City of London Corporation - Criticism

Criticism

The City of London Corporation has been criticised by Nicholas Shaxson for being undemocratic and a privileged haven for banks, financial institutions and big businesses. Nicholas Shaxson sees it as an old boys' network and has branded it a tax haven. Although Monbiot does not detail how a business in the City can avoid the UK Tax Authority's powers, Nicholas Shaxson explains how, with the aid of UK trust law and creative accounting, City businesses can conceal much of their taxable income:

Offshore financial structures typically involve a trick sometimes known as laddering—a practice also expressed by the French word saucissonage, meaning to slice something into pieces like a sausage. When you slice a structure among several jurisdictions, each provides a new legal or accounting “wrapper” around the assets that can deepen the secrecy and the complexity protecting the assets. A Mexican drug dealer may have $20 million, say, in a Panama bank account. The account is not in his name but is instead under a trust set up in the Bahamas. The trustees may live in Guernsey, and the trust beneficiary could be a Wyoming corporation. Even if you can find the names of that company’s directors, and even get photocopies of their passports—that gets you no closer: These directors will be professional nominees who direct hundreds of similar companies. They are linked to the next rung of the ladder through a company lawyer, who is prevented by attorney-client privilege from giving out any details. Even if you break through that barrier you may find that the corporation is held by a Turks and Caicos trust with a flee clause: The moment an inquiry is detected, the structure flits to another secrecy jurisdiction. Even if a jurisdiction cooperates with inquiries, it can drag its feet for months or years.

Monbiot has criticised 'the City Cash' missing the point that this income comes from its own assets and investments and this subsidises both its own public expenditure requirements and its aid across the rest of the metropolis without need of central government grant or having to levy higher rates of Council Tax. Nor does he mention that 97% of its Business Rates are distributed to other Greater London Boroughs needs. He has also attacked the role and office of the City Remembrancer; there is not a local authority in the country that does not employ directly or through consultancies an advisor with the same remit in lobbying government and parliament. The last occasion that this Officer delivered a petition to the Commons was to attempt to retain a separate MP for the City in 1948 when all of the anomalous constituencies, such as those of the Universities, were abolished.