Offshore Financial Centre - Scrutiny

Scrutiny

Offshore finance has been the subject of increased attention since 2000 and even more so since the April 2009 G20 meeting, when heads of state resolved to “take action” against non-cooperative jurisdictions. Initiatives spearheaded by the Organisation for Economic Co-operation and Development (OECD), the Financial Action Task Force on Money Laundering (FATF) and the International Monetary Fund have had a significant effect on the offshore finance industry. Most of the principal offshore centres considerably strengthened their internal regulations relating to money laundering and other key regulated activities. Indeed, Jersey is now rated as the most compliant jurisdiction internationally, complying with 44 of the "40+9" recommendations.

In 2007 The Economist published a survey of offshore financial centres; although the magazine had historically been hostile towards OFCs, the report represented a shift towards a much more benign view of the role of offshore finance, concluding:

Although international initiatives aimed at reducing financial crime are welcome, the broader concern over OFCs is overblown. Well-run jurisdictions of all sorts, whether nominally on- or offshore, are good for the global financial system. —The Economist, "A survey of offshore finance: Places in the sun", 23 February 2007

The Channel Islands hold that funds generated offshore do indeed go through the Bank of England allowing the UK to benefit from the success of the crown dependencies as offshore centres.