Monday 5 December 2016

Flavin made an honest mistake and deserves a second chance

Published 25/01/2010 | 05:00

Whether we like it or not, failure and mistakes are part of the business process. Many businesses will fail this year. Sometimes it will be the fault of the owners, who failed to take simple precautions, and sometimes it will be nobody's fault at all -- or just one of those things that happens from time to time. But society and the media must learn to give people a second chance if they fail for honest reasons.

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We need to distinguish when people deserve punishment and when they deserve a second chance and, more importantly, we must decipher how the punishment will fit the crime.

But there was little sign of this last week after the publication of the High Court inspector's report into DCC founder Jim Flavin's controversy with regard to insider share dealing. Many people reacted with horror to the report's findings, which essentially dismissed Mr Flavin's transgression as a costly and honest mistake.

The report was right on both counts.

It seems as clear as day that the case was a costly mistake; after all, DCC was forced to shell out north of €30m and Mr Flavin was forced to stand down from the company he founded and which gives 7,500 people a wage. His reputation was also left in shreds.

That is a hefty price to pay by any standard and only the most hard-hearted observer would deny that Mr Flavin has paid a high price for his actions. Short of a prison term, it is difficult to see what other meaningful sanction the authorities could impose on Mr Flavin.

The second finding was that the mistake was an honest one and that Mr Flavin and other DCC officials "each attempted to do what they understood to be right in all circumstances".

Anybody who has ever attempted to read the gobbledygook that is used in legislation such as the Companies Act, or indeed the Lisbon Treaty, can be excused for giving up and seeking legal advice.

This is precisely what Mr Flavin did and the fact the High Court agreed with that legal advice after 87 days of evidence tells us that at least one High Court judge agreed Mr Flavin was within his rights. We all take legal advice from time to time. Usually we say to ourselves that the highly paid advisers know more about the law than we do and simply follow their recommendations. It may not be ideal but that's the way the real world works.

The Government knows this. The gist of its Lisbon campaign was: "Trust us, we have read the treaty and understand it." Mr Flavin's mistake was to follow the same logic.

Given the relatively innocent nature of the transgression, the savage penalties imposed and the extent of serious white-collar crime in Ireland in recent years, it almost beggars belief that the Office for the Director of Corporate Enforcement chose to waste so much time and money pursuing Mr Flavin further. That Paul Appleby chose to go down this road is a worrying sign that some people are going to be crucified in the years ahead, while others escape all opprobrium.

We need to develop a better system -- a better court system, which does not involve five Supreme Court judges ruling on highly technical legislation and a better system of retribution, which tries a little harder to match the punishment to the crime in a proportionate manner.

Right now, Mr Flavin looks like a man who has been arrested by gardai and hauled before the courts for dropping a piece of litter on the pavement while the muggers at the other end of the street run riot.

Irish Independent

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