Report into the Granting of Irish passports to Sheikh Khalid bin Mahfouz and his associates prepared by Mr Dermot Cole, assistant secretary in the Irish Department of Justice. This report is in the public domain and was reprinted in the The Irish Times on 6 October 1997.
Section A: Investments
1. In correspondence with the then Minister in August 1990 solicitors acting for the Mahfooz (sic) family enquired about citizenship in exchange for investment. They spoke of up to $ 100 million being available for investment. They gave an outline of the background of the Sheik and supplied a banker's reference from Citi Corp/Citibank signed by the vice president of the bank describing Sheik Mahfooz as an enormously wealthy individual, the most important and respected client with Citicorp Private Bank in the UK and Channel Islands and one of the most valued clients of the bank globally.
2. Following phone calls to the Minister's Office from the solicitors I met with Mr Mitchell (Sheik Mahfooz's solicitor) and the Sheik's personal assistant (whose name I do not recall) on 3 September, 1990. I recall that they told me of the interest of the Sheik in obtaining Irish citizenship in return for investment and that the Sheik had that day purchased (pounds) 10 million worth of Irish gilts as an earnest of his good intentions.
3. For my part I explained the Government position regarding investment and handed over the "statement of intent". I told them that the Government was interested in investment of the type outlined in the statement and that while the investment in gilts would be appreciated they should understand that such investment could be resold the following day with no lasting benefit to the Irish economy. I advised them to make contact with Mr Colm O'Regan of the IDA (then seconded to the Department of the Taoiseach) as the person who could best advise on the various investment options open to the Sheik and who could put them in touch with relevant IDA personnel.
4. Mr Sean Donnelly, now Executive Director of Forbairt, then Executive Director of the IDA, tells me on the following day, 4 September 1990, Mr O'Regan referred the enquiry to the IDA.
5. The IDA introduced Mr Noel C Duggan of Millstreet to the potential investors in September, 1990; heads of agreement on investment in the Millstreet complex were signed in October, 1990; an investment of (pounds) 2 million was made in December 1990/January 1991. Some time after that almost a further (pounds) 1 million was invested in Drushane Castle, an associated enterprise of Mr Duggan's.
6. The IDA was not involved in the decision to grant naturalisation to the investor in December, 1990. On file is a fax copy of a letter from the principal investor to Deloitte Touche, dated 7 December, 1990, promising investment of (pounds) 20 million. Throughout 1991 the IDA presented a number of investment opportunities to the potential investors, none of which were accepted by the potential investors as being suitable.
7. Concerning the (pounds) 10 million purchase of Irish gilts mentioned to me on 3 September, 1990, I have contacted the Department of Finance and the Central Bank in an effort to establish (1) whether this purchase was in fact made and (2) if so whether the gilt holding was maintained (in light of the failure of other investment options). The Central Bank act as agents of the Minister for Finance in maintaining a register of the holders of gilts, but under the terms of the Central Bank Act are precluded from disclosing the names of the holders of gilts unless directed to do so by the Minister for Finance.
8. So far, therefore, it has been possible to account through the IDA for (pounds) 3 million of the (pounds) 20 million (stg) stated to be available for investment.
9. Filed under is a copy of the "Statement of Intent" in use in September, 1990.
Section B: Issue of Passports
1. The Minister in her request for an enquiry asked specifically whether the passports were issued prior to the certificates of naturalisation being signed.
2. As Mr Mathews (then Secretary) states, he did obtain from the Department of Foreign Affairs passports for the 11 individuals on 7 December, 1990, i.e. the day before the naturalisation certificates were signed. He apparently passed those passports, along with unsigned naturalisation certificates, to the then Minister on 7 December. The passport applications were witnessed by an English banker on 5 December 1990.
3. I have obtained from the Department of Foreign Affairs a copy of a minute written to the Ambassador in Riyadh on 9 January, 1991, confirming that the passports were prepared on 7 December, 1990.