Offshore Financial Centers

FBI Law Enforcement Bulletin,The, Feb, 2001 by Mark D. Ferbrache

A report of the findings of the review serves as a resource and guide to all U.S. law enforcement agencies who have, or will have, investigative contact with the Islands. It provides a detailed, but succinct, review of these offshore financial centers from a U.S. law enforcement perspective. The report discusses the political and economic climate, as well as the law enforcement and criminal environment, and cites the specific legislation local authorities operate under in conducting fraud investigations and providing assistance. Because each of the Islands stands as a uniquely individual international offshore financial center, the report includes copies of published guides from each island jurisdiction, which provide instructions on how to draft requests for evidence and assistance. Law enforcement agencies can access the report [15] on the FBI's Law Enforcement Online. [16]

CONCLUSION

With the technological advances in communications, law enforcement agencies have begun to face the effects of the global criminal. Fraud and money laundering have become commonplace for the international thief due to these modern developments.

Offshore financial centers, such as the Channel Islands and the Isle of Man, demonstrate the need for global law enforcement cooperation. For years, authorities have agreed with the widely held notion that these areas are maverick centers of thinly regulated financial activity attracting money launderers and impenetrable by law enforcement. Fortunately, two reports by outside evaluators have dispelled this long-standing myth. The assessment by the director of the Jersey Financial Services Commission sums up the results of these reviews the best: "...the Commission is very conscious of the completely legitimate demands by international customers for privacy in their financial affairs.... At the same time, the Commission believes that it is vital that we, like other Jersey authorities, cooperate fully with others internationally in the fight against crime. When there is an international investigation into financial fraud, we are not prepared to allow Jersey to be the place where the trail goes cold." [17] Expe rience has shown that the authorities in Guernsey and the Isle of Man have adopted the same robust attitude.

Endnotes

(1.) For this article, the author refers to both areas collectively as the Islands.

(2.) In 1999, the Offshore Group of Banking Supervisors (OGBS) organized a Financial Task Force (FATF) evaluation of the Islands. Both the OGBS and the FATF reviews proved favorable to the Islands and found all three jurisdictions cooperative.

(3.) For additional information, see http://www.isle-of-man.com; accessed November 2, 2000.

(4.) For additional information, access the FATF Web site at http:/www.oecd.org/fatf.

(5.) Andrew Edwards, Review of the Financial Regulations in the Crown Dependencies (London, England, 1998). This report became better known as "The Edward's Report."

(6.) Ibid., Part I, Chapter 18, page 161.

(7.) Ibid., Part II, Chapter 2, page 4. In U.S. currency, about $245 billion total, with Jersey at $144 billion, Guemsey at $72 billion, and the Isle of Man at $29 billion.