Mattie McGrath (Tipperary, Independent) | Oireachtas source

I have known Deputy Broughan for a long time and I would never try to stifle him in a debate on serious issues. We did not set out to upset anyone but only to represent our constituents.

I welcome the opportunity to speak on this Bill. I do not see many here to speak on it and do not know what difference it would have made if we had debated it last night. This Bill is complex, like so many that have come our way from Europe, but it is not all bad. I refer in particular to the repeal and replacement of the criminal sanctions in section 3 that proposes to repeal section 5 of the Markets in Financial Instruments and Miscellaneous Provisions Act 2007, which sets out the penalties for conviction on indictment of Irish investment services in law. This is very timely and ours is one of the last governments to comply with this.

We saw the results of all that went on when the markets went crazy. The EU has to take some of the blame for that. The ECB and European banks continued to trade recklessly in respect of investments in our economy and then they fled, offering us a bailout which at the time I called a clean out. Interest was at almost 6% whereas the International Monetary Fund, IMF, gave it to us for less than 3%. Our true friends were scarce when we put out our hand for support.

This should have been a costly lesson. We must play our part and close any loophole which enables high flyers and investors to benefit from financial schemes. As stated by Deputy Thomas P. Broughan and others, transactions of massive scale can be made within minutes or hours such that it is very hard to have transparency and traceability. Many of the transactions can have sweeping effects on economies, businesses and ordinary people.

As the explanatory memorandum makes clear, section 5 of the Bill proposes the reintroduction of the same criminal sanctions, but they will now apply to relevant offences under the revised MiFID II rules. It is important to expand on this section. Section 5 of the 2007 Act provides that a person found guilty of an offence under subsection (2) is liable on conviction or indictment to a fine not exceeding €10 million or imprisonment for a term not exceeding ten years, or both. These are hefty penalties, but investigation of compliance can often be a meandering pathway. Perhaps the Minister of State, Deputy Michael D'Arcy, might tell us if there are jurisdictions in which there have been investigations, trials and successful prosecutions. The penalties set out in section 5 of the 2007 Act are without prejudice to penalties provided for in Irish investment services law. It is important there not be situations where this measure will interfere with penalties applicable on summary conviction for an offence or the ability to bring summary proceedings for any offence under Irish investment services law. I hope there will not be a conflation of the two and that people will not escape the full rigour of the law by virtue of there being two schemes.

All of this is confusing for the lay person, including me, who is not versed in the detailed terminology of financial law which is very challenging to understand, unless someone is a legal or financial expert. However, it is crystal clear that we need to ensure there will be robust sanctions in place for irregular and criminal actions within the European financial sector. Deputy Thomas P. Broughan failed to mention that during our discussions last night on the Criminal Justice (Corruption Offences) Bill 2017 which passed all Stages we discussed the issue of traceability and our ability to track down the financial geniuses who earned their wealth by way of crime. They have all the time in the world to prey on their victims and plan schemes to enable them to make lucrative investments abroad in wonderful places, using hotels and fancy gym facilities as fronts for their investments. Many of them are involved in ponzi schemes. We, therefore, need to ensure Interpol and other European agencies are active in this area. We also need to put our shoulders to the wheel in that regard. The Bill is relevant in that context at this time.

Section 8 deals with the credit register, while section 9 provides that life insurance products will also be included, which is timely as many of us have been victims of small-scale schemes. Some of the bigger schemes needed to be regulated properly and brought in under the MiFID II rules. This is important in the context of corporate governance. We can have all of the corporate governance rules we want, but we need to enforce them and ensure we also adhere to the spirit of the law. We have seen incidents of reckless trading, in respect of which there has been little or no corporate governance. The governance arrangements that were in place were scant and there was little respect for them. There is always corporate governance when it comes to the small man and PAYE employees and so on, but when it comes to white collar crime and senior cavalier traders and big business, there is little success in holding them to account, as we have seen in the courts system. They play games of cat and mouse with State institutions, including the Garda Fraud Squad, the Criminal Assets Bureau and the prosecution service, and also hire the brightest and most expensive lawyers. We cannot allow this to continue. There must be some sense of parity and respect across the board for the rule of law. The Minister of State and I know, as does everybody else, that the con artists who participate in these ponzi schemes are way ahead of us. We are playing catch-up all of the time in legislation and in instances where we were successful, the penalties did not fit the crime. I am delighted that there are strong penalties provided for in the Bill, but they will be of no use on the Statue Book if they are not implemented. While we must always respect people's rights in that they are innocent until proved guilty, we need to be rigorous, vigorous and upfront in monitoring and ensuring oversight. Many of the watchdogs are not effective. We have too many agencies and there is too much criss-crossing.

I am happy to support Deputy Michael McGrath's proposed Bill on data protection. Elected representatives will be made redundant. We will be able to speak about issues in the House, but we will not be able to make representations on behalf of our constituents. The purpose of what is being proposed is to silence people and lock out the public in terms of their rights when it comes to banks and insurance and ponzi schemes.

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