ICYMI: How Hovde Cashed In On Offshore Insurers

Mar 14, 2024

ICYMI: How Hovde Cashed In On Offshore Insurers

MADISON, Wis. — A bombshell new report from Politico Influence detailed how Eric Hovde profited from tens of millions of dollars worth of investments in offshore, Bermudan reinsurance companies that were set up to dodge U.S. taxes.

The report details how Hovde, as the president and day-to-day overseer of Hovde Capital’s investments, invested upwards of $74 million in Bermudan reinsurance companies that offshored for the purpose of not paying taxes in the United States.

Politico Influence: How Hovde Cashed In On Offshore Insurers
By: Daniel Lippman

  • HOW HOVDE CASHED IN ON OFFSHORE INSURERS: Wisconsin GOP Senate candidate Eric Hovde invested tens of millions of dollars in insurance companies that operated in the U.S. but were based in Bermuda, and therefore benefited from not having to pay U.S. corporate taxes, Daniel reports.

  • Hovde disclosed during an unsuccessful Senate run in 2012 that he had assets worth at least $50 million. He hasn’t filed a personal financial disclosure yet for this campaign, but Hovde has indicated that he will be self-funding his campaign and has suggested that he could spend at least $20 million of his money on the race against Sen. Tammy Baldwin.

  • Between 2003 and 2013, Hovde’s asset management firm Hovde Capital reported non-controlling investments worth up to $74 million in more than a dozen Bermuda-based insurance companies, according to a PI analysis.

  • Bermuda doesn’t have a corporate income tax and has even offered “tax assurance certificates” to ensure holders temporary insulation in the event that ever changes. Every Bermuda insurer that Hovde Capital invested in held those certificates, according to a review of SEC documents.

  • Hovde said in a radio ad during his first Senate campaign in 2012 that it was “wrong” that “major corporations often pay little to nothing in corporate taxes.” He also said in the ad, “We must get rid of corporate welfare, lower tax rates across the board and make the system fair for everyone.”

  • In 2021, Hovde said that he agreed with a Democratic proposal to pass a minimum tax rate for corporations. “This is one I really agree with them on because I’ve always hated it — companies like Goldman Sachs or Apple can put all their technology in offshore places and pay no taxes,” he said.

  • One of Hovde Capital’s top investments was worth $7 million in Bermuda reinsurer Max Re, whose CEO reportedly said that many investors in the company understood that it was “a tax-efficient” investment play and has told investors that the company planned to operate so that it would “not generally be subject to tax” outside of Bermuda. Hovde’s firm also invested in several American companies that moved their headquarters to Bermuda to save on taxes; Bermuda, which has been called “the world’s risk capital,” is the center of the reinsurance industry.