They’re very confused in the Channel Islands

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Deeply confusing and contradictory messages are coming out of the Channel Islands.

Guernsey has submitted its evidence to the Treasury Select Committee hearing on Offshore Financial Centres and says Guernsey is

* An effective regulatory regime that meets or exceeds international standards on financial regulation, anti-money laundering and controlling the financing of terrorism;
* International co-operation on regulation and the investigation of financial crime;
* Competitive taxation and certainty in its taxation system; and
* Regular, external and independent reviews - in the majority of cases at Guernsey's express invitation and in all cases with Guernsey's full co-operation and assistance.

It's the usual misinformation based on the existence of a rule book that is then ignored with which we are all now familiar.

No doubt Jersey is saying much the same sort of thing, but in its case the evidence might be a little undermined by a story reported in the Jersey Evening Post yesterday which said:

A £100,000 public relations campaign is being planned to 'correct misconceptions' about the Island's finance industry.

What's the misconception that needs correction? It's this:

The problem has arisen because Jersey is in the process of signing up to Tax Information Exchange Agreements with a number of other countries and has already done so with the United States and the Netherlands.

Jersey Finance says that some competitor jurisdictions, in particular Switzerland, have been using this to their competitive advantage to create negative publicity about the Island's alleged lack of banking confidentiality.

Economic Development Minister Philip Ozouf said

We are facing particularly strong competition from Switzerland. But in fact we have excellent banking privacy in Jersey.

So which is right guys? Or you open, accountable and transparent, or are you providing the secrecy to harbour crooks and tax evaders? I think the allocation of £100,000 to the second option suggests what is really important in these places.

Nothing has changed. And anything and everything these people say to the Treasury Select Committee when their turn comes will have to be seen as simple misinformation. By following the cash you find the truth. And it's not very attractive in this case.