Posted on 04/16/2021 3:01:06 AM PDT by Liz
An investment firm linked to Hunter Biden received over $130 million in federal tax dollar bailout loans while his father Joe Biden was vice president...... profits were routed through a subsidiary in the Cayman Islands, according to federal banking and corporate records reviewed by the Washington Examiner.
Financial experts said the offshore corporate structure could have been used to shield earnings from United States taxes.
Rosemont Capital, an investment firm at the center of Hunter Biden’s much-scrutinized financial network, was one of the companies approved to participate in the 2009 federal loan program known as the Term Asset-Backed Securities Loan Facility, or TALF.
Under the program, the US Treasury Department and the Federal Reserve Bank issued billions of dollars in highly favorable loans to select investors who agreed to buy bonds that banks were struggling to offload, including bundled college and auto loans.
According to federal records, 177 firms participated in TALF, many of them well connected in Washington or on Wall Street. For investors, there was little risk and a high chance of reward. The Federal Reserve funded as much as 90% of the investments. If the bonds were profitable, the borrowers benefited. If not, the department agreed to take over the depreciated assets with no repercussions for the borrowers.
“It’s very complicated to become qualified as a TALF borrower or as a TALF fund, if you will,” Carol Pepper, a wealth management specialist, told Forbes in 2009. “But that’s an example of where, if you can get into a TALF fund, you can benefit from this government program.” Under the terms for the program, any U.S. company looking to invest in select categories of bonds was eligible to apply for the loans. However, the Treasury Department and Federal Reserve maintained the “right to reject a borrower for any reason,” and the internal selection process was criticized by some lawmakers as opaque and open to corruption.
“How can my constituents in Vermont get some of that money? Who makes the decisions? Do you guys sit around in a room — do you make it? Are there conflicts of interest?” Sen. Bernie Sanders asked Federal Reserve Bank Chairman Ben Bernanke at a March 3, 2009, Senate hearing. “Do you have to be a large, greedy, reckless financial institution to apply for these monies?”
Joe Biden was a key advocate for the financial bailout, which was approved under the Bush administration and expanded under President Barack Obama. He delayed his Senate resignation in January 2009 to cast his final vote to increase funding for the Troubled Asset Relief Program before taking office as vice president.
“These guys are not the most likable guys in the world,” Biden said about the banks and hedge funds aided by the government intervention. “But here are the facts ... Had we not bailed out the largest bank institutions in the world, there would have been a flat-out depression.”
One of the firms that benefited was Rosemont Capital, a company led by Hunter Biden’s business partners, Chris Heinz (John Kerry's stepson) and Devon Archer. The firm received the loans at a crucial time for Hunter Biden. The younger Biden had stepped down from his lobbying business in late 2008, reportedly due to pressure on his father’s vice presidential campaign.
Biden, Heinz, and Archer incorporated Rosemont Seneca Partners in Delaware on June 25, 2009. The “alternative investment and market advisory firm” was an offshoot of Rosemont Capital, which held a 50% stake in the new venture. Rosemont Seneca and Rosemont Capital shared the same office address in lower Manhattan and the same New York phone number, according to Securities and Exchange Commission documents.
Three weeks after Rosemont Seneca was incorporated, a subsidiary of Rosemont Capital called Rosemont TALF SPV, received $23.5 million in federal loans through the TALF program. This included $13.4 million to invest in student loans and $11.1 million to invest in subprime auto loans. Over five months, the company received a total of $130 million from the program in multiple installments for investments in subprime credit cards and residential mortgages.
“This is a great example of the suspicion of many Americans that these bailouts were used to benefit connected insiders while ordinary Americans went broke,” said Tom Anderson, director of the Government Integrity Project at the National Legal and Policy Center, an organization that was critical of TALF at the time.
Although the government stopped issuing the loans at the end of 2009, the names of the well connected borrowers and investors were later released — prompting new criticism from lawmakers and the press. In April 2011, Rolling Stone reported that millions in TALF loans had been issued to the wife of Morgan Stanley Chairman John Mack, Miami Dolphins owner H. Wayne Huizenga, and Wall Street titan John Paulson, dubbing the program “welfare for the rich.” “Our jaws are literally dropping as we’re reading this,” Warren Gunnels, an aide to Sanders, told Rolling Stone. “Every one of these transactions is outrageous.” Sanders also raised concerns that borrowers were using the program to evade taxes. His office staff compiled a list of over 100 TALF investors based in the Cayman Islands and other known tax havens.
“It has been estimated that each year corporations and wealthy individuals avoid approximately $100 billion in U.S. taxes through the use of abusive and illegal tax shelters,” wrote Sanders in a letter to Bernanke. “Why would the Fed lend to material investors located in the Cayman Islands?”
Federal Reserve records show Rosemont Capital was one of the companies that set up an offshore limited partnership, called “Rosemont TALF Investment Fund LP,” to participate in the TALF program. The fund was incorporated in the Cayman Islands on May 14, 2009, and dissolved on Nov. 14, 2014, according to corporate records in the British territory. The fund was managed by a Delaware-based subsidiary of Rosemont called “Rosemont TALF GP,” SEC records show.
Another investor in Rosemont’s TALF fund, called “Rosemont TALF Opportunities Fund II,” was also based in the Cayman Islands. Additional Rosemont TALF investors included two Greek shipping magnates, a California class action attorney and a financial trust based in Liberia.
Tax experts said the Cayman Islands were a popular location at the time for hedge funds and corporations to set up subsidiaries in order to avoid paying certain U.S. taxes. Didier Jacobs, a senior policy adviser at Oxfam America who focuses on international finance, said an estimated $2.7 trillion was parked in the Cayman Islands and other tax havens prior to the U.S. tax reform in 2017. “As long as it was sitting there, it was not taxed. That’s why there was a lot of money sitting there in the Cayman Islands,” said Jacobs.
Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center, said the use of an offshore company could also help investment firms reduce the tax liability for foreign or tax-exempt investors who could otherwise be subject to U.S. taxes.
Matt Gardner, a senior fellow at the Institute on Taxation and Economic Policy, said the most likely reason for setting up a company in the Cayman Islands would be to take advantage of its tax laws. “It seems like a pretty basic ask that any recipient of these TALF loans would act in a certain ways. And one of those ways would be to not organize their businesses to avoid taxes in the Caymans,” said Gardner.(More on TALF below)
THE TALF SCAM UP CLOSE: Federal records say 177 well-connected (read politically-connected) firms participated in TALF.
For those investors, there was little risk w/ rewards guaranteed. The Federal Reserve (read taxpayers) funded as much as 90% of the investments.
If bonds were profitable, the borrowers benefited. If not, the department took over the depreciated assets with no repercussions for borrowers.
Then-Sen Joe Biden was a high-profile, key advocate for the financial bailout, which was expanded under Obama.
Biden even delayed his Senate resignation in Jan 2009 (prior to taking the VP office).
Biden cast his final Senate vote to increase funding for the TALF Program (in which his son stood to profit handsomely) before taking office as vice president.
Biden said about the banks and hedge funds aided by the government intervention. “Had we not bailed out the largest bank institutions in the world, there would have been a flat-out depression.”
Depression. Joe concocted the perfect cover to make sure his son profited. Wonder what Joe’s cut was?
wonder how many other UniParty families have benefited...
Official federal records say 177 well-connected (read politically-connected) firms participated in TALF.....they’re all in there, grabbing.
and thats JUST TALF...
the reasons behind the Uniparty coup become clearer daily
tnx Liz
Lord this crap makes me sick. And to think how the rest of us struggled to stay afloat through that stretch of obama ahministration.... 8 loooong years
now 4 more/ somebody pinch me.
btt
And NOTHING, ABSOLUTELY NOTHING will happen to him OR John Kerry’s step son....NOTHING BECAUSE THEY ARE DEMOCRATS!!
The Department of Just Us,which is now busy sending all those armed insurrectionists away for life,will get right on this!
It appears that the favorite loan recipients were rewarded with interest on bonds while not even risking only 10% of the downstroke on those bonds. Nice leverage! Nice deal!
No risk Government loans to buy government guaranteed bonds.
Let's see, in order to fund government bonds issued to bailout auto and student loans the government loaned money to companies owned by individuals like Hunter Biden to the tune of 90% of the money needed to buy these bonds. Presumably, 10% had to be put up by the companies but I see nothing that tells me that there was any liability, personal or otherwise, owed by the company in repayment of the loans. In fact, the contrary is the case: "If the bonds were profitable, the borrowers benefited. If not, the department agreed to take over the depreciated assets with no repercussions for the borrowers."
Also presumably, after the investors were paid off their initial 10% investment (if they actually had to put that money up) the rest was gravy. With leverage the VIG between interest from the bonds and interest on the loans could be very handsome indeed.
I suspect that the bonds that were purchased with these loans were already substantially discounted perhaps increasing leverage.
The article also says that it's difficult to get these loans but the pattern shows that they went to cronies. What other conclusion can we reach: we are seeing crony capitalism on the hoof?
The obvious answer is that 10% was not designed to qualify investors but to disqualify everybody but cronies..
One of the firms that benefited was Rosemont Capital, a company led by Hunter Biden’s business partners, Chris Heinz (John Kerry’s stepson).
Hacks know to use family as a front man for their money scams note how many democrat millionaires in congress and senate.
Always looking out for the little guy (not to catch on).
Hunter Biden’s memoir that he seriously entitled, “Beautiful Things,” is the calculated modus operandi of someone determined to obliterate his past.
Joe Biden is moving hell and high water, desperate for Hunter to whitewash his past sins, to make him palatable for....say....elective office.
REALITY CHECK: Replacing one’s errant past w/ a concocted narrative is a practice commonly used among the criminal element.
"Hunter, what's the number of our TALF offshore bank
account? I need a couple million for my campaign."
An investment firm linked to Hunter Biden received over $130 million in federal tax dollar bailout loans while his father Joe Biden was Obama's vice president...... profits were routed through a subsidiary in the Cayman Islands, according to federal banking and corporate records reviewed by the Washington Examiner. Financial experts said the offshore corporate structure could have been used to shield earnings from United States taxes. Rosemont Capital, an investment firm at the center of Hunter Biden’s much-scrutinized financial network, was one of the companies approved to participate in the 2009 federal loan program known as the Term Asset-Backed Securities Loan Facility, or TALF.
Under the program, Obama's US Treasury Department and the Federal Reserve Bank issued billions of dollars in highly favorable loans to select investors who agreed to buy bonds that banks were struggling to offload, including bundled college and auto loans.
According to official federal records, 177 firms participated in TALF, many of them well connected in Washington or on Wall Street. For investors, there was little risk and a high chance of reward. Obama's Federal Reserve funded as much as 90% of the investments. If the bonds were profitable, the borrowers benefited. If not, the department agreed to take over the depreciated assets with no repercussions for the borrowers.---SNIP---rest on FR
"Hunter, what's the number of our TALF offshore bank
account? I need a couple million in a hurry."
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