Vol. 402 No. 7
6 Mr. McCartan asked the Minister for Industry and Commerce if he intends to introduce any legislative or regulatory measures in the light of the report of the liquidator of Merchant Banking; and if he will make a statement on the matter.
Since taking office, I have been endeavouring to have the Companies (No. 2) Bill, 1987, which was first introduced in the Seanad in May 1987, enacted. In this regard, Report Stage consideration of the Bill was commenced in this House on 24 October 1990, and I proposed to try to ensure that it is completed with the least possible delay.
This Bill will update those areas of company law which, since the enactment of the main Companies Act, 1963, have been shown to be less than effective in dealing with problems which have arisen in the company law area. I am satisfied that in the many new provisions contained in the Bill, in particular those dealing with investigations in Part II, winding-up in Part VI, and disqualification and restriction of directors and other officers in Part VII, we will have the necessary legislative provisions to tackle most problems which may arise in the company law area in the future, including those of the kind which arose in the company referred to by the Deputy. The important point now is to have the Bill enacted without any undue delay.
I concur entirely with the Minister on the last point about the urgency of enacting the Companies Bill, but will he confirm in the House whether, under the mechanism of appointing an inspector, he can hold out to the 590 depositors, some of whom lost their life savings, redundancy money and so on, the hope of retrieving some of the losses? Will he appoint such an inspector when the Bill is enacted?
The normal way to retrieve losses of depositors or other creditors would be by the appointment of a liquidator. In this case a liquidator was appointed. He acted as such for a number of years and he got very little indeed in the way of assets of which there were very few. He reported to the High Court that he could get no more and, I understand, he was not in a position to pay a dividend. This was after two years. Therefore, an inspector would certainly not be in a better position to retrieve any moneys. I note, though, in the case referred to by the Deputy that in Northern Ireland as a result of a criminal prosecution brought by the authorities there the defendant in that case, who, I understand was the managing director of the company concerned, contributed a sum of £500,000 towards the losses that had been incurred by the Northern Ireland depositors. A criminal prosecution here might have brought about some contribution towards the losses of the depositors and other creditors, but the Director of Public Prosecutions here decided recently not to institute such a prosecution.
A brief question. I wish to make some progress on other questions.
What then did the Minister mean when he told The Sunday Tribune of 23 September 1990 that he intends “appointing an inspector in the High Court to examine the affairs of the Gallagher Group with a view to prosecution in the hope of regaining some of the moneys lost to the investors”?
Deputy Rabbitte, I have to say that quotations at Question Time are not in order.
I apologise——
I do not think that is a very exact rendering of what I would have said. In any event, I could not appoint an inspector until this legislation that I have referred to, the 1987 Bill, was passed. The procedure for appointing inspectors under the——
The paper reported that the Minister intended to get——
At that stage the criminal proceedings in Northern Ireland were not over and it was hoped that some further contribution towards the losses might be forthcoming from the defendant in the case concerned. That has subsequently provide not to be the case, and if they were unable to get any further moneys in Northern Ireland I think it is probably a good deal less likely now that we would be able to get a contribution towards the losses here.
