Learn About Illicit Financial Flows
Key Terms



Settling accounts: what happens after SwissLeaks?

Koen Roovers

A major leak of incriminating HSBC records last week resulted in print and television news coverage around the globe, trended on Twitter for several days and prompted several governments to start long-anticipated investigations. Through its Swiss entity, the British banking juggernaut helped customers from around the world to hide their money for tax evasion or other nefarious purposes without any questions asked. In fact, in several of the ‘scripts’ which accompany the accounts, banking personnel are seen to be very willing to accommodate dubious requests—from allowing cash withdrawals worth millions of dollars to setting up sham legal entities to obscure the ownership of the funds.

The ‘Lagarde list’, as the files have come to be known, has been around for a couple of years and so many have been asking: ‘Why do we only see government action once a group of reporters put the spotlight on this?’ Another frequent question has been whether the bank has really (as it claims) cleaned up its act.

Relatively few commentators have asked: how do we prevent this in the first place?


HSBC findings don’t surprise us. What will it take for things to change?

Robert Palmer

7241603398_414983169d_z (1)

Fresh revelations from the Guardian today, paint an even bleaker picture of HSBC Geneva’s client list. According to the paper, the bank’s customers included those who faced allegations of drug-running, corruption, doping and money laundering.

Over twenty years, Global Witness has campaigned to stop a lot of things, from blood diamonds to corrupt dictators, to the money flows that fuel conflict. It appears that HSBC has been playing its part in enabling the money flows that support such activities. In some cases, the Guardian claims to have evidence that HSBC bankers were aware of some of the allegations against their clients.

Press Releases

Leaked HSBC Records Shed Light on Culture of Corruption in the International Banking System

Global Financial Integrity

WASHINGTON, DC – Leaked HSBC documents revealed today by the International Consortium of Investigative Journalists (ICIJ) highlight a culture of corruption in the international banking system that goes far beyond the world’s second biggest bank, noted Global Financial Integrity (GFI), a Washington, DC-based research and advocacy organization. Featured Sunday evening on CBS News’ 60 Minutes program, the files allegedly highlight how the Swiss branch of the bank meticulously catered to some of the world’s biggest dictators and criminals, and they are but the latest example of a global bank gone rogue.


How long does it take for an era to end?

Joseph Stead

As the G20 finance ministers assemble in Istanbul this weekend, there’s a good chance at least one of them will repeat the phrase ‘the era of bank secrecy is over’, heard several times since the 2009 G20 Summit. But before anyone thinks of repeating it again, they should instead look at the plans (or lack thereof) for including developing countries. As our new report, Information for the Nations, explains, while new reforms on financial transparency are welcome, the proposals could end up leaving a number of developing countries behind.

At the heart of all this is the fact that vast amounts of money are held offshore (by some estimates up to $21 trillion); at best, only 20% of this is thought to be declared for tax. With little ability for tax authorities to find out who has cash stashed offshore, up until now little could be done to stop these tax evaders. That’s now set to change (for rich countries at least), as 52 of the biggest economies and the biggest tax havens have agreed to automatically share details of offshore accounts to tax authorities in other countries.

Press Releases

Era of Bank Secrecy Still Far From Over For Developing Countries

Christian Aid

G20 Finance Ministers meeting in Istanbul this weekend still have much to do if the claim ‘the era of bank secrecy is over’ is to mean anything in developing counties.

In a new report from Christian Aid, endorsed by 18 other civil society organisations, the flaws in the current approach of the G20 towards automatic exchange of tax information are laid bare.

Joseph Stead, Christian Aid’s senior economic justice advisers said today: “There remain loopholes in the standards that will limit the impact in all countries, but for developing countries there are some specific challenges that remain, despite the promises of the G20 to take action.

“It’s estimated that 33 per cent of African and Middle East-owned assets are held offshore compared to 6 per cent of European-owned assets. This suggests tax evasion on a significant scale.


Five take-aways for Europe from the African Union’s High-Level report on illicit financial flows

Christian Hallum

6171626086_24fafd82fa_zLast Saturday a landmark decision was taken when the African Union, made up of 54 African Heads of State, adopted the report of the High Level Panel on Illicit Financial Flows (IFF). This report documents the scale and impact of IFF from the continent and gives a range of policy recommendations. Our friends at the Tax Justice Network says the report is“probably the most important report yet produced on this issue” and for good reasons.

The new report is not only a strong testament to the importance that African leaders are placing on the issue of IFF, but its publication ahead of July’s Financing for Development (FfD) conference is an indication that the issue is likely to figure prominently among items raised by developing countries during the negotiations.

Press Releases

From the Atlantic to the Pacific, Civil Society Organizations across Africa Welcome AU Focus on Illicit Financial Flows

Tax Justice Network Africa

ADDIS ABABA— As African leaders are meeting in  Addis Ababa to discuss growing threats from extremist groups, instability, and poverty, Heads of State are urged to give priority to  a growing threat to their economies: illicit financial flows.

On Saturday, African Union Heads of State will review a report produced by the AU High Level Panel on Illicit Financial Flows, which has been chaired by Thabo Mbeki. The new report looks at the dire consequences of illicit financial outflows from Africa, estimated at US$50 billion per year, according to Global Financial Integrity (GFI) and the African Development Bank.

“The fact that our leaders are devoting a portion of their very full session to illicit financial flows underlines just how serious this issue is,” said Savior Mwambwa, Policy and Advocacy Manager for the Tax Justice Network Africa. “Illicit financial flows are not only an extreme hindrance to Africa’s development, they are growing rapidly every year.”


Tax Justice Network’s Illicit Finance Journalism Programme Now Accepting Applications

Tax Justice Network


We are delighted to issue a call to journalists and campaigners to attend the fifth Illicit Finance Journalism Programme. TJN’s financial investigative journalism training course takes place in London between Tuesday 12 May – Friday 15 May 2015 at City University London, Northampton Square, EC1V 0HB.

This course is aimed at practicing journalists who have an interest in investigating business and the flow of money. Experience in financial reporting is an advantage but not a prerequisite. Class instructions will take place in English. There are bursaries for journalists from the developing world to cover visa fees, travel, accommodation and per diems for food and travel in London. Due to the limited number of bursaries, applicants will be selected based on their track record in investigative journalism, but you do not need to have a financial background to apply.


Loophole USA: the vortex-shaped hole in global financial transparency

Nicholas Shaxson

If people stash their wealth or earn income overseas, that is fine with us — just as long as their tax authorities get the information they need to tax that wealth or income according to the law, and as long as money laundering and financial crimes can be effectively tracked, and so on. Where there are cross-border barriers to the instruments of democratic societies, then there is an offshore problem.

The only credible way to provide the necessary information is through so-called automatic information exchange (AIE), where governments make sure the necessary information is available across borders, as a matter of routine.

For years we at the Tax Justice Network were ridiculed for advocating AIE: pie in the sky, many people said. The OECD, the club of rich countries that dominates international rule-making on tax and tax-related information sharing, was for years pushing its so-called Internationally Accepted Standard which was, well, the internationally accepted standard for cross-border information exchange, despite being only slightly better than useless. The message was that we should just accept this, and move on.


TaxCast January 2015: How Offshore Havens are Infiltrating Football and More

Christian Freymeyer

In the January 2015 Taxcast: how offshore is ruining the ‘Beautiful Game’: the Taxcast scrutinises football’s own goal. Also: how banks with criminal convictions are being allowed to continue to handle our money, how people may be allowed to apply for anonymity in the UK’s new register of beneficial owners of companies to be introduced in 2016, and the meeting of the world’s most powerful in that bastion of transparency, Davos, Switzerland. Plus more scandal and unique analysis.


Closing Tax Loopholes is Great, But Tackling Anonymous Companies is Just as Important

Christian Freymeyer

President Obama wants to stop the billions of dollars that are moving offshore from U.S. companies.

Or he at least said so much during his State of the Union address last night:

As Americans, we don’t mind paying our fair share of taxes, as long as everybody else does, too. But for far too long, lobbyists have rigged the tax code with loopholes that let some corporations pay nothing while others pay full freight.

This year, we have an opportunity to change that. Let’s close loopholes so we stop rewarding companies that keep profits abroad, and reward those that invest in America.

The topic of moving money to low tax jurisdictions has become a hotly debated issue over the last few months, following the LuxLeaks scandal that brought light to hundreds of secret tax arrangements between multinational corporations and Luxembourg.


How Country by Country Reporting Could Have Made LuxLeaks Unnecessary

Carl Dolan

The lux leaks saga moved up a couple of gears last week. First of all, a large number of MEPs broke ranks with their leadership to publicly back a European Parliament committee of enquiry into the so-called ‘sweetheart deals’ that Luxembourg concluded with hundreds of multinational companies to minimise their tax bill. The Parliament’s political decision-making body, the Conference of Presidents, has yet to formally approve the enquiry but the genie seems to be well and truly out of the bottle now, even if there are reports that EPP deputies are being put under pressure to withdraw their signatures.  The enquiry will range more widely than the Luxembourg deals  – many other EU countries have similar tax rulings  in place – but there is the tantalising prospect of Jean-Claude Juncker testifying in front of MEPs on what he knew when he was Prime Minister.

Secondly, and perhaps more significantly, the Commission announced its preliminary findings into the state aid case it launched into Luxembourg’s tax deal with Amazon, indicating that the Grand Duchy had indeed breached EU state aid rules by giving favourable treatment to the tech company over its transfer-pricing policy.

The case focuses on the Luxembourg company that served as the headquarters of Amazon’s European operations, LuxOpCo, and in particular the royalties it paid to another Luxembourg company, Lux SCS, that were not subject to Luxembourg tax.

The net turnover of LuxOpCo in 2013 was 13.6 billion euros – about a fifth of Amazon’s total worldwide sales.

Pg 1 of 271 1234...1020...Last