Dáil Éireann Debate, Thursday - 22 June 2023
82. Deputy Pearse Doherty asked the Minister for Finance the input he and his Department have had in the establishment of a multi-annual strategy to combat economic crime and corruption, including fraud and scams; and if he will make a statement on the matter. [30242/23]
Amharc ar fhreagraIn recent years, there has been a dramatic and worrying increase in the incidence of financial fraud and scams. Everyone has seen that. Citizens are increasingly concerned that the text messages and calls they receive are scams and that the adverts they see online are not genuine, but fraudulent. Despite this, the Government still does not have a multi-annual strategy to combat financial fraud and scams even though it was a key recommendation of the Hamilton report in December 2020. What action has the Department taken and will take to stem the rise of fraud? Why is the Government not introducing a plan that was asked for nearly three years ago?
Although primary responsibility for combating all forms of crime and corruption lies with the Minister for Justice, my Department is eager to contribute to this task insofar as we can. An advisory council on economic crime and corruption was established in May 2022. Its establishment was one of the recommendations made in the review of structures and strategies to prevent, investigate and penalise economic crime and corruption. The review, colloquially known as the Hamilton review, was led by Mr. James Hamilton, the former Director of Public Prosecutions. Mr. Hamilton also chairs the advisory council.
The council is comprised of public sector officials as well as members with appropriate expertise from the private sector. It will advise and make proposals on strategic and policy responses and will be responsible for developing a multi-annual strategy to combat economic crime and corruption. An official from my Department has been appointed to the council, as has an official from the Central Bank of Ireland.
Ireland has a strong legislative framework to deal with economic crime. An Garda Síochána utilises the organised crime legislation, where appropriate, because organised criminal groups are behind almost all economic crime. Many of such groups are transnational in nature. An Garda Síochána is engaging with the Department of Justice and the Hamilton implementation group to strengthen some legislative areas to increase the efficacy of criminal investigations in this area.
A specialised division of An Garda Síochána - the Garda national economic crime bureau, GNECB - tackles this sort of criminal behaviour. The GNECB is responsible for the investigation of the most serious and complex economic crimes. It plays a proactive role in the prevention, disruption, detection and investigation of economic crime. It also provides support and assistance to regional and divisional Garda investigators and provides training in the form of a University College Dublin, UCD, accredited postgraduate certificate in fraud and e-crime investigation, and a specialised course in money laundering investigation. The head of this division is a member of the advisory council on economic crime and corruption.
Figures released to me by the Department of Justice show that since 2019 investment fraud has risen by 258%, account takeover fraud has increased by a staggering 560%, romance fraud has risen by 83% while scams through phishing, vishing and smishing have increased by 417%. These are frightening figures. Citizens are being robbed of millions of euro each year by fraudsters.
Last week ComReg estimated that scam calls and texts cost society and the economy more than €300 million each year. I welcome its proposals in that regard, but what is the Government doing? Why has it not published a multi-annual strategy to combat fraud and scams when this was recommended by the Hamilton report two and a half years ago? That is a very simple question to which we still do not have an answer. Why is the Government blocking the establishment of a shared information fraud database so that banks and agencies can act to stop fraudsters in their tracks in real time? It does not make any sense.
The Minister spoke about a strong legislative basis but gardaí and the banks are looking for this shared fraud database and the Government and the Department are blocking it. It makes no sense, given the rise in fraud and the hundreds of millions of euro that are being stolen each year. This is a battle that we are losing but unfortunately, we are fighting this battle with two hands tied behind our back.
The rise in this form of crime is a serious concern but I assure Deputy Doherty and the House that the advisory council is active. It met on 30 May last and it is working towards the development of a multi-annual strategy to combat economic crime and corruption. My officials in the Department of Finance are working closely with our colleagues in the Department of Justice to ensure that the council's work is brought to a conclusion and that the multi-annual plan can be brought forward as quickly as possible.
A lot of work is already happening. I referenced the Garda bureau earlier. It has trained 680 gardaí and 200 investigators on each of the respective courses that have been put in place and these members are available in each of the Garda divisions throughout the country. We have a strong legislative framework. We are resourcing the relevant Garda bureau to make sure that adequate training is in place and that officers are available around the country to deal with the rise in this form of crime. We are working very closely with the other stakeholders whose support and input we need, including the financial services industry, the members of the Banking and Payments Federation of Ireland, BPFI, and others, to deal with this form of crime.
The Minister has no strategy two and a half years on - that is a fact. The Government is blocking the implementation of a shared information fraud database which would allow for information to be shared in real time. It is clear that the Government is not taking the issue of this growing crime seriously. Interventions could be made to protect citizens from the criminal activities of fraudsters but the Government is simply not at the races. For example, I raised the fact previously that in the North, banks and payment providers will soon be required to compensate victims of authorised push payments but there is no such protection here in the South. When I asked the Minister if it would be possible to introduce this protection in this jurisdiction he informed me that it was prohibited under the EU payment services directive. However the European Commissioner for Financial Stability, Financial Services and the Capital Markets Union, Ms Mairéad McGuinness, informed my colleague, Mr. Chris MacManus MEP, that there was nothing stopping member states from introducing such protections. We also have no requirement for banks to check the name of the entity to which customers are sending money against the name on the registered account. That safety check, called confirmation of payee, is in place and working well in the Netherlands and Britain.
As I said, this Government is blocking a shared information database and has no strategy two and a half years on. The BPFI has warned that if we fall behind in this fight, Ireland will become the destination of choice for fraudsters. We are falling behind. There has been an explosion in this type of fraudulent activity. The Minister spoke about the GNECB. I got a call from the GNECB yesterday but it was not actually from the bureau. It was a scammer who claimed to represent the GNECB and who told me to press number 1 in relation to my account. This is happening all of the time. There has been an explosion in this type of activity and it makes no sense that the Government has no strategy, is blocking the shared information database, has not implemented confirmation of payee and that there is no process in place whereby victims would be compensated as they will be in Newry, Derry, Belfast and elsewhere.
We are actively working on this issue. The advisory council, which came from the Hamilton report, is up and running. It has representatives from all of the key areas that would one expect across the Government and the private sector who are working to develop a comprehensive strategy to deal with what is a very significant issue of public concern. We are all seeing the increase in the activity levels here and the attempts at crime and fraud in this space. That said, the provisional crime statistics for 2022 released by An Garda Síochána in March show that technology-based fraud such as phishing, account takeover and online shopping fraud went down in that year, following a significant increase in such activity during the Covid-19 pandemic.
We are absolutely committed to doing all we can, working with others in the private sector, to tackle this issue. The advisory council is developing a multi-annual strategy which the Government will then fully implement.
