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IMAGINATIVE VARIATIONS ON NIGERIA EMAIL SCAM APPEARING
The latest purports to be from Loi C. Estrada, who says that her husband, the former president of the Philippines, siphoned off $30,000,000. She wants us to help her liberate the cash but she appears to be cheating on good husband, according to the following e-missive.More on this story here.
PUBLIC OVERWHELMINGLY SUPPORTS ID CARDS, CLAIMS UK MINISTER
Or at least, the “around 1,500 people and organisations [who] have sent in their comments” on the current consultation exercise have split two to one in favor, while “450 volunteers” who are apparently being experimented on are even more pro. All this according to Home Office minister and long-standing Blair bagman Lord Falconer. (It is a long-standing right of people in the UK not to have to carry any form of ID.)More on this story here.
A campaign to mass email the Home Office protesting about the UK government’s plans for the introduction of national ID cards could backfire on the activists. Leaving aside for a moment that this plan is an incitement to spam, there seems to be one rather obvious fault which seems to have eluded those up in arms over ID cards. If a mass emailing takes place, the home office will have a handy cut-out-‘n’-keep list of every troublemaker, anarchist, old Labourite, whining lefty and a Mrs. Trellis of North Wales, complete with their home addresses. This will obviously come in very handy for sending round the black helicopters in the middle of the night and disappearing them.More on this story here.
ARE SPY CHIPS SET TO GO COMMERCIAL?
In the future, we could be tracked because we will be wearing, eating and carrying objects that are carefully designed to do so. The generic name for this technology is RFID, which stands for radio frequency identification. RFID tags are miniscule microchips, which already have shrunk to half the size of a grain of sand. They listen for a radio query and respond by transmitting their unique ID code. Most RFID tags have no batteries: They use the power from the initial radio signal to transmit their response.More on this story here.
In the Pentagon research effort to detect terrorism by electronically monitoring the civilian population, the most remarkable detail may be this: Most of the pieces of the system are already in place. The civilian population has willingly embraced the technical prerequisites for a national surveillance system that Pentagon planners are calling Total Information Awareness.More on this story here.
The legislation creating the Department of Homeland Security contains provisions that build on law enforcement’s ability to peek at e-mail, monitor credit card purchases, bank transactions and travel patterns and shield its own activities from scrutiny. Coupled with a series of recent court rulings favorable to the Department of Justice and new administration initiatives, privacy advocates warn that the nation is indeed experiencing the beginnings of a real-life Orwellian nightmare.
“The Department of Homeland Defense is another example of ... providing authority to the executive branch with a lack of effective oversight and checks and balances,” says legal director for People for the American Way, a liberal interest group that monitors the administration's judicial activity.More on this story here.
BOOK REVIEW: NETOCRACY
Swedish authors Jan Söderqvist and Alexander Bard, after taking a long, hard look at the world, pose the questions: What is the major economic driving force of today and the future, and how will society change as a result? Their answers provide an intriguing glimpse into what the world could look like in the future.
We have yet to reach the tip of the information revolution. The more information technology dominates, the more culture, society and the economy change. It’s the birth of a “whole new world” — a world undergoing a paradigm shift right under our noses. Say goodbye to the nation state and governments. Capitalism will be no more and its chief proponent, the bourgeoisie, will gradually lose power and become a mere “underclass”.
Bard and Söderqvist’s basic premise is that the breakthrough of digital interactivity as the dominant form of communication is a paradigm shift that entails, in turn, a shift in power of the same extent as when the bourgeoisie — aided by the invention of the printing press and mass media — wrested power from the feudal aristocracy.More on this story here.
CARIBBEAN NATIONS PRESSURED BY G-7
Economic citizenship abolition is said to be a major goal.More on this story here. (Subscribers only)
LLOYDS TSB PULLS OUT OF BAHAMAS
Lloyds says it plans to phase out its unit over the next few months. It will transfer clients to other businesses in areas like Miami, Panama and the Channel Islands. The move comes months after Northern Rock, the UK mortgage bank, also closed its Bahamas operations blaming difficulties in attracting US investors. A third UK bank, Abbey National, is also considering pulling out of its offshore operations as part of a restructuring.More on this story here and here.
JERSEY FINANCE CHIEF MULLS EU MEMBERSHIP
ST. HELIER: Phil Austin suggested that the jurisdiction could benefit from joining the European Union at some point in the future. “At the moment we have to take the directions without any of the advantages,” he observed.More on this story here.
ARGENTINES RETURN TO ANCESTORS’ ITALY
Italian government’s €1.5 million Project Return allows children, grandchildren of Italians to leave Argentina behind and claim Italian citizenship. Millions of ethnic Italians are suffering through the current Argentine crisis, which has seen unemployment soar to 22%.More on this story here.
FAKE UK PASSPORTS AVAILABLE FOR CHEAP
£1,400 buys a new identity, a new passport that defeated all security checks, and entry to the UK. The source: “Little Algiers”, a small stretch of the Blackstock Road in north London, where scores of North African refugees live and work. It is also, according to the security services, where Islamic militants and al-Qaeda sympathisers plot the overthrow of their governments - and terrorist attacks on Western targets, many using false British identities and passports.More on this story here.
U.S. COMPANIES MOVING OFFSHORE CONTINUE TO BE TARGETED
WASHINGTON: Sen. Mark Dayton (D-Minn.) said he would champion the late Sen. Paul Wellstone’s (D-Minn) legislation banning homeland security contracts for companies that relocate offshore to avoid paying U.S. taxes. After his death in a plane crash in October, Congress weakened the Wellstone provision in the final version of the bill. In an interview, Dayton said that under the weaker provision, “Any corporation big enough to pay a high-priced lobbyist will get a waiver.”More on this story here.
A last minute change to the homeland measure will bar most corporations who move offshore to avoid U.S. taxes from getting federal contracts, except when it is essential to national security. Another change will make it easier for colleges and universities to compete for research grants or contracts from the new homeland security department. Finally, a provision blocking lawsuits by families who blame their children’s autism on a childhood vaccine preservative containing mercury will be repealed under an agreement announced in the Senate on Friday. The lawsuit block was one of several controversial measures tucked into the homeland security bill at the last minute last fall. It would have prevented families who believe the preservative thimerosal is responsible for the spike in autism cases from filing lawsuits against manufacturers such as Eli Lilly.More on this story here.
Under Bush tax plan tax havens may lose some appeal for US companies.More on this story here. (Subscribers only.)
RELIEF FROM ATTACKS ON OFFSHORE FINANCIAL CENTERS IN CARDS?
Centers targeted by proposed legislation in the US could see some relief from the political pressure they have faced from politicians over the past year. Republicans are back in charge of both sides of the US Congress and may now turn their efforts toward a comprehensive tax reform program rather than penalize offshore centers for having attractive tax policies. Veronique de Rugy of the Cato Institute said the Bush plan to abolish taxation on stock dividends is a good first move, but she is less optimistic that Republicans will have the courage to withdraw acts aimed at offshore centres.More on this story here.
WHY RICH FOREIGNERS LOVE LIVING IN LONDON
A loophole in Britain’s law allows many foreigners, an estimated 60,000+, to avoid paying tax on income generated outside Britain or on the disposal of foreign assets. This rule helps explain why so many rich foreigners choose to live in a city with such rotten weather and congested roads. If they pulled out, nasty things could happen to the price of penthouses. So there has been considerable alarm in monied circles since Labour chancellor Gordon Brown declared that he was going to review the rules in last April’s budget.More on this story here.
AUSTRALIAN OPPOSITION KEEPS UP ANTI-HAVEN / TAX EVASION PR CAMPAIGN
The Federal Opposition wants Tax Commissioner Michael Carmody called before a Federal Parliamentary committee to detail his knowledge about off-shore tax havens, and how he thinks they should be tackled. “In view of the large flow of funds from Australia to tax havens and the high associated risk to the revenue, I believe the committee should urgently examine this matter and as a first step invite the commissioner of taxation and relevant senior officers to attend the committee,” wrote Shadow assistant treasurer David Cox.More on this story here and here.
SOUTH KOREA PROMISE’S CRACKDOWN ON OFFSHORE TAX EVASION
To stop the outflow of foreign currency the National Tax Service said it would strengthen investigations of firms that evade taxes through international transactions, use international business to transfer income abroad, or dodge taxes by unlawful attractions of foreign investment. Also, excessive individual spending overseas will be subject to investigations.More on this story here.
FOREIGNERS WITHDRAW FUNDS FROM ISRAEL DUE TO TAX FEARS
Foreign investors have withdrawn millions of dollars from foreign resident accounts in Israel for fear that they will be taxed at a rate of 10 to 15% under the tax reform that took effect at the beginning of this year. Accountants who deal with foreign investors estimate that the withdrawals could reach hundreds of millions of dollars. The foreign resident accounts are often used as collateral for bank loans to Israeli companies owned by the investors. Deputy Income Tax Commissioner Oskar Aburazak says that this use of foreign resident accounts was a tax haven that had to be shut down.More on this story here.
INDIA LIFTS RESTRICTIONS ON OFFSHORE INVESTMENTS
Indian investment funds can now own up to $1bn in foreign shares. Previously, Indian investors were forced to keep all but a tiny amount of their money at home, a measure that has caused intense resentment in the country’s business community. The move goes some way to dismantling the protectionist walls that surround the Indian economy.More on this story here.
COOK ISLANDS SEEK REMOVAL FROM FATF BLACKLIST NEXT MONTH
The jurisdiction remains on the FATF’s list of jurisdictions considered vulnerable to money laundering activity, alongside Egypt, Grenada, Guatemala, Indonesia, Myanmar, Nauru, Nigeria, the Philippines, St Vincent and the Grenadines, and Ukraine. The government is now awaiting a visit from an IMF assessment team, and is keen to comply with the recommendations made.More on this story here.
U.S. JUDGE ORDERS END TO TAX EVASION SCAM
The widely promoted claim that Americans are not required to pay income taxes on their wages is false, a federal judge ruled Friday in ordering one of its leading proponents to stop inciting tax evasion. Thurston Bell was ordered to post the court’s order at his Web site (www.nite.org). Mr. Bell was also ordered to remove all language promoting the claim, known as the “861 position”, after a section of the tax code, that only those working for foreign-owned companies owe taxes on their wages. Mr. Bell must turn over to the Justice Department copies of his client’s tax returns, notify them that their returns were false and notify them that in addition to owing taxes they may face penalties for filing frivolous returns. Any refunds they obtained were erroneous, Judge Conner said, and the IRS may take them back.
“Although the First Amendment protects commercial speech generally, it does not protect false commercial speech,” Judge Conner wrote in rejecting Mr. Bell’s First Amendment argument.More on this story here.
WEST PALM BEACH, Florida: Golf course designer Theodore McAnlis was arrested December 20 after a grand jury indicted him on eight counts of evading more than $2.5 million in taxes. McAnlis put his property and money in “common law” trusts that some people claim are tax-exempt, but courts have ruled are shams. McAnlis launched a diatribe in federal court Tuesday, demanding that the government remove his shackles, release him on his own recognizance and give him a lawyer not connected to the Bar. Instead, U.S. Magistrate Linnea Johnson ordered him removed from the courtroom and said the hearing to determine who will represent him or whether he can represent himself will continue on Friday.More on this story here.
DO BUSH TAX PLANS FOMENT CLASS WARFARE?
US politics as usual, or is the true economic reality more promising? On January 7, President Bush proposed fully exempting dividends from the federal personal income tax, a bold step that even the great tax-cutter himself, Ronald Reagan, never tried. Also included in the plan were accelerating income tax cuts scheduled for later in the decade, investment incentives for small businesses, and a modest amount of money for job retraining.
Bush justified his proposals by saying that they would put more people back to work in the short run by pumping tens of billions of fiscal stimulus into the economy in 2003 and 2004. He also argued that the elimination of the dividend tax would encourage investment and lay the groundwork for growth and prosperity in the long run. Democrats countered with the undeniable fact that the biggest beneficiaries of the tax cuts would be the well-to-do. However, the old rhetoric of class warfare - rich vs. poor, investor vs. worker - may be increasingly obsolete. Dividends, interest, and other capital income are more evenly distributed than they once were. Moreover, America can prosper only if investors are willing to take a chance on innovative new businesses and technologies - and one way to encourage them to do that is to cut the taxes they pay.
No matter what legislation finally passes, simply by proposing to eliminate taxes on dividends, Bush has transformed the economic debate in a way that goes far beyond the magnitude of the proposals themselves. Economists of all political stripes have long agreed that reducing taxes on capital income - of which dividends are one kind - is a good thing to do. In fact, from the economic perspective, such a reduction in capital taxes makes far more sense than simply cutting the marginal tax rate on high-income households, as Reagan did. But the difficulty in reducing taxes on capital income, such as dividends and interest, always has been political.More on this story here.
There is little agreement about what qualifies one for inclusion among the “wealthy”. But whether one believes they should be soaked, or encouraged to create more wealth, even the terms of the debate are murky.
In the past, surges of wealth created backlashes that led to the trustbusting era in the 1890s and the New Deal of the 1930s. This time, attacks on the rich have found little traction. The party more sympathetic to the wealthy has won control of the White House and the Senate since stocks began falling and joblessness began rising in 2000. One possible reason the class-war criticism has not yet stuck is that defining wealth is more complicated than it once was. Some people have homes that have appreciated enormously in value, but they cannot sell them without buying a new, similarly expensive home. High-earners who live in high-cost areas feel stretched, while lower earners who live in less expensive places do not feel poor.More on this story here
Why is it that if the “rich” Smith family wants to keep more of the money which it has earned to spend as it sees fit, it is declared greedy by partisan Democrats, but if those partisan Democrats want to take the Smith family’s money to spend on government programs as they see fit, that is somehow compassionate? True to form, Democrats pounced on the president’s just-released $670 billion dollar package of tax cuts as “favoring the rich.” But the Democrats have two problems here, aside from any merits of the president’s plan: their definition of “rich,” and more important, the fact that a majority of Americans do not care if the tax cuts benefit the wealthy.More on this story here.
The Bush economic stimulus plan, which would end double taxation on dividend income and expand tax breaks for small businesses, is being labeled by congressional Democrats as a giveaway to rich taxpayers. However, according to IRS data, published by the Tax Foundation, high-income earners have been paying more than their fair share of taxes. In 2000, according to the IRS data, the top 25% of earners made 67.3% of the nation’s income but also bore 84% of the federal income tax burden. The top 10% of earners paid 67.3% of the income tax burden, while the top 1% of earners paid 37.4% of income taxes in 2000, the IRS data shows.More on this story here.
UK’S WEALTHIEST QUIETLY CONFIDENT
Britain’s wealthiest people are apparently quietly confident about their finances for the year ahead. At the same time, the country’s increasing concentration of wealth is unlikely to alter over the coming 12 months. These are among the main findings of a new Mintel report entitled “Private Banking & Wealth Management”.More on this story here.
Missing the January 31 deadline for UK self-assessment tax returns will result in a fine and a much greater chance of an investigation into your tax affairs, according to the Inland Revenue. Some ten per cent of self-assessment returns expected to be submitted late will immediately incur a £100 fine, as well as possible daily fines of up to £60. Inland Revenue said it will automatically assume those filing late will have something to hide.More on this story here.
HIGH TAX GERMANY’S THRIVING BLACK MARKET
Any visitor to modern Germany is struck by the remarkable contrast between the clean, efficient and unmistakably prosperous surroundings and the utter gloom of the locals. It is a palpably rich country that feels itself to be poor. For the past seven years in a row, Germany has been at the bottom of Europe’s growth league, and the German government’s own forecast, which is widely derided as optimistic, of 1.5% growth this year would continue this wretched record.
So why does the place look so good? Because the Germans have stopped being Germans. They are no longer the law-abiding and dutiful citizens of the economic miracle of the 1950s and 1960s. They are fast becoming just like the Greeks and Italians - hitherto Europe’s leaders in that interesting socio-economic phenomenon, the black economy. Last year, says a well-known writer on the subject, the black economy was worth 16.5% of Germany’s GDP, or $400 billion. In Berlin, the black economy was 22% of the economy. More than three-quarters of all construction work in Berlin was on the black. The Germany economy grew last year by less than one percent. The black economy grew by over 6%. He concludes that it has now become “one of the most stable pillars of our economy.”More on this story here.
SO NEAR YET SO FAR: A CELLPHONE ROAMER IN LATIN LANDS
Judging from the reporter’s recent experience, roaming has a way to go before carriers in the United States and Europe can confidently market worldwide roaming capabilities to their customers. For the time being much of Latin America remains off the roaming map, helping to illustrate the sharp contrasts between city and countryside that still define much of Latin America.More on this story here.
IRS OFFERS OFFSHORE CREDIT CARD AMNESTY
Taxpayers hiding income by using foreign-issued credit cards and bank accounts have until April 15 to avoid criminal charges if they come forward, disclose their methods and pay owed taxes. The foreign cards and accounts are legal, but taxpayers are required to report them and to pay taxes on the income and interest. People who come forward will be required to pay back taxes, interest and penalties but will avoid criminal charges if they qualify.
The IRS began obtaining records in 2000 from Visa, MasterCard and American Express to target people for audits and prosecution for tax evasion. The IRS is looking at about 1,000 accounts, some held by prominent and famous Americans, including athletes, entertainers and authors.
Bank secrecy laws in 30 tax-haven countries have enabled people to hide large incomes and evade U.S. taxes. The arrangements work in various ways. Some use foreign-issued debit cards to access the foreign accounts. Some make charges on foreign-issued credit cards, and pay the bills out of the foreign accounts. The government originally estimated that 1 million U.S. taxpayers have such arrangements, though now they say that number is too large.
Taxpayers who avoided $100,000 in taxes in 1999 would have to pay $149,319 in taxes, interest and a penalty of $20,000. Those who do not fess up would pay $217,758, which includes a higher interest and penalties, the IRS said in a statement.More on this story here, here, and here.
IRS Web sites: Offshore Voluntary Compliance Initiative link here. How to participate in the IRS initiative here. IRS Voluntary Disclosure Procedure 2003-11 here (PDF file). U.S. State Department link here.
President Bush will nominate Mark W. Everson, a deputy director of the Office of Management and Budget, to head the IRS. He would be the second successive non-lawyer to head the tax agency after decades of lawyers as commissioners.More on this story here.
CAYMAN EURO BANK TRIAL ENDS WITH SCANDAL
GEORGE TOWN, C.I.: Four defendants, all former bankers, in the Euro Bank money laundering trial were acquitted on Tuesday January 14, bringing an end to one of the most controversial cases in the Cayman Islands’ legal history. In a remarkable twist of events, charges were dropped after the Attorney General informed the court in the presence of the jury that he would not be offering any further evidence against them. The Chief Justice said the outcome is not to be viewed “in entirely only as a technical matter”. The proceedings were marked by some notable irregularities.More on this story here. Full text of the judgment here.
BERMUDA - JEWEL OF THE ATLANTIC
Bermuda might be coming under a lot of scrutiny these days, but it sure is a nice place to live or visit. Since visitors are not permitted to drive rental cars, many rent a scooter.More on this story here.
The Bermuda Monetary Authority announced that 94 new insurance companies were established in Bermuda in 2002, bringing the total established in the jurisdiction since the September 11 terrorist attacks to 151. Of the 94, 52 were captives which are owned or established by a specific parent company to insure its loss exposures.More on this story here.
500,000 ARGENTINES SEEK EU PASSPORTS
BUENOS AIRES: Half a million Argentine citizens with European parents or grandparents want to return to the land of their ancestors, and leave the country’s worst economic and social crisis in its history behind. Czechs, Hungarians, Poles, Slovaks, Lithuanians, Latvians, Estonians, Slovenians, Cypriots and Maltese - the requests began coming in on December 13, when the European Council agreed to incorporate 10 countries of eastern and southern Europe into the European Union beginning May 2004.More on this story here.
JERSEY GOINGS ON
A full-scale investigation into seven Jersey-based investment funds has been launched by the Jersey Financial Services Commission. All seven companies are managed by Aberdeen Asset Management. A director of Aberdeen in Jersey said the company was happy to co-operate and that it had “nothing to hide”.
The Serious Fraud Office has confirmed that it raided the London and Jersey offices of an investment company as part of an inquiry into the alleged “unlawful appropriation of funds” belonging to e-commerce company Izodia. Tading in Izodia’s shares on the London Stock Exchange was suspended.More on this story here and here.
SPANISH FOREIGN MINISTER ATTACKS GIBRALTAR AS A “THREAT” TO EU
Ms. Ana Palacio reportedly urged the Union to harden its stance against Gibraltar, suggesting that EU directives and laws are being flouted by the jurisdiction in a number of areas.More on this story here.
SWITZERLAND FREEZES $36M IN BRAZILIANS’ SWISS ACCOUNTS
The Swiss are investigating several Brazilian citizens suspected of money laundering, and have blocked assets worth SFr50 million ($36.2 million) held in Swiss bank accounts. Details were not provided.More on this story here.
PHILIPPINES FACING FATF SANCTIONS THREAT
Anti-Money Laundering Council Chair Rafael Carlos Buenaventura warned that the country stands to suffer the same fate of Ukraine if it fails to amend its anti-laundering law by the FATF’s February 23 dealine. Among the sanctions that may be imposed are an order to scrutinize all bank accounts held by Filipinos abroad, with an eye toward closing those whose owners cannot justify their purpose or prove beneficial ownership. “In the case of Ukraine, overseas accounts of locals were ordered closed,” he said. FATF gave Ukraine until mid-February to amend its law or face even stiffer sanctions.More on this story here.
NAURU HAS TWO DUELING, SICK PRESIDENTS AND A MAJOR POLITICAL CRISIS
Two presidents - both seriously ill and requiring dialysis - were today claiming to rule the central Pacific republic of Nauru. Nauru, just south of the Equator and 4,400km north of Auckland, New Zealand is home to 12,000 people living on a single 21-square-kilometre plot of land. The island is mostly moonscape thanks to a century of phosphate strip-mining. With the phosphate exhausted and investments failing, the country is virtually bankrupt, and has had nine governments since 1996. The political infighting makes it increasingly unlikely that the jurisdiction will secure removal next month from the FATF’s blacklist of jurisdictions considered vulnerable to money laundering activity.More on this story here and here.
SHIPS FLYING TONGA FLAG OF CONVENIENCE CAUGHT WITH TERRORIST ARMS
Looking around the world for a backwater far from the Middle East, al-Qaeda found what it needed in the South Pacific island state of Tonga. The tiny island, ruled for 145 years by the Tupou clan, is split by family feuds over the spoils of kingship and is often the object of derision by its own people and their Pacific neighbours. In the two years since the Tonga flag first flew, three foreign-owned Tonga have been caught ferrying terrorists, weapons and explosives for al-Qaeda. The US Navy is wary of, and is prepared to stop and search if considered necessary, any of the 62 ships which the CIA has identified flying Tongan flags.
The Tonga government’s attempt to raise revenue by selling the use rights to its flag is the latest in a long line of questionable and buffoonish schemes.More on this story here.
EVER HEARD OF THE REPUBLIC OF LOMAR?
It is an Internet-based micronation, one of dozens proclaiming independence from the governments of the world. Altruists, jesters, earnest mini-secessionists and rogues - what they have in common is a sense of independence, some documentary trappings such as passports and citizenship certificates, and their own Web sites. “The more they talk about us, the more they write about us, the more real we become in the eyes of the world.”More on this story here. Republic of Lomar documents here (PDF file).
BILL TO BAN U.S. INTERNET GAMBLING FILED
WASHINGTON: US Rep. Jim Leach (R-Iowa) has reintroduced legislation to “To prevent the use of certain bank instruments for unlawful Internet gambling, and for other purposes,” and would make it illegal to use credit cards or any form of electronic payment for the (supposedly illegal) offshore activity. Partly as a result of the legislation, Visa, MasterCard and PayPal now refuse to process betting transactions by their members, which is causing major problems for the estimated 1,500 Internet betting and gaming sites, most of which are based in jurisdictions such as Costa Rica.
Leach claims that studies have found that Internet gaming sites are at risk of being used by criminals to launder funds and evade taxes, and provide a direct pipeline of dollars into terrorist hands. “The very characteristics that make the Internet such a valuable resource are also the reasons why it has such a huge potential to impinge on the stability of the American family, American financial institutions and our national security,” Leach said.More on this story here.
Recommended reading for Jim Leach and his ilk: The Totalitarian Impulse. Liberty-minded individuals are so used to criticizing the totalitarianism that emanates from governments that they forget one other source of constant oppression that needs to be dealt with: the tyranny of the masses. Hordes of petty, self-elected Führers run around trying to dictate everyone else’s choices and lifestyles to suit their own preferences and comfort levels.More on this story here.
NEW SOFTWARE TO “CLEAN UP” BANKING SYSTEM
A press release from an Indian software company describes in detail how bank computers decide if your behavior is suspicious. The product has been designed and developed in such a way that it could give various alerts based on transactions, customers, counter-parties, regions, employees, branches, and behavioural pattern. The software can store several watch lists and incorporate all the reports and forms prescribed by the regulatory authorities. It also enables the banks and financial institutions to store voluminous information about each customer for multi-dimensional customer analysis. All this at 600+ transactions per second.More on this story here.
SCAMS: BANK DEBENTURES AGAIN
SAN JOSE: The US government has filed a civil fraud case against a Costa Rican company which purported to offer “prime bank debentures” to unwary investors. The unusual aspect of this case is that the company, Asset Recovery and Management Trust, targeted investor victims of previous investment scams by claiming to be able to help recover the stolen funds, then luring them into further dubious investments.More on this story here.
ST. LOUIS: A former insurance broker charged with scamming investors out of $2.67 million in a foreign bank-note scheme pleaded guilty to fraud in the middle of his trial in federal court. The storyline is familiar: He promised investors returns as high as 120% per year from investments in “secret foreign markets”, claimeding to know the several dozen or so gatekeepers who allow trading in bank notes, called debentures, sold by large foreign banks. (There is no secret market for foreign bank notes.)More on this story here.
The Big Lie: There is a secret banking system where the big banks make astronomical returns, and you cannot participate unless you pool with others or place your money with someone who has an place in “the system”. The U.S. government is covering up this secret banking system. Etc., etc.More on this story here.
The former president of Unique Gems International, Enrique Pirela, pleaded guilty to charges of fraud and money laundering in an international Ponzi scheme that extracted $91 million from people who invested in worthless glass bead stringing businesses. The operation involved lavish parties, 15,000 people, an $85,000 donation to former President Bill Clinton’s reelection (later returned) and an endorsement from the “most powerful psychic in the world”. The company itself and foundations benefiting three directors, all at large, were set up in Liechtenstein.More on this story here.
FATF HEAD COMPLAINS DIRTY CASH BATTLE IS TOUGH
The president of global anti-money laundering organisation FATF painted a grim picture of the battle against terror financing, saying there are no big victories to date and the task was only getting harder. “There is no magical weapon that can solve these problems all at once because the methods used are like a flu virus. They vary constantly and that is why no easy remedies are available and the most effective tool is prevention,” he said in an interview.More on this story here.
BERMUDA LEADER BLASTS I.R.S. CREDIT CARD PLAN
HAMILTON: “There could be a million and one legitimate reasons for a US resident to have a personal Bermuda credit card, for example,” said Bob Stewart, a former chief executive of Shell Bermuda and a local advocate of freedoms of the individual. He described it as a “fallacy”, that a US citizen or resident of the United States could arouse suspicion simply by virtue of possessing a credit card issued through an offshore bank.More on this story here.
THE CRISIS IN CARACAS
The government of President Hugo Chávez has been experiencing parades of protest to his rule, with many of the country’s population of over 24 million filling, rather than lining, the streets of Caracas. The President’s opponents include those from private businesses, trade unions, the media and the church. The country has always managed to keep its head above water but whether President Chávez will be able to do the same is another matter.More on this story here.
BAHAMAS OFFSHORE SERVICES PROSPERS AT EXPENSE OF REST OF ECONOMY
NASSAU: A business leader said that the existence of the offshore sector hindered growth in the “real economy” mainly because it provided pay levels which could not be matched within that economy. Consequently, the country’s best and brightest migrated to that area of employment instead of other areas where their skills could also be utilised.More on this story here.
MALTA E.U. MEMBERSHIP MEANS MORE TAXES
VALETTA: The Labour Leader, Alfred Sant, has declared that the Maltese people should be provided with the true facts on the choices lying before them during 2003. The Nationalist Party is failing to disclose the substantial increase in taxation to be borne by Maltese taxpayers as a result of full EU membership. New taxes to help finance subsidies to the EU’s agricultural sector would, at the same time, damage Malta’s agriculture.More on this story here.
NAURU HAS SQUANDERED ITS WEALTH - NOW WHAT?
A power struggle in Nauru comes amid growing doubts that the world’s smallest republic, having squandered billions of dollars in phosphate earnings, will survive. Stopgap measures - such as switching diplomatic recognition from Taiwan to mainland China in return for assistance - won’t be enough. The citizenry has grown used to government salaries, land rents and royalties as well as a range of benefits made possible by decades of lowly paid imported workers scrapping phosphate from between fossilized coral pinnacles. Hundreds of years of rugged independence, achieved through the growing of crops and fishing, has long since been eroded. With a devastated environment it is doubtful such a lifestyle could be regained in any case. Addiction to processed foods has impaired the health of most inhabitants, who have the world’s highest rate of diabetes.
Because of an official penchant for secrecy, and shame over a series of fiascos, the extent to which investment assets have been mortgaged remains a mystery. Many believe that if debts are set against assets, there is little if anything left in the kitty. National denial has simply become unsustainable.More on this story here.
SOLOMON ISLANDS FOR SALE?
The Solomon Islands are planning to sign a controversial deal with a fugitive businessman to pay-off the country’s foreign debts. The country was bankrupted by a four-year-long civil war. The offer comes from the man who headed the U-Vistract Finance Company in the 1990s in which tens of thousands of Pacific islanders invested an estimated A$300 million, after being promised returns of 100% after one month and up to 1,000% after one year.More on this story here.
SECURITY FOR TOURISTS: A FAKE RHODESIAN PASSPORT
Montreal-based security company Consultant Executif announced Tuesday it would begin to offer camouflage passports - replica documents for non-countries such as Rhodesia or the British Honduras that the company says may save the lives of citizens in a terrorist situation. For US$950 customers will also get two corroborating pieces of photo identification and a driver’s licence issued for the same nonexistent country.
“They may target you because you are an American or Canadian,” said the president of Consultant Executif, “But you can say: ‘No, I’m not an American, I’m from the British Honduras.’ We thought it was a great product. It could, in certain situations, maybe save your life.”More on this story here.
ARE THE US AND EU CREATING COMPETING CONTINENTAL FORTRESSES?
A fortress continent is a bloc of nations that joins forces to extract favourable trade terms from other countries, while patrolling their shared external borders to keep people from those countries out. But if a continent is serious about being a fortress, it also has to invite one or two poor countries within its walls, because somebody has to do the dirty work and heavy lifting. It is a model being pioneered in Europe, where the European Union is currently expanding to include 10 poor eastern bloc countries.
It took the events of September 11 for North America to get serious about building a fortress continent of its own. Bush officials do not talk much about the continental fortress, preferring terms like “North American area of mutual confidence”. But a US-run security perimeter is precisely what is being built. Washington is constructing a kind of three-tiered fortress in which the US rules by decree, Canada and Mexico serve as guards, and Mexican workers are banished to the continental equivalent of the servants’ quarters.More on this story here.
US OFFENDING, ANTAGONIZING NORTHERN NEIGHBOR IN MANY WAYS
More on this story here. (Reasonably unintrusive registration required.)
IRAQ: LOOK BEFORE WE LEAP
Among the problems that have affected modern Iraq, and that will affect any effort to reconstitute a post-Saddam Iraq, are the borders of the country, cobbled together mostly by the British after the defeat of the Turkish-based Ottoman Empire as a side effect of World War I. (The borders did not include a usable port on the Persian Gulf, a factor in Saddam’s decision to invade Kuwait in 1990.) They also yielded a country that is about 76% Arab and 19% Kurdish, with a sprinkling of Turkoman, Assyrians, Armenians and others.More on this story here.
THE PERILS OF PAX AMERICANA
The world has changed dramatically, but the US still retains its historical ambitions to shape the political destinies of any region or nation it deems important to its interests. Bush’s visions are only the logical culmination of policies that began with president Harry Truman in 1947. The dilemma that the US has confronted since then is that the political and social outcome of its interventions cannot be predicted. There have always been limits to US power, and the question today is when and how the US will acknowledge this reality. Well-know foreign policy author and analyst Gabriel Kolko elaborates.More on this story here.
U.K. INLAND REVENUE SEEKS OFFSHORE TAX EVASION
LONDON: The UK’s Inland Revenue announced this week that it plans to crack down on the thousands of British investors and savers who open accounts overseas in order to avoid paying UK tax on their income. Unnamed “sources close to the Revenue” suggested to the Times that there is a “major fiddle going on”.More on this story here.
NEW WAYS TO MOVE CASINO CASH ONLINE
The refusal of credit card companies and PayPal to allow payment for Internet offshore gambling means that alternative funding methods are needed if one is going to persist in the activity. Various means are discussed - some of which may not last.More on this story here.
STILL MORE BANK SPYING SOFTWARE
SAS Institute, a private software company which employs nearly 9,000, is aiming to be a big player in the anti-money-laundering software field. The “Patriot Act” extends anti-money-laundering requirements beyond banks to a breadth of financial institutions, such as credit-card companies, brokerages and insurance companies, for the first time. For $3 million SAS will install a system that cleans institutions’ customer databases and checks for duplicate accounts or addresses. The scouring clearly shows the institution which customers have what accounts, and checks for seemingly random or spastic movements of money, such as simultaneously buying a stock and selling it short - actions that can mix clean with dirty monry.More on this story here.
5 U.S. CITIES WHERE FOREIGN INVESTORS BUY MOST
San Francisco ranked fifth behind Washington, New York, Los Angeles, and Chicago for foreign investment real estate dollars, according to a survey of offshore investors.More on this story here.
BUSH TAX CON JOB?
Charlie Reese dispenses advice and opinion rapid file:
Any tax cut without an equivalent spending cut is a con job. Whatever money the tax cut provides will have to be paid back with interest. What it spends it has to get by taxing us or by borrowing from that great fraud, the Federal Reserve System. Guns and butter, a la LBJ, puts it all on the cuff for future generations to pay.
Meanwhile, somebody ought to tell all of Washington that an economy whose main problem is excess capacity will not perk up by handing out piddling amounts of cash to consumers who are up to their ears in debt from having already bought far more than they need of just about every adult toy you can think of. He suggests alternatives [which at least have the virtue of being entertaining].More on this story here.
The Bush administration has done one thing very, very right when it comes to economic policy — and it is about time they got some credit for it. This administration has begun to successfully take on the greatest economic challenge of the new century, one that was universally thought to be politically impossible to even touch - Social Security. Throughout the 2000 presidential campaign, Bush spoke of radically reforming Social Security by using personal investment accounts. In an economic platform marked by blandness and timidity, this plank stood out as uniquely imaginative and revolutionary — and he did not forget after he was elected.More on this story here.
U.S. CONGRESS EYES PENTAGON DOMESTIC SPIES
Critics fear the military research “Total Information Awareness” project could lead to government probes of computer databases on everything from civilians’ credit-card transactions to their purchases of airline tickets. Sen. Tom Harkin (D-Iowa) wrote to the Senate’s subcommittee on defense appropriations demanding that Poindexter be called before Congress to testify on the “secretive” program, John Poindexter’s role in its development, and possible privacy violations.
Last week, Sen. Patrick J. Leahy (D-Vt.) and other Democrats sought information from Attorney General John Ashcroft about any ties between the Justice Department and the project. Sen. Russell Feingold (D-Wis.) will introduce legislation calling for the suspension of data-mining efforts until Congress “has completed a thorough review” of the Poindexter program.More on this story here and here.
ANTI-TERROR WAR IGNORES CIVIL LIBERTIES LOSS
Annual Human Rights Watch report hits US rights abuses. Many countries resent or are reluctant to join the U.S. war on terrorism partly because of Washington’s tendency to ignore human rights in its conduct of the war. In several key countries involved in the campaign against terrorism, such as Pakistan and Saudi Arabia, even rhetorical U.S. support for human rights has been rare. When the United States does try to promote human rights, its authority has been undermined by its refusal to be bound by the standards it preaches to others.More on this story here.
“ERASED, REFORMATTED” HARD DRIVES HOLD INFORMATION
Easing and/or reformatting a hard disk does not destroy any data. It just erases the pointers to the data stored in the file allocation table, so that the files and directories are no longer accessible through a file manager (such as Windows Explorer). To truly erase the underlying data stronger measures are required.More on this story here. (Reasonably unintrusive registration required.)
INTERNET PROVIDERS MUST GIVE INFO TO GOVERNMENT UNDER NEW LAW
Previously, ISPs and other companies that store electronic communications were required to disclose confidential information only when presented with probable cause - the Fourth amendment guarantee that the information is connected to a crime and is likely to be found at the search site. Under the Homeland Security Act, however, companies can disclose information based on the good faith belief of “an emergency involving danger of death or serious physical injury to any person” - a loose requirement that relies in this case on the discretion of the ISP.More on this story here.
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