The Gazette 1991

april GAZETT INCORPORATE D LAW SOCIET Y OF IRELAND Vol. 85 No. 10 June 1991

1991

g a z e t t e

In this Issue

Viewpoint 175 Admission and Refusal Law in Hotels - The Appearance of Customers 177 Practice Notes 184 From the President 187 International Award for John F. Buckley 189 News from Irish Solicitors Bar Association (London) 1 91 Lawbrief 195 Changes in the basis of income tax assessment under the Finance Act, 1990 199 Minutes of Half Yearly Meeting 203 Address by President of the Law Society to Annual Conference 204 Book Review 206 Younger Members News 207 Professional Information 209

Viewpoint Public disquiet is clearly growing with the realization that there is no comprehensive protection for monies placed with investment agencies. There can of course be no guarantee against unwise investments but there seems to be increasing evidence of non- i nves tment or at least non- i nves tment in the promised securities. The Law Society has long provided a Compensation Fund to protect clients against defalcations by solicitors. The two major associations of auctioneers have in recent years also es- tablished compensation funds in addition to the Statutory Bonding Scheme. (In passing it is surprising to note that not even in the wake of the Russell Murphy debacle have the accountants bodies established such funds.) Stock Brokers too protect their clients by means of the Stock Exchange Fund. Insurance Brokers are subject to the recently in- t r oduced con t r o ls and have bonding schemes in operation. Bodies which take deposits from the public have long been subject to the Central Bank. The travel industry too is subject to bonding requirements. Perhaps it is the very diversity of these schemes or s t a t u t o ry controls which provides the key to the problem. The absence of any satisfactory controls appears to stem from a familiar situation in our governmental arrangements. The jurisdictional functions of depart- ments are tightly drawn. Matters that cross these boundaries, such

as the law relating to children, or worse still fall outside of them may not be subject to satisfactory supervision. Given that travel agents and tour operators where the amounts involved, if not the dreams they sell, are relatively modest are so strictly controlled, it seems strange that any persons can set themselves up as investment brokers, as long as they do not sell insurance, or property, without any restrictions, qua l i f i ca t i ons or supervision. Perhaps there is a lurking view that some of the customers of dubious investment agencies have been investing " hot money" and are not deserving of great protection. Even if this were true it seems that many people have also entrusted their legitimately earned savings to such agencies. They are entitled to expect that the State will ensure that strict standards of fiscal control and probity are imposed on those who are permitted to advertise their investment services. If there are those that fall outside the existing protection schemes or controls the sooner the net is widened to include them the better, without waiting for the proposed EC Draft Directive on Capital Adequacy to weave its tortuous way into legislation. A statutory licensing system with adequate bonding should be imposed on all those not already covered by adequate schemes who solicit or receive f unds for investment from the public. • 175

Executive Editor: Mary Gaynor Committee: Eamonn G. Hall, Chairman Michael V. O'Mahony, Vice-Chairman

John F. Buckley Patrick McMahon

Advertising: Seán Ó hOisín. Telephone: 305236 Fax: 307860 Printing: Turner's Printing Co. Ltd., Longford. The views expressed in this publication, save where otherwise indicated, are the views of the contributors and not necessarily the views of the Council of the Society. The appearance of an advertisement in this publication does not necessarily indicate approval by the Society for the product or service advertised. Published at Blackhall Place, Dublin 7. Tel.: 710711. Telex: 31219. Fax: 710704