DUBLIN Ireland's Financial Regulator called for a re-evaluation of financial crime laws, saying delays in prosecuting those involved in the collapse of the banks were undermining public confidence.
No-one has so far been jailed for their part in a banking failure which led to a bailout involving more than 60 billion euros ($77.6 billion) of taxpayers' money - equivalent to 40 percent of GDP - and high-profile prosecutions of the heads of Irish Nationwide IRNBS.UL and Anglo Irish Bank have dragged on for years.
"This track record arguably undermines public confidence in the enforcement system ... and weakens its deterrent impact to head off the next crisis or scandal," Financial Regulator Matthew Elderfield said in a speech in Dublin on Tuesday.
"Surely, then, there is a case to step back and ask some rather fundamental questions."
While a growing number of financial firms have been subject to sanctions in recent years, the prosecution of individuals has lagged, Elderfield said.
His office and its pre-crisis predecessor had only been able to impose financial sanctions on seven individuals over the past 10 years, while criminal prosecutions were a long way from reaching fruition.
"We should somehow take the opportunity to ask some searching questions about how we can raise our collective game to ensure that we have a truly effective enforcement system," he said.
A stricter test of responsibility for senior management in firms that have been found in breach of regulations should be considered, he added.
Authorities should also consider introducing some degree of presumptive liability or sanctions for directors of banks which failed and required public support, similar to a proposal by Britain's Financial Services Authority.
He also mentioned the possibility of introducing a general offence, either civil or criminal, for reckless trading by a financial services company.
(Editing by David Holmes)