A critical and justified take on the City from France

Barely twenty-four hours after the Cahuzac scandal broke in France, another financial revelation came to light, albeit of a more international nature. The International Consortium of Investigative Journalism (ICIJ), released findings of more than a year’s work detailing the roles of French banks in helping their clients hide money from the tax authorities.

Le Monde has picked up on the ‘silence radio’ in London, and Marc Roche, its correspondent in London, pithily remarks that in fact London is the fiscal paradise ‘par excellence.’ This is obviously demonstrated in the recent wave of financial scandals that have crashed down on the City; laundering drug money, brazenly ignoring international sanctions, dodgy arms deals, and, of course, the rigging of Libor rates. Yet, while in France BNP Paribas and Credit Agricole are having to furiously play down their roles in helping their clients create offshore accounts in the Virgin Islands, Samoa, Singapore and Hong Kong, among others, the British press has yet to comment.

You can’t have a ‘trust’ in France. That is to say, you can’t create an account in the name of a company that doesn’t actually employ anyone. By law, you have to be able to find out who is the beneficiary of all accounts held in France banks, whether in national or international branches. So, Roche points out that the City, (namely audit firms and law firms) is also adept at managing these trusts in order to cover the tracks of financial evasion. According to him, the deafening silence in the British Press (apart from coverage in The Guardian) following these revelations is easily understandable, given the context of everyone being in each other’s pockets.  And, what could demonstrate this more poignantly then a quick survey of the state of British journalism which reveals that News Corp (Sun, Sunday Times, Times) is made up of over 800 companies, most of which are registered offshore, and Richard Desmond (Express), Evgeny Lebedev (Evening Standard), and Lord Rothermere (Daily Mail) are all in the same situation. And let’s not even talk about the Financial Times, Roche suggests, as it’s now common knowledge that it puts its client’s interests (the City, Wall Street, and Asia) above all other concerns, most notably that of investigative journalism.  It’s a cynical view from abroad of the way that the City operates, but one that makes entire sense.

On another note, on Le Figaro’s website, one can access a helpful article explaining how, given that the French are hiding 600 billion euros offshore, one can make sure, when it comes to important issues such as the heath of one’s bank account, one stays within the law. How useful.

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