A new report sheds light on how world leaders, powerful politicians, billionaires and others have used offshore accounts to shield assets collectively worth trillions of dollars over the past quarter-century.
By PAUL WISEMAN and MARCY GORDON WASHINGTON (AP) — Calls grew Monday for an end to the financial secrecy that has allowed many of the world’s richest and most powerful people to hide their wealth from tax collectors. The outcry came after a report revealed the way that world leaders, billionaires and others have used shell companies and offshore accounts to keep trillions of dollars out of government treasuries over the past quarter-century, limiting the resources for helping the poor or combating climate change. The report by the International Consortium of Investigative Journalists brought promises of tax reform and demands for resignations and investigations, as well as explanations and denials from those targeted. The investigation, dubbed the Pandora Papers, was published Sunday and involved 600 journalists from 150 media outlets in 117 countries. Hundreds of politicians, celebrities, religious leaders and drug dealers have used shell companies or other tactics to hide their wealth and investments in mansions, exclusive beachfront property, yachts and other assets, according to a review of nearly 12 million files obtained from 14 firms located around the world. “The Pandora Papers is all about individuals using secrecy jurisdictions, which we would call tax havens, when the goal is to evade taxes,” said Steve Wamhoff, director of federal tax policy at the left-leaning Institute on Taxation and Economic Policy in Washington. The tax dodges can be legal. Gabriel Zucman, a University of California, Berkeley, economist who studies income inequality and taxes, said in a statement one solution is “obvious’: Ban “shell companies — corporations with no economic substance, whose sole purpose is to avoid taxes or other laws.’ “The legality is the true scandal,” activist and science-fiction author Cory Doctorow wrote on Twitter. “Each of these arrangements represents a risible fiction: a shell company is a business, a business is a person, that person resides in a file-drawer in the desk of a bank official on some distant treasure island.” The more than 330 current and former politicians identified as beneficiaries of the secret accounts include Jordan’s King Abdullah II, former U.K. Prime Minister Tony Blair, Czech Republic Prime Minister Andrej Babis, Kenyan President Uhuru Kenyatta, Ecuador’s President Guillermo Lasso, and associates of both Pakistani Prime Minister Imran Khan and Russian President Vladimir Putin.
