In recent weeks I have worked in Guernsey and Jersey and I am rather fond of both places – not least because they have rather strict AML regimes, and you know how I feel about taking AML jolly seriously. Despite their best efforts, both G and J are frequently the target of finger-pointing by larger jurisdictions, who call them “offshore” as an insult rather than as a geographical observation, and who make no secret of the fact that they consider the islands to be afloat on a sea of dodgy money. This is, of course, entirely erroneous, and those of us living in the UK, with the billions being laundered here each year, Shud No Better.
That said, none of us is perfect, and both islands – along with their northern cousin, the Isle of Man – could put yet more effort into improving their international reputation. I speak of the Corruption Perceptions Index. I like this index, as regular readers will know: it is well-researched, clearly presented, promptly delivered – and does what it says on the tin. It does not pretend to measure corruption, which is all but impossible to do: instead, it records perceptions of corruption and ranks accordingly. In the latest iteration – published in January 2019 – there are 180 countries in the CPI. This means that, depending on how you count disputed territories, there are at least seventeen countries missing – and among them are Jersey, Guernsey and the Isle of Man.
This is a shame for all three as – I imagine – were they to be included in the CPI, they would score well. Whatever others might say about them, no-one has suggested that they are riddled with corruption (or at least, not in my hearing – and I’m always listening…). Scoring well on the CPI is a fillip to international trade, not least because it reassures those who do risk assessments in the financial and related sectors that money flowing through you is more reliable, and that your PEPs can be trusted not to pilfer from the public purse. So what to do? Well, the CPI is in fact a composite index of thirteen source “surveys and expert assessments” by such august institutions as the World Bank and the Economist Intelligence Unit – this is to give a broad view of the world and to retain objectivity. And to be included in the CPI your jurisdiction has to appear in at least three of the thirteen sources. J, G and IoM appear in only two – bah! If I were running the show in any of the three, I’d look at getting my island appraised quick smart by a third survey or expert assessment – and then I’d appear on the CPI (in a good, high position) and (even better) be able to blow a raspberry at the other two islands.
I hate money laundering 
Susan, Very interesting article and good points made. Not quite sure who should be pushed to consider taking this forward. No doubt given a few minutes names should start to come to mind!! No doubt be seeing more of you out here as the weather warms and seafood + mandatory bottle of wine eaten outside becomes the order of the day!
Whichever of you takes the initiative and gets listed first, I shall expect full credit for the idea! And yes, lunch al fresco on a sunny island is always an attraction.
As Crown Dependencies, I don’t think the Isle of Man or Jersey and Guernsey count as countries. Transparency International are not great fans of the islands as they regard them (unfairly and unjustly) as depositories for ill gotten gains of third world dictators and their rapacious profligate family members (which goes to your finger-pointing point)
Thank you for your comment, James, and welcome to the blog. I am far from being a constitutional expert, but I must admit that I had thought that Guernsey, Jersey and the Isle of Man were countries – albeit with special (and often confusing) links to the UK. After all, they each have their own team in the Commonwealth Games!
There is an HMG document that seeks to explain it (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/734590/crown-dependencies-factsheet.pdf) and this bit is interesting: “The Crown Dependencies are not recognised internationally as sovereign States in their own right but as ‘territories for which the United Kingdom is responsible’… However, the Crown Dependencies are developing their international identities and in 2007-2008, the then-Secretary of State for Constitutional Affairs signed an agreement with the Chief Ministers of each of the Crown Dependencies stating that the UK would not act internationally on their behalf without prior consultation and recognising that in international matters, particularly in relation to the EU, UK and Crown Dependency interests may differ. The agreements also set out a framework for the further development of the international identities of the Crown Dependencies.”
The use of the word “territory” caught my eye, as I remember that the Corruption Perceptions Index seeks to include not just countries, but also territories, as explained in their FAQ: “For a country/territory to be included in the ranking, it must be included in a minimum of three of the CPI’s data sources. If a country is not featured in the ranking, then this is solely because of insufficient survey information and not an indication that corruption does not exist in the country. This year 180 countries and territories are included in the index, the same as 2017.” So even if we cannot be sure that G, J and the IoM are countries, they are certainly territories – and could be considered for inclusion in the CPI…
I guess this would make me the champion of Orthodoxy, as I am afraid I am one of those people who do raise their eyebrows at the Crown Dependencies.
I do have in laws in jersey, they have a very mixed opinion of the Island and how it works, so I am not sure the Bailliwick would be as high up the CPI as you hope.
I must confess though to a bias brought on by experience, I have worked on too many cases were a financial trail has come back to the Channel Islands, and while their law Enforcement and regulators have always been very helpful, I find myself asking why so any ne’r-do-wells make use of the Crown Dependencies? I find myself drawn to the conclusion that their essential set up favours the launderer. And yes the City of London is a vile engine for dark money, but again my experience is that lots of that city money is also connected through Jersey et al. Cleaning one jurisdiction might clean up both…
As I say it is a bias, but then a lot of people who seem to favour the Islands all enjoyed lovely holidays there so perhaps it is a bias that goes both ways
Interesting observations, Robert. I think you’re right, in that both the UK itself and its Crown Dependencies could improve – there’s always room for improvement. And we need to be careful not to conflate money laundering (and there is undoubtedly this activity in the UK and in the CDs) with corruption, which is what the CPI measures. It may be that the set-up in the CDs does – for various reasons (some real, some imagined) – attract money launderers, but I still imagine (as an outsider, of course) that there is very little corruption in those jurisdictions. Unless a donkey or a crapaud would care to comment…?