Ethics and governance in the European Financial centers

Luxembourg definitely fooled OECD and contracting jurisdictions. Once more.

2009-12-19T10:58:51+01:00

Remember last July.

Luxembourg was congratulated by OECD for having signed the famous 12 agreements. More are actually signed for the frontage.

"Luxembourg has shown that countries are increasingly prepared to enter into high quality agreements and to extend the network of treaties which meet the OECD standard (...) The process is working and I look forward to other countries following the example that Luxembourg has set (...) I commend Luxembourg for its swift implementation of the OECD standards on exchange of information. In three months, Luxembourg has turned into reality its commitment to fully cooperate in tax matters. I would like to congratulate Minister Luc Frieden for his leadership in this process", Angel Gurria said.

I and other warned OECD.

As far as tax agreements are concerned what do we have :

1. We had a draft law to bypass with the creation of a strange "discharging fine".

2. We have no law enforced this year which delays the implementation.

3. We had anyway professionals that called for not implementing agreements and go before the courts : "nous proposons de soumettre toute demande des autorités luxembourgeoises au contrôle d'un tribunal luxembourgeois".

By the way criminal liability of legal persons required is still neither enacted nor enforced depite two OECD injunctions last yeatr and this year.

I am happy that OECD and Angel Gurria are happy...

Switzerland bankers determine Swiss policy - again

2009-12-19T10:10:30+01:00

Tax Justice Network has reported that the Swiss Federal Council has just published a new report, Strategic directions for Switzerland's financial market policy, which is predictable in its genuflection to Swiss bankers. Indeed, as the accompanying press release notes that "The Federal Department of Finance (FDF) prepared [it] in consultation with financial market players, defines goals and measures to further strengthen the Swiss financial centre. The responsibility of the Confederation is limited to the creation of an appropriate regulatory framework."

Like in Luxembourg public policies are influenced by the business community but with a huge difference: conflicts of interest are specific to the Luxembourg jurisdiction because of the small size, which explains the reason why the regulator does not do the job as it should in Luxembourg (See the Madoff affair for example and the influences on the regulator that are traced in CSSF sources)

Angel Gurria today killed the credibility of anti-bribery convention

2009-12-09T19:04:43+01:00

The Luxembourg government today published a press release that is signed by the Luxembourg Minister of Justice and Angel Gurria.

This press release took place place in the framework of the 10th anniversary of the entry into force of the OECD Anti-Bribery Convention.

Despite Luxembourg is a secrecy jurisdiction with many scandals that are hushed up including corruption cases like the recent affair of "ruling" before the court, criminal libility of legal persons does not exist.

The press release does not say a word about this failure to comply with OECD Anti-Bribery Convention.

Legislature file

Banking secrecy is almost over

2009-12-09T05:52:28+01:00

The media have reported what Luc Frieden said in the framework of an event that was organised by PwC Luxembourg for the financial center: the banking day.

He said that a bank without secrecy should be created as in 3 or 4 years banking secrecy will no longer be possible.

It is amazing that in its press release about the event ABBL does not quote this statement.

Gibraltar works to lose ‘tax haven’ tag

2009-12-09T05:42:50+01:00

The Financial Times has repôrted that Gibraltar would have almost completed its transformation into a conventional financial centre.

“We have been repositioning Gibraltar away from the tax haven, the brass plate, the place where people just hide their money in the hope that nobody else will see it, much more into a financial centre of the onshore European variety,” Mr Caruana, chief minister, told the Financial Times.

Know more

Tax haven clamp down moving to enforcement phase: OECD

2009-12-04T05:28:06+01:00

Reuters reported that according to Jeffrey Owens, a global crack down on tax evasion in financial centers is moving into a more difficult enforcement phase.

This is exactly what I said with the significant example of Luxembourg where the enforcement is dubious.

UBS, Ernst & Young Face Luxembourg Test Cases Over Madoff Funds

2009-11-25T07:42:47+01:00

Reuters as reported that a Luxembourg court will decide in hearings starting today whether investors have the right to bring direct claims against the fund’s custodian and auditor.

The Commission de Surveillance du Secteur Financier, Luxembourg’s financial regulator, last week said it “falls exclusively to the courts” to decide whether banks must pay compensation over their role as depositary.