After a massive new leak of financial documents, known as the Pandora Papers, EU lawmakers called for more action against money laundering and tax evasion, and urged EU finance ministers to review the blacklist of global criminals.
Pandora Papers is the latest in a series of document leaks over the past few years. Published by a group of investigative journalists, it shows how political and economic elites from around the world circumvent anti-money laundering regulations and evade taxes through a network of mailbox companies.
Among the European figures implicated in the leak of the document are Tony Blair, the former British Prime Minister, the Czech Prime Minister Andrej Babis, and the Dutch Finance Minister Wupke Hoekstra.
In response to the Bandura Papers, EU lawmakers have called for more effective EU action in combating money laundering and tax evasion.
Although some EU member states have suffered similar data leaks in the past, most of the countries featured in Pandora’s Papers are tax havens outside the EU.
In order to target such tax havens, the European Union drew up a blacklist of “non-cooperative tax areas” in 2017, which has been reviewed regularly since then. However, many of the tax havens mentioned in the Pandora Papers are not on the EU blacklist.
According to Johan Langeruk, political advisor to the European Green Party, this shortcoming can be explained by poor standards and political considerations.
“To combat tax evasion and money laundering, it is important to know the beneficial owner of a company or legal entity. However, this standard is still not blacklisted by the European Union, which makes this tool less effective.
EU finance ministers must decide on the blacklist
EU finance ministers are expected to blacklist more countries when they meet on October 5th. After reviewing the latest blacklist, ministers are expected to agree to delist three countries.
Marcus Ferber of the EPP group in the European Parliament criticized the move:
“EU finance ministers’ plan to reduce the EU blacklist this week is sending a completely wrong signal. If you want to fight tax havens effectively, the EU blacklist must be linked to tough sanctions.”
Socialist MP Paul Tang agreed, urging European finance ministers to do more.
The EU list of tax havens and the method used to compile it is totally inadequate. Strong reforms are needed starting tomorrow when EU finance ministers discuss the list,” the Dutch MP wrote on Twitter.
In addition, Dutch Finance Minister Wopke Hoekstra should exclude himself from this decision, as his name also appears in the Pandora papers.
Sven Giegold, a Green House member of the European Parliament and a longtime advocate on tax issues, said the new data leak should serve as a wakeup call. He stressed the need to know the real owners of postal companies and real estate.
His position on the meeting of finance ministers was even sharper.
“EU finance ministers should postpone tomorrow’s decision on the EU list of tax havens to avoid embarrassment and to ensure that the list is fit for purpose and includes all global tax havens.”
So far, the council, where the 27 EU ministers meet, has shown no sign of any change in plans.
However, the European Parliament changed its agenda for this week’s plenary session to include a discussion on the Pandora Papers on Wednesday afternoon (October 6).
New anti-money laundering rules have been proposed recently
The Pandora Papers were published just two months after the European Commission proposed a legislative package to strengthen the European Anti-Money Laundering Framework in Europe.
The European Union has long been reluctant to enforce its own anti-money laundering rules as some member states have been reluctant to do so. To circumvent this problem, the Commission in July proposed a new anti-money laundering regulation and a European anti-money laundering agency.
The new framework would give the EU more powers to deal with money laundering in EU countries despite resistance from member states. The proposals were not discussed by Parliament and the Council.
[Bearbeitet von Zoran Radosavljevic]
“Alcohol buff. Troublemaker. Introvert. Student. Social media lover. Web ninja. Bacon fan. Reader.”