FSA chairman Howard Davies has warned offshore centres they face a bleak future if they do not do mo...
FSA chairman Howard Davies has warned offshore centres they face a bleak future if they do not do more to demonstrate they can and do meet international standards of best regulatory practice.
Speaking to an audience of financial services officials in the Isle of Man last night, Davies says:
"The political temperature of the offshore centre question has risen sharply in recent months. Political leaders in the G7 economies, in particular, are very concerned by what they see as dangerous gaps in the world's defences against financial crime and financial instability. The tragic events in New York two weeks ago, and the issue of who financed the terror which created them - and where - have accentuated that concern," says Howard.
"The US decision on Monday to freeze the assets and transactions of international banks which fail to co-operate with the campaign against terrorism raises the stakes further. It will cause banks to look even harder at whether their branches around the world, and especially in offshore centres, are fully compliant with money laundering best practice.
"Those responsible for the governance and regulation of offshore centres would do well to be aware of the challenges they face. In short, offshore centres will need to do much more in the coming years to demonstrate that they can and do meet international standards of best practice. If that does not happen, then the future is bleak."
International financial centres such as the Isle of Man and the Channel Islands are already under immense pressure from the inter-governmental Organisation of Economic Cooperation and Development (OECD)to reform its regimes and tax practices, and many changes have also been put in place to meet Financial Action Task Force anti-money laundering requirements.
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