by Richard Clark
|Image: Tracy Collins, Flickr|
As described by Georgetown University bankruptcy expert Adam Levitin, in testimony to subcommittee of the House Financial Services Committee, "If mortgages were not properly transferred in the securitization process, then mortgage-backed securities would in fact not be backed by any mortgages whatsoever, and could obscure the title to nearly every property in the United States." This raises the question of the legality of the resulting millions of foreclosures on American homeowners, since the banks often cannot prove "ownership" of the foreclosed properties.
The statement above gets to the elemental issue that apparently is lost on many otherwise intelligent people. This is not about frivolous claims based on technicalities. This is about securities fraud on a potentially catastrophic scale. These so-called securities (mortgaged-backed?) were sold to governments, pension funds and other financial institutions globally. Trillions of dollars in profits were made by banks selling what is becoming clearly understood to have now become worthless pieces of paper. And when the jig was up -- which ultimately led to the destruction of economies globally -- banksters made ordinary citizens the losers by cleverly sliding their worthless pieces of paper over onto the balance sheets of taxpayers worldwide. This is why they are called banksters, a name they richly deserve.
And while some quibble over whether someone should get a "free house' from a bank, the banksters who have perpetrated the greatest swindle in the history of mankind are about to get away with it! Why? Because their behemoth banks are "systemically important," i.e. they are TBTF (too big to fail).
You think money laundering and tax evasion is a specialty only of Caribbean island "banking centers"? Think again; we have corporate oversight that is on a par with Somalia's.
The USA is a haven for corporate money laundering
The "little house of secrets" on the Great Plains is the headquarters for Wyoming Corporate Services, a business-incorporation specialist that establishes firms which can be used as "shell" companies, i.e. paper entities able to hide assets so as to keep them from being taxed.
Among this firm's offerings is something known as a "shelf" company, which magically comes with years of regulatory filings behind it, providing for a feeling of solidity:
"A corporation is a legal person created by state statute that can be used as a fall guy, a servant, a good friend, or a decoy," the company's website boasts. "It is a "person' you control . . yet who cannot be held accountable for its actions! Imagine the possibilities!"
"In the U.S., business incorporation is now completely unregulated," says Jason Sharman, a professor at Griffith University in Nathan, Australia, who is preparing a study for the World Bank on corporate formation worldwide. "Somalia has slightly higher standards than Wyoming and Nevada."
No surprise then that the US was declared "non-compliant" in 4 out of 40 categories monitored by the Financial Action Task Force, an international group fighting money laundering and terrorism finance, in a 2006 evaluation report, its most recent. Two of those ratings relate to scant information collected on the owners of corporations. The task force named Wyoming, Nevada and Delaware as secrecy havens. Only three states -- Alaska, Arizona and Montana -- require regular disclosure of corporate shareholders in some form.
4. Just as in Greece, taxes are optional for our nation's financial elites. In Greece, to avoid the "swimming pool tax, you simply don't mention your swimming pool" when filling out your income tax forms. Here in the U.S., that sort of tax avoidance is against the law. So here you must hire a sharp tax attorney to escape taxation legally (well, mostly legally).
5. If you are unfortunate enough to be a successful small entrepreneur who nets a mere $100,000 a year, you pay 15.3% self-employment and 25% Federal tax on the bulk of your income, a combined rate of 40.3%, and a combined rate of 43.3% on all income above $82,400. By contrast, those who net millions pay less than half that amount, somewhere between 17%, for the top 1/10th of 1%.
In contrast to what is paid by the top 1/10th of 1% , the small businessperson in California earning $100,000 pays between 5% and 9% state tax, so their combined state and Federal tax burden on their highest earnings is a whopping 50%. Then there are property taxes and the 9.5% sales tax, and endless junk fees that are skimmed from small businesses. Add all that together and the total taxes paid rises to the 60% level, or roughly triple what the top 1% pay !
The Super Rich See Their Federal Taxes Drop Dramatically