BBC Panorama exposé 'not regular practice' - Jersey

Jersey’s Government has refuted claims the actions of one Lloyds offshore banker exposed on a BBC Panorama programme are representative of practices on the island.

Panorama's 'Banks Behaving Badly' report showed an employee at a Jersey-based branch of Lloyds TSB Offshore giving advice to an undercover customer with £4m to invest.

During the filming, the banker told the prospective ‘client' income earned on deposits held offshore are paid to clients via Hong Kong to "get round" the European Savings Tax Directive.

A Jersey Finance spokesman says the report focused on one individual employee and "is in no way a reflection of regular practice and compliance standards within Lloyds Banking Group or Jersey's finance industry generally".

Chief minister of Jersey, Terry Le Sueur, says the island's laws on tax information exchange are clear.

"Jersey has laws in place to prevent its use by those engaging in activities involved with tax evasion and has always made this clear to the financial institutions operating in the island.

"Should there be any evidence of a breach of Jersey's laws or regulations, the relevant authorities will open their own investigation with follow-up action as soon as possible."

The latest IMF review praised Jersey's high standards of regulation and supervision. The island is also on the OECD's 'white list' of jurisdictions which meet international rules on tax information sharing.

Geoff Cook, chief executive of Jersey Finance, says: "The standards of Jersey's financial services regulations and supervisory capabilities are either ahead of, or on a par with, the regulatory positions of both EU Member States and G20 countries.

"The actions of one lone individual should in no way detract from this achievement," he says.

Barclays Banking Group says:"We strongly and categorically refute any allegation of involvement in systematic or deliberate tax evasion."

Lloyds has suspended the employee and is conducting a full investigation, working with HMRC and the appropriate regulatory authorities.