The Fifth Part . . .

#ShellCompanies #OffShoreAccounts #ThePanamaPapers #ThePandoraPapers

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Exodus 22: 1 If a man shall steal an ox, or a sheep, and kill it, or sell it; he shall restore five oxen for an ox, and four sheep for a sheep.


[1] https://panamapapers.org/panama-papers-tax-havens-and-the-new-politics

Back in 2016, outside the town hall-sized parliament in Reykjavik, a small crowd kicked the fence, banged pots and pans and threw eggs at the building. The Icelandic Prime Minister Sigmundur Gunnlaugsson had just stood down over allegations he had failed to disclose his interest in his family's offshore account. He was the first political casualty of the Panama leaks scandal.


The prime minister has not been accused of breaking any Icelandic law. No matter. The impression of a conflict of interest and of a lack of transparency was enough to bring him down. A sizeable number of the crowd huddled against a biting north-east wind simply would not accept a leader with links to offshore havens. This is a small country that only recently had almost been brought down by failed banks using shell companies in tax havens. What made the disclosures even more sensitive for the prime minister is that he was overseeing negotiations over the failed banks.


There was a new politics that had grown out of the financial crash in 2008. What was once confined to the margins of public debate - tax havens, bank secrecy, corporate tax rates, tax evasion - has seeped into mainstream politics. The actions of the global elites feed the strain of anger detected in European and US politics. In 1994 the three-part series on BBC called Dirty Money showed examples of cartel members dropping off cases of cash in British dependent territories in the Caribbean. But by far the biggest business was providing shell companies.


These were islands of secrecy and the flows of money that passed through the offshore banking centers were immense, but it was hard to spark political interest. It has been stated by many that "Nearly every major crime in the United States had a financial link to offshore havens." The financial crash of 2008 changed everything. Politicians could no longer look away. The revelations eroded trust and voters began to engage with the world of finance. Rogue traders had dealt in sub-prime mortgages. Others had rigged markets.


The investments of banks had nearly brought down the Irish economy. Banks, which were too big to fail, had to be bailed out by taxpayers. Politicians and voters paid attention. Supposedly, Europe's leaders have been working on legislation to ensure that, in the future, taxpayers will not have to stump up for failing banks. The post-2008 world has also focused attention on inequality for the average citizen. Certainly, in the United States one of the main political questions is whether the system works for the many or for the few.

So, in a time of insecurity, who pays what tax matters. The European Commission promised to crack down on tax avoidance as a result of the Panama Papers. A Commission official even welcomed the Panama Papers, saying: "The global focus on this issue provides us with the momentum we need to drive forward our agenda." European Competition Commissioner Margrethe Vestager described the Panama Papers as the "tip of the iceberg". Several governments promised to launch investigations into the individuals named in the documents and to recover money if there was proof of illegality. [1]

[2] https://www.nbcnews.com/storyline/panama-papers/bomb-kills-panama-papers-reporter-malta-s-prime-minister-says-n811221

But then, a Maltese investigative journalist who had exposed her island nation's links with the Panama Papers document leak was killed when a bomb destroyed her car as she was driving near her home. Daphne Caruana Galizia, 53, had just driven away from her home in Mosta, near the capital, Valletta, when the bomb exploded, sending wreckage spiraling over a wall and into a field. Caruana Galizia's death resulted from a "barbaric attack" that was also an assault on freedom of expression. Caruana Galizia was one of 28 Europeans who were "shaping, shaking and stirring" Europe.[2]

[3] https://www.maltatoday.com.mt/news/court_and_police/105578/caruana_galizia_public_inquiry_continues_with_testimony_of_new_economic_crimes_police_chief_operation_green

Three men, George Degiorgio, Alfred Degiorgio and Vince Muscat, have been charged with carrying out the assassination, while Yorgen Fenech is charged with masterminding the murder.

Melvin Theuma, who acted as a middleman between Fenech and the three killers, was granted a presidential pardon last year to tell all. [3]


[4] https://theworldnews.net/mt-news/live-yorgen-fenech-back-in-court-over-money-laundering-charges

Interestingly, Yorgen Fenech has continued being at the center of more money crimes. Last month, he was back in court over money laundering crimes. Why is this guy allowed to roam free? These so-called elite are blatant in the way they flaunt their inconsequential activities. It seems the sacrifices so many made in the exposure of financial crimes with the Panama Papers were made in vain. [4]


[5] https://www.icij.org/investigations/pandora-papers/global-investigation-tax-havens-offshore/

Millions of leaked documents and the biggest journalism partnership in history have uncovered financial secrets of 35 current and former world leaders, more than 330 politicians and public officials in 91 countries and territories, and a global lineup of fugitives, con artists and more murderers. The secret documents expose offshore dealings of the King of Jordan, the presidents of Ukraine, Kenya and Ecuador, the prime minister of the Czech Republic and former British Prime Minister Tony Blair.


The files also detail financial activities of Russian President Vladimir Putin’s “unofficial minister of propaganda” and more than 130 billionaires from Russia, the United States, Turkey and other nations. The leaked records reveal that many of the power players who could help bring an end to the offshore system instead benefit from it – stashing assets in covert companies and trusts while their governments do little to slow a global stream of illicit money that enriches criminals and impoverishes nations.


Among the hidden treasures revealed in the documents: A $22 million chateau in the French Riviera – replete with a cinema and two swimming pools – purchased through offshore companies by the Czech Republic’s populist prime minister, a billionaire who has railed against the corruption of economic and political elites. More than $13 million tucked in a secrecy-shaded trust in the Great Plains of the United States by a scion of one of Guatemala’s most powerful families, a dynasty that controls a soap and lipsticks conglomerate that’s been accused of harming workers and the earth.


Three beachfront mansions in Malibu purchased through three offshore companies for $68 million by the King of Jordan in the years after Jordanians filled the streets during Arab Spring to protest joblessness and corruption. These secret records are known as the Pandora Papers. Thank you, Lyle W, for sharing this information and to International Consortium of Investigative Journalists for your incredible sacrifices and sleuthing throughout the years.


The International Consortium of Investigative Journalists obtained the trove of more than 11.9 million confidential files and led a team of more than 600 journalists from 150 news outlets that spent two years sifting through them, tracking down hard-to-find sources and digging into court records and other public documents from dozens of countries. The leaked records come from 14 offshore services firms from around the world that set up shell companies and other offshore nooks for clients often seeking to keep their financial activities in the shadows.


The records include information about the dealings of nearly three times as many current and former country leaders as any previous leak of documents from offshore havens. In an era of widening authoritarianism and inequality, the Pandora Papers investigation provides an unequaled perspective on how money and power operate in the 21st century – and how the rule of law has been bent and broken around the world by a system of financial secrecy enabled by the U.S. and other wealthy nations.


The findings spotlight how deeply secretive finance have infiltrated global politics – and offer insights into why governments and global organizations have made little headway in ending offshore financial abuses.

There are 956 companies in offshore havens tied to 336 high-level politicians and public officials, including country leaders, cabinet ministers, ambassadors and others.


More than two-thirds of those companies were set up in the British Virgin Islands, a jurisdiction long known as a key cog in the offshore system. At least $11.3 trillion is held “offshore,” according to a 2020 study by the Paris-based Organization for Economic Cooperation and Development. Because of the complexity and secrecy of the offshore system, it’s not possible to know how much of that wealth is tied to tax evasion and other crimes and how much of it involves funds that come from legitimate sources and have been reported to proper authorities.


The Pandora Papers investigation unmasks the covert owners of offshore companies, incognito bank accounts, private jets, yachts, mansions, even artworks by Picasso, Banksy and other masters – providing more information than what’s usually available to law enforcement agencies and cash-strapped governments. People linked by the secret documents to offshore assets include India’s cricket superstar Sachin Tendulkar, pop music diva Shakira, supermodel Claudia Schiffer and an Italian mobster known as “Lell the Fat One.”


The mobster, Raffaele Amato, has been tied to at least a dozen killings. The documents provide details about a shell company, registered in the United Kingdom, that Amato, used to buy land in Spain, shortly before fleeing there from Italy to set up his own crime gang. Amato, whose history helped inspire the highly praised movie “Gomorrah,” is serving a 20-year prison sentence. Tendulkar’s attorney said the cricket player’s investment is legitimate and has been declared to tax authorities. Shakira’s attorney said the singer declared her companies, which the attorney said do not provide tax advantages.


Schiffer’s representatives said the supermodel correctly pays her taxes in the U.K., where she lives. In most countries, it’s not illegal to have assets offshore or to use shell companies to do business across national borders. Businesspeople who operate internationally say they need offshore companies to conduct their financial affairs. But these affairs often amount to shifting profits from high-tax countries, where they are earned, to companies that exist only on paper in low-tax jurisdictions.


Using offshore shelters is especially controversial for political figures, because they can be used to keep politically unpopular or even illicit activities from public view. In popular imagination, the offshore system is often seen as a far-flung cluster of palm-shaded islands. The Pandora Papers show that the offshore money machine operates in every corner of the planet, including the world’s largest democracies. The key players in the system include elite institutions – multinational banks, law firms and accounting practices – headquartered in the U.S. and Europe.


A document in the Pandora Papers shows that banks around the world helped their customers set up at least 3,926 offshore companies with the assistance of Alemán, Cordero, Galindo & Lee, a Panamanian law firm led by a former ambassador to the U.S. The document shows that the firm – also known as Alcogal – set up at least 312 companies in the British Virgin Islands for clients of the American financial services giant Morgan Stanley.


A Morgan Stanley spokesperson said: “We do not create offshore companies. . .. This process is independent of the firm and at the discretion and direction of the client.”


The Pandora Papers investigation also highlights how Baker McKenzie, the largest law firm in the U.S., helped create the modern offshore system and continues to be a mainstay of this shadow economy. Baker McKenzie and its global affiliates have used their lobbying and legislation-drafting know-how to shape financial laws around the world. They have also profited from work done for people tied to fraud and corruption.


The people that the firm has done work for includes Ukrainian oligarch Ihor Kolomoisky, who U.S. authorities allege laundered $5.5 billion through a tangle of shell companies, purchasing factories and commercial properties across the U.S. heartland.


Baker McKenzie also did work for Jho Low, a now-fugitive financier accused by authorities in multiple countries of masterminding the embezzlement of more than $4.5 billion from a Malaysian economic development fund known as 1Malaysia Development Berhad. Low relied on Baker McKenzie and its affiliates to help him and his associates build a web of companies in Malaysia and Hong Kong. U.S. authorities allege they used some of those companies to shift money looted from 1Malaysia Development Berhad.