12/22/2007
FATF: breach in the independence
Let's analyse the latest report published in the French version of the website (Annual report 2006-2007).
18ème rapport annuel du GAFI - 2006-2007
20-déc.-2007
Depuis sa création, le GAFI dirige au niveau mondial la lutte contre le blanchiment de capitaux, et, depuis une époque plus récente, le financement du terrorisme. Cette dix-huitième année a été marquée par l'accomplissement d'importants progrès réalisés par le GAFI et ses partenaires.
For the English-speaking readers of this blog this means "Since its creation, the FATF has been managing at the worldwide level the fight ainst money laundering and mopre recently the financing of terrorism. This eighteenth year was marked by the achievement of important progress done by the FATF and his partners".
Paragraph 56 page 20 wants commenting. It states "Grâce à un don généreux du Luxembourg, le GAFI améliore ses systèmes informatiques, afin d’offrir à ses délégations un meilleur accès aux documents confidentiels. Ce système sera renforcé au cours de l’année à venir et le GAFI sera alors en mesure d’améliorer son site Internet ouvert à la consultation du public". For the English-speaking readers of this blog this means "Thanks to a generous gift by Luxembourg the FATF is improving its IT systems to offer to its delegates a better access to confidential doccuments. This system will be reiforced in the coming year and the FATF will be able to improve its website opened to public consultation".
We are not talking about the annual members' contribution as explained paragraph 57.
The report underline a GENEROUS GIFT by a jurisdiction where professionals focus on the growth and do not care of business ethics as demonstrated by the restrictive vision of CSR, which is limited to private sponsorship and may be a kind of money laundering.
The report underline a GENEROUS GIFT by a jurisdiction where, according to Transparency International, 6 % of respondents reported they paid a bribe to obtain a service.
The FATF is visiting Luxembourg next year. Some might see in the GENEROUS GIFT an attempt to be in the FATF's good books at a time when many people realise the strong gap between the legal and regulatory framework and
1) what is enforced
2) and even the FATF Recs.
Let's imagine what would be said should one discovers that an auditee would give a GENEROUS GIFT to its auditor !!! Even though the fact is public in the report, the FATF should not accept such GENEROUS GIFT on the principle, as such behaviour definitely weakens its credibility.
I am sad to see that neither Luxembourg nor the FATF are aware of that.
08:40 Posted in Luxembourg | Permalink | Comments (0)
FATF : english version v. french version of the website
When looking the FATF website it is amazing to observe that the page for English-speaking visitors is not the same as one for French-speaking visitors.
Lasts events for English-speaking visitors:
- 24-Oct-2007 - FATF third mutual evaluation report of Finland adopted by the FATF plenary in June 2007.
- 15-Oct-2007 - Guidance Regarding the Implementation of Activity-Based Financial Prohibitions of United Nations Security Council Resolution 1737
Lasts event for French-speaking visitors:
- 20-déc.-2007 - 18ème rapport annuel du GAFI - 2006-2007
- 16-oct.2007 - Lignes directrices relatives à la mise en oeuvre des interdictions financières liées aux activités couvertes par la Résolution 1737 du Conseil de Sécurité des Nations Unies
The web site is not controlled so money laundering is not controlled by the perfectible functioning of the FATF.
07:36 Posted in General | Permalink | Comments (0)
12/19/2007
GDP per inhabitant in Luxembourg is the highest in Europe
According to Eurostat GDP per inhabitant in Luxembourg, expressed in terms of purchasing power standards 3 (PPS), was more than two-and-a-half times the EU27 average in 2006, while Ireland was nearly 50% above the average. The Netherlands, Austria, Denmark, Sweden and Belgium were between around 20% and 30% above the average. The United Kingdom, Finland, Germany and France recorded figures between 10% and 20% above the EU27 average, while Spain, Italy and Greece were around the average.
The critical question is : to what extent the exceptional figure may result of dirty money in the local economy thanks to proved public or official lax behaviours and poor enforcements of rules that are the visible part of the iceberg?
As I already wrote, to determine wether a country is a tax haven or not, attractive banking or tax regulations are necessary conditions but not sufficient. The point is permissiveness that facilitate the growth.
The leader of the audit in Luxembourg is unfortunately in an awkward position with the IFAC by promoting the growty without ethics. Let's read again what IFAC Deputy President Robert Bunting said on the importance of the tone at the top in finding the right balance between governance, oversight and business growth: "If the CEO’s message is aggressive growth and ‘make the numbers’ first and foremost, then the organization will reflect those priorities. If the CEO emphasizes transparency and integrity, as well as performance, then the organization will respond accordingly". Let's read the latest press release about the growth and what the Territory Senior Partner said early 2007 : "We evolve in a business model based on growth, it remains a preference.". I alredy said a couple of words about the latest press release about growth without ethics.
What is true a the level of a firm is true as well at the level of a financial center: If the communication is aggressive growth and ‘make the numbers’ first and foremost, then the center will reflect those priorities. If the communication emphasizes transparency and integrity, as well as performance, then the center will respond accordingly.
In Luxembourg the communication is definitely aggressive growth and 'make the numbers' in a lax environment.
08:05 Posted in Luxembourg | Permalink | Comments (0)