Yahoo Finance Tony Blair, Shakira: Everyone named in the world’s biggest tax haven leak so far
More than 330 politicians, 35 world leaders (current and former), and over 300 billionaires have had their “hidden riches” and financial secrets exposed in what is now the largest leak of documents exposing offshore tax haven secrecy.
Dubbed the 'Pandora Papers', the huge data leak involves 11.9 million confidential files that expose the secret offshore banking affairs of the rich and powerful that are typically kept well hidden from the public eye.
The huge trove exposes how the world’s wealthiest are able to shift their finances abroad to tax havens like Panama, Switzerland, Dubai, Monaco and the Cayman Islands, and pay little tax as a result.
The files, sent to the International Consortium of Journalists (ICIJ), were then shared with 150 global media organisations. Within these documents, some 400 Australians have been named, the AFR estimates.
Also read:
And if you think it doesn’t matter to you what the world’s rich and powerful do with their money, hiding it in offshore tax havens has consequences for you: tax that isn’t paid in the individual’s home country means that society is worse-off.
"The ability to hide money has a direct impact on your life... it affects your child's access to education, access to health, access to a home,” said US think tank Global Financial Integrity policy director Lakshmi Kumar.
Here’s an explainer of what the documents are, and who has been named so far.
‘Pandora Papers’: Sound familiar?
The Pandora Papers investigation was performed by the same group that reported on similar leaks the Panama Papers (2016) and the Paradise Papers (2017).
But the sheer size of these latest documents – totalling 2.94 terabytes – makes the Pandora Papers the largest leak of its kind in history.
The Panama Papers triggered police raids as well as new laws in several countries, with Iceland and Pakistan’s then-prime ministers losing their jobs as a result.
This new set of papers involve information from 14 offshore providers that are based all around the world.
“The Pandora Papers provide more than twice as much information about the ownership of offshore companies,” the ICIJ stated.
“In all, the new leak of documents reveals the real owners of more than 29,000 offshore companies. The owners come from more than 200 countries and territories, with the largest contingents from Russia, the UK, Argentina and China.”
The Organised Crime and Corruption Reporting Project’s Pete Jones said the former leaks were occasionally dismissed as a few bad apples.
“This leak shows the interconnectedness of the offshore world," he said.
Is everyone named in the Pandora Papers guilty of wrongdoing?
Not necessarily – there are legal and legitimate reasons why people move money offshore, so just because someone is named in the documents doesn’t mean they’ve done something illegal.
“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,” the ICIJ stated.
“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.”
These documents also show that far from offshore tax havens being located in obscure corners of the world, the illicit activity is being carried out by “elite players” in some of the world’s biggest countries like multinational banks, law firms based in the US and Europe.
WATCH BELOW: What are the Pandora Papers?
Who has been exposed in the documents?
Nearly a thousand companies in offshore havens have been exposed as having links to 336 politicians, public officials, country leaders, cabinet ministers, ambassadors and more.
The leaked documents shed light on several heads of state, including former UK Prime Minister Tony Blair, as well as the presidents of Ukraine, Kenya, Ecuador, the Prime Minister of the Czech Republic and the King of Jordan.
Close friends and members of Russian President Vladimir Putin have also been named in the documents, including a childhood friend and an alleged former mistress, who was revealed to have bought a US$4 million (AU$5.5 million) apartment in Monaco.
Taiwanese-Canadian billionaire Joseph Tsai’s name also came up. Tsai is Canada’s second-wealthiest person, and Alibaba’s second-largest shareholder. He’s also considered the right-hand man of eCommerce giant co-founder Jack Ma.
Celebrities like ‘Hips Don’t Lie’ singer Shakira and model Claudia Schiffer have also been linked to offshore assets exposed by the documents.
Software company Reynolds & Reynolds’ former CEO Robert Brockman has also been named, as well as Turkish construction mogul Erman Ilicak.
Pornhub co-owner David Tassilo also appears in the documents, as well as Canadian Olympian Elvis Stojko, Indian cricketer Sachin Tendulkar, and actress Monica Belucci.
ATO vows to investigate, crack down on wrongdoers
The Australian Taxation Office has said it’ll be analysing information in the massive leak to uncover links to Australians.
“We will certainly look at this data set and compare it with the data we already have to identify any potential connections,” said ATO deputy commissioner and Serious Financial Crime Taskforce (SFCT) Will Day.
The ATO investigates offshore tax evasion all year and is “well connected locally and globally” in efforts to combat financial crime, he said.
While most Australians do the right thing, Day had a warning for those attempting to hide ownership interests or misdeeds through offshore arrangements.
“We have some of the best auditors, investigators, analysts and data scientists in the world who work together to sort the good from the bad, ensuring no stone is left unturned,” Day said.
“Your secrets are no longer safe, and you can expect to feel serious consequences for your actions. No complicated money trail is too difficult for us to unravel.”
Follow Yahoo Finance on Facebook, LinkedIn, Instagram and Twitter, and subscribe to the free Fully Briefed daily newsletter.
