Transparency International smells the coffee

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The Tax Justice Network has been critical of Transparency International in the past. Our reason has been that its definition of corruption has been too narrow. Ours is available here. This debate has not gone away, but has been pursued quietly and diligently for some time.In that light it's enormously encouraging to read report of the interview the new head of TI gave to the FT, published today.

The new head of Transparency International has warned London and other global financial centres to expect "much greater pressure" from the corruption watchdog to tighten anti-graft and money laundering regulations.

Cobus de Swardt told the Financial Times in his first full interview since becoming TI managing director in June that corruption "facilitated by bankers and financial centres" had received too little attention by the global pressure group, but that this was changing.

Founded in 1993, TI was now entering a "second wave" of corruption campaigning focused more on the responsibility of western governments and companies for "perpetuating corruption in poorer parts of the world", he said.

Calling for more stringent government regulation of onshore and offshore financial centres, including New York and Singapore, he said: "It is a question of whether the legal requirements [on companies] as they exist now are sufficient to prevent illegal money or money from corruption to flow into the [international financial] system. We are clear that they are absolutely not enough."

He indicated that TI would lobby for specific regulations on shell companies -- and on western bankers, accountants and others working for them - that are used to hide corrupt funds.

That, and the fact that they will be wading into the extractive industries debate, is excellent news. Some of this language and that used in the rest of the article comes straight from Tax Justice Network.

But, TI have also got to tackle the flaws in the Corruption Perceptions Index because there's no way on earth Switzerland is clean, and everybody knows it.