The State's corporate watchdog is expected a surge in corporate insolvencies and complaints of financial wrongdoing this year after the Covid pandemic saw a dramatic fall in such incidents last year.
Publishing its annual report the Office of the Director of Corporate Enforcement (ODCE) said liquidator reports received during 2020 were down almost a quarter on 2019 levels with auditors’ indictable offence reports and complaints from members of the public also down substantially on 2019 levels – 29% and 41% respectively.
The Director Ian Drennan said the substantial fall-off reflects a number of factors including the underlying downward trend in insolvent liquidations in recent years and the impact of public health restrictions on liquidators’ ability to discharge their functions.
However, with the economy reopening he said it was reasonable to anticipate that 2021 will see a reversal of that trend and that such incidents could return to pre Covid levels or worse.
"There is, however, a view that current State supports are masking true levels of corporate financial distress," Mr Drennan said.
"If this is the case, as the longer-term effects of Covid permeate the economy and the various State financial supports taper off, it might reasonably be expected that the level of corporate insolvencies will increase, potentially substantially."
In relation to enforcement activities last year the ODCE submitted files to the Director of Public Prosecutions in relation to four separate investigations. The Director issued directions to charge individuals in respect of three separate investigations.
A total of 45 criminal charges were brought against five separate individuals in relation to a range of offences including money laundering, fraudulent trading, theft, providing false information and contravening a restriction order.
Following the ODCE’s examination of almost 700 liquidators’ reports, 61 company directors were either restricted or disqualified as a consequence of their behaviour as directors of insolvent companies. A further 18 company directors were disqualified arising from ODCE investigations into companies that had been allowed by their directors to be struck off the Register of Companies for the failure to file statutory returns with the Registrar whilst having significant outstanding debts.