Sunday, November 04, 2012

Britain's tax offices, owned offhore, may soon be owned by bankers

In 2002 the British satirical investigative newspaper Private Eye exposed one of the British government's most outrageously ridiculous offshore scandals when it reported that its tax authorities had sold off 650 of their offices to a company called Mapeley Steps Ltd., a company owned in Bermuda, and leased them back for 20 years.

"An unhappy ending was always on the cards," the newspaper reported. And, as usual, they were right. The Mapeley Group is now owned by a US private equity firm, Fortress, headquartered in the tax haven of Guernsey. Now private equity firms make a lot of money for their owners - and note carefully that does not mean they make a lot of money for their foolish investors (read this analysis of the industry and weep, if you can, for the folly of gullible investors.)

Back to Private Eye:
"Fortress was soon exploiting its portfolio of tax offices and government-backed income as security for more ill-fated property speculation. Lo and behold, some of these have been takien into administration and only the taxpayer has kept Mapeley afloat."
The company has now revealed a £103m loss and the directors admit that there are material uncertainties as to the group as a going concern.
"The taxman's landlord, in other words, is on the brink. If Mapeley does go under, Britain's tax offices will become the property of its bankers."
No further commentary needed.

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