HMRC revisits offshore – and faces criminal non-cooperation

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PWC has reported that

HMRC held a meeting with representatives of up to 100 financial institutions on 25 September 2007 in connection with offshore evasion by UK bank customers holding offshore accounts.

HMRC's pursuit of suspected offshore evasion by UK bank customers with offshore accounts is now expanding in scope, beyond the five major UK banks targeted hitherto.

According to reports HMRC asked the financial institutions to complete a questionnaire which should enable HMRC to decide on possible TMA 1970 s20(8A) notices to enforce the supply of data on offshore accounts.

As PWC also noted though:

HMRC accepted the legal constraints faced by some banks with subsidiaries in countries with banking secrecy laws, such as Switzerland, Austria, Belgium and Luxembourg and that the Isle of Man also has laws which could impede disclosure.

There has been doubt as to whether HMRC could override foreign secrecy laws and force banks to disclose information held by a foreign subsidiary.

As the FT has noted,

The Revenue needs to find out whether information relating to offshore accounts is available, either because it is on a UK-based server or because UK bank officials are authorised to access information held abroad.

There's no doubt that if they don't the law is less clear than if they do.

But doesn't this give rise to one , obvious, point, that when bank secrecy is used to assist crime (and tax evasion is a crime) then those countries that provide it are parties to that crime, and so are those who defend the secrecy arrangements that they offer?

Try offering me an alternative explanation.