2009 December » Tax Research UK

France stands by use of stolen bank data

Dec 212009

FT.com / Europe – France stands by use of stolen bank data.

France said on Sunday that it had committed no crime in using a stolen list of Swiss bank accounts to track French tax evaders as a row between Bern and Paris over banking secrecy intensified.

“France is committing no fraud, the tax evaders are,” said Eric Woerth, budget minister, in an interview on Canal Plus. “What counts is that we obtained [the information] legally.”

Quite so.

It’s extraordinary that tax evaders – common criminals guilty of theft – claim that the rule of law provides cover for their crime.

France has committed no crime.

And has an unpaid whistleblower who reports crime done more than breach contract? Unlike those he is reporting upon – both bank and tax evader – both of whom may have acted criminally?

The claim by Switzerland is a complete red herring. Of course France may use information obtained in this way.

Tory Treasurer’s company to pay $25m over SEC claims

Conservatives, Ethics Comments Off

Dec 212009

FT.com / Companies / Financial Services – Icap arm to pay $25m over SEC claims.

A US subsidiary of Icap, the UK broker founded and run by Michael Spencer, the Conservative Party treasurer, has agreed to pay $25m to settle allegations by the Securities and Exchange Commission in New York.

The SEC alleged that brokers at Icap, the world’s largest interdealer, used fake trades to encourage trading by customers.

Interdealer brokers match buyers and sellers in over-the-counter markets, such as government bonds and mortgage-backed securities, by posting trade information. Customers often use the level of trading activity to decide whether to place orders.

Oh dear, oh dear, oh dear.

The Tories really aren’t that good with cash, are they?

The Scottish Institute of Chartered Accountants backs campaign against tax avoidance

Accounting, Development, Ethics, Tax avoidance Comments Off

Dec 202009

ICAS executive director of technical policy, David Wood has added his voice to the campaign by Christian Aid against tax avoidance by companies working in the developing world.

View the video here.

It’s good to see a spokesperson for a professional institute standing up and being counted in this way.

I look forward to more joining him.

Basel blows out Deferred tax assets

Accounting, Banking 2 Responses »

Dec 182009

FT Alphaville ¬ª Basel blows out DTAs.

The Basel committee on banking supervision has ruled deferred tax assets are not part of a bank’s tier one capital that underpins their solvency.

That’s eminently sensible.

What is mad is that they ever were.

BofE official calls City’s bluff

Banking 2 Responses »

Dec 182009

FT Alphaville ¬ª BofE official calls City’s bluff.

A senior Bank of England official said that if some banks moved overseas in response to tougher UK regulation, “it might be a price worth paying” to protect vital financial system reform. The comments, by Andy Haldane, the Bank’s head of financial stability, in a BBC interview to be broadcast on Friday, will add to tensions between the authorities and the financial sector, which has already attacked the government’s new 50% bank bonus tax.

He’s got it right.

It is a price worth paying.

Nice to be a winner sometimes

Blogging 1 Response »

Dec 172009

A few weeks ago the Guardian announced a competition. The winner had to offer the best explanation for the complicated structuring of Tony Blair’s financial affairs.

And this afternoon I gathered I won.

So that’s small kudos and a rather nice Steve Bell cartoon coming my way.

The winning entry was this blog. Which may, or may not of course be the correct reason for the structure used, but which does, whatever else it says, not suggest he’s done anything wrong in structuring things as he has.

Using Tax Justice Network data for anti-money laundering risk assessment

86, Secrecy jurisdictions Comments Off

Dec 172009

As if to shatter stereotypes I gave an on-line one hour seminar to a group of US anti-money laundering officers and advisers this week, organised by a dynamic senior manager in Deloitte, New York.

Feedback suggest that they enjoyed what I had to say: I enjoyed leading the session. I also massively appreciated the chance to do so without ever leaving my office here in the UK.

The discussion was wide ranging, some of it quite technical (I am still a money laundering officer myself) but the focus was on how the data that TJN has created in its Secrecy Jurisdictions web site (well over 1,000 pages of it) could be used for anti-money laundering risk assessment purposes.

Risk assessment in that sector is in no small part based on available rankings. The OECD rankings play a role for example: so does Transparency International’s Corruption Perceptions Index. What was clear was that because the TJN work was a) rigorous and b) sourced in every case and c) could be aggregated (i.e. a risk score for a structure over a range of jurisdictions could be easily computed) it has considerable potential for use in this sector.

I admit that would probably need the database to be more easily accessible – for which we did not have funding. But it would be great to work with people keen to achieve that. If anyone wants to call, please do.

Myth: We need to pay high salaries to attract and retain talent in the UK

Economics 3 Responses »

Dec 172009

The following is from the New Economics Foundation report entitled A Bit Rich:

Myth: We need to pay high salaries to attract and retain talent in the UK

For this myth to be true a number of other myths must also be true: that the highly paid are first and foremost rational economic actors; that social mobility is a reality that rewards people’s talent and effort; and that there is perfect competition in the labour market. As we will show all of these assertions are on very shaky ground.

For this myth to be true, the best and brightest people in the UK would need to be in the most highly paid jobs. The best and brightest from across the world would need to be concentrated in a small number of countries that offered the most favourable conditions. Not only is this not true, but there doesn’t seem to be a reliable relationship between talent, entrepreneurship and income.

It would appear that according to a number of indicators, the reverse is in fact true. For example, there is a weak but significant tendency for more equal societies to gain more patents per head than less equal ones. More equal countries also feature heavily at the top of the list of the countries where the most books are published per head.66 Inequality, it could also be argued, wastes the talents of a large proportion of the population.

In a report for the Work Foundation, Life at the Top, the following insights were shared:

(1) Nearly 60 per cent of chief executives of FTSE-250 companies had worked in their firms for more than eight years, substantially above the average tenure of five-and-a-half years. This suggests that rather than there being a fluid market of top executives switching firms to capitalise on the best remuneration, companies nurture and retain their senior staff.
(2) Contrary to claims that the labour market for senior executives is global, 86 per cent of FTSE-250 chief executives are of UK nationality.
(3) While French and German chief executives are paid less than their UK counterparts, there is greater business productivity in France and Germany.

Finally, it is not possible to square the causes of this recession with the idea that we are hoarding talent in the UK. Gross incompetence at the top of many of our banks has been directly responsible for the calamity of late 2008. Surely this isn’t the best our money can buy.

It isn’t.