Monday, 14 June 2021
Counterfeiting Bill 2020: Second Stage
I welcome the opportunity to present the Bill to the House. The euro is the second most widely used global currency after the US dollar. Figures released by the European Central Bank this year show there are 25 billion euro banknotes in circulation, with a value of over €1.4 trillion. Responsibility for protecting the euro currency against counterfeiting is shared between the EU authorities and all member states. This is achieved through a comprehensive package of technical, administrative and criminal law measures, which have over time proven to be very successful. Figures published by the ECB in January show that counterfeiting is down 17% year-on-year and is now at an historically low level. In 2020, the chance of a note being counterfeit was only 17 in 1 million and most counterfeits are of low quality and are quickly detected and removed from circulation.
Although this threat has been contained, with high-tech security features making euro banknotes secure and easy to distinguish from counterfeits, the regime will continue to evolve to ensure protection in the future. This Bill will update Irish law to reflect four pieces of EU legislation in the area. These are, by and large, already implemented, either in law or existing practice, and the Bill reflects the evolution of an already successful regime to ensure that we meet our EU obligations.
The current law in regard to counterfeiting is contained in Part 5 of the Criminal Justice (Theft and Fraud Offences) Act 2001, which gives effect to the earlier EU measure in this area, namely, Framework Decision 2000/383/JHA. The 2014 directive updates and replaces that 2000 framework decision and establishes minimum rules concerning the definition of criminal offences and sanctions in the area. Article 3 of the directive requires criminal offences to be in place in respect of making, altering or importing counterfeit currency and possessing instruments and security features for making counterfeits. While, for the most part, the provisions on counterfeiting in our existing 2001 Act meet the requirements of the 2014 directive, it is necessary to make a number of amendments to this Act to align with the 2014 directive and to fulfil our obligations.The European Commission issued a reasoned opinion on 3 December 2020 to Ireland in respect of the remaining aspects of the transposition of this directive and there has been ongoing engagement with the Commission. Several aspects of the directive are being refined and clarified by this legislation, including the import-export of counterfeits from non-EU states, the use of legal instruments for illegal purposes, the counterfeiting of non-circulated currency, possession of materials that may be used for counterfeiting, extra-territorial jurisdiction and liability of bodies corporate. These changes are contained in Part 2.
In addition to transposing the outstanding elements of the 2014 directive, the Bill will also provide for statutory powers in respect of monitoring, supervision, enforcement and some related powers relating to three interrelated EU legal instruments that are in force: Regulation 44/2009, amending Regulation 1338/2001, laying down measures necessary for the protection of the euro against counterfeiting; Council Regulation 1210/2010 concerning authentication of euro coins and handling of euro coins unfit for circulation; and European Central Bank Decision, ECB/2010/14, on the authenticity and fitness checking of bank notes.
Part 3 will place existing supervisory practice in respect of these measures on a statutory footing and give the Central Bank of Ireland, CBI, powers in respect of some firms that do not financial regulation legislation. These issues:are primarily the responsibility of the Minister for Finance and his officials have been closely involved in the development of the Bill. The provisions in Part 3 will provide the necessary powers:and functions for the CBI in respect of monitoring and enforcement measures relating to suspect counterfeit euro currency and currency deemed unsuitable for recirculation. The CBI is also the Irish branch of the ECB and, therefore, is responsible for, and needs the power to, fitness check euro notes and coins.
Part 4 places on statutory footing the designation of the currency centre of the CBI as the national analysis centre for euro notes and the coin national analysis centre, CNAC, for euro coins. It also provides for the recovery of costs by the CBI in respect of euro coins, in particular the protection of the euro against counterfeiting. Part 4 also contains consequential amendments to other legislation.
I will now move on to the specific provisions of the Bill. Part 1 is a standard provision that sets out the short title of the Bill and the arrangements for the commencement.
Part 2 sets out the amendments to the Criminal Justice (Theft and Fraud Offences) Act 2001 to give full effect to the 2014 directive.
Sections 2 and 3 provide for relevant definitions. Section 4 creates a specific offence of making or altering a designated note or coin with the intention of passing it off as genuine.
Section 5 creates a new offence of receiving, obtaining or transporting anything a person knows or believes to be a counterfeit note with the intention of passing it off as genuine. This complements the existing definition under section 34 of the 2001 Act.
Section 6 substitutes the existing offence in section 36 of the 2001 Act in respect of receiving, obtaining and having control or custody of currency instruments, counterfeiting instruments or security features for the purpose at making a counterfeit note or coin with the intention of it being passed off as genuine.
Section 7 revises section 37 of the 2001 Act in respect of importing or exporting a counterfeit or currency note or coin.
Section 8 provides for extraterritorial jurisdiction in respect of the relevant offences under the Part and amends section 38.
Section 9 provides for liability by a body corporate and inserts a new section 38A.
Section 10 amends section 39 of the 2001 Act by defining "designated bodies", "credit institutions", "transporter of funds" and "payment service provider". The new definition of a credit institution will incorporate a number of institutions previously listed in section 39.
Section 11 provides for a technical amendment to section 58 of the Act of 2001 regarding liability for offences by a body corporate to exclude its application to Part 5 in view of the new section 38A inserted by section 9.
Part 3 relates to the obligations of relevant persons in respect of ensuring authenticity and fitness of euro bank notes and coins. it sets out the new monitoring, supervision and enforcement powers of the CBI.
Section 12 provides the definitions that will apply to Part 3, including the "relevant persons" to which the obligations apply. Section 13 provides for the functions and powers of the CBI, including monitoring and taking measures to ensure compliance with the EU instruments, verifying the specific procedures referred to and performing the specific controls and functions referred to.
Section 14 provides that the CBI may impose requirements on relevant persons to take specific measures, including measures to rectify non-compliance with certain obligations and to comply with the condition of a permission granted by the CBI.
Section 15 provides for regulation-making powers for the CBI.
Section 16 provides that where it is necessary for the purpose of the performance of its functions under this Part, the CBI may require a relevant person to provide information, records, plans, etc.
Sections 17 and 18 provide for the appointment of authorised officers by the CBI to perform the functions under section 13.
Sections 19 to 21, inclusive, deal with the powers of an authorised officer to enter a premises for the purpose of the performance by the CBI of its functions under section 13. A number of other sections provide for technical and numerous amendments.
Part 4 addresses ancillary matters.
In conclusion, this Bill will fully update Ireland's legal and administrative regime in respect of counterfeiting and ensure that our law is in line with European requirements.
I am not sure I would call it a coup. I am just looking around the Chamber and seeing colleagues I knew in UCD but also a councillor in Dún Laoghaire-Rathdown County Council - Senators Ward, Boyhan and Conway, who was in UCD with me. Ireland feels that bit smaller today than it ever did. It is my first opportunity to congratulate Deputy Browne on his appointment as Minister of State with responsibility for law reform. I have been appointed as Fianna Fáil spokesperson on law in the Seanad so that might be why I managed to achieve this small coup, as the Leas-Chathaoirleach called it. I will certainly not repeat all of the very informative speech given by the Minister of State detailing all 33 sections.
Much of what we are implementing now is there in practice, if not in law. Hopefully, in future, we can bring the euro to the countries we used to be able to use it in such as Spain, Portugal and France when we get travelling again. In the past year, probably more than ever, we have used fewer coins and notes than we ever did. Electronic money, tap and go, chip and pin and all the other technologies probably mean that we will use less hard cash than we ever did. Nevertheless, it is very important legislation. A Fianna Fáil Minister is bringing it through the House and along with the rest of the Government, the Fianna Fáil group is supporting it. Much of it is in place. It is very important that we do it and we have those security measures in place across the eurozone to deal with anyone who is caught for or involved in the counterfeiting of euro notes or coins, which we know was big business with lots of criminal gangs and organised crime outfits involved in the forging of notes and coins. It is probably less prevalent because standards are getting higher and higher. I welcome this Bill and I will not delay the House on it. I thank my colleagues, particularly Senator Gallagher, for deferring to me on this occasion.
I concur with Senator Horkan's contribution. I welcome the Minister of State to the House. Some would say that we are merely engaged in a bit of housekeeping. As the Minister of State outlined, the Bill reflects what we are already doing and transposes an EU directive into Irish law, which is to be welcomed. Senator Horkan said I stood aside to let him speak on this occasion. As the Leas-Chathaoirleach knows, us country boys are very obliging and we would not like to think that the city slickers would take advantage of it. I have no doubt that this will not happen.On a more serious note, I am not going to delay the passage of the Bill through the House. I look forward to its speedy journey through the House. As Senator Horkan outlined on behalf of Fianna Fáil, I am delighted to support this legislation.
I welcome the Minister of State to the House. I support the Counterfeiting Bill 2020, which updates Irish law to reflect EU legislation in the area of counterfeiting. It is important and it is a good legislation. The purpose of the Counterfeiting Bill is to complete the transposition of Directive 2014/62/EU and to make provision for three additional EU instruments dealing with authenticity, the fitness of checking of euro bank notes and coins and measures for the protection of the euro against counterfeiting.
I note the Bill specifically relates to the counterfeiting of hard cash, both notes and coins, but it does not relate to online money laundering. Perhaps the Minister of State can confirm that.
I understand the Department of Finance and the Office of the Attorney General have worked closely with the Minister of State's Department to draft this complex but necessary legislation. The proposed changes in this Bill will give powers and functions to the Central Bank of Ireland to monitor and enforce measures relating to suspected counterfeit euro currencies. That is to be welcomed.
As I stated previously, the Bill does not relate to online money laundering, which is of concern. I took the time to look at the contributions of the Minister of State in the Lower House on this matter and I understand from some of the commentary in the Dáil that the Government proposes to introduce separately measures on cybersecurity, fraud, anti-money laundering and terrorist finances through other legislation. Therefore, it would be helpful if the Minister of State would advise this House of his intentions in relation to those issues. While they are not part of this legislation, they are related to it and they are important. Every day of the week, we hear about financial, money and counterfeiting crimes. It is a challenging area and a difficult issue. However, the issues of cybercrime, fraud, anti-money laundering and terrorist financing are important and need to be addressed. I would like to hear what the Minister of State's intentions are in relation to the matter.
Perhaps the Minister of State will also advise the House if he has requested observations from the European Central Bank or other stakeholders in relation to the substantive content of this Bill. Have they responded to any request that the Minister of State has made of them? If so, what has been the response of the Minister of State's Department to those issues? If the Department has not responded, I ask the Minister of State to confirm that contact has been made with stakeholders and that they have been invited to make a submission. If stakeholders have not made a submission, what steps has the Department taken to engage with them? Hopefully, they have responded and the Minister of State is in a position to share their response with us this evening. Certainly, I would hope their response can be shared with us between now and the next time this legislation comes back to the House.
I also want to take this opportunity to acknowledge and thank An Garda Síochána's National Economic Crime Bureau for its continued work, albeit behind the scenes. We do not know much about it but we know it is going on. I thank the unit for its work in challenging counterfeiting, and in particular, the payment card and counterfeit currency unit that is operating successfully. It focuses on tackling money fraud and counterfeiting crime.
This Bill seeks to update Ireland's legal and administrative regime in respect of counterfeiting. I support the work of the Minister of State and the key objectives and principles of this important Bill.
Cuirim fáilte roimh an Aire Stáit go dtí an Seanad agus fáiltím roimh an mBille. Is Bille an-tábhachtach ar fad atá i gceist anseo, fiú go bhfuil sé ar an taobh teicniúil den chuid is mó. Is trua é nár bhaineamar an spriocdháta chun an treoir Eorpach a chur i bhfeidhm amach ach tá áthas orm fáilte a chur roimh an mBille seo, a dhéanann an obair sin.
Having listened to the contributions of other speakers and Senators on this Bill, I must say that it is welcome. The Bill goes through a number of boxes that need to be ticked from the point of view of the implementation of the European law. I agree with the course of action being taken by the Government to separate cybersecurity from counterfeiting. While I recognise that they occupy the same space in many respects, they are very different issues. I do not think that we could use amending legislation, as this one is in respect of the Criminal Justice (Theft and Fraud Offences) Act 2001, to implement all of the quite complex measures that need to be put in place to deal with counterfeiting and those issues. I welcome the Bill in that regard.
I particularly welcome the extra-territorial elements in section 8 of the Bill, which are most important, particularly now. I know others Senators have mentioned that we are dealing in cash less than we were, but that overlooks the importance of this particular legislation. As ordinary citizens, we are using less cash. We are using contactless payments. People can make payments using their mobile phones or they can tap and go. That leaves a very clear digital trail behind the expenditure in and out of one's account. That is not something that is necessarily entertained by criminal elements who want to use cash to buy goods, services, or whatever it might be. Cash still has a very significant role in the underworld, the black market and with criminal elements. It is entirely appropriate, therefore, that we are dealing with it. I do not think that cash is so far gone beyond the use of society that we should not put in place these measures.
It has been recognised that many of these measures are technical. They represent things that are happening in practice already. It is extremely important that we satisfy and tick that box to say that it is done and that we are now implementing the European legislation, albeit late. It is also important that we, as an outlier in Europe, geographically, and next to a country which is now a third country and one through which many people must travel if they are going over land with goods to the Continent, have in place these measures and the amendments to the 2001 Act to ensure that we are as safe as possible in terms of having the powers that the Office of the Director of Public Prosecutions and law enforcement need to tackle any counterfeiting that might be going on.
I welcome the Minister of State to the House. I welcome also this legislation, which essentially transposes into Irish law the EU directive of 2014 on the issue of counterfeiting and counterfeit euro notes and kinds. Why has it has taken more than seven years for something as important as this to be implemented? I agree that the use of cash has decreased dramatically, particularly in the last year, in our country. Nonetheless, the use of cash will continue for many years into the future. As such, we must ensure that we have the necessary armoury to deal with counterfeiting because it is a problem across Europe. Other European countries have transposed the directive into law. We are coming to the table late. We need to have a discussion in broad terms as to why it has taken nearly a decade to implement what is law in Europe and what was decided in Europe seven or eight years ago.
I also agree with my colleagues in respect of other measures in terms of cybersecurity. Chip and PIN cards, contactless payments and credit cards are used everywhere now, from taxis to restaurants to the purchase of property. I absolutely agree that we need to bring forward very robust legislation to deal with crime in this area. As consumers use of Internet banking, laser cards, other forms of technology and apps such as Revolut and PayPal increases, criminals will follow. They will find ways of infiltrating it and scamming people. Therefore, we need to ensure that we have the armoury, in terms of the legislation, that is necessary to deal with it. We must ensure that we equip An Garda Síochána, the Revenue Commissioners and the other arms of the State with the necessary legislation so that they are in a position to deal swiftly with this type of crime when inevitably increases. It is already a problem, but it will increase.
This legislation, albeit late, is welcome. I sincerely hope that it passes all Stages in the House without division.
The Green Party also welcomes the Bill. We are the last member state to transpose the directive of 2014.The transposition of the EU directive relates to the protection of the euro and other currencies against counterfeiting, as was said by previous Senators. It will give effect to European Council and Parliament regulations dealing with it and also with the authentication of euro coins. It will give effect to an ECB decision regarding the authenticity, fitness checking and recirculation of euro banknotes and it makes provision regarding the designation of the National Analysis Centre for euro notes and the CNAC for euro coins. The Bill introduces criminal offences and grants additional monitoring and enforcement powers to the Central Bank. It also provides for a range of new powers and functions for the CBI in respect of monitoring and enforcement measures relating to suspect counterfeit currency and euro currency that is not deemed to be suitable for recirculation.
The Green Party unreservedly welcomes the Bill. The ECB and the State must invest as much they can in safeguarding our financial security online. Is the Minister of State satisfied that enough is being done? Has the Department sufficient resources in managing what is an ever changing situation? The Continent and the EU have seen incredible changes. What we have now is unrecognisable from what we had at the start of the Covid. As previous contributors said, we are moving to contactless payments. Coins and notes could be a thing of the past. We will have to revisit it sooner than we think to keep up with the counterfeiting measures of tomorrow and the futuristic approach to ensure we are one step ahead of the fraudsters who are only too keen, willing and able to defraud us and society. We must be on our guard at all times. I welcome this Bill. I also welcome the Minister of State to the House, which I should have said at the start.
Cuirim fáilte roimh an Aire Stáit. I will not needlessly delay the House or the passage of this Stage other than to say I share the concerns and regret of some colleagues about the delay in the Bill coming before the House. A number of colleagues also raised the issue of new forms of criminality with respect to finances and how way we adapt to counterfeiting given the increasing move to online services and various services referenced by Senator Conway, be it PayPal or whatever it may be. My colleagues in the other House expressed a range of observations during debates on earlier Stages of the Bill as it went through the Dáil and I reiterate those points. We in Sinn Féin support the Bill. It is important the Minister of State would at least made some reference to the questions relating to the online issue.
I welcome the Minister of State. Many questions have been raised in welcoming this legislation. We are supporting what has come from Europe. This Bill is about protecting the consumer and business people. As a former business owner, I am aware of people who had their cards stolen and used or who have been scammed. There has been a major increase in people using their cards and it is all about the Internet. As a colleague said, the fraudsters are always two steps ahead of everyone else. The tighter we can make the legislation to protect everybody, the better. I welcome the legislation and support it. It is important to put as many measures in place as possible to protect against fraud. I pay tribute to the members of the Garda who assist people who have been scammed or have been the victim of a counterfeiting fraud offence, be it counterfeit notes or cards.
I thank the Senators for their valuable contributions to the debate. While the Bill, for the most part, is technical in nature, its subject matter is very important and it also tangentially touches on very important issues.
Regarding the delay in bringing forward the Bill, when I was appointed as Minister of State last September, a significant number of EU directives needed to be transposed. With great thanks to the departmental officials and with the support of the Seanad, we have been able to clear out a significant number of those, including the Criminal Justice (Mutual Recognition of Decisions on Supervision Measures) Act, the Criminal Justice (Money Laundering and Terrorist Financing) Act and the Criminal Justice (Theft and Fraud Offences) (Amendment) Act 2021. There was a backlog and a delay but we are working hard to clear that backlog and we have gone a significant way towards doing that, and we are also dealing with this Bill today.
On the issue of white-collar crime and online corruption and crime, I reference some of those Bills we passed. The Criminal Justice (Money Laundering Terrorist Financing) Bill, which was signed by the President and enacted, seeks to tackle and update our laws in line with the EU on tackling online money laundering and terrorist financing. Cross-border measures and co-operation are fundamental. Criminals are operating cross-border and on an international scale. States need to work and co-operate together. Similarly, the Criminal Justice (Theft and Fraud Offences) (Amendment) Act 2021 also seeks to tackle corruption that may be happening within the Union. The Minister, Deputy McEntee, published the Hamilton review and it forms a fundamental part of the justice plan of 2021 in tackling corruption and white-collar crime. That would include any online aspects. The Minister published a cross-governmental plan on implementing the review on 19 April 2021. This sets out 22 actions to be implemented over the next 18 months. It is a very comprehensive plan which will target a great deal white-collar crime and corruption. I echo the sentiments of Senator Boyhan in thanking the Garda National Economic Crime Bureau for its sterling work in this area. It will see its number of officers rise from 46 to 112 as well as a significant investment in ICT to enable the bureau to target online white collar crime and corruption.
In accordance with the obligations under the Treaty on the Functioning of the European Union, TFEU, and the European System of Central Banks, ESCB, statute, the ECB was consulted by my colleague, the Minister for Finance, on this Bill and an opinion from the ECB was received in February. This opinion was supportive of the Bill in general stating that the ECB welcomed the draft law, which will ensure the preservation of euro banknotes and coins in circulation resulting in continued public confidence in euro banknotes. The opinion, however, noted the CBI should be remunerated for its task regarding euro coins and, in particular, relating to the protection of the euro against counterfeiting, and there was a note of concern that this was only partially done at present. That matter was raised by Deputy Howlin in the Dáil and we addressed it then. An amendment was accepted on Report Stage in the Dáil to address any outstanding concerns regarding the ECB.
I am happy to engage with the Senators on this Bill. It is an important one that we can deal with as quickly as possible. I am happy to address any concerns Senators may have.