Charles Haughey, the former Prime Minister of Ireland, who died in June, exploited his position to maintain a lifestyle that allowed him to buy racehorses, yachts and his own private island, according to a report into his finances.

A combination of cocaine, call girls and cash for favours led to the establishment of the Moriarty tribunal, which, after nine years and at a cost of £15 million, yesterday published a 600-page report into Ireland’s most controversial leader, who was given a state funeral six months ago.

The report confirmed what Ireland had already suspected, explaining the yawning chasm between Haughey’s relatively modest state salary and his acquisition of racehorses, yachts, handmade French shirts and a well-stocked wine cellar in his Georgian country mansion.

Haughey claimed to have “done the State some service” when he retired from politics. However, the tribunal concluded that Haughey had generated for himself an undeclared income of nearly £8 million, equivalent to about £30 million today. That amount represented 171 times the value of his prime ministerial salary and pension between 1979 and 1996.

It included a sum of £42,000 paid in 1985 to one of his private bank accounts by a Saudi diplomat in connection with the granting of Irish passports to relatives.

The tribunal also found that Haughey had plundered funds raised for an operation for Brian Lenihan, a friend and Cabinet colleague, who was suffering from cancer. A total of £226,000 was raised for a liver transplant in the United States but only £60,000 was spent on the treatment.

“The tribunal is satisfied that a sizeable proportion of the excess funds collected was misappropriated by Mr Haughey for his personal use,” Mr Justice Michael Moriarty ruled. The judge, who began investigating Haughey’s financial empire in 1997, said that the former Prime Minister’s testimony had often been incredible and that his report would have been published years ago had the disgraced Fianna Fail leader and his legal team not obstructed his efforts to track the course of funds through third parties and offshore accounts.

Mr Moriarty said that his investigators had found several examples of when Haughey’s receipt of money in exchange for favours amounted to corruption, and concluded that the exploitation of his position of power to enrich himself was “unacceptable, wrong and must not be replicated”.

The report concluded: “Apart from the almost invariably secretive nature of payments from senior members of the business community, their very incidence and scale — particularly during difficult economic times nationally, and when governments led by Haughey were championing austerity — can only be said to have devalued the quality of a modern democracy.”

The tribunal said that Haughey’s most generous donor, the department store baron Ben Dunne, had received lobbying support from Haughey in his company’s successful battle to avoid paying £35 million to Ireland’s tax collection agency.

Mr Dunne gave more than £1.3 million to Haughey, but his clandestine generosity was revealed after the supermarket boss was caught in Florida with a prostitute and a bag of cocaine, and he began to leak details of secret offshore accounts and senior politicians in a desperate attempt to maintain control of his business empire.

Throughout the course of the tribunal’s work, Haughey treated it with contempt, claiming to have forgotten key meetings with donors and seeking to blame his dead accountant for all his ills, implying that he was far too important to keep an eye on his wealth.

The tribunal also discovered that Haughey was nearly £1 million in debt to Allied Irish Banks when he first became Prime Minister and that friends paid off some of it while the outstanding balance was ignored.

Haughey died of cancer in June. It later emerged that he had planned his state funeral in detail. One long-time ally said that he was “wearing the smile of old devilment” as he lay in his open coffin.

Rise and fall

Haughey died in June this year, aged 80