The Dáil Joint Committee on Finance, Public Expenditure and Reform and Taoiseach has been told that Russian connected 'Section 110' firms resident in Ireland raised €118 billion over the years 2005-2017.

Jim Stewart, Adjunct Professor in Finance at Trinity College Dublin, told the Committee that Section 110 firms are Irish resident "special purpose vehicles" which own or manage "qualifying assets" owned by trusts or charitable trusts.

He described them as a form of "hybrid finance" with "very valuable tax benefits."

However, the Professor described these arrangements as "legal fictions."

In answer to questions from members of the committee, the Professor said he believed there’s a gap when it comes to regulating these entities.

He said the Central Bank is not directly responsible for regulating them nor is the Charities Regulator.

He added that regulation "falls between stools", would take a huge amount of resources and issues over the identity of the beneficial owners of these firms and needs to be tackled at a European level.

In answer to a question from Sinn Féin's Mairéad Farrell TD over whether professional firms dealing with some Section 110 firms should be fined, Professor Stewart said that would be difficult to impose as the firms were acting within the law.

In his opening statement, Prof Stewart said that amongst the Russian connected firms which had availed of Section 110, Russian Railways has raised €10.1billion in 2010-2021.

He also stated that "a number of banks" had used Section 110 to raise finance for the Russian military.

His opening statement also referred to Russian owned aircraft leasing firms as the next largest Russian connected grouping after Section 110 firms with €5.4 billion in assets in 2020, a figure the Professor believes is "likely to be far larger."