Nick Shaxson ■ Trove of secret Swiss bank data released to European countries: now use it!
Back in 2014 Reuters reported, in a pre-echo of the Panama scandal:
“Authorities in the German state of North Rhine-Westphalia [NRW] have bought a CD containing data about several thousand German clients of a Swiss bank, German newspaper Bild am Sonntag said on Sunday without citing its sources.”
And this wasn’t the only one: already in 2013, half a dozen of these CDs had already been purchased.
Now, from NRW’s Finance Ministry, via Sven Giegold and Tove Maria Ryding:
“The revenue service of the German state of North Rhine-Westphalia last week forwarded electronic records to more than twenty countries in Europe for scrutiny and to help prosecute tax evaders. Modelled on earlier cooperation with Greece, information on holders of Swiss bank accounts was sent to the Federal Central Tax Office (BZSt) and passed on to the various authorities.”
And here is the amount of money at stake: over 90 billion Euros’ worth, just from these data purchases.
Now, this is important, and several things need to be said.
First, the citizens and civic groups in all these countries need to start pushing their governments to prosecute what are doubtless large numbers of criminals who have been using Swiss banks. And the NRW authorities add, dramatically:
“North Rhine-Westphalia does more than supplying data to other countries. The expertise of NRW tax investigators is much in demand. Representatives from numerous authorities have learnt from their NRW counterparts about the acquisition and analysis of ‘tax CDs’ and about missing trader schemes, the so-called VAT carousel fraud. ‘We are glad to share our knowledge with other countries eager to clamp down on tax evasion’, the Minister said, ‘and we are in a very good place to do this, thanks to the productive work of our tax investigators’. The ”Panama Papers” are another reminder that tax evasion is not exclusively fuelled by the greed of individuals but supported by dedicated structures. Joining forces to fight them is the way forward.”
Which is an excellent offer, and must be taken up.
Second, we hope that the NRW Finance Ministry can share the information obtained beyond Europe: including with developing countries.
Third, there is an opportunity here in Germany which could have European ramifications. On April 20th (or, if delayed, on May 11th-13th) the NRW parliament will vote on a resolution, offered by the SPD/Green coalition that is in power in NRW, proposing making registries of beneficial ownership transparent and public. Putting this beneficial ownership data on public record is TJN’s position in this all-important area that has been so powerfully brought to people’s attention by the Panama scandal.
And there is an interesting political fight developing here which could eventually swing the position of Germany – the most powerful player in the European Union. NRW’s finance minister, Norbert Walter-Borjans, is very influential in the SPD across Germany – and if he were to back the resolution to make registries public, it would be very hard for others in the SPD to oppose it – and this would likely put immense pressure on the German government to adopt this position. There is a far weaker rival proposition alive in the SPD, however, which hews to the German governing CDU party line, which is that this beneficial ownership information should stay secret to the public: it is essential that this proposition is swept aside.
So it is crucial that this particular imminent vote on public registries goes the right way: this has significance far beyond this German state. It would be extremely useful if people from outside of Germany were to contact the relevant actors (on Twitter: @GrueneFrakNRW and @spd_fraktion_nw and see the suggested tweet, below) to express support for the resolution and the general principle of public registries. And please sign this petition organised by the German NGO Campact: although it’s in German, it is easy to see what to do. Furthermore, a suggested tweet at the bottom of this blog.
Fourth, we are also calling for the “reverse transparency”. The NRW data outlined above is from Switzerland, but now we want that data from Germany: in other words, Germany must now also publish (as Australia has already agreed to do) detailed country-level statistics about nonresidents’ assets held in Germany. We are talking about the data that is due to be shared under the OECD’s Common Reporting Standard, the global transparency scheme where data collection has already begun and will see first information shared across borders in 2017.
And of course we would like other countries to start doing this too. Our proposal for how this should happen is here.
In other news, see also UK and European allies plan to deal ‘hammer blow’ to tax evasion – and, so far, Richard Murphy’s response. (We will respond in due course.)
The US beneficial ownership law has its weaknesses, but it’s a seismic shift
Argentina keeps pushing to be at the vanguard of transparency. Now they need to make more information public
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Submission to the Committee on the Elimination of Discrimination against Women 76th Session pertaining to the 8th periodic report submitted by Panama
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