Vol. 456 No. 3
5 Mr. O'Donoghue asked the Minister for Justice the plans, if any, she has to introduce measures with a view to combating white collar fraud; her proposals regarding this problem; and if she will make a statement on the matter. [13750/95]
I have already taken a number of significant steps to strengthen the hands of the gardaí in tackling so-called white collar fraud. The use of the term "white collar crime" somehow implies that this type of crime is respectable compared to other offences — I prefer to call it, what it is, serious fraud which covers such offences as forgery, embezzlement, obtaining credit by fraud, falsification of accounts and the common law offence of conspiracy to defraud.
Deputies will be aware that there are a number of statutes which were enacted in recent years containing provisions which are particularly relevant to the fight against serious fraud. For example, the Criminal Damage Act, 1991, made computer hacking a criminal offence and the Criminal Evidence Act, 1992, allowed computer evidence to be admitted in evidence in criminal proceedings. In addition, the Criminal Justice Act, 1994, provides for the confiscation of criminal proceeds and enables the Garda Síochána, on foot of orders made by the District Court, to obtain access to information from banks etc., for the purpose of carrying out investigations into money laundering and other serious offences. I also made a commencement order earlier this year bringing section 32 of the Criminal Justice Act into operation which requires financial bodies to take certain steps to assist in the detection and prevention of money laundering. This section obliges a bank or building society, for example, to identify any person for whom it proposes to provide an ongoing service, such as opening an account or for whom it undertakes a transaction involving a sum in excess of £10,000. In addition, identification must be carried out in any case where money laundering is suspected. Section 57 of the Act provides that a financial institution must make a report to the Garda Síochána where it suspects that money laundering is taking place in relation to its business.
I am at present preparing legislation on fraud and offences of dishonesty in general. The work is well advanced and I intend to bring my proposals to Government later this year. The legislation, which will be based on recommendations of the Advisory Committee on Fraud and the Law Reform Commission, will involve consolidating over half a dozen statutes dealing with dishonesty and strengthening the law in a way which fully reflects the realities of modern day fraud.
In April this year I established the National Bureau of Fraud Investigation in line with the recommendations contained in the report of the Government Advisory Committee on Fraud. A chief superintendent was appointed straight away as head of the new bureau and he has been involved in the selection of suitable staff to increase the strength of the bureau to the level recommended by the advisory committee. One inspector and three sergeants were assigned to the bureau on 14 September, 1995 and an additional inspector will be assigned there later this week. Fourteen additional gardaí will also be assigned to the bureau on 5 October 1995. Arrangements are also well advanced for the employment of full-time professional accountants for the bureau and these posts will be advertised shortly through the Civil Service Commission. I have also made provision in this year's Estimates for the purchase of specialised fraud-related information technology equipment for the bureau and the requirements in this regard are being assessed at present.
It is essential that we are serious in our endeavours to tackle fraud which has become far more sophisticated in modern times. I have provided the additional manpower and resources to the Garda Síochána and I am determined to have the available legislation used to the full and the new legislation on fraud and offences of dishonesty published and enacted as quickly as I can to strengthen the powers of the gardaí and the courts.
As a recent fraud awareness survey carried out by Stokes Kennedy and Crowley established that 39 per cent of top Irish companies admitted to having experienced fraud in the past two years and that at the very least £9.4 million was taken through such fraudulent means, does the Minister accept that the information technology in the fraud bureau needs to be up-dated and that people with information technology skills need to be employed there as a matter of urgency?
I certainly do and that is why, on taking up office, I proceeded as quickly as possible to set up the National Bureau of Fraud Investigation. As the establishment of such a bureau had been in the pipeline for some time before I took office, I was happy to be able to institute it immediately. Resources are now available for new fraud related information technology to be purchased and put into use by the bureau. Members may be interested to know the level of cases going through the courts at any one time, covering such matters as false pretences, forgery, fraudulent conversion, embezzlement, obtaining credit by fraud, falsification of accounts and the common law offence of conspiracy to defraud. There is nothing on our Statute Book called "white collar crime"; those are the crimes that are generally referred to in that manner.
There were 438 commercial fraud cases reported in 1994 and 301 to date this year; there were 1,181 cheque-credit card fraud cases reported in 1994 and 605 to date this year. A total of 187 people have been charged by the National Bureau of Fraud Investigation — the Fraud Squad — during 1994-95. There is a high level of this type of crime but in order to prosecute evidence has to be presented in court.
I thank the Minister for that information. In the light of the statement made recently by her colleague, the Minister for Transport, Energy and Comunications, Deputy Lowry, to the effect that it would be naive to conclude that State companies are removed from the risk of fraud and white collar crime, has the Minister been made aware of any allegations of white collar crime in semi-State companies? Is any investigation proceeding and does she believe the Minister for Transport, Energy and Communications is correct?
Any allegations of fraud should be made directly to the Garda Síochána whose responsibility it is to investigate wrongdoing. That is what is happening at the moment.
Am I correct in saying that the Minister has no knowledge whatsoever of any allegations of white collar crime in semi-State companies?
I suspect that what the Deputy is trying to do is to raise other issues——
Not at all.
——including the introduction of measures to combat white collar crime. If one is aware of any cases involving fraud in State or private companies or elsewhere, they should bring the matter to the attention of the Garda Síochána. I am not the investigating authority; it is the Garda Síochána which investigates allegations of fraud.
Before calling Deputy Byrne I should mention that this matter is the subject of Question No. 22 on the Order Paper.
Does the Minister agree that each year the Comptroller and Auditor General produces a document which shows, in relation to income tax, PRSI and corporation tax payments, that fraud is widespread and perpetrated by otherwise respectable businessmen? Can she see the day when a case similar to the Lester Piggott case in England will be brought here and when, rather than publishing a list of fraudsters in the newspapers, they will be listed as having been sent to jail for fraud and transferring PRSI and income tax payments out of the State for their personal gain?
Any cases involving fraud should be and are taken seriously by the Garda Síochána irrespective of who is involved; it is not a case of only one section of the community being targeted in the fight against fraud. I am not considering any proposals at present; it would be a matter for the Minister for Finance to decide what lists should be published in any newspaper relating to the non-payment of taxes. I presume the Deputy is referring to the lists of those who owe back taxes and which everyone peruses when published. If someone is convicted in court of fraud, it will be reported in the newspapers. Just because they might be well off does not mean they will be allowed hide their name from the court.
Does it not disturb the Minister that there is no record of any of these so-called respectable businessmen who are guilty of fraud ending up in Mountjoy Prison?
I do not know how the Deputy would describe those who are known as respectable businessmen but there are people in our prisons who would fit that description. It is not the case that our prisons contain only people who come from a particular background. There are one or two high profile individuals in prison having been convicted of fraud or similar offences.
The Minister has given the figures for the number of fraud cases reported. Does she agree that there is a need for excellence in terms of professional expertise in the National Bureau of Fraud Investigation to overcome the difficult and sophisticated accounting problems experienced in any investigation of fraud activity? The Minister mentioned that 14 additional gardaí will be appointed in October. Were these posts advertised internally or will they be open to those with particular qualifications, such as accountancy or other professional qualifications, which are essential in the investigation of fraud cases? Was there an enthusiastic response to the advertisement of these posts from within the Garda Síochána and, if not, what does the Minister propose to do? Will the posts be advertised publicly in order to recruit those with professional expertise?
Arrangements are well advanced for the employment of full time professional accountants as recommended by the advisory committee on fraud. This matter is the subject of another question tabled by one of the Deputy's colleagues. In general, whereas the posts of garda in the new bureau will not be advertised publicly the posts of accountant will.
Those who work in the Fraud Squad have built up expertise. I am satisfied that the people who will head up the bureau and will be selected to work within it will be adequately qualified. As Members know from their constituency work, those joining the Garda Síochána are now extremely well qualified, often with degrees in economics, while many members of the force use their time wisely to further their education. We will be able to trawl the best from these.
Was the Minister or her Department advised by the Garda authorities of any allegations of white collar crime in the semi-State sector or asked to introduce measures to combat fraud within that sector? Does she accept that both she and the Government would be most surprised if the Garda Síochána did not pass on information relating to any such allegations in view of the fact that the State is the shareholder?
In any investigation the Garda Síochána does not pass on information to me. If I request a report or if and when it decides that a report should be submitted to me, it will be provided up to a certain point in the investigation. The matter to which the Deputy may be alluding will, as he is aware, be dealt with extensively next week in the Dáil by the Minister concerned.
The Minister has not answered a straight question which is directly related to Question No. 5 on the Order Paper. If I put down a question or ask a supplementary question directly related to it I am entitled to a straight answer as a matter of course. I again ask the Minister to give a straight answer to the question I posed, which was simple, lucid and clear. I asked if the Minister for Justice was advised at any stage by the Garda authorities that there was an allegation of white collar fraud in semi-State companies and if she would be surprised if she were not so informed since the State is the shareholder. That is a straight and simple question and the Minister has an obligation to the House to answer it.
We must move on.
I will cite the Minister for Transport, Energy and Communications, Deputy Lowry.
The Deputy has made his point.
He implied that by innuendo.
I have not been advised by the Garda as of now that they are investigating any allegation of white collar crime.
Why did the Minister not say that earlier?
Listen to the answer. At any time the Garda may be investigating numerous cases about which I do not know anything. That is the nature of their work. I am not investigating any allegations because I am not the investigating authority.
Question No. 7 in the name of Deputy Briscoe.
On a point of order, I insist on the latter part of the question being answered. It is quite simple.
I answered the Deputy's question.
Would the Minister be surprised or not surprised that neither she, as Minister for Justice, nor the Government would be advised of allegations of white collar fraud in the semi-State sector in view of the fact that the State is the principal shareholder? Yes or no?
The Chair has no function in the way Ministers answer questions.
I do not know why Deputy O'Donoghue has such difficulty understanding it. At any time, the Garda investigate numerous crimes of all kinds. There could be allegations made against us or semi-State bodies. They do not come to me on a daily basis and tell me what work they are doing.
I did not say they did.
I would be neither surprised nor not surprised if the Garda do or do not give me information on a day to day basis. They will give me information when they think I need to know it and if I ask for it.
I am calling Question No. 7.
The Minister cannot be serious. This is akin to telling a private company that it would not be told if there were allegations made about——
Classical evasion.
