A communiqué from the government of the Isle of Man on Friday:
THE Lord Mayor of the City of London, Alderman David Wootton, is visiting the Isle of Man next week to learn more about the Island’s role as an international business and finance centre.
Tax havens always deny being tax havens, and much prefer these rather grand titles such as ‘international finance centre,’ but anyway. The sentence above, for anyone who’s read Treasure Islands, will be wearyingly familiar. And then there is this:
The Isle of Man has been building relations with the Lord Mayor’s Office in recent years, and one of Alderman Wootton’s predecessors in the role, Alderman David Lewis, described the Island as a ‘core asset’ for the City.
Indeed, just exactly as I have always been saying. Tax havens as gigantic, secrecy-suffused offshore conduits to the City of London. The Isle of Man’s Minister for the Department of Economic Development, John Shimmin, agrees with me, it seems:
“This is another example of how the Isle of Man is a significant contributor to the City of London”
And it’s certainly not the Isle of Man. In Treasure Islands I quote the official Jersey line, which is pretty much the same:
“Jersey represents an extension of the City of London.”
Never underestimate the importance of this. You can not understand the power and reach of the City without understanding the crucial role of tax havens in it. (Likewise, you won’t understand a lot of crime-filled tax havens without understanding the protective political umbrella that the City provides for them.)
As Tax Research also notes, the three largest sources of overseas investment in London’s (stunningly lightly regulated, cowboy-filled) Alternative Investment Market (AIM) are the Isle of Man, Bermuda and the British Virgin Islands. The Isle of Man alone accounted for nearly 20 percent of the total.
And there’s something particularly murky about the offshore companies on AIM. As Tax Research notes:
“One could well wonder what these companies, with a “current market capital of £1.14bn”, actually DO on such a small island. The mind boggles. As to who they are – who can say? The official AIM website appears to have no search facility by geographic location. An independent site at aimlisting.co.uk does have such a facility, but a search for Isle of Man companies returns the helpful message “Sorry but no results were found” (same result for Bahamas, Jersey & Guernsey and just one company under BVI – but around 30 in East Anglia.)”
And he concludes that this sort of thing supports the thesis that the City “runs its own government with its own foreign policy.” Just as Treasure Islands explains, in very great detail.
Endnote: Thomas the Tank engine (pictured) lives on the fictional Isle of Sodor, which is based on the Isle of Man. The Lord Mayor will be interested in this:
A keen railway enthusiast, he will also take a ride on a steam train.
How sweet, pure and innocent!