Finance

US senate accuses billionaire Frank Lowy of hiding millions to dodge tax

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A report from a US senate committee investigating the use of offshore tax havens has claimed that the billionaire Lowy family “used transfer companies and a foundation with a Delaware corporation to help… hide their beneficial interest in a foundation wit

A report from a US senate committee investigating the use of offshore tax havens has claimed that the billionaire Lowy family “used transfer companies and a foundation with a Delaware corporation to help… hide their beneficial interest in a foundation with $US68 million in assets”.

Frank Lowy, founder of the global shopping centre, has been indentified by the US Senate Committee on Homeland Security and Governmental Affairs as a client of LGT Group, the secretive Liechtenstein bank owned by UBS and the Liechtenstein royal family.

The senate committee alleges LGT helped thousands of people avoid paying tax thanks to its secretive systems and procedures. The names of LGT clients and the inner workings of the bank were exposed this year when a disgruntled clerk at LGT, Heinrich Kieber, downloaded all the bank’s names and secret accounts on to two CDs and turned them over to tax authorities in the US and Europe.

The committee’s report, which cites internal LGT memos and recorded telephone conversations, claims that Lowy wanted to shelter assets from the Australian tax office by setting up a foundation in Liechtenstein called Luperla Foundation.

The report further claims that LGT internal memos “note that Mr Lowy had reached a settlement with the Australian Tax Office (and) did not want to bring new funds into Australia, and was concerned that if the Australian tax authorities learned of his having additional assets, the government might try to subject them to additional claims”.

Lowy paid $25 million in 1995 to settle a protracted dispute with the Australian tax office.

Lowy issued a statement yesterday confirming the tax office was conducting an audit of his affairs in relation to the Liechenstein allegations. But he denied he had done anything improper. “No attempt was made to save any Australian tax. Nor is it considered that any Australian tax was in fact saved.”

The statement also criticised the committee for relying on information stolen from the bank and the sub-committee “failed to give Frank Lowy or his family any meaningful opportunity to be heard or otherwise have the true position stated. This amounts to a denial of natural justice.”

Frank Lowy’s son Peter Lowy, who is a US citizen, was supposed to appear before the committee on 17 July, but could not attend. He is now scheduled to appear on 25 July.

 

Read more on Frank Lowy

 

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