Companies (Corporate Enforcement Authority) Bill 2021: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

I welcome the opportunity to speak on what is a fairly significant piece of legislation. The establishment of a corporate enforcement authority as a stand-alone entity replacing the Office of the Director of Corporate Enforcement, ODCE, is an extremely welcome step, and we are on the record as having welcomed this on more than one occasion. The ODCE has worked hard within the remit that it has had in recent times. Unfortunately, in the course of its work, the ODCE has often suffered from a lack of funding and resources, on the one hand, and a lack of adequate powers, on the other. It is ultimately these shortcomings which precipitated the proposal for the establishment of a stand-alone corporate enforcement authority as far back as 2017. This move was proposed by the then Government in November as part of a series of measures intended to address white-collar crime.

The establishment of this new agency is in part a response to severe criticism by Judge John Aylmer of the conduct of the ODCE in the prosecution of Seán FitzPatrick, the former chairman of Anglo Irish Bank. In May 2017, Judge Aylmer described the acquittal of Mr. FitzPatrick following evidence of severe deficiencies in the ODCE’s handling of evidence and preparation of the prosecution's case. Therefore, if this new agency is to be able to investigate and respond to complex breaches of company law, then, unlike the ODCE, it must have the necessary funding, resources, powers and suitably qualified experts in accountancy, information technology and corporate enforcement in order to do that job effectively.

The need for such resources and funding came to the fore when pre-legislative scrutiny of this Bill was conducted earlier in the year. There was unanimity among the members of the Joint Committee on Enterprise, Trade and Employment on the need for a stand-alone corporate enforcement authority which is funded and resourced to tackle white-collar crime head-on. There is a perception among the public, some of it fairly well founded, that corruption and so-called white-collar crime are not adequately detected and punished. The lack of legislation to tackle corporate and economic crime and the under-funding and under-resourcing of the agencies investigating white-collar crime has been de facto Government policy for decades. Over a decade and three successive Governments later, the lack of appetite to legislate for, regulate and properly tackle corporate and economic crime is simply shocking. The historic under-funding of the ODCE is a political decision. The office gets its funding directly from Government and if that funding is insufficient, then that represents a political failure. In 2007, the accounting firm RSM Robson Rhodes estimated that Ireland was losing €2.5 billion a year from economic crime. Economic cheats cheat us all, as they might say. If that figure is applied to the past 14 years, that is a potential loss of €35 billion to the Irish economy. The economic and social costs of corruption and white-collar crime far outweigh other forms of crime, yet it has consistently received far less funding resources and political attention from successive Governments. It is time the State takes this crime seriously and as the ODCE transitions to a stand-alone corporate enforcement authority, it is imperative that it is not only given additional funding and resources, but additional powers to help keep pace with technological advancements, such as seizing data and information that are stored in the cloud.

The collapse of the retrial of Seán FitzPatrick and the ensuing criticism of the investigation highlighted the need for additional resources and structural changes for the ODCE. Indeed, the ODCE has some crucial work ongoing currently, such as the investigation into the Football Association of Ireland, FAI. It is imperative, given what happened at the trial and the implications of the recent 2017 Supreme Court decision on data and privacy rights, that every single necessary resource requested by the ODCE in its investigation into the FAI is provided so that can be conducted in a timely manner. This is a huge investigation with significant public interest, especially among football fans across the island, and there can be no excuse for the ODCE not receiving additional funding and resources.

This legislation and the establishment of a new corporate enforcement authority must severely crack down on economic and white-collar crime. Not only that, but it must do so with such severity that the public are convinced that the State is finally taking these crimes seriously. There are many positives to this legislation beyond the establishment of the authority, such as granting the authority autonomy over the deployment of its resources, which is important, and I know my colleague, Teachta Quinlivan, will go into this in more detail.

I must come to a point of concern, however. Speaking with my colleagues about this legislation, it was a point that we all have concerns about and I am sure many will speak about it here today. One such area is section 944AE(3), subparagraphs (b) and (c). I would like to ask the Minister why a director who is sanctioned by the authority should be able to escape having his or her name publicised if such a publication would “jeopardise the stability of financial markets”. Furthermore, subparagraph (c) of the section states that a director who is sanctioned shall not have his or her name published if it “would cause disproportionate damage to the relevant director”. These sections seem to offer an almost unlimited get-out for relevant directors who commit offences. I did not come in here with a crystal ball but I would be willing to guess that if it goes through without amendment, we will not see many names in the public domain, which would be regrettable. I do not think that is the intention but having this “get out of jail” card is not a good idea. There is no reason these points should be included to allow directors get away from having their names made public. There is no mechanism for a young working class man or woman to escape their name being splashed in the local paper if a court finds them guilty of being in possession of a joint or some other crime. It seems to be a case of the Government looking after its own and I hope that the Minister will be able to address that concern. It is an area we will be seeking to amend on Committee Stage.

Second, some of the insightful suggestions raised during the pre-legislative scrutiny by Professor Deirdre Ahern in her submission are absent from the Bill that we have in front of us. The suggestion that the authority will consist of at least one member and not more than three members has entered the Bill at section 944F. In her written submission during pre-legislative scrutiny, Professor Ahern stated that to have one member, with an upper threshold of three, is surprising, and she recommended that this be revised upwards to a minimum of two and up to five. The reason for this is that a single member decision-making authority is not a good position to be in, and cost savings should not outweigh important substantive and procedural considerations that help to ensure the integrity of decision-making regarding the compliance and enforcement limbs that are the backbone of the corporate law system. It is an area that we will strongly consider for amendment of the Bill on Committee Stage.

We are supporting this Bill on Second Stage. We are committed to working with the Minister and his Department on this legislation. The Department, to its credit, has been extremely helpful to date through the many pre-legislative scrutiny hearings that have taken place, going back to earlier this year and in the last Dáil term. We intend to work constructively as the Bill goes through Committee and Report Stages and we hope that, through this process, we can pass a very important piece of legislation that is fit for purpose and will ensure a corporate enforcement agency with teeth that can go after crimes and criminals who have evaded the law in this State for far too long.

I am pleased to speak on this important Bill. We have been looking for this for many years in the previous committee and in the committee I chair at the moment. The establishment of a corporate enforcement authority as a stand-alone entity is a very positive and welcome step, and I want to put that on the record. For too long, white-collar crime has not been pursued as vigorously as it should be. These crimes are not victimless. They damage the international reputation of the State and impact on the price that consumers pay for goods. The establishment of the corporate enforcement authority is something that I and my colleagues in Sinn Féin welcome very much. Its establishment to replace the Office of the Director of Corporate Enforcement is a positive step. It should allow for increased resources and powers that can be used in the battle against white-collar crime. If we do not take this opportunity to reform, fund and resource this organisation properly, then we are failing everybody.

As a State, we have a poor record of dealing with so-called white-collar crime. Our failure to deal with this type of criminality means there has been little to deter others from engaging in it. With the establishment of a corporate enforcement authority, this record needs to be improved, as I hope it will be. People can no longer feel there is one rule for them and other rules for the rest of us. We must give confidence to citizens and introduce a deterrent to those who would commit such crimes. They have got away with it for far too long. Going after white-collar crime has never been treated with the same degree of urgency as going after ordinary working-class people.

The Joint Committee on Enterprise, Trade and Employment, which I chair, has examined the issue. We welcomed Mr. Ian Drennan, Director of Corporate Enforcement, to the committee and discussed the merits and demerits of establishing a corporate enforcement agency. I thank all my committee colleagues from all parties of this House for their vigorous analysis of this topic, on which we had long discussions.

One of the recommendations the committee made, which merits further consideration, is the suggestion that non-Garda staff who have expert skills be allowed to attend interviews. This would, in certain circumstances, allow additional knowledge and skills to be available during an interview. I appreciate this would require an alteration to custody regulations and I suggest that a feasibility study of such an adjustment be conducted as soon as possible.

There is broad support for this legislation, bar some issues of concern raised during pre-legislative scrutiny. I look forward to its enactment.

Granting the authority autonomy over the deployment of its resources is necessary. As I said, we must ensure it gets the resources it needs. The power to recruit its own staff with the skills it considers necessary will be a key component of ensuring the independence of the proposed corporate enforcement agency. Such independence is important, but oversight and accountability are also necessary. I welcome the provision requiring the agency to submit an annual report to the Houses. The requirement to submit strategy statements is another important element in ensuring the authority remains focused on its objectives and the strategies it has committed to using to obtain such objectives.

Granting the authority power to pursue and investigate suspected breaches of the Act, which is the fundamental objective of the authority, is important but it is also important to note that the Bill will grant discretion to the authority with regard to how it wishes to pursue individual cases.

Autonomy allowing the authority to resolve suspected cases by agreement has been included in the Bill at section 944AD. This section correctly allows the authority "absolute discretion" to "enter into an agreement ... to resolve" these matters. This is an important element that may save the authority time and resources that would otherwise be used to pursue a matter.

I welcome the inclusion of section 944R allowing the authority to carry out its functions by restricting the use of Articles 14 and 15 of the GDPR. This is an important carryover form previous Bills and will ensure the authority can investigate thoroughly any suspected breaches of company law.

I will raise some issues of concern, which my colleague, Deputy O'Reilly, mentioned. I refer to a concern raised at the pre-legislative hearings by Professor Deirdre Ahern. Professor Ahern was concerned about the number of members of the authority. The minimum number of one is too low and should be increased to between two and five. We will submit amendments on that matter.

A second concern is the failure to mention names, which Deputy O'Reilly also raised. This needs to be clarified or we will table amendments on that matter also. It is not fair that the name of a person convicted of a minor crime, such as possession of drugs for personal use, may end up in the local or national media, whereas the name of someone involved in white-collar crime will not be mentioned. It is important that we send out a signal that all people will be treated the same regardless of the crime they commit.

I reiterate my party's broad support for the Bill. There are elements that we will seek to amend. I look forward to the launch of the authority in 2022 and the message this will send to all those involved in criminality, no matter the type, and that white-collar crime will be pursued with all necessary resources. The Government has an opportunity to make sure the new authority, when established, has the resources it needs, whether funding or staff. I welcome the Bill.

Before moving to the Labour Party, I point out to Members that the debate is moving quickly. I have a list of speakers and the debate may conclude quicker than Members anticipate.

Nobody should be in any doubt that the reason we are debating this legislation is the catastrophic failure of the Irish financial system due to reckless property speculation and the appalling mismanagement of some of our financial institutions.

It is the business of Deputies in Dáil Éireann, as legislators, to create the law, it is the business of the Executive to govern and it is the business of the Judiciary to interpret the law. It is not our job as Deputies to interpret the law or administer justice and it is extremely important that we preserve the independence of the Judiciary. To that end, it is not normal that we discuss an individual judgment or trial as part of the normal business of this House. The fact is, however, that it is impossible to properly explain this Bill without referencing that its primary purpose is to address criticisms by a member of the Judiciary of some of the failures of the Office of Corporate Enforcement following one of the most high-profile failed prosecutions on record, one which was undertaken following the collapse of a financial institution which had been recklessly and foolhardily guaranteed by the State.

There is a perception among ordinary people that, collectively, the Legislature, Executive and Judiciary have failed in their duty to ensure that so-called white-collar crime is legislated for, investigated and prosecuted and sentenced passed in a way that is appropriate for the seriousness of the damage caused. To be honest, it is difficult to disagree when we see the many repeated failures of our system to detect, investigate, prosecute and convict those who abuse our financial, corporate and business laws with complete disregard for their victims. Let us be clear who those victims are. When financial crime results in the collapse of a bank or an insurance company, workers are thrown out of their jobs, customers are left high and dry and the State ends up picking up the pieces, we are all the victims. When financial misdeeds force the State to step in and bail out whole industries on the brink of collapse, we are all victims. When people cook the books, cheat taxes and siphon off profits, we are all victims.

During the implosion of the property bubble, ordinary workers saw themselves again and again thrown under the bus by the actions of a small few directors and CEOs who saw themselves as above the law.

Let us be under no illusions. Corporate crime at the highest level is often difficult to detect, complicated to understand and expensive to properly investigate. Too often, the perpetrators convince themselves that they are bending rather than breaking the rules and their crimes are mere minor misdemeanours - the kind of trifling technicality that still allows one to sit in the Dáil, despite a clear criminal conviction on financial matters, and have a direct phone line to Ministers.

We, the people, need a proper agency to tackle this crime and protect us from the social and financial damage to our people. We also need a system which will lead to outcomes and consequences, sentences and punishments which show the people of this Republic that we are serious about tackling corporate crime.

The Office of the Director of Corporate Enforcement was established following the Ansbacher scandal of the 1990s and the repeated findings of corruption, bribery and wrongdoing by tribunals which previously led to seemingly minimal consequences for those implicated. While the ODCE had some successes, it has become abundantly clear that it is only scratching the surface of what is required and was unable to deploy and exercise powers and resources to protect our society from the highest levels of business and financial fraud and crime.

In 2016, the Office of the Director of Corporate Enforcement returned more than half of its budget unspent. Under this Government, the ODCE had to wait almost a year for the allocation of six detectives it had asked the Garda Commissioner and the Government for in order to do its job.

It is no exaggeration to say the collapse of the Celtic tiger case at the heart of the Bill has been held up to almost every Deputy as an example of how the rich and powerful always get away with it. We should not seek to scapegoat individuals or single organisations. As legislators, we need to take responsibility and ensure we do what we can to tackle corporate fraud and do so in a way whereby people are dealt with fairly but the ordinary person in the street has confidence that white-collar criminals who steal, cheat or manipulate people or entities to the tune of millions of euro are subject to consequences appropriate to the scale of their crimes.

The main component of the Bill amends the Companies Act to establish a corporate enforcement agency to replace the Office of the Director of Corporate Enforcement, ODCE. The Labour Party supports the establishment of this new agency and making it a commission independent of the Department of Enterprise, Trade and Employment. However, we cannot stop there. My fear is that we will set up this under the misapprehension that our work is done only for the next scandal to result in more shaking of heads, an inevitable review and another fruitless exercise in shutting the stable door after the horse has bolted. The problem of corporate crime is not just a problem that can be solved by setting up a new agency and walking away. What we need is a complete change in cultural, political and social attitudes. Corporate crime is born of the right-wing attitude that greed is good. Corporate crime is born of the attitude that regulations apply to only ordinary people, that profit for the shareholders is all that matters and that rules are there to be bent. Corporate crime is born of the attitude that company law is there to be exploited rather than obeyed and that paying tax is an imposition to be avoided rather than a valuable contribution to running a better society. I remind Deputies that tax exiles are not heroes. We need a society where business ethics are taken seriously and not just paid lip service.

I urge the House to remember that the corporate enforcement agency can be only as effective as the laws we give it to enforce. Unfortunately, the constant refrain of "too much red tape" or "too many regulations" led by some in the private sector and backed by industry lobbyists and some of our politicians is all too pervasive in Irish life and undermines the robust framework of legislation needed to prosecute and punish so-called white-collar crime. Too often we see campaigns to have regulations watered down, undermined or abolished. Unfortunately, there is a culture, particularly on the right, of paying lip service to corporate social responsibility while trying to undermine the proper regulation necessary to protect workers, consumers and honest business people. We see the failure of adequate legislation to deal with the failures relating to mica, pyrite and fire safety in construction and many of the business entities responsible for such scandals disappearing and re-emerging, the principals hiding behind the shelter of corporate laws.

As we debate this Bill, we must look at the provisions and ask ourselves whether we are doing enough and whether there is any way we can strengthen the agency and its powers to make sure it has what it needs. As the Bill proceeds through Committee Stage and beyond, we must examine every clause and ask ourselves whether it will help deliver justice. For example, I note that the proposed section 944AF provides that the authority may not impose on a director a monetary sanction that would make him or her bankrupt. It provides that only one monetary sanction may be imposed where more than two breaches of the same conduct have occurred and it re-enacts section 957G of the Companies Act 2014. We might reasonably ask whether in the eyes of the ordinary person such provisions are consistent with how ordinary people are treated. If someone breaks any one of our country's by-laws on parking, road tolls and so on, he or she must pay a fine for each instance. People do not get to say they want to pay only one fine for all the times they break parking rules. I am also concerned that the threat of bankruptcy should not be abused as a mechanism for refusing financial penalties for serious breaches of corporate law, particularly in view of the reform of the bankruptcy laws and procedures.

As well as the main section establishing the authority, the Bill provides for the implementation of several recommendations of the Company Law Review Group, CLRG, relating to corporate governance, shares and share capital, which hopefully we will be able to welcome as strengthening the protections for citizens.

The Bill brings back memories of some of the most painful and appalling travesties in Irish political and financial history. It is ironic that we are here to discuss a Bill of a Fine Gael Minister for Enterprise, Employment and Trade under a Fianna Fáil Taoiseach. I remind the Minister of State that what we are speaking of now is fundamental to the future of our Republic. I taught for a time in the north inner city of Dublin. There used to be media reports of the community in which I served. It was just beside the IFSC. In the 1990s, media reports used to say it should have been the aspiration of young people in the north inner city to get employment in the IFSC. They used to pretend that crime was all in the north inner city, that the paragons of virtue were those wearing suits in the IFSC and that, if those young people could turn away from the parallel economy and the temptation of cheap money and criminal activity and turn their eyes to the IFSC, they might have a better future. All the while, the criminality that almost brought down the Republic was taking place in the IFSC. That is the crux of the matter when speaking to a young person about the choices he or she has - are we equal or are there different laws for people who wear different suits?

I have only a few minutes, so I will be brief. I welcome the Bill. When an organisation that has been operating on an ad hoc basis is put on a statutory basis, the power, authority and status of that organisation are much improved. However, even the most unbiased observer would have to admit that the record of the ODCE has been a mixed one. People have referenced the FitzPatrick case. I believe the Minister of State mentioned in his opening statement when introducing the legislation that there had been procedural changes in the organisation as a result of that case. Having studied the case closely, I would like him to give the House an indication of exactly what procedural changes he was referencing.

Putting the ODCE on a statutory basis is the primary purpose of the legislation. The secondary purpose is to improve the law, as recommended by the CLRG, and correct some anomalies in the Companies Act 2014 that have emerged through practice. Most of the Bill's measures are technical and relate to share ownership, share consolidation, mergers, etc. I welcome them, as there have been problems in practice. Some of the measures are fairly obvious ones relating to corporate enforcement. For example, the power to restrict directors is being extended, which is welcome. The qualifications of directors and liquidators are being addressed in this Bill. I am surprised this issue was not dealt with long ago, but it is nevertheless welcome even if it is late. There are some basic provisions, such as the requirement in certain circumstances for directors and liquidators to produce their PPS numbers. I should have thought that was fairly obvious.

I welcome the proposal to put the authority on a statutory basis and I welcome the legal changes, which are necessary. I am concerned about some of the wording in those legal changes, particularly surrounding directors, and I hope this matter will be thrashed out comprehensively on Committee Stage. It will be a while before we return to this topic again, so it is important we get it right.

The Minister of State referred in his initial statement to a 20%, or €1 million, increase in the budget, bringing the current budget to €6 million, and to 14 additional civil servants and nine additional gardaí, giving a total personnel improvement to the agency of 50%. While I welcome all that, I have to reflect nevertheless that €6 million seems an extraordinarily small sum to deal with such an important matter. I realise that this is not the sole agency dealing with white-collar crime, in that it is also dealt with by the Garda fraud squad etc. but corporate crime is a multibillion euro international business. It is one of the biggest growth areas of crime in this country. While the budget for this year would appear to be €6 million, if a number of cases come on board and the people running the agency feel constrained by the fact that their budget is limited, will investigations be delayed unnecessarily? Sometimes these investigations of necessity have to take place pretty quickly. I would like to see a more open-ended arrangement whereby the agency can access funding as it needs it. I would also like the Minister to give a breakdown of how the €6 million will be spent. I presume the extra gardaí will be paid from the Garda budget. Is a specific amount set out for bringing in outside experts, as will often be necessary in cases like this? I say that because white-collar corporate crime has a number of very significant consequences for this country. First, there is an obvious loss of revenue to the Exchequer, which could be spent on social projects. Second, as the pandemic comes to an end the economy of this country will, it is hoped, rebound. That will depend to a large extent on foreign direct investment, the importance of which will not reduce in the years to come or in the immediate future anyway. To attract foreign direct investment, we cannot afford the reputation of the country to be damaged by the notion or perception that we are soft on corporate crime.

Most importantly, I have seen nothing that undermines respect for the law more than the notion that if you are rich or a corporate entity, you can get away with it, that is, there is one law for one section of society and a different set of rules for the other. As I said, that has undermined respect for the rule of law in this country and that is very unhealthy. We have to be ruthless in regard to white-collar corporate crime. To be ruthless, we need not only the laws and the structure, we need proper financing. We can have lots of law and very little order. You can have all the laws in the world and all the structures in the world but without adequate financing they will not work.

I compliment the Minister of State on bringing forward the legislation. There are some amendments that I feel will be necessary but they will be, I am sure, dealt with as the legislation goes through Committee Stage. I would like to think that the budget is not fixed such that if it appears that the agency will exceed its budget in any particular year, there will be extra money available rather than the agency having to go cap-in-hand to the Minister for Finance year in and year out. That is the least the country deserves.

I welcome the establishment of the Office of the Director of Corporate Enforcement as a statutory stand-alone agency to be known as the corporate enforcement authority, CEA, with increased autonomy and resources to respond to white-collar crime in Ireland.

I thank my colleague, Teachta Quinlivan, Chairman of the Joint Committee on Enterprise, Trade and Employment for his work on the committee. For too long, white-collar crime has not been pursued as vigorously as it should be. Corruption, so-called white-collar crime and the perception that they are not adequately detected and punished are damaging to our economy and threaten our international reputation as a reliable place to do business. There is a widespread view that crimes like these are not as much of a priority because of the wealth of some of the participants. This needs to be addressed. It is important that ordinary members of the public have confidence that white-collar crime is treated with the seriousness it deserves. Our approach to such crime must be evident in the structures that we put in place to deter it and in the resources that we apply in dealing firmly with such crime where it occurs. We need appropriate legislative powers and funding to ensure that the agency delivers what it will be tasked to do.

The ODCE is being reconstituted as the CEA in a commission structure with a larger specialised staff and an increased budget. One of the key elements of this new structure will be the increased number of specialist gardaí seconded to the CEA. The availability of their knowledge should ensure that a more functional structure can properly investigate suspected breaches of company law in a more timely manner than previously seen. Addressing economic and white-collar crime is vital in demonstrating that nobody, regardless of their resources, is above the law. We need to see more effort made to implement the recommendations of the Hamilton report. There must be wider investigative powers to help the CEA to achieve its aims. The promised investment must be delivered, including the assignment of 14 additional staff and an increase in the permanent complement of members of An Garda Síochána from seven to 16.

Everyone acknowledges that the ODCE was understaffed and underfunded. There can be no more excuses. This agency must be delivered. We must not forget the other recommendations of the Hamilton report, including that the CEA must prepare a strategy statement as soon as possible after its establishment detailing its key objectives and output for the following three years. We must also ensure that it is regularly reviewed and updated.

I welcome this debate. Simply put, we do not currently have an effective means of preventing, investigating and prosecuting corruption. There is no overarching or consolidated approach to combating corruption in the private sector or the public sector. A look at the State's anti-corruption website gives us a clear picture of the fragmented approach, with 16 bodies listed as responsible for tackling corruption. Our anti-corruption response is incredibly fragmented by international standards. A 2020 survey conducted by the French Anti-Corruption Agency in partnership with the Group of States Against Corruption, GRECO, the OECD, and the Network of Corruption Prevention Authorities, NCPA, found that 84 of 114 countries surveyed had a single-agency approach, one which the Social Democrats has been championing since it was founded.

It is difficult and rare to see successful prosecutions of corrupt practices in business life in Ireland. Even after costly and lengthy tribunals of inquiry, there have been few consequences for those against whom negative findings have been made. There is a strong public perception of a golden circle in Irish society, the members of which are accountable to no one and who regard themselves as untouchable. The EU Commission's 2017 Eurobarometer on corruption found that 68% of Irish people believe that corruption is widespread across society, with a particular lack of confidence in the banking and financial sector and An Garda Síochána.

The creation of an independent statutory agency to oversee white-collar crime without doubt is welcome. The ODCE has remained in the purview of the Department of Enterprise, Trade and Employment for far too long and its effectiveness has been constrained as a result, with a lack of independence over its budget and the hiring of staff. Globally, anti-corruption agencies have only ever been effective where there is a significant and consistent political commitment to tackle anti-corruption and where those agencies are allowed to operate free from political influence and, by extension, free from the type of lobbying that Deputy O'Dea talked about in terms of watering down sanctions.

The effectiveness of the anti-corruption agency is heavily dependent on the support and institutional co-operation between other agencies that address the broader issues of corruption, integrity and ethics.

In this instance it is very clear this co-operation has been lacking between the ODCE and An Garda Síochána. The ODCE had to wait nearly a year to be allocated six detectives from An Garda Síochána and there were successive delays and a lack of communications from the Garda. Emails released under freedom of information to Ken Foxe of Right To Know show the frustration within the ODCE, with its director, Ian Drennan, stating the Garda clearly had no intention of transferring the officers in the foreseeable future. He contacted the Department of Enterprise, Trade and Employment and was told the Tánaiste had been in touch with the Minister for Justice and that the first allocation of two detectives to the ODCE had taken place in April, to be followed by two more in June, with the final two arriving later in the year. In response, Mr. Drennan said the appointments were temporary and did not address the need for a permanent additional investigative staff. Mr. Drennan told the justice committee he wants a memorandum of understanding between the new corporate enforcement authority and the Garda Commissioner, Mr. Harris, over the allocation of Garda resources to that agency. I had a priority question with the Minister of State last week on this very topic and it is very clear from what he has told us that there will not be a memorandum of understanding but what is in place is a letter from each to the other. That is not good enough. It is better than what we had but it is not anywhere near good enough. It is a bare minimum to have that memorandum of understanding between the corporate enforcement authority and the Garda Commissioner prior to the agency getting up and running. The proposed corporate enforcement authority retains a reliance on secondment of gardaí at the discretion of the commissioner and we simply cannot assume this process will go smoothly. The delay in the provision of investigative staff to the ODCE in the past year is unacceptable and hampers its ability to conduct a vital public service. Protections must be put in place to prevent the same from occurring within the corporate enforcement authority. We cannot criticise an agency for not doing its job if it has not got the resources to do it.

Looking at the proposed make-up of the corporate enforcement authority, the level of independence is questionable. While the authority will be removed from the Department of Enterprise, Trade and Employment, the Minister will appoint three full-time members based on recommendations from the Public Appointments Service, PAS, choose which member will act as chairperson and can fire them at any point due to ill health, stated misbehaviour or where the removal of a member appears to the Minister to be necessary for the effective performance by the authority of its functions. The Minister also has the sole authority on picking acting members to fill vacancies as they arise. The appointment of the chairperson by the Minister in this particular instance is completely unacceptable. This is supposed to be an independent anti-corruption agency and must be free from political influence. The Minister - that could be any Minister in the future - potentially could be able to guide the authority in a certain ideological direction by hand-picking the chairperson. That is over-reach. The proposed number of full-time members for the corporate enforcement agency is also too low. The justice committee recommended the minimum number of members on the authority should be increased to two, with the maximum number being increased to five. If this Government aims to be serious about tackling corruption in the private sector it must be serious about it from the very beginning. We must build up this authority in the way we mean it to continue rather than creating a system we know will be under-resourced in a few short years.

Another example of this is not providing the corporate enforcement authority with investigative powers, something for which the ODCE has been calling for some time now. I cannot understand why it would not be awarded those powers. The current system of leaving expert civilian staff outside the room while gardaí conduct interviews is completely ineffective. This must be all one piece. I am trying to imagine a scenario where you have temporary secondments of people who have the knowledge and they cannot be brought in. They are instead in and out trying to figure out just exactly how the interview should be conducted. When an individual is arrested there is, as we know, very limited time to conduct interviews. These interviews often contain a vast amount of intricate detail, particularly in this area, which requires expert knowledge. Valuable time is wasted by gardaí having to ferry information and questioning back and forth between the suspect and ODCE staff. As such, a big mistake is being made here on that. This is an absolutely essential power the CEA needs to work effectively, a power which has been called for by the ODCE and Transparency International Ireland. We have an historical tendency to be reluctant to grant State agencies further powers after they have been established. The Minister of State might outline what exactly his plans are on the provision of this power and why it is not intended to include it in this Bill.

According to global studies by Transparency International, budget allocations and independence over budget decisions have been proven to be a good indicator of a Government's willingness to tackle corruption. In the past few years there has been an increased move towards multi-annual funding as a budget method, allowing organisations to plan ahead, secure in the knowledge they will have sufficient funds in the next budget round. It is also essential for this agency to reduce the political involvement by reducing the Minister's ability to cut funding. I am not talking just about the current Minister or Government. This is a piece of legislation that will have a lifespan, so it is really important that is done. Multi-annual funding would provide the security and confidence needed to tackle big corruption cases within the private sector.

International research has shown it is large-scale public corruption cases which impact most strongly on the public's confidence. They are very visible and they send out a message so it is really important there is the confidence to take them on. In other jurisdictions the inability to prosecute some corrupt individuals with political and financial clout has led to declining public confidence and a lack of trust that anti-corruption agencies can perform their role diligently and objectively without fear or prejudice. The corporate enforcement authority must be ready and able to take on the most high-profile cases of anti-corruption in this country. The ODCE has experienced an increase in funding in the past few years, with €6.1 million allocated last year. However, the agency is currently underspending its budget allocation by €1.8 million. This underspend was largely due to vacancies, delays in recruitment and a failure to complete procurement processes by the year end, all of which speak to a critical lack of human resources within the office which cannot be solved by money alone. To properly measure the effectiveness of the corporate enforcement authority we must have the data to do so. The Director of Public Prosecutions and An Garda Síochána should publish disaggregated data under a new category which allows for analysis of enforcement of corruption-related offences. Prosecutions are currently categorised under fraud offences.

The formation of the corporate enforcement authority, though I would argue it is imperfect, is a welcome step forward to address white-collar crime but corruption in the public sector must be also tackled. Comprehensive and intelligence-led policing is essential if warning signs and suspicious activities are to be identified. That really protects the public service, just as a good corporate enforcement authority protects the private sector and gives confidence to the people of integrity we want to be working in both the private and public sector. The sharing of data among many existing agencies is unlikely to be enough to expose the complex and politically-sensitive cases.

It was stated earlier that this whole world is well resourced and that people are well connected. I had an experience where somebody came in here and asked to interview me. As it happened, I understand that he wore a camera. When the matter was followed up on later by a journalist, Peter Murtagh of The Irish Times, who wrote an extensive article, having been to London. Mr. Murtagh discovered that there were many agencies or companies located near MI5. This was a whole world that I did not know existed. These were companies that involved themselves in the world of business. From reading the articles to which I refer, I discovered just exactly what we are up against. When one starts looking at the tiny amounts of money available here, at how gardaí have to be seconded in - you might get them and you might not - and the fact that one might not or might not have multi-annual budgeting, it all shows that we are creating a David-and-Goliath scenario when we do not have to.

An independent anti-corruption agency with jurisdiction over the public sector is also necessary. The Social Democrats have argued that one large agency with real power and resources would be more likely to be effective. We should start to look at matters like reputational damage. This was something we were always told about after the financial crash. We should look at this matter from the point of view of reputational damage. However, we should also look at it from the point of view of inculcating good practices. Having an effective agency to facilitate that would build public confidence. There are things in this in this agency, as it has been set up, that are deficient. There needs to be a re-examination in the context of embedding the law enforcement element into it and a reconsideration of the resourcing and budgeting involved. We must examine the possibility of having a bigger agency, as opposed to having many fragmented agencies that do bits and pieces, rather than the totality of the work that is required.

Anois, bogfaimid ar adhaigh. There are a number of speakers listed, but I do not see any of them. If I am missing any of them, they can give me a gentle shout. I am moving down the list and have come to the Rural Independent Group. There are a number of speakers. I call Deputy Michael Collins.

The Tánaiste and Minister for Enterprise, Trade and Employment published the general scheme of what has become the Companies (Corporate Enforcement Authority) Bill on 4 December 2018. This measure was proposed by the Government in November 2017, as part of a series of measures intended to address white collar crime. The principle measure to be addressed in the Bill is the establishment of a new corporate enforcement authority as an independent company law compliance and enforcement agency. This body will replace the ODCE, which currently supervises, regulates and enforces compliance with company law. The intention behind the new agency is to ensure that suitably qualified experts in accountancy, information technology and corporate enforcement will be available to investigate and respond to complex breaches of company law.

This whole affair adds to public scepticism about how the fallout from the banking collapse was handled. Only three bankers went to jail for fraudulently moving funds between Anglo Irish Bank and Irish Life & Permanent in order to make the former's books look better. Ironically, their crime was in trying to cover over cracks in the financial system as the house of cards started to tumble. Nobody has been held to account for the massive orgy of bank lending which sowed the seeds of the crisis in the first place and led to huge enrichment for senior bankers along the way. Most of the senior bankers, regulators and politicians of the time have retired and are on big pensions. There was no big gap in Irish law which allowed the banking crisis to happen. The Central Bank of Ireland’s powers have since been beefed up, for sure. However, even back when the bubble inflated, it had the legal firepower to at least limit the damage. Also, as a 2016 report of the Law Reform Commission into the regulation and corporate law pointed out, since 1992, it has been an offence for a bank or building society to fail to manage its business in accordance with sound administrative and accounting principles.

The question I would ask is: who paid for this mess? It was we, the taxpayers, who paid. Nobody, but nobody, was held accountable. Will this legislation make people accountable? It is hard to think that it will, because it seems that in this country, the bigger you are, the better the cover-up and the better the pet on the back for doing wrong. Banks in this country are closing their doors to people. These are the very people who bailed out the banks when they had a lot of corrupt goings-on in their businesses. They were found out in this regard but little or nothing was done about it. That did not stop the banks from punishing the people once they got over that bit of a hump and a blind eye was turned to what they were doing.

Banks in my own part of west Cork have been closed, such as AIB in Schull. The Bank of Ireland branches in Dunmanway and Bantry are up for closure in the next number of weeks and no one in government has batted an eyelid. The Minister's colleagues are shouting foul, but they are in government. If ye cannot turn this around, I do not know who in the name of God can. The banks were in a position to dictate the way they ran their businesses in the past. They could dictate how easy it was for them to get away with running their shoddy businesses. They continue to do the latter in different ways and are still unaccountable.

Deputies Mattie McGrath, Carol Nolan and myself took part in a sit-in at KBC Bank in December 2018. Our intention was not to leave the premises until the bank started talking to its customers and stopped treating him like they were some kind of wild animals. They were human beings who had maybe got into a little of debt. I would always support someone who is in a bit of debt and trying their best to come out of it. Instead, the bank rammed the vulture funds down on top of their backs, swept them out, got their bodyguards down from all over Northern Ireland, ran into their farms and ran them out of their houses. Good God almighty; that type of behaviour dates back a couple of hundred years. Again, there is little or nothing in this legislation to make sure that something like that can never happen again. People fought hard to purchase a bit of land. They do fall on difficult times. There is probably no one in the country who can avoid that situation. However, a bank like KBC was unscrupulous in its business and was found out to be doing that. Unfortunately, it is now walking away from the Irish market and it could not care less. Nobody cares. Nobody has power over the banks. They are a law onto themselves. Of course, they will come back to us if they need a bailout. If they are doing something wrong - whether it is one bank or another - we can see how they all can get away with it. People find themselves in desperate, sad and difficult situations as a result.

The saddest thing of all - I know that this is slightly away from the issue - is that we are not supporting the credit unions in the way we should be, particularly as they are not the ones who causing difficulties with our laws or in various situations. The Government will not assist credit unions to loan out money to farmers and businesspeople, or to give a small mortgages to people who want to start off in their lives. They are being refused by regulation in this State. I met with the credit unions in West Cork. They have great branches in Dunmanway and Bantry, places from which Bank of Ireland is walking away, Schull, from which AIB walked away, Clonakilty, Skibbereen, Bandon, Castletownbere and elsewhere. They have great branches. The people who run them know everybody and they respect everybody. Thanks be to God, we do not see them involved in any of the kinds of scandals to which I refer.

We have to bring forward legislation to stop the corruption and the carry-on that went on from happening again. The sad thing is that credit unions are not getting assistance from the State. The legislation being looked at that moment needs to be dealt with immediately in order to free up the credit unions to do a bit of business for people, because we are running out of banks and the banks are running away from us. They have had it with the Irish market. They have cleaned us out fairly well. The State backed them up to the hilt. It is now time for us to put our foot down and support the Irish businessman and the Irish farmer.

The laws and regulatory powers were all there before. The problem was that by the time anyone realised that the banks were in a mess, it was way too late. Just as the system failed to stop the crash, its response afterwards has been found wanting.

A key mistake was made early on by not applying to send a High Court inspector into Anglo Irish Bank and Irish Nationwide. This would have at least provided some clarity on what happened. Instead, we have an interminable legal process based on specific charges with decidedly mixed conclusions. In turn, that has put other investigations on hold, for example, an inquiry by the chartered accountants' regulatory body into specific issues relating to EY's audit of Anglo has been on hold for some years on the request of the Director of Public Prosecutions, DPP, who did not want it to affect other legal proceedings. Other inquiries into the crisis, such as the one under taken by an Oireachtas special committee, have had to tip over issues around issues which crossed over legal cases under way or planned. Our legal process is slow at the best of times but the huge legal teams employed by all sides seem to delay the cases relating to the banking collapse interminably. There is something still in the investigation and prosecution of alleged white-collar crime that is not working. The Law Reform Commission suggested some ways to improve regulation and the legal structure and the penalties for offending have been increased, notably in 2014 legislation, but the key issues seem to lie in the investigation into the allegations of white-collar crime, and when evidence is gathered and the legal process used thereafter. There are endless hurdles, even before a jury gets to hear a case. Rightly or wrongly, this gives the impression that alleged white-collar offences are simply not treated the same as what might be called more traditional offences. That is the fact. That, unfortunately, is the situation that Irish people find themselves in. The good people of west Cork, my constituents, tell me that, sadly, corruption is applauded and has been applauded in this country many times. People who have been found to do wrong have never been made fully accountable. They have been patted on the back all along by the political system, as well as the banking system. They have been given plenty beautiful pensions and they can play golf while those people whose businesses have been ruined from trying to pay off debts caused by the bankers' carry-on have been left high and dry. They do not believe in the legal system there at present. I hope this Bill will do something to turn this around but when ordinary people on the ground talk to me, they are not at all impressed by what they have seen down the years. Now, as I said, we have seen the walk away of banks again. Not alone did they run away with money before but now they are walking away and leaving people under further stress and pressure and sadly, are aided and abetted by the political system. When the banks go under, we, the people of Ireland, must be there to make sure that they are propped up and that the State will back them. When they walk away, the State has no say in the matter. It is a decision made by the bank and the people are left there hanging.

While I do not think that changing the name of the Office of the Director of Corporate Enforcement will help, if more staff are employed, properly trained in the role they are supposed to carry out, I believe that will help. We all know what the banks did, including Anglo Irish Bank. I know fellows who cried, grown men, and the fellows in charge of it got away. We all know what Bank of Ireland and AIB did going back to when they advised their customers to put their money into overseas accounts. I know one man who never did a day's good after that. It should have been easy enough for someone to follow the pattern. It was not that men from the wilds of Blackwater, Sneem or, indeed, Kilgarvan, all had the idea to do the same thing; they got the advice to do that and they all suffered. They paid high penalties and their names were in the newspaper and the bank got away with it because they gave the names. Anglo Irish Bank got away with it. Bank of Ireland was no angel either. It is closing its outlets in different towns in Kerry and we do not applaud that.

The Government has a percentage stake in both banks. It should use it to ensure that a service is given to the people and especially the people in rural Ireland. Farms are being sold by vulture funds without farmers knowing. I contend that the vulture funds are all wrong. The customer had a deal with the bank, not the vulture funds, or they were never made aware that these vulture funds would come along with henchmen and sticks, who wore masks to hide who they were, threatening them to get out of their houses and off their land. These vulture funds have no right, even though they purchased something from a bank or finance company at a cheap price. There should be a follow-up there to see what is going on. These funds do not operate according to the deal done between the person who might have bought their house and ran into health problems or maybe the person who was trying to improve his lot as a farmer, buying a piece of land to try to increase his income to try to stay on the land. They did a deal with a financial company in Ireland, usually, Bank of Ireland, AIB or whoever, and the accounts were sold to the vulture funds. They should be followed up.

I think we are sharing time.

All right. I should also mention that corporate enforcement did not always help people when someone got into trouble and went bankrupt. They did not help the people on the ground who lost their money, maybe sums of €20,000, €60,000, €70,000, €80,000 or €90,000. Instead, it went on the side of the developer or businessman who went broke and helped them more than the ordinary people who lost all the money they were owed. I have no problem in the world in backing that statement up anywhere.

I acknowledge Deputy Mattie McGrath for allowing me his time on this very important matter. When taking about corporate enforcement, something that strikes me, as it must strike all Deputies in the House as they do their clinics, go around meeting people and dealing with people who have had roughshod treatment from the banking and lending institutions, is that there is a lot of enforcement on those people. The Minister of State ably represents his constituents and is 100% on the side of young couples whose mortgages have been taken over, although I will not mention the names of these crowds that come along. I have nothing against people who want to go out in business and make a profit - more good luck to them - but when people want to make a profit and to profiteer on the misery of others, that is where we have a big problem. When people enforce their will on, say, a young couple who are paying for their mortgage and are paying their debts, that couple might ask themselves a question.

Where is corporate enforcement when it comes to helping us? Where is the law of the land when it comes to helping what I would call the "smaller" people? We had bailouts for the banks and big millionaires who owed millions of euro, and we heard of debt being reduced again and again. Where was the bailout for ordinary people who owed an ordinary amount of money and now find themselves being evicted from their homes?

Banking institutions in general are our banks. AIB and Bank of Ireland are our banks. The last remaining credible lending institution, which is a good and credible group of people, that maintained its reputation through all the crises, is the post office. I should also include the credit unions, which are not-for-profit organisations. All they want to do is take care of their customers, which they do in an excellent way. I acknowledge that many of the cataract patients I send up to the North avail of credit union loans to help pay for their operations. I thank the Irish League of Credit Unions for the great work the credit unions do, working in conjunction with these people and serving them by providing money at a nominal fee so they can have their operations done, for which they are reimbursed afterwards by the HSE. That is terribly important.

When we are talking about white-collar crime and the big shenanigans that go on, where is the enforcement and help for the smaller people? These are the boys and girls with mortgages, young children and families as well as small business owners who are doing important work creating one or two jobs for themselves, neighbours or friends. They may have run into a little bit of financial bother. Every organisation and damnation from hell can come down upon them if they run into little bit of trouble. There is no assistance from them.

What we and every other Deputy in the House, from all parties and none, want is fair play for everybody, particularly the people who are really struggling. They are the backbone of Ireland who send us in here to speak up for them. We respect big business. There has to be big business and we want more of it but we also want fairness and equity for the people who are struggling and who we deal with every day of the week. As late as last night, I had a good few meetings with people. To be honest, it gets inside your head when a young couple tells you they have be out of their house in a month's time and the nearest place they can find in their locality costs €1,500 or €2,000 to rent per month. Where in the name of God are people supposed to get that type of money? They are being told to get out of their house. I mean no disrespect to our local authorities. They cannot pull houses out of a hat. What are we supposed to do for these people? Where is the enforcement by agencies of the State to help them? That is the point I want to make.

As there are no further speakers offering, I invite the Minister of State to respond.

I thank all Members of Dáil Éireann who contributed to this important debate. We are in unison on the need to enact this legislation to establish the new corporate enforcement authority without further delay. As many Deputies stated, white-collar crime is a menace to society. It has huge consequences, not only economically for citizens but also in terms of the reputational damage it can do internationally.

I do not differentiate between people who break the law. Whether someone wears a suit or a tracksuit, the law is there to protect the common good. If the rich can get away with breaking the law, it undermines the rule of law, as Deputy O'Dea has said. That is not something we can support. We need to be ruthless in how we deal with white-collar crime. For this reason, one of the first actions I took in my area of delegated responsibilities when I took office was to meet the person who will be the director of the new corporate enforcement authority to discuss how we could make this legislation a priority. I am, therefore, glad to be introducing this legislation in the House today. As previous speakers said, it has been promised for some years. We are now discussing it on the floor of the Dáil. This engagement is welcome, as was the pre-legislative scrutiny process in which members of the joint committee fully engaged.

The underlying rationale for establishing the office as an independent statutory agency is to ensure it has the legal and organisational wherewithal to provide for effective corporate enforcement in Ireland. The independence and autonomy that will be afforded the new office will ensure it can hire and recruit the necessary expertise as it sees fit. This process has already started.

I will make two main points on the resources and powers of the new authority, a topic that was raised a couple of times. Resources are key to the success of this transformation. As I said, the director has assessed what he believes will be the requirements of the new authority based on the functions and number and complexity of cases it will handle. The resources now being applied to the new authority are in line with that assessment. As Deputy O'Dea said, while they may be in line with that assessment now, it is important that we keep this matter under review and ensure resources keep pace with developments or any increase in workload the new body may have.

The budget has already been increased by 20% and the Department has approved 14 additional staff to be assigned to the authority. The authority will also require the secondment of additional Garda resources to enable it to deliver its new statutory remit. I am pleased to report that the Garda Commissioner has written to the director very positively in this regard. This will see the complement of seconded Garda resources increase from seven to 16. As I stated in a reply to Deputy Catherine Murphy during oral questions last week, the Garda is in the process of formalising arrangements for the secondment of gardaí to the new body. This is very important. We do not want a repeat of the circumstances where the authority was left waiting for a number of months for the staff it required.

It is important to point out that placing the authority on a statutory footing is a first step. It is not the end of the process but the beginning. The Department will continue to work closely with the new authority to ensure it has the appropriate legislative tools necessary to enhance Ireland's company law framework and undertake modern, complex corporate law enforcement.

The Government continues to work on new measures to tackle economic crime and corruption, in particular through the cross-government implementation plan arising from the report of the Hamilton review group led by the Minister for Justice. The new powers and other enhancements for the new authority are matters that are continuously under review and will be actively considered.

A couple of specific questions were asked of me, one of which was on the publication of names. These sections simply re-enact existing sections of the company law legislation. They are not new and were introduced into the Companies Act 2014 by the Companies (Statutory Audits) Act 2018 in order to transpose the EU statutory audits directive and regulations 2014. It is required by EU rules to have these exemptions to the publication of details.

Non-Garda staff are to be asked to attend interviews. As it stands, pending an amendment to the custody regulations, non-Garda staff from the new agency may not attend interviews of a detained suspect. The implementation plan arising from the Hamilton review group, however, proposes to address this in the context of the forthcoming Garda Síochána powers Bill. We believe this is the most appropriate way to address this issue and it is something we are determined will be addressed. This concurs with, I believe, the point raised by Deputy Catherine Murphy.

The number of members of the authority has been assessed and is deemed proportionate and appropriate in the medium term. However, the scope is there to raise the level up to three. That is comparable to other agencies such as the Competition and Consumer Protection Commission.

Deputy O’Dea asked about procedural changes since 2012. The new director was put in place in 2012. On arrival he carried out a comprehensive review and further professionalised the ODCE in the area of in-house forensic accountancy expertise, in particular, specialised investigation training and an enhanced culture of risk management.

I have already answered on the number of gardaí and I also commented on the detailed arrangements regarding the secondment of members of the Garda.

If there are any other points to which I failed to reply today, we will be bringing this Bill onto Committee Stage and I look forward to engaging with all Members of the Oireachtas at that Stage. From my own personal perspective, I am happy to look at any potential amendments that may arise to ensure that we can strengthen this legislation as far as practically possible. Some of the proposals that emanated from pre-legislative scrutiny, such as the issue of non-Garda staff attending interviews, will be dealt with by way of the Garda Síochána powers Bill. The Hamilton review group proposals also are being implemented but if there are any constructive suggestions that can be made that will enhance this legislation, we will certainly look at them with an open mind.

I do not think that anybody holds a candle to people who commit fraud or white-collar crime. It is wrong and has a huge impact on society from a reputational and economic perspective. It is important that we equip one of the bodies that is charged with the responsibility to tackle this. This legislation is a first step in that process and I look forward to working with all Members of this House, as well as Members of the Seanad, to ensure that we establish a body that is fit for purpose so that individuals who commit white-collar crime and who have managed to escape sanction in the past will not be able to escape such sanction in the future.

Question put and agreed to.