2011 Financial Secrecy Index

October 4th, 2011

The 2011 Financial Secrecy Index (FSI) focuses on 73 secrecy jurisdictions.  These places set up laws and systems which provide legal and financial secrecy to others, elsewhere.

The FSI combines two measurements, one qualitative and one quantitative. The qualitative measure looks at a jurisdiction’s laws and regulations, international treaties, and so on, to assess how secretive it is.  The assessment is given in the form of a secrecy score: the higher the score, the more secretive the jurisdiction.  The second, quantitative, measurement attaches a weighting to take account of the jurisdiction’s size and overall importance to the global financial markets. In combining the two scores, we mathematically emphasise the secrecy score and de-emphasise the weighting, in order to give secrecy its due importance.

The Financial Secrecy Index website provides our main talking points and some analysis. However, it is backed by a second website, called Mapping Financial Secrecy, which contains a wealth of much more detailed research and data, along with a glossary

The 2011 FSI ranking cannot be directly compared to our inaugural FSI, published in 2009. Although the methodology is largely comparable to the last one, we have improved it in several respects and we include more jurisdictions than last time. One important change is that when combining the secrecy score with the weighting, we emphasised the secrecy score relative to the weighting even more than we did in 2009. Because of these changes, it makes little sense to say things like ‘x country has moved up/down five places since 2009.’ (See more details on this below.)

The FSI differs from rankings which focus on identifying corruption and governance problems within countries. In this sense, it is unique. Because the core business of secrecy jurisdictions is to facilitate criminal and other activities carried out elsewhere, in a world of global financial movements it makes no sense to focus only on what happens inside individual jurisdictions. So financial secrecy must be analysed according to how laws and regulations in one jurisdiction change the behaviour of others elsewhere.

The 2011 FSI ranks the jurisdictions most to blame for supplying financial secrecy, and provides pointers for global action.

Read a full description of how the FSI is calculated, in our full methodology here. Download the index here.

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