The Catholic Tax Haven

THE GREAT DERATIZATION

By Matthew Temme

Over the years I have continued my research on Fribourg from afar. I have seen Kleptocrats, like Ferinand Marcos, Pavel Lazarenko, and Teodorin Obiang use the Catholic city to defraud their poor compatriots. I have seen financial fraudsters such as Bernie Cornfeld and Vincent Lacrois who have destroyed people’s pensions set up business in the Zaehringan’s “Free City.” I have also seen traffickers in chemical and nuclear weapons such as Hans-Joachim Rose and Safa Haboby quietly establish their evil operations under Fribourg’s black and white flag. Even union-bashing coal-mine owners from Canada and the United States, such as the notorious Clifford Frame from Nova Scotia and the wealthy Drummond family from Alabama, the very culprits that Pope Leo XIII was so critical of in the 19th century, have set up shell operations in the shadow of Fribourg’s beloved St. Nicholas Cathedral. (See Rerum Novarum #42 @ www. papalencyclicals.net/Leo13/l13rerum.htm)

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THE UNDERGROUND ECONOMY

 By Matthew Temme

Yesterday , the 20^th of November, 2013, I shook Oliver North’s hand. Col. North was signing copies at a local Costco of his inspirational book about recently injured and killed soldiers: American Heroes on the Homefront. The subtitle to the book is The Hearts of Heroes, and indeed our hearts go out to the young families depicted in the book who are valiantly dealing with the deaths and terrible injuries of their loved ones. The numerous pictures of smiling soldiers whose bodies have been devastated by war, but whose spirits still soar are lessons to us all. Our little troubles pale in comparison. Col. North should be commended for the work he has done on behalf of these gallant warriors and their families. At the beginning of his book, he writes that “Heroes are people who place themselves at risk for the benefit of others.” (p.xi) I think this is about as good a definition of the modern usage of the word “hero” as any lexicographer could devise.

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BOESKY THE RAT

 by Matthew Temme

We got back to the USA in time for my hometown’s July 4^th parade. Hurrah!  In November, my Swiss lawyer friend sent me the “Interpellation” (formal question) he had asked the Fribourg State Council (Conseil d’État). In it he noted that in 1985/1986 Boesky had paid taxes on a revenue of 304,200 francs, and bank holdings of 3,500,000 francs. My friend found it hard to believe that a man who had paid a $100 million fine to the US government had declared so little income in Fribourg which as a permanent resident was supposed to be the center of his professional life. In December, the Fribourg government replied that it could not require Boesky to pay taxes on his American income because of a treaty about double imposition it had with the United States. So under the rug went the whole Boesky affair.

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SEE NO EVIL

 by Matthew Temme

The day after I sent the letter-to-the-editor, during a free period, I walked down the cobble-stone lane from my school to the office of a friend who was a lawyer and cantonal senator (deputé). He was very interested in the Boesky family’s Fribourg residency. He said that he would inquire into Boesky’s Swiss finances and taxes, especially since the convicted arbitrageur had already paid an astronomical fine of $100 million for insider trading and was currently cooperating with the US Government while awaiting sentencing. That afternoon, La liberté called and said they would publish my letter. They also asked if I would sit down with one of their reporters who was helping the celebrated investigative journalist Roger de Diesbach write a long article on Boesky. Later, Diesbach would claim that he had learned about Boesky’s Fribourg connections from someone in Lausanne who had also seen the feature on the Jehovah’s Witnesses in La Liberté, but I always suspected that his source was my journalist friend in the US who had curiously never responded to my phone message.

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SAINT PETER CANISIUS

by Matthew Temme

Students and teachers of St. Michael’s College in the 1970’s. I am on the far left.

May 8th, the day on which my letter about Boesky and Iran-contra  was published in the local newspaper, was also the birthday of Saint Peter Canisius. It was a day charged with symbolism for the Dutch saint. It was on this day that he was admitted to the Society of Jesus (the Jesuits) in 1543. This was also the day set aside by the Church as one of St. Michael the Archangel’s feast days. Canisius, who venerated the Archangel, had named our school “St. Michael’s College.” There were paintings and statues of St. Michael killing reptilian Satans all around our college. I always thought that it was my destiny to teach at the last of the many schools that Peter Canisius had founded because my great-uncle had graduated from Canisius College in Buffalo, NY.  He took the name “Matthew” when he made his final vows as a Dominican monk. This is the name that my mother chose for me in honor of her favorite uncle. In 1982, when our school celebrated the 400^th anniversary of its founding by the great Jesuit, I made a video film in which “Canisius” was the unseen narrator. The final shot of the film was of the imposing statue of our founder in our school’s interior courtyard, taken from a helicopter which I had rented with several friends. The film was shown to hundreds of visitors who took the guided tour of the college during the festivities.

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The Law of Silence

Fribourg falls asleep in its covers. Audifi SA tucks in Irangate. La rue de l’Industrie keeps a vigilant eye on the contras. Silence lulls Secord and Hakim to sleep. The bloody countryside of Maurice Demierre doesn’t intrude on the dreams of Madame Hefti. But as the new day begins, Lake Resouces scrambles to save the contras.

All’s well in the best of all possible worlds. No good news disturbs the peace in Fribourg: only the rich get loans; only millionaires get refuge.

Beauregard 9 shelters Boesky. “Ivan the Terrible,” who graced the cover of Time, finds sanctuary right here, in Fribourg. Sleep well, all those who hide in the Catholic citadel.

Fribourg is a dormitory without nightmares. Its protection is the silence of its peaceful nights. Its strength is its chronic…deafness.

This letter appeared in La Liberté five days later on Friday, May 8^th, 1987 (p.13).

next time; St. Peter Canisius

La loi des silences           

Monsieur le rédacteur,

Fribourg s’endort dans ses couvertures. Audifi SA borde L’Irangate. La rue de l’Industrie vielle sur la contra. Le silence berce Messieurs Secord et Hakim. Le paysage sanglant de Maurice Demierre n’atteint pas les nuits de Madame Hefti. Alors que, le jour venu, on négocie avec Lake Resources le sauvetage, in extremis, de la contra.

Tout est pour le mieux dans le meilleur des mondes. Aucune bonne nouvelle ne vient troubler l’ordre fribourgeois : on ne prête qu’aux riches. On ne donne asile qu’aux millionnaires.

Beauregard 9 accueille Boesky. Yvan “le terrible”, qui fait la une du “Time” trouve le plus innocent des refuges, ici, à Fribourg. Dort bien qui se cache dans la cité catholique.

Fribourg est une ville-dortoir sans cauchemar. Son arme : le silence des nuits paisibles. Sa force : une surdité accrue.

Matthew Temme

SWISS FAMILY BOESKY

 by Matthew Temme

Boesky’s building in Fribourg

The persistent indifference of the Fribourgeois to the corruption in their midst was brought home to me a few weeks after the Q & A session with the bishop. One of the photographs illustrating an article in the local newspaper on a Fribourg chapter of Jehovah’s Witnesses showed a long row of silver nameplates in the entranceway to the chapter’s headquarters. Four slots above  the Jehovah’s Witnesses nameplate was a nameplate for the “Boesky Investment and Financing Corporation.” (La Liberté, Saturday, May 2, 1987)  When I saw the picture, a bell rang in my head. I dug through my collection of old Time magazines, and there on the cover of the December 1, 1986 issue was Ivan Boesky, the notorious insider trader, sporting a cadaverous grin. The headline was “Wall St. Scam: Making Millions with Your Money.”

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DEFINITELY NOT A “PLAQUE TOURNANTE”

 by Matthew Temme

Before I left the Collège St. Michel in 1987, I was interviewed by a student “valete” (graduation) magazine. Though I never talked about local money laundering during my lessons, in this farewell interview, I warned the students of the explosive role that illicit money could play in society (Le Libretto: Journal official du Valete, “Ce n’est qu’un au revoir,” 1987, p. 9-13)   That was 26 years ago; those young people are now approaching 50. Predictably, nothing has been done. There has been no popular revolt. The “open secret” of Fribourg’s complicity in the world’s shady underground economy remains underreported. Every decade or so a major scandal bubbles over and is briefly chronicled in the local press. These articles always try to minimize Fribourg’s responsibility in the scandals, claiming that the little city does not have the sophisticated resources to investigate such devilish schemes. Usually a headline or side-bar indignantly announces that Fribourg is definitely not a hub (“plaque tournante”) of white-collar crime! (see above-mentioned “Soupçons de lessivage sur Fribourg ”). Astonishingly, the names of the Swiss business people who have fostered these unholy deals are never mentioned. It is as if these lawyers, accountants, and fiduciary agents have been granted immunity (see “Les 2200 sociétés boîtes aux letters du canton de Fribourg demeurent mystérieues,” La Liberté, 11/4/2000). 

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THE GOOD BISHOP

by Matthew Temme

The Iran-contra connections to Fribourg frightened and angered me. No one seemed to care. The locals, even the American expatriates, were mute. I was afraid for my children. I did not want them to grow up in a town where people walked around wearing blinders. Suspecting that Iran-contra was just the tip of the iceberg, I began to look into company formation records at the town’s public registry of companies. The person in charge there was a former student. He was surprised at the amount of time I was spending going through the office’s files. Needless to say, I discovered many suspicious companies.

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By Matthew Temme

It made me sick to think that the Swiss town where I had lived and taught school, attended university, owned a home, and raised a family was at the center of this sordid “Iran-contra affair” which blatantly violated the constitutional safeguards that guaranteed the United States’ principle of the separation of powers. The Swiss Constitution of 1848 was based on the American Constitution. Why then were the Swiss so eager to help Americans do what they would never do themselves? This affair only increased my resolve to leave Switzerland. The previous summer, my wife and I had decided that we would leave her home town and return to my bithplace in Pennsylvania where we had lived when we were newlyweds  in 1968. Even though I had tenure at the canton’s premier lycée, and we had recently put an expensive addition onto our house, we decided that we had to leave Fribourg—at least on a leave of absence.

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By Matthew Temme

Audifi SA, Rue de L’industrie 16, Fribourg (6th floor)

IRAN-CONTRA

In 1986, when Fribourg first burst onto the international scene in the December 15^th edition of Time magazine, it was spelt in the German way. An article entitled “Pursuing the Money Connections,” traced intriguing Iran-contra connections to Geneva and “Freiburg.”(p.13) The Time article described a nebulous relationship between the Iran-contra arms dealers and “Freiburg.” After reading it, however, I was still not sure (because of the spelling) whether the author was referring to the Swiss or the German city.

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