Michael McGrath (Cork South Central, Fianna Fail)
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94. To ask the Minister for Finance the amount transferred to parent companies outside Ireland that is classified within management expenses by participants in the insurance market here, specifically non-life insurance in each of the years 2013 to 2017, in tabular form, based on the data gathered by the Central Bank; the percentage of the entire amount of management fees in the non-life insurance market that is transferred to parent companies outside Ireland; his views on whether the companies are shifting profits outside of Ireland by using the management expenses classification; and if he will make a statement on the matter. [18968/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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In my role as Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Consequently my Department has no role in collecting the information being sought by the Deputy.

In order to address the questions posed, my officials contacted the Central Bank of Ireland on this matter. The Central Bank advised that the information collected from companies does not identify separately payments made to or received from other group companies. Therefore the breakdown being sought by the Deputy is not available.

With regard to views on whether insurers are shifting profits outside of Ireland by using the management expenses classification, the Central Bank has informed me that it is not evident that there is any material transfer of profits via management expenses to parent companies. It does acknowledge however that in some instances, an Irish insurer may receive services from its group, which it pays for.

Michael McGrath (Cork South Central, Fianna Fail)
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95. To ask the Minister for Finance the requirements imposed on financial institutions in respect of maintaining a record of politically exposed persons; the reason customers opening accounts are asked a question regarding the issue; and if he will make a statement on the matter. [19016/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy will be aware financial institutions are designated persons under the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (“the Act”) and are obliged to comply with the regulatory obligations contained under Part 4.

Section 37 of the Act obliges designated persons totake steps to determine whether a customer, or a beneficial owner connected with the customer or service concerned, residing outside the State, is a politically exposed person or an immediate family member, or a close associate of, a politically exposed person.

A “politically exposed person” (“PEP”) is defined as an individual who is entrusted with a prominent public function, including a specified official and a member of the administrative, management or supervisory body of a state-owned enterprise and includes a “close associate” and an “immediate family member” under the Act.

Under AML legislation, a designated person is obliged to take steps prior to establishing a business relationship with the customer or when carrying out an occasional transaction with, for or on behalf of the customer or assisting the customer to carry out an occasional transaction. The steps to be taken are such steps as are reasonably warranted by the risk that the customer or beneficial owner is involved in money laundering or terrorist financing.

Where a designated person has knowledge of or reasonable grounds to believe that a customer is a PEP, or is an immediate family member or a close associate of the PEP, a designated person is obliged to apply the following measures:

(1) obtain approval from senior management prior to the establishment of a business relationship with the customer; and

(2) determine the source of wealth and the source of funds related to transactions and services provided.

A designated person that cannot fulfil its obligations in respect of its obligations should not carry on a business relationship or provide services to a customer or beneficial owner as provided for in the Act.

It is a criminal offence for a designated person to not comply with its obligations pursuant to section 37.

It is also worth noting that the categories of individuals regarded as Politically Exposed Persons (PEPs) has been broadened under the EU’s Fourth Anti-Money Laundering Directive (4AMLD) to include domestic PEPs. Those elements of 4AMLD will be transposed into domestic legislation in due course by my colleague the Minister for Justice and Equality. This will mean that domestic PEPs will be in scope for enhanced due diligence measures. This will be a significant departure from the Act where currently only foreign PEPs are subject to enhanced due diligence measures from designated persons.