International Financial Law Prof Blog

Editor: William Byrnes
Texas A&M University
School of Law

Wednesday, August 19, 2015

FTC Warns Consumers That Personal Financial Data May Be At Risk Through Brokering

If the friend of a friend is my friend, and the enemy of a friend is my enemy, then is the seller of data FTC logoto a scammer also a scammer? In a case announced today, the FTC said it might well be.

Here’s the backstory: In 2013, we told you about a case we brought against Ideal Financial Solutions. That company, says the FTC, bought information that let it raid consumers’ bank and credit card accounts for millions — without the consumers’ OK or even knowledge. At the time, it was clear that many of these consumers had applied for online payday loans. But what wasn’t clear at the time was where Ideal Financial Solutions had gotten those bank account and credit card numbers.

Until now. Today, the FTC said that a data broker operation — Sequoia One, LLC, Gen X Marketing Group, LLC, and four principals — collected sensitive information from online payday loan applications, including Social Security numbers, credit card and bank account numbers. Then, says the FTC, they turned around and sold it to companies that included non-lenders like Ideal Financial Solutions, which the defendants knew were taking money from peoples’ bank accounts and credit cards. And, says the FTC, the defendants actually helped hide Ideal Financial’s scam.

Three of the defendants — Paul T. McDonnell, Theresa D. Bartholomew, and John E. Bartholomew, Jr. — agreed to settle the FTC charges. The proposed order imposes a monetary judgment, and says they can’t sell or benefit from selling consumer information from now on. The case against the rest of the defendants will be litigated.

So, what’s a person to do? Mainly this: think long and hard before you give out your Social Security number or bank or credit card information. Sometimes, you have to, if you want the service or offer. But stop and think: what do you know about the company, their website, or how they’ll protect your information? And if you think something has gone amiss with information you’ve already shared, tell the FTC.

FTC Press Release

August 19, 2015 in Financial Regulation | Permalink | Comments (0)

Tuesday, August 18, 2015

Where are the jobs for graduates? The big 4

According to the AICPA report Trends in the Supply of Accounting Graduates and the Demand for Public Accounting Recruits, hiring at public accounting firms jumped 7% to reach record levels in 2013–14. Ninety-one percent of all firms said they expect to hire accounting graduates at the same or higher levels in 2015. ...

- Read the full story at:

August 18, 2015 in Education | Permalink | Comments (0)

Update on Voluntary Disclosure Programmes: A Pathway to Tax Compliance

OECDThis second edition reflects the wealth of practical experience gained by 47 countries gained in relation to voluntary disclosure programmes. In addition, the guidance on the design and implementation of the programmes has been updated, particularly taking into account the views of private client advisers. 

 When the OECD published the first edition its report on Voluntary Disclosure Programmes in 2010, it was just 18 months after the G20 Leaders had declared the end of the era of banking secrecy and called upon countries to implement the standard on exchange of information on request. In that very short time, considerable progress in the global fight against offshore evasion had been made, with more than 500 tax information exchange agreements having been put in place that comply with the standard.

 The work of the Global Forum on Transparency and Exchange of information for Tax Purposes was reorganised to deliver a robust programme of peer reviews to ensure that agreed standards were being effectively implemented. At the same time, the OECD has always recognised the importance of offering taxpayers the opportunity to become compliant and has encouraged governments to enable people who want to regularise their tax affairs to declare the income and wealth they have concealed in the past. Voluntary disclosure programmes offer such taxpayers a way to do this and for governments a way to secure payment of missing revenue, using relatively limited administrative resources.

 Since 2010, a very substantial amount of further progress has been made in the area of international exchange of information and transparency in tax matters. The Global Forum now has more than 125 members and an impressive body of results from the ongoing programme of peer reviews.

Another major milestone in tax transparency was reached in 2014 with the adoption of the OECD Standard for Automatic Exchange of Financial Account Information in Tax Matters. Most financial centres have publicly committed to implementation and are working on a specific and ambitious timetable leading to the first automatic information exchanges in 2017 or 2018.

 With the implementation of the Standard being underway and providing the basis for a new level of transparency in tax matters, the time is right to update the guidance on voluntary disclosure programmes published in 2010.

 This updated report reflects the wealth of practical experience gained by 47 countries gained in relation to voluntary disclosure programmes. In addition, the guidance on the design and implementation of the programmes has been updated, particularly taking into account the views of private client advisers.

August 18, 2015 in OECD | Permalink | Comments (0)

Monday, August 17, 2015

Retirement: Pros and cons of fixed-index annuities

USA Today story 

“Fixed index annuities are the current flavor and will remain so while consumers perceive the market indexes potentially rising,” says William Byrnes, an associate dean at Texas A&M University School of Law in Fort Worth.

Sales of FIAs rose 14% to $38.7 billion in 2013 and another 24% to $48 billion in 2014, or about 21% of all annuity sales .... read about the upsides, the downsides, and the costs at USA Today

August 17, 2015 in Financial Services | Permalink | Comments (0)

The University of Iowa College of Law Hiring Faculty Positions

             THE UNIVERSITY OF IOWA COLLEGE OF LAW anticipates hiring several tenured/tenure track faculty members and clinical faculty members (including a director for field placement program) over the coming year. Our goal is to find outstanding scholars and teachers who can extend the law school’s traditional strengths and intellectual breadth. We are interested in all persons of high academic achievement and promise with outstanding credentials. Appointment and rank will be commensurate with qualifications and experience. Candidates should send resumes, references, and descriptions of areas of interest to:  Faculty Appointments Committee, College of Law, The University of Iowa, Iowa City, Iowa  52242-1113.

            THE UNIVERSITY OF IOWA is an equal opportunity/affirmative action employer. All qualified applicants are encouraged to apply and will receive consideration for employment free from discrimination on the basis of race, creed, color, national origin, age, sex, pregnancy, sexual orientation, gender identity, genetic information, religion, associational preference, status as a qualified individual with a disability, or status as a protected veteran.

August 17, 2015 in Academia | Permalink | Comments (0)

Saturday, August 15, 2015

Former Director, Julito Francis, of US Virgin Islands Public Finance Authority Charged With Bribery Over Construction Contracts

Three Virgin Islands men were charged in an indictment unsealed today with various offenses based on their participation in a bribery scheme involving over $17 million in construction contracts awarded by the Virgin Islands Public Finance Authority (VIPFA).  Francis et al Indictment

Julito Francis, 53, former Director of Finance and Administration for the VIPFA, is charged with 11 Justice logocounts of conspiracy, bribery, extortion under color of official right, honest services wire fraud and perjury.  Gerard Castor, 69, president and owner of Balbo Construction Corporation, is charged with 10 counts of conspiracy, bribery and honest services wire fraud.  John Woods, 59, co-principal of an architectural company that worked on behalf of the VIPFA, is charged with three counts of conspiracy, bribery and extortion under color of official right.

Francis, Castor and Woods were arrested earlier today and appeared before U.S. Magistrate Judge Ruth Miller of the District of the Virgin Islands.  The defendants were released pending an August 12 arraignment.

According to the indictment, Castor provided more than $400,000 in improvements to Francis’ personal residence, and over $10,000 in improvements to Woods’ personal property.  In    return, Francis and Woods used their official positions to ensure that Balbo Construction was awarded construction contracts by the VIPFA that were worth over $17 million, including a multi-million contract, and supplements thereto, to build the St. Thomas Regional Library.  The indictment further alleges that the defendants attempted to conceal the bribery scheme by creating false documents that suggested Francis and Woods intended to pay Castor for the work performed.

August 15, 2015 | Permalink | Comments (0)

Friday, August 14, 2015

New report compares performance, best practices and trends in 56 tax administrations

Tax administrations continue to face the challenges of improving their performance while reducing OECDcosts, decreasing compliance burdens for taxpayers tackling non-compliance. Improving taxpayer services, while making non-compliance harder, is helping revenue bodies increase their efficiency and allowing governments to finance important programmes that will further benefit their citizens.

Tax Administration 2015 is the sixth edition of the OECD’s comparative information series on tax administration. The report, which surveys 56 advanced and emerging economies (including all OECD, EU, and G20 countries), includes for the first time information: Costa Rica, Croatia, Morocco and Thailand. The series identifies fundamental elements of modern tax administration systems and uses data, analyses and examples to identify key performance trends, recent innovations, and examples of good practice.

Among the many findings and observations, the report in particular highlights:

  • Significant organisational change

  • Strong investment in digital services

  • Better connected e-services, and future opportunity

  • Improving outstanding tax debt position

  • Improving management of large taxpayers

  • Tax gap measurement on the increase

  • Greater use of disclosure policies to improve tax compliance and bolster tax revenues

  • Electronic matching of VAT invoices continues to expand

Among the many findings and observations, the report in particular highlights:

  • Significant organisational change - 40% of revenue bodies reported that they are currently managing the addition of new business activities, amalgamation with other government service providers, and consolidation of work and their office network, at a time when 60% saw reductions in staffing, with significant reductions in Australia, the United Kingdom and the United States.

  • Strong investment in digital services- driven by customer expectation and productivity demands revenue administrations have invested significantly in digitalon-the-go services. Average IT expenditure as a percentage of the total budget remained constant at 9.5%. Notable exceptions were Austria, Finland, Singapore and Norway where approximately 25% of the total budget is spent on IT.

  • Better connected e-services, and future opportunity- while 95% of all revenue bodies offer the opportunity to file returns electronically, and over two thirds achieve usage over 75%, more could be done to move other aspects of the end-to-end process, including assessment, amendment and payment into a more integrated digital service.

  • Improving outstanding tax debt position1 - Total tax debt for OECD member countries rose marginally in 2011 to 2013, from around 22% to just over 24% of net annual revenue collections. This ratio is however significantly impacted by two abnormal “outliers” which when removed change the results for OECD countries to show a decrease from 12.7% in 2011 to 11.1% of annual net revenue collections in 2013.  Notably seven revenue bodies: Estonia, Ireland, Japan, Korea, Norway, Sweden and Switzerland have a collection to debt ratio of less than 5%. Improvements in collection performance can generally be attributed to:
    • Strong management information systems;
    • Well-developed analytics tools to guide use of extensive enforcement powers;
    • Extensive use of tax withholding at source arrangements;
    • Wide use of electronic payment methods; and
    • Significant investment in information technology.

  • Improving management of large taxpayers - over 85% of revenue bodies have adopted the structured ‘co-operative compliance model’ recommended by the OECD, for managing their largest taxpayers. One-third use similar arrangements to manage the tax affairs of High Net Worth Individuals.

  • Tax gap2 measurement on the increase - 43% of revenue bodies report they undertake or are researching estimates of the aggregate tax gap for some or all of the major taxes administered.

  • Greater use of disclosure policies to improve tax compliance and bolster tax revenues3 - despite two-thirds of OECD member countries reporting that their tax law permits voluntary disclosures only 40% have a policy to encourage taxpayers to use these. Further only 11 member countries were able to report the results achieved from their voluntary disclosure programme. With the imminent implementation of automatic exchange of financial account information, it is expected that there will be greater interest in these programmes. See the recent report Update on Voluntary Disclosure Programmes: A Pathway to Tax Compliance.

  • Electronic matching of VAT invoices continues to expand – with growing concerns about the VAT non-compliance, a relatively large number of revenue bodies, including many in Europe and Latin America, are successfully  using systems to process bulk VAT invoice data for compliance risk management and fraud detection.


August 14, 2015 in OECD | Permalink | Comments (0)

Thursday, August 13, 2015

200 Defendants Investigated by SIGTARP Convicted of TARP-Related Crimes

Combined Efforts of SIGTARP with Law Enforcement Partners Results in Successful Convictions and Recovery of $1.58 Billion.

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) that Sigtarp_logo
200 bankers, corporate executives, mortgage modification scammers, real estate developers, brokers, and other defendants investigated by SIGTARP and our law enforcement partners have been convicted of crimes related to TARP.  Of the 200 defendants convicted, 113 have already been sentenced to prison, and others await sentencing.

"As a law enforcement team united against bailout-related crime, we are getting smarter with each case and more efficient at rooting out hidden TARP-related crime, stopping that crime, and bringing accountability and justice to perpetrators. There is much more to come."

August 13, 2015 | Permalink | Comments (0)

Wednesday, August 12, 2015

IRS Releases Advanced Pricing Agreements New Procedures in Rev Proc 15-40 and 15-41

This morning the US Treasury released the long awaited Advanced Pricing Agreement Procedures. IRS_logo

The 13 principal differences between these final revenue procedures and the proposed version of Notice 2013-79 are:

1. The final revenue procedure clarifies that if APMA requires, as a condition of continuing with the APA process, that the taxpayer expand the proposed scope of its APA request to cover interrelated matters (interrelated issues in the same years, covered issues or interrelated issues in other years, and covered issues or interrelated issues in the same or other years as applied to other countries), APMA will do so with due regard to considerations of principled, effective, and efficient tax administration and only after considering the views of the taxpayer and the applicable foreign competent authority. Further, APMA will communicate to the taxpayer any concerns about interrelated matters and possible scope expansion as early as possible.

2. In the interest of efficient tax administration, rollback years may be formally covered within an APA. A rollback will be included in an APA when a rollback is either requested by the taxpayer and approved after coordination and collaboration between APMA and other offices within the IRS or, in some cases, is required by APMA, after coordination and collaboration with other offices within the IRS, as a condition of beginning or continuing the APA process.

3 The final revenue procedure provides expanded guidance as to when an APA request will be considered complete.

4. The required contents of APA requests that were specified in the Appendix of the proposed revenue procedure have generally been retained.

5. Taxpayers are required to execute consent agreements to extend the period of limitations for assessment of tax for each year of the proposed APA term, and the required consent could be either general or restricted.

6. User fees are increased for APA requests but provides that total user fees may be reduced for multiple APA requests filed by the same controlled group within a sixty-day period. Also, user fee for requests for discretionary LOB relief are increased.

7. The final revenue procedure limits the scope of requests to which mandatory -pre-filing procedures apply to requests involving taxpayer-initiated positions.

8. To ensure that taxpayers have broad access to the U.S. competent authority to resolve disputes under U.S. tax treaties, taxpayers will not be required under the final revenue procedure to expand the scope of a competent authority request to include interrelated issues as a condition of receiving competent authority assistance. Taxpayers may still be required to provide information that will allow the U.S. competent authority to evaluate the appropriateness of the relief sought under the applicable U.S. tax treaty in light of the taxpayer's positions on interrelated issues.

9. The final revenue procedure clarifies that the U.S. competent authority may consult with taxpayers with respect to certain additional issues that may arise in connection with competent authority requests, such as issues relevant to the determination of foreign tax credits and repatriation payments.

10. The final revenue procedure provides additional guidance on requesting discretionary determinations under the limitation on benefits articles of U.S. tax treaties, including time frames for taxpayers to provide notification of material changes in fact or law and the introduction of a triennial statement procedure to maintain a favorable grant of discretionary benefits.

11. Consistent with the objective of providing taxpayers with broad access to the U.S. competent authority to resolve disputes under U.S. tax treaties, the U.S. competent authority will not condition assistance on the taxpayer's notification of the U.S. competent authority, or on obtaining its concurrence, with respect to signing a standard Form 870 with IRS Examination.

Similarly, a taxpayer will not be required to obtain the U.S. competent authority's agreement prior to entering into a closing agreement or similar agreement with IRS Examination, but in these cases the assistance provided by the U.S. competent authority will be limited to seeking correlative relief from the foreign competent authority, thus potentially not eliminating double taxation.

12. The final revenue procedure provides additional information about the process followed by the U.S. competent authority in conducting its review under the simultaneous appeals procedure.

13. The final revenue procedure clarifies and refines the bases on which the U.S. competent authority may decline to accept a competent authority request or may cease providing assistance, consistent with U.S. tax treaty policy that taxpayers should have broad access to the U.S. competent authority to resolve instances of taxation not in accordance with the applicable U.S. tax treaty.

Procedures for Advance Pricing Agreements  Download APA New Procedures Rev Proc 15-40

Procedures for Requesting Competent Authority Assistance under Tax Treaties  Download APA New MAP Procedures Rev Proc 15-41

William Byrnes is the primary author of Practical Guide to US Transfer Pricing

August 12, 2015 in Tax Compliance | Permalink | Comments (0)

IRS Procedures to Ensure Consistency and Effectiveness in the Administration of Civil FBAR Penalties

The purpose of the IRS interim guidance is to implement procedures to improve the administration of the Service’s FBAR compliance program.

When asserting an FBAR penalty, the burden is on the IRS to show that an FBAR violation occurred Irs_logoand, for willful violations, that the violation was in fact willful. The FBAR penalty provision of Title 31 establishes only maximum penalty amounts, leaving the IRS to determine the appropriate FBAR penalty amount based on the facts and circumstances of each case.

Read the May 13, 2015 IRS FBAR Guidance 

Prof Jack Townsend, on his federal tax crimes blog, discusses the recent Moore v United States (W.D. WA 2015) in which the Court "admonishes the IRS and imposes a cost for misleading the taxpayer" about a FBAR assessment.

August 12, 2015 in FinCEN | Permalink | Comments (0)

Tuesday, August 11, 2015

China Construction Bank Ordered to Beef Up its AML Program

China Construction Bank entered into an agreement with the Federal Reserve and New York State NY DFS
Department of Financial Services to self audit and enhance its anti money laundering program, including CDD and risk weighting of customers and their respective activities, suspicious activities monitoring and reporting, AML training, and integrity audits.

The Federal Reserve Bank Enforcement Order (Download) included:

Within 60 days of this Agreement, the Bank and the Branch shall jointly submit a written enhanced BSA/AML compliance program for the Branch acceptable to the Reserve Bank and the NYSDFS (the “Supervisors”). At a minimum, the program shall provide for:

(a) a system of internal controls designed to ensure compliance with the BSA/AML Requirements and State Regulations;

(b) internal controls designed to ensure compliance with all requirements relating to correspondent accounts for foreign financial institutions, including, but not limited to, affiliates;

(c) a comprehensive BSA/AML risk assessment that appropriately identifies and considers all products and services of the Branch, customer types and geographic risks, as appropriate, in determining inherent and residual risks;

(d) internal controls to ensure that the data received by the Branch’s BSA/AML monitoring system is complete and interpretable by the system; and

(e) effective training for all appropriate Branch personnel and appropriate personnel of affiliates that perform BSA/AML compliance-related functions for the Branch in all aspects of the BSA/AML Requirements, State Regulations, and internal policies and procedures.

August 11, 2015 | Permalink | Comments (0)

Monday, August 10, 2015

Ron Paul's Political Operative, Married to Granddaughter, Charged With Bribery of Iowa Presidential Caucus

Three members of former Texas Congressman Ron Paul's 2012 presidential campaign committee, including his grandson-in-law Jesse Benton, were charged with offenses relating to the concealment of payments made to a former Iowa State Senator Kent Sorenson influence the Iowa caucus, switching his vote from Michele Bachman to Ron Paul.  Another Ron Paul staffer acted as the whistleblower against Benton because of internal campaign rivalry.

“Federal campaign finance laws are intended to ensure the integrity and transparency of the federal Fec_corner_logoelection process,” said Assistant Attorney General Caldwell.  “When political operatives make under-the-table payments to buy an elected official’s political support, it undermines public confidence in our entire political system.”

“Violating campaign finance laws by concealing payments to an elected official undermines our electoral system and deceives the public,” said Special Agent in Charge LeValley.  “The FBI will aggressively investigate those who corrupt the integrity of our democratic process.”

Jesse R. Benton, John M. Tate, and Dimitrios N. Kesari, are charged by indictment with conspiracy, causing false records to obstruct a contemplated investigation, causing the submission of false campaign expenditure reports to the Federal Election Commission (FEC) and engaging in a scheme to make false statements to the FEC.  Benton is additionally charged with making false statements to the FBI, and Kesari is also charged with obstruction of justice. 

The defendants were members of the Ron Paul campaign in the 2012 presidential election.  According to allegations in the indictment, former Iowa State Senator Kent Sorenson initially supported Michele Bachman in the 2012 presidential election, but between October and December 2011, secretly negotiated with the defendants to switch his support to Ron Paul in exchange for money.  On Dec. 28, 2011, at a political event in Des Moines, Iowa, Sorenson publicly announced his switch of support.

The payments to Sorenson were allegedly made in monthly installments of approximately $8,000 each and ultimately amounted to over $70,000.  The indictment alleges that the defendants concealed the payments by causing them to be recorded – both in campaign accounting records and in FEC filings – as campaign-related audio-visual expenditures, and by causing them to be transmitted to a film production company and then to a second company that was controlled by Sorenson.  According to the indictment, the conspirators concealed their campaign’s payments to Sorenson from their candidate and also from the FEC, the FBI and the public.   

The indictment further alleges that, in response to criticism of Sorenson’s change of support from one candidate to the other, the conspirators arranged for Sorenson to issue public statements denying allegations that he was offered money for his endorsement and noting that the campaign committee’s FEC filings would show that it made no payments to Sorenson. 

On Aug. 27, 2014, Sorenson pleaded guilty to causing a campaign committee to falsely report its expenditures to the FEC and to obstruction of justice.  He has not yet been sentenced.

August 10, 2015 | Permalink | Comments (0)

Sunday, August 9, 2015

Financial Sector Executives as Targets for Money Laundering Liability

Financial Sector Executives as Targets for Money Laundering Liability  

JEFFREY R. BOLES, Temple University - Department of Legal Studies in Business

This article explores the merits of government initiatives that assign personal liability for money SSRNlaundering violations committed by institutions in the financial sector. In it I argue that the current set of personal liability initiatives proposed in Congress and endorsed by federal agencies contain problematic features that conflict with corporate governance principles, raise troubling ethical issues, and could bring harmful effects to the financial services sector with reverberations beyond the industry. I suggest an alternate approach for bringing personal liability to the industry that avoids these challenges.

August 9, 2015 | Permalink | Comments (0)

Saturday, August 8, 2015

Tax Exemption, Public Policy, and Discriminatory Fraternities

David Herzig, Valparaiso University Law School

Samuel D. Brunson, Loyola University Chicago School of Law

SSRNIn this Essay, Professors Herzig and Brunson make the normative argument that the I.R.S. should reject tax-exemptions of discriminatory social clubs. They look to current Supreme Court jurisprudence to demonstrate a willingness of the Court to import a public policy rule into the social club rules. Alternatively, if this position is untenable under traditional administrative law principles, they propose a statutory fix.

read it here:


August 8, 2015 in Education | Permalink | Comments (0)

How to dispute credit report information that can’t be confirmed

Would you know what to do if a debt collector reported a debt to a credit reporting agency and then went out of business, leaving no one to confirm or legally collect the debt?

That’s the problem facing consumers whose debts were owned by Crown Funding Company, a debt Ftc_logo_430collection company the FTC sued for deceptive practices. The FTC’s law enforcement actionpermanently closed Crown and more than two dozen other companies linked with Crown, but the debts that Crown reported remain on many consumers’ credit reports.

The solution for Crown's consumers is the same as for any consumer who finds information on their credit reports that’s inaccurate or can’t be confirmed: Federal law says that, when consumers dispute information on a credit report, the credit reporting agencies must investigate it. If the credit reporting agency can’t confirm the information with the company that reported the debt — and in the case of Crown, it can’t — it must delete the information from the consumer’s credit report, usually within 30 days of receiving the consumer’s dispute.

Disputing Errors on Credit Reports lists the steps you need to take, and includes a sample letter to help make your case.

To learn more about money management, credit reports, and debt collection, visit Money & Credit.

The other companies linked with Crown are: AFK Solutions, LLC; Alhambra Enterprises; American FP, LLC; American PG, LLC; Asset Portfolio Partners, LLC; Capital FC, LLC; Capital FP, LLC; Capital IG, LLC; First CG, LLC; First FF, LLC; First FG, LLC; First FS, LLC; First Franklin Holdings, Inc.; First Planners United, LLC; First Technology Services; Freeman United Holdings, LLC; Global AG, LLC; Global Holding Services, LLC; Global Pacific Financial Services; Grant Services Management, LLC; Han Dynasty, Inc.; Heinz Capital Financial, LLC; Heinz Capital Funding, LLC; International Capital Holdings; Ish Inc.; Las Vegas Funding & Financial; Leon Solutions Services, LLC; National FC, LLC; National IG, LLC; National Service Partners, LLC; New Capital Holdings, Inc.; Pacific Holding Partners, LLC; Portfolio MG, LLC; Premiere PG, LLC; Revere Recovery Group, LLC; United CC Holdings, LLC; United FP, LLC; United Holding Services, LLC; United Services Partnership, LLC.

August 8, 2015 in Financial Regulation | Permalink | Comments (0)

Friday, August 7, 2015

OECD Releases 3 New Reports to Combat Offshore Tax Evasion

The OECD today releases three new reports to help jurisdictions and financial institutions OECDimplement the global Standard for automatic exchange of financial account information.

  • Common Reporting Standard Implementation Handbook (the CRS Handbook): this first edition provides practical guidance to assist government officials and financial institutions in the implementation of the Standard. It sets out the necessary steps for implementation and will help financial institutions and governments implement the Standard more efficiently by promoting the consistent use of optional provisions, identifying areas for alignment with FATCA and addressing the operational and transitional challenges resulting from the staggered implementation of the Standard. It also contains answers to frequently asked questions (FAQs) received from business and governments, with a view to furthering the effective implementation of the Standard. The Handbook is intended to be a “living” document and will be updated on a regular basis.

  • Offshore Voluntary Disclosure Programmes: this second edition contains a wealth of practical experience from 47 countries in relation to their voluntary disclosure programmes. The guidance on the design and implementation of such programmes has been updated, particularly taking into account the views of private client advisers. The limited time left until the automatic exchange of information under the Standard becomes a reality will in many instances be the last window of opportunity for non-compliant taxpayers to voluntarily disclose. This is therefore a crucial moment to update the publication and reflects OECD policy of encouraging countries to examine voluntary compliance strategies that enable non-compliant taxpayers to come forward.

The Standard calls on jurisdictions to obtain information from their financial institutions and automatically exchange that information with other jurisdictions on an annual basis. Over 90 jurisdictions have committed to implement the Standard, with the first exchanges starting in 2017/2018, subject to the completion of necessary legislative procedures.

For more information on the Standard, please visit

August 7, 2015 in GATCA, OECD | Permalink | Comments (0)

UK Prime Minister Announces Publicly Available Land Registry for Offshore Company Ownership

United Kingdom Prime Minister, his RT Hon. David Cameron, delivered an announcement on requiring publicly available transparency of the land registry for property owned by offshore companies during his speech in Singapore to the Lee Kuan Yew School of Public Policy.   The relevant aspects are excerpted below -

As the economist Professor Paul Collier has noted, lack of transparency over who owns companies “not only assists tax avoidance, it is the key vehicle for corruption.”

Why? Because when you have companies whose ownership isn’t known you allow a shroud of HM_Treasury_logo.svg Hmrc_logo_altsecrecy behind which people can do bad things, sometimes terrible things, with no accountability. The corrupt, the criminals, the money-launderers – they need anonymous company structures to hide, to move and to access their money. So by lifting off this shroud of secrecy we can expose wrongdoing and dissuade others from going down the same path.

Now this is a challenge for everyone – including ASEAN, including Britain. We too must get our house in order – and we are. And that is why the UK government has legislated to ensure that from next year, Britain will become the first major country to establish a publicly accessible central registry showing who really owns and controls all British companies.

... So I’ll continue to make the case for transparency with international partners – including the British Overseas Territories and Crown Dependencies. And I am willing to go further, and take concrete steps to force the pace. And that includes looking at whether we can get foreign companies investing in the UK to step up to the same level of transparency.

Now with £122 billion of property in England and Wales owned by offshore companies we know that some high-value properties – particularly in London – are being bought by people overseas through anonymous shell companies, some of them with plundered or laundered cash. Just last week, there were allegations of links between a former Kazakh secret police chief and a London property portfolio worth nearly £150 million.

I’m determined that the UK must not become a safe haven for corrupt money from around the world. We need to stop corrupt officials or organised criminals using anonymous shell companies to invest their ill-gotten gains in London property, without being tracked down.

People like convicted Nigerian fraudster James Ibori, who owned property in St John’s Wood, Hampstead, Regent’s Park, Dorset all paid for with money stolen from some of the world’s poorest people. So we have got to find ways to make property ownership by foreign companies much more transparent.

There may be a number of ways we can do this, for example extending what we currently ask of UK companies to foreign companies too. And we will consult on the best way forward.

But as a first step, I have asked the Land Registry to publish this autumn data on which foreign companies own which land and property titles in England and Wales. This will apply to around 100,000 titles held on the Land Register and will show for the first time the full set of titles owned by foreign companies.

And we will also look carefully at the case for insisting that any non-UK company wishing to bid on a contract with the UK government should also publically state who really owns it using the government’s buying power as a if you like, battering ram for greater corporate transparency around the world.


August 7, 2015 in GATCA | Permalink | Comments (0)

Financial Regulators Provide Feedback to Nonbank Firms on Resolution Plans

The Federal Reserve Board and the Federal Deposit Insurance Corporation (FDIC) on  800px-FdicLogoTuesday provided guidance to 119 firms that in December will be filing updated resolution plans. Based on a review of their plans submitted late last year, the agencies are tailoring the requirements for the submissions. Some firms will receive individual feedback on areas for improvement.

The Dodd-Frank Wall Street Reform and Consumer Protection Act requires that bank holding companies with total consolidated assets of $50 billion or more and nonbank financial companies designated by the Financial Stability Oversight Council as systemically important periodically submit resolution plans to the FDIC and the Federal Reserve. Each plan must describe the company's strategy for rapid and orderly resolution under the U.S. Bankruptcy Code or other applicable insolvency regime in the event of material financial distress or failure of the company.

One hundred and fifteen U.S. bank holding companies with less than $100 billion in total nonbank assets and foreign-based firms with less than $100 billion in U.S. nonbank assets were required to file their second resolution plans with the agencies in December 2014, and four foreign-based firms were required to file their initial resolution plan. Following review of the resolution plans, the agencies are providing each firm with guidance, clarification, and direction for their upcoming resolution plans based on the relative size and scope of each firm's U.S. operations. Plan requirements are tiered with less complex firms filing more streamlined plans:

  • Twenty-nine of the more complex firms are required to file either full or tailored resolution plans that take into account guidance identified by the agencies.
  • Ninety firms with limited U.S. operations may file plans that focus on material changes to their 2014 resolution plans, actions taken to strengthen the effectiveness of those plans, and, where applicable, actions to ensure any subsidiary insured depository institution is adequately protected from the risk arising from the activities of nonbank affiliates of the firm.

The new plans are due to the agencies on or before December 31, 2015.

The agencies released an updated tailored resolution plan template. A tailored resolution plan focuses on the nonbanking operations of the firm and on the interconnections and interdependencies between the nonbanking and banking operations.  The optional template is intended to facilitate the preparation of tailored resolution plans.

The Federal Reserve Board and the Federal Deposit Insurance Corporation (FDIC) on Tuesday 

provided feedback to three nonbank financial companies regarding their initial resolution plans and guidance to the firms for their upcoming filings.

The Dodd-Frank Wall Street Reform and Consumer Protection Act requires that bank holding companies with total consolidated assets of $50 billion or more and nonbank financial companies designated by the Financial Stability Oversight Council as systemically important periodically submit resolution plans to the FDIC and the Federal Reserve. Each plan must describe the company's strategy for rapid and orderly resolution under the U.S. Bankruptcy Code or other applicable insolvency regime in the event of material financial distress or failure of the company.

Three nonbank financial firms that filed initial resolution plans in July 2014 are:

  • American International Group, Inc.,
  • Prudential Financial, Inc., and
  • General Electric Capital Corporation (GECC).

The agencies tailored their feedback to account for each company's unique business, structure, and operations. In addition to the specific guidance given to each company, the letters include some common areas that the firms should address. Those areas include the need for more detailed information on, and analysis of, obstacles to resolvability, including global cooperation, interconnectedness, and adequate funding and liquidity. Further, the agencies instructed the firms to describe in their resolution plans the progress they are making, and the steps remaining, to be more resolvable. Finally, the agencies directed the firms to strengthen the public portions of the firms' upcoming resolution plans. The feedback to GECC acknowledges the firm's divestiture plan.

The three nonbank financial companies will submit the second version of their annual resolution plans on or before December 31, 2015. The agencies will require that the firms demonstrate that they are making significant progress to address the obstacles to resolution noted in the feedback to each company, and are taking actions to improve their resolvability.

August 7, 2015 in Financial Regulation | Permalink | Comments (0)

Thursday, August 6, 2015

Global Forum releases new compliance ratings on tax transparency

The Global Forum on Transparency and Exchange of Information for Tax Purposes published new peer review reports today for 12 countries or jurisdictions, moving further OECDahead with its goal to implement global standards on transparency and exchange of information for tax purposes.

Phase 1 reports on AlbaniaBurkina FasoCameroonDominican Republic,LesothoPakistan and Uganda assessed their legal and regulatory frameworks for transparency and exchange of information on request. These countries were assessed to have legal frameworks in place to enable them to move to the next stage of the review process, which will assess exchange of information practices.

The Global Forum also reviewed exchange of information practices through Phase 2 peer review reports in Lithuania and Sint Maarten. Both were given a rating for compliance with the individual elements of the international standard and an overall rating with Lithuania receiving an overall rating of “Compliant” and Sint Maarten an overall rating of “Partially Compliant.”

Jurisdictions continue to request supplementary reviews that assess steps taken to address recommendations of the Global Forum to address gaps in their legal frameworks and exchange of information practices identified in previous reviews. This included the Marshall Islands, which had been blocked from moving to Phase 2 of its review process due to significant gaps in its legal framework. A supplementary review concluded that key changes to its legislation now enable the Marshall Islands to move to Phase 2.

Austria, which was rated “Partially Compliant” in July 2013, has since implemented a number of recommendations by the Global Forum, leading to an upgrade of its overall rating to “Largely Compliant” in its supplementary report. The supplementary report of the British Virgin Islands, which assesses progress made since its Phase 2 report in July 2013 also concluded that based on significant improvements having been made, its overall rating be upgraded from “Non-Compliant” to “Largely Compliant.”

The Global Forum is the world’s largest international tax group, with 127 members on an equal footing. The Forum has now completed 198 peer reviews and assignedcompliance ratings to 80 jurisdictions that have undergone Phase 2 reviews. Of these, 21 jurisdictions are rated “Compliant”, 46 are rated “Largely Compliant”, 10 are rated “Partially Compliant” and 3 jurisdictions are “Non-Compliant.” A further 11 jurisdictions are blocked from moving to a Phase 2 review due to insufficiencies in their legal and regulatory framework.

The Global Forum continues to ensure that the benefits of participation in the new tax transparent and cooperative environment are available to all. It has conducted a number of training seminars to help jurisdictions prepare for peer reviews, sensitize tax auditors in the use of the exchange of information infrastructure and equip governments to implement automatic exchange of information. Around 200 tax experts participated in seminars in Colombia, Cameroon, Ghana and Kenya. The Global Forum will also support a new pilot project on Automatic Exchange of Information announced jointly by Ghana and the UK on the sidelines of the 3rd Financing for Development Conference in Addis Ababa.

Global Forum members will meet at their annual plenary meeting on 29-30 October 2015 in Bridgetown, Barbados.

August 6, 2015 in GATCA | Permalink | Comments (0)

Prof Paul Caron, Founder of Law Prof Blogs Network and Tax Prof Blog Named Associate Dean For Research And Faculty Development At Pepperdine

Press Release: Paul L. Caron Named Associate Dean for Research and Faculty Development

"He is the publisher and editor of Tax Prof Blog, the most popular tax blog on the Internet; and the owner and publisher of the Law Professor Blogs Network of more than 50 blogs in other areas of law edited by law professors around the country."

"Caron has been named one of the 100 most influential people in tax and accounting for nine years running by Accounting Today. He was named the sixth most influential person in legal education in 2014 by The National Jurist."

August 6, 2015 in Academia | Permalink | Comments (0)