Feargal Quinn (Independent)

I welcome the Minister to the House and thank him for introducing the Bill. I appreciate Senator Bradford's generous comments.

For many years, we have debated and called for legislation to protect whistleblowers. The new Bill will protect whistleblowers from dismissal or from being penalised in the workplace. The Minister is taking a much needed tough stance on white collar crime. Clearly, the need for this has been identified.

The Bill means it will be offence to not provide information to the Garda on complex white collar crime. I wonder whether this will be enough. Is it possible to provide another incentive to those who are sitting on the fence on whether to report, which must happen? In the United States, the Dodd-Frank Wall Street Reform and Consumer Protection Act requires the Securities and Exchange Commission to award in certain cases to qualifying whistleblowers no less than 10% and no greater than 30% of the total monetary sanctions collected because of the whistleblower's information. This is in cases where the government gets back more than $1 million dollars when there is a disclosure. The fundamental idea behind the whistleblower reward programme in the United States is to encourage people to come forward.

It is evident that many working in the financial sector were aware things were wrong before the crisis hit. Even in the months leading up to the collapse of Lehman Brothers, that institution's vice-president, Matthew Lee, tried to whistleblow on the firm's accounting methods. His contract was terminated some weeks later, in June 2008. In Ireland there have been many examples of bankers or those working in the financial sector whose careers were severely affected when they raised concerns about malpractice in the company. The simple fact is that sometimes these are the only people in a place to highlight such abuses and we need to do everything we can to protect them and to incentivise reporting.

I do not hold that we need a vast financial reward scheme as part of the whistleblower legislation, but it is a measure worth considering. Some form of reward may tip the balance for those who have doubts about whether they should report financial wrongdoing. Also, a reward would probably be a tiny percentage of the significant financial benefit of reporting certain wrongdoing in the financial sector. More people may come forward with their concerns if we have better protection for whistleblowers, but perhaps they should be rewarded more for doing what is often a remarkably risky act.

It is interesting to see the amount of work that goes into a regulatory impact analysis. This could have an extraordinary impact on the business community. How will auditors treat offences under section 197(3) of Companies Act 1990 when a director or an officer of the company fails to proved an auditor with relevant answers within two days of being requested to do so? An accountant and auditor could find themselves reporting to An Garda Síochána on a very regular basis, in particular with regard to section 202 on the keeping of books and records. I am concerned that very few directors take their duties and responsibilities seriously and we have seen many instances of this. I wonder whether An Garda Síochána has the resources to deal with all of the reports that will be required to be made under this new white-collar crime legislation. For this reason, we should consider an amendment to the Bill to improve protection for creditors generally. The Bill has slipped under the radar of the business community, accountants and other persons who may have to blow the whistle. I intend to table an amendment on Committee Stage.

When this legislation is enacted, a raft of persons such as bookkeepers, accountants, financial controllers, company employees, solicitors, barristers, estate agents, bankers, company secretaries and more than 500,000 company directors will have a duty to disclose a breach of any of the relevant offences listed in Schedule 1. Company directors do not know company law as they should and it has been broken for many years. Company law is approaching its 50th birthday and is a complete dog's dinner comprising 15 individual pieces of legislation which very few understand. Now, under section 19 of the Criminal Justice Bill 2011, at least 12 new sections of company law will be reportable to the Garda. Accountants, bookkeepers and auditors in particular will need to upskill immediately in this area as they will be sitting ducks for failure to comply with the professional standards of their own professional bodies, and will probably be those most at risk from prosecution under section 19 as they will have the most information. Those who work at the coal face in this area claim these laws are broken every day and nobody does anything about it, including the Office of the Director of Corporate Enforcement, ODCE. The office and the Garda fraud squad do not have the necessary resources to deal with corporate crime, notwithstanding that the Garda Commissioner and Mr. Paul Appleby have repeatedly stated that they have sufficient resources. The ODCE has 37 staff along with members of the Garda but they would probably need 370 or 3,700 people to deal with non-compliance with company law and, in particular, the whistleblowing provisions in the Companies Acts. If all the relevant persons blow the whistle, as they are required to do pursuant to section 19, then the ODCE and the Garda fraud squad will need significant resources, including skilled investigators, to review these new mandatory reports. That is a challenge but the Minister has taken the correct steps and is going in the right direction. I wonder whether we have the resources to do it.

I refer to mandatory electronic surveillance in State owned banks. Who superintends the electronic archival records of Departments in choosing what documents to keep? I would also like an outline of the Government's plans for the digitisation of archives in the future. What else can we do to protect against white collar crime? Given that the banks are owned by the State, can the introduction of more safeguards become mandatory in them to make sure the taxpayer is properly served? At a time when paper documents have almost been made redundant and electronic communication has increased significantly, we must examine new ways to make sure that wrongdoing is not covered up. One research firm, Forrester, says that some corporate e-mail archives are increasing by more than 40% a year.

Information technology companies specialise in e-discovery, the practice of examining electronic records to unearth important data and relationships. In one notable case in the US, a link was found between several executives at a firm who had been issuing bogus invoices to inflate its revenues thanks to such software. That is not unlike the case of Anglo Irish Bank whereby members of the board ended up buying shares in the bank to inflate its value. Given that so much trust has been lost in the banks, should the Government not insist on mandatory surveillance software like this in the banks, especially given its stake in them? K&L Gates, a law firm, said that the recession increases the risk that rogue employees will be tempted to engage in wrongdoing to protect their jobs or bolster their finances. It would be worthwhile to make provision for e-discovery software to be used in banks.

The Minister is heading in the right direction but I have concerns about several areas and I urge him to examine them.