European Parliament Committee of Inquiry on Money Laundering, Tax Avoidance and Tax Evasion

European Parliament Committee of Inquiry on Money Laundering, Tax Avoidance and Tax Evasion was established by the European Parliament in 2016 to investigate and report on the Panama Papers scandal, which involved Mossack Fonseca, HSBC, and other major financial institutions, including UBS, Credit Suisse, and Deutsche Bank. The committee's work built on previous investigations, such as the Offshore Leaks and LuxLeaks scandals, which exposed widespread tax evasion and money laundering practices involving Apple, Google, and Amazon. The committee's mandate was also influenced by the work of International Consortium of Investigative Journalists and Transparency International, which have been instrumental in uncovering corruption and financial crimes worldwide, including in countries like Switzerland, Luxembourg, and Cayman Islands.

● Introduction

The European Parliament Committee of Inquiry on Money Laundering, Tax Avoidance and Tax Evasion was formed in response to the Panama Papers scandal, which revealed widespread tax evasion and money laundering practices involving politicians, business leaders, and celebrities, including Vladimir Putin, Mauricio Macri, and Lionel Messi. The committee's work was also informed by the FATF (Financial Action Task Force) recommendations and the OECD (Organisation for Economic Co-operation and Development) guidelines on tax transparency and exchange of information, which have been implemented by countries like United States, United Kingdom, and Germany. The committee's investigations involved cooperation with other European Union institutions, such as the European Commission, European Council, and European Court of Justice, as well as international organizations like the IMF (International Monetary Fund) and the World Bank.

● Mandate and Scope

The committee's mandate was to investigate the Panama Papers scandal and its implications for the European Union's tax policies and anti-money laundering regulations, including the Fourth Anti-Money Laundering Directive and the General Data Protection Regulation. The committee's scope included examining the role of financial institutions, such as banks and law firms, in facilitating tax evasion and money laundering, including the activities of KPMG, PwC, and Ernst & Young. The committee also investigated the use of offshore accounts and shell companies by individuals and companies, including Appleby and Asiaciti Trust, and the impact of tax avoidance and tax evasion on public finances and social welfare in countries like Greece, Ireland, and Portugal.

● Investigations and Findings

The committee conducted hearings and gathered evidence from experts, whistleblowers, and financial institutions, including HSBC, UBS, and Credit Suisse. The committee's investigations revealed widespread non-compliance with anti-money laundering regulations and tax laws, including the Common Reporting Standard and the Foreign Account Tax Compliance Act. The committee also found that financial institutions had failed to implement effective anti-money laundering measures, including customer due diligence and suspicious transaction reporting, which has been a concern for regulators like the Financial Conduct Authority and the Securities and Exchange Commission. The committee's findings were presented in a series of reports, which included recommendations for improving tax transparency and anti-money laundering regulations, including the implementation of public country-by-country reporting and beneficial ownership registers.

● Recommendations and Impact

The committee's recommendations included strengthening anti-money laundering regulations, improving tax transparency, and enhancing international cooperation on tax matters, including the implementation of the BEPS (Base Erosion and Profit Shifting) project and the OECD's Common Reporting Standard. The committee also recommended the establishment of a European Union-wide financial intelligence unit to coordinate anti-money laundering efforts, which has been supported by organizations like Europol and Eurojust. The committee's recommendations have had a significant impact on European Union tax policies and anti-money laundering regulations, including the adoption of the Fifth Anti-Money Laundering Directive and the Directive on Administrative Cooperation.

● Membership and Structure

The committee consisted of Members of the European Parliament from different political groups, including the European People's Party, Progressive Alliance of Socialists and Democrats, and Alliance of Liberals and Democrats for Europe. The committee was chaired by Petra Kammerevert and included vice-chairs from different political groups, such as Sven Giegold and Evelyn Regner. The committee's membership also included experts and advisors from financial institutions, tax authorities, and civil society organizations, including Transparency International and the International Consortium of Investigative Journalists.

● Proceedings and Reports

The committee held numerous hearings and meetings with experts, whistleblowers, and financial institutions, including HSBC, UBS, and Credit Suisse. The committee's proceedings were transparent and open to the public, with all meetings and hearings streamed live on the European Parliament's website. The committee published several reports, including a final report that summarized its findings and recommendations, which has been cited by organizations like the IMF and the World Bank. The committee's reports have been widely cited and have contributed to the development of European Union tax policies and anti-money laundering regulations, including the implementation of the General Data Protection Regulation and the Payment Services Directive.

Category:European Parliament committees