Oklahoma's economic program declared flawed and a scam by 9 other states.
November 12, 2008
"It's a scam." CAPCOs are "flawed beyond repair." said Colorado state Treasurer Mike Coffman.
These programs are a recipe for disaster rather than a catalyst for growth. Daniel Sandler, Faculty at Law, University of Western Ontario.
Those are two of 40 some comments on our website made by independent experts and officials from nine states who where scammed using the same basic economic development scheme (often called Insurance CAPCO. Capital Formation Incentive Act in OK), Oklahoma continues to operate in secret. Those states quickly realizing they had bought a "pig in a poke," when results started coming in, immediately acted to stop the bleeding. But, not before losing $100s million to the scam.
Oklahoma is still losing $100s million per year in future tax revenue funneled directly into the pockets of "secret so called investors" in "secret pass-through entities." Pass-through entities setup by the CAPCO scheme. CAPCOs that serve no useful function other than to take custody of investments on the way to the target business venture long enough to claim 200% of purported investments in tax credits. The program allows tax credits can be sold for cash to pay the huge windfall profits for doing nothing.
"It's a very convoluted and complicated piece of legislation." Julia Rubin, a Rutgers University professor, who studied the CAPCO program for more than four years.
How bad is this scam?
Missouri: 34% percent of CAPCO funds invested in businesses. 66% went into pockets.
Louisiana $600 million into CAPCO. $180 million invested in businesses. 70% or $420 million went into pockets.
Oklahoma $221 million into one CAPCO project, less than 15% or only $32 million invested in business. $34.3 million we learned went into pockets. $189 million is unaccounted for.
** Oklahoma could be growing 7 to 10 times as much new business, at the same cost by cleaning up this program!
Further details and explanations can be found at http://prowlingowl.com/Scams/CAPCO/CAPCO.cfm