Europeans take on tax shelter

A sign at the entrance of the Liechtenstein

TEXT OF STORY

KAI RYSSDAL: With all apologies to Las Vegas, it's probably more true to say what happens in Lichtenstein does actually stay in Lichtensteiin, or at least it used to. Strict bank secrecy laws have helped make the land-locked European principality a tax haven, but a secret list of account-holders at one bank there has been sold to tax officials in at least two European countries.

And John Dimsdale reports from Washington, the list is getting some attention here as well.


JOHN DIMSDALE: A former employee of Lichtenstein's LGT banks, stole a list of their customers, and then Heinrich Kieber sold the list of German account holders to that country's foreign intelligence agency, reportedly for more than $6 million. Last week, German tax authorities conducted dozens of raids on the homes and offices of possible tax evaders on the list. As a result, the German treasury is likely to recover more than $650 million in lost taxes.

Germany's success prompted British tax authorities to pay some $200,000 for information on the hundred or so wealthy Brits on the list. Now, France, Finland, Canada and the United States all want to know whether any of their citizens are on Kieber's list. He's now hiding in Australia. Ted Truman, the co-author of "Chasing Dirty Money," says this will raise the pressure on tax havens to start sharing more banking information. stole a list of their customers. Then Heinrich Kieber, sold the list of German account holders to that country's foreign intelligence agency, reportedly for more than $6 million.

Last week, German tax authorities conducted dozens of raids on the homes and offices of possible tax evaders on the list. As a result, the German treasury is likely to recover more than $650 million in lost taxes. Germany's success prompted British tax authorities to pay some $200,000 for information on the 100 or so wealthy Brits on the list. Now, France, Finland, Canada and the United States all want to know whether any of their citizens are on Kieber's list. He's now hiding in Australia. Ted Truman, the co-author of "Chasing Dirty Money," says this will raise the pressure on tax havens to start sharing more banking information.

TED TRUMAN: The very fact that this has sort of they've sort of uncovered this practice, which is not a surprise to anybody, may actually be very helpful all the way around in loosening up the tax havens and tightening up the regulation of the exchange of information.

The IRS declined comment on reports the U.S. has paid for the list of American customers of the Lichtenstein bank, buut Michigan Senator, Carl Levin says, he intends to investigate the small country's banking practices. His subcommittee estimates the U.S. Treasury loses as much as a $100 billion dollars a year to offshore tax evasion.

In Washington, I'm John Dimsdale for Marketplace.

About the author

As head of Marketplace’s Washington, D.C. bureau, John Dimsdale provides insightful commentary on the intersection of government and money for the entire Marketplace portfolio.

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