Irish white-collar criminals should be 'in handcuffs'

MINISTER FOR the Environment John Gormley said he wanted to see Irish white-collar criminals “led out in handcuffs” as happened in the US.

He predicted that the latest revelations about Irish Life Permanent and Anglo Irish Bank would result in resignations.

“There will be, and there must be, root-and-branch reform of our banking system. I believe we need a general crackdown on corporate crime in this country.

“In the United States you see people who are white-collar criminals led out in handcuffs. I want to see the same regime in this country, and I believe we will get the same regime in this country.”

Mr Gormley was speaking during the debate on a Government motion backing the recapitalisation terms relating to AIB and the Bank of Ireland.

Mr Gormley said there had to be closer bank supervision.

“We believe fervently that there must be changes in management at the top and a new attitude and philosophy must be applied. This will, by its nature, take time and planning. Moves are already afoot. The Green Party is in Government for bad times as well as good. The country faces an unprecedented recession amid the world’s worst ever economic downturn.”

Mr Gormley said a key aspect of the current malaise was an unstable banking system. People would not thank his party for shirking the challenges ahead.

“We are working inside the system to have current rules and procedures applied as fairly as possible in ordinary workers’ interests. We are working for longer-term change to ensure Ireland never again repeats these drastic errors.”

He said he wanted to stress the word “invest” when talking about the recapitalisation scheme. The aim was to reinforce the banking system, restore confidence and also boost lending to business to help support and created jobs.

Minister for Finance Brian Lenihan said the Government was of the view that significant reductions in the remuneration structures of banks was required.

“The banks benefiting from State capital, AIB and Bank of Ireland, accept that pay restraint is important in the overall context of the economy and the supports being provided by the taxpayer, and will act accordingly. As a step in this direction, they accept that the pay of senior executives will be curtailed.”

Mr Lenihan said the report of the Covered Institution Remuneration Oversight Committee (CIROC) was expected shortly. Its role was to consider the remuneration plans of each of the institutions covered by the Government guarantee.

He said he would be writing to the chairman of the committee, Eddie O’Sullivan, to ask him to examine whether an overall cap on executive remuneration could be introduced for the banking sector in the light of the significant State support now being provided.

Mr Lenihan said a priority for the Government had been to ensure that all intervention in the banking sector had as its ultimate goal benefiting and securing the position of the banks’ customers, including account holders, mortgage holders, businesses and entrepreneurs.

The Government motion was passed by 73 votes to 64.