The U.S., viewed from space

Update – Jan 2021 – Historic new U.S. legislation overturns the U.S.’ secret shell company legislation, weakening (though not eliminating) the U.S.’ status as a secrecy jurisdiction.

Update – April 2020. New research based on classified documents reveals an untold and previously secret history of how civil servants in the UK, in partnership with bankers (while excluding law enforcement officials) tailored US-devised money laundering policies to suit the needs of Britain’s financial services industry.

Update – March 2019 – The EU should blacklist the US as a tax haven. Oxfam America.

Update – March 2019 – Russian-Style Kleptocracy Is Infiltrating America. The Atlantic. “New York, Los Angeles, and Miami have joined London as the world’s most desired destinations for laundered money. This boom has enriched the American elites who have enabled it.”

Update – April 2018. Corporate Secrecy Fuels Human Trafficking in United States. Polaris.

Update 13 – Jul 2017 – The U.S. Is a Good Place for Bad People to Stash Their Money in The Atlantic – ‘America vows to promote financial transparency, yet it will let just about anyone register an anonymous shell company’

Update 12 – Jun 2017 – FATCA reciprocity watch: on US single-person LLCs, and more.

Update 11 – Jan 2017:  The U.S. hasn’t signed the AEoI Agreement: Reciprocity demanded. Switzerland demands that the United States be less of a tax and secrecy haven.

Update 10, May 2016 – US tax havens – the new Switzerland (Financial Times). “I think the US is already the world’s largest offshore centre”.

Update 9, April 2016: How the U.S. became one of the world’s biggest tax havens – Washington Post.

Update 8: now in The Economist.

Update 7: See also this Bloomberg story entitled The World’s Favorite New Tax Haven Is the United States

Update 6: Jan 2016 –  TJN calls for Fatca-like withholding taxes against financial institutions from USA and other financial centres.

Update 5: see our narrative report on how the United States became a secrecy jurisdiction. Also see Tax Analyst’s U.S. Ranks As Top Tax Haven, Refusing To Share Tax Data Despite FATCA

Update 4: see this Oct 2014 technical article entitled Hiding in Plain Sight: how non-US persons can legally avoid reporting under both FATCA and GATCA.

Update 3: more details on U.S. roadblocks from Value Walk, here.

Update 2: more details from Allison Christians, here, from 2013.

Update: Naked Capitalism in the U.S. has published an adapted version of this article, here.

If people stash their wealth or earn income overseas, that is fine with us — just as long as their tax authorities get the information they need to tax that wealth or income according to the law, and as long as money laundering and financial crimes can be effectively tracked, and so on. Where there are cross-border barriers to the instruments of democratic societies, then there is an offshore problem.

The only credible way to provide the necessary information is through so-called automatic information exchange (AIE), where governments make sure the necessary information is available across borders, as a matter of routine.

For years we at the Tax Justice Network were ridiculed for advocating AIE: pie in the sky, many people said. The OECD, the club of rich countries that dominates international rule-making on tax and tax-related information sharing, was for years pushing its so-called Internationally Accepted Standard which was, well, the internationally accepted standard for cross-border information exchange, despite being only slightly better than useless. The message was that we should just accept this, and move on.

How the world has turned since a couple of years ago. Continue reading “Loophole USA: the vortex-shaped hole in global financial transparency” →