Dáil debates

Thursday, 11 February 2021

Counterfeiting Bill 2020: Second Stage

 

11:10 am

Photo of Matt ShanahanMatt Shanahan (Waterford, Independent) | Oireachtas source

Counterfeiting refers to something capable of "passing for a currency, note or coin of that description, or if it is a currency, note or coin which has been so altered that it is [...] capable of passing for a note or coin of some other description". That is a long way around of saying a fraudulent copy. Ireland is the last country to transpose this 2014 directive on the protection of the euro and other currencies against counterfeiting.

The main planks of the directive call on member states to introduce criminal offences and sanctions concerning counterfeiting of the euro and other currencies. The directive also addresses territorial jurisdiction and calls for special investigation powers and measures. Transposing this directive into law will conjoin Ireland with protecting against counterfeiting to ensure continued confidence and trust in the euro currency. Without an integral value, supported and controlled by international law, nobody could have confidence in dealing in the euro, thereby threatening the financial stability of the EU.

Financial probity, integrity and resilience is the bedrock of a currency, and this can only be ensured by adequate, co-ordinated laws to protect against currency counterfeiting. The Bill is set to provide for a range of new powers and functions for the Central Bank of Ireland regarding monitoring and enforcement measures relating to suspect counterfeit euro currency, and in respect of currency not deemed suitable for recirculation. Included in this legislation is a designation of the currency centre of the Central Bank of Ireland as a national analysis centre for euro notes and coin, and the national analysis centre for coin for euro as well. The legislation provides for offences committed by a body corporate, or which are attributable to a person who is a director, manager, secretary or other officer of the body corporate, such that a person as well as the body corporate may be found guilty of an offence.

Counterfeiting has long been a lucrative trade and is often perceived as a victimless crime, unless, of course, one happens to be the person receiving the counterfeit moneys as payment. Since 2002, organised crime groups active in counterfeiting of the euro have caused financial damage worth at least €500 million. Without robust laws and oversight this figure will be far higher, causing not only debt but also having the potential to erode market sentiment in trading euro-denominated holdings. It is in the interests of the Union as a whole to oppose and pursue any activity likely to jeopardise the authenticity of the euro currency by counterfeiting.

The national analysis centre will examine suspect counterfeit bank notes and coins that are sent to the Central Bank.

It has a duty to examine, record and monitor suspect counterfeits as part of a strategic defence to counterfeit activity. The national analysis centre is also tasked with providing training on counterfeit detection to professional cash handlers, members of An Garda Síochána, customs officials and other bodies. The courts must also recognise the loss that can occur as a result of counterfeiting as well as the overall system vulnerability to large and wide-scale counterfeiting, which could have a macroeconomic effect for Ireland and for other member states. As such, significant criminal sentencing must apply to those who actively collaborate to support counterfeiting.

Euro banknotes have been undergoing a series of security improvements in recent years. The more recent Europa series provides for more sophisticated security measures aimed at ensuring the security of the currency. A range of print and security features is being rolled out to improve the identification of approved euro notes and confound possible copying. The ECB also provides training material to complement cash handlers training in the form of an e-learning course covering the characteristics, authenticity and fitness of banknotes. Despite these improvements, the eurozone reports for the second half of 2019 note that 308,000 counterfeit euro banknotes were withdrawn from circulation in the second half of 2019. This represents a 22% increase when compared with the first half of 2019, and a 17% increase on the second half of 2018. Of these counterfeit notes, 96% were found in other euro area countries. This demonstrates the need for vigilance, training systems and detection devices for businesses in Ireland which handle predominantly cash payments.

Ireland has come a long way in how we do business and deal with money transactions. Cash payments are becoming less commonplace as we appear to be moving towards an almost cashless society. Nonetheless, we need to know that our currency is solid and secure. The proposed changes called for by ratifying this directive will keep us in lockstep with our European partners in protecting our common currency and providing protection to our consumers. Given that we have prevaricated on this issue and that there is an undertanding now, most forcefully as a result of Covid, that Berlin is definitely closer than Boston, I propose that the House move appropriate legislation to meet the requirements of this directive and resulting legislation at the earliest opportunity.

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