Super-rich hoarding $32 trillion cash in secret, tax-free havens

By Catholic Online (NEWS CONSORTIUM)
7/23/2012
Catholic Online (www.catholic.org)

Between $21 and $32 trillion in cash being kept hidden

The super-rich and their families are estimated to have as much as $32 trillion of hidden financial assets in offshore tax havens. This clandestinely hidden cash represents up to $280 billion in lost income tax revenues.

Those who wish to avoid paying taxes on their earnings frequently convert their cash into gold and secret them away in Swiss bank accounts.

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LOS ANGELES, CA (Catholic Online) - According to research published this weekend, it's estimated the extent of global private financial wealth held in offshore accounts. These funds do not include non-financial assets such as real estate, gold, yachts and racehorses.

The study was conducted by the pressure group Tax Justice Network, which campaigns against tax havens, by James Henry, former chief economist at consultants McKinsey & Co.

"What's shocking is that some of the world's biggest banks are up to their eyeballs in helping their clients evade taxes and shift their wealth offshore," John Christensen, of the Tax Justice Network says.

This hidden dosh is as significant as the U.S. and Japanese GDP combined. Roughly 10 million people worldwide have offshore accounts, with 100,000 people owning half of those secreted assets.

Christensen adds that he was shocked by "the sheer scale of the figures.

"What's shocking is that some of the world's biggest banks are up to their eyeballs in helping their clients evade taxes and shift their wealth offshore," Christensen said.

"We're talking about very big, well-known brands - HSBC, Citigroup, Bank of America, UBS, Credit Suisse - some of the world's biggest banks are involved...and they do it knowing fully well that their clients, more often than not, are evading and avoiding taxes."

Many of the practices used to secret the funds away are plainly illegal, Christensen says.

Using data from the World Bank, International Monetary Fund, United Nations and central banks, the report also highlights the impact on the balance sheets of 139 developing countries of money held in tax havens by private elites, putting wealth beyond the reach of local tax authorities.

The study estimated that since the Seventies, the richest citizens of these 139 countries had amassed $7.3 to $9.3 trillion of "unrecorded offshore wealth" by 2010.

� 2012, Catholic Online. Distributed by NEWS CONSORTIUM.

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Keywords: Secret havens, tax-free areas, illegal cash shoring

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1 - 10 of 14 Comments

John
7 months ago
The reason for placing one's monies offshore, especially in the USA, is to protect your assets from injury attorneys. People here intentionally cause auto acidents, then file lawsuits for millions of dollars. Insurance fraud costs billions. The other reason is fear. Just like someone hiding their money in a buried jar or stuffed matress. Their jar is just offshore. That's why they call it a "haven" Greed and envy are the worst demons when laws are written. Often taxes are increased not to provide a better service but merely to replenish the funds siphoned off elsewhere thru corruption. All corrupt societies/cities eventually crumble and die, like a drug crazed addict. What is wrong with trying to safely protect yours. Wealthy individuals are THE most concerned about preserving or making societies safe.
Judy Claar
9 months ago
Pat: Yes. You have our ears. What socialistic teachings of Jesus? Peace to you....
Judy Claar
9 months ago
I see by the interesting posts this article was a good one! Mike O., I think I like your explanation the best. About the very rich, that is their worry and concern. I just know that I was Blessed w/o it. Illegal or not? Like someone said, they have been doing it for years, (hiding their monies) and if they didn't, the government probably would have made a law to have it seized by now. I guess I am of the IRS=Caesar generation. After all, our forefathers did not start us off with the IRS! Blessings...
JoAnn
9 months ago
Pat: Could you please be more specific. What do you mean by Jesus' socialistic teachings? What socialistic teachings? God bless.
YARMI
9 months ago
No Taxation without Representation! Equality and opportunities are beautiful God given gifts. Articles such as this one are very informative however, there is always two sides to every story. People tend to be very attached to their money and their assets for many reasons. Some are born rich, some have work hard for it. Some of the poor work very hard for their money too, and some have two even three jobs, just to make ends meet. While some rich or poor collect Social Security, Unemployment benefits, Housing and programs for those that are needy and some greedy and some balancing their financial situation. It saddens me to see, people who get gov. help and make more money than others that show up to work and put in the best of their talents, and work for someone who would love to maximize profits and minimize loss, and always have it as a win, win.There is no such thing as a win, win sometimes you loose and that's alright. We don't live in a perfect world, but people who want to become extremely rich over the backs and time of the people cannot be right.
Pat
10 months ago
How much do you commenters hate Jesus for his socialist teachings?
Terri K
10 months ago
I don't much care for the tone if this piece either. Perhaps if it explained how/why this practice is illegal, I might agree to the use of the word "hoarding". Our society is increasingly expectant of government hand-outs, which happen to be funded by the wealthy. Communism is a bad idea. It kills productivity and innovation.
Rob
10 months ago
I don't disagree with any of the sentiments here. But then we need to start speaking the truth. We first need to stop all this trickle down nonsense talk. And they need to be taxed to the extent we are. I can't park money over seas to gain a tax advantage, they shouldn't be able to either. Since so much money is now being put back into the economy, time to stop providing all the tax shelters etc. Our problem on the both the left and the right is that we like the punch lines taxes tell, but rarely concern ourselves with the details.

To the extent the wealth is actually creating jobs, I say don't tax it all. But to the extent it's not, quit providing ways to shelter it. The only thing our Congress does when that happens is provides protections for wealth and the average American cannot avail themselves us. I see nothing in the constitution that mandates that our congress safeguard the wealth of those already wealthy. This is not class warfare. Honestly, this is just noting who the victor already is. To have a war is to have some chance at winning. With our current batch of politicians the wealthy have nothing to fear.
Ta-152H
10 months ago
Bob' "Rich people are wealthy " I did't know that! Thanks.By the way if the rich provide jobs at 32 trillion I figure we should be at 0% unemployment what gives ?
Eugene Leady
10 months ago
The comments that have been left contain some misleading generalizations. I attempt to seek the whole truth.
Now some of the comments state the super rich got that way by working hard. Therefore they are justified to hide their money from the greedy government who wants to tax it. How do we know that is true?
We know there are many cases of stock insider trading, that net the illegal traders many hundreds of millions of dollars. Just read the news in detail. Since these insider traders worked hard breaking the securities laws, would it ok for them to hide their wealth from the greedy gov who wants to tax these "hard" workers?
Remember President Marcos of the Phillipines who hid most of the money, hundreds of millions the US gave the country for rent of the air force and Navy bases.? Would his family be considered hard workers who should be able hide their accounts off shore?

More recently there are stories of how many billions the US has spent rebuilding Iraq and Afganistan that are unaccounted for. Should those who stole much of these money be considered hard workers also?
Do people remember what has gone on? There are many cases of corruption in our country and in the world.
Recently a large US bank paid a large fine for money laudering, that is accepting hundreds of million from Mexican casas de cambio- ie drug money. Is there any doubt that the hard workering drug cartels hid their money off shore so that the governments cannot trace the cash flow, or impede their drug operations? Should the gov be able to investigate them?
There are of course many wealthy people who built up companies, invented new technologies etc,etc who are entitled to their wealth.
But don't say that all the people who are hiding these trillion of dollars are just nice hard working people.
Most people I know who are hard workers their entire life are not able to amass much money. If the rich who hide wealth off shore are justified in not paying taxes because they are "hard workers", why shouldn't the average person, who without question is a hard worker ,be justified in not paying taxes?
The wealthy, like the rest of us use the services that the government supports, roads highways, airports, the police,the military that protects their assets etc.etc etc. Wealthy people need to pay their fair share. We all need to pay our taxes even if we are not fond of the current administration.

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