UN FACTI Panel outlines action against systemic abuse

A high-Level Panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Agenda, known as the FACTI Panel, has released its final report outlining recommendations to end poverty and address climate change through the reform of global finance. Chaired by former Prime Minister of Niger, Ibrahim Mayaki, the panel emphasizes the need for stronger laws and institutions to prevent cross-border corruption and money laundering. The FACTI Panel, comprised of academics, financial experts, and civil society representatives, worked intensively for nearly a year to develop significant recommendations aimed at addressing the systemic issues underlying illicit financial flows. Mayaki underscored the panel's focus on identifying and closing the gaps in existing frameworks rather than duplicating efforts. One of the key points highlighted in the report is the panel's systemic approach to tackling financial integrity issues. By interlinking recommendations related to enablers of corruption, tax conventions, public registries of beneficial ownership, and the involvement of civil society and journalists in exposing malpractice, the panel aims to create a comprehensive strategy to combat financial crimes. Mayaki emphasized the urgent need to address illicit financial flows, referring to them as 'double theft' that deprives billions of a better future. The panel's report reveals staggering statistics, such as 10% of world GDP being held in offshore financial assets, $1.6 trillion lost annually to money laundering by criminals, and $7 trillion of private wealth hidden in tax havens. These figures underscore the magnitude of the challenge and the necessity for global cooperation and political determination to address the issue. The evolving landscape of global finance, including new forms of financial instruments like cryptocurrency, poses additional challenges in combating financial crimes. Mayaki stressed the importance of adapting mechanisms to tackle these moving targets, with a focus on enhanced transparency, frameworks, and a new global pact for financial integrity. Moreover, Mayaki discussed the practical steps needed to translate the panel's recommendations into action, particularly in the African context. He highlighted the work of the African Union in addressing tax evasion and avoidance by multinational corporations, especially in sectors like mining. By increasing the capacity of national tax authorities and implementing measures to curb profit shifting, African countries can mobilize domestic resources effectively. The discussion also touched upon the broader narrative of 'The Africa We Want' under Agenda 2063, emphasizing the critical need for financial resources amid the continent's first recession in 25 years. Mayaki underscored the importance of national and international cooperation to implement norms, such as a global corporate tax rate, to ensure transparency and ethical financial practices. In conclusion, Mayaki emphasized the imperative of political determination in driving the adoption of measures to enhance financial integrity and transparency. He called for a revolution in the systems governing financial practices to address the root causes of corruption and inequality. As global challenges like the COVID-19 pandemic exacerbate existing financial vulnerabilities, the FACTI Panel's recommendations stand as a crucial roadmap for building a more equitable and sustainable financial ecosystem.