tax havens

The far-right think tanks like Jersey: now there’s a surprise

Published by Anonymous (not verified) on Tue, 12/06/2018 - 4:07pm in

I was interested in a headline in the Jersey Evening Post yesterday that read:

THE Island’s financial industry is arguably more transparent than those in the UK and the US and offshore centres like Jersey help to boost international investment, a report published by an accomplished economist has claimed.

Who is this person, I thought? They do tell all:

Diego Zuluaga, a policy analyst at the Cato Institute, based in Washington DC, has published a paper called Offshore Bet defending the role of offshore finance centres, such as Jersey, which are often criticised and labelled ‘tax havens’.

Now, I admit I have ever never heard of the accomplished person in question. But I have most certainly heard of the Cato Institute: it is a far right market fundamentalist think tank that has much regard for Trump but, I suspect, really thinks him a left winger. And the JEP notes:

The report says that offshore centres are often wrongly accused of the illegal activity of tax evasion and adds that they play an important economic role.

And how independent was this finding? Not very:

Jersey Finance, which promotes the Island’s industry, supported Mr Zuluaga’s paper. Writing on his blog, chief executive Geoff Cook said that the report, which was published by the UK’s Institute for Economic Affairs, brought more ‘balance’ to the arguments about international finance centres.

So Jersey Finance is trawling around the far-right think tanks, spilling cash along the way, and finding they think that tax secrecy designed to undermine tax revenues of legitimately elected governments is a good thing. I could have told you they'd say that for about 50p. I bet Geoff paid somewhat more. Which would tell you all you need to know about financial competence in Jersey.

Automatic information exchange from tax havens works – as tax justice campaigners always said it would

Published by Anonymous (not verified) on Sat, 02/06/2018 - 5:35pm in

According to International Tax Adviser:

HM Revenue and Customs identified a 20% jump in serious tax evasion cases in the past 12 months, according to data obtained by law firm Pinsent Masons.

HMRC had found 3,809 cases of serious tax evasion in the 12 months to 31 March. It identified 3,216 such cases in 2016-17.

More interesting is the reason why:

The suggestion is that the UK taxman is receiving more information as a direct result of the introduction of the Common Reporting Standard (CRS).
Early adopters first began sharing information in September last year. A second wave of nations; including Switzerland, the UAE, Hong Kong and Singapore, will begin reporting in September 2018

So, automatic information exchange from tax havens works.

I will notch that up as another success for tax justice. I well recall a meeting at HM Treasury in the early  summer of 2009 when I (and the few others present) were told that automatic information exchange would not happen in my lifetime, and that what, anyway would HMRC do with all that data?

My reaction was to go home and write a note explaining how it could work. And I, and others redoubled our efforts.

Of course we were not to know that the US would introduce FATCA so soon: nor did the Treasury.

But the aim of all this work has always been to change the mood music. And it works.

And several hundred people have already had their cases investigated as a result. I take some pleasure in that.

Jersey is going to lose on beneficial ownership: it really should have the sense to do so gracefully

Published by Anonymous (not verified) on Thu, 24/05/2018 - 3:17pm in

As Channel Islands newspaper The Bailiwick Express reported yesterday:

Jersey's financial services sector is being thrust back into the international spotlight with the publication of new report on how Russian money is invested overseas.

The report had been written by the Foreign Affairs Committee of the UK's House of Commons, and is entitled: Moscow's Gold: Russian Corruption in the UK.

It calls on the UK Government to set a deadline for the Crown Dependencies to make their registers of who actually owns local companies publicly available by 2020, and says that the government should be able to legislate for the islands in this area, ripping up the current constitutional position.

There are around 20,000 properties owned by Jersey-registered companies in the UK, and changing the rules would reveal the names of the individuals ultimately benefiting from those ownerships.

That's an issue for the Foreign Affairs Committee as they claim that some individuals who purchase UK property through offshore shell companies, do so to disguise their identities and potentially corrupt sources of their funding.

What can I say, except to note that as the Foreign Affairs Committee knows, we can legislate for the Crown Dependencies on issues relating to foreign affairs? In that case its threat is not idle; it is more like giving notice.

Jersey is going to lose this one: it really should have the sense to do so gracefully.

Winning the war on tax havens, one idea at a time

Published by Anonymous (not verified) on Fri, 04/05/2018 - 4:35pm in


tax havens

You can see why the offshore trolls are turning up to protest here. This was a headline from the Jersey Evening Post, yesterday:

Which critic? This one:

And what did thy report that he said?  This:

Writing on his blog, tax campaigner Richard Murphy said that there would be ‘much smuggery’ in the Crown Dependencies over the matter but it was ‘misplaced’ as the UK would soon force them to comply.

He added that he believes the Crown Dependencies will soon be blacklisted by the EU if they do not follow the British Overseas Territories in adopting fully transparent company registers.

‘All three are on the European Union tax haven greylist. Expect that to go black if they do not follow the enforced move of the Overseas Territories,’ he said.

‘Their failure to do so will prove to the EU that they are choosing not to follow the norms of best practice and sanctions will follow. The threat is very real already, and growing.

‘The UK will, in time-honoured fashion, arm-twist all three into complying. All three will comply: they will do so to protect the myth that they have free will, knowing that if they do not the UK will legislate.’

Mr Murphy added that he believed that a good option for the Crown Dependencies would be to join the UK, which he suggested could invest to revitalise their economies, if their finance sectors fail.

‘I suggest they apply to be part of the UK. I would give them parliamentary seats. I would allocate them funds to ensure that they can create new industry and services,’ he said.

‘I would ensure that they enjoy the public services that local people expect. I would eliminate their massively wasteful governments.’

He added he believed that the islands would become self-sustaining again ‘in due course’, if they followed this route.

That all comes from here.

I am grateful to the JEP. They might have called, but I will forgive them. What they're confirming is that this blog matters. I'm doing the thinking that they aren't.

So no wonder the trolls are out in force. But on the ground the JEP is confirming that they're losing and that tax justice is by offering viable ideas winning not just the battle, but the war on the issue of tax havens. It will take a while to declare victory as yet. I am confident that we will.

Exposing offshore secrets will not result in a spate of kidnappings

Published by Anonymous (not verified) on Thu, 03/05/2018 - 5:56pm in

The FT notes this morning that:

High levels of privacy have been a significant draw, said Simon Airey, partner at Hastings, a law firm. “Plenty of people live in countries where they are subject to blackmail, extortion and kidnap risk,” he added. “Some people legitimately don’t want their finances public.”

I get bored by hearing this nonsense. There is not the slightest evidence that anyone has ever been subject to kidnap, extortion or any other crime after criminals spent hours pouring over company records.

Let me be clear: I am not saying that people do not live without the fear of these crimes. I know they do. But how will the victims be identified? I  suggest that lifestyles of conspicuous consumption might be the best indicators to criminals of their potential victims.

Again, don’t get me wrong. I am not saying anyone should be a victim of crime because they conspicuously consume. That is utterly unacceptable.

All I am saying is that to suggest that offshore secrecy prevents crime of this sort is absurd. It simply does not. It does nothing of the sort. And I am bored by the apologists for offshore tax havens making these wild and wholly unjustified claims aimed at base human emotions, like fear, that have no credibility at all. Those of us opposing tax haven secrecy are not siding with criminals. We’re opposing a system widely abused by criminals. And I think those making these ridiculous excuses know that.

There will be no apology to the UK’s tax havens

Published by Anonymous (not verified) on Thu, 03/05/2018 - 4:00pm in


tax havens

The FT has reported this morning that:

Britain has incurred the wrath of several of its overseas territories by backing measures to force them to publish unprecedented levels of information about who owns the companies based in their jurisdictions by 2020.

Territories including the Cayman Islands and the British Virgin Islands fear that the new transparency measures could undermine their positions as leading offshore financial centres.

That was the intention. They have, at last, smelt the coffee.

The world can not only do without offshore financial centres, it can do better without them. No apology will be offered. They're all owed to us for the abuse that has been perpetrated for so long.

Cayman and Bermuda haven’t a legal leg to stand on

Published by Anonymous (not verified) on Wed, 02/05/2018 - 10:27pm in


tax havens

This is interesting. The Guardian has reported that

The Cayman Islands government said it was considering legal action in an attempt to stop the UK making the overseas territory open up its company ownership registers to public scrutiny, a day after MPs agreed they should do so by the end of 2020.

Alden McLaughlin, the premier of the Cayman Islands, said the territory was keeping all options on the table including a legal challenge to the amendment and accused MPs of making a decision that was “reminiscent of the worst injustices of a bygone era of colonial despotism”.

The territory was joined by Bermuda, which questioned whether the newly passed legislation was constitutional. David Burt, the premier of Bermuda, said parliament’s action was a retrograde step after 50 years of “constitutionally sanctioned self-government”. He added that the island territory would take necessary steps to ensure its constitution was respected.

I wonder if they have thought this through?

Whose law are they going to use?



I strongly suspect ours. But that concedes ours applies. And that they are subject to it. Which pretty much brings the case to a close.

And what are they going to say? That they:

a) Are British territories

b) Have British passports (albeit with some limitations)

c) Are subject to UK foreign policy and defence

d) Are represented by the UK internationally


e) Their internationally impactful financial services industry is not subject to UK control


f) The fact that we have to pick up the tab if anything goes wrong does not prevent them doing anything they like without us having the right to interfere?

That last point is worth elaborating. In 2007 the UK National Audit Office reported that:

The UK bears the ultimate risk of potential liabilities from its overseas territories

Nothing has changed since then.

So let's summarise the Cayman and Bermuda approach. What they want is self-government without assuming any of the risk of doing so and what they want to deny the UK is the right to manage the risk.

I think I can see which side the Supreme Court might take on this.

I'd offer for nothing the one-word advice a barrister once gave one of my clients: settle.

If they want two words of advice it would be settle today.

Sabre rattling will not work in the face of the reality of responsibilities.

The UK’s tax havens: where from here?

Published by Anonymous (not verified) on Wed, 02/05/2018 - 6:24pm in

Yesterday's decision by the House of Commons to impose public registers of beneficial ownership on the British Overseas Territories, but not the Crown Dependencies, is massively significant, as I have already explained. But the question has to be asked, what next?

The Overseas Territories

More than sixty years of UK policy of paying for the Overseas territories by letting them be tax havens has come to an end. They will not be havens anymore. Their secrecy has been shattered.

The UK will have to foot the bill: there will be a transitioning required for these economies. In places like the BVI, which has been dependent on selling abuse behind a veil of secrecy to fund itself, the shock will be big. Cayman, Bermuda and Gibraltar will also be heavily hit, and rightly so.

There will be loss of population: the transient professionals who largely staff the forms selling secrecy will leave these places quite soon, I suspect. The only constraint will be the time taken to wind arrangements up, and clients will be anxious to be out of there as soon as possible.

There will be loss of revenue: these places will have to tax more. But the UK government will also need to provide support: I have no difficulty with the aid budget being used for this purpose, and the need will be ongoing. It's a price well worth paying.

But look at the upside: these places are now much less likely to be sanctioned by the EU.

And look also at the upside: with finance declining the finance curse that has stopped anything else of value growing will abate: new, real, local and useful economies will emerge; of that I am quite sure. People adapt to change, albeit with smaller populations in all these places, I suspect.

The Crown Dependencies

There will be much smuggery in Jersey, Guernsey and the Isle of Man this morning for apparently having escaped this measure. It is misplaced.

All three are on the European Union tax haven greylist. Expect that to go black if they do not follow the enforced move of the Overseas Territories: their failure to do so will prove to the EU that they are choosing not to follow the norms of best practice and sanctions will follow. The threat is very real already, and growing.

The UK will, in time-honoured fashion, arm-twist all three into complying.

All three will comply: they will do so to protect the myth that they have free will knowing that if they do not the Uk will legislate.

They too will then have to transition. I suggest they apply to be part of the UK. I would give them parliamentary seats. I would allocate them funds to ensure that they can create new industry and services. I would ensure that they enjoy the public services that local people expect. I would eliminate their massively wasteful governments. And I would expect there to be significant declines in population as the fly by night tax secrecy vendors sell out. But that will create a massive tourist rental income market for local property that will sustain the local economy: these are places worth visiting. Again, the finance curse will be lifted. And I strongly suspect that they will self-sustain themselves in due course on a new basis.

Alternatively, they could now adopt my plan B. That would require a brave financial services sector, but for one of them this could be a real win.

The City

The City will be cursing: they have loved dealing with the flows of supposedly anonymous money the tax havens have supplied, and will no more.

But the City is in for a shock already. This is a minor blip in comparison to Brexit.

And if the City cannot survive without dirty money then it should not be there at all.

No one should be shedding tears for any imapct on the City.

The UK

We can hold our heads up high. We have done the right thing.

We made transparency the new standard.

The risk of the UK being sanctioned as a tax haven by the EU after Brexit has declined considerably.

Our standing in the world should rise, considerably.

We should raise more tax.

And face less crime.

We should have fairer competition.

But let's also be clear: we have to get our own house in o0rder: Companies House is an utterly ineffective company regulator and we too have to do a lot better to ensure that beneficial ownership is really on public record on this country.

The EU

The EU has to take note.

It has to threaten the Crown Dependencies.

But it has to ensure that this standard is really met across the EU as well. Right now the EU's company registers are dire (many making Companies House look good: I am researching the issue and it is not a pretty picture). There can be no-grandstanding. When all EU countries deliver we can be happy, but right now they also do not. So it's time for action there too.

The rest of the world

A new standard has been set. And now the Financial Action Task Force has to take note. And that standard has to become universal with action against places that do not comply.

And let's be clear where the biggest problem is: it is in the USA. That is now the world's biggest seller of secrecy. And that abuse has to end.


The above makes clear that there is still much to do, and many battles still to be won.

And beneficial ownership is not the end. Then we want all accounts, unabridged, on public record. Only then can we really beat abuse.


This was a big day.

There is much to do.

But those shedding tears need to smell the coffee, and the rest need to take note: transparency is the new norm. You can't stop it.

The real beginning of the end for tax havens has begun

Published by Anonymous (not verified) on Wed, 02/05/2018 - 12:14am in


tax havens

Fifteen years ago John Christensen and I became the first full tme anti-tax haven campaigners in the world. We had almost no funding, apart from the support of our wives and a single donation. And I think it fair to say that few had a clue what we were trying to achieve, but the Tax Justice Network is testament to our vision.

We have had successes over the years on individual issues and major policies, like country-by-country reporting. And we changed the language used to discuss these places. Most especially, in 2009 I wrote a paper that suggested that it was secrecy that we were really challenging. The term secrecy jurisidiction came into use pretty much as a result, promoted by this blog.

What we have never done until today was shatter open a secrecy jurisidiction. We’ve come close, forcing tax reforms in Jersey, Guernsey and the Isle of Man and leading campaigns for automatic information exchange from all tax havens.

But this afternoon the UK government has caved in: it will not oppose Margaret Hodge’s amendment to new UK anti-money laundering laws requiring that the Overseas Territories (BVI, Cayman, Bermuda, Gibraltar, Anguilla, Montserrat, Bermuda for these purposes) have public registers of the beneficial ownership of companies, whether or not they wish for them.

Their secrecy is shattered as a result.

I sincerely hope that the government will also accept the amendment on Jersey, Guernsey and the Isle of Man as well. Then I will really be celebrating.

Today we began to shatter tax havens. It’s taken fifteen years. And it has been worth it.

The world will be fairer.

And more equal.

More taxes owing will be paid.

The rule of law will be upheld.

Democracy will be reinforced.

And crime will be harder to perpetrate.

I might celebrate tonight.

Just one glass, mind you. There are more tax havens to beat as yet.

Today could really mark the beginning of the end for the UK’s tax havens

Published by Anonymous (not verified) on Tue, 01/05/2018 - 4:25pm in

Today MPs vote on an amendment to the Sanctions and Anti-Money Laundering Bill that would require the UK to impose a requirement on the UK’s Crown Dependencies and Overseas Territories that they create registers of the beneficial ownership of companies if those places fail to do so of their own free will.

This matters. Most of the time most of what happens in Westminster appears technical, distant and remote. And, let’s be honest, also rather boring because much of what is done is whipped, which means MPs vote as they are told to do by their parties. That provides much of the explanation for the low attendance in the Commons Chamber, I suspect.

But every now and again MPs get a chance to tilt the world on its axis, at least just a little. This is one such chance. Tax haven secrecy is, as I have long argued, deeply corrosive. It undermines fair competition. It creates and reinforces wealth inequality. It undermines the rule of law. It threatens democratic states' ability to tax, which effective management of their economies requires. And it aids illicit activity from sanctions busting to election rigging, crime and trafficking in all its ugly forms.

As a result if the tireless efforts of Margaret Hodge MPs have a chance to shatter this secrecy. And that would send a message to the world. First, it would say that the City of London is only open to honest business, because right now they use the tax havens to route the illicit parts.

Second, it would say the UK is a believer in fair competition.

Third, it would say that we will uphold democracy, the rule of law and the right to tax.

Fourth, it will say cheats should play no part in our society.

That’s why I say:

Will it happen though? The government is fighting a furious rearguard action, but which simply promises action when the rest of the world agrees, which is no promise at all. I hope no one is conned.

For the record this is the amendment that MPs will be asked to vote on, with those supporting it already named on it:

And as a footnote, the last time the Commons was presented with such an opportunity I wrote the clause in question for the late Michael Meacher MP. It was clause 9, here. I have a very real interest in this issue.