Archive for offshore tax havens

Hedge Fund Billionaires Lower Taxes by Sending Cash on a Bermuda Vacation


chart vulture income disparity inequality smaller

Your Daily Dose of BuzzFlash at Truthout, via my pal Mark Karlin:

Bloomberg Businessweek (ironically owned by politician plutocrat and defender of the oligarchy Michael Bloomberg) just reported that "a hedge fund tax dodge uses Bermuda reinsurers" ... But the Bermuda based "reinsurers" are sometimes just little more than mail drops that serve as a vehicle for tax-evasion money laundering, with little concern being expressed by the IRS. [...]

Referring to three gluttonously wealthy hedge fund managers, Bloomberg Businessweek reveals:

The companies set up by Paulson, Cohen, and Loeb are all located within a half-mile of each other in the narrow streets of Hamilton, Bermuda’s capital and the global center of the reinsurance industry. The three put a combined $1.7 billion back into the fund managers’ hands last year.

Even the Murdoch-owned tabloid The New York Post jumped on the legalized theft from the public purse of this scheme...

Billionaire hedge-fund moguls are getting comfortable with a US tax loophole to fatten their already plump bottom lines. [...]

Hedgies like John Paulson and Steve Cohen are forming reinsurance companies in tax-free havens like Bermuda or the Cayman Islands — and then transferring cash from their funds to the reinsurance companies.

The cash, classified as insurance company reserves, is then transferred back into the funds as reserves to be invested for future claims.

Thanks to an IRS loophole, profits from these insurance companies aren’t taxed — until the stake in the fund is sold, and that could be years down the line.

And here’s the kicker: The taxes, when paid, are at the lower capital-gains rate and not as ordinary income. [...]

The more the rich get richer, the more they get a free pass from legal oversight.

Please read the entire post here.


Another day, another GOP hypocrite


pro life hypocrisy Via Sodahead

In today's L.A. Times, there was an article about the Senate approving $50.5 billion in Superstorm Sandy aid. Wow, Senate, that only took... months.

But aside from the obvious outrage-worthy content in the piece, there was one quote that caught my eye:

A number of Republicans unsuccessfully sought to offset the aid with cuts to other federal spending.

"We have a habit here of throwing money at things under an emergency category and then later finding out, one, it wasn’t an emergency where the money went, and number two, it was misspent and not effective,’’ said Sen. Dan Coats (R-Ind.).

Via Wiki:

From August 15, 2001 to February 28, 2005, Coats was the United States Ambassador to Germany.[11][12] As ambassador during the lead up to the Iraq war, he pressured the German government not to oppose the war, threatening worsened US relations with Germany.[13]  [...]

In 2007, Coats served as co-chairman of a team of lobbyists for Cooper Industries, a Texas corporation that moved its principal place of business to Bermuda, where it would not be liable for U.S. taxes. He successfully blocked Senate legislation that would have prevented a tax loophole, worth hundreds of millions of dollars to Cooper Industries.[16]  [...]

Coats is affiliated with the Fellowship, an informal association of Christian lawmakers.[25]

So he supported invading and destroying Iraq, a war that was kept off the books, a war that wasn't paid for or "offset," a war that was put on a credit card and threw "money at things" and then we "later found out, one, it wasn’t an emergency where the money went, and number two, it was misspent and not effective."

And he supported those infamous Romney-style offshore tax havens that have cost our economy a pretty penny.

And he claims to be oh so Christian, yet voted against helping fellow Americans whose lives were devastated by a natural disaster. Pro-life my ass.

Hypocrisy, thy name is Coats.


VIDEO-- Romnopoly: To Mitt Romney, "your job and our economy are just a game."


"Your job and our economy are just a game."

This is a memorable, creative recap of Willard M. Romney's economic priorities, from gutting education to "let Detroit go bankrupt" to his bankrupting-companies days at Bain to cutting retirement programs to pay for tax breaks for the very rich.

Check out the dog-on-the-car-roof game piece. Gold.

(Democratic super PAC ):

From opposing the auto recovery plan and laying off workers during his time at Bain to gutting education to pay for tax cuts to the rich, the ad runs through the many reasons that if Mitt Romney wins, the middle class will lose.

Learn more, please visit

Supporting Facts for "Romnopoly":

Romney Wanted To "Let Detroit Go Bankrupt" And Said The Demise Of The Auto Industry Would Be "Virtually Guaranteed" By A Government Bailout. According to Romney, "If General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won't go overnight, but its demise will be virtually guaranteed. Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check." [Romney Op-Ed, New York Times, 11/19/08]

Bain Owned GS Industries Filed For Bankruptcy And 750 People Lost Their Jobs. "Bain acquired GS Industries in 1993. The steelmaker borrowed heavily to modernize plants in Kansas City and North Carolina, as well as pay dividends to Bain investors. But as foreign competition increased and steel prices fell in the late 1990s, the company struggled to support the debt, according to Mark Essig, the former CEO. GS filed for bankruptcy in 2001, and shut down its money-losing Kansas City plant, throwing some 750 employees out of work." [Boston Globe, 1/27/08]

Workers at the paper plant in Marion were fired hours after Bain Capital purchased the plant. According to the Boston Herald, "Hours after Bain-owned Ampad Corp. bought the plant July 5 from Smith Corona Corp., the plant's 250 union workers were fired and told they could re-apply for their old jobs. Ampad scuttled Smith Corona's contract with the United Paperworkers International, seeking to make wage and labor conditions similar to its three other non-union plants. Drug tests were also required." [Boston Herlad, 9/23/94]

Tax Policy Center: Romney Tax Plan Would Raise Taxes On Families With Children With Income Below $200,000 By $2,041. According to a Tax Policy Center analysis of Romney's tax plan and promises, families with children that earn below $200,000 a year would see tax increases of $2,041. [Tax Policy Center, 8/1/12]

Tax Policy Center: Top 0.1% Would See $246,652 Tax Cut Per Year Under Romney Plan. According to a Tax Policy Center analysis of Romney's tax plan and promises, the top 0.1% would receive a tax cut of $246,652 per year. [Tax Policy Center, 8/1/12]

Romney Held Investments In Off-Shore Tax Havens And An Unusually Large IRA In Places Like Switzerland, Bermuda and The Cayman Islands. According to Bloomberg, "Romney's extensive investments in tax havens are drawing intensifying media scrutiny at the same time that revenue- starved governments around the world are cracking down on such practices. In recent weeks, Romney has faced increasing pressure to release additional years of tax returns because of questions over his 13.9 percent personal tax rate, his Swiss bank account, an IRA valued at as much as $102 million and his investments in Bermuda and the Cayman Islands." [Bloomberg, 08/06/12]

Romney Said He Would Not "Promise" Government Money To Help Students Pay For College But Suggested They Shop Around For Schools. According to New York Times, "The high school senior who stood up at Mitt Romney's town hall meeting here today was worried about how he and his family would pay for college, and wanted to hear what the candidate would do about rising college costs if elected...The answer: nothing. But his warning was clear: shop around and get a good price, because you're on your own. 'It would be popular for me to stand up and say I'm going to give you government money to pay for your college, but I'm not going to promise that,' he said, to sustained applause from the crowd at a high-tech metals assembly factory here. 'Don't just go to one that has the highest price. Go to one that has a little lower price where you can get a good education. And hopefully you'll find that. And don't expect the government to forgive the debt that you take on.' There wasn't a word about the variety of government loan programs, which have made it possible for millions of students to get college degrees. There wasn't a word urging colleges to hold down tuition increases, as President Obama has been doing, or a suggestion that the student consider a work-study program." [New York Times, 3/5/12]


MoveOn: "Strong possibility of Romney criminal liability" in personal financial disclosure filings


New Legal Analysis Finds Strong Possibility of Romney Criminal Liability for Misrepresentation He Made in F...

Earlier, I posted Finally! Accountant explains Romney’s offshore accounts, blind trust, taxes, and more… in layman’s terms.

How about in legal terms? Via MoveOn:


The facts known about Gov. Romney’s role in Bain Capital entities after 1999 strongly suggest that Gov. Romney made a false statement in violation of the False Statements Act in categorically asserting, in 2011, on his Financial Disclosure Form, that since February 1999, he had not been involved in the operations of any Bain Capital entity in any way. At a minimum,the facts call out for a full investigation by the U.S. Department of Justice.

Works for me.


Finally! Accountant explains Romney's offshore accounts, blind trust, taxes, and more... in layman's terms



Today’s guest post is from my long time, dear friend, a TV writer-producer with an endless and impressive resumé, David Garber. If you're anything like me, the minute you hear the words finances, taxes, or accountants, you start to glaze over. This explanation from an accountant friend of David's helped me, so I hope it helps some of you, too:

A friend, who's an accountant came over last night and I asked him if he could explain the Romney tax situation regarding foreign, off-shore banking, income, investments and such, based on the 2010 and 2011 Federal tax returns as we've seen them. He put it in English -- instead of all these pundits trying to explain it with legal and accounting terms. I think now get it, and perhaps your readers would understand it when put in my friends words. By the way, I do have a BS in Business Administration, and I didn't understand this until now.

The Cayman Island thing goes this way: (which by the way is legal, though to what degree legal and moral overlap in this will always be fodder for debate)

Mitt deposits money from business dealings around the world, some in the US, many in foreign lands into off-shore banks. (This is done through foreign corporations his 'blind trust' controls/owns. Some of these banks he uses, BTW, are just post office boxes or storefronts, not a bank like we in the states think of them.

He then takes out money from that account, but in a foreign currency -- for example, Cayman Dollars.

When he brings that money into the states, it's taxed at a lower rate and he's given credit as if he's bringing in a foreign investment.

Then he reconverts the currency into American money in his US banks but it's already been taxed as a foreign investment and he gets to write off additional conversion charges so the reduced money is already taxed, free and clear. It's coming from his foreign corporation.

Then he ships the American money to China (through his blind trusts investments) to purchase energy or other companies, takes an investment tax credit to further reduce his tax liability or redeposits it back into the Swiss or other foreign banks, which give him a premium interest rate because he's using American dollars.

It's all legal, but by doing this, he's avoiding paying some American corporate taxes and getting a write-off against any money he stores here, accruing interest. He can even back foreign currencies against the dollar using that money, which again, isn't illegal, just a bit immoral -- an American hedging against the US dollar.

So goes the Romney cycle. By using the Caymans he avoids much of the US corp taxes which are around 37% and he still gets to write off the houses, boats, travel, meals, clothes, haircuts -- just about everything he spends money on. It's a write-off against his businesses here.


VIDEO- Romney: “There was no reduction- not 1 dollar reduction in taxes- by virtue of having an account in Switzerland or a Cayman Islands investment."


Via from an interview with Chris Wallace on Fox News Sunday.

“There was no reduction --  not one dollar reduction in taxes -- by virtue of having an account in Switzerland or a Cayman Islands investment."

“The conduct of the trustee in making investments was entirely consistent with U.S. law and all the taxes paid were those legally owed and there was no tax savings by virtue of those entities."

“I could have said, ‘Don't make any investments in any foreign companies, in any foreign bonds, in any foreign currency, only U.S. entities. And by the way, don't buy any foreign products, don't have any Japanese TVs, or foreign cars.’ I could have done that."

Yes, you could have done that.

We interrupt this post for a Willard Whopper Alert! Incoming! The majorest of major whoppers in 5... 4... 3... 2...

“But you know, I did live my life and I expect that by virtue of disclosing all of these things, people can take look at it and see whether that’s something they’re comfortable with or not. I’m not going to try to hide who I am and try and manipulate my life to try and avoid the truth.”

Some of us beg to differ: VIDEO: Mitt Romney won’t discuss his record as Mass. governor. No worries, we’ve got it covered.

And there's this: VIDEO: Serial hypocrite Mitt Romney lied, pointed fingers in 2002 and got away with it. It’s now 2012: Blather, wince, repeat.

So by “not avoiding the truth” he means releasing one incomplete 2010 return and one 2011 estimate… And how about all the rest of Willard‘s lies?

As I said in a previous post, media, will you please take Rachel Maddow up on her request to insist that Mitt Romney (and Paul Ryan) give us some straight answers? Or “do you just write down what they say?”

“It’s not what they say, it’s about what they’ve done. And when what they say is some distance from what they’ve done, that distance is the story. This is what the press is for.”

Speaking of lies:

“Their campaign is trying to find something to say, ‘Gee, hey, he had a Swiss bank account,’ which apparently was done by the blind trustee. I mean, I had no involvement in this, but the blind trust said we’re going to have some currencies, U.S. currency and some in foreign currency, that tends to be something which investors do. But they’re trying to make that seem like it is some kind of unsavory action and frankly all of the taxes are paid exactly as owed and there were no tax savings by virtue of having that vehicle.”

"I had no involvement in this, but the blind trust said..." So now blind trusts can speak?

Blind trusts are people, too my friend.

Hypocrites can certainly speak. Remember this, Willard?


In 2010 Paul Ryan paid an effective tax rate of 15.9%. In 2011, 20%.



Coupon Paul Ryan is right up there with LaDeeDa Willard Romney when it comes to displaying a sense of entitlement and outward disdain toward voters. And just like Willard, Coupon Paul is only releasing two years of tax returns (although Willard has really only released part of his 2010 return and an estimate of 2011). And again, like Romney, he's paying a lower rate than most middle class families do.  And yet they want us to pay more so they can pay less.

Romney thinks we're asking “small minded questions” about his tax returns and said, “I never paid less than 13 percent.” How dare we want to understand a guy who wants to be the leader of the free world?  Who are we to ask how he's affecting the U.S. economy? How rude of "you people" to want to see firsthand whether or not he's lying again!

And Paul Ryan has assured us that he's limiting his disclosures to a measly two years as well, even though he submitted several years of returns when he was being vetted by Team Romney.

They're sure showing us, aren't they?

Via JSOnline:

Paul Ryan and his wife Janna paid an effective tax rate of 15.9% in 2010 and 20% in 2011, according to tax returns provided by the Romney-Ryan campaign to the Journal Sentinel Friday. [...]

[T]he couple also earned significant outside income from dividends, capital gains, real estate and other sources. ... [T]he Ryans’ investments include several companies that lease land and mineral rights to energy companies. [...]

The Ryans filed a corrected return in 2011 after their original return understated their income by $61,122.

The last thing Romney and Ryan want is to give us "more ammunition."