The Revenue Commissioners will this week begin examining the High Court report on National Irish Bank (NIB) to see whether it will seek to initiate criminal proceedings against any executives for assisting NIB customers to engage in tax evasion.
They will consider whether to initiate the State's first prosecution for aiding and abetting tax evasion, which would be a major step for the Revenue as it would set down a marker for other professionals who advise on tax affairs.
Separately, it has been learned that the Garda investigated NIB in the late 1990s for overcharging interest and fees, after the allegations in this area first emerged. It was not possible to establish what the outcome of the Garda investigation had been and whether a file had been forwarded to the DPP on foot of the Garda investigation in this area.
On the tax issue, Revenue Commissioners chairman, Mr Frank Daly, has previously stated that securing a conviction for aiding and abetting tax evasion, rather than just straightforward tax evasion, would be "good for Revenue and good for the country".
A Revenue spokesman last night cautioned that prosecuting such cases would prove difficult because the burden of proof was so high. He said the report by the two High Court inspectors would be studied in detail by staff at the Revenue's investigations and prosecution division in Ashtown in Dublin.
On several occasions, Mr Daly has referred to the difficulty of securing convictions on aiding and abetting. He has pointed out that evidence needs to be produced showing the accused knowingly instructed another person to evade tax.
The Revenue is currently considering asking for a change in the law to make it easier to pursue banks and financial advisers for aiding and abetting tax evaders, but this is unlikely to apply retrospectively.
Mr Daly told the Dáil Committee of Public Accounts (PAC) last month that the Commissioners "would love" to be able to take an aiding and abetting charge in relation to tax evasion. Mr Daly said he would not disagree that advice had been given by a third parties in many cases of tax evasion.
The situation was further complicated, he said, by the need for the tax evader's co-operation in pursuing a particular conviction.
Proving the more common charge of tax evasion has proved difficult enough, although the Revenue has successfully prosecuted three holders of NIB/CMI bonds in recent years. Two people were fined resulting from these prosecutions and one person received a suspended sentence. The Revenue has collected €51 million to date arising from all investigations into NIB.
Even if the Revenue finds enough evidence to put together a case against someone for aiding and abetting tax evasion, the ultimate decision to initiate a prosecution rests with the Director of Public Prosecutions (DPP)
Meanwhile NIB confirmed last night that the practice of overcharging interest and fees on individual accounts was the subject of a Garda investigation in the late-1990s.
However, NIB has said it has no knowledge of an alleged Garda investigation into bogus non-resident accounts referred to in Sunday newspaper reports. The reports suggested the Garda Bureau of Fraud Investigation had sent a file to the DPP on the operation of bogus non-resident accounts at NIB. A Garda spokesman declined to comment on the reports.
