The FT has reported:
This is significant. Without the credit card companies (Amex, Visa and MasterCard, in particular) then vast amounts of money laundering that takes place in the world as a consequence of tax evasion could not happen.
It is far too easy to secure credit card issued by one of these companies from a place like the Turks and Caicos Islands, issued on a bank account held by a company incorporated in another taxation, notionally controlled by nominees, and in turn owned by a trust with its own range of nominee professional trustees, with the ownership of that card being almost untraceable as a result. This has been the classic way in which tax evaders brought their money back into the mainstream economies.
It is abundantly clear that three things are required now, especially when people like AMEX are seeking state support:
1) The quoted credit card companies I note above must make available lists of all credit cards issued using their authority in all locations in the world to all tax authorities who ask with regard to those taxable in their domain unless there is a risk of human rights abuse as a result, which should be adjudicated by a court. Unless these companies can identify the warm human beings that will actually use these cards, and have proof of identity and proof of their real place of residence, they should be debarred from issuing any further cards.
2) Those who process credit cards will also require proof of identity, such as airlines and hotels, must be required to make available their card processing data to ensure that those using accounts issued in tax havens but who are resident in mainstream economies can be identified.
3) Credit cards must be subject to international regulatory supervision. This should also be extended to on line payment systems such as PayPal, whose location in Luxembourg is not an endearing quality in this regard.