Friday, 19 December 2014

Seychelles Firm Implicated In AsiaUniversalBank Money Laundering Case Is Up For Another Laundering Scandal

19/12/14 09:15, Bishkek – news agency, 

Following the takeover of AsiaUniversalBank (AUB) by the Kyrgyz Interim Government in April 2010 an investigation was launched into the money laundering and balance sheet fixing schemes of the bank. 
The Kyrgyz Republic's Attorney General's Office is still mulling over tons of corporate documents and payment orders of the AUB multi-billion dollar payment flow.  Some episodes already resulted in criminal convictions: Michael Nadel, the main owner of AUB, was convicted on 22nd October 2014 by Pervomaisky Court of Bishkek for embezzling millions from AUB and dressing up its accounts using offshore companies, to hide the embezzlement.
In 2011, long before the criminal sentence was given, the laundering and embezzlement episodes were subject to a public investigation by Global Witness, an NGO covering financial crime and related themes.
In its report titled «Grave Secrecy» ( Global Witness revealed that many offshore companies used for dubious financial transactions in AUB in fact were administered by a small handful of offshore corporate service providers.  Among those named was a Seychelles-licensed firm, Apollo Business Solutions (Pty), Ltd., part of a large offshore services group with Russian roots - Apollo International (  Its main marketing and sales offices are in Kiev and Moscow.
It was reported that some of the offshore companies serviced by Apollo were supplied with nominee owners and directors who in fact had no idea their passports were used by the offshore incorporators.  One extreme case cited by Global Witness was that a corporate resolution was 'signed' in Apollo's London office by a man who died three years before that.
Being a large contributor to the Seychelles offshore industry Apollo escaped sanctions by the Seychelles regulators and continued business as usual.
This year, however, a few more criminal episodes happened involving Apollo International, showing that old habits die hard when it comes to the offshore industry.
In April 2014 the US FBI arrested a well-known Ukrainian businessman Mr. Dmitry Firtash in Vienna, Austria for allegedly paying millions of dollars in bribes to Indian officials for mineral rights.  It was then revealed ( that one of the firms which supplied offshore companies implicated in the FBI investigation was Apollo Business Solutions - the same company mentioned by Global Witness.
It was later revealed (,%202014/soc1_r4million_seized.html) that the very same Apollo Business Solutions certified corporate documents for a bank account used by a Russian cyber-gang in the Seychelles.  The account was frozen by the Seychelles Financial Intelligence Unit.
Just very recently news emerged from the Ukraine that Apollo got yet again into a criminal scandal.  This time it was theft of shares in a Ukrainian agricultural enterprise 'Chumaki' which was accomplished by their re-registration in the name of a Seychelles firm incorporated by Apollo.  The re-registration was on the basis of fake papers where signatures of the shares owners were forged.  As it transpired from copies of papers obtained in the course of Ukrainian police investigation, the Seychelles company used for the crime had a director whom neither the Police, nor the victim's lawyers are now able to locate.  Very probably, this is another case of someone's passport used by offshore crooks to make the company truly 'anonymous'.
Ainagul Moldobaeva

Tuesday, 16 December 2014

The Lame Duck Minister!

Seychelles Agrees Tax Policy Focus With IMF
Over the three-year term of the newly-agreed USD17.8m Extended Fund Facility from the International Monetary Fund (IMF), the Seychelles' fiscal policy framework will be dictated by the Government's target of reducing public debt below 50 percent (from 65 percent) of gross domestic product (GDP) by 2018.

The IMF reminded the Seychelles Government that "fiscal policy faces negative pressures, as revenue and grants have been falling as a proportion of GDP, and current spending has been rising in the face of pent up spending demands." The IMF said the Government will need to "carry out wide-ranging structural reforms necessary to support improvement in macroeconomic conditions, lock-in [fiscal] stabilization, and reduce the country's vulnerabilities."

The IMF said that, although the Government's 2013 fiscal position was on-budget, tax revenue pressures have emerged. Business and income tax revenues were weaker than expected, offset to some degree by stronger-than-projected non-tax revenues. It said that attaining the primary surplus target for 2014 (four percent of GDP) "remains feasible and appropriate."

The IMF noted that after considerable reform over the last five years – including the introduction of a value-added tax regime and an overhaul of income and business taxation – there is little space for substantial reform to expand the tax base. At over 30 percent, Seychelles' revenue-to-GDP ratio remains relatively high, and the IMF therefore recommended "reforms to tax administration and increased compliance... to bolster revenue efforts and ensure the availability of resources for investment and other priority spending."

Authorities in the Seychelles agreed to streamline exemptions, adjust specific excise taxes, improve audit capabilities, and strengthen tax compliance, in particular with regard to international tax matters.
Transfer pricing is one area in which the Government hopes to make significant headway. It was noted that the hotel industry "tends to pay little in business taxes, although this in part reflects a legacy of generous past tax concessions."
Seychelles Agrees Tax Policy Focus With IMF

Monday, 15 December 2014

Seychelles: Restructuring On the Cards for BMIO Bank, Announces Central Bank

Victoria — The Bank of Muscat International Offshore (BMIO) in Seychelles is facing re-structuring by the Central Bank of Seychelles (CBS).
The reserve bank took control of the locally-registered BMIO in November following the breakdown of the latter's foreign correspondent banking relationship the month before, and announced the news of BMIO's re-organisation in a press statement issued on Friday.
"CBS has throughout been working closely with the Financial Intelligence Unit (FIU) in an attempt to address the issues faced by BMIO," read the statement. "Following negotiations, CBS has been successful in re-establishing correspondent banking relationship for BMIO which has allowed for some transfers to be effected thus far."
BMIO's lack of banking representatives overseas had left the bank unable to process outward foreign currency transfers for its clientele, with clients abroad unable to perform transfers or deposits.
CBS goes on to say that the restructuring of BMIO under Schedule 4 of the Financial Institutions Act 2004 is necessary "in light of tighter requirements on risk management internationally."
"During the reorganisation, CBS will continue to have full management control over BMIO," the statement added.
CBS did not elaborate on what the re-structuring would entail or when they expected the bank to resume its normal operations.
Under Schedule 4 of the Act, the reserve bank must as soon as possible draw up a reorganisation plan for the local financial institution, while still taking the interests of all persons concerned with the financial institution into account at all times.
According to the Act, CBS as the reorganizing agent may also "provide for the removal of any director, manager, officer, employee or agent of the financial institution who in the opinion of the Central Bank was responsible for or contributed to the circumstances which led to the seizure of the institution".
BMI Offshore was registered in Seychelles in July 2008 as a joint venture between BMI Bank in Bahrain and Seychelles-based bank Nouvobanq, each with 50 percent shareholdings.
The bank is based in the 'Capital City' building on Independence Avenue in central Victoria, the capital of the 115-island archipelago.
In a previous statement, the reserve bank reassured the bank's clients that the issue was "purely of an operational nature", adding that BMIO was still financially sound and "not threatened" by its lack of correspondent bank.

Saturday, 13 December 2014

The Tourism Shambles

Seychelles has priced itself out of the global tourism market mainly due to excessive government taxes levied on persons and businesses. Taxes used for shoring up the Social Security and the extravagant pension schemes. Millions of rupees wasted on official government travel, liked going to watch the Bahrain Grand Prix, stupid stuff that has turned Seychelles into one of the most expensive places to spend your vacation.

But that is not all.Air Seychelles was run into the ground then sold to the Arabs after years of bankruptcy and carrying not much more than the Air Seychelles logo painted on its tail. The Arabs now run it like a real airline by hopping from node to node and trying to fill their planes with a rapid dwindling population of tourists and cargo headed for Seychelles.

Outward appearances not withstanding including those tall and glitzy empty buildings, the UAE is still a lopsided one primary raw material economy. It's survival depends on the vagaries on the global oil prices mechanism. But they are not alone. Seychelles is heavily dependent on tourism, an industry of sorts, but one that is subjected to fluctuations in the vacation habits of workers from Europe and North America.

In that sense both the UAE and Seychelles are third world economies, surfing the business cycle. One day it's champagne and caviar and the next its tap water and mouldy bread. The Seychelles tourism business is like selling jogging shoes to quadruple amputees. It is dead in the water.

These idiots sent their own bird to the Dodo extinction department. It was their only chance to even dream of resuscitation their long dead tourist economy. They might want to try drug tourism like those Amsterdam pot cafes where junkies from all over the world gather to shoot up and chase the dragon. The first camel rides will be flattened to the ground. They will have to scrape it off the pavement like an elephant trying to fuck a mouse.

Keep waiting for the empty flights!

Seychelles Reality Today

IMF cuts Seychelles 2014 economic growth to 2.8 percent

Sat Dec 13, 2014 6:32am GMT
VICTORIA Dec 13 (Reuters) - The International Monetary Fund said Seychelles' economy will grow at 2.8 percent this year, lower than its initial forecast of 3.7 percent, due to weaker demand for the country's main exports.
The Indian Ocean archipelago relies on exports of canned tuna and its tourism business for hard currency earnings.
A surge in imports, driven by better incomes and access to credit, had put further pressure on the exchange rate, which weakened 11 percent between August and October this year, the IMF said in a statement seen by Reuters on Saturday.
It said the central bank's decision to tighten the reserve money target for the fourth quarter will dampen the inflationary effects of the currency's depreciation.
The IMF approved the disbursement of $2.4 million to Seychelles, part of a an extended credit facility in June this year, it said in the statement.
(Writing by Duncan Miriri; Editing by Simon Cameron-Moore)

Reuters Africa

IMF Completes First Review Under Extended Fund Facility Arrangement for Seychelles, and Approves US$2.4 Million Disbursement

WASHINGTON, 12 December 2014 / PRN Africa / — The Executive Board of the International Monetary Fund (IMF) today completed the first review under the Extended Fund Facility arrangement (EFF) for Seychelles. The completion of the review enables a disbursement of SDR 1.635 million (about US$2.4 million), bringing total disbursements under the arrangement to SDR 3.27 million (about US$4.8 million). The Executive Board's decision was taken without a meeting. The EFF was approved in June 2014 (see Press Release No. 14/262) for SDR 11.445 million (about US$ 16.8 million, or 105 percent of Seychelles' quota), and follows the expiration of the previous EFF in December 2013.
Program implementation and economic fundamentals continue to be strong, although the external position weakened in mid-2014. At the first test date of end-June 2014, all performance criteria were met; based on preliminary data, all third quarter indicative targets were also achieved. The structural agenda remains broadly on track, although there were some technical delays, notably with respect to amending tax legislation to make it consistent with international transparency norms. Projected growth for 2014 has been revised down to 2.8 percent from 3.7 percent, due to weaker demand for Seychelles' two main exports—tourism and canned tuna. At the same time, strong growth in personal earnings and private sector credit have fueled a surge in imports, putting further pressure on the balance of payments. As a result, the exchange rate depreciated by 11 percent in nominal effective terms from early August to late-October.
The authorities have taken appropriate monetary and fiscal policy actions to address balance of payment pressures. The Central Bank's decision to tighten the reserve money target for the fourth quarter of 2014 by 7 percent and maintain this stance into 2015 is a strong response to the demand and external pressures, which will serve to dampen any inflationary second-round effects following the depreciation. The fiscal targets for 2014 and 2015 were also tightened to support the restoration of external balance and maintain progress toward the target of reducing the debt-to-GDP ratio below 50 percent by 2018. The flexible exchange rate regime continues to serve the country well, and can act as an important safety valve in helping to manage the pressures and restore external equilibrium. Steadfast implementation of the authorities' structural agenda should continue to lay the groundwork to promote inclusive growth and reduce risks. This agenda focuses on ensuring transparency and efficiency in the use of public resources, strengthening the governance of state-owned enterprises, and enhancing the environment for private sector development.

SOURCE International Monetary Fund (IMF)






Wednesday, 10 December 2014

Settle your six-figure US tax bill

Boris Johnson should settle a six-figure tax bill in the US, the American ambassador indicated yesterday.
The London Mayor, who was born in New York and has dual citizenship, revealed last month that he is being pursued by the US tax authorities over profits made on the sale of a home in London.
American citizens are required to pay taxes on income over a certain level, even if the money is already taxed abroad.
Mr Johnson described the demand as ‘incredible’, and suggested he would not pay.
But US Ambassador Matthew Barzun indicated that Mr Johnson should settle up.
Speaking to journalists in Westminster, he refused to be drawn on the details of the London Mayor’s case.
But he said: ‘We have our rules and we expect people to play by them.
'If you get the benefits of being an American citizen you pay your fair share in taxes.’
The disputed tax bill is believed to relate to the sale of Mr Johnson’s first home in London.
He is reported to have bought the property in Islington, north London, for £470,000 in 1999. It was sold a decade later for £1.2million.
His salary as Mayor is £144,000 and he is paid £250,000 for a newspaper column.
The US embassy is also involved in a long-running row with the capital’s authorities over more than £8million in congestion charge fees run up by diplomats, which it refuses to pay.
In July last year, ahead of Mr Barzun’s arrival, Mr Johnson praised his diplomatic abilities, then added: ‘I do hope he’ll put those skills to good use in finding the more than £6million owed by US diplomats to Londoners in unpaid C-charge fines.’
And ahead of a state dinner in honour of Barack Obama in London in May 2011, he said: ‘Maybe when President Obama’s hors d’oeuvre plate is whisked away he will find a bill for £5.5m.’

Tuesday, 9 December 2014

Europeans give up holiday travel as austerity bites

Fewer Europeans are planning to go away for a summer holiday as economic austerity bites, a new study shows, with levels of foreign vacation travel at their lowest for eight years.

No more than 54 percent of Europeans are planning to get away for summer holiday this year, according to the Ipsos-Europ Assistance "holiday barometer" published Thursday.
Europ Assistance Group CEO Martin Vial said there was "a clear correlation between the intensity of the slump and holiday intentions".

Unsurprisingly the countries with the highest unemployment rates were the worst hit.
"The scope of the crisis in Spain and Italy is particularly visible in departure plans," the report said, with fewer than one in two Spaniards planning to leave on holiday this summer and little more than half of Italians.
Due to "less tense" economic and social situations the departure plans for Germans and Austrians had stabilised, according to the study.

For the first time since the economic crisis began, the French are particularly affected this year, it said.
While 62 percent of them say they want to leave on holiday this year, this is still eight points down on last year and the lowest rate since 2005.

At least the stay-at-home French can comfort themselves on remaining in the leading destination chosen by Europeans.

The country is set this year to welcome 18 percent of European tourists, the study says, followed closely by Italy with Spain, on 14 percent, in third place.

The Internet and social networks are being used more than ever for vacation preparations, with the British holidaymakers most active on the Internet, followed by the Belgians, French and Germans.
The British have also retained their enthusiasm for foreign travel, being the only country studied where the intentions to leave on a summer holiday are going up this year, from 51 percent to 56 percent.
Ipsos conducted the study talking to a total of 4,048 Europeans from Austria, Belgium, Britain, France, Germany, Italy and Spain.

Source AFP