Pandora papers: investigative journalists expose data leak

Loren Savage, Writer

Nearly 12 million documents revealing hidden wealth were uncovered by the International Consortium of Investigative Journalists and 600 journalists across the world. Images, emails and spreadsheets were included in the documents. In the papers, over 330 politicians, 14 current country leaders and 21 former country leaders were exposed. Not only that, over 29,000 offshore accounts were leaked and 27,000 companies were uncovered in the papers.

The papers exposed how some of the wealthiest people in the world hide their money. Luxury items, yachts and private jets, inheritance planning and property are hidden in accounts owned by everyone from models to mobsters.

The documents brought to light offshore accounts which allow an individual to follow another country’s financial regulations, which can shelter assets and allow customers to pay little to no taxes. “Offshore” means anywhere that is not the individual’s current country of residence. Companies are set up across several countries for these accounts. The papers state that companies are working in Belize, the British Virgin Islands, Singapore, Cyprus, Switzerland, and some U.S. states. Account owners come from more than 200 countries and territories.

These accounts can keep money from government treasuries, worsen the wealth gap, and protect people accused of crimes. Several have been charged with theft of money or natural resources. The system not only drains tax earnings from the country the individual lives in but also can enable criminal activity like drug trafficking or arms trading. The accounts are not illegal because many business people say that offshore accounts are necessary to conduct international business.

Individuals also use shell companies to purchase and hide assets. A shell company is an idle company, with no office or workers, that has a bank account that can be used to make financial transactions. These companies can shield an individual from taxes or be used for money laundering. Purchases can also be made on behalf of the company to hide the person responsible for the purchase.

Most of the documents were made between 1996 and 2020. Many messages included in the papers were about stricter security measures to prevent data leaks, similar to the Panama Papers in 2016.

Over 130 people on the Forbes magazine list of billionaires show up in the papers. Jeff Bezos, Elon Musk, and Bill Gates, who are America’s wealthiest citizens, do not show up in the papers. They likely do not show up because billionaires in the United States already have low tax rates.

14 current country leaders appear in the papers including The King of Jordan, King Abdullah II. The King spent $106 million on homes in Malibu, Washington D.C. and London. The United States and United Kingdom advisers set up a minimum of 36 shell companies from 1995 to 2017 for the King’s use. His lawyers state that he did not misuse public funds.

Andrej Babis, the Czech prime minister, purchased a $22 million home near Cannes, France. The prime minister used shell companies to hide his identity.

The papers detail that the President of Kenya, Uhuru Kenyatta, along with his relatives have several accounts offshore. Their accounts hold assets worth $30 million.

The Russian president Vladimir Putin is involved along with some of his close colleagues and 46 Russian oligarchs, business leaders with much political power. A woman President Putin had an alleged relationship with became the owner of an apartment in Monaco through an offshore company operating in the British Virgin Islands.

Donors to the British Conservative Party have been linked to accounts outlined in the papers. The former British Prime Minister Tony Blair’s assets were also linked in the accounts. Blair purchased an $8.8 million town house through an offshore company which saved him thousands of tax dollars.

The U.S. did not get by completely unscathed. South Dakota and Nevada have financial secrecy laws which have led to many non-U. S. residents and their family members creating U.S.-based accounts. Several offshore companies operate in these states. The family of the former Vice President of the Dominican Republic, Carlos Morales Troncoso, has an account operating in South Dakota. Millions of dollars have been moved from accounts overseas to the state. Many of the companies are working in Sioux Falls.

U.S. billionaires, Robert F. Smith and Robert Brockman appear in the papers. Last year, Brockman was charged with tax fraud.

Australia, Britain and Pakistan have stated they are going to investigate the data leaked in the Pandora papers.

This article will be updated as more information is released.