North-south crackdown on IRA's hidden wealth

Police on both sides of the Irish border have stepped up their pursuit of IRA money and assets with a large-scale search and seizure operation centred on the South Armagh area.

The exercise, one of the largest of its kind staged, is part of an intensive investigation into a local farmer Thomas "Slab" Murphy. He is regarded by the authorities as a key figure in charge of IRA finances.

Gardai in the Republic arrested two men and a woman believed to be in their 50s and 60s during the operation which involved up to 400 security personnel. Mr Murphy was not among the people arrested.

Police said they had removed 12 vehicles and seized £200,000 cash, in sterling and euros. They also found more than 20,000 cigarettes and a substantial amount of fuel.

The attention being devoted to Mr Murphy is in marked contrast to the pattern of most of his long republican career, since he used to attract surprisingly little harassment from police in Northern Ireland or in the Republic.

He has never been convicted of any offence, though years ago he suffered a legal blow when he humiliatingly lost a libel case against a newspaper which had accused him of IRA involvement. He has repeatedly been named as a senior IRA member, holding positions such as chief-of-staff, northern commander and director of operations. As such, he has been a vital figure in republicanism in terms of controlling the money flow and in exercising a supervising role.

In the south those deployed in yesterday's operation included specialists in investigating fraud and smuggling, with customs officers and others. In the north, two Army helicopters and troops gave cover as early-morning searches involved local police and the organised crime branch.

A spokeswoman said the searches were in connection with "a major intelligence-led investigation into suspected money-laundering, fuel-laundering and organised crime." Police visited a business premises in the town of Crossmaglen and the city of Newry.

In the south, a major impetus for targeting Mr Murphy and other republican figures has been provided by the Justice Minister, Michael McDowell. He has made a political priority of pursuing republican assets which are said to run into many millions of pounds.

In Northern Ireland, police and the Assets Recovery Agency have been attempting to unearth caches of deeply concealed IRA money. Last October, the investigation into Mr Murphy's activities led to extensive searches in Manchester where republicans were said to have established a major property portfolio designed to launder illicit funds.

Mr Murphy said those "vilifying" him were hoping to scupper attempts to build peace in Ireland. His Sinn Fein MP Conor Murphy said Mr Murphy was being unfairly accused of being involved in criminal activity.

A farm said to belong to Mr Murphy has entrances and exits on both sides of the border, which authorities say is perfect for a lucrative smuggling trade involving cattle, diesel and other commodities.

Alex Attwood, the moderate nationalist politician, backed the operation and said: "The threat of organised crime recognises no borders. Any crime boss or foot soldier must know there is no hiding place for them on the island."