantial amount of Mr Goodman's income from beef processing to be taxed at 10% manufacturing rate, made by Deputy Dick Spring on 18 August 1990.

Goodman, the Industrial Development Authority and political influence[edit]

  • The Goodman organisation was chosen as the hub around which Fianna Fáil had built its development policy for the food industry, including beef, dairying and sugar. Government funding commitments to him of between £200 and £250 million in 1987 had given him "tremendous credit" in raising finance wherever he wished to go and he had also received IDA grants of up to £25 million. The Taoiseach himself directly intervened with the IDA to drop the performance clause in the case of grants to the Goodman Company, made by Deputy MacGiolla on the 9th day of March 1989.
  • In June 1987 the Government decided against the wishes of the IDA to give £25 million to Laurence Goodman, made by Deputy Barry Desmond on 9 March 1989.
  • When Goodman applied for assistance for a Five Year Plan for the Beef Industry, the grant package was rushed through by the IDA under political pressure and was rushed through the Department of Finance under similar political pressure with the Taoiseach's own personal and improper interference, made by Deputy John Bruton on 24 May 1991.
  • Enormous political pressure from the highest possible level was brought to bear on the Goodman Group and the IDA to announce the expansion programme of 1987 before details had been worked out, solely as a PR exercise for the Taoiseach and his Government, made by Deputy Sean Barrett on 28 August 1990.
  • The decision on the part of the Government to rely solely on Goodman to develop the beef industry was downright irresponsible and was made at considerable expense to the taxpayer, made by Deputy Sean Barrett on the 18th day of December, 1990.
  • The entire board of the IDA at one stage threatened to resign over this grant to expand an industry that already had a surplus processing capacity, made by Senator Thomas Raftery on 29 May 1991.

Abuse of Export Credit Insurance Scheme[edit]

The allegations in regard to this aspect of the Inquiry were made by Deputy Desmond O'Malley, Deputy Pat Rabbitte and Deputy Dick Spring and may be summarised as follows:--

  • The provisions by the State of Export Credit Insurance cover on the sale of beef to Iraq in 1987 and 1988 of an amount in excess of the amount actually exported was: (i) in breach of the leans of die Export Credit insurance Scheme: and (ii) constituted a substantial abuse amounting to a fraud on the taxpayer, the scale of the abuse and of the potential liability of the State being unprecedented, made by Deputy Desmond O'Malley on 10 May 1989.
  • The provision in 1987 and 1988 of between one fifth and one third of all Export Credit Insurance cover available with over 80% going to Goodman: (i) amounted to abuse of the scheme, and (ii) excluded fair competition from within the State which aggravated the scandal, made by Deputy Desmond O'Malley on 10 May 1989.
  • Allowing just two companies, of which by far the larger and more substantial was Goodman, cover, under the Export Credit Insurance scheme for beef exports to Iraq, so considerably in excess of their actual exports to that country, was an act of blatant favouritism and had the effect of strengthening further the already strong position of Goodman (to whom members of the Government were extremely personally close) as the dominant group within the beef processing and allied trades, contrary to the interests of farmers and employees and of exporters in other business sectors, made by Deputy Desmond O'Malley on 10 May 1989.
  • The decision taken in 1987 by the Fianna Fáil Government to reinstate Export Credit Insurance was taken against the best professional advice available to the Government, made by Deputy Dick Spring on the 28/8/1990 and reported on by him on 15 May 1991 and by Deputy Pat Rabbitte on 24 May 1991.
  • In respect of Goodman's Export Credit Insurance Policy declarations were made that only beef with its origins in the Republic of Ireland would be covered, nevertheless very large quantities of non-Irish beef were included in shipments purporting to be covered by that policy, made by Deputy Desmond O'Malley on 28 August 1990.
  • Conscious decisions were taken to give one conglomerate (Goodman) more than 80% of the available cover in that market, disadvantaging rivals and exporters in other products, made by Deputy Rabbitte on 24 May 1991.
  • The granting of Export Credit Insurance was a political decision and depended on whether "you were a member of the club" and Mr Goodman, when he heard that Halal had been granted a slice of the Export Credit Insurance, intervened with the Taoiseach who caused the Minister for Industry and Commerce, Albert Reynolds TD, to cancel the allocation of such insurance and to inform the Chief Executive of Halal, made by Deputy Rabbitte on 15 May 1991.

Allegations of political influence[edit]

In addition to those set forth herein, further allegations were made in Dáil Éireann as follows:--

  • The extraordinary recall of the Dáil and Seanad in August 1990 had as much to do with the integral link between Fianna Fáil and the Goodman organisation as it has with protecting a key Irish industry: made by Deputy Rabbitte on the 28th day of August 1990.
  • The Companies (Amendment) Bill, 1990 represented only Goodman's third choice proposal, arising from meetings held with the Taoiseach, the first being a £300 million rescue package which Mr Goodman demanded the Government should underwrite, the second involving an approach by Mr Goodman's friends in Cabinet to the EC Commissioner, Mr Mac Sharry in an attempt to persuade him to bring forward an EC plan that would be of similar assistance to Mr Goodman but which would be cosmetically packaged as being in the interest of the total industry: made by Deputy Rabbitte on 28 August 1990 and repeated on 15 May 1991.
  • Goodman successfully intervened with the Taoiseach to cause the Government to reverse a decision to increase the budget to be given to CBF the meat marketing board, in 1988, in order to shut out the prospect of markets being expanded for his competitors, made by Deputy Rabbitte on 25 October 1990.
  • Charles Haughey publicly promoted Goodman. At the very time the Customs investigations were warning that Goodman's operations were strongly suspected of involvement in fraud, the Irish Prime Minister was endorsing Goodman for millions in Irish and European grants: made by Deputy Spring on 15 May 1991.
  • There was political interference in the work of Agricultural Officers and Customs men in attempting to investigate suspected breaches of EC regulations: made by Deputy Pat McCartan on 24 February 1988 and by Deputy Tomas MacGiolla on 9 March 1989.
  • It has been suggested that Goodman was subjected to a lesser degree of Customs inspection than other commercial operations (especially in regard to container loads going North) and that he was able to virtually close off the port of Greenore to other people when he was exporting meat: made by Deputy Rabbitte on the 15th day of May 1991.
  • Goodman had been allowed to "cherry pick" the best of the ICC property portfolio, because he was on the "inside political track" before any other party became aware of these properties: made by Deputy Pat Rabbitte on 28 August 1990.
  • Knowing the inside political track had enabled him to get access to exceptional lines of credit and to benefit from risky but profitable Middle East contracts, confident in the knowledge that he was guaranteed by the Government so long as Fianna Fáil remained in power: made by Deputy Pat Rabbitte on 28 August 1990.
  • Fine Gael's attitude to Goodman was uncommonly acquiescent, a consideration affecting their attitude being the receipt of a donation of £60,000 from Goodman in 1988, made by Deputy Pat Rabbitte on 15 October 1990.

References[edit]

  • Tribunal of Inquiry into the Beef Processing Industry (9 August 1994). Report (PDF). Official publications. Pn.1007. Dublin: Stationery Office. Retrieved 20 November 2013. 

Footnotes[edit]

  1. ^ Byrne, Elaine (2012). Political Corruption in Ireland 1922-2010, A Crooked Harp?. Dublin, Ireland: Manchester University Press. ISBN 9780719086885. 
  2. ^ http://thestory.ie/2012/04/02/the-beef-tribunal-report-1994/

External links[edit]