Rising and Falling Fortunes: Rothschild Empire Faces Criminal Investigation in US and France

by Nomad

It might be a name long associated with fabulous wealth and enormous political influence, but the Rothschild Empire has been had its share of humiliations of late.

Hard Times for Billionaire Dynasty

As pioneers of international banking (as well as probably the wealthiest family in the history of the world,) the Rothschilds have been the subject of many a conspiracy theory. The exact amount of their family fortune is undisclosed, but by one conservative estimate, the Rothschild family controls assets worth more than $350 billion when each of their personal fortunes is combined.

The Rothschild dynasty is the el supreme of all family dynasties and went thing go bad there are plenty of people to gloat and plenty more to send their condolences. Ah, the way of the world is such like. 

The family business has apparently been hit hard by the worldwide economic slump. That's not all the problems they have been facing. 

In June of last year, Baron David de Rothschild, chairman of the Rothschild Financial Services Group since 2003, was indicted by French police for his role in a fraud case. The independent investment banking organization which offers financial services to governments, corporations, and individuals worldwide. was charged with "falsely advertising an equity release loan scheme, bought into by more than 130 pensioners between 2005 and 2008."

More than 20 British pensioners in Spain took up legal action against Rothschild’s company after losing their dream properties and thousands of euros.

French investigators claimed that Rothschild’s product, the Credit Select Series Mortgage Loan, was sold to retirees as a legal tax haven, specifically as a mean to reduce the apparent value of their homes for inheritance tax mitigation purposes.

The problem is that it wasn't as legal as Rothschild executives had claimed. The French tax agency ruled that such a scheme was a nothing more than fraud and that Rothschild should be held accountable. Said one of the French prosecutors:

“In short, independently of what happened to the investment, Rothschild advertised a loan aimed at reducing inheritance tax, which is a breach of tax law."

The victims who now stand to lose their homes told the courts that they felt confident of the financial packages, having put their faith in the Rothschild name. In its defense, the investment banking company pointed out that its involvement was limited. It had only provided the loan, and "was not involved in the investment side of the deal, which was carried out by financial intermediaries based in Spain, most of whom were British."

FATCA: Why New Tax Haven Laws are a Disaster in the Making

by Robert Morris

Here's a guest post with some further insight on a controversial piece of legislation called FATCA. Robert Morris explains why this law on tax havens is a really really bad idea. 

First off, I would like to thank Nomad Politics for bringing up this issue, and also for reaching out to seek an opposing viewpoint to its FATCA coverage. This is the kind of open-mindedness that we could all use more of.

In that spirit, let's start by laying out a positive aspect of FATCA, the Foreign Account Tax Compliance Act.

Some Facts about FATCA

This US law was largely introduced in response to a Swiss banking scandal. A significant number of Swiss banks were revealed to have been colluding with US citizens to hide their earnings from the US government. FATCA has, in fact, severely disrupted the Swiss banking industry. Switzerland’s “too big too fail” banks, like UBS, have settled with the US government for sums that are eye-watering, but will not severely disrupt their business. Medium-size and smaller Swiss banks are being forced to pay proportionally much larger sums, whether or not they knew their clients were from the US. Many are going out of business. The small Swiss banks that survive this reckoning will certainly think twice before they ever deal with US clients again.

Judging from the fact that my anti-FATCA video has been viewed by about a 50th of the entire population of the Cayman Islands, the legislation has been having the desired effect in other tax haven jurisdictions as well. We should admit that in this one respect, FATCA has been having the desired consequence. Tax avoidance by Americans has become more difficult, and that is a good thing.

This one positive result, however should not distract the public from FATCA’s truly mind-boggling scope. FATCA is a sledgehammer that is being used where a toothpick was necessary. FATCA does not just go after Switzerland and Cayman. It fundamentally re-orders the business of banking for every country, and in every country.

FATCA Repeal : Tax-Avoiding Super Wealthy with Secret Bank Accounts Find a Friend in GOP

by Nomad

Once again, the Republican Party has demonstrated which side it supports. Between the average taxpayer or the 1%, its call for a repeal of Obama's anti-tax haven law of 2009- before it has even had a chance to be put into effect- provides us with a clear answer.  

Some Facts on FATCA

Reuters is reporting that the Republican Party is expected to approve a resolution this week, calling for repeal of an Obama administration law that is designed to crack down on offshore tax dodging.

The law, Foreign Account Tax Compliance Act (FATCA) requires foreign banks to find any American account holders and disclose their balances, receipts, and withdrawals to the US Internal Revenue Service (IRS), or be subject to a 30-percent withholding tax on income from US financial assets held by the banks. Owners of these foreign-held assets must report them on US tax returns if they are worth more than $50,000.

It was always going to be controversial and not beloved by banks, libertarians and some Americans living abroad. Another example of Big Government overreach, they howled. Lobbyists have been successful at delaying the law in operation. Its effective date has been pushed back repeatedly, with enforcement now set to start on July 1. 

If the Republicans have their way- and there doesn't seem to be much chance they will- FATCA would never start at all.

IRS Scandal: Why Should Tea Party Groups Have Any Tax Exemptions?

The rules for tax exemptions for organizations are not well-understood. They tend to be complicated and, even then not well-enforced. Still, it is fair to ask, when it comes to tax exemption, what makes the Tea Party organizations so special?

It has been really hard to get my head around the recent “scandals” that have “plagued” Obama’s second term. Quotation marks are mandatory in this case since, as far as I can see, the scandals seem to be an imaginative invention manufactured by the Republican Congress and a mainstream media.

(To be sure, there are questions that should be asked to the president about, for example, the handling of such things as Gitmo, the legality of drones, press freedom and other things.)

The investigation of the Benghazi tragedy has dragged along becoming less and less productive and more and more embarrassing for the investigators. All of the rocks have been squeezed and much to their dismay, GOP congressmen have found not even a drop of blood.

However, the most ridiculous of these so-called scandals has been the accusation of the IRS targeting Tea Party tax-exempt organizations. (Daily Kos has called the whole affair a "Scandalnavian nothing-burger.")

Targeting Flaunters

As long-time readers of this blog may know, we have examined the possible violations of both Tea Party and Christian right-wing 501(c)3 and 501(c)4 organizations in the past. The abuse of their tax-exempt status has been openly flaunted. It was clear that something had to be done.

In the run-up to the election, religious organizations, in particular, seem to challenge the administration to take action. A careful reading of the tax codes demonstrates beyond much doubt that these organizations should have come under some kind of scrutiny at least.

And yet, somehow we find the entire argument re-framed as "targeting" and "profiling." Is it really wrong to target those who publicly flaunt the law?

When Leona ("Queen of Mean") Hemsley went on 60 minutes and proclaimed “We don't pay taxes. Only the little people pay taxes” would anybody have accused the IRS of targeting super-wealthy hoteliers?
No.
Most people felt she deserved what she got for thinking she was somehow untouchable. Today the Republican party has become the chosen defenders of anybody who would defy  the IRS and the Obama administration, in general. 

The Rise and Fall of Businessman Rick Scott - 2/2

by Nomad

In Part One of this two-part series we took a close look at the rise of Rick Scott who, through its aggressive business tactics built the largest for-profit healthcare provider network.
Before the scandal which was to rock the company to its foundations, the corporation had grown to more than 340 hospitals, 135 surgery centers and 550 home health locations in 37 states and two foreign countries. 
And then, in a matter of months, it was out of Scott's hands.

Scott's Sudden Fall 

Scott's prestigious empire all came a-tumbling down when, on March 19, 1997, FBI agents, in conjunction with the Internal Revenue Service, the Health and Human Services (which oversees Medicare), and the Defense Department's Criminal Investigation Service raided Columbia/HCA facilities in El Paso, Texas. Eventually the seizure of documents regarding the case would expand across the country. At issue were allegations that Columbia/HCA had knowingly bilked Medicare and Medicaid.