Ethics and governance in the European Financial centers

Bloomberg has reported that BNP Paribas SA, France’s biggest bank, lost two lawsuits seeking to force UBS AG to release a combined 2.5 million euros ($3.1 million) that had been invested with two funds linked to Bernard Madoff.
UBS has won four straight rulings over investors seeking the immediate return of their funds since the bank lost the first case filed by French fund manager Oddo & Cie. seeking 30 million euros from the LuxAlpha fund. Since then, court’s have supported UBS’s arguments that it can’t release money to investors until all investor claims have been filed. UBS appealed the ruling by ordering it to reimburse a French fund-management company €30 million ($38.6 million) that had been invested with New York financier Bernard Madoff. The decision is pending.

All cases are relating to redemption requests which took place before Madoff was arrested.

Luxembourg cannot inspire confidence.

So cannot inspire confidence the CSSF, that took measures "in order to protect the interests of investors" as it said only a couple of weeks after the begining of the Madof Case.
- 03/03/2009, Withdrawal of the sicav Luxembourg Investment Fund from the official list,
- 11/02/2009, Withdrawal of the sicav HERALD (LUX) from the official list,
- 03/02/2009, Withdrawal of Luxalpha Sicav from the official list.

It is as if we had an infringement to the traffic regulations: someone burns a stop, and only three months later the whistle of the policeman is heard.

The reality is that the rules in the jurisdiction are so confused that there is an actual legal insecurity.

Europe's Commissioner for Taxation Laszlo Kovacs has blasted Austria's banking secrecy laws and urged Vienna to lift them or face consequences, in an interview with an Austrian magazine.

"Banking secrecy should not protect fraudsters," Kovacs told the weekly Format in an interview to be published on Friday.
"It is unacceptable that banking secrecy in one (EU) member state can hamper the tax authorities of other member states," he added.

Kovacs warned of serious consequences if Austria did not lift its banking secrecy soon, as other states have already done.

Austria is supported by Luxembourg, that should be warned in the same way as both states were recently in agreement to refuse. On 25 February, Luxembourg minister for justice and budget Luc Frieden said in Austria that Luxembourg and Austria were ready to take part constructively in a discussion in the EU and the OECD [Organisation for Economic Co-operation and Development] on how to improve international co-operation on cross-border tax evasion, but banking secrecy is not up for negotiation.

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The Luxembourg government cannot be taken with serious in the debate about banking secrecy. In a couple of days 3 contradictory messages were communicated.

On 3 February, Luxembourg Prime Minister Jean-Claude Juncker implied before Italian media he was open to discuss the abolition of banking secrecy with the European Commission.

On 20 February, Luxembourg minister for foreign affairs and immigration and Luxembourg's Deputy Prime Minister Jean Asselborn said in Switzerland that banking secrecy needs to be redefined, but abolishing it abruptly is not in Europe's interest

On 25 February, Luxembourg minister for justice and budget Luc Frieden said in Austria that Luxembourg and Austria were ready to take part constructively in a discussion in the EU and the OECD [Organisation for Economic Co-operation and Development] on how to improve international co-operation on cross-border tax evasion, but banking secrecy is not up for negotiation


Who is expressing the actual thought of the Luxembourg government on banking secrecy?

How the jurisdiction can it inspire confidence with the stakeholders all the more than some PSF are using professional secrecy in an abusive way in doing what will be called obstruction to justice in the USA?