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Published: April 4th 2008
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My last posting from the Jamaican cyber café, in 3 parts…
YESTERDAY AFTERNOON
Acephale, acephalos, akephalos, akephale... akefalh, -fali... you name it, yesterday we went through all the combinations. The lady helping me was smirking by now, as if we were never going to find it. But we just tried all the possibilities, until we got to AKEFALO.
“There we are!” she said, as if she was pleased for me. “How do you say that?” and she swung the PC monitor around so that I could read it.
AKEFALO LTD.
DATE OF INCORPORATION 1962
She went off to find the file. A few minutes later I saw her head appear at the back of the room. She was talking to someone else, and from time to time both of them glanced at me, then quickly looked away (I may have been imagining this; it SEEMED like that to me). Around me people were getting ready to leave. Workers were switching off their terminals and collecting their things. It was five o’clock. The security guard on the door started pacing around the public area, as if he was impatient to be gone. I realized I was the only
member of the public still there.
Finally she returned, without the file.
“You’ll have to come back tomorrow,” she said.
“My flight’s tomorrow!” I said.
“Well...” she said, as if there was nothing we could do about it.
But there is something I can do about it. Tonight I’m having dinner with the former director of an offshore bank and his wife, who is an offshore lawyer. They’ll know what to do. And my flight’s not until the evening.
*
YESTERDAY EVENING
I had sushi in the Indigo Cafe on West Bat Street, with two people who have spent their professional lives in offshore, mainly for international banks. They have both seen how things changed on the island over the last three decades.
Historically, the Bahamas had a reputation for secrecy, the Switzerland of the Americas. Secrecy could be bought here. But, as I have already mentioned in a previous post, that all stopped in 2000 when the Bahamas cleaned up its act. Anyone doing business here now has serious KYC responsibility: KNOW YOUR CLIENT.
As I try with intermittent success to convey big floppy pieces of raw tuna to my mouth with improbably
small chopsticks, they explain just how tight the controls here are these days. The Central Bank of the Bahamas has the right to inspect every aspect of your clients’ profiles. If you set up an offshore bank account here, for example, the Central Bank may insist that you lodge a recent utilities bill to prove that your HOME address is legitimate. Your financial transactions are monitored electronically for any strange patterns, and even clerks and low-grade workers can go straight to the Central Bank (by-passing their bosses) if they suspect money laundering or other dubious business is going on.
The Bahamas, it turns out, is about the worst place in the world to keep a secret. And because of that, since the 2000-2001 legislation, many dodgy bank clients and small offshore companies, as well as the management companies that administer them, have simply closed down and moved elsewhere - no forwarding address - typically to islands with looser regulatory frameworks. Sometimes (if you can believe this) they moved to states in the US, most notably Delaware, with strict secrecy laws protecting businesses. Mainly, though, it would be to countries like Panama.
Regarding a company set up in 1962,
they explain to me over the raw fish, it might have been anything: completely legitimate, utterly illegal... It might have scrupulously transparent information lodged in its file, or its incorporation might be based on total fabrication that nobody checked. They tell me to look whether the company is still paying registration fees.
*
TODAY
I rent a car and drive in search of what the Bahamas is really about: VERY VERY RICH PEOPLE. And if you are a tax exile here, there’s only one place to be: Lyford Cay, a gated residential area for multi-millionaires. I have an appointment to meet one of those heavily protected residents, Sheila Hailey, widow of the popular novelist Arthur Hailey, who in the 1970s and 80s was one of the world’s biggest selling novelists, selling some 170 million books (‘Airport’ and ‘Hotel’ were his biggest hits). I need security clearance just to get through the gates.
I look at some of these places, and think back to the wooden shacks that people on the other side of the island still live in. It doesn’t make a great deal of sense...
There’s not a great deal more to say about Lyford
Cay. The houses go for $5 million upwards (and that’s for a small one). Everyone here has servants, and everyone benefits from an income tax rate of zero per cent. Of course, US citizens pay income tax on worldwide earnings, so the presence of so many Americans here is more complex, but you can bet it is not just the sun and sand that attracts Tiger Woods, Nicholas Cage and many others to these shores.
Sheila shows me the office where all those novels were written, with a wall-sized window overlooking a seawater lake, where they used to have a 40ft yacht. I take a few pictures of the area on my way back, but there’s a pretty strong security presence, and I have to snap from the car window as I drive.
Just a few minutes ago, after getting back from Lyford Cay, I made a last-minute call at the Registrar’s offices. My repeated presence is, I think, just edging towards the nuisance zone in there. I ask for the AKEFALO file. I note down the subscriber and director info, although it means nothing to me, and I doubt whether it would do to anyone else
all these years after incorporation. Then I check the fee-paying history of the company with the lady (who is now way suspicious, and is doing that hunching of the shoulders, as if there’s a chill in the air, as if I’m making her uncomfortable). The fees were paid up to 2000, then nothing.
AKEFALO LTD disappeared from the Bahamas just as the time that it would have come under scrutiny. It was simply left on file, and the business itself was almost certainly re-established elsewhere. I know virtually nothing about it, what it did, who owned it, whether it is in any way connected to Acephale or the more recent Headless Ltd. Or whether it is nothing more than a coincidence.
As to where AKEFALO LTD went, now that really is a secret.
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1962
interestingly, 1962 was the year Georges Bataille died...