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FCA sets Panama Papers review deadline for financial services firms

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The FCA has reportedly given financial services firms a deadline of 15 April to review any possible ties to the law firm at the heart of the Panama Papers data leak.

The FT reports the FCA wrote to around 20 firms earlier this week, giving them until mid-April to complete initial investigations into ties to Mossack Fonseca or companies managed by the firm.

It comes after a huge leak of data files revealed the extent of offshore tax dodging channeled through the company.

The FCA letter says: “Beyond 15 April we will require updates on any significant issues or relationships identified and a full response, detailing your findings, when your investigation is concluded.”

An FCA spokeswoman declined to comment.

However, in a statement issued earlier this week, the regulator said that it had contacted a number of firms about the issue.

“We are working closely with a number of other agencies who are also looking at this,” it added.

“As part of our responsibility to ensure the integrity of the UK financial markets we require all authorised firms to have systems and controls in place to mitigate the risk that they might be used to commit financial crime.”

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. It doesn’t seem to have occurred to anyone to ask how these 11 million papers were obtained.

    It would seem that the most likely answer is that the firm was hacked. If this is indeed the case why hasn’t there been any effort to apprehend the hackers – or is there on law for one type of hacker (Eg.Wikileaks) an another for these hackers?

    Answers on a postcard?

  2. It has very recently come to light that offshore companies now own more than £200bn of UK residential property.

    The Land Registry released, in April, a complete list of 40,000 offshore companies that own nearly 100,000 properties in England.

    Many of these are in the most affluent areas of the country. London in particular. And a number of the individuals behind these companies would appear to be Russian ‘oligarchs’ although I am sure that in BBC speak, “other nationalities and/or job descriptions are available” to buy.

    If you want to buy a car, house, open a bank account, get a mortgage, engage a lawyer or an accountant there are a number of hurdles us mere mortals need to overcome.

    Buying a house with a mortgage requires very significant levels of checks these days if you are a mere UK resident.

    Without a mortgage, it would seem, sees a very different picture, especially when ‘oligarchs’ and associated trades are involved in the vast movement of ill-gotten or plundered wealth.

    It does seem to be the case that Animal Farm ‘Orwellian’ rules apply with some people being more equal than others.

    The FCA clearly scratched the surface last year when it fined Barclays some £72,069,400 for failing to “minimise the risk” that it may be used to facilitate financial crime. For the record, the fine was the largest fine imposed by the FCA and its predecessor the FSA for financial crime failings.

    The FCA said “Barclays did not obtain information that it was required to obtain from the clients to comply with financial crime requirements. Barclays did not do so because it did not wish to inconvenience the clients”.

    So the big question here is, what checks are made when foreign oligarchs, despots, drug barons, dictators and other offshore potential ‘shady’ types buy billions of pounds worth of UK property?

    Why is it that in the UK, the first, possibly only checks are about if you are who you say you are with proof by way of an original document selection from a list such as a passport or drivers licence, council tax and utility bills rather than a requirement of proof by audit trail of where the money has actually come from, ignoring any sensitivities that could fall into the category of “not wishing to inconvenience the clients”.

    But wait, a simple money laundering web-based solution is now at hand to assist the ‘authorities’ in that process.

    A scan through the Panamanian law firm Mossack Fonseca’s recent , worlds largest ever, leaked data dump should suffice, showing how clients too important to question or upset let alone inconvenience, can launder money, dodge sanctions, evade tax and avoid inconvenience.

    Seems the FCA may have given this some thought

  3. Derek

    A useful comment which underlines a perennial truth – “It’s the rich wot gets the pleasure and the poor wot gets the pain’.

    This is a fact of life and those with the wherewithal will always find a way – they always have and always will. Indeed your example of oligarchs buying up London isn’t all bad news. For those of ordinary mortals living in the city who happen to own a house – we have seen values rise very nicely – thank you, as a result of their efforts. The trick is to avoid those parts of town that the Arabs and Russians find so attractive.

    Sill no mention of the hackers though.

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