Panama Papers

[Sounder]

[Post deleted owing to libel concerns. Apologies, and thanks for your understanding. - Jeff]

[seemslikeadream]

[Post deleted owing to libel concerns. Apologies, and thanks for your understanding. - Jeff]

[seemslikeadream]

Panama Papers: Act now. Don't wait for another crisis
Thomas Piketty
Financial secrecy represents a huge threat to the fragile global system, and we won’t solve the problem by politely asking tax havens to stop behaving badly

Saturday 9 April 2016 14.00 EDT Last modified on Saturday 9 April 2016 19.46 EDT

The question of tax havens and financial opacity has been headline news for years now. Unfortunately, in this area there is a huge gap between the triumphant declarations of governments and the reality of what they actually do.

In 2014, the LuxLeaks investigation revealed that multinationals paid almost no tax in Europe, thanks to their subsidiaries in Luxembourg. In 2016, the Panama Papers have shown the extent to which financial and political elites in the north and the south conceal their assets. We can be glad to see that the journalists are doing their job. The problem is that the governments are not doing theirs. The truth is that almost nothing has been done since the crisis in 2008. In some ways, things have even got worse.

Let’s take each topic in turn. Exacerbated fiscal competition on the taxing of profits of big companies has reached new heights in Europe. The United Kingdom is going to reduce its rate to 17%, something unheard of for a major country, while continuing to protect the predatory practices of the Virgin Islands and other offshore centres under the British Crown. If nothing is done, we will all ultimately align ourselves on the 12% of Ireland, or possibly on 0%, or even on grants to investments, as is already sometimes the case. In the meantime, in the United States where there is a federal tax on profits, that rate is 35% (not including the taxes levelled by states, ranging between 5% and 10%).

It is the political fragmentation of Europe and the lack of a strong public authority which puts us at the mercy of private interests. The good news is that there is a way out of the current political impasse. If four countries, France, Germany, Italy and Spain, who together account for over 75% of the GDP and the population in the eurozone put forward a new treaty based on democracy and fiscal justice, with as a strong measure the adoption of a common tax system for large corporations, then the other countries would be forced to follow them. If they did not do so they would not be in compliance with the improvement in transparency which public opinions have been demanding for years and would be open to sanctions.

The Panama Papers: leaktivism's coming of age
The theory that leaking information is an effective form of social protest is being put to the test like never before. It could give rise to capitalism’s greatest crisis yet
Read more
There is still a complete lack of transparency as far as private assets held in tax havens are concerned. In many areas of the world, the biggest fortunes have continued to grow since 2008 much more quickly than the size of the economy, partly because they pay less tax than the others. In France in 2013 a junior minister for the budget calmly explained that he did not have an account in Switzerland, with no fear that his ministry might find out about it. Once again, it took journalists to reveal the truth.

Automatic transmission of information about financial assets, which is officially accepted in Switzerland and is still refused in Panama, is meant to deal with the question in the future. The only drawback is that this will only begin to be applied, somewhat cautiously, from 2018, with glaring exceptions, for example for the shares held in trusts and foundations. All this has been set up without the slightest sanction being laid down for countries which default. In other words, we continue to live under the illusion that the problem will be resolved on a voluntary basis, by politely requesting tax havens to stop behaving badly. It is urgent to speed up the process and impose heavy trade and financial sanctions on countries which do not comply with strict rules.

Let there be no mistake: only repeated application of sanctions of this type, at the slightest non-compliance (and there will be some, including by our dear neighbours in Switzerland and Luxembourg), will enable the credibility of the system to be established and an end seen to this climate of lack of transparency and widespread practice of impunity for many decades.

At the same time, a unified register of financial securities must be established; this involves putting Central Depositories under public control (Clearstream and Eurostream in Europe, Depository Trust Corporation in the United States) as Gabriel Zucman has clearly shown. In support of this approach, a common registration fee for these assets could also be envisaged, with the revenue used to finance a global public good (for example, the climate).

There is still one question outstanding: why have governments done so little since 2008 to combat financial opacity? The simple answer is that they were under the illusion that there was no need to act. Their central banks had printed enough currency to avoid the complete collapse of the financial system, thus avoiding the mistakes which post-1929 led the world to the brink of complete collapse. The outcome is that we have indeed avoided a widespread depression but in so doing we have refrained from the necessary structural, regulatory and fiscal reforms.

We could reassure ourselves by noting that the balance sheet of the major central banks (which has risen from 10% to 25% of GDP) remains low in comparison with the total financial assets held by public and private actors over each other (approximately 1,000% of GDP or even 2,000% in the United Kingdom) and could rise further in case of need. In reality, this mainly reveals the persistent hypertrophy of private-sector balance sheets and the extreme fragility of the system as a whole. It is to be hoped that the world will learn from the lessons of the Panama Papers and at long last combat financial opacity without waiting for a further crisis.
© Thomas Piketty, Le Monde

[divideandconquer]

Really? So we are supposed to accept the idea that Britain has made decisions the US doesn't like,

And therefore, Britain becomes a legitimate target for destabilisation, even though it is arguably the most consistent and loyal ally of the US for the last half century

That is ridiculous and insane. The US has plenty of hostile elements in the world currently, not least Putin and the Chinese gang.

The suggestion that they have turned on the UK in such a public way is bullshit in my opinion

I totally agree, but perhaps they want to create the impression...

Solzhenitsyn said, "the global media is in the hands of the perpetrators." How can anyone deny this is true when 95% of the media outlets are owned by 6 multinational conglomerates, not to mention, the problem of interlocking directorates, which concentrates ownership even further. There isn't a visible imposition of the parent firm’s policies, yet there is no doubt that the media very effectively exerts control over public ideas solely in the interest of the global elites. It is not so different from that of a country imposing controls However, detecting how most of the mass media imposes these controls is not as straightforward. Political intervention in its most pervasive form is not open and explicit but is concealed under seemingly apolitical reasons.

Having said that, the only thing that makes sense to me...the only reason the global media would allow the publication of a scandal that appears on the surface to expose the elites, is that the overall benefits to them far outweigh the consequences. They have no problem throwing a few of their own under the bus if the overall result furthers their agenda.

It's the old Hegelian dialectic at work once again. Create--cherry-pick-- a scandal (problem) to create a reaction in order to produce a nefarious solution that on the surface seems as if they're trying to clean up the corruption, increase transparency, address major discrepancy of wealth, etc,. that will do no such thing. All I know for sure is, whatever happens as a result, it will not benefit the 99%.

So I still think the reason has something to do with the implementation of a global tax and surveillance grid...getting more countries to sign on to the Multilateral Competent Authority Agreement (MCAA) in order to, eventually, launch the global tax system.

[seemslikeadream]

“If I were not chief of staff I would definitely be investing here” – offshore in Ukraine

2015-08-31 by armedpolitics

There is little reason to believe that Ukrainian elites stopped using offshore companies in order to avoid governmental regulation of their assets. The acting president and his partners are no good role models in this respect.


Starting with Igor Kononenko, an old business partner of Petro Poroshenko and a leading figure in the party of the president. On August 26, vlada.io published a series of documents that bring him into connection with offshore banking – or depending on the definition into connection with money laundering.

Kononenko’s name appeared a couple of times in the documents, together with Intraco Management Ltd., a company based on British Virgin Islands and Darya Tsaregorodtseva, its financial director. The personal connections that can be concluded from the documents, as well as documented financial transactions and copies of contracts leave little doubt in his involvement in such activities.

Having a complex system of offshore companies is not illegal, but under given circumstances their existence are an indication of tax optimization practices that do not comply with the laws of most countries.

Earlier this year, Valentyn Nalyvaichenko, the recently fired head of the Ukrainian intelligence service (SBU) mentioned in a interview that a leading figure of the Petro Poroshenko Bloc channels half a million USD to offshore accounts every week. It was clear that Kononenko was meant.

Poroshenko’s name didn’t appear in the documents, instead they show connections between Intraco and Geoffrey Magistrate, another old business partner of Poroshenko. Intraco Management Ltd. payed for the fuel costs of Poroshenko’s private jet when he was already president of Ukraine.

A couple of months ago, when Poroshenko published his declaration of income, the press release mentioned that the president pays various financial expenses of his presidency from his own pocket. The fuel for his private jet was mentioned explicitly. (armedpolitics, April 10; the press release is offline)

Boris Lozhkin is another name worth mentioning in this context. He is the chief of staff for the president. He owned a media company and sold it in 2013 for estimated USD 150 millions. The money went into an offshore fund that according to Lozhkin, he has no part in managing. Lozhkin explains: “If I were not chief of staff I would definitely be investing here.” The money of the sale wasn’t included in his declaration of income. (BV, Leonid Bershidsky, June 1st)

A traditional route of Ukrainian (and Russian) offshore money leads via Lithuania to Austria (and Bodensee region). Very dirty money is transferred through holdings based on Cyprus and other islands. After the financial crisis in 2007, the route changes from Cyprus to other places with flexible tax regulations, such as Cayman Islands or Belize.

The flows and stocks of the offshore money appear to some part in the statistics of foreign direct investments (FDI). UNCTAD provides detailed data by country until 2010 and 2012. According to this, the FDI stock of British Virgin Island was higher than investments from the USA or a tenth of investments from Cyprus.

A company which provides offshore solutions for the Ukrainian market explain their services as follows:

Offshore, offshore companies and bank accounts – quick and confidentially as to you dream and for your successful business from UBC Offshore Services. The offshore company is usually managed by Nominee Director and by using the General Power of Attorney, thats why new offshore company could be yours a minimum of time and you always get 100% guaranteed results and confidentiality!

Also for the nationals of the EU, USA, Canada and CIS UBC offers a special business package ready offshore company and bank account in Latvia, Switzerland, Cyprus of Caribean Bank in 2 hours. UBC recommends only best choice offshore jurisdictions: Panama, Seychelles, United Kingdom, Belize, Hong Kong and Cyprus. (UBC, homepage)

Mossack Fonseca reported fake address in Limassol 8
ON APRIL 5, 2016 FEATURED, GENERAL
By Stelios Orphanides and Angelos Anastasiou

Mossack Fonseca, the Panamanian law firm which, according to leaked data, helped powerful politicians, companies, criminals and celebrities open offshore accounts, in order to evade taxes or launder their money, set up a subsidiary in Cyprus, an investigation into the website of the company registrar showed.

In 2003, the Panamanian law firm registered its subsidiary Mossack Fonseca (Cyprus) Ltd on May 26, 2003 with a registration number ΗΕ 138503, according to the company registrar’s website. On February 12, this year, the company filed an application to be struck off.

According to the registrar’s website, the Cyprus unit of Mossack Fonseca was located at 12, Dafnis street in Yergmasogia, a suburb of Limassol, in apartment 104. At the entrance of the building located at that address, called “Psilogeni,” there is no sign indicating that Mossack Fonseca maintains its offices there and several tenants interviewed said they were never aware of a company in their building. In addition, the Psilogeni block of flats has no apartment numbered 104.

The tenants also said that they didn’t know the names of the two directors of Mossack Fonseca (Cyprus) Ltd, Geoffrey Magistrate and Ioannis Despotidis. According to a document on the Mossack Fonseca website, Magistrate is a contact for the Panamanian law firm in Cyprus. The Athens-based auditor firm Despotidis & Associates is run by Ioannis Despotidis, according to the company’s website. Both Magistrate and Despotidis were unavailable for a comment.

Spyros Kokkinos, the head of the department of company registrar and official receiver said that, while the law prescribes that companies have to report their address while filing an application for registration, the registrar does not have the means to double-check whether the data submitted is correct. “It is up to the lawyers, accountants and other service providers to do their work properly,” he said in a telephone interview.

A further online search revealed that a Limassol-based company, Ergoserve which provides corporate and tax services, is working with Mosscack Fonseca. Ergoserve appears to be affiliated with the law firm Clerides, Anastasiou and Neofytou, as well as with audit company Isotax. Ergoserve, Isotax and the Clerides Anastasiou and Neofytou law firm maintain offices in the same building in Chrisoroiatissis & Kolokotroni street in Limassol.

According to Ergoserve’s website, cached by Google on January 22, 2016, Ergoserve is affiliated with Mossack Fonseca.

“And because Ergoserve is affiliated with the Mossack Fonseca Organisation, one of the largest corporate services providers with offices in more than 35 countries, we are able to offer our clients a truly worldwide company incorporation capability,” the Limassol-based company said.

Ergoserve, Isotax, and the Clerides, Anastasiou, and Neophytou law firm, all were unavailable for comment.

HEART OF EMPIRE — August 13, 2015, 11:32 am
Undelivered Goods
How $1.8 billion in aid to Ukraine was funneled to the outposts of the international finance galaxy

By Andrew Cockburn

Arriving home from a recent trip to Ukraine, former Senate majority leader Tom Daschle reported his joy at witnessing “the Ukrainian people . . . coming together to rebuild their country from scratch.” Ukrainians had, he wrote, moved him with their dreams of joining the European Union, fighting corruption, and rebuilding their shattered economy, inspiring Daschle, now a highly paid lobbyist, to endorse the ominously strengthening Washington consensus on escalating the fighting with “$3 billion in lethal and nonlethal military assistance.”

Daschle’s trip was sponsored by the National Democratic Institute, an affiliate of the congressionally funded National Endowment for Democracy, headed by ur-neoconservative Carl Gershman, who some time ago identified Ukraine as “the biggest prize” for Russia and deployed considerable amounts of the taxpayer dollars at his disposal to securing it for the West. However, it has been Assistant Secretary of State Victoria Nuland who has played the most active role in pursuit of the prize. Therefore, her interventions in Ukrainian politics and the realities of politics and business in that country deserve closer attention than they have so far received.

“Toria” Nuland, as I reported in the January 2015 issue of Harper’s Magazine, has enjoyed a remarkable career, occupying a succession of powerful positions through changing administrations, despite her close neocon associations over the years both marital—her husband being leading neocon ideologue Robert Kagan—and political, notably as a national-security adviser to former vice president Dick Cheney. In the buildup to the 2008 Russo-Georgia war, for example, Nuland, at the time ambassador to NATO, urged George Bush to accept both Georgia and Ukraine as NATO members. Since Georgia’s then president and neocon favorite, Mikheil Saakashvili, had high hopes of drawing the United States in on his side in the coming conflict, this was a dangerous initiative. Fortunately, Bush, by that time leery of neocon advice, stood firm against her pleas.

Despite her ongoing proximity to power, Nuland attracted little public attention until the leak of an intercepted phone call gave the rest of us a taste of how she operates. Incautiously chatting on her cell on January 28, 2014, with U.S. Ambassador to Ukraine Geoffrey Pyatt, as the Kiev street protests against elected Ukrainian Viktor Yanukovych gathered momentum, Nuland and the diplomat mulled over who should now rule the country. Their candidate was “Yats,” the opposition politician Aseniy Yatsenyuk, as opposed to another opposition candidate, former world heavyweight boxing champion Vitali Klitschko, favored by various European powers. Nuland was determined to keep Klitschko out and, as she infamously remarked on that call, “fuck the E.U.”

However, despite her enthusiasm for Yatsenyuk, Nuland was clearly well aware of who was really pulling the strings in Ukrainian politics: the oligarchs, who had assembled enormous fortunes out of the wreckage of the Soviet economy. Chief among these were those connected to the import of Russian natural gas, on which Ukraine was heavily dependent, most especially Dmitry Firtash, a multimillionaire and key supporter of the government Nuland hoped to displace. This may explain why, at the end of 2013, Firtash found himself the subject of a U.S. international “wanted” notice, charged with attempting to bribe local officials in distant India. He happened to be in Vienna, and a request was accordingly submitted to the Austrian government for his extradition back to the United States to stand trial.

On the day the request was submitted, Victoria Nuland left Washington on an urgent visit to Ukraine. President Yanukovych appeared to be backtracking on a pledge to sign an association agreement with the European Union— the specific “biggest prize” cited by Gershman in a Washington Post op-ed the month before. If Yanukovych were to be persuaded to change his mind, threatening to put his sponsor Dmitry Firtash behind bars was a potent lever to apply. Four days later, Yanukovych signaled he was ready to sign, whereupon Washington lifted the request to shackle his billionaire ally.

A month later, Yanukovych changed course again, accepting a $15 billion Russian aid package. Street protests in Kiev followed, eagerly endorsed by Nuland, who subsequently distributed cookies in gratitude to the demonstrators. Yanukovych fled Kiev on February 22, and four days later the United States renewed the request to the Austrians to arrest Firtash. They duly did. Briefly imprisoned, Firtash posted the equivalent of $174 million bail and waited for a court to rule on his appeal against extradition.

Nevertheless, Firtash was still politically powerful enough in Ukraine to decide who should become president. The two leading candidates for the post were Petro Poroshenko, a chocolate-industry oligarch favored by Nuland, and Vitaly Klitschko, the boxer she had schemed to exclude from the premiership. Klitschko was very much under Firtash’s control. Both men flew to the Austrian capital for a meeting with the oligarch, who negotiated a deal in which Klitschko stood down and left the way open for Poroshenko, while Klitschko became mayor of Kiev.

Ukraine meanwhile was in chaos. The revolution that had brought anti-Russian nationalists to power in Kiev was highly unwelcome in the Russian-speaking east, not to mention Moscow. Vladimir Putin capitalized on this to engineer the return of Crimea to Russian rule, and it appeared possible that he would similarly absorb eastern Ukraine. By April 2014, Russian-backed separatists had taken control of the Donbass, the steel and mining region, and were advancing westward toward the next big industrial center, Dnipropetrovsk, the domain of another oligarch, Igor Kolomoisky.

Kolomoisky had built his multibillion dollar financial base partly thanks to his mastery of “raiding,” the local version of mergers and acquisitions, involving methods that would make even the most hardened Wall Street financier turn pale. According to Matthew Rojansky, director of the Kennan Institute at the Woodrow Wilson Center for International Scholars, who has made a special study of the practice, “there are actual firms in Ukraine . . . registered with offices and business cards, firms [that specialize in] various dimensions of the corporate raiding process, which includes armed guys to do stuff, forging documents, bribing notaries, bribing judges.”

Rojansky describes Kolomoisky as “the most famous oligarch-raider, accused of having conducted a massive raiding campaign over the roughly ten years up to 2010,” building an empire based on banking, chemicals, energy, media, and metals, and centered on PrivatBank, the country’s largest bank, holding 26 percent of all Ukrainian bank deposits. At some point, Kolomoisky’s business practices raised enough eyebrows in Washington to get him on the visa ban list, precluding his entry into the United States.

In April 2014, as the separatists advanced, Kolomoisky mobilized his workforce into a 20,000-man private army in two battalions, Dnipro-1 and Dnipro-2, and stemmed the tide. According to Wilson Center director Rojansky, Kolomosiky is “perceived as the bulwark and the reason why the whole Novorossiya project [Putin’s plan to absorb most of eastern Ukraine] broke down at the border of the Donbass.”

Stopping Putin in his tracks would clearly have earned the master raider merit in the eyes of policymakers in Washington and other Western capitals, which may just explain how it was that while Firtash was under the shadow of the U.S. indictment, no one made too much of a fuss at the disappearance of an estimated $2 billion in IMF aid for Ukraine that speedily exited the country via Kolomoisky’s PrivatBank.

The international financial agency had rushed the money to Ukraine in April, in response to what IMF managing director Christine Lagarde called a “major crisis.” She went on to hail the government’s “unprecedented resolve” in developing a “bold economic program to secure macroeconomic and financial stability.” Over the next five months the international agency poured the equivalent of $4.51 billion ($2.97 billion in “Special Drawing Rights”—the IMF’s own currency) into the National Bank of Ukraine— the country’s central bank. Much of this money was urgently needed to prop up the local commercial banks. In theory, the IMF appeared to require direct supervision of how the Ukrainian banks used the aid. In fact, it appears the banks got to select their own auditors.

As the largest bank, Kolomoisky’s PrivatBank stood to garner the largest share of the international aid. Published estimates put this share as high as 40 percent. Despite the torrent of cash, the banks’ situation did not improve; nine months into the program, the IMF announced: “As of end January 2015 . . . the banking system’s capital adequacy ratio stood at 13.8 percent, down from 15.9 percent at end-June.” Where had the money gone?

Although we hear much about corruption in countries such as Ukraine in general terms, a precise, detailed accounting of the means by which an impoverished country has been stripped of precious assets is not usually easy to come by. In this case however, thanks to investigative work by the Ukrainian anticorruption watchdog group Nashi Groshi (“Our Money”), we can actually watch the process by which the gigantic sum of $1.8 billion was smoothly maneuvered offshore, in the first instance to PrivatBank accounts in Cyprus, and thence into accounts in Belize, the British Virgin Islands, and other outposts of the international financial galaxy.

The scheme, as revealed in a series of court judgments of the Economic Court of the Dnipropetrovsk region monitored and reported by Nashi Groshi, worked like this: Forty-two Ukrainian firms owned by fifty-four offshore entities registered in Caribbean, American, and Cypriot jurisdictions and linked to or affiliated with the Privat group of companies, took out loans from PrivatBank in Ukraine to the value of $1.8 billion. The firms then ordered goods from six foreign “supplier” companies, three of which were incorporated in the United Kingdom, two in the British Virgin Islands, one in the Caribbean statelet of St. Kitts & Nevis. Payment for the orders—$1.8 billion—was shortly afterwards prepaid into the vendors’ accounts, which were, coincidentally, in the Cyprus branch of PrivatBank. Once the money was sent, the Ukrainian importing companies arranged with PrivatBank Ukraine that their loans be guaranteed by the goods on order.

But the foreign suppliers invariably reported that they could not fulfill the order after all, thus breaking the contracts, but without any effort to return the money. Finally, the Ukrainian companies filed suit, always in the Dnipropetrovsk Economic Court, demanding that that foreign supplier return the prepayment and also that the guarantee to PrivatBank be cancelled. In forty-two out of forty-two such cases the court issued the identical judgment: the advance payment should be returned to the Ukrainian company, but the loan agreement should remain in force.

As a result, the loan of the Ukrainian company remained guaranteed by the undelivered goods, while the chances of returning the advance payments from foreign companies remain remote. “Basically this transaction of $1.8 bill[ion] abroad with the help of fake contracts was simply an asset siphoning [operation] and a violation of currency legislation in general,” explained Lesya Ivanovna, an investigator with Nashi Groshi in an email to me. “The whole lawsuit story was only needed to make it look like the bank itself is not involved in the scheme . . . officially it looks like PrivatBank now owns the products, though in reality [they] will never be delivered.”

Thanks to the need to use the economic court as a legal fig leaf, the scheme operated in plain view. “There were no secret sources,” Ivanovna told me. “We found this story while monitoring the court decisions registrar. It’s open and free to search, so we read it on a daily basis.” Other companies had used the same mechanism, she pointed out. “The major difference of this case is its immensity.”

Despite this brazen raid on Ukraine’s dwindling assets, no one in authority seemed to care very much. Ivanovna’s group joined with an anticorruption NGO, Anti-Corruption Action Center (ANTAC), in a request to the Ukrainian General Prosecutor Office to open a criminal proceeding, but with no result. ANTAC’s legal director, Antonina Volkotrub, tells me that there is currently no official investigation of the transactions, though her group has sued the prosecutor to start a criminal investigation.

Kolomoisky himself has however run into a small spot of bother with authorities. In March of this year he launched his most bold raid yet, sending a hundred armed “lawyers” to seize physical control of Ukrnafta, the principal Ukrainian oil company, and UkrTransNafta, which controls almost all oil pipelines in the country. This was a direct threat to the authority of Poroshenko, the oligarch/president, who enlisted ambassador Pyatt, Nuland’s phone-mate, in a deal to remove his rival from the scene. “My understanding is that part of the deal whereby Kolomoisky gave up his attempt to take over control of Ukrnafta and UkrTransNafta and gave up governorship of Dnipropetrovsk and gave up having his pawn in control of Odessa,” Rojansky told me, “was that the U.S. ambassador came in as an intermediary guarantor and said if you do these things, we will take you off the visa bad list.” So it came to pass. Kolomoisky flew unmolested to the United States, where he is reported to have been spending a lot of time watching basketball games, and with no one asking awkward questions about what happened to all that IMF money. (Nuland’s friend Mikheil Saakashvili, the former president of Georgia who had worked so hard to draw the United States into conflict with Russia, took over the governorship of Odessa, with the United States paying his staff’s salaries.)

As for Firtash, the State Department has been less forgiving. In April this year a Vienna court presided over by Judge Christoph Bauer finally got around to hearing Firtash’s appeal against the extradition request in the Indian bribery case. In a daylong hearing, a crowded courtroom received a fascinating tutorial on the inside story of recent Ukrainian political events, including the background to Washington’s on-again, off-again with the Firtash extradition requests according to the status of Ukraine’s E.U. negotiations, not to mention Firtash’s role in the Poroshenko-Klitschko negotiations. Firtash’s lawyers argued that the case had little to do with bribery in India and everything to do with United States meddling in Ukrainian politics. The judge emphatically agreed, handing down a withering verdict, stating that “America obviously saw Firtash as somebody who was threatening their economic interests.” He also expressed his doubts as to whether two anonymous witnesses cited by the United States in support of its case “even existed.” The State Department announced it was “disappointed” in the verdict and maintained its outstanding warrant for Firtash, should he leave Austria and travel to some country with a legal system more deferential to U.S. demands.

Complex realities such as those related here do not intrude on official Washington pronouncements, where all is black and white, and the party line shifts inexorably closer to endorsing U.S. military engagement in the Ukrainian quagmire. At least we should know who is taking us there.

R. Hunter Biden Should Declare Who Really Owns His New Ukrainian Employer, Burisma Holdings
Posted on May 21, 2014 by Richard Smith
Here’s last week’s big announcement, adorned by a photograph of an American with a faintly alarming rictus; oh yes, oh dear me, yes: Hunter Biden joins the team of Burisma Holdings:

Burisma Holdings, Ukraine’s largest private gas producer, has expanded its Board of Directors by bringing on Mr. R Hunter Biden as a new director.

R. Hunter Biden will be in charge of the Holdings’ legal unit and will provide support for the Company among international organizations. On his new appointment, he commented: “Burisma’s track record of innovations and industry leadership in the field of natural gas means that it can be a strong driver of a strong economy in Ukraine. As a new member of the Board, I believe that my assistance in consulting the Company on matters of transparency, corporate governance and responsibility, international expansion and other priorities will contribute to the economy and benefit the people of Ukraine.”

There you have to folks, a massive web of war, corruption, money laundering, international finance and deception with the son of the US Vice president employed by a Cyprus based Holding company owned by Ukraine's most villainous and murderous oligarchs who is implicated in the theft of billions of IMF dollars

[seemslikeadream]

David Cameron: third off-shore investment fund linked to father


https://www.youtube.com/watch?v=AM0EsnJ3LKw

[seemslikeadream]

How a US president and JP Morgan made Panama: and turned it into a tax haven
In 1903 the US bullied Colombia into giving up the province that became Panama. The plan was to create a nation to serve the interests of Wall Street

Ed Vulliamy
Saturday 9 April 2016 19.23 EDT

This goes back a long way. The Panamanian state was originally created to function on behalf of the rich and self-seeking of this world – or rather their antecedents in America – when the 20th century was barely born.

Panama was created by the United States for purely selfish commercial reasons, right on that historical hinge between the imminent demise of Britain as the great global empire, and the rise of the new American imperium.

The writer Ken Silverstein put it with estimable simplicity in an article for Vice magazine two years ago: “In 1903, the administration of Theodore Roosevelt created the country after bullying Colombia into handing over what was then the province of Panama. Roosevelt acted at the behest of various banking groups, among them JP Morgan & Co, which was appointed as the country’s ‘fiscal agent’ in charge of managing $10m in aid that the US had rushed down to the new nation.”

The reason, of course, was to gain access to, and control of, the canal across the Panamanian isthmus that would open in 1914 to connect the world’s two great oceans, and the commerce that sailed them.

The Panamanian elite had learned early that their future lay more lucratively in accommodating the far-off rich than in being part of South America. Annuities paid by the Panama Railroad Company sent more into the Colombian exchequer than Panama ever got back from Bogotá, and it is likely that the province would have seceded anyway – had not a treaty been signed in September 1902 for the Americans to construct a canal under terms that, as the country’s leading historian in English, David Bushnell, writes, “accurately reflected the weak bargaining position of the Colombian negotiator”.

Colombia was, at the time, riven by what it calls the “thousand-day war” between its Liberal and Historical Conservative parties. Panama was one of the battlefields for the war’s later stages.

The canal treaty was closely followed by the “Panamanian revolution”, which was led by a French promoter of the canal and backed by what Bushnell calls “the evident complicity of the United States” – and was aided by the fact that the terms of the canal treaty forbade Colombian troops from landing to suppress it, lest they disturb the free transit of goods.

The Roosevelt/JP Morgan connection in the setting-up of the new state was a direct one. The Americans’ paperwork was done by a Republican party lawyer close to the administration, William Cromwell, who acted as legal counsel for JP Morgan.

JP Morgan led the American banks in gradually turning Panama into a financial centre – and a haven for tax evasion and money laundering – as well as a passage for shipping, with which these practices were at first entwined when Panama began to register foreign ships to carry fuel for the Standard Oil company in order for the corporation to avoid US tax liabilities.

On the slipstream of Standard Oil’s wheeze, Panama began to develop its labyrinthine system of tax-free incorporation – especially with regard to the shipping registry – with help and guidance from Wall Street, just as the US and Europe plunged into the Great Depression. The register, for example, welcomed US passenger ships happy to serve alcohol during prohibition.

President Roosevelt sits in an American steam-shovel at Culebra Cut, on the Panama Canal in 1906.
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President Roosevelt sits in an American steam-shovel at Culebra Cut, on the Panama Canal in 1906. Photograph: Alamy
In his seminal book on offshore jurisdictions, Treasure Islands, Nicholas Shaxson cites a letter from US treasury secretary Henry Morgenthau protesting to Theodore Roosevelt’s very different namesake, Franklin D Roosevelt, about “conditions so serious that immediate action is called for”. He complains about tax evaders resorting to “all sorts of devices” in places where “taxes are low and corporation laws lax”, citing Panama and the Bahamas.

Shaxson’s book then traces America’s shedding of any reticence to hide money: “While this offshore expansion accelerated, the erosion of America from the inside gathered pace.”

So, by the 1970s, when the US government had tightened its tax evasion loopholes, Panama went into the kind of full service we saw last week. Banking deposits soared, from small beginnings in 1970 to $50bn in 1980, according to the Tax Justice Network. And that was just the beginning, the small change.

At the same time, two treaties were signed in 1977: one that gave the US military carte blanche to defend the canal, another agreeing to hand the waterway to Panamanian sovereignty in 1999.

In 1983, however, the system backfired slightly: General Manuel Noriega took power. For years, he had been a beneficiary of, and functionary for, the CIA, but he came to realise that Panama’s wealth was even better suited to an alliance with the Medellín narco-trafficking cartel of Pablo Escobar. In 1989, therefore, the US returned militarily, as it had eight decades previously, and – as Silverstein puts it – “returned to power the old banking elites, heirs of the JP Morgan legacy”.

Recollections from the period in a book called The Infiltrator by Robert Mazur, who worked his way into Escobar’s cartel to successfully prosecute the BCCI bank that handled much of his money, are remarkable. Discussing the haven with BCCI official Amjad Awan, Awan tells Mazur: “Well, put it this way. In Panama, we have no qualms about doing anything because the laws of the land allow us to do it. Anyone can walk in and deposit $10m in cash – fine. We take it. That’s the business we’re in.”

Awan names major American banks that still dominate Wall Street, adding: “We do it in probably a smaller way, but every bank does it.”

Although “Panama is one of the world’s sleaziest tax havens, it is just part of a bigger global system”, says Shaxson. “The United Kingdom runs a global network of overseas territories and crown dependencies that includes some of the world’s biggest tax havens.”

John Christensen, director of the Tax Justice Network, says: “It’s important to recognise that offshore law firms like Mossack Fonseca do not operate in isolation; they rely on intermediaries, often other law firms or banks, to pass on clients and to provide support for the sophisticated cross-border structures.”

History has its way of coming ironically around, and it certainly has in the early 21st century on two counts, echoing Panama’s genesis.

One is that the man who became president of Standard Oil back in those early days of tax dodging – William Stamps Farish II – had a grandson, William Farish III, who became a crucial aide and lieutenant to the Bush dynasty; he was “almost like family”, said Barbara Bush, and became her son George W Bush’s ambassador to London. (JP Morgan has meanwhile hired a string of illustrious ambassadors and consultants of late, few more prestigious than Bush’s closest ally, Tony Blair.)

Then there’s this: among the factors that made it so easy for the 20th century’s new imperium to browbeat Colombia into ceding the Panama canal was the fact that had Panama not got the canal, Nicaragua would have stepped up. Now, a century later, Nicaragua is about to get one too, paid for and controlled by the power that would fain step into America’s imperial boots – China.

[smiths]

More thought ...

April 3rd 2016 - Panama Papers are injected into the global media consciousness

so why then? the anglo-saxon media alliance self-declared that they had had them for a year, so why that day for the release?

and really, a year to research and build stories, why so few actual stories?

having had a good look at the Icelandic angle this morning, the thing that strikes me is that the timing was absolutely stunning for toppling the Icelandic PM

Panama Leak Leaves Icelandic PM in Deep Trouble
Published April 03, 2016 22:49

[The Panama Pares leak has revealed] "detailed information about a company owned by Iceland’s Prime Minister Sigmundur Davíð Gunnlaugsson and his wife Anna Sigurlaug Pálsdóttir."
The information was revealed on TV news analysis program Kastljós on national broadcaster RÚV tonight [April 3rd], which focused its coverage on the connection Icelandic politicians have to tax havens.
Coverage of the Panama Papers was published simultaneously by the participating media this evening.
On March 11, a Swedish investigative journalist, Sven Bergman from the Uppdrag granskning news program, intervieved Sigmundur and asked him directly whether he had any connections to an offshore company.
Sigmundur’s wife revealed the existence of the company Wintris Inc. in a Facebook post on March 15.
... the journalist asked him directly about Wintris Inc., at which point the PM became defensive, saying it sounded like the journalist was accusing him of something. At that point, Icelandic journalist Jóhannes Kr. Kristjánsson stepped into the interview and asked the prime minister why he had kept the company secret from the nation
The scandal has caused great controversy in Iceland
Tomorrow [Tuesday 4th] at 5 pm, a protest is planned on Austurvöllur square, in front of the Alþingishús parliament building. Organizers of the event claim the government has no mandate and they demand parliamentary elections. Close to six thousand people have reported they’re going to the event.
Meanwhile, almost 18,000 people have now signed a petition, telling Sigmundur he is fired from his post as prime minister, while 1,000 voters have signed a petition in his support.
http://icelandreview.com/news/2016/04/0 ... ep-trouble

“Iceland is in for another storm”
Sun 3 Apr 2016 | 22.55 GMT
http://icelandmonitor.mbl.is/news/polit ... her_storm/

Iceland’s government hangs by a thread this evening as opposition parties prepare to bring an official motion of no confidence against it when parliament reconvenes after the Easter break tomorrow.
“There is nothing else for it after this evening’s revelations,” says Pirate Party MP Birgitta Jónsdóttir.
She is referring to a special edition of Iceland’s Kastljós current affairs discussion programme (link in Icelandic) dealing with this evening’s publication of the ‘Panama Papers’, a collection of millions of documents leaked from a Panamanian law film showing how influential people have exploited tax havens.
The list of those connected with offshore companies – with the alleged intention of hiding their assets – includes the Iceland Prime Minister Sigmundur Davíð Gunnlaugsson and two cabinet ministers. This evening’s Kastljós exposé has rocked Icelandic society, generating fury and disbelief on social media.

The Icelandic PM was in trouble, the journalists were on his case about corruption having obviously been given the facts they needed

The broadcast of the that Current Affairs program (3rd April) and the massive call to protest through Facebook for the following evening (4th April) sank the government

and then there is Cameron, definitely wounded and diminished by the rehashing of corruption allegations

these 2 are the principle victims so far, so why? and why now if they all had the info for a year?

[JackRiddler]

You are assuming there is a why Cameron, why Iceland, yet we don't even know the most important who - as in, who leaked the MF files? It can easily be the case that the motivation was not Cameron, let alone Iceland. Speculation is useless, but the most obvious loser in the leak is (drumroll please) MF itself, which probably won't survive this. So it can be as simple as an insider who wanted revenge, or who was disgusted by what (s)he was seeing generally and thought to shake things up - that was the story with Manning and Snowden, was it not? But I'm not backing that. We are in unknown unknown territory. How the consortium will respond is predictable, at least at first. Now that hundreds of people in many countries and publications have access, don't be so sure. But who says the leaker was even thinking about that? Maybe they/he/she just imagined it was the way to get maximum impact.

[82_28]

Population of Iceland is around 323,000 peeps. Easy peasy to knock him off.

[smiths]

"an insider who wanted revenge, or who was disgusted by what (s)he was seeing generally and thought to shake things up"

an insider, working at the very core of the corrupt global system who became disgusted with the business? i doubt that

i understand your position on this Jack, yes, its possible it really was just a whistle blower, and there were no tactics or agendas for this leaker other than stated

but the moment the data arrived in the hands of a 'group' of well placed journos in powerful western news agencies that changed

why a German paper? why a network of journos? too many whys?

[Harvey]

Questions outside the material already covered:

Timing: What else has been going on lately...?

Why is Obama flying to Europe this month? (There's lot's happening here in the aftermath of Brussels, there's also Britain in or out, oh and then there's the importance of forcing TTIP upon Europe.)

What deals were made in the last year between journalists (read publishers) and other power brokers?

Targeting Cameron as intentional? - - - - From that perspective, it looks more like the pig whisperer is being unceremoniously offloaded.



Heartening to see Picketty suggesting (admittedly impossible) potential solutions. The left needs to fill this credibility vacuum and yesterday.

MSM has very low currency just now, whatever they've gained through exclusivity, they're probably going to lose through moral defeat. Another vacuum.

Why weren't the papers released through WikiLeaks? Contradictory statements exist whether wikileaks has them or not, does it still exist?

[smiths]

^ where does that genius photo come from?

[smiths]

The Panama papers are not about tax
The Panama papers are, most importantly, about secrecy, and . . . hiding: hiding drugs money, hiding money from spouses, hiding from angry creditors, hiding from Mafia-hunting police, and of course hiding from tax too. It is a more general story about wealthy, law avoiding folk and “tax havens”
http://www.taxjustice.net/2016/04/11/th ... about-tax/

The 1% hide their money offshore – then use it to corrupt our democracy
... the Panama Papers are not about tax. They’re not even about money. What the Panama Papers really depict is the corruption of our democracy.
Following on from LuxLeaks, the Panama Papers confirm that the super-rich have effectively exited the economic system the rest of us have to live in. Thirty years of runaway incomes for those at the top, and the full armoury of expensive financial sophistication, mean they no longer play by the same rules the rest of us have to follow. Tax havens are simply one reflection of that reality.
http://www.theguardian.com/news/comment ... CMP=twt_gu

The Panama Papers told us what we already knew. How we respond will be the story
“A healthy social system would mark this moment as a historical turning point,” writes Fredrik Deboer. “But this is not a healthy social system, and most of the people living within it know that, and so few of us can muster much in the way of righteous indignation.”
... Each time the powerful successfully stare down public outrage, a precedent gets set. Every demonstration of impunity sets the stage for the one that follows. Like laboratory subjects, we learn that nothing can be done, that the world cannot be altered.
“For some,” says Deboer, “reading about the Panama Papers will feel like being told by your parents that Santa isn’t real: merely the final confirmation of a suspicion that you have harbored for a very long time. The game is rigged, and unless you are part of the global one percent, it isn’t rigged to help you.”
The problem’s not that such people don’t realise there’s something wrong. The problem’s that they’ve been convinced by prior experience (all those shocks!) that they can do nothing to change that wrongness.
The Panama Papers have stripped away the layer of opaque smarm through which wealthy and powerful usually obscure their activities. The statesman feathers his own nest; the advocate of austerity enriches herself beyond measure; the great patriot plunders the national treasury and sends it offshore.
But the problem isn’t knowledge. The problem is power.
The 1% hide their money offshore – then use it to corrupt our democracy
“Ye shall know the truth and the truth shall make you free,” promises the Book of John. That might hold for the Kingdom of Heaven but down here on earth matters work rather differently. Truth, in and of itself, doesn’t bring freedom. On the contrary, there’s nothing more demoralising than understanding how the world works and simultaneously feeling you can do nothing to change it.
http://www.theguardian.com/commentisfre ... -the-story

[Harvey]

^ where does that genius photo come from?

It's a shopped photo montage and very well done, other than that I don't know.

Edit: Maybe not, how wonderful!