Reports & analysis by award-winning investigative journalist Lucy Komisar “”

Archive for the Category ‘Offshore Overviews’

Profit Laundering and Tax Evasion: The Dirty Little Secret of Financial Globalization

Profit Laundering and Tax Evasion: The Dirty Little Secret of Financial Globalization

Dissent Magazine, Spring 2005

The debate about cutting taxes for corporations and the wealthy is a false one. The issue is not whether transnational corporations and the very rich benefit from tax cuts, but that many of them walk away from all taxes. A General Accounting Office report found that between 1996 and 2000, 61 percent of all U.S. companies paid zero federal taxes. They accomplish this primarily through “profit laundering,” a phrase that ought to be on the lips of every social critic.

Offshore Banking: The Secret Threat To America

Offshore Banking: The Secret Threat To America

Hound-Dogs, March 2004
(Same title but not same article as in Dissent 2003)

This is a story about a massive money-laundering operation run by the world’s biggest banks. It hides behind the “eyes-glazing over” technicalities of the international financial system. But it could be one of the biggest illicit money-moving operations anyone has ever seen. And it’s allowed to exist by the financial regulators who answer to Western governments.

In these days of global markets, individuals and companies may be buying stocks, bonds or derivatives from a seller who is Clearstreamhalfway across the world. Clearstream, based in Luxembourg, is one of two international clearinghouses that keep track of the “paperwork” for the transactions.

Offshore Banking: The Secret Threat to America

Offshore Banking: The Secret Threat to America

Dissent Magazine, Spring 2003

In November 1932, deputy Fabien Albertin took the floor of the National Assembly in Paris to denounce tax evasion by eminent French personalities-politicians, judges, industrialists, church dignitaries, and directors of newspapers-who were hiding their money in Switzerland.

“The minister of finance knows very well that for ten years, the concern of all his predecessors has been to track down this fraud . . . ” he declared. “However, till now, the information one has gotten has been extremely vague. When documents arrive, they are formless notebooks in which holders of accounts are represented only as numbers. Employees of the banks don’t know the names of account holders. These names are known only to the director of the bank, who the clients forbid to correspond with them, so anxious are they to preserve anonymity.”

Après l’air pollué, l’argent pollué

Après l’air pollué, l’argent pollué

Publié par The Nation, 18 juin 2001

En février 2001, après la réunion des pays les plus industrialisés, plus connus sous le nom du G7, lorsque Paul O’Neill, secrétaire d’Etat au Trésor (ministre des finances américain), a déclaré qu’une initiative européenne visant à enrayer le blanchissage de l’argent “ ne consiste pas à dicter aux pays quel est le niveau convenable de la taxation ”, il était clair que c’en était fait. Pendant 18 mois environ, les Etats Unis avaient indiqué qu’ils pensaient sérieusement se joindre aux Européens dans leurs modestes efforts pour s’occuper de l’argent illicite blanchi de part le monde.

After Dirty Air, Dirty Money

After Dirty Air, Dirty Money

The Nation, June 18, 2001

When Treasury Secretary Paul O’Neill said after the February meeting of the top industrialized countries, known as the G-7, that a European initiative to clamp down on money laundering “is not about dictating to any country what should be the appropriate level of tax rates,” it was clear that the game was over.

For about eighteen months the United States had signaled that it was serious about joining the Europeans in modest efforts to deal with the tide of illicit money that washes around the world. Now, the Bush Administration was saying that it was backing off the US commitment to reform the offshore banking system. Instead, the “tough on crime” Republicans would stand shoulder to shoulder with the shady characters in Nauru, Aruba, Liechtenstein and elsewhere who offer state-of-the-art financial services for crooks.

Fool Me Twice

Fool Me Twice

The Progressive, Dec 1999

The Russian banking scandal should have been no surprise to Western financial experts. The Bank of New York laundered some $7 billion in Russian money through the offshore system.

The sudden attention by U.S. government officials and the mainstream media to the $7 billion or more of Russian money laundered through the Bank of New York might make you think this is the first time that multimillions have been stolen from Russia-or elsewhere-and washed through the international offshore system. In fact, it’s not even the first time for the Bank of New York.

Cleaning up the murky waters of offshore banking

Cleaning up the murky waters of offshore banking

Global Finance, Nov 1999

The US government is making its boldest move yet to combat international money laundering via offshore bank secrecy havens. Officials who once insisted “capital should flow to wherever the market says to flow” now want to make it more costly for American banks to lend to entities in “bad jurisdictions.”

The American crackdown depends on the passing of new law that require banks to set aside reserves for the loans they have made to high-risk jurisdictions. The strategy, announced in September, is undergoing a 90-day US interagency review. It targets offshore centers that hide the beneficial owners of companies and bank accountants and refuse to cooperate with international law enforcers on the trail of illicit funds.