Sweet music: U2 can avoid higher business taxes

Filed under: Banking & Finance |

It’s not uncommon that when taxes become too high, a business moves to a more favorable climate.

And it now appears that the world of rock ’n’ roll has embraced the principal.

Irish rock star Bono and his band U2 recently moved their business empire from Ireland to Holland to avoid paying the new, higher tax rates that target music royalties.

Bono, who is estimated to be worth more than $700 million, has gained added fame in recent years as a champion for humanitarian causes.

And that has caused him, along with his bandmates, added grief, because he has consistently urged the U.S. government to use its tax dollars to finance other nation’s social programs.

Ah, see how different it is when it’s personal matter, critics sneered.

But, hey, doesn’t becoming one of the most successful rock bands in the world require a shrewd business ethic?

Harsh hand slap for trader

A New York Stock Exchange specialist is facing 27 months in prison and a $250,000 fine for illegal floor trading ahead of customers.

If imposed, analysts say it will be one of the harshest Wall Street sentences handed down in years.

Joseph Bongiorno, a former floor exchange governor, pleaded guilty to the charges, and a U.S. District Court recommended the sentence.

Bongiorno’s trades are estimated to have siphoned about $1.3 million for himself and many more millions for the firms he traded for.

Morgan Stanley layoffs tapering

A summertime Morgan Stanley layoff stint is coming to an end, said the firm’s CFO David Sidwell.

Morgan Stanley reduced its sales force by 110 people between June and August. In 2005, the firm dropped nearly 1,000 of its lowest-producing brokers.

Despite the cuts in the retail brokerage group, Morgan Stanley’s payroll reportedly grew by about 2,500 people during the last year to reach a total of 54,349 employees nationwide.

House gives soldiers investment refuge

The House of Representatives overwhelmingly voted to approve legislation intended to protect military personnel from crooked insurance and investment products salespeople

With a vote of 418-3, the House approved the Military Personnel Financial Services Protection Act and joined the Senate, which passed the measure in June.

The legislation bans the sale of high-priced, contractual mutual funds.

The product has become scarce in the civilian market but was still being offered to soldiers by sales staffs allowed on military bases.

Congressional hearings revealed that life insurance sales were made without informing soldiers that life insurance was available to them through the federal government.

Under the act, disclosures would be required before private life insurance could be sold to military personnel.

A list of barred brokers and agents would be established and made available to installation commanders and state and federal financial regulators.

Deloitte & Touche hire ABA head

The worldwide accounting and consulting firm Deloitte & Touche has hired Donald Ogilvie as an independent senior adviser. Ogilvie is the former president and chief executive officer of the American Bankers Association.

Ogilvie, who worked with the bankers’ trade association in Washington, D.C., for two decades, will assist D&T’s banking and finance industry group.

He’ll advise the firm’s U.S. and global banking and finance industry clients about critical issues facing their industry.

Ogilvie will remain the chairman of ABA International, where he oversees the trade association’s international activities.

Changes at the IRS

The Internal Revenue Service has announced new leaders for its Tax Exempt and Government Entities divisions.

Michael Julianelle will direct the Government Entities division, and Joseph Grant will direct the Tax Exempt division.

Julianelle will replace Preston Butcher, who plans to retire at the end of the year.

Julianelle will oversee the operations of federal, state and local governments, as well as the Indian tribal governments and tax exempt bonds.

The Government Entities section includes 86,000 government employers, representing 20 percent of the American work force that earns about $760 billion annually and pays employment taxes of more than $200 billion.

Grant will oversee the Employee Plans division, which administrates the law affecting more than 1 million public and private retirement plans that have almost $12 trillion under management.

Grant previously was a staff member on the Oversight and Social Security subcommittee of the U.S. House of Representatives’ Ways and Means Committee.

Rob Larimer covers banking and finance for the Colorado Springs Business Journal.