He is one of nine prominent dissidents facing charges arising from secret recordings of two alleged meetings of the terrorist gang’s “army council” organized by double agent Dennis McFadden.

INLA leaders in Derry, who have a moody relationship with the new IRA, exploded when they read the claims.

They are furious that the rival gang has once again linked its members to the drug trade.

Mediation was needed between the groups earlier this year when each accused themselves of taxing drug dealers in spray-painted graffiti around Derry.

“INLA leaders were furious when they read the drug traffickers’ allegations in the newspaper,” a Republican source told Sunday Life.

“They said the New IRA has a brass neck because its young members were seen snorting cocaine at a trendy downtown bar.”

Publicly, the INLA and the New IRA oppose drugs, but privately members of both gangs tax drug traffickers.

In February, in an obvious search of its rival, the New IRA spray painted graffiti all over Derry, claiming it was not protecting drug traffickers.

The INLA responded by spray painting the names of suspected drug traffickers it accuses the new IRA of taxing.

Mediators had to be called in to settle the dispute, fearing it would turn violent.

The INLA, which is led by veteran Republican Martin McMonagle, is the strongest in the Ballymagroarty area of ​​Derry, while the base of the new IRA is in the Creggan estate.

Earlier this year, the PSNI raided a business unit in the city, unearthing £ 80,000 worth of cocaine and a substantial sum of money in a house in the Bogside.

Photographs obtained by Sunday Life show senior INLA members at a party at the premises the previous week with a major drug figure. It was these images that started the graffiti war with the New IRA. Although tensions between the gangs have calmed down in recent months, they have been rekindled by claims made about the INLA during leadership meetings of the new IRA wiretapped by MI5.

An alleged member of the New IRA has been recorded saying about the INLA: “If you look at them badly, there are 10 on your doorstep the next day and they will hit you.”

Republican sources say these conversations, which were made public during Gary Hayden’s bail application, are just the tip of the iceberg and more embarrassing claims will follow.

“Everyone at these New IRA meetings is just whimpering and chatting about other Republican groups,” the insider added.

“The transcripts, when they go to court, will be subject to some reading.

“Those involved will have explanations to give. “