Government has hit back at attempts by a Berlin-based anti-corruption agency to portray Bermuda as one of the world's "banking outlaws'' against which international action should be taken.

In a Press statement released yesterday Finance Minister Eugene Cox said Transparency International (TI) was mistaken in labelling the Island as an offshore banking centre, and referred to the Island's participation in international organisations and legislation on money laundering. He was responding to comments by TI chairman Peter Eigen, who specifically named Bermuda, the Cayman Islands, the Isle of Man, the Channel Islands, Antigua, Liechtenstein, Luxembourg, Monaco and Switzerland as "prime destinations for illegal funds''.

Mr. Cox pointed out that Bermuda only had three local banks, controlled locally, and regulated by the Bermuda Monetary Authority (BMA). The BMA was committed to international banking standards of the Basle Committee on Banking and sat on a working committee of the organisation, he stated. The BMA was also a member of the Offshore Group of Banking Supervisors.

"Secondly, the Island has always employed a system of vetting the fitness and propriety of the beneficial owners of businesses wishing to incorporate here -- ensuring we were in a position to `know our customers' long before such an approach became the international requirement that it is today,'' he stated.

He listed the Tax Information Exchange Agreement with the US, the Criminal Justice (International Co-operation) (Bermuda) Act, and the Proceeds of Crime Act as legislation on the books to combat money laundering.

"All of these factors clearly demonstrate Bermuda's commitment to combatting financial crime and money laundering, and also demonstrate why I must, therefore, categorically reject TI's characterisation of Bermuda in its recent statements,'' he said.

A copy of the Press statement has been sent to TI. Mr. Eigen had called for Bermuda and other "rogue offshore financial centres'' to be excluded from the international banking system.

Eugene Cox