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Abstract: 

The recent “Panama Papers” leak of internal documents detailing the use of offshore entities for suspected tax evasion generated significant press coverage and launched public enforcement activities around the world. Given increased cross-border cooperation among enforcement authorities and more aggressive efforts to pressure financial institutions to provide information about offshore entity account activity, global financial institutions should examine their compliance regimes, “Know Your Client” and new client adoption procedures, and scrutinize their relationships with non-transparent entities. The reason for this is simple: if financial institutions do not, it’s quite possible that enforcement authorities will.

Keywords: Panama Papers, FATCA, tax compliance, OECD Common Reporting Standard, cross-border enforcement, institutional liability, “Know Your Client” procedures, DOJ Swiss Bank Program, Bank of Nova Scotia summons

Affiliations:  1: Paul Hastings; 2: Paul Hastings.