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[News] [Rival] Financial Fraud Linked to Microsoft, more Legalised Tax Evasion

  • Subject: [News] [Rival] Financial Fraud Linked to Microsoft, more Legalised Tax Evasion
  • From: Roy Schestowitz <newsgroups@xxxxxxxxxxxxxxx>
  • Date: Wed, 02 Jun 2010 06:13:43 +0100
  • Followup-to: comp.os.linux.advocacy
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Hedge fund Pequot Capital settles with SEC for $28 million

,----[ Quote ]
| The SEC separately brought an enforcement 
| action against Zilkha, which is continuing 
| in an administrative proceeding before the 
| SEC.
| The SEC said that in Jan. 2009 it first 
| received direct evidence that Zilkha had 
| material, nonpublic information about 
| Microsoft, including copies of emails that 
| had been located on a computer hard drive 
| that was then in the possession of Zilkha's 
| ex-wife. 


At Long Last, 5-Year Pequot Probe Ends In Settlement


Pequot, Samberg Pay $28 Million to End Trading Probe


Pequot and Its Chief Settle Insider Complaint

,----[ Quote ]
| Separately, the S.E.C. has filed a 
| complaint against David Zilkha, a former 
| Microsoft employee who later worked at 
| Pequot, accusing him of tipping off the 
| hedge fund and Mr. Samberg with nonpublic 
| information about Microsoftâs earnings, the 
| agency said in a statement.
| The case against Mr. Zilkha will continue 
| in an administrative proceeding before the 
| commission, the agency said in a statement.


Pequot & CEO Settle with SEC for $28M


SEC Sues Pequot Capital, CEO Samberg With Insider Trading


Pequot's Samberg Charged With Insider Trading


Pequot, Samberg settle insider-trading charges


Trust Gates, Sr.? Washington state liberals? No way!

,----[ Quote ]
| Bill âI have my fortune, now I want to tax 
| yoursâ Gates, Sr. wants to tax all of those 
| ârich peopleâ with a state income tax.
| His ârichâ threshold is $250,000 in income 
| per year.
| What a deal. Our property taxes and the B&O 
| tax will be cut.
| Really?
| We can count on the state to do the cuts 
| after we vote this tax in?


Governor Gregoire Isn't Clueless, She's Gutless

,----[ Quote ]
| Her answer confused me since the bill she 
| just signed gave Microsoft a huge effective 
| tax cut, changing the royalty law from a 
| tax on gross worldwide revenue to one only 
| on sales to Washington State customers. 
| Whereas Microsoft will earn approximately 
| $20.7 billion in worldwide licensing 
| revenue this year, its sales to Washington 
| State are a tiny fraction of this. So 
| having slashed Microsoft's tax exposure, 
| what exactly did Gregoire want to bring 
| back?
| Furthermore, every effort in the 
| Legislature, spearheaded by 17 year veteran 
| ex-Microsoftee and Chair of the Finance 
| committee Rep. Ross Hunter, seemed geared 
| towards rewriting the system in favor of 
| Microsoft ... the legislation even includes 
| language which grants Microsoft amnesty on 
| its past 13 year Nevada tax dodge, an 
| estimated $757 million in unpaid taxes.
| [...]
| In the year of a $2.8 billion budget gap, 
| Gregoire chose not to cast Microsoft as a 
| tax evading villain, enforcing the old 
| royalty tax in a PR and legal coup that 
| might have netted the state $100.7 million 
| this year (note: that's more than $84.7 
| million) not to mention $1.2 billion in 
| past payments, interest and penalties, 
| instead she chose to raise the business 
| service tax rate, create new "7-11" taxes 
| on beer, wine and candy and to cut vital 
| services including unemployment benefits to 
| the disabled.
| [...]
| The Two Biggest Myths About Microsoft in 
| Washington State
| Rather than worry about the next ten 
| thousand high paying technology jobs 
| Microsoft's creating in India, China, Texas 
| and elsewhere, she wants us to believe 
| she's fighting the company to return its 
| 100 - 200 Nevada managed lawyers, 
| paralegals and accountants who run its 
| (formerly) tax avoiding royalty business. 
| As it only takes a small number of lawyers 
| and accountants to dodge $100.7 million 
| annually in taxes, Microsoft's tax 
| avoidance jobs don't scale the way it's 
| next big technical success like Azure, or 
| Natal or Kin might.
| The biggest myth in Washington State is 
| that Microsoft plans to grow its next ten 
| thousand jobs here. The second biggest myth 
| is that if we tax the company more it will 
| leave. The painful truth is that it's 
| already engaging in a number of steps to 
| reduce its growth (and even downsize) here 
| and we'd have to pass a lot more bad law 
| like the one Gregoire just signed if we 
| want them to stay.
| Meanwhile, no one in state government has 
| responded to legal precedents that suggest 
| the state might have prevailed in a lawsuit 
| to collect that billion in unpaid royalty 
| taxes from Microsoft. Why would they, 
| aren't we all on the same team?



Video: Exploring Microsoft's licensing taxes


Staff growth at Microsoft may ramp up

,----[ Quote ]
| The 11 new jobs that Microsoft announced at
| its Reno operation last week might be the
| harbinger of something bigger.
| After all, the company launched its
| licensing operation in Reno with only 40
| employees in 1997. Today, the Microsoft
| Licensing GP office employs 250 fulltime
| Microsoft staff and nearly 400 additional
| contract workers.
| [...]
| Microsoft Licensing GP in Reno handles
| support of licensing agreements with
| business customers and other organizations
| in North and South America.


3,088 Taxpayers Paid the B&O Royalty Tax in 2009

,----[ Quote ]
| According to the Department of Revenue,
| 3,088 taxpayers (or SUCKERS! as
| Microsoft's CEO Steve Ballmer might call
| them) paid B&O Royalty Tax in 2009.
| Below is the history of B&O Royalty taxes
| paid in Washington since 1999 (source: Wa.
| Dept. of Revenue via e-mail). Note: I
| calculated the taxes paid column at .00484
| of taxable revenue.
| While $6.3 million in royalty taxes were
| paid in '09, if Microsoft had been paying
| the tax on its $18.7 billion in licensing
| revenue - the state should have recorded
| more than $87.6 million in tax receipts.
| This may explain why Ballmer has so far
| refused to respond to our call to open up
| Microsoft's Washington and Nevada tax
| records.


Microsoft and licensing taxes, on KUOW

,----[ Quote ]
| Appearing on KUOW's "The Conversation" on
| Monday was Jeff Reifman, a former Microsoft
| employee who has been writing about
| Microsoft's software-licensing practices and
| whether they are illegal.
| He asserts that Microsoft sidesteps Washington
| tax law by licensing its software out of an
| office in Reno, Nev. Nevada has no software-
| licensing tax; Washington does.


Reno's Microsoft outpost has grown from 40 to 250 employees

,----[ Quote ]
| âThis is an attempt for people to know
| more about us,â said Mary Ellen Smith,
| general manager of the Reno operation
| which employs 250 people.


Now Obama is driving Microsoft overseas

,----[ Quote ]
| It takes an incredibly powerful company to threaten the U.S. government in
| hopes of impacting a significant decision, but thatâs precisely what
| Microsoft is doing. Microsoft CEO Steve Ballmer made headlines when he
| publicly attacked President Barack Obamaâs plan to cut tax breaks on U.S.
| companiesâ foreign profits, a plan which is currently awaiting Congressional
| approval. Mr. Ballmer suggests that if the tax succeeds, Microsoft may begin
| a significant move out of the U.S., taking with it tax revenue and jobs. He
| states, âIt makes U.S. jobs more expensive. Weâre better off taking lots of
| people and moving them out of the U.S. as opposed to keeping them inside the
| U.S.â
| [...]
| Mr. Ballmer, perhaps the most outspoken critic, did acknowledge that the
| Obama proposal preserved research and experimentation cost tax breaks. He
| warned, though, that the cuts to foreign exemptions would raise the cost of
| Microsoftâs 56,552 U.S. employees. He says this could necessitate moving them
| overseas. Microsoft was previously embroiled in a controversy over whether it
| should lay off foreign workers before U.S. ones.


Ballmer Says Tax Would Move Microsoft Jobs Offshore

,----[ Quote ]
| Microsoft Corp. Chief Executive Officer Steven Ballmer said the worldâs
| largest software company would move some employees offshore if Congress
| enacts President Barack Obamaâs plans to impose higher taxes on U.S.
| companiesâ foreign profits.


Ballmer Says Tax Would Move Microsoft Jobs Offshore


Tax plan would send jobs offshore, Ballmer says


Microsoft speaks against foreign profit tax proposal


Microsoft debt offering raises questions about plans for funds

,----[ Quote ]
| Microsoft, which has historically avoided borrowing money, this morning took
| the next step in its previously announced plan to raise funds through a
| public debt offering. The company made the move in a preliminary prospectus
| filed with the Securities and Exchange Commission.


How Obama's tax reforms could impact Microsoft's bottom line

,----[ Quote ]
| The debate hinges on policies that let companies with international
| operations avoid higher U.S. tax rates by reinvesting their foreign earnings
| overseas. The Obama administration last Monday detailed its plan to put a
| damper on that practice.
| "Currently, businesses that invest overseas can take immediate deductions on
| their U.S. tax returns for expenses supporting their overseas investments but
| nevertheless 'defer' paying U.S. taxes on the profits they make from those
| investments," the White House said in a May 4 briefing document. "As a
| result, U.S. taxpayer dollars are used to provide a significant tax advantage
| to companies who invest overseas relative to those who invest and create jobs
| at home."


Microsoft subsidiary has â477m pretax profit

,----[ Quote ]
| Microsoft Ireland Operations Ltd (MIOL) had turnover of â11.3 billion and
| paid corporation tax of â63.5 million according to accounts just lodged with
| the Companies Office and seen by The Irish Times.


Microsoft Ireland slashes US dividend as profits rise

,----[ Quote ]
| The dividend payment is roughly half the almost â3bn the Irish subsidiary
| remitted to the US headquarters in the financial year ended June 2006.


Microsoft in tax evasion soup

,----[ Quote ]
| Software major Microsoft Corpâs Indian subsidiary has been issued a
| show-cause notice for non-payment of service tax worth Rs 127 crore. The tax
| has been claimed on services offered to Microsoft Singapore by way of
| marketing support.


Tax benefit helped Microsoft's 3Q earnings

,----[ Quote ]
| Turns out Microsoft and Uncle Sam have been going back through the company's
| books from 2000 to 2003. Not knowing how that would end up, Microsoft
| had "over accrued" its tax provision in past quarters, said Colleen Healy,
| general manager of investor relations. With the review settled, the company
| was able to reduce that provision.


Microsoft Leads in Lobbying Largesse

,----[ Quote ]
| Microsoft is leading the tech industryâs charge up Capitol Hill, according to
| statistics released Monday.
| The world's largest software company spent $9 million on lobbyists to make
| its case in issues including taxes and trade, according to statistics
|                    ^^^^^^^^^^^^^^^^^^^^^^^^^
| compiled by the Center for Responsive Politics.


Bill Gates: Rich Individuals Should Pay More Tax, Wealthy Corporations Less?

,----[ Quote ]
| As Taxing Tennessee points out, Bill Gates opposes eliminating the death tax
| but is quite happy to have local and state taxes eliminated for his
| company...


Microsoft EULA lands it with $175m Indian tax headache

,----[ Quote ]
| Basing its ruling on the terms of Microsoft's own EULA (end-user license
| agreement), an Indian court has ordered the company to pay tax on royalty
| income generated in the country, Tax India Online (TIOL) reports.
| [...]
| âUnacceptable tax avoidance typically involved the creation of complex
| artificial structures by which, as though by the wave of a magic wand, the
| tax payer conjures out of the air a loss, or a gain, or expenditure, or
| whatever it may be, which otherwise would never have existed. These
| structures are designed to achieve an adventitious tax benefit for the
| taxpayer, and in truth are no more than raids on the public funds at the
| expense of the general body of taxpayers, and as such are unacceptable.


Cheers not jeers to Speaker Chopp on the Microsoft tax concession

,----[ Quote ]
| The Columbia Basin Herald this past week characterized House Speaker Frank
| Chopp as being a Forrest Gump, "stupid is as stupid does" villain for
| opposing big proposed tax breaks for Microsoft and Yahoo. The tax concession,
| those companies said, were necessary to keep them from fleeing Grant County,
| where they have huge server farms. The requests were similar to the $3.2
| billion in breaks Boeing Co. got from Governor Gary Locke and the Legislature
| when it threatened to take some of its assembly operations elsewhere.

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