Oireachtas Joint and Select Committees

Wednesday, 3 November 2021

Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach

General Scheme of the Central Bank (Individual Accountability Framework) Bill 2021: Central Bank

Ms Seána Cunningham:

I thank the Senator. I will start with the criminal sanction aspect. This proposal is around a civil or regulatory framework being enhanced. The Senator asked a specific question about how it works more broadly. Pursuant to the legislation, the Central Bank has obligations where we form a suspicion of a criminal offence to make reports to An Garda Síochána and, in some cases, other agencies. There are occasions where we make reports like that and where the Garda takes ownership of the matter and there is a criminal investigation. There are other cases where the Central Bank deals with the matter under an administrative or regulatory process.

It is interesting to look at the UK and Australia, where similar regimes were introduced, and they were also civil rather than criminal in nature. We are very clear in our view that there are areas where criminal sanctions are appropriate and others where civil or regulatory remedies are very important and have an enormous deterrence value.

The Senator made a point about the public statement aspect and what is there is essentially a codification of an "as is" position. We have been very clear on, and conscious of, how we see enforcement so that there is transparency and it is of a public nature. Looking at regulatory authorities in other jurisdictions, they do not bring the level of transparency that the Central Bank brings in enforcement. There may be a kind of one-line statement such as "Firm A sanctioned €30,000" but we have an entirely different approach that we propose to continue under this enhanced framework. This would see the Central Bank publishing the name of a firm or individual, along with details of sanctions imposed so the market is clearly aware of them.

For example, this year we published an enforcement statement relating to an individual concerned with the management of Irish Nationwide Building Society. The individual is set out therein and it is set out that he is disqualified for 15 years and that he has been sanctioned €200,000. What he did exactly is also set out. We have an approach of transparency under settlement. That will not change and it will continue.

There may be specific concerns about an appropriate consequence and sometimes this is more about trying to bring somebody into compliance rather than punishing people. That is something we think about when considering the most effective tool to bring about compliance in certain cases. For example, in an inquiry context we want co-operation and participation of individuals before that inquiry.

I mentioned earlier that it is important that both regulatory and criminal regimes operate effectively and in a way that is informed by each other so the system deals with matters in the right and appropriate way. Much of this is down to how different agencies interact and co-operate with each other. We will continue to have excellent engagement and co-operation, particularly with colleagues in An Garda Síochána, in appropriate cases.