Vol. 444 No. 2
I observe that amendments Nos. 4, 8, 15 and 17 are consequental on amendments Nos. 2 and 3 and amendment No. 14 is related to amendment No. 1. I suggest, therefore, that amendments Nos. 1, 2, 3, 4, 8, 14, 15 and 17 be discussed together. Is that satisfactory? Agreed.
SECTION 3.
I move that the Committee agree with the Seanad in amendment No. 1:
In page 11, subsection (16), lines 17 and 18, paragraph (f) deleted and the following substituted:
"(f) proceedings for an offence are concluded—
(i) when the defendant is acquitted on all counts;
(ii) if he is convicted on one or more counts, but no application for a confiscation order is made against him or the court decides not to make confiscation order in his case; or
(iii) if a confiscation order is made against him in connection with those proceedings, when the order is satisfied,
(g) an application under section 7 or 11 of this Act is concluded—
(i) if the court decides not to make a confiscation order against the defendant, when it makes that decision; or
(ii) if a confiscation order is made against the defendant as a result of that application, when the order is satisfied,
(h) an application under section 8 or 14 of this Act is concluded—
(i) if the court decides not to vary the confiscation order in question, when it makes that decision; or
(ii) if the court varies the confiscation order as a result of the application, when the order is satisfied,
(i) a confiscation order is satisfied when no amount is due under it,".
Amendments Nos. 1, 2 and 3 propose to insert new sections 7 and 8 in the Bill. The proposed section 7 will allow a court which has already determined, in the context of an application for a confiscation order under section 4 of the Bill, that a person who has been convicted of drug trafficking has not benefited from such trafficking to reassess that determination and to make a confiscation order in the light of new evidence presented by the Director of Public Prosecutions.
The proposed section 8 will enable the Director of Public Prosecutions to ask a court which has made a confiscation order against a person convicted of drug trafficking to reassess the value of that drug trafficking if fresh evidence becomes available.
The other amendments are merely consequential.
The net effect of these amendments will be to strengthen the Bill in two ways. First, it will enable the Director of Public Prosecutions to go back to a court which has refused to make a confiscation order with fresh evidence and ask it to make a confiscation order in the light of that evidence. Second, in cases where a confiscation order has been made for a certain amount and the Director of Public Prosecutions subsequently finds new evidence which suggests that the amount was insufficient, he can ask the court to reassess the order with a view to increasing the amount. This is the kernel of amendments Nos. 1, 2 and 3 and the other amendments are simply related.
(Carlow-Kilkenny): I welcome the inclusion in the Bill of any provision which will ensure that those who deal in drugs suffer to the fullest extent possible. I would be worried that a wrong assessment could be made at any stage and I welcome the provision which will enable the Director of Public Prosecutions to come back to the court at a later stage with fresh evidence that the assets from the drug trafficking were more valuable than they first appeared. It is only proper that those who cause so much suffering and hardship to people should be made suffer to the fullest possible extent.
I, too, welcome these amendments. The further flexibility being given to the Director of Public Prosecutions in such proceedings will be very useful. As was pointed out on Committee Stage, there is no end to the creativity of the criminal mind. Some criminals who have been convicted of serious crimes have stashed away large amounts of money and I welcome the power being given to the Director of Public Prosecutions to come back to court with fresh evidence at a later stage. I congratulate the Seanad for accepting this amendment.
I move that the Committee agree with the Seanad in amendment No. 2:
NEW SECTION.
In page 13, before section 7, the following new section inserted:
7.—(1) This section applies where an application has previously been made to a court under section 4 of this Act and the court has determined that the defendant has not benefited from drug trafficking.
(2) If the Director of Public Prosecutions has evidence—
(a) which was not considered by the court in making the determination referred to in subsection (1) of this section, but
(b) which the Director of Public Prosecutions believes would have led the court to determine that the defendant had benefited from drug trafficking if it had been considered by the court, he may make, or cause to be made, an application to the court for it to consider that evidence.
(3) If, having considered the evidence, the court is satisfied that it would have determined that the defendant had benefited from drug trafficking if that evidence had been available to it, the court—
(a) shall—
(i) make a fresh determination of whether the defendant benefited from drug trafficking; and
(ii) make a determination under section 4 (4) of this Act of the amount to be recovered by virtue of that section; and
(b) may make a confiscation order under section 4 (4) of this Act.
(4) In considering an application under this section the court may take into account any payment or other reward received by the defendant on or after the determination referred to in subsection (1) of this section, but only if the Director of Public Prosecutions shows that it was received by the defendant in connection with drug trafficking carried on by the defendant or another on or before that date.
(5) In considering any evidence under this section which relates to any payments or reward to which subsection (4) of this section applies, the court shall not make the assumptions which would otherwise be required by section 5 of this Act.
(6) No application shall be entertained by the court under this section if it is made after the end of the period of six years beginning with the date on which the defendant was convicted.
I move that the Committee agree with the Seanad in amendment No. 3:
NEW SECTION.
In page 13, before section 7, the following new section inserted:
8.—(1) This section applies where a court has made a determination under section 4 (4) of this Act of the amount to be recovered in a particular case by virtue of that section referred to in this section as "the current determination".
(2) Where the Director of Public Prosecutions is of the opinion that the real value of the defendant's proceeds of drug trafficking was greater than their assessed value, the Director of Public Prosecutions may make, or cause to be made, an application to the court for the evidence on which he has formed his opinion to be considered by the court.
(3) In subsection (2) of this section—
"assessed value" means the value of the defendant's proceeds of drug trafficking as assessed by the court under section 6 (1) of this Act; and
"real value" means the value of the defendant's proceeds of drug trafficking which took place—
(a) in the period by reference to which the current determination was made;
or
(b) in any earlier period.
(4) If, having considered the evidence, the court is satisfied that the real value of the defendant's proceeds of drug trafficking is greater than their assessed value (whether because the real value was higher at the time of the current determination than was thought or because the value of the proceeds in question has subsequently increased), the court shall make a fresh determination under section 4 (4) of this Act of the amount to be recovered by virtue of that section.
(5) Any determination under section 4 (4) of this Act by virtue of this section shall be by reference to the amount that might be realised at the time when the determination is made.
(6) For any determination under section 4 (4) of this Act by virtue of this section, section 5 (5) of this Act shall not apply in relation to any of the defendant's proceeds of drug trafficking taken into account in respect of the current determination.
(7) In relation to any such determination—
(a) section 3 (2) of this Act shall have effect as if for "a confiscation order is made against the defendant" there were substituted "of the determination";
(b) sections 3 (8), 8 (4) (a) and 10 (4) of this Act shall have effect as if for "confiscation order" there were substituted `determination'; and
(c) section 6 (2) of this Act shall have effect as if for "confiscation order is made" there were substituted "determination is made".
(8) The court may take into account any payment or other reward received by the defendant on or after the date of the current determination, but only if the Director of Public Prosecutions shows that it was received by the defendant in connection with drug trafficking carried on by the defendant or another on or before that date.
(9) In considering any evidence under this section which relates to any payment or reward to which subsection (8) of this section applies, the court shall not make the assumptions which would otherwise be required by section 5 of this Act.
(10) If, as a result of making the fresh determination required by subsection (4) of this section, the amount to be recovered exceeds the amount set by the current determination, the court may substitute for the amount to be recovered under the confiscation order which was made by reference to the current determination such greater amount as it thinks just in all circumstances of the case.
(11) No application shall be entertained by the court under this section if it is made after the end of the period of six years beginning with the date on which the defendant was convicted.
I move that the Committee agree with the Seanad in amendment No. 4:
In page 14, subsection (1), paragraph (a), lines 9 and 10, "section 4 or section 7" deleted and "section 4, 7, 8, or 9", substituted.
Amendment No. 5. I observe that amendment No. 6 is consequential and amendment No. 7 is related. I suggest, therefore, that we discuss amendments Nos. 5, 6 and 7 together. Is that agreed? Agreed.
I move that the Committee agree with the Seanad in amendment No. 5:
In page 14, between lines 26 and 27, the following new subsection inserted:
"(2) Nothing in this section shall prevent the Director of Public Prosecutions from making more than one statement.".
These amendments are designed to finetune the legislation and to correct some defects which were spotted during its passage through the Houses of the Oireachtas. Deputies will be aware that under section 8 the Director of Public Prosecutions can submit a statement of evidence to the court that a person has benefited from his criminal deeds and showing the extent to which he has benefited. The defendant can submit a statement in reply.
As the Bill was drafted, the Director of Public Prosecutions can submit one statement only since the section refers to "a statement". This amendment is designed simply to allow the Director of Public Prosecutions to submit more than one statement if further fresh evidence comes to light and as a corollary, allows the defendant to submit more than one statement by way of response.
Amendment No. 6 is directly consequential on this amendment because it provides that any follow-up statement tendered to the court by the Director of Public Prosecutions will be treated in the same way as his original statement, when the defendant can submit replies and so on. Again, it is merely a finetuning exercise designed to strengthen the legislation.
Seanad amendment No. 6 has already been discussed with amendment No. 5. The Minister of State to move No. 6.
I move that the Committee agree with the Seanad in amendment No. 6:
In page 14, subsection (2), paragraph (a), line 28, after "subsection (1)""or (2)" inserted.
I move that the Committee agree with the Seanad in amendment No. 7:
In page 15, between lines 17 and 18, the following new subsection inserted:
"(5) Nothing in this section shall prevent a defendant from making more than one statement.".
I move that the Committee agree with the Seanad in amendment No. 8:
In page 15, subsection (1), line 30, "section 4 or section 7" deleted and "section 4, 7, 8 or 9," substituted.
Seanad amendment No. 9. I observe that Seanad amendment No. 11 is related and suggest that we discuss them together if that is satisfactory. Agreed.
SECTION 11.
I move that the Committee agree with the Seanad in amendment No. 9:
In page 16, subsection (2), lines 35 and 36, "under this Act" deleted and "under section 4 or section 7 of this Act, in the case respectively of a conviction for a drug trafficking offence or a conviction for an offence other than a drug trafficking offence," substituted.
The purpose of these amendments, again which are largely technical in nature, is to finetune certain sections of the Bill. They clarify further the procedure for the making of confiscation orders under section 11 (2) and (4) of the Bill. Deputies will recall that section 11 (2) enables the High Court to make a confiscation order against a person who, in the first place, has been convicted of drug trafficking or another offence on indictment but who dies or absconds before the confiscation order can be made. Section 11 (4), on the other hand, enables a confiscation order to be made in the case of a defendant in respect of whom criminal proceedings have been instituted on indictment but who absconds before the proceedings have been concluded. In other words, section 11 (2) deals with a person who has been convicted but who absconds or dies before the confiscation order can be made, whereas section 11 (4) deals with the case of a person who has been prosecuted on indictment for an offence that can lead to a confiscation order but who absconds before the proceedings have been concluded.
At present both section 11 (2) and (4) provide that, where the appropriate conditions are fulfilled, the High Court may exercise the powers of a court to make a confiscation order "under this Act". However, they do not refer to the specific powers under the Act which are involved. The Minister has been advised that it might be better to make it clear that in the case of a conviction of proceedings related to drug trafficking, the powers provided in section 4 will apply and that where other offences are at issue, the provisions of section 7 will apply. In other words, we are just tying the relevant powers to the relevant sections which provide those powers. This is the effect of amendments Nos. 9 and 11 which propose the deletion of the words "under this Act" in section 11 (2) and (4) and their replacement by new words along the lines I have indicated. What is involved is simply a clarification and an improvement of the existing text.
I move that the Committee agree with the Seanad in amendment No. 10:
In page 16, subsection (3), line 39, after "offences""in respect of which a confiscation order may be made under this Act" inserted.
This amendment makes it clear that a confiscation order will be made by the High Court only under section 11 (3) against a person who absconds before the conclusion of their trial if that person is being proceeded against on indictment. The making of confiscation orders generally is being restricted to convictions and to proceedings for indictable offences. It is desirable to amend section 11 (3) to make it clear that this principle would apply where a person has absconded.
I move that the Committee agree with the Seanad in amendment No. 11:
In page 16, subsection (4), lines 42 and 43, "under this Act" deleted and "under section 4 or section 7 of this Act, where the relevant proceedings have been instituted respectively in respect of a drug trafficking offence or an offence other than a drug trafficking offence," substituted.
I move that the Committee agree with the Seanad in amendment No. 12:
In page 17, before section 13, the following new section inserted:
.—(1) An appeal against the making of a confiscation order shall lie to the Court of Criminal Appeal.
(2) If it upholds the appeal, in whole or in part, the court may, on an application by a person who held property which was realisable property, order compensation to be paid to the applicant if—
(a) it is satisfied that the applicant has suffered loss as a result of the making of the confiscation order; and
(b) having regard to all the circumstances of the case, the court considers it to be appropriate.
(3) The amount of compensation to be paid under this section shall be such as the court considers just in all the circumstances of the case.".
Again, this amendment is designed to improve the legislation and fill a gap we discovered therein. Normally an appeal against a criminal conviction is made to the Court of Criminal Appeal. Strictly speaking a confiscation order does not form part of that appeal. One can appeal the conviction or the sentence, but a confiscation is something different again from either the conviction or sentence. Therefore, we had to provide some mechanism for somebody who wanted specifically to appeal a compensation order, which is what this amendment is designed to do.
(Carlow-Kilkenny): I suppose we must strike a balance and allow everybody an opportunity to appeal decisions taken. May I ask the actual meaning of the phraseology in subparagraph (1) of the amendment, which says:
An appeal against the making of a confiscation order shall lie to the Court of Criminal Appeal.
Is that legal jargon or gobbledygook? Is that normal language? Is that a mistake?
It is not a mistake. I have sympathy with Deputy Browne, but I am informed that when an appeal procedure mechanism is provided in legislation, this is the standard language used, that it is preferable to the adhere to the usual standard language rather than depart therefrom for no obvious reason.
Is it the case that in the Bill as passed by the Dáil no appeal was envisaged until this was pointed out in the Seanad?
In theory all decisions are appealable to the High Court but, to use the Shakespearean terminology this phrase was used to make assurance doubly sure and ensure there is a specific appeal mechanism in place in the legislation. In any event the amount of a confiscation order was appealable in theory to the High Court. It was pointed out to us in the Seanad that there was no specific provision therefor. Therefore, in response to the very good debate in the Seanad, we decided to insert a specific provision therefor.
I move that the Committee agree with the Seanad in amendment No. 13:
SECTION 14
In page 17, before section 14, the following new section inserted:
(1) This section applies where—
(a) the High Court has made a confiscation order by virtue of section 11 (4) of this Act, and
(b) the defendant has ceased to be an absconder.
(2) If, on an application by the defendant or the Director of Public Prosecutions in respect of the confiscation order, the High Court is satisfied that—
(a) the value of the defendant's proceeds of drug trafficking or his benefit as mentioned in section 7 (4) of this Act in the period by reference to which the determination in question was made ("the original value"), or
(b) the amount that might have been realised at the time the confiscation order was made,
was less than the amount ordered to be paid under the confiscation order, the court—
(i) may make a fresh determination of the value of the defendant's proceeds or benefit under section 4 of this Act in the case of drug trafficking and under section 7 of this Act in the case of an offence other than a drug trafficking offence, and
(ii) may, if it considers it just in all the circumstances, vary the amount to be recovered under the confiscation order.
(3) For any determination under section 4 of this Act by virtue of this section, section 5 (5) shall not apply in relation to any of the defendant's proceeds of drug trafficking taken into account in determining the original value.
(4) Where the court varies a confiscation order under this section it may, on an application by a person who held property which was realisable property, order compensation to be paid to the applicant if—
(a) it is satisfied that the applicant has suffered loss as a result of the making of the confiscation order; and
(b) having regard to all the circumstances of the case, the court considers it to be appropriate.
(5) The amount of compensation to be paid under this section shall be such as the court considers just in all the circumstances of the case.
(6) No application shall be entertained by the court under this section if it is made after the end of the period of six years beginning with the date on which the confiscation order was made.
This amendment enables the defendant or the Director of Public Prosecutions to apply to the High Court to vary a confiscation order made against an absconder under section 11 (4) where the absconder has returned. I will sum it up in my own language; it enables the Director of Public Prosecutions or the defendant to apply to the High Court to vary the amount of a confiscation order made against an absconder in two circumstances in which (a) and (b) occurs. Circumstances (a) is where the absconder returns and (b) in which the court is satisfied that the amount of his or her benefit was overestimated when the confiscation order was made, or that his or her assets are not sufficient to satisfy that order.
Similar provision for the variation of confiscation orders is already included in section 13 where an absconder is not involved.
Provision is also being made for the payment of compensation where the High Court varies a confiscation order made by virtue of section 11 (4) when compensation will be payable to a person who suffered loss as a result of the making of the order.
It is a fairly simple amendment and deals with something which, as Deputy O'Donnell pointed out, should have been dealt with in the Bill as originally drafted; but it is a fairly long, complex Bill and we cannot think of everything.
The matter of the variation of confiscation orders raises the prospect of a whole series of civil cases being taken under this process. While I know it is essential to have that provision, it is really quite a hybrid in that, first, we have the criminal conviction and now these civil proceedings entering the realm of civil litigation. Does the Minister envisage the Director of Public Prosecutions finding himself involved in a whole series of civil variation orders, for example, if the wife or children of the person whose proceeds have been confiscated is or are suffering hardship of varying degrees? In those circumstances does the Minister envisage that the Director of Public Prosecutions will find himself involved in a whole series of cases to change the original judgment of the court, which really forms part of the criminal justice system, in relation to the confiscation order? Is there not a danger that we are drifting into the State's being involved in civil litigation which could be endless in relation to the person whose proceeds have been confiscated?
I agree with Deputy O'Donnell. We are dealing with a hybrid are between the civil and criminal law. In order to succeed, the absconder — who obviously absconded in the first place with good reason — would have to convince the court they subsequently appear before that the original order was wrong. I suppose that is only fair. Nobody's sympathy can be with someone who absconds because almost invariably they do not abscond for a good reason. A person may abscond for one reason or another — maybe through fear for his life — and may not have an opportunity to contest the amount of the confiscation order being made against him, so all the court will hear is the evidence on the State side. This person may return as soon as humanly possible and if the order is too high and he does not have assets to meet it, or if he has not made much money from the nefarious activity we are talking about, it is only reasonable that he should be entitled to go back into court. I would not share Deputy O'Donnell's fears. I do not see this happening on a wide scale. I would be concerned if I thought the courts were going to be clogged by a whole lot of applications but I honestly cannot see it happening.
If a person absconds before he has been convicted of an offence, say of drug trafficking, and absconds from the country to avoid trial or for whatever reason and an order is made confiscating his goods and assets, is this confiscation order made on the presumption that he is guilty because he absconded? Is it the case that if he comes back, faces trial, is found not guilty, the confiscation order will be revoked?
Yes, that would be a correct interpretation.
Carlow-Kilkenny): If the previous amendment provides a special appeal against confiscation where the order can be varied in whole or in part, why is there a need for this section to come immediately afterwards allowing for a person absconding? Is it a double blow?
The original section provides a specific mechanism where somebody is taken to court and a confiscation order is made against them by the Central Criminal Court. You appeal that to the Court of Criminal Appeal if you are not happy with the way the court looked at the evidence presented by the DPP as opposed to the evidence presented by yourself, and you feel that the court came to the wrong conclusions on the financial situation. This new section deals with a situation where you were never in any position to contest it because you had left the jurisdiction and you come back some time afterwards.
(Carlow-Kilkenny): Yes, but why——
You could have a situation where you would be out of time, for example, for an appeal in the usual way. That is just one example. It deals with a slightly different situation. Situation A is where the matter was contested and you are not happy with the way the Central Criminal Court applied the law in arriving at the amount. Situation B is where the matter was not contested at all.
I would like the Minister to clarify this notion of the person who absconds or goes missing and is deemed to be guilty in his absence and, therefore, the confiscation proceedings are brought by the State. Does the fact that one is absent and has absconded for whatever reason — it may not even be for the purposes of avoiding trial — mean that that is actually a verdict? Does it stand as one being deemed guilty? Does one have a criminal record for the purposes of the State records?
Yes, you are actually treated as such. I must admit that my initial understanding was wrong because I only came to this question recently. You do not have to be convicted if you abscond. A confiscation order can still be made and I presume that it will be made on the basis that you are guilty even though there is not any verdict against you. As a result of what we are introducing now, you can go into court when you come back and have that changed if you have evidence on which it can be changed.
Or stand trial.
Or stand trial, yes.
I move that the Committee agree with the Seanad in amendment No. 14:
Section 16: In page 19, subsection (1), lines 4 and 5, paragraph (c) deleted and the following substituted:
"(c) the confiscation order has not been satisfied,".
I move that the Committee agree with the Seanad in amendment No. 15:
In page 20, lines 7 to 51 deleted and the following new section substituted:
19. —(1) The powers conferred on the High Court by section 20 of this Act shall be exercisable where—
(a) (i) proceedings have been instituted in the State against the defendant for an offence which is a drug trafficking offence or an indictable offence other than a drug trafficking offence or an application has been made in respect of the defendant under section 7, 8, 11 or 14 of this Act,
(ii) the proceedings or the application have not or has not been concluded, and
(iii) either a confiscation order has been made or it appears to the court that there are reasonable grounds for thinking that a confiscation order may be made in the proceedings or that in the case of an application under section 7, 8, 11 or 14 of this Act the court will be satisfied, as the case may be, as mentioned in section 7 (3), 8 (4), 11 (2), 11 (4) or 14 (2) of this Act,
or
(b) (i) the court is satisfied that proceedings are to be instituted against a person in respect of an offence which is a drug trafficking offence or an offence in respect of which a confiscation order might be made under section 9 of this Act or that an application of a kind mentioned in subsection 1 (a) (i) of this section is to be made in respect of a person, and
(ii) it appears to the court that a confiscation order may be made in connection with the offence or that a court will be satisfied as mentioned in subsection 1 (a) (iii) of this section.
(2) For the purposes of section 20 of this Act, at any time when those powers are exercisable before proceedings have been instituted—
(a) references in this Act to the defendant shall be construed as references to the person referred to in subsection (1) (b) (i) of this section, and
(b) references in this Act to realisable property shall be construed as if, immediately before that time, proceedings had been instituted against the person referred to in subsection (1) (b) (i) of this section for an offence which is a drug trafficking offence or an offence in respect of which a confiscation order might be made under section 9 of this Act.
(3) Where the court has made an order under section 20 of this Act by virtue of subsection (1) (b) of this section, the court shall discharge the order if proceedings in respect of the offence are not instituted or the relevant application is not made within such time as the court considers reasonable.
Has the Minister discussed this already?
It has already been discussed with amendment No. 1.
I move that the Committee agree with the Seanad in amendment No. 16.
In page 22, between lines 34 and 35, the following new subsections inserted:
(7) Where a restraint order is made which applies to an interest in a company or to the property of a company, the registrar of the High Court shall furnish the Registrar of Companies with notice of the order and the Registrar of Companies shall thereupon cause the notice to be entered in the Register of Companies maintained under the Companies Acts, 1963 to 1990.
(8) Where notice of an order has been given under subsection (7) of this section and the order is varied, the registrar of the High Court shall furnish the Registrar of Companies with notice to that effect and the Registrar of Companies shall thereupon cause the entry made under subsection (7) of this section to be varied to that effect.
(9) Where notice of an order has been given under subsection (7) of this section and the order is discharged, the registrar of the High Court shall furnish the Registrar of Companies with notice to that effect and the Registrar of Companies shall thereupon cancel the entry made under subsection (7) of this section.
This deals with a point raised by Deputy Gay Mitchell when the legislation was in the course of passage through this House. People will be aware of the fact that restraint orders on a person's property can be registered in the Land Registry or the Registry of Deeds. Deputy Mitchell suggested that they should also be registered in the Companies Office. We have taken that on board and have gone quite a bit further than Deputy Mitchell in his original amendment. This is because we have to provide for a situation which Deputy Mitchell did not provide for, even though he gave us the original idea and I give him full credit for that. He did not provide for a situation where notification has to be made of the variation or cancellation of a restraint order. That has to be provided for as well and is so provided for in the amendment in the name of the Minister.
(Carlow-Kilkenny): I am delighted that the wisdom of my senior colleague has been accepted. Maybe he should be listened to more in the future.
We will listen to him when he makes sense.
I move that the Committee agree with the Seanad in amendment No. 17.
In page 23, subsection (3) (a) (ii), lines 35 and 36, "section 11 or 14 of this Act and has not been concluded, or" deleted and "the defendant under section 7, 8, 11 or 14 of this Act and has not been concluded, or" substituted.
Amendments Nos. 19, 20 and 21 are consequential on amendment No. 18 and may be discussed together, by agreement.
SECTION 28.
I move that the Committee agree with the Seanad in amendment No. 18:
In page 27, between lines 23 and 24, the following subsection inserted:
"(2) This section shall apply in respect of the carrying out of one or more of the operations which are included in numbers 2 to 12 and 14 of the list annexed to Council Directive 89/646/EEC, activities to which Council Directive 79/267/EEC as amended applies or any other activity which may be prescribed in regulations made under subsection (9) (b) of this section."
Amendment No. 18 relates to section 28 which deals with money laundering. Section 28 places an obligation on certain bodies to take measures to prevent money laundering through, for example, taking measures to establish the identity of a person for whom they propose to provide a service. The basic approach which this section takes is to specify in subsection (1) the institutions on which these obligations are placed. As well as mentioning specific institutions there is a power to prescribe other persons or bodies in regulations. As the House will be aware, the section arises primarily in the context of giving effect to the EU directive on money laundering.
In relation to section 28 there is general agreement that the approach it contains is basically sound, but certain improvements were suggested which we are bringing forward in the amendments. The main effect of these amendments is to enshrine in the section a specific reference to the services covered by the EU directive on money laundering. The directive defines those services by reference to two other directives and both of these are mentioned specifically in the amendments. This will put beyond doubt the ability of the legislation to implement in full the money laundering directive. In addition a power is being given to prescribe by regulation activities which will be brought within the scope of the reporting requirements of section 28. This will mean that in practical terms if it comes to light that certain activities are not already covered by the section which are liable to be used for money laundering then the reporting requirements of section 28 can be extended to them. While the basic approach of section 28 is being retained, I believe the amendments are practical improvements to it and I trust they will be accepted by the House.
It is quite obvious what we are doing here. In relation to money laundering, an obligation is placed on certain banks, financial institutions, etc., to report matters relating to certain activities but those activities have not been spelt out. We are now spelling them our specifically and giving ourselves the power to prescribe others if other types of financial services come on stream which could, in effect, amount to money laundering. That is simply what we are providing for there.
This is a good and necessary amendment. There was recent controversy about the procedures entered into when granting passports in return for investment in the State. I tabled a parliamentary question to the Minister for Justice asking what procedures are taken to inquire into the criminality or otherwise of anybody who seeks to invest in the State in return for a passport. The Minister should clarify whether there are any procedures whereby the Garda, the IDA or the Department of Justice make routine official inquiries into whether people investing in Ireland with the purpose of obtaining passports have criminal records.
I have no knowledge of that procedure but if Deputy O'Donnell has tabled a parliamentary question it will be answered.
At the time of the controversy the Minister for Justice, in response not to a Dáil question but to a media query, admitted there were no procedures for checking whether a medical doctor from the United States, who applied under the scheme, had a criminal record and no such investigation was carried out. This is important because investment coming into the State could be tainted with criminality. The Bill deals with money laundering and it is relevant to deal with the dangers inherent in such schemes if there is no investigation of whether investors have criminal records.
I have nothing to say on this.
I move that the Committee agree with the Seanad in amendment No. 19:
In page 27, lines 26 and 27 deleted and "of a kind mentioned in subsection (2) of this section" substituted.
I move that the Committee agree with the Seanad in amendment No. 20:
In page 27, line 42 deleted and "kind mentioned in subsection (2) of this section" substituted.
I move that the Committee agree with the Seanad in amendment No. 21:
In page 29, between lines 2 and 3, the following paragraph inserted:
"(b) following consultation with the Minister for Finance, prescribe activities for the purposes of subsection (2) of this section which appear to the Minister to be liable to be used for the purpose of committing or facilitating the commission of offences under section 27 of this Act or any corresponding or similar offences under the law of any other country or territory,".
Amendment Nos. 22 to 29, inclusive, form a composite proposal.
I move that the Committee agree with the Seanad in amendment No. 22:
SECTION 34.
In page 31, before section 34 (but in Part V), the following new section inserted:
"PART VI
Drug Trafficking Money Imported or Exported in Cash.
34. —(1) A member of the Garda Síochána or an officer of customs and excise may seize and, in accordance with this section, detain any cash which is being imported into or exported from the State if its amount is not less than the prescribed sum and he has reasonable grounds for suspecting that it directly or indirectly represents any person's proceeds of, or is intended by any person for use in, drug trafficking.
(2) Cash seized by virtue of this section shall not be detained for more than forty-eight hours unless its detention beyond forty-eight hours is authorised by an order made by a judge of the District Court and no such order shall be made unless the judge is satisfied—
(a) that there are reasonable grounds for the suspicion mentioned in subsection (1) of this section, and
(b) that detention of the cash beyond forty-eight hours is justified while its origin or derivation is further investigated or consideration is given to the institution (whether in the State or elsewhere) of criminal proceedings against any person for an offence with which the cash is connected.
(3) Any order under subsection (2) of this section shall authorise the continued detention of the cash to which it relates for such period, not exceeding three months beginning with the date of the order, as may be specified in the order, and a judge of the District Court, if satisfied as to the matters mentioned in that subsection, may thereafter from time to time by order authorise the further detention of the cash but so that—
(a) no period of detention specified in such an order, shall exceed three months beginning with the date of the order; and
(b) the total period of detention shall not exceed two years from the date of the order under subsection (2) of this section.
(4) Any application for an order under subsection (2) or (3) of this section may be made by a member of the Garda Síochána or an officer of customs and excise.
(5) At any time while cash is detained by virtue of the foregoing provisions of this section a judge of the District Court may direct its release if satisfied—
(a) on an application made by the person from whom it was seized or a person by or on whose behalf it was being imported or exported, that there are no, or are no longer, any such grounds for its detention as are mentioned in subsection (2) of this section, or
(b) on an application made by any other person, that detention of the cash is not for that or any other reason justified.
(6) If at a time when any cash is being detained by virtue of the foregoing provisions of this section—
(a) an application for its forfeiture is made under section 35 of this Act; or
(b) proceedings are instituted (whether in the State or elsewhere) against any person for an offence with which the cash is connected,
the cash shall not be released until any proceedings pursuant to the application or, as the case may be, the proceedings for that offence have been concluded.".
The purpose of these amendments is to make provision for the seizure of cash relating to drug trafficking which is being imported into or exported out of the State. As Deputies are aware, large amounts of cash are generated by drug trafficking and supplies of illegal drugs are frequently purchased in cash. As a result, consignments of money which are derived from or intended for use in drug trafficking are moved across international borders. With the removal of exchange controls in this country, our authorities are not in a position to seize these consignments where they are detected, which is an appalling gap in the law. This situation needs to be addressed and this is what is proposed in these amendments. I should acknowledge at this stage that amendments which are designed to have the same effect as the amendments in the Minister's name were put down by Deputy Gay Mitchell and Deputy O'Donnell for Committee Stage. However, their scope was effectively limited to the seizure of suspicious cash and they did not make provision for the additional measures such as forfeiture of such cash, which are also required in this context.
On Committee Stage the Minister explained that she was not prepared to go down this road in advance of having available to her the report of a senior official of her Department, which, among other things, would consider whether customs officers or the Garda should have such powers. The report has now been submitted to the Minister and it recommends that powers along the lines contained in those amendments should be available. While she has not completed her consideration of the other matters in that report, she is happy, having considered this aspect, to put forward this amendment.
The amendments comprise eight proposed new sections 34 to 41, which will form a new Part VI of the Bill. The proposed new section 34 provides for the detention and seizure by a garda or a customs officer of cash which is being imported into or exported from the State, provided the amount is not less than a certain amount to be prescribed under the proposed section 40 and provided the garda or customs officer has reasonable grounds for suspecting that it is derived from or intended for use in drug trafficking. An order from the District Court will be required to enable the cash to be detained beyond 48 hours. An order for continued detention of the cash may be made by that court for a period of up to three months and further such orders may be made for a total period of two years. A person from whom the cash was seized will be entitled to apply to a district justice for its release. The cash will not be released if its forfeiture is being sought under section 35 or proceedings are being taken against a person for an offence connected with the cash.
The proposed new section 35 allows a Circuit Court judge to order the forfeiture of cash held under section 34 if he or she is satisfied on an application by the Director of Public Prosecutions, while the cash is still detained, that it represents drug trafficking proceeds or was intended for use in drug trafficking. The civil standards of proof will apply in respect of an application under that section.
The proposed section 36 provides for appeals to the High Court against forfeiture orders made under section 35. Again, the civil standard of proof will apply. The proposed section 37 requires cash detained for more than 48 hours to be placed in an interest bearing account. The interest will be added to the cash upon its forfeiture or release. The proposed section 38 provides for the giving of notice of orders made by a district judge authorising the continuing detention of cash under section 34 (2) and for procedural matters. The proposed section 39 contains definitions for the purposes of the new Part VI. The proposed section 40 sets out a procedure for prescribing the amount of cash in relation to which the power of seizure under section 34 will apply. The proposed section 41 provides in standard form for the disposal of money forfeited under section 35.
As I have indicated, there is a need to ensure that appropriate action can be taken to deal with the importation or exportation of cash which is connected with drug trafficking and I believe the measures which are provided for in these amendments can play an important part in enabling the Garda and customs officers to deal with that problem.
(Carlow-Kilkenny): We welcome the amendment because if the people who are making money out of drug trafficking can be hit, they will eventually be put out of business. They are in business only to make money at the terrible cost of the lives of those who take drugs. The provision for an appeal will protect innocent people who may wrongly be under suspicion because they have a large amount of money which may be thought to have been derived from the sale of drugs. The amendment should help to deal with drug traffickers.
I welcome the amendment. The Bill needed strengthening and I am glad the Minister brought forward this amendment from the Seanad and that we have the opportunity to mention how welcome and radical this Bill is. It does not pull its punches. It is draconian in the powers it gives to the State to deal with offences such as drug trafficking. It reduces the burden and obstruction which can face the State in detecting and dealing with drug trafficking by reducing the burden of proof to the civil standard, which is on the balance of probabilities. It is generally not recognised outside legal circles that the criminal standard of proof is beyond a reasonable doubt and the civil standard of proof is on the balance of probabilities. This at last tips the balance in favour of the State in its effort to counter the long-standing principle that crime pays. The thrust of this legislation is radical and my party strenuously supports and endorses it. It is absolutely necessary that such radical and draconian powers be given to the State in relation to the seizure of cash, given the style of this type of criminal activity.
We are not only talking about moneys in suitcases. We are also talking about huge sums of money which, with the aid of up to date technological advances, can be transferred by the flick of a switch right around the world and money laundered in a couple of weeks. This enhanced power is to be welcomed given the territory with which we are dealing and the havoc in our inner cities which is a direct result of the greed of this type of criminal.
I thank Deputies for their welcome for this measure which will considerably strengthen the Bill. I acknowledge the contribution made to this by the Opposition spokespersons who indicated the need for it in the course of the passage of the Bill. It raised a number of matters which we had to consider. I am glad we have been able to put it together and that it will represent a considerable strengthening and improvement of the Bill.
I move that the Committee agree with the Seanad in amendment No. 23:
In page 31, before section 34 (but in Part V), the following new section inserted:
35. —(1) A judge of the Circuit Court may order the forfeiture of any cash which has been seized under section 34 of this Act if satisfied, on an application made while the cash is detained under that section, that the cash directly or indirectly represents any person's proceeds of, or is intended by any person for use in, drug trafficking.
(2) Any application under this section shall be made, or caused to be made, by the Director of Public Prosecutions.
(3) The standard of proof in proceedings on an application under this section shall be that applicable to civil proceedings; and an order may be made under this section whether or not proceedings are brought against any person for an offence with which the cash in question is connected.
I move that the Committee agree with the Seanad in amendment No. 24:
In page 31, before section 34 (but in Part V), the following new section inserted:
36. —(1) This section applies where an order for the forfeiture of cash (in this section known as "the section 35 order") is made under section 35 of this Act.
(2) Any party to the proceedings in which the section 35 order is made (other than the Director of Public Prosecutions) may, before the end of the period of 30 days beginning with the date on which it is made, appeal in respect of the order to the High Court.
(3) An appeal under this section shall be by way of a rehearing.
(4) On an application made by the appellant to a judge of the Circuit Court at any time, the judge may order the release of so much of the cash to which the section 35 order relates as he considers appropriate to enable the appellant to meet his legal expenses in connection with the appeal.
(5) When hearing an appeal under this section the High Court may make such order as it considers appropriate.
(6) If it upholds the appeal, the judge may order the release of the cash, or (as the case may be) the remaining cash, together with any accrued interest.
(7) Section 35 (3) of this Act shall apply in relation to a rehearing on an appeal under this section as it applies to proceedings under section 35 of this Act.
Seanad amendment No. 25 has already been discussed with amendment No. 22.
NEW SECTION.
I move that the committee agree with the Seanad in amendment No. 25:
In page 31, before section 34 (but in Part V), the following new section inserted:
37. —Cash seized under this Part of this Act and detained for more than forty-eight hours shall, unless required as evidence of an offence, be held in an interest-bearing account and the interest accruing on any such cash shall be added to that cash on its forfeiture or release.".
I move that the Committee agree with the Seanad in amendment No. 26:
In page 31, before section 34 (but in Part V), the following new section inserted:
38. —(1) An order under section 34 (2) of this Act shall provide for notice to be given to persons affected by the order.
(2) Provision may be made by rules of court with respect to applications or appeals to any court under this Part of this Act, for the giving of notice of such applications or appeals to persons affected, for the joinder of such persons as parties and generally with respect to the procedure under this Part of this Act before any court".
I move that the Committee agree with the Seanad in amendment No. 27:
In page 31, before section 34 (but in Part V), the following new section inserted:
39. —(1) In this Part of this Act—
"cash" includes coins and notes in any currency;
"exported" in relation to any cash, includes its being brought to any place in the State for the purpose of being exported.
(2) In section 34 of this Act "the prescribed sum" means such sum as may for the time being be prescribed for the purposes of that section by any regulations made under section 40 of this Act.
I move that the Committee agree with the Seanad in amendment No. 28:
In page 31, before section 34 (but in Part V), the following new section inserted:
40. —(1) The Minister may by regulations prescribe a sum for the purposes of section 34 of this Act and in determining under that section whether an amount of foreign currency is not less than the prescribed sum that amount shall be converted at the prevailing rate of exchange.
(2) Where it is proposed to make regulations under subsection (1) of this section, a draft of the regulations shall be laid before each House of the Oireachtas and the regulations shall not be made until a resolution approving of such draft has been passed by each such House.
Seanad amendment No. 29 has already been discussed with amendment No. 22.
NEW SECTION.
I move that the Committee agree with the Seanad in amendment No. 29:
In page 31, before section 34 (but in Part V), the following new section inserted.
41. —Any money representing cash which is forfeited under this Part of this Act or accrued interest thereon shall, following the payment of any expenses or remuneration that may have arisen in relation to such forfeiture, be paid into or disposed of for the benefit of the Exchequer in accordance with the directions of the Minister for Finance.
I move that the Committee agree with the Seanad in amendment No. 30:
In page 37, subsection (7), between lines 33 and 34, the following new paragraph inserted:
"(d) section 1 (3) (c) of the Extradition (Amendment) Act, 1994.".
This is merely a technical amendment which arises because certain details in relation to extradition which were included in the Bill as originally published have been superseded by the recent enactment of the Extradition (Amendment) Act, 1994. Section 13 (c) of the 1994 Act provides that in certain circumstances the changes to our extradition laws which were made by that Act shall not have effect for the purpose of section 24 of the Extradition Act, 1870 and of section 5 of the Extradition Act, 1873, both of which relate to the obtaining of evidence in the State for use in foreign criminal proceedings.
As Deputies will be aware, section 24 of the 1870 Act and section 5 of the 1873 Act are being replaced and repealed by section 39 of the Bill. This means that section 13 (c) of the new extradition Act will no longer be required and, accordingly, this amendment provides for the repeal of that section. All that is involved is a tidying up operation. The amendment does not give rise to any point of substance and because it is merely a technicality I hope that it will be acceptable to the House.
I move that the Committee agree with the Seanad in amendment No. 31:
Section 43: In page 41, between lines 28 and 29, the following subsection inserted:
"(2) Section 50 of this Act shall have effect as if references in that section to drug trafficking or an offence in respect of which a confiscation order might be made under section 7 of this Act included any conduct which is an offence under the law of a country or territory outside the State and would constitute drug trafficking or an offence in respect of which a confiscation order might be made under section 7 of this Act if it had occurred in the State.".
This rather important amendment is filling a gap in the legislation which was brought to our attention during the course of its passage. It arises as a result of discussions which the Minister has had with the Garda authorities since the legislation was debated here and in the Seanad. While the Garda authorities are happy with section 43 to the extent that it deals with searches for material relevant to foreign investigations, they have suggested that it would be desirable to make additional provision in that section in relation to the obtaining of access to information etc. which is held here and is required for the purpose of investigating an offence committed abroad where a strict search would not be required.
As the Bill is drafted the Garda can institute a search to aid an investigation in a foreign country for a defined type of offence. However, the Garda has no parallel power to look for information which might be of assistance to a prosecuting authority in a foreign country. The Garda decided that it was a parallel, that one was a mirror image of the other, and that we should provide for it which is what we are doing. This is strengthening the Bill and providing for further co-operation with foreign authorities.
(Carlow-Kilkenny): Does it mean that a drug trafficking offence which is an offence in another country will automatically be accepted here as an offence? Are there any constitutional problems involved?
Yes, it will for the purposes of co-operation with other countries. Obviously, the application will have to be made to the court here and the court will look at the law in the other country to see whether the offence is covered by the terms of what we are providing for here. We are dealing here with foreign co-operation and we will ask whoever makes the application to justify it. However, presumably the court will also have access to the legislation under which the offence has been created.
(Carlow-Kilkenny): I welcome the principle. However, for example, the consumption of alcohol is a major offence in some countries. Is there any danger that offences in a foreign country which might not be regarded as a serious offence in this jurisdiction could be used, for example, to convict somebody in Saudi Arabia who was having a pint of beer on the quiet? I know that is not drug trafficking.
I know that this legislation was originally introduced to bring us into compliance with various EU directives and international conventions. However, this whole aspect of the blurring of borders and the need for Europe, in particular, to harmonise its drug enforcement agency laws is brought to light through this amendment. As the Minister said, it will be necessary before such powers can be exercised by the Garda to clarify whether, for example, the law in Holland or Belgium on drugs is similar to our legislation.
Are there not implications for perhaps a future directive on the harmonisation of drug enforcement in Europe, given that although we no longer have specific borders and the move is in Europe to do away with borders, there will remain culture differences between the member states on, for example, the use of soft drugs and the criminality of their possession? Will the Minister make a general statement on that point?
I fully accept the sentiments expressed by Deputy O'Donnell on harmonisation. If one looks at the various legislative provisions throughout the EU one will find that with regard to the sort of offence which we are talking about — a drug trafficking offence which could lead to a confiscation order here — the law is fairly similar in other countries. In some EU countries certain substances which are illegal here have been legalised. However, the provisions on the general law on trafficking in substances which are illegal are fairly similar across the EU. I am not aware of any country which is wildly dissimilar to what we have.
I move that the Committee agree with the Seanad in amendment No. 32:
In page 42, before section 44 (but in Part VI), the following new section inserted:
(1) The Government may by regulations make such modifications of this Act as appear to it to be necessary or expedient for the purpose of adapting any of the provisions of this Part of this Act to enable the State to provide co-operation under those provisions for an international tribunal or other body established for the prosecution of persons responsible for serious violations of international humanitarian law committed outside the State.
(2) Where it is proposed to make regulations under subsection (1) of this section, a draft of the regulations shall be laid before each House of the Oireachtas and the regulations shall not be made until a resolution approving of such draft has been passed by each such House.
This is an important amendment from the international point of view. The primary purpose of this amendment is to enable this country to comply with certain obligations which apply to us in relation to the establishment of a special international tribunal to deal with war crimes in the former Yugoslavia. As Deputies may be aware, the tribunal has been established by a United Nations resolution which requires states to provide the tribunal with assistance in its investigation and other work. A number of such forms of assistance are provided for in Part VI of the Bill in respect of international co-operation in criminal matters, for example, the taking of evidence for foreign courts and so on. However, as Deputies will recall, Part VI only applies in the context of co-operation between States at present. We thought it best therefore to take the opportunity presented by this Bill to enable us enshrine in our legislation a capacity to co-operate fully with tribunals set up to deal with the type of unspeakable and horrific war crimes that have been committed in former Yugoslavia.
We propose to amend the Bill to enable the modification of Part VI by way of Government regulation which will allow appropriate assistance to be made available to the United Nations tribunal and any body which may be set up in the future to prosecute persons responsible for war crimes or other serious violations of human rights. Given that in particular circumstances fairly extensive modifications to Part VI may be required for that purpose, the amendment also provides that any regulations made by the Government in this respect must be approved in draft by each House of the Oireachtas. I commend the amendment to the House.
This is an interesting amendment. I am surprised to see it in the context of this Bill although, as the Minister said, it is necessary particularly in view of the conflict in former Yugoslavia. It is also necessary if agreement is reached and a solution found to the problems in former Yugoslavia. People who are interested in human rights here and throughout Europe believe there is a danger that, in the context of any agreement, an amnesty will be granted to those who committed war crimes.
A similar situation exists in the North of Ireland. If there is a settlement of the conflict there there is a danger of a general amnesty which would be very hurtful to those whose loved ones and spouses have been murdered in the context of political terrorism. It is important that we, as a key member of the European Union, take a stand and enshrine in our legislation a commitment to involvement in and co-operation with any war crimes tribunal. The horrific and unspeakable acts of genocide which have occurred are well documented, or are being documented, by a special committee of the UN.
There is a general worry that in any agreement there will be an institutionalised effort to forgive and forget. The scale of the horrors in former Yugoslavia cannot be obliterated from European consciousness by such an amnesty. We should stand firm. All the parties in this House have, in debates with the Tánaiste and Minister for Foreign Affairs, stood firm in a commitment that, if there is a settlement, there will be an international tribunal to bring to trial those who committed gross and unspeakable acts of inhumanity against their fellow citizens in former Yugoslavia. I welcome this excellent amendment.
I agree with many of Deputy O'Donnell's comments. Some of the points are tangential to the provisions of this Bill but I support what she said. It is hard to disagree with her remarks and I will certainly bring them to the attention of the Tánaiste and Minister for Foreign Affairs.
I move that the Committee agree with the Seanad in amendment No. 33:
Section 44: In page 43, between lines 6 and 7, the following new subsections inserted:
"(3) A report may be made to the Garda Síochána under this section in accordance with an internal reporting procedure established by an employer for the purpose of facilitating the operation of this section.
(4) In the case of a person who was in employment at the relevant time, it shall be a defence to a charge of committing an offence under this section that the person charged made a report of the type referred to in subsection (1) or (2) of this section, as the case may be, to another person in accordance with an internal reporting procedure established for the purpose specified in subsection (3) of this section.".
The purpose of this amendment is to enable reports of transactions made to the Garda Síochána under section 44 of the Bill, where there is a suspicion of money laundering, to be made in accordance with internal control procedures established by an employer to facilitate the operation of section 44. Many employers will establish such formal procedures.
Deputy Mitchell proposed a similar amendment on Committee Stage. In response to that amendment the Minister indicated that she accepted in principle what the Deputy was trying to achieve and that she would be prepared, in consultation with garda authorities and other parties, to introduce an amendment to deal with the matter. The amendment I am proposing today fulfils that commitment. I commend Deputy Mitchell for bringing this to our attention. There is a strong need for it.
It would be preferable if financial institutions established procedures to operate section 44 where a designated person in the institution would make a report. This would be infinitely preferable to having every employee ringing Garda headquarters or their local garda station whenever they saw anything they thought was suspicious. Such a system would be unworkable. We anticipate a situation where the financial institutions will provide their own mechanism and a designated person or persons who will make the report after compliance with the internal reporting procedure.
The amendment also provides a necessary corollary which is to protect an employee who makes an appropriate report in accordance with internal control procedures established by their employer from conviction for an offence of failing to make a report under section 44. The employee will only have to bring it to the attention of somebody internally. If it is found that an offence was committed and the gardaí were not appraised of the matter the employee should not be held responsible if a procedure was in place and the employee did what he or she was required to do. This provision gives employees a specific defence.
(Carlow-Kilkenny): When we discussed this previously we expressed a worry that genuine employees might be found guilty of something of which they were unaware. The debate centred on whether they should be aware. A situation could arise where every employee would become schizophrenic while worrying whether money lodged was the proceeds of drug dealing or whatever. I am glad the overall picture is that individuals may feel free to question whether money lodged came from an illegal source rather than having to quiz the person to know whether they had a winner in Gowran Park or acquired the money through another source. This procedure should save individuals from embarrassment and the risk of committing a criminal offence. They can talk among themselves and whoever is responsible can then weigh up the situation. I welcome the amendment.
On Committee Stage we had a protracted debate about the change in banking culture which will be brought by this Bill. This Bill places an obligation and onus on the banking community to be aware of and be responsible and accountable for transactions in their institutions.
I feared that the bank official would be caught between a rock and a hard place. On one hand he would be guilty of a criminal offence if he did not disclose information about a transaction he thought was suspicious while on the other hand the culture of banking for generations has been based on confidentiality. It is inherent in banking that everything which occurs in the bank is confidential even if there is a suspicion that something might not be above board. Having worked in a bank I am aware of this confidentiality which was endorsed by management and at all levels in the bank. I am gald this amendment addresses this issue and provides that one person be accountable. That person will take the matter further having conducted an internal audit under the new procedural rules which I am sure the banks will draw up for their employees. This is an important area. Although the bank official will be criminalised for not reporting or disclosing a suspicious transaction he might also be afraid that he might leave himself open to a civil suit for slander or libel and we must address that. Does the Minister believe there is adequate protection for the bank official from the possibility that the client might take an action in slander or libel against him if he, in good faith, reports what he deems to be a suspicious transaction under the Act?
Section 44 adds to the protection provided. Deputy O'Donnell's fears are misplaced. I envisage — and we are seeking this result through this amendment — each financial institution establishing a code of conduct and a reporting procedure. The official will report to the deputy manager, supervisor or higher level official that a stranger deposited, for example, £50,000 in cash. The official will know from the rules circulated by the financial institution that such a deposit should be reported. The report will then go through suitable channels to somebody who has been designated, perhaps following a management conference, to bring it to the attention of the Garda.
I do not believe the official need worry about the matter as he will simply be complying with the internal rules of the institution and will be able to state that if he did not act in accordance with the regulations he would put his employment at risk.
It is unlikely that a person who looks like a drug dealer will come into the bank with a big suitcase containing £50,000. It is more likely that the person will be a well established client who regularly deals with the bank. The officials would know the client.
We must get away from the view that money laundering is carried out by people who look like criminals. It is highly sophisticated white collar crime carried out by valued and esteemed members of communities throughout the world. The criminal, whether a drug trafficker or a money launderer, need not look like a criminal. That is why I fear that bank officials might be in fear of their lives and livelihoods about making an allegation if they are not protected from civil suit in that context.
We will deal with internal regulations in the next amendment. I cannot agree with Deputy O'Donnell. My local bank manager in Limerick recently informed me that two gentlemen from London attempted to deposit £2 million in his bank. When he reported the matter to the Garda they contacted the police in London and discovered that there was drug money in London in search of a home. Such things happen. People will go into a bank and take such a chance. However, I accept the Deputy's point that some of the people involved are those one would least suspect of such involvement. That would probably apply in Dublin and in large urban centres. If somebody living in a rural area enjoys a good lifestyle and has no obvious source of income suspicions are aroused.
We discussed this matter with the financial institutions and I am confident that they will put regulations in place which comply with the terms of section 44 and which will be clear enough to let each employee know about their obligation to make a report in certain circumstances. If I am a bank employee and somebody sues me for libel as a result of a report I made to a designated person about a matter which, on investigation by the Garda, was innocent I will be able to say that as an employee of the bank I have obligations under money laundering legislation and under guidelines issued by the bank with which I must comply. I do not think the official has anything to fear. We discussed this with the financial institutions and it is up to them to establish the guidelines and to make them workable and clear so that officials will know their responsibilities.
(Carlow-Kilkenny): We appear to be able to protect the official behind the counter who takes in the money. What is the position of the designated person who reports me to the Garda on foot of a report that I lodged £50,000? What if I discover that my reputation has been damaged? Is the designated person covered?
Rules will apply. We are trying to get at extraordinary transactions which might indicate that the money came from nefarious activities. The banks will take legal advice on the terms of section 44 and will be advised by their lawyers when drafting guidelines.
To make this legislation work there must be an obligation on somebody at some time to report a suspicious transaction. If we pitch it too high and officials are only required to report obvious cases such as I outlined to Deputy O'Donnell earlier — where somebody arrived with bags full of money from no obvious source — the Bill will be unworkable. Money laundering is, in many cases, white collar crime slickly operated by apparently solid citizens. The legislation will obviously be unworkable if we go overboard in trying to protect officials although I realise they must be protected. Working on legal advice and within the framework of the guidelines, personnel in financial institutions are now legally obliged to carry out certain functions if they are not to be prosecuted under section 44. Their lawyers will advise financial institutions on what they must do and on the guidelines which will be issued to officials and to the designated person.
There will always be some danger. However, officials are put under an obligation by section 44 and if they do not comply with its terms they will be criminally liable.
(Carlow-Kilkenny): That is why this issue is so serious. The gun is put to their heads and they must act on suspicion. If it is discovered that somebody lodged ill-gotten money the official will be found guilty because it was his duty to act even though he was not suspicious at the time. That happens when one puts a duty on people to act on suspicion.
The Minister says that section 44 compels them to act. However, a person who wins £100,000 in the prize bonds might wish to keep it a secret from local people and lodge the money in a bank in a different town. I am sure he will resort to court for defamation of character if he discovers that he, as an honest decent citizen, was investigated later. If we oblige bank officials to report these matters there must be some means of protecting them from being found guilty in an action for slander or libel.
The bank is not accusing the person of money laundering, it is only reporting an unusual transaction. Section 44 (4) (b) refers to the body making the report, namely the bank or the designated person in the bank, and says that if the disclosure is made in good faith it shall not be treated as a breach of any restriction upon the disclosure of information imposed by statute or otherwise and shall not involve the person or body making the disclosure ... in liability of any kind.
That is adequate protection.
It indemnifies them against such action.
It indemnifies them so I think the protection is adequate. Section 44 (4) (b) is the relevant provision.
(Carlow-Kilkenny): I do not see the provision mentioned.
It indemnifies them.
Yes, it indemnifies them against disclosures made in good faith.
(Carlow-Kilkenny): The section states that the disclosures shall not be treated as a breach of any restriction on the disclosure of information imposed by statute.
Where is the provision about indemnification?
It is in the amended version of the Bill, as passed by Dáil Éireann. The Deputy is reading an older version.
(Carlow-Kilkenny): My apologies; I knew I was slightly out of touch.
The bank is merely obliged to make a disclosure of something unusual. It is the responsibility of the Garda to investigate it. If the person subject to the inquiry has a good answer that is the end of the matter.
I move that the Committee agree with the Seanad in amendment No. 34:
In page 43, between lines 13 and 14, the following new subsection inserted:
"(4) In determining whether a person has complied with any of the requirements of this section, a court may take account of any relevant supervisory or regulatory guidance which applies to that person or any other relevant guidance issued by a body that regulates, or is representative of, any trade, profession, business or employment carried on by that person.".
This amendment proposed that in determining whether a person has complied with the obligations to report suspicious money laundering transactions — perhaps that is incorrect phraseology and I should simply say suspicious transactions — to the Garda under section 44, a court may have regard to any professional rules or guidelines which apply to the person in the conduct of his or her business.
The amendment is designed to ensure that persons covered by section 44 are not obliged to take unreasonable measures to avoid prosecution under the section. Where a person takes steps to detect and report laundering, which are in line with the best practice in his business or profession, that factor should be taken into account by a court in deciding whether a person has met his obligations under section 44.
In this context, even in advance of this Bill becoming law, a steering group — with representatives of the Minister for Finance, the Department of Justice, the Central Bank and of the institutions most likely to be affected by the reporting arrangements in relation to money laundering specified in the Bill — has been established to begin the process of drawing up guidelines for the various sectors involved. It would be appropriate to give statutory recognition in the Bill to the existence of such guidelines and I hope the steering committee will put the matter beyond any doubt.
When we were debating this section on Committee Stage we referred to the equivalent legislation in the United Kingdom. Because we are one of the last countries to comply with the directive on money laundering, we have the benefit of the experience of how legislation was implemented and enforced in other jurisdictions. The proof of this legislation will be in its implementation and enforcement and, undoubtedly, there will be procedural problems. We have just discussed changing procedural cultures in banking and financial institutions.
I am glad the Minister confirmed there will be a steering committee, which is essential. A similar committee was established in the UK to pull together the various strands necessary to make this complex legislation work, because the Bill has many implications. When our sterring committee meets and discusses the implications of the Bill, it will find it will need the flexibility to exist for a number of years. The legislation should be constantly under review, based on how successful the authorities and financial institutions find the enforcement of the legislation. I welcome the steering committee and the Minister's conformation of its existence.
I move that the Committee agree with the Seanad in amendment No. 35:
In page 44, subsection (1), line 14, "of the first mentioned offence" deleted.
This is simply a drafting amendment. The draftsman has indicated that the words "of the first mentioned offence", which appear at the end of section 46 (1), should be deleted. This does not have any substantive effect; the words were put in by mistake. The terminology is tautologous, to say the least. The subsection is better drafted if the phrase is removed.
In the interest of eliminating tautology I agree to the amendment.
(Carlow-Kilkenny): This is the first time I heard a Minister admitting a mistake.
Amendment No. 36 is consequential on amendment No. 37 and they can be taken together. Is that agreed? Agreed.
FIRST SCHEDULE.
I move that the Committee agree with the Seanad in amendment No. 36:
In page 51, paragraph 1 (1) (1), line 25, "and" deleted.
The kernel of the proposal in these amendments is in amendment No. 37 but procedural requirements mean I must first move amendment No. 36, which is merely a technical amendment consequential on the other amendment.
In the course of our discussions here and in the extensive debate on the Bill in the other House, there was a reference to the valuable and significant part the Naval Service played in helping to combat drug trafficking. We are all aware of its success in that area and all sides of the House hope it will be maintained.
The purpose of amendment No. 37 is to strengthen and clarify the position of the Naval Service in preventing illegal drugs reaching this country. In that regard I propose to amend the First Schedule to ensure the powers of an enforcement officer under section 31 of the Bill in relation to measures against drugs imported on ships will be specifically conferred on members of the Naval Service not below the rank of petty officer.
Deputies will be aware that section 31, in conjunction with the First Schedule, enables an enforcement officer to stop and board a ship and to search and detain it in connection with drug trafficking. At present the definition of "enforcement officer" in the Bill applies to members of the Garda Síochána, customs officers and other persons specified by ministerial order.
In the context of the report being completed by an official of my Department, which deals specifically with inter-agency co-operation in this area, the definition should be extended to include appropriate members of the Naval Service. This should be done in the Bill rather than in subsequent regulations so that clear recognition can be given to the vital role of that service in the fight against drug trafficking. Accordingly, I would be grateful if the amendment could be considered favourably by the House.
(Carlow-Kilkenny): I welcome this amendment because the Naval Service will become increasingly involved in the control of drugs. Last summer drugs were dumped off our coast at sea bed level. The navy will have to be involved and anything which strengthens its role is to be welcomed.
I too welcome the amendment. It gives the Minister an opportunity to acknowledge the important role played by the Naval Service — it plays an equal part with Customs and Excise in detecting and potentially seizing drugs. This is especially relevant because of our status and location as an island state. Because of the many little inlets around our coast, especially in the west, it is easy to land drugs. This is shown in the various seizures in the area.
It is necessary that enforcement officers have the requisite powers to act and to board ships. In the long term, because of our membership of the EU, the Irish Naval Service will play an increasingly important role in the monitoring and detection of drugs. That role should be developed so the navy can play a full part in the detection of drugs coming into Europe via Ireland.
This Bill now goes to the President for signature. It will be a substantial improvement and will strengthen our criminal law to deal with drug trafficking and money laundering. I thank Deputies on all sides for their contributions to the debate. The difference between the Bill as initiated and the Bill as finally passed shows the Government and the Civil Service, as good as they may be, do not have a monopoly of wisdom. The contributions made on all sides are reflected in the final shape of the Bill. The Bill has been improved as a result of the welcome contributions by Opposition spokespersons; I acknowledge that and I thank them on behalf of the people whom it will help in relation to putting some of the most unsavoury characters behind bars. On behalf of the people and the Government I thank the Opposition for their contribution to strengthening and improving the Bill.
I move that the Committee agree with the Seanad in amendment No. 37:
In page 51, paragraph 1 (1), between lines 25 and 26, the following inserted:
"(c) a member of the Naval Service of the Defence Forces not below the rank of petty officer, and".
A message will be sent to Seanad Éireann acquainting it accordingly.
(Carlow-Kilkenny): I thank the Minister for being so co-operative in listening to all the views expressed here and his kind remarks about the contribution by the Opposition.
I too thank the Minister for his remarks. I enjoyed debating the Bill at all Stages. It is draconian and for that reason it was debated and scrutinised carefully. While there is an appetite for draconian legislation in the whole area of drug trafficking and white collar crime there was a need to get it right. The success of this legislation will depend on how it is enforced. That is why it was important to scrutinise, at all stages, the technical and practical aspects of the Bill. I congratulate the Minister and the Minister of State for responding to Opposition amendments. I hope this legislation will go a long way to tipping the balance in favour of the State in confronting the notion that crime paid in the past.
