Dáil Éireann Debate, Wednesday - 8 October 2014
48. Deputy Clare Daly asked the Minister for Finance his views on the fact that a non-Governmental organisation (details supplied) operating here and funded by a membership entirely located here, can have its banking services terminated at short notice because of the decision of an American company which a bank is using to process financial transactions which are wholly transacted between Irish bank accounts by persons resident here. [38366/14]
View answer49. Deputy Clare Daly asked the Minister for Finance if an Irish bank refuses to provide banking services to an organisation (details supplied) as a result of US banking regulations administered by the US Office of Foreign Assets Control, if he will prosecute them in accordance with Irish and European law prohibiting the extraterritorial application of US law in relation to the illegal US blockade of Cuba. [38367/14]
View answer58. Deputy Clare Daly asked the Minister for Finance the emergency facilities he will make available to allow an organisation (details supplied) to operate a functioning Irish bank account with cheque clearing and electronic transfer facilities whilst prosecutions are being undertaken. [38368/14]
View answerI propose to take Questions Nos. 48, 49 and 58 together.
The Deputy is aware that I have responded to a number of recent Parliamentary Questions on this same topic and, for the benefit of the Deputy, I include the substance of my previous responses in the following:
I have no direct role in the relationship between banks and their customers. Neither have I a statutory function in relation to banking decisions made by individual lending institutions at any particular time as these decisions are taken by the Board and Management of the relevant institution. Accordingly, the banking facilities of an individual customer, or organisation, is a matter entirely for that individual, or organisation, to arrange. A Relationship Framework has been specified that defines the nature of the relationship between the Minister for Finance and each bank. These Frameworks were published on 30 March 2012 and can be found at: http://banking.finance.gov.ie/presentations-and-latest-documents/.
Notwithstanding this, officials in my Department have referred the issue to Bank of Ireland and have received the following comment in this regard:
"The US Government has a restrictive trade embargo against Cuba. The US legislative and regulatory measures include an embargo on making or receiving payments from Cuba and/or facilitating the making or receiving of payments from Cuba.
Bank of Ireland depends on correspondent banks for the processing of our national, European and international transactions, including our SEPA (Single European Payment Area) transactions. We are reliant on our correspondent banks because they process and facilitate all such transactions on our behalf. The current issue has arisen as a result of the transition to SEPA. As it happens, our principal correspondent bank for SEPA transactions is a leading US bank who must comply with its own regulatory requirements and obligations to avoid a possible exposure to regulatory sanctions and penalties.
As a result, we are not in a position to process such transactions. This affects all international payments to or from Cuba and also any related SEPA payments."
The Deputy may be aware that a breach of the relevant regulatory requirements can have severe consequences for an institution and the following link refers to one recent high profile case, which was reported in the international financial media, in this regard:
http://www.reuters.com/article/2014/07/01/us-bnp-paribas-settlement-idUSKBN0F52HA20140701
Finally, I have also been asked previously if I, as Minister for Finance, would challenge relevant U.S. policy. My response, which has not changed, is to highlight that US policy in this regard is not restricted to Ireland and extends worldwide and accordingly I do not intend to challenge this policy as I would not expect a positive outcome to such an action. In the same vein neither do I believe it to be appropriate for me to undertake a prosecution in relation to this matter as you suggest.
