THE Law Society was warned by the National Crime Agency not to jeopardise its investigation into the £1bn sale of Nama's Northern Ireland loan book minutes before representatives were due to appear before a Stormont committee to be questioned about the scandal.
The NCA launched an investigation earlier this month into sensational claims surrounding the north's Nama property deal, including that a £7 million payment made to Belfast law firm Tughans that found its way into an offshore bank account.
A dispute over the payment and how it should be allocated is understood to have led to the abrupt departure of Ian Coulter, its managing partner.
The Assembly's Finance and Personnel Committee was told that a deputy senior investigating officer of the NCA, referred to as Richard Birmingham, called Katherine McKay, head of professional conduct of Law Society Northern Ireland at 10.45am today, 15 minutes before she and three other Law Society members were due to be questioned.
He told her that the Law Society, which regulates solicitors, should not answer questions in relation to the ongoing investigation with respect to the payment to Tughans and Ian Coulter's subsequent departure.
The message was put in writing after a request to the NCA from committee chair Daithi McKay.
It read: "Around our correspondence, we would be happy for you to say should you wish that LSNI are cooperating with NCA in this matter and we are mutually keen to ensure that the integrity of the criminal investigation is protected.”
Committee member Máirtín Ó Muilleoir said it was getting "a bit silly" with the NCA ringing witnesses and "telling them not to co-operate".
The Irish News understands that the NCA, which has met both the Law Society and Stormont committee, is also concentrating its investigation into the involvement of businessman Frank Cushnahan as an advisor to a failed bid for the Nama portfolio by Pimco, a rival US investment company.
Mr Cushnahan was due a £5 million payment from Pimco, as was Tughans' former managing partner Ian Coulter, according to Nama chairman Frank Daly. Mr Cushnahan had previously sat on Nama's Northern Ireland advisory committee and was therefore potentially conflicted. Pimco informed Nama that it would pull out of the bid once the discovery was made.
Members of the Stormont committee, chaired by Daithí McKay, today became increasingly exacerbated by the Law Society's inability to answer questions about the £7m payment made to Tughans.
The Law Society, which launched its own investigation in January, answered some general queries on the operation of the society and regulatory matters but to many questions said it could not answer or could not comment.
Arleen Elliott, president of the law Society, said that a "vigorous and indepth" investigation was ongoing, concerning the circumstances of Ian Coulter’s departure from Tughans.She confirmed that the £7m funds are secured until the Law Society investigation reaches a conclusion.
In a heated exchange, McKay asked the Law Society: "do you think you can come in here and pull the wool over our eyes and the eyes of public? It will intrigue the public that there seems to be a stonewalling from particular corners in this case. There has been a shut down from particular corners. The Law Society needs to be more transparent".
Mr James Cooper, a Law Society council member of the Law Society, said: "We are very confident that when the facts emerge, after the investigations... that our role will be vindicated and that we will be found to have regulated appropriately and robustly".
The Law Society could not confirm if and when it reported the matter to the police.
The committee responded by saying it would consider recalling the Law Society as it could not understand how answering such a question could interfere with any investigation.
The Irish News understands the Law Society contacted the police in early July, more than five months after Tughans first alerted it to the £7m transfer to the Isle of Man and the subsequent departure of Mr Coulter.
The Law Society would not provide a timescale as to when it expects its own investigation to conclude.
The watchdog for solictors has faced criticism over its handling of the £7m controversy after initially refusing to confirm that it was carrying out an investigation.
Daithí McKay expressed surprise that the NCA had approached a witness advising it how to interact with the committee minutes before its representatives were due to answer questions. He said the committee would again ask the NCA to appear for questioning.
The committee added that it would consider hearing from Jamie Bryson after the prominent loyalist wrote offering assembly members the evidence he claims to hold.
