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Luxembourg Puts Journalist and Whistleblowers On Trial for Ruining Its “Magical Fairyland” of Tax Avoidance
LUXEMBOURG IS TRYING to throw two French whistleblowers and a journalist in prison for their role in the “LuxLeaks” exposé that revealed the tiny country’s outsized role in enabling corporate tax avoidance.
The trial of Antoine Deltour and Raphael Halet, two former employees of the international accounting firm PricewaterhouseCoopers, and journalist Edouard Perrin began Tuesday.
Deltour and Halet were charged in connection with theft of PwC documents. Perrin is charged as an accomplice for steering Halet toward documents that he considered of particular interest.
Perrin, a reporter with Premières Lignes Television in Paris, produced the first LuxLeaks reporting. PwC documents were later obtained by the International Consortium of Investigative Journalists and, together with records from other accounting giants, formed the basis for the 2014 “LuxLeaks” series involving over 80 journalists across the world.
Among the many prominent supporters of the defendants, France’s Finance Minister Michel Sapin told the French parliament Tuesday that Deltour was “defending the general interest” and that he “would like to offer him all our solidarity.” Almost 175,000 people have signed a petition in support of Deltour.
The European Federation of Journalists has demanded that Luxembourg drop the charges against Perrin. EFJ general secretary Ricardo Gutierrez called Perrin’s prosecution “shameful,” saying that Luxembourg “is going after a journalist who has acted entirely in the public interest.” Reporters Without Borders criticized Luxembourg for being “more concerned about deterring investigative journalism than protecting the public’s right to information.”
So why has Luxembourg’s behavior been so ferocious?
The answer can be found, appropriately enough, in a publication of PricewaterhouseCoopers itself.
According to PwC’s January 25, 2016 “Global Regulatory Briefing,” its international client base now faces “new far reaching developments” on matters including “corporate governance and tax.”
…click on the above link to read the rest of the article…
Taxes and corruption
Taxes and corruption
It seems that the rumbling story about HSBC’s Swiss branch has achieved what political pollsters know as “cut through” – meaning that it’s of interest to voters as well as to those reporters who are sentenced to watch Prime Minister’s Questions each week.
The story reminded me of a passage in Wolfgang Streeck’s 2014 article ‘How Will Capitalism End?’ in which he explores the drivers of change that could bring about, well, the end of capitalism. The article deserves more space here on another occasion, but for the moment I just wanted to quote what he writes about his fifth driver, corruption:
Finance is an ‘industry’ where innovation is hard to distinguish from rule-bending or rule-breaking; where the payoffs from semi-legal and illegal activities are particularly high; where the gradient in expertise and pay between firms and regulatory authorities is extreme; where revolving doors between the two offer unending possibilities for subtle and not-so-subtle corruption; where the largest firms are not just too big to fail, but also too big to jail, given their importance for national economic policy and tax revenue; and where the borderline between private companies and the state is more blurred than anywhere else, as indicated by the 2008 bailout or by the huge number of former and future employees of financial firms in the American government.
So far, fairly familiar, if admirably concise. The more important element here is that what this has done is broken the moral story about capitalism – work and the Protestant ethic and all that – that writers such as Max Weber spent so long trying to assemble at the end of the 19th century and the beginning of the 20th.
…click on the above link to read the rest of the article…
