Basic Guide of factors that contribute to money laundering
A checklist of factors that contribute to making a country or jurisdiction particularly vulnerable to money laundering or other illicit financial activity, however, provides a basic guide.
The checklist includes, but is not limited to:--
- Failure to criminalize money laundering for all serious crimes or limiting the offense to narrow predicates.
- Rigid bank secrecy rules that obstruct law enforcement investigations or that prohibit or inhibit large-value and/or suspicious or unusual transaction reporting by both banks and non-bank financial institutions.
- Lack of or inadequate know-your-customer ( KYC with AADHAR card number ) requirements to open accounts or conduct financial transactions, including the permitted use of anonymous, nominee, numbered, or trustee accounts.
- No requirement to disclose the beneficial owner of an account or the true beneficiary of a transaction.
- Lack of effective monitoring of cross-border currency movements.
- No reporting requirements for large cash transactions.
- No requirement to maintain financial records over a specific period of time.
- No mandatory requirement to report suspicious transactions, or a pattern of inconsistent reporting under a voluntary system, and a lack of uniform guidelines for identifying suspicious transactions.
- Use of bearer monetary instruments.
- Well-established non-bank financial systems, especially where regulation, supervision, and monitoring are absent or lax.
- Patterns of evasion of exchange controls by legitimate businesses.
- Ease of incorporation, in particular where ownership can be held through nominees or bearer shares, or where off-the-shelf corporations can be acquired.
- No central reporting unit for receiving, analyzing, and disseminating to the competent authorities information on large-value, suspicious, or unusual financial transactions that might identify possible money laundering activity.
- Lack of or weak bank regulatory controls, or failure to adopt or adhere to the Basel Committee’s “Core Principles for Effective Banking Supervision,” especially in jurisdictions where the monetary or bank supervisory authority is understaffed, under-skilled, or uncommitted.
- Well-established offshore financial centers or tax-haven banking systems, especially jurisdictions where such banks and accounts can be readily established with minimal background investigations
- Extensive foreign banking operations, especially where there is significant wire transfer activity or multiple branches of foreign banks, or limited audit authority over foreign-owned banks or institutions.
- Jurisdictions where charitable organizations or money or value transfer systems, because of their unregulated and unsupervised nature, are used as avenues for money laundering or terrorist financing.
- Limited asset seizure or confiscation authority.
- Limited narcotics, money laundering, and financial crime enforcement, and lack of trained investigators or regulators.
- Jurisdictions with free trade zones where there is little government presence or other supervisory authority.
- Patterns of official corruption or a laissez-faire attitude toward the business and banking communities.
- Jurisdictions where the U.S. dollar is readily accepted, especially jurisdictions where banks and other financial institutions allow dollar deposits.
- Well-established access to international bullion trading centers in New York, Istanbul, Zurich, Dubai, and Mumbai.
- Jurisdictions where there is significant trade in, or export of, gold, diamonds, and other gems.
- Jurisdictions with large parallel or black market economies.
- Limited or no ability to share financial information with foreign law enforcement authorities.
What is a bearer share?
When shares are bought and sold, a registered shareholder name is included on share certificate details. Bearer shares bypass this by not including the name of the holder on a physical share certificate. Because there is no name is attached to them, the details of who owns a shareholding in a company is concealed.
In addition, the certificates can be transferred from one party to another without further documentation. Bearer shares help to conceal ultimate beneficial ownership by “providing a deep level secrecy”.
Following pressure for greater transparency from the Organisation for Economic Co-operation and Development (OECD), they are in steady decline. British Virgin Island companies were banned from issuing them in 2005 .
In Panama a corporation can own its own bank accounts, have stock trading accounts, own real estate, have boats, planes, cars, art, jewelry, own other businesses, and many other valuable assets.
This can all be done without anyone ever being able to prove who the true owner of all those things really is. In the eyes of the public it is all set up to belong to the bearer share corporation.
Bearer bonds normally come in nice large round figures It is very handy if you want to move vast amounts of money around and great if you want to deny ownership. If the bond is kept at a lawyer's office in Panama, who is to know whether it is yours, or even that it exists?
This helps to explain why the US government stopped selling bearer bonds in 1982. They were just too easy for crooks to use.
If you are a drug dealer, arms broker getting kickbacks or fraudster or corrupt politician you will have a lot of cash and no way of spending it or hiding it for a rainy day, without giving the game away.
The money needs cleaning, so you can ship it to a dodgy firm in an Offshore Financial Centre and they might help you convert it into bearer bonds, owned by a shell company that no one knows about. You could also use it to buy a yacht or a bungalow in London
The former President of Zambia, Frederick Chiluba, transferred millions of dollars of public money from the Zambian Ministry of Finance into bank accounts and companies for his own personal use. A British Virgin Island company with bearer shares was used to buy property in Brussels for one of the people involved in this $25 m scam.
To enforce privacy and secrecy, Panama has set up stringent laws
In Panama, no approval is needed to create a foundation and unlike in Western countries, the foundation faces few requirements as to what it must list publicly (usually just the foundation’s name, its objective, and provisions concerning how it is to be “wound up” if say, it is dissolved).
Details about the beneficiaries and the operation of the foundation are not made public. To enforce privacy and secrecy, Panama has set up stringent laws to protect the anonymity of offshore trusts and foundations.
For example, violation of laws of confidentiality can result in imprisonment for up to six months and fines of up to $50,000.
All those involved in the formation of a trust or foundation in Panama (including lawyers, foundation members, agents, and bankers) who fail to adhere to these laws face criminal penalties.
PM MODI SHOULD HAVE DISMANTLED SHELL COMPANIES "BEFORE" DEMONETIZATION NOT "AFTER"
THERE IS NO WISDOM IN LOCKING THE STABLE DOORS AFTER THE HORSES HAVE BOLTED
The government had expected that over 4 lakh crores of black money would be ‘extinguished’ from circulation, thus lightening the debt burden on the RBI which could then have passed this windfall onto public sector banks stressed by bad loans, or non-performing assets (NPAs).
Most of the BAD loans from Indian banks have been given to desh drohis who siphoned off the money to foreign lands using SHELL companies- to but industries, hotels etc . They now employ and give pensions to the white man using the hard earned money of the poor Indian who slogs his ass off.
SOME OF THE LOANS FROM INDIAN BANKS FUNDED LTTE, NAXALS, KHALISTANIS, ,ISLAMIC TERRORISTS , MAFIA etc.
NO ONE KNEW A SHIT ABOUT HOW SHELL COMPANIES CAN BE USED TO MAKE THESE LOANS DISAPPEAR – AND HOW PEOPLE WHO TOOK LOANS DECLARE BANKRUPTCY.
CASHEW IMPORTERS FROM NIGERIA WERE GIVEN HUNDREDS OF CRORES BY “INDIAN BANK” OF TAMIL NADU ( CHID BABYs FRIEND CMD-M GOPALAKRISHNAN CASE ) -- USED BY LTTE TO BUY FOREIGN ARMS
A big percentage of all currency that was demonetised has come back into open circulation as white money.
ARE WE STUPID?
DON’T OUR NATIONAL SECURITY AGENCIES HAVE AN IOTA OF BRAINS ? ARE THEY BABES IN THE WOODS?
AND WHY IS AXIS BANK PUNISHING THEIR ERRANT BANK MANAGERS BY “SUSPENSIONS” .
IS MODI NOT SUPPOSED TO INCARCERATE THEM?
One of channels for converting black money into white are shell companies.
EVERY ARMS MIDDLEMAN IN INDIA OPERATES DOZENS OF SHELL COMPANIES.
OUR GOVT DOES NOT EVEN HAVE A LIST OF ARMS DEALS WHO OPERATE SHELL COMPANIES—AFTER ALL THESE POLITICIANS GET KICKBACKS AND THEY TOO OPERATE SHELL COMPANIES
The IT dept had seized huge quantity of Panama’s bearer shares from Sanjay Bhandari’s premises in Delhi during the raid in April 2016.
I had explained about BEARER SHARES in part 1 of my post , at the end ..
Panama’s bearer shares are untraceable certificates of ownership and a mode to stash away black money in the tax haven. Such bearer shares ensure anonymity of the owner. Bhandari baby operated dozens of SHELL companies
Bhandari was not on radar till the I-T officials raided a Delhi-based hawala operator, Deepak Agarwal, in a case related to funding Aam Aadmi Party in July 2015. During the raid, I-T officials recovered a number of bogus bills, worth Rs 100 crore, in the name of Sanjay Bhandari.
This led to a separate tax survey for Bhandari’s 20 shell companies. This is when I-T officials found some suspicious entries and defence ministry’s documents. His phone was put on surveillance and then emerged his nexus with politicians, senior journalists and defence officials.
I-T department has focussed on Bhandari’s three main companies and his foreign accounts. These include his Delhi-based flagship company Offset India Solutions Pvt Ltd, which was floated in 2008 with paid-up capital of just Rs one lakh; Micromet Ati India Pvt Ltd, which had subscribed to Panama bearer shares; and Ayaana Software and Services Pvt Ltd, which was allegedly used for money laundering.
Shell or Drop-box companies in India
When black money needs to be made white, a shell company will show some business transaction through which it earned a small profit, below the taxable limit. This money is then paid to another company, or to an individual, in the form of a consultancy fee, or other professional charge.
The extent of this laundering process is vast.
According to a report based on information obtained from the Registrar of Companies, there are over 1,33,000 such shell companies, or drop-box companies, in India, with Kolkata being home to many of them.
A single one-room office in New Delhi’s Nehru Place has no fewer than 75 such companies operating from it. There are shell companies in Mumbai and Surat, too, but Kolkata became the epicenter since the 1980s.
In law enforcement circles, domestic shell companies have a nick name, “Kolkata companies”. The city still is the epicentre of the shell-company industry.
Adjoining West Bengal’s seat of power, the Writers Building, the narrow bylanes of the Lal Bazar area is a mini tax haven in itself. From here, 180 drop box addresses and 11,130 companies are functioning.
In every scam, shell companies are used for pay-offs and inevitably it involves Kolkata-based shell companies.
One of the oft-cited reasons on why Kolkata flourished was because operators in the city charged less commission—most operated by crypto Jew marwaris who were ex-opium drug running agents of Jew Rothschild.
How An Indian Shell Company Operates
An Indian company, registered under a shell company typically located in Kolkata, can start by importing something costly—say some machinery for one lakh dollars. The company quotes an infated price of 10 times more.
The manufacturer of the machine or its suppliers may not want to produce a fake voucher with the inflated price. Therefore, another shell company will be set up offshore . It will first import the machine at the original price, and then sell it to the Indian company for one million.
No one will have an inkling about the fact that the offshore shell company is also related to the promoters. The Indian company next remits one million to the offshore shell. This is done through a banking channel
There is NO need for heavy machinery. It can just be a pack of DVDs containing some bullshit software –touted as some deadly intellectual stuff. You can import software - get a shell offshore company to send a packet of useless CDs.
You declare that you have received a proprietary software and it costs half a million dollar. Even on a small scale, you can remit the money abroad. The claim is backed up by the invoice and a genuine courier.
There are about 92 tax havens. One can move money from India to say Cayman Islands, then Panama and so on and finally, to Switzerland (a country that one-third of the world's private wealth). You keep closing the shell companies once the money is transferred. This layering process hides the real beneficiary of an account.
That is why the Bofors kickbacks could never be tracked.
Colbar Investments was a shell company of which Quattrocchi was the "economical owner". That transferred money to a series of shell companies ending finally in the Guernsay Islands..
During Rajiv Gandhi’s tenure as Prime Minister that UNCLE Quattrocchi spread his wings – wielding enormous powers over Indian Ministers and top bureaucrats. These minions would stand up when spaghetti UNCLE came into their rooms.
AE Services, the shell company that Quattrocchi operated, was a late entrant to the Bofors deal. Bofors at that time had existing contractual arrangements (going back several years, even decades) with two strands of companies in which arms agent Win Chadha and the Hinduja brothers – GP Hinduja and Srichand Hinduja – had interests.
AE Services , a shell front for spaghetti UNCLE was entitled to a commission only if the Bofors deal with India was signed before 31 March 1986. It was a measure of the supreme confidence that Quattrocchi had and was able to communicate to Bofors, that such a contract was signed at all. Tellingly, the Bofors deal was signed on 24 March 1986, a week short of the deadline.
What is the root cause of black money?
The obvious answer is dishonesty.
No honest desh bhakt person needs a SHELL company. If a man operates a SHELL company—it just means he is a crook .
But what causes people to be dishonest are taxes, which they want to avoid.
It is better to abolish INCOME TAX. This will cause a big percentage of SHELL companies to die a natural death.
Do away with personal income tax and we’ll do away with a significant amount of black money, as all personal earnings will be tax-free and fully legitimate.
In black-and-white terms, detaxation might be the only permanent solution to black money.
As many as 48 million individuals were tax assessees in the assessment year 2014-15, or 3.79 percent of India's population. The data further reveal that there are just over 1.33 million income-tax assessees in India declaring income of more than Rs 10 lakh per year.
Hawala and diamonds are a way for Indians looking to transfer cash abroad. Since Indian laws have restrictions on carrying cash of over Rs 20 lakh, except in special circumstances such as medical treament, the most common method is to wear or carry diamond jewellery of, say, Rs 100 crore, and fly to Dubai.
The diamonds can then be sold and the cash deposited in a bank. The banking system in Dubai, typically, asks no questions. Once the money is in the banking channel, the process of layering follows,
Today, Dubai is the world's third-largest diamond trading hub. Dubai is not a diamond polishing hub. If so --why is it importing or exporting as much? No one is looking into it.
Hawala transactions are even easier. The customer pays a simple fee to the Hawala agent and gets the money out to his chosen jurisdiction. This hawala system works of trust—with no paperwork .
When an HONEST NRI cannot do his 184 days outside India he prefers to send his CLEAN HARD EARNED money by Hawala route to avoid getting taxed as a NON- NRI. It is NOT used to save a few dollars of banking transfer charges. The money gets delivered at the doorstep by a courier within 60 minutes, no Saturdays NO Sundays, in Kerala ..
This is why black money and gold jewellery was hoarded in India before demonitisation—benami land too.
The World of Shadow Banks
http://timesofindia.indiatimes.com/city/mumbai/Rs-2000-crore-hawala-scam-unearthed-in-Mumbai/articleshow/53904414.cms
—the world of shadow banks that make small loans, sometimes against gold, but usually without requiring any collateral.
Governments make great efforts to ensure that global banks comply with anti-money-laundering rules, while this shadow financial system is barely policed. That must change. Governments could start by making it a criminal offence to enable tax evasion by others.
The term "Black Money" is not easy to define as it may have the characteristics of chameleon, changing its colour to suit the purpose, ...
It’s legal for Indian residents to hold money in foreign bank accounts as long as they disclose it and pay taxes. Some undisclosed money is moved out of the country through hawala,. Using hawala is illegal in India.
Shell companies set up in tax havens are used to route some of the cash back to India by investments in stock markets through participatory notes, foreign direct investments and other instruments
GMR has the dubious distinction of being one of the most indebted companies in the country. GMR has forayed into sports by promoting the Indian Premier League (IPL) cricket team – Delhi Daredevils.
GMR has about 40,000 crore debt and the ratio of that debt to its ebitda — or earnings before interest, depreciation, taxes and amortisation — is 6.8 times. A SHADOW BANK recently stepped in and gave the cash-strapped company a loan of more than $200m.
Though Kerala is one of the best-banked States, there exists a strong parallel illegal credit system, too. These ‘blade companies’ charge extremely high rates of interest, often ranging from 120 per cent to 300 per cent a year.
These companies often employ goondas to recover money from the borrowers. Many murders, lynching and suicides are linked to these companies.
The term “shadow bank” was coined in 2007 by Paul McCulley of PIMCO, a big bond fund to describe risky off-balance-sheet vehicles hatched by banks to sell loans repackaged as bonds. Today, the term is used more loosely to cover all financial intermediaries that perform bank-like activity but are not regulated as one.
These include mobile payment systems, pawnshops, peer-to-peer lending websites, hedge funds and bond-trading platforms set up by technology firms. Among the biggest are asset management companies.
Sometimes your own SHADOW BANK gives a loan to YOU . Jew Rothschild buys his own art or wine to increase its value.
Loans can be used as an excuse to declare bankruptcy
MAJJA HAI. KISSI KOH KUCHCH NAHIN PATHA !
Bankruptcy Fraud
Bankruptcy fraud is a white-collar crime that takes four general forms.
- First, debtors conceal assets to avoid having to forfeit them.
- Second, individuals intentionally file false or incomplete forms.
- Third, individuals sometimes file multiple times using either false information or real information in several states.
- The fourth kind of bankruptcy fraud involves bribing a court-appointed trustee. Commonly, the criminal will couple one of these forms of fraud with another crime, such as identity theft, mortgage fraud, money laundering, and public corruption.
Nearly 73 % of all bankruptcy fraud involves the concealment of assets
Creditors can only liquidate those assets listed by the debtor; thus, if the debtor fails to reveal certain assets, the debtor can keep the assets despite having an outstanding debt. To further conceal the assets, businesses or individuals may transfer these unrevealed assets to friends, relatives, or an associate so that the asset cannot be located. This type of fraud raises the risk and costs associated with lending and becomes passed on to others who wish to borrow money.
Multiple filing fraud consists of filing for bankruptcy in multiple states, using the same name and information, using aliases and fake information, or some combination thereof. Multiple filings slow down the court systems’ ability to process a bankruptcy filing and liquidate the assets. Often, multiple filings provide more cover for a debtor trying to engage in the concealment of assets.
In essence, a shell corporation exists mainly on paper, has no physical presence, employs no one, and produces nothing. Within more sophisticated concealment strategies the perpetrators may employ the use of an office or employees to provide the illusion of a legitimate business entity. Scandals range from thousands to millions of dollars and always result in embarrassing moments for the company and management.
Again, illegal activities generally carried out by a shell company includes tax evasion, bankruptcy frauds, fake services schemes, market manipulation and money laundering.
IT poster boy Ramalinga Raju ( Satyam)
HEY –
HOW MANY OF YOU ARE SMART ENOUGH TO HIDE ALL YOUR PROFITS IN YOUR ASSHOLE , AVOID PAYING TAX AND TAKE LOANS FROM YOUR OWN ASSHOLE ?
IT poster boy Rmalinga Raju ( Satyam) had 13,000 fictitious employees. He manipulated the accounts by billions of USD.
Satyam company misrepresented its accounts both to its board, stock exchanges, regulators, investors and all other stakeholders. It is impossible to misrepresent such facts without the connivance of the auditors and some executive board members.
A web of 356 investment SHELL companies was used to allegedly divert funds from Satyam.· These companies had several transactions in the form of inter-corporate investments, advances and loans within and among them.
The cash so raised was used to purchase several thousands of acres of land across Andhra Pradesh to ride a booming realty market. The properties, bought in the name of some 80 shell companies, included prime commercial plots in and around Hyderabad, Bangalore, Chennai and Nagpur.
Raju and nine accomplices skimmed more than $2.5 billion from the company, Satyam insiders forged board resolutions to secure $260 million in bank loans which were diverted for personal use, and over several years generated fake customer identities and account statements to inflate Satyam's revenues by millions of dollars, boosting the company's share price and making its books look far healthier than they were
AND RAJU BABY GETS A FAKE DOCTORs CERTIFICATE STATING THAT HE IS SUFFERING FROM DEADLY HEPATITIS C
Switzerland has a host of companies that provides professional services to manage the wealth of high networth individuals across the world.
ROTHSCHILD Services can range from acting as professional trustees of trusts to incorporating companies and holding structures.
They provide administrative services, including directors and secretaries for these companies, and that of the trusts. Other services include assistance while meeting with bankers.
EVER HEARD OF REVERSE MERGERS ?
A reverse merger is the acquisition of an already public company (usually a dormant shell) to avoid the Initial Public Offering (IPO) process and cost, to quickly get your startup on a public exchange for fund raising through visibility and selling stock.
They make sure the SHELL they choose is squeaky clean. Other than raising money, the reverse merger may be the quickest way to get you to other benefits of a public company. These include
- the ability to offer meaningful stock options to employees,
- the use of liquid shares to purchase other companies, and
- the credibility and public access to information you need to attract key customers and suppliers.
A public shell company is used by a private entity to go public. This arrangement is used to go public quickly and at minimal cost.
The legal structure used for this merger is called a reverse triangular merger. The process flow for a reverse triangular merger is:
- The shell company creates a subsidiary entity.
- The newly-formed subsidiary merges into the private company that is buying the shell.
- The newly-formed subsidiary has now disappeared, so the private company becomes a subsidiary of the shell company.
The reverse triangular merger is used to avoid the cumbersome shareholder approval process that is normally required for an acquisition.
There are a number of advantages associated with the reverse merger concept, which are:
- If the buyer is not immediately intending to use the shell to raise money from the public, it can take the reverse merger path even in weak stock market conditions.
- Being public means that the stock issued by the combined entity is a more tradable form of currency than the stock of a private company, which makes it easier for an acquirer to engage in stock-for-stock transactions.
- Also, the shares of a public company are frequently valued higher than those of a private one (because the stock is more tradable), so the public company that engages in stock-for-stock purchases can do so with fewer shares.
- The reverse merger path is sometimes pushed by the current shareholders of a business, because they want to have an avenue for selling their shares. This is a particular concern for those shareholders who have been unable to liquidate their shares by other means, such as selling them back to the company or selling the entire business.
- Being public makes the issuance of stock options much more attractive to the recipients. If they elect to exercise their options, they can then sell the shares to the general public, while also obtaining enough cash to pay for taxes on any gains generated from the options.
JEW Rothschild is the TOP CAT in global investment banks for mergers and acquisitions (M&A) advisory. If at all someone is ahead of him, it is because he is a mere front
Rothschild heads Reliance’s Mergers & Acquisitions team.
Rothschild recently wrote a letter to the Supreme Court on behalf of Vijay Mallya that made $40 million of Indian taxpayers money vanish.
Jew Rothschild’a provides the KOSHER WALL. You get fucked if you even touch the wall- forget about breaching it .
If somebody is conducting an investigation he cant get a shit or do a shit.
Sab mil julke , barabbar bhaantke , khaaa raha hai !
EVER WONDERED WHY INDIA ALLOWS GAMBLING IN GOA ?
CHAKKAR KYA HAI BHAIYYA ?
FIRST OF ALL DRUG AND CASINO MONEY GETS LAUNDERED HERE
Goa state is the only one in India that permits both electronic onland casinos as well as live offshore ones. The ship CASINO ROYALE is always infested with white skinned JEWS.
In Goa entry to casino is unrestricted, no screening as such. Names will just be asked for entry, no ID documents or AADHAR CARD NUMBER asked for. A small band like thing would be tied to your hands.
Small denomination of coins would be given with the entry fee paid inducing you to play.
There is no limit on how much coins can be purchased by paying cash, for high end customers, who pre-book and have a package deal of accommodation as well, there is an option to wire transfer the funds to the casino account
The winnings are subjected to TDS (Tax Deducted at Source) under section 194 B of Indian Income Tax Act, 1961 , ...However in no case you can see any TDS deducted from any payments made to customers.
Casinos are money laundering machines..
Macau and Hong Kong are considered Special Administrative Regions of the People's Republic of China, and part of what makes them special is that they are great places to launder cash.
Macau is the casino capital of the world, with seven times more gaming revenue than Las Vegas, and Hong Kong is home to plenty of compliant ROTHSCHILDs banks and other intermediaries willing to transfer funds anywhere in the world without asking too many questions, for a fee.
Gambling tourism is Macau's biggest source of revenue, making up about 52% of the economy. Macau, a special administrative region like Hong Kong, is the only place in China where casinos are legal.
JEW Stanley Ho , the richest man of Macau has been nicknamed "The King of Gambling", reflecting the government-granted monopoly he held on the Macau gambling industry for 40 years.
How It Works!
Let's say you live or work in China and want to hide a massive bribe.
- First, you must convert it from yuan into another currency without the government knowing. The easiest way to do this is to contact a junket, an agent in mainland China who will give you casino chips for your cash, minus fees of up to 20%.
- Take the chips to a friendly, cooperative casino, where you can gamble with them, cash them in for Hong Kong or US dollars to then spend as you see fit, or deposit in a Hong Kong bank branch. Or, for extra safety, take them to a lawyer specializing in offshore laundering.
- Meanwhile, the casino will mix your chips with those from legitimate gamblers, and its accountants will book your $1 million as paid-out winnings.
Casinos are money laundering machines.. More than 300 billion USD in "ill-gotten funds are channeled through Macau each year. Money which is funneled into Macau casinos are mostly bribes , embezzelments and kickbacks ..
Winnings in gambling are taken in USD to invest it in property or offshore tax havens. SHELL company agents of the Chinese mafia TRIAD do everything –all logistics .. They help arrange for visas and accommodations, including VIP rooms.
They also collect gambling debts and make sure police and judiciary don’t bother you.. Triads arrange for drugs and underage girls too.
Illicit money finds its way to Macau's casinos is through pawn shops. Visitors buy goods from a pawn shops with a debit card and then sell it back for cash.
Senator John McCain raised concerns about illicit money from Macau making its way into the American political sphere by pointing out that CEO of Las Vegas Sands Corporation, Sheldon Adelson, got his profits from Macau.
Today, Panama's financial laws remain extraordinarily lax. Foreign firms can bring unlimited amounts of money into the country without paying taxes.
JEWISH American banks helped turn Panama into a financial center, and the country emerged as a tax and money-laundering haven in the 1970s after the government passed some of the world's strictest financial-secrecy rules.
That likely encouraged Mossack Fonseca to establish itself here in 1977. The financial-secrecy rules didn't just promise foreign investors confidentiality—they made it a crime for banks to disclose any information about clients unless they were ordered to by a court in a case that involved terrorism, drug trafficking, or another serious offense (tax evasion was specifically excluded from that category).
Americans are believed to hold more than $1 trillion secreted in offshore havens, with annual losses to the IRS alone coming to some $100 billion.
Financial firms including Rothschild are moving offshore accounts from locations such as Switzerland and Grand Cayman Islands into the U.S. to take advantage of the country’s relative lax regulations.
Nearly half of residential properties purchases of over $5 million made in the U.S. in the last few years were carried out by anonymous shell companies.
SHELF Companies
SHELF companies are legally formed firms, which are inactive but can be purchased to start a business right away. Shell companies that are created without a business or a listing are known as shelf companies.
These companies are then bought by another company which may have some legitimate business but may not want to spend time, money and effort that goes in creating a company.
These are incorporated purely to sell off-the-shelf. A shelf company has a better chance of appearing legitimate and fooling a novice investigator or basic due diligence mechanisms because it appears to have existed longer than it really has.
This offers a convenient alternative to setting up a company from scratch (the name of the company can be changed, new directors appointed, and possibly shares issued).
This offers a convenient alternative to setting up a company from scratch (the name of the company can be changed, new directors appointed, and possibly shares issued).
An older shelf could predate any specific areas of concern, which would allow it to engage in business activities when it otherwise shouldn't.
The age of your company can affect the business you wish to conduct. The number of years a company has been in existence may affect how much confidence potential business associates such as buyers or creditors have in a company.
There's also an opportunity to buy a 'shelf company'. This is a company that has been established a few years earlier. By trading under this company name it will superficially appear your brand new company has a longer track record.
This is particularly useful if you're going for a loan. It can be helpful to have a company that didn't come down in the last shower. And if you're a criminal it can further confuse the trail.
One international asset manager who talked to Mossack Fonseca about doing business said that the firm offered to sell a 50-year-old shelf company for $100,000
Other Benefits
- If you want to obtain bank loans, corporate credit cards, leases and other credit facilities, an aged company will be in better standing than a new incorporation.
- Obtaining a Business Visa or Work Permits for company directors is easier with an established company..
- The company directors will be changed from the nominee staff directors to the directors of your choice as part of the transfer process.
LAYERING
A black money operator opens many shell companies to route money before it is invested. This is called 'layering', and it helps in covering up the money trail.
Assets are rarely in the beneficiary's name and money is moved through jurisdictions where Indian laws are not respected.
Over the years, many such perfectly legal but complex financial systems have evolved that help convert black money from bribes / kickbacks into white.
It is surprisingly easy and cheap to set up a shell company abroad. It costs as less as $500. Some countries allow companies to be set up through websites. Most Indians prefer layering services to be rendered through chartered accountants, lawyers and professional services companies.
In tax havens, professional beneficiary services is an organized industry and are bound by the laws of the land. The chances of these firms perpetuating fraud are negligible and that explains their popularity.
These companies are legal entities and are bound by professional beneficiary agreements, which act on clients' instructions and maintain 100 per cent confidentiality. Since the beneficial owner of the trust is a foreigner, there is no way to know whose money is being handled.
Some banks allow 'numbered accounts', where the account holder is identified by a number rather than his name. Blind shields are created through trusts in these jurisdictions to protect the identity of the ultimate beneficiary. The trust deed always remains a private document.
Many professional services companies advise on converting black money to white. While the money is typically used to buy property abroad, holidaying, gambling , on “healthcare” ( read as sex with beautiful models and children ) and buying jewellery, they are also routed back to India.
Return journey of black money
The return journey of black money typically has a sequence:-
- Money is parked in a trust-friendly jurisdiction, such as Switzerland, before it is moved...
- to a tax-efficient country such as Cyprus, where the taxation levels are very low, or have no taxes.
- It is then routed to a tax-friendly country like Mauritius, before reaching the final destination in India. India has a Double Taxation Avoidance Treaty (DTAA) with Mauritius.
Most sailors know that their monthly allotments ( salaries sent to home bank ) emanate from shell companies offshore.
Banks in India or finance ministry know all these things. All are hand in glove.
