If you are going to do business in the USA you need to understand that the USA is NOT a bigger version of the UK - it is fundamentally different in many ways. And those ways can really leg you up.
The first thing to realise is that the Fifty States in the USA are separate countries - they each have their own system of Government and make their own laws. The reason that Al Capone was brought down by a tax case is that Tax Evasion in the USA is a Federal crime and is prosecuted by the Federal Government in Washington, DC.
He was never going to be convicted of anything in Chicago because he had quite literally bought the entire state of Illinois. All the police, judges and every form of State government was under his control. If you followed his rules you got big dollops of cash and if you did not you were a dead man walking.
So he was totally immune from arrest and conviction in Illinois but if you cause enough waves the pressure of public opinion (ie votes) will force the Feds to do something.
And even in those days there was plenty they could do but the easiest was tax - so they did him on that. He could not account for the source of his vast wealth so that was it.
Had that failed there was always the Mann Act - carrying a woman across state lines for immoral purposes. Or using the telephone, telegraph or mail for criminal purposes. All Federal as opposed to State offences.
These days they would have used the RICO Act (Racketeer Influenced and Corrupt Organizations Act) - no coincidence that RICO sounds Italian.
In the UK a lawyer will temper his bill depending on circumstances - if the matter is trivial they may not even charge you if you are a well established client. Not in the USA - if you ask them the time they will charge you.
If you are selling buildings or land you can just agree a deal and then the buyer will happily sign a binding contract on the boot of the car
I once asked my lawyer in Georgia why that happened and she replied "because we make more money sorting out the ensuing mess than if we had been involved from the start"
In 1981 I was carrying out a development of 350 condominiums in Florida when I was sued by somebody for $3m. He registered a 'Lis Pendens' (lawsuit pending) against my property. When I asked my lawyer what that meant he replied "it means that you are totally paralysed - you cannot sell or do anything until the action is heard in court in maybe two or three years time"
Oh dear. If you want to know how this ended see here. No, I did NOT go bankrupt but it was close.
You may imagine that the land of the free is free of bureaucracy - far from it. And these people have draconian powers. I was once talking to a friend of mine in Atlanta, Georgia while he opened his mail. Suddenly he started cursing loudly. When I asked what had happened he replied that the IRS (Internal Revenue Service) had totally emptied his bank account - just like that. No warnings - if you do not pay on time they just help themselves.
In many states to carry out a business you need a licence and if you don't apply they can charge you $100 per day or more. So when you discover this two years after you open for business what do you do? Answers on a postcard please.
If you live in a State for more than a few months you are supposed to apply for a driving licence - be careful
I once was involved in a minor crash and summoned to court where the black female judge looked up and gave me a big grin and said "I am suprised to see you Mr Cory I would have expected you to have flown home by now" and she fined me $50 which I thought was very decent of her. Thank you, Your Honour, I appreciate it. I turned up because I did not want to be on some form of black list.
So it is not all bad news but you really do have to be careful - avoid the temptation of being a smart ass.
These vary from State to State but are typically just over 1% of the value but can go up to 2% in some states - so $20,000pa on a $1m house
In some states in the USA if you do not pay your property taxes you may find that your $500,000 house has been sold for $100,000 on the steps of the courthouse to recover the debt.
In 1987 I was living in Smyrna, Georgia (a suburb of Atlanta) just down the road from Julia Roberts who was at school at the time. Unfortunately we never met. Maybe one day.
At the time, there was an ongoing love affair between President Ronald Regan and Maggie Thatcher who was in a certain amount of electoral difficulty. It occurred to me that if I ran around the USA raising $20m for Maggie I could take a 10% commission (it is well established in the USA that fund rasiers take a percentage and nobody seemed to find this a problem) and also get a Knighthood ("arise Sir Robert").
So I got an introduction to a well connected lawyer S John Byington who was a partner in a firm of K Street lawyers called Pillsbury Madison & Sutro. John had direct connections to President Ronald Regan eg see President Regan's Appontments to Office.
The streets in central Washington, DC are named A to W and 1 to 63. K Street is so famous in the USA that the term K Street Lawyer means "an expensive lobbyist".
Obviously the key here was deniability "this idiot Cory is nothing to do with us" if it all went wrong.
Before I knew it was in a big room with a couple of US Senators and a lady who was Ronald Regan's personal reperesentative. Afterwards she came over to me and said "The President really wants this to work - keep in touch"
The stumbling block was that in the USA at the time it was illegal for a US Candidate to collect money from overseas and the Americans could not believe it was legal in the UK (it was then but not now). So they opened a dialogue with the Conservative Party who not only replied that it was legal but told me privately they had even had money from the Government of Communist China!
At one point during all this I was sat in the reception of Pillsbury Madison & Sutro when John Byington wandered in with a guy and said "this is Sandy, he is a political consultant". So I politely chatted to Sandy for a few minutes about politics and then went in to see John.
Yup - you've guessed - a week later I got an invoice for $1,000 from Sandy for political consultancy - I am sure John was unaware of this and I never told him.
But all this took time and then suddenly Maggie announced an election in June 1987, swept back into power and my plan was history. Another one that got away.
Bob Cory
Modified on 25/07/2023 at 12:27:31 by ℗ Bob Cory