The first prosecutions under the new anti-money laundering and anti-terrorism laws have been aimed at bogus companies, first uncovered by an Irish independent inquiry last year.
Details of the successful criminal prosecution only became generally known today after inquiries from the Federal Court of Justice Irish Independent in this week.
Five companies – four of them front companies – were convicted in separate cases in Dublin Metropolitan District Court at the end of June for failing to provide the required ownership information on the Register of Beneficial Owners.
The Mandatory Register of Beneficial Ownership (RBO) was set up under the EU’s fourth Money Laundering Directive, commonly known as MLD4. It aims to prevent money laundering and terrorist financing by companies.
All companies and corporations must register beneficial ownership information of the companies, otherwise they risk criminal prosecution.
Minutes from a Companies Registration Office (CRO) stakeholder meeting last month show that members have been briefed on the first law enforcement actions under the legislation.
But the transcript doesn’t mention details of the five companies or indictments.
Following inquiries from this newspaper yesterday, the Department for Enterprise, Trade and Employment – which oversees the CRO and the RBO – confirmed the details of the five companies that were fined.
The charges were against Qianeruia Ltd, Zeretiuar Ltd, Yunanera Ltd and Cshunyuan Ltd, all with Dublin registered addresses but with dubious details filed with the Companies Office.
The four come from a tsunami of fake companies registered in Ireland and debunked by one Irish Independent probe last year. Experts have warned that such firms could be used to commit criminal activities around the world, including evading sanctions.
The fifth company to be prosecuted was a trading company, Liberty Barber of Meath Street, Dublin. It is a trading company with real operations in Ireland.
Hundreds of fake companies uncovered by this newspaper almost always match a basic template with paperwork listing one director in China and another allegedly based in a country in mainland Europe or Ireland. Previous research by Irish Independent determined that these European and Irish directorships were either false or used stolen identities.
Many of the fake companies used the addresses of legitimate companies without the legitimate companies’ knowledge.
That Irish Independent Inquiries led to the CRO being dragged before the Oireachtas Joint Committee on Enterprise, Trade and Employment last year.
The CRO and the Department of Enterprise, Trade and Employment – headed by Tánaiste Leo Varadkar – had insisted there was “no basis” to believe the bogus companies were actually fake.
That Irish Independent has found that companies whose data is all or almost all false are still registered with the CRO, although the organization said last year it had sought to step up so-called integrity checking to identify such front companies.
Last year a Dublin businessman complained to the Office of the Director of Corporate Enforcement (ODCE) about his being appointed director of a number of fraudulent companies in Ireland without his knowledge or permission.
A number of other law-abiding businessmen were also forced to petition the CRO to remove them as directors of shell companies for which they had been appointed directors without their knowledge or permission.
Failure to submit beneficial ownership information to the RBO can result in companies and corporations being fined €5,000 on summary conviction and up to €500,000 on indictment.
Each of the four bogus companies successfully prosecuted in June was fined 3,000 euros.
The CRO stakeholder meeting was also told last month that four other companies have pleaded guilty and the probation law has been applied.
However, the ministry confirmed yesterday that only two companies actually had the probation law applied to their cases. One case has been closed and another is pending.
The CRO Stakeholder Meeting was advised last week that further law enforcement action will be taken for non-compliance with RBO Requirements are expected in the fall.
But the ministry confirmed yesterday that no companies are currently being prosecuted.
https://www.independent.ie/business/regulators-take-criminal-cases-against-rogue-firm-operators-41921731.html Regulatory authorities are conducting criminal proceedings against fraudulent company operators