British overseas territories sign deal to curb tax evasion

By David Milliken

LONDON (Reuters) - Tax havens such as Bermuda and the Cayman Islands will work more closely with Britain and other European countries to fight tax evasion, Chancellor George Osborne said on Thursday.

With governments in most advanced economies short of tax revenue after the financial crisis, pressure has been growing on small territories with big banking sectors to lift bank secrecy and do more to combat tax dodging and money laundering.

The United States has been in a lengthy dispute with Switzerland over the latter's bank secrecy rules, while the European Union also has turned up pressure on two of its smaller members, Austria and Luxembourg.

Austria in turn has accused Britain and the United States of shielding their own tax havens.

Now British overseas territories such as Bermuda, the Cayman Islands and the British Virgin Islands - which are effectively colonies with some self-government - will have to automatically provide details the ownership of bank accounts, and about how they are used, the Treasury said.

"This represents a significant step forward in tackling illicit finance and sets the global standard in the fight against tax evasion," Osborne said.

The information will be shared by Britain, Germany, France, Italy and Spain, which agreed in June last year to work together to combat tax evasion.

The Isle of Man also will be subject to the deal, but two other major offshore centres, Jersey and Guernsey, have not yet agreed to share information with countries other than Britain.

The other territories affected by the deal are the Caribbean islands of Anguilla, Montserrat and the Turks and Caicos.

Britain has made fighting tax evasion a priority while it chairs the G8 group of advanced economies this year, and in two weeks it will host a meeting of finance ministers from the bloc.

However, Britain also faces problems of its own in being certain that companies comply with its tax laws.

A Reuters investigation published on Wednesday highlighted inconsistencies in the way Google portrays its activities in Britain, prompting parliamentarians to demand the company's executives and auditors appear before them.

(Editing by Michael Roddy)

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Bin Laden son-in-law detained overseas, brought to New York

WASHINGTON (Reuters) - A son-in-law of Osama bin Laden who served as al Qaeda's spokesman has been arrested and detained in Jordan in an operation led by Jordanian authorities and the FBI, U.S. government sources said on Thursday.

The sources said Suleiman Abu Ghaith, a militant who had appeared in videos representing al Qaeda after the September 11, attacks on New York and Washington in 2001, had initially been picked up in Turkey.

The Turkish government then deported him to Jordan, said the sources, where local authorities and the FBI took custody of him.

Initial public confirmation of Abu Ghaith's capture came from Representative Peter King, a senior Republican member of the House of Representatives Intelligence Committee and former chairman of the House Committee on Homeland Security.

"I commend our CIA and FBI, our allies in Jordan, and President (Barack) Obama for their capture of al-Qaeda spokesman Sulaiman Abu Ghaith. I trust he received a vigorous interrogation, and will face swift and certain justice," King said in a statement.

"Propaganda statements in which Abu Ghaith and his late father-in-law, Osama bin Laden, praised the terrorist attacks of September 11, 2001 are alone enough to merit the most serious punishment."

U.S. sources indicated that, while a CIA role in the capture of Abu Ghaith could not be ruled out, the FBI took the lead role in the operation under the auspices of an interagency body known as the High-value Detainee Interrogation Group.

The group was created by Obama's administration after the president ordered the permanent shut down of a CIA program in which militant suspects were detained and held in a network of secret prisons, during the administration of President George W. Bush. The suspects were sometimes subjected to controversial and physically coercive "enhanced interrogation techniques," and also sometimes transferred without trial to third countries under a procedure known as "extraordinary rendition."

Precisely what the FBI and interrogation group now intend to do with Abu Ghaith was not immediately known. Sources said one possibility is that he could be brought to the United States for trial in an American court.

The Justice Department declined to comment.

(Editing by Warren Strobel and Christopher Wilson)

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