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Shedding Light in the Darkness

Panama Papers Update

Panama-Papers-021780x390The anonymous source behind the massive (11 million records) Panama Papers leak has authored an 1,800 word manifesto to explain their motives.

It begins – “income inequality is one of the defining issues of our time. It affects all of us, the world over.” The source known only as “John Doe” lashed out at the world’s governments, regulators and law firms for standing idle while the world’s rich and powerful shirk taxation behind the veil of financial secrecy.

U.S. campaign finance practices are condemned, New Zealand is described as a “financial fraud Mecca” and the giant HSBC bank is labeled “one of the most notorious banks on the planet.”

“Banks, financial regulators and tax authorities have failed,” the anonymous author writes in the essay published on the site of the Munich newspaper Süddeutsche Zeitung, which can be read in English here. “Decisions have been made that have spared the wealthy while focusing instead on reining in middle- and low-income citizens.”

The author not only accuses Mossack Fonseca of breaking “myriad laws worldwide” but says there’s enough evidence in the papers to prosecute thousands of accomplices in numerous countries. Last year, Doe gave Süddeutsche Zeitung the documents from Mossack Fonseca that chonicle 40 years of tax evasion activity. Coverage about details from the trove has spurred calls worldwide for investigations into the people mentioned in the papers, from heads of state to sports celebrities.

“Mossack Fonseca did not work in a vacuum — despite repeated fines and documented regulatory violations, it found allies and clients at major law firms in virtually every nation,” the author writes.

“On average, lawyers have become so deeply corrupt that it is imperative for major changes in the profession to take place, far beyond the meek proposals already on the table. To start, the term “legal ethics,” upon which codes of conduct and licensure are nominally based, has become an oxymoron.”

Doe also attacks the media for sleeping on the job – “The media has failed. Many news networks are cartoonish parodies of their former selves, individual billionaires appear to have taken up newspaper ownership as a hobby, limiting coverage of serious matters concerning the wealthy, and serious investigative journalists lack funding. Several major media outlets did have editors review documents from the Panama Papers. They chose not to cover them. The sad truth is that among the most prominent and capable media organizations in the world there was not a single one interested in reporting on the story. Even Wikileaks didn’t answer its tip line repeatedly.”

He questions political will to change anything. “While it’s one thing to extol the virtues of government transparency at summits and in sound bites, it’s quite another to actually implement it,” says Doe. “It is an open secret that in the United States, elected representatives spend the majority of their time fundraising. Tax evasion cannot possibly be fixed while elected officials are pleading for money from the very elites who have the strongest incentives to avoid taxes relative to any other segment of the population.”

The source said they chose to remain anonymous because governments have brought retribution on other whistleblowers who shine the light on “obvious wrongdoing.” Doe cited efforts to prosecute National Security Agency leaker Edward Snowden, who lives in exile in Russia, Bradley Birkenfeld, who was sentenced to prison in the U.S. despite exposing how Swiss bank UBS and others helped tax dodgers, and Antoine Deltour, the former PwC employee who’s on trial for leaking information highlighting Luxembourg’s sweetheart tax deals with global multinationals.

“Legitimate whistleblowers who expose unquestionable wrongdoing, whether insiders or outsiders, deserve immunity from government retribution, full stop,” Doe writes in a call to end the abuse of corporate registrations, partly by putting an end to the financial secrecy that enables tax evasion, money-laundering and the hiding of other ill-gotten sources of wealth.

“The collective impact of these failures has been a complete erosion of ethical standards, ultimately leading to a novel system we still call Capitalism, but which is tantamount to economic slavery,” Doe wrote.

Interviewed today on NPR’s Fresh Air, Kevin Hall, chief economics correspondent for the McClatchy newspapers, which helped break the story was asked about this “economic slavery” point –  “Essentially he’s saying this easy ability to move and hide all of this money is accelerating this terrible inequality, and it’s terrible. Is he right?”

Hall responded: “I think to a certain extent he’s right. And certainly the region of the world that I’ve worked most of my adult life in Latin America, I think it’s real evident that some very powerful people are moving large sums of money. And it begs the question for whom do these governments work? And these are governments where we’ve spent in the case of, say, Guatemala where those are the people coming on our doorstep, getting across the border, creating issues at the border security and the whole political debate we have. And we’ve spent a lot of money both on nation building, on immigration, on drug policy. And yet, these are kleptocratic governments. And I think that’s one of the sad truths that we’re seeing in these documents.”

John Doe concludes: “Historians can easily recount how issues involving taxation and imbalances of power have led to revolutions in ages past. Then, military might was necessary to subjugate peoples, whereas now, curtailing information access is just as effective or more so, since the act is often invisible. Yet we live in a time of inexpensive, limitless digital storage and fast internet connections that transcend national boundaries. It doesn’t take much to connect the dots: from start to finish, inception to global media distribution, the next revolution will be digitized. Or perhaps it has already begun.”

 

 

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One response to “Panama Papers Update

  1. Claude Robichaux May 23, 2016 at 7:11 am

    …… -(*…skids in onstage, plugs in air guitar*) …
    “PANI-MA! … PANI-MA AH AH AH UH AH AHH UH AH … -PANIMA!!!!!”
    …. (*leaps into air, splits yellow zebra print leggings*) “THANK YOU, DETROIT!!!”…
    …(*runs offstage before Animal Control can be called*) …

    Like

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