THE NEED FOR INCREASED FINANCIAL TRANSPARENCY AND PRIVACY WAIVERS
Big business and political leaders often panic when they see their new names in newsprint or in other public media. Their first question is to ask how the media got hold of the relevant information.
The answer is probably closer to home than most people realize. In many cases, the news material has come from their own camp. The disclosure is not always for malicious reasons. It can be often as a result of inadvertent disclosure – someone not thinking through the privacy implications of their activities.
Many legal actions often ignore privacy considerations. Examples are planning applications with little thought as to how the details of someone’s home can be kept private. Litigation is often commenced with private details being needlessly incorporated into pleadings. Social media accounts are a prime source of inadvertent disclosure of private information including private pictures and information.
Australian and United Kingdom laws are beginning to require more personal information to become public. New legislation requires companies to keep a register of individuals who control significant shareholdings within a firm. Non-compliance with the disclosure obligation will be a criminal offence. Such shareholders who exercise significant control over a company will need to disclose their year and month of birth, their nationality, their country of residence, their service address, the date they became a person with significant control and the actual level of ownership or voting rights in the corporation.
On its own, the information may seem innocuous. Together, however, the information can reveal a great deal about an individual. It is not difficult for a hacker to find the full date of birth from just the month and year which will allow phishing campaigns.
Australia and United Kingdom Governments amongst others are determined to create more transparency to deal with tax evasion, money laundering and the financing of terrorism. These initiatives align countries with important anti-money laundering laws and directives in the European Union and in the United States. Increasingly, beneficial ownership is now being required to be registered.
Accordingly, privacy must factor into financial planning to a far greater degree having regard to the increased push for transparency. The critical question to ask when considering any business initiative is what personal information will have to be placed into the public domain. Effective steps can then be taken to avoid disclosing private information needlessly. For instance, in relation to corporate disclosure of significant controllers, service addresses rather than private addresses should be given.
Furthermore, privacy in the area of fiscal transparency must not be considered in isolation. Commercial, social, physical and digital confidentiality should be viewed holistically. Vulnerability in one area can impact elsewhere. A leaky or inadequate digital footprint can lead to intrusions into private relationships. Careful planning and close scrutiny of information which has been relinquished through business arrangements will help maintain the private aspects of public lives. Maintaining this balance is very important in an age where the constant developments in technology make the protection of privacy a hydra-like struggle.
This article is intended only to provide a summary of the subject matter covered. It does not purport to be comprehensive or to render legal advice. No reader should act on the basis of any matter contained in this article without first obtaining specific professional advice.
DISCLAIMER: We accept no responsibility for any action taken after reading this article. It is intended as a guide only and is not a substitute for the expert legal advice you can get from De Marco Lawyers and other relevant experts.