By Brian LeBlanc, May 2, 2014
There has been a lot of talk in recent years regarding the extent of China’s investment in the United States. Most of this has been centered on China’s admittedly large holdings of U.S. debt, but the fear has spilled over to other forms of investment as well. A 2012 report filed by the US-China Economic and Security Review Commission, an entity created by Congress in 2000, went as far as recommending that the Committee on Foreign Investment in the US be amended to add a required litmus test for Chinese investment, specifically. This test would make it mandatory to analyze the “net economic benefit” of all proposed Chinese investment in the United States before it is approved.
Being fair, a lot of this has to do with national security, with the rational that Chinese acquisitions of telecommunication companies (for example) might pose a threat to the “cyber and physical infrastructure services critical to maintaining the national defense, continuity of government, economic prosperity, and quality of life in the United States.” How much of this is legitimate I’m not sure of.
Still, does China own an outsized portion of US assets compared to the rest of the world? The short answer is no, not even close.
Follows Prime Minister’s Move to Create Public Registry of Beneficial Ownership for All UK Companies
Pressure Continues to Rise on U.S. Government to Follow Suit
WASHINGTON, DC – Global Financial Integrity (GFI) lauded UK Prime Minister David Cameron today for urging all British Overseas Territories and Crown Dependencies in a letter today to crack down on the abuse of anonymous shell companies by creating public registries of meaningful beneficial ownership information. The letter follows recent moves by the UK Government, which is currently in the process of creating the world’s first such public registry to do the same.
Repeal of FATCA Would Cripple U.S. Crackdown on Tax Havens & Financial Secrecy, Cost the U.S. Taxpayer Billions
WASHINGTON, DC – Global Financial Integrity (GFI) urged the Republican National Committee (RNC) to reject a proposed resolution calling for the repeal of the Foreign Account Tax Compliance Act (FATCA)—the cornerstone of the U.S. effort to fight offshore tax evasion. The law, which was passed in 2010 as part of the Hiring Incentives to Restore Employment (HIRE) Act, requires foreign banks to report deposit information on their U.S. accountholders for U.S. tax compliance, as is required of domestic U.S. banks.
A Year after HSBC, Is the U.S. Doing Enough to Fight Money Laundering?
Writing in the current New York Review of Books, Jed S. Rakoff castigates the U.S. government for failing to prosecute any executives of financial institutions responsible for the recent, world-shaking financial crisis. As a judge on the U.S. District Court for the Southern District of New York, Rakoff has witnessed firsthand much of the legal denouement of the crisis, and his disappointment with the government’s inadequate response carries a great deal of weight. Rakoff questions the government’s reasoning in generally not even threatening criminal charges for executives, despite overwhelming evidence that knowledge and responsibility for the mortgage-backed asset bubble predicating the financial crisis rose to the highest levels in many banks.
Monday was International Anti-Corruption Day, an occasion for those who work to fight bribery, money laundering, and illicit capital flight to reflect on the past year and set goals for the next. We have many reasons to celebrate 2013, but also plenty of work still to do in 2014. At Global Financial Integrity, our research shows that nearly $1 trillion leaves developing countries each year (many times the amount such countries receive in official development assistance) through illicit financial outflows, a devastating loss of capital facilitated by a shadow financial system more than happy to accommodate corrupt assets. Gains in tax information exchange and other areas this year will surely help curtail some of this moving forward, but there are many more policy changes needed before this economic scourge can be effectively addressed.
WASHINGTON, DC – As the world commemorates International Anti-Corruption Day on Monday, December 9, 2013, Global Financial Integrity (GFI)—a Washington-based, non-profit research and advocacy organization—reviewed many of the most notable achievements, developments, and shortcomings in fighting corruption and illicit financial flows for 2013.
“2013 has proven to be a landmark year in terms of policy advancements to curtail corruption and illicit financial flows,” said GFI President Raymond Baker, a longtime authority on financial crime. “Years of hard work by policymakers, researchers, and advocates culminated in real, on-the-ground policy achievements that will directly impact the amount of money leaving developing countries. We saw a few setbacks, but overall the year was very encouraging.”
A Johns Hopkins professor’s efforts to develop an untraceable digital currency are dangerous
U.S. law enforcement officials have been shutting down giant illegal marketplaces that do business in “bitcoin” and are beginning to lay out plans to regulate such digital currencies — like we do any other kind of money — by requiring that money laundering controls be applied to the transactions.
The virtual bitcoin currency is not backed by any central bank or government and can be transferred “peer to peer” between any two people anywhere. It is created through a complex computer mining process that allows people to earn new bitcoins by solving certain mathematical problems.
New UK Public Registries to Become the Gold Standard to Combat Illicit Financial Flows
President Obama Ought Follow Cameron’s Leadership
WASHINGTON DC – Prime Minister David Cameron announced today that the United Kingdom plans to create a central public registry of corporate beneficial ownership information, and called on other countries to join the United Kingdom by establishing their own public registries.
Heather Lowe, Director of Government Affairs at Global Financial Integrity, praised the historic move, “David Cameron is proving to be the true global leader on tackling the kind of financial opacity that has stymied growth in developed and developing nations alike. Today’s announcement that the United Kingdom will not only be the first nation to collect information on who owns and controls the companies created in the UK, but that the information will be available to the public is truly groundbreaking.”
