Michael McDowell (Independent) | Oireachtas source

First, I note this legislation started in Dáil Éireann and is coming to this House where it will effectively be amended and it will then, apparently, be approved by Dáil Éireann. There are a few points that I would like to raise, although maybe it is a bit late to do so as it has arrived at this stage in this House.

What we are doing here is conferring on the Central Bank massive powers in regard to individual persons carrying out controlled functions within any financial institution. What we are doing as well is saying that, in future, it will not matter whether the bank itself, or the insurance company or otherwise, is found to have misbehaved or fallen beneath the relevant standards, and that the Central Bank can go after individuals working in those firms.

I want to recall the position briefly for the Minister of State, although I have only been given five minutes to speak on this matter and I can say very little. The Central Bank itself was probably one of the chief architects of the financial crash of 2009 and it got away with murder at the inquiry that was held in these Houses at the time. It said in its annual report of 2007 - I remember it because it was published about a month after I lost my seat as Minister for Justice - that it had carried out due diligence on all of the banks and had stress-tested them, and that they were in a financially robust state. This body has now been given immense new powers, and this is the second tranche of powers that we are conferring on it.

I want to draw to the attention of the House that individuals face personal sanctions of a huge kind, not merely loss of their job but financial penalties, if they are found by a non-court to have offended by a breach of business standards being provided for in this legislation.I also draw the Minister of State's attention to the fact that the duty of responsibility and conduct standards provided for in the new section 53E are demanding when deployed against an individual. These include: "operating without bias and preventing, or identifying and appropriately managing, conflicts of interest". That is a very vague statement, charge or standard to put against somebody who is an executive in a bank. The standards required of people include co-operating "in good faith and without delay with the [Central] Bank, and with authorities that perform functions in a jurisdiction other than the State ... responding to requests and requirements under financial services legislation in an open and timely manner ... disclosing information or records when required to do so under financial services legislation ... attending meetings and interviews when required to do so under financial services legislation". These will now be imposed on individuals personally as standards that they must comply with.

That is all very well but if the Central Bank decides to prosecute individuals within this process, they will be under massive obligations to comply with the inquiry into themselves. If we are not going for the bank, where will the legal aid be for these people? Will a system of legal assistance be provided for people who are at the wrong end of an inquiry of this kind, which can, first, end their careers and, second, impose massive financial penalties on them? Who will give them legal aid to defend themselves in those circumstances? It is all very well to say we will find these people accountable and make them amenable to new standards. I support and have no problem with high standards but when the Central Bank gets on people's case, will they receive any due process in defending themselves when they say it was not them but the board of governors, or their superior or direct line manager, who told them to do these things, and they thought they were doing the right thing? Will they have a defence?

These powers are excessive, and not balanced. The Central Bank prints money, effectively, and individuals who, for instance, might be suspended from their jobs and find themselves defenceless, are provided with no system of defending their good name, or their financial well-being because they are liable to massive penalties, or their right to be employed in financial services in the future. This is overkill legislation.