Fraud-ridden Banks Are Not L.A.’s Only Option

Enough Is Enough: Fraud-ridden Banks Are Not L.A.’s Only Option

Posted on January 29, 2014 by Ellen Brown

http://ellenbrown.com/2014/01/29/enough-is-enough-banksters-are-not-l-a-s-only-option/

“Epic in scale, unprecedented in world history.” That is how William K. Black, professor of law and economics and former bank fraud investigator, describes the frauds in which JPMorgan Chase (JPM) has now been implicated. They involve more than a dozen felonies, including bid-rigging on municipal bond debt; colluding to rig interest rates on hundreds of trillions of dollars in mortgages, derivatives and other contracts; exposing investors to excessive risk; failing to disclose known risks, including those in the Bernie Madoff scandal; and engaging in multiple forms of mortgage fraud.

So why, asks Chicago Alderwoman Leslie Hairston, are we still doing business with them? She plans to introduce a city council ordinance deleting JPM from the city’s list of designated municipal depositories. As quoted in the January 14^th Chicago Sun-Times:

The bank has violated the city code by making admissions of dishonesty and deceit in the way they dealt with their investors in the mortgage securities and Bernie Madoff Ponzi scandals. . . . We use this code against city contractors and all the small companies, why wouldn’t we use this against one of the largest banks in the world?

A similar move has been recommended for the City of Los Angeles by L.A. City Councilman Gil Cedillo. But in a January 19th editorial titled “There’s No Profit in L A. Bashing JPMorgan Chase,” the L.A. Times editorial board warned against pulling the city’s money out of JPM and other mega-banks – even though the city attorney is suing them for allegedly causing an epidemic of foreclosures in minority neighborhoods.

 “L.A. relies on these banks,” says The Times, “for long-term financing to build bridges and restore lakes, and for short-term financing to pay the bills.” The editorial noted that a similar proposal brought in the fall of 2011 by then-Councilman Richard Alarcon, backed by Occupy L.A., was abandoned because it would have resulted in termination fees and higher interest payments by the city.

It seems we must bow to our oppressors because we have no viable alternative – or do we? What if there is an alternative that would not only save the city money but would be a safer place to deposit its funds than in Wall Street banks?

The Tiny State That Broke Free

There is a place where they don’t bow. Where they don’t park their assets on Wall Street and play the mega-bank game, and haven’t for almost 100 years. Where they escaped the 2008 banking crisis and have no government debt, the lowest foreclosure rate in the country, the lowest default rate on credit card debt, and the lowest unemployment rate. They also have the only publicly-owned bank.

The place is North Dakota, and their state-owned Bank of North Dakota (BND) is a model for Los Angeles and other cities, counties, and states.

Like the BND, a public bank of the City of Los Angeles would not be a commercial bank and would not compete with commercial banks. In fact, it would partner with them – using its tax revenue deposits to create credit for lending programs through the magical everyday banking practice of leveraging capital.

The BND is a major money-maker for North Dakota, returning about $30 million annually in dividends to the treasury – not bad for a state with a population that is less than one-fifth that of the City of Los Angeles. Every year since the 2008 banking crisis, the BND has reported a return on investment of 17-26%.

Like the BND, a Bank of the City of Los Angeles would provide credit for city projects – to build bridges, restore lakes, and pay bills – and this credit would essentially be interest-free, since the city would own the bank and get the interest back. Eliminating interest has been shown to reduce the cost of public projects by 35% or more.

Awesome Possibilities

 Consider what that could mean for Los Angeles. According to the current fiscal budget, the LAX Modernization project is budgeted at $4.11 billion. That’s the sticker price. But what will it cost when you add interest on revenue bonds and other funding sources? The San Francisco-Oakland Bay Bridge earthquake retrofit boondoggle was slated to cost about $6 billion. Interest and bank fees added another $6 billion. Funding through a public bank could have saved taxpayers $6 billion, or 50%.

If Los Angeles owned its own bank, it could also avoid costly “rainy day funds,” which are held by various agencies as surplus taxes. If the city had a low-cost credit line with its own bank, these funds could be released into the general fund, generating massive amounts of new revenue for the city.

The potential for the City and County of Los Angeles can be seen by examining their respective Comprehensive Annual Financial Reports (CAFRs). According to the latest CAFRs (2012), the City of Los Angeles has “cash, pooled and other investments” of $11 billion beyond what is in its pension fund (page 85), and the County of Los Angeles has $22 billion (page 66). To put these sums in perspective, the austerity crisis declared by the State of California in 2012 was the result of a declared state budget deficit of only $16 billion.

The L.A. CAFR funds are currently drawing only minimal interest. With some modest changes in regulations, they could be returned to the general fund for use in the city’s budget, or deposited or invested in the city’s own bank, to be leveraged into credit for local purposes.

Minimizing Risk

 Beyond being a money-maker, a city-owned bank can minimize the risks of interest rate manipulation, excessive fees, and dishonest dealings.

Another risk that must now be added to the list is that of confiscation in the event of a “bail in.” Public funds are secured with collateral, but they take a back seat in bankruptcy to the “super priority” of Wall Street’s own derivative claims. A major derivatives fiasco of the sort seen in 2008 could wipe out even a mega-bank’s available collateral, leaving the city with empty coffers.

The city itself could be propelled into bankruptcy by speculative derivatives dealings with Wall Street banks. The dire results can be seen in Detroit, where the emergency manager, operating on behalf of the city’s creditors, put it into bankruptcy to force payment on its debts. First in line were UBS and Bank of America, claiming speculative winnings on their interest-rate swaps, which the emergency manager paid immediately before filing for bankruptcy. Critics say the swaps were improperly entered into and were what propelled the city into bankruptcy. Their propriety is now being investigated by the bankruptcy judge.

Not Too Big to Abandon

Mega-banks might be too big to fail. According to U.S. Attorney General Eric Holder, they might even be too big to prosecute. But they are not too big to abandon as depositories for government funds.

There may indeed be no profit in bashing JPMorgan Chase, but there would be profit in pulling deposits out and putting them in Los Angeles’ own public bank. Other major cities currently exploring that possibility include San Franciscoand Philadelphia.

If North Dakota can bypass Wall Street with its own bank and declare its financial independence, so can the City of Los Angeles. And so can the County. And so can the State of California.

____________

Ellen Brown is an attorney, chairman of the Public Banking Institute, and author of 12 books including The Public Bank Solution. She is currently running for California state treasurer on the Green Party ticket.

Greece: EU lawmakers probe bailout enforcers

http://www.star-telegram.com/2014/01/29/5522661/greece-eu-lawmakers-probe-bailout.html?rh=1

Posted Wednesday, Jan. 29, 2014

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The Associated Press

ATHENS, Greece — Government and opposition party officials are meeting with a European Parliament delegation visiting Athens to investigate whether international bailout enforcers caused unnecessary hardship among Greeks.

The seven-member delegation led by a conservative Austrian lawmaker, Othmar Karas, met with Finance Minister Yannis Stournaras and left-wing opposition leader Alexis Tsipras.

Bailout inspectors from the European Union, European Central Bank and International Monetary Fund — known as the troika — have supervised harsh austerity measures that have reined in chronic government overspending but have also pushed the unemployment rate past 27 percent.

The visiting delegation is due to report on their findings in April.

Read more here: http://www.star-telegram.com/2014/01/29/5522661/greece-eu-lawmakers-probe-bailout.html?rh=1#storylink=cpy

Power of Banks vs Democracy

FEDERAL RESERVE: "free money for cronies"

Want to Reduce Income/Wealth Inequality? Abolish the Engine of Inequality, the Federal Reserve  
 (Charles Hugh Smith, January 28, 2014) http://www.oftwominds.com/blogjan14/Fed-causes-inequality1-14.html

The Federal Reserve is the primary obstacle to reducing income/wealth inequality. Those who support the Fed are supporting a neofeudal arrangement that widens the income/wealth gap by its very existence.
The issue of income/wealth inequality is finally moving into the mainstream: which is to say, politicos of every ideological stripe now feel obliged to bleat platitudes and express cardboard "concern" for the plight of the non-millionaires with whom they personally have little contact.
I have addressed the complex causes of rising income/wealth inequality for years. Indeed, my book Why Things Are Falling Apart and What We Can Do About It is largely about this very issue.
Here is a selection of the dozens of entries I have written about rising income/wealth inequality.
Income Inequality in the U.S. (August 22, 2008)
Made in U.S.A.: Wealth Inequality (July 15, 2011)
Let's Pretend Financialization Hasn't Killed the Economy (March 8, 2012)
Income Disparity and Education (September 26, 2013)
Is America's Social Contract Broken? (July 17, 2013)
Rising Inequality and Poverty: Can They Be Fixed? (August 15, 2013)
How Cheap Credit Fuels Income/Wealth Inequality (May 30, 2013)
Why Is Debt the Source of Income Inequality and Serfdom? It's the Interest, Baby (November 27, 2013)
While many key drivers of declining income are structural and not "fixable" with conventional policies (globalization of labor and the "end of work" replacement of human labor by robots, automation and software, to name the two most important ones), the financial policies that create wealth/income inequality are made right here in the U.S.A. by the Federal Reserve.
We should start addressing wealth/income inequality by eliminating the primary source of wealth/income inequality in the U.S.: the Federal Reserve.
The Fed generates wealth/income inequality in three basic ways:
1. Zero-interest rates (ZIRP) and limitless liquidity creates cheap credit that enables the super-wealthy to buy rentier income streams that increase their wealth.
The closer one is to this gargantuan flood of "free money for cronies," the wealthier one can become by borrowing from the Fed for near-zero and buying assets that yield returns well above zero. If your speculative bet goes bad, the Fed will bail you out.
2. Zero-interest rates (ZIRP) and limitless liquidity feedsfinancialization, broadly speaking, the commoditization of debt and debt instruments. The process of commoditizing (securitizing) every loan or debt greatly increases the income and wealth of the financial sector and the state (government), which reaps higher taxes from skyrocketing financial profits, bubbles and rising asset values (love those higher property taxes, baby!).
There is no persuasive evidence that cheap credit enables legitimate wealth creation, while there is abundant evidence that cheap credit fuels speculation, credit bubbles and a variety of financier schemes and scams that create temporary phantom wealth for crony capitalists and impoverishes everyone who wasn't in on the scam.
The housing bubble was not just a credit bubble; it was a credit bubble enabled by the securitization/financialization of the primary household asset, the home. Those closest to the Fed-enabled flow of credit reaped the gains of this financialization (or were subsequently bailed out by the Fed after the bubble burst), while the households that believed the Fed's shuck-and-jive ("There is no bubble") suffered losses when the bubble popped.
This chart of income inequality depicts the correlation between the Fed's easy-money credit expansion and the extraordinary increase in income inequality. Please note the causal relation between income and wealth; though it is certainly possible to squander one's entire income, those households with large incomes tend to acquire financial wealth. Those with access to cheap credit are able to buy income-producing assets that add to their wealth.

Financialization is most readily manifested in the FIRE sectors: finance, insurance, real estate.
You can see the results of financialization in financial profits, which soared in the era of securitization, shadow banking, asset bubbles and loosened or ignored regulation:

Here's how cheap, abundant credit--supposedly the key engine of growth, according to the Federal Reserve--massively increases wealth inequality: the wealthy have much greater access to credit than the non-wealthy, and they use this vastly greater credit to buy productive assets that generate income streams that increase their income and wealth.
As their income and wealth increase, their debt loads decline.

The family home is supposed to be a store of wealth, but the financialization of housing and changing demographics have mooted that traditional assumption; the home may rise in yet another bubble or crash in another bubble bust. It is no longer a safe store of value, it is a debt-based gamble that is very easy to lose.
Credit has rendered even the upper-income middle class family debt-serfs, while credit has greatly increased the opportunities for the wealthy to buy rentier income streams. Credit used to purchase unproductive consumption creates debt-serfdom; credit used to buy rentier assets adds to wealth and income. Unfortunately the average household does not have access to the credit required to buy productive assets; only the wealthy possess that perquisite.
The Fed's Solution to Income Stagnation: Make Everyone a Speculator (January 24, 2014)
As a direct result of Fed policy, the rich get richer and everyone else gets poorer.
3. But that isn't the end of the destructive consequences of Fed policy: the Federal Reserve has also created a neofeudal society in which debt enslaves the masses and enriches the financial Elites.
Put another way, not all wealth is created equally. Compare Steve Jobs, who became a billionaire by developing and selling "insanely great" mass-market technologies that people willingly buy because it enhances their lives, with a crony-capitalist who reaps billions in profits from risky carry trades funded by the Fed's free-money-for-cronies policy or by selling phantom assets (mortgages, for example) to the Fed at a price far above market value.
Clearly, there is a distinction between those two fortunes: one created value, employment for thousands of people, and tremendous technological leverage for millions of ordinary people. The other enriched a handful of financiers. This financial wealth could not be conjured into existence and skimmed by Elites without the Federal Reserve.
This Fed-enabled financial wealth destroys democracy and free markets when it buys the machinery of governance. To the best of my knowledge, Jobs spent little of his time or wealth lobbying Big Government for favors, special laws eliminating competitors with regulatory hurdles, etc.
Compare that to the millions spent by the "too big to fail" banking industry to buy Congressional approval of their cartel's grip on the nation's throat: Buying Off Washington To Kill Financial "Reform".
Much of the debate about wealth inequality focuses on whether the super-wealthy are "paying their fair share" of the nation's taxes. If we refer to the point above, we see that as long as the super-wealthy can buy the machinery of governance, then they will never allow themselves to be taxed like regular tax donkeys.
Unfortunately, only the top 1/10th of 1% can "afford" this kind of Fed-funded "democracy." As of 2007, the bottom 80% of American households held a mere 7% of these financial assets, while the top 1% held 42.7%, the top 5% holds 72% and the top 10% held fully 83%.

The income of the top 5% soared during Fed-enabled credit bubbles:

Since all these distortions originate from the Fed, the only solution is to abolish the Fed. Those who have absorbed the ceaseless propaganda believe that an economy needs a central bank to create money and manage interest rates.
This is simply wrong. The U.S. Treasury (a branch of government actually described by the Constitution, unlike the Fed) could print money just as it borrows money. Should a liquidity crisis squeeze rates higher, the Treasury has the means to create liquidity and make it available to the legitimate financial system.
All the Fed's regulatory powers were power-grabbed from legitimate government agencies defined by the Constitution.
The Federal Reserve is the primary engine of income/wealth inequality in the U.S. Eliminate "free money for cronies," bailouts of the "too big to fail" banks that own the Fed, manipulation of markets, the purchase of impaired private assets at high prices, and all the other tools of financialization the Fed wields to enforce its grip on the nation's throat--in other words, abolish the Fed--and the neofeudal structure that feeds inequality will vanish along with the feudal lords that enforced it.

We don't need to "fix" things as much as remove the obstacles that are blocking the way forward. The Federal Reserve is the primary obstacle to reducing income/wealth inequality. Those who support the Fed are supporting a neofeudal arrangement that widens the income/wealth gap by its very existence.

China's princelings riches in Caribbean offshore haven

China's princelings storing riches in Caribbean offshore haven

Relatives of political leaders including China's current president and former premier named in trove of leaked documents from the British Virgin Islands

http://www.theguardian.com/world/ng-interactive/2014/jan/21/china-british-virgin-islands-wealth-offshore-havens

By James Ball and Guardian US Interactive Team

More than a dozen family members of China's top political and military leaders are making use of offshore companies based in the British Virgin Islands, leaked financial documents reveal.

The brother-in-law of China's current president, Xi Jinping, as well as the son and son-in-law of former premier Wen Jiabao are among the political relations making use of the offshore havens, financial records show.

One of the Communist Party's "Eight Elders's" son

Fu Liang is the son of Peng Zhen, former mayor of Beijing and one of China's "eight elders". After a career in the rail industry, he shifted to a role in the leisure sector, as an investor in yacht clubs and golf courses.

Graphic shows senior Chinese figures and their relatives with offshore connections. There is no indication the leadership figures had any involvement in or awareness of the family members' financial activities.

The documents also disclose the central role of major Western banks and accountancy firms, including PricewaterhouseCoopers, Credit Suisse and UBS in the offshore world, acting as middlemen in the establishing of companies.

The Hong Kong office of Credit Suisse, for example, established the BVI company Trend Gold Consultants for Wen Yunsong, the son of Wen Jiabao, during his father's premiership — while PwC and UBS performed similar services for hundreds of other wealthy Chinese individuals.

The disclosure of China's use of secretive financial structures is the latest revelation from "Offshore Secrets", a two-year reporting effort led by theInternational Consortium of Investigative Journalists (ICIJ), which obtained more than 200 gigabytes of leaked financial data from two companies in the British Virgin Islands, and shared the information with the Guardian and other international news outlets.

In all, the ICIJ data reveals more than 21,000 clients from mainland China and Hong Kong have made use of offshore havens in the Caribbean, adding to mounting scrutiny of the wealth and power amassed by family members of the country's inner circle.

As neither Chinese officials nor their families are required to issue public financial disclosures, citizens in the country and abroad have been left largely in the dark about the elite's use of offshore structures which can facilitate the avoidance of tax, or moving of money overseas. Between $1tn and $4tn in untraced assets have left China since 2000, according to estimates.

China's inequality problem

Income inequality is a mounting issue in China, a consequence of the country's rapid growth. A Beijing university study suggests that income at the richest 5th percentile are 34 times higher than those of the bottom 5th percentile.

percentile

5%

¥1,000

$170

10 

¥2,000

$340

25 

¥4,500

$765

50 

¥9,000

$1,530

75 

¥15,900

$2,703

90 

¥25,800

$4,386

95 

¥34,300

$5,831

Source: Beijing university study, 2012 incomes

China's rapid economic growth is leading to a degree of internal tension within the nation, as the proceeds of the country's newfound prosperity are not evenly divided: the country's 100 richest men are collectively worth over $300bn, while an estimated 300m people in the country still live on less than $2 a day. The Chinese government has made efforts to crack down citizens' movements aimed at promoting transparency or accountability among the country's elite.

The confidential records obtained by the ICIJ relate to the incorporation and ownership of offshore companies, which is legal, and give little if any information as to what activities the businesses were used for once established. Offshore companies can be an important tool for legitimate Chinese businesses, especially when operating overseas, due to restrictions and legislation in the country.

One Chinese political family whose financial affairs have not escaped scrutiny — at least in the west — is that of the former premier, Wen Jiabao. In November, the New York Times reported that a consultancy firm operated by Wen's daughter, who often goes by the name Lily Chang, had been paid $1.8m by the US financial services giant JPMorgan.

A former premier, a banking regulator and a venture capitalist

Liu Chunhang is the son-in-law of former premier Wen Jiabao, and the husband of Wen's daughter Lily Chang. He currently works for China's banking regulator, and is a former Morgan Stanley employee.

Wen Yunsong is the son of Wen Jiabao. Educated in the USA, at Northwestern University, he is a venture capitalist, and current chairman of a state-owned satellite services company.

The payment has become one of the targets of a probe by US authorities into the activities of JPMorgan in China, including an examination of the firm's hiring practices, which are alleged to have included the deliberate targeting of relatives of influential officials.

However, the ICIJ files reveal the role of the BVI's offshore secrecy in obscuring Chang's links with her consulting firm, Fullmark Consultants. The company was set up in the BVI by Chang's husband, Liu Chunhang, in 2004, and he remained as sole director and shareholder until 2006, when he took a job in China's banking regulation agency.

Nominal ownership of the firm was transferred at that time to Zhang Yuhong, a Wen family friend, who the New York Times reported had connections with the Wen family's business interests.

The company established for Chang's brother Wen Yunsong, with the aid of Credit Suisse, was dissolved in 2008, with little hint as to its purpose or activities in the two years it was operational. One purpose for such companies is to allow for the establishment of bank accounts in the company's name, a legal measure that nonetheless makes tracing of assets a more complicated task.

No members of the Wen family, nor Zhang, responded to any of multiple approaches for comment, made over a period of several weeks by ICIJ reporters.

However, in a recent letter dated December 27th apparently sent to a Hong Kong columnist amid public anti-corruption probes into other former officials, Wen Jiabao is reported to have denied any wrongdoing during his premiership, or in how his family obtained their reported wealth.

"I have never been involved and would not get involved in one single deal of abusing my power for personal gain because no such gains whatsoever could shake my convictions," he is reported to have written.

A spokesman for Credit Suisse refused to comment on any specific case or client, but said the bank had "detailed procedures for dealing with politically exposed persons" which complies with money laundering regulations in Switzerland and elsewhere.

"Credit Suisse is required by Swiss law to uphold bank client confidentiality and is therefore unable to comment on this matter," he said. "In the absence of any further information, the media cannot be certain that they have a full understanding of the matter. As a result, they will not be able to portray it accurately or objectively."

The president and a businessman

Deng Jiagui is a businessman who became the brother-in-law of China's current president Xi Jinping when he married his older sister in 1996. His background is in the tobacco industry, but he and his wife currently own luxury property across China and Hong Kong.

The ICIJ records also detail a company connected to Deng Jiagui, the husband of the older sister of Xi Jinping, China's president, who has cultivated a public image as an anti-corruption campaigner. According to the BVI records, Deng, a real-estate developer and investor, owns a 50% stake in the BVI-incorporated Excellence Effort Property Development. Ownership of the remainder of the company traces back to two Chinese property tycoons, who last year won a $2bn real estate bid.

Other "princelings" — a widely-used term for the families of China's political elite — with offshore ties include: Li Xiaolin, a senior executive in one of China's state-owned power firms and the daughter of former premier Li Peng; Wu Jianchang, the son-in-law of China's late "paramount leader" Deng Xiaoping; and Hu Yishi, a cousin of former president Hu Jintao.

China's political elite were not the only individuals taking advantage of the BVI's offshore anonymity. At least 16 of China's richest people, with a combined estimated net worth in excess of $45bn, were found to have connections with companies based in the jurisdiction.

Among those was Huang Guangyu, the founder of China's largest electronics retailer and once the country's richest man. Huang and his wife had a network of more than 30 companies in the BVI, according to the ICIJ records. Huang subsequently fell from grace and was in 2010 sentenced to 14 years in prison for insider trading and bribery.

Despite his imprisonment, Huang's offshore network is not standing idle. In 2011, one of his BVI firms made an unsuccessful bid for the Ark Royal, the retired aircraft carrier which was once the flagship of the British navy. According to press reports, Huang planned to turn the carrier into a shopping mall, but navy officials decided instead to scrap the ship.

Shareholders of offshore companies

China has become a vital client for offshore jurisdictions. The ICIJ's databse of offshore owners and shareholders has six times as many addresses tied to China or Hong Kong than it does to the USA.

China and Hong Kong

21,321

Taiwan

15,835

Singapore

3,843

United States

3,713

Indonesia

2,506

Russia

2,166

Malaysia

1,490

Cyprus

994

United Kingdom

762

India

640

In total, the ICIJ database — which covers just two of the BVI's numerous incorporation agencies — lists more than 21,000 addresses in China or Hong Kong as directors or shareholders of offshore companies, demonstrating the country's status as one of the premier buyers of offshore services. In recent years, offshore jurisdictions have aggressively courted the Chinese market, with many opening offices and promotional sites in Hong Kong.

The BVI's courtship of China's rich and powerful may prove an embarrassment for the United Kingdom. The BVI remains a British overseas territory, and while largely independent in practice, UK authorities retain a degree of responsibility and connection with the islands.

The UK's Prime Minister David Cameron has publicly pledged to take action against offshore secrecy and offshore tax avoidance, including in crown protectorates such as Jersey and Guernsey, and overseas territory, meaning further exposure of the role of the BVI could prove a political embarrassment.

The role of major Western financial institutions in establishing offshore structures has also attracted scrutiny, despite being a routine and entirely legal function for many of them.

The ICIJ records show both PricewaterhouseCoopers and UBS had extensive contacts with incorporation agents in the BVI and other territories in the region. In total, UBS helped incorporate more than 1,000 offshore institutions for clients from China, Hong Kong or Taiwan, while PwC had a role in establishing at least 400.

Both PricewaterhouseCoopers and UBS declined to comment on any specifics regarding their activities in the BVI, or with China's rich. However, spokesmen for both companies said their activities complied with appropriate law and ethical codes.

"As a matter of policy, PwC member firms do not comment about clients or their business," said a spokesman for PwC China.

"PwC's tax advisory practice helps our clients make informed business decisions, balance their responsibilities to do the right thing for multiple stakeholders, often across many countries, and meet their tax requirements."

A UBS spokesman said: "We operate to the highest standards in our business operations to meet all our legal and regulatory requirements."

The amassed wealth and alleged corruption among China's political elite has been a topic of growing interest not only in the Western media, but also — to a limited extent — within China itself.

Spurred on by President Xi's public statements around anti-corruption efforts, a Chinese academic and activist, Xu Zhiyong, inspired a "New Citizens' Movement" in the country — an informal civil society group which among other goals aims to increase the financial transparency of the country's elite and curbing corruption.

The movement, however, has faced strong opposition from Chinese authorities. Numerous participants in the New Citizens Movement have been arrested at public gatherings, while its founder Xu is in prison facing charged of "gathering a crowd to disrupt public order", and faces up to five years in prison. Meanwhile, international journalists who have reported from within the country on the wealth of China's political elite have faced immigration difficulties from the government, or trouble with authorities.

⋅ Read the ICIJ's full report of the latest offshore links.

Photo Credits
Peng Zhen: AFP/Xinhua; Dai Xianglong: Vincent Yu/AP Photo; Deng Xiaoping: AFP/AFP/Getty Images; Hu Jintao: Chris Ratcliffe Pool/EPA; Li Peng: Sportsphoto Ltd./Allstar; Su Yu: public domain; Wen Jiabao: Feng Li/Getty Images; Wang Zhen: public domain; Xi Jinping: Edgard Garrido/REUTERS; Ye Jianying: ChinaFotoPress/Getty Images;