Andrea Faye Ayres-Deets

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Hi, I’m a writer. I am also a lover of Science Fiction, cats, and awkward situations. Read some of my articles below or follow me on twitter.

How the Mega-Rich Avoid Paying Taxes


The International Consortium of Investigative Journalists (ICIJ) has released their findings of 2.5 million files worth of data from offshore acounts. Information from over 120,000 bank accounts details what many of us already know: the mega-rich and political-elite don’t play by the same rules. The report, “Secrecy for Sale”, was produced by a team of 86 journalists from 46 countries and it is an uncompromising look at how far individuals and governments will go to hide their money.

The information contained in the files is over 160 times larger than the leak of U.S. State Department documents from WikiLeaks in 2010. The wealth of knowledge contained in these documents is far too large to contain in one article, but here are some of the main takeaways.

The Amount of Wealth in Offshore Accounts is the Size of U.S. and Japanese Economies Combined.

It’s estimated that individuals have $21-32 trillion dollars in private wealth invested in offshore accounts. Billionaires aren’t the only individuals hiding their money. The files obtained by the 38 media organizations indicate that offshore accounts are held by a wide variety of people including doctors, lawyers, and Wall Street investors. Individuals with wealth looking to hide their money are usually able to get help from their personal banks.

Banks setup companies under a variety of guises in offshore centers, these secretly held companies are then used by the bank to assist customers in hiding their money. When banks provide this service, it gives individuals an easier method of obtaining offshore accounts. The report explains how Credit Suisse setup unprecedented levels of security to maintain the privacy of its consumers, “a company so anonymous that police and regulators would be met with a blank wall if they tried to discover the owner’s identities.”

It’s not just Swiss Bank players who are providing this type of service for its customers. According to The Economist, the major U.S. accounting firms of Deloitte, Ernst & Young, KPMG and PwC also provide offshore accounting products to its consumers.

Average People Are Screwed 

If you don’t have millions of dollars to invest in yachts or mansions, chances are you don’t possess the ability to hide your money the way the mega-rich do. Individuals with a large amount of wealth are able to take advantage of tax breaks and loopholes by investing their money into things like priceless pieces of art. They use intermediaries and a variety of other techniques to remain anonymous. The wealthy just don’t play by the same rules. James R. Mellon, one of the individuals profiled in the report, is able to name third parties as directors of his accounts. By doing so, he limits his direct involvement with his offshore investments. Intermediaries like tax advisors, corporate service providers, and financial institutions all help to facilitate the flow of capital to offshore locations.

Above: Image from The Economist detailing offshore wealth

Offshore Accounts Offer a Safe-Haven for Criminal Activity

Some of the largest offshore accounting firms like Singapore-based Portcullis TrustNet and British Virgin Island-based Commonwealth Trust Limited, fail to verify the people they are opening up accounts for. The report also indicates that the two firms regularly and freely violate anti-money-laundering laws. TrustNet setup offshore accounts for renowned Wall Street criminal Raj Rajartnam and Paul Bilzerian. Rajartnam is currently serving a prison sentence for his part in this largest insider trading scandal in U.S. history.

The families of government and political officials in Russia, Canada, Pakistan, the Philippines, Thailand, Mongolia, Azerbaijan and many countries, openly and indiscriminately make use of offshore accounts. Individuals with ties to dictators and the Iranian government are also able to circumvent international blacklists by using offshore accounts.

Companies Are Made-Up

Twenty-eight people are named as the directors for 21,500 companies. The UK based paper The Guardian reports that these companies are usually held anonymously in the BVI. In a substantive piece on offshore accounts published by The Economist in 2013, they discovered that there are 60 tax-havens that house two million paper companies.

Above: How tax havens cater to corporations and the mega-rich, from The Economist

Lax Regulatory Laws Enable the Proliferation of Offshore Accounts 

Individuals are mistaken if they believe that governments regulatory rules ban offshore accounting. Lax regulatory laws allow offshore financing to flourish. It is vital that individuals understand that offshore accounts are not excluded to places like the Cayman Islands. The U.S. State of Delaware is home to more than 6,500 paper companies. Other states like Nevada and Wyoming have also been accused of being tax-havens.

The Bahamas for example, does not tax income on offshore company profits and is home to over 250 licensed banks. Liberia is a great location to stash money because it’s been rated No. 3 in bank secrecy by the Tax Justice Network and allows you to register your yacht for more than 40 years. The Cook Islands are part of the territory of New Zealand, there, it is considered to be a criminal offense to breach company confidentiality. The Cook Island’s do not recognize court orders from foreign countries. Obviously, one of the most desirous places to stash your wad of cash is the Cayman Island, which boasts more money on hand than all of the banks in New York combined.

Global Economic Stability and The Future of Tax-Havens

Part of the Greek economic collapse was due to the heavy use of tax-havens by its citizens. Offshore accounts also increase the ability of individuals to partake in real estate speculation like the kind currently happening in Britain. Lax regulatory laws elsewhere create tension between countries attempting to crackdown on offshore account abuse. The information contained in the ICIJ’s four databases details individuals account data from 170 countries. To say that the desire to avoid paying taxes is widespread is the understatement of the century. Tax-evasion is so rampant that attempting to combat it offers an entirely different set of problems. The use of proxies and other technology has made it even more difficult to uncover who owns what.

Why isn’t it easy to crackdown on tax-havens and tax-dodgers? Because the international quality to offshore accounts enables people to exploit the lax regulation. The Organization for Economic Co-operation and Development (OECD) has repeatedly called for crackdowns on offshore tax-havens. OECD has requested that countries update their tax rules to compete with the digital age. The report by the OECD asked that countries apply current treaties to digital goods and services and crackdown on preferential regimes. The problem with addressing tax-evasion is that the current approach is too incremental which allows for companies and individuals to easily adjust for any small changes to regulation.

 

Above: One example of the vast network involved in offshore accounts from ICIJ.

Summary:

Internally, countries must alter their tax laws to ensure more consistent reporting of all aspects of a companies or individuals profits and accounts. Externally, countries must work together to combat and bring to justice individuals and corporations engaging in tax-evasion.

Seriously, do yourself a favor and check out this amazing interactive guide to how people and companies hide their money.

Boston Marathon Bombing: Why Do We Ignore Bombings Elsewhere?


As news of the Boston Marathon explosions broke most, if not all, of our media coverage was disrupted as they broadcast live developments. As news trickled in and a clearer picture was available we were able to call it what it is, a bombing. Three people have lost their lives and over 150 people were injured, many seriously. We mourn this loss of life. This morning, I read of another bombing. Thirty-three people killed, 160 wounded in a series of morning explosions that went off in numerous cities. This too happened on April 15, but there was significantly limited coverage of this story. Why? Because these bombings happened in Iraq.

The blasts went off simultaneously in Baghdad, Fallujah, Tikrit, Samarra and Hilla. All the bombs went off in the early morning rush hour, as the perpetrators sought to inflict the most damage. A resident of Kirkuk screams, “What have those innocent people done to deserve this?”

Like Boston, no group or individual has claimed responsibility for the attack on Monday. Why hadn’t I heard of this story, of these people who were experiencing such a similar tragedy? I can only speak for how I personally have viewed the news, from the comfort of my living room here in Chicago. Iraq and Afghanistan seem so far away, a world of endless bombings seems so far removed from my reality. Somehow, I’ve been able to hear about bombings in Iraq or elsewhere and then go about my life, easily navigating through my daily routine with little additional thought to those killed over 6,000 miles away. Shame on me.

But yesterday, I couldn’t tear myself away from the news. I sat rooted to my seat, compelling myself to read everything I could about the story. Trying to find connections, trying to understand what, who, why this happened. The dazed expressions that flooded my computer screen seemed all too familiar. They are the same faces we’ve seen hundreds of times before. It’s the haunted expression caused by utter devastation, as minds falter and emotions fail, in the moments before we understand what has happened.

When we speak of the Boston Marathon, we will call it a tragedy. When we speak about the bombings in Iraq, we tend to avoid such language. Surely the death of 33 people is a tragedy no matter where it happens? People will point out to me that people die every day in tragic events, that the news can’t possibly devote the same amount of time to them all. That’s true, but I’m not asking for equal news time. It’s not about keeping a score card for determining whose tragedy is worse or to determine which horrific act of violence is more befitting of more news coverage. If that were the case, surely the continued slaughter of civilians in Syria would be worth more than a passing mention.

The bombing in Boston will bring us closer together for a few days—maybe longer—as national tragedies tend to do. We will be reminded that we are, each of us, Americans and that we aren’t all that different. We are clearly struck personally by the events in Boston because they are so much closer to us in proximity, because we can see ourselves reflected in the people we see on the news. But, I must force myself to ask why must I only be allowed to feel a tragedy as an American? I must feel just as sad, mourn the loss of life just as much for those people in Iraq.

Intolerance, violence, and hatred is perpetuated by the differences we create. How many degrees of separation can I put in between myself and everyone else? If I remove myself far enough from someone, do they cease to matter as much, or at all? As we mourn the loss of life in Boston and the terrible carnage that only intolerance and hatred can breed, we must too mourn the loss of life that is caused by hatred and intolerance everywhere. Every time it happens, if I do not feel a significant sense of loss or sadness, what does that actually end up saying about me—about all of us? I don’t know. I would hate to think that it meant I was becoming used to seeing this carnage—used to seeing the horrific look on faces just because they didn’t resemble my own.

The Boston Marathon bombing brings us closer to the reality that so many experience every single day. Now is the time to reject violence everywhere. Now is the time to reject intolerance everywhere. We are all finite beings. We must see that the death of an eight-year-old little boy is a tragedy in Iraq, in America—anywhere.

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Is this too idealist for the way the real world works? I don’t know. Does that matter? Does that mean we shouldn’t at least try to better understand one another? Isn’t that what people who commit acts of violence prey upon? Our continued willingness to view one another with skepticism because they might look, think, act differently? Well, I reject that notion, and so should you because we can do more. We can certainly do better than this.

Rape Culture For Dummies

This is for those that victim blame, make excuses, or deny the existence of rape culture. This is for the Men’s Right Activists (MRAs) that believe rape culture is a myth perpetrated by a feminist agenda.

Walking down the parkway with my best friend in our small neighborhood was about the only past-time that a six-year old kid had in this subdivision. We walked over the wood-slat bridge, as we had done a hundred times before together, careful not to get splinters in our hands from the railing. As we approached the end of the bridge two neighborhood boys blocked our path.

They were the same age as me. The neighborhood had already branded them problem children — The kind of children whose parents could be heard yelling, or even worse in my neighborhood, a child with only one parent. It is a similar story to thousands that have been told before: a small town, with no secrets, where everyone kept their doors unlocked, even open during the summer times.

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U.N.: What does the U.S. Has In Common With Iran, Sudan, and Somalia


Rarely does the United States find itself in the company of the countries of Iran, Sudan, and Somalia in matters involving human rights, except apparently when it comes to women’s rights.

The Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) was first passed in 1979, and its adoption set forth international standards for the promotion and protection of women’s rights. It also puts in place mechanisms to increase access to these rights, and establishes the need for countries to dismantle and hold accountable individuals, governments, or organizations that seek to deprive women of them. Some187 countries have ratified this treaty, and the United States counts itself among only six that have failed to do so.

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Does America Have an Unadmitted Rape Culture Problem?

In December, millions of Americans expressed outrage over the brutal gang rape and murder of a 23-year-old woman in India. American journalists bristled over the number of Indian lawmakers who themselves, face charges of rape. Articles rightfully, criticized India’s government and rape culture. As this story unfolded so too did another.

The New York Times wrote a piece on a 16-year-old girl in Ohio who was allegedly raped and urinated on by multiple individuals while unconscious at a party back in August of 2012. Since the article was published on December 16th, much has happened. A subgroup of Anonymous —known as KnightSec, worked with the blog Localleaks to disseminate a 12-minute long video of a Steubenville High School baseball player discussing the girl and her assault. KnightSec continues to release information regarding involved parties.

On January 3rd, a California appeals court ruled that the case involving Julio Morales raping a sleeping woman, would have to be retried due to an archaic 1872 law. The law essentially states that the woman had not been raped because she was unmarried and therefore was not protected from rape by imposters.

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Roe v. Wade 40th Anniversary: The State of Women’s Rights

January 24 marks the 40th anniversary of the Supreme Court’s landmark Roe v. Wade decision. In 1973 the court ruled that the Due Process Clause of the Fourteenth Amendment protects Americans’ right to privacy, including the right to end a pregnancy.

Currently, a majority of Americans believe abortion should be legal, but only under certain circumstances, such as cases of rape or incest, or if the mother’s health is at risk.

Abortion played an important role in shaping the 2012 election, where the ill-conceived comments by two Republican candidates cost them election. Shortly thereafter, we heard of the story of Savita Halappanavar in Ireland, who died suffering a miscarriage, despite repeated pleas to doctors for an abortion. Picked up by mainstream media outlets, the story highlighted the issue of abortion rights in other countries.

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