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As Defense Budget Soars Security Firms Reap Huge Profits, Go Offshore to Avoid Taxes

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Tom Burghardt
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Accordingly, CSC "develops and integrates automated tools for unique requirements of specialized intelligence analysts." Tools that enable secret state agencies to "Capture and mine information from multiple sources in multiple languages; Collaborate in real time with fellow analysts; Create models in which to store working data and test hypotheses; Discover insider threats by tracking network behavior; Automatically analyze and visualize complex data using intelligent software agents."

As with hundreds of other firms who trade top secret security clearances as if they were trading cards, CSC provides "experienced, cleared intelligence professionals who perform intelligence analysis, database construction and population, editorial support and quality assurance, production and collection management, analytic tradecraft training, on-the-ground acquisition of unique data sets, and foreign language support."

Conveniently, CSC has some 1,200 employees who they rent to the secret state at a premium price "who meet DCID 6/4 eligibility requirements and have access to Sensitive Compartmented Information (SCI) or Special Access Programs (SAPs)," i.e., Pentagon, CIA and NSA "black programs" only known by code words that escape congressional scrutiny, or indeed any democratic oversight.

The firm's "Information Refinery" is touted as an "innovative approach to open source intelligence that captures multilingual information from the Internet and other publicly available sources, then mines, refines and translates it for use by government intelligence analysts and decision makers."

Translation: CSC, on behalf of secret state "stakeholders" surveil web pages, blog posts and other electronic communications and "assist" spooks in transforming data, including First Amendment-protected free speech into grist for the "actionable intelligence" mill.

One would think a red-blooded, patriotic American firm like CSC would do their all for "God and Country," and pay their fair share of taxes, considering the billions of dollars in contracts the firm has speared from the government. Think again, chumps!

GAO reports that CSC has 21 subsidiaries "in jurisdictions listed as tax havens" by the federal government. Some of the firm's global operations are located in tech manufacturing powerhouses such as Bermuda (1); British Virgin Islands (4); Costa Rica (1); Hong Kong (5); Ireland (2); Luxembourg (2); Macao (1); Singapore (4); Switzerland (1).

Despite the fact that "DOD officials were aware of the roles offshore subsidiaries played in the DOD contracts we reviewed," GAO investigators found that "contracting officials stated that the use of offshore subsidiaries did not negatively impact contract schedule or performance."

After all, $708 billion does a lot of talking!

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Tom Burghardt is a researcher and activist based in the San Francisco Bay Area. In addition to publishing in Covert Action Quarterly and Global Research,, his articles can be read on Dissident Voice, The Intelligence Daily, Pacific Free Press and (more...)
 
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