A couple of weeks ago traders in Barclays Bank were reported as having deliberately lied about fixing Libor interest rates to maximise their own profits on currency dealings.
One week later HSBC, one of the world's biggest banks, apologised for allowing drug gangs to launder billions of dollars.
"One [option] is to tackle the source [such as getting] banks to reveal the names of their offshore clients. The second is to make intermediaries, the financial service providers, accounting firms, legal firms and banks, liable. The third is to act against the tax havens."
- Sony Kapoor, the managing director of Re-Define
A new report has now revealed that some of the world's richest people have more than $30 trillion stashed in offshore tax havens.
A global elite group of super-rich has exploited gaps in cross-border tax rules to hide an extraordinary amount of wealth offshore.
Research commissioned by the campaign group Tax Justice Network says the value is as much as the gross domestic products of the US and Japan combined.
James Henry, a former chief economist at consultancy McKinsey and an expert on tax havens, compiled the most detailed estimates yet of the size of the offshore economy in that report.
The world's super-rich have taken advantage of lax tax rules to siphon off possibly as much as $32 trillion from their home countries and hide it abroad.
In fact, G20 member countries, both developed and emerging economies, have been pledging to close down tax havens since 2008.
Tax loopholes and tax havens are exploited by multinationals and the super-rich to avoid paying high taxes. If tax evasion is a crime, tax avoiders aim to pay the minimum possible without breaking the law.
"Tax avoidance, if aggressively done can fringe on tax evasion, and if it aggressive tax evasion it can fringe on tax fraud. It is a continuum [but] it is illegitimate for sure."
- Myret Zaki, a financial author
John Christensen, an economist with the Tax Justice Network, an organisation fiercely critical of tax havens, told Al Jazeera: "In many cases it's the politicians and their cronies and their families and the business people who sponsor the political parties who are using these offshore financial services so they got no personal interest in closing it down. If they wanted to close it down they could do it tomorrow.
"It's not a question of rocket science and how difficult to do that, all they have to do is improve information exchange between countries and require disclosure of information about offshore accounts, offshore companies, offshore trusts. The fact of the matter is they don't want to do it because they themselves are complicit with the process."
Inside Story asks: Should these havens be allowed to exist? Is paying tax good or bad? Why do the wealthiest people on earth hide their money in tax havens? Is it greed or a lack of trust in their governments? Why are they not caught, held accountable and forced to pay their taxes like everyone else?
Joining the discussion with presenter Stephen Cole are guests: Jean-Pierre Diserens, the general-secretary of the Convention of Independent Financial Advisors; Myret Zaki, a best-selling financial author of UBS: Below a scandal, Banking Secrecy is Dead, Long Live Tax Evasion, and The end of the dollar; and Sony Kapoor, the managing director of Re-Define, an international think tank that advises governments and policy makers on economic and financial sector policy.
"We have to be very careful not to mix the criminal money with [honest] money ... that money doesn't just sit in the vault. That money, if earned honestly, is invested in the real economy and it is creating jobs. It's just the cost factor of excessive taxation that has been reduced."
Jean-Pierre Diserens, the general-secretary of the Convention of Independent Financial Advisors
TAX HAVENS DETAILS:
- Out of an estimated world population of seven billion, just 10 million people hold offshore accounts containing in total $32 trillion.
- Half of that amount is owned by just a 100,000 people - the super, super-rich.
- An estimated half a trillion dollars has left Russia since 1990, meaning the tax on that money has not been invested in the country.
- If governments in sub-Saharan Africa had been able to tax the many hundreds of billions of dollars sent abroad, they would have been enough to pay off their crippling debts.
- Despite the criticism it can attract, the process is legal and is used on a daily basis by banks around the world.