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Crippling the whitecollar crimebusters - how FF did it.

He3

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No one can accuse Fianna Fáil of being shortsighted.

As the country is brought to its knees by corporate criminals, people are calling for retribution - like jailing the bank robbers.

There is just one small problem. The authority set up to enforce corporate laws is a shadow of what we need now. Its boss - a dedicated professional -tried his best to build the Office of the Director of Corporate Enforcement into a body that could do a job. The government blocked him. Few of us noticed at the time.

One who did notice was Gene Kerrigan. This is what he wrote less than two years back. Read it and rage.

Gene Kerrigan on 4 March 2007 in the Sunday Independent:


Who's Paul Appleby? Mr Appleby is to corporate crime what Domestos is to germs. At least, that's the theory. He heads up the Office of the Director of Corporate Enforcement (ODCE).
...
For the past three decades, Ireland has had more fiddles than a violin factory. Various investigations have shown that many of the family fortunes and business successes of today were built on fraud. Elite business people, huckster hoteliers, bankers and Cabinet ministers arranged the tax fraud that suited them best. Major decisions on where we live and how long it takes us to get to work were made on the basis of bungs and backhanders.

The lackadaisical government attitude to white collar crime became so notorious that over the past decade many of the most controversial characters in the global insurance business made their way to Dublin.


Kerrigan was not the only one to notice the consequences of what was laughably called 'light regulation' -

In April 2005, the New York Times wrote of the "light hand" of corporate regulation that encouraged such people to gravitate to these shores: "Dublin has become known in the insurance industry as something of the Wild West of European finance".

When corporate crime flourishes, customers are ripped off, shareholders are cheated. The State is defrauded, increasing the tax burden on the rest of us. Honest businesses go to the wall, undercut by competitors who take illegal shortcuts.


Sound familiar?

Listing the number of crooks the ODCE had successfully nabbed with its existing staff Kerrigan tells the remarkable story of how our government reacted to a request for a few more staff to beef up the office:

Mr Appleby has just 36 employees,including six gardai.
...
After three years in business, having demonstrated what can be done, Mr Appleby applied for an increase in staff. He waited, and waited. Last week, through a Freedom of Information request, RTE dug out correspondence in which Appleby said his resources are "wholly inadequate". Because of the volume of work, the intricacy, the need for specialists, without resources there's inevitable delay. Delay means cases collapse. White collar criminals know every wrinkle in the law in which they might find refuge - they can afford battalions of lawyers to search for loopholes.

...
Mr Appleby applied for 20 more staff, including four gardai. This request seems based in logic, requesting people with particular skills for specific jobs that need doing.

Only when the matter became public, two years after the request was made privately, did the Government say they'll give the ODCE four new staff. And there's a promise that there'll be another four - one of these days.

In the Dail, Bertie Ahern became waspish. "It is not that Mr Appleby's work is not considered important . . . it is a question of prioritising the placement of staff."

Bertie was indignant. "He has 36, so it seems extraordinary that he could want another 20." The fact that the staff are needed to get the job done seems irrelevant. "One would not receive such an increase in any department," huffed Bertie. "He will have to wait his turn."

The ODCE, said Bertie, "can wait a few more years if the staff are required". ... What's going on?

As RTE reported, shortage of staff means that "a substantial number" of investigations into corporate wrongdoing "will not be pursued". We can see that certain types of business people might want that, but not the Government, surely? We'll forgo millions from chancers. They'll continue to break the law.

Their freedom will encourage others to try it on. Without doubt, some major scandal will eventually be uncovered, leading to another tribunal - more millions down the drain.


Gene Kerrigan is my nominee the Politics.ie Cassandra award - the guy who told us what we did not pay a blind bit of notice to, until it was too late.

Now that the government has promised emergency funding for the ODCE everything will be fine.

[OK I made up that last bit]

Why Bertie's little sulk just doesn't add up - Analysis - Independent.ie
 


Gabha Óir

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I really wish I could remember who but someone was on radio at the time of that New York Times report and explained away the Wild West comment with a chuckle and how it was an indication of our vibrancy and energy.
 

Outlander

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I really wish I could remember who but someone was on radio at the time of that New York Times report and explained away the Wild West comment with a chuckle and how it was an indication of our vibrancy and energy.
All that'll be left of our Wild West will be the tumble-weed
 

Andrew49

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AndrewSB49
But along with its reputation for innovation, Dublin has become known in the insurance industry as something of the Wild West of European finance, a perception that helped prompt the creation of the Irish Financial Services Regulatory Authority two years ago. Despite its mandate for stricter oversight, the agency has yet to impose major sanctions on any Irish institution, even though Ireland has recently experienced several major banking scandals. But industry representatives dispute the idea that Ireland may be home to unchecked financial frauds.

NYT

Ireland - The Wild West of European finance

Taming the wild west - 2005
 

Lthse

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Mr Appleby has just 36 employees, including six gardai.

In 2006, they cautioned 900 company directors, examined 556 cases of questionable loans totalling €244m (that's when directors use a company as a piggy-bank). Around €160m was immediately paid back, and €48m in loans was referred to the Revenue for investigation.

There are now 680 directors restricted from company involvement, and over 1,600 have been disqualified. Among the most high profile of those currently in legal battle with Mr Appleby and his staff are the Bailey brothers, of Planning tribunal fame, welcome guests at the Fianna Fail fund-raising tent at the Galway Races.

The ODCE is currently chasing about 400 directors through the courts, while 130 individuals have been convicted. (I've no idea how many of them have experienced the delights of the Galway races.)
This is unbelievable, why isn't this guy on RTE every other week and quoted in the press with every scandal?

It looks like they don't want to touch him and upset the big golden circle in which they are fully complicit.
 

Gabha Óir

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I still wonder how Sur Anto has continued to employ Gene Kerrigan. Probably because he is the only scribbler in that domain who occasionally makes sense.

The beknighted one may have a Henry II moment yet

"What miserable drones and traitors have I nourished and brought up in my household, who let their lord be treated with such shameful contempt by a low-born cleric?"
 

Lao-Tse

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I still wonder how Sur Anto has continued to employ Gene Kerrigan. Probably because he is the only scribbler in that domain who occasionally makes sense.

The beknighted one may have a Henry II moment yet

"What miserable drones and traitors have I nourished and brought up in my household, who let their lord be treated with such shameful contempt by a low-born cleric?"
Now Hugh Leonard has passed away and Declan Lynch has
run out of creative, Kerrigan is the sole readable writer in
the Sindo.

Actually, wasn't Kerrigan in the Irish branch of Militant
years ago, or am I mixing him up with somebody else?
 

He3

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At the time Gene Kerrigan's piece was published in March 2007 the relevant office holders were Micheál Martin, who was the line Minister for the ODCE, in Enterprise Trade and Employment, Brian Cowen in Finance, and Bertie Ahern, Taoiseach. Brian Lenihan I think was in Justice, where he might have taken an interest in having an effective system of corporate law enforcement.

Edit: Willie O'Dea tells us on Saturday View that we must leave investigating all this to the (hobbled) ODCE. WOD has a GSOH.
 
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euroboy

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I remember that controvery.

You know, politicans like to say 'politics' isnt personal. But it is, the values that the leader has always tends to come through, the personal corruption, the incompetence, it all comes through.

Bertie, well he doesnt care. He can drink his brass and laugh at it all.
 

He3

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The government's hobbling of the corporate law enforcement body shows that the line from Lenihan about expecting Boards to take their responsibilities seriously does not apply to the Cabinet. They welsh on their responsibilities with impunity.

Instead we have to suffer that nauseating cant from the likes of O'Dea about the 'full rigours of the law'. Empty words from a busted flush.

John Gormley wants to see a 'perps walk' with the crooks in cuffs. The perps include the government TDs who stride out on the plinth of Leinster House to cod us a la Willie, and there's not a handcuff in sight.
 
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He3

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John Gormley tells Gerald Barry on This Week that Paul Appleby and his team will be given whatever powers they want. 'That's an absolute'.

Gerald Barry asks him if FF Cabinet members agree to this. 'You'll have to ask them'.

From an absolute to a contingency in the space of a single question.

And of course the problem is not with powers - it is with resources. So his fine-sounding statement was in fact carefully missing the point.
 
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constitutionus

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John Gormley tells Gerald Barry on This Week that Paul Appleby and his team will be given whatever powers they want. 'That's an absolute'.

Gerald Barry asks him if FF Cabinet members agree to this. 'You'll have to ask them'.

From an absolute to a contingency in the space of a single question.

And of course the problem is not with powers - it is with resources. So his fine-sounding statement was in fact carefully missing the point.

Im pretty sure i heard either him or a journo quoting him on the radio now asking for an external regulator to come in and sort this mess out.

looks like just maybe the seriousness of this has kicked in...


... or its another posturing exercise.
 

Eorna

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We have to remember as well, that the PD's were behind the de-regulation drive, and actively supported the Finance industry in creating the Wild West scenario we now have. They were a party that focussed on helping the top 1% of the electorate, while pretending to care about the top 10%. In time I believe the rot and corruption that permeates Fianna Fail, will be seen as endemic in the PD's as well, for all their piety.
 
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He3

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We have to remember as well, that the PD's were behind the de-regulation drive, and actively supported the Finance industry in creating the Wild West scenario we now have. They were a party that focussed on helping the top 1% of the electorate, while pretending to care about the top 10%. In time I believe the rot and corruption that permeates Fianna Fail, will be seen as endemic in the PD's as well, for all their piety.
Yes. The power of an idea whose time ought never have come.
 

HanleyS

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I commented on this earlier in the week. Paul Appleby has nothing like the resources at the disposal of the people he is investigating. Why would Bertie Ahern increase those resources when the very people the ODCE are investigating are the same people who frequented the Galway Races tents and contributed generously their time and money to the party.
 

He3

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Somebody might remind Brian Cowen of this problem identified by the ODCE now that he has taken up the torch for due process.
 

HanleyS

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Reverting to due process is a sure way of keeping your mates self. Look at how Bertie and Co ran rings around the tribunals and escaped punishment.
 

He3

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Between hobbling the ODCE and rejecting the Revenue recommendations that were intended to stymie the CFD system we can say that there has indeed been a lot done. It is actually hard to see what more could have been done. Yet they did find more to do - they hacked away the guts of the Freedom of Info law.

The controls we pay our government to design and implement for the protection of the people as a whole were well and truly kicked apart.

Now they 'call for' a world class regulatory system.

There is a word for all this I know...
 


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