The Jersey Evening Post published an article on Monday quoting me that was riddled with errors. It said:
A CRITIC of the Island's finance industry claims Jersey is deliberately making life difficult for overseas tax authorities by sending out ‘useless' information in response to requests for assistance.
Mr Murphy, a director of pressure group Tax Justice UK, says he has heard ‘rumours' from contacts in major states that the quality of information sent from Jersey to other nations can be delivered in a format that gives no help to investigators
However, such claims have been rejected by the chief executive of Jersey Finance, Geoff Cook.
He said that a review of Jersey's responses to requests for exchange of information conducted by the OECD's Global Forum on Tax Transparency and Information Exchange had concluded the Island reacted in a ‘responsive and co-operative' manner.
Rather more followed in the paper itself.
Let's point out the first obvious error: I am (and made it clear I am and was speaking as) the director of Tax Research UK. The paper could not get that right.
Then it says that I said the rumours I had heard referred to Jersey: I did not say that.
What did happen was that I was interviewed by BBC Radio Jersey who wanted to know why I thought Jersey might have been put on the French blacklist of non-cooperative tax havens.
I suggested a number of reasons that illustrated what I thought were part of what has been called b Dr Atul Shah 'constructive non-compliance' - that is appearing to play the game in accordance with a set of laws but actually doing all you can to undermine their purpose. Jersey will, of course, be very familiar with the technique which also underpins much tax avoidance.
When asked to give an example I gave one that I had heard has been happening from what I consider to be reliable sources. This is that at least some tax havens are assembling the information they need to supply to other countries under agreements such as the European Union Savings Tax Directive and are then printing it, and then photocopying the print and then sending that photocopy of the print to the recipient state. The intention is obvious; this means that the information supplied is not useful data and would have to be completely re-keyed to be of any use, which most states will not, of course do. As a result the whole purpose of information exchange is undermined - hence 'constructive non-compliance'.
That this happens is, I am sure, confirmed by many statements from minsters and others over recent years expressing their concern that if automatic information exchange were extended to developing countries they would have no capacity to deal with boxes and boxes of data that would be sent to them. That makes clear that the ministers know boxes and boxes of data are being sent to existing information exchange partners. No one has, however, ever intended that automatic information exchange be paper based: the idea is ludicrous and the OECD has spent a lot of effort making sure that suitable electronic file formats are available for it to take place but some states are clearly not using them.
What I said to the BBC and the JEP was that I was sure this was happening. I did not say I knew Jersey was doing it. But if France had listed Jersey as non-cooperative and had not done the same to Guernsey and the Isle of Man there had to be differences in approach between the places. It was up to the journalists in question to ask if this was one.
Harry McRandle on the JEP has instead suggested I said Jersey was doing this. I wish to put the record straight: I do not know it is. I mooted the possibility as I am sure some places are, and that's very different.
But it does not change the fact that I ma quite sure that Jersey is constructively non-compliant, that France is right to say so and that David Cameron's comments that the UK now had no tax havens is completely absurd.
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Dear Mr Murphy.
I have read your http://www.taxresearch.org.uk/Blog/2013/09/11/a-correction-to-the-jersey-evening-posts-misquotations/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+org%2FlWWh+%28Tax+Research+UK+2%29
blog with incredulity this morning.
I completely reject the key assertion of inaccuracy.
For example, I repeatedly asked if the ‘rumours’ referred to Jersey as I was not sure whether that is what you meant or not.
After asking you on a number of occasions, you clearly stated Jersey was a territory your ‘sources’ referred to. I have a contemporaneous note of that conversation.
Do you tape your conversations Mr Murphy? I was not sure whether you did or not. Therefore, I wanted to be careful in what I deduced from our conversation.
So I would say clearly that your recollection of our conversation is different from mine and from that of my notes.
I accept I called your pressure group Tax Justice rather than Tax Research. And for that minor transgression I am content to apologise.
But I am clear that the rest of the story was properly reflective of what you said.
I do find the position you are taking somewhat. You have either been told Jersey is doing what you claim or it is not.
It is surely disingenuous to say that you are being told some jurisdictions are engaging in such practices and then commenting on Jersey’s approach.
Your approach clearly links the island to something you now say that you cannot be certain the Island is responsible for.
It would be helpful to know which one it is Richard.
Harry
My statement today is wholly accurate and what I said to you and the BBC – to whom I had spoken beforehand.
I was quite clear in what I said – as I was to the BBC. It was you who pushed me to say I had heard this of Jersey – several times – but I did not confirm that. I made clear I had heard it happened – and it could be a reason for Jersey being considered non-cooperative – and that it was an example of ‘constructive non-compliant’ behaviour – but I did not say it was definitely the case of Jersey
Your conclusion that I said this was the definite case of Jersey was wishful thinking on your part.
I suspect that arose because you eventually got frustrated asking me the same question I would not say yes to and so instead asked me if I knew tax authorities had suffered information exchange problems with Jersey – to which I could give the unambiguous answer of yes, I could. But it was a different question and so a different answer I said yes to.
But I did not say that any more to you about Jersey supplying photocopies than I said on the BBC – and I was very careful in each case.
Sorry – but your report is wrong and that is why I have said so. My suggestion was careful and clear – you inferred what you wished to hear.
And as for the suggest I might have been disingenuous – well Harry, I just have to say that made me laugh. But it’s also the last thing you can accuse me of – the spin was all your own
I’m not sure if you’re both idiots or not. The press do spin stories to suit the headline, that’s probably the only thing Mr Murphy and I would agree on.
I would love to hear your reaction to the PM’s statement in Parliament this week stating it would now be ‘unfair’ to label Jersey, amongst others, as a tax haven. Clearly this puts you at odds with the PM, and Government, no? I would be grateful to hear your response to the PM’s now changed stance, no doubt as would most of us readers of the JEP.
I do hope you post this Murphy (and your response) but I am content if you do not.
I think the reaction I have made is well documented on this site
I think it safe to expect that Harry will deliver his paymaster’s line – he knows how to keep Geoff happy
Tx, I had posted here before seeing your other post on the subject.
I’m not the JEP’s biggest fan either but you’re both guilty of spinning your stories to suit your own agendas so I am minded to take both explanations with a pinch of salt.
All in all, I’m just pleased to see the PM support these British jurisdictions and to acknowledge that the AML, tax and other legislation that these states have in place already. And to acknowledge the work FATCA and the IMF have done reviewing our policies and systems and acknowledging that they are in some parts of a higher standard than the majority of the G20. I am mainly referring to Jersey with that latter comment since this is my area of expertise but I have varying degrees of knowledge on most IFC’s (or tax havens as you guys refer to them as).
I emplore you to continue your ‘good’ work but I would suggest that it may be about time to re-review your own data on these places to ensure it is up-to-date with the current system. Many of us attain to the highest standards of corporate governance and compliance, and I believe ‘us’ constitutes the majority here, and it would please us to see your future comments about Jersey more balanced to reflect the reality of what goes on in our finance industry.
I think I’d quite enjoy some good debate with you Mr M in the real world, but I’m not sure I could handle you for more than 5 minutes. By all means let’s hang those jimmy carr related service providers out to dry but let’s keep our heads held high about the good work we do also.
The current system in Jersey is the one that does not work
Everything else is promises
I work on facts
I think if you look at Jersey’s GDP, you’ll see it is working just fine and likely to continue now without hindrance…
You talk about facts but you present none?
I know Jersey’s GDP (actually, GNI) data
I wouldn’t boast if I was you
That’s the perfect example, how you dodge the q’s that call upon you to evidence your claims…
My evidence is the GNI figure you refer to (2010, no?). That’s a healthy number for a small island…
I wasn’t boasting, this is very probable now with the PM ‘on board’ so to speak. Governments around the world will begin to trust Jersey and the like again. The question of whether we are a tax haven can now be responded to with the line ‘David Cameron, and thus the Government, says we are not’… you can watch it as it happened here http://www.jerseyfinance.je/news/jersey-not-a-tax-haven-says-pm-david-cameron#.UjOiXhaSRSU
You’re wrong on this one Mr M. I’m sure there’s some shit still about but people have the right to privacy and to keep their wealth as they see fit as long as they stay within the confines of the law. Governments and lobbyists must amend policies to effect change. It’s the only way.
The Jersey GNI represents, in no small part, profits extracted from other states
Is that healthy?
As for Cameron – even the JEP have printed my response. You’ve missed it. How well informed are you?
It would seem that so many years of doublespeak have left Jersey incapable of distinguishing facts from fiction!