04/11/21

IRELAND: Tánaiste is urged to act on ‘hundreds’ of bogus companies by Quinlivan.

As published on independent.ie, Thursday 4 November, 2021.

Concerns over hundreds of fake companies that have been established here in recent months must be addressed “as a matter of urgency”, the chairman of the Oireachtas joint committee on Enterprise, Trade and Employment has told Tánaiste Leo Varadkar.

The chairman, Sinn Féin TD Maurice Quinlivan, raised the findings of a continuing investigation by the Irish Independent with Mr Varadkar at question time in the Dáil. The probe by this newspaper has exposed the fake firms.

“The fact that there is possibly a large number of bogus and fake companies must be addressed as a matter of urgency,” Mr Quinlivan told Mr Varadkar, who serves as Minister for Enterprise, Trade and Employment.

His department oversees the Companies Registration Office (CRO), where the fake companies have been registered, often using identity theft. The details of legitimate directors and businesses have been misappropriated without their knowledge.

The CRO and Mr Varadkar’s department have effectively dismissed any responsibility for preventing the fake firms from being established. The bogus companies can be used to perpetrate frauds here and abroad that could cost victims millions of euro. They can also be used to bypass trade embargoes and launder money.

“I wrote to the minister’s department in July regarding the issue, but the response from the department was pretty woeful,” Mr Quinlivan told Mr Varadkar.

The department has insisted that there was “no basis” to believe the bogus companies are actually fake, despite clear evidence in company filings that they are.

Mr Varadkar insisted the response was “robust”.

“But that is not to say that we cannot improve things further,” he added.

Mr Quinlivan pointed out to Mr Varadkar that his department has previously noted that the CRO relies on a “good faith” approach to company formations and filings, and that fines and sanctions can be imposed for making false declarations.

However, it will be next to impossible to trace the individuals creating the fake companies – almost all of which have apparent links to China.

“It is clear that [a ‘good faith’ approach] is easier for business, and is effective,” said Mr Quinlivan of the CRO approach. “But it is also clear that it leaves the register open to serious abuse.”

Mr Varadkar said owners of new firms must now be registered with the Register of Beneficial Ownership.

He said the CRO has concerns about just 34 firms on its register, despite the hundreds of bogus firms uncovered by the Irish Independent.