Anti-corruption unit needed to crack down on multi-million euro money laundering

High-profile cases of dirty money being laundered through Ireland’s international financial services likely to be 'the tip of an iceberg',  anti-corruption body says

Multi-million-euro cases of foreign dirty money being laundered through Ireland’s international financial services are likely to be 'the tip of an iceberg'.

High-profile and multi-million-euro cases of foreign dirty money being laundered through Ireland’s international financial services are likely to be “the tip of an iceberg”, an anti-corruption body said.

In a new report, Transparency International (TI) Ireland called for the establishment of a national anti-corruption bureau, the banning of concealed investment structures and additional resources for the Garda National Economic Crime Bureau.

The report, Safe Haven? Targeting the Proceeds of Foreign Corruption in Ireland, follows a number of relatively recent court cases involving the laundering of bribes and embezzled State assets through funds managed in Irish-based banks and insurance funds.

These include: 

• In summer 2015, US authorities brought proceedings to freeze between $100m and $300m of corrupt payments from Uzbekistan through funds managed by Bank of New York Mellon in Dublin. The funds were held on behalf of companies owned by Gulnara Karimova, the daughter of former Uzbek president Islam Karimov. The case is ongoing;
• In August 2020, the Government announced it had reached an agreement with the Nigerian government to return about €5.5m. This followed a case taken in 2014, in which the Criminal Assets Bureau obtained a proceeds of crime order to freeze US$6.5m worth of investments, managed by HSBC Life (Europe) Ltd. They were held for the benefit of Mohammed Sani Abacha – the son of former Nigerian president and dictator Sani Abach;
• In 2014, CAB obtained a proceeds of crime order to freeze assets linked to alleged corruption on the part of the former governor of the Tourism Authority of Thailand, Juthamas Siriwan. Ms Siriwan was accused of receiving kickbacks to award the Bangkok International Film Festival to a US company. The frozen funds, worth €250,000, were held in investments by HSBC Life (Europe) Ltd in the name of the former governor and her daughter. 

“I think these cases are likely to represent the tip of an iceberg,” said John McDevitt, chief executive of TI Ireland and report editor.

“When you consider that Ireland is a major player in international financial services, hosting 250 of the world’s leading financial services companies, with €2.8trn in net assets in funds domiciled in the country, the risk that many of these assets are the proceeds of corruption is extremely high.” 

The report raised concerns about particular forms of investment in the country – Special Purpose Vehicles (which include Section 110 companies used to avoid tax on investments) and Ireland’s immigrant investor ‘Golden Visa’ programme (which allows wealthy foreigners to secure residency visa in return for €1m minimum investment).

TI Ireland also flagged concerns about the potential use of new investment liability partnerships which do not currently have to file beneficial ownership details. 

It said similar schemes had been used to launder the proceeds of corruption and organised crime “on an industrial scale”.