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Money laundering and terrorist financing through the real estate sector

The FATF recently issues its typologies report on the real estate sector. This first FATF in-depth study of the sector examines its vulnerabilities to misuse for money laundering and terrorist financing.

The FATF provides an interesting list of red flags (pages 34-37). Unfortunately these experts do not take into consideration red flags relating to the management or the audit firm of a real estate company, that are visible especially in Luxembourg the small country where everydoby knows everyone and that is self regulated:

- Knowingly appointing a dishonest managing director (recent judiciary sources) that definitely do not comply with the requirement of professional standing,
- having a "commissaire" (auditor) that is neither member of the charered accountants nor of the chartered auditors : in Luxembourg anyone may be auditor.
- having a "commissaire" that is audited by an auditor in a far tax haven (for instance a company located in Luxembourg audited by a company located in the BVI...)
- ...

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11:25 Posted in General | Permalink | Comments (0)


Anti-money laundering: Commission takes measures against 15 Member States for non timely implementation

The European Commission has decided to pursue infringement procedures against 15 Member States for failure to implement the Third Anti-Money Laundering Directive in national law. The Commission will send formal requests to Belgium, Czech Republic, Germany, Greece, Spain, Finland, France, Ireland, Luxembourg, Malta, the Netherlands, Poland, Portugal, Sweden and Slovakia. These formal requests take the form of "reasoned opinions", the second stage of the infringement procedure laid down in Article 226 of the EC Treaty. If there is no satisfactory reply within two months, the Commission may refer the matter to the European Court of Justice. The Directive should have been implemented by 15 December 2007.

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07:02 Posted in General | Permalink | Comments (0)


Germany and France urge evasion blacklist review

The OECD is being urged to update the evasion blacklist as only three countries currently remain on the OECD list of tax havens: Liechtenstein, Monaco and Andorra.

As the Financial Times reported, quoting a French Official: "There are some countries which said they would co-operate and which were then removed from the list, but in practice they have not at all".

For instance, in the context of the Liechtenstein scandal, that should inciter to be careful, when

1) officials are bold enough to state that "It is not our duty to control if the tax payer was honest" or "Banking secrecy remains : Luxembourg is not compelled to communicate its clients'data"

2) some bankers agree to facilitate tax evasion from Liechtenstein to Luxembourg.

such center is unfortunately not reliable and trustable anymore: neither for the investor whoever he or she is, nor for organisations like the OECD.

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06:00 Posted in General | Permalink | Comments (0)