The Tax Evasion Double Standard: How US CEOs Are Withholding Revenue

If I refused to pay any taxes until the US government lowered my taxes to a so-called “fair rate,” I’d almost certainly be arrested for tax evasion. But when The Washington Post asked Apple CEO Tim Cook about the billions that his company has stashed in tax havens around the world, Cook declared: “We’re not going to bring it back until there’s a fair rate. There’s no debate about it.”

And nothing happened, either to Cook or to Apple. Because when it comes to taxes, it’s truer today than ever that only the little people pay.

Apparently though, that’s not enough for the CEOs of multinational corporations, like Tim Cook. He doesn’t just want to avoid taxes, he wants Americans to know that Congress isn’t writing the rules; Apple is.

Dave Johnson from Campaign for America’s Future wrote a great article about this titled, “CEO Of Giant Corporation Tells US Government He’s the Boss of Them.” In it, Johnson writes:

[T]hese days huge multinational corporations are the boss of our Congress. So, CEO Cook gets away with it, and with keeping $181 billion in tax havens to dodge paying $59 billion in taxes. Cook knows he can just come out and say they are not going to pay their taxes until there is a “fair rate.”

And he’s right.

But Apple is by no means the only corporation doing this.

In March, Citizens for Tax Justice reported that US Fortune 500 corporations are avoiding up to $695 billion in US federal income taxes by holding $2.4 trillion of “permanently reinvested” profits offshore. That’s nearly $700 billion that the largest US corporations — corporations like Netflix, Nike and Citigroup — are stashing in offshore tax havens.

Read on.

Iraqi Woman Uses Chilcot Report in War Crimes Lawsuit Against George W. Bush

An Iraqi woman who is suing George W. Bush, Dick Cheney and others for waging a war of aggression in Iraq has asked an appellate court to consider parts of the British Chilcot Report, which documents war crimes by high members of the Bush administration.

Read more…

Deutsche Bank explored merger with Commerzbank: report

Marketwatch:

Deutsche Bank AG DBK, +1.28% DB, +1.43% has explored a possible merger with rival German lender Commerzbank AG CBK, +0.39% Manager Magazin reported on Wednesday, without citing any sources. The German magazine said the merger talks were only theoretical and at a very early stage. It was unclear whether the discussions will be resumed. The publication also said the bank was considering other options to bolster profitability, including a possible reintegration of its Postbank branches that were put up for sale. Deutsche Bank has recently struggled to stay profitable, reporting a 98% slide in profits in the second quarter, hurt by a weak performance in its trading and investment banking units.

Close the Wall Street CEO Bonus Loophole

Truthout:

Over 9 million American families lost their homes in the aftermath of the 2008 financial crisis and millions watched their retirement savings evaporate. Meanwhile, the Wall Street banks that caused the crash were doling out executive stock options that would generate huge windfalls once bailout funds had pushed up their stock prices.

Then, thanks to a perverse loophole in the tax code, the banks could write off the entire cost of these options and other bonuses, leaving ordinary taxpayers to make up the difference.

The origin of this loophole is a President Bill Clinton reform in 1993. After campaigning against the abuses of excessive CEO pay, he pushed Congress to cap the deductibility of pay at $1 million. But he included a huge loophole for so-called “performance-based” pay.

So what did companies do? They kept salaries around $1 million and labeled the rest “pay for performance.”

This loophole applies to all companies, but it has been particularly obscene and even dangerous when it comes to the financial industry. In the run-up to the crash, the loophole helped fuel the “take the money and run” CEO pay practices on Wall Street. In the eight years before their firms collapsed, executives at Lehman Brothers and Bear Stearns cashed out a combined $2.4 billion in bonuses and stock, most of it fully deductible “performance based” pay.

After the economic meltdown, Wall Street bailout recipients such as JPMorgan Chase, Bank of America, PNC Financial and SunTrust lost the privilege of deducting lucrative executive pay and bonus plans from their corporate taxes. But these banks rushed to escape from public bailout pay controls, some by borrowing in the private market to pay back Uncle Sam.

As a result, Wall Street banks quickly returned to their profligate ways, doling out massive bonuses to top managers, while deducting the cost and leaving ordinary taxpayers to make up the difference.

Justice Dept. approved diverting funds in Bank of America settlement

Bank of America was able to wipe about $225 million off its record $16.6 billion Justice Department mortgage fraud settlement by making donations to nonprofit and legal groups approved by the Obama administration.

But the bank only had to make $100 million in donations to do that, thanks to little-known provisions in the settlement, included at the Obama administration’s insistence.

Groups receiving the money include liberal organizations such as Hispanic civil rights group the National Council of La Raza ($1.5 million), the National Urban League ($1.1 million) and the Neighborhood Assistance Corporation of America ($750,000). Another $4.3 million went to the Local Initiatives Support Corporation, a nonprofit where former Clinton administration Treasury Secretary Robert Rubin is chairman.

Read on.

Apple : EU scrutinising around six other 1990 Irish tax opinions – report

The European Commission is scrutinising around six tax opinions multinationals received in Ireland in the early 1990s, the same period in which it said one granted to Apple amounted to illegal state aid, Ireland’s Sunday Business Post said.

Last week, European Union antitrust regulators ordered Apple to pay up to 13 billion euros ($14.5 billion) in taxes to the Irish government after ruling that Ireland granted undue and selective tax benefit to the company.

Apple denies that Dublin gave it any tax breaks, a view shared by Ireland’s Office of the Revenue Commissioners, which assesses and collects taxes, and the Irish government, which on Friday agreed to join Apple in appealing the decision.

The Commission is now actively scrutinising multiple tax opinions given to multinationals in Ireland and focusing on around six that could lead to Apple-style investigations, the Sunday Business Post said, without quoting any sources.

Read on.

Victory over Citizens United for NY AG

This week in the Citizens United v. Schneiderman case, the judge dismissed Citizens United’s challenge to the Attorney General’s longstanding donor disclosure rules. Under the Court’s ruling, Citizens United must finally disclose its biggest donors to the Attorney General’s Office.

Attorney General Schneiderman issued the following statement in response:

“Today’s decision is a victory for common sense oversight of New York’s vast nonprofit sector. New Yorkers deserve to know their donations are protected against fraud and abuse, and today the court protected that right by dismissing each and every one of Citizen United’s claims.”

Read the New York Daily News story here.

NEW CFPB RULES TO THWART WRONGFUL FORECLOSURES

The Consumer Financial Protection Bureau (CFPB) approved rues on August 5, 2016, to help prevent wrongful home foreclosures.

Mortgage servicers will be required to promptly notify borrowers when loss mitigation applications are complete.  Many mortgage servicers never considered an application complete and repeatedly demanded information and documents that the borrower had already provided.  Many borrowers complained that the servicers often demanded federal income tax returns over and over.  Borrowers were required to make adjusted monthly payments while the applications were pending.  The repeated stalling benefited the banks and servicers.  Many borrowers reported that when their applications were finally refused, the interim payments were never credited to their accounts.  Servicers are also prohibited from dual tracking – pursuing both a modification and a foreclosure simultaneously.

… [Read More]

NOVASTAR FINANCIAL FILES FOR BANKRUPTCY

Novation Companies, formerly known as NovaStar Financial, a company that made over $11 billion in mortgage loans that failed at very high rates during the housing crisis, filed for bankruptcy court protection in Baltimore on July 20, 2016.

NovaStar was a major participant in mortgage-backed securities.…[Read More]

The Disaster of American Loan Servicing

From David Dayen at Salon:

It shouldn’t be terribly difficult to accept a monthly loan payment from a homeowner or a student borrower, and to manage day-to-day operations on the loan. This is the job function of a servicer, a company that handles loans on behalf of the ultimate owner, funneling payments through the system and deciding how to manage defaults.

Why this has become the most impossible business in America doesn’t make a lot of sense. But with evidence mounting up, we should acknowledge that servicers either don’t know what they’re doing or can’t turn a profit on their operations without doing so at the expense of their customers. And we must start thinking about alternatives to the current servicing model, which appears to be hopelessly broken.

Read the rest of the article at Salon.