Fine Gael statement adds to payment confusion

Denis O'Brien has categorically denied making or arranging a payment of £50,000, $50,000 or any similar amount to Fine Gael while the party was in government in late 1995 or early 1996.

Meanwhile Fine Gael has indicated that the party has so far failed to effect the return of the donation money, despite attempts to return it to Telenor and Esat, and says the money only reached the party in May 1997.

Former Esat Telecom chief executive O'Brien, in his statement, says the donation of $50,000 was made by the Norwegian company Telenor - with whom East Digifone won the second mobile licence in 1995 - to Fine Gael through former Smurfit executive, the late David Austin, who Fine Gael acknowledges assisted it with fundraising.

Denis O'Brien says David Austin approached him in December 1995 about a Fine Gael fund-raising event in New York. He declined to attend. In a statement, he says he instead put Austin in touch with Telenor who wanted to develop political contacts independently of Esat.

As the controversy over the payment escalated today Telenor's Dag Vangsnes confirmed to RTE that Telenor made a payment of $50,000 to Fine Gael - but maintained it was on behalf of Esat, which did not have the money at the time.

O'Brien's statement says Telenor subsequently sought reimbursement from Esat Digifone, which was initially refused but finally paid around April 1996.

Two years later Telenor sent Esat Digifone a cheque for £33,000, saying it was a refund from Fine Gael. O'Brien understood that cheque was returned to Telenor and he had no knowledge what happened to it afterwards.

Fine Gael says the donation was received in May 1997 as part of its fund-raising for the general election, in the form of a personal cheque drawn on David Austin's account at the Bank of Ireland in Baggot Street Dublin.