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Wednesday, May 22, 2013

Online press unveils list of suspected tax evaders

An independent journalists' group in South Korea on Wednesday exposed a list of high-profile Korean businessmen and their families suspected of running slush funds in tax havens, in what could cause a huge social ripple amid a slew of ongoing probes into secretive money owned by the rich.

The Korea Center for Investigative Journalism (KCIJ), a non-profit organization set up by former journalists, disclosed three names of heads of family-owned conglomerates, known here as chaebol, who allegedly have stashed secretive money through a paper company account in the British Virgin Islands and the Cook Islands.

"We're first releasing the names of those that have considerable economic clout so that the disclosure will be in accord with the public interest," Kim Yong-jin, the KCIJ chief director, told reporters at a press briefing held in Seoul. 

The findings are based on a joint investigative journalism project by the KCIJ and the International Consortium of Investigative Journalists (ICIJ), in which the KCIJ has taken part since last month. 

According to its preliminary investigation, there are 245 Koreans who have set up a bogus company in the tax haven regions and are suspected of having at least one slush fund account. Some of them have fake financial accounts under false names to avoid being caught by the authorities. 

The three names released on Wednesday were Lee Soo-young, the owner of polysilicon-making giant OCI Co. and his wife; Lee Young-hak, the wife of former vice president of Korean Air Lines Co.; and relatives of the 25th-largest conglomerate Hyosung Group.

The research is based on an internal database consisting of information on 130,000 clients and over 122,000 paper companies obtained from two agencies that set up paper companies by proxy. 

The KCIJ said it will announce another list of tax evaders' names in the following press conference next Monday. (Yonhap News)

Apple's CEO faces U.S. Senate questions on taxes

The U.S. Senate sharply questioned the CEO of Apple Inc., the world's most valuable company, over allegations that its Irish subsidiaries help it avoid billions in taxes, and Tim Cook declared, “We pay all the taxes we owe _ every single dollar.”

The Senate Permanent Subcommittee on Investigations released a report Monday that held up Apple as an example of the legal tax avoidance made possible for companies by the U.S. tax code. It estimates that Apple avoided at least $3.5 billion in U.S. federal taxes in 2011 and $9 billion in 2012 by using its tax strategy and described a complex setup involving Irish subsidiaries.

Even if additional tens of billions from Apple began flowing into the U.S. Treasury, the money would barely put a dent in the $642 billion federal budget deficit. But Apple as a symbol resonates with politicians seeking to make the case that a powerful corporation shouldn't be excused from its fair share of taxes.

The subcommittee also has examined the tax strategies of Microsoft Corp., Hewlett-Packard Co. and other multinational companies, finding that they too have avoided billions in U.S. taxes by shifting profits offshore and exploiting weak, ambiguous sections of the tax code. 

The spotlight on Apple comes at a time of heated debate over whether and how to raise revenues to help reduce the high U.S. deficit. Many Democrats say the government is missing out on billions of dollars because companies are stashing profits abroad and avoiding taxes. Republicans want to cut the corporate tax rate of 35 percent and ease the tax burden on money that U.S. companies make abroad. They say the move would encourage companies to invest at home.

Cook reaffirmed Apple's position that given the current U.S. tax rate, it has no intention of bringing that cash back to the U.S. Like other companies, it has a responsibility to shareholders to pay as little as possible in taxes. Cook added that Apple is the nation's largest corporate taxpayer.

Thanks largely to the iPhone, Apple is also one of the world's most profitable companies. It earned $41.7 billion in calendar year 2012. It's neck and neck with Exxon Mobil Corp. as the world's most valuable company.

Apple's enormous profits mean that it has more cash stashed overseas than any other company: $102 billion.

Sen. Carl Levin, the panel's chairman, said Apple's use of loopholes in the U.S. tax code is unique among multinational corporations.

Apple uses five companies located in Ireland to carry out its tax strategy, according to the report. The companies are located at the same address and share members of their boards of directors. While all five companies were incorporated in Ireland, only two of them also have tax residency in that country. That means the other three aren't legally required to pay taxes in Ireland because they aren't managed or controlled in that country, in Apple's view.

The report says Apple capitalizes on a difference between U.S. and Irish rules regarding tax residency. In Ireland, a company must be managed and controlled in the country to be a tax resident. Under U.S. law, a company is a tax resident of the country in which it was established. Therefore, the Apple companies aren't tax residents of Ireland or the U.S., in Apple's view.

“Apple is exploiting an absurdity,” Levin said.

Cook argued that the Irish subsidiaries don't reduce the company's U.S. taxes. Rather, the company avoids paying the 35 percent federal tax rate on profits made overseas by not bringing those profits back to the U.S., a practice it shares with other multinationals.

The U.S. tax code contains provisions designed to force companies that sell their products overseas to pay U.S. taxes on the profits from those sales. But certain loopholes allow companies to legally bypass those provisions. The Irish subsidiaries are set up to take advantage of those loopholes, according to the committee's report.

Apple's stock fell $3.27, or less than one percent, to close at $439.66 in Tuesday's trading.

Levin also called Ireland a “tax haven,” an appellation Irish Prime Minister Enda Kenny rejected when speaking in parliament in Dublin on Tuesday. He also denied the assertion in the subcommittee's report that Apple had negotiated an Irish corporate tax rate of less than 2 percent. All companies pay the standard rate of 12.5 percent on profits from Irish operations, the prime minister said.

Ex-Seoul police chief summoned over attempt to cover-up spy agency scandal

Prosecutors summoned a former head of the Seoul police agency Tuesday for questioning over suspicions that he had hampered a police probe into the nation's spy agency's alleged attempt to influence public opinion ahead of last year's presidential election.

The summons came after a female detective, who led the police investigation, claimed that high-ranking police officers of the Seoul Metropolitan Police Agency (SMPA) had pressured her to treat the case lightly.

Kim Yong-pan, who headed the SMPA at the time, appeared for questioning at the Seoul Central District Prosecutors' Office in southern Seoul around 10:00 a.m., prosecutors said.

Police have been probing allegations that the National Intelligence Service (NIS) systemically and extensively meddled in the presidential election by using its agents to illegally post a slew of politically sensitive comments against the opposition candidate on the Internet to sway public opinion ahead of the December vote.

On April 18, Seoul's Suseo Police Station, which investigated the case for four months, announced that at least two NIS agents illegally intervened in domestic politics by posting political comments and replies on various Web sites ahead of the election.

But it cleared them of charges of violating the election law under which they could face heavier punishment.

Kwon Eun-hee, the lead investigator on the case at the time, claimed a day later that she could not fully look into the case due to immense pressure from her superiors.

On Monday, a team of 27 prosecutors and investigators raided the headquarters of SMPA in central Seoul, seizing computer hard drives and relevant documents to verify the claims.

The superiors pressed her team to drastically decrease the number of search words for analyzing one of the NIS officers'

computer hard drives, Kwon said.

Prosecutors have questioned Kwon and her bosses, including the former head of the Suseo Police Station, over her claims since early this month. (Yonhap News)

Monday, May 20, 2013

CNN report : UN Petitioned to Investigate Fraudulent South Korean Presidential Election


Last week South Korean civil rights group, "Fighters For Voters’ Rights (FFVR)" filed a petition to the United Nations requesting an investigation into the election fraud of the South Korean 2012 Presidential Election. They claim that last December's presidential election was fraudulent based on the fact that government agencies such as the National Intelligence Services (NIS) interfered in election campaigning and that ballot counting was manipulated by the National Election Commission (NEC).

Since last December’s election many South Koreans who believed that the government and the ruling party had played a foul game during the election have protested in the street, filed a lawsuit against the NEC, and published statements domestically and abroad. They have demanded a recount of ballots by hand and a thorough investigation into the intervention by the NIS in the election. They have claimed that the election result should be pronounced invalid if the election had been, in fact, fraudulent.

Although initially the NIS denied all charges against them more evidence revealed that they had actually interfered in domestic politics systematically on a large scale. The agents conducted illegal online election campaigning for the presidential election in order to bring victory to the ruling party. As recently as last week some documents surfaced with evidence showing a department head of the NIS ordering his staff to carry out a specific project to undermine the Mayor of Seoul because he had become popular for his ‘leftist’ policies to benefit people of the less-privileged class.

Jennifer Lee, one of the three leaders for FFVR, said in a recent interview with Kukmin TV that they had decided to plead to the UN because the politicians and the media in South Korea had been bluntly ignoring the demand of the people although it had become very clear, with sufficient evidence, that the election had been completely fraudulent. The group, FFVR, had spent numerous hours collecting huge amounts of data related to the election and the NIS’ intervention and going through them to verify their objectivity and truthfulness. Lee said that every single article on these issues had been looked over by the group. She told the interviewer from Kukmin TV that it had taken FFVR three whole months to prepare the data, to write the petition, and to have lawyers review the petition for its legality.

When asked if there were any successful examples of a petition to the UN Lee said that in the cases of Afghanistan and Iran the UN had sent investigation committees to each country for investigation into the fraudulent elections. They are hoping that the UN will also send an investigation committee to South Korea to investigate this matter.

They plead to the UN for the following:
To lay a provisional injunction upon the South Korean government against destroying the ballots (the ballots are scheduled to be destroyed immediately after June 19, 2013)
To investigate the NIS' intervention of the presidential election and to nullify the election if this turns out to be true
To conduct a recount even if the intervention of the NIS and any other illegal actions by the government and the ruling party are not grounded in truth
To investigate further into the known manipulation of the ballot counting by the NEC.
To investigate all incidents related to coercing handicapped voters to vote for Park and to recommend any revision of our current law to prevent this from happening again
To assist their country with a new and fair presidential election

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1 hour ago
Explore it For the True Democracy in Korea!!!!
1 hour ago
They plead to the UN for the following:
To lay a provisional injunction upon the South Korean government against destroying the ballots (the ballots are scheduled to be destroyed immediately after June 19, 2013)
To investigate the NIS' intervention of the presidential election and to nullify the election if this turns out to be true
To conduct a recount even if the intervention of the NIS...
Read more …
3 hours ago
Koreans never elected Park Keun Hae as a President.
3 hours ago
I love FFVR !!^^♥♥♥  Fighting!!!   

2012.12.19    S.Korea presidential election invalid!!!

4 hours ago
Why this doesn't make the top headline is an utter mystery.