Today’s Top Stories from GFI: New Money Laundering Video

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Money Laundering

Video: How Money Laundering Works, And How We Can Fight It
Global Financial Integrity Video, November 6, 2013

Saul Goodman and Leo Getz might be funny characters on Breaking Bad and the Lethal Weapon series, but money laundering enables crimes like sex slavery, arms trafficking, and rhino poaching. Criminals launder billions of dollars through the U.S.

They set up anonymous shell companies in states like Delaware, Wyoming, and Nevada, use them to open up bank accounts in offshore tax havens like the Cayman Islands and Bermuda, and almost always escape prosecution. And when banks have gotten caught letting criminals launder money, the U.S. government has treated them as ‘Too Big to Jail.”

Watch the Video…

Bulgaria investigates politician for money-laundering
Reuters, November 7, 2013

Bulgarian prosecutors launched an investigation on Thursday over possible tax fraud and money laundering by a senior politician who ended his political career abruptly last week when he quit party and state posts.

The investigation is a new headache for the Socialist-led government, which has faced almost daily street protests over charges of corruption since it took office in May.

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Automatic Exchange of Tax Information

European Borders Tested as Money Is Moved to Shield Wealth
The New York Times, November 3, 2013

By Doreen Carvajal and Raphael Minder

There was nothing extraordinary about the casually dressed businessman waiting on a Paris train platform except, it turned out, for the envelopes he carried — stuffed with 350,000 euros in cash, and seized by French customs agents as he prepared to depart for Belgium.

The passenger, Boris Boillon, 43, is a former French ambassador to Iraq and Tunisia with two degrees from prestigious universities and a Legion of Honor medal. But to customs agents, who seized the money in July, he was just one of a growing number of “cash commuters.”

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The Middle East, Monaco, Singapore: Who’s Profiting From the Swiss Banking Secrecy Ratline?
International Business Times, November 6, 2013

By Ian Allison

I asked a professor of economics from a well-known university in switzerland where the money leaving his country’s coffers might be heading.

“I’m not a detective and neither am I psychic,” he replied.

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Illicit Financial Flows

‘Tracking illicit financial flows key to stemming oil theft’
Business Day (Nigeria), November 7, 2013

Tracking the illicit financial flows associated with oil theft is one of the key weapons available to the Nigerian government and international partners in the fight against the menace of crude oil theft, experts have said.

At a workshop convened by Stop The Theft in London weekend for international experts on economic crime to consider solutions to oil theft in the Niger Delta, the experts focused on assessing the relevance and potential application of existing international frameworks to track financial flows from oil theft.

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‘Massive’ Navy Bribery, Hooker Scandal Grows: Third Officer Charged
ABC News, November 6, 2013

By Lee Ferran

Another high-ranking Navy officer has been charged with providing a foreign defense contractor classified information in exchange for prostitutes, luxury travel and $100,000 in cash, the latest development in an ever-widening alleged international bribery scandal.

Navy Commander Jose Luis Sanchez, 41, was arrested in Tampa, Fla. today, becoming the third Navy official to be caught up in the military’s investigation into Singapore-based vessel husbandry firm Glenn Defense Marine Asia (GDMA), which provides millions of dollars-worth of port services to the Navy in ports across Asia — and which allegedly provided a lot more to a few purportedly crooked Navy officers.

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New Criminal Charges in Widening US Navy Corruption Probe
Voice of America, November 6, 2013

U.S. prosecutors have accused a third senior U.S. Navy official in a widening bribery probe involving millions of dollars in excess charges for refueling and supplying U.S. fleet ships in Asian ports.

A Justice Department statement said Navy Commander Jose Luis Sanchez was arrested early Wednesday in Florida. He was charged with accepting prostitutes, luxury travel and $100,000 from a foreign defense contractor in exchange for classified and internal Navy information.

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Tax Havens

Britain rules the world of tax havens, Queen is warned
The Guardian, November 6, 2013

By Simon Bowers

Britain, in partnership with Her Majesty’s overseas territories and crown dependencies, remains “by far the most important part of the global offshore system of tax havens and secrecy jurisdictions”, the Queen will be told tomorrowin a letter from tax experts and campaigners.

The monarch, who acts as head of state for UK-linked jurisdictions as far away as the Cayman Islands, the British Virgin Islands, Jersey and the Isle of Man, will receive a copy of the Tax Justice Network’s (TJN) two-yearly index of financial secrecy, which paints an unflattering picture of Britain and its close ties to many leading tax havens.

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Lifting the veil
The Economist (blog), November 6, 2013

By Joseph Schumpeter

Every two years the Tax Justice Network, a campaigning group, publishes a Financial Secrecy Index (FSI), showing which jurisdictions are friendliest towards tax evaders, money launderers and other financial ne’er-do-wells. Countries are ranked according to a combination of a secrecy score (based on 15 indicators, including banking secrecy, transparency of corporate ownership and international judicial co-operation) and a weighting that reflects the size of their financial sector.

The latest FSI, released on November 7th, shows switzerland once again at the top of the list, with a score little changed from 2011 (Zurich is pictured above). Though the Swiss have made some concessions, especially to America, these appear so far to have put only small dents in their overall financial-secrecy framework. Meanwhile, they have been striving to block or delay multilateral transparency initiatives. The government did recently agree to sign an OECD tax convention, but this calls only for “on request” (not automatic) exchange of information. Still, it would bring down the Alpine country’s secrecy score a bit, if ratified.

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Tax Evasion and Tax Avoidance

BBC puts talent to test over tax
Broadcast, November 7, 2013

By Jake Kanter

The bbc is prepared to lose some of its key talent as it begins putting them through employment tests as part of a campaign to tighten up its tax arrangements.

The corporation is attempting to clamp down on the use of personal service companies (PSCs) and is seeking to introduce more consistency to its contracting arrangements in a move that could force some its highest-profile stars to join the payroll, or leave the BBC.

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Global Financial Integrity (GFI) promotes national and multilateral policies, safeguards, and agreements aimed at curtailing the cross-border flow of illegal money. In putting forward solutions, facilitating strategic partnerships, and conducting groundbreaking research, GFI is leading the way in efforts to curtail illicit financial flows and enhance global development and security.

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