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Thomas Pringle TD – Money Laundering; Target The Banks Too!
- Updated: 24th September 2020
As with everything in society, money makes the world go around and that is certainly true for those who use illicit funds to support their activities. Along with other legislation that preceded it, the Bill aims to make the activities of illegal organisations more difficult. For that reason I support the Bill. The reasons have been outlined by many Members tonight about what is actually happening with targeting individuals involved in criminal activities such as drug dealing. We need to look further than that with this Bill.
The Bill provides for several possibilities in managing and looking at transactions from particular countries that might attract attention, which is appropriate. It also defines more closely who a politically exposed person is and the need to maintain a register of them. In the Irish context I thought these politically exposed people were individuals who might abuse their office to hide money, as we are well used to here in Ireland. However, it seems that it is more to highlight individuals who, perhaps through their job, have a role in detecting money laundering or being targeted by money launderers to be in that role. There may be a need for a second register of political people who might deal in money laundering themselves as well, which would be no harm.
Interestingly what caught my attention was the introduction to the Bill by the Oireachtas Library and Research Service, which did a great job on this Bill as it does all the time. It stated that the Bill softens the requirement to examine the background and purpose of a transaction, by qualifying that this only needs to be done as far as is reasonably possible. This led me to wonder why this would be the case.
I looked at what happens with this and who launders funds. The financial system, of course, must be protected at all costs. There is no doubt, possibly, that the financial institutions do not actually launder funds themselves or set up funds for laundering, possibly, but they are all laundered through banks and financial institutions. The crux of the issue is that the banks and financial institutions allow for the money laundering and facilitate it. Everything that it does they do. Therefore, the banks must have knowledge of where the money laundering is happening and how it is happening, but it is not done to them.
The amounts of money involved are staggering which gets to the crux of the issue of why the banks are not touched in this regard. The amounts are mind boggling. The US Financial Crimes Enforcement Network showed that in 2017, $2 trillion – I do not even know how many zeros are in $2 trillion – in suspicious transactions are reported globally by banks. Its files show that important institutions such as Deutsche Bank and HSBC Holdings plc, which we know well here, continue to facilitate suspicious transactions despite having been fined for doing that. The value of the fines is insignificant compared with the amount of money they get access to and can move through their transactions.
As an interesting aside, Deutsche Bank is also the main banker for the President of America. That may give some indication about how reputable Deutsche Bank is. It has been reported that $1.3 trillion of that $2 trillion has been moved through Deutsche Bank, which is very significant.
Surely the way to tackle money laundering is centrally based in the banking system, but there seems to be little appetite to move against them and target the banking system. There have been no prosecutions within institutions. Sadly that does not surprise me because official Ireland places banks at a high level well above citizens and, of course, only citizens commit crimes, not institutions and financial organisations. We need to get to the heart of that and change that responsibility. We need to make the banks responsible for their actions.
They are not innocent bystanders in this. It is not that somebody happens to lodge $1 billion or €1 billion in an account and the bank does not know anything about it. The banks know where the money comes from, but they choose not to tell. The financial system, the government system and the whole system choose to turn a blind eye. We will target the drug dealers and the people who are hassling youngsters and getting them to do transactions through their accounts. They will get publicity over prosecutions for that. Meanwhile the banks will continue what they are doing in facilitating money laundering on a mass scale that would make our eyes water. Sadly Dublin is probably a very important cog in that wheel to allow that to happen in Irish financial transactions. That is possibly why we will never question it seriously and look at what causes the problems.
If we are serious about this, we need to tackle the banks and make them responsible for it. The fact that there have been no prosecutions under any regulations for financial irregularities in this country shows where we place this.
