Search warrant executed at Caterpillar offices

3 Federal Agencies Raid Caterpillar Offices

3 Federal Agencies Raid Caterpillar Offices

The Internal Revenue Service, the Federal Deposit Insurance Corp. and the Commerce Department's Bureau of Industry and Security Export Enforcement on Thursday raided Caterpillar's Peoria headquarters and a facility that ships parts overseas.

Stock shares of Caterpillar Inc. fell sharply Thursday as federal authorities searched the USA heavy equipment giant's Peoria, Ill., headquarters and two nearby facilities in what the company described as a tax investigation with billions of dollars at stake.

The U.S. Attorney's Office also confirmed the searches in Peoria, East Peoria and Morton. The company has a parts distribution center in Springettsbury Township.

During the search of Cat's global headquarters building in Peoria, "at least some company employees were directed to the building's cafeteria and were told to remain there and not leave", the Star reports, adding, "those sequestered there include employees in the Treasury, tax and accounting divisions, as well as from executive offices".

Sen. Rand Paul is Hunting for the GOP Health Care Bill
Joe Kennedy and a dozen or so reporters into the room to inspect it themselves to see that it was, in fact, bill-less. House Speaker Paul Ryan wants House committees to mark up and pass an ACA repeal bill as early as next week.

While Caterpillar said on Thursday it was cooperating with law enforcement, it is extremely rare for federal agents to conduct a raid of an enormous American company that is part of the Dow Jones Industrial Average.

A spokesman for the FDIC declined to comment on Thursday's raids.

"Should the full $2 billion charge apply, Caterpillar will likely realize an approximate $3.40 one-time charge and a $.25-.30 run-rate decrease to earnings per share". Under the strategy, Caterpillar transferred the rights to profits from its parts business to a wholly controlled Swiss affiliate called CSARL, even though no employees or business activities were moved to Switzerland, the report said.

In April 2014, a Senate committee put out a report that said Caterpillar had crafted a tax-reducing strategy that shifted billions of dollars of profits away from the Switzerland, where the company had negotiated a low tax rate, even though Caterpillar had not made "any real changes in its business operations". "We now believe that this matter will not have a material adverse effect on the Company's consolidated results of operations, financial position or liquidity", Caterpillar stated according to Forbes.

Recommended News

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.