The Financial Secrecy Index, a cherished tool for policy research across the globe

The Financial Secrecy Index is used by banks to fight money laundering, by academics to investigate the English Premier League, and by leading institutes to enrich their renowned databases.

As a comprehensive and reliable source of information on jurisdictions’ contributions to financial secrecy, researchers and institutions around the world rely on the Financial Secrecy Index and incorporate its results into their work, showcasing the index’s ability to contribute to a wider understanding of the various aspects of financial secrecy and its broader impact on society.

While in the last decade, there have been so many interesting examples of the use of the index (see a non-exhaustive list here), in this blog we focus only on a few recent examples of fascinating work by various researchers and institutions, hoping to provide you with a flavour of what the index has to offer.

What is the Financial Secrecy Index?

The Financial Secrecy Index is a ranking of countries most complicit in helping individuals to hide their finances from the rule of law. The index evaluates how much wiggle room for financial secrecy a country’s laws and regulations provide – this is the country’s ‘Secrecy Score’. The index also monitors how much in financial services the country provides to other countries’ residents – this is the country’s ‘Global Scale Weight’.

These two factors are then combined to determine how big of a role the country plays in enabling financial secrecy globally – this is the country’s ‘FSI value’ and is what the country is ranked on.

How academics are using the index to make fascinating findings

The Financial Secrecy Index’ evidence-based country analyses provide valuable insights in individual countries’ contribution to global financial secrecy risk or in their country’s exposure to such risk generated by other countries.

Researchers have used the index to identify the ways in which financial secrecy via offshore jurisdictions has managed to insert itself into everyday life or has influenced history, and have used the index as a tool to help assess other transparency measures.

Here are some fascinating, recent examples of ‘applied Financial Secrecy Index research’:

The financial secrecy of immovable property investors in Liverpool.

A study by Rex, Atkinson and Ignianni (2024) examines the offshore investment strategies in immovable property located in and around the city of Liverpool. Historically, the area was deprived but in recent decades, tremendous economic progress was created through state-sponsored city rejuvenation. This also created conditions in which immovable property can be rented out at higher rates or ‘flipped’ with higher gains than elsewhere in England. Unavoidably, this has triggered tremendous inflow of offshore money into the area. The authors use public data to identify properties owned by foreign legal entities. At a postcode level, they map the offshore investment strategies used by the property owners.

Strategies are distinguished in function of a number of factors, including the use of legal entities in jurisdictions with a high secrecy score in the 2022 Financial Secrecy Index.

According to the authors, the key message of their work is that all offshore ownership strategies identified are used to avoid or evade taxes, while generating social harm by increasing wealth inequality and weakening local purchasing power.

Financial secrecy on the football pitch.

In a recent study by Duncan and Lord (2024), the offshore ownership structures of the 20 English Premier League (EPL) football clubs are analysed. The Premier League is one of the wealthiest and most profitable sports leagues in the world and this, too, has attracted enormous financial flows from abroad.

The authors start with clubs’ legal ownership data registered with the Premier League and use the ORBIS database to map international ownership structures of the owning entity. For each club, they determine the share of ownership for which the beneficial owner cannot be identified and the number and jurisdictional location of entities and in the ownership chain. The jurisdictions involved are then checked against their secrecy score on the Financial Secrecy Index 2022.

The authors reveal that 14 out of 20 clubs in the Premier League have offshore ownership structures that involve between 1 and 9 foreign entities, nearly all of which are located in high Secrecy Score jurisdictions. The authors conclude that the unnecessarily complex and opaque ownership structures of English football clubs permit the misuse of clubs for the channelling of illicit finances.

Financial secrecy as a colonial legacy in the Caribbean.

Hakelberg, Ahrens and Crasnic (2024) study the phenomenon of financial secrecy in the Caribbean archipelago. They explain why certain Caribbean jurisdictions have higher FSI values and rank higher in the Financial Secrecy Index 2022 based on their colonial history.

The authors conclude that jurisdictions’ current financial secrecy havenry ultimately resulted from their agricultural suitability. British colonisers created agricultural plantation economies on islands with good soils and maritime trading economies on islands with bad soils. Plantation economies were believed to provide enough revenue potential for the imposition of income taxes by the colonial administration. Maritime economies did not, and hence, colonial officials did not bother to introduce income taxes.

In later times, the large groups of racialised labourers descending from enslaved Africans in plantation economies were able to achieve the introduction of responsible government earlier than in maritime economies. The maritime economies combined white supremacy with no income taxes and provided an attractive and stable destination for asset holders fleeing newly independent states. As a result, the financial sectors of maritime economies grew faster than those of planation economies and in order to continue attracting asset holders, their governments also created regulatory frameworks that are more prone to financial secrecy.

Financial secrecy curtailed by public country by country reporting.

Eberhartinger, Speitmann and Sureth-Sloane (2024) set out to test whether the public country by country reporting (CbCR) rules imposed on European banks have reduced their use of tax and regulatory havens. Tax and regulatory havens are defined as countries that figure in Hines’ (2022) list of 52 tax havens and which have a higher than median secrecy score in the Financial Secrecy Index 2022.

The authors find that public country by country reporting has caused a significant decline of up to 33% of subsidiaries in tax and regulatory havens since public country by country reporting became mandatory for European banks. The authors emphasise their results reveal that public country by country reporting leads to real effects, namely withdrawals from low-tax locations, and that banks do respond to additional disclosure requirements, which is an important insight for policy debates regarding transparency measures.

Other researchers are relying on the Financial Secrecy Index to deepen the understanding of their countries’ legal framework and performance in the field of financial transparency. Here are some recent examples.

Refangga, Arifin and Saleh (2024) rely on Indonesia’s country analysis in the Financial Secrecy Index to undertake a benchmarking study of their country’s regulations fighting tax abuse, money laundering and other financial crimes. Dluhopolskyi , Ivashuk  and Myronenko (2024) do the same for Ukraine in the context of the countries’ potential future rapprochement to the EU and other international organisations. They provide a time-series overview of Ukraine’s secrecy score in the Financial Secrecy Index and of the country’s position in other international databases and indices to find that Ukraine’s performance in anti-corruption is improving year after year. Meirelles Monteiro (2024) analyses the situation of Portugal in light of the country’s ranking in the index, exploring Portugal’s underperformance on a number of indicators like ‘transparency of company accounts’ and ‘country-by-country reporting’.

How leading indices and databases use the index

Given the Financial Secrecy Index’ status as a reliable and comprehensive data collection on countries’ contribution to global financial secrecy, other institutions have not shied away from incorporating its evaluations or underlying data into their own indices or databases.

They do so either by incorporating a selection of the index’s indicators or by using countries’ ‘FSI Value’ in a component on financial secrecy in their own composite index.

Here are four recent examples of use of the Financial Secrecy Index in third party indices and databases:

• The Basel Anti-Money Laundering Index (2024) is an index developed by the Basel Institute of Governance that measures the risk of money laundering and related financial crimes in 164 countries and jurisdictions around the world. It uses a composite methodology, with 17 indicators in five domains like ‘quality of the anti-money laundering framework’, ‘corruption and fraud risks’, ‘financial transparency and standards’ and ‘political and legal risks’. Country data on ‘financial transparency and standards’ counts for 15% of a countries’ final score in the Basel AML Index and this data is fully based on countries’ Secrecy Scores from the Financial Secrecy Index. Other data is derived from institutions like the Financial Action Task Force (FATF), the US State Department, the World Bank.

• The Regulation of Illicit Financial Flows (RIFF) Dataset (2024) is a dataset developed by the University of Sussex. Its purpose is to assess the global effectiveness of international efforts to combat illicit financial flows (IFFs) and it does so by mapping how and when specific reforms to tackle illicit financial flows have been implemented in key jurisdictions around the world over the past decades. The RIFF dataset provides data on 70 jurisdictions for the period of 1990 to 2020 and comprises 23 indicators. The principal source of information for about a quarter of the indicators is the Tax Justice Network’s Financial Secrecy Index 2022.

• The Commitment to Development Index (CDI) (2023) has been created and maintained by the Center for Global Development since 2018. The CDI ranks 40 of the world’s most powerful countries based on how their policies support or inhibit development in the Global South. It creates the ranking based on eight sets of indicators that measure the effectiveness of a country’s rules regarding development finance, investment, migration, trade, environment, health, security and technology. The data from eight indicators on the Financial Secrecy Index 2022 is used in the CDI component on investment policy.

• The Governance Risk Assessment System (GRAS) (2023) is a tool developed by the World Bank to improve the detection of risks of fraud, corruption and collusion in government contracting. GRAS is based on four groups of ‘red flags’ on procurement cycle, collusion, political connections and supplier characteristics. Two of the red flags under ‘supplier characteristics’ are the registration of the supplier company and/or its shareholders in a ‘tax haven’. Whether the country of registration is considered a ‘tax haven’ is based on its jurisdiction’s ‘FSI value’ and ranking on the Tax Justice Network’s Financial Secrecy Index.

How banks, businesses and investors are using the index for anti-money laundering and sustainability

In a global economy rife with financial secrecy and illicit flows, credible data is a frontline defence. The Tax Justice Network’s Data Portal provides direct access to the Financial Secrecy Index’s underly data — a vital resource for institutions committed to integrity, transparency, and regulatory compliance. The Data Portal is a one-stop-shop for data on countries’ regulations on tax and financial transparency consolidating data from the Tax Justice Network’s own research (predominantly, from the Financial Secrecy Index and Corporate Tax Haven Index, State of Tax Justice and the Policy Tracker) facilitating access to core indicators that assess systemic vulnerability to financial secrecy and tax abuse. It also includes data from international bodies, expert sources, and estimates from academic papers.

The data is free for non-commercial use, but commercial applications require licensing — a step already taken by major players across banking, fintech, sustainable investment, and compliance technology. Based on feedback from current licensees, we know the Tax Justice Network data is being used for the following purposes.

For anti-money laundering and compliance professionals, index data delivers essential insights. It enables country risk classification, strengthens Know You Customer (KYC) and Enhanced Due Diligence (EDD) procedures, and feeds directly into Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) risk models. Institutions also rely on it for tax evasion risk flagging, and for creating automated geographic risk scoring systems.

Usage among major financial actors is well established. At least eight of the world’s 100 largest banks, including 3 in the top 20, have a license to use Financial Secrecy Index data for compliance monitoring, internal risk scoring, and regulatory reporting. Global credit rating agencies, payment processors, and consulting firms use it to assess jurisdictional AML/CFT exposure. Leading ethical banks and internet banking platforms also leverage it to evaluate country and customer-level risk.

In the sustainable business sector, the Financial Secrecy Index supports supply chain risk management and due diligence. Companies use the data to build country profiles and evaluate supplier and business partner risks.

On the investment side, the Financial Secrecy Index supports Environmental, Social and Governance (ESG) screening by helping fund managers exclude companies domiciled in or exposed to high-secrecy jurisdictions. Its insights are integrated into sovereign ESG ratings, governance indicators, and risk-based exclusion criteria, ensuring investors meet both regulatory standards and ethical mandates.

The Financial Secrecy Index s also embedded in risk technology platforms, feeding into Software as a Service (SaaS) tools for compliance automation, jurisdictional risk dashboards, and client due diligence systems. A recently published working paper discusses potential applications and models with the Financial Secrecy Index data in the context of the criminological and computer science literature. In short, the data has become instrumental to how risk-aware institutions operate.

In an era of global regulatory fragmentation and pervasive financial opacity, the Financial Secrecy Index provides a vital edge. It equips anti-money laundering experts, sustainable businesses, and financial institutions with the intelligence needed to expose hidden risks and build systems that don’t just comply—but push for change.

Conclusion

As global standards on transparency struggle to keep pace with financial innovation and secrecy, the Financial Secrecy Index stands out as a critical countermeasure. It offers not only a rigorous and independent assessment of jurisdictions’ contributions to global financial secrecy, but also a growing ecosystem of applications—from public-interest research and policy monitoring to the risk frameworks of financial institutions, sustainability actors, and regulators.

Beginning in 2025, the Financial Secrecy Index transitioned to a rolling update system, allowing for continuous responsiveness to regulatory changes. This dynamic cycle—more agile than many Financial Action Task Force (FATF) evaluations—ensures that reforms flagged in annual government consultations are verified, integrated, and made available within months, not years. The result is a risk assessment tool that is consistent, transparent, and responsive—essential qualities for institutions navigating volatile regulatory environments and evolving compliance obligations.

Financial Secrecy Index data is available free of charge for non-commercial public use, supporting the vital work of civil society, investigative journalism and open academic research. At the same time, licensed access for commercial users strengthens the long-term sustainability of the index, while contributing to the production of high quality, comparative legal and regulatory data for the public good. Harnessing detail and nuance, the Financial Secrecy Index contributes to a global infrastructure for accountability.