“The white-collar crime of tax fraud is no less shameful than simple theft and is not entitled to a more lenient attitude by society.” So said Richie Ryan, the Minister for Finance in 1976.
Unfortunately, the justice system did not receive the ministerial memo and in terms of leniency, the period of post 1976 looked pretty much like pre-1976.
In fact, the states’ lack of urgency in addressing white-collar crime led an almost newly minted TD by the name of Ivan Yates to wonder aloud in 1983 about what exactly was being done to tackle the “alarming” growth of fraudulent financial criminal activity.
Yates was speaking during a Dáil debate on what would become the Criminal Justice Act 1984.
And although that legislation dealt with such areas as the period of detention a person could be held for and the right of a garda to arrest a person without a warrant, it was silent on dealing with the more gentlemanly forms of crime.
Yates provided the example of the Copyright Act, 1963 and “the pirating of tapes — videotapes, films and so on.” This was an activity that brough “vast profits” to criminals:
A disbelieving sounding Yates then asked:
“What is the penalty for conviction under this Act? It is a fine from a minimum of £5 to a draconian maximum of £100.”
At a later stage of the same debate we hear a young Mary Harney acknowledge that while there is white collar crime in this country, “we do not hear very much about that. We do not see many of them in the statistics placed before us all the time.”
It was time, she said, “that we redefined our approach to crime and ascertained who exactly are the criminals in our society.”
This idea of a perception gap that needed to be addressed was eventually picked up and acknowledged in a 1984 Report from the National Economic and Social Council entitled “The Criminal Justice System: Policy and Performance”:
“Though an abhorrence of “street crime” such as robbery is virtually universal, if we measure the cost of crime in financial terms, “white collar” crimes, such as embezzlement and fraud, inflict the greater loss.”
Over the following years we do see a blitz of legislative action being taken to address the peculiar nature of white-collar crime and so we get Government Advisory Committee on Fraud which reported in 1992, The Criminal Evidence Act 1992 and a number of other statutes to address the admissibility of documentary evidence in prosecutions e.g., Company Law Enforcement Act 2001 and the Competition Act 2002.
The important question of course is whether or not any of this had a major impact?
Not according to a Department of Justice White Paper on Crime published in 2010 (post financial crash).
There it was accepted that despite all the legislative resources a lower rate of prosecution and conviction remained stubbornly persistent due to the difficulty in defining, detecting and investigating white-collar crime.
This was despite the fact that The Office of Director of Corporate Enforcement (ODCE) had been established under the Company Law Enforcement Act 2001 to “enforce and encourage compliance with company law.”
Fast forward to 2019 and we see the ODCE Director Ian Drennan being hauled before an Oireachtas committee over his agencies “catastrophic” role in investigating and bringing to book Anglo Irish Bank and its chairman Sean Fitzpatrick.
On a sympathetic reading however it is difficult to blame the Director too much. He has had to operate in a constantly resource starved environment and has been left repeatedly scrambling for basic staffing requirements such as forensic accountants and garda assigned personnel.
Rather astonishingly the number of Gardaí assigned to the ODCE on 02 September 2019 was just 7.
Indeed just last week, the Director was out once again to lament the fact that over the last year he has had to more or less beg for the approval of a requested allocation of six detectives to strengthen the ODCEs investigative capacity.
Are things ever going to change?
If you believe Leo Varadkar, then the answer is yes.
In August his Department, which oversees responsibility for Company Law, secured government approval to publish the Companies (Corporate Enforcement Authority) Bill 2021.
According to the Tánaiste this will transform the Office of the Director of Corporate Enforcement (ODCE) into a statutory and independent agency with additional resources to investigate and prosecute white collar crime, and “when enacted will be a milestone in the area of corporate enforcement in Ireland.”
Mind you, in 2001 Minister Mary Harney who was bringing forward the Bill that would create the ODCE, said more or less the same thing:
“With the allocation to the director of sufficient resources to properly and effectively investigate suspected offences under the Companies Acts, I expect that this power of prosecution will result in a far greater number of offences under the Acts coming before the courts and in many more convictions being secured.”
Nothing of the kind ever happened.
For you see, the next year Fianna Fail took office as the majority partner in government and it would remain there for a decade, allowing what many would justly describe as a ‘lax’ attitude to financial regulation to build up.
That culture is still with us regardless of what the statute books say. Just look at the recent debacle at Davy stockbrokers. Yes, it received a €4.13 million fine from the Central Bank, but will anyone see the inside of a jail cell? Not on your life. That kind of thing is reserved for people who steal a couple of euros worth of grub from Lidl.