Global powers should act to shut down offshore tax havens, economist Joseph Stiglitz says
By Zach Dubinsky — November 15, 2016
Offshore havens are “co-conspirators” in crimes like tax evasion, corruption and even child pornography, and should have a firewall built around them by the biggest global economies in an effort to choke them out, a famous economist says in a report published today that was prompted by the Panama Papers.
Recommending “severe” penalties for violations, former World Bank chief economist Joseph Stiglitz says it should be illegal to open a bank account in a secretive tax haven, to set up an offshore corporation in one, or for banks to send or receive money there.
“Regulators should treat secrecy havens like the carriers of a dangerous disease.… They should be cut off from the global financial and economic system,” Stiglitz writes with co-author Mark Pieth, a professor of criminal law at the University of Basel in Switzerland and an expert on global money laundering and financial crime.
The goal should be to force reforms in, or at least seal off, any countries or jurisdictions that refuse to open up their financial systems and provide a basic level of transparency about corporations, accounts, money movements and tax treatment, the authors say.
“It’s a good idea,” said Vancouver-based financial crime expert Kim Marsh, a former RCMP fraud investigator who is now president of IPSA International, a global firm that does corporate investigations and due diligence.
“It would be difficult to compel people to comply on, but there would be ways of enforcing it if the World Bank and IMF and others got behind it, and they would have to be aggressive.”