UK Edition
Paradise Papers was 'ploy' to influence first ever tax haven blacklist
A Guernsey finance chief has claimed that the release of the Paradise Papers was ploy by left-wing media to influence the first ever tax haven blacklist.
Dominic Wheatley, CEO of Guernsey Finance, said that there was a lack of "balance and objectivity" in coverage of the data leak which revealed among other things that the Queen, Prince Charles and Bono were linked to offshore investments.
Instead of showing illegal transactions, the Paradise Papers served only to distract attention away from the real debate of how to ensure tax transparency, he said.
Mr Wheatley, whose role is funded by the Guernsey Government with contributions from the industry, said: "I think that the timing was deliberately manipulated in an obvious attempt to influence the process of the EU blacklist. This is actually an attempt at political manipulation rather than investigative journalism."
On December 5 the European Council will release a blacklist of non EU-countries that are deemed to be tax havens.
The criteria for fair tax rules include not offering preferential tax measure, not allowing companies to move profits to avoid tax and to meet transparency guidelines set by the OECD.
It is understood that after screening 92 counties up to 36 could be included on the list including Serbia, Armenia, Cook Islands, the Marshall Islands, Panama and Tunisia. Leaked versions of the list show UK territories including Guernsey, the Isle of Man and Jersey have been deemed compliant with regulations.
"The (Paradise Papers) coverage itself undermined the integrity of anything that they were trying to say. The BBC's Panorama was a long was from the standard of journalism you would expect from the BBC. There was a lack of balance and objectivity," Mr Wheatley said.
Guernsey is under constant review against the guidelines and "we have always been fully compliant and passed with flying colours."
He continued: "Aggressive tax avoidance practices are no more regarded as acceptable by people in Guernsey than they by people here in the UK."
Guernsey argues that the amount said to be lost in offshore tax avoidance is "overestimated" and "everyone including the Treasury" agrees that the biggest leakage is in the black market and the cash economy, he said.
The UK and Guernsey have a "mutually beneficial agreement" which sees much of the money pass through London and £35bn from Guernsey funds is invested into UK assets including property and infrastructure.
The Paradise Papers contained data that was obtained by a hack on Appleby, one of the world's biggest offshore law firms, which has offices in Guernsey though the servers on the island were not breached.
Mr Wheatley questioned whether the International Consortium of Investigative Journalists was justified in obtaining the information from a criminal hack as it did not appear to have exposed any illegality.
"There were some stories that sparked one's curiosity but public curiosity is not the same as public interest. This is illegal theft of data," he said, adding: "I don't think it has revealed any issue of public interest."
In the offshore world there are certain practices which universally agreed to be acceptable whilst aggressive tax avoidance and the laundering of criminal proceeds is internationally condemned.
But there are some practices in the "amber" zone which have yet to be defined and this is where the real debate needs to take place so a standard can be set and followed, Mr Wheatley said.
"The Paradise Papers is a distraction from the proper debate which is being had by the people who are engaging intelligently in this issue, it is not the debate that is being pursued by Panorama who were just trying to portray off shore finance in a negative way for their own political ends," Mr Wheatley said.
The BBC said that the timing of the release had been agreed by news organisations around the world who partner with the ICIJ.
A spokesman said: "This investigation shows there is clear a public interest in the information being reported. It has been conducted in a fair and impartial way by our award-winning current affairs programme Panorama and BBC News journalists.
"The revelations were part of a much wider leak of 13 million documents that have been shared with 100 other news organisations in 67 countries around the world by the International Consortium of Investigative Journalists.