Ethics and governance in the European Financial centers

This is the e-mail I sent to the attention of Commissioner Kovács:



Dear Mr Kovács:

I have read in Le Temps an article stating that Luxembourg is opposing your project of directive and yourself.

The jurisdiction is leading as well a cabal against the OECD and Angel Gurria.

While Switzerland is making amends like Micheline Calmy-Rey who stated recently that "In the current economic context - where our neighbors suffer from a major economic crisis - we did not have quite simply the good product anymore. We could not justify any more that billions illegitimately leave our partners' coffers", Luxembourg goes on denying its issues.

At the same time, Prime Minister Juncker gave an interview (http://www.lalibre.be/index.php?view=article&art_id=497331 ) stating that Luxembourg is not the problem and Jean-Jacques Rommes, who chairs the Luxembourg Banker's association, did not make amends as well (http://www.paperjam.lu/archives/2009/05/2404_PF_Rommes/index.html ).
They deny that in Luxembourg:
-    Banks knowingly help to commit fraud (see http://ethiquedesplaces.blogspirit.com/archive/2009/02/24/it-is-not-the-banker-who-started.html ),
-    There are offshore abuses (see http://ethiquedesplaces.blogspirit.com/archive/2009/03/29/offshore-in-luxembourg-the-tax-haven-is-there.html ) through Luxembourg with many dubious companies (http://ethiquedesplaces.blogspirit.com/archive/2008/09/07/exotism-in-the-corporate-registration.html )  with no economic reality,
-    Luxembourg does not care about the OECD Recs despite an injunction last year to introduce the criminal liability for legal persons (see http://ethiquedesplaces.blogspirit.com/archive/2008/03/29/oecd-urges-luxembourg-to-introduce-liability-of-legal-person.html ), which is neither enacted nor enforced one year later,
-    Etc.

When reading what they are saying, it appears that the membership (EU and OECD) was intended to prevent any sanction. Hence the strong feeling of impunity mixed with anger.

Yours sincerely

Jérôme Turquey
Consultant is business ethics and reputational risk
http://ethiquedesplaces.blogspirit.com

Micheline Calmy-Rey made courageous statements that are reported in La Tribune de Genève.

Like the other jurisdictions with banking secrecy, Switzerland could not accept the OECD rules if competitors did not.

But what this Swiss minister adds is worth congratulating her for.
Dans le contexte économique actuel – où nos voisins souffrent d’une crise économique majeure – nous n’avions tout simplement plus le bon produit. Nous ne pouvions plus justifier que des milliards quittent illégitimement les caisses de nos partenaires.
“In the current economic context - where our neighbors suffer from a major economic crisis - we did not have quite simply the good product anymore. We could not justify any more that billions illegitimately leave our partners’ coffers.”

I cannot see such evolution in every jurisdiction on the grey list. For example, yesterday Prime Minister Juncker gave an interview stating that Luxembourg is not the problem and today Jean-Jacques Rommes, who chaired the Luxembourg Banker's association, did not make amends as well.


Both are denying that banks knowingly help to commit fraud, offshore abuses through Luxembourg with many dubious companies, the non implementation of OECD Recs despite an injunction last year, etc.

I do believe that Switzerland will abide by its commitments.

It is very interesting to read again all the annual speeches of Juncker before the parliament.


In particular the one he gave last year whereas the text of Levin, Coleman and Obama was known and that the Liechtenstein scandal took place. In 2008, Angel Gurria stated that "Excessive bank secrecy rules and a failure to exchange information on foreign tax evaders are relics of a different time and have no role to play in the relations between democratic societies"

In 2008, Jean-Claude Juncker

- did not speak about the problems of banking secrecy ("secret" : word missing)

- did not speak about the problems of tax evasion ("évasion" : word missing)

- did not speak about the problems of tax haven ("paradis" : word missing)

- did not speak about the abuses the offshore ("offshore" : word missing, "domiciliation" : word missing)

- did not speak about fraud ("fraud" : word missing)

-…


The former years he had spoken about these issues but definitely ignored their acuity in 2008.



In a nutshell, he did not see or did not want to see that he was up against the wind that now is blowing in his face.