Bloomberg warns world of New Zealand’s toxic trusts

Written By: - Date published: 7:56 am, February 12th, 2017 - 21 comments
Categories: Abuse of power, capital gains, Globalisation, labour, national, Politics, same old national, tax - Tags:

Mr Low Taek Joh may not be a familiar name to many here, but he is a very concrete example of how this current New Zealand government’s weak regulation has enabled the super-rich to get legal advice from Panamanian law firm Mossack Fonseca, set up trusts here, and through Auckland siphon billions of corrupt dollars wherever they want.

This is part of the massive 1MDB fraud that has been shaking Malaysia and Singapore for most of last year. It’s serious stuff, and Mr Joh is a named person of interest.

Concerning these dark arrangements, Labour has called for a public register of assets, and to name their beneficiaries. Better known as “sunlight is the best disinfectant”.

Despite a government inquiry in the wake of the Panama Papers leak concluding that there was a reasonable likelihood that the New Zealand trust system “is facilitating the hiding of funds or evasion of tax in some instances”, we have yet to see the rules tightened. Steven Joyce said it was important to tighten the rules. In an interview with Bloomberg last week, Minister of Finance Joyce said, “New Zealand is seen as a fair dealer and responsible player on the world stage. You have to meet the market as things change.”

But the one thing we know about massive illicit capital, is that it flows like mercury to the global point of lowest resistance. And poisons everything in its path. There were 11,500 such trusts operating in New Zealand by the end of last year. We need sunlight on them; massive foreign incoming capital should prove that it is clean, not measure degrees of dirt.

We need a fresh government that doesn’t merely “meet” the market: when it comes to financial regulation they have to form the market: control it, channel it, resist it, and tell people like Mr Low Taek Joh that we don’t need your legal fees, don’t need your poisoned hyper-fluid money, and don’t need them in our country.

21 comments on “Bloomberg warns world of New Zealand’s toxic trusts ”

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  1. Nick 1
    12 February 2017 at 8:16 am

    But, but, sausage sizzle expert ShonKey said everything was fine……even his bread butter lawyer buddy agreed…. Want onions on that Natz?

  2. Bearded Git 2
    12 February 2017 at 8:34 am

    The Natz review of the trusts resulted in no change to the secret regime while claiming the opposite. It says everything about Joyce that he comes out with this NZ is a “fair dealer” bollocks.

    Labour needs to highlight a policy of creating a publicly available (online, simply by clicking) list of overseas trusts showing beneficiaries in the election campaign. In fact the whole shonky trust regime, domestic and overseas, needs an enquiry.

  3. dukeofurl 3
    12 February 2017 at 9:13 am

    NZ abolished gift duty purely to favour these foreign trusts – not that we would collect any taxes from them anyway- so that the so called independent Trust could make ‘tax free’ payments to the people who provided the money in the first place.
    The money would never come through NZ but the paperwork would look all good and they could say ‘all required taxes had been paid’.

  4. Draco T Bastard 4
    12 February 2017 at 2:21 pm

    We need sunlight on them; massive foreign incoming capital should prove that it is clean, not measure degrees of dirt.

    Actually, there shouldn’t be any incoming or out going foreign money. At all ever in any country.

  5. Tamati Tautuhi 5
    12 February 2017 at 3:16 pm

    Hopefully it will all come out in the wash?

    However like the Winebox Enquiry and the collapse of the BNZ, I doubt whether the NZ Judiciary and the Serious Fraud Squad would find anything of substance as we are the least corrupt country in the world. Don’t expect anything to happen under this Governments watch.

  6. JustMe 6
    12 February 2017 at 3:37 pm

    What an awful legacy John Key has left NZ in. He is on record as saying he wants NZ to be the “Switzerland of the South Pacific”.

    And so to date we have also seen the various multi-corporates getting away with daylight robbery when it comes to paying taxes here in NZ. I now wonder as to how much in ACC has the multi-corporates have ever paid???!!!!
    If no taxes have been paid by the multi-corporates then it’s 100% likely that they haven’t even paid any ACC. That could well explain why ACC is in a deficit

    and not a surplus.

    This government has a cavalier attitude and approach to matters that involve Trusts, Multi-corporates etc doing what they can.

    But this all demeans NZ and NZers and yet this government lets it happen. My question is Why? Is it because the rich are more popular to court outside of election time than the poor? Is it because in return for say “Instant Kiwi citizenship’ huge donations are made to the Political Party of the government of the day i.e enough of a donation and this government turns a blind eye?!

    RIght now Bill English is trying to court the LGBT community. That proves to me that where the likes of Bill English are concerned they(English and his ilk)will only court others when there are votes required. Outside of that time we are ignored. But English and Co actively court the rich for their own purposes once the votes have been counted.

    We have a government who lives in denial when it comes to the common people of NZ. And at the same time they claim the economy is improving. If the economy is improving then why are there children living in poverty? Why are there people living in vehicles, garages or sheds? Why does this government not see what is obvious to everyone else?

    Obviously Planet Key is still doing well under temporary pm English.

  7. Tamati Tautuhi 7
    12 February 2017 at 4:29 pm

    The problem is most people in New Zealand are politically disengaged, they only open their ears and eyes every three years and believe the narrative MSM tell them, interesting 90% of MSM are controlled by 6 companies.

    We are coming off the back of a hugely popular National Government who has had a PM who has had celebrity like status and was dearly loved by a majority of New Zealanders and the NZ Press who fawned over him. His personal development and business acumen which took him from a State House upbringing in Christchurch to the Boardrooms of high finance in Europe and New York. Not to mention the Rockstar Economy which developed under his watch. Opposition parties have got a lot of work ahead of them to match the economic performance of this National Government over the past three terms and the development of the “Rockstar Economy”.

    The safe pair of hands of Bill English has already returned the country into an Economic Surplus.

  8. Carolyn_nth 8
    12 February 2017 at 6:01 pm

    Mossack and Fonseca have been arrested for money laundering according to RNZ.

    The arrests are related to corruption and bribery allegations involving a Brazilian construction firm, Odebrecht.

    Ramon Fonseca and Jurgen Mossack, who were partners at Mossack Fonseca, face charges of money-laundering.

    The Panama Papers leaks involved millions of documents stolen from the law firm and leaked to the media in April 2016.

    The papers are reported to have come from corporate businesses in countries including New Zealand.

    They showed how some wealthy people were using offshore firms to evade tax and avoid sanctions.

    Announcing the arrests, Panama’s Attorney General, Kenia Porcell, said information “allegedly identifies the Panamanian firm as a criminal organisation that is dedicated to hiding assets or money from suspicious origins”.

    …
    Odebrecht has admitted to paying $1 billion in bribes to obtain contracts in 12 different countries.

    Mossack Fonseca denied wrongdoing in the case and said it was the victim of a computer hack. It maintained the information leaked was misrepresented.

    Mr Fonseca served as a minister in Panamanian President Juan Carlos Varela’s government, but stepped aside earlier in 2016 after separate allegations linked his law firm to the corruption scandal engulfing Brazil’s state oil company.

    • Ad 8.1
      13 February 2017 at 8:13 am

      New Zealand is going to get pulled into this trial big time, and ridiculed.

      The document dump only went up to 2013, and Mossack Fonseca didn’t slow down.

      Let’s see if English has half a brain and accelerates his tepid little reforms in disclosure through the House.

  9. Tamati Tautuhi 9
    12 February 2017 at 8:32 pm

    Family Trusts here in New Zealand?

    Our family solicitors set up a Family Trust for my grandmother in the 1960’s, however her assets were never transferred into the Trust.

    I have tried to trace things through solicitors, however have had little luck, evidently the Family Trust never operated as such and there are no records on file?

    Family archives were uplifted and I assume were destroyed by family solicitors? Hopefully not?

    Evidently solicitors only have to keep records for 10 years then they can be destroyed?

    Any solicitors or bush lawyers on this site who can provide any professional advice?

    Very difficult to trace things when there are no family records or archives to refer to, you can understand how early land transactions here in NZ are hard to quantify or qualify especially when Maori were not required to enter birth registrations until 1920?

  10. PTSD 10
    13 February 2017 at 5:22 pm

    NZ Domestic trusts also are corrupt .One is forced to pauperise oneself to get trust info, then Solicitors say they forgot, did not know they had to inform, minutes are withheld, small trown mates help, asssets disappear, non contact orders are thrown around etc etc, all designed to hide behind a deceit (woops I mean Truist) etc etc etc… medieval trust law which started with 13th century Knights invading Palestine should be outlawed.

    • Tamati Tautuhi 10.1
      14 February 2017 at 2:50 am

      Tried to find out some information on a Family Trust set up in the 1960’s by the family solicitor who controlled by grandmothers affairs. According to the family accountant the Trust was set up but the assets were not transferred into the Trust, so how does one find out what the solicitor did with the assets. Evidently solicitors only have to hold records for 10 years? Anyone got any clues?