Over the past year or so, I’ve been questioning the motivations of those who claimed to fight for “Irish freedom” a century ago. It seems to me that we have made a complete hash of independence, and it also seems to me that the two parties who slugged it out in the civil war cared little for the ordinary citizen, but were more concerned with personal gain of power and money.
There were many crooks, many cynics, many con-artists, many opportunists, but if anyone exceeded the example of Joe McGrath, I have yet to hear of it.
There was no more spectacular instance of cynicism, dishonesty and avarice than this crook, a former torturer and strike-breaker, who used the war of independence as a springboard to defraud thousands of people around the world, and to drag the good name of Ireland through the mud. After the civil war, McGrath’s Irish Hospital Sweeps became a vehicle for enriching him, his family and his cronies, to the extent that some of his fellow Old IRA men in Ireland, Britain and the USA became obscenely rich. McGrath himself acquired unimaginable wealth, and became one of the most powerful men in Ireland, capable of intimidating government ministers, including the famously irascible Des O Malley.
Showing an early propensity for dishonesty, McGrath orchestrated many bank robberies on behalf of the IRA during the war of independence, keeping a slice of the proceeds for himself. During the civil war, he headed the CID, an intelligence unit responsible for torturing and assassinating political opponents. Later, he was the principal adviser to Siemens-Schuckert, the company which constructed the Ardnacrusha hydro-electric scheme, and which was subsequently defaulted on by the Irish government. McGrath, as adviser, provided the gang of thugs who kept the workers docile as the project proceeded.
The Sweep, as it was popularly known, was a lottery, based on the winning horses in a selection of races. All of my parents’ generation were fixated on the notion of winning the Sweep, a magic solution to all their problems.
The lottery was ostensibly set up to raise funds for Irish hospitals, but was in fact a private company designed to make Joe McGrath and his two bookie accomplices, Richard Duggan and Spencer Freeman, very rich men indeed.
In their first lottery, the three crooks pocketed £46,000 — the equivalent of about €500,000 today, though these things are hard to measure.
Directors of the Sweepstakes were directors of many other Irish companies besides, and the dirty money went on to fund other sizeable Irish operations, including Waterford Crystal and the Glass Bottle Company, which was recently the subject of further controversy. There seems to be no end to the tangle of questionable Irish business interests.
The underlying legislation permitting it was deliberately so full of holes that McGrath and his two cronies paid no tax on their earnings. Furthermore, only about 10% of the money raised ever went to the hospitals, with the rest flowing into the pockets of the former freedom fighters in Ireland and across the world who operated the scam. Despite this, McGrath somehow contrived to have nurses and Gardai drawing winning tickets from the drums, lending a spurious credibility to his fraud.
The motivating factor for those who bought tickets was the staggering size of the prizes, but even that was an illusion. McGrath and his criminal associates set up a system to approach people who had bought potentially winning tickets, in order to buy them back at a fraction of the price. In other words, they offered poor people cash in return for relinquishing their chance to win a fortune. The ticket was never cancelled, of course, and the McGrath operation duly collected the winnings when the horse romped home.
Freeman’s brother, Sidney, was in charge of a parallel operation to scam the system. Based in his office in the Ritz Carlton Hotel, Freeman received details of the horses drawn in Dublin, sent to him by coded telegram. Using this information, he contacted American winners and offered to buy a share in their tickets for a substantial amount. In 1936, Sidney Freeman managed to acquire a half share in eight winning tickets, the profits of which were shared with the directors of the Sweeps.
The real genius lay in realising how desperate the Irish state was for money, much like today. Even though only 10% of the profits went to hospitals, it was still more than the government could afford. Therefore, any minister questioning the scam was vulnerable to pressure, as Des O Malley found out. Whatever his failings, O Malley’s honesty has never been in question. He was a fervent opponent of the Haughey tendency in Fianna Fáil, and in the Seventies, as Minister for Justice, asked for information about the funding of the Sweeps. As Minister, he was responsible for signing an order approving every draw, and he wanted to know more about the money before he signed the next one. The response was immediate pressure on government from members of the McGrath family. Jobs would be lost in the Sweepstakes, O Malley was threatened. Thousands of jobs. Even if O Malley could contemplate it, his cabinet colleagues would not.
It was blackmail of an Irish government minister by a relative of a criminal.
Little did O Malley realise what was happening the thousands of Sweeps tickets. Little did the American authorities realise how they were helping the fraud by impounding ticket stubs as associates of McGrath attempted to smuggle them back to Ireland, or not, as the case may be. Lotteries were illegal in the States, and therefore the US Customs had the authority to seize the Sweepstakes tickets bound for Ireland. This they did, in their thousands, but of course, the money had already been collected in an operation run by fellow patriots, and was on its way back to McGrath, less the substantial slice due to the Stateside contacts — Joseph McGarrity, a former member of the IRB, and Connie Neenan, his fellow-IRA member. Those in the know spoke of one plane so overloaded with sacks of money, it barely managed to take off from JFK
And the people who had paid for the tickets? Simple. The Feds took ’em. Sorry.
Therefore, it made great sense to tip off the authorities about ticket stubs, which McGarrity duly did. Every dollar ticket caught by the US authorities was a dollar in his pocket.
If you ever saw The Sting, you understand the scam.
A great Irish journalist, Joe MacAnthony (grandson of Francesco Marcantonio from Belfast), wrote an article in the Irish Independent, exposing the corruption at the heart of the Hospitals Sweepstakes. As a result, all advertising on the paper was withdrawn for two months. Some time after that, a planned RTÉ programme researched by Charlie Bird was scrapped after pressure was applied to the authority.
They haven’t gone way, you know. You think Fianna Fáil held the power in this country? Think again.
For his trouble, MacAnthony was frozen out of his job, first in the Independent and subsequently in RTÉ. He moved to Canada, reared a family and continues to write stuff annoying the status quo. Three years after arriving there, he wrote an exposé of the Canadian security service. The difference between Ireland and Canada immediately became obvious, with the Canadian authorities launching an investigation, while the Sweeps continued to defraud credulous people all over the world, without interference from the Irish government.
A man with an irrepressible sense of fun, MacAnthony got his own back on the small-minded Sir Tony O Reilly and on McGrath by returning from a gambling trip to Atlantic City with a suitcase full of dollars and instructing his children to roll in the money, which they gleefully did.
McGrath, in the style of all Mob bosses, went on to become a leading racehorse owner, and left a vast fortune to his heirs.
A vast stolen fortune.
Following in Joe’s footsteps, Damian Corless has published a book called The Greatest Bleeding Heart Racket in the World.
Buy it and read it.
UPDATE: Where did the Sweeps Millions Go?