Matt Shanahan urges Ireland to adopt EU anti-counterfeiting directive
Matt Shanahan argued for immediate transposition of the 2014 directive on protection of the euro, urging Ireland to adopt criminal offences, sanctions and Central Bank powers to combat counterfeiting. He said Ireland is the last country to transpose the directive and called for prompt legislation, a National Analysis Centre and stronger sentencing to protect the currency and public confidence.
Directive and call to act
Matt Shanahan set out why transposing the 2014 directive on protection of the euro and other currencies against counterfeiting is urgent. He urged the House to move appropriate legislation at the earliest opportunity so Ireland is in lockstep with European partners and to preserve confidence in the euro.
Central Bank powers and National Analysis Centre
The speech summarised proposals to give the Central Bank of Ireland new monitoring and enforcement functions over suspect counterfeit euro currency. The bill would designate the Central Bank's currency centre as the national analysis centre for euro notes and coins, tasking it to examine, record and monitor suspect counterfeits and provide specialist training.
Criminal offences and corporate liability
Matt Shanahan highlighted that the directive calls for criminal offences and sanctions for counterfeiting, including provisions for bodies corporate and officers such as directors or managers to be found guilty when offences are attributable to them. He argued for significant criminal sentencing for those who actively collaborate in counterfeiting due to system-wide risks.
Scale of counterfeiting and security measures
He noted the long-standing scale of counterfeiting, citing at least €500 million in financial damage since 2002 by organised crime groups. He referenced recent security improvements in euro banknotes, including the Europa series and ECB e-learning resources, while noting 308,000 counterfeit euro banknotes were withdrawn in the second half of 2019 - a 22% increase on the first half of 2019 and 17% up on the second half of 2018.
Economic risks and urgency
Matt Shanahan warned that without robust law and oversight counterfeiting can erode market sentiment and pose macroeconomic risks across member states. He acknowledged changing payment habits and said that despite a move toward a cashless society, Ireland must ensure its currency remains solid and secure - urging legislation sooner rather than later and noting "Berlin is indeed closer than Boston" as a prompt for action.
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The counterfeiting minister refers to something capable of passing for a currency, note or coin of that description or if it is a currency, note or coin which has been so altered that it is capable of passing for a note or coin of some other description a long way around of saying basically a fraudulent copy. Ireland is the last country to transpose this 2014 directive on the protection of the euro and other currencies against counterfeiting. The main planks of the directive calls on Member States to introduce criminal offences and sanctions relating to counterfeiting of the euro and other currencies. The directive also addresses territorial jurisdiction and calls for special investigation powers and measures. This directive transposing into law will conjoin Ireland with protecting against counterfeiting to ensure the continued confidence and trust in the authenticity of the euro currency. Without an integral value supported and controlled by international law, no one could have confidence dealing in euros, thereby threatening EU financial stability, thereby threatening EU financial stability. Financial property, integrity and resilience is the bedrock of a currency and this can only be ensured by adequate coordinated law to protect against currency counterfeiting. The bill is said to provide for a range of new powers and functions for the Central Bank of Ireland in respect of monitoring and enforcement measures relating to suspect counterfeit euro currency and no currency that is not deemed to be suitable for recirculation. Included is the designation of the currency centre of the central bank bank as a national analysis centre for euro notes and coin and the national analysis centre for coin for euro also. The legislation provides for offences committed by a body corporate or which are attributable to a person who is a director, manager, secretary or other officer of the body corporate. Such a person as well as the body corporate may be found guilty of an offence. Counterfeiting has long been a lucrative trade and often perceived a victimless crime unless, of course, you are the person receiving the counterfeit monies as payment. Since 2002, organised crime groups active in money counterfeiting of the euro have caused financial damage of at least €500 million. Without robust law and oversight, this figure would be far higher, causing not alone debt, but it also has the potential to erode market sentiment in trading euro-denominated holdings. It is in the interest of the union as a whole to oppose and pursue any activity that is likely to jeopardise the authenticity of the euro currency by counterfeiting. The National Analysis Centre will look at the suspect counterfeit banknotes and coins that are sent to the central bank. It has a duty to examine, record and monitor suspect counterfeits as part of a strategic defence to counterfeit activity. The National Analysis Centre is also tasked with providing training to professional cash handlers, members of Angarda-Shirkhana, Customs Official and other bodies on counterfeit detection. The courts must also recognise both the loss that can occur as a result of counterfeiting as well as the overall system vulnerability to large and wide-scale counterfeiting which could have a macroeconomic effect not just for Ireland but for other member states. As such, significant criminal sentencing must apply to counterfeiting for those who actively collaborate to support it. Eurobanknotes have been undergoing a series of security improvements in recent years and the more recent Europa series provides for more sophisticated security measures aimed at ensuring the security of the currency. A range of print and security features are being rolled out to improve the identification of approved euro notes and to confound possible copying. The ECB also provides training material in the form of an e-learning course covering the characteristics, authenticity, the fitness of the banknotes to complement professional cash handlers training. Despite these improvements, Eurozone reports for the second half of 2019 note that 308,000 counterfeit euro banknotes were withdrawn from circulation in the second half of 2019. This represents a 22% increase when compared with the first half of 2019 and a 17% increase on the amount in the second half of 2018. Of these counterfeit notes, 96% were found in other euro-area countries. This demonstrates the need for vigilance for training systems and for detection devices for businesses in Ireland who handle predominantly cash payments. Ireland has come a long way in terms of how we do business and deal with money transactions. Cash payments are becoming less commonplace as we appear to be moving to an almost cashless society. Nonetheless, we need to know our currency is solid and secure. The proposed change is that ratifying this directive calls for will keep us in lockstep with our European partners in terms of protecting our common currency and providing protection to our consumers. Given that we have prevaricated to date on this issue and understanding now most forcibly as a result of COVID that Berlin is indeed definitely closer than Boston, I would propose the House moves appropriate legislation to meet the requirements of this directive and resulting legislation at the earliest opportunity. That is an answer to the interest of the government. Thank you. Thank you. That's the question. Thank you.
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