Tag Archives: tax haven

Senator wants IRS to show what it’s done about tax fraud since Panama Papers reports

An influential Democratic senator has demanded answers from the IRS about what it has done since the Panama Papers were published last spring to combat tax fraud committed through anonymous shell companies.

Oregon’s Ron Wyden is the top Democrat on the Senate Finance Committee and could become its chairman if Democrats regain control of the chamber in November elections. He sent a three-page letter on Wednesday to Treasury Secretary Jacob Lew and IRS Commissioner John Koskinen, asking for data on required reporting about shell companies.

“It’s critical to determine whether our government has the right tools to discern legitimate businesses from criminal enterprises, and to identify what additional measures might be needed to fight financial crime,” Wyden said in his letter.

PAKISTANI COURT ISSUES NOTICE TO PM IN PANAMA PAPERS CASE

On Thursday, Pakistan’s Supreme Court issued notices for Prime Minister Nawaz Sharif, his daughter, son and son-in-law and others to respond to calls by opposition politicians for Sharif’s resignation in the wake of Panama Papers.

The start of the Supreme Court hearing was the latest chapter in a battle between Sharif and members of the opposition that has roiled the country since April.

“Nawaz Sharif should be held accountable like the prime minister of Iceland who was also named in the Panama Papers,” said Imran Kahn, a former international cricket star who is now a prominent opposition politician. Khan told reporters outside the Supreme Court in Islamabad that the panel of judges gave Sharif two weeks to provide a response.

Sharif welcomed the Supreme Court hearing, noting that he has also set-up a commission to examine the Panama Papers’ revelations, including reports that some of Sharif’s children were linked to offshore companies and property in the United Kingdom.

Opposition parties have called for a city-wide protest on November 2 to lockdown the capital city, Islamabad, home to two million people. According to reports, protestors will block all roads leading to government offices.

Meanwhile in the United States, the Democrat’s most senior member of the powerful Senate Finance Committee, Ron Wyden of Oregon, has demanded answers from the Internal Revenue Service and the Department of the Treasury about the ability of the U.S. to combat tax evasion and financial crime.

Using information obtained through ICIJ’s public Offshore Leaks database and through the committee’s own investigations into Panama Papers-related matters, Wyden sent a three-page letter on Wednesday seeking information on what thousands of shell companies linked to the Panama-based law firm Mossack Fonseca have reported to U.S. authorities about their taxes and activities.

“It’s critical to determine whether our government has the right tools to discern legitimate businesses from criminal enterprises, and to identify what additional measures might be needed to fight financial crime,” Sen. Wyden wrote.

Overnight in Beirut, Lebanon, parliamentarians reportedly agreed to new laws that would keep Lebanon off a blacklist of tax havens.

Read on.

Breaking: ICIJ and media partners reveal details of latest offshore leak

New revelations published today by theInternational Consortium of Investigative Journalists, the German newspaperSüddeutsche Zeitung and news organizations from Europe, South America, Asia and Africa reveal fresh information about offshore companies in the Bahamas.

Alongside detailed reporting, ICIJ, Süddeutsche Zeitung and other media partners are making details from the Bahamas corporate registry available to the public. This creates, for the first time, a free, online and publicly-searchable registry of offshore companies set up in the island nation that has sometimes been called “The Switzerland of the West.”

“We see it as a service to the public to make this basic kind of information openly available,” said Gerard Ryle, the director of the International Consortium of Investigative Journalists.

“There is much evidence to suggest that where you have secrecy in the offshore world you have the potential for wrong doing. So let’s eliminate the secrecy.”

The cache of documents from the island nation’s corporate registry provides names of directors and some owners of more than 175,000 Bahamian companies, trusts and foundations registered between 1990 and early 2016.

The leaked Bahamian files reveal details of the offshore activities of prime ministers, ministers, princes and convicted felons.

Read on.

After EU’s Apple Decision, Obama Says Tax Coordination Needed

  • Global tax avoidance strategies were part of G-20 discussion
  • Obama comments on EU tax decision requiring Apple to pay

International tax policies should be better coordinated among countries to avoid problems, President Barack Obama said on Monday, following the European Union decision that would require Apple Inc. to pay billions of dollars in back taxes.

“It’s in the interest of all countries, whether they’re developed countries or developing countries, to put a stop to this,” Obama told reporters at the close of the G-20 summit in Hangzhou, China. He was speaking for the first time about the decision that could cost Apple, a U.S.-based company, as much as 13 billion euros ($14.5 billion).

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Panama Papers: Federal Board of Revenue (FBR) moves against ‘owners’ of offshore companies

ISLAMABAD: 

Tax authorities have started sending letters to over 600 Pakistanis, who, according to the Panama Papers, own offshore companies, though chances of recovering due taxes from them are slim owing to legal lacunae.

“This week, the Federal Board of Revenue (FBR) has begun the process of sending letters to hundreds of Pakistanis who have been named in the Panama Papers,” said FBR spokesperson Dr Mohammad Iqbal on Saturday.

“These people have been requested to confirm whether they own these offshore companies or not,” he added. The letters have been sent under Section 176 of the Income Tax Ordinance, which empowers tax officials to seek information about any transaction. However, the penalty for not giving information under Section 176 is mere Rs25,000.

The decision to send notices to about 600 Pakistanis coincided with Pakistan Tahreek-e-Insaf’s ‘Pakistan March’ against the government over alleged corruption and delay in taking action against those who have been named in the Panama Papers.

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Bank linked to ‘Panapa Papers’ hit with $180M laundering fine

New York’s top financial regulator slapped a “Panama Papers”-linked bank with a $180 million fine for anti-money laundering violations.

Mega Bank, a $103 billion Taiwanese bank with one New York office, ignored the risks associated with transactions involving Panama, a high-risk area for money laundering, the state Department of Financial Services said in a statement on Friday.

The bank had “suspicious” accounts that were formed with the help of Mossack Fonseca, the law firm at the center of the “Panama Papers” leak, which revealed companies and wealthy individuals who dodged taxes, the DFS said.

 The bank had lax controls and relied on untrained personnel, including a chief compliance officer who wasn’t familiar with anti-money-laundering rules.

Here are the companies stashing the most cash overseas

The amount of money stashed overseas by U.S. multinationals has exploded in recent years, doubling between 2008 and 2014 to more than $2 trillion.

For some perspective on the numbers, cost-estimating website HowMuch.net crunched the most recent data and created a telling interactive chart.

Topping the list: Apple AAPL, +1.52% and its massive $181.1 billion overseas stash, a $70 billion increase from the prior year. That total corresponds to $59.2 billion in deferred taxes, which is enough to cover more than two-thirds of the federal budget for education, training and employment, according to the 2014 numbers compiled by Citizens for Tax Justice last October.

Elsewhere, General Electric’s GE, +0.35%  taxes could take care of almost 5% of our Social Security costs, while taxes from Microsoft MSFT, +0.99% had it kept its money in the U.S., could have covered a fifth of all federal spending on veteran’s benefits.

Read: Dodging tax is not just about offshore havens.

According to estimates, the prevalence of offshore tax havens causes the U.S. to lose out on $90 billion in federal income taxes each year. That’s no small chunk.

Read on.

Trump campaign manager’s Ukrainian clients have Panama Papers connections

GOP presidential nominee Donald J. Trump sent shudders through US foreign policy circles and the international community this week, when he suggested that, as president, he might not fulfill America’s promises to defend NATO members against a Russian attack. That departure from historical American policies, and Republican wisdom, came days after the Trump campaign reportedly softened the GOP platform’s hardline stance against pro-Russian rebels fighting to control Ukraine.

Those moves were less surprising to critics of Trump’s campaign manager, Paul Manafort, who for more than a decade has cultivated business ties to pro-Russian politicians and industrialists in Ukraine.

Now, Fusion has learned that the names of several of Manafort’s connections appear in shell company records from the notorious Panama Papers and the Offshore Leaks, troves of information on offshore companies unearthed in recent years by the International Consortium of Investigative Journalists.

Read on.

Netflix to bring ‘Panama Papers’ to life with new feature film

Netflix is looking for its Spotlight.

The Los Gatos-based streaming service announced Tuesday that it is tackling the definitive story behind The Panama Papers, which some deem the biggest leak in the history of journalism.

The leak released 2.6 terabytes of data in 11.5 million documents tracking billions of dollars over almost 40 years. In the process, world leaders, athletes and celebrities around the globe were implicated.

More than 370 journalists from more than 100 media outlets in almost 80 countries around the world worked on the story, but it was German journalists Frederik Obermaier and Bastian Obermayer — and the International Consortium of Investigative Journalists — that took the lead.

Netflix has acquired the rights to Obermaier and Obermayer’s book The Panama Papers: Breaking the Story of How the Rich and Powerful Hide Their Money

Read on.

Panama Papers reveal yet another secretive aspect of hedge funds

HIGHLIGHTS

Bernard Madoff’s feeder funds show up in the Panama Papers

2 other managers who used offshores to hide assets find themselves in jail

One fund manager says there is room for more transparency

The kinds of secret offshore companies that have hidden political corruption and tax evasion around the world are often used by Wall Street’s biggest money makers — the $2 trillion hedge fund industry.

The now-famous Panama Papers leak offers rare insight into the workings of this exclusive investment club.

Hedge funds accept individual investors with net worths of $1 million or more and worker pension funds with $5 million or more. They and their investors often locate in tax havens such as the Cayman Islands or the British Virgin Islands.

The names found in the leaked files from the Panamanian law firm Mossack Fonseca include two now-imprisoned hedge fund managers, a major “feeder fund” that was part of the largest-ever Ponzi scheme run by Bernard Madoff and several anonymous investors whose offshore companies became tangled in the Madoff web.

In the aftermath of the Madoff scandal and the 2008 U.S. financial crisis, hedge funds have been forced to register with regulators, and they face severe penalties under a new “bad actor rule” if they take money from criminals or proceeds of corruption.“Most financial institutions do require considerable information on investors” today, said Robert Van Grover, an attorney with Seward & Kissel LLP in New York who thought the abuses found in the Panama Papers “would be very difficult in the United States” now.

But the hedge fund managers and their investors identified in the leaked documents by McClatchy and partners underscore what has been a weakness in oversight: They often used secret offshore companies, which hid investor fraud and potentially unsavory investors from U.S. regulators.