The Flood Tribunal this week was hearing evidence about a payment made to politician Mr Ray Burke, which according to builders Mr Tom Brennan and Mr Joe McGowan who made it from their Jersey offshore company, Canio, was openly described as a political donation. But yesterday accountant Mr Hugh Owens, who advised on the two builders' offshore tax schemes, told the tribunal that if they had told him that money was going to a politician it would have 'stuck out like a sore thumb'. If a political donation had been mentioned - even if Mr Burke's name was not used - he would have remembered it, he said.

Told that Mr McGowan had also claimed he informed his accountant about the donation, Mr Owens responded: 'Do you believe everything Joe McGowan says?' Mr Owens also said auctioneer Mr John Finnegan, also involved in making the donation, had been 'totally deceived' and 'hoodwinked' in relation to the political donation. As far as he was concerned, Mr Finnegan was a 'sleeping partner' in the land deals he collaborated on with Brennan and McGowan. Mr Owens said he did not keep Mr Finnegan informed of the details of the deals because the auctioneer was 'coming along on a cheap ride'.

Mr Owens said there was 'no tax reason' for the elaborate offshore financial arrangements he designed on the trio's behalf. The reason for the structure was his clients' desire for 'privacy', he said. The involvement of Brennan and McGowan and Mr Finnegan in a number of offshore companies had been concealed through the use of shares held in trust by their solicitors. The names of the three owners did not appear in any of the company documents.

Mr Owens explained that the reason he recommended this arrangement was because offshore companies were involved.

Meanwhile, over at the Moriarty tribunal, former minister for transport, energy and communications, Mr Michael Lowry, told the tribunal he did not interfere at any level in the process of awarding a mobile phone licence to Esat Digifone in 1996. But it emerged yesterday during a four-hour grilling of Mr Lowry by Mr Jerry Healy SC that he has been formally cautioned in relation to his financial affairs by the Revenue Commissioners.

Mr Lowry made reference to that fact while being questioned about an offshore account set up in his name in 1996 by his friend, the late Mr David Austin, a Fine Gael fundraiser, who had lent him money in a private transaction. During his evidence, Mr Lowry said he was very conscious of the presence in the body of the tribunal of officials from the Revenue Commissioners with whom he was dealing and with whom he was 'under caution'.

'I think I must have some constitutional right in relation to the evidence I give on taxation matters, particularly in regard to the fact that information already given at this tribunal has been used against me in another forum.'

Responding to the submission, the chairman, Mr Justice Moriarty, said that the tax affairs of Mr Lowry were not within the remit of the tribunal, but the circumstances which had arisen had made it 'essential' that the tribunal inquire 'with some particularity' into all the circumstances over this period. Insofar as some tax considerations might obtrude, the tribunal had to examine these 'overall circumstances' carefully.

During questioning, Mr Lowry repeatedly said he did not believe the account set up in his name in Irish Nationwide (Isle of Man) in late September 1996 was 'relevant' to his accountants, his solicitors or the Revenue at that time. He had received no benefit from it, and the money had been repaid, with interest, just over three months later. When he had realised that it was relevant, he disclosed it to the tribunal in April this year.

A sum of (pounds) 147,000 was transferred to the account by the late Mr Austin in 1996. Mr Austin obtained a draft in his own name from his account with Bank of Ireland in Jersey and sent that draft to an official at the Irish Nationwide (IOM) for lodgment to Mr Lowry's account, the tribunal heard.

The money, Mr Lowry repeated yesterday, was intended for use for the refurbishment of the house at 43 Carysfort Avenue, Blackrock, Co Dublin. It was a loan, at commercial rates. Yet the handwritten document drawn up by Mr Austin in October 1997, bearing the details of the loan, was a private document, which Mr Lowry kept in a personal file. It was 'an agreement between friends', he said.

Counsel however said that the circumstances surrounding the setting up of a bank account in the Isle of Man by Mr Michael Lowry in 1996 indicated that he was intent on keeping the account secret.

The contract for the Irish Nationwide account listed the address of Mr Lowry’s accountant in Blackrock, Co Dublin without their consent. He also listed his occupation as a company director when, in fact, he was a Government minister at the time. And Mr Lowry had written on the contract that there should be no correspondence in relation to the contract without his request.

Counsel for the tribunal, Mr Jerry Healy SC, told the inquiry that there was "no possible, credible reason for David Austin to put money in the offshore account for any other reason other than to keep it secret".

Asked about the payment of $50,000 to Fine Gael at the time of the award of the license to Esat, Mr Lowry, who was ultimately responsible for the award of the license, said he knew nothing about how it was raised or about how it was paid. He believed such a payment from any of the companies competing for a State mobile phone licence in late 1995 and early 1996 would have been both "wrong and unwise".

The tribunal has previously heard that a payment of $50,000 was made by Telenor, a partner with Mr Denis O'Brien's firm, Esat Telecom, in the Esat Digifone company, to an offshore account in Mr Austin's name.