Archive for the 'Corporate Abuses' Category
Corruption: Another Lead in Siemens Bribery Probe?
Inter Press Service (IPS), Aug 30, 2007
U.S. officials from the Securities and Exchange Commission, the Justice Department and the Federal Bureau of Investigation met with Munich prosecutors this week regarding the 1.3-billion-dollar bribe fund run by Siemens, the German multinational technology company.
After talking to the Germans about tracking the financial flows of the largest illicit slush-fund ever discovered, the U.S. investigators would do well to visit Luxembourg on Germany’s western border.
There they could seek information from Clearstream, the international financial clearing house, that might tell them how Siemens moved so much money and where it went. That is because Siemens has the unusual status of being one of only four non-financial companies among 2,500 Clearstream members. It gained membership on the insistence of a former CEO who was fired after a scandal.
Siemens has a $1.3-billion bribe fund; did it move payoffs through Clearstream?
Aug 15, 2007
Siemens, the German-based multinational technology company that made massive payoffs to get international contracts, has, according to the German press, a bribery slush fund of more than $1.3 billion. 
It moved money through a network of front companies, mostly in offshore Liechtenstein and the United Arab Emirates. Siemens is being investigated by the U.S. Justice Department and the Securities and Exchange Commission as well as by public prosecutors in Germany and Italy.
How did Siemens officials move so much money about? Investigators ought to take a look at Siemens’ transactions through Clearstream, the international financial clearing house in Luxembourg, whose clients do not undergo the same due diligence scrutiny that regular banks apply.
Siemens is one of only four non-financial companies (out of 2500) with Clearstream accounts. Here — published for the first time — are listings of Siemens’ Clearstream accounts for 1995, 2000 and 2001.
Corporate Profits Take an Offshore Vacation
Inter Press Service (IPS), Feb 23, 2007
How big pharma and technology companies move patents offshore to cheat on $ billions of home taxes
Last week, Merck, the pharmaceutical multinational, announced that it will pay 2.3 billion dollars in back taxes, interest and penalties in one of the largest settlements for tax evasion the U.S. Internal Revenue Service (IRS) has ever imposed. Merck had cooked its tax books by moving ownership of its drug patents to its own Bermuda shell company — an entity that has no real employees and does no real work — and then deducting from U.S. taxes the huge royalties it paid itself.
What Merck did isn’t unusual but in fact is becoming common for multinationals in the era of globalisation. It’s one of the ploys in a corporate bag of tricks called profit laundering. In an era where much of a company’s assets may be intangible intellectual property — patents, logos, manufacturing processes — this strategy can make reported profits and taxes disappear.
Exclusive: Confessions of a Citibanker
Is Citibank Spain a tax cheat?
New Internationalist, Aug 2006
With help from a whistleblower, I followed the money trail through the offshore operations of Citigroup, the world’s biggest bank, and discovered that Spanish bankers handling their client’s offshore accounts were getting commissions via an internal accounting system instead of on the regular books.
It is the same internal system that Citigroup used in the 1970s to compensate currency traders in Paris, London, Frankfurt and elsewhere who “booked” trades in the tax haven Nassau, the Bahamas. They were exposed by an insider, were investigated by the SEC and Congress, and had to pay millions in back taxes. Is this happening again?
France & UK Ignore Corporate Bribery: One Hand Launders the Other
Inter Press Service (IPS), Dec 29, 2006
Investigators find evidence that Siemens (German electronics & engineering firm), Total (French oil company), and BAE (British arms conglomerate) paid multi-millions of dollars in bribes through bank accounts in Switzerland and other offshore centers.
France and the UK argue “national security” to block inquiries. Concern is more likely the “security” of top officials who got kickbacks.
Spain’s discovery that funding for Basque terrorist group ETA goes through tax havens is dramatic proof that “national security” lies not in protecting but in dismantling the global offshore secrecy network.
US/Haiti: Top Republicans Leave Telecom Accused of Bribery
Inter Press Service (IPS) - Nov 6, 2006
The company is under investigation by the SEC, the United States Attorney in Newark, New Jersey, and a U.S. federal grand jury for allegedly paying bribes to Jean-Bertrand Aristide, former president of Haiti. Five nationally prominent US Republicans, the independent board members of a corporation that has been charged with paying hundreds of thousands of dollars in bribes to get a sweetheart telecom deal in Haiti, are leaving its board. The company is IDT, the world’s third-ranked international phone company.
IDT is run by James Courter (shown here), 
a former New Jersey Republican congressman. The other Republicans are Rudy Boschwitz, former senator from Minnesota; James S. Gilmore III, former Virginia governor; Thomas Slade Gorton III, former senator from Washington State; Jack Kemp, former congressman from New York and 1996 vice presidential nominee; and Jeane Kirkpatrick, the former U.S. ambassador to the UN under President Ronald Reagan.
US/Haiti: Govt Corruption Suit Stalls for Lack of Funds
Inter Press Service (IPS), Oct 26, 2006
The U.S. Justice Department is withholding agreement to share assets seized from Haitian drug traffickers to finance a lawsuit by the Haitian government charging former President Jean-Bertrand Aristide with taking bribes. 
The suit is based on allegations by a former executive of the telecom company IDT that before Aristide left the country in 2004, he took hundreds of thousands of dollars in kickbacks from IDT, which is connected to prominent U.S. Republicans.
Fees for Our Friends: The Scandal that Taints Andrew Cuomo
By Lucy Komisar
Aug 22, 2006 [Part 1]
When Andrew Cuomo became HUD Secretary in 1997, he reversed the policy of selling defaulted mortgages so that families could keep their homes. Instead, he chose to foreclose on mortgages, which meant that families lost their homes and insiders cleaned up on fire-sale priced properties. The program he axed had saved the U.S. $2.2 billion between 1994 and 1997. Cuomo fired the former HUD official whose company designed the program.
That wasn’t the only money big money lost under Cuomo. HUD reported at the time that $59 billion was missing! It couldn’t say where the money went, because it failed to produce audited financial statements.
Follow Aristide’s Money Offshore: How Haiti was looted with the help of tax haven shell companies & secret bank accounts and U.S. citizens & corporations
Haiti Democracy Project, Nov 10, 2005
Add former Haitian president Jean-Bertrand Aristide to the long list of corrupt and repressive officials who have used Western banks and companies and offshore tax havens to plunder their countries and launder the stolen money.
Aristide and his associates looted government coffers, wrote checks to front companies for nonexistent purchases, padded invoices to get kickbacks from vendors, secretly owned companies that cheated Haiti of taxes, and laundered the money they stole through shell companies and secret bank accounts set up in the United States and the offshore tax havens of Turks and Caicos and the British Virgin Islands.
Nearly $20 million has been documented as stolen between 2001, when Aristide took office as president for the second time, and 2004, when he fled or was forced out of the country according to varying accounts.
Study: “Russia loses $9 billion through phony import - export priced trade with the United States”
The Russia Journal, July 1, 2004
Three U.S professors, analyzing import and export transactions between Russia and the U.S., have found that phony prices led to as much as $8.92 billion in capital flight from Russia to the U.S. in 1995-1999.
Even with calculations providing the most conservative estimate, at least $1.86 billion illegally left Russia during that period. Assuming a 25 percent average tax rate, the lower figure would mean nearly half a billion dollars in illegal tax evasion, and the higher one more than $2 billion in taxes lost, just in trade involving the U.S.
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.
Menatep paper trail
The Russia Journal, Nov 5, 2003
The charges against key shareholders in Yukos are enormous and very varied in scope. The Yukos tale is a long, complex and controversial one, requiring lengthy and painstaking substantiation. Public interest in the Yukos controversy is very high.
However charges and counter charges, mostly of a political nature, are being flung so wildly about in the media that The Russia Journal believes it essential at this stage to focus on the evidence in the accusations against Mikhail Khodorkovsky and his partners. His innocence of the charges that have been filed against him must be presumed until a competent trial is held.
Those who support his innocence of the charges are invited to review and comment on this, the first in a Russia Journal series on the case against him and others in Menatep Group.
Taking Stock: Unions join fight against offshore corporations
In These Times, Jan 17, 2003
Trade unions, workers’ pension funds and state officials are taking the lead in a campaign to prevent companies from reincorporating in Bermuda and other tax havens—and to bring back those who’ve already gone.
Arguing that offshore registrations allow corporations to evade taxes, reduce shareholder rights and threaten the security of investments, the AFL-CIO, individual unions and pension funds such as California’s Public Employees Retirement System (CalPERS) are filing shareholder resolutions and going to court against companies that move their paper headquarters offshore, where corrupt corporate executives have an easier time cooking the books.
BCCI and the Bushes
Lucy Komisar writes about the criminal offshore bank BCCI and the way it connected the Bushes, the Saudis, Saddam and Osama bin Laden 
in her chapter, “BCCI’s Double Game: Banking on America, Banking on Jihad,” in ”A Game As Old As Empire.”
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