The Center for Public Integrity

Editor's note, May 23 —A local Virginia prosecutor is examining whether Gov. Robert McDonnell violated state disclosure laws by failing to report a 2011 gift from a campaign donor. The investigation, first reported Wednesday by the Richmond Times-Dispatch, began in November at the request of Attorney General Ken Cuccinelli 

A series of revelations and stinging media reports about Virginia Gov. Robert McDonnell’s relationship with a corporate executive is bringing new attention to the state’s forgiving accountability laws — a subject highlighted last year by the State Integrity Investigation.

The root of the uproar is a $15,000 catering tab for the wedding of McDonnell’s daughter back in 2011, quietly paid by Jonnie Williams Sr., the CEO of Star Scientific, a Glen Allen, Va.-based dietary supplement company. Now the news, first reported in late March by the Washington Post, is dominating conversation in the state’s political circles and raising questions about Virginia’s liberal allowances for gifts to politicians: there is no limit.

Gov. Nathan Deal brought Georgia in line with nearly every other state in the nation Monday by signing into law the state’s first restrictions on lobbyists’ gifts to lawmakers. Deal’s action puts in place the first major piece of ethics reform Georgia has passed in decades.

Until now, lobbyists in the Peach State had been free to lavish legislators with gifts and junkets of any size. But starting next year, they’ll be forbidden from spending more than $75 per gift.

The previous lack of gift rules was one of many reasons why Georgia ranked dead last a year ago in the State Integrity Investigation, a data-driven ranking of state government accountability and transparency carried out by the Center for Public Integrity, Global Integrity and Public Radio International. In addition to its overall grade of F, Georgia received failing grades in the specific categories of lobbying disclosure and legislative accountability.

“Our success as leaders of Georgia depends heavily on the public’s ability to trust us,” Deal said in a statement after signing the gift ban along with a second bill that deals with campaign finance reporting, primarily at the local level. “Together, these bills constitute a major step in improving ethics, trust and transparency in our state.”

While advocates of tighter ethics laws hailed the legislation as a step in the right direction, the gift cap bill contains several exceptions they believe substantially weaken the provision.

“It’s like you’re starving for a meal and somebody gave you a saltine cracker,” said William Perry, executive director of Common Cause Georgia, an advocacy group.

Florida Gov. Rick Scott signed a package of reform bills Wednesday night, bringing final approval for the first major overhaul of the state’s ethics laws in more than three decades. The two bills give significant new powers to the state’s ethics commission, extend a ban on lobbying for lawmakers after they leave office and rework the state’s campaign finance limits.

The new ethics legislation will address at least some of the weaknesses responsible for Florida’s overall grade of C- from the State Integrity Investigation, a state-by-state ranking of ethics and accountability released last year by the Center for Public Integrity, Global Integrity and Public Radio International. In the specific category of ethics enforcement, the Sunshine State had received an F.

The measures, which the legislature passed last week, had been top priorities for Senate President Don Gaetz and House Speaker Will Weatherford, both Republicans. Watchdog groups followed the bills’ passage closely and largely praised the ethics bill.

“There’s been a 36 year drought of meaningful ethics reform legislation going anywhere in Florida,” said Dan Krassner, executive director of Integrity Florida, a statewide watchdog group. “The fact that our state leaders prioritized ethics reform and dedicated time and resources to serious debate and policy improvements on the issues is historic.”

In the summer of 2009, Jennifer Sharkey was moving in select company. As a Manhattan-based vice president at JPMorgan Chase & Co.’s Private Wealth Management group, she juggled relationships with 75 “high net worth” clients with assets totaling more than half a billion dollars.

Things changed for her, she claims, after she raised doubts about a “suspect” foreign client who had millions stashed in various accounts at the bank.

The client was making questionable cash transfers and concealing who actually owned certain accounts, according to a lawsuit Sharkey is pursuing in federal court in Manhattan. She also found evidence, her suit claims, that the client had falsified financial statements for one of his companies and that he’d been involved in the “unexplained disappearance” of millions of dollars in merchandise in another venture.

After she warned high-level bank officials that the client might be involved in fraud and money laundering, her suit claims, JPMorgan moved to silence her — pressuring her to stop raising questions about the client, assigning her other clients to junior colleagues and, finally, firing her.

“I was just doing my job,” Sharkey said in an interview with the International Consortium of Investigative Journalists (ICIJ). But for the bank, she said, “it was more important to keep this client than to do the right thing.”

STOCKHOLM — Bankrupt Swedish real estate tycoon Hans Thulin had as much as $17 million sheltered offshore at a time when the Swedish government was pursuing him in court for millions of dollars in unpaid debts, according to secret records obtained by the International Consortium of Investigative Journalists and reviewed by Fokus, Sweden’s leading newsmagazine.

Details of Thulin’s offshore holdings are big news in Sweden because he has been one of the Swedish state’s largest debtors — and because he’s well-remembered in his native country as a lavish collector of art and luxury cars and a symbol of the high-flying, easy-credit ’80s. It was the fall of his commercial property empire that helped signal the beginning of Sweden’s 1990 real estate meltdown.

A government-owned company that had taken over bad debts owed by Thulin sued him in 2007, seeking to force him to repay business loans he’d defaulted on. A trial court imposed a judgment of 150 million Swedish crowns against him in 2009.

By early 2013, the total debt and interest Thulin owed the government had grown to 179 million crowns ($28 million).

Continue reading at ICIJ.

Finnish state-owned postal company Itella has offshore subsidiaries in both Cyprus and the BVI, documents obtained by the International Consortium of Investigative Journalists show.

The revelation comes at a time when the Finnish government promised to be at the frontline of the fight against tax evasion. Since 2011, Finland has explored the possibility of adopting a stricter set of criteria for tax havens, surpassing the standards applied by the Organization for Economic Cooperation and Development.

Itella, part of the National Mail Company, has had four subsidiaries in tax havens over the past five years; three in Cyprus and one in the British Virgin Islands.

In 2008, Itella bought the Russian logistics company NLC International Corporation, which was registered in the BVI with subsidiaries in Cyprus. Internal documents obtained by the ICIJ and MOT/Finnish Broadcasting Company, YLE, show that the transaction was made through the offshore firm Commonwealth Trust Limited.

The director of Itella Logistics in Russia, Vesa Vertanen, said in an interview with Finnish state television that Itella is going to dissolve the company in the BVI by the end of this year and move it to Cyprus.

Cyprus is a known tax haven favored by Russians who want to hold assets offshore.

Continue reading at ICIJ.org.

Michael David Dunn didn’t like the volume of music coming from the SUV parked next to him at a Jacksonville gas station. So he yelled over the bass vibrating from a boxed speaker in the back of a red Dodge Durango and told the men inside to quiet down.

“Kill him,” one of the Durango’s passengers responded, according to Dunn’s account. Dunn, who is white, said one of the young black men in the SUV reached down for a shotgun. Dunn pulled out a 9-millimeter Taurus handgun from his glove box. He fired eight or nine times.

The bullets sliced through the rear passenger door, striking 17-year-old Jordan Davis in the chest and legs. A high school senior with plans to go into the military, Davis died before arriving at the hospital.

While it’s unclear whether Dunn was the aggressor or defending himself with his handgun, shootings like this one on Nov. 23, 2012, now are common in Florida.

Murders by firearms have increased dramatically in the state since 2000, when there were 499 gun murders, according to data from Florida Department of Law Enforcement. Gun murders have since climbed 38 percent — with 691 murders committed with guns in 2011.

Only partial numbers are available for 2012, but from January to June, there were 479 murders in Florida — 358 of them committed with a gun. That’s an 8 percent increase in gun murders compared to the same period in 2011.

Guns are now the weapons of choice in 75 percent of all homicides in Florida. That’s up from 56 percent in 2000.

The rise in gun homicides in Florida comes at a time when the overall murder rate has declined in Florida, and violent crime has dropped statewide.

Current and former students at two more prestigious colleges have reportedly filed federal complaints alleging mistreatment of campus sexual assault victims — the subject of a major investigation by the Center for Public Integrity.  

The New York Times reported that the complaints were filed against Swarthmore College in Pennsylvania and Occidental College in California, alleging violations of the Title IX civil rights law, and in Occidental’s case, the Cleary Act, which established strict rules on reporting of campus crime. Over the past couple years, other elite schools, such as Wesleyan, Yale, Amherst and the University of North Carolina, have been plagued by similar allegations.  

In 2009 and 2010, the Center – in collaboration with NPR – did a series of investigative pieces entitled “Sexual Assault on Campus: A Frustrating Search for Justice.” The series revealed that students found “responsible” for campus sexual assaults often face little or no punishment from school judicial systems, while their victims’ lives are frequently turned upside down.

For me, the Offshore Leaks investigation started in September 2012.

ICIJ's deputy director, Marina Walker Guevara, sent me a list of Greek names they had extracted from the data and some extra clues on the material.

She told me that I had two choices: either travel to a country in Eastern Europe to search the data myself now, or wait until November to get remote help from another colleague. Two months was too long to wait. A few days later I travelled to Eastern Europe.

An ICIJ colleague showed me how to search the millions of records. During the first few hours I was totally frustrated; I had to check different tables with names and codes; I had to cross check numbers, shareholders, sham directors and addresses; and read hundreds of emails. And time was pressing - I couldn't occupy his desktop and office forever. My aim was to track down all of the offshore companies connected with Greeks in the next three days and to be at the airport on time. I still am not sure if I tracked them all.

Back in Greece the crosschecking continued. With the help of another ICIJ colleague in Spain, Mar Cabra, new aspects of the Greek offshore world were revealed. The stories behind the complex moves of the directors and shareholders unraveled slowly, and some of them were expanding outside the country.

"Crocodile Dundee" star Paul Hogan may have settled his tax case with Australian authorities but he is accusing his once-trusted tax adviser of absconding with $34 million he helped Hogan hide in offshore tax havens.

There is already an international warrant out for Philip Egglishaw, the man known as the ''bowler hat Englishman'', who is the alleged mastermind behind Australia's biggest tax evasion scheme.

But now the international fugitive has the Australian actor on his tail, with Hogan's advisers taking legal action in the US alleging Egglishaw, who set up elaborate corporate structures in tax havens to help his clients evade tax, has stolen the entertainer's money.

Continue reading at ICIJ.org.