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The Deterrence Effect of Whistleblowing: An Event Study of Leaked Customer Information from Banks in Tax Havens

Niels Johannesen and Tim Stolper

No 6784, CESifo Working Paper Series from CESifo Group Munich

Abstract: We document that the first leak of customer information from a tax haven bank caused a sudden flight of deposits from tax havens and a sharp decrease in the market value of banks known to be assisting with tax evasion. The loss of market value was largest for the banks most strongly involved in tax evasion and zero for banks with no known ties to tax evasion. Subsequent leaks had qualitatively similar although smaller effects. Our findings suggest that whistleblowing in tax haven banks deters offshore tax evaders by increasing the perceived risk of committing and assisting with tax evasion.

Keywords: whistleblowing; economic crime; tax evasion; tax havens (search for similar items in EconPapers)
JEL-codes: G21 H26 K42 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-iue, nep-law and nep-pbe
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

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