- WASHINGTON, DC - Public Citizen
today called on Treasury Secretary Paul O'Neill to explain evidence indicating
that he helped Enron continue hiding information about its financial condition
and took actions enabling it to funnel potentially billions of dollars
belonging to shareholders and employees into offshore tax havens.
In a letter to O'Neill, Public Citizen President Joan Claybrook said she
is "deeply concerned" about O'Neill's actions. She asked the
secretary to provide detailed information about his communications with
Enron executives and Bush administration officials about the tax havens.
"The secretary owes the public an explanation," Claybrook said.
"His actions have created a tremendous appearance of impropriety.
He has a duty to taxpayers, Enron shareholders and Enron employees to
clarify this matter."
In 1998, the Clinton administration began making moves to crack down on
countries whose lax banking regulations permit U.S. companies to hide money
in offshore tax havens. Clinton threatened strict economic sanctions on
all nations with lax banking regulations, effective July 2001, in an effort
to create a global trend toward increased financial transparency.
But on Feb. 17, 2001, O'Neill announced that the Bush administration was
going to review the matter, effectively delaying it. As a result, Enron
and other companies could continue to hide money in the Cayman Islands
and other offshore accounts. Enron has 874 subsidiaries registered in
the Cayman Islands and other nations with weak bank disclosure laws.
On Nov. 27, 2001, O'Neill's office announced that according to an agreement
with the Cayman Islands, that nation would not have to tighten its banking
laws until 2004. That would give enough time for companies to move their
assets and destroy their records.
O'Neill's efforts must be viewed in the context of the more than $1.1 million
Enron contributed to Bush's presidential campaign and inauguration, Claybrook
wrote. She noted that O'Neill's responsibility is to collect owed taxes
-- not to facilitate tax avoidance -- and that if Enron and other companies
are hiding money in the Cayman Islands, he has an obligation to end that
abuse.
Public Citizen first raised questions about the offshore tax havens in
a report about Enron issued in late December, Blind Faith: How Deregulation
and Enron's Influence Over Government Lotted Billions from Americans.
In the letter, Public Citizen asks O'Neill to answer detailed questions
about his decisions regarding the tax havens; provide a comprehensive
list of his contacts with Enron executives, President Bush, Vice President
Dick Cheney and their staffs about the issue; explain the extent of his
knowledge about tax havens being used by terrorists to hide money; explain
why he took the steps; and more.
-
- http://www.citizen.org/pressroom/release.cfm?ID=1000
|