THE OBSERVER (London)
Sunday 3rd May 1998
Going gets too hard for racing’s fast set
For years Charles Haughey has concealed his dealings with Ireland’s top stud farm owner. But with the courts in hot pursuit, he’s riding for a fall.
By Cal McCrystal and David Connett in Fethard
- THE VILLAGE of Fethard lies in Ireland’s ‘Golden Vale’, so called because of its lush pasture and fine livestock. On one side rises the 3,200-ft Sliabh na mBan or Mountain of the Women about which expatriates the world over are inclined to croon; and on the other, which rises more gently, is 2,000 acres of prime land known as Coolmore or Big Quiet Place where mawkish sentiment is noticeably absent and silence is as golden as the vale itself.
Coolmore is a stud with an extraordinary reputation for breeding champion racehorses. Such is its roster of stallions, all the leading race-horse breeders have to be its customers including the Queen, the Aga Khan, and even those oil-rich horse-racing obsessives, the Maktoums of Dubai, with whom the Coolmore people enjoy an uneasy rivalry.
It is absolutely the world’s pre-eminent nursery of thoroughbred talent. It is also at the centre of an unprece-dented controversy affecting world breeding practices, tax exemptions and dealings with Irish politicians while sitting as government Ministers. Un-imaginable sums are involved in Coolmore’s activities.
Coolmore is run by John Magnier, one of the richest men in Ireland that is, when he is in Ireland. Much of his time is spent abroad as a tax exile. In Fethard (pronounced feathered), a community of 1,400 people in South Tipperary which has derived economic benefits from Coolmore’s fame, Magnier is known as ‘The Boss’.
Among his friends and frequent clients is Charles J. Haughey, also known as ‘The Boss’ from his years as Ireland’s Taoiseach (Prime Minister). Haughey whose Gaelic surname, Eachaidhe, means ‘horseman appointed the taciturn Magnier to the Irish Senate (the second parliamentary chamber) in 1987, a move which was greeted with considerable surprise. Magnier shares with Haughey a passion for both horseracing and mystery. He spoke only three times in his three years in the Senate and, even now, refuses to talk to the press. Not once, for example, has he been quoted on demands that the enormous tax exemptions the Irish stud industry enjoys as a result of legislation introduced by Haughey be revoked. Haughey, too, once the roguish Irish leader, revered by his closest aides as Il Duce, has always fought against self-disclosure -as even now he fights judicial probes into the questionable origins of his personal fortune.
Haughey and Magnier became acquainted through race meetings and connections within Haughey’s party, Fianna Fail, in the early 1970s. Since 1985, most of Haughey’s mares were serviced by Coolmore stallions, though what if any fees were charged is unknown. Coolmore, boarding the best stallions in Ireland some the best in the world charges fees ranging from £10,000 to £120,000. The syndicate has all but cornered the flat-race stallion market in these islands, dominating three-quarters of the Irish market alone.
Among these connections is Haughey’s married daughter, Eimear Mulhern, who chairs the Irish Thoroughbred Breeders Association. As a bloodstock agent she has business ties with John Magnier. Magnier, meanwhile, is the son-in-law of Vincent O’Brien, the famous Irish racehorse trainer, himself a member of the Coolmore syndicate.
In 1990, 11 Irish passports were granted to the Saudi racing and breeding enthusiast Sheikh Mahfouz and his family in return for a promise to invest £20 million in Irish job-creation schemes. Haughey personally presented the passports to the sheikh over lunch in the Taoiseach’s grand man-sion at Kinsealy, north of Dublin.
Because the official certificates for them had yet to be signed by the responsible Minister, the handover was in breach of regulations. Only £17 million of the sheikh’s promised £20 million can be traced as having been invested as planned. But £4 million of the £17 million which was invested ended up in a chain of tennis clubs in Britain, in which the biggest shareholder is John Magnier.
Informality, or carelessness, appears to be at the heart of frustrated judicial attempts to locate 150 files missing from the Irish Department of Finance. Five relate to the period when Haughey was Finance Minister, and are believed to relate to exchange-control issues. Following a tribunal request for the files, the Department of Finance says it had searched 12 buildings for them, to no avail.
However, enough is already known about Charles Haughey’s irregular behaviour to embarrass some former friends. Last year, for example, he was found to have accepted as Taoiseach £1.3 million from an Irish supermarket chief, Ben Dunne. Having for most of his life vaulted over seemingly impossible hurdles, Haughey today is unhorsed. In the villages around Coolmore he is no longer seen as ‘a player’. If that is so, then his cosy relationship with what the Irish magazine Magill calls ‘the really big fellas’ may soon he over.
His friend John Magnier, worth at least £100 million, spends more and more time abroad at his homes in Switzerland and Spain or in the coral mansion in Barbados which he calls ‘Laughing Waters’, but which has been nicknamed ‘Gatwick’ because of its enormous size. He will see Haughey less frequently than before. Besides, he will need all his time and acumen to maintain the gilt on the Golden Vale.
Last week Haughey’s bid to prevent Judge Moriarty’s judicial tribunal investigating his financial affairs failed in the Dublin High Court. The judge said that, given his former position and ‘the nature and amounts’ of the gifts he received while in office, ‘he cannot complain that he is, in some way or other, being discriminated against.’ Haughey, 72, recently fell off one of his horses, injuring his leg. At a recent tribunal appearance he hobbled with a stick.
Last week the Irish journalist Vincent Browne one of Haughey’s most combative
challengers down the years wrote: ‘It is hard not to sympathise with him in the travails he is undergoing.’
The Observer last week investigated Coolmore’s operations and the Magnier-Haughey relationship, as murmurs of concern spread through Ireland not least in a recent issue of Magill, which Browne edits. Ursula Halligan, who wrote the article, ‘The Senator and the Taoiseach’, faced a wall of silence from rival stud owners and locals in Fethard.
Others have used words like ‘paranoia’ regarding Coolmore’s security. In Fethard, it is almost impossible to hear anything but praise for Magnier and his stud-owning syndicate another founding member of which was the British breeder and pools millionaire Robert Sangster.
Sangster has now pulled out, but still has interests there. Asked if he ever gave money to Haughey, Sangster, speaking from a hotel in Melbourne, said Initially he ‘didn’t want to get involved in all that’. He added that ‘In Britain It wasn’t unusual for people to contribute to the Conservative Party’, but he did not want to ignite (in Ireland) the same sort of controversy that surrounded Tony Blair on the Formula One tobacco sponsorship issue.
But one young Fethard businessman volunteered: ‘There’s a lot of people who don’t like Coolmore’s monopoly.’ Fethard has 10 pubs, two churches and an Augustinian friary. At the friary, elderly Father John Meagher spoke affectionately of John Magnier, his syndicate and his famous horses, among them Danehill, Sadler’s Wells, Fairy King and Royal Academy. ‘Mr Magnier is a very fine gentle-man, the priest said. ‘You should see his place it’s like a city where they speak only in millions.’
Coolmore straddles a Tipperary road, has a ‘security checkpoint’ and a receptionist behind a marble horseshoe desk surrounded by exquisite paintings and sumptuous fur-niture. The stud’s own stallions have their individual star waiting rooms specially designed chalets with their names carved above the door. The visiting mares also receive lavish treatment. The receptionist told The Observer ‘You can’t see around without an escort only by prior appointment.’ However, an expensively produced brochure and other publicity literature describes Coolmore as ‘probably the pre-eminent stallion station in the world’ and associate the Magnier family with ‘a long sequence of top-class stallions including Cottage, Fortina, Wrekin Rambler, Even Money and Deep Run’. There are 50 stallions under Coolmore management in Europe, Japan, the United States, South America and Australia. The company occupies, in all, 6,000 acres and employs 600 people 200 of them from Tipperary.
In McCarthy’s Hotel, on Fethard’s main street, the owner’s son, Vincent Murphy, proudly recalled a celebration in 1985 when the Sangsters and the O’Briens attended a baptismal knees-up for John Magnier’s baby son.
‘Mr Haughey was at that party here, as well as Andrew Lloyd Webber,’ who has a home, Kiltinan Castle, down the road ‘Frank Sinatra’s manager Danny Schwartz, and the Irish international rugby team. There was a competition to see who could drink the most Black Velvet [Guinness and champagne).’ As some guests drank themselves into oblivion, the popular group The Dubliners sang ‘Black Velvet Band’. One imbiber-reveller died a short while afterwards.
When it comes to leader-ship, breeding has long been Ireland’s preoccupation. After Haughey first came to power in 1979, the then leader of the Opposition, Garrett FitzGerald, referred to the new Taoiseach’s ‘flawed pedigree’. But questions of pedigree have also preoccupied Haughey himself.
In 1962, earning £3,700 a year as Minister for Justice, he bought the first in a long line of racehorses. Later, as Minister for Finance, he began sending his mares to a stud in Co Dublin owned by Captain Tim Rogers, a former aide-de-camp to Winston Churchill. Haughey held shares in most of the stallions at the Rogers stud and in 1968 bought a stud in Co Meath. A year later, as Finance Minister, Haughey introduced tax exemptions for the horse-breeding industry when Britain was scrapping them. It has also been established that Rogers made ‘financial contributions’ to Haughey in the late 1960s.
The Coolmore syndicate’s success really swelled in the mid-Seventies, when it devised a strategy of identifying colts which would become future champion racehorses. Cheaper to buy as yearlings, they were then trained into big winners and, subsequently became valuable stallions.
Thus, for the first time, Magnier, Sangster and O’Brien created a merger of the bloodstock and horse-racing industries. Rich American bloodlines were introduced. To make the new system failsafe they decided to buy up all the best yearlings, increasing the chances of winning races and consequently breeding more and more winners. They maximised the scheme when bloodstock values collapsed temporarily in the mid-Eighties.
By the 1990s Coolmore had created the greatest stand of stallions in the world, with branches in North America and Australia. Magnier began to shuttle his stallions to and from Australia, thereby doubling their performance. His animals cover, on average, 25 per cent more mares than do English standing stallions. In 1997, for example, Sadler’s Wells, Magnier’s greatest possession, covered 163 mares, each at a fee of 120,000 Irish pounds. The joy in the ‘Stallion Shuttle’ lies in the fact that, since Coolmore benefits from tax-free status, its overseas operations, using Coolmore-based bloodstock, also qualify for Irish tax exemption.
This is seen both in Australia and other countries not to mention small Irish stud owners as giving Coolmore an unfair advantage. What it gains in tax it can spend on buying more and more stallions. It is impossible to measure the full extent of Magnier’s wealth. ‘The Boss’ controls a web of interlinked companies in Ireland, the Isle of Man, Switzerland, the Dutch Antilles and the Cayman Islands. But making sense of all of these is like extracting answers from The Other Boss.
Whether or not Haughey can be persuaded to disclose his financial shenanigans with a host of business people while he held high office de-pends on Ireland’s stomach for seemingly interminable and costly judicial probes. But to quote Haughey himself when defending his government in a bugging scandal what has emerged so far is truly ‘grotesque, unbelievable, bizarre and unprecedented’.
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