Dublin City Council has parked an investigation into how public money was used for protection racket payments, citing a garda investigation into the issue, the Herald can reveal.
Since September 2016, council officials were aware that a notorious gang led by criminal Derek 'Dee Dee' O'Driscoll was providing 'security' at a public housing site in Cherry Orchard.
That arrangement was raised in court by the Criminal Assets Bureau (CAB) last October when it succeeded in freezing bank accounts containing more than €250,000 controlled by O'Driscoll and an associate, David Reilly.
However, the council's response to the scandal has been shrouded in secrecy.
It refused to disclose the outcome of the 2016 investigation, launched after the Herald revealed the payments.
Last year, the council's most senior official, chief executive Owen Keegan, urged councillors not to hold a meeting to discuss the matter.
At the time he said he had "grave reservations" about the meeting "while the matter is under investigation by the city council and external agencies".
The meeting was eventually cancelled.
In November, Housing Minister Eoghan Murphy appointed senior counsel Patrick Butler to investigate the allegations.
His investigation was completed in December and has been passed to the Office of the Attorney General "to seek legal advice on publication and next steps".
This was due to its "complexity" and an ongoing garda investigation, the department said.
However, the council has now confirmed the investigation announced five months ago is no longer under way.
"The internal team has been stood down pending completion of these separate investigations," a statement said.
"The city council is not in a position to give any further information on this matter."
City councillor Mannix Flynn, who has tabled questions to Mr Keegan about the progress of the internal investigation, expressed anger at the council's actions.
"We were not told about the decision about the internal report and this raises very serious questions for the council and officials," he said.
"On whose authority was this report shelved? The executive has a responsibility to the elected members here. This is public money we are talking about.
"Why was this report shelved? When was that decision taken?"
Mr Flynn said there was a lack of clarity about the current garda investigation.
In December, a senior employee of the council was arrested as part of the probe.
The 61-year-old, who worked in the council's housing department, was questioned at Clondalkin Garda Station before being released without charge.
He was previously quizzed by the CAB, along with a now retired council worker, in relation to money being paid over to the mobsters but was not arrested on that occasion.
Notorious criminal Dee Dee O'Driscoll has multiple previous convictions including for bribing a garda, violent disorder and perverting the course of justice.