Bill to set up new agency with powers to tackle white-collar crime

Extensive powers are to be given to a specialist agency which will combat white-collar crime and other breaches of company law, a Bill published today reveals.

An office of the Director of Corporate Enforcement is to be established with legal, accountancy, administrative and Garda staff and an annual budget of £3 million. It will be set up under measures contained in the Company Law Enforcement Bill, published by the Tanaiste, Ms Harney.

The new director will take over the role Ms Harney has played in recent years in the appointment of authorised officers and inspectors to investigate corporate scandals. It means that in future the attitude of the incumbent minister will not determine the extent to which such controversies are investigated.

Ms Harney has instigated investigations into the Ansbacher deposits, Celtic Helicopters, National Irish Bank and Mr Michael Lowry's Garuda Ltd. Her appointment of an authorised officer to two companies in the Dunnes Stores group is being challenged in the courts.

The Government approved the new proposals after considering the recommendations of the Working Group on Company Law Compliance and Enforcement, which was chaired by Mr Michael McDowell SC, now the Attorney General, and which was published in March 1999.

"It was judged to be more cost-effective, more efficient and less politicised if the decision on whether to initiate a company law investigation or a criminal investigation in any particular case was centralised with the director," according to an explanatory memorandum published along with the Bill.

If "serious breaches" of company law are to be remedied, the enforcement role has to be transferred from the Minister for Enterprise, Trade and Employment "to a specialist unit with the necessary resources and skills to enforce the law on a consistent and independent basis".

The Bill is to begin its passage through the Oireachtas in October. An interim director and some staff are to be appointed in advance of enactment so the office will become functional at the earliest possible date.

The director is to be appointed by way of a competition through the Civil Service Commission and will have a term of five years, which may be renewed.

The director is to enforce compliance with company law and prosecute summary offences; investigate suspected offences under the Companies Acts; refer cases to the Director of Public Prosecutions for prosecution on indictment; and exercise a supervisory role over the activities of liquidators and receivers in the discharge of their functions under the Companies Acts.

The director and his or her staff will have an obligation of confidentiality in order to encourage confidential reporting of suspected offences. However, the passing of information between the Garda and the new agency will be permissible.

The Bill will change the law in relation to inspectors appointed under the Companies Act, making it easier for them to pursue their inquiries into the affairs of a company which has a commercial relationship with the company to which they were originally appointed.

It will extend the powers of inspectors in relation to questioning accountants, bookkeepers and taxation advisers who have been employed by the company being investigated.

The director will have the power to restrict or disqualify company directors, to freeze assets and to levy on-the-spot fines. He or she will also have the power to direct the production of the minutes of company general meetings and meetings of directors.