Tag Archives: pandora papers 2021

News, Observation, Politics

5 Key Things to Know About the Pandora Papers

Above: Photo Collage / Lynxotic

These disclosures about the how the world’s wealthy and powerful hide their vast fortunes will hopefully turn up the heat on the politicians that maintain the wealth-hiding status quo.

This week we are closely watching the disclosures emerge from the Pandora Papers, a massive leak of secret data about the illicit financial activities of the super-wealthy from 200 countries. In the days to come, we will learn more about the tax avoidance of billionaires and the ways states like South Dakota and Florida have become U.S. tax havens.

Here are Five Things You Need to Know:

1. The Largest-Ever Journalistic Collaborative, More Significant Than the Panama Papers 

The Pandora papers are a massive expose about the secret shell games and tax avoidance schemes of the world’s ultra-wealthy, from over 200 countries. This massive undertaking involved 600 journalists from 117 countries and was coordinated by the International Consortium of Investigative Journalists(ICIJ) in what they describe as the “largest-ever journalistic collaborative.”   See initial coverage here in The Washington Post and The Guardian, two of the key media outlets part of the consortium.

Five and a half years ago, the ICIJ released the Panama Papers, which focused on a leak from a single law firm, Mossack Fonseca. According to Gerald Ryle, director of the ICIJ, the Pandora Papers are the “Panama Papers on steroids.” See a summary prepared by the ICIJ here.

The Pandora papers draws on leaks from confidential records at 14 different offshore wealth service firms in Switzerland, Singapore, Cyprus, Samoa, Vietnam, Hong Kong, as well as firms in well-known tax havens such as Belize, Seychelles, Bahamas and the British Virgin Islands (BVI).  These firms help wealthy individuals and corporations to form trusts, foundations, incorporate companies, and establish other entities in low- or no-tax jurisdictions.

The Pandora Papers analyzed 12 million files from these firms including leaked emails, memos, tax declarations, bank statements, passport scans, diagrams of corporate structures, secret spreadsheets and clandestine real estate contracts. Some reveal the real owners of opaque shell companies for the first time.

2. The Global Implications Are Huge and Politicians Will Be Embarrassed 

The Pandora Papers are truly a global story, with major implications for many countries.  Some of the largest revelations involve Russian nationals with connections to Vladimir Putin and elites from Latin America. For example, journalists from the Spanish daily El Pais, exposed the “Secret Vault of Mexican Billionaires.” In Mexico they found over 3,000 wealthy and powerful Mexicans in the 11.9 million leaked files, with connections to current and previous presidents.  They discovered a common pattern of wealthy Mexican elites using a single Panamanian law firm, Alcogal (Aleman, Cordero, Galindo & Lee), along with shell companies and trusts in the British Virgin Islands, and real estate purchases in Miami and around the US. 

The Pandora Papers will hopefully turn up the heat on the politicians that maintain the wealth-hiding status quo. The files list over 330 current and former politicians and world leaders from 91 countries that are implicated in transactions. This is twice the number implicated in the 2016 Panama Papers.

Political leaders include King Abdullah II from Jordan and former British Prime Minister Tony Blair (according to The Guardian, Jordan blocked the ICIJ web site hours before the Pandora papers release). This explains why existing political bodies seem incapable of closing down systems that enable wealth hiding and tax dodging. 

“It demonstrates that the people that could end the secrecy of offshore systems… are themselves benefiting from it,” said Gerald Ryle, director of the ICIJ. “So there’s no incentive for them to end it.”

3. The US is Exposed as a Global Tax Haven 

U.S. citizens are under-represented in these leaks, largely due to where the service providers are located. No U.S. wealth-advisory firms were part of the leaks. Nonetheless over 700 companies revealed in the Pandora papers have ties to beneficial owners connected to the United States.

The Pandora Papers do, however, expose how the U.S. has become a global destination for global wealth, some of it ill-gotten. The Panama Papers, the Paradise Papers (Bermuda and Singapore) and Luanda Leaks (Angola) all reinforced the misperception that most of these financial shell games take place “off shore,” in secrecy jurisdictions and tax havens in small countries with weak banking laws.

But the Pandora Papers show that the U.S. and states like South Dakota now rival notoriously opaque jurisdictions in Europe and the Caribbean in financial secrecy. The states with the most active trusts revealed in the files were South Dakota (81), Florida (37), Delaware (35), Texas (24), and Nevada (14). 

4. Shady Billionaires from Around the World Are Going to South Dakota 

Findings suggest that South Dakota has sheltered billions in wealth linked to wealthy individuals previously accused of serious financial crimes and labor violations.  Two examples: Brazilian orange juice baron, Horst Happel, was fined $88 million in 2016 for underpaying his workers. In 2017, he moved substantial wealth to a trust in South Dakota.  Carlos Morales Troncoso was the former vice-president of the Dominican Republic. He ran a sugar company called Central Romana sugar company that was accused of human rights violations. He set up trusts for his daughters in the Bahamas that were moved, after his death, to South Dakota. The reason global money is flowing to the “Mount Rushmore State” is because of their low taxes and advantageous dynasty trusts.

5. The Pandora Papers Will Boost the Case for US Tax Reform

The Pandora Papers will hopefully give a boost to the US Congress in passing a progressive tax plan to fund the Build Back Better program—and that includes money for IRS enforcement to ensure the wealthy pay their fair share. 

As The Guardian reports: “The Pandora papers also place a revealing spotlight on the offshore system itself. In a development likely to prove embarrassing for US President, Joe Biden, who has pledged to lead efforts internationally to bring transparency to the global finance system, the US emerges from the leak as a leading tax haven.  The files suggest the state of South Dakota, in particular, is shelter billions of dollars in wealth linked to individuals previously accused of serious financial crimes.”

Originally published on Common Dreams by CHUCK COLLINS and republished under a Creative Commons license  (CC BY-NC-ND 3.0).

Related Articles:

Find books on Politics and many other topics at our sister site: Cherrybooks on Bookshop.org

Enjoy Lynxotic at Apple News on your iPhone, iPad or Mac.

Lynxotic may receive a small commission based on any purchases made by following links from this page

Business, Finance, News, Observation, Politics

Pandora Papers: ‘Biggest-Ever’ Bombshell Leak Exposes Financial Secrets of the Super-Rich

Above: Photo Collage /Lynxotic / Original Image by ICIJ

“This is the Panama Papers on steroids.”

In what’s being called the “biggest-ever leak of offshore data,” a cache of nearly 12 million documents published Sunday laid bare the hidden wealth, secret dealings, and corruption of hundreds of world leaders, billionaires, public officials, celebrities, and others.

The bombshell revelations—known as the Pandora Papers—were published by the International Consortium of Investigative Journalists (ICIJ) and include private emails, secret contracts, and other records obtained during a two-year investigation involving more than 600 journalists in 117 countries and territories.

“This is the Panama Papers on steroids,” said ICIJ director Gerard Ryle, referring to the 2016 exposé of the tax-evading secrets of the super-rich. “It’s broader, richer, and has more detail.”

According to The Guardian:

More than 100 billionaires feature in the leaked data, as well as celebrities, rock stars, and business leaders. Many use shell companies to hold luxury items such as property and yachts, as well as incognito bank accounts. There is even art ranging from looted Cambodian antiquities to paintings by Picasso and murals by Banksy.

“There’s never been anything on this scale and it shows the reality of what offshore companies can offer to help people hide dodgy cash or avoid tax,” said ICIJ’s Fergus Shiel, who added that the people in the files “are using those offshore accounts, those offshore trusts, to buy hundreds of millions of dollars of property in other countries, and to enrich their own families, at the expense of their citizens.”

The leaked documents reveal how some of the world’s wealthiest people avert the financial consequences of their misdeeds by using offshore entities. Dozens of current and former world leaders feature prominently in the files, including Russian President Vladimir Putin, Jordanian King Abdullah II, and former British Prime Minister Tony Blair.

While most of the richest Americans do not appear in the files, The Washington Post reports that “perhaps the most troubling revelations for the United States… center on its expanding complicity in the offshore economy.”

Chuck Collins, author of The Wealth Hoarders: How https://bookshop.org/a/565/9781509543496Billionaires Pay Millions to Hide Trillions, and co-editor of Inequality.org at the Institute for Policy Studies, said in a statement that “the U.S. has become the weak link in stopping global crime and wealth hiding.”

“States like South Dakota and Delaware have morphed their laws to attract billions, sometimes illicitly obtained, from around the world,” he said. “We in the U.S. should be embarrassed that we’ve become a magnet for kleptocratic funds.”

Collins added that the Pandora Papers show “it is time for U.S. lawmakers to shut down the hidden wealth system that allows for such aggressive tax avoidance and the sequestering of wealth.”

ICIJ said Sunday that the “publication of Pandora Papers stories comes at a critical moment in a global debate over the fairness of the international tax system, the role of Western professionals in the shadow economy, and the failure of governments to stanch the flow of dirty money into hidden companies and trusts,” and that the documents “are expected to yield new revelations for years to come.”

Originally published on Common Dreams by BRETT WILKINS and republished under a Creative Commons license  (CC BY-NC-ND 3.0).

Related Articles:

Find Political Recommendations and many other topics at our sister site: Cherrybooks on Bookshop.org

Enjoy Lynxotic at Apple News on your iPhone, iPad or Mac.

Lynxotic may receive a small commission based on any purchases made by following links from this page