Virgin Islands Commit to Beneficial Ownership Registry
In a significant move towards combating financial crime, the Virgin Islands government has announced its commitment to implementing a beneficial ownership registry in line with international standards and best practices.
Meeting Global Standards
According to a government press release, Premier Andrew A. Fahie reiterated his government’s commitment to transparency, saying that they will “continue to closely monitor developments in the international financial services industry” and ensure compliance with all relevant requirements.
EU Directive and International Pressure
The move comes as part of efforts to meet the EU’s fifth Anti-Money Laundering Directive, which requires member states to release beneficial ownership registries by 2023. Transparency International UK has welcomed the announcement, calling it a “huge win for anti-corruption campaigners.”
Impact on Financial Crime
A recent study by Transparency International uncovered 1,107 BVI companies connected to corruption cases, amounting to hundreds of billions worth of funds obtained through bribery, rigged procurement, embezzlement and other financial crimes.
- Bribery: Hundreds of billions of dollars in bribes have been paid out to corrupt officials using anonymous companies.
- Rigged Procurement: Companies have used BVI entities to win contracts through corrupt means.
- Embezzlement: Funds have been embezzled from companies and governments using BVI registered entities.
Tax Avoidance Concerns
The move is seen as a significant step towards increasing transparency in the Virgin Islands, which have been linked to several high-profile money laundering scandals. A 2018 BBC investigation found that a quarter of property in England and Wales owned by overseas firms were held by BVI registered entities, adding to concerns about tax avoidance.
Global Witness Reaction
Eva Lee, campaign leader at Global Witness, said: “Every time there’s a global exposé on illicit finance, the BVI’s name comes up. The recent leak of files from FinCEN showed that at least 20% of the occasions when banks in the U.S. raised suspicions of money laundering involved BVI companies.”
Need for Global Action
The new legislation is seen as a significant victory for anti-corruption campaigners, who have been pushing for beneficial ownership transparency for over a decade. However, it also highlights the need for similar efforts to be made in other jurisdictions, including the United States.
Call for International Cooperation
Investigative journalist Scott Stedman called the commitment towards publicly accessible beneficial ownership information a “massive piece of news” in the anti-money laundering community, saying that it will make it harder for corrupt individuals to hide their assets.