THE PUBLIC reaction to aspects of the annual report of the Office of the Director of Corporate Enforcement (ODCE) will be a mixture of satisfaction tinged with disappointment. Satisfaction that despite the trading difficulties the recession has presented, director Paul Appleby has found no notable deterioration in the standard of directors’ behaviour overall.
But disappointment at the pace of progress of investigations into possible criminal offences at Anglo Irish Bank. That inquiry has absorbed one third of the staff of the ODCE and, although Mr Appleby says “good progress” has been achieved, he is unwilling to set a date for completion of its investigation which began early last year.
There are now no fewer than three inquiries under way into Anglo Irish; the others involve the Financial Regulator and the Garda Fraud Bureau. Mr Appleby has readily acknowledged the public’s desire for a resolution of matters at the bank, while pointing out that in large- scale commercial investigations to secure the “evidence for potential criminal proceedings is a painstaking process”. It may yet be several months before the ODCE is in a position to refer matters to the Director of Public Prosecutions James Hamilton who must then decide how to proceed. In recent weeks, Mr Hamilton has questioned whether expert specialist juries, with suitable financial qualifications, are now needed to serve in some types of white-collar criminal trials, given their difficulty and complexity. He has also suggested that the introduction of legislation to protect whistleblowers could make such cases easier to prosecute.
Ireland has had a poor record in the prosecution of white-collar crime. The various banking scandals of recent decades have seen no successful prosecutions, which resulted in jail sentences in this jurisdiction. In 2003, AIB’s rogue trader John Rusnak – who lost the bank $691 million in a currency fraud – was jailed in the US. And in 1990, the late Patrick Gallagher served his prison sentence in Northern Ireland following the failure of his company, Merchant Banking. But he never faced prosecution for offences in the Republic. The provisional liquidator appointed to the bank had found evidence of 79 criminal offences here.
The ODCE has a €6 million annual budget but, unlike the Central Bank, it is subject to the public service recruitment embargo. For a State agency that has a lead role in investigating suspected corporate crime, lack of resources – financial or professional – should not become a constraint on its work at a critical stage.