Global Financial Integrity

GFI header image

Illicit Financial Practices Face ‘Perfect Storm’ of Legal and Legislative Actions, Says Global Financial Integrity

Monique Perry Danziger, +1 202 293 0740 ext. 222
Global Financial Integrity
Monique Perry Danziger, +1 202 293 0740 ext. 222

WASHINGTON, DC – With current prosecutorial and investigative actions against tax dodgers being stepped-up and legislation gaining ground in the U.S. Senate that will tackle everything from money-laundering to tax haven abuse, the potential for far-reaching changes in how Americans bank and do business is set to change, says Global Financial Integrity.

“The combination of high-profile financial scandals, federal investigations and tenacious prosecution of financial misconduct, and shifting power dynamics within the halls of congress are going to change the finance management landscape sooner rather than later,” said GFI director Raymond Baker.

The most recent investigation into Swiss bank UBS AG, which made headlines last week when two former employees were charged with abetting tax evasion by Americans, comes amidst numerous forays by government officials and legislators, here and abroad, into the shadowy world of offshore financial centers and their clientele.

Several pieces of legislation aimed at stopping abuse of tax havens, curtailing money-laundering, raising transparency, and closing loopholes in existing laws are enjoying robust attention due to these recent events.

Bills to watch include:

  • S. 681 the Stop Tax Haven Abuse Act
  • S. 473 Combating Money Laundering and Terrorist Financing Act of 2007
  • S 396 a bill to treat controlled foreign corporations established in tax havens as domestic corporations
  • S. 2956 a bill to clarify the links and fiscal responsibilities between offshore holdings, companies and their owners for taxation purposes.  It is notable that Presidential hopeful Senator Barrack Obama is a cosponsor on S. 681 and S. 2956.

“The events of recent months foreshadow a coming sea change in how the world deals with illicit financial practices like tax evasion, money-laundering, and the many different ways money moves surreptitiously and illicitly across borders,” said Baker. “These changes have the potential to recover huge sums of national revenue while hindering illicit commerce around the world.”