Newspaper article International New York Times

Paulson Company Closing amid Tax Scrutiny

Newspaper article International New York Times

Paulson Company Closing amid Tax Scrutiny

Article excerpt

The Bermuda-based company, PacRe, was set up in 2012 by the hedge fund manager John Paulson, but it has stopped writing policies.

The Bermuda-based reinsurance company set up by the hedge fund manager John A. Paulson is winding down as scrutiny of offshore tax strategies rises.

The company, PacRe, which Mr. Paulson set up in 2012, has not been writing policies since Jan. 1, according to a statement Tuesday evening by Validus Holdings, a Bermuda reinsurance company that did the PacRe deal with Paulson & Company.

It is one of a few Bermuda reinsurers set up by hedge funds in recent years. The managers have been using a strategy that gave more favorable long-term capital gains tax treatment on trading profits if they moved their investments through an insurer based in a low- tax jurisdiction such as Bermuda.

The strategy has attracted criticism in Washington, and lobbyists have been fighting proposals to tighten the rules. …

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