A final bill introducing new rules that will hold top bankers and other senior finance executives in regulated companies individually accountable when their companies break the law will be released “as soon as possible,” according to Treasury Secretary Paschal Donohoe.
The new laws aim to convince the public that financial institutions are undergoing a “meaningful cultural shift”.
Confidence in banks was shaken after the Great Financial Crash, revealing glaring flaws within the institutions.
A draft of the Central Bank (Individuality Accountability Framework) Bill – a so-called general scheme – was published last summer. A key element of the new bill is the Senior Executive Accountability Regime (Sear).
Mr Donohoe said the new laws will “bring about positive culture changes, greater delegation of responsibilities and improved accountability, while simplifying the imposition of sanctions on individuals who fail in their role in the financial sector”. He responded last week in a written response to a parliamentary question tabled by Sinn Féin TD, Sorca Clarke.
The program for the government has committed to introducing Sear to achieve “enhanced accountability” in the banking sector.
Mr Donohoe said his officials are currently working closely with the Office of Parliamentary Adviser on drafting the bill. He said the process is at an “advanced stage”.
He warned that the bill is a “complex piece of legislation” and will need “extensive adjustments” to reflect a landmark Supreme Court decision last year.
This case was taken over by Tomasz Zalewski who claimed he was wrongfully dismissed from Buywise Discount Stores.
He claimed that a section of the Workplace Relations Act 2015 was unconstitutional because it meant that trials heard before an Adjudication Officer could not be held in public and that there was no provision for testimony under oath.
The Supreme Court found that there is no reason why there shouldn’t be public hearings before an adjudication officer.
It also held that the absence of an oath or punishment for making false testimonies, while not unconstitutional, was inconsistent with the Constitution.
Mr Donohoe said the general scheme of the bill is currently under pre-legislative consideration by the Oireachtas Joint Committee on Finance, Public Expenditure and Public Reform.
“The Taoiseach and I are waiting for the committee’s report, which I hope to see soon,” he said.
Mr Donohoe said the new laws would ensure there was “absolute clarity” about “who is responsible for what” in financial institutions.
“This should foster a culture of personal accountability across the sector,” he stressed.
“Restoring public confidence in the financial sector is vital, not least for the sector itself,” added Mr. Donohoe.
“The goal of this regime is to assign responsibility and prevent offenses rather than punish.
“This framework aims to improve governance and management of risks and outcomes for consumers.”
https://www.independent.ie/business/irish/law-to-make-top-bankers-individually-responsible-when-companies-act-illegally-due-soon-says-paschal-donohoe-41517440.html Law to hold top bankers individually liable if companies act illegally “soon,” says Paschal Donohoe