‘True or not, tax dodging allegations harm the islands’
Tuesday 22nd September 2009, 1:00PM BST.
Panorama’s investigator claimed a member of staff at Northern Rock (Guernsey), owned by the British taxpayer and listed on this brass plate, told him how to avoid paying tax. (Picture by Steve Sarre, 0844592)
BANKING scandals in the national media are damaging the island, according to GuernseyFinance.
A BBC Panorama programme last night introduced Guernsey and Jersey as Britain’s tax havens.
It revealed that British tax officials were investigating Lloyds Banking Group in the Channel Islands over allegations that rich clients were being encouraged to avoid UK taxes by channelling money through Hong Kong.
The programme showed an employee at the Jersey Lloyds branch telling an undercover journalist it was of no interest to the bank whether the client told the taxman about income.
While the programme focused more on Jersey, the investigator also stated that a banker from Northern Rock in Guernsey told him EU tax laws could be avoided by opening an account in the name of a non-trading company.
The member of staff said the client should inform HM Revenue and Customs, but the bank itself keeps the details from the taxman.
The reporter said that it was strange that a bank owned by the British taxpayer was encouraging him to avoid tax.
The programme also highlighted that Northern Rock (Guernsey) had been doing well since nationalisation, with deposits doubling over the last year.
GuernseyFinance chief executive Peter Niven said the bad press would tarnish the island.
‘It is extremely frustrating when this happens,’ he said. ‘About 99.9% of people on the islands do good business and very professionally and this is an unwelcome distraction and not the norm.’
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Not the norm? No leg to stand on I’m afraid Mr Niven.
Have any conversation with anyone in a banker/lawyer pub and they will quite happily talk in loud voices about what they do. Just like the Lloyds chap. What are you talking about?
You sanction theft from the poor.
You should be ashamed.
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The BBC is supposed to pride itself in taking a unbiased stance and to merely report the facts. These panaorama programs are sensationalist rubbish no doubt whole heartedly approved by the UK government. I don’t remember the BBC pointing out that tax avoidance is not a crime.
What annoys me most about this is that the people of the Channel Islands partially fund these BBC investigations via payment of the TV licensing fee.
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AC
What part of it was rubbish?
The bit where Guernsey is involved in setting up complicated structures so that the client can avoid paying tax?
Or the bit that highlights the spivvishness of the whole operation?
I would have thought paying 40p a day for an investigation that costs the tax payer billions is a good deal.
Yet you don’t?
Has Guernsey become immoral because of this type of attitude? One can only assume that as the Dean himself rubbishes claims that avoiding tax impedes social development.
Fantasy land.
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Arnald –
Your statements are untrue and simply biased to support your polarised view of the Channel Islands. If you have ever been to a pub in Guernsey you will hear most people do not want to talk about work their thoughts are on drink, sport and having a good night out.
To clarify tax mitigation (also know as avoidance) is completely legal and famously everybody in the UK has the right to mitigate their own tax liability. Given the tax regime in the UK it is not surprising that people look to structure their tax affairs where possible to avoid being caught up by the UK tax net. Everyone in the UK does their best to reduce their tax liability be that claiming tax allowances, bring back duty free goods, structuring tax efficient business or many other methods.
Tax evasion on the other hand is illegal and the Channel Island actively polices this matter by using tough regulations and having active Financial Services Commissions.
The current round of bashing ‘Offshore Tax Havens’ is designed to distract from the complete mess the UK and other major world governments have made of the economy and trying to focus blame away from themselves. The fact is that the UK economy has been massively miss-managed and money is flooding out in all directions and the Government is looking for someone (anyone) to blame.
The statement ‘theft from the poor’ shows an unbelievable ignorance of the role the Channels Islands play and their interaction with the UK economy. Whilst it is undeniable that structures exist in the Channel Islands that reduce the tax burdens of individuals and companies in the UK, you are over looking the massive contribution the Channel Islands make to ‘recycling’ money back through the UK economy via investment in Stock Markets, Funds, Property etc.
Programs such as Panaroma and the article published yesterday (Monday 21st Sept) on the BBC website look to confuse tax avoidance and evasion and paint the Channel Island, Isle of Man etc as unscrupulous regimes. This is far from the truth and the Channel Island and the Isle of Man all have a far better level of regulation than the likes of the UK. The likes of Panaorma use ‘entrapment’ style techniques to get their information and provide little or no opportunity for right of reply. This in it’s own shows the level of conviction they have in their reporting. Unfortunately as they say ‘mud sticks’ and therefore it is essential that Guernsey takes every opportunity to correct the false image being portrayed.
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Mike
You are correct that tax avoidance is legal.
I wasn’t aware that Pamorama suggested it was illegal.
What Panporama set out to show was that two banks owned or very nearly owned by the UK taxpayer, were engaging in advising potential clients on how to avoid paying taxes.
The Jersey guy was advising moving funds outside of the UK so as to avoid the EU directive.
Nothing illegal about that but morally iffy.
Now you Mike like David might see nothing wrong with morally iffy financing. After all, busineeses do it all the time.
What you cannot do is to dismiss the views of those who see the actions as morally iffy.
Those who have the temerity to disagreee with you have that right. Perhaps the right no longer sxists in Guernsey?
When you speak of the unbelievable ignorance of those who, in your mind, fail to understand what the Chaneel Islands do, you simply hammer another nail in the coffin of tax havens or low tax regimes as Mr Trott calls them.
Could it be Mike, that your comments will persuade the other side that your views reflect unbelievable ignorance?
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Oh Mike!
I hope you know what you have let yourself in for…
Very good post though, although I have to disagree about regulation, I think our regulators are just as good (bad) as the FSA.
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Great post Mike!
Stephen- I read Mike’s “ignorance” comment to be based at people who just believe the Guernsey finance industry is about wealthy individuals avoiding tax, when in reality that is far from the truth.
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Well it seems like Arnalds case just keeps getting stronger all the time. Most of us are not as ignorant as you seem to think Mike and we know there is plenty going on over here that is not moral at all, it`s just so well structured that it`s hard to follow (isn`t that the way it`s meant to be though?). But people like Arnald DOES know whats going on and thats what you guys dislike about him. Does he make you feel a little guilty about it all?
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Stephen John
Quote from the BBC Website:-
“On Monday, the BBC’s Panorama revealed how Lloyds bank’s offshoot in Jersey has been less than scrupulous in its advice to potential tax dodgers.
Earlier this month the Revenue gave people a second chance to come clean and pay tax, plus interest and limited penalties, on money they may have been hiding in bank accounts abroad. “
The BBC by using the words ‘tax dodgers’, ‘penalties’ and ‘hiding’ clearly implies something rather more than being morally iffy.
They do nothing to state that everything is above board and legal. It is clear that the objective of these articles and programs are to tarnish both the reputation of the bank and the Offshore Jurisdictions. Again with very little balanced argument or right of reply.
Similarly posts such as that made by Arnald contain nothing of a factual nature, are unconstructive and are in reality a name calling exercise. The fact that I have spent the time to challenge the post does not mean – “Those who have the temerity to disagreee with you have that right. Perhaps the right no longer sxists in Guernsey?”
I am more than happy to hear and even be persuaded by reasoned discussion supported by factual argument. Unfortunately many of the post made on the subject of Guernsey, Channel Island etc are neither and therefore it is not unreasonable to challenge those posts.
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Hey Mike, you’re wrong. Show me a success story. Ireland? Cayman? US? UK? Where’s the wealth? Where’s the development? Where’s the public satisfaction?
How is forcing governments to slash public spending a sign of investment?
You really have no idea.
Brainstorming ideas in order for more people to pay less tax is not constructive, ethical or cooperative. It serves an arrogant elite who control the vast majority of global wealth.
There is nothing to be proud about exploitation.
If the facts contained within that programme are false then do please educate me. After all, you’ve got the nerve to defend an activity that undermines society. A bit like terrorism, and the constantly repeated lines which you have regurgitated are dogmatic fundamentalism.
I can only shake my head in pity if you think that a fifth of the UK 16-24 year olds that are likely never to work and the new generation of pensioners in poverty is acceptable. I lay the blame for that squarely on the finance industry.
If we punch above our weight on the international stage then we are more culpable than we should be for a tragic lack of humanity.
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Morally iffy.
Oh dear oh dear oh dear.
What did Jesus say?
Let he who is innocent cast the first stone.
And whilst I cannot dismiss the views of those who see the actions as morally iffy, Stephen John, I can brand them as hypocrites.
Only perfect people need reply.
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Nothing illegal revealed in Guernsey, but I do seem to remember that when the EUSD was introduced it was welcomed by the finance industry as a major marketing opportunity for Guernsey to sell companies and trusts to EU residents to “mitigate” their tax liability.
This IS depriving EU countries of tax income, and is one of the reasons EU countries are anti tax havens, such as Guernsey. Low tax jurisdiction is a misnoma, but the activity discussed in Panorama is quite legitimate, rightly or wrongly, depending on which side of the fence you sit. P
This kind of tax avoidance is of minor concern compared to other activities which go on here.
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Arnald
I’m not sure which pubs you frequent but after a straw poll of nearly a dozen mates last night I can assure you that none of us have ever heard anybody boasting about assisting clients with this sort of activity. As ever with your postings, this appears to be yet another example of your malicious agenda of painting a misleading picture of Guernsey’s finance industry. This sort of thing is not widespread and local bankers are not boasting about it. I’m with Mike on this one.
Stephen John, I partly agree with you. The activities described in the TV programme in my view fall the wrong side of the acceptability line, and not just for a UK government-owned bank which has been bailed out by the UK taxpayer. The high street banks have a massive presence in Jersey relative to here, and so the position is far more widespread over there, but our banks and building societies should and I hope are properly filing STRs if they suspect that their clients are evading UK tax. I have yet to be convinced why Guernsey or Jersey insist on the right to apply the retention tax rather than going for automatic exchange of information. Make no bones about it, the retail offshore banking sector is a very big risk to the islands for several reasons, and risks undermining everything else that we do so well, and which is totally beyond reproach.
Of course Richard Murphy is in his element, although I hardly think that two put of around 85 banks in the islands represents a reliable statistical sample. It is also highly debatable whether, despite the reckless and foolish comments of the Lloyds employee, any prospective client would have got past the bank’s due diligence procedures. One would like to think not, but the vibes certainly arent good. If such behaviour is the norm at Lloyds in Jersey, or indeed here, likewise at Northern Rock, then the regulators must take appropriate steps. If that means withdrawing banking licences and bringing criminal proceedings for conspiracy to evade tax, ie money laundering, then so be it. We simply cannot afford to get this wrong.
To Arnald and Stephen John, until lawful tax avoidance is made officially unlawful by Acts of Parliament, it remains nothing more than the personal wish of those who take that particular moral view. Tax avoidance has been continuously ratified as being lawful for many decades by the courts, even though there are regular attempts by certain people to blur the distinction between lawful avoidance and unlawful evasion, and we are all becoming aware of degrees of lawful tax avoidance which are now deemed unacceptable. I don’t think too many practitioners have a problem with that, but the extremists who wish to seem all tax avoidance to be morally unacceptable are I’m afraid not going to get very far until and unless the laws are drastically changed.
It was suggested to me only this week that for the UK to balance its books, a personal income tax rate of close to 70% is required. Well, many are already baulking at the prospect of paying the new 50% rate, so its fair to say that the appetite for lawful tax avoidance is not going to erode.
But regardless of that, we must ensure that our house is properly in order, no matter how painful, although I continue to believe, despite Arnald’s wishful thinking, that we do not have a long list of banks operating in the manner suggested by Lloyds Jersey. If we do, then wecannit say that we havent been warned.
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Steady….Aim….
“The statement ‘theft from the poor’ shows an unbelievable ignorance of the role the Channels Islands play and their interaction with the UK economy.”
What a trooper!
Said with all the gravitas of an estate agent.
Who told you this? did you work it out for yourself? I worked out time/space dimensional travel by throwing myself off a cliff. What did you do?
Share a fine port with a fat man?
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oh Mike, you say tomato(e) and we say tomato, but at the end of the day, it’s the same ol’ fruit.
The English language is a fine thing, accidentally abused by the illiterate over the years, but deliberately so by those individuals and institutions who’s convincing arguments and clever use of words would have us believe that black is white and night is day.
The dirty tax dodging monies that hide in the Channel Islands, dressed up as Tax ‘mitigation’, have been a source of angst to those with any sort of morality since the whole fiasco started 30 odd years ago.
It’s a free world. You can dress it up as something else if it makes you feel more comfortable about the scandalous actions of the local finance industry, who keep Tax revenue out of the pockets of the same Government that bailed them out of the equally scandalous state they got themselves into in the UK with Tax payers money (many of whom now are unemployed, thanks to that) but no amount of clever or convincing wordage will convince the many who ALSO understand what it going on, and choose to view it differently, that the whole thing stinks.
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Forgive me if I’m wrong but I thought London City and Delaware in the US were two of the most unregulated areas to do financial business in the “modern” world?
Isn’t it odd that these two places exist in two countries calling for a clamp down on “Tax Havens”?
Anyone with more expertise care to correct me or add some meat to the bones of the above?
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Keep on digging, guys.
David, so a straw poll “do you talk about work in the pub?” what do you reckon the answer’s going to be considering it contravenes most privacy guidelines of the institutions?
Get these young lads drunk and they sing. Candy from a baby.
Your view of our operations has always been rose tinted. We’ve been sparring for more then two years, constantly repeating, but you’ve ALWAYS CATEGORICALLY denied that this shysterism exists here with any great presence.
How the hell do you think the big deposits are landed in the fierce competition? Which company will win
A. “Mum’s the word”
B. “We will be declaring every transaction you make to the relevant authorities as per the spirit of the code”?
So the cagiest and most underhand salespeople will always get the Porsches. You don’t need skill. I know. Just a nature that inspires greed in people.
I can appreciate the difference with PE and some of the fund stuff, serious investors wanting some action, but the lion’s share of our business is social degradation around the world. And still we have idiots coming out and saying how great it is.
With Gordon Brown pushing for a harmonised corp tax and HMRC talking tough, this narcissitic defence of scamming sociopaths makes Guernsey look worse and worse and will attract further scrutiny.
Where are our moral leaders? Where are our leaders? I await with some glee to hear Lyndon Trott’s angle. Will he have a pathetic pop at the BBC?
Are HR depts in the finance houses giving out buckets of sand to employees “Please immerse head for 24 hours a day, excl Christmas lunch – but then you must be drunk enough not to speak or hear”.
It has to be said that thre responses on the Jersey site are FAR more amusing in their delusions.
David, you can say I’m wrong til your blue in the face, but I’m playing fact bingo and more of mine are coming out of the bag.
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When I see sweeping statements such as this “Get these young lads drunk and they sing” I pay far less attention to the writer regardless of the subject. It shows that you are out of touch and looking for an easy scapegoat.
Please tell me why specifically “young” has come up and “lads”? Are you seeing the world through your rose tinted glasses whereby “young lads” are to blame for everything.
This suggests to me that you are following the bandwagon which so often blames the “young” as they are a soft target.
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Get oveur it.
Have you read the rest of the ‘sweeping’ drivel that has been bilging out of their mouths, these spivs? So I use ‘young lads’ when i could have easily said “middle aged mid life crises” or “****s”, it wouldn’t have mattered: the Guernsey finance industry is proud to be ripping off the poor.
Explain to me how not paying tax is beneficial to anyone except the person not paying the tax and the service provider that gets a fee?
Stop being smart and look at the facts.
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Here we go again.
I admit that the Lloyds Bank representative that was secretly filmed in that Panorama documentary was making statements bordering on incompetent and he appeared to imply that the prospective client was getting away with some sort of illegal activity – he was an idiot. However if you actually stop to consider that particular example, the bogus client claimed to have an offshore company which wished to pay dividends to its shareholders. As an offshore company it was free to pay those dividends any where it liked – it could pay them in the UK and pay tax or it could pay the in the EU and pay tax or it could pay them in Hong Kong and not pay tax.
The obvious choice is Hong Kong – but the crucial point is that the UK or the EU were not being ‘conned’ out of their rightful tax revenues – they had absolutely no entitlement to any tax revenue arising on those dividends because this was not a UK or an EU company.
The Channel Islands operate within a global environment and we are perfectly within our rights – indeed it is our duty – to ensure we provide financial services to our clients in the most tax efficent way we can. Provided we are not taking tax revenues from another country that has a legal claim to that money we are not acting illegally and we are not, in my view, acting immorally.
Who exactly is getting ripped off here Arnald? I have explained that neither the UK nor the EU had any entitlement to tax on those dividends so it is not them. Hong Kong has a tax regime which allows the dividends to be paid tax free so it is not them. Jersey would not gain any tax revenues from that particular transaction so it is not them.
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Arnald, how can you try and take the moral high ground when you are happy to also make sweeping statements. It seems you are sinking to the same level of those you are criticising. This, I’m afraid detracts from your argument, and that’s the point I am trying to make.
Further, a “Spiv” is one who historically dealt in “petty crime”, your arguments imply something greater, perhaps further proof of your contradictory nature.
Am I still being “smart” or in fact just paying attention to detail, something which many fail to do when brandishing their “tax haven” brush on everyone.
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As tax avoidance is not illegal then the tricks relating to mitigating tax losses, and many have been described in these Blogs over the past year or so are legal, although to some morally wrong.
What does surprise me is the indignation and claims that such behaviour as highlighted in Panorama does not exist in Guernsey. The programme revealed nothing that was new. If it is legal why not use every trick in the book, until the particular trick is seen in law as evasion?
Interestingly, the programe showed Northern rock’s statement as saying it did not condone tax evasion. Odd because no one accused them of facilitating tax evasion (illegal) but of helping a rich client to avoid tax (legal).
I would expect a competitive finance businses to offer tax avoidance solutions. After all the big accounting houses do it, companies do it, trusts do it and so on.
David is right in saying “To Arnald and Stephen John, until lawful tax avoidance is made officially unlawful by Acts of Parliament, it remains nothing more than the personal wish of those who take that particular moral view”
David
Do you see the advice given by Northernn Rock to use a non trading company as evasion or avoidance?
Likewise, do you see the use of an outside of the EU business filter money to avoid EU directives, as being evasion or avoidance?
Answers from any of the other Guernsey finance people will be appreciated.
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CD
Here we go again, is it?
Just look at what you’ve written. You are condoning the use of an international business to circumvent democratic national rules.
Who is being ripped off? Well that highlights most of the ignorance in Guernsey. You think this is all win win win.
Do you have any understanding about cause and effect?
Why should we listen to you CD. You are supporting gross immorality dressed up as respectable business. Why can’t you make the connections, hmmm?
Fat wage is it?
Got to get that new car, yeah?
That’s worth helping to rob the developing world of an annual £160B is it? Hiding the proceeds of crime? Prove it.
Prove your worth, apologist.
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Clarence Oveur
No high ground. Just common ground. We could do good finance if we were honest. We are systemically dishonest – at best we are ‘economical with the truth’.
You have no argument except for semantics, fine, but spiv sums it up quite nicely. It isn’t illegal you know. Just wrong.
Like racism. Or slavery.
Financial thugs.
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Arnald and other “Tax Haven” bashers. I ask you this. How is it that you know that what goes on is illegal? Is it because you work in finance centres, and facilitate such activity? Or is it just what you read and what you hear and then the conclusions you draw from these snippets that the media want you to have? I put it to you that if you work in these finance houses that are “morally iffy” why? Would your moral compass not guide you to say No, I will not be apart of this? Or are you happy to get your nice salary and pension and fringe benefits? If you do not work in this environment, then really how on earth do you even think you can possibly pass judgement with such authority???
As for hearing bankers and lawyers in pubs-please take that with the bucket load of salt it deserves – i would suggest that much of that talk is one-up manship and peacocking and is complete and utter tosh!
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“Do you see the advice given by Northernn Rock to use a non trading company as evasion or avoidance?”
Neither – I see it as information or advice.
“Likewise, do you see the use of an outside of the EU business filter money to avoid EU directives, as being evasion or avoidance?”
I do not understand the question.
Stephen – do you see living in Guernsey as a way of avoiding or evading UK tax?
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Arnald well said, you are correct in what you write as in many other articles you have posted comments on.
There is no doubt you are a person who is well read and informed.
Also it is highly likely you have read the book “The Ragged Trousered Philanthropists” peoples attitudes have not changed a great deal the only difference is the date 2009 not 1905.
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Arnald – my point is that we are NOT circumventing democratic national rules. We are acting entirely within international rules.
Explain to me, exactly how is it that an international company with no duty or obligation to pay tax on dividends in any particular jurisdiction is ripping off the developing world?
You talk about cause and effect but I would like to know precicely what you mean by that.
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Golden Brown
The article in the Press the other day was a clear indication of known evasion (and the further criminality that it hides).
On this subject I don’t think I’ve mentioned illegality.
As for knowing stuff, it’s called school.
Depends if you’re asking the lawyers/bankers direct questions.
Bob
If a publically owned company is only accepting investments through a shell company it means they are using instruments to over complicate transactions and so hide worth/identity for short term gain. The results are the credit crunch. Nobody thinks we had much to do with it, but our very existence and our international stance puts us right in there. We helped hide the problems from the regulators (who wouldn’t have bothered asking the q anyway) leaving them unable to get a clear picture.
If someone doesn’t like the tax regime in one country, they should physically leave. If they are living in that country they should pay the tax that everyone else has to. Wealth should buy no privilege, no absolution of responsibilty.
This is why there is a growing disrespect for what we do and for whom we service.
And this language we use to justify it.
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“If someone doesn’t like the tax regime in one country, they should physically leave. If they are living in that country they should pay the tax that everyone else has to.”
This does happen. They also take with them a lot of spending money and possibly further inventions/entrepreneurial skills which could lead to job creations etc.
Since 2007 the number of millionaires in the UK has halved and the number of billionaires has almost halved as they move to places with lower tax regimes. They have taken with them a lot of money that could have been spent on products and services in the UK they may even have set up more businesses if they had stayed but that is speculation I agree, further, charitable donations decrease quite substantially.
The UK have also made it more difficult for those who live in places with lower taxes who used to come back to the UK for 3 days a week to run their businesses. One would assume that if it continues to get harder then those businesses could move out of the UK with the loss of jobs.
It’s a cycle that is difficult to break. The tax rates go up to raise more money, the super rich move to avoid this, there is therefore a shortfall and thus the tax rate has to go up again.
I don’t claim to be an expert as my “specialist” knowledge is elsewhere, but I do find this to be an interesting debate.
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i wonder if Arnald claims mortgage relief on his tax return? Or does he uphold his beliefs and do the decent thing and pay full tax on his income?
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Arnald, I’m with you on this one..’SORRY’…….don’t let the ‘spivs’ get you down mate. You have rattled their cages so carry on. It takes a liar not to admit that money laundering goes on in the island. You ask any honest banker (yes there are a few over here) and they will tell you of the scams that take place. Money breeds contempt and crooks and the crooks out number the good ones over here. The banking industry is the most dishonest, deceitful and untruthful profession in the world.
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Several points.
First, all TV investigative programmes are made on the basis that the producer has a point of view to express and the reporter is only interested in obtaining “evidence” to support this. The fact that he might be given a hundred views contrary to his producer’s conclusions is immaterial and to be ignored as long as he can get a supportive quote. Was the real question put to the banker which elicited the required and quoted answer the same as that in the programme?
Second, as far as the UK is concerned many high tax payers feel that their tax payments are being wasted on a million Government – national and local – employees that add nothing to the well being of the country, merely themselves. That’s £30 billion of tax payers money wasted and why should we pay for it if we can find legal ways of avoiding the tax. Politicians bleating about tax avoidance is rich coming from those who have used every possible loophole to claim unwarranted expenses and avoid tax by swapping main residences. Physician heal thyself comes to mind.
Thirdly, the banter you might hear at cocktail parties and in the pub is almost invariably of unworkable schemes, the more outlandish the better. Professionals keep the real deals close to their chests as they do not want them pinched.
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Arnald- 160bio robbed from the developing world? Prove it!
One really should be able to indepedently substantiate such claims before making them.
And I like your reasoning for the credit crunch!! Maybe you’ve conveniently forgotten the abundance of cheap credit caused by blinkered central banks and abused by careless individuals?
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well said, arnald – if you don’t like the tax regime, you know where the airport is, don’t you……
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Arnald-
Which publicly owned company are you talking about? Did the programme actually suggest that one of these nationalised banks was ONLY taking money though clients’ “shell” companies?
So one can avoid the tax by leaving, and that’s OK. One can even leave one’s money behind and take advantage of non-resident provisions – apparently OK. As far as I’m aware, my clients do pay the same taxes that everybody else “has to”. The government creates the law and the loopholes and decides the “has to” bit as well. I’d rather they didn’t pay any more than the “Has to” for a number of reasons, not least of which is the concept of fairness. Without the “has to” threshold, all taxation would become subjective – “Bob’ll pay an extra ten grand this year, because I don’t like his shifty eyes… Arnald an extra fourteen grand, because we are a bit short this week and it’s his turn…etc.” The “has to” does actually apply to everyone – a cleaner could provide services through an offshore company should they wish. Oh, but they’re probably alredy on a cash-in-hand, undeclared income basis, so the DSS don’t stop their benefits, eh? But that’s OK – just as long as whatever they’re doing is not done legally offshore?
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I am heartened that they are now showing people how to legally avoid their own tax regime, through their nationalised banks. It was predicted that this sort of thing would occur when they bailed the banking sector out.
How can UK Govt. criticise us for what their employees (ant the banks or at HMRC) are doing?
As I have said before, we have a socialist government in Westminster. They have had years to address the entire tax system, and the loopholes that exist are by now, by and large, theirs. Government enjoys the sport, and it gives them an excuse to thump the table now and then. But no really serious effort to make the tax system either fair or transparent has been made. Rather than attacking other jurisdictions, the “onshore” world really needs to look at their own competitive regimes – Belgian CGT, Dutch holding companies, etc. Oddly, though, the morally justifiable route of putting one’s own house in order first seems just a little inconvenient.
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Bob
So typical of the attitude. OFCs do not need to exist in this form. I agree that international finance benefits from concentrated hubs of expertise. But to set up an industry for the wealthy to avoid tax is a construct that has proven disasterous. You can defend it all you like, Bob, but it’s crippling people all over the world. Socially destructive. So what are you defending?
It all needs rethinking, as do our priorities.
greg, do your own research. there are papers out there. read the counter srguments, make up your own mind about objectivity and social responsibility.
It’s just greedy ignorance, this pathetic stance. Just admit that you’ve had it easy when the times were good, and now you have to face the realities of your addiction to wealth porn.
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simplemind
But I don’t want to go. That’s the crux. A tax regime is imposed through misinformation, flawed logic and a WILLINGNESS TO ATTRACT MORE AND MORE OF THIS TYPE OF BUSINESS.
Our politicians are complicit.
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http://www.actionaid.org.uk/doc_lib/accounting_for_poverty.pdf
Just one very popular, and locally active, charity.
It proposes that the industry at its core, and whose chicanery we depend on, is losing the developing world more money than is given to it in aid.
So yet again, the public give money for a cause and the net effect is that rich spivs and scammers put it all in their pocket.
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Bob in response to the question
““Do you see the advice given by Northernn Rock to use a non trading company as evasion or avoidance?” replies
“Neither – I see it as information or advice”
Bob don’t you give such advice in the context of whether it is legal (avoidance) or illegal (evasion)?
Bob
If people live in Guernsey and work in Guernsey I don’t see it as avoidance nor evasion.
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Arnald is unfortunately still stuck in a 19th century concept of ‘poor’ and ‘rich spivs’. His ideas have probably been fermented through concentrated re readings of Das Kapital I think.
The broad Democratic Socialist govts of Western Europe hve lifted millions out of poverty-however, there will always be those at the bottom of society for which the welfare system was created to allevaite them from dire poverty and necessity.
Tax and morality have nothing to do with each other-governemtns need to raise finance for whatever their political or social agendas are or happen to be at that time-they do it by taxing us.
Arnalds views will never change-if he had a Red Flag, Im sure he would charge the steps of the Guernsey Kremlin if he had enough supporters.
Wonder what he would do if he won the UK lottery? Move to London and let them have 50% of the income derived on his winnings..whilst of course using the winnings themselves to set up numerous soup kitchens to ahem…feed the ‘Dickensian’ poor he so deeply concerns himself with…
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That’s not proof, it’s just another load of estimates from people who are in bed with your mate Dick Murphy and his crazed socialist/communist group.
But to be fair to them, they do at least have good intentions. But perhaps they’d be better off expending their energies eradicating the corruption in developing countries, which I would have thought is a far greater problem. Even if the tax take in developing countries was increased dramatically, do you really think it would actually be used to enrich the life of the local people, or be used to buy more Maybachs for the rulers?
And what is wealth porn?
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Arnald
Re your article on Action Aid, it seems that only last week Private Eye were pointing out that one of the trustees of Christian Aid is on the board of Resolution, a Guernsey company which itself has been heavily criticised in the media, including by Richard Murphy, for its role in relation to buying Friends Provident.
How ironic.
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You see, greg, how do you think that corruption is enabled in Third World countries? Surely not the multinationals, the accountancy and legal professions and tax havens, is it? This is a prime example of not following cause and effect. Did you actually read it?
If you’re going to have an argument at least back it up with some intelligence. It’s a bit like the smoking issue, there’s common sense and then there’s blind dogma.
ADAMCLAY
No. I base my stereotypes on my immediate vicinity. But yes, the language is deliberate because it shows how far we haven’t travelled as a race. The rich still believe they should be even more privileged than the luck of their birth place provides them. The stats are there.
And teh rest of your analysis is wrong. This has nothing to do with ‘redness’ abnd everything to do with international justice. Again, you are ignorant to the wider picture of capital flow.
Even faced with a clear example of how the rich are invited to absolve their social responsibilities by commission led salespeople, it would seem the head-in-the-sanders are still denying there’s anything wrong with that.
Apart from drunken right wing bankers, you finance functionaries are the only ones.
Yet here we see Guernsey needing to raise a further £40M or whatever, just to balance. Who will take that strain, I wonder? And yet you’re still in thrall?
Are they paying you in legal highs?
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David
It shows how out of touch you are too. The head of Christian Aid in Guernsey is the Dean. he has publically come out and rubbished Christian Aid UK.
I WONDER WHY? What proof has he got that the others haven’t? Oh yeah…..
I challenge them to come out and justify their position when every Church, every community leader, even politicians and the regulators are all coming out saying the same thing.
Is that the best you can do David?
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Arnald’s arguments are all very well if you believe that taxation is the only way that wealth can be redistributed in order to address such issues as global poverty. It is, in my view, a simplistic perspective which misses some fundamental points.
Offshore finance plays an important role in the free flow of capital around the world. That capital may indeed be owned by a disproportionate few, but one needs to remember that a massive chunk of it is reinvested in global equities, private equity, investment funds and directly into businesses. Most of those investments ultimately provide a capital base for industries around the world which ultimately translates into jobs.
Providing aid to developing countries has its place but it is often a short term fix and too often that money falls into the hands of corrupt officials and politicians (I have just got back from Africa and beleive me if you think our system is corrupt you need to go there to see what corruption really means).
On the other hand, I would argue that providing people in those countries with jobs will do more to alleviate poverty than hand-outs ever will. The free movement of capital and investment around the globe has an important part to play in this.
Say, for example, that Panorama’s bogus Lloyds customer had decided to pay his offshore company dividends in the UK (even though he didn’t have to and even though the UK has no right to tax those dividends), where would that tax have gone? Yes, some of it would have gone on useful stuff like schools and hospitals and government aid to developing countries (some of which might even have reached the people who needed it), but a sizeable chunk would also have been blown on inefficient government bureaucracy, red tape and cleaning out politician’s moats.
On the other hand if that individual prospered, in part because of efficient tax planning, he will have more money to invest. Lets say he invests it in an international global energy fund – and lets also say that that international global energy fund in turn invests in a company building a factory to build solar panels in a third world country. Not only has his investment indirectly provided jobs but also tax revenues for that developing country.
OK all this is necessarily very simplistic – but my point is that high rates of tax paid in onshore jurisdictions are not necessarily the answer to global poverty as Arnald seems to think. If you look a bit more closely at what we do we are often aiding free enterprise and wealth creation which, in my opinion, can do more to alleviate poverty than state hand outs ever can.
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Arnald, so you really think that abolishing the tools that the corrupt use means that they are no longer corrupt? Come on Arnald, if you’re going to try and engage in an argument at least use some intelligence.
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David
Good to see you are keeping up with the Eye. Good on educating the various skills involved in avoiding taxes.
You will also be awrae that the head of HMRC has had his fair share of criticism, something that makes his protestations about last Mondays programme somewhat hollow.
All goes to show that its people who mess things up whilst we love to blame the institution or and the structure.
I don’t know what to make of the GFSC pronouncement about something that is not illegal but brings Guernsey into disrepute.
Once again, did either of the two guys featured on the programme suggest actions that were illegal?
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Arnald
I’m sorry but you’ve lost me. What on earth has that got to do with the trustee of Christian Aid in the UK being on the board of Resolution and the double standards of that ?
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Stephen John
Sorry but I missed your posting of 23rd September (12.15) asking for my comments.
Do I see the advice given by Northern Rock to use a non trading company as evasion or avoidance?
It’s not entirely black and white based on what’s been published elsewhere about the meeting and which includes references to taking separate tax advice, but the crux is whether the banker interviewed knew or suspected or really should have reasonably known or suspected whether the “client” was not intending to declare the resulting interest. If the “client” was UK resident and domiciled then the interest was reportable and taxable on a lookthrough basis whether it is held in a company or not, so adding the company achieves nothing. There are instances, albeit not many, where people use structures for various valid reasons, not least administrative simplicity, but where everything is nevertheless declared to the tax authorities. However, this would be quite rare but in most instances in the circumstances reported one would almost certainly have to suspect that the client was not going to be reporting the interest and so this would be likely to be tax evasion. I think the client would have to come up with a very plausible rationale indeed for using the company but as it was seemingly the bank rather than his tax advisor who was suggesting it in this case, such a rationale does not appear to be present. As a result, this looks very much like tax evasion for a UK-domiciled and UK-resident client.
Do I see the use of an outside of the EU business filter money to avoid EU directives, as being evasion or avoidance?
Really a very similar answer to the above. In most circumstances, this looks like evasion unless there is a very plausible commercial rationale to justify it, which would be rare.
In probably 99% of cases with such circumstances as described, it would be difficult to reach any conclusion other than that it is suspected evasion. There are rare exceptions from time to time when a different conclusion might be justifiably reached, but the odds would be against it.
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Stephen J:
I give advice. It is what it is. The context changes dependent upon how the client reacts to the advice. If he acts on it, then one set of circumstances accrue. If he does not, then another set accrue. If the government of his country of residence change the law two minutes after I gave the advice, yet another set of circumstances could accrue.
If he sets out, in truth, every fact that is relevant to his situation, I will tailor the advice to be pertinent to his situation. What advice I would give would be based upon an assumption that he will declare everything he “has to”, as should he follow such advice that I gave, there would be no advantage in him not doing so. I do not wish to work for those that compromise any part of this. I prefer to be able to review clients’ circumstances at least annually.
In truth, the simple answer to your first question is yes – provided one has sufficient information to make a call, but in others we usually advise the client to take domestic advice – I know next to nothing about the tax of the vast majority of jurisdictions. One makes assumptions that their information requirements are at least equivalent to those in UK.
Incidentally, leaving a jurisdiction remains a widely used and highly efficient tax avoidance route.
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Arnald – as I’ve said before, I have some empathy with your general thrust. I just happen to disagree with every detail! Sort the governmental waste, make the tax law transparent and fair. Put me out of business that way and I’m happy.
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David
Apologies, I had heard about him, but I’d assumed he was Guernsey affiliated.
Can’t see that he disapproves of their thrust, so fair play. But he’s not selling aggressive avoidance schemes is he?
You’d think he’d stop bothering if they were so wrong, wouldn’t you? I mean they would have asked him, wouldn’t they? However, I have no idea what the PEye said.
Greg
It would make it easier to find out though, yeah? I mean they must be paying someone in a tax haven some good fees for the advice on how to be corrupt in the most efficient way possible.
CD
So have the developing nations, with their vast resources essential for the developed world every wish, seen proportionate advancement?
No. It doesn’t work. It doesn’t work because the rules are designed not to work like that. Otherwise it would.
The poor are getting poorer. There is only one reason for that. Selling products to avoid tax is a tool to enable those with privileged access to wealth to acquire more wealth at the expense of the majority. The proof is all around.
I don’t think I’ve mentioned what the alternatives are, so you can attribute whatever political influence you like on me, the bottom line is honesty, transparency and accountability.
This system is the opposite. Common sense dictates that it should be looked at in great detail.
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An short essay in grey; the colour of money?
Remember that grey is the financial services favourite colour.
The simple fact is that Guernsey has a different tax structure to the UK, the EU and the USA. Companies and individuals will always take advantage of such anomalies. Avoidance is not a crime but fraud is.
Grey will only turn to white when the men in blue move in. The nice men in high places will change the rules and send in the equally nice men in uniforms.
See how they run. A laundry analogy. If you wash black with white you always get grey!
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It is clear that it is the multinationals that are the biggest abusers of our anomalous status. I’m being told left, right and centre that the Fund servicing couldn’t be tighter.
But the other face of the argument also comes out. Our defence against the critics is based on our strict AML rules. If a client does not arouse criminal suspicion then the rest is LloydsCity. It becomes a bit of a game of semantics. However, saying that our industry in fact knows MORE than the other tax-losing jurisdictions about our clients and that it is those jurisdictions that are at fault is nonsense.
If an African dictator wanted to stick $250M in a Guernsey instrument, having been referred on from a Swiss WM specialist, it would be automatically suspicious that these transactions would not be declared. Our policy would be only to see if the money was clean. if the money was coming from a respected WM outfit, would we reject it? or would we say, well it’s up to that Third World Country to know all the account names and numbers, the products bought, the times and dates, the provenance of the original capital etc etc. How likely is that? If that country is so corrupted that no official would even be looking, let alone keeping paperwork, and it will have been done under accountancy firm advice, in connection with a multinat, using one of their hundreds of subsidiaries all over the shop….
Why would we not want to release all details to that country’s tax authority?
Us keeping the records is simply a KYA exercise. It serves no purpose to the outside world which is being damaged by this secrecy. if it isn’t secret than how come no one knows anything?
Automatic disclosure is the only way forwards for the Channel Islands. guernsey is in a far better position than Jersey.
GIFA should distance itself from banking and push itself above the dirty business grabbers.
Tax the foreign multinats.
Make them pay for the privilege of using our Island for such society breaking antics. It is the public that will pay for generations for their disgusting greed.
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Nonsense Arnold, if $250m came in from a Swiss WM specialist you can bet your life any Guernsey financial services provider would look straight through this to establish the source of the funds. If they came from a PEP (Politically Exposed Person as defined in the GFSC rules) who turned out to be an African dictator they would almost certainly decline the business.
Chances are the African dictator will have ripped off a proportion of that money from aid payments from the developed world to that country – paid for by the taxpayer.
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Arnald, in your example I think you’d find that the African dictator would not be able to place his money with any Guernsey institution, even if he was referred by a Swiss outfit.
If the funds were actually being invested by the Swiss outfit without reference to the underlying client then things may be different. However that would have nothing to do with offshore finance. If the well respected Swiss outfit approached a London bank wishing to buy a $250mio instrument they wouldn’t have any problem.
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CD, Greg, I don’t believe you. The PEP stuff is just risk management. We can see quite clearly that risk management is not one of the finance industry’s specialities. Cobine that with the failed Basel 2 and you really have to wonder why you should demand any trust from the public.
Are you saying categorically, CD and Greg, that there are no funds belonging to african (as a broad brush for a known corrupt jurisdiction) sources being managed through Guernsey that a layman wouldn’t find a bit out of place?
Would you stake your ‘reputation’ on it?
I have a feeling you have too much faith in your religion.
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Arnald, using the original parameters that you set out it would not be possible for the dictator to buy his instrument. Your last post is completely different to the one where you lay out your hpyothetical situation.
Whilst I appreciate you have little experience/knowledge of the finance industry, it is a little daft to confuse PEP “stuff” with that of the failed risk managment function which allowed the huge build up of exposure to toxic assets in many banks!
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Arnald, I obviously cannot speak for other organisations but I can categorically state that the firm I work for would not accept funds in those circumstances.
The “PEP stuff” as you call it is not just risk management – it is part of the official rules laid out by the Guernsey Financial Services Commission that we all have to adhere to. If we failed to follow those rules they could revoke our fiduciary licence and put us out of business.
Back in the old days before Guernsey became properly regulated is probably fair to say that some “dodgy money” passed through these islands but that hasn’t been the case for many years.
To be honest I don’t really care what you beleive, I know for a fact that I work in a well regulated industry where the vast majority of us act professionally and within the law. I will never be able to change your ethical or political stance – I am a capitalist and you clearly are not – but you are way off the mark when you suggest we don’t care where the money comes from.
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I haven’t confused anything.
I’ve said that the calculation of risk, be it corporate exposure or human morality is seriously flawed in the finance industry.
You may think it is acceptable to service an African State, State Owned Oil or Mine Corp, through Swiss, BVI and Cayman subsidiaries, but you see, to me, that’s theft from that African State.
The only reason that structures like that exist is to hide the trail. Otherwise it would be a simple deposit, no? In their own name.
Why are there so many subsidiaries in Guernsey. What do they do. Why can’t all these people have accounts in their own name?
Risk has never been taken seriously. Guernsey will learn as more of these rotten cases iof corporate greed come out that it should have thought harder about preserving whatever skill we pretend to have.
If you’re so smart, greg, maybe you can tell me what benefit some of our more ‘esoteric’ products have on the wider world.
Come on, if you’re hell bent on laughing at me, show me some proof.
Just empty words with no basis in reality.
I’ve seen those accounts, smarty. You’re wrong.
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CD
Very well said. You saved me the job of reminding Arnald that he really hasn’t got a clue about how well-regulated the local finance industry is.
I was going to jump on his earlier comment: “Risk management is not one of the finance industry’s specialities”. Arnald’s problem is that he continually destroys any remote credibility in his postings with a deliberate refusal to distinguish between the type of activities carried out by Guernsey’s finance industry and the activities carried out by those elsewhere who caused the global financial collapse through reckless lending. I know Arnald will come back and accuse Guernsey of somehow playing a major role in all of that, but we know to ignore that.
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To Mike, up the top somewhere
“I am more than happy to hear and even be persuaded by reasoned discussion supported by factual argument. Unfortunately many of the post made on the subject of Guernsey, Channel Island etc are neither and therefore it is not unreasonable to challenge those posts.”
OK, why are Northern Rock only accepting business from a shell company?
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David tells us how well regulated Guernsey is.
This might well be true of certain sections, but even the most ardent GFSC fan can say that waiting to see what a discredited regulator such as FSA, had to say about Landsbanki was good regulation.
Fiddling whilst Rome burned, and ignoring so many obvious and less obvious signs that should have been picked up by the GFSC, even if the FSA failed.
A blot on the financial regulatory landscape
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Bob claims “Incidentally, leaving a jurisdiction remains a widely used and highly efficient tax avoidance route”
It might well be for those with whom you frequent, but many come to Guernsey for many things such as family living there, spouse who is an islander, work, the “Guernsey factor” etc.
I would remind Bob that those like myself, who retire and leave guernsey for the UK don’t do so as an efficient tax avoidance route, but because of the hole that Guernsey is getting itself into – a hole that becomes greater by the day.
The Guernsey of the 1980s and its attractions as a place to live have significantly been reduced.
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Arnald, what’s the point in explaining complex financial instruments to you when you don’t really understand the basics? For a start, PEP “stuff” is a compliance function, not a risk function.
Also, why should a product have a benefit for the wider world? Do you ask an artist why he is painting, as his finished product doesn’t benefit the wider world?
I agree that some areas of finance (for example Private Equity) do seem to benefit hardly anyone, but there is plenty of activity that does. I work with some large pension firms who are providing for people’s retirment. Of course they are getting rewarded for doing so, but they are still providing a benefit.
And on another of your points, risk is taken extremely seriously (although perhaps more so since 2007) in Guernsey, and there are at least 3 outfits here who specialise in independently monitoring risk for clients.
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Priceless
David doesn’t know that Guernsey was involved in the toxic debt, greg thinks PE is useless and also thinks an artist has no social worth.
Is that the calibre of the counter argument?
David, greg thinks your career is worthless.
PEP is compliance, yes, but it is a risk based decision to allow PEPs onto your books.
Pensions?
What benefit?
You’ll be taking a fee for watching bad performance? WHat do you invest those pensions in? Are you buying secondary shares? What sort of benefit does that bring? It’s just gambling. A dog could do it. It’s not clever.
Well done!
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Greg
I say you, i mean the ‘large pension firms’.
Have you ever looked at the structures of pension funds? Do you know what they actually do?
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Arnald, I create short positons for pensions to protect their portfolios from adverse market falls. I doubt you will grasp this simple concept. And I know a dog would also struggle.
But I am more surpised by your defence of PE (although maybe you think I mean physical education?). I personally think PE does little for the wider world’s benefit, and is more just a round of clever financial engineering to make the PE backers wealthy. I know the PE boys will claim it forces companies to be more efficient, but I’m not sure this applies to a huge amount of deals.
And please show where I say an artist has no social worth? All I said was they provide little benefit for the wider world. Which is very true…his work only benefits those who can view his work and who those who appreciate his style. He doesn’t benefit anyone, he doesn’t cure the ill or protect the vulnerable.
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This is a bit like a drunk bloke in the pub confronting the customers – pulling off his jacket and shouting “come on I’ll have the lot of you if you think your’re hard enough” !
Perhaps someone should grab hold of Arnald and say “leave it mate, they’re not worth it”.
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Greg
You make some good points.
Sadly comments such as “Arnald, I create short positons for pensions to protect their portfolios from adverse market falls. I doubt you will grasp this simple concept” detract the reader from the thrust of your argument.
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Sorry Stephen, but some of the participants of these debates do cause a feeling similar to that of banging your head against a brick wall!
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Oh dear Greg. Think what you like. Your inability to grasp the basic concept of social responsibility tells me all I need to know.
An artist IS society. They represent the cultural identity of the place they inhabit. A society without art is not a society. i’d say it ranks higher than your piddling transactions. May make you feel important, but those pensions DON’T NEED TO BE THERE. It’s fake. Pretend.
Who said I was defending PE? I was laughing because I know how protective some posters are about how worthwhile they are. So I’m quite pleased that there is now some infighting.
I say your shorting is nonsense too. But there you are.
CD
It’s because you don’t answer questions. You just patronise. I don’t believe your stories. They do not tie in with observable truth. You are deliberately, and in public, misleading the readers.
Our regulations mean nothing in the wider world if they are not used by the wider world.
Do you agree or disagree with that statement?
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Arnald
Oh dear. Where do I start ?
Firstly, of course I know that some Guernsey vehicles were involved in toxic debt. What you fail to distinguish is whether the vehicle itself was administered here, or was it advised from here. The “risk management” difference is massive.
Secondly, what on earth are you talking about when you say: “Greg thinks your industry is worthless.” Greg was referring to private equity. I have no involvement whatsoever with private equity and never have!
I really don’t know what planet you are on but I don’t recognise it.
Stephen John
There are very mixed views out there about the FSA’s role and the GFSC’s role in relation to the Landsbanki collapse. At no time was the Guernsey bank insolvent until the UK Government recklessly froze the upstreamed Heritable monies under the anti-terrorism (oh, come on !) rules. Of course the FSA is deflecting criticism from it’s own failings, and also the failings of the UK Government to share vital information about Iceland’s financial position with the FSA which turned out be rather crucial information !
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Arnald, you are a funny guy, and your comments re art and society are just priceless. It all makes a lot more sense now.
And I’m sure when you are retired you might have use for a pension?
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Is my creativity not equally a thing of beauty, a joy to behold? No? I could weep.
Why would anyone value a painting or sculpture adorning the wall of a capitalist more than his beautiful offshore structure? There’s more cash hidden in plain sight on walls and on plinths than in Guernsey.
Am I not society, then? Is not David, Stephen, Greg? Are we not more typical of Guernsey society than a bloke that chops sharks in half, then pickles them?
Heritage assets, anyone?
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push, push.
Since I don’t have a reputation to defend my arguments get more stupid the boreder I get. I’ll stand by my comments on the arts though. The value may not have a quantity but it is completely essential.
I’m still to hear a robust defence for what it is you guys do though. You are unable to counter the claims of the critics. When they prove a point, you dismiss it as a ‘one off’.
Saying that Guernsey is well-regulated is not enough, being verified by an effectively in-house group of ex bankers and similar is not proof. The model broke and you fail to recognise the truth.
The industry needs to employ people that look at the spirit of global trading and ask the questions about social validity. That way maybe someday products are designed for positive and progressive purposes instead of the destructive individualist wealth preservation mess we are in now.
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Can anyone tell me the difference between:
Avoidance and Mitigation-
Is it like having a mistress_ or calling it a ‘bit on the side.
‘cos all the fancy words in the world doesn’t alter the fact as it is truly known.
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Arnald
What really grates with me about you is that you seem to participate on this forum with the primary objective of winding people up. Yes, we know that you are a socialist dabbling with communism, and of course that’s fine. But you do it in a manner which is deliberately aggressive and hostile.
But actually that doesnt wind me up half as much as the fact that I and the various other parties who you take such perverse pleasure winding up, as well as all Guernsey taxpayers, are actually contributing towards your salary while you spend all day on the Internet churning out your vitriole. Yes, I know that you work for a taxpayer-funded organisation and I would far rather see my taxes be used to employ somebody whose job is actually necessary. Yours clearly cannot absorb more than about 4 hours a day judging by the frequency of your contributions to this and other forums in which you take great pleasure in spreading your malicious lies about Guernsey to the outside world.
So you see you are attacking Guernsey’s main industry which generates the tax revenues which enable you to be employed in your job, a job that is clearly one that should be quickly deemed to be an unnecessary luxury as per the Tribal Helm report. No wonder your comments attacking suggestions that the public sector could be trimmed are so passionate. You would be directly affected!
Before you accuse me of hypocrisy, I and several others who battle with you on this forum to counter your lies work 60, 70 and even more hours a week to generate the profits which keep this island employed through taxation. We can choose what time of day we will use to pit in our many hours. So I choose to spend an hour or so a day countering your lies because somebody has to. Most of the time its very tedious, and I’m rapidly losing interest. I’m particularly losing interest in the thought of working hard so that a freeloader like you can use my taxes to earn a living while you spend all day on the Internet attacking us with your lies. Frankly, I’ve had enough. And I think its time that your boss, let’s call him “S”, took a look at your office computer Internet hard drive so that he can see whether your job is really a full-time job. It won’t take him long to draw that conclusion.
I’m sure I won’t be the only contributor to this blog who will be interested on knowing that we are paying you for the privilege of being continually wound up by you.
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You see. Can’t take me anywhere. So you spend all the time under the sun to do what exactly? You’re not doing it for us, don’t be so condescending. That takes the biscuit.
If you’re clean, you’re clean – although we’ve only got your word for it – but as demonstrated there is a lot of business herer that has dubious intentions. You seem happy with that, I’m not. Your denials are as damaging as any twaddle I come up with.
I expected a savage response to the confirmation that our existence is just a way for rich people to get richer at the expense of the poor. I expected a call for a root and branch examination into our suitability as a member of the international community. You know the one that has billions of people in poverty.
But no. The BBC is biased, the critics are communists, we’ve signed 14 TIEA (proven worthless by the Liechtenstein arrangement) mainly with countries that are insignificant or chasing their own whiteness. What about the hundreds of other countries? Why aren’t we actively advertising our desire to be transparent. We are not. That is because we would lose business. That business is to extract as much wealth from the real economy and to hide it in pretend empires and do deals amongst themselves.
I don’t see why I should have to accept a word you say.
Ever heard of holiday? Fridays in the sun are always v pleasant, thanks.
Oh, and seeing as you’re omniprescient, why don’t you ask the people I work with whether or not I am valued.
Own goal.
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Oh, and how could I possibly be damaging the industry? Does that mean that Lords Turner and Myners are? Or Sarkozy? What’s your point of reference? Greenspan?
That posh idiot banker that heckled at the Manor House Turner speech?
The entire Guardian newspaper everyday for the last two years has had story after story of financial depravities caused by the rich to enable them to make billions poorer. Why can’t you see the proof?
Attacking little stupid ole me seems trite, considering the unapproachable heights of hyper-evolved humanity the industry believes it exists within to issue these decrees from.
Let the public moan if they can be bothered. You’re all quite happy to attack the politicians for not doing what you want, but woe betide I mock your socially useless profession. At least they are forced to think about other things except for their wallets. Mostly.
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Arnald
I suggest you call a public meeting to see exactly how many islanders support your extreme views. It won’t cost you much as you won’t need a big room.
And if you are claiming that you are only blogging while on holiday, then you clearly have far too much paid leave, which we the taxpayers are paying for. And given the sheer inability of the public sector in Guernsey to get value for money, its no surprise at all that you think they value what you do. Its all relative.
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David, you come across as reasoned and reasonable and logical and moderate in your postings.
Arnald, you come across as bitter and twisted and extreme.
David, don’t allow yourself to be wound up or you could end up a little – a very little – like Arnald.
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The End Of The World Is Nigh!!!
I was born for the sandwich board.
I don’t expect anyone to listen, David. I find people that work in finance have very extreme views about what they do. I am merely reflecting the culture I live in. And lighten up. It’s a parochial paper comments forum, not some sort of widely read news-site.
Is me saying what I say really more damaging than a PwC backed article telling tax evaders not to bother running to Liechtenstein, and so averting an ‘exodus’? Or a trust co being involved in a legal but gross abuse of their company position to enter into high risk and unrelated business? Or any SFO investigation? Northern Rock? Landsbanki?
Or the constant faith in the big accountancy firms despite regular and serious cases of fraud or related?
Enron? Where do you want me to go with this? The industry produces damaging scandal after scandal. This recession is entirely the fault of a few big arrogants.
Why the hell shouldn’t I be bitter and twisted when the services my family needs are going to be cut to ‘keep us competitive’? Why should I have no right to make my feeble noises?
Who, except the public sector, will be mitigating the damage caused by the finance industry, who will be squaring up against the desperate rioters in the UK in 24 months time?
And when the workers go on strike because they have to have pay and job cuts caused by the finance industry, what do you think the responses in caring Guernsey be? “Disband the Union trpublemakers”, maybe? Or “they should be happy they get any money for what they do the lazy layabouts! Or what about, “sack them all and let someone who knows what they’re doing to run it!”
Nobody it would seem has the right to accuse the bankers. Yet in the space of a few short years, they have wreaked havoc on people’s lives.
Any other industry would have got hammered. If the same had have happened in the public sector what do you think the mood would be?
I’ll stick to commenting on other subjects now this latest farrago has died down a bit. How long until the next?
Doesn’t inspire much confidence or pride. Something that is important for the public to feel.
But you’re right. The chances are it’s just me.
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Martino
That’s very good advice indeed. Heaven forbid that I become anything like Arnald.
Arnald
I have little problem with your opinions. But I do have massive problems with what you maliciously post on this and other blogs, particularly when you try to add credibility to your postings by claiming to have witnessed certain things at first hand as a finance industry compliance officer, which of course you arent, and that tactic was totally despicable. Its very hard to forget things like that as it indicates that you will go to unacceptable lengths to try to achieve your agenda. And you have the brass neck to claim that the finance industry lacks morals?! That was one very big mistake on your part and I’m sorry but I have found it impossible to bite my tongue ever since.
But hey, life is too short and I certainly have better things to do with my time.
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I’ve come to the conclusion that the best way to deal with Arnald is to totally ignore him.
Let argue with himself if he wants to
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My my look at all the protests going on. Who are you all trying to convince? Others or yourselves? All seems to me as an outsider as bit defensive, maybe guilty consciences talking…
Not sleeping easy knowing deep down that your wealth is derived by scamming and cheating?
Is the defensiveness coming from a worry that we are only in the eye of the storm that is the GFC and that there are changes acoming?
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David.
I have never said I worked in compliance. Do you want me to send you my CV? Do you want me to name names? I have nothing against the individuals (except when knowingly corrupt – I believe that is rare) but I have everything against this complete denial of responsibility.
I have nothing to hide. You are using your unfair advantage of knowing who I am, who my bosses are and what I do. Your conclusions are wrong. And the deliberate use of that knowledge on a public forum against someone using anonymity, and who is not a vested interest or a public figure, is crass.
Just because you cannot prove that what I’m saying is wrong. Why do you take it personally. Blame the secrecy jurisdiction for your disability.
I have a genuine human concern backed up by the only research that is available surrounding the secrecy we promote.
What have you got?
A failed ideology and a direct theft of trillions of public money just to save your job?
So that’s reasonable is it?
That’s the problem when folk keep secrets. The effort requires the lies to be based upon a realistic fantasy. Their lives become a delusion and it spills in to all aspects of their lives. It erodes the soul. It harms mental health. I can be quite honest and say it harmed mine. You may have noticed :).
I feel privileged to have understood that.
What price some integrity and honesty in Guernsey?
Where are the moral role models?
(Really, won’t someone please think of the children?)
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Arnald
It might not have been “Arnald” who falsely claimed to work in compliance, claiming to witnessed certain things. It may well have been before you changed your identity to “Arnald”. So I apologise to whichever of your personalities I may have falsely accused, but not to the other one. But it doesnt make it any less despicable to have tried to falsely mislead the outside world that you “knew” of things going on which undermined Guernsey’s reputation. Sorry but that is just disgraceful.
If I have allowed my sheer disgust at that behaviour to influence my subsequent rapport with you then I apologise for it. But I wasnt going to just sit back and let you make such scurrilous claims against Guernsey on this blog, on the related This is Jersey blog, and on Murphy’s Tax Research blog,slandering the island just to achieve your agenda. Your postings show clearly what you stand for, and that’s fine, except when it comes to making false claims.
Anyway, enough said, time to move on and to put this behind us going forward. But rest assured that I will pounce if I see you trying that underhand tactic again. There is no place for that.
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‘And you have the brass neck to claim that the finance industry lacks morals?!’ What a corker!
It’s been fun watching Arnald taking you all apart. Not a let to stand on. Thanks for the show, guys.
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David
Re your 3.54pm of 25 September response about regulation.
T no time did I suggest the narrow view that Landsbanki Guernsey was insolvent. That was not the regulatory issue. The broader concerns about the Icelandic economy and particularly the Icelandic banking system were well known and understood by many except seemingly the GFSC.
To blame the failure of the GFSC on the UK government and FSA, both of whom were widely recognized as useless only highlights the incompetence of the GFSC.
You might well do a Lyndon Trott and use the Promotory Consultancy report as a vindication of the role of the GFSC. Most on this forum saw it as a whitewash carried out by a former FSA employee. Independent? I don’t think so.
Surely a competent regulator, with the resources and manpower of the GFSC should be able to make its own mind up, on what was a well known set of concerns about the wider Iceland economy and its banks.
If the answer is still no then lets shut the shop whilst the going is reasonably good.
David
In your increasingly personaal dialogue with Arnald you take him to task for suggesting that things may be amiss in knowing what is going on to damage Guernsey’s reputation.
But didn’t the GFSC man suggest that Guernsey’s repute was being damaged in his rebuff of the Panorama programme. So someone is up to no good why else would he say so?
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David
What I witnessed was well-regulated day-to-day business. It just so happens that that business was the one being described by all these “attackers” of the finance industry.
But I don’t mind you saying otherwise, after all I don’t think there’s anything I’ve said that hasn’t been said by some commentator or other in the media.
Which is why I find it quite surprising that you deny they exist or that they have any immoral intention.
I have no wish to destroy anything, only to establish how much of our business is not based around a desire to cheat governments and to argue the point that our microcosm of Award Ceremonies (company that best curtailed funding for the societies that educated them and for those societies that don’t have any schools at all) and pointing at each other’s golf clubs is at complete odds with the state of the wider world and their bewilderment that they keep being held back by middle aged white men with megalomania.
How can I be scurrilous or undermine a reputation of something that has a bad reputation and is socially useless, if not worse?
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All this is entertaining but I’m likely to be more than a little peeved if it’s true I’m paying taxes to help Arnald post away – or are his posts some form of performance art conducted in a new media style??
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Stephen John
I’m saying that vital information about the Icelandic economy, and specifically about its inability to dig itself out of its problems, was known to Chancellor Darling and not passed on to the FSA, who are meant to and generally do share such information with fellow regulators. If the only way to access such intelligence without relying on fellow regulators is to rapidly expand our intelligence resources in multiple countries then the current debate about spending £200k a year to maintain an office in Brussels would pale into insignificance. That is precisely why regulators are meant to co-operate. Chancellor Darling is far more culpable for the Landsbanki’s collapse than any UK report is likely to admit.
And I’m not condoning what the Panorama programme stated. I’m saying that one single reference to a Guernsey bank, which was nowhere near as serious as the Lloyds Jersey allegations, does not in any way indicate that this is what Guernsey’s finance industry is all about. Some people recklessly draw such conclusions because it suits their personal agenda.
Arnald
If you wish to change things then stand for election and see how far you get.
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David
What a weak apology for a weak regulator.
Regulators with the manpower and cost base of the GFSC are supposed to know what is going on.
Thed fact that Darling was caught out should be no surprise. All the knowledge he had was in the public domain or self evident from the facts.
What the regulators did was to tick boxes rather thaat interpret facts.
Reading the finance bits of the Daily Mail would have scared most Icelandic punters without blaming the hapless Darling.
Bit like lying in the middle of the road and blaming the driver who runs you over, when you should have made sure you were safely tucked in bed with your money under the pillow.
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Stephen, if you think the GFSC has the manpower and money spent on it to act full independently of other regulators then i’m afraid you are very wrong.
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Greg
Read again and you will see I am speaking specifically of the Landsbanki catastrophe.
There was sufficient concern both in the public domain, and available to any reasonably competent regulator, to have placed the island away from the Landsbanki risk well before the fall out of October 2008.
As the GFSC man said in the Press a few days ago, there are certain things which whilst being legal, bring Guernsey into disrepute.
Landsbanki fits into that category.
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Greg. So are you saying they cannot do the job properly? They can’t work with regulators without a disaster, and they cannot afford to work with them.
Tick, check, tick, check – nothing to do with me guvnor look at all my ticks.
What a farce. An operation that can harm a global population with regulation that only covers if an already known gangster tries to open an account. It’s a pathetic state of affairs.
So we’ve got fraudsters, gun runners, bank busters and chief pornographers but a regulator that can’t spot a failing institution until the public tell them.
top top white-listed business.
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Well a few think I am a simple man. or perhaps they meant a fool,
So may I indulge and ask a foolish questing, and in it’s simplicity.
If it isn’t a Tax haven, then why isn’t it run run in say England or the UK. or France, or anywhere else. or just a normal way of banking.
Do they really believe that we swallow what they say.
What is Normal % of income tax for the downtrodden of Guernsey. and what % for the ‘Big Boys.?
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Arnald – can you tell me where the pornographers are please. Thanks.
I’m also getting myself castigated for commiting the dreadful crime (tax evasion) of paying the plumber cash 17 years ago – which obviously has caused the suffering of the entire population of Zimbabwe in the intervening period.
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Arnald asks Greg “So are you saying they cannot do the job properly?”
Seems the logical interpretation of the statement.
Bit of a worry really if a top class finance centre cannot do its own regulating, even when the facts bite them on the nose.
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Stephen John
Using your example, why were Landsbanki and Kaupthing therefore not closed down by the massively-resourced UK FSA before the brown stuff hit the fan ?
Sorry, but Darling went to Rejkavik, met the Icelandic Finance Minister who told him that Iceland’s position was so bad that the fund which had been earmarked to bail them out had been exhausted, and then Darling returned to the UK and failed to/chose not to notify the UK FSA, who in turn did not notify Guernsey or the Isle of Man where subsidiaries were operating. That information would certainly have triggered action from both the UK FSA and the GFSC, but instead the balloon went up and Darling chose to bizarrely freeze Heritable UK funds, belonging in fact to the Guernsey bank, under the anti-terrorism act which triggered the Guernsey bank to become insolvent.
If the alarm bells about Iceland were so obvious, why did the UK and other jurisdictions with far more regulatory resources not hear them either until it was too late ?
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David
I don’t give a fig about what the FSA did or did not do.I am concerned with what Neville and GFSC did or did not so.
Now you really are worrying me when you seem to be suggesting that there were not alarm bells sounding about Iceland and its banks.
To paraphrase the Commons Select Committee chairman when told the same thing by, I seem to recall, the local government chappie “The alarm bells were ringing loudly”.
Why don’t you read on the press letters page the excellent appraisal by the Landsbanki protest chap about the missed opportunities to do the job they were paid to do – regulate.
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Did the staff at the bank know what state the Icelandic bank was in, that it was upstreaming to?
If they did, was it not practice to alert the GFSC then? After all, there must have been some discussion around how to increase the amount sent back without breaching the rules.
Either way, it highlights the paucity of real world thinking in the finance system generally. It talks all mighty and global, yet relies on parochial regulation.
When it fails it’s all someone else’s fault. Even though the industry clamours for less regulation and less intervention (beforehand).
Chancers, really. I mean, the rest of the world is undoubtedly jealous of our ability to hold a straight face whilst the bad news just keeps on coming in. A Times article is not ideal.
Gilthead
There are porn funds. One hedge did 20% growth last year.
Be on CISX soon, no doubt.
Yes, you obviously understand the issue fully.
I’m tilting at the wrong windmills.
Plumbers! Grr!
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Eric – not foolish questions at all. I hope I can help answer them.
The normal rate of income tax for the downtrodden Guernseyman is 20% – exactly the same as it is for those earning big money working in Guernsey.
Unlike in the UK, a Guernseyman doesn’t have to pay Inheritance Tax, Capital Gains Tax, Corporation Tax, VAT, higher rates of Income Tax or Council Tax so he doesn’t really do that badly in terms of taxation. (Although I would agree that the downtrodden Guernseyman has other problems to deal with such as the inefficient way our government works)
Some individuals and businesses can, depending on their circumstances, move around the world and choose where they want to live or base their businesses (and therefore choose where they pay tax). Guernsey is an obvious choice because, (like a Guernseyman) they too will have very little tax to pay here.
The important point to note is – if those businesses or individuals are liable to pay any tax in the UK or a European country or wherever – then they must pay it – or we must pay it on their behalf. We are not allowed to accept money in Guernsey in order to help people from evading their tax bill in another country – that is illegal and we don’t do it.
All the businesses and “the big boys” who are able to use our services are not conning another country out of their tax dues – under their own tax rules those countries have absolutely no legal right to tax them in the first place.
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Stephen John
You aren’t listening. Of course some alarm bells were ringing, as they were in Ireland. Iceland was in trouble but how much trouble? Enough trouble for their entire economy to collapse? How would the FSA or the GFSC know the true extent of the problem ? Well, Chancellor Darling knew and chose not to share the info.
Regulators in jurisdictions share info. Its how they operate. Otherwise they would all need to have their outposts in every other jurisdiction. Blimey, even the States of Guernsey wouldnt waste money like that.
Nobody is denying that the Icelandic economy had problems. But it was lack of knowledge of the true EXTENT of the problems which caused our problem. The local bank here was not insolvent, despite Iceland’s problems, and had no problems until the UK intervened by freezing the Heritable assets. This was largely to mitigate the UK’s risk after Darling’s failure to pass on what I’d had been told.
We can agree to disagree, and it looks like we will have to, but I don’t think the GFSC or the Guernsey bank are anywhere near as much to blame as you believe. Yes, a Guernsey bank went down and yes, it was regulated here, but where precisely was the local failing? ,
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Arnald, what is so wrong with a fund that invests in a legitimate business such as pornography? Sure, it might not be to everyone’s taste but should that make a difference?
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Nothing really, if that’s what you want to do. But what about all those investments that are made without the person knowing. The pension funds etc.
Also, porn is not a clean industry. Yes, there will be those that work within it that volunteer, however brainwashed, but it doesn’t take a genius to wonder how vice is primarily funded and executed.
The interview with the fund manager was revealing. He makes a personal decision to what is and what is not acceptable to invest in. He was unable to define the parameters.
Do you want your pension to be invested in some of the more niche and legally dubious activities?
Should we be encouraging investment in an industry that obviously corrupts the young.
Not that it’s happening here, but the attitude of the leaders would not stop it happening.
Would the Guernsey population accept that it was helping the growth of porn?
I dunno. Maybe. I wonder what the church would say. Not a lot. It doesn’t really do morals in Guernsey, does it?
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Arnald – I’d love to be enlightened on how a porn hedge fund operates. Fire away…
I would have thought it was rather simpler than that. Straight up and down I’d suggest.
Frankly I find your posts Naive in the extreme and you show utter ignorance in the way you approach your criticisms. When challenged you either ignore them or spout other contrived nonsense.
Top marks to David, CD and others who can be bothered to even attempt to counter your sillyness.
And back to thread – the Panorama report was one of the worst pieces of investigative journalism I’ve ever seen.
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David
a number of posters to this forum have, like myself, stated they looked at Landsbanki in the early part of 2008 and read on the Internet reports from various sources stating that it was not if Icelandic banks would fail, but when.
Perhaps we individuals were better at sniffing out a bad one than the so called professionals.
As far back as 2006 there were concerns about the Icelandic banks. There were serious concerns about loans and who they were to, there were concerns about the sky high interest rates in Iceland.
So, far from failing to listen as you suggest, I and others were tuned in to the unfolding catastrophe.
As a consumer my perceptions (as well as others) are important as to us they are reality.
I can assure you the failings of the GFSC were serious and forseeable. But than we investors were looking at the real picture and not ticking comfort zone boxes
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Arnald, couple of points. If an investor has strong feelings about where their cash is invested, they can direct that it’s not invested into areas that they disagree with. This is probably most prevalent for Muslim investors, and to be honest I don’t think many others are that bothered!
I’m not sure pornography “obviously corrupts the young”. That sounds like a bit of a sweeping statement!! As is talking about brain washing! I’m sure the “stars” of adult entertainment such as Jenna Jameson etc might have differing views to yourself.
I’m not really concerned what the church says!
Gilthead: I got around to watching the Panarama episode last night. I must say I didn’t realise the BBC had reached such low levels….it was absolute rubbish from start to finish!! I wonder why they didn’t show the footage from Northern Rock as they did for Lloyds? Maybe it didn’t quite happen as they say?
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Gilthead
The Panorama piece was not designed to win a Bafta. It was populist and shallow. But what you’re saying is that it was inaccurate. I don’t think it was. I have heard that language and I know how renumeration works. It is completely nonsensical to argue black is white on this case. They chose one part-nationalised bank and got the result they expected in one go.
You do the maths on the probability of it happening if 99.9% of business is not like that.
It is not naivety, mon vieux, I may over colour my posts to play to a gallery – mainly myself, but the intention of our business is clear. The client base is clear.
Our defence of it is vulgar.
If we are so GOOD then why do we need the business of cheats? Why are these products sold as a way of absolving civic responsibility?
The basic mentality sees tax as optional.
The world would fall apart if we all did that.
Pure exploitation of privilege, nothing more or less.
It is not sophisticated or world beating.
Opportunist thievery.
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Stephen
The bank in Guernsey was the one regulated by the GFSC. The bank in Guernsey was not lending recklessly and it was not engaged in aggressive activities carried out in Iceland and UK by parent/associated banks. The GFSC can ONLY regulate the Guernsey bank. If the parent goes bust and the subsidiary is still solvent, which is was until Darling got his thieving hands on the upstreamed Heritable moneys under the ridiculous pretence of anti-terrorism laws, then what exactly did the GFSC do wrong ? Upstreaming was an activity expressly approved at the time by the GFSC and by the FSA. The point I am making is that even when the Icelandic parent went bust, the Guernsey bank, and its GFSC-regulated activities, were still solvent. Even the upstreamed funds to Heritable were safe at the time that they were made. Heritable only became insolvent after Darling’s intervention, which was clearly to cover his own ar*e. The continued criticism of the GFSC by many is unfair and unjustified – it did not fail. Yes, a Guernsey bank went under, but NOT because of the failings of the GFSC.
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Arnald – should the farmer cease to produce food lest a criminal should eat?
Let’s all starve, then with a clear conscience.
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Arnald – you’re at it again. Therefore I rest my case.
You didn’t explain to me how a porn hedge fund works. Would you mind?
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Bob
Completely different.
Gilthead
Why the hell should I know? You’re the expert.
zzzz
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David
One of the weaknesses was the fact that Landsbanki was a stand alone bank which upstreamed to its rather fragile daddy bank.
The failure of the GFSC to appreciate the uselessness of the comfort letter until near to the end of Landsbanki was another regulatory slip up.
If the main banking system is shaky, it is an act of recklessness of assume a bank set up to upstream, and with a useless guarantee is hardly a safe haven for your loot.
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David
I did respond to your latest post but it seems to have got lost.
Briefly, the fact that Landsbanki Guernsey was a stand alone bank, upstreaming to a dodgy daddy bank structure was enough to warn many off.
In addition the useless letter of comfort and the time it took the GFSC to see there was no legally binding guarantee are simply further instances of regulatory myopia.
So whilst the Guernsey bank was okay its extended family was certainly in terminal decline.
It all shows the tick the box mentality led to failed regulation even without Pa Broon and Darling.
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Arnald – how convenient!
Should doctors be banned, lest they treat a tax dodger?
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Bob, doctors and farmers benefit society. How do you equate them with the social parasites?
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Bob
Think about it a bit will you?
Selling something to a criminal is not the same as implying that criminality is possible and no one will be any the wiser, especially if you buy this or that. And then explaining how the criminality works.
A farmer does not sell apples in the knowledge that those apples are only really designed to rob old grannies with.
So you see your profession as as important as food production and health?
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Steven, i’m getting lost here! Who is a social parasite?
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Arnald – a few days ago you posted a relatively sensible and considered post in which you conceded that the finance industry was not actively or knowingly involved in criminal behaviour but that, in your opinion, it was in denial.
Now you are back to your sweeping statements of your own version of “fact” by saying that the finance industry is knowingly assisting criminal behaviour. To coin your favourite phrase – prove it (see how I have generously asked you to prove a positive, unlike the negatives that you are so keen on asking others to prove).
Do I see finance as important and beneficial? Absolutely. I have worked on investments to develop fledgling renewable energy projects in the third world – they would not have got off the ground if the investment return was not there. Almost all of the projects on which I work build companies that employ real people (are they part of the “real economy” that you consider to be separate from finance?). I certainly see it as more beneficial to society than producing most of the disposable plastic tat that fills our shops, or working on a newspaper profiling the vacuous “celebrities”. Or are people only worthy in your eyes if they save lives with their bare hands?
That is a very high horse that you are sitting on. I hope you don’t fall.
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But Arnald, you tar the entire financial sector with the same brush, and accuse us of facilitating crime (in this instance tax evasion). You suggest our entire industry is based upon that facilitation of crime.
You are of course incorrect. Our industry exists to facilitate investment via efficient capital flows. We make a bit on the margins, but far less than the alternative inefficiency of government would cost. In our society, little investment occurs without substantial capital. Leave it all to government and all you’ll get is civil servants and no farmers to feed us.
The farmer or doctor know (or should reasonably suspect) at the outset that they will at sme point feed or care for criminals. The lawyer knows he will defend them. Yet the vast majority of their efforts are not directed in any way toward facilitating crime. Nor are ours in finance.
My neighbour puts out his hedgeveg daily, in the knowledge that some of his product or the proceeds will be stolen and used by criminals.
In finance, we are targeted by fiscal cheats and evaders, despite our efforts to drive them out. But those people would cheat and evade whether we were here or not. Evasion was common before we became a “finance centre”.
You say that our “product” is inherently flawed in that it attracts these people. My response is that so is just about every other product or service.
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Bob
Are you denying that accountants and lawyers get paid hansomly to devise ways to get around other jurisdictions’ tax and company laws?
Do you then deny that the products that use the devious structures are not actively promoted?
Why is it OK for us to meddle in somewhere else’s stability and them moan like children when they try and do something about it?
Jealous! It beggars belief.
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We aren’t meddling in their stability. it’s their law, their loopholes – we can’t change it!
The UK can dictate to us, and the UK can be dictated to by EC and USA. You make it sound like it’s the other way round.
I am not moaning about governments changing their own laws. It’s a matter for them. If (say) UK choose to change their tax laws, there’s doubless a couple of quid in it for me along the way.
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Arnald – please stick to your own point. One minute you are accusing people of promoting crime. The next you are saying that they advise people how to do things within the law. The two are not the same.
And get it right – it is English lawyers who advise on English tax rules, not Guernsey lawyers.
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