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Great Grain Robbery: Argentina Charges GM Soy Giants -Aka the 'ABCD Four'- With Huge Tax Evasion in Landmark Suits

Business  (tags: landmark lawsuits, Argentina, tax evasion, hidden profits, world's largest grain traders, GM Soy Giants, ABCD Four, ADM, Bunge, Cargill, Dreyfus, Oxfam, corporate concentration, global food trade, structural flaw, soaring prices, global hunger )

- 2930 days ago -
'ABCD 4' well into criminality. When food commodity prices spiking at record levels 2008/09, reported profits remained incredibly low. Detailed inquiry shows all 4 routed profits thru tax havens, HQs. Global food system & who controls it under scrutiny..


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LucyKaleido ScopeEyes (82)
Thursday June 16, 2011, 8:27 am
Argentina accuses world's largest grain traders of huge tax evasion - Grain traders ADM, Bunge, Cargill and Dreyfus deny charges by Argentine government of substantial tax evasion

a long excerpt from the post:

The world's four largest grain traders, responsible for the vast majority of global corn, soya and wheat trading and processing, have been accused of large-scale tax evasion in a landmark series of cases being brought against them by the Argentinian government.

In an interview with the Guardian, Ricardo Echegaray, the head of AFIP, the country's revenue and customs service, has given a detailed account of the charges his department is bringing against ADM, Bunge, Cargill and Dreyfus.

"These companies have gone into criminality," Echegaray said. "2008 was when agricultural commodities prices spiked and was the best year for them in prices, yet we could see that the companies with the biggest sales showed very little profit in this country."

The Guardian has learned from separate sources that AFIP is seeking to claim $476m (£290m) for what it says are unpaid tax and duties from Bunge, $252m from Cargill and $140m from Dreyfus. The companies have all denied all the allegations and have said they will defend themselves vigorously.

With the global food system and who controls it under intense scrutiny in recent weeks, thanks to record prices, the legal battle between Afip and the "ABCD four", as they are known, has taken on heightened significance.

Oxfam, in a report earlier this week, warned of spiralling prices and a huge increase in global hunger over the next two decades, and said that corporate concentration in the global food trade was a structural flaw in the system. (see "Food prices to double by 2030, Oxfam warns - Charity says era of permanent food crisis will hit poorest people hardest and spark social unrest")

Echegaray said he had begun investigating Argentina's large business taxpayers towards the end of 2008, cross-checking information given to his authorities with that from other countries where their exports were destined, by making use of tax information exchange treaties – some of which have been newly signed. He also cross-checked declarations made to Argentinian customs with corporate income tax returns.

He said he had evidence from his detailed inquiry that all four traders had submitted false declarations of sales and routed profits through tax havens or their headquarters, in contravention of Argentinian tax law.

He also alleged they had on occasion used phantom firms to buy grain. He further alleged that they had inflated costs in Argentina to reduce taxable profits or claim tax credits there.

The AFIP inquiry has focused on the traders' sales to Uruguay, among other low-tax jurisdictions.

Echegaray said Bunge had set up an office in the tax-free zone of Montevideo through which it began routing its exports after 2007, from which point it declared no gains in Argentina. He alleged his checks had revealed that Bunge employed only a handful of people in Uruguay's capital, and that it had no real imports or exports from that office other than small items for those staff.

Bunge was expelled from the Argentine exporters' register last week.

Echegaray alleged that Cargill had also used Uruguay and Swiss subsidiaries to evade taxes in Argentina.

Cargill, ADM and Dreyfus were suspended from the exporters' register by the government earlier this year as a result of the investigation.

There is more, but I'll end the excerpt here because I just want to say how awesome it is that Argentina is prosecuting these awful agribusinesss giants who determine the price of everybody's daily bread, throughout the world, which is a scandal in itself!

Christian Aid's "TAX" page: View the 2 videos &/or Click to 'Demand Action on Tax: Tax and malnutrition in Guatemala, Case Study / The True Cost of Flowers from Kenya

End Tax Haven Secrecy - Call on the G20 to end tax haven secrecy: Tax dodging by some unscrupulous multinational companies costs developing countries an estimated $160bn a year - more than the entire global aid budget.

This November, leaders of the world's 20 largest economies (the G20) are meeting in France.
They have the power to end tax haven secrecy, which allows tax dodging to thrive and cheats poor countries out of vital funds.

Call on David Cameron, Nick Clegg and Nicolas Sarkozy to end tax haven secrecy.

Also from the Guardian: Food Crises: Five Priorities for the G20 - Hunger is not a natural disaster – it's a political problem. And G20 leaders can and must act to end this scandal.

Carole Sarcinello (338)
Thursday June 16, 2011, 8:29 am

Thanks for posting this, Jill.

Cross-posted in the Care2 group, Global Alliance to Ban GMOs!

LucyKaleido ScopeEyes (82)
Thursday June 16, 2011, 8:44 am
Great, Carole; thanks!

The Guardian report doesn't say anything about the GM connection, but I had seen the following on GMWatch first, & used 'GM Soy Giants' in my title as a result:

"Argentina accuses GM soy giants of huge tax evasion" -

The Argentine government has hitherto been an enthusiastic supporter of the the soy economy (most of which is GM soy), because it has levied export taxes on soybeans that reached a massive 35 per cent in 2010.

But now the Argentine government says it isn't seeing those taxes. It has accused the big four soy traders in Argentina of tax evasion. So perhaps its love affair with GM soy is coming to an end.

Note that all four of the grain traders accused of tax evasion by the Argentine government are members of the corporate greenwash program, the Round Table on Responsible Soy, which certifies GM soy as "responsible".

GMWatch then links to the Guardian article for the details.

LucyKaleido ScopeEyes (82)
Thursday June 16, 2011, 12:26 pm
Speaking of corporate tax evasion... Glencore comes to mind. It's "the World’s Biggest Company that Nobody’s Ever Heard of…. Until Now!"

It had been heard of by activists, though, & other concerned people in connection with tax evasion in Zamibia related to very 'unprofitable' mining at the Mopani copper mine: there was a recent documentary about this on French TV channel 5. The legal advocacy group Sherpa was often cited during the documentary, so it comes as no surprise to find Sherpa as the author of the following press release, member of the 'European Coalition for Corporate Justice,' & one of the 5 NGOs involved: Tax evasion in Zambia: Five NGOs file an OECD complaint against Glencore International AG and First Quantum Minerals for violation of OECD guidelines. Zambia is now in a position to sue Glencore for a £100Million unpaid tax bill, thanks to Sherpa's investigation.

According to Global Financial Integrity's report, "Illicit Financial Flows from Developing Countries: 2000-2009," multinational corporations’ tax evasion, when averaged per year over the last ten years, amounts to a global net loss of $400 to $440 billion for developing countries.

And in a Guardian article, the managing director of Berne Declaration, an NGO in Switzerland where the commodities giant is based, Andreas Missbach, said, "Glencore has a 73% stake in the Mopani copper mine (in Zamibia), yet they pay royalties to Zambia of just 0.6%. Meanwhile, Zambia is number 150 out of 169 on the UN's Human Development Index. The scandal is that this is not a scandal." Roger Moody, director of consultancy Nostromo Research, added the Mopani mine "raises serious questions in regards to its land use, safety record, and air and water pollution".

A report last month based on publicly available negative news stories from sources including NGO websites and blogs listed more than 20 accusations against the company.

But tax evasion in Zambia, it turns out, is only one of the controversies surrounding Glencore: This time, for the benefit of the English-speaking world, "a recent Newsnight TV programme listed these as involving (in addition) breaking agreements in Namibia, having mines repossessed in Bolivia, rows with indigenous peoples in Australia and recent allegations of bribery of government officials in Belgium.

Glencore, one of the world’s major commodity firms, was just recently floated on the London Stock Exchange. The giant commodity business had revenues in 2010 of almost $145bn, employing more than 50,000 people through its subsidiaries.

How big is Glencore? Well, it controls half the world’s market in copper, significant shares in other metals, plus vast supplies of coal, gas, oil and grain. Such is the firm’s size that on flotation in London, it became the first company in 25 years (since BT and British Gas) to go straight in to the FTSE-100.

Almost five hundred Glencore 'partners' are making in excess of $100m each from the flotation. Five employees become instant billionaires. This incredible wealth comes from the fact that these executives own almost a third of Glencore’s stock."

But they refuse to pay Zambia the £100Million in unpaid taxes!!


Roger G (148)
Friday June 17, 2011, 2:18 pm
thanks !

Lynne Buckley (0)
Saturday June 18, 2011, 10:57 am
Thanks for this. Too many companies try to avoid paying taxes. If they're guilty they deserve to be charged and punished.

Andrea Connelly (94)
Saturday June 18, 2011, 2:08 pm
Echegaray is a brave man.! I fear for his safety and that of his family. As for Switzerland and its banking laws, a big thumbs down! How smug that little country is sitting in self induced deception. Must be all the inbreeding.

Bonnie B (103)
Saturday June 18, 2011, 7:11 pm
Noted! Thanks, PeasantDi! It would seem that the only way to get these huge multi-nationals to behave with a social conscience is to sic the lawyers on 'em! Whatever works!

LucyKaleido ScopeEyes (82)
Sunday June 19, 2011, 2:23 am
In Case you didn't notice the opportunity to TAKE ACTION in my first comment, here are the links again:

Christian Aid's "TAX" page: View the 2 videos &/or Click to 'Demand Action on Tax: Tax and malnutrition in Guatemala, Case Study / The True Cost of Flowers from Kenya

End Tax Haven Secrecy - Call on the G20 to end tax haven secrecy

LucyKaleido ScopeEyes (82)
Monday June 20, 2011, 12:39 am
We humans need to develop a 'social conscience', Bonnie; corporations need rules & regulation !

patricia lasek (317)
Monday June 20, 2011, 6:00 am
Thanks Jill. I signed the petitions.

What a time I had trying to access this article from your message. I finally got it though.

Keep up the good fight!
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