Honouring the corrupt

It’s been a long and beautifully warm summer but the corruption, incompetence and general shenanigans that blights Irish political, social, and business life never ceases.

Last weekend we had the annual farce down in Dingle. The committee that organizes the annual Dingle Regatta continues to centre the event around the notorious tax cheat, Charles Haughey.

The strongly pro Fianna Fail committee labour under the delusion that Haughey was singularly responsible for the development of Dingle. The reality is, of course, very different.

Much of the development in Dingle took place during the 80s. This was a decade when compliant taxpayers were paying over 50% of their wages in tax while corrupt and shady characters like Haughey were busily robbing the State.

This idolization of a cheat and liar, a man who betrayed his family, friends, party and country can only be described as bizarre.

Rampant corruption – rampant profits

The latest profit figures announced by Allied Irish Banks put into perspective the pathetic powers of Ifrsa, the so called Irish Financial Regulator. Allied Irish Banks, Ireland’s biggest bank, saw its profits before tax reach an average of €9.5m per day as overall pre-tax profit levels reached €1.2 billion.

A maximum fine of €5 million can be imposed on an errant financial institution. This represents about 4 hours profit at AIB. Up to €500,000 can be imposed on an individual which represents about 15 minutes profit at perhaps one of the most corrupt banks in Ireland.

Of course, fines have never been imposed on any Irish financial institution despite revelations of massive theft, tax evasion and other illegal activities in recent years. The only requirement imposed by the toothless Irish regulator is that monies stolen or ‘overcharged’ must be paid back.

Irish Financial Regulator – Bizarre and toothless

Utterly bizarre is the only appropriate description for the title of the Irish Financial Regulator’s 2006 annual report. The report, published last week, is entitled

‘Protecting Consumers Through Effective Regulation’.

Clearly, someone within this secretive organisation has an ironic sense of humour because protecting consumers is not, and never has been a priority for this so called regulator. Indeed, it seems to have only one policy and that is to protect at all costs the interests of the rampantly corrupt Irish financial sector. As most Irish consumers know to their great cost there is any number of financial institutions out there who would put the mafia to shame in their ability to rob customers.

Yet, since its establishment in May 2003, this toothless tiger has failed to take action against even one of these dodgy organizations. According to the regulator’s consumer director, Mary O’Dea ‘Ifsra wants to work with the industry to prevent further errors’. In fact, it is reasonable to assert that the so called financial regulator actually protects and encourages ‘wrongdoing’ within the financial sector. It does this in three principal ways.

1. Language: The regulator never uses words like ‘theft’ ‘crime’ or ‘corruption’. It only uses words/phrases like -‘Procedural errors’, ‘acted wrongly’, ‘improper charging’, ‘overcharged’, ‘breakdown in procedures’, ‘billing mistakes’.

Words and how they are delivered are important in understanding what a person/organisation means and can send a powerful message to the listener/reader. The message from the Irish financial regulator is –

These are not really crimes so we don’t need to take any real action.

The message the corrupt institutions take from this is –

No crime, no punishment – great, let’s get working on the next scam.

The message for the consumer is –

No regulation, no justice, no hope.

2. Refusal to use its powers of sanction: The regulator can impose fines of up to €5million on a company and €500,000 on an individual for ‘improper behaviour’. It has never done so; neither have any of its predecessors. In fact, no punishment has ever been meted out to errant institutions by any so called Irish financial regulator since the foundation of the state in 1922. The message here needs no further analysis.

3. Secrecy: This is the most powerful weapon the Irish regulator posses for its defence of corruption in the financial sector. It is the official policy of the Irish regulator to keep secret the names of all firms found guilty of ‘overcharging’ their customers. This policy protects the guilty and obviously puts consumers at a serious disadvantage.

Let’s just examine this year’s corrupt activities. According to the regulators annual report 36 different institutions ‘overcharged’ customers by over €50 million between May 2005 and May 2006 – Yes, that’s right, €50 million and this is referred to as ‘Procedural errors’.

From past experience it is reasonable to assume that much of this €50 million was stolen rather than accidentally ‘overcharged’. Irish citizens, however, will never know what companies are plundering their accounts because the regulator has decided that their identities will remain a State secret.

Neither will any of these institutions face the inconvenience of a police investigation as they effectively operate outside the law of the land. The regulator is the only ‘authority’ that can impose any restraint on their corrupt activities and to date he has refused to do so.