Oireachtas Joint and Select Committees

Wednesday, 3 December 2014

Joint Oireachtas Committee on Transport and Communications

Fuel Fraud: Revenue Commissioners

11:20 am

Photo of Michelle MulherinMichelle Mulherin (Mayo, Fine Gael) | Oireachtas source

I welcome the officials from the Revenue Commissioners. This issue is plaguing my constituency, Mayo. By virtue of that I am aware of other cases around the country. Most citizens think of the Revenue Commissioners as a State organisation that knows how to get a job done, is effective, does an excellent job but their investigation of contaminated petrol has been a disaster.

Investigations and complaints have been received since last June. The forecourt filling stations give monthly returns of oil movements showing where they get petrol and so on. We can assume that the Revenue Commissioners have tracked down the chain of supply. Mr. Moran has told us that the State Laboratory carries out 100 tests a month but that for the most part this is inconclusive. Hundreds of people’s vehicles have been damaged or written off and some cannot afford to have them fixed. The vigorous and proactive approach taken to dealing with diesel laundering needs to be taken in this case. There is evidence that it was not.

I know from replies to parliamentary questions that I have tabled since the end of September, the Garda was investigating 86 cases of petrol stretching in County Mayo but the Revenue Commissioners were dealing with eleven or 12. That clearly indicated that they were not working together but I believe that they are now. Is the State Laboratory not predominantly looking for markers in fuel and is it unable to identify some contaminants if they exist? A feature of petrol stretching is that carbon is left on the pistons which causes the car to break down and is evidence that there was something wrong with the fuel but the Revenue Commissioners cannot attribute the source of the carbon. No test has been developed to identify it. Mr. Moran has said that as an official of the Revenue Commissioners consumer rights are not his area. Consumers would like to hear after this meeting that a test case would be taken and there might be a breakthrough. Would Mr. Moran comment on the serious problem in the chain of evidence? There are time-lags as he has said in finding the contaminated fuel. The individual has to show that he or she bought it and when, and prove that it was the problem fuel not a later fill. When these cases come to court they will not have any success, apart from a small minority.

The Revenue Commissioners’ system is wrong. They talk about a risk-based approach and has tackled guys involved in diesel laundering. They might look to the area that is not so well scrutinised. They will not have any success because what they are doing is historic. They deal with it only after the problem has happened. There is a big gap between the problem and the evidence when the cars break down. They will go nowhere. The truth needs to be told, if people’s expectations are raised about this.

There are suggestions that insurance companies ought to do this that and the other. Insurance companies are bound by contracts. If they are not obliged to cover this they will not do so. I am not saying there are not exceptional cases but there are some exclusion clauses in insurance contracts for petrol stretching. The people who have gone through enough do not want to hear any sort of vagueness. I have tabled numerous parliamentary questions on this and that is why I am delighted to be able to speak to Mr. Moran.

Deputy Fitzmaurice spoke about contaminated petrol that was supposed to go to Bournemouth but was withdrawn from the UK market and sent over here. We are wide open here because the Revenue Commissioners’ system does not test tankers or filling stations before now.

Mr. Moran cannot and did not confirm that any petrol tanks in filling stations or any fuel tanks of trucks were tested prior to June of this year. What he said in that respect was that he did not know. I understand that it was not done and I have formed that view from talking to people in business and those in petrol forecourts. A proactive approach is not being taken to tackle this problem but such an approach is needed. In terms of what is alleged to have happened in regard to Bournemouth, we are not testing fuel that is coming into this country. I imagine the people engaged in this activity will not be operating under the nose of Revenue. There is less likely to be a mixing of fuel and the putting in place of bad fuel. However, such fuel will be brought in but Revenue is not testing fuel here. Anybody with a batch of bad fuel they want to get rid of could move it to Ireland.

What we need, and I ask that this be explored, is for consideration to be given to the introduction of a system of quality control to be funded by the distributors. Those are the people making money out of it. There should also be a mobile laboratory. Mr. Moran mentioned there was a case in the east coast where it was suspected that kerosene has been blended with petrol which has caused a problem. Revenue had to go through the process of taking a sample, sending it to a laboratory and how many weeks elapsed before it got a certificate of analysis? I ask Mr. Moran and Mr. Butler how many vehicles will have been destroyed in the meantime? That is too long to wait. Those people's operations should be shut down. I ask the delegates that a quality control system be introduced where petrol is tested to ensure that we know that quality petrol is for sale on the market. There is a crisis of consumer confidence in this market. I do not believe that Revenue will have any problem in getting co-operation from legitimate forecourt traders. I ask that such a system be implemented in order that consumers purchasing petrol and paying tax on it know that what they are getting is the real McCoy.

On the cross-Border element, Mr. Moran spoke about shutting down 130 filling stations and mentioned a prosecution. Has the Criminal Assets Bureau been involved or what confiscations have taken place? Is such action being taken in the North? Are they viewing the problem with the same severity that it is being viewed with here? How many filling stations, fuel laundering and petrol stretching operations have been shut down? Is intimidation a factor there? All the evidence, and anecdotal evidence, is that subversive paramilitary style operations are in operation here. Is it a case that they are too much trouble to tackle? We can talk about the Border, but the petrol that has been stretched did not come from Mayo up to north of the Border. It is not happening in that way and I wonder how much of the contaminated fuel is going from the South to the North as opposed from the North to the South? What confiscations are taking place? What action is being taken by the Assets Recovery Agency in the North of Ireland?

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