What have the CRS, BEPS, FATCA and Beneficial Ownership Registers Achieved?

Take the case of beneficial ownership registers. Opaque corporate vehicles have been at the heart of virtually every major corruption and money laundering scandal in recent years. In the ongoing Danske Bank case, for example, just four shell companies registered in the UK with accounts at the Estonia branch of the bank allegedly laundered US$2.9 billion.

In recent years, a growing number of countries have committed to set up public registers of beneficial ownership to tackle this global challenge. While only a handful have actually done so in practice, a number of outcomes are already clear.

From the Azerbaijani Laundromat to the Panama Papers, access to beneficial ownership information has been an essential tool to uncover financial crime and wrongdoing. The fact that it is journalists uncovering these stories only reinforces the argument that public access to this information is necessary.  

Beneficial ownership transparency also has a proven preventive function. For instance, after transparency requirements were extended to Scottish Limited Partnerships (SLPs) - regularly reported as having links to organised crime and money laundering - new incorporations of SLPs fell by more than 45%.

Meanwhile, the warnings regarding the downsides of increased transparency have been overstated. For example, the UK public register has shown that concerns about privacy can be dealt with responsibly on a targeted, case-by-case basis.

Lastly, public awareness about the impact of financial opacity, including its links to issues such as global inequality and the influence of obscure funding in politics, continues to grow. At the recent International Anti-Corruption Conference in Copenhagen, civil society organisations reaffirmed their commitment to campaigning for transparency in the global financial sector. Leading governments and corporate leaders are also being increasingly vocal in their willingness to support and extend transparency initiatives.

As more countries and companies join them, and the global debate moves beyond the accessibility of data towards issues such as data quality or increasing the capacity of public authorities to cooperate across borders, those who continue to resist the trend towards transparency run a rising risk of isolation.

Patricia Moreira
Managing Director, International Secretariat of Transparency International, Berlin, Germany. She has worked for more than a decade promoting social impact and innovation in a global environment.