• Tue
  • Dec 23, 2014
  • Updated: 9:11pm
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FRANCE

British Virgin Islands slam company leaks as 'illicit'

Government of British Virgin Territories calls journalists' investigation 'illicit' as European countries adopt action plan against tax evasion

PUBLISHED : Wednesday, 10 April, 2013, 9:18pm
UPDATED : Thursday, 11 April, 2013, 10:28am

The government of the British Virgin Islands (BVI) called an investigation by the International Consortium of Investigative Journalists (ICIJ) into the British overseas territory "illicit" and is investigating how the group obtained information on BVI companies.

Meanwhile, French President Francois Hollande and the European Commission have announced tougher measures against tax evasion.

"The BVI authorities are actively investigating how this private information has been illicitly obtained and used to attack the BVI financial services industry, which operates compliantly within international guidelines and the law," BVI Premier and Finance Minister Orlando Smith said in a statement e-mailed to the South China Morning Post.

The BVI authorities are actively investigating how this private information has been illicitly obtained 
BVI Premier and Finance Minister Orlando Smith

In one of the biggest information leaks in history, more than two million documents naming many individuals and detailing their financial dealings through offshore accounts were made available to the US-based ICIJ.

The group has been making public bits of the information it has obtained, which has sparked worldwide reaction from governments and politicians.

Smith said the leak was an isolated incident. "There is no indication of contagion or that the breach was systemic. Also, no breach of BVI official databases has occurred," he said.

On Tuesday, the European Commission announced an action plan to combat tax fraud and evasion. Britain, France, Germany, Italy and Spain agreed to co-operate on a pilot information exchange system to catch tax dodgers. Hollande has called for the eradication of tax havens and ordered French banks to declare all their subsidiaries, the BBC reported. He said his government would set up a central agency to fight fraud and corruption.

In the wake of the ICIJ's revelations, Hollande's friend and campaign treasurer Jean-Jacques Augier was forced to publicly admit he had a partnership with a Chinese businessman, Xi Shu, in an offshore firm.

Former French budget minister Jerome Cahuzac has been charged with tax fraud over a secret Swiss bank account. The French government has set a deadline of April 15 for ministers to declare their assets.

In 2009, then French president Nicolas Sarkozy and German Chancellor Dr Angela Merkel pushed for the naming and shaming of tax havens if they failed to end bank secrecy.

In response, China said it supported global efforts to tackle tax havens but did not want Hong Kong and Macau to be included among them.

Smith said in his statement: "While the overwhelming majority of persons use international financial centres for legitimate purposes, there are those that will abuse the system. Where wrongdoing is discovered, appropriate enforcement action is and will be taken. We continually review our legislative regime to ensure transparency, co-operation and compliance with international standards."

The BVI recently announced its commitment to concluding Foreign Account Tax Compliance Act negotiations with the US Treasury and entering a similar arrangement with Britain.

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caractacus
Mr. Orlando Smith says the investigation by journalists is illicit, but how much of the money parked offshore in companies registered in the BVI and other tax havens is the proceeds of tax evasion, fraud, corruption, and other crimes? Why the secrecy if the real owners have nothing to hide?
Who provides and operates the companies and their bank accounts in return for lucrative fees?
What possible legitimate reason can there be for politicians, particularly Asians, in owning such companies?
The lid is only beginning to be peeled off the sink of corruption hidden behind many of these companies. Time for transparency.
captam
@"The BVI authorities are.. investigating.. how private information has been illicitly obtained and used to attack the BVI financial services industry, which operates compliantly within international guidelines and the law,"
Tax evasion is a criminal act. Are the BVU authorities suggesting it is "wrong" for the media and other regulators to investigate those who cheat? Obtaining "secret" information on criminal behaviour is perfectly legitimate in any well-governed society.
The French President is right to aim for these tax havens, many with more banks than residents, to be put out of business.
And the Hong Kong Stock Exchange should be planning to delist public companies who incorporate offshore.
johnfra
where is it??
johnfra
How dare this crooked island call spreading of information so that the public can be properly informed as "illicit". Must let them know that Hong Kong don't want them here.
There are 20 something thousand residents there and 480 something thousand companies registered there. What other presumption do you need!
mcheung
"China said it supported global efforts to tackle tax havens but did not want Hong Kong and Macau to be included among them.".... What a Joke ! It says it all !
Giwaffe
The BVI government is acting entirely within reason in its defense of its reputation as a financial service center. Any jurisdiction that depends on external financial flows as its primary economy activity would have a strong vested interest in ensuring that its sensitive data be kept private and confidential.
Conversely, publicly elected officials should most certainly declare assets as a condition of assuming office. Private citizens, on the other hand, should be free of such encumbrance consistent with the presumption of innocence.
 
 
 
 
 

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