BLOGS REVISITED

I am going to revisit two of my blogs of this week to make some additional comments.

To start let me restate my position on the right to demonstrate. In a democracy I believe we have the basic right to peacefully express our views by marching or holding protests.

Furthermore I believe it is one of the tasks of the British police force to ensure we are able to practice that right without hindrance.

I do not believe that being in a democracy gives us the right to riot, cause damage or abuse the police verbally or physically. I do believe the police have the right to protect themselves, property and members of the public.

During the G20 protests in London there were thousands of police on duty. The vast majority performed their tasks within the law and in a praiseworthy manner. Sadly there are those who did not and we are now seeing the fall-out from those tragedies.

If there are officers who were guilty of assault, if there are officers who have a culture of violence, if there are sections of the force that are trained and instructed to act inappropriately, and there are senior officers who attempted to cover us such acts – then they must be rooted out and dealt with.

However the events surrounding the G20 in London and just days later the violence that erupted in Strasbourg at the NATO Summit are starkly different. In France for example, they have a trained riot police, whose methods would simply not be accepted in Britain but whose actions were applauded by their political masters in that country.

It is right that in Britain we demand the highest standards of our police. It is right also that when a section of the force or individual officers break the law they were set up to defend – they should be punished, and heavily. However let us be careful not to blacken the name of an entire police force and that of thousands of good officers – because that would not be democratic either.

I close with Gibraltar and its off-shore status. On the day I wrote my blog on the OECD Britain’s Prime Minister, Gordon Brown, sent a missive to the UK’s tax havens including Gibraltar informing them that they had to meet international transparency standards by signing 12 bilateral tax agreement by November or face sanctions.

The facts are these: Gibraltar signed an accord to meet the OECD’s standards in 2002 then sat on its hands for seven years and did nothing. Ahead of the G20 meeting it hurriedly signed a tax agreement with the USA but has seen itself demoted down the OECD’s list of “Good Guys”. Under the threat of sanctions the British Government has now given the Rock till November to get its house in order.

Gibraltar’s Chief Minister, Peter Caruana, says he is confident that they would meet that timetable. A miracle – 13 agreements in seven months after seven years of doing nothing.

So it still begs the questions why did Gibraltar sign the agreement in 2002 then do nothing when it could have acted and been the pace-setter amongst off-shore tax havens?

Why has it given the strong critics of tax havens a sitting target – because even if it now complies it will be the threat of sanctions that is held up as the reason – when it could have been the model off-shore centre all others were made to follow?

MADOFF ON THE ROCKS

Gibraltar is receiving unwelcome publicity over the involvement of some of its banks in the Madoff Ponzi scheme. The spotlight has first fallen on the Banque Jacob Safra just at the time the international Organisation for Economic Co-operation and Development (OECD) says Gibraltar has not complied with all its off-shore agreements.

First the trustee liquidating Bernard Madoff’s brokerage is seeking the return of $150 million that an offshore investor withdrew less than two months before the jailed swindler’s arrest, saying the money should be returned to other customers.

A lawsuit was filed last Thursday as trustee Irving Picard steps up his efforts to use bankruptcy law to try to “claw back” funds withdrawn by some Madoff clients. He has already appointed a Gibraltar law firm to act on his behalf.

In the lawsuit Picard argues that whilst Madoff was running his long-standing Ponzi scheme, some customers received fund distributions that were nothing more than fictitious profits. This money, says the trustee, should be returned to help reimburse Madoff’s many victims.

The complaint was filed in the U.S. Bankruptcy Court in Manhattan against Vizcaya Partners, described as an international business with main operations in the British Virgin Islands. It seeks the return of $150 million wired from the Madoff firm to a custodian for Vizcaya on about October 31, less than two months before Madoff’s arrest. The custodian, Banque Jacob Safra of Gibraltar, was also sued.

The lawsuit says Vizcaya, according to the Madoff firm’s records, opened an account with the company in December 2001. Since January 2002, Safra or its affiliates invested about $327 million with Madoff for Vizcaya's benefit, the lawsuit said.

Meanwhile in the official OECD list, Gibraltar is one of 30 tax havens, which are ‘jurisdictions that have committed to the internationally agreed tax standard, but have not yet substantially implemented it.’ Gibraltar committed in 2002 to implement the agreed tax standard. Up to now it only has one agreement, the recent one with the USA signed just before the G20 summit in London.

Now a cynic (so that rules me out) might say that as Barack Obama has tax havens firmly in his sights Gibraltar’s actions were a ploy to take the president’s eye off their target. What is a fact is that after seven years of doing nothing the Chief Minister, Peter Caruana, rushed to London to sign the accord amidst much fanfare – so draw your own conclusions.

In the Gibraltar section of the OECD list are locations such as Andorra, British Virgin Islands, Cayman Islands, Dominica, Liberia, Liechtenstein, Monaco, Nauru, Panama, San Marino and the Turks and Caicos Islands, and others. Whilst the other British zones of Guernsey, Jersey and the Isle of Man plus the island of Malta have all been promoted above them in the OECD’s standing.

People on the Rock might question why the Gibraltar Government signed in 2002 an accord that it seemingly had little intention of implementing when it could have acted on it immediately and lead the pack of good guys in off-shore finance.

Furthermore the Gibraltar Government has argued that it is no longer a tax haven but the OECD says it is, and that organisation’s opinion that counts amongst world leaders when they view the off-shore banking scene.