Criticism over diamond dealer tax settlement

Summary

A settlement between Omega Diamonds and the special tax investigation unit of the finance ministry in which the company paid to avoid prosecution has come in for severe criticism. The Antwerp-based diamond trading company agreed to pay €160 million in fines to avoid being prosecuted for tax evasion and money laundering.

A settlement between Omega Diamonds and the special tax investigation unit of the finance ministry in which the company paid to avoid prosecution has come in for severe criticism. The Antwerp-based diamond trading company agreed to pay €160 million in fines to avoid being prosecuted for tax evasion and money laundering.

Omega was suspected of using money laundering circuits in Switzerland and Dubai to keep income from diamonds from Angola and Congo – allegedly including banned “blood diamonds” – from the tax authorities’ attention. The total value of the laundered income is thought to be about €2 billion.

Nevertheless, under a recent arrangement introduced by the Di Rupo government to avoid long drawn-out fraud trials, companies or individuals suspected of tax evasion are now able to come to a settlement with the authorities. Costly legal procedures are avoided, and the public purse receives the money it was missing. The tax owed is paid, which is an important consideration in times of economic difficulties.

But the companies escape prosecution. Michel Maus, lecturer in tax law at the Free University of Brussels (VUB), said the agreement “looks like class-based justice. I’m not against the system of settlements, but the policy has to be just and fair for everyone.

Small-time tax dodgers who have evaded for small sums have to pay a fine and are prosecuted in court, with a criminal record as a fraudster as a result. Meanwhile, larger companies strike a deal, there’s no prosecution, and those involved walk away without a mark against their name.”

John Crombez, the government’s secretary of state in charge of the fight against fraud, said he was happy a settlement had been reached but hoped the system of settlements would soon come to an end. “I hope the courts will be able to take hard and fast action against these major cases in the near future,” he told VRT radio. “We cannot keep going on with this system.”

Criticism over diamond dealer tax settlement

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