How Fox News Could Improve their Coverage of the Netanyahu Corruption Cases

Fox doesn't tell us how much these tax breaks Netanyahu granted to two billionaires are worth

This week, Israeli Prime Minister Benjamin Netanyahu was charged in two corruption cases. If you browse the coverage on different news sites, you will see that not all news sites provide their readers with enough information to fully understand the scale of corruption involved.

Fox News does a good job of providing some of the details, but I think it is critical that Fox tell their viewers what kind of  “tax break” Netanyahu allegedly gave to these two billionaires.

Some of the details sound innocuous and are likely to mislead readers.  By providing fine detail about what Netanyahu received, but without descriptions of what Netanyahu is alleged to have given in return, readers may be left with the misimpression that this case is much ado about cigars and wine between friends.

In reality a Netanyahu is alleged to have arranged to give these two billionaires a 10-year exemption from paying income taxes, which you can imagine works out to a HUGE amount of money for the two billionaires. Fox describes it as as if it were a generic “tax break”.  For all we know, Netanyahu is accused of allowing these two billionaires a higher child tax deduction credit.  Here’s Fox’s description:

It said Netanyahu had accepted gifts valued at 750,000 shekels ($214,000) from Milchan, and 250,000 shekels ($71,000) from Packer. The gifts from Milchan reportedly included expensive cigars and champagne. Police said that in return, Netanyahu had operated on Milchan’s behalf on U.S. visa matters, legislated a tax break

and connected him with an Indian businessman. It said he also helped Milchan, an Israeli producer whose credits include “Pretty Woman,” ”12 Years a Slave” and “JFK,” in the Israeli media market.

The Times of Israel does a better job of detailing the “tax break” which Netanyahu is alleged to have legislated — a 10 year exemption from income taxes, that Netanyahu tried to extend to 20 years.  For a billionaire, a 10-year income tax exemption is worth a HUGE amount.  As you will read, the tax break in question generated a large amount of corruption, including money laundering for the international drug trade.  The Israeli state comptroller tried to close these loopholes, starting in 2014, but every year, the legislation closing these loopholes was thwarted by Prime Minister Netanyahu’s government.

From The Times of Israel:

Benjamin Netanyahu, 2012

Amendment 168 grants a 10-year tax exemption on income earned abroad to new immigrants as well as to returning residents who have lived abroad for at least 10 years. In addition, the amendment gives those eligible a 10-year exemption on reporting earnings abroad.

Police now believe, based on the testimony of former finance minister Yair Lapid, that Netanyahu sought unsuccessfully to extend the exemption to 20 years, on behalf of Milchan and Packer.

“The idea was to encourage aliyah to Israel of wealthy people by turning Israel into a tax haven,” Snir told The Times of Israel last year. “The new law definitely gave a nudge and a wink to people who had dirty money and wanted to launder it.”

Under the right circumstances, a beneficiary of the law can end up paying no income tax whatsoever. The law has been taken advantage of by many individuals involved in the online gambling, forex and binary options industries, who typically will register their company in places like Cyprus or the British Virgin Islands and therefore pay no taxes on income from their enterprise, as long as the ultimate beneficial owner is a new immigrant or returning resident. What’s more, when foreign law enforcement officials seeking to investigate such alleged criminals turn to their Israeli counterparts, the authorities here may not be able to provide them with information on their finances.

Israel has consistently been one of the world’s top destinations for millionaires for the past several years — many of them from France.

But the law has attracted criminals as well.

Several thousand French new immigrants to Israel are said to be making their living working in boiler rooms and perpetrating various types of scams against victims abroad. More than ten thousand Israelis, many of them new immigrants, are employed in such fraud industries, which include fraudulent online gambling, binary options, CEO scams, forex, diamond scams, cryptocurrency scams, lead-generation scams and many others.

Alarmed that Amendment 168 was giving rise to increased criminality in Israel, Israel’s state comptroller in 2014 decided to do a random sampling of the bank accounts of new immigrants who had moved to Israel between 2008 and 2012.

One hundred of 600 bank accounts, or one in six, were found to have irregular activity that caused the bank to flag them for suspected money laundering.

Each year since 2014, a provision canceling the reporting exemption has been placed before the Ministerial Committee for Legislation as part of the Economic Arrangements bill. Each year, the minister of immigrant absorption — first Sofa Landver (Yisrael Beytenu), then Ze’ev Elkin (Likud) then Landver again — negotiated to have the provision removed from the bill before the other ministers could even vote on it. Last week, the provision was once again removed from the Arrangements Bill.

the US State Department, Israel is listed as a “a major money-laundering country,” the most egregious of three categories, which it defines as one “whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking.”

It sure sounds like a “swamp”.

Read the whole thing: The Times of Israel