Dáil Éireann debate -
Thursday, 9 Dec 1993

Vol. 437 No. 1

Adjournment Debate. - Furniture Sales: Fraud Allegation.

Mr. G. Mitchell

I thank you, a Cheann Comhairle, for having selected this matter this evening. I had been seeking a way to raise the matter again since the Minister for Justice, in the course of Question Time on 25 November last, replied to my first priority question, saying that she was not sure whether the information available to her was up to date. Certainly, judging from the reply she read out in the House, her information was not in keeping with that available to me.

I have been informed that an English company has conducted sales of furniture from hotels and other venues nationwide. Their method of operation is to display a container load of high class furniture, advertised as liquidation stock, take deposits from customers and then disappear. I am informed that the Garda have received many complaints about the activities of this company. In cases of this nature the Garda experience difficulty in proving fraud because the relevant law is antiquated and on many occasions the Garda have to tailor charges to fit that antiquated law. For example, if legislation obtained here along the lines of the British Thefts Acts of 1968 and 1978 their task would be rendered much easier. I have a list of 58 recommendations made by the Special Committee set up to report on fraud which reported almost two years ago but whose recommendations have not been implemented.

I was informed by the Garda that in relation to this particular company they have received approximately 40 complaints from places as far apart as Dublin, Wicklow, Drogheda, Athlone, Sligo, Roscommon, Salthill and Ennis, and there may be others. There seems to be some conflict between the information available to me and that available to the Minister in relation to this matter, but I am quite happy that the information available to me is reliable. First of all, I received the information from sources outside the Garda, based on a number of complaints from people around the country. A number of local interests in both Ennis and Sligo have been in touch with me directly about the matter, as have some other public representatives. When I approached the Garda in preparation for this debate and asked whether this information was correct I was informed that up to 40 investigations are taking place in those areas. The Minister, in reply to a parliamentary question, told me she had no information about this and, if I had information, would I kindly supply it to her. Since then I have been endeavouring to establish which of us is wrong.

Second, in relation to this case, but also in relation to cases in general, it is my understanding that if the Garda suspected that, say, X, Y or Z building society, or whatever other financial institution one might care to imagine by way of example, was trading fraudulently, taking deposits fraudulently, there is nothing the Garda can do about it, even though they may suspect there is impropriety, and must await receipt of a complaint or complaints before they can investigate. Of course, this means that by the time they receive a complaint and investigate, the bird will have flown the nest.

My second query is: why have the recommendations of the Special Advisory Committee set up by the Government to examine fraud not been implemented? We should remember that the reason that advisory committee was established in the first place was that I and others had been seeking the establishment of a serious fraud office here.

I went to London and met the director of the fraud office there. The reply from the former Minister was: "maybe we do not need a serious fraud office here, we will set up a committee". That committee made 58 recommendations including the setting up of a national bureau of fraud investigation. If that bureau had been in place this alleged fraud and many proven or attempted frauds, could be investigated in a timely fashion. Normal business people would not object to the Garda through the fraud squad or the National Bureau of Fraud Investigation — if it was set up — going in to establish companies' bona fides if they had suspicions.

In relation to the specific question, will the Minister state whether my information is correct? When will she implement the findings of the committee dealing with fraud?

Minister for Justice (Mrs. Geoghegan-Quinn)

There are two aspects to Deputy Mitchell's motion and I think it best to deal separately with them.

First, there is the question of the information I provided to this House on 25 November in reply to a Priority Question by the Deputy and, second, there is the allegation of serious fraud involving perhaps a number of victims and what is now being done about that matter.

As regards the information which I gave to the House on 25 November, what I said was that the Garda were not aware of any alleged criminal activity by the company in question. I went on to say, however, that the reply I had given was based on information provided to me by the Garda authorities and that this information appeared to differ from information, attributed to Garda sources, contained in an article in that day's evening papers which I had read shortly before entering the House. I informed the House that I had ordered an immediate inquiry with the Garda Commissioner's Office to ascertain the correct factual position, and I asked the Garda Commissioner for a full and detailed account of the up-to-date position later that day.

I am glad to be able to inform the House that the Garda Commissioner has now provided me with an updated report on this matter. What emerges from this is that the information I received from the Garda authorities, which I in turn gave to the House, was accurate, but only on the basis of a very strict, legalistic use of the term "complaint". I am now advised that the gardaí cannot treat a communication from a member of the public as a complaint in the technical sense i.e. something capable of triggering a criminal investigation, unless the communication relates to an occurrence which could, at the time the communication was made, amount to a criminal offence. I am advised that, for technical reasons, the failure by the company in this instance to deliver the furniture promised could not, in itself, amount to an offence unless that failure arose after the time lapse for delivery provided for in the contract had expired. Whether, even at that stage, the failure to deliver amounted to an offence is a matter which would fall to be assessed by the Director of Public Prosecutions following completion of a Garda investigation.

I am not aware when the Garda authorities informed me there had not been a complaint and that they were not aware of any alleged criminal activity that the term "complaint" was being used in the strict sense I have mentioned and I trust that the House will accept that there was no intention on my part to mislead. I have been assured by the Garda authorities that care will be taken to ensure that a misunderstanding of this kind does not arise again.

As to the facts of the case, I have already given details in reply to a Question put down on Tuesday by Deputy Nora Owen. However, given the understandable concern generated by this matter I believe the details are worth repeating. A UK registered company applied to the Department of Enterprise and Employment and was granted specific permits under the Occasional Trading Act, 1979, to hold sales of furniture at various locations around the country, including those referred to by the Deputy, between 23 September 1993 and 10 October 1993, inclusive. It appears that the company operated generally on the basis that a 50 per cent deposit on goods was taken from purchasers on foot of a contractual undertaking that the purchased goods would be delivered within eight weeks from the date of order.

I am informed by my colleague, the Minister for Enterprise and Employment, that an alleged breach of the Occasional Trading Act, 1979, by an Irish registered company, which appears to be connected with the company already mentioned and which conducted some of the sales, for trading without a permit on various dates in October has been sent to the Chief State Solicitor's Office for his advice as to whether proceedings can be instituted against this company for breach of the Act.

Because the Garda had been contacted by members of the public who were concerned that commitments to deliver furniture would not be honoured, they had been making inquiries from an early stage into the companies and the sales of furniture by them. These Garda inquiries did not amount to formal criminal investigation because, as I say, no criminal offence had arisen at that time as far as the gardaí were aware. The inquiries were considered to be justified, however, as a precautionary measure and to assist any formal investigation that might become necessary later.

The present position is that the Garda are currently conducting an investigation and, as part of the investigation, are making arrangements to interview members of the public who agreed to buy furniture from the companies. They advise me that this is a very complicated investigation spread over many counties and is being co-ordinated by the Fraud Squad. For that reason, and because of the nature of the contracts entered into by the customers it is not clear yet to the Garda if criminal offences have been committed.

The underlying concern here, of course, is how to protect the public from unscrupulous traders who may not fulfil contracts entered into by them, even though they are operating under an offical permit, as in the present case. I am advised that the consumers' rights provided for under the Sale of Goods and Supply of Services Act, 1980, and other consumer legislation such as the Consumer Information Act, 1978, apply not only with regard to sales by "established" traders, but also in the case of temporary sales. Consumers should be aware, however, that in the case of temporary sales they may have difficulty in enforcing their rights in practice as there may be difficulty in making contact with the seller.

I am also advised that the Director of Consumer Affairs provides information for consumers on their rights daily through his telephone complaints line, leaflets, newspapers and other media. In addition the director is involved in the development of improved consumer education in national, secondary and vocational schools. I am confident this programme will, in the longer term, bear rich fruit in enhancing consumer awareness generally. In the meantime, I assure the House that the investigation commenced by the Garda in the present case will be vigorously pursued.