Perfektion protegiert Pädophilie

Perfection sponsors pedophilia.

In its thousand-year-old quest for perfection, the Vatican under St. Pope John Paul II was staffed with high officials who were supporters of a group called the Legion of Christ and of its charismatic founder, Marcial Maciel (born 1920 in Mexico, died 2008 in U.S.A.), a man who sexually abused children. German newspaper articles said Marcial Maciel raped children, using his Legionary students and priests as “lustknaben” [lust boys], weekly but possibly daily since the 1940’s. He used to summon young people to his bed at night to massage his stomachaches; after ruining their lives he reportedly told them the pope had given him permission to assuage his ills in this manner to enable him to continue his marvellous good works. He switched to women in the 1970’s and was known to have fathered several children. When he was 56, he used a false identity to seduce a 19-year-old girl, founding a family with her, then founding a second family ten years later. “According to his women, of his four children he didn’t sexually abuse only one of them,” said the F.A.Z. [“Nur eines seiner vier Kinder missbrauchte er nach Angaben seiner Frauen nicht.”: a bit convoluted].

Marcial Maciel’s qualification as a priest and his education have been called into question, because he was kicked out of several Catholic education institutions as a teenager in Mexico despite the support of several bishop uncles before being ordained by one of those uncles.

Mr. Maciel apparently had a serious opiate addiction since the 1940’s, and used to send confidants hundreds of miles with faked prescriptions to obtain medications for him, and get nuns to administer shots and tablets to him.

The high point of Marcial Maciel Degollado’s power was in 1994, said the F.A.Z.

The Legion of Christ—which still exists and e.g. has a location in Germany, in Bavaria—has been described, in its conservative attitudes and rigorous discipline, as a bit similar to the Opus Dei and Pius Brothers groups. Founded in 1941, the organization also used anti-communism as a way to surf to power during the Cold War. It’s said to have been close to the Franco dictatorship in Spain. The Legion successfully recruited wealthy aristocrats as supporters throughout the 20th century, apparently in countries like Spain, Austria and Germany. Süddeutsche Zeitung said the Italian l’Espresso newspaper and Rupert Murdoch’s Wall Street Journal reported that the Legionaries have had huge financial resources, possibly due to Marcial Maciel’s close involvement with Carlos Slim, possibly the richest man in the world, and the German branch’s recruitment of the former “C.E.O. of the United Nations’ Refugee Agency and chair of the German Fundraising Association” [Deutscher Fundraisingverband, it’s not clear who that is or for whom they raise funds]. The Legionaries have an organization for laypeople called Regnum Christi that’s been said to have or have had 50,000 members.

Supporters of Marcial Maciel inside the Vatican included:

  • Cardinal Angelo Sodano at the State Secretariat, who has been accused of leading a “coverup faction” that tried to hide priests’ pedophilia at very high levels. Cardinal Sodano may have had good connections to the Chilean dictator Augusto Pinochet because “as a nuncio he introduced Maciel into Chilean society during the time of the Pinochet military dictatorship,” according to the F.A.Z.
  • Pope John Paul II’s secretary, Stanislaw Dziwisz, who became the cardinal-archbishop of Krakow.

Italian journalist Gianluigi Nuzzi published a book in 2012 about the discoveries he made in materials revealed by the Vatileaks Vatican whistleblowing. In Süddeutsche Zeitung, Mr. Nuzzi said that Marcial Maciel’s secretary, Pater Alfredo Moreno, met with Pope Benedict’s secretary in 2011 and reported that he had destroyed documents containing evidence of Mr. Maciel’s crimes. According to the Vatileaks information, at the 2011 meeting Pater Moreno said he was refused an audience by John Paul II’s Vatican when he tried to report this in 2003. Other German-language newspaper articles show there were decades of notifications to the Vatican about this man’s crimes. The Swiss Tagesanzeiger said a victim was refused an audience with John Paul II to discuss Mr. Maciel’s abuse in 1983. In the late 1970’s a victim sent the Vatican a letter describing what had happened to him and some of his brothers but there was no response, said the Frankfurter Rundschau. In 1956 the Vatican investigated accusations against Mr. Maciel (which they had now also received from the U.S. and Spain, in addition to Mexico); that report too has disappeared in the Vatican archives, “as have all other letters and reports containing information on Maciel’s practices,” said the F.A.Z., adding that since the 1950’s Mr. Maciel’s strategy of favorably influencing key cardinals with money and gifts created an impenetrable armor around him.

The first newspaper report about this was apparently published in the U.S.A.’s Hartford Courant in 1997 by journalists Jason Berry and Gerald Renner. Then there were reports in Mexican media. All were heavily squashed: “Libel lawsuits, advertizing boycotts, freezing out journalists who dared to take up the topic, getting personalities from public life to defend Maciel—nothing was not tried,” said the F.A.Z. Before dying mysteriously, a former Legionary well-known in Mexico asked the priest Alberto Athié to ensure that justice was served, and in 1998 Fr. Athié filed a lawsuit in Rome with eight former Legionaries against Mr. Maciel for abusing the sacrament of confession by hearing his victims’ confession after a shared night, issuing the victims absolution with an order to maintain silence. But the head of the department responsible for hearing Fr. Athié’s lawsuit, the Congregation of the Faith’s Cardinal Josef Ratzinger (later Pope Benedict XVI), decided not to allow the 1998 proceedings despite the fact that his department at the Vatican was not the one in which previous complaints against Mr. Maciel had always disappeared and despite the fact that Cardinal Ratzinger was not known to have been one of the cardinals accepting envelopes full of money from Mr. Maciel’s network. In 1999, the archbishop of Mexico City stripped Fr. Athié of all his church functions.

(Peah FECKED shown   pro tej jeert   pay dough feel EE.)

Sondergerichte vs. Schwurgerichte

Special courts vs. jury courts (lit. “oath courts” because jurors are sworn in).

Apparently Turkey has been under international criticism for years for using special courts [Sondergerichte] to try serious political crimes. Now Prime Minister Recep Tayyip Erdoğan’s government has announced they will be using normal Schwurgerichte [jury trials] for these crimes as well. However, the announcement comes after Mr. Erdoğan’s government made other, unhelpful changes to Turkey’s judicial system: Human Rights Watch asked Turkish President Abdullah Gül not to sign a new law passed in the second week of this month that reduced the autonomy of Turkey’s High Council of Judges and Prosecutors or H.S.Y.K., saying the law exclusively serves to increase the government’s control over that council.

The Sondergerichte/Schwurgerichte legislation package passed in the third week of this month did contain some mild improvements. In addition to eliminating special courts for trials of serious political crimes it also reduced the maximum time you can be held in Turkish prison while they’re investigating you for a crime, from 7.5 to 5 years. In future, arrest warrants and house razzias can only be executed on the basis of “concrete evidence.” Supposedly this legislation made tapping phones more difficult.

However, in the first week of this very busy February 2014, after having quickly replaced the head of Turkey’s telecommunications oversight authority, Telekomünikasyon İletişim Başkanlığı, Mr. Erdoğan passed Turkey’s now notorious new Internet surveillance and censorship law that expanded the agency’s powers to collect data about people’s internet surfing and to block web pages.

In the second week of this month, fistfighting is said to have broken out in the Turkish parliament during debate over Mr. Erdoğan’s bill to get more control over the national board of prosecutors and judges, H.S.Y.K. They passed the legislation anyway. One M.P. had to go to hospital for a broken nose.

In the third week of this very busy February, the government put forward draft legislation expanding the power of the country’s National Intelligence Organization (Milli İstihbarat Teşkilatı or M.İ.T.). It would define prison sentences of up to 12 years as punishment for publishing secret M.İ.T. documents, for example. Update on 17 Apr 2014: The parliament passed this. Prosecutors are no longer allowed to investigate M.İ.T. agents for crimes if the agents say they were on government business. M.İ.T. is to have access to all government data, to be able to listen without a court order to phone calls inside and outside Turkey, and to be given all businesses’ data about their customers if they request it.

The brief time span in which three terrible laws were created—the drastic Internet law on 06 Feb, the kneecapping of judges and prosecutors on 15 Feb, and now this latest proposal on 21 Feb announced as democratic reforms in response to outside criticism of the Ergenekon trials—cloaked the scope of these anti-democratic changes to the rest of the world.

Turkish protesters’ anger over all the bills and the trend they indicate was easily misinterpreted by outsiders as a response to the first, internet law. Attempts to mitigate or react to one of the new terrible laws interfered with attempts to prevent the next one. The winter Olympics in Russia and the historic events in Ukraine also diverted attention from Turkish politics.

Update on 11 Apr 2014: Turkey’s Constitutional Court found the reforms unconstitutional that gave Mr. Erdoğan’s justice minister sweeping powers over the H.S.Y.K. board that appoints and fires prosecutors and judges. The F.A.Z.’s article only said the court overturned parts of this reform, however.

The prime minister’s son’s foundation received donations of >72 million euros from outside Turkey and ~10 million euros from inside Turkey. Recep Tayyip Erdoğan’s son and daughter Bilal Erdoğan and Esra Erdoğan are members of the Türgev foundation’s management board [Vorstand]. The organization is supposed to support Turkish youth and education; the opposition C.H.P. party said it’s a corruption center where businesspeople launder bribes they have to pay to get public contracts.

(ZONE dah gr-r-r ICHH tah   vair seuss   SHVOOR gr-r-r ICHH tah.)

Doch drohnenfähige Handydaten!

Cell phone data are droneable after all!

Last summer Germany’s foreign intelligence service, the Bundesnachrichtendienst or BND, admitted they’d been sharing phone data with U.S. intelligence agencies for years but said it was okay because cell phone data couldn’t be used to locate people and something about the N.S.A. promised not to use German-supplied phone data to kill anyone. Regarding the first claim, whistleblowers from U.S. drone programs have now explained to reporters how phone data were used for targeting assassinations around the world.

One whistleblower, describing countermeasures persons of interest have taken to keep using phones while evading geolocation and how these countermeasures can deliberately or accidentally increase the drone strikes’ already terrible civilian casualties, called the U.S. drone programs “little more than death by unreliable metadata.”

Details from the article and online discussions included:
“Pods” on U.S. drones (and presumably on urban utility poles because this might be what police have been quietly installing in U.S. cities using Dept. of Homeland Security funds) can spoof cell phones into providing data and can vacuum information off wifi networks from altitudes of four miles. Telecommunications standards in some “countries of interest” make it possible for many users there to share data the U.S. uses to identify targets’ cell phones. Wireless “party lines” quietly shared by pools of low-income civilians increase the chances that countries indulging in drone assassinations will accidentally kill party line participants and their families and neighbors, or be tricked into killing their enemies’ enemies, such as by firing missiles at wedding parties or legislatures after someone hides a cheap phone there.

(Daw chh   drone nen fey igga   HEN dee dotten.)

Kernkraft-Weissblendung

“Nuclear Power Whiteout,” a non-native speaker’s inadequate translation of the title of the bestselling Japanese thriller
Genpatsu Whiteout. It’s a story about a fictional terrorist attack on a nuclear power plant in Japan. The pseudonymous author seemed so well-informed that there was speculation about the area of government in which he or she might have been employed.

Philip Brasor wrote, “Though it sounds like a conventional thriller, the novel’s overarching theme is the government’s determination to resume the nation’s nuclear power network after the Fukushima accident, a mission it carries out so heedlessly that it neglects to enact safety standards that would mitigate the effects of such an attack.”

Apparently the fictional novel also mentions an entrenched system of power companies’ adding 10% over the market value to purchases made for the electricity industry in that country, with some of the extra money being distributed among networks of politicians and their affiliates. And possible post-tsunami attempts in response to the engineering disasters at Fukushima Daiichi to pass legislation that supposedly increased safety, transparency and competition but doesn’t really. Bribe costs ultimately get paid by electricity consumers in their utility bills; reforms that don’t fix the corruption problem might make Japanese voters more amenable to restarting dangerously engineered nuclear power plants if they’re told it will supposedly reduce electricity prices.

(CAIRN croft   VICE blend oong.)

“Daß die Pressefreiheit in Großbritannien nirgendwo rechtlich verbrieft ist, rächt sich jetzt.”

“The fact that freedom of the press is not guaranteed by law anywhere in Great Britain is now taking its revenge,” was a German reporter’s comment on a hearing held to determine whether the Guardian’s reporting on Snowden trove documents had put Britons in danger.

ARD tagesschau.de correspondent Annette Dittert went on to say, “In no other democratic country would such a campaign against a well-respected newspaper even be conceivable, and especially not a campaign ordered by that country’s government.” She said at the hearing Mr. Rusbridger “broke a lance” for freedom of the press, using good arguments and pretending to be unaffected by the enormous political pressure. Süddeutsche.de called him a stiller Stern, a quiet star.

(Doss   dee   PRESS ah fry height   inn   gross brit ON ee enn   near gen dvoh   wrecked lichh   fair BRIEFED   issed,   r-r-r-echh t   zichh   yetsst.)

Detekteien

Private detective agencies. A Spiegel.de article dated 2008 said this was an unregulated and unsupervised but burgeoning security industry in Germany, sometimes employing former Stasi cooperators. The authors estimated there were ~1500 private detective companies in Germany in 2008 and about a dozen key world players, including the New York-based Kroll and London-based Control Risks. Many of these companies earned game-changing amounts of money in Iraq after the second U.S. invasion. They could be hired via law firms protected by attorney-client privilege, and subcontract jobs to other firms, obscuring cause-and-effect. A new C.E.O. of Control Risks said they were also hiring journalists to spy on other journalists.

A Detektei called Network Deutschland was “involved” in the German rail company Deutsche Bahn’s data privacy scandal when it was caught spying on its employees in 2009, leading to the retirement of C.E.O. Hartmut Mehdorn. Network Deutschland was also involved in the former-monopoly phone company Deutsche Telekom’s so-called “Telekom data scandal,” which is confusing but included T-mobile’s years of archiving communications data of members of its own supervisory boards, such as the head of the German trade union association Deutsche Gewerkschaftsbund. T-mobile was especially interested in any phone interactions with journalists. Deutsche Telekom was also accused of using private detectives to spy on journalists in other ways.

The 2013 Snowden revelations might provide some insight into the means private detective companies could have used to access these communications and banking data. Online ads and tech articles seem to be indicating that powerful N.S.A.-type tools are now trickling down into the regular economy, being sold to smaller and smaller entities.

N.B.: How early did the notoriously technophilic and well-funded U.S. National Football League know about some of these capabilities?

An English-language Spiegel.de article dated 2008 speculated about the separate huge data hoards controlled by the national rail (Deutsche Bahn), national airline (Lufthansa), post office (Deutsche Post) and phone company (Deutsche Telekom), all companies found to have made questionable investigations and hired detective agencies. The magazine couldn’t show that they had combined their data in 2008 though; they also only connected up e.g. that Deutsche Bahn and Deutsche Telekom hired the same detective agency but Lufthansa and (Telekom?) investigated the same journalist (Tasso Enzweiler from Financial Times Deutschland, which folded in 2012). The Spiegel article wanted to but could not show that the four big corporations also investigated each other, but it reminded us they were well positioned to investigate each other and anyone else in Germany. The Spiegel.de article didn’t want to feed conspiracy theorists but hoped the German government wasn’t asking these companies for access to their sensitive customer data. All four used to be state-owned and the German government still held large stakes in Deutsche Bahn and Deutsche Telekom.

(Day tect EYE en.)

Beibehaltung

Retention.

April 2013: After it became known the chair of the supervisory board [Aufsichtsrat] of Germany’s richest and most successful soccer team, Bayern Munich, was under investigation for voluntarily reporting himself [Selbstanzeige] as having an insufficiently reported and taxed ~500 million euros in a Swiss bank account, there seem to remain some loose ends in his origin story for where the half billion came from*. Yet on 06 May 2013 Bayern Munich’s supervisory board voted not to accept Uli Hoeneß’s resignation as its head. Members of the supervisory board who supported Mr. Hoeneß at this meeting included: Herbert Hainer, C.E.O. of Adidas. Rupert Stadler, C.E.O. of Audi. Timotheus Höttges, chief of Finances and Controlling at top Bayern sponsor Deutsche Telekom. Martin Winterkorn, C.E.O. of Volkswagen. Edmund Stoiber (C.S.U.), former candidate for German chancellor in the C.D.U./C.S.U. party.

10 May 2013: Mr. Hoeneß is suing the responsible prosecutor’s office for being the source of the press’s discovery of the investigation into the mysterious half billion euros, in April 2013.

30 Jul 2013: Uli Hoeneß has been charged with alleged tax evasion. The Economic Crimes Chamber [Wirtschaftsstrafkammer] of the second Munich Landgericht [Münchener Landgericht II] must now decide whether it will allow the trial to proceed and whether to open the main trial. The decision is expected in late September 2013.

04 Aug 2013: The president of the German Soccer Association [Deutscher Fussballbund e.V., D.F.B.], Wolfgang Niersbach, declared his support for Uli Hoeneß.

07 Aug 2013: Stern.de report that an anonymous informant told the second state prosecutors office in Munich [Münchener Staatsanwaltschaft II] that Mr. Hoeneß’s untaxed millions are not limited to one account at the Swiss Vontobel bank (said by prosecutors to have contained 500 million Swiss francs but said by Mr. Hoeneß in April 2013 never to have exceeded around 15 to 20 million euros, tops). Stern.de reported the informant said Mr. Hoeneß’s Vontobel account had balances consistently [“durchgehend“] exceeding 500 million Swiss francs in years before 2008 and also supplied information about stock dealings and transactions involving numbered accounts at three other Swiss banks: Crédit Suisse, Julius Bär and the Zürcher Kantonalbank.

The whistleblower said Deutsche Telekom stock with which Mr. Hoeneß participated in so-called dividend stripping was also involved.

04 Nov 2013: Mr. Hoeneß will have to “answer before a court” after all, starting ~10 Mar 2014. Landgericht Munich II’s “Economic Chamber” [Wirtschaftskammer] announced it will allow trial of charges against him of tax evasion and providing inaccurate answers. His Selbstanzeige earlier this year “contained errors.”

Frank Bräutigam, ARD tagesschau.de’s excellent legal correspondent, said the trial will evaluate the correctness of the Selbstanzeige (timeliness, completeness and accuracy). If the court determines that the Selbstanzeige was not properly executed, next it must decide how much money was improperly handled and what penalties could be imposed.

The Bayern Munich football club’s supervisory board reconfirmed that they want to retain Mr. Hoeneß as president of the club.

14 Mar 2014: Uli Hoeneß’s trial for 3.5 million euros of tax evasion was this week. In the two weeks before the trial started on Monday, he apparently gave prosecutors 50,000, some said 70,000, pages of Vontobel bank account statements previously withheld. On Monday he surprised reporters by announcing he’d actually not paid 18 million euros tax, but this was the ultimate number, no more revelations. On Tuesday, an auditor testified that the amount was actually 27 million. He was found guilty of 28.5 million euros in tax evasion and sentenced to 3.5 years, which will probably be in an open prison. On Friday, he said he would not appeal. The prosecutors may still decide to appeal. Uli Hoeneß resigned as president of the FC Bayern Munich soccer club and chair of FC Bayern Munich Inc.’s supervisory board.

Mr. Hoeneß’s salary tended to be about 10 million euros per year. The Vontobel account never had more than 150 million euros in it at one time.

(BY beh HALT oong.)

* Mr. Hoeneß said he netted 500 million euros between 2000 and 2012 by compulsively playing the stock market starting with a 10-million-euro combination gift/loan in 2000 from a now-deceased friend, a former C.E.O. of Adidas.

Festnahmeersuchen

Arrest request.

Edward Snowden cannot apply for German asylum before entering German territory. Members of the government could then issue him an Aufenthaltserlaubnis but it might not prevent his deportation to the U.S.A., because that country prudently filed a Festnahmeersuchen [“(intergovernmental) arrest request”] with Germany last summer. There are deportation agreements [Auslieferungsabkommen] between the E.U., Germany and the U.S.; to prevent deportation under those agreements an “obstacle reason” or estoppel [Hinderungsgrund] must be cited, “for example, that Germany considers the deed he is accused of to be a political crime,” said Frank Bräutigam, ARD law reporter, who added that the decision or “last word” lies with the Justice Ministry, of course in coordination with the entire cabinet. The Justice Ministry would have to make a clear statement that “Germany will not deport him.” Heribert Prantl wrote in Süddeutsche.de that the Interior Ministry is responsible for issuing Mr. Snowden’s Aufenthaltserlaubnis, but the courts and Justice Ministry are responsible for the more important question of deportation.

Bundestag member Petra Pau (Leftists; she appeared to do a great job in the parliamentary committee investigating the investigations of the neonazi serial killers) said on Nov. 1 that she could not recommend that Mr. Snowden travel to Germany under current circumstances, “because at the moment I see no one who can guarantee his safety.” Süddeutsche.de’s Heribert Prantl reminded his readers of the story of reformer Jan Hus in 1414 C.E., who received a letter of safe conduct, “sicheres Geleit,” from the Holy Roman Emperor yet was burned at the stake as a heretic.

ARD tagesschau.de showed residency-relevant paragraphs from what appeared to be a 2008 version of a residency law [Aufenthaltsgesetz, AufenthG]:

“565. Gesetz über den Aufenthalt, die Erwerbstätigkeit und die Integration von Ausländern im Bundesgebiet (Aufenthaltsgesetz, AufenthG). In der Fassung der Bekanntmachung vom 25 Feb 2008 (BGBl. I S. 162). […]” 565. Law on residency, employment and integration of foreigners in Federal German territory (Aufenthaltsgesetz, AufenthG). In the version promulgated 25 Feb 2008 (Federal Gazette I p. 162). […]
“Abschnitt 5. Auftenthalt aus völkerrechtlichen, humanitären oder politischen Gründen. Section 5. Residence due to reasons of international law [Völkerrecht, “peoples law”], humanitarian reasons or political reasons.
“§22 Aufnahme aus dem Ausland. (1) Einem Ausländer kann für die Aufnahme aus dem Ausland aus völkerrechtlichen oder dringenden humanitären Gründen eine Aufenthaltserlaubnis erteilt werden. (2) Eine Aufenthaltserlaubnis ist zu erteilen, wenn das Bundesministerium des Innern oder die von ihm bestimmte Stelle zur Wahrung politischer Interessen der Bundesrepublik Deutschland die Aufnahme erklärt hat. (3) Im Falle des Satzes 2 berechtigt die Aufenthaltserlaubnis zur Ausübung einer Erwerbstätigkeit.” §22 Admittance or acceptance from outside Germany. (1) An Aufenthaltserlaubnis can be issued to a foreigner for acceptance into Germany from abroad for international law reasons or urgent humanitarian reasons. (2) An Aufenthaltserlaubnis is to be issued when the Interior Ministry or the office they nominate has declared acceptance to protect political interests of the Federal Republic of Germany [emphasis of ARD tagesschau.de and ZDF heute journal]. (3) In the case of (2), the Aufenthaltserlaubnis shall include a work permit.

Another possibly fruitful area or “construction site” ARD tagesschau.de mentioned is the possibility that the federal prosecutor [Bundesanwalt] in Karlsruhe might use the Criminal Code [Strafgesetzbuch] to investigate certain individuals for spying on Germany.

“§99. Geheimdienstliche Agententätigkeit. §99. Secret service agent activity.
“(1) Wer (1) Whosoever
“1. für den Geheimdienst einer fremden Macht eine geheimdienstliche Tätigkeit gegen die Bundesrepublik Deutschland ausübt, die auf die Mitteilung oder Lieferung von Tatsachen, Gegenständen oder Erkenntnissen gerichtet ist, oder 1. performs a secret service activity against the Federal Republic of Germany for the intelligence service of a foreign power, said activity being directed toward the communication or delivery of facts, objects or knowledge, or
“2. gegenüber dem Geheimdienst einer fremden Macht oder einem seiner Mittelsmänner sich zu einer solchen Tätigkeit bereit erklärt, 2. declares himself or herself willing to perform such an activity to the intelligence service of a foreign power or one of their middlemen
“wird mit Freiheitsstrafe bis zu fünf Jahren oder mit Geldstrafe bestraft, wenn die Tat nicht in § 94 oder § 96 Abs. 1, in § 97a oder in § 97b in Verbindung mit § 94 oder § 96 Abs. 1 mit Strafe bedroht ist. will be punished with imprisonment [Freiheitsstrafe, “freedom punishment”] of up to five years or with a fine if the action is not punishable in accordance with §94 or §96 section 1, in accordance with §97a or in accordance with §97b in conjunction with §94 or §96 section 1.
“(2) In besonders schweren Fällen ist die Strafe Freiheitsstrafe von einem Jahr bis zu zehn Jahren. Ein besonders schwerer Fall liegt in der Regel vor, wenn der Täter Tatsachen, Gegenstände oder Erkenntnisse, die von einer amtlichen Stelle oder auf deren Veranlassung geheimgehalten werden, mitteilt oder liefert und wenn er […]” (2) In especially severe cases, the punishment shall be imprisonment from one year to up to ten years. An especially severe case is usually a case where the offender communicated or delivered facts, objects or knowledge kept secret by an official office or upon their order, or when the offender […]

und so weiter und so fort.

Tagesschau.de reported, “The federal prosecutor in Karlsruhe recently reconfirmed to ARD that relevant German authorities had been requested to send in their knowledge/ideas/facts [Erkenntnisse] regarding the bugging of the chancellor. No official preliminary investigative proceedings have been opened yet. Only after that happened would it be possible for Mr. Snowden to testify as a witness in criminal proceedings.”

(FEST nom eh eah ZOO chh en.)

Der schlimmste Feind im ganzen Land, das ist und bleibt der Denunziant.

“The worst enemy/biggest rascal in the whole damn country is and remains: a snitch.” Handy mnemonic reminding Germans not to squeal on their neighbors, even when the stress of dense living conditions can get overwhelming. Left-leaning German students will repeat this to you as a meme joke that’s crept firmly into their consciousness, while they diligently study education, journalism or history, enjoy detective shows on television and meet up in meatspace for ferocious protracted information-sharing discussions in the interest of bettering democracy. Perhaps it’s now understood that snitching on your fellow citizens will murder Anne Frank but finding out what governments and other large actors are up to and talking about it might save lives.

Bruce Sterling: “What’s a historian but a fancy kind of snitch?” is a deeply unsettling offhand remark.

Australian radio’s charming Phillip Adams asked a Mossad expert a chiming question in a recent discussion of the information asymmetry enabled by drones and other surveillance: “Are you allowed to spill all the beans?” Mr. Adams was bean facetious.

Now that I’m olderly, I can think of more specific examples of situations in which professional information-sharers might *not* share the relevant useful context they know:

Schoolteachers: the topic of censorship in schools is ancient, but people will still surprise you. My grandfather used to show kids how to carefully mix up explosives within the safety rules of his high school chemistry class because he knew a certain book was available in the local library.

Historians: the majority would probably object strongly to showing people who make fake reference books how to make more convincing fake reference books. Though there could be tempting exceptions. Pacifist historians for example might not mind hearing that widely available gunsmithing research had been used to glut an overfunded, underinformed collectors’ market fetishizing blunderbusses like baseball cards (but pacifist historians would care very much if they heard the shoddy cast iron was shattering and injuring people). Historians are disturbed by the introduction of fake evidence, a crime against future generations that might someday be correctable, and absolutely infuriated by destruction of genuine evidence, a crime against future generations that can never be made right. It is so easy to accidentally destroy genuine evidence; it is casually shown over and over in archeology adventure films.

Introducing something that is beautiful, but not real, but not falsely presented as something other than it is (or encouraging destruction of genuine evidence!) almost seems okay. A gorgeous art book that riffs on designs and pictures from old reference books without being disguised as one could be a beautiful gift to the world. With proper source citation.

Journalists: probably must deal with the problem of when to withhold information most often, being confronted by these dilemmas accidentally because it goes with the job and on purpose, by interested parties familiar with the job. Journalism’s evolving ethics, rules and procedures are thus very valuable and interesting.

Priests: have the chance to learn a lot about contexts and reasons in local communities but might be highly susceptible to targeted “for the better good” arguments not to supply the most honest why’s and how’s, especially when the unusual levers within their particular religion are applied.

Scientists: probably have the clearest rules about information sharing, while handling some of the most useful information. Publish everything that seems reliably true according to defined test methods, unless the government swoops in. Archive non-seized published information and its underlying data so they can be found again, forever.

Librarians: seem to stand back and let people discover their own answers, though some jewels of librarianship can and will provide wonderful succinct context when asked. That can go the other way too—there were stories about history students in Germany returning to hometown libraries and discovering systematic long-term local obfuscation of local people’s colorful Nazi pasts. As the decades passed, the cover-ups necessarily got more and more complicated, the information in the town got more out of synch with the information widely known outside the town, and the aging perpetrators in the institutions were more likely to err and get caught.

Universities: one of the most fun and possibly most expensive hobbies you can pursue in the U.S.A. (A more expensive hobby might be something else + a university education, such as raising a child.) Professors and, these days, untenured adjunct instructors give highly efficient shortcut answers that tesseract you to the most useful synopses, unless they’re lying. Figure out how to study more than the inadequate standard four years and you might get an education. Figure out how to return to college from time to time and you might keep it.

After I studied history in a country that wasn’t either Cold War superpower, it seemed to me that one of many things the U.S.A. had in common with the Soviet Union but not with other countries was that the U.S. allowed propagandistic tendencies in important national history professors. This only became apparent after exposure to its absence. Once “allowed” it seems hard to eradicate—I noticed the U.S. tendency in the late 1990’s and it’s still going on in 2013. Presumably, sponsors’ and university administrators’ ethical barriers to installing such “chairs” must be deliberately reconstructed and haven’t been; also it’s hard to muster the data and arguments to effectively criticize a history professor. The latter was true of nearly all professors in Germany, professional experts who enjoyed a certain god-like status that was susceptible to abuse, but might especially pertain to history professors in the U.S.A.

Novelists: Fiction writers lie, wrote Margaret Atwood, and they use lying as a devious form of truth-telling. Along those lines, Terry Pratchett’s Y.A. books’ relatively direct overgeneralizations about people and institutions seem to have stood the test of time well, providing some rare explanations twenty years ago that appear not inaccurate today, two decades and half a world away.

Older relatives, like me now: will explain a lot, especially via wandering anecdotes, like this blog post; but they won’t tell you why and how if the reason is that someone in your family screwed up. When they’re feeling bad because they think they screwed up themselves, they often won’t talk about that either.

Government watchdogs, auditors, rapporteurs, monitors, inspectors general; departmental offices of internal affairs, ethics, professional responsibility: in addition to systemic inbuilt ways these inspectors may accidentally or deliberately fail to find and report, or be prevented by inspectees from finding and reporting, important cases of waste, fraud & abuse, how their reports are packaged for the press can also hide their key discoveries. The surrounding context we would like to know more about is so difficult to communicate that perhaps it’s no wonder we would like to know more about it. During the Reagan administration, it made little economic sense that the president’s stories about a “welfare queen”—which turned out to be a fairy tale—found more resonance than the real e.g. $500 hammers, nuts and toilet seats the Pentagon was caught buying at the same time. Which was the bigger economic threat? Yet one fairy tale was easier to remember than two overpriced hardware items.

Bureaucracies that don’t include functioning, safe systems for reporting and fixing in-house errors are what create a WikiLeaks.

WikiLeaks and other disseminators and investigators of huge data troves: are flummoxed by too much data, where vast volumes can hide relevant answers, especially after misinformation was introduced. But software has now been developed and distributed that helps map these infinitely complex connections. Insignificance and the ephemeral nature of human memory will no longer shield nonhackers.

(Dare   SHLIMM sta   FIE nd   im   GONTS en   LOND,   doss   ISST   oont   BLY bt   dare   den OONTS ee aunt.)

Selbstständig ausweichen, eigenständig ausweichen

Independently avoid, autonomously avoid.

The airspace regulation problem cited for why the European Aviation Safety Agency and the U.S.A.’s Federal Aviation Administration refused to allow the at-one-time largest remotely operated drone, the U.S./German Euro Hawk, to fly over U.S. and European airspace was the agencies’ requirement for “sense-and-avoid” technology ensuring drones avoid collisions with other aircraft as well as a human pilot would do. Wouldn’t guaranteed collision avoidance be impossible without first implementing Isaac Asimov-like laws of robotics to the extent that the drone would “want” to survive and protect just as much as a human pilot? Even Asimov’s laws of robotics might not fix drones’ vulnerability to remote hacking that could deliberately crash them, armed or unarmed. Supplementary to the air traffic rules preventing collisions with other aircraft, what regulations might help keep hacked or broken drones from colliding with objects on the ground or in orbit?

The situation may be evolving and toward deregulation of anticollision requirements in the U.S.A.: an FAA.gov press release dated 26 Jul 2013 announced a “giant leap” and “milestone” had been achieved because the Federal Aviation Administration was for the first time “type-certifying” unmanned aircraft for flight: the Scan Eagle X200 from Insitu and the PUMA from AeroVironment, each weighing ca. 55 pounds with ~3-meter wingspans. “A falcon flying blind,” that cannot “see” without its ground stations, the Euro Hawk was said to weigh 15 metric tons and be 40 meters wide. Its delivery flight was supposed to be at 20,000 meters altitude.

Germany’s Euro Hawk surveillance drone program was canceled in May 2013—and the sudden course correction may only have been caused by a concerned whistleblower who informed Bundestag member Hans-Peter Bartels (S.P.D.) in whose district they were going to base the crash-prone drones. Since then, Defense Minister Thomas de Maizière (C.D.U.) was caught lying about when he knew the Euro Hawk was a bust yet didn’t report this and continued paying for the program. If the German defense ministry under Thomas de Maizière (C.D.U.), Karl-Theodor zu Guttenberg (C.S.U.), Franz Josef Jung (C.D.U.) and Peter Struck (S.P.D.) ignored internal warnings for years saying this seemingly-unsolvable safety problem was unsolvable under the planned budget and schedule, then people in government appear to have been several hundred million euros certain they could eliminate the air traffic regulations rather than fix the engineering issue.

The Euro Hawk prototype delivered from California to Germany in 2011 twice lost contact with its operators, according to FAZ.net, for about ten minutes each time. When found again it had deviated from course and “even lost altitude.”

German voters already experience a frisson of angst if they see or hear military jets in the air because it reminds them of when hundreds of spectators were sliced and burned in the firey crash of fighter jets flying in formation at an air show over Ramstein air base. The notorious industrial band took the name Ramstein after the disaster as an act of provocation.

(ZELL bst shten dick   OW! ss vye chhen,   EYE geh n shten dick   OW! ss vye chhen.)

Wirtschaftsspionage

“Economic espionage,” industrial espionage. June 2013 reports that Germany was the N.S.A.’s most-spied-on country in the E.U. created German misgivings that financial advantages might be being sought.

The Guardian.co.uk’s “heat map” for the NSA’s “Boundless Informant” surveillance system indicated only countries like Iran, Pakistan, Jordan, Egypt and India were being monitored more than Germany.

This fear was not alleviated by Süddeutsche Zeitung and Norddeutsche Rundfunk reporting on 02 Aug 2013 describing Snowden-trove British General Communications Headquarters docs from 2009. It listed U.K. telecoms that “assisted” G.C.H.Q. (with each company’s code name): Verizon Business (“Dacron”), British Telecommunications (“Remedy”), Vodafone Cable (“Gerontic”), Global Crossing (“Pinnage”), Level 3 (“Little”), Viatel (“Vitreous”) and Interoute (“Streetcar”); some of these telecom companies even developed software to help spy on their customers and were paid for that by G.C.H.Q. “For the good of the British economy” was a reason given in a G.C.H.Q. PowerPoint presentation for why these telecoms were selling their customers’ communications.

Update on 19 Jan 2014: ZDF heute journal reported the listening post atop the U.S. embassy in Berlin was indeed used for economic espionage: they were interested in the Chancellor’s opinions about the euro currency, for example.

In 2003, the company Ferrostaal, headquartered in Essen, was competing with a U.S. company for a contract to deliver radio monitoring equipment to Nigeria. The U.S. embassy in Berlin supplied Ferrostaal’s U.S. competitor with data from Ferrostaal’s secret bid, according to an embassy cable found in the Wikileaks trove. Details ZDF showed in a copy of the cable included the German company’s offered price (24 million euros) and financing (“5.1 to 7.0 percent for possibly 5 years”). The U.S. company won the contract.

(VEE at shofts ess pee own OJ.)

Vollzugriff und verdachtlose Überwachung

Full access and suspicionless surveillance, what whistleblower Edward Snowden said the NSA and other US intelligence organizations have. In the same Guardian.co.uk interview, Snowden also criticized the NSA’s auditing procedures as practiced.

Mietspion

“Rent-a-spy” cybermercenaries, outsourced espionage.

Der Spiegel reported that NSA whistleblower Edward Snowden worked for a billion-dollar private company, like a “digital Blackwater,” called Booz Allen Hamilton. With $5.8 billion revenue in 2012? 70% of BAH’s stock is held today by Carlyle Group? Carlyle Group’s website said it has $176 billion “in assets under management” in 2013. A press release on Booz Allen’s website said Carlyle Group had $82 billion “of assets under management” in 2008, when they acquired Booz Allen.

With clients and branch offices around the world, what’s to stop a company that invents, obtains and markets cyberwarfare “solutions” from accelerating or even creating a cyberwarfare arms race by hard-selling hardware and software and hawkish advice to several competing countries at once?

Booz Allen’s locations include: USA, Azerbaijan, Georgia, Kazakhstan, Russia, Qatar and United Arab Emirates.

Booz Allen’s alumni include:

  • James Clapper, current Director of US National Intelligence
  • J. Michael McConnell, NSA Director (1992–1996) and Director of US National Intelligence (2007–2009)
  • R. James Woolsey, CIA Director (1993–1995)

(METE shpee own.)

Datenschutzsiegel

“Data protection seal of approval.” A 2008 book on data protection in Germany proposed creating independent auditing agencies who would inspect public and private organizations. If the organizations met standards for data protection, transparency, data security, etc., they would be issued the auditors’ “quality seal” which they could use in their marketing materials as a reputation booster. The auditors would be motivated to keep their own reputation high by not being pushovers, presumably. Multiple reliable auditors could watch each other. Set up well and done honestly, these inspections could ultimately enhance efforts at leak control by keeping whistleblowing from being the only way visible to try to fix the most broken organizations. When these inspectors published what criteria they used to calculate their ratings, smaller organizations down to families and individuals could learn tips about improving their own data protection.

Judging by online search results, squabbling about which data protection inspection seals are worthy may have already begun. There appears to be understandable concern that a company that produces consumer credit scores, which many Germans view with suspicion, also dipped its toe in the data protection certification business. Possible other models suggested for such an independent inspection system included the feared TÜV inspections and Biosiegel (“certified organic.” Bio means organic in German. Öko means treehugger.). An early boost was provided when a German state created demand for the certificate by requiring independent data-protection certification for products, programs and services used by state offices.

(DOT en shoots ZEEG ell.)

Steuersparmodelle für Grossunternehmen angehen

“Having a go at tax savings models for large companies,” what the EU is doing now that US firms have started testifying before Congress about still-legal systems of international tax loopholes partially revealed by the “Offshore Leaks” data trove.

From the Süddeutsche Zeitung’s description of some results from the 22 May 2013 EU summit in Brussels:

“At their meeting Wednesday the 27 leaders also talked for the first time about actions to be taken against tax savings models for large companies. With an eye on corporations like Apple, Amazon or Google, which avoid taxes on a large scale, British leader David Cameron said it is time to close the loopholes. He said one has to be sure that companies are really paying taxes. France’s president François Hollande demanded action against the ‘corporations’ tax tricks.’ Irish premier Enda Kenny was put under pressure because for years Apple has been using Irish subsidiaries to save billions of euros. Kenny said there aren’t any exception rules for international corporations. Ireland’s rules for taxing companies are ‘transparent and clear.’ The EU commission now plans to submit proposals for closing corporate tax loopholes by the end of 2013.”

(SHTOY ah SHPAH mode elle ah   foor   GROSS oont ah NAME en   ON gay hen.)

Europaweit

“Europe-wide.” A controversial Arte documentary has drawn attention to the new EU water guideline the European Commissioner for Internal Market and Services Michel Barnier (of Nicolas Sarkozy’s UMP party) is about to issue in which local European government water projects will accept bids from all of Europe. Water activist Jean-Luc Touly warned the current plans for the guideline will make it difficult for public utilities to compete against profit-driven private utilities that are, he said, not primarily motivated by consumers’ best interests. 80% of the French water market has been privatized, the 2010 Arte documentary “Water Makes Money” claims to show instances of corruption in that French privatization and there was an increase in French water quality problems post-privatization, Touly said.

Around the world, many privatization contracts appear to have gone to subsidiaries of just a few big companies such as Bechtel (USA), Enron (USA, now spectacularly bankrupt), RWE (Germany) and Suez/Veolia (France). Opening privatization of city water utilities to Europe-wide bidding might encourage reductions in international competition among these providers.

(Oy ROPE a v eye t.)

 

Rekommunalisierung

“Recommunalization,” remunicipalization. A twenty-first-century response to the twentieth century’s privatization trend. After experimenting with water privatization for over a century, for example, many French towns are now reacquiring privatized, for-profit utilities and turning them back into not-for-profit services.

This accords with the ideas of the great groundbreaking French engineer Henry Darcy who experimented with pipe, sand filtration and spring sources to create a technologically and socially advanced water system for the town of Dijon in 1840, a project he then carefully documented in a beautiful book published in 1856. My Texas colleague Patricia Bobeck translated it into English, including the following:

“As much as possible, one should favor the free drawing of water because it is necessary for public health. A city that cares for the interest of the poor class should not limit their water, just as daytime and light are not limited.”

[The Public Fountains of the City of Dijon, 42.]

Austerity measures may be increasing pressure on governments of financially troubled EU countries to sell off their water and other utilities such as Greece’s recent sale of 33% of the Greek state lottery and gambling organizer OPAP to the Czech-led consortium Emma Delta for 712 million euros (of which 60 million was dividends on profits from 2012). Wikipedia says OPAP is Europe’s largest betting firm and as of 2008 the Greek government only owned 34% of it.

(RAY com you noll iz EAR oong.)

Fantastillionen

“Lots of money,” an “unimaginable fortune,” but no one knows how much yet. The Münchener Abendzeitung reported reports, firmly denied, of account balances totalling several hundred million euros. Uli Hoeneß, the president of German soccer’s version of the NY Yankees, FC Bayern Munich, submitted a Selbstanzeige in January 2013 for unpaid taxes on funds in one or more Swiss bank accounts and has already paid an initial lump sum of about six million in unpaid taxes. He said he didn’t report himself before January 2013 because he was betting the tax agreement with Switzerland would be ratified that provided amnesty, anonymity and a low tax rate for “tax sinners.” Tagesschau.de reports that it’s still unclear where the untaxed monies came from, whether from his bratwurst factory or from other sources.

ZDF heute journal found footage of Hoeneß on talk shows such as the charming Günther Jauch’s in autumn 2012 recommending low taxes for rich Germans because otherwise, he said, they would move to Austria, Switzerland or “who knows where.”

CSU chair Horst Seehofer confirmed on Saturday, 20 Apr 2013, at a CSU meeting in a Munich Hofbräuhaus cellar, that the district attorney was looking into the matter. The CSU had been going to propose Hoeneß as a political candidate, and he probably would have been confirmed.

The Münchener Abendzeitung commented on 20 Apr 2013:

“The question remains whether Hoeneß can now hope for the same support from the Bavarian state government as Franz Beckenbauer, to whom Bavarian finance minister Ludwig Huber once gave tips about tax flight into Switzerland while Huber was still in office?”

Achtung: Focus Magazin’s publisher is on the board of FC Bayern Munich.

(FAHN tossed ill ee own en.)

Selbstanzeige

“Self reporting,” voluntary submission of an amended German tax return reporting money hidden in e.g. Switzerland. You can still report yourself to the German IRS, pay a low tax rate on the unreported funds, get immunity from prosecution and legally repatriate the money to Germany. The reason we know there are still Germans with Schwarzgeld, under-the-table or “black” capital, in Swiss bank accounts who have not taken advantage of the Selbstanzeige is because the German state governments, acting independently, buy CD’s of data about these accounts and use them to pursue tax sinners for fun and profits. The state of Rhineland-Palatinate recently bought another one, for the 500 million euros they expect to collect with its help and because no capital crimes were committed in the seller’s acquisition of it. ~200 apparently-related tax razzias took place on 16 Apr 2013. The RP finance minister is asking the other German states to show solidarity by contributing toward the purchase price because they too will be benefiting from the content. Lower Saxony has already announced they will contribute. Both states are ruled by SPD and Green Party coalitions.

The Selbstanzeige will soon be irrelevant because international negotiations are moving toward closing the loopholes, especially since publication of the “offshore leaks” financial data trove. Meanwhile, the Süddeutsche Zeitung writes in a wonderful history of bank account data sales to Germany, RP tax officials are “electrified” and say they’ve never had foreign bank account data this good before. “First class.” It sounds like enough years of transfers and other information are included that, after the tax authorities are done with it, the CD could form the basis of some interesting doctoral theses.

The top Rhineland-Palatinate tax agent now says he sees the recently failed tax agreement with Switzerland as disadvantageous, because it provides a partial amnesty and would destroy tax payment morale were it to be ratified now.

(ZELBST on ts eye geh.)

 

Generalsekretariat für Staatseinnahmen

“General Secretariat for Revenues,” a newly created department in the Greek government responsible for checking government income. Its head used to be in charge of the Greek General Secretariat for Information Systems (GSIS). In response to the “Offshore Leaks” data release last week, the Greek Revenues office will be investigating, among other things, a chain of offshore companies that have been providing military technology to Greece and the USA but whose actual ownership remains a mystery.

The Süddeutsche Zeitung reported: “Interoperability Systems International Hellas S.A. […] was co-awarded a 190-million euro order in 2003 for kitting out Greek F-16 fighter jets. The company also delivered hardware and software to the US Marines. In 2003, 33% of ISI belonged to Bounty Investments Ltd., which in turn owned part of another offshore company. Over that company there was a third veil as well. An attorney for ISI Hellas said Bounty Investments ‘fulfilled all requirements of the Greek tax authorities.’ Some experts think companies in the defense sector fundamentally ought not to be messing around in cloudy offshore waters.”

Update on 10 Apr 2013: This highly entertaining* SZ article about a British family that managed letterbox companies (Briefkastenfirmen) in New Zealand and includes Miami, Moscow, Pyongyang, Teheran and Vanuatu notes that it becomes impossible to trace ownership after only three to four “dummy companies” (Scheinfirmen). “After three, four dummy companies in a row the track gets lost in a thicket of commercial registers (Handelsregister, HRB).”

(Genn er OLL seck rett arr ee OTT   foor   SHTOTS eye nom men.)

 * highly entertaining until the deaths of two Russian reformers at the very end of the piece: Sergej Magnitskij (37) and Alexander Perepilitschnij (44).

 

Partnermedium

Partner member of the media, what the Süddeutsche Zeitung is calling the other news organizations that received copies of the “Offshore Leaks” data trove. The SZ has posted a map showing the countries known so far to contain such media outlets and a list of the latest important discoveries.

(POT nah may dee OOM.)

Durchgangssteueroase

“Pass-through tax oasis” or “flow-through tax oasis,” in a third country; also called a Vertragssteueroase (treaty tax oasis). The fierce discussion triggered in Germany by the publication of what is being called the  “Offshore Leaks” data trove on 04 Apr 2013 has moved from international tax avoidance by individuals, usually heirs in journalists’ examples, to international tax avoidance by companies, not least because these schemes do require a complex web of service providers and subsidiaries to move the money around. So, say your company earns income in a foreign country where your country has a double taxation agreement* with that country’s government not to tax it. As a first obfuscatory step, you can transfer this money to a Durchgangssteueroase, a third country that also has a nontaxation agreement with the country where you earned the income. The Netherlands is one of the world’s biggest pass-through tax oases because of agreements they’ve made with Asian countries that do a lot of manufacturing.

Income can thus be transferred out of high-tax countries to a pass-through tax oasis such as Mauritius to a zero tax oasis (Nullsteueroase) such as the Cayman Islands. Hans-Lothar Merten’s book “STEUEROASEN Ausgabe 2013: Neue Einblicke in die Offshore-Welt” explains that countries acting as pass-through tax oases justify being the first step in the chain by saying they are providing an important service in avoiding double taxation but, he says, what they are providing is in fact double nontaxation. ~20 trillion euros flowed through the Netherlands in this manner in 2012, Merten said [p. 29]. Ireland has provided useful related services.

German media are also reporting, or perhaps repeating each other’s examples of, perfectly legal situations where international companies’ foreign subsidiaries reduce their local net income by paying high licensing fees—for the rights to use their parent company’s brand—to subsidiaries in low-tax countries, perhaps while also deducting their expenses in high-tax countries.

(DOER chh GONGZ SHTOY er oh OZ iss.)

* Durchgangssteuerungsabkommen, “double taxation agreement,” “double tax treaty”: country A makes a (bilateral) agreement with country B to not tax income earned by country B people in country A. However, people who are residents of neither country can take advantage of the advantages by hiring an intermediary. The result is international flows of capital that are, writes Hans-Lothar Merten, inexplicable for any reason other than double taxation agreements and so-called “treaty shopping.” He cites the example of the island of Mauritius, which has double taxation agreements with ~50 other countries. Cyprus had them with ~45 countries, according to Wikipedia, with more in negotiation.

Kapitalverschleierung über Steueroasen

“Using tax oases to veil capital.” Methods for doing this were disclosed by financial data about 130,000 people, in 170 countries, >120,000 “mailbox companies,” >260 GB in >2 million documents from a time range of ~30 years sent anonymously to the International Consortium of Investigative Journalists over a year ago. The story hit the world press on 04 Apr 2013. Greek and Filipino tax authorities announced that they will be investigating. The vice president of Mongolia‘s parliament will probably have to resign. Some of the still-legal methods to create tax opacity to be gleaned from the data were shown to have been used by the Deutsche Bank in Singapore, which had an intermediary agent (Trustverwaltungsfirma, “trust administrator company”) create >300 companies in so-called tax paradises (Steuerparadise).

In response: Gerhard Schick (Green Party) suggested Germany follow France’s example of levying an additional tax on all transactions with low-tax countries, disincentivizing tax flight (Steuerflucht) by neutralizing the advantages. Joachim Poß (SPD) proposed “an international anonymous NGO and a comprehensive information exchange, starting here in Europe.” The Leftists party proposed following the USA’s example of linking tax obligations to citizenship, so that every German residing abroad would be obligated to report “their total income every year, how much property they owned in total and what taxes they had had to pay for that in the Seychelles that year. And the difference between that and their German tax obligation” would then have to be paid in Germany, said Gregor Gysi (Die Linken).

The Süddeutsche Zeitung reported that they and NDR were the two German media outlets given access to the data (of “the biggest leak in world history”), and furthermore that a representative of Finance Minister Wolfgang Schäuble requested access to the data on Thursday, 04 Apr 2013, but the SZ would not grant that request. The data were protected under freedom of the press (Pressefreiheit), which includes protecting one’s sources, the Süddeutsche wrote. Sharing the data with government authorities might endanger those sources and obstruct the SZ’s ongoing research. NDR also refused the request to share the data. Now Focus magazine seems to have acquired the data somehow.

Update on 06 Apr 2013: “I have a certain degree of pleasure from the fact that this public scandalization in all countries has very much increased the pressure,” said German finance minister Wolfgang Schäuble with quiet satisfaction on 05 Apr 2013. “And now we have better chances to make progress faster than was possible in the past.”

Critics say the German finance minister has to be kidding because everyone’s known about this for years. If Schäuble were serious, they say, his office would be drafting new legislation. Income tax is regulated state-by-state in Germany, for example, and some people are calling for it to be centralized, made into a uniform federal-level taxation system with fewer “tax bait” niches. The OECD seems to be the locus for international negotiations in response to the new information; that group wants to issue a list of proposed actions in response to the “Offshore Leaks” data trove by July 2013.

(Cop ee TALL fer SHLY er oong   üüüberrr   SHTOY er oh OZ en.)

Blaupause

To this foreigner, Blaupause looks like “blue break,” which might indicate a nice use of free time in a well-situated beer garden because “blue” means drinking in Germany. But the word actually means “blueprints.”

New ESM head Jeroen Dijsselbloem angered some small countries whose economies are dependent on a large banking sector or at least threatened by large bank failures when he indicated that elements found to work in what the EU does in Cyprus—reduction of a banking sector that had grown to 7x the size of the country’s economy, reregulation of the remaining banks—could be applied to other Member States that get in too much trouble.

About Cyprus: German news reports that, during the past fortnight of negotiations when large transfers from Cypriot banks were supposed to be frozen, over a billion euros were nevertheless transferred off the island by foreign banks, mostly in London. A whistleblower list has appeared containing names of parliament members, local officials and associated companies and organizations that received millions in loans between 2007 and 2012 from the country’s two largest banks (Bank of Cyprus and Laiki Bank, plus Hellenic Bank in only one instance so far) but did not have to pay the full loans back. The only Cypriot political parties not represented on that list were a social democratic party and an environmental party, fwiw. A second whistleblower list is expected to appear containing names of large deposit holders who managed to get their money off the island just in time.

The corruption details cited in the Spiegel article were reported by the Cyprus news portal 24h.com.cy, Greek journalist Kostas Vaxevanis, and the Greek newspapers Ethnos and Kathimerini.

(Bl ow! Pow! Zah.)

Dividendenstripping

Dividend stripping.” A tax avoidance scheme the HypoVereinsBank is accused of, wherein they allegedly transferred customers’ stocks back and forth between German and foreign banks until it was unclear whether the Kapitalertragssteuer had been paid and then claimed more capital gains tax credits than were owed. Reuters and the Süddeutsche Zeitung reported that a single Frankfurt investor working with HVB and other banks was told he owed 124 million euros in tax for 2006–08 after the IRS-equivalent refused to accept his capital gains tax break from the scheme; he has been fighting in court since 2011 to get HVB to pay the tax bill. HVB and this investor split the profits 65% HVB, 35% investor. Wikipedia says dividend stripping lost its tax-law basis in 2000, Spiegel says it hasn’t been accepted by German tax authorities since 2007, and Süddeutsche Zeitung says since 2012.

Weird story about the HypoVereinsBank in Spiegel-Online on 30 Nov 2012: A guy accused his ex-wife and other HVB employees of large-scale tax avoidance schemes that moved money to Switzerland, was declared non compos mentis by the Bavarian justice system and has been locked up in a mental institution ever since (2006). The man probably was violent, but he may have been correct about the tax avoidance. He cited names and numbers when he blew the whistle to the Bavarian tax authority, but a judge who was not involved in that case called the tax office and told them not to investigate the bank because the whistleblower was crazy. The institutionalized whistleblower’s case was re-opened in 2013. He was set free  in the summer of 2013, after seven years of confinement. Laws committing people to mental institutions and keeping them there are going to be reformed as a result of his case. This started with an 05 Sep 2013 decision by the supreme court in Karlsruhe, the Bundesverfassungsgericht, which prioritized a review of the whistleblower’s case and announced failures of the various state courts and criteria that need to be met in future.

The Frankfurt district attorney’s HVB razzia last week found a trail leading to “a Swiss private bank.” Süddeutsche Zeitung says it is thought that Swiss banks will be a very fruitful place to investigate this German tax scandal. Deutsche Bank and UBS are now implicated as well.

Update on 16 Dec 2013: HSH Nordbank has been accused of dividend stripping.

(Dee veed END en shtrrrip pink.)

Blog at WordPress.com.