Archive for July, 2009


 

 

FOR IMMEDIATE RELEASE:
FDIC Certificate for Halloween Bank Tricked IRS Says Ripped-off Estate
Washington, D.C. and Fort Wayne, Indiana, June 22, 2009- On Halloween 1969, the FDIC issued Certificate #20070 to an extraordinary national bank in Fort Wayne, “Allen County National Bank.”

“There was never a physical ‘Allen County National Bank’ in Fort Wayne,” affirms Leigh Fulghum, Personal Representative of her grandfather Kryder’s 1966 estate currently open in Allen County, Indiana. With fifteen years historical research and data to support her conclusions, Fulghum reasons the FDIC certificate concealed property belonging to at least five Allen County estates, from heirs and the IRS.

Information supplied by the FDIC Legal Division in Washington, D.C. states that “Allen County National Bank, FDIC Cert.#20070,” bearing no date of creation or origin, was insured on 10/31/1969 and merged into Lincoln National Bank and Trust Company of Fort Wayne on 11/04/1969 under the Lincoln charter. Fulghum says when Cert.#20070 was issued in 1969, the Kryder family tax-exempt U.S. government securities originating from before World War I through 1954 were due to be probated and taxed once and for all by 12/02/1969 when the estate of Frank H. Kryder should have closed. Instead they appear to have vanished.

The Comptroller of the Currency carefully maintains a Certificate of Charter for every legitimate national bank. But there is nothing on file with the Comptroller for “Allen County National Bank.” Nor is “Allen County National Bank” in the database of the Federal Reserve or mentioned in the Lincoln bank’s history in the FDIC public access database, or in the corporation records of the State of Indiana.

In the official records of Allen County are town plats and deeds to hundreds of houses which verify the Kryder family owned land they bought with gold, subdivided and built neighborhoods, sold insurance, and were organized in a national farm loan association. But none of the proceeds were ever accounted for.

“My grandfather was an alcoholic and his three children from two marriages had for many years lived apart from him. Estrangement and sadness made him a mark. When he died in 1966, his corporation, tax and estate lawyers lost the records of his and his parents’ 50-year old real estate development and insurance company,while the State of Indiana lost the files of their building company. They lied to his heirs-at-large whose interest was designated in a recorded Trust, and nearly starved his widow. When she died in 1983, the funeral home applied for a Social Security death benefit on her behalf, then a cut a check drawn on the Lincoln National Bank and Trust Company back to the lawyers.”

“The family always lived modestly on interest and thought they were safe investing their gains in government bonds. Their plan was derailed since ownership of even registered U.S. government securities is easily concealed by a buried FDIC Certificate Number issued to a shell national bank, ” reports the Kryders’ Personal Representative.

Leigh Fulghum as Personal Representative for the Estate of Frank H. Kryder in the Superior Court of Allen County, Indiana
U.S. Mail Address: 398 E. Dania Beach Blvd. #298, Dania Beach, FL. 33004
(954) 922-2066 Phone and Fax; e-mail: estate@frankkryder.com

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Taking someone’s security clearance away has almost been a stereotypical action by many agencies in DoD as a part of the “deal with the whistleblower” strategy.  Trumped up justifications are too easy for them to throw together, and although they are trumped up, are very difficult to fight.  It is difficult to get one’s clearance back, particularly in a timely manner.  And most DoD employees must have their clearance in good standing in order to perform their jobs, and in many cases even report to their offices to work each day.  This is a hopeful ruling. 

-GFS

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Judge Says Army Must Answer For Denying Security Clearance to Whistleblower Bunny Greenhouse

 

Washington, D.C. July 28, 2009.   U.S. District Judge Emmet G. Sullivan ordered yesterday that the Army Corps of Engineers must answer for its decision to withhold top-secret security clearance from whistleblower Bunnatine (Bunny) H. Greenhouse. “This decision sets a new precedent for the protection of national security whistleblowers,” said Michael D. Kohn, President of the National Whistleblowers Center and Greenhouse’s attorney.

Bunny Greenhouse was the Corps’ top procurement executive when she objected to the terms and legality of a no-bid contract the Bush Administration was about to award to Halliburton subsidiary KBR a contract just before the Iraq War commenced, known as Restore Iraqi Oil (“RIO”).  Greenhouse’s concerns were ignored and the no-bid, cost plus contract, worth up to $7 Billion, was secretly awarded to KBR to run Iraqi oil fields after the invasion. When Greenhouse was scheduled to testify before a Congressional Committee during the Bush Administration, the Army Corps’ then acting General Counsel personally advised Greenhouse it would not be in her best interest to do so and she was swiftly removed as the Army Corps’ Procurement Executive when she ignored that warning.   Greenhouse alleged that the Corps further retaliated against her by refusing to renew her top-secret security clearance (TSSC) on grounds that her new job did not require any clearance.

Greenhouse filed a lawsuit to get her old job back.  In a ruling yesterday, Judge Sullivan overruled the government’s motion to dismiss Greenhouse’s claim for her TSSC.  

Judge Sullivan acknowledged that existing case law establishes that “an adverse employment action based on denial or revocation of a security clearance is not actionable” if it would “require the court to assess the merits of the decision to deny the clearance – precisely the assessment prohibited by the Supreme Court’s holding” in Department of the Navy v. Egan, 484 U.S. 518 (1988).”  Judge Sullivan establish new precedent, holding that “the decision to strip Greenhouse of her security clearance was based on the Corp’s claim that Greenhouse didn’t need it any more based on the jobs they intended her to perform” thereby making it “entirely unrelated to any security-sensitive considerations.”  
 
Kohn called Judge Sullivan’s decision is “well reasoned.”   “Otherwise, an agency could marginalize a whistleblower by failing to renew a security clearance for reasons that had nothing to do with security and everything to do with retaliation.”  Kohn said.  “A blanket refusal to permit a court to review the reasons for the denial of security clearances normally leaves national security whistleblowers completely vulnerable to retaliation.  This decision highlights how a decision to withhold security clearance can have nothing to do with national security and everything to do with unlawful retaliation,” Kohn added.

A copy of the decision is attached here

 

 

Link to original:  http://www.whistleblowers.org/index.php?option=com_content&task=view&id=904&Itemid=71

For those of you unfamiliar with Ms. Sparky’s blog concerning KBR Electrical Failures, Death of Soldiers due to Faulty Electrical Work in Iraq/Afghanistan, please follow the links and read on.  It is well worth your time.  If the links aren’t working, go to Ms. Sparky’s website at:  http://mssparky.com/

 -GFS

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Ms. Sparky’s Blog Updates

 

 

I have been traveling and am behind on my comment responses. I hope to get those caught up within the next day or so. Thanks to my faithful readers for their insightful comments. 

 

To read all of my recent posts click HERE and scroll down.

 

The big news is the Department of Defense Inspector General’s Reports are out on the electrocutions in Iraq and the electrical situation is Afghanistan. There are three full reports.

 

In summary…the DoDIG found KBR responsible in part for the death of SSG Ryan Maseth who was electrocuted in his shower. The DoD is also found responsible for their lack of oversight.

 

If you can get to Ms Sparky I have them all posted. If you can’t click HERE to go to the DoD IG website to download them. They will be the three dated 7/24/2009. If KBR has blocked that site as well, email me and I will send them to you.

 

One would hope the Army CID would be filing criminal charges soon. I hope Fluor, Dyncorp, CSA and every other DoD contractor is taking notice. Unsupervised play time in the “sandbox” is over!

 

I am working on a lawsuits page that will list all the lawsuits against KBR and any suits that KBR has filed with regards to LOGCAP. If you know of a lawsuit filed against KBR shoot me an email. If you can send me a copy of the petition/complaint that would be great.

 

I have also added several new categories including “Indictments, Convictions & Arrests” hopefully we will be getting some more of those with regards to the electrocutions.

 

I am still getting a ton of complaints about CSA in Kuwait. I don’t know what the DCMA is doing down there. But you must contact the DoDIG with EVERY complaint. Click HERE to read about that. So far not too many complaints about Fluor…yet. But I am so afraid the way CSA, Dyncorp and Fluor are sucking up KBR managers that they will be turning into KBR times 3!!

 

I get asked all the time how to report Fraud, Waste and Abuse to the DoD. I have blogged about it before click HERE for that. So many people are afraid to contact their companies own ethics hotline because of threats of retaliation. Please report any retaliation to the DoDIG Hotline as well. If in doubt just report it. Be specific. Don’t use acronyms. The hotline number is open M-F 8-5 EST. Or you can email them anytime.

 

 

 

 

I have been getting some complaints that people are calling in reports and then calling back to follow up and the hotline is claiming they have no record of the call. I strongly suggest that you email the report and make sure you keep a copy for yourself.

 

If you have any information about prostitution rings in the DoD camps in Iraq, Afghanistan, Kuwait or in Dubai, Thailand the Philippines or anywhere else for that matter please email me. You can read my post on that HERE.

 

I have gotten several emails about what is going to happen in Afghanistan with regards to KBR employees and the transition. I recommend you keep doing your job the best you can. Fluor and Dyncorp aren’t keeping me as updated as I would like (sarcasm), but I find it hard to believe they would not pick up many of the craft and people who actually do the work. It just doesn’t make financial or logistical sense to start out at ground zero. It’s the majority of KBR management who need that one way plane ticket to the States. So just be patient and flexible.

 

I know KBR is going to put on the pressure with threats and intimidation. That is their MO. Just be smart! They can still fire you.

 

Also, I am looking for few former O&M crafts. All trades. Shoot me and email. Thanks.

 

If you have questions you can email me by replying to this Update.

 

Be safe!!

 

 

Ms Sparky

(aka Debbie Crawford)

Senate Markup Of Whistleblower Bill Wednesday at 10:00 a.m.

Take Action!

 
The Senate will be marking up its version of the

Whistleblower Protection Enhancement Act of

2009 (S. 372) this Wednesday.  Now is the time to

contact your Senators and President Obama and

ask them to support adding jury trials for all

federal employees, including national security

employees.

Take Action! Demand Court Access for All Federal Employees!

 

You can watch the Senate markup live starting at

10:00 a.m. on Wednesday from the National

Whistleblowers Center homepage.  You can also

follow the markup on Twitter @ StopFraud.  NWC

 General Counsel David K. Colapinto will provide

his expert analysis and commentary on how the

Senate markups affect the strength of the

whistleblower protections in this legislation.

Take Action! Tell the Senate to Enhance Protections for All Federal Whistleblowers!

Please pass this message on to your friends and

family.  We need the Senate and President Obama

 to know that the American public wants all federal

 employees to be protected when they report waste,

 fraud, and abuse of taxpayer dollars.

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Senate Markup On Whistleblower Bill Tomorrow at 10:00 a.m.

Tuesday, July 28, 2009 11:14 AM

From:

“Lindsey M. Williams” <lmw@whistleblowers.org

National Whistleblowers Center
3238 P Street, NW
Washington, D.C. 20007
http://www.whistleblowers.org

FOR MORE INFORMATION, CONTACT:  

       Stephen M. Kohn  (202) 342-6980
David K. Colapinto (202) 342-6980
Lindsey M. Williams  (202) 342-1903

FOR IMMEDIATE RELEASE

SENATE MARKUP OF WHISTLEBLOWER BILL TOMORROW AT 10:00 A.M.

Washington, D.C. July 27, 2009.  The Senate Committee on Homeland Security and Governmental Affairs will be marking up its version of the Whistleblower Protection Enhancement Act of 2009 (S. 372).  The markup will be held in Dirksen Senate Office Building Room 342 at 10:00 a.m.  

In a statement issued on behalf of the National Whistleblower Center, Executive Director Stephen M. Kohn stated:  “We urge the Senate to amend S. 372 to include key protections contained in the House version of the bill (H.R. 1507).  The House bill covers for all federal employees and ensures that federal workers can have their case heard in court by a jury of their peers.  The House bill also ends the 30 year old exclusion which blocked national security whistleblowers from protections.”  

During the presidential campaign, the Obama campaign endorsed the House bill, as did numerous other leading candidates, including Secretary of State Hillary Clinton and former Arkansas Governor Michael Huckabee.

NWC General Counsel David K. Colapinto will provide expert analysis and commentary on how the Senate markups affect the strength of the whistleblower protections in this legislation on Twitter @ StopFraud.  Mr. Colapinto has represented federal employee whistleblowers for over 20 years and has been actively involved in the legislative development of both bills.

*****

Someone from Whistleblower 411 (Yahoo Group)  sent me information about prior problems involving money gone missing, allegedly because of Hidden Treuhand use.  S/he said they exposed FDIC Fraud linked to Hidden Treuhand for the years 2004 to the present date.  I have not verified that indeed European Hidden Treuhand was actually involved in the Kryder case described in the link below.  This site is rather complex and involved.  It will take some time to decipher it.   Do you like historical and financial mysteries complete with the expected intrigue and skullduggery?   Let me know what you think.  And if you have any knowlege or information about this, contact the Kryder family estate. 

 

I’ve received a large amount of information from the estate this evening.  It is an interesting story, if you follow the link  to their site and look at the various menu choices on the left.  Quite a long period of history and quite a story.  I will be posting more about this in the future.  -GFS

 

Here is the link for the Kryder estate site:

 

Where is Kryder’s Money?  http://www.frankkryder.com/

Hidden Treuhand:  How Corporations and Individuals Hide Assets and Money

By Shelley A. Stark

 

Synopsis

What part is Hidden Treuhand playing in the ensuing global financial crisis? The Hidden Treuhand is the single most powerful business tool in the world of globalization today. It is the missing key, reshaping the world’s financial system though few have ever heard of it.

With a Hidden Treuhand you can anonymously exercise complete economic rights in all commercial markets worldwide hiding assets and money from stockholders and taxation alike.

 Many are unaware that U.S. corporations are using Hidden Treuhand to hide the scope of their economic activities – for example – Halliburton. From banks to bailouts, to shareholder value and pension funds – wealth is disappearing. How is it possible to hide stockholder wealth or economic activities worldwide?

Hidden Treuhand is a trade secret of elite European lawyers and powerful banking interests – creating a shadow economy and banking apparatus facilitating movements of money to tax havens. Powered by globalization, it has moved beyond European borders and is working undetected within the capitalist free market secretly affecting the world economy.

 How does Hidden Treuhand work? Who benefits? Who loses? This is the first book ever written, a ‘how-to-book’, that tells the story of Hidden Treuhand and how it is impacting the world economy and your financial security.

 

About The Author

Since 2004, Shelley A. Stark has been researching Hidden Treuhand legal practice, case studies, and history. Shelley holds a B.A. in Management and a M.A. in International Relations and Finance from Webster University in Vienna, Austria. She became keenly interested in Hidden Treuhand when she discovered some of its uses. Subsequent studies and interviews coupled with German law (ABG) explain Hidden Treuhand, how it is created and administrated, how it can be used by corporations, individuals, criminal organizations, and terrorist financiers. This well-researched original work has led to the first documented account of Hidden Treuhand and tactics used to undermine national security and impact global financial security.

 Hidden Treuhand:  How Corporations and Individuals Hide Assets and Money by Shelley A. Stark is now available on Amazon.com and Barnes and Noble.

In the Age of Stealth Wealth – Bank Secrecy is Alive and Well!

Written by Shelley Stark author of: Hidden Treuhand: How Corporations and Individuals Hide Assets and Money 

Bank Secrecy Bites the Dust in Europe”- Newsweek. “Switzerland, Luxembourg, Austria Loosen Secrecy Rules” – Bloomberg. “Tax Havens Give in to EU Pressure” – Spiegel ONLINE.

Has banking secrecy finally come to an end? This is what newspapers are unanimously saying. Is it true or should these headlines be punctuated with a question mark? Well, once again Switzerland, Austria, Luxembourg, Liechtenstein, and Belgium too are in the spotlight for their bank secrecy rules. There have been strong words emanating from the international community in the past and they produced little, or we would not be entertaining headlines such as these today. 

Changes to bank secrecy have come along way since the day of the anonymous savings book (‘Sparbuch’ in the German language). On January 1st 1994 some provisions concerning banking secrecy were partly amended in response to concerns of money laundering, but these provisions were largely undertaken on a voluntary basis by each bank. Up until this time, one could simply show up at the bank with $10 or $10 million dollars, and put it in anonymous savings account.  It was anonymous because you didn’t have to show any identification. The bank account was identified by a secret password, which the owner of the account assigned to the savings book and was subsequently registered in the bank. To get the money, you would have to show up at the bank with the savings book and give the secret password. This means in reality, to make a pay-off as seen in spy-thrillers, nobody needed to run around with suitcases of money. One could simply make a pay-off by handing over the savings book with the password and the recipient could visit his money at leisure. The new account holder could change the password to afford more security, but as longs as he had the savings book and the password, the money was safe and the old owner could not obtain these funds. Of course, this also meant if the savings book was lost or the password forgotten, then no one could access the money. The password account is much like its Swiss cousin the numbered account. The concept of the number and the password account originated when Hitler sought to stem the flow of money seeking a safe haven in Switzerland and in Austria. The capital exodus began due to inflation, but later due to Nazi persecution of Jewish citizens, it was feared that Hitler would try to force the Swiss to reveal Jewish accounts. By giving out numbers, the Swiss bank could claim not to know whom the account belonged to. In Austria, the practice became passwords. 

In 1995, Austria became a member of the European Union. Many of the earlier voluntary duties became law so that by November 1st 2000 the ability to open anonymous accounts was finally ended and no payments or withdrawals could be made to existing accounts unless the bank identified the identity of the savings account holder and money laundering was finally rendered a criminal offence. Tax evasion on the other hand, the concealing of income and not falsifying any documents, is merely a civil offense, not unlike a traffic violation. In addition, as of January 1st 2000 any cash transaction over €15,000 with a customer that didn’t have an ongoing relationship with the bank or was wired to the bank from offshore, needed to register their identity with the bank. These changes were brought about as the result of a European Council Directive to prevent the financial system from being used to launder money.  As a result of these amendments to the banking law, the European Commission withdrew its complaints against the Republic of Austria.                                           

The story regarding Switzerland and Liechtenstein is slightly rockier. German federal investigators paid €5 million to a former bank employee of the Liechtenstein Große Treuhand bank (LGT). The employee, Heinrich Kieber, is alleged to have removed the secret bank data from the LGT bank, thus kicking off a row over tax evasion in the EU. Before the dust settled, U.S. investigators charged Switzerland’s UBS bank for deliberately encouraging American citizens to engage in tax fraud activities. The Swiss have always attracted a certain limelight regarding chocolate, cheese, cuckoo clocks, and banking secrecy – a financial business model that attracts an estimated $1.84 trillion in assets of which about €450 billion belong to private customers. In Switzerland, the hoopla began when the bank was found to have offered tax evasion tactics to Americans that were invented by auditors at KPMG, who only managed to avoid criminal prosecution when they paid up $456 million in fines and penalties. The UBS bank was ordered to pay $780 million, and then they did the unthinkable, they handed over the names of 300 customers after the U.S. government produced strong evidence of tax evasion. The U.S. authorities are still seeking the names of an estimated 52,000 Americans with secretive UBS accounts.

According to mainstream press, these events are what have sparked the U.S., British, and German push for an ‘end’ of banking secrecy and prompted bankers from Switzerland, Austria, Luxembourg, and Liechtenstein to hoist their skirts and run for cover. Baa-humbug!

Firstly, tax evasion is not a criminal offense in any of these countries currently being hounded for their bank secrecy laws and for the most part bank secrecy is federal and constitutional law in these countries.

Basically the international community has pushed these European tax havens to accept Article 26 of the OECD Model Tax Convention on Income and Capital. Article 26 creates an obligation to exchange information, but the contracting state is not at liberty to engage on a “fishing expedition”. The contracting country must firstly show evidence of tax evasion, can only request information that is relevant to the tax affairs of a given taxpayer, must demonstrate the foreseeable relevance of the requested information, and prove to have pursued all domestic means to access such information. As of yet, it is unclear just how much tax evasion evidence even need be presented.

Austria, Belgium, Luxembourg, and Switzerland were opposed to the current version of Article 26, last updated on July 17, 2008, but since March 2009 each of these countries has notified the OECD that they are withdrawing their reservation to Article 26. They now believe that bank secrecy is not incompatible with the requirements of Article 26. And with little wonder, because the particulars of Article 26 are easily circumvented with a legal phenomenon called ‘Hidden Treuhand’.

Hidden Treuhand is a customary practice in Austria, Switzerland, Luxembourg, Liechtenstein, and even Germany. Due to globalization, it has transcended its national borders to impact industry, commerce, and banking worldwide. It is key to creating shell companies, foundations, and bank accounts where the real owner identity is hidden and cannot be exposed by any legal means. A Hidden Treuhand creates conditions where a lawyer conducts the duties required of him on behalf and in the interest of the client, but all business actions appear to be in the name of the lawyer. The real beneficial owner remains unknown. This construct can be liberally applied to stock in corporations, foundations, real estate, patent and copyrights, financial instruments such as derivatives and bonds, and of course, cash.

In 2000, some aspects of banking secrecy came to an end, but the Hidden Treuhand is frequently used to close the gap that those transparency laws were supposed to fill. In essence, the Hidden Treuhand is somewhat like a hidden trust, but legally it and the environment in which it functions, can achieve far more than is presently realized. Hidden Treuhand hides the beneficial owner of any asset and that includes bank accounts. Hidden Treuhand, when combined with banking secrecy, hides profits beyond the reach of tax investigations and governments. It’s like missile shield for money – nothing gets past this protective barrier.

Article 26 of the OECD MODEL TAX CONVENTION ON INCOME AND CAPITAL concerns the exchange of information between Contracting States. Hidden Treuhand is the creation of customary practice, but it is not regulated and there are no laws in existence that could be equated as regulatory. The following Hidden Treuhand provisions are quoted from law books referring to customary practice and illustrate how each of the OECD provisions is rendered mute. Compare the inherent capabilities of Hidden Treuhand with text of Article 26 where it states that none of the following provisions shall be construed so as to impose the obligation to:

OECD: to carry out administrative measures at variance with the laws and administrative practice of that or of the other Contracting State;

Hidden Treuhand: “What makes a Treuhand contract so special and unique under Austrian Law is that there is no special law regulating Treuhand contracts…there is no regulation of Treuhand contracts under Austrian Civil Law, and there are not any laws that could be equated as regulatory.” 

OECD: to supply information which is not obtainable under the laws or in the normal course of the administration of that or of the other Contracting State;

Hidden Treuhand: “It is not to be expressed that any direct legal relationship or connection exists between the businessmen and the lawyer. In fact, the lawyer would be guilty of misconduct should the lawyer reveal that a legal relationship (power of attorney) exists between himself and the client”.  

OECD: to supply information which would disclose any trade, business, industrial commercial or professional secret or trade process, or information the disclosure of which would be contrary to public policy (ordre public).

Hidden Treuhand: “When using a Hidden Treuhand, trustees are referred to as a Straw Man. A trustee functions like a Straw Man and acts in the name of the client who remains undeclared in the background. The relationship between the businessman and the lawyer is secret, which often includes even knowledge of a ‘power of attorney’ existing between the lawyer and the businessman”

When it comes to Hidden Treuhand, lawyers exploit attorney client privilege and claim it their legal duty to deny information and to keep all matters pertaining to their client confidential. No one, no court or authority, no government, can force an attorney to reveal any secrets concerning his client. And what of banking or bank accounts?  

The EU and international money laundering laws have striven to eliminate any criminal elements from the banking system, but Hidden Treuhand works within the law and in the banking system. Hidden Treuhand bank accounts are not made public because only the trustee is entitled to use the account, and there is no legal relationship between the client and the bank account. A lawyer lets the bank know that an account is a trust account, but does not have to disclose the name of the beneficiary. A Treuhand account means a banking relationship exists between the bank and the trustee and the bank is not entitled to know whom the lawyer represents anymore than anyone else.

“According to leading banks, designating an account as a Treuhand account alters nothing. The true account beneficiary remains a secret because only the trustee is authorized to use the account and there is no legal relationship between the client and the ‘special account’. The clients’ identity is not exposed when making bank transactions because it is the trustee’s responsibility to make money transfers from this ‘special lawyer trust account’ (Anderkonto)”.

As result of the crackdown against tax havens, more clients will have to resort to Hidden Treuhand and lawyers services. Already Liechtenstein has sold its Treuhand services to a separate company, quite possible even to itself via Hidden Treuhand. Their business model will no doubt resemble the Austrian one where the registration of foundations and Hidden Treuhand is separate from bank institutions. If foreign tax authorities manage the first hurdle and can provide strong evidence of tax evasion and seek further information regarding bank accounts they will firstly have to petition the cooperation of the Ministry of Finance. The ministry will ask the banks, but to what end? The bank cannot tell them what they do not know.  

So much for the grandiose announcement heralding the end of bank secrecy and tax havens!

Many large-cap US corporations have headquarters or subsidiaries based in tax havens. For example: McDonalds recently moved to Switzerland. Moreover, it is possible for a hedge fund to own an offshore bank. For example: the highly secretive hedge fund Cerberus owns Bawag, an Austrian bank, as well as a majority shareholder stake in Chrysler and GMAC. If questioned, would Bawag reveal information regarding any accounts held by a stakeholder of Cerberus?

Just how big is the offshore banking industry? The OECD estimates that assets held by the offshore banking industry might be as high as $11.5 trillion. Little wonder U.S. banks are having trouble lending money and no big surprise the European legal community claims to have no objection to Article 26.

Bank secrecy is alive and well! No question mark necessary. It just got a bit more expensive and devious. It is high time someone made the announcement: we have officially entered the ‘Age of Stealth Wealth’!

To learn more about Hidden Treuhand and what role it is playing in the financial crisis, bank secrecy, bailouts, globalization, the privatization of Iraq, and your financial security, please read: Hidden Treuhand: How Corporations and Individuals Hide Assets and Money

Available direct from publisher and Amazon and Barnes and Noble

Boeing doesn’t know yet how long 787 fix will take
By Dominic Gates
Seattle Times aerospace reporter
When might the 787 Dreamliner fly and what’s the cost to fix it and get it in the air?
That was the big question dominating an early-morning earnings teleconference Wednesday between Boeing CEO Jim McNerney and Wall Street analysts, who expressed concern about the new jet program’s profitability.
McNerney said Boeing is still assessing how long it will take to fix the structural flaw that has grounded the jet. The company won’t have a new schedule or an estimate of the added costs until “later this quarter,” he said.
That extends the time frame for providing answers. A month ago, Boeing said it hoped to have a new schedule for first flight and delivery within “several weeks.”
“We are working through this matter as quickly as we can but will not sacrifice quality for expediency on such an important effort,” McNerney said.
The focus on the 787 meant that Boeing’s buoyant quarterly earnings got scant attention during the conference call.
Its second-quarter profit rose 17 percent to just shy of $1 billion on revenue of $17 billion.
Boeing has about $5 billion in cash on hand, and profit margins were healthy at about 10 percent in both the defense and commercial-airplane divisions. In the midst of a steep and broad economic downturn, it maintained its financial forecast for the year.
And despite more than 70 jet-order deferrals in the last three months, and the announced cut in 777 output next year, McNerney said he expects to hold 737 production steady in Renton.
But the good news was overshadowed by worries over the 787. McNerney offered what reassurance he could.
He said Boeing has identified and analyzed the structural problem at the wing-to-body join, duplicated it on a computer model and selected a preferred solution.
The hangup, he said, is that it’s difficult to implement the fix — especially on those planes already built — because of the inaccessibility of the place inside the wing where the modification has to be made.
In addition, he said, Boeing engineers are using “an abundance of caution” to ensure other stress issues are not created by the modification.
A Seattle Times story published Wednesday before the earnings release cited two engineers who identified the problem as delamination of the composite-plastic material at a stress point at the end of the long rods, called stringers, used to stiffen each wing.
The engineers estimated that the fix could delay first flight four to six months even if the fix works, potentially pushing first flight into 2010.
When asked directly about that prediction during the conference call, McNerney stuck to his answer that no new schedule is yet available.
The engineers cited in the Times story described the Boeing fix as a redesign at the wing-to-body join that involves only a handful of additional parts at the end of each stringer, but is nevertheless complex to implement.
McNerney emphasized that the problem is limited to the join and that the whole wing doesn’t need a redesign.
“There is nothing we have learned to lead us to believe that this is anything but a local issue, which can be addressed with a local fix,” McNerney said.
Boeing also punted on the financial impact of the new 787 delay, saying the answer cannot be known until the new plan is determined.
On the earnings call, Barclays Capital analyst Joe Campbell asked Chief Financial Officer James Bell the question in plain English:
“Are you sure that you’re not losing money on this thing?”
The concern is that Boeing, despite the huge order book for 850 Dreamliners, may not be able to make enough money on each plane to recover over time all the added costs piling up: the extra research and development needed to solve the current problems, the late penalties that will have to be paid to customers and suppliers, and the cost of holding all the expensive inventory for months longer without any income.
Bell disclosed that Boeing has in its inventory almost $8 billion worth of 787 structures work — completed and partially built airplanes — for which it can receive no income until the jets are delivered to customers. He said this 787 work-in-progress inventory is growing at a rate of $800 million per quarter.
In response to Campbell, Bell conceded that the new 787 delay “puts pressure on the profitability of this program.”
“We’ve always been concerned with the cumulative impact of the schedule delays and the pressure it puts on cost,” Bell said.
“We also have been concerned with the delays to our customers and how that converts to penalties or the settlements we have to work through with them.”
But Bell said Boeing expects to create efficiencies over the expected long production run of the 787 that will reduce costs and increase profit per plane to cover all the extra expenses.
“We still believe the program to be profitable,” Bell said.
In an interview later, Campbell said that in rough numbers, using the figures released Wednesday, Boeing will have spent up to $13 billion on inventory buildup by the time it starts delivering the 787s. It has maybe an additional $8 billion to $10 billion sunk into research and development, and it’s on the hook for a few billion dollars more in customer and supplier penalties.
Campbell estimates that the overrun on costs attributable to the delays up until now is around $6 billion.
But that doesn’t include the additional costs being incurred due to the wing-to-body flaw.
Dominic Gates: 206-464-2963 or dgates@seattletimes.com

Pay no attention to the man behind the curtain….  Boeing wants you to only read and believe their corporate blogs.  Got that?  The all and powerful Boeing has spoken.  –GFS

P.S.  Please look at these documents and see how serious Boeing has been about following “securities laws and regulations that dictate how we disclose significant events.”

 Link:  https://gflorencescott.wordpress.com/2009/07/16/boeing-sued-class-action-for-violations-of-federal-securities-laws/ 

 

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Randy’s Journal, Boeing VP

Heard it through the grapevine

Link to Boeing Corporate Blog Site(S):

http://boeingblogs.com/randy/archives/2009/04/heard_it_through_the_grapevine.html

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As we get closer to the first flight of the 787 Dreamliner, clearly there’s going to be more and more focus on day-to-day, if not minute-to-minute progress. It’s the first new airplane program where we’ve seen the full effects of “new media” or “social media” coverage.

Forums and sites are proliferating – ranging from fan and hobbyist pages to journalist blogs and everything in between – chronicling even the most obscure details gleaned from “sources.”

Web sites and blogs focused on commercial aviation are nothing new. We’ve been discussing commercial aviation through this blog for more than four years now. There are many experienced industry writers, journalists, and analysts who provide pertinent commentary through Web sites and other media. They add to the discourse and make the industry all the more interesting and exciting.

The challenge is distinguishing those sources and pages from the various blogs, Twitters and other sites which sometimes position themselves as authoritative – but really are not.

Even the most informed outsiders frequently lack comprehensive and direct knowledge of what’s happening at Boeing – including about our development programs, the 787 and 747-8.

Unfortunately, the seemingly insatiable appetite for any information about those programs has given rise to Web postings and social media sites that distribute rumors or details without ample – or sometimes any – of the context that would aid understanding of what’s really going on. Some of these sites use official sounding titles and designs in an attempt to enhance their credibility.

We’ve seen many examples of “exclusive” postings claiming to have just heard certain information from “sources.” These reports often claim to have inside information about our production plans or progress, orders, deliveries, cancellations, or development program milestones – that often turn out to be incorrect.

Airplane development programs are inherently complicated. What may seem like a major issue today is often fully resolved by tomorrow. Without the context that often can come only from a comprehensive program or company view, incorrect or incomplete information can be circulated as conclusion and fact when it is not. That helps nobody.

That’s why Boeing strives to communicate to the public when we’ve analyzed our data and reached truly informed conclusions, so we can provide definitive explanations of what’s happening. By the way, we’re also governed by securities laws and regulations that dictate how we disclose significant events.

So a bit of a “buyer beware” is in order. Shop carefully when it comes to the information you consume on the Web. Especially when that information has not come from a truly authoritative source.

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Andrea Jame’s Seattle PI blog post on this topic and reader comments:

http://blog.seattlepi.com/aerospace/archives/167004.asp

Boeing hands out layoff notices, most of them in defense

Link to Seattle Post Intelligencer:  http://blog.seattlepi.com/aerospace/archives/173941.asp

Chicago-based The Boeing Co. on Friday plans to issue about 600 layoff notices to warn employees about job cuts effective Sept. 18.

The 600 notices include about 100 in Puget Sound area. Just 80 of the notices are in Boeing’s commercial airplanes division and most of those are in Puget Sound.

The numbers indicate that Boeing’s defense unit will be harder hit.

The layoffs are part of Boeing’s plan to eliminate 10,000 positions this year. Earlier this week, Boeing indicated that it would lay off 1,000 people in its defense unit. It’s still not clear whether those 1,000 are in addition to, or part of, the 10,000 previously announced cuts.

Boeing is in a legal “quiet period” in advance of its earnings announcement next Wednesday.

Previously:

 

Posted by Andrea James at July 17, 2009 5:00 a.m.