Posts Tagged ‘International News’
09.09.09 Proposed amendments to Jersey’s Anti-Money Laundering Legislation
Posted by: BTC in International News on September 9th, 2009
The Jersey Financial Services Commission has published a consultation paper concerning proposed amendments to the ‘Money Laundering (Jersey) Order 2008’.
The Money Laundering (Jersey) Order 2008’ requires Regulated businesses to apply policies and procedures for the prevention and reporting of money laundering. These include policies and procedures for customer due diligence, record keeping, and reporting ‘suspicious activity concerning money laundering and terrorist financing.
Businesses that form the regulated sector include banks and financial institutions, money service businesses, trust and company service providers, law firms, accountants, and estate agents.
This amendment order has been made necessary in the light of some technical points that have been raised in a recent review of the Jersey framework for the prevention and detection of money laundering and terrorist financing conducted by the International Monetary Fund (IMF).
Among the proposed amendments, the paper also considers the possibility of extending powers to the Minister for Treasury & Resources to apply countermeasures where the Financial Action Task Force (FATF) issue recommendations. This may in be respect to countries or regimes that have weak or nonexistent anti-money laundering and the combating of terrorist financing legislation.
The Jersey Financial Services Commission explained on Monday that the main effects of Amendment No. 4 would be to:
- Clarify the application of customer due diligence measures to trusts and other legal arrangements;
- Clearly set out the records that a Money Laundering Compliance Officer and Money Laundering Reporting Officer must have access to in order to carry out their statutory functions;
- Require particular attention to be paid to implementing policies and procedures that are sufficient to prevent and detect money laundering and terrorist financing in subsidiaries and branches that are situated in countries and territories that do not, or insufficiently apply, the Financial Action Task Force Recommendations;
- Restate the requirement that customer information must always be collected before a relationship is established – where a customer is introduced by one business to another; and
- Amend the scope of some of the concessions that may be used when applying due diligence measures to a customer who is considered to present a low risk of money laundering or terrorist financing.
The proposed amendments have been discussed with the Commission’s Steering Group for the Prevention and Detection of Money Laundering and Terrorist Financing.
Visit the BTC website for compliance help and support for firms in the regulated sector
04.09.09 Netherlands Concludes TIEAs With Caribbean Islands
Posted by: BTC in International News on September 4th, 2009
In a further tightening of the net for international tax evasion, the Netherlands Ministry of Finance has announced the signing of tax information exchange agreements (TIEAs) with three Caribbean territories.
The agreements with St Kitts and Nevis, and the TIEAs with Antigua and Barbuda and St Vincent and the Grenadines, were all signed on the sidelines of the recent OECD forum.
The conventions contained with the agreements, will allow the exchange of fiscal information between the tax authorities in the case of tax crimes, and in civil tax matters.
The Netherlands Ministry of Finance noted that the agreements marked a significant step in combating tax evasion, fraud, money laundering and the financing of terrorism, as cooperation between the Netherlands and the Caribbean islands will be significantly enhanced with regard to tax matters.
The Dutch Finance Ministry revealed that it had also reached agreements for the text of further TIEAs with two more jurisdictions, namely, the Cook Islands and Samoa and that it also expects to sign a double tax treaty with Bahamas that will incorporate the internationally-agreed standard in due course.
Visit the BTC main site for more information of money laundering compliance in the regulated sector.
31.07.09 Serious organised crime review published
Posted by: BTC in General News & Cases, SOCA - Latest News on July 31st, 2009
The Government’s new strategy for tackling serious organised crime, entitled Extending Our Reach: A Comprehensive Approach to Tackling Serious Organised Crime, has been published.
The strategy endorses many of SOCA’s current ways of working, including by seeking to cement a collaborative approach and to embrace wide-ranging tactics.
The strategy’s four main aims are to:
- ensure that all organised criminals are within our reach, using non-traditional techniques to create an improved intelligence picture and supporting the principle of lifetime management;
- use whatever tools have maximum impact, prosecuting when possible but also going further into using non-criminal proceedings, including to recover finances and assets;
- enable all of Government to play its part, including by strengthening the criminal justice system approach and using the powers of agencies outside law enforcement to combat organised crime together;
- maximise collective efforts overseas, and to work closely with the private sector and with the public.
Speaking at the launch of the strategy, SOCA Executive Director David Bolt said:
“Organised crime is constantly evolving, as is law enforcement, and five years after the publication of ‘One Step Ahead’ this is a timely and appropriate response. Our intelligence on organised crime has improved significantly, and we have new powers, the effects of which are starting to be felt. At the same time there are new opportunities for criminals, and law enforcement has to keep working to stay ahead”.
The Review is a strong endorsement for the approaches SOCA has been pioneering, and looks to extend those approaches more widely. For example, every SOCA investigation involves a financial investigation; we are making use of Serious Crime Prevention Orders and Financial Reporting Orders; we work with non-law enforcement partners and the private sector; we work with prosecutors to ensure that the best line is taken in every case; and we are exploring the potential for greater data sharing and matching. We know that other countries look to the UK as leading the field in many of these areas.
Through SOCA’s operational efforts in its first three years we have been able to identify over 5,000 individuals involved in organised crime at a level that makes them of interest to us. The people we are concerned about are mostly lifetime criminals. Some are overseas, some are in prison, but once they are in our sights we do not let go. We recognise that it is not a matter of dealing them a single blow and that we have to keep up our attack. As a result, it is likely that the number of people on our radar will continue to grow.
The main principles of the new strategy are sensible: all organised criminals within reach; all approaches considered; all of government playing its part; all partners at home and overseas engaged. We particularly welcome the specific remit the Review gives to other government departments and agencies: this is not just for the Home Office and law enforcement to deliver. Collaboration is the key. This is something SOCA has always promoted – the legislation that set us up designed us to operate on that basis.
Visit the BTC website for compliance help and support for firms in the regulated sector.
18.06.09 Taliban, Al Qaeda finances recovering
Posted by: BTC in General News & Cases on June 22nd, 2009
Investigation shows Taliban in Afghanistan and Pakistan get money from extortion, crime and drugs.Taliban refer to extortion money as tolls, taxes or zakat
PESHAWAR: For the Taliban in Afghanistan and Pakistan, money is coming mostly from extortion, crime and drugs, an AP investigation claims
Funding for the Al Qaeda is more diverse and included money from new recruits, donations from sympathisers, and a cut of profits from honey dealers in Yemen and Pakistan.
“With respect to the Taliban, the narco-dollars are a major, if not majority, of their funding sources, and I think add in there as well extortion and kidnapping,” said Juan Carlos, a former US National Security Council adviser on terrorism who now works at the Centre for Strategic and International Studies in Washington.
Afghanistan produces more opium than any other country in the world. The Taliban charge drug kingpins to move the opium through their territory. The United Nations estimates their annual cut to be more than $300 million.
‘Taxes’: The Taliban refer to extortion money as tolls, taxes or zakat. Money from drugs and criminal gangs makes up roughly 85 to 90 percent of Taliban revenue, estimates John Solomon of the US Military Academy’s Counter Terrorism Centre. In Pakistan, the NWFP governor puts the Taliban’s annual earnings at roughly Rs 4 billion.
Taliban soldiers are paid nearly $100 a month, more than the average Pakistani policeman. A Taliban commander gets more than $350 a month.
The informal money transfer system known as hawala or hundi is flourishing in Pakistan and Afghanistan as well as the US. Former prime minister Shaukat Aziz said more than $5 billion went out of Pakistan every year through this system, which operates without regulation.
In three of the last five years, the top source of money transfer into Pakistan through hawala has been the US, a security official said.
After September 11, 2001, the financial crackdown closed some of Al Qaeda’s sources of funding. But with the help of the hawala system, it has since re-established its money line.
Over the last two years, it has turned up the call for donations, told new recruits to bring money with them, and shown signs of being more frugal. This can either mean that it is saving up for another 9/11-style attack, or that the crackdown has curbed its fundraising ability.
Estimates of Al Qaeda’s annual spending vary wildly from $300 million to as low as $10 million.
Carlos said its main expenses were payments to families; food and shelter to maintain operations; travel and logistics; money for cells engaged in plots; bribes, and expenses for long-term plans like anthrax research.
Some charities with alleged Al Qaeda connections have renamed themselves. In Kuwait, the Revival Islamic Heritage Society, believed by the US to be heavily financing Al Qaeda, is still operating.
Because of demands from the International Monetary Fund, Pakistan has removed restrictions on the amount of money that can be brought into the country. It has limited to $10,000 the money that can leave the country, cracking down on some of the biggest hawala dealers.
“Once the money is inside the country, it is difficult to locate it. Smugglers and transporters help finance the Taliban either out of sympathy for their cause or because they are being forced to give a share,” said a security official.
A cartel of honey dealers is back in business, laundering money and moving drugs but the scale is smaller than in 2001.
A former fighter with Gulbuddin Hekmatyar told AP honey is sent from Pakistan with an inflated price tag to markets in the Middle East and the profits sent by courier to Al Qaeda.
Honey dealers in Peshawar said that there was no Al Qaeda link to their sales. But one honey dealer said the outlawed Al Shifa Honey Press was still operating in Punjab. He said he knew of no Al Qaeda affiliation
Visit the BTC website for compliance help and support for firms in the regulated sector
18.05.09 Tax haven crackdown to hit offshore financial centres
Posted by: BTC in General News & Cases on May 18th, 2009
The number of offshore financial centres could shrink by half within the next five years as the worldwide crackdown on tax havens gathers pace, according to a prominent Jersey-based financial lobbyist.
Geoff Cook, chief executive of Jersey Finance, a promotional body representing the financial services industry on the Channel Island, said: “It is not inconceivable to think that the number of offshore finance centres could fall by half in the next few years.”
Cook was responding to a question on the future of offshore centres at a conference hosted by Jersey Finance in London last week. The Paris-based Organisation of for Economic Co-operation and Development lists 38 jurisdictions as tax havens.
These include Jersey, the Cayman Islands and Liechtenstein, and less well-known and small jurisdictions such as the Caribbean islands of Aruba and Montserrat and Nauru in the Pacific.
Cook and others reckon smaller offshore centres will feel pressure to meet increasingly tougher regulatory and disclosure rules from international organisations and governments demanding greater transparency.
Tax havens are being forced to sign anti-secrecy agreements, or face possible sanctions from G20 countries. An estimated $7 trillion (€5.2 trillion) of assets are held offshore and, according to pressure group Tax Justice Network, developed countries lose $180bn a year in evaded taxes.
Jay Krause, a partner at law firm Withers, said: “The next stage of development in international information sharing in tax matters will likely focus on establishing ‘automatic’ information exchange between jurisdictions.
Such procedures may in practice be challenging for some of the smaller offshore centres to implement.” Currently, Most offshore centres only disclose information on accounts when there is a specific request from another country that has signed a tax information exchange agreement with the tax haven.
Krause added that smaller offshore centres will also struggle to attract the required talent to defend themselves against regulatory pressures.
Visit the BTC website for compliance help and support for firms in the regulated sector.
11/03/09 Brown and tax havens – Treat ‘em mean
Posted by: BTC in General News & Cases on March 11th, 2009
Editorial: The Guardian
However slowly, however piecemeal, progress is being made in forcing tax havens to become less secretive. Yesterday it was the turn of Jersey to sign an agreement with the UK that it will share information about offshore tax payments. Gordon Brown has been sounding tougher too. In his address to US Congress last week was this remarkable sentence: “How much safer would everybody’s savings be if the whole world finally came together to outlaw offshore tax havens?”
An excellent question, even if the person raising it comes as rather a surprise. This is after all the same Gordon Brown who barely did anything about tax havens during his decade as chancellor. Indeed, while Mr Brown was in Number 11, the International Monetary Fund effectively branded Britain a tax haven on account of its lax rules on rich non-domiciles. Sinners can repent, of course, but to be truly convincing they must reform. And of that there is not yet enough evidence. The tax-information exchange agreement with Jersey may be less significant than it appears. Seasoned campaigner Richard Murphy observes that the Cayman Islands, which has a similar agreement with the US, only budgets for around 120 enquiries a year. That is a tiny number considering how much money flows between the US and the Caribbean tax haven. Nor are the UK authorities being quite as tough as they make out. When officials discuss the agenda for next month’s G20 summit, it is clear that they are relying on others – whether that be the US, Germany or France, or the rich-countries club of the OECD – to take the lead in the havens debate, with the UK following some way behind.
So any optimism must be heavily qualified – but there should still be optimism, for three reasons. The first is that the political climate is different. The US now has a president who is determined to crack down on tax havens, and the financial crisis has emboldened those European leaders who have long wanted action. Mr Brown has cover for his new-found radicalism. The second is that the financial crisis is helping to make the case against offshore tax dodging. As officials and expert outsiders are able to examine the detritus of the securitisation boom, they are finding strong evidence of how much of it was driven by the tax advantages of using offshore havens.
Finally, there is an economic imperative – governments are spending vast sums, even while their revenues are being hit by the recession. The search is on for more ways to raise cash, even if that means a shake-down of tax havens. A fairer tax system is not inevitable, but the conditions to create one could not be more propitious.
Visit the BTC website for compliance help and support for firms in the regulated sector.
25/02/09 India poised to have FATF entry approved
Posted by: BTC in International News on February 25th, 2009
New Delhi: A Bill aimed at effectively combating money-laundering, terror financing and cross-border economic offences was passed by Parliament on Tuesday, with the Lok Sabha approving the measure.
The Prevention of Money Laundering (Amendment) Bill, 2009, passed by the Rajya Sabha last week, seeks to ensure a legal framework to check such crimes. Winding up a discussion on the Bill in the Lok Sabha, minister of state for finance PK Bansal assured the House that the government would not be found wanting in taking action against those indulging in money-laundering. The new law seeks to check use of black money for financing terror activities.
Financial intermediaries like full-fledged money changer, money transfer service providers such as Western Union and International Payment gateways, including VISA and MasterCard have also been brought under the ambit of The Prevention of Money-Laundering Act.
Consequently, these intermediaries, as also casinos, will be brought under the reporting regime of the enforcement authorities. It would also check the misuse of promissory notes by FIIs, who would now be required to furnish all details of their source.
Bansal said the Act would check misuse of “proceeds of crime” be it from sale of banned narcotic substances or breach of the Unlawful Activities (Prevention) Act.
The passage of the Prevention of Money Laundering (Amendment) Bill, 2009 will enable India’s entry into Financial Action Task Force (FATF), an inter-governmental body that has the mandate to combat money laundering and terrorist financing.
The Bill, after becoming an Act, will address India’s international obligation and empower the enforcement directorate to search the premises immediately after the offences are committed and police have filed a report.
Visit the BTC website for compliance help and support for firms in the regulated sector.
12/02/2009 14,000 tax avoidance schemes and counting…
Posted by: BTC in General News & Cases, HMRC News and Guidance on February 12th, 2009
At the last count, since rules requiring the disclosure of tax avoidance arrangements to HMRC were introduced in 2004 there had been around 14,000 such schemes.
Or so we thought. Now it seems these might be far from the limit of the problem, as many “promoters” of schemes, such as accountants, lawyers and specialist “boutique” tax avoidance firms, are refusing to play the game.
A parliamentary answer obtained by Austin Mitchell MP, who has also tabled an early-day motion urging action on tax avoidance, reveals that no fewer than 90 promoters are under investigation for failing to disclose schemes. Presumably they were either hoping they wouldn’t be picked up or think they have found a loophole in the rules.
As promoters tend not to limit themselves to the odd scheme or two, the number of undeclared wheezes could be significant, especially if some of the bigger promoters think they have successfully found ways around disclosure. And that’s without considering any that are still beavering away unnoticed.
Ninety promoters not disclosing schemes is alarming, even with the reassurance that HMRC is onto them. At the very least it shows that, valuable as disclosure rules are, they are no guarantee of authorities getting on top of tax avoidance.
Visit the BTC website for compliance help and support for firms in the regulated sector.
