Pandora Papers show offshore financial system is thriving - Martyn McLaughlin

It is understandable to be overwhelmed by the unprecedented leak of the Pandora Papers, a tranche of documents that reveals the hidden wealth and tax avoidance techniques employed by some of the world’s richest and most powerful figures.

A network of journalists around the world have spent months poring over the leaked information, fastidiously dotting the i’s and crossing the t’s so as to make the connections between seemingly anonymous corporate entities and those who wield immense influence.

We have, of course, been here before. Five years have passed since the publication of the Panama Papers, which exposed hundreds of thousands of offshore companies set up by the law firm Mossack Fonseca. It was followed a year later by the Paradise Papers, a major leak from three offshore providers.

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The cumulative fallout from those scandals has seen governments the world over recoup hundreds of millions of pounds in back taxes and penalties, and multiple criminal investigations have been launched in various jurisdictions.

The same will undoubtedly follow the Pandora Papers, but its release indicates that for all the hand wringing and vows of reform that were made in the wake of the previous leaks, precious little has changed.

So far, the journalists involved in the global investigation have identified more than 500 British Virgin Island companies that had been clients of Mossack Fonseca. Rather than simply shutting down their business following the release of the Panama Papers, they simply switched to other providers in the British Overseas Territory.

The 2.94 terabytes of data which forms the latest leak is also likely the tip of the iceberg. The reams of documents and spreadsheets released covers a total of 14 offshore service providers, but many more are known to operate.

An exterior view of 25 Maddox Street in the Mayfair district of London. The property is linked to Azerbaijani President Ilham Aliyev in a new report dubbed the Pandora Papers that 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. Picture: AP Photo/Matt Dunham

According to the International Consortium of Investigative Journalists, the driving force behind the Pandora Papers, the data it has probably only represents a “small fraction” of the offshore activity taking place.

The trove of information that has come to light is undoubtedly significant, but make no mistake, the murky world of the offshore financial system still has plenty of secrets to give up.

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