The Guardian has reported that:
France has cast doubt on claims by a Conservative minister and tax office boss Lin Homer that the UK was refused permission to use the leaked HSBC files to pursue financial criminals through the courts.
When challenged about the British government's failure to take action against the bank or criminal clients, Homer told parliament the UK's hands were tied by treaties with France, which restricted use of the HSBC data to pursuing tax evaders.
She said HMRC had only been given permission by the French on Monday to take on more serious cases such as money laundering. Her claims were repeated by the Tory Treasury minister David Gauke to the Commons on Monday.
But France's finance minister Michel Sapin has rejected the British version of events.
If that is true and if it transpires HMRC never sought to check for five years then I think it has to be game over for Lin Homer.
You can't mislead parliament like that and hope to survive.
There has to be a chance for clarification, of course, but the need for facts to be laid on the table has come and if Homer's story does not stack then it will be resignation time.
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This certainly does need clarifying. I thought David Gauke told us that HMRC were specifically *not* allowed to use the HSBC information to investigate money laundering.
I heard that Cameron has cut down the Tax Avoidance dept at HMRC to just four people.
That is untrue
Not everything said in the pub is right
The element I picked up in the Guardian was: “Homer told parliament the UK’s hands were tied by treaties with France, which restricted use of the HSBC data to pursuing tax evaders”.
Reasonable people would then say: OK which elements in the “treaty”, exactly, restrict the use & how, exactly, is use restricted & how would these restrictions make going after “!tax dodgers” (for want of a better phrase) more difficult. The overall timbre of Mrs Homer’s evidence was “oh dear this is all so very difficult”.
This contrasts with one of my oldest friends who had a “file” started on him by the old Inland Revenue back in the 1970s – it is now used for “training purposes” – “there you go – see if you can find anything in that”. My friend is a man of very modest means – which of course means that he is an easy target for HMRC.
Was the information exchanged under the UK-France double tax treaty? http://www.hmrc.gov.uk/taxtreaties/in-force/france.pdf
See Article 27(2): “Any information received under paragraph 1 by a Contracting State shall be treated as secret in the same manner as information obtained under the domestic laws of that State and shall be disclosed only to persons or authorities (including courts and administrative bodies) concerned with the assessment or collection of, the enforcement or prosecution in respect of, or the determination of appeals in relation to, the taxes referred to in paragraph 1, or the oversight of the above. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions.”
Does money laundering count as “the assessment or collection of, the enforcement or prosecution in respect of, or the determination of appeals in relation to, the taxes referred to in paragraph 1, or the oversight of the above”?
Tax evasion is an AML predicate offence (as I recall)
S0 my answer is, yes
What part of “the assessment or collection of, the enforcement or prosecution in respect of, or the determination of appeals in relation to, the taxes” stops HMRC from prosecuting HSBC and their staff for conspiracy to cheat the revenue or assisting in tax evasion? The money laundering point is simply a red herring at best.
See “Argentina charges HSBC with aiding tax evasion via Swiss accounts”
http://www.reuters.com/article/2014/11/27/us-argentina-hsbc-idUSKCN0JB2AA20141127
See also “HSBC charged in Belgium over money laundering, tax fraud”
http://uk.reuters.com/article/2014/11/17/uk-hsbc-belgium-courts-idUKKCN0J119H20141117?feedType=RSS&feedName=businessNews
Richard
This came into force on 1 January 2013
Declaration of the United Kingdom concerning the acquisition of customer data stolen from Swiss banks:-
The Government of the United Kingdom declares on the occasion of the signing of the Agreement between the United Kingdom of Great Britain and Northern Ireland and the Swiss Confederation on cooperation in the area of taxation that it will not actively seek to acquire customer data stolen from Swiss banks.
Is this the reason why HMRC is not being pro-active? But begs the question on which side is HMRC on?
As TJN and i have long argued, not on the side of beating tax evasion in these cases
Over the last five years I have been increasingly incredulous at how easy it is to mislead Parliament in this way and remain at liberty.
It is worth pointing out that the Chair of the BBC, Rhona Fairhead, herself an HSBC Director with (at the time) responsibility for compliance also needs to start answering questions (rather than refusing to comment) about her role in the events. Especially as the fines imposed by the US for money laundering also happened on her watch.
Agreed
I cannot see how she is fit for that role at present
An HSBC bod in the upper echelons the BBC?
If true, that is totally unacceptable in my view.
It is true
She has form. From Wikipedia, but all covered in Private Eye long ago: In 2013, Homer’s tenure at UKBA [Border Agency] was criticised for its “catastrophic leadership failure” by the House of Commons Home Affairs Select Committee, which said it had been repeatedly misled by the Agency. Committee chairman Keith Vaz said her performance was “more like the scene of a Whitehall farce than a government agency operating in the 21st century”.
To be honest with you, the pay that Ms Homer is on probably relates to the merde she has to deal with in order to keep the HMRC as toothless as possible so that the Government can protect its friends in high places.
So what I’m saying is that these highly paid people in the public sector who are effectively making services underperform don’t have to be good leaders anymore – just compliant with their political masters’ strategies.
It’s a real shame.
Mark Crown is right, I used to work in HMRC and none of the staff were impressed by the quality of leadership in HMRC, no surprise that in the annual staff surveys HMRC was bottom in the whole of the Civil Service for its staff engagement scores.
We now have a situation where if a member of the public wished to complain about the reportage, by the BBC, of the HSBC tax scandal under the watch of Mr Hartnett, that complaint would ultimately end up on the desk of Rhona Fairhead, a director of HSBC and, as such, a colleague of the former head of HMRC in his current role of advisor to HSBC. So no conflict of interest there then!
I wouldn’t go so far as to say ‘you couldn’t make it up’ (I can easily imagine Joseph Heller or Franz Kafka making it up) but it highlights the dystopian nature of what we regard as politics and society today.(For anyone, that is, that wasn’t paying attention during the débacle of the CSA inquiry).
It is also yet another example of how the ‘revolving door’ and the ‘old boys (and girls) network have been allowed to undermine the independence and integrity of every single state institution in the UK. Changing a system that has been nearly 1100 years in the making will take nothing short of a complete root and branch purging of the mechanisms of power in this country.
Given that almost no organisation in the country has emerged from the seemingly never ending list of improprieties that have hallmarked the last 15 years it becomes increasingly clear that that will only ever happen if we have a new political entity, one that hails from beyond the traditional pathways to power, and that stands in deference to no-one but the people.
It’s that or radical reform of systems to clean out the mess we have
My hope is for reform of either sort or of another we cannot anticipate as yet