Businesses that set up offshore companies know what they are doing – TJN

Tax-Justice-The Tax Justice Network (TJN) says firms that set up secret offshore companies know what they are doing.

In a press release issued today April 4, 2016 following the leakage and publications of what has become known as Panama Papers, TJN says “law firms like Mossack Fonseca know exactly what they are doing when they set up secret offshore companies. Lawyers operate in a privileged environment. Although they have a duty of confidentiality to their clients, that duty does not override their obligation to uphold the law.”

TJN argues that, this means performing adequate due diligence on their clients and informing the relevant authorities when they come across suspicious activity.

TJN notes that, far too many offshore lawyers, accountants and bankers see it as their role to shield their clients from financial regulations designed to prevent money laundering, tax evasion and corruption.

It further indicates that for many years it has highlighted the role Panama has played in the global offshore industry.

“Our Financial Secrecy Index, the benchmark for assessing the secrecy of financial centres, assigns Panama with one of the highest secrecy scores in the world,” it said.

The kind of financial secrecy practised by Panama is designed specifically to avoid global regulations requiring the disclosure of assets. In many cases this secrecy is established for the sole purpose of hiding criminal or corrupt transactions, the organization said.

According to TJN, for years it has called on governments around the world to implement the policies required to stamp out tax evasion, corruption and criminality, but has seen little progress.

“We note that today’s latest leak from the ICIJ highlights yet again how financial secrecy permeates the global political and business elite; many of whom are responsible for designing the rules on the global economy,” it adds, calling for the practice to end.

By Emmanuel K. Dogbevi

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