OECD Secretary-General Angel Gurría and Argentina’s Minister of Treasury Nicolás Dujovne presided today over the signing of a Memorandum of Understanding to establish a centre of the OECD Academy for Tax and Financial Crime Investigation in Buenos Aires, Argentina.
The signing, which took place in the margins of the meeting of the G20 Finance Ministers and Central Bank Governors in Buenos Aires, establishes the OECD Latin America Academy for Tax and Financial Crime Investigation, to be housed in the facilities of Argentina’s Federal Administration of Public Revenues. The Memorandum of Understanding was signed by Argentina’s Commissioner of Public Revenues Leandro Cuccioli and the OECD’s Director of the Centre for Tax Policy and Administration Pascal Saint-Amans.
The OECD Latin America Academy for Tax and Financial Crime Investigation will provide intensive capacity-building courses targeted at tax crime investigators and other related law enforcement officials, including prosecutors, anti-money laundering and anti-corruption officials, in particular from Latin American countries, that will support tax crime investigators throughout their careers. This will include broad-based courses on conducting and managing financial investigations as well as targeted courses on specific types of tax and financial crimes, such as those associated with crypto-currencies, money laundering and VAT fraud.
“The establishment of the OECD Latin America Academy here in Buenos Aires to train investigators in using the latest techniques to deter, detect and prosecute financial crime such as tax fraud, money-laundering or corruption, will strengthen Latin America’s capacity to tackle these crimes,” Mr Gurría said. “We are very grateful to the Argentine authorities for supporting this initiative.”
Illicit financial flows, including tax evasion and other financial crimes, have a large cost to government budgets and threaten the strategic, political and economic interests of all countries, with a particularly damaging impact in developing countries. These activities thrive in a climate of secrecy, inadequate legal frameworks, lax regulation, poor enforcement and weak inter-agency co-operation. Programmes offered by the OECD Latin America Academy for Tax and Financial Crime Investigation will be an important contribution to the wider work of the OECD Oslo Dialogue, which promotes a whole-of-government approach to fighting financial crime.
The establishment of the OECD Latin America Academy for Tax and Financial Crime Investigation builds on the success of the original centre hosted by the Gaurdia di Finanza in Ostia, Italy, and a pilot Africa Academy for Tax and Financial Crime Investigation launched by the OECD, Kenya, Italy and Germany at the G20 Africa Partnership conference in June 2017. Together, these efforts have trained more than 550 financial investigators from over 80 countries. The first events planned for the OECD Latin America Academy for Tax and Financial Crime Investigation are scheduled to begin in late 2018.
Published on the OECD on July 22, 2018
Stemming the legal transfer of wealth out of the world’s poorer countries is one of the most effective ways to help their governments raise the additional revenue needed to improve services such as education, health, energy and transport, a panel of experts said on 5 June during a high-level discussion in Geneva.
The comments came during the annual meeting of UNCTAD’s governing body, the Trade and Development Board, and the experts were addressing the issue of plugging financial leakages to help fill the trillion-dollar investment gap that developing countries face to fund the projects associated with the UN-endorsed 17 Sustainable Development Goals (SDGs).
“We know that the ambitious Sustainable Development Goals can only be achieved if we manage to mobilize national and international resources, which is far from the case currently,” UNCTAD Deputy Secretary-General Isabelle Durant said in her opening statement.
“One of the best ways of raising these resources is to plug the many financial leakages that have allowed inequalities to persist and indeed grow deeper between and within countries,” she added.
But as the speakers noted, the financial flows stripping government coffers are both illegal, such as criminal funds related to drugs, racketeering and terrorism, and legal, such as tax avoidance and the wealth stashed in offshore tax havens.
And the legal part of the pie may be the bigger and easier to combat.
According to the background note that UNCTAD prepared for the discussion, of the hundreds of billions of dollars thought to be hidden from governments, an estimated two thirds relate to cross-border tax-related transactions.
By Will Fitzgibbon
Government officials, arms merchants and corporations have spirited away millions of dollars from destitute West African nations through offshore tax havens, an investigation by journalists from the region and the International Consortium of Investigative Journalists has found.
Offshore companies were set up for a global engineering firm that avoided paying millions in taxes to Senegal, one of the world’s poorest countries; for a little-known entrepreneur who won a contract to build West Africa’s largest slaughterhouse and for a well-connected arms trafficker from Chad. In several cases, the companies, as well as the companies’ transactions and offshore bank accounts, were not declared or are only now being revealed in more detail.
The findings were drawn from a collection of almost 30 million documents, representing several leaked financial records obtained by and shared with ICIJ since 2012.
From Cape Verde’s islands of white-sand beaches and rocky volcanoes to Niger’s vast deserts, West African countries are plundered by companies and individuals, while governments do little to stem the flow.
By David Pegg
The United Nations has been urged by the Tax Justice Network to coordinate a global effort to end offshore tax evasion and corruption, amid warnings that the UK is continuing to insulate its overseas territories from financial transparency.
Commenting on the launch of the TJN’s Financial Secrecy Index 2018, which ranks countries on the size and secretiveness of their offshore sectors, its chief executive, Alex Cobham, said big financial centres had proven unwilling to reform voluntarily.
“The 2018 release confirms the long-term picture that the richest and most powerful countries have continued to pose the greatest global risks – with Switzerland and the US established as the key facilitators of illicit financial flows,” he said.
“If we are to end tax evasion, corruption, fraud and money laundering, the world’s major financial centres need to clean up their act. And since they are not willing to do that voluntarily, the UN should create a global convention to end financial secrecy once and for all.”
Switzerland, the US and the Cayman Islands are the biggest contributors to global financial secrecy according to the survey, which is published every two or three years.
The UK does not feature in the top 10 secrecy jurisdictions. However, the TJN warned that the country was continuing to frustrate moves towards greater transparency by protecting its overseas territories – former colonies, some of which have since become prominent tax havens – from reform.
The TJN acknowledged the UK had made progress at home, including by introducing a register of beneficial ownership for domestic companies, but said government efforts to encourage reform in Britain’s overseas territories had stalled following the 2017 general election.
“In recent years the government of the UK refused to impose more financial transparency on these territories, especially with regard to trusts,” the group said.
“To the contrary, it has actively protected them from international scrutiny, for example, by lobbying to remove them from the EU’s list of tax havens released in 2017.”
A spokesperson for HM Treasury said: “Overseas territories are separate jurisdictions with their own democratically elected governments and they decide their own fiscal matters.
“Thanks to our leadership, all of our crown dependencies and overseas territories with financial centres are committed to all global tax transparency standards, including the Common Reporting Standard that makes it harder for companies and individuals to hide their money abroad.”
The US has risen up the TJN’s ranking from third position in 2015. The group said the increase was driven by “a huge rise in their share of the market in offshore financial services”, with no comparable reduction in levels of secrecy.
The US has also declined to take part in international initiatives to combat financial secrecy, such as the automatic exchange of information between states. Instead it has adopted its own approach, imposing financial penalties on overseas financial institutions that withhold information on US taxpayers.
“There is now real concern about the damage this promotion of illicit financial flows is doing to the global economy,” the TJN said.
Published on The Guardian on January 30, 2018