News Releases

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FOR IMMEDIATE RELEASE
February 26, 2014

njacobs@nullthefactcoalition.org
Contact: Nick Jacobs
+1 (202) 841-1466

Camp Tax Plan: A Disappointment to Those Looking for Real Reform Statement from FACT Coalition Director Nicole Tichon

Following the release today by House Ways & Means Committee Chairman Representative Dave Camp (R-MI) of a plan to overhaul the U.S. tax code, the FACT (Financial Accountability and Corporate Transparency) Coalition released the following statement from its director, Nicole Tichon:

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“Mr. Camp still erroneously clings to the notion that U.S. multinational corporations are taxed higher than anywhere else in the world.  As the report released today by the Citizens for Tax Justice makes abundantly clear, this is simply not the case.  In fact, many have paid no tax at all or have paid higher taxes to foreign governments than here at home.  This robs the treasury of much-needed resources and supports a system the pushes jobs offshore.This proposal starts with a false premise, and largely lets  multinational corporations off the hook.”

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
February 13, 2014

njacobs@nullthefactcoalition.org
Contact: Nick Jacobs
+1 (202) 841-1466

OECD Releases of Model for the Automatic Exchange of Financial Information Statement from FACT Coalition Director Nicole Tichon

Following today’s announcement by the OECD (Organization for Economic Co-operation and Development) of the release of their “Standard for Automatic Exchange of Financial Account Information: Common Reporting Standard,” the FACT (Financial Accountability and Corporate Transparency) Coalition released the following statement from its Director, Nicole Tichon:

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“Today’s announcement is a major step forward in the fight against tax evasion – a fight that is clearly global in nature with significant local implications for governments. The fact that the model agreement draws fromU.S. standards for governments to exchange financial information demonstrates the efficacy of the Foreign Account Tax Compliance Act (FATCA).And now efforts to repeal FATCA have been pushed on their heels, and the U.S. will need to move forward with the rest of the world.  Our resolve to combat tax evasion and improve financial transparency is strengthened by this global commitment.” The OECD report is available here: http://www.oecd.org/tax/oecd-delivers-new-single-global-standard-on-automatic-exchange-of-information.htm.

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
January 16, 2014

njacobs@nullthefactcoalition.org
+1 (202) 841-1466
Contact: Nick Jacobs

FACT and Partners on Baucus International Tax Proposal: “Proposal Falls Short” Says Formal Letter to Committee Cites Three Critical Flaws

The FACT (Financial Accountability and Corporate Transparency) Coalition along with partners from small business, faith, labor and public interest groups submitted a formal response to Chairman Max Baucus (D-MT) and the Senate Finance Committee, calling his proposed changes to the international tax system as falling short “…in three critical ways and leaves room for the offshoring of jobs and profits to continue.”

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For many years, corporations have exploited provisions of the U.S. tax code, to move profits on paper to tax havens and ultimately pay little, if anything, in U.S. corporate tax. All told, American companies have close to $2 trillion in profits offshore.  Academic experts estimate that the U.S. loses $90 billion in revenue annually from tax haven abuse by large multinational corporations. The plan reflects a constant drumbeat from corporations that rates need to drop in order for them to compete. “When many large multinational corporations are already paying little or no tax, it’s tough to make the argument that they deserve a rate reduction,” said Nicole Tichon, director of the FACT Coalition.  “The plan does address some of the worst abuses and gamesmanship, but without knowing the immediate and longer-term discounted tax rates on earnings, there’s a danger of rewarding bad actors.” “It’s hard to support a short term fix when we need a long term fix,” said Eric LeCompte, Executive Director of Jubilee USA Network, a faith-based antipoverty organization. “In order to protect the poor, we believe we need to permanently end corporate offshore tax avoidance.” FACT small business partners note the lack of revenue. “Sen. Baucus’ proposal on offshore tax havens doesn’t raise enough revenue, which restricts our ability to invest in our economy,” said David Levine, CEO of the American Sustainable Business Council.  “Our scientific, national polling shows that more than 90 percent of all small business owners see overseas tax loopholes as a problem.” The coalition also supports separate and ongoing efforts to end offshore tax abuses, some of which were included in Mr. Baucus’ discussion draft. “Congress doesn’t need to wait for comprehensive tax reform to put an end to loopholes like ‘check-the-box.’ Senator Levin’s Stop Tax Haven Abuse Act (S.1533) closes the most egregious offshore tax loopholes, saving taxpayers over $220 billion over the next decade. Lawmakers looking to cut the deficit should start there,” said Dan Smith, U.S. PIRG Tax and Budget Advocate. Click here to read a letter signed by 538 state and national organizations from 40 states in support of the Stop Tax Haven Abuse Act.

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
December 11, 2013

Contact: Nick Jacobs
+1 (202) 841-1466
njacobs@nullthefactcoalition.org

Statement on Murray-Ryan Budget Plan by FACT Coalition Executive Director Nicole Tichon

Nicole Tichon, Executive Director of the FACT (Financial Accountability and Corporate Transparency) Coalition release the following statement on the budget plan released by senator Patty Murray (D-WA) and Representative Paul Ryan (R-WI):

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The Murray-Ryan plan represents a missed opportunity to raise revenue through good tax policy. It fails to close the egregious corporate tax loopholes that Senator Murray addressed in a Washington Post op-ed just a few weeks ago.  Such a deal could have closed the loopholes that multinational corporations use to game the system in order to pay little if no corporate income tax at all.  While many ordinary Americans are continuing to be asked to sacrifice, we’re letting the most profitable companies off the hook yet again by maintaining a flawed system. And when it comes to making budget choices both now and in future debates –the American people will be watching to see whose side Congress is really on.

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
December 5, 2013

njacobs@nullthefactcoalition.org
+1 (202) 841-1466
Contact: Nick Jacobs

FACT Applauds Legislation To Close Most Abused Corporate Tax Loopholes

The FACT (Financial Accountability and Corporate Transparency) Coalition today praised Representative Lloyd Doggett (D-TX) and Representative Rosa DeLauro (D-CT) for the introduction of the Sequester Delay and Stop Tax Haven Abuse Act.  Among other things, this legislation would close or tighten tax loopholes that have been used by some of the most profitable multinational corporations – Apple, Hewlett-Packard, Microsoft and Nike – to avoid paying their fair share of taxes.  Some tax loopholes allow corporations to use complex accounting schemes to make it appear that profits earned in the United States are actually generated in other countries, often a tax haven with little or no tax on profits.

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As an added benefit, closing these loopholes will also generate over $220 billion over the next ten years, which can be used to delay  some of the automatic budget cuts that Congress put in place through sequestration. The FACT coalition contends that the use of these loopholes by corporations to move jobs and profits offshore drains the U.S. of much-needed resources and economic activity.   As it stands, Congress is struggling to make up the required revenue needed to  maintain our national security and provide for a functioning government. FACT Executive Director Nicole Tichon comments, “This bill provides for common-sense reforms that would help restore fairness and transparency within the tax code as well as  vital revenue to the country.” “Jubilee USA applauds Congressman Doggett and Congresswoman DeLauro for introducing this important legislation that will benefit millions around the world and in the US,” said Eric LeCompte, Executive Director of Jubilee USA Network, a faith-based antipoverty organization. “Nations across the globe are impacted by multinational corporations not paying their fair share of taxes. Now is the time to stop these practices to protect the most vulnerable.” “When corporations use tax havens to dodge the taxes they owe, the rest of us pick up the tab, either through higher taxes, cuts to important programs, or a bigger deficit,” commented Dan Smith, Tax and Budget Advocate for U.S. Public Interest Research Group (U.S. PIRG).  “Some budget decisions are tough, but closing the offshore tax loopholes that let large companies shift their tax burden to the rest of us is a no-brainer. This legislation is a twofer – it would make our tax code fairer while replacing arbitrary spending cuts that throw the baby out with the bathwater.” “When large corporations use offshore tax havens to avoid their tax responsibility, small businesses that pay our fair share face an economic disadvantage,” said Jim Houser, Executive Committee member of the Main Street Alliance and co-owner of Hawthorne Auto Clinic, a small business in Portland, Oregon.  “More than three quarters of small business owners support closing offshore tax loopholes, according to a poll this year by the Main Street Alliance.  Small businesses need Congress to make economy-boosting investments that fuel consumer demand at home, not protect offshore tax dodgers.” A letter from a number of organizations in support of the bill can be found here.

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
November 19, 2013

Contact: Nick Jacobs
+1 (202) 841-1466
njacobs@nullthefactcoalition.org

Baucus Tax Reform Proposal Takes Aim at Offshore Loopholes, Leaves Big Questions Unanswered

While citing progress in terms of closing offshore tax loopholes, the Financial Accountability and Corporate Transparency (FACT) coalition believes that the tax reform discussion draft introduced by Senate Finance Committee Chairman Max Baucus falls short when it comes to permanently ending incentives for America’s biggest multinational corporations to shift jobs and profits offshore.  The coalition found the proposal to lack some critical details.

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The three areas of concern raised are:

  1. It does not sufficiently end incentives for multinational corporations to shift profits offshore, which costs taxpayers an estimated $90 billion per year and creates an uneven playing field for small and domestic businesses.
  2. It is revenue neutral, earmarking all the revenue raised from closing loopholes for reductions in the corporate tax rate. With federal revenue from corporations hovering at multigenerational lows, precisely because of the offshore profit shifting incentives, this is unacceptable.
  3. It should hold corporations accountable to report their profits and revenues in a consistent manner to government, shareholders and the public.

The full letter to Chairman Baucus and the Senate Finance Committee can be found here. For many years, corporations have exploited provisions of the U.S. tax code, to move profits on paper to tax havens and ultimately pay little, if anything, in U.S. corporate tax. All told, American companies have close to $2 trillion in profits offshore. Academic experts estimate that the U.S. loses $90 billion in revenue annually from tax haven abuse by large multinational corporations. “The current system is not sustainable as it drains much-needed jobs and revenues from our country,” said FACT Coalition Director Nicole Tichon. “Reforming the way the U.S. taxes our multinational corporations should require more, not less, from the companies that benefit from all of the advantages of doing business here. This is an opportunity that Congress and the American people cannot afford to miss.”

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
November 6, 2013

njacobs@nullthefactcoalition.org
+1 (202) 841-1466
Contact: Nick Jacobs

2013 Financial Secrecy Index Released U.S. Still a Top Offender

Despite the damage that shadow banking and financial secrecy has caused to global markets and local budgets today’s release by the Tax Justice Network (TJN) of their 2013 Financial Secrecy Index ranking the world’s nations by their financial concealment shows a global financial network still remains hidden in the shadows.  The FACT (Financial Accountability and Corporate Transparency) Coalition sees many opportunities for the U.S. to not only take action on this issue, but also in the process bring in new revenue to alleviate some of the constraints imposed under sequestration.

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The United States is ranked sixth in TJN’s 2013 Financial Secrecy Index, a slight improvement from 2011, when they were ranked fifth.  In TJN’s FSI rankings, the higher the number a country is ranked, the more secretive it is.  And while giving credit for taking some important steps, such as the Foreign Account Tax Compliance Act (FACTA), the US is nonetheless described as a country that, “…has played a pioneering role in devising ways to defend itself against foreign tax havens, but has failed to address its own role in attracting illicit financial flows and supporting tax evasion.” Members of the FACT coalition have been vigorously supporting efforts to build on the progress of FATCA, and make sure that corporations that benefit from doing businesses in the US are paying their taxes as well, and calling for tax cooperation and reporting by countries on economic activities of multinational corporations. “The global race to the bottom on corporate regulations as well as tax rates has led to massive revenue loss in both developed and developing countries,” stated FACT Director Nicole Tichon.  “Closing loopholes that enable our most profitable companies to legally game the system should be the top priority during upcoming budget debates.” TJN also cited the lax company formation regulations and requirements in the United States, which are left up to the individual states.  A report accompanying the release about the US notes that almost two million corporations and limited liability companies (LLCs) are formed in U.S. states each year, without the states asking for the identity of the owners.  Many of these companies are then used as conduits for money laundering, fraud, tax evasion, and other nefarious deeds. The US could address corporate secrecy by taking immediate action on legislation currently before Congress that would put an end to the secrecy of phantom firms. This year legislation has been introduced in the Senate, S.1465, and a companion bill newly introduced in the House, H.R. 3331.  While these pieces of legislation do not call for public registries, FACT members see these efforts as a critical first step for the U.S. to finally begin collecting information about people who ultimately own or control companies and making it available to law enforcement. Read letters of support for corporate transparency and for U.S. legislation from law enforcement, small businesses, investors and civil society here. “Each year close to two million corporations and limited liability companies (LLCs) are formed in the United States, making this country accountable for over 22 percent of the global market for offshore financial activity. The fact that such an influential, powerhouse of a country should rank so poorly on this year’s FSI is shameful. The United States owes to its own citizens who are feeling the crunch of severe budget cuts, as well as to the rest of the world, a basic level of transparency and accountability in our financial system,” said Porter McConnell, manager of the Financial Transparency Coalition. “The U.S. should be showing leadership on the issues of financial and corporate secrecy. We cannot expect cooperation from other countries while letting the shadows to remain here,” Tichon further observed.

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.

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FOR IMMEDIATE RELEASE
October 31, 2013

njacobs@nullthefactcoalition.org
+1 (202) 841-1466
Contact: Nick Jacobs

FACT Coalition to U.S. Government: Time to End Phantom Firms UK Announces Public Registry of Corporate Ownership

Today’s commitment from the Prime Minister of the United Kingdom to make a registry of the actual owners of corporations publicly available represents significant progress toward cracking down on anonymous companies polluting the globe.  Because the United States is a prime destination for setting up anonymous companies that are used to facilitate crime and move dirty money, members of the FACT (Financial Accountability and Corporate Transparency) Coalition urge the U.S. to follow through on its G8 commitment to collect information about the ultimate owners of companies.  The coalition encourages the U.S. to join the UK by pledging to make this information available to the public.

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More companies are formed in the U.S. each year than in the rest of the world combined, and many states allow the creation of anonymous companies or “phantom firms.”  Typically, less information is provided to incorporate these entities than to obtain a driver’s license. In fact, many U.S. states rank among the easiest jurisdictions in the world to form a company without revealing the identity of who ultimately owns or controls it.

Nicole Tichon, Director of the FACT coalition, stated, “Our government is allowing corrupt officials and tax evaders to hide their ill-gotten gains and to remain in the shadows.  We hope that the UK commitment will help build momentum and the political will to shine a light on anonymous shell companies.  The U.S. made a commitment to the G8 to work on resolving this issue – but now it’s time to put words into action.  I challenge anyone to defend the purpose of secret corporations and what they facilitate.”

Phantom firms are a great way to hide money and other assets. Criminals have disguised their identities behind anonymous American companies to evade taxes, facilitate massive fraud, traffic arms and humans, and launder the proceeds of corruption. A registry of the true owners and controllers of companies would make it much harder for criminals to hide behind American shell companies to perpetrate schemes to defraud investors and other innocent Americans or to steal millions of dollars from Medicare. It would also provide important benefits to small businesses.

Eric LeCompte, Executive Director of Jubilee USA Network, a faith-based antipoverty organization, stated: “We applaud the UK government for setting up a plan to promote corporate transparency. As billions of dollars are lost for social services in developed and developing nations, ending this opaque behavior is a critical step. Building off of momentum from the G8 declaration, we hope the Administration will implement similar plans to address these issues.”

For years, Congress has had the chance to pass bipartisan legislation to put an end to the secrecy of phantom firms. This year legislation has been introduced in the Senate, S.1465, and a companion bill newly introduced in the House, H.R. 3331.  While these pieces of legislation do not call for public registries, FACT members see these efforts as a critical first step for the U.S. to finally begin collecting information about people who ultimately own or control companies and making it available to law enforcement.  And should corporate transparency legislation become law, FACT seeks to continue to strengthen them and push for their availability to the public.

Read letters of support for corporate transparency and for U.S. legislation from law enforcement, small businesses, investors and civil society here.

“It is simply not fair for these bad actors to hide their identities while other legitimate business owners proudly place their names in the papers establishing their companies, and stand squarely behind who they are and what they do,” said David Levine, CEO for the American Sustainable Business Council.

“Phantom firms have become the favorite tool for big election spenders wanting to hide their identity. In 2012, 17% of business contributions to Super PACs came from phony shell companies set up to flood the election with secret campaign cash,” added Jaimie Woo, U.S. Public Interest Research Group tax and budget associate.  “Shell companies have also been used to scam consumers with fake credit cards, and bilk Medicare for millions. The U.S. should follow the UK’s lead so that the public and law enforcement isn’t left in the dark.”

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Founded in 2011, the Financial Accountability and Corporate Transparency (FACT) Coalition unites civil society representatives from small business, labor, government watchdog, faith-based, human rights, anti-corruption, public-interest, and international development organizations. We seek an honest and fair corporate tax code, greater transparency in corporate ownership and operations, and commonsense policies to combat the facilitation of money laundering and other criminal activity by the legitimate financial system.