Dec 14, 2009 – The man who isn’t there: whatever happened to Paul Volcker?
President Obama appointed him Chairman of the new Economic Recovery Advisory Board which is supposed to advise the president on jump-starting the economy and stabilizing financial markets. But the former Federal Reserve Chairman has been cut out of key discussions, including one taking place today with officials of a dozen big banks.
December 14, 2009 | Posted in Blog
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Inter Press Service (IPS), Nov 14, 2009 – To end poverty, you have to know how it began – with globalisation. No, not the 20th century variety engendered by multinationals and their friends at the IMF, World Bank and WTO. They just codified practices that kept developing countries poor.
French filmmaker Philippe Diaz, in an illuminating documentary opening in New York Friday, traces globalisation back 500 years to the Spanish and Portuguese conquests of the Americas. Diaz shows how the colonial North used the South’s resources to build its industrial base and how its continued control over resources, global trade and debt rules prevents developing countries from ending poverty.
November 14, 2009 | Posted in Blog
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Nov 8, 2009 – The 20th anniversary of the fall of the Berlin Wall has called forth a plethora of memories and celebrations. Here are mine.
I visited West Germany in 1983 as it held massive demonstrations against the U.S. plan to station medium range missiles on German territory. The peace movement – objecting to the Ronald Reagan hard line against the East — had another view of how to bring down communism from within. The German government “Ostpolitik” – East politics – though denounced by the Reagan politicians, was ultimately successful.
November 8, 2009 | Posted in Blog
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Oct 17, 2009 – When he was interviewed for the investigative story I did in March on Sodexo’s practice of demanding rebates (ie kickbacks) from suppliers, Sodexo deputy counsel Tom Morse argued that working only with “compliant” vendors was necessary to assure health and safety. (“Compliant” means they pay rebates.”)
He said that “the first thing we vet our vendors for is safety” against food-borne illnesses …”
October 17, 2009 | Posted in Blog
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Aug 3, 2009 –
In January 1986, I went to the Philippines to chronicle the growing movement against the Ferdinand Marcos dictatorship. I was there for the “people power revolution,” a non-violent massive street protest that in February finally drove Marcos from power. I remember being outside the presidential palace that night and racing through the streets when gunfire erupted. The U.S., which had supported him for decades, flew him and his wife Imelda to Honolulu. Along with documents that detailed how they had looted the country and where the money was.
August 3, 2009 | Posted in Blog
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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
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.)
March 17, 2009 | Posted in Blog
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Feb 11, 2009 –
The U.S. government might finally get a powerful tool against offshore tax evasion by mega-wealthy individuals and corporations. The worst most miscreants face now is negotiated pay-ups years after they are caught.
A bill introduced last week by Senators Patrick Leahy (D-Vermont) and Chuck Grassley (R-Iowa) would make tax evasion using international transfers a criminal money-laundering offense.
The law aims at cases in which money passes through tax havens. It targets not just the evaded taxes, but any money that is part of the scam.
Feb 8, 2009 –
At a time when New York State’s budget is reeling from Wall Street tax losses — Wall Street pays 20 to 30 percent of revenues — you’d think Governor David Paterson would want to recoup all the evaded taxes he could get. That doesn’t seem to be the case when it comes to corporations that launder their profits offshore.
Paterson refused to deal with the issue and instead answered a question I hadn’t asked. I wonder why. Does that mean he won’t go after corporate tax evaders? Here is the exchange from the Council’s transcript of David Patterson meeting.
Sept 2, 2008 –
Michael Glassner, in charge of Republican Vice-Presidential candidate Sarah Palin’s campaign operations, was till April 18th a vice-president of IDT, the New Jersey-based telecom fined $1.3 million by the FCC in July for failing to file its Haiti contract.
The contract, effective in 2004, revealed payments to an offshore shell company in the Turks & Caicos which sent only part of the fees to Haiti’s phone company. The case is under investigation by the Justice Department and the Securities and Exchange Commission. A former IDT insider, Michael Jewett, who managed the company’s Caribbean region, says the missing money represented kickbacks to former Haiti President Jean-Bertrand Aristide.
June 18, 2008 –
I never thought I’d hear those words, certainly not at the Council on Foreign Relations. Gov. Bill Richardson of New Mexico spoke at a Council lunch today. The subject was immigration. Before the talk, several people, including this reporter, stopped at the speaker’s table to chat. I was standing there when Maurice Tempelsman approached Richardson. The Governor greeted him and said, “Where’s Mobutu!”
Well, that was a conversation stopper! Tempelsman, a very very rich man, and a generous donor, frequently gets a place of honor at the Council head table, though not today. Nobody raises the question of how he got his money.
March 26, 2008 –
Lawrence Summers spoke at the Council on Foreign Relations last week and was a bit uncomfortable about my question regarding Clinton administration anti-money-laundering policy.
I pointed out that Treasury Secretary Robert Rubin (who happens to be one of the Council’s co-chairs) had not acted against money-laundering because he didn’t want to stop the free flow of cash into the US – in effect, into Wall Street. But when Summers succeeded Rubin in the job, he had taken action.
The facts are important because Rubin is poised to move into a Democratic administration — especially if Clinton wins — as a high-level Wall Street influential.
March 10, 2008
It’s not just about buying or selling sex. It’s also about money laundering. New York Governor Eliot Spitzer’s downfall began with an investigation by the Internal Revenue Service. That’s because when people move money for illicit purposes, they try to disguise the flows. And US banks are required to report suspicious transfers to the Treasury Department.
The IRS gets involved, because those transfers could be effected to hide income from taxes. So it responded to bank reports of suspicious transfers by Spitzer, who was paying thousands of dollars for call girl services. The money was being sent to QAT consulting, a shell company owned by the Emperor’s Club V.I.P. prostitution ring.
Then the FBI joined the United States Internal Revenue Service-Criminal Investigative Division, looking into what appeared to be at first possible government corruption but then turned out to be payments to an organization running prostitution. And also laundering money in the United States and Europe.
March 10, 2008 | Posted in Blog
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Dec 13, 2007
I chatted for a few minutes with Italian President Giorgio Napolitano after he spoke this morning at a Council on Foreign Relations breakfast. He agreed that there is a problem posed by offshore financial centers and pointed to concern in Europe reflected in a recent joint letter on the subject by the UK, France and Germany.
Napolitano is an extraordinary man who served nearly 40 years in the Italian parliament and was a leader of the Italian Communist Party, the PCI, helping to move it out of the Stalinist camp to social democracy.
Richard Gardner, US ambassador to Italy 1977 to 81, who presided over the meeting, told me that he had tried to persuade Henry Kissinger that Napolitano was a social democrat. Gardner said that Kissinger never could grasp that.
December 13, 2007 | Posted in Blog
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Dec 1, 2007
When there’s a financial crisis tied to lack of transparency, follow the culprits offshore. Evidence comes out now that this is true about the subprime debacle.
Reuters reports that a German bank is implementing “accounting changes including consolidation of an offshore conduit whose soured investments triggered a government-led rescue.” The offshore operation was set up to invest in subprime mortgages.
Pam Martens in Counterpunch points out that, “Citigroup, is discovered to have stashed away over $80 billion of Byzantine securities off its balance sheet in secretive Cayman Islands vehicles with an impenetrable curtain around them.”
Among those securities count subprimes. Citigroup has $55 billion of subprime exposure and in November said it would write down up to $11 billion in subprime losses. Goldman Sachs said that won’t be all, that the bank may have to write off $15 billion.
Nov 3, 2007
Learning of General Pervez Musharraf’s declaration of emergency rule (martial law) in Pakistan, I can’t help but recall the gushing introduction of the general made by Citigroup honcho and Democratic financial eminence grise Robert Rubin when the dictator, who came to power in a military coup, spoke at the Sept 25, 2006 meeting of the Council on Foreign Relations.
Rubin urged the audience to “understand a great deal more than those in our country tend to know about Pakistan, the Muslim world, the meaning of democracy in the context of countries very different from our own.”
Rubin’s obsequious comments might be connected to the fact that Musharraf had appointed a top Citigroup official to be his finance minister, giving the bank privileged entrée into the country.
A question now for Robert Rubin: Just how do you fit martial law into your expansive meaning of democracy?
November 3, 2007 | Posted in Blog
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Oct 23, 2007 – In the continuing saga of the Frigates of Taiwan, involving about $1 billion in bribes and kickbacks paid by the French company Thomson to win a bid on the sale of six war frigates to Taiwan in the early 90s, I asked French Finance Minister Christine Lagarde, at the Council on Foreign Relations yesterday, if she would continue the cover-up on a corruption case that could be the largest (known) in French history.
Madame Lagarde wasn’t “sufficiently aware” of the case that has been exhaustively reported by French print and broadcast media for more than a decade.
Sept 29, 2007
It’s that time of the year when the UN General Assembly opens and heads of state and foreign ministers meet up at parties and quiet gatherings and even give a few public speeches around town. A popular stop is the Council on Foreign Relations, where anyone representing an establishment view is assured of a warm welcome.
French Foreign Minister Bernard Kouchner, famous as the founder of Médecins Sans Frontières (actually he was one of 12 doctor and journalist founders), spoke at the Council on Tuesday. In his introduction Felix Rohatyn, the prominent investment banker, US ambassador to France in 1997-2000 and now an advisor to the chairman of Lehman Brothers, said, “There are very few people who act according to their principles. Bernard Kouchner acts on his principles, and that’s a very rare virtue, especially in a politician.”
I was hopeful that Minister Kouchner, a Socialist who has joined a conservative government, would display these principles in his answer to my question about a corruption scandal that could be the French Watergate. However, the minister displayed the not-so-rare political attribute of solidarity with high-level officials who want to suppress evidence of corruption.
Sept 17, 2007
There’s an astonishing article in the Washington Post’s Business Section (“Risk. Now They See It. Now You Don’t.“ Sept 16, 2007)
The Post, which has never, ever, railed against tax havens, is now suggesting that their use to cheat tax authorities and investors threatens the entire global financial system. Of course, it doesn’t put it so starkly, but that’s the gist.
The Post says, “Over the past few years, major banks figured out how to use “conduits” and “structured investment vehicles” to earn big fees while playing cute little games of tax and regulatory arbitrage and keeping it all pretty much hidden from investors.”
Where does The Post think those off-balance-sheet investment vehicles are? Most of Enron’s were in Grand Cayman. The Post should connect the dots. Tax and regulatory arbitrage plus hidden plus off-balance-sheet investment vehicles = offshore.
Why did regulators tolerate the use of offshore? Because global tax evasion and avoidance of regulation is something corporations want. That’s what offshore secrecy is for. Now, will Congress act, in spite of corporate power, when there is a threat to the entire global financial system?
September 17, 2007 | Posted in Blog
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Aug 1, 2007
Where did Rupert Murdoch get $5 billion to buy up the Wall St. Journal? Beyond normal profits, his coffers were stuffed by dodging taxes in the U.S. and elsewhere. Some of that is your money!
The Economist, in 1999, investigated Murdoch’s corporate tax affairs and discovered that a collection of 800 offshore companies help him cut corporate taxes to 6%!
May 16, 2007
Paul Hewson, known as Bono, the rock star, is complaining that the seven wealthy nations in the G-7 which had promised to double aid to the developing world by 2010, are more than half behind target. The countries are the United States, Britain, Canada, France, Germany, Italy, and Japan.
Bono’s protest might be taken more seriously if he and his U2 band were not participating in the system that deprives developing countries of far more than western aid – much of which has to be repaid.
Bono is a tax dodger. As a result of a change in Irish law that limits the tax exemption for artists and musicians to a “punitive” $625,450, Bono’s U2 has moved its music publishing company registration to the Netherlands, where the tax on its multi-million dollar income will be about 5 percent. To dodge taxes on non-royalty income, Bono’s company has used offshore nominees.
May 16, 2007 | Posted in Blog
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April 10, 2007 –
The NY Times reports today that Charles Prince, CEO of Citigroup, is planning to cut the corporation’s compliance staff. Reporter Eric Dash says it’s “to keep the bank from getting bogged down” because “the compliance overhang has made it difficult to be competitive” and “unnecessarily slowed the company down.”
Translation: other banks are laundering profits or running scams to help clients cheat tax authorities and investors, and they make good money at it. Why shouldn’t we?
Dash noted that Citigroup had beefed up its compliance staff after scandals, including its “dealings” with Enron. He skimps on details: that Citigroup set up offshore shell companies to help Enron cook the books.
March 28, 2007
Russia, through its energy company Rosneft, has started to recover the multibillion-dollar oil company Yukos that was stolen from it in the mid-90s. It is buying the assets in auctions. Indignant protests are heard from westerners.
Funny there was no indignation from western officials when Mikhail Khodorkovsky and other “oligarchs,” with the help of crooked President Boris Yeltsin, were appropriating Russian national oil and mineral wealth for kopeks on the ruble.
A Khodorkovsky company ran an auction at which a Khodorkovsky shell company “won” Yukos, paying $309 million for a controlling 78 percent. Months later, Yukos traded on the Russian stock exchange at a market capitalization of $6 billion.
March 25, 2007
Swiss travel the world to help mega-rich evade taxes
The NY Times headline yesterday said, “Discreet Swiss Banks Now Offering Sophisticated Investment Vehicles.” Further down, the story noted that Geneva has becomes an “aggressive haven for the global elite.” And, “Now the Swiss can be found throughout the world, selling more sophisticated investment vehicles to attract high-net-worth individuals, mostly multimillionaires.”
So what is the real story about? The headline should have been, “Discreet Swiss travel the world to help the mega-rich evade taxes.”
How else has bank-secrecy Switzerland, with only 7.5 million people, become the third-largest asset manager in the world, after the United States and Britain, with global banking assets under management of $5.5 trillion?
March 2, 2007
A UK photographer just sent The Scoop this email about The Photographers Gallery in London. He says:
“The Deutsche Borse photography prize, formerly the Citibank photography prize, is perhaps the most prestigious and important photography prize and one of the most important art prizes. Those who win become “name” photographers/artists, and their work becomes literally over night very valuable, exchanging hands for many thousands of dollars.
March 2, 2007 | Posted in Blog
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Lucy Komisar covered the women’s convention in Houston and wrote about it for The Nation, December 10, 1977. (text version is below) WITH THE WOMEN AT HOUSTON: FEMINISM AS NATIONAL POLITICS LUCY KOMISAR The blue and green bunting, the state delegation signs, the three-cornered hats that said “Free D.C.,” the [...]
December 10, 1977 | Posted in Blog
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