Sunday 15 September 2019

'Bankers hide their wrongdoings, we want to make individuals accountable'

 

Gerry Cross: Regulator says management tries to insulate and remove itself
Gerry Cross: Regulator says management tries to insulate and remove itself
Charlie Weston

Charlie Weston

Laws must be introduced to prevent bankers hiding wrongdoing, the Central Bank has told an Oireachtas committee.

Regulators want to hold bankers individually responsible for the type of dishonesty that led to the tracker scandal.

The proposed legislation would stop senior managers in financial firms trying to cover up their dishonest actions by claiming the firm acted collectively.

It would set out exactly who is responsible for various duties within a bank, and force them to adhere to certain conduct standards.

Director of Financial Regulation, Policy and Risk Gerry Cross told the Oireachtas Finance Committee there was a need for "an individual accountability framework".

"We recommended the introduction of an enhanced individual accountability framework, key components of which would apply to all regulated financial services providers," he said.

He told how managers sometimes try to cover up their actions.

"Management in regulated entities may seek to insulate themselves, or be at a remove, from apparent misconduct," he said. "Senior individuals can seek to escape liability for wrongdoing by hiding behind the collective.

"This experience is directly relevant to our proposals for an individual accountability framework."

He added that there was a need for a simplified approach to enforcement.

The legislation has been delayed because of Brexit preparations, Finance Minister Paschal has said.

He told the Dáil on Tuesday he had wanted to seek Government approval to draft heads of the bill by the end of March, but said: "My officials involved in this area have also been involved in all the issues in the Brexit Omnibus Bill."

Mr Donohoe said he plans to seek Government approval for the Central Bank (Amendment) Bill "well in advance of the summer" and to debate the legislation after the summer recess.

Irish Independent

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