According to a recent editorial from The Guardian, the illicit activities that drive capital flight, such as drug trafficking and terrorist financing, are actually supported by legal infrastructure. Namely, the lack of transparency in regions designated as “tax havens” allows for elaborate tax avoidance schemes and money laundering that funds these sorts of activities. As an example, banking company HSBC reportedly held a Cayman Islands subsidiary that “handled some 60,000 accounts,” which “drug lords used . . . to fuel their jet-set lives.”
According to the newspaper, politicians must address the issue of tax haven abuse. In affected countries such as the United Kingdom, steps must be taken that increase both transparency and corporate tax accountability:
“Experts suggest the UK should embrace a range of remedies, from pressing for automatic information-sharing agreements with other countries to increasing the level of corporate transparency in its own crown dependencies and overseas territories.
A publicly available registers of trusts – the vehicles commonly used for tax avoidance in tax havens – would also be a positive step. So, too, would a decision by the UK government to support ‘country by country’ reporting, whereby companies are required to show the profits and the tax they pay in each country within which they operate, an accounting initiative that would encourage transparency and accountability and highlight when tax havens were being used.
Save the Children’s Head of Research Alex Cobham has launched a blog that examines issues of inequality. Named “Uncounted,” the blog has listed topics such as the life expectancy of indigenous peoples, caste and tribal poverty, and female illiteracy as those that reflect society’s marginalization of individuals. At the same time, Cobham applies his inequality motif to tax issues, yet he notes a distinction between being “uncounted” by a lack of power and being “uncounted” by design. The latter “reflects the presence, not the absence of power.”
Wednesday’s Top News Stories from Global Financial Integrity.
Tuesday’s Top News Stories from Global Financial Integrity.
Monday’s Top News Stories from Global Financial Integrity.
Wednesday’s Top News Stories from Global Financial Integrity.
In this video, the United Nations Office on Drugs and Crime follows individual Euro bills as they are used illicitly, ultimately showing the annual $870 billion proceeds from criminal networks. The filmed transactions highlight profits by counterfeiting, illicit drug trafficking, human trafficking, and trading illegal arms. The UNODC also captures the impact of this underground [...]
Friday’s Top News Stories from Global Financial Integrity.
In this video, the United Nations Office on Drugs and Crime follows individual Euro bills as they are used illicitly, ultimately showing the annual $870 billion proceeds from criminal networks. The filmed transactions highlight profits by counterfeiting, illicit drug trafficking, human trafficking, and trading illegal arms. The UNODC also captures the impact of this underground [...]
Wednesday’s Top News Stories from Global Financial Integrity.
Monday’s Top News Stories from Global Financial Integrity.
The Institutional Revolutionary Party (PRI)’s victory in Mexico’s presidential elections signifies a new challenge for curbing Mexican capital flight. Returning after a 12 year hiatus from office, PRI will govern both a quickly growing democracy and an underground economy that transcends the party’s old negotiation strategy. Modern drug traffickers in Mexico’s most corrupt regions have more intelligent and larger money laundering operations than those of previous decades, signaling a need for greater transparency in Mexico’s financial structure.
Do you care about stamping out corruption, money laundering and tax dodging? The Financial Transparency ...
May 21, 2013
The solutions to problems are often implicit in the way they are framed. If I ...
May 15, 2013
Below the jump: a fantastic infographic on how money is hidden by large U.S. corporations ...
May 13, 2013
Things have been busy here at Task Force Blog central over the past few weeks. ...
May 10, 2013
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