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Tax havens lose their veneer

OB-LM593_high_t_CV_20101222145847By Christopher M. Matthews From Wall Street Journal

European countries seem to have decided that is no longer cool to be a tax haven. In a letter last week to Sen. Carl Levin, D-Mich., chairman of the Senate Permanent Subcommittee on Investigations, and Sen. John McCain, R-Ariz., the subcommittee’s ranking member, the Irish ambassador to the U.S. bristled at Ireland being labelled a “tax haven” during the committee’s recent hearing on the tax practices of Apple Inc. “[T]he memorandum refers to Ireland as a “tax haven,” Ambassador Michael Collins wrote. “As you will be aware, the OECD has identified for key indicators of a tax haven. None of these criteria applies to Ireland.”

For years, many European countries were more than happy to accept untaxed monies of foreign companies and individuals and let them hide the funds in private bank accounts. But now that the U.S. and others have started cracking down on tax evasion, and calling out countries, and caches of offshore banking records were leaked, the dynamic has changed. The prime minister of Luxembourg, long seen as a tax haven, summed it up in remarks to Parliament in April when he explained why Luxembourg had decided to start sharing bank information with foreign tax authorities after years of resistance.

“Nothing is as it was before,” Prime Minister Jean-Claude Juncker said. “Not everything has changed, but lots of things have changed. Other changes are necessary, or everything will change.”

As the New York Times reported, Luxembourg isn’t alone. Switzerland, Austria, Ireland, the Cayman Islands, Turks and Caicos Islands, and other British territories in the Caribbean have all to varying degrees indicated they may consider lifting the veil of bank secrecy. And that issue was the focus of a European Union summit meeting in Brussels last month. For its own part, the U.S. has done little to address incorporation laws in places like Delaware, that allow some states to essentially function as tax havens. That didn’t stop Sens. Levin and McCain from calling out Ireland.


US adds Nusra Front to Al Qaeda sanctions list The United Nations Security Council added the Nusra Front to its list of aliases for al Qaeda in Iraq, subjecting the Syrian group to a global asset freeze, travel ban and arms embargo. The U.N. move was taken by the Security Council’s al Qaeda sanctions committee, which maintains all sanctions imposed under Resolution 1267.

US uses Iran sanctions evader authority for first time The U.S. said Friday it used a variety of measures to increase its sanctions on Iran, including one authority used for the first time. The U.S. Treasury Department said that it and the State Department placed sanctions on Cyprus and Ukraine-based Ferland Company Ltd. for facilitating deceptive transactions on behalf of the National Iranian Tanker Co., which was named in July 2012 as an entity of Iran’s government.

Investor groups back conflict minerals law Investor groups with nearly $459 billion in assets under management released a statement expressing support for the section of the Dodd-Frank Act requiring companies to disclose whether they use minerals from the Republic of Congo region. The statement from the more than 50 groups refutes the objections made by the U.S. Chamber of Commerce, National Association of Manufacturers and the Business Roundtable, which have sued the SEC to have the final rule of Section 1502 overturned.

President places reputed steroid dealer, five others under sanctions. President Barack Obama sent a letter to Congress that named six individuals and groups, including an alleged anabolic steroid dealer, under Kingpin Act sanctions. The letter merely names the people designated for sanctions, but an email on Friday from a Treasury spokesman explained why each person or group received the sanctions.

U.S. seizes house of allegedly corrupt Nigerian official A federal judge approved the U.S. Justice Department’s forfeiture order against a Maryland house belonging to an allegedly corrupt former Nigerian governor. The forfeiture on the $700,000 Rockville, Md., house was executed Friday after U.S District Judge Roger W. Titus granted the Justice Department’s motion for default judgment against the property. The Justice Department said the house belonged to Diepreye Peter Solomon Alamieyeseigha, governor of Nigeria’s oil-producing Bayelsa state, from 1999 to 2005.

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