The release of the “Panama Papers” has confirmed the UK’s role as a haven for corrupt individuals and their stolen wealth, according to an anti-corruption pressure group. Transparency International UK has set out recommendations to end the UK’s role in enabling global corruption and calls on the Prime Minister to use the Anti-Corruption Summit on May 12 in London to act.
Rachel Davies, Head of UK Advocacy and Research Transparency International UK said: “The Panama Papers have confirmed that the UK is a prime location for corrupt individuals looking to hide their illicit wealth and buy their way into respectability. Last year, the Prime Minister made a personal commitment to end the UK’s role as a safe haven for corrupt funds. Now is the real test of how serious that rhetoric is. The Anti-Corruption Summit on 12th May is the ideal opportunity for the UK to turn words into action. It must get its own house in order.
“If corrupt individuals are allowed to continue to buy up luxury property and enjoy life in the UK, then the Government risks its credibility in leading efforts to tackle corruption on the global stage. Our recommendations lay the basis of what the UK must do immediately to ensure its hands are clean in the fight against global corruption.”
For background, see the TI report on how the UK is a haven, enabling corrupt individuals to enjoy luxury lifestyles and cleanse their reputations: http://www.transparency.org.uk/publications/paradise-lost/.
TI’s recommendations include:
– Ensure the UK’s Overseas Territories and Crown Dependencies introduce centralised public registers of beneficial ownership, and ensure corrupt individuals cannot buy UK property with impunity.
– Act on unexplained wealth by increasing the capabilities of the UK’s asset recovery regime to seize corrupt funds.
– Fix the flaws in the UK’s anti-money laundering regime – overhauling the supervision of the rules, and prosecuting complicit professional enablers.
The campaign group points out that of the 214,000 corporate entities exposed, over half were registered in the British Virgin Islands. The UK was the second most popular place for the Mossack Fonseca firm to operate. According to the investigative journalists ICIJ, Mossack Fonseca worked with 1,924 UK professional enablers to set up companies, foundations and trusts for customers. For more on the issue visit https://panamapapers.icij.org/. The ICIJ worked on a leak of more than 11.5 million financial and legal records that exposes a system that enables crime, corruption and wrongdoing, hidden by secretive offshore companies, according to the ICIJ.
José Ugaz, the chair of Transparency International said: “The Panama Papers investigation unmasks the dark side of the global financial system where banks, lawyers and financial professionals enable secret companies to hide illicit corrupt money. This must stop. World leaders must come together and ban the secret companies that fuel grand corruption and allow the corrupt to benefit from ill-gotten wealth.”
Among those named in the papers was TI’s chair of its chapter in Chile, Gonzalo Delaveau Swett, who resigned.
Rajiv Gupta, CEO and founder of cloud access security broker, Skyhigh Networks, believes that, because of its ability to empower whistleblowers, technology will continue to play a starring role in political scandals of the future and this generation’s Watergate. He says: “Political scandal, first through Edward Snowden and now through the Panama Papers hack, has followed bank robbery and espionage into the digital age. Only with online tools could a whistleblower hope to make off with 2.6 terabytes accounting for 11.5 million documents, and could journalists rely on powerful collaboration software to analyse the information. This generation’s Watergate will be conducted through shared folders and chatrooms.
“On the business side, this data breach should be a wake-up call to all industries: Hackers are not just after social security, health insurance, and credit card numbers. Determined attackers follow ideological, political, and financial motives. Organisations need to assume all sensitive information — from private transactions to personal communication to intellectual property — is a target.
“Organisations will need to start factoring cybersecurity capabilities into their vendor evaluation. The theft of client data draws awareness to the exposure organisations face from their business partners, especially those with access to large amounts of confidential information. Several top law firms recently suffered data breaches, a painful lesson that cybersecurity is a fundamental component of confidentiality. To an organisation a good CISO is becoming just as valuable as a good attorney or a good doctor to an individual.”
Separately, the intelligence risk consultancy PGI Intelligence brought out its analysis of the affair: https://pgi-intelligence.com/news/getNewsItem/Fallout-from-Mossack-Fonseca-leak-set-to-last-months/632.
