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Dáil Éireann díospóireacht -
Wednesday, 12 May 1999

Vol. 504 No. 5

Written Answers. - Company Investigations.

Ruairí Quinn

Ceist:

66 Mr. Quinn asked the Tánaiste and Minister for Enterprise, Trade and Employment if her attention has been drawn to the concerns regarding a company (details supplied) in Dublin 2 having regard to the fact that the managing director is reported to have been declared bankrupt in the United States; if she will carry out an investigation into the affairs of this company; and if she will make a statement on the matter. [12236/99]

The Wise Finance Company Limited was incorporated in the UK and registered as a branch in this state on 10 November 1995 under the European Communities (Branch Disclosures) Regulations, 1993. Its directors are Ronald Weisz and Fiona Weisz.

An allegation that Ronald Weisz was declared a bankrupt in New York State in 1994 was made to my Department. Section 183 of the Companies Act, 1963, as amended, prohibits an undischarged bankrupt from acting as a director of a company. As the bankruptcy was allegedly declared in a foreign state, legal advice was sought on the issue of jurisdiction.

I have since been advised that a person declared a bankrupt in the US and remaining undischarged would not be in breach of section 183 by acting as a director in this jurisdiction. Such circumstances are clearly unsatisfactory and will be addressed in the preparation of future companies legislation, and my Department will give the matter its attention in the interim period.

Part II of the Companies Act, 1990 sets out the limited circumstances in which an investigation of the affairs of a company may take place. Section 8 provides for the appointment by the High Court of an inspector on the application of the Minister where the court is satisfied that there are circumstances suggesting,inter alia, fraud or unlawful activity. Under section 19, the Minister may appoint an authorised officer to investigate a company where she is satisfied that similar circumstances exist. Before contemplating an inquiry using public funds, a wide range of issues need to be taken into account, not least of which is the evidential quality of the allegations. The information available to my Department at the present time does not suggest that the present circumstances meet the requirements for an investigation as laid down in either sections 8 or 19 of the 1990 Act.
I am conscious that as the law currently stands, it is possible for individuals or companies to act as mortgage lenders without a licence or authorisation from any authority and without any restrictions as to the interest rates they may charge. Both I and the Director of Consumer Affairs are concerned about this situation and my Department has recently begun a review of the Consumer Credit Act, 1995, with a view to identifying any gaps in the protection afforded to consumers, including the issue of unregulated mortgage lending.
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