Today’s Top Stories from GFI: U.S. Treasury delays offshore tax-dodge law by 6 months

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U.S. Treasury delays offshore tax-dodge law by 6 months
Reuters, July 12, 2013

By Patrick Temple-West

The U.S. Treasury Department said on Friday it will postpone enforcement of a new law that cracks down on offshore tax avoidance by Americans by six months to give foreign banks more time to figure out how to comply.

The Foreign Account Tax Compliance Act, or FATCA, requires foreign banks, insurance companies and investment funds to send the U.S. Internal Revenue Service information about Americans’ offshore accounts worth more than $50,000.

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DAP offers to work with BN: Let’s fight graft, not stir up racial hate
Malaysia Chronicle, July 13, 2013

By Lim Guan Eng

DAP offers to work with the BN federal government by uniting all Malaysians around fighting corruption instead of dividing Malaysians with hate and lies about race and religion. DAP is making this offer in the national interest following the latest survey by Transparency International (TI), which showed that Malaysians were losing faith in the government’s effort to fight graft.

Police and political parties were perceived to be the two most corrupted institutions, with police hit the corruption scale at 4.0 while political parties registered 3.8 with 5 being extremely corrupt. According to the latest March 2013 Transparency International-Malaysia’s (TI-M) Global Corruption Barometer (GCB), only 31 percent of respondents thought the government had been effective in fighting corruption, down from 49 percent in 2011.

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Corruption

Spanish prime minister rejects calls to step down over scandal
Reuters, July 15, 2013

Spanish Prime Minister Mariano Rajoy on Monday rejected calls for his resignation over a ruling party financing scandal and said he would not allow the matter to deter his reform plans.

The pressure mounted on Rajoy as the former treasurer of his People’s Party gave new testimony before a judge looking into the affair, saying he handed envelopes of cash to Rajoy and other party leaders in 2008, 2009 and 2010.

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Money Laundering

Please, Barclays – reconsider cutting off a lifeline to the world’s poorest families
The Guardian, July 15, 2013

By Rushanara Ali

For 30 years, one of my constituents has been sending money to his family in Bangladesh and their neighbours. He also supports his widowed niece and her three children by paying their school fees and health costs.

They live in a remote part of the country, so he uses the local Bengali-speaking money transfer agent, based in Brick Lane in London, which has a network of agents and is able to reach towns and villages throughout the country, and at affordable rates.

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RBI penalises 22 banks for money laundering, violating customer identification rules
Economic Times, July 15, 2013

RBI on Monday imposed fines totalling Rs 49.5 crore on 22 private and public sector banks including SBI, PNB and Yes Bank for violating KYC/anti-money laundering norms.

It also gave cautionary letters to seven including Citibank and Stanchart following an expose made by an online portal.

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Dodgy deals for bank cards, accounts soar 
The Standard (Hong Kong), July 15, 2013

The illegal trade in debit cards and bank accounts is reportedly heating up in the mainland as buyers use them for money laundering and other dodgy activities.

A debit card can fetch 500 yuan (HK$631.78) even if there is zero balance in the account. Hundreds of such deals take place every month, according to Yangtse Evening Post.

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Gov’t to file complaint against JP Morgan, BNP
Buenos Aires Herald (Argentina), July 15, 2013

The government will file a formal complaint against JP Morgan and BNP Paribas for money laundering before the Union of South American Nations (Unasur), a local daily reported yesterday.

Argentina will reportedly file the complaint against the multinational banking and financial services firms onAugust 19 at the High Authorities of the South American Citizenry, Justice and Coordination against Transnational Organized Crime Council’s (Altas Autoridades del Consejo Suramericano de Materia de Seguridad Ciudadana, Justicia y Coordinación de Acciones contra la Delincuencia Organizada Transnacional) summit in Peru.

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Tax Evasion and Avoidance

G20 sharpens attack on international corporate tax avoidance
Financial Times, July 14, 2013

By Vanessa Houlder

Finance ministers from the Group of 20 leading nations plan to launch a new phase of the international crackdown on corporate tax avoidance this week even as UK business leaders are warning their government to resist “radical new solutions” to profit shifting by multinationals.

Britain has taken a lead in pressing for reform of the international tax rules after a wave of public anger over the low tax bills paid by some large multinationals. An action plan on tackling base erosion and profit shifting is due to be presented to the G20 by the Paris-based Organisation for Economic Co-operation and Development on Friday.

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Multinationals, wealthy on tax hit-list
Financial Review (Australia), July 15, 2013

By Katie Walsh

Multinationals and big businesses that shift profit offshore to slash tax bills will receive more scrutiny than ever before, the Australian Taxation Office has revealed in its annual hit-list of targets.

More than 150 companies will face risk reviews and audits from the ATO in the coming year, as it scrutinises global transactions as part of the federal government’s crackdown on tax-avoiding multinationals and the broader global movement against the activity.

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France, Switzerland Ink New Inheritance Tax Accord
Tax-News, July 15, 2013

By Ulrika Lomas

Swiss Finance Minister Eveline Widmer-Schlumpf and her French counterpart Pierre Moscovici have recently signed, in Paris, the new Franco-Swiss agreement aimed at avoiding double taxation in the area of inheritance tax. Both Ministers also signed a joint declaration reaffirming their commitment to extensive bilateral dialogue, to resolve outstanding tax issues.

Replacing the existing bilateral accord from 1953, the new text is intended to put an end to certain situations of non-taxation of inheritances. The revised treaty provides that France can tax heirs and beneficiaries resident in France, although after deduction of any inheritance tax paid in Switzerland. Switzerland thereby retains its primary right of taxation and its taxing power is not affected.

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Global Financial Integrity (GFI) promotes national and multilateral policies, safeguards, and agreements aimed at curtailing the cross-border flow of illegal money. In putting forward solutions, facilitating strategic partnerships, and conducting groundbreaking research, GFI is leading the way in efforts to curtail illicit financial flows and enhance global development and security.

For additional information please visit http://www.gfintegrity.org.