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Words: 534
Publication: The Racing Post (London, England)
ISSN: 0968-3364

THE AGA Khan has directly accused his former stud manager in Ireland of perpetrating a "massive fraud" against him.

The Aga made the allegations against Ghislain Drion in a sworn affidavit read out yesterday in Dublin's High Court during the latest stage of the action brought against him by Mary Charlton, a secretary at the Aga's Irish studs for 27 years.

The affidavit was sworn by the Aga as the sole director of his bloodstock holding company, the Studs Societe Civile, which is being sued by Charlton.

Charlton, also Drion's secretary until his resignation in 1998, is seeking orders that she is entitled to continue her employment, that an internal inquiry into alleged misconduct be declared unlawful, and that she be awarded damages.

The Aga's counsel also made allegations against Charlton during yesterday's hearing, claiming that she did not have "clean hands" in response to a claim from the plaintiff's counsel that she should still be receiving a full salary.

The Aga had been required to swear an affidavit to explain the shredding of the 'Coulton memorandum', a document considered crucial to the case.

In the section of the affidavit pertaining to Drion, the Aga said: "The instructions which I gave to Frank Faughnan as soon as Mr Drion's massive fraud was discovered were that he should identify the persons involved in the fraud on the company in Ireland or elsewhere, ascertain the extent and recover any losses."

Faughnan is the personnel manager at the Irish studs, and has certain responsibilities for security. His investigations were detailed in the Coulton memorandum, which the Aga said, in his affidavit, he had personally shredded.

Ercus Stewart, Charlton's senior counsel, complained that part of the memorandum was missing when he originally obtained an order for its discovery.

Stewart read out what he had assumed to be the final paragraph of the document, prepared by chartered accountant Richard Coulton on June 18, 1998, and given to the Aga Khan.

It said: "I [Coulton] think that Mr Drion has been very lucky to get away with his actions for so long. However, he has been supported by a secretary who appears to have been at least passively, if not actively, in league with him.

"He has managed to mislead the auditors, employ a low-quality accounts clerk, confuse your stud staff or coerce them to obey him."

Stewart took exception to the suggestion, but Roddy Horan, the senior counsel representing the Aga Khan's SSC, had earlier made allegations against Charlton when addressing the judge, Justice Declan Budd.

Horan said: "Your Lordship has been asked to direct my client to pay the plaintiff's salary until the trial but the plaintiff is not coming to equity with clean hands - computer file deletions, use of my client's stallions, and she has had associations with Mr Drion since these things erupted in court." He added there was "no continuing obligation to pay the plaintiff her salary at this juncture".

In his affidavit, the Aga denied having given any instructions for the termination of Charlton's employment.

The judge expressed his hope that the motion stage would be concluded today. But he added: "I have given up hope of the case finishing within the promised time."

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