AIB's former Group Internal Auditor, Tony Spollen, has told the DIRT inquiry that he believes the scale of the bank's DIRT problem was too big for the Revenue Commissioners to have agreed to write off tax arrears back in 1991. This afternoon the Revenue produced documentary evidence of contacts it had with AIB last year, in which it claimed that the bank had a major liability for DIRT arrears. This undermined an earlier claim by AIB that the Commissioners had been silent on the matter for much of last year after the story broke first broke in the media.
Witnesses for AIB and their auditors, Price Waterhouse Coopers, were questioned closely at the DIRT inquiry about the contacts with the Revenue Commissioners. They are being asked about meetings before and after publication of the Sunday Independent article in April of 1998, which stated that the bank had £600m in bogus non-resident accounts.
Allied Irish Bank made contact with the Revenue Commissioners four times last year, amid controversy over media reports on bogus non-resident accounts. Two of those meetings were with the former and current chairmen of the Revenue Commissioners, and the other two were with tax inspectors. Mary Walsh of Price Waterhouse Coopers was told about these meetings by AIB officials. She prepared a file note on the whole issue.
However, after evidence given by AIB witnesses yesterday, she accepted that her note was wrong. She said that she had confused the various meetings and recorded them incorrectly. It was her presentation of a revised note to the inquiry last night that sparked controversy. The Chairman Jim Mitchell believed that it could have amounted to a change in evidence and he recalled all the witnesses before the committee today.
He now accepts that was not the case, but the committee has continued to question Ms. Walsh and AIB on the matter. AIB still maintains it had a deal with the Revenue, dating back to 1991. Witnesses said that seven years later, when the issue broke into the public domain through newspaper articles, they went back to the revenue. They said that they were still not pursued for the back tax until further media reports, late last year, sparked off the current DIRT scandal.
