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Carthy to travel to US for Panama Papers inquiry

15 March, 2017 - by Matt Carthy MEP

Sinn Fein MEP Matt Carthy is scheduled to visit Washington DC and the state of Delaware next week as part of a fact-finding mission to the US by the European Parliament’s Panama Papers inquiry (March 21-24).

The delegation of nine MEPs is due to meet with US government officials from Treasury and the IRS; Congressmen and Congresswomen and Senators from the House Ways and Means committee, the Senate Committee on Finance, and others. The group will also meet with Delaware state lawmakers and officials, and the Irish director of the ICIJ, Gerard Ryle.

Speaking in advance of the visit, Carthy said: “This is a crucial time to investigate the approach of the US authorities when it comes to combating tax evasion, tax avoidance and money-laundering, and how that impacts on the rest of the world.”

The European Parliament’s Panama Papers inquiry decided to make fact-finding missions to four countries as part of the inquiry - Luxembourg, Malta, Britain and the US. 

Carthy said: “I welcome the fact that the inquiry team will visit the US, a destination I argued we needed to look at. We need to examine the role of the US due to its economic weight, the amount of offshore wealth it holds and the number of shell companies registered in individual states – in particular, Delaware, South Dakota, Nevada and Wyoming. For example, there are more than 1 million ‘business entities’ registered in the state of Delaware alone.

“The US ranks third-worst globally in the Tax Justice Network’s Financial Secrecy Index, and it accounts for one-fifth of the global market for offshore financial services. This is likely to grow due to the fact that the US has not endorsed the Common Reporting Standard. This tendency is compounded by the fact that researchers testing checks on the set-up of shell companies found the US to perform worst globally.”

Carthy said he hoped to see the US to play a leadership role in combating tax evasion, tax avoidance and money-laundering.

“The Panama Papers show the urgent need to end the secrecy that surrounds beneficial owners, or true owners, of companies. The Financial Action Task Force has identified the US regime as being strong in many ways - but weak when it comes to others, including transparency on beneficial ownership, the implementation of customer due diligence requirements by banks, and the regulation of enablers such as lawyers and tax advisors.

“I also hope to examine how certain loopholes in US tax law interact with aspects of Irish tax law in a way that has resulted in Ireland becoming a state of choice for US corporations to use as a conduit in a global chain of tax avoidance, such as we’ve seen with Apple and others.

“I look forward to meeting with lawmakers, officials, academics and journalists in the US in order to develop a strong and coordinated global approach to dealing with the problems of tax avoidance, tax evasion and money-laundering.”

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