Tackling global financial fraud through committed international cooperation

10 December 2013
News Article
Press Release/News

Over 120 delegates and speakers from 35 countries have participated in an expert conference at Europol aimed at tackling serious and organised tax crime. Co-hosting the event with Italy’s Guardia Di Finanza and Belgium’s Special Tax Inspectorate (ISI), Europol welcomed experts, tax administrators, investigators and tax fraud prosecutors to discuss the criminal abuse of offshore tax evasion vehicles.

With the political spotlight recently focussing on those who consciously cheat governmental revenues as never before, the so-called tax havens are not only being exploited by the wealthy or large corporations, but also by organised crime gangs. These criminal organisations use tax havens for laundering the proceeds of their ill-gotten gains and to facilitate the running and development of their criminal enterprises, away from the scope of EU legislation, administrative or law enforcement scrutiny.

The estimated losses attributable to the use of tax havens are myriad; even highly respected humanitarian organisations like Oxfam International have spoken out. In its press release of 22 May 2013, Oxfam estimates that USD 18.47 trillion is being held by individuals in tax havens around the globe, of which over two thirds - USD 12.29 trillion – is sitting untaxed in European-linked tax havens. Oxfam calculates that the lost revenue from these deposits would provide enough cash to end extreme poverty - twice over.

Conference participants agreed that the tools to successfully fight such fraudsters already exist but more work is required to ensure that these tools are made available to the right people at the right time. Although the criminal abuse of offshore tax evasion vehicles is currently at the top of the political agenda, and much has been done in the way of formalising agreements between countries to share financial data, as MEP Bart Staes’ representative said: “Reports of the demise of offshore tax havens have been greatly exaggerated”.

Rob Wainwright, Director of Europol, reiterated Europol’s firm commitment to continue supporting Member States’ duly empowered law enforcement agencies to identify, disrupt and where possible dismantle the criminal networks that run large-scale tax fraud or evasion schemes. “Europol will do this in the framework of the EU Multidisciplinary Action Plan against Criminal Threats (EMPACT) in cooperation with our partners that have the administrative powers. For this, we need a permanent dialogue and this conference provided the perfect platform for engagement,” said Director Wainwright.

Conference delegates present on 27-28 November came from all over the EU, countries such as Georgia, Israel, United States and Ukraine, as well as organisations such as the European Commission, Eurojust, the Organisation for Economic Co-operation and Development (OECD) and the International Consortium of Investigative Journalists (ICIJ). Participants included Kunio Mikuriya, Secretary General of World Customs Organisation; Hans Van Scharen, representing Bart Staes, Member of the European Parliament, vice chair of the Budgetary Control Committee and member of the Special Committee for Organised Crime; and John Crombez, Belgian Secretary of State for Fiscal Fraud, who stated how “The industry of fraud is dynamic.” Grace Navarro, from the OECD, added: “Criminals do not operate in silos, therefore why should tax administrations and law enforcement”?

All speakers agreed that the only way to effectively combat the threat of organised criminals exploiting global financial structures is by continuing timely international and inter-agency cooperation.