Q&A: Tax Havens, Bank Secrecy, and Tricks

Inter Press Service (IPS), July 14, 2009 – At a recent conference in Miami organised by Offshore Alert, a specialised media organisation focused on financial crime, IPS sat down with veteran investigator Bob Roach to discuss the hurdles facing regulators trying to crack down on tax havens, which cost the U.S. alone an estimated 100 billion dollars annually.

Exclusive: Florida banking agency helped Stanford set up unregulated office to sell his phony CDs

<em>Exclusive</em>: Florida banking agency helped Stanford set up unregulated office to sell his phony CDs

State aided suspect in huge swindle

Miami Herald, July 5, 2009 –

Winner of second place for Business News, the National Headliner Awards

Years before his banking empire was shut down in a massive fraud case, Allen Stanford swept into Florida with a bold plan: entice Latin Americans to pour millions into his ventures — in secrecy.

From a bayfront office in Miami in 1998, he planned to sell investments to customers and send their money to Antigua.

But to pull it off, he needed unprecedented help from an unlikely ally: The state of Florida would have to grant him the right to move vast amounts of money offshore — without reporting a penny to regulators. He got it.

“Pure Confidence” traces a slave jockey to “freedom” in Saratoga, New York

Simon Cato (Gavin Lawrence) in his gold and purple stripes is cheeky, witty, a charmer as a jockey. Step back. This is 1861 and he is black; cheeky translates to “impudent,” (a challenge to power). A “witty” black man probably had no translation. Colonel Wiley Johnson (Chris Mulkey), who has hired Simon to ride his racing horse, pleads, “Will you try and behave like a slave for just a few minutes!”

“Joe Turner’s Come and Gone” a poetic, surreal, tragic vignette of blacks coping with vestiges of slavery

August Wilson’s powerful, moving play conjures up a mood that is both poetic and surreal, though on the face of it, it is completely naturalistic. Perhaps it’s the distance of time, nearly a century ago, 1911, when blacks, only 50 years away from the start of the Civil War, were living on the border between slavery and freedom. Or it could be the ethereal staging by director Bartlett Sher, who excellently follows Wilson’s intent to turn the characters into symbols of their kind as well as real people. Sher starts that by showing the characters first in silhouette.

OECD Tax Havens Deal Falls Short, Critics Say

Inter Press Service (IPS), May 8, 2009
– Jeffrey Owens, the tax “point person” of the Organisation for Economic Cooperation and Development (OECD), was stung by activist critics of the OECD standards under which countries will be put on a tax haven blacklist and targeted for sanctions.
The blacklist was announced last month at the London meeting of the G20, which said in a communiqué that it would “take action against non-cooperative jurisdictions, including tax havens…to deploy sanctions to protect our public finances and financial systems.”

Key civil society criticisms are that the OECD standards require bilateral agreements for information on request, not automatic multilateral tax information exchange; that they call for only 12 such agreements to be signed by each tax haven; and that getting off the blacklist entails only promises, which have not been kept by tax havens in the past.

IRS on the Track of Tax-Cheating “John Does”

Inter Press Service (IPS), April 30, 2009 – The U.S. Internal Revenue Service (IRS) is hitting pay dirt with a novel legal tactic designed to catch tax evaders. And it’s going to use it to force international banks to give up the names of tax cheats. It’s called the “John Doe” summons. Using “John Doe” means the IRS doesn’t know the names of the suspected tax evaders. So it sends a summons to a bank or credit card company that says, “Give us the names and account information of all your U.S. clients with secret offshore accounts.” Daniel Reeves, an IRS agent in charge of the tax agency’s offshore compliance initiative, afforded an unusual look into the broad swath of projects that seek tax-cheating “John Doe’s” every place from accounts of the giant Swiss bank UBS to the records of Pay Pal.

“Kooza” is grace and fantasy for adults, as well as thrills for kids

I have never seen anything like the three acrobatic contortionists who twisted and bent to the sound of Indian music under the Cirque de Soleil tent on Randall’s Island. Their movements created living sculptures that shifted and held and then moved to another pose. Clad in colorful, patterned skin-tight leotards (costumes by Marie-Chantale Vaillancourt), they were stunning. Memorable.

“33 Variations” goes back to Beethoven to examine the creative mind

What moves the creative and intellectual mind? Where does beauty lie? Those questions animate “33 Variations,” the provocative play written and directed by Moisés Kaufman and starring Jane Fonda. The production doesn’t quite reach the level of intellectual stimulation to which it aspires, but it deserves plaudits for dealing with ideas as well as sentiments.

“Why Torture is Wrong, and the people who love them” – a satire for our time

How can you satirize torture and torturers? If you’re comically stinging playwright Christopher Durang, you stick pretty close to the truth till weirdness and absurdity overtakes the brutality. In this brilliantly funny play, Durang blunts the edge of what might appear to be gruesomely violent by turning reality into farce. He gets a lot of help from director Nicholas Martin who transforms right-wing psychopaths into figures of comedy.

“Happiness” is a fleeting moment in this mixed musical pastiche

Stanley (Hunter Foster) was an investment banker, a master of leveraged buyouts. As Foster tells it in song and dance, he was an “overachiever of insider trading,” moving “a step up the ladder of legalized crime.” Then, at 42, he had a massive heart attack. And died.

Now he’s the conductor on the train in this whimsical pastiche by John Weidman (often clever lyrics by Michael Korie, tuneful music by Scott Frankel) about people on the way to the netherworld – via a New York subway car with silvery benches — instructed to remember the best moments of their lives. It’s where they will spend eternity.

“The Toxic Avenger” a hilarious musical satire of corrupt NJ mayor and environmental activist

Take an environmentalist attacked by thug hired by a corrupt New Jersey mayor and thrown into a vat of that state’s famous pollutants so that he comes out dripping with green sludge. Add a blind librarian who, when she return books to the shelf, lets go in mid-air so that they fall to the floor. She also writes porn, samples of which we hear. Nothing’s better than a clever political satire, and “The Toxic Avenger” is the funniest I have seen in many a year.

“Chasing Manet” – wanting “out” to recapture a past life

Tina Howe’s bittersweet look at a tough, smart, legally blind and aging painter railing at the indignities of being warehoused in a Riverdale nursing home is sensitive and often funny. Jane Alexander shines as the painter, Catherine Sargent, who feels suffocated, blocked from her past life and surrounded by people who’ve gone senile.

Above her bed is a print of “Le déjeuner sur l’herbe,” the Édouard Manet painting of a nude women having a picnic with two fully clothed men. Sargent explains to the family of her new roommate, the spirited but slightly dotty Rennie Waltzer (Lynn Cohen), that putting a naked woman in public place in 1863 sounded a call for artistic freedom and paved the way for modern art.

“An Oresteia” – juicy tales of adultery, murder, and revenge

The Classic Stage Company’s bold mounting of three Greek playwrights’ visions of one of the most famous ancient myths lurches from melodrama to vaudeville and gives audiences some diverting hours in the modern theater.

Three directors have taken on the task, Brian Kulick and Gisela Cardenas staging “Agamemnon” and “Elekra” and Paul Lazar helming “Orestes.” The contemporary translation and adaptation is by Anne Carson. A mostly expert cast moves through the dramas, with special praise deserved by Stephanie Roth Haberle for an in-your-face Klytaimestra, Steve Mellor as the to-the-manor born Agamemnon and then his brother Menelaos, and an astonishing Annika Boras as Elektra, who asserts a daughter’s revenge with studied passion.

Tax Havens in Spotlight at G20 Meet

Inter Press Service (IPS), March 29, 2009 –

This could be the moment when a fatal blow is delivered to the world’s tax havens. Or it could be another largely cosmetic change that allows offshore financial centres such as Switzerland, the Cayman Islands and Liechtenstein to deflect attacks on the system by sacrificing the few tax miscreants that governments catch in their nets.

Decisions at the G20 government leaders meeting in London Apr. 2 will set the direction.

Offshore centres, worried what may happen in London, are falling all over themselves promising to cooperate with the major powers on the trail of tax cheats. But the holes in the tax havens’ promises are as big as those in Switzerland’s famous cheese.

Many believe that automatic exchange of information is the only really effective way to end pandemic tax evasion. Some very good proposals are made in a leaked French paper which is linked to the full story.

The Real AIG Scandal: How the Game is Rigged at Wall Street’s Casino

AlterNet, March 26, 2009 –

Congress has deftly avoided the real story of AIG’s collapse, which will make a few million in bonuses seem like peanuts.

Most legislators at a House Finance subcommittee hearing last week deftly avoided the real story of AIG’s collapse. Instead, they homed in on the public relations disaster of hundreds of top AIG officials and staff getting $165 million (later revealed as over $218 million) in bonuses.

The key issue ignored by the congressmen and women was the potential catastrophe represented by as much as $2.7 trillion in AIG derivative contracts and how AIG and the U.S. government are dealing with them. To put that number in context, we’ve so far provided the company only about $170 billion.

Incident at Vichy” is Miller’s chilling morality play about the Holocaust

A central theme of Arthur Miller’s plays is morality, often personal morality in difficult times. “All My Sons,” produced in 1947, excoriated a man who sold faulty aviation equipment to the military during the war. “The Crucible,” staged in 1953, was his Salem witch trials commentary on McCarthyism. And a decade later, Miller was back to the theme with “Incident at Vichy,” a 1964 chilling and depressing look into peoples’ psyches and morality in the time of the Holocaust. In each succeeding play, the times got tougher, moral choices more difficult.

The mysterious Bank Madoff

March 17, 2009 –

There’s a mysterious “Bank Madoff, New York” that U.S. authorities don’t appear to know about. International securities clearing houses move trillions of dollars a year for banks and brokerages and are a natural way for crooks to launder Bank Madoff listing on Clearstream roster
and hide ill-gotten gains. So it would be natural for investigators to check the paper trails of Madoff accounts in CSDs (central securities depositories) around the world.

They already know about the one listed in the name of “Bernard L. Madoff Investment Securities LLC New York, US broker/dealer.”

But they don’t seem to know about “Bank Madoff, New York.” It appears on a list published by Clearstream, the international clearing and settlement house in Luxembourg. That “bank” has not been publicly mentioned by investigators.

(See the listing on its full page.)

“Heroes” – three French WWI veterans imagine their lives

Three men at a French home for World War I veterans are a wistful, sad lot living in a boring present and (some of them) fearing or hoping for a fanciful future. A little imagination goes a long way. Gérald Sibieyras’ play, translated from the French by Tom Stoppard, has a slight plot but meaty characterizations by the excellent cast of this Keen Company production. Director Carl Foreman succeeds in warding off excessive sentimentality.

“Guys and Dolls” revival is a good bet when they’re singing

The score carries this sprightly if not perfect production of the classic 1950 musical comedy about a Salvation Army missionary who reforms a couple of hard-boiled but appealing gamblers. The book by Jo Swerling & Abe Burrows was based on “The Idyll of Miss Sarah Brown” and “Blood Pressure,” two short stories by Damon Runyon, who gets stage credit via the opening scene of a writer typing “Broadway Stories” on an old Remington.

Sarah Brown, the engaging Kate Jennings Grant, is out to save some souls. Nathan Detroit (Oliver Platt) is committed to finding a place to run his floating crap game for the night. “This is a show where a lot of joy washes over the audience in spite of the fact that the songs are over-miked and the talk scenes between the numbers don’t sparkle as much.

Cafeteria Kickbacks

How food-service providers like Sodexo bilk millions from taxpayers and customers

In These Times, March 2009 –

The Investigative Fund at the Nation Institute provided generous support for this article.

At the end of the 2006 school year, children’s nutrition advocate Dorothy Brayley had a disturbing conversation with a local dairy representative. He had come to her office to discuss participation in the summer trade show of food providers she runs as director of Kids First Rhode Island.

At the time, the state’s schools were buying 100,000 containers of milk each week. The salesman for Garelick Farms, New England’s largest dairy, told Brayley that Sodexo—a food and facility management corporation that managed most of the state’s school lunch programs—was paying Garelick more than competitors in order to get a bigger rebate.

That’s just a taste of the hundreds of millions of dollars of “rebates”—or kickbacks from suppliers—that Sodexo, a $20 billion-a-year global leader in the food and facility management industry, has taken while operating cafeterias and other facilities for schools, hospitals, universities, government agencies, the military and private companies across the country, according to evidence provided by whistleblowers and internal company documents.