The Financial Secrecy Index Shedding light on global financial secrecy The FACT Coalition – Washington D.C., November 2 nd, 2015 Andrés Knobel –

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Presentation transcript:

The Financial Secrecy Index Shedding light on global financial secrecy The FACT Coalition – Washington D.C., November 2 nd, 2015 Andrés Knobel –

WHY THE FSI? CLARIFY THE REAL ISSUES IDENTIFY THOSE ACTUALLY RESPONSIBLE MONITOR & PUSH FOR EFFECTIVE MEASURES TAX HAVEN LISTS FSI TAX HAVEN SECRECY JURISDICTION TAX RATE / (Weak) OECD Standards SECRECY INCONSISTENCY & USUAL EXCLUSIONS 60-> 73-> 82 -> 102-> … ALL JURISDICTIONS only SMALL PALMED ISLANDS OECD COUNTRIES TOO! POLITICAL PRESSURE OBJECTIVE & VERIFIABLE BLACKLIST / WHITELIST SPECTRUM YES/NODEGREE

WHY THE FSI? CLARIFY THE REAL ISSUES IDENTIFY THOSE ACTUALLY RESPONSIBLE MONITOR & PUSH FOR EFFECTIVE MEASURES TAX HAVEN LISTS FSI TAX HAVEN SECRECY JURISDICTION TAX RATE / (Weak) OECD Standards SECRECY INCONSISTENCY & USUAL EXCLUSIONS 60-> 73-> 82 -> 102-> … ALL JURISDICTIONS only SMALL PALMED ISLANDS OECD COUNTRIES TOO! POLITICAL PRESSURE OBJECTIVE & VERIFIABLE BLACKLIST / WHITELIST SPECTRUM YES/NODEGREE

Global Transparency (as of Oct 2015) according to OECD’s Global Forum: The Job is practically done! LEGAL FRAMEWORKLEGAL FRAMEWORK & IN PRACTICE Partially Compliant: 12 out of 86 jurisdictions (Andorra, Anguilla, Antigua & Barbuda, Barbados, Costa Rica, Curacao, Indonesia, Israel, St. Lucia, Samoa, St. Maarten, Turkey) No: 8 out of 34 jurisdictions (Micronesia, Guatemala, Kazakhstan, Lebanon, Liberia, Nauru, Trinidad & Tobago, Vanuatu)

Moderately secretive Exceptionally secretive How Secretive? How much Market share? tiny large huge small FSI STRUCTURE SECRECY SCORE GLOBAL SCALE WEIGHT WEIGHTED BY HOW MUCH OPACITY EACH JURISDICTION OFFERS TO NON-RESIDENTS (TO ALLOW THEM TO ESCAPE/UNDERMINE LAWS, RULES, TAXES, ETC. ABROAD), WEIGHTED BY THE JURISDICTION’S MARKET SHARE OF FINANCIAL SERVICES FOR NON-RESIDENTS (based on IMF’s Zoromé 2007)

SECRECY SCORE Lowest available transparency denominator!!

WHOSE SECRECY PROVISIONS POSE BIGGER RISK?

FSI 2015 RESULTS: TOP 10 RankingFSI 1 Switzerland 2 Hong Kong 3 USA 4 Singapore 5 Cayman Islands 6 Luxembourg 7 Lebanon 8 Germany 9 Bahrein 10 Dubai / UAE Average of SS 68.0 Sum of GSW 56.5% Secrecy Score Global Scale Weight VanuatuUnited States SamoaUnited Kingdom LiberiaLuxembourg St. LuciaGermany Brunei DarussalamSwitzerland Antigua & BarbudaCayman Islands LebanonSingapore Marshall IslandsHong Kong S.A.R. BahamasFrance BelizeIreland %78.7% FSITAX HAVEN LISTS

WHAT IS THE FSI? 1) RANKING of the World’s biggest contributors of Financial Secrecy

WHAT IS THE FSI? 2) DETAILED REPORTS on more than 100 jurisdiction’s legal framework regarding banking secrecy; ownership registration of companies, trusts, foundations; compliance with AML, CbCR, and many more… From December 2015

WHAT IS THE FSI? 3) NARRATIVE REPORTS for FSI’s Top Jurisdictions and other tax havens

Allows identifying risks & tracking progress or deterioration (in relative terms) of jurisdictions’ transparency frameworks FSI 2011 FSI 2013FSI 2015

RankingFSI USA THE U.S. NO BENEFICIAL OWNERSHIP REGISTRATION vs FOR COMPANIES NO COUNTRY-BY-COUNTRY REPORTING vs (CbCR) FOR BANKING & EXTRACTIVES NO MULTILATERAL AUTOMATIC INFORMATION EXCHANGE (OECD’s CRS)vs 91 Jurisdictions! A BIG LAGGARD RELATIVE TO MOST FINANCIAL CENTRES! SS = 60 GSW = 19.6%

WHO USES THE FSI’s RANKING & DETAILED COUNTRY-REPORTS? (at least those we are aware of) - NGOs & Activists - Journalists - Researchers - Tax Authorities (for ownership registries, evasion schemes and investigations) - Law-Enforcement Agencies (to support prosecutions & financial-crimes investigations) - Banking Supervisors & FIUs (AML risks regarding jurisdiction’s types of legal entities)

THANK YOU! More Information:    