And so the battle to appear whiter than white begins – and not before time. As British politicians fall over themselves to publish their tax returns, the UK government has announced the launch of a new taskforce to investigate the Panama Papers. With set-up funding of £10 million and continued money promised, investigators from HMRC, the National Crime Agency, the Serious Fraud Office and the Financial Conduct Authority will get together to find out who hid what in Panama – with seven hundred leads already identified. As the newspapers have (understandably) been concentrating on the well-known names among Mossack Fonseca’s clients, I am pleased that a more objective investigation will take place and hopefully root out non-sleb tax evaders.
But what is amusing me is the self-delusion on show. Now I’m not naïve enough to think that politicians can tell the unvarnished truth, but I do worry that the varnish can become so thick that the true nature of what is underneath will be contorted and even obscured. Announcing the new Panama Papers taskforce, for instance, PM David Cameron said “The UK has been at the forefront of international action to tackle the global scourge of aggressive tax avoidance and evasion, and international corruption more broadly.” Certainly the UK has been at the forefront of discussion and suggestion, but action? not so much. On the “Today” programme on Monday, the Chief Minister of the Isle of Man Allan Bell spoke of his jurisdiction being at the forefront of transparency – it must be quite crowded out there in the forefront. And again, the Isle of Man’s policy on sharing information on beneficial ownership is up to international standards, but at the forefront? Not quite.
The truth is that everyone claims to be at the forefront, but no-one actually wants to be there. The forefront is a dangerous place, politically and commercially. Politically dangerous because you might make a decision that later turns out to be unachievable or unrealistic, opening you up to ridicule and charges of U-turns or of not keeping your promises. And commercially dangerous because, in today’s global economy, if you make your jurisdiction that little bit tougher than everyone else’s (asking for more due diligence information, publishing more beneficial ownership details), then your clients will simply up sticks and go elsewhere. I suspect that where jurisdictions should aim to be is at the front – not the forefront – with arms linked with everyone else. Maybe a chorus line of jurisdictions, kicking out at crime. There’s your Friday image – you’re welcome.