Rebuilding society - New fraud legislation is imperative
Wednesday, July 04, 2012
It is easy enough to talk about the idea of society, of collegiality, of collective responsibility, of a robust, positive national pride, even of a community-wide unity of purpose.
When this conversation continues after some too-big-to-fail buttress or other collapses the rallying cry that "we’re all in this together" is rattled out. Unfortunately it has become as untrue as it is patronising, as seditious as it is laughable. That shabby deceit has almost become The Fields of Athenry of our public conversation resonating with despair but laced through with the contempt of today’s Trevelyans for those they have defrauded.
Bob Diamond, who has resigned as chief executive of Barclays over the interest rate rigging scandal at the bank, is just the latest in a long — but not long enough — line of banking or regulatory premiership players to fall on their sword because they presided over a system that focused on profit so intently that there was no room left for scruples.
Barclays was fined a record €361m last week for attempting to manipulate interbank lending rates from 2005 to 2009. This scam imposed millions in extra costs on the bank’s customers and, in turn, on their customers. So great was the offence that British authorities have mooted criminal prosecutions. Only time will tell if this promise is a bone thrown to placate a snarling dog or a statement of intent. Neither has it been established who will fund the inevitable compensation packages but it is not reckless to suggest that Britain’s taxpayers will be invited to contribute.
It does seem though, and anyone who cares for this country must wince at this, that such ambitions have different prospects on different sides of the Irish Sea.
Like so many of our financial scandals Barclays’ followed a pattern. It began when the wrongdoing was uncovered to be quickly followed by the everyone-was-doing-it defence. Then, almost most tragically of all, it is established that the regulator knew about it but stood idly by not exercising his authority or grasping the scale of the disaster. And then there’s the cover up of the truth or assets put in jeopardy by the law’s inconvenient intrusion.
Last week we had an example of this evasive stonewalling when the efforts of Seán Quinn and his family to put assets worth about €500m beyond the reach of State-owned Anglo Irish Bank were aired in court. The posse dodging was to ensure that the Quinn family remain multi-millionaires while we repay their debts through tax hikes and public service cuts. In another strand of this scandal a High Court judge will rule today whether bankrupt Quinn may defend an action that could result in a judgement for more than €2.3bn against him.
While all of this is going on, while so many others in Ireland’s banking and business community who enjoyed leading roles in the Celtic Tiger days and collapse still enjoy the spoils of war, unemployment rates climb, more and more families struggle to make ends meet.
Those of us who still believe in the idea of society and the disciplines needed to sustain it can only wonder how Government can so vigorously crack the whip at budget time but prevaricate when it comes to legislation to confront the practices that earned for Ireland the shameful tag of the "wild west of European finance". If this society is ever to recover, if it is not to remain a hierarchy of the untouchables and the ignored, that legislation must be brought forward with a sense of great urgency, indignation and ruthless determination.