Gerald Nash (Louth, Labour)
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328. To ask the Minister for Finance his views on a matter (details supplied); if his officials briefed him and-or his immediate predecessor on reported claims made by the senior official; when was he briefed by officials on these concerns; what action he took to address these concerns; if he plans to address these issues by means of amending legislation; and if he will make a statement on the matter. [48368/23]

Michael McGrath (Cork South Central, Fianna Fail)
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The Deputy may wish to note that EU sanctions have direct effect in all Member States of the EU, and they are legally binding on all natural and legal persons. As such, a natural or legal person who contravenes a provision of an EU sanctions regulation would be guilty of an offence and liable to prosecution.

Ireland has strongly supported sanctions in response to Russia’s unjust and illegal invasion of Ukraine in February of 2022 while also consistently emphasising the importance of effective implementation. Eleven packages of sanctions have been agreed by the EU to date. A twelfth package of sanctions will be discussed in the coming weeks.

It is important to note that there is nothing specific in the Section 110 regime that is of particular relevance to Russian investors or originators. Therefore, all such vehicles are in scope of the sanctions regime.

In terms of the issues referred to in the article the Deputy has referenced, in April 2022, my predecessor was informed, as part of a summary of sanctions-related matters, that a concern had been raised regarding the need to ensure that adequate enforcement powers were in place to effectively implement EU sanctions and that an inter-Departmental Review Group was progressing work in this regard.

The Cross-Departmental International Sanctions Committee (CDISC) monitors, reviews, and coordinates the implementation, administration and exchange of information on sanctions in Ireland.

A review of domestic implementation of sanctions commenced in late 2021 which the inter-Departmental Review Group was tasked with overseeing. Given the shift in context for sanctions implementation following Russia’s invasion of Ukraine, this work has fundamentally evolved and progressed with a significant increase in the number and range of sanctions. The framework for domestic sanctions implementation in Ireland continues to be assessed by CDISC. Work is ongoing at CDISC to address any areas identified as requiring action.

Ireland has three competent authorities for all sanctions: the Department of Foreign Affairs, the Department of Enterprise, Trade & Employment and the Central Bank of Ireland. They oversee the different aspects of restrictive measures.

The Central Bank is responsible for the administration and enforcement of financial sanctions. In administering financial sanctions, the Central Bank undertakes the following:

(1) Receives notifications from the financial services industry of assets/funds that have been frozen under the sanctions legislation. In this regard, all natural and legal persons, entities and bodies are required to report information to the Central Bank on assets held by them on behalf of individuals or entities that are subject to an asset freeze. The Central Bank collates the reports of frozen assets for onward transmission to the Department of Foreign Affairs. Currently, approximately €1.8 billion in sanctioned assets has been frozen and notified to the Central Bank by Irish credit and financial institutions.

(2) Assesses applications for derogations that are permitted under the restrictive measures legislation, such as Regulation 269/2014, in respect of financial sanctions.

(3) Engages with the other domestic Competent Authorities and the European Commission to ensure that restrictive measures and financial sanctions are being implemented correctly and consistently. With respect to the EU’s implementation of sanctions, following Russia’s invasion of Ukraine, the Central Bank wrote to Special Purpose Entities (SPEs) with potential Russian links to seek confirmation of their adherence to the sanctions. The Central Bank engaged further with these identified firms, seeking confirmation of the specific steps they had taken to ensure compliance with financial sanctions and restrictive measures, reminding them of their ongoing obligations in this regard.

The Central Bank undertook an assessment of the information received, and based on that assessment, the Central Bank was satisfied that the identified SPEs had taken the necessary steps and had appropriate control frameworks in place to comply with the EU sanctions. The Central Bank did not uncover any actual or suspected breaches of EU sanctions in the course of this assessment. A breach of a financial sanction is a criminal offence under Irish legislation, and therefore, where the Central Bank is aware a breach has occurred or suspects a breach may occur, the matter is reported to An Garda Síochána.

In addition to the above assessment, since the implementation of the sanctions arising from the Russian invasion of Ukraine in February of 2022, the Central Bank has significantly increased its engagement with the financial services sector in order to support and ensure compliance with the EU sanctions. The Central Bank, as part of its ongoing supervision of credit and financial institutions, continues to engage with firms, both regulated and unregulated, to ensure that they have appropriate controls frameworks in place to meet their obligations in respect of financial sanctions and restrictive measures legislation.

The Deputy may also be interested to note that on 2 December 2022 the European Commission put forward a proposal for a Directive to harmonise criminal offences and penalties for the violation of EU restrictive measures (denoted as sanctions). The proposal sets out common EU rules which will make it easier to investigate, prosecute and punish violations of restrictive measures in all Member States alike. As this Directive has a Title V legal basis, Ireland has notified the Presidency of the Council of our intention to opt into this measure under Article 3 of Protocol 21. At last June’s Justice and Home Affairs Council, Ministers agreed a Council General Approach and trilogue negotiations are currently ongoing between the Council, European Parliament and European Commission in order to agree a final text.

Gerald Nash (Louth, Labour)
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329. To ask the Minister for Finance to confirm how many enforcement actions the Central Bank has taken against Russian individuals or entities who are on the EU sanctions list since the current sanctions regime became operational in 2022, and who have a presence in the Irish financial services system vis a vis ‘Section 110’ Special Purpose Vehicles; how many live investigations are ongoing; and if he will make a statement on the matter. [48377/23]

Michael McGrath (Cork South Central, Fianna Fail)
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The Deputy may wish to note that EU sanctions have direct effect in all Member States of the EU, and they are legally binding on all natural and legal persons. As such, a natural or legal person who contravenes a provision of an EU sanctions regulation would be guilty of an offence and liable to prosecution.

The Central Bank of Ireland is one of three Competent Authorities in Ireland tasked with the administration and enforcement of restrictive measures - tasked with the administration and enforcement of restrictive measures the others being the Department of Foreign Affairs and the Department of Enterprise Trade and Employment.

The Central Bank is responsible for the administration and enforcement of financial sanctions. In administering financial sanctions, the Central Bank undertakes the following:

• Receives notifications from the financial services industry of assets/funds that have been frozen under the sanctions legislation. In this regard, all natural and legal persons, entities and bodies are required to report information to the Central Bank on assets held by them on behalf of individuals or entities that are subject to the asset freeze. The Central Bank collates the reports of frozen assets for onward transmission to the Department of Foreign Affairs and the EU Commission.

• Assesses applications for derogations that are permitted under the restrictive measures legislation, such as Regulation 269/2014, in respect of financial sanctions.

• Engages with the other domestic Competent Authorities and the European Commission to ensure that restrictive measures and financial sanctions are being implemented correctly and consistently.

With respect to the EU’s implementation of sanctions, following Russia’s unjust and illegal invasion of the Ukraine in February of 2022, the Central Bank wrote to Special Purpose Entities (SPEs) with potential Russian links seeking confirmation of their adherence to the sanctions. The Central Bank engaged further with these identified firms to seek confirmation of the specific steps they had taken to ensure compliance with financial sanctions and restrictive measures while reminding them of their ongoing obligations in this regard.

The Central Bank undertook an assessment of the information received and, based on that assessment, the Central Bank was satisfied that the identified SPEs had taken the necessary steps and had appropriate control frameworks in place to comply with the EU sanctions. The Central Bank did not uncover any actual or suspected breaches of EU sanctions in the course of this assessment. A breach of a financial sanction is a criminal offence under Irish legislation and, as a result, where the Central Bank is aware a breach has occurred or suspects a breach may occur, the matter is reported to An Garda Síochána.

In addition to the above assessment, since the implementation of sanctions relating to the Russian invasion of Ukraine, the Central Bank has significantly increased its engagement with the financial services sector in order to support and ensure compliance with the EU sanctions. This work includes:

• The Central Bank wrote to firms to notify them of the imposition of the Russia/Ukraine sanctions and provided firms with a link to our dedicated web page on these sanctions. Furthermore, we reminded firms of the necessity to have robust processes in place to comply fully with their sanctions obligations and mitigate the risk to their businesses posed by the sanctions. Following this initial communication, and as part of our ongoing supervisory engagements with regulated entities, there has been a significant focus on Russian/Ukrainian-related issues and sanctions compliance.

• The Central Bank has required a very significant number of firms to submit specific information on their control frameworks for restrictive measures and financial sanctions. The Bank is analysing the information provided by these firms to identify any potential issues. Where appropriate, the Bank will take actions with respect to any identified issues.

• The Central Bank continues to engage with the European Commission, our European peers, the two other Irish Competent Authorities and regulated entities to ensure that there is strong and ongoing awareness of, and focus on, the EU sanctions regime, combined with the need for firms to continue to effectively implement all EU sanctions.

• Continuous updating of the Central Bank web page dedicated to the sanctions related to the Russian invasion of Ukraine, and use of appropriate social media channels to ensure that regulated entities have access to up-to-date information on financial sanctions and restrictive measures as well as the Central Bank’s expectations in relation to compliance with these measures.

In addition to the communication and ongoing engagement with regulated entities, the Central Bank wrote to various representative bodies in the non-regulated sector to alert them to their obligations under the sanctions regulations and to remind them in particular of the obligation to freeze and report the assets of sanctioned individuals.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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330. To ask the Minister for Finance what options are available where lending institutions refuse to lend to a mortgage applicant where the applicant concerned has cystic fibrosis. [48391/23]

Michael McGrath (Cork South Central, Fianna Fail)
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The Central Bank of Ireland is responsible for regulating the provision of mortgage and other credit by regulated financial services providers. As regulator, the Central Bank sets out macro prudential and consumer protection requirements which have the objective of protecting overall financial stability and the interests of consumers.

In line with this mandate, the Central Bank has specified certain loan to value and loan to income thresholds for mortgage lending. In addition, before providing a mortgage lenders are also required to undertake thorough creditworthiness assessments to ensure a borrower will be able to repay the mortgage. This assessment must take into account the individual circumstances of the borrower, including personal circumstances and financial situation.

Within the parameters of this regulatory framework, the decision to grant or refuse an individual application for mortgage credit is a commercial decision to be made by the regulated entity and, as the Minister for Finance, I have no function in such matters.

Where a lender refuses a mortgage application, the lender must inform the consumer without delay of the refusal. In addition, the lender must clearly outline to the consumer the reasons why the credit was not approved, and provide these reasons on paper if requested. If a mortgage applicant is not satisfied with how a regulated firm is dealing with them, or they believe that the regulated firm is not following the requirements of the Central Bank’s codes and regulations or other financial services law, they should make a complaint directly to the regulated firm.

If they are still not satisfied with the response from the regulated entity, the response to their complaint from the regulated entity is required to include details for the borrower on how to refer their complaint to the Financial Services and Pensions Ombudsman.

As regards access to mortgage protection insurance in the context of an application for mortgage credit, I understand that there are financial brokers working on behalf of consumers who have specific medical conditions that may affect their applications for life cover as they would be better placed to understand which insurer might be more likely to provide cover in such circumstances.

Brokers Ireland has established a register of advisors/brokers who specialise in sourcing cover for individuals who have difficulty in obtaining life cover due to a pre-existing illness and which is available from their website. Insurance Ireland also operates a free Insurance Information Service for members of the public, which deals with general queries in relation to insurance cover.

This service can be accessed by constituents by calling 01-676-1820 or by emailing feedback@insuranceireland.eu.

In addition, there is a provision under Section 126 of the Consumer Credit Act1995whereby lenders can provide a mortgage in situations where a borrower may be unable to obtain life insurance, or where such insurance is unduly costly compared to that payable by borrowers generally.

For individuals, including those with underlying health conditions and who may experience difficulties acquiring mortgage protection insurance, this is an important provision that relevant mortgage applicants should be aware of and discuss with their lender.