Where do they find these people?
I'm not going to bother fisking this quite so thoroughly, mainly because there's marginally less arrant stupidity in this article. However...
There is no regulation, registration or public accountability of trusts in the UK and it is impossible to know their beneficiaries
Apart, presumably, from the Law of Property Act 1925, the Financial Services and Markets Act 2000, the Judicial Trustees Act, the Public Trustee Act, the Trustees Appointment Act, the Trustee Act, the Administration of Estates Act, the Trustee Investments Act, the Companies Act, and so bloody on. I've studied Trusts Law and all I can say is that I bloody well wish that there was no regulation of trusts in the UK.
It was alleged that General Augusto Pinochet, the former Chilean dictator, used British banks to launder money. There is silence from the British authorities. Of the billions stolen by General Sani Abacha, the former Nigerian dictator, at least $1.3bn turned up in 42 accounts at 23 UK banks
Most of this is unsubstantiated allegation; some of it is undoubetdly true. It is difficult to prevent people from opening personal bank accounts, and very hard to prove that the money they deposit was illegally obtained. It is, however, rather beside the point when the Financial Services and Markets Act has, however clumsily, made this sort of money-laundering almost impossible in the UK.
Anyone deterred by the light UK regulation is welcomed to 70 or so tax havens that promise ultimate secrecy to the highest bidder. Over 30 of these "fiddle factories" are British crown dependencies and overseas territories and have close links with the City of London. Britain is legally and morally responsible for their good governance but does little to check their trade.
These 'fiddle factories' include Jersey, Gibraltar and Guernsey apparently. These are Crown Dependencies and consequently not a part of the United Kingdom. Britain has no legal responsibility for their governance, good or otherwise. Whether it has a moral responsibility is therefore irrelevant.
And what do those evil little fiddlers do? Why they emcourage company formation by making it possible that
Companies can be formed online by agents with minimum fuss and are up and running within a few days
I've got news for the little fathead. This describes almost exactly the process of company formation in the UK. I say almost because the actual time needed is more like hours. There's some filing to take care of, but a company can go from shelf to reality in as long as it takes to get a meeting room booked.
And when these companies are formed what do they do?
Major corporations have led the way in developing elaborate "transfer pricing" schemes, which enable companies to allocate costs and profits to various parts of their multinational operations, to dodge taxes. Company auditors keep quiet. Western tax authorities rarely challenge this practice for importing dirty money. Developing countries are routinely fleeced of much-needed capital for local development.
This chap's supposed to be an accountant. Companies allocate profits and losses because that way they are taxed on their total real profits. It's sound business sense. Its legality has just been upheld in the notoriously business-friendly ECJ where Marks & Spencer won the right to allocate between British and European elements of their business. And how have we suddenly switched from 'fiddle factories' encouraging money-laundering to 'major corporations' allocating profits?
Without addressing the secrecy facilitated by corporate structures, trusts, tax havens and business advisers, no government will ever succeed in controlling the flow of funds to terrorists
So his answer is for Britain to regulate Jersey and Guernsey to eradicate this? One small problem (apart from the intrinsic anti-business ethos of a man who thinks it's a bad thing that it's easy to set up a company) - it isn't legal. The Channel Islands are effectively sovereign states. Their financial laws are their business. Nothing to do with the British Government.
How is it possible for someone writing a high profile comment on, inter alia, Trust law, Financial law, Constitutional law and Banking law know so little about any of them?
Prem Sikka is professor of accounting at the University of Essex
Oh, silly of me. I'm looking forward to reading their coverage of the cricket tour of India, though presumably it will be written by their bridge correspondent.