Access to fit-for-purpose company data (that is machine readable, contains provenance etc) has fast become an essential ingredient in anti-financial crime efforts.
Whether you’re an investigative journalist, a law enforcement agent or a RegTech product manager, everybody in the anti-financial crime community stands to benefit from open access to company data.
In this context, Rebecca Lee, OpenCorporates’ Chief Impact Officer, took part in a panel discussion at the recent FinCrime World Forum entitled:
‘The drive for corporate transparency in company ownership is more than a technical solution to a problem. It is a matter of social justice’.
Rebecca was joined by:
- Graham Barrow of The Dark Money Files
- Oliver Bullough – well-known journalist and author of works such as Moneyland
- David Balson – Director of Intelligence at RipJar
Here Rebecca shares 6 reflections from this discussion on why transparency of company data is crucial for the fight against financial crime.
PS If you’d rather watch the panel, you can register to view it here.
1. Corporate transparency is a matter of social justice
The panel discussion revolved around a discussion on whether corporate transparency is not just a technical answer to a problem – but whether it is a matter of social justice.
Whilst we at OpenCorporates know the technical challenges of making company data open for all more than anyone, we also know the positive impact open company data creates for society.
That’s why we make all our data openly available via our website, so anybody can access it how and when it’s needed.
The over 400 commercial organisations who use our data at scale via our API and Bulk Data help drive a virtuous circle that further powers our efforts to open up company data – so everybody benefits.
2. Access to company data is vital to investigate wrongdoing
Legal entities are commonly used today as getaway vehicles.
Their once simple purpose, to distribute the risk of legitimate business endeavours, has been co-opted by bad actors – and they are frequently used to obscure illicit activity or ownership of assets that are the proceeds of crime.
Transparency in company data is therefore vitally needed to uncover illicit activity, particularly as 70% of corruption cases typically involve the use of anonymous companies – and report after report has demonstrated that almost all economic crime involves the misuse of corporate entities.
Having access to it facilitates investigations into criminal activities such as money laundering and terrorist financing, but it also helps bring about a more trusted business environment.
Holding companies to account is a collective responsibility that involves both the public and private sector. As examples of this, OpenCorporates’ data has already enabled NGOs such as Global Witness to investigate corruption in Myanmar’s multi-million dollar jade industry, as well as powering RegTech tools such as Exiger’s DDIQ and Encompass to uncover integrity risks at scale.
3. Covid-19 reinforces the urgent need for corporate transparency
With trillions of dollars being distributed by governments to mitigate the financial effects of Covid-19, the need to know what companies exist and the foundational information about them has never been greater.
With financial aid having been distributed at an unprecedented rate, investigations such as the ones carried out by the Anti-Corruption Data Collective and Bloomberg illustrate the crucial role company data plays in allowing potential wrongdoing to be uncovered.
4. Reform is on the horizon
Legislation and regulation are vital tools to improving transparency of company data, especially as access to, or the ability to search, company data varies significantly around the world.
For example, Spain, Italy and Germany, some of Europe’s largest economies, ranked some of the lowest for their access to open company data in our recent report.
Yet there is hope on the horizon.
The EU’s Open Data and Public Sector Information Directive holds the promise that public company datasets will be made openly available across the EU. The challenge, as ever, is in the detail – as some states are seeking to counter this push for transparency by pushing for less data to be available alongside placing restrictive terms on who can access the data in these registries, and how.
5. Greater accountability comes from open access
It is not enough for data on a certain company or officer to be provided on request alone, or for the data to be only available to those that can afford to pay – as this prices out civil society and small or medium sized businesses. This would be especially damaging as SMEs account for the overwhelming majority of businesses, at least in Europe.
Official company data must be made openly available to support anybody looking to conduct research on for example: a potential business partner or client. This is because regulators and legislation across the world expect companies to do their due diligence about who they are in business with and to assess financial crime risk.
And when data is made openly available, there are more people able to analyse and interrogate it and to find anomalies. OpenOwnership has reported that over $1bn USD has been recovered by governments by using the new registers providing beneficial ownership data.
This ‘many eyes’ effect of having millions of people using the data frequently also creates powerful feedback loops for OpenCorporates dataset. As anomalies can be seen more easily, this allows people to correct them in the original source – and these adjustments then flow back into our dataset.
6. Cross-jurisdictional insight is essential
The proceeds of crime typically move between legal entities across borders. So for investigators to identify and recover illicit cross-border money flows, they need to be able to analyse company data between countries.
Company data is usually siloed to each specific jurisdiction’s registry though.
OpenCorporates overcomes this challenge by pulling together company data from 140 jurisdictions into one standardised dataset that follows a single global schema – so cross-jurisdictional insights can be uncovered that wouldn’t otherwise be possible.
You may also be interested in…
Our data helped power a recent investigation by the Anti-Corruption Data Collective into exploitation of the US Paycheck Protection Program. Read more >
Public benefit user?
Are you an investigative reporter or similar professional working for the public benefit? We can provide access to our data at scale for free for public benefit use cases. Enquire now >