Dáil loans

The Dáil loans were bonds issued in 1919–21 by the Dáil (parliament) of the self-proclaimed Irish Republic to raise the Dáil funds or Republican funds, used to fund the state apparatus the Republic was attempting to establish in opposition to the Dublin Castle administration of the internationally recognised United Kingdom of Great Britain and Ireland. The subscribers were Irish nationalists, in Ireland for the Internal Loan and in the United States for the External Loan.

"Dáil funds case" redirects here. It is not to be confused with Sinn Féin Funds case.

Raising of loans

When Michael Collins was appointed Minister for Finance in the Dáil Ministry on 2 April 1919, the First Dáil authorised him to use anti-conscription funds raised in 1917–18, "Republican Bonds", and other funding.[1][2] The Dáil approved the First Dáil Loan on 19 June 1919.[3] This was for £500,000, half in an Internal Loan raised in Ireland, half in an External Loan raised in the United States ($1.25m at an exchange rate of $4.50 to the pound).[4][5] Both were oversubscribed, and the External limit was increased in August 1919 to $25m.[6] The money raised was held in bank accounts in Ireland and the United States controlled by three trustees: Éamon de Valera, President of Dáil Éireann; Michael Fogarty, the Catholic Bishop of Killaloe; and James O'Mara.[3][7] £25,000 worth of gold was buried in concrete in Batt O'Connor's garden.[8] On 27 March 1920, Alan Bell, a resident magistrate investigating bank accounts linked to the Dáil, was taken from a tram and shot by Collins' IRA "Squad".[9] The Second Dáil on 26 August 1921 approved the Second Dáil Loan of £500,000 internal and $20,000,000 external,[10] which was launched in America on 15 October 1921 and raised $700,000 before being suspended after the Anglo-Irish Treaty of 6 December 1921.[11] About $2,500,000 of the total of $5,800,000 raised in America had been sent to the Dáil Ministry in Ireland by then.[11]

Internal loan

The Cork Examiner was closed by the military authorities in 1919 for publishing the prospectus of the internal loan.[12]

Origin of internal loan subscriptions[13]
AreaAmount (£)
Connacht57,797
Munster171,177
Leinster87,444
Ulster41,297
Great Britain and France11,647
Cumann na mBan801
Total370,163

External loan

Patrick McCartan was appointed ambassador to the United States by the First Dáil. De Valera went on a fundraising tour of America from June 1919 to December 1920. O'Mara went to the United States in September 1919 and liaised with the Friends of Irish Freedom.[14] O'Mara fell out with de Valera over management of the funds and resigned his post in May 1921.[14] De Valera replaced him with his brother Stephen M. O'Mara.[11] The amount raised by the first loan was about $5,100,000 external and £375,000 internal.[2][11]

Reimbursement of funds

The Dáil split over the Treaty and the pro- and anti-Treaty factions agreed to freeze the bank accounts until the situation was resolved. The Irish Civil War of 1922–23 was won by the forces of the Irish Free State established under the 1921 treaty. The Free State Oireachtas' Dáil Eireann Loans and Funds Act, 1924 vested the Dáil loan funds in its Minister for Finance.[15] In 1925, the Free State courts released the Dáil funds in Irish bank accounts to the Free State Executive Council, which undertook to redeem the bonds. As regards Dáil funds in bank accounts in the United States, bondholders were divided between the "Hearn Committee", led by de Valera supporter John J. Hearn, and the "Noonan Committee", led by Bernard Noonan.[16] Noonan felt the Free State should control the funds and redeem them; Hearn argued they should preferably go to Sinn Féin as leaders of the rump Irish Republic, or failing that be returned to subscribers. In 1927, the Supreme Court of New York ruled against Noonan, on the basis that the Free State was successor to the United Kingdom but not to the Irish Republic; it further ruled that the funds should be returned to subscribers, as "the purpose for which the moneys were subscribed by the so-called bondholders, that is, the establishment of a Republic of Ireland free and independent of any allegiance to Great Britain, was never accomplished".[17] De Valera, now leader of the opposition Fianna Fáil party, urged his American supporters to use their refunds to invest in The Irish Press newspaper. The Executive Council refused to allow the trustees to implement the New York court decision until after the 1932 general election, when the first Fianna Fáil government took office. Repayment was "effectively completed" by 1936,[18] under the Dáil Eireann Loans and Funds (Amendment) Acts of 1933[19] and 1936.[20]

References

Sources
  • Carroll, Francis M. (2002). Money for Ireland: Finance, Diplomacy, Politics, and the First Dáil Éireann Loans, 1919-1936. Greenwood Publishing Group. ISBN 9780275977108. Retrieved 11 October 2015.
  • Doran, Michael A. "The National Loan 1920; Michael Collins and the Democratic Revolution". generalmichaelcollins.com. Collins 22 Society. Retrieved 19 October 2015.
  • Dickinson, Edwin D. (1927). "The Case of the Irish Republic's Funds". The American Journal of International Law. 21 (4): 747–753. doi:10.2307/2188482. ISSN 0002-9300. JSTOR 2188482.
  • Evans, Gary (February 2012). "The Raising Of the First Internal Dáil Éireann Loan and the British Responses to it, 1919–1921" (PDF). Theses. Maynooth University. Retrieved 19 October 2015.
  • Kelly, Stephen (Winter 2011). "The Sinn Féin millionaire: James O'Mara and the first American bond-certificate drive, 1919-1921". New Hibernia Review. 15 (4): 9–28.
  • McCarthy, Andrew (2006). "Michael Collins; Minister for Finance 1919–22". In Doherty, Gabriel; Keogh, Dermot (eds.). Michael Collins and the Making of the Irish State. Mercier Press Ltd. pp. 54–69. ISBN 9781856355124. Retrieved 22 October 2015.
  • O'Donoghue, Daithi (26 March 1951). "Setting up and financing of the Offices of the First and Second Dail Eireann". Witness Statements. Bureau of Military History. No.548. Retrieved 12 October 2015.
  • Robbins, David (June 2006). "The Irish Press 1919-1948: Origins and Issues" (PDF). Theses. Dublin City University. Retrieved 19 October 2015.

Citations
  1. "Financial Proposals". First Dáil debates. 2 April 1919. Retrieved 13 October 2015.
  2. McKenna, Joseph (2011-02-17). Guerrilla Warfare in the Irish War of Independence, 1919-1921. McFarland. p. 34. ISBN 9780786485192. Retrieved 13 October 2015.
  3. "Finance — trustee deed". First Dáil debates. 19 June 1919. Retrieved 11 October 2015.
  4. "Finance — loan prospectus". First Dáil debates. 19 June 1919. Retrieved 11 October 2015.
  5. "Finance — Form of Application, 1919 Issue (Internal)". First Dáil debates. 19 June 1919. Retrieved 11 October 2015.
  6. "MINISTERIAL MOTIONS. - FINANCE". First Dáil debates. 20 August 1919. Retrieved 11 October 2015.
  7. "Finance — appointment of trustees". First Dáil debates. Oireachtas. 19 June 1919. Retrieved 13 October 2015.
  8. Ní Dheirg, Iosold (2008). "The Dáil Loan". The Story of Michael Collins. Mercier Press Ltd. pp. 47–53. ISBN 9781856355957. Retrieved 19 October 2015.
  9. Carroll 2002, p.10
  10. "Issue of Loans". Second Dáil Éireann debates. 26 August 1921. Retrieved 13 October 2015.
  11. Kelly 2011, p.25
  12. Dempsey, Pauric J. "Crosbie, George". Dictionary of Irish Biography. Cambridge University Press. Retrieved 27 November 2015.
  13. Evans 2012, p.70
  14. Humphreys, Joe (23 May 2013). "Millionaire helped finance War of Independence". The Irish Times. Retrieved 16 October 2015.
  15. "Dáil Eireann Loans and Funds Act, 1924". Irish Statute Book. Retrieved 13 October 2015.
  16. Carroll 2002 pp.50–51
  17. Irish Free State v. Guaranty Safe Deposit Co., 129 Misc., 551 (New York Supreme Court 11 May 1927).; Garner, J. W. (October 1927). "A Question of State Succession". The American Journal of International Law. 21 (4): 753–757. doi:10.2307/2188483. JSTOR 2188483.
  18. Kelly 2011, p.26
  19. "Dail Eireann Loans and Funds (Amendment) Act, 1933". Irish Statute Book. Retrieved 13 October 2015.
  20. "Dáil Eireann Loans and Funds (Amendment) Act, 1936". Irish Statute Book. Retrieved 13 October 2015.
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