Tuesday, November 7, 2017 at 8:21 AM

‘Paradise Papers’ Out Elizabeth II as Tax-Dodging Queen

Posted by Anthony L. Hall

US Commerce Secretary Wilbur Ross, Britain’s Queen Elizabeth and a key ally to Canadian Prime Minister Justin Trudeau are among the 120 rich and powerful people who are mentioned in the Paradise Papers, a new release of data about offshore tax havens and obscure financial dealings.

The Paradise Papers are a massive trove of 13.4 million records — many of which were leaked from the offshore law firm Appleby, which was founded more than 100 years ago and operates in places ranging from Bermuda and the Cayman Islands to the Isle of Man, Mauritius, Shanghai and Hong Kong.

Reflecting millions of loan deals, financial statements, emails and other documents, the data reveals how specialty firms handle the money of wealthy individuals, families and corporations.

(NPR, November 6, 2017)

Forgive me, but this is one of those occasions when “Breaking News” obliges me to say, almost in exasperation, I told you so.

The following excerpt from “Leaked ‘Panama Papers’ Affirm more than Reveal Offshore Banking Secrets,” April 6, 2016, explains why.

___________________

This is hardly news, let alone ‘Breaking News’: Leaking the Pentagon Papers was a bombshell because they revealed that the US government was lying about the nature of its involvement in Vietnam. Leaking the Panama Papers is not because they merely affirm what is generally known about offshore tax-dodging and money-laundering schemes.

Not to mention the truly rare insights the ‘Swiss Papers’ provided in this regard just a year ago. …

I’m on record commenting – in ‘Unlike NSA Leaks, HSBC Leaks Actually Serve Public Interest,’ February 10, 2015 – on the rogue’s gallery of tax dodgers and money launderers this investigation outed. More to the point, many of the names that popped up in the Swiss Papers are popping up in the Panama Papers too.

Alas, in this age of Twitter and Snapchat, even news of the discovery of life on Mars would probably trend for only a day, before the next trending topic knocks it out of public consciousness. …

Russian President Vladimir Putin can be forgiven for thinking he’s ‘the main target of Panama Papers leak’ – as the New York Daily News headlined its sensational report on Monday.

The problem of course is that targeting Putin as a kleptomaniac is about as consequential as targeting Trump as a demagogue. Nothing indicates this quite like the litany of reports over the years that have outed Putin as the biggest political crook in history … all to no avail. I have decried his immunity/impunity in this respect in many commentaries – from the ‘Putinization of Russia…,’ November 2, 2006, to ‘Ukraine’s Orange Revolution Turns ‘Red,’’ February 25, 2014. …

The US Tax Code has become riddled with so many tax-avoidance loopholes, they render most tax-haven schemes redundant. To say nothing of the fact that states like Delaware and Nevada now compete with (offshore) tax havens when it comes to incorporating shell companies to hide cash. Shamefully, as ‘fallout’ from the banking crisis demonstrated, the scandal is that it’s perfectly legal for the rich in America to avail themselves of all kinds of schemes to avoid taxes, hide assets, and get richer.

Mind you, law firms are still doing for non-American clients in these tax havens what Mossack Fonseca is accused of doing for its clients in Panama. Indeed, if Putin’s moneymen only laundered two of his forty billion in ill-gotten gains through Panama, chances are that they laundered similar amounts through other tax havens like Hong Kong; you know, spreading the wealth (and risk) around. Moreover, the BBC reports that tax havens hold up to $30 trillion in undisclosed accounts.

Hence, it’s only a matter of time before leaks from the Luxembourg Papers, the Singapore Papers, the Turks and Caicos Papers, et al. become global headlines. …

Until then, bear this in mind: During Leona Helmsley’s notorious trial for tax evasion in 1989, one of her employees testified to her abiding belief that, ‘Rich people don’t pay taxes. Only poor people pay taxes.’ Trust me, folks, this revealed the perversely entitled motto that far too many rich people still live by.

__________________

This Helmsleyian aphorism bears highlighting. Because it explains why, despite such leaks and the embarrassment they cause, nothing will change. After all, the rich regard tax avoidance as an article of faith. And venal politicians abound who are willing to ensure laws exist that enable the rich to do so, the cheating of their respective treasuries, let alone taxpaying citizens, be damned.

Which brings me to the Paradise Papers now making headlines. They too amount to little more than tabloid fodder. For they mostly reveal the self-evident truth that celebrities (like Bono and Lewis Hamilton) and corporations (like Apple and Facebook) are no different from crooks (like political despots and drug lords) who hide their money offshore.

Granted, I relish the prospect of congressional/parliamentary committees and special prosecutors imputing guilt to politicians like President Trump and members of his Cabinet who have been caught doing the same. This stems from incriminating tidbits about his commerce secretary, Wilbur Ross. He reportedly has billions tied up in undisclosed entanglements, which have him doing business with sanctioned Russian companies and oligarchs, including no less a person than Putin’s son-in-law.

But, my title notwithstanding, I even couldn’t care less that these papers outed Queen Elizabeth II as a tax dodger. After all, what’s the point of being the queen of tax havens like Bermuda and Cayman Islands if “one” can’t reap the same, wholly legal tax-dodging benefits one’s lowly lords (like the infamous Michael Ashcroft) do.

Not to mention that Her Majesty deigned to begin paying taxes in 1992 only to quell restive resentment among her subjects over the opulent lifestyle of some lesser royals. Which is why this sovereign is probably cursing her embarrassment with that common saying: no good deed goes unpunished.

Frankly, the only thing I find newsworthy about this latest leak is that it appears Putin has more money invested in US companies than Trump.

Behind one of Silicon Valley’s most prominent investors, Yuri Milner, was hundreds of millions of dollars in Kremlin funding. The documents show that Mr. Milner’s investment in Twitter relied on money from VTB, bank controlled by the Russian state. One of his most significant investors in Facebook relied on funding from Gazprom Investholding, another government-controlled institution.

(New York Times, November 5, 2017)

Then again, it’s hardly surprising that Putin’s portfolio is so deep and diverse given this:

Amazon CEO Jeff Bezos made waves this week when he briefly unseated Bill Gates as the wealthiest person in the world, according to Bloomberg’s tracker. The two US tech titans are jockeying for the lead at around $90 billion each. But according to Hermitage Capital Management CEO Bill Browder, they’re nothing compared to Russian President Vladimir Putin, whose personal fortune Browder ‘believes’ to be $200 billion.

(Fortune, July 29, 2017)

Of course, no bank robber would deposit his loot in a bank he robbed. This explains why Putin has invested in American companies instead of Russian ones. Besides, thanks to his fleecing, he knows full well that the bottom line of Russia’s biggest companies is as fake as the news his trolls peddle through Facebook and other social media.

Related commentaries:
Panama Papers
Special Russia prosecutor

Sorry, comments for this entry are closed at this time.

My Books

VFC Painting

Archive

Subscribe via Email


Powered by FeedBlitz