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Thinking Out of the Box
You're, like, so busted...
Weekend Edition
November 15-16, 2008
While the government struggles over which industry segment of the US it will bail out next, it seems some on Wall Street have had their hands out with their fingers crossed behind their back.
On Wednesday, UBS' Global Wealth Management division was found with one of those outstretched hands fiddling about inside the proverbial cookie jar. Imagine that, they are stealing cookies... while the rest of us are forced to sit and finish our spinach and liver.
During a time of such enormous financial upheaval and desperation, it is absurd to find that many of the country's mega rich were actually hiding their money illegally offshore. Not even thinking of paying taxes. Well, of course they were. Such is one of the many benefits of being mega rich.
Ironically, big time investment firm UBS was helping these people to escape the very taxes that regular Americans are forced to pay to bail them out. Is it worse than a vicious circle? Or, just an obvious pain in the backside? Or both?
On Wednesday, UBS Chairman and CEO of Global Wealth Management Raoul Weil was indicted by a Federal grand jury in Florida in connection with the Justice Department's investigation of UBS' cross-border business. The Department of Justice said Weil was charged with conspiring to defraud the Justice Department and the Internal Revenue Service.
Further, according to the New York Times, "the indictment also referred to unindicted co-conspirators who “occupied positions of the highest level of management within the Swiss bank. The individuals, sat on committees that oversaw legal, compliance, tax, risk and other issues. It went on to include unindicted senior bankers, and the managers and “desk heads” who oversaw them."
The Justice Department said that the Swiss UBS, which has large operations in the United States, illegally helped up to 20,000 American clients hide $20 billion in offshore accounts, thereby evading $300 million a year in taxes from 2000 to 2007.
The indictment said that up to 17,000 clients of UBS illegally concealed their names and control of cross-border accounts from the I.R.S. The indictment named up to 20,000 American clients as unindicted co-conspirators, reflecting a new strategy by the Justice Department to tackle the consumers of abusive offshore deals.
This
kind of crime always leaves me speechless but is particularly grating
now, during this time of overarching American broke-ness. Notions of
fairness that float around assertions on taxation policy, taxing the
rich versus taxing the middle class etc... just seem to go out the
window. When many of the wealthy are encouraged not to play by the
rules, you wonder just how many other rules are being broken. Are
average Americans being played as the fool? I wonder...
According to the transcripts, these wealthy clients were no helpless little lambs being led to slaughter. They knew that moving their money offshore and not paying taxes on it was illegal, that is what they hired UBS to do.
So, I don't know about you, but this is not what I want to hear during a time when Wall Street has managed to slice off a few dollars for itself from the bailout, via the Republicans insistence that some of these firms just need a few billion dollars to keep things moving. While the Treasury Department continues to print money and slide it across the desk to the banking industry, many of these firms' offshore money hustle remains in full effect.
What I would like to know is whose names were on that list of 20,000 American clients? Does this mean that regardless of the Obama administration permitting Bush's tax cuts for the wealthy to lapse over the next year, many will still find a way to avoid paying for this mess that has been created, by breaking the law?
