Thursday, July 08, 2010

Flip this house: offshore and private equity

Recently we published an article in Tax Justice Focus highlighting an IMF report that explained one of the ways that offshore has contributed to the latest financial and economic crisis, as a result of offshore tax tricks such as those used by private equity firms to leverage up with debt, take tax deductions onshore and realise profits offshore.

Well, our attention has just been drawn to two excellent articles in the New York Times which look at the gory details of two such deals, one by Gretchen Morgenson about a Greek mobile phone company, and another by Julie Cresswell about the Simmons Mattress Company. Both were excellent, dynamic companies -- and they were driven to the ground by abusive owners.

Read on. Just look at the cynicism of all this. If this kind of stuff is legal, it's a wonder why it is.


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