Tax whistleblowers

25 Feb 2008 By William Echikson

The Alpine tax haven’s reputation for bank secrecy will be badly damaged by revelations that the UK, as well as Germany, has paid for stolen bank details. The tactic is legally defensible and will make current and future cheats think twice.

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The UK tax authority has acknowledged paying an informant for data regarding British citizens who have accounts in tax haven Liechtenstein. The Sunday Times newspaper claimed the amount paid was £100,000 but that figure was not confirmed. The UK tax authority said it had made the move in a bid to protect the UK against those trying to "deprive the UK of tax revenues to which it is entitled".

Germany reportedly paid the informant E5m for information. LGT Group, the Liechtenstein bank owned by the principality's ruling family, says the records stolen and passed on to German tax authorities contain data from 1,400 clients, about 600 of them Germans.

Tax authorities in the US, France, Canada and Australia are investigating client data tied to LGT, according to the Wall Street Journal. US Senator Carl Levin has said that the bank "apparently harbored numerous secret accounts which hid the taxable assets of thousands" of people around the globe.

In response, the country's head Prince Alois von und zu Liechtenstein has argued that Germany's move is illegal. Liechtenstein is now conducting its own investigation. The Organisation for Economic Cooperation and Development lists Liechtenstein as one of only three states remaining on its blacklist of "uncooperative tax havens".

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