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Speaker 1: News, global business news twenty four hours a day at

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Speaker 1: Bloomberg dot com, the radio, lost mobile, lapt and on

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Speaker 1: your radio. This is a Bloomberg Business Flash and good morning.

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Speaker 1: I'm John Tucker. Let's say head over to the Bloomberg

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Speaker 1: First Word Breaking news tests for today's morning call. Here's

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Speaker 1: Bill Maloney. Good morning John. A big deal in the

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Speaker 1: healthcare space today, amid global equity weakness, Abbot Labs to

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Speaker 1: buy Saint Jude Medical and a deal value about twenty

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Speaker 1: five billion. Abbitt is trading lower by eight and a

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Speaker 1: half percent pre market. Japan fell three point six percent

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Speaker 1: overnight as a b o J declined to add more stimulus,

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Speaker 1: while main upier markets are also lower across the board,

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Speaker 1: led by two percent losses in Spain. Here in the

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Speaker 1: U S dowth futures lower by a hundred and twenty

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Speaker 1: seven points, says to be dropped thirteen and NAZAC futures

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Speaker 1: declined by fourteen. The US ten year falls to one

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Speaker 1: point eight four percent on the US economic frontday eight thirty,

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Speaker 1: initial jobs claims and g d P At eleven o'clock,

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Speaker 1: Kansas City fed after develop US night. Facebook beat shares

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Speaker 1: her up ten percent pre market. Some of the earnings

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Speaker 1: highlights today at a time, Warner Cable, Bristol Myers, MasterCard

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Speaker 1: and Viacom all beat, Domino's Pizza missed and ups EPs

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Speaker 1: beat Another deal news first cash and Cash America to

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Speaker 1: merge in a two point four billion dollar deal, and

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Speaker 1: Santa Fee offered to buy Metivation for fifty two fifty

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Speaker 1: share in cash. In other news, Priceline CEO resigned shares

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Speaker 1: are currently halted. Finally, some of your wallsheet upgrades and downgrades.

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Speaker 1: Twitter cut to hold at Argust American Airlines raised away

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Speaker 1: at Morgan Stanley Schlumberge, cut the hold over at Sockchen,

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Speaker 1: and Hess cut to neutral at UBS Live from the

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Speaker 1: first breaking news desk gone Bill Maloney, John, thanks to

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Speaker 1: Bill and to hear live breaking news over your Bloomberg

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Speaker 1: type type squawk go on your terminal that gives a

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Speaker 1: Bloomberg the business flash, Toma, David John, she helped James

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Speaker 1: all right, John Tucker, Thank you very much. Michael and

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Speaker 1: David here. Michael Key along with David Gura, as we

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Speaker 1: uh trying to struggle along somehow without hard A lot

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Speaker 1: of reaction on Twitter to the question of where in

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Speaker 1: the world that was the that was the latest guess.

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Speaker 1: That's not correct. Not correct. Neil Rowski is with US.

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Speaker 1: I haven't talked to him in a while since he

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Speaker 1: was the former Inspector General at the Treasury Department for

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Speaker 1: the the Tarpie Asset Relief program. He's now at Jedder

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Speaker 1: and Block and he has an interesting new piece out

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Speaker 1: about transparency at the Treasury following the Panama papers released.

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Speaker 1: They're gonna dress they've got a rule in place, They're

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Speaker 1: gonna put it out there to compel US banks to

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Speaker 1: identify people who use shell companies, as many of those

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Speaker 1: identified in the Panama papers apparently did. Neil um if

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Speaker 1: this had been in place earlier, would we have the

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Speaker 1: kind of activity that we saw or is this kind

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Speaker 1: of a band aid on a much larger issue. Well, look,

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Speaker 1: I think it's a much larger issue. You know, the

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Speaker 1: United States really kind of stands alone in countries and

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Speaker 1: regulating its banks and not making this kind of simple

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Speaker 1: requirement that when you know, a a shell company company

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Speaker 1: also opens a bank account with the US Bank, it's

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Speaker 1: not required to identify who the actual owner of the companies.

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Speaker 1: You know, the term is beneficial owner, and this is

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Speaker 1: a problem for a whole host of reasons to encourage

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Speaker 1: its tax evasion. Uh. You know, these vehicles are often

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Speaker 1: used not just for hiding taxes, but for drug trafficking, laundering,

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Speaker 1: proseeds and so Treasury you know, proposed this rule really

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Speaker 1: about six years ago and it's just been bogged down.

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Speaker 1: But I think in the light of the Panama paper scandal,

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Speaker 1: they finally said, Okay, now we're gonna get it final. Um.

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Speaker 1: And that's a really good thing for law enforcement, and

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Speaker 1: it's a good thing for the banks themselves. Um. So

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Speaker 1: they have a better shot of knowing who these customers

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Speaker 1: are and keep them from getting into trouble, which we've

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Speaker 1: seen sort of over and over again in recent years. Niel.

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Speaker 1: As you point out in your piece, the US is

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Speaker 1: not party to the o e c d S Tax

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Speaker 1: Transparency Initiative. We are an outlier here. When you look

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Speaker 1: at all the countries that that are, I think it's

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Speaker 1: more than than a hundred that are. Why is that

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Speaker 1: the case? And do you see that changing here over time? Okay?

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Speaker 1: I think the you know, the the tax Transparency Issue

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Speaker 1: pro a o E c D is essentially requires countries

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Speaker 1: who sign onto it to get on a path to

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Speaker 1: automatically exchanging information with other countries about accounts held in

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Speaker 1: their country. And so the US really stands one in

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Speaker 1: a different aspect, and that it already requires countries around

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Speaker 1: the world or banks around the world to produce that

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Speaker 1: information to to the I R S. It's through a

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Speaker 1: bill past a couple of years ago called FATKA, So

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Speaker 1: they're already receiving all of that information, but they're not

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Speaker 1: providing that information to all the signatories of the o

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Speaker 1: E c D. They do it one off on some

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Speaker 1: country UH specific agreements. But I think, you know, automatic

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Speaker 1: exchange is sort of the future of global fight against

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Speaker 1: global tax sheets. So I think it's only a question

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Speaker 1: matter of time. But for any type of exchange to

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Speaker 1: be functional, whether it's through these one off agreements or

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Speaker 1: through the broader o E c D, there has to

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Speaker 1: be identification of beneficial owners. Otherwise, the information that's provided

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Speaker 1: is here's this shell company in the b v i UM,

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Speaker 1: So it actually doesn't even go to the home country

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Speaker 1: where the person is actually using the account, is is

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Speaker 1: there because the banks don't even know who that person is.

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Speaker 1: So I think it's inevitable, and I think this rule

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Speaker 1: is inevitable in that it helps get the United States

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Speaker 1: up to the same place where you know, countries that

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Speaker 1: we think of synonymous with tax evasion, Switzerland and the

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Speaker 1: Cayman Islands, you know, they all have this rule. So

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Speaker 1: it's it's really modernizing the US and sort of getting

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Speaker 1: up to speed of where the sort of necessary transparency

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Speaker 1: that's really just has to have in this sort of

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Speaker 1: global economy, especially with the threats of money laundering and terrorism. Well,

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Speaker 1: how big is is the issue of the papers really?

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Speaker 1: Obviously some focuses attention on it, but is this a

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Speaker 1: real major problem for the US Treasury? You know, it's

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Speaker 1: hard to know, right because it's it's an you know,

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Speaker 1: drug traffickers, and you know, criminals who use these accounts

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Speaker 1: don't sort of keep statistics and published them. About five

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Speaker 1: years there was an estimate that about forty forty billion

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Speaker 1: dollars is is funneled through these non transparent shell companies

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Speaker 1: in any given year. So that's a big number. And look,

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Speaker 1: you know, I was a former prosecutor as former head

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Speaker 1: of of a law enforcement agency that investigated drug trafficking,

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Speaker 1: white color crimes, and it's very, very frustrating when you

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Speaker 1: find a dirty account and the bank can't tell you

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Speaker 1: who the owner of the account is. It's a really

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Speaker 1: important law enforcement UM technique in addition to helping tax

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Speaker 1: transparency UM. And so this is one of those sort

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Speaker 1: of it doesn't solve everything this step, but it's a

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Speaker 1: right step in the right direction UM to sort of

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Speaker 1: help combat these problems which are really global and nature

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Speaker 1: in the United States stands alone and frankly, by standing

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Speaker 1: run on this, the United States is risks becoming known

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Speaker 1: as one of the world's biggest tax abn. It's lite

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Speaker 1: frog and countries that have traditionally held that role because

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Speaker 1: we make it easy for foreigners to hide their money

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Speaker 1: in the US from foreign tax authorities. And that's that's

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Speaker 1: not where we want to be. Neil Borowski from General Block,

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Speaker 1: thanks very much for being with us today. David Another.

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Speaker 1: We we have all kinds of red headlines out there.

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