Green Card: Don’t Pay to Get One!

It’s amazing. The very first spam ever sent was from a couple of lawyers who offered
to help people get a Green Card if they paid the law firm a small fee. A Green Card,
for those of you that don’t know, is a proof of permanent resident alien status from
the feared Immigration and Naturalization Service and.. it’s free, if you qualify. So
you don’t need to pay anyone for anything. Even better, the document required is
pretty simple to fill out.

If it’s free and easy to fill out, why are there still lawyers selling their service to aid
in receiving a Green Card? Here’s what the Federal Trade Commission [http://www.ftc.gov/bcp/conline/pubs/alerts/lottery.htm] has
to say about Green Card scams:

If you or someone you know is trying to get a green card – the right to live in the
United States permanently – be on the lookout for unscrupulous businesses and
attorneys. They’ll claim that, for a fee, they can make it easier to enter the U. S. State
Department’s annual Diversity Visa (DV) lottery (also known as the “green card
lottery”) or increase your chances of winning the DV lottery.

Each year, the State Department conducts a lottery through its DV program to
distribute applications for 50,000 immigrant visas. Winners of the lottery have a
chance to apply for an immigrant visa, which can be used to enter the U. S. Winners
are selected randomly, and there is no fee to enter the lottery.”

If you’re interested in applying for a Green Card, you should just go straight to the
U.S. Department of State’s dvlottery.state.gov [http://%0D%0Awww.dvlottery.state.gov/] site and apply!

The FTC continues with this warning:

Green Card Lottery Scams

According to lawyers at the Federal Trade Commission (FTC), the nation’s consumer
protection agency, some businesses and attorneys misrepresent their services by
saying that:

they are affiliated with the U.S. government;
they have special expertise or a special entry form that is required to enter the
lottery;
their company has never had a lottery entry rejected;
their company can increase an entrant’s chances of “winning” the lottery;
people from ineligible countries still are “qualified” to enter the lottery.

In addition, some companies jeopardize an entrant’s opportunity to participate in
the lottery by filing several entries. These companies also may charge lottery-
winning applicants substantial fees to complete the application process.”

Monaco Might Lose Its Status of Personal Income Tax Haven

That Monaco is crowded with celebrities is no piece of news. Since 1869, when the personal income tax policy became favorable, Monaco attracted very many individuals with high net income, such as movie stars, sporting stars etc. who became residents of the Principality in order to benefit from personal income tax exemption.

Take, for instance, Roger Moore, Shirley Bassey, Ringo Starr, Karen Mulder, Eva Herzigova, the race drivers Jacques Villeneuve, David Coulthard, Jenson Button.

But the number of celebrities is far outnumbered by the number of business people who enjoy the country’s tax facilities: the retail tycoon Philip Green and the Barclay brothers are Monegasque residents.

Being a resident of Monaco implies proving you have a place to live and are rich enough to afford a very high standard way of life. And I mean really rich, as a place to live in the apartment blocks jammed into two square kilometres, either rented or bought, is extremely high.

Keeping residency implies proving you live in Monaco at least 6 months and a day per year. If you are rich, the advantage of being a Monaco resident is that, besides enjoying a sunny, pleasant climate, you can live at the same time in another country. The Principality is very close to main airports and is also easily reachable by sea, by car or by train. Thus, being a Monaco resident and working in another country is not only possible but it’s easy especially speaking of UK citizens: laws in UK permit a maximum stay of 90 days (without counting the day of departure and that of arrival!) for non-residents. Many UK business people reside in Monaco and work in the UK without surpassing the 90 days limit so that they are subject to Monaco lawas for taxation.

Having attracted so many rich resulted in a conflict of interests: many countries disapprove of this taxation policy, looking at it as an evasion from taxes in their national area. And not entirely wrongly! In fact, Monaco has been “tax-cheating” a little by attracting capital from the high tax countries.

Looking at the issue from the perspective of the Principality, seems to me only right to try and succeed to evolve with the few means and resources a state so small has. Monaco developed from one of the poorest countries in the world (in the 1860s) into a state with one of the world’s highest per capita income (around EUR22,000). And it was possible due to a strategic leadership of a resourceless country. It is after the territory was drastically reduced that this personal income tax policy came into being. Attracting foreign capital become one of the main targets for development. That’s how the Casino became grand and famous and emphasis was put on tourism, being raised at luxury levels.

After the individual taxation regulations, in 1963 the Principality came with another financial artifice: no tax for local company profits or dividends. Thus the target was to enhance local business flourishing. This stipulation combined with an almost hermetic data privacy did nothing else than to increase even more foreign investments in Monaco.

So, from the point of view of big economic powers, Monaco should be punished, and so deserves any country daring to offer a better taxation alternative, putting at a disadvantage their high-tax based economy. The OECD has a project on “harmful tax practices” stipulating a set of punitive measures for the non-cooperating jurisdictions.

Invoking money laundering and international terrorism tracking, many OECD governments promote a policy of free information exchange that has as main purpose limiting the tax competition, beyond the intention to limit tax evasion and to combat serious crime.

Estimated negative results of OECD policy:

* Eliminating tax competition would result in uniformizing taxes to the amount dictated by some governments. Without the possibility of choosing a better alternative, there is no reason for governments to reduce taxes and make the tax system more efficient.
* This policy would change the present status of emigrants that pay taxes only to their new country and would promote the premise that the state still has a right to benefit from its former national labour. This sounds to me like a violation of fundamental human rights.

Although in 2004 still on the OECD black list of the tax policy non-cooperating jurisdictions, Monaco has changed its policy regarding the high confidentiality of financial data in the light of the expected, recent admission to the Council of Europe (Monaco joined the Europe Council on October 5, 2004 ). Modifications to legislation:

* October 2001: French citizens living in Monaco since 1989 must pay a wealth tax beginning with 2002.
* Information on French nationals are to be unconditionally provided to the Bank of France when required. Information may be passed on to the authorities of France or of a third country if necessary.
* 2004: Under EU’s Savings Tax Directive, Monaco will impose a witholding tax on the returns on savings such as bank interests earned by EU citizens. The tax quantum will be the same as in Austria, Belgium and Luxembourg (initially 15%). 75% of such revenues will be handed over to the Member State of the respective EU resident. This will be applied beginning with 2005.
* December 2000: Monaco signs the United Nations Convention Against Transnational Organised Crime. The treaty stipulates that its members do not permit anonymous accounts requiring identification of customers. Banks must keep accurate records of accounts and report any suspicious transaction. Moreover, the domestic law enforcement officials are permitted inspection of accounts.

Wit and Wisdom on Money, Wall Street and Success

I have received incredible feedback on the financial quotes series so I am providing another ten GEMS for you to ponder and evaluate. Sometimes a great book has had a profound impact in my life and made me change my ways. Occasionally a great quote has also had the same effect. Enjoy!

1) “I learned more about economics from one South Dakota dust storm than I did in all my years at college.”

-Hubert Humphrey

2) “A bull must be fed every day with good news. But a bear need only be fed once in a while.”

-Anonymous

3) “Each of us has a choice – we must make money work for us or we must work for money.”

-Conrad Leslie

4) “Don’t ever make the mistake of telling the market it is wrong.”

-James Dines

5) “It was never my thinking that made me money. It was my sitting.”

-Jesse Livermore

6) “Stocks are simple. All you do is buy shares in a great business for less than the business is intrinsically worth, with managers of highest integrity and ability. Then you own those shares forever.”

– Warren Buffett

7) “The trading rules I live by are: (a) Cut losses, (b) Ride Winners, (c) Keep bets small, (d) Follow the rules without question, and (e) Know when to break the rules.”

-Ed Seykota

8) “Taxpayer: Someone who works for the government but doesn’t have to take a civil service examination.”

-Ronald Reagan

9) “October. This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.”

-Mark Twain

10) “It’s not how much you make when you are right. It is how little you lose when you are wrong! Manage your risk on every trade and the winners will take care of themselves!”