An Ounce of Prevention Is Worth A Pound Of Cure

kristy Reforming Global Finance

Wednesday, October 5, 2011

From the Task Force Blog:

An Ounce of Prevention Is Worth A Pound Of Cure

2011 Annual Task Force Conference Preview: Illicit Financial Flows and Inequality: A Human Right Imperative

Launch Of The 2011 Financial Secrecy Index

It’s Time For The UK To Act On Its Tax Havens

Attracting The Wrong Kind Of Crowd

MEPs Say Race To The Bottom Must Be Stopped Starting With Double Non-Taxation


Financial Secrecy Index

Cayman 2nd in TJN’s new secrecy index

Cayman News Service, October 3, 2011

In its 2011 Financial Secrecy Index, published in London Tuesday, the Tax Justice Network has ranked the Cayman Islands as the second most secret financial centre in the world. In what the international anti-tax haven campaigners describe as the biggest investigation of global financial secrecy in world history, Cayman is only surpassed by Switzerland when it comes to secrecy. The TJN said that despite pledges by G20 countries to close down tax haven infrastructure it has barely been reformed. According to the report the second place ranking for Cayman is based on a combination of its “secrecy score and a scale weighting based on its share of the global market for offshore financial services.”

The campaigners said that although tax havens such as Cayman have been “frantically signing” information-exchange agreements with other jurisdictions, to qualify for the ‘white list’ the OECD standards are woefully inadequate. Following claims by world leaders at a G20 summit meeting in April 2009 promising that “the era of banking secrecy is over” TJN said that its Financial Secrecy Index (FSI) reveals that financial secrecy is as entrenched as ever.

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Tax Justice Network says Canada must do more to address financial secrecy

National Union of Public and General Employees, October 5, 2011

International watchdog points to extremely low tax rates on businesses, low regulation of resource industries and support for tax havens in the Caribbean.

LONDON — In its Financial Secrecy Index the International Secretariat of the Tax Justice Network (TJN) says that Canada needs to do more to address global financial secrecy.

The report says that “Canada’s 56 per cent secrecy score shows that it must still make major progress in offering satisfactory financial transparency. If it wishes to play a full part in the modern financial community and to impede and deter illicit financial flows, including flows originating from tax evasion, aggressive tax avoidance practices, corrupt practices and criminal activities, it should take action on the points noted where it falls short of acceptable international standards.”

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EU Commission to call for global transaction tax at G20

Reuters, October 5, 2011

By Robin Emmott

BRUSSELS — The European Commission will push for agreement on a global financial transaction tax at the meeting of G20 leaders in France next month, European Commission President Jose Manuel Barroso said on Wednesday.

Flanked by German Chancellor Angela Merkel at a news conference in Brussels, Barroso said it was time to create “new momentum globally” with the initiative.

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At G-20 meet, FM to seek retrospective tax info

Indian Express, October 5, 2011

By Shruti Srivastava

NEW DELHI — When G-20 leaders meet next week in Paris, India is likely to demand for retrospective exchange of information on tax evaders under tax treaties. Finance Minister Pranab Mukherjee, who will attend the G20 finance ministers’ meet beginning October 14, is also likely to focus on the issue of rising commodity prices and the impact of commodity futures trading and quantitative easing of food prices, sources told The Indian Express.

Food inflation has been hovering close to double digit. It stood at 9.13 per cent for the weak ending September 17, forcing a worried government to call the situation ‘grave’. While headline inflation stood at 9.78 percent for the month of August.

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Financial Transaction Tax

Tobin tax is likely, says banking chief

Accountancy Age, October 5, 2011

By Jamie Kaffash

THE UK is likely to adopt a tax on all financial transaction following pressure from the European Commission, the head of the British Bankers’ Association (BBA) has said.

BBA chief executive Angela Knight told a conference at the Saïd Business School in Oxford she expects the EU to adopt the tax, which will impose an 0.1% charge on transactions involving EU financial institutions. “If I had to make a bet, I would bet that the FTT will be adopted,” she said.

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Tax Evasion and Tax Avoidance

Tax evasion cloud over Asia refuses to budge

Swissinfo, October 5, 2011

By Matthew Allen

The explosion of wealth in Asia continues to make the region the world’s most sought after hunting ground for private bankers.

But suspicions linger that some private banks are redirecting the illicit assets of tax evaders, despite claiming that they are setting up business in Singapore and Hong Kong to tap into local wealth.

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KPMG named as US wins three tax shelter cases

Accountancy Age, October 5, 2011

By Kevin Reed

THE US HAS WON three tax shelter cases, one involving KPMG.

In WFC Holdings, Minnesota district court judge John Tunheim disallowed an $80m (£51.7m) tax refund claim filed by a subsidiary of Wells Fargo.

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Banking Secrecy

Greek banks scale data mountain in tax cheat chase

Reuters, October 5, 2011

By George Georgiopoulos

ATHENS — Greek lenders are scrambling to process a fivefold jump in requests from the country’s financial crimes unit (SDOE) for data on bank account movements as authorities clamp down on tax cheats, the banks’ lobby group said on Wednesday.

Desperate to shore up revenues and plug budget gaps to stave off default, Athens has passed legislation allowing bank secrecy rules to be lifted so that probes by the SDOE can be more effective.

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Senior executives face more risk of U.S. foreign corruption-act liability -law-firm study

Trust Law, October 5, 2011

Bribes paid in Mexico, Central America and South America were most likely to prompt charges under the U.S. Foreign Corrupt Practices Act in recent years, according to a study conducted by New York-based law firm Chadbourne & Parke LLP. The study, the results of which were released today, also found that senior executives of firms accused of paying bribes are most likely to find themselves in the dock.

The study was conducted by M. Scott Peeler, a partner at Chadbourne & Parke, who reviewed the circumstances surrounding 61 people who “were the subject of government-initiated civil or criminal action alleging FCPA violations in the past six years.”

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General Corruption

Deloitte Poll: Company Vigilance Lags Despite Patriot Act

Wall Street Journal, October 4, 2011

By Samuel Rubenfeld

A recent poll by Deloitte found that nearly one fifth of respondents say their companies are not more prepared to detect and report suspicious activity 10 years after the passage of the Patriot Act.

The poll took the form of a five-inquiry questionnaire at the end of a July 21 webcast that included professionals from the consumer and industrial products, financial services, technology, media and telecoms and defense industries. Of 1294 votes cast, 18.5% said their companies are not more prepared after the Patriot Act.

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