Interesting to speculate on the wealthy accomplices. The US missed (why?, how?) a chance to find out who these guys were (see below note on Credit Suisse)
But really, I gave up reading fiction a long time ago. Too dull. Far better to read about the goings on in the Banking Industry and International finance arena in general, but it does seem to be getting a bit repetitious? For a good read have a look "A game as old as empire", edited by Steve Hiatt....It made me re-read the BCCI Affair, what a Ripping yarn that was...here is the short summary
The
Bank of Credit and Commerce International (
BCCI) was a major international
bankfounded in 1972 by
Agha Hasan Abedi, a
Pakistani financier. The Bank was registered in
Luxembourg (oh no, ,not again!) with head offices in
Karachi and
London. Within a decade BCCI touched its peak. It operated in 78 countries, had over 400 branches, and had assets in excess of
US$20 billion, making it the 7th largest private bank in the world by assets. It was transformed by Pakistani
ISI into "the biggest clandestine money network in history."
The US intelligence agencies used BCCI to funnel drug money to Afghan Mujahideen in their fight against Soviet invasion and to terrorists such as Nicaraguan Contras. After the decline of Soviet Empire when the US no longer needed to fund the Afghan Mujahideen, in the late 1980's BCCI became the target of a two-year undercover operation conducted by the US Customs Service. This operation concluded with a fake wedding that was attended by BCCI officers and drug dealers from around the world who had established a personal friendship and working relationship with undercover Special Agent
Robert Mazur. After a six month trial in Tampa, key bank officers were convicted and received lengthy prison sentences. Bank officers began cooperating with law enforcement authorities and that cooperation caused BCCI’s many crimes to be revealed.
BCCI came under the scrutiny of regulatory bodies and intelligence agencies in the 1980s due to its perceived avoidance of falling under one regulatory banking authority, a fact that was later, after extensive investigations, proven to be false. BCCI became the focus of a massive regulatory battle in 1991 and on July 5 of that year customs and bank regulators in seven countries raided and locked down records of its branch offices.
[4]
Investigators in the U.S. and the UK revealed that BCCI had been "set up deliberately to avoid centralized
regulatory review, and operated extensively in bank secrecy jurisdictions. Its affairs were extraordinarily complex. Its officers were sophisticated international bankers whose apparent objective was to keep their affairs secret, to commit fraud on a massive scale, and to avoid detection."
The
liquidators,
Deloitte & Touche, filed a lawsuit against
Price Waterhouse and
Ernst & Young - the bank's auditors - which was settled for $175 million in 1998. A further lawsuit against the Emir of
Abu Dhabi, a major shareholder, was launched in 1999 for approximately $400 million. BCCI creditors also instituted a $1 billion suit against the
Bank of England as a regulatory body. After a nine-year struggle, due to the Bank's statutory immunity, the case went to trial in January 2004. However, in November 2005, Deloitte convinced creditor Abu Dhabi to drop its claims against the Bank of England, except for a claim for return of its deposits, in that Abu Dhabi owned 77% of the bank shares at closing, and was therefore also facing a major lawsuit.
[2] To date liquidators have recovered about 75% of the creditors' lost money.
[5] A decade after its liquidation, its activities were still not completely understood.
[6]
Then you can go on and update yourself with the next chapter care of Credit Suise,....who were their wealthy clients again???
Justice Department lets U.S. tax evaders escape Credit Suisse net
By Rudolf Elmer, ….
May 20, 2014
Rudolf Elmer is a Swiss whistleblower who has been persecuted by the Swiss justice system for revealing tax evasion facilitated by the Julius Bär Bank in Zurich. He comments on the Justice Department deal with Credit Suisse, whose egregious money-laundering for 22,000 U.S. tax-evading accounts was exposed by Senate hearings led by Sen. Carl Levin. The settlement requires Credit Suisse to pay $2.6 billion in penalties, with no requirement that it turn over the names of U.S. tax evaders. The U.S. could have withdrawn the bank’s license to practice in America. It declined to use that leverage.
It is an exceptionally good deal for Credit Suisse. The fine is about a quarter’s net profits, and that does not hurt CS nor does it have the effect that top management will receive reduced benefits or face a court trial. CS is still too big to jail.
The key matter, however, is that client data has not been provided, and only then can you know if the fine is reasonable or not. There should have been a clause allowing adjustment of the fine if it turns out that the evaded money and other assets are much more than expected. I do not think that such a clause exists in the deal. By the way, that is common business practice if there is uncertainty about a price and only the future will tell how much the real or effective price is, for instance, in the worth of an enterprise.
I think it is an invitation to commit crimes in the U.S., because even if you get caught, there are no drastic penalties to expect. The game will continue. “Let’s do business and just make sure you do not get caught, or, if it becomes an issue, blame the staff!” That’s the attitude, and I would be highly surprised if CS changes its attitude. Obviously, it was a shock, but in two years, things will not be different.
The settlement is even inconsistent with Swiss law. If you have a guilty plea for such a crime in Switzerland, you will lose your Swiss license and management will be taken to court.
It is now up to the Swiss Banking Authority, the FINMA (the Swiss Financial Market Supervisory Authority) and Mark Branson, head of FINMA, to decide if Credit Suisse CEO Brady Dougan and Chairman Urs Rohner or others will lose their professional credibility to work as bankers. However, I do not expect much there, because FINMA is financed by UBS, Credit Suisse and the other big banks.
Lastly, the settlement clearly demonstrates that the UBS deal to pay penalties of $680 million for its tax evasion practices was too low! It was so low, that UBS as of today has provided very little information about clients and has not been punished for that delay. I assume CS will also in the future provide very little information about the 20,000 American clients with a Credit Suisse bank account.
With this sweet deal, the case is no longer in the public eye, which helps CS and Swiss as well as American authorities.
#
Sen. Levin said yesterday that, “t is a mystery to me why the U.S. government didn’t require as part of the agreement that the bank cough up some of the names of the U.S. clients with secret Swiss bank accounts. More than 20,000 Americans were Credit Suisse accountholders in Switzerland, the vast majority of whom never disclosed their accounts as required by U.S. law. This leaves their identities undisclosed, with no accountability for taxes owed.”
LK: No doubt “important people” held some of those accounts.
#
National Whistleblower Center Executive Director Stephen M. Kohn, confirming what Elmer said, pointed out today that, “Despite the fact that UBS’s illegal offshore holdings were twiceas large as Credit Suisse’s, UBS paid a fine of only $780 million, two thirds less then the Credit Suisse penalty. Why did UBS pay such a small penalty in relation to the magnitude of the crimes it committed?”
He says it’s because the Justice Department turned on its own whistleblower, his client Bradley Birkenfeld, and “instead of working with Mr. Birkenfeld to identify all of the bankers and clients involved in the crimes, the Justice Department agreed to a quick and dirty settlement with UBS” and sent Birkenfeld to prison. Kohn says, “Based on the Credit Suisse-DOJ agreement, UBS should have paid back to the taxpayers twice as much as Credit Suisse.”
- See more at: http://www.thekomisarscoop.com/2014...scape-credit-suisse-net/#sthash.uEDSZTeB.dpuf
and from Lucy Komisar
CORRUPTION: U.S. banks abetting corrupt regimes, probe finds
Filed under Banks, Citigroup, offshore, Regulation & enforcement, Scoops. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry
By Lucy Komisar
February 3, 2010
The global bank HSBC may be running offshore accounts for central banks. According to a U.S. Senate investigation, an HSBC subsidiary in London called HSBC Equator Bank had a sister bank in the Bahamas.
According to an internal e-mail, the bank told HSBC USA it had been providing offshore accounts to central banks for 20 years, because the banks wanted to avoid “Mareva” injunctions, legally enforceable orders to freeze funds.
This was revealed by a report to be released Thursday by the Senate Subcommittee on Investigations. A subcommittee staff member who worked on the investigation said, “You have a central bank saying to their banker, I don’t want to have to comply with a legally enforceable order so put me offshore. So they did.”
HSBC declined to confirm or deny the charge. HSBC told IPS, “HSBC takes compliance matters very seriously. HSBC’s record demonstrates a commitment to vigorous enforcement and continuous enhancement of anti-money laundering policies and practices.” It would not comment further.
The committee’s 350-page report of an investigation that lasted two years focuses on how U.S. banks, lawyers, real estate and escrow agents hide the origins of funds belonging to foreign government officials and other “politically exposed persons” (PEPS) who might be moving illicit cash.
Only banks are required under U.S. law to know their customers and reject dirty money. Subcommittee head Sen. Carl Levin will chair a hearing Thursday on how U.S. agents help launder funds into the U.S. banking system.
In the HSBC case, the committee was looking into money transfers from the National Bank of Angola. Other case studies in the report involve Equatorial Guinea, Nigeria and **on.
From 2004 to 2008, Teodoro Nguema Obiang Mangue, son of the president of Equatorial Guinea, employed two lawyers, Michael Berger and George Nagler, to set up U.S. shell companies – Beautiful Vision Inc., Unlimited Horizon, Inc., Sweetwater Malibu LLC, Sweetwater Management Inc., and Sweet Pink Inc. – with no employees or places of business, to open bank accounts and move money. Berger and Nagler will testify at the hearing.
The lawyers used their attorney client and law office accounts to hide the origin of the money and transfer it to an account in Citibank, which would never see a wire transfer from Equatorial Guinea. At this time Obiang was the subject of criminal investigations and complaints in the U.S. and France.
The lawyers moved nearly 30 million dollars in wire transfers to buy a 30-million-dollar residence in Malibu, on the California coast. An escrow agent, the Sidley Austin law firm, sent 900,000 dollars to help purchase the Malibu mansion.
When the law firm inquired of the Justice Department if it was okay to accept the funds, part of a 21-million-dollar transfer that initially was to buy a Gulfstream jet, the department replied it had no basis for seizing the funds, the report said.
Money moved from Obiang’s bank in Equatorial Guinea to a correspondent account at Wachovia Bank which then transferred the funds to Bank of America in Oklahoma City. In a six-month period, about 73 million dollars went through the Wachovia account. Another 37 million dollars went through Citibank.
Committee staff discussed this with the banks. The aide said, “Wachovia said they’ve decided to add Mr. Obiang’s name to the interdiction software just because they don’t want to handle his funds. Citibank has declined to take the same step, because they said they’re afraid they would get so many hits from Obiang that it would require their staff to take an awful lot of time to research those wire transfers.”
A Citibank spokesperson told IPS, “Were not commenting. We were only mentioned a couple of times, so we’ll leave it to the report and decline.”
In the case of BAI, Banco Africano de Investimentos, a seven-billion-dollar private bank whose largest stockholder is Sonangol, the state oil company, the report shows how HSBC ignored basic anti-money laundering rules.
Aside from Sonangol, the banks’ major shareholders are the oil company’s top executives, and the bank’s clients are people in the oil and diamond industry. “We have a PEP bank,” the committee aide said.
BAI opened a correspondent account with HSBC in New York. HSBC tried to find out who owned the bank, which is required by the 2002 U.S. Patriot Act. But 19 percent of the stock was owned by shell companies. And they were being “held” by the bank’s president until purchasers could be found.
After it could not determine the true owners, HSBC dropped the matter, said the report. BAI used HSBC to gain access to its wire transfer system so clients could send and receive U.S. dollar transfers across U.S. borders.
In a Nigeria case, the report described how Jennifer Douglas, the fourth wife of Atiku Abubakar, who was vice-president of that country, helped him bring 40 million dollars in suspect funds into the U.S. Some of it was bribe payments made by Siemens, the German electronics company that paid some two billion dollars in global bribes.
Edward Weidenfeld, Douglas’s lawyer, received funds from offshore accounts and told the committee that he assumed that it was Abubakar’s money. Under the law, he was not required to inquire further.
The late president of **on, Omar Bongo, hired a U.S. lobbyist, Jeffrey Birrell, to arrange to buy an armoured car from a Utah company and to purchase a U.S.-made C130 transport aircraft from Saudi Arabia.
He got U.S. permission for the aircraft deal – required because U.S. military sales require permission for resales – and had no trouble moving money from shell companies for the deal. Along the way Birrell was sending out wire transfers directed by Bongo and his advisors, some to accounts in Brussels, Paris and Malta.
The committee aide said after the plane deal fell through, “President Bongo asked him to send 9.2 million dollars to an account in his name not in **on but in Malta. The lobbyist says okay. That was money from Ayira in **on and he sent 9.2 million dollars to the president in Malta. If that isn’t a suspicious transaction, I don’t know what is.”
Birrell, who used his own accounts as conduits for the funds and would not tell the committee what Ayira was, will testify before the committee.
Sen. Levin, who has been investigating and holding hearings on offshore corruption for at least a dozen years, said at a press briefing Tuesday that corruption “corrodes the rule of law, undermines economic development, it eats away at the fabric of civil society, it destabilises communities, it helps lead to failed states.”
He said that even though banks have become more vigilant, “Foreign officials still get access to our financial system at times because U.S. professionals aid and abet their actions.”
He said the U.S. Treasury Department should revoke exceptions granted in the Patriot Act in that exempted escrow agents and real estate from knowing their customers and turning away suspect clients.
He noted that the American Bar Association had promised eight years ago that it would take action to require attorneys to adhere to anti-money laundering standards. He said, “It’s time they did.”
He endorsed World Bank proposals for controls on accepting funds from politically exposed and powerful persons.
Article on IPS site.
Postscript: At the hearing February 4th, Berger, Nagler (both lawyers for Obiang) and Birrell (registered agent for **on) refused to testify, based on the Fifth Amendment protection against self-incrimination.
Here they are saying “no.”
- See more at: http://www.thekomisarscoop.com/2010...upt-regimes-probe-finds/#sthash.sxT7Okl2.dpuf
and we know how this ended
http://www.bloomberg.com/news/2013-07-02/hsbc-judge-approves-1-9b-drug-money-laundering-accord.html
well it still lingers...
but who needs fiction, and Ian Flemming, ...
