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The rise in Switzerland, United States and the Cayman Islands ratings in Financial Secrecy Index (FSI) published by the respected Tax Justice Network for 2018 has created anxiety over the chances of accessing loots starched away by former military junta, late Gen Sani Abacha and many other politically exposed persons (PSPs) who are being trailed by Nigerian government. Before now, the federal government had been battling series of legal conditions given by US authorities in the repartriation of Abacha loot.
The Index released at the end of January, 2018 shows indicated that whereas Switzerland remained on top of the chat, the US followed with tax-heaven Cayman Islands occupying third position.
Financial secrecy, according to TJN, is a key facilitator of financial crime, and illicit financial flows including money laundering, corruption and tax evasion. Jurisdictions who fail to contain it deny citizens elsewhere their human rights and exacerbate global inequality.
The Index assesses countries against criteria which include whether companies, trusts and foundations are required to reveal their true owners, whether annual accounts are made available online in open data format, or the extent to which jurisdictions’ rules comply with anti-money laundering standards (FATF’s 40 recommendations).
This year, TJN says several new indicators have been added to the Index and existing indicators have been substantially revised to drill deeper into questions around ownership registration and disclosure.
It indicates that a total of 20 Key Financial Secrecy Indicators (KFSI) is used for the measurement of the secrecy score.
The Financial Secrecy Index value, the Network says is obtained by combining the Secrecy Score (how secretive a jurisdiction is) with the Global Scale Weight (how big a financial centre is, in terms of financial services offered to non-residents).
The federal government had in the last couple of years been trailing millions of dollars said to have been oiled away by late Gen Sani Abacha and so many other Nigerian government officials in the three nations who are now leading in financial secrecy index, globally. .
Details from the TJN show that the three countries are the world’s biggest contributors to financial secrecy.
The report said S has risen rapidly on the Index and that is considered worrying. The Network says the US’ rise in the current rankings is part of a worrying trend, indicating that this is the second time in succession that the USA has risen up the Index.
It would be recalled that in 2013 the US was in 6th place, and in 2015 it took 3rd. In 2015 the country was one of the few to increase its secrecy score.
TJN revealed that current rating in ranking is driven by a huge rise in America’s share of the market in offshore financial services that wasn’t neutralised by a significant reduction in their secrecy.
In total, the share of global offshore financial services taken by the United States rose by 14 per cent between the 2015 and 2018 index from 19.6 per cent to 22.3 per cent, it says.
The 2018 report said Switzerland, the global capital of bank secrecy, retains the worst ranking, and the US has moved up to second. With Bahrain and Lebanon dropping out of the top ten, Guernsey and a new entry in Taiwan has replaced them.
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