Pieth: “Panama would be well advised…”

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Pieth
Mark Pieth. Photo by the OECD.

Pieth: Panama would be well advised…

Professor Mark Pieth, who these days teaches at the University of Basel and once headed the OECD’s working group on bribery in international transactions, is a well known authority on white collar crime that crosses borders. He was among those hired by the Varela administration to be part of a “transparency commission” to study and report about the Panama Papers revelations and their significance. He and former Nobel economics prize laureate Joseph Stiglitz, another high profile member of that commission, resigned after the Panamanian government delayed — perhaps forever — publication of a preliminary report and backtracked on its commitment to publish its final report.

The Panama News reached Pieth by email, with three brief but broad questions about the Swiss model that was in part as a banking center for the world’s major criminals, allegations of manipulation that are being aired in Panama’s rabiblanco media and the future of countries which base much of their economies on being financial havens for tax evaders or other sorts of criminals. The following was his reply:

Dear Mr Jackson,

Thank you for your pertinent questions.

To take your first and last question together: in fact, the reaction of official Panama to the data-publication reminded me very much of the attitude of Swiss bankers to foreign critique: denial.

It is correct that the opacity and abuses by the company services industry are not a Panamanian speciality. This is a worldwide problem. All the more it is difficult to understand why the Panamanian Government panicked when they realized that the international experts they had called were going to address the issue from a broader perspective.

Going back to the Swiss experience: Switzerland has realized that there is no chance of survival for a financial center without adopting, implementing and above all applying international standards on preventing tax evasion, money laundering and the like. So the rules have been adopted, and they will be implemented. Instead of living off bank secrecy the Swiss banks are in the process of changing their business model. Likewise Panama would be well advised to develop a new role in the world of business.

On manipulation: Well I think the whole action was quite unprofessional by Government: You don’t ask internationally renowned experts to advise, parade them to the media in order to tell them what to write and that you might keep their report confidential.

Kind regards,

Mark Pieth

 

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