Ireland - Corruption
Corruption is not a serious problem for foreign investors in Ireland. The principal Irish legislation relating to anti-bribery and corruption includes the Public Bodies Corrupt Practices Act 1889, the Prevention of Corruption Act 1906, the Prevention of Corruption Act 1916, and the Prevention of Corruption (Amendment) Act 2001. This body of law makes it illegal for Irish public servants to accept bribes. The Ethics in Public Office Act 1995 provides for the written annual disclosure of interests of people holding public office or employment.
The law on corruption in Ireland was strengthened following the enactment of the Prevention of Corruption (Amendment) Act, 2001, which gave effect in domestic law to the OECD Convention and two other conventions concerning criminal corruption and corruption involving officials of the European Communities and officials of EU member states. The legislation has ensured that there are strong penalties in place, of up to 10 years imprisonment and an unlimited fine, for those found guilty of offences under the Act, including convictions of bribery of foreign public officials by Irish nationals and companies. Ireland signed the UN Convention on Corruption in December 2003, and ratification is pending a review of the legal measures required for implementation.
The Irish police investigate allegations of corruption. If sufficient evidence of criminal activity is found, the Director of Public Prosecutions prepares a file for prosecution. A small number of public officials have been convicted of corruption and/or bribery in the past, although it is not a common occurrence.
Charles J. Haughey became a Fianna Fail Party MP in 1957 and held a number of ministerial positions in the 1960s including Justice, Agriculture, and Education. He was dismissed as Finance Minister in 1970 for alleged smuggling of arms to the Irish Republican Army (IRA) in Northern Ireland although he was later cleared of all charges. His political career later recovered and he became Minster of Health and Social Welfare (1977-79) and Prime Minister (1979-81, 1982, 1987-92). He resigned as Prime Minister in 1992 after financial and wiretapping scandals and rumors of corruption haunted him all his life. After leaving political office he paid taxes and fines of euro 5 million and was indicted on charges of obstructing justice.
In 2006, the Moriarty Tribunal found that former Prime Minister Charles Haughey had accepted the equivalent of roughly euro 12 million in payments between 1979 and 1996 in return for political favors, such as tax reductions for associates and the procurement of a passport. Haughey died in 2006. Haughey remained a figure much loved by some and seen by others as emblematic of corruption in Irish politics.
Allegations of political corruption related to property development schemes, tax avoidance by business and political leaders, as well as other scandals dating back to the late 1980s and early 1990s surfaced in 2000. The Dail has established two tribunals -- the Flood Tribunal and the Moriarty Tribunal -- to investigate these various scandals, and the work of the two tribunals continued until 2001. Although several senior political leaders and members of parliament were named in connection with the scandals, the government of Prime Minister Ahern remained stable, and most observers thought it unlikely new general elections would be held before spring 2001. The May 2002 national elections returned Fianna Fail and its coalition partner, the Progressive Democrats, to power.
In 2006, the Irish media disclosed information leaked from the Mahon Tribunal that Prime Minister (Taoiseach) Bertie Ahern had, as Finance Minister in the 1990s, accepted the equivalent of roughly euro 50,000 in loans from associates. Following the disclosure, the Prime Minister made public statements about the incident, noting that his actions had not been illegal and that political favors had been neither sought nor granted in connection with the loans.
Persistent allegations of irregular financial affairs in the early 1990s, which publicly dogged Irish Prime Minister Bertie Ahern for more than a year, flared into the public spotlight in September 2007. The Mahon Tribunal, created to inquire into allegations of corruption in the granting planning permission while Ahern was Minister for Finance, resumed sitting on May 28. The Tribunal judges had suspended hearings in the run-up to the May 2007 national elections, which Ahern and his Fianna Fail party handily won. Prompted by the allegations of corruption, Fine Gael, the largest opposition party, tabled a motion of no confidence in Ahern in the Parliament (Dail Eireann) on September 26. Ahern, supported by his Fianna Fail party and coalition partners (the Green Party and the Progressive Democrats) easily beat back the vote, 81 to 76.
Prime Minister Ahern resigned in May 2008, stating, in part, that the Mahon Tribunal investigation was distracting the government from its business. Damaging recent testimony by his former private secretary stated that payments into his personal bank accounts in the early 1990s were made in British pounds rather than Irish punts; a fact Ahern had strenuously denied in Tribunal testimony. An article in The Irish Times on March 29 noted that Ahern's transactions under scrutiny by the Tribunal totaled 452,800 British pounds.
The banking sector was rocked by scandals, with accusations of cronyism and outright corruption between banks, investors and politicians. On 20 February 2009, Anglo-Irish Bank revealed that it lent 10 customers (nicknamed "the golden circle" in Ireland) Euro 451 million to purchase Anglo-Irish shares, with 75 percent of the loans secured by the shares and 25 percent secured by the participants' "personal assets." Justice Minister Dermot Ahern said, "legislation is in place to bring to justice those who may have played hard and fast with the financial security of this country." He continued, "we operate the rule of law. As far as I am concerned, that provides that, whether you have a balaclava, a sawed-off shotgun or a white collar and designer suit, the same rules apply."
A number of ongoing judicial tribunals sought to establish whether political donations by certain Irish companies in the late 1980s and early 1990s can be linked to favorable government decisions, mostly at the local level, in zoning and tax matters. There was also media and public concern that business interests may have compromised Irish politics in the late 1980s and early 1990s. Despite these reports of payments to political parties and figures in the 1980s and early 1990s, there remained no indication that foreign businesses or investors had to make such payments or been approached to make such payments to conduct business during the period in question or in years since.
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