Archive for the 'Offshore' Category
Haiti Telecom Kickbacks Tarnish Aristide
CorpWatch, Dec 29, 2005
Two U.S. lawsuits charge that former Haitian President Jean-Bertrand Aristide and his associates accepted hundreds of thousands of dollars in kickbacks from politically connected U.S. telecom companies.
Lawsuits filed this Fall challenge the former priest’s image of political purity and raise claims that both he and U.S. corporate executives scammed illegal profits off the hemisphere’s poorest population.
In one suit, a fired executive charged his former employer, the U.S. telecom IDT (Newark, NJ), with corruption, defamation, and intimidation under the New Jersey anti-racketeering law. In the second, the government of Haiti contends that IDT, Fusion (New York, NY) and several other North American telecoms violated the federal RICO anti-racketeering statute. Both suits allege that Aristide, now in exile in South Africa, and his associates, took kickbacks.
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.
Halliburton’s Missing Offshore Subsidiaries
May 31, 2005
In the space of four or five years, Halliburton, the international oil services and construction conglomerate that is under attack for overcharging and underperforming in Iraq, has gone from reporting 70 or 80 offshore subsidiaries in its annual SEC filing to just two, both in the Cayman Islands. Offshore networks had become a central part of Halliburton’s management and financial strategy. When current United States Vice President Dick Cheney was CEO of Halliburton from 1995 to 2000, the company’s offshore subsidiaries increased from nine to 44. By the year 2001, that had nearly doubled. Now most of them have gone missing!
Yukos Kingpin on Trial
CorpWatch, May 10, 2005
In mid-May a Moscow court will issue a verdict in the trial of Mikhail Khodorkovsky, the figure behind Yukos Oil, who was once known as Russia’s richest man. Khodorkovsky, who a few years ago was worth more than $15 billion, is on trial for fraud and tax evasion, much of it made possible through the use of offshore shell companies.
Khodorkovsky has been in prison since 2003, when he was charged with embezzlement and for rigging a privatization auction of the petrochemical company, Apatit. Some critics argue that Khodorkovsky is being held up as a symbol of Russia’s ruling class of exorbitantly wealthy businessmen, and that his trial is politically motivated.
But Western corporations and, by extension, the Western media may in fact be equally motivated to obscure the facts and make Khodorkovsky into a capitalist martyr.
Tax Activists: Big Business Must Pay Its Fair Share
Pacific News Service - April 12, 2005
A new global movement is tracking the increasing number of offshore tax shelters and pressuring governments to make multinationals pay up.
As Americans fret over their personal income taxes, there is a movement afoot to reduce the tax burden on ordinary people by getting corporations and wealthy individuals to pay their fair share.
Last month, the Tax Justice Network (www.taxjustice.net/) issued a report based on publicly available statistics from the Bank of International Settlements and Merrill Lynch, the investment company. The data showed the following:
–Approximately $11.5 trillion of assets are held offshore by high net-worth individuals, or about a third of the total global GDP, the value of goods and services, which in 2003 was $36.2 trillion.
–The annual income that these assets might be expected to earn amounts to $860 billion annually.
–The tax not paid as a result of these funds being held offshore would exceed $255 billion a year.
Bringing Business Back Ashore: Buenos Aires issues world’s first ban on offshore shell companies
CorpWatch, April 4, 2005
In December of 2004, there was a horrific fire in a Buenos Aires disco called the Cromagnon Republic. Three rock fans shot off flares that set fire to the ceiling and engulfed the overcrowded discotheque in flames and smoke. In the rush to get out, 200 people were killed and 700 injured, most from trampling and smoke inhalation. The main entrance had been wired shut, and some of the emergency exits were locked, blocking escape.
In the days that followed, thousands of the victims’ parents and friends marched in the streets and demanded justice. A judge started proceedings for manslaughter and froze $20 million belonging to the “owner,” Omar Chaban. However, investigators soon discovered that Chaban appeared in no official disco documents; he was just the “administrator.” The legal owners of the property and the disco company were offshore shell corporations registered in the tax haven of Uruguay, the neighboring country. The listed “owner” of the enterprise was a Uruguayan “straw man” in his 70s who had no money.
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.
The Fall of a Titan
AlterNet, March 17, 2005.
Maurice “Hank” Greenberg, one of the world’s richest men, and head of AIG, one of the world’s largest financial companies, was forced to resign this week as prosecutors closed in on him and the company.
Given his economic and political power, the fall of Maurice “Hank” Greenberg, the 59th richest man in America and CEO of the American International Group (AIG), the world’s second-largest financial conglomerate (after Citigroup), is stunning.
Take The Money And Run Offshore
AlterNet, Dec 22, 2004
How insurance companies are aiding tax evasion by over-charging in America and shipping the money to offshore firms.
Terry Mills was working in Wilmington, DE, for J. Montgomery, one of the largest insurance agencies in the region, when in 1993 he was called in to get to the bottom of a messy insurance problem. Little did he know that he would uncover a story – as yet unreported – about tax evasion through offshore firms, but with a twist. The scheme Mills came across seemed to be taking place with the aid of AIG, a major U.S. insurance giant.
Cooking the Insurance Books: A Decade of Lax Regulation Lays Groundwork for Scandal
CorpWatch, Nov 17, 2004
In October, New York Attorney General Eliot Spitzer filed suit against the world’s largest insurance broker, Marsh, accusing it of rigging bids and receiving kickbacks in order to defraud clients such as other corporations, city governments, school districts and individuals of billions of dollars through inflated premiums.
“Greedy trial lawyers were the usual excuse for premium increases. Now we know that greedy corporations also have a starring role,” Spitzer said, accusing several insurance companies as co-conspirators in making phony or inflated bids and paying kickbacks to the brokerage to get business.
Cooking the Insurance Books
Nov 2004
Insurance giant AIG has used offshore structures in Barbados and Bermuda to circumvent or violate U. S. state laws regarding reinsurance and to help at least one crooked client evade taxes.
In the late 90s, four state insurance departments were aware that AIG was secretly hiding its debts offshore but, despite substantial evidence of wrongdoing, no sanctions were ordered.
The Case That Kerry Cracked
AlterNet, Oct 22, 2004
As a senator, John Kerry was a tenacious investigator and exposed BCCI, an international criminal bank, and its murderous clients. The experience should serve him well in dealing with the international threats we face today.
One gets an eerie sense of déjà vu watching John Kerry battle the Bush clan. He’s done it once before, against the old man, President Bush’s father, though many voters have probably forgotten. That battle involved the first Bush administration’s attempt to put the lid on an investigation that connected a worldwide criminal bank to narco-traffickers, terrorists, and to Middle East money men who helped the Bush family make piles of cash. Those links connect to people now on the U.S. post-9/11 terrorist list.
Banking on Elections: Finance sector invests heavily in candidates
Corpwatch, Oct 6, 2004
When Phil Gramm came out of the Tavern on the Green one recent August morning, his disposition turned edgy. The former Texas Senator the long-time banking committee chair is now a vice chairman of the Swiss financial corporation UBS. He’d just passed some pleasant hours hobnobbing with comrades in the money trade, all lured to New York by the chance to make profitable connections during the Republican Convention. But Gramm wasn’t keen on talking to waiting journalists, certainly not to the CorpWatch team.
Robert Rubin seemed quite at ease sitting next to Teresa Heinz Kerry at the Fleet Center in Boston, home to the Democratic Convention in July. The Clinton Treasury Secretary, former senior partner at the investment company Goldman Sachs, is now chairman of the executive committee of Citigroup. There was no chance of journalists bearding him in the candidate’s box - at least none who would ask uncomfortable questions.
Rich Dodge Taxes Says Bush – A Flash of Honesty or Another Slip of the Tongue?
Pacific News Service, Sept 9, 2004
When none other than President George W. Bush announces that the real rich dodge taxes, is that an inadvertent flash of honesty about the shady secrets of offshore shell companies and tax shelters? The administration is tying itself up in knots to dodge the significance of his statement.
The real rich dodge taxes and small business owners pay the burden. Does that sound like a radical-liberal denunciation of privilege by candidate John Kerry?
Guess again. It’s a pronouncement by President Bush.
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.
Saddam’s secret money-laundering trail
United Press International (UPI), June 2, 2004
A detailed analysis of Saddam Hussein’s secret money-laundering techniques shows here for the first time how he used the same offshore money launderers as Osama bin Laden. That covert money network, based in the tax havens of Switzerland, Liechtenstein, Panama and Nassau, helped bankroll the war machines of both Iraq and al-Qaida.
More than 1,000 pages of confidential corporate, bank and legal documents show how the network functioned. The papers come from court cases filed in several European countries, from corporate records, from investigations by Italian police, from a report of the Kroll international investigative agency, and from private sources. The documents are the basis of further investigations coordinated in Europe by the prosecutor of Milan.
How Big Business Evades Taxes
Pacific News Service, April 9, 2004
As states and municipalities reel from service cutbacks caused by lower tax earnings, big corporations pay virtually no taxes on huge profits. They do it though elaborate “shell” games.
Were you stunned by the revelation, days before your taxes are due, that nearly two-thirds of companies operating in America reported owing no taxes from 1996 through 2000? That over 90 percent of large corporations — with at least $250 million in assets or $50 million in gross receipts — reported owing taxes of only under 5 percent?
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.
Legal problems for Alexei Golubovich in Switzerland
Dec 2003
Alexei Golubovich, longtime partner of Mikhail Khodorkovsky, is the target of legal action in Switzerland by his former associate Yelena Collongues-Popova and is being investigated by a Geneva judge on her charge of forgery.
Golubovich has not been indicted by Russian prosecutors, though they are interested in talking to the former Yukos finance director who has reportedly fled to London. However, he could be indicted by the Swiss.
Collongues-Popova, who for half a dozen years ran some 30 offshore companies for Golubovich, got a court order in Switzerland that froze $4.2 million she says represents loans he owes a company she owns. Swiss investigative magistrate, Claude Wenger, is looking into her criminal complaint that Golubovich forged her signature to avoid paying the loans.
Criminal complaint filed against Khodorkovsky, Lebedev, and Golubovich in Switzerland
The Russia Journal, Nov 28, 2003
Two ex-bankers on Wednesday, Nov. 26, filed a criminal complaint with the Swiss attorney general against Mikhail Khodorkovsky, Platon Lebedev, and Alexei Golubovich, accusing them of money laundering and support for a criminal organization.
The Russia Journal has obtained a copy of the report. The Journal asked Yukos press office to comment on the charge but no comments were received.
The former bankers have requested the federal officials in Switzerland to open an investigation into the charges and to search the records of the Swiss offices of Menatep SA, Menatep Finances SA and Valmet (in liquidation) and of Bank Leu related to investigate claims of fraud against the Russian company Avisma and money laundering by Menatep in Switzerland.
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.
The richest crook in Russia
Nov 2003
A business group headed by Russia’s richest man, Mikhail Khodorkovsky, who was arrested in October for allegedly defrauding the state of $1 billion, stashed money in offshore centers, including Switzerland, Luxembourg, the British Virgin Islands, the Seychelles, Panama and the Bahamas, according to Yelena Collongues-Popova, who worked for one of Khodorkovsky’s associates. Lucy Komisar, a New York investigative reporter who is writing a book about the offshore bank and corporate secrecy system, interviewed Collongues- Popova. This is her story.
PARIS — A French woman of Russian origin, with thousands of papers related to the Menatep business group and its offshore banking and dealings over the past decade, has been providing information to Russian prosecutors who are building a case against oil tycoon Mikhail Khodorkovsky, the richest man in Russia, who was arrested in October for tax evasion.
She says she set up numerous offshore companies and bank accounts in the Caribbean and Europe to help the Menatep group cheat Russian company shareholders and tax authorities. Her registered agent in the Caribbean was Icaza Gonzalez Ruiz and Aleman in the British Virgin Islands and Bahamas, against which she now has a legal action. She says she used Bank Leu (Bahamas), a subsidiary of Bank Leu, Geneva, to deposit funds in fiduciary accounts to have the benefit of withholding tax exemptions.
Rumsfeld Queried on Offshore Banking Reform
The American Reporter, May 27, 2003
It hasn’t been reported in the U.S. press – until here, now – but Milan, Italy’s chief prosecutor has obtained thousands of documents that show how for more than 20 years Saddam Hussein used the Western bank and corporate secrecy system to launder bribes skimmed from oil revenues to pay his security forces and buy Western arms during international embargoes.
The key countries - whose governments openly allow these money-laundering systems to exist – were Switzerland, Liechtenstein, Panama and Nassau. Corporate registrations and bank accounts there use “straw men” and secrecy rules to cover up true owners of companies and accounts.
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.”
KPMG and the Marcos Money Trail
Multinational Monitor, March 2003
AT A TIME WHEN THE INTEGRITY of global accounting firms is being questioned, the U.S. Securities and Exchange Commission (SEC) and Justice Department are looking into charges that KPMG Zurich, a division of the international audit company, helped Credit Suisse hide hundreds of millions of dollars looted by the late Philippine dictator Ferdinand Marcos.
A KPMG spokesperson confirmed the investigation.
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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