Irony: Obama’s Treasury Nominee Has Cayman Island Holdings

Posted by on Feb 09, 2013 at 4:56 pm

The president blasts those who move money offshore (remember Mitt Romney, anyone?, so why the heck is he nominating a guy to head the Treasury Department who does the same?

Congressional Republicans are raising new questions about the Treasury nominee’s offshore financial holdings.

Congressional Republicans are targeting Jack Lew’s nomination to lead the Treasury Department, raising new questions about the former White House chief of staff’s Cayman Islands financial holdings.

In a statement Friday, Sen. Chuck Grassley (R-Iowa) blasted the White House, saying “the irony is thick” after President Obama has voiced criticism over the use of offshore accounts to avoid taxes.

But the White House argues that Lew’s financial holdings had been fully disclosed during his three previous confirmation hearings and that all appropriate taxes had been paid on the foreign holdings.

Moreover, it appears that Grassley and other Republicans have supported at least one other nominee — Bush Treasury Secretary Hank Paulson — who had extensive financial holdings in the Cayman Islands.

At issue is an employee investment fund based in the Cayman Islands that Lew bought into during his time working at Citigroup before entering the Obama administration. In a release Friday, Grassley argued it was hypocritical of Obama to have nominated a candidate with such an offshore investment despite having railed against tax avoidance schemes based in the Caymans.

“President Obama has been almost obsessively critical of offshore investments,” Grassley said. “He called Ugland House ‘either the biggest building or the biggest tax scam on record.’ ”

The Ugland House is a building in the Cayman Islands that serves as the legal address for thousands of corporations seeking favorable tax breaks. In a 2009 speech, Obama called the use of the adders “the kind of tax scam that we need to end.”

Obama sure would know about scams.

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