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This article was originally published by Wealth Adviser.

The publication of the Panama Papers has raised serious questions about global compliance with international regulatory standards, and it is apparent that some jurisdictions have fallen markedly behind in the global efforts to combat money laundering and tax evasion.

By contrast, the Overseas Territories and the Crown Dependencies, being British international financial centres (British IFCs), are rated as having amongst the highest regulatory standards in the world by all international assessments, including by the Organisation for Economic Co-operation and Development (OECD) and Financial Action Task Force (FATF).
 
The British IFCs automatically exchange tax information with the UK and US governments and are amongst the first adopters of the OECD’s Common Reporting Standard (CRS), which will extend information exchange to most other countries. They were also early signatories to the OECD’s Convention on Mutual Administrative Assistance in Tax Matters, a multilateral agreement providing for tax cooperation between its participants. 
 
British IFCs are consequently amongst the hardest places in the world to evade taxes or launder money. These financial centres have laws and courts based on those of the UK and many lawyers and professionals educated, trained and qualified in the UK. The financial regulators in the British IFCs are also recognised members of the International Organization of Securities Commissions (IOSCO), the global standard setter for the securities sector. The key appeal of the British IFCs is the trust placed in them by institutional investors, and so high regulatory standards are of paramount importance to them.
 
Richard Hay (pictured), Counsel to the IFC Forum, says: “It is wrong to bracket all small financial centres together as so-called secrecy jurisdictions. British IFC regulatory standards, including on tracking of beneficial ownership, are judged in peer reviews and authoritative academic studies to be amongst the best in the world.‎ British IFC information exchange standards are also at the leading edge of global standards.
 
“The IFC Forum calls on all financial centres – large and small – to adopt the information collection and exchange protocols endorsed by the international community and which are commonplace in the British IFCs.”

To view the original article please visit Wealth Adviser's website.