PHOTO: J. SCOTT APPLEWHITE/AP
http://www.wsj.com/articles/ubs-deal-shows-clintons-complicated-ties-1438223492
An eyebrow-raising article in the Wall Street Journal reveals details of secret 2009 negotiations between then Secretary of State, Hillary Clinton, Swiss Foreign Minister Micheline Calmy-Rey (pictured above with Clinton on July 31, 2009) and Swiss banking giant UBS AG. The article reports that Clinton personally intervened in the massive lawsuit launched in 2007 by the IRS to obtain the identities of Americans with secret bank accounts at UBS. Ultimately, only 4,450 accounts were turned over to the IRS of the 52,000 originally sought by the agency. Coincidentally, UBS contributions to the Clinton family’s charitable Clinton Foundation increased tenfold over the next few years while Bill Clinton’s top source of corporate income for his paid speeches was UBS Wealth Management.
The UBS case, of course, is widely considered to be the primary catalyst for the introduction of FATCA legislation in early 2010, and the subsequent IRS crusade against Americans overseas. While it is too early to ascertain how Clinton’s involvement with UBS may have influenced the final drafting and implementation of FATCA legislation, it certainly renews speculation about exactly how and why overseas residents became swept-up in an IRS effort that was supposedly aimed exclusively at suspected tax cheats living in the US.
Fair to conclude that this story is just beginning to unfold. It could take quite a while to unravel all the quid pro quos in this one.
Additional coverage here:
It doesn’t make sense. Why should Hilary protect 52000 clients for 4500, and then back up on it for FATCA which would reveal the rest anyway? Banks often ask prominent people to come and give talks and pay for it. UBS would have asked a Clinton anyway. They consider it a real prize if they can get a former US president to give a talk.
Maybe 4,500 clients didn’t give campaign contributions or speaking fees or donations to the charitable foundation. Maybe the other 47,500 were given due warning to move their accounts to non-IGA countries. Yah, 47,500 out of 8 million is pretty close to 1%. 1% genuine tax evaders, 99% innocent victims.
I’m sure the 4450 names released were probably middle class people while the uber rich gets notification and avoided being reported.
Good luck in court today.
From the Atlantic article about the pay walled WSJ article. I hope Democrats Abroad would take note:
“Democrats are hurtling toward a farce. The coalition that insists on the corrupting effect of Citizens United and the unlimited campaign contributions it permits is poised to nominate a couple that has seen riches flow from big banks to their personal accounts.”
http://www.theatlantic.com/politics/archive/2015/07/hillary-helps-a-bankand-then-it-pays-bill-15-million-in-speaking-fees/400067/
From AccountingToday today: http://www.accountingtoday.com/news/tax-practice/hillary-and-bill-clinton-release-8-years-of-tax-returns-75392-1.html?utm_medium=email&ET=webcpa%3Ae4879083%3A2531408a%3A&utm_source=newsletter&utm_campaign=daily-aug%204%202015&st=email
What a stench.
I don’t think I can handle those pantsuits for four years.
That saffron thing in the picture looks like Mao Zedong meets Dalai Lama.
At least one of their LLCs is registered in Delaware. Why is that?
VP Biden’s state of Delaware has been referred to as; “…in some ways the biggest corporate haven of all…”
http://www.nytimes.com/2012/07/01/business/how-delaware-thrives-as-a-corporate-tax-haven.html?_r=0
‘How Delaware Thrives as a Corporate Tax Haven’ By LESLIE WAYNE JUNE 30, 2012
“…In these troubled economic times, when many states are desperate for tax dollars, Delaware stands out in sharp relief. The First State, land of DuPont, broiler chickens and, as it happens, Vice President Joseph R. Biden Jr., increasingly resembles a freewheeling offshore haven, right on America’s shores. Officials in other states complain that Delaware’s cozy corporate setup robs their states of billions of tax dollars. Officials in the Cayman Islands, a favorite Caribbean haunt of secretive hedge funds, say Delaware is today playing faster and looser than the offshore jurisdictions that raise hackles in Washington.
And international bodies, most recently the World Bank, are increasingly pointing fingers at the state.
Of course, business — the legal kind — has been the business of Delaware since 1792, when the state established its Court of Chancery to handle business affairs. By the early 20th century, the state was writing friendly corporate and tax laws to lure companies from New York, New Jersey and elsewhere. Most of the businesses incorporated here are legitimate and many are using all legal means to reduce their tax bills — something that most stockholders applaud.
President Obama has criticized outposts like the Caymans, complaining that they harbor giant tax schemes. But here in Wilmington, just over 100 miles from Washington, is in some ways the biggest corporate haven of all. It takes less than an hour to incorporate a company in Delaware, and the state is so eager to attract businesses that the office of its secretary of state stays open until midnight Monday through Thursday — and until 10:30 p.m. on Friday.
Nearly half of all public corporations in the United States are incorporated in Delaware. Last year, 133,297 businesses set up here. And, at last count, Delaware had more corporate entities, public and private, than people — 945,326 to 897,934…..”…
…..”.Delaware’s tax laws are a bonanza for the state. At a time when many states are being squeezed by a difficult economy, Delaware collected roughly $860 million in taxes and fees from its absentee corporate residents in 2011. That money accounted for a quarter of the state’s total budget…”…..
About Delaware (and the USA) as a tax haven:
http://www.worldpolicy.org/journal/spring2015/tax-haven
‘The Next Rising Tax Haven’
By Andres Knobel
“UNITED STATES OF HYPOCRISY
While Switzerland hides behind myths and shenanigans, the United States is crystal clear—and this is where the future unknown may be paramount in tax and banking concealment. Despite protests to the contrary, the United States is eager to become the top tax haven in the world. What about all that monitoring and pointing fingers about money laundering, finance of terrorism, and tax evasion? They are still valid—as long as they apply only to everyone else.
People who accuse the United States usually think the problem concerns a single state. As The Guardian portrayed it, “A wedge-shaped chunk of land 96 miles long sitting halfway between Washington and New York, the state of Delaware is home to 870,000 people, 0.3 percent of the U.S. population. But more than half of the nation’s publicly traded companies are incorporated here, including 60 percent of the Fortune 500 firms. One anonymous office block serves as the registered address of more than 200,000 corporations.” Remember Ugland House in the Cayman Islands? This is more than 16 times the number of Cayman registered entities.
While American companies are condemned at home for their aggressive tax planning schemes—their operations abroad in Ireland and the like—the United States seems to be defending those very same companies against the OECD’s BEPS process, which tries to curb tax avoidance and evasion by multinational companies. Although this seems contradictory, there is some logic to it. The United States only cares about American companies paying taxes to the American treasury. It has little interest in helping other countries achieve the same result.
Regarding banking secrecy, the United States is even more straightforward with its double standard. Washington enacted FATCA rules to oblige foreign banks to send the IRS information about Americans holding bank accounts abroad. It also imposed a 30 percent withholding tax against any financial institution in the world which failed to participate or remained non-compliant with FATCA’s reporting obligations. It had little concern for all the businesses’ costs and domestic legal changes every other country had to undertake to allow its banks to provide this information to the United States. But when other countries, such as Germany, showed interest in receiving information about their own residents with accounts in American banks, the United States offered instead only basic and partial reciprocity. The United States would report information about fewer types of accounts, cover fewer types of income, and most importantly, there would be no look-through provisions to identify (German) individuals trying to avoid reporting by hiding behind some company or trust. In some agreements, the United States did commit to achieving equal levels of reciprocity, but cleverly forgot to set a timeframe for such conformity. Some smaller countries, in fact, were only offered the Hobson’s choice of providing all requested information to the United States or being subject to the confiscatory withholding tax.
FATCA then inspired the OECD’s own standard on automatic exchanges of financial account information, called the Common Reporting Standard or CRS, which was basically an adapted copy of FATCA, though carrying no sanctions. Given their similarities, many were led to believe that the United States would also commit to the CRS so that eventually all countries applied only one standard. To make the offer even more tempting, the CRS allowed special provisions in favor of American banks—and this despite Swiss bank opposition.
But Washington saw an opportunity it couldn’t afford to pass up. It decided instead simply and exclusively to apply FATCA. This way, while all countries would have to exchange information with each other pursuant to the CRS, and send information to the United States under FATCA, the United States need not fully reciprocate to anyone. This way it could offer foreigners the option to open accounts in American banks as a way to limit the disclosure of information to their own authorities. It was a classic tax haven service, but only available in the United States. Though not widely recognized, with an enormous dose of irony, it would appear that by stealth, the United States is quietly en route to becoming the next big unknown—or barely known—among international tax havens.
And there’s a cherry on top. As if Delaware’s anonymous corporate registration process and U.S. banking secrecy weren’t enough, such American flag territories as Puerto Rico or the U.S. Virgin Islands offer an entirely tax free environment. Why go anywhere else?…..”..
http://www.sciencedirect.com/science/article/pii/S0304405X13000056
‘Exploring the role Delaware plays as a domestic tax haven’
by Scott D. Dyrenga, , Bradley P. Lindseyb, , , Jacob R. Thornockc,
http://www.theguardian.com/business/2009/nov/01/delaware-leading-tax-haven
‘Delaware – a black hole in the heart of America;
The US state has been named the world’s most opaque jurisdiction in a major new survey of financial secrecy’
Then there is the US Virgin Islands:
http://www.newsweek.com/2014/09/19/made-america-offshore-tax-haven-269135.html
‘A Made-in-America Offshore Tax Haven’
By Lynnley Browning / September 9, 2014 6:53 AM EDT
“The United States only cares about American companies paying taxes to the American treasury. It has little interest in helping other countries achieve the same result.”
Sure it does. The United States cares about American companies paying taxes to the American treasury, AND it has a big interest in helping other countries achieve forcing their companies to pay taxes to the American treasury.
Oops, wait. What? Companies? Not people? Even though companies are people too, something got confused here. The United States cares about American companies sheltering from all countries’ taxes and sitting on untaxed profits, and helping other countries achieve the same result. People are the ones that the United States cares about making them pay taxes to the American treasury, and has a big interest in forcing other countries to force their people to pay taxes to the American treasury.