Which Way’s Up?

They missed Nevada, Wyoming, Delaware . . .

It seems that the banking laws in offshore tax havens are a little too strict for some in the U.S.   Apparently you have to give your name.  But that can all be taken care of with a simply romp to  . . . .Wyoming?  That’s right.  In Wyoming you can start a shell business anonymously and start a bank account for that business, also anonymously.  From the Economist article:

For shady clients, this is a far better proposition: what their bankers do not know, they can never be forced to reveal.

Ah yes.  Well if there’s a market for such things someone should make money off of it right?  The free market at work.

Nowhere is this more prevalent than in America. Take Nevada, for example. Its official website touts its “limited reporting and disclosure requirements” and a speedy one-hour incorporation service. Nevada does not ask for the names of company shareholders, nor does it routinely share the little information it has with the federal government.

There is demand for this ask-no-questions approach. The state, with a population of only 2.6m, incorporates about 80,000 new firms a year and now has more than 400,000, roughly one for every six people. A study by the Internal Revenue Service found that 50-90% of those registering companies were already in breach of federal tax laws elsewhere.

So all this time our shady citizens were taking their money to Switzerland, while the Swiss’ shady citizens were coming back to America.  

A money-laundering threat assessment in 2005 by the federal government found that corporate anonymity offered by Delaware, Nevada and Wyoming rivalled that of familiar offshore financial centres. For foreigners, America is a particularly attractive place to stash cash, because it does not tax the interest income they earn. Thus with both anonymity and no taxation, America offers them all the elements of a tax haven.

It seems the Caymans were just a slight of hand from the rich, and Obama fell for it.

On the campaign trail, Obama several times cited a single building in the Cayman Islands called Ugland House which notionally houses 12,000 corporations. He said: “That’s either the biggest building or the biggest tax scam on record.”

What about the 400,000 corporations in Nevada?  The 1-in-6 ratio?  That’s either the most CEO infested state in the Union or its the biggest tax scam in history.

Which Way's Up? Obama, Politics Corruption, Obama, Politics, risk-free investments, taxes