Banking scandals - Protect those who expose fraud

The report that Allied Irish Banks has employed the British-based organisation Public Concern at Work to protect whistleblowing employees is an indictment of the Government’s failure to protect Irish people.

Has our much vaunted independence come to this, that Irish people must look to a British organisation for protection?

In recent years AIB's involvement in a whole series of scandals has been exposed. It was ripping off the State and its own customers. It has given a new meaning to the term bank robbery. AIB defrauded the Revenue by facilitating income tax evasion and engaging in evasion of DIRT through bogus non-resident accounts. As a result the bank had to pay the Revenue Commissioners €114 million, the largest payment of its kind in the history of the State.

This year there were further exposures of AIB ripping-off €25m by overcharging foreign exchange customers. Before that there was the disclosures of abuse in relation to investment products for the elderly and other vulnerable groups, and charging mortgage customs for loan protection, even though they had not requested such insurance. The bank also admitted overcharging customers who held trusts before 1971.

"Banking institutions are more dangerous to our liberties than standing armies," warned Thomas Jefferson, author of the American Declaration of Independence. AIB lost around €691m in the Rusnak Affair that was exposed a couple of years ago. Fears that the country's whole banking system would be undermined, prompted the Government to come to AIB's rescue in 1984 over the Insurance Corporation of Ireland scandal.

Most of the scandals have been uncovered as a result of whistleblowing from within the bank, but there is little statutory protection for the whistleblowers. Pat Rabbitte introduced a Whistleblowers Protection Bill in the Dáil in 1999. It passed its first two stages, but it has been sidelined since then.

The Government contended that the bill needed further consideration, lest it "become a crank's charter" in the words of Minister of State Tom Kitt. Minister Martin Cullen echoed those sentiments at the time. AIB is funding what it calls the 'Speak Up' programme training management to set up procedures that would allow staff to raise matters without fear of reprisals. This smacks of a public relations gimmick.

The economic threat posed by irresponsible banking has already been well illustrated. The Irish people have been lucky that the fallout has not been much worse. The country is currently plagued by tribunals without inviting the necessity for a banking tribunal.

The Whistleblowers Protection Bill is still supposedly on the Government's agenda, but five years have elapsed since the legislation passed the second stage in the Dáil. That has been more than enough time to iron out any difficulties.

There must be some kind of Public Interest Disclosure legislation to protect whistleblowers. This should apply to all facets of commercial life, not just the shenanigans of AIB, or the banks in general. It should be a fundamental rule of an ordered society that anybody who serves the public interest deserves, in the national interest, to be protected from victimisation.