MEPs: Bankers, lawyers and accountants are “enablers” of tax avoidance
A WIDE SUPPORT NETWORK of professional organisations “played a crucial role” in the biggest financial tax evasion scandal in world history, according to MEPs interrogating the circumstances and causes behind the Panama Papers tax scandal.
Institutions of bankers, lawyers and accountants acted as “enablers and promoters of tax avoidance” allowing corporate and financial interests to slash trillions in offshore wealth beyond the fair taxation of national and local governments.
The Panama Papers scandal, which broke in April 2016, was the biggest data leak in the history of journalism and exposed the world's rich and powerful as complicit in a vast offshore secrecy cabal.
Over 11bn files from Panama legal-financial firm Mossack Fonseca exposed global banks, corporations, and political leaders as complicit in a system which hoards at least £13trn of global wealth.
The European Parliament’s Committee of Inquiry into Money Laundering, Tax Avoidance and Tax Evasion have sought to scrutinise the issue, and investigate the role of professional organisations in Luxembourg and Swiss tax haven centres.
French MEP Patrick Le Hyaric said: “If it hadn’t been for the Panama Papers leaks and the work done by the press and the judicial system, would banks have made any changes? Probably not. This underlines the weaknesses in the internal scrutiny systems of the banks: they started acting very late and absolutely refused to take any responsibility for the wrongdoings they have organised or facilitated before.”
He criticised Société Générale and BNP Paribas: “How can an employee from Société Générale in Luxembourg generate 39 times more in profits than the average for Société Générale's employees?
“Swiss law firms have been proven to have played a central part in the current Swiss tax evasion schemes.” Miguel Urbán
"In response, Société Générale and BNP continued with their line of defence by stating that they have changed their behaviour since 2009-2010. But that's too late - they are taking no responsibility for what has been done before and the legislative cat-and-mouse game to tackle tax evasion continues.”
Spanish MEP Miguel Urbán added: “Swiss law firms have been proven to have played a central part in the current Swiss tax evasion schemes. Due to their lack of supervision, and the fact that they do not comply with FATF (the Financial Action Task Force [on Money Laundering]) rules on due diligence, they are the perfect facilitator for big fortunes trying to hide from tax authorities.
“It has been chilling just listening to the President of the so-called self-regulatory body of Swiss bar and notary associations who said everything is perfectly fine - even though all indications point to the fact that they are the facilitators of millions of euros worth of tax fraud against European citizens.”
Over half of the 215,000 firms identified in the leaks were based in UK administered tax havens - with a high number linked to HSBC bank.
The ‘big four’ accountancy firms in the UK - PWC, KPMG, Ernst and Young, and Deloitte - have been criticised for facilitating a culture of tax avoidance.
Picture courtesy of Enough Food It
Check out what people are saying about how important CommonSpace is. Pledge your support today.