Ethics and governance in the European Financial centers

Richard Murphy from tax Justice Nerwork has recently published and analysis about Jersey.
He observed thta Jersey’s new independent fiscal policy panel has reported for the first time that "the nalysis of future trends in tax and spending highlight that there is a real risk that States finances could deteriorate significantly in the medium-term and this should be at the forefront of States members’ minds when they debate the 2009 Business Plan."

And Richard to conclude that "Give them five years, then watch them go bust."

Fernand Grulms, head of Luxembourgforfinance, will be speaker at a conference on the subject "Quel avenir pour la place financière de Luxembourg ?" (What future for the financial center of Luxembourg?).

In the context of the international paradigm shift and considering the "System" in Luxembourg, I have the same conclusion as Richard : Give them five years, then watch them go bust.

Unless they do the required aggiornamento.

It is up to the leaders. But they will have to kill professionnally or politically dubious leaders, their friends in the framework of relationships and networks.

The Permanent Subcommittee on Investigations had scheduled a hearing, "Dividend Tax Abuse: How Offshore Entities Dodge Taxes On U.S. Stock Dividends," on Thursday, September 11, 2008, at 9:30 a.m., in Room 106 of the Dirksen Senate Office Building. The Subcommittee examined how some financial institutions have designed, marketed, and implemented transactions to enable foreign taxpayers, including offshore hedge funds, to dodge millions of dollars of taxes on U.S. stock dividends. The hearing also examined whether current law relating to dividend taxation and withholding should be strengthened. The Subcommittee expects to issue a Subcommittee staff report in conjunction with the hearing summarizing its investigative findings and recommendations. Witnesses included representatives of U.S. financial institutions, offshore hedge funds, a tax expert, and the Internal Revenue Service.


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Angel Gurria, OECD Secretary-General, recently said in the framework of the Conference on the 50th Anniversary of the OECD Model Tax Convention that "Co-operation is required to ensure that taxes do not become the last barrier to expanding cross-border trade and investment, but also to ensure that taxpayers pay the right amount of tax, at the right time and in the right country. It is worrisome to see some countries that still try to attract tax evaders worldwide through secrecy and lack of transparency. It is also worrisome that some financial intermediaries still make a business out of that and promote the use of tax havens (...) it is time to stop these practices by increasing international co-operation to counter them."

I guess he did appreciate what Lucien Thiel, former chairperson of the Luxembourg Bankers Association said early 2008. This important leader from the banking sector admits that banks do not control the client’s honesty: He stated just after the beginning of the Liechtenstein affair that “It is not our duty to control if the taxpayer was honest” and "Banking secrecy remains : Luxembourg is not compelled to communicate its clients'data." (In L'Essentiel, 27.02.08).

Mr Lucien Thiel is a respected leader whose statements reflect and influence the business behaviours in Luxembourg. He clearly confirms that Luxembourg does not care of the taxpayer's honesty. This is true for tax fraud as well as for tax evasion. Hence the use of entities from the BVI and similar jurisdiction in the setting up of Luxembourg registered companies as traced in the Corporate Registration.

But anyway Luxembourg is a jurisdiction that may provide "generous grants" for which it is thanked...