Monday Morning: Welcome to BVI – Have a Tax-Free Day

Aw, shucks. Spring Break is over just as I find another warm place to visit. The British Virgin Islands expect a balmy daytime high of 84F/29C degrees today with partly cloudy skies.

And a 100% chance of tax havens galore.

Blood’s in the water, though, stay ashore. You may hear a lot in the media today about the Panama Papers leak dump in which the BVI feature prominently. What you won’t hear much about: this is the second leak about tax havens in exactly three years.

Jack-doodly-squat happened after the first one in April 2013.

The UK’s PM David Cameron was pressed in 2013 to do something about BVI’s tax laws. He said he would work with the G8 to tackle tax evasion. Of course, we now know why he sat on his hands; he had highly-rewarding and substantial familial interest in doing nothing but continue his family’s tax avoidance scheme. And yet he still managed to get reelected last year, the corrupt pig fucker.

If governments had felt any pressure at all to do something corrective, there wouldn’t be a second wave of leaks, right? But the 1% have continued to milk profits from businesses, transfer the money offshore, and buy themselves enough politicians and corporate media to ensure things remained nice and cozy.

Color me skeptical that anything will come of investigations into tax shelters which are for the most part legal, thanks to pwned and compromised governance. But the unfolding story sheds new light on older ones.

Like the decade-plus work on tax havens and abusive tax schemes by the U.S. of Permanent Senate Committee on Investigations, which did not slow or stop the offshoring of capital. B-schools continue to teach offshore tax shelters as ‘A Good Thing’, right alongside ‘Taxes Are Bad’ — because the 1% have amassed enough money to make sure legislators and B-schools’ leadership stay bought.

How much do the Panama Papers leak materials overlap with the Swiss Leaks scandal, including India’s investigation into HSBC, money laundering and influence peddling, reaching into the UK and beyond?

Or a more recent story about hacked elections, including Argentina’s. Has laundered money acquired the services necessary to manipulate elections in order to ensure nothing would change in tax laws?

Perhaps the Panama Papers will offer a more cohesive picture of just how badly the 99% are being screwed, if nothing else.

Nothing else, that is, besides the No Confidence vote Iceland’s Prime Minister Sigmundur David Gunnlaugsson now faces after the Panama Papers revealed his financial interests in BVI.

It’s actually rather quiet on the technology front as I write this. I’ll add a few snippets later after caffeination.

16 replies
  1. bevin says:

    “…. At this page on the International Consortium of Investigative Journalists website, they list all the country leaders, other government officials, ex-officials, and their relative and associates who are implicated in the leaked documents:

    “You can list these individuals by their home country. Guess what? There’s nobody from the US. Not one. Individuals from over 50 countries are named, but nobody from the United States.

    “Are we really supposed to believe that in those 11.5 million files covering almost 40 years, not a single American government official, ex-official, corporate executive, or any of their friends or family members has used Mossack Fonseca? What a joke this is…”

    This is from a comment on Craig Murray’s blog. This ‘story’ seems to get curiouser and curioser.

  2. Betty says:

    And while Congress passes laws and the NSA spies, the millions keep flowing where they will, and the little people are harassed. Same old, same old.

  3. Bardi says:

    bevin : As usual, you get to the heart of the matter.

    Past time to slash all the 1% mattresses and return the money, no matter how gained, to the people.

  4. lefty665 says:

    “Has laundered money acquired the services necessary to manipulate elections in order to ensure nothing would change in tax laws?”
    Certainly what Hillary’s campaign is “banking” on. Everything is going so well and arranged so nicely you wouldn’t want to change things for the fat cats. Oh, and for the other 99% of you, STFU, prepare for the coronation, and no you can’t have “more” no matter how nicely you ask for it.

  5. Jay says:

    It’s disappointing they’d choose Iceland to pick on, what with that country’s successful prosecution of bankers after the economic crisis. Given the current climate, it’s surprising they didn’t go after Putin in a more thoroughgoing manner. Glad to see Cameron’s dirty linens in there though. Makes you wonder what the bigger fish are hiding with other law firms.

    • Bardi says:

      Jay : “they’d choose Iceland to pick on, what with that country’s successful prosecution of bankers after the economic crisis.”

      Could the Guardian be a banker tool to get back at Iceland because they were one of the few nations to actually persecute the banker criminals?

  6. Rayne says:

    bevin (8:12) — Meh. Murray has his own hot buttons.

    There are 617 U.S. intermediary firms involved. There will be coverage, but will U.S. laws protect any further digging into those intermediaries?

    If as reported MossFon wiped “phones and computers wiped to protect itself from a US District Court action,” we may already have an active case on U.S. soil through which more information can be obtained.

    Süddeutsche Zeitung says there’s more to come, when asked about U.S. I’m just gonna’ wait.

    I think it’s important for the narrative to note how offshoring money has hurt the U.S., creating the conditions encouraging the rise of a certain GOP presidential candidate. The mounting anger after 2008 was in no small part fed by resentment over growing inequality and reduced opportunity.

    Because the current tax system rewards offshoring money *before* it pays taxes, there’s little to invest in public safety nets. There’s also insufficient cash left to spend on increasing wages, which in turn would spur demand. What cash returns is quickly plowed into investments like real estate, which do not create jobs but instead drive up real estate prices and rents. The inequality only deepens as the average Joe can’t amass savings.

    • bevin says:

      I wasn’t attributing that comment to Murray. It came from one of the comments underneath the piece. And, as you suggest, it seems to be inaccurate.
      The reality is that neo-liberalism is almost founded on the belief that the wealthy should hide their assets from tax collectors. In almost every country the race to the bottom of income and corporate tax rate lowering is proceeding. At the same time debt-incurred in the name of the population- and regressive consumption taxes are used to raise public revenues.
      Panama is what the de-regulators who brought us London’s Big Bang and Wall St sponsored catch up legislation in Congress are all modeled on.

  7. Rayne says:

    Jay (9:22) — I can’t look at this as “picking on Iceland.” Iceland is not at all happy with this situation; they’re a much more equal society than we are in U.S., and their response reveals a different cultural attitude about the facts disclosed by the Panama Papers.

    If anything, it’s important that Iceland’s exposure is seen widely, along with their reaction. This is the way an open democratic society is supposed to respond to corrupt behavior, even the appearance of corrupt behavior. Now watch which countries do not similarly respond in a timely manner.

  8. Rayne says:

    bevin (10:03) — That comment mirrored Murray’s point, which was the lack of U.S. individuals/entities named was linked to ICIJ’s funding by U.S. corporations+Soros.

    What I want to know is whether any U.S. media are going to pick up the stick and take it to Congress, and ask them why they haven’t done more to deal with both the Permanent Senate Committee on Investigation’s work on tax havens and on inequality. This stuff’s been sitting around for over a decade, and virtually no action taken. We’d had to wait for a leak before it became a topic again. Clearly the U.S. has been spying on entities with exposure but done little to nothing with it to improve U.S. *economic* security.

    Which brings up a question for a certain former Secretary of State, who sure should have known much of this crap in the Panama Papers: what, if anything at all, did she do to eliminate these shelters? What, if anything will she commit to doing as POTUS (and this same question to each of the other candidates as well)?

    • RUKidding says:

      You raise the same questions I have, but I surely cannot see the USA M$M doing much of anything in re to pushing Congress to anything about anything, much less about really looking into Tax Havens. Why would they? The USA M$M is owned by the same people benefitting from tax havens and avoiding taxes like the plague. The Senate is in thrall to the .001% or via their own chicanery are members of at least the .01%, themselves, and they probably off-shore the money, too.
      Where’s the corporate or political will to do much of anything in this case? I don’t see it happening, myself, other than, maybe, there will be some Bernie Maddoff scapegoat located and put through the “Justice” system and sent to some ClubFed.
      I used to do work in the US Virgin Islands way back in the ’80s. Everyone down there knew that the BVI was a giant tax haven back then. It’s interesting to note it’s role in the Panama Papers, but quite honestly, a lot of what’s in the Panama Papers really isn’t “news,” other than they are naming names and providing actual intel on what’s going on and who is doing it.
      What has that Senate Committee done in the meantime? Bupkiss. Will they do much of anything now? Highly unlikely. JMHO, of course. hope I’m totally wrong, but not holding my breath.
      Still the news is of interest, so thanks for that.

  9. bloopie2 says:

    Re the recent Hospital malware attacks. Here’s a Guardian article on whitehat hackers in India who get paid by tech companies to find bugs. This part of the article, I find fascinating:
    “Arora believes the next world war will be won online, and that India’s cyber security experts will have a major role to play. He explains that hospital software is a particular vulnerability and hackers like him are devising new ways to keep patients safe. “In the ICU the technology [one hospital] was using was a cloud-based machine,” he explains. “I hacked it, I found vulnerability and I shut it down. The person on the operating table could have been killed, and you’d never be able to trace the killer. “That’s the future of cyber attacks. They’ll breach our security, we’ll breach theirs,” he says. “Getting access to confidential information can destroy peoples’ lives.”
    Says so much about cybersecurity in general, about cloud based computing, about the absolute idiocy of the Internet of Things, and about war. Can I just stay home today and watch TV? Or is that not safe?

  10. cfiace says:

    Hope springs eternal that the hacker (unless a state player) would release the 2.6tb of data to the likes of Wikileaks for further distribution if Sueddeutsche Zeitung and Co. appears to sit on or edit the data.

  11. Ian says:

    For a fuller explanation of the Offshore-Finance-Industry/Tax-Haven-Industry worldwide can I recommend:
    THE ECONOMIST’s Special Report on Offshore Finance of Feb 13 2013
    In the table covering Sources & Sites of Private Offshore Wealth North Americans are prominent for flowing through the Caribbean & Panama[ as distinct from the Seychelles & Mauritius,for example where Republic of India wealth goes]—-so any absence from the published reports is doubly interesting

  12. earlofhuntingdon says:

    I’m shocked, shocked, that the independently wealthy and (London’s) City-dependent prime minister, Mr. Cameron, did nothing to restrain access to BVI, or other Caribbean, British or Asian tax havens. Mr. Cameron is as likely to do that as Mr. McConnell is to vote for Dawn Johnsen to head the DoJ.

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