During a recent parliamentary debate, veteran MP Dame Margaret Hodge accused Britians Overseas Territories and Crown Dependencies of actively facilitating financial secrecy that enables widespread economic crimes.
Hodge cited mounting leaks of offshore financial data over recent years that consistently expose the outsized role played by territories like the British Virgin Islands in providing anonymous shell companies at the heart of tax dodging and money laundering schemes.
She pointed specifically to revelations in the Panama Papers, Paradise Papers, FinCEN Files and Pandora Papers that together exposed assets and dealings of high-profile politicians, public officials, tax evaders and criminals obscured behind secretive offshore corporate structures.
The veteran legislator further highlighted a World Bank analysis finding that UK territories were the second most common jurisdiction associated with over 2000 global corruption cases studied – with their corporate secrecy laws repeatedly exploited by the corrupt to conceal illicit gains.
Hodge argued this environment of intentional opacity actively empowers white-collar crime and must be confronted head-on with transparency measures like public beneficial ownership registers. She stressed the UK holds unique responsibility and oversight to compel action from its territories and dependencies facilitating financial secrecy.
The British Virgin Islands government has affirmed its commitment to implementing a publicly accessible register of beneficial ownership (PARBO) consistent with evolving international financial transparency standards. However, officials have stressed that, in light of recent developments, such implementation must properly balance transparency aims with privacy and data protection rights. Premier Dr the Honourable Natalio Wheatley spoke on the subject at a recent press conference.
Wheatley also noted that the territory already has a longstanding collaboration with global partners to exchange information with the aim of combatting illicit finance. He said that the BVI has been an effective and responsible partner over the years.
Financial Services Minister Hon. Lorna Smith said in a subsequent statement that requests for ownership data will require passing a “legitimate interest test” focused on preventing financial crimes, adding that technical teams will build systems delivering the government’s PARBO pledge while incorporating proper safeguards.
Minister Smith also maintained the territory’s longstanding, proactive collaboration with the UK and global partners to exchange vital information combatting money laundering and sanctions evasion. She said that this cooperation remains a cornerstone of the BVI’s approach even as it acts to uphold basic human rights when increasing access to sensitive individual data.