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Mossack Fonseca fine “too little too late”

TI-UK responds to media reports on Mossack Fonseca fine

15th November 2016, London – The decision by the British Virgin Islands (BVI) regulator to fine Mossack Fonseca $440,000 is too little and too late, according to Transparency International UK.

Of the companies that appear in Mossack Fonseca’s files, one out of every two — more than 113,000 — were incorporated in the British Virgin Islands.

Robert Barrington, Executive Director Transparency International UK said:

“It is at least welcome that the BVI has finally recognised inadequacies in the anti-money laundering controls at Mossack Fonseca, but given that it took a leak for its regulator to work out what was happening in its own backyard, the BVI’s own abilities as a regulator are inevitably called into question.”

“Had the BVI established a public register of beneficial ownership as the international community has requested, it is possible that the problem could have been detected far sooner, if not prevented in the first place. The BVI must now support calls for Britain’s Overseas Territories to adopt such registers if it is to be allowed to continue to operate as a prominent cog in the global financial system.”

“Any financial penalty against Mossack Fonseca should be proportionate to the harm caused by the illicit financial flows revealed by the Panama Papers.  When you remember that illicit financial flows comprise at least 2% of global GDP and have a devastating impact in developing countries, entrenching poverty and fuelling insecurity, the scale of these fines imposed on Mossack Fonseca is embarrassingly inadequate.  It is a token gesture from a discredited and secretive regulatory regime that is neither a proportionate punishment for the damage caused nor a deterrent for future non-compliance.”

***ENDS***

Contact:
Dominic Kavakeb
Dominic.kavakeb@transparency.org.uk
020 3096 7695
079 6456 0340

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Read 159 times Last modified on Tuesday, 15 November 2016 19:02

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