Following decades of light-touch State regulation, the Law Reform Commission has adopted a degree of caution towards the prosecution of white-collar, corporate crime. Advocating the introduction of an offence of "reckless risk-taking" under false accounting rules, it rejected a recommendation from the Garda Síochána that favoured a broader "reckless trading" charge on the grounds that it might have "a chilling effect on entrepreneurial risk-taking".
A focus of the commission's report is the introduction of UK-style Deferred Prosecution Agreements. This approach would allow large companies continue to trade, provided they co-operated with the Director of Public Prosecutions and the High Court. Following a period of good behaviour, heavy fines would be imposed and public statements made identifying the extent of their wrongdoing. The process would not be available to company executives.
Whatever about the nature of such recommendations, the changes required to establish new agencies, confer additional powers on existing regulatory bodies, provide for new offences and create oversight structures will be extensive and cumbersome. But legislative reform is urgently required. As a former governor of the Central Bank, Patrick Honohan, remarked: "There will be another crisis, that's for sure. And it may not be in banking." Because of Brexit and other political pressures, however, time is likely to run out before this minority Government gets around to implementing the report's recommendations.
A new, properly resourced corporate crime agency should be established, the commission suggests, and it should work closely with a special unit within the office of the DPP. The commission recommends there should be greater co-operation between regulatory bodies and agencies dealing with white collar crime and it proposes the establishment of a single, overarching body along the lines of the Criminal Assets Bureau.
Following years of reckless risk-taking by senior banking executives, culminating in the financial collapse, the public’s appetite for retribution remains. The electorate may recognise the benefit of maintaining jobs through Deferred Prosecution Agreements, but criminal behaviour by executives will not be tolerated. It would be foolish to believe, as Prof Honohan said, that the next great corporate scandal will inevitably occur in banking.
Faced by a rapidly changing business world, preparations must be made to upgrade the law and establish an agency with forensic skills in this area. In the past, politicians tended to look the other way when the inadequacy of white-collar criminal law was exposed. On this occasion, even if the Government lacks the time and numbers to force change through the Dáil, it can surely prepare necessary legislation for its successor.