Cassandra Voices

Tag: Ger Deering

  • Judge the Strength of a Democracy by its Treatment of Whistleblowers

    In light of recent developments, not least, the announcement of Michael McGrath as the next EU Commissioner, it is timely to look again at the infernal plight of workers of conscience – those noble people who blow the whistle on wrongdoing, and who strive to keep a corroded system from descending further into the abyss.

    Until 2022, Michael McGrath was Minister for Public Expenditure, National Development Plan Delivery and Reform (referred to henceforth as DPER). Under his Ministry, new EU protected disclosures legislation of 2014 was advancing, and also EU Directive number 2019/1937 of the European Parliament and of the Council of Europe of 23 October 2019 was set to be transposed into Irish law.

    The provisions of this Directive give significant further protection to persons who expose breaches in EU law as provided for in the Irish Protected Disclosure Amendment Act 2014. The aforementioned EU Directive was only finally transposed into Irish law in January 2023 and the new Act became known as The Protected Disclosure Amendment Act 2022.

    This provision was, however, effectively sabotaged long before it was transposed, and Minister Michael McGrath was central to that. The entire Protected Disclosure Act is under the remit of DPER.

    Cynical Collusion

    The now sinister OPLA – Office of the Parliamentary Legal Advisor was exposed on these pages before in November 2022 and again in March 2023. Its rapid expansion appears to have been in anticipation of the significant effectiveness of this EU Resolution on Protected Disclosures to stem corruption and protect whistleblowers. Two things happened to neutralise and sabotage this EU provision before it was transposed:

    • The vast expansion of OPLA involved OPLA being placed, unconstitutionally, on the statute books in December 2018, just as the Dail was rising for its Christmas recess. It occurred with no committee stages, or debate. This was in defiance of the Dunning Capacity Report, into OPLA which was not sent back to the sub-committee on Dail reform for consideration in December 2016 by the Dail Clerk who received it from Dunning. Thus, Dunning’s report was effectively suppressed. The integration of the OPLA into the Houses of the Oireachtas as rank-and-file civil servants, under the Dail clerk (a civil service appointee) in the Executive Arm of Government, is, as pointed out, a violation of the constitutional Separation of Powers. The discovery that OPLA was secretly involved in the investigation of Protected Disclosures in defiance of the provisions of the Act since 2013, and that it was all set to escalate as per Dunning, exposes a sleight-of-hand to virtually cut the legs out from under whistleblowers, striking a lethal blow at an integral part of democracy. 
    • The unlawful appointment of the Ombudsman by the civil service body – the PAS (Public Appointment Service) – is a violation of the Ombudsman’s Act 1980, and subsequent amending acts. The Ombudsman Act specifically disallows the Ombudsman from being appointed by the civil service. The Ombudsman was also appointed as Commissioner for Protected Disclosures, another canny moved within DPER while Michael McGrath was Minister. The Ombudsman knew full well that the OPLA – since 2018 a civil service body – was already involved in the investigation of Protected Disclosures since 2013, and that this was considered the main area of “growth and challenge for OPLA.”

    I have been in email contact with the CEO of the PAS about this unlawful appointment of the Ombudsman. I accused her of stepping outside of her remit in the appointment of the Ombudsman and pointed out that the Ombudsman’s Act 1980 specifically excluded it as a civil service appointment. To this she replied that it was done by PAS as “sanctioned” by the then Minister, Michael McGrath.

    He has no power to unilaterally alter legislation. The competition for the Ombudsman’s job was held by the PAS in August 2021, when the Dail was in recess and during the holiday season. The only Irish applicant was Ger Deering. On the appointment board was David Moloney, SG in DPER who was central to the entire legislation, as it was progressing at Committee stages in the new Protected Disclosures Act. David Moloney merely continued what Robert Watt, whom he replaced, had commenced.

    Both David Moloney and the Ombudsman appeared before the Finance Committee, which was responsible for the deliberations into the Protected Disclosures legislation, and which met several times in 2021 and 2022 to discuss the enhanced the Protected Disclosure Bill 2014, and the EU Directive about to be transposed.

    David Moloney effectively misled the Finance Committee in failing to inform the Chair and members that the PAS, with the apparent collusion of Minister Michael McGrath, after unlawfully taking over the appointment of the Ombudsman, whom it was also decided would become the new Commissioner for Protected Disclosures.

    Ger Deering’s appointment is a Constitutional one, and it thereby had to be ratified by the Dail before he went to the Aras to get his seal of office from the President. Mr Deering appeared before the Finnance Committee and made a speech on his appointment in December 2021 for the purpose of his appointment being ratified by the Oireachtas.

    I contend that Deering also misled the Committee, whose members and Chairman seemed to have been unaware that the Ombudsman should not have been appointed by the civil service body – the PAS – by law. Deering knew that he would be using the unconstitutional OPLA as new Commissioner for investigating Protected Disclosures, but he never revealed that at the Finance Committee despite the fact that John McGuinness, the Committee’s chairman, discussed the plight of whistleblowers with him fairly extensively and name checked a number of better known ones.

    McGuinness and his committee approved Deering’s appointment on behalf of the Oireachtas and he duly went to the Aras to receive his seal of office from the President.

    Whistleblowers – The Walking Wounded

    The dual strategies of the newly expanded OPLA – an unconstitutional entity since 2018 – and the sabotage implicit in the appointment of the Ombudsman utterly neutralised the provision of the EU Directive on Protected Disclosures, even before the full transposal of the EU Directive in January 2023.

    It was all done by DPER under Michael McGrath as Minister. The senior civil service have dealt a mortal blow to democracy, with full ministerial collusion and, above all, have commenced the ongoing campaign against whistleblowers – the walking wounded in a deeply corrupt system.

    In 2022, at a meeting of the Finance Committee, which McGrath attended with his senior civil servants, including David Moloney, and where a number of whistleblowers were also present, the civil servants backed by McGrath managed to get the provision of the EU Directive on PDs known as ‘The Presumption of Causation’ excluded from the EU Directive as transposed.

    This had provided for the presumption of victimization of a whistleblower, who reports wrongdoing without the whistleblower having to prove victimization is as a result of whistleblowing. This, of itself, was a significant blow to the effectiveness of the EU Directive.

    Democracy Under Threat

    Democracy depends on five major planks:

    • A free, robust and independent press.
    • A free and independent judiciary.
    • A robust and independent police force.
    • Robust whistleblower legislation.
    • A functioning democratic parliament where issue of major public import can be raised under privilege.

    The combined forces of the OPLA and the unlawfully appointed Ombudsman has dealt a direct, mortal blow to at last three of the five planks listed above. OPLA is unlawfully involved in Protected Disclosures and in the Workplace Relations Commission (WRC) and the Labour Court – both courts are subordinate to the High Court and a significant number of whistleblowers prosecute their claims, or aspect of their claims, in the WRC/Labour Court.

    Above all, OPLA has dealt an absolute mortal blow to the Dail itself. Arguably it has paralysed our parliament: there are numerous examples of OPLA muscling in, in a very heavy handed way on Dail Committee, especially in cases brought under privilege by whistleblowers to the Committees.

    The Committee Chairpersons are gormlessly allowing this, and are being bullied by the Committee Clerks who, in turn, are taking their instructions from the Dail clerk, Peter Finnegan, himself the chief architect of the draconian new OPLA in December 2018.

    In a case I had with the CPPO Committee, the OPLA took over the case from its clerk designate. I pointed out to the head of OPLA that no Standing Order (SO) of the Oireachtas allowed for it and asked what allowed it. I received no reply from Melissa English, the Chief Parliamentary Legal Adviser, whom I have accused of unlawfully and unconstitutionally trespassing into the sacrosanct area of the Oireachtas and the Ceann Comhairle, in a violation of the Separation of Powers, and a blow to the prudent use of Dail privilege.

    Irish Prison Whistleblower Sean O’Brien. Image: Daniele Idini.

    Protected Disclosure Legislation Disabled

    As OPLA operates in secret in addition to its listed function in Dunning’s capacity report of December 2016 as listed below, it may well be involved with the Gardai, and indeed with media enquires as fielded by the more robust elements in the media. I know from personal experience that the Gardai co-operate with the Ombudsman, attempting to sideline one complaint of a criminal nature I made to the Ombudsman. The Ombudsman cannot investigate suspected crimes.

    The table below from Dunning’s Capacity Report (Dec 2016) includes all the secret areas OPLA are involved in where they have no jurisdiction:

    OPLA, and indeed its boss, Peter Finnegan (Dail Clerk) have no remit in at least four areas of growth as listed above. OPLA’s remit is ostensibly confined to the tripartite functions of 1) Advices to the houses of the Oireachtas and its staff, 2) Defending the Houses of the Oireachtas in Court and 3) Help with drafting Private Members Bills (PMBs). Enhanced Protected Disclosures legislation and the whistleblowers who rely on it have been taken out with military precision.

    ‘A Whistleblower’s Motive’ by Matthew Butterly. Image: Daniele Idini.

    The Whistleblowing Industry

    I have raised the OPLA and the unlawful Ombudsman appointment with John McGuinness, Chairperson of the Oireachtas Finance Committee unsuccessfully. I have also made a complaint to the Relevant Section in the EU, responsible for the transposal of the EU Directive on Protected Disclosures into Irish law, backed by a number of other whistleblowers. The EU passed the buck back to the Irish courts. As if any whistleblower can afford to go to Court!

    Several whistleblowers (myself included) have appealed to mainstream media outlets to expose the OPLA in its unconstitutional reconfiguration since 2018 and its unlawful involvement in PDs. They have all refused to act.

    Transparency Ireland have become a quangoistic arm of state, which now fully funds the organisation. Dr Lauren Kierans, the Maynooth academic in the area of PDs who wrote the new Protected Disclosures Act for DPER has been informed that her act was sabotaged as outlined above. She passed the buck to Transparency Ireland and is now on maternity leave.

    The retaliation against and destruction of whistleblowers is all set to escalate as OPLA continues to expand. As Transparency Ireland expands too, and academic departments and units on whistleblowing mushroom in Maynooth and Galway Universities, whistleblowing has now become a lucrative industry, where everyone is well-remunerated bar the destroyed whistleblowers themselves – for whose welfare these organisations ostensibly exist.

    Whistleblower, Shane Corr (where OPLA also interfered) was suspended as a Principal Officer by Robert Watt in the Health Department. Watt was himself central to the creation and the funding of the OPLA since 2018 when he was SG in DPER until replaced by David Moloney in 2021. Corr was threatened by Watt with a criminal breach of the Official Secrets Act after OPLA deemed his submissions to the PAC were not covered by privilege.

    Whistleblower and very senior official, John Barrett, the Garda Head of HR according to a Village Magazine article some time ago, was subjected to tyrannous retaliation by Drew Harris for exposing the Templemore Garda slush funds scandal. He is awaiting a hearing in court. This is to name but two of an army of destroyed whistleblowers.

    In a deeply compromised, dysfunctional democracy, everyone will be rewarded bar whistleblowers. The Finance Committee is in a state of paralysis and the Minister who colluded all the way, Michael McGrath becomes an EU Commissioner in circumstances where he actively incapacitated the EU’s own Directive for the protection of whistleblowers.

    The irony of this cannot be overstated. What part the early announcement of his departure has to do with my rigorous challenged to the CEO of the PAS in recent days, Margaret McCabe, is anyone’s guess.

    After all, the vacancy for the EU Commissioner does not arise until October. Meanwhile, whistleblowers will continue to be condemned, vilified and relegated to the ranks of public pariah, while endless amounts of public money will be thrown at the industry and the army of persons who have colluded to destroy them. Foremost among these is OPLA and the Ombudsman. According to the Law Society Gazette in July 2018 OPLA’s Melissa English believes she’s worth it. Our democracy meanwhile, which can always be measured by the treatment of whistleblowers, was never more undermined.

  • The Brick Wall: Access to Justice

    I’m living in cloud cuckoo land
    And this just feels like
    Spinning plates
    Radiohead, Like Spinning Plates, Amnesiac 2001.

    Ten years on from the Irish Banking Crisis and the subsequent taxpayer funded bailouts, how are we faring in term of regulating the financial sector?

    In view of the possibility of another property bubble, it is surely vital to ensure appropriate access to justice, especially for those with limited resources.

    Prior to the Crash, banks through their own internal regulatory mechanisms – including risk management and third party auditing firms – were, essentially, allowed to regulate their own affairs, which unfortunately permitted a lax regime.

    On a rare occasion that a risk manager signalled grave breaches of conduct to the Central Bank of Ireland – as in the case of whistle-blower Jonathan Sugarman – he was largely ignored. And, even though thanks to his revelations we know a great deal more than we would otherwise about widespread banking mis-conducts, Sugarman subsequently had his professional and personal life destroyed. That message is surely not lost on colleagues intending to pursue a similar course.

    Back then, inadequate regulatory frameworks allowed underestimation of risk and outright profiteering in the banking sector. Yet there are reasons to believe that, despite the successes boasted of by the regulators, thousands of people are still being failed by the State.

    Despite concerns being raised in February, 2021 by Sinn Fein deputy Pearse Doherty that “2,865 complaints to the Financial Ombudsman remain unsolved for over 12 months” very little attention has been paid in the media to enduring dysfunctions in consumer protection frameworks, potentially affecting hundreds of thousands of consumers of financial services.

    Regulatory Capture

    Regulators come in two types: smart and dumb. The latter are more likely to make mistakes, and the market will learn about mistakes when firms squawk.
    Ernesto Dal Bó in the Oxford review of economic policy, Vol.22, NO.2

    Could this be a subtle example of so-called ‘regulatory capture’, which is said to occur when a particular industry holds an excessive level of influence over a statutory agency designed  to monitor and regulate it?

    Ernesto Dal Bó offers two interpretation of the phrase:

    According to the broad interpretation, regulatory capture is the process through which special interests affect state intervention in any of its forms, which can include areas as diverse as the setting of taxes, the choice of foreign or monetary policy, or the legislation affecting R&D.

    According to the narrow interpretation, regulatory capture is specifically the process through which regulated monopolies end up manipulating the state agencies that are supposed to control them.

    Either of these descriptions could easily be used to describe successive Irish government’s cosy relationship with foreign multinationals. Witness how in 2016 then Taoiseach Enda Kenny unashamedly set out Ireland’s stall as ‘the best small country to do business in’. Attracting financial service companies to a friendly, relatively unregulated, environment appears to remain high on the government’s agenda.

    But insofar as this is a legitimate goal, the way it is achieved, for example, by perpetuating dysfunctions in regulatory mechanisms, have grave consequences for the public at large, especially in terms of access to justice.

    Ombudsman

    One mechanism to provide access to justice is embodied in the role of the Ombudsman.

    This word come from Sweden where its first use is recorded in the 19th century. Meaning “Commission Man”, it involved oversight over the abuse of power by public administration. The position evolved with changing times and industries, to become globally adopted, assuming the part of an impartial mediator between individual complainants and large, well-resourced organizations.

    To give a simple example with a bit more context: what if you have a complaint against the misbehaviour of a credit institution with which you have a resulting outstanding debt?

    In Ireland, anyone in such a predicament can avail first of internal complaint procedures within the credit/insurance/pension providers. If this proves futile, as often seems to be the case, you can either go to the Financial Services and Pension Ombudsman (FSPO), or for the better-resourced, proceed directly to the courts.

    The FSPO was established in order to provide “an impartial, accessible, and responsive complaint resolution service that delivers fair, transparent and timely outcomes for all our customers, and enhances the financial services and pension environment.”

    It’s role is crucial in ensuring basic standards of consumer protection especially in a sector such as financial services, which bears significant responsibility for a dysfunctional property market

    This article is not disputing that the Office has fullfilled aspects of it’s responsabilities to date, and recognises the challanges of the past two years of the COVID-19 pandemic. The Office’s results are well presented in their annual digests of decisions, and were compellingly illustrated by the current Head of the FSPO, Ger Deering, in his Opening Statement to the Oireachtas Petitions Committee the 25th May 2021.

    What we are interrogating is why a large number of complaints, seem to have been closed in preliminary scrutiny on a narrow, legal interpretation of the Act. It is also unclear whether the FSPO is sufficiently staffed and organized to make use of the necessary banking knowledge in order to fulfil all its statutory duties.

    Boasting Figures

    Ben Hoey, an experienced ex-banker who founded Quartech services, a mortgage mis-selling advisory firm, has been assisting individuals with the filings of such complaints and has made us aware of some of the challenges encountered.

    Having submitted over fifty complaints over the last two year to the FSPO, as well as two FOI requests in June 2021 and most recently a judicial review, he also raises serious concerns over the ability of FSPO to carry out its duties.

    In an Opening Statement to the Oireachtas Petitions Committee, Mr Deering boasted: “In 2020, I am happy to report that, despite the challenges of the pandemic and remote working, we closed 6,193 complaints, an increase of 35% on 2019.”

    But thanks to Hoey’s FOI requests, we now know that 2,110 of these cases never entered the dispute resolution or investigation processes.

    Those numbers also slightly differ from the ones found in the annual report of 2020, and are presented in a way suggesting that 1,401 cases were actually sorted within a very short time frame.

    There are, undoubtedly, cases that were legitimately rejected as indicated in the Act. But in order to gain more detailed explanations for preliminary decisions, made in the first registration and assessment phase, the FOI requested documentation and records in relation to reasons for closure. Unfortunately, in this case the answer was ‘no records exist.’

    This is just the first stage of the complaint; the staff needs to interpret the Act and establish if the newly arrived complaint falls within the FSPO jurisdiction.

    It relies on training and guidance materials, which have also been released, and from this we see that when issues of jurisdiction arise, there is an over-reliance on the legal profession and a marked absence of the necessary banking expertise.

    In general, we know that if a complainant does not accept the preliminary rejection, and responds in writing, he or she receives a letter issued by the legal department. But in order to interpret and respond to this one would likely require legal advice.

    This doesn’t come cheap as the FSPO is well aware, since it spent €1.8m (46% of staff costs) on “Legal Fees” according to their 2020 accounts. By comparison the equivalent UK body filed no such expenses. Recall that the role of an Ombudsman is to be an impartial mediator between individual complainant and large, well-resourced organizations.

    Some of Ben Hoey’s clients received letters up to twenty-two pages long, containing dense legal terminology, supporting FSPO arguments not to investigate; rather than a professional financial analysis of the issue in question.

    Others have seen their complaints dragged out for years, stuck in the earliest phase of the “statutory complaints procedure”; which was established in order ‘to afford complainants an informal, expeditious and independent mechanism for the resolution of complaints.’

    From the point of view of some complainants, it feels as if the process of adjudication has been designed to keep their case out of the FSPO jurisdiction, thus keeping the number of cases that the Office investigates to a minimum.

    When the Financial and Pension Ombudsman positions were merged into their current form in 2018, the new organisation should have been structured, and staffed, to handle a increasing number of annual complaints. It appear from the latest annual report that this has been achieved, but when we get into the granular detail, we see that up to a third of these may have been inadequately handled.

    Given that a significant percentage of such disputes are in relation to mortgages and to a dysfunctional housing market, we can surely appreciate the importance of such an institution.

    The stigma attached to debt is a deep scar that afflicts many in an apparently prosperous country. Given that a level of responsibility lies with the lending industry, we should expect the Department of Finance to ensure that the relevant agencies such as the CBI and the FSPO that protect such individuals are adequately resourced.

    Yet the total count of full time employees of the FSPO is just 85 as of the end of 2021. That amounts to roughly twenty staff per million inhabitants in Ireland. By comparison, its counterpart in the UK employs double that with 3,000 staff, or approximately forty-four per million.

    A Stairway to Heaven

    Since Ger Deering was recently nominated by the Minister for Public Expenditure and Reform, Michael McGrath, to become Ombudsman and Information Commissioner, we expect that the position of Head of the FSPO will soon become vacant.

    We now have access to another FOI request providing insights into the recruitment of Ger Deering to the office in 2015/16, at a point when the Financial Services Ombudsman FSO and Pension Ombudsman were still separate bodies.

    A series of interviews were carried out with eight candidates on February 17-18, 2015 for the first round, and on February, 27, 2015 there were final interviews with the remaining three candidates, the “Board Members Guidelines” resembling a basic template for corporate hiring.

    All of the interviewers had impressive CV’s and expertise, including Mr John Hogan, then Head of Banking Policy for the Department of Finance and recently appointed as Secretary General.

    Revealingly, Hogan contributed to the “The Keane” Report on Residential Mortgage Arrears, which was criticised by Deputy Luke “Ming“ Flanaghan in 2011. The Report rules out the introduction of any scheme involving blanket debt forgiveness.

    Notably, the majority of complaints received by the FSPO pertained to financial and banking issues.  One would expect that any individual considered for that role – with powers to make legally binding decisions – would have extensive experience within the banking sector.

    By analogy, if one looks at the skills required of managers and other positions with supervisory roles, employed in the banking and insurance sectors that are imposed by the EU Single Supervisory Mechanism, we find clear guidelines in regard to required banking knowledge or one can even look up the job description for an FSPO Case Manager in PTSB.

    Yet in the advertised job description for The Financial and Pension Ombudsman we see theoretical banking or financial knowledge being “desirable” instead of “essential”, nor is there an examination process, beyond a standard interview.

    This is not to question Ger Deering’s managerial skills, nor his ability to adapt and learn, but when the job requires him to lead an oversight body over the banking, insurance and pension industries, his work experience is not what one would expect for the appointment.

    We know that the Office contains some banking expertise thanks to the qualifications of less senior staff, who have to deal with an enormous workload. But an appointment process for the top job focused on legal and managerial skills may perpetuate the current imbalance between the private and public sectors.

    In the forthcoming recruitment process for a position such as the FSPO, it is surely in the interest of the Department of Finance to appoint a person with more than generic managerial skills, and for some form of competitive examination to occur. Otherwise, it will be difficult to convince an increasingly sceptical Irish public that the government is genuinely intent on levelling the playing field between ordinary citizens and “too big to fail” corporations.

    Shared Responsibility

    One might say that appointing an ex-banker to the position creates a dangerous revolving door between banks and regulators, and is itself a recipe for regulatory capture. That argument is right to a point, but does not take into account that the necessary banking expertise might be found outside the banking industry itself, such as in auditing and accountancy firms; or by casting the net internationally to guarantee a greater degree of separation between the regulator and the regulated, especially in a small country such as Ireland.

    And, insofar as it is important to have sound legal advice, it is important that this is not set out in such a way as to intimidate complainants, and that the Office receives the same level of financial consultancy as the banks themselves.

    When we talk about consumer protection in the financial industry, we are really talking about the level field that the government promises, in relation to an industry administering one of the most powerful means of control, which is the complex socio-psychological phenomenon of debt.

    While some are celebrating that ‘The Boom is Back’, a significant proportion of the population is still struggling to overcome the effects that the previous boom and subsequent financial collapse actually brought; and, as in the period of austerity, the burden of bad choices is still carried almost exclusively by the most vulnerable and least resourced.