Tag: Corruption Wow

$ 750 Million Missed in DRC

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A poisonous blend of debasement and bungle in Democratic Republic of Congo’s incomes organizations and state mining organizations is draining a fifth of all mining incomes far from the state spending plan, Global Witness uncovers today. Its report ‘Administration Cash Machine’ demonstrates that in any event $750 million disappeared more than three years – cash that ought to have been utilized on fundamental open administrations for the Congolese individuals.

The discoveries come during a period of extraordinary political turmoil in Congo as the beset President Joseph Kabila sticks to control. “Congo’s mining incomes ought to be lifting its kin out of destitution, yet rather colossal totals are being siphoned far from general society tote and into unaccountable offices headed up by individuals with binds to political elites,” said Pete Jones, Global Witness Senior Campaigner.

Congo is Africa’s best copper maker and the world’s greatest provider of cobalt, which is utilized as a part of the lithium-particle batteries that power electric autos and amidst a value blast. Regardless of this, Congo stays one of the poorest nations on the planet. ‘Administration Cash Machine’ examinations the most recent information from the Extractive Industries Transparency Initiative (EITI), which uncovers that in the vicinity of 2013 and 2015 over $750 million of installments by mining organizations to Congo’s assessment offices and state mining organizations never achieved the national treasury. That figure ascends to a surprising $1.3 billion when other state bodies and a now-outdated commonplace assessment body are incorporated.

“A portion of the exchanges we’ve taken a gander at illustrate these organizations as a money machine for Kabila’s administration”, said Jones. “In the event that Congo is to abstain from losing the faith into strife and disorder, genuine straightforwardness and responsibility is required all through the mining segment and in the assessment organizations,” Jones said.

The discoveries come as Congo slips assist into political vulnerability. The nation is wracked by on-going political brutality and distress, following Kabila’s refusal to venture down from control notwithstanding an established mandate. A key reason for discontent with the administration is the ceaseless absence of subsidizing by the legislature in fundamental administrations, for example, schools, healing centers and streets.

“For quite a long time Global Witness and others have archived how incomes have spilled from Congo’s mining segment into seaward shell organizations. Presently we can see that even incomes paid to government bodies in Congo are disappearing before they achieve the treasury,” Jones included.

A key offender in this preoccupation of assets is the principle state-claimed mining organization, Gécamines. It gets more than a hundred million dollars every year from privately owned businesses in Congo’s mining part, however seems to pass on only a modest rate of that to the state coffers. Gécamines’ most imperative and lucrative business connections are with significant worldwide mining organizations, which regularly have Western financial specialists and benefits tied up in their benefits and dangers.

While its commitments to Congo’s open satchel are little, Gécamines sufficiently discovered cash to pay off immense advances from Dan Gertler, a dear companion of President Kabila. One of Gertler’s organizations was reimbursed in the meantime as Gécamines’ staff went unpaid and more seasoned advances stayed extraordinary.

Congo’s duty offices are likewise to fault. Current law enables them to keep down a rate of the fines they exact, which has prompted ruthless lease looking for conduct and created fines as they try to expand the amount they can keep as their own particular assets. The greater part of this adds up to a type of authorized debasement.

The Congolese constitution expresses that each Congolese individual has the privilege to appreciate the advantages of the nation’s national riches, and that the state has an obligation to redistribute that riches evenhandedly and ensure the privilege to advancement. To by far most of Congolese, those are unfilled words. A long time of fumble and debasement inside Gécamines, consolidated with a divided duty framework, imply that the framework is interested in manhandle by political elites trying to remove money from the mining division.

“The best way to put a conclusion to the redirecting of these indispensable assets is to revamp the divided duty framework and to demand full straightforwardness from Gécamines. We have to know the amount it wins, the amount it pays to the treasury, and what it spends its cash on,” said Jones.

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Mountaga Bah fought to save his home from foreclosure in the 4th U.S. Circuit Court of Appeals and lost.  Now, he has the opportunity to reopen the case, due to a conflict of interest uncovered in a Center investigation. (Jared Angle) 
Dear Reader, Imagine — in order to save your home from foreclosure, you must win a legal battle against the banking giant, Wells Fargo. You lose the case. Then you discover one of the deciding judges owned stock in the bank. Would that feel like justice to you?

This scenario is a reality for a Maryland resident, and is just one example of many conflicts of interests discovered in a recent Center investigation, Juris Imprudence.

We looked at the three most recent years of financial disclosures filed by 255 appellate court judges and discovered 24 cases where judges owned stock in a company with a case before them.

Thanks to your support of this time-consuming work, our journalists were able to shine a light on injustice. But we need your help to continue.
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Your support creates real impact. When the Center notified the judges of our findings, 16 judges sent letters to the parties in all of the cases we discovered, admitting to the mistake. These letters are the first step in possibly reopening the cases and giving people a chance at a fair trial.

Federal appellate court judges are incredibly influential. They can strike down or uphold a president’s healthcare law, change how the Internet works and determine how universities admit students. Their decisions affect us all. That’s why I’m confident that you will donate to our 2014 Annual Fund and invest in our ability to hold these powerful figures accountable. 
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Corrupt Chinese Money – Die geheimen Reichtümer der korrupten China-Kommunisten enthüllt

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Leaked Records Reveal Offshore Holdings of China’s Elite

offshore leaks china
Illustration: Tim Meko

Files shed light on nearly 22,000 tax haven clients from Hong Kong and mainland China.

Note: A Chinese version of this story is available here

Close relatives of China’s top leaders have held secretive offshore companies in tax havens that helped shroud the Communist elite’s wealth, a leaked cache of documents reveals.

The confidential files include details of a real estate company co-owned by current President Xi Jinping’s brother-in-law and British Virgin Islands companies set up by former Premier Wen Jiabao’s son and also by his son-in-law.

Nearly 22,000 offshore clients with addresses in mainland China and Hong Kong appear in the files obtained by the International Consortium of Investigative Journalists.  Among them are some of China’s most powerful men and women — including at least 15 of China’s richest, members of the National People’s Congress and executives from state-owned companies entangled in corruption scandals.

PricewaterhouseCoopers, UBS and other Western banks and accounting firms play a key role as middlemen in helping Chinese clients set up trusts and companies in the British Virgin Islands, Samoa and other offshore centers usually associated with hidden wealth, the records show. For instance, Swiss financial giant Credit Suisse helped Wen Jiabao’s son create his BVI company while his father was leading the country.

The files come from two offshore firms — Singapore-based Portcullis TrustNet and BVI-based Commonwealth Trust Limited — that help clients create offshore companies, trusts and bank accounts. They are part of a cache of 2.5 million leaked files that ICIJ has sifted through with help from more than 50 reporting partners in Europe, North America, Asia and other regions.

Since last April, ICIJ’s stories have triggered official inquiries, high-profile resignations and policy changes around the world.

Until now, the details on China and Hong Kong had not been disclosed.

The data illustrates the outsized dependency of the world’s second largest economy on tiny islands thousands of miles away.  As the country has moved from an insular communist system to a socialist/capitalist hybrid, China has become a leading market for offshore havens that peddle secrecy, tax shelters and streamlined international deal making.

Every corner of China’s economy, from oil to green energy and from mining to arms trading, appears in the ICIJ data.

Xi Jinping and Wen JiabaoXi Jinping and Wen Jiabao: relatives appear in ICIJ’s data.

Chinese officials aren’t required to disclose their assets publicly and until now citizens have remained largely in the dark about the parallel economy that can allow the powerful and well-connected to avoid taxes and keep their dealings secret. By some estimates, between $1 trillion and $4 trillion in untraced assets have left the country since 2000.

The growing onshore and offshore wealth of China’s elites “may not be strictly illegal,” but it is often tied to “conflict of interest and covert use of government power,” said Minxin Pei, a political scientist at Claremont McKenna College in California. “If there is real transparency, then the Chinese people will have a much better idea of how corrupt the system is [and] how much wealth has been amassed by government officials through illegal means.”

Top-level corruption is a politically sensitive issue in China as the country’s economy cools and its wealth gap continues to widen.  The country’s leadership has cracked down on journalists who have exposed the hidden wealth of top officials and their families as well as citizens who have demanded that government officials disclose their personal assets.

In November, a mainland Chinese news organization that was working with ICIJ to analyze the offshore data withdrew from the reporting partnership, explaining that authorities had warned it not to publish anything about the material.

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READ: HOW WE WORKED TO REPORT THIS STORY SECURELY IN CHINA
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ICIJ is keeping the identity of the news outlet confidential to protect journalists from government retaliation. Other partners in the investigation include the Hong Kong newspaper Ming Pao, the Taiwanese magazine CommonWealth and the German newspaper Süddeutsche Zeitung.

The ICIJ team spent months sifting through the files and the leaked lists of offshore users. In most cases, names were registered in Romanized form, not Chinese characters, making matching extremely difficult. Many offshore users had provided a passport as well as an address when they set up their companies, which made it possible to confirm identities in many but not all cases. Some suspected princelings and officials in the files could not be confirmed and have not been included in this story.

Along with the China and Hong Kong names, ICIJ’s files also include the names of roughly 16,000 offshore clients from Taiwan. ICIJ will continue to publish stories with its partners in the next few days and will release the Greater China names on its Offshore Leaks Database on Jan. 23.

Who’s Who in China’s Offshore Circles: Tap to see where the money goes

Graphic: Chris Zubak-Skees. Illustrations: Jesús Pérez. Photos: AP, Ming Pao, Angélica Rivera de Peña (CC BY-SA), World Economic Forum (CC BY-SA) and White House. The Red NobilityThe WealthyDeng JiaguiBrother-in-law of President Xi Jinping Wen YunsongSon of former Premier Wen JiabaoLiu ChunhangSon-in-law of former Premier Wen Jiabao Hu YishiFirst cousin once removed of former President Hu Jintao Li XiaolinDaughter of former Premier Li Peng Wu JianchangSon-in-law of paramount leader Deng Xiaoping Che FengSon-in-law of a former central bank governorWang ZhiSon of a former vice presidentWang JunSon of a former vice presidentFu LiangSon of one of ‘Eight Elders’ of the Communist Party Yeh Shuen-jiNephew of one of PRC’s founders Wang JingjingGrandaughter of a former vice presidentSu ZhijunGrandson of one of best-known PLA commandersMa HuatengCo-founder of Internet giant TencentYang HuiyanChina’s richest womanZhang XinCo-founder of property developer SOHO China Zhang ZhidongCo-founder of Internet giant TencentShen GuojunChairman of Yintai GroupJia YuetingChairman of web video giant Leshi Huang GuangyuJailed founder of GOME appliances chainDu JuanGOME executive and wife of founder Lu ZhiqiangChairman of OceanwideLi JinyuanChairman of Tiens GroupDai ZhikangFounder of Zendai Investment Group Du ShuanghuaChairman of Rizhao Holding Group Ma JianrongChairman of Shenzhou InternationalWen YiboFounder of Sound GlobalShi ZhengrongFounder of solar-panel maker SuntechZhou ZhengyiJailed Shanghai property developer

Princelings go offshore

China’s Politburo Standing Committee is the all-powerful group of seven (formerly nine) men who run the Communist Party and the country. The records obtained by ICIJ show that relatives of at least five current or former members of this small circle have incorporated companies in the Cook Islands or British Virgin Islands.

China’s “red nobility” — elites tied by blood or marriage to the current leadership or Party elders — are also popularly known as “princelings.” Ordinary Chinese have grown increasingly angry over their vast wealth and what many see as the hypocrisy of officials who tout “people-first” ideals but look the other way while their families peddle power and influence for personal gain.

The leaked offshore records include details of a BVI company 50 percent owned by President Xi’s brother-in-law Deng Jiagui. The husband of Xi’s older sister, Deng is a multimillionaire real estate developer and an investor in metals used in cell phones and other electronics. The records show the other half of Excellence Effort Property Development was owned by yet another BVI company belonging to Li Wa and Li Xiaoping, property tycoons who made news in July by winning a $2 billion bid to purchase commercial real estate in Shenzhen.

Since taking over as the Communist Party’s top official in 2012, Xi has sought to burnish his image with an aggressive anti-graft campaign, promising to go after official corruption involving both low-level “flies” and high-level “tigers.” Yet he has crushed a grassroots movement that called for government officials to publicly declare their assets. Wen Jiabao, who stepped down as premier in 2013 after a decade-long tenure, also styled himself as a reformer, cultivating an image of grandfatherly concern for China’s poor.

The ICIJ offshore files reveal that Wen’s son Wen Yunsong set up a BVI-registered company, Trend Gold Consultants, with help from the Hong Kong office of Credit Suisse in 2006. Wen Yunsong was the lone director and shareholder of the firm, which appears to have been dissolved in 2008.

Bare-bones company structures are often created to open bank accounts in the offshore firm’s name, helping obscure the relationship to the real account owner. It isn’t immediately clear from the documents what Trend Gold Consultants was used for. A U.S.-educated venture capitalist, Wen Yunsong co-founded a China-focused private equity firm and in 2012 became chairman of China’s Satellite Communications Co., a state-owned firm that aspires to be Asia’s largest satellite operator.

ICIJ made repeated attempts to reach Wen Yunsong and other individuals named in this story. Only a few responded. Wen was among those who did not. Citing confidentiality rules, a Credit Suisse spokesman said the bank is “unable to comment on this matter.”

The ICIJ files also shed light on the BVI’s previously unreported role in a burgeoning scandal involving Wen Jiabao’s daughter, Wen Ruchun, also known as Lily Chang. The New York Times has reported that JPMorgan Chase & Co. paid a firm that she ran, Fullmark Consultants, $1.8 million in consulting fees. U.S. securities regulators are investigating the relationship as part of a probe into the bank’s alleged use of princelings to increase its influence in China.

Fullmark Consultants appears to have been set up in a manner that obscured Wen Ruchun’s relationship to the firm, the ICIJ files indicate. Her name does not show up in any of the incorporation documents in the ICIJ data, though a ‘Lily Chang’ is CC’d in one August, 2009 email correspondence about the company. Her husband Liu Chunhang, a former Morgan Stanley finance guru, created Fullmark Consultants in the BVI in 2004 and was the sole director and shareholder of the firm until 2006, the same year he took a government job at the agency that regulates China’s banking industry.

Liu transferred control of the company, the ICIJ files show, to a Wen family friend, Zhang Yuhong, a wealthy businesswoman and colleague of Wen Jiabao’s brother. The Times reported that Zhang also helped control other Wen family assets including diamond and jewelry ventures.  

The ICIJ files show that offshore provider Portcullis TrustNet billed UBS AG for a certificate of good standing for Fullmark Consultants in October 2005, indicating a business relationship between Fullmark and the Swiss bank. In response to ICIJ’s questions, UBS issued a statement saying its “know-your-client” policies as well as procedures to deal with politically-sensitive clients are among “the strictest in the industry.” Liu and Zhang did not respond to ICIJ’s requests for comment.

A 2007 U.S. Department of State cable passed along a source’s tip that Premier Wen was “disgusted with his family’s activities,” and that “Wen’s wife and children all have a reputation as people who can ‘get things done’ for the right price.” The cable, part of the Wikileaks document dump, reported that Wen’s kin “did not necessarily take bribes, [but] they are amenable to receiving exorbitant ‘consulting fees.’ ”

The records also include incorporations by relatives of Deng Xiaoping, former Premier Li Peng, and former President Hu Jintao.

China experts say that the growing wealth and business interests of the princelings, including offshore holdings, are a dangerous liability for the ruling Communist Party but that people in leadership positions are too involved to stop it.

“What’s the point of running the Communist Party if you can’t get a couple billion for your family?” said Steve Dickinson, a China-based American lawyer who has investigated fraud cases involving BVI companies. “The issue is enormous and has tremendous significance for China, and the fact that everybody dances around it and doesn’t want to talk about it is understandable but scandalous.” 

China embraces offshore

The story of China’s involvement with the offshore world begins with paramount leader Deng Xiaoping’s deepening of economic reforms in the early 1990s. 

Laws reorganizing China’s economy drove many Chinese offshore because they were written with state-owned enterprises in mind, not fledgling ventures like the entrepreneur trying to “market the latest iPhone app,” according to Don Clarke, a China specialist at the George Washington University Law School in Washington, D.C.

Western bankers, accountants and investors wary of doing business on strictly Chinese terms also pushed the offshore model.

“It was us, the foreigners, that imposed this,” said Rocky Lee, head of the Greater China corporate law practice of Cadwalader, Wickersham & Taft. “It had to do with the foreign investors’ general discomfort with Chinese rules and regulations.”

Other factors — including tightened capital controls within China as a result of the 1990s Asian debt crisis — also nudged Chinese offshore. Many had flocked to Hong Kong, then still a British territory, to incorporate businesses. As the 1997 handover back to China approached, though, Hong Kong itself began to look risky and many companies sought more far-flung offshore destinations.

The British Virgin Islands became a favorite haven for Chinese wanting to move businesses and cash offshore.

China’s tax regime favored foreign investment, helping fuel the push to incorporate in the BVI and other offshore centers. Some Chinese manufacturers, for example, reduced their taxes by a maneuver known as “round-tripping” — setting up subsidiaries outside the country, then selling their products at low cost to the subsidiaries, allowing the parent companies to avoid taxes by showing little or no profits inside China. The offshore entities in turn resold the goods at profitable markup — then slipped the profits back to the parents as untaxed “foreign investment” from the BVI or Hong Kong.

Today 40 percent of the BVI’s offshore business comes from China and other Asian nations, according to BVI authorities.

Every corner of China’s economy, from oil to green energy and from mining to arms trading, appears in the ICIJ data

Frank Savage, the BVI’s governor from 1998 to 2002, says the islands helped cultivate the relationship by persuading Chinese authorities that they were a “well-regulated territory with a robust and sound legal system.”

Critics of the offshore system, though, see the BVI in a different light — as a “no-questions-asked” haven for shadowy dealings. Tax Justice Network, an advocacy group, says BVI offshore entities have been linked to “scandal after scandal after scandal” — the result of a corporate secrecy regime that creates an “effective carte blanche for BVI companies to hide and facilitate all manner of crimes and abuses.”

Among the important Chinese who went offshore in the late 1990s was Fu Liang, the son of Peng Zhen, one of the “Eight Elders” of the Communist Party and a top leader of the National People’s Congress in the 1980s.

Offshore Leaks records show Fu — who has invested in yachting clubs and golf courses on the mainland — controlled at least five offshore companies established in the BVI between 1997 and 2000. He used one of them, South Port Development Limited, to acquire a Philippines hotel in 2000.

TrustNet, the offshore services provider, helped Fu set up some of his offshore companies. By 2000, Trustnet was among the offshore services firms that were making an all-out drive to sign up clients from China, doing marketing meetings at the Shanghai offices of what were then known as the “Big 5” accounting firms: KPMG, Ernst & Young, Pricewaterhouse, Deloitte & Touche, and Arthur Andersen.

The audit firm now known as PricewaterhouseCoopers helped incorporate more than 400 offshore entities through TrustNet for clients from the mainland, Hong Kong and Taiwan, the ICIJ records show. Swiss banking giant UBS helped set up more than 1,000 offshore structures via TrustNet for clients from those three markets.

UBS Hong Kong helped Yang Huiyan, China’s richest woman, with an estimated net worth of US$ 8.3 billion, establish a BVI company in 2006. Yang, who inherited a real estate fortune from her father, did not respond to questions about her offshore company, Joy House Enterprises Limited.

The following year the Swiss bank referred another Chinese real estate billionaire, Zhang Xin, to TrustNet. Zhang, founder of Soho China, a company that has reshaped much of the Beijing skyline, recently made headlines by buying a $26 million Manhattan townhouse.  Through a representative, Zhang declined to answer questions about her BVI company Commune Investment Ltd., a name similar to that of her exclusive boutique hotel outside Beijing, the Commune by the Great Wall.

Li Jinyuan, a business tycoon and philanthropist with a net worth estimated at $1.2 billion in 2011, was director of seven BVI companies that PricewaterhouseCoopers helped incorporate between 2004 and 2008. According to the ICIJ files, the BVI companies appear to be connected to his Tiens Group conglomerate, which has interests in biotechnology, tourism, e-commerce and real estate.

In a 2005 marketing memo marked “strictly private and confidential,” TrustNet staffers were encouraged to improve ties with Credit Suisse in Hong Kong. They courted Credit Suisse and UBS with wine and cheese sessions. On the mainland, where foreign banks were restricted, they took a different tack: “In Shanghai, we will target international law firms and accounting firms,” the 2005 memo says.

The marketing campaign paid off. The number of companies TrustNet set up for clients in China, Hong Kong and Taiwan tripled from 1,500 to 4,800 between 2003 and 2007.

The TrustNet clients who incorporated companies during this period include two current delegates to the National People’s Congress, China’s legislature.

Wei Jianghong, who represents Anhui province in the legislature while serving as chairman of state-owned Tongling Nonferrous Metals, was a director of Tong Guan Resources Holdings, a BVI company set up in 2006. Tongling used Tong Guan to invest $10 million in a $50 million copper processing project in Chile in 2007.

Another delegate with offshore holdings is Ma Huateng, the founder of China’s leading online chat company, Tencent. Ma is worth $10 billion and is ranked No. 5 on Forbes’ list of billionaires in China. In 2007, he became director of TCH Pi Limited in the BVI with fellow Tencent founder Zhang Zhidong.

A spokeswoman for Ma said TCH Pi is a Tencent company that “has nothing to do with [Ma or Zhang] personally,” but the firm doesn’t show up in Tencent corporate filings, and its purpose isn’t clear.

Profits and corruption

Things have changed dramatically for China since it first dipped its toe into the offshore world. The country is wealthier and offshore centers serve increasingly as channels not only for capital that “round-trips” out of the country and back again, but also for overseas investment and accessing markets for metals, minerals and other resources.

Defenders of China’s offshore push say the offshore system has helped boost the country’s economy.

“I think we should face the reality, which is that Chinese capital is flowing out. I think it’s actually a beneficial thing,” said Mei Xinyu, a researcher at China’s Commerce Ministry. “Of course I support the idea that a company should incorporate in its host country. But if the host country can’t provide the right environment, then incorporating the company in an offshore center is actually a practical choice.”

With markets in China often hamstrung by red tape and government intervention, incorporating offshore can smooth the way to do business, said William Vlcek, author of Offshore Finance and Small States: Sovereignty, Size and Money.

There’s also evidence, though, that many Chinese companies and individuals have used offshore entities to engage in illicit or illegal behavior.

In September Zhang Shuguang, a former high-level Chinese railway executive, pleaded guilty to criminal charges in the wake of allegations that he’d funneled $2.8 billion into offshore accounts. An internal government report released by the Bank of China revealed that public officials — including executives at state-owned companies — had embezzled more than $120 billion out of China since the mid-1980s, some of it funneled through the BVI.

Portcullis TrustNet helped state-run shipping giant Cosco incorporate a BVI company in 2000. Among the numerous directors of Cosco Information Technology Limited were current Cosco Group chairman Ma Zehua and Song Jun, an executive who would stand trial in 2011 for embezzlement and bribery. After Cosco sent Song to help oversee a Qingdao subsidiary in 2001, he set up a fake BVI joint venture partner and used it to siphon millions from the building of Qingdao’s gleaming Cosco Plaza, prosecutors said. State news service Xinhua said he embezzled $6 million, took $1 million in bribes from a Taiwanese business partner and purchased 37 apartments in Beijing, Tianjin and Qingdao with his ill-gotten earnings. His trial was adjourned but no verdict was publicly announced.

China’s corruption-plagued oil industry — which recently has been the target of criminal investigations that have led to the suspension of key oil executives — is a big player in the offshore world. China’s three big state-owned oil companies, which are counted among the largest companies in the world, are linked to dozens of BVI firms that show up in the ICIJ data.

Former PetroChina executive Li Hualin, who was dismissed in August after coming under investigation for alleged “serious violations of discipline”, often a party shorthand for corruption, was the director of two BVI companies, the ICIJ files reveal.

While some of these offshore firms are disclosed in corporate filings, several others linked to individual executives — including Zhang Bowen of PetroChina’s natural gas distribution arm Kunlun Energy and Yang Hua of China National Offshore Oil Corporation — appear to operate in the dark, and their purpose is not clear. PetroChina and CNOOC did not respond to ICIJ’s repeated requests for comment.

Other scandal-tainted Chinese who have used the BVI to do business include Huang Guangyu, once China’s richest man. The ICIJ records show that he and his wife Du Juan set up a maze of at least 31 BVI companies between 2001 and 2008 as they built the largest consumer electronics retail chain in China.

The husband, Huang, was sentenced to 14 years in prison in 2010 after Chinese courts convicted him of insider trading, bribery and stock price manipulation. Du Juan was convicted of related charges but was released from prison in 2010 after serving a brief time.

While Huang is in prison and many of his assets are frozen, his business empire survives through his offshore network of companies. In 2011, one of his BVI firms, Eagle Vantage Assets Management, made a bid for a retired British aircraft carrier that Huang wanted to turn into a luxury shopping mall (the Brits in the end decided to scrap the ship).

He still owns more than 30 percent of Gome, his electronics retailer, via two companies in the BVI, Shining Crown Holdings and Shine Group.

Offshore’s future

As concerns grow about the wealth of corporate oligarchs, government officials and their families, some Chinese have braved the government’s anger by raising questions about corruption.

A grassroots group, the New Citizens Movement, uses the Internet and small demonstrations to press for greater transparency. “How can you fight corruption if you don’t even dare to disclose your personal assets?” the group’s founder, legal advocate and activist Xu Zhiyong, wrote last spring.

The government’s response has been swift. It has arrested Xu and detained more than 20 other members of the group, indicting some for “disturbing public order” or “illegal assembly,” charges frequently used to silence dissidents.

The government has also cracked down on foreign media that have focused attention on the gap between wealth and poverty in China. After The New York Times and Bloomberg News reported on the onshore assets of China’s princelings, the government blocked their websites and delayed approving visas for their journalists.

After years of inaction, the U.S., the U.K. and international organizations have begun pushing reforms that, they say, would reduce offshore abuses. China has been less aggressive in pressing for changes in the offshore system.

Big loopholes in tax laws have allowed Chinese individuals to operate with relative freedom offshore. They weren’t required to report their foreign holdings.

“Chinese policy makers didn’t envision individuals absconding with that much money,” Lee, the Beijing-based corporate lawyer, said.

Now mainland authorities are moving to get a handle on the flow of private wealth offshore. New rules that went into effect Jan. 1 require Chinese to report their overseas assets.

How aggressively China joins global efforts to reshape the offshore system may have a big impact on the current push for reform. Just as China has become an increasingly important player in the global economy, it has also become more important as a supplier of clients to the market for offshore accounts and companies.

A 2013 industry-sponsored poll of 200-plus bankers and other offshore professionals found that “China-related demand” is the key driver in the offshore market’s growth. The chief of a BVI offshore services firm said in the survey: “China is the most important location for client origination for business in the next five years.”

Contributors to this story: Margot Williams and David Donald

Die bezahlten Reisen und Immobilien von Thomas und Beate Porten /GoMoPa

Bernd-Pulchernst

Liebe Leser,

nach vorliegenden Unterlagen wurden über zwei Jahrzehnte Reisen von Thomas Porten, IZ, Gesellschafter und Chefredakteur von der Immobilienzeitung durch Immobilienfirmen  bezahlt. Ebenso von Dr. Rainer Zitelmann, dem “Auschwitz-Experten”.

Anzeigen und Abonnements sowieso in Millionenhöhe für Thomas Porten und Beate Porten, Wirtschafts-Staatsanwältin in Wiesbaden:

Niemand wusste dies ausser Porten und Porten oder ?

Dss Haus von Beate und Thomas Porten in Mainz wurde wohl mithin ebenfalls von Immobilienfirmen bezahlt, ebenfalls Hotelaufenthalte und Urlaubsreisen.

Bis zur Aufklärung dieser Korruptionsaffäre habe ich allen Einnahmden aus Deutschland entsagt  und wenn dies 100 Jahre dauert !.

Kann das die Gegenseite und ihr korrupter Haufen auch ?

Herzlichst Ihr

Magister Bernd Pulch

PS Wieviel die mutmasslichen Porten-Genossen der GoMoPa erhalten haben können Sie im Manager Magazin, der SZ und der Zeit nachlesen.

Documentary – The Pain Project: Bureaucrats

The laws governing illicit drugs, enforced by UN Office of Drugs and Crimes, are unnecessarily blunt and curtail access to legitimate opiates for medical purposes. This segment is part of The Pain Project, a series produced by The International Reporting Program.

For more on The Pain Project series:
Imagine recovering from major surgery or suffering from advanced cancer without any painkillers. That’s the reality for patients in half the countries in the world. But unlike with so many global health problems, this one is not about money or a lack of drugs. Morphine, the gold standard for medical pain treatment, is simple and cheap to make and distribute. So why are so many people left in pain?

The International Reporting Program traveled to Ukraine, Uganda and India to find out, and to document the human toll of this hidden human rights crisis. It turns out a combination of bureaucratic hurdles and the chilling effect of the global war on drugs are largely to blame, leaving humanitarians scrambling to work outside the law — or change the law — to bring relief to suffering patients all over the world.

For more information visit:
http://www.internationalreporting.org…

Unveiled – Consultant for Willbros International Sentenced in Connection with Foreign Bribery Scheme

WASHINGTON—A former consultant for Willbros International, Inc. (Willbros International), a subsidiary of Houston-based Willbros Group, Inc. (Willbros), was sentenced today for his role in a conspiracy to pay more than $6 million in bribes to government officials of the Federal Republic of Nigeria and officials from a Nigerian political party, Acting Assistant Attorney General Mythili Raman of the Criminal Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office announced today.

Paul G. Novak, 46, was sentenced today to serve 15 months in prison by U.S. District Judge Simeon T. Lake, III of the Southern District of Texas. The court took into consideration Novak’s cooperation, and the sentence was consistent with the government’s recommendation. In addition to the prison sentence, Novak was ordered to pay a $1 million fine and to serve two years of supervised release following his release from prison. In sentencing Novak, the court took into consideration the assistance Novak provided the government in ongoing investigations.

Novak pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA) and one substantive count of violating the FCPA. Novak admitted that from approximately late 2003 to March 2005, he conspired with others to make a series of corrupt payments totaling more than $6 million to various Nigerian government officials and officials from a Nigerian political party to assist Willbros and its joint venture partner, a construction company based in Mannheim, Germany, in obtaining and retaining the Eastern Gas Gathering System (EGGS) Project, which was valued at approximately $387 million. The EGGS project was a natural gas pipeline system in the Niger Delta designed to relieve existing pipeline capacity constraints.

According to court records, Novak and his alleged co-conspirators, Kenneth Tillery, Jason Steph, Jim Bob Brown—three employees from Willbros’ joint venture partner—and others agreed to make the corrupt payments to, among others, government officials from the Nigerian National Petroleum Corporation, the National Petroleum Investment Management Services, a senior official in the executive branch of the federal government of Nigeria, and members of a Nigerian political party. Court documents state the bribes were paid to assist in obtaining and retaining the EGGS contract and additional optional scopes of work.

According to information contained in plea documents, to secure the funds for those corrupt payments, Novak and his alleged conspirators caused Willbros West Africa Inc., a subsidiary of Willbros International, to enter into so-called “consultancy agreements” with two consulting companies Novak represented in exchange for purportedly legitimate consultancy services. In reality, those consulting companies were used to facilitate the payment of bribes.

In addition to Novak, to date, two Willbros employees have pleaded guilty for their roles in the EGGS bribery scheme, and Willbros has entered into a deferred prosecution agreement with the government:

On May 14, 2008, Willbros Group, Inc. and Willbros International entered into a deferred prosecution agreement with the government and agreed to pay a $22 million penalty in connection with the company’s payment of bribes to government officials in Nigeria and Ecuador. On March 30, 2012, the government moved to dismiss the charges following Willbros’ satisfaction of its obligations under the deferred prosecution agreement, and on April 2, 2012, the court granted the United States’ motion.

On September 14, 2006, Jim Bob Brown, a former Willbros executive, pleaded guilty to one count of conspiracy to violate the FCPA, in connection with his role in making corrupt payments to Nigerian government officials to obtain and retain the EGGS contract and in connection with his role in making corrupt payments in Ecuador. After a reduction for cooperation, Brown was sentenced on January 28, 2010 to 12 months and one day in prison, two years of supervised release, and a $17,500 fine.

On November 5, 2007, Jason Steph, also a former Willbros executive, pleaded guilty to one count of conspiracy to violate the FCPA in connection with his role in making corrupt payments to Nigerian government officials to obtain and retain the EGGS contract. After a reduction for cooperation, Steph was sentenced on January 28, 2010 to 15 months in prison, two years of supervised release and a $2,000 fine.

Kenneth Tillery was charged, along with Novak, for his alleged role in the bribery scheme in an indictment unsealed on December 19, 2008. According to the indictment, Tillery was a Willbros International employee and executive from the 1980s through January 2005. From 2002 until January 2005, Tillery served as executive vice president and, later, as president of Willbros International. Tillery remains a fugitive. The charges against Tillery are merely accusations, and he is presumed innocent unless and until proven guilty.

The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad. Significant assistance was provided by the Criminal Division’s Office of International Affairs. This case is being prosecuted by Senior Trial Attorney Laura N. Perkins of the Criminal Division’s Fraud Section.

Additional information about the Justice Department’s FCPA enforcement efforts can be found at http://www.justice.gov/criminal/fraud/fcpa.