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Tax Haven America: As IRS crusades against Americans hiding money offshore, Latin American tax cheats flock to U.S. banks

Teams of private bankers working for powerful banks court wealthy people from distant shores with this sales pitch: Move your cash to our country. We will keep it safe and secret.

That was the modus operandi of UBS, the Swiss banking giant that was forced to admit holding billions of dollars in covert accounts for Americans trying to avoid U.S. taxes.

It is also a tactic used by big American banks to solicit deposits from wealthy citizens in Third World countries, according to tax-evasion experts.

Even as the U.S. Internal Revenue Service crusades against Americans using offshore banks to hide money, these tax experts say, the United States itself serves as a massive haven for international tax cheats.

“We’re the biggest tax haven in the world,” says Robert Goulder, editor-in-chief of U.S.-based Tax Notes International. “People joke about the Cayman Islands. The biggest haven is an island, all right. It’s either Manhattan or Great Britain.”

Jack Blum , a former U.S. Senate investigator and an authority on offshore tax shelters, says U.S. bankers “sell tax evasion to citizens of Central America, the Caribbean, all over Latin America.” The U.S. government hasn’t put a stop to it, Blum says, because bankers and politicians don’t want to stop the flow of foreign cash into the United States.

To read the rest of this article, go to iWatchNews.

Michael Hudson is a staff writer at the Center for Public Integrity’s iWatch News and author of The Monster: How A Gang of Predatory Lenders Fleeced America–and Spawn a Global Crisis.

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Michael W. Hudson

Michael W. Hudson

Michael Hudson covers business and finance for the Center. He previously worked as a reporter for the Wall Street Journal and as an investigator for the Center for Responsible Lending. Hudson has also written for Forbes, The Big Money, the New York Times, the Los Angeles Times and Mother Jones. His work has won many honors, including a George Polk Award for magazine reporting, a John Hancock Award for business journalism and accolades from the National Press Club, the White House Correspondents’ Association and the American Bar Association. He edited the award-winning book Merchants of Misery and appeared in the documentary film Maxed Out. His new book, THE MONSTER: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America—and Spawned a Global Crisis, will be published in October by Times Books.