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Archive for the Category ‘offshore’

Institute for Advanced Studies in Princeton bans Lucy Komisar from Wm Browder speech

Institute for Advanced Studies in Princeton bans Lucy Komisar from Wm Browder speech

Dec 2, 2016 – Today, the Institute for Advanced Studies in Princeton banned me from attending a talk by William Browder, a controversial American-born investor whose undocumented stories about the theft of several of his Russian companies and the death of his accountant have led to a ban in the U.S. (2012) against people he has accused — again without proven evidence — of human rights abuses and the theft of those companies. The result has been to damage relations between Russia and the U.S.

Ban offshore banks with account secrecy from US correspondent accounts: Nobel laureate Joseph Stiglitz

Ban offshore banks with account secrecy from US correspondent accounts: Nobel laureate Joseph Stiglitz

June 3, 2016 – Joseph Stiglitz, Nobel prize-winning former chief economist of the World Bank, says that the way to solve corruption and money-laundering facilitated by offshore banks that run secret accounts is to “shut them down.” And the way to do that is to ban non-transparent banks from US correspondent accounts. He spoke at a Council on Foreign Relations meeting today.
At the breakfast on “Is U.S. Finance Hurting Growth?”, he addressed an aspect of banking that was not on the agenda, asking, “Why do we have offshore banking? You know, is it that finance really does better in the Cayman Islands because of the sunshine? (Laughter.) You know, that makes money grow faster.”

Tax Evasion Nation: Will the US Be Branded a Tax Haven?

Tax Evasion Nation: Will the US Be Branded a Tax Haven?

The American Interest – May 26, 2016

It will indeed, unless something changes, according to a member of a European Union delegation to the United States investigating shell companies.

An international agency could label the United States a tax haven as the result of America’s refusal to require the names of beneficial owners of companies registered in the U.S. So said European MP Eva Joly, a member of the European parliamentary delegation to the U.S. that met last week with government officials and Congressmen on the issue of America’s clandestine shell companies.

Joly, of the French Greens, told The American Interest, “We have international standards for beneficial owners, and what [the U.S. has] is not up to that.” She said the FATF (Financial Action Task Force) audited U.S. practices in January-February and predicted that the standards would be found lacking when the FATF releases its report in October.

Tax Evasion Nation: Ending Tax Haven Abuse (what Obama gets wrong)

Tax Evasion Nation: Ending Tax Haven Abuse (what Obama gets wrong)

The American Interest, May 12, 2016 –

Solving the offshore money-laundering and tax evasion system is easy, but the Obama Administration’s proposal isn’t the way to do it.

Stung by the Panama Papers revelations of worldwide tax evasion by the rich and powerful, President Obama has seized the moment to propose a solution guaranteed to gather headlines—and then fail. But if he wanted to, he could, through the Treasury Department, end the system of offshore tax havens with a stroke of the pen.

First, let’s look at the solution and, then, at what’s wrong with the President’s proposal.

The Obama proposal acknowledges the threat offshoring poses to our national security. Treasury estimates that $300 billion in illicit proceeds are generated annually in the United States due to financial crimes. But it then essentially ignores the powerful weapon it can wield against that threat.

Exclusive: Yanis Varoufakis reveals how European powers’ Troika abolished Greek anti-tax evasion unit

Exclusive: Yanis Varoufakis reveals how European powers’ Troika abolished Greek anti-tax evasion unit

April 26, 2016 – A drumbeat of the Troika that ended Greek sovereignty last year was that the government wasn’t collecting taxes. The Troika was the European Commission (EC), the International Monetary Fund, and the European Central Bank. That charge came from a collection of states that includes some of the world’s worst tax evasion enablers, including the Luxembourg of EC President Jean-Claude Junker, whose country is a world class tax haven. Former Greek Finance Minister Yanis Varoufakis revealed for the first time how days after he resigned, the Troika effectively abolished a unit he had set up to combat tax evasion.

NY Review of Books reports this comment, but won’t print it

NY Review of Books reports this comment, but won’t print it

Jan 15, 2015 – Anne Applebaum wrote an article about Putin’s Russia in the Dec. 18, 2014 issue of the New York Review of Books that was filled with distortions. When I saw NYRB editor Robert Silvers at a Dissent magazine party in New York Dec. 5th, I told him my opinion. He said to send him my comments. But then he declined to print those comments and said that he would run this editorial statement:

Lucy Komisar has written to us that she has a statement to make about the article by Anne Applebaum in our December 18, 2014 issue. This statement is available on her website, The Komisar Scoop. — The Editors.

Russian Sanctions Highlight Role of Western Enablers

Russian Sanctions Highlight Role of Western Enablers

The secret deals of “corruption fighter” William Browder, an offshore profit-launderer

100Reporters, May 21, 2014 – As U.S and European governments impose sanctions on bankers, businessmen and officials close to Vladimir Putin to pressure him over Crimea, the asset freezes will lead investigators not to the Kremlin alone, but to the western-built offshore system that has helped the Russian leader and friends loot their country and consolidate power.

A case – details not public before – shows how westerners – lawyers, accountants, bankers, investors—used the offshore system to facilitate and benefit from Russian corruption.

It involves William Browder (opposite), self-described anti-corruption fighter, known in Washington for winning passage of 2012 “Magnitsky Act,” which presaged current law by blocking visas, freezing assets of Russians accused of rights violations and corruption.

Browder and fellow investors stole funds diverted via an Isle of Man shell from a Russian company they controlled.

Russian Deputy PM says 1,000 Russian banks are money-launderers

Russian Deputy PM says 1,000 Russian banks are money-launderers

April 4, 2011 –

Sergey Ivanov, the Russian deputy prime minister, spoke at a Council on Foreign Relations lunch today. I asked if he thought the U.S. and Russia should get together to put a stop to offshore tax evasion. He smiled and agreed that the two countries need to deal with the international offshore system. That was something to consider in the future. And then he said, “There are more than 1,000 banks in Russia. They are not banks but launderers.”

A Russian spook operation? “Khodorkovsky” film mysteriously stolen twice

A Russian spook operation? “Khodorkovsky” film mysteriously stolen twice

Feb 5, 2011 – The final edit of a film about the jailed Russian oligarch Mikhail Khodorkovsky, a film to which I contributed, has been stolen from the offices of German director Cyril Tuschi. The documentary, “Khodorkovsky,” is to have its world premier at the Berlin International Film Festival Feb. 14. I did reporting for the film and also was video-interviewed for it. The film tells Khodorkovsky’s story from his youth to the build-up of his oil empire and his political challenge to then President Vladimir Putin. Putin had told the “oligarchs,” men who had stolen the Russian patrimony to build their wealth, that he wouldn’t bother them as long as they stayed out of politics. Khodorkovsky, however, sought to influence the Duma election. He was arrested in 2003 and then tried and jailed for tax evasion.

Ex-employee who claimed firing over opposition to Haiti bribery settles suit against IDT

Ex-employee who claimed firing over opposition to Haiti bribery settles suit against IDT

Jan 24, 2011 – The lawsuit filed by a former employee against the Newark-based global telecom IDT is over. J. Michael Jewett, who was an IDT executive, claimed in 2004 that he was fired for opposing bribes to Haitian officials. Lawyers for both sides agreed to drop the complaint and counterclaims in an accord filed with the U.S. District Court in Newark on January 13th. This has not been reported before now.

IDT spokesman Bill Ulrey said, “We have no comment…as usual. Thank you.” Jewett’s attorney William Perniciaro also declined to discuss the matter. When both sides don’t talk about an agreement to dismiss a case, that normally means a confidential settlement has been reached.

Shells, Shams and Corporate Scams

Shells, Shams and Corporate Scams

The American Interest, Jan-Feb 2011 (online Dec 9, 2010)

Corporate secrecy, which involves hiding the identities of company owners from tax and other legal authorities, is itself no secret. It is well known that offshore banking centers such as Switzerland, Liechtenstein and the Cayman Islands have for many years enabled fraudsters all over the world to carry out scams, launder illicit profits, stash stolen loot and hide money from tax authorities.

What most people do not know, however, is that there is a vast and growing American offshore. Foreign crooks prize states such as Nevada, Wyoming and especially Delaware for state laws that don’t require them to list owners or even company officials when a new company is formed. Corporate interests and the Obama administration are blocking congressional efforts to change that.

China blocks international crackdown on offshore, says European Commission President Barroso

China blocks international crackdown on offshore, says European Commission President Barroso

Sept 27, 2010 –

China is the major international power blocking a global solution to the offshore bank and secrecy problem. It is doing so because of its own secrecy jurisdiction, Hong Kong, says José Manuel Barroso, the president of the European Commission.

He said some countries hadn’t been reacting positively to efforts to change the system , to establish a level playing field.

After the meeting, I asked him why the major financial powers hadn’t been able to achieve a solution. He said the problem was “China, because of Hong Kong.”

A Lingering Problem for IDT — CEO admits company official met with Aristide on contract

A Lingering Problem for IDT — CEO admits company official met with Aristide on contract

Barron’s, Sept 20, 2010 –

Scoop summary: Howard Jonas, CEO of U.S. telecom IDT, in an interview with Lucy Komisar, acknowledges for the first time that then Haiti President Jean-Bertrand Aristide in 2003 met with an IDT official during discussions about a contract to pay Haiti Teleco for calls from U.S. customers. That contract included agreement for IDT to send payments to a shell company in the offshore Turks and Caicos Islands. Jonas said IDT got an “ethics letter” from a law firm clearing the deal, but the lawyer said in a memo filed with the court, published here for the first time, that he simply told IDT to do “due diligence.” IDT signed the contract the next day.

A former IDT official, who objected to the deal, was fired and is suing the company; trial is set for Nov 9th. The Justice Department and Securities and Exchange Commission are investigating violation of the Foreign Corrupt Practices Act. Jonas’s revelations are likely to have a major impact in the trial and investigations.

The Wall Street ICEcapade

The Wall Street ICEcapade

The American Interest, July-Aug 2010 (online May 18, 2010) –

As I write this, the U.S. Senate is debating a major financial reform bill in which the credit default swap, a kind of derivative, plays a significant part. An amendment to that bill, proposed by Senators Carl Levin (D-MI) and Jeff Merkley (D-OR), would ban banks from proprietary trading. There are a lot of high-rolling bankers who do not want that amendment to pass, because it will mess up their plans to repatriate foreign profits into the United States, untaxed, by trading in derivatives on their own accounts. The clearinghouse ICE Trust U.S. forms a central part of these plans.

What is ICE Trust U.S., and who owns it? ICE US Holding Co., which was established in 2008 as the parent of ICE Trust U.S., is located in the Cayman Islands. Yet none of the owners of ICE US Holding Co. are based in the Caymans. Among the owners of the Cayman’s company are Citigroup, Goldman Sachs, J.P. Morgan, Merrill Lynch and Morgan Stanley, which are headquartered in New York. Bank of America, which now owns Merrill Lynch, is based in Charlotte, North Carolina.

IDT’s Voodoo Economics: Inside Justice Dept’s probe of telecom bribes in Haiti

IDT’s Voodoo Economics: Inside Justice Dept’s probe of telecom bribes in Haiti

The Big Money, March 11, 2010

When the devastating earthquake hit Haiti in January, IDT, the New Jersey-based global phone company, moved fast to help.

It announced it was setting up calling stations at hotels and other sites so Haitians could use its Internet calling-service to reach family and friends around the world. It cut rates on its U.S. prepaid calling-card to 2 cents a minute to Haiti (at least for 12 days), donated 4,000 $2-prepaid calling-cards to Haitian community groups in New York and Florida, and said it would give some proceeds from prepaid calls to Haitian Red Cross relief.

Such a warm, fuzzy response from a U.S. corporation often wins plaudits, though, of course, IDT has a business interest in the impoverished island. In 2005, in its latest publicly available figures, the company reported $4 million in profits from $17 million in revenues for routing calls there.

CORRUPTION: U.S. banks abetting corrupt regimes, probe finds

CORRUPTION: U.S. banks abetting corrupt regimes, probe finds

Inter Press Service (IPS), Feb 3, 2010 –

The global bank HSBC may be running offshore accounts for central banks. According to a U.S. Senate investigation, an HSBC subsidiary in London called HSBC Equator Bank had a sister bank in the Bahamas.

According to an internal e-mail, the bank told HSBC USA it had been providing offshore accounts to central banks for 20 years, because the banks wanted to avoid “Mareva” injunctions, legally enforceable orders to freeze funds.

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

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

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.

OECD Tax Havens Deal Falls Short, Critics Say

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”

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.

Tax Havens in Spotlight at G20 Meet

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

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.

Offshore tax cheating could become criminal money-laundering offense

Offshore tax cheating could become criminal money-laundering offense

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.

Is NY Gov. Paterson protecting corporate tax evaders?

Is NY Gov. Paterson protecting corporate tax evaders?

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.

Exclusive: How One Fund’s Profits Ended Up in the Caymans

<em>Exclusive</em>: How One Fund’s Profits Ended Up in the Caymans

Inter Press Service (IPS), Feb 5, 2009 –

President Barack Obama said he would crack down on firms that use offshore centres to evade taxes. He could begin with a New York subsidiary of one of the world’s largest private banks, which used a Cayman Islands company to shift its profits.
Julius Baer logo
Why would a New York investment fund manager run operations through an office in the Caymans? “This type of structure is for optimising taxes,” explained Max Obrist, a Cayman Islands official of the global Julius Baer Group (Zurich).

He told IPS that “generating” the income where a company was actually based, “you would pay much more taxes”. Obrist was describing a company shifting claimed earnings to tax havens to evade home taxes. He allegedly helped Julius Baer Investment Management (JBIM) New York do just that.